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EXHIBIT 10.65
EXECUTION COPY
EIGHTH AMENDMENT
TO CREDIT AGREEMENT
AMONG
XXXXXXX ENTERPRISES, INC.,
XXXXXXX HEALTH AND REHABILITATION SERVICES, INC.,
(FORMERLY KNOWN AS XXXXXXX CALIFORNIA CORPORATION)
THE SUBSIDIARY GUARANTORS LISTED HEREIN,
THE LENDERS LISTED HEREIN,
AND
THE NIPPON CREDIT BANK, LTD.
LOS ANGELES AGENCY, AS AGENT
Dated as of February 14, 1996
THIS EIGHTH AMENDMENT dated as of February 14, 1996 (this
"Amendment"), is entered into by and among XXXXXXX ENTERPRISES, INC., a
Delaware corporation ("BEI"), XXXXXXX HEALTH AND REHABILITATION SERVICES, INC.
(formerly known as Xxxxxxx California Corporation), a California corporation
("Borrower"), the SUBSIDIARY GUARANTORS listed on the signature pages hereof
(together with BEI, the "Guarantors"), the LENDERS listed on the signature
pages hereof (such lenders, together with each Person that may or has become a
party to the Credit Agreement (as hereinafter defined) pursuant to subsection
10.8 thereof, are referred to herein individually as a "Lender" and
collectively as the "Lenders"), and THE NIPPON CREDIT BANK, LTD., Los Angeles
Agency ("Nippon"), as agent for the Lenders (in such capacity, the "Agent").
This Amendment amends the Credit Agreement dated as of March 2, 1993 by and
among BEI, Borrower, Agent and Lenders, as amended by that certain First
Amendment to Credit Agreement dated as of May 6, 1994, as further amended by
that certain Second Amendment to Credit Agreement dated as of May 19, 1994, as
further amended by that certain Third Amendment to Credit Agreement dated as of
November 1, 1994, as further amended by that certain Fourth Amendment to Credit
Agreement dated as of November 9, 1994, as further amended by that certain
Fifth Amendment to Credit Agreement dated as of December 30, 1994, as further
amended by that certain Sixth Amendment to Credit Agreement dated as of July
25, 1995 and as further amended by that certain Seventh Amendment to Credit
Agreement dated as of September 29, 1995 (as so amended, the "Credit
Agreement"), as set forth herein.
RECITALS
WHEREAS, Borrower desires to amend the Credit Agreement in certain
respects;
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WHEREAS, Lenders and Agent have agreed to approve such amendments;
WHEREAS, Guarantors desire to reaffirm the effectiveness respectively
of the Subsidiary Guaranty Agreement and the BEI Guaranty Agreement;
AGREEMENT
NOW, THEREFORE, in consideration of the terms and conditions herein
contained, BEI, Borrower, Guarantors, Agent and Lenders agree as follows:
1. Definitions, Interpretation. All capitalized terms defined above and
elsewhere in this Amendment shall be used herein as so defined. Unless
otherwise defined herein, all other capitalized terms used herein shall have
the respective meanings given to those terms in the Credit Agreement, as
amended by this Amendment. The rules of construction set forth in Section I of
the Credit Agreement shall, to the extent not inconsistent with the terms of
this Amendment, apply to this Amendment and are hereby incorporated by
reference.
2. Amendment to Credit Agreement. Subject to conditions set forth in
paragraph 4 hereof, the Credit Agreement is hereby amended as follows:
(a) Subsection 5.15(l) of the Credit Agreement is hereby amended by
deleting the word "and" appearing at the end thereof.
(b) Subsection 5.15(m) of the Credit Agreement is hereby amended by
deleting the "." appearing at the end thereof and substituting "; and"
therefor.
(c) Subsection 5.15 of the Credit Agreement is hereby amended by
adding the following clause at the end thereof:
(n) Contingent obligations incurred by Subsidiaries of BEI to
guaranty BEI's $180,000,000 Senior Notes due 2006 issued in the
first quarter of 1996 substantially in accordance with the terms
and conditions set forth in the Prospectus relating thereto
dated as of February 9, 1996 ("Unsecured Senior Notes");
provided, that $170,000,000 of the aggregate amount of the
proceeds of the Unsecured Senior Notes is used on the date of
issuance thereof to repay or reimburse the Borrower for repaying
(1) the Xxxxxx Term Loans in an amount not less than
$87,500,000; (2) the LTCB Notes in an amount not less than
$28,000,000; (3) the Notes in an amount not less than
$8,750,000; and (4) the remaining balance to
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repay a portion of the revolving loans outstanding under the
Xxxxxx Credit Agreement.
3. Representations and Warranties. In order to induce the Agent and the
Lenders to enter into this Amendment, each of BEI and Borrower represents and
warrants to the Agent and the Lenders that:
(a) The representations and warranties of each Loan Party contained
in the Credit Agreement are true, correct and complete in all material
respects on and as of the date hereof to the same extent as though made on
and as of the date hereof except to the extent that such representations
and warranties specifically relate to an earlier date, in which case they
are true, correct and complete in all material respects as of such earlier
date;
(b) No event has occurred and is continuing or would result from the
execution of this Amendment that constitutes an Event of Default or
Potential Event of Default;
(c) Each Loan Party has performed in all material respects all
agreements and satisfied all conditions that the Credit Agreement and this
Amendment provide shall be performed by it on or before the date hereof;
(d) The execution, delivery and performance of this Amendment, and
the Credit Agreement as amended by this Amendment, by each Loan Party
which is a party thereto are within the corporate power and authority of
each such Loan Party and, as of the Eighth Amendment Effective Date (as
hereinafter defined), will be duly authorized by all necessary corporate
action on the part of each Loan Party, and this Amendment as of the
Eighth.Amendment Effective Date, are duly executed and delivered by each
of such Loan Parties which is a party thereto and will constitute a valid
and binding agreement of each of such Loan Parties, enforceable against
such Loan Parties in accordance with their terms, except as may be limited
by bankruptcy, insolvency, reorganization, moratorium or similar laws or
equitable principles relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability. The Credit
Agreement constitutes and, as of the Eighth Amendment Effective Date, the
Credit Agreement, as amended by this Amendment, will constitute, a valid
and binding agreement of each applicable Loan Party, enforceable against
each applicable Loan Party in accordance with their respective terms,
except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws or equitable principles, relating to or
limiting creditors' rights generally or by equitable principles relating
to enforceability.
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(e) The execution and delivery by each applicable Loan Party of this
Amendment, and the performance by each such Loan Party of the Credit
Agreement as amended by this Amendment, do not and will not (i) violate
any provision of any law or any governmental rule or regulation applicable
to any Loan Party, the Certificate or Articles of Incorporation or Bylaws
of any Loan Party or any order, judgment or decree of any court or other
agency of government binding on any Loan Party, (ii) conflict with, result
in a breach of or constitute (with due notice or lapse of time or both) a
default under any instrument that is material, individually or in the
aggregate, and that is binding on such Loan Party, (iii) result in or
require the creation or imposition of any Lien upon any of the properties
or assets of any Loan Party, or (iv) require any approval or consent of
any Person under any instrument that is material, individually or in the
aggregate, and that is binding on such Loan Party.
(f) The execution and delivery by each applicable Loan Party of this
Amendment, and the performance by each such Xxxx.Xxxxx of the Credit
Agreement as amended by this Amendment, do not and will not require any
registration with, consent or approval of, or notice to, or other action -
to, with or by, any federal, state or other governmental authority or
regulatory body.
4. Conditions to Effectiveness. Section 2 of this Amendment shall
become effective only upon the satisfaction of all of the following conditions
precedent (the date of satisfaction of such conditions being referred to herein
as the "Eighth Amendment Effective Date"):
(a) On or before the Eighth Amendment Effective Date, Borrower shall
deliver to the Lenders (or to the Agent for the Lenders with sufficient
originally executed copies, as appropriate, for each Lender and its
counsel) the following, each, unless otherwise noted, dated the Eighth
Amendment Effective Date, duly executed and delivered by the parties
thereto:
(i) Signature and incumbency certificates of each of BEI,
Borrower and each Subsidiary Guarantor of its respective officers
executing this Amendment certified by such party's respective
secretary or assistant secretary; and
(ii) Executed counterparts of this Amendment.
(b) On or before the Eighth Amendment Effective Date, all corporate
and other proceedings taken or to be taken in connection with the
transactions contemplated hereby and all documents incidental thereto not
previously found acceptable by the Agent, acting on behalf of the Lenders,
and its counsel shall be satisfactory in form and substance to the
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Agent and such counsel, and the Agent and such counsel shall have received
all such counterpart originals or certified copies of such documents as
the Agent may reasonably request
(c) On or before the Eighth Amendment Effective Date, AdviNet, Inc.,
Xxxxxxx Crest Corporation, Xxxxxxx Enterprises-Distribution Services,
Inc., Hospice Preferred Choice, Inc., Xxxxxxx Rehabilitation Services,
Inc., Synergos, Inc., Synergos-Scottsdale, Inc., Synergos- Pleasanthill,
Inc. and Synergos-North Hollywood, Inc. each shall have executed a
Subsidiary Guaranty Agreement under which each such Subsidiary Guarantor
guarantees the Obligations under the Credit Agreement as amended by this
Amendment.
(d) On or before the Eighth Amendment Effective Date, the Borrower
shall have caused payment to the Agent of all amounts regarding the costs
and expenses reasonably incurred by Agent in connection with this
Amendment.
5. Acknowledgment and Agreement of Guarantors. Each Guarantor
acknowledges that it has reviewed the terms and provisions of the Credit
Agreement and this Amendment and consents to the amendment of the Credit
Agreement effected pursuant to this Amendment. Each Guarantor hereby confirms
that the Guaranty Agreement and the Collateral Documents to which it is a party
or otherwise bound and all Collateral encumbered thereby will continue to
guaranty or secure, as the case may be, to the fullest extent possible the
payment and performance of all Obligations, Guarantied Obligations (as defined
in the applicable Guaranty Agreements) and Secured Obligations (as defined in
the Collateral Documents), as the case may be, including, without limitation,
the payment and performance of all Obligations of Borrower now or hereafter
existing under or in respect of the Credit Agreement as amended by this
Amendment and the Notes defined therein.
Each Guarantor acknowledges and agrees that any of the Guaranty
Agreements and the Collateral Documents to which it is a party or otherwise
bound shall continue in full force and effect and that all of its obligations
thereunder shall be valid and enforceable and shall not be impaired or limited
by the execution or effectiveness of this Amendment. Each Guarantor represents
and warrants that all representations and warranties contained in the Credit
Agreement as amended by this Amendment and the Guaranty Agreements and the
Collateral Documents to which it is a party or otherwise bound are true,
correct and complete in all material respects on and as of the Eighth Amendment
Effective Date to the same extent as though made on and as of that date except
to the extent that such representations and warranties specifically relate to
an earlier date, in which case they are true, correct and complete in all
material respects as of such earlier date.
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Each Guarantor acknowledges and agrees that in addition to all the
other waivers agreed to and made by Guarantor as set forth in the Guaranty
Agreement and the Collateral Documents to which it is a party or otherwise
bound, and pursuant to the provisions of California Civil Code Section 2856,
"Guarantor waives all rights and defenses arising out of an election of
remedies by the creditor, even though that election of remedies, such as a
nonjudicial foreclosure with respect to security for a guaranteed obligation,
has destroyed the Guarantor's rights of subrogation and. reimbursement against
the principal by the operation of Section 580d of the Code of Civil Procedure
or otherwise. "
Each Guarantor acknowledges and agrees that (i) notwithstanding the
conditions to effectiveness set forth in this Amendment, such Guarantor is not
required by the terms of the Credit Agreement or any other Loan Document to
consent to the amendments to the Credit Agreement effected pursuant to this
Amendment or any other Loan Document and (ii) that neither the terms of the
Credit Agreement, any other Loan Document nor this Amendment shall be deemed to
require the consent of any Guarantor to any future amendments to the Credit
Agreement.
6. Effectiveness; Counterparts. This Amendment may be executed in any
number of counterparts, and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument. This Amendment (other than the provisions of Section 2) shall
become effective upon the execution of a counterpart hereof by all Lenders and
each of the Loan Parties and receipt of written or telephonic notification of
such execution and authorization of delivery thereof.
7. Fees and Expenses. The Borrower acknowledges that all costs, fees
and expenses as described in subsection 10.4 of the Credit Agreement incurred
by the Agent and its counsel with respect to this Amendment and the documents
and transactions contemplated hereby shall be for the account of the Borrower.
8. Effect of Amendment. It is hereby agreed that, except as
specifically provided herein, this Amendment does not in any way affect or
impair the terms and conditions of the Credit Agreement, and all terms and
conditions of the Credit Agreement are to remain in full force and effect
unless otherwise specifically amended or changed pursuant to the terms and
conditions of this Amendment.
9. Applicable Law. This Amendment and the rights and obligations of the
parties hereto and all other aspects hereof shall be deemed to be made under,
shall be governed by, and shall be construed and enforced in accordance with,
the laws of the State of New York without regard to principles of conflicts of
laws.
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WITNESS the due execution hereof by the respective duly authorized
officers of the undersigned as of the date first written above.
BEI:
XXXXXXX ENTERPRISES, INC.
By:
Title:
Borrower:
XXXXXXX HEALTH AND REHABILITATION
SERVICES, INC.
By:
Title:
Agent:
THE NIPPON CREDIT BANK, LTD.,
LOS ANGELES AGENCY,
as Agent
By:
Title:
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Lenders:
THE NIPPON CREDIT BANK, LTD.,
LOS ANGELES AGENCY,
as a Lender
By:
Title:
TORONTO-DOMINION (TEXAS), INC.,
as a Lender
By:
Title:
[Signatures Continued]
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The Subsidiary Guarantors:
American Transitional Care
Centers of Texas, Inc.
American Transitional Care
Dallas-Ft. Worth, Inc.
American Transitional Health
Care, Inc.
American Transitional
Hospitals, Inc.
American Transitional
Hospitals of Indiana, Inc.
American Transitional
Hospitals of Oklahoma, Inc.
American Transitional
Hospitals of Tennessee, Inc.
ATH Del Oro, Inc.
ATH Heights, Inc.
ATH Tucson, Inc.
Xxxxxxx Enterprises -
Alabama, Inc.
Xxxxxxx Enterprises -
Arkansas, Inc.
Xxxxxxx Enterprises -
Florida, Inc.
Xxxxxxx Enterprises -
Georgia, Inc.
Xxxxxxx Enterprises
Japan Limited
Xxxxxxx Enterprises-
Maryland, Inc.
Xxxxxxx Enterprises -
Massachusetts, Inc.
Xxxxxxx Enterprises -
Minnesota, Inc.
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Xxxxxxx Enterprises -
Mississippi, Inc.
Xxxxxxx Enterprises -
Missouri, Inc.
Xxxxxxx Enterprises -
Nebraska, Inc.
Xxxxxxx Enterprises -
North Carolina, Inc.
Xxxxxxx Enterprises -
Oregon
Xxxxxxx Enterprises -
Wisconsin, Inc.
Commercial Management,
Inc.
Hallmark Convalescent
Homes, Inc.
Hospital Facilities
Corporation
Moderncare of Lumberton,
Inc.
Nebraska City S-C-H, Inc.
South Dakota - Xxxxxxx
Enterprises, Inc.
Vantage Healthcare
Corporation
AGI-Camelot, Inc.
AGI-XxXxxxxx County
Health Care, Inc.
Xxxxxxx Enterprises -
Arizona, Inc.
Xxxxxxx Enterprises -
California, Inc.
Xxxxxxx Enterprises -
Colorado, Inc.
Xxxxxxx Enterprises -
Connecticut, Inc.
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Xxxxxxx Enterprises -
Garden Terrace, Inc.
Xxxxxxx Enterprises -
Hawaii, Inc.
Xxxxxxx Enterprises -
Idaho, Inc.
Xxxxxxx Enterprises -
Illinois, Inc.
Xxxxxxx Enterprises -
Indiana, Inc.
Xxxxxxx Enterprises -
Kansas, Inc.
Xxxxxxx Enterprises -
Kentucky, Inc.
Xxxxxxx Enterprises -
Louisiana, Inc.
Xxxxxxx Enterprises -
Michigan, Inc.
Xxxxxxx Enterprises -
New Jersey, Inc.
Xxxxxxx Enterprises -
Ohio, Inc.
Xxxxxxx Enterprises -
Pennsylvania, Inc.
Xxxxxxx Enterprises -
South Carolina, Inc.
Xxxxxxx Enterprises -
Tennessee, Inc.
Xxxxxxx Enterprises -
Texas, Inc.
Xxxxxxx Enterprises -
Utah, Inc.
Xxxxxxx Enterprises -
Virginia, Inc.
Xxxxxxx Enterprises -
Washington, Inc.
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Xxxxxxx Enterprises -
West Virginia, Inc.
Xxxxxxx Indemnity, Ltd.
Xxxxxxx Manor Inc. of
Hawaii
Xxxxxxx Savana Cay Manor,
Inc.
Columbia-Valley Nursing
Home, Inc.
Computran Systems, Inc.
Continental Care Centers
of Council Bluffs, Inc.
Forest City Building Ltd.
Home Medical Systems,
Inc.
Kenwood View Nursing
Home, Inc.
Liberty Nursing Homes,
Incorporated
Medical Arts Health
Facility of
Lawrenceville, Inc.
Nursing Home Operators,
Inc.
Xxxxxxxx Health Care,
Inc.
Pharmacy Corporation of
America
Salem No. 1, Inc.
South Alabama Nursing
Home, Inc.
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Xxxxxx County Health
Facility, Incorporated
Alliance Health Services,
Inc.
Healthcare Prescription
Services, Inc.
Xxxxxxxxxx Drugs, Inc.
Insta-Care Holdings, Inc.
AdviNet, Inc.
Xxxxxxx Crest Corporation
Xxxxxxx Enterprises-
Distribution Services, Inc.
Hospice Preferred Choice,
Inc.
Xxxxxxx Rehabilitation
Services, Inc.
Synergos, Inc.
Synergos - Scottsdale, Inc.
Synergos- Pleasanthill, Inc.
Synergos - North Hollywood,
Inc.
By:
Title:
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