Exhibit 99(b)
EXECUTION COPY
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LOAN AGREEMENT
Dated as of April 2, 2002
between
SHL TELEMEDICINE NORTH AMERICA, INC., As Borrower,
and
BANK LEUMI USA, As Bank.
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TABLE OF CONTENTS
PAGE
SECTION 1. DEFINITIONS AND ACCOUNTING TERMS................................................................1
1.1 DEFINED TERMS:..................................................................................1
1.2 ACCOUNTING TERMS. .............................................................................5
SECTION 2. FINANCING.......................................................................................5
2.1 TERM LOAN.......................................................................................5
2.2 PRINCIPAL.......................................................................................5
2.3 INTEREST RATE, FEES AND OTHER CHARGES...........................................................5
2.4 PREPAYMENT......................................................................................8
2.5 MANNER OF PAYMENT...............................................................................8
SECTION 3. CONDITIONS PRECEDENT............................................................................9
3.1 CONDITIONS TO MAKING THE TERM LOAN..............................................................9
SECTION 4. REPRESENTATIONS AND WARRANTIES..................................................................9
4.1 ORGANIZATION...................................................................................10
4.2 AUTHORIZATION..................................................................................10
4.3 NO CONFLICTS...................................................................................10
4.4 COMPLIANCE AND OTHER AGREEMENTS................................................................11
4.5 ERISA..........................................................................................11
4.6 INVESTMENT COMPANY.............................................................................12
4.7 APPROVALS AND CONSENTS.........................................................................12
4.8 REGULATION U; SECURITIES EXCHANGE ACT OF 1934..................................................12
4.9 USE OF FUNDS...................................................................................12
4.10 TAXES..........................................................................................12
4.11 LITIGATION.....................................................................................13
4.12 DISCLOSURE.....................................................................................13
SECTION 5. AFFIRMATIVE COVENANTS..........................................................................13
5.1 PRESERVATION OF EXISTENCE......................................................................13
5.2 MAINTENANCE OF INSURANCE.......................................................................13
5.3 PAYMENT OF TAXES...............................................................................13
5.4 INSPECTION.....................................................................................13
5.5 ACCOUNTING; FINANCIAL STATEMENTS AND OTHER INFORMATION.........................................14
5.6 COMPLIANCE.....................................................................................15
5.7 ERISA..........................................................................................15
5.8 CHANGE IN BUSINESS.............................................................................16
5.9 NOTIFICATION TO BANK...........................................................................16
5.10 FURTHER ASSURANCES.............................................................................16
SECTION 6. INTENTIONALLY OMITTED..........................................................................16
SECTION 7. EVENTS OF DEFAULT/REMEDIES.....................................................................16
7.1 EVENTS OF DEFAULT..............................................................................18
7.2 REMEDIES.......................................................................................19
SECTION 8. MISCELLANEOUS..................................................................................19
8.1 EXPENSES.......................................................................................19
8.2 SURVIVAL OF AGREEMENT..........................................................................19
8.3 NO WAIVER; CUMULATIVE REMEDIES.................................................................19
8.4 NOTICES AND DELIVERIES.........................................................................22
8.5 AMENDMENTS AND WAIVERS.........................................................................22
8.6 APPLICABLE LAW.................................................................................22
8.7 SUCCESSORS.....................................................................................22
8.8 PARTIAL INVALIDITY.............................................................................22
8.9 HEADINGS AND WORD MEANINGS.....................................................................22
8.10 WAIVER OF JURY TRIAL...........................................................................22
8.11 JURISDICTION; SERVICE OF PROCESS. ............................................................22
8.12 INDEMNITY......................................................................................23
8.13 MARSHALLING; RECOURSE TO SECURITY; PAYMENTS SET ASIDE..........................................23
8.14 SET-OFF........................................................................................23
8.15 COUNTERPARTS; FACSIMILE SIGNATURE..............................................................24
LOAN AGREEMENT
LOAN AGREEMENT, dated as of April 2, 2002, among SHL TELEMEDICINE NORTH
AMERICA, INC., a Delaware corporation having its principal office at c/o Xxxxx
Xxxxxxxxxx, Lasa, Xxxxxxx & Veve, 0000 X Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxx, D.
C. 20037 (the "Borrower"), and BANK LEUMI USA, a New York banking corporation
having an office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (the "Bank").
R E C I T A L S:
The Borrower desires the Bank, and the Bank is willing, subject to and
upon the terms and conditions set forth in this Agreement and in the "Financing
Agreements" (as hereinafter defined), to make a term loan to the Borrower in the
principal sum of $24,000,000.
NOW, THEREFORE, IT IS AGREED:
SECTION 1. DEFINITIONS AND ACCOUNTING TERMS.
1.1 DEFINED TERMS. :
"ACQUISITION CORP." shall mean SHL TeleMedicine Acquisition Corp., a
Delaware corporation, and shall not include Target Corp.
"AFFILIATE" shall mean, with respect to any specified Person, any other
Person directly or indirectly controlling or controlled by or under direct or
indirect common control with, such specified Person. For purposes of this
definition, "control" (including, with correlative meanings, the terms
"controlled by" and "under common control with") when used with respect to any
specified Person, shall mean the power to direct or cause the direction of the
actions, management or policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise and whether
or not such power is actually exercised.
"AGREEMENT" shall mean this Loan Agreement, as amended, modified or
supplemented from time to time in accordance with its terms.
"BANK" shall mean Bank Leumi USA, and its successors and assigns.
"BLITA" shall mean Bank Leumi Le-Israel B.M., and its successors and
assigns.
"BORROWER" shall mean SHL TELEMEDICINE NORTH AMERICA, INC., a Delaware
corporation and the holder of all of the issued and outstanding shares of
capital stock of Acquisition Corp.
"BUSINESS DAY" shall mean any day other than (i) a Saturday, Sunday or
other day on which commercial banks in New York, New York are authorized or
required to close under the
laws of the State of New York, and (ii) when used with respect to any LIBOR
Loan, such definition shall also exclude any day on which commercial banks in
London are not open for dealing in Dollar deposits in the London Interbank
Market.
"CLOSING DATE" shall mean the date of this Agreement.
"COMMONLY CONTROLLED ENTITY" means an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 414(b) or 414(c) of the Internal Revenue Code of 1986, as amended,
but excluding Target Corp. and its Subsidiaries.
"DOLLARS" and the symbol "$" shall mean lawful currency of the United
States of America.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations and published interpretations
thereof.
"EUROCURRENCY RESERVE REQUIREMENT" shall mean, with respect to any
LIBOR Loan for any Interest Period therefor, the daily average of the stated
maximum rate (expressed as a decimal) at which reserves (including any marginal,
supplemental, or emergency reserves) are required to be maintained by the Bank
during such Interest Period under Regulation D against "Eurocurrency
Liabilities" (as such term is used in Regulation D) but without benefit or
credit of proration, exemptions, or offsets that might otherwise be available to
the Bank from time to time under Regulation D. Without limiting the effect of
the foregoing, the Eurocurrency Reserve Requirement shall reflect any other
reserves required to be maintained by the Bank against (i) any category of
liabilities that includes deposits by reference to which the LIBOR Rate for
LIBOR Loans is to be determined; or (ii) any category of extension of credit or
other assets that include LIBOR Loans.
"FINANCING AGREEMENTS" shall mean the following agreements and
instruments (as such agreements and instruments may be hereafter amended,
modified or supplemented in accordance with their respective terms): (i) the
Term Note, and (ii) any other supplementary agreements or instruments now or
hereafter delivered to the Bank by the Borrower in connection with the Term
Loan.
"IAS" shall mean international accounting standards applied on a
consistent basis.
"INTEREST PERIOD" shall mean, with respect to any LIBOR Loan (i)
initially, the period commencing on the Closing Date and ending on the same day
six (6) months thereafter, and (ii) thereafter, each period commencing on the
last day of the next preceding Interest Period and ending on the same day six
months thereafter; PROVIDED, HOWEVER, that (i) each such Interest Period that
commences on the last Business Day of a calendar month (or on any day for which
there is no numerically corresponding day in the appropriate subsequent calendar
month) shall end on the last Business Day of the appropriate subsequent calendar
month; (ii) no Interest Period may extend beyond the Maturity Date; and (iii) if
an Interest Period would end on a day that is not a Business Day, such Interest
Period shall be extended to the next Business Day,
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unless such Business Day would fall in the next calendar month, in which event
such Interest Period shall end on the immediately preceding Business Day.
"LIBOR RATE" shall mean, for each LIBOR Loan, the rate per annum
(rounded upward, if necessary, to the nearest 1/16 of 1%) determined by the Bank
to be equal to the quotient of (i) the London Interbank Offered Rate for such
LIBOR Loan for such Interest Period divided by (ii) one minus the Eurocurrency
Reserve Requirement for such Interest Period.
"LIBOR LOAN" shall mean the Term Loan, or any part thereof, when and to
the extent that the interest rate therefor is determined by reference to the
LIBOR Rate as provided in Section 2.3 hereof.
"LONDON INTERBANK OFFERED RATE" applicable to any Interest Period for a
LIBOR Loan means: (i) the rate quoted by the British Bankers Association in
London as its "LIBOR" rate for U.S. dollar deposits at or about 11:00 a.m.,
London time, on the second Business Day prior to the commencement of the
Interest Period; provided, however, that if the Bank adopts generally in its
business a different rate quoting system or service for obtaining the rate of
interest commonly known as "LIBOR" for U.S. dollar deposits, then upon giving
prompt notice to the Borrower of the adoption of such alternative rate quoting
system or service, such alternative rate quoting system or service shall be
utilized for determining "LIBOR" in lieu of the rate quoted by the British
Bankers Association, and (ii) if the rate may not be determined by the Bank as
provided in the preceding clause (i) for any reason, as determined by the Bank
in its reasonable judgment, then the rate equal to the rate of interest per
annum determined by the Bank to be the arithmetic mean (rounded upward to the
next 1/16th of 1%) of the rates of interest per annum at which U.S. dollar
deposits in the approximate amount of the amount of the Term Loan continued
hereunder by the Bank and having a maturity comparable to such Interest Period
would be offered to the Bank in the London Interbank market at its request at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the
commencement of such Interest Period.
"MATURITY DATE" shall mean the date that is the second anniversary date
of this Agreement.
"MERGER AGREEMENT" shall mean the Agreement and Plan of Merger, dated
as of February 7, 2002, among SHL TeleMedicine Ltd., an Israeli company,
Acquisition Corp. and Target Corp.
"MULTIEMPLOYER PLAN" shall mean a Plan described in Section 4001(a)(3)
of ERISA.
"OBLIGATIONS" shall mean all obligations, liabilities and indebtedness
of the Borrower to the Bank under this Agreement and the Financing Agreements,
whether now existing or hereafter created, direct or indirect, due or not,
including, without limitation, all obligations, liabilities and indebtedness of
the Borrower with respect to the Term Loan and all fees, costs, expenses and
indemnity obligations hereunder or thereunder.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor thereto.
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"PERSON" shall mean an individual, partnership, joint venture, firm,
corporation, trust, or other business or legal entity.
"PLAN" shall mean any pension plan which is covered by Title IV of
ERISA and in respect of which the Borrower or a Commonly Controlled Entity is an
"employer" as defined in Section 3(5) of ERISA.
"PROHIBITED TRANSACTION" shall mean any transaction set forth in
Section 406 of ERISA or Section 4975 of the Internal Revenue Code of 1986, as
amended from time to time, other than a transaction for which an administrative
or statutory exemption is available.
"REFERENCE RATE" shall mean the rate of interest designated by the
Bank, and in effect from time to time, as its "Reference Rate", adjusted when
said Reference Rate changes.
"REGULATION U" shall mean Regulation U of the Board of Governors of the
Federal Reserve System as amended or supplemented from time to time.
"REGULATION X" shall mean Regulation X of the Board of Governors of the
Federal Reserve System as amended or supplemented from time to time.
"REPORTABLE EVENT" shall mean any of the events set forth in Section
4043(c) of ERISA, for which notice has not been waived by the PBGC.
"SUBSIDIARY" shall mean a corporation, partnership or other entity of
which shares of stock or other ownership interests having ordinary voting power
(other than stock or such other ownership having such power only by reason of
the happening of a contingency) to elect a majority of the board of directors or
other managers of such corporation, partnership or other entity are at the time
owned, or the management of which is otherwise controlled, directly or
indirectly, through one or more intermediaries, or both, by the Borrower;
provided that the term "Subsidiary" shall not include Target Corp. or its
Subsidiaries.
"TARGET CORP." shall mean Raytel Medical Corporation, a Delaware
corporation, and its successors.
"TERM LOAN" shall have the meaning set forth in Section 2.1 hereof.
"TERM NOTE" shall have the meaning set forth in Section 2.1 hereof.
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1.2 ACCOUNTING TERMS. Except as set forth in the next sentence, all
accounting terms not specifically defined herein shall be construed in
accordance with IAS, and all financial data submitted pursuant to this Agreement
shall be prepared in accordance with such principles. The Borrower shall have
the right, exercisable by giving notice to the Bank no later than December 31,
2002, to elect to utilize United States generally accepted accounting principles
("GAAP") in lieu of IAS, and upon making such election all references in this
Agreement to IAS shall mean GAAP.
SECTION 2. FINANCING.
2.1 TERM LOAN. Subject to the terms and conditions set forth in
this Agreement and the Financing Agreements, concurrently with the execution and
delivery of this Agreement, the Bank shall lend the Borrower the principal sum
of $24,000,000 (the "Term Loan"). The Borrower shall evidence its obligation to
pay the principal of and interest on the Term Loan by executing and delivering
to the Bank a promissory note in the principal sum of $24,000,000 in the form
annexed hereto as Exhibit A (the "Term Note"). The principal of, and interest
on, the Term Loan shall be paid by the Borrower as set forth in the Term Note
and this Agreement. The Borrower hereby authorizes the Bank to disburse the
proceeds of the Term Loan to the account of Acquisition Corp. at the Bank.
2.2 PRINCIPAL. The outstanding principal sum of the Term Loan
shall be paid as follows:
(i) $5,000,000 on the first anniversary of the date of
this Agreement; and
(ii) the outstanding principal balance of the Term Loan
shall be paid in full on the Maturity Date.
2.3 INTEREST RATE, FEES AND OTHER CHARGES.
2.3.1 LIBOR RATE. Except as otherwise expressly provided in
this Section 2.3, the Borrower shall pay interest to the Bank on the outstanding
and unpaid principal amount of the Term Loan at a rate per annum equal to the
LIBOR Rate plus 0.57%; provided that under the circumstances set forth in clause
(ii) of the proviso to the definition of Interest Period (i.e., the Interest
Period would extend after the Maturity Date), the outstanding principal sum of
the Term Loan during such period shall bear interest at a rate per annum equal
the Reference Rate .
2.3.2 AVAILABILITY OF LIBOR LOANS. The Bank shall, as soon as
practicable after 11:00 a.m., New York City time, two (2) Business Days prior to
the commencement of any Interest Period (other than the initial Interest Period,
for which the Bank shall determine the LIBOR Rate as soon as practicable after
11:00 a.m., New York City time, on the Closing Date) determine the LIBOR Rate
applicable for such Interest Period and such LIBOR Rate shall be applicable
during such Interest Period. In the event the Bank shall have determined (which
determination shall be conclusive and binding upon the Borrower) that Dollar
deposits in an amount approximately equal to the LIBOR Loan with maturities
comparable to the Interest
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Period are not generally available at such time in the London Interbank Market,
or the rate at which such Dollar deposits are being offered will not adequately
and fairly reflect the cost to the Bank of making or maintaining a LIBOR Rate on
the LIBOR Loan or of funding the same in the London Interbank Market during such
Interest Period, or reasonable means do not exist for ascertaining a LIBOR Rate,
or a LIBOR Rate on the LIBOR Loan would be in excess of the maximum interest
rate which the Borrower may by law be required to pay, the Bank shall so notify
the Borrower and the LIBOR Loan shall, on the date that otherwise would have
been the first date of the Interest Period and at all times thereafter until the
Bank notifies the Borrower that the circumstances giving rise to such suspension
no longer exist, bear interest at a rate per annum equal the Reference Rate.
2.3.3 CALCULATION OF INTEREST; PAYMENT.
(i) Interest on the Term Loan (including all LIBOR
Loans) shall be calculated on the basis of the actual number of days elapsed in
a 360-day year.
(ii) Interest due on any LIBOR Loan shall be due
and payable on the last day of the Interest Period with respect thereto, and at
maturity of the Term Loan. Whenever interest due on the Term Loan or any portion
thereof (as the case may be) shall be calculated by reference to the Reference
Rate, interest shall be due and payable on the outstanding principal sum of the
Term Loan or such portion (as the case may be) on the last day of each month.
2.3.4 ILLEGALITY. Notwithstanding any other provision in
this Agreement, if the Bank determines that any applicable law, rule or
regulation, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Bank with any request or directive (whether or not having the force of
law) of any such authority, central bank or comparable agency shall make it
unlawful or impossible for the Bank to maintain or fund its LIBOR Loans or to
give effect to its obligations as contemplated hereby, then upon notice by the
Bank to the Borrower, any LIBOR Loan bearing interest determined by reference to
the LIBOR Rate shall be automatically converted to (and shall at all times
thereafter, until the Bank notifies the Borrower that such circumstances no
longer exist, remain as) a loan bearing interest at the Reference Rate, but in
no event in excess of the maximum rate of interest permitted to be charged to
the Borrower pursuant to applicable law.
2.3.5 INCREASED COSTS. The Borrower shall pay to the Bank
from time to time such amounts as the Bank may determine to be necessary to
compensate the Bank for any costs incurred by the Bank which the Bank determines
are attributable to its making or maintaining any LIBOR Loan hereunder, or any
reduction in any amount receivable by the Bank under this Agreement or the Term
Note in respect of any LIBOR Loans (such increases in costs and reductions in
amounts receivable being herein called "Additional Costs"), resulting from any
change after the date of this Agreement in U.S. federal, state, municipal, or
foreign laws or regulations (including Regulation D), or the adoption or making
after such date of any interpretations, directives, or requirements applying to
a class of banks including the Bank of or
6
under any U.S. federal, state, municipal, or any foreign laws or regulations
(whether or not having the force of law) by any court or governmental or
monetary authority charged with the interpretation or administration thereof
("Regulatory Change"), which changes the basis of taxation of any amounts
payable to the Bank under this Agreement or the Term Note in respect of any of
such LIBOR Loans (other than taxes imposed on the overall net income of the Bank
for any of such Loans); or imposes or modifies any reserve, special deposit,
compulsory loan, or similar requirements relating to any extensions of credit or
other assets of, or any deposits with or other liabilities of, the Bank
(including any of such LIBOR Loans or any deposits referred to in the definition
of LIBOR Rate; or imposes any other condition affecting this Agreement or the
Term Note (or any of such extensions of credit or liabilities). The Bank will
notify the Borrower of any event occurring after the date of this Agreement
which will entitle the Bank to compensation pursuant to this Section 2.3.5 as
promptly as practicable after it obtains knowledge thereof and determines to
request such compensation.
Determinations by the Bank for purposes of this Section 2.3.5
of the effect of any Regulatory Change on its costs of making or maintaining
LIBOR Loans or on amounts receivable by it in respect of LIBOR Loans, and of the
additional amounts required to compensate the Bank in respect of any Additional
Costs, shall be conclusive, provided that such determinations are made on a
reasonable basis.
2.3.6 RISK-BASED CAPITAL. In the event the Bank determines
that compliance with any judicial, administrative, or other governmental
interpretation of any law or regulation or compliance by the Bank or any
corporation controlling the Bank with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law)
has the effect of requiring an increase in the amount of capital required or
expected to be maintained by the Bank or any corporation controlling the Bank,
and the Bank determines that such increase is based upon its obligations
hereunder, and other similar obligations, the Borrower shall pay to the Bank
such additional amount as shall be certified by the Bank to be the amount
allocable to the Bank's obligations to the Borrower hereunder. The Bank will
notify the Borrower of any event occurring after the date of this Agreement that
will entitle the Bank to compensation pursuant to this Section 2.3.6 as promptly
as practicable after it obtains knowledge thereof and determines to request such
compensation.
Determinations by the Bank for purposes of this Section 2.3.6
of the effect of any increase in the amount of capital required to be maintained
by the Bank and of the amount allocable to the Bank's obligations to the
Borrower hereunder shall be conclusive, provided that such determinations are
made on a reasonable basis.
For purposes of this Section 2.3.6, the term "Bank" shall
include BLITA so long as it shall have a participation interest in the Term
Loan.
2.3.7 FUNDING LOSS INDEMNIFICATION. The Borrower shall pay
to the Bank, upon the request of the Bank, such amount or amounts as shall be
sufficient (in the reasonable opinion of the Bank) to compensate it for any
loss, cost or expenses incurred as a result of any payment of a LIBOR Loan on a
date other than the last day of the Interest Period for such LIBOR Loan
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including, but not limited to, acceleration of the Term Loan by the Bank
pursuant to Section 7. Such compensation shall be an amount equal to the excess
(if any) of (i) the amount of interest that otherwise would have accrued on the
principal amount so prepaid for the period from the date of such prepayment to
the last day of the then current Interest Period for such LIBOR Loan at the
applicable rate of interest for such LIBOR Loan provided for herein less (ii)
the amount of interest that otherwise would have accrued on such principal
amount from the date of such prepayment until the end of the then current
Interest Period at a rate per annum equal to the LIBOR Rate, determined as of
the date of such prepayment, for maturities comparable to such period (as
reasonably determined by the Bank).
2.3.8. WITHHOLDING INDEMNITY. The Borrower hereby agrees to
indemnify and/or reimburse the Bank for any tax liability (including any
penalties and interest thereon) which may be required to be withheld or paid
over by the Bank to a US taxing authority as a result of the Term Loan made
hereunder. Such liabilities may result from but are not limited to liabilities
of the Bank as a conduit entity under Internal Revenue Code section 7701(1) and
Regulations section 1.881-3. The indemnification/reimbursement obligations of
the Borrower ("Reimbursement Obligations") shall not be imposed on or with
respect to the overall tax on the net income of the Bank, and franchise or
similar taxes which may be imposed by the United States of America or any state
of the United States of America or the District of Columbia. The Reimbursement
Obligations of the Borrower shall survive the repayment of the Term Loan.
2.3.9 OVERDUE PAYMENTS. If any payment of principal
(whether due at maturity, upon acceleration or otherwise), interest or other
fees or charges payable by the Borrower hereunder or under any of the Financing
Agreements shall not be paid when due, the Borrower shall pay interest on the
overdue payment for the period for which overdue, on demand, at 4% in excess of
the interest rate specified for such period, but in no event in excess of the
maximum rate permitted by applicable law.
2.4 PREPAYMENT. The Borrower may, upon at least five (5) Business
Days' notice to the Bank, prepay the Term Loan in whole or in part, together
with accrued interest to the date of such prepayment on the amount prepaid and
any amounts due under Section 2.3.7, provided that each partial prepayment shall
be in a principal amount not less than $1,000,000. All partial prepayments made
prior to the first anniversary of the date of this Agreement shall be applied
first to the $5,000,000 installment due on the first anniversary of the date of
this Agreement and then, if such partial prepayment exceeds $5,000,000, to the
installment due on the Maturity Date.
2.5 MANNER OF PAYMENT. All payments required to be made by the
Borrower hereunder on account of principal, interest or fees shall be made in
Dollars, in immediately available funds, at the office of the Bank at 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 by no later than 2:00 p.m., New York City time,
or at such other place as the holder of the Term Note shall specify in writing.
Whenever any payment hereunder, or under any of the Financing Agreements,
becomes due on a day on which the Bank is closed (as required or permitted by
law or otherwise), such payment shall be made not later than the next succeeding
day on which the Bank is open for business, and such extension of time shall be
included in the computation of
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interest or any other fee due, as the case may be. The Borrower authorizes (but
shall not require) the Bank to debit any account maintained by the Borrower with
the Bank, on any date on which a payment is due hereunder or under any of the
Financing Agreements, in an amount equal to any unpaid portion of such payment.
SECTION 3. CONDITIONS PRECEDENT.
3.1 CONDITIONS TO MAKING THE TERM LOAN. The obligation of the
Bank to make the Term Loan is subject to the conditions precedent that:
3.1.1 FINANCING AGREEMENTS. The Borrower shall have
executed and delivered to the Bank this Agreement and the other Financing
Agreements to be executed by it, and all other agreements, instruments and
documents required or contemplated by this Agreement and the Financing
Agreements.
3.1.2 OPINION OF BORROWER'S COUNSEL. The Bank shall have
received a written opinion of Fulbright & Xxxxxxxx L.L.P., counsel to the
Borrower, dated as of the Closing Date, in form and substance reasonably
satisfactory to the Bank and its counsel.
3.1.3 EVIDENCE OF BORROWER CORPORATE ACTION; CERTIFICATE OF
INCORPORATION AND BY-LAWS. The Bank shall have received copies of all corporate
action taken by the Borrower to authorize the execution, delivery and
performance of this Agreement and the Financing Agreements to be executed by it;
a copy of the Borrower's Certificate of Incorporation, as amended to date; and a
copy of the By-Laws of the Borrower, as amended to date. All of the foregoing
documents shall be certified by the Borrower's Secretary in a Secretary's
Certificate dated as of even date herewith.
3.1.4 REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained in this Agreement or otherwise made to the Bank
pursuant to this Agreement or any of the Financing Agreements shall be true,
complete and correct in all material respects.
3.1.5 EVENT OF DEFAULT. There shall exist no Event of
Default (or any event which with the giving of notice or the passage of time, or
both, would constitute an Event of Default).
SECTION 4. REPRESENTATIONS AND WARRANTIES.
In order to induce the Bank to enter into this Agreement and to make
the Term Loan hereunder, the Borrower represents and warrants to the Bank as
follows:
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4.1 ORGANIZATION.
4.1.1 The Borrower and each Subsidiary is a duly organized
and validly existing corporation in good standing under the laws of its
jurisdiction of incorporation with perpetual corporate existence and has all
requisite right, power and authority and all necessary licenses and permits to
own and operate its assets and properties and to carry on its business as now
conducted and as presently proposed to be conducted. The Borrower and each
Subsidiary has qualified and is in good standing as a foreign corporation in
each state or other jurisdiction where the nature of its business or the
ownership or use of its property requires such qualification, except such
jurisdictions, if any, in which the failure to be so qualified will not have a
material and adverse effect on either the conduct of its business or the
ownership of its properties.
4.1.2 SHL TeleMedicine Ltd., an Israeli company, owns,
indirectly, all of the issued and outstanding shares of capital stock of the
Borrower. Schedule 4.1.2 attached hereto correctly sets forth the chain of
ownership from SHL TeleMedicine Ltd. to the Borrower.
4.1.3 Borrower owns all of the issued and outstanding
shares of capital stock of Acquisition Corp.
4.1.4 As of the Closing Date, Borrower does not own any
equity interests, or possess any rights to obtain any equity interests, in any
entity other than its interest in Acquisition Corp. and Acquisition Corp.'s
rights under the Merger Agreement and the Stockholders Agreement (as defined in
the Merger Agreement).
4.2 AUTHORIZATION.
4.2.1 The Borrower has all requisite legal right, power and
authority to execute, deliver and perform the terms and provisions of this
Agreement, the Financing Agreements executed by it and all other instruments and
documents delivered by it pursuant hereto and thereto. The Borrower has taken or
caused to be taken all necessary action to authorize the execution, delivery and
performance of this Agreement, the Financing Agreements executed by it and any
other related agreements, instruments or documents delivered or to be delivered
by the Borrower pursuant hereto and thereto. This Agreement, the Financing
Agreements executed by the Borrower and all related agreements, instruments or
documents delivered or to be delivered pursuant hereto or thereto constitute and
will constitute legal, valid and binding obligations of the Borrower,
enforceable in accordance with their respective terms, subject to bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting the
enforcement of creditors' rights generally, and to the exercise of judicial
discretion in accordance with general principles of equity.
4.3 NO CONFLICTS. Neither the execution and delivery of this
Agreement, the Financing Agreements, or any of the instruments and documents
delivered or to be delivered pursuant hereto or thereto, by the Borrower, nor
the consummation of the transactions herein or therein contemplated, nor
compliance with the provisions hereof or thereof, will violate any law,
10
statute or regulation, or any order, writ or decree of any court or governmental
instrumentality, or will conflict with, or result in the breach of, or
constitute a default in any respect under, any indenture, mortgage, deed of
trust, agreement or other instrument to which the Borrower is a party, or by
which any of its properties may be bound or affected, or will result in the
creation or imposition of any lien, charge or encumbrance upon any of its
properties (except as contemplated hereunder or under the Financing Agreements)
or will violate any provision of the Certificate of Incorporation or By-Laws of
the Borrower, each as amended to date.
4.4 COMPLIANCE AND OTHER AGREEMENTS.
4.4.1 Neither the Borrower nor any Subsidiary is in default
under any indenture, mortgage, deed of trust, agreement or other instrument to
which it is a party, or by which it or any of its properties may be bound or
affected, except for such defaults which, individually or in the aggregate, will
not have a material and adverse effect on the business, operations, property or
assets or on the condition, financial or otherwise, of the Borrower or such
Subsidiary.
4.4.2 Neither the Borrower nor any Subsidiary is in default
with respect to any order, writ, injunction or decree of any court or of any
federal, state, municipal or other governmental department, commission, board,
bureau, agency or authority, domestic or foreign, or in violation of any law,
statute or regulation, domestic or foreign, to which it is, or any of its
properties are, subject, except for such defaults or violations which, in the
aggregate, will not have a material and adverse effect on the business,
operations, property or assets or on the condition, financial or otherwise, of
the Borrower or such Subsidiary. Without limitation to the foregoing, each of
the Borrower and Acquisition Corp. have made all filings with the Securities and
Exchange Commission that are required to be filed by it as of the Closing Date
to permit Acquisition Corp. to make a tender offer for the shares of Target
Corp., and Borrower and Acquisition Corp are in compliance in all material
respects with all such rules and regulations relating to the making of such
tender offer.
4.4.3 Neither the Borrower nor any Subsidiary is a party to
or bound by, nor are any of its properties bound or affected by, any agreement,
deed, lease or other instrument, or subject to any charter or other corporate or
partnership restriction or any judgment, order, writ, injunction, decree or
award, or any law, statute, rule or regulation, any of which materially and
adversely affects or in the future may (so far as the Borrower may now foresee)
materially and adversely affect the business, operations, prospects, properties
or assets, or the condition, financial or otherwise, of the Borrower or such
Subsidiary.
4.5 ERISA. The Borrower and each Commonly Controlled Entity are in
compliance in all material respects with all applicable provisions of ERISA.
Neither a Reportable Event nor a Prohibited Transaction has occurred and is
continuing with respect to any Plan; no notice of intent to terminate a Plan has
been filed nor has any Plan been terminated; no circumstances exist which
constitute grounds entitling the PBGC to institute proceedings to terminate, or
appoint a trustee to administrate, a Plan, nor has the PBGC instituted any such
proceedings; neither the
11
Borrower nor any Commonly Controlled Entity has completely or partially
withdrawn from a Multiemployer Plan; the Borrower and each Commonly Controlled
Entity have met their minimum funding requirements under ERISA with respect to
all of their Plans and the present fair market value of all Plan assets exceeds
the present value of all vested benefits under each Plan, as determined on the
most recent valuation date of the Plan and in accordance with the provisions of
ERISA and the regulations thereunder for calculating the potential liability of
the Borrower or any Commonly Controlled Entity to PBGC or the Plan under Title
IV of ERISA; and neither the Borrower nor any Commonly Controlled Entity has
incurred any liability to the PBGC under ERISA (other than for premiums under
Section 4007 of ERISA).
4.6 INVESTMENT COMPANY. The Borrower is not an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
4.7 APPROVALS AND CONSENTS. All authorizations, consents,
registrations, exemptions, approvals and licenses (governmental or otherwise) or
the taking of any other action (including, without limitation, by the
shareholders of the Borrower and any Subsidiary) which are required on the part
of Borrower as a condition to the validity or enforceability against the
Borrower of this Agreement, the Financing Agreements or any of the instruments
or documents delivered or to be delivered pursuant hereto or thereto, have been
effected or obtained and are in full force and effect.
4.8 REGULATION U; SECURITIES EXCHANGE ACT OF 1934. None of the
proceeds the Term Loan will be used, directly or indirectly, for the purpose of
(i) purchasing or carrying any margin stock or for any other purpose which might
constitute this transaction a "purpose credit" that violates or is inconsistent
with Regulation U, or (ii) extending credit to any Person for the purpose of
purchasing or carrying any such margin stock or for any other purpose that
violates, or is inconsistent with, Regulation X. The Borrower will not take, nor
will it permit any agent acting on its behalf to take, any action which might
cause this Agreement or any of the Financing Agreements to violate any
regulation of the Board of Governors of the Federal Reserve System or to violate
the Securities Exchange Act of 1934, in each case as in effect on the date
hereof or as amended hereafter.
4.9 USE OF FUNDS. The proceeds of the Term Loan shall be used to
acquire, through Acquisition Corp., shares of stock of Target Corp. pursuant to
the Merger Agreement.
4.10 TAXES. The Borrower has filed or caused to be filed all tax
returns required to be filed by it. Except as permitted by Section 5.3 hereof,
the Borrower has paid all taxes (including interest and penalties) as shown on
such returns or any assessment or notice of tax claim or deficiency received by
it to the extent that such taxes have become due. The Borrower has no knowledge
of any proposed material tax assessment against or affecting it and is not
otherwise obligated by any agreement, instrument or otherwise to contribute to
the payment of taxes owed by any other Person. All material tax liabilities are
adequately provided for or reserved against on the books of the Borrower in
accordance with IAS.
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4.11 LITIGATION. There are no actions, suits, investigations or
administrative proceedings of or before any court, arbitrator or governmental
authority, pending or threatened against the Borrower or any Subsidiary or their
respective properties or assets which (i) either in any case or in the
aggregate, if adversely determined, would materially and adversely affect the
business, operations, prospects, properties or assets or the condition,
financial or otherwise, of the Borrower or such Subsidiary, or (ii) question the
validity or enforceability of this Agreement, the Financing Agreements, or any
action to be taken in connection with the transactions contemplated hereby or
thereby.
4.12 DISCLOSURE. No certificate, statement, report or other
document furnished to the Bank by or on behalf of the Borrower in connection
herewith or in connection with any transaction contemplated hereby, or this
Agreement, or any Financing Agreement, contains any untrue statement of a
material fact or omits to state any material fact necessary in order to make the
statements contained therein not misleading.
SECTION 5. AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that, until all of the Obligations
are paid and satisfied in full, it shall comply, or cause compliance with, the
following covenants:
5.1 PRESERVATION OF EXISTENCE. The Borrower and each Subsidiary
shall preserve and maintain its corporate existence, rights, franchises and
privileges in the jurisdiction of its incorporation and will qualify and remain
qualified as a foreign corporation in each jurisdiction in which such
qualification is necessary or desirable in view of its business and operations
or in view of the ownership of its properties; provided that Acquisition Corp.
may merge into or consolidate with Target Corp.
5.2 MAINTENANCE OF INSURANCE. The Borrower and each Subsidiary
shall maintain at its expense, with financially sound and reputable insurers
reasonably acceptable to the Bank, insurance, with respect to its properties and
business, against loss or damage of the kinds and in the amounts as Borrower
determines reasonably and in good faith to be prudent in light of the risks
faced by its business.
5.3 PAYMENT OF TAXES. The Borrower and each Subsidiary shall pay
and discharge promptly all taxes (including, without limitation, all payroll
withholdings), assessments and governmental charges or levies imposed upon it or
upon its income or profits or upon any of its property, real, personal or mixed,
or upon any part thereof, before the same shall become in default; provided,
however, that neither the Borrower nor any Subsidiary shall be required to pay
any such tax, assessment, charge, levy or claim if the validity or amount
thereof shall be contested in good faith by proper proceedings and if the
Borrower or such Subsidiary shall have set aside on its books appropriate
reserves.
5.4 INSPECTION. The Borrower and each Subsidiary shall permit the
Bank to have one or more of its officers and employees, or any other Person
designated by the Bank, at the Bank's expense, visit and inspect any of the
properties of the Borrower and each Subsidiary and to
13
examine the minute books, books of account and other records of the Borrower and
each Subsidiary and to make copies thereof or extracts therefrom, and discuss
its affairs, finances and accounts with its officers and, at the request of the
Bank, with the Borrower's or such Subsidiary's independent accountants, in each
case upon the giving of reasonable advance notice and during normal business
hours and at such other reasonable times and as often as the Bank may reasonably
desire.
5.5 ACCOUNTING; FINANCIAL STATEMENTS AND OTHER INFORMATION.
The Borrower and each Subsidiary shall maintain a system of
accounting established and administered in accordance with IAS and will set
aside on its books all such proper reserves for each fiscal year for
depreciation, obsolescence, amortization, bad debts and other purposes as shall
be required by IAS. The Borrower shall deliver, or cause to be delivered, to the
Bank:
5.5.1 As soon as practicable following the end of each
fiscal quarter of the Borrower, but in any event not later than 75 days
thereafter, an unaudited consolidated and consolidating balance sheet of the
Borrower as at the end of such quarter and the related consolidated and
consolidating statements of income, stockholders equity and cash flows of the
Borrower for such quarter, all in reasonable detail and satisfactory in scope to
the Bank, setting forth for each such period in comparative form the
corresponding figures for the appropriate period of the preceding fiscal year,
which statements shall be prepared in accordance with IAS and, subject to normal
year-end adjustments, present fairly the financial position of the Borrower as
at the end of the period involved;
5.5.2 As soon as practicable after the end of each fiscal
year of the Borrower, and in any event within 120 days thereafter, a
consolidated and consolidating balance sheet of the Borrower as at the end of
such fiscal year and the related statements of income, stockholders equity and
cash flows of the Borrower for such year, all in reasonable detail and
satisfactory in scope to the Bank, setting forth in each case in comparative
form the corresponding figures for the preceding fiscal year, which statements
shall be prepared in accordance with IAS and audited, in the case of the
consolidated statements, by independent certified public accountants of
recognized standing selected by the Borrower and acceptable to the Bank;
5.5.3 Promptly upon receipt thereof, copies of all
financial reports (including, without limitation, management letters, if any)
submitted to the Borrower and/or any Subsidiary by its auditors, in connection
with each annual or interim audit or review of its books by such auditors;
5.5.4 Promptly upon the issuance thereof, copies of all
reports, if any, sent to the Securities and Exchange Commission or any other
governmental agency or any securities exchange by the Borrower or any
Subsidiary, and all reports, notices or statements sent by the Borrower or any
Subsidiary to the holders of any indebtedness for money borrowed of the Borrower
or such Subsidiary or to the trustee under which the same is issued;
14
5.5.5 (i) Concurrently with the delivery of the financial
statements required to be furnished pursuant to Sections 5.5.1 through 5.5.2
hereof, a certificate signed by the chief executive officer or chief financial
officer of the Borrower, stating (a) that a review of the activities of the
Borrower and the Subsidiaries during such period has been made under his
immediate supervision with a view to determining whether the Borrower has
observed, performed and fulfilled all of its obligations under this Agreement,
and (b) that there existed during such period no Event of Default (or any event
which with the giving of notice or the passage of time, or both, would become an
Event of Default) or if any such Event of Default (or event) did exist,
specifying the nature thereof, the period of existence thereof and what action
the Borrower or Subsidiary proposes to take, or has taken, with respect thereto;
and (ii) promptly upon the occurrence of any Event of Default, a certificate
signed by the chief executive officer or chief financial officer of the Borrower
specifying the nature thereof and the action the Borrower proposes to take or
have taken with respect thereto;
5.5.6 With reasonable promptness, such other information
respecting the business, operations and financial condition of the Borrower and
any Subsidiary as the Bank may reasonably from time to time request;
5.5.7 Immediately upon becoming aware of any development or
other information which may materially and adversely affect the properties,
business, prospects, profits or condition (financial or otherwise) of the
Borrower or any Subsidiary or the ability of the Borrower to perform or comply
with this Agreement or to pay any of the Obligations, telephonic or telegraphic
notice specifying the nature of such development or information and such
anticipated effect; and
5.5.8 Within ninety (90) days from the Closing Date, the
Borrower shall deliver to the Board a pro forma consolidated and consolidating
balance sheet, dated as of the Closing Date, prepared in accordance with IAS
that gives pro forma effect to the transactions contemplated by the Merger
Agreement.
5.6 COMPLIANCE. The Borrower and each Subsidiary will comply with
the requirements of all applicable laws, rules, regulations, orders of any
governmental authority, and all agreements to which it is a party, the
noncompliance with which laws, rules, regulations, orders and agreements would
materially adversely affect the business, operations, prospects or assets, or
the condition, financial or otherwise, of the Borrower or such Subsidiary.
5.7 ERISA. Each of the Borrower and any Commonly Controlled Entity
shall maintain compliance in all material respects with the applicable
provisions of ERISA. The Borrower will deliver to the Bank, promptly after the
filing or receiving thereof, copies of all reports, including annual reports and
notices, which the Borrower or any Commonly Controlled Entity files with or
receives from the PBGC or the U.S. Department of Labor under ERISA with respect
to any Plan; and as soon as possible and in any event within 30 days after the
Borrower knows or has reason to know that any Reportable Event or Prohibited
Transaction has occurred with respect to any Plan or that the PBGC or the
Borrower or any Commonly Controlled Entity has instituted or will institute
proceedings under Title IV of ERISA to terminate any Plan, the
15
Borrower will deliver to the Bank a certificate of the chief executive officer
or chief financial officer of the Borrower setting forth the details as to such
Reportable Event or Prohibited Transaction or Plan termination and the action
the Borrower proposes to take with respect thereto.
5.8 CHANGE IN BUSINESS. The Borrower shall not make any material
change in the character of its business as carried on at the date hereof.
5.9 NOTIFICATION TO BANK. The Borrower shall promptly notify the
Bank of (i) any Event of Default hereunder, (ii) any event, condition or act
which with the giving of notice or the passage of time, or both, would
constitute an Event of Default hereunder, (iii) any litigation or proceedings
that are instituted or threatened (to the knowledge of the Borrower) against the
Borrower or any Subsidiary or any of their respective assets, and (iv) each and
every default by the Borrower or any Subsidiary under any obligation for
borrowed money which would permit the holder of such obligation to accelerate
its maturity, including the names and addresses of the holders of such
obligation and the amount thereof, in each case describing the nature thereof
and the action the Borrower proposes to take with respect thereto.
5.10 FURTHER ASSURANCES. The Borrower shall duly execute and
deliver, or will cause to be duly executed and delivered, such further
instruments and documents, and will do or use its commercially reasonable best
efforts to cause to be done such further acts as may be reasonably necessary or
proper in the Bank's opinion to effectuate the provisions or purposes of this
Agreement and the Financing Agreements.
SECTION 6. INTENTIONALLY OMITTED.
SECTION 7. EVENTS OF DEFAULT/REMEDIES.
7.1 EVENTS OF DEFAULT. The occurrence of any one or more of the
following events shall constitute an "Event of Default":
7.1.1 The Borrower shall fail to pay the principal of, or
interest on, the Term Note, or any other fee or charge payable under this
Agreement or under any Financing Agreement, as and when due and payable.
7.1.2 If a default shall be made by the Borrower in the
performance or observance of, or shall occur under, any covenant, agreement or
provision contained in Sections 5.2, 5.3, 5.5, 5.6 or 5.7 of this Agreement, and
such default shall continue for a period of fifteen (15) days after notice to
the Borrower setting forth the specific default or defaults; or
16
7.1.3 If a default shall be made by the Borrower in the
performance or observance of, or shall occur under, any covenant, agreement or
provision contained in this Agreement (other than as described in Sections 7.1.1
or 7.1.2 above) or any other agreement between the Bank and the Borrower; or if
this Agreement or any Financing Agreements shall terminate, be terminable or be
terminated or become void or unenforceable for any reason whatsoever without the
prior written consent of the Bank; or
7.1.4 If a default shall occur in the payment of any
principal, interest or premium with respect to any indebtedness for borrowed
money or any obligation which is the substantive equivalent thereof (including,
without limitation, obligations under conditional sales contracts, finance
leases and the like) of the Borrower or any Subsidiary, or under any agreement
or instrument under or pursuant to which any such indebtedness or obligation may
have been issued, created, assumed, guaranteed or secured by the Borrower or any
Subsidiary, in the aggregate amount in excess of $100,000, and such default
shall continue for more than the period of grace, if any, therein specified, or
if any such indebtedness shall be declared due and payable prior to the stated
maturity thereof; or
7.1.5 If any representation, warranty or other statement of
fact made by or on behalf of the Borrower in this Agreement or in any Financing
Agreement or in any writing, certificate, report or statement at any time
furnished to the Bank pursuant to or in connection with this Agreement or any
Financing Agreements or otherwise, shall be false or misleading in any material
respect when given; or
7.1.6 If the Borrower or any Subsidiary shall be unable to
pay its debts generally as they become due; file a petition to take advantage of
any insolvency act; make an assignment for the benefit of its creditors;
commence a proceeding for the appointment of a receiver, trustee, liquidator or
conservator of itself of a whole or any substantial part of its property; file a
petition or answer seeking reorganization or arrangement or similar relief under
the federal bankruptcy laws or any other applicable law or statute of the United
States of America or any state or of any foreign government; or
7.1.7 If a court of competent jurisdiction shall enter an
order, judgment or decree appointing a custodian, receiver, trustee, liquidator
or conservator of the Borrower or any Subsidiary or of the whole or any
substantial part of their respective properties, or approve a petition filed
against the Borrower or any Subsidiary seeking reorganization or arrangement or
similar relief under the federal bankruptcy laws or any other applicable law or
statute of the United States of America or any state or of any foreign
government; or if, under the provisions of any other law for the relief or aid
of debtors, a court of competent jurisdiction shall assume custody or control of
the Borrower or any Subsidiary or of the whole or any substantial part of their
respective properties; or if there is commenced against the Borrower or any
Subsidiary any proceeding for any of the foregoing relief and such proceeding or
petition remains undismissed for a period of 60 days; or if the Borrower or any
Subsidiary by any act indicates its consent to or approval of any such
proceeding or petition; or
17
7.1.8 If (i) any judgment, remaining unpaid, unstayed or
undismissed for a period of 30 days is rendered against the Borrower or any
Subsidiary which by itself or together with all other such judgments rendered
against the Borrower or any Subsidiary remaining unpaid, unstayed or undismissed
for a period of 30 days is in excess of $100,000, or (ii) there is any
attachment or execution against the Borrower's or any Subsidiary's properties
remaining unstayed or undismissed for a period of 30 days which by itself or
together with all other attachments and executions against the Borrower's or any
Subsidiary's properties remaining unstayed or undismissed for a period of 30
days is for an amount in excess of $100,000; or
7.1.9 If the Borrower or any Subsidiary shall suspend or
have suspended (voluntarily or involuntarily and for whatever reason) the
operation of a material portion of its business for a period of 20 days; or
7.1.10 Any of the following events shall occur or exist with
respect to the Borrower or any Commonly Controlled Entity under ERISA with
respect to a Plan; any Reportable Event shall occur; complete or partial
withdrawal from any Multiemployer Plan shall take place; any Prohibited
Transaction shall occur; a notice of intent to terminate a Plan shall be filed,
or a Plan shall be terminated; or circumstances shall exist which constitute
grounds entitling the PBGC to institute proceedings to terminate a Plan, or the
PBGC shall institute such proceedings to terminate a Plan; and in each case
above, such event or condition, together with all other events or conditions, if
any, could subject the Borrower or any Subsidiary to any tax, penalty, or other
liability which in the aggregate may exceed $100,000; or
7.1.11 Any change in the condition or affairs (financial or
otherwise) of the Borrower or any Subsidiary shall occur which, in the Bank's
reasonable opinion, increases the risk with respect to the Term Loan; or
7.1.12 If SHL TeleMedicine Ltd., an Israeli company, shall at any
time cease to own, directly or indirectly, 100% of the issued and outstanding
shares of capital stock of the Borrower; or
7.1.13 If the Borrower shall cease to own, directly or indirectly,
all of the shares of Target Corp. acquired by Acquisition Corp. after the
Closing Date (or following the merger contemplated by the Merger Agreement, all
of the shares of the surviving corporation); or following consummation of the
tender offer contemplated by the Merger Agreement, the Borrower shall cease to
have the right, directly or indirectly through its interest in Acquisition Corp,
to nominate and elect a majority of the directors of Target Corp. The Event of
Default set forth in this Section 7.1.13 shall not apply so long as any shares
of Target Corp. (or following the merger contemplated by the Merger Agreement,
any of the shares of the surviving corporation), directly or indirectly owned by
the Borrower, are deemed "margin stock" within the meaning of Regulation U.
7.2 REMEDIES. Upon the occurrence of any one or more of such
Events of Default, the Bank may, at its option, without presentment for payment,
demand, notice of dishonor or notice of protest or any other notice, all of
which are hereby expressly waived by the Borrower,
18
declare the Term Loan to be due and payable together with interest at the
default rate specified in this Agreement or the Term Note; provided, however,
that if such event is an event specified in Section 7.1.6 or 7.1.7, then the
Term Loan shall automatically become due and payable together with interest at
the default rate specified in this Agreement or the Term Note. The Bank shall
have all of the rights and remedies set forth in this Agreement and the
Financing Agreements, and in any instrument or document referred to herein or
therein, and under any other applicable law relating to this Agreement or the
Financing Agreements. The Bank may, at its option, cure any default by the
Borrower under any agreement with a third party which constitutes, or would with
notice or lapse of time or both constitute, an Event of Default hereunder, and
may add the amount expended in such cure to the Obligations and charge the
Borrower's account therefor, such amounts to be repayable by the Borrower on
demand; the Bank shall be under no obligation to effect such cure and shall not
by making any payment for the Borrower's account be deemed to have assumed any
obligation or liability of the Borrower.
SECTION 8. MISCELLANEOUS.
8.1 EXPENSES. The Borrower, whether or not the transactions
contemplated hereby are consummated, shall pay to the Bank, or reimburse the
Bank for, all out-of-pocket expenses incurred by the Bank in connection with the
preparation, administration and enforcement of this Agreement, the Financing
Agreements, all other agreements, instruments and documents executed and
delivered in connection herewith and therewith, and the transactions
contemplated hereunder and thereunder, together with any amendments,
supplements, consents or modifications which may be hereafter made or entered
into in respect thereof, including, but not limited to, filing fees, expenses
for searches, and the reasonable fees and disbursements of counsel to the Bank.
The Bank is hereby authorized to charge any amounts payable hereunder directly
to the account(s) of the Borrower maintained with the Bank.
8.2 SURVIVAL OF AGREEMENT. All agreements, representations and
warranties contained herein or made in writing by the parties hereto in
connection with the transactions contemplated hereby shall survive the execution
and delivery of this Agreement, the Financing Agreements and the consummation of
the transactions contemplated herein or therein regardless of any investigation
made by or on behalf of the Bank.
8.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise, and no
delay in exercising on the part of the Bank, any right, power or privilege under
this Agreement or under any of the Financing Agreements or other documents
referred to herein or therein shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, power or privilege hereunder or
thereunder preclude any other or further exercise thereof or the exercise of any
other right, power and privilege. The rights and remedies of the Bank hereunder
and under the Financing Agreements and under any other present and future
agreements between the Bank and the Borrower are cumulative and not exclusive of
any rights or remedies provided by law, or under any of said Financing
Agreements or agreements and all such rights and remedies may be exercised
successively or concurrently.
8.4 NOTICES AND DELIVERIES.
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8.4.1 MANNER OF DELIVERY. Except as otherwise expressly
provided in this Agreement, all notices, communications and materials to be
given or delivered pursuant to this Agreement or any of the Financing Agreements
shall be given or delivered in writing (which shall include telecopy
transmissions).
8.4.2 ADDRESSES. All notices, communications and materials
to be given or delivered pursuant to this Agreement or any of the Financing
Agreements shall be given or delivered at the following respective addresses and
telecopier numbers and to the attention of the following individuals or
departments:
(i) if to the Borrower, to it at:
SHL TELEMEDICINE NORTH AMERICA, INC.
Lasa, Xxxxxxx & Veve
0000 X Xxxxxx, X.X., Xxxxx 000
Xxxxxxxxxx, XX 00000
Telecopier No.: (000)-000-0000
Attention: Xxxxx Xxxxxxxxxx
(ii) if to the Bank, to it at:
Bank Leumi USA
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000)-000-0000
Attention: Xxxxxxxx Xxxxx, Senior Vice President
or at such other address or telecopier number or to the attention of such other
individual or department as the party to which such information pertains may
hereafter specify for the purpose in a notice to the other specifically
captioned "Notice of Change of Address".
8.4.3 EFFECTIVENESS. Each notice and communication and any
material to be given or delivered pursuant to this Agreement or any of the
Financing Agreements shall be deemed so given or delivered (i) if sent by
registered or certified mail, postage prepaid, return receipt requested, on the
third Business Day after such notice, communication or material, addressed as
above provided, is delivered to a United States post office and a receipt
therefor is issued thereby, (ii) if sent by any other means of physical
delivery, when such notice, communication or material is delivered to the
appropriate address as above provided, (iii) if sent by telecopier, when such
notice, communication or material is transmitted to the appropriate telecopier
number as above provided and is received at such number, PROVIDED HOWEVER, that
in each of the foregoing cases notices of change of address, or telecopier
number shall not be deemed given until received.
20
8.5 AMENDMENTS AND WAIVERS. Neither this Agreement, nor any of the
Financing Agreements or any other instrument or document referred to herein or
therein may be changed, waived, discharged or terminated orally, except by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought.
8.6 APPLICABLE LAW. This Agreement and the Financing Agreements
and any other document referred to herein or therein and the obligations of the
parties hereunder or thereunder are being executed and delivered in New York,
New York and shall be construed and interpreted in accordance with the laws of
the State of New York applied to agreements entered into and performed therein.
8.7 SUCCESSORS. This Agreement, the Financing Agreements and any
other document referred to herein or therein shall be binding upon and inure to
the benefit of and be enforceable by the parties and their respective heirs,
successors and assigns, except that the Borrower may not assign its rights under
this Agreement, the Financing Agreements and any other document referred to
herein or therein without the prior written consent of the Bank.
8.8 PARTIAL INVALIDITY. If any provision of this Agreement or the
Financing Agreements is held to be invalid or unenforceable, such invalidity or
unenforceability shall not invalidate this Agreement or the Financing Agreements
as a whole but this Agreement or the particular Financing Agreement, as the case
may be, shall be construed as though it did not contain the particular provision
or provisions held to be invalid or unenforceable and the rights and obligations
of the parties shall be construed and enforced only to such extent as shall be
permitted by law.
8.9 HEADINGS AND WORD MEANINGS. The headings used herein are for
convenience only and do not constitute matters to be considered in interpreting
this Agreement. The words "herein," "hereinabove," "hereof," and "hereunder,"
when used anywhere in this Agreement, refer to this Agreement as a whole and not
merely to a subdivision in which such words appear, unless the context otherwise
requires. The singular shall include the plural, the masculine gender shall
include the feminine and neuter and the disjunctive shall include the
conjunctive, and vice versa, unless the context otherwise requires.
8.10 WAIVER OF JURY TRIAL. THE PARTIES HERETO HEREBY WAIVE TRIAL BY
JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR
ARISING OUT OF THIS AGREEMENT, THE FINANCING AGREEMENTS OR ANY AGREEMENT,
INSTRUMENT OR DOCUMENT DELIVERED PURSUANT HERETO OR THERETO, OR THE VALIDITY,
PROTECTION, INTERPRETATION, ADMINISTRATION, COLLECTION OR ENFORCEMENT HEREOF OR
THEREOF, OR ANY OTHER CLAIM OR DISPUTE HEREUNDER OR THEREUNDER.
8.11 JURISDICTION; SERVICE OF PROCESS. THE BORROWER HEREBY
IRREVOCABLY CONSENTS TO THE JURISDICTION OF THE SUPREME COURT OF THE STATE OF
NEW YORK FOR THE COUNTY OF NEW YORK, AND THE UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF NEW YORK IN
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CONNECTION WITH ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE FINANCING AGREEMENTS OR ANY AGREEMENT, DOCUMENT OR INSTRUMENT
DELIVERED PURSUANT HERETO OR THERETO. IN ANY SUCH LITIGATION, BORROWER WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS AND AGREES THAT THE
SERVICE THEREOF MAY BE MADE BY CERTIFIED MAIL DIRECTED TO IT AT ITS ADDRESS SET
FORTH HEREIN, OR DESIGNATED IN WRITING PURSUANT TO, THIS AGREEMENT OR IN ANY
OTHER MANNER PERMITTED BY THE RULES OF EITHER OF SAID COURTS.
8.12 INDEMNITY. The Borrower hereby agree to defend, indemnify, and
hold the Bank harmless from and against any and all claims, damages,
investigations, judgments, penalties, costs and expenses (including attorney
fees and court costs now or hereafter arising from the aforesaid enforcement of
this clause) arising directly or indirectly from the activities of the Borrower,
and each Subsidiary, their respective predecessors in interest, or third parties
with whom either has a contractual relationship, their respective use of
proceeds of the Term Loan, or arising directly or indirectly from the violation
of any environmental protection, health, or safety law, whether such claims are
asserted by any governmental agency or any other Person. This indemnity shall
survive termination of this Agreement.
8.13 MARSHALLING; RECOURSE TO SECURITY; PAYMENTS SET ASIDE. The
Bank shall not be under any obligation to marshal any assets in favor of the
Borrower or any other party or against or in payment of any or all of the
Obligations of the Borrower to the Bank hereunder or under the Financing
Agreements or otherwise. Recourse to security shall not be required at any time.
To the extent that the Borrower makes a payment or payments to the Bank, or the
Bank exercises its rights of set-off, and such payment or payments or the
proceeds of such set-off or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then, to the extent of such
recovery, the obligation or part thereof originally intended to be satisfied,
and all liens, rights and remedies therefor, 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.
8.14 SET-OFF. In addition to any rights and remedies of the Bank
now or hereafter provided by law, the Bank shall have the right, without prior
notice to the Borrower, any such notice being expressly waived by the Borrower
to the extent permitted by applicable law, on the occurrence and during the
continuation of any Event of Default to set off and apply against any
Obligation, whether matured or immature, of the Borrower any amount owing from
the Bank to the Borrower, at or at any time after the happening of any such
Event of Default, and such right of set-off may be exercised by the Bank against
the Borrower or against any trustee in bankruptcy, debtor-in-possession,
assignee for the benefit or creditors, receiver, or execution, judgment or
attachment creditor of any of them, notwithstanding the fact that such right of
set-off shall not have been exercised by the Bank before the making, filing or
issuance, or service on the Bank, of, or of notice of, any such event or
proceeding.
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8.15 COUNTERPARTS; FACSIMILE SIGNATURE. This Agreement may be executed
in counterparts, each of which shall constitute an original but all of which
when taken together shall constitute but one contract, and shall become
effective when copies hereof which, when taken together, bear the signatures of
each of the parties hereto shall be delivered to the Bank. Delivery of an
executed counterpart of a signature page to this Agreement by telecopier shall
be effective as delivery of a manually executed signature page hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed and delivered as of the day and year first above written.
SHL TELEMEDICINE NORTH AMERICA, INC.
By: /s/
---------------------------------
Name:
Title:
BANK LEUMI USA
By: /s/
---------------------------------
Name:
Title:
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EXHIBIT A
TERM NOTE
FOR VALUE RECEIVED, the undersigned, SHL TELEMEDICINE NORTH
AMERICA, INC., a Delaware corporation ("the Borrower"), PROMISES TO PAY to the
order of BANK LEUMI USA (the "Bank") at its office at 000 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, or at such other place as may be designated by the holder
hereof in writing, the principal sum of TWENTY FOUR MILLION ($24,000,000.00)
DOLLARS, in two installments, the first installment to be in the amount of
$5,000,000 and to be due and payable on the first anniversary of this Term Note,
and the second and final installment to be in the remaining outstanding
principal balance of this Term Note and to be due and payable on the second
anniversary of this Term Note.
Interest on the outstanding principal sum of this Term Note
shall be payable at the rates and at the times provided in that certain Loan
Agreement, dated the date hereof, between the Borrower and the Bank (the "Loan
Agreement").
This Term Note is the Term Note referred to in, and is
entitled to the benefits of, the Loan Agreement. The Loan Agreement, among other
things, contains provisions for acceleration of the maturity of this Term Note
upon the happening of certain stated events that are specified in the Loan
Agreement.
The Borrower hereby waives presentment, demand for payment,
notice of protest and all other demands in connection with the delivery,
acceptance, performance, default or enforcement of this Term Note.
This Term Note shall be governed by the laws of the State of
New York without giving effect to its choice of law provisions. No amendment,
modification or waiver of any provision of this Term Note nor consent to any
departure by the Borrower therefrom shall be effective unless the same shall be
in writing and signed by the Bank and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.
Dated as of: April 2, 0000
XXX XXXXXXXXXXXX XXXXX XXXXXXX, INC.
By:
---------------------------------
Name:
Title:
