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Exhibit 10.6
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REIMBURSEMENT AND LETTER OF CREDIT AGREEMENT
Dated as of June 1, 1989
Among
WEST PLAINS MANOR,
NATIONAL HEALTHCORP L.P.
and
THE BANK OF TOKYO, LTD.
NEW YORK AGENCY
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THE INDUSTRIAL DEVELOPMENT AUTHORITY
OF THE CITY OF WEST PLAINS, MISSOURI
VARIABLE RATE DEMAND INDUSTRIAL DEVELOPMENT BONDS
(WEST PLAINS MANOR PROJECT) 1986 SERIES
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Table of Contents
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Page
ARTICLE I DEFINED TERMS..................................................2
ARTICLE II REIMBURSEMENT; FEE; SECURITY; AND PAYMENTS.....................5
2.1 Reimbursement..............................................5
2.2 Fee........................................................6
2.3 Payments in Respect of Increased Costs.....................7
2.4 Security for Reimbursement Obligation
2.5 Payments...................................................8
ARTICLE III LETTER OF CREDIT COMMITMENT; CONDITIONS
PRECEDENT TO ISSUANCE OF LETTER OF CREDIT;
REINSTATEMENT..................................................9
3.1 Letter of Credit Commitment................................9
3.2 Conditions Precedent to Issuance of
Letter of Credit...........................................9
3.3 Reinstatement.............................................11
ARTICLE IV REPRESENTATIONS AND WARRANTIES; COVENANTS
AND OTHER AGREEMENTS..........................................12
4.1 Representations and Warranties............................12
4.2 Affirmative Covenants of the Guarantor and
Company...................................................14
4.3 Negative Covenants of the Company.........................18
4.4 No Waiver of Right of Set-off.............................18
4.5 Indemnification...........................................18
4.6 Continuing Obligation; Obligation Absolute................19
4.7 Transfer of Letter of Credit..............................20
4.8 Liability for Acts and Omissions With
Respect to Letter of Credit...............................20
4.9 Insolvency of Bank........................................20
ARTICLE V DEFAULTS AND REMEDIES.........................................21
5.1 Events of Default.........................................21
5.2 No Waiver; Remedies Cumulative............................22
ARTICLE VI MISCELLANEOUS.................................................22
6.1 Costs, Expenses And Taxes.................................22
6.2 Severability..............................................23
6.3 Governing Law.............................................23
6.4 Headings..................................................23
6.5 Notices and Addresses for Notices.........................23
6.6 Counterparts..............................................23
6.7 No Recourse Against Company...............................24
6.8 Jurisdiction..............................................24
6.9 ParticiPations............................................24
Exhibit: A - Form of Letter of Credit
B - Form of Pledge Agreement
C - Form of Guaranty
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REIMBURSEMENT AND LETTER OF CREDIT AGREEMENT
REIMBURSEMENT AND LETTER OF CREDIT AGREEMENT dated as of June 1, 1989
among WEST PLAINS MANOR, a Missouri limited partnership (the "Company"),
NATIONAL HEALTHCORP L.P., a Delaware limited partnership (the "Guarantor"), and
THE BANK OF TOKYO, LTD., NEW YORK AGENCY, a New York agency of a Japanese
banking corporation (the "Bank").
WHEREAS:
A. The Industrial Development Authority of the City of West Plains,
Missouri (the "Issuer") has issued pursuant to the Indenture of Trust dated as
of February 1, 1986 (the "Indenture") between the Issuer and The Merchants Bank,
Kansas City, Missouri, as trustee (the "Trustee"), $3,200,000 principal amount
of its Variable Rate Demand Industrial Development Bonds (West Plains Manor
Project) 1986 Series (the "Bonds"); and
B. the proceeds from the sale of the Bonds have been used by the Issuer
and the Company to refund a previous issue of bonds issued in connection with
acquiring, constructing, installing and equipping a nursing home facility in
West Plains, Missouri owned by the Company (the "Project"); and
C. the Company and the Issuer entered into a Loan Agreement dated as of
February 1, 1986 providing for a loan from the Issuer to the Company of the
proceeds of the Bonds to refinance the Project as aforesaid, and pursuant to
which among other things, the Company has furnished an Irrevocable Letter of
Credit No. S013243 dated March 13, 1986 (the "Original Letter of Credit") issued
by Commerce Union Bank to the Trustee and a Confirmation Letter No. 110 LCX
957580 dated March 13, 1986 (the "Confirming Letter of Credit") issued by the
Bank to the Trustee for the account of the Company; and
D. the Company has requested the Bank to substitute for the Original
Letter of Credit and the Confirming Letter of Credit its Irrevocable Letter of
Credit in the form of Exhibit A to this Agreement (the "Letter of Credit") in
favor of the Trustee, in the stated amount set forth in Section 3.1 hereof; and
E. the Company, the Guarantor and the Bank desire to specify the
reimbursement obligations of the Company and the Guarantor, and the conditions
to the issuance of the Letter of Credit.
NOW, THEREFORE, in consideration of the premises and in order to induce
the Bank to issue the Letter of Credit, and intending to be legally bound
hereby, the Company, the Guarantor and the Bank hereby agree as follows:
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ARTICLE I
DEFINED TERMS
The following terms shall have the meanings provided below.
"Affiliate" means, as to any Person, any other Person which controls,
is controlled by, or is under common control with, such Person.
"Agreement" means this Reimbursement and Letter of Credit Agreement
dated as of June 1, 1989 among the Company, the Guarantor and the Bank.
"Bank" means The Bank of Tokyo, Ltd., New York Agency, New York, New
York.
"Bond Counsel" means ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇ ▇▇▇▇, Kansas
City, Missouri.
"Bonds means the Issuer's $3,200,000 principal amount Variable Rate
Demand Industrial Development Bonds (West Plains Manor Project) 1986 Series.
"Business Day" means a day on which banks located in the city in which
the principal corporate trust office of the Trustee is located and banks located
in New York City are not required or authorized by law to remain closed and on
which the New York Stock Exchange is not closed.
"Cash Flow" means net income plus depreciation plus non-cash
amortization plus management fees, all determined on the basis of generally
accepted accounting principles consistently applied. "
"Collateral Shortfall" means the excess of (A) the aggregate principal
amounts outstanding (net of debt service reserve funds, if any) under the Bonds,
over (B) the product of eight (8) multiplied by the Company's Cash Flow,
determined semi-annually, at the end of each of the Company's second and fourth
fiscal quarters, in each case for the immediately preceding six-month period.
"Company" means West Plains Manor, a Missouri limited partnership, and
its successors and assigns.
"Consolidated" refers to the consolidation in accordance with generally
accepted accounting principles of the accounts of the Guarantor and those
Affiliates which are consolidated in accordance with generally accepted
accounting principles.
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"Date of Issuance" means the date of issuance and delivery by the Bank
of the Letter of Credit.
"Debt Service Ratio" means the ratio of (A) the sum of net income plus
current interest expense plus depreciation to (B) the sum of current principal
plus interest expense plus management fees, with respect to the Project, all
determined in accordance with generally accepted accounting principles
consistently applied.
"Event of Default" has the meaning set forth in Section 5.1 hereof.
"Collateral" means any intermediate care nursing home facility or
facilities owned and operated by the Guarantor or a wholly-owned subsidiary of
the Guarantor, the value of which as collateral hereunder is defined to be the
amount by which (A) the average number of occupied beds in such facility over
the preceding twelve (12) months, multiplied by $25,000, exceeds (B) the
outstanding amount of funded indebtedness which is secured by existing liens on
that facility.
"Guarantor" means National HealthCorp, L.P., a Delaware limited
partnership, and its successors and assigns.
"Guaranty" means the Guaranty Agreement between the Guarantor and the
Bank in the form attached hereto as Exhibit C.
"Hazardous Substance" and "Hazardous Substance Laws" have the meaning
set forth in Section 4.5 hereof.
"Indenture" means the Indenture of Trust dated as of February 1, 1986
constituting a trust agreement between the Issuer and the Trustee, as the same
may be duly amended or supplemented in accordance with the provisions thereof.
"Issuer" means The Industrial Development Authority of the City of West
Plains, Missouri and its successors and assigns.
"Letter of Credit" means the Bank's Letter of Credit to be issued in
the form of Exhibit A to this Agreement.
"Letter of Credit" means the Bank's commitment to issue the Letter of
Credit in the Stated Amount.
"Loan Agreement" means the Loan Agreement dated as of February l, 1986
between the Issuer and the Company, and any amendments or supplements thereto.
"Mortgage" means the First Amended and Restated Deed of Trust and
Security Agreement with Collateral Assignment of Rents
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and Leases dated as of February 1, 1986 from the Issuer to the Trustee and the
Bank granting a first mortgage lien on and security interest in the real and
other property of and related to the Project.
"Mortgaged Property" has the meaning defined in the Mortgage.
"New York Paying Agent" means The Bank of Tokyo Trust Company, as
Paying Agent under the Indenture.
"Participant" means any bank or financial institution to which the Bank
or any Participant has granted a participation in the Letter of Credit.
"Permitted Encumbrances" have the meaning defined in the Indenture.
"Person" means and includes an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization and a government
or any department or agency thereof.
"Pledge Agreement" means the Pledge and Security Agreement of even date
herewith in the form of Exhibit B hereto between the Guarantor and the Bank.
"Pledged Bonds" means Bonds delivered to and at the time held by the
Bank pursuant to the Pledge Agreement following or in connection with any "C
Drawing" or "E Drawing", as defined in Section 2.1(d) hereof.
"Prime Rate" means the rate of interest per annum determined from time
to time by the Bank as its prime rate, any change in the Prime Rate to take
effect on the date specified in the announcement of such change.
"Project" means the Project as defined in the Indenture.
"Remarketing Agent" means the Remarketing Agent appointed in accordance
with the Indenture, presently, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Incorporated.
"Stated Amount" means the Stated Amount of the Letter of Credit as
provided in Section 3.1 hereof, subject to such irrevocable reduction as
provided in Section 3.3(c) hereof.
"Termination Date" means the date on which the Trustee s right to draw
under the Letter of Credit terminates, determined in accordance with its terms.
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"Trustee" means The Merchants Bank, Kansas City, Missouri, the Trustee
under the Indenture or any successor thereto as trustee appointed pursuant to
the Indenture.
"Underwriter" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Incorporated.
The terms "hereof," "hereby, "hereto," "hereunder" and similar terms
mean this Agreement, and the term "heretofore" means before, and the term
"hereafter" means after, the effective date hereof. For all purposes of this
Agreement, unless the context shall otherwise indicate, words used in the
singular number shall include the plural and vice versa.
ARTICLE II
REIMBURSEMENT; FEE; SECURITY; AND PAYMENTS
Section 2.1 Reimbursement.
The Company and the Guarantor, jointly and severally, hereby agree to
pay to the Bank the following amounts in the manner and at the times set forth
below:
(a) On demand following the date of any "A Drawing" or "B Drawing", as
hereinafter defined, but not later than the Termination Date, the Company and
the Guarantor shall pay to the Bank, (i) an amount equal to the total amounts
drawn under the Letter of Credit plus (ii) interest on such amounts from the
date of the related drawing to the date of payment of the amount of such drawing
at an interest rate per annum equal to two percent (2%) above the Prime Rate,
provided that if any such amount is not paid when due, it shall thereafter bear
interest at the Prime Rate plus three percent (3%) per annum.
(b) In case of any "C Drawing" or "E Drawing", as hereinafter defined,
on or before the Termination Date, the Guarantor and the Company shall pay to
the Bank (i) an amount equal to the total amounts drawn under the Letter of
Credit pursuant to any "C Drawing", "D Drawing", "E Drawing", or "F Drawing",
each as hereinafter defined, to pay the purchase price of Bonds tendered to the
Remarketing Agent, the New York Paying Agent, or the Trustee, plus (ii) interest
on such amounts from the date of the related drawing to the date of payment of
the amount of such drawing at an interest rate per annum equal to the Prime Rate
for the first ninety (90) days and the Prime Rate plus one half of one percent
(1/2%) thereafter; provided that if any such amount is not paid when due, it
shall thereafter bear interest at the Prime Rate plus three percent (3%) per
annum.
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(c) On demand, the Company and the Guarantor shall pay to the Bank any
and all reasonable charges and expenses which the Bank may pay or incur relative
to the Letter of Credit.
(d) As used in this Agreement, (i) PA Drawing n means any drawing under
the Letter of Credit with respect to principal on any Bonds other than Pledged
Bonds, (ii) "B Drawing" means any drawing under the Letter of Credit with
respect to interest on any Bonds other than Pledged Bonds, (iii) "C Drawing"
means any drawing under the Letter of Credit with respect to payment of the
portion of the purchase price corresponding to principal on any Pledged Bonds
delivered to the Remarketing Agent pursuant to Section 1.01(f)(i) or (iii) of
the Indenture, (iv) "D Drawing" means any drawing under the Letter of Credit
with respect to payment of the portion of the purchase price corresponding to
interest on any Bonds referred to in the immediately preceding clause (iii), (v)
"E Drawing" means any drawing under the Letter of Credit with respect to payment
of the portion of the purchase price corresponding to principal on any Pledged
Bonds delivered to the Trustee or the New York Paying Agent pursuant to Section
1.01(f)(ii) of the Indenture, and (vi) "F Drawing" means any drawing under the
Letter of Credit with respect to payment of the portion of purchase price
corresponding to interest on any Bonds referred to in the immediately preceding
clause (v).
(e) The amount of each payment of interest hereunder shall be
calculated on the basis of the actual number of days elapsed and a 360-day year.
No interest shall be payable on drawings which are reimbursed on or prior to
3:00 P.M. (New York City time) on the day on which such drawings are made.
(f) The Bank shall open and maintain on its books a Reimbursement
Account and shall debit such Reimbursement Account with the amount of each
drawing and accrued interest thereon and shall credit such Reimbursement Account
for each payment hereunder. The records of the Bank with respect to the
Reimbursement Account shall be prima facie evidence in the absence of manifest
error of the reimbursement obligation of the Company and the Guarantor hereunder
and accrued interest thereon and all payments made by the Company or the
Guarantor with respect thereto.
Section 2.2 Fee. The Guarantor and the Company hereby agree to pay to
the Bank a fee with respect to the Letter of Credit from the Date of Issuance,
as reasonable compensation to the Bank for issuing the Letter of Credit, as
follows: quarterly in arrears on March 1, June 1, September 1 and December 1 in
each year that the Letter of Credit is outstanding and on the Termination Date
(each such date, a "payment date"), a facility fee in an amount equal to 1% per
annum of the average daily Stated Amount of the Letter of Credit during the
period begining
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on the previous payment date (or, in the case of the first payment, beginning on
the Date of Issuance) and ending on the date next preceding the applicable
payment date, calculated on the basis of a 360-day year for actual days elapsed.
Section 2.3 Payments in Respect of Increased Costs. If any change in
any law or regulation or in the interpretation thereof by any court or
administrative or governmental authority charged with the administration thereof
applicable to the Bank or any Participant shall (i) impose, modify or deem
applicable any reserve, special deposit, capital adequacy or similar requirement
against letters of credit issued by the Bank or participation therein by a
Participant, or (ii) impose on the Bank or any Participant any other condition
regarding this Agreement or the Letter of Credit, or (iii) subject the Bank or
any Participant to any tax (other than taxes based upon gross revenues or
income), and the result of any event referred to in clause (i), (ii) or (iii)
above shall be to increase the cost to the Bank or any Participant of issuing or
maintaining the Letter of Credit or any participation therein (which increase in
cost shall be the result of a reasonable allocation of the aggregate of such
cost increases resulting from such events), or to reduce the amount of
principal, interest or any fee or compensation to be paid to the Bank or any
Participant in respect of this Agreement or the Letter of Credit; then, upon
demand by the Bank, the Company and the Guarantor shall immediately pay to the
Bank, from time to time as specified by the Bank, additional amounts which shall
be sufficient to compensate the Bank or a Participant for such increased cost or
reduction relating to the Letter of Credit from the date of such change,
together with interest on each such amount from the date demanded until payment
in full thereof at the rate specified in Section 2.1(a) hereof. A certificate
setting forth in reasonable detail such increased cost or reduction incurred by
the Bank or any Participant as a result of any event mentioned in clause (i),
(ii) or (iii) above, submitted by the Bank to the Company, shall be prima facie
evidence, absent manifest error, as to the amount thereof. The obligations of
the Company and the Guarantor under this Section 2.3 shall survive the
termination of this Agreement.
Section 2.4 Security for Reimbursement Obligation.
(a) As security for payment of the obligations of the Company pursuant
to Section 2.1(a) hereof or otherwise hereunder, the Company will (i) amend and
restate the existing mortgage on the Project including the Bank as an equal and
ratable beneficiary with the Trustee, the priority of which shall be confirmed
by a mortgagee title insurance policy, ALTA Form 8-1970, subject only to
exceptions other than Permitted Encumbrances, all of which the Bank must have
consented to in writing; (ii) grant a security interest in all machinery,
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equipment, furniture, fixtures, and furnishings owned by the Company and located
at any time on the Project site, and all contract rights of the Company relating
to the Project; and (iii) grant an assignment of any and all rents and leases
relating to the Project. In addition, (x) the reimbursement obligations of
Company shall be unconditionally guaranteed by Guarantor pursuant to the
Guaranty, and (y) the Guarantor will from time to time grant or cause its
Affiliates to grant, for the benefit of the Bank and the Issuers, a second
priority mortgage or deed of trust lien in Excess Collateral valued at 130% of
the amount of any Collateral Shortfall at such times during which a Collateral
Shortfall exists.
(b) Bonds purchased with the proceeds of a "C Drawing" and "E Drawing"
under the Letter of Credit will be deemed to have been purchased by the
Guarantor, and the Guarantor will forthwith deliver or cause to be delivered to
the Bank such Bonds to be held in pledge under the terms of the Pledge
Agreement. As security for payment of the obligations of the Company to the Bank
pursuant to Section 2.1(b) hereof or otherwise hereunder, the Guarantor hereby
grants to the Bank a first priority lien and security interest in the Pledged
Bonds so delivered.
(c) As security for the payment of the obligations of the Company and
the Guarantor pursuant to Section 2.1 and otherwise hereunder, the Company
hereby grants to the Bank a lien on moneys or instruments (at such times as they
become payable to the Company under the Indenture) which the Company has an
interest in or title to pursuant to the Indenture, now or hereafter held in the
Bond Fund (as such term is defined in the Indenture) or otherwise by the Trustee
under any provision of the Indenture and in the right of the Company to receive
any such money or instruments. The Bank hereby confirms that such lien is and
shall be junior and subordinate to the lien on such moneys in favor of the
Trustee for the Bond holders.
Section 2.5 Payments. All payment by the Company or the Guarantor to
the Bank under this Agreement shall be made in lawful currency of the United
States in immediately available funds at the Bank office at ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, Attention: National Banking Department. In the case of payments
of the obligations under Section 2.1, such payments shall be accompanied by a
written advice stating whether such payment is to reimburse the Bank for a
drawing which was applied to the payment of the purchase price of a Bond, the
principal of a Bond or interest on a Bond. In the event that the date specified
for any payment hereunder is not a Business Day, such payment shall be made not
later than the next following Business Day and interest shall be paid at the
rate provided for herein on any such payment to the Business Day on which such
payment is made.
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ARTICLE III
LETTER OF CREDIT COMMITMENT; CONDITIONS
PRECEDENT TO ISSUANCE OF LETTER OF CREDIT; REINSTATEMENT
Section 3.1 Letter of Credit Commitment. (a) Subject to the terms and
conditions of this Agreement, the Bank agrees to issue the Letter of Credit in
the Stated Amount when issued of $3,261,546 and with an initial Termination Date
of July 10, 1995. The Stated Amount consists of a principal portion of
$3,200,000 which may be drawn upon with respect to the payment of unpaid
principal amount or the portion of purchase price corresponding to principal of
the Bonds and an interest portion in an amount not exceeding $61,546 which may
be drawn upon with respect to the payment of up to 54 days' accrued interest (at
an assumed rate of 13% per annum, calculated on the basis of a year of 365 days
or the portion of purchase price corresponding to accrued interest on the Bonds
on or prior to their maturity date.
(b) At the request of the Company, during the 30-day period following
December 1 of the year prior to the Termination Date then in effect, the Bank
may at its option extend the term of the Letter of Credit for an additional two
year period beyond the Termination Date then in effect, or for such other period
as the Company and the Bank shall agree upon at the time of such extension. Any
such extension shall be deemed to extend the term of the Letter of Credit upon
the same terms and conditions as shall then be in effect, except as the Company
and the Bank shall otherwise agree and subject to the terms and conditions of
the Indenture. Any such date to which the term of the Letter of Credit shall be
extended shall, from and after the date of such extension, constitute the
Termination Date then in effect for all purposes of this Agreement and the
Letter of Credit.
Section 3.2 Conditions Precedent to Issuance of Letter of Credit. It
shall be a condition precedent to the issuance by the Bank of the Letter of
Credit that:
(a) the Bank shall have received on or before the Date of Issuance the
following, each dated such date, in form and substance satisfactory to the Bank:
(i) copies of the Certificates of Limited Partnership and
Partnership Agreements of the Company and the Guarantor, and of organizational
action of the Company and the Guarantor, as appropriate, authorizing the
execution, delivery and performance of this Agreement, the Pledge Agreement and
the Guaranty, certified by appropriate officials or representatives of the
Company and the Guarantor, as appropriate;
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(ii) true and correct copies of all governmental approvals
necessary for the Issuer to issue the Bonds and execute and deliver the
Indenture;
(iii) an opinion of Counsel to the Company and the
Guarantor, satisfactory in form and substance to the Bank, regarding the matters
set forth in paragraphs (a), (b), (c) and (d) of Section 4.1 hereof;
(iv) an opinion of Bond Counsel and Counsel to the Issuer
as to such matters as the Bank may reasonably request;
(v) the Guaranty, duly executed by the Guarantor and the
Bank;
(vi) an executed copy (or a duplicate thereof) of the
Indenture;
(vii) executed copies of this Agreement, the Pledge
Agreement and the Mortgage;
(viii) certificates of the appropriate officials or
representatives of the Company and the Guarantor certifying the name and true
signatures of the officers of the Company and the Guarantor authorized to sign
this Agreement, the Pledge Agreement, the Guaranty, and the other documents to
be delivered by the Company and the Guarantor hereunder;
(ix) evidence of the valid creation and perfection of the
liens and security interests referred to in Section 2.4(a) hereof;
(x) evidence that (A) the Company is insured under a
public liability insurance policy against bodily injury and property damage,
with limits of no less than $500,000 for each occurrence and $1,000,000, if
reasonably available, but in no event less than $500,000 aggregate liability,
and (B) the Project is insured against loss or damage by fire, lightning,
windstorm, explosion and smoke damage, in an amount not less than the full
insurable value of the Project, with all such insurance policies referred to in
this clause (xi) naming Trustee and Bank as co-insureds;
(xi) a mortgagee's title insurance policy insuring the
priority of the lien of the Mortgage, subject to no exceptions other than for
current year's taxes, and Permitted Encumbrances;
(xii) such other documents, instruments, approvals (and, if
requested by the Bank, certified duplicates of executed copies thereof) or
opinions as the Bank may reasonably request.
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(b) The following statements shall be true and correct on the Date of
Issuance and the Bank shall have received a certificate signed by a duly
authorized official of the Company and the Guarantor, as appropriate, dated the
Date of Issuance, stating that:
(i) the representations and warranties contained in
Section 4 of this Agreement are correct on and as of the Date of Issuance as
though made on and as of such date; and
(ii) no Event of Default has occurred and is continuing,
or would result from the issuance of the Letter of Credit, and no event has
occurred and is continuing which would constitute any such Event of Default but
for the requirement that notice be given or time elapse or both.
(c) On the Date of Issuance:
(i) the Indenture shall be in full force and effect; and
(ii) no change or prospective change in law or regulation,
or any interpretation thereof by any court or administrative banking or
governmental authority charged or claiming to be charged with the administration
thereof applicable to the Bank or the Bonds or change in circumstances affecting
the market for tax-exempt securities has occurred, which in the opinion of the
Bank, would have any effect described in Section 2.3 hereof or would materially
increase the risk to the Bank with respect to payments under this Agreement or
the security therefor.
Section 3.3 Reinstatement.
(a) Upon reimbursement in full of the Bank with respect to Pledge Bonds
following a "C Drawing" or "E Drawing" under the Letter of Credit as applicable,
the obligation of the Bank to honor demands for payment under the Letter of
Credit with respect to the payment of principal or the portion of the purchase
price corresponding to principal of Bonds will be reinstated by an amount equal
to the aggregate principal amount of such Bonds, provided that such
reinstatement shall not cause the amount of the Letter of Credit Commitment to
exceed the Stated Amount.
(b) Following any "B Drawing", "D Drawing" or "F Drawing" on the Letter
of Credit, the obligation of the Bank to honor demands for payment under the
Letter of Credit for interest, or portion of purchase price corresponding to
interest, on the Bonds will be immediately reinstated to an amount equal to
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54 days' accrued interest on the proportionate amount of principal of the Bonds.
(c) The obligation of the Bank to honor demands for payment under the
Letter of Credit for principal shall not be reinstated following any "A Drawing"
on the Letter of Credit.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES; COVENANTS
AND OTHER AGREEMENTS
Section 4.1 Representations and Warranties. The Company and Guarantor
represent and warrant as follows:
(a) Organization. The Company has been duly organized and validly
exists under the laws of the State of Missouri, the Guarantor has been duly
organized and validly exists under the laws of the State of Delaware, and the
Company and Guarantor are authorized to transact business under the laws of the
State of Missouri.
(b) No Conflict. The execution and delivery of this Agreement, the
Pledge Agreement, the Mortgage and the Guaranty, and the performance by the
Company and the Guarantor, as appropriate of their obligations under the
aforementioned, do not and will not violate the Certificates of Limited
Partnership or Partnership Agreements of the Company or the Guarantor, as
appropriate, or any court order by which the Company or the Guarantor, as
appropriate, is bound, and such actions do not and will not constitute a default
under any agreement, indenture, mortgage, lease, note or other obligation or
instrument material to the Company or the Guarantor, as appropriate, to which
the Company or Guarantor is a party and no approval or other action by any
governmental authority or agency is required in connection therewith.
(c) Enforceability. This Agreement, the Pledge Agreement, the Mortgage
and the Guaranty, when executed and delivered by the Company or the Guarantor,
as appropriate, will be legal, valid and binding obligations of the Company or
the Guarantor, as appropriate, enforceable in accordance with their respective
terms (assuming due and valid authorization, execution and delivery of this
Agreement, the Pledge Agreement, the Mortgage and the Guaranty by other parties
thereto), except to the extent the binding effect and enforceability of the
agreement and instruments referred to above are subject to applicable
bankruptcy, insolvency, reorganization, moratorium and other laws in effect from
time to time affecting the rights of creditors
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generally and that the enforceability thereof may be limited by the application
of general principles of equity.
(d) Litigation. To the knowledge of the Company and the Guarantor,
there is no action, suit, proceeding, inquiry or investigation, at law or in
equity, or before or by any state or federal court or any governmental agency,
body or official, pending or threatened against or affecting the Company or the
Guarantor, as appropriate, the probable outcome of which would materially
adversely affect the ability of the Company or the Guarantor, as appropriate, to
perform its obligations under this Agreement, the Pledge Agreement, the Mortgage
or the Guaranty, or which, in any way, would adversely affect the validity or
enforceability of the Bonds, the Indenture, this Agreement, the Pledge
Agreement, the Mortgage or the Guaranty or any agreement or instrument to which
the Company is a party used or contemplated for use in the consummation of the
transactions contemplated by this Agreement, the Pledge Agreement, the Mortgage
or the Guaranty.
(e) Investment Activities. The Company is not engaged principally, or
as one of the Company's important activities, in the business of extending
credit for the purpose of purchasing or carrying margin stock (within the
meaning of Regulation U of the Board of Governors of the Federal Reserve
System), and will not use the proceeds of any loan hereunder so as to violate
Regulation U as it may be amended or interpreted from time to time by the Board
of Governors of the Federal Reserve System.
(f) Financial Statements. The Consolidated balance sheet of the
Guarantor as at September 30, 1988 and the related Consolidated statements of
income and retained earnings and changes in financial position of the Guarantor
for the fiscal year then ended, certified by its independent public accountants,
copies of which have been furnished to the Bank, fairly present, the
Consolidated financial condition of the Guarantor as at such date and the
Consolidated results of the operations of the Guarantor for the periods ended on
such date all in accordance with generally accepted accounting principles, and
since the date thereof there has been no material adverse change in such
condition or results of operations. The Guarantor does not have any material
contingent obligations, liabilities for taxes, long-term leases or unusual
forward or long-term commitments, which are not reflected in the foregoing
financial statements (and the related notes thereto) or have not been disclosed
in writing to the Bank.
(g) ERISA. The Company and the Guarantor are in substantial compliance
in all material respects with the applicable provisions of ERISA and the
regulations and published interpretations thereunder, and the Company and the
Guarantor
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have not failed to comply with any such provision, regulation or interpretation
which would subject the Company or the Guarantor to any material tax or penalty.
No Reportable Event (as defined in Section 4043(b) of Title IV of ERISA) has
occurred with respect to any pension plan which might constitute grounds for a
termination of, and no proceedings have been instituted by the Company or the
Guarantor to withdraw from or to terminate, any pension plan as to which the
Company or the Guarantor may have any material liability.
(h) Environmental. The Mortgaged Property is presently in substantial
compliance with all applicable Hazardous Substance Laws relating to or affecting
the Mortgaged Property (including but not limited to, the discharge or removal
of any Hazardous Substances from the Mortgaged Property) and there is not now
pending or to the knowledge of the Mortgagor threatened any action, suit,
investigation or proceeding against the Mortgagor or the Mortgaged Property, or
against any other party relating to the Mortgaged Property, seeking to enforce
any right or remedy under any applicable Hazardous Substance Laws.
(i) Disclosure. There are no facts that the Company and the Guarantor
have failed to disclosure to the Bank that, individually or in the aggregate,
materially adversely affect or, as far as the Company and the Guarantor can
foresee, will materially adversely affect the business, properties, operations
or condition (financial or otherwise) or prospects of the Company or the
Guarantor.
Section 4.2 Affirmative Covenants of the Guarantor and Company. So long
as the Termination Date has not occurred or any amount is due or owing to the
Bank hereunder, the Company and the Guarantor agree, unless the Bank shall
otherwise consent in writing, as follows:
(a) Notice of Default. The Company and Guarantor will give prompt
notice in writing to the Bank of the occurrence of any Event of Default or the
occurrence of any event which with notice or the passage of time or both would
give rise to an Event of Default.
(b) Financial Reporting.
(i) The Guarantor will provide to the Bank, not less than
120 days following the end of its fiscal year, financial statements, including a
balance sheet, income statement, and sources and uses of funds statement, which
financial statements shall be audited and prepared in accordance with generally
accepted accounting principles. In addition, the Guarantor will provide the
Bank, not less than 45 days following the end of each quarter in its fiscal year
(other than the final
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quarter thereof), its quarterly reports on Form 10-Q or its interim financial
statements, including a balance sheet, income and sources and uses of funds
statement; such quarterly statement may be unaudited, but shall be prepared to
the extent feasible in accordance with generally accepted accounting principles
and shall be certified as accurate by a responsible officer. In addition, the
Guarantor shall furnish the Bank not more than 45 days following the end of each
calendar quarter, with quarterly operating statements on the Project, certified
by a responsible officer to the best of his knowledge as accurate.
(ii) The Guarantor shall promptly, from time to time,
furnish to the Bank such information regarding the business, operations and
financial condition of the Guarantor as the Bank may reasonably request.
(c) Provision of Excess Collateral. Upon the request of the Bank, the
Guarantor will provide the Bank, for the ratable benefit of itself and the Bond
holders, with Excess Collateral acceptable to the Bank, whenever there shall
exist a Collateral Shortfall. The Bank agrees that it will not accept any
additional collateral, including but not limited to Excess Collateral, for the
obligations of Company and Guarantor hereunder, unless the same shall be held
and pledged for the ratable benefit of the Bank and the Bond holders.
(d) Compliance with Bond Documents. The Company and the Guarantor will
comply in all respects with all covenants applicable to them contained in the
Bonds, the Indenture, and other documents executed by the Guarantor or the
Company in connection therewith.
(e) Insurance. The Company will maintain the insurance required by
Section 3.02 of the Loan Agreement and to name the Bank as an assured. The
Company will deliver to the Bank annually broker s reports of the respective
insurers stating that such insurance is in force and effect.
(f) ERISA Compliance. The Company and the Guarantor will maintain each
of its pension plans or programs as to which it may have liability in compliance
in all material respects with the applicable provisions of ERISA and the
regulations and published interpretations thereunder the failure to comply with
which could subject the Company or the Guarantor to a tax or penalty which might
have material adverse effect on its financial condition.
(g) Remarketing Agent. If the Remarketing Agent ceases to act or fails
within 90 days to effect the remarketing
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of the Bonds, the Company and the Guarantor will at the direction of the Bank
retain a new Remarketing Agent.
(h) Environmental. The Company and the Guarantor each shall use its
best efforts to comply with, and ensure substantial compliance by all tenants or
occupants of the Mortgaged Property, with all applicable Hazardous Substance
Laws relating to or affecting the Mortgaged Property, and the Company and the
Guarantor each shall use its best efforts to keep the Mortgaged Property free
and clear of any liens imposed pursuant to any applicable Hazardous Substance
Laws, all at the Mortgagor's sole cost and expense.
(i) Financial Covenants. The Guarantor shall comply with the following
financial covenants, with determination of compliance being made quarterly.
(i) Current Ratio. The Guarantor shall at all times
maintain a "Current Ratio" of at least 1.5 to 1. "Current Ratio" shall
be defined as the ratio of current assets to current liabilities.
(ii) Working Capital. The Guarantor shall at all times
maintain a minimum "Working Capital. level of $10,000,000. "Working
Capital shall be defined as current assets less current liabilities.
(iii) Funded Debt to Adjusted Tangible Net Worth Ratio. The
Guarantor shall at all times maintain a "Funded Debt" to "Adjusted
Tangible Net Worth" ratio of no more than:
3.5 to 1 for the period from the Date of Issuance - until December 31,
1989;
3.0 to 1 for the period following until June 30, 1990;
2.75 to 1 for the period following until December 31, 1990;
2.5 to 1 for the period thereafter until the Termination Date;
"Funded Debt" is defined as long term debt, but excluding subordinated
debt, notes payable, current maturities of long term debt, plus
capitalized and operating leases, plus all guaranties; and "Adjusted
Tangible Net Worth" is defined as total equity of the Guarantor, plus
approximately $15,745,000 in deferred income resulting from the profit
on the sale of nursing home properties as equity (which amount shall
decrease in accordance with
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the Guarantor's books and records that comply with generally accepted
accounting principles), plus subordinated debt, minus good will and
unamortized loan costs in excess of $1,400,000.
(iv) Tangible Net Worth. The Guarantor shall at all times maintain
the following minimum Tangible Net Worth requirements for the
following periods:
$35,200,000 from the Date of Issuance through June
29, 1989;
$36,400,000 from June 30, 1989 through September 29,
1989;
$37,600,000 from September 30, 1989 through December
30, 1989;
$40,000,000 from December 31, 1989 through March 30,
1990;
On March 31, 1990 and on subsequent calendar quarter
endings, the minimum Tangible Net Worth requirements
will increase $1,400,000 per quarter on a cumulative
basis.
"Tangible Net worth" is defined as total equity of the Guarantor, plus
subordinated debt, minus good will and unamortized loan costs in excess
of $1,400,000.
(v) Debt Service Coverage. The Guarantor shall at all times
maintain a minimum "Debt Service Coverage" of 1.3 to 1. "Debt
Service Coverage" is defined as the ratio of (A) the annualized sum of
net income, plus depreciation/ amortization, plus interest expense, minus
distributions paid to holders of units of the Guarantor for the fiscal
year as projected by the Guarantor in written financial projections
furnished to Bank or as actually paid, whichever is greater to (B)
interest expense, plus current maturities of long term debt, plus any
payments required to fund any guaranty obligations of the Guarantor.
(j) Further Assurances. From time to time the Company and the Guarantor
will execute and deliver such additional documents and perform such other acts
as may be necessary or appropriate to carry out the intent of this Agreement and
the Indenture, including but not limited to documents necessary to create or
perfect, or continue the perfection of, the liens on the Project and on any
Excess Collateral. The Company and the Guarantor hereby authorize and empower
the Bank to file and
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financing or continuation statement of any amendments thereto with respect to
any security pledged or assigned to the Bank in accordance with the Uniform
Commercial Code of the States of Missouri or Tennessee or any other applicable
jurisdiction without the signature of the Company and the Guarantor.
Section 4.3 Negative Covenants of the Company. So long as the
Termination Date has not occurred or any amount is due or owing to the Bank
hereunder, unless the Bank shall otherwise consent in writing, the Company
agrees not to enter into or consent to any amendments of, or accept the benefits
of, any waivers of any provisions of the Loan Agreement, the effect of which
would be to (i) relieve the Company of any duty or responsibility to maintain or
preserve the condition of the Project or any part thereof, (ii) diminish or
modify any right or power of the Trustee or the Bank with respect to inspection
of the Project or receipt of the proceeds of sale or condemnation of the Project
or of insurance proceeds payable upon damage to or destruction of the Project,
(iii) impair or jeopardize the continuing perfection of any lien on or security
interest in the Project or any part thereof.
Section 4.4 No Waiver of Right of Set-off. Except as explicitly stated
in this Section 4.4, nothing contained in this Agreement shall be deemed to
waive or limit in any manner the Bank's right to set off any or all deposits at
any time held, and any other indebtedness at any time owing by the Bank to or
for the credit or the account of the Company or the Guarantor, against any and
all obligations of the Company or the Guarantor now or hereafter existing in
respect of the reimbursement obligations of the Company or the Guarantor
hereunder.
Section 4.5 Indemnification. (a) The Company and the Guarantor hereby
indemnify and hold harmless the Bank and any Participant from and against any
and all claims, damages, losses, liabilities, costs and expenses whatsoever
(including attorneys fees) which the Bank or any Participant may incur (or which
may be claimed against the Bank or any Participant by any person or entity
whatsoever) by reason of or in connection with (a) the execution and delivery or
transfer of, or payment or failure to pay under, the Letter of Credit, or (b)
the issuance and sale of the Bonds; provided, that the Company and the Guarantor
shall not be required to indemnify the Bank or any Participant for any claims,
damages, losses, liabilities, costs or expenses to the extent, but only to the
extent, caused by (i) the willful misconduct or gross negligence of the Bank in
determining whether a document presented under the Letter of Credit complies
with the terms thereof, or (ii) the Bank s willful or grossly negligent failure
to pay under the Letter of Credit after the presentation to it by the Trustee
(or a successor trustee under the Indenture to whom the Letter of Credit has
been transferred in accordance
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with its terms) of a document complying with the terms and conditions of the
Letter of Credit.
(b) The Company and the Guarantor hereby indemnify and hold harmless
the Bank and any Participant from and against any and all claims, damages,
losses, liabilities, including strict liability, injuries, costs and expenses,
including reasonable attorneys' fees, costs of any settlement or judgment and
claims of any and every kind whatsoever paid, incurred or suffered by, or
asserted against, the Bank or any Participant by any person or entity or
governmental agency for, with respect to or as a result of, the presence on or
under, or the escape, seepage, leakage, spillage, discharge, emission,
discharging or release from, the Mortgaged Property of any Hazardous Substance.
For purposes of this Agreement, "Hazardous Substances" mean and include those
elements or compounds which are contained in the list of hazardous substances
adopted by the United States Environment Protection Agency ("EPA", or by any
agency of the State of Missouri ("State Agency") or the list of toxic pollutants
designated by Congress, the EPA or the State Agency or which are defined as
hazardous, toxic, pollutant, infectious or radioactive by any other Federal,
state or local statute, law, ordinance, code, rule, regulation, order or decree
regulating, relating to, or imposing liability or standards of conduct
concerning, any hazardous, toxic or dangerous waste, substance or material, as
now or any time hereafter in effect (for purposes of this Agreement, the
"Hazardous Substance Laws").
Section 4.6 Continuing Obligation; Obligation Absolute. This Agreement
is a continuing obligation and shall (a) be binding upon the Company and the
Guarantor, their successors and assigns, and (b) inure to the benefit of and be
enforceable by the Bank and its successors, transferees and assigns; provided,
that the Guarantor may not assign all or any part of this Agreement without the
prior written consent of the Bank, and provided further that any assignee of the
Company must, as a condition precedent to such assignment, assume in writing all
obligations of Company hereunder. The obligations of the Company and the
Guarantor under this Agreement, the Guaranty and the Pledge Agreement shall be
paid or performed strictly in accordance with the terms hereof and the Guaranty
and the Pledge Agreement, under all circumstances whatsoever, and shall be
absolute, irrevocable, and unconditional and shall not be subject to any right
of set-off or counterclaim arising from any breach by the Bank or any other
Person of any obligation to the Company or the Guarantor of any nature
whatsoever. The obligations of Company and the Guarantor to indemnify the Bank
as set forth in Section 4.5 hereof shall be continuing in nature and shall
survive the termination of the Letter of Credit and the reimbursement of the
Bank with respect to all amounts as to which
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the Company or the Guarantor is required to reimburse the Bank hereunder.
Section 4.7 Transfer of Letter of Credit. The Letter of Credit may be
transferred to a successor trustee in accordance with the provisions set forth
therein, and shall terminate as set forth therein.
Section 4.8 Liability for Acts and Omissions With Respect to Letter of
Credit. The Company and the Guarantor assume all risks of the acts or omissions
of the Trustee and any transferee of a Letter of Credit with respect to its use
thereof. Neither the Bank nor any of its officers, directors or employees shall
be liable or responsible for: (a) the use which may be made of the Letter of
Credit by, or any acts or omissions of the Trustee and any transferee in
connection therewith; (b) the validity, sufficiency, accuracy or genuineness of
documents, or of any endorsement(s) thereon, even if such documents should in
fact prove to be in any or all respects invalid, insufficient, fraudulent or
forged; or (c) any other circumstances whatsoever in making or failing to make
payment under the Letter of Credit, except only that the Company having made the
payments hereunder shall have a claim against the Bank and the Bank shall
thereupon be liable to the Company to the extent, but only to the extent of
damages suffered by the Company which were caused by (i) the Bank's willful
misconduct or gross negligence in determining whether documents presented under
the Letter of Credit comply with the terms thereof or (ii) the Bank's willful or
grossly negligent failure to pay under the Letter of Credit after the
presentation to it by the Trustee (or a successor trustee under the Indenture to
whom the Letter of Credit has been transferred in accordance with its terms) of
a document complying with the terms and conditions of the Letter of Credit. In
furtherance and not in limitation of the foregoing, (i) the Bank may accept
documents that appear on their face to be in order, without responsibility for
further investigation, regardless of any notice or information received to the
contrary (other than an order of a court having jurisdiction in the premises),
(ii) the Bank may but shall not be required to accept documents which
substantially or otherwise reasonably comply with the terms of the credit, (iii)
the Company and the Guarantor waive any tests of literal or strict construction
as regards acceptability of documents, (iv) the Bank in the absence of bad faith
may honor drafts or documents otherwise in order which may be signed by any
purported administrator, successor, receiver, or transferee by operation of law
for the Trustee, and (v) the Bank may but shall not be required to honor drafts
which fail to bear any or adequate reference to the Letter of Credit.
Section 4.9 Insolvency of Bank. The Bank agrees promptly to notify the
Trustee in the event that the Bank should
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be declared insolvent or placed into receivership (or consent to such
receivership) by the Superintendent of Banks of the State of New York, any
successor thereof, or any other state or federal regulatory agency or authority
having jurisdiction over the Bank.
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.1 Events of Default. Unless waived by the Bank pursuant to
Section 5.2 hereof, any of the following shall constitute an Event of Default
hereunder:
(a) any representation or warranty made by the Company or the Guarantor
herein, or in any certificate, financial or other statement furnished by the
Company or the Guarantor pursuant to this Agreement shall prove to have been
untrue or incomplete in any material respect when made; or
(b) the Company or the Guarantor shall fail to pay when due any amount
specified in Article II hereof; or
(c) if, for any reason (other than release by the Bank), the Pledge
Agreement, the Mortgage or the Guaranty shall cease to be in full force and
effect or if the Company shall assert that it is not liable under the Pledge
Agreement or the Mortgage, or the Guarantor shall assert that it is not liable
under the Guaranty; or
(d) the breach by the Company or the Guarantor of any other term or
provision of this Agreement, the Pledge Agreement or the Guaranty which is not
remedied for 30 days after written notice from the Bank to the Company or the
Guarantor; or
(e) the occurrence of a default in the payment when due (subject to
applicable grace periods) of any indebtedness of the Company, the Guarantor, or
an Affiliate; or
(f) an "Event of Default" shall occur and be continuing under and as
described in Section 8.01 of the Indenture; or
(g) the loss and/or failure by the Company to obtain or maintain any
requisite licenses respecting the Project within 180 days of a final
determination that the same are required or that a deficiency exists in the
requirements for maintaining the same; or
(h) a material contract or payment default by Company or Guarantor; or
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(i) material default by either party under, or material amendment of,
the management agreement dated as of February 1, 1986 between the Company and
the Guarantor; or
(j) failure of the Company to reflect on the operating statements with
respect to the Project delivered pursuant to Section 4.2(b), a Debt Service
Ratio of at least 1.0 to 1.0; or
(k) the granting or imposition of any lien or security interest in any
collateral securing the Company's obligations hereunder, other than in favor of
the Bank and the. Trustee under the Mortgage and the Indenture.
Upon the occurrence of an Event of Default hereunder, the Bank may, in its sole
discretion, but shall not be obligated to, by notice to the Company and the
Guarantor (i) declare an amount equal to the maximum liability of the Bank under
the Letter of Credit, and all other amounts payable hereunder by the Company and
the Guarantor to be forthwith due and payable, and the same shall thereupon
become immediately payable without demand, presentment, protest or further
notice of any kind, all of which are hereby expressly waived, (ii) notify the
Trustee in writing of the occurrence of such Event of Default, and (iii) pursue
any other remedy permitted to the Bank under this Agreement, the Indenture, the
Mortgage, the Pledge Agreement or the Guaranty, or at law or in equity. The Bank
may apply all monies recovered through the exercise of its remedies to the
payment of the reimbursement and other payment obligations of the Company and
the Guarantor under this Agreement in such order and priority as determined by
the Bank in its sole and exclusive judgment.
Section 5.2 No Waiver, Remedies Cumulative. No failure by the Bank to
exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other further exercise thereof or the exercise of any other right.
No waiver hereunder shall be valid unless in writing signed by the parties
hereto. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
ARTICLE VI
MISCELLANEOUS
Section 6.1 Costs, Expenses And Taxes. The Company and the Guarantor
agree to pay on demand all costs and expenses incurred by the Bank in connection
with the preparation, execution, delivery, and administration of this Agreement
and any other documents which may be delivered in connection with this Agreement
and all costs and expenses, if any, in connection with the enforcement of this
Agreement and such other documents which
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may be delivered in connection with this Agreement, including, without
limitation, the reasonable fees and out-of-pocket expenses of counsel for the
Bank with respect thereto and with respect to advising the Bank as to its rights
and responsibilities under this Agreement. In addition, the Company and the
Guarantor shall pay any and all recording and other taxes and fees payable or
determined to be payable in connection with the execution, delivery, filing and
recording of this Agreement and such other documents and agrees to save the Bank
harmless from and against any and all liabilities with respect to or resulting
from any delay in paying or omission to pay such taxes and fees.
Section 6.2 Severability. Any provision of this Agreement which is
prohibited, unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or non-authorization without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of such
provision in any other jurisdiction.
Section 6.3 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York.
Section 6.4 Headings. Section headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
Section 6.5 Notices and Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing and, if to the
Company, mailed or delivered to West Plains Manor, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, with a copy to the Guarantor and to ▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, Esq., ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇; if to the
Guarantor, mailed or delivered to ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇; and if to the Bank, mailed or delivered to it, addressed to it at ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attn: National Banking Department, or as to
each party at such other address as shall be designated by such party in a
written notice to the other party. All such notices and other communications
shall, when mailed, be effective three days after the date of deposit in the
mails, addressed as aforesaid.
Section 6.6 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be regarded as the original and all of which
shall constitute one and the same Agreement.
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Section 6.7 No Recourse Against Company. No partners of the Company,
whether general partners, limited partners, additional partners, or substituted
partners (collectively the "Partners"), shall have any liability for payments
due under, arising out of or in connection with this Agreement, except for the
obligations of the Company to indemnify the Bank as set forth in Section 4.5(b)
hereof with respect to which the Bank shall have full recourse to the Partners.
In the event that the Company shall become legally liable to the Bank for any
reason or reasons arising out of, related to or in connection with the Agreement
other than as aforesaid, then the legal responsibility shall be limited to the
Company's equity in the "Mortgaged Property" and "collateral" as such terms are
defined in the Mortgage. Thus other than as aforesaid, the Bank agrees to look
solely to the Guarantor and to the Company's interest in the Collateral and the
Mortgaged Property for the payment of any sums for which the Company may become
legally liable to the Bank for any reason arising out of or in connection with
this Agreement, and other than as aforesaid the Bank agrees that it will not ▇▇▇
or seek legal recourse against the Partners.
Section 6.8 Jurisdiction. The Company agrees that any legal action or
proceeding with respect to this Agreement or to enforce any judgment obtained
against the Company in connection with this Agreement may be brought by the Bank
in the courts of the State of New York or in the United States District Court
for the Southern District of New York, or any other court to the jurisdiction of
which the Company or any of its property is or may be subject. The Company
irrevocably submits to the jurisdiction of the courts of the State of New York
or of the United States District Court for the Southern District of New York,
and irrevocably waives any present or future objection to venue in any such
court, and any present or future claim that any such court is an inconvenient
forum, in connection with any action or proceeding related to this Agreement.
Section 6.9 Participations. The Bank may participate to Participants of
the Bank's choosing all or any portion of its obligations under the Letter of
Credit and of the obligations of the Company and the Guarantor evidenced by this
Agreement the Pledge Agreement, the Mortgage and the Guaranty; provided that the
Company and the Guarantor shall have the right to continue to deal solely with
the Bank, and further provided that no such participation shall cause any
national rating agency to withdraw or lower the bond rating of the Bonds or
affect the tax exempt status of interest on the Bonds.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their thereunto duly authorized as of the date
first above stated.
WEST PLAINS MANOR
By: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
General Partner
/s/
--------------------------------------------
NATIONAL HEALTHCORP L.P.
By: NHC, INC.
Managing Partner
By: /s/
-----------------------------------------
Title: Sr. V.P.
THE BANK OF TOKYO, LTD., NEW YORK AGENCY
By: /s/
-----------------------------------------
Title: Attorney-in-Fact
