EXHIBIT 10.2
[EXECUTION COPY]
CREDIT AGREEMENT
PROVIDING FOR THE ISSUANCE OF
$300,000,000 SENIOR SECURED NOTES DUE 2008
dated as of
April 20, 2001
among
VENCOR OPERATING, INC.
(to be renamed Kindred Healthcare Operating, Inc.)
VENCOR, INC.,
(to be renamed Kindred Healthcare, Inc.)
and
THE LENDERS PARTY HERETO,
and
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Collateral Agent and Administrative Agent
TABLE OF CONTENTS
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ARTICLE 1
Definitions
Section 1.01. Defined Terms............................................................................. 2
Section 1.02. Accounting Terms and Determinations....................................................... 33
Section 1.03. Definitions From Disclosure Statement..................................................... 33
Section 1.04. Other Definitional Provisions............................................................. 33
ARTICLE 2
The Notes
Section 2.01. Issuance of Notes......................................................................... 34
Section 2.02. Interest Rate; Default Rate............................................................... 34
Section 2.03. Method of Electing Interest Periods....................................................... 35
Section 2.04. Administrative Agent and Collateral Agent Fee............................................. 36
Section 2.05. Final Maturity of Notes................................................................... 36
Section 2.06. Mandatory Prepayments of Notes............................................................ 36
Section 2.07. Optional Prepayments...................................................................... 41
Section 2.08. General Provision as to Payments.......................................................... 41
Section 2.09. Computation of Interest and Fees.......................................................... 42
Section 2.10. Release of Security Interest in Assets Being Sold......................................... 43
Section 2.11. Forgiveness of Principal.................................................................. 43
ARTICLE 3
Conditions
Section 3.01. Effectiveness of this Agreement; Closing.................................................. 44
ARTICLE 4
Representations and Warranties
Section 4.01. Corporate Existence and Power............................................................. 47
Section 4.02. Corporate And Governmental Authorization; No Contravention................................ 47
Section 4.03. Binding Effect............................................................................ 48
Section 4.04. Security Interest......................................................................... 48
Section 4.05. Financial Information..................................................................... 48
Section 4.06. Litigation................................................................................ 48
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Section 4.07. Compliance with Erisa.................................................................... 49
Section 4.08. Taxes.................................................................................... 49
Section 4.09. Compliance with Laws..................................................................... 49
Section 4.10. No Regulatory Restrictions on Borrowing.................................................. 49
Section 4.11. Environmental Matters.................................................................... 49
Section 4.12. Full Disclosure.......................................................................... 50
Section 4.13. Information as to Equity Interest and Instruments........................................ 50
Section 4.14. Representations in Other Financing Documents............................................. 51
Section 4.15. Margin Stock............................................................................. 51
Section 4.16. Properties............................................................................... 51
Section 4.17. Existing Indebtedness.................................................................... 51
ARTICLE 5
Affirmative Covenants
Section 5.01. Information.............................................................................. 52
Section 5.02. Maintenance Of Property.................................................................. 56
Section 5.03. Insurance................................................................................ 56
Section 5.04. Compliance with Law, Etc................................................................. 56
Section 5.05. Maintenance of Existence, Rights, Etc.................................................... 57
Section 5.06. Environmental Matters.................................................................... 57
Section 5.07. Designation of Unrestricted Subsidiaries................................................. 57
Section 5.08. Guarantees by Future Restricted Subsidiaries............................................. 59
Section 5.09. Future Assets to Be Added to Collateral.................................................. 60
Section 5.10 Casualty Events.......................................................................... 61
Section 5.11 Ranking.................................................................................. 61
Section 5.12 Post-closing............................................................................. 61
ARTICLE 6
Financial Covenants
Section 6.01. Fixed Charge Coverage Ratio (EBITDAR).................................................... 63
Section 6.02. Total Leverage Ratio..................................................................... 63
Section 6.03. Minimum Consolidated Net Worth........................................................... 64
Section 6.04. Capital Expenditures..................................................................... 64
ARTICLE 7
Negative Covenants
Section 7.01. Limitation on Debt....................................................................... 64
Section 7.02. Negative Pledge.......................................................................... 66
Section 7.03. Consolidations, Mergers and Asset Sales.................................................. 68
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Section 7.04. Limitations on Transactions with Affiliates.................................................... 69
Section 7.05. Limitation on Restrictions Affecting Subsidiaries.............................................. 71
Section 7.06. Limitation on Sale or Issuance of Equity Interests of Restricted Subsidiaries.................. 72
Section 7.07. Restricted Payments............................................................................ 72
Section 7.08. Limitations on Acquisitions and Investments.................................................... 74
Section 7.09. No Change of Fiscal Periods.................................................................... 75
Section 7.10. Limitation on Business......................................................................... 75
Section 7.11. Limitation on Sale and Leaseback Transactions.................................................. 76
Section 7.12. No Modification of Certain Documents Without Consent........................................... 76
Section 7.13. Limitation on Cash Not Held in Collateral Accounts or Concentration Accounts................... 77
Section 7.14. Anti-layering.................................................................................. 77
Section 7.15. Payments for Consents.......................................................................... 77
ARTICLE 8
Defaults
Section 8.01. Events of Default.............................................................................. 77
Section 8.02. Notice of Default.............................................................................. 81
Section 8.03. Enforcement Notice............................................................................. 81
ARTICLE 9
The Agent
Section 9.01. Appointment and Authorization................................................................. 82
Section 9.02. Agents and Affiliates.......................................................................... 82
Section 9.03. Actions by Agents.............................................................................. 82
Section 9.04. Consultation with Experts...................................................................... 83
Section 9.05. Liability of Agents............................................................................ 83
Section 9.06. Indemnification................................................................................ 83
Section 9.07. Credit Decision................................................................................ 83
Section 9.08. Successor Agents............................................................................... 84
Section 9.09. Collateral Agent............................................................................... 84
ARTICLE 10
Changes in Circumstances
Section 10.01. Increased Cost and Reduced Return.............................................................. 85
Section 10.02. Taxes.......................................................................................... 86
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ARTICLE 11
Subordination
Section 11.01. Agreement to Subordinate................................................................................... 88
Section 11.02. Liquidation, Dissolution, Bankruptcy....................................................................... 88
Section 11.03. Default on Senior Obligations.............................................................................. 89
Section 11.04. When Distribution Must Be Paid Over........................................................................ 90
Section 11.05. Subrogation................................................................................................ 90
Section 11.06. Relative Rights; Subordination Not to Prevent Events of Default or Limit Right to Accelerate............... 90
Section 11.07. Subordination May Not Be Impaired By Issuer................................................................ 90
Section 11.08. Rights of Administrative Agent............................................................................. 90
Section 11.09. Distributions and Notices to, and Notices and Consents By,representatives of Holders of Senior Obligations. 91
Section 11.l0. Administrative Agent Entitled to Rely...................................................................... 91
Section 11.11. Administrative Agent to Effectuate Subordination........................................................... 91
Section 11.12. Administrative Agent Not Fiduciary for Holders of Senior Obligations....................................... 91
Section 11.13. Legend on Notes............................................................................................ 9l
Section 11.14. Reliance by Holders of Senior Obligations on Subordination Provisions; No Waiver........................... 92
ARTICLE 12
Miscellaneous
Section 12.01. Notices................................................................................................. 93
Section 12.02. No Waiver............................................................................................... 93
Section 12.03. Expenses; Indemnification............................................................................... 93
Section 12.04. Sharing of Set-offs..................................................................................... 95
Section 12.05. Amendments and Waivers.................................................................................. 96
Section 12.06. Successors and Assigns.................................................................................. 97
Section 12.07. Margin Stock............................................................................................ 100
Section 12.08. Governing Law; Submission to Jurisdiction............................................................... 100
Section 12.09. Counterparts; Integration............................................................................... 100
Section 12.10. Waiver of Jury Trial.................................................................................... 101
Section 12.11. Confidentiality......................................................................................... 101
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SCHEDULES
Initial Lender Schedule
Schedule 1 - Restricted Subsidiaries, Insurance Subsidiaries, Excluded
Partnerships (as of the Closing Date)
Schedule 2 - Existing Affiliate Agreements
Schedule 3 - Owned Property
Schedule 4 - Initial Master Lease Properties; Other Leased Property; Third
Party Leases
Schedule 5 - Management Contracts
Schedule 6 - Permitted Investments
Schedule 7 - Local Real Estate Counsel
Schedule 8 - Litigation
Schedule 9 - Existing Debt (as of the Closing Date)
Schedule 10 - Debt not held in Concentration Accounts or Pledged
Schedule 11 - Post-Closing Deliveries
EXHIBITS
Exhibit A - Form of Senior Secured Note
Exhibit B - Form of Security Agreement
Exhibit C - Form of Subsidiary Guaranty Agreement
Exhibit D - Form of Vencor Guaranty Agreement
Exhibit E - Form of Intercreditor Agreement
Exhibit F-l - Form of Opinion of the General Counsel of Vencor and the Issuer
Exhibit F-2 - Form of Opinion of the Vice President of Corporate Legal Affairs
of Vencor and the Issuer
Exhibit G - Form of Opinion of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, Special
Counsel for Vencor and the Issuer
Exhibit H - Form of Opinion of Morris, Nichols, Arsht & Xxxxxxx, Special
Counsel for Vencor and the Issuer
Exhibit I - Form of Opinion of Local Real Estate Counsel
Exhibit J - Form of Subordination Provisions
Exhibit K - Form of Assignment Agreement
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CREDIT AGREEMENT
This CREDIT AGREEMENT is dated as of April 20, 200l and entered into by and
among VENCOR OPERATING, INC. (to be renamed Kindred Healthcare Operating, Inc.),
a Delaware corporation (the "Issuer"), and VENCOR, INC. (to be renamed Kindred
Healthcare, Inc.), a Delaware corporation ("Vencor"); THE LENDERS LISTED ON THE
SIGNATURE PAGES HEREOF (each individually referred to herein as a "Lender" and
collectively as "Lenders"); and XXXXXX GUARANTY TRUST COMPANY OF NEW YORK, as
collateral agent and administrative agent for the Lenders.
RECITALS
WHEREAS, Vencor and the Issuer previously entered into a $1,000,000,000
Credit Agreement dated as of April 29, 1998 (as amended, the "Pre-Petition
Senior Credit Agreement") with a group of banks and other financial
institutions, in connection with which Bank of America N.A. (previously named
Nationsbank N.A.) acts as administrative agent and Xxxxxx Guaranty Trust Company
of New York acts as documentation agent and collateral agent, such Agreement
providing for the making of loans to and the issuance of letters of credit for
the account of the Issuer and the guarantee of the Issuer's obligations by
Vencor and certain of Vencor's other subsidiaries;
WHEREAS, on September 13, 1999, Vencor, the Issuer and certain of Vencor's
other subsidiaries (collectively, the "Debtors") filed with the Court (such term
and other capitalized terms used in these recitals without definition having the
meanings set forth in Sections 1.01 through 1.04 of this Agreement) voluntary
petitions for relief under the Bankruptcy Code, such proceedings being jointly
administered under Case Nos. 99-03199 (MFW) through 99-03327 (MFW) (the "Chapter
11 Cases");
WHEREAS, the Debtors have proposed a Plan of Reorganization that provides,
inter alia, for the holders of the Senior Debt Claims (i.e., claims arising
under the Pre-Petition Senior Credit Agreement) to receive in the aggregate, in
partial satisfaction of the Senior Debt Claims, senior secured notes of the
Issuer with a stated principal amount of $300,000,000, all as set forth in the
Plan of Reorganization; and
WHEREAS, the Plan of Reorganization contemplates that such indebtedness
will be issued pursuant to and governed by a credit agreement and related
documentation:
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
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ARTICLE 1
Definitions
Section 1.01. Defined Terms. The following terms, as used herein, have the
following meanings:
"Acquisition" means (i) any Investment by the Issuer or any of its
Restricted Subsidiaries in a Person whereby such Person becomes a Restricted
Subsidiary of the Issuer or whereby such Person is merged with and into the
Issuer or a Restricted Subsidiary or (ii) an acquisition by the Issuer or any of
its Restricted Subsidiaries of the property and assets of any Person that
constitutes substantially all of the assets of such Person, or any division,
line of business, Healthcare Facility or other business unit of such Person;
when used in relation to Vencor, "Acquisition" has a comparable meaning except
that references to the Issuer shall be read as Vencor and Vencor may, unless
otherwise prohibited hereunder, make Acquisitions involving any Vencor
Unrestricted Subsidiary.
"Account Control Agreement" has the meaning set forth in Section 1 of the
Security Agreement.
"Actual Purchase Price" has the meaning set forth in Section 2.06(b)(iii).
"Adjusted Consolidated Net Income" means, for any period, Consolidated Net
Income for such period, adjusted to exclude therefrom, without duplication, (i)
gains or losses from Asset Sales net of related tax effects and (ii) any net
income (or loss) of any Person (other than a Restricted Subsidiary) in which the
Issuer or any Restricted Subsidiary has an ownership interest, except that such
Person's net income shall not be excluded if (and to the extent that) such
Person pays dividends or distributions in cash to the Issuer or any of its
Restricted Subsidiaries during such period.
"Administrative Agent" means Xxxxxx, in its capacity as administrative
agent for the Lenders under the Financing Documents, and its successors in such
capacity.
"Administrative Questionnaire" means, with respect to each Lender, an
administrative questionnaire in the form prepared by the Administrative Agent,
duly completed by such Lender and submitted to the Administrative Agent (with a
copy to the Issuer).
"Affiliate" means any Person (other than a Subsidiary) directly or
indirectly controlling, controlled by or under common control with the Issuer.
As used in this definition, the term "control" means possession, directly or
indirectly, of the power to
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vote 10% or more of any class of voting securities of a Person or to direct or
cause the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise. The fact that
Ventas and Vencor may have many stockholders in common will not be deemed to
constitute "common control" for purposes of this definition unless stockholders
possessing, directly or indirectly, the power to vote more than 10% of Vencor's
outstanding common stock and more than 10% of Ventas' outstanding common stock
attempt to influence Vencor's management or policies in a manner which is, or
could reasonably be expected to be, favorable to any Ventas Company.
Notwithstanding anything to the contrary in this definition, no individual shall
be deemed an Affiliate of any Person solely by reason of his or her being an
employee, officer or director of such Person.
"Agents" means the Collateral Agent and the Administrative Agent.
"Agreement" means this Credit Agreement dated as of April 20, 2001, as it
may hereafter be amended, supplemented or otherwise modified from time to time.
"Annualized Basis" means that, when a provision hereof provides that
Consolidated EBITDAR, Consolidated Interest Expense, Consolidated Rental Expense
or Consolidated EBITDA is to be calculated as of a date (the "relevant date")
prior to the end of the fourth full Fiscal Quarter following the Closing Date
for a period of four consecutive Fiscal Quarters ending on the relevant date,
(i) Consolidated EBITDAR, Consolidated Interest Expense, Consolidated Rental
Expense or Consolidated EBITDA, as the case may be, shall be calculated for the
period from the end of the month in which the Closing Date occurs to the
relevant date (a "short period") and (ii) the amount so calculated shall be
multiplied by a fraction of which the numerator is 12 and the denominator is the
number of whole calendar months in such short period.
"Applicable Laws" means all applicable provisions of constitutions,
statutes, laws, rules, treaties, regulations and orders of all Governmental
Authorities and all applicable orders, rules and decrees of courts and
arbitrators.
"Asset Sale" means any sale, lease or other transfer (including any such
transaction effected by way of merger or consolidation) of any asset by the
Issuer or any Restricted Subsidiary, including without limitation any sale-
leaseback transaction, whether or not involving a capital lease, but excluding
(i) any sale of inventory, cash, cash equivalents and other cash management
investments and obsolete, unused or unnecessary equipment, in each case in the
ordinary course of business, (ii) any transfer of assets by the Issuer to any
Restricted Subsidiary or by any Restricted Subsidiary to the Issuer or another
Restricted Subsidiary, (iii) any transfer of assets or related series of
transfers of assets involving cash proceeds of less than $350,000 and (iv) with
respect to a lease of any property (including any Master Lease Property),
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surrender to or repossession by the lessor of such property, or the termination
of the lease relating to such property by the lessor; provided that, in the case
of any event referred to in clause (iv), any cash proceeds received by the
Issuer and its Restricted Subsidiaries in excess of $350,000 in connection with
such event shall be deposited in a Collateral Account and applied as set forth
in Section 2.06(a).
"Assignee" has the meaning set forth in Section 12.06(c).
"Assignment Agreement" means an Assignment Agreement in substantially the
form of Exhibit K annexed hereto.
"Atria" means Atria Communities, Inc., a Delaware corporation, and its
successors.
"Atria Shares" means all shares of common stock of Atria owned directly or
indirectly by the Issuer or any Restricted Subsidiary.
"Attributable Debt" means, in respect of a Sale and Leaseback Transaction
the present value, discounted at the interest rate implicit in the Sale and
Leaseback Transaction, of the total obligations of the lessee for rental
payments during the remaining term of the lease in the Sale and Leaseback
Transaction.
"Bankruptcy Code" means Title 11 of the United States Code entitled
"Bankruptcy", as now and hereafter in effect, or any successor statute.
"BHC Shares" means all shares of common and preferred stock of Behavioral
Healthcare Corporation, a Delaware Corporation, owned directly or indirectly by
the Issuer or any Restricted Subsidiary.
"Board of Directors" of a Person means the board or directors or comparable
governing body of such Person, or any committee thereof duly authorized to act
on its behalf.
"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in New York, New York are authorized by law to close.
"Capital Lease" means a lease that would be capitalized on a balance sheet
of the lessee prepared in accordance with GAAP. "Capital Lease Obligation" means
the rental obligation under any Capital Lease.
"Casualty Event" means (i) any Condemnation Event with respect to any
property owned by or leased to the Issuer or any Restricted Subsidiary or (ii)
any
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damage to, or destruction of, any property owned by or leased to the Issuer or
any Restricted Subsidiary.
"Casualty Proceeds" means (i) with respect to any Condemnation Event, all
awards or payments received by the Issuer, any Restricted Subsidiary or the
Collateral Agent by reason of such Condemnation Event, including all amounts
received with respect to any transfer in lieu or anticipation of such
Condemnation Event or in settlement of any proceeding relating to such
Condemnation Event and (ii) with respect to any other Casualty Event, all
insurance proceeds or payments (excluding payments with respect to business
interruption) which the Issuer, any Restricted Subsidiary or the Collateral
Agent receives by reason of such other Casualty Event, less, in either case,
unreimbursed expenses or losses related to the Casualty Event, including any
payment with respect to taxes actually paid or to become payable by the Issuer
and its Restricted Subsidiaries (as reasonably estimated by a Financial Officer)
in respect of such Casualty Event.
"Chapter 11 Cases" has the meaning set forth in the Whereas clauses.
"Closing" means the closing hereunder on the Closing Date.
"Closing Date" means the date on which the Administrative Agent shall have
received the documents specified in or pursuant to Section 3.01 and the other
conditions specified in Section 3.01 shall have been satisfied or waived.
"Collateral" means all property, real and personal, tangible and
intangible, with respect to which Liens are created or purportedly created
pursuant to the Collateral Documents.
"Collateral Accounts" has the meaning set forth in Section 1 of the
Security Agreement.
"Collateral Agent" means Xxxxxx, in its capacity as collateral agent for
the holders of the Secured Obligations under the Financing Documents, and its
successors in such capacity.
"Collateral Documents" means the Security Agreement, the Security Agreement
Supplements, the Mortgages, any Account Control Agreement and all other
supplemental or additional security agreements, mortgages or similar instruments
(other than any UCC financing statements) delivered pursuant hereto or thereto.
"Concentration Accounts" has the meaning set forth in Section 6(a) of the
Security Agreement.
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"Condemnation Event" means any condemnation or other taking or temporary or
permanent requisition of any property, any interest therein or right appurtenant
thereto, or any change of grade affecting any property, as the result of the
exercise of any right of condemnation or eminent domain. A transfer to a
governmental authority in lieu or anticipation of condemnation shall be deemed
to be a Condemnation Event.
"Consolidated Capital Expenditures" means, for any period, the gross
additions to property, plant and equipment and other capital expenditures of the
Issuer and its Restricted Subsidiaries for such period, as the same are or would
be reflected in a consolidated statement of cash flows of the Issuer and its
Restricted Subsidiaries for such period; provided that the amount paid by the
Issuer or any Restricted Subsidiary for any Acquisition and any amount of
Reinvestable Proceeds applied pursuant to clauses (A)(3) or (A)(4) of Section
2.06(a) shall not be included in the calculation of the amount of Consolidated
Capital Expenditures.
"Consolidated Debt for Borrowed Money" means at any date the sum, without
duplication, of (x) the aggregate amount of Debt of the types described in
clauses (i), (ii) and (iv) of the definition of "Debt" which is Debt of the
Issuer and its Restricted Subsidiaries, (y) the aggregate amount of Debt of the
type described in clause (vi) of the definition of "Debt" which is non-
contingent Debt of the Issuer and its Restricted Subsidiaries and (z) the
aggregate amount of Guarantees by the Issuer and its Restricted Subsidiaries
with respect to Debt of others of the types described in clauses (i), (ii) and
(iv) of the definition of Debt and non-contingent Debt of others of the type
described in clause (vi) of the definition of Debt, all determined on a
consolidated basis as of such date after excluding accrued interest for the then
current period not yet due and payable.
"Consolidated EBITDA" means, for any period, Adjusted Consolidated Net
Income for such period plus, to the extent deducted in determining Adjusted
Consolidated Net Income for such period, the sum of (i) Consolidated Interest
Expense, (ii) income tax expense and (iii) depreciation, amortization and other
similar non-cash charges.
"Consolidated EBITDAR" means, for any period, Consolidated EBITDA for such
period plus, to the extent deducted in determining Consolidated EBITDA for such
period, the sum of (i) Consolidated Rental Expense and (ii) non-cash
compensation expense and minus (iii) any cash paid during such period in respect
of non-cash compensation expense accrued during any prior period; provided that
(x) Consolidated EBITDAR shall be calculated so as to exclude the effect of any
income or expense that (A) is classified as extraordinary, (B) is reported
separately as an unusual or non-recurring item, (C) is attributable to
discontinued operations or (D) represents the effect of an accounting change on
prior periods, in each case in
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accordance with GAAP, and (y) if any Restricted Subsidiary of the Issuer is
subject to a limitation (other than pursuant to the terms of the Financing
Documents or the Exit Facility Financing Documents) in any period binding on
such Restricted Subsidiary which limits such Restricted Subsidiary's ability to
pay dividends or make other distributions or pay any Debt owed to the Issuer or
any other Restricted Subsidiary, or to make loans or advances to the Issuer or
any other Restricted Subsidiary or to create incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues to secure the obligations
of the Issuer or any other Restricted Subsidiary under any Financing Document,
Consolidated EBITDAR for such period shall be adjusted to exclude any portion
thereof that is attributable to such Restricted Subsidiary and that, as a result
of such limitation, it would be prohibited from paying, directly or indirectly,
to the Issuer or any other Restricted Subsidiary at the end of such period.
"Consolidated Interest Expense" means, for any period, the interest expense
of the Issuer and its Restricted Subsidiaries, determined on a consolidated
basis for such period; provided that Consolidated Interest Expense shall not (i)
include interest capitalized in accordance with GAAP or (ii) be reduced by any
interest income.
"Consolidated Net Income" means, for any period, the net income of the
Issuer and its Restricted Subsidiaries, determined on a consolidated basis for
such period.
"Consolidated Net Worth" means, at any date, the consolidated stockholders'
equity of the Issuer and its Restricted Subsidiaries determined as of such date.
"Consolidated Rental Expense" means, for any period, the total rental
expense for operating leases of the Issuer and its Restricted Subsidiaries,
determined on a consolidated basis for such period; provided that Consolidated
Rental Expense shall not be reduced by any rental income.
"Consolidated Subsidiary" means, as to any Person at any date, any
Subsidiary or other entity the accounts of which would be consolidated with
those of such Person in its consolidated financial statements if such statements
were prepared as of such date. Unless otherwise specified, "Consolidated
Subsidiary" means a Consolidated Subsidiary of the Issuer.
"Cornerstone" means Cornerstone Insurance Company, a Cayman Islands
corporation.
"Court" means the United States Bankruptcy Court for the District of
Delaware.
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"Credit Parties" means the Issuer and the Guarantors, collectively.
"Custodian" means Xxxxx Fargo Bank Minnesota, N.A., which shall hold any
Note issued to in on the Effective Date as custodian on behalf of holders of
Senior Debt Claims in accordance with and subject to the terms of the Plan of
Reorganization until such holders become Lenders pursuant to Section 12.06.
"Debt" of any Person means, without duplication, (i) all obligations of
such Person for borrowed money, (ii) all obligations of such Person evidenced by
bonds, debentures, notes or other similar instruments, (iii) all obligations of
such Person to pay the deferred purchase price of property or services, (iv) all
obligations of such Person as lessee under Capital Leases, (v) all obligations
of such Person to purchase securities which arise out of or in connection with
the sale of the same or substantially similar securities, (vi) all obligations
of such Person (whether contingent or non-contingent) to reimburse any Lender or
other Person in respect of amounts paid under a letter of credit, banker's
acceptance or similar instrument, (vii) all obligations secured by a Lien on any
asset of such Person, whether or not such Debt is otherwise an obligation of
such Person, and (viii) all Guarantees by such Person of obligations of another
Person (each such Guarantee to constitute Debt in an amount equal to the maximum
amount of such other Person's obligations Guaranteed thereby); provided that
neither (a) trade accounts payable nor (b) amounts owed to patients or residents
arising in the ordinary course of business nor (c) obligations arising in
respect of insurance policies or performance or surety bonds which are not
themselves Guarantees of Debt (nor drafts, acceptances or similar instruments
evidencing the same nor obligations in respect of letters of credit supporting
the payment of the same) nor (d) guarantees of any obligation of the Issuer or a
Restricted Subsidiary pursuant to an operating lease shall constitute Debt.
"Default" means any condition or event that constitutes an Event of Default
or that with the giving of notice or lapse of time or both would, unless cured
or waived, become an Event of Default.
"Default Rate" means on any day the rate of interest that would be payable
on the Loans on such day pursuant to Section 2.02(b).
"Designated Equity Proceeds" has the meaning specified in Section 2.06(b).
"DIP Facility" means the Debtor-In-Possession Credit Agreement dated as of
September 13, 1999, as amended through the Closing Date, among certain of the
Credit Parties and the lenders and agents named therein.
"Disclosure Statement" means the Vencor Companies' Fourth Amended
Disclosure Statement dated December 14, 2000 filed with the Court.
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"Disclosure Statement Hearing" means the hearing held by the Court on
December 14, 2000 at which the Disclosure Statement was approved.
"Disqualified Equity Interests" means Equity Interests that by their terms
or upon the happening of any event are (a) required to be redeemed or redeemable
at the option of the holder prior to the Stated Maturity Date for consideration
other than Qualified Equity Interests or (b) convertible at the option of the
holder into Disqualified Equity Interests or exchangeable for Debt.
"dollars" or "$" means United States dollars or such other coin or currency
as shall be legal tender for the payment of public or private debt in the United
States.
"Eastern Time" means local time in the Eastern time zone of the United
States.
"EBITDA" means, when used with respect to any Healthcare Facility for any
period, the net income attributable to the operations of such Healthcare
Facility during such period, plus, to the extent deducted in determining such
net income, the sum of (i) interest expense, (ii) income tax expense and (iii)
depreciation, amortization and other similar non-cash charges.
"EBITDAR" means, when used with respect to any Healthcare Facility for any
period, the net income attributable to the operations of such Healthcare
Facility during such period, plus, to the extent deducted in determining such
net income, the sum of (i) interest expense, (ii) income tax expense, (iii)
rental expense and (iv) depreciation, amortization and other similar non-cash
charges; provided that EBITDAR shall be calculated so as to exclude the effect
of any income or expense that (A) is classified as extraordinary, (B) is
reported separately as an unusual or non-recurring item, (C) is attributable to
discontinued operations or (D) represents the effect of an accounting change on
prior periods, in each case in accordance with GAAP, as such amounts relate to
such Healthcare Facility for such period.
"Eligible Assignee" means any Person which is either (i) (a) a commercial
bank organized under the laws of the United States or any state thereof having
unimpaired capital and surplus of not less than $500,000,000; (b) a savings and
loan association or savings bank organized under the laws of the United States
or any state thereof having unimpaired capital and surplus of not less than
$500,000,000; (c) a commercial bank organized under the laws of any other
country or a political subdivision thereof having unimpaired capital and surplus
of not less than $500,000,000; provided that (x) such bank is acting through a
branch or agency located in the United States or (y) such bank is organized
under the laws of a country that is a member of the Organization for Economic
Cooperation and Development or a political subdivision of such country; or (d)
an "accredited investor" (as defined in
9
Regulation D under the Securities Act) which extends credit as one of its
businesses including, but not limited to, insurance companies, mutual funds and
lease financing companies and having unimpaired capital and surplus of not less
than $100,000,000; or (ii) a Lender or an Affiliate of a Lender; provided that
no Vencor Company, no Ventas Company and no Affiliate of any of them shall be an
Eligible Assignee; and provided further that Eligible Assignee shall mean and
include any other Person designated as such pursuant to the prior written
consent of the Administrative Agent (such consent not to be unreasonably
withheld or delayed).
"Encumbrance Letter" means Vencor's letter dated the date hereof addressed
to Xxxxxx, as Collateral Agent and Exit Facility Collateral Agent, and First
American Title Insurance Company.
"Enforceable Judgment" means a judgment or order of a court or arbitral or
regulatory authority as to which the period, if any, during which the
enforcement of such judgment or order is stayed shall have expired. A judgment
or order which is under appeal or as to which the time in which to perfect an
appeal has not expired shall not be deemed an Enforceable Judgment so long as
enforcement thereof is effectively stayed pending the outcome of such appeal or
the expiration of such period, as the case may be.
"Enforcement Notice" means a notice delivered by the Administrative Agent to
the Collateral Agent pursuant to Section 8.03 directing the Collateral Agent to
exercise one or more specific rights or remedies under the Collateral Documents.
"Environmental Laws" means any and all federal, state, local and foreign
statutes, laws, judicial decisions, regulations, ordinances, rules, judgments,
orders, decrees, codes, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and governmental restrictions relating to the
environment or to the effect of the environment on human health or to emissions,
discharges or releases of pollutants, contaminants, Hazardous Substances or
wastes into the environment, including ambient air, surface water, ground water
or land, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of pollutants,
contaminants, Hazardous Substances or wastes or the clean-up or other
remediation thereof.
"Environmental Liabilities" means any and all liabilities of or relating to
the Issuer or any of the Guarantors (including any entity which is, in whole or
in part, a predecessor of the Issuer or any of the Guarantors), whether vested
or unvested, contingent or fixed, actual or potential, known or unknown, which
arise under or relate to matters covered by Environmental Laws.
10
"Equity Interest" means (i) in the case of a corporation, any shares of its
capital stock, (ii) in the case of a limited liability company, any membership
interest therein, (iii) in the case of a partnership, any partnership interest
(whether general or limited) therein, (iv) in the case of any other business
entity, any participation or other interest in the equity or profits thereof or
(v) any warrant, option or other right to acquire any Equity Interest described
in the foregoing clauses (i), (ii), (iii) and (iv).
"Equity Issuance" means any issuance or sale by Vencor of any Equity
Interest in Vencor other than (i) Equity Interests issued to or otherwise
acquired by directors, officers and employees of Vencor or any of its
Subsidiaries pursuant to stock option, restricted stock and similar compensation
plans approved by the Board of Directors of Vencor or (ii) Equity Interests
issued as contemplated by the Plan of Reorganization (including without
limitation common stock of Vencor issued upon the exercise of New Warrants).
"Equity Receipt Date" has the meaning set forth in Section 2.06(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute.
"ERISA Group" means the Vencor Companies and all members of a controlled
group of corporations and all trades or businesses (whether or not incorporated)
under common control which, together with any Vencor Company, are treated as a
single employer under Section 414 of the Internal Revenue Code.
"Escrow Agreement" means the Escrow Agreement dated as of the date hereof
among the Issuer, Vencor, the Collateral Agent and First American Title
Insurance Company, as escrow agent, as in effect on the date hereof.
"Euro-Dollar Business Day" means any Business Day on which commercial banks
are open for international business (including dealings in dollar deposits) in
London.
"Euro-Dollar Margin" means a per annum rate equal to 4.50%.
"Event of Default" means any event defined as an "Event of Default" in
Section 8.01.
"Excluded Partnership" means each of the general and limited partnerships
and each of the limited liability companies identified on Schedule 1 hereto as
an Excluded Partnership; provided that any such partnership or limited liability
company shall cease to be an Excluded Partnership at such time as (i) the grant
of a security interest in the partnership interests or limited liability company
interests thereof and a
11
guaranty of the Obligations by such entity shall no longer constitute a material
violation of a valid and enforceable restriction in favor of a third party or
(ii) the required consents to such grant and such guaranty shall have been
obtained.
"Excluded PIP Repayments" means any optional repayment of the principal of
the PIP Claim that are (a) directly funded with the Net Cash Proceeds of an
Asset Sale or Equity Issuance or a payment out of the original amount deposited
and held in escrow under the Tax Refund Escrow Agreement or (b) made at a time
when the aggregate cash balances of the Issuer and its Restricted Subsidiaries
as of the last Business Day of the most recently ended month exceed $100,000,000
(as reflected in the Issuer's consolidated balance sheet as at the end of such
month and consistent with the Issuer's historical cash management practices).
"Executive Officer" means any "executive officer" (within the meaning of
Rule 3b-7 under the Securities Exchange Act) of the Issuer.
"Existing Affiliate Agreements" means the agreements listed in Schedule 2
hereto.
"Exit Facility" means the $120,000,000 Credit Agreement dated as of the
date hereof among Vencor, the Issuer and the financial institutions party
thereto, under which Xxxxxx (or its successors or assigns in such capacity) acts
as administrative agent and collateral agent, as the same may be amended,
restated, supplemented or otherwise modified from time to time, together with
all replacements, refinancings, refundings and renewals thereof from time to
time; provided that (i) the principal amount of the Exit Facility shall not at
any time exceed $120,000,000 less any amounts up to an aggregate of $45,000,000
by which the commitments under the Exit Facility have been permanently reduced;
provided further that the principal amount of the Exit Facility as refinanced,
refunded or renewed may be increased to the aggregate amount of the commitments
under the Exit Facility immediately prior to such refinancing, refunding or
renewal, regardless of the amount outstanding under the Exit Facility at such
time and (ii) there shall at any time be only a single credit facility to which
the Issuer is a party which constitutes the "Exit Facility".
"Exit Facility Agent" means at any time the Person acting as the
administrative agent under the Exit Facility then in effect.
"Exit Facility Collateral Account" means a collateral account maintained by
the Exit Facility Collateral Agent pursuant to the Exit Facility.
"Exit Facility Collateral Agent" means at any time the Person acting as the
collateral agent under the Exit Facility then in effect.
12
"Exit Facility Financing Documents" means, collectively, the "Financing
Documents" as such term is defined in the Exit Facility, in each case, as the
same may be amended, restated, supplemented or otherwise modified from time to
time, together with all replacements thereof.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest l/l00th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day, provided that (i) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (ii) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate quoted to the
Administrative Agent on such day on such transactions as determined by the
Administrative Agent.
"Fee Mortgages" means fee mortgages substantially in the form of Exhibit G
to the Security Agreement relating to (i) the Owned Properties and (ii) any
other real property owned in fee by the Issuer or any Guarantor which is
required to be so encumbered to secure the Obligations pursuant to Section 5.09.
"Financial Accommodations" means arrangements for the extension of credit
or other financial accommodation to the Issuer or one or more of the Guarantors,
including committed or uncommitted lines of credit for advances or other
financial accommodation, letters of credit, performance and surety bonds and the
like, committed or uncommitted agreements for the purchase of accounts
receivable or other financial assets, with or without recourse or repurchase
obligation, forward and future contracts for purchase of bullion or foreign
currencies and other similar arrangements and interest rate swaps and other
similar arrangements, but excluding (i) trade accounts payable arising in the
ordinary course of business and (ii) Debt under this Agreement.
"Financial Officer" means the principal financial officer, principal
accounting officer or treasurer of the Issuer.
"Financing Documents" means this Agreement (including the Schedules and
Exhibits hereto), the Notes, the Guaranty Agreements and the Collateral
Documents.
"Fiscal Quarter" means a fiscal quarter of the Issuer or of Vencor, as the
context may require.
13
"Fiscal Year" means a fiscal year of the Issuer or of Vencor, as the context
may require.
"Fixed Charge Coverage Ratio (EBITDA)" means, on any date (the "transaction
date"), the ratio of (x) Consolidated EBlTDA for the four consecutive Fiscal
Quarters ended immediately prior to the transaction date (the "reference
period") to (y) Consolidated Interest Expense for the reference period; provided
that, at any transaction date prior to the end of the fourth full Fiscal Quarter
following the Closing Date, the foregoing amounts shall be determined as of the
end of the then most recently ended Fiscal Quarter on an Annualized Basis. In
making the foregoing calculation,
(a) pro forma effect will be given to any Debt incurred during or
after the reference period to the extent the Debt is outstanding or is to be
incurred on the transaction date as if the Debt had been incurred on the
first day of the reference period;
(b) pro forma calculations of interest on Debt bearing a floating
interest rate will be made as if the rate in effect on the transaction date
(taking into account any Interest Rate Agreement applicable to the Debt if
the Interest Rate Agreement has a remaining term of at least 12 months) had
been the applicable rate for the entire reference period;
(c) Consolidated Interest Expense related to any Debt no longer
outstanding or to be repaid or redeemed on the transaction date, except for
Consolidated Interest Expense accrued during the reference period under the
Exit Facility to the extent of the commitment thereunder in effect on the
transaction date, will be excluded;
(d) pro forma effect will be given to
(i) the creation, designation or redesignation of Restricted and
Unrestricted Subsidiaries,
(ii) the acquisition or disposition of companies, divisions or
lines of businesses by the Issuer and its Restricted Subsidiaries,
including any acquisition or disposition of a company, division or line
of business since the beginning of the reference period by a Person
that became a Restricted Subsidiary after the beginning of the
reference period, and
(iii) the discontinuation of any discontinued operations,
14
that have occurred since the beginning of the reference period as if
such events had occurred, and, in the case of any disposition, the
proceeds thereof applied, on the first day of the reference period. To
the extent that pro forma effect is to be given to an acquisition or
disposition of a company, division or line of business, the pro forma
calculation will be based upon the most recent four full fiscal
quarters for which the relevant financial information is available.
"Forgiveness Amount", as of any date prior to the Interest Commencement
Date then in effect upon which:
(a) the principal amount of the Loans is being repaid in full
(the "Final Prepayment Date"), whether at the option of the Issuer,
mandatorily or upon acceleration, means a portion of the then
outstanding principal amount of the Loans determined as follows: (i)
determine the aggregate amount of interest that would have accrued on
the principal amount of the Loans outstanding from time to time during
the period beginning on the Closing Date and ending on the Final
Prepayment Date, at the rate of interest determined pursuant to clause
(a) of the definition of Number of Deferral Days; and (ii) subtract
from $15,900,000 the sum of (A) the amount determined pursuant to
clause (i) and (B) the aggregate Forgiveness Amounts, if any,
determined for any preceding Partial Prepayment Dates, which resulting
amount shall be the Forgiveness Amount; and
(b) the principal amount of the Loans is being repaid in part (a
"Partial Prepayment Date"), whether at the option of the Issuer, mandatorily or
upon acceleration, means a portion of the then outstanding principal amount of
the Loans determined as follows: (i) determine the aggregate amount of interest
that would have accrued to such Partial Prepayment Date and would accrue from
such Partial Payment Date to the Interest Commencement Date (as re-set pursuant
to the proviso in the definition of Number of Deferral Days on account of such
partial prepayment) on the principal amount of the Loans outstanding from time
to time during the period beginning on the Closing Date through the Interest
Commencement Date (taking into account the principal amount of the Loans
proposed be repaid on such Partial Prepayment Date (the "Proposed Prepayment")
and the aggregate Forgiveness Amounts, if any, determined for any preceding
Partial Prepayment Dates, but otherwise assuming for this purpose no further
prepayments or forgiveness of principal prior to such Interest Commencement
Date), at the rate of interest determined pursuant to clause (a) of the
definition of Number of Deferral Days; (ii) add (A) the amount determined
pursuant to clause (i) and (B) the aggregate Forgiveness Amounts, if any,
determined for any preceding Partial Prepayment Dates; (iii) if the amount
determined pursuant to clause (ii) is equal to or greater than $15,900,000, the
applicable Forgiveness Amount shall
15
be zero; and (iv) if the amount determined pursuant to clause (ii) is less than
$15,900,000, then the applicable Forgiveness Amount shall be such amount which,
when subtracted from the principal amount of the Loans that would be outstanding
after giving effect to the Proposed Prepayment, would result in a pro forma
calculation pursuant to clauses (i) and (ii) in which the pro forma Forgiveness
Amount is zero pursuant to clause (iii).
"Free Cash Flow" means, for any period, the sum (without duplication) of
(i) Consolidated EBITDA for such period minus (ii) Consolidated Capital
Expenditures for such period minus (iii) the cash consideration paid to make any
Acquisition during such period (excluding cash paid by the application of
Reinvestable Proceeds pursuant to clause (A)(4) of Section 2.06(a) or by the
application of amounts transferred to the Issuer pursuant to Section 2.06(b))
minus (iv) cash interest payable by the Issuer and its Restricted Subsidiaries
with respect to such period minus (v) the amount of cash income taxes payable by
the Issuer and its Restricted Subsidiaries with respect to such period and minus
(vi) the aggregate principal amount of Debt repaid by the Issuer and its
Restricted Subsidiaries during such period, excluding (1) repayments of loans
under the Exit Facility to the extent the commitments thereunder would permit
the amount repaid to be reborrowed and (2) Excluded PIP Repayments; provided
that the deduction for Consolidated Capital Expenditures for the first, second
and third Fiscal Quarters of a Fiscal Year will be the greater of (x) one-
quarter, one-half and three-quarters, as the case may be, of the actual budgeted
amount of Consolidated Capital Expenditure for such Fiscal Year (such budgeted
amount not to exceed the amount set forth in Section 6.04 opposite such Fiscal
Year) and (x) the actual Consolidated Capital Expenditures for such Fiscal
Quarter.
"GAAP" means at any time generally accepted accounting principles as then
in effect in the United States, applied on a basis consistent (except for
changes concurred in by the Issuer's independent public accountants) with the
Most Recent Audited Financial Statements.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt of any other Person
and,
16
without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt (whether
arising by virtue of partnership arrangements, by agreement to keep-well, to
purchase assets, goods, securities or services, to take-or-pay, or to maintain
financial statement conditions or otherwise), (ii) to reimburse a bank for
drawings under a letter of credit for the purpose of paying such Debt or (iii)
entered into for the purpose of assuring in any other manner the holder of such
Debt of the payment thereof or to protect such holder against loss in respect
thereof (in whole or in part); provided that the term "Guarantee" shall not
include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee", when used as a verb, has a corresponding
meaning.
"Guarantors" means Vencor and the Subsidiary Guarantors.
"Guaranty Agreements" means the Vencor Guaranty Agreement and the
Subsidiary Guaranty Agreements.
"Hazardous Substances" means any toxic, radioactive, corrosive or otherwise
hazardous substance, including petroleum, its derivatives, by-products and other
hydrocarbons, or any substance having any constituent elements displaying any of
the foregoing characteristics, whether or not regulated under Environmental
Laws.
"Healthcare Facility" means (i) a hospital, outpatient clinic, nursing
center, assisted or independent living community, long-term care facility or any
other facility that is used or useful in the provision of healthcare or
custodial care services, (ii) any healthcare business affiliated or associated
with a Healthcare Facility (as defined in clause (i)) or (iii) any business
related or ancillary to the provision of healthcare services or the operation of
a Healthcare Facility (as defined in clause (i)) including, but not limited to,
contract therapy services, as well as hospice and home care services.
"Indemnitee" has the meaning set forth in Section 12.03(b).
"Initial Lender Schedule" means the Initial Lender Schedule attached
hereto.
"Initial Master Lease Properties" means the Healthcare Facilities
identified as the "Initial Master Lease Properties" on Schedule 4 hereto.
"Insurance Subsidiary" means any insurance company that becomes a
Subsidiary of the Issuer on or after the Closing Date.
17
"Intercreditor Agreement" means a Subordination and Intercreditor Agreement
among the Issuer, Vencor, the Collateral Agent and the Exit Facility Collateral
Agent, substantially in the form of Exhibit E hereto.
"Interest Commencement Date" means the earlier of (a) the date that is the
Number of Deferral Days after the Closing Date and (b) the date, if ever, upon
which an Event of Default described in Section 8.01(n) involving the Issuer or
Vencor occurs.
"Interest Period" means with respect to each Loan, a period commencing on
the date specified in the applicable Notice of Interest Rate Election and ending
one, two, three or six months thereafter, as the Issuer may elect in the
applicable notice; provided that:
(a) any Interest Period that would otherwise end on a day that is not
a Euro-Dollar Business Day shall be extended to the next succeeding Euro-
Dollar Business Day unless such day falls in another calendar month, in
which case such Interest Period shall end on the next preceding Euro-Dollar
Business Day;
(b) any Interest Period that begins on the last Euro-Dollar Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to clause (c) of this proviso, end on the last Euro-Dollar
Business Day of a calendar month; and
(c) any Interest Period that would otherwise end after the Stated
Maturity Date shall end on the Stated Maturity Date.
"Interest Rate Agreement" means any interest rate protection agreement,
interest rate future, interest rate option, interest rate swap, interest rate
cap or other interest rate hedge arrangement, to or under which the Issuer or
any of its Restricted Subsidiaries is a party or a beneficiary on the date
hereof or becomes a party or a beneficiary hereafter.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor statute.
"Investment" means, with respect to any Person (the "Investor"), any
investment by the Investor in any other Person, whether by means of share
purchase, capital contribution, loan, advance, purchase of Debt, payment in
respect of a Guarantee of Debt, time deposit or otherwise.
18
"Issuer" has the meaning set forth in the introduction to this Agreement.
"Kingfish Transaction" means the proposed sale by Vencor and certain of its
Subsidiaries of the Kingfish Properties (as defined in the motion for entry of
an order filed by Vencor and certain of its Subsidiaries with the Court on
November 10, 1999 (the "Kingfish Motion"), as the same may be amended from time
to time so long as the motion as so amended shall not reflect any change from
the Kingfish Motion that, in the reasonable judgment of the Required Lenders, is
adverse in any material respect to the Issuer or any Guarantor or to the
Lenders) (i) in accordance with the order of the Court approving such sale or
(ii) at any time on or after the Effective Date, substantially in accordance
with the memorandum describing such sale delivered to the Administrative Agent
on or prior to the date hereof.
"Leasehold Mortgages" means leasehold mortgages, substantially in the form
of Exhibit F to the Security Agreement, relating to (i) the Initial Master Lease
Properties and the Other Leased Properties and (ii) leases of any other real
properties leased by the Issuer or any Guarantor which are required to be so
encumbered to secure the Obligations pursuant to Section 5.09.
"Lender" means initially the Custodian and, thereafter, each holder of
Senior Debt Claims and each Assignee which becomes a "Lender" for purposes
hereof pursuant to Section 12.06, and their respective successors.
"Lender Parties" means the Lenders and the Agents.
"Lending Office" means, as to each Lender, its office located at its address
set forth in its Administrative Questionnaire (or identified in its
Administrative Questionnaire as its Lending Office) or such other office as such
Lender may hereafter designate as its Lending Office by notice to the Issuer and
the Administrative Agent.
"Lien" means, with respect to any asset, any mortgage, lien, pledge, charge,
security interest or encumbrance of any kind in respect of such asset or any
other arrangement (other than a right of set-off, recoupment, counterclaim or
similar right) the economic effect of which is to give a creditor preferential
access to such asset to satisfy its claim. For purposes of this Agreement, the
Issuer and any Guarantor shall be deemed to own subject to a Lien any asset that
it has acquired or holds subject to the interest of a vendor or lessor under any
conditional sale agreement or other title retention agreement relating to such
asset or any Capital Lease.
"Lien Grantor" means the Issuer or a Guarantor that grants a Lien on any of
its property pursuant to the Collateral Documents.
19
"Loans" means the aggregate principal amount of the indebtedness of the
Issuer evidenced by the Notes.
"Management Contracts" means the management contracts pursuant to which the
Issuer and the Guarantors manage Healthcare Facilities as set forth in Schedule
5 hereto.
"Margin Stock" has the meaning set forth in Regulation U.
"Master Lease Agreements" means the Amended Ventas Leases and any lease
agreements pursuant to which one or more Master Lease Leased Properties (as
defined in the Amended Ventas Leases) are leased, whether under an Amended
Ventas Lease or other leases pursuant to the terms of such Amended Ventas
Leases, in each case, as amended from time to time after the Closing Date in
accordance with the terms thereof.
"Master Lease Property" means (i) the Initial Master Lease Properties and
(ii) any properties added after the Closing Date to the properties leased under
a Master Lease Agreement.
"Material Adverse Effect" means a material adverse effect on (i) the
business, condition (financial or otherwise), results of operations, performance
or properties of (A) prior to the Closing Date, Vencor and its Subsidiaries and
(B) on and after the Closing Date, the Issuer and its Restricted Subsidiaries,
in each case, taken as a whole, since September 30, 2000, (ii) the validity,
binding effect or enforceability of any Financing Document, (iii) the validity,
perfection or priority of the Liens on any material part of the Collateral
created or purportedly created under the Collateral Documents or (iv) the
ability of the Issuer or Vencor, or the ability of the Restricted Subsidiaries
taken as a whole, to perform their respective obligations under any Financing
Document; provided that a Material Adverse Effect shall not be deemed to have
occurred solely on account of (a) any events, occurrences and circumstances set
forth in the Disclosure Statement, (b) the commencement or continuation of the
Chapter 11 Cases and (c) the termination of the lease of one or more Healthcare
Facilities under a Master Lease Agreement, or the surrender or repossession of
one or more Healthcare Facilities leased thereunder, prior to the scheduled
termination thereof (the Fiscal Quarter in which such termination, surrender or
repossession occurs, the "Current Fiscal Quarter"), unless the EBITDAR
attributable to all Healthcare Facilities then being terminated, surrendered or
repossessed (other than in respect of any voluntary termination of a lease of a
Healthcare Facility at a time when no Event of Default (as defined in the Master
Lease Agreement) exists thereunder or is reasonably likely to occur or any
termination of a lease of a Healthcare Facility pursuant to a purchase option
exercised in accordance with the terms thereof), and the EBITDAR attributable to
all Healthcare
20
Facilities with respect to which such a termination, surrender or repossession
occurred during the Current Fiscal Quarter and the most recently ended period of
four consecutive Fiscal Quarters exceed, in the aggregate, 5% of Consolidated
EBITDAR during such period of four consecutive Fiscal Quarters (the foregoing
amounts to be calculated in accordance with Section 8.01(h)).
"Material Debt" means Debt (other than Debt arising under this Agreement)
of the Issuer or one or more of the Guarantors, arising in one or more related
or unrelated transactions, in an aggregate outstanding amount (excluding accrued
interest) of $5,000,000 or more.
"Material Plan" means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $1,000,000.
"Material Real Property" means (i) any real property with a fair market
value exceeding, in the case of real property relating to a Healthcare Facility
that is a hospital, $6,000,000, or in the case of any other real property,
$3,000,000, in either case, which is acquired by the Issuer or a Guarantor after
the Closing Date and not sold to a Person (other than the Issuer or a Guarantor)
within 90 days after such acquisition or (ii) any real property leased to the
Issuer or a Guarantor for the first time after the Closing Date if the projected
EBITDA (as reasonably estimated by a Financial Officer) for the Healthcare
Facility to which such lease relates for the twelve months following the date on
which a leasehold report is delivered to the Administrative Agent pursuant to
Section 5.09(c) is equal to or exceeds $l,000,000 with respect to any leased
Healthcare Facility that is a hospital and $500,000 with respect to any other
leased Healthcare Facility.
"Medicaid" means the medical assistance program established by Title XIX of
the Social Security Act (42 U.S.C. (S)(S) 1396 et seq.) and any statutes
succeeding thereto.
"Medicaid Regulations" means, collectively, (i) all federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting Medicaid, (ii) all applicable provisions of all federal rules,
regulations, manuals and orders all of Governmental Authorities promulgated
pursuant to or in connection with the statutes described in clause (i) above and
all federal administrative, reimbursement and other guidelines of all
Governmental Authorities having the force of law promulgated pursuant to or in
connection with the statutes described in clause (i) above, (iii) all state
statutes and plans for medical assistance enacted in connection with the
statutes and provisions described in clauses (i) and (ii) above, and (iv) all
applicable provisions of all rules, regulations, manuals and orders of all
Governmental Authorities promulgated pursuant to or in connection with the
statutes described in clause (iii) above and all state administrative,
reimbursement and other guidelines of
21
all Governmental Authorities having the force of law promulgated pursuant to or
in connection with the statutes described in clause (iii) above, in each case as
may be amended or supplemented.
"Medicare" means the health insurance program for the aged and disabled
established by Title XVIII of the Social Security Act (42 U.S.C. (S)(S) 1995 et
seq.) and any statutes succeeding thereto.
"Medicare Regulations" means, collectively, all federal statutes (whether
set forth in Title XVIII of the Social Security Act or elsewhere) affecting
Medicare, together with all applicable provisions of all rules, regulations,
manuals and orders and administrative, reimbursement and other guidelines having
the force of law of all Governmental Authorities (including without limitation,
Health and Human Services ("HHS"), Health Care Finance Administration, the
Office of the Inspector General for HHS, or any Person succeeding to the
functions of any of the foregoing) promulgated pursuant to or in connection with
any of the foregoing having the force of law, as each may be amended or
supplemented.
"Minority-Owned Affiliate" means any Person (other than a Restricted
Subsidiary) in which (i) the Issuer and its Restricted Subsidiaries own 10% or
more of any class of capital stock or other Equity Interests or (ii) the Issuer
or any Restricted Subsidiary is a general partner.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Xxxxxx" means Xxxxxx Guaranty Trust Company of New York and its successors
and assigns.
"Mortgages" means the Leasehold Mortgages and Fee Mortgages, collectively.
"Most Recent Audited Financial Statements" means (i) at any time before
audited consolidated financial statements of the Issuer and its Restricted
Subsidiaries have been delivered pursuant to Section 5.01(a), the audited
consolidated financial statements of Vencor and its Consolidated Subsidiaries as
of December 31, 2000 and (ii) at any time after audited consolidated financial
statements of the Issuer and its Restricted Subsidiaries have been delivered
pursuant to Section 5.01 (a), the most recent audited consolidated financial
statements of the Issuer and its Restricted Subsidiaries so delivered.
"Most Recent Financial Statements" means (i) at any time before
consolidated financial statements of the Issuer and its Restricted Subsidiaries
(whether audited or unaudited) have been delivered pursuant to Section 5.01(a)
or
22
Section 5.01(b), the audited consolidated financial statements of Vencor and its
Consolidated Subsidiaries as of December 31, 2000, and upon delivery pursuant to
Section 5.01(a), the consolidated financial statements of Vencor and its
Consolidated Subsidiaries as of March 31, 2001 and (ii) at any time after
consolidated financial statements of the Issuer and its Restricted Subsidiaries
have been delivered pursuant to Section 5.01(a) or Section 5.01(b), the most
recent consolidated financial statements of the Issuer and its Restricted
Subsidiaries so delivered.
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.
"Net Cash Proceeds" means, with respect to any Asset Sale (other than the
Kingfish Transaction) or Equity Issuance, an amount equal to the cash proceeds
received by the Issuer and its Restricted Subsidiaries in respect of such Asset
Sale or by Vencor in respect of such Equity Issuance (including any cash
proceeds received as income or other cash proceeds of any noncash proceeds of
such Asset Sale), less:
(i) any expenses reasonably incurred by the Issuer and its Restricted
Subsidiaries in respect of such Asset Sale or by Vencor in respect of such
Equity Issuance (including reasonable attorneys' fees and expenses); and
(ii) in the case of any Asset Sale, (x) the amount of any Debt secured by a
Lien on any asset disposed of in such Asset Sale and discharged from the
proceeds thereof and (y) any payment with respect to taxes actually paid or to
become payable by the Issuer and its Restricted Subsidiaries (as reasonably
estimated by a Financial Officer) in respect of such Asset Sale.
"Non-Recourse Debt" means Debt as to which (i) neither the Issuer nor any
Restricted Subsidiary provides any Guarantee and as to which the lenders have
been notified in writing that they will not have any recourse to the stock or
assets of the Issuer or any Restricted Subsidiary and (ii) no default thereunder
would, as such, constitute a default under any Debt of the Issuer or any
Restricted Subsidiary.
"Note" means a senior secured promissory note of the Issuer payable to a
Lender pursuant to the terms of this Agreement and substantially in the form of
Exhibit A hereto. "Notes" means any or all of such promissory notes, as the
context may require.
"Notice of Interest Rate Election" has the meaning set forth in Section
2.03.
23
"Number of Deferral Days" means a number of days determined as follows: (a)
determine the rate of interest that would be applicable to the Loans in
accordance with Section 2.02(a) (but for the proviso in the first paragraph of
such Section) for an initial Interest Period of six months beginning on the
Closing Date; (b) calculate the amount of interest that would accrue per day on
the initial principal amount of the Loans beginning with the Closing Date at the
rate of interest determined pursuant to clause (a); and (c) divide $15,900,000
by the amount of interest per day determined pursuant to clause (b), rounding
the quotient to the next highest whole number, which number shall be the Number
of Deferral Days, provided that if the principal amount of the Loans is repaid
in part (other than after an Event of Default described in Section 8.01(n)
involving the Issuer or Vencor has occurred), whether at the option of the
Issuer, mandatorily or upon acceleration, on a date prior to the Interest
Commencement Date then in effect (it being understood that successive repayments
of the principal of the Loans will result in successive re-determinations of the
Number of Deferral Days and re-settings of the Interest Commencement Date),
whether at the option of the Issuer, mandatorily or upon acceleration, the
Number of Deferral Days shall be re-determined using the amount of interest that
would accrue after such date on the reduced principal amount of the Loans so
that the Number of Deferral Days reflects an aggregate amount of interest that
would have accrued after the Closing Date equal to $15,900,000, provided further
that no re-set Interest Commencement Date may be later than the Stated Maturity
Date.
"Obligations" means all obligations of every nature of the Issuer or any
Guarantor under the Financing Documents, including, without limitation, any
liability of the Issuer on any claim, whether or not the right to payment in
respect of such claim is reduced to judgment, liquidated, unliquidated, fixed or
contingent, matured, disputed, undisputed, legal, equitable, secured or
unsecured, and whether or not such claim is discharged, stayed or otherwise
affected by any bankruptcy, insolvency, reorganization or other similar
proceeding. Without limiting the generality of the foregoing, the Obligations of
the Issuer and a Guarantor under the Financing Documents include (a) the
obligation to pay principal, interest, charges, expenses, fees, attorneys' fees
and disbursements, indemnities and other amounts payable by the Issuer or such
Guarantor under any Financing Document and (b) the obligation to reimburse any
amount in respect of any of the foregoing that any Agent or any Lender, in its
sole discretion, may elect to pay or advance on behalf of the Issuer or such
Guarantor in accordance with the terms of any Financing Document.
"Organizational Documents" means (i) with respect to any corporation, its
certificate or articles of incorporation, by-laws and other constitutional
documents, including the certificate of designation for any series of its
preferred stock, (ii) with respect to any limited liability company, its
articles of organization and operating agreement, or other comparable documents
however named, and (iii) with respect to any partnership, its partnership
agreement.
24
"Other Leased Properties" means the Healthcare Facilities identified as the
"Other Leased Properties" on Schedule 4 hereto.
"Owned Properties" means each of the Healthcare Facilities identified as
the "Owned Properties" on Schedule 3 hereto.
"Parent" means, with respect to any Lender, any Person controlling such
Lender.
"Participant" has the meaning set forth in Section 12.06(b).
"Payment Blockage Period" has the meaning set forth in Section 11.03(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Permitted Encumbrances" means, with respect to any property (including any
leasehold interest) owned by the Issuer or any Restricted Subsidiary:
(a) Liens for taxes, assessments or other governmental charges not yet due
or which are being contested in good faith and by appropriate proceedings if
adequate reserves with respect thereto are maintained on the books of the Issuer
or such Restricted Subsidiary in accordance with GAAP;
(b) carriers', warehousemen's, mechanics', materialmens, repairmens' or
other like Liens arising by operation of law in the ordinary course of business
so long as (A) the underlying obligations are not overdue for a period of more
than 60 days or (B) such Liens are being contested in good faith and by
appropriate proceedings and adequate reserves with respect thereto are
maintained on the books of the Issuer or such Restricted Subsidiary in
accordance with GAAP;
(c) Liens arising in the ordinary course of business and consistent with
past practice in connection with deposits with trade creditors, landlords,
bonding companies and other similar deposits;
(d) Liens arising in the ordinary course of business in connection with
the Issuer's cash management system; provided that the aggregate principal
amount of Debt secured by this clause (d) shall not at any time exceed
$10,000,000;
(e) judgment liens, and Liens securing appeal bonds or letters of credit
issued in support of or in lieu of appeal bonds, so long as no Event of Default
then exists under Section 8.01(k);
25
(f) other Liens or title defects in respect of real property (including
matters which an accurate survey might disclose and exceptions to title set
forth in title insurance with respect to the Mortgages) which (A) do not secure
Debt and (B) do not materially detract from the value of such property or
materially impair the use thereof by the Issuer or such Restricted Subsidiary in
the operation of its business; and
(g) other Liens and other title defects listed on the schedule to the
Encumbrance Letter; provided that such Liens and title defects are paid,
discharged, removed or reserved against in accordance with the provisions of,
and within the time periods (if any) specified in, the Encumbrance Letter.
"Permitted Intercompany Debt" means Debt of the Issuer or any Restricted
Subsidiary owed to the Issuer or any Wholly Owned Restricted Subsidiary so long
as such Debt continues to be owed to the Issuer or any Wholly Owned Restricted
Subsidiary; provided that such Debt is either evidenced by a promissory note
(which note shall be subordinated to the Obligations in a manner reasonably
satisfactory to the Collateral Agent) or maintained in the form of open account
balances in which, in either case, the Collateral Agent has a perfected security
interest under the Security Agreement at all times until such security interest
is released pursuant to Section 18 thereof.
"Permitted Investment" means:
(a) Investments existing on the Closing Date and set forth in Schedule 6
hereto;
(b) Temporary Cash Investments;
(c) any Investment in a then-existing Restricted Subsidiary;
(d) payroll, travel and other advances to directors, officers and
employees, in each case in the ordinary course of business, not in excess of
$1,000,000 outstanding at any time; provided that taxes payable in connection
with the issuance of Equity Interests of Vencor in the ordinary course of
business to such directors, officers and employees shall be excluded from the
calculation of the amount of Investments outstanding under this clause (d) so
long as such taxes are not owing for more than 30 days;
(e) working capital loans to, and other Investments in, Minority-Owned
Affiliates and any other Investment in any Person engaged in any business
related to or ancillary to the provision of healthcare services or the operation
of a Healthcare Facility (as defined in clause (i) of the definition of
"Healthcare Facility"), so long as the aggregate amount of all Investments made
after the Closing Date pursuant to this
26
clause (e) outstanding at any time during each of the periods referred to below
shall not exceed the amount set forth opposite such period:
--------------------------------------------------------------------------------
Period Amount
--------------------------------------------------------------------------------
Closing Date to but excluding first anniversary thereof: $1,000,000
--------------------------------------------------------------------------------
First anniversary of Closing Date to but excluding second $2,000,000
anniversary thereof:
--------------------------------------------------------------------------------
Second anniversary of Closing Date to but excluding third $3,000,000
anniversary thereof:
--------------------------------------------------------------------------------
Third anniversary of Closing Date to but excluding fourth $4,000,000
anniversary thereof:
--------------------------------------------------------------------------------
Thereafter: $5,000,000
--------------------------------------------------------------------------------
(f) Investments received as non-cash consideration in an Asset Sale made
pursuant to and in compliance with Section 7.03(d).
"Permitted Liens" means Liens permitted to exist under Section 7.02.
"Permitted Taxes" means all taxes, however denominated, including any
interest, additions to tax or penalties that may become payable in respect
thereof, imposed by any federal, state, local or foreign government or any
agency or political subdivision of any such government, which taxes shall
include, without limiting the generality of the foregoing, all income taxes
(including, but not limited to, United States federal income taxes and state
income taxes), payroll and employee withholding taxes, unemployment insurance,
social security, severance, sales and use taxes, excise taxes, customs,
environmental, license, franchise taxes, gross receipts taxes, occupation taxes,
real and personal property taxes, capital taxes, stamp taxes, transfer taxes, ad
valorem taxes, withholding taxes, workers' compensation, estimated, alternative
or add-on minimum taxes, and other obligations of the same or of a similar
nature, whenever arising.
"Person" means an individual, a corporation, a limited liability company, a
partnership, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"Plan" means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for
27
employees of any member of the ERISA Group or (ii) has at any time within the
preceding five years been maintained, or contributed to, by any Person which was
at such time a member of the ERISA Group for employees of any Person which was
at such time a member of the ERISA Group.
"Plan of Reorganization" means the Fourth Amended Joint Plan of
Reorganization attached as Exhibit A to the Disclosure Statement (together with
the Plan Supplement), as amended through and including the Confirmation Date.
"Plan Supplement" means the Fourth Amended Plan Supplement relating to the
Plan of Reorganization filed with the Court on December 29, 2000.
"Proposed Purchase Price" has the meaning set forth in Section 2.06(b)(i).
"Qualification" means, with respect to any report of independent public
accountants covering financial statements, a qualification to such report (such
as a "subject to" or "except for" statement therein) (i) resulting from a
limitation on the scope of examination of such financial statements or the
underlying data, (ii) as to the capability of the Person whose financial
statements are being examined to continue operations as a going concern or (iii)
which could be eliminated by changes in financial statements or notes thereto
covered by such report (such as, by the creation of or increase in a reserve or
a decrease in the carrying value of assets); provided that neither of the
following shall constitute a Qualification: (a) a consistency exception relating
to a change in accounting principles with which the independent public
accountants for the Person whose financial statements are being examined have
concurred or (b) a qualification relating to the outcome or disposition of any
uncertainty, including but not limited to threatened litigation, pending
litigation being contested in good faith, pending or threatened claims or other
contingencies, the impact of which litigation, claims, contingencies or
uncertainties cannot be determined with sufficient certainty to permit
quantification in such financial statements.
"Qualified Equity Interests" means all Equity Interests of a Person other
than Disqualified Equity Interests.
"Quarterly Measurement Date" means the last day of a Fiscal Quarter.
"Register" has the meaning set forth in Section 12.06(e).
"Regulated Activity" means any generation, treatment, storage, recycling,
transportation or disposal of any Hazardous Substance.
28
"Regulation U" means Regulation U of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Reinvestable Proceeds" has the meaning set forth in Section 2.06(a).
"Related Fund" means, with respect to any Lender that is a fund that
invests in commercial loans, any other fund that invests in commercial loans and
is managed by the same investment advisor as such Lender or by an affiliate of
such investment advisor.
"Required Lenders" means at any time Lenders holding in excess of 50% in
aggregate principal amount of the Loans then outstanding.
"Restricted Investment" means any Investment or Acquisition other than an
Investment or Acquisition made pursuant to Section 7.08(a).
"Restricted Payment" means (i) any dividend or other distribution on any
Equity Interests of the Issuer or any Restricted Subsidiary (except dividends
payable solely in Equity Interests of the same class) and (ii) any payment on
account of the purchase, redemption, retirement or acquisition of any Equity
Interests of the Issuer or any Restricted Subsidiary.
"Restricted Subsidiary" means any Subsidiary of the Issuer other than an
Unrestricted Subsidiary; the initial Restricted Subsidiaries as of the Closing
Date are identified on Schedule 1 hereto.
"S&P" means Standard and Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Sale and Leaseback Transaction" means, with respect to any Person, an
arrangement whereby such Person enters into a lease of property previously
transferred by such Person to the lessor.
"Satisfactory Plan of Reorganization" means the Plan of Reorganization as
approved in connection with the Disclosure Statement Hearing, without giving
effect to any subsequent amendments thereof.
"SEC" means the United States Securities and Exchange Commission.
"Secured Obligations" has the meaning set forth in Section 1 of the
Security Agreement.
29
"Securities Act" means the Securities Act of 1933, as amended from time to
time.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Security Agreement" means a Second Priority Security Agreement among the
Issuer, Vencor, the Restricted Subsidiaries and the Collateral Agent,
substantially in the form of Exhibit B hereto, as amended from time to time.
"Security Agreement Supplement" means a Second Priority Security Agreement
Supplement, substantially in the form of Exhibit A to the Security Agreement,
whereby the Issuer or a Guarantor grants (or confirms its grant of) a security
interest in additional Collateral to the Collateral Agent and, if the grantor of
such security interest is a Subsidiary that is not already a party to the
Security Agreement, such Subsidiary becomes a party thereto.
"Security Interests" has the meaning set forth in Section 1 of the Security
Agreement.
"Senior Agents" means, collectively, the "Agents" as such term is defined
in the Exit Facility.
"Senior Lenders" means the "Lenders", the "Swingline Bank", the "LC Issuing
Banks" and the "Interest Hedge Counterparties" as such terms are defined in the
Exit Facility.
"Senior Obligations" means all obligations (whether in existence on the
Closing Date or arising afterwards, absolute or contingent, direct or indirect)
of the Issuer and each Guarantor for or in respect of principal (when due, upon
acceleration, upon redemption, upon mandatory repayment or repurchase pursuant
to a mandatory offer to purchase, or otherwise), premium, interest, penalties,
fees, indemnification, reimbursement and other amounts payable and liabilities
under the Exit Facility, the other Exit Facility Financing Documents and the
"Designated Interest Rate Agreements" (as defined in the Exit Facility),
including all interest accrued or accruing after the commencement of any
bankruptcy, insolvency or reorganization or similar case or proceeding at the
contract rate (including, without limitation, any contract rate applicable upon
default) specified in the relevant documentation, whether or not the claim for
such interest is allowed as a claim in such case or proceeding.
"Shell Subsidiary" means Stamford Health Associates, L.P., a Connecticut
limited partnership.
30
"Stated Maturity Date" means the seventh anniversary of the Closing Date or,
if such day is not a Euro-Dollar Business Day, the next preceding Euro-Dollar
Business Day.
"Subordinated Debt" means any Debt of the Issuer or any Guarantor which is
subordinated in right of payment to the Notes, the Subsidiary Guaranty or the
Vencor Guaranty, as applicable, pursuant to a written agreement to that effect.
"Subsidiary" means, as to any Person, (i) any corporation or other entity
of which securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly owned by such Person or (ii)
any limited liability company or partnership that, in accordance with GAAP, is a
Consolidated Subsidiary of such Person. Unless otherwise specified, "Subsidiary"
means a Subsidiary of the Issuer.
"Subsidiary Guarantor" means a current or future Restricted Subsidiary that
(i) guarantees the obligations of the Issuer under the Financing Documents
pursuant to the Subsidiary Guaranty Agreement and (ii) grants a security
interest in its assets to the Collateral Agent under the Security Agreement to
secure its Subsidiary Guaranty.
"Subsidiary Guaranty" means a guaranty by a Subsidiary Guarantor that the
Issuer will perform its obligations under the Financing Documents, such guaranty
to be set forth in the Subsidiary Guaranty Agreement.
"Subsidiary Guaranty Agreement" means an instrument, substantially in the
form of Exhibit C hereto, setting forth the Subsidiary Guaranties of one or more
Subsidiary Guarantors.
"Tax Allocation Agreement" means the Tax Allocation Agreement between Vencor
and Ventas entered into in connection with the reorganization of such entities
in 1998, as amended pursuant to the terms of the Tax Refund Escrow Agreement.
"Tax Refund Escrow Agreement" means the Tax Refund Escrow Agreement among
certain Vencor Companies and certain Ventas Companies substantially in the form
of Exhibit 5 to the Plan Supplement that provides for the escrow and use of
certain tax refunds.
"Temporary Cash Investment" means any investment in (i) securities issued,
or directly and fully guaranteed or insured, by the United States or any agency
or instrumentality thereof; provided that the full faith and credit of the
United States is pledged in support thereof, (ii) time deposit accounts,
bankers' acceptances, certificates of deposit and money market deposits maturing
within 180 days of the
31
date of acquisition thereof issued by any office located in the United States of
a bank or trust company which is organized or licensed under the laws of the
United States or any State thereof and which bank or trust company has capital,
surplus and undivided profits aggregating more than $1,000,000,000 and has
outstanding debt which is rated "P-l" (or higher) by Moody's or "A-l" (or
higher) by S&P or any money-market fund sponsored by a registered broker dealer
or mutual fund distributor, (iii) repurchase obligations with a term of not more
than 30 days for underlying securities of the types described in clause (i)
above entered into with an office located in the United States of a bank or
trust company meeting the qualifications described in clause (ii) above, (iv)
commercial paper, maturing not more than 180 days after the date of acquisition,
issued by a corporation (other than any Ventas Company, any Vencor Company or
any Affiliate) organized under the laws of the United States or any State
thereof with a rating, at the date of acquisition, of "P-l" (or higher) by
Moody's or "A-l" (or higher) by S&P, (v) securities with maturities of 6 months
or less from the date of acquisition issued or fully and unconditionally
guaranteed by any State, commonwealth or territory of the United States, or by a
political subdivision or taxing authority thereof, and rated at least "P-l" (or
higher) by Moody's or "A-l" (or higher) by S&P and (vi) money market funds which
invest substantially all of their assets in securities described in the
preceding clauses (i) through (v).
"Third Party Leases" means the leases by the Issuer or a Guarantor listed
and identified as "Third Party Leases" in Schedule 4 hereto.
"UCC" has the meaning set forth in Section 1 of the Security Agreement.
"Unfunded Liabilities" means, with respect to any Plan at any time, the
amount (if any) by which (i) the value of all benefit liabilities under such
Plan, determined on a plan termination basis using the assumptions prescribed by
the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the fair market
value of all Plan assets allocable to such liabilities under Title I of ERISA
(excluding any accrued but unpaid contributions), all determined as of the then
most recent valuation date for such Plan, but only to the extent that such
excess represents a potential liability of a member of the ERISA Group to the
PBGC or any other Person under Title IV of ERISA.
"United States" means the United States of America, including the States
and the District of Columbia, but excluding its territories and possessions.
"Unrestricted Subsidiary" means any Subsidiary of the Issuer that at the
time of determination has previously been designated, and continues to be, an
Unrestricted Subsidiary in accordance with Section 5.07.
"Vencor" has the meaning set forth in the introduction to this Agreement.
32
"Vencor Company" means Vencor or any Subsidiary of Vencor.
"Vencor Guaranty" means the guaranty by Vencor that the Issuer will perform
its obligations under the Financing Documents, such guaranty to be set forth in
the Vencor Guaranty Agreement.
"Vencor Guaranty Agreement" means an instrument, substantially in the form
of Exhibit D hereto, setting forth the Vencor Guaranty.
"Vencor Unrestricted Subsidiary" means any Subsidiary of Vencor other than
the Issuer and any of the Issuer's Subsidiaries.
"Ventas" means Ventas, Inc., a Delaware corporation.
"Ventas Company" means Ventas or any Subsidiary of Ventas.
"Wholly Owned" means, with respect to any Restricted Subsidiary, a
Restricted Subsidiary all of the outstanding capital stock of which (other than
any director's qualifying shares) is owned by the Issuer and one or more Wholly
Owned Restricted Subsidiaries (or a combination thereof).
Section 1.02. Accounting Terms and Determinations. Unless otherwise
specified herein, all accounting terms used herein shall be interpreted, all
accounting determinations hereunder shall be made, and all financial statements
required to be delivered hereunder shall be prepared in accordance with GAAP;
provided that, if the Issuer notifies the Administrative Agent that the Issuer
wishes to amend any provision hereof to eliminate the effect of any change in
GAAP on the operation of such provision (or if the Administrative Agent notifies
the Issuer that the Required Lenders wish to amend any provision hereof for such
purpose), then such provision shall be applied on the basis of GAAP in effect
immediately before the relevant change in GAAP became effective, until either
such notice is withdrawn or such provision is amended in a manner satisfactory
to the Issuer and the Required Lenders.
Section 1.03. Definitions from Disclosure Statement. Capitalized terms used
herein that are not defined herein but are defined in the Disclosure Statement
(including the Plan of Reorganization) have the meanings given in the Disclosure
Statement.
Section 1.04. Other Definitional Provisions. References in this Agreement
to "Articles", "Sections", "Schedules" or "Exhibits" are to Articles, Sections,
Schedules or Exhibits of or to this Agreement unless otherwise specifically
provided. Any of the terms defined in Section 1.01 may, unless the context
otherwise requires, be used in the singular or plural depending on the
reference. "Include", "includes"
33
and "including" are deemed to be followed by "without limitation" whether or not
they are in fact followed by such words or words of like import. "Writing",
"written" and comparable terms refer to printing, typing, facsimile and other
means of reproducing words on paper. References to any agreement or contract are
to such agreement or contract as amended, modified or supplemented from time to
time (whether before, on or after the Closing Date) in accordance with the terms
hereof and thereof. "Hereto", "herein" and "hereof' refer to this Agreement as
amended from time to time.
ARTICLE 2
The Notes
Section 2.01. Issuance of Notes. As contemplated by the Plan of
Reorganization, on the Effective Date and subject to the occurrence of the
Closing, the Issuer will issue $300,000,000 aggregate principal amount of the
Notes, and each Lender will receive a single Note payable for the account of its
Lending Office in a principal amount equal to the amount set forth opposite its
name on the Initial Lender Schedule; provided that any Note issued to the
Custodian on the Effective Date shall be held by the Custodian on behalf of
holders of Senior Debt Claims in accordance with and subject to the terms of the
Plan of Reorganization until such holders become Lenders pursuant to Section
12.06. Upon receipt of each Lender's Note pursuant to Section 3.01(b), the
Administrative Agent shall forward such Note to such Lender. Each Lender shall
record the date and amount of each payment of principal made by the Issuer with
respect thereto, and may, in connection with any transfer or enforcement of its
Note, endorse on the schedule forming a part thereof appropriate notations to
evidence the foregoing information with respect to the then outstanding
principal amount of the Loans evidenced by such Note; provided that neither the
failure of any Lender to make any such recordation or endorsement nor any error
therein shall affect the obligations of the Issuer or the Guarantors under any
Financing Document. Each Lender is hereby irrevocably authorized by the Issuer
and the Guarantors so to endorse its Note and to attach to and make a part of
such Note a continuation of any such schedule as and when required. Each Note
shall evidence indebtedness of the Issuer owed to the relevant Lender on the
terms and conditions set forth herein and therein.
Section 2.02. Interest Rate; Default Rate.
(a) Each Loan shall bear interest on the outstanding principal amount
thereof, for each day during each Interest Period applicable thereto, at a rate
per annum equal to the sum of the Euro-Dollar Margin plus the London Interbank
Offered Rate applicable to such Interest Period; provided that no such interest
shall
34
accrue on the Notes until, and the initial Interest Period applicable thereto
shall commence on, the Interest Commencement Date. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than three months, three months after the first day thereof.
The "London Interbank Offered Rate" applicable to any Interest Period means
the rate per annum (rounded upwards, if necessary, to the nearest l/l00 of 1%)
appearing on Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in dollars at approximately 11:00 A.M. (London time)
two Euro-Dollar Business Days before the first day of such Interest Period for a
term comparable to such Interest Period; provided that, if more than one rate is
specified on such Telerate Page, the applicable rate shall be the arithmetic
mean of all such rates. If for any reason no such rate is available on such
Telerate Page, the applicable London Interbank Offered Rate shall be determined
in accordance with the preceding sentence on the basis of the comparable rate or
rates appearing on Reuters Screen LIBO Page.
(b) (i) Upon the occurrence of an Event of Default of the type referred to
in Section 8.01(a), 8.01(b) or 8.01(n) or (ii) after the continuance for seven
consecutive days of any other Event of Default, then for so long as such Event
of Default shall be continuing and not waived, each Loan shall bear interest on
the outstanding principal amount thereof, payable on demand, for each day until
such Event of Default has been cured, at a rate per annum equal to the sum of
2.5% plus the Euro-Dollar Margin plus (A) for the remainder of the Interest
Period in which the Event of Default occurred, the higher of the London
Interbank Offered Rate applicable to such Interest Period and the London
Interbank Offered Rate that would be applicable for an Interest Period of one
month beginning on such day and (B) thereafter, the London Interbank Offered
Rate that would be applicable for an Interest Period of one month.
Section 2.03. Method of Electing Interest Periods. (a) The Issuer shall
elect the initial Interest Period to be applicable to all the Loans commencing
on the Interest Commencement Date and thereafter shall elect additional Interest
Periods effective on the last day of the then current Interest Period; provided
that if the Interest Commencement Date is the date described in clause (b) of
the definition thereof, the Issuer shall be deemed to have delivered a Notice of
Interest Rate Election electing an initial Interest Period of one month for the
Interest Period commencing on the Interest Commencement Date. Each such election
shall be made by delivering a notice (a) "Notice of Interest Rate Election") to
the Administrative Agent not later than Noon (Eastern Time) on the third Euro-
Dollar Business Day before the election selected in such notice is to be
effective.
(b) Each Notice of Interest Rate Election shall specify:
35
(i) the date upon which such election is to be effective; and
(ii) the duration of such initial or additional Interest Period.
Each Interest Period specified in a Notice of Interest Rate Election shall
comply with the provisions of the definition of Interest Period.
(c) Upon receipt of a Notice of Interest Rate Election from the Issuer
pursuant to Section 2.03(a), the Administrative Agent shall promptly notify each
Lender of the contents thereof and such notice shall not thereafter be revocable
by the Issuer. If the Issuer fails to deliver a timely Notice of Interest Rate
Election to the Administrative Agent or if any Notice of Interest Rate Election
does not specify an Interest Period, then the Issuer shall be deemed to have
selected an Interest Period of one month.
Section 2.04. Administrative Agent and Collateral Agent Fee. The Issuer
shall pay to the Administrative Agent a monthly fee as set forth in the fee
letter dated February 28, 200l among the Issuer, Vencor, the Administrative
Agent and X.X. Xxxxxx Securities Inc., payable in advance on the Closing Date
(for the remainder of the month in which such date falls) and on the last
Business Day of each month thereafter (for the next succeeding month).
Section 2.05. Final Maturity of Notes. The outstanding principal amount of
the Loans shall be due and payable (together with interest accrued thereon) on
the Stated Maturity Date.
Section 2.06. Mandatory Prepayments of Notes.
(a) Asset Sales; Casualty Proceeds. If on or after the Closing Date the
Issuer or any Restricted Subsidiary receives any Net Cash Proceeds of any Asset
Sale (other than the Kingfish Transaction) or any Casualty Proceeds
(collectively, "Reinvestable Proceeds"), the Issuer shall (i) promptly provide
notice thereof to the Administrative Agent, which notice shall specify the
amount of Reinvestable Proceeds received and the date on, and the asset or event
in respect of, which such Reinvestable Proceeds were received and (ii) within
two Business Days of the receipt thereof deposit or cause to be deposited such
Revinvestable Proceeds in a Collateral Account, where they shall be held until
such Reinvestable Proceeds are applied as provided herein, provided that if and
to the extent that such Reinvestable Proceeds are required to be deposited with
the Exit Facility Collateral Agent, the Issuer shall not be required to deposit
such Reinvestable Proceeds with the Collateral Agent but they shall remain
otherwise subject to this Section 2.06(a). Reinvestable Proceeds (and any income
from investment thereof) shall be subject to the following provisions.
36
(A) During the one-year period beginning with the date on which the
Issuer received such Reinvestable Proceeds, such Reinvestable Proceeds will
be released by the Collateral Agent (or may be released by the Exit
Facility Collateral Agent) from time to time, at the Issuer's request, (1)
to repay principal of the PIP Claim and any interest accrued with respect
thereto through the date of repayment, (2) if such Reinvestable Proceeds
have been or concurrently are being made the basis of a permanent reduction
in the amount of the commitments under the Exit Facility, (3) to restore,
repair, replace or rebuild the asset in respect of which Casualty Proceeds
were received (or to reimburse the Issuer or any Restricted Subsidiary for
any such amounts paid by it), (4) to fund the Issuer's or a Restricted
Subsidiary's payment of the purchase price of an Acquisition of a
Healthcare Facility or real property, equipment or other assets used or to
be used in, or in connection with, the operation of a Healthcare Facility
owned or operated, or proposed to be developed for operation, by the Issuer
or a Restricted Subsidiary (including any Healthcare Facility already owned
by the Issuer or a Restricted Subsidiary) or (5) subject to Section 11.03,
to prepay Loans, provided that the Issuer may not request the release of
any Reinvestable Proceeds if an Event of Default shall have occurred and be
continuing.
(B) If on the first anniversary of the date any Reinvestable Proceeds
were deposited in a Collateral Account (or deposited in a collateral
account pursuant to the Exit Facility) any portion of such Reinvestable
Proceeds have not been released for application pursuant to subclause (A),
subject to Section 11.03, such remaining amount shall (subject to
subsection (d) below) be applied within two Business Days thereafter to
prepay Loans; provided that the amount required to be so prepaid may be
reduced by amounts that the Issuer certifies are concurrently being made
the basis for a permanent reduction in the amount of commitments under the
Exit Facility. In determining how long any particular Reinvestable Proceeds
have been held in a Collateral Account, deposits and releases shall be
accounted for on a first-in, first-out basis.
(C) Any Reinvestable Proceeds held by the Collateral Agent or the
Exit Facility Collateral Agent may also be released from time to time, at
the Issuer's request (such request to certify that no Default then exists),
for concurrent application to repay loans then outstanding under the Exit
Facility (each such release, a "Temporary Withdrawal"); provided that (1)
immediately after giving effect to such repayment, the amount available to
be drawn under the Exit Facility (taking into account the borrowing base
then in effect) is at least equal to the aggregate amount of such Temporary
Withdrawal and any other Temporary Withdrawals then outstanding and (2) at
the end of the one-year period applicable to such Reinvestable Proceeds
(or, if earlier, any date upon which an Event of Default occurs), the
Issuer shall be
37
unconditionally obligated to re-deposit with the Collateral Agent or the
Exit Facility Agent, as the case may be (for immediate application as
provided in subclause (B)), an amount equal to (i) the amount of such
Temporary Withdrawal less (ii) any amounts deemed applied against such re-
deposit obligation pursuant to the following provisions of this subclause
(C). During such one-year period, the Issuer may by notice to the
Collateral Agent and the Exit Facility Agent (which notice shall certify
that no Default then exists) identify any purpose for which it would
otherwise have been entitled to request a release of such Reinvestable
Proceeds and designate the amount that it would otherwise have been able to
withdraw to be deemed applied against such re-deposit obligation. During
such one-year period, the Issuer will not make any borrowing of loans or
swingline loans, or request the issuance of any letter of credit, under the
Exit Facility, unless, after giving effect thereto, the amount available to
be drawn under the Exit Facility (taking into account the borrowing base
then in effect) would be at least equal to the aggregate amount, determined
as of such day, of all re-deposit obligations that the Issuer has with
respect to Reinvestable Proceeds withdrawn pursuant to this subclause (C).
(b) Equity Issuances. If on any date (an "Equity Receipt Date") on or
after the Closing Date Vencor receives any Net Cash Proceeds from any Equity
Issuance, Vencor shall promptly provide notice thereof to the Administrative
Agent, which notice shall specify the amount of the Net Cash Proceeds received
with respect thereto, the amount equal to 75% of such Net Cash Proceeds (the
"Designated Equity Proceeds") and the date on which such Designated Equity
Proceeds were received. Such Designated Equity Proceeds shall be applied as
follows:
(i) Vencor may during the six-month period following any Equity
Receipt Date deliver to the Administrative Agent one or more definitive
executed agreements for an Acquisition by Vencor or any of its Subsidiaries
of one or more Healthcare Facilities, together in each instance with a
certificate describing in reasonable detail the purchase price of such
Acquisition (a "Proposed Purchase Price") and identifying the related pool
of Designated Equity Proceeds proposed to be used to fund such Proposed
Purchase Price.
(ii) Within three Business Days after the end of such six-month
period, an amount equal to the lesser of (A) 66 2/3% of the original amount
of such Designated Equity Proceeds and (B) the original amount of such
Designated Equity Proceeds less the aggregate Proposed Purchase Prices
certified with respect thereto pursuant to clause (i) less any amount of
such Designated Equity Proceeds that have been or concurrently are being
(1) used to repay principal of the PIP Claim and any interest accrued with
respect thereto through the date of repayment or (2) made the basis for a
permanent reduction in the amount of the commitments under the Exit
Facility, shall be
38
transferred from Vencor to the Issuer as an equity contribution and, subject
to Section 11.03, the Issuer shall (subject to subsection (d) below) prepay
an aggregate principal amount of Loans equal to such amount.
(iii) No later than the first anniversary of such Equity Receipt Date
Vencor shall deliver a certificate to the Administrative Agent specifying
the actual amounts paid during such one-year period as the purchase price
of any such Acquisition certified with respect thereto pursuant to clause
(i) (an "Actual Purchase Price"), and within three Business Days thereafter
an amount equal to (A) 66 2/3% of the original amount of such Designated
Equity Proceeds less (B) the sum of (1) the aggregate Actual Purchase
Prices, (2) without double counting, any amount of such Designated Equity
Proceeds that have been or concurrently are being (x) used to repay
principal of the PIP Claim and any interest accrued with respect thereto
through the date of repayment or (y) made the basis for a permanent
reduction in the amount of the commitments under the Exit Facility and (3)
any amount applied to repayment of the Loans pursuant to clause (ii), shall
be transferred from Vencor to the Issuer as an equity contribution and,
subject to Section 11.03, the Issuer shall (subject to subsection (d)
below) prepay an aggregate principal amount of Loans equal to such amount.
(iv) In addition, Vencor may during the one-year period following
such Equity Receipt Date deliver to the Administrative Agent one or more
definitive executed agreements, in addition to any agreements delivered
pursuant to clause (i), for an Acquisition by Vencor or any of its
Subsidiaries of one or more Healthcare Facilities, together in each
instance with a certificate describing in reasonable detail the Proposed
Purchase Price and identifying the related pool of Designated Equity
Proceeds proposed to be used to fund such Proposed Purchase Price.
(v) Within three Business Days after the end of such one-year
period, an amount equal to (A) the original amount of such Designated
Equity Proceeds less (B) the sum of (1) the aggregate Proposed Purchase
Prices certified with respect thereto pursuant to clause (i) (to the extent
the Actual Purchase Price has not been determined with respect thereto) or
clause (iv), (2) the aggregate related Actual Purchase Prices determined
pursuant to clause (iii), (3) without double counting, any amount of such
Designated Equity Proceeds that have been or concurrently are being (x)
used to repay principal of the PIP Claim and any interest accrued with
respect thereto through the date of repayment or (y) made the basis for a
permanent reduction in the amount of the commitments under the Exit
Facility and (4) any amount applied to repayment of the Loans pursuant to
clause (ii) or (iii), shall be transferred from Vencor to the Issuer as an
equity contribution and, subject to Section 11.03,
39
the Issuer shall (subject to subsection (d) below) prepay an aggregate
principal amount of Loans equal to such amount.
(vi) No later than the date eighteen months after such Equity Receipt
Date Vencor shall deliver a certificate to the Administrative Agent
specifying the Actual Purchase Price paid during such eighteen-month period
of any Acquisition described pursuant to clause (iv), and within three
Business Days thereafter an amount equal to (A) the original amount of such
Designated Equity Proceeds less (B) the sum of (1) the aggregate related
Actual Purchase Prices determined pursuant to this clause (vi) and clause
(iii), (2) without double counting, any amount of such Designated Equity
Proceeds that have been or concurrently are being (x) used to repay
principal of the PIP Claim and any interest accrued with respect thereto
through the date of repayment or (y) made the basis for a permanent
reduction in the amount of the commitments under the Exit Facility and (3)
any amount applied to repayment of the Loans pursuant to clause (ii), (iii)
or (v), shall be transferred from Vencor to the Issuer as an equity
contribution and, subject to Section 11.03, the Issuer shall (subject to
subsection (d) below) prepay an aggregate principal amount of Loans equal
to such amount.
(c) Tax Refunds. If on or after the Closing Date Vencor receives a cash
payment out of the original amount deposited and held in escrow under the Tax
Refund Escrow Agreement, Vencor shall promptly provide notice thereof to the
Administrative Agent, which notice shall specify the amount of the payment
received and the date (the "Tax Receipt Date") on which such payment was
received and the intended application thereof. Such cash payments shall be
applied as follows:
(i) During the two Business Day period after the Tax Receipt Date,
Vencor may apply such payment (or a portion thereof) to pay a tax liability
of the nature intended to be paid from funds held in escrow under the Tax
Refund Escrow Account.
(ii) If on the third Business Day after the Tax Receipt Date, any
portion of such payment shall not have been applied pursuant to clause (i),
such remaining amount shall be transferred from Vencor to the Issuer as an
equity contribution and, subject to Section 11.03, shall be applied by the
Issuer (subject to clause (d) below) to prepay an aggregate principal
amount of Loans equal to such remaining amount; provided that the amount
required to be so prepaid may be reduced by amounts that are concurrently
being made the basis for a permanent reduction in the amount of commitments
under the Exit Facility or will be used promptly to repay principal of the
PIP Claim and any interest accrued with respect thereto through the day of
repayment.
40
(d) Timing of Prepayment. Notwithstanding the foregoing, if the aggregate
principal amount of the Loans required to be prepaid on any date pursuant to
this Section 2.06 is less than $l,000,000, such prepayment shall be deferred
without penalty until the aggregate principal amount of the Loans required to be
prepaid pursuant to this Section 2.06 (including such deferred amounts) is not
less than $1,000,000.
(e) Notice of Prepayments. The Issuer shall give the Administrative Agent
notice of any prepayment being made pursuant to this Section 2.06 no later than
Noon (Eastern Time) on the date of prepayment, specifying the date and amount of
such prepayment and describing in reasonable detail the event or events which
require such prepayment and calculation of the amount thereof. Promptly upon
receipt of any such notice, the Administrative Agent shall notify each Lender of
the contents thereof and such Lender's share of such prepayment.
(f) Interest. Each prepayment of principal of the Loans under this Section
2.06 shall be made together with interest accrued on the amount prepaid to the
date of payment.
Section 2.07. Optional Prepayments.
(a) Notice to Administrative Agent. The Issuer may, upon giving a
prepayment notice to the Administrative Agent at least three Euro-Dollar
Business Days before the date of prepayment, prepay the Loans on the Business
Day specified therein in whole or in part in the amount specified therein (which
if in part must be $l,000,000 or any larger multiple of $100,000).
(b) Notice to Lenders. Upon receiving a notice pursuant to this Section
2.07, the Administrative Agent shall promptly notify each Lender of the contents
thereof and of such Lender's share of such prepayment and such notice shall not
thereafter be revocable by the Issuer.
(c) Payment of Accrued Interest. Each prepayment of principal of the Loans
under this Section 2.07 shall be made together with interest accrued on the
amount prepaid to the date of payment.
Section 2.08. General Provision as to Payments.
(a) The Issuer shall make each payment of principal of, and interest on,
the Loans and each payment of fees hereunder not later than 1:00 P.M. (Eastern
Time) on the date when due, in Federal or other funds immediately available in
New York, New York, to the Administrative Agent at its address for payments
specified in or pursuant to Section 12.01. Upon receiving a payment for the
account of the Lenders, the Administrative Agent will promptly distribute to
each such Lender its ratable share of
41
such payment. Whenever any payment of principal of, or interest on, the Loans
shall be due on a day which is not a Euro-Dollar Business Day, the date for
payment thereof shall be extended to the next succeeding Euro-Dollar Business
Day unless such Euro-Dollar Business Day falls in another calendar month, in
which case the date for payment thereof shall be the next preceding Euro-Dollar
Business Day. If the date for any payment of principal is extended by operation
of law or otherwise, interest thereon shall be payable for such extended time.
(b) Unless the Administrative Agent shall have received notice from the
Issuer before the date on which any payment is due to any of the Lenders
hereunder that the Issuer will not make such payment in full, the Administrative
Agent may assume that the Issuer has made such payment in full to the
Administrative Agent on such date and, in reliance upon such assumption, the
Administrative Agent may (but shall not be obligated to) cause to be distributed
to each Lender on such due date an amount equal to the amount then due such
Lender. If and to the extent that the Issuer shall not have so made such
payment, each such Lender shall repay to the Administrative Agent forthwith on
demand any such amount distributed to such Lender together with interest
thereon, for each day from the date such amount is distributed to such Lender
until the date such Lender repays such amount to the Administrative Agent, at
the Federal Funds Rate.
(c) If the Issuer makes any payment of principal with respect to any Loan
on any day other than the last day of an Interest Period applicable thereto, or
the last day of an applicable period fixed pursuant to Section 2.02(b), or if
the Issuer fails to prepay any Loan after notice has been given to any Lender in
accordance with the provisions of Section 2.06(e) or 2.07(b), the Issuer shall
reimburse each Lender for any resulting loss or expense incurred by it,
including any loss incurred in obtaining, liquidating or employing deposits from
third parties, subject to and in accordance with the following procedure. Each
Lender wishing to demand compensation pursuant to this Section 2.08(c) shall,
within seven Business Days after the relevant payment or failure to prepay,
notify the Administrative Agent that it demands such compensation and deliver to
the Administrative Agent a certificate as to the amount of compensation which
such Lender is entitled to receive pursuant to the first sentence of this
Section, showing the calculation thereof in reasonable detail. Such certificate
shall be conclusive in the absence of manifest error. Promptly after the end of
such period of seven Business Days, the Administrative Agent shall notify the
Issuer of all demands for such compensation received by it during such period
and deliver to the Issuer copies of the supporting certificates received by it
from Lenders. Within 15 days thereafter, the Issuer shall pay to the
Administrative Agent the aggregate amount properly demanded by Lenders pursuant
to this Section and upon receipt thereof, the Administrative Agent shall
distribute such amount to the Lenders entitled thereto.
Section 2.09. Computation of Interest and Fees.
42
(a) Interest hereunder shall be computed on the basis of a year of 360
days and paid for the actual number of days elapsed (including the first day but
excluding the last day).
(b) The Administrative Agent shall determine each interest rate applicable
hereunder. The Administrative Agent shall give prompt notice to the Issuer and
the Lenders of each interest rate so determined, and its determination thereof
shall be conclusive in the absence of manifest error.
Section 2.10. Release of Security Interest in Assets Being Sold. The
Administrative Agent shall from time to time instruct the Collateral Agent to
release specific assets (but not all or substantially all the Collateral) from
the Security Interests pursuant to Section 18 of the Security Agreement if:
(i) the Administrative Agent shall have received a written request
for such release signed by any Executive Officer or a Financial Officer
stating that (x) the assets to be released are being sold or otherwise
transferred and (y) the sale or transfer thereof does not violate Section
7.03(d) hereof;
(ii) arrangements satisfactory to the Administrative Agent have been
made so that such release will become effective no earlier than the closing
of such sale or transfer;
(iii) in the case of an Asset Sale, arrangements satisfactory to the
Administrative Agent have been made to deposit an amount equal to the Net
Cash Proceeds payable at the closing of such Asset Sale, if any, in a
Collateral Account and apply it in accordance with Section 2.06(a); and
(iv) no Default or Enforcement Notice is in effect when such
instructions are given.
Section 2.11. Forgiveness of Principal. (a) In the event that the principal
amount of the Loans are being repaid in full on a date prior to the Interest
Commencement Date then in effect (other than after an Event of Default described
in Section 8.01(n) involving the Issuer or Vencor has occurred), whether at the
option of the Issuer, mandatorily or upon acceleration, a portion of such
outstanding principal amount equal to the applicable Forgiveness Amount shall
not be repaid in cash by the Issuer and instead, effective automatically with
the repayment of the remaining portion of the outstanding principal amount of
the Loans, such principal amount of the Loans shall be forgiven by the Lenders.
(b) In the event that the principal amount of the Loans are being repaid
in part on a date prior to the Interest Commencement Date then in effect (other
than after an Event of Default described in Section 8.01(n) involving the Issuer
or Vencor has
43
occurred), whether at the option of the Issuer, mandatorily or upon
acceleration, a portion of the remaining principal amount of the Loans equal to
the applicable Forgiveness Amount, if any, shall, effective automatically with
the making of the related Proposed Prepayment (as defined under "Forgiveness
Amount"), be forgiven by the Lenders.
ARTICLE 3
Conditions
Section 3.01. Effectiveness of this Agreement; Closing. This Agreement will
become effective, and the Closing will occur, when (i) the Administrative Agent
shall have received the following documents, each dated the Closing Date unless
otherwise indicated, and (ii) the other conditions specified below shall have
been satisfied:
(a) with respect to each party listed on the signature pages hereof,
either a counterpart of this Agreement signed by such party or facsimile or
other written confirmation satisfactory to the Administrative Agent that such
party has signed a counterpart hereof;
(b) a duly executed Note complying with the provisions of Section 2.01
payable to each Lender;
(c) a counterpart of the Subsidiary Guaranty Agreement signed by each
Restricted Subsidiary;
(d) a counterpart of the Vencor Guaranty Agreement signed by Vencor;
(e) a counterpart of the Security Agreement, signed by Vencor, the Issuer
and each Restricted Subsidiary, together with (to the extent not already held by
Xxxxxx in its capacity as collateral agent under the Pre-Petition Senior Credit
Agreement and DIP Facility) certificates evidencing all the certificated Equity
Interests listed in Schedule 1 hereto (other than Equity Interests held in
Vencor, Cornerstone or any Excluded Partnership) and signed stock powers or
other appropriate instruments of transfer relating thereto;
(f) a counterpart of the Intercreditor Agreement signed by each of the
parties thereto;
(g) a signed counterpart of a Fee Mortgage with respect to each Owned
Property in proper form for recording in the relevant jurisdictions, together
with evidence reasonably satisfactory to the Collateral Agent that such Fee
Mortgages will be recorded on or promptly after the Closing Date, and any
related intangibles,
44
mortgage recording (if any) or similar taxes will be paid in connection with
such recording;
(h) a signed counterpart of a Leasehold Mortgage with respect to the lease
of each of the Initial Master Lease Properties and each of the Other Leased
Properties, together with evidence satisfactory to the Collateral Agent that
such Leasehold Mortgages will be recorded on or promptly after the Closing Date
or as otherwise agreed by the Collateral Agent pursuant to the Escrow Agreement,
and any related intangibles, mortgage recording (if any) or similar taxes will
be paid in connection with such recording;
(i) receipt by the Collateral Agent of lender's title insurance policies
in an aggregate amount equal to $120 million with respect to the Mortgages, such
policies to be in form and substance reasonably satisfactory to the Collateral
Agent;
(j) all signed UCC financing statements reasonably requested by the
Collateral Agent to perfect its security interests in the Collateral and
evidence satisfactory to the Collateral Agent that such UCC financing statements
will be filed on or promptly after the Closing Date or as otherwise agreed by
the Collateral Agent pursuant to the Escrow Agreement, and any related filing
fees or similar charges or taxes will be paid in connection with such filing;
(k) a counterpart of each Master Lease Agreement signed by each of the
parties thereto, together with evidence satisfactory to the Collateral Agent
that appropriate memoranda of lease will be recorded on or promptly after the
Closing Date with respect to each of the Initial Master Lease Properties, as
required to protect the rights of the Issuer as lessee thereof against third
parties; the Master Lease Agreements as so executed shall be consistent in all
material respects with the form thereof marked as an exhibit in connection with
the confirmation hearing before the Court on March 1, 200l;
(l) the Confirmation Order, as entered on the Court's docket on March 19,
2001, shall not have been amended or modified in any way that, in the reasonable
judgment of the Required Lenders, materially adversely affects their interests
or rights or the business or financial prospects of the Issuer and its
Restricted Subsidiaries and no appeal of the Confirmation Order shall have been
taken or, if any appeal has been taken, no stay of the Confirmation Order
pending appeal shall be in effect; the Confirmation Order shall not provide that
the Court's retention of jurisdiction thereunder governs the enforcement of the
Financing Documents or any of the rights or remedies of the Lenders or the
Agents related thereto, other than in any respect consented to by the Required
Lenders;
(m) the Effective Date of the Plan of Reorganization shall have occurred,
and all conditions precedent thereto (including termination of the commitments
under the
45
DIP Facility and payment in full of all amounts owing by Vencor or any of its
Subsidiaries thereunder) shall have been satisfied as set forth in the Plan of
Reorganization (or, with the prior consent of the Required Lenders, waived);
(n) all fees and expenses (including but not limited to reasonable fees and
expenses of counsel) required to be paid to the Administrative Agent on or
before the Closing Date shall have been paid;
(o) opinions of (i)(A) the General Counsel of Vencor and the Issuer,
substantially in the form of Exhibit F-l hereto and (B) the Vice President of
Corporate Legal Affairs of Vencor and the Issuer, substantially in the form of
Exhibit F-2 hereto, (ii) Cleary, Gottlieb, Xxxxx & Xxxxxxxx, special counsel for
Vencor and the Issuer, substantially in the form of Exhibit G hereto, (iii)
Morris, Nichols, Arsht & Xxxxxxx, special Delaware counsel for Vencor and the
Issuer, substantially in the form of Exhibit H hereto and (iv) each local real
estate counsel listed on Schedule 7 hereto, substantially in the form of Exhibit
I hereto;
(p) all necessary governmental and third party consents and approvals
necessary in connection with the effectiveness of the Plan of Reorganization and
the transactions contemplated by the Financing Documents shall have been
obtained (without the imposition of any conditions that would reasonably be
expected to have a Material Adverse Effect) and shall remain in effect, and all
requisite governmental filings necessary in connection therewith have been made
and all applicable waiting periods shall have expired without in either case any
action being taken by any competent authority, except in any case or in all
cases in the aggregate such that the failure to have been obtained or made would
not reasonably be expected to have a Material Adverse Effect;
(q) no event or condition which has had or is reasonably likely to have a
Material Adverse Effect shall have occurred;
(r) there shall exist no action, suit, investigation, litigation or
proceeding pending or threatened in any court or before any arbitrator or
governmental instrumentality that, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect:
(s) copies of personal property Lien and tax and judgment Lien searches
received by the Issuer prior to the Closing Date with respect to personal, real
and mixed properties of the Issuer and the Guarantors, which shall not reveal
the existence of any Liens on such properties other than (i) Permitted Liens or
(ii) Liens as to which the Administrative Agent has received evidence
satisfactory that the obligations secured by such Liens have been fully and
finally discharged on or prior to the Closing Date;
46
(t) all other documents that the Administrative Agent may reasonably
request relating to the existence of the Credit Parties, the corporate or other
authority for and the validity of the Financing Documents, the creation and
perfection of the Liens contemplated by the Collateral Documents and any other
matters relevant thereto, all in form and substance satisfactory to the
Administrative Agent.
Promptly after the Closing occurs, the Administrative Agent shall notify the
Issuer and the Lenders thereof, and such notice shall be conclusive and binding
on all parties hereto.
ARTICLE 4
Representations and Warranties
Each of the Issuer and Vencor represents and warrants to the Lender Parties
that:
Section 4.01. Corporate Existence and Power. The Issuer and each Guarantor
(a) is a corporation, limited liability company or partnership duly incorporated
or organized and validly existing under the laws of its jurisdiction of
incorporation or organization, (b) is in good standing under the laws of its
jurisdiction of incorporation or organization and (c) has all corporate or other
powers and all material Governmental Approvals (including without limitation
those required by Medicaid Regulations and Medicare Regulations) required to
carry on its business as now conducted and as proposed to be conducted, except
for such Governmental Approvals the failure of which to have in the aggregate
could not be reasonably expected to have a Material Adverse Effect; provided
that clause (b) shall not apply to either Recovery Inns of America, Inc. or X.X.
Xxxxxx Hospital, Inc. prior to July 31, 2001. The Issuer and each Guarantor is
in compliance with its Organizational Documents.
Section 4.02. Corporate and Governmental Authorization; No Contravention.
The execution and delivery by the Issuer and each Guarantor of the Financing
Documents to which it is a party, its performance of its obligations thereunder
and, with respect to the Issuer, the issuance of the Notes are within its
corporate or other powers, have been duly authorized by all necessary corporate
or other action, require no action by or in respect of, or filing with, any
governmental body, agency or official (other than the Confirmation Order and
except such as shall have been made at or before the time required by the
Financing Documents and shall be in full force and effect on and after the date
when made to the extent required by the Financing Documents) and do not
contravene, or constitute a default under, any Applicable Laws or any provision
of its Organizational Documents, or of any agreement or other instrument binding
upon it or result in or require the imposition of
47
any Lien (other than the Liens created by the Collateral Documents and Liens
securing amounts owing under the Exit Facility) on any of its assets.
Section 4.03. Binding Effect. This Agreement constitutes a valid and
binding agreement of the Issuer and Vencor, and the other Financing Documents,
when executed and delivered as contemplated by this Agreement, will constitute
valid and binding obligations of each Credit Party that is a party thereto, in
each case enforceable in accordance with its terms, except as limited by general
principles of equity and by bankruptcy, insolvency, fraudulent conveyance or
other similar laws affecting creditor's rights generally.
Section 4.04. Security Interests. On the Closing Date, the Collateral
Documents will create valid Security Interests in the Collateral to the extent
set forth therein. At all times after the Closing, the Collateral Documents will
create valid and, when financing statements are filed in the offices specified
in the Perfection Certificates delivered pursuant to the Security Agreement,
perfected Security Interests in the Collateral from time to time covered or
purportedly covered thereby to the extent that a security interest in such
Collateral may be perfected by filing under the UCC. Such Security Interests
will be prior to all other Liens (except Permitted Liens) on such Collateral
until the applicable Security Interest is released pursuant to Section 18 of the
Security Agreement.
Section 4.05. Financial Information.
(a) The consolidated balance sheet of Vencor and its Consolidated
Subsidiaries as of December 31, 2000 and the related consolidated statements of
operations, cash flows and shareholders' equity for the Fiscal Year then ended,
reported on by PricewaterhouseCoopers LLP, fairly present in all material
respects, in conformity with GAAP, the consolidated financial position of Vencor
and its Consolidated Subsidiaries as of such date and their consolidated results
of operations and cash flows for such Fiscal Year.
(b) Since December 31, 2000, no event has occurred and no condition has
come into existence which has had, or is reasonably likely to have, a Material
Adverse Effect.
Section 4.06. Litigation. Except as disclosed in Schedule 8 hereto, there
is no action, suit or proceeding pending against, or to the knowledge of the
Issuer or Vencor threatened against or affecting, the Issuer or any Guarantor
before any court or arbitrator or any governmental body, agency or official (i)
in which there is a reasonable possibility of an adverse decision that could
reasonably be expected to have a Material Adverse Effect or (ii) which in any
manner questions the validity of any Financing Document.
48
Section 4.07. Compliance with ERISA. Each member of the ERISA Group has
fulfilled its obligations under the minimum funding standards of ERISA and the
Internal Revenue Code with respect to each Plan and is in compliance in all
material respects with the presently applicable provisions of ERISA and the
Internal Revenue Code with respect to each Plan. No member of the ERISA Group
has (i) sought a waiver of the minimum funding standard under Section 412 of the
Internal Revenue Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or made any amendment
to any Plan, which has resulted or could result in the imposition of a Lien or
the posting of a bond or other security under ERISA or the Internal Revenue Code
or (iii) incurred any liability under Title IV of ERISA other than a liability
to the PBGC for premiums under Section 4007 of ERISA.
Section 4.08. Taxes. The Issuer and the Guarantors have filed all United
States Federal income tax returns that are required to be filed by them (or have
filed appropriate extensions for filing such tax returns) and have paid all
taxes due pursuant to such returns or pursuant to any assessment received by any
of them, except such taxes, if any, as are being contested in good faith and as
to which reserves have been provided. The charges, accruals and reserves on the
books of the Issuer and the Guarantors in respect of taxes or other similar
governmental charges are in the aggregate, in the opinion of Vencor, adequate.
Section 4.09. Compliance with Laws. The Issuer and the Guarantors are in
compliance in all material respects with all Applicable Laws (including without
limitation Medicaid Regulations and Medicare Regulations), other than such laws,
rules or regulations (i) the validity or applicability of which the Issuer or
the relevant Guarantor is contesting in good faith or (ii) the failure to comply
with which could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Section 4.10. No Regulatory Restrictions on Borrowing. Neither the Issuer
nor any Guarantor is (i) an "investment company", within the meaning of the
Investment Company Act of 1940, as amended, (ii) a "holding company", or an
"affiliate" of a "holding company" or a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended or (iii) otherwise subject to any regulatory scheme which restricts
its ability to incur Debt hereunder.
Section 4.11. Environmental Matters.
(a) From time to time before the Closing, Vencor has reviewed the effect
of Environmental Laws on the business, operations and properties of the Issuer
and the Guarantors, in the course of which reviews it identified and evaluated
associated liabilities and costs. On the basis of such reviews, Vencor has
reasonably concluded
49
that the foregoing associated liabilities and costs are unlikely to have a
Material Adverse Effect.
(b) Except to the extent that the Environmental Liabilities of the Issuer
and the Guarantors that relate to or could result from the matters referred to
in this Section 4.1l(b) would not exceed $l,000,000 for any one occurrence, no
material notice, notification, demand, request for information, citation,
summons, complaint or order with respect to Hazardous Substances or any
violation of Environmental Laws is in existence or, to the knowledge of Vencor,
proposed, threatened or anticipated with respect to or in connection with the
operation of any properties to be owned, leased or operated after the Closing
Date by the Issuer or any Guarantor.
Section 4.12. Full Disclosure. The information (other than projections)
heretofore furnished in writing by the Issuer or any Guarantor to any Agent or
any Lender, taken as a whole, for purposes of or in connection with this
Agreement or any transaction contemplated hereby did not at the time furnished,
and all such information hereafter furnished in writing by the Issuer or any
Guarantor to any Agent or Lender, taken as a whole, will not at the time
furnished, contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in light of the
circumstances under which they were or will be made, not misleading. Although
any projections (and the underlying assumptions) by necessity involve
uncertainties and approximations, Vencor believes that the projections set forth
in its presentation dated January 10, 2001 are reasonable (and the significant
assumptions upon which they are based are stated in summary form therein), and
such projections provide reasonable estimations of the future performance of the
Issuer and its Restricted Subsidiaries, subject, as stated above, to the
uncertainties and approximations inherent in any projections. Vencor has
disclosed to the Lenders in writing (including by way of filings with the Court)
any and all facts which are known to it and which have had or could reasonably
be expected to have a Material Adverse Effect.
Section 4.13. Information as to Equity Interest and Instruments. Schedule 1
hereto sets forth a correct and complete list, as of the close of business on
the Closing Date, of each Subsidiary of Vencor, its outstanding Equity
Interests, the owner thereof and the percentage thereof owned by such owner. As
of the close of business on the Closing Date, neither Vencor nor any of its
Subsidiaries owns any interest in any Subsidiary which is neither the Issuer nor
a Restricted Subsidiary (other than Cornerstone, the Excluded Partnerships and
the Shell Subsidiary). Except as set forth on Schedule 10 hereto, no Debt
(including Permitted Intercompany Debt) owed to any Lien Grantor is evidenced by
an instrument (as such term is defined in the UCC) that is not held in a
Concentration Account or pledged to the Collateral Agent as part of the
Collateral.
50
Section 4.14. Representations in Other Financing Documents. The
representations of each Guarantor in Section 2 of its Guaranty Agreement and the
representations of each Lien Grantor in Section 2 of the Security Agreement and
Section 5 of each Security Agreement Supplement (if any) signed by it are true.
Section 4.15. Margin Stock. (a) The Issuer does not, as of the date hereof,
expect that the Issuer or any Guarantor will acquire any Margin Stock in the
future. Even if they do, Margin Stock will not at any time represent more than
25% of the value (as determined by any reasonable method) of the assets subject
to any provision of the Financing Documents that restricts the right or ability
of the Issuer or any Guarantor to sell, pledge or otherwise dispose of Margin
Stock owned by them or requires a prepayment of Notes upon the exercise of any
such right.
(b) No Notes constitute "buying" or "carrying" any Margin Stock within the
respective meanings of each of the quoted terms under Regulation U or for any
purpose which violates the provisions of any regulation of the Board of
Governors of the Federal Reserve System.
Section 4.16. Properties. (a) The Issuer and each Guarantor has good title
to, or valid leasehold interests in, all real and personal property material to
its business (including all its property subject to the Mortgages), except for
Permitted Liens and minor defects that in the aggregate could not reasonably be
expected to have a Material Adverse Effect.
(b) The Issuer and each Guarantor owns, or is licensed to use, all
trademarks, tradenames, copyrights, patents and other intellectual property
material to its business, and the use thereof by the Issuer and the Guarantors
does not infringe upon the rights of any other Person, except for infringements
that, in the aggregate, could not reasonably be expected to have a Material
Adverse Effect.
(c) As of the Closing Date, neither the Issuer nor any Guarantor has
received notice of, of has knowledge of, any pending or contemplated
condemnation proceeding affecting any property subject to a Mortgage or any sale
or disposition thereof in lieu of condemnation. No property subject to a Fee
Mortgage nor any interest therein is subject to any right of first refusal,
option or other contractual right to purchase such property or interest therein,
other than Permitted Liens.
Section 4.17. Existing Indebtedness. As of the Closing Date, the Issuer and
the Guarantors will have no Debt outstanding other than (i) this Agreement, (ii)
the Exit Facility, (iii) the PIP Claim in an aggregate principal amount not
exceeding $58,457,242 as of March 31, 2001, (iv) the Government Settlement, (v)
other Debt arising under the Plan of Reorganization, (vi) Debt set forth on
Schedule 9 hereto and (vii) other Debt in an aggregate principal amount not
exceeding $1,000,000.
51
ARTICLE 5
Affirmative Covenants
Each of the Issuer and Vencor agrees that, so long as any amounts remain
outstanding under the Notes or any Obligation remains unpaid:
Section 5.01. Information. The Issuer will deliver the following
information to the Administrative Agent (with copies thereof for each Lender if
requested by the Administrative Agent) and, promptly upon receipt thereof, the
Administrative Agent will deliver a copy thereof to each Lender:
(a) as soon as available and in any event within 90 days after the end of
each Fiscal Year in the case of Vencor and its Consolidated Subsidiaries and
within 105 days after the end of each Fiscal Year (beginning with Fiscal Year
2001) in the case of the Issuer and the Restricted Subsidiaries, an audited
consolidated and an unaudited consolidating balance sheet of (i) the Issuer and
its Restricted Subsidiaries and (ii) Vencor and its Consolidated Subsidiaries,
in each case, as of the end of such Fiscal Year, and the related audited
consolidated and unaudited consolidating statements of operations, cash flows
and changes in stockholders' equity for such Fiscal Year, setting forth in each
case in comparative form the figures for the previous Fiscal Year (to the extent
available), all such consolidated financial statements reported on in a manner
acceptable to the SEC by independent public accountants of nationally recognized
standing, which report (x) shall state that such financial statements present
fairly, in all material respects, the consolidated financial position of the
Issuer and its Restricted Subsidiaries or Vencor and its Consolidated
Subsidiaries, as the case may be, as of the date of such financial statements
and their consolidated results of operations and cash flows for the period
covered by such financial statements in conformity with GAAP and (y) shall not
contain any Qualification;
(b) as soon as available and in any event within 45 days after the end of
each of the first three Fiscal Quarters of each Fiscal Year in the case of
Vencor and its Consolidated Subsidiaries and within 60 days after the end of
each of the first three Fiscal Quarters of each Fiscal Year in the case of the
Issuer and its Restricted Subsidiaries, (i) an unaudited condensed consolidated
and an unaudited condensed consolidating balance sheet of (A) the Issuer and its
Restricted Subsidiaries and (B) Vencor and its Consolidated Subsidiaries, in
each case together with the related condensed consolidated and consolidating
statements of operations for such Fiscal Quarter and for the portion of the
Fiscal Year ended at the end of such Fiscal Quarter and of cash flows for the
portion of the Fiscal Year ended at the end of such Fiscal Quarter, setting
forth in each case in comparative form the unaudited consolidated and
consolidating statements of operations and cash flows (to the extent available)
for the corresponding Fiscal Quarter and the corresponding portion of the
previous Fiscal Year, all prepared in accordance with Rule 10-01 of Regulation
S-X of the General
52
Rules and Regulations under the Securities Act of 1933, or any successor rule
that sets forth the manner in which interim financial statements shall be
prepared, and (ii) a certificate (subject to normal year-end adjustments) of a
Financial Officer and of a principal financial officer of Vencor, as applicable,
as to the fairness of presentation and consistency of such financial statements;
provided that Vencor and the Issuer may xxxx any financial statements delivered
during the 120-day period following the Closing Date as "Subject to Change" and,
if Vencor or the Issuer elects to do so, Vencor or the Issuer, as the case may
be, shall deliver final versions of such financial statements to the
Administrative Agent as soon as they are available;
(c) simultaneously with the delivery of each set of financial statements
referred to in Sections 5.01(a) and 5.01(b), a certificate of a Financial
Officer (i) setting forth in reasonable detail such calculations as are required
to establish whether the Issuer was in compliance with the requirements of
Article 6 on the date of such financial statements, (ii) stating whether any
Default exists on the date of such certificate and, if any Default then exists,
setting forth the details thereof and the action that the Issuer is taking or
proposes to take with respect thereto, (iii) stating whether, since the date of
the Most Recent Audited Financial Statements, an event has occurred or condition
arisen which has had a Material Adverse Effect which is not reflected in the
financial statements delivered simultaneously therewith and, if so, the nature
of such Material Adverse Effect, and (iv) stating whether, since the date of the
Most Recent Audited Financial Statements, there has been a change in the GAAP
applied in preparing the financial statements then being delivered from those
applied in preparing the Most Recent Audited Financial Statements which is
material to the financial statements then being delivered;
(d) simultaneously with the delivery of each set of annual financial
statements referred to in Section 5.01(a), a letter from the firm of independent
public accountants that reported on such statements stating (i) whether anything
has come to their attention in the course of their normal audit procedures to
cause them to believe that any Default existed on the date of such financial
statements and (ii) whether in their opinion the calculations of compliance with
the requirements of Article 6 set forth in the Financial Officer's certificate
delivered simultaneously therewith pursuant to Section 5.01(c), to the extent
derived from data contained in the accounting records of the Issuer and its
Restricted Subsidiaries, have been determined in accordance with the relevant
provisions of this Agreement;
(e) within five Business Days after any Executive Officer or Financial
Officer obtains knowledge of any Default, if such Default is then continuing, a
certificate of a Financial Officer setting forth the details thereof and the
action that the Issuer or Vencor is taking or proposes to take with respect
thereto;
(f) within five Business Days after any Executive Officer or Financial
Officer obtains knowledge that a notice of default has been delivered under any
53
Master Lease Agreement, Third Party Lease or Management Contract and such
default could reasonably be expected to result in an Event of Default or
Material Adverse Effect and if such default is then continuing, a certificate of
an Executive Officer or Financial Officer setting forth the details thereof and
the action that the Issuer or Guarantor is taking or proposes to take with
respect thereto;
(g) within five Business Days after any Executive Officer or Financial
Officer obtains knowledge that (i) a Facility Default (as defined in the
applicable Master Lease Agreement) has occurred or (ii) notice of termination
has been delivered, or has grounds to believe that a notice of termination is
reasonably likely to be delivered, to the Issuer or any Restricted Subsidiary by
any counterparty to any lease or management contract to which the Issuer or a
Restricted Subsidiary is a party, a certificate of an Executive Officer or
Financial Officer setting forth the details thereof and the action that the
Issuer or Guarantor is taking or proposes to take with respect thereto;
(h) promptly after the mailing thereof to Vencor's shareholders generally,
copies of all financial statements, reports and proxy statements so mailed;
(i) promptly upon the filing thereof, copies of all registration statements
(other than the exhibits thereto and any registration statements on Form S-8 or
its equivalent) and annual, quarterly or current reports that Vencor shall have
filed with the SEC;
(j) promptly after any member of the ERISA Group (i) gives or is required
to give notice to the PBGC of any "reportable event" (as defined in Section 4043
of ERISA) with respect to any Plan which might constitute grounds for a
termination of such Plan under Title IV of ERISA, or knows that the plan
administrator of any Plan has given or is required to give notice of any such
reportable event, a copy of the notice of such reportable event given or
required to be given to the PBGC; (ii) receives notice of complete or partial
withdrawal liability under Title IV of ERISA or notice that any Multiemployer
Plan is in reorganization, is insolvent or has been terminated, a copy of such
notice; (iii) receives notice from the PBGC under Title IV of ERISA of an intent
to terminate, impose liability (other than for premiums under Section 4007 of
ERISA) in respect of, or appoint a trustee to administer any Plan, a copy of
such notice; (iv) applies for a waiver of the minimum funding standard under
Section 412 of the Internal Revenue Code, a copy of such application; (v) gives
notice of intent to terminate any Plan under Section 4041(c) of ERISA, a copy of
such notice and other information filed with the PBGC; (vi) gives notice of
withdrawal from any Plan pursuant to Section 4063 of ERISA, a copy of such
notice; or (vii) fails to make any payment or contribution to any Plan or
Multiemployer Plan or makes any amendment to any Plan which has resulted or
could result in the imposition of a Lien or the posting of a bond or other
security, a certificate of a Financial Officer setting
54
forth details as to such occurrence and the action, if any, which the Issuer or
the applicable member of the ERISA Group is required or proposes to take;
(k) as soon as reasonably practicable after any Executive Officer obtains
knowledge of the commencement of an action, suit or proceeding against the
Issuer or any Guarantor before any court or arbitrator or any governmental body,
agency or official in which there is a reasonable possibility of an adverse
decision which could have a Material Adverse Effect or which in any manner
questions the validity of any Financing Document, a certificate of a Financial
Officer setting forth the nature of such action, suit or proceeding and such
additional information as may be reasonably requested by any Lender through the
Administrative Agent;
(l) promptly upon Vencor's receipt from its independent public accountants
of any management letter which indicates a material weakness in the reporting
practices of the Issuer or any Guarantor, a description of such material
weakness and any action being taken with respect thereto;
(m) promptly upon their becoming available, copies of all press releases
and other statements made available generally by the Issuer or any Guarantor to
the public concerning material developments in its business;
(n) within 15 days after the commencement of each Fiscal Year, (i) cash
flow, balance sheet and income statement forecasts in reasonable detail for the
Issuer and its Restricted Subsidiaries prepared on a monthly basis for each
Fiscal Year through the Stated Maturity Date and, promptly when available, any
material revisions of such forecast and (ii) the Issuer's business and financial
plans for such Fiscal Year, setting forth the assumptions used in preparing such
plans and, promptly when available, any material revisions of such plans;
(o) promptly upon any Person becoming or ceasing to be a Restricted
Subsidiary or Insurance Subsidiary of the Issuer, an update to Schedule 1 hereto
setting forth the information described in Section 4.13 with respect to each
Restricted Subsidiary and Insurance Subsidiary of the Issuer (it being
understood that nothing in this Section 5.01(o) shall be deemed to permit or
authorize the creation, dissolution, liquidation or acquisition of a Restricted
Subsidiary or Insurance Subsidiary of the Issuer not otherwise permitted under
this Agreement);
(p) promptly upon request of the Administrative Agent (which request may be
made on no more than one occasion in any calendar month), a report in reasonable
detail showing the amount of Temporary Cash Investments of the Issuer and its
Restricted Subsidiaries, the banks or financial institutions at which such
Temporary Cash Investments are maintained, the then yield on such Temporary Cash
Investments and such other information relating to Temporary Cash Investments of
the Issuer and its Restricted Subsidiaries as the Administrative Agent may
reasonably request; and
55
(q) from time to time such additional information regarding the financial
position, results of operations or business of the Issuer or any Guarantor as
any Lender may reasonably request in writing through the Administrative Agent.
Information required to be delivered pursuant to Sections 5.01(a), 5.01(b),
5.01(h), 5.01(i) and 5.01(m) shall be deemed to have been delivered on the date
on which the Issuer provides notice to the Lenders that such information has
been posted on Vencor's website on the Internet at the website address listed on
the signature pages hereof, at xxx.xxx/xxxxx/xxxxxxxx.xxx or at another website
identified in such notice and accessible by the Lenders without charge; provided
that (i) such notice may be included in a certificate delivered pursuant to
Section 5.01(c) and (ii) Vencor shall deliver paper copies of the information
referred to in Sections 5.01(a), 5.01(b), 5.01(h), 5.01(i) and 5.01(m) to any
Lender that requests such delivery.
Section 5.02. Maintenance of Property. The Issuer and each Guarantor will
keep all property useful and necessary in its business in good working order and
condition, ordinary wear and tear and casualty excepted.
Section 5.03. Insurance.
(a) The Issuer and each Guarantor will maintain insurance with responsible
companies in such amounts and against such risks as is usually carried by owners
of similar businesses and properties in the same general areas in which it
operates.
(b) If the Issuer or any Guarantor fails to maintain any insurance policy
required to be maintained under this Section 5.03, the Collateral Agent shall
have the right to maintain such policy or obtain a comparable policy, and in
either case pay the premiums therefor. If the Collateral Agent maintains or
obtains any such policy and pays the premiums therefor, the Issuer will
reimburse the Collateral Agent upon demand for its expenses in connection
therewith, including interest thereon for each day at a rate per annum equal to
the Default Rate.
Section 5.04. Compliance with Law, Etc. The Issuer and each Guarantor will
comply in all material respects with all Applicable Laws (including Medicare
Regulations, Medicaid Regulations, Environmental Laws and ERISA and the rules
and regulations thereunder and with the Corporate Integrity Agreement), except
where (i) the necessity of compliance therewith is contested in good faith by
appropriate measures or proceedings, in which case adequate and reasonable
reserves will be established in accordance with GAAP and notice of each such
contest (other than contests in the ordinary course of business) shall be given
to the Administrative Agent, or (ii) failures to comply therewith could not, in
the aggregate, reasonably be expected to have a Material Adverse Effect.
56
Section 5.05. Maintenance of Existence, Rights, Etc. The Issuer and each
Guarantor will preserve, renew and keep in full force and effect its existence
and its rights, privileges, licenses and franchises necessary or desirable in
the normal conduct of business; provided that nothing in this Section shall
prohibit (a) any merger or consolidation permitted by Section 7.03, (b) the
termination of the existence of any Subsidiary if (i) the Issuer determines that
such termination is in its best interest and (ii) such termination is not
adverse in any material respect to the Lenders, (c) the loss of any rights,
privileges, licenses and franchises if the loss thereof, in the aggregate, could
not reasonably be expected to have a Material Adverse Effect or (d) the Issuer
or any Guarantor from changing its name to the name set forth below the name of
the Issuer or such Guarantor on the Perfection Certificate delivered pursuant to
the Security Agreement, so long as the Issuer and such Guarantor comply with the
requirements of Section 5 of the Security Agreement in connection with such name
change.
Section 5.06. Environmental Matters. (a) From time to time after the
Closing, Vencor will review the effect of Environmental Laws on the business,
operations and properties of the Issuer and the Guarantors, in the course of
which reviews it will identify and evaluate associated liabilities and costs.
If, on the basis of such reviews, Vencor reasonably concludes that the foregoing
associated liabilities and costs are likely to have a Material Adverse Effect,
Vencor shall promptly deliver a certificate to the Administrative Agent setting
forth its conclusion and the action that Vencor proposes to take with respect
thereto.
(b) Unless the Environmental Liabilities of the Issuer and the Guarantors
that relate to or could result from the matters referred to in this Section
5.06(b) would not exceed $1,000,000 for any one occurrence, Vencor shall
promptly notify the Administrative Agent of any material notice, notification,
demand, request for information, citation, summons, complaint or order (any such
communication, an "Environmental Notice") with respect to Hazardous Substances
or any violation of Environmental Laws that is then in existence or, to the
knowledge of Vencor, proposed, threatened or anticipated with respect to or in
connection with the operation of any properties to be owned, leased or operated
after the Closing Date by the Issuer or any Guarantor, which notice shall set
forth a copy of such Environmental Notice, if applicable, and such additional
information as may be reasonably requested by the Administrative Agent with
respect thereto.
Section 5.07. Designation of Unrestricted Subsidiaries. (a) The Board of
Directors of the Issuer may designate any Subsidiary, including a newly acquired
or created Subsidiary, to be an Unrestricted Subsidiary if the sum of the total
assets of such Subsidiary (or, if any such Subsidiary itself has Subsidiaries,
the consolidated total assets of such Subsidiary and its Consolidated
Subsidiaries) and every other Unrestricted Subsidiary, in each case determined
as of the date of the Most Recent Financial Statements, does not exceed 5% of
the consolidated total assets of the Issuer
57
and its Consolidated Subsidiaries and the designation would not cause a Default;
provided that:
(i) Such Subsidiary does not own any capital stock of the Issuer or
any Restricted Subsidiary or hold any Debt of, or any Lien on any property
of, the Issuer or any Restricted Subsidiary.
(ii) At the time of designation, the designation would be permitted
under Section 7.08.
(iii) To the extent the Debt of the Subsidiary is not Non-Recourse
Debt, any Guarantee or other credit support thereof by the Issuer or any
Restricted Subsidiary is permitted under Sections 7.01 and 7.08.
(iv) The Subsidiary is not party to any transaction or arrangement
with the Issuer or any Restricted Subsidiary that would not be permitted
under Section 7.04.
(v) Neither the Issuer nor any Restricted Subsidiary has any
obligation to subscribe for additional Equity Interests of the Subsidiary
or to maintain or preserve its financial condition or cause it to achieve
specified levels of operating results except to the extent permitted by
Sections 7.01 and 7.08.
Once so designated the Subsidiary will remain an Unrestricted Subsidiary,
subject to paragraph (b).
(b) (i) If as of the date of the Most Recent Financial Statements, the
conditions specified in paragraph (a) are not satisfied, the Board of Directors
of the Issuer shall immediately designate one or more Unrestricted Subsidiaries
as Restricted Subsidiaries to the extent required to ensure that the conditions
specified in paragraph (a) would have been satisfied as of the date of the Most
Recent Financial Statements, subject to the consequences set forth in paragraph
(d).
(ii) The Board of Directors of the Issuer may designate an
Unrestricted Subsidiary to be a Restricted Subsidiary if the designation
would not cause a Default.
(c) Upon a Restricted Subsidiary becoming an Unrestricted Subsidiary,
(i) all existing Investments of the Issuer and the Restricted
Subsidiaries therein (valued at the Issuer's proportional share of the fair
market value of its assets less liabilities) will be deemed made at that
time;
58
(ii) all existing capital stock or Debt of the Issuer or a
Restricted Subsidiary held by it will be deemed incurred at that time, and
all Liens on property of the Issuer or a Restricted Subsidiary held by it
will be deemed incurred at that time;
(iii) all existing transactions between it and the Issuer or any
Restricted Subsidiary will be deemed entered into at that time;
(iv) it is released at that time from the Subsidiary Guaranty
Agreement, if it is a party thereto; and
(v) it will cease to be subject to the provisions of this Agreement
as a Restricted Subsidiary.
(d) Upon an Unrestricted Subsidiary becoming a Restricted Subsidiary,
(i) all of its Debt will be deemed incurred at that time for
purposes of Section 7.01, but will not be considered the sale or issuance
of Equity Interests for purposes of Sections 7.03(d) or 7.06;
(ii) Investments therein previously charged under Section 7.08 will
be credited thereunder;
(iii) it must issue a Guarantee of the Notes pursuant to Section 5.08
and execute a Security Agreement Supplement pursuant to Section 5.09; and
(iv) it will thenceforward be subject to the provisions of this
Agreement as a Restricted Subsidiary.
(e) Any designation by the Board of Directors of the Issuer of a Subsidiary
of the Issuer as a Restricted Subsidiary or Unrestricted Subsidiary will be
evidenced to the Administrative Agent by promptly filing with the Administrative
Agent a copy of the board resolution giving effect to the designation and a
certificate of an Executive Officer certifying that the designation complied
with the foregoing provisions.
Section 5.08. Guarantees by Future Restricted Subsidiaries. Within five
Business Days after any Person becomes a Restricted Subsidiary, the Issuer shall
(i) cause such Restricted Subsidiary to guarantee the Issuer's obligations
hereunder pursuant to a Subsidiary Guaranty Agreement and (ii) deliver to the
Agents such legal opinions and other documents as the Agents may reasonably
request relating to the existence of such Restricted Subsidiary, the corporate
or other authority for and validity of its Subsidiary Guaranty Agreement and any
other matters relevant thereto, all in form and substance satisfactory to the
Agents.
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SECTION 5.09. Future Assets to Be Added to Collateral.
(a) Within 5 Business Days after any Person becomes or is deemed to have
become a Restricted Subsidiary, an Insurance Subsidiary or an insurance
subsidiary of Vencor or ceases to be an Excluded Partnership after the date
hereof, the Issuer or Vencor shall cause all Equity Interests in such Person
owned by the Issuer or the Guarantors to be pledged under the Security
Agreement; provided that, if regulatory consent is required to permit any such
pledge of Equity Interests in an insurance subsidiary, (i) such pledge shall not
be required unless such regulatory consent is reasonably obtainable and (ii) if
such regulatory consent is reasonably obtainable, the Issuer or Vencor shall
exercise all reasonable efforts to obtain it and shall not be required to pledge
such Equity Interests until it is obtained.
(b) If at any time after the Closing Date the Issuer or a Guarantor
acquires a Material Real Property that is not included in the Collateral, the
Issuer shall, within two Business Days after it or such Guarantor acquires such
Material Real Property, provide notice thereof to the Administrative Agent and,
within 30 days after it or such Guarantor acquires such Material Real Property,
cause such Material Real Property to be added to the Collateral by delivering to
the Collateral Agent a Fee Mortgage with respect thereto and the appropriate UCC
form for the related fixture filing, all in form and substance reasonably
satisfactory to the Administrative Agent.
(c) Within 30 days after the commencement of each Fiscal Year, the Issuer
shall deliver a leasehold report to the Administrative Agent setting forth a
list of each Material Real Property leased by it or any Guarantor under a lease
with respect to which its or such Guarantor's leasehold interest is not included
in the Collateral. The Administrative Agent may (and if it is requested to do so
by the Required Lenders shall) request the Issuer to cause any such leasehold
interest not subject to a negative pledge to be added to the Collateral by
delivering to the Collateral Agent a Leasehold Mortgage with respect thereto and
the appropriate UCC form for the related fixture filing, all in form and
substance reasonably satisfactory to the Administrative Agent. The Issuer shall,
and shall cause each Guarantor to, attempt in good faith to cause any such lease
of a Material Real Property to (i) not contain a negative pledge (subject to
prevailing market conditions) and (ii) contain provisions for the benefit of a
leasehold mortgagee comparable to those contained in the Master Lease Agreements
and to obtain a non-disturbance agreement with respect to such lease on
customary terms.
(d) Within 5 Business Days after any Person becomes a Restricted
Subsidiary or ceases to be an Excluded Partnership (provided that such Person
remains a Subsidiary), the Issuer will (i) cause such Person to sign and deliver
a Subsidiary Guaranty Agreement and Security Agreement Supplement granting a
Lien or Liens on substantially all the personal property included in its assets
(with the exceptions set forth in the first proviso at the end of Section 3 of
the Security Agreement and such other exceptions as the Agents shall have
approved in writing) to
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the Collateral Agent to secure its Secured Obligations and (ii) cause such
Person to comply with the provisions thereof and of the Security Agreement and
Subsidiary Guaranty Agreement.
(e) Whenever any asset is added to the Collateral pursuant to this Section
5.09, the Issuer shall deliver to the Administrative Agent and Collateral Agent
such legal opinions and other documents as the Administrative Agent or
Collateral Agent may reasonably request relating to the existence of the
relevant Lien Grantor, the corporate or other authority for and validity of the
Collateral Documents applicable thereto, the creation and perfection (or due
recordation) of the Lien purportedly created thereby and any other matters
relevant thereto (including the insurance), all in form and substance
satisfactory to the Administrative Agent and Collateral Agent.
Section 5.10. Casualty Events.
(a) All Casualty Proceeds received by the Collateral Agent, the Issuer or
any of its Restricted Subsidiaries shall be applied as set forth in Section
2.06(a).
(b) If any Condemnation Event occurs with respect to property owned or
leased by the Issuer or any of its Restricted Subsidiaries, or if any
negotiation or proceeding is commenced which might result in such a Condemnation
Event, or if any such Condemnation Event is proposed or threatened, the Issuer
or such Restricted Subsidiary (i) will, promptly after receiving notice or
obtaining knowledge thereof, do all things deemed necessary or appropriate by it
to preserve its interest in such property and promptly make claim for awards
payable with respect thereto and diligently pursue to conclusion such claim and
any suit, action or other proceeding necessary or appropriate to obtain payment
thereof and (ii) will not settle any such claim, negotiation or proceeding
without the consent of the Collateral Agent if an Enforcement Notice is in
effect.
Section 5.11. Ranking. The Issuer and Vencor shall, and shall procure that
each other Guarantor shall, procure that its respective payment obligations
under the Notes or the Guaranty Agreements (as applicable) do and will at all
times rank at least xxxx xxxxx in right and priority of payment with all of its
other present and future Debt, other than the Senior Obligations.
Section 5.12. Post-Closing. (a) No later than 15 days after the Closing
Date, the Issuer shall deliver a schedule to the Administrative Agent setting
forth the correct address of each real property that was owned by the Issuer or
any Guarantor as of the Closing Date.
(b) (i) The Issuer agrees to deliver to the Collateral Agent as soon as
practicable but in no event later than 45 days after the Closing Date,
replacement stock certificates evidencing Equity Interests in each entity
referred to in paragraph 1
61
of Schedule 11, together with stock powers executed in blank or other
appropriate instruments of pledge relating thereto.
(ii) The Issuer agrees to deliver to the Collateral Agent as soon as
practicable but in no event later than 60 days after the Closing Date,
stock certificates evidencing Equity Interests in each entity referred to
in paragraph 2 of Schedule 11, together with stock powers executed in blank
or other appropriate instruments of pledge relating thereto.
(iii) Notwithstanding the foregoing provisions of this clause (b), if
despite the Issuer's best efforts, the Issuer fails to deliver any of the
foregoing items to the Collateral Agent within the time periods specified
above, the Collateral Agent may (but shall not be obligated to) consent to
additional time periods for such delivery.
(c) If at any time the granting of a pledge or other security interest
over the Equity Interests in Cornerstone is not prohibited by Cayman Islands
law, Vencor shall ensure that a pledge or such other security interest over such
Equity Interests is granted to the Collateral Agent for the benefit of the
Lenders and that stock certificates evidencing such Equity Interests are
promptly delivered to the Collateral Agent together with signed stock powers or
other appropriate instruments of transfer relating thereto. Prior to such time,
Vencor shall ensure that no Lien over such Equity Interests is granted to any
Person.
(d) Vencor shall (i) ensure that the Liens and title defects listed on the
schedule to the Encumbrance Letter are paid, discharged or removed in accordance
with the provisions of, and within the time periods (if any) specified in, the
Encumbrance Letter and (ii) comply with the other provisions of the Encumbrance
Letter.
(e) As soon as practicable but in no event later than 60 days after the
Closing Date, the Issuer shall cause the Shell Subsidiary to be liquidated or
dissolved and shall, in connection with the foregoing, cause all personal, real
and mixed property, if any, of such Shell Subsidiary to be transferred to a
Restricted Subsidiary.
ARTICLE 6
FINANCIAL COVENANTS
The Issuer agrees that, so long as any amounts remain outstanding under the
Notes or any Obligation remains unpaid:
62
SECTION 6.01. Fixed Charge Coverage Ratio (EBITDAR). (a) At each Quarterly
Measurement Date on or after June 30, 2001, the ratio of (i) Consolidated
EBITDAR for the four consecutive Fiscal Quarters then ended to (ii) the sum of
Consolidated Interest Expense plus Consolidated Rental Expense plus the
aggregate principal amount of Debt of the Issuer and its Restricted Subsidiaries
scheduled to be amortized, in each case for the same four Fiscal Quarters, will
not be less than 1.0l:1; provided that (x) at any Quarterly Measurement Date
prior to the end of the fourth full Fiscal Quarter after the Closing Date, the
foregoing amounts shall be calculated as of the end of the then most recently
ended Fiscal Quarter on an Annualized Basis, (y) any amounts payable by the
Issuer and its Restricted Subsidiaries pursuant to Section 6.12(a)(l)(i) and
(ii) of the Plan of Reorganization in respect of the Government Settlement
during any relevant calculation period shall be excluded from the calculation of
the foregoing amounts for such period and (z) the principal amount of loans
payable under the Exit Facility on the date of final maturity thereof shall be
excluded from the calculation of the foregoing amounts for the period during
which such date occurs.
(b) For purposes of calculating the foregoing ratio, if any corporation or
other entity shall have been acquired by the Issuer or any Restricted Subsidiary
during the period for which Consolidated EBITDAR is to be calculated and if such
corporation or other entity becomes a Restricted Subsidiary during such period,
Consolidated EBITDAR shall be calculated as if such corporation or other entity
had been acquired at the beginning of such period, to the extent that the
relevant financial information with respect to it for the portion of such period
prior to such acquisition can be determined with reasonable accuracy.
SECTION 6.02. Total Leverage Ratio. (a) On or after June 30, 2001, the
ratio of (x) Consolidated Debt for Borrowed Money to (y) Consolidated EBITDA for
the four consecutive Fiscal Quarters then most recently ended will not exceed
3.95:l; provided that for dates prior to the end of the fourth full Fiscal
Quarter after the Closing Date, Consolidated EBITDA shall be determined as of
the end of the then most recently ended Fiscal Quarter on an Annualized Basis;
provided further that any amounts payable by the Issuer and its Restricted
Subsidiaries pursuant to Section 6.12(a)(l)(i) and (ii) of the Plan of
Reorganization in respect of the Government Settlement during any relevant
calculation period shall be excluded from the calculation of the foregoing
amounts for such period.
(b) For purposes of calculating the foregoing ratio, if any corporation or
other entity shall have been acquired by the Issuer or any Restricted Subsidiary
during the period for which Consolidated EBITDA is to be calculated and if such
corporation or other entity becomes a Restricted Subsidiary during such period,
Consolidated EBITDA shall be calculated as if such corporation or other entity
had been acquired at the beginning of such period, to the extent that the
relevant financial information with
63
respect to it for the portion of such period prior to such acquisition can be
determined with reasonable accuracy.
SECTION 6.03. Minimum Consolidated Net Worth. Consolidated Net Worth will
not be less than the Minimum Compliance Level. The "Minimum Compliance Level"
means, at each Quarterly Measurement Date (the "date of determination"), an
amount equal to the sum of (i) 100% of the Consolidated Net Worth as of the
Closing Date minus (ii) $50,000,000 plus (iii) for each full Fiscal Quarter
ending after the Closing Date and on or prior to the date of determination for
which Consolidated Net Income is a positive number, an amount equal to 50% of
such positive number.
SECTION 6.04. Capital Expenditures. Consolidated Capital Expenditures will
not, for any Fiscal Year listed below, exceed the amount indicated for such
Fiscal Year:
Fiscal Year Amount
----------- ------
2001 $75,000,000
2002 $75,000,000
2003 $80,000,000
2004 $80,000,000
2005 $85,000,000
2006 $85,000,000
2007 $90,000,000
2008 $90,000,000
ARTICLE 7
Negative Covenants
Each of the Issuer and Vencor agrees that, so long as any amounts remain
outstanding under the Notes or any Obligation remains unpaid:
SECTION 7.01. Limitation on Debt. (a) The Issuer shall not, and shall not
permit any Restricted Subsidiary to, incur or be liable with respect to (i) any
Debt of a type described in clause (i), (ii) or (iv) of the definition of "Debt"
in Section 1.01 or (ii) any Guarantee of any such Debt described in clause (i)
above; provided that the Issuer and its Restricted Subsidiaries may incur such
Debt if, on the date of the incurrence, after giving effect to the incurrence
and the receipt and application of the proceeds thereof, the Fixed Charge
Coverage Ratio (EBITDA) is not less than 3.5:1.
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(b) Notwithstanding the foregoing, the Issuer and its Restricted
Subsidiaries may incur and be liable for each and all of the following:
(i) Debt outstanding under the Financing Documents;
(ii) Debt under or in respect of the Exit Facility in an aggregate
principal amount not to exceed $120,000,000 less any amounts up to an
aggregate not to exceed $45,000,000 by which the commitments under the Exit
Facility have been permanently reduced;
(iii) Debt outstanding on the Closing Date, including the Government
Settlement and any other obligations arising under the Plan of
Reorganization;
(iv) Capital Lease Obligations; provided that the aggregate
outstanding principal amount of Debt permitted by this clause (iv) and by
clause (v) shall not at any time exceed $25,000,000;
(v) Debt incurred or assumed after the Closing Date for the purpose
of financing all or any part of the cost of acquiring or constructing an
asset of the Issuer or a Restricted Subsidiary; provided that (A) such Debt
is secured by a Lien on such asset that is permitted by Section 7.02(g) and
(B) the aggregate outstanding principal amount of all Debt permitted by
clause (iv) and this clause (v) shall not at any time exceed $25,000,000;
(vi) Debt of any Person that becomes a Restricted Subsidiary after
the Closing Date in connection with an Acquisition; provided that such Debt
was outstanding before such Person became a Restricted Subsidiary and was
not incurred in contemplation thereof;
(vii) Debt incurred after the Closing Date and Guarantees of Debt
entered into after the Closing Date; provided that (A) the Debt so incurred
or Guaranteed is incurred in exchange for or to repay, prepay, repurchase,
redeem, defease, retire or refinance ("refinance") any outstanding Debt of
the Issuer or any Restricted Subsidiary otherwise permitted by this Section
and (B) the principal amount of the Debt so incurred or Guaranteed shall not
exceed the unpaid principal amount of the Debt so exchanged or refinanced;
provided that in connection with any refinancing of the Exit Facility, the
principal amount of the Debt incurred or to be incurred pursuant to such
refinancing may be in an amount equal to the aggregate amount of the
commitments under the Exit Facility immediately prior to such refinancing;
(viii) Permitted Intercompany Debt;
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(ix) Debt consisting of trade obligations arising in the ordinary
course of business after the Closing Date;
(x) Debt under Interest Rate Agreements of the Issuer or any
Restricted Subsidiary relating to Debt permitted to be incurred and
outstanding under this Section and entered into in the ordinary course of
business for the purpose of limiting interest rate risks and not for
speculation; and
(xi) Debt owed in respect of any overdrafts and related liabilities
arising from treasury, depository and cash management services or in
connection with any automated clearing house transfers of funds.
(c) Vencor may:
(i) Guarantee the obligations of the Issuer under the Exit
Facility;
(ii) Guarantee the obligations of the Issuer under this Agreement as
set forth in the Vencor Guaranty;
(iii) Guarantee the obligations of the Issuer or any Restricted
Subsidiary under any real property lease to which the Issuer or such
Restricted Subsidiary is a party;
(iv) Guarantee Debt incurred by any Vencor Unrestricted Subsidiary;
and
(v) incur or be liable with respect to any other Debt;
provided that in the case of any Guarantee or Debt described in clauses (iv) and
(v), Vencor may not give such Guarantee or incur such Debt unless its
obligations thereunder are expressly subordinated to the Vencor Guaranty
pursuant to subordination provisions in substantially the form of Exhibit J. The
ability of any Vencor Unrestricted Subsidiary to incur Debt is not limited by
this Agreement.
Section 7.02. Negative Pledge. The Issuer shall not, and shall not permit
any Restricted Subsidiary to, create, assume or suffer to exist any Lien
securing any Debt on any asset now owned or hereafter acquired by it (or any
income therefrom or any right to receive income therefrom), except:
(a) Liens created pursuant to the Collateral Documents;
(b) Liens securing Senior Obligations;
66
(c) Liens existing on the Closing Date securing Debt described in clause
(iii) of Section 7.01(b);
(d) any Lien existing on any asset prior to the acquisition thereof by the
Issuer or a Restricted Subsidiary; provided that such Lien was not created in
contemplation of such event and does not extend to any other property of the
Issuer or any Restricted Subsidiary;
(e) any Lien existing on any asset of any Person at the time such Person
becomes a Restricted Subsidiary or merges into the Issuer or any of its
Restricted Subsidiaries in connection with an Acquisition; provided that such
Lien was not created in contemplation of such event and does not extend to any
other property of the Issuer or any Restricted Subsidiary;
(f) Liens upon the assets of the Issuer and its Restricted Subsidiaries
subject to Capital Lease Obligations to the extent permitted by Section
7.0l(b)(iv); provided that (i) such Liens only serve to secure the payment of
Debt arising under such Capital Lease Obligation, (ii) the Lien encumbering the
asset giving rise to the Capital Lease Obligation does not encumber any other
asset of the Issuer or any Restricted Subsidiary and (iii) the aggregate
outstanding principal amount of all Debt secured pursuant to this clause (f) and
clause (g) shall not exceed $25,000,000;
(g) any Lien on any asset securing Debt incurred or assumed for the
purpose of financing all or any part of the cost of acquiring or constructing
such asset, provided that (i) such Lien attaches to such asset concurrently with
or within 180 days after the acquisition or completion of construction thereof
and attaches to no asset other than such asset so financed and (ii) the
aggregate outstanding principal amount of all Debt secured pursuant to clause
(f) and this clause (g) shall not exceed $25,000,000;
(h) Liens securing Debt of the Issuer or a Restricted Subsidiary to the
Issuer or a Wholly Owned Restricted Subsidiary;
(i) any Lien arising out of the refinancing (as defined in Section
7.0l(b)(vii)) of any Debt secured by any Lien permitted by this Section,
provided that the principal amount of such Debt is not increased (except as set
forth in the second proviso to Section 7.0l(b)(vii)) and such refinanced Debt is
not secured by any additional assets;
(j) Permitted Encumbrances;
(k) Liens on deposit account balances and Temporary Cash Investments in an
amount not exceeding $2,000,000 securing Interest Rate Agreements; and
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(l) Liens created in favor of the Collateral Agent (for the benefit of
Lenders) pursuant to the Collateral Documents or in favor of the Exit Facility
Collateral Agent (for the benefit of holders of Senior Obligations).
Section 7.03. Consolidations, Mergers and Asset Sales.
(a) The Issuer shall not, Vencor shall not, and the Issuer shall not
permit any Restricted Subsidiary to, consolidate or merge with or into, or sell,
lease or otherwise dispose of all or substantially all of its assets to any
other Person, except that:
(i) Vencor may merge with any Person (other than the Issuer or a
Restricted Subsidiary) if Vencor is the surviving corporation and,
immediately after such merger (and giving effect thereto), no Default shall
have occurred and be continuing;
(ii) the Issuer may merge with any Person (other than Vencor) if the
Issuer is the surviving corporation and, immediately after such merger (and
giving effect thereto), no Default shall have occurred and be continuing;
and
(iii) any Restricted Subsidiary may merge or consolidate with or into,
and the Issuer or any Restricted Subsidiary may transfer all or
substantially all of its assets to, any Person if, immediately after such
transaction (and giving effect thereto), no Default shall have occurred and
be continuing and (A) the surviving corporation or transferee is the Issuer
or a Restricted Subsidiary, (B) in the case of a Restricted Subsidiary,
such merger, consolidation or transfer of all or substantially all assets
is in conjunction with a disposition by the Issuer and its Restricted
Subsidiaries of their entire investment in such Subsidiary and such
disposition is not prohibited by any provision of the Financing Documents
(other than this subsection (a)); provided that the foregoing shall not
prohibit any transaction permitted by Section 7.03(d), (C) the Required
Lenders shall have consented to such transaction or (D) immediately after
such transaction is consummated, the aggregate book value of all assets
disposed of in transactions permitted by this clause (D) during the period
of 365 days then ended (whether disposed of directly or by means of a
merger, consolidation or transfer of Equity Interests) would not exceed 5%
of Consolidated Net Worth as shown on the Most Recent Financial Statements.
For purposes of Section 7.03(a)(iii)(D), the book value of the assets disposed
of in each transaction shall be the book value of such assets on the books of
the relevant Subsidiary immediately before such disposition.
(b) If the Issuer and its Restricted Subsidiaries dispose of their entire
investment in any Restricted Subsidiary as permitted by subsection (a) above,
the Administrative Agent shall at the Issuer's request instruct the Collateral
Agent,
68
concurrently with or at any time after such disposition, to release all security
interests in Equity Interests in such Subsidiary granted by the Issuer and its
Restricted Subsidiaries to the Collateral Agent. In addition, (i) such
Restricted Subsidiary's Subsidiary Guaranty shall be automatically released and
it shall cease to be a party to the Security Agreement, in each case
concurrently with such disposition, and (ii) the Administrative Agent shall at
the Issuer's request instruct the Collateral Agent, concurrently with or at any
time after such disposition, to release all security interests granted by such
Subsidiary to secure its Subsidiary Guaranty and return to such Subsidiary any
of its assets held by the Collateral Agent under the Collateral Documents.
(c) Notwithstanding the foregoing, clause (a) of this Section 7.03 shall
not apply to any sale or other disposition of Atria Shares or BHC Shares, and
any such transaction shall be excluded from calculations under Section
7.03(a)(iii)(D).
(d) The Issuer shall not, and shall not permit any Restricted Subsidiary
to, make any Asset Sale, unless:
(i) the consideration received from such Asset Sale shall be in an
amount at least equal to the fair market value thereof (as determined in
good faith by the Issuer (which determination, if the sale price exceeds
$5,000,000, shall be evidenced by a resolution of the Issuer's Board of
Directors) as at the time of such Asset Sale); and
(ii) at least 80% of the consideration received shall be in the form
of cash received at closing (for purposes of this clause only, the
assumption by the purchaser of Debt or other obligations of the Issuer or a
Restricted Subsidiary relating to the assets subject to such Asset Sale
pursuant to a customary novation agreement and the release of the Issuer or
the Restricted Subsidiary (as the case may be) of its obligations relating
to such Debt or other obligations, and instruments or securities received
from the purchaser that are promptly, but in any event within 30 days of the
closing, converted by the Issuer to cash, to the extent of the cash actually
so received, shall be considered cash received at closing); and
(iii) the Net Cash Proceeds received at such closing shall be
deposited in a Collateral Account and applied as set forth in Section
2.06(a);
provided that the Kingfish Transaction shall not be subject to the foregoing
provisions.
Section 7.04. Limitations on Transactions with Affiliates. The Issuer shall
not, and shall not permit any Restricted Subsidiary to, directly or indirectly,
pay any funds to or for the account of, make any Investment in, lease, sell,
transfer or
69
otherwise dispose of any assets, tangible or intangible, to, or participate in,
or effect any transaction in connection with any joint enterprise or other joint
arrangement with, any Affiliate; provided that the foregoing shall not prohibit:
(i) the Issuer or any Restricted Subsidiary from performing its
obligations under the Existing Affiliate Agreements;
(ii) the Issuer or any Restricted Subsidiary from making any
Investment in Minority-Owned Affiliates permitted by Section 7.08;
(iii) the Issuer or any Restricted Subsidiary from making sales or
leases to or purchases or leases from any Affiliate and, in connection
therewith, extending credit or making payments, or from making payments for
services rendered by any Affiliate, if such sales, leases or purchases are
made or such services are rendered in the ordinary course of business and on
terms and conditions at least as favorable to the Issuer or such Restricted
Subsidiary as the terms and conditions which would apply in a similar
transaction with a Person not an Affiliate;
(iv) the Issuer or any Restricted Subsidiary from making payments to
Vencor in amounts as shall be necessary to permit Vencor to pay costs and
expenses incurred by it in the ordinary course in connection with
maintaining its status as a public company (including, without limitation,
transfer agent fees, registration fees, stock exchange fees, costs for
shareholder communications and other similar costs and expenses) or on
account of intercompany allocation matters; provided that (w) Vencor shall
have received an invoice requiring payment of such cost or expense and shall
have forwarded a copy thereof to the Issuer, (x) Vencor shall pay such cost
or expense within 15 days of receipt of amounts from the Issuer or any
Restricted Subsidiary pursuant to this clause, (y) in the case of any
payment on account of intercompany allocation matters, such payment is
allocated between the Issuer and its Restricted Subsidiaries and the other
Vencor Companies on a basis that reflects the actual use to the extent
practicable and, to the extent such allocation is not practicable, on a
basis reasonably related to actual use and (z) the aggregate amount of
payments made pursuant to this clause (iv) during each of the periods
referred to below shall not exceed the amount set forth opposite such
period:
-----------------------------------------------------------------------
Period Amount
-----------------------------------------------------------------------
Closing Date to but excluding $ 2,000,000
first anniversary thereof:
-----------------------------------------------------------------------
Each 12-month period thereafter: $ 750,000
-----------------------------------------------------------------------
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(v) the Issuer or any Restricted Subsidiary from making payments of
principal, interest and premium on any of its Debt held by an Affiliate if
the terms of such Debt are substantially as favorable to the Issuer or such
Restricted Subsidiary as the terms which could have been obtained at the
time of the creation of such Debt from a lender which was not an Affiliate;
(vi) to the extent permitted by Section 7.08, the Issuer or any
Restricted Subsidiary from participating in, or effecting any transaction
in connection with, any joint enterprise or other joint arrangement with
any Affiliate if the Issuer or such Restricted Subsidiary participates in
the ordinary course of its business and on a basis no less advantageous
than the basis on which such Affiliate participates;
(vii) the Issuer or any Restricted Subsidiary from maintaining,
entering into or adopting any executive or employee incentive or
compensation plan, contract or other arrangement (including any loans or
extensions of credit in connection therewith to the extent permitted by
Section 7.08), or any arrangement to terminate any of the foregoing, if
such plan, contract, or arrangement has been or is approved either (x) at
any time by the shareholders of Vencor in accordance with such voting
requirements as may be applicable or (y) at any time by the board of
directors of Vencor (or a duly constituted committee of such board) at a
meeting at which a quorum of disinterested directors is present;
(viii) to the extent permitted by Section 7.08, the Issuer or any
Restricted Subsidiary from making any loan, guarantee or other
accommodation in accordance with Vencor's policies and practices concerning
employee relocation in the ordinary course of its business; or
(ix) any Restricted Payments permitted by Section 7.07.
Section 7.05. Limitation on Restrictions Affecting Subsidiaries. The Issuer
shall not, and shall not permit any Restricted Subsidiary to, enter into, or
suffer to exist, any agreement (other than the Financing Documents and the Exit
Facility Financing Documents and, in the case of clause (c), the Master Lease
Agreements) which prohibits or limits the ability of any Restricted Subsidiary
to (a) pay dividends or make any other distributions or pay any Debt owed to the
Issuer or any other Restricted Subsidiary; (b) make loans or advances to the
Issuer or any other Restricted Subsidiary or (c) create, incur, assume or suffer
to exist any Lien upon any of its property, assets or revenues, whether now
owned or hereafter acquired, to secure the obligations of the Issuer and the
Guarantors under the Financing Documents and the Exit Facility Financing
Documents; provided that the foregoing shall not prohibit any such prohibition
or limitation contained in:
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(i) any document relating to Debt secured by a Lien permitted by
Section 7.02, insofar as the provisions thereof limit grants of junior
liens on the assets securing such Debt;
(ii) any operating lease or capital lease, insofar as the provisions
thereof limit grants of a security interest in, or other assignments of,
the related leasehold interest to any other Person; and
(iii) if a Person becomes a Restricted Subsidiary after the date
hereof, any agreement that is binding on such Person and was not entered
into in contemplation of its becoming a Restricted Subsidiary, insofar as
such agreement limits such Person's ability to take any action described in
clause (a), (b) or (c) of this Section, provided that either:
(A) such limitation is terminated within 60 days after such
Person becomes a Restricted Subsidiary; or
(B) not more than 5% of Consolidated EBITDAR for any period of
four consecutive Fiscal Quarters is attributable, in the aggregate, to
Persons that become Restricted Subsidiaries after the date hereof and
remain subject to such limitations more than 60 days after becoming
Restricted Subsidiaries.
Section 7.06. Limitation on Sale or Issuance of Equity Interests of
Restricted Subsidiaries. The Issuer shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, sell or issue any Equity
Interests of a Restricted Subsidiary unless:
(a) the sale or issuance is to the Issuer or a Wholly Owned Restricted
Subsidiary; or
(b) (i) if, after giving effect to the sale or issuance, the Restricted
Subsidiary would no longer be a Restricted Subsidiary, all remaining Investments
of the Issuer and the Restricted Subsidiaries in such former Restricted
Subsidiary (valued at an amount equal to the Issuer's remaining proportional
share of the fair market value of such former Restricted Subsidiary's assets
less liabilities), if deemed made at that time, would be permitted under Section
7.08 and (ii) the Issuer complies with Section 7.03(d) with respect to the sale
or issuance.
Section 7.07. Restricted Payments. (a) The Issuer shall not, and shall not
permit any Restricted Subsidiary to, declare or make any Restricted Payment on
or after the Closing Date, except that:
(i) any Restricted Subsidiary may declare and make Restricted
Payments to the Issuer or any Wholly Owned Restricted Subsidiary;
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(ii) the Issuer may declare or make Restricted Payments to Vencor
for the purchase, redemption or other acquisition or retirement for value of
Equity Interests of Vencor held by (A) officers, directors or employees or
former officers, directors or employees (or their estates or beneficiaries under
their estates), upon death, disability, retirement, severance or termination of
employment or (B) Ventas, to the extent required to satisfy the requirements of
Article XII of Vencor's Amended and Restated Certificate of Incorporation;
provided that the aggregate amount paid to Vencor pursuant to this clause (ii)
does not exceed an aggregate amount of $500,000;
(iii) the Issuer may declare or make Restricted Payments to Vencor of
required amounts notified to Vencor in writing from time to time by the
insurance regulatory authorities in the Cayman Islands; provided that Vencor
shall (x) promptly upon receipt of any such notice, forward a copy thereof to
the Administrative Agent and (y) invest all Restricted Payments received
pursuant to this clause in Cornerstone promptly upon receipt;
(iv) the Issuer may declare or make Restricted Payments to Vencor of
amounts necessary for any payment of Permitted Taxes related to the business or
assets of the Issuer and its Restricted Subsidiaries including, without
limitation, (A) any income Permitted Tax liability allocated to the Issuer and
Restricted Subsidiaries under Internal Revenue Code Sections 1502 and 1552 and
Treasury Regulations promulgated thereunder, and any equivalent provisions
allocating tax liability to them as members of a consolidated or combined tax
group for state or local tax purposes, (B) any joint and several liability for
taxes asserted against the Issuer and Restricted Subsidiaries by a Permitted
Taxing authority under Treasury Regulations Section 1.1502-6 or any equivalent
provisions of state or local tax law or (C) any liability for Permitted Taxes or
other amounts under the provisions of the Tax Refund Escrow Agreement or the Tax
Allocation Agreement; and
(v) the Issuer may declare or make Restricted Payments in cash to
Vencor if at the time of, and after giving effect to, the Restricted Payment:
(A) the Issuer could incur at least $1.00 of additional
Debt pursuant to Section 7.01(a); and
(B) the aggregate amount expended for all Restricted
Payments made pursuant to clause (ii) and this clause (v) on or after
the Closing Date would not exceed 25% of the aggregate Free Cash Flow
calculated on a cumulative basis during the period, taken as one
accounting period, beginning on the first day of the first full Fiscal
Quarter following the Closing Date and ending on the last day of the
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Issuer's most recently completed Fiscal Quarter for which financial
statements have been provided pursuant to this Agreement;
provided that Restricted Payments may be declared and made pursuant to
clauses (ii), (iii), (iv) or (v) only if at the time of, and after giving effect
to, the Restricted Payment, no Default shall have occurred and be continuing.
(b) Vencor shall not, directly or indirectly, use the proceeds of any
Restricted Payment to (i) declare or pay any dividend or other distribution on
any Equity Securities of Vencor (except dividends payable solely in Equity
Securities of the same class) or (ii) purchase, redeem, retire or otherwise
acquire any Equity Securities of Vencor except as permitted by Section
7.07(a)(ii).
Section 7.08. Limitations on Acquisitions and Investments. (a) The
Issuer shall not, and shall not permit any Restricted Subsidiary to, make any
Acquisitions or make, acquire or hold any other Investments, except:
(i) Permitted Investments;
(ii) Acquisitions involving Healthcare Facilities the sole
consideration for which consists of Qualified Equity Interests of
Vencor;
(iii) up to $7.7 million in connection with the Kingfish
Transaction; and
(iv) Investments or Acquisitions funded with any Net Cash
Proceeds of an Asset Sale or an Equity Issuance or any Casualty
Proceeds pursuant to Section 2.06; provided that in the case of an
Equity Issuance, such amounts have been transferred by Vencor to the
Issuer as an equity contribution.
(b) Notwithstanding the foregoing, the Issuer and its Restricted
Subsidiaries may make Restricted Investments involving Healthcare Facilities and
assets incidental thereto if, at the time of, and after giving effect to, each
such Restricted Investment:
(i) no Default shall have occurred and be continuing; and
(ii) the aggregate amount of such Restricted Investment and all
other Restricted Investments made in reliance on this clause (net of,
with respect to a Restricted Investment in any particular Person made
pursuant to this clause, the after-tax cash return thereon received
after the Closing Date as a result of any sale for cash, repayment,
redemption, liquidating distribution or other cash realization (not
included in Consolidated Net Income), but not to exceed the amount of
such Restricted Investment in such Person made after the Closing Date
in reliance on this clause) plus the aggregate principal amount of
related Debt incurred pursuant to Section 7.01(b)(vi) and still
outstanding (including
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any refinance thereof pursuant to Section 7.0l(b)(vii)) (such Debt,
"Investment Related Debt") does not exceed $30,000,000;
provided that if the aggregate amount of Restricted Investments
made by the Issuer and its Restricted Subsidiaries in reliance on this clause
plus the aggregate principal amount of Investment Related Debt at any time is
equal to $30,000,000 or if such threshold would be exceeded by the making of any
proposed Restricted Investment, then the Issuer and its Restricted Subsidiaries
may make additional Restricted Investments involving Healthcare Facilities and
assets incidental thereto if (x) the Issuer or the Restricted Subsidiary, as the
case may be, notifies the Administrative Agent that it proposes to make a
Restricted Investment pursuant to this proviso, which notice shall specify the
amount of such Restricted Investment and the date on which such Restricted
Investment is proposed to be made and (y) at the time of, and after giving
effect to, each such additional Restricted Investment:
(1) no Default shall have occurred and be continuing; and
(2) the aggregate amount of such additional Restricted
Investment and all other Restricted Investments made in reliance
on this proviso plus the aggregate principal amount of Investment
Related Debt does not exceed the lesser of (x) the amount of
additional Debt that the Issuer could then incur pursuant to
Section 7.01(a) and (y) $20,000,000.
Section 7.09. No Change of Fiscal Periods. Neither the Issuer nor Vencor
shall change the date on which any of its Fiscal Years or Fiscal Quarters ends,
unless the Required Lenders shall have consented to such change (which consent
may be conditioned on the amendment of any covenant herein that would be
affected by such change to eliminate the effect thereof).
Section 7.10. Limitation on Business.
(a) Vencor will at all times own 100% of the outstanding Equity Interests
of the Issuer and will not engage in any activities other than owning such
Equity Interests and Equity Interests in Cornerstone and other Subsidiaries that
own, operate or manage Healthcare Facilities, and financing activities and other
activities reasonably related to such ownership.
(b) Vencor shall not permit any of its Subsidiaries (other than the
Excluded Partnerships and Cornerstone) to engage in any business, other than the
business of owning, operating or managing Healthcare Facilities and any business
reasonably incidental thereto.
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(c) The Issuer shall not, and shall not permit any Restricted Subsidiary
to, engage in any business, other than the business of owning, operating or
managing Healthcare Facilities, any of the businesses in which the Issuer and
its Restricted Subsidiaries are engaged on the Closing Date and any business
reasonably incidental thereto.
Section 7.11. Limitation on Sale and Leaseback Transactions. The Issuer
shall not, and shall not permit any Restricted Subsidiary to, enter into any
Sale and Leaseback Transaction with respect to any property or asset unless:
(1) the Issuer or the Restricted Subsidiary would be entitled to
(A) incur Debt in an amount equal to the Attributable Debt with
respect to such Sale and Leaseback Transaction pursuant to Section
7.01(a), and
(B) create a Lien on such property or asset securing such
Attributable Debt pursuant to Section 7.02,
in which case, the corresponding Debt and Lien will be deemed incurred
pursuant to those provisions, and
(2) the Issuer complies with Section 7.03(d) in respect of such
transaction.
Section 7.12. No Modification of Certain Documents Without Consent. (a) The
Issuer shall not, Vencor shall not, and the Issuer shall not permit any
Restricted Subsidiary to, consent to or solicit any amendment or supplement to,
or any waiver or other modification of, any Existing Affiliate Agreement if the
effect thereof would be to materially increase the amount, or materially
accelerate the date of payment, of any obligation of the Issuer or any Guarantor
thereunder.
(b) The Issuer shall not, Vencor shall not, and the Issuer shall not permit
any Restricted Subsidiary to, consent to or solicit any amendment or supplement
to, or any waiver or other modification of any Third Party Lease or Management
Contract, the Tax Refund Escrow Agreement or the Tax Allocation Agreement, if
the effect thereof could reasonably be expected to be adverse in any material
respect to the Issuer and the Guarantors, taken as a whole, or to the Lenders.
(c) The Issuer shall not, Vencor shall not, and the Issuer shall not permit
any Restricted Subsidiary to, consent to or solicit any amendment or supplement
to, or any waiver or other modification of any Master Lease Agreement if the
effect thereof could adversely affect the ability of the Issuer and the
Guarantors to repay the Obligations as and when due.
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Section 7.13. Limitation on Cash Not Held in Collateral Accounts or
Concentration Accounts. The Issuer will not permit the aggregate amount of all
collected funds and Temporary Cash Investments held by the Issuer and its
Restricted Subsidiaries in accounts, other than the Collateral Accounts, the
Exit Facility Collateral Account and the Concentration Accounts, to exceed
$2,000,000 at the close of business on any two consecutive Business Days. On the
Closing Date, all cash and Temporary Cash Investments of Vencor and its
Subsidiaries held on the Closing Date will be held in the Issuer or a Restricted
Subsidiary, other than (a) amounts held in Unrestricted Subsidiaries that,
consistent with Vencor's historical cash management practices, have been held in
Unrestricted Subsidiaries, (b) up to $l,000,000 held in Vencor and (iii)
deposits with trade creditors, landlords, bonding companies and similar deposits
in the ordinary course of business consistent with past practice.
Section 7.14. Anti-Layering. The Issuer and Vencor shall not, and shall not
permit any Subsidiary Guarantor to, incur any Debt that is subordinate in right
of payment to Senior Obligations of the Issuer, Vencor or the Subsidiary
Guarantors, unless such Debt is pari passu with, or subordinated in right of
payment to, the Notes or the Guarantee under the relevant Guaranty Agreement.
This does not apply to distinctions between categories of Debt that exist by
reason of any Liens or Guarantees securing or in favor of some but not all of
such Debt.
Section 7.15. Payments for Consents. The Issuer and Vencor shall not, and
shall not permit any of their Subsidiaries or Affiliates to, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Lender for or as an inducement to any
consent, waiver or amendment of any of the terms or provisions of this Agreement
or the other Financing Documents unless such consideration is offered to be paid
or agreed to be paid to all Lenders that consent, waive or agree to amend such
term or provision within the time period set forth in the solicitation documents
relating to the consent, waiver or amendment.
ARTICLE 8
Defaults
Section 8.01. Events of Default. If one or more of the following events
(each, an "Event of Default") shall have occurred and be continuing:
(a) (i) any principal of any Note shall not be paid within three Business
Days after the due date thereof, or (ii) any interest thereon shall not be paid
within five Business Days after the due date thereof, or (iii) any fee or other
amount payable hereunder to or for the account of any Agent or any Lender shall
not be paid on the due date thereof and any such fee or other amount shall
remain unpaid for 5 Business
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Days after written notice thereof has been given to the Issuer by the
Administrative Agent, in each case, whether or not the payment is prohibited
under Section 11; or
(b) the Issuer shall fail to observe or perform any covenant contained in
Article 6; or
(c) the Issuer or Vencor shall fail to observe or perform any covenant
contained in Section 5.01(e), Section 5.01(f) or Article 7; or
(d) the Issuer or any Guarantor shall fail to observe or perform any of its
covenants or agreements contained in the Financing Documents (other than those
covered by clause (a), (b) or (c) above) for 30 days after written notice
thereof has been given to the Issuer by the Administrative Agent at the request
of any Lender; provided that: (i) if such failure relates primarily to the
operation of, or to the use, maintenance, protection, preservation or status of
property used directly in the operation of, a particular Healthcare Facility
that is a Master Lease Property and there is a representation, covenant or
agreement dealing with substantially the same subject matter in the applicable
Master Lease Agreement, such failure shall not constitute an Event of Default
pursuant to this clause (d) and instead shall be governed solely by Sections
8.01(h) and 8.01(l) below; and (ii) if such failure relates primarily to the
operation of, or to the use, maintenance, protection, preservation or status of
property used directly in the operation of, one or more Healthcare Facilities
that are subject to one or more Third Party Leases and it would not be an Event
of Default under Section 8.01(i) if at such time all such Third Party Leases
were terminated (or the surrender or repossession of the property leased
thereunder were required), such failure shall not constitute an Event of Default
pursuant to this Section 8.01(d); or
(e) any representation, warranty, certification or statement made by the
Issuer or any Guarantor in any Financing Document or in any certificate,
financial statement or other document delivered pursuant thereto shall prove to
have been incorrect in any material respect when made; or
(f) the Issuer or any Guarantor shall fail to make one or more payments in
respect of Material Debt when due or within any period of grace applicable to
such payments; or
(g) any event or condition shall occur that (i) results in the acceleration
of the maturity of any Financial Accommodation or (ii) enables the holder or
holders of such Financial Accommodation or any Person acting on behalf of such
holder or holders to accelerate the maturity thereof, and such event or
condition has not been waived or cured and the aggregate amount that would be
payable by the Issuer and the Guarantors upon the acceleration of all Financial
Accommodations referred to in clauses (i) and (ii) above equals or exceeds
$5,000,000; provided that it shall not be an Event of Default under this clause
(g) if such event or condition is an event of default under the instrument
evidencing such Financial Accommodation and arises
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with respect to an Event of Default (as defined in the applicable Master Lease
Agreement) and no other event of default shall have then occurred and be
continuing under such instrument; or
(h) the termination of the lease of one or more Healthcare Facilities under
a Master Lease Agreement, or the surrender or repossession of one or more
Healthcare Facilities leased thereunder, prior to the scheduled termination
thereof; provided that (i) this subsection (h) shall not apply to (A) any
voluntary termination of a lease of a Healthcare Facility at a time when no
Event of Default (as defined in the Master Lease Agreement) exists thereunder or
is reasonably likely to occur or (B) any termination of a lease of a Healthcare
Facility pursuant to a purchase option exercised in accordance with the terms
thereof and (ii) no Event of Default shall exist under this subsection (h) at
any time, unless the EBITDAR attributable to all Healthcare Facilities covered
by this subsection (h) then being terminated, surrendered or repossessed (the
Fiscal Quarter in which such termination, surrender or repossession occurs, the
"Current Fiscal Quarter"), and the EBITDAR attributable to all Healthcare
Facilities with respect to which such a termination, surrender or repossession
covered by this subsection (h) occurred during the Current Fiscal Quarter and
the most recently ended period of four consecutive Fiscal Quarters exceed, in
the aggregate, 5% of Consolidated EBITDAR during such four consecutive Fiscal
Quarter period (the EBITDAR attributable to each such Healthcare Facility and
the Consolidated EBITDAR to be calculated, in each case, for the most recently
ended period of four consecutive Fiscal Quarters for which the necessary
information is available, in each case annualized if such fiscal information is
not available for a full four Fiscal Quarters following the Closing Date); or
(i) one or more events or conditions shall occur that result in, or enable
the counter-party thereunder to require, (i) the termination of one or more
Third Party Leases, or the surrender or repossession of the property leased
thereunder, prior to the scheduled termination thereof or (ii) the termination
of one or more Management Contracts prior to the scheduled termination thereof;
provided that (x) this subsection (i) shall not apply to any voluntary
termination of a Third Party Lease or Management Contract by the Issuer or a
Guarantor at a time when no default by it thereunder exists or is reasonably
likely to occur and (y) no Event of Default shall exist under this subsection
(i) at any time, unless the EBITDA attributable to all Healthcare Facilities
then subject to a termination, surrender or repossession covered by this
subsection (i) and the EBITDA attributable to all Healthcare Facilities with
respect to which such a termination, surrender or repossession occurred during
the preceding 12 months exceed, in the aggregate, 12% of Consolidated EBITDA
(the EBITDA attributable to each such Healthcare Facility to be calculated for
the most recent 12 months of full operation thereof for which the necessary
financial information is available and Consolidated EBITDA to be calculated for
the most recently ended period of four consecutive Fiscal Quarters for which the
necessary financial information is available, in each case annualized if such
financial information is not available for a full 12 months or a full four
Fiscal Quarters, as the case may be); or
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(j) any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $l,000,000 which it shall have become liable to
pay under Title IV of ERISA; or notice of intent to terminate a Material Plan
shall be filed under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current payment
obligation in excess of $1,000,000; or
(k) one or more Enforceable Judgments for the payment of money aggregating
in excess of $20,000,000 shall be rendered against the Issuer or one or more of
the Guarantors and shall not have been satisfied; or
(l) any Lien created by any of the Collateral Documents shall at any time
fail to constitute a valid and perfected Lien on all of the Collateral purported
to be subject to such Lien, subject to no prior or equal Lien (other than Liens
securing amounts owing under the Exit Facility and other Permitted Liens), or
the Issuer or any Guarantor shall so assert in writing; provided that it shall
not be an Event of Default under this clause (l) if the Liens in question are
not valid or not perfected, or are subject to such other Liens, only in respect
of Collateral used directly in the operation of one or more particular
Healthcare Facilities (i) that are Master Lease Properties and the number of
such Facilities does not exceed 15 or (ii) that are subject to one or more Third
Party Leases and it would not be an Event of Default under 8.01(i) if at such
time all such Third Party Leases were terminated (or the surrender or
repossession of the property leased thereunder were required); or
(m) any provision of any Guaranty Agreement shall cease to be in full force
and effect (except as permitted by Section 7.03(b)) or any Guarantor, or any
Person acting on behalf of any Guarantor, shall so assert in writing; or
(n) other than the Chapter 11 Cases:
(i) the Issuer or any Guarantor shall commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, or shall consent to any such relief
or to the appointment of or taking possession by any such official in an
involuntary case or other
80
proceeding commenced against it, or shall make a general assignment for the
benefit of creditors, or shall fail generally to pay its debts as they
become due, or shall take any corporate action to authorize any of the
foregoing; or
(ii) an involuntary case or other proceeding shall be commenced
against the Issuer or any Guarantor seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy,
insolvency or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official of it or any substantial part of its property, and such
involuntary case or other proceeding shall remain undismissed and unstayed
for a period of 60 days; or an order for relief shall be entered against it
under the Federal bankruptcy laws as now or hereafter in effect; or
(o) any Person or group of Persons (within the meaning of Section 13 or 14
of the Securities Exchange Act) (other than any Person which acquires shares of
common stock of Vencor on the Closing Date pursuant the Plan of Reorganization
(an "Excluded Person") or any group of Persons of which Excluded Persons have
majority interest) shall have acquired beneficial ownership (within the meaning
of Rule 13d-3 promulgated by the SEC under said Act) of more than 50% of the
outstanding shares of common stock of Vencor,
then, and in every such event the Administrative Agent or the Required Lenders
may by notice to the Issuer declare the principal of the Notes and all other
amounts in respect of the Obligations (in each case together with accrued
interest thereon) to be, and they shall become due and payable upon the earlier
to occur of (x) the 5/th/ day after notice thereof has been given to the Exit
Facility Agent and (y) the date on which all Senior Obligations have been
accelerated, without presentment, demand, protest or other notice of any kind,
all of which are hereby waived by the Issuer. If any event specified above in
Section 8.01(n) occurs, then without notice to the Issuer or any other act by
any Agent or any Lender, the principal of the Notes and all other amounts in
respect of the Obligations (in each case together with accrued interest thereon)
shall become immediately due and payable without presentment, demand, protest or
notice of any kind, all of which are hereby waived by the Issuer. The
Administrative Agent will promptly notify the Exit Facility Agent of any
declaration of acceleration of the Notes.
Section 8.02. Notice of Default. The Administrative Agent shall give notice
to the Issuer under Section 8.01 promptly upon being requested to do so by the
Required Lenders and shall thereupon notify all the Lenders thereof.
Section 8.03. Enforcement Notice. Subject to the Intercreditor Agreement,
if the Administrative Agent is (i) instructed to do so by the Required Lenders
at any time after the Notes become immediately due and payable pursuant to
Section 8.01(n), or (ii) instructed to do so by the Required Lenders at any time
after the
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principal and other amounts outstanding under the Notes have been declared due
and payable pursuant to Section 8.01, the Administrative Agent shall deliver to
the Collateral Agent an Enforcement Notice directing the Collateral Agent to
exercise one or more specific remedies under the Collateral Documents or any
other right or remedy available at law or in equity. Concurrently with the
delivery of any such Enforcement Notice to the Collateral Agent, the principal
of the Notes and other amounts in respect of the Obligations not theretofore
declared due and payable shall automatically become immediately due and payable.
ARTICLE 9
The Agent
Section 9.01. Appointment and Authorization.
(a) Each Lender irrevocably appoints the Administrative Agent to act as its
agent in connection herewith and authorizes the Administrative Agent to take
such action as agent on such Lender's behalf and to exercise such powers under
the Financing Documents as are delegated to the Administrative Agent by the
terms thereof, together with all such powers as are reasonably incidental
thereto.
(b) Each of the Lenders and the Administrative Agent (i) authorizes the
Collateral Agent to execute the Collateral Documents and the Intercreditor
Agreement as agent on their behalf, (ii) irrevocably appoints and authorizes the
Collateral Agent to take such action as agent on its behalf and to exercise such
powers under the Collateral Documents and the Intercreditor Agreement as are
delegated to the Collateral Agent by the terms thereof, together with all such
powers as are reasonably incidental thereto and (iii) agrees to be bound by the
terms and provisions of the Collateral Documents and the Intercreditor Agreement
relating to the Administrative Agent and such Lender.
Section 9.02. Agents and Affiliates. Xxxxxx shall have the same rights and
powers under the Financing Documents as any other Lender and may exercise or
refrain from exercising the same as though it were not one of the Agents. Xxxxxx
and its affiliates may accept deposits from, lend money to, and generally engage
in any kind of business with the Issuer or any of the Guarantors or their
Affiliates as if it were not one of the Agents.
Section 9.03. Actions by Agents. The obligations of each of the Agents
under the Financing Documents are only those expressly set forth therein with
respect to it. Without limiting the generality of the foregoing, none of the
Agents shall be required to take any action with respect to any Default, except
as expressly provided in Article 8 hereof and in the Collateral Documents.
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Section 9.04. Consultation with Experts. Each of the Agents may consult
with legal counsel (who may be counsel for the Issuer or any Guarantor),
independent public accountants and other experts selected by it and shall not be
liable for any action taken or omitted to be taken by it in good faith in
accordance with the advice of such counsel, accountants or experts.
Section 9.05. Liability of Agents. None of the Agents or their respective
affiliates or their respective directors, officers, agents or employees shall be
liable for any action taken or not taken by it in connection with the Financing
Documents (i) with the consent or at the request of the Required Lenders or (ii)
in the absence of its own gross negligence or willful misconduct. None of the
Agents or their respective affiliates or their respective directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with any Financing Document; (ii) the performance or observance of
any of the covenants or agreements of the Issuer or any Guarantor under any
Financing Document; (iii) the satisfaction of any condition specified in Section
3.01 except, in the case of the Administrative Agent, receipt of items required
to be delivered to it; (iv) the validity, effectiveness or genuineness of any
Financing Document or any other instrument or writing furnished in connection
therewith; or (v) the existence, genuineness or value of any of the Collateral
or the validity, perfection, recordation, priority or enforceability of any Lien
on any of the Collateral. None of the Agents shall incur any liability by acting
in reliance upon any notice, consent, certificate, statement, or other writing
(which may be a bank wire, telex, facsimile copy or similar writing) believed by
it to be genuine or to be signed by the proper party or parties.
Section 9.06. Indemnification. The Lenders shall, ratably in accordance
with the aggregate outstanding principal amount of their Loans, indemnify each
Agent, their respective affiliates and their respective directors, officers,
agents and employees (to the extent not reimbursed by the Issuer and the
Guarantors) against any cost, expense (including reasonable counsel fees and
disbursements), claim, demand, action, loss or liability (except such as result
from such indemnitee's gross negligence or willful misconduct) that such
indemnitee may suffer or incur in connection with the Financing Documents or any
action taken or omitted by such indemnitees thereunder.
Section 9.07. Credit Decision. Each Lender acknowledges that it has,
independently and without reliance on the Agents or any other Lender, and based
on such documents and information as it has deemed appropriate, made its own
credit analysis and decision to enter into this Agreement. Each Lender also
acknowledges that it will, independently and without reliance upon the Agents or
any other Lender, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking any action under the Financing Documents.
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Section 9.08. Successor Agents. (a) Any Agent may resign at any time (a
"Retiring Agent") by giving notice thereof to the Lenders, the other Agents and
the Issuer. Upon any such resignation, the Required Lenders shall have the right
to appoint a successor for the Retiring Agent (a "Successor Agent"). If no
Successor Agent shall have been so appointed by the Required Lenders, and shall
have accepted such appointment, within 30 days after the Retiring Agent gives
notice of resignation, then the Retiring Agent may, on behalf of the Lenders,
appoint a Successor Agent, which shall be a Lender or any other commercial bank
organized or licensed under the laws of the United States or any State thereof
and having a combined capital and surplus of at least $500,000,000; provided
that for so long as Xxxxxx is the Exit Facility Agent, Xxxxxx shall have the
absolute right to resign as Administrative Agent upon 30 days notice, and such
resignation shall become effective, regardless of whether a Successor Agent has
been appointed and shall have no obligation to appoint a Successor Agent. Upon
the acceptance of its appointment as a Successor Agent, such Successor Agent
shall thereupon succeed to and become vested with all the rights and duties of
the Retiring Agent, and the Retiring Agent shall be discharged from its duties
and obligations hereunder; provided that if Xxxxxx resigns as Administrative
Agent pursuant to the proviso in the previous sentence, then Xxxxxx shall be
discharged from its duties and obligations hereunder immediately upon the expiry
of the 30 day period referred to in such proviso. After any Retiring Agent
resigns as an Agent hereunder, the provisions of this Article 9 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
one of the Agents.
(b) Without prejudice to its rights under paragraph (a), Xxxxxx may resign
as an Agent at any time and may appoint any other subsidiary of X.X. Xxxxxx
Chase & Co. to such role by giving written notice thereof to each of the Lenders
and the Issuer. Upon such appointment, such subsidiary shall thereupon succeed
to and become vested with all the rights and duties of Xxxxxx in such capacity
and Xxxxxx shall be discharged from its duties and obligations in such capacity
hereunder. After Xxxxxx resigns as Agent under this paragraph (b), the
provisions of this Article 9 shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was one of the Agents.
Section 9.09. Collateral Agent.
(a) As to any matters not expressly provided for in the Collateral
Documents (including the timing and methods of realization upon the Collateral),
the Collateral Agent shall, subject to the Intercreditor Agreement, act or
refrain from acting in accordance with written instructions from the Required
Lenders or, in the absence of such instructions, in accordance with its
discretion; provided that the Collateral Agent shall not be obligated to take
any action if the Collateral Agent believes that such action is or may be
contrary to any applicable law or might cause the Collateral Agent to incur any
loss or liability for which it has not been indemnified to its satisfaction.
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(b) The Collateral Agent shall not be responsible for the existence,
genuineness or value of any of the Collateral or for the validity, perfection,
priority or enforceability of any Lien on any of the Collateral, whether
impaired by operation of law or by reasons of any action or omission to act on
its part under the Collateral Documents. The Collateral Agent shall have no duty
to ascertain or inquire as to the performance or observance of any of the terms
of the Collateral Documents by the Issuer or any of the Guarantors.
ARTICLE 10
Changes in Circumstances
SectioN 10.01. Increased Cost and Reduced Return.
(a) If, on or after the date hereof, the adoption of any applicable law,
rule or regulation, or any change in any applicable law, rule or regulation, or
any change in the interpretation or administration thereof by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender Party (other than the
Agents) with any request or directive (whether or not having the force of law)
of any such authority, central bank or comparable agency, shall impose, modify
or deem applicable any reserve, special deposit, insurance assessment or similar
requirement (including any such requirement imposed by the Board of Governors of
the Federal Reserve System) against assets of, deposits with or for the account
of, or credit extended by, any Lender Party (other than the Agents) or shall
impose on any Lender Party (other than the Agents) or the London interbank
market any other condition affecting its Loans, and the result of any of the
foregoing is to increase the cost to such Lender Party of making or maintaining
its Loans or to reduce the amount of any sum received or receivable by such
Lender Party under this Agreement or under its Loans with respect thereto, by an
amount deemed by such Lender Party to be material, then, within 15 days after
demand by such Lender Party (with a copy to the Administrative Agent), the
Issuer shall pay to such Lender Party such additional amount or amounts as will
compensate such Lender Party for such increased cost or reduction; provided that
the Issuer shall not be liable to any Lender Party in respect of any such
increased cost or reduction with respect to any period of time more than three
months before the Issuer receives the notice required by the first sentence of
Section 10.01(c) or more than six months before the Issuer receives the relevant
certificate referred to in the second sentence of Section 10.01(c).
(b) If any Lender Party (other than the Agents) shall have determined that,
after the date hereof, the adoption of any applicable law, rule or regulation
regarding capital adequacy, or any change in any such law, rule or regulation,
or any change in the interpretation or administration thereof by any
governmental authority, central
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bank or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such authority, central bank or comparable
agency, has or would have the effect of reducing the rate of return on capital
of such Lender Party (or its Parent) as a consequence of such Lender Party's
obligations hereunder to a level below that which such Lender Party (or its
Parent) could have achieved but for such adoption, change, request or directive
(taking into consideration its policies with respect to capital adequacy) by an
amount deemed by such Lender Party to be material, then from time to time,
within 15 days after demand by such Lender Party (with a copy to the
Administrative Agent), the Issuer shall pay to such Lender Party such additional
amount or amounts as will compensate it for such reduction; provided that the
Issuer shall not be liable to any Lender Party in respect of any such reduction
with respect to any period of time more than three months prior to the date of
the notice required by the first sentence of Section 10.01(c).
(c) Each Lender Party (other than the Agents) will promptly notify the
Issuer and the Administrative Agent of any event of which it has knowledge,
occurring after the date hereof, which will entitle it to compensation pursuant
to this Section and will designate a different Lending Office if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the judgment of such Lender Party, be otherwise disadvantageous
to it. A certificate of any such Lender Party claiming compensation under this
Section and setting forth the additional amount or amounts to be paid to it
hereunder, showing the calculation thereof in reasonable detail, shall be
conclusive in the absence of manifest error. In determining such amount, such
Lender Party may use any reasonable averaging and attribution methods.
Section 10.02. Taxes.
(a) Any and all payments by the Issuer and the Guarantors to or for the
account of any Lender Party under any Financing Document shall be made free and
clear of and without deduction for any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender Party, taxes imposed on its net
income, and franchise or similar taxes imposed on it, by (i) the jurisdiction
under the laws of which it is organized or any political subdivision thereof and
(ii) in the case of each Lender, the jurisdiction of its Lending Office or any
political subdivision thereof (all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings and liabilities being hereinafter
referred to as "Taxes"). If the Issuer or any Guarantor shall be required by law
to deduct any Taxes from or in respect of any sum payable under any Financing
Document to any Lender Party, (i) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 10.02) such Lender
Party receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Issuer or the relevant Guarantor shall make such
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deductions, (iii) the Issuer or the relevant Guarantor shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law, and (iv) the Issuer or the relevant Guarantor shall furnish
to the Administrative Agent, at its address specified in or pursuant to Section
12.01, the original or a certified copy of a receipt evidencing payment thereof.
(b) In addition, the Issuer agrees to pay any present or future stamp or
documentary taxes or any other excise or property taxes, or charges or similar
levies which arise from any payment made hereunder or under any other Financing
Document or from the execution or delivery of, or otherwise with respect to, any
Financing Document (hereinafter referred to as "Other Taxes").
(c) The Issuer agrees to indemnify each Lender Party for the full amount
of Taxes or Other Taxes (including any Taxes or Other Taxes imposed or asserted
by any jurisdiction on amounts payable under this Section 10.02) paid by such
Lender Party and any liability (including penalties, interest and expenses)
arising therefrom or with respect thereto. This indemnification shall be made
within 15 days from the date such Lender Party makes demand therefor.
(d) Each Lender Party organized under the laws of a jurisdiction outside
the United States, on or prior to the date of its execution and delivery of this
Agreement in the case of each Lender Party listed on the signature pages hereof
and on or prior to the date on which it becomes a Lender Party in the case of
each other Lender Party, and from time to time thereafter if requested in
writing by the Issuer (but only so long as such Lender Party remains lawfully
able to do so), shall provide the Issuer and the Administrative Agent with (i)
Internal Revenue Service form W-8BEN, or any successor form prescribed by the
Internal Revenue Service, certifying that such Lender Party is entitled to
benefits under an income tax treaty to which the United States is a party which
reduces the rate of withholding tax on payments of interest under the Financing
Documents or (ii) an Internal Revenue Service form W-8ECI, or any successor form
prescribed by the Internal Revenue Service, certifying that the income
receivable by it pursuant to this Agreement is effectively connected with the
conduct of a trade or business in the United States. If the form provided by a
Lender Party at the time such Lender Party first becomes a party to this
Agreement indicates a United States interest withholding tax rate in excess of
zero, withholding tax at such rate shall be excluded from "Taxes" as defined in
Section 10.02(a).
(e) For any period with respect to which a Lender Party has failed to
provide the Issuer and the Administrative Agent with the appropriate form
pursuant to Section 10.02(d) (unless such failure is due to a change in treaty,
law or regulation occurring subsequent to the date on which a form originally
was required to be provided), such Lender Party shall not be entitled to
indemnification under Section 10.02(a) with respect to Taxes imposed by the
United States; provided that should a Lender Party, which is otherwise exempt
from or subject to a reduced rate of withholding tax, become subject to Taxes
because of its failure to deliver a form required hereunder,
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the Issuer or the relevant Guarantor shall take such steps as such Lender Party
shall reasonably request to assist such Lender Party to recover such Taxes.
(f) If the Issuer or any Guarantor is required to pay additional amounts
to or for the account of any Lender Party pursuant to this Section 10.02, then
such Lender Party will change the jurisdiction of its Lending Office so as to
eliminate or reduce any such additional payment which may thereafter accrue if
such change, in the sole judgment of such Lender Party, is not otherwise
disadvantageous to such Lender Party.
(g) Without prejudice to the survival of any other agreement of the Issuer
or Vencor hereunder, the agreements and obligations of the Issuer and the
Guarantors contained in this Section 10.02 (as set forth herein and incorporated
by reference in the Guaranty Agreements) shall survive the payment in full of
the principal of and interest on the Notes.
ARTICLE 11
Subordination
Section 11.01. Agreement to Subordinate. The Debt evidenced by the Notes,
together with all interest, fees, indemnities, rescission claims and other
Obligations hereunder and under the Financing Documents, is subordinated in
right of payment, to the extent and in the manner provided in this Agreement, to
the prior payment of all Senior Obligations. The subordination provisions are
for the benefit of and enforceable by the holders of Senior Obligations from
time to time.
Section 11.02. Liquidation, Dissolution, Bankruptcy. Upon any payment or
distribution of the assets of the Issuer to creditors upon a total or partial
liquidation or a total or partial dissolution of the Issuer or in a bankruptcy,
reorganization, insolvency, receivership or similar proceeding relating to the
Issuer or its property:
(a) holders of Senior Obligations are entitled to receive payment in full
in cash of all Senior Obligations, including all interest accrued or accruing on
Senior Obligations after the commencement of any bankruptcy, insolvency or
reorganization or similar case or proceeding at the contract rate (including,
without limitation, any contract rate applicable upon default) specified in the
relevant documentation, whether or not the claim for the interest is allowed as
a claim in the case or proceeding with respect to the Senior Obligations before
the Lenders will be entitled to receive any payment of principal of or interest
on the Notes. As used herein, "payment in full" or "paid in full" shall mean,
with respect to the Senior Obligations, the indefeasible payment in full in cash
or cash equivalents of 100% of the principal, interest, fees, expenses and other
amounts due or to become due to the Senior Agents and the Senior Lenders under
the Exit Facility and the other Exit Facility Financing Documents in the manner
provided under the terms of such
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documents or in such other manner which the Exit Facility Agent, at the
direction of the Senior Lenders, shall have consented in writing; and
(b) until the Senior Obligations are paid in full, any payment or
distribution to which Lenders would be entitled but for these subordination
provisions shall instead be made to holders of Senior Obligations as their
interests may appear.
Section 11.03. Default on Senior Obligations. (a) The Issuer shall not pay
the principal of or interest on the Notes, or any other Obligation hereunder and
under the Financing Documents, and shall not repay, repurchase, redeem or
otherwise retire any Notes (collectively hereinafter referred to as "pay the
Notes") if at the time any Senior Obligations have not been paid when due,
whether at maturity, upon redemption or mandatory repurchase, acceleration, or
otherwise, and the default has not been cured or waived.
(b) During the continuance of any default (other than a default of the
type specified in clause (a)) with respect to any Senior Obligations pursuant to
which the maturity thereof may be accelerated immediately without further notice
(except any notice that may be required to effect acceleration) or upon the
expiration of a grace period, the Issuer may not pay the Notes for a period (a
"Payment Blockage Period"):
(i) commencing upon the receipt by the Issuer and the
Administrative Agent (if it is not the same person as the Exit Facility
Agent) of written notice of default from the Exit Facility Agent specifying
an election to effect a Payment Blockage Period (a "Blockage Notice") and
(ii) ending 179 days thereafter (or earlier if the Payment Blockage
Period is terminated (A) by written notice to the Administrative Agent (if
it is not the same person as the Exit Facility Agent) and the Issuer from
the Exit Facility Agent, (B) by repayment in full of such Senior
Obligations or (C) because the default giving rise to the Blockage Notice
has been cured or waived pursuant to a writing satisfactory to the Exit
Facility Agent).
Subject to clause (a) and the preceding paragraph, unless the holders of
such Senior Obligations have accelerated the maturity of such Senior
Obligations, the Issuer may resume payments on the Notes after the Payment
Blockage Period.
(c) Not more than one Blockage Notice may be given in any consecutive 360-
day period, irrespective of the number of defaults with respect to Senior
Obligations during such period. No default which existed or was continuing on
the date of the commencement of any Payment Blockage Period with respect to the
Senior Obligations whose holders initiated the Payment Blockage Period may be
made the basis of the commencement of a subsequent Payment Blockage Period by
the holders of such Senior Obligations, whether or not within a period of 360
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consecutive days, unless the default has been cured or waived for a period of
not less than 90 consecutive days.
Section 11.04. When Distribution Must Be Paid Over. If a payment or other
distribution is made to Lenders that because of these subordination provisions
should not have been made to them, the Lenders that receive the distribution
shall hold it in trust for holders of Senior Obligations and pay it over to them
as their interests may appear.
Section 11.05. Subrogation. A distribution made under these subordination
provisions to holders of Senior Obligations which otherwise would have been made
to Lenders is not, as between the Issuer and Lenders, a payment by the Issuer on
Senior Obligations. After all Senior Obligations are paid in full and until the
Notes are paid in full, Lenders will be subrogated to the rights of holders of
Senior Obligations to receive payments in respect of Senior Obligations, which,
to the extent received by Lenders, do not constitute, as between the Issuer and
the Lenders, payments by the Issuer on the Notes.
Section 11.06. Relative Rights; Subordination Not to Prevent Events of
Default or Limit Right to Accelerate. Subject to the Intercreditor Agreement,
these subordination provisions define the relative rights of Lenders and holders
of Senior Obligations and do not impair, as between the Issuer and Lenders, the
obligation of the Issuer, which is absolute and unconditional, to pay principal
of and interest on the Notes in accordance with their terms. The failure to make
a payment pursuant to the Notes by reason of these subordination provisions does
not prevent the occurrence of a Default, nor do these subordination provisions
have any effect on the right of the Lenders or the Administrative Agent to
accelerate the maturity of the Notes upon an Event of Default or prevent the
Administrative Agent or any Lender from exercising its available remedies upon a
Default, subject to the Intercreditor Agreement and the rights of holders of
Senior Obligations to receive distributions otherwise payable to Lenders.
Section 11.07. Subordination May Not Be Impaired by Issuer. No right of
any holder of Senior Obligations to enforce the subordination of the Notes will
be impaired by any act or failure to act by the Issuer or by its failure to
comply with this Agreement.
Section 11.08. Rights Of Administrative Agent. (a) The Administrative
Agent may continue to make payments on the Notes and will not be charged with
knowledge of the existence of facts that would prohibit the making of any such
payments unless, not less than two Business Days prior to the date of such
payment, the Administrative Agent receives notice satisfactory to it from the
Issuer or the Exit Facility Agent that payments may not be made under this
Article; provided that a Blockage Notice shall be deemed to be effective as
against the Lenders immediately upon the Administrative Agent receiving such
notice under Section 11.03(b).
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(b) The Administrative Agent in its individual or any other capacity may
hold Senior Obligations with the same rights, including rights under this
Article, it would have if it were not Administrative Agent. Nothing in this
Article applies to claims of, or payments to, the Administrative Agent under or
pursuant to Section 12.03.
Section 11.09. Distributions and Notices to, and Notices and Consents by,
Representatives of Holders of Senior Obligations. Whenever a distribution is to
be made or a notice given to holders of Senior Obligations, the distribution may
be made and the notice given to the Exit Facility Agent. Notices or consents
under this Agreement from holders of the Senior Obligations may be given only by
the Exit Facility Agent.
Section 11.10. Administrative Agent Entitled to Rely. For the purpose of
ascertaining the outstanding amount of Senior Obligations, the holders thereof,
and all other information relevant to making any payment or distribution to
holders of Senior Obligations pursuant to this Article, the Administrative Agent
and the Lenders are entitled to rely upon an order or decree of a court of
competent jurisdiction in which any proceedings of the nature referred to in
Section 11.02 are pending, a certificate of the liquidating trustee or other
Person making a payment or distribution to the Administrative Agent or to the
Lenders, or information provided by the Exit Facility Agent. The Administrative
Agent may defer any payment or distribution pending receipt of evidence or
instructions satisfactory to it or a judicial determination regarding the rights
of parties to receive the payment or distribution.
Section 11.11. Administrative Agent to Effectuate Subordination. Each
Lender by accepting a Note authorizes and directs the Administrative Agent on
behalf of the Lender to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination between the Lenders and the holders
of Senior Obligations as provided in this Article and appoints the
Administrative Agent as attorney-in-fact for any and all such purposes,
including for the purpose of filing a claim in any proceedings of the nature
referred to in Section 11.02.
Section 11.12. Administrative Agent Not Fiduciary for Holders of Senior
Obligations. The Administrative Agent will not be deemed to owe any fiduciary
duty to the holders of Senior Obligations and will not be liable to any such
holders if it mistakenly pays over or distribute to Lenders, or to the Issuer or
any other Person, any money or assets to which holders of Senior Obligations are
entitled by virtue of this Article.
Section 11.13. Legend on Notes. Until such time as all outstanding Senior
Obligations are indefeasibly paid in full in cash, each of the Notes and any
other promissory note or similar document evidencing the Loans, shall bear upon
its face a legend as follows:
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"THIS NOTE AND THE INDEBTEDNESS EVIDENCED HEREBY ARE SUBORDINATE IN THE
MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN CREDIT AGREEMENT
REFERRED TO BELOW IN ACCORDANCE WITH THE TERMS THEREOF, AND THE RIGHTS
AND REMEDIES OF THE HOLDER OF THIS NOTE ARE SUBJECT TO THE TERMS AND
CONDITIONS OF THAT CERTAIN SUBORDINATION AND INTERCREDITOR AGREEMENT
DATED AS OF APRIL 20,200l BY AND AMONG THE ISSUER, VENCOR, THE
COLLATERAL AGENT AND THE EXIT FACILITY COLLATERAL AGENT, AS AMENDED,
RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME (THE
"INTERCREDITOR AGREEMENT")."
Section 11.14. Reliance by Holders of Senior Obligations on Subordination
Provisions; No Waiver. (a) Each Lender by accepting a Note acknowledges and
agrees that these subordination provisions are, and are intended to be, an
inducement and a consideration to each holder of Senior Obligations, whether
created or acquired before or after the issuance of the Notes, to acquire or to
hold such Senior Obligations, and each holder of Senior Obligations will be
deemed conclusively to have relied on these subordination provisions in
acquiring and holding such Senior Obligations.
(b) The holders of Senior Obligations may, at any time and from time to
time, without the consent of or notice to the Administrative Agent or the
Lenders, without incurring any liability or responsibility to the Lenders, and
without impairing the rights of holders of Senior Obligations under these
subordination provisions, do any of the following:
(i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, Senior Obligations or any instrument
evidencing the same or any agreement under which Senior Obligations is
outstanding or secured;
(ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Obligations;
(iii) release any Person liable in any manner for the payment of
Senior Obligations; or
(iv) exercise or refrain from exercising any rights against the
Issuer and any other Person.
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ARTICLE 12
Miscellaneous
Section 12.01. Notices. Unless otherwise specified herein, all notices,
requests and other communications to any party under any Financing Document
shall be in writing (including bank wire, facsimile copy or similar writing) and
shall be given to such party at its address or facsimile number set forth on the
signature pages hereof (or, in the case of any Lender, in its Administrative
Questionnaire) or such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the Agents and the Issuer;
provided that if the Issuer or the Administrative Agent gives any notice
changing its address or facsimilie number, a copy of such notice shall be given
by the Issuer or the Administrative Agent, as the case may be, to the Exit
Facility Agent. Each such notice, request or other communication shall be
effective (i) if given by facsimile transmission, when transmitted to the
facsimile number specified in or pursuant to this Section 12.01 and confirmation
of receipt is received, (ii) if given by mail, ten days after such communication
is deposited in the mails with first class postage prepaid, addressed as
aforesaid, or (iii) if given by any other means, when delivered at the address
specified in or pursuant to this Section 12.01, provided that notices and
requests to the Administrative Agent under Articles 2, 8, 10 or 11 shall not be
effective until received.
Section 12.02. No Waiver. No failure or delay by the Lender Parties, or
any of them, in exercising any right, power or privilege under any Financing
Document shall operate as a waiver thereof nor shall any single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. The rights and remedies provided in the
Financing Documents shall be cumulative and not exclusive of any rights or
remedies provided by law.
Section 12.03. Expenses; Indemnification.
(a) The Issuer shall pay on demand all the actual and reasonable costs,
fees and expenses of(i) the Agents in connection with the negotiation,
preparation, execution and administration of the Financing Documents and any
consents, amendments, waivers or other modifications thereto, or any Default or
alleged Default hereunder; (ii) furnishing all opinions by counsel for the
Issuer and the Guarantors (including any opinions reasonably requested by the
Administrative Agent or Required Lenders as to any legal matters arising
hereunder) and of the Issuer's and the Guarantors' performance of and compliance
with all agreements and conditions on its part to be performed or complied with
under this Agreement and the other Financing Documents, including with respect
to confirming compliance with environmental, insurance and solvency
requirements; (iii) counsel to the Agents (including the reasonable fees and
expenses of O'Melveny & Xxxxx LLP and Xxxxx Xxxx & Xxxxxxxx, special counsel to
the Agents) in connection with the negotiation,
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preparation, execution and administration of the Financing Documents and any
consents, amendments, waivers or other modifications thereto and any other
documents or matters requested by the Issuer or any Guarantor, provided that it
is acknowledged that the Agents have retained O'Melveny & Xxxxx LLP principally
in respect of Bankruptcy Code matters and that after the Closing Date, in the
absence of an Event of Default, there will be only one principal counsel (as
opposed to any local counsel or similar specialized retention) retained by the
Agents, (iv) creating and perfecting Liens in favor of the Collateral Agent on
behalf of Lenders pursuant to any Collateral Document, including filing and
recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel providing any opinions that any Agent or Required Lenders may reasonably
request in respect of the Collateral Documents or the Liens created pursuant
thereto; (v) Xxxxxxxx & Xxxxx in connection with the negotiation, preparation
and execution of the Financing Documents and for a period of six months after
the Closing Date in connection with the administration thereof; (vi) the Agents
in connection with the custody or preservation of any of the Collateral; and
(vii) if any Event of Default occurs, any Lender Party, including actual and
reasonable costs, fees and expenses of counsel, in connection with such Event of
Default and collection, bankruptcy, insolvency and other enforcement proceedings
resulting therefrom, including the negotiation of any restructuring or "workout"
of the Issuer's obligations under the Financing Documents.
(b) In addition to the payment of expenses pursuant to Section 12.03(a),
whether or not the transactions contemplated hereby shall be consummated, the
Issuer agrees to defend (subject to Indemnitee's selection of counsel),
indemnify, pay and hold harmless Agents and Lenders, and the officers,
directors, employees, agents and affiliates of the Agents and Lenders
(collectively called the "Indemnitees"), from and against any and all
Indemnified Liabilities (as hereinafter defined); provided, that the Issuer
shall not have any obligation to any Indemnitee hereunder with respect to any
Indemnified Liabilities to the extent such Indemnified Liabilities arise from
the gross negligence or willful misconduct of that Indemnitee as determined by a
court of competent jurisdiction.
As used herein, "Indemnified Liabilities" means, collectively, any and all
liabilities, obligations, losses, damages (including natural resource damages),
penalties, actions, judgments, suits, claims (including environmental claims),
costs (including the costs of any investigation, study, sampling, testing,
abatement, clean-up, removal, remediation or other response action necessary to
remove, remediate, clean up or xxxxx any hazardous materials activity), expenses
and disbursements of any kind or nature whatsoever (including the reasonable
fees and disbursements of counsel for Indemnitees in connection with any
investigative, administrative or judicial proceeding commenced or threatened by
any Person, whether or not any such Indemnitee shall be designated as a party or
a potential party thereto, and any fees or expenses incurred by Indemnitees in
enforcing this indemnity), whether direct, indirect or consequential and whether
based on any federal, state or foreign laws,
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statues, rules or regulations (including securities and commercial laws,
statutes, rules or regulations and environmental laws), on common law or
equitable cause or on contract or otherwise, that may be imposed on, incurred
by, or asserted against any such Indemnitee, in any manner relating to or
arising out of(i) this Agreement or the other Financing Documents or the
transactions contemplated hereby or thereby, including any enforcement of any of
the Financing Documents (including any sale of, collection from, or other
realization upon any of the Collateral or the enforcement of the Guaranty
Agreements), or (ii) any environmental claim or any hazardous materials activity
relating to or arising from, directly or indirectly, any past or present
activity, operation, land ownership, or practice of the Issuer and the
Guarantors.
To the extent that the undertakings to defend, indemnify, pay and hold
harmless set forth in this Section 12.03(b) may be unenforceable in whole or in
part because they are violative of any law or public policy, the Issuer shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them. Without prejudice to the survival of any
other agreement of the Issuer or the Guarantors hereunder, the agreements and
obligations of the Issuer and the Guarantors contained in this Section 12.03 (as
set forth herein and incorporated by reference in the Guaranty Agreements) shall
survive the payment in full of the principal of and interest on the Notes.
Section 12.04. Sharing of Set-offs.
(a) Each Lender agrees that if it shall, by exercising any right of set-
off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest then due (or overdue) with respect to
the Notes held by it which is greater than the proportion received by any other
Lender in respect of the aggregate amount of principal and interest then due (or
overdue) with respect to the Notes held by such other Lender, the Lender
receiving such proportionately greater payment shall purchase such
participations in the Notes held by the other Lenders, and such other
adjustments shall be made, as may be required so that all such payments of
principal and interest with respect to the Notes held by the Lenders shall be
shared by the Lenders pro rata.
(b) Nothing in this Section 12.04 shall impair the right of any Lender to
exercise any right of set-off or counterclaim it may have and to apply the
amount subject to such exercise to the payment of indebtedness of the Issuer or
the relevant Guarantor other than its indebtedness in respect of the Notes.
(c) The Issuer agrees, to the fullest extent it may effectively do so
under applicable law, that any holder of a participation in a Note, whether or
not acquired pursuant to the foregoing arrangements, may exercise rights of set-
off or counterclaim and other rights with respect to such participation as fully
as if such holder of a participation were a direct creditor of the Issuer in the
amount of such participation.
95
Section 12.05. Amendments and Waivers.
(a) Neither this Agreement nor any other Financing Document, nor any terms
hereof or thereof, may be amended, supplemented or modified except in accordance
with the provisions of this Section 12.05.
(b) Except as set forth in the succeeding subsections of this Section, the
Required Lenders (or the Administrative Agent with their written consent) may
from time to time (i) enter into written amendments, supplements or
modifications of any Financing Document (which shall not be effective unless
signed by the Issuer if a party thereto and each Guarantor party thereto) for
the purpose of adding any provisions to such Financing Document or changing in
any manner the rights of the parties hereunder or thereunder or (ii) waive, on
such terms and conditions as the Required Lenders (or the Administrative Agent
with their written consent) may specify in such instrument, any of the
requirements of any Financing Document (including any waiver of any of the
conditions precedent set forth in Section 3.01 (except that the acceptance of a
Note by any Lender on the Closing Date shall be deemed to constitute a waiver of
such conditions precedent by such Lender)) or any Default or Event of Default
and its consequences (any such amendment, supplement, modification or waiver, a
"Specified Change"); provided that
(1) without the written consent of the then Agents, no Specified
Change shall amend, modify or waive any provision of Article 9 or any other
provision of this Agreement governing the rights or obligations of the
Agents; and
(2) without the written consent of all the Lenders, no Specified
Change shall reduce the percentage specified in the definition of "Required
Lenders".
(c) Without the written consent of the all Lenders, no Specified Change
shall take any action which has the effect of releasing all or substantially all
of the Collateral, releasing Vencor from its obligations under the Vencor
Guaranty Agreement or releasing all or substantially all of the Restricted
Subsidiaries from their obligations under the Subsidiary Guaranty Agreement,
except in each case as expressly provided in this Agreement or any Collateral
Document.
(d) Without the written consent of all the Lenders, no Specified Change
shall (i) consent to the assignment or transfer by Vencor or the Issuer of any
of its rights and obligations under the Financing Documents, (ii) include, as
indebtedness under this Agreement, any indebtedness of the Issuer or the
Guarantors other than the Issuer's indebtedness under the Loans or (iii) change
the priority claim status of the Obligations.
96
(e) Without the written consent of each Lender directly affected thereby,
no Specified Change shall reduce the amount or extend the scheduled date of
maturity of any Loan, or reduce the stated rate of any interest or fee payable
hereunder or extend the scheduled date of any payment thereof or amend, modify
or waive any provision of this subsection (f).
(f) Without the consent of the Exit Facility Agent, no Specified Change
may effect any change that adversely affects the rights of any holder of Senior
Obligations then outstanding under Section 11.
(g) Any such waiver and any such amendment, supplement or modification
shall apply equally to each of the Lenders and shall be binding upon the
Lenders, the Agents, all future holders of the Notes, the Issuer and the
Guarantors.
Section 12.06. Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns,
except that neither the Issuer nor Vencor may assign or otherwise transfer any
of its rights under this Agreement without the prior written consent of all the
Lenders. Any attempted assignment or transfer in contravention of the foregoing
shall be null and void.
(b) Any Lender may at any time grant to one or more banks or other
institutions (each a "Participant") participating interests in any or all of its
Loans. If any Lender grants a participating interest to a Participant, whether
or not upon notice to the Issuer and the Agents, such Lender shall remain
responsible for the performance of its obligations hereunder, and the Issuer and
the Agents shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under the Financing
Documents. Any agreement pursuant to which any Lender may grant such a
participating interest shall provide that such Lender shall retain the sole
right and responsibility to enforce the obligations of the Issuer and the
Guarantors or any other party under the Financing Documents, including the right
to approve any amendment, modification or waiver of any provision of the
Financing Documents; provided that such participation agreement may provide that
(i) such Lender will not agree to any modification, amendment or waiver of this
Agreement described in Section 10.02(f) without the consent of the Participant
and (ii) such Lender will agree to vote the Participant's participating interest
with respect to any matter requiring a vote of all Lenders under the Security
Agreement as the Participant may direct. The Issuer and Vencor each agrees that
each Participant shall, to the extent provided in its participation agreement,
be entitled to the benefits of Article 10 with respect to its participating
interest. An assignment or other transfer which is not permitted by Section
12.06(c) or 12.06(d) shall be given effect for purposes of this Agreement only
to the extent of a participating interest granted in accordance with this
subsection (b).
97
(c) Any Lender may at any time on or after the Closing Date assign to one
or more (x) Eligible Assignees or (y) affiliates or Related Funds of such
transferor Lender (each such Eligible Assignee, affiliate or Related Fund being
an "Assignee") all, or a ratable portion of all, of its rights and obligations
under the Financing Documents and the Loans, and such Assignee shall assume such
rights and obligations, with notice to the Issuer and the Administrative Agent;
provided that:
(i) any assignment of only a ratable portion of the transferor
Lender's rights and obligations shall not be less than $5,000,000;
(ii) such assignment may be made to an Assignee that is already a
Lender, or made by a Lender to one of its Related Funds, without regard to
the foregoing minimum assignment amount;
(iii) except in the case of an assignment made pursuant to clause
(ii), the Administrative Agent shall give its prior written consent to such
assignment (which consent shall not be unreasonably withheld);
(iv) the parties to each such assignment shall execute and
deliver to the Administrative Agent an Assignment Agreement for its
acceptance and recording in the Register at least two Business Days prior
to the proposed effective date of such assignment; and
(v) the Assignee under each such assignment (unless it is
already a Lender) shall deliver to the Administrative Agent a completed
Administrative Questionnaire.
When (A) such an Assignment Agreement (together with an Administrative
Questionnaire, if required) has been delivered to the Administrative Agent, (B)
such assignment has been recorded in the Register, and (C) such Assignee has
paid to such transferor Lender an amount equal to the purchase price agreed
between them, such Assignee shall be a Lender party to this Agreement and shall
have all the rights and obligations of a Lender with outstanding Notes as set
forth in such instrument of assignment, and the transferor Lender shall be
released from its obligations hereunder to a corresponding extent, and no
further consent or action by any party shall be required. Upon the consummation
of any assignment pursuant to this subsection (c), (x) the Administrative Agent
shall notify the Collateral Agent thereof and (y) the transferor Lender, the
Administrative Agent and the Issuer shall make appropriate arrangements so that,
if required, a new Note complying with the provisions of Section 2.01 is issued
to the Assignee. In connection with any such assignment, the transferor Lender
shall pay to the Administrative Agent an administrative fee for processing such
assignment in the amount of $3,500. If the Assignee is organized under the laws
of a jurisdiction outside the United States, it shall deliver to the Issuer and
the Administrative Agent certification as to exemption from deduction or
withholding of United States federal income taxes in accordance with Section
10.02.
98
Anything contained herein to the contrary notwithstanding, the Administrative
Agent shall not be required to accept and record assignments hereunder on more
than one day during each week, and each assigning Lender shall coordinate each
assignment with the Administrative Agent so that the proposed effective date of
such assignment shall be the same date as the effective date of each other
assignment during the relevant week by each other assigning Lender.
Notwithstanding the foregoing provisions of this clause (c), if at any time
on or after the Closing Date, any holder of a Senior Debt Claim properly
completes and returns to the Custodian in accordance with Section 6.04 of the
Plan of Reorganization a Letter of Transmittal, together with debt instruments
(to the extent such exist) representing their Old Debt Securities and an
executed counterpart to this Agreement, the Custodian shall promptly (i) provide
notice to the Issuer and the Administrative Agent, which notice shall specify
the name of such holder and the principal amount of the Note to be issued to
such holder and (ii) forward the executed counterpart to the Administrative
Agent. Such holder shall, upon making the deliveries referred to in the previous
sentence, become a Lender party to this Agreement and shall have all the rights
and obligations of a Lender with outstanding Notes in a principal amount set
forth in the notice referred to in the previous sentence. The Administrative
Agent shall notify the Collateral Agent of any holder becoming a Lender pursuant
to this paragraph and the Administrative Agent, the Issuer and the Custodian
shall make arrangements so that, if required, a new Note complying with the
provisions of Section 2.01 is issued to such holder. Upon the issuance of a Note
to a holder of Senior Debt Claims pursuant to this paragraph, the principal
amount of the Note held by the Custodian shall be reduced by an amount equal to
the principal amount of the Note issued to such holder. If any such holder of
Senior Debt Claims is organized under the laws of a jurisdiction outside the
United States, it shall deliver to the Issuer and the Administrative Agent
certification as to exemption from deduction or withholding of United States
federal income taxes in accordance with Section 10.02. Promptly upon any holder
of Senior Debt Claims becoming a Lender, such holder shall deliver to the
Administrative Agent a completed Administrative Questionnaire.
(d) Any Lender may at any time assign all or any portion of its Notes as
security to a Federal Reserve Bank. No such assignment or pledge shall release
the transferor Lender from its obligations hereunder.
(e) The Administrative Agent (acting, for this purpose only, as agent for
the Issuer) shall maintain at its address at which notices are to be given to it
pursuant hereto a copy of each Assignment Agreement delivered to it pursuant to
subsection (c) of this Section 12.06 and a register for the recordation of the
names and addresses of the Lenders and the principal amounts of their respective
Notes outstanding from time to time (the "Register"). The entries in the
Register shall be conclusive, in the absence of manifest error, and the Issuer,
the Guarantors, the Agents and the Lenders may treat each Person whose name is
recorded in the Register as a Lender for all
99
purposes of this Agreement. The Register shall be available for inspection by
the Issuer or any Lender Party at any reasonable time and from time to time upon
reasonable prior notice.
(f) No Assignee, Participant or other transferee of any Lender's rights
shall be entitled to receive any greater payment under Section 10.01 or 10.02
than such Lender would have been entitled to receive with respect to the rights
transferred, unless such transfer is made with the Issuer's prior written
consent or by reason of the provisions of Section 10.01 or 10.02 requiring such
Lender to designate a different Lending Office under certain circumstances or at
a time when the circumstances giving rise to such greater payment did not exist.
Section 12.07. Margin Stock. Each of the Lenders represents to the Agents
and each of the other Lenders that it in good faith is not relying upon any
Margin Stock as collateral in the extension or maintenance of the credit
provided for in this Agreement.
Section 12.08. Governing Law; Submission to Jurisdiction. THIS AGREEMENT,
THE NOTES AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES. SUBJECT TO THE JURISDICTION OF THE COURT, THE ISSUER AND
VENCOR EACH HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES
DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE
COURT SITTING IN NEW YORK CITY FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT
OF OR RELATING TO ANY OF THE FINANCING DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREBY. THE ISSUER AND VENCOR EACH IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT
AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.
Section 12.09. Counterparts; Integration. This Agreement and any amendment
to 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 were
upon the same instrument. This Agreement (together with the other Financing
Documents) constitutes the entire agreement and understanding among the parties
hereto and
100
supersedes any and all prior agreements and understandings, oral or written,
relating to the subject matter hereof.
Section 12.10. Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THE FINANCING DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.
EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AGREEMENT AND THE OTHER FINANCING DOCUMENTS, AS APPLICABLE, BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 12.10.
Section 12.11. Confidentiality. Each Lender Party agrees to keep any non-
public information delivered or made available by Ventas, the Issuer or any
Guarantor to it confidential and to use such information only for the purpose of
evaluating, approving, structuring and administering the Notes; provided that
nothing herein shall prevent any Lender Party from disclosing such information
(i) to Persons employed or retained by such Lender Party who are engaged or
expected to be engaged in evaluating, approving, structuring or administering
the Notes, (ii) to any other Person if reasonably incidental to the
administration of the Notes, (iii) to any other Lender Party, (iv) pursuant to
any subpoena or express direction of any court or other authorized government
agency or as otherwise required by law, (v) upon the request or demand of any
authorized bank regulatory agency, bank examiner or comparable authority, (vi)
which has theretofore been publicly disclosed or is otherwise available to such
Lender Party on a non-confidential basis from a source that is not, to its
knowledge, subject to a confidentiality agreement with Ventas, the Issuer or any
Guarantor, (vii) in connection with any litigation to which any Lender Party or
its subsidiaries or Parent may be a party, (viii) to the extent necessary in
connection with the exercise of any remedy hereunder, (ix) to such Lender
Party's affiliates, legal counsel and independent auditors; (x) to any actual or
proposed Participant or Assignee that has signed a written agreement containing
provisions substantially similar to this Section 12.11 or (xi) any other Person
approved by the Issuer in writing. Any Lender Party that discloses confidential
information to other Persons as contemplated by clause (i), (ii) or (ix) of the
foregoing proviso shall inform such other Persons of the confidential nature of
such information and shall instruct them to keep such information confidential
(except for disclosures permitted by the foregoing proviso). Before any Lender
Party discloses confidential information pursuant to clause (iv) or (vii) of the
foregoing proviso, such Lender Party shall, to the extent permitted by law, use
its best efforts to advise the Issuer, Vencor or Ventas of such proposed
disclosure so that the Issuer, Vencor or Ventas may, in its discretion, seek
101
an appropriate protective order. If and to the extent requested to do so by the
Issuer, the Administrative Agent may deliver copies of information supplied to
it pursuant to Section 5.01 to any Person referred to in clause (x) or (xi) of
the foregoing proviso. Anything herein to the contrary notwithstanding, no
Lender Party shall have any liability with respect to disclosure of confidential
information by electronic transmission, including, without limitation,
facsimile, e-mail and internet communication, as long as such Lender Party
exercises reasonable care in effecting such transmission.
[Remainder of page intentionally left blank]
102
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
BY: Vencor Operating, Inc.
(to be renamed Kindred Healthcare Operating,
Inc.)
By: /s/ Xxxxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President-Finance,
Corporate Controller & Treasurer
BY: Vencor, Inc.
(to be renamed Kindred Healthcare, Inc.)
By: /s/ Xxxxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President-Finance,
Corporate Controller & Treasurer
Notice Address for the Issuer and Vencor:
Vencor, Inc.
(to be renamed Kindred Healthcare, Inc.)
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: General Counsel
Facsimile: 000-000-0000
Internet: xxx.xxxxxx.xxx, and after Vencor, Inc.'s
name change to Kindred Healthcare, Inc.,
xxx.xxxxxxxxxxxxxxxxx.xxx
with a copy to:
Address: Vencor, Inc.
(to be renamed Kindred Healthcare, Inc.)
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attention: Assistant Treasurer
Facsimile: 000-000-0000
S-1
with a copy to:
Address: Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxx X. Xxxxxxx
Facsimile: 212-225-3999
S-2
AGENTS AND LENDERS:
XXXXXX GUARANTY TRUST COMPANY OF
NEW YORK, as Collateral Agent and Administrative
Agent
By: /s/ Xxxxx Xxxx
--------------------------------------
Name: Xxxxx Xxxx
Title: Vice President
For Wire Transfers:
ABA: 000000000
For credit to Loan Unit 8
Account No.: 00000000
Ref.: Vencor, Inc.
Notices Relating to
Operations, etc.:
X.X. Xxxxxx Services
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
All Other Communications:
Xxxxxx Guaranty Trust Company of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Houston Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and
X.X. Xxxxxx Services
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx and Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
S-3
XXXXX FARGO BANK MINNESOTA, N.A., as
Custodian
By: /s/ Xxxx Xxxxxxx
-----------------------------
Name: Xxxx Xxxxxxx
Title: Corporate Trust Officer
S-4
INITIAL LENDER SCHEDULE
------------------------------------------------------------------------
Lender Amount
------------------------------------------------------------------------
Xxxxx Fargo Bank Minnesota, N.A., as Custodian $300,000,000
------------------------------------------------------------------------
SCHEDULE 1
VENCOR, INC. AND ALL CONSOLIDATED SUBSIDIARIES
----------------------------------------------
(alphabetical order)
I. CORPORATIONS AND L.L.C.S
----------------------------
------------------------------------------------------------------------------------------------------------------------------------
No. Name State of Holder of Stock/Ownership Outstanding Percentage Status/(1)/
Organization Interest Equity Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
1. Advanced Infusion Systems, Inc. CA Medisave Pharmacies, Inc. 1,000 shares 100 RS
of common
stock, no par
value per share
2. American X-Rays, Inc. LA Medisave Pharmacies, Inc. 2,000 shares 100 RS
of common
stock, no par
value per share
3. Caribbean Behavioral Health NV Interamericana Health Care Group 1,000 shares 100 RS
Systems, Inc. of common
stock, par
value $1.00
per share
4. C.P.C. of Louisiana, Inc. LA Transitional Hospitals 100 shares of 100 RS
Corporation (NV) common stock,
no par value
per share
------------------------------------------------------------------------------------------------------------------------------------
[New York #878492 v8]
(1): EP = Excluded Partnership
RS = Restricted Subsidiary
SS = Shell Subsidiary
1
------------------------------------------------------------------------------------------------------------------------------------
No. Name State of Holder of Stock/Ownership Outstanding Percentage Status/(1)/
Organization Interest Equity Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
5. Community Behavioral
Health System, Inc. LA CPC Managed Care Health Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
6. Community Psychiatric
Centers of Arkansas, Inc. AR Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
7. Community Psychiatric
Centers of California CA Transitional Hospitals Corporation (NV) 1,518 shares 100 RS
of common
stock, par
value $10.00
per share
8. Community Psychiatric
Centers of Florida, Inc. FL Transitional Hospitals Corporation (NV) 7,500 shares 100 RS
of common
stock, par
value $1.00
per share
9. Community Psychiatric
Centers of Idaho, Inc. ID Transitional Hospitals Corporation (NV) 5,000 shares 100 RS
of common
stock, par
value $10.00
per share
------------------------------------------------------------------------------------------------------------------------------------
[New York #878492 v8]
(1): EP = Excluded Partnership
RS = Restricted Subsidiary
SS = Shell Subsidiary
2
------------------------------------------------------------------------------------------------------------------------------------
No. Name State of Holder of Stock/Ownership Outstanding Percentage Status/1/
Organization Interest Equity Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
10. Community Psychiatric
Centers of Indiana, Inc. IN Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
stock, par
value $1.00
per share
11. Community Psychiatric
Centers of Kansas, Inc. KS Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
12. Community Psychiatric
Centers of Mississippi, Inc. MS Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
13. Community Psychiatric
Centers of Missouri, Inc. MO Transitional Hospitals Corporation (NV) 5,000 shares 100 RS
of common
stock, par
value $10.00
per share
14. Community Psychiatric
Centers of North Carolina, Inc. NC Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
------------------------------------------------------------------------------------------------------------------------------------
[New York #878492 v8]
(1): EP = Excluded Partnership
RS = Restricted Subsidiary
SS = Shell Subsidiary
3
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
15. Community Psychiatric Centers of OK Transitional Hospitals Corporation 1,000 shares 100 RS
Oklahoma, Inc. (NV) of common
stock, par
value $1.00
per share
16. Community Psychiatric Centers of UT Transitional Hospitals Corporation 1,000 shares 100 RS
Utah, Inc. (NV) of common
stock, par
value $1.00
per share
17. Community Psychiatric Centers CA Community Psychiatric Centers of 2,500 shares 100 RS
Properties Incorporated California of common
stock, par
value $10.00
per share
18. Community Psychiatric Centers OK Transitional Hospitals Corporation 1,000 shares 100 RS
Properties of Oklahoma, Inc. (NV) of common
stock, par
value $1.00
per share
19. Community Psychiatric Centers TX Transitional Hospitals Corporation 1,000 shares 100 RS
Properties of Texas, Inc. (NV) of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
4
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
20. Community Psychiatric Centers UT Transitional Hospitals Corporation 1,000 shares 100 RS
Properties of Utah, Inc. (NV) of common
stock, par
value $1.00
per share
21. Cornerstone Insurance Company CI Vencor, Inc. 1,000,000 100 Cornerstone
shares of
common stock,
par value
$1.00 per
share
22. Courtland Gardens Health Center, CT PersonaCare of Connecticut, Inc. 1,000 shares 100 RS
Inc. of common
stock, no
par value
per share
23. CPC Investment Corp. CA Community Psychiatric Centers 5,000 shares 100 RS
Properties Incorporated of common
stock, par
value $1.00
per share
24. CPC Managed Care Health Services, DE Transitional Hospitals Corporation 1,000 shares 100 RS
Inc. (NV) of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
5
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
25. CPC of Georgia, Inc. GA Transitional Hospitals 500 shares of 100 RS
Corporation (NV) common stock,
par value
$1.00 per share
26. CPC Properties of Arkansas, AR Transitional Hospitals 1,000 shares 100 RS
Inc. Corporation (NV) of common
stock, par
value $1.00
per share
27. CPC Properties of Illinois, IL Community Psychiatric Centers 1,000 shares 100 RS
Inc. Properties Incorporated of common
stock, par
value $1.00
per share
28. CPC Properties of Indiana, IN Transitional Hospitals 1,000 shares 100 RS
Inc. Corporation (NV) of common
stock, par
value $1.00
per share
29. CPC Properties of Kansas, KS Transitional Hospitals 1,000 shares 100 RS
Inc. Corporation (NV) of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
6
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
30. CPC Properties of Louisiana, Inc. LA Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
31. CPC Properties of Mississippi, Inc. MS Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
32. CPC Properties of Missouri, Inc. MO Community Psychiatric Centers Properties 1,500 shares 100 RS
Incorporated of common
stock, par
value $10.00
per share
33. CPC Properties of North Carolina, Inc. NC Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
34. First Rehab, Inc. DE Medisave Pharmacies, Inc. 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
7
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
35. Florida Hospital Properties, Inc. FL Transitional Hospitals Corporation (NV) 7,500 shares 100 RS
of common
stock, par
value $1.00
per share
36. Health Care Holdings, Inc. DE Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
37. Health Care Technology, Inc. DE Health Care Holdings, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
38. Helian ASC of Northridge, Inc. CA Helian Health Group, Inc. 100,000 shares100 RS
of common
stock, no par
value per share
39. Helian Health Group, Inc. DE Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $.01 per
share
====================================================================================================================================
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
8
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
40. Helian Recovery Corporation CA Helian Health Group, Inc. 100 shares of 100 RS
common stock,
no par value
per share
41. Homestead Health Center, Inc. CT PersonaCare of Connecticut, Inc. 1,000 shares 100 RS
of common
stock, no par
value per share
42. Horizon Healthcare Services, Inc. GA Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $10.00
per share
43. Interamericana Health Care Group NV Transitional Hospitals Corporation (NV) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
44. X. X. Xxxxxx Hospital, Inc. MA Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
9
====================================================================================================================================
Outstanding
No. Name State of Equity Percentage
Oragnization Holder of Stock/Ownership Interest Interest Status/(1)/
------------------------------------------------------------------------------------------------------------------------------------
45. Lafayette Health Care Center, Inc. GA PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, no par
value per share
46. MedAssure, L.L.C. KY Vencare, Inc. N/A 50 EP
47. MedEquities, Inc. CA Helian ASC of Northridge, Inc. 10,000 shares 100 RS
of common
stock, no par
value per share
48. Medisave of Tennessee, Inc. DE Medisave Pharmacies, Inc. 1,000 shares 100 RS
of common
stock, no par
value per share
49. Medisave Pharmacies, Inc. DE Vencor Operating, Inc. 10 shares of 100 RS
common stock,
par value
$100.00 per
share
====================================================================================================================================
[New York#878492v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
10
====================================================================================================================================
Outstanding
No. Name State of Equity Percentage
Oragnization Holder of Stock/Ownership Interest Interest Status/(1)/
------------------------------------------------------------------------------------------------------------------------------------
50. Old Orchard Hospital, Inc. IL Transitional Hospitals 100 shares of 100 RS
Corporation (NV) common stock,
par value
$10.00 per
share
51. Palo Alto Surgecenter Corporation CA Helian Health Group, Inc. 100 shares of 100 RS
common stock,
no par value
per share
52. Peachtree-Parkwood Hospital, Inc. GA CPC of Georgia, Inc. 200 shares of 100 RS
common stock,
par value
$1.00 per share
53. PersonaCare, Inc. DE Vencare Rehab Services, Inc. 995 shares of 100 RS
common stock,
par value $.01
per share
54. PersonaCare Living Center of DE PersonaCare, Inc. 1,000 shares 100 RS
Clearwater, Inc. of common
stock, par
value $.001
per share
====================================================================================================================================
[New York#878492v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
11
====================================================================================================================================
Outstanding
No. Name State of Equity Percentage
Oragnization Holder of Stock/Ownership Interest Interest Status/(1)/
------------------------------------------------------------------------------------------------------------------------------------
55. PersonaCare of Bradenton, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
56. PersonaCare of Clearwater, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
57. PersonaCare of Connecticut, Inc. CT PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, no par
value per share
58. PersonaCare of Georgia, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
59. PersonaCare of Huntsville, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
====================================================================================================================================
[New York#878492v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
12
------------------------------------------------------------------------------------------------------------------------------------
Outstanding
No. Name State of Holder of Stock/ Equity Percentage Status/(1)/
Organization Ownership Interest Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
60. PersonaCare of Little Rock, Inc. DE PersonaCare, Inc. 100 shares of 100 RS
common stock,
par value
$.001 per share
61. PersonaCare of Ohio, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
62. PersonaCare of Owensboro, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
63. PersonaCare of Pennsylvania, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
64. PersonaCare of Pompano East, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
------------------------------------------------------------------------------------------------------------------------------------
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
13
------------------------------------------------------------------------------------------------------------------------------------
Outstanding
No. Name State of Holder of Stock/ Equity Percentage Status/(1)/
Organization Ownership Interest Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
65. PersonaCare of Pompano West, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
66. PersonaCare of Reading, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
67. PersonaCare of San Antonio, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
68. PersonaCare of San Xxxxx, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
69. PersonaCare of Shreveport, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
------------------------------------------------------------------------------------------------------------------------------------
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
14
------------------------------------------------------------------------------------------------------------------------------------
Outstanding
No. Name State of Holder of Stock/ Equity Percentage Status/(1)/
Organization Ownership Interest Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
70. PersonaCare of St. Petersburg, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
71. PersonaCare of Warner Robins, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
72. PersonaCare of Wisconsin, Inc. DE PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
73. PersonaCare Properties, Inc. GA PersonaCare, Inc. 1,000 shares 100 RS
of common
stock, par
value $.01 per
share
74. ProData Systems, Inc. AL Vencor Home Care and 333.33 shares 100 RS
Hospice Indiana of common
Partnership stock, par
value $1.00
per share
------------------------------------------------------------------------------------------------------------------------------------
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
15
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
75. Recovery Inns of America, Inc. CA Helian Recovery Corporation 2,500 shares 100 RS
of common
stock, no par
value per share
76. Respiratory Care Services, Inc. DE Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $.01 per
share
77. Stamford Health Facilities, Inc. CT PersonaCare of Connecticut, Inc. 1,000 shares 100 RS
of common
stock, no par
value per share
78. THC - Chicago, Inc. IL Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
79. THC - Hollywood, Inc. FL Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
====================================================================================================================================
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
16
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
80. THC - Houston, Inc. TX Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
81. THC - Minneapolis, Inc. MN Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
82. THC - North Shore, Inc. IL THC - Chicago, Inc. 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
83. THC - Orange County, Inc. CA Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
84. THC - San Diego, Inc. CA Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
====================================================================================================================================
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
17
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
85. THC - Seattle, Inc. WA Transitional Hospitals Corporation (DE) 1,000 shares 100 RS
of common
stock, par
value $1.00
per share
86. TheraTx Health Services, Inc. DE Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
87. TheraTx Healthcare Management,
Inc. DE Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
88. TheraTx Management Services,
Inc. CA Vencare Rehab Services, Inc. 10,000 shares 100 RS
of common
stock, par
value $0.01
per share
89. TheraTx Medical Supplies, Inc. DE Vencare Rehab Services, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
====================================================================================================================================
(1) EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
18
====================================================================================================================================
No. Name State of Holder of Stock/Ownership Interest
Organization
------------------------------------------------------------------------------------------------------------------------------------
90. TheraTx Rehabilitation Services, Inc. DE TheraTx Health Services, Inc.
91. TheraTx Staffing, Inc. IL Vencare Rehab Services, Inc.
92. Transitional Hospitals Corporation NV Vencor Operating, Inc.
93. Transitional Hospitals Corporation DE Transitional Hospitals Corporation (NV)
94. Transitional Hospitals Corporation of Indiana, Inc. IN Transitional Hospitals Corporation (DE)
====================================================================================================================================
====================================================================================================================================
Outstanding
Equity Percentage Status/(1)/
Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
1,000 shares 100 RS
of common
stock, par
value $.001
per share
1,000 shares 100 RS
of common
stock, no par
value per share
100 shares of 100 RS
common stock,
par value
$1.00 per share
1,000 shares 100 RS
of common
stock, par
value $1.00
per share .
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
19
====================================================================================================================================
No. Name State of Holder of Stock/Ownership Interest
Organization
------------------------------------------------------------------------------------------------------------------------------------
95. Transitional Hospitals Corporation of Louisiana, Inc. LA Transitional Hospitals Corporation (DE)
96. Transitional Hospitals Corporation of Michigan, Inc. MI Transitional Hospitals Corporation (NV)
97. Transitional Hospitals Corporation of New Mexico, Inc. NM Transitional Hospitals Corporation (DE)
98. Transitional Hospitals Corporation of Nevada, Inc. NV Transitional Hospitals Corporation (DE)
99. Transitional Hospitals Corporation of Tampa, Inc. FL Transitional Hospitals Corporation (DE)
====================================================================================================================================
====================================================================================================================================
Outstanding
Equity Percentage Status/(1)/
Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
20
====================================================================================================================================
No. Name State of Holder of Stock/Ownership Interest
Organization
------------------------------------------------------------------------------------------------------------------------------------
100. Transitional Hospitals Corporation of Texas, Inc. TX Transitional Hospitals Corporation (DE)
101. Transitional Hospitals Corporation of Wisconsin, Inc. WI Transitional Hospitals Corporation (DE)
102. Xxxxxx Nursing Center, Inc. GA PersonaCare, Inc.
103. Xxxxxxxx Enterprises, Inc. GA Horizon Healthcare Services, Inc.
104. VC - OIA, Inc. AZ Helian Health Group, Inc.
====================================================================================================================================
====================================================================================================================================
Outstanding
Equity Percentage Status/(1)/
Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
1,000 shares 100 RS
of common
stock, par
value $1.00
per share
500 shares of 100 RS
common stock,
par value
$1.00 per share
100 shares of 100 RS
common stock,
par value
$1.00 per share
1,000 shares 100 RS
of common
stock, no par
value per share
====================================================================================================================================
[New York #878492 v8]
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
21
------------------------------------------------------------------------------------------------------------------------------------
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
105. VC - TOHC, Inc. AZ Helian Health Group, Inc. 1,000 shares 100 RS
of common
stock, par
value $.01
per share
106. XX - XX, Inc. FL Vencare Rehab Services, Inc. 700 shares 100 RS
of common
stock, par
value $.01
per share
107. Vencare, Inc. DE Vencor Operating, Inc. 100 shares 100 RS
of common
stock, par
value $.25
per share
108. Vencare Rehab Services, Inc./1/ DE Vencor Operating, Inc. 1,000 shares 100 RS
of common
stock, par
value $.001
per share
109. Vencor, Inc. DE N/A N/A N/A Parent
Guarantor
------------------------------------------------------------------------------------------------------------------------------------
________________________
/1/ Formerly TheraTX, Inc.
[New York #878492 v8]
(1): EP=Excluded Partnership
RS=Restricted Subsidiary
SS=Shell Subsidiary
22
------------------------------------------------------------------------------------------------------------------------------------
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
110. Vencor Facility Services, Inc. DE Vencor Operating, Inc. 100 shares of 100 RS
common stock
par value $.25
per share
111. Vencor Holdings, L.L.C. DE Vencor Operating, Inc. 100 RS
112. Vencor Home Care Services, Inc. DE Vencor Operating, Inc. 100 shares of 100 RS
common stock,
par value $.25
per share
113. Vencor Hospice, Inc. KY Vencare, Inc. 60 shares of 100 RS
common stock,
par value $.25
per share
114. Vencor Hospitals East, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
115. Vencor Hospitals West, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
116. Vencor Insurance Holdings, Inc. DE Vencor Operating, Inc. 100 shares of 100 RS
common stock,
par value $.25
Per share
------------------------------------------------------------------------------------------------------------------------------------
[New York #878492 v8]
(1): EP = Excluded Partnership
RS = Restricted Subsidiary
SS = Shell Subsidiary
23
------------------------------------------------------------------------------------------------------------------------------------
Outstanding
No. Name State of Holder of Stock/Ownership Equity Percentage Status/(1)/
Organization Interest Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
117. Vencor Investment Company DE Vencor Operating, Inc. 100 shares of 100 RS
common stock,
par value $.25
per share
118. Vencor Nevada, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
119. Vencor Nursing Centers Central, L.L.C. DE Vencor Nursing Centers N/A 100 RS
Limited Partnership
120. Vencor Nursing Centers East, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
121. Vencor Nursing Centers North, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
122. Vencor Nursing Centers South, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
123. Vencor Nursing Centers West, L.L.C. DE Vencor Operating, Inc. N/A 100 RS
124. Vencor Operating, Inc. DE Vencor, Inc. 100 shares of 100 Issuer/
common stock, Borrower
par value $.25
per share
125. Vencor Pediatric Care, Inc. DE Vencor Operating, Inc. 100 shares of 100 RS
common stock,
par value $.25
per share
------------------------------------------------------------------------------------------------------------------------------------
[New York #878492 v8]
(1): EP = Excluded Partnership
RS = Restricted Subsidiary
SS = Shell Subsidiary
24
====================================================================================================================================
Outstanding
State of Equity Percentage
No. Name Organization Holder of Stock/Ownership Interest Interest Interest Status/(1)/
------------------------------------------------------------------------------------------------------------------------------------
126. Vencor Provider Network, Inc. DE Vencor Insurance Holdings, Inc. 100 shares of 100 RS
common stock,
par value $.25
per share
127. Ventech Systems, Inc. DE Vencor Operating, Inc. 100 shares of 100 RS
common stock,
par value $.25
per share
====================================================================================================================================
[New York #878492 v8]
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
25
II. PARTNERSHIPS
-----------------
====================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
------------------------------------------------------------------------------------------------------------------------------------
128. California Respiratory Care CA Advanced Infusion Systems, Inc. N/A 51(GP) EP
Partnership
129. Foothill Nursing Company CA Vencor Operating, Inc. N/A 50(GP) EP
Partnership
130. Northridge Surgery Center CA MedEquities, Inc. N/A 43(GP) EP
Development, Ltd.
131. Northridge Surgery Center, Ltd. CA Northridge Surgery Center N/A 38(GP) EP
Development, Ltd.
Helian Health Group, Inc. N/A 13.5(LP)
Helian ASC of Northridge, Inc. N/A 13(GP),
6(LP)
132. Pharmaceutical Infusion Therapy CA Advanced Infusion Systems, Inc. N/A 50.99(GP) EP
133. Recovery Inn of Menlo Park, L.P. CA Recovery Inns of America, Inc. N/A 12(LP) EP
58(GP),
Helian Recovery Corporation N/A 27.6(LP)
134. Stamford Health Associates, L.P. CT Stamford Health Facilities, Inc. N/A 1(GP) SS
PersonaCare, Inc. N/A 99(LP)
135. Vencor Home Care and Hospice IN Vencor Home Care Services, Inc. N/A 50(GP) RS
Indiana Partnership
Vencor Hospice, Inc. N/A 50(GP)
====================================================================================================================================
[New York #878492 v8]
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
26
===================================================================================================================================
Outstanding
No. Name State of Holder of Stock/Ownership Interest Equity Percentage Status/(1)/
Organization Interest Interest
-----------------------------------------------------------------------------------------------------------------------------------
136. Vencor Hospitals Limited DE Vencor Nursing Centers Limited N/A 1(GP) RS
Partnership Partnership
Vencor Operating, Inc. N/A 1(GP),
N/A 98(LP)
137. Vencor Nursing Centers Central DE Vencor Nursing Centers Limited N/A 1(GP) RS
Limited Partnership Partnership
Vencor Operating, Inc. N/A 1(GP),
98(LP)
138. Vencor Nursing Centers Limited DE Vencor Hospitals Limited N/A 1(GP) RS
Partnership Partnership
Vencor Operating, Inc. N/A 1(GP),
98(LP)
139. Visiting Nurse Advanced Infusion CA Advanced Infusion Systems, Inc. N/A 50.01(GP) EP
Systems - Anaheim
140. Visiting Nurse Advanced Infusion CA Advanced Infusion Systems, Inc. N/A 51.01(GP) EP
Systems - Colton
141. Visiting Nurse Advanced CA Advanced Infusion Systems, Inc. N/A 51.01(GP) EP
Infusion Systems -
Newbury Park
====================================================================================================================================
[New York #878492 v8]
(1): EP= Excluded Partnership
RS= Restricted Subsidiary
SS= Shell Subsidiary
27
SCHEDULE 2
EXISTING AFFILIATE AGREEMENTS
-----------------------------
---------------------------------------------------------------------------------------------------------
FACILITY AGREEMENT RELEVANT AFFILIATE
---------------------------------------------------------------------------------------------------------
926 Management Agreement dated as of February Hillhaven-MSC Partnership
Nineteenth Avenue HCC 29, 1988, by and between Hillhaven, Inc.
2043 - 19/th/ Avenue (whose obligations have been assumed by
San Francisco, CA Vencor Nursing Centers West, LLC), and
Hillhaven-MSC Partnership, a California
general partnership
---------------------------------------------------------------------------------------------------------
949 Management Agreement dated as of 1985, by Ledgewood Healthcare
Ledgewood Rehab. & Nsg. and between The Hillhaven Corporation Corporation
00 Xxxxxxx Xxxxxx (whose obligations have been assumed by
Beverly, MA Vencor Nursing Centers East, LLC), and
Ledgewood Health Care Corporation, a
Massachusetts corporation
---------------------------------------------------------------------------------------------------------
983 Long Term Care Facility Management Fox Hill Village Partnership
Xxxxx House Nrsg. Ctr. Agreement dated as of July 1, 1990, by and
00 Xxxxxxxx Xxxxx between First Healthcare Corporation
Westwood, MA (whose obligations have been assumed by
Vencor Nursing Centers East, LLC), and Fox
Hill Village Partnership, a Massachusetts
general partnership
---------------------------------------------------------------------------------------------------------
995 Agreement to Provide Management Services Starr Farm Partnership
Starr Farm Nursing to a Health Care Facility dated as of
Center December 30, 1986, by and between First
00 Xxxxx Xxxx Xxxx Healthcare Corporation (whose obligations
Burlington, VT have been assumed by Vencor Nursing
Centers East, LLC), and Starr Farm
Partnership, a Vermont general partnership
---------------------------------------------------------------------------------------------------------
Corporate Shareholders and Registration Rights Atria Communities, Inc.
Agreement dated as of September 15, 1998
among Atria Communities, Inc., Kapson
Senior Quarters Corp., Vencor, Inc.,
Vencor Holdings, LLC and the management
shareholders party thereto
---------------------------------------------------------------------------------------------------------
1
---------------------------------------------------------------------------------------------------------
Corporate Sale and Purchase Agreement dated February HealthEssentials Solutions,
25, 1999 between NPPA of America, Inc., Inc.
HealthEssentials Solutions, Inc.; Xxxxxx
X. Xxxxx, Xx., Xxxxxxx X. Xxxxxxx, Xxxx X.
Xxxxxxx, Xxxxxx X. Xxxxxx and Vencor
Operating, Inc. (continuing registration
and preemptive rights)
---------------------------------------------------------------------------------------------------------
Corporate $500,000 Promissory Note made by HealthEssentials Solutions,
HealthEssentials Solutions, Inc. in favor Inc.
of Vencor Operating, Inc.
---------------------------------------------------------------------------------------------------------
2
SCHEDULE 3
OWNED PROPERTIES
----------------
State/
------
Facility #: Facility Name: County, City, State Location: Facility Type: Index #:
----------- -------------- ----------------------------- -------------- --------
CA#212 Woodside Nursing Center San Xxxx Obispo, San Xxxx Nursing center DIP#1
Obispo, CA
CA#4-608/ Vencor Hospital - Sacramento Sacramento, Folsom, CA Hospital DIP#2
4-609
CA#4-695 Vencor Hospital - Los Angeles Los Angeles, Los Angeles, CA Hospital DIP#3
FL#610 Boca Raton Rehabilitation Center Palm Beach, Boca Raton, FL Nursing center DIP#4
TX#4-610 Vencor Hospital - Dallas Dallas, Dallas, TX Hospital DIP#5
TX#4-649 Vencor Hospital - Arlington Tarrant, Arlington, TX Hospital DIP#6
WA#160 First Health Care Center King, Seattle, WA Nursing center DIP#7
WA#4-643 Vencor Hospital - Seattle King, Seattle, WA Hospital DIP#8
WI#4-663 Vencor Hospital - Milwaukee Milwaukee, Greenfield, WI Hospital DIP#9
FL#115 Rehab Center of the Xxxx Xxxxxxx Xxxx Xxxxx, Xxxx Xxxxx, XX Nursing center FP#1
XX#000 Xxxxxxxx Xxxx Xxxxxx Xxxxxx, Xxxxxxxx, Xxxxx Nursing center FP#2
XX#000 Xxxxxxxxxxxx Xxxxxxxx Xxxxxxxxx, Xxxxxxxxxx, XX Headquarters FP#3
KY#699 OK Storage Building Jefferson, Louisville, KY Storage facility FP#4
SCHEDULE 4
INITIAL MASTER LEASE PROPERTIES; OTHER LEASED PROPERTY; THIRD PARTY LEASES
--------------------------------------------------------------------------
INITIAL MASTER LEASE #1:
State/
------
Facility #: Facility Name: County, City, State Location: Facility Type: Index #:
----------- ------------- ----------------------------- -------------- --------
XX#000 Xxxxxx Xxxxxxxxxx & Xxxxx Xxxxxx Xxxx, Xxxxxx, XX Nursing center ML#1-1
AZ#742 Sonoran Rehab & Care Center Maricopa, Phoenix, AZ Nursing center ML#1-2
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxxx Xxxxxxxx, Xxxxxxx, XX Hospital ML#1-3
XX#000 Xxx Xxxx Xxxxxxxxxx Xxxxxx Xxx Xxxxxxxxx, Xxx Xxxxxxxxx, XX Nursing center ML#1-4
CA#167 Canyonwood Nursing & Rehab Center Shasta, Redding, CA Nursing center ML#1-5
CA#335 Xxxxxx Xxxxxxxxxx Xxxxxx Xxx Xxxxxxxxx, Xxx Xxxxxxxxx, XX Nursing center XX#0-0
XX#000 Xx Xxxx Xxxxxxxxxx Xxxxxx Xxxxxx, Xxxxxx, XX Nursing center ML#1-7
CA#738 Bay View Nursing & Rehab Center Alameda, Alameda, CA Nursing center ML#1-8
CA#4-622 Vencor Hospital - San Xxxxxxx Xxxxxxx, San Leandro, CA Hospital XX#0-0
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxx Xxxxxx Orange, Westminster, CA Hospital ML#1-10
CA#4-648 Vencor Hospital - San Diego San Diego, San Diego, CA Hospital ML#1-11
CA#4-693 Recovery Inn of Xxxxx Xxxx Xxx Xxxxx, Xxxxx Xxxx, XX Hospital ML#1-12
XX#000 Xxxxxx Xxxx Xxxxxx Xxxxxxxx, Xxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxxx Xxxxx Xxxxxxxxxx Xxxxxxxx, Xxx Xxxxxxx, CT Nursing center XX#0-00
XX#000 Xxxxxx Xxxxxxxx Xxx Xxxxxx, Xxx Xxxxxx, CT Nursing center ML#1-15
FL#117 East Manor Medical Care Center Sarasota, Sarasota, FL Nursing center ML#1-16
FL#4-602 Vencor Hospital - Coral Gables Dade, Coral Gables, FL Hospital ML#1-17
FL#4-652 Vencor Hospital - North Florida Clay, Green Cove Springs, FL Hospital ML#1-18
GA#660 Savannah Specialty Care Center Chatham, Savannah, GA Nursing center XX#0-00
XX#000 Xxxxxxx Xxxx Xxxxxx Xxxxxx, Xxxxxxxx, XX Nursing center ML#1-20
ID#221 Lewiston Rehab & Care Center Ney Perce, Lewiston, ID Nursing center ML#1-21
ID#409 Mountain Valley Care and Rehab Shoshone, Xxxxxxx, ID Nursing center ML#1-22
IL#4-637 Vencor Hospital - Chicago North Xxxx, Chicago, IL Hospital XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxxxxx Xxxx, Xxxxxxxxx, XX Hospital ML#1-24
IN#112 Royal Oaks Healthcare & Rehab Center Vigo, Terre Haute, IN Nursing center ML#1-25
IN#113 Southwood Health & Rehab Center Vigo, Terre Haute, IN Nursing center ML#1-26
IN#286 Columbia Healthcare Facility Vanderburgh, Evansville, IN Nursing center ML#1-27
IN#406 Muncie Health Care & Rehab Delaware, Muncie, IN Nursing center ML#1-28
IN#779 Westview Nursing & Rehab Center Xxxxxxxx, Bedford, IN Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - XxXxxxxx XxXxxxxx, LaGrange, IN Hospital ML#1-30
IN#4-638 Vencor Hospital - Indianapolis Xxxxxx, Indianapolis, IN Hospital ML#1-31
KY#280 Winchester Center for Health/Rehab Xxxxx, Winchester, KY Nursing center ML#1-32
KY#783 Lexington Centre for Health & Rehab Fayette, Lexington, KY Nursing center ML#1-33
KY#784 North Centre for Health & Rehab Jefferson, Louisville, KY Nursing center ML#1-34
KY#4-633 Vencor Hospital - Louisville Jefferson, Louisville, KY Hospital XX#0-00
XX#000 Xxxxxx Rehabilitation & Living Center Oxford, Norway, ME Nursing center XX#0-00
XX#000 Xxxxx Xxxxxxx Xxxxx & Nursing Center Xxxx, Rockland, ME Nursing center ML#1-37
ME#555 Brentwood Rehab & Nursing Center Penobscot, Yarmouth, ME Nursing center XX#0-00
XX#000 Xxxxxxxxxx Xxxxx Nursing Home Lincoln, Waldoboro, ME Nursing center XX#0-00
XX#000 Xxxxxx Xxxxx Rehab & Nursing Center W. Roxbury, Jamaica Plain, MA Nursing center XX#0-00
XX#000 Xxxx Xxxxx Xxxxxxxxxx Care Center Stoughton, Stoughton, MA Nursing center XX#0-00
XX#000 Xxxxxxx Xxxxx Xxxxx & Nursing Center Essex, Newburyport, MA Nursing center XX#0-00
XX#000 Xxxxxxxxxxx Xxxxx Nursing & Care Center Essex, Saugus, MA Nursing center ML#1-43
MA#518 Timberlyn Heights Nursing & Alzheimers Bershire, Great Barrington, MA Nursing center XX#0-00
Xxxxxx
XX#000 Xxxxxxxxx Health Care Nursing Center Norfolk, Needham, MA Nursing center ML#1-45
2
XX#000 Xxxxxxxxx Xxxxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxxx Xxxxx Nursing Home Middlesex, Marlborough, MA Nursing center ML#1-47
MA#537 Quincy Rehab & Nursing Center Norfolk, Quincy, MA Nursing center XX#0-00
XX#000 Xxxx Xxxxxxx Xxxxx Xxxxxxx, Xxxx Xxxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxx Xxxx Xxxxx & Living Center Barnstable, X. Xxxxxx, MA Nursing center XX#0-00
XX#000 Xxxxxxxxx Xxxx Healthcare Essex, Beverly, MA Nursing center XX#0-00
XX#000 Xxxxxx Xxxxx Nursing & Rehab Center Plymouth, Abington, MA Nursing center XX#0-00
XX#000 Xxxxxx Xxxxx & Nursing Center Middlesex, Concord, MA Nursing center ML#1-53
MA#985/ Xxxxxxxxxx House Nursing & Rehab Center Norfolk, Walpole, MA Nursing center ML#1-54
198
MN#4-659 Vencor Hospital - Minneapolis Hennepin, Golden Valley, MN Hospital ML#1-55
MO#4-680 Vencor Hospital - Xx. Xxxxx Xx. Xxxxx, Xx. Xxxxx, XX Hospital ML#1-56
MT#416 Park Place Health Care Center Cascade, Great Falls, MT Nursing center ML#1-57
MT#433 Parkview Acres Care & Rehab Center Beaverhead, Dillon, MT Nursing center ML#1-58
NV#640 Las Vegas Healthcare & Rehab Center Xxxxx, Las Vegas, NV Nursing center ML#1-59
NH#591 Dover Rehab & Living Center Strafford, Dover, NH Nursing center ML#1-60
NH#593 Hanover Terrace Healthcare Hanover, Hanover, NH Nursing center ML#1-61
NC#137 Sunnybrook Alzheimers & Healthcare Spec. Wake, Raleigh, NC Nursing center ML#1-62
NC#138 Blue Ridge Rehab & Healthcare Center Buncombe, Asheville, NC Nursing center ML#1-63
NC#188 Cypress Pointe Rehab & Healthcare Center New Hanover, Wilmington, NC Nursing center ML#1-64
NC#190 Winston-Salem Rehab & Healthcare Center Xxxxxxx, Xxxxxxx-Salem, NC Nursing center XX#0-00
XX#000 Xxxxx Xxxxx Xxxxx Xxxxxxx, Xxxxxxx-Xxxxx, XX Nursing center ML#1-66
NC#704 Guardian Care of Roanoke Rapids Halifax, Roanoke Rapids, NC Nursing center ML#1-67
NC#707 Rehab & Nursing Center of Monroe Union, Monroe, NC Nursing center ML#1-68
NC#724 Rehab & Health Center of Gastonia Xxxxxx, Gastonia, NC Nursing center XX#0-00
XX#000 Xxxxxx Xxxx Xxxxx & Healthcare Center Orange, Chapel Hill, NC Nursing center ML#1-70
OH#560 Xxxxxxxx Xxxxx Health Care Center Franklin, Columbus, OH Nursing center ML#1-71
3
OH#572 Winchester Place Nursing & Rehab Center Franklin, Canal Winchester, OH Nursing center ML#1-72
OH#577 Xxxxxxx Park Nursing & Rehab Center Franklin, Columbus, OH Nursing center ML#1-73
OH#635 Coshocton Health & Rehab Center Coshocton, Coshocton, OH Nursing center ML#1-74
OH#868 Lebanon Country Xxxxx Xxxxxx, Lebanon, OH Nursing center ML#1-75
OK#4-618 Vencor Hospital - Oklahoma City Oklahoma, Oklahoma City, OK Hospital XX#0-00
XX#000 Xxxxxxxxx Xxxx Xxxxxx Xxxxxx, Xxxxx, XX Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxxxxxx Xxxxxxxxx, Oakdale, PA Hospital ML#1-78
TN#132 Madison Healthcare & Rehab Center Davidson, Madison, TN Nursing center ML#1-79
TN#884 Masters Health Care Center Putnam, Algood, TN Nursing center ML#1-80
TN#4-628 Vencor Hospital - Chattanooga Xxxxxxxx, Chattanooga, TN Hospital XX#0-00
XX#000 Xxxxxxx Xxxx Xxxxxx Xxxxx, Xxxxx, XX Nursing center XX#0-00
XX#000 Xx. Xxxxxx Care and Rehab Center Washington, St. Xxxxxx, UT Nursing center ML#1-83
UT#655 Federal Heights Rehab & Xxxxxxx Xxxxxx Xxxx Xxxx, Xxxx Xxxx Xxxx, XX Nursing center XX#0-00
XX#000 Xxxxxxxxx Xxxxxx Xxxxx & Healthcare Center Suffolk, Suffolk, VA Nursing center XX#0-00
XX#000 Xxxxx Xxxxxx Xxxxx & Healthcare Center Princess Xxxx, Virginia Beach, VA Nursing center ML#1-86
WA#114 Arden Rehabilitation & Healthcare Center King, Seattle, WA Nursing center XX#0-00
XX#000 Xxxxxxxxx Xxxxxxxxx Xxxx Xxxxxx Xxxxxxx, Xxxxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxxxx Xxxxx Xxxx Xxxxxx Xxxxxx, Xxxxxxxx, XX Nursing center ML#1-89
WA#180 Vencor of Vancouver Healthcare & Rehab Xxxxx, Vancouver, WA Nursing center XX#0-00
XX#000 Xxxxxxxx Xxxxxx & Xxxxx Xxxxxx Xxxxx, Xxxxxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxx Xxxx Xxxxxxxxxx Xxxx, Xxxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxxx Xxxx Xxxx Xxxxxx Xxxxxxxxx, Xxxxxxxx, XX Nursing center ML#1-93
WI#769 North Ridge Medical & Rehab Center Manitowoc, Manitowoc, WI Nursing center ML#1-94
WI#772 Family Heritage Medical & Rehab Center Wood, Wisconsin Rapids, WI Nursing center XX#0-00
XX#000 Xxxxxxxx Xxxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx, XX Nursing center ML#1-96
4
WI#776 Woodstock Health & Rehab Center Kenosha, Kenosha, WI Nursing center ML#1-97
WY#441 Mountain Towers Healthcare & Rehab Laramie, Cheyenne, WY Nursing center XX#0-00
XX#000 Xxxx Xxxxx Healthcare & Rehab Center Fremont, Riverton, WY Nursing center ML#1-99
WY#483 Sage View Care Center Sweetwater, Rock Springs, WY Nursing center ML#1-100
INITIAL MASTER LEASE #2:
State/
----------
Facility #: Facility Name: County, City, State Location: Facility Type: Index #:
---------- -------------- ----------------------------- -------------- --------
AL#804 Rehab & Healthcare Center of Birmingham Jefferson, Birmingham, AL Nursing center ML#2-1
AZ#743 Desert Life Rehab & Care Center Pima, Tuscon, AZ Nursing center ML#2-2
CA#320 Magnolia Gardens Care Center San Mateo, Burlingame, CA Nursing center ML#2-3
CA#420 Maywood Acres Healthcare Center Ventura, Oxnard, CA Nursing center XX#0-0
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxxx Xxx Xxxxxxxxx, Xxxxxxx, XX Hospital XX#0-0
XX#000 Xxxxxx Xxxxx Health Care Center Arapahoe, Englewood, CO Nursing center XX#0-0
XX#000 Xxxxxxxx Xxxxx Center New London, Norwich, CT Nursing center ML#2-7
XX#0000 Xxxxxxxxx Xxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxx, XX Nursing center ML#2-8
FL#125 Titusville Rehab & Nursing Center Brevard, Titusville, FL Nursing center ML#2-9
XX#000 Xxx Xxxxxx Xxxxxxx Xxxxxxxx Xxxxxxxx, Xx. Xxxxxxxxxx, XX Nursing center ML#2-10
FL#836 Rehab & Health Center of Tampa Hillsborough, Tampa, FL Nursing center ML#2-11
FL#837 Rehab & Health Center of Cape Xxxxx Xxx, Cape Coral, FL Nursing center ML#2-12
FL#1217 Casa Xxxx Rehab & Ext. Care Manatee, Bradenton, FL Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xx. Xxxxxxxxxx Pinellas, St. Petersburg, FL Hospital ML#2-14
FL#4-674 Vencor Hospital - Central Tampa Hillsborough, Tampa, FL Hospital ML#2-15
GA#1228 Lafayette Nursing & Rehab Center Fayette, Fayetteville, Ga Nursing center XX#0-00
XX#000 Xxxxxxxxx Xxxxx/Xxxx Xxxxxx Xxx, Xxxxx, XX Nursing center XX#0-00
XX#000 Xxxxx Xxxx Xxxxxx Xxxxx, Xxxxx, XX Nursing center ML#2-18
5
ID#223 Weiser Rehabilitation & Care Washington, Weiser, ID Nursing center ML#2-19
IL#4-615 Vencor Hospital - Sycamore De Xxxx, Sycamore, IL Hospital ML#2-20
IN#111 Rolling Hills Health Care Center Xxxxx, New Albany, IN Nursing center XX#0-00
XX#000 Xxxxxxx Xxxxxxx Health & Rehab Center Xxxxxx, Kokomo, IN Nursing center XX#0-00
XX#000 Xxxxxxxx Health Care Center Xxxxx, Lebanon, IN Nursing center ML#2-23
IN#780 Columbus Health & Rehab Center Xxxxxxxxxxx, Columbus, IN Nursing center ML#2-24
KY#278 Oakview Nursing & Rehab Center Xxxxxxxx, Xxxxxxx City, KY Nursing center XX#0-00
XX#000 Xxxxx Xxxxx Xxxxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxxx, XX Nursing center ML#2-26
ME#545 Eastside Rehab and Living Center Penobscot, Bangor, ME Nursing center ML#2-27
ME#549 Kennebunk Nursing Center York, Kennebunk, ME Nursing center ML#2-28
MA#508 Xxxxxxxx Skilled Nursing & Rehab Center Bristol, Fall River, MA Nursing center ML#2-29
MA#513 Hallmark Nursing & Rehab Center Bristol, New Bedford, MA Nursing center XX#0-00
XX#000 Xxxxxxxxx Nursing Home Worcester, Fitchburg, MA Nursing center XX#0-00
XX#000 Xxxxxxx Xxxxxxx Xx. Nursing & Rehab Essex, Swansea, MA Nursing center XX#0-00
XX#000 Xxxxxxxx Xx. Nursing & Rehab Center Franklin, Franlin, MA Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxx Xxxxxxx Xxxxx, Detroit, MI Hospital XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxx Xxxx Xxxxxxx, Kansas City, MO Hospital XX#0-00
XX#000 Xxxxxx Xxxxx Care Center Xxxxx, Las Vegas, NV Nursing center ML#2-36
NH#592 Greenbrier Terrace Healthcare Hillsborough, Nashua, NH Nursing center XX#0-00
XX#000 XxXxxxx Xxxxxxxxxx Xxxxxx Xxxxxx, Xxxxxx, XX Nursing center ML#2-38
NC#706 Guardian Care of Xxxxxxxxx Xxxxx, Henderson, NC Nursing center ML#2-39
NC#711 Guardian Care of Kinston Lenoir, Kinston, NC Nursing center ML#2-40
NC#726 Guardian Care of Xxxxxxxxx Xxxx Xxxxxxxxxx, Xxxxxxxxx Xxxx, XX Nursing center XX#0-00
XX#000 Xxxx Xxxxxxxxx Xxxxx & Nursing Center Coshocton, West Lafayette, OH Nursing center ML#2-42
OH#634 Xxxxxxxxx Xxxxxx & Xxxxx Xxxxxx Xxxxxxxx, Xxxxxxxxx, XX Nursing center ML#2-43
RI#1-224 Health Xxxxxx Nursing & Rehab Center Providence, East Providence, RI Nursing center ML#2-44
6
TN#822 Primacy Healthcare & Rehab Center Shelby, Memphis, TN Nursing center ML#2-45
TX#4-653 Vencor Hospital - Ft. Worth Southwest Tarrant, Ft. Worth, TX Hospital ML#2-46
TX#4-654 Vencor Hospital - Houston Northwest Xxxxxx, Houston, TX Hospital ML#2-47
TX#4-668 Vencor Hospital - Ft. Worth West Tarrant, Ft. Worth, TX Hospital ML#2-48
UT#690 Wasatch Valley Rehabilitation Salt Lake, Salt Lake City, UT Nursing center ML#2-49
VA#826 Harbour Pointe Medical & Rehab Center Suffolk, Suffolk, VA Nursing center XX#0-00
XX#000 Xxx Xxxxxx Xxxxxxx & Xxxxx Xxxxxx Princess Xxxx, Virginia Beach, VA Nursing center XX#0-00
XX#000 Xxxxxxxx Xxxxxxxxxx Xxxxxx Xxxxxx, Xxxxxxxx, XX Nursing center ML#2-52
WI#289 San Xxxx Medical & Rehab Center Xxxxx, Green Bay, WI Nursing center ML#2-53
WI#766 Colonial Manor Medical & Rehab Center Marathon, Wausau, WI Nursing center ML#2-54
INITIAL MASTER LEASE #3:
State/
------
Facility #: Facility Name: County, City, State Location: Facility Type: Index #:
----------- -------------- ----------------------------- -------------- --------
AL#824 Rehab & Healthcare Center of Mobile Mobile, Mobile, AL Nursing center ML#3-1
XX#000 Xxxxx Xxxxxxx Xxxxxx Xxxxxx Xxxx, Xxxxxx, XX Nursing center XX#0-0
XX#000 Xxxxxxxxxxx Xxxx Xxxxxx Xxxx, Xxxxxxxxxxx, XX Nursing center XX#0-0
XX#000 Xxxx Xxxxx Xxxxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxx, XX Nursing center XX#0-0
XX#0-000 XXX - Xxxxxx Xxxxxx Xxxxxx, Xxxx, XX Hospital ML#3-5
XX#000 Xxxxxxxx Xxxx Xxxxxx Xxxxx, Xxxxxxxx, XX Nursing center ML#3-6
CT#563 Camelot Nursing & Rehab Center New London, New London, CT Nursing center XX#0-0
XX#000 Xxxxxxx Xxxxxxxx Xxxxxxxxxx Xxxxxxxx, Xxxxxxx, CT Nursing center ML#3-8
FL#124 Healthcare & Rehab Center of Sanford Seminole, Sanford, FL Nursing center XX#0-0
XX#000 Xxxxxxxxxxx Xxxx Xxxxxx Xxxxxxxxxxxx, Xxxxx, XX Nursing center XX#0-00
XX#000/ Xxxxxxx Xxxxx Xxxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxx, XX Nursing center ML#3-11
181
7
FL#4-676 Vencor Hospital - Hollywood Broward, Hollywood, FL Hospital ML#3-12
FL#1220 Highland Pines Rehab Center Pinellas, Clearwater, FL Nursing center ML#3-13
GA#155 Savannah Rehab & Nursing Center Chatham, Savannah, GA Nursing center ML#3-14
GA#645 Specialty Care of Xxxxxxxx Xxxx, Marietta, GA Nursing center ML#3-15
ID#219 Emmett Rehabilitation & Healthcare Gem, Xxxxxx, ID Nursing center ML#3-16
IN#269 Meadowvale Health & Rehab Center Xxxxx, Bluffton, IN Nursing center ML#3-17
IN#694 Wedgewood Healthcare Center Xxxxx, Clarksville, IN Nursing center ML#3-18
KY#279 Cedars of Lebanon Nursing Center Marion, Lebanon, KY Nursing center XX#0-00
XX#000 Xxxxxxxxx Xxxxx Xxxxxxxxxx XxXxxx, Xxxxxxx, XX Nursing center ML#3-20
KY#782 Danville Centre for Health & Rehab Xxxxx, Danville, KY Nursing center ML#3-21
ME#544 Augusta Rehabilitation Center Kennebec, Augusta, ME Nursing center ML#3-22
ME#547 Xxxxxx Rehabilitation & Living Center Penobscot, Brewer, ME Nursing center XX#0-00
XX#000 Xxxxxxxx Xxxxx Xxxxxxxxx, Bangor, ME Nursing center ML#3-24
MA#506 Presentation Nursing & Rehab Center Suffolk, Brighton, MA Nursing center ML#3-25
MA#514 Sachem Nursing & Rehab Center Plymouth, East Bridgewater, MA Nursing center XX#0-00
XX#000 Xxxxxx & Xxxxxxxxx Alzheimer Center Norfolk, Wellesley, MA Nursing center XX#0-00
XX#000 Xxxxx Xxxxxxx Xxxxxxxxx, Xxxxxxxxx, XX Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxx Xxxxxxxxxx Essex, Peabody, MA Hospital XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxx Xxxxxxx, Boston, MA Hospital ML#3-30
MI#4-675 Vencor Hospital - Detroit Xxxxx, Lincoln, MI Hospital XX#0-00
XX#0-000 XXX - Xxx Xxxxx Hospital Xxxxx, Las Vegas, NV Nursing center ML#3-32
NC#116 Xxxxxxxxx Rehab & Healthcare Center Durham, Durham, NC Nursing center ML#3-33
NC#143 Raleigh Rehab & Healthcare Center Wake, Raleigh, NC Nursing center ML#3-34
NC#307 Lincoln Nursing Center Lincoln, Lincoln, NC Nursing center ML#3-35
NC#713 Guardian Care of Zebulon Wake, Zebulon, NC Nursing center ML#3-36
NC#4-662 Vencor Hospital - Greensboro Guilford, Greensboro, NC Hospital ML#3-37
8
OR#453 Medford Rehab & Healthcare Center Xxxxxxx, Medford, OR Nursing center XX#0-00
XX#0-000 Xxxxxxxxxx Nursing & Rehab Center Berks, Reading, PA Nursing center ML#3-39
TN#182 Xxxxxxx Rehab & Nursing Center Shelby, Cordova, TN Nursing center ML#3-40
TX#4-635 Vencor Hospital - San Antonio Bexar, San Antonio, TX Hospital ML#3-41
TX#4-660 Vencor Hospital - Mansfield Tarrant, Mansfield, TX Hospital ML#3-42
UT#230 Crosslands Rehab & Health Xxxx Xxxxxx Xxxx Xxxx, Xxxx Xxxx Xxxx, XX Nursing center ML#3-43
WA#461 Edmonds Rehab & Healthcare Center Snohomish, Edmonds, WA Nursing center XX#0-00
XX#000 Xxxxxxxxx Xxxx Xxxxxx Xxxxxxxxx, Xxxxxx, XX Nursing center ML#3-45
WI#773 Mt. Carmel Medical & Rehab Center Racine, Burlington, WI Nursing center ML#3-46
WI#774 Mt. Carmel Medical & Rehab Center Milwaukee, Milwaukee, WI Nursing center ML#3-47
INITIAL MASTER LEASE #4:
State/
----------
Facility#: Facility Name: County, City, State Location: Facility Type: Index #:
---------- -------------- ----------------------------- -------------- --------
AL#791 Rehab & Healthcare Center of Huntsville Madison, Huntsville, AL Nursing center ML#4-1
AZ#853 Kachina Point Health Care & Rehab Yavapai, Sedona, AZ Nursing center XX#0-0
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxx Pima, Tuscon, AZ Hospital XX#0-0
XX#000 Xxxxxx Xxxxxxx Health Care & Rehab San Xxxxxxx, Stockton, CA Nursing center XX#0-0
XX#000/ Xxxxxxx Xxxxxx Nursing & Rehab Center San Diego, San Marcos, CA Nursing center ML#4-5
148
CO#859 Castle Garden Care Center Xxxxx, Northglenn, CO Nursing center ML#4-6
CO#4-665 Vencor Hospital - Denver Denver, Denver, CO Hospital ML#4-7
CT#566 Windsor Rehab & Healthcare Center Hartford, Windsor, CT Nursing center XX#0-0
XX#0000 Xxxxxxxxx Xxxxxxx Health Center, Inc. Fairfield, Stamford, CT Nursing center XX#0-0
XX#000 Xxxxxxxx Xxxx Xxxxx Xxxxxx - Xx. Xxxxxx Xxx, Ft. Xxxxxx, FL Nursing center ML#4-10
FL#637 Evergreen Xxxxx Health & Rehab Hernando, Springhill, FL Nursing center XX#0-00
XX#0000 Xxxxx Xxxxxxx Xxxxx and Nursing Center Broward, Pompano Beach, FL Nursing center ML#4-12
9
FL#1232 Pompano Rehab/Nursing Center Broward, Pompano Beach, FL Nursing center ML#4-13
FL#1233 Abbey Rehab & Nursing Center Pinellas, St. Petersburg, FL Nursing center ML#4-14
FL#4-645/ Vencor Hospital - Ft. Lauderdale Broward, Ft. Lauderdale, FL Hospital ML#4-15
46
GA#1238 Xxxxxx Nursing Center De Xxxx, Tucker, GA Nursing center XX#0-00
XX#000 Xxxxxx Xxxx Xxxxxx Xxxxx, Xxxxxx, XX Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxx Xxxxx Xxxx, Chicago, IL Hospital ML#4-18
IN#131 Vencor Corydon Nursing Care Center Xxxxxxxx, Xxxxxxx, IN Nursing center ML#4-19
IN#209 Valley View Health Care Center Elkhart, Elkhart, IN Nursing center ML#4-20
IN#213 Wildwood Healthcare Center Marion, Indianapolis, IN Nursing center ML#4-21
IN#290 Bremen Healthcare Center Xxxxxxxx, Bremen, IN Nursing center ML#4-22
KY#277 Rosewood Health Care Center Xxxxxx, Bowling Green, KY Nursing center ML#4-23
KY#785 Hillcrest Health Care Center Davies, Owensboro, KY Nursing center XX#0-00
XX#000 Xxxxxxxx Xxxxxxx Health Care Facility Xxxxxx, Elizabethtown, KY Nursing center XX#0-00
XX#000 Xxxxxxxxxxx Health Care Center Xxxxxx, Harrodsburg, KY Nursing center ML#4-26
LA#4-666 Vencor Hospital - New Orleans Orleans Parish, New Orleans, LA Hospital ML#4-27
ME#546 Winship Green Nursing Center Sagadahoc, Bath, ME Nursing center ML#4-28
MA#503 Xxxxxxx Xxxxx Nursing & Rehab Center Suffolk, Newburyport, MA Nursing center ML#4-29
MA#517 Oakwood Rehab & Nursing Center Worcester, Webster, MA Nursing center ML#4-30
MA#523 Star of Xxxxx Nursing & Xxxxx/Xxx. Xxxxxx Xxxxxxx, Xxxx Xxxxxxx, XX Nursing center XX#0-00
XX#000 Xxxxxxxx Xxxxxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxx, XX Nursing center ML#4-32
MA#542 Den-Mar Rehab & Nursing Center Essex, Rockport, MA Nursing center XX#0-00
XX#000 Xxxxxxx Xxxxx Xx. Nursing & Rehab Plymouth, Brockton, MA Nursing center XX#0-00
XX#000 Xxxxx Xxxxxxxxxx Xxxxx & Nursing Center Berkshire, Gt. Barrington, MA Nursing center ML#4-35
NE#746 Homestead Health Care & Rehab Center Lancaster, Lincoln, NE Nursing center ML#4-36
NM#4-664 Vencor Hospital - Albuquerque Bernalillo, Albuquerque, NM Nursing center ML#4-37
10
NC#146 Xxxx Xxxxx Health Care Center Durham, Durham, NC Nursing center ML#4-38
NC#723 Guardian Care of Rocky Mount Xxxx, Rocky Mount, NC Nursing center ML#4-39
OH#569 Chillicothe Nursing & Rehab Center Xxxx, Chillicothe, OH Nursing center XX#0-00
XX#000 Xxxxxxxxxxxx Nursing & Rehab Center Fairfield, Pickerington, OH Nursing center ML#4-41
OH#571 Xxxxx Health Care Center Hocking, Logan, OH Nursing center ML#4-42
OH#802 Bridgepark Center for Rehab & Nursing Summit, Akron, OH Nursing center ML#4-43
Services
PA#4-614 Vencor Hospital - Philadelphia Philadelphia, Philadelphia, PA Hospital XX#0-00
XX#0-000 Xxx Xxxx Nursing & Rehab Center Providence, Pawtucket, RI Nursing center XX#0-00
XX#0-000 Xxx Xxxxx Xxxxx Xxxxx, Xxx Xxxxxxx, XX Nursing center ML#4-46
TX#4-685 Vencor Hospital - Houston Xxxxxx, Houston, TX Hospital XX#0-00
XX#000 Xxxxxxxxx Xxxxxxx Xxxxxxxxxx, Xxxxxxxxxx, XX Nursing center XX#0-00
XX#0-000 Xxxxxx Xxxxxxxx - Xxxxxxxxx Xxxxxxxxx, Arlington, VA Hospital XX#0-00
XX#000 Xxxxxxxxxx Health Care & Rehab Svc. Whatcom, Bellingham, WA Nursing center ML#4-50
WI#765 Eastview Medical & Rehab Center Langlade, Antigo, WI Nursing center ML#4-51
WI#771 Xxxxxxx Park Medical & Rehab Center Marathon, Schofield, WI Nursing center XX#0-00
XX#000 Xxxxx Xxxxxxx Wyoming Healthcare & Rehab Carbon, Rawlins, WY Nursing center ML#4-53
OTHER LEASED PROPERTY (6):
(against which a leasehold mortgage will be filed on the Closing Date)
State/
----------
Facility#: Facility Name: County, City, State Location: Facility Type: Index #:
---------- -------------- ----------------------------- -------------- --------
XX#0-000 Xxxxxx Xxxxxxxx Xxxxx Xxxxxxxxxxxx, Xxxxx, XX Hospital FP#1
GA#1-236 Warner Robins Rehabilitation and Nursing Houston, Warner Robins, GA Nursing center FP#2
Center
IN#199 Vencor at Sellersburg Clark, Clark, IN Nursing center FP#3
XX#000 Xxxxxxx Xxxx Xxxxxx Xxxxx, Xxxxxxx, XX Nursing center FP#4
11
KY#781 Xxxxxxxx Xxxx Xxxxxx Xxxx Xxxxxxxxx, Xxxxxxxxxx, XX Nursing center FP#5
NC#722 Guardian Care of Kenansville Duplin, Kennansville, NC Nursing center FP#6
Third Party Leases (including all Other Leased Property):
State/
----------
Facility#: Facility Name: County, City, State Location: Facility Type: Status:
---------- -------------- ----------------------------- -------------- -------
AL#1-227 Big Spring Specialty Care Center Madison, Huntsville, AL Nursing center
AZ#796 Hacienda Rehabilitation and Care Center Cochise, Sierra Vista, AZ Nursing center
CA#205 Xxxxxxxx Xxxx Xxxxxx Xxxxxxx, Xxxxxxxxx, XX Nursing center
XX#000 Xxxx Xxxxxx Xxxxxxxxxx Xxxxxx Xxxxx, Xxxx Xxxxxx, XX Nursing center Non-operational
XX#000 Xxxxx Xxxx Xxxxxxxxxx Xxxxxx Xxxxx Xxxx, Xxxxx Xxxx, XX Nursing center
CA#909 Golden Gate Health Care Center San Francisco, San Francisco, CA Nursing center
CA#907 Xxxxx Xxxxxx Xxxxxx Xxxx Xxxxxx Xxxxx, Xxx Xxxxxx, XX Nursing center Subleased
CA#911 Victorian Healthcare Center San Francisco, San Francisco, CA Nursing center
CA#3-298 XxxXxxxxx Xxxx Xxxxxx Xxxxxx, Xxxx Xxxx, XX Nursing center Subleased
CA#3-299 XxxXxxxxx Xxxxxx Xxxx Xxxxxx Xxxx, Xxxxxxxxxx, XX Nursing center Subleased
XX#000 Xxxxx Xxxx Xxxxxx Xxxxxx, Xxxxxx, XX Nursing center
XX#000 Xxx Xxxx xx Xxxx Xxxxxxxxx, Xxxx Xxxx, XX Nursing center
FL#4-640 Vencor Hospital - Tampa Hillsborough, Tampa, FL Hospital
GA#4-670 Vencor Hospital - Atlanta Xxxxxxx, Atlanta, GA Hospital
GA#1-213 Eastview Nursing Home Xxxx, Macon, GA Nursing center
XX#0-000 Xxxxxxx Health Care Houston, Warner Robins, GA Nursing center
XX#0-000 XxxxxxxXxxx xx Xxxxxxx Xxxxxxx, Xxxx Xxxx, XX Nursing center
GA#1-236 Warner Robins Rehabilitation and Nursing Houston, Warner Robins, GA Nursing center
Center
12
IL#4-667 Vencor Hospital - Chicago Central Xxxx, Chicago, IL Hospital
IN#194 Vencor at Eagle Creek Marion, Indianapolis, IN Nursing center
IN#199 Vencor at Sellersburg Xxxxx, Sellersburg, IN Nursing center
IN#204 Angel River Health and Rehabilitation Xxxxxxx, Newburgh, IN Nursing center
IN#224 Regency Place of Xxxxxxxxx Xxxxxx, Indianapolis, IN Nursing center
IN#232 Regency Place of Xxxx Lake, Dyer, IN Nursing center
IN#240 Regency Place of Greenwood Xxxxxxx, Greenwood, IN Nursing center
IN#287 Crestview Xxxx, Vincennes, IN Nursing center
IN#288 Indian Creek Health and Rehabilitation Xxxxxxxx, Xxxxxxx, IN Nursing center
Center
IN#296 Chalet Village Health and Rehabilitation Adams, Berne, IN Nursing center
Center
IN#402 Regency Place of Fort Xxxxx Xxxxx, Ft. Xxxxx, IN Nursing center
IN#403 Regency Place of Greenfield Xxxxxxx, Greenfield, IN Nursing center
IN#404 Regency Place of Lafayette Tippecanoe, Lafayette, IN Nursing center
IN#405 Regency Place of South Bend St. Xxxxxx, South Bend, IN Nursing center
IN#408 Colonial Oaks Health Care Center Grant, Marion, IN Nursing center
IN#4-672 Vencor Hospital - Indianapolis South Xxxxxxx, Greenwood, IN Hospital
IN#3-305 University Nursing Center Grant, Upland, IN Nursing center Subleased
XX#000 Xxxxxxx Xxxx Xxxxxx Xxxxx, Xxxxxxx, XX Nursing center
KY#271 Heritage Manor Health Care Center Xxxxxx, Mayfield, KY Nursing center
KY#781 Xxxxxxxx Xxxx Xxxxxx Xxxx Xxxxxxxxx, Xxxxxxxxxx, XX Nursing center
XX#000 Xxxxxxxxxx Xxxxxxx Health Care Center XxXxxxxxx, Paducah, KY Nursing center
KY#1-225 Hermitage Nursing and Rehabilitation Center Daviess, Owensboro, KY Nursing center
LA#1-235 Irving Place Rehabilitation and Nursing Caddo, Shreveport, LA Nursing center
Center
MA#531 Xxxxxxx House Nursing Home Bristol, Fairhaven, MA Nursing center
MA#540 Brook Farm Rehabilitation and Nursing Center Suffolk, West Roxbury, MA Nursing center
13
MA#541 Westborough Health Care Center Worcester, Westborough, MA Nursing center
MI#3-300 Autumnwood of XxXxxx Missaukee, McBain, MI Nursing center Subleased
MI#3-301 Autumnwood of Deckerville Sanilac, Deckerville, MI Nursing center Subleased
MS#227 Xxxxxx County Care Inn Xxxxxx, Corinth, MS Nursing center
XX#0-000 Xxxx Xxxxx Xxxxxxx Xxxx Xxxx, Xxxx Xxxxx, XX Nursing center Subleased
MO#861 Blue Hills Living Center Xxxxxxx, Kansas City, MO Nursing center
MO#3-263 Ozark Mountain Regional Health Stone, Crane, MO Nursing center Managed by
third party
MO#3-265 Table Rock Health Care Center Stone, Xxxxxxxxxx City, MO Nursing center Managed by
third party
XX#0-000 Xxxxx Xxxx Xxxxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx Xxxx, XX Nursing center Managed by
third party
MT#434 Xxxxxxxxxx Health and Rehabilitation Center Park, Livingston, MT Nursing center
XX#0-000 Xxxxxxxxx Senior Care Center San Xxxxxx, Las Vegas, NM Nursing center Subleased
NC#193 Rehabilitation and Healthcare Center of Alamance, Graham, NC Nursing center
Alamance
NC#717 Guardian Care of Scotland Neck Halifax, Scotland Neck, NC Nursing center
NC#718 Guardian Care of Ahoskie Hertford, Ahoskie, NC Nursing center
NC#722 Guardian Care of Kenansville Duplin, Kenansville, NC Nursing center
OH#237 Newark Healthcare Center Licking, Newark, OH Nursing center
XX#000 Xxxxxxxxxx Xxxxxxx Xxxxx Xxxxx, Xxxxxxxxxx, XX Nursing center
XX#000 Xxxxxxxxx Xxxxxx Xxxx Xxxxxx Xxxxxx, Xxxxxx, XX Nursing center
OH#1-229 The LakeMed Nursing and Rehabilitation Lake, Painesville, OH Nursing center
Center
PA#1-223 PersonaCare at Xxxxxxxx Xxxxxxxxxxx, Xxxxxx, XX Nursing center
TN#171 Pine Xxxxxxx Healthcare and Hardeman, Bolivar, TN Nursing center
Rehabilitation Center
14
TN#174 Camden Healthcare and Rehabilitation Center Benton, Camden, TN Nursing center
TN#175 Jefferson City Health and Rehabilitation Xxxxxxxxx, Xxxxxxxxx City, TN Nursing center
Center
TN#177 Xxxxxx Healthcare Center Loudon, Loudon, TN Nursing center
TN#178 Xxxxxx Xxxxx Rehabilitation and Healthcare Shelby, Memphis TN Nursing center
Center
TN#179 Huntingdon Health and Rehabilitation Center Xxxxxxx, Huntingdon, TN Nursing center
TN#183 Xxxxxx Healthcare and Rehabilitation Center Landerdale, Ripley, TN Nursing center
TN#184 Greystone Health Care Center Xxxxxxxx, Blountville, TN Nursing center
TN#187 Maryville Healthcare and Rehabilitation Xxxxxx, Maryville, TN Nursing center
Center
XX#000 Xxxxxxxx Xxxxxxxxxx Xxxxxx Xxxxxx, Xxxxxxxxx, XX Nursing center
XX#000 Xxxxxxxxxx Xxxxxx Xxxx Xxxxxx Xxxx, Xxxxxxxxx, XX Nursing center
XX#000 Xxxxx Xxxxxx Xxxxxx Xxxx Xxxxxx Xxxxx, Xxxxxxxx, XX Nursing center Subleased
TX#4-657 Vencor Hospital - Bay Area-Houston Xxxxxx, Pasadena, TX Hospital
TX#4-686 Vencor Hospital - Dallas East Dallas, Dallas TX Hospital
TX#880 Four States Care Center Bowie, Texarkana, TX Nursing center
XX#0-000 Xxxxxxxx Xxxxxxx Xxxxxxxxx Xxxxx, Xxx Xxxxxxx, XX Nursing center
XX#0-000 Xxx Xxxxxxx Xxxx, Xxxxxx Xxxxxxx, XX Nursing center Subleased
XX#0-000 Xxxxxxx Xxxxx Xxxxxx, Xxxxxxxxxxxx, XX Nursing center Subleased
XX#0-000 Xxxxxxxxx Xxxxxxxxx Xxxxxxx, Xxxxxxx, XX Nursing center Subleased
TX#3-841 Lakerridge Rehab & Nsg. Center Lubbock, Lubbock, TX Nursing center Subleased
UT#419 Salt Lake Nursing and Xxxxxxxxxxxxxx Xxxxxx Xxxx Xxxx, Xxxx Xxxx Xxxx, XX Nursing center
WI#197 Oshkosh Medical & Rehabilitation Center Winnebago, Oshkosh, WI Nursing center
XX#0-000 Xxxxxxxxx Xxxxxxx Nursing and Dane, Middleton, WI Nursing center
Rehabilitation Center
15
SCHEDULE 5
MANAGEMENT CONTRACTS
--------------------
---------------------------------------------------------------------------------------------------------------
FACILITY AGREEMENT MANAGER
---------------------------------------------------------------------------------------------------------------
169 Management Agreement dated as of Vencor Nursing Centers East, L.L.C.
Menorah House January 31, 1990
0000 Xxxxxxx Xxxx Xxxx. X
Xxxx Xxxxx, XX
---------------------------------------------------------------------------------------------------------------
815 Management Agreement dated as of Vencor Nursing Centers East, L.L.C.
Lago Vista Care Center January 31, 1990
0000 Xxxxxx Xxxxxxxxx
Xxxxxx Xxxxx, XX
---------------------------------------------------------------------------------------------------------------
912 Management Agreement dated as of Vencor Operating, Inc.
The Arbors Healthcare Center March 6, 2000
00 X. Xxxxxxx 000
Xxxx Xxxxx, XX 00000
---------------------------------------------------------------------------------------------------------------
913 Management Agreement dated as of Vencor Operating, Inc.
Los Xxxxx Health Care Center March 6, 2000
000 X. Xxxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
---------------------------------------------------------------------------------------------------------------
914 Management Agreement dated as of Vencor Operating, Inc.
Pueblo Norte Nursing Center March 6, 2000
0000 X. Xxxx Xxxxxx
Xxxx Xxx, XX 00000
---------------------------------------------------------------------------------------------------------------
915 Management Agreement dated as of Vencor Operating, Inc.
Rio Verde Health Care Center March 6, 2000
000 X. Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
---------------------------------------------------------------------------------------------------------------
920 Management Agreement dated as of Vencor Nursing Centers East, L.L.C.
Marietta Ctr for Hlth & Rehab July 12, 1983
000 Xxxxxxxx Xxxxxx
Xxxxxxxx, XX
---------------------------------------------------------------------------------------------------------------
926 Management Agreement dated as of Vencor Nursing Centers West, L.L.C.
Nineteenth Avenue HCC February 29, 1988
2043 - 00/xx/ Xxxxxx
Xxx Xxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------------
930 Management Agreement dated as of Vencor Operating, Inc.
Peppertree Square March 16, 2000
0000 Xxxxxx Xxxx Xxxxx
Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------------
931 Management Agreement dated as of Vencor Operating, Inc.
Safford Care Center March 16, 2000
0000 Xxxxxx Xxxx Xxxxx
Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------------
1
---------------------------------------------------------------------------------------------------------
FACILITY AGREEMENT MANAGER
---------------------------------------------------------------------------------------------------------
932 Management Agreement dated as of Vencor Operating, Inc.
Village Catered Care March 16, 2000
0000 Xxx Xxxxxxx Xxxxxx
Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------
934 Management Agreement dated as of Vencor Operating, Inc.
Xxxxxxx Xxxxx March 16, 2000
0000 Xxx Xxxxxxx Xxxxxx
Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------
935 Management Agreement dated as of Vencor Operating, Inc.
Kendallville Manor LLC Ctr March 6, 2000
0000 X. Xxxxxxx Xxxxxx
Kendallville, IN
---------------------------------------------------------------------------------------------------------
936 Management Agreement dated as of Vencor Operating, Inc.
Wellington Manor March 6, 2000
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
937 Management Agreement dated as of Vencor Operating, Inc.
Cloverleaf of Knightsville March 6, 2000
0000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
949 Management Agreement dated as of Vencor Nursing Centers East, L.L.C.
Ledgewood Rehab. & Nsg. 1985
00 Xxxxxxx Xxxxxx
Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------
950 Management Agreement dated as of Vencor Nursing Centers West, L.L.C.
Salemhaven Nursing Home April 21, 1983
00 Xxxxxxxxx Xxxxx
Xxxxx, XX
---------------------------------------------------------------------------------------------------------
951 Management Agreement dated as of Vencor Operating, Inc.
Xxxxxxxx Xxxxx March 16, 2000
0000 Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xx
---------------------------------------------------------------------------------------------------------
952 Management Agreement dated as of Vencor Operating, Inc.
Terrace Lake Village March 16, 2000
000 Xxxxxxx Xxxx Xxxxx
Xxxxxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
953 Management Agreement dated as of Vencor Operating, Inc.
Ridgewood Health Care Ctr. March 16, 2000
000 Xxxxxxx Xxxx
Xxxxxx, XX
---------------------------------------------------------------------------------------------------------
954 Management Agreement dated as of Vencor Operating, Inc.
Holiday Manor March 16, 2000
000 X. 0/xx/ Xxxxxx
Xxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
2
---------------------------------------------------------------------------------------------------------
FACILITY AGREEMENT MANAGER
---------------------------------------------------------------------------------------------------------
956 Management Agreement dated as of Vencor Operating, Inc.
Owensville Convalescent Ctr. March 16, 2000
Hwy, 165 West, Box 369
Owensville, IN
---------------------------------------------------------------------------------------------------------
957 Management Agreement dated as of Vencor Operating, Inc.
Willow Manor Conv. Ctr. March 16, 2000
0000 Xxxxxx Xxxxxx
Vincennes, IN.
---------------------------------------------------------------------------------------------------------
961 Management Agreement dated as of Vencor Operating, Inc.
Hertigate Plaza Nsg. Center March 6, 2000
000 X. 00/xx/ Xxxxxx
Xxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
962 Management Agreement dated as of Vencor Operating, Inc.
Pine Grove Nursing Center March 6, 2000
XX 0 Xxx 0000
Center, TX
---------------------------------------------------------------------------------------------------------
963 Management Agreement dated as of Vencor Operating, Inc.
Pine Haven Care Center March 6, 2000
0000 X. Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
964 Management Agreement dated as of Vencor Operating, Inc.
Pleasant Manor Living Center March 6, 2000
0000 X. Xxxxxxx 00-X
Xxxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
965 Management Agreement dated as of Vencor Operating, Inc.
Reunion Plaza Sr. Care & Ret. March 6, 2000
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000
---------------------------------------------------------------------------------------------------------
966 Management Agreement dated as of Vencor Operating, Inc.
South Place Nursing Center March 6, 2000
000 Xxxxxx Xxxx
Xxxxxx, Xxxxx
---------------------------------------------------------------------------------------------------------
967 Management Agreement dated as of Vencor Operating, Inc.
West Place Nursing Center March 6, 0000
Xxx, 00 Xxxx Xxx 000
Xxxxxx, XX
---------------------------------------------------------------------------------------------------------
968 Management Agreement dated as of Vencor Operating, Inc.
Colonial Pines Healthcare, March 6, 2000
Ctr.
0000 XX 0000
Xxx Xxxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
3
---------------------------------------------------------------------------------------------------------
FACILITY AGREEMENT MANAGER
---------------------------------------------------------------------------------------------------------
978 Management Agreement dated as of Vencor Nursing Centers East, L.L.C.
North Shore Living Center January 31, 1990
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------
981 Foothill Skilled Nursing Vencor Nursing Centers West, L.L.C.
Foothill Nsg. & Rehab Ctr. Facility Management Agreement
000 Xxxx Xxx Xxxxxx dated as of 0000
Xxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
983 Long Term Care Facility Vencor Nursing Centers East, L.L.C.
Xxxxx House Nrsg. Ctr. Management Agreement dated as of
00 Xxxxxxxx Xxxxx July 1, 0000
Xxxxxxxx, XX
---------------------------------------------------------------------------------------------------------
990 Management Agreement dated as of Vencor Nursing Centers East, L.L.C.
Jo Xxxxx Xxxxx Conv. Center January 31, 1990
0000 Xxxxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX
---------------------------------------------------------------------------------------------------------
992 Agreement to Provide Management Vencor Nursing Centers West, L.L.C.
Holladay Healthcare Center Services to a Health Care
0000 Xxxxx Xxxxxxxx Xxxx. Facility dated as of September
Salt Lake City, UT 1, 1985
---------------------------------------------------------------------------------------------------------
995 Agreement to Provide Management Vencor Nursing Centers East, L.L.C.
Starr Farm Nursing Center Services to a Health Care
00 Xxxxx Xxxx Xxxx Facility dated as of December
Burlington, VT 30, 1986
---------------------------------------------------------------------------------------------------------
See attached list Letter Agreement with Omega Vencor Operating, Inc.
Healthcare Investors, Inc. and
affiliates dated as of March 26,
2000
---------------------------------------------------------------------------------------------------------
4
List of Facilities Governed by Letter Agreements with
-----------------------------------------------------
Omega Healthcare Investors, Inc. and Affiliates
-----------------------------------------------
(The) Arbors Health Care Center
Los Xxxxx Health Care Center
Pueblo Norte Nursing Center
Rio Verde Healthcare Center
Cloverleaf of Knightsville
Kendallville Manor
Wellington Manor
Colonial Pines
Heritage Plaza
Pine Grove Nursing Center
Pine Haven Care Center
Pleasant Manor Living Center
Reunion Plaza
South Place Nursing Center
West Place
Willow Manor Convalescent Center
Owensville
Holiday Manor
Village Catered Care (Xxxxxxx)
Xxxxxxx Xxxxx
Peppertree Square (Safford)
Safford Care Center
Terrace Lake Village (Xxxxxxxx)
Xxxxxxxx Xxxxx
Ridgewood Health Care Center
5
SCHEDULE 6
PERMITTED INVESTMENTS
---------------------
-----------------------------------------------------------------------------------------------------------------
HOLDER INVESTMENT
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. Promissory Notes evidencing loans made by Vencor Operating, Inc. and/or
Vencor, Inc. to certain current and former officers of Vencor not
exceeding $16,000,000 aggregate amount
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. $500,000 Promissory Note made by HealthEssentials Solutions, Inc. due
February 25, 2001*
-----------------------------------------------------------------------------------------------------------------
First Healthcare Corporation $3,965,000 Promissory Note made by Foothill Nursing Company Partnership
(assigned to Vencor Operating, due March 31, 2001 (as the same may be extended from time to time provided
Inc.) that the aggregate outstanding principal amount does exceed $3,965,000)
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 7,500 shares in Ledgewood Health Care Corporation, a Massachusetts
corporation
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 1,933,901 shares in Lectus Inc., a California corporation
-----------------------------------------------------------------------------------------------------------------
Vencor Holdings, L.L.C. 1,234,568 shares in Atria Communities, Inc., a Delaware corporation
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 50,000 shares in HealthEssentials Solutions, Inc., a Delaware corporation
-----------------------------------------------------------------------------------------------------------------
Community Psychiatric Centers 1,385,076 shares of common stock and 4,350,712 shares of Series A
Properties, Incorporated Preferred in Behavioral Healthcare Corporation, a Delaware corporation
-----------------------------------------------------------------------------------------------------------------
Community Psychiatric Centers of 1,112,919 shares of common stock and 1,299,817 shares of Series A
California Preferred in Behavioral Healthcare Corporation, a Delaware corporation
-----------------------------------------------------------------------------------------------------------------
Interamericana Health Care Group 246,900 shares of common stock in Behavioral Healthcare Corporation, a
Delaware corporation
-----------------------------------------------------------------------------------------------------------------
Transitional Hospitals Corporation 3,248,405 shares of common stock in Behavioral Healthcare Corporation, a
Delaware corporation
-----------------------------------------------------------------------------------------------------------------
C.P.C. of Louisiana, Inc. 6,700 shares of common stock and 838 shares of Series A Preferred in
Behavioral Healthcare Corporation, a Delaware corporation
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 50% general partnership interest in Fox Hill Village Partnership, a
Massachusetts general partnership
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 50% general partnership interest in Hillhaven-MSC
-----------------------------------------------------------------------------------------------------------------
* Vencor is pursuing collection.
1
-----------------------------------------------------------------------------------------------------------------
Partnership, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 50% general partnership interest in Starr Farm Partnership, a Vermont
partnership
-----------------------------------------------------------------------------------------------------------------
Advanced Infusion Systems, Inc. Approximately 46% general partnership interest in VNA/CPS Pharmaceutical
Services, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Vencare, Inc. 50% membership interest in MedAssure, L.L.C., a Kentucky limited liability
company
-----------------------------------------------------------------------------------------------------------------
Advanced Infusion Systems, Inc. 51% general partnership interest in California Respiratory Care
Partnership, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. 50% general partnership interest in Foothill Nursing Company Partnership,
a California general partnership
-----------------------------------------------------------------------------------------------------------------
Advanced Infusion Systems, Inc. Approximately 50.99% general partnership interest in Pharmaceutical
Infusion Therapy, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Advanced Infusion Systems, Inc. 50.01% general partnership interest in Visiting Nurse Advanced Infusion
Systems - Anaheim, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Advanced Infusion Systems, Inc. 51.01% general partnership interest in Visiting Nurse Advanced Infusion
Systems - Colton, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Advanced Infusion Systems, Inc. 51.01% general partnership interest in Visiting Nurse Advanced Infusion
Systems - Newbury Park, a California general partnership
-----------------------------------------------------------------------------------------------------------------
Northridge Surgery Center 38% general partnership interest in Northridge Surgery Center, Ltd., a
Development, Ltd. California limited partnership
-----------------------------------------------------------------------------------------------------------------
Helian ASC of Northridge, Inc. 13% general partnership interest in Northridge Surgery Center, Ltd., a
California limited partnership
-----------------------------------------------------------------------------------------------------------------
Helian Health Group, Inc. 13.5% limited partnership interest in Northridge Surgery Center, Ltd., a
California limited partnership
-----------------------------------------------------------------------------------------------------------------
Helian ASC of Northridge, Inc. 6% limited partnership interest in Northridge Surgery Center, Ltd., a
California limited partnership
-----------------------------------------------------------------------------------------------------------------
MedEquities, Inc. 43% general partnership interest in Northridge Surgery Center Development,
Ltd., a California limited partnership
-----------------------------------------------------------------------------------------------------------------
Helian Recovery Corporation 58% general partnership interest in Recovery Inn of Menlo Park, L.P., a
California limited partnership
-----------------------------------------------------------------------------------------------------------------
Recovery Inns of America, Inc. 12% limited partnership interest in Recovery Inn of Menlo Park, L.P., a
California limited partnership
-----------------------------------------------------------------------------------------------------------------
* Vencor is pursuing collection.
2
-----------------------------------------------------------------------------------------------------------------
Helian Recovery Corporation Approximately 27.6% limited partnership interest in Recovery Inn of Menlo
Park, L.P., a California limited partnership
-----------------------------------------------------------------------------------------------------------------
Vencor Operating, Inc. $87,136.65 Promissory Note made by XxxXxx.xxx, Inc.
-----------------------------------------------------------------------------------------------------------------
* Vencor is pursuing collection.
3
SCHEDULE 7
LOCAL REAL ESTATE COUNSEL
-------------------------
-----------------------------------------------------------------------------------------------
STATE LAW FIRM
-----------------------------------------------------------------------------------------------
Alabama Sirote & Permutt
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
-----------------------------------------------------------------------------------------------
Arizona Xxxxxxxxxxx Xxxxxx Xxxxxxxx Xxxxx & Xxxxxx, PLC
0000 X. Xxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000-0000
-----------------------------------------------------------------------------------------------
California Manatt, Xxxxxx and Xxxxxxxx, LLP
00000 Xxxx Xxxxxxx Xxxxxxxxx
Xxx Xxxxxxx, XX 00000-0000
-----------------------------------------------------------------------------------------------
Colorado Xxxxx & Xxxxxxxxx LLP
000 Xxxx 00/xx/ Xxxxxx, Xxxxx 0000
Xxxxxx, XX 00000
-----------------------------------------------------------------------------------------------
Connecticut Murtha, Cullina, Xxxxxxx and Xxxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxx, XX 00000
-----------------------------------------------------------------------------------------------
Florida Boyd, Lindsey, Xxxxxxxx & Branch
0000 Xxxxxxxx Xxxxx Xxxx
Xxxxxxxxxxx, XX 00000
-----------------------------------------------------------------------------------------------
Xxxxxxx Xxxxxx, Golden & Xxxxxxx LLP
One Atlantic Center, 0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
-----------------------------------------------------------------------------------------------
Idaho Xxxxxxxx Xxxx & Xxxxxx, X.X.X.
X.X. Xxxx Xxxxx, 0/xx/ Xxxxx
000 X. Xxxxxxx Xxxx.
Xxxx Xxxxxx Xxx 0000
Xxxxx, Xxxxx 00000
-----------------------------------------------------------------------------------------------
Illinois Winston & Xxxxxx
00 X. Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
-----------------------------------------------------------------------------------------------
Indiana Xxxxx XxXxxxx Xxxxxxxxx & Xxxxxxxx, LLP
Xxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxxx, XX 00000-0000
-----------------------------------------------------------------------------------------------
Kentucky Frost, Xxxxx & Xxxx
000 Xxxx Xxxxxx Xxxxxx, 00/xx/ Xxxxx
Xxxxxxxxxx, XX 00000-0000
-----------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------
Louisiana Kean, Miller, Hawthorne, X'Xxxxxx, XxXxxxx &
Xxxxxx, L.L.P.
00/xx/ Xxxxx, Xxx Xxxxxxxx Xxxxx
Xxxxx Xxxxx, Xxxxxxxxx 00000
-----------------------------------------------------------------------------------------------
Maine Verrill & Xxxx, LLP
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000-00000
-----------------------------------------------------------------------------------------------
Massachusetts Mintz, Levin, Cohn, Ferris, Glovsky & Popeo,
P.C.
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
-----------------------------------------------------------------------------------------------
Michigan Xxxxxxxx Xxxxxx Xxxxxxxx & Xxxx
0000 Xxxxx Xxxxxxxx Xxxxxxxx
Xxxxxxx, XX 00000-0000
-----------------------------------------------------------------------------------------------
Minnesota Orbovich & Gartner
Xxxxxxxx Xxxx Xxxxxxxx, Xxxxx 000
000 Xx. Xxxxx Xxxxxx
Xx. Xxxx, Xxxxxxxxx 00000
-----------------------------------------------------------------------------------------------
Missouri Xxxxxxxxx Xxxxxxxx LLP
Xxx Xxxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xx. Xxxxx, Xxxxxxxx 00000-0000
-----------------------------------------------------------------------------------------------
Montana Xxxxxxx, Haughey, Hanson, Toole & Xxxxxxxx
000 Xxxxx 00/xx/ Xxxxxx, Xxxxx 000 XX0
Xxxxxxxx, Xxxxxxx 00000-0000
-----------------------------------------------------------------------------------------------
Nebraska Xxxxxx & Xxxxx
000 Xxxxx 00/xx/ Xxxxxx Xxxxx 000, Xxxxxxx
Center, X.X. Xxx 00000
Xxxxxxx, Xxxxxxxx 00000-0000
-----------------------------------------------------------------------------------------------
Xxx Xxxxxxxxx Xxxxxxxxx, Xxxxxxxx & Xxxxxxxx, XX
000 Xxxxx Xxxx Xxxxxx, P.O. Box 1415
Concord, New Hampshire 03302-1415
-----------------------------------------------------------------------------------------------
Nevada Xxxxxx Xxxxxx & Xxxxxxx
1700 Bank of America Plaza
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
-----------------------------------------------------------------------------------------------
New Mexico Xxxxx, Dickason, Sloan, Akin & Xxxx
000 Xxxxx Xx. XX, Xxxxx 0000
Xxxxxxxxxxx, XX 00000
-----------------------------------------------------------------------------------------------
North Carolina Womble Xxxxxxx Xxxxxxxxx & Xxxx
000 Xxxx Xxxxxx Xx., Xxxxx 0000
Xxxxxxx-Xxxxx, XX 00000
-----------------------------------------------------------------------------------------------
Ohio Vorys, Xxxxx, Xxxxxxx and Pease
52 East Gray Street
P.O. Box 1008
Columbus, Ohio 43216-1008
-----------------------------------------------------------------------------------------------
2
-----------------------------------------------------------------------------------------------
Oklahoma McAfee & Taft
211 N. Robinson
Two Leadership Square, 10/th/ Floor
Oklahoma City, OK 73102
-----------------------------------------------------------------------------------------------
Oregon Davis Wright Tremaine LLP
2300 First Interstate Tower
1300 SW Fifth Avenue
Portland, OR 07201
-----------------------------------------------------------------------------------------------
Pennsylvania Buchanan Ingersoll, P.C.
1835 Market Street, 14/th/ Fl.
Philadelphia, PA 19103
-----------------------------------------------------------------------------------------------
Rhode Island Hinckley Allen & Snyder
1500 Fleet Center
Providence, RI 02903
-----------------------------------------------------------------------------------------------
Tennessee Thomason, Hendrix, Harvey, Johnson & Mitchell
Twenty-Ninth Floor One Commerce Square, 40
South Main
Memphis, Tennessee 38103
-----------------------------------------------------------------------------------------------
Texas Baker & Botts, L.L.P.
98 San Jacinto Blvd.
1600 San Jacinto Center
Austin, TX 78701-4039
-----------------------------------------------------------------------------------------------
Utah Fabian & Clendenin
215 South State Street, 12/th/ Floor
Salt Lake City, UT 84111-2309
-----------------------------------------------------------------------------------------------
Vermont Dinse, Knapp & McAndrew, P.C.
209 Battery Street
PO Box 988
Burlington, VT 05042-0988
-----------------------------------------------------------------------------------------------
Virginia Gary W. Lonergan
115 Oronoco Street
Alexandria, Virginia 22314
-----------------------------------------------------------------------------------------------
Washington Davis Wright Tremaine LLP
2600 Century Square
1501 Fourth Avenue
Seattle, WA 98101-1688
-----------------------------------------------------------------------------------------------
Wisconsin Ehlinger Law Office, LLC
Stonewood Corporate Center
W175 N11117 Stonewood Dr. #211
Germantown, Wisconsin 53022
-----------------------------------------------------------------------------------------------
Wyoming Rogers and Associates
122 East Seventeenth Street
Cheyenne, WY 82001
-----------------------------------------------------------------------------------------------
3
SCHEDULE 8
LITIGATION
----------
(Capitalized terms used but not otherwise defined
shall have the meaning ascribed thereto in
Vencor's annual filing on Form 10-K for fiscal year 2000)
On September 13, 1999, the Company and substantially all of its
subsidiaries filed voluntary petitions for protection under Chapter 11 of the
Bankruptcy Code. The Chapter 11 Cases have been styled In re: Vencor, Inc., et
al., Debtors and Debtors in Possession, Case Nos. 99-3199 (MFW) through 99-3327
(MFW), Chapter 11, Jointly Administered. On December 14, 2000, the Company filed
its Amended Plan with the Bankruptcy Court. On March 1, 2001, the Bankruptcy
Court approved the Company's Amended Plan and an order was entered confirming
the Amended Plan on March 16, 2001.
On March 18, 1999, the Company served Ventas with a demand for mediation
pursuant to the Spin-off Agreement. The Company was seeking a reduction in rent
and other concessions under its Master Lease Agreements with Ventas. On March
31, 1999, the Company and Ventas entered into a standstill agreement which
provided that both companies would postpone through April 12, 1999 any claims
either may have against the other. On April 12, 1999, the Company and Ventas
entered into a second standstill which provided that neither party would pursue
any claims against the other or any other third party related to the Spin-off as
long as the Company complied with certain rent payment terms. The second
standstill was scheduled to terminate on May 5, 1999. Pursuant to a tolling
agreement, the Company and Ventas also agreed that any statutes of limitations
or other time-related constraints in a bankruptcy or other proceeding that might
be asserted by one party against the other would be extended and tolled from
April 12, 1999 until May 5, 1999 or until the termination of the second
standstill. As a result of the Company's failure to pay rent, Ventas served the
Company with notices of nonpayment under the Master Lease Agreements.
Subsequently, the Company and Ventas entered into further amendments to the
second standstill and the tolling agreement to extend the time during which no
remedies may be pursued by either party and to extend the date by which the
Company may cure its failure to pay rent.
In connection with the Chapter 11 Cases, the Company and Ventas entered
into the Stipulation that provides for the payment by the Company of a reduced
aggregate monthly rent of approximately $15.1 million. The Stipulation has been
approved by the Bankruptcy Court. The Stipulation also continues to toll any
statutes of limitations or other time constraints in a bankruptcy proceeding for
claims that might be asserted by the Company against Ventas. The Stipulation
automatically renews for one-month periods unless either party provides a 14-day
notice of termination. The Stipulation also may be terminated prior to its
expiration upon a payment default by the Company, the consummation of a plan of
reorganization or the occurrence of certain defaults under the DIP Financing.
The Stipulation also provides that the Company will continue to fulfill its
indemnification obligations arising from the Spin-off. The Stipulation will
terminate upon the effective date of the Amended Plan.
The Company believes that the Amended Plan, if consummated, will resolve
all material disputes between the Company and Ventas. The Amended Plan also
provides for comprehensive mutual releases between the Company and Ventas, other
than for obligations that the Company is assuming under the Amended Plan.
If the Amended Plan does not become effective and the Company and Ventas
are unable to otherwise resolve their disputes or maintain an interim
resolution, the Company may seek to pursue claims against Ventas arising out of
the Spin-off and seek judicial relief barring Ventas from exercising any
remedies based on the Company's failure to pay some or all of the rent to
Ventas. The Company's failure to pay rent or otherwise comply with the
Stipulation, in the absence of judicial relief, would result in an "Event of
Default" under the Master Lease Agreements. Upon an Event of Default under the
Master Lease Agreements, assuming Ventas were to be granted relief from the
automatic stay by the Bankruptcy Court, the remedies available to Ventas
include, without limitation, terminating the Master Lease Agreements,
repossessing and reletting the leased properties and requiring the Company to
(a) remain liable for all obligations under the Master Lease Agreements,
including the difference between the rent under the Master Lease Agreements and
the rent payable as a result of reletting the leased properties or (b) pay the
net present value of the rent due for the balance of the terms of the Master
Lease Agreements. Such remedies, however, would be subject to the supervision of
the Bankruptcy Court.
The Company's subsidiary, formerly named TheraTx, Incorporated, is
plaintiff in a declaratory judgment action entitled TheraTx, Incorporated v.
James W. Duncan, Jr., et al., No. 1:95-CV-3193, filed in the United States
District Court for the Northern District of Georgia and currently pending in the
United States Court of Appeals for the Eleventh Circuit, No. 99-11451-FF. The
defendants have asserted counterclaims against TheraTx under breach of contract,
securities fraud, negligent misrepresentation and other fraud theories for
allegedly not performing as promised under a merger agreement related to
TheraTx's purchase of a company called PersonaCare, Inc. and for allegedly
failing to inform the defendants/counterclaimants prior to the merger that
TheraTx's possible acquisition of Southern Management Services, Inc. might cause
the suspension of TheraTx's shelf registration under relevant rules of the
Securities and Exchange Commission (the "Commission"). The court granted summary
judgment for the defendants/counterclaimants and ruled that TheraTx breached the
shelf registration provision in the merger agreement, but dismissed the
defendants' remaining counterclaims. Additionally, the court ruled after trial
that defendants/counterclaimants were entitled to damages and prejudgment
interest in the amount of approximately $1.3 million and attorneys' fees and
other litigation expenses of approximately $700,000. The Company and the
defendants/counterclaimants both appealed the court's rulings. The Court of
Appeals for the Eleventh Circuit affirmed the trial court's rulings with the
exception of the damages award and certified the question of the proper
calculation of damages under Delaware law to the Delaware Supreme Court. The
Company is defending the action vigorously.
The Company is pursuing various claims against private insurance companies
who issued Medicare supplement insurance policies to individuals who became
patients of the Company's hospitals. After the patients' Medicare benefits are
exhausted, the insurance companies become liable to pay the insureds' bills
pursuant to the terms of these policies. The Company has filed
2
numerous collection actions against various of these insurers to collect the
difference between what Medicare would have paid and the hospitals' usual and
customary charges. These disputes arise from differences in interpretation of
the policy provisions and federal and state laws governing such policies.
Various courts have issued various rulings on the different issues, some of
which have been adverse to the Company and most of which have been appealed. The
Company intends to continue to pursue these claims vigorously. If the Company
does not prevail on these issues, future results of operations and liquidity
would be materially adversely affected.
A class action lawsuit entitled A. Carl Helwig v. Vencor, Inc., et al., was
filed on December 24, 1997 in the United States District Court for the Western
District of Kentucky (Civil Action No. 3-97CV-8354). The class action claims
were brought by an alleged stockholder of the Company's predecessor against the
Company and Ventas and certain current and former executive officers and
directors of the Company and Ventas. The complaint alleges that the Company,
Ventas and certain current and former executive officers of the Company and
Ventas during a specified time frame violated Sections 10(b) and 20(a) of the
Exchange Act, by, among other things, issuing to the investing public a series
of false and misleading statements concerning Ventas' then current operations
and the inherent value of its common stock. The complaint further alleges that
as a result of these purported false and misleading statements concerning
Ventas' revenues and successful acquisitions, the price of the common stock was
artificially inflated. In particular, the complaint alleges that the defendants
issued false and misleading financial statements during the first, second and
third calendar quarters of 1997 which misrepresented and understated the impact
that changes in Medicare reimbursement policies would have on Ventas' core
services and profitability. The complaint further alleges that the defendants
issued a series of materially false statements concerning the purportedly
successful integration of Ventas' acquisitions and prospective earnings per
share for 1997 and 1998 which the defendants knew lacked any reasonable basis
and were not being achieved. The suit seeks damages in an amount to be proven at
trial, pre-judgment and post-judgment interest, reasonable attorneys' fees,
expert witness fees and other costs, and any extraordinary equitable and/or
injunctive relief permitted by law or equity to assure that the plaintiff has an
effective remedy. In December 1998, the defendants filed a motion to dismiss the
case. The court converted the defendants' motion to dismiss into a motion for
summary judgment and granted summary judgment as to all defendants. The
plaintiff appealed the ruling to the United States Court of Appeals for the
Sixth Circuit. On April 24, 2000, the Sixth Circuit affirmed the district
court's dismissal of the action on the grounds that the plaintiff failed to
state a claim upon which relief could be granted. On July 14, 2000, the Sixth
Circuit granted the plaintiff's petition for a rehearing en banc. The Company is
defending this action vigorously.
A shareholder derivative suit entitled Thomas G. White on behalf of Vencor,
Inc. and Ventas, Inc. v. W. Bruce Lunsford, et al., Case No. 98CI03669, was
filed in June 1998 in the Jefferson County, Kentucky, Circuit Court. The suit
was brought on behalf of the Company and Ventas against certain current and
former executive officers and directors of the Company and Ventas. The complaint
alleges that the defendants damaged the Company and Ventas by engaging in
violations of the securities laws, engaging in insider trading, fraud and
securities fraud and damaging the reputation of the Company and Ventas. The
plaintiff asserts that such actions were taken deliberately, in bad faith and
constitute breaches of the defendants' duties of loyalty and due care. The
complaint is based on substantially similar assertions to those made in
3
the class action lawsuit entitled A. Carl Helwig v. Vencor, Inc., et al.,
discussed above. The suit seeks unspecified damages, interest, punitive damages,
reasonable attorneys' fees, expert witness fees and other costs, and any
extraordinary equitable and/or injunctive relief permitted by law or equity to
assure that the Company and Ventas have an effective remedy. The Company
believes that the allegations in the complaint are without merit and intends to
defend this action vigorously.
A class action lawsuit entitled Jules Brody v. Transitional Hospitals
Corporation, et al., Case No. CV-S-97-00747-PMP, was filed on June 19, 1997 in
the United States District Court for the District of Nevada on behalf of a class
consisting of all persons who sold shares of Transitional common stock during
the period from February 26, 1997 through May 4, 1997, inclusive. The complaint
alleges that Transitional purchased shares of its common stock from members of
the investing public after it had received a written offer to acquire all of the
Transitional common stock and without making the required disclosure that such
an offer had been made. The complaint further alleges that defendants disclosed
that there were "expressions of interest" in acquiring Transitional when, in
fact, at that time, the negotiations had reached an advanced stage with actual
firm offers at substantial premiums to the trading price of Transitional's stock
having been made which were actively being considered by Transitional's Board of
Directors. The complaint asserts claims pursuant to Sections 10(b), 14(e) and
20(a) of the Exchange Act, and common law principles of negligent
misrepresentation and names as defendants Transitional as well as certain former
senior executives and directors of Transitional. The plaintiff seeks class
certification, unspecified damages, attorneys' fees and costs. In June 1998, the
court granted the Company's motion to dismiss with leave to amend the Section
10(b) claim and the state law claims for misrepresentation. The court denied the
Company's motion to dismiss the Section 14(e) and Section 20(a) claims, after
which the Company filed a motion for reconsideration. On March 23, 1999, the
court granted the Company's motion to dismiss all remaining claims and the case
was dismissed. The plaintiff has appealed this ruling to the United States Court
of Appeals for the Ninth Circuit. The Company is defending this action
vigorously.
On April 14, 1999, a lawsuit entitled Lenox Healthcare, Inc., et al. v.
Vencor, Inc., et al., Case No. BC 208750, was filed in the Superior Court of Los
Angeles, California by Lenox Healthcare, Inc. ("Lenox") asserting various causes
of action arising out of the Company's sale and lease of several nursing centers
to Lenox in 1997. Lenox subsequently removed certain of its causes of action and
refiled these claims before the United States District Court for the Western
District of Kentucky in a case entitled Lenox Healthcare, Inc. v. Vencor, Inc.,
et al., Case No. 3:99 CV-348-H. The Company asserted counterclaims, including
RICO claims, against Lenox in the Kentucky action. The Company believes that the
allegations made by Lenox in both complaints are without merit. Lenox and its
subsidiaries filed for protection under Chapter 11 of the Bankruptcy Code on
November 3, 1999. By virtue of both the Company's and Lenox's separate filings
for Chapter 11 protection, the two Lenox actions and the Company's counterclaims
were stayed. Subsequently, the parties entered into a settlement, which was
approved by their respective bankruptcy courts, that requires the dismissal of
the two above actions. Joint motions to dismiss have been filed by the parties
in each court.
The Company was informed by the DOJ that the Company and Ventas are the
subjects of investigations into various Medicare reimbursement issues, including
hospital cost reporting
4
issues, Vencare billing practices and various quality of care issues in the
hospitals and nursing centers formerly operated by Ventas and currently operated
by the Company. These investigations include some matters for which the Company
indemnified Ventas in the Spin-off. In cases where neither the Company nor any
of its subsidiaries are defendants but Ventas is the defendant, the Company had
agreed to defend and indemnify Ventas for such claims as part of the Spin-off.
The Stipulation entered into with Ventas provides that the Company will continue
to fulfill its indemnification obligations arising from the Spin-off. The
Company has cooperated fully in the investigations.
The DOJ has informed the Company that it has intervened in several pending
qui tam actions asserted against the Company and/or Ventas in connection with
these investigations. In addition, the DOJ has filed proofs of claims with
respect to certain alleged claims in the Chapter 11 Cases. The Company, Ventas
and the DOJ have finalized the terms of the Government Settlement which will
resolve all of the DOJ investigations including the pending qui tam actions.
The Government Settlement provides that within 30 days after the Amended Plan
becomes effective, the Government will move to dismiss with prejudice to the
United States and the relators (except for certain claims which will be
dismissed without prejudice to the United States in certain of the cases) the
pending qui tam actions as against any or all of the Company and its
subsidiaries, Ventas and any current or former officers, directors and employees
of either entity. There can be no assurance that each court before which a qui
tam action is pending will dismiss the case on the DOJ's motion.
The following is a summary of the qui tam actions pending against the
Company and/or Ventas in which the DOJ has intervened. In connection with the
DOJ's intervention, the courts ordered these previously non-public actions to be
unsealed. Certain of the actions described below name other defendants in
addition to the Company and Ventas.
(a) The Company, Ventas and the Company's subsidiary, American X-Rays, Inc.
("AXR"), are defendants in a civil qui tam action styled United States ex rel.
Doe v. American X-Rays Inc., et al., No. LR-C-95-332, pending in the United
States District Court for the Eastern District of Arkansas and served on AXR on
July 7, 1997. The DOJ intervened in the suit which was brought under the Federal
Civil False Claims Act and added the Company and Ventas as defendants. The
Company acquired an interest in AXR when Hillhaven was merged into the Company
in September 1995 and purchased the remaining interest in AXR in February 1996.
AXR provided portable X-ray services to nursing centers (including some of those
operated by Ventas or the Company) and other healthcare providers. The civil
suit alleges that AXR submitted false claims to the Medicare and Medicaid
programs. The suit seeks damages in an amount of not less than $1,000,000,
treble damages and civil penalties. The Company has defended this action
vigorously. The court has dismissed the action based upon the possible pending
settlement between the DOJ, the Company and Ventas. In a related criminal
investigation, the United States Attorney's Office for the Eastern District of
Arkansas ("USAO") indicted four former employees of AXR; those individuals were
convicted of various fraud related counts in January 1999. AXR had been informed
previously that it was not a target of the criminal investigation, and AXR was
not indicted. However, the Company received several grand jury subpoenas for
documents and witnesses which it moved to quash. The USAO has withdrawn the
subpoenas which rendered the motion moot.
5
(b) The Company's subsidiary, Medisave Pharmacies, Inc. ("Medisave"),
Ventas and Hillhaven (former parent company to Medisave), are the defendants in
a civil qui tam action styled United States ex rel. Danley v. Medisave
Pharmacies, Inc., et al., No. CV-N-96-00170-HDM, filed in the United States
District Court for the District of Nevada on March 15, 1996. The plaintiff
alleges that Medisave, an institutional pharmacy provider, formerly owned by
Ventas and owned by the Company since the Spin-off: (a) charged the Medicare
program for unit dose drugs when bulk drugs were administered and charged
skilled nursing facilities more for the same drugs for Medicare patients than
for non-Medicare patients; (b) improperly claimed special dispensing fees that
it was not entitled to under Medicaid; and (c) recouped unused drugs from
skilled nursing facilities and returned these drugs to its stock without
crediting Medicare or Medicaid, all in violation of the Federal Civil False
Claims Act. The complaint also alleges that Medisave had a policy of offering
kickbacks, such as free equipment, to skilled nursing centers to secure and
maintain their business. The complaint seeks treble damages, other unspecified
damages, civil penalties, attorneys' fees and other costs. The Company disputes
the allegations in the complaint. The defendants intend to defend this action
vigorously.
(c) Ventas and the Company's subsidiary, Vencare, Inc. ("Vencare"), among
others, are defendants in the action styled United States ex rel. Roberts v.
Vencor, Inc., et al., No. 3:97CV-349-J, filed in the United States District
Court for the Western District of Kansas on June 25, 1996 and consolidated with
the action styled United States of America ex rel. Meharg, et al. v. Vencor,
Inc., et al., No. 3:98SC-737-H, filed in the United States District Court for
the Middle District of Florida on June 4, 1998. The complaint alleges that the
defendants knowingly submitted and conspired to submit false claims and
statements to the Medicare program in connection with their purported provision
of respiratory therapy services to skilled nursing center residents. The
defendants allegedly billed Medicare for respiratory therapy services and
supplies when those services were not medically necessary, billed for services
not provided, exaggerated the time required to provide services or exaggerated
the productivity of their therapists. It is further alleged that the defendants
presented false claims and statements to the Medicare program in violation of
the Federal Civil False Claims Act, by, among other things, allegedly causing
skilled nursing centers with which they had respiratory therapy contracts, to
present false claims to Medicare for respiratory therapy services and supplies.
The complaint seeks treble damages, other unspecified damages, civil penalties,
attorneys' fees and other costs. The Company disputes the allegations in the
complaint. The defendants intend to defend this action vigorously.
(d) In United States ex rel. Kneepkens v. Gambro Healthcare, Inc., et al.,
No. 97-10400-GAO, filed in the United States District Court for the District of
Massachusetts on October 15, 1998, the Company's subsidiary, Transitional, and
two unrelated entities, Gambro Healthcare, Inc. and Dialysis Holdings, Inc., are
defendants in this suit alleging that they violated the Federal Civil False
Claims Act and the Medicare and Medicaid antikickback, antifraud and abuse
regulations and committed common law fraud, unjust enrichment and payment by
mistake of fact. Specifically, the complaint alleges that a predecessor to
Transitional formed a joint venture with Damon Clinical Laboratories to create
and operate a clinical testing laboratory in Georgia that was then used to
provide lab testing for dialysis patients, and that the joint venture billed at
below cost in return for referral of substantially all non-routine testing in
violation of Medicare
6
and Medicaid antikickback and antifraud regulations. It is further alleged that
a predecessor to Transitional and Damon Clinical Laboratories used multiple
panel testing of end stage renal disease rather than single panel testing that
allegedly resulted in the generation of additional revenues from Medicare and
that the entities allegedly added non-routine tests to tests otherwise ordered
by physicians that were not requested or medically necessary but resulted in
additional revenue from Medicare in violation of the antikickback and antifraud
regulations. Transitional has moved to dismiss the case. Transitional disputes
the allegations in the complaint and is defending the action vigorously.
(e) The Company and/or Ventas are defendants in the action styled United
States ex rel. Huff and Dolan v. Vencor, Inc., et al., No. 97-4358 AHM (Mcx),
filed in the United States District Court for the Central District of California
on June 13, 1997. The plaintiff alleges that the defendant violated the Federal
Civil False Claims Act by submitting false claims to the Medicare, Medicaid and
CHAMPUS programs by allegedly: (a) falsifying patient bills and submitting the
bills to the Medicare, Medicaid and CHAMPUS programs, (b) submitting bills for
intensive and critical care not actually administered to patients, (c)
falsifying patient charts in relation to the billing, (d) charging for physical
therapy services allegedly not provided and pharmacy services allegedly provided
by non-pharmacists, and (e) billing for sales calls made by nurses to
prospective patients. The complaint seeks treble damages, other unspecified
damages, civil penalties, attorneys' fees and other costs. Defendants dispute
the allegations in the complaint. The Company, on behalf of itself and Ventas,
intends to defend this action vigorously.
(f) Ventas is the defendant in the action styled United States ex rel.
Brzycki v. Vencor, Inc., Civ. No. 97-451-JD, filed in the United States District
Court for the District of New Hampshire on September 8, 1997. Ventas is alleged
to have knowingly violated the Federal Civil False Claims Act by submitting and
conspiring to submit false claims to the Medicare program. The complaint alleges
that Ventas: (a) fabricated diagnosis codes by ordering medically unnecessary
services, such as respiratory therapy; (b) changed referring physicians'
diagnoses in order to qualify for Medicare reimbursement; and (c) billed
Medicare for oxygen use by patients regardless of whether the oxygen was
actually administered to particular patients. The complaint further alleges that
Ventas paid illegal kickbacks to referring healthcare professionals in the form
of medical consulting service agreements as an alleged inducement to refer
patients, in violation of the Federal Civil False Claims Act, the antikickback
and antifraud regulations and the Stark provisions. It is additionally alleged
that Ventas consistently submitted Medicare claims for clinical services that
were not performed or were performed at lower actual costs. The complaint seeks
unspecified damages, civil penalties, attorneys' fees and costs. Ventas disputes
the allegations in the complaint. The Company, on behalf of Ventas, intends to
defend the action vigorously.
(g) United States ex rel. Lanford and Cavanaugh v. Vencor, Inc., et al.,
Civ. No. 97-CV-2845, was filed against Ventas in the United States District
Court for the Middle District of Florida, on November 24, 1997. The United
States of America intervened in this civil qui tam lawsuit on May 17, 1999. On
July 23, 1999, the United States filed its amended complaint in the lawsuit and
added the Company as a defendant. The lawsuit alleges that the Company and
Ventas knowingly submitted false claims and false statements to the Medicare and
Medicaid
7
programs including, but not limited to, claims for reimbursement of costs for
certain ancillary services performed in defendants' nursing centers and for
third-party nursing center operators that the United States alleges are not
properly reimbursable costs through the hospitals' cost reports. The lawsuit
involves the Company's hospitals which were owned by Ventas prior to the Spin-
off. The complaint does not specify the amount of damages sought. The Company
and Ventas dispute the allegations in the amended complaint and intend to defend
this action vigorously.
(h) In United States ex rel. Harris and Young v. Vencor, Inc., et al.,
filed in the Eastern District of Missouri on May 25, 1999, the defendants
include the Company, Vencare, and Ventas. The defendants allegedly submitted and
conspired to submit false claims for payment to the Medicare and CHAMPUS
programs, in violation of the Federal Civil False Claims Act. According to the
complaint, the Company, through its subsidiary, Vencare, allegedly (a) over
billed for respiratory therapy services, (b) rendered medically unnecessary
treatment, and (c) falsified supply, clinical and equipment records. The
defendants also allegedly encouraged or instructed therapists to falsify
clinical records and over prescribe therapy services. The complaint seeks
treble damages, other unspecified damages, civil penalties, attorneys' fees and
other costs. The Company disputes the allegations in the complaint and intends
to defend this action vigorously. The action has been dismissed with prejudice
as to the relator and without prejudice as to the United States.
(i) In United States ex rel. George Mitchell, et al. v. Vencor, Inc., et
al., filed in the United States District Court for the Southern District of Ohio
on August 13, 1999, the defendants, consisting of the Company and its two
subsidiaries, Vencare and Vencor Hospice, Inc., are alleged to have violated the
Federal Civil False Claims Act by obtaining improper reimbursement from Medicare
concerning the treatment of hospice patients. Defendants are alleged to have
obtained inflated Medicare reimbursement for admitting, treating and/or failing
to discharge in a timely manner hospice patients who were not "hospice
appropriate." The complaint further alleges that the defendants obtained
inflated reimbursement for providing medications for these hospice patients. The
complaint alleges damages in excess of $1,000,000. The Company disputes the
allegations in the complaint and intends to defend vigorously the action.
(j) In Gary Graham, on Behalf of the United States of America v. Vencor
Operating, Inc. et. al., filed in the United States District Court for the
Southern District of Florida on or about June 8, 1999, the defendants, including
the Company, its subsidiary, Vencor Operating, Inc., Ventas, Hillhaven and
Medisave, are alleged to have presented or caused to be presented false or
fraudulent claims for payment to the Medicare program in violation of, among
other things, the Federal Civil False Claims Act. The complaint alleges that
Medisave, a subsidiary of the Company which was transferred from Ventas to the
Company in the Spin-off, systematically up-charged for drugs and supplies
dispensed to Medicare patients. The complaint seeks unspecified damages, civil
penalties, interest, attorneys' fees and other costs. The Company disputes the
allegations in the complaint and intends to defend this action vigorously.
(k) In United States, et al., ex rel. Phillips-Minks, et al. v.
Transitional Corp., et al., filed in the United States District Court for
Southern District of California on July 23, 1998, the
8
defendants, including Transitional and Ventas, are alleged to have submitted and
conspired to submit false claims and statements to Medicare, Medicaid, and other
federal and state funded programs during a period commencing in 1993. The
conduct complained of allegedly violates the Federal Civil False Claims Act, the
California False Claims Act, the Florida False Claims Act, the Tennessee Health
Care False Claims Act, and the Illinois Whistleblower Reward and Protection Act.
The defendants allegedly submitted improper and erroneous claims to Medicare,
Medicaid and other programs, for improper or unnecessary services and services
not performed, inadequate collections efforts associated with billing and
collecting bad debts, inflated and nonexistent laboratory charges, false and
inadequate documentation of claims, splitting charges, shifting revenues and
expenses, transferring patients to hospitals that are reimbursed by Medicare at
a higher level, failing to return duplicate reimbursement payments, and
improperly allocating hospital insurance expenses. In addition, the complaint
alleges that the defendants were inconsistent in their reporting of cost report
data, paid kickbacks to increase patient referrals to hospitals, and incorrectly
reported employee compensation resulting in inflated employee 401(k)
contributions. The complaint seeks unspecified damages. The Company disputes the
allegations in the complaint and intends to defend this action vigorously.
In connection with the Spin-off, liabilities arising from various legal
proceedings and other actions were assumed by the Company and the Company agreed
to indemnify Ventas against any losses, including any costs or expenses, it may
incur arising out of or in connection with such legal proceedings and other
actions. The indemnification provided by the Company also covers losses,
including costs and expenses, which may arise from any future claims asserted
against Ventas based on the former healthcare operations of Ventas. In
connection with its indemnification obligation, the Company has assumed the
defense of various legal proceedings and other actions. The Stipulation entered
into with Ventas provides that the Company will continue to fulfill its
indemnification obligations arising from the Spin-off.
The Company is a party to certain legal actions and regulatory
investigations arising in the normal course of its business. The Company is
unable to predict the ultimate outcome of pending litigation and regulatory
investigations. In addition, there can be no assurance that the DOJ, HCFA or
other regulatory agencies will not initiate additional investigations related to
the Company's businesses in the future, nor can there be any assurance that the
resolution of any litigation or investigations, either individually or in the
aggregate, would not have a material adverse effect on the Company's results of
operations, liquidity or financial position. In addition, the above litigation
and investigations (as well as future litigation and investigations) are
expected to consume the time and attention of the Company's management and may
have a disruptive effect upon the Company's operations.
* * * * * * * * * * * * * * * * * * * * * * *
In the opinion of Vencor Operating, Inc., there is no reasonable
possibility of an adverse decision with respect to the actions disclosed on this
Schedule 8 that could reasonably be expected to have a Material Adverse Effect
or which in any manner would question the validity of any Financing Document.
9
SCHEDULE 9
EXISTING INDEBTEDNESS
---------------------
--------------------------------------------------------------------------------
CREDITOR PRINCIPAL DESCRIPTION
BALANCE/1/
--------------------------------------------------------------------------------
Middleton Village $ 1,675,938 mortgage on real/personal
property - Nursing Center
--------------------------------------------------------------------------------
Various Landlords under $ 949,799 See attached chart
Capitalized Leases
--------------------------------------------------------------------------------
City of Louisville $ 4,200,000 Lien on property under a city
development grant for corporate
headquarters.
--------------------------------------------------------------------------------
Recovery Inn of Menlo $4,228,008.88 Intercompany balance
Park, L.P. (open accounts)
--------------------------------------------------------------------------------
______________________________
/1/ All balances as of March 31, 2001.
EXISTING INDEBTEDNESS (continued)
---------------------------------
CAPITALIZED LEASES
------------------
------------------------------------------------------------------------------------------------------------
LIEN HOLDER LIEN GRANTOR PRINCIPAL DESCRIPTION
AMOUNT OF
DEBT SECURED
BY LIEN/2/
------------------------------------------------------------------------------------------------------------
IBM Credit Corp. Vencor, Inc. $208,356 IBM Rise 6000
000 Xxxxxx Xxxxx Computer Servers
X.X. Xxx 00000
Xxxxxxxx, XX 00000-0000
------------------------------------------------------------------------------------------------------------
Wesleyan Retirement Center Vencor Nursing Centers $ 18,732 Personal Property
d/b/a/ Colonial Oaks Ret. Apts. Limited Partnership
000 X. Xxxxxxxx Xxxx Xxxxx Xxxxxxxx Xxxx Health
Marion, IN 46953 Care Center
0000 Xxxxx Xxxxxxxx
Xxxx Xxxxx
Xxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $115,732 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
Castleton
0000 Xxxx 00/xx/ Xxxxxx
Xxxxxxxxxxxx, XX
00000
------------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $107,346 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
Xxxx
0000 Xxxxx Xxxxx
Xxxxx
Xxxx, XX 00000
------------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $169,106 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
Greenwood
000 Xxxxxxxxx
Xxxxxxxxx
Xxxxxxxxx, XX
------------------------------------------------------------------------------------------------------------
______________________________
/2/ All balances as of March 31, 2001.
2
----------------------------------------------------------------------------------------------------------
46142
----------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $115,731 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
Fort Xxxxx
0000 Xxxxxx Xxxxx
Xxxx
Xx. Xxxxx, XX 00000
----------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $169,074 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
Greenfield
000 Xxxxx Xxxxxxx
Xxxxx
Xxxxxxxxxx, XX 00000
-----------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $115,731 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
Lafayette
000 Xxxxx Xxxx Xxxxx
Xxxxxxxxx, XX 00000
----------------------------------------------------------------------------------------------------------
Health Quest Vencor Nursing Centers $107,346 Personal Property
000 Xxxx Xxxxxxxxx Xxxxxxxxx Limited Partnership
South Bend, IN 46601-1586 Regency Place of
South Bend
00000 Xxxxx
Xxxxxxxx Xxxx
Xxxxx Xxxx, XX
00000
----------------------------------------------------------------------------------------------------------
3
Schedule 10
Debt Not Held in Concentration Accounts or Pledged
--------------------------------------------------
1. All of the following obligations owed to Vencor Operating, Inc. (all
balances as of April 19, 2001)
Consolidating
Entity Entity Name Total Principal
------ ----------- ---------------
No Hillhaven - MSC Partnership 392,500.00
No Xxxxxx Xxxxx Associates 3,589,000.00
Yes Foothill Nursing Company Partnership 12,351,982.39
Yes Pharmaceutical Infusion Therapy Partnership 650,000.00
Yes California Respiratory Care Partnership 527,000.00
Yes Visiting Nurse Advanced Infusion Systems - Anaheim 350,000.00
Yes Carribean Behavioral Health Systems, Inc. 292,858.96
Grand Total 18,153,341.35
=============
2. All obligations (in the aggregate not exceeding $16 million) owed to Vencor
Operating, Inc. and/or Vencor, Inc. from certain current and former officers
of Vencor as referenced on Schedule 6.
SCHEDULE 11
POST-CLOSING DELIVERIES
-----------------------
1. Restricted Subsidiaries for which replacement stock certificates are to be
delivered after the Closing Date in accordance with the terms of the Credit
Agreement:
Health Care Holdings, Inc. (to account for name change of its parent
from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab Services,
Inc.)
Helian Health Group, Inc. (to account for name change of its parent
from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab Services,
Inc.)
Horizon Healthcare Services, Inc. (to account for name change of its
parent from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab
Services, Inc.)
PersonaCare, Inc. (to account for name change of its parent from
TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab Services, Inc.)
PersonaCare of Bradenton, Inc. (to reflect a par value of $.001 per
share)
PersonaCare of Warner Robins, Inc. (to reflect a par value of $.001
per share)
Respiratory Care Services, Inc. (to account for name change of its
parent from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab
Services, Inc.)
TheraTx Health Services, Inc. (to account for name change of its
parent from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab
Services, Inc.)
TheraTx Healthcare Management, Inc. (to account for name change of its
parent from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab
Services, Inc.)
TheraTx Management Services, Inc. (to account for name change of its
parent from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab
Services, Inc.)
TheraTx Medical Supplies, Inc. (to account for name change of its
parent from TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab
Services, Inc.)
TheraTx Rehabilitation Services, Inc. (to reflect correct name of its
parent, TheraTx Health Services, Inc.)
TheraTx Staffing, Inc. (to account for name change of its parent from
TheraTx, Inc. to Vencare Rehab Services, Inc. to Kindred Rehab Services, Inc.)
XX-XX, Inc. (to account for name change of its parent from TheraTx,
Inc. to Vencare Rehab Services, Inc. to Kindred Rehab Services, Inc.)
2. Investment for which stock certificate is to be delivered after the Closing
Date in accordance with the terms of the Credit Agreement:
Lectus Inc. (representing 1,933,901 shares held by Vencor Operating,
Inc. but currently certificated in the name of Ventas Investments)
2
EXHIBIT A
NOTE
$_______________ New York, New York
April __, 2001
THIS NOTE AND THE INDEBTEDNESS EVIDENCED HEREBY ARE SUBORDINATE IN THE MANNER
AND TO THE EXTENT SET FORTH IN THAT CERTAIN CREDIT AGREEMENT REFERRED TO BELOW
IN ACCORDANCE WITH THE TERMS THEREOF, AND THE RIGHTS AND REMEDIES OF THE HOLDER
OF THIS NOTE ARE SUBJECT TO THE TERMS AND CONDITIONS OF THAT CERTAIN
SUBORDINATION AND INTERCREDITOR AGREEMENT DATED AS OF APRIL 20, 2001 BY AND
AMONG THE ISSUER, VENCOR, THE COLLATERAL AGENT AND THE EXIT FACILITY COLLATERAL
AGENT, AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO
TIME (THE "INTERCREDITOR AGREEMENT").
For value received, VENCOR OPERATING, INC. (to be renamed Kindred
Healthcare Operating, Inc.), a Delaware corporation (the "Issuer"), promises to
pay [name of Lender] or its registered assigns (the "Lender"), for the account
of its Lending Office, the principal amount of $_______, or such lesser amount
as is the outstanding principal amount of the Loan evidenced by this Note issued
by the Issuer pursuant to the Credit Agreement referred to below, on the
maturity date provided for in the Credit Agreement. The Issuer promises to pay
interest on the unpaid principal amount hereof on the dates and at the rate or
rates provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or other
immediately available funds at the office of the Administrative Agent as set
forth in the Credit Agreement.
All repayments of the principal hereof shall be recorded by the Lender and,
if the Lender so elects in connection with any transfer or enforcement hereof,
appropriate notations to evidence the foregoing information with respect to the
principal amount of the Loan evidenced by this Note then outstanding may be
endorsed by the Lender on the schedule attached hereto, or on a continuation of
such schedule attached to and made a part hereof; provided that neither the
failure of the Lender to make any such recordation or endorsement nor any error
therein shall affect the obligations of the Issuer hereunder or under any other
Financing Document.
A-1
This note is one of the Notes referred to in the $300,000,000 Credit
Agreement dated as of April 20, 2001 among the Issuer, Vencor, Inc. (to be
renamed Kindred Healthcare, Inc.), the Lenders party thereto and Xxxxxx Guaranty
Trust Company of New York, as Administrative Agent and Collateral Agent (as
amended from time to time, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein with the same meanings. Reference is made to the
Credit Agreement for provisions for the prepayment hereof and the acceleration
of the maturity hereof.
By its acceptance hereof, the Lender hereby acknowledges and agrees that
its rights to payment hereunder and under the Financing Documents and its rights
to exercise remedies are subject to the subordination provisions set forth in
Article XI of the Credit Agreement and to the terms and conditions set forth in
the Intercreditor Agreement.
VENCOR OPERATING, INC.
(to be renamed Kindred Healthcare
Operating, Inc.)
By:________________________________
Title:
A-2
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A-3
EXHIBIT B
[EXECUTION COPY]
SECOND PRIORITY SECURITY AGREEMENT
dated as of
April 20, 2001
among
VENCOR OPERATING, INC.
(to be renamed Kindred Healthcare Operating, Inc.)
THE GUARANTORS PARTY HERETO
and
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Collateral Agent
TABLE OF CONTENTS
--------------
Page
----
Section 1. Definitions................................................................ 2
Section 2. Representations and Warranties............................................. 12
Section 3. The Security Interests..................................................... 14
Section 4. Delivery of Certain Collateral............................................. 16
Section 5. Further Assurances; Covenants.............................................. 17
Section 6. Concentration Accounts..................................................... 21
Section 7. Collateral Accounts........................................................ 23
Section 8. Record Ownership of Pledged Equity Securities.............................. 25
Section 9. Right to Vote Pledged Equity Securities.................................... 25
Section 10. Right to Receive Distributions on Collateral............................... 26
Section 11. General Authority.......................................................... 26
Section 12. Remedies upon Enforcement Notice........................................... 27
Section 13. Fees and Expenses; Indemnification......................................... 31
Section 14. Limitation on Duty of Collateral Agent in Respect of Collateral............ 32
Section 15. Application of Proceeds.................................................... 32
Section 16. Concerning the Collateral Agent............................................ 33
Section 17. Appointment of Co-collateral Agents........................................ 37
Section 18. Termination of Security Interests; Release of Collateral; Reinstatement.... 37
Section 19. Additional Subsidiary Guarantors........................................... 38
Section 20. Notices.................................................................... 38
Section 21. Withdrawal of Enforcement Notice........................................... 40
Section 22. Waivers, Remedies Not Exclusive............................................ 41
Section 23. Successors and Assigns..................................................... 41
Section 24. Changes in Writing......................................................... 41
Section 25. NEW YORK LAW............................................................... 41
Section 26. Severability............................................................... 42
Section 27. Intercreditor Agreement.................................................... 42
Section 28. Counterparts............................................................... 42
Exhibit A -- Form of Second Priority Security Agreement Supplement
Exhibit B -- Form of Second Priority Copyright Security Agreement
Exhibit C -- Form of Second Priority Patent Security Agreement
Exhibit D -- Form of Second Priority Trademark Security Agreement
2
Exhibit E -- Form of Second Priority Perfection Certificate
Exhibit F -- Form of Second Priority Leasehold Mortgage
Exhibit G -- Form of Second Priority Fee Mortgage
Exhibit H -- Form of Account Control Agreement
3
SECOND PRIORITY SECURITY AGREEMENT
AGREEMENT dated as of April 20, 2001 among VENCOR OPERATING, INC. (to
be renamed Kindred Healthcare Operating, Inc.), the GUARANTORS party hereto and
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK, as Collateral Agent.
WHEREAS, the Issuer is entering into the Credit Agreement (such term
and other capitalized terms used in these recitals without definition having the
meanings set forth in Section 1 below), pursuant to which the Issuer intends to
issue senior secured notes with a stated principal amount of $300,000,000 to the
Lenders in partial satisfaction of the claims of the Lenders arising under the
$1,000,000,000 Credit Agreement dated as of April 29, 1998 (as amended, the
"Pre-Petition Senior Credit Agreement") among the Issuer, Vencor and a group of
banks and other financial institutions, in connection with which Bank of America
N.A. (previously named Nationsbank N.A.) acted as administrative agent and
Xxxxxx Guaranty Trust Company of New York acted as documentation agent and
collateral agent;
WHEREAS, the Issuer is willing to secure its obligations under the
Credit Agreement and the other Financing Documents by granting Liens on its
assets to the Collateral Agent as provided in this Agreement and the other
Collateral Documents;
WHEREAS, Vencor is guaranteeing the foregoing obligations of the Issuer
as provided in the Vencor Guaranty Agreement and is willing to secure its
guarantee thereof by granting Liens on its assets to the Collateral Agent as
provided in this Agreement and the other Collateral Documents;
WHEREAS, the Issuer is willing to cause each of its Restricted
Subsidiaries to guarantee the foregoing obligations of the Issuer as provided in
a Subsidiary Guaranty Agreement, with each Restricted Subsidiary to secure its
guarantee thereof by granting Liens on its assets to the Collateral Agent as
provided in this Agreement and the other Collateral Documents;
WHEREAS, the Lenders are willing to accept the notes described above in
partial settlement of their claims under the Pre-Petition Senior Credit
Agreement only if (i) the foregoing obligations of the Issuer are secured by
Liens on its assets as provided in the Collateral Documents, (ii) the foregoing
obligations of the Issuer are guaranteed by Vencor and each of the Issuer's
Restricted Subsidiaries and (iii) each such guarantee is secured by Liens on the
assets of the relevant Guarantor as provided in this Agreement and the other
Collateral Documents; and
WHEREAS, upon any foreclosure or other enforcement of the Collateral
Documents, the net proceeds of the relevant Collateral are to be received by or
paid over to the Collateral Agent and applied as provided in Section 15 of this
Agreement;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. Definitions. Terms defined in the Credit Agreement and not
otherwise defined herein have, as used herein, the respective meanings provided
for therein. The following additional terms, as used herein, have the following
meanings:
"Account Control Agreement" means an agreement among the Borrower, a
Concentration Account Bank, the Collateral Agent and the Exit Facility
Collateral Agent pursuant to which the Concentration Accounts are maintained,
such agreement to be substantially in the form of Exhibit H hereto or in any
other form agreed to by the parties thereto.
"Accounts" means, with respect to any Lien Grantor, all "accounts" (as
defined in the UCC) now owned or hereafter acquired by such Lien Grantor, and
also means and includes all accounts receivable, contract rights, book debts,
notes, drafts and other obligations or indebtedness owing to such Lien Grantor
arising from the performance of services by it and/or the sale, lease or
exchange of goods or other property by it (including, without limitation, any
such obligation or indebtedness which might be characterized as an account,
contract right or general intangible under the Uniform Commercial Code in effect
in any applicable jurisdiction) and all of such Lien Grantor's rights in, to and
under all contracts or purchase orders for goods, services or other property,
and all of such Lien Grantor's rights to any goods, services or other property
represented by any of the foregoing and all monies due to or to become due to
such Lien Grantor under all contracts for the performance of services by it
and/or the sale, lease or exchange of goods or other property by it (whether or
not yet earned by performance on the part of such Lien Grantor), in each case
whether now existing or hereafter arising or acquired, including, without
limitation, the right to receive the proceeds of said contracts and purchase
orders and all collateral security and guarantees of any kind given by any
Person with respect to any of the foregoing; provided that the term "Accounts"
shall not include such Lien Grantor's right, title and interest in and to any
Retained Collection Rights.
"Cash Distributions" means dividends, interest and other payments and
distributions made in cash upon or with respect to the Collateral.
2
"Chattel Paper" means "chattel paper" (as defined in the UCC).
"Collateral" means all property, whether now owned or hereafter
acquired, in which a security interest or other Lien is granted or purported to
be granted to the Collateral Agent pursuant to the Collateral Documents. When
used with respect to a specific Lien Grantor, the term "Collateral" means all
such property in which such a security interest or other Lien is granted or
purported to be granted to the Collateral Agent by such Lien Grantor.
"Collateral Accounts" means the Reduction Event Account and the
Collateral Proceeds Accounts.
"Collateral Agent" means Xxxxxx Guaranty Trust Company of New York, in
its capacity as Collateral Agent for the holders of the Secured Obligations
under the Collateral Documents, and its successors in such capacity.
"Collateral Documents" means this Agreement, the Security Agreement
Supplements, the Mortgages, the Account Control Agreements, the Intellectual
Property Security Agreements and all other supplemental or additional security
agreements, mortgages or similar instruments delivered pursuant hereto or
thereto.
"Collateral Proceeds Account" has the meaning set forth in Section
7(d).
"Concentration Account Bank" has the meaning set forth in Section 6(a).
"Concentration Accounts" has the meaning set forth in Section 6(a).
"Copyright License" means any agreement now or hereafter in existence
granting to any Lien Grantor, or pursuant to which any Lien Grantor has granted
to any other Person, any right to use, copy, reproduce, distribute, prepare
derivative works, display or publish any records or other materials on which a
Copyright is in existence or may come into existence, including, without
limitation, any agreement identified in Schedule 1 to a Copyright Security
Agreement.
"Copyrights" means all the following: (i) all copyrights under the laws
of the United States or any other country (whether or not the underlying works
of authorship have been published), all registrations and recordings thereof,
all copyrightable works of authorship (whether or not published), and all
applications for copyrights under the laws of the United States or any other
country, including, without limitation, registrations, recordings and
applications in the United States Copyright Office or in any similar office or
agency of the United States, any State
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thereof or any other country or any political subdivision thereof, including,
without limitation, those described in Schedule 1 to any Copyright Security
Agreement, (ii) all renewals thereof, (iii) all claims for, and rights to xxx
for, past or future infringements of any of the foregoing, and (iv) all income,
royalties, damages and payments now or hereafter due or payable with respect to
any of the foregoing, including, without limitation, damages and payments for
past or future infringements thereof.
"Copyright Security Agreement" means a Second Priority Copyright
Security Agreement, substantially in the form of Exhibit B hereto, executed and
delivered by a Lien Grantor in favor of the Collateral Agent, for the benefit of
the Secured Parties, as amended from time to time.
"Credit Agreement" means the $300,000,000 Credit Agreement dated as of
April 20, 2001 among Vencor Operating, Inc. (to be renamed Kindred Healthcare
Operating, Inc.), Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), the
Lenders party thereto and Xxxxxx Guaranty Trust Company of New York, as
Administrative Agent and Collateral Agent, as amended from time to time.
"Documents" means, with respect to any Lien Grantor, all "documents"
(as defined in the UCC) or other receipts covering, evidencing or representing
goods, now owned or hereafter acquired by such Lien Grantor.
"Enforcement Notice" means a notice delivered to the Collateral Agent
by the Administrative Agent pursuant to Section 8.03 of the Credit Agreement
directing the Collateral Agent to exercise one or more specific rights or
remedies under the Collateral Documents.
"Equipment" means, with respect to any Lien Grantor, all "equipment"
(as defined in the UCC) now owned or hereafter acquired by it, wherever located.
"Equity Interest" means (i) in the case of a corporation, any shares of
its capital stock, (ii) in the case of a limited liability company, any
membership interest therein, (iii) in the case of a partnership, any partnership
interest (whether general or limited) therein, (iv) in the case of any other
business entity, any participation or other interest in the equity or profits
thereof or (v) any warrant, option or other right to acquire any Equity Interest
described in the foregoing clauses (i), (ii), (iii) and (iv).
"Existing Intellectual Property" means, with respect to any Original
Lien Grantor, all Intellectual Property owned by or licensed to such Lien
Grantor as of the Closing Date.
4
"Future Intellectual Property" means, with respect to any Lien Grantor
at any time after the Closing Date, any Intellectual Property owned by or
licensed to such Lien Grantor at such time, other than its Existing Intellectual
Property.
"General Intangibles" means, with respect to any Lien Grantor, all
"general intangibles" (as defined in the UCC) now owned or hereafter acquired by
such Lien Grantor, including, without limitation, (i) all obligations or
indebtedness owing to such Lien Grantor (other than Accounts) from whatever
source arising, (ii) all Intellectual Property, goodwill, trade names, service
marks, trade secrets, permits and licenses, (iii) all rights or claims in
respect of refunds for taxes paid and (iv) all rights in respect of any pension
plan or similar arrangement maintained for employees of any member of the ERISA
Group.
"Goods" means, with respect to any Lien Grantor, all "goods" (as
defined in the UCC) now owned or hereafter acquired by it, wherever located.
"Instruments" means, with respect to any Lien Grantor, all
"instruments", or "letters of credit" (each as defined in the UCC) or Chattel
Paper evidencing, representing, arising from or existing in respect of, relating
to, securing or otherwise supporting the payment of, any Account or other
obligation or indebtedness owing to such Lien Grantor, including (but not
limited to) promissory notes, drafts, bills of exchange and trade acceptances,
now owned or hereafter acquired by such Lien Grantor.
"Intellectual Property" means (i) Patents, (ii) Patent Licenses, (iii)
Trademarks, (iv) Trademark Licenses, (v) Copyrights and (vi) Copyright Licenses,
and all rights in or under any of the foregoing.
"Intellectual Property Filing" means (i) with respect to any Patent,
Patent License, Trademark or Trademark License, the filing of the applicable
Patent Security Agreement or Trademark Security Agreement with the United States
Patent and Trademark Office, together with an appropriately completed
recordation form, and (ii) with respect to any Copyright or Copyright License,
the filing of the applicable Copyright Security Agreement with the United States
Copyright Office, together with an appropriately completed recordation form, in
each case sufficient to record the Security Interest granted to the Collateral
Agent in such Intellectual Property.
"Intellectual Property Security Agreement" means a Copyright Security
Agreement, a Patent Security Agreement or a Trademark Security Agreement.
"Inventory" means, with respect to any Lien Grantor, all "inventory"
(as defined in the UCC), now owned or hereafter acquired by it, wherever
located.
5
"Lien Grantor" means the Issuer, Vencor or any Subsidiary Guarantor and
"Lien Grantors" means all of the foregoing.
"Liquid Investments" has the meaning set forth in Section 7(f).
"Medicaid Receivable" means any Account with respect to which the
obligor is a state governmental authority (or agent thereof) obligated to pay,
pursuant to federal or state Medicaid program statutes or regulations, for
services rendered to eligible beneficiaries thereunder.
"Medicare Receivable" means any Account with respect to which the
obligor is a federal governmental authority (or agent thereof) obligated to pay,
pursuant to federal Medicare program statutes or regulations, for services
rendered to eligible beneficiaries thereunder.
"Opinion of Counsel" means a written opinion of legal counsel (who may
be counsel to a Lien Grantor or other counsel, in either case approved by the
Administrative Agent or the Required Lenders in a writing delivered to the
Collateral Agent) addressed and delivered to the Collateral Agent.
"Original Lien Grantor" means the Issuer, Vencor or any Subsidiary
Guarantor that grants a Lien on any of its assets hereunder on the Closing Date,
and "Original Lien Grantors" means all of the foregoing.
"Patent License" means any agreement now or hereafter in existence
granting any Lien Grantor, or pursuant to which any Lien Grantor has granted to
any other Person, any right with respect to any Patent or any invention now or
hereafter in existence, whether patentable or not, whether a patent or
application for patent is in existence on such invention or not, and whether a
patent or application for patent on such invention may come into existence or
not, including, without limitation, any agreement identified in Schedule 1 to a
Patent Security Agreement.
"Patents" means (i) all letters patent and design letters patent of the
United States or any other country and all applications (other than the
Provisional Application but only for so long as such Provisional Application
remains a provisional application) for letters patent and design letters patent
of the United States or any other country, including, without limitation,
applications in the United States Patent and Trademark Office or in any similar
office or agency of the United States, any State thereof or any other country or
any political subdivision thereof, (ii) all reissues, divisions, continuations,
continuations-in-part, revisions and extensions thereof, (iii) all claims for,
and rights to xxx for, past or future infringements of any of the foregoing and
(iv) all
6
income, royalties, damages and payments now or hereafter due or payable with
respect to any of the foregoing, including, without limitation, damages and
payments for past or future infringements thereof.
"Patent Security Agreement" means a Second Priority Patent Security
Agreement, substantially in the form of Exhibit C hereto, executed and delivered
by a Lien Grantor in favor of the Collateral Agent, for the benefit of the
Secured Parties, as amended from time to time.
"Perfection Certificate" means, with respect to any Lien Grantor, a
certificate substantially in the form of Exhibit E hereto, completed and
supplemented with the schedules and attachments contemplated thereby to the
satisfaction of the Collateral Agent, and duly executed by a duly authorized
officer of such Lien Grantor, provided that in the case of Perfection
Certificates required to be delivered in connection with the Closing, such
requirements may be satisfied as to all Lien Grantors through the delivery on
their behalf by the Issuer of Perfection Certificates pursuant to the Senior
Security Agreement (so long as such Perfection Certificates refer to this
Agreement and copies of such Perfection Certificates are simultaneously
delivered to the Collateral Agent), duly executed by a Financial Officer, that
sets forth in a form satisfactory to the Collateral Agent all of the information
required to be provided.
"Permitted Liens" means (i) the Security Interests and (ii) the other
Liens on the Collateral permitted to be created or assumed or to exist pursuant
to Section 7.02 of the Credit Agreement.
"Personal Property Collateral" means at any time, with respect to any
Lien Grantor, all its property included in the Collateral at such time, other
than its Real Property Collateral.
"Personal Property Security Interests" means the security interests in
Personal Property Collateral granted by the Lien Grantors under the Collateral
Documents.
"Pledged Equity Interests" means at any time all Equity Interests
included in the Collateral at such time.
"Pledged Equity Securities" means at any time all "certificated
securities" (as such term is defined in Article 8 of the UCC) that evidence or
represent Pledged Equity Interests at such time.
"Pledged Instruments" means at any time all Instruments included in the
Collateral at such time.
7
"Pledged LLC Interest" means at any time any membership interest or
similar interest in a limited liability company that is included in the Pledged
Equity Interests at such time.
"Pledged Partnership Interest" means at any time any partnership
interest (whether general or limited) that is included in the Pledged Equity
Interests at such time.
"Post-Petition Interest" means any interest which accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Issuer, whether or not such interest is
allowed or allowable as a claim in any such proceeding.
"Proceeds" means, with respect to any Lien Grantor, all proceeds of,
and all other profits, products, rents or receipts, in whatever form, arising
from the collection, sale, lease, exchange, assignment, licensing or other
disposition of, or other realization upon, its Collateral, including without
limitation all claims of such Lien Grantor against third parties for loss of,
damage to or destruction of, or for proceeds payable under, or unearned premiums
with respect to, policies of insurance in respect of, any of its Collateral, and
any condemnation or requisition payments with respect to any of its Collateral,
in each case whether now existing or hereafter arising.
"Provisional Application" means the provisional application for a
patent entitled "A method and system for tracking medical claims which are under
review or have been denied" filed with the United States Patent and Trademark
Office on September 9, 2000 (Registration Number 42,923; Docket Number
VE075/OVE12).
"Real Property Collateral" means at any time, with respect to any Lien
Grantor, all its real property (including leasehold interests in real property)
included in the Collateral at such time.
"Real Property Security Interests" means the security interests in Real
Property Collateral granted by the Lien Grantors under the Mortgages and the
other Collateral Documents.
"Reduction Event Account" has the meaning set forth in Section 7(a).
"Retained Collection Rights" means, with respect to any Medicaid
Receivable, Medicare Receivable or VA Receivable of any Lien Grantor, the right
of such Lien Grantor to collect and receive from the obligor thereon payments in
8
respect of such Account in the absence of a court order requiring such obligor
to submit payments thereon directly to a Person other than such Lien Grantor.
"Secured Obligations" means:
(a) with respect to the Issuer, all Obligations, including principal
of all Loans outstanding from time to time under the Credit Agreement, all
interest (including Post-Petition Interest) on such Loans, and all other amounts
now or hereafter payable by the Issuer pursuant to any Financing Document;
(b) with respect to Vencor, all obligations of Vencor under the Vencor
Guaranty Agreement and all amounts now or hereafter payable by Vencor under any
other Financing Document; and
(c) with respect to any Subsidiary Guarantor, (i) all obligations of
such Subsidiary Guarantor under its Subsidiary Guaranty Agreement and (ii) all
other obligations of such Subsidiary Guarantor under or in respect of the
Financing Documents.
"Secured Parties" means the holders from time to time of the Secured
Obligations.
"Secured Parties Requesting Notice" means, at any time, each Secured
Party which has, at least five Business Days prior thereto, delivered to the
Collateral Agent a written notice (a) stating that it holds one or more Secured
Obligations and wishes to receive copies of the notices referred to in Section
16(i) and (b) setting forth its address or facsimile number to which copies of
such notices should be sent.
"Security Agreement Supplement" means a Second Priority Security
Agreement Supplement, substantially in the form of Exhibit A hereto, executed
and delivered to the Collateral Agent pursuant to Section 19 for the purpose of
adding a new Subsidiary Guarantor as a party hereto and/or adding additional
property to the Collateral.
"Security Interests" means the Personal Property Security Interests and
the Real Property Security Interests.
"Senior Collateral Agent" means Xxxxxx Guaranty Trust Company of New
York, in its capacity as collateral agent under the Senior Financing Documents,
and its successors.
9
"Senior Collateral Documents" means the Senior Security Agreement, the
Senior Security Agreement Supplements, the Senior Mortgages and all other
supplemental or additional security agreements (including all intellectual
property security agreements), mortgages or similar instruments delivered
pursuant thereto or pursuant to the Senior Credit Agreement.
"Senior Credit Agreement" means the $120,000,000 Credit Agreement dated
as of the date hereof among the Issuer, Vencor, the Lenders, Swingline Bank and
LC Issuing Banks party thereto, Xxxxxx Guaranty Trust Company of New York as
Senior Collateral Agent and administrative agent, and General Electric Capital
Corporation, as documentation agent and collateral monitoring agent, and any
refinancings, refundings or renewals thereof.
"Senior Fee Mortgages" means fee mortgages relating to any real
properties owned in fee by the Issuer or any Guarantor in favor of the Senior
Collateral Agent.
"Senior Financing Documents" means the Senior Credit Agreement
(including the Schedules and Exhibits thereto), the Senior Notes, the Senior
Guaranty Agreements, the Senior Collateral Documents and the Intercreditor
Agreement.
"Senior Guaranty Agreements" means the Senior Vencor Guaranty Agreement
and the Senior Subsidiary Guaranty Agreements.
"Senior Leasehold Mortgages" means leasehold mortgages relating to any
real properties leased by the Issuer or any Guarantor in favor of the Senior
Collateral Agent.
"Senior Mortgages" means the Senior Leasehold Mortgages and the Senior
Fee Mortgages, collectively.
"Senior Notes" means the senior secured notes of the Issuer issued to
the lenders party to the Senior Credit Agreement.
"Senior Security Agreement" means the Senior Security Agreement dated
as of the date hereof among the Issuer, the Guarantors party thereto and the
Senior Collateral Agent, as amended from time to time, and any replacement or
successor agreement relating to any refinancing, refunding or renewal of the
Senior Credit Agreement.
"Senior Security Agreement Supplement" means a Senior Security
Agreement Supplement whereby the Issuer or a Guarantor grants (or confirms its
10
grant of) a security interest in additional collateral to the Senior Collateral
Agent and, if the grantor of such security interest is a Subsidiary Guarantor
that is not already a party to the Senior Security Agreement, such Subsidiary
Guarantor becomes a party thereto.
"Senior Subsidiary Guaranty Agreements" means the Senior Subsidiary
Guaranty Agreements setting forth the guarantees by the Subsidiary Guarantors
party thereto that the Issuer will perform its obligations under the Senior
Financing Documents.
"Senior Vencor Guaranty Agreement" means the Senior Vencor Guaranty
Agreement dated as of the date hereof setting forth the guaranty by Vencor that
the Issuer will perform its obligations under the Senior Financing Documents,
and any replacement or successor agreement relating to any refinancing,
refunding or renewal of the Senior Credit Agreement.
"Subsidiary Guarantors" means each Person listed on the signature pages
hereof under the caption "Subsidiary Guarantors" and each Person that shall, at
any time after the date hereof, become a party hereto and a "Subsidiary
Guarantor" as provided in Section 19.
"Trademark License" means any agreement now or hereafter in existence
granting to any Lien Grantor, or pursuant to which any Lien Grantor has granted
to any other Person, any right to use any Trademark, including, without
limitation, any agreement identified in Schedule 1 to any Trademark Security
Agreement.
"Trademarks" means: (i) all trademarks, trade names, corporate names,
company names, business names, fictitious business names, trade styles, service
marks, logos, brand names, trade dress, prints and labels on which any of the
foregoing have appeared or appear, package and other designs, and any other
source or business identifiers, and general intangibles of like nature, and the
rights in any of the foregoing which arise under applicable law, (ii) the
goodwill of the business symbolized thereby or associated with each of them,
(iii) all registrations and applications in connection therewith, including,
without limitation, registrations and applications in the United States Patent
and Trademark Office or in any similar office or agency of the United States,
any State thereof or any other country or any political subdivision thereof,
including, without limitation, those described in Schedule 1 to any Lien
Grantor's Trademark Security Agreement, (iv) all renewals thereof, (v) all
claims for, and rights to xxx for, past or future infringements of any of the
foregoing and (vi) all income, royalties, damages and payments now or hereafter
due or payable with respect to any of the foregoing, including, without
limitation, damages and payments for past or future infringements thereof.
11
"Trademark Security Agreement" means a Second Priority Trademark
Security Agreement, substantially in the form of Exhibit D hereto, executed and
delivered by a Lien Grantor in favor of the Collateral Agent, for the benefit of
the Secured Parties, as amended from time to time.
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York; provided that if, by reason of mandatory provisions of
law, the perfection or the effect of perfection or non-perfection of any
Security Interest in any Collateral is governed by the Uniform Commercial Code
as in effect in a jurisdiction other than New York, "UCC" means the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such perfection or effect of perfection or
non-perfection.
"VA Receivable" means any Account with respect to which the obligor is
the Veterans' Administration or any successor thereto (or any agent thereof).
Section 2. Representations and Warranties. Each Original Lien Grantor
represents and warrants that:
(a) As of the Closing Date, such Original Lien Grantor owns the Equity
Interests listed as being owned by it in Schedule 1 to the Credit Agreement,
free and clear of any Lien other than Permitted Liens. All shares of capital
stock identified in such Schedule as being beneficially owned by such Original
Lien Grantor have been duly authorized and validly issued, are fully paid and
non-assessable, and are subject to no option to purchase or similar right of any
Person. Such Original Lien Grantor is not and will not become a party to or
become otherwise bound by any agreement, other than the Financing Documents and
the Senior Financing Documents, which restricts in any manner the rights of any
present or future holder of any Pledged Equity Interest with respect thereto.
(b) Such Original Lien Grantor has good and marketable title to all of
its Collateral (except Intellectual Property), free and clear of any Liens other
than Permitted Liens. To the best of its knowledge, such Original Lien Grantor
has good title or other rights in and to its Existing Intellectual Property,
free and clear of any Liens other than Permitted Liens. Such Original Lien
Grantor has taken all actions necessary under the UCC to perfect its interest in
any Accounts purchased or otherwise acquired by it, as against its assignors and
creditors of its assignors.
(c) Other than granting Permitted Liens, such Original Lien Grantor
has not performed any acts that might prevent the Collateral Agent from
enforcing any of the provisions of the Collateral Documents or that would limit
the Collateral Agent in any such enforcement. No financing statement, security
agreement,
12
mortgage or similar or equivalent document or instrument covering all or any
part of the Collateral owned by it is on file or of record in any jurisdiction
in which such filing or recording would be effective to perfect or record a Lien
on such Collateral, except financing statements, mortgages or other similar or
equivalent documents with respect to (i) Liens under the DIP Facility and the
Pre-Petition Senior Credit Agreement (so long as arrangements reasonably
satisfactory to the Collateral Agent have been made for the termination of such
financing statements, mortgages or other similar or equivalent documents on or
promptly after the Closing Date) and (ii) Permitted Liens. After the Closing, no
Collateral owned by it will be in the possession of any Person (other than such
Original Lien Grantor) asserting any claim thereto or security interest therein
(except Permitted Liens), except that (A) the Senior Collateral Agent or its
designee may have possession of Collateral as contemplated by the Senior
Collateral Documents and the Intercreditor Agreement or the Collateral Agent or
its designee may have possession of Collateral as contemplated hereby and (B)
cash and Temporary Cash Investments may be held in the Concentration Accounts.
(d) Such Original Lien Grantor has delivered a Perfection Certificate
to the Collateral Agent. The information set forth therein is correct and
complete as of the Closing Date.
(e) The Personal Property Security Interests constitute valid security
interests in all Personal Property Collateral owned by such Original Lien
Grantor thereby securing its Secured Obligations, and constitute security
interests therein prior to all other Liens other than Liens permitted under the
Credit Agreement to be senior in priority to the Liens of the Lenders.
(f) Upon the delivery of the Pledged Instruments (if any) and the
Pledged Equity Securities owned by such Original Lien Grantor to the Collateral
Agent in accordance with Section 4, the Collateral Agent will have valid and
perfected security interests in such Collateral subject to no prior Lien other
than Permitted Liens.
(g) When UCC financing statements shall have been filed in the offices
specified in such Original Lien Grantor's Perfection Certificate, the Personal
Property Security Interests will constitute perfected security interests in the
Personal Property Collateral owned by such Original Lien Grantor to the extent
that a security interest therein may be perfected by filing pursuant to the UCC,
prior (except in the case of Intellectual Property) to all Liens and rights of
others therein except Permitted Liens. When, in addition to the filing of such
UCC financing statements, the applicable Intellectual Property Filings have been
made with respect to such Lien Grantor's Intellectual Properties (including any
future filings required pursuant to Sections 5(c) and 5(d)), the Personal
Property Security
13
Interests will constitute perfected security interests in all right, title and
interest of such Original Lien Grantor in its Intellectual Property to the
extent that security interests therein may be perfected by such filings and, to
the best of such Original Lien Grantor's knowledge, such security interests will
be prior to all other Liens and rights of others therein except Permitted Liens.
Except for (i) the filing of such UCC financing statements, (ii) such
Intellectual Property Filings, (iii) the due recordation of memoranda of lease
with respect to the Master Lease Agreements and any assignment thereof to the
Issuer and (iv) the due recordation of the Fee Mortgages and the Leasehold
Mortgages, no registration, recordation or filing with any governmental body,
agency or official is required in connection with the execution or delivery of
the Collateral Documents or is necessary for the validity or enforceability
thereof or for the perfection or due recordation of the Security Interests or
(except with respect to the capital stock of any Insurance Subsidiary) for the
enforcement of the Security Interests.
(h) Such Original Lien Grantor's Collateral is insured in accordance
with the requirements of the Credit Agreement.
Section 3. The Security Interests.
(a) In order to secure the full and punctual payment of its Secured
Obligations in accordance with the terms thereof, each Lien Grantor hereby
grants to the Collateral Agent for the benefit of the Secured Parties a
continuing security interest in and to all of the following property of such
Lien Grantor, whether now owned or existing or hereafter acquired or arising and
regardless of where located:
(i) all Accounts;
(ii) all Documents;
(iii) all Equipment;
(iv) all General Intangibles;
(v) all Goods;
(vi) all Instruments;
(vii) all Inventory;
(viii) all Chattel Paper;
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(ix) all Equity Interests in other Persons now or hereafter
beneficially owned by such Lien Grantor, all rights and
privileges of such Lien Grantor with respect to such Equity
Interests, and all dividends, distributions and other payments
with respect thereto;
(x) all books and records (including, without limitation,
customer lists, credit files, computer programs, printouts and
other computer materials and records) of such Lien Grantor
pertaining to any of its Collateral;
(xi) such Lien Grantor's ownership interest in the
Collateral Accounts, all cash deposited therein from time to
time, all Liquid Investments made with amounts on deposit therein
and all of such Lien Grantor's other monies and property of any
kind in the possession or under the control of the Collateral
Agent; and
(xii) all Proceeds of the collateral described in the
foregoing clauses (i) through (xi);
provided that the following property is excluded from the foregoing security
interests: (i) motor vehicles, (ii) deposit accounts (other than the Collateral
Accounts and the Concentration Accounts), (iii) subject to Section 5.12(c) of
the Credit Agreement, Equity Interests in Cornerstone, (iv) Instruments retained
for collection pursuant to Section 4(d), (v) promissory notes outstanding on the
Closing Date and evidencing loans made by either Vencor or the Issuer to current
and former officers of Vencor not exceeding $16,000,000 in aggregate principal
amount and (vi) any Equity Interests, general intangibles or other rights
arising under or subject to any contracts, instruments, licenses or other
documents if (but only to the extent that) the grant of a security interest
therein would constitute a material violation of a valid and enforceable
restriction in favor of a third party, unless and until any required consents
shall have been obtained. Each Lien Grantor shall use all reasonable efforts to
obtain any such required consent that is reasonably obtainable; provided that no
Lien Grantor shall be obligated to obtain any such consent with respect to any
Retained Collection Rights or Third Party Lease.
(b) The Security Interests are granted as security only and
shall not subject the Collateral Agent or any other Secured Party to, or
transfer or in any way affect or modify, any obligation or liability of any Lien
Grantor with respect to any of the Collateral or any transaction in connection
therewith.
(c) If the superintendent of insurance or other similar official
having jurisdiction over any Insurance Subsidiary determines that any pledge of
the
15
shares of capital stock of such Insurance Subsidiary hereunder constitutes
the acquisition of or a change of control with respect to such Insurance
Subsidiary as to which the prior approval of such superintendent or similar
official was required, then, immediately upon the relevant Lien Grantor's (1)
written memorialization of oral notice or (2) receipt of written notice from
such official of such determination and without any action on the part of the
Collateral Agent or any other Person, such pledge shall be rendered void ab
initio and of no effect. Upon any such occurrence, (i) the Collateral Agent
shall, at such Lien Grantor's written request and expense, if then in its
possession, return the certificates representing such capital stock to such Lien
Grantor and execute and deliver such documents as such Lien Grantor shall
reasonably request to evidence such Lien Grantor's retention of all rights in
such capital stock and (ii) such Lien Grantor shall promptly submit a request to
the superintendent of insurance or other appropriate official for approval of
the pledge of such shares to the Collateral Agent hereunder and, upon receipt of
such approval, shall forthwith pledge and deposit with the Collateral Agent
certificates representing all of the outstanding shares of capital stock of such
Insurance Subsidiary to be held as Pledged Equity Securities subject to all
relevant provisions of this Agreement.
(d) The Issuer shall not, and shall not permit any other Lien Grantor
to, create, assume or suffer to exist any Lien on the Provisional Application or
any interest relating thereto, other than any Lien in favor of the Collateral
Agent and the Exit Facility Collateral Agent.
Section 4. Delivery of Certain Collateral. (a) On the Closing Date,
each Original Lien Grantor is delivering to the Collateral Agent as Collateral
hereunder all stock certificates or other certificates representing Equity
Interests in other Persons then owned by it, provided that such delivery will be
deemed to be made to the extent any such certificate is already held by Xxxxxx
in its capacity as collateral agent under the Pre-Petition Senior Credit
Agreement and DIP Facility.
(b) On the date it signs and delivers its Security Agreement
Supplement, each Lien Grantor (other than an Original Lien Grantor) will deliver
to the Collateral Agent as Collateral hereunder all stock certificates or other
certificates representing Equity Interests in other Persons then owned by it.
(c) After the Closing Date (in the case of an Original Lien Grantor)
or the date of its Security Agreement Supplement (in the case of any other Lien
Grantor), if any Lien Grantor receives (i) any stock certificate or other
certificate representing Equity Interests in another Person then owned by it or
(ii) any Instrument, in each case in which a security interest is granted
pursuant to Section 3 hereof or pursuant to the Security Agreement Supplement
signed by it, such
16
Lien Grantor will immediately deliver such certificate or Instrument to the
Collateral Agent to be held by it as Collateral hereunder.
(d) Notwithstanding the foregoing, so long as no Event of Default
shall have occurred and be continuing, each Lien Grantor may retain for
collection in the ordinary course any Instruments received by it in the ordinary
course of business, and the Collateral Agent shall, promptly upon request by
such Lien Grantor, make appropriate arrangements for making any other Instrument
pledged by such Lien Grantor hereunder available to it for purposes of
presentation, collection or renewal (any such arrangement to be effected, to the
extent deemed appropriate by the Collateral Agent, against trust receipt or like
document).
(e) All Pledged Equity Securities delivered to the Collateral Agent
hereunder will be delivered in suitable form for transfer by delivery, or
accompanied by duly executed instruments of transfer or assignment in blank, all
in form and substance satisfactory to the Collateral Agent. All Pledged
Instruments delivered to the Collateral Agent hereunder will be endorsed to the
order of the Collateral Agent, or accompanied by duly executed instruments of
assignment, all in form and substance satisfactory to the Collateral Agent.
(f) Notwithstanding the foregoing, no certificate or Instrument shall
be required to be delivered to the Collateral Agent by a Lien Grantor if and so
long as such certificate or Instrument is required to be delivered to and held
by the Senior Collateral Agent.
Section 5. Further Assurances; Covenants. Each Lien Grantor covenants
as follows:
(a) It will not change its name, identity or corporate structure in
any manner unless permitted by Section 7.03 of the Credit Agreement and unless
such Lien Grantor shall have given the Collateral Agent prior notice thereof and
either (i) delivered an updated Perfection Certificate to the Collateral Agent
or (ii) certified to the Collateral Agent that the Perfection Certificate most
recently delivered pursuant to this Agreement is correct and complete as of the
date of such notice; provided that the Issuer may change its name to "Kindred
Healthcare Operating, Inc." and Vencor may change its name to "Kindred
Healthcare, Inc." on the Closing Date.
(b) It will not change the location of (i) its chief executive office
or chief place of business or (ii) the locations where it keeps or holds any
Collateral or any records relating thereto from the applicable locations
described in its Perfection Certificate (after the delivery of such Perfection
Certificate), unless such Lien Grantor shall have given the Collateral Agent
prior notice thereof. It will not in
17
any event change the location of any Collateral owned by it if such change would
cause the Security Interests in such Collateral to lapse or, if perfected prior
to such change of location, cease to be perfected.
(c) (i) It will, from time to time, at its expense, execute, deliver,
file and record any statement, assignment, instrument, document, agreement or
other paper and take any other action (including, without limitation, any
Intellectual Property Filings and any filings of financing or continuation
statements under the UCC) that from time to time may be necessary or desirable,
or that the Collateral Agent may reasonably request, in order to create,
preserve, perfect, confirm or validate the Security Interests in such Lien
Grantor's Collateral or to enable the Collateral Agent and the other Secured
Parties to obtain the full benefits of the Collateral Documents, or to enable
the Collateral Agent to exercise and enforce any of its rights, powers and
remedies thereunder with respect to any of such Lien Grantor's Collateral. To
the extent permitted by applicable law, such Lien Grantor authorizes the
Collateral Agent to execute and file such financing statements or continuation
statements without such Lien Grantor's signature appearing thereon. Such Lien
Grantor agrees that a carbon, photographic, photostatic or other reproduction of
this Agreement or of a financing statement is sufficient as a financing
statement. Such Lien Grantor shall pay the costs of, or incidental to, any
recording or filing of any such financing or continuation statements in which it
is named as the debtor. Such Lien Grantor hereby constitutes the Collateral
Agent its attorney-in-fact to execute and file all Intellectual Property Filings
required or so requested for the foregoing purposes, all acts of such attorney
being hereby ratified and confirmed; and such power, being coupled with an
interest, shall be irrevocable until such Lien Grantor's Collateral is released
pursuant to Section 18.
(ii) Without limiting clause (i), it will enter into any
amendments to this Agreement and to any other Financing Document and
take any other action, at its expense, that the Collateral Agent may
reasonably request or as may be necessary or desirable in connection
with the proposed revisions to Article 9 of the UCC, in order to
create, preserve, perfect, confirm or validate the Security Interests
in such Lien Grantor's Collateral or to enable the Collateral Agent
and the other Secured Parties to obtain the full benefits of the
Collateral Documents, or to enable the Collateral Agent to exercise
and enforce any of its rights, powers and remedies thereunder with
respect to any of such Lien Grantor's Collateral.
(d) Within 30 days after each March 31 and September 30
(commencing with the first such date to occur after the Closing Date), it will
(i) sign and deliver to the Collateral Agent any Intellectual Property Security
Agreement necessary to grant Security Interests in any Intellectual Properties
18
owned by it on such March 31 or September 30 that are not covered by the
Security Interests granted in any previous Intellectual Property Security
Agreements so signed and delivered by it and (ii) make all Intellectual Property
Filings reasonably necessary to record the Security Interests in such
Intellectual Properties.
(e) At least 30 days before it takes any action contemplated by
Section 5(a) or 5(b), such Lien Grantor will, at its expense, cause to be
delivered to the Collateral Agent an officer's certificate, in form and
substance satisfactory to the Collateral Agent, to the effect that all financing
statements and amendments or supplements thereto, continuation statements and
other documents required to be recorded or filed in order to perfect and protect
the Security Interests against all creditors of and purchasers from such Lien
Grantor (except any continuation statements specified in such officer's
certificate that are to be filed more than six months after the date thereof)
have been filed in each filing office necessary for such purpose and that all
filing fees and taxes, if any, payable in connection with such filings have been
paid in full; provided that if the only action contemplated is a change in the
name of a Lien Grantor to the name set forth below the name of such Lien Grantor
on the Perfection Certificate delivered in connection with the Closing, then
such Lien Grantor will at its expense (i) cause to be delivered to the
Collateral Agent an officer's certificate, in form and substance satisfactory to
the Collateral Agent, specifying the date on which such name change is to take
effect (the "Effective Date") (such certificate to be delivered to the
Collateral Agent at least three days prior to the Effective Date) and (ii)
deliver to the Collateral Agent no later than June 20, 2001, all financing
statements and amendments or supplements thereto, continuation statements and
other documents required to be recorded or filed in order to perfect and protect
the Security Interests against all creditors of and purchasers from such Lien
Grantor and evidence satisfactory to the Collateral Agent that such financing
statements and amendments or supplements thereto, continuation statements and
other documents will be filed in each filing office necessary for such purpose
by June 30, 2001 and that all filing fees and taxes, if any, payable in
connection with such filings will be paid in full by such date.
(f) If any of its Collateral is at any time in the possession or
control of any warehouseman, bailee or agent, such Lien Grantor will notify such
warehouseman, bailee or agent of the Security Interests and instruct it to hold
all such Collateral for the Collateral Agent's account subject to the Collateral
Agent's instructions.
(g) It shall keep full and accurate books and records relating to its
Collateral, and stamp or otherwise xxxx such books and records in such manner
19
as the Collateral Agent may reasonably request in order to reflect the Security
Interests.
(h) It shall use its best efforts to cause to be collected from its
account debtors, as and when due, any and all amounts owing under or on account
of each of its Accounts (including, without limitation, Accounts which are
delinquent, such Accounts to be collected in accordance with lawful collection
procedures) and shall apply forthwith upon receipt thereof all such amounts as
are so collected to the outstanding balance of such Accounts. Subject to the
rights of the Collateral Agent and the other Secured Parties hereunder if an
Event of Default shall have occurred and be continuing, such Lien Grantor may
allow in the ordinary course of business as adjustments to amounts owing under
its Accounts (i) an extension or renewal of the time or times of payment, or
settlement for less than the total unpaid balance, which such Lien Grantor finds
appropriate in accordance with sound business judgment and (ii) refunds or
credits, all in accordance with such Lien Grantor's ordinary course of business
consistent with its historical collection practices. The costs and expenses
(including, without limitation, attorney's fees) of collection, whether incurred
by such Lien Grantor or the Collateral Agent, shall be borne by such Lien
Grantor.
(i) If an Enforcement Notice is in effect, such Lien Grantor will,
consistent with the terms of the Credit Agreement, if requested to do so by the
Collateral Agent, promptly notify (and such Lien Grantor hereby authorizes the
Collateral Agent so to notify) each account debtor in respect of any of its
Accounts or Instruments that such Collateral has been assigned to the Collateral
Agent hereunder, and that any payments due or to become due in respect of such
Collateral are to be made directly to the Collateral Agent or its designee.
(j) Such Lien Grantor will not sell, lease, exchange, assign or
otherwise dispose of, or grant any option with respect to, any of its
Collateral; provided that, unless an Enforcement Notice is in effect, (i) such
Lien Grantor may sell, lease or exchange its Inventory and obsolete, unused or
unnecessary Equipment, in each case in the ordinary course of business and (ii)
such Lien Grantor may sell any of its Collateral if (x) the sale thereof does
not violate any covenant in the Credit Agreement and (y) in the case of an Asset
Sale (other than the Kingfish Transaction), the Net Cash Proceeds thereof are
applied as provided in Section 2.06(a) of the Credit Agreement. Concurrently
with any sale or exchange (other than a sale or exchange to another Lien
Grantor) permitted by the foregoing proviso, the Security Interests in the
assets sold or exchanged (but not in any Proceeds arising from such sale or
exchange) shall cease immediately without any further action on the part of the
Collateral Agent or any other Secured Party.
20
(k) Such Lien Grantor will, promptly upon request, provide to the
Collateral Agent all information and evidence it may reasonably request
concerning its Collateral to enable the Collateral Agent to enforce the
provisions of the Collateral Documents.
(l) From time to time upon request by the Collateral Agent, such Lien
Grantor shall, at its expense, cause to be delivered to the Secured Parties an
Opinion of Counsel satisfactory to the Collateral Agent as to such matters
relating to the transactions contemplated hereby as the Required Lenders may
reasonably request.
(m) Such Lien Grantor shall notify the Collateral Agent promptly if it
knows that any application or registration relating to any material Intellectual
Property owned or licensed by it may become abandoned or dedicated, or of any
adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Copyright Office, the United States Patent and Trademark
Office or any court) regarding such Lien Grantor's ownership of such material
Intellectual Property, its right to register or patent the same, or its right to
keep and maintain the same. If any of such Lien Grantor's rights to any material
Intellectual Property are infringed, misappropriated or diluted by a third
party, such Lien Grantor shall notify the Collateral Agent within 30 days after
it learns thereof and shall, unless such Lien Grantor shall reasonably determine
that any such action would be of negligible value, economic or otherwise,
promptly xxx for infringement, misappropriation or dilution and to recover any
and all damages for such infringement, misappropriation or dilution, and take
such other actions as such Lien Grantor shall reasonably deem appropriate under
the circumstances to protect such Intellectual Property.
Section 6. Concentration Accounts. (a) The Issuer shall establish (or
transfer into the name of the Collateral Agent) one or more accounts
(collectively, the "Concentration Accounts") which shall be maintained in the
name of and under the exclusive control of the Collateral Agent and into which
collected cash owned by the Issuer and the other Lien Grantors shall be
deposited from time to time, provided that if and so long as the Issuer and the
other Lien Grantors are subject to and complying with requirements similar to
this Section 6 imposed by the Senior Collateral Documents, the Issuer and the
other Lien Grantors need not comply with the requirements of this Section 6 (and
the following subsections of this Section 6 shall be applied accordingly). Each
Concentration Account shall be maintained with a bank (a "Concentration Account
Bank") that (i) is reasonably acceptable to the Collateral Agent and (ii) if not
a Lender, enters into an Account Control Agreement. The Collateral Agent shall
instruct each Concentration Account Bank to transfer, from time to time, amounts
on deposit in each
21
Concentration Account maintained with it to such other account or accounts as
the Issuer may request, unless and until the Collateral Agent rescinds such
instructions. The Collateral Agent shall not rescind such instructions unless
requested to do so by the Required Lenders at a time when an Event of Default
shall have occurred and be continuing.
(b) Amounts on deposit in the Concentration Accounts may be invested
and re-invested from time to time in such Temporary Cash Investments as Vencor
or the Issuer shall determine from time to time; provided that, in order to
provide the Collateral Agent, for the benefit of the Secured Parties, with a
perfected security interest therein, (x) the books and records of the relevant
Concentration Account Bank shall reflect the fact that such Temporary Cash
Investments are held for the account of the Collateral Agent and (y) each such
Temporary Cash Investment either:
(i) is issued in the name of the relevant Concentration Account
Bank or evidenced by a negotiable certificate or instrument which
(together with any appropriate instrument of transfer) is delivered
to, and held by, such Concentration Account Bank or an agent thereof
(which shall not be any Lien Grantor or any of its Affiliates) in a
State where possession thereof perfects the Security Interest therein;
or
(ii) if not so issued or evidenced, is subject to pledge under
applicable law and regulations and as to which (in the opinion of
counsel to the Collateral Agent) appropriate measures shall have been
taken to perfect the relevant Security Interest.
All right, title and interest in and to the cash amounts on deposit from time to
time in the Concentration Accounts together with any Temporary Cash Investments
from time to time made pursuant to this subsection (b) shall vest in the
Collateral Agent, shall constitute part of the relevant Lien Grantor's
Collateral hereunder and shall not constitute payment of the Secured Obligations
unless and until applied thereto as provided in Section 15. If an Enforcement
Notice is in effect, the Collateral Agent may (i) instruct any Concentration
Account Bank to retain, in any Concentration Account maintained by it, all cash
and Temporary Cash Investments then held by it in such Concentration Account,
(ii) instruct such Concentration Account Bank to liquidate any or all Temporary
Cash Investments held by it in such Concentration Account and/or (iii) withdraw
any amounts held in any Concentration Account and apply such amounts in the
manner specified in Section 15.
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SECTION 7. Collateral Accounts. (a) Promptly after the Collateral
Agent determines that any Net Cash Proceeds of any Asset Sale (other than in
connection with the Kingfish Transaction) of the Issuer or a Restricted
Subsidiary or that any Casualty Proceeds with respect to property of the Issuer
or a Restricted Subsidiary are to be deposited pursuant to Section 2.06(a) of
the Credit Agreement, the Collateral Agent shall establish an account (such Lien
Grantor's "Reduction Event Account") with the Administrative Agent, in the name
and under the exclusive control of the Collateral Agent, into which all Net Cash
Proceeds with respect to Asset Sales (other than in connection with the Kingfish
Transaction) of such Lien Grantor and all Casualty Proceeds with respect to
property of such Lien Grantor shall be deposited from time to time, provided
that if and so long as the Issuer or any other Lien Grantor is subject to and
complying with requirements similar to Section 2.06(a) of the Senior Credit
Agreement, and in particular is required to deposit any Net Cash Proceeds of an
Asset Sale or any Casualty Proceeds with the Senior Collateral Agent, the Issuer
and the other Lien Grantors need not comply with the requirements of this
Section 7 (and the following subsections of this Section 7 shall be applied
accordingly).
(b) So long as no Enforcement Notice is in effect, Net Cash Proceeds
or Casualty Proceeds, as the case may be, to be released from a Reduction Event
Account pursuant to either clause (A) or (C) of Section 2.06(a) of the Credit
Agreement shall be released by the Collateral Agent to the relevant Lien Grantor
at such times and in such amounts as such Lien Grantor shall request in
accordance with the provisions of clause (A) or (C), as the case may be, of
Section 2.06(a) of the Credit Agreement. Any such request shall be accompanied
by a certificate of a Financial Officer describing in reasonable detail the
purpose for which such funds have been or will be expended and the date (which
shall not be later than 30 days after the date of such certificate) by which
such Lien Grantor is obligated or otherwise committed to make such payment,
provided that no such certificate shall be required if the aggregate Casualty
Proceeds requested for the restoration, repair, replacement or rebuilding of the
relevant assets is less than $100,000 with respect to any Casualty Event. If
immediately available cash on deposit in any Lien Grantor's Reduction Event
Account is not sufficient to make any such distribution to it, the Collateral
Agent shall cause to be liquidated, as promptly as practicable, such Liquid
Investments in such Reduction Event Account as shall be required to obtain
sufficient cash to make such distribution and, notwithstanding any other
provision of this Section 7, such distribution shall not be made until such
liquidation has taken place.
(c) So long as no Enforcement Notice is in effect, the Collateral
Agent shall distribute to the Administrative Agent, at its request from time to
time, the amounts on deposit in the Reduction Event Account which are required
to be
23
applied to prepay Loans in accordance with clause (B) of Section 2.06(a) of the
Credit Agreement.
(d) Promptly after the Collateral Agent determines that any cash
proceeds of any Lien Grantor's Collateral are to be realized upon any exercise
of remedies pursuant to the Collateral Documents, the Collateral Agent shall
establish an account with respect to such Lien Grantor (such Lien Grantor's
"Collateral Proceeds Account") with the Administrative Agent, in the name and
under the exclusive control of the Collateral Agent, into which all such cash
proceeds of such Lien Grantor's Collateral shall be deposited from time to time
(unless required to be deposited in another Collateral Account). This subsection
(d) shall not apply to any cash proceeds that are deposited in a Concentration
Account and are not required to be deposited in any Collateral Account.
(e) Amounts on deposit in any Collateral Account shall be invested and
re-invested from time to time in such Liquid Investments as the relevant Lien
Grantor shall determine. Any income received with respect to the balance from
time to time standing to the credit of any Collateral Account, including any
interest or capital gains on Liquid Investments, shall remain, or be deposited,
in such Collateral Account. All right, title and interest in and to the cash
amounts on deposit from time to time in any Collateral Account together with any
Liquid Investments from time to time made pursuant to this subsection (e) shall
vest in the Collateral Agent, shall constitute part of the relevant Lien
Grantor's Collateral hereunder and shall not constitute payment of its Secured
Obligations until applied thereto as provided in Section 15. If an Enforcement
Notice is in effect, any amounts held in any Collateral Account shall be
retained in such Collateral Account and, if and when requested by the
Administrative Agent, shall be withdrawn by the Collateral Agent and applied in
the manner specified in Section 15.
(f) For purposes hereof, "Liquid Investments" means any Temporary Cash
Investment that (i) matures within 30 days after it is acquired by or for the
account of the Collateral Agent and (ii) in order to provide the Collateral
Agent, for the benefit of the Secured Parties, with a perfected security
interest therein, either:
(i) is issued in the name of the Collateral Agent or a financial
intermediary acting for its account or is evidenced by a negotiable
certificate or instrument which (together with any appropriate
instrument of transfer) is delivered to, and held by, the Collateral
Agent or an agent thereof (which shall not be any Lien Grantor or any
of its Affiliates) in a State where possession thereof perfects the
Security Interest therein; or
24
(ii) if not so issued or evidenced, is a Temporary Cash
Investment which is subject to pledge under applicable law and
regulations and as to which (in the opinion of counsel to the
Collateral Agent) appropriate measures shall have been taken to perfect
the relevant Security Interest.
(g) The Collateral Agent shall, on a monthly basis, provide the Issuer
with or arrange for the Issuer to be provided with a statement of the balance
standing to the credit of the Reduction Event Account, which statement shall
indicate each payment into and from the Reduction Event Account during the
preceding calendar month.
SECTION 8. Record Ownership of Pledged Equity Securities. If directed
to do so by the Required Lenders at any time when an Event of Default has
occurred and is continuing, the Collateral Agent shall cause the Pledged Equity
Securities (or any portion thereof specified in such directions) to be
transferred of record into the name of the Collateral Agent or its nominee;
provided that no such transfer shall be made with respect to any capital stock
of any Insurance Subsidiary unless any required regulatory approvals under
applicable state law shall have been obtained. Promptly upon receiving any such
directions, the Collateral Agent will notify each relevant Lien Grantor thereof.
Each Lien Grantor will promptly give to the Collateral Agent copies of any
notices and other communications received by it with respect to Pledged Equity
Securities registered in its name, and the Collateral Agent will promptly give
to such Lien Grantor copies of any notices and other communications received by
the Collateral Agent with respect to such Lien Grantor's Pledged Equity
Securities registered in the name of the Collateral Agent or its nominee. So
long as no Enforcement Notice is in effect, the Collateral Agent shall pay over
to each relevant Lien Grantor all Cash Distributions received by the Collateral
Agent upon or with respect to any Pledged Equity Securities held of record in
the name of the Collateral Agent or its nominee.
SECTION 9. Right to Vote Pledged Equity Securities. (a) Unless an
Enforcement Notice directing the Collateral Agent to vote the Pledged Equity
Securities is in effect, each Lien Grantor shall have the right, from time to
time, to vote and to give consents, ratifications and waivers with respect to
the Pledged Equity Securities owned by it, and the Collateral Agent shall, upon
receiving a written request from such Lien Grantor, deliver to such Lien Grantor
or as specified in such request such proxies, powers of attorney, consents,
ratifications and waivers in respect of any of such Pledged Equity Securities
which are registered in the name of the Collateral Agent or its nominee as shall
be specified in such request and be in form and substance satisfactory to the
Collateral Agent. Unless an Enforcement Notice directing the Collateral Agent to
do so is in effect,
25
the Collateral Agent shall have no right to take any action which the owner of a
Pledged Partnership Interest or Pledged LLC Interest is entitled to take with
respect thereto, except the right to receive and retain payments and other
distributions to the extent provided in Section 10.
(b) If an Enforcement Notice directing the Collateral Agent to do so
is in effect, the Collateral Agent shall have the right to the extent permitted
by law (and, in the case of a Pledged Partnership Interest or Pledged LLC
Interest, by the relevant partnership agreement, operating agreement or other
governing document) and each Lien Grantor shall take all such action as may be
necessary or appropriate to give effect to such right, to vote and to give
consents, ratifications and waivers, and take any other action with respect to
any or all of the Pledged Equity Interests with the same force and effect as if
the Collateral Agent were the absolute and sole owner thereof; provided that the
Collateral Agent shall not have the right to vote or to give consents,
ratifications or waivers with respect to the capital stock of any Insurance
Subsidiary to the extent that such action would require prior regulatory
approval under applicable state law unless such approval shall have been
granted.
SECTION 10. Right to Receive Distributions on Collateral. Subject to
Section 18, the Collateral Agent shall have the right to receive and to retain
as Collateral hereunder all dividends, interest and other payments and
distributions made upon or with respect to the Pledged Equity Interests and each
Lien Grantor shall take all such action as the Collateral Agent may deem
necessary or appropriate to give effect to such right; provided that, unless an
Enforcement Notice is in effect, this sentence shall not apply to Cash
Distributions. All such dividends, interest and other payments and distributions
which are received by any Lien Grantor (except Cash Distributions received when
no Enforcement Notice is in effect) shall be received in trust for the benefit
of the Secured Parties and shall be segregated from other assets of such Lien
Grantor and shall, promptly upon such Lien Grantor's receipt thereof, be
delivered or paid over to the Collateral Agent in the same form as received
(with any necessary endorsements or executed assignments in blank), together
with a statement identifying the source of such Collateral and stating that it
is being delivered to the Collateral Agent to be held as Collateral under this
Agreement. If an Enforcement Notice is withdrawn pursuant to Section 21 (and no
other Enforcement Notice is then in effect), the Collateral Agent's right to
retain Cash Distributions under this Section 10 shall cease and the Collateral
Agent shall pay over to the relevant Lien Grantor(s) any Cash Distributions
retained by it during the continuance of such Enforcement Notice.
SECTION 11. General Authority. Each Lien Grantor hereby irrevocably
appoints the Collateral Agent its true and lawful attorney, with full power of
26
substitution, in the name of such Lien Grantor, any Secured Party or otherwise,
for the sole use and benefit of the Secured Parties, but at the expense of such
Lien Grantor, to the extent permitted by law to exercise, at any time and from
time to time while an Enforcement Notice directing it to do so is in effect, all
or any of the following powers with respect to all or any of such Lien Grantor's
Collateral:
(i) to demand, xxx for, collect, receive and give
acquittance for any and all monies due or to become due upon or
by virtue thereof,
(ii) to settle, compromise, compound, prosecute or
defend any action or proceeding with respect thereto,
(iii) to sell, transfer, assign or otherwise deal in or
with the same or the proceeds or avails thereof, as fully and
effectually as if the Collateral Agent were the absolute owner
thereof, and
(iv) to extend the time of payment of any or all
thereof and to make any allowance and other adjustments with reference
thereto;
provided that the Collateral Agent shall give such Lien Grantor not less than
ten days' prior written notice of the time and place of any sale or other
intended disposition of any Personal Property Collateral owned by such Lien
Grantor and such other notices as may be required by the Credit Agreement,
except in respect of any such Personal Property Collateral which threatens to
decline speedily in value or is of a type customarily sold on a recognized
market. The Collateral Agent and each Lien Grantor agree that such notice
constitutes "reasonable notification" within the meaning of Section 9-504(3) of
the UCC.
Section 12. Remedies upon Enforcement Notice. (a) Upon being instructed
to do so in an Enforcement Notice or in written instructions given by the
Required Lenders at any time while an Enforcement Notice is in effect, the
Collateral Agent may exercise (or cause its co-agents and co-trustees, if any,
to exercise) any or all of the remedies available to it (or to such co-agents or
co-trustees) under the Collateral Documents.
(b) Upon being instructed to do so in an Enforcement Notice or in
written instructions given by the Required Lenders at any time while an
Enforcement Notice is in effect, the Collateral Agent may exercise on behalf of
the Secured Parties all the rights of a secured party under the UCC (whether or
not in effect in the jurisdiction where such rights are exercised) with respect
to any Personal Property Collateral and, in addition, the Collateral Agent may,
without being required to give any notice, except as provided in the Credit
Agreement or herein or as may be required by mandatory provisions of law,
withdraw all cash
27
and Temporary Cash Investments held in any of the Collateral Accounts or
Concentration Accounts and apply such cash and Temporary Cash Investments and
other cash, if any, then held by it as Collateral as specified in Section 15
and, if there shall be no such cash or if such cash shall be insufficient to pay
all the Secured Obligations in full, sell the Collateral or any part thereof at
public or private sale or at any broker's board or on any securities exchange,
for cash, upon credit or for future delivery, and at such price or prices as the
Required Lenders shall have advised the Collateral Agent are satisfactory;
provided that the right of the Collateral Agent to sell or otherwise realize
upon the capital stock of any Insurance Subsidiary shall be subject to the
Collateral Agent's or the relevant Lien Grantor's obtaining, to the extent
necessary under applicable law, the prior approval of such sale or other
realization by the superintendent of insurance or other similar official having
jurisdiction with respect to such Insurance Subsidiary. Any Secured Party may be
the purchaser of any or all of the Collateral so sold at any public sale (or, if
the Collateral is of a type customarily sold in a recognized market or is of a
type which is the subject of widely distributed standard price quotations, at
any private sale). The Collateral Agent is authorized, in connection with any
such sale, if it deems it advisable so to do, to restrict the prospective
bidders on or purchasers of any of the securities included in the Collateral to
a limited number of sophisticated investors who will represent and agree that
they are purchasing for their own account for investment and not with a view to
the distribution or sale of any of such securities, to cause to be placed on any
security included in the Collateral a legend to the effect that such security
has not been registered under the Securities Act of 1933 and may not be disposed
of in violation of the provisions of said Act, and to impose such other
limitations or conditions in connection with any such sale as the Collateral
Agent deems necessary or advisable in order to comply with said Act or any other
law. Each Lien Grantor agrees that it will execute and deliver such documents
and take such other action as the Collateral Agent deems necessary or advisable
in order that any such sale may be made in compliance with law. Upon any such
sale the Collateral Agent shall have the right to deliver, assign and transfer
to the purchaser thereof the Collateral so sold. Each purchaser at any such sale
shall hold the Collateral so sold absolutely and free from any claim or right of
whatsoever kind, including any equity or right of redemption of any Lien Grantor
which may be waived, and each Lien Grantor, to the extent permitted by law,
hereby specifically waives all rights of redemption, stay or appraisal which it
has or may have under any law now existing or hereafter adopted. Notice of any
such sale shall be given to the relevant Lien Grantor(s) as required by Section
11 (including as required by the Credit Agreement) and shall in case of a public
sale, state the time and place fixed for such sale, in case of sale at a
broker's board or on a securities exchange, state the board or exchange at which
such sale is to be made and the day on which the Collateral, or the portion
thereof so being sold, will first be offered for sale at such board or exchange,
and in case of a private
28
sale, state the day after which such sale may be consummated. Any such public
sale shall be held at such time or times within ordinary business hours and at
such place or places as the Collateral Agent may fix in the notice of such sale.
At any such sale the Collateral may be sold in one lot as an entirety or in
separate parcels, as the Collateral Agent may determine. The Collateral Agent
shall not be obligated to make any such sale pursuant to any such notice. The
Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for the sale, and such sale may be made at any time
or place to which the same may be so adjourned. In case of any sale of all or
any part of the Collateral on credit or for future delivery, the Collateral so
sold may be retained by the Collateral Agent until the selling price is paid by
the purchaser thereof, but the Collateral Agent shall not incur any liability in
case of the failure of such purchaser to take up and pay for the Collateral so
sold and, in case of any such failure, such Collateral may again be sold upon
like notice. Upon being instructed to do so by the Required Lenders in an
Enforcement Notice or in written instructions given at any time while an
Enforcement Notice is in effect, the Collateral Agent, instead of exercising the
power of sale herein conferred upon it, may proceed by a suit or suits at law or
in equity to foreclose the Security Interests and sell the Collateral, or any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction. The foregoing provisions of this subsection shall apply to Real
Property Collateral only to the extent permitted by applicable law and the
provisions of any applicable Mortgage or other document.
(c) For the purpose of enforcing any and all rights and remedies under
this Agreement, the Collateral Agent may (i) require each Lien Grantor to, and
each Lien Grantor agrees that it will, at its expense and upon the request of
the Collateral Agent, forthwith assemble all or any part of its Personal
Property Collateral as directed by the Collateral Agent and make it available at
a place designated by the Collateral Agent which is, in its opinion, reasonably
convenient to the Collateral Agent and such Lien Grantor, whether at the
premises of such Lien Grantor or otherwise, (ii) to the extent permitted by
applicable law, enter, with or without process of law and without breach of the
peace, any premises where any of the Personal Property Collateral is or may be
located, and without charge or liability to it seize and remove such Personal
Property Collateral from such premises, (iii) have access to and use such Lien
Grantor's books and records relating to its Collateral and (iv) prior to the
disposition of its Personal Property Collateral, store or transfer it without
charge in or by means of any storage or transportation facility owned or leased
by such Lien Grantor, process, repair or recondition it or otherwise prepare it
for disposition in any manner and to the extent the Collateral Agent deems
appropriate and, in connection with such preparation and disposition, use
without charge any trademark, trade name, copyright, patent or technical process
used by such Lien Grantor. The Collateral
29
Agent may also render any or all of such Personal Property Collateral unusable
at such Lien Grantor's premises and may dispose of such Personal Property
Collateral on such premises without liability for rent or costs. The foregoing
provisions of this subsection shall apply to Real Property Collateral only to
the extent permitted by applicable law and the provisions of any applicable
Mortgage or other document.
(d) Without limiting the generality of the foregoing, if an Enforcement
Notice is in effect,
(i) the Collateral Agent may, upon proper notice as provided
in Section 11 hereof, license, or sublicense, whether general, special
or otherwise, and whether on an exclusive or non-exclusive basis, any
Intellectual Property included in the Collateral throughout the world
for such term or terms, on such conditions and in such manner as the
Collateral Agent shall in its sole discretion determine; provided that
such licenses do not conflict with any existing licenses;
(ii) the Collateral Agent may, upon proper notice as provided
in Section 11 hereof (without assuming any obligations or liability
thereunder), at any time and from time to time, in its sole and
reasonable discretion, enforce (and shall have the exclusive right to
enforce) against any licensee or sublicensee all rights and remedies of
any Lien Grantor in, to and under any of its Intellectual Property and
take or refrain from taking any action under any thereof, and each Lien
Grantor hereby releases the Collateral Agent and each of the other
Secured Parties from, and agrees to hold the Collateral Agent and each
of the other Secured Parties free and harmless from and against any
claims and expenses arising out of, any lawful action so taken or
omitted to be taken with respect thereto, except for claims and
expenses arising from the Collateral Agent's or such Secured Party's
gross negligence or willful misconduct; and
(iii) upon request by the Collateral Agent (which shall not
be construed as implying any limitation on the rights or powers of the
Collateral Agent), each Lien Grantor will execute and deliver to the
Collateral Agent a power of attorney, in form and substance
satisfactory to the Collateral Agent, for the implementation of any
lease, assignment, license, sublicense, grant of option, sale or other
disposition of any Intellectual Property owned by such Lien Grantor or
any action related thereto. In the event of any such disposition
pursuant to this Section, subject to confidentiality restrictions
imposed on such Lien Grantor in any license or similar agreement, such
Lien Grantor shall supply its know-how and expertise relating to or the
products or services made or rendered in
30
connection with Patents, and its customer lists and other records
relating to such Intellectual Property and to the distribution of said
products or services, to the Collateral Agent.
Section 13. Fees and Expenses; Indemnification. The Issuer agrees that
it will forthwith upon demand pay to the Collateral Agent:
(i) the amount of any taxes which the Collateral Agent may
have been required to pay by reason of the Security Interests or to
free any of the Collateral from any Lien thereon;
(ii) the amount of any and all reasonable out-of-pocket
expenses, including transfer taxes and reasonable fees and
disbursements of counsel and of any other experts, which the Collateral
Agent may incur in connection with (w) the administration or
enforcement of this Agreement, including such expenses as are incurred
to preserve the value of the Collateral and the validity, perfection,
rank and value of any Security Interest, and all insurance expenses and
all expenses of protecting, storing, warehousing, appraising, insuring,
handling, maintaining and shipping any Collateral, (x) the collection,
sale or other disposition of any Collateral, (y) the exercise by the
Collateral Agent of any of the rights or powers conferred upon it
hereunder or (z) any Enforcement Notice;
(iii) the amount of any fees that the Issuer shall have agreed
in writing to pay to the Collateral Agent and that shall have become
due and payable in accordance with such written agreement; and
(iv) the amount required to indemnify the Collateral Agent for,
or hold it harmless and defend it against, any loss, liability or
expense (including the reasonable fees and expenses of its counsel and
any experts or co-agents appointed hereunder) incurred or suffered by
the Collateral Agent in connection with this Agreement, except to the
extent that such loss, liability or expense arises from the Collateral
Agent's gross negligence or willful misconduct or a breach of any duty
that the Collateral Agent has under this Agreement (after giving effect
to Sections 14 and 16).
Any such amount not paid to the Collateral Agent on demand shall bear interest
for each day until paid at the rate per annum set forth in Section 2.02(b) of
the Credit Agreement.
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Section 14. Limitation on Duty of Collateral Agent in Respect of
Collateral. Beyond the exercise of reasonable care in the custody and
preservation thereof, the Collateral Agent shall have no duty as to any Personal
Property Collateral in its possession or control or in the possession or control
of any agent or bailee or any income thereon or as to the preservation of rights
against prior parties or any other rights pertaining thereto. The Collateral
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of the Personal Property Collateral in its possession if such
Personal Property Collateral is accorded treatment substantially equal to that
which it accords its own property, and shall not be liable or responsible for
any loss or damage to any of the Personal Property Collateral, or for any
diminution in the value thereof, by reason of any act or omission of any agent
or bailee selected by the Collateral Agent in good faith or by reason of any act
or omission by the Collateral Agent pursuant to instructions from the Required
Lenders (including, without limitation, any voting instruction pursuant to
Section 9), except to the extent that such liability arises from the Collateral
Agent's gross negligence or willful misconduct.
Section 15. Application of Proceeds. (a) So long as the Intercreditor
Agreement is in effect, following a Triggering Event (as defined therein), the
Collateral Agent shall apply (i) the proceeds of any sale of, or other
realization upon, all or any part of the Collateral, (ii) any cash held in the
Reduction Event Accounts and the Collateral Proceeds Accounts and (iii) any cash
withdrawn by it from the Concentration Accounts as set forth in the
Intercreditor Agreement.
(b) At all times when the Intercreditor Agreement is not in effect,
upon being instructed to do so in an Enforcement Notice or in written
instructions given by the Required Lenders at any time while an Enforcement
Notice is in effect, the Collateral Agent shall apply (i) the proceeds of any
sale of, or other realization upon, all or any part of the Collateral, (ii) any
cash held in the Reduction Event Accounts and the Collateral Proceeds Accounts
and (iii) any cash withdrawn by it from the Concentration Accounts in the
following order of priorities:
first, to pay the expenses of such sale or other realization,
including reasonable compensation to agents of and counsel for the
Collateral Agent, and all expenses, liabilities and advances incurred
or made by the Collateral Agent in connection with the Collateral
Documents, and any other amounts then due and payable to the Collateral
Agent pursuant to Section 13 hereof and to the other Agents pursuant to
Section 12.03 of the Credit Agreement;
second, to pay the unpaid principal of the Secured Obligations
ratably, until payment in full of the principal of all Secured
Obligations shall have been made;
32
third, to pay all interest (including Post-Petition Interest)
on the Secured Obligations and all fees payable under the Credit
Agreement ratably, until payment in full of all such interest and fees
shall have been made;
fourth, to pay all other Secured Obligations ratably, until
payment in full of all such other Secured Obligations shall have been
made; and
finally, to pay to the relevant Lien Grantor or its successors
or assigns, or as a court of competent jurisdiction may direct, any
surplus then remaining from the proceeds of the Collateral owned by it;
provided that Collateral owned by a Guarantor and any proceeds thereof shall be
applied pursuant to the foregoing clauses first, second, third and fourth only
to the extent that the Secured Obligations referred to therein are guaranteed by
such Guarantor (and, in the case of a Subsidiary Guarantor, subject to the
limitation in Section 10 of its Subsidiary Guaranty Agreement). The Collateral
Agent may make such distributions hereunder in cash or in kind or, on a ratable
basis, in any combination thereof.
(c) In making the payments and allocations required by this Section,
the Collateral Agent may rely upon information supplied to it pursuant to
Section 16(f). All distributions made by the Collateral Agent pursuant to this
Section shall be final (except in the event of manifest error) and the
Collateral Agent shall have no duty to inquire as to the application by the
Secured Parties of any amount distributed to them.
SECTION 16. Concerning the Collateral Agent. (a) The Collateral Agent
is authorized to take all such action as is provided or permitted to be taken by
it as Collateral Agent under the Collateral Documents and all other action
reasonably incidental thereto. As to any matters not expressly provided for
herein or in an Enforcement Notice or in written requests, directions or
instructions given as expressly provided in Section 6, 7, 9, 12 or 15,
including, without limitation, the timing and methods of realization upon the
Collateral, the Collateral Agent shall act or refrain from acting in accordance
with written instructions from the Required Lenders or, in the absence of such
instructions, in accordance with its discretion (subject to Section 16(c));
provided that the Collateral Agent shall not be obligated to comply with any
such instructions that are inconsistent with the provisions of the Collateral
Documents.
(b) The Collateral Agent shall not be responsible for the existence,
genuineness or value of any Collateral or for the validity, perfection, priority
or enforceability of the Security Interests in any Collateral, whether impaired
by
33
operation of law or by reason of any action or omission to act on its part under
the Collateral Documents. The Collateral Agent shall have no duty to ascertain
or inquire as to the performance or observance of any of the terms of this
Agreement, the Credit Agreement or any other agreement relating to the Secured
Obligations.
(c) The obligations of the Collateral Agent under the Collateral
Documents are only those expressly set forth therein. In any case in which the
Collateral Agent is authorized to exercise any power or discretion, the
Collateral Agent may refrain from such exercise unless directed in writing by
the Required Lenders to act in the manner specified in such direction. Without
limiting the generality of the foregoing, the Collateral Agent shall not be
required to take any action with respect to any Enforcement Notice, except as
expressly provided in Sections 12 and 15.
(d) The Collateral Agent may:
(i) consult with legal counsel (who may be counsel for the
Issuer or any Guarantor) and
(ii) to the extent that the Collateral Agent in good xxxxx
xxxxx it appropriate in connection with its duties hereunder to do so,
consult with independent public accountants and other experts selected
by it in connection with any matter arising under the Collateral
Documents and shall not be liable for any action taken or omitted to be
taken by it in good faith in accordance with the advice of such
counsel, accountants or experts.
(e) Neither the Collateral Agent nor any of its directors, officers,
agents, or employees shall be liable for any action taken or not taken by it in
connection with any Collateral Document (i) in accordance with directions set
forth in an Enforcement Notice or (ii) with the consent or at the request of the
Required Lenders or (iii) in the absence of its own gross negligence or willful
misconduct. However, nothing in this subsection (e) shall affect any rights any
Lien Grantor may have (x) against the Lenders for requesting the Administrative
Agent to give the directions set forth in an Enforcement Notice or (y) against
the Required Lenders for giving any other consent, request, notice or
instruction. Neither the Collateral Agent nor any of its directors, officers,
agents or employees shall be responsible for or have any duty to ascertain,
inquire into or verify (i) any statement, warranty or representation made in
connection with any Collateral Document, (ii) the performance or observance of
any of the covenants or agreements of any Lien Grantor or (iii) the validity,
effectiveness or genuineness of any Collateral Document or any other instrument
or writing furnished in connection therewith. The Collateral Agent shall not
incur any liability by acting
34
in reliance upon any notice, consent, certificate, statement or other writing
(which may be a bank wire, telex, facsimile or similar writing) believed by it
to be genuine or to be signed by the proper party or parties.
(f) For all purposes of the Collateral Documents, including without
limitation determining from time to time the amounts of the Secured Obligations
or whether any notice, direction or instruction has been given by the Required
Lenders or any other Secured Party or Secured Parties entitled to give the same
under any provision of the Collateral Documents, the Collateral Agent shall be
entitled to rely upon information from the following sources (and may refrain
from acting on the basis of such information until two Business Days after it
receives all such information required to enable it to take such action):
(i) the Administrative Agent for information as to the Lender
Parties and their respective Secured Obligations outstanding under the
Credit Agreement (including whether any action has been taken or
instruction given by the Required Lenders);
(ii) any Secured Party for information as to itself and its
Secured Obligations, to the extent that the Collateral Agent has not
received such information from the Administrative Agent; and
(iii) any Lien Grantor for information as to any Secured Party
and its Secured Obligations, to the extent that the Collateral Agent
has not received such information from the sources referred to in
clauses (i) and (ii) above.
(g) The Collateral Agent shall have no liability to any Lien Grantor
or any Secured Party for actions taken in reliance on such information, except
to the extent that such liability arises from the Collateral Agent's gross
negligence or willful misconduct.
(h) (i) The Collateral Agent may resign at any time (effective upon
acceptance by a successor Collateral Agent of its appointment hereunder) by
giving written notice thereof to the Administrative Agent, each of the Secured
Parties Requesting Notice and the Issuer. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Collateral Agent.
If no successor Collateral Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 30 days after the
retiring Collateral Agent gives notice of resignation, the retiring Collateral
Agent may, on behalf of the Secured Parties, appoint a successor Collateral
Agent, which shall be a commercial bank organized or licensed under the laws of
the United States or of any State thereof and having a combined capital and
surplus of at least
35
$100,000,000. Upon the acceptance of its appointment as Collateral Agent
hereunder by a successor Collateral Agent, such successor Collateral Agent shall
thereupon succeed to and become vested with all the rights and duties of the
retiring Collateral Agent, and the retiring Collateral Agent shall be discharged
from its duties and obligations hereunder. After any retiring Collateral Agent's
resignation hereunder as Collateral Agent, the provisions of this Section and
Sections 13 and 14 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was the Collateral Agent.
(ii) Without prejudice to its rights under paragraph (i),
Xxxxxx may resign as Collateral Agent at any time and may appoint any
other subsidiary of X.X. Xxxxxx Chase & Co. to such role by giving
written notice thereof to each of the Secured Parties Requesting Notice
and the Issuer. Upon such appointment, such subsidiary shall thereupon
succeed to and become vested with all the rights and duties of the
Collateral Agent and Xxxxxx shall be discharged from its duties and
obligations in such capacity hereunder. After Xxxxxx resigns as
Collateral Agent under this paragraph (ii), the provisions of this
Section and Sections 13 and 14 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Collateral
Agent.
(i) Within two Business Days after it receives or sends any notice
referred to in this subsection (i), the Collateral Agent shall send to the
Administrative Agent and each of the Secured Parties Requesting Notice, copies
of any Enforcement Notice received by the Collateral Agent, any notice
withdrawing an Enforcement Notice received by the Collateral Agent pursuant to
Section 21 and any other notice given by the Collateral Agent to any Lien
Grantor, or received by it from any Lien Grantor, pursuant to Section 11, 12, 15
or 18. The Collateral Agent shall also send to the Lien Grantors copies of any
Enforcement Notice or any notice withdrawing an Enforcement Notice received by
the Collateral Agent.
(j) The Collateral Agent may refuse to act on any notice, direction or
instruction from the Administrative Agent, the Required Lenders, or any Secured
Party, or any agent, trustee or similar representative thereof which, in the
Collateral Agent's opinion, is contrary to law or the provisions of any
Collateral Document, is unduly prejudicial to Secured Parties not joining in
such notice, direction or instruction or may expose the Collateral Agent to
liability (unless the Collateral Agent shall have been adequately indemnified
for such liability by the Secured Parties that gave, or instructed the
Administrative Agent to give, such notice, direction or instruction).
36
Section 17. Appointment of Co-collateral Agents. At any time or times,
in order to comply with any legal requirement in any jurisdiction, the
Collateral Agent may appoint another bank or trust company or one or more other
persons, either to act as co-agent or co-agents, jointly with the Collateral
Agent, or to act as separate agent or agents on behalf of the Secured Parties
with such power and authority as may be necessary for the effectual operation of
the provisions of any Collateral Document and may be specified in the instrument
of appointment (which may, in the discretion of the Collateral Agent, include
provisions for the protection of such co-agent or separate agent similar to the
provisions of Section 16).
Section 18. Termination of Security Interests; Release of Collateral;
Reinstatement. (a) When all outstanding Secured Obligations shall have been
indefeasibly paid in full, the Security Interests shall terminate and all rights
to each item of Collateral shall revert to the Lien Grantor that owns such item
of Collateral.
(b) At any time before the Security Interests terminate pursuant to
subsection (a) of this Section, so long as an Enforcement Notice is not in
effect, the Collateral Agent shall, upon the written request of the Issuer,
release any of the Collateral (but not all or substantially all of the
Collateral) with the prior written consent of the Required Lenders.
(c) At any time before the Security Interests terminate pursuant to
subsection (a) of this Section, unless an Enforcement Notice is in effect, (i)
the Collateral Agent shall release Collateral (but not all or substantially all
the Collateral) upon receiving from the Administrative Agent written
instructions (A) directing the Collateral Agent to release such Collateral, (B)
stating that the Issuer has requested such release pursuant to Section 2.10 of
the Credit Agreement and (C) stating that the Administrative Agent believes that
the Issuer is entitled to such release pursuant to said Section 2.10 and (ii)
the Security Interests in any assets sold or exchanged (but not in any Proceeds
arising from such sale or exchange) by any Lien Grantor (other than a sale or
exchange to another Lien Grantor) in any transaction permitted by the proviso in
Section 5(j) shall cease concurrently with such sale or exchange. No such
release shall require the consent of any Secured Party and, in the case of any
release pursuant to clause (i), the Collateral Agent shall be fully protected in
relying on such instructions from the Administrative Agent.
(d) The Security Interests in any property abandoned by any Lien Grantor
to Ventas pursuant to Section 6.2 of any Master Lease Agreement to which the
Issuer and Vencor is a party shall be automatically terminated without any
necessity to deliver any termination statements or releases. Notwithstanding
37
the foregoing, at the request of Ventas, certifying that such an abandonment has
occurred, the Collateral Agent, shall execute and deliver to Ventas, at the
expense of Ventas, such documents as are necessary in order to evidence such
termination of Security Interests.
(e) Upon any such termination of the Security Interests or release of
Collateral pursuant to the foregoing clauses (other than clause (d)), the
Collateral Agent will, at the expense of the relevant Lien Grantor, execute and
deliver to such Lien Grantor such documents as such Lien Grantor shall
reasonably request to evidence the termination of the Security Interests or the
release of such Collateral, as the case may be.
(f) Notwithstanding Section 18(a), this Agreement shall remain in full
force and effect and continue to be effective should any petition be filed by or
against any Lien Grantor for liquidation or reorganization, should any Lien
Grantor become insolvent or make an assignment for the benefit of any creditor
or creditors or should a receiver or trustee be appointed for all or any
significant part of any Lien Grantor's assets, and shall continue to be
effective or be reinstated, as the case may be, if at any time payment and
performance of the Secured Obligations, or any part thereof, is, pursuant to
applicable law, rescinded or reduced in amount, or must otherwise be restored or
returned by any obligee of the Secured Obligations, whether as a "voidable
preference", "fraudulent conveyance", or otherwise, all as though such payment
or performance had not been made. In the event that any payment, or any part
thereof, is rescinded, reduced, restored, or returned, the Secured Obligations
shall be reinstated and deemed reduced only by such amount paid and not so
rescinded, reduced, restored or returned.
Section 19. Additional Subsidiary Guarantors. Any Subsidiary of the Issuer
which is not a party hereto may become a party hereto by executing and
delivering to the Collateral Agent a Security Agreement Supplement, whereupon
such Subsidiary shall become a "Subsidiary Guarantor", a "Lien Grantor" and a
party hereto.
Section 20. Notices. All notices, requests and other communications to any
party hereunder shall be in writing (including facsimile transmission or similar
writing) and shall be given to such party:
(i) in the case of any Lien Grantor listed on the signature
pages hereof, to it at:
Vencor Operating, Inc.
(to be renamed Kindred Healthcare Operating, Inc.)
38
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: General Counsel
Facsimile: (000) 000-0000
with copies to:
Vencor Operating, Inc.
(to be renamed Kindred Healthcare Operating, Inc.)
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Assistant Treasurer
Facsimile: (000) 000-0000
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxxx, Esq.
Xxxxxxx Xxxxxxxxx, Esq.
(ii) in the case of any other Lien Grantor, to it at its address or
facsimile number set forth in its Security Agreement Supplement;
(iii) in the case of the Collateral Agent, to it at:
Xxxxxx Guaranty Trust Company of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Houston Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
X.X. Xxxxxx Services
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx and Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
39
(iv) in the case of any Lender Party, to the Administrative Agent to
be forwarded to such Lender Party at its address or facsimile number
specified in or pursuant to Section 12.01 of the Credit Agreement;
(v) in the case of any Secured Party Requesting Notice, to it at
such address or facsimile number as such party may hereafter specify for
the purpose by notice to the Collateral Agent; or
(vi) in the case of any party, to it at such other address or
facsimile number as such party may hereafter specify for the purpose by
notice to the Collateral Agent and the Lien Grantors.
Each such notice, request or other communication shall be effective (x) if given
by facsimile transmission, when transmitted to the facsimile number referred to
in this Section and confirmation of receipt is received, (y) if given by mail,
ten days after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (z) if given by any other means, when
delivered at the address referred to in this Section. NOTICE TO THE ISSUER UNDER
THIS AGREEMENT OR UNDER ANY OTHER FINANCING DOCUMENT SHALL CONSTITUTE NOTICE TO
ALL LIEN GRANTORS FOR ALL PURPOSES HEREUNDER AND THEREUNDER, AND NOTICE FROM THE
ISSUER UNDER THIS AGREEMENT OR UNDER ANY OTHER FINANCING DOCUMENT PURPORTING TO
BE NOTICE FROM ALL LIEN GRANTORS SHALL CONSTITUTE NOTICE FROM ALL LIEN GRANTORS
FOR ALL PURPOSES HEREUNDER AND THEREUNDER. Each Lien Grantor other than the
Issuer hereby irrevocably appoints the Issuer as such Lien Grantor's agent and
attorney-in-fact, with full authority in the place and stead of such Lien
Grantor and in the name of such Lien Grantor, the Issuer or otherwise, from time
to time in the Issuer's discretion, to execute and deliver (and receive, where
applicable) any and all written notices and communications hereunder on behalf
of the Lien Grantors to the Agents and the Lenders, and to deliver unwritten
notices and communications to the foregoing effect, and each Lender Party shall
be entitled to rely upon any such notice or communication as a notice,
communication or consent, as the case may be, of the Lien Grantors, and shall
incur no liability to the Issuer or any other Lien Grantor in acting upon any
such notice or communication that such Lender Party believes in good faith to
have been given by a duly authorized officer or other person authorized by the
Issuer.
Section 21. Withdrawal of Enforcement Notice. An Enforcement Notice,
once given, shall remain in effect unless and until (i) the Required Lenders
notify the Collateral Agent that they wish to withdraw such Enforcement Notice,
(ii) no monies have been applied to pay any Secured Obligations pursuant to
Section 15
40
(except pursuant to clause first of subsection (b) thereof) as a result of such
Enforcement Notice and (iii) the Collateral Agent determines that the withdrawal
of such Enforcement Notice will not result in any liability or unreimbursed loss
to the Collateral Agent by reason of actions taken by it in reliance thereon.
Section 22. Waivers, Remedies Not Exclusive. No failure on the part of the
Collateral Agent to exercise, and no delay in exercising and no course of
dealing with respect to, any right or remedy under any Collateral Document shall
operate as a waiver thereof; nor shall any single or partial exercise by the
Collateral Agent of any right or remedy under the Credit Agreement or any
Collateral Agreement preclude any other or further exercise thereof or the
exercise of any other right or remedy. The rights and remedies specified in the
Collateral Documents and the Credit Agreement are cumulative and are not
exclusive of any other rights or remedies provided by law.
Section 23. Successors and Assigns. This Agreement is for the benefit of
the Collateral Agent and the Secured Parties and their respective successors and
assigns, and in the event of an assignment of all or any of the Secured
Obligations, the rights of the holder thereof hereunder, to the extent
applicable to the indebtedness so assigned, shall be transferred with such
indebtedness. This Agreement shall be binding on the Lien Grantors and their
respective successors and assigns.
Section 24. Changes in Writing. Neither this Agreement nor any provision
hereof may be amended, waived, discharged or terminated except in accordance
with Section 12.05 of the Credit Agreement.
Section 25. NEW YORK LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT AS OTHERWISE REQUIRED BY
MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT REMEDIES PROVIDED BY
THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK ARE GOVERNED BY
THE LAWS OF SUCH JURISDICTION.
41
Section 26. Severability. If any provision of any Collateral Document is
invalid or unenforceable in any jurisdiction, then, to the fullest extent
permitted by law, the other provisions of the Collateral Documents shall remain
in full force and effect in such jurisdiction and shall be liberally construed
in favor of the Collateral Agent and the Secured Parties in order to carry out
the intentions of the parties thereto as nearly as may be possible; and the
invalidity or unenforceability of any provision thereof in any jurisdiction
shall not affect the validity or enforceability of such provision in any other
jurisdiction.
Section 27. Intercreditor Agreement. Notwithstanding any provision to the
contrary contained herein, the terms of this Agreement, the Liens created
hereby, and the rights and remedies of the Collateral Agent and the Secured
Parties hereunder, are subject to the Intercreditor Agreement and subordinated
as provided therein. Wherever in this Agreement references to the rights and
obligations of the Collateral Agent are, in furtherance of the foregoing
sentence, qualified by references to the Intercreditor Agreement or the Senior
Financing Documents, such references are intended solely for purposes of
acknowledging the provisions that the Collateral Agent, as between it and the
Senior Collateral Agent, has agreed to accept at the direction of the Secured
Parties, and no such references are intended or shall be applied to create or
impose, as between the Collateral Agent, on the one hand, and the Lien Grantors
on the other hand, any limitation on the rights of the Collateral Agent or the
obligations of the Lien Grantors; provided that if and for so long as the Issuer
and the other Lien Grantors are subject to and complying with any requirements
similar to those in this Agreement imposed by the Senior Collateral Documents,
the Issuer and the other Lien Grantors need not comply with the requirements of
this Agreement (and the provisions of this Agreement shall be applied
accordingly).
Section 28. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same instrument.
42
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
VENCOR OPERATING, INC.
(to be renamed Kindred Healthcare
Operating, Inc.)
By: ____________________________________
Name:
Title:
VENCOR, INC.
(to be renamed Kindred Healthcare, Inc.)
By: ____________________________________
Name:
Title:
XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK,
as Collateral Agent
By: ____________________________________
Name:
Title:
SUBSIDIARY GUARANTORS
---------------------
[_____________________]
EXHIBIT A
to Second Priority Security Agreement
SECOND PRIORITY SECURITY AGREEMENT SUPPLEMENT
SECOND PRIORITY SECURITY AGREEMENT SUPPLEMENT (the "Security Agreement
Supplement") dated as of _______, ____, between [name of Subsidiary Guarantor]
(the "Subsidiary Guarantor") and [Xxxxxx Guaranty Trust Company of New York], as
Collateral Agent.
WHEREAS, Vencor Operating, Inc. (to be renamed Kindred Healthcare
Operating, Inc.), the Guarantors party thereto and Xxxxxx Guaranty Trust Company
of New York, as Collateral Agent, are parties to a Second Priority Security
Agreement dated as of April 20, 2001 (as heretofore amended and/or supplemented,
the "Security Agreement");
WHEREAS, terms defined in the Security Agreement (or whose definitions are
incorporated by reference in Section 1 of the Security Agreement) and not
otherwise defined herein have, as used herein, the respective meanings provided
for therein; and
WHEREAS, [name of Subsidiary Guarantor] desires to become a party to the
Security Agreement as an additional Lien Grantor thereunder;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Grant of Security Interest. In order to secure the full and
punctual payment of the Secured Obligations in accordance with the terms
thereof, the Subsidiary Guarantor grants to the Collateral Agent for the benefit
of the Secured Parties a continuing security interest in all of the following
assets of the Subsidiary Guarantor (the "New Collateral"):
[describe assets being added to the Collateral]
2. Delivery of Collateral. Concurrently with delivering this Security
Agreement Supplement to the Collateral Agent, the Subsidiary Guarantor is
complying with the provisions of Section 4 of the Security Agreement with
respect to all stock certificates and other certificates representing Equity
Interests (if any) included in the New Collateral and all Instruments (if any)
included in the New Collateral.
A-1
3. Party to Security Agreement. Upon delivery of this Security Agreement
Supplement to the Collateral Agent, the Subsidiary Guarantor will become a party
to the Security Agreement and will thereafter have all of the rights and
obligations of a Subsidiary Guarantor thereunder and be bound by all of the
provisions thereof as fully as if the Subsidiary Guarantor were one of the
original parties thereto.
4. Address of Subsidiary Guarantor. The address and facsimile number of
the Subsidiary Guarantor to which all notices, requests and other communications
shall be sent pursuant to Section 20 of the Security Agreement is:
[address and facsimile number of Subsidiary Guarantor]
5. Representations and Warranties./1/ (a) The Subsidiary Guarantor is a
corporation duly incorporated, validly existing and in good standing under the
laws of [jurisdiction of incorporation].
(b) The Subsidiary Guarantor has delivered a Perfection Certificate to
the Collateral Agent. The information set forth therein is correct and complete
as of the date hereof. Within 60 days of the date hereof, the Subsidiary
Guarantor shall furnish to the Collateral Agent file search reports from each
UCC filing office confirming the filing information set forth in such Perfection
Certificate.
(c) The execution and delivery of this Security Agreement Supplement by
the Subsidiary Guarantor and the performance by it of its obligations under the
Security Agreement as supplemented hereby are within its corporate or other
powers, have been duly authorized by all necessary corporate or other action,
require no action by or in respect of, or filing with, any governmental body,
agency or official and do not contravene, or constitute a default under, any
provision of applicable law or regulation or of its Organizational Documents, or
of any agreement, judgment, injunction, order, decree or other instrument
binding upon it or result in the creation or imposition of any Lien (other than
the Liens created by the Collateral Documents and the Senior Collateral
Documents) on any of its assets.
(d) The Security Agreement as supplemented hereby constitutes a valid and
binding agreement of the Subsidiary Guarantor, enforceable in accordance with
its terms, except as may be limited by (i) bankruptcy, insolvency, fraudulent
conveyance or other similar laws affecting creditors' rights generally and (ii)
general principles of equity.
__________________
/1/ Modify as needed for any Subsidiary Guarantor that is not a corporation.
A-2
(e) As of the date hereof, the Subsidiary Guarantor owns the Equity
Interests listed as being owned by it in Schedule 1 to this Security Agreement
Supplement, free and clear of any Lien other than Permitted Liens. All shares of
capital stock identified in such Schedule as being beneficially owned by the
Subsidiary Guarantor have been duly authorized and validly issued, are fully
paid and non-assessable, and are subject to no option to purchase or similar
right of any Person. The Subsidiary Guarantor is not and will not become a party
to or become otherwise bound by any agreement, other than the Financing
Documents and the Senior Financing Documents, which restricts in any manner the
rights of any present or future holder of any Pledged Equity Interest with
respect thereto.
(f) The Subsidiary Guarantor has good and marketable title to all of
its Collateral (except Intellectual Property), free and clear of any Lien other
than Permitted Liens. To the best of its knowledge, the Subsidiary Guarantor has
good title or other rights in and to all Intellectual Property owned by or
licensed to it on the date hereof, free and clear of any Lien other than
Permitted Liens. The Subsidiary Guarantor has taken all actions necessary under
the UCC to perfect its interest in any Accounts purchased or otherwise acquired
by it, as against its assignors and creditors of its assignors.
(g) Other than granting Permitted Liens, the Subsidiary Guarantor has
not performed any acts that might prevent the Collateral Agent from enforcing
any of the provisions of the Collateral Documents or that would limit the
Collateral Agent in any such enforcement. No financing statement, security
agreement, mortgage or similar or equivalent document or instrument covering all
or any part of the Collateral owned by it is on file or of record in any
jurisdiction in which such filing or recording would be effective to perfect or
record a Lien on such Collateral, except financing statements, mortgages or
other similar or equivalent documents with respect to Permitted Liens. After the
date hereof, no Collateral owned by it will be in the possession of any Person
(other than the Subsidiary Guarantor) asserting any claim thereto or security
interest therein (except Permitted Liens), except that (i) the Senior Collateral
Agent or its designee may have possession of Collateral as contemplated by the
Senior Collateral Agreement and the Intercreditor Agreement or the Collateral
Agent or its designee may have possession of Collateral as contemplated hereby
and (ii) cash and Temporary Cash Investments may be held in the Concentration
Accounts.
(h) The Personal Property Security Interests constitute valid security
interests in all Personal Property Collateral owned by the Subsidiary Guarantor
thereby securing its Secured Obligations, and constitute security interests
therein prior to all other Liens other than Liens permitted under the Credit
Agreement to be senior in priority to the Liens of the Lenders.
A-3
(i) Upon the delivery of the Pledged Instruments (if any) and the Pledged
Equity Securities owned by the Subsidiary Guarantor to the Collateral Agent in
accordance with Section 4 of the Security Agreement, the Collateral Agent will
have valid and perfected security interests in such Collateral subject to no
prior Lien other than Permitted Liens.
(j) When UCC financing statements shall have been filed in the
appropriate offices, the Personal Property Security Interests will constitute
perfected security interests in the Personal Property Collateral owned by the
Subsidiary Guarantor to the extent that a security interest therein may be
perfected by filing pursuant to the UCC, prior (except in the case of
Intellectual Property) to all Liens and rights of others therein except
Permitted Liens. When, in addition to the filing of such UCC financing
statements, the applicable Intellectual Property Filings have been made with
respect to the Subsidiary Guarantor's Intellectual Properties (including any
future filings required pursuant to Sections 5(c) and 5(d) of the Security
Agreement), the Personal Property Security Interests will constitute perfected
security interests in all right, title and interest of the Subsidiary Guarantor
in its Intellectual Property to the extent that security interests therein may
be perfected by such filings and, to the best of the Subsidiary Guarantor's
knowledge, such security interests will be prior to all other Liens and rights
of others therein except Permitted Liens. Except for (i) the filing of such UCC
financing statements, (ii) such Intellectual Property Filings, (iii) the due
recordation of memoranda of lease with respect to any Real Property Collateral
leased or subleased to the Subsidiary Guarantor and any assignments of any such
lease or sublease and (iv) the due recordation of the Fee Mortgages and the
Leasehold Mortgages, no registration, recordation or filing with any
governmental body, agency or official is required in connection with the
execution or delivery of the Collateral Documents or is necessary for the
validity or enforceability thereof or for the perfection or due recordation of
the Security Interests or (except with respect to the capital stock of any
Insurance Subsidiary)) for the enforcement of the Security Interests.
(k) The Subsidiary Guarantor's Collateral is insured in accordance with
the requirements of the Credit Agreement.
6. Governing Law. This Security Agreement Supplement shall be construed
in accordance with and governed by the laws of the State of New York.
7. Intercreditor Agreement. Section 27 of the Security Agreement is
hereby incorporated herein by reference.
A-4
IN WITNESS WHEREOF, the parties hereto have cause this Security
Agreement Supplement to be duly executed by their respective authorized officers
as of the day and year first above written.
[Name of Subsidiary Guarantor]
By:_________________________
Name:
Title:
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Collateral Agent
By:___________________________
Name:
Title:
A-5
SCHEDULE 1
to Second Priority Security Agreement
Supplement
EQUITY INTERESTS OWNED BY
SUBSIDIARY GUARANTOR
Number of
State of Percentage Shares or Units
Name Organization Owned (if certificated)
---------- -------------- ------------------ -------------------------
1
EXHIBIT B
to Second Priority Security Agreement
SECOND PRIORITY COPYRIGHT SECURITY AGREEMENT
(Copyrights, Copyright Registrations, Copyright
Applications and Copyright Licenses)
WHEREAS, [Name of Lien Grantor], a _____________ corporation/1/ (herein
referred to as the "Lien Grantor") owns, or in the case of licenses, is a party
to, the Copyright Collateral (as defined below);
WHEREAS, Vencor Operating, Inc. (to be renamed Kindred Healthcare
Operating, Inc.), Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), the
Lenders referred to therein and Xxxxxx Guaranty Trust Company of New York, as
Administrative Agent and Collateral Agent, are parties to a Credit Agreement
dated as of April 20, 2001 (as amended from time to time, the "Credit
Agreement");
[WHEREAS, pursuant to the terms of a Second Priority Subsidiary
Guaranty Agreement dated as of __________, ____, the Lien Grantor has
guaranteed, subject to certain limitations, certain obligations of Vencor
Operating, Inc. (such guarantee being herein referred to as the Lien Grantor's
"Guaranty"); and]
[WHEREAS, pursuant to the terms of the Second Priority Vencor Guaranty
Agreement dated as of April 20, 2001, the Lien Grantor has guaranteed certain
obligations of Vencor Operating, Inc. (such guarantee being herein referred to
as the Lien Grantor's "Guaranty"); and]
WHEREAS, pursuant to the terms of the Second Priority Security
Agreement dated as of April 20, 2001 (as such agreement may be amended from time
to time, the "Security Agreement") among Vencor Operating, Inc., the Guarantors
party thereto and Xxxxxx Guaranty Trust Company of New York, as Collateral Agent
for the Secured Parties referred to therein (in such capacity, together with its
successors in such capacity, the "Grantee"), the Lien Grantor has granted to the
Grantee for the benefit of such Secured Parties a continuing security interest
in or other Lien (as defined in the Credit Agreement) on substantially all the
assets of the Lien Grantor (except certain excluded assets), including all
right, title
________________
/1/ Modify as needed for any Lien Grantor that is not a corporation.
B-1
and interest of the Lien Grantor in, to and under the Copyright Collateral (as
defined below), whether now owned or existing or hereafter acquired or arising,
to secure the Secured Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Lien Grantor does hereby grant
to the Grantee, to secure the Secured Obligations, a continuing security
interest in all of the Lien Grantor's right, title and interest in, to and under
the following (all of the following items or types of property being herein
collectively referred to as the "Copyright Collateral"), whether now owned or
existing or hereafter acquired or arising:
(i) each Copyright (as defined in the Security Agreement)
owned by the Lien Grantor, including, without limitation, each
Copyright registration or application therefor referred to in Schedule
1 hereto;
(ii) each Copyright License (as defined in the Security
Agreement) to which the Lien Grantor is a party, including, without
limitation, each Copyright License identified in Schedule 1 hereto; and
(iii) all proceeds of and revenues from, accounts and general
intangibles arising out of, the foregoing, including, without
limitation, all proceeds of and revenues from any claim by the Lien
Grantor against third parties for past, present or future infringement
of any Copyright, including, without limitation, any Copyright owned by
the Lien Grantor referred to in Schedule 1, and all rights and benefits
of the Lien Grantor under any Copyright License, including, without
limitation, any Copyright License identified in Schedule 1 hereto.
The Lien Grantor hereby irrevocably constitutes and appoints the
Grantee and any officer or agent thereof, with full power of substitution, as
its true and lawful attorney-in-fact with full power and authority in the name
of the Lien Grantor or in its name, from time to time, in the Grantee's
discretion, so long as any Enforcement Notice (as defined in the Credit
Agreement) is in effect, to take with respect to the Copyright Collateral any
and all appropriate action which the Lien Grantor might take with respect to the
Copyright Collateral and to execute any and all documents and instruments which
may be necessary or desirable to carry out the terms of this Second Priority
Copyright Security Agreement and to accomplish the purposes hereof.
Except to the extent permitted in the Security Agreement or the Credit
Agreement, the Lien Grantor agrees not to sell, license, exchange, assign or
B-2
otherwise transfer or dispose of, or grant any rights with respect to, or
mortgage or otherwise encumber, any of the foregoing Copyright Collateral.
The foregoing security interest is granted in conjunction with the
security interests granted by the Lien Grantor to the Grantee pursuant to the
Security Agreement. The Lien Grantor does hereby further acknowledge and affirm
that the rights and remedies of the Grantee with respect to the security
interest in the Copyright Collateral granted hereby are more fully set forth in
the Security Agreement, the terms and provisions of which are incorporated by
reference herein as if fully set forth herein.
B-3
IN WITNESS WHEREOF, the Lien Grantor has caused this Second Priority
Copyright Security Agreement to be duly executed by its officer thereunto duly
authorized as of the ____ day of _______, ____.
[NAME OF LIEN GRANTOR]
By: __________________________
Title:
Acknowledged:
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Collateral Agent
By: __________________________
Title:
B-4
STATE OF ________ )
) ss.:
COUNTY OF ________ )
I, ______________________, a Notary Public in and for said
County, in the State aforesaid, DO HEREBY CERTIFY, that
_________________________, _______________ of [NAME OF LIEN GRANTOR] (the
"Company"), personally known to me to be the same person whose name is
subscribed to the foregoing instrument as such _________________, appeared
before me this day in person and acknowledged that (s)he signed, executed and
delivered the said instrument as her/his own free and voluntary act and as the
free and voluntary act of said Company, for the uses and purposes therein set
forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this ___ day of
________________, _____.
[Seal]
________________________________
Signature of notary public
My Commission expires __________
B-5
Schedule 1
to Second Priority Copyright
Security Agreement
--------------------
[NAME OF LIEN GRANTOR]
COPYRIGHT REGISTRATIONS
Registration Registration Expiration
------------ ------------ ----------
No. Date Title Date
--- ---- ----- ----
1
EXHIBIT C
to Second Priority Security Agreement
SECOND PRIORITY PATENT SECURITY AGREEMENT
(Patents, Patent Applications and Patent Licenses)
WHEREAS, [Name of Lien Grantor], a _____________ corporation/1/ (herein
referred to as the "Lien Grantor") owns, or in the case of licenses, is a party
to, the Patent Collateral (as defined below);
WHEREAS, Vencor Operating, Inc. (to be renamed Kindred Healthcare
Operating, Inc.), Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), the
Lenders referred to therein and Xxxxxx Guaranty Trust Company of New York, as
Administrative Agent and Collateral Agent, are parties to a Credit Agreement
dated as of April 20, 2001 (as amended from time to time, the "Credit
Agreement");
[WHEREAS, pursuant to the terms of a Second Priority Subsidiary
Guaranty Agreement dated as of __________, ____, the Lien Grantor has
guaranteed, subject to certain limitations, certain obligations of Vencor
Operating, Inc. (such guarantee being herein referred to as the Lien Grantor's
"Guaranty"); and]
[WHEREAS, pursuant to the terms of the Second Priority Vencor Guaranty
Agreement dated as of April 20, 2001, the Lien Grantor has guaranteed certain
obligations of Vencor Operating, Inc. (such guarantee being herein referred to
as the Lien Grantor's "Guaranty"); and]
WHEREAS, pursuant to the terms of the Second Priority Security
Agreement dated as of April 20, 2001 (as such agreement may be amended from time
to time, the "Security Agreement") among Vencor Operating, Inc., the Guarantors
party thereto and Xxxxxx Guaranty Trust Company of New York, as Collateral Agent
for the Secured Parties referred to therein (in such capacity, together with its
successors in such capacity, the "Grantee"), the Lien Grantor has granted to the
Grantee for the benefit of such Secured Parties a continuing security interest
in or other Lien (as defined in the Credit Agreement) on substantially all the
assets of the Lien Grantor (except certain excluded assets), including all
right, title and interest of the Lien Grantor in, to and under the Patent
Collateral (as defined below), whether now owned or existing or hereafter
acquired or arising, to secure the Secured Obligations (as defined in the
Security Agreement);
___________________
/1/ Modify as needed for any Lien Grantor that is not a corporation.
C-1
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Lien Grantor does hereby grant
to the Grantee, to secure the Secured Obligations, a continuing security
interest in all of the Lien Grantor's right, title and interest in, to and under
the following (all of the following items or types of property being herein
collectively referred to as the "Patent Collateral"), whether now owned or
existing or hereafter acquired or arising:
(i) each Patent (as defined in the Security Agreement) owned
by the Lien Grantor, including, without limitation, each Patent
referred to in Schedule 1 hereto;
(ii) each Patent License (as defined in the Security
Agreement) to which the Lien Grantor is a party, including, without
limitation, each Patent License identified in Schedule 1 hereto; and
(iii) all proceeds of and revenues from the foregoing,
including, without limitation, all proceeds of and revenues from any
claim by the Lien Grantor against third parties for past, present or
future infringement of any Patent owned by the Lien Grantor, including,
without limitation, any Patent referred to in Schedule 1 hereto, and
all rights and benefits of the Lien Grantor under any Patent License,
including, without limitation, any Patent License identified in
Schedule 1 hereto.
The Lien Grantor hereby irrevocably constitutes and appoints the
Grantee and any officer or agent thereof, with full power of substitution, as
its true and lawful attorney-in-fact with full power and authority in the name
of the Lien Grantor or in its name, from time to time, in the Grantee's
discretion, so long as any Enforcement Notice (as defined in the Credit
Agreement) is in effect, to take with respect to the Patent Collateral any and
all appropriate action which the Lien Grantor might take with respect to the
Patent Collateral and to execute any and all documents and instruments which may
be necessary or desirable to carry out the terms of this Second Priority Patent
Security Agreement and to accomplish the purposes hereof.
Except to the extent permitted in the Security Agreement or the Credit
Agreement, the Lien Grantor agrees not to sell, license, exchange, assign or
otherwise transfer or dispose of, or grant any rights with respect to, or
mortgage or otherwise encumber, any of the Patent Collateral.
The foregoing security interest is granted in conjunction with the
security interests granted by the Lien Grantor to the Grantee pursuant to the
Security Agreement. The Lien Grantor does hereby further acknowledge and affirm
that the
C-2
rights and remedies of the Grantee with respect to the security interest in the
Patent Collateral granted hereby are more fully set forth in the Security
Agreement, the terms and provisions of which are incorporated by reference
herein as if fully set forth herein.
C-3
IN WITNESS WHEREOF, the Lien Grantor has caused this Second Priority
Patent Security Agreement to be duly executed by its officer thereunto duly
authorized as of the ____ day of ____________, ____.
[NAME OF LIEN GRANTOR]
By: _______________________________
Title:
Acknowledged:
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Collateral Agent
By: _________________________
Title:
C-4
STATE OF __________ )
) ss.:
COUNTY OF _________ )
I, ______________________, a Notary Public in and for said County, in
the State aforesaid, DO HEREBY CERTIFY, that _________________________,
_______________ of [NAME OF LIEN GRANTOR] (the "Company"), personally known to
me to be the same person whose name is subscribed to the foregoing instrument as
such _________________, appeared before me this day in person and acknowledged
that (s)he signed, executed and delivered the said instrument as her/his own
free and voluntary act and as the free and voluntary act of said Company, for
the uses and purposes therein set forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this ___ day of _______________,
____.
[Seal]
________________________________
Signature of notary public
My Commission expires __________
C-5
EXHIBIT D
to Second Priority Security Agreement
SECOND PRIORITY TRADEMARK SECURITY AGREEMENT
(Trademarks, Trademark Registrations, Trademark
Applications and Trademark Licenses)
WHEREAS, [Name of Lien Grantor], a _____________ corporation/1/ (herein
referred to as the "Lien Grantor") owns, or in the case of licenses, is a party
to, the Trademark Collateral (as defined below);
WHEREAS, Vencor Operating, Inc. (to be renamed Kindred Healthcare
Operating, Inc.), Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), the
Lenders referred to therein and Xxxxxx Guaranty Trust Company of New York, as
Administrative Agent and Collateral Agent, are parties to a Credit Agreement
dated as of April 20, 2001 (as amended from time to time, the "Credit
Agreement");
[WHEREAS, pursuant to the terms of a Second Priority Subsidiary
Guaranty Agreement dated as of __________, ____, the Lien Grantor has
guaranteed, subject to certain limitations, certain obligations of Vencor
Operating, Inc. (such guarantee being herein referred to as the Lien Grantor's
"Guaranty"); and]
[WHEREAS, pursuant to the terms of the Second Priority Vencor Guaranty
Agreement dated as of April 20, 2001, the Lien Grantor has guaranteed certain
obligations of Vencor Operating, Inc. (such guarantee being herein referred to
as the Lien Grantor's "Guaranty"); and]
WHEREAS, pursuant to the terms of the Second Priority Security
Agreement dated as of April 20, 2001 (as such agreement may be amended from time
to time, the "Security Agreement") among Vencor Operating, Inc., the Guarantors
party thereto and Xxxxxx Guaranty Trust Company of New York, as Collateral Agent
for the Secured Parties referred to therein (in such capacity, together with its
successors in such capacity, the "Grantee"), the Lien Grantor has granted to the
Grantee for the benefit of such Secured Parties a continuing security interest
in or other Lien (as defined in the Credit Agreement) on substantially all the
assets of the Lien Grantor (except certain excluded assets), including all
right, title and interest of the Lien Grantor in, to and under the Trademark
Collateral (as
____________________________
/1/ Modify as needed for any Lien Grantor that is not a corporation.
D-1
defined below), whether now owned or existing or hereafter acquired or arising,
to secure the Secured Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Lien Grantor does hereby grant
to the Grantee, to secure the Secured Obligations, a continuing security
interest in all of the Lien Grantor's right, title and interest in, to and under
the following (all of the following items or types of property being herein
collectively referred to as the "Trademark Collateral"), whether now owned or
existing or hereafter acquired or arising:
(i) each Trademark (as defined in the Security Agreement)
owned by Lien Grantor, including, without limitation, each Trademark
registration and application referred to in Schedule 1 hereto, and all
of the goodwill of the business connected with the use of, or
symbolized by, each Trademark;
(ii) each Trademark License (as defined in the Security
Agreement) to which the Lien Grantor is a party, including, without
limitation, each Trademark License identified in Schedule 1 hereto, and
all of the goodwill of the business connected with the use of, or
symbolized by, each Trademark licensed pursuant thereto; and
(iii) all proceeds of and revenues from the foregoing,
including, without limitation, all proceeds of and revenues from any
claim by the Lien Grantor against third parties for past, present or
future unfair competition with, or violation of intellectual property
rights in connection with or injury to, or infringement or dilution of,
any Trademark owned by the Lien Grantor, including, without limitation,
any Trademark referred to in Schedule 1 hereto, and all rights and
benefits of the Lien Grantor under any Trademark License, including,
without limitation, any Trademark License identified in Schedule 1
hereto, or for injury to the goodwill associated with any of the
foregoing.
The Lien Grantor hereby irrevocably constitutes and appoints
the Grantee and any officer or agent thereof, with full power of substitution,
as its true and lawful attorney-in-fact with full power and authority in the
name of the Lien Grantor or in its name, from time to time, in the Grantee's
discretion, so long as any Enforcement Notice (as defined in the Credit
Agreement) is in effect, to take with respect to the Trademark Collateral any
and all appropriate action which the Lien Grantor might take with respect to the
Trademark Collateral and to execute any and all documents and instruments which
may be necessary or desirable to carry out the terms of this Second Priority
Trademark Security Agreement and to accomplish the purposes hereof.
D-2
Except to the extent permitted in the Security Agreement or the Credit
Agreement, the Lien Grantor agrees not to sell, license, exchange, assign or
otherwise transfer or dispose of, or grant any rights with respect to, or
mortgage or otherwise encumber, any of the foregoing Trademark Collateral.
The foregoing security interest is granted in conjunction with the
security interests granted by the Lien Grantor to the Grantee pursuant to the
Security Agreement. The Lien Grantor does hereby further acknowledge and affirm
that the rights and remedies of the Grantee with respect to the security
interest in the Trademark Collateral granted hereby are more fully set forth in
the Security Agreement, the terms and provisions of which are incorporated by
reference herein as if fully set forth herein.
D-3
IN WITNESS WHEREOF, the Lien Grantor has caused this Second Priority
Trademark Security Agreement to be duly executed by its officer thereunto duly
authorized as of the ____ day of __________, ____.
[NAME OF LIEN GRANTOR]
By: _________________________
Title:
Acknowledged:
XXXXXX GUARANTY TRUST COMPANY
OF NEW YORK, as Collateral Agent
By: ________________________
Title:
D-4
STATE OF __________ )
) ss.:
COUNTY OF _________ )
I, ______________________, a Notary Public in and for said County, in
the State aforesaid, DO HEREBY CERTIFY, that _________________________,
_______________ of [NAME OF LIEN GRANTOR] (the "Company"), personally known to
me to be the same person whose name is subscribed to the foregoing instrument as
such _________________, appeared before me this day in person and acknowledged
that (s)he signed, executed and delivered the said instrument as her/his own
free and voluntary act and as the free and voluntary act of said Company, for
the uses and purposes therein set forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this ___ day of_______________,
____.
[Seal]
________________________________
Signature of notary public
My Commission expires __________
D-5
Schedule 1
to Second Priority Trademark
Security Agreement
[NAME OF LIEN GRANTOR]
U.S. TRADEMARK REGISTRATIONS
--------------------------------------------------------------------------------
TRADEMARK REG. NO. REG. DATE
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
U.S. TRADEMARK APPLICATIONS
--------------------------------------------------------------------------------
TRADEMARK REG. NO. REG. DATE
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
1
EXCLUSIVE TRADEMARK LICENSES
Name of Parties Date of Subject
Agreement Licensor/Licensee Agreement Matter
-------------- ---------------------- -------------------- ---------------------
2
EXHIBIT E
to Second Priority Security Agreement
PERFECTION CERTIFICATE
The undersigned, an authorized officer of [NAME OF LIEN GRANTOR], a
[jurisdiction of incorporation] corporation/1/ (the "Company"), hereby certify
with reference to the Second Priority Security Agreement dated as of April 20,
2001 among the Company, [the Issuer], the [other] Guarantors and Xxxxxx Guaranty
Trust Company of New York, as Collateral Agent (terms defined therein being used
herein as therein defined), to the Collateral Agent and each other Lender Party
as follows:
1. Names./1/ (a) The exact corporate name of the Company as it appears
in its certificate of incorporation is as follows:
(b) Set forth below is each other corporate name the Company has had
since its organization, together with the date of the relevant change.
(c) Except as set forth in Schedule 1, the Company has not changed its
identity or corporate structure in any way within the past five years.
[Changes in identity or corporate structure would include mergers,
consolidations and acquisitions, as well as any change in the form,
nature or jurisdiction of corporate organization. If any such change
has occurred, include in Schedule 1 the information required by
paragraphs 1, 2 and 3 of this certificate as to each acquiree or
constituent party to a merger or consolidation.]
(d) The following is a list of all other names (including trade names
or similar appellations) used by the Company or any of its divisions or other
business units at any time during the past five years:
2. Current Locations. (a) The chief executive office of the Company is
located at the following address:
Mailing Address County State
---------------------------------- --------------------- -------------
______________
/1/ Modify as needed for any Lien Grantor that is not a corporation.
E-1
(b) The following are all the locations where the Company maintains
any books or records relating to any Accounts:
Mailing Address County State
-------------------------------- ----------------- -----------------
(c) The following are all the places of business of the Company not
identified above:
Mailing Address County State
-------------------------------- ----------------- -----------------
(d) The following are all the locations where the Company maintains
any Inventory not identified above:
Mailing Address County State
-------------------------------- ----------------- -----------------
(e) The following are the names and addresses of all Persons other
than the Company which have possession of any of the Company's Inventory:
Mailing Address County State
-------------------------------- ----------------- -----------------
3. Prior Locations. (a) Set forth below is the information required
by subparagraphs 2(a), 2(b) and 2(c) above with respect to each location or
place of business maintained by the Company at any time during the past five
years:
(b) Set forth below is the information required by subparagraphs 2(d)
and 2(e) above with respect to each location or bailee where or with whom
Inventory has been lodged at any time during the past four months:
4. Unusual Transactions. Except as set forth in Schedule 4, all
Accounts have been originated by the Company and all Inventory and Equipment has
been acquired by the Company in the ordinary course of its business.
5. File Search Reports. Attached hereto as Schedule 5(A) is a true
copy of a file search report from the Uniform Commercial Code filing officer in
E-2
each jurisdiction identified in paragraph 2 or 3 above with respect to each name
set forth in paragraph 1 above. Attached hereto as Schedule 5(B) is a true copy
of each financing statement or other filing identified in such file search
reports.
6. UCC Filings. A duly signed financing statement on Form UCC-1 in
the form required by the Collateral Agent pursuant to the Security Agreement has
been provided to the Collateral Agent for due filing in the Uniform Commercial
Code filing office in each jurisdiction identified in paragraph 2 hereof.
7. Filing Fees. All filing fees and taxes payable in connection with
the filings described in paragraph 6 above have been paid or will be paid before
or at the time of such filing.
E-3
IN WITNESS WHEREOF, we have hereunto set our hands this __ day of
__________, 20____
____________________________
Name:
Title:
E-4
EXHIBIT F
to Second Priority Security Agreement
FORM OF SECOND PRIORITY LEASEHOLD MORTGAGE
F-1
EXHIBIT G
to Second Priority Security Agreement
FORM OF SECOND PRIORITY FEE MORTGAGE
G-1
EXHIBIT H
to Second Priority Security Agreement
FORM OF ACCOUNT CONTROL AGREEMENT
H-1
EXHIBIT C
SECOND PRIORITY SUBSIDIARY GUARANTY AGREEMENT
Guaranty Agreement dated as of April 20, 2001 (as amended from time to
time, this "Guaranty Agreement") by the undersigned Subsidiaries (the
"Subsidiary Guarantors") of Vencor Operating, Inc. (to be renamed Kindred
Healthcare Operating, Inc.), a Delaware corporation (the "Issuer"), for the
benefit of the Lender Parties (as such term is defined in the Credit Agreement
referred to below).
WHEREAS, the Issuer has entered into a Credit Agreement dated as of April
20, 2001 (the "Credit Agreement") among the Issuer, Vencor, Inc. (to be renamed
Kindred Healthcare, Inc.) ("Vencor"), the Lenders party thereto and Xxxxxx
Guaranty Trust Company of New York, as Administrative Agent and Collateral
Agent, pursuant to which the Issuer intends to issue senior secured notes with a
stated principal amount of $300,000,000 to the Lenders in partial satisfaction
of the claims of the Lenders arising under the $1,000,000,000 Credit Agreement
dated as of April 29, 1998 (as amended, the "Pre-Petition Senior Credit
Agreement") among the Issuer, Vencor and a group of banks and other financial
institutions, in connection with which Bank of America N.A. (previously named
Nationsbank N.A.) acted as administrative agent and Xxxxxx Guaranty Trust
Company of New York acted as documentation agent and collateral agent; and
WHEREAS, the Lenders are willing to accept the notes described above in
partial settlement of their claims under the Pre-Petition Senior Credit
Agreement only if the Issuer causes each of its Restricted Subsidiaries to
guarantee the performance of the Issuer's obligations under the Financing
Documents referred to in the Credit Agreement;
NOW, THEREFORE, each Subsidiary Guarantor agrees as follows:
Section 1. Definitions. Terms defined in the Credit Agreement and not
otherwise defined herein have, as used herein, the respective meanings provided
for therein. The following additional terms, as used herein, have the following
meanings:
"Senior Collateral Agent" has the meaning set forth in the Security
Agreement.
"Senior Subsidiary Guaranty Agreement" has the meaning set forth in the
Security Agreement.
Section 2. The Guarantees. Each Subsidiary Guarantor, jointly and
severally, unconditionally and irrevocably guarantees the full and punctual
payment of all present and future indebtedness and other obligations of the
Issuer evidenced by or arising under any Financing Document as and when the same
shall become due and payable, whether at maturity or by declaration or
otherwise, according to the terms hereof and thereof (including any interest
which accrues on any of the foregoing obligations after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency or
reorganization of the Issuer, whether or not allowed or allowable as a claim in
any such proceeding). If the Issuer fails punctually to pay any indebtedness or
other obligation guaranteed hereby, each Subsidiary Guarantor unconditionally
agrees to cause such payment to be made punctually as and when the same shall
become due and payable, whether at maturity or by declaration or otherwise, and
as if such payment were made by the Issuer.
Section 3. Taxes. Each Subsidiary Guarantor agrees to comply with Section
10.02 of the Credit Agreement as if it were a party thereto.
Section 4. Guarantee Unconditional. Except as provided in Section 10
hereof, the obligations of each Subsidiary Guarantor under this Guaranty
Agreement shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(a) any extension, renewal, settlement, compromise, waiver or release in
respect of any obligation of the Issuer or any other Guarantor under any
Financing Document by operation of law or otherwise;
(b) any modification, amendment or waiver of or supplement to any Financing
Document;
(c) any release, impairment, non-perfection or invalidity of any direct or
indirect security, or of any guarantee or other liability of any third party,
for any obligation of the Issuer or any other Guarantor under any Financing
Document;
(d) any change in the corporate existence, structure or ownership of the
Issuer or any other Guarantor, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting the Issuer or any other Guarantor or its
assets, or any resulting release or discharge of any obligation of the Issuer or
any other Guarantor contained in any Financing Document;
2
(e) the existence of any claim, set-off or other rights which such
Subsidiary Guarantor may have at any time against the Issuer, any other
Guarantor, any Lender Party or any other Person, whether or not arising in
connection with this Guaranty Agreement; provided that nothing herein shall
prevent the assertion of any such claim by separate suit or compulsory
counterclaim;
(f) any invalidity or unenforceability relating to or against the Issuer or
any other Guarantor for any reason of any Financing Document or any provision of
applicable law or regulation purporting to prohibit the payment by the Issuer or
any other Guarantor of any amount payable by it under any Financing Document; or
(g) any other act or omission to act or delay of any kind by the Issuer,
any other Guarantor, any Lender Party or any other Person or any other
circumstance whatsoever that might, but for the provisions of this Section,
constitute a legal or equitable discharge of such Subsidiary Guarantor's
obligations under this Guaranty Agreement.
Section 5. Discharge Only Upon Payment in Full; Reinstatement in Certain
Circumstances. Each Subsidiary Guarantor's obligations under this Guaranty
Agreement constitute a continuing guaranty and shall remain in full force and
effect until all amounts payable by the Issuer under the Financing Documents
shall have been paid in full. If at any time any amount payable by the Issuer
under any Financing Document is rescinded or must be otherwise restored or
returned upon the insolvency, bankruptcy or reorganization of the Issuer or
otherwise, each Subsidiary Guarantor's obligations under this Guaranty Agreement
with respect to such payment shall be reinstated at such time as though such
payment had become due but had not been made at such time.
Section 6. Subordination. (a) The obligations of each Subsidiary Guarantor
under this Agreement (the "Second Priority Guarantee Obligations" of such
Subsidiary Guarantor) shall be subordinated in right of payment, to the extent
and in the manner provided in this Section, to the prior payment by such
Subsidiary Guarantor of its obligations under the Senior Subsidiary Guaranty
Agreement (the "Senior Guarantee Obligations" of such Subsidiary Guarantor). The
subordination provisions in this Section are for the benefit of and enforceable
by holders of Senior Obligations from time to time.
(b) (i) No payment will be made on account of the Second Priority Guarantee
Obligations of any Subsidiary Guarantor until the payment in full of all Senior
Obligations.
3
(ii) If any payment or distribution of assets of any Subsidiary
Guarantor is received by any Lender Party in respect of the Second Priority
Guarantee Obligations of such Subsidiary Guarantor at a time when that
payment or distribution should not have been made as a result of clause (i)
above, such payment or distribution will be received and held in trust for
and will be paid over to the holders of Senior Obligations in respect of
Senior Guarantee Obligations of such Subsidiary Guarantor which are due and
payable and remain unpaid or unprovided for in cash or cash equivalents
until all such Senior Guarantee Obligations have been paid in full or
provided for in cash or cash equivalents (as allocated by the Senior
Collateral Agent), after giving effect to any concurrent payment or
distribution or provision therefor to the holders of Senior Obligations.
(c) Upon any payment or distribution of the assets of any Subsidiary
Guarantor to creditors upon a total or partial liquidation or a total or partial
dissolution of such Subsidiary Guarantor or in a bankruptcy, reorganization,
insolvency, receivership or similar proceeding relating to such Subsidiary
Guarantor or its property:
(i) holders of Senior Obligations are entitled to receive payment in
full in cash of all amounts then due in respect of Senior Guarantee
Obligations of such Subsidiary Guarantor, including all interest accrued or
accruing on Senior Guarantee Obligations after the commencement of any
bankruptcy, insolvency or reorganization or similar case or proceeding in
respect of either the Issuer or such Subsidiary Guarantor at the contract
rate (including, without limitation, any contract rate applicable upon
default) specified in the relevant documentation, whether or not the claim
for the interest is allowed as a claim in the case or proceeding with
respect to the Senior Guarantee Obligations (only such payment constituting
"payment in full") before the Lenders will be entitled to receive any
payment on account of the Second Priority Guarantee Obligations of such
Subsidiary Guarantor; and
(ii) until the Senior Guarantee Obligations of such Subsidiary
Guarantor are paid in full, any payment or distribution to which Lenders
would be entitled but for these subordination provisions shall instead be
made to holders of Senior Obligations as their interests may appear.
(d) If a payment or other distribution is made to Lenders on account of
the Second Priority Guarantee Obligations that because of these subordination
provisions should not have been made to them, the Lenders that receive the
distribution shall hold it in trust to be paid over to holders of Senior
Obligations or their representatives for application to the payment of the
Senior Guarantee Obligations.
4
(e) A distribution made by a Subsidiary Guarantor under these subordination
provisions to holders of Senior Obligations of such Subsidiary Guarantor which
otherwise would have been made to the Lenders is not, as between such Subsidiary
Guarantor and the Lenders, a payment by such Subsidiary Guarantor on its Senior
Guarantee Obligations. After all Senior Guarantee Obligations of any Subsidiary
Guarantor are paid in full, Lenders will be subrogated to the rights of holders
of Senior Guarantee Obligations to receive payments in respect of Senior
Guarantee Obligations of such Subsidiary Guarantor, which, to the extent
received by Lenders, do not constitute, as between such Subsidiary Guarantor and
the Lenders, payments by such Subsidiary Guarantor on its Second Priority
Guarantee Obligations.
(f) Subject to the Intercreditor Agreement, these subordination provisions
define the relative rights of Lenders and holders of Senior Obligations and do
not impair, as between the Subsidiary Guarantors and Lenders, the obligation of
the Subsidiary Guarantors, which are absolute and unconditional, to pay to the
Lenders the Second Priority Guarantee Obligations in accordance with their
terms. The failure to make a payment pursuant to the Second Priority Guarantee
Obligations by reason of these subordination provisions does not prevent the
occurrence of a Default, nor do these subordination provisions have any effect
on the right of the Lenders or the Administrative Agent to accelerate the
maturity of the Notes upon an Event of Default or prevent the Administrative
Agent or any Lender from exercising its available remedies upon a Default,
subject to the rights of holders of Senior Obligations, if any, to receive
distributions otherwise payable to Lenders under this Section and under the
Intercreditor Agreement.
(g) No right of any holder of Senior Obligations to enforce the
subordination as provided herein will be impaired by any act or failure to act
by any Subsidiary Guarantor or by its failure to comply with this Agreement.
Section 7. Waiver. Each Subsidiary Guarantor irrevocably waives acceptance
hereof, presentment, demand, protest and any notice not provided for herein, as
well as any requirement that at any time any action be taken by any Person
against the Issuer or any other Person or against any security.
Section 8. Subrogation and Contribution. When any Subsidiary Guarantor
makes any payment hereunder with respect to the obligations of the Issuer, such
Subsidiary Guarantor shall be subrogated to the rights of the payee against the
Issuer with respect to the portion of such obligations paid by such Subsidiary
Guarantor, and shall also have a right of contribution in respect of such
payment against all other Guarantors pro rata among them based on their
respective net fair value as enterprises; provided that such Subsidiary
Guarantor shall not enforce any payment by way of subrogation against the Issuer
or
5
contribution against any other Guarantor so long as any amount payable by the
Issuer under any Financing Document remains unpaid.
Section 9. Stay of Acceleration. If acceleration of the time for payment
of any amount payable by the Issuer under any Financing Document is stayed upon
the insolvency, bankruptcy or reorganization of the Issuer, all such amounts
otherwise subject to acceleration under the terms of such Financing Document
shall nonetheless be payable by each Subsidiary Guarantor hereunder forthwith on
demand by the Administrative Agent made at the request of the Required Lenders.
Section 10. Limit of Liability. The Subsidiary Guarantors and the
beneficiaries of this Guaranty Agreement intend that this Guaranty Agreement
shall be enforced to the fullest extent permissible under the laws and public
policies applied in each jurisdiction in which enforcement is sought. If and to
the extent that the obligations of any Subsidiary Guarantor under this Guaranty
Agreement would, in the absence of this sentence, be adjudicated to be invalid
or unenforceable because of any applicable state or federal law relating to
fraudulent conveyances or transfers, then the amount of such Subsidiary
Guarantor's liability hereunder in respect of the obligations of the Issuer
guaranteed hereunder shall be deemed to be reduced ab initio to the maximum
amount which would be permitted without causing such Subsidiary Guarantor's
obligations hereunder to be so invalidated.
Section 11. Notices. Notices and other communications hereunder shall be
given in writing in the manner specified in or pursuant to Section 12.01 of the
Credit Agreement.
Section 12. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS GUARANTY
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES. EACH SUBSIDIARY GUARANTOR HEREBY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN NEW YORK CITY FOR PURPOSES
OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THE FINANCING DOCUMENTS
OR THE TRANSACTIONS CONTEMPLATED THEREBY. EACH SUBSIDIARY GUARANTOR IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY NOW
OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN
SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN
6
SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
Section 13. Successors and Assigns. This Guaranty Agreement is for the
benefit of holders of Senior Obligations, the Lender Parties and their
respective successors and assigns. If any Loans (as evidenced by the Notes) or
other amounts payable under the Financing Documents are assigned pursuant to
Section 12.06 of the Credit Agreement, the rights hereunder, to the extent
applicable to the indebtedness so assigned, shall be transferred with such
indebtedness.
Section 14. No Waiver. No failure or delay by any Lender Party in
exercising any right, power or privilege under any Financing Document shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided in the Financing
Documents shall be cumulative and not exclusive of any rights or remedies
provided by law.
Section 15. Amendments and Waivers. Any provision of this Guaranty
Agreement may be amended, supplemented, modified or waived as (and only as)
provided in Section 12.05 of the Credit Agreement and the Intercreditor
Agreement.
Section 16. Counterparts. This Guaranty 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 were upon the same instrument.
Section 17. WAIVER OF JURY TRIAL. EACH SUBSIDIARY GUARANTOR HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS GUARANTY AGREEMENT, THE OTHER FINANCING
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY. EACH SUBSIDIARY GUARANTOR
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES TO THE FINANCING DOCUMENTS HAVE BEEN INDUCED TO
ENTER INTO THIS GUARANTY AGREEMENT AND THE OTHER FINANCING DOCUMENTS, AS
APPLICABLE, BY (AMONG OTHER THINGS) THE WAIVERS AND CERTIFICATIONS IN THIS
SECTION 17 AND SECTION 12.10 OF THE CREDIT AGREEMENT.
Section 18. Intercreditor Agreement. Each Subsidiary Guarantor acknowledges
and agrees that notwithstanding anything herein to the contrary, the terms of
this Agreement are subject to the Intercreditor Agreement and subordinated as
provided therein.
7
IN WITNESS WHEREOF, each Subsidiary Guarantor has caused this Guaranty
Agreement to be duly executed by its authorized officer as of the day and year
first above written.
[ ]
By:________________________________
Name:
Title:
[ ]
By:________________________________
Name:
Title:
[ ]
By:________________________________
Name:
Title:
EXHIBIT D
SECOND PRIORITY VENCOR GUARANTY AGREEMENT
Guaranty Agreement dated as of April 20, 2001 (as amended from time to
time, this "Guaranty Agreement") by Vencor, Inc. (to be renamed Kindred
Healthcare, Inc.), a Delaware corporation ("Vencor"), for the benefit of the
Lender Parties (as such term is defined in the Credit Agreement referred to
below).
WHEREAS, Vencor Operating, Inc. (to be renamed Kindred Healthcare
Operating, Inc.), a Delaware corporation and wholly owned subsidiary of Vencor
(the "Issuer"), has entered into a Credit Agreement dated as of April 20, 2001
(the "Credit Agreement") among the Issuer, Vencor, the Lenders party thereto and
Xxxxxx Guaranty Trust Company of New York, as Administrative Agent and
Collateral Agent, pursuant to which the Issuer intends to issue senior secured
notes with a stated principal amount of $300,000,000 to the Lenders in partial
satisfaction of the claims of the Lenders arising under the $1,000,000,000
Credit Agreement dated as of April 29, 1998 (as amended, the "Pre-Petition
Senior Credit Agreement") among the Issuer, Vencor and a group of banks and
other financial institutions, in connection with which Bank of America N.A.
(previously named Nationsbank N.A.) acted as administrative agent and Xxxxxx
Guaranty Trust Company of New York acted as documentation agent and collateral
agent; and
WHEREAS, the Lenders are willing to accept the notes described above in
partial settlement of their claims under the Pre-Petition Senior Credit
Agreement only if Vencor guarantees the performance of the Issuer's obligations
under the Financing Documents referred to in the Credit Agreement;
NOW, THEREFORE, Vencor agrees as follows:
Section 1. Definitions. Terms defined in the Credit Agreement and not
otherwise defined herein have, as used herein, the respective meanings provided
for therein. The following additional terms, as used herein, have the following
meanings:
"Senior Collateral Agent" has the meaning set forth in the Security
Agreement.
"Senior Vencor Guaranty Agreement" has the meaning set forth in the
Security Agreement.
Section 2. The Guarantee. Vencor unconditionally and irrevocably guarantees
the full and punctual payment of all present and future indebtedness and other
obligations of the Issuer evidenced by or arising under any Financing Document
as and when the same shall become due and payable, whether at maturity or by
declaration or otherwise, according to the terms hereof and thereof (including
any interest which accrues on any of the foregoing obligations after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Issuer, whether or not allowed or allowable
as a claim in any such proceeding). If the Issuer fails punctually to pay any
indebtedness or other obligation guaranteed hereby, Vencor unconditionally
agrees to cause such payment to be made punctually as and when the same shall
become due and payable, whether at maturity or by declaration or otherwise, and
as if such payment were made by the Issuer.
Section 3. Guarantee Unconditional. The obligations of Vencor under this
Guaranty Agreement shall be unconditional and absolute and, without limiting the
generality of the foregoing, shall not be released, discharged or otherwise
affected by:
(a) any extension, renewal, settlement, compromise, waiver or release in
respect of any obligation of the Issuer or any other Guarantor under any
Financing Document by operation of law or otherwise;
(b) any modification, amendment or waiver of or supplement to any Financing
Document;
(c) any release, impairment, non-perfection or invalidity of any direct or
indirect security, or of any guarantee or other liability of any third party,
for any obligation of the Issuer or any other Guarantor under any Financing
Document;
(d) any change in the corporate existence, structure or ownership of the
Issuer or any other Guarantor, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting the Issuer or any other Guarantor or its
assets, or any resulting release or discharge of any obligation of the Issuer or
any other Guarantor contained in any Financing Document;
(e) the existence of any claim, set-off or other rights which Vencor may
have at any time against the Issuer, any other Guarantor, any Lender Party or
any other Person, whether or not arising in connection with this Guaranty
Agreement;
2
provided that nothing herein shall prevent the assertion of any such claim by
separate suit or compulsory counterclaim;
(f) any invalidity or unenforceability relating to or against the Issuer or
any other Guarantor for any reason of any Financing Document or any provision of
applicable law or regulation purporting to prohibit the payment by the Issuer or
any other Guarantor of any amount payable by it under any Financing Document; or
(g) any other act or omission to act or delay of any kind by the Issuer,
any other Guarantor, any Lender Party or any other Person or any other
circumstance whatsoever that might, but for the provisions of this Section,
constitute a legal or equitable discharge of Vencor's obligations under this
Guaranty Agreement.
Section 4. Discharge Only Upon Payment in Full; Reinstatement in Certain
Circumstances. Vencor's obligations under this Guaranty Agreement constitute a
continuing guaranty and shall remain in full force and effect until all amounts
payable by the Issuer under the Financing Documents shall have been paid in
full. If at any time any amount payable by the Issuer under any Financing
Document is rescinded or must be otherwise restored or returned upon the
insolvency, bankruptcy or reorganization of the Issuer or otherwise, Vencor's
obligations under this Guaranty Agreement with respect to such payment shall be
reinstated at such time as though such payment had become due but had not been
made at such time.
Section 5. Subordination. (a) The obligations of Vencor under this
Agreement (the "Second Priority Guarantee Obligations") shall be subordinated in
right of payment, to the extent and in the manner provided in this Section, to
the prior payment by Vencor of its obligations under the Senior Vencor Guaranty
Agreement (the "Senior Guarantee Obligations"). The subordination provisions in
this Section are for the benefit of and enforceable by holders of Senior
Obligations from time to time.
(b) (i) No payment will be made on account of the Second Priority Guarantee
Obligations until the payment in full of all Senior Obligations.
(ii) If any payment or distribution of assets of Vencor is received by
any Lender Party in respect of the Second Priority Guarantee Obligations at
a time when that payment or distribution should not have been made as a
result of clause (i) above, such payment or distribution will be received
and held in trust for and will be paid over to the holders of Senior
Obligations in respect of Senior Guarantee Obligations which are due and
payable and remain unpaid or unprovided for in cash or cash
3
equivalents until all such Senior Guarantee Obligations have been paid in
full or provided for in cash or cash equivalents (as allocated by the
Senior Collateral Agent), after giving effect to any concurrent payment or
distribution or provision therefor to the holders of Senior Obligations.
(c) Upon any payment or distribution of the assets of Vencor to creditors
upon a total or partial liquidation or a total or partial dissolution of Vencor
or in a bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to Vencor or its property:
(i) holders of Senior Obligations are entitled to receive payment in
full in cash of all amounts then due in respect of Senior Guarantee
Obligations, including all interest accrued or accruing on Senior Guarantee
Obligations after the commencement of any bankruptcy, insolvency or
reorganization or similar case or proceeding in respect of either the
Issuer or Vencor at the contract rate (including, without limitation, any
contract rate applicable upon default) specified in the relevant
documentation, whether or not the claim for the interest is allowed as a
claim in the case or proceeding with respect to the Senior Guarantee
Obligations (only such payment constituting "payment in full") before the
Lenders will be entitled to receive any payment on account of the Second
Priority Guarantee Obligations; and
(ii) until the Senior Guarantee Obligations are paid in full, any
payment or distribution to which Lenders would be entitled but for these
subordination provisions shall instead be made to holders of Senior
Obligations as their interests may appear.
(d) If a payment or other distribution is made to Lenders on account of the
Second Priority Guarantee Obligations that because of these subordination
provisions should not have been made to them, the Lenders that receive the
distribution shall hold it in trust to be paid over to holders of Senior
Obligations or their representatives for application to the payment of the
Senior Guarantee Obligations.
(e) A distribution made by Vencor under these subordination provisions to
holders of Senior Obligations which otherwise would have been made to the
Lenders is not, as between Vencor and the Lenders, a payment by Vencor on its
Senior Guarantee Obligations. After all Senior Guarantee Obligations of Vencor
are paid in full, Lenders will be subrogated to the rights of holders of Senior
Guarantee Obligations to receive payments in respect of Senior Guarantee
Obligations, which, to the extent received by Lenders, do not constitute, as
between Vencor and the Lenders, payments by Vencor on its Second Priority
Guarantee Obligations.
4
(f) Subject to the Intercreditor Agreement, these subordination provisions
define the relative rights of Lenders and holders of Senior Obligations and do
not impair, as between Vencor and Lenders, the obligation of Vencor, which is
absolute and unconditional, to pay to the Lenders the Second Priority Guarantee
Obligations in accordance with their terms. The failure to make a payment
pursuant to the Second Priority Guarantee Obligations by reason of these
subordination provisions does not prevent the occurrence of a Default, nor do
these subordination provisions have any effect on the right of the Lenders or
the Administrative Agent to accelerate the maturity of the Notes upon an Event
of Default or prevent the Administrative Agent or any Lender from exercising its
available remedies upon a Default, subject to the rights of holders of Senior
Obligations, if any, to receive distributions otherwise payable to Lenders under
this Section and under the Intercreditor Agreement.
(g) No right of any holder of Senior Obligations to enforce the
subordination as provided herein will be impaired by any act or failure to act
by Vencor or by its failure to comply with this Agreement.
Section 6. Waiver. Vencor irrevocably waives acceptance hereof,
presentment, demand, protest and any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against the
Issuer or any other Person or against any security.
Section 7. Subrogation. When Vencor makes any payment hereunder with
respect to the obligations of the Issuer, Vencor shall be subrogated to the
rights of the payee against the Issuer with respect to the portion of such
obligations paid by Vencor; provided that Vencor shall not enforce any payment
by way of subrogation against the Issuer so long as any amount payable by the
Issuer under any Financing Document remains unpaid.
Section 8. Stay of Acceleration. If acceleration of the time for payment of
any amount payable by the Issuer under any Financing Document is stayed upon the
insolvency, bankruptcy or reorganization of the Issuer, all such amounts
otherwise subject to acceleration under the terms of such Financing Document
shall nonetheless be payable by Vencor hereunder forthwith on demand by the
Administrative Agent made at the request of the Required Lenders.
Section 9. Notices. Notices and other communications hereunder shall be
given in writing in the manner specified in or pursuant to Section 12.01 of the
Credit Agreement.
Section 10. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS GUARANTY
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL
LAWS OF THE STATE OF NEW YORK (INCLUDING
5
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES.
Section 11. Successors and Assigns. This Guaranty Agreement is for the
benefit of holders of Senior Obligations, the Lender Parties and their
respective successors and assigns. If any Loans (as evidenced by the Notes) or
other amounts payable under the Financing Documents are assigned pursuant to
Section 12.06 of the Credit Agreement, the rights hereunder, to the extent
applicable to the indebtedness so assigned, shall be transferred with such
indebtedness.
Section 12. No Waiver. No failure or delay by any Lender Party in
exercising any right, power or privilege under any Financing Document shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided in the Financing
Documents shall be cumulative and not exclusive of any rights or remedies
provided by law.
Section 13. Amendments and Waivers. Any provision of this Guaranty
Agreement may be amended, supplemented, modified or waived as (and only as)
provided in Section 12.05 of the Credit Agreement and the Intercreditor
Agreement.
Section 14. Intercreditor Agreement. Vencor acknowledges and agrees that
notwithstanding anything herein to the contrary, the terms of this Agreement are
subject to the Intercreditor Agreement and subordinated as provided therein.
6
IN WITNESS WHEREOF, Vencor has caused this Guaranty Agreement to be duly
executed by its authorized officer as of the day and year first above written.
VENCOR, INC.
(to be renamed Kindred Healthcare, Inc.)
By:_______________________________________
Name:
Title:
7
EXHIBIT E
SUBORDINATION AND INTERCREDITOR AGREEMENT
dated as of
April 20, 2001
among
VENCOR OPERATING, INC.
(to be renamed Kindred Healthcare Operating, Inc.)
VENCOR, INC.,
(to be renamed Kindred Healthcare, Inc.)
and
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as collateral agent for the Senior Lenders
and
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as collateral agent for the Second Priority Lenders
TABLE OF CONTENTS
___________
Page
----
ARTICLE 1
Definitions
Section 1.01 Incorporation by Reference..................................... 2
Section 1.02 Certain Definitions............................................ 2
ARTICLE 2
Determinations Relating to Collateral; Remedies
Section 2.01 Determinations Relating to Collateral.......................... 7
Section 2.02 Concentration and Collateral Accounts.......................... 7
Section 2.03 Remedies....................................................... 8
Section 2.04 Right to Make Advances......................................... 8
Section 2.05 Nature of Secured Parties' Rights.............................. 9
Section 2.06 Senior Obligation Payment Date................................. 9
ARTICLE 3
Application of Certain Amounts; Mandatory Prepayments
Section 3.01 Application of Proceeds of Collateral after Triggering Event... 9
Section 3.02 Payment Provisions............................................. 10
Section 3.03 Reduction Events; Mandatory Prepayments........................ 11
ARTICLE 4
Subordination
Section 4.01 Perfection and Priority of Security Interests.................. 12
Section 4.02 No Interference; No Right to Instruct Senior Collateral Agent;
Payment Over; Reinstatment; Permitted Actions........................... 17
ARTICLE 5
Amendments of Documents; Limitations On Facility Amounts
Section 5.01 Amendments and Modifications of Second Priority Financing
Documents............................................................... 20
Section 5.02 Limitation on Senior Credit Agreement.......................... 20
Page
----
ARTICLE 6
Release of Collateral; Expiration of Certain Rights
Section 6.01 Releases of Collateral......................................... 21
ARTICLE 7
Miscellaneous
Section 7.01 Amendments, Supplements and Waivers............................ 22
Section 7.02 Notices........................................................ 22
Section 7.03 Headings....................................................... 24
Section 7.04 Severability................................................... 24
Section 7.05 Dealings with the Borrower and the Guarantors.................. 24
Section 7.06 Binding Effect................................................. 24
Section 7.07 Counterparts................................................... 25
Section 7.08 NEW YORK LAW................................................... 25
Section 7.09 CONSENT TO JURISDICTION AND SERVICE OF PROCESS................. 25
Section 7.10 WAIVER OF JURY TRIAL........................................... 25
Section 7.11 Bailee for Perfection.......................................... 26
ii
SUBORDINATION AND INTERCREDITOR AGREEMENT
SUBORDINATION AND INTERCREDITOR AGREEMENT (as amended and modified from
time to time, this "Agreement") dated as of April 20, 2001, among VENCOR
OPERATING, INC. (to be renamed Kindred Healthcare Operating, Inc.), a Delaware
corporation (the "Borrower"), VENCOR, INC. (to be renamed Kindred Healthcare,
Inc.), a Delaware corporation ("Vencor"), XXXXXX GUARANTY TRUST COMPANY OF NEW
YORK, as collateral agent for the Senior Lenders from time to time under the
Senior Financing Documents (in such capacity, together with its successors and
assigns, the "Senior Collateral Agent") and XXXXXX GUARANTY TRUST COMPANY OF NEW
YORK, as collateral agent for the Second Priority Lenders from time to time
under the Second Priority Financing Documents (in such capacity, together with
its successors and assigns, the "Second Priority Collateral Agent").
RECITALS
WHEREAS, the Borrower and Vencor are parties to the Senior Credit Agreement
(such term and other capitalized terms used in these recitals without definition
having the meanings set forth below) pursuant to which the Borrower intends to
borrow funds and obtain letters of credit from the Senior Lenders all on the
terms and conditions set forth therein;
WHEREAS, the Borrower will secure its obligations under the Senior Credit
Agreement, the other Senior Financing Documents and certain specified interest
rate agreements by granting Liens on its assets to the Senior Collateral Agent
on behalf of the Senior Lenders as provided in the Senior Security Agreement and
the other Senior Collateral Documents;
WHEREAS, the Borrower and Vencor are parties to the Second Priority Credit
Agreement pursuant to which the Borrower intends to issue senior secured notes
with a stated principal amount of $300,000,000 to the Second Priority Lenders in
partial satisfaction of the claims of the Second Priority Lenders arising under
the $1,000,000,000 Credit Agreement dated as of April 29, 1998 (as amended, the
"Pre-Petition Senior Credit Agreement") among the Borrower, Vencor and a group
of banks and other financial institutions, in connection with which Bank of
America N.A. (previously named Nationsbank N.A.) acted as administrative agent
and Xxxxxx Guaranty Trust Company of New York acted as documentation agent and
collateral agent;
WHEREAS, the Borrower will secure its obligations under the Second Priority
Credit Agreement and the other Second Priority Financing Documents by granting
second priority Liens on its assets to the Second Priority Collateral Agent
on behalf of the Second Priority Lenders as provided in the Second Priority
Security Agreement and the other Second Priority Collateral Documents;
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
ARTICLE 1
Definitions
Section 1.01. Incorporation by Reference. Capitalized terms used but not
defined herein shall have the meanings assigned to such terms in the Senior
Credit Agreement.
Section 1.02. Certain Definitions. (a) As used in this Agreement, the
capitalized terms defined in the recitals hereto shall have the meanings
specified therein, and the following terms have the meanings specified below:
"Bankruptcy Proceeding" means any proceeding under the Bankruptcy Code or
any other Federal, state or foreign bankruptcy, insolvency, reorganization,
receivership or similar law.
"Collateral" means the Senior Collateral and the Second Priority
Collateral.
"Collateral Accounts" means "Collateral Accounts", as defined in the Senior
Security Agreement or the Second Priority Security Agreement as the context may
require.
"Collateral Documents" means (i) the Senior Collateral Documents and (ii)
the Second Priority Collateral Documents.
"Concentration Accounts" means "Concentration Accounts", as defined in the
Senior Security Agreement or the Second Priority Security Agreement as the
context may require.
"Default Rate" means on any day (i) with respect to any payment to be made
by the Borrower or any Guarantor to any Senior Secured Party on such day, the
"Default Rate", as defined in the Senior Credit Agreement, for such day and (ii)
with respect to any payment to be made by the Borrower or any Guarantor to
2
any Second Priority Secured Party on such day, the "Default Rate", as defined in
the Second Priority Credit Agreement, for such day.
"Distribution Date" means the date on which any funds are distributed by
the Senior Collateral Agent or the Second Priority Collateral Agent in
accordance with the provisions of Section 3.01.
"Event of Default" means any "Event of Default" under any Senior Financing
Document or any "Event of Default" under any Second Priority Financing Document.
"Fees" means, with respect to the Senior Collateral Agent or the Second
Priority Collateral Agent, any fees, expenses, reimbursements or
indemnifications payable by the Borrower or any Guarantor to such Person in such
capacity.
"Financing Documents" means (i) the Senior Financing Documents and (ii) the
Second Priority Financing Documents.
"Instructing Group" means, until the Senior Obligation Payment Date, the
Required Senior Lenders, and thereafter the Required Second Priority Lenders.
"Mortgaged Property" means all property of the Borrower and the Guarantors
subject to any of the Mortgages.
"Reduction Event Account" means "Reduction Event Account", as defined in
the Senior Security Agreement or the Second Priority Security Agreement as the
context may require.
"Representatives" means (i) the Senior Collateral Agent and (ii) the Second
Priority Collateral Agent.
"Required Second Priority Lenders" means the "Required Lenders", as defined
in the Second Priority Credit Agreement.
"Required Senior Lenders" means the "Required Lenders", as defined in the
Senior Credit Agreement.
"Second Priority Collateral" means all the "Collateral" as defined in the
Second Priority Collateral Documents and shall also include the Mortgaged
Property and the proceeds thereof.
"Second Priority Collateral Documents" means the "Collateral Documents", as
defined in the Second Priority Security Agreement.
3
"Second Priority Credit Agreement" means the $300,000,000 Credit Agreement
dated as of April 20, 2001, among the Borrower, Vencor, the financial
institutions party thereto, and Xxxxxx Guaranty Trust Company of New York, as
administrative agent and collateral agent, as the same may be amended, restated,
supplemented or otherwise modified from time to time, together with all
replacements, refinancings, refundings and renewals thereof from time to time.
"Second Priority Enforcement Notice" means any "Enforcement Notice", as
defined in the Second Priority Credit Agreement.
"Second Priority Financing Documents" means the "Financing Documents", as
defined in the Second Priority Credit Agreement.
"Second Priority Guaranty Agreements" means the "Guaranty Agreements", as
defined in the Second Priority Credit Agreement.
"Second Priority Lenders" means the "Lenders", as defined in the Second
Priority Credit Agreement.
"Second Priority Lien" means the Liens on the Second Priority Collateral in
favor of the Second Priority Secured Parties under the Second Priority
Collateral Documents.
"Second Priority Mortgages" means the "Mortgages", as defined in the Second
Priority Credit Agreement.
"Second Priority Obligations" means the "Secured Obligations", as defined
in the Second Priority Security Agreement.
"Second Priority Secured Party" means each holder from time to time of the
Second Priority Obligations.
"Second Priority Security Agreement" means the "Security Agreement", as
defined in the Second Priority Credit Agreement.
"Second Priority Subsidiary Guaranty Agreement" means the "Subsidiary
Guaranty Agreement", as defined in the Second Priority Credit Agreement.
"Second Priority Vencor Guaranty Agreement" means the "Vencor Guaranty
Agreement", as defined in the Second Priority Credit Agreement.
4
"Secured Obligations" means, without duplication, (i) the Senior
Obligations and (ii) the Second Priority Obligations.
"Secured Parties" means (i) the Senior Secured Parties and (ii) the Second
Priority Secured Parties.
"Senior Collateral" means all the "Collateral" as defined in the Senior
Collateral Documents and shall also include the Mortgaged Property and the
proceeds thereof.
"Senior Collateral Documents" means the "Collateral Documents", as defined
in the Senior Security Agreement.
"Senior Credit Agreement" means the $120,000,000 Credit Agreement dated as
of April 20, 2001, among the Borrower, Vencor, the financial institutions party
thereto, Xxxxxx Guaranty Trust Company of New York, as administrative agent and
collateral agent, and General Electric Capital Corporation, as documentation
agent and collateral monitoring agent, as the same may be amended, restated,
supplemented or otherwise modified from time to time, together with all
replacements, refinancings, refundings and renewals thereof from time to time.
"Senior Enforcement Notice" means any "Enforcement Notice", as defined in
the Senior Credit Agreement.
"Senior Financing Documents" means the "Financing Documents", as defined in
the Senior Credit Agreement.
"Senior Lenders" means the "Lenders", as defined in the Senior Credit
Agreement.
"Senior Lien" means the Liens on the Senior Collateral in favor of the
Senior Secured Parties under the Senior Collateral Documents.
"Senior Mortgages" means the "Mortgages", as defined in the Senior Credit
Agreement.
"Senior Obligation Payment Date" means the date on which (i) the Senior
Obligations have indefeasibly been paid in full in cash or cash equivalents,
(ii) all lending commitments under the Senior Credit Agreement have been
terminated and (iii) there are no outstanding Letters of Credit issued under the
Senior Credit Agreement other than such as have been fully cash collateralized
5
under documents and arrangements satisfactory to the issuer of such letters of
credit.
"Senior Obligations" means the "Secured Obligations", as defined in the
Senior Security Agreement; provided that the principal amount of the
indebtedness under the Senior Credit Agreement included in the Senior
Obligations shall not exceed the maximum amount from time to time permitted to
be outstanding by this Agreement.
"Senior Secured Party" means each holder from time to time of the Senior
Obligations.
"Senior Security Agreement" means the "Security Agreement", as defined in
the Senior Credit Agreement.
"Triggering Event" means (x) the occurrence of any Event of Default and, as
a result thereof, (A) the acceleration (including any automatic acceleration in
connection with any Bankruptcy Proceeding) of the principal amount of any Senior
Obligations or Second Priority Obligations under the terms of any Financing
Document, (B) the receipt by the Senior Collateral Agent of a Senior Enforcement
Notice or of written instructions given by the Required Senior Lenders while a
Senior Enforcement Notice is in effect, in either case, directing the Senior
Collateral Agent to exercise one or more specific rights or remedies under the
Senior Collateral Documents or (C) the receipt by the Second Priority Collateral
Agent of a Second Priority Enforcement Notice or of written instructions given
by the Required Second Priority Lenders while a Second Priority Enforcement
Notice is in effect, in either case, directing the Second Priority Collateral
Agent to exercise one or more specific rights or remedies under the Second
Priority Collateral Documents and (y) in any such case, receipt by the Second
Priority Collateral Agent of written notice thereof from the Senior Collateral
Agent (in the case of any such Event of Default arising under the Senior
Financing Documents) or receipt by the Senior Collateral Agent of written notice
thereof from the Second Priority Collateral Agent (in the case of any such Event
of Default arising under any Second Priority Financing Document).
(b) References in this Agreement to "Articles", "Sections", "Schedules" or
"Exhibits" are to Articles, Sections, Schedules or Exhibits of or to this
Agreement unless otherwise specifically provided. Any of the terms defined in
Section 1.02 may, unless the context otherwise requires, be used in the singular
or plural depending on the reference. "Include", "includes" and "including" are
deemed to be followed by "without limitation" whether or not they are in fact
followed by such words or words of like import. "Writing", "written" and
comparable terms refer to printing, typing, facsimile and other
6
means of reproducing words on paper. References to any agreement or contract are
to such agreement or contract as amended, modified or supplemented from time to
time (whether before, on or after the Closing Date) in accordance with the terms
hereof and thereof. "Hereto", "herein" and "hereof" refer to this Agreement as
amended from time to time. "Any of the Mortgaged Property" means "the Mortgaged
Property or any part thereof or interest therein".
ARTICLE 2
Determinations Relating to Collateral; Remedies
Section 2.01. Determinations Relating to Collateral. If (i) the Second
Priority Collateral Agent shall receive any written request from the Borrower or
any Guarantor under any Second Priority Collateral Document for consent or
approval with respect to any matter or thing relating to any Collateral or the
Borrower or any Guarantor's obligations with respect thereto or (ii) there shall
be due to or from the Second Priority Collateral Agent under the provisions of
any Second Priority Collateral Document any material performance or the delivery
of any material instrument or (iii) the Second Priority Collateral Agent shall
become aware of any nonperformance by the Borrower or any Guarantor of any
covenant or any breach of any representation or warranty set forth in any Second
Priority Financing Document, then, in each such event, the Second Priority
Collateral Agent shall promptly advise the Senior Collateral Agent of the matter
or thing as to which consent has been requested or the performance or instrument
required to be delivered or the nonperformance or breach of which the Second
Priority Collateral Agent has become aware. Until the occurrence of the Senior
Obligation Payment Date, and subject to Section 6.01, the Senior Collateral
Agent and the Required Senior Lenders shall have the exclusive authority to
direct the Second Priority Collateral Agent's response to any of the events or
circumstances contemplated in clauses (i), (ii) and (iii) above.
Section 2.02. Concentration and Collateral Accounts. Until the occurrence
of the Senior Obligation Payment Date, all Concentration Accounts and Collateral
Accounts shall be established and maintained and all amounts therein shall be
applied in accordance with the provisions of the Senior Financing Documents and
this Agreement; provided that (x) the Second Priority Collateral Agent, on
behalf of the Second Priority Lenders, shall have a second priority security
interest in such accounts and in all Temporary Cash Investments standing to the
credit thereof as set forth in the Second Priority Security Agreement and (y)
the Senior Collateral Agent shall release or arrange for the release of amounts
from such accounts from time to time to enable the Borrower or the Second
Priority Collateral Agent to make timely payments of amounts as and when they
7
fall due for payment under the Second Priority Financing Documents but only if
the payment of such amounts is then not prohibited by any provision hereof or of
the Senior Financing Documents. Following the occurrence of the Senior
Obligation Payment Date, all amounts in the Concentration Accounts and the
Collateral Accounts established under the Senior Security Agreement shall be
transferred to Concentration Accounts and Collateral Accounts established in
accordance with the provisions of the Second Priority Security Agreement and
such accounts shall thereafter be maintained and all amounts therein shall be
applied in accordance with the provisions of the Second Priority Security
Agreement.
Section 2.03. Remedies. (a) Until the Senior Obligation Payment Date, the
Senior Collateral Agent and the Required Senior Lenders shall have the exclusive
right to exercise any right or remedy with respect to the Collateral and shall
have the exclusive right to determine and direct the time, method and place for
exercising such right or remedy or conducting any proceeding with respect
thereto. Following the Senior Obligation Payment Date, the Second Priority
Collateral Agent and the Required Second Priority Lenders shall have the
exclusive right to exercise any right or remedy with respect to the Collateral,
and the Required Second Priority Lenders shall have the exclusive right to
direct the time, method and place of exercising or conducting any proceeding for
the exercise of any right or remedy available to the Second Priority Collateral
Agent with respect to the Collateral, or of exercising any power conferred on
the Second Priority Collateral Agent, or for the taking of any other action
authorized by the Second Priority Collateral Documents; provided, however, that
nothing in this Section shall impair the right of the Second Priority Collateral
Agent in its discretion to take any action deemed proper by the Second Priority
Collateral Agent and which is not inconsistent with the terms hereof or any such
direction by the Required Second Priority Lenders.
(b) The Senior Collateral Agent will give the Second Priority Collateral
Agent prompt written notice of the occurrence of the Senior Obligation Payment
Date.
Section 2.04. Right to Make Advances. If an advance of funds shall at any
time be required for the preservation or maintenance of any Collateral, the
Senior Collateral Agent or the Second Priority Collateral Agent shall be
entitled to make such advance after notice to the Borrower and the other
Representative of its intention to do so but without notice to any other Secured
Party; provided that the Second Priority Collateral Agent shall not be entitled
to make any such advance unless (a) it shall have given at least two days' prior
notice to the Senior Collateral Agent of its intention to do so and (b) the
Senior Collateral Agent shall not have objected during such two day period to
the Second Priority Collateral Agent
8
making such advance (such objection, if any, to be received by the Second
Priority Collateral Agent during such two day period). Each such advance shall
be reimbursed, with interest accrued from the date such advance was made at the
Default Rate, by the Borrower upon demand by the Senior Collateral Agent or the
Second Priority Collateral Agent, and if the Borrower fails to comply with any
such demand, out of the proceeds of any Collateral in accordance with the
provisions of Section 3.01. If any Secured Party shall receive any funds which,
under this Section 2.04, belong to the Senior Collateral Agent or the Second
Priority Collateral Agent, such Secured Party shall remit such funds promptly to
the Senior Collateral Agent or the Second Priority Collateral Agent for
distribution to itself, and before such remittance shall hold such funds in
trust for the Senior Collateral Agent or the Second Priority Collateral Agent,
as the case may be.
Section 2.05. Nature of Secured Parties' Rights. All of the Secured Parties
shall be bound by any instruction or direction given by the Instructing Group
pursuant to this Agreement.
Section 2.06. Senior Obligation Payment Date. Promptly upon the occurrence
of the Senior Obligation Payment Date, the Senior Collateral Agent shall notify
the Second Priority Collateral Agent and any insurer that has issued a lender's
title insurance policy with respect to the Mortgaged Properties of the
occurrence thereof.
ARTICLE 3
Application of Certain Amounts; Mandatory Prepayments
Section 3.01. Application of Proceeds of Collateral after Triggering Event.
If, following a Triggering Event, any Collateral is sold or otherwise realized
upon (whether pursuant to the exercise of any remedy set forth in any Collateral
Document, in a Bankruptcy Proceeding or otherwise), the proceeds in respect of
such Collateral shall be applied as soon as practicable after receipt as
follows:
FIRST: to the Senior Collateral Agent in an amount equal to the Fees
thereof which are unpaid as of the applicable Distribution Date, to
any Senior Secured Party which has theretofore advanced or paid any
such Fees in an amount equal to the amount thereof so advanced or paid
by such Senior Secured Party, pro rata based on the amounts of such
Fees (or such advance or payment) and, without duplication, to the
Senior Collateral Agent towards the
9
payment of any other costs, expenses or amounts payable pursuant to
clause first of Section 15(b) of the Senior Security Agreement based
on the amounts payable thereunder;
SECOND: to the Senior Collateral Agent and the Second Priority
Collateral Agent to reimburse to the Senior Collateral Agent and the
Second Priority Collateral Agent for the amount of any advance made
pursuant to Section 2.04 hereof (with interest thereon at the Default
Rate), pro rata based on the amounts so advanced;
THIRD: until the Senior Obligation Payment Date, to the Senior
Collateral Agent, for distribution to the Senior Secured Parties to be
applied to the payment of the Senior Obligations in accordance with
clauses second, third and fourth of Section 15(b) of the Senior
Security Agreement;
FOURTH: to the Second Priority Collateral Agent in an amount equal to
the Fees thereof which are unpaid as of the applicable Distribution
Date, to any Second Priority Secured Party which has theretofore
advanced or paid any such Fees in an amount equal to the amount
thereof so advanced or paid by such Second Priority Secured Party, pro
rata based on the amounts of such Fees (or such advance or payment)
and, without duplication, to the Second Priority Collateral Agent
towards the payment of any other costs, expenses or amounts payable
pursuant to clause first of Section 15(b) of the Second Priority
Security Agreement based on the amounts payable thereunder;
FIFTH: to the Second Priority Collateral Agent, for distribution to
the Second Priority Secured Parties to be applied to the payment of
the Second Priority Obligations in accordance with clauses second,
third and fourth of Section 15(b) of the Second Priority Security
Agreement, until all the Second Priority Obligations have been paid in
full; and
SIXTH: after payment in full of all Secured Obligations, to the
Borrower and the Guarantors or their successors or assigns, as their
interests may appear, or to whosoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct.
Section 3.02. Payment Provisions. For the purposes of applying the
provisions of Section 3.01, all interest, fees and other amounts to be paid on
any of the Secured Obligations pursuant to the terms of any Financing Document
10
shall, as among the Secured Parties and regardless of whether any such interest,
fees or other amounts are or would be recognized or allowed as a claim in any
bankruptcy or similar proceeding, be treated as due and owing on the Secured
Obligations.
Section 3.03. Reduction Events; Mandatory Prepayments. (a) Until the
occurrence of the Senior Obligation Payment Date but prior to the occurrence of
a Triggering Event, if any Net Cash Proceeds of any Asset Sale (other than in
connection with the Kingfish Transaction) of the Borrower or any Restricted
Subsidiary or if any Casualty Proceeds with respect to property of the Borrower
or any Restricted Subsidiary are to be deposited into a Collateral Account
pursuant to Section 2.11(a) of the Senior Credit Agreement or Section 2.06(a) of
the Second Priority Credit Agreement, such Net Cash Proceeds or Casualty
Proceeds, as the case may be, shall be applied: first as set forth in Section
7(b) and (c) of the Senior Security Agreement and, without duplication, second
as set forth in Section 7(c) of the Second Priority Security Agreement.
Following the occurrence of the Senior Obligation Payment Date but prior to the
occurrence of a Triggering Event, such Net Cash Proceeds or Casualty Proceeds,
as the case may be, shall be applied as set forth in Section 7(b) and (c) of the
Second Priority Security Agreement.
(b) If on any date on or after the Closing Date but prior to the
occurrence of the Senior Obligation Payment Date or a Triggering Event, Vencor
receives any Net Cash Proceeds from any Equity Issuance, such Net Cash Proceeds
(or the applicable portion thereof) shall be applied: first as set forth in
Section 2.11(b) of the Senior Credit Agreement and, without duplication, second
as set forth in Section 2.06(b) of the Second Priority Credit Agreement.
Following the occurrence of the Senior Obligation Payment Date, such Net Cash
Proceeds shall be applied as set forth in Section 2.06(b) of the Second Priority
Credit Agreement.
(c) If on any date on or after the Closing Date but prior to the
occurrence of the Senior Obligation Payment Date or a Triggering Event, Vencor
receives a cash payment out of the original amount deposited and held in escrow
under the Tax Refund Escrow Agreement, such payment shall be applied: first as
set forth in Section 2.11(c) of the Senior Credit Agreement and, without
duplication, second as set forth in Section 2.06(c) of the Second Priority
Credit Agreement. Following the occurrence of the Senior Obligation Payment
Date, such cash payment shall be applied as set forth in Section 2.06(c) of the
Second Priority Credit Agreement.
(d) Each prepayment of loans required pursuant to the foregoing provisions
of this Section will be made together with accrued interest to the date of
prepayment and any applicable premium in accordance with the terms of the
applicable Financing Document but such interest and premium, if any, shall not
11
reduce the amount of principal required to be prepaid in accordance with this
Section.
(e) In the event the Borrower or any Restricted Subsidiary shall, at any
time after the occurrence of a Triggering Event, receive any Net Cash Proceeds
of any Asset Sale or any Casualty Proceeds which are attributable to Collateral,
such Net Cash Proceeds shall be subject to and applied in accordance with the
provisions of Section 3.01.
(f) Notwithstanding the foregoing, any payment made or to be made by any
Guarantor in respect of Second Priority Obligations subsequent to the occurrence
of a Triggering Event other than from the proceeds of Collateral shall be
subject to, and only made in accordance with, the subordination provisions of
the Second Priority Guaranty Agreements.
(g) For avoidance of doubt, paragraphs (a), (b) and (c) of Section 3.01 do
not themselves create any Liens nor do they alter the priorities of Liens which
are created by the Financing Documents.
ARTICLE 4
Subordination
Section 4.01. Perfection and Priority of Security Interests. (a) Any and
all security interests, assignments, pledges, mortgages, deeds of trust, deeds
to secure debt and other liens, charges or encumbrances now existing or
hereafter created or arising of the Borrower or any Guarantor in favor of the
Second Priority Collateral Agent for the benefit of the Second Priority Secured
Parties with respect to the Collateral and securing the Second Priority
Obligations are expressly junior in priority, operation and effect to any and
all security interests, assignments, pledges, mortgages, deeds of trusts, deeds
to secure debt and other liens, charges or encumbrances now existing or
hereafter created or arising in favor of the Senior Collateral Agent for the
benefit of the Senior Secured Parties with respect to the Collateral and
securing the Senior Obligations, notwithstanding anything to the contrary
contained in any agreement or filing to which the Second Priority Collateral
Agent or any Second Priority Secured Party may now or hereafter be a party, and
regardless of the time, order or method of attachment, recording or perfection
of any financing statements or other security interests, assignments, pledges,
mortgages and other liens, charges or encumbrances or any defect or deficiency
or alleged defect or deficiency in any of the foregoing.
12
(b) The Second Priority Collateral Agent, on behalf of itself the other
Second Priority Secured Parties, acknowledges that the Senior Obligations
represent obligations under certain interest rate agreements and debt that is
revolving in nature and that the amount thereof that may be outstanding at any
time or from time to time may be increased or reduced and subsequently
reborrowed, and that the terms of the Senior Obligations may be modified,
extended or amended from time to time, and the aggregate amount of the Senior
Obligations may be increased, replaced or refinanced, all in accordance with
Section 5.02 hereof but otherwise without notice to or consent by the Second
Priority Secured Parties and without affecting the provisions hereof. The lien
priorities provided in this Section 4.01 shall not be altered or otherwise
affected by any such amendment, modification, supplement, extension, repayment,
reborrowing, increase, replacement, renewal, restatement or refinancing of
either the Senior Obligations or the Second Priority Obligations, or any portion
thereof, nor by any action that the Senior Secured Parties or the Second
Priority Secured Parties may take or fail to take in respect of the Collateral
in accordance with this Agreement.
(c) For purposes of perfecting the Second Priority Lien in the Collateral
and the proceeds thereof, the Borrower and Vencor, on behalf of themselves and
the Subsidiary Guarantors, and the Senior Collateral Agent hereby acknowledge
that UCC-1 financing statements, patent/trademark/copyright filings and
mortgages or other filings or recordings covering the Collateral, naming the
Borrower and one or more Guarantors as debtor, and the Second Priority
Collateral Agent, on behalf of the Second Priority Secured Parties, as secured
party, may be filed in appropriate public offices from time to time.
(i) The Second Priority Collateral Agent and each Second Priority
Secured Party agrees that all UCC-1 financing statements,
patent/trademark/copyright filings (except as provided in clause (ii)
below) or other filings or recordings filed or recorded by or on behalf of
the Second Priority Secured Parties shall be in form satisfactory to the
Senior Collateral Agent and shall contain the following notation (or other
notation substantially similar thereto): "The interest of the Secured Party
in the collateral described herein is junior and subordinate to the
interests of Xxxxxx Guaranty Trust Company of New York, and its successors
and assigns, as collateral agent for certain secured parties, including the
lenders from time to time party to that certain $120,000,000 Credit
Agreement dated as of April 20, 2001, as amended, restated, supplemented,
modified, refinanced or replaced from time to time, with Vencor Operating
Inc. (to be renamed Kindred Healthcare Operating, Inc.) and Vencor, Inc.
(to be renamed Kindred Healthcare, Inc.) in accordance with the provisions
of that certain Subordination and Intercreditor
13
Agreement dated as of April 20, 2001, among Vencor Operating Inc. (to be
renamed Kindred Healthcare Operating, Inc.) and Vencor, Inc. (to be renamed
Kindred Healthcare, Inc.), and Xxxxxx Guaranty Trust Company of New York,
as Second Priority Collateral Agent and as Senior Collateral Agent, as
amended from time to time."
(ii) In addition, the Second Priority Collateral Agent and each
Second Priority Secured Party agrees that all mortgages, deeds of trust,
deeds to secure debt and similar instruments (collectively, "mortgages")
now or hereafter filed against real and/or personal property pursuant to
any Second Priority Collateral Document in favor of or for the benefit of
the Second Priority Collateral Agent and/or the Second Priority Secured
Parties shall be in form satisfactory to the Senior Collateral Agent and
shall contain the following provision (or other provision substantially
similar thereto): "Notwithstanding any provision to the contrary herein,
the terms of this [Mortgage], the Liens created hereby, and the rights and
remedies of the Mortgagee and the Secured Parties hereunder, are subject to
the Intercreditor Agreement and subordinated as provided therein."
(d) The Second Priority Collateral Agent, on behalf of itself and the
other Second Priority Secured Parties, hereby agrees:
(i) to subordinate the Second Priority Collateral Documents to any
lease of any of the Mortgaged Properties to the same extent that the Senior
Collateral Documents are or have been subordinated to such lease, but
without affecting the relative priority of the Senior Collateral Documents
and the Second Priority Collateral Documents,
(ii) to grant nondisturbance rights with respect to any lease of any
of the Mortgaged Properties with respect to which the Senior Collateral
Agent has granted nondisturbance on substantially the same terms as granted
by the Senior Collateral Agent,
(iii) that if all or any portion of a Mortgaged Property is a
leasehold interest, (A) upon termination of any lease creating such
leasehold interest (the "Original Lease"), any right of the Second Priority
Collateral Agent to request a "new lease" pursuant to the terms of the
Original Lease shall be junior and subordinate to the right of the Senior
Collateral Agent to request such a new lease and the Second Priority
Collateral Agent shall not exercise any such right without the prior
written consent of the Senior Collateral Agent, (B) the Second Priority
Collateral Agent shall waive, surrender and give up any right either the
Second Priority Collateral Agent or the Second Priority Secured Parties may
have
14
to redeem the premises demised by the Original Lease or to continue the
Original Lease for its original term after the lessee thereunder has been
dispossessed or ejected therefrom by process of law or otherwise and (C)
the Senior Lien and the Second Priority Lien shall remain in force or be
reinstated with the same relative priority that existed with respect to the
Original Lease, and
(iv) that if the holder or grantor of a Second Priority Collateral
Document pays or discharges any liens prior in right to the lien created by
the Senior Collateral Documents with funds provided by the Second Priority
Collateral Agent or any Second Priority Secured Party, neither the Second
Priority Collateral Agent nor any Second Priority Secured Party shall
acquire, by subrogation or otherwise, any claim superior or equivalent to
the lien of the Senior Collateral Documents so long as any indebtedness
secured by the Senior Collateral Documents remains outstanding.
Notwithstanding anything to the contrary in the Senior Mortgages, the
Senior Collateral Agent and the Senior Secured Parties hereby consent to the
assignment of leases and rents to the Second Priority Collateral Agent for the
Second Priority Secured Parties contained in the Second Priority Mortgages for
the purpose of securing and discharging the performance by the Borrower and the
Guarantors party thereto, provided however, that such assignment is subject to
the terms of this Agreement. The Senior Collateral Agent and the Senior Secured
Parties agree that the terms of each Senior Mortgage and the rights and remedies
of the parties thereto are subject to this Agreement. The Second Priority
Collateral Agent and the Second Priority Secured Parties agree that the terms of
each Second Priority Mortgage and the rights and remedies of the parties thereto
are subject to this Agreement and subordinated as provided herein.
(e) The Second Priority Collateral Agent, on behalf of itself and the
other Second Priority Secured Parties, acknowledges and agrees with the Senior
Collateral Agent and the Senior Secured Parties that the arrangements described
in clauses (a), (b), (c) and (d) above are solely for the purpose of providing
the Second Priority Secured Parties with a perfected second priority Lien in the
Collateral under the Second Priority Collateral Documents and shall in no way be
construed as imposing any duties or other obligations on the Senior Collateral
Agent other than to transfer to the Second Priority Collateral Agent in
accordance with the Financing Documents (or as a court of competent jurisdiction
may otherwise direct) the proceeds, if any, that remain following a sale,
transfer or other disposition of the Collateral and the occurrence of the Senior
Obligation Payment Date or, if the Senior Collateral Agent shall still be in
possession of all or any part of such Collateral after the Senior Obligation
Payment Date, such
15
Collateral or such part thereof remaining, without representation or warranty on
the part of the Senior Collateral Agent or the Senior Secured Parties.
In furtherance of the foregoing, the Second Priority Collateral Agent and
the Second Priority Secured Parties acknowledge and agree with the Senior
Secured Parties that, at all times following a Triggering Event until the Senior
Obligation Payment Date, the Senior Collateral Agent shall have the right to
sell, transfer or otherwise dispose of or deal with the Collateral as provided
in the Senior Collateral Documents without regard to the security interest of
the Second Priority Secured Parties therein, or any rights to which the Second
Priority Secured Parties would otherwise be entitled as a result of such
security interest, the only obligation of the Senior Collateral Agent to the
Second Priority Secured Parties in respect thereof being to deliver to the
Second Priority Collateral Agent (unless otherwise directed in writing by the
Second Priority Collateral Agent or by a court of competent jurisdiction) any
proceeds remaining from such sale, transfer or other disposition of such
Collateral after the Senior Obligation Payment Date or, if the Senior Collateral
Agent shall still be in possession of all or any part of such Collateral after
such payment and satisfaction in full, such Collateral or such part thereof
remaining, without representation or warranty on the part of the Senior
Collateral Agent or the Senior Secured Parties, provided that nothing contained
in this sentence shall be construed to give rise to, nor shall the Second
Priority Collateral Agent or the Second Priority Secured Parties have, any
claims whatsoever against the Senior Collateral Agent or any Senior Secured
Party on account of any act or omission to act in connection with the exercise
of any right or remedy of the Senior Collateral Agent with respect to the
Collateral that is permitted by the Collateral Documents (other than with
respect to any claims that may arise as a result of the failure of the Senior
Collateral Agent, after the Senior Obligation Payment Date, to deliver any such
remaining Collateral or proceeds to the Second Priority Collateral Agent). The
Second Priority Collateral Agent, on behalf of itself and the other Second
Priority Secured Parties, agrees that it shall not, and shall not attempt to,
exercise any rights with respect to (A) the Senior Lien in the Collateral or (B)
the Second Priority Lien in the Collateral, whether pursuant to the Second
Priority Collateral Documents or otherwise, until the Senior Obligation Payment
Date; provided that nothing in this sentence (or elsewhere in the Agreement)
shall preclude (x) exercise of the rights expressly reserved to the Second
Priority Collateral Agent and the Second Priority Secured Parties in accordance
with the terms of this Agreement or (y) the enforcement of this Agreement.
(f) In any Bankruptcy Proceeding, until the Senior Obligation Payment
Date, the Second Priority Collateral Agent, on behalf of itself and the other
Second Priority Secured Parties, agrees not to take any action whatsoever
(including, without limitation, voting any claim) in respect of or relating to
the
16
Second Priority Obligations, insofar as any such action arises from or relates
to the Second Priority Collateral Documents, the Second Priority Lien or relates
to the Collateral, in any manner that is inconsistent with or adverse to the
rights and priorities of the Senior Secured Parties as set forth herein.
(g) In the event that in any Bankruptcy Proceeding, the Second Priority
Secured Parties shall not have filed a proof of claim in respect of any Second
Priority Obligation by the date ten days prior to the latest date on which such
proof of claim may be filed, the Senior Collateral Agent is hereby authorized
but not obligated, on behalf of any applicable Second Priority Secured Party, to
file such proof of claim; provided that the Second Priority Secured Parties
shall be entitled to amend, vote or otherwise exercise rights in respect of any
such proof of claim so filed by the Senior Collateral Agent to the same extent
as they would be permitted under this Agreement to do so had such proof of claim
been filed by them.
Section 4.02. No Interference; No Right to Instruct Senior Collateral
Agent; Payment Over; Reinstatment; Permitted Actions. (a) The Second Priority
Collateral Agent, on behalf of itself and the other Second Priority Secured
Parties, agrees that:
(i) it will not take or cause to be taken any action, the purpose
or effect of which is to make any Second Priority Lien pari passu with, or
to give any Second Priority Secured Party any preference or priority
relative to, the Senior Lien or the Senior Secured Parties with respect to
the Collateral or any part thereof,
(ii) it will not interfere with, hinder or delay, in any manner,
whether by judicial proceedings or otherwise, any sale, transfer or other
disposition of the Collateral by the Senior Collateral Agent or any other
Senior Secured Party or any other action taken by or on behalf of the
Senior Collateral Agent or any Senior Secured Party permitted to be taken
by it pursuant to the Senior Collateral Documents,
(iii) it has no right to (A) direct the Senior Collateral Agent or
any other Senior Secured Party to exercise any right, remedy or power with
respect to the Collateral or pursuant to the Senior Collateral Documents or
(B) consent to the exercise by the Senior Collateral Agent or any other
Senior Secured Party of any right, remedy or power with respect to the
Collateral or pursuant to the Senior Collateral Documents,
(iv) it will not institute or assert in any suit, Bankruptcy
Proceeding or other proceeding any claim against the Senior Collateral
17
Agent or any other Senior Secured Party seeking damages from or other
relief by way of specific performance, instructions or otherwise, with
respect to, and none of the Senior Collateral Agent nor any other Senior
Secured Party shall be liable for, any action taken or omitted to be taken
by the Senior Collateral Agent or the Senior Secured Parties with respect
to the Collateral or pursuant to the Senior Collateral Documents,
(v) until the Senior Obligation Payment Date, it will not make any
judicial or nonjudicial claim or demand or commence any judicial or non-
judicial proceedings against the Borrower or any Guarantor under or with
respect to any Collateral Document seeking payment or damages from or other
relief by way of specific performance, instructions or otherwise under or
with respect to any Collateral Document (other than filing a proof of
claim) or exercise any right, remedy or power under or with respect to, or
otherwise take any action to enforce, other than filing a proof of claim,
any Collateral Document; provided, however, that (A) if there is a
Bankruptcy Proceeding with respect to the Borrower, the Second Priority
Collateral Agent or any Second Priority Secured Party may make claims under
and seek to enforce any Second Priority Guaranty Agreement, subject to the
subordination provisions thereof and to the other provisions of this
Agreement and (B) none of the Second Priority Collateral Agent or any other
Second Priority Secured Party may exercise any right, remedy or power under
or with respect to any other Second Priority Collateral Document, or
otherwise take any action to enforce rights or remedies with respect to any
Collateral,
(vi) until the Senior Obligation Payment Date, it will not commence
judicial or nonjudicial foreclosure proceedings with respect to, seek to
have a trustee, receiver, liquidator or similar official appointed for or
over, attempt any action to take possession of any Collateral, exercise any
right, remedy or power with respect to, or otherwise take any action to
enforce its interest in or realize upon, the Collateral or pursuant to the
Second Priority Collateral Documents; provided that nothing in this
paragraph (or elsewhere in this Agreement) shall restrict the right of the
Second Priority Collateral Agent or any other Second Priority Secured Party
to request "adequate protection" (within the meaning of Section 361 of the
Bankruptcy Code) for the interests of the Second Priority Secured Parties
in the Second Priority Collateral in the event of any Bankruptcy Proceeding
on a basis that is not inconsistent with the rights and priorities of the
Senior Secured Parties as set forth herein and in the Financing Documents,
18
(vii) it will not seek, and hereby waives any right, to have the
Collateral or any part thereof marshaled upon any foreclosure or other
disposition of the Collateral, and
(viii) it will not attempt, directly or indirectly, whether by
judicial proceedings or otherwise, to challenge the enforceability of any
provision of this Agreement or any Senior Financing Document or the
validity, perfection, priority or enforceability of the Senior Lien.
(b) The Second Priority Collateral Agent, on behalf of itself and the
other Second Priority Secured Parties, hereby agrees that, in the event of a
sale, transfer or other disposition of Collateral following a Triggering Event,
any security interest or lien of the Second Priority Secured Parties in such
Collateral (but not the proceeds thereof to the extent that such proceeds are to
be applied to Second Priority Obligations pursuant to Section 3.01) shall
terminate and be released automatically and without further action if the Senior
Lien in such Collateral is released. The Second Priority Collateral Agent will
execute and deliver to the Senior Collateral Agent promptly upon request
therefor all necessary instruments and documents to evidence such termination
and release.
(c) Except with respect to proceeds of any sale or other realization on
Collateral (i) payable prior to the occurrence of a Triggering Event to the
Second Priority Collateral Agent for the benefit of the Second Priority Secured
Parties pursuant to Section 3.03 or (ii) received by the Second Priority
Collateral Agent pursuant to distributions made by the Senior Collateral Agent
after the occurrence of a Triggering Event under Section 3.01, the Second
Priority Collateral Agent, on behalf of itself and the other Second Priority
Secured Parties, hereby agrees that if it shall obtain possession of any of the
Collateral, or shall realize any payment of insurance (including any payment on
any lender's title insurance policy with respect to the Mortgaged Properties) or
condemnation proceeds, proceeds of any sale or other disposition, rents, profits
or other income, reserve or compensation of any kind in respect of the
Collateral, in any case before the Senior Obligation Payment Date, then it shall
hold such Collateral or payment in trust for the Senior Secured Parties and
transfer such Collateral or payment, as the case may be, to the Senior
Collateral Agent for application in accordance with the provisions of Section
3.01. If, at any time, all or part of any payment with respect to the Senior
Obligations previously made is rescinded for any reason whatsoever, (i) the
Second Priority Collateral Agent and the Second Priority Secured Parties shall
promptly pay over to the Senior Collateral Agent any payment received by any of
them after the occurrence of a Triggering Event in respect of the Collateral or
proceeds thereof, and shall promptly turn any Collateral then held by any of
them over to the Senior Collateral Agent, in each case to the extent that the
Second Priority Secured Parties would not have been entitled to receive or hold
such
19
payment or Collateral pursuant to the terms of this Agreement had the rescinded
payment in respect of the Senior Obligations never been made in the first
instance and (ii) the provisions set forth in this Agreement shall be reinstated
as if such rescinded payment had not been made, until the Senior Obligation
Payment Date; provided, however, that the foregoing shall not require the Second
Priority Secured Parties to pay over to the Senior Collateral Agent any payment
received by them or Collateral delivered to them if such payment or delivery is
itself rescinded for any reason (and any such payment or Collateral theretofore
paid over to the Senior Secured Parties pursuant to the foregoing provisions
shall be released and delivered to the appropriate Person to the extent
necessary to effect such rescission.)
(d) With respect to proceeds of any sale or other realization on
Collateral to the extent payable to the Second Priority Collateral Agent for the
benefit of the Second Priority Secured Parties pursuant to Section 3.01, the
Senior Collateral Agent, on behalf of itself and the other Senior Secured
Parties, hereby agrees that if any of them shall obtain possession of any of
such proceeds before the time when the Second Priority Obligations have been
paid in full, then it shall hold such proceeds in trust for the holders of the
Second Priority Obligations and transfer such proceeds to the Second Priority
Collateral Agent.
ARTICLE 5
Amendments of Documents; Limitations on Facility Amounts
Section 5.01. Amendments and Modifications of Second Priority Financing
Documents. (a) Unless the Required Senior Lenders have consented thereto in
writing, the Borrower shall not, Vencor shall not, the Borrower shall not permit
any Restricted Subsidiary to, and no Second Priority Secured Party shall,
consent to or solicit any amendment or supplement to, or any waiver or other
modification of any Second Priority Financing Document if the effect thereof
would be to (i) increase the amount, or accelerate the date of payment, of any
obligation of the Borrower or any Guarantor thereunder or (ii) modify or alter
in any respect the terms of the subordination provisions set forth therein
(including without limitation, in Article 11 and Section 12.05(g) of the Second
Priority Credit Agreement) or impair in any way the rights and benefits of the
Senior Secured Parties thereunder.
Section 5.02. Limitation on Senior Credit Agreement. None of the Borrower,
Vencor or the Senior Secured Parties will amend or modify, or consent to any
amendment or modification of, the Senior Credit Agreement if the effect thereof
would be to increase the principal amount or commitments thereunder to
20
an amount in excess of $120,000,000 less any amounts up to an aggregate of
$45,000,000 by which the commitments under the Senior Credit Agreement have been
permanently reduced; provided that any amounts owing by the Borrower or any
Guarantor under any Designated Interest Rate Agreement (as defined in the Senior
Credit Agreement) shall be excluded form the calculation of the foregoing
amounts.
ARTICLE 6
Release of Collateral; Expiration of Certain Rights
Section 6.01. Releases of Collateral. At any time during which no
Triggering Event has occurred and is continuing:
(a) If (i) any Collateral is to be disposed of in a disposition that is
specifically permitted by the Financing Documents, (ii) the Borrower delivers a
certificate to such effect to the Second Priority Collateral Agent and the
Senior Collateral Agent at least three Business Days before the date of the
requested release, and (iii) neither the Senior Collateral Agent nor the Second
Priority Collateral Agent objects before the date of the requested release that
such disposition is prohibited by the Senior Financing Documents or the Second
Priority Financing Documents, as the case may be, then the Liens in favor of the
Secured Parties under the Collateral Documents with respect to such Collateral
(but, except in the case of the Kingfish Transaction, not the proceeds thereof)
will be released automatically upon consummation of such disposition, without
the need for any consent or approval by any other Secured Party, and the Second
Priority Collateral Agent and the Senior Collateral Agent, at the expense of the
Borrower, shall execute such documents as are reasonably necessary to effectuate
such release. No such release shall require any consent or approval by any other
Secured Party.
(b) The Lien of any Senior Collateral Document may, at any time, be
released in whole or in part by the Senior Collateral Agent pursuant to written
directions signed by the Required Senior Lenders (or the Senior Collateral Agent
on behalf of the Required Senior Lenders), and the Lien of any Second Priority
Collateral Document may, at any time, be released in whole or in part by the
Second Priority Collateral Agent pursuant to written directions signed by the
Required Second Priority Lenders (or the Second Priority Collateral Agent on
behalf of the Required Second Priority Lenders); provided that the release of
all or substantially all of the Collateral shall require the written consent of
all Secured Parties. Except as aforesaid, no such release shall require any
consent or approval by any other Secured Party.
21
ARTICLE 7
Miscellaneous
Section 7.01. Amendments, Supplements and Waivers. The Required Senior
Lenders and the Required Second Priority Lenders (and with respect to any such
amendment, supplement or waiver (i) which increases the obligations or reduces
the rights of the Borrower or Vencor, with the consent of the Borrower and
Vencor, (ii) which increases the obligations or reduces the rights of the Senior
Collateral Agent, with the consent of the Senior Collateral Agent and (iii)
which increases the obligations or reduces the rights of the Second Priority
Collateral Agent, with the consent of the Second Priority Collateral Agent) may
from time to time amend, supplement or waive any provision hereof. Any such
amendment, supplement or waiver shall be in writing and shall be binding upon
the Secured Parties and their respective successors and assigns.
Section 7.02. Notices. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile transmission or
similar writing) and shall be given to such party:
(i) in the case of the Borrower or Vencor, to it at:
Vencor, Inc.
(to be renamed Kindred Healthcare, Inc.)
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: General Counsel
Facsimile: (000) 000-0000
with copies to:
Vencor, Inc.
(to be renamed Kindred Healthcare, Inc.)
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Attn: Assistant Treasurer
Facsimile: (000) 000-0000
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
22
Attn: Xxxxxx Xxxxxxx, Esq.
Xxxxxxx Xxxxxxxxx, Esq.
(ii) in the case of the Senior Collateral Agent, to it at:
Xxxxxx Guaranty Trust Company of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Houston Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
X.X. Xxxxxx Services
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx and Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(iii) in the case of the Second Priority Collateral Agent, to it at:
Xxxxxx Guaranty Trust Company of New York
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Houston Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
X.X. Xxxxxx Services
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx and Xxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(iv) in the case of any party, to it at such other address or
facsimile number as such party may hereafter specify for the purpose by
notice to the other parties hereto.
23
Each such notice, request or other communication shall be effective (x) if given
by facsimile transmission, when transmitted to the facsimile number referred to
in this Section and confirmation of receipt is received, (y) if given by mail,
five days after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid or (z) if given by any other means, when
delivered at the address referred to in this Section.
Section 7.03. Headings. Headings used in this Agreement are for convenience
only and shall not affect the construction of this Agreement.
Section 7.04. Severability. If any provision of this Agreement is invalid
or unenforceable in any jurisdiction, then, to the fullest extent permitted by
law, the other provisions of this Agreement shall remain in full force and
effect in such jurisdiction and shall be liberally construed in favor of the
Senior Collateral Agent and the Senior Secured Parties in order to carry out the
intentions of the parties hereto as nearly as may be possible; and the
invalidity or unenforceability of any provision thereof in any jurisdiction
shall not affect the validity or enforceability of such provision in any other
jurisdiction.
Section 7.05. Dealings with the Borrower and the Guarantors. Upon any
application or demand by the Borrower or any Guarantor to the Second Priority
Collateral Agent or the Senior Collateral Agent to take or permit any action
under any of the provisions of this Agreement or under any Collateral Document,
the Borrower or such Guarantor, as appropriate, shall furnish to the Second
Priority Collateral Agent or the Senior Collateral Agent a certificate of an
appropriate officer stating that all conditions precedent, if any, provided for
in this Agreement or such Collateral Document, as the case may be, relating to
the proposed action have been complied with, except that in the case of any such
application or demand as to which the furnishing of such documents is
specifically required by any provision of this Agreement or any Collateral
Document relating to such particular application or demand, no additional
certificate or opinion need be furnished.
Section 7.06. Binding Effect. (a) This Agreement shall be binding upon and
inure to the benefit of each of the parties hereto and each of the Secured
Parties and their respective successors and assigns, and nothing herein or in
any Collateral Document is intended or shall be construed to give any other
person any right, remedy or claim under, to or in respect of this Agreement or
the Collateral.
(b) Xxxxxx may resign as Senior Collateral Agent or Second Priority
Collateral Agent at any time and may appoint any other subsidiary of X.X. Xxxxxx
Chase & Co. to such role by giving written notice thereof to each of the Secured
24
Parties and the Borrower. Upon such appointment, such subsidiary shall thereupon
succeed to and become vested with all the rights and duties of Xxxxxx in such
capacity and Xxxxxx shall be discharged from its duties and obligations in such
capacity hereunder.
Section 7.07. Counterparts. This Agreement may be executed in separate
counterparts, each of which shall be an original and all of which taken together
shall constitute one and the same instrument.
Section 7.08. NEW YORK LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT AS OTHERWISE REQUIRED BY
MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT THAT REMEDIES PROVIDED BY
THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK ARE GOVERNED BY
THE LAWS OF SUCH JURISDICTION.
Section 7.09. CONSENT TO JURISDICTION AND SERVICE OF PROCESS. THE BORROWER
AND VENCOR EACH HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK
STATE COURT SITTING IN NEW YORK CITY FOR PURPOSES OF ALL LEGAL PROCEEDINGS
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE FINANCING DOCUMENTS
OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. THE BORROWER AND VENCOR EACH
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A
COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
Section 7.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE FINANCING DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
25
HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE FINANCING DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 7.10.
Section 7.11. Bailee for Perfection. The Senior Collateral Agent hereby
acknowledges that, to the extent that it holds, or a third party holds on its
behalf, possession of Collateral pursuant to the Senior Collateral Documents
which is also Collateral under the Second Priority Collateral Documents, such
possession is also for the benefit of the Second Priority Collateral Agent and
the Second Priority Secured Parties to the extent required to perfect their
security interest in such Collateral. Nothing in the preceding sentence shall be
construed to impose any additional duty on the Senior Collateral Agent with
respect to such Collateral or provide the Second Priority Collateral Agent or
any Second Priority Secured Party with any rights with respect to such
Collateral beyond those specified in this Agreement.
26
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
VENCOR OPERATING, INC.,
(to be renamed Kindred Healthcare Operating, Inc.)
By_________________________________________
Name:
Title:
VENCOR, INC.,
(to be renamed Kindred Healthcare, Inc.)
By_________________________________________
Name:
Title:
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Senior Collateral Agent for and on
behalf of the Senior Lenders,
By____________________________________________
Name:
Title:
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK,
as Second Priority Collateral Agent for
and on behalf of the Second Priority Lenders,
By____________________________________________
Name:
Title:
28
EXHIBIT F-1
April ___, 2001
To the Lenders and the Agents referred to below
c/x Xxxxxx Guaranty Trust Company
of New York
as Collateral Agent and Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
In my capacity as general counsel of Vencor, Inc. (to be renamed Kindred
Healthcare, Inc.), a Delaware corporation ("Vencor"), I have acted as general
counsel of each of the Persons listed on Annex A hereto (the "Covered
Companies") in connection with (i) the Credit Agreement dated as of April ___,
2001 (the "Credit Agreement") among Vencor Operating, Inc. (to be renamed
Kindred Healthcare Operating, Inc.), a Delaware corporation (the "Issuer"),
Vencor, and the Lenders party thereto (the "Lenders"), and Xxxxxx Guaranty Trust
Company of New York, as Collateral Agent and Administrative Agent, and the other
Financing Documents referred to therein and (ii) the Master Lease Agreements
referred to therein. This opinion is being rendered to you pursuant to Section
3.01(o)(i)(A) of the Credit Agreement.
Unless otherwise defined herein, capitalized terms defined in the Credit
Agreement or the Security Agreement are used herein as defined therein.
I, or attorneys in the legal department of Vencor under my direction, have
examined originals or copies, certified or otherwise identified to my
satisfaction, of each of the agreements listed on Annex B hereto (the "Covered
Financing Documents"), the Master Lease Agreements and such other documents,
corporate records, certificates of public officials and other instruments, and
have conducted such other investigations of fact and law, as I have deemed
necessary or advisable for purposes of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. Each Covered Company has been incorporated or organized and is existing
in good standing as a corporation, limited liability company or partnership
under the laws of its jurisdiction of incorporation or organization, with power
and authority (corporate and other) to own its properties and conduct its
business as contemplated by the Plan of Reorganization.
2. Each Covered Company has been qualified as a foreign corporation,
limited liability company or partnership for the transaction of business and is
in good standing under the laws of each other jurisdiction in which it owns or
leases properties, or conducts any business, so
2
________, 2001
as to require such qualification, except where failures to be so qualified would
not, in the aggregate, have a Material Adverse Effect.
3. All of the outstanding shares of capital stock pledged under the
Security Agreement have been duly and validly authorized and issued, are fully
paid and non-assessable, and are owned directly or indirectly by the applicable
Lien Grantor as set forth in the Security Agreement, free and clear of all
Liens, equities or claims, except the Liens in favor of the Collateral Agent and
the Exit Facility Collateral Agent.
4. To the best of my knowledge after due inquiry, upon consummation by the
Covered Companies of the transactions contemplated on the Effective Date, no
Covered Company is, or with the giving of notice or lapse of time or both would
be, in violation of or in default under (a) its Organizational Documents, (b)
any indenture, mortgage, deed of trust or loan agreement, (c) any lease or other
agreement or instrument known to me after due inquiry to which any Covered
Company is a party or by which it or any of its properties is bound or (d) the
Plan of Reorganization, except for violations and defaults which in the
aggregate would not have a Material Adverse Effect.
5. To the best of my knowledge after due inquiry, the execution and
delivery by each Covered Company and its performance of its obligations under
the Covered Financing Documents and the Master Lease Agreements to which it is a
party and the consummation of the transactions contemplated therein will not:
(a) conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument
known to me after due inquiry to which any Covered Company is a party
or by which any Covered Company is bound or result in the creation or
imposition of any Lien upon any property or assets of any Covered
Company;
(b) result in any violation of the provisions of the
Organizational Documents of any Covered Company, the Plan of
Reorganization or any applicable law or statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over any Covered Company or any of its properties; or
(c) require any action by or in respect of, or filing with, any
governmental body, agency or official, except (i) filings of Uniform
Commercial Code financing statements (as in effect in the State of
California) delivered to the Collateral Agent on or before the date
hereof for filing promptly after the date hereof, (ii) Intellectual
Property Filings, (iii) the due recordation of memoranda of lease with
respect to the Master Lease Agreements and any assignment thereof to
the Issuer, (iv) the due recordation of the Leasehold Mortgages, (v)
the due recordation of the Fee Mortgages, (vi) any other filings
required after the date hereof pursuant to Section 5.09 of the Credit
Agreement, (vii) such other actions or filings as have been taken or
made before the date hereof and are in full force
3
________, 2001
and effect on the date hereof and (viii) filings of Uniform Commercial
Code continuation statements when required,
except for such conflicts, breaches, defaults, Liens and violations which
in the aggregate would not be material to the Covered Companies, taken as a
whole, and would not otherwise have a Material Adverse Effect.
6. Except as set forth in Schedule 8 to the Credit Agreement, there are
no legal or governmental investigations, actions, suits or proceedings pending
or, to the best of my knowledge, threatened against or affecting any Covered
Company or any of its properties or to which any Covered Company is or may be a
party or to which any property of any Covered Company is or may be the subject
which, if determined adversely to any Covered Company, could in the aggregate
have, or reasonably be expected to have, a Material Adverse Effect; and, to the
best of my knowledge, no such proceedings are threatened or contemplated by
governmental authorities or threatened by others.
7. Each Covered Company owns, possesses or has obtained all licenses,
permits, certificates, consents, orders, approvals and other authorizations
from, and has made all declarations and filings with, all Federal, state, local
and other governmental authorities, all self-regulatory organizations and all
courts and other tribunals, domestic or foreign, necessary to own or lease, as
the case may be, and to operate its properties and to carry on its business as
conducted as of the date hereof, except where failures to own, possess or obtain
any such licenses, permits, certificates, consents, orders, approvals or other
authorizations would not have, and could not reasonably be expected to have, in
the aggregate a Material Adverse Effect; no Covered Company has received any
notice of any proceeding relating to revocation or modification of any such
license, permit, certificate, consent, order, approval or other authorization,
except where such revocations or modifications would not have, and could not
reasonably be expected to have, in the aggregate a Material Adverse Effect; and
each Covered Company is in compliance with all laws and regulations relating to
the conduct of its business except where such noncompliance would not have, and
could not reasonably be expected to have, in the aggregate a Material Adverse
Effect.
8. The chief executive office of each Covered Company for purposes of
KRS 355.9-103(3)(d) is 000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000.
9. Each Covered Financing Document and Master Lease Agreement has been
duly authorized, executed and delivered by each Covered Company party thereto.
10. Each Covered Financing Document and Master Lease Agreement constitutes
a valid and legally binding obligation of each Covered Company party thereto,
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles.
I am a member of the bar of the State of California. The foregoing
opinions (with the exception of paragraphs (1) and (2), above) are limited to
the Federal laws of the United States, and the laws of the States of California
and New York and the General Corporation Law of the
4
________, 2001
State of Delaware and I am expressing no opinion as to the effect of laws of any
other jurisdiction. In rendering the foregoing opinions, I have relied (A) as to
matters involving the application of laws of the State of New York, upon the
opinion of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, dated and delivered to you today,
and (B) as to matters of fact, on certificates of responsible officers of the
Issuer and Vencor and information obtained from public officials and other
sources believed by me to be responsible. With respect to the opinions expressed
in paragraph (1) above, I have relied upon certificates of good standing issued
by the Secretary of State of the respective jurisdiction of incorporation of
each Covered Company. In addition, I have assumed that the Covered Documents
have been duly authorized, executed and delivered by all parties thereto other
than the Covered Companies parties thereto.
5
________, 2001
This opinion is rendered solely to you in connection with the above matter.
This opinion may not be relied upon by you for any other purpose or relied upon
by any other person without my prior written consent.
Very truly yours,
__________________
M. Xxxxxxx Xxxxxxx
Annex A - Covered Companies
---------------------------
1. Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), a Delaware
corporation.
2. Vencor Operating, Inc. (to be renamed Kindred Healthcare Operating, Inc.), a
Delaware corporation.
3. Each Restricted Subsidiary listed in Schedule 1 to the Credit Agreement.
Annex B - Covered Financing Documents
-------------------------------------
1. Credit Agreement
2. Notes issued to the Lenders signatory to the Credit Agreement on the date
hereof
3. Subsidiary Guaranty Agreement
4. Vencor Guaranty Agreement
5. Security Agreement
6. Leasehold Mortgages relating to the Initial Master Lease Properties and the
Other Leased Properties
7. Fee Mortgages relating to the Owned Properties
8. Intercreditor Agreement
9. Account Control Agreement
10. Copyright Security Agreement
11. Trademark Security Agreement
Exhibit F-2
April , 2001
To the Lenders and the Agents referred to below
c/x Xxxxxx Guaranty Trust Company
of New York
as Collateral Agent and Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
This opinion is being rendered to you in my capacity as Vice President of
Corporate Legal Affairs and Corporate Secretary of Vencor, Inc. (to be renamed
Kindred Healthcare, Inc.), a Delaware corporation ("Vencor"), in connection with
(i) the Credit Agreement dated as of April ___, 2001 (the "Credit Agreement")
among Vencor Operating, Inc. (to be renamed Kindred Healthcare Operating, Inc.),
a Delaware corporation (the "Issuer"), Vencor, and the Lenders party thereto
(the "Lenders"), and Xxxxxx Guaranty Trust Company of New York, as Collateral
Agent and Administrative Agent, and the other Financing Documents referred to
therein and (ii) the Master Lease Agreements referred to therein. This opinion
is being issued to you pursuant to Section 3.01(o)(i)(B) of the Credit
Agreement.
Unless otherwise defined herein, capitalized terms defined in the Credit
Agreement or the Security Agreement are used herein as defined therein.
I have examined originals or copies, certified or otherwise identified to
my satisfaction, of each of the agreements listed on Annex A hereto (the
"Covered Financing Documents"), the Master Lease Agreements and such other
documents, corporate records, certificates of public officials and other
instruments, and have conducted such other investigations of fact and law, as I
have deemed necessary or advisable for purposes of this opinion.
Upon the basis of the foregoing, I am of the opinion that:
1. To the best of my knowledge after due inquiry, the execution and
delivery by each of the Persons listed on Annex B hereto (each, a "Covered
Company") and its performance of its obligations under the Covered Financing
Documents and the Master Lease Agreements to which it is a party and the
consummation of the transactions contemplated therein will not require any
action by or in respect of, or filing with, any governmental body, agency or
official, except (i) filings of Uniform Commercial Code financing statements (as
in effect in the Commonwealth of Kentucky) delivered to the Collateral Agent on
or before the date hereof for filing promptly after the date hereof, (ii)
Intellectual Property Filings, (iii) the due recordation of memoranda of lease
with respect to the Master Lease Agreements and any assignment thereof to the
Issuer, (iv) the due recordation of the Leasehold Mortgages, (v) the due
recordation of the Fee Mortgages, (vi) any other filings required after the date
hereof pursuant to Section 5.09 of the Credit Agreement,
2
(vii) such other actions or filings as have been taken or made before the date
hereof and are in full force and effect on the date hereof and (viii) filings of
Uniform Commercial Code continuation statements when required.
2. The financing statements attached hereto as Annex C are in appropriate
-------
form for filing with the Secretary of State and the Jefferson County Clerk of
the Commonwealth of Kentucky. To the extent that a security interest in the
Personal Property Collateral may be perfected by the filing of a financing
statement in the Commonwealth of Kentucky, the security interest in the Personal
Property Collateral will be perfected upon the filing of such financing
statements with the Secretary of State and the Jefferson County Clerk of the
Commonwealth of Kentucky, and no further filing or recording of any document or
instrument or other action will be required so to perfect such security
interest, except that (i) continuation statements with respect to each such
financing statement must be filed within five years after the date of filing of
such financing statements and (ii) additional filings may be necessary if any
Lien Grantor changes its name, identity or corporate structure or the
jurisdiction in which its places of business, its chief executive office or its
Personal Property Collateral are located.
I am a member of the bar of the Commonwealth of Kentucky. The foregoing
opinions are limited to the laws of the Commonwealth of Kentucky and I am
expressing no opinion as to the effect of laws of any other jurisdiction.
3
This opinion is rendered solely to you in connection with the above matter.
This opinion may not be relied upon by you for any other purpose or relied upon
by any other person without my prior written consent.
Very truly yours,
Xxxxxx X. Xxxxxxxxxx
Annex A - Covered Financing Documents
-------------------------------------
1. Credit Agreement
2. Notes issued to the Lenders signatory to the Credit Agreement on the date
hereof
3. Subsidiary Guaranty Agreement
4. Vencor Guaranty Agreement
5. Security Agreement
6. Leasehold Mortgages relating to the Initial Master Lease Properties and the
Other Leased Properties
7. Fee Mortgages relating to the Owned Properties
8. Intercreditor Agreement
9. Account Control Agreement
10. Copyright Security Agreement
11. Trademark Security Agreement
Annex B - Covered Companies
---------------------------
1. Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), a Delaware
corporation.
2. Vencor Operating, Inc. (to be renamed Kindred Healthcare Operating, Inc.), a
Delaware corporation.
3. Each Restricted Subsidiary listed in Schedule 1 to the Credit Agreement.
Annex C Financing Statements
------------------------------
EXHIBIT G
Writer's Direct Dial: (000) 000-0000
April 20, 2001
To the Lenders and Agents
referred to below
c/x Xxxxxx Guaranty Trust Company
of New York,
as Collateral Agent and Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
We have acted as special New York counsel to each of Vencor, Inc. (to
be renamed Kindred Healthcare, Inc.), a Delaware corporation ("Vencor") and
Vencor Operating, Inc. (to be renamed Kindred Healthcare Operating, Inc.), a
Delaware corporation (the "Company" and, collectively with Vencor and each
Restricted Subsidiary listed in Schedule 1 to the Credit Agreement referred to
below, the "Covered Companies"), in connection with (i) the Credit Agreement
dated as of April 20, 2001 (the "Credit Agreement") among the Company, Vencor,
the Lenders party thereto (the "Lenders"), and Xxxxxx Guaranty Trust Company of
New York, as Collateral Agent and Administrative Agent, and the other Financing
Documents referred to therein and (ii) the Master Lease Agreements. This opinion
is being rendered to you pursuant to Section 3.01(o)(ii) of the Credit
Agreement.
Unless otherwise defined herein, capitalized terms defined in the
Credit Agreement or the Security Agreement are used herein as defined therein.
In arriving at the opinions expressed below, we have examined the
following documents:
(a) an executed copy of the Credit Agreement;
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent, et al.
-----
April 20, 2001
p. 2
(b) copies of the Notes as issued by the Company to the Lenders;
(c) an executed copy of the Subsidiary Guaranty Agreement;
(d) an executed copy of the Vencor Guaranty Agreement;
(e) an executed copy of the Security Agreement;
(f) an executed copy of the Intercreditor Agreement;
(g) an executed copy of the Account Control Agreement;
(h) an executed copy of the Copyright Security Agreement;
(i) an executed copy of the Trademark Security Agreement;
(j) executed copies of the Master Lease Agreements;
(k) executed copies of the Fee Mortgages relating to the Owned
Properties (the "Covered Fee Mortgages");
(l) executed copies of the Leasehold Mortgages relating to the
Initial Master Lease Properties and the Other Leased Properties
(collectively, the "Covered Leasehold Mortgages"); and
(m) the Plan of Reorganization.
The documents referenced in items (a) through (j) above are
collectively referred to herein as the "Covered Financing Documents", and the
Covered Financing Documents, Covered Fee Mortgages and Covered Leasehold
Mortgages are collectively referred to herein as the "Covered Documents".
In addition, we have examined the originals, or copies certified or
otherwise identified to our satisfaction, of corporate records of each Covered
Company that is organized under the laws of the State of New York or Delaware
(each such Covered Company, a "Domestic Covered Company"), certificates of
public officials and of officers and representatives of each Domestic Covered
Company and such other persons, and we have made such investigations of law, as
we have deemed necessary as a basis for the opinions expressed below.
In rendering the opinions expressed below, we have assumed the
authenticity of all documents submitted to us as originals and the conformity to
the originals of all documents submitted to us as copies. In addition, we have
assumed and have not verified the accuracy as to factual matters of each
document we have reviewed (including, without limitation, the accuracy of the
representations and warranties of the Company and Vencor in the Credit
Agreement).
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent, et al.
-----
April 20, 2001
p. 3
Based upon the foregoing and subject to further assumptions and
qualifications set forth below, it is our opinion that:
1. Each Covered Document has been duly authorized, executed and
delivered by all necessary corporate action of each Domestic Covered Company
party thereto and has been duly executed and delivered under the laws of the
State of New York by each Covered Company other than a Domestic Covered Company
(each such Covered Company, a "Foreign Covered Company").
2. Each Covered Financing Document constitutes a valid and binding
obligation of each Covered Company party thereto, enforceable in accordance with
its terms, provided that we express no opinion with respect to any provision
under any Covered Financing Document which under the terms of such Covered
Financing Document is governed by the laws of a jurisdiction other than the
State of New York.
3. The execution and delivery of (i) the Covered Financing Documents
by each Covered Company party thereto and its performance of its obligations
thereunder, and (ii) the Covered Fee Mortgages and the Covered Leasehold
Mortgages by each Covered Company party thereto, and, in the case of clauses (i)
and (ii), the consummation of the transactions contemplated in each such Covered
Document at the time and in the manner therein contemplated, comply with the
requirements of, and are authorized by, the Plan of Reorganization, and will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under any Covered Financing Document, the Exit Facility or
the Plan of Reorganization.
4. The execution and delivery by each Covered Company and its
performance of its obligations under the Covered Documents to which it is a
party do not require any approval, consent, authorization or other action by, or
filing, recording or registration with, any governmental authority of the State
of New York, except (i) filings of Uniform Commercial Code (as in effect in the
State of New York, the "UCC") financing statements delivered to the Collateral
Agent on or before the date hereof for filing promptly after the date hereof,
(ii) Intellectual Property Filings, (iii) any other filings required after the
date hereof pursuant to Section 5.09 of the Credit Agreement, (iv) filings of
UCC continuation statements when required, and (v) such other consents,
authorizations, approvals or filings, if any, as may be required in connection
with the performance of the Covered Documents due to the specific nature or
scope of any particular business or activity conducted, or asset held, by a
Covered Company.
5. No Covered Company is, or after giving effect to the transactions
contemplated by the Covered Documents will be, (i) an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, (ii) a "holding company" or an
"affiliate" of a "holding company" or a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended, or (iii) otherwise subject to any regulatory scheme under the
Federal
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent, et al.
-----
April 20, 2001
p. 4
laws of the United States or under the laws of the State of New York which
restricts its ability to issue the Notes under the Credit Agreement.
6. The provisions of the Security Agreement are effective to create,
in favor of the Collateral Agent for the benefit of the Secured Parties, a valid
security interest in all Personal Property Collateral that is subject to Article
8 or 9 of the UCC of each Lien Grantor, as security for the Secured Obligations
of such Lien Grantor, except that the Security Agreement will create such
security interest in Personal Property Collateral in which such Lien Grantor has
no present rights only when such Lien Grantor acquires rights therein.
7. Assuming that the Secured Parties have no notice of any adverse
claim (as defined in the UCC) to any of the collateral described below, and no
notice that any Instruments are overdue or have been dishonored or of any
defense against or claim to such Instrument on the part of any Person, the
Security Agreement, together with possession and retention in the State of New
York by the Collateral Agent of (i) certificated securities under Article 8 of
the UCC constituting Pledged Equity Interests, and (ii) Instruments constituting
Pledged Instruments, in each case will create, together with related duly
executed and completed blank endorsements thereof, as of the effective date of
such pledge, a valid and perfected security interest under the UCC in such
Pledged Equity Interests or Pledged Instruments, as the case may be, in favor of
the Collateral Agent for the benefit of the Secured Parties, and such security
interest will have priority over all other security interests created under the
UCC in such Pledged Equity Interests and Pledged Instruments by the Covered
Company pledging such asset, other than security interests created under the
Exit Facility.
8. The issuance of the Notes as contemplated by the Credit Agreement
does not violate Regulation T, U or X of the Board of Governors of the Federal
Reserve System (the "Board").
In rendering the opinions set forth in paragraph (2) above, we express
no opinion with respect to:
(i) the validity, binding effect or enforceability of any provision in
the Security Agreement or any other Covered Document that purports to (A) impose
on the Collateral Agent or any other person standards for the care of Personal
Property Collateral in its possession other than as provided for in Section 9-
207 of the UCC, (B) permit the Collateral Agent or any other person to vote or
otherwise exercise any rights with respect to any of the Personal Property
Collateral absent compliance with the requirements of applicable laws and
regulations as to the voting of or other exercise of rights with respect to such
Personal Property Collateral, (C) waive, or consent to the absence of compliance
with, any rights of any Covered Company, or duties owing to it as a matter of
law, except to the extent that the Covered Company may so waive or consent under
applicable law, or (D) provide indemnification of any person to the extent such
provision covers or could be construed to cover losses or claims under federal
or state securities laws or to the extent inconsistent with public policy;
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent, et al.
-----
April 20, 2001
p. 5
(ii) other than as specifically set forth in paragraph (7) above, the
priority of any security interest in or to any of the Personal Property
Collateral or the perfection of any security interest in or to any of the
Personal Property Collateral; or
(iii) the creation of the leasehold estate or provisions of the Master
Lease Agreements relating thereto or the remedies set forth in Article XVI of
the Master Lease Agreements, which are governed by the laws of the state in
which the relevant leased property is located.
Insofar as the foregoing opinions relate to the validity, binding
effect or enforceability of any agreement or obligation of any Covered Company
(a) we have assumed that each party to such an agreement or obligation has
satisfied those legal requirements that are applicable to it to the extent
necessary to make such agreement or obligation enforceable against it (except
that no such assumption is made as to (i) any Domestic Covered Company and (ii)
any Foreign Covered Company regarding matters of the federal law of the United
States of America or the law of the State of New York) and (b) such opinions are
subject to applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general principles of equity. In addition,
certain of the remedial provisions of the Covered Documents may be further
limited or rendered unenforceable by other applicable laws and judicially
adopted principles, which, however, in our judgment do not make the remedies
provided for therein (taken as a whole) inadequate for the practical realization
of the principal benefits purported to be afforded thereby (except for the
economic consequences of procedural or other delay).
In rendering the opinion in paragraph 3 above, we have assumed that
all conditions precedent to the Effective Date have been satisfied as set forth
in the Plan of Reorganization.
In rendering the opinion in paragraph 4 above, we have assumed that
the Covered Companies are subject only to New York State laws and regulations
generally applicable to companies doing business in the State of New York.
In rendering the opinion in paragraph 7 above, we have assumed that as
of the date hereof and at any time an Instrument or a certificated security is
delivered to the Collateral Agent for the benefit of the Secured Parties, the
relevant Lien Grantor will own Collateral represented by such Instrument or
certificated security free and clear of any lien, claim or encumbrance (and we
express no opinion with respect thereto). We express no opinion with respect to
the priority of the security interest of the Secured Parties against (i) any
lien, claim or other interest that arises by operation of law and is given
priority over perfected security interests, (ii) any lien or claim in favor of
the United States or any agency or instrumentality thereof (other than liens
arising under the federal or state tax laws or ERISA), and (iii) any claim given
priority pursuant to 31 U.S.C. (S)3713. In addition, insofar as the security
interest secures "future advances" within the meaning of the UCC, the priority
of such security interest will be subject to the limitations set forth in
Sections 9-301(4) and 9-312(7) of the UCC.
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent, et al.
-----
April 20, 2001
p. 6
In rendering the opinion in paragraph 8 above, we have assumed that
none of the Lenders is a "creditor" within the meaning of Regulation T of the
Board.
We express no opinion as to (i) Section 12.04 of the Credit Agreement
insofar as it provides that any holder of a participation in a Note may exercise
set-off or similar rights with respect to such participation and (ii) the effect
of the law of any jurisdiction other than the State of New York wherein any
Lender may be located or wherein enforcement of the Credit Agreement or any of
the other Covered Financing Documents may be sought that limits the rates of
interest legally chargeable or collectible.
With respect to the submission in any Covered Document to the
jurisdiction of a United States federal court sitting in the State of New York,
we express no opinion as to the subject matter jurisdiction of any such court to
adjudicate any action relating to the Covered Document where jurisdiction based
on diversity of citizenship under 28 U.S.C. (S)1332 does not exist.
We note that the designation in any Covered Document of the U.S.
federal courts sitting in New York City as the venue for actions or proceedings
relating to such Covered Document is (notwithstanding the waiver contained in
any such Covered Document) subject to the power of such courts to transfer
actions pursuant to 28 U.S.C. (S)1404(a) or to dismiss such actions or
proceedings on the grounds that such a federal court is an inconvenient forum
for such an action or proceeding.
The foregoing opinion is limited to the Federal laws of the United
States, and the laws of the State of New York and the General Corporation Law of
the State of Delaware, and we are expressing no opinion as to the effect of the
laws of any other jurisdiction.
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent, et al.
-----
April 20, 2001
p. 7
We are furnishing this opinion letter to you in connection with the
Covered Documents. This opinion is not to be used, circulated, quoted or
otherwise referred to for any other purpose.
Very truly yours,
CLEARY, GOTTLIEB, XXXXX & XXXXXXXX
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Xxxxx X. Xxxxxxx
EXHIBIT H
April 20, 2001
To the Lenders and Agents referred to below
c/x Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrative Agent
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Vencor, Inc., et al.
-------------------
Ladies and Gentlemen:
We have acted as Delaware bankruptcy counsel to (i) Vencor, Inc. (to
be renamed Kindred Healthcare, Inc.), a Delaware corporation ("Vencor"), and a
debtor and debtor-in-possession in a jointly administered bankruptcy case, Case
Nos. 3199-3327 (the "Case"), in the United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court"), pending under chapter 11 of the
United States Code (the "Bankruptcy Code"), and (ii) the corporations listed on
Annex A attached hereto, in connection with the Credit Agreement, dated as of
April 20, 2001 (the "Credit Agreement"), among Vencor Operating, Inc. (to be
renamed Kindred Healthcare Operating, Inc.), a Delaware corporation, Vencor, the
Swingline Bank, LC Issuing Banks and the Lenders party thereto (collectively,
the "Lenders"), Xxxxxx Guaranty Trust Company of New York, as collateral agent
and administrative agent for the Lenders, and General Electric Capital
Corporation, as documentation agent and collateral monitoring agent, the other
Financing Documents referred to therein, and the Master Lease Agreements
referred to therein. This opinion is being delivered to you pursuant to the
requirements of the Credit Agreement.
In rendering this opinion, we have examined and relied upon copies of
the following documents: the Findings of Fact, Conclusions of Law and Order
Under 11 U.S.C. (S) 1129 and Rule 3020 of the Federal Rules of Bankruptcy
Procedure Confirming the Fourth Amended Plan of Reorganization of Vencor, Inc.,
et al., dated March 16, 2001 (the "Confirmation Order") executed by Judge Xxxx
X. Xxxxxxx in connection with the Case, a copy of which is attached hereto as
Exhibit A and a certified copy of the docket of the Clerk of the Bankruptcy
Court in the Case for the period of March 16, 2001 to April 20, 2001 (the
"Docket"), a copy of which is attached hereto as Exhibit B. In our examination
of documents, we have
Xxxxxx Guaranty Trust Company of New York
As Collateral Agent and Administrator Agent, et al.
-----
April 20, 2001
Page 2
assumed the genuineness of the signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as copies and the legal capacity of natural persons to
complete the execution of documents. As to facts material to our opinion, we
have relied without independent investigation on the above-referenced documents
and on the accuracy as of the date hereof of the matters therein contained. We
express no opinion below as to the existence or effect of any matter entered on
the Docket after the effective time of our review of the Docket (as referenced
below). Further, we express no view whether the terms of the Confirmation Order
are in conformance with the Bankruptcy Code or other applicable law.
Based on and subject to the foregoing, and limited in all respects to
matters of Delaware law and federal bankruptcy law, it is our view, based solely
upon our review of the Docket as it existed as of 12:32 p.m. on April 20, 2001,
that no notice of appeal of the Confirmation Order has been filed with the
Bankruptcy Court.
The opinions herein expressed are intended solely for the benefit of
the addressee hereof and the Lenders and the Agents in connection with the
transactions contemplated by the Credit Agreement and may not be relied upon by
any other person or entity, or for any other purpose, without our prior written
consent. Notwithstanding the forgoing, we hereby consent to reliance hereon by
any person becoming a Lender under the Credit Agreement. This opinion speaks
only as of the date hereof and is based on our understandings and assumptions as
to present facts, and our review of the above-referenced documents and the
application of Delaware and federal bankruptcy law as the same exist on the date
hereof, and we undertake no obligation to update or supplement this opinion
after the date hereof for the benefit of any person or entity with respect to
any facts or circumstances that may hereafter come to our attention or any
changes in facts or law that may hereafter occur or take effect.
Very truly yours,
Xxxxxx X. Xxxxxx
Enclosures
ANNEX A
TO
EXHIBIT H
Annex A--Covered Companies
--------------------------
1. Vencor, Inc. (to be renamed Kindred Healthcare, Inc.), a Delaware
corporation.
2. Vencor Operating, Inc. (to be renamed Kindred Healthcare Operating,
Inc.), a Delaware corporation.
3. Each Restricted Subsidiary listed in Schedule 1 to the Credit
Agreement.
EXHIBIT A
TO
EXHIBIT H
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
In re: ) Case Nos. 99-3199 (MFW)
) through 99-3327 (MFW)
Vencor, Inc., et al., )
) Chapter 11
Debtors and Debtors in Possession )
) Jointly Administered
FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER
UNDER 11 U.S.C. (S) 1129 AND RULE 3020 OF THE FEDERAL
RULES OF BANKRUPTCY PROCEDURE CONFIRMING
THE FOURTH AMENDED PLAN OF REORGANIZATION
OF VENCOR, INC., et al.
----------------------------------------------------------
Upon the Fourth Amended Joint Plan Of Reorganization of Vencor, Inc.
And Affiliated Debtors Under Chapter 11 Of The Bankruptcy Code, dated as of
December 14, 2000 (including all amendments and modification thereof and
exhibits thereto, the "Plan") (D.I. 4031), filed with this Court by the above-
captioned debtors and debtors in possession (collectively, the "Debtors"), and
the Fourth Amended Disclosure Statement Pursuant To Section 1125 Of The
Bankruptcy Code With Respect To The Joint Plan Of Reorganization Of Vencor Inc.
And Affiliated Debtors Under Chapter 11 of The Bankruptcy Code and the Short-
Form of Fourth Amended Disclosure Statement Pursuant To Section 1125 Of The
Bankruptcy Code With Respect To The Joint Plan Of Reorganization Of Vencor, Inc.
Any Affiliated Debtors Under Chapter 11 of The Bankruptcy Code dated as of
December 14, 2000 (respectively, the "Disclosure Statement" (D.I. 4031), the
"Short-Form Disclosure Statement" (D.I. 4032), and collectively, the "Disclosure
Materials"), and the Fourth Amended Plan Supplement To Joint Plan of
Reorganization of Vencor, Inc. And Affiliated Debtors Under Chapter 11 Of The
Bankruptcy Code (including all amendments and modification of the exhibits
thereto, the "Plan
Supplement") (D.I. 4588) filed with this Court by the Debtors; and upon (a) the
hearing before this Court on December 6, 2000 to consider approval of the
Disclosure Materials and (b) the Order dated December 6, 2000 approving the
Disclosure Materials (the "Disclosure Materials Order") (D.I. 4108); and
solicitation of acceptances of the Plan having been authorized by Order dated
December 7, 2000, establishing voting procedures and approving form of ballots
and notices (the "Voting Procedures Order") (D.I. 3828); and it appearing from
the affidavits of mailing and publication filed with this Court and the Voting
Affidavit (as defined herein) that copies of the Disclosure Statement (including
the Plan as annexed thereto as Exhibit A) or Short-Form Disclosure Statement,
notice of the Confirmation Hearing (as defined herein), and ballots for
acceptances or rejections of the Plan, were transmitted to the holders of Claims
against and Interests in Vencor, Inc., et al. and other parties in interest as
required by the Voting Procedures Order, and such transmissions at such time
being due and adequate notice under the circumstances, and that notice of the
Confirmation Hearing was published in the manner required by the Voting
Procedures Order; and the Voting Procedures Order fixing February 15, 2001 at
4:00 p.m. (Eastern Standard Time) as the deadline for filing of objections to
confirmation of the Plan; and upon the declaration of Xxxxxx X. Xxxxxxx (D.I.
5807), the declaration of Xxxx X. Xxxxxxxx (D.I. 5806) and the statement of the
Department of Justice in support of the Plan (D.I. 5815); and upon the Ventas
Entities' response in conditional support of the Plan (D.I. 5814); and upon this
Court's Order, dated January 16, 2001 extending the time for Ventas, Inc. and
Ventas Realty, Limited Partnership to vote on the Plan and/or file a response or
objection to confirmation of the Plan (the "Ventas Voting Stipulation") (D.I.
5008); and upon the affidavit of Xxxxxx X. Xxxxx dated February 20, 2001, filed
in support of confirmation of the Plan (D.I. 5779); and upon the affidavit of
Xxxxxx X. Xxxxx dated February 21, 2001, filed in
2
support of confirmation of the Plan (D.I. 5777); and a hearing to consider
confirmation of the Plan having been held before this Court commencing on March
1, 2001 (the "Confirmation Hearing"); and upon the full and complete record of
the Confirmation Hearing, including without limitation the exhibits presented
and the testimonial proffers that were accepted into evidence, and all matters
and proceedings heretofore part of the record in these cases; and for the
reasons set forth on the record by the Court and after due deliberation and
sufficient cause appearing therefor;
FINDINGS OF FACT AND CONCLUSIONS OF LAW
---------------------------------------
IT IS HEREBY FOUND AND DETERMINED THAT:
1. All capitalized terms used but not defined herein shall have the
meanings ascribed to such terms in the Plan, unless the context otherwise
requires.
2. This Court has jurisdiction over the Reorganization Cases pursuant
to 28 U.S.C. (S)(S) 157 and 1334. Venue is proper before this Court pursuant to
28 U.S.C. (S)(S) 1408 and 1409. Confirmation of the Plan is a core proceeding
under 28 U.S.C. (S) 157(b)(2), and this Court has exclusive jurisdiction to
determine whether the Plan complies with the applicable provisions of title 11
of the United States Code (the "Bankruptcy Code") and the Federal Rules of
Bankruptcy Procedures (the "Bankruptcy Rules") and should be confirmed.
3. This Court takes judicial notice of the docket of the
Reorganization Cases maintained by the Clerk of the Court and/or its duly
appointed agent, including, without limitation, all pleadings and other
documents filed, all orders entered, and all evidence and arguments made,
proffered or adduced at, the hearings held before the Court during the pendency
of the Reorganization Cases, including, without limitation, the hearing to
consider the adequacy of the Disclosure Materials.
3
4. The Debtors, as proponents of the Plan, have the burden of proving
the elements of Section 1129 by a preponderance of the evidence.
5. Notice of the Confirmation Hearing and the relevant deadlines for
submission of objections and ballots, as prescribed by this Court in the Voting
Procedures Order, has been provided and is adequate and sufficient pursuant to
Section 1128 of the Bankruptcy Code, Rules 2002(b) and 3020 of the Bankruptcy
Rules and other applicable law and rules. Notice provided of the Confirmation
Hearing and the relevant deadlines for submission of objections and ballots and
service of the Disclosure Materials upon the individuals subject to the Debtors'
Motion for an Order Pursuant to Section 105(a) of the Bankruptcy Code and Rule
1009(a) of The Federal Rules of Bankruptcy Procedure Disallowing Certain
Scheduled Claims For Purposes Of Voting. On The Fourth Amended Joint Plan Of
Reorganization Under Chapter 11 Of The Bankruptcy Code, as set forth in the
Affidavit of Mailing of Xxxxxxx Gallerie dated January 10, 2001 and the
Affidavit of Xxxxx Xxxxxx dated January 23, 2001, is adequate and sufficient
pursuant to Section 1128 of the Bankruptcy Code, Rules 2002(b) and 3020 of the
Bankruptcy Rules and other applicable law and rules.
6. Ballots were transmitted to holders of claims in classes eligible
to vote on the Plan (the "Voting Classes") in accordance with the Voting
Procedures Order.
7. The Debtors solicited votes for the Plan from the Voting Classes
in good faith and in a manner consistent with the Bankruptcy Code.
8. The affidavits of Xxxxx Xxxxxx, dated February 26, 2001 (the
"Voting Affidavit") (D.I. 5801) and March 7, 2001 (the "Supplemental Voting
Affidavit") (D.I.T.B.D.), are consistent with Bankruptcy Rule 3018.
4
9. The classification scheme of Claims and Interests under the Plan
is reasonable. Claims or Interests in each Class are substantially similar to
other Claims or Interests in such Class, and the Plan therefore satisfies the
requirements of Section 1122(a) of the Bankruptcy Code.
10. The Plan provides for the treatment of Allowed Administrative
Claims and Allowed Priority Tax Claims. In addition, the Plan establishes the
following Classes of Claims and Interests: Class 1 (Priority Claims); Class 2
(Secured Claims); Class 3A (Convenience Claims); Class 3B (Trade Claims,
Malpractice and Other Litigation Claims, Benefits Claims, Indemnification
Claims, Employee Contact Claims and Unsecured Claims that are not Convenience
Claims); Class 4 (Senior Debt Claims); Class 5 (Ventas Claim); Class 6 (Class 6
Claims); Class 7A (Subordinated Noteholder Claims); Class 7B (Noteholder
Securities Fraud Claims); Class 8 (Put Rights); Class 10 (Punitive Damage
Claims); Class 11A (Preferred Equity Interests); Class 11B (Preferred Equity
Securities Fraud Claims); Class 12A (Common Equity Interests); and Class 12B
(Common Equity Securities Fraud Claims). The Plan satisfies the requirements of
Section 1123(a)(1) of the Bankruptcy Code.
11. The Plan establishes as Class 3A a class of claims consisting
only of unsecured claims that are reduced to or less than $3,000.00. Pursuant
to Section 1122(b) of the Bankruptcy Code, this is a reasonable amount necessary
for administrative convenience.
12. The following Classes of Claims are impaired and comprise the
Classes entitled to vote under the Plan: Classes 3A, 3B, 4, 5, 6, 7A and 8
(collectively, the "Voting Classes"). The following Classes of Claims are
unimpaired under the Plan Classes 1 and 2. The following Classes of Claims or
Interests are deemed to reject the Plan by virtue of receiving no distributions
thereunder, except as otherwise provided for under this Order: Classes 7B, 10,
11A,
5
11B, 12A and 12B. The treatment of Claims in unimpaired Classes is specified in
Article IV of the Plan, and the treatment of Claims and Interests in impaired
Classes is specified in Article V of the Plan. Therefore, the Plan satisfies the
requirements of Sections 1123(a)(2) and 1123(a)(3) of the Bankruptcy Code.
13. The Plan provides for the same treatment of each Claim or
Interest of a particular Class, and the Plan satisfies the requirements of
Section 1123(a)(4) of the Bankruptcy Code.
14. The Plan provides for adequate means for its implementation, and
therefore satisfies the requirements of Section 1123(a)(5) of the Bankruptcy
Code.
15. The Plan provides for the amendment of the Certificates of
Incorporation of the Debtors in substantially the form of the Vencor Amended and
Restated Certificate of Incorporation and the Form of Certificate of Amendment
of the Certificate of Incorporation of Each Corporate Debtor filed with this
Court in the Plan Supplement on December 29, 2000 (collectively and as may be
amended or modified, the "Amended Certificates of Incorporation"), which
prohibit the issuance of nonvoting equity securities. Any revisions to the
Amended Certificates of Incorporation filed on or prior to the Effective Date
also shall prohibit the issuance of a non-voting equity securities.
Accordingly, the Plan complies with Section 1123(a)(6) of the Bankruptcy Code.
16. The Plan impairs or leaves unimpaired, as the case may be, each
Class of Claims or Interests, and the Plan therefore is consistent with the
provisions of Section 1123(b)(1) of the Bankruptcy Code.
17. The Plan provides for the treatment under Section 365 of the
Bankruptcy Code, of all executory contracts and unexpired leases not previously
assumed or rejected or the
6
subject of a motion either to assume or reject pursuant to such section, and the
Plan therefore complies with the provisions of Section 1123(b)(2) of the
Bankruptcy Code.
18. Furthermore, the provisions of the Plan constitute a good faith
compromise and settlement of all Claims and Interests, and all controversies
respecting Claims and Interests are resolved pursuant to the Plan. This
Confirmation Order constitutes the Court's approval of all such compromises and
settlements which, based upon the representations by the Debtors, all other
testimony proffered and evidence introduced at the Confirmation Hearing and the
full record of the Reorganization Cases, the Court finds to be fair, equitable,
within the range of reasonableness and in the best interests of the Debtors, the
Estates, creditors and other parties in interest. Accordingly, the Plan
satisfies Section 1123(b)(3) of the Bankruptcy Code.
19. The Plan contains no provision that is inconsistent with the
applicable provisions of the Bankruptcy Code and therefore satisfies Section
1123(b)(6) of the Bankruptcy Code.
20. The Government Settlement and the allowance and settlement of the
Class 6 Claims and the payment of such claims, as set forth in Sections 5.05 and
6.12 of the Plan, constitute a good faith compromise and settlement pursuant to
Bankruptcy Rule 9019, and the Government Settlement, including the settlement
amount allocated for each of the Qui Tam Actions as enumerated on Schedule E to
the Plan, is fair, adequate and reasonable under all the circumstances. As to
United States, et al. ex rel. Xxxxxxxx-Xxxxx, et al. v. Behavioral Healthcare
-----------------------------------------------------------------------------
Corp., et al. referenced on Schedule E and Exhibit 5 to the Plan, the
-------------
government's settlement of this Qui Tam Action is effective only to the extent
the United States has authority to compromise and settle this Qui Tam Action
pursuant to the Federal Claims Act ("FCA"). The District Court in that action
may determine, on motion of any party to that action, whether the government had
7
authority to settle that action. In the event the United States does not have
authority to compromise and settle this Qui Tam Action, the Claims relating to
this Qui Tam Action shall be treated as stated on the record at the Confirmation
Hearing as a Class 3B claim.
21. The treatment provided to the Ventas Entities under the Plan,
including, without limitation, under Section 5.04 and Article XI of the Plan,
constitute a good faith compromise and settlement pursuant to Bankruptcy Rule
9019.
22. All settlements in these cases, including but not limited to
settlements with the creditors in Classes 3A, 3B, 4, 5, 6, 7A, 8 and 10,
constitute good faith compromises and settlements pursuant to Bankruptcy Rule
9019.
23. Pursuant to Section 1123(b)(3)(B) of the Bankruptcy Code, the
Plan, except as provided therein, provides for the retention and enforcement of
all claims, rights and causes of action of the Debtors and the Estates, whether
prepetition or postpetition, and regardless of whether such claims, rights or
causes of action arise under any or all agreements and applicable law or equity,
exclusively by the Reorganized Debtors. Under the Plan, all such claims, rights
and causes of action of the Debtors and the Estates, upon the Effective Date,
shall vest in the Reorganized Debtors and may be pursued by the Reorganized
Debtors except to the extent released under the Plan. Accordingly, the
retention and enforcement of all such claims, rights and causes of action of the
Debtors and the Estates exclusively by the Reorganized Debtors will benefit the
Debtors' creditors and the requirements of Sections 550(a) and 1123(b)(3)(B) of
the Bankruptcy Code are satisfied.
24. The Plan complies with the applicable provisions of the
Bankruptcy Code, including, without limitation, Sections 1122 and 1123 of the
Bankruptcy Code. Therefore, the Plan satisfies the requirements of Section
1129(a)(1) of the Bankruptcy Code. In addition, in
8
accordance with Bankruptcy Rule 3016(a), the Plan is dated and identified with
the names of the Debtors.
25. The Debtors, as proponents of the Plan, have complied with each
of the applicable provisions of the Bankruptcy Code including, without
limitation, Sections 1125 and 1126 of the Bankruptcy Code, and therefore have
satisfied the requirements of Section 1129(a)(2) of the Bankruptcy Code, as
follows: (a) the Debtors are proper debtors under Section 109 of the Bankruptcy
Code and proper proponents of the Plan under Section 1121(a) of the Bankruptcy
Code; (b) the Debtors have complied with each of the applicable provisions of
the Bankruptcy Code, except as otherwise provided or permitted by orders of the
Court; and (c) the Debtors have complied with each of the applicable provisions
of the Bankruptcy Code, the Bankruptcy Rules, the Voting Procedures Order and
the Ventas Voting Stipulation in transmitting notices and solicitation materials
and in soliciting and tabulating votes on the Plan.
26. The Plan has been proposed in good faith and not by any means
forbidden by law. In determining that the Plan has been proposed in good faith,
the Court has examined the totality of the circumstances surrounding the filing
and prosecution of the Debtors' Reorganization Cases and the formulation of the
Plan. The Debtors' chapter 11 cases were filed and the Plan was proposed with
the proper purpose of reorganizing the Debtors, and expeditiously making
distributions to their creditors. Furthermore, the Plan is the product of
extensive, arms' length negotiations among the Debtors, Ventas, the United
States, the Creditors' Committee, certain holders of the Senior Debt Claims and
Subordinated Noteholders, and each of their respective counsel and financial
advisors. The Plan reflects the results of these negotiations and is reflective
of the interests of all the Estates' constituencies. Thus, the Plan satisfies
the requirements of Section 1129(a)(3) of the Bankruptcy Code.
9
27. Any payments made or to be made by the Debtors for services or
for costs and expenses in, or in connection with, the Debtors' chapter 11 cases
have, to the extent required by the Bankruptcy Code, the Bankruptcy Rules and
the Orders of this Court, been approved by, or are subject to the approval of
this Court as reasonable. Accordingly, the Plan satisfies the requirements of
Section 1129(a)(4) of the Bankruptcy Code.
28. Section 8.07 of the Plan provides that Reorganized Vencor shall
have a board of directors consisting of seven (7) directors. The Board of
Directors or other current internal governance, as applicable, of the other
Reorganized Directors shall initially remain the same. The names and
affiliations of the persons designated pursuant to Section 8.07 of the Plan as
the initial members of the board of directors of each of the Reorganized Debtors
were disclosed to this Court prior to the Confirmation Hearing. In addition, the
Debtors disclosed the identity of any insiders that will be employed by the
Reorganized Debtors and the nature of their compensation. The appointment to
such office of each of the proposed directors and officers of each of the
Reorganized Debtors is consistent with the interests of creditors and equity
security holders and with public policy with respect to the manner of selection
of any officer or director of the Reorganized Debtors. Accordingly, the Plan
complies with Section 1123(a)(7) and 1129(a)(5) of the Bankruptcy Code.
29. Section 1129(a)(6) of the Bankruptcy Code is satisfied because
the Plan does not provide for any change in rates over which a governmental
regulatory commission has jurisdiction.
30. With respect to each impaired Class of Claims or Interests, each
holder of a Claim or Interest in such Class: (a) has accepted the Plan; or (b)
will receive or retain under the Plan on account of such Claim or Interest,
property of a value, as of the Effective Date of the
10
Plan, that is not less than the amount that such holder would so receive or
retain if such Debtor were to be liquidated under chapter 7 of the Bankruptcy
Code on such date. Accordingly, the Plan is in the best interests of the
creditors and satisfies the requirements of Section 1129(a)(7) of the Bankruptcy
Code.
31. As evidenced by the Voting Affidavit and the Supplemental Voting
Affidavit, the Plan has been accepted by each of the Voting Classes in
accordance with Section 1126 of the Bankruptcy Code and consistent with
Bankruptcy Rule 3018, the Voting Procedures Order and the Ventas Voting
Stipulation.
32. The Plan is deemed rejected, pursuant to Section 1126(g) of the
Bankruptcy Code, by the members of Classes 7B, 10, 11A, 11B, 12A and 12B, who
will receive no distribution and retain no interest on account of their
respective Claims or Interests, except as otherwise provided for under this
Order.
33. With respect to each Class of Claims or Interests designated by
the Plan, other than Classes 7B, 10, 11A, 11B, 12A and 12B, either: (a) such
Class has accepted the Plan; or (b) such Class is not impaired under the Plan.
Accordingly, the requirements of Section 1129(a)(8) of the Bankruptcy Code have
been satisfied with respect to all Claims and Interests other than those in
Classes 7B, 10, 11A, 11B, l2A and 12B. The Plan nevertheless may be confirmed
with respect to these Classes because, as stated below, the requirements of
Section 1129(b) of the Bankruptcy Code are satisfied with respect to these
Classes.
34. The treatment of Allowed Administrative Claims, Allowed Tax
Claims and Allowed Priority Claims under Sections 2.01, 2.03 and 4.01 of the
Plan satisfies the applicable requirements of Section 1129(a)(9)(A),(B) and (C)
of the Bankruptcy Code.
11
35. The Plan has been accepted by Classes 3A, 3B, 4, 5, 6 and 7A,
and, therefore, has been accepted by at least one impaired Class of Claims or
Interests, which acceptance has been determined without including any
acceptances of the Plan by any insider holding a Claim in such Class.
Accordingly, the requirements of Section 1129(a)(10) of the Bankruptcy Code are
satisfied with respect to the Plan.
36. The Plan satisfies Section 1129(a)(11) of the Bankruptcy Code
because confirmation of the Plan is not likely to be followed by liquidation or
the need for further financial reorganization of the Reorganized Debtors.
37. The fees payable by the Debtors to the United States Trustee or
the Clerk of this Court, as provided under 28 U.S.C. (S) 1930(a)(6), constitute
administrative expenses entitled to Priority under Section 507(a)(1) of the
Bankruptcy Code and the treatment of such fees in the Plan satisfies the
requirements of Section 1129(a)(12) of the Bankruptcy Code.
38. To the extent the Debtors are required to continue to provide any
retiree benefits (as that term is defined under Section 1114 of the Bankruptcy
Code), such benefits shall be continued under the Plan, and the Plan satisfies
the requirements of Section 1129(a)(13) of the Bankruptcy Code.
39. The requirements of Section 1129(b) of the Bankruptcy Code are
satisfied as to holders of Claims in Classes 7B, 10, 11A, 11B, 12A and 12B
because the Plan does not discriminate unfairly, and is fair and equitable, with
respect to each Class of Claims or Interests that is Impaired under, and that
has not accepted, the Plan, and no holder of any Interests of the Debtors that
is junior to the Interests of such Classes will receive or retain any property
under the Plan on account of such junior Interests.
12
40. Other than the Plan, no plan has been filed in these cases.
Accordingly, the requirements of Section 1129(c) of the Bankruptcy Code have
been satisfied.
41. No party in interest that is a governmental unit has requested
that the Court not confirm the Plan on the grounds that the principal purpose of
the Plan is the avoidance of taxes or the avoidance of the application of
Section 5 of the Securities Act of 1933, 15 U.S.C. (S) 77e, and the principal
purpose of the Plan is not such avoidance. Accordingly, the Plan satisfies the
requirements of Section 1129(d) of the Bankruptcy Code.
42. To the extent the terms of this Order may be construed to
constitute modifications to the Plan (the "Plan Modifications'), such Plan
Modifications do not materially or adversely affect or change the treatment of
any Claim against or Interest in any Debtor. Accordingly, pursuant to Bankruptcy
Rule 3019, the Plan Modifications do not require additional disclosure under
Section 1125 of the Bankruptcy Code or the resolicitation of acceptances or
rejections under Section 1126 of the Bankruptcy Code, nor do they require that
holders of Claims against or Interests in any Debtor to be afforded an
opportunity to change previously cast acceptances or rejections of the Plan as
filed with the Court. Disclosure of the Plan Modifications on the record at the
Confirmation Hearing constitutes due and sufficient notice thereof under the
circumstances of these Reorganization Cases. All references to the Plan in this
Order shall be to the Plan as so modified.
43. Based upon the record before the Court, the Debtors and their
agents, counsel and financial advisors have solicited votes on the Plan in good
faith and in compliance with the applicable provisions of the Bankruptcy Code
and are entitled to the protections afforded by Section 1125(e) of the
Bankruptcy Code and the exculpatory and injunctive provisions set forth in
Article XI of the Plan.
13
44. The Debtors, the Ventas Entities, each of their respective
Representatives, benefit plan administrators and trustees, and their officers,
directors, employees, agents, advisors legal and financial advisors, attorneys,
professionals, principals and agents, the Creditors' Committee and its members,
officers, directors, employees, agents, advisors, legal and financial advisors,
attorneys, professionals, principals and agents, the holders of the Senior Debt
Claims, their officers, directors, employees, agents, advisors, legal and
financial advisors, attorneys, professionals, principals and agents, and the
Subordinated Noteholders, their officers, directors, employees, agents,
advisors, legal and financial advisors, attorneys, professionals, principals and
agents (each of the foregoing solely in their capacity as such), have acted in
good faith and in compliance with the applicable provisions of the Bankruptcy
Code pursuant to Section1125(e) of the Bankruptcy Code and 1129(a)(3) of the
Bankruptcy Code, with respect to the administration of the Plan, the
solicitation of acceptances with regard thereto and the property to be
distributed thereunder.
45. The Court may properly retain jurisdiction over the matters set
forth in Section 13.01 of the Plan.
46. Upon entry of this Order, each of the conditions to confirmation
contained in Section 10.01 of the Plan shall have been satisfied.
DECREES
-------
NOW THEREFORE IT IS HEREBY ORDERED, ADJUDGED, DECREED AND DETERMINED
THAT:
1. To the extent that any objections have not been withdrawn or
resolved by stipulation prior to the entry of this Confirmation Order or are not
resolved by the relief granted herein or as stated on the record of the
Confirmation Hearing, all such objections are hereby overruled. The stipulations
entered into with (a) the State of Georgia, Department of Revenue
14
(D.I. 5834), (b) the Louisiana Department of Revenue (D.I. 5835), (c) the
Missouri Department of Revenue (D.I. 5836), (d) the Tennessee Department of
Revenue (D.I. 5837), and (e) the Texas Tax Authorities (D.I. 5838) fully resolve
the objections raised by these parties and govern the treatment of the claims of
these entities under the Plan.
2. The findings of this Court set forth above and the conclusions of
law stated herein shall constitute findings of fact and conclusions of law
pursuant to Bankruptcy Rule 7052, made applicable to this proceeding by
Bankruptcy Rule 9014. To the extent any findings of fact shall be determined to
be a conclusion of law, it shall be so deemed, and vice versa.
3. The Plan complies with the requirements of Sections 1122, 1123 and
1129 of the Bankruptcy Code.
4. To the extent the IRS holds an allowed claim properly classified,
and to the extent entitled to interest, the interest rate shall be at the
federal statutory rate as provided by the Internal Revenue Code.
5. The Plan (as modified by any modifications contained in this
Confirmation Order) is confirmed under Section 1129 of the Bankruptcy Code.
6. The provisions of the Plan and this Confirmation Order, including
the findings of fact and conclusions of law set forth herein, are nonseverable
and mutually dependent.
7. Plan Classification Controlling. The classification of Claims and
-------------------------------
Interests for purposes of the distributions to be made under the Plan shall be
governed solely by the terms of the Plan. The classifications and amounts of
Claims, if any, set forth in the Ballots tendered or returned by the Debtors'
creditors in connection with voting on the Plan (i) were set forth on the
Ballots solely for purposes of voting to accept or reject the Plan, (ii) do not
necessarily represent, and in no event shall be deemed to modify or otherwise
affect the actual classification of such
15
Claims or Interests under the Plan for distribution purposes and (iii) shall not
be binding on the Debtors, the Estates, or the Reorganized Debtors.
8. Certain Effects of Confirmation; Discharge; Injunction; Releases.
----------------------------------------------------------------
All of the provisions of Article XI, including Sections 11.01, 11.02(a),
11.02(b), 11.03, 11.04, 11.05, 11.06, 11.07 and 11.08 of the Plan, as restated
or amended by this paragraph, are incorporated herein by reference as if set
forth herein in extenso. Notwithstanding anything to the contrary contained in
----------
the Plan, nothing in Article XI of the Plan shall be construed as providing a
discharge or release of any claims that have been or may be asserted-by
Cornerstone Insurance Company ("Cornerstone") against any of the Ventas Parties
or by one or more of the Ventas Parties against Cornerstone. The evidence
presented in connection with the Confirmation Hearing establishes that the
releases of the nondebtor Entities contained in Article XI of the Plan are fair
and necessary to the reorganization of the Debtors, and that the nondebtor
Entities receiving the benefit of the releases contained in Article XI of the
Plan have made substantial contributions toward the reorganization of the
Debtors, which are integral to the effectuation of the Plan and the consummation
of the transactions contemplated therein (including, without limitation, the
funding of distributions to holders of Allowed Claims and the Debtors'
performance under the contracts and leases assumed pursuant to the Plan).
9. Retention and Enforcement of Estates' Claims and Rights. Except
-------------------------------------------------------
as set forth in the Plan or this Confirmation Order, the Debtors shall not be
deemed to have waived or relinquished:
(i) any rights of causes of action (prepetition or postpetition) that
the Debtors or the Reorganized Debtors may have currently or
which the Reorganized Debtors may choose to assert on behalf of
their Estates under any provision of the Bankruptcy Code or any
similar applicable non-bankruptcy law, including without
limitation, (i) breach of contract claims, (ii) the avoidance of
any transfer by or obligation of the Debtors or (iii) the
16
turnover of any property to the Estates, all of which are
expressly reserved by the Plan and may only be pursued by the
Reorganized Debtors;
(ii) any claim, cause of action, right of setoff or other legal or
equitable defense which the Debtors had immediately prior to the
Petition Date, against or with respect to any Claim left
unaltered or Unimpaired by the Plan. The Reorganized Debtors
shall have, retain, reserve and be entitled to assert all such
claims, causes of action, rights of setoff and other legal or
equitable defenses which they had immediately prior to the
Petition Date fully as if the chapter 11 cases had not been
commenced; and all of the Reorganized Debtors' legal and
equitable rights respecting any Claim left unaltered or
Unimpaired by the Plan may be asserted after the Confirmation
Date to the same extent as if the chapter 11 cases had not been
commenced.
10. As of the Effective Date, the Government Settlement and the
allowance and settlement of the Class 6 Claims and the payment of such claims,
as set forth in Sections 5.05 and 6.12 of the Plan, is approved as a good faith
compromise and settlement pursuant to Bankruptcy Rule 9019, and the Government
Settlement, including the settlement amount allocated for each of the Qui Tam
Actions as enumerated on Schedule E to the Plan, is fair, adequate and
reasonable under all the circumstances. As to United States, et al. ex rel.
-----------------------------
Xxxxxxxx-Xxxxx, et al. v. Behavioral Healthcare Corp., et al. referenced on
-------------------------------------------------------------
Schedule E and Exhibit 5 to the Plan, the government's settlement of this Qui
Tam Action is effective only to the extent the United States has authority to
compromise and settle this Qui Tam Action pursuant to the Federal Claims Act
("FCA"). The District Court in that action may determine, on motion of any party
to that action, whether the government had authority to settle that action. In
the event the United States does not have authority to compromise and settle
this Qui Tam Action, the Claims relating to this Qui Tam Action shall be treated
as stated on the record at the Confirmation Hearing as a Class 3B claim.
17
11. As of the Effective Date, the treatment provided to the Ventas
Entities under the Plan, including, without limitation, under Section 5.04 and
Article XI of the Plan, constitute a good faith compromise and settlement
pursuant to Bankruptcy Rule 9019.
12. All settlements in these cases, including settlements with the
creditors in Class 3A, 3B, 4, 5, 6, 7A, 8 and 10 are hereby approved as good
faith compromises and settlements pursuant to Bankruptcy Rule 9019.
13. Binding Effect. Pursuant to Section 1141 of the Bankruptcy Code,
--------------
effective as of the Confirmation Date, but subject to the occurrence of the
Effective Date, and except as expressly provided in the Plan, the Plan Documents
or this Confirmation Order, the provisions of the Plan (including the exhibits
to, and all documents and agreements contemplated by and executed pursuant to
the Plan) and this Confirmation Order shall be binding on (i) the Debtors, (ii)
the Reorganized Debtors, (iii) all holders of Claims against and Interests in
the Debtors, whether or not impaired under the Plan and whether or not, if
impaired, such holders accepted the Plan, and (iv) each Person or Entity
acquiring property under the Plan. The holders of liens satisfied, discharged
and released under the Plan shall execute any and all documentation reasonably
requested by the Debtors or the Reorganized Debtors evidencing the satisfaction,
discharge and release of such liens and such liens shall be deemed satisfied,
discharged and released by operation of this Order.
14. Revesting of Assets. On the Effective Date, the assets of the
-------------------
Debtors shall vest in the Reorganized Debtors. Thereafter, the Reorganized
Debtors may operate their businesses and may use, acquire, and dispose of
property free of any restrictions of the Bankruptcy Code, the Bankruptcy Rules
and the Court. All property of the Reorganized Debtors shall be free and clear
of all Claims and Interests, and all such Claims and Interests shall be both
18
discharged and released to the Reorganized Debtors, except as specifically
provided in the Plan, the New Collateral Documents, the New Senior Secured
Credit Agreement, the New Senior Secured Notes, the Exit Facility, the Amended
Ventas Leases, the Tax Refund Escrow Agreement or any other Plan Document or any
documents or instruments executed in accordance therewith, or the Confirmation
Order.
15. Assumption and Rejection of Contracts and Leases. Subject to
------------------------------------------------
Section 5.04 of the Plan, on the Effective Date, all executory contracts and
unexpired leases, including the Five Ventas Leases as assumed and simultaneously
amended to become the Amended Ventas Leases, of the Estates shall be assumed by
the Debtors pursuant to the provisions of Sections 365 and 1123 of the
Bankruptcy Code, except: (i) any executory contract or unexpired lease that is
the subject of a separate motion filed pursuant to Section 365 of the Bankruptcy
Code by the Debtors prior to the Confirmation Date; (ii) such contracts or
leases as are listed on Exhibit 8 to the Plan Supplement filed by the Debtors on
or before the Effective Date; and (iii) all executory contracts or unexpired
leases rejected under the Plan or by order of the Court entered before the
Effective Date and not subsequently assumed pursuant to an order of the Court.
Any order entered after the Confirmation Date by the Bankruptcy Court, after
notice and hearing, authorizing the rejection of an executory contract or
unexpired lease (other than a contract or lease governed by Section 5.04 of the
Plan) shall cause such rejection to be a prepetition breach under Sections
365(g) and 502(g) of the Bankruptcy Code, as if such relief were granted and
such order were entered prior to the Confirmation Date. Any Claims arising out
of the rejection of executory contracts or leases (other than a contract or
lease governed by Section 5.04 of the Plan) must be filed with the Court within
the later of the time set by any Final Order rejecting such executory contract
or unexpired lease or 30 days after the Effective Date. Any Claims not
19
filed within such time will be forever barred from assertion against any of the
Debtors or Reorganized Debtors, their Estates and their property. Except as
provided in Section 5.04 of the Plan, the Reorganized Debtors shall pay allowed
cure amounts arising from the assumption of executory contracts or leases as
Administrative Claims under the Plan without the need for the filing of a proof
of claim by the claimant. In addition to the retention of jurisdiction provision
contained in Section 13.01 of the Plan and subject to the provisions thereof,
the Court expressly retains jurisdiction to resolve any disputes between the
Reorganized Debtors and a party to an executory contract or lease that is
assumed regarding the cure amount that is owed as a result of the assumption of
the contract or lease, which either party can seek to resolve by application to
the Court on or after forty-five (45) days after the Effective Date if the
parties are unable to resolve the dispute consensually.
16. General Authorizations. The Debtors and the Reorganized Debtors
----------------------
are authorized and empowered pursuant to Sections 105 and 1142(b) of the
Bankruptcy Code, and as applicable, Section 303 of the General Corporation Law
of the State of Delaware, 8 Del. Code (S) 303, and any other applicable state
---- ----
law to take any and all actions reasonably necessary to implement the
transactions contemplated by the Confirmation Order (including without
limitation transactions contemplated by the Plan and Plan Documents as confirmed
under the Confirmation Order), all without further corporate action or action by
(or vote of) directors or stockholders of the Debtors or Reorganized Debtors,
including, without limitation, the following: (a) to reconstitute the board of
directors of each Reorganized Debtor; (b) to amend the Reorganized Debtors'
respective certificates of incorporation and by-laws, including without
limitation to effectuate a change of name with respect to Reorganized Vencor and
certain of the other Reorganized Debtors, provided that any such amended
certificates of incorporation and
20
amended bylaws shall continue to prohibit the issuance of non-voting equity
securities; (c) to merge any or all of the Debtors; (d) to enter into, execute
and deliver the Exit Facility and the Plan Documents, including without
limitation the New Senior Secured Credit Agreement, the New Senior Secured
Notes, the New Collateral Documents, the Amended Ventas Leases, the Registration
Rights Agreement, the New Warrant Agreement and the Tax Refund Escrow Agreement;
(e) to adopt and implement the Long-Term Incentive Plan, the Restricted Share
Plan and the New Stock Option Plan, and to pay the Performance Bonuses and
Retention Bonuses, to the extent not previously authorized by the Court and/or
paid by the Debtors; and (f) to authorize the appropriate officers of the
Reorganized Debtors to execute any documents, instruments or agreements
necessary, and perform any act that is desirable or required to comply with the
terms and conditions of the Plan and consummation of the Plan, including all
documents necessary and appropriate to execute and consummate the Exit Facility.
Such actions are approved in all respects and shall be deemed to have occurred
and be effective on the Effective Date.
17. Subordination Rights. Subject to the provisions of Section 8.15
--------------------
of the Plan, as of the Effective Date, to the fullest extent permitted by
applicable law (including but not limited to subsections (a) or (c) of Section
510 of the Bankruptcy Code), all Claims against and Interests in the Debtors and
all rights and claims between or among creditors or holders of Interests
relating in any manner whatsoever to Claims against or Interests in the Debtors,
based on any subordination rights, either contractual, legal or equitable, shall
be terminated and discharged in the manner provided for in the Plan, and all
such Claims, Interests and rights so based and all such subordination rights to
which any Entity may be entitled shall be irrevocably waived by the acceptance
by such Entity of the Plan or of any distribution pursuant to the Plan.
21
18. Status of Corporate Indemnities. The continuance of the
-------------------------------
Corporate Indemnities by the Reorganized Debtors, as provided in Section 12.03
of the Plan, shall be authorized and approved in all respects without any
requirement of further action by stockholders or directors of any of the Debtors
or Reorganized Debtors.
19. No Post-Confirmation Amendment or Filing of Claims. Except as
--------------------------------------------------
otherwise provided herein or in the Plan, a Claim may not be filed or amended
after the Confirmation Date without the prior authorization of the Court and,
even with such Court authorization may be amended by the holder of such Claim
solely to decrease, but not to increase, the amount or priority of the Claim.
Except as otherwise permitted herein or in the Plan, a Claim filed or amended
alter the Confirmation Date shall be deemed disallowed in full and expunged
without any action by the Debtors or the Reorganized Debtors if prior Court
authorization has not been obtained.
20. Payment of Fees. As set forth in Section 14.07 of the Plan, all
---------------
fees payable pursuant to Section 1930 of Title 28 of the United States Code
shall be paid on or before the Effective Date, and to the extent required and
unless relieved of these obligations by further Order of the Court, shall be
paid until the Reorganization Cases are closed.
21. Retention of Jurisdiction. Notwithstanding confirmation of the
-------------------------
Plan or occurrence of the Effective Date, and except as specified in the Exit
Facility, this Court shall retain such jurisdiction as is legally permissible,
including, without limitation, for the purposes set forth in Section 13.01 of
the Plan and for the determination of cure amounts as described in this Order,
subject to the limitations set forth in Section 13.01 of the Plan.
22. Modification of Plan. Subject to Section 14.12 of the Plan,
--------------------
after the entry of this Order, the Reorganized Debtors may, upon order of the
Court, amend or modify the Plan in
22
accordance with Section 1127(b) of the Bankruptcy Code, or remedy any defect or
omission or reconcile any inconsistency in the Plan in such manner as may be
necessary to carry out the purpose and intent of the Plan, as modified by this
Order.
23. The treatment of Class 10 (Punitive Damage Claims) under the Plan
is hereby amended pursuant to Section 1127(b) of the Bankruptcy Code to provide
solely with respect to any Allowed Punitive Damage Claims that have been filed
in the State of Florida ("Florida Punitive Damage Claims") that such Claims
shall be treated as Class 3B Claims in an amount up to the lesser of (a) any
applicable state law limits with respect to such Claim or (b) the greater of (i)
$500,000 or (ii) three times any compensatory damages award (the "Punitive
Damage Amount"). To the extent that any judgment with respect to any Florida
Punitive Damage Claim exceeds the Punitive Damage Amount, the amount in excess
of the Punitive Damage Amount shall be treated as a Class 10 Claim and the
Claimant shall receive no payment for such excess amount.
24. Exemption from Securities Laws. The exemption from the
------------------------------
requirements of Section 5 of the Securities Act of 1933, 15 U.S.C. (S) 77e, and
any state and local law requiring registration for the offer or sale of a
security provided for in Section 1145 of the Bankruptcy Code shall apply to the
New Senior Secured Notes, the New Common Stock (including New Common Stock
issued under the Performance Plan), the New Warrants, and the New Stock Options
issued pursuant to the Plan.
25. Exemptions from Taxation. Pursuant to Section 1146(c) of the
------------------------
Bankruptcy Code: (1) the issuance, distribution, transfer or exchange of the New
Senior Secured Notes and the entry into the Exit Facility or (2) the making,
delivery or recording of any other instrument of transfer under, in furtherance
of, or in connection with, the Plan, including any mortgages, deeds
23
of trust, deed to secure debt, assignments or other instruments of transfer
executed in connection with any transactions arising out of, contemplated by or
in any way related to the Plan or this Confirmation Order (and including without
limitation the Security Documents, as defined in Schedule A, attached hereto)
granted by any of the Reorganized Debtors in favor of Xxxxxx Guaranty Trust
Company as Collateral Agent), shall not be subject to any document recording
tax, stamp tax, conveyance fee, intangibles or similar tax, mortgage tax, real
estate transfer tax, documentary transfer tax, mortgage recording tax or other
similar tax or governmental assessment, and the appropriate state and local
governmental officials or agents, including but not limited to the land title
recording officers of Alabama, Florida, Georgia, Minnesota, Oklahoma, Tennessee,
Virginia, and counties therein, and the City of New Orleans, Louisiana shall be,
and hereby are, ordered and directed to forego the collection of any such tax or
governmental assessment and to accept for filing and recordation any of the
foregoing instruments or other documents without the payment of any such tax or
governmental assessment.
26. Validity of Liens. The liens granted pursuant to the Exit
-----------------
Facility and the New Senior Secured Notes and the New Senior Secured Credit
Agreement shall be legal, valid and enforceable first priority liens, except as
otherwise provided in the Exit Facility, the New Senior Secured Credit Agreement
and the New Senior Secured Notes, and the documents to be executed and delivered
pursuant thereto shall constitute the legal, valid and binding obligations of
the Reorganized Debtors that are parties thereto.
27. References to Plan Provisions. The failure specifically to
-----------------------------
include or reference any particular provision of the Plan in this Confirmation
Order shall not diminish or
24
impair the effectiveness of such provision, it being the intent of the Court
that the Plan be confirmed in its entirety.
28. Confirmation Order Controlling. If there is any direct conflict
------------------------------
between the Plan and this Confirmation Order, the terms of this Confirmation
Order shall control.
29. Reversal. If any or all of the provisions of this Confirmation
--------
Order are hereafter reversed, modified or vacated by subsequent order of this
Court or any other Court, subject to Section 14.12 of the Plan, such reversal,
modification or vacatur shall not affect the validity or enforceability of the
acts or obligations incurred or undertaken under or in connection with the Plan
prior to the Debtors' receipt of written notice of such order including, without
limitation, the obligations and indebtedness created under the Exit Facility.
Notwithstanding any such reversal, modification or vacatur of this Confirmation
Order, but subject to Section 14.12 of the Plan, any such act or obligation
incurred or undertaken pursuant to, and in reliance on, this Confirmation Order
prior to the effective date of such reversal, modification or vacatur shall be
governed in all respects by the provisions of this Confirmation Order and the
Plan and all related documents or any amendments or modifications thereto.
30. No Stay of Confirmation Order. Pursuant to Bankruptcy Rule
-----------------------------
3020(e), this Order shall not be stayed and shall be effective upon entry on the
docket of this Court.
31. Applicable Non-Bankruptcy Law. To the extent provided in
-----------------------------
Sections 1123(a) and 1142(a) of the Bankruptcy Code, the provisions of this
Confirmation Order, the Plan or any amendments or modifications thereto shall
apply and be enforceable notwithstanding any otherwise applicable nonbankruptcy
law.
32. Dissolution of the Creditors' Committee. On the Effective Date,
---------------------------------------
the Creditors' Committee shall cease to exist and its members, employees or
agents (including
25
without limitation, attorneys, financial advisors, and any other professionals)
shall be released and discharged in their capacity as such from all further
authority, duties, responsibilities, and obligations related to, arising from or
in connection with the Reorganization Cases except with respect to: (i) any
matters pending before the Court to which the Creditors' Committee is a party,
until such objections or matters are resolved, (ii) all fee applications filed
or to be filed after the Effective Date pursuant to Section 330 of the
Bankruptcy Code by or on behalf of members of the Creditors' Committee or any
professionals employed by the Debtors or the Creditors' Committee, (iii)
effectuating consummation of the Plan and (iv) any post-confirmation
modifications to the Plan or the Confirmation Order.
33. Record Date for Distributions. The record date for determining
-----------------------------
the holders of the Senior Debt Claims and the Subordinated Noteholders, entitled
to receive distributions under the Plan shall be the Confirmation Date.
34. Distribution of New Common Stock and New Warrants. On the
-------------------------------------------------
Effective Date the Reorganized Debtors shall deliver all of the New Common Stock
and New Warrants to be distributed to the holders of Allowed Class 4, 5 and 7A
Claims to the Exchange Agent on behalf of such holders (or in the case of Ventas
Realty, Limited Partnership, any designee named by Ventas Realty, Limited
Partnership prior to the Effective Date) in accordance with the provisions of
Article VI of the Plan. Pursuant to Section 6.02 of the Plan, the Debtors have
designated Xxxxx Fargo Bank of Minnesota, NA. ("Xxxxx Fargo"), as the Exchange
Agent and the Court hereby approves the designation of Xxxxx Fargo as the
Exchange Agent. Holders of Allowed Claims in Classes 4 and 7A who do not
receive distributions of New Common Stock or New Warrants due to their failure
to comply with the procedural requirements of Article VI related to the
distribution of such securities shall be treated in the same manner as provided
in
26
Section 6.09 of the Plan for holders of Claims that cannot be located within one
(1) year of the Effective Date, and the distributions that would otherwise be
made to such holders shall instead be reallocated and distributed pro rata among
the remaining holders of Claims in the same Class.
35. Administrative Claims Bar Date. All applications for payment of
------------------------------
fees and expenses pursuant to Section 330 and 503(b) of the Bankruptcy Code
which were incurred before the Effective Date must be filed with the Court on or
before 4:00 p.m. (Eastern Standard Time) on the date that is the forty-five (45)
days after the Effective Date; provided however that the foregoing shall not
apply to the Class 5 Claim. Any Person who fails to file such an application
with the Court on or before such time and date shall be forever barred from
asserting such claim against any of the Debtors, the Reorganized Debtors, or
their property, and the holder thereof shall be enjoined from commencing or
continuing any action, employment of process or act to collect, offset or
recover such claim. Notwithstanding any prior order of this Court in these
Reorganization Cases, all requests for approval and payment of professional fees
and reimbursement of expenses, whether or not previously applied for by interim
application, may be included in such professionals' final applications for
payment of Claims as set forth herein and in the Plan. Objections, if any, to
such claims shall be filed and served not later than five (5) business days
prior to the date set by the Court for the hearing to consider such claims.
36. Allowance of Malpractice and Other Litigation Claims. The
----------------------------------------------------
Debtors and/or Reorganized Debtors shall file an objection to and/or contest the
allowance of the Malpractice and Other Litigation Claims on or before the
expiration of one-hundred and twenty (120) days from the Effective Date
(hereinafter the "Objection Deadline"). Failure of the Debtors or Reorganized
Debtors to file a objection to a Malpractice and Other Litigation Claim on or
before the expiration of the Objection Deadline shall constitute the allowance
of the Malpractice and
27
Other Litigation Claim subject only to the liquidation of the Malpractice and
Other Litigation Claim in a court of competent jurisdiction. Further, upon the
occurrence of either the filing of the objection to a Malpractice and Other
Litigation Claim by a Debtor or Reorganized Debtor or the deemed allowance of
the claim, the automatic stay of 11 U.S.C. (S) 362 shall be lifted and the
claimant shall be authorized to take all steps necessary to liquidate the
Malpractice and Other Litigation Claim; provided however, that (i) the
liquidation of the Malpractice and Other Litigation Claim shall be undertaken
solely for the purpose of liquidating the claimant's Malpractice and Other
Litigation Claim against the Debtors for purposes of receiving distributions
under the Plan, and/or receiving such insurance proceeds as may be available to
such claimant with respect to such claim; and (ii) the Court shall retain
jurisdiction over the Malpractice and Other Litigation Claims to resolve any
disputes that may arise between the Debtors, the Reorganized Debtors and the
claimants regarding the liquidation of the Malpractice and Other Litigation
Claims and the payment of distributions under the Plan for such claims, subject
to the restrictions on jurisdiction contained in 28 U.S.C. (S) 157.
37. Nothing herein shall be deemed to limit or otherwise preclude a
Debtor and a holder of a Malpractice and Other Litigation Claim from resolving a
Malpractice and Other Litigation Claim by settlement. In addition, to the extent
that a Malpractice and Other Litigation Claim is resolved for an amount, the
payment of which comes exclusively from the Debtors' and/or Reorganized Debtors'
insurance carriers, then no further order or intervention by the Court is
required.
38. The Debtors and Reorganized Debtors reserve the right to seek a
further order of the Court establishing a mediation or alternative dispute
resolution procedure for the liquidation of the Malpractice and Other Litigation
Claims arising in those states in which
28
mediation and/or alternative dispute resolution procedures are not a mandatory
element of the state court process.
39. Indenture Trustee Fees. To the extent that, as of the Effective
----------------------
Date, any pending Administrative Expense Claims of the Indenture Trustees
(including a good faith estimate provided to the Debtors by each of the
Indenture Trustees of its fees and expenses accruing through the Effective
Date), are not yet allowed, the Debtors shall establish on the Effective Date a
separate Cash reserve (the "Indenture Trustees Reserve") for the Indenture
Trustees in the amount of any such outstanding Administrative Expense Claims
including the estimated fees and expenses.
40. The obligation of the Reorganized Vencor to pay the Indenture
Trustees their fees and expenses shall be secured by the amounts in the
Indenture Trustee Reserve established for the Indenture Trustees and the lien
rights of the Indenture Trustees under the respective indentures governing the
Subordinated Notes shall be deemed to attach to the Cash in the Indenture
Trustee Reserve to the same extent as if the Cash in the Indenture Trustees
Reserve were property received by the Indenture Trustees pursuant to the Plan.
The Indenture Trustees shall be conclusively deemed to have taken any and all
action required to perfect their lien rights as to the Cash in the Indenture
Trustees Reserve, including, without limitation, any requirement of possession
for such perfection.
41. In consideration for the foregoing, and subject to the
establishment of the Indenture Trustee Reserve, the Indenture Trustees are
deemed to have waived their lien rights in the property to be distributed under
the Plan to the holders of the Subordinated Notes. Upon the payment by the
Debtors or Reorganized Vencor of the Allowed Administrative Expenses Claims
29
of the Indenture Trustees the lien rights of the Indenture Trustees in the
Indenture Trustee Reserve shall be extinguished.
42. Transfer of Ventas Claims. Any transfer of a Class 5 Claim held
-------------------------
by a Ventas Entity shall be effective and recognized for distribution purposes
of the Plan upon the filing with the Clerk of the Bankruptcy Court by the
respective Ventas Entity of a notice of the transfer.
43. Post-Confirmation Notices. On or before the tenth (10) Business
-------------------------
Day following the date of the entry of this Confirmation Order, the Debtors or
the Reorganized Debtors, as appropriate, shall serve notice of entry of this
Confirmation Order pursuant to Bankruptcy Rules 2002(f)(7), 2002(k) and 3020(c)
to all creditors, indenture trustees and equity security holders of the Debtors
as of the date hereof
44. Subject to Section 14.12 of the Plan, the form of the Amended
Ventas Leases (as appropriately conformed for each master lease portfolio as
described in the form admitted as an exhibit at the Confirmation Hearing), the
Excess Stock Trust Agreement, the Tax Refund Escrow Agreement, the Registration
Rights Agreement, the New Senior Secured Notes, the New Senior Secured Credit
Agreement and the Amended and Restated Certificate of Incorporation shall be
substantially in the forms submitted as exhibits at the Confirmation Hearing or
in the case of the Registration Rights Agreement, filed with the Court, and
shall be executed and delivered on the Effective Data.
45. If the Effective Date does not occur, this Order shall be deemed
vacated and of no force and effect.
46. Postpetition Claims. Notwithstanding any provision of the Plan,
-------------------
for any Claims arising on or after the Petition Date that represent liabilities
incurred by the Debtors in the ordinary course of business during these
Reorganization Cases the Debtors shall remain
30
obligated to pay such Claims as and when they become due and payable in the
ordinary course of business, without the need for Filing an application with the
Court before the bar date for Administrative Claims or at any other time and
without regard to the terms of or any limitation of the Plan, and in accordance
with the terms and conditions of any judgment, award or agreement relating
thereto; this paragraph specifically applies without limitation to Postpetition
Personal Injury Claims alleged against the Debtors that arose on or after the
Petition Date which may be determined, liquidated and resolved in the ordinary
course of business. Holders of Postpetition Personal Injury Claim are authorized
to liquidate such Claims to judgment, settlement or otherwise without further
order of the Court and to seek payment as set forth herein.
Dated: Wilmington, Delaware
March 16, 0000
/x/ Xxxx X. Xxxxxxx
-----------------------------------
XX0XXX XXXXXX BANKRUPTCY JUDGE
31
SCHEDULE A
TO
EXHIBIT H
SCHEDULE A
Security Documents
"Security Documents" shall mean: leasehold and fee mortgages,
assignments of leases and rents, security agreements, fixture filings and
financing statements; leasehold and fee deeds of trust, assignments of leases
and rents, security agreements, fixture filings and financing statements;
leasehold and fee deeds to secure debt, assignments of leases and rents,
security agreements, fixture filings and financing statements; UCC-[1] financing
statements with respect to the foregoing instruments; and UCC-[2] fixture
filings with respect to the foregoing instruments.
This schedule is intended to include all Security Documents relating
to property that is owned or leased by Vencor, Inc. or Vencor Operating, Inc.
located in any of the following jurisdictions:
--------------------------------------------------------------------------------
Alabama Arizona Arkansas
------- ------- --------
Jefferson Maricopa Pulaski
Madison Pima
Mobile Yavapai
--------------------------------------------------------------------------------
California Colorado Connecticut
---------- -------- -----------
Alameda Arapahoe Fairfield
Bakersfield Xxxxx Hartford
Xxxx Denver New London
Los Angeles
Orange
Riverside
Sacramento
San Bernardino
San Diego
San Francisco
San Xxxx Obispo
San Xxxxxxx
San Mateo
Xxxxxx
Xxxxxxx
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Delaware Florida Georgia
-------- ------- -------
Brevard Xxxx
Broward Chatham
Xxxx Xxxxxxx
Dade Xxxx
Palm Beach De Xxxx
Pinellas Fayette
Xxxxxxxx Xxxxxx
Hillsborough Houston
Xxx Xxxxxxxxxx
Manatee
Pasco
Sarasota
Seminole
--------------------------------------------------------------------------------
Idaho Illinois Indiana
----- -------- -------
Xxx Xxxx Xxxxx
Boise De Xxxx Xxxxxxxxxx
Canyon Xxxxx
Gem Delaware
Latah Elkhard
Ney Xxxxx Xxxxx
Shoshone Xxxxxxxx
Xxxxxxxxxx Xxxxxx
Xxxxxxxx
LaGrange
Xxxxxx
Xxxxxxxx
Vanderburgh
Vigo
Xxxxx
--------------------------------------------------------------------------------
2
--------------------------------------------------------------------------------
Iowa Kansas Kentucky
---- ------ --------
Xxxxx
Xxxxx
Xxxxx
Davies
Xxxxxxx
Xxxxxx
Xxxxxxxxx
Xxxxxxxx
Xxxxxx
XxXxxx
Xxxxxx
Xxxxxx
--------------------------------------------------------------------------------
Louisiana Maine Massachusetts
--------- ----- -------------
Caddo Parish Kennebec Barnstable
Orleans Parish Xxxx Berkshire
Saint Tammany Parish Lincoln Bershire
Oxford Bristol
Penobscot Essex
Sagadahoc Franklin
York High Street
Lancaster
Middlesex
Norfold
Plymouth
Stoughton
Suffolk
West Roxbury
Worcester
--------------------------------------------------------------------------------
Michigan Minnesota Mississippi
-------- --------- -----------
Xxxxx Hennepin Xxxxxx
Xxxxxx
--------------------------------------------------------------------------------
Missouri Minnesota Nebraska
-------- --------- --------
Xxxx Beaverhead Lancaster
Xxxxxxx Cascade
St. Louis
--------------------------------------------------------------------------------
3
--------------------------------------------------------------------------------
Nevada New Hampshire New Jersey
------ ------------- ----------
Clark Hanover
Hillsborough
Merrimack
Strafford
--------------------------------------------------------------------------------
New Mexico North Carolina Ohio
---------- -------------- ----
Bernalillo Almance Coshocton
Buncombe Fairfield
Duplin Xxxxxxxx
Xxxxxx Guernsey
Forsyth Xxxxxxx
Xxxxxx Lake
Guilford Licking
Halifax Xxxxx
Hertford Xxxxxx
Xxxxxx Xxxx
Xxxxxxx Summit
Mecklenburg Xxxxxx
Xxxx Washington
New Hanover
Orange
Pasquotank
Union
Xxxxx
Wake
--------------------------------------------------------------------------------
Oklahoma Oregon Pennsylvania
-------- ------ ------------
Oklahoma Xxxxxxx Allegheny
Xxxxxx Xxxxx
Northampton
Philadelphia
--------------------------------------------------------------------------------
Puerto Rico Rhode Island South Carolina
----------- ------------ --------------
Providence
--------------------------------------------------------------------------------
4
--------------------------------------------------------------------------------
Tennessee Texas Utah
--------- ----- ----
Davidson Bexar Xxxxx
Xxxxxxxx Xxxxxx Washington
Xxxxxx Xxxxxx Salt Lake
Xxxxxx Xxxxxxx
--------------------------------------------------------------------------------
Vermont Xxxxxxxx Xxxxxxxxxx
------- -------- ----------
Chittenden Arlington Xxxxx
Princess Xxxx Cowlitz
Suffolk Xxxx Xxxxxx
Snohomish
Whatcom
--------------------------------------------------------------------------------
Wisconsin Wyoming
Xxxxx Carbon
Kenosha Fremont
Langlade Laramie
Manitowoc Sweetwater
Marathon
Milwaukee
Outgamie
Racine
Winnebago
Wood
--------------------------------------------------------------------------------
5
EXHIBIT B
TO
EXHIBIT H
Docket for Case NoDocket Number: 99-03199-MFW VENCOR, INC.
Case Information
341 Meeting: 10/22/99, 11:00 A.M. at location #10
Claim Deadline: 01/07/00 523(c) Complaint Deadline: Not Applicable
District: DELAWARE [District Code 0311]
Office: U.S. BANKRUPTCY COURT [1]
Original Filing Date: 09/13/99 Original Chapter: 11
Judge: Xxxx X. Xxxxxxx [AO Code A591]
Type of Filing: Voluntary Nature of Debt: Business
Assets available for distribution to creditors.
Fee of $830.00 paid in full.
Debtor Information
Type of Filing: Corporation
Debtor
------
VENCOR, INC.
DBA VENCOR HEALTHCARE, INC.
SSN: not available EIN: 00-0000000
Address:
One Vencor Place, 000 X. Xxxxxx Xx.
XXXXXXXXXX, XX 00000-0000
County: Jefferson KY [21111]
Attorney Information
Attorney for Debtor:
-------------------
Xxxxxxx X. Xxxxxx, Xx.
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
(000) 000-0000
Trustee:
-------
NOT YET APPOINTED
Trustee's Attorney: None assigned.
------------------
Creditor's Attorney: None assigned.
-------------------
Statistical Information
Estimated Number of Creditors: 1000 or more
Estimated Assets: $10,000,001 to 50 Million
Estimated Liabilities: $10,000,001 to 50 Million
Form of business organization: Not Available
Type of business: Not Available
Number of employees: N/A
Number of equity security holders: N/A
Receipt Number: 040284
Docket for Case No. 99-03199-MFW
--------------------------------
VENCOR, INC. (printed 04/23/01 at 14:17)
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/16/01 5973 CERTIFICATION of Xxxxxxx X. Xxxxxxxx, Esq. & Request for
Modification of Page 7, (P) 20 & Page 17, (P) 10 of Finding of Fact,
Conclusion of Law & Order Confirming Fourth Amended Plan (Filed by
Xxxxxxx X. Xxxxxxxx, Atty./Realtor XXX-XXX XXXXXXXX-XXXXX.) Re: Item # 5950.
[EOD 03/19/01] [JW]
03/16/01 5974 OMNIBUS Objection (TENTH) to Claims (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) [EOD 03/19/01] [JW]
NOTICE of Motion and Hearing (Hearing only if objections filed by
4/5/01 @ 4:00PM) on 04/25/01 at 02:00 P.M. at 000 Xxxxxx Xxxxxx, 0xx Xxxxx,
Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 [EOD 03/19/01] [JW]
CERTIFICATE of Service [EOD 03/19/011 [JW]
03/16/01 5975 ORDER Signed and Located in Original Document Confirming Chapter 11
Plan Re: Item # 5950. [EOD 03/19/01] [JW]
03/16/01 5976 MOTION for Order Compelling Payment of Post-Petition Administration
Obligation (Filed by Xxx Xxxxxx Xxxxxxxxx, Atty./AREA METROPOLITAN
AMBULANCE Authority, d/b/a MedStar.) [EOD 03/19/01] [JW)
CERTIFICATE of Service [EOD 03/19/01] [JW]
3/16/01 5977 MOTION for Leave to File Proof of Claim (Filed by Xxx Xxxxxx Xxxxxxxxx,
Atty./AREA METROPOLITAN AMBULANCE AUTHORITY, d/b/a MedStar.) [EOD
03/19/01] [JW]
CERTIFICATE of Service [EOD 03/19/01] [JW]
03/16/01 5978 NOTICE of Motion and Hearing (Hearing only if objections filed by
4/6/01 @ 4:00PM) on 04/12/01 at 02:00 P.M. at 000 Xxxxxx Xxxxxx, 0xx
Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 Re: Item # 5976. [EOD
03/19/01] [JW]
03/16/01 5979 NOTICE of Motion and Hearing (Hearing only if objections filed by
4/6/01 @ 4:00PM) on 04/12/01 at 02:00 P.M. at 000 Xxxxxx Xxxxxx, 0xx
Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 Re: Item # 5977. [EOD
03/19/01] [JW]
03/16/0l 5980 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxxxx X. Xxxxx, Esq.)
[EOD 03/19/01] [JW]
03/16/01 5981 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxx X. Xxxxxx, Esq.)
[EOD 03/19/01] [JW]
2
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/16/01 5982 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxx X. Xxxxxx, Esq.)
[EOD 03/19/01] [JW]
03/19/01 5983 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx X. Xxxxxxxx, Esq.)
[EOD 03/20/01] [JW]
03/19/01 5984 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx X. Xxxxxx, Esq.)
[EOD 03/20/01] [JW]
CERTIFICATE of Service [EOD 03/20/01] [JW]
03/19/01 5985 NOTICE of Hearing (Filed by Xxxxx X. Xxxxx, Atty./HSBC BANK USA, as
Indenture Trustee.) on 03/30/01 at 09:30 A.M. at 000 Xxxxxx Xxxxxx, 0xx
Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 Re: Item 5522. [EOD 03/20/01]
[JW]
CERTIFICATE of Service [EOD 03/20/01] [JW]
03/19/01 5986 NOTICE of Withdrawal of Proofs of Claim (Filed by Xxxxx Xxxxx-Xxxxxxxx,
Atty./EXCELSIOR CARE CENTERS, INC.) [EOD 03/20/01] [JW]
CERTIFICATE of Service [EOD 03/20/01] [JW]
03/19/01 5987 NOTICE of Transfer of Claim (Filed by Xxxxxx XxXxxxx/Liquidity
Solutions, Inc.) (Medical Packaging, Inc./Liquidity Solutions, Inc.)
[EOD 03/22/01] [JW]
03/20/01 5988 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice FLOWERS BAKING ATTN XXXX X XXXXX XX. [EOD 03/23/01] [SBM]
03/20/01 5989 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice SPARTANBURG NEUROLOGICAL SERVICES [EOD 03/23/01] [SBM]
03/20/01 5990 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice DBA SPECIAL MED RENTALS SPECIAL [EOD 03/23/01] [SBM]
03/20/01 5991 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice RESPIRATIORY CARE INC [EOD 03/23/01] [SBM]
03/20/01 5992 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice WAL MART INC ATTN XXXX XXXXXXX [EOD 03/23/01] [SBM]
03/20/01 5993 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice GRUNAU ATTN: XXXXXXXXX X. XXXXXX [EOD 03/23/01] [SBM]
03/20/01 5994 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice JET MEDICAL ELECTRONICS INC ATTN XXXXX XXXXXXXXX [EOD 03/23/01]
[SBM]
3
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/20/01 5995 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice C&C WASTE CONTROL ATTN: CTRANE X X XXXXX [EOD 03/23/01] [SBM]
03/20/01 5996 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice DESERT COUNTY LIGHTING ATTN: XXXXXXX XXXXXXXXX [EOD 03/23/01]
[SBM]
03/20/01 5997 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice XXXXX GLASS ATTN XXX XXXXX [EOD 03/23/01] [SBM]
03/20/01 5998 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice CAMBRIDGE NUTRACEUTICALS ATTN: XXXX [EOD 03/23/01] [SBM]
03/20/01 5999 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice XXXX XXXXXXXX [EOD 03/23/01] [SBM]
03/20/01 6000 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice HOSPITAL WORKERS LOCAL 285 ATTN XXXXX XXXXXX [EOD 03/23/01]
[SBM]
03/20/01 6001 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice APA MEDICAL ATTN XXXXXX XXXX [EOD 03/23/01] [SBM]
03/20/01 6002 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice PRESIDIO GORDENS ATTN XXXXX XXXXX [EOD 03/23/01] [SBM]
03/20/01 6003 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice XXXX-XXX MEATS INC ATTN XXX XXXX [EOD 03/23/01] [SBM]
03/20/01 6004 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice ROTO ROOTER PLUMBING ATTN: XXXX XXXXXX [EOD 03/23/01] [SBM]
03/20/01 6005 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice MAYFAIR DIAGNOSTIC LAB ATTN XXXXXXX J LAW [EOD 03/23/01] [SBM]
03/20/01 6006 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice THE EMPLOYMENT TIMES ATTN XXXX GRAIGS [EOD 03/23/01] [SBM]
03/20/01 6007 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice RESTAURANT APPLIANCE SERVICE [EOD 03/23/01] [SBM]
4
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/20/01 6008 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice BIO-TECH SYSTEMS ATTN: XXXXXX X XXXXXX [EOD 03/23/01] [SBM]
03/20/01 6009 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice PM REFUSE REMOVAL SERV INC ATTN XXXXXX XXXXXXX [EOD 03/23/01]
[SBM]
03/20/01 6010 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice GRAINGER ATTN H. F. HAEGERSCH [EOD 03/23/01] [SBM]
03/20/01 6011 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice RMS CALIBRATION ATTN XXXX X. XXXXXXXX [EOD 03/23/01] [SBM]
03/20/01 6012 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice HARKERS WHOLESALE MEAT ATTN: XXXXX X XXXX [EOD 03/23/01] [SBM]
03/20/01 6013 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice SUPPLEMENTAL HEALTH CARE SERV ATTN: XXXXXX XXXXX [EOD 03/23/01]
[SBM]
03/20/01 6014 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice ARTHREX [EOD 03/23/01] [SBM]
93/19/01 6015 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice BEST CHOICE ATTN XXXXX X XXXX [EOD 03/23/013] [SBM]
03/19/01 6016 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice XXXXX XXXX 3 VILLA JARDIN [EOD 03/23/01] [SBM]
03/19/01 6017 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice GRUNAU COMPANY INC. ATTN: XXXXXXXXX X. XXXXXX [EOD 03/23/01]
[SBM]
03/19/01 6018 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice XXXXX ELECTRIC [EOD 03/23/01] [SBM]
03/19/01 6019 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice CONCORD EXTENDED CARE [EOD 03/23/01] [SBM]
03/l9/01 6020 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice THE VETERAN SERVER ATTN XXX XXXXX [EOD 03/23/01] [SBM]
03/l9/01 6021 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice Wise Uniforms & Equipment ATTN: XXXXX XXXX [EOD 03/23/01]
[SBM]
5
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/19/01 6022 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice DUPONT FLOORING SYSTEMS ATTN: XXXX XXXXXXXXX [EOD 03/23/01]
[SBM]
03/19/0l 6023 NOTICE of Transfer of Claim Other Than for Security and Waiver of
Notice COMPLETE FLOORING ATTN XXXXX XXXXXX [EOD 03/23/01] [SPM]
03/23/0l 6023A THE ABOVE TRANSFERS OF CLAIM WERE FILED By Madison Creditors Liquidity
Investors 202, LLC (TRANSFEREE) 5988 thru 6023 [EOD 03/23/01] [JW]
03/13/01 6024 ORDER Signed and Located in Original Document Vacating in Part the
Order Reducing or Disallowing Certain Claims Re: Item # 5706. [EOD
03/26/01] [JW] & Re: Item # 5226. [EOD 03/26/01] [JW]
03/19/01 6025 ORDER Signed and Located in Original Document (Shortening Notice) Re:
Item # 5963. [EOD 03/26/01] [JW]
03/20/01 6026 Line Withdrawing Proof of Claim # 5127 (Filed by Xxxxxxx Xxxxx Xxxxx,
Atty./AJILON SERVICES, INC.) [EOD 03/26/01] [JW] CERTIFICATE of Service
[EOD 03/26/01] [JW]
03/20/01 6027 CERTIFICATION of No Objection (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) Re: Item # 5792.[EOD 03/26/01] [JW]
03/20/01 6028 STIPULATION AND ORDER Settling Fifth Omnibus Objection to Claims
w/Respect to First Colony Levee Improvement District, First Colony
Municipal Utility District #9 & The City of Missouri City (Filed by
Xxxx X. Xxxxxxxx, Atty./DEBTORS & Xxxx X. Xxxxxx, Atty./FIRST COLONY
LEVEE IMPROVEMENT DISTRICT, ET AL.) Re: Item # 3094. [Disposed] [EOD
03/26/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/20/01 6029 STIPULATION AND ORDER Settling Fifth Omnibus Objection to Claims
w/Respect to Manatee County Tax Collector (Filed by Xxxxxxx X.
Xxxxxxxxx, Esq., Atty./DEBTORS & Xxx Xxxxxx, Jr., Atty./MANATEE COUNTY
TAX COLLECTOR.) Re: Item # 3094. [Disposed] [EOD 03/26/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD Oat 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/20/01 6030 CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. Regarding Order Further
Extending Time Debtors' Must Assume/Reject Unexpired Leases Re: Item #
5785. [Disposed] [EOD 03/26/01] [JW]
6
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/21/01 6031 NOTICE of Appearance and Request for Service of Notices and Documents
(Filed by Xxxxx X. Xxxxxxxx, Atty./XXXXX X. XXXXXXXX, n/k/a Xxxxx X.
Xxxxxxx.) [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/21/01 6031A OBJECTION to Eighth Omnibus Objection to Claims (Filed by Xxxxx X.
Xxxxxxxx, Atty./XXXXX X. XXXXXXXX, n/k/a Xxxxx X. Xxxxxxx.) Re: Item #
4989. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/21/01 6032 MOTION for Order Vacating in Part Order Reducing or Disallowing Certain
Claims (Omnibus Objection # 9) (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) Re: Item # 5924. [EOD 03/26/01] [JW]
NOTICE of Motion (Hearing only if objections filed by 4/9/01 @ 4:00PM)
CEOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/21/01 6033 CERTIFICATION of No Objection (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) Re: Item # 5797. [EOD 03/26/01] [JW]
03/21/01 6034 STIPULATION AND ORDER Regarding Claims of Xxxxx Environmental & Energy
Services Company (Filed by Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS &
Xxxxxxxxxxx Xxxxxxxxx, Atty./XXXXX ENVIRONMENTAL ENERGY SERVICES CO.,
INC.) [Disposed] [EOD 03/26/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/21/01 6035 STIPULATION AND ORDER Regarding Extension of Discovery Period (Filed by
Xxxxxxxxxxx X. Xxxxxx, Atty./IRS & Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) Re: Item # 3094. [Disposed] [EOD 03/26/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/21/01 6036 NOTICE of Service Re: Item # 5967. [EOD 03/26/01] [JW]
& Re: Item # 5968. [EOD 03/26/01] [JW]
& Re: Item # 5960. [EOD 03/26/01] [JW]
& Re: Item #s 5970, 5971 & 5972 [EOD 03/26/01] [JW]
7
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/22/01 6037 POST-PETITION Claim for Damages for Tortious Violation of Americans
w/Disabilities Act of 1990 (Filed by Xxxxxxx X. Xxxxx, Atty./XXXXXXXX
XXXXXXXX.) [EOD 03/26/01] [JW]
DECLARATION of Service [EOD 03/26/01] [JW]
03/22/01 6038 APPLICATION for Compensation and for Reimbursement of Expenses (Xxxx
Xxxxx LLP) (Filed by Jan A. T. van Amerongen, Jr., Atty./DEBTORS.)
SIXTEENTH INTERIM 1/1/01 thru 1/31/01 [EOD 03/26/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/11/01 @
4:00PM) [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/22/01 6039 APPLICATION for Compensation and for Reimbursement of Expenses (Mintz,
Levin, Cohn, Ferris, Glovsky & Popeo, P.C.) (Filed by Xxxxxxx X. Xxxxx,
Atty./DEBTORS.) TWELFTH 12/1/00 thru 12/31/00 [EOD 03/26/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/12/01 @
4:00PM) [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/22/01 6040 APPLICATION for Compensation and for Reimbursement of Expenses (Mintz,
Levin, Cohn, Ferris, Glovsky & Popeo, P.C.) (Filed by Xxxxxxx X. Xxxxx,
Atty./DEBTORS.) THIRTEENTH 1/1/01 thru 1/31/01 [EOD 03/26/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/12/01 @
4:00PM) [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/22/01 6041 OBJECTION to Motion to File Claims Beyond Bar Date (Filed by Xxxxxxx X.
Xxxxxx, Atty./DEBTORS.) Re: Item # 4933. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
P3/22/01 6042 DECLARATION of Xxxxxx X. XxXxxxxx, Director & Corporate Counsel of
Liability Claims for Vencor, Inc. In Support of Debtors' Objection to
Motion to File Claims Beyond Bar Date Re: Item # 6041. [EOD 03/26/01]
[JW]
& Re: Item # 4933. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
8
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
93/22/01 6043 DECLARATION of Xxxxxx X. XxXxxxxx, Director & Corporate Counsel of
Liability Claims for Vencor, Inc. In Support of Debtors' objection to
File Proof of Claim Beyond Bar Date Re: Item # 6041. [EOD 03/26/01] [JW]
& Re: Item # 4933. [EOD 03/26/01] [JW] 3/27
03/23/01 6044 WITHDRAWAL of Appearance & Removal from 2002 Service List (Filed by
Xxxxxxxx X. Xxxxxxxxx, Atty./XXXXXXXX X. XXXXXXXX.) Re: Item # 639.
[Eon 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/23/01 6045 APPLICATION for Compensation and for Reimbursement of Expenses (Cleary,
Gottlieb, Xxxxx & Xxxxxxxx) (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) FIFTEENTH INTERIM 12/1/00 thru 12/31/00 [EOD 03/26/01]
[JW]
03/23/01 6046 NOTICE of Application (Hearing only if objections filed by 4/12/01 @
4:00PM) Re: Item # 6045. [EOD 03/26/01] [JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/23/01 6047 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx X. Xxxxx, Esq.)
[EOD 03/26/01] [JW]
03/23/01 6048 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx X. Xxxxxxx, Esq.)
[EOD 03/26/01] [JW]
03/23/01 6049 MOTION for Relief from Stay (Filed by Xxxxx X. Xxxxxx, Atty./XXXXX
XXXXX PRIDE.) [EOD 03/26/01] [JW]
NOTICE of Motion and Hearing on 04/12/01 at 02:00 P.M. at 000 Xxxxxx
Xxxxxx, 0xx Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 [EOD 03/26/01]
[JW]
CERTIFICATE of Service [EOD 03/26/01] [JW]
03/23/01 6050 RESPONSE to Motion to Reduce or Disallow Claim (Filed by Xxxx X.
Xxxxxxx, Treasurer/Grant County.) [EOD 03/27/01] [JW]
03/26/01 6051 LETTER In Response to Notice of Objection to Claims (Filed by Xxxxxxx
X. Xxxxxxxxxxx, Pres./FACTORY SERVICE AGENCY INC.) [EOD 03/27/01] [JW]
03/26/01 6052 RESPONSE to Reclassifying Claim as Amended Claim Disallowing any Relief
(Filed by Xxxxxx Xxxx/SUPERIOR BIOMEDICAL SERVICE, INC.) [EOD 03/27/01]
[JW]
03/26/01 6053 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxxx X. Xxxxxxxx,
Esq.) [EOD 03/27/01] [JW]
03/26/01 6054 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx Xxxxxx, Esq.) [EOD
03/27/01] [JW]
9
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/26/01 6055 TRANSCRIPT of Hearing 3/15/01 [EOD 03/27/01] [JW]
03/26/01 6056 NOTICE of Service Re: Item # 5830. [EOD 03/27/01] [JW]
03/26/01 6057 NOTICE of Service Re: Item # 5950. [EOD 03/27/01] [JW]
03/26/01 6058 CERTIFICATION of No Objection (Filed by Xxxxx X. Xxxxxx, Atty.
/OFFICIAL COMMITTEE/UNSECURED CREDITORS.) Re: Item # 5898. [EOD
03/27/01] [JW]
03/26/01 6059 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxxx X. Xxxxx, Esq.)
[EOD 03/27/01] [JW]
03/26/01 6060 STIPULATION AND ORDER Settling Fifth Omnibus Objection to Claims
w/Respect to Canyon County Treasurer (Filed by Xxxxxx Xxxxx,
Treasurer/CANYON COUNTY & Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS.) Re:
Item # 3094. [Disposed] [EOD 03/27/01] [JW]
CERTIFICATE of Service [EOD 03/27/01] [JW]
03/27/01 6061 NOTICE of Withdrawal of Transfer of Claim (B G Chemicals, Inc.) (Filed
by Xxxxxx X. Xxxxxxx/DEBT ACQUISITION COMPANY OF AMERICA V, LLC.) Re:
Item # 4618. [EOD 03/27/01] [JW]
03/27/01 6062 WITHDRAWAL of Proof of Claim #8497 (Filed by Xxxxxx X. Xxxxxx,
Atty./ADA COUNTY TREASURER.) [EOD 03/27/01] [JW]
CERTIFICATE of Service [EOD 03/27/01] [JW]
03/27/01 6063 WITHDRAWAL of Administrative Expense Claim Dated 1/12/01 ($1,996.88)
(Filed by Xxx Xxxxxxxxx, Revenue Agent/WISCONSIN DEPT./REVENUE.) [EOD
03/29/01] [JW]
03/27/01 6064 CERTIFICATE of Service Re: Item # 6045. [EOD 03/29/01] [JW]
03/27/01 6065 STIPULATION AND ORDER Settling Fifth Omnibus Objection to Claims
w/Respect to Madison County Tax Collector (Filed by Xxxx X. Purbach,
Atty./MADISON COUNTY TAX COLLECTOR & Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) Re: Item # 3094. [Disposed] [EOD 03/29/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS.) [EOD 03/29/01]
[JW]
10
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/27/01 6066 CERTIFICATION of Counsel w/Respect to Amended Order Approving Entry
Into Contract for Transfer of Operations of Facility Known as MONTVUJE
& Authorizing Assumption & Assignment of Related Executory Contracts
(Filed by Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS.) Re: Item # 5968.
[Disposed] [EOD 03/29/01] [JW]
& Re: Item # 5782. [EOD 03/29/01] [JW]
CERTIFICATE of Service [EOD 03/29/01] [JW]
/27/oh 6067 COUNSEL'S Agenda with Matters Scheduled on 03/30/01 at 09:30 A.M. at
000 Xxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 [EOD
03/29/01] [JW]
8/01 6068 NOTICE of Withdrawal of Appearance (Filed by Xxxxxxx X. Xxxx,
Atty./NATIONAL HEALTHCARE INVESTORS, INC.) Re: Item # 904. [EOD
03/29/01] [JW]
13/28/01 6069 COUNSEL'S Agenda with Matters Scheduled (AMENDED) on 03/30/01 at 09:30
A.M. at 000 Xxxxxx Xxxxxx, 0/xx/ Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX
00000 Re: Item # 5057. [EOD 04/02/01] [JW]
3/29/01 6070 STIPULATION AND ORDER Settling Second Omnibus Objection to Claims
w/Respect to Travelers Indemnity Company (Filed by Xxxx X. Xxxxxx, III,
Atty./TRAVELERS INDEMNITY COMPANY & Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) Re: Item # 1503. [Disposed] [EOD 04/02/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD 04/02/01] [JW]
CERTIFICATE of Service [EOD 04/02/01] [JW]
03/29/0l 6071 APPLICATION for Compensation and for Reimbursement of Expenses (Morris,
Nichols, Arsht & Xxxxxxx) (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) SIXTEENTH INTERIM 2/1/01 thru 2/18/01 [EOD 04/02/01]
[JW]
NOTICE of Application (Hearing only if objections filed by 4/19/01 @
4:00PM) [EOD 04/02/01] [JW]
CERTIFICATE of Service [EOD 04/02/01] [JW]
03/30/01 6072 RESPONSE to Tenth Omnibus Objection to Claims #8590, 8591, 03142 & 7113
(Filed by Xxxx X. Xxxxxxxx, Atty./MISSOURI DEPT./REVENUE.) Re: Item #
5974. [EOD 04/02/01] [JW]
CERTIFICATE of Service [EOD 04/02/01] [JW]
11
Filing Date No. Entry
----------------------------------------------------------------------------------------------------------------
03/30/01 6073 OMNIBUS Objection (ELEVENTH) to Claims (Filed by Xxxx X. Xxxxxxxx,
Atty./DEBTORS.) [EOD 04/02/01] [JW]
NOTICE of Motion and Hearing (Hearing only if objections filed by
4/16/01 @ 4:00PM) on 05/09/01 at 02:00 P.M. at 000 Xxxxxx Xxxxxx, 0xx
Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 [EOD 04/02/01] [JW]
CERTIFICATE of Service [EOD 04/02/01] [JW]
03/30/01 6074 AMENDMENT (FIFTH) & Supplement to Schedule F (Filed by Xxxxxxx X.
Xxxxxx, Atty./DEBTORS.) [EOD 04/02/01] [JW]
NOTICE of Filing [EOD 04/02/01] [JW]
CERTIFICATE of Service [EOD 04/02/01] [JW]
03/27/01 6075 RESPONSE to Tenth Omnibus Objection to Claims (Filed by Xxx Xxxxxxxxx,
Revenue Agent/STATE OF WISCONSIN, DEPT./REVENUE.) Re: Item # 5974.[EOD
04/02/01] [JW]
03/26/01 6076 ORDER Signed and Located in Original Document Enlarging Time Within
Which to File Notices of Removal Re: Item # 5797. [EOD 04/04/01] [JW]
03/26/01 6077 ORDER Signed and Located in Original Document Re: Item # 6028. [EOD
04/04/01] [JW]
03/26/01 6078 ORDER Signed and Located in Original Document Re: Item # 6029. [POD
04/04/01] [JW]
03/26/01 6079 ORDER Signed and Located in Original Document Extending Time Which
Debtors Must Assume/Reject Unexpired Leases Re: Item # 6030. [EOD
04/04/01] [JW]
03/26/01 6080 ORDER Signed and Located in Original Document Re: Item # 6034. [EOD
04/04/01] [JW]
03/26/01 6081 ORDER Signed and Located in Original Document Regarding Extension of
Discovery Period Re: Item # 6035. [EOD 04/04/01] [JW]
03/28/01 6082 ORDER Signed and Located in Original Document Re: Item # 6060. [EOD
04/04/01] [JW]
03/29/01 6083 ORDER Signed and Located in Original Document Re: Item # 6065. [EOD
04/04/01] [JW]
12
Filing Date No. Entry
------------------------------------------------------------------------------------------------
03/29/01 6084 ORDER Signed and Located in Original Document (AMENDED) Approving Entry
Into Contract for Transfer of Operations of Facility Known as Montvue &
Authorizing Assumption & Assignment of Related Executory Contracts Re:
Item # 6066. [EOD 04/04/01] [JW]
& Re: Item # 5968. [EOD 04/04/01] [JW]
& Re: Item # 5782. [EOD 04/04/01] [JW]
04/02/01 6085 OBJECTION to Tenth Omnibus Objection to Claim (Filed by Xxxxx X.
Xxxxxxxxxx, Atty./LARAMIE COUNTY.) Re: Item # 5974. [EOD 04/04/01] [JW]
CERTIFICATE of Service [EOD 04/04/01] [JW]
04/02/01 6086 RESPONSE to Objection to Claim (Filed by Xxxxxx Xxxxx,
V.Pres./SPECIALIZED IMAGING, INC.) [EOD 04/04/01] [JW]
04/02/01 6087 WITHDRAWAL & Entry of Appearance (Filed by Xxxxx X. Xxxxxxxxx, Esq. &
Xxxxx X. Wholly, Atty./STATE OF MAINE.) [EOD 04/04/01] [JW]
04/02/01 6088 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx 3. Xxxxxxxxxx,
Esq.) [POD 04/04/01] [JW]
04/02/01 6089 RESPONSE to Tenth Omnibus Objection to Claim 8574 (Filed by Xxxxxx X.
Xxxxxxxx, Atty./STATE OF MICHIGAN.) Re: Item # 5974. [EOD 04/04/01] [JW]
PROOF of Service [EOD 04/04/01] [JW]
04/02/01 6090 APPLICATION for Compensation and for Reimbursement of Expenses (KPMG
LLP) (Filed by Xxxxx Xxxxxxx, Partner/TAX CONSULTANTS/DEBTORS.)
TWELFTH INTERIM 11/1/00 thru 11/30/00 [EOD 04/04/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/22/01 @
4:00PM) [EOD 04/04/01] [JW]
CERTIFICATE of Service [EOD 04/04/01] [JW]
04/02/01 6091 APPLICATION for Compensation and for Reimbursement of Expenses (KPMG
LLP)( (Filed by Xxxxx Xxxxxxx, Partner/TAX CONSULTANTS/DEBTORS.)
THIRTEENTH INTERIM 12/1/00 thru 12/31/00 [EOD 04/04/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/22/01 @
4:00PM) [EOD 04/04/01] [JW]
CERTIFICATE of Service [EOD 04/04/01] [JW]
13
Filing Date No. Entry
------------------------------------------------------------------------------------------------
04/02/01 6092 APPLICATION for Compensation and for Reimbursement of Expenses (KPMG
LLP)( (Filed by Xxxxx Xxxxxxx, Partner/TAX CONSULTANTS/DEBTORS.)
FOURTEENTH INTERIM 1/1/01 thru 1/31/01 [EOD 04/04/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/22/01 @
4:00PM) [EOD 04/04/01] [JW]
CERTIFICATE of Service [EOD 04/04/01] [JW]
04/02/01 6093 APPLICATION for Compensation and for Reimbursement of Expenses (KPMG
LLP)( (Filed by Xxxxx Xxxxxxx, Partner/TAX CONSULTANTS/DEBTORS.)
FIFTEENTH INTERIM 2/1/01 thru 2/28/01 [EOD 04/04/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/22/01 @
4:00PM) [EOD 04/04/01] [JW]
CERTIFICATE of Service [EOD 04/04/01] [JW]
03/27/01 6094 STIPULATION AND ORDER Settling Seventh Omnibus Objection to Claims
w/Respect to Hartford Specialty Co (Filed by Xxxxxxx X. Xxxxxx,
Atty./HARTFORD SPECIALTY CO. & Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS.)
Re: Item # 4579.[EOD 04/04/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD 04/04/01] [JW]
04/03/01 6095 SUPPLEMENTAL Response to Motion to Temporary Allowance of Claim & In
Support of Ninth Omnibus Objection to Claim (Filed by Xxxxxxx X.
Xxxxxxxxx, Atty./DEBTORS.) Re: Item # 5793. [Disposed] [EOD
04/04/01] [JW]
& Re: Item # 5705. [EOD 04/04/01] [JW]
& Re: Item # 4994. [EOD 04/04/01] [JW]
CERTIFICATE of Service [EOD 04/04/01] [JW]
04/03/01 6096 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx X. Xxxxxxxx,
Esq.) [EOD 04/04/01] [JW]
04/03/01 6097 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxx X. Xxxxxx, Esq.)
[EOD 04/04/01] [JW]
03/30/01 6098 HEARING Adjourned (See: Item # 6069) on 04/12/01 at 02:00 P.M. at
000 Xxxxxx Xxxxxx, 0/xx/ Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 Re:
Item # 5551. [EOD 04/09/01] [JW]
04/03/01 6099 MONTHLY Reporting Requirements (Dec./00) [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
14
Filing Date No. Entry
-------------------------------------------------------------------------------------------------
04/03/01 6100 MONTHLY Reporting Requirements (Jan./01) [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/03/01 6101 ORDER Signed and Located in Original Document Re: Item # 6070. [EOD
04/09/01] [JW]
04/04/01 6102 RESPONSE to Tenth Omnibus Objection to Claim #'s 5932 & 5934 (Filed by
Xxxxx X. Xxxxxxxxx, Atty./HEALTH CARE REIT, INC.) Re: Item # 5974.
[EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/04/01 6103 RESPONSE to Omnibus Objection to Claim # 2358 (Filed by Xxxx X. Xxxxx,
Atty./XXXXXXX XXXXXX, d/b/a Xxxxxx Commercial Refrigeration.) Re:
Item # 5974. [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/04/01 6104 NOTICE of Service Re: Item # 6076. [EOD 04/09/01] [JW]
04/04/01 6105 RESPONSE to Tenth Omnibus Objection to Claims (Filed by Xxxxxxx X.
Xxxxxx, Atty./HEALTH CARE PROPERTY INVESTORS, INC.) Re: Item # 5974.
[EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/04/01 6106 RESPONSE to Tenth Omnibus Objection to Claims (Filed by Xxxxxxx X.
Xxxxxx, Atty./OMNICRE PHARMACY OF MASSACHUSETTS LLC.) Re: Item #
5974. [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/05/01 6107 RESPONSE in OPPOSITION to Tenth Omnibus Objection to Claims (Filed by
R. Xxxx Xxxx, Atty./XXXXXXX ELECTRIC, INC. OF FLORIDA.) Re: Item #
5974. [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/05/01 6108 RESPONSE in Protest to Disallowance of Portion of Claim (Filed by
Xxxxxx X. Xxxxxx/XXXXXX & XXXXXXXX LLP) Re: Item # 5974. [EOD
04/09/01] [JW]
04/05/01 6109 APPLICATION for Compensation and for Reimbursement of Expenses
(Cleary, Gottlieb, Xxxxx & Xxxxxxxx) (Filed by Xxxxxxx X. Xxxxxxxxx,
Atty./DEBTORS.) SIXTEENTH 1/1/01 thru 1/31/01 [EOD 04/09/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/25/01 @
4:00PM) [EOD 04/09/01] [JW]
04/05/01 6110 AFFIDAVIT of Mailing w/Notice of Entry of Order Confirming Plan [EOD
04/09/01] [JW]
15
Filing Date No. Entry
-------------------------------------------------------------------------------------------------
04/05/01 6111 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxxxxxxx X. Xxxxxxx,
Esq.) [EOD 04/09/01] [JW]
04/05/01 6112 RESPONSE to Tenth Omnibus Objection to Claim (Filed by Xxxxxxx X.
Xxxxxx, Atty./PROGRESS LEASING COMPANY.) Re: Item # 5974. [EOD
04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/05/01 6113 RESPONSE to Objection to Claim # 8352 (Filed by Xxxx X. Xxxxxx,
Atty./STATE OF CONNECTICUT, DEPT./REVENUE.) [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/05/01 6114 OBJECTION to Motion for Relief from Stay (Filed by Xxxxxxx X.
Xxxxxxxxx, Atty./DEBTORS.) Re: Item # 6049. [EOD 04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/05/01 6115 RESPONSE to Tenth Omnibus Objection to Claim # 5637 (Filed by Xxxxx X.
Xxxxxx, Atty./XXXXXXX X. XXXXXXXX, ESQ.) Re: Item # 5974. [EOD
04/09/01] [JW]
CERTIFICATE of Service [EOD 04/09/01] [JW]
04/05/01 6116 THE FOLLOWING TRANSFERS OF CLAIM WERE Filed by Madison Creditor
Liquidity Investors 202, LLC (Transferee) [EOD 04/09/01] [JW]
04/05/01 6117 ACSYS [EOD 04/09/01] [JW]
04/05/01 6118 Accounting Solutions [EOD 04/09/01] [JW]
04/05/01 6119 American Medical Service Co. [EOD 04/09/01] [JW]
04/05/01 6120 Audio/Fireex Inc.) [EOD 04/09/01] [JW]
04/05/01 6121 AWT Environmental [EOD 04/09/01] [JW]
04/05/01 6122 Bethesda Mem Hosp [EOD 04/09/01] [JW]
04/05/01 6123 Coastal Supply [EOD 04/09/01] [JW]
04/05/01 6124 Corporate Search [EOD 04/09/01] [JW]
04/05/01 6125 D&B Tree [EOD 04/09/01] [JW]
04/05/01 6126 Xxxxx Xxxx Xxxxxxxxxxx [EOD 04/09/01] [JW]
04/05/01 6127 Delta Medical [EOD 04/09/01] [JW]
04/05/01 6128 Greenwood Landscape [EOD 04/09/01] [JW]
04/05/01 6129 Xxxxxx Machinery [EOD 04/09/01] [JW]
04/05/01 6130 Xxxxxxxxx Fruit & Produce Co. Inc. [EOD 04/09/01] [JW]
16
Filing Date No. Entry
-------------------------------------------------------------------------------------------------
04/05/01 6131 HISEC, Inc. [EOD 04/09/01] [JW]
04/05/01 6132 Immucor [EOD 04/09/01] [JW]
04/05/01 6133 Xx. Xxxxxx Xxxxxx DDS [EOD 04/09/01] [JW]
04/05/01 0000 X.X. Xxxxx, Xx. [EOD 04/09/01] [JW]
04/05/01 6135 Portable XRAY [EOD 04/09/01] [JW]
04/05/01 6136 Printing & Promotion Plus [EOD 04/09/01] [JW]
04/05/01 6137 Xxxxxxx Heating Air Condition Refrigeration [EOD 04/09/01] [JW]
04/05/01 6138 Rentokil [EOD 04/09/01] [JW]
04/05/01 0000 Xxxxx Xxxx Xxxxxxxx Xx Inc [EOD 04/09/01] [JW]
04/05/01 6140 Some Things Fishy [EOD 04/09/01] [JW]
04/05/01 6141 The Elkhart Truth [EOD 04/09/01] [JW]
04/05/01 6142 The Republic [EOD 04/09/01] [JW]
04/05/01 6143 Training Resources 2000 Inc [EOD 04/09/01] [JW]0
04/05/01 6144 Vision Medical Imaging LLC [EOD 04/09/01] [JW]
04/05/01 6145 Xxxxxxx Warehouse Inc [EOD 04/09/01] [JW]
04/06/01 6146 WITHDRAWAL of Claim for WIT filed 2/2/01 ($544.00) (Filed by Xxxxxx
X. Xxxxxxxx, ILLINOIS DEPT./REVENUE.) [EOD 04/09/01] [JW]
04/06/01 6147 AFFIDAVIT of Mailing w/NOTICE of Fifth Amendment to Schedules & Bar
Date for Filing Proofs of Claim [EOD 04/09/01] [JW]
04/06/01 6148 NOTICE of Service Re: Item # 6073. [EOD 04/09/01] [JW]
04/06/01 6149 OBJECTION to Reduce Claim (Filed by Xxxxx Xxxxxx/XXXXXX XXXXX FARM.)
[EOD 04/09/01] [JW]
04/06/01 6150 RESPONSE to Objection to Claim (Filed by Xxxx X. Xxxxxxxxx, Managing
Member/PARTY FIXINS, LLC.) Re: Item # 6073. [EOD 04/09/01] [JW]
03/30/01 6151 CHANGE of Address (Filed by Xxxxx Xxxxxx, Atty./ESTATE/XXXXXXX X.
XXXXXX.) [EOD 04/10/01] [JW]
04/06/01 6152 RESPONSE to Tenth Omnibus Objection to Claims (Filed by Xxxxx Xxxxx
Xxxxxx, Revenue Officer II/KING COUNTY TREASURY DIVISION.) Re: Item #
5974. [EOD 04/11/01] [JW]
04/06/01 6153 DECLARATION of Xxxxx Xxxxx Xxxxxx, Revenue Officer II Re: Item #
6152. [EOD 04/11/01] [JW]
17
Filing Date No. Entry
-------------------------------------------------------------------------------------------------
04/06/01 6154 RESPONSE to Tenth Omnibus Objection to Claims (Filed by Xxxxx X.
Xxxxxxx, Atty./TAX AUTHORITIES) Re: Item # 5974. [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/06/01 6155 RESPONSE to Tenth Omnibus Objection to Claims (Filed by Xxxxxx X.
Xxxxxxx, Bankruptcy Mgr./LEASE CORPORATION OF AMERICA.) Re: Item #
5974. [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/09/01 6156 APPLICATION for Compensation and for Reimbursement of Expenses (Xxxx
Xxxxx LLP) (Filed by Jan A.T. van Amerongen, Jr., Atty./DEBTORS.)
SEVENTEENTH INTERIM 2/1/01 thru 2/28/01 [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/09/01 6157 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by Xxxx X.
Xxxxxxxx, Pres./XXXXXXXX ALLIED STORAGE CO., INC.) Re: Item # 6073.
[EOD 04/11/01] [JW]
04/09/01 6158 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by Xxxx
Xxxxxxxx, Claimant.) Re: Item # 6073. [EOD 04/11/01] [JW]
04/09/01 6159 OBJECTION to Motion for Relief from Stay (Filed by Xxxxxxx X.
Xxxxxxxxx, Atty./DEBTORS.) Re: Item # 5526. [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/10/01 6160 COUNSEL'S Agenda with Matters Scheduled on 04/12/01 at 02:00 P.M. at
000 Xxxxxx Xxxxxx, 0/xx/ Xxxxx, Xxxxxxxxx #0, Xxxxxxxxxx, XX 00000 [EOD
04/11/01] [JW]
04/10/01 6161 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Xxxx X. Xxxxxxxx, Esq.)
[EOD 04/11/01] [JW]
04/10/01 6162 APPLICATION for Compensation and for Reimbursement of Expenses
(Pricewaterhousecoopers LLP) (Filed by Xxxxxx Xxxx, Accounting
Advisors, Auditors & Consultants/DEBTORS.) FIFTEENTH INTERIM 12/1/00
thru 12/31/00 [EOD 04/11/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/30/01 @
4:00PM) [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
18
Filing Date No. Entry
-------------------------------------------------------------------------------------------------
04/10/01 6163 APPLICATION for Compensation and for Reimbursement of Expenses
(Pricewaterhousecoopers LLP) (Filed by Xxxxxx Xxxx, Accounting
Advisor, Auditors & Consultants/DEBTORS.) SIXTEENTH INTERIM 1/1/01
thru 1/31/01 [EOD 04/11/01] [JW]
NOTICE of Application (Hearing only if objections filed by 4/30/01 @
4:00PM) [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/10/01 6164 THE FOLLOWING TRANSFERS OF CLAIM WERE Filed by Madison Creditor
Liquidity Investors 202, LLC [EOD 04/11/01] [JW]
04/10/01 6165 Affordable Medical Transport [EOD 04/11/01] [JW]
04/10/01 6166 Coastal Training Tech [EOD 04/11/01] [JW]
04/10/01 6167 Enable Industries [EOD 04/11/01] [JW]
04/10/01 6168 Future Tech [EOD 04/11/01] [JW]
04/10/01 6169 Xxxxxxxx X. Xxxxx [EOD 04/11/01] [JW]
04/10/01 6170 Midcity Supply Co Inc. [EOD 04/11/01] [JW]
04/10/01 6171 Printing Inc. [EOD 04/11/01] [JW]
04/10/01 6172 The Binding Site [EOD 04/11/01] [JW]
04/10/01 6173 The Unisource Corp [EOD 04/11/01] [JW]
04/10/01 6174 RESPONSE to Objection to Claim (Filed by Xxx Xxxxxxxx, Claimant.) [EOD
04/11/01] [JW]
04/10/01 6175 MOTION to Amend Proofs of Claim for Creditors, American Exchange Life
Insurance Company, et al (Filed by Xxxx X. Xxxxxxxx, Atty./AMERICAN
EXCHANGE LIFE INSURANCE COMPANY, ET AL.) [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/10/01 6176 STIPULATION AND ORDER Settling Fifth Omnibus Objection to Claims
w/Respect to Pima County, Arizona (Filed by Xxxxxx X. North,
Atty./PIMA COUNTY, ARIZONA & Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS.) Re:
Item # 3094. [Disposed] [EOD 04/11/01] [JW]
CERTIFICATION of Xxxxxxx X. Xxxxxxxxx, Esq. [EOD 04/11/01] [JW]
CERTIFICATE of Service [EOD 04/11/01] [JW]
04/10/01 6177 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by Xxx
Xxxxxxxxx, Revenue Agent/STATE OF WISCONSIN, DEPT./REVENUE.) Re: Item
# 6073. [EOD 04/11/01] [JW]
19
Filing Date No. Entry
------------------------------------------------------------------------------------------------
04/10/01 6178 CERTIFICATE of Service Re: Item # 6109. [EOD 04/11/01] [JW]
04/09/01 6179 RESPONSE to Omnibus Objection to Claims (Filed by Xxxxxx X. Xxxxxxx
(Xxxx Xxxx, Entertainer).) [EOD 04/11/01] [JW]
04/06/01 6180 OBJECTION to Objection to Priority Claims (Filed by Xxxxxxxxx Xxxxxxx,
Claimant.) [EOD 04/13/01] [JW]
04/09/01 6181 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by Xxxx X.
Xxxxxxxx, Atty./MISSOURI DEPT./REVENUE.) Re: Item # 6073. [EOD
04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/09/01 6182 MOTION for Admission Pro Hac Vice (Filed by Xxxx X. Xxxxxxxx,
Atty./MISSOURI DEPT./REVENUE.) [Disposed] [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/09/01 6183 REQUEST for Telephone Hearing (Filed by Xxxx X. Xxxxxxxx,
Atty./MISSOURI DEPT./REVENUE.) [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/11/01 6184 MONTHLY Reporting Requirements (Feb./01) [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/11/01 6185 APPLICATION for Compensation and for Reimbursement of Expenses
(Manatt, Xxxxxx & Xxxxxxxx, LLP) (Filed by Xxxx Xxxxxx,
Atty./DEBTORS.) FIFTH INTERIM 1/1/01 thru 1/31/01 [EOD 04/13/01] [JW]
04/11/01 6186 SUMMARY Sheet-Part 1 Re: Item # 6185. [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/11/01 6187 RESPONSE to Objection to Claim #3521 (Filed by Xxxxxx X. Xxxxxxxx,
Claimant.) [EOD 04/13/01] [JW]
04/11/01 6188 NOTICE of Application (Hearing only if objections filed by 5/2/01 @
4:00 PM) Re: Item # 6156. [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/11/01 6189 CERTIFICATION of Counsel Regarding Omnibus Hearing Dates (Filed by
Xxxxxxx X. Xxxxxxxxx, Atty./DEBTORS.) [Disposed] [EOD 04/13/01] [JW]
04/12/01 6190 RESPONSE to Objection to Claim #3401 (Filed by Xxxxxx X. Xxxx,
Atty./XXXXXXXXX XXXXXXX XXXXXXX.) [EOD 04/13/01] [JW]
04/12/01 6191 LETTER Requesting Removal from Mailing List (Filed by Xxxxx Xxxxxxx,
Office Mgr./MILLER'S MERRY MANOR.) [EOD 04/13/01] [JW]
20
Filing Date No. Entry
------------------------------------------------------------------------------------------------
04/12/01 6192 MOTION for Relief from Stay (Filed by John X. Denney, Jr., Atty./MARY
ANN FLETCHER.) [EOD 04/13/01] [JW]
04/12/01 6193 CERTIFICATION of No Objection (Filed by Jan A.T. van Amerongen, Jr.,
Atty./DEBTORS.) Re: Item # 6038. [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 4/13/01] [JW]
04/12/01 6194 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by Steven B.
Flancher, Atty./STATE OF MICHIGAN.) Re: Item # 6073. [EOD 4/13/01] [JW]
PROOF of Service [EOD 04/13/01] [JW]
04/12/01 6195 MEMORANDUM in OPPOSITION to Eleventh Omnibus Objection to Claims (Filed
by Michelle T. Sutter, Atty./OHIO DEPT./JOB & FAMILY SERVICES.) Re:
Item # 6073. [EOD 04/13/01] [JW]
CERTIFICATION of Counsel [EOD 04/13/01] [JW]
CERTIFICATE OF SERVICE [EOD 04/13/01] [JW]
04/12/01 6196 RESPONSE to Objection to Claim #4302 (Filed by Edward W. Gardner,
Atty./LEXINGTON-FAYETTE URBAN COUNTY GOVERNMENT.) [EOD 04/13/01] [JW]
CERTIFICATE of Service [EOD 04/13/01] [JW]
04/11/01 6197 ORDER signed and Located in Original Document Re: Item # 6176. [EOD
04/16/01] [JW]
04/13/01 6198 OBJECTION to Objection to Proof of Claim & Request for Hearing (Filed
by David A. Siegel, Atty./FREDA S. MORTON.) [EOD 04/16/01] [[JW]
CERTIFICATE of Service [EOD 04/16/01] [JW]
04/13/01 6199 OPPOSITION to Eleventh Omnibus Objection to Claim # 2972 w/Request for
Production of Documents & Interrogatories (Filed by Theodore J. Kurtz,
Atty./MEDIC COACH SERVICES.) Re: Item # 6073. [EOD 04/16/01] [JW]
CERTIFICATE of Mailing [EOD 04/16/01] [JW]
04/12/01 6200 HEARING held 4/12/01 (See: Item # 6160) [EOD 04/04/17/01/01] [JW]
04/12/01 6201 STIPULATION AND ORDER Modifying Stay (Bench Filed by Kevin J. Mangan,
Atty./COMMONWEALTH EDISON COMPANY & Michael G. Busenkell,
Atty./DEBTORS.) Re: Item # 5526. [Disposed] [EOD 04/17/01] [JW]
ORDER Signed In Court Re: Item # 6201. [EOD 04/17/01] [JW]
21
Filing Date No. Entry
------------------------------------------------------------------------------------------------
04/12/01 6202 ORDER Signed In Court and Located In Original Document (SUPPLEMENTAL)
Disallowing Certain Claim & Designating Surviving Claim & Denying
Motion for Temporary Allowance Re: Item # 6095. [EOD 04/17/01] [JW]
04/13/01 6203 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by David G.
Aelvoet, Atty./TAX AUTHORITIES.) Re: Item # 6073. [EOD 04/17/01] [JW]
04/13/01 6204 NOTICE of Withdrawal of Transfer of Claim (Pentax Precision Instrument)
(Filed by James Bingaman/MADISON CREDITOR LIQUIDITY INVESTORS 202, LLC)
Re: Item # 4919. [EOD 04/17/01] [JW]
04/13/01 6205 OBJECTION to Omnibus Objection to Claim (Filed by William & Kathleen
Rossano, Claimants.) [EOD 04/17/01] [JW]
04/13/01 6206 RESPONSE to Eleventh Omnibus Objection to Claim (Filed by John Waters,
Atty./IOWA DEPT./REVENUE & FINANCE.) Re: Item # 6073. [EOD 04/17/01]
[JW]
CERTIFICATE of Service [EOD 04/17/01] [JW]
04/16/01 6207 OBJECTION to Objection to Priority Claim #5222 (Filed by Dennis E.
Goguen, Claimant.) [EOD 04/17/01] [JW]
04/16/01 6208 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by John E.
West, Atty./VINSON & ELKINS L.L.P.) Re: Item # 6073. [EOD 04/17/01]
[JW]
CERTIFICATE of Service [EOD 04/17/01] [JW]
04/16/01 6209 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by John B.
Ballard, Jr. & Shereen M. Walls, Atty./STATE OF GEORGIA,
DEPT./COMMUNITY HEALTH) Re: Item # 6073. [EOD 04/17/01] [JW]
CERTIFICATE of Service [EOD 04/17/01] [JW]
04/16/01 6210 RESPONSE to Eleventh Omnibus Objection to Claim # 6909. (Filed by
Margery E. Lieber, Atty./NATIONAL LABOR RELATIONS BOARD.) Re: Item #
6073. [EOD 04/17/01] [JW]
CERTIFICATE of Service [EOD 04/17/01] [JW]
04/16/01 6211 NOTICE of Withdrawal of Transfer of Claim (Prairie Farms Dairy Inc.)
(Filed by James Bingaman/MADISON CREDITOR LIQUIDITY INVESTORS 202,
LLC.) Re: Item # 3768. [EOD 04/17/01] [JW]
04/16/01 6212 WITHDRAWAL of Transfer of Claim (Dairy King Milk Farms) (Filed by S.
Roman, Mgr./NEXT FACTORS, INC.) Re: Item # 4546. [EOD 04/17/01] [JW]
22
Filing Date No. Entry
---------------------------------------------------------------------------------------------------------
04/16/01 6213 RESPONSE to Objection to Claim # 17 (Filed by Carl Grumer,
Atty./MANATT, PHELP & PHILLIPS, LLP) [EOD 04/17/01] [JW]
CERTIFICATE of Service [EOD 04/17/01] [JW]
04/16/01 6214 OBJECTION to Reduced Claim Amount (Filed by Timothy A. Muir,
Pres./BURLINGTON BUILDERS & CO.) [EOD 04/17/01] [JW]
04/16/01 6215 RESPONSE to Eleventh Omnibus Objection to Claim #4540 (Filed by John
Brookie Matthews, Jr., Power/Atty./WILLIE L. MATTHEWS.) Re: Item #
6073. [EOD 04/17/01] [JW]
04/16/01 6216 NOTICE of Service Regarding Request for Production of Documents
Directed to Debtors. [EOD 04/17/01] [JW]
04/17/01 6217 APPLICATION for Compensation and for Reimbursement of Expenses (Mintz,
Levin, Cohn, Ferris, Glovsky & Popeo, P.C.) (Filed by Bradley J.
Kelly, Atty./DEBTORS.) FOURTEENTH 2/1/01 thru 2/28/01 [EOD 04/17/01]
[JW]
NOTICE of Application (Hearing only if objections filed by 5/7/01 @
4:00PM) [EOD 04/17/01] [JW]
04/17/01 6218 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Isaac M. Gregorie, Jr.,
Esq.) [EOD 04/17/01] [JW]
04/17/01 6219 ORDER Signed and Located in Original Document Re: Item # 6182. [EOD
4/20/01] [JW]
04/17/01 6220 ORDER Signed and Located in Original Document Scheduling Omnibus
Hearing Dates Re: Item # 6189 [EOD 04/20/01] [JW]
04/17/01 6331 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by John P.
Dillman, Atty./CYPRESS-FAIRBANKS INDEPENDENT SCHOOL DISTRICT.) Re:
Item # 6073. [EOD 04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
04/17/01 6222 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by John P.
Dillman, Atty./FORT BEND COUNTY.) Re: Item # 6073. [EOD 04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
04/17/01 6223 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by John P.
Dillman, Atty./FORT BEND INDEPENDENT SCHOOL DISTRICT.) Re: Item #
6073. [EOD 04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
04/17/01 6224 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by John P.
Dillman, Atty./HARRIS COUNTY/CITY OF HOUSTON.) Re: Item # 6073. [EOD
04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
23
Filing Date No. Entry
------------------------------------------------------------------------------------------------
04/17/01 6225 CERTIFICATION of No Objection (Filed by Michael G. Busenkell,
Atty./DEBTORS.) Re: Item # 6039. [EOD 04/20/01] [JW]
04/17/01 6226 CERTIFICATION of No Objection (Filed by Michael G. Busenkell,
Atty./DEBTORS.) Re: Item # 6040. [EOD 04/20/01] [JW]
04/17/01 6227 STIPULATION AND ORDER (AMENDED) Modifying Stay as of 5/8/01 (Filed by
Ian Connor Bifferato, Atty./ANNIE AU & Michael G. Busenkell,
Atty./DEBTORS.) Re: Item # 3367. [EOD 04/20/01] [JW]
CERTIFICATION of Michael G. Busenkell, Esq. [EOD 04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
04/17/01 6228 STIPULATION AND ORDER Settling Second Omnibus Objection to Claims
w/Respect to IMBS, INC. (Filed by Stephen Doughty, Atty./IMBS, Inc. &
Michael G. Busenkell, Atty./DEBTORS.) Re: Item #1503. [EOD 04/20/01]
[JW]
CERTIFICATION of Michael G. Busenkell, Esq. [EOD 04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
04/18/01 6229 OBJECTION to Transfer of Claim (Filed by Nancy H. Schiltz,
Pres./Owner/BELTONE.) Re: Item # 48650. [EOD 04/20/01] [JW]
04/19/01 6230 AFFIDAVIT Under 11 U.S.C. (S) 327(e) (Filed by Pamela A. McCallum,
Esq.) [EOD 04/20/01] [JW]
CERTIFICATE of Service [EOD 04/20/01] [JW]
04/17/01 6231 RESPONSE to Objection to Claim #966 w/Correct Name & Address (Filed by
Rex Story/STORY ELECTRICAL SERVICE, INC.) [EOD 04/20/01] [JW]
01/29/01 6232 OBJECTION to Transfer of Claim (Jefferson Farmers Co-op) (Filed by
Mark Pettit, Mgr./JEFFERSON FARMERS COOPERATIVE.) Re: Item # 3761.
[EOD 04/23/01] [JW]
04/20/01 6233 RESPONSE to Eleventh Omnibus Objection to Claims (Filed by Emily W.
Toler, Atty./SECRETARY DEPT./REVENUE, STATE OF LOUSIANA.) Re: Item #
6073. [EOD 04/23/01] [JW]
CERTIFICATE of Service [EOD 04/23/01] [JW]
04/20/01 6234 RESPONSE 2 Objection to Eleventh Omnibus Objection to Claims (Filed by
Quentillai D. Burk, Credit Mgr./THE HARLOFF COMPANY, INC.) Re: Item #
6073. [EOD 04/23/01] [JW]
04/20/01 6235 NOTICE of Hearing on Motion to Amend Claims on 06/06/01 at 02:30 P.M.
at 824 Market Street, 6th Floor, Courtroom #1, Wilmington, DE 19801
Re: Item # 6175 [EOD 04/23/01] [JW]
CERTIFICATE of Service [EOD 04/23/01] [JW]
24
Filing Date No. Entry
---------------------------------------------------------------------------------------------
04/20/01 6236 COUNSEL'S Agenda with Matters Scheduled on 04/25/01 at 02:00 P.M. at
824 Market Street, 6th Floor, Courtroom #1, Wilmington, DE 19801 [EOD
04/23/01] [JW]
----------
DOCKET END
----------
25
EXHIBIT I
[Letterhead of Local Counsel]
April 20, 2001
Morgan Guaranty Trust Company
of New York, as Collateral Agent
60 Wall Street
New York, NY 10260
Ladies and Gentlemen:
We have acted as special [State] counsel to Vencor, Inc.("Vencor") and
Vencor Operating, Inc. ("Vencor Operating"; together with Vencor, the "Vencor
Companies" and each, a "Vencor Company") in connection with the delivery of the
mortgage[s], deed[s] of trust or deed[s] to secure debt described on Exhibit A
---------
hereto (the "Mortgage[s]"). Unless otherwise defined herein, terms are used
herein as defined in the Mortgage[s].
In connection with this opinion, we have examined, with respect to each of
the properties listed on Exhibit A hereto (each, a "Property"), drafts of the
---------
Amended and Restated Memorand[um][a] of Lease listed on Exhibit A hereto (each,
---------
a "Memorandum of Lease"), if any, the Mortgage[s], the financing statements
listed on Exhibit A hereto (the "Financing Statements") and such other
---------
documents, corporate records, certificates of public officials and other
instruments, and have conducted such other investigations of fact and law, as we
have deemed necessary or advisable for purposes of this opinion.
In rendering this opinion, we have assumed that:
(i) Each Vencor Company is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation, has been duly qualified as a foreign corporation for the
transaction of business and has all requisite corporate power and all
material governmental licenses, authorizations, consents and approvals
necessary to own and operate the Mortgaged [Trust] Property.
(ii) The execution, delivery and performance by each Vencor
Company of the Mortgage[s] and the execution, delivery and performance by
such Vencor Company of each of the other Financing Documents to which it is
a party (i) are within its corporate powers, (ii) have been duly authorized
by all necessary corporate action, (iii) do not require any authorization,
approval or consent of, or filings or registrations with, any governmental
or regulatory authority or agency outside of the State of __________,
except for authorizations, consents, approvals that have already been
obtained or filings that have already been made and that remain in effect,
(iv) do not contravene any provision of its certificate of incorporation or
by-laws, and (v) do not contravene or constitute a breach of or default
under any applicable provision of the laws of any jurisdiction other than
the State of ___________ or any applicable regulation thereunder or under
any agreement, judgment, injunction, order, decree or other instrument
binding upon it.
(iii) The Mortgage[s] have been duly executed and delivered by
each Vencor Company.
(iv) The Financing Documents other than the Mortgage[s]
constitute legal, valid and binding obligations of each Vencor Company
under the laws of the State of New York.
(v) Each Vencor Company owns the Mortgaged [Trust] Property
covered by the Mortgage[s] to which such Vencor Company is a party.
Upon the basis of the foregoing, we are of the opinion that, under
applicable law in effect on the date of this opinion:
Based upon the foregoing, it is our opinion that:
1. The forms of the Memorandum of Lease and Mortgage[s] are in proper
form for recordation with the [Recorder's Office] of each county in which a
Property is located in the State of [State]. The Memorand[um][a] of Lease
include all of the information required to be included under the law of the
[State] [Commonwealth] of [State] necessary to publish notice of the leasehold
interest in the relevant property created by the applicable Master Lease
Agreement. The recording of each Memorand[um][a] of Lease in the office
designated in Exhibit A hereto is the only filing, recording or registration
---------
necessary to publish notice of the leasehold interest in the relevant Property
created by the applicable Master Lease Agreement.
2
2. The Mortgage[s] constitute legal, valid and binding obligations of
each Vencor Company that is a party thereto, enforceable in accordance with
their respective terms.
3. No authorizations, approvals or consents of, or filings or
registrations with, any governmental or regulatory authority or agency of or in
the State of [State] are necessary for the execution, delivery or performance by
each Vencor Company of either the Memorand[um][a] of Lease or the Mortgage[s],
to which such Vencor Company is a party except for authorizations, consents,
approvals that have already been obtained or filings that have already been made
and that remain in effect or the recordings and/or filings described on Exhibit
-------
A.
-
4. Each Mortgage creates a valid mortgage or deed of trust or deed to
secure debt lien on the relevant Vencor Company's interest in and to the
Mortgaged [Trust] Property described therein as constitutes real property under
the law of the State of [State] and a valid security interest in such of the
other Mortgaged [Trust] Property described therein (the "UCC Property") as is
subject to the provisions of Article 9 of the Uniform Commercial Code as in
effect in the State of _______________ (the "UCC"), in each case in favor of the
Agent for the ratable benefit of the Secured Parties and securing the Secured
Obligations. The recording of the Mortgage[s] in the office designated on
Exhibit A hereto and the filing of the Financing Statements in the offices
designated in Exhibit A hereto are the only filings, recordings and
registrations necessary to perfect, publish notice of and preserve the lien of
and security interest in the Mortgaged [Trust] Property created by the
Mortgage[s] and the UCC Property created by the Mortgage[s] and the Financing
Statements, except that (i) continuation statements relating to the Financing
Statements must be filed within _____________ [state time period], and (ii)
additional filings may be necessary with respect to the UCC Property if the
Company changes its name, identity or corporate structure or the jurisdiction in
which its places of business in the State of ___________ or the UCC Property are
located.
The foregoing opinion is subject to the following qualifications:
(vi) The enforceability of the Mortgage[s] may be limited by
bankruptcy, insolvency, fraudulent conveyance or other similar laws affecting
creditors' rights generally and by general equitable principles.
(vii) We note the possible unenforceability in whole or in part of
certain remedial provisions of the Mortgage[s], although the inclusion of such
provisions does not render any Liens purported to be granted or created thereby
invalid, and the Mortgage[s] contain, in our judgment, adequate remedial
3
provisions for the practical realization of the principal rights and benefits
intended to be afforded thereby.
(viii) The provisions of the Mortgage[s] that permit the secured party
thereunder to take actions or make determinations may be subject to requirements
that such actions or determinations be reasonable and taken in good faith.
(ix) We express no opinion as to any regulatory scheme applicable
to, or any license or permit required in connection with, the business conducted
by any Vencor Company.
(x) We express no opinion as the right, title or interest of any
Vencor Company in or to any collateral or the value given therefor, and assume
that value is given.
We are admitted to practice in the State of [State]. We express no
opinion as to matters under or involving the laws of any jurisdiction other than
the laws of the State of [State].
This opinion may be relied upon by each of you, by your respective
successors and assigns, by the holders from time to time of the indebtedness
secured by the Mortgage[s].
Very truly yours,
4
EXHIBIT J
ATTACHMENT I
FORM OF
SUBORDINATION PROVISIONS
Description of [promissory note][Guarantee] to which this Attachment I is
affixed:
_______________________________________________________________________
_______________________________________________________________________
Reference is made to the [promissory note][Guarantee] described above (the
"Subordinated [Note][Guarantee]") to which this Attachment I is affixed made by
Vencor, Inc. (to be renamed Kindred Healthcare, Inc.) (the"[Issuer][Guarantor]")
in favor of [ ] (the "Subordinated Lender"). Capitalized terms used herein and
not otherwise defined herein shall have the meanings assigned to such terms in
the Credit Agreement dated as of April 20, 2001 ("the Credit Agreement") and
entered into by and among Vencor Operating, Inc. (to be renamed Kindred
Healthcare Operating, Inc.) (the "Borrower"), the [Issuer][Guarantor], the
Lenders, Swingline Bank and LC Issuing Banks party thereto, Morgan Guaranty
Trust Company of New York as Collateral Agent and Administrative Agent, and
General Electric Capital Corporation, as Documentation Agent and Collateral
Monitoring Agent. References herein to the "Lenders" includes Lenders under the
Credit Agreement (the "Senior Lenders") and lenders under the Senior Secured
Credit Agreement (the "Second Priority Lenders"). References herein to "Senior
Debt" means all Debt or obligations (whether in existence on the Closing Date or
arising afterwards, absolute or contingent, direct or indirect) for or in
respect of principal (when due, upon acceleration, upon redemption, upon
mandatory repayment or repurchase pursuant to a mandatory offer to purchase, or
otherwise), premium, interest, penalties, fees, indemnification, reimbursement
and other amounts payable and liabilities with respect to Debt or amounts owing
under the Credit Agreement, the Designated Interest Rate Agreements and the
Senior Secured Credit Agreement, including all interest accrued or accruing
after the commencement of any bankruptcy, insolvency or reorganization or
similar case or proceeding at the contract rate (including, without limitation,
any contract rate applicable upon default) specified in the relevant
documentation, whether or not the claim for such interest is allowed as a claim
in such case or proceeding.
References to the "Controlling Agent" means, so long as any Senior Debt arising
under the Credit Agreement remains outstanding, the Administrative Agent and, at
any time thereafter, the administrative agent under the Senior Secured Credit
Agreement (the "Second Priority Administrative Agent"). References to the
"Subordinated Lender" shall include each subsequent holder of the Subordinated
[Note][Guarantee], each of whom agrees to the provisions hereof by its
acceptance of the Subordinated [Note][Guarantee].
Pursuant to the requirements of the Credit Agreement and the Senior Secured
Credit Agreement, the [Issuer][Guarantor] has unconditionally guaranteed all
Senior Debt arising under the Credit Agreement, the Designated Interest Rate
Agreements and the Senior Secured Credit Agreement pursuant to the Senior
Guarantees referred to below. The Senior Lenders have agreed to make loans to
the Borrower and the LC Issuing Banks referred to in the Credit Agreement have
agreed to issue letters of credit for the account of, among others, the
Borrower, upon the terms and subject to the conditions specified in the Credit
Agreement, and the Second Priority Lenders have agreed to accept notes under the
Senior Secured Credit Agreement in partial satisfaction of their Senior Debt
Claims (as defined therein), which in each case include the requirement that the
[Issuer's][Guarantor's] obligations under the Subordinated [Note][Guarantee] be
subordinated to its obligations under such Senior Guarantees as provided herein.
The Subordinated Lender has extended credit to [the Issuer pursuant to, and upon
the terms specified in, the Subordinated Note][a Vencor Unrestricted Subsidiary,
which extension of credit is Guaranteed by the Guarantor pursuant to, and upon
the terms specified in, the Subordinated Guarantee] (all obligations of the
[Issuer][Guarantor] in respect of the Subordinated [Note][Guarantee], the
"Subordinated Obligations"). The Subordinated Lender by its execution of this
Attachment I agrees (for itself and its successors and assigns) to subordinate
its rights under the Subordinated Obligations to the rights of the Lenders under
the Senior Guarantees.
Therefore, in consideration of these premises, the [Issuer][Guarantor] and
the Subordinated Lender agree that the terms of the Subordinated
[Note][Guarantee] are hereby amended to incorporate the subordination provisions
that follow:
1. Agreement to Subordinate. The Subordinated Lender hereby agrees that
[the Debt evidenced by the Subordinated Notes][the obligations of the Guarantor
evidenced by the Subordinated Guarantee] shall be subordinated and junior in
right of payment, to the extent and in the manner provided in this Attachment I,
to the prior payment by the Guarantor of its obligations (the "Senior Guarantee
Obligations") under the Vencor Guaranty Agreement and the Vencor Guaranty
Agreement (as defined in the Senior Secured Credit Agreement)
2
(together, the "Senior Guarantees"). The subordination provisions in this
Attachment I are for the benefit of and enforceable by holders of Senior Debt or
their representatives.
2. (a) The [Issuer][Guarantor] shall not make any payment of any
Subordinated Obligations or any claim for rescission or damages in respect
thereof and shall not repay, repurchase, redeem or otherwise retire any
Subordinated Obligations (collectively, "pay the Subordinated Obligations") if
at any time any Senior Debt has not been paid when due, whether at maturity,
upon redemption or mandatory repurchase, acceleration, or otherwise, and the
default has not been cured or waived.
(b) During the continuance of any default (other than a default of
the type described in clause (a)) with respect to any Senior Debt pursuant
to which the maturity thereof may be accelerated immediately without
further notice (except any notice that may be required to effect
acceleration) or upon the expiration of a grace period, the
[Issuer][Guarantor] may not make any payment of any Subordinated
Obligations for a period (a "Payment Blockage Period"):
(i) commencing upon the receipt by the [Issuer][Guarantor] of
written notice of default from any representative of holders of Senior
Debt specifying an election to effect a Payment Blockage Period (a
"Blockage Notice") and
(ii) ending 360 days thereafter (or earlier if the Payment
Blockage Period is terminated (A) by written notice to the
[Issuer][Guarantor] from such representative, (B) by repayment in full
of such Senior Debt or (C) because the default giving rise to the
Blockage Notice is no longer continuing).
Subject to clause (a) and the preceding paragraph, unless the holders of
such Senior Debt have accelerated the maturity of such Senior Debt, the
[Issuer][Guarantor] may resume payments on the Subordinated Obligations
after the Payment Blockage Period.
(c) Not more than one Blockage Notice may be given in any consecutive
545-day period, irrespective of the number of defaults with respect to
Senior Debt during such period. No default which existed or was continuing
on the date of the commencement of any Payment Blockage Period with respect
to the Senior Debt whose holders initiated the Payment Blockage Period may
be made the basis of the commencement of a subsequent Payment Blockage
Period by the holders of such Senior Debt, whether or not within a period
of 545 consecutive
3
days, unless the default has been cured or waived for a period of not less
than 90 consecutive days.
(d) The Subordinated Lender shall promptly notify the
Administrative Agent and the Second Priority Administrative Agent of any
default under the Subordinated [Note][Guarantee].
3. Liquidation, Dissolution, Bankruptcy. Upon any payment or distribution
of the assets of the [Issuer][Guarantor] to creditors upon a total or partial
liquidation or a total or partial dissolution of the [Issuer][Guarantor] or in a
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to the [Issuer][Guarantor] or its property:
(a) holders of Senior Debt are entitled to receive payment in full in
cash of all amounts then due in respect of Senior Guarantee Obligations,
including all interest accrued or accruing on Senior Debt after the
commencement of any bankruptcy, insolvency or reorganization or similar
case or proceeding in respect of the Borrower or the [Issuer][Guarantor] at
the contract rate (including, without limitation, any contract rate
applicable upon default) specified in the relevant documentation, whether
or not the claim for the interest is allowed as a claim in the case or
proceeding with respect to the Senior Debt (only such payment constituting
"payment in full") before the Subordinated Lender will be entitled to
receive any payment on account of the Subordinated Obligations; and
(b) until the Senior Debt is paid in full, any payment or distribution
to which the Subordinated Lender would be entitled but for these
subordination provisions shall instead be made to holders of Senior Debt or
their representatives as their interests may appear.
4. Forbearance. (a) The Subordinated Lender agrees not to ask, demand, sue
for or take or receive from the [Issuer][Guarantor] in cash or other property or
by setoff, purchase or redemption (including, without limitation, from or by way
of collateral), payment of all or any part of the Subordinated Obligations and
agrees that in connection with any proceeding involving the Borrower or the
[Issuer][Guarantor] under any Federal or state bankruptcy, insolvency,
receivership or similar law (i) the Controlling Agent is irrevocably authorized
and empowered (in its own name or in the name of the Subordinated Lender or
otherwise), but shall have no obligation, to demand, sue for, collect and
receive every payment or distribution referred to in the preceding sentence and
give acquittance therefor and to file claims and proofs of claim after the
Subordinated Lender has failed to make claims or proofs of claims in form and
substance reasonably satisfactory to the Controlling Agent prior to the date
which is 30 days before the relevant bar date, as the Controlling Agent may deem
4
necessary or advisable for the exercise or enforcement of any of the rights or
interests of the Lenders and (ii) the Subordinated Lender shall duly and
promptly take such action as the Controlling Agent may request to (A) collect
amounts in respect of the Subordinated Obligations for the account of the
Lenders and to file appropriate claims or proofs of claim in respect of the
Subordinated Obligations, (B) execute and deliver to the Controlling Agent such
irrevocable powers of attorney, assignments or other instruments as the
Controlling Agent may request in order to enable the Controlling Agent to
enforce any and all claims with respect to, and any security and other Liens
securing payment of, the Subordinated Obligations and (C) collect and receive
any and all payments or distributions which may be payable or deliverable upon
or with respect to the Subordinated Obligations. A copy of these subordination
provisions may be filed with any court as evidence of the Controlling Agent's
power and authority hereunder.
(b) Without the prior written consent of the Controlling Agent, the
[Issuer][Guarantor] will not give, or permit to be given, and the
Subordinated Lender will not receive, accept or demand, (i) any security of
any nature whatsoever for any Subordinated Obligations on any property or
assets, whether now existing or hereafter acquired, of the
[Issuer][Guarantor] or any Affiliate of the [Issuer][Guarantor] (other than
a Vencor Unrestricted Subsidiary) or (ii) any Guarantee (other than the
Subordinated Guarantee), of any nature whatsoever, by the
[Issuer][Guarantor] or any Affiliate of the [Issuer][Guarantor] (other than
by a Vencor Unrestricted Subsidiary), of any Subordinated Obligations.
(c) The Subordinated Lender waives the right to compel that the
Collateral or any other property of the [Issuer][Guarantor] or the property
of any Guarantor or any other Person be applied in any particular order to
discharge the Senior Debt. The Subordinated Lender expressly waives the
right to require the Lenders to proceed against the [Issuer][Guarantor],
the Collateral or any Guarantor or any other Person, or to pursue any other
remedy in any Lender's power which the Subordinated Lender cannot pursue
and which would lighten the Subordinated Lender's burden, notwithstanding
that the failure of any Lender to do so may thereby prejudice the
Subordinated Lender. The Subordinated Lender agrees that it shall not be
discharged, exonerated or have its obligations hereunder to the Lenders
reduced by any Lender's delay in proceeding against or enforcing any remedy
against the [Issuer][Guarantor], the Collateral or any Guarantor or any
other Person; by any Lender releasing the [Issuer][Guarantor], the
Collateral or any Guarantor or any other Person from all or any part of the
Senior Debt; or by the discharge of the [Issuer][Guarantor], the Collateral
or any Guarantor or any other Person by operation of law or otherwise, with
or without the intervention or omission
5
of a Lender. Any Lender's vote to accept or reject any plan of
reorganization relating to the [Issuer][Guarantor], the Collateral, or any
Guarantor or any other Person, or any Lender's receipt on account of all or
part of the Senior Debt of any cash, property, or securities distributed in
any bankruptcy, reorganization, or insolvency case, shall not discharge,
exonerate, or reduce the obligations of the Subordinated Lender hereunder
to the Lenders.
(d) The Subordinated Lender waives all rights and defenses arising out
of an election of remedies by any Lenders, even though that election of
remedies, including without limitation any nonjudicial foreclosure with
respect to security for the Senior Debt, has impaired the value of the
Subordinated Lender's rights of subrogation, reimbursement, or contribution
against the [Issuer][Guarantor] or any Guarantor or any other Person. The
Subordinated Lender expressly waives any rights or defenses it may have by
reason of protection afforded to the [Issuer][Guarantor] or any Guarantor
or any other Person with respect to the Senior Debt pursuant to any anti-
deficiency laws or other laws of similar import which limit or discharge
the principal debtor's indebtedness upon judicial or nonjudicial
foreclosure of real property or personal property Collateral for the Senior
Debt.
(e) The Subordinated Lender agrees that, without the necessity of any
reservation of rights against it, and without notice to or further assent
by it, any demand for payment of any Senior Debt made by a Lender may be
rescinded in whole or in part by the Lender, and any Senior Debt may be
continued, and the Senior Debt, or the liability of the Borrower, the
[Issuer][Guarantor] or any other Guarantor or any other party upon or for
any part thereof, or any Collateral or Guarantee therefor or right of
offset with respect thereto, may, from time to time, in whole or in part,
be renewed, extended, modified, accelerated, compromised, waived,
surrendered, by the Lenders, in each case without notice to or further
assent by the Subordinated Lender, which will remain bound under these
subordination provisions and without impairing, abridging, releasing or
affecting the subordination provided for herein.
5. When distribution must be paid over. If a payment or other distribution
is made on account of the Subordinated Obligations to the Subordinated Lender
that because of these subordination provisions should not have been made to it,
the Subordinated Lender shall hold it in trust for holders of Senior Debt or
their representatives and pay it over to them as their interests may appear.
6
6. Subrogation. A distribution made under these subordination provisions
to holders of Senior Debt which otherwise would have been made to the
Subordinated Lender is not, as between the [Issuer][Guarantor] and the
Subordinated Lender, a payment by the [Issuer][Guarantor] on its Senior
Guarantee Obligations. After all Senior Guarantee Obligations are paid in full
the Subordinated Lender will be subrogated to the rights of holders of Senior
Debt to receive payments in respect of Senior Guarantee Obligations, which, to
the extent received by the Subordinated Lender, do not constitute, as between
the [Issuer][Guarantor] and the Subordinated Lender, payments by the
[Issuer][Guarantor] on any Subordinated Obligation.
7. Relative Rights; Subordination Not to Prevent Events of Default or
Limit Right to Accelerate. These subordination provisions define the relative
rights of the Subordinated Lender and holders of Senior Debt and do not impair,
as between the [Issuer][Guarantor] and the Subordinated Lender, the obligation
of [Issuer][Guarantor], which is absolute and unconditional, to pay to the
Subordinated Lender the Subordinated Obligations in accordance with their terms.
The failure to make a payment pursuant to the Subordinated Obligations does not
prevent the occurrence of a default, nor do these subordination provisions have
any effect on the right of the Subordinated Lender to exercise its remedies upon
a default, subject to the rights of holders of Senior Debt, if any, to receive
distributions otherwise payable to the Subordinated Lender under this Attachment
I.
8. Subordination May Not Be Impaired by the [Issuer][Guarantor]. No right
of any holder of Senior Debt to enforce the subordination as provided herein
will be impaired by any act or failure to act by the [Issuer][Guarantor] or by
its failure to comply with these provisions.
9. Distributions and Notices to, and Notices and Consents by,
Representatives of Holders of Senior Debt. Whenever a distribution is to be made
or a notice given to holders of Senior Debt, the distribution may be made and
the notice given to the Controlling Agent, with a copy of any such notice to the
Administrative Agent or the Second Priority Administrative Agent if it is not
the same person as the Controlling Agent. Notices or consents under this
Agreement from holders of Senior Debt under the Credit Agreement may be given
only by the Administrative Agent and from holders of Senior Debt under the
Senior Secured Credit Agreement may be given only by the Second Priority
Administrative Agent. If conflicting notices, instructions, requests, consents
or other communications are received from the Administrative Agent and the
Second Priority Administrative Agent, the notice, instruction, request or
consent or other communication from the Administrative Agent shall prevail.
7
10. Reliance by Holders of Senior Debt on Subordination Provisions; No
Waiver. (a) Each Subordinated Lender by accepting the Subordinated
[Note][Guarantee] acknowledges and agrees that these subordination provisions
are, and are intended to be, an inducement and a consideration to each holder of
Senior Debt, whether created or acquired before or after the issuance of the
Subordinated [Note][Guarantee], to acquire or to hold such Senior Debt, and each
holder of Senior Debt will be deemed conclusively to have relied on these
subordination provisions in acquiring and holding such Senior Debt.
(b) The holders of Senior Debt may, at any time and from time to time,
without the consent of or notice to the Subordinated Lender, without
incurring any liability or responsibility to the Subordinated Lender, and
without impairing the rights of holders of Senior Debt under these
subordination provisions, do any of the following:
(i) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt or the Senior
Guarantee Obligations or any instrument evidencing the same or any
agreement under which Senior Debt or the Senior Guarantee Obligations
is outstanding or secured;
(ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt or the Senior
Guarantee Obligations;
(iii) release any Person liable in any manner for the payment of
Senior Debt or the Senior Guarantee Obligations; or
(iv) exercise or refrain from exercising any rights against the
[Issuer][Guarantor] and any other Person.
11. Waiver of Claims. (a) To the maximum extent permitted by law, the
Subordinated Lender waives any claim it might have against any Lender with
respect to, or arising out of, any action or failure to act or any error of
judgment, negligence, or mistake or oversight whatsoever on the part of any
Lender or its directors, officers, employees or agents (including, without
limitation, the Collateral Agent, the Administrative Agent, the Senior Secured
Administrative Agent and the Senior Secured Collateral Agent) with respect to
any exercise of rights or remedies under the loan documents relating to the
Senior Debt or any transaction relating to the Collateral. Neither the Lenders
nor any of their respective directors, officers, employees or agents shall be
liable for failure to demand, collect or realize upon any of the Collateral or
any Guarantee or for any delay in doing so or shall be under any obligation to
sell or otherwise dispose of
8
any Collateral upon the request of the Borrower, the [Issuer][Guarantor], or any
of the Subsidiaries or the Subordinated Lender or any other Person or to take
any other action whatsoever with regard to the Collateral or any part thereof or
any Guarantee.
(b) The Subordinated Lender, for itself and on behalf of its
successors and assigns, hereby waives any and all now existing or hereafter
arising rights it may have to require the Lenders to marshal assets for the
benefit of the Subordinated Lender, or to otherwise direct the timing,
order or manner of any sale, collection or other enforcement of Collateral
or enforcement of loan documents relating to the Senior Debt or the Senior
Guarantee Obligations. The Lenders are under no duty or obligation, and the
Subordinated Lender hereby waives any right it may have to compel the
Lenders, to pursue any Guarantor or other Person who may be liable for the
Senior Debt, or to enforce any Lien or Security Interest in any Collateral.
(c) The Subordinated Lender hereby waives and releases all rights
which a guarantor or surety with respect to the Senior Debt could exercise.
(d) The Subordinated Lender hereby waives any duty on the part of the
Lenders to disclose to the Subordinated Lender any fact known or hereafter
known by the Lenders relating to the operation or financial condition of
the Borrower, the [Issuer][Guarantor] or any Guarantor, or their respective
businesses. The Subordinated Lender accepts the Subordinated
[Note][Guarantee] based solely upon its independent knowledge of the
Borrower's, the [Issuer's][Guarantor's] and the Subsidiaries' financial
condition and business and the Subordinated Lender assumes responsibility
for obtaining any further or future information with respect to the
Borrower, the [Issuer][Guarantor] and the Subsidiaries or their financial
condition or business.
12. Further Assurances. The Subordinated Lender and the [Issuer][Guarantor]
at their own expense and at any time from time to time, upon the written request
of the Controlling Agent will promptly and duly execute and deliver such further
instruments and documents and take such further actions as the Controlling Agent
may reasonably request for the purposes of obtaining or preserving the full
benefits of these subordination provisions and of the rights and powers herein
granted.
9
13. Powers Coupled with an Interest. All powers, authorizations and
agencies contained in these subordination provisions are coupled with an
interest and are irrevocable until the Senior Debt is paid in full.
14. Notices. All notices, requests and demands to or upon any party hereto
shall be in writing and shall be given in the manner provided in Section 11.01
of the Credit Agreement or Section 12.01 of the Senior Secured Credit Agreement.
The notice information address for the Subordinated Lender is:
_____________________________________
_____________________________________
_____________________________________
; and the notice information address for the [Issuer][Guarantor] is:
_____________________________________
_____________________________________
_____________________________________.
15. Severability. Any provision of this Attachment I which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
16. Amendments in Writing; No Waiver; Cumulative Remedies. (a) None of the
terms or provisions of these subordination provisions may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
the Controlling Agent, the [Issuer][Guarantor] and the Subordinated Lender;
provided that any provision of these subordination provisions may be waived by
the Lenders in a letter or agreement executed by each Lender or by facsimile
transmission from each Lender.
(b) No failure to exercise, nor any delay in exercising, on the part
of the Lenders, any right, power or privilege hereunder shall operate as a
waiver thereof. No single or partial exercise of any right, power or
privilege hereunder shall preclude any other or further exercise thereof or
the exercise of any other right, power or privilege.
10
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights
or remedies provided by law.
17. Section Headings. The section headings used in these subordination
provisions are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation hereof.
18. Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THE SUBORDINATED [NOTE][GUARANTEE] OR THIS ATTACHMENT I. EACH PARTY
HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B)
ACKNOWLEDGES THAT IT UNDERSTANDS AND HAS SPECIFICALLY AGREED TO THE WAIVERS AND
CERTIFICATIONS IN THIS SECTION 18.
19. Jurisdiction; Consent to Service of Process. THE SUBORDINATED
[NOTE][GUARANTEE] AND THIS ATTACHMENT I AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES THEREUNDER AND HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES. SUBJECT TO THE
JURISDICTION OF THE COURT, EACH PARTY HERETO HEREBY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND OF ANY NEW YORK STATE COURT SITTING IN NEW YORK CITY FOR PURPOSES
OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS ATTACHMENT I. EACH
PARTY HERETO IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY
SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING
BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
11
IN WITNESS WHEREOF, the undersigned have executed this Attachment I as of
this ______ day of ______, 200__.
BY: [SUBORDINATED LENDER]
By:______________________________________
Name:
Title:
By: VENCOR, INC.
(to be renamed Kindred Healthcare, Inc.)
By:______________________________________
Name:
Title:
12
EXHIBIT K
ASSIGNMENT AGREEMENT
This ASSIGNMENT AGREEMENT (this "Agreement") is entered into by and between
the parties designated as Assignor ("Assignor") and Assignee ("Assignee") above
the signatures of such parties on the Schedule of Terms attached hereto and
hereby made an integral part hereof (the "Schedule of Terms") and relates to
that certain Credit Agreement described in the Schedule of Terms (said Credit
Agreement, as amended, supplemented or otherwise modified to the date hereof and
as it may hereafter be amended, supplemented or otherwise modified from time to
time, being the "Credit Agreement", the terms defined therein and not otherwise
defined herein being used herein as therein defined).
IN CONSIDERATION of the agreements, provisions and covenants herein
contained, the parties hereto hereby agree as follows:
SECTION 1. Assignment and Assumption.
-------------------------
(a) Effective upon the Settlement Date specified in Item 4 of the Schedule
of Terms (the "Settlement Date"), Assignor hereby sells and assigns to Assignee,
without recourse, representation or warranty (except as expressly set forth
herein), and Assignee hereby purchases and assumes from Assignor, that
percentage interest in all of Assignor's rights and obligations as a Lender
arising under the Credit Agreement and the other Financing Documents with
respect to Assignor's outstanding Loans, if any, which represents, as of the
Settlement Date, the percentage interest specified in Item 3 of the Schedule of
Terms of all rights and obligations of Lenders arising under the Credit
Agreement and the other Financing Documents with respect to any outstanding
Loans (the "Assigned Share").
(b) In consideration of the assignment described above, Assignee hereby
agrees to pay to Assignor, on the Settlement Date, the principal amount of any
outstanding Loans included within the Assigned Share, such payment to be made by
wire transfer of immediately available funds in accordance with the applicable
payment instructions set forth in Item 5 of the Schedule of Terms.
(c) Assignor hereby represents and warrants that Item 3 of the Schedule of
Terms correctly sets forth the amount of the Loans and the Percentage of
Assignee after giving effect to the assignment and assumption described above.
(d) Assignor and Assignee hereby agree that, upon giving effect to the
assignment and assumption described above, (i) Assignee shall be a party to the
Credit Agreement and shall have all of the rights and obligations under the
Financing Documents, and shall be deemed to have made all of the covenants and
agreements contained in the Financing Documents, arising out of or otherwise
related to the Assigned Share and (ii) Assignor shall be absolutely released
from any of such obligations, covenants and agreements assumed or made by
Assignee in respect of the Assigned Share. Assignee hereby acknowledges and
agrees that the agreement set forth in this Section 1(d) is expressly made for
the benefit of the Issuer, Vencor, the Administrative Agent, the Assignor and
the Lenders and their respective successors and permitted assigns.
(e) Assignor and Assignee hereby acknowledge and confirm their
understanding and intent that (i) this Agreement shall effect the assignment by
Assignor and the assumption by Assignee of Assignor's rights and obligations
with respect to the Assigned Share, (ii) any other assignments by Assignor of a
portion of its rights and obligations with respect to the outstanding Loans
shall have no effect on the Loans and the Percentage of Assignee set forth in
Item 3 of the Schedule of Terms or on the interest of Assignee in any
outstanding Loans corresponding thereto, and (iii) from and after the Settlement
Date, the Administrative Agent shall make all payments under the Credit
Agreement in respect of the Assigned Share (including without limitation all
payments of principal and accrued but unpaid interest, with respect thereto) (A)
in the case of any such interest and fees that shall have accrued prior to the
Settlement Date, to Assignor, and (B) in all other cases, to Assignee; provided
that Assignor and Assignee shall make payments directly to each other to the
extent necessary to effect any appropriate adjustments in any amounts
distributed to Assignor and/or Assignee by the Administrative Agent under the
Financing Documents in respect of the Assigned Share in the event that, for any
reason whatsoever, the payment of consideration contemplated by Section 1(b)
occurs on a date other than the Settlement Date.
SECTION 2. Certain Representations, Warranties and Agreements.
--------------------------------------------------
(a) Assignor represents and warrants that it is the legal and beneficial
owner of the Assigned Share, free and clear of any adverse claim.
(b) Assignor shall not be responsible to Assignee for the execution,
effectiveness, genuineness, validity, enforceability, collectibility or
sufficiency of any of the Financing Documents or for any representations,
warranties, recitals or statements made therein or made in any written or oral
statements or in any financial or other statements, instruments, reports or
certificates or any other documents furnished or made by Assignor to Assignee or
by or on behalf of the
2
Issuer or any of the Guarantors to Assignor or Assignee in connection with the
Financing Documents and the transactions contemplated thereby or for the
financial condition or business affairs of the Issuer or any other Person liable
for the payments of any Obligations, nor shall Assignor be required to ascertain
or inquire as to the performance or observance of any of the terms, conditions,
provisions, covenants or agreement contained in any of the Financing Documents
or as to the existence or possible existence of any Event of Default or Default.
(c) Assignee represents and warrants that it is an Eligible Assignee; that
it has experience and expertise in the making of loans such as the Loans; that
it has acquired the Assigned Share for its own account and not with any present
intention of selling all or any portion of such interest; and that it has
received, reviewed and approved a copy of the Credit Agreement (including all
Exhibits and Schedules thereto).
(d) Assignee represents and warrants that it has received from Assignor
such financial information regarding the Issuer and the Guarantors as is
available to Assignor and as Assignee has requested, that it has made its own
independent investigation of the financial condition and affairs of the Issuer
and the Guarantors in connection with the assignment evidenced by this
Agreement, and that it has made and shall continue to make its own appraisal of
the creditworthiness of the Issuer and the Guarantors. Assignor shall have no
duty or responsibility, either initially or on a continuing basis, to make any
such investigation or any such appraisal on behalf of Assignee or to provide
Assignee with any other credit or other information with respect thereto,
whether coming into its possession before the making of the Loans or at any time
or times thereafter, and Assignor shall not have any responsibility with respect
to the accuracy of or the completeness of any information provided to Assignee.
(e) Each party to this Agreement represents and warrants to the other party
hereto that it has full power and authority to enter into this Agreement and to
perform its obligations hereunder in accordance with the provisions hereof, that
this Agreement has been duly authorized, executed and delivered by such party
and that this Agreement constitutes a legal, valid and binding obligation of
such party, enforceable against such party in accordance with its terms, except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and by general principles of equity.
SECTION 3. Miscellaneous.
-------------
(a) Each of Assignor and Assignee hereby agrees from time to time, upon
request of the other such party hereto, to take such additional actions and to
3
execute and deliver such additional documents and instruments as such other
party may reasonably request to effect the transactions contemplated by, and to
carry out the intent of, this Agreement.
(b) Neither this Agreement nor any term hereof may be changed, waived,
discharged or terminated, except by an instrument in writing signed by the party
(including, if applicable, any party required to evidence its consent to or
acceptance of this Agreement) against whom enforcement of such change, waiver,
discharge or termination is sought.
(c) Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed. For the purposes hereof, the notice address of each of
Assignor and Assignee shall be as set forth on the Schedule of Terms or, as to
either such party, such other address as shall be designated by such party in a
written notice delivered to the other such party. In addition, the notice
address of Assignee set forth on the Schedule of Terms shall serve as the
initial notice address of Assignee for purposes of Section 12.01 of the Credit
Agreement.
(d) In case any provision in or obligation under this Agreement shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
(e) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAWS OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES, EXCEPT AS OTHERWISE REQUIRED BY MANDATORY PROVISIONS OF LAW
AND EXCEPT TO THE EXTENT THAT REMEDIES PROVIDED BY THE LAWS OF ANY JURISDICTION
OTHER THAN THE STATE OF NEW YORK ARE GOVERNED BY THE LAWS OF SUCH JURISDICTION.
(f) This Agreement shall be binding upon, and shall inure to the benefit
of, the parties hereto and their respective successors and assigns.
4
(g) This Agreement may be executed in one or more counterparts and by
different parties hereto in separate counterparts, each of such when so executed
and delivered shall be deemed an original, but all such counterparts together
shall constitute but one and the same instrument; signature pages may be
detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document.
(h) This Agreement shall become effective upon the date (the "Effective
Date") upon which all of the following conditions are satisfied: (i) the
execution of a counterpart hereof by each of Assignor and Assignee, (ii) the
receipt by Administrative Agent of the processing and recordation fee referred
to in subsection 12.06(c) of the Credit Agreement, (iii) in the event Assignee
is organized under the laws of a jurisdiction outside the United States, the
delivery by Assignee to Administrative Agent of such forms, certificates or
other evidence with respect to United States federal income tax withholding
matters as Assignee may be required to deliver to Administrative Agent pursuant
to said subsection 12.06(c), (iv) if required, the execution of a counterpart
hereof by Administrative Agent as evidence of its consent to and acceptance
hereof, (v) the receipt by Administrative Agent of originals or telefacsimiles
of the counterparts described above and authorization of delivery thereof, and
(vi) the recordation by Administrative Agent in the Register of the pertinent
information regarding the assignment effected hereby in accordance with
subsection 12.06(c) of the Credit Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized, such execution being made as of the Effective Date in the applicable
spaces provided on the Schedule of Terms.
[Remainder of page intentionally left blank]
5
SCHEDULE OF TERMS
1. Issuer: Vencor Operating, Inc. (to be renamed Kindred Healthcare Operating,
------
Inc.) (the "Issuer").
2. Name and Date of Credit Agreement: Credit Agreement Providing for the
---------------------------------
Issuance of $300,000,000 Senior Secured Notes due 2008 dated as of April
20, 2001 by and among the Issuer, Vencor, Inc. (to be renamed Kindred
Healthcare, Inc.) ("Vencor"), the Lenders party thereto, and Xxxxxx
Guaranty Trust Company of New York, as Collateral Agent and Administrative
Agent.
3. Amounts:
-------
Loans
-----
(a) Aggregate Loans of all Lenders: $_____
(b) Assigned Share/Percentage: _____%
(c) Amount of Assigned Share of Loans $_____
4. Settlement Date: __________, ____
---------------
5. Payment Instructions:
--------------------
ASSIGNOR: ASSIGNEE:
_______________________________ _______________________________
_______________________________ _______________________________
_______________________________ _______________________________
Attention:_____________________ Attention:_____________________
Reference:_____________________ Reference:_____________________
6. Notice Addresses:
----------------
ASSIGNOR: ASSIGNEE:
_______________________________ _______________________________
_______________________________ _______________________________
_______________________________ _______________________________
_______________________________ _______________________________
7. Signatures:
----------
[NAME OF ASSIGNOR], [NAME OF ASSIGNEE],
as Assignor as Assignee
By:______________________ By:______________________
Title:______________________ Title:______________________
[Consented to and accepted in accordance with
subsection 12.06(c) of the Credit Agreement
XXXXXX GUARANTY TRUST
COMPANY OF NEW YORK,
as Administrative Agent
By:_______________________
Title:______________________]
