EXHIBIT 10.1
CREDIT AGREEMENT
DATED AS OF JANUARY 6, 2004
AMONG
PSYCHIATRIC SOLUTIONS, INC.
AS THE BORROWER,
THE SUBSIDIARIES OF THE BORROWER IDENTIFIED HEREIN,
AS THE GUARANTORS,
XXXXXX COMMERCIAL PAPER, INC.,
AS SYNDICATION AGENT,
BANK OF AMERICA, N.A.,
AS ADMINISTRATIVE AGENT, SWING LINE LENDER AND L/C ISSUER,
AND
THE OTHER LENDERS PARTY HERETO
ARRANGED BY:
BANC OF AMERICA SECURITIES LLC,
AS SOLE LEAD ARRANGER AND SOLE BOOK MANAGER
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS.................................................................. 1
1.01 Defined Terms............................................................................. 1
1.02 Other Interpretive Provisions............................................................. 24
1.03 Accounting Terms.......................................................................... 25
1.04 Rounding.................................................................................. 26
1.05 References to Agreements and Laws......................................................... 26
1.06 Times of Day.............................................................................. 26
1.07 Letter of Credit Amounts.................................................................. 26
ARTICLE II THE COMMITMENTS AND CREDIT EXTENSIONS............................................................ 26
2.01 Revolving Loans........................................................................... 26
2.02 Borrowings, Conversions and Continuations of Loans........................................ 27
2.03 Letters of Credit......................................................................... 28
2.04 Swing Line Loans.......................................................................... 35
2.05 Prepayments............................................................................... 37
2.06 Termination or Reduction of Aggregate Revolving Commitments............................... 38
2.07 Repayment of Loans........................................................................ 39
2.08 Interest.................................................................................. 39
2.09 Fees...................................................................................... 39
2.10 Computation of Interest and Fees.......................................................... 40
2.11 Evidence of Debt.......................................................................... 40
2.12 Payments Generally........................................................................ 41
2.13 Sharing of Payments....................................................................... 42
ARTICLE III TAXES, YIELD PROTECTION AND ILLEGALITY.......................................................... 43
3.01 Taxes..................................................................................... 43
3.02 Illegality................................................................................ 44
3.03 Inability to Determine Rates.............................................................. 44
3.04 Increased Cost and Reduced Return; Capital Adequacy....................................... 45
3.05 Funding Losses............................................................................ 45
3.06 Matters Applicable to all Requests for Compensation....................................... 46
3.07 Survival.................................................................................. 46
ARTICLE IV GUARANTY......................................................................................... 46
4.01 The Guaranty.............................................................................. 46
4.02 Obligations Unconditional................................................................. 46
4.03 Reinstatement............................................................................. 47
4.04 Certain Additional Waivers................................................................ 48
4.05 Remedies.................................................................................. 48
4.06 Rights of Contribution.................................................................... 48
4.07 Guarantee of Payment; Continuing Guarantee................................................ 48
ARTICLE V CONDITIONS PRECEDENT TO CREDIT EXTENSIONS......................................................... 48
5.01 Conditions of Initial Credit Extension.................................................... 48
5.02 Conditions to all Credit Extensions....................................................... 51
ARTICLE VI REPRESENTATIONS AND WARRANTIES................................................................... 51
6.01 Existence, Qualification and Power........................................................ 51
6.02 Authorization; No Contravention........................................................... 52
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6.03 Governmental Authorization; Other Consents................................................ 52
6.04 Binding Effect............................................................................ 52
6.05 Financial Statements; No Material Adverse Effect.......................................... 52
6.06 Litigation................................................................................ 53
6.07 No Default................................................................................ 53
6.08 Ownership of Property; Liens.............................................................. 53
6.09 Environmental Compliance.................................................................. 53
6.10 Insurance................................................................................. 54
6.11 Taxes..................................................................................... 54
6.12 ERISA Compliance.......................................................................... 55
6.13 Subsidiaries.............................................................................. 55
6.14 Margin Regulations; Investment Company Act; Public Utility Holding Company Act............ 55
6.15 Disclosure................................................................................ 56
6.16 Compliance with Laws...................................................................... 56
6.17 Intellectual Property; Licenses, Etc...................................................... 57
6.18 Broker's Fees............................................................................. 57
6.19 Labor Matters............................................................................. 57
6.20 Business Locations........................................................................ 57
6.21 Perfection of Security Interests in the Collateral........................................ 57
6.22 Tax Shelter Regulations................................................................... 58
6.23 Subordination............................................................................. 58
6.24 Fraud and Abuse........................................................................... 58
6.25 Licensing and Accreditation............................................................... 58
ARTICLE VII AFFIRMATIVE COVENANTS........................................................................... 59
7.01 Financial Statements...................................................................... 59
7.02 Certificates; Other Information........................................................... 60
7.03 Notices................................................................................... 61
7.04 Payment of Obligations.................................................................... 62
7.05 Preservation of Existence, Etc............................................................ 63
7.06 Maintenance of Properties................................................................. 63
7.07 Maintenance of Insurance.................................................................. 63
7.08 Compliance with Laws...................................................................... 64
7.09 Books and Records......................................................................... 64
7.10 Inspection Rights......................................................................... 64
7.11 Use of Proceeds........................................................................... 65
7.12 Additional Subsidiaries................................................................... 65
7.13 ERISA Compliance.......................................................................... 65
7.14 Pledged Assets............................................................................ 66
7.15 Post-Closing Matters...................................................................... 66
ARTICLE VIII NEGATIVE COVENANTS............................................................................. 68
8.01 Liens..................................................................................... 68
8.02 Investments............................................................................... 70
8.03 Indebtedness.............................................................................. 71
8.04 Fundamental Changes....................................................................... 71
8.05 Dispositions.............................................................................. 72
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8.06 Restricted Payments....................................................................... 72
8.07 Change in Nature of Business.............................................................. 73
8.08 Transactions with Affiliates and Insiders................................................. 73
8.09 Burdensome Agreements..................................................................... 73
8.10 Use of Proceeds........................................................................... 73
8.11 Financial Covenants....................................................................... 74
8.12 Prepayment of Other Indebtedness, Etc..................................................... 74
8.13 Organization Documents; Fiscal Year; Legal Name, State of Formation and Form of Entity.... 75
8.14 Ownership of Subsidiaries................................................................. 75
8.15 Sale and Leaseback Transactions........................................................... 75
ARTICLE IX EVENTS OF DEFAULT AND REMEDIES................................................................... 75
9.01 Events of Default......................................................................... 75
9.02 Remedies Upon Event of Default............................................................ 77
9.03 Application of Funds...................................................................... 78
ARTICLE X ADMINISTRATIVE AGENT.............................................................................. 79
10.01 Appointment and Authorization of Administrative Agent............................ 79
10.02 Delegation of Duties............................................................. 79
10.03 Liability of Administrative Agent................................................ 80
10.04 Reliance by Administrative Agent................................................. 80
10.05 Notice of Default................................................................ 80
10.06 Credit Decision; Disclosure of Information by Administrative Agent............... 81
10.07 Indemnification of Administrative Agent.......................................... 81
10.08 Administrative Agent in its Individual Capacity.................................. 82
10.09 Successor Administrative Agent................................................... 82
10.10 Administrative Agent May File Proofs of Claim.................................... 82
10.11 Collateral and Guaranty Matters.................................................. 83
10.12 Other Agents; Arrangers and Managers............................................. 83
ARTICLE XI MISCELLANEOUS.................................................................................... 84
11.01 Amendments, Etc.................................................................. 84
11.02 Notices and Other Communications; Facsimile Copies............................... 85
11.03 No Waiver; Cumulative Remedies................................................... 86
11.04 Attorney Costs, Expenses and Taxes............................................... 86
11.05 Indemnification by the Borrower.................................................. 87
11.06 Payments Set Aside............................................................... 87
11.07 Successors and Assigns........................................................... 88
11.08 Confidentiality.................................................................. 90
11.09 Set-off.......................................................................... 91
11.10 Interest Rate Limitation......................................................... 91
11.11 Counterparts..................................................................... 91
11.12 Integration...................................................................... 91
11.13 Survival of Representations and Warranties....................................... 92
11.14 Severability..................................................................... 92
11.15 Tax Forms........................................................................ 92
11.16 Replacement of Lenders........................................................... 94
11.17 Governing Law.................................................................... 94
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11.18 Waiver of Right to Trial by Jury................................................. 94
11.19 Designated Senior Indebtedness................................................... 95
11.20 USA Patriot Act Notice........................................................... 95
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SCHEDULES
2.01 Commitments and Pro Rata Shares
6.10 Insurance
6.13 Subsidiaries
6.17 IP Rights
6.20(a) Locations of Real Property
6.20(b) Locations of Tangible Personal Property
6.20(c) Locations of Chief Executive Office
6.20(e) Changes in Legal Name, State of Formation and Structure
8.01 Liens Existing on the Closing Date
8.02 Investments Existing on the Closing Date
8.03 Indebtedness Existing on the Closing Date
11.02 Certain Addresses for Notices
EXHIBITS
A Form of Loan Notice
B Form of Swing Line Loan Notice
C-1 Form of Revolving Note
C-2 Form of Swing Line Note
D Form of Compliance Certificate
E Form of Borrowing Base Certificate
F Form of Assignment and Assumption
G Form of Joinder Agreement
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CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of January 6, 2004 among
PSYCHIATRIC SOLUTIONS, INC., a Delaware corporation (the "Borrower"), the
Guarantors (defined herein), the Lenders (defined herein) and BANK OF AMERICA,
N.A., as Administrative Agent, Swing Line Lender and L/C Issuer.
The Borrower has requested that the Lenders provide a revolving credit
facility of up to $50 million for the purposes set forth herein and the Lenders
are willing to do so on the terms and conditions set forth herein.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
1.01 DEFINED TERMS.
As used in this Agreement, the following terms shall have the meanings
set forth below:
"Acquisition", by any Person, means the acquisition by such Person, in
a single transaction or in a series of related transactions, of all or any
substantial portion of the Property of another Person or at least a majority of
the Voting Stock of another Person, in each case whether or not involving a
merger or consolidation with such other Person and whether for cash, property,
services, assumption of Indebtedness, securities or otherwise.
"Administrative Agent" means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.
"Administrative Agent's Office" means the Administrative Agent's
address and, as appropriate, account as set forth on Schedule 11.02 or such
other address or account as the Administrative Agent may from time to time
notify the Borrower and the Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in
a form supplied by the Administrative Agent.
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote 5% or more of
the securities having ordinary voting power for the election of directors,
managing general partners or the equivalent.
"Agent-Related Persons" means the Administrative Agent, together with
its Affiliates (including, in the case of Bank of America in its capacity as the
Administrative Agent, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"Aggregate Revolving Commitments" means the Revolving Commitments of
all the Lenders. The amount of the Aggregate Revolving Commitments in effect on
the Closing Date is TWENTY MILLION DOLLARS ($20,000,000); provided that the
amount of the Aggregate Revolving Commitments may be increased to up to FIFTY
MILLION DOLLARS ($50,000,000) pursuant to Section 2.01(b).
"Agreement" means this Credit Agreement, as amended, modified,
supplemented and extended from time to time.
"Applicable Rate" means the following percentages per annum, based upon
the Consolidated Senior Leverage Ratio as set forth in the most recent
Compliance Certificate received by the Administrative Agent pursuant to Section
7.02(b):
Pricing Consolidated Senior Eurodollar Rate Letter of Credit Base Rate Commitment
Tier Leverage Ratio Loans Fee Loans Fee
------- ------------------------ --------------- ---------------- --------- ----------
I > or = 1.50:1.0 3.50% 3.50% 2.00% 0.50%
II < 1.50:1.0 but
> or = 1.25:1.0 3.00% 3.00% 1.50% 0.50%
III < 1.25:1.0 2.50% 2.50% 1.00% 0.50%
Any increase or decrease in the Applicable Rate resulting from a change in the
Consolidated Senior Leverage Ratio shall become effective as of the date five
(5) Business Days immediately following the date a Compliance Certificate is
delivered pursuant to Section 7.02(b); provided, however, that if a Compliance
Certificate is not delivered when due in accordance with such Section, then
Pricing Tier I shall apply as of the first Business Day after the date on which
such Compliance Certificate was required to have been delivered and shall
continue to apply until the date five (5) Business Days immediately following
the date such Compliance Certificate is actually delivered. The Applicable Rate
in effect from the Closing Date through the first Business Day immediately
following the date a Compliance Certificate is delivered pursuant to Section
7.02(b) for the fiscal quarter ending December 31, 2003 shall be determined
based upon Pricing Tier III.
"Approved Fund" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"Arranger" means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit E.
"Attorney Costs" means and includes all fees, expenses and
disbursements of any law firm or other external counsel.
"Attributable Indebtedness" means, on any date, (a) in respect of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
(b) in respect of any Synthetic Lease, the capitalized amount of the remaining
lease payments under the relevant lease that would appear on a balance sheet of
such Person prepared as of such date in accordance with GAAP if such lease were
accounted for as a capital lease, (c) in respect of any Securitization
Transaction of any Person, the outstanding principal amount of such financing,
after taking into account reserve accounts and making appropriate adjustments,
determined by the Administrative Agent in its reasonable judgment, and (d) in
the case of any Sale and Leaseback
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Transaction, the present value (discounted in accordance with GAAP at the debt
rate implied in the applicable lease) of the obligations of the lessee for
rental payments during the term of such lease).
"Audited Financial Statements" means the audited consolidated balance
sheet of the Borrower and its Subsidiaries for the fiscal year ended December
31, 2002, and the related consolidated statements of income or operations,
shareholders' equity and cash flows of the Borrower and its Subsidiaries for
such fiscal year, including the notes thereto.
"Availability Period" means, with respect to the Revolving Commitments,
the period from and including the Closing Date to the earliest of (a) the
Maturity Date, (b) the date of termination of the Aggregate Revolving
Commitments pursuant to Section 2.06, and (c) the date of termination of the
commitment of each Lender to make Loans and of the obligation of the L/C Issuer
to make L/C Credit Extensions pursuant to Section 9.02.
"Bank of America" means Bank of America, N.A. and its successors.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus 1/2 of 1% or (b) the rate of interest
in effect for such day as publicly announced from time to time by Bank of
America as its "prime rate." The "prime rate" is a rate set by Bank of America
based upon various factors including Bank of America's costs and desired return,
general economic conditions and other factors, and is used as a reference point
for pricing some loans, which may be priced at, above, or below such announced
rate. Any change in the "prime rate" announced by Bank of America shall take
effect at the opening of business on the day specified in the public
announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the Base
Rate.
"Borrower" has the meaning specified in the introductory paragraph
hereto.
"Borrowing" means a borrowing consisting of simultaneous Loans of the
same Type and, in the case of Eurodollar Rate Loans, having the same Interest
Period made by each of the Lenders pursuant to Section 2.01.
"Borrowing Base" means an amount equal to the sum of (a) eighty percent
(80%) of the net book value of Eligible Accounts plus (b) the lesser of (i)
eighty percent (80%) of the net book of Eligible Unbilled Accounts and (ii) $10
million, in each case as set forth in the most recent Borrowing Base Certificate
delivered by the Borrower in accordance with Section 7.02(c).
"Borrowing Base Certificate" has the meaning provided in Section
7.02(c).
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks are authorized to close under the Laws of, or are in
fact closed in, the state where the Administrative Agent's Office is located
and, if such day relates to any Eurodollar Rate Loan, means any such day on
which dealings in Dollar deposits are conducted by and between banks in the
London interbank eurodollar market.
"Businesses" means, at any time, a collective reference to the
businesses operated by the Borrower and its Subsidiaries at such time.
"Capital Stock" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents
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(however designated) of capital stock, (iii) in the case of a partnership,
partnership interests (whether general or limited), (iv) in the case of a
limited liability company, membership interests and (v) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distributions of assets of, the issuing Person.
"Cash Collateralize" has the meaning specified in Section 2.03(g).
"Cash Equivalents" means, as at any date, (a) 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) having maturities of not more than twelve
months from the date of acquisition, (b) Dollar denominated time deposits and
certificates of deposit of (i) any Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 or
(iii) any bank whose short-term commercial paper rating from S&P is at least A-1
or the equivalent thereof or from Xxxxx'x is at least P-1 or the equivalent
thereof (any such bank being an "Approved Bank"), in each case with maturities
of not more than 270 days from the date of acquisition, (c) commercial paper and
variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by, any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing within six
months of the date of acquisition, (d) repurchase agreements entered into by any
Person with a bank or trust company (including any of the Lenders) or recognized
securities dealer having capital and surplus in excess of $500,000,000 for
direct obligations issued by or fully guaranteed by the United States in which
such Person shall have a perfected first priority security interest (subject to
no other Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations, (e) debt
obligations issued by any domestic corporation or any domestic government
instrumentality, in each case rated A-1 (or the equivalent thereof) or better by
S&P or P-1 (or the equivalent thereof) or better by Moody's and maturing within
six months of the date of acquisition and (f) Investments, classified in
accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which are
administered by reputable financial institutions having capital of at least
$500,000,000 and the portfolios of which are limited to Investments of the
character described in the foregoing subdivisions (a) through (e).
"Change of Control" means an event or series of events by which:
(a) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, but
excluding any employee benefit plan of such person or its subsidiaries,
and any person or entity acting in its capacity as trustee, agent or
other fiduciary or administrator of any such plan) becomes the
"beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Securities Exchange Act of 1934, except that a person or group shall be
deemed to have "beneficial ownership" of all Capital Stock that such
person or group has the right to acquire (such right, an "option
right"), whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of twenty-five percent
(25%) of the Capital Stock of the Borrower entitled to vote for members
of the board of directors or equivalent governing body of the Borrower
on a fully diluted basis (and taking into account all such securities
that such person or group has the right to acquire pursuant to any
option right); or
(b) during any period of 24 consecutive months, a
majority of the members of the board of directors or other equivalent
governing body of the Borrower cease to be composed of individuals (i)
who were members of that board or equivalent governing body on the
first day of such period, (ii) whose election or nomination to that
board or equivalent governing body was approved by individuals referred
to in clause (i) above constituting at the time of such election or
nomination at least a majority of that board or equivalent governing
body or (iii) whose election
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or nomination to that board or other equivalent governing body was
approved by individuals referred to in clauses (i) and (ii) above
constituting at the time of such election or nomination at least a
majority of that board or equivalent governing body (excluding, in the
case of both clause (ii) and clause (iii), any individual whose initial
nomination for, or assumption of office as, a member of that board or
equivalent governing body occurs as a result of an actual or threatened
solicitation of proxies or consents for the election or removal of one
or more directors by any person or group other than a solicitation for
the election of one or more directors by or on behalf of the board of
directors); or
(c) a "Change of Control" (or any comparable term) occurs
under, and as defined in, any of the Senior Subordinated Notes
Documents; or
(d) a "Liquidation" occurs under, and as defined in, the
Certificate of Designations, Preferences and Rights of Series A
Convertible Preferred Stock, as amended, of the Borrower.
"Closing Date" means the date hereof.
"CMS" means the Centers for Medicare and Medicaid Services of HHS and
any successor thereof and any predecessor thereof, including the United States
Health Care Financing Administration.
"Collateral" means a collective reference to all real and personal
Property with respect to which Liens in favor of the Administrative Agent are
purported to be granted pursuant to and in accordance with the terms of the
Collateral Documents.
"Collateral Documents" means a collective reference to the Security
Agreement, Pledge Agreement, the Mortgages and such other security documents as
may be executed and delivered by the Loan Parties pursuant to the terms of
Section 7.14.
"Compliance Certificate" means a certificate substantially in the form
of Exhibit D.
"Consolidated Adjusted EBITDA" means, for any period for the Borrower
and its Subsidiaries on a consolidated basis, an amount equal to the sum of (a)
Consolidated EBITDA for such period plus (b) rent and lease expense for such
period minus (c) Consolidated Maintenance Capital Expenditures for such period
minus (d) taxes paid in cash during such period, all as determined in accordance
with GAAP.
"Consolidated EBITDA" means, for any period for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to Consolidated Net Income
for such period plus the following to the extent deducted in calculating such
Consolidated Net Income: (a) Consolidated Interest Charges for such period, (b)
the provision for federal, state, local and foreign income taxes payable by the
Borrower and its Subsidiaries for such period, (c) the amount of depreciation
and amortization expense for such period, (d) loss on refinancing of long term
debt incurred during the twelve month period ending on (and including) the
Closing Date and (e) non-cash, non-recurring expenses and charges in an
aggregate amount of up to $3 million, all as determined in accordance with GAAP.
"Consolidated Fixed Charges" means, for any period for the Borrower and
its Subsidiaries on a consolidated basis, an amount equal to the sum of (i) the
cash portion of Consolidated Interest Charges for such period plus (ii)
Consolidated Scheduled Funded Debt Payments for such period plus (iii) rent and
lease expense for such period plus (iv) the amount of all payments on Earn-Out
Obligations during such period, all as determined in accordance with GAAP.
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"Consolidated Fixed Charges Coverage Ratio" means, as of any date of
determination, the ratio of (i) Consolidated Adjusted EBITDA for the period of
the four fiscal quarters most recently ended to (ii) Consolidated Fixed Charges
for the period of the four fiscal quarters most recently ended.
"Consolidated Funded Indebtedness" means Funded Indebtedness of the
Borrower and its Subsidiaries on a consolidated basis determined in accordance
with GAAP.
"Consolidated Growth Capital Expenditures" means, for any period, for
the Borrower and its Subsidiaries on a consolidated basis, all capital
expenditures, as determined in accordance with GAAP, other than (a) Consolidated
Maintenance Capital Expenditures, (b) any expenditures made with proceeds of any
Involuntary Disposition to the extent such expenditures are used to purchase
Property that is the same as or similar to the Property subject to such
Involuntary Disposition and (c) Acquisitions consummated prior to the Closing
Date and Permitted Acquisitions consummated after the Closing Date.
"Consolidated Interest Charges" means, for any period for the Borrower
and its Subsidiaries on a consolidated basis, all interest expense of the
Borrower and its Subsidiaries for such period determined in accordance with GAAP
(including, without limitation, the portion of rent expense of the Borrower and
its Subsidiaries with respect to such period under capital leases that is
treated as interest in accordance with GAAP).
"Consolidated Maintenance Capital Expenditures" means, for any period,
for the Borrower and its Subsidiaries on a consolidated basis, all maintenance
capital expenditures, as determined in accordance with GAAP, other than any
expenditures made with proceeds of any Involuntary Disposition to the extent
such expenditures are used to purchase Property that is the same as or similar
to the Property subject to such Involuntary Disposition.
"Consolidated Net Income" means, for any period for the Borrower and
its Subsidiaries on a consolidated basis, the net income of the Borrower and its
Subsidiaries for such period as determined in accordance with GAAP, but
excluding for all purposes (other than the calculation of Consolidated Net
Income for purposes of Section 8.11(d)) extraordinary gains and related tax
effects thereon.
"Consolidated Net Worth" means, as of any date of determination,
consolidated shareholders' equity of the Borrower and its Subsidiaries as of
such date determined in accordance with GAAP.
"Consolidated Scheduled Funded Debt Payments" means, for any period for
the Borrower and its Subsidiaries on a consolidated basis, the sum of all
scheduled payments of principal on Consolidated Funded Indebtedness, as
determined in accordance with GAAP. For purposes of this definition, "scheduled
payments of principal" (a) shall be determined without giving effect to any
reduction of such scheduled payments resulting from the application of any
voluntary or mandatory prepayments made during the applicable period, (b) shall
be deemed to include the Attributable Indebtedness in respect of capital leases,
Synthetic Leases and Sale and Leaseback Transactions and (c) shall not include
any voluntary prepayments or mandatory prepayments required pursuant to Section
2.05.
"Consolidated Senior Leverage Ratio" means, as of any date of
determination, the ratio of (a) Consolidated Funded Indebtedness (other than the
Senior Subordinated Notes) as of such date to (b) Consolidated EBITDA for the
period of the four fiscal quarters most recently ended.
"Consolidated Total Leverage Ratio" means, as of any date of
determination, the ratio of (a) the sum of (i) Consolidated Funded Indebtedness
as of such date minus (ii) the sum of (A) the aggregate amount of cash and Cash
Equivalents of the Borrower and its Subsidiaries on such date minus (B) $10
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million minus (C) the aggregate amount of Loans outstanding on such date to (b)
Consolidated EBITDA for the period of the four fiscal quarters most recently
ended.
"Contract Provider" means any Person or any employee, agent or
subcontractor of such Person who provides professional health care services
under or pursuant to any contract with the Borrower or any Subsidiary.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
Property is bound.
"Control" has the meaning specified in the definition of "Affiliate."
"Credit Extension" means each of the following: (a) a Borrowing and (b)
a L/C Credit Extension.
"Debt Issuance" means the issuance by the Borrower or any Subsidiary of
any Indebtedness other than Indebtedness permitted under Section 8.03.
"Debtor Relief Laws" means the Bankruptcy Code of the United States,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"Default" means any event or condition that constitutes an Event of
Default or that, with the giving of any notice, the passage of time, or both,
would be an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus
(b) the Applicable Rate, if any, applicable to Base Rate Loans plus (c) 2% per
annum; provided, however, that with respect to a Eurodollar Rate Loan, the
Default Rate shall be an interest rate equal to the interest rate (including any
Applicable Rate) otherwise applicable to such Loan plus 2% per annum, in each
case to the fullest extent permitted by applicable Laws.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Loans participations in L/C Obligations or participations in
Swing Line Loans required to be funded by it hereunder within one Business Day
of the date required to be funded by it hereunder, (b) has otherwise failed to
pay over to the Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute, or (c) has been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding.
"Disposition" or "Dispose" means the sale, transfer, license, lease or
other disposition (including any Sale and Leaseback Transaction) of any Property
by the Borrower or any Subsidiary (including the Capital Stock of any
Subsidiary), including any sale, assignment, transfer or other disposal, with or
without recourse, of any notes or accounts receivable or any rights and claims
associated therewith, but excluding (a) the sale, lease, license, transfer or
other disposition of inventory in the ordinary course of business of the
Borrower and its Subsidiaries, (b) the sale, lease, license, transfer or other
disposition of machinery and equipment no longer used or useful in the conduct
of business of the Borrower and its Subsidiaries, (c) any sale, lease, license,
transfer or other disposition of Property by the Borrower or any Subsidiary to
any Loan Party, (d) any Involuntary Disposition by the Borrower or any
Subsidiary and (e) any sale, lease, license, transfer or other disposition of
Property by any Foreign Subsidiary to another Foreign Subsidiary.
7
"Dollar" and "$" mean lawful money of the United States.
"Domestic Subsidiary" means any Subsidiary that is organized under the
laws of any political subdivision of the United States.
"Earn-Out Obligations" means, with respect to any Acquisition, all
deferred purchase price obligations (including, without limitation, earn-out
payment obligations and other contingent payment obligations) incurred by the
Borrower and any of its Subsidiaries pursuant to the documentation for such
Acquisition (other than any portion of such obligations payable in Capital Stock
of the Borrower). For purposes of Section 8.03, the amount of any "Earn-Out
Obligation" shall be the liability in respect thereof as recorded on the balance
sheet of the Borrower and its Subsidiaries in accordance with GAAP.
"Eligible Accounts" means, as of any date of determination and without
duplication, all accounts receivable of the Borrower or any Subsidiaries (other
than Excluded Subsidiaries) (the "Accounts") as determined in accordance with
GAAP, other than:
(a) any Account that is not subject to a perfected, first priority
Lien to secure the Obligations;
(b) any Account that is subject to any other Lien that is not a
Permitted Lien;
(c) any Account with respect to which more than 120 days have
elapsed since the date of the original invoice therefor;
(d) any Account owing by an account debtor that is not solvent or
is subject to any bankruptcy or insolvency proceeding of any kind;
(e) any Account evidenced by a promissory note, chattel paper or
other instrument, unless such note, chattel paper or instrument has been
delivered to and are in the possession of the Administrative Agent;
(f) any Account owing by an account debtor that is not organized
under the laws of the United States or any state thereof;
(g) any Account that is contingent or subject to offset,
deduction, counterclaim, dispute or other defense to payment, in each case to
the extent of such offset, deduction, counterclaim, dispute or other defense;
(h) any Account which arises out of a transaction not made in the
ordinary course of business;
(i) any Account for which the Borrower, any Subsidiary or any
Affiliate of the Borrower is the account debtor; and
(j) any Account which fails to meet such other specifications and
requirements as may from time to time be established by the Administrative Agent
in its reasonable discretion.
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender;
(c) an Approved Fund; and (d) any other Person (other than a natural person)
approved by (i) the Administrative Agent, the L/C Issuer and the Swing Line
Lender, and (ii) unless an Event of Default has occurred and is continuing, the
Borrower (each such approval not to be unreasonably withheld or delayed);
provided that notwithstanding
8
the foregoing, "Eligible Assignee" shall not include the Borrower or any of the
Borrower's Affiliates or Subsidiaries.
"Eligible Unbilled Accounts" means, as of any date of determination and
without duplication, all amounts owing to the Borrower or any Subsidiaries
(other than Excluded Subsidiaries) for goods sold or leased or services rendered
but not billed, as determined in accordance with GAAP, provided that such
amounts, if billed as of the date of determination, would constitute Eligible
Accounts.
"Environmental Laws" means any and all federal, state, local, foreign
and other applicable statutes, laws, regulations, ordinances, rules, judgments,
orders, decrees, permits, concessions, grants, franchises, licenses, agreements
or governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including
those related to hazardous substances or wastes, air emissions and discharges to
waste or public systems.
"Environmental Liability" means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Subsidiary directly or
indirectly resulting from or based upon (a) violation of any Environmental Law,
(b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.
"Equity Issuance" means any issuance by the Borrower or any Subsidiary
to any Person of shares of its Capital Stock, other than (a) any issuance of
shares of its Capital Stock pursuant to the exercise of options or warrants, (b)
any issuance of shares of its Capital Stock pursuant to the conversion of any
debt securities to equity or the conversion of any class equity securities to
any other class of equity securities and (c) any issuance by the Borrower of
shares of its Capital Stock as consideration for a Permitted Acquisition. The
term "Equity Issuance" shall not be deemed to include any Disposition.
"Equity Offering" means the public offering of the common stock of the
Borrower consummated in December 2003 pursuant to which the Borrower received
cash proceeds of approximately $50 million.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not
incorporated) under common control with the Borrower within the meaning of
Section 414(b) or (c) of the Internal Revenue Code (and Sections 414(m) and (o)
of the Internal Revenue Code for purposes of provisions relating to Section 412
of the Internal Revenue Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension
Plan; (b) a withdrawal by the Borrower or any ERISA Affiliate from a Pension
Plan subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by the Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon the Borrower
or any ERISA Affiliate.
9
"Eurodollar Base Rate" means, for any Interest Period with respect to
any Eurodollar Rate Loan:
(a) the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate that appears on the
page of the Telerate screen (or any successor thereto) that displays an
average British Bankers Association Interest Settlement Rate for
deposits in Dollars (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period, determined as
of approximately 11:00 a.m. (London time) two Business Days prior to
the first day of such Interest Period, or
(b) if the rate referenced in the preceding clause (a)
does not appear on such page or service or such page or service shall
not be available, the rate per annum equal to the rate determined by
the Administrative Agent to be the offered rate on such other page or
other service that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the
first day of such Interest Period) with a term equivalent to such
Interest Period, determined as of approximately 11:00 a.m. (London
time) two Business Days prior to the first day of such Interest Period,
or
(c) if the rates referenced in the preceding clauses (a)
and (b) are not available, the rate per annum (rounded upward to the
next 1/100th of 1%) determined by the Administrative Agent as the rate
of interest at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of
the Eurodollar Rate Loan being made, continued or converted by Bank of
America and with a term equivalent to such Interest Period would be
offered by Bank of America's London Branch to major banks in the London
interbank eurodollar market at their request at approximately 4:00 p.m.
(London time) two Business Days prior to the first day of such Interest
Period.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan, a rate per annum determined by the Administrative Agent to
be equal to the quotient obtained by dividing (a) the Eurodollar Base Rate for
such Eurodollar Loan for such Interest Period by (b) one minus the Eurodollar
Reserve Percentage for such Eurodollar Loan for such Interest Period.
"Eurodollar Rate Loan" means a Loan that bears interest at a rate based
on the Eurodollar Rate.
"Eurodollar Reserve Percentage" means, for any day during any Interest
Period, the reserve percentage (expressed as a decimal, carried out to five
decimal places) in effect on such day, whether or not applicable to any Lender,
under regulations issued from time to time by the FRB for determining the
maximum reserve requirement (including any emergency, supplemental or other
marginal reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The Eurodollar Rate for each
outstanding Eurodollar Rate Loan shall be adjusted automatically as of the
effective date of any change in the Eurodollar Reserve Percentage.
"Event of Default" has the meaning specified in Section 9.01.
"Excluded Property" means, with respect to any Loan Party (a) any owned
real Property that has a fair market value of less than $2,500,000 unless
requested by the Administrative Agent or the Required Lenders, (b) any leased
real Property unless requested by the Administrative Agent or the Required
Lenders, (c) any owned or leased real or personal Property which is located
outside of the United States unless requested by the Administrative Agent or the
Required Lenders, (d) any leased personal Property unless requested by the
Administrative Agent or the Required Lenders, (e) any personal Property
(including, without limitation, motor vehicles) in respect of which perfection
of a Lien is not either (i)
10
governed by the Uniform Commercial Code or (ii) effected by appropriate evidence
of the Lien being filed in either the United States Copyright Office or the
United States Patent and Trademark Office, unless requested by the
Administrative Agent or the Required Lenders, (f) any Property which, subject to
the terms of Section 8.09, is subject to a Lien of the type described in Section
8.01(i) pursuant to documents which prohibit such Loan Party from granting any
other Liens in such Property and (g) any lease, license or other contract if the
grant of a security interest in such lease, license or contract is prohibited by
the terms of such lease, license or contract or by law and would result in the
termination of such lease, license or contract, but only to the extent that (i)
after reasonable efforts, consent from the relevant party or parties has not
been obtained and (ii) any such prohibition could not be rendered ineffective
pursuant to the UCC or any other applicable law (including Debtor Relief Laws)
or principles of equity.
"Excluded Subsidiaries" means, collectively, PSI Surety and the HUD
Financing Subsidiaries.
"Existing Credit Agreement" means Second Amended and Restated Revolving
Credit and Term Loan Agreement dated as of June 30, 2003 among Borrower, the
Subsidiaries of the Borrower identified therein, the lenders identified therein
and CapitalSource Finance, LLC, as agent, as amended, modified and supplemented.
"Exclusion Event" means an event or events resulting in the exclusion
of the Borrower or any Subsidiary or any of the Facilities from participation in
any Medical Reimbursement Program.
"Facilities" means, at any time, a collective reference to the
facilities and real properties owned, leased, managed or operated by the
Borrower or any Subsidiary.
"Federal Funds Rate" means, for any day, the rate per annum 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 on the Business Day next
succeeding such day; provided that (a) 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 (b) 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 (rounded upward,
if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on
such day on such transactions as determined by the Administrative Agent.
"Fee Letter" means the letter agreement dated as of December 19, 2003
among the Borrower, the Administrative Agent and the Arranger.
"Foreign Lender" has the meaning specified in Section 11.15(a)(i).
"Foreign Subsidiary" means any Subsidiary that is not a Domestic
Subsidiary.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"Fund" means any Person (other than a natural person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"Funded Indebtedness" means, as to any Person at a particular time,
without duplication, all of the following, whether or not included as
indebtedness or liabilities in accordance with GAAP:
11
(a) all obligations for borrowed money, whether current
or long-term (including the Obligations) and all obligations of such
Person evidenced by bonds, debentures, notes, loan agreements or other
similar instruments;
(b) all purchase money indebtedness;
(c) the principal portion of all obligations under
conditional sale or other title retention agreements relating to
Property purchased by such Person (other than customary reservations or
retentions of title under agreements with suppliers entered into in the
ordinary course of business);
(d) the maximum amount available to be drawn under
letters of credit (including standby and commercial), bankers'
acceptances, bank guaranties, surety bonds and similar instruments;
(e) all obligations in respect of the deferred purchase
price of Property or services (other than trade accounts payable in the
ordinary course of business);
(f) Attributable Indebtedness in respect of capital
leases, Synthetic Leases, Sale and Leaseback Transactions and
Securitization Transactions;
(g) all preferred stock or other equity interests
providing for mandatory redemptions, sinking fund or like payments
prior to the Maturity Date ("Redeemable Stock"); provided that
Redeemable Stock shall not include (i) the Series A Convertible
Preferred Stock of the Borrower, provided that (A) an event giving rise
to a mandatory redemption shall also be a "Change of Control" and (B)
the holders thereof shall have consented to the provisions of Section
8.06 or (ii) any other preferred or other equity interest subject to
mandatory redemption if (A) such mandatory redemption may be satisfied
by delivering common stock or some other equity interest not subject to
mandatory redemption or (B) such mandatory redemption is triggered
solely by reason of a "change of control" and is not required to be
paid until after the Obligations are paid in full;
(h) all Funded Indebtedness of others to the extent
secured by (or for which the holder of such Funded Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien on,
or payable out of the proceeds of production from, Property owned or
acquired by such Person, whether or not the obligations secured thereby
have been assumed;
(i) all Guarantees with respect to Funded Indebtedness of
the types specified in clauses (a) through (h) above of another Person;
and
(j) all Funded Indebtedness of the types referred to in
clauses (a) through (i) above of any partnership or joint venture
(other than a joint venture that is itself a corporation or limited
liability company) in which such Person is a general partner or joint
venturer, unless such Funded Indebtedness is expressly made
non-recourse to such Person.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board, consistently
applied and as in effect from time to time.
12
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"Governmental Reimbursement Program Cost" means with respect to and
payable by the Borrower and its Subsidiaries the sum of:
(a) all amounts (including punitive and other similar
amounts) agreed to be paid or payable (i) in settlement of claims or
(ii) as a result of a final, non-appealable judgment, award or similar
order, in each case, relating to participation in Medical Reimbursement
Programs;
(b) all final, non-appealable fines, penalties,
forfeitures or other amounts rendered pursuant to criminal indictments
or other criminal proceedings relating to participation in Medical
Reimbursement Programs; and
(c) the amount of final, non-appealable recovery,
damages, awards, penalties, forfeitures or similar amounts rendered in
any litigation, suit, arbitration, investigation, review or other legal
or administrative proceeding of any kind relating to participation in
Medical Reimbursement Programs.
"Guarantee" means, as to any Person, (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor") in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in good
faith. The term "Guarantee" as a verb has a corresponding meaning.
"Guaranty" means the Guaranty made by the Guarantors in favor of the
Administrative Agent and the Lenders pursuant to Article IV.
"Guarantors" means each Person identified as a "Guarantor" on the
signature pages hereto and each other Person that joins as a Guarantor pursuant
to Section 7.12, together with their successors and permitted assigns.
"Hazardous Materials" means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos-containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.
13
"HHS" means the United States Department of Health and Human Services
and any successor thereof.
"Honor Date" has the meaning set forth in Section 2.03(c)(i).
"HIPAA" means the Health Insurance Portability and Accountability Act
of 1996, Pub. L. 104-191, Aug. 21, 1996, 110 Stat. 1936.
"HUD Financing" means Indebtedness of HUD Financing Subsidiaries that
is insured by the Federal Housing Administration, an organizational unit of the
United States Department of Housing and Urban Development.
"HUD Financing Subsidiaries" means each of the following Subsidiaries
so long as the documents governing the HUD Financing prohibit such Subsidiaries
from becoming Guarantors: Xxxxx Xxxx Real Estate, LLC, a North Carolina limited
liability company, PSI Cedar Springs Hospital Real Estate, Inc., a Colorado
corporation, Psychiatric Solutions of Oklahoma Real Estate, Inc., an Oklahoma
corporation, Riveredge Real Estate, Inc., an Illinois corporation, Cypress Creek
Real Estate, L.P., a Texas limited partnership, Neuro Rehab Real Estate, L.P., a
Texas limited partnership, Texas Xxxxxx Xxxxx Hospital Real Estate, L.P., a
Texas limited partnership, Texas Oaks Psychiatric Hospital Real Estate, L.P., a
Texas limited partnership, Texas San Marcos Treatment Center Real Estate, L.P.,
a Texas limited partnership, and West Oaks Real Estate, L.P., a Texas limited
partnership.
"Immaterial Subsidiary" means any Subsidiary that, as of any date of
determination, has total assets with an aggregate fair market value of less than
$10,000.
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a) all Funded Indebtedness;
(b) the Swap Termination Value of any Swap Contract;
(c) all Guarantees with respect to outstanding
Indebtedness of the types specified in clauses (a) and (b) above of any
other Person; and
(d) all Indebtedness of the types referred to in clauses
(a) through (c) above of any partnership or joint venture (other than a
joint venture that is itself a corporation or limited liability
company) in which such Person is a general partner or joint venturer
unless such Indebtedness is expressly made non-recourse to such Person.
"Indemnified Liabilities" has the meaning set forth in Section 11.05.
"Indemnitees" has the meaning set forth in Section 11.05.
"Interest Payment Date" means (a) as to any Eurodollar Rate Loan, the
last day of each Interest Period applicable to such Eurodollar Rate Loan and the
Maturity Date; provided, however, that if any Interest Period for a Eurodollar
Rate Loan exceeds three months, the respective dates that fall every three
months after the beginning of such Interest Period shall also be Interest
Payment Dates; and (b) as to any Base Rate Loan and any Swing Line Loan, the
last Business Day of each March, June, September and December and the Maturity
Date.
14
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one, two, three or
six months thereafter, as selected by the Borrower in its Loan Notice; provided
that:
(i) any Interest Period that would otherwise end on a day
that is not a Business Day shall be extended to the next succeeding
Business Day unless such Business Day falls in another calendar month,
in which case such Interest Period shall end on the next preceding
Business Day;
(ii) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of the calendar month at the
end of such Interest Period; and
(iii) no Interest Period shall extend beyond the Maturity
Date.
"Interim Financial Statements" means the unaudited consolidated
financial statements of the Borrower and its Subsidiaries dated September 30,
2003 and the related consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal quarter ended on that date.
"Internal Revenue Code" means the Internal Revenue Code of 1986.
"Investment" means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the purchase
or other acquisition of Capital Stock of another Person, (b) a loan, advance or
capital contribution to, Guarantee or assumption of debt of, or purchase or
other acquisition of any other debt or equity participation or interest in,
another Person, including any partnership or joint venture interest in such
other Person, or (c) an Acquisition. For purposes of covenant compliance, the
amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such
Investment.
"Involuntary Disposition" means any loss of, damage to or destruction
of, or any condemnation or other taking for public use of, any Property of the
Borrower or any Subsidiary.
"IP Rights" has the meaning set forth in Section 6.17.
"IRS" means the United States Internal Revenue Service.
"ISP98" has the meaning set forth in Section 2.03(h).
"Joinder Agreement" means a joinder agreement substantially in the form
of Exhibit F executed and delivered by a Domestic Subsidiary in accordance with
the provisions of Section 7.12.
"Laws" means, collectively, all international, foreign, federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
15
"L/C Advance" means, with respect to each Lender, such Lender's funding
of its participation in any L/C Borrowing in accordance with its Pro Rata Share.
"L/C Borrowing" means an extension of credit resulting from a drawing
under any Letter of Credit which has not been reimbursed on the date when made
or refinanced as a Borrowing of Revolving Loans.
"L/C Credit Extension" means, with respect to any Letter of Credit, the
issuance thereof or extension of the expiry date thereof, or the renewal or
increase of the amount thereof.
"L/C Issuer" means Bank of America in its capacity as issuer of Letters
of Credit hereunder, or any successor issuer of Letters of Credit hereunder.
"L/C Obligations" means, as at any date of determination, the aggregate
undrawn amount of all outstanding Letters of Credit plus the aggregate of all
Unreimbursed Amounts, including all L/C Borrowings. For all purposes of this
Agreement, if on any date of determination a Letter of Credit has expired by its
terms but any amount may still be drawn thereunder by reason of the operation of
Rule 3.14 of the ISP98, such Letter of Credit shall be deemed to be
"outstanding" in the amount so remaining available to be drawn.
"Lender" means each Person identified as a "Lender" on the signature
pages hereto and its successors and assigns and, as the context requires,
includes the L/C Issuer and the Swing Line Lender.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify the Borrower
and the Administrative Agent.
"Letter of Credit" means any standby letter of credit issued hereunder.
"Letter of Credit Application" means an application and agreement for
the issuance or amendment of a letter of credit in the form from time to time in
use by the L/C Issuer.
"Letter of Credit Expiration Date" means the day that is thirty days
prior to the Maturity Date then in effect (or, if such day is not a Business
Day, the next preceding Business Day).
"Letter of Credit Sublimit" means an amount equal to the lesser of the
Aggregate Revolving Commitments and $5,000,000. The Letter of Credit Sublimit is
part of, and not in addition to, the Aggregate Revolving Commitments.
"Lien" means any mortgage, pledge, hypothecation, collateral
assignment, deposit arrangement, encumbrance, lien (statutory or other), charge,
or preference, priority or other security interest or preferential arrangement
of any kind or nature whatsoever (including any conditional sale or other title
retention agreement, and any financing lease having substantially the same
economic effect as any of the foregoing).
"Loan" means an extension of credit by a Lender to the Borrower under
Article II in the form of a Revolving Loan or a Swing Line Loan.
"Loan Documents" means this Agreement, each Note, each Letter of
Credit, each Letter of Credit Application, each Joinder Agreement, the
Collateral Documents, each Request for Credit Extension, each Compliance
Certificate, the Fee Letter and each other document, instrument or agreement
from time to
16
time executed by the Borrower or any Subsidiary or any Responsible Officer
thereof and delivered in connection with this Agreement.
"Loan Notice" means a notice of (a) a Borrowing of Revolving Loans, (b)
a conversion of Loans from one Type to the other, or (c) a continuation of
Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall
be substantially in the form of Exhibit A.
"Loan Parties" means, collectively, the Borrower and each Guarantor.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent), condition (financial or otherwise) or prospects of the
Borrower and its Subsidiaries taken as a whole; (b) a material impairment of the
ability of the Loan Parties taken as a whole to perform their obligations under
the Loan Documents; or (c) a material adverse effect upon the legality,
validity, binding effect or enforceability against any Loan Party of any Loan
Document to which it is a party.
"Maturity Date" means January 6, 2007.
"Medicaid" means that means-tested entitlement program under Title XIX
of the Social Security Act, which provides federal grants to states for medical
assistance based on specific eligibility criteria, as set forth at Section 1396,
et seq. of Title 42 of the United Sates Code, as amended, and any statute
succeeding thereto.
"Medicaid Provider Agreement" means an agreement entered into between a
state agency or other such entity administering the Medicaid program and a
health care provider or supplier under which the health care provider or
supplier agrees to provide items and services for Medicaid patients in
accordance with the terms of the agreement and Medicaid Regulations.
"Medicaid Regulations" means, collectively, (i) all federal statutes
(whether set forth in Title XIX of the Social Security Act or elsewhere)
affecting the medical assistance program established by Title XIX of the Social
Security Act and any statutes succeeding thereto; (ii) all applicable provisions
of all federal rules, regulations, manuals and orders of all 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 all Governmental Authorities having the
force of law promulgated pursuant to or in connection with the statutes
described in clause (ii) above, in each case as may be amended, supplemented or
otherwise modified from time to time.
"Medical Reimbursement Programs" means a collective reference to the
Medicare, Medicaid and TRICARE programs and any other health care program
operated by or financed in whole or in part by any foreign or domestic federal,
state or local government and any other non-government funded third party payor
programs.
"Medicare" means that government-sponsored entitlement program under
Title XVIII of the Social Security Act, which provides for a health insurance
system for eligible elderly and disabled individuals, as set forth at Section
1395, et seq. of Title 42 of the United States Code, as amended, and any statute
succeeding thereto.
17
"Medicare Provider Agreement" means an agreement entered into between
CMS or other such entity administering the Medicare program on behalf of CMS,
and a health care provider or supplier under which the health care provider or
supplier agrees to provide items and services for Medicare patients in
accordance with the terms of the agreement and Medicare Regulations.
"Medicare Regulations" means, collectively, all federal statutes
(whether set forth in Title XVIII of the Social Security Act or elsewhere)
affecting the health insurance program for the aged and disabled established by
Title XVIII of the Social Security Act and any statutes succeeding thereto;
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, CMS, the
OIG, 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, supplemented or otherwise modified from
time to time.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor
thereto.
"Mortgage Instrument" means each mortgage, deed of trust, deed to
secure debt or like instrument given by any Loan Party to the Administrative
Agent to secure the Obligations, in each case as amended, modified and
supplemented from time to time.
"Mortgage Policy" has the meaning set forth in Section 7.15.
"Mortgage Property" has the meaning set forth in Section 7.15.
"Multiemployer Plan" means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any ERISA
Affiliate makes or is obligated to make contributions, or during the preceding
five plan years, has made or been obligated to make contributions.
"Net Cash Proceeds" means the aggregate cash or Cash Equivalents
proceeds received by the Borrower or any Subsidiary in respect of any
Disposition, Involuntary Disposition, Debt Issuance or Equity Issuance, net of
(a) direct costs incurred in connection therewith (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions), (b) taxes paid or payable as a result thereof and (c) in the case
of any Disposition or Involuntary Disposition, the amount necessary to retire
any Indebtedness secured by a Permitted Lien (ranking senior to any Lien of the
Administrative Agent) on the related Property; it being understood that "Net
Cash Proceeds" shall include, without limitation, any cash or Cash Equivalents
received upon the sale or other disposition of any non-cash consideration
received by the Borrower or any Subsidiary in any Disposition, Involuntary
Disposition, Debt Issuance or Equity Issuance.
"Note" or "Notes" means the Revolving Notes and/or the Swing Line Note,
individually or collectively, as appropriate.
"Obligations" means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against any
Loan Party or any Affiliate thereof of any proceeding under any Debtor Relief
Laws naming such Person as the debtor in such proceeding, regardless of whether
such interest and fees are allowed claims in such proceeding. The foregoing
shall also include any Swap Contract and any Treasury Management Agreement
between any Loan Party and any Lender or Affiliate of a Lender.
18
"OIG" means the Office of Inspector General of HHS and any successor
thereof.
"Organization Documents" means, (a) with respect to any corporation,
the certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Outstanding Amount" means (i) with respect to any Loans on any date,
the aggregate outstanding principal amount thereof after giving effect to any
borrowings and prepayments or repayments of any Loans occurring on such date;
and (ii) with respect to any L/C Obligations on any date, the amount of such L/C
Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of
outstanding unpaid drawings under any Letters of Credit or any reductions in the
maximum amount available for drawing under Letters of Credit taking effect on
such date.
"Participant" has the meaning specified in Section 11.07(d).
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by the Borrower or
any ERISA Affiliate or to which the Borrower or any ERISA Affiliate contributes
or has an obligation to contribute, or in the case of a multiple employer or
other plan described in Section 4064(a) of ERISA, has made contributions at any
time during the immediately preceding five plan years.
"Permitted Acquisitions" means Investments consisting of an Acquisition
by the Borrower or any Subsidiary, provided that (i) the Property acquired (or
the Property of the Person acquired) in such Acquisition is used or useful in
the same or a similar line of business as the Borrower and its Subsidiaries were
engaged in on the Closing Date (or any reasonable extensions or expansions
thereof), (ii) the Administrative Agent shall have received all items in respect
of the Capital Stock or Property acquired in such Acquisition required to be
delivered by the terms of Section 7.12 and/or Section 7.14, (iii) in the case of
an Acquisition of the Capital Stock of another Person, the board of directors
(or other comparable governing body) of such other Person shall have duly
approved such Acquisition, (iv) the Borrower shall have delivered to the
Administrative Agent a Pro Forma Compliance Certificate demonstrating that, upon
giving effect to such Acquisition on a Pro Forma Basis, the Loan Parties would
be in compliance with the financial covenants set forth in Section 8.11 as of
the most recent fiscal quarter for which the Borrower has delivered financial
statements pursuant to Section 7.01(a) or (b), (v) the representations and
warranties made by the Loan Parties in any Loan Document shall be true and
correct in all material respects at and as if made as of the date of such
Acquisition (after giving effect thereto) except to the extent such
representations and warranties expressly relate to an earlier date, (vi) if such
transaction involves the purchase of an interest in a partnership between the
Borrower (or a Subsidiary of the Borrower) as a general partner and entities
unaffiliated with the Borrower or such Subsidiary as the other partners, such
transaction shall be effected by having such equity interest acquired by a
corporate holding company directly or indirectly wholly-owned by
19
the Borrower newly formed for the sole purpose of effecting such transaction,
and (vii) either (A) the Total Consideration paid by the Borrower or any
Subsidiary for any Acquisition (or any series of related Acquisitions) shall not
exceed $20 million and the Total Consideration paid by the Borrower and its
Subsidiaries for all Acquisitions in any fiscal year shall not exceed an amount
equal to Consolidated EBITDA on a Pro Forma Basis for the period of four
consecutive fiscal quarters immediately preceding the date of determination or
(B) the Required Lenders shall have consented to such Acquisition, such consent
not to be unreasonably withheld or delayed or, so long as such consent does not
include or require any amendment or waiver to the Loan Documents (other than the
consent under this clause (B)), conditioned upon the payment of any consent,
waiver or amendment fee.
"Permitted Investments" means, at any time, Investments by the Borrower
and its Subsidiaries permitted to exist at such time pursuant to the terms of
Section 8.02.
"Permitted Liens" means, at any time, Liens in respect of Property of
the Borrower and its Subsidiaries permitted to exist at such time pursuant to
the terms of Section 8.01.
"Person" means any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by the Borrower or, with respect to any such
plan that is subject to Section 412 of the Internal Revenue Code or Title IV of
ERISA, any ERISA Affiliate.
"Pledge Agreement" means the Amended and Restated Pledge Agreement
dated as of the Closing Date executed in favor of the Administrative Agent by
each of the Loan Parties, as amended, modified and supplemented from time to
time.
"Pro Forma Basis" means, for purposes of calculating the financial
covenants in Section 8.11 (including for purposes of determining the Applicable
Rate), that any Disposition, Involuntary Disposition or Acquisition shall be
deemed to have occurred as of the first day of the most recent four fiscal
quarter period preceding the date of such transaction for which the Borrower has
delivered financial statements pursuant to Section 7.01(a) or (b). In connection
with the foregoing, (a) with respect to any Disposition or Involuntary
Disposition, (i) income statement and cash flow statement items (whether
positive or negative) attributable to the Property disposed of shall be excluded
to the extent relating to any period occurring prior to the date of such
transaction and (ii) Indebtedness which is retired shall be excluded and deemed
to have been retired as of the first day of the applicable period and (b) with
respect to any Acquisition, (i) income statement items attributable to the
Person or Property acquired shall be included to the extent relating to any
period applicable in such calculations to the extent (A) such items are not
otherwise included in such income statement items for the Borrower and its
Subsidiaries in accordance with GAAP or in accordance with any defined terms set
forth in Section 1.1 and (B) such items are supported by financial statements or
other information reasonably satisfactory to the Administrative Agent and (ii)
any Indebtedness incurred or assumed by the Borrower or any Subsidiary
(including the Person or Property acquired) in connection with such transaction
and any Indebtedness of the Person or Property acquired which is not retired in
connection with such transaction (A) shall be deemed to have been incurred as of
the first day of the applicable period and (B) if such Indebtedness has a
floating or formula rate, shall have an implied rate of interest for the
applicable period for purposes of this definition determined by utilizing the
rate which is or would be in effect with respect to such Indebtedness as at the
relevant date of determination.
"Pro Forma Compliance Certificate" means a certificate of a Responsible
Officer of the Borrower containing reasonably detailed calculations of the
financial covenants set forth in Section 8.11 as of the
20
most recent fiscal quarter end for which the Borrower has delivered financial
statements pursuant to Section 7.01(a) or (b) after giving effect to the
applicable transaction on a Pro Forma Basis.
"Pro Rata Share" means, as to each Lender, a fraction (expressed as a
percentage, carried out to the ninth decimal place), the numerator of which is
the amount of the Revolving Commitment of such Lender at such time and the
denominator of which is the amount of the Aggregate Revolving Commitments at
such time; provided that if the commitment of each Lender to make Revolving
Loans and the obligation of the L/C Issuer to make L/C Credit Extensions have
been terminated pursuant to Section 9.02, then the Pro Rata Share of each Lender
shall be determined based on the Pro Rata Share of such Lender immediately prior
to such termination and after giving effect to any subsequent assignments made
pursuant to the terms hereof. The initial Pro Rata Share of each Lender is set
forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and
Assumption pursuant to which such Lender becomes a party hereto, as applicable.
"Property" means any interest of any kind in any property or asset,
whether real, personal or mixed, or tangible or intangible.
"PSI Surety" means PSI Surety, Inc., a Montana corporation.
"Register" has the meaning set forth in Section 11.07(c).
"Reportable Event" means any of the events set forth in Section 4043(c)
of ERISA, other than events for which the thirty-day notice period has been
waived.
"Request for Credit Extension" means (a) with respect to a Borrowing,
conversion or continuation of Loans, a Loan Notice, (b) with respect to an L/C
Credit Extension, a Letter of Credit Application, and (c) with respect to a
Swing Line Loan, a Swing Line Loan Notice.
"Required Lenders" means, at any time, Lenders holding in the aggregate
more than fifty percent (50%) of (a) the Revolving Commitments or (b) if the
Revolving Commitments have been terminated, the outstanding Loans, L/C
Obligations, Swing Line Loans and participations therein. The Revolving
Commitment of any Defaulting Lender shall be excluded for purposes of making a
determination of Required Lenders.
"Responsible Officer" means the chief executive officer, president,
chief financial officer, or treasurer of a Loan Party. Any document delivered
hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate,
partnership and/or other action on the part of such Loan Party and such
Responsible Officer shall be conclusively presumed to have acted on behalf of
such Loan Party.
"Restricted Payment" means any dividend or other distribution (whether
in cash, securities or other property) with respect to any Capital Stock of the
Borrower or any Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Capital Stock or of any option, warrant or other right to acquire any
such Capital Stock.
"Revolving Commitment" means, as to each Lender, its obligation to (a)
make Revolving Loans to the Borrower pursuant to Section 2.01, (b) purchase
participations in L/C Obligations, and (c) purchase participations in Swing Line
Loans, in an aggregate principal amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 2.01 or in
the Assignment and
21
Assumption pursuant to which such Lender becomes a party hereto, as applicable,
as such amount may be adjusted from time to time in accordance with this
Agreement.
"Revolving Loan" has the meaning specified in Section 2.01(a).
"Revolving Note" has the meaning specified in Section 2.11(a).
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. and any successor thereto.
"Sale and Leaseback Transaction" means, with respect to the Borrower or
any Subsidiary, any arrangement, directly or indirectly, with any Person whereby
the Borrower or such Subsidiary shall sell or transfer any property, real or
personal, used or useful in its business, whether now owned or hereafter
acquired, and thereafter rent or lease such property or other property that it
intends to use for substantially the same purpose or purposes as the property
being sold or transferred.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Securitization Transaction" means any financing transaction or series
of financing transactions (including factoring arrangements) pursuant to which
the Borrower or any Subsidiary may sell, convey or otherwise transfer, or grant
a security interest in, accounts, payments, receivables, rights to future lease
payments or residuals or similar rights to payment to a special purpose
subsidiary or affiliate of any Person.
"Security Agreement" means the Amended and Restated Security Agreement
dated as of the Closing Date executed in favor of the Administrative Agent by
each of the Loan Parties, as amended, modified and supplemented from time to
time.
"Senior Subordinated Notes Documents" means (a) the Indenture dated as
of June 30, 2003 between the Borrower, the Subsidiaries party thereto as
guarantors and Wachovia Bank, National Association, as trustee, (b) the Senior
Subordinated Notes, (c) any guaranty agreement given by any Subsidiary in
respect of the Senior Subordinated Notes and (d) all other documents, agreements
and instruments relating to the Senior Subordinated Notes.
"Senior Subordinated Notes" means $150,000,000 aggregate principal
amount of the Borrower's 10 5/8% Senior Subordinated Notes due 2013.
"Social Security Act" means the Social Security Act of 1965 as set
forth in Title 42 of the United States Code, as amended, and any successor
statute thereto, as interpreted by the rules and regulations issued thereunder,
in each case as in effect from time to time.
"Subordinated Indebtedness" means (a) the Senior Subordinated Notes,
(b) the "Subordinated Debt" under, and as defined in, the Sunrise Subordination
Agreement and (c) any other Indebtedness of the Borrower or any Subsidiary which
by its terms is subordinated to the Obligations in a manner and to an extent
acceptable to the Administrative Agent.
"Subordinated Indebtedness Documents" means (a) the Senior Subordinated
Notes Documents, (b) the Sunrise Subordination Agreement and (c) all other
documents, agreements and instruments governing Subordinated Indebtedness.
22
"Subsidiary" of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of Capital Stock having ordinary voting power for the election of
directors or other governing body (other than Capital Stock having such power
only by reason of the happening of a contingency) are at the time beneficially
owned, or the management of which is otherwise controlled, directly, or
indirectly through one or more intermediaries, or both, by such Person. Unless
otherwise specified, all references herein to a "Subsidiary" or to
"Subsidiaries" shall refer to a Subsidiary or Subsidiaries of the Borrower.
"Sunrise Subordination Agreement" means that Subordination Agreement
dated on or about December 1, 2003 by and among Sunrise Girls Home, Inc.,
Bountiful Psychiatric Hospital, Inc., the Borrower and CapitalSource Finance
LLC,
"Swap Contract" means (a) any and all rate swap transactions, basis
swaps, credit derivative transactions, forward rate transactions, commodity
swaps, commodity options, forward commodity contracts, equity or equity index
swaps or options, bond or bond price or bond index swaps or options or forward
bond or forward bond price or forward bond index transactions, interest rate
options, forward foreign exchange transactions, cap transactions, floor
transactions, collar transactions, currency swap transactions, cross-currency
rate swap transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swap Termination Value" means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
xxxx-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"Swing Line Lender" means Bank of America in its capacity as provider
of Swing Line Loans, or any successor swing line lender hereunder.
"Swing Line Loan" has the meaning specified in Section 2.04(a).
"Swing Line Loan Notice" means a notice of a Borrowing of Swing Line
Loans pursuant to Section 2.04(b), which, if in writing, shall be substantially
in the form of Exhibit B.
"Swing Line Note" has the meaning specified in Section 2.11(a).
"Swing Line Sublimit" means an amount equal to the lesser of (a)
$5,000,000 or (b) the Aggregate Revolving Commitments. The Swing Line Sublimit
is part of, and not in addition to, the Aggregate Revolving Commitments.
"Synthetic Lease" means any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing arrangement
whereby the arrangement is considered borrowed
23
money indebtedness for tax purposes but is classified as an operating lease or
does not otherwise appear on a balance sheet under GAAP.
"Threshold Amount" means $3,000,000.
"Total Consideration" means, with respect to any Acquisition, all cash
and non-cash consideration, including, without limitation, the amount of
Indebtedness assumed, the amount reasonably anticipated to be payable in
connection with any deferred purchase price obligation (including any earn-out
obligation) as determined by the Borrower in good faith at the time of the
consummation of such Acquisition, and the value of any Capital Stock of the
Borrower issued to the seller, but excluding any cash consideration funded with
the proceeds of the Equity Offering.
"Total Revolving Outstandings" means the aggregate Outstanding Amount
of all Revolving Loans, all Swing Line Loans and all L/C Obligations.
"Treasury Management Agreements" means any and all agreements governing
the provision of treasury or cash management services, including, without
limitation, deposit accounts, funds transfer, automated clearinghouse, zero
balance accounts, returned check concentration, controlled disbursement,
lockbox, account reconciliation and reporting and trade finance services.
"TRICARE" means the United States Department of Defense health care
program for service families (including TRICARE Prime, TRICARE Extra and TRICARE
Standard), and any successor or predecessor thereof.
"Type" means, with respect to any Loan, its character as a Base Rate
Loan or a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Pension Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Internal
Revenue Code for the applicable plan year.
"United States" and "U.S." mean the United States of America.
"Unreimbursed Amount" has the meaning set forth in Section 2.03(c)(i).
"Voting Stock" means, with respect to any Person, Capital Stock issued
by such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
"Wholly Owned Subsidiary" means any Person 100% of whose Capital Stock
is at the time owned by the Borrower directly or indirectly through other
Persons 100% of whose Capital Stock is at the time owned, directly or
indirectly, by the Borrower.
1.02 OTHER INTERPRETIVE PROVISIONS.
With reference to this Agreement and each other Loan Document, unless
otherwise specified herein or in such other Loan Document:
24
(a) The meanings of defined terms are equally applicable
to the singular and plural forms of the defined terms.
(b) (i) The words "herein," "hereto," "hereof" and
"hereunder" and words of similar import when used in any Loan
Document shall refer to such Loan Document as a whole and not
to any particular provision thereof.
(ii) Article, Section, Exhibit and Schedule
references are to the Loan Document in which such reference
appears.
(iii) The term "including" is by way of example
and not limitation.
(iv) The term "documents" includes any and all
instruments, documents, agreements, certificates, notices,
reports, financial statements and other writings, however
evidenced, whether in physical or electronic form.
(c) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from
and including;" the words "to" and "until" each mean "to but
excluding;" and the word "through" means "to and including."
(d) Section headings herein and in the other Loan
Documents are included for convenience of reference only and shall not
affect the interpretation of this Agreement or any other Loan Document.
1.03 ACCOUNTING TERMS.
(a) Except as otherwise specifically prescribed herein, all
accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial ratios
and other financial calculations) required to be submitted pursuant to this
Agreement shall be prepared in conformity with, GAAP applied on a consistent
basis, as in effect from time to time, applied in a manner consistent with that
used in preparing the most recent Audited Financial Statements; provided,
however, that calculations of Attributable Indebtedness under any Synthetic
Lease or the implied interest component of any Synthetic Lease shall be made by
the Borrower in accordance with accepted financial practice and consistent with
the terms of such Synthetic Lease.
(b) Together with each Compliance Certificate, the Borrower will
provide a written summary of any changes in GAAP that materially impact the
calculation of the financial covenants in Section 8.11 contained in such
Compliance Certificate. If at any time any change in GAAP would affect the
computation of any financial ratio or requirement set forth in any Loan
Document, and either the Borrower or the Required Lenders shall so request, the
Administrative Agent, the Lenders and the Borrower shall negotiate in good faith
to amend such ratio or requirement to preserve the original intent thereof in
light of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and (ii) the
Borrower shall provide to the Administrative Agent and the Lenders financial
statements and other documents required under this Agreement or as reasonably
requested hereunder setting forth a reconciliation between calculations of such
ratio or requirement made before and after giving effect to such change in GAAP.
(c) Notwithstanding the above, the parties hereto acknowledge and
agree that all calculations of the financial covenants in Section 8.11
(including for purposes of determining compliance with such financial covenants
and determining the Applicable Rate) shall be made on a Pro Forma Basis.
25
1.04 ROUNDING.
Any financial ratios required to be maintained by the Borrower pursuant
to this Agreement shall be calculated by dividing the appropriate component by
the other component, carrying the result to one place more than the number of
places by which such ratio is expressed herein and rounding the result up or
down to the nearest number (with a rounding-up if there is no nearest number).
1.05 REFERENCES TO AGREEMENTS AND LAWS.
Unless otherwise expressly provided herein, (a) references to
Organization Documents, agreements (including the Loan Documents) and other
contractual instruments shall be deemed to include all subsequent amendments,
restatements, extensions, supplements and other modifications thereto, but only
to the extent that such amendments, restatements, extensions, supplements and
other modifications are not prohibited by any Loan Document; and (b) references
to any Law shall include all statutory and regulatory provisions consolidating,
amending, replacing, supplementing or interpreting such Law.
1.06 TIMES OF DAY.
Unless otherwise specified, all references herein to times of day shall
be references to Eastern time (daylight or standard, as applicable).
1.07 LETTER OF CREDIT AMOUNTS.
Unless otherwise specified, all references herein to the amount of a
Letter of Credit at any time shall be deemed to mean the maximum face amount of
such Letter of Credit after giving effect to all increases thereof contemplated
by such Letter of Credit or the Letter of Credit Application therefor, whether
or not such maximum face amount is in effect at such time.
ARTICLE II
THE COMMITMENTS AND CREDIT EXTENSIONS
2.01 REVOLVING LOANS.
(a) Subject to the terms and conditions set forth herein, each Lender
severally agrees to make loans (each such loan, a "Revolving Loan") to the
Borrower in Dollars from time to time on any Business Day during the
Availability Period in an aggregate amount not to exceed at any time outstanding
the amount of such Lender's Revolving Commitment; provided, however, that after
giving effect to any Borrowing of Revolving Loans, (i) the Total Revolving
Outstandings shall not exceed the lesser of (A) the Aggregate Revolving
Commitments and (B) the Borrowing Base, and (ii) the aggregate Outstanding
Amount of the Revolving Loans of any Lender, plus such Lender's Pro Rata Share
of the Outstanding Amount of all L/C Obligations, plus such Lender's Pro Rata
Share of the Outstanding Amount of all Swing Line Loans shall not exceed the
lesser of (A) such Lender's Revolving Commitment and (B) an amount equal to such
Lender's Revolving Commitment Percentage of the Borrowing Base. Within the
limits of each Lender's Revolving Commitment, and subject to the other terms and
conditions hereof, the Borrower may borrow under this Section 2.01, prepay under
Section 2.05, and reborrow under this Section 2.01. Revolving Loans may be Base
Rate Loans or Eurodollar Rate Loans, as further provided herein, provided,
however, all Borrowings made on the Closing Date shall be made as Base Rate
Loans.
26
(b) The Borrower may at any time and from time to time, upon prior
written notice by the Borrower to the Administrative Agent, increase the
Aggregate Revolving Commitments by up to THIRTY MILLION DOLLARS ($30,000,000)
with additional Revolving Commitments from any existing Lender or new Revolving
Commitments from any other Person selected by the Borrower and approved by the
Administrative Agent; provided that:
(i) any such increase shall be in a minimum principal
amount of $5 million and in integral multiples of $5 million in excess
thereof;
(ii) no Default shall be continuing at the time of any
such increase;
(iii) no existing Lender shall be under any obligation to
increase its Revolving Commitment and any such decision whether to
increase its Revolving Commitment shall be in such Lender's sole and
absolute discretion; and
(iv) any new Lender shall join this Agreement by executing
such joinder documents reasonably required by the Administrative Agent.
In connection with any such increase in the Aggregate Revolving
Commitments, Schedule 2.01 shall be revised by the Administrative Agent
to reflect the new Revolving Commitments and distributed to the
Lenders.
2.02 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Each Borrowing, each conversion of Loans from one Type to the
other, and each continuation of Eurodollar Rate Loans shall be made upon the
Borrower's irrevocable notice to the Administrative Agent, which may be given by
telephone. Each such notice must be received by the Administrative Agent not
later than 11:00 a.m. (i) three Business Days prior to the requested date of any
Borrowing of, conversion to or continuation of Eurodollar Rate Loans or of any
conversion of Eurodollar Rate Loans to Base Rate Loans, and (ii) on the
requested date of any Borrowing of Base Rate Loans. Each telephonic notice by
the Borrower pursuant to this Section 2.02(b) must be confirmed promptly by
delivery to the Administrative Agent of a written Loan Notice, appropriately
completed and signed by a Responsible Officer of the Borrower. Each Borrowing
of, conversion to or continuation of Eurodollar Rate Loans shall be in a
principal amount of $1,000,000 or a whole multiple of $100,000 in excess
thereof. Except as provided in Sections 2.03(c) and 2.04(c), each Borrowing of
or conversion to Base Rate Loans shall be in a principal amount of $500,000 or a
whole multiple of $100,000 in excess thereof. Each Loan Notice (whether
telephonic or written) shall specify (i) whether the Borrower is requesting a
Borrowing, a conversion of Loans from one Type to the other, or a continuation
of Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion
or continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Loans to be borrowed, converted or continued, (iv) the Type
of Loans to be borrowed or to which existing Loans are to be converted, and (v)
if applicable, the duration of the Interest Period with respect thereto. If the
Borrower fails to specify a Type of Loan in a Loan Notice or if the Borrower
fails to give a timely notice requesting a conversion or continuation, then the
applicable Loans shall be made as, or converted to, Base Rate Loans. Any such
automatic conversion to Base Rate Loans shall be effective as of the last day of
the Interest Period then in effect with respect to the applicable Eurodollar
Rate Loans. If the Borrower requests a Borrowing of, conversion to, or
continuation of Eurodollar Rate Loans in any such Loan Notice, but fails to
specify an Interest Period, it will be deemed to have specified an Interest
Period of one month.
(b) Following receipt of a Loan Notice, the Administrative Agent
shall promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a
27
conversion or continuation is provided by the Borrower, the Administrative Agent
shall notify each Lender of the details of any automatic conversion to Base Rate
Loans described in the preceding subsection. In the case of a Borrowing, each
Lender shall make the amount of its Loan available to the Administrative Agent
in immediately available funds at the Administrative Agent's Office not later
than 1:00 p.m. on the Business Day specified in the applicable Loan Notice. Upon
satisfaction of the applicable conditions set forth in Section 5.02 (and, if
such Borrowing is the initial Credit Extension, Section 5.01), the
Administrative Agent shall make all funds so received available to the Borrower
in like funds as received by the Administrative Agent either by (i) crediting
the account of the Borrower on the books of Bank of America with the amount of
such funds or (ii) wire transfer of such funds, in each case in accordance with
instructions provided to (and reasonably acceptable to) the Administrative Agent
by the Borrower; provided, however, that if, on the date a Borrowing of
Revolving Loans, there are Swing Line Loans or L/C Borrowings outstanding, then
the proceeds of such Borrowing shall be applied, first, to the payment in full
of any such L/C Borrowings, second, to the payment in full of any such Swing
Line Loans, and third, to the Borrower as provided above.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan
may be continued or converted only on the last day of the Interest Period for
such Eurodollar Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to or continued as Eurodollar Rate Loans without the
consent of the Required Lenders, and the Required Lenders may demand that any or
all of the then outstanding Eurodollar Rate Loans be converted immediately to
Base Rate Loans.
(d) The Administrative Agent shall promptly notify the Borrower
and the Lenders of the interest rate applicable to any Interest Period for
Eurodollar Rate Loans upon determination of such interest rate. The
determination of the Eurodollar Rate by the Administrative Agent shall be
conclusive in the absence of manifest error. At any time that Base Rate Loans
are outstanding, the Administrative Agent shall notify the Borrower and the
Lenders of any change in Bank of America's prime rate used in determining the
Base Rate promptly following the public announcement of such change.
(e) After giving effect to all Borrowings, all conversions of
Loans from one Type to the other, and all continuations of Loans as the same
Type, there shall not be more than five (5) Interest Periods in effect with
respect to Revolving Loans.
2.03 LETTERS OF CREDIT.
(a) The Letter of Credit Commitment.
(i) Subject to the terms and conditions set forth herein,
(A) the L/C Issuer agrees, in reliance upon the agreements of the other
Lenders set forth in this Section 2.03, (1) from time to time on any
Business Day during the period from the Closing Date until the Letter
of Credit Expiration Date, to issue Letters of Credit in Dollars for
the account of the Borrower or any of its Subsidiaries, and to amend or
renew Letters of Credit previously issued by it, in accordance with
subsection (b) below, and (2) to honor drafts under the Letters of
Credit; and (B) the Lenders severally agree to participate in Letters
of Credit issued for the account of the Borrower or any of its
Subsidiaries; provided that the L/C Issuer shall not be obligated to
make any L/C Credit Extension with respect to any Letter of Credit, and
no Lender shall be obligated to participate in any Letter of Credit if,
after giving effect to such L/C Credit Extension, (x) the Total
Revolving Outstandings would exceed the lesser of the Aggregate
Revolving Commitments and the Borrowing Base, (y) the aggregate
Outstanding Amount of the Revolving Loans of any Lender, plus such
Lender's Pro Rata Share of the Outstanding Amount of all L/C
Obligations, plus such Lender's Pro Rata Share of the Outstanding
Amount of all Swing Line Loans would exceed the lesser of such Lender's
Revolving Commitment and an amount equal to such Lender's Revolving
28
Commitment Percentage of the Borrowing Base, or (z) the Outstanding
Amount of the L/C Obligations would exceed the Letter of Credit
Sublimit. Within the foregoing limits, and subject to the terms and
conditions hereof, the Borrower's ability to obtain Letters of Credit
shall be fully revolving, and accordingly the Borrower may, during the
foregoing period, obtain Letters of Credit to replace Letters of Credit
that have expired or that have been drawn upon and reimbursed.
(ii) The L/C Issuer shall be under no obligation to issue
any Letter of Credit if:
(A) any order, judgment or decree of any
Governmental Authority or arbitrator shall by its terms
purport to enjoin or restrain the L/C Issuer from issuing such
Letter of Credit, or any Law applicable to the L/C Issuer or
any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over
the L/C Issuer shall prohibit, or request that the L/C Issuer
refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon the
L/C Issuer with respect to such Letter of Credit any
restriction, reserve or capital requirement (for which the L/C
Issuer is not otherwise compensated hereunder) not in effect
on the Closing Date, or shall impose upon the L/C Issuer any
unreimbursed loss, cost or expense which was not applicable on
the Closing Date and which the L/C Issuer in good xxxxx xxxxx
material to it;
(B) subject to Section 2.03(b)(iii), the expiry
date of such requested Letter of Credit would occur more than
twelve months after the date of issuance or last renewal,
unless the Required Lenders have approved such expiry date;
(C) the expiry date of such requested Letter of
Credit would occur after the Letter of Credit Expiration Date,
unless all the Lenders have approved such expiry date;
(D) the issuance of such Letter of Credit would
violate one or more policies of the L/C Issuer; or
(E) such Letter of Credit is in an initial
amount less than $100,000 or is to be denominated in a
currency other than Dollars.
(iii) The L/C Issuer shall be under no obligation to amend
any Letter of Credit if (A) the L/C Issuer would have no obligation at
such time to issue such Letter of Credit in its amended form under the
terms hereof, or (B) the beneficiary of such Letter of Credit does not
accept the proposed amendment to such Letter of Credit.
(iv) The L/C Issuer shall be under no obligation to issue
or amend any Letter of Credit if the L/C Issuer has received written
notice from any Lender, the Administrative Agent or any Loan Party, on
or prior to the Business Day prior to the requested date of issuance or
amendment of such Letter of Credit, that one or more applicable
conditions contained in Article V shall not then be satisfied.
(b) Procedures for Issuance and Amendment of Letters of Credit;
Auto-Renewal Letters of Credit.
(i) Each Letter of Credit shall be issued or amended, as
the case may be, upon the request of the Borrower delivered to the L/C
Issuer (with a copy to the Administrative Agent) in the form of a
Letter of Credit Application, appropriately completed and signed by a
Responsible
29
Officer of the Borrower. Such Letter of Credit Application must be
received by the L/C Issuer and the Administrative Agent not later than
11:00 a.m. at least three Business Days (or such later date and time as
the L/C Issuer may agree in a particular instance in its sole
discretion) prior to the proposed issuance date or date of amendment,
as the case may be. In the case of a request for an initial issuance of
a Letter of Credit, such Letter of Credit Application shall specify in
form and detail satisfactory to the L/C Issuer: (A) the proposed
issuance date of the requested Letter of Credit (which shall be a
Business Day); (B) the amount thereof; (C) the expiry date thereof; (D)
the name and address of the beneficiary thereof; (E) the documents to
be presented by such beneficiary in case of any drawing thereunder; (F)
the full text of any certificate to be presented by such beneficiary in
case of any drawing thereunder; and (G) such other matters as the L/C
Issuer may reasonably require. In the case of a request for an
amendment of any outstanding Letter of Credit, such Letter of Credit
Application shall specify in form and detail satisfactory to the L/C
Issuer (A) the Letter of Credit to be amended; (B) the proposed date of
amendment thereof (which shall be a Business Day); (C) the nature of
the proposed amendment; and (D) such other matters as the L/C Issuer
may reasonably require.
(ii) Promptly after receipt of any Letter of Credit
Application, the L/C Issuer will confirm with the Administrative Agent
(by telephone or in writing) that the Administrative Agent has received
a copy of such Letter of Credit Application from the Borrower and, if
not, the L/C Issuer will provide the Administrative Agent with a copy
thereof. Upon receipt by the L/C Issuer of confirmation from the
Administrative Agent that the requested issuance or amendment is
permitted in accordance with the terms hereof, then, subject to the
terms and conditions hereof, the L/C Issuer shall, on the requested
date, issue a Letter of Credit for the account of the Borrower or enter
into the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer's usual and customary business
practices. Immediately upon the issuance of each Letter of Credit, each
Lender shall be deemed to, and hereby irrevocably and unconditionally
agrees to, purchase from the L/C Issuer a risk participation in such
Letter of Credit in an amount equal to the product of such Lender's Pro
Rata Share times the amount of such Letter of Credit.
(iii) If the Borrower so requests in any applicable Letter
of Credit Application, the L/C Issuer shall issue a Letter of Credit
that has automatic renewal provisions (each, an "Auto-Renewal Letter of
Credit"); provided that any such Auto-Renewal Letter of Credit must
permit the L/C Issuer to prevent any such renewal at least once in each
twelve-month period (commencing with the date of issuance of such
Letter of Credit) by giving prior notice to the beneficiary thereof not
later than a day (the "Nonrenewal Notice Date") in each such
twelve-month period to be agreed upon at the time such Letter of Credit
is issued. Unless otherwise directed by the L/C Issuer, the Borrower
shall not be required to make a specific request to the L/C Issuer for
any such renewal. Once an Auto-Renewal Letter of Credit has been
issued, the Lenders shall be deemed to have authorized (but may not
require) the L/C Issuer to permit the renewal of such Letter of Credit
at any time to an expiry date not later than the Letter of Credit
Expiration Date; provided, however, that the L/C Issuer shall not
permit any such renewal if (A) the L/C Issuer has determined that it
would have no obligation at such time to issue such Letter of Credit in
its renewed form under the terms hereof (by reason of the provisions of
Section 2.03(a)(ii) or otherwise), or (B) it has received notice (which
may be by telephone or in writing) on or before the day that is five
(5) Business Days before the Nonrenewal Notice Date (1) from the
Administrative Agent that the Required Lenders have elected not to
permit such renewal or (2) from the Administrative Agent, any Lender or
the Borrower that one or more of the applicable conditions specified in
Section 5.02 is not then satisfied.
30
(iv) Promptly after its delivery of any Letter of Credit
or any amendment to a Letter of Credit to an advising bank with respect
thereto or to the beneficiary thereof, the L/C Issuer will also deliver
to the Borrower and the Administrative Agent a true and complete copy
of such Letter of Credit or amendment.
(c) Drawings and Reimbursements; Funding of Participations.
(i) Upon receipt from the beneficiary of any Letter of
Credit of any notice of drawing under such Letter of Credit, the L/C
Issuer shall notify the Borrower and the Administrative Agent thereof.
Not later than 11:00 a.m. on the date of any payment by the L/C Issuer
under a Letter of Credit (each such date, an "Honor Date"), the
Borrower shall reimburse the L/C Issuer through the Administrative
Agent in an amount equal to the amount of such drawing. If the Borrower
fails to so reimburse the L/C Issuer by such time, the Administrative
Agent shall promptly notify each Lender of the Honor Date, the amount
of the unreimbursed drawing (the "Unreimbursed Amount"), and the amount
of such Lender's Pro Rata Share thereof. In such event, the Borrower
shall be deemed to have requested a Borrowing of Base Rate Loans to be
disbursed on the Honor Date in an amount equal to the Unreimbursed
Amount, without regard to the minimum and multiples specified in
Section 2.02 for the principal amount of Base Rate Loans, but subject
to the amount of the unutilized portion of the Aggregate Revolving
Commitments and the conditions set forth in Section 5.02 (other than
the delivery of a Loan Notice). Any notice given by the L/C Issuer or
the Administrative Agent pursuant to this Section 2.03(c)(i) may be
given by telephone if immediately confirmed in writing; provided that
the lack of such an immediate confirmation shall not affect the
conclusiveness or binding effect of such notice.
(ii) Each Lender (including the Lender acting as L/C
Issuer) shall upon any notice pursuant to Section 2.03(c)(i) make funds
available to the Administrative Agent for the account of the L/C Issuer
at the Administrative Agent's Office in an amount equal to its Pro Rata
Share of the Unreimbursed Amount not later than 1:00 p.m. on the
Business Day specified in such notice by the Administrative Agent,
whereupon, subject to the provisions of Section 2.03(c)(iii), each
Lender that so makes funds available shall be deemed to have made a
Base Rate Loan to the Borrower in such amount. The Administrative Agent
shall remit the funds so received to the L/C Issuer.
(iii) With respect to any Unreimbursed Amount that is not
fully refinanced by a Borrowing of Base Rate Loans because the
conditions set forth in Section 5.02 cannot be satisfied or for any
other reason, the Borrower shall be deemed to have incurred from the
L/C Issuer an L/C Borrowing in the amount of the Unreimbursed Amount
that is not so refinanced, which L/C Borrowing shall be due and payable
on demand (together with interest) and shall bear interest at the
Default Rate. In such event, each Lender's payment to the
Administrative Agent for the account of the L/C Issuer pursuant to
Section 2.03(c)(ii) shall be deemed payment in respect of its
participation in such L/C Borrowing and shall constitute an L/C Advance
from such Lender in satisfaction of its participation obligation under
this Section 2.03.
(iv) Until each Lender funds its Revolving Loan or L/C
Advance pursuant to this Section 2.03(c) to reimburse the L/C Issuer
for any amount drawn under any Letter of Credit, interest in respect of
such Lender's Pro Rata Share of such amount shall be solely for the
account of the L/C Issuer.
(v) Each Lender's obligation to make Revolving Loans or
L/C Advances to reimburse the L/C Issuer for amounts drawn under
Letters of Credit, as contemplated by this
31
Section 2.03(c), shall be absolute and unconditional and shall not be
affected by any circumstance, including (A) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against
the L/C Issuer, the Borrower or any other Person for any reason
whatsoever; (B) the occurrence or continuance of a Default, or (C) any
other occurrence, event or condition, whether or not similar to any of
the foregoing; provided, however, that each Lender's obligation to make
Revolving Loans pursuant to this Section 2.03(c) is subject to the
conditions set forth in Section 5.02 (other than delivery by the
Borrower of a Loan Notice). No such making of an L/C Advance shall
relieve or otherwise impair the obligation of the Borrower to reimburse
the L/C Issuer for the amount of any payment made by the L/C Issuer
under any Letter of Credit, together with interest as provided herein.
(vi) If any Lender fails to make available to the
Administrative Agent for the account of the L/C Issuer any amount
required to be paid by such Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(ii),
the L/C Issuer shall be entitled to recover from such Lender (acting
through the Administrative Agent), on demand, such amount with interest
thereon for the period from the date such payment is required to the
date on which such payment is immediately available to the L/C Issuer
at a rate per annum equal to the Federal Funds Rate from time to time
in effect. A certificate of the L/C Issuer submitted to any Lender
(through the Administrative Agent) with respect to any amounts owing
under this clause (vi) shall be conclusive absent manifest error.
(d) Repayment of Participations.
(i) At any time after the L/C Issuer has made a payment
under any Letter of Credit and has received from any Lender such
Lender's L/C Advance in respect of such payment in accordance with
Section 2.03(c), if the Administrative Agent receives for the account
of the L/C Issuer any payment in respect of the related Unreimbursed
Amount or interest thereon (whether directly from the Borrower or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such
Lender its Pro Rata Share thereof (appropriately adjusted, in the case
of interest payments, to reflect the period of time during which such
Lender's L/C Advance was outstanding) in the same funds as those
received by the Administrative Agent.
(ii) If any payment received by the Administrative Agent
for the account of the L/C Issuer pursuant to Section 2.03(c)(i) is
required to be returned under any of the circumstances described in
Section 11.06 (including pursuant to any settlement entered into by the
L/C Issuer in its discretion), each Lender shall pay to the
Administrative Agent for the account of the L/C Issuer its Pro Rata
Share thereof on demand of the Administrative Agent, plus interest
thereon from the date of such demand to the date such amount is
returned by such Lender, at a rate per annum equal to the Federal Funds
Rate from time to time in effect.
(e) Obligations Absolute. The obligation of the Borrower to
reimburse the L/C Issuer for each drawing under each Letter of Credit and to
repay each L/C Borrowing shall be absolute, unconditional and irrevocable, and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i) any lack of validity or enforceability of such Letter
of Credit, this Agreement, any other Loan Document or any other
agreement or instrument relating thereto;
(ii) the existence of any claim, counterclaim, set-off,
defense or other right that the Borrower may have at any time against
any beneficiary or any transferee of such Letter of Credit
32
(or any Person for whom any such beneficiary or any such transferee may
be acting), the L/C Issuer or any other Person, whether in connection
with this Agreement, the transactions contemplated hereby or by such
Letter of Credit or any agreement or instrument relating thereto, or
any unrelated transaction;
(iii) any draft, demand, certificate or other document
presented under such Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under such Letter of Credit;
(iv) any payment by the L/C Issuer under such Letter of
Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment
made by the L/C Issuer under such Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession,
assignee for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of
such Letter of Credit, including any arising in connection with any
proceeding under any Debtor Relief Law; or
(v) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or
a discharge of, the Borrower.
The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim of
noncompliance with the Borrower's instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer. The Borrower shall be
conclusively deemed to have waived any such claim against the L/C Issuer and its
correspondents unless such notice is given as aforesaid.
(f) Role of L/C Issuer. Each Lender and the Borrower agree that,
in paying any drawing under a Letter of Credit, the L/C Issuer shall not have
any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by such Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document. None of the
L/C Issuer, any Agent-Related Person or any of the respective correspondents,
participants or assignees of the L/C Issuer shall be liable to any Lender for
(i) any action taken or omitted in connection herewith at the request or with
the approval of the Lenders or the Required Lenders, as applicable; (ii) any
action taken or omitted in the absence of gross negligence or willful
misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any document or instrument related to any Letter of Credit or
Letter of Credit Application. The Borrower hereby assumes all risks of the acts
or omissions of any beneficiary or transferee with respect to its use of any
Letter of Credit; provided, however, that this assumption is not intended to,
and shall not, preclude the Borrower's pursuing such rights and remedies as it
may have against the beneficiary or transferee at law or under any other
agreement. None of the L/C Issuer, any Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the L/C Issuer, shall be
liable or responsible for any of the matters described in clauses (i) through
(v) of Section 2.03(e); provided, however, that anything in such clauses to the
contrary notwithstanding, the Borrower may have a claim against the L/C Issuer,
and the L/C Issuer may be liable to the Borrower, to the extent, but only to the
extent, of any direct, as opposed to consequential or exemplary, damages
suffered by the Borrower which the Borrower proves were caused by the L/C
Issuer's willful misconduct or gross negligence or the L/C Issuer's willful
failure to pay under any Letter of Credit after the presentation to it by the
beneficiary of a sight draft and certificate(s) strictly complying with the
terms and conditions of a Letter of Credit. In furtherance and not in limitation
of the foregoing, the L/C Issuer may accept documents that appear on their face
to be in
33
order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may prove
to be invalid or ineffective for any reason.
(g) Cash Collateral. Upon the request of the Administrative Agent,
(i) if the L/C Issuer has honored any full or partial drawing request under any
Letter of Credit and such drawing has resulted in an L/C Borrowing, or (ii) if,
as of the Letter of Credit Expiration Date, any Letter of Credit may for any
reason remain outstanding and partially or wholly undrawn, the Borrower shall
immediately Cash Collateralize the then Outstanding Amount of all L/C
Obligations (in an amount equal to such Outstanding Amount determined as of the
date of such L/C Borrowing or the Letter of Credit Expiration Date, as the case
may be). For purposes hereof, "Cash Collateralize" means to pledge and deposit
with or deliver to the Administrative Agent, for the benefit of the L/C Issuer
and the Lenders, as collateral for the L/C Obligations, cash or deposit account
balances pursuant to documentation in form and substance satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented to
by the Lenders). Derivatives of such term have corresponding meanings. The
Borrower hereby grants to the Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing. Cash collateral
shall be maintained in blocked, non-interest bearing deposit accounts at Bank of
America.
(h) Applicability of ISP98. Unless otherwise expressly agreed by
the L/C Issuer and the Borrower when a Letter of Credit is issued, the rules of
the "International Standby Practices 1998" published by the Institute of
International Banking Law & Practice (or such later version thereof as may be in
effect at the time of issuance) shall apply to each standby Letter of Credit.
(i) Letter of Credit Fees. The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with its Pro
Rata Share a Letter of Credit fee for each Letter of Credit equal to the
Applicable Rate times the daily maximum amount available to be drawn under such
Letter of Credit (whether or not such maximum amount is then in effect under
such Letter of Credit). Such Letter of Credit fees shall be computed on a
quarterly basis in arrears. Such Letter of Credit fees shall be due and payable
on the first Business Day after the end of each March, June, September and
December, commencing with the first such date to occur after the issuance of
such Letter of Credit, on the Letter of Credit Expiration Date and thereafter on
demand. If there is any change in the Applicable Rate during any quarter, the
daily maximum amount of each Letter of Credit shall be computed and multiplied
by the Applicable Rate separately for each period during such quarter that such
Applicable Rate was in effect.
(j) Documentary and Processing Charges Payable to L/C Issuer. The
Borrower shall pay directly to the L/C Issuer for its own account a fronting fee
with respect to each Letter of Credit in the amounts and at the times specified
in the Fee Letter. In addition, the Borrower shall pay directly to the L/C
Issuer for its own account the customary issuance, presentation, amendment and
other processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect. Such customary
fees and standard costs and charges are due and payable on demand and are
nonrefundable.
(k) Conflict with Letter of Credit Application. In the event of
any conflict between the terms hereof and the terms of any Letter of Credit
Application, the terms hereof shall control.
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2.04 SWING LINE LOANS.
(a) The Swing Line. Subject to the terms and conditions set forth
herein, the Swing Line Lender agrees to make loans (each such loan, a "Swing
Line Loan") to the Borrower in Dollars from time to time on any Business Day
during the Availability Period in an aggregate amount not to exceed at any time
outstanding the amount of the Swing Line Sublimit, notwithstanding the fact that
such Swing Line Loans, when aggregated with the Pro Rata Share of the
Outstanding Amount of Revolving Loans and L/C Obligations of the Swing Line
Lender in its capacity as a Lender of Revolving Loans, may exceed the amount of
such Lender's Revolving Commitment; provided, however, that after giving effect
to any Borrowing of Swing Line Loans, (i) the Total Revolving Outstandings shall
not exceed the lesser of (A) the Aggregate Revolving Commitments and (B) the
Borrowing Base, and (ii) the aggregate Outstanding Amount of the Revolving Loans
of any Lender, plus such Lender's Pro Rata Share of the Outstanding Amount of
all L/C Obligations, plus such Lender's Pro Rata Share of the Outstanding Amount
of all Swing Line Loans shall not exceed the lesser of (A) such Lender's
Revolving Commitment and (B) an amount equal to such Lender's Revolving
Commitment Percentage of the Borrowing Base, and provided, further, that the
Borrower shall not use the proceeds of any Swing Line Loan to refinance any
outstanding Swing Line Loan. Within the foregoing limits, and subject to the
other terms and conditions hereof, the Borrower may borrow under this Section
2.04, prepay under Section 2.05, and reborrow under this Section 2.04. Each
Swing Line Loan shall be a Base Rate Loan. Immediately upon the making of a
Swing Line Loan, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the Swing Line Lender a risk
participation in such Swing Line Loan in an amount equal to the product of such
Lender's Pro Rata Share times the amount of such Swing Line Loan.
(b) Borrowing Procedures. Each Borrowing of Swing Line Loans shall
be made upon the Borrower's irrevocable notice to the Swing Line Lender and the
Administrative Agent, which may be given by telephone. Each such notice must be
received by the Swing Line Lender and the Administrative Agent not later than
1:00 p.m. on the requested borrowing date, and shall specify (i) the amount to
be borrowed, which shall be a minimum principal amount of $100,000, or a whole
multiple of $100,000 in excess thereof, and (ii) the requested borrowing date,
which shall be a Business Day. Each such telephonic notice must be confirmed
promptly by delivery to the Swing Line Lender and the Administrative Agent of a
written Swing Line Loan Notice, appropriately completed and signed by a
Responsible Officer of the Borrower. Promptly after receipt by the Swing Line
Lender of any telephonic Swing Line Loan Notice, the Swing Line Lender will
confirm with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has also received such Swing Line Loan Notice and, if not,
the Swing Line Lender will notify the Administrative Agent (by telephone or in
writing) of the contents thereof. Unless the Swing Line Lender has received
notice (by telephone or in writing) from the Administrative Agent (including at
the request of any Lender) prior to 2:00 p.m. on the date of the proposed
Borrowing of Swing Line Loans (A) directing the Swing Line Lender not to make
such Swing Line Loan as a result of the limitations set forth in the proviso to
the first sentence of Section 2.04(a), or (B) that one or more of the applicable
conditions specified in Article V is not then satisfied, then, subject to the
terms and conditions hereof, the Swing Line Lender will, not later than 3:00
p.m. on the borrowing date specified in such Swing Line Loan Notice, make the
amount of its Swing Line Loan available to the Borrower.
(c) Refinancing of Swing Line Loans.
(i) The Swing Line Lender at any time in its sole and
absolute discretion may request, on behalf of the Borrower (which
hereby irrevocably requests and authorizes the Swing Line Lender to so
request on its behalf), that each Lender make a Base Rate Loan in an
amount equal to such Lender's Pro Rata Share of the amount of Swing
Line Loans then outstanding. Such request shall be made in writing
(which written request shall be deemed to be a Loan Notice
35
for purposes hereof) and in accordance with the requirements of Section
2.02, without regard to the minimum and multiples specified therein for
the principal amount of Base Rate Loans, but subject to the unutilized
portion of the Aggregate Revolving Commitments and the conditions set
forth in Section 5.02. The Swing Line Lender shall furnish the Borrower
with a copy of the applicable Loan Notice promptly after delivering
such notice to the Administrative Agent. Each Lender shall make an
amount equal to its Pro Rata Share of the amount specified in such Loan
Notice available to the Administrative Agent in immediately available
funds for the account of the Swing Line Lender at the Administrative
Agent's Office not later than 1:00 p.m. on the day specified in such
Loan Notice, whereupon, subject to Section 2.04(c)(ii), each Lender
that so makes funds available shall be deemed to have made a Base Rate
Loan to the Borrower in such amount. The Administrative Agent shall
remit the funds so received to the Swing Line Lender.
(ii) If for any reason any Swing Line Loan cannot be
refinanced by such a Borrowing of Revolving Loans in accordance with
Section 2.04(c)(i), the request for Base Rate Loans submitted by the
Swing Line Lender as set forth herein shall be deemed to be a request
by the Swing Line Lender that each of the Lenders fund its risk
participation in the relevant Swing Line Loan and each Lender's payment
to the Administrative Agent for the account of the Swing Line Lender
pursuant to Section 2.04(c)(i) shall be deemed payment in respect of
such participation.
(iii) If any Lender fails to make available to the
Administrative Agent for the account of the Swing Line Lender any
amount required to be paid by such Lender pursuant to the foregoing
provisions of this Section 2.04(c) by the time specified in Section
2.04(c)(i), the Swing Line Lender shall be entitled to recover from
such Lender (acting through the Administrative Agent), on demand, such
amount with interest thereon for the period from the date such payment
is required to the date on which such payment is immediately available
to the Swing Line Lender at a rate per annum equal to the Federal Funds
Rate from time to time in effect. A certificate of the Swing Line
Lender submitted to any Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (iii) shall be
conclusive absent manifest error.
(iv) Each Lender's obligation to make Revolving Loans or
to purchase and fund risk participations in Swing Line Loans pursuant
to this Section 2.04(c) shall be absolute and unconditional and shall
not be affected by any circumstance, including (A) any set-off,
counterclaim, recoupment, defense or other right that such Lender may
have against the Swing Line Lender, the Borrower or any other Person
for any reason whatsoever, (B) the occurrence or continuance of a
Default, or (C) any other occurrence, event or condition, whether or
not similar to any of the foregoing; provided, however, that each
Lender's obligation to make Revolving Loans pursuant to this Section
2.04(c) is subject to the conditions set forth in Section 5.02. No such
purchase or funding of risk participations shall relieve or otherwise
impair the obligation of the Borrower to repay Swing Line Loans,
together with interest as provided herein.
(d) Repayment of Participations.
(i) At any time after any Lender has purchased and funded
a risk participation in a Swing Line Loan, if the Swing Line Lender
receives any payment on account of such Swing Line Loan, the Swing Line
Lender will distribute to such Lender its Pro Rata Share of such
payment (appropriately adjusted, in the case of interest payments, to
reflect the period of time during which such Lender's risk
participation was funded) in the same funds as those received by the
Swing Line Lender.
(ii) If any payment received by the Swing Line Lender in
respect of principal or interest on any Swing Line Loan is required to
be returned by the Swing Line Lender under any
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of the circumstances described in Section 11.06 (including pursuant to
any settlement entered into by the Swing Line Lender in its
discretion), each Lender shall pay to the Swing Line Lender its Pro
Rata Share thereof on demand of the Administrative Agent, plus interest
thereon from the date of such demand to the date such amount is
returned, at a rate per annum equal to the Federal Funds Rate. The
Administrative Agent will make such demand upon the request of the
Swing Line Lender.
(e) Interest for Account of Swing Line Lender. The Swing Line
Lender shall be responsible for invoicing the Borrower for interest on the Swing
Line Loans. Until each Lender funds its Revolving Loans that are Base Rate Loans
or risk participation pursuant to this Section 2.04 to refinance such Lender's
Pro Rata Share of any Swing Line Loan, interest in respect of such Pro Rata
Share shall be solely for the account of the Swing Line Lender.
(f) Payments Directly to Swing Line Lender. The Borrower shall
make all payments of principal and interest in respect of the Swing Line Loans
directly to the Swing Line Lender.
2.05 PREPAYMENTS.
(a) Voluntary Prepayments of Loans.
(i) Revolving Loans. The Borrower may, upon notice from
the Borrower to the Administrative Agent, at any time or from time to
time voluntarily prepay Revolving Loans in whole or in part without
premium or penalty; provided that (i) such notice must be received by
the Administrative Agent not later than 11:00 a.m. (A) three Business
Days prior to any date of prepayment of Eurodollar Rate Loans, and (B)
on the date of prepayment of Base Rate Loans; (ii) any such prepayment
of Eurodollar Rate Loans shall be in a principal amount of $1,000,000
or a whole multiple of $100,000 in excess thereof (or, if less, the
entire principal amount thereof then outstanding); (iii) any such
prepayment of Base Rate Loans shall be in a principal amount of
$500,000 or a whole multiple of $100,000 in excess thereof (or, if
less, the entire principal amount thereof then outstanding). Each such
notice shall specify the date and amount of such prepayment and the
Type(s) of Loans to be prepaid. The Administrative Agent will promptly
notify each Lender of its receipt of each such notice, and of the
amount of such Lender's Pro Rata Share of such prepayment. If such
notice is given by the Borrower, the Borrower shall make such
prepayment and the payment amount specified in such notice shall be due
and payable on the date specified therein. Any prepayment of a
Eurodollar Rate Loan shall be accompanied by all accrued interest
thereon, together with any additional amounts required pursuant to
Section 3.05. Each such prepayment shall be applied to the Loans of the
Lenders in accordance with their respective Pro Rata Shares.
(ii) Swing Line Loans. The Borrower may, upon notice to
the Swing Line Lender (with a copy to the Administrative Agent), at any
time or from time to time, voluntarily prepay Swing Line Loans in whole
or in part without premium or penalty; provided that (i) such notice
must be received by the Swing Line Lender and the Administrative Agent
not later than 1:00 p.m. on the date of the prepayment, and (ii) any
such prepayment shall be in a minimum principal amount of $100,000 or a
whole multiple of $100,000 in excess thereof (or, if less, the entire
principal amount thereof then outstanding). Each such notice shall
specify the date and amount of such prepayment. If such notice is given
by the Borrower, the Borrower shall make such prepayment and the
payment amount specified in such notice shall be due and payable on the
date specified therein.
(b) Mandatory Prepayments of Loans.
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(i) Total Revolving Outstandings. If for any reason the
Total Revolving Outstandings at any time exceed the lesser of the
Aggregate Revolving Commitments and the Borrowing Base, the Borrower
shall immediately prepay Revolving Loans and/or the Swing Line Loans in
an aggregate amount equal to such excess.
(ii) Dispositions and Involuntary Dispositions. The
Borrower shall prepay the Loans as hereafter provided in an aggregate
amount equal to 100% of the Net Cash Proceeds of any Disposition or
Involuntary Disposition (each such prepayment to be applied as set
forth in clause (v) below) to the extent (A) such Net Cash Proceeds are
not reinvested in Property useful in the business of the Borrower and
its Subsidiaries within nine (9) months of the date of such Disposition
or Involuntary Disposition, and (B) the aggregate amount of Net Cash
Proceeds of all Dispositions and Involuntary Dispositions not
reinvested in accordance with the foregoing clause (A) shall exceed
$2,000,000 in any fiscal year of the Borrower.
(iii) Debt Issuances. Immediately upon receipt by the
Borrower or any Subsidiary of the Net Cash Proceeds of any Debt
Issuance, the Borrower shall prepay the Loans as hereafter provided in
an aggregate amount equal to 100% of such Net Cash Proceeds (such
prepayment to be applied as set forth in clause (v) below).
(iv) Equity Issuances. Immediately upon receipt by the
Borrower or any Subsidiary of the Net Cash Proceeds of any Equity
Issuance, the Borrower shall prepay the Loans as hereafter provided in
an aggregate amount equal to 100% of such Net Cash Proceeds (such
prepayment to be applied as set forth in clause (v) below).
(v) Application of Mandatory Prepayments. All amounts
required to be paid pursuant to this Section 2.05(b) shall be applied
first to Swing Line Loans and then (after all Swing Line Loans have
been repaid) to Revolving Loans. Within the parameters of the
applications set forth above, prepayments shall be applied first to
Base Rate Loans and then to Eurodollar Rate Loans in direct order of
Interest Period maturities. All prepayments under this Section 2.05(b)
shall be subject to Section 3.05, but otherwise without premium or
penalty, and shall be accompanied by interest on the principal amount
prepaid through the date of prepayment.
2.06 TERMINATION OR REDUCTION OF AGGREGATE REVOLVING COMMITMENTS.
The Borrower may, upon notice from the Borrower to the Administrative
Agent, terminate the Aggregate Revolving Commitments or from time to time
permanently reduce the Aggregate Revolving Commitments to an amount not less
than the Outstanding Amount of Revolving Loans, Swing Line Loans and L/C
Obligations; provided that (i) any such notice shall be received by the
Administrative Agent not later than 11:00 a.m. five Business Days prior to the
date of termination or reduction and (ii) any such partial reduction shall be in
an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof. The Administrative Agent will promptly notify the Lenders of any such
notice of termination or reduction of the Aggregate Revolving Commitments. Any
reduction of the Aggregate Revolving Commitments shall be applied to the
Revolving Commitment of each Lender according to its Pro Rata Share. All
commitment fees and utilization fees accrued until the effective date of any
termination of the Aggregate Revolving Commitments shall be paid on the
effective date of such termination.
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2.07 REPAYMENT OF LOANS.
(a) The Borrower shall repay to the Lenders on the Maturity Date
the aggregate principal amount of all Revolving Loans outstanding on such date.
(b) The Borrower shall repay each Swing Line Loan on the earlier
to occur of (i) demand by the Swing Line Lender and (ii) the Maturity Date.
2.08 INTEREST.
(a) Subject to the provisions of subsection (b) below, (i) each
Revolving Loan that is a Eurodollar Rate Loan shall bear interest on the
outstanding principal amount thereof for each Interest Period at a rate per
annum equal to the sum of (A) the Eurodollar Rate for such Interest Period plus
(B) the Applicable Rate; (ii) each Revolving Loan that is a Base Rate Loan bear
interest on the outstanding principal amount thereof from the applicable
borrowing or conversion date at a rate per annum equal to the Base Rate plus the
Applicable Rate; and (iii) each Swing Line Loan shall bear interest on the
outstanding principal amount thereof from the applicable borrowing date at a
rate per annum equal to the Base Rate plus the Applicable Rate.
(b) Upon the occurrence and during the continuation of an Event of
Default, the Borrower shall pay interest on the principal amount of all
outstanding Obligations at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.
(c) Interest on each Loan shall be due and payable in arrears on
each Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
2.09 FEES.
In addition to certain fees described in subsections (i) and (j) of
Section 2.03:
(a) Commitment Fee. The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with
its Pro Rata Share, a commitment fee equal to the product of (i) the
Applicable Rate times (ii) the actual daily amount by which the
Aggregate Revolving Commitments exceed the sum of (y) the Outstanding
Amount of Revolving Loans and (z) the Outstanding Amount of L/C
Obligations. The commitment fee shall accrue at all times during the
Availability Period, including at any time during which one or more of
the conditions in Article V is not met, and shall be due and payable
quarterly in arrears on the last Business Day of each March, June,
September and December, commencing with the first such date to occur
after the Closing Date, and on the Maturity Date. The commitment fee
shall be calculated quarterly in arrears, and if there is any change in
the Applicable Rate during any quarter, the actual daily amount shall
be computed and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in effect. For
purposes of clarification, Swing Line Loans shall not be considered
outstanding for purposes of determining the unused portion of the
Aggregate Revolving Commitments.
(b) Utilization Fee. The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with
its Pro Rata Share, a utilization fee of (i) 0.25% per annum times (ii)
the actual daily amount by which the Aggregate Revolving Commitments
exceed the sum of (y) the Outstanding Amount of Revolving Loans and (z)
the Outstanding
39
Amount of L/C Obligations, on each day that the Total Outstandings are
less than 33% of the actual daily amount of the Aggregate Revolving
Commitments. The utilization fee shall accrue at all times during the
Availability Period, including at any time during which one or more of
the conditions in Article V is not met, and shall be due and payable
quarterly in arrears on the last Business Day of each March, June,
September and December, commencing with the first such date to occur
after the Closing Date, and on the Maturity Date. The utilization fee
shall be calculated quarterly in arrears. For purposes of
clarification, Swing Line Loans shall be considered outstanding for
purposes of determining the utilization fee.
(c) Other Fees.
(i) The Borrower shall pay to the Arranger and
the Administrative Agent for their own respective accounts
fees in the amounts and at the times specified in the Fee
Letter. Such fees shall be fully earned when paid and shall be
non-refundable for any reason whatsoever.
(ii) The Borrower shall pay to the Lenders such
fees as shall have been separately agreed upon in writing in
the amounts and at the times so specified. Such fees shall be
fully earned when paid and shall not be refundable for any
reason whatsoever.
2.10 COMPUTATION OF INTEREST AND FEES.
All computations of interest for Base Rate Loans when the Base Rate is
determined by Bank of America's "prime rate" shall be made on the basis of a
year of 365 or 366 days, as the case may be, and actual days elapsed. All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more fees or interest, as applicable,
being paid than if computed on the basis of a 365-day year). Interest shall
accrue on each Loan for the day on which the Loan is made, and shall not accrue
on a Loan, or any portion thereof, for the day on which the Loan or such portion
is paid, provided that any Loan that is repaid on the same day on which it is
made shall, subject to Section 2.12(a), bear interest for one day.
2.11 EVIDENCE OF DEBT.
(a) The Credit Extensions made by each Lender shall be evidenced
by one or more accounts or records maintained by such Lender and by the
Administrative Agent in the ordinary course of business. The accounts or records
maintained by the Administrative Agent and each Lender shall be conclusive
absent manifest error of the amount of the Credit Extensions made by the Lenders
to the Borrower and the interest and payments thereon. Any failure to so record
or any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect to the
Obligations. In the event of any conflict between the accounts and records
maintained by any Lender and the accounts and records of the Administrative
Agent in respect of such matters, the accounts and records of the Administrative
Agent shall control in the absence of manifest error. Upon the request of any
Lender made through the Administrative Agent, the Borrower shall execute and
deliver to such Lender (through the Administrative Agent) a promissory note,
which shall evidence such Lender's Loans in addition to such accounts or
records. Each such promissory note shall (i) in the case of Revolving Loans, be
in the form of Exhibit C-1 (a "Revolving Note"), and (ii) in the case of Swing
Line Loans, be in the form of Exhibit C-2 (a "Swing Line Note"). Each Lender may
attach schedules to its Note and endorse thereon the date, Type (if applicable),
amount and maturity of its Loans and payments with respect thereto.
40
(b) In addition to the accounts and records referred to in
subsection (a), each Lender and the Administrative Agent shall maintain in
accordance with its usual practice accounts or records evidencing the purchases
and sales by such Lender of participations in Letters of Credit and Swing Line
Loans. In the event of any conflict between the accounts and records maintained
by the Administrative Agent and the accounts and records of any Lender in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error.
2.12 PAYMENTS GENERALLY.
(a) All payments to be made by the Borrower shall be made without
condition or deduction for any counterclaim, defense, recoupment or setoff.
Except as otherwise expressly provided herein, all payments by the Borrower
hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the Administrative Agent's
Office in Dollars and in immediately available funds not later than 2:00 p.m. on
the date specified herein. The Administrative Agent will promptly distribute to
each Lender its Pro Rata Share (or other applicable share as provided herein) of
such payment in like funds as received by wire transfer to such Lender's Lending
Office. All payments received by the Administrative Agent after 2:00 p.m. shall
be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue.
(b) Subject to the definition of "Interest Period", if any payment
to be made by the Borrower shall come due on a day other than a Business Day,
payment shall be made on the next following Business Day, and such extension of
time shall be reflected in computing interest or fees, as the case may be.
(c) If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal, L/C
Borrowings, interest and fees then due hereunder, such funds shall be applied
(i) first, toward costs and expenses (including Attorney Costs and amounts
payable under Article III) incurred by the Administrative Agent, (ii) second,
toward costs and expenses (including Attorney Costs and amounts payable under
Article III) incurred by the Lenders, ratably among the parties entitled thereto
in accordance with the amounts of costs and expenses then due to such parties,
(iii) third, toward repayment of interest and fees then due hereunder, ratably
among the parties entitled thereto in accordance with the amounts of interest
and fees then due to such parties, and (iv) fourth, toward repayment of
principal and L/C Borrowings then due hereunder, ratably among the parties
entitled thereto in accordance with the amounts of principal and L/C Borrowings
then due to such parties.
(d) Unless the Borrower or any Lender has notified the
Administrative Agent, prior to the date any payment is required to be made by it
to the Administrative Agent hereunder, that the Borrower or such Lender, as the
case may be, will not make such payment, the Administrative Agent may assume
that the Borrower or such Lender, as the case may be, has timely made such
payment and may (but shall not be so required to), in reliance thereon, make
available a corresponding amount to the Person entitled thereto. If and to the
extent that such payment was not in fact made to the Administrative Agent in
immediately available funds, then:
(i) if the Borrower failed to make such payment, each
Lender shall forthwith on demand repay to the Administrative Agent the
portion of such assumed payment that was made available to such Lender
in immediately available funds, together with interest thereon in
respect of each day from and including the date such amount was made
available by the Administrative Agent to such Lender to the date such
amount is repaid to the Administrative Agent in immediately available
funds at the Federal Funds Rate from time to time in effect; and
41
(ii) if any Lender failed to make such payment, such
Lender shall forthwith on demand pay to the Administrative Agent the
amount thereof in immediately available funds, together with interest
thereon for the period from the date such amount was made available by
the Administrative Agent to the Borrower to the date such amount is
recovered by the Administrative Agent (the "Compensation Period") at a
rate per annum equal to the Federal Funds Rate from time to time in
effect. If such Lender pays such amount to the Administrative Agent,
then such amount shall constitute such Lender's Loan included in the
applicable Borrowing. If such Lender does not pay such amount forthwith
upon the Administrative Agent's demand therefor, the Administrative
Agent may make a demand therefor upon the Borrower, and the Borrower
shall pay such amount to the Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal
to the rate of interest applicable to the applicable Borrowing. Nothing
herein shall be deemed to relieve any Lender from its obligation to
fulfill its Revolving Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a
result of any default by such Lender hereunder.
A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (d) shall be conclusive,
absent manifest error.
(e) If any Lender makes available to the Administrative Agent
funds for any Loan to be made by such Lender as provided in the foregoing
provisions of this Article II, and such funds are not made available to the
Borrower by the Administrative Agent because the conditions to the applicable
Credit Extension set forth in Article V are not satisfied or waived in
accordance with the terms hereof, the Administrative Agent shall return such
funds (in like funds as received from such Lender) to such Lender, without
interest.
(f) The obligations of the Lenders hereunder to make Loans and to
fund participations in Letters of Credit and Swing Line Loans are several and
not joint. The failure of any Lender to make any Loan or to fund any such
participation on any date required hereunder shall not relieve any other Lender
of its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or purchase
its participation.
(g) Nothing herein shall be deemed to obligate any Lender to
obtain the funds for any Loan in any particular place or manner or to constitute
a representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
2.13 SHARING OF PAYMENTS.
If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Loans made by it, or the participations in L/C
Obligations or in Swing Line Loans held by it (but not including any amounts
applied by the Swing Line Lender to outstanding Swing Line Loans), any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify the Administrative
Agent of such fact, and (b) purchase from the other Lenders such participations
in the Loans made by them and/or such subparticipations in the participations in
L/C Obligations or Swing Line Loans held by them, as the case may be, as shall
be necessary to cause such purchasing Lender to share the excess payment in
respect of such Loans or such participations, as the case may be, pro rata with
each of them; provided, however, that if all or any portion of such excess
payment is thereafter recovered from the purchasing Lender under any of the
circumstances described in Section 11.06 (including pursuant to any settlement
entered into by the purchasing Lender in its discretion), such purchase shall to
that extent be rescinded and each other Lender shall repay to the purchasing
Lender the purchase price paid therefor, together with an amount equal to such
paying Lender's ratable share (according to the proportion of (i) the
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amount of such paying Lender's required repayment to (ii) the total amount so
recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered,
without further interest thereon. The Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
set-off, but subject to Section 11.09) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation. The Administrative Agent will keep records (which shall
be conclusive and binding in the absence of manifest error) of participations
purchased under this Section and will in each case notify the Lenders following
any such purchases or repayments. Each Lender that purchases a participation
pursuant to this Section shall from and after such purchase have the right to
give all notices, requests, demands, directions and other communications under
this Agreement with respect to the portion of the Obligations purchased to the
same extent as though the purchasing Lender were the original owner of the
Obligations purchased.
ARTICLE III
TAXES, YIELD PROTECTION AND ILLEGALITY
3.01 TAXES.
(a) Subject to Section 11.15, any and all payments by any Loan
Party to or for the account of the Administrative Agent or any Lender under any
Loan Document shall be made free and clear of and without deduction for any and
all present or future taxes, duties, levies, imposts, deductions, assessments,
fees, withholdings or similar charges, and all liabilities with respect thereto,
excluding, in the case of the Administrative Agent and each Lender, taxes
imposed on or measured by its overall net income, and franchise taxes imposed on
it (in lieu of net income taxes), by the jurisdiction (or any political
subdivision thereof) under the Laws of which the Administrative Agent or such
Lender, as the case may be, is organized or maintains a lending office (all such
non-excluded taxes, duties, levies, imposts, deductions, assessments, fees,
withholdings or similar charges, and liabilities being hereinafter referred to
as "Taxes"). If any Loan Party shall be required by any Laws to deduct any Taxes
from or in respect of any sum payable under any Loan Document to the
Administrative Agent or any Lender, (i) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section), each of the
Administrative Agent and such Lender receives an amount equal to the sum it
would have received had no such deductions been made, (ii) such Loan Party shall
make such deductions, (iii) such Loan Party shall pay the full amount deducted
to the relevant taxation authority or other authority in accordance with
applicable Laws, and (iv) within thirty days after the date of such payment,
such Loan Party shall furnish to the Administrative Agent (which shall forward
the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof or if no receipt is available, other evidence of
payment reasonably satisfactory to the Administrative Agent.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp, court or documentary taxes and any other excise or property taxes
or charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If the Borrower shall be required to deduct or pay any Taxes
or Other Taxes from or in respect of any sum payable under any Loan Document to
the Administrative Agent or any Lender, the Borrower shall also pay to the
Administrative Agent or to such Lender, as the case may be, at the time
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interest is paid, such additional amount that the Administrative Agent or such
Lender specifies is necessary to preserve the after-tax yield (after factoring
in all taxes, including taxes imposed on or measured by net income) that the
Administrative Agent or such Lender would have received if such Taxes or Other
Taxes had not been deducted or paid.
(d) The Borrower agrees to indemnify the Administrative Agent and
each Lender for (i) the full amount of Taxes and Other Taxes (including any
Taxes or Other Taxes imposed or asserted by any jurisdiction on amounts payable
under this Section) paid by the Administrative Agent and such Lender, (ii)
amounts payable under Section 3.01(c) and (iii) any liability (including
additions to tax, penalties, interest and expenses) arising therefrom or with
respect thereto, in each case whether or not such Taxes or Other Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
Payment under this subsection (d) shall be made within thirty days after the
date the Lender or the Administrative Agent makes a demand therefor.
(e) If any Loan Party is required to pay any amount to any Lender
or the Administrative Agent pursuant to this Section 3.01, then such Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office so as to eliminate any such
additional payment which may thereafter accrue, if such change in the reasonable
judgment of such Lender is not otherwise disadvantageous to such Lender.
3.02 ILLEGALITY.
If any Lender determines that any Law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for any Lender or its
applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or to
determine or charge interest rates based upon the Eurodollar Rate, then, on
notice thereof by such Lender to the Borrower through the Administrative Agent,
any obligation of such Lender to make or continue Eurodollar Rate Loans or to
convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until such
Lender notifies the Administrative Agent and the Borrower that the circumstances
giving rise to such determination no longer exist. Upon receipt of such notice,
the Borrower shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate
Loans of such Lender to Base Rate Loans, either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurodollar Rate Loans. Upon any such
prepayment or conversion, the Borrower shall also pay accrued interest on the
amount so prepaid or converted. Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.
3.03 INABILITY TO DETERMINE RATES.
If the Administrative Agent determines that for any reason adequate and
reasonable means do not exist for determining the Eurodollar Base Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan, or
that the Eurodollar Base Rate for any requested Interest Period with respect to
a proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost
to the Lenders of funding such Loan, the Administrative Agent will promptly
notify the Borrower and all Lenders. Thereafter, the obligation of the Lenders
to make or maintain Eurodollar Rate Loans shall be suspended until the
Administrative Agent revokes such notice. Upon receipt of such notice, the
Borrower may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Borrowing of Base Rate Loans in the
amount specified therein.
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3.04 INCREASED COST AND REDUCED RETURN; CAPITAL ADEQUACY.
(a) If any Lender determines that as a result of the introduction
of or any change in or in the interpretation of any Law, or such Lender's
compliance therewith, there shall be any increase in the cost to such Lender of
agreeing to make or making, funding or maintaining Eurodollar Rate Loans or (as
the case may be) issuing or participating in Letters of Credit, or a reduction
in the amount received or receivable by such Lender in connection with any of
the foregoing (excluding for purposes of this subsection (a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements utilized, as to Eurodollar Rate Loans, in the determination of the
Eurodollar Rate), then from time to time upon demand of such Lender (with a copy
of such demand to the Administrative Agent), the Borrower shall pay to such
Lender such additional amounts as will compensate such Lender for such increased
cost or reduction.
(b) If any Lender determines that the introduction of any Law
regarding capital adequacy or any change therein or in the interpretation
thereof, or compliance by such Lender (or its Lending Office) therewith, has the
effect of reducing the rate of return on the capital of such Lender or any
corporation controlling such Lender as a consequence of such Lender's
obligations hereunder (taking into consideration its policies with respect to
capital adequacy and such Lender's desired return on capital), then from time to
time upon demand of such Lender (with a copy of such demand to the
Administrative Agent), the Borrower shall pay to such Lender such additional
amounts as will compensate such Lender for such reduction.
3.05 FUNDING LOSSES.
Upon demand of any Lender (with a copy to the Administrative Agent)
from time to time, the Borrower shall promptly compensate such Lender for and
hold such Lender harmless from any loss, cost or expense incurred by it as a
result of:
(a) any continuation, conversion, payment or prepayment
of any Loan other than a Base Rate Loan on a day other than the last
day of the Interest Period for such Loan (whether voluntary, mandatory,
automatic, by reason of acceleration, or otherwise);
(b) any failure by the Borrower (for a reason other than
the failure of such Lender to make a Loan) to prepay, borrow, continue
or convert any Loan other than a Base Rate Loan on the date or in the
amount notified by the Borrower; or
(c) any assignment of a Eurodollar Rate Loan on a day
other than the last day of the Interest Period therefor as a result of
(i) a request by the Borrower pursuant to Section 11.16 or (ii) an
assignment by Bank of America pursuant to Section 11.07(b) as part of
the primary syndication of the Commitments and Loans during the 180-day
period immediately following the Closing Date;
including any loss of anticipated profits and any loss or expense
arising from the liquidation or reemployment of funds obtained by it to
maintain such Loan or from fees payable to terminate the deposits from
which such funds were obtained. The Borrower shall also pay any
customary administrative fees charged by such Lender in connection with
the foregoing.
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For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to have funded each
Eurodollar Rate Loan made by it at the Eurodollar Base Rate used in determining
the Eurodollar Rate for such Loan by a matching deposit or other borrowing in
the London interbank eurodollar market for a comparable amount and for a
comparable period, whether or not such Eurodollar Rate Loan was in fact so
funded.
3.06 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) A certificate of the Administrative Agent or any Lender
claiming compensation under this Article III and setting forth the additional
amount or amounts to be paid to it hereunder shall be conclusive in the absence
of manifest error. In determining such amount, the Administrative Agent or such
Lender may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under
Section 3.01 or 3.04, the Borrower may replace such Lender in accordance with
Section 11.16.
3.07 SURVIVAL.
All of the Borrower's obligations under this Article III shall survive
termination of the Aggregate Revolving Commitments and repayment of all
Obligations.
ARTICLE IV
GUARANTY
4.01 THE GUARANTY.
Each of the Guarantors hereby jointly and severally guarantees to each
Lender, each Affiliate of a Lender that enters into a Swap Contract or Treasury
Management Agreement, and the Administrative Agent as hereinafter provided, as
primary obligor and not as surety, the prompt payment of the Obligations in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or otherwise) strictly in
accordance with the terms thereof. The Guarantors hereby further agree that if
any of the Obligations are not paid in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise), the Guarantors will, jointly and severally,
promptly pay the same, without any demand or notice whatsoever, and that in the
case of any extension of time of payment or renewal of any of the Obligations,
the same will be promptly paid in full when due (whether at extended maturity,
as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) in accordance with the terms of such extension
or renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Loan Documents, Swap Contracts or Treasury Management
Agreements, the obligations of each Guarantor under this Agreement and the other
Loan Documents shall be limited to an aggregate amount equal to the largest
amount that would not render such obligations subject to avoidance under the
Debtor Relief Laws or any comparable provisions of any applicable state law.
4.02 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 4.01 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Loan Documents, Swap
Contracts or Treasury Management Agreements, or any other agreement or
instrument referred to therein, or any substitution, release, impairment or
exchange of any other guarantee of or security
46
for any of the Obligations, and, to the fullest extent permitted by applicable
law, irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety or guarantor,
it being the intent of this Section 4.02 that the obligations of the Guarantors
hereunder shall be absolute and unconditional under any and all circumstances.
Each Guarantor agrees that such Guarantor shall have no right of subrogation,
indemnity, reimbursement or contribution against the Borrower or any other
Guarantor for amounts paid under this Article IV until such time as the
Obligations have been paid in full and the Aggregate Revolving Commitments have
expired or terminated. Without limiting the generality of the foregoing, it is
agreed that, to the fullest extent permitted by law, the occurrence of any one
or more of the following shall not alter or impair the liability of any
Guarantor hereunder, which shall remain absolute and unconditional as described
above:
(a) at any time or from time to time, without notice to
any Guarantor, the time for any performance of or compliance with any
of the Obligations shall be extended, or such performance or compliance
shall be waived;
(b) any of the acts mentioned in any of the provisions of
any of the Loan Documents, any Swap Contract or Treasury Management
Agreement between any Loan Party and any Lender, or any Affiliate of a
Lender, or any other agreement or instrument referred to in the Loan
Documents or such Swap Contracts or Treasury Management Agreements
shall be done or omitted;
(c) the maturity of any of the Obligations shall be
accelerated, or any of the Obligations shall be modified, supplemented
or amended in any respect, or any right under any of the Loan
Documents, any Swap Contract or Treasury Management Agreement between
any Loan Party and any Lender, or any Affiliate of a Lender, or any
other agreement or instrument referred to in the Loan Documents or such
Swap Contracts or Treasury Management Agreements shall be waived or any
other guarantee of any of the Obligations or any security therefor
shall be released, impaired or exchanged in whole or in part or
otherwise dealt with;
(d) any Lien granted to, or in favor of, the
Administrative Agent or any Lender or Lenders as security for any of
the Obligations shall fail to attach or be perfected; or
(e) any of the Obligations shall be determined to be void
or voidable (including, without limitation, for the benefit of any
creditor of any Guarantor) or shall be subordinated to the claims of
any Person (including, without limitation, any creditor of any
Guarantor).
With respect to its obligations hereunder, each Guarantor hereby
expressly waives diligence, presentment, demand of payment, protest and all
notices whatsoever, and any requirement that the Administrative Agent or any
Lender exhaust any right, power or remedy or proceed against any Person under
any of the Loan Documents, any Swap Contract or Treasury Management Agreement
between any Loan Party and any Lender, or any Affiliate of a Lender, or any
other agreement or instrument referred to in the Loan Documents or such Swap
Contracts or Treasury Management Agreements, or against any other Person under
any other guarantee of, or security for, any of the Obligations.
4.03 REINSTATEMENT.
The obligations of the Guarantors under this Article IV shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Obligations is rescinded or must be
otherwise restored by any holder of any of the Obligations, whether as a result
of any proceedings in bankruptcy or reorganization or otherwise, and each
Guarantor agrees that it will indemnify the Administrative Agent and each Lender
on demand for all reasonable costs and expenses (including, without limitation,
reasonable fees and expenses of counsel) incurred by the Administrative Agent or
such
47
Lender in connection with such rescission or restoration, including any such
reasonable costs and expenses incurred in defending against any claim alleging
that such payment constituted a preference, fraudulent transfer or similar
payment under any bankruptcy, insolvency or similar law.
4.04 CERTAIN ADDITIONAL WAIVERS.
Each Guarantor agrees that such Guarantor shall have no right of
recourse to security for the Obligations, except through the exercise of rights
of subrogation pursuant to Section 4.02 and through the exercise of rights of
contribution pursuant to Section 4.06.
4.05 REMEDIES.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Obligations may be declared to be forthwith due
and payable as provided in Section 9.02 (and shall be deemed to have become
automatically due and payable in the circumstances provided in said Section
9.02) for purposes of Section 4.01 notwithstanding any stay, injunction or other
prohibition preventing such declaration (or preventing the Obligations from
becoming automatically due and payable) as against any other Person and that, in
the event of such declaration (or the Obligations being deemed to have become
automatically due and payable), the Obligations (whether or not due and payable
by any other Person) shall forthwith become due and payable by the Guarantors
for purposes of Section 4.01. The Guarantors acknowledge and agree that their
obligations hereunder are secured in accordance with the terms of the Collateral
Documents and that the Lenders may exercise their remedies thereunder in
accordance with the terms thereof.
4.06 RIGHTS OF CONTRIBUTION.
The Guarantors agree among themselves that, in connection with payments
made hereunder, each Guarantor shall have contribution rights against the other
Guarantors as permitted under applicable law. Such contribution rights shall be
subordinate and subject in right of payment to the obligations of such
Guarantors under the Loan Documents and no Guarantor shall exercise such rights
of contribution until all Obligations have been paid in full and the Commitments
have terminated.
4.07 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guarantee in this Article IV is a guaranty of payment and not of
collection, is a continuing guarantee, and shall apply to all Obligations
whenever arising.
ARTICLE V
CONDITIONS PRECEDENT TO CREDIT EXTENSIONS
5.01 CONDITIONS OF INITIAL CREDIT EXTENSION.
The obligation of each Lender to make its initial Credit Extension
hereunder is subject to satisfaction of the following conditions precedent:
(a) Loan Documents. Receipt by the Administrative Agent
of executed counterparts of this Agreement and the other Loan
Documents, each properly executed by a Responsible Officer of the
signing Loan Party and, in the case of this Agreement, by each Lender.
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(b) Organization Documents, Resolutions, Etc. Receipt by
the Administrative Agent of the following, each of which shall be
originals or facsimiles (followed promptly by originals), dated as of a
recent date before the Closing Date and in form and substance
satisfactory to the Administrative Agent and its legal counsel:
(i) copies of the Organization Documents of each
Loan Party certified to be true and complete as of a recent
date by the appropriate Governmental Authority of the state or
other jurisdiction of its incorporation or organization, where
applicable, and certified by a secretary or assistant
secretary of such Loan Party to be true and correct as of the
Closing Date;
(ii) such certificates of resolutions or other
action, incumbency certificates and/or other certificates of
Responsible Officers of each Loan Party as the Administrative
Agent may require evidencing the identity, authority and
capacity of each Responsible Officer thereof authorized to act
as a Responsible Officer in connection with this Agreement and
the other Loan Documents to which such Loan Party is a party;
and
(iii) such documents and certifications as the
Administrative Agent may reasonably require to evidence that
each Loan Party is duly organized or formed, and is validly
existing, in good standing and qualified to engage in business
in its state of organization or formation and the state in
which its principal place of business is located.
(c) Opinion of Counsel. Receipt by the Administrative
Agent of favorable opinions of counsel to the Loan Parties, addressed
to the Administrative Agent and each Lender, dated as of the Closing
Date, and in form and substance satisfactory to the Administrative
Agent.
(d) Perfection and Priority of Liens. Receipt by the
Administrative Agent of the following:
(i) searches of Uniform Commercial Code filings
in the jurisdiction of formation of each Loan Party, the
jurisdiction of the chief executive office of each Loan Party
and each jurisdiction where any Collateral is located, copies
of the financing statements on file in such jurisdictions and
evidence that no Liens exist other than Permitted Liens;
(ii) all certificates evidencing any certificated
Capital Stock pledged to the Administrative Agent pursuant to
the Pledge Agreement, together with duly executed in blank,
undated stock powers attached thereto (unless, with respect to
the pledged Capital Stock of any Foreign Subsidiary, such
stock powers are deemed unnecessary by the Administrative
Agent in its reasonable discretion under the law of the
jurisdiction of incorporation of such Person);
(iii) searches of ownership of, and Liens on,
intellectual property of each Loan Party in the appropriate
governmental offices; and
(iv) duly executed notices of grant of security
interest in the form required by the Security Agreement as are
necessary, in the Administrative Agent's sole discretion, to
perfect the Administrative Agent's security interest in the
intellectual property of the Loan Parties.
(e) Financial Statements. The Administrative Agent shall
have received:
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(i) the Audited Financial Statements;
(ii) the Interim Financial Statements;
(iii) such other information as the Administrative
Agent may reasonably request.
(f) No Material Adverse Change. There shall not have
occurred a material adverse change since December 31, 2002 in the
business, assets, liabilities (actual or contingent), operations,
financial condition or prospects of the Borrower and its Subsidiaries,
taken as a whole.
(g) Equity Proceeds. The Borrower shall have received
gross cash proceeds of at least $40,000,000 from the Equity Offering.
(h) Termination of Existing Credit Agreement; Repurchase
of CapitalSource Warrants. Receipt by the Administrative Agent of
evidence that all obligations under the Existing Credit Agreement have
been repaid (or will be repaid with the Loans made on the Closing Date)
and the commitments thereunder have been terminated.
(i) Evidence of Insurance. Receipt by the Administrative
Agent of copies of insurance policies or certificates of insurance of
the Borrower and its Subsidiaries evidencing liability and casualty
insurance meeting the requirements set forth in the Loan Documents,
including, but not limited to, naming the Administrative Agent as
additional insured (in the case of liability insurance) or loss payee
(in the case of hazard insurance) on behalf of the Lenders.
(j) Subordinated Indebtedness Documents. The
Administrative Agent shall have received a copy, certified by a
Responsible Officer of the Borrower as true and complete, of all
amendments and modifications, if any, to the Senior Subordinated Notes
Documents.
(k) Closing Certificate. Receipt by the Administrative
Agent of a certificate signed by a Responsible Officer of the Borrower
certifying that the conditions specified in Sections 5.01(f) and (g)
and Sections 5.02(a), (b) and (c) have been satisfied.
(l) Fees. Receipt by the Administrative Agent and the
Lenders of any fees required to be paid on or before the Closing Date.
(m) Attorney Costs. Unless waived by the Administrative
Agent, the Borrower shall have paid all Attorney Costs of the
Administrative Agent to the extent invoiced prior to or on the Closing
Date, plus such additional amounts of Attorney Costs as shall
constitute its reasonable estimate of Attorney Costs incurred or to be
incurred by it through the closing proceedings (provided that such
estimate shall not thereafter preclude a final settling of accounts
between the Borrower and the Administrative Agent).
(n) Other. Receipt by the Administrative Agent and the
Lenders of such other documents, instruments, agreements and
information as reasonably requested by the Administrative Agent or any
Lender, including, but not limited to, information regarding
litigation, tax, accounting, labor, insurance, pension liabilities
(actual or contingent), real estate leases, environmental matters,
material contracts, debt agreements, property ownership,
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contingent liabilities, employment agreements, non-compete agreements
and management of the Borrower and its Subsidiaries.
5.02 CONDITIONS TO ALL CREDIT EXTENSIONS.
The obligation of each Lender to honor any Request for Credit Extension
is subject to the following conditions precedent:
(a) The representations and warranties of each Loan Party
contained in Article VI or any other Loan Document, or which are
contained in any document furnished at any time under or in connection
herewith or therewith, shall be true and correct in all material
respects on and as of the date of such Credit Extension, except to the
extent that such representations and warranties specifically refer to
an earlier date, in which case they shall be true and correct as of
such earlier date, and except that for purposes of this Section 5.02,
the representations and warranties contained in subsections (a) and (b)
of Section 6.05 shall be deemed to refer to the most recent statements
furnished pursuant to clauses (a) and (b), respectively, of Section
7.01.
(b) No Default shall exist, or would result from such
proposed Credit Extension.
(c) There shall not have been commenced against the
Borrower or any Subsidiary an involuntary case under any applicable
Debtor Relief Law, now or hereafter in effect, or any case, proceeding
or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of
such Person or for any substantial part of its Property or for the
winding up or liquidation of its affairs, and such involuntary case or
other case, proceeding or other action shall remain undismissed.
(d) After giving effect to such Credit Extension, the
Total Revolving Outstandings shall not exceed the lesser of (i) the
Aggregate Revolving Commitments and (ii) the Borrowing Base.
(e) The Administrative Agent and, if applicable, the L/C
Issuer or the Swing Line Lender shall have received a Request for
Credit Extension in accordance with the requirements hereof.
Each Request for Credit Extension submitted by the Borrower shall be
deemed to be a representation and warranty that the conditions specified in
Sections 5.02(a), (b) and (c) have been satisfied on and as of the date of the
applicable Credit Extension.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Loan Parties represent and warrant to the Administrative Agent and
the Lenders that:
6.01 EXISTENCE, QUALIFICATION AND POWER.
Each Loan Party (a) is a corporation, partnership or limited liability
company duly organized or formed, validly existing and in good standing under
the Laws of the jurisdiction of its incorporation or organization, (b) has all
requisite power and authority and all requisite governmental licenses,
authorizations, consents and approvals to (i) own its assets and carry on its
business and (ii) execute, deliver and perform its obligations under the Loan
Documents to which it is a party, and (c) is duly
51
qualified and is licensed and in good standing under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification or license; except in each
case referred to in clause (b)(i) or (c), to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect.
6.02 AUTHORIZATION; NO CONTRAVENTION.
The execution, delivery and performance by each Loan Party of each Loan
Document to which such Person is party, have been duly authorized by all
necessary corporate or other organizational action, and do not (a) contravene
the terms of any Loan Party's Organization Documents; (b) conflict with or
result in any breach or contravention of, or the creation of any Lien under, (i)
any Contractual Obligation to which any Loan Party is a party or (ii) any order,
injunction, writ or decree of any Governmental Authority or any arbitral award
to which any Loan Party or the Property of any Loan Party is subject; (c)
violate any Law (including, without limitation, Regulation U or Regulation X
issued by the FRB); or (d) result in a limitation on any licenses, permits or
other approvals applicable to the business, operations or properties of any Loan
Party or adversely affect the ability of any Loan Party to participate in any
Medical Reimbursement Programs.
6.03 GOVERNMENTAL AUTHORIZATION; OTHER CONSENTS.
No approval, consent, exemption, authorization, or other action by, or
notice to, or filing with, any Governmental Authority or any other Person is
necessary or required in connection with the execution, delivery or performance
by, or enforcement against, any Loan Party of this Agreement or any other Loan
Document, other than (i) those that have already been obtained and are in full
force and effect and (ii) filings to perfect the Liens created by the Collateral
Documents.
6.04 BINDING EFFECT.
Each Loan Document has been duly executed and delivered by each Loan
Party that is party thereto. Each Loan Document constitutes a legal, valid and
binding obligation of each Loan Party that is party thereto, enforceable against
each such Loan Party in accordance with its terms, except as enforceability may
be limited by applicable Debtor Relief Laws or by equitable principles relating
to enforceability.
6.05 FINANCIAL STATEMENTS; NO MATERIAL ADVERSE EFFECT.
(a) The Audited Financial Statements (i) were prepared in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; (ii) fairly present in all material
respects the financial condition of the Borrower and its Subsidiaries as of the
date thereof and their results of operations for the period covered thereby in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; and (iii) show all material
indebtedness and other liabilities, direct or contingent, of the Borrower and
its Subsidiaries as of the date thereof, including liabilities for taxes,
commitments and Indebtedness.
(b) The Interim Financial Statements (i) were prepared in
accordance with GAAP consistently applied throughout the period covered thereby,
except as otherwise expressly noted therein; (ii) fairly present in all material
respects the financial condition of the Borrower and its Subsidiaries as of the
date thereof and their results of operations for the period covered thereby,
subject, in the case of clauses (i) and (ii), to the absence of footnotes and to
normal year-end audit adjustments; and (iii) show all material indebtedness and
other liabilities, direct or contingent, of the Borrower and its Subsidiaries as
of the date thereof, including liabilities for taxes, material commitments and
Indebtedness.
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(c) From the date of the Audited Financial Statements to and
including the Closing Date, there has been no Disposition by the Borrower or any
Subsidiary, or any Involuntary Disposition, of any material part of the business
or Property of the Borrower and its Subsidiaries, taken as a whole, and no
purchase or other acquisition by any of them of any business or property
(including any Capital Stock of any other Person) material in relation to the
consolidated financial condition of the Borrower and its Subsidiaries, taken as
a whole, in each case, which is not reflected in the foregoing financial
statements or in the notes thereto and has not otherwise been disclosed in
writing to the Lenders on or prior to the Closing Date.
(d) The financial statements delivered pursuant to Section 7.01(a)
and (b) have been prepared in accordance with GAAP (except as may otherwise be
permitted under Section 7.01(a) and (b)) and present fairly (on the basis
disclosed in the footnotes to such financial statements) in all material
respects the consolidated financial condition, results of operations and cash
flows of the Borrower and its Subsidiaries as of the dates thereof and for the
periods covered thereby.
(e) Since the date of the Audited Financial Statements there has
been no event or circumstance that has had or could reasonably be expected to
have a Material Adverse Effect.
6.06 LITIGATION.
There are no actions, suits, investigations, criminal prosecutions,
civil investigative demands, imposition of criminal or civil fines or penalties,
proceedings, claims or disputes pending or, to the knowledge of the Loan
Parties, threatened or contemplated, at law, in equity, in arbitration or before
any Governmental Authority, by or against the Borrower or any of its
Subsidiaries or against any of their properties or revenues that (a) purport to
affect or pertain to this Agreement or any other Loan Document, or (b) if
determined adversely, could reasonably be expected to have a Material Adverse
Effect.
6.07 NO DEFAULT.
(a) Neither the Borrower nor any Subsidiary is in default under or
with respect to any Contractual Obligation that could reasonably be expected to
have a Material Adverse Effect.
(b) No Default has occurred and is continuing.
6.08 OWNERSHIP OF PROPERTY; LIENS.
Each of the Borrower and its Subsidiaries has good record and
marketable title in fee simple to, or valid leasehold interests in, all real
property necessary or used in the ordinary conduct of its business, except for
such defects in title as could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. The Property of the Borrower and
its Subsidiaries is subject to no Liens, other than Permitted Liens.
6.09 ENVIRONMENTAL COMPLIANCE.
Except as could not reasonably be expected to have a Material Adverse
Effect:
(a) Each of the Facilities and all operations at the
Facilities are in compliance with all applicable Environmental Laws,
and there is no violation of any Environmental Law with respect to the
Facilities or the Businesses, and there are no conditions relating to
the Facilities or the Businesses that could give rise to liability
under any applicable Environmental Laws.
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(b) None of the Facilities contains, or has previously
contained, any Hazardous Materials at, on or under the Facilities in
amounts or concentrations that constitute or constituted a violation
of, or could give rise to liability under, Environmental Laws.
(c) Neither the Borrower nor any Subsidiary has received
any written or verbal notice of, or inquiry from any Governmental
Authority regarding, any violation, alleged violation, non-compliance,
liability or potential liability regarding environmental matters or
compliance with Environmental Laws with regard to any of the Facilities
or the Businesses, nor does any Responsible Officer of any Loan Party
have knowledge or reason to believe that any such notice will be
received or is being threatened.
(d) Hazardous Materials have not been transported or
disposed of from the Facilities, or generated, treated, stored or
disposed of at, on or under any of the Facilities or any other
location, in each case by or on behalf the Borrower or any Subsidiary
in violation of, or in a manner that would be reasonably likely to give
rise to liability under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Responsible Officers of the Loan Parties, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be
named as a party, nor are there any consent decrees or other decrees,
consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any
Environmental Law with respect to the Borrower, any Subsidiary, the
Facilities or the Businesses.
(f) There has been no release or, threat of release of
Hazardous Materials at or from the Facilities, or arising from or
related to the operations (including, without limitation, disposal) of
the Borrower or any Subsidiary in connection with the Facilities or
otherwise in connection with the Businesses, in violation of or in
amounts or in a manner that could give rise to liability under
Environmental Laws.
6.10 INSURANCE.
The properties of the Borrower and its Subsidiaries are insured with
financially sound and reputable insurance companies, in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or the applicable Subsidiary operates. The insurance coverage of
the Loan Parties as in effect on the Closing Date is outlined as to carrier,
policy number, expiration date, type, amount and deductibles on Schedule 6.10.
6.11 TAXES.
The Borrower and its Subsidiaries have filed all federal, state and
other material tax returns and reports required to be filed, and have paid all
federal, state and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP. There is no proposed tax
assessment against the Borrower or any Subsidiary that would, if made, have a
Material Adverse Effect.
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6.12 ERISA COMPLIANCE.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Internal Revenue Code and other federal or
state Laws. Each Plan that is intended to qualify under Section 401(a) of the
Internal Revenue Code has received a favorable determination letter from the IRS
or an application for such a letter is currently being processed by the IRS with
respect thereto and, to the knowledge of the Loan Parties, nothing has occurred
which would prevent, or cause the loss of, such qualification. Each Loan Party
and each ERISA Affiliate have made all required contributions to each Plan
subject to Section 412 of the Internal Revenue Code, and no application for a
funding waiver or an extension of any amortization period pursuant to Section
412 of the Internal Revenue Code has been made with respect to any Plan.
(b) There are no pending or, to the knowledge of the Loan Parties,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan that could be reasonably be expected to have a Material
Adverse Effect. There has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to
occur; (ii) no Pension Plan has any Unfunded Pension Liability; (iii) no Loan
Party or any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA with respect to any Pension Plan (other than
premiums due and not delinquent under Section 4007 of ERISA); (iv) no Loan Party
or any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) no Loan Party or any
ERISA Affiliate has engaged in a transaction that could be subject to Section
4069 or 4212(c) of ERISA.
6.13 SUBSIDIARIES.
Set forth on Schedule 6.13 is a complete and accurate list as of the
Closing Date of each Subsidiary, together with the percentage of outstanding
shares of each class owned (directly or indirectly) by the Borrower or any
Subsidiary. None of the shares of Capital Stock of any Subsidiary is subject to
any outstanding options, warrants, rights of conversion or purchase and all
other similar rights with respect thereto. The outstanding Capital Stock of each
Subsidiary is validly issued, fully paid and non-assessable.
6.14 MARGIN REGULATIONS; INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT.
(a) The Borrower is not engaged and will not engage, principally
or as one of its important activities, in the business of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the FRB), or
extending credit for the purpose of purchasing or carrying margin stock.
Following the application of the proceeds of each Borrowing or drawing under
each Letter of Credit, not more than 25% of the value of the assets (either of
the Borrower only or of the Borrower and its Subsidiaries on a consolidated
basis) subject to the provisions of Section 8.01 or Section 8.05 or subject to
any restriction contained in any agreement or instrument between the Borrower
and any Lender or any Affiliate of any Lender relating to Indebtedness and
within the scope of Section 9.01(e) will be margin stock.
(b) None of the Borrower, any Person Controlling the Borrower or
any Subsidiary (i) is a "holding company," or a "subsidiary company" of a
"holding company," or an "affiliate" of a "holding company" or of a "subsidiary
company" of a "holding company," within the meaning of the Public Utility
55
Holding Company Act of 1935, or (ii) is or is required to be registered as an
"investment company" under the Investment Company Act of 1940.
6.15 DISCLOSURE.
No report, financial statement, certificate or other information
furnished (whether in writing or orally) by or on behalf of any Loan Party to
the Administrative Agent or any Lender in connection with the transactions
contemplated hereby and the negotiation of this Agreement or delivered hereunder
(as modified or supplemented by other information so furnished) contains any
material misstatement of fact or omits to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; provided that, with respect to projected financial
information, the Loan Parties represent only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time.
6.16 COMPLIANCE WITH LAWS.
(a) Each of the Borrower and each Subsidiary is in compliance with
the requirements of all Laws (including, without limitation, Medicare
Regulations, Medicaid Regulations, HIPAA, 42 U.S.C. Section 1320a-7b and 42
U.S.C. Section 1395nn) and all orders, writs, injunctions, decrees, licenses and
permits applicable to it, its properties or the Facilities, except in such
instances in which (i) such requirement of Law or order, writ, injunction or
decree is being contested in good faith by appropriate proceedings diligently
conducted or (ii) the failure to comply therewith could not reasonably be
expected to have a Material Adverse Effect. Without limiting the generality of
the foregoing:
(A) neither the Borrower nor any Subsidiary, nor any
individual employed by the Borrower or any Subsidiary, would reasonably
be expected to have criminal culpability or to be excluded from
participation in any Medical Reimbursement Program for corporate or
individual actions or failures to act known to the Borrower or any
Subsidiary where such culpability or exclusion has resulted or could
reasonably be expected to result in an Exclusion Event;
(B) to the knowledge of the Loan Parties, no officer or
other member of management continues to be employed by the Borrower or
any Subsidiary who may reasonably be expected to have individual
culpability for matters under investigation by the OIG or other
Governmental Authority unless such officer or other member of
management has been, within a reasonable period of time after discovery
of such actual or potential culpability, either suspended or removed
from positions of responsibility related to those activities under
challenge by the OIG or other Governmental Authority;
(C) current billing policies, arrangements, protocols and
instructions of the Borrower and its Subsidiaries comply with
requirements of Medical Reimbursement Programs and are administered by
properly trained personnel, except where any such failure to comply
would not reasonably be expected to result in an Exclusion Event; and
(D) current medical director compensation arrangements of
the Borrower and its Subsidiaries comply with state and federal
anti-kickback, fraud and abuse, and self-referral laws, including
without limitation 42 U.S.C. Section 1320a-7b and 42 U.S.C. Section
1395nn, and all regulations promulgated under such laws, except where
any such failure to comply would not reasonably be expected to result
in an Exclusion Event.
(b) The Borrower has in place a compliance program for the
Borrower and its Subsidiaries that is reasonably designed to provide effective
internal controls that promote adherence to, prevent and detect
56
material violations of, any Laws applicable to the Borrower and its
Subsidiaries, and which includes the implementation of internal audits and
monitoring on a regular basis to monitor compliance with the compliance program
and with Laws.
6.17 INTELLECTUAL PROPERTY; LICENSES, ETC.
The Borrower and its Subsidiaries own, or possess the legal right to
use, all of the trademarks, service marks, trade names, copyrights, patents,
patent rights, franchises, licenses and other intellectual property rights
(collectively, "IP Rights") that are reasonably necessary for the operation of
their respective businesses, without conflict with the rights of any other
Person. Set forth on Schedule 6.17 is a list of all IP Rights registered or
pending registration with the United States Copyright Office or the United
States Patent and Trademark Office and owned by any Loan Party, or that any Loan
Party has the right to use, as of the Closing Date. Except for such claims and
infringements that could not reasonably be expected to have a Material Adverse
Effect, no claim has been asserted and is pending by any Person challenging or
questioning the use of any IP Rights or the validity or effectiveness of any IP
Rights, nor does any Loan Party know of any such claim, and, to the knowledge of
the Responsible Officers of the Loan Parties, the use of any IP Rights by the
Borrower or any Subsidiary or the granting of a right or a license in respect of
any IP Rights from the Borrower or any Subsidiary does not infringe on the
rights of any Person. As of the Closing Date, none of the IP Rights owned by any
of the Loan Parties is subject to any licensing agreement or similar arrangement
except as set forth on Schedule 6.17.
6.18 BROKER'S FEES.
Neither the Borrower nor any Subsidiary has any obligation to any
Person in respect of any finder's, broker's, investment banking or other similar
fee in connection with any of the transactions contemplated under the Loan
Documents.
6.19 LABOR MATTERS.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of the Borrower or any Subsidiary as of the Closing Date
and neither the Borrower nor any Subsidiary has suffered any strikes, walkouts,
work stoppages or other material labor difficulty within the last five years.
6.20 BUSINESS LOCATIONS.
Set forth on Schedule 6.20(a) is a list of all real property located in
the United States that is owned or leased by any Loan Party as of the Closing
Date. Set forth on Schedule 6.20(b) is a list of all locations where any
tangible personal property of any Loan Party is located as of the Closing Date.
Set forth on Schedule 6.20(c) is the chief executive office, tax payer
identification number and organizational identification number of each Loan
Party as of the Closing Date. The exact legal name and state of organization of
each Loan Party is as set forth on the signature pages hereto. Except as set
forth on Schedule 6.20(e), no Loan Party has during the five years preceding the
Closing Date (i) changed its legal name, (ii) changed its state of formation, or
(iii) been party to a merger, consolidation or other change in structure.
6.21 PERFECTION OF SECURITY INTERESTS IN THE COLLATERAL.
The Collateral Documents create valid security interests in, and Liens
on, the Collateral purported to be covered thereby, which security interests and
Liens are currently perfected security interests and Liens, prior to all other
Liens other than Permitted Liens.
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6.22 TAX SHELTER REGULATIONS.
The Borrower does not intend to treat the Loans and/or Letters of
Credit and related transactions as being a "reportable transaction" (within the
meaning of Treasury Regulation Section 1.6011-4). In the event the Borrower
determines to take any action inconsistent with such intention, it will promptly
notify the Administrative Agent thereof. If the Borrower so notifies the
Administrative Agent, the Borrower acknowledges that one or more of the Lenders
may treat its Loans and/or its interest in Swing Line Loans and/or Letters of
Credit as part of a transaction that is subject to Treasury Regulation Section
301.6112-1, and such Lender or Lenders, as applicable, will maintain the lists
and other records required by such Treasury Regulation.
6.23 SUBORDINATION.
(a) The Obligations are "Senior Debt" under the Senior
Subordinated Notes Documents.
(b) The Obligations are "Designated Senior Debt" under the Senior
Subordinated Notes Documents and no other Indebtedness or other obligations
constitute "Designated Senior Debt" under the Senior Subordinated Notes
Documents.
(c) The Obligations are "Senior Debt" under the Sunrise
Subordination Agreement.
6.24 FRAUD AND ABUSE.
To the knowledge of the Responsible Officers of the Loan Parties,
neither the Borrower nor any Subsidiary nor any of their respective officers or
directors has engaged in any activities that are prohibited under any applicable
provision of the Social Security Act and the regulations promulgated thereunder,
including HIPAA, the Medicare Regulations or the Medicaid Regulations that could
reasonably be expected to have a Material Adverse Effect.
6.25 LICENSING AND ACCREDITATION.
(a) Except to the extent it would not reasonably be expected to
have a Material Adverse Effect, each of the Borrower and its Subsidiaries has,
to the extent applicable: (i) obtained (or been duly assigned) all required
certificates of need or determinations of need as required by the relevant state
Governmental Authority for the acquisition, construction, expansion of,
investment in or operation of its businesses and Facilities as currently
operated; (ii) obtained and maintains in good standing all required licenses,
permits, authorizations and approvals of each Governmental Authority necessary
to the conduct of its business and Facilities; (iii) to the extent prudent and
customary in the industry in which it is engaged, obtained and maintains
accreditation from all generally recognized accrediting agencies; (iv) entered
into and maintains in good standing its Medicare Provider Agreements and
Medicaid Provider Agreements; and (v) ensured that all such required licenses
are in full force and effect on the date hereof and have not been revoked or
suspended or otherwise limited.
(b) To the knowledge of the Loan Parties, each Contract Provider
is duly licensed by each state, state agency, commission or other Governmental
Authority having jurisdiction over the provision of such services by such Person
in the locations where the Borrower and its Subsidiaries conduct business, to
the extent such licensing is required to enable such Person to provide the
professional services provided by such Person and otherwise as is necessary to
enable the Borrower and its Subsidiaries to operate as currently operated and as
contemplated to be operated.
6.26 REIMBURSEMENT FROM MEDICAL REIMBURSEMENT PROGRAMS.
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The accounts receivable of Borrower and its Subsidiaries have been and
will continue to be adjusted to reflect the reimbursement policies (both those
most recently published in writing as well as those not in writing which have
been verbally communicated) of Medical Reimbursement Programs, including without
limitation Medicare, Medicaid, Blue Cross/Blue Shield, private insurance
companies, health maintenance organizations, preferred provider organizations,
alternative delivery systems, managed care systems, government contracting
agencies and other third party payors. In particular, accounts receivable
relating to such Medical Reimbursement Programs do not and shall not exceed in
any material respect amounts any obligee is entitled to receive under any
capitation arrangement, fee schedule, discount formula, cost-based reimbursement
or other adjustment or limitation to its usual charges.
6.27 MEDICARE AND MEDICAID NOTICES AND FILINGS RELATED TO HEALTH CARE
BUSINESS.
With respect to Borrower and its Subsidiaries, to the extent applicable
and except to the extent as would not be reasonably be expected to have a
Material Adverse Effect: (i) each has timely filed all reports required to be
filed in connection with Medicare and applicable Medicaid programs and due on or
before the date hereof, and all required reports and administrative forms and
filings are true and complete in all material respects; (ii) there are no
claims, actions, proceedings or appeals pending (and neither Borrower nor any of
its Subsidiaries has filed anything that would result in any claims, actions or
appeals) before any Governmental Authority with respect to any Medicare or
Medicaid cost reports or claims filed by the Borrower or any of its Subsidiaries
on or before the date hereof, or with respect to any adjustments, denials,
recoupments or disallowances by any intermediary, carrier, other insurer,
commission, board or agency in connection with any cost reports or claims; (iii)
no validation review, survey, inspection, audit, investigation or program
integrity review related to the Borrower or any Subsidiary has been conducted by
any Governmental Authority or government contractor in connection with the
Medicare or Medicaid programs, and no such reviews are scheduled, pending or,
threatened against or affecting the Borrower or any Subsidiary; and (iv) each
has timely filed all material reports, data and other information required by
any other Governmental Authority with authority to regulate the Borrower or any
Subsidiary or its business in any manner.
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Revolving Commitment hereunder,
any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or
any Letter of Credit shall remain outstanding, the Loan Parties shall and shall
cause each Subsidiary to:
7.01 FINANCIAL STATEMENTS.
Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders:
(a) as soon as available, but in any event within ninety
(90) days after the end of each fiscal year of the Borrower,
consolidated and consolidating balance sheets of the Borrower and its
Subsidiaries as at the end of such fiscal year, and the related
consolidated and consolidating statements of income or operations,
retained earnings, shareholders' equity and cash flows for such fiscal
year, setting forth in each case in comparative form the figures as of
the end of and for the previous fiscal year, all in reasonable detail
and prepared in accordance with
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GAAP, audited and accompanied by a report and opinion of Ernst & Young
or other independent certified public accountants of nationally
recognized standing reasonably acceptable to the Required Lenders,
which report and opinion shall be prepared in accordance with generally
accepted auditing standards and shall not be subject to any "going
concern" or like qualification or exception or any qualification or
exception as to the scope of such audit; and
(b) as soon as available, but in any event within
forty-five (45) days after the end of each of the first three fiscal
quarters of each fiscal year of the Borrower, consolidated and
consolidating balance sheets of the Borrower and its Subsidiaries as at
the end of such fiscal quarter, and the related consolidated and
consolidating statements of income or operations, retained earnings,
shareholders' equity and cash flows for such fiscal quarter and for the
portion of the Borrower's fiscal year then ended, setting forth in each
case in comparative form the figures as of the end of and for the
corresponding fiscal quarter of the previous fiscal year and the
corresponding portion of the previous fiscal year, all in reasonable
detail and certified by a Responsible Officer of the Borrower as fairly
presenting in all material respects the financial condition, results of
operations, shareholders' equity and cash flows of the Borrower and its
Subsidiaries in accordance with GAAP, subject only to normal year-end
audit adjustments and the absence of footnotes.
As to any information contained in materials furnished pursuant to
Section 7.02(f)(i), the Borrower shall not be separately required to
furnish such information under clause (a) or (b) above, but the
foregoing shall not be in derogation of the obligation of the Borrower
to furnish the information and materials described in subsections (a)
and (b) above at the times specified therein.
7.02 CERTIFICATES; OTHER INFORMATION.
Deliver to the Administrative Agent and each Lender, in form and detail
satisfactory to the Administrative Agent and the Required Lenders:
(a) concurrently with the delivery of the financial
statements referred to in Section 7.01(a), a certificate of its
independent certified public accountants certifying such financial
statements and stating that in making the examination necessary
therefor no knowledge was obtained of any Default under any of the
financial covenants contained in Section 8.11 or, if any such Default
shall exist, stating the nature and status of such event;
(b) concurrently with the delivery of the financial
statements referred to in Sections 7.01(a) and (b), a duly completed
Compliance Certificate signed by a Responsible Officer of the Borrower;
(c) within fifteen (15) days after the end of each
calendar month, a certificate (the "Borrowing Base Certificate") from a
Responsible Officer of the Borrower setting forth the Borrowing Base
and its components as of the end of the immediately preceding month
substantially in the form attached as Exhibit E;
(d) within sixty (60) days after end of each fiscal year,
the annual business plan and budget of the Borrower and its
Subsidiaries containing, among other things, projected financial
statements for each quarter of the next fiscal year;
(e) copies of any detailed audit reports, management
letters or recommendations submitted to the board of directors (or the
audit committee of the board of directors) of the
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Borrower by independent accountants in connection with the accounts or
books of the Borrower or any Subsidiary, or any audit of any of them;
(f) promptly after the same are available, (i) copies of
each annual report, proxy or financial statement or other report or
communication sent to the stockholders of the Borrower, and copies of
all annual, regular, periodic and special reports and registration
statements which the Borrower may file or be required to file with the
SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934 or
to a holder of any Indebtedness owed by the Borrower or any Subsidiary
in its capacity as such a holder and not otherwise required to be
delivered to the Administrative Agent pursuant hereto and (ii) upon the
request of the Administrative Agent, all reports and written
information to and from the United States Environmental Protection
Agency, or any state or local agency responsible for environmental
matters, the United States Occupational Health and Safety
Administration, or any state or local agency responsible for health and
safety matters, or any successor agencies or authorities concerning
environmental, health or safety matters;
(g) promptly, such additional information regarding the
business, financial or corporate affairs of the Borrower or any
Subsidiary, or compliance with the terms of the Loan Documents, as the
Administrative Agent or any Lender may from time to time reasonably
request;
(h) promptly after the Borrower has notified the
Administrative Agent of any intention by the Borrower to treat the
Loans and/or Letters of Credit and related transactions as being a
"reportable transaction" (within the meaning of Treasury Regulation
Section 1.6011-4), a duly completed copy of IRS Form 8886 or any
successor form.
Documents required to be delivered pursuant to Section 7.01(a) or (b)
or Section 7.02(f) may (to the extent any such documents are included in
materials otherwise filed with the SEC) be delivered electronically and if so
delivered, shall be deemed to have been delivered on the date (i) on which the
Borrower posts such documents, or provides a link thereto on the Borrower's
website on the Internet at the website address listed on Schedule 11.02; or (ii)
on which such documents are posted on the Borrower's behalf on
IntraLinks/IntraAgency or another relevant website, if any, to which each Lender
and the Administrative Agent have access (whether a commercial, third-party
website or whether sponsored by the Administrative Agent); provided that: (i)
the Borrower shall deliver paper copies of such documents to the Administrative
Agent or any Lender that requests the Borrower to deliver such paper copies
until a written request to cease delivering paper copies is given by the
Administrative Agent or such Lender and (ii) the Borrower shall notify (which
may be by facsimile or electronic mail) the Administrative Agent and each Lender
of the posting of any such documents and provide to the Administrative Agent by
electronic mail electronic versions (i.e., soft copies) of such documents.
Notwithstanding anything contained herein, in every instance the Borrower shall
be required to provide paper copies of the Compliance Certificates required by
Section 7.02(b) to the Administrative Agent and each of the Lenders. Except for
such Compliance Certificates, the Administrative Agent shall have no obligation
to request the delivery or to maintain copies of the documents referred to
above, and in any event shall have no responsibility to monitor compliance by
the Borrower with any such request for delivery, and each Lender shall be solely
responsible for requesting delivery to it or maintaining its copies of such
documents.
7.03 NOTICES.
(a) Promptly (and in any event within five (5) Business Days)
after any Loan Party obtains knowledge thereof, notify the Administrative Agent
and each Lender of the occurrence of any Default.
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(b) Promptly after any Loan Party obtains knowledge thereof,
notify the Administrative Agent and each Lender of any matter that has resulted
or could reasonably be expected to result in a Material Adverse Effect.
(c) Promptly after any Loan Party obtains knowledge thereof,
notify the Administrative Agent and each Lender of the occurrence of any ERISA
Event.
(d) Promptly notify the Administrative Agent and each Lender of
any material change in accounting policies or financial reporting practices by
the Borrower or any Subsidiary.
(e) Promptly after any Loan Party obtains knowledge thereof,
notify the Administrative Agent and each Lender of any litigation, investigation
or proceeding affecting any Loan Party in which the amount involved or relief
sought would reasonably be expected to have a Material Adverse Effect; and
(f) Promptly after any Loan Party obtains knowledge thereof,
notify the Administrative Agent and each Lender (i) the institution of any
investigation, review or proceeding against any Loan Party to suspend, revoke or
terminate (or that may result in the termination of) any Medicaid Provider
Agreement or Medicare Provider Agreement, or any such investigation or
proceeding that may result in an Exclusion Event or (ii) any notice of loss or
threatened loss of accreditation, loss of participation under any Medical
Reimbursement Program or loss of applicable health care license, in the case of
clauses (i) and (ii), that would reasonably be expected to result in a Material
Adverse Effect.
(g) Upon the reasonable written request of the Administrative
Agent following the occurrence of any event or the discovery of any condition
which the Administrative Agent or the Required Lenders reasonably believe has
caused (or could be reasonably expected to cause) the representations and
warranties set forth in Section 6.09 to be untrue in any material respect,
furnish or cause to be furnished to the Administrative Agent, at the Loan
Parties' expense, a report of an environmental assessment of reasonable scope,
form and depth, (including, where appropriate, invasive soil or groundwater
sampling) by a consultant reasonably acceptable to the Administrative Agent as
to the nature and extent of the presence of any Materials of Environmental
Concern on any Facilities and as to the compliance by the Borrower or any of its
Subsidiaries with Environmental Laws at such Facilities. If the Loan Parties
fail to deliver such an environmental report within seventy-five (75) days after
receipt of such written request then the Administrative Agent may arrange for
same, and the Loan Parties hereby grant to the Administrative Agent and its
representatives access to the Facilities to reasonably undertake such an
assessment (including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment arranged for by the
Administrative Agent pursuant to this provision will be payable by the Loan
Parties on demand and added to the obligations secured by the Collateral
Documents.
Each notice pursuant to this Section 7.03 shall be accompanied by a
statement of a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein and stating what action the Borrower has taken
and proposes to take with respect thereto. Each notice pursuant to Section
7.03(a) shall describe with particularity any and all provisions of this
Agreement and any other Loan Document that have been breached.
7.04 PAYMENT OF OBLIGATIONS.
Pay and discharge as the same shall become due and payable, all its
obligations and liabilities, including (a) all tax liabilities, assessments and
governmental charges or levies upon it or its properties or assets, unless the
same are being contested in good faith by appropriate proceedings diligently
conducted and adequate reserves in accordance with GAAP are being maintained by
the Borrower or such
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Subsidiary; and (b) all lawful claims which, if unpaid, would by law become a
Lien upon its Property unless the same are being contested in good faith by
appropriate proceedings diligently conducted and adequate reserves in accordance
with GAAP are being maintained by the Borrower or such Subsidiary.
7.05 PRESERVATION OF EXISTENCE, ETC.
(a) Preserve, renew and maintain in full force and effect its
legal existence under the Laws of the jurisdiction of its organization except in
a transaction permitted by Section 8.04 or 8.05.
(b) Preserve, renew and maintain in full force and effect its good
standing under the Laws of the jurisdiction of its organization, except to the
extent the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
(c) Take all reasonable action to maintain all rights, privileges,
permits, licenses, franchises, certifications and approvals as are necessary for
the conduct of its business as currently conducted and herein contemplated,
including without limitation professional licenses, CLIA certifications,
Medicare Provider Agreements and Medicaid Provider Agreements, except to the
extent the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
(d) Preserve or renew all of its material registered patents,
copyrights, trademarks, trade names and service marks, except to the extent the
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
7.06 MAINTENANCE OF PROPERTIES.
(a) Maintain, preserve and protect all of its material properties
and equipment necessary in the operation of its business in good working order
and condition, ordinary wear and tear and Involuntary Dispositions excepted.
(b) Make all necessary repairs thereto and renewals and
replacements thereof, except to the extent the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
(c) Use the standard of care typical in the industry in the
operation and maintenance of its facilities.
7.07 MAINTENANCE OF INSURANCE.
Maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance, business
interruption insurance and reinsurance) with financially sound and reputable
insurance companies, in such amounts, with such deductibles and covering such
risks as are customarily carried by companies engaged in similar businesses and
owning similar properties in localities where the Borrower or the applicable
Subsidiary operates. The Administrative Agent shall be named as loss payee or
mortgagee, as its interest may appear, and/or additional insured with respect to
any such insurance providing coverage in respect of any Collateral, and each
provider of any such insurance shall agree, by endorsement upon the policy or
policies issued by it or by independent instruments furnished to the
Administrative Agent, that it will give the Administrative Agent thirty (30)
days prior written notice before any such policy or policies shall be altered or
canceled.
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7.08 COMPLIANCE WITH LAWS.
Except the extent the failure to do so would not reasonably be expected
to result in a Material Adverse Effect:
(a) Comply with the requirements of all Laws (including
without limitation Titles XVIII and XIX of the Social Security Act,
HIPAA, Medicare Regulations, Medicaid Regulations) and all orders,
writs, injunctions and decrees applicable to it or to its business or
Property, except in such instances in which such requirement of Law or
order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted;
(b) Ensure that (i) billing policies, arrangements,
protocols and instructions will comply with reimbursement requirements
under Medicare, Medicaid and other Medical Reimbursement Programs and
will be administered by properly trained personnel; and (ii) medical
director compensation arrangements and other arrangements with
referring physicians will comply with applicable state and federal
self-referral and anti-kickback laws, including without limitation 42
U.S.C. Section 1320a-7b(b)(1) - (b)(2) 42 U.S.C. and 42 U.S.C. Section
1395nn; and
(c) Make commercially reasonable efforts to implement
policies that are consistent with HIPAA on or before the date that any
provision of HIPAA becomes applicable to the Borrower and its
Subsidiaries.
7.09 BOOKS AND RECORDS.
(a) Maintain proper books of record and account, in which full,
true and correct entries in conformity with GAAP consistently applied shall be
made of all financial transactions and matters involving the assets and business
of the Borrower or such Subsidiary, as the case may be.
(b) Maintain such books of record and account in material
conformity with all applicable requirements of any Governmental Authority having
regulatory jurisdiction over the Borrower or such Subsidiary, as the case may
be.
7.10 INSPECTION RIGHTS.
(a) Permit representatives and independent contractors of the
Administrative Agent and each Lender to visit and inspect any of its properties,
to examine its corporate, financial and operating records, and make copies
thereof or abstracts therefrom, and to discuss its affairs, finances and
accounts with its directors, officers, and independent public accountants
(provided that the Borrower shall be provided an opportunity to attend such
meetings), all at the expense of the Lenders and at such reasonable times during
normal business hours and as often as may be reasonably desired, upon reasonable
advance notice to the Borrower; provided, however, that when an Event of Default
exists the Administrative Agent or any Lender (or any of their respective
representatives or independent contractors) may do any of the foregoing at the
expense of the Borrower at any time during normal business hours and without
advance notice.
(b) Permit representatives and independent contractors of the
Administrative Agent to conduct an annual audit of the Collateral at the expense
of the Borrower upon reasonable advance notice to the Borrower. To the extent
required by applicable Law, prior to receiving any information that contains
patient information subject to (i) state privacy laws, (ii) the Drug Abuse
Prevention, Treatment and Xxxxxxxxxxxxxx Xxx, 00 X.X.X. 000xx-0 et seq., (iii)
the Health Insurance Portability and
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Accountability Act of 1996, 42 U.S.C. 1320d et seq., or (iv) regulations
promulgated pursuant to the foregoing statutes, the Administrative Agent and the
Lenders agree to execute an agreement reasonably satisfactory to the
Administrative Agent and the Lenders that complies with the requirements
relating to "business associates" as set forth in 45 C.F.R. 502(e) and any
applicable state Laws.
7.11 USE OF PROCEEDS.
Use the proceeds of the Credit Extensions (a) to refinance Indebtedness
of the Borrower and its Subsidiaries under the Existing Credit Agreement, (b) to
finance working capital, capital expenditures and other general corporate
purposes and (c) to finance Permitted Acquisitions, provided that in no event
shall be the proceeds of the Credit Extensions be used in contravention of any
Law or of any Loan Document.
7.12 ADDITIONAL SUBSIDIARIES.
(a) Within thirty (30) days after the acquisition or formation of
any Subsidiary:
(i) notify the Administrative Agent thereof in writing,
together with (i) jurisdiction of formation, (ii) number of shares of
each class of Capital Stock outstanding, (iii) number and percentage of
outstanding shares of each class owned (directly or indirectly) by the
Borrower or any Subsidiary and (iv) number and effect, if exercised, of
all outstanding options, warrants, rights of conversion or purchase and
all other similar rights with respect thereto; and
(ii) cause such Subsidiary (other than any Excluded
Subsidiary) to (A) become a Guarantor by executing and delivering to
the Administrative Agent a Joinder Agreement or such other document as
the Administrative Agent shall deem appropriate for such purpose, and
(B) deliver to the Administrative Agent documents of the types referred
to in Sections 5.01(b) and (d) and favorable opinions of counsel to
such Person (which shall cover, among other things, the legality,
validity, binding effect and enforceability of the documentation
referred to in clause (a)), all in form, content and scope reasonably
satisfactory to the Administrative Agent; provided, however, (x) if
such Subsidiary is a Foreign Subsidiary and compliance with clause (A)
above would reasonably be expected to cause any material adverse tax
consequences to the Borrower, then such Subsidiary shall not be
required to comply with this clause (ii) and (y) if such Subsidiary is
an Immaterial Subsidiary, then such Subsidiary shall not be required to
comply with this clause (ii) so long as the aggregate amount of assets
owned by all Immaterial Subsidiaries that are not Guarantors does not,
as of any date of determination, exceed $250,000 in the aggregate.
(b) Guarantee of Subordinated Indebtedness. If any Subsidiary that
is not a Guarantor (including any Foreign Subsidiary, any Excluded Subsidiary
and any Immaterial Subsidiary) provides a Guarantee in respect of any
Subordinated Indebtedness, such Subsidiary shall, concurrent with providing the
Guarantee in respect of such Subordinated Indebtedness, (i) become a Guarantor
by executing and delivering to the Administrative Agent a Joinder Agreement or
such other document as the Administrative Agent shall deem appropriate for such
purpose, and (ii) deliver to the Administrative Agent documents of the types
referred to in Sections 5.01(b) and (d) and favorable opinions of counsel to
such Person (which shall cover, among other things, the legality, validity,
binding effect and enforceability of the documentation referred to in clause
(a)), all in form, content and scope reasonably satisfactory to the
Administrative Agent.
7.13 ERISA COMPLIANCE.
Do, and cause each of its ERISA Affiliates to do, each of the
following: (a) maintain each Plan in compliance in all material respects with
the applicable provisions of ERISA, the Internal Revenue Code
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and other federal or state law; (b) cause each Plan that is qualified under
Section 401(a) of the Internal Revenue Code to maintain such qualification; and
(c) make all required contributions to any Plan subject to Section 412 of the
Internal Revenue Code.
7.14 PLEDGED ASSETS.
Subject to Section 7.15, (a) cause all of the owned and leased Property
(other than Excluded Property) of each Loan Party to be subject at all times to
first priority, perfected Liens and, in the case of owned and leased real
property, title insured Liens in favor of the Administrative Agent to secure the
Obligations pursuant to the terms and conditions of the Collateral Documents or,
with respect to any such Property acquired subsequent to the Closing Date, such
other additional security documents as the Administrative Agent shall reasonably
request, subject in any case to Permitted Liens and (b) deliver such other
documentation as the Administrative Agent may reasonably request in connection
with the foregoing, including, without limitation, appropriate UCC-1 financing
statements, real estate title insurance policies, surveys, environmental
reports, landlord's waivers, certified resolutions and other organizational and
authorizing documents of such Person, favorable opinions of counsel to such
Person (which shall cover, among other things, the legality, validity, binding
effect and enforceability of the documentation referred to above and the
perfection of the Administrative Agent's Liens thereunder) and other items of
the types required to be delivered pursuant to Section 5.01(d), all in form,
content and scope reasonably satisfactory to the Administrative Agent.
Without limiting the generality of the above, the Loan Parties will
cause (a) 100% of the issued and outstanding Capital Stock of each Domestic
Subsidiary and (b) 65% (or such greater percentage that, due to a change in an
applicable Law after the date hereof, (1) could not reasonably be expected to
cause the undistributed earnings of such Foreign Subsidiary as determined for
United States federal income tax purposes to be treated as a deemed dividend to
such Foreign Subsidiary's United States parent and (2) could not reasonably be
expected to cause any material adverse tax consequences) of the issued and
outstanding Capital Stock entitled to vote (within the meaning of Treas. Reg.
Section 1.956-2(c)(2)) and 100% of the issued and outstanding Capital Stock not
entitled to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2)) in
each Foreign Subsidiary directly owned by the Borrower or any Domestic
Subsidiary to be subject at all times to a first priority, perfected Lien in
favor of the Administrative Agent pursuant to the terms and conditions of the
Collateral Documents or such other security documents as the Administrative
Agent shall reasonably request.
With respect to each Account for which either the perfection,
enforceability, or validity of the Administrative Agent's Liens in such Account,
or the Administrative Agent's right or ability to obtain direct payment to the
Administrative Agent of the proceeds of such Account, is governed by any
federal, state, or local statutory requirements other than those of the Uniform
Commercial Code, the Loan Parties will take such steps as the Administrative
Agent may from time to time reasonably request, including, without limitation,
compliance with the Federal Assignment of Claims Act of 1940, as amended, the
Social Security Act, the Medicare Regulations and the Medicaid Regulations.
7.15 POST-CLOSING MATTERS.
(a) Interest Rate Protection Agreement(s). Within sixty (60) days
of the Closing Date the Borrower shall enter into interest rate protection
agreements (protecting against fluctuations in interest rates) reasonably
acceptable to the Administrative Agent, which agreements shall provide coverage
for an amount reasonably satisfactory to the Administrative Agent and for a
duration reasonably satisfactory to the Administrative Agent.
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(b) Local Counsel Opinions. Within sixty (60) days of the Closing
Date the Borrower shall deliver to the Administrative Agent a favorable opinion
of counsel to each Subsidiary formed under the laws of the State of Texas,
addressed to the Administrative Agent and each Lender and in form and substance
satisfactory to the Administrative Agent (such opinion shall cover, among other
things, the authorization, execution and enforceability of the Loan Documents to
which such Subsidiaries are party).
(c) Real Property. With respect to each real property owned by any
Loan Party on the Closing Date (other than Excluded Property), deliver to the
Administrative Agent within sixty (60) days of the Closing Date, each in form
and substance reasonably satisfactory to the Administrative Agent:
(i) a Mortgage Instrument encumbering the fee interest of
any Loan Party in such Mortgaged Property;
(ii) ALTA (or equivalent) mortgagee title insurance policy
(the "Mortgage Policy") issued by a title insurance company reasonably
satisfactory to the Administrative Agent (the "Title Insurance
Company") with respect to such Mortgaged Property, assuring the
Administrative Agent that the applicable Mortgage Instrument creates a
valid and enforceable first priority mortgage lien on such Mortgaged
Property, free and clear of all defects and encumbrances except
Permitted Liens, which Mortgage Policy shall otherwise be in form and
substance reasonably satisfactory to the Administrative Agent and shall
be in amounts satisfactory to the Administrative Agent and shall
include such coverages, endorsements and reinsurance as are reasonably
requested by the Administrative Agent;
(iii) an as-built survey of each of the site of such
Mortgaged Property certified to the Title Insurance Company and, if
requested by the Administrative Agent, the Administrative Agent, in a
manner reasonably satisfactory to the Title Insurance Company and, if
applicable, the Administrative Agent, dated a date reasonably
satisfactory to each of the Administrative Agent and the Title
Insurance Company by an independent professional licensed land
surveyor, which surveys shall be sufficient to delete any standard
printed survey exception contained in the applicable title policy and
be made in accordance with the Minimum Standard Detail Requirements for
Land Title Surveys jointly established and adopted by the American Land
Title Association and the American Congress on Surveying and Mapping in
1999 with all items from Table A thereof completed, except for Nos. 5
and 12;
(iv) evidence as to (A) whether such Mortgaged Property is
in an area designated by the Federal Emergency Management Agency as
having special flood or mud slide hazards (a "Flood Hazard Property")
and (B) if such Mortgaged Property is a Flood Hazard Property, (1)
whether the community in which such Mortgaged Property is located is
participating in the National Flood Insurance Program, (2) the
applicable Loan Party's written acknowledgment of receipt of written
notification from the Administrative Agent (a) as to the fact that such
Mortgaged Property is a Flood Hazard Property and (b) as to whether the
community in which each such Flood Hazard Property is located is
participating in the National Flood Insurance Program and (3) copies of
insurance policies or certificates of insurance of the Borrower and its
Subsidiaries evidencing flood insurance satisfactory to the
Administrative Agent and naming the Administrative Agent as sole loss
payee on behalf of the Lenders;
(v) if requested by the Administrative Agent, evidence
reasonably satisfactory to the Administrative Agent that such Mortgaged
Property, and the uses of such Mortgaged Property, are in compliance in
all material respects with all applicable zoning laws, regulations,
ordinances and requirements (the evidence submitted as to which should
include the zoning designation made for such Mortgaged Property, the
permitted uses of such Mortgaged Property under such
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zoning designation and, if available, zoning requirements as to
parking, lot size, ingress, egress and building setbacks);
(vi) a legal opinion of special local counsel for the Loan
Parties for the state in which such Mortgaged Property is located in
form and substance reasonably acceptable to the Administrative Agent;
(ix) evidence reasonably satisfactory to the
Administrative Agent of comprehensive "all risk" insurance with respect
to such Mortgaged Property in form and substance satisfactory to the
Administrative Agent; and
(x) if requested by the Administrative Agent, an
environmental assessment of such Mortgaged Property from an environmental
consulting firm acceptable to the Administrative Agent.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Revolving Commitment hereunder,
any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, or
any Letter of Credit shall remain outstanding, no Loan Party shall, nor shall it
permit any Subsidiary to, directly or indirectly:
8.01 LIENS.
Create, incur, assume or suffer to exist any Lien upon any of its
Property, whether now owned or hereafter acquired, other than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on
Schedule 8.01 and any renewals or extensions thereof, provided that the
Property covered thereby is not increased and any renewal or extension
of the obligations secured or benefited thereby is permitted by Section
8.03(b);
(c) Liens (other than Liens imposed under ERISA) for
taxes, assessments or governmental charges or levies not yet due or
which are being contested in good faith and by appropriate proceedings
diligently conducted, if adequate reserves with respect thereto are
maintained on the books of the applicable Person in accordance with
GAAP;
(d) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens
imposed by law or pursuant to customary reservations or retentions of
title arising in the ordinary course of business, provided that such
Liens secure only amounts not yet due and payable or, if due and
payable, are unfiled and no other action has been taken to enforce the
same or are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have
been established;
(e) pledges or deposits in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other social security legislation, other than any Lien
imposed by ERISA;
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(f) deposits to secure the performance of bids, trade
contracts, licenses and leases (other than Indebtedness), statutory
obligations, surety bonds (other than bonds related to judgments or
litigation), performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(g) easements, rights-of-way, restrictions and other
similar encumbrances affecting real property which, in the aggregate,
are not substantial in amount, and which do not in any case materially
detract from the value of the property subject thereto or materially
interfere with the ordinary conduct of the business of the applicable
Person;
(h) Liens securing judgments for the payment of money (or
appeal or other surety bonds relating to such judgments) not in excess
of the Threshold Amount (except to the extent covered by independent
third-party insurance as to which the insurer has acknowledged in
writing its obligation to cover), unless any such judgment remains
undischarged for a period of more than thirty (30) consecutive days
during which execution is not effectively stayed;
(i) Liens securing Indebtedness permitted under Section
8.03(c); provided that (i) such Liens do not at any time encumber any
Property other than the Property financed by such Indebtedness, (ii)
the Indebtedness secured thereby does not exceed the cost or fair
market value, whichever is lower, of the Property being acquired on the
date of acquisition and (iii) such Liens attach to such Property
concurrently with or within ninety days after the acquisition thereof;
(j) leases, licenses or subleases granted to others not
interfering in any material respect with the business of the Borrower
or any Subsidiary;
(k) any interest of title of a lessor under, and Liens
arising from UCC financing statements (or equivalent filings,
registrations or agreements in foreign jurisdictions) relating to,
leases permitted by this Agreement;
(l) Liens deemed to exist in connection with Investments
in repurchase agreements permitted under Section 8.02;
(m) normal and customary rights of setoff upon deposits
of cash in favor of banks or other depository institutions;
(n) Liens of a collection bank arising under Section
4-210 of the Uniform Commercial Code on items in the course of
collection;
(o) Liens created or deemed to exist by the establishment
of trusts for the purpose of satisfying (i) Governmental Reimbursement
Program Costs and (ii) other actions or claims pertaining to the same
or related matters or other Medical Reimbursement Programs, provided
that the Borrower, in each case, shall have established adequate
reserves for such claims or actions;
(p) Liens of sellers of goods to the Borrower and any of
its Subsidiaries arising under Article 2 of the Uniform Commercial Code
or similar provisions of applicable law in the ordinary course of
business, covering only the goods sold and securing only the unpaid
purchase price for such goods and related expenses;
(q) Liens on the Property of PSI Surety created or deemed
to exist in connection with its self-insurance programs;
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(r) Liens on the Property of the HUD Financing
Subsidiaries securing the HUD Financing; and
(s) Liens on the Property (other than accounts
receivable) of Aeries Healthcare of Illinois, Inc. securing the HUD
Financing.
8.02 INVESTMENTS.
Make any Investments, except:
(a) cash or Cash Equivalents;
(b) accounts receivable and promissory notes created,
acquired or made and trade credit extended in the ordinary course of
business and payable or dischargeable in accordance with customary
trade terms;
(c) Investments consisting of stock, obligations,
securities or other property received in settlement of accounts
receivable (created in the ordinary course of business) from
financially troubled obligors
(d) Investments existing as of the Closing Date and set
forth in Schedule 8.02;
(e) Guarantees permitted by Section 8.03;
(f) Permitted Acquisitions;
(g) loans and advances to employees, directors and
officers in the ordinary course of business in the aggregate not to
exceed $750,000 in the aggregate at any time outstanding;
(h) Investments made prior to the Closing Date in any
Subsidiary;
(i) Investments by any Foreign Subsidiary in another
Foreign Subsidiary;
(j) Investments in any Person that is a Loan Party prior
to giving effect to such Investment;
(k) Investments in any Immaterial Subsidiary;
(l) Investments in PSI Surety to pay its reasonable
general corporate and overhead expenses and to cause PSI Surety to
maintain the minimum amount of capital required by applicable Laws,
provided that the aggregate amount of Investments in PSI Surety
pursuant to this clause (l) shall not exceed $2 million in any fiscal
year;
(m) Investments consisting of non-cash consideration
received in connection with a Disposition permitted under Section 8.05;
and
(n) Investments not permitted in the foregoing clauses in
an amount not to exceed $5,000,000 in the aggregate at any time
outstanding.
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8.03 INDEBTEDNESS.
Create, incur, assume or suffer to exist any Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Indebtedness of the Borrower and its Subsidiaries set
forth in Schedule 8.03 (and renewals, refinancings and extensions
thereof on terms and conditions not materially less favorable to the
applicable debtor(s));
(c) purchase money Indebtedness (including obligations in
respect of Capital Leases or Synthetic Leases) hereafter incurred by
the Borrower or any of its Subsidiaries to finance the purchase of
fixed assets, provided that (i) such Indebtedness when incurred shall
not exceed the purchase price of the asset(s) financed, (ii) no such
Indebtedness shall be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of such
refinancing and (iii) the total amount of all such Indebtedness at any
time outstanding shall not exceed $2,500,000;
(d) obligations (contingent or otherwise) of the Borrower
or any Subsidiary existing or arising under any Swap Contract, provided
that (i) such obligations are (or were) entered into by such Person in
the ordinary course of business for the purpose of directly mitigating
risks associated with liabilities, commitments, investments, assets, or
property held or reasonably anticipated by such Person, or changes in
the value of securities issued by such Person, and not for purposes of
speculation or taking a "market view;" and (ii) such Swap Contract does
not contain any provision exonerating the non-defaulting party from its
obligation to make payments on outstanding transactions to the
defaulting party;
(e) intercompany Indebtedness permitted under Section
8.02;
(f) Senior Subordinated Notes;
(g) HUD Financing existing on the Closing Date and
renewals, refinancings and extensions thereof on terms and conditions
not materially less favorable to the applicable debtor(s) (provided
that the principal amount thereof shall not be refinanced for a
principal amount in excess of the principal balance outstanding thereon
at the time of such refinancing);
(h) Earn-Out Obligations in an aggregate amount not to
exceed $10,000,000 at any one time outstanding, provided that such
Earn-Out Obligations are subordinated to the Obligations in a manner
and to an extent acceptable to the Administrative Agent;
(i) other unsecured Indebtedness in an aggregate
principal amount not to exceed $2,500,000 at any one time outstanding;
and
(j) Guarantees with respect to Indebtedness permitted
under this Section 8.03.
8.04 FUNDAMENTAL CHANGES.
Merge, dissolve, liquidate, consolidate with or into another Person, or
Dispose of (whether in one transaction or in a series of transactions) all or
substantially all of its assets (whether now owned or hereafter acquired) to or
in favor of any Person; provided that, notwithstanding the foregoing provisions
of this Section 8.04 but subject to the terms of Sections 7.12 and 7.14, (a) the
Borrower may merge or consolidate with any Subsidiary, provided that the
Borrower shall be the continuing or surviving corporation,
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(b) any Subsidiary may merge or consolidate with any other Subsidiary, provided
that (i) if a Guarantor is a party thereto, then a Guarantor shall be the
continuing or surviving corporation and (ii) if a Guarantor is not a party
thereto and a Domestic Subsidiary is a party thereto, then a Domestic Subsidiary
shall be the continuing or surviving corporation, (c) any Subsidiary may merge
with any Person that is not a Loan Party in connection with a Disposition
permitted under Section 8.05, (d) the Borrower or any Subsidiary may merge with
any Person that is not a Loan Party in connection with a Permitted Acquisition
provided that, if such transaction involves the Borrower, the Borrower shall be
the continuing or surviving corporation, and (e) any Wholly Owned Subsidiary may
dissolve, liquidate or wind up its affairs at any time provided that such
dissolution, liquidation or winding up, as applicable, could not have a Material
Adverse Effect.
8.05 DISPOSITIONS.
Make any Disposition unless:
(a) if such transaction is a Sale and Leaseback
Transaction, such transaction is not prohibited by the terms of Section
8.15;
(b) such transaction does not involve the sale or other
disposition of a minority equity interest in any Subsidiary;
(c) such transaction does not involve a sale or other
disposition of receivables other than receivables owned by or
attributable to other Property concurrently being disposed of in a
transaction otherwise permitted under this Section 8.05;
(d) no Default has occurred and is continuing;
(e) the consideration paid in connection therewith shall
be cash or Cash Equivalents received contemporaneous with the
consummation of such Disposition and shall be in an amount not less
than the fair market value of the Property disposed of; and
(f) the aggregate net book value of all of the Property
sold or otherwise disposed of by the Borrower and its Subsidiaries in
any fiscal year shall not exceed an amount equal to ten percent (10%)
of the net book value of plant, property and equipment of the Borrower
and its Subsidiaries on a consolidated basis as of the last day of the
immediately preceding fiscal year.
8.06 RESTRICTED PAYMENTS.
Declare or make, directly or indirectly, any Restricted Payment, or
incur any obligation (contingent or otherwise) to do so, except that:
(a) each Subsidiary may make Restricted Payments to the
holders of its Capital Stock;
(b) the Borrower and each Subsidiary may declare and make
dividend payments or other distributions payable solely in the Capital
Stock of the Person making such dividend or distribution;
(c) the Borrower may repurchase the Capital Stock of the
Borrower held by departing employees, former employees, directors and
former directors of the Borrower or any of its Subsidiaries in an
amount not to exceed $750,000 in the aggregate during any fiscal year
of the Borrower; and
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(d) the Borrower may repurchase all warrants to purchase
Capital Stock of the Borrower held by CapitalSource Finance LLC (or any
of its Affiliates) on the Closing Date.
8.07 CHANGE IN NATURE OF BUSINESS.
Engage in any material line of business substantially different from
those lines of business conducted by the Borrower and its Subsidiaries on the
Closing Date or any business substantially related or incidental thereto.
8.08 TRANSACTIONS WITH AFFILIATES AND INSIDERS.
Enter into or permit to exist any transaction or series of transactions
with any officer, director or Affiliate of such Person other than (a)
transactions between Loan Parties, (b) intercompany transactions expressly
permitted by Section 7.07, Section 8.02, Section 8.03, Section 8.04, Section
8.05 or Section 8.06, (c) reasonable compensation and reimbursement of expenses
of, and indemnification of, officers and directors, (d) transactions pursuant to
the Stock Purchase Agreement dated as of January 6, 2003 among the Borrower and
the purchasers identified therein (the "Series A Purchasers") and the
Registration Rights Agreement dated January 6, 2003 among the Borrower and the
Series A Purchasers, in each case otherwise complying with this Agreement and
(e) except as otherwise specifically limited in this Agreement, other
transactions which are entered into in the ordinary course of such Person's
business on terms and conditions substantially as favorable to such Person as
would be obtainable by it in a comparable arms-length transaction with a Person
other than an officer, director or Affiliate.
8.09 BURDENSOME AGREEMENTS.
Enter into or permit to exist any Contractual Obligation that encumbers
or restricts the ability of the Borrower or any Subsidiary (other than any
Excluded Subsidiary) to (a) pay dividends or make any other distributions to any
Loan Party on its Capital Stock or with respect to any other interest or
participation in, or measured by, its profits, (b) pay any Indebtedness or other
obligation owed to any Loan Party, (c) make loans or advances to any Loan Party,
(d) sell, lease or transfer any of its Property to any Loan Party, (e) grant any
Lien on any of its Property to secure the Obligations pursuant to the Loan
Documents or any renewals, refinancings, exchanges, refundings or extension
thereof or (f) act as a Loan Party pursuant to the Loan Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (a) through (e) above) for
(i) this Agreement and the other Loan Documents, (ii) any document or instrument
governing Indebtedness incurred pursuant to Section 8.03(c), provided that any
such restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith, (iii) any Permitted Lien or any
document or instrument governing any Permitted Lien, provided that any such
restriction contained therein relates only to the asset or assets subject to
such Permitted Lien, (iv) customary restrictions and conditions contained in any
agreement relating to the sale of any Property permitted under Section 8.05
pending the consummation of such sale, (v) any document or instrument governing
Subordinated Indebtedness and (vi) in the case of the matters referred to in
clause (a) through (d) above, Contractual Obligations of any Person that becomes
a Subsidiary after the Closing Date, provided that such Contractual Obligations
were in existence at the time such Person became a Subsidiary and were not
created in contemplation of or in connection with such Person becoming a
Subsidiary.
8.10 USE OF PROCEEDS.
Use the proceeds of any Credit Extension, whether directly or
indirectly, and whether immediately, incidentally or ultimately, to purchase or
carry margin stock (within the meaning
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of Regulation U of the FRB) or to extend credit to others for the purpose of
purchasing or carrying margin stock or to refund indebtedness originally
incurred for such purpose.
8.11 FINANCIAL COVENANTS.
(a) Consolidated Total Leverage Ratio. Permit the Consolidated
Total Leverage Ratio as of the end of any fiscal quarter of the Borrower to be
greater than 4.0:1.0.
(b) Consolidated Senior Leverage Ratio. Permit the Consolidated
Senior Leverage Ratio as of the end of any fiscal quarter of the Borrower to be
greater than 2.0:1.0.
(c) Consolidated Fixed Charges Coverage Ratio. Permit the
Consolidated Fixed Charges Coverage Ratio as of the end of any fiscal quarter of
the Borrower set forth below to be less than the ratio opposite such fiscal
quarter:
Fiscal Quarter End Minimum Ratio
------------------------------ -------------
March 31, 2004 1.15:1.0
June 30, 2004 1.15:1.0
September 30, 2004 1.15:1.0
December 31, 2004 1.15:1.0
March 31, 2005 1.20:1.0
June 30, 2005 1.20:1.0
September 30, 2005 1.20:1.0
December 31, 2005 1.20:1.0
March 31, 2006 and each fiscal
quarter ending thereafter 1.25:1.0
(d) Consolidated Net Worth. Permit Consolidated Net Worth at any
time to be less than the sum of an amount equal to (i) $72 million, increased on
a cumulative basis as of the end of each fiscal quarter of the Borrower,
commencing with the fiscal quarter ending March 31, 2004 by an amount equal to
75% of Consolidated Net Income (to the extent positive) for the fiscal quarter
then ended plus (ii) 100% of the proceeds of all equity issuances after the
Closing Date.
(e) Consolidated Growth Capital Expenditures. Permit Consolidated
Growth Capital Expenditures in an aggregate amount in excess of $10 million
during the term of this Agreement.
8.12 PREPAYMENT OF OTHER INDEBTEDNESS, ETC.
(a) Amend or modify any of the terms of any Subordinated
Indebtedness of the Borrower or any Subsidiary if such amendment or modification
would add or change any terms in a manner adverse to the Borrower or any
Subsidiary (including any amendment or modification that would shorten the final
maturity or average life to maturity or require any payment to be made sooner
than originally scheduled or increase the interest rate applicable thereto).
(b) Amend or modify any of the subordination provisions of any
Subordinated Indebtedness.
(c) Make (or give any notice with respect thereto) any principal
payment (including any prepayment, whether optional or mandatory) on, or redeem,
acquire for value (including without
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limitation, by way of depositing money or securities with the trustee with
respect thereto before due for the purpose of paying when due), refund,
refinance or exchange, any Subordinated Indebtedness.
8.13 ORGANIZATION DOCUMENTS; FISCAL YEAR; LEGAL NAME, STATE OF FORMATION AND
FORM OF ENTITY.
(a) Amend, modify or change its Organization Documents in a manner
adverse to the Lenders.
(b) Change its fiscal year.
(c) Without providing twenty (20) days prior written notice to the
Administrative Agent, change its name, state of formation or form of
organization.
8.14 OWNERSHIP OF SUBSIDIARIES.
Notwithstanding any other provisions of this Agreement to the contrary,
(i) permit any Person (other than the Borrower or any Wholly Owned Subsidiary)
to own any Capital Stock of any Subsidiary, except to qualify directors where
required by applicable law or to satisfy other requirements of applicable law
with respect to the ownership of Capital Stock of Foreign Subsidiaries, (ii)
permit any Subsidiary to issue or have outstanding any shares of preferred
Capital Stock or (iii) create, incur, assume or suffer to exist any Lien on any
Capital Stock of any Subsidiary, except for Permitted Liens.
8.15 SALE AND LEASEBACK TRANSACTIONS.
Enter into any Sale and Leaseback Transaction.
ARTICLE IX
EVENTS OF DEFAULT AND REMEDIES
9.01 EVENTS OF DEFAULT.
Any of the following shall constitute an Event of Default:
(a) Non-Payment. The Borrower or any other Loan Party
fails to pay (i) when and as required to be paid herein, any amount of
principal of any Loan or any L/C Obligation, or (ii) within three days
after the same becomes due, any interest on any Loan or on any L/C
Obligation, or any commitment fee, utilization fee or other fee due
hereunder, or (iii) within five days after the same becomes due, any
other amount payable hereunder or under any other Loan Document; or
(b) Specific Covenants.
(i) Any Loan Party fails to perform or observe
any term, covenant or agreement contained in any of Section
7.01, 7.02 or 7.03 and such failure continues for five
Business Days; or
(ii) Any Loan Party fails to perform or observe
any term, covenant or agreement contained in any of Section
7.05(a), 7.10, 7.11, 7.12, or Article VIII; or
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(c) Other Defaults. Any Loan Party fails to perform or
observe any other covenant or agreement (not specified in subsection
(a) or (b) above) contained in any Loan Document on its part to be
performed or observed and such failure continues for thirty days after
the earlier of (i) a Responsible Person of any Loan Party becoming
aware of such failure or (ii) notice thereof to any Loan Party by the
Administrative Agent; or
(d) Representations and Warranties. Any representation,
warranty, certification or statement of fact made or deemed made by or
on behalf of the Borrower or any other Loan Party herein, in any other
Loan Document, or in any document delivered in connection herewith or
therewith shall be incorrect or misleading in any material respect when
made or deemed made; or
(e) Cross-Default. (i) The Borrower or any Subsidiary
fails to make any payment when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise) in respect of
any Indebtedness or Guarantee (other than Indebtedness hereunder and
Indebtedness under Swap Contracts) having an aggregate principal amount
(including undrawn committed or available amounts and including amounts
owing to all creditors under any combined or syndicated credit
arrangement) of more than the Threshold Amount; (ii) the Borrower or
any Subsidiary fails to observe or perform any other agreement or
condition relating to any such Indebtedness or Guarantee or contained
in any instrument or agreement evidencing, securing or relating
thereto, or any other event occurs, the effect of which default or
other event is to cause, or to permit the holder or holders of such
Indebtedness or the beneficiary or beneficiaries of such Guarantee (or
a trustee or agent on behalf of such holder or holders or beneficiary
or beneficiaries) to cause, with the giving of notice if required, such
Indebtedness to be demanded or to become due or to be repurchased,
prepaid, defeased or redeemed (automatically or otherwise), or an offer
to repurchase, prepay, defease or redeem such Indebtedness to be made,
prior to its stated maturity, or such Guarantee to become payable or
cash collateral in respect thereof to be demanded; or (iii) there
occurs under any Swap Contract an Early Termination Date (as defined in
such Swap Contract) resulting from (A) any event of default under such
Swap Contract as to which the Borrower or any Subsidiary is the
Defaulting Party (as defined in such Swap Contract) or (B) any
Termination Event (as so defined) under such Swap Contract as to which
the Borrower or any Subsidiary is an Affected Party (as so defined)
and, in either event, the Swap Termination Value owed by the Borrower
or such Subsidiary as a result thereof is greater than the Threshold
Amount; or
(f) Insolvency Proceedings, Etc. Any Loan Party or any of
its Subsidiaries institutes or consents to the institution of any
proceeding under any Debtor Relief Law, or makes an assignment for the
benefit of creditors; or applies for or consents to the appointment of
any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part
of its Property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of such Person and the appointment continues
undischarged or unstayed for sixty calendar days; or any proceeding
under any Debtor Relief Law relating to any such Person or to all or
any material part of its Property is instituted without the consent of
such Person and continues undismissed or unstayed for sixty calendar
days, or an order for relief is entered in any such proceeding; or
(g) Inability to Pay Debts; Attachment. (i) The Borrower
or any Subsidiary becomes unable or admits in writing its inability or
fails generally to pay its debts as they become due, or (ii) any writ
or warrant of attachment or execution or similar process is issued or
levied against all or any material part of the Property of any such
Person and is not released, vacated or fully bonded within thirty days
after its issue or levy; or
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(h) Judgments. There is entered against the Borrower or
any Subsidiary (i) one or more final judgments or orders for the
payment of money in an aggregate amount exceeding the Threshold Amount
(to the extent not covered by independent third-party insurance as to
which the insurer has acknowledged in writing its obligation to cover),
or (ii) any one or more non-monetary final judgments that have, or
could reasonably be expected to have, individually or in the aggregate,
a Material Adverse Effect and, in either case, (A) enforcement
proceedings are commenced by any creditor upon such judgment or order,
or (B) there is a period of ten (10) consecutive days during which a
stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a
Pension Plan or Multiemployer Plan which has resulted or could
reasonably be expected to result in liability of the Borrower under
Title IV of ERISA to the Pension Plan, Multiemployer Plan or the PBGC
in an aggregate amount in excess of the Threshold Amount, or (ii) the
Borrower or any ERISA Affiliate fails to pay when due, after the
expiration of any applicable grace period, any installment payment with
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of the Threshold
Amount; or
(j) Invalidity of Loan Documents. Any Loan Document, at
any time after its execution and delivery and for any reason other than
as expressly permitted hereunder or satisfaction in full of all the
Obligations, ceases to be in full force and effect or ceases to give
the Administrative Agent, for the benefit of the Lenders, any material
part of the Liens purported to be created thereby; or any Loan Party or
any other Person contests in any manner the validity or enforceability
of any Loan Document; or any Loan Party denies that it has any or
further liability or obligation under any Loan Document, or purports to
revoke, terminate or rescind any Loan Document; or
(k) Change of Control. There occurs any Change of
Control; or
(l) Senior Subordinated Notes. (i) There shall occur an
"Event of Default" (or any comparable term) under, and as defined in,
any of the Senior Subordinated Notes Documents, (ii) any of the
Obligations for any reason shall cease to be "Senior Debt" (or any
comparable term) under, and as defined in, the Senior Subordinated
Notes Documents, (iii) any Indebtedness other than the Obligations
shall constitute "Designated Senior Debt" (or any comparable term)
under, and as defined in, the Senior Subordinated Notes Documents or
(iv) the subordination provisions of any of the Senior Subordinated
Notes Documents shall, in whole or in part, terminate, cease to be
effective or cease to be legally valid, binding and enforceable against
any holder of the Senior Subordinated Notes; or
(m) Exclusion Event. There shall occur an Exclusion Event
that could reasonably be expected to result in a Material Adverse
Effect.
9.02 REMEDIES UPON EVENT OF DEFAULT.
If any Event of Default occurs and is continuing, the Administrative
Agent shall, at the request of, or may, with the consent of, the Required
Lenders, take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans
and any obligation of the L/C Issuer to make L/C Credit Extensions to
be terminated, whereupon such commitments and obligation shall be
terminated;
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(b) declare the unpaid principal amount of all
outstanding Loans, all interest accrued and unpaid thereon, and all
other amounts owing or payable hereunder or under any other Loan
Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby
expressly waived by the Borrower;
(c) require that the Borrower Cash Collateralize the L/C
Obligations (in an amount equal to the then Outstanding Amount
thereof); and
(d) exercise on behalf of itself and the Lenders all
rights and remedies available to it and the Lenders under the Loan
Documents or applicable law;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans and any obligation of
the L/C Issuer to make L/C Credit Extensions shall automatically terminate, the
unpaid principal amount of all outstanding Loans and all interest and other
amounts as aforesaid shall automatically become due and payable, and the
obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further act
of the Administrative Agent or any Lender.
9.03 APPLICATION OF FUNDS.
After the exercise of remedies provided for in Section 9.02 (or after
the Loans have automatically become immediately due and payable and the L/C
Obligations have automatically been required to be Cash Collateralized as set
forth in the proviso to Section 9.02), any amounts received on account of the
Obligations shall be applied by the Administrative Agent in the following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and
amounts payable under Article III) payable to the Administrative Agent
in its capacity as such;
Second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest)
payable to the Lenders (including Attorney Costs and amounts payable
under Article III), ratably among them in proportion to the amounts
described in this clause Second payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans and L/C Borrowings, fees,
premiums and scheduled periodic payments, and any interest accrued
thereon, due under any Swap Contract between any Loan Party and any
Lender, or any Affiliate of a Lender, to the extent such Swap Contract
is permitted by Section 8.03(d), ratably among the Lenders (and, in the
case of such Swap Contracts, Affiliates of Lenders) in proportion to
the respective amounts described in this clause Third held by them;
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans and L/C Borrowings, breakage, termination
or other payments, and any interest accrued thereon, due under any Swap
Contract between any Loan Party and any Lender, or any Affiliate of a
Lender, to the extent such Swap Contract is permitted by Section
8.03(d), and amounts due under any Treasury Management Agreement
between any Loan Party and any Lender, or any Affiliate of a Lender,
and to Cash Collateralize that portion of L/C Obligations comprised of
the aggregate undrawn amount of Letters of Credit, ratably among the
Lenders (and, in the case of such Swap Contracts and Treasury
Management Agreements, Affiliates of Lenders) in proportion to the
respective amounts described in this clause Fourth held by them; and
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Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by
Law.
Subject to Section 2.03(c), amounts used to Cash Collateralize the aggregate
undrawn amount of Letters of Credit pursuant to clause Fourth above shall be
applied to satisfy drawings under such Letters of Credit as they occur. If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.
ARTICLE X
ADMINISTRATIVE AGENT
10.01 APPOINTMENT AND AUTHORIZATION OF ADMINISTRATIVE AGENT.
(a) Each Lender hereby irrevocably appoints, designates and
authorizes the Administrative Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Administrative
Agent shall not have any duties or responsibilities, except those expressly set
forth herein, nor shall the Administrative Agent have or be deemed to have any
fiduciary relationship with any Lender or participant, and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement or any other Loan Document or otherwise exist against the
Administrative Agent. Without limiting the generality of the foregoing sentence,
the use of the term "agent" herein and in the other Loan Documents with
reference to the Administrative Agent is not intended to connote any fiduciary
or other implied (or express) obligations arising under agency doctrine of any
applicable Law. Instead, such term is used merely as a matter of market custom,
and is intended to create or reflect only an administrative relationship between
independent contracting parties.
(b) The L/C Issuer shall act on behalf of the Lenders with respect
to any Letters of Credit issued by it and the documents associated therewith,
and the L/C Issuer shall have all of the benefits and immunities (i) provided to
the Administrative Agent in this Article X with respect to any acts taken or
omissions suffered by the L/C Issuer in connection with Letters of Credit issued
by it or proposed to be issued by it and the applications and agreements for
letters of credit pertaining to such Letters of Credit as fully as if the term
"Administrative Agent" as used in this Article X and in the definition of
"Agent-Related Person" included the L/C Issuer with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the L/C
Issuer.
10.02 DELEGATION OF DUTIES.
The Administrative Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other
consultants or experts concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects in the absence of gross
negligence or willful misconduct.
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10.03 LIABILITY OF ADMINISTRATIVE AGENT.
No Agent-Related Person shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Agreement or
any other Loan Document or the transactions contemplated hereby (except for its
own gross negligence or willful misconduct in connection with its duties
expressly set forth herein), or (b) be responsible in any manner to any Lender
or participant for any recital, statement, representation or warranty made by
any Loan Party or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of any Loan Party or any other party
to any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
any Affiliate thereof.
10.04 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall
be fully protected in relying, upon any writing, communication, signature,
resolution, representation, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, electronic mail message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to any Loan
Party), independent accountants and other experts selected by the Administrative
Agent. The Administrative Agent shall be fully justified in failing or refusing
to take any action under any Loan Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate and, if it
so requests, it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement or any other Loan Document in accordance with a request or
consent of the Required Lenders (or such greater number of Lenders as may be
expressly required hereby in any instance) and such request and any action taken
or failure to act pursuant thereto shall be binding upon all the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 5.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter required thereunder to be consented to or approved by
or acceptable or satisfactory to a Lender unless the Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
10.05 NOTICE OF DEFAULT.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of any Default, except with respect to defaults in the
payment of principal, interest and fees required to be paid to the
Administrative Agent for the account of the Lenders, unless the Administrative
Agent shall have received written notice from a Lender or the Borrower referring
to this Agreement, describing such Default and stating that such notice is a
"notice of default." The Administrative Agent will notify the Lenders of its
receipt of any such notice. The Administrative Agent shall take such action with
respect to such Default as may be directed by the Required Lenders in accordance
with Article IX; provided, however, that unless and until the Administrative
Agent has received any such direction, the
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Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default as it shall deem
advisable or in the best interest of the Lenders.
10.06 CREDIT DECISION; DISCLOSURE OF INFORMATION BY ADMINISTRATIVE AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Administrative Agent
hereafter taken, including any consent to and acceptance of any assignment or
review of the affairs of any Loan Party or any Affiliate thereof, shall be
deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have
disclosed material information in their possession. Each Lender represents to
the Administrative Agent that it has, independently and without reliance upon
any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their respective Subsidiaries, and all
applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to the Borrower and the other Loan Parties hereunder. Each
Lender also represents that it will, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Borrower and the other Loan
Parties. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent herein, the
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of any
of the Loan Parties or any of their respective Affiliates which may come into
the possession of any Agent-Related Person.
10.07 INDEMNIFICATION OF ADMINISTRATIVE AGENT.
Whether or not the transactions contemplated hereby are consummated,
the Lenders shall indemnify upon demand each Agent-Related Person (to the extent
not reimbursed by or on behalf of any Loan Party and without limiting the
obligation of any Loan Party to do so), pro rata, and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the
payment to any Agent-Related Person of any portion of such Indemnified
Liabilities to the extent determined in a final, nonappealable judgment by a
court of competent jurisdiction to have resulted from such Agent-Related
Person's own gross negligence or willful misconduct; provided, however, that no
action taken in accordance with the directions of the Required Lenders shall be
deemed to constitute gross negligence or willful misconduct for purposes of this
Section. Without limitation of the foregoing, each Lender shall reimburse the
Administrative Agent upon demand for its ratable share of any costs or
out-of-pocket expenses (including Attorney Costs) incurred by the Administrative
Agent in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal
proceedings or otherwise) of, or legal advice in respect of rights or
responsibilities under, this Agreement, any other Loan Document, or any document
contemplated by or referred to herein, to the extent that the Administrative
Agent is not reimbursed for such expenses by or on behalf of the Borrower. The
undertaking in this Section shall survive termination of the Aggregate Revolving
Commitments, the payment of all Obligations and the resignation of the
Administrative Agent.
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10.08 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY.
Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Loan Parties and their respective Affiliates
as though Bank of America were not the Administrative Agent or the L/C Issuer
hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, Bank of America or its Affiliates
may receive information regarding any Loan Party or its Affiliates (including
information that may be subject to confidentiality obligations in favor of such
Loan Party or such Affiliate) and acknowledge that the Administrative Agent
shall be under no obligation to provide such information to them. With respect
to its Loans, Bank of America shall have the same rights and powers under this
Agreement as any other Lender and may exercise such rights and powers as though
it were not the Administrative Agent or the L/C Issuer, and the terms "Lender"
and "Lenders" include Bank of America in its individual capacity.
10.09 SUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign as Administrative Agent upon thirty
days' notice to the Lenders; provided that any such resignation by Bank of
America shall also constitute its resignation as L/C Issuer and Swing Line
Lender. If the Administrative Agent resigns under this Agreement, the Required
Lenders shall appoint from among the Lenders a successor administrative agent
for the Lenders, which successor administrative agent shall be consented to by
the Borrower at all times other than during the existence of an Event of Default
(which consent of the Borrower shall not be unreasonably withheld or delayed).
If no successor administrative agent is appointed prior to the effective date of
the resignation of the Administrative Agent, the Administrative Agent may
appoint, after consulting with the Lenders and the Borrower, a successor
administrative agent from among the Lenders. Upon the acceptance of its
appointment as successor administrative agent hereunder, the Person acting as
such successor administrative agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent, L/C Issuer and Swing Line Lender
and the respective terms "Administrative Agent", "L/C Issuer" and "Swing Line
Lender" shall mean such successor administrative agent, Letter of Credit issuer
and swing line lender, and the retiring Administrative Agent's appointment,
powers and duties as Administrative Agent shall be terminated and the retiring
L/C Issuer's and Swing Line Lender's rights, powers and duties as such shall be
terminated, without any other or further act or deed on the part of such
retiring L/C Issuer or Swing Line Lender or any other Lender, other than the
obligation of the successor L/C Issuer to issue letters of credit in
substitution for the Letters of Credit, if any, outstanding at the time of such
succession or to make other arrangements satisfactory to the retiring L/C Issuer
to effectively assume the obligations of the retiring L/C Issuer with respect to
such Letters of Credit. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article X and Sections
11.04 and 11.05 shall inure to its benefit as to any actions taken or omitted to
be taken by it while it was Administrative Agent under this Agreement. If no
successor administrative agent has accepted appointment as Administrative Agent
by the date thirty days following a retiring Administrative Agent's notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
thereupon become effective and the Lenders shall perform all of the duties of
the Administrative Agent hereunder until such time, if any, as the Required
Lenders appoint a successor agent as provided for above.
10.10 ADMINISTRATIVE AGENT MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to any Loan Party, the Administrative Agent
(irrespective of whether the principal of any Loan or L/C Obligation shall then
be due and payable as herein expressed or by declaration or otherwise and
irrespective of whether the
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Administrative Agent shall have made any demand on the Borrower) shall be
entitled and empowered, by intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loans, L/C
Obligations and all other Obligations that are owing and unpaid and to
file such other documents as may be necessary or advisable in order to
have the claims of the Lenders and the Administrative Agent (including
any claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders and
the Administrative Agent under Sections 2.03(i) and (j), 2.09 and
11.04) allowed in such judicial proceeding; and
(b) to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments
directly to the Lenders, to pay to the Administrative Agent any amount due for
the reasonable compensation, expenses, disbursements and advances of the
Administrative Agent and its agents and counsel, and any other amounts due the
Administrative Agent under Sections 2.09 and 11.04.
Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization, arrangement, adjustment or composition
affecting the Obligations or the rights of any Lender or to authorize the
Administrative Agent to vote in respect of the claim of any Lender in any such
proceeding.
10.11 COLLATERAL AND GUARANTY MATTERS.
The Lenders irrevocably authorize the Administrative Agent, at its
option and in its discretion,
(a) to release any Lien on any Collateral granted to or
held by the Administrative Agent under any Loan Document (i) upon
termination of the Aggregate Revolving Commitments and payment in full
of all Obligations (other than contingent indemnification obligations)
and the expiration or termination of all Letters of Credit, (ii) that
is transferred or to be transferred as part of or in connection with
any Disposition permitted hereunder or under any other Loan Document or
any Involuntary Disposition, or (iii) as approved in accordance with
Section 11.01; and
(b) to release any Guarantor from its obligations under
the Guaranty if such Person ceases to be a Subsidiary as a result of a
transaction permitted hereunder.
Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent's authority to
release or subordinate its interest in particular types or items of
Property, or to release any Guarantor from its obligations under the
Guaranty, pursuant to this Section 10.11.
10.12 OTHER AGENTS; ARRANGERS AND MANAGERS.
None of the Lenders or other Persons identified on the facing page or
signature pages of this Agreement as a "syndication agent," "documentation
agent," "co-agent," "book manager," "lead
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manager," "arranger," "lead arranger" or "co-arranger" shall have any right,
power, obligation, liability, responsibility or duty under this Agreement other
than, in the case of such Lenders, those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders or other Persons so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders or other Persons so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.
ARTICLE XI
MISCELLANEOUS
11.01 AMENDMENTS, ETC.
No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower or any other Loan
Party therefrom, shall be effective unless in writing signed by the Required
Lenders and the Borrower or the applicable Loan Party, as the case may be, and
acknowledged by the Administrative Agent, and each such waiver or consent shall
be effective only in the specific instance and for the specific purpose for
which given; provided, however, that no such amendment, waiver or consent shall:
(a) extend or increase the Revolving Commitment of any
Lender (or reinstate any Revolving Commitment terminated pursuant to
Section 9.02) without the written consent of such Lender (it being
understood and agreed that a waiver of any condition precedent set
forth in Section 5.02 or of any Default or Event of Default or a
mandatory reduction in Revolving Commitments is not considered an
extension or increase in Revolving Commitments of any Lender);
(b) postpone any date fixed by this Agreement or any
other Loan Document for any payment of principal (excluding mandatory
prepayments), interest, fees or other amounts due to the Lenders (or
any of them) hereunder or under any other Loan Document without the
written consent of each Lender directly affected thereby;
(c) reduce the principal of, or the rate of interest
specified herein on, any Loan or L/C Borrowing, or any fees or other
amounts payable hereunder or under any other Loan Document without the
written consent of each Lender directly affected thereby; provided,
however, that only the consent of the Required Lenders shall be
necessary to amend the definition of "Default Rate" or to waive any
obligation of the Borrower to pay interest at the Default Rate;
(d) change Section 2.13 or Section 9.03 in a manner that
would alter the pro rata sharing of payments required thereby without
the written consent of each Lender directly affected thereby;
(e) change any provision of this Section or the
definition of "Required Lenders" or any other provision hereof
specifying the number or percentage of Lenders required to amend, waive
or otherwise modify any rights hereunder or make any determination or
grant any consent hereunder without the written consent of each Lender
directly affected thereby;
(f) except in connection with a Disposition permitted
under Section 8.05, release all or substantially all of the Collateral
without the written consent of each Lender directly affected thereby;
or
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(g) release the Borrower or, except in connection with a
merger or consolidation permitted under Section 8.04 or a Disposition
permitted under Section 8.05, all or substantially all of the
Guarantors, from its or their obligations under the Loan Documents
without the written consent of each Lender directly affected thereby;
and, provided further, that (i) no amendment, waiver or consent shall, unless in
writing and signed by the L/C Issuer in addition to the Lenders required above,
affect the rights or duties of the L/C Issuer under this Agreement or any Letter
of Credit Application relating to any Letter of Credit issued or to be issued by
it; (ii) no amendment, waiver or consent shall, unless in writing and signed by
the Swing Line Lender in addition to the Lenders required above, affect the
rights or duties of the Swing Line Lender under this Agreement; (iii) no
amendment, waiver or consent shall, unless in writing and signed by the
Administrative Agent in addition to the Lenders required above, affect the
rights or duties of the Administrative Agent under this Agreement or any other
Loan Document; and (iv) the Fee Letter may be amended, or rights or privileges
thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Revolving Commitment of such Lender may not be increased or
extended without the consent of such Lender.
Notwithstanding the fact that the consent of all the Lenders is required in
certain circumstances as set forth above, (x) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code supersedes the unanimous consent provisions set forth herein
and (y) the Required Lenders shall determine whether or not to allow a Loan
Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding and such determination shall be binding on all of the Lenders.
11.02 NOTICES AND OTHER COMMUNICATIONS; FACSIMILE COPIES.
(a) General. Unless otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). All such written notices shall be mailed,
faxed or delivered to the applicable address, facsimile number or (subject to
subsection (c) below) electronic mail address, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be
made to the applicable telephone number, as follows:
(i) if to the Borrower, the Administrative Agent, the L/C
Issuer or the Swing Line Lender, to the address, facsimile number,
electronic mail address or telephone number specified for such Person
on Schedule 11.02 or to such other address, facsimile number,
electronic mail address or telephone number as shall be designated by
such party in a notice to the other parties; and
(ii) if to any other Lender, to the address, facsimile
number, electronic mail address or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile
number, electronic mail address or telephone number as shall be
designated by such party in a notice to the Borrower, the
Administrative Agent, the L/C Issuer and the Swing Line Lender.
All such notices and other communications shall be deemed to be given
or made upon the earlier to occur of (i) actual receipt by the relevant party
hereto and (ii) (A) if delivered by hand or by courier, when signed for by or on
behalf of the relevant party hereto; (B) if delivered by mail, four Business
Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile,
when sent and receipt has been confirmed by telephone; and (D) if delivered by
electronic mail (which form of delivery is subject to the
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provisions of subsection (c) below), when delivered; provided, however, that
notices and other communications to the Administrative Agent, the L/C Issuer and
the Swing Line Lender pursuant to Article II shall not be effective until
actually received by such Person. In no event shall a voicemail message be
effective as a notice, communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan
Documents may be transmitted and/or signed by facsimile. The effectiveness of
any such documents and signatures shall, subject to applicable Law, have the
same force and effect as manually signed originals and shall be binding on all
Loan Parties, the Administrative Agent and the Lenders. The Administrative Agent
may also require that any such documents and signatures be confirmed by a
manually signed original thereof; provided, however, that the failure to request
or deliver the same shall not limit the effectiveness of any facsimile document
or signature.
(c) Limited Use of Electronic Mail. Electronic mail and internet
and intranet websites may be used only to distribute routine communications,
such as financial statements and other information as provided in Section 7.02,
and to distribute Loan Documents for execution by the parties thereto, and may
not be used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. The
Administrative Agent and the Lenders shall be entitled to rely and act upon any
notices (including telephonic Loan Notices and Swing Line Loan Notices)
purportedly given by or on behalf of the Borrower even if (i) such notices were
not made in a manner specified herein, were incomplete or were not preceded or
followed by any other form of notice specified herein, or (ii) the terms
thereof, as understood by the recipient, varied from any confirmation thereof.
The Borrower shall indemnify each Agent-Related Person and each Lender from all
losses, costs, expenses and liabilities resulting from the reliance by such
Person on each notice purportedly given by or on behalf of the Borrower. All
telephonic notices to and other communications with the Administrative Agent may
be recorded by the Administrative Agent, and each of the parties hereto hereby
consents to such recording.
11.03 NO WAIVER; CUMULATIVE REMEDIES.
No failure by any Lender or the Administrative Agent to exercise, and
no delay by any such Person in exercising, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
11.04 ATTORNEY COSTS, EXPENSES AND TAXES.
The Borrower agrees (a) to pay or reimburse the Administrative Agent
for all costs and expenses incurred in connection with the development,
preparation, negotiation and execution of this Agreement and the other Loan
Documents and any amendment, waiver, consent or other modification of the
provisions hereof and thereof (whether or not the transactions contemplated
hereby or thereby are consummated), and the consummation and administration of
the transactions contemplated hereby and thereby, including all Attorney Costs
and costs and expenses in connection with the use of Intralinks, Inc. or other
similar information transmission systems in connection with this Agreement, and
(b) to pay or reimburse the Administrative Agent and each Lender for all costs
and expenses incurred in connection with the enforcement, attempted enforcement,
or preservation of any rights or remedies under this Agreement or the other Loan
Documents (including all such costs and expenses incurred during any "workout"
or restructuring in respect of the Obligations and during any legal proceeding,
including any
86
proceeding under any Debtor Relief Law), including all Attorney Costs. The
foregoing costs and expenses shall include all search, filing, recording, title
insurance and appraisal charges and fees and taxes related thereto, and other
out-of-pocket expenses incurred by the Administrative Agent and the cost of
independent public accountants and other outside experts retained by the
Administrative Agent or any Lender. All amounts due under this Section 11.04
shall be payable within ten Business Days after demand therefor. The agreements
in this Section shall survive the termination of the Aggregate Revolving
Commitments and repayment of all Obligations.
11.05 INDEMNIFICATION BY THE BORROWER.
Whether or not the transactions contemplated hereby are consummated,
the Borrower agrees to indemnify and hold harmless each Agent-Related Person,
each Lender and their respective Affiliates, directors, officers, employees,
counsel, trustees, advisors, agents and attorneys-in-fact (collectively the
"Indemnitees") from and against any and all liabilities, obligations, losses,
damages, penalties, claims, demands, actions, judgments, suits, costs, expenses
and disbursements (including Attorney Costs) of any kind or nature whatsoever
which may at any time be imposed on, incurred by or asserted against any such
Indemnitee in any way relating to or arising out of or in connection with (a)
the execution, delivery, enforcement, performance or administration of any Loan
Document or any other agreement, letter or instrument delivered in connection
with the transactions contemplated thereby or the consummation of the
transactions contemplated thereby, (b) any Revolving Commitment, Loan or Letter
of Credit or the use or proposed use of the proceeds therefrom (including any
refusal by the L/C Issuer to honor a demand for payment under a Letter of Credit
if the documents presented in connection with such demand do not strictly comply
with the terms of such Letter of Credit), (c) any actual or alleged presence or
release of Hazardous Materials on or from any property currently or formerly
owned or operated by the Borrower, any Subsidiary or any other Loan Party, or
any Environmental Liability related in any way to the Borrower, any Subsidiary
or any other Loan Party, or (d) any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory (including any investigation of, preparation
for, or defense of any pending or threatened claim, investigation, litigation or
proceeding) and regardless of whether any Indemnitee is a party thereto (all the
foregoing, collectively, the "Indemnified Liabilities"); provided that such
indemnity shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses or disbursements are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee. No Indemnitee
shall be liable for any damages arising from the use by others of any
information or other materials obtained through IntraLinks or other similar
information transmission systems in connection with this Agreement, nor shall
any Indemnitee have any liability for any indirect or consequential damages
relating to this Agreement or any other Loan Document or arising out of its
activities in connection herewith or therewith (whether before or after the
Closing Date). All amounts due under this Section 11.05 shall be payable within
ten Business Days after demand therefor. The agreements in this Section shall
survive the resignation of the Administrative Agent, the replacement of any
Lender, the termination of the Aggregate Revolving Commitments and the
repayment, satisfaction or discharge of all the Obligations.
11.06 PAYMENTS SET ASIDE.
To the extent that any payment by or on behalf of any Loan Party is
made to the Administrative Agent or any Lender, or the Administrative Agent or
any Lender exercises its right of set-off, and such payment or the proceeds of
such set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent
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of such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such set-off had not occurred, and (b) each Lender
severally agrees to pay to the Administrative Agent upon demand its applicable
share of any amount so recovered from or repaid by the Administrative Agent,
plus interest thereon from the date of such demand to the date such payment is
made at a rate per annum equal to the Federal Funds Rate from time to time in
effect.
11.07 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 permitted hereby, except that the Borrower may not assign or otherwise
transfer any of its rights or obligations hereunder without the prior written
consent of each Lender and no Lender may assign or otherwise transfer any of its
rights or obligations hereunder except (i) to an Eligible Assignee in accordance
with the provisions of subsection (b) of this Section, (ii) by way of
participation in accordance with the provisions of subsection (d) of this
Section or (iii) by way of pledge or assignment of a security interest subject
to the restrictions of subsection (f) of this Section (and any other attempted
assignment or transfer by any party hereto shall be null and void). Nothing in
this Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and assigns
permitted hereby, Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Indemnitees) any
legal or equitable right, remedy or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible
Assignees all or a portion of its rights and obligations under this Agreement
(including all or a portion of its Revolving Commitment and the Loans (including
for purposes of this subsection (b), participations in L/C Obligations and in
Swing Line Loans) at the time owing to it); provided that (i) except in the case
of an assignment of the entire remaining amount of the assigning Lender's
Revolving Commitment and the Loans at the time owing to it or in the case of an
assignment to a Lender or an Affiliate of a Lender or an Approved Fund with
respect to a Lender, the aggregate amount of the Revolving Commitment (which for
this purpose includes Loans outstanding thereunder) subject to each such
assignment, determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Administrative Agent or, if "Trade Date"
is specified in the Assignment and Assumption, as of the Trade Date, shall not
be less than $5,000,000 unless each of the Administrative Agent and, so long as
no Event of Default has occurred and is continuing, the Borrower otherwise
consents (each such consent not to be unreasonably withheld or delayed); (ii)
each partial assignment shall be made as an assignment of a proportionate part
of all the assigning Lender's rights and obligations under this Agreement with
respect to the Loans or the Revolving Commitment assigned, except that this
clause (ii) shall not apply to rights in respect of Swing Line Loans; and (iii)
the parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation
fee of $3,500. Subject to acceptance and recording thereof by the Administrative
Agent pursuant to subsection (c) of this Section, from and after the effective
date specified in each Assignment and Assumption, the Eligible Assignee
thereunder shall be a party to this Agreement and, to the extent of the interest
assigned by such Assignment and Assumption, have the rights and obligations of a
Lender under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Assumption, be released
from its obligations under this Agreement (and, in the case of an Assignment and
Assumption covering all of the assigning Lender's rights and obligations under
this Agreement, such Lender shall cease to be a party hereto but shall continue
to be entitled to the benefits of Sections 3.01, 3.04, 3.05, 11.04 and 11.05
with respect to facts and circumstances occurring prior to the effective date of
such assignment). Upon request, the Borrower (at its expense) shall execute and
deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of
rights or obligations under this Agreement
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that does not comply with this subsection shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with subsection (d) of this Section.
(c) The Administrative Agent, acting solely for this purpose as an
agent of the Borrower, shall maintain at the Administrative Agent's Office a
copy of each Assignment and Assumption delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Revolving
Commitments of, and principal amounts of the Loans and L/C Obligations owing to,
each Lender pursuant to the terms hereof from time to time (the "Register"). The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for
all purposes of this Agreement, notwithstanding notice to the contrary. The
Register shall be available for inspection by the Borrower and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.
(d) Any Lender may at any time, without the consent of, or notice
to, the Borrower or the Administrative Agent, sell participations to any Person
(other than a natural person or the Borrower or any of the Borrower's Affiliates
or Subsidiaries) (each, a "Participant") in all or a portion of such Lender's
rights and/or obligations under this Agreement (including all or a portion of
its Revolving Commitment and/or the Loans (including such Lender's
participations in L/C Obligations and/or Swing Line Loans) owing to it);
provided that (i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the
Administrative Agent and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Agreement. Any agreement or instrument pursuant to which
a Lender sells such a participation shall provide that such Lender shall retain
the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that such
agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other modification
described in the first proviso to Section 11.01 that directly affects such
Participant. Subject to subsection (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and
3.05 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to subsection (b) of this Section. To the extent permitted
by law, each Participant also shall be entitled to the benefits of Section 11.09
as though it were a Lender, provided such Participant agrees to be subject to
Section 2.13 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater
payment under Section 3.01 or 3.04 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower's prior written consent. A Participant that would be a Foreign Lender
if it were a Lender shall not be entitled to the benefits of Section 3.01 unless
the Borrower is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
11.15 as though it were a Lender.
(f) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement (including
under its Note, if any) to secure obligations of such Lender, including any
pledge or assignment to secure obligations to a Federal Reserve Bank; provided
that no such pledge or assignment shall release such Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.
(g) Notwithstanding anything to the contrary contained herein, if
at any time Bank of America assigns all of its Revolving Commitment and Loans
pursuant to subsection (b) above, Bank of America may, (i) upon thirty days'
notice to the Borrower and the Lenders, resign as L/C Issuer and/or (ii) upon
thirty days' notice to the Borrower, resign as Swing Line Lender. In the event
of any such
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resignation as L/C Issuer or Swing Line Lender, the Borrower shall be entitled
to appoint from among the Lenders a successor L/C Issuer or Swing Line Lender
hereunder; provided, however, that no failure by the Borrower to appoint any
such successor shall affect the resignation of Bank of America as L/C Issuer or
Swing Line Lender, as the case may be. If Bank of America resigns as L/C Issuer,
it shall retain all the rights and obligations of the L/C Issuer hereunder with
respect to all Letters of Credit outstanding as of the effective date of its
resignation as L/C Issuer and all L/C Obligations with respect thereto
(including the right to require the Lenders to make Base Rate Loans or fund risk
participations in Unreimbursed Amounts pursuant to Section 2.03(c)). If Bank of
America resigns as Swing Line Lender, it shall retain all the rights of the
Swing Line Lender provided for hereunder with respect to Swing Line Loans made
by it and outstanding as of the effective date of such resignation, including
the right to require the Lenders to make Base Rate Loans or fund risk
participations in outstanding Swing Line Loans pursuant to Section 2.04(c).
11.08 CONFIDENTIALITY.
Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential); (b) to the extent requested by any regulatory
authority; (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process; (d) to any other party to this Agreement;
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder; (f) subject to an agreement containing provisions substantially the
same as those of this Section, to (i) any Eligible Assignee of or Participant
in, or any prospective Eligible Assignee of or Participant in, any of its rights
or obligations under this Agreement or (ii) any direct or indirect contractual
counterparty or prospective counterparty (or such contractual counterparty's or
prospective counterparty's professional advisor) to any credit derivative
transaction relating to obligations of the Loan Parties; (g) with the consent of
the Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes available to
the Administrative Agent or any Lender on a nonconfidential basis from a source
other than the Borrower or any Subsidiary; or (i) to the National Association of
Insurance Commissioners or any other similar organization or any nationally
recognized rating agency that requires access to information about a Lender's or
its Affiliates' investment portfolio in connection with ratings issued with
respect to such Lender or its Affiliates. In addition, the Administrative Agent
and the Lenders may disclose the existence of this Agreement and information
about this Agreement to market data collectors, similar service providers to the
lending industry, and service providers to the Administrative Agent and the
Lenders in connection with the administration and management of this Agreement,
the other Loan Documents, the Revolving Commitments, and the Credit Extensions.
For the purposes of this Section, "Information" means all information received
from any Loan Party relating to any Loan Party or its business, other than any
such information that is available to the Administrative Agent or any Lender on
a nonconfidential basis prior to disclosure by any Loan Party; provided that, in
the case of information received from a Loan Party after the date hereof, such
information is clearly identified in writing at the time of delivery as
confidential. Any Person required to maintain the confidentiality of Information
as provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information. Notwithstanding anything herein to the
contrary, "Information" shall not include, and the Administrative Agent and each
Lender may disclose without limitation of any kind, any information with respect
to the "tax treatment" and "tax structure" (in each case, within the meaning of
Treasury Regulation Section 1.6011-4) of the transactions contemplated hereby
and all materials of any kind (including opinions or other tax analyses) that
are provided to the Administrative Agent or such
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Lender relating to such tax treatment and tax structure; provided that with
respect to any document or similar item that in either case contains information
concerning the tax treatment or tax structure of the transaction as well as
other information, this sentence shall only apply to such portions of the
document or similar item that relate to the tax treatment or tax structure of
the Loans, Letters of Credit and transactions contemplated hereby.
11.09 SET-OFF.
In addition to any rights and remedies of the Lenders provided by law,
upon the occurrence and during the continuance of any Event of Default, each
Lender and any Affiliate of a Lender is authorized at any time and from time to
time, without prior notice to the Borrower or any other Loan Party, any such
notice being waived by the Borrower (on its own behalf and on behalf of each
Loan Party) to the fullest extent permitted by law, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held by, and other indebtedness at any time owing by, such Lender to or for
the credit or the account of the respective Loan Parties against any and all
Obligations owing to such Lender hereunder or under any other Loan Document, now
or hereafter existing, irrespective of whether or not the Administrative Agent
or such Lender shall have made demand under this Agreement or any other Loan
Document and although such Obligations may be contingent or unmatured or
denominated in a currency different from that of the applicable deposit or
indebtedness. Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application.
11.10 INTEREST RATE LIMITATION.
Notwithstanding anything to the contrary contained in any Loan
Document, the interest paid or agreed to be paid under the Loan Documents shall
not exceed the maximum rate of non-usurious interest permitted by applicable Law
(the "Maximum Rate"). If the Administrative Agent or any Lender shall receive
interest in an amount that exceeds the Maximum Rate, the excess interest shall
be applied to the principal of the Loans or, if it exceeds such unpaid
principal, refunded to the Borrower. In determining whether the interest
contracted for, charged, or received by the Administrative Agent or a Lender
exceeds the Maximum Rate, such Person may, to the extent permitted by applicable
Law, (a) characterize any payment that is not principal as an expense, fee, or
premium rather than interest, (b) exclude voluntary prepayments and the effects
thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal
parts the total amount of interest throughout the contemplated term of the
Obligations hereunder.
11.11 COUNTERPARTS.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
11.12 INTEGRATION.
This Agreement, together with the other Loan Documents, comprises the
complete and integrated agreement of the parties on the subject matter hereof
and thereof and supersedes all prior agreements, written or oral, on such
subject matter. In the event of any conflict between the provisions of this
Agreement and those of any other Loan Document, the provisions of this Agreement
shall control; provided that the inclusion of supplemental rights or remedies in
favor of the Administrative Agent or the Lenders in any other Loan Document
shall not be deemed a conflict with this Agreement. Each Loan Document was
drafted with the joint participation of the respective parties thereto and shall
be construed neither against nor in favor of any party, but rather in accordance
with the fair meaning thereof.
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11.13 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
All representations and warranties made hereunder and in any other Loan
Document or other document delivered pursuant hereto or thereto or in connection
herewith or therewith shall survive the execution and delivery hereof and
thereof. Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and notwithstanding
that the Administrative Agent or any Lender may have had notice or knowledge of
any Default at the time of any Credit Extension, and shall continue in full
force and effect as long as any Loan or any other Obligation hereunder shall
remain unpaid or unsatisfied or any Letter of Credit shall remain outstanding.
11.14 SEVERABILITY.
If any provision of this Agreement or the other Loan Documents is held
to be illegal, invalid or unenforceable, (a) the legality, validity and
enforceability of the remaining provisions of this Agreement and the other Loan
Documents shall not be affected or impaired thereby and (b) the parties shall
endeavor in good faith negotiations to replace the illegal, invalid or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the illegal, invalid or unenforceable
provisions. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
11.15 TAX FORMS.
(a) (i) Each Lender that is not a "United States person"
within the meaning of Section 7701(a)(30) of the Internal Revenue Code
(a "Foreign Lender") shall deliver to the Administrative Agent, prior
to receipt of any payment subject to withholding under the Internal
Revenue Code (or upon accepting an assignment of an interest herein),
two duly signed completed copies of either IRS Form W-8BEN or any
successor thereto (relating to such Foreign Lender and entitling it to
an exemption from, or reduction of, withholding tax on all payments to
be made to such Foreign Lender by the Borrower pursuant to this
Agreement) or IRS Form W-8ECI or any successor thereto (relating to all
payments to be made to such Foreign Lender by the Borrower pursuant to
this Agreement) or such other evidence satisfactory to the Borrower and
the Administrative Agent that such Foreign Lender is entitled to an
exemption from, or reduction of, U.S. withholding tax, including any
exemption pursuant to Section 881(c) of the Internal Revenue Code.
Thereafter and from time to time, each such Foreign Lender shall (A)
promptly submit to the Administrative Agent such additional duly
completed and signed copies of one of such forms (or such successor
forms as shall be adopted from time to time by the relevant United
States taxing authorities) as may then be available under then current
United States laws and regulations to avoid, or such evidence as is
satisfactory to the Borrower and the Administrative Agent of any
available exemption from or reduction of, United States withholding
taxes in respect of all payments to be made to such Foreign Lender by
the Borrower pursuant to this Agreement, (B) promptly notify the
Administrative Agent of any change in circumstances which would modify
or render invalid any claimed exemption or reduction, and (C) take such
steps as shall not be materially disadvantageous to it, in the
reasonable judgment of such Lender, and as may be reasonably necessary
(including the re-designation of its Lending Office) to avoid any
requirement of applicable Laws that the Borrower make any deduction or
withholding for taxes from amounts payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or
ceases to act for its own account with respect to any portion of any
sums paid or payable to such Lender under any of the
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Loan Documents (for example, in the case of a typical participation by
such Lender), shall deliver to the Administrative Agent on the date
when such Foreign Lender ceases to act for its own account with respect
to any portion of any such sums paid or payable, and at such other
times as may be necessary in the determination of the Administrative
Agent (in the reasonable exercise of its discretion), (A) two duly
signed completed copies of the forms or statements required to be
provided by such Lender as set forth above, to establish the portion of
any such sums paid or payable with respect to which such Lender acts
for its own account that is not subject to U.S. withholding tax, and
(B) two duly signed completed copies of IRS Form W-8IMY (or any
successor thereto), together with any information such Lender chooses
to transmit with such form, and any other certificate or statement of
exemption required under the Internal Revenue Code, to establish that
such Lender is not acting for its own account with respect to a portion
of any such sums payable to such Lender.
(iii) The Borrower shall not be required to pay any
additional amount to any Foreign Lender under Section 3.01 (A) with
respect to any Taxes required to be deducted or withheld on the basis
of the information, certificates or statements of exemption such Lender
transmits with an IRS Form W-8IMY pursuant to this Section 11.15(a) or
(B) if such Lender shall have failed to satisfy the foregoing
provisions of this Section 11.15(a); provided that if such Lender shall
have satisfied the requirement of this Section 11.15(a) on the date
such Lender became a Lender or ceased to act for its own account with
respect to any payment under any of the Loan Documents, nothing in this
Section 11.15(a) shall relieve the Borrower of its obligation to pay
any amounts pursuant to Section 3.01 in the event that, as a result of
any change in any applicable law, treaty or governmental rule,
regulation or order, or any change in the interpretation,
administration or application thereof, such Lender is no longer
properly entitled to deliver forms, certificates or other evidence at a
subsequent date establishing the fact that such Lender or other Person
for the account of which such Lender receives any sums payable under
any of the Loan Documents is not subject to withholding or is subject
to withholding at a reduced rate.
(iv) The Administrative Agent may, without reduction,
withhold any Taxes required to be deducted and withheld from any
payment under any of the Loan Documents with respect to which the
Borrower is not required to pay additional amounts under this Section
11.15(a).
(b) Upon the request of the Administrative Agent, each Lender that
is a "United States person" within the meaning of Section 7701(a)(30) of the
Internal Revenue Code shall deliver to the Administrative Agent two duly signed
completed copies of IRS Form W-9. If such Lender fails to deliver such forms,
then the Administrative Agent may withhold from any interest payment to such
Lender an amount equivalent to the applicable back-up withholding tax imposed by
the Internal Revenue Code, without reduction.
(c) If any Governmental Authority asserts that the Administrative
Agent did not properly withhold or backup withhold, as the case may be, any tax
or other amount from payments made to or for the account of any Lender, such
Lender shall indemnify the Administrative Agent therefor, including all
penalties and interest, any taxes imposed by any jurisdiction on the amounts
payable to the Administrative Agent under this Section, and costs and expenses
(including Attorney Costs) of the Administrative Agent. The obligation of the
Lenders under this Section shall survive the termination of the Aggregate
Revolving Commitments, repayment of all Obligations and the resignation of the
Administrative Agent.
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11.16 REPLACEMENT OF LENDERS.
Under any circumstances set forth herein providing that the Borrower
shall have the right to replace a Lender as a party to this Agreement, the
Borrower may, upon notice to such Lender and the Administrative Agent, replace
such Lender by causing such Lender to assign its Revolving Commitment and
outstanding Loans (with the assignment fee to be paid by the Borrower in such
instance) pursuant to Section 11.07(b) to one or more other Lenders or Eligible
Assignees procured by the Borrower; provided, however, that if the Borrower
elects to exercise such right with respect to any Lender pursuant to Section
3.06(b), it shall be obligated to replace all Lenders that have made similar
requests for compensation pursuant to Section 3.01 or 3.04. The Borrower shall
(x) pay in full all principal, interest, fees and other amounts owing to such
Lender through the date of replacement (including any amounts payable pursuant
to Section 3.05), (y) provide appropriate assurances and indemnities (which may
include letters of credit) to the L/C Issuer and the Swing Line Lender as each
may reasonably require with respect to any continuing obligation to fund
participation interests in any L/C Obligations or any Swing Line Loans then
outstanding, and (z) release such Lender from its obligations under the Loan
Documents. Any Lender being replaced shall execute and deliver an Assignment and
Assumption with respect to such Lender's Revolving Commitment and outstanding
Loans and participations in L/C Obligations and Swing Line Loans.
11.17 GOVERNING LAW.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE
AGENT AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX
SITTING IN NEW YORK, NEW YORK, OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT
OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER,
THE ADMINISTRATIVE Agent AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF
ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH PARTY
HERETO IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING
OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION
IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED THERETO. EACH PARTY
HERETO WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.
11.18 WAIVER OF RIGHT TO TRIAL BY JURY.
EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT
OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR THE
TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH
94
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
11.19 DESIGNATED SENIOR INDEBTEDNESS.
(a) The parties hereto intend for this Agreement to be the "Credit
Agreement" under, and as defined in, the Senior Subordinated Notes Documents. If
for any reason this Agreement is not deemed to be the "Credit Agreement" under,
and as defined in, the Senior Subordinated Notes Documents, the Borrower hereby
specifically designates the Obligations as "Designated Senior Debt" for purposes
of the Senior Subordinated Notes Documents.
(b) The Lenders hereby appoint the Administrative Agent as
administrative agent for purposes of the Sunrise Subordination Agreement and
agree that the Administrative Agent shall be the "Agent" for purposes of the
Sunrise Subordination Agreement.
11.20 USA PATRIOT ACT NOTICE.
Each Lender and the Administrative Agent (for itself and not on behalf
of any Lender) hereby notifies the Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the "Act"), it is required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the
Borrower and other information that will allow such Lender or the Administrative
Agent, as applicable, to identify the Borrower in accordance with the Act.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
BORROWER:
PSYCHIATRIC SOLUTIONS, INC., a Delaware corporation
By: ________________________________________
Name:
Title:
GUARANTORS:
AERIES HEALTHCARE CORPORATION, a Delaware corporation
AERIES HEALTHCARE OF ILLINOIS, INC., an Illinois corporation
BOUNTIFUL PSYCHIATRIC HOSPITAL, INC., a Utah corporation
COLLABORATIVE CARE CORPORATION, a Tennessee corporation
EAST CAROLINA PSYCHIATRIC SERVICES CORPORATION, a North Carolina corporation
GREAT PLAINS HOSPITAL, INC., a Missouri corporation
GULF COAST TREATMENT CENTER, INC., a Florida corporation
H.C. CORPORATION, an Alabama corporation
HAVENWYCK HOSPITAL INC., a Michigan corporation
HSA HILL CREST CORPORATION, an Alabama corporation
HSA OF OKLAHOMA, INC., an Oklahoma corporation
INFOSCRIBER CORPORATION, a Delaware corporation
LAURELWOOD CENTER, INC., a Mississippi corporation
MICHIGAN PSYCHIATRIC SERVICES, INC., a Michigan corporation
PREMIER BEHAVIORAL SOLUTIONS, INC., a Delaware corporation
PREMIER BEHAVIORAL SOLUTIONS OF ALABAMA, INC., a Delaware corporation
PSI CEDAR SPRINGS HOSPITAL, INC., a Delaware corporation
PSI COMMUNITY MENTAL HEALTH AGENCY MANAGEMENT, INC., a Tennessee corporation
PSI-EAP, INC., a Delaware corporation
PSI HOSPITALS, INC., a Delaware corporation
PSYCHIATRIC MANAGEMENT RESOURCES, INC., a California corporation
PSYCHIATRIC PRACTICE MANAGEMENT OF ARKANSAS, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS HOSPITALS, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF ALABAMA, INC. a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF ARIZONA, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF FLORIDA, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF LOUISIANA, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF NORTH CAROLINA, INC., a Tennessee corporation
PSYCHIATRIC SOLUTIONS OF OKLAHOMA, INC., a Delaware corporation
PSYCHIATRIC SOLUTIONS OF TENNESSEE, INC., a Tennessee corporation
RAMSAY MANAGED CARE, INC., a Delaware corporation
By: ___________________________________
Name:
Title:
[SIGNATURE PAGES CONTINUE]
RAMSAY TREATMENT SERVICES, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF FLORIDA, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF GEORGIA, INC., a Delaware corporation
RAMSAY YOUTH SERVICES OF SOUTH CAROLINA, INC., a Delaware corporation
RHCI SAN ANTONIO, INC., a Delaware corporation
SOLUTIONS CENTER OF LITTLE ROCK, INC., a Tennessee corporation
SUNSTONE BEHAVIORAL HEALTH, INC., a Tennessee corporation
THE COUNSELING CENTER OF MIDDLE TENNESSEE, INC., a Tennessee corporation
TRANSITIONAL CARE VENTURES, INC., a Delaware corporation
TRANSITIONAL CARE VENTURES (TEXAS), INC., a Delaware corporation
PSI TEXAS HOSPITALS, LLC, a Texas limited liability company
THERAPEUTIC SCHOOL SERVICES, LLC, an Oklahoma limited liability company
By: ___________________________________
Name:
Title:
NEURO INSTITUTE OF AUSTIN, L.P., a Texas limited partnership
TEXAS CYPRESS CREEK HOSPITAL, L.P., a Texas limited partnership
TEXAS XXXXXX XXXXX HOSPITAL, L.P., a Texas limited partnership
TEXAS OAKS PSYCHIATRIC HOSPITAL, L.P., a Texas limited partnership
TEXAS SAN MARCOS TREATMENT CENTER, L.P., a Texas limited partnership
TEXAS WEST OAKS HOSPITAL, L.P., a Texas limited partnership
By: PSI TEXAS HOSPITALS, LLC, its general partner
By: ____________________________________
Name:
Title:
H.C. PARTNERSHIP, an Alabama general partnership
By: H.C. CORPORATION, its general partner
HSA HILL CREST CORPORATION, its general partner
By: ____________________________________
Name:
Title:
[SIGNATURE PAGES CONTINUE]
ADMINISTRATIVE
AGENT: BANK OF AMERICA, N.A.,
as Administrative Agent
By: __________________________________________
Name:
Title:
LENDER: BANK OF AMERICA, N.A.,
as a Lender, L/C Issuer and Swing Line Lender
By: __________________________________________
Name:
Title:
