Exhibit 10.1
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AMENDED AND RESTATED
CREDIT AGREEMENT
dated as of
JUNE 12, 2008
By and Among
LHC GROUP, INC.,
a Delaware corporation
as Borrower
and
CAPITAL ONE, NATIONAL ASSOCIATION
as Agent
and
CAPITAL ONE, NATIONAL ASSOCIATION
FIRST TENNESSEE BANK, N. A.
and
BRANCH BANKING AND TRUST COMPANY
as Lenders
and
CAPITAL ONE CORPORATION
As Sole Book Runner and
Sole Lead Arranger
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS...............................................1
Section 1.1. Defined Terms................................................1
Section 1.2. Accounting Terms............................................15
ARTICLE II
LINE OF CREDIT LOAN COMMITMENT................................................15
Section 2.1. The Line of Credit..........................................15
Section 2.2. Revolving Loans.............................................15
Section 2.2.1. Revolving Loans...........................................15
Section 2.2.2. Letters of Credit.........................................15
Section 2.2.3. Procedures for Obtaining Letters of Credit...............16
Section 2.2.4. Manner and Notice of Borrowing Under the Line of Credit..17
Section 2.2.5. Use of Proceeds..........................................17
Section 2.2.6. Several Obligations......................................17
Section 2.3. Swing Line..................................................18
ARTICLE III
NOTES EVIDENCING THE LOANS....................................................19
Section 3.1. Notes.......................................................19
Section 3.1.1. Form of Notes............................................19
Section 3.1.2. Issuance of Additional Notes.............................19
Section 3.1.3. Payment of the Notes.....................................19
Section 3.1.4. Payment to the Lenders...................................19
Section 3.1.5. Sharing of Payments, Etc.................................20
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Section 3.1.6. Non-Receipt of Funds by the Agent........................20
ARTICLE IV
INTEREST RATES................................................................20
Section 4.1. Options.....................................................20
Section 4.1.1. Base Rate Loans..........................................20
Section 4.1.2. Eurodollar Loans.........................................21
Section 4.2. Interest Rate Determination.................................21
Section 4.3. Conversion Option...........................................21
ARTICLE V
CHANGE OF CIRCUMSTANCES.......................................................21
Section 5.1. Unavailability of Funds or Inadequacy of Pricing............21
Section 5.2. Change in Laws..............................................22
Section 5.3. Increased Cost or Reduced Return............................22
Section 5.4. Breakage Costs..............................................24
Section 5.5. Discretion of Lender as to Manner of Funding................24
Section 5.6. Foreign Lenders.............................................24
ARTICLE VI
FEES..........................................................................25
Section 6.1. Facility Fee................................................25
Section 6.2. Unused Fees.................................................25
Section 6.3. Letter of Credit Fee........................................25
ARTICLE VII
CERTAIN GENERAL PROVISIONS....................................................26
Section 7.1. Payments....................................................26
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Section 7.2. No Offset, etc..............................................26
Section 7.3. Rate Management Transactions................................26
Section 7.4. Calculation of Fees.........................................26
ARTICLE VIII
PREPAYMENTS...................................................................26
Section 8.1. Voluntary Prepayments.......................................26
Section 8.2. Mandatory Prepayment Resulting from Overadvances............26
ARTICLE IX
SECURITY FOR THE INDEBTEDNESS.................................................27
Section 9.1. Security....................................................27
ARTICLE X
CONDITIONS PRECEDENT..........................................................27
Section 10.1. Condition Precedent to Effectiveness of this Agreement.....27
Section 10.2. Conditions Precedent to all Revolving Loans................28
ARTICLE XI
REPRESENTATIONS AND WARRANTIES................................................29
Section 11.1. Corporate Authority of the Borrower........................29
Section 11.2. Financial Statements.......................................29
Section 11.3. Litigation.................................................29
Section 11.4. Approvals..................................................30
Section 11.5. Required Insurance.........................................30
Section 11.6. Licenses...................................................30
Section 11.7. Adverse Agreements.........................................30
Section 11.8. Default or Event of Default................................30
Section 11.9. Employee Benefit Plans.....................................30
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Section 11.10. Investment Company Act....................................30
Section 11.11. Intentionally Omitted.....................................31
Section 11.12. Regulations X, T and U....................................31
Section 11.13. Location of Offices and Records...........................31
Section 11.14. Information...............................................31
Section 11.15. Environmental Matters.....................................31
Section 11.16. Solvency of the Borrower..................................32
Section 11.17. Governmental Requirements.................................32
Section 11.18. Authority of the Guarantor................................33
Section 11.19. Survival of Representations and Warranties...............33
ARTICLE XII
AFFIRMATIVE COVENANTS.........................................................33
Section 12.1. Financial Statements; Other Reporting Requirements.........33
Section 12.2. Notice of Default; Litigation; ERISA Matters...............35
Section 12.3. Maintenance of Existence, Properties and Liens.............35
Section 12.4. Taxes......................................................35
Section 12.5. Compliance with Environmental Laws.........................35
Section 12.6. Further Assurances.........................................37
Section 12.7. Financial Covenants........................................37
Section 12.8. Operations.................................................37
Section 12.9. Change of Location.........................................38
Section 12.10. Employee Benefit Plans....................................38
Section 12.11. Deposit and Operating Accounts............................38
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Section 12.12. Field Audits; Other Information...........................38
Section 12.13. Insurance.................................................38
Section 12.14. Subsidiaries..............................................38
Section 12.15. Collateral Documents.....................................39
Section 12.16. Post-Closing Requirements................................39
Section 12.17. Excluded Subsidiaries....................................39
ARTICLE XIII
NEGATIVE COVENANTS............................................................40
Section 13.1. Limitations on Fundamental Changes.........................40
Section 13.2. Disposition of Assets......................................40
Section 13.3. Intentionally Omitted......................................40
Section 13.4. Encumbrances; Negative Pledge..............................40
Section 13.5. Debts......................................................42
Section 13.6. Investments, Loan and Revolving Loans......................43
Section 13.7. Intentionally Omitted......................................44
Section 13.8. Transactions with Affiliates...............................44
ARTICLE XIV
EVENTS OF DEFAULT.............................................................44
Section 14.1. Events of Default..........................................44
Section 14.2. Waivers....................................................46
ARTICLE XV
THE AGENT AND THE LENDERS.....................................................47
Section 15.1. Appointment and Authorization..............................47
Section 15.2. Intentionally Omitted......................................48
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Section 15.3. Consultation with Counsel..................................48
Section 15.4. Documents..................................................48
Section 15.5. Resignation or Removal of Agent............................48
Section 15.6. Responsibility of Agent....................................48
Section 15.7. Independent Investigation..................................49
Section 15.8. Indemnification............................................50
Section 15.9. Benefit of Article XV......................................50
Section 15.10. Pro Rata Treatment........................................50
Section 15.11. Intentionally Omitted.....................................50
Section 15.12. Other Financings..........................................50
Section 15.13. Interests of the Lenders..................................51
Section 15.14. Investments...............................................51
ARTICLE XVI
MISCELLANEOUS.................................................................51
Section 16.1. No Waiver; Modification in Writing.........................51
Section 16.2. Addresses for Notices......................................52
Section 16.3. Fees and Expenses..........................................53
Section 16.4. Right of Set-off...........................................53
Section 16.5. Waiver of Marshaling.......................................53
Section 16.6. Governing Law..............................................53
Section 16.7. Consent to Loan Participation..............................53
Section 16.8. Intentionally Omitted......................................54
Section 16.9. Permitted Assignment.......................................54
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Section 16.10. Indemnity.................................................54
Section 16.11. Maximum Interest Rate.....................................55
Section 16.12. Waiver of Jury Trial; Submission to Jurisdiction..........56
Section 16.13. Severability..............................................57
Section 16.14. Headings..................................................57
Section 16.15. Confidentiality...........................................57
SCHEDULES
Schedule 1.1(a) Excluded Subsidiaries
Schedule 1.1(b) Guarantors
Schedule 6 Designated Fee Account
Schedule 11.3 Litigation
Schedule 13.4 Encumbrances
Schedule 13.5 Existing Indebtedness
Schedule 13.6 Existing Investments
Schedule 13.8 Transactions with Affiliates
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AMENDED AND RESTATED
CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (the "Agreement") dated as of
June 6, 2008, is by and among LHC GROUP, INC., a Delaware corporation (the
"Borrower"), the LENDERS, and CAPITAL ONE, NATIONAL ASSOCIATION, a national
banking association, individually as a Lender and as Administrative Agent, and
CAPITAL ONE CORPORATION, as sole bookrunner and sole lead arranger.
RECITALS:
A. The Borrower, Capital One, National Association, and First Tennessee
Bank, National Association, as Lenders, and Capital One, National Association,
as Agent, are the parties to that certain Credit Agreement dated as of February
20, 2008, as amended by First Amendment, thereto dated as of March 6, 2008, and
by Second Amendment thereto dated as of March 31, 2008 (as so amended, the
"Original Agreement").
B. The Original Agreement provides for a Line of Credit Loan Commitment
in the total maximum aggregate principal amount of $37,500,000.00.
C. Pursuant to Section 2.4 of the Original Agreement, the Borrower
elected to increase the Line of Credit Loan Commitment and a new and additional
Lender is joining in this Agreement to provide for a Line of Credit Loan
Commitment in the maximum total aggregate principal amount of $75,000,000.00.
D. To evidence the increased Line of Credit Loan Commitment and certain
other changes to the Original Agreement, the parties desire to amend and restate
the Original Agreement.
Now therefore, in consideration of the premises, the parties do hereby
amend and restate the Original Agreement as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
--------------------------------
Section 1.1. Defined Terms. As used in this Agreement, and unless the
context requires a different meaning, the following terms have the meanings
indicated:
"Acquisition" shall mean any transaction or series of related transactions,
consummated on or after the date hereof, by which the Borrower or any
Subsidiary directly, (i) acquires a majority voting interest in any active
business, or all or substantially all of the assets, of any Person, whether
through purchase of assets, merger or otherwise, or (ii) acquires
securities or other ownership interests of any Person having at least a
majority of combined voting power of the then outstanding securities or
other ownership interests of such Person.
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"Agent" shall mean Capital One, National Association in its capacity as
contractual, administrative, and collateral representative of the Lenders
pursuant to Article XV, and not in its individual capacity as a Lender, and
any successor Agent appointed pursuant to Article XV.
"Agreement" shall mean this Amended and Restated Credit Agreement, as the
same may from time to time be amended, modified, supplemented, and/or
restated and in effect from time to time.
"Base Rate" shall mean the base rate of interest established from time to
time by The Wall Street Journal, as the "prime" lending rate on corporate
loans posted by at least seventy-five percent (75%) of the nation's thirty
largest banks, and which is not necessarily the lowest rate charged by any
of the Lenders, such rate to be adjusted automatically on and as of the
effective date of any change in such Base Rate.
"Base Rate Interest Period" shall mean, with respect to any Base Rate Loan,
the period ending on the last day of each month, provided, however, that
(i) if any Base Rate Interest Period would end on a day which is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day, and (ii) if any Base Rate Interest Period would otherwise end
after the Termination Date, such Interest Period shall end on the
Termination Date.
"Base Rate Loans" shall mean any Loan during any period which bears
interest based upon the Base Rate.
"Base Rate Margin" shall mean, with respect to each Base Rate Loan:
(i) minus 0.25% if the Leverage Ratio is less than 1.00 to 1.0; or
(ii) plus 0.00% if the Leverage Ratio is greater than or equal to
1.00 to 1.0.
The Base Rate Margin shall be determined by the Agent from time to
time, based on the Leverage Ratio as set forth in the Compliance
Certificate most recently delivered by the Borrower pursuant to Section
12.1(c). Any adjustment to the Base Rate Margin shall be effective (a) in
the case of a Compliance Certificate delivered in connection with quarterly
financial statements of the Borrower delivered pursuant to Section 12.1(b),
as of the date 60 days following the end of the last day of the applicable
fiscal quarter covered by such Compliance Certificate, and (b) in the case
of a Compliance Certificate delivered in connection with annual financial
statements of the Borrower delivered pursuant to Section 12.1(a), as of the
date 90 days following the end of the last day of the applicable fiscal
year covered by such Compliance Certificate. If the Borrower fails to
deliver a Compliance Certificate pursuant to Section 12.1(c), the Base Rate
Margin shall equal the percentage corresponding to item (ii) of this
definition until the date of the delivery of the required Compliance
Certificate. As of the date hereof, and thereafter until changed as
provided above, the Base Rate Margin is determined based on item (ii) of
this definition.
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"Borrower" shall mean LHC Group, Inc., a Delaware corporation, together
with its successors and assigns.
"Borrowing Date" means the date elected by Borrower pursuant to Section
2.2.4. hereof for a Revolving Loan.
"Business Day" means a day other than a Saturday, Sunday or legal holiday
for commercial banks under the laws of the State of Louisiana or a day on
which national banks are authorized to be closed in Lafayette and/or New
Orleans, Louisiana.
"Capital Lease Obligations" means any Debt represented by obligations under
a lease that is required to be capitalized for financial reporting purposes
in accordance with GAAP.
"Capital One" means Capital One, National Association in its individual
capacity as a Lender, and its successors and assigns.
"Collateral" shall mean any interest in any kind of property or assets
pledged, mortgaged or otherwise subject to an Encumbrance in favor of the
Agent for the benefit of the Lenders pursuant to the Collateral Documents.
"Collateral Documents" shall collectively refer to any and all documents
now or hereafter in which an Encumbrance is created on any property of the
Borrower or of any other Person to secure payment of the Indebtedness (or
any part thereof) of the Borrower to the Lenders under this Agreement and
the Notes, including the Pledge Agreement and any joinder thereto executed
by the Borrower and any Guarantor.
"Commitments" shall mean collectively the Line of Credit Loan Commitments
of each Lender as specified on the signature page(s) of this Agreement or
specified in connection with an assignment made pursuant to Section 16.9
hereof.
"Commitment Percentage" shall mean for each Lender the percentage of the
Commitment of such Lender divided by the aggregate amount of all
Commitments of all Lenders.
"Compliance Certificate" shall have the meaning assigned to such term in
Section 12.1(c) of this Agreement.
"Consolidated Current Assets" shall mean the total of the Borrower's
consolidated current assets determined in accordance with GAAP.
"Consolidated Current Liabilities" shall mean the total of the Borrower's
consolidated current liabilities plus the existing outstanding balance
under the Line of Credit, determined in accordance with GAAP.
3
"Debt" shall mean without duplication: (i) indebtedness for borrowed money;
(ii) the face amounts of all outstanding standby and commercial letters of
credit and bankers acceptances, matured or unmatured, issued on behalf of
Borrower; (iii) guaranties of the Debt of any other Person, whether direct
or indirect, whether by agreement to purchase the indebtedness of any other
Person or by agreement for the furnishing of funds to any other Person
through the purchase or lease of goods, supplies or services (or by way of
stock purchase, capital contribution, advance or loan) in each case for the
purpose of paying or discharging the Debt of any other Person; and (iv) the
present value of all obligations for the payment of rent or hire of
property of any kind (real or personal) under leases or lease agreements
required to be capitalized under GAAP.
"Default" shall mean an event which with the giving of notice or the lapse
of time (or both) would constitute an Event of Default hereunder.
"Defaulting Lender" is used herein as defined in Section 3.1.4 hereof.
"Disposition" means any sale, transfer, lease, contribution, conveyance or
other disposition (including by way of merger) of, or the granting of
options, warrants or other rights to, any asset to any other Person (other
than to the Borrower or a Subsidiary) in one or a series of transactions.
The term "Dispose" has a correlative meaning.
"Dollars" and "$" shall mean lawful money of the United States of America.
"EBITDA" shall mean the Borrower's consolidated earnings before interest,
taxes, depreciation, and amortization, all as determined in accordance with
GAAP; provided, however, if Borrower acquires a one hundred percent (100%)
interest in an entity at an acquisition price exceeding $15,000,000.00,
then the acquired entity's historical trailing 12-months earnings before
interest, taxes, depreciation, and amortization, all as determined in
accordance with GAAP will be included in Borrower's EBITDA for purposes of
calculating the covenants set forth in Section 12.7(a) and Section 12.7(c)
hereof.
"Encumbrances" shall mean individually, collectively and interchangeably
any and all presently existing and/or future mortgages, liens, privileges,
servitudes, rights-of-way and other contractual and/or statutory security
interests and rights of every nature and kind that, now and/or in the
future may affect the property of Borrower or any part or parts thereof.
"Environmental Laws" shall mean any federal, state, local or tribal
statute, law, rule, regulation, ordinance, code, permit, consent, approval,
license, written policy or rule of common law now or hereafter in effect
and in each case as amended, and any judicial or administrative
interpretation thereof, including any judicial or administrative order,
injunction, consent decree or judgment, or other authorization or
requirement whenever promulgated, issued or modified, including the
requirement to register underground storage tanks, well plugging and
abandonment requirements, and oil and gas waste disposal requirements
relating to: (i) emissions, discharges, spills, migration, movement,
releases or threatened releases of pollutants, contaminants, Hazardous
Materials, or hazardous or toxic materials or wastes into or onto soil,
land, ambient air, surface water, ground water, watercourses, publicly
owned treatment works, drains, sewer systems, wetlands or septic systems;
4
(ii) the use, treatment, storage, disposal, handling,
manufacturing, transportation, or shipment of Hazardous Materials or
hazardous and/or toxic wastes, material, products or by-products containing
Hazardous Materials (or of equipment or apparatus containing Hazardous
Materials); or
(iii) otherwise relating to pollution or the protection of human
health or the environment, including, without limitation, the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C.
xx.xx. 9601 et seq., as amended, the Resource Conservation and Recovery
Act, 42 U.S.C. xx.xx. 6901 et seq., as amended, the Hazardous Materials
Transportation Act, 49 U.S.C. xx.xx. 1801 et seq., as amended, the Clean
Water Act, 33 U.S.C. xx.xx. 1251 et seq., as amended, the Toxic Substances
Control Act, 15 U.S.C. xx.xx. 2601 et seq., as amended, the Clean Air Act,
42 U.S.C. xx.xx. 7401 et seq., as amended, the federal Water Pollution
Control Act, 33 U.S.C. ss. 1251 et seq., as amended, the Safe Drinking
Water Act, 42 U.S.C. xx.xx. 300f et seq., as amended, the Atomic Energy
Act, 42 U.S.C. xx.xx. 2011 et seq., as amended, the Natural Gas Pipeline
Safety Act of 1968, 49 U.S.C. ss. 1671 et seq., as amended, the Federal
Insecticide, Fungicide and Rodenticide Act, 7 U.C.S. xx.xx. 136 et seq., as
amended, and the Occupational Safety and Health Act, 29 U.S.C. xx.xx. 651
et seq., as amended, and all comparable statutes of the State of Louisiana,
and all comparable local Governmental Requirements in such state.
"Environmental Liabilities" means with respect to any Person, any and all
liabilities, responsibilities, losses, sums paid in settlement of claims,
obligations, charges, actions (formal or informal), claims (including,
without limitation, claims for personal injury or for property damage),
liens, administrative proceedings, damages (including, without limitation,
loss or damage resulting from the occurrence of an Event of Default),
punitive damages, consequential damages, treble damages, penalties, fines,
monetary sanctions, interest, court costs, response and remediation costs,
stabilization costs, encapsulation costs, treatment, storage, or disposal
costs, groundwater monitoring or environmental sampling costs, other causes
of action and any other costs and expenses (including, without limitation,
reasonable attorneys', experts', and consultants' fees, costs of
investigation and feasibility studies and disbursements in connection with
any investigative, administrative or judicial proceeding), whether direct
or indirect, known or unknown, absolute or contingent, past, present or
future arising under, pursuant to or in connection with any Environmental
Law, or any other binding obligation of such Person requiring abatement of
pollution or protection of human health and the environment.
"Environmental Lien" means a Lien in favor of any Governmental Authority
for (i) any liability under Environmental Laws or (ii) damages arising
from, or costs incurred by such Governmental Authority in response to, a
Release or threatened Release of a Hazardous Materials into the
environment.
5
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time.
"ERISA Group" means the Borrower, any Subsidiary and all members of a
controlled group of corporations and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or
any Subsidiary, are treated as a single employer under Section 414 of the
Internal Revenue Code.
"Excluded Subsidiary" shall mean any entity listed on Schedule 1.1(a) and
any other Subsidiary in which the owner of the minority ownership interest
in such Subsidiary has not consented to the execution, delivery and
performance of the Guaranty by such Subsidiary; provided that the Borrower
shall have put forth reasonable efforts to obtain such consent. All
Subsidiaries of an Excluded Subsidiary shall be deemed to be Excluded
Subsidiaries.
"Eurodollar Business Day" shall mean any date other than Saturday, Sunday
or a day on which banking institutions are generally authorized or
obligated by law or executive order to close in the City of London,
England.
"Eurodollar Interest Period" shall mean, with respect to any Eurodollar
Loan (i) initially, the period commencing on the date such Eurodollar Loan
is made and ending one (1) month (or such other period agreed upon by the
Borrower and the Lenders) thereafter, and (ii) thereafter, each period
commencing on the day following the last day of the next preceding Interest
Period applicable to such Eurodollar Loan and ending one (1) month (or such
other period agreed upon by the Borrower and the Lenders) thereafter;
provided, however, that (a) if any Eurodollar Interest Period would
otherwise expire on a day which is not a Business Day, such Interest Period
shall expire on the next succeeding Business Day unless the result of such
extension would be to extend such Interest Period into the next calendar
month, in which case such Interest Period shall end on the immediately
preceding Business Day, (b) if any Eurodollar Interest Period begins on the
last Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end of such
Interest Period) such Interest Period shall end on the last Business Day of
a calendar month, and (c) any Eurodollar Interest Period which would
otherwise expire after the Termination Date shall end on the Termination
Date.
"Eurodollar Loan" shall mean any Loan during any period which bears
interest at the Eurodollar Rate.
"Eurodollar Margin" shall mean with respect to each Eurodollar Loan under
the Line of Credit:
6
(i) 1.75% per annum if the Leverage Ratio is less than 1.00 to 1.0;
(ii) 2.00% per annum if the Leverage Ratio is greater than or equal
to 1.00 to 1.0 but less than 1.50 to 1.0;
(iii) 2.25% per annum if the Leverage Ratio is greater than or equal
to 1.50 to 1.0 but less than 2.00 to 1.0; or
(iv) 2.50% per annum if the Leverage Ratio is greater than or equal
to 2.00 to 1.0.
The Eurodollar Margin shall be determined by the Agent from time to time,
based on the Leverage Ratio as set forth in the Compliance Certificate most
recently delivered by the Borrower pursuant to Section 12.1(c). Any
adjustment to the Eurodollar Margin shall be effective (a) in the case of a
Compliance Certificate delivered in connection with quarterly financial
statements of the Borrower delivered pursuant to Section 12.1(b), as of the
date 60 days following the end of the last day of the applicable fiscal
quarter covered by such Compliance Certificate, and (b) in the case of a
Compliance Certificate delivered in connection with annual financial
statements of the Borrower delivered pursuant to Section 12.1(a), as of the
date 90 days following the end of the last day of the applicable fiscal
year covered by such Compliance Certificate. If the Borrower fails to
deliver a Compliance Certificate pursuant to Section 12.1(c), the
Eurodollar Margin shall equal the percentage corresponding to item (iv) of
this definition until the date of the delivery of the required Compliance
Certificate. As of the date hereof, and thereafter until changed as
provided above, the Eurodollar Margin is determined based on item (i) of
this definition.
"Eurodollar Rate" shall mean with respect to any Eurodollar Interest
Period, the offered rate for U.S. Dollar deposits of not less than
$1,000,000 as of 11:00 A.M. City of London, England time two (2) Eurodollar
Business Days prior to the first date of each Eurodollar Interest Period as
shown on the display designated as "British Bankers Assoc. Interest
Settlement Rates" on the Telerate system ("Telerate"), Reuters Screen LIBOR
01 Page, or such other page or pages as may replace such pages on Telerate
for the purpose of displaying such rate, rounded upwards, if necessary to
the nearest 1/16% and adjusted for the maximum cost of reserves, if any.
Provided, however, that if such rate is not available on Telerate then such
offered rate shall be otherwise independently obtained by the Agent from an
alternate, substantially similar independent source available to the Agent
or shall be calculated by the Agent by substantially similar methodology as
that theretofore used to determine such offered rate in Telerate.
"Event of Default" shall mean individually, collectively and
interchangeably any of the Events of Default set forth below in Section
14.1. hereof.
"Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight federal funds transaction with
members of the Federal Reserve System arranged by federal fund brokers on
such day, as published by the Federal Reserve Bank of New York on the
7
Business Day, next succeeding such day; provided, however, that (i) if such
day is not a Business Day, the Federal Funds Rate for such day shall be
such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day, and (ii) if no such rate is
so published on the next succeeding Business Day, the Federal Funds Rate
for such day shall be the average of quotations for such Business Day on
such transactions received by the Agent from three (3) federal funds
brokers of recognized standing selected by it. If, for any reason, the
Agent shall have determined (which determination shall be conclusive,
absent manifest error) that it is unable to ascertain the Federal Funds
Rate, including the inability or failure of the Agent to obtain sufficient
quotations in accordance with the terms hereof, the Base Rate shall be
determined without regard to clause (i) of the first sentence of the
definition of Base Rate until the circumstances giving rise to such
inability no longer exist.
"GAAP" shall mean, at any time, accounting principles generally accepted in
the United States as then in effect.
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof, or entity exercising executive,
legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Governmental Requirement" shall mean any applicable state, federal or
local law, statute, ordinance, code, rule, regulation, order or decree.
"Guarantor" means individually and collectively, each entity set forth on
Schedule 1.1(b), and each of their respective successors and assigns, and
any future Subsidiary of Borrower that is not an Excluded Subsidiary.
"Guaranty" means that certain Amended and Restated Commercial Guaranty of
even date with this Agreement executed by each Guarantor in favor of the
Agent for the ratable benefit of the Lenders, as amended, supplemented
and/or restated from time to time and in effect, and any joinder to such
Amended and Restated Commercial Guaranty executed after the date of the
Agreement by a Subsidiary of the Borrower that is not an Excluded
Subsidiary.
"Hazardous Materials" means (1) hazardous materials, hazardous wastes, and
hazardous substances including, but not limited to, those substances,
materials and wastes listed in the United States Department of
Transportation Hazardous Materials Table, 49 C.F.R. ss. 172.101, as
amended, or listed by the federal Environmental Protection Agency as
hazardous substances under or pursuant to 40 C.F.R. Part 302, as amended,
or substances, materials, contaminants or wastes which are or become
regulated under any Environmental Law, including without limitation, those
substances, materials, contaminants or wastes as defined in the following
statutes and their implementing regulations: the Hazardous Materials
Transportation Act, 49 U.S.C. ss. 1801 et seq., as amended, the Resource
Conservation and Recovery Act, 42 U.S.C. ss. 6901 et seq., as amended, the
Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. ss. 9601 et seq., as amended, the Toxic Substances Control Act, 15
U.S.C. ss. 2601 et seq., as amended, the Clean Air Act, 42 U.S.C. ss. 7401
8
et seq., as amended, the federal Water Pollution Control Act, 33 U.S.C. ss.
1251 et seq., as amended, the Occupational Safety and Health Act, 2 U.S.C.
ss. 651 et seq., as amended, the Safe Drinking Water Act, 42 U.S.C. ss.300f
et seq., as amended and the Natural Gas Pipeline Safety Act of 1968, 49
U.S.C. ss. 1671 et seq., as amended; (2) all substances, materials,
contaminants or wastes listed in all comparable statutes of the States of
Louisiana and Texas and in comparable local Requirements of Law in such
states; (3) acid gas, sour water streams or sour water vapor streams
containing hydrogen sulfide or other forms of sulphur, sodium hydrosulfide
and ammonia; (4) Hydrocarbons; (5) natural gas, synthetic gas, and any
mixtures thereof; (6) asbestos and/or any material which contains 1% or
more, by weight, of any hydrated mineral silicate, including but not
limited to chrysotile, amosite, crocidolite, tremolite, anthophylite and/or
actinolite, whether friable or non-friable; (7) PCB's, or PCB containing
materials or fluids; (8) radon; (9) naturally occurring radioactive
material, radioactive substances or waste; (10) salt water and other oil
and gas wastes and (11) any other hazardous or noxious substance, material,
pollutant, emission, or solid, liquid or gaseous waste.
"Indebtedness" shall mean, at any time, all obligations, indebtedness, and
liabilities, whether now existing or arising in the future, of the Borrower
to the Lenders or any of them (or in the case of a Rate Management
Transaction, any affiliate thereof) pursuant to or arising under the
Agreement, including all Reimbursement Obligations, obligations of the
Borrower under Rate Management Transactions (including all renewals,
extensions, modifications, and substitution thereof and therefor) and all
cancellations, buy backs, reversals, terminations, or assignments of Rate
Management Transactions, and the indebtedness of the Borrower evidenced by
the Notes, including principal, interest, costs, expenses and reasonable
attorneys' fees and all other fees and charges, together with all fees and
other indebtedness and costs and expenses for which the Borrower is
responsible under this Agreement or under any of the Related Documents.
"Interest Payment Date" shall mean (i) for a Base Rate Loan, the last
Business Day of each month such Loan is outstanding, (ii) for a Eurodollar
Loan, the last Eurodollar Business Day of each Eurodollar Interest Period
for such Loan.
"Interest Period" shall mean any Base Rate Interest Period or Eurodollar
Interest Period.
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended.
"Investment" means, with respect to any Person, (a) the purchase or other
acquisition of any stock or other equity interest in another Person, (b) a
loan, advance or extension of credit to, capital contribution to, or
purchase or other acquisition of any Debt of, another Person, or (c) the
purchase or other acquisition (in one transaction or a series of
transactions) of assets of another Person that constitute the business or a
division or operating unit of another Person.
9
"Lenders" shall mean the lending institutions listed on the signature
page(s) of this Agreement, and their respective successors and assigns, and
any other lending institutions that become a signatory party to the
Agreement in the future.
"Letters of Credit" shall mean the letters of credit issued by the Agent
pursuant to Section 2.2.2. hereof.
"Leverage Ratio" shall mean the ratio produced by the following
calculation: the sum of all senior funded Debt by the Lenders or any of
them to Borrower and/or any Guarantor divided by EBITDA, tested quarterly
on a rolling four quarters basis.
"Liabilities" shall mean, as to any Person, all indebtedness, liabilities
and obligations of such Person, whether matured or unmatured, liquidated or
unliquidated, primary or secondary, direct or indirect, absolute, fixed or
contingent, and whether or not required to be considered pursuant to GAAP.
"Line of Credit" shall mean the revolving line of credit in the total
maximum aggregate principal amount of the Commitments extended by the
Lenders pursuant to the Line of Credit Loan Commitment.
"Line of Credit Loan Commitment" shall mean (i) for all Lenders,
$75,000,000.00; and (ii) as to any Lender, its obligation to make Revolving
Loans hereunder on its Pro Rata Part of the Line of Credit and purchase its
Pro Rata Part of participations in Letters of Credit issued hereunder by
the Agent in amounts not exceeding an amount equal to its Commitment
Percentage times the Line of Credit Loan Commitment in existence at the
time of determination.
"Loans" shall mean, collectively, all Revolving Loans.
"Loan Documents" shall mean this Agreement, the Notes, any other documents
and instruments evidencing any portion of the Indebtedness, the Guaranty,
the Collateral Documents, and any other instruments and documents, whether
now or hereafter existing, executed in connection with the Indebtedness.
"Material Adverse Effect" shall mean an event which causes a material
adverse effect on the business, assets, operations or financial condition
of the Borrower and its Subsidiaries, taken as a whole.
"Maximum Rate" shall mean, at any particular time in question, the maximum
non-usurious rate of interest which under applicable law may then be
charged on the Indebtedness or any other obligations hereunder. If such
Maximum Rate changes after the date hereof, the Maximum Rate shall be
automatically increased or decreased, as the case may be, without notice to
Borrower from time to time as the effective date of each change in such
Maximum Rate.
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"Multiemployer Plan" means at any time a multiemployer plan within the
meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions, including for
these purposes any Person which ceased to be a member of the ERISA Group
during such five year period.
"Notes" shall mean the Revolving Notes.
"Other Financing" is used herein as defined in Section 15.12. hereof.
"Original Agreement" is used herein as defined in recital A of this
Agreement.
"Payor" is used herein as defined in Section 3.1.6. hereof.
"Permitted Encumbrances" shall have the meaning ascribed to such term in
Section 13.4. hereof.
"Permitted Investments" means (a) direct obligations of, or obligations the
principal of and interest on which are unconditionally guaranteed by, the
United States of America (or by any agency thereof to the extent such
obligations are backed by the full faith and credit of the United States of
America), in each case maturing within one year from the date of
acquisition thereof; (b) Investments in commercial paper maturing within
270 days from the date of acquisition thereof and having, at such date of
acquisition, the highest credit rating obtainable from Standard & Poor's
Ratings Service or from Xxxxx'x Investors Service, Inc.; (c) Investments in
certificates of deposit, banker's acceptances and time deposits maturing
within one year from the date of acquisition thereof issued or guaranteed
by or placed with, and money market deposit accounts issued or offered by,
any domestic office of any commercial bank organized under the laws of the
United States of America or any State thereof that has a combined capital
and surplus and undivided profits of not less than $250,000,000.00; (d)
fully collateralized repurchase agreements with a term of not more than 30
days for securities described in clause (a) above and entered into with a
financial institution satisfying the criteria described in clause (c)
above; and (e) shares of funds registered under the Investment Company Act
of 1940, as amended, that have assets of at least $100,000,000 and invest
only in obligations described in clauses (a) through (d) above to the
extent that such shares are rated by Xxxxx'x Investors Service, Inc. or
Standard & Poor's Ratings Service in one of the two highest rating
categories assigned by such agency for shares of such nature.
"Person" shall mean an individual or a corporation, partnership, trust,
joint venture, incorporated or unincorporated association, joint stock
company, government, or an agency or political subdivision thereof, or
other entity of any kind.
"Pledge Agreement" shall mean that certain Security Agreement by certain
Subsidiaries of the Borrower in favor of the Agent, affecting ownership
interests in certain Excluded Subsidiaries, as the Security Agreement may
be amended, supplemented and/or restated from time to time and in effect,
and any joinder to such Security Agreement executed by a Subsidiary of the
Borrower.
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"Pro Rata" or "Pro Rata Part" shall mean for each Lender, (i) for all
purposes where no Loan is outstanding, such Lender's Commitment Percentage
for matters relating to the Line of Credit Loan Commitment and (ii)
otherwise, the proportion which the portion of the outstanding Loans owed
to such Lender bears to the aggregate outstanding Loans owed to Lenders at
the time in question (calculated separately for each Lender for Loans under
the Line of Credit).
"Purchase Money Indebtedness" means Debt incurred to finance the
acquisition, construction or improvement of any fixed or capital assets,
including Debt assumed in connection with the acquisition of any such
assets or secured by an Encumbrance on any such assets prior to the
acquisition thereof, and any extension, renewal or replacement of any such
Debt.
"Rate Management Transaction" means any transaction (including an agreement
with respect thereto) now existing or hereafter entered into between the
Borrower and any Lender or affiliate thereof which is (i) an interest rate
protection agreement, foreign currency exchange agreement or other interest
or interest rate hedging agreement entered into in the ordinary course and
not for speculative purposes or (ii) a commodity price hedging agreement or
arrangement entered into in the ordinary course and not for speculative
purposes.
"Reimbursement Obligations" shall mean at any time, the obligations of
Borrower in respect of all Letters of Credit then outstanding to reimburse
amounts paid by the Lenders (or any of them) in respect of any drawing or
drawings under a Letter of Credit.
"Release" means any release, spill, emission, leak, injection, deposit,
disposal, discharge, dispersal, leaching or migration of any Hazardous
Materials into the environment or into or out of any real property of
Borrower, including the movement of Hazardous Materials through or in the
air, soil, surface water, groundwater and/or land which could reasonably be
expected to form the basis of an Environmental Liability against Borrower.
"Remedial Action" means any action to (i) clean up, remove, treat or in any
other way address Hazardous Materials in the environment, (ii) prevent the
Release or threat of Release or minimize the further Release of Hazardous
Materials so they do not mitigate or endanger or threaten to endanger
public health or welfare or the environment or (iii) perform pre-remedial
studies and investigations and post-remedial monitoring and care.
"Request for Revolving Loan" shall mean the Borrower's request for a
Revolving Loan.
"Required Lenders" shall mean (i) if there are two (2) or fewer Lenders
under this Agreement, then "Required Lenders" shall mean all Lenders (other
than Defaulting Lenders who are not entitled to vote); or (ii) if there are
three (3) or more Lenders under this Agreement, then "Required Lenders"
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shall mean Lenders having more than sixty-six percent (66%) of the
aggregate amount of the Commitments (not held by Defaulting Lenders who are
not entitled to vote), or if the Commitments have been terminated or
reduced to zero, Lenders holding more than 66% of the principal amount of
the aggregate outstanding Loans and Reimbursement Obligations (not held by
Defaulting Lenders who are not entitled to vote). Commitments, Revolving
Loans and Reimbursement Obligation held by Defaulting Lenders shall be
disregarded when determining the Required Lenders. For purposes of this
definition, a Lender (other than the Agent with respect to the Swing Line)
shall be deemed to hold a Swing Line interest or a Reimbursement Obligation
to the extent such Lender has acquired a participation therein under the
terms of this Agreement and has not failed to perform its obligations in
respect of such participation.
"Required Payment" is used herein as defined in Section 3.1.6 hereof.
"Revolving Loans" shall mean all advances under the Line of Credit
(including advances under the Swing Line) made by the Lenders under the
Notes to the Borrower in accordance with and subject to the terms of their
respective Commitments.
"Revolving Notes" shall mean collectively (i) the promissory notes of even
date herewith in the maximum aggregate principal amount of the Commitment
of each Lender party hereto and substantially in the form of Exhibit C
attached hereto, executed by Borrower, (ii) any promissory note or notes
that may be executed by Borrower in the future that are payable to the
order of a Lender pursuant to the Agreement, and (iii) any and all
modifications, renewals, and/or extension of any of the foregoing
promissory notes.
"Required Payment" is used herein as defined in Section 3.1.6 hereof.
"Solvent" shall mean, when used with respect to any Person on a particular
day, that on such date (i) the fair value of the property of such Person is
greater than the total amount of liabilities, including without limitation,
contingent liabilities, of such person, (ii) the present fair salable value
of the assets of such person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as they
become absolute and matured, (iii) such Person is able to realize upon its
assets and pay its debts and other liabilities, contingent obligations and
other commitments as they mature in the ordinary course of business, (iv)
such Person does not intend to, and does not believe that it will, incur
debts and liabilities beyond such Person's ability to pay as such debts and
liabilities mature, and (v) such Person is not engaged in business or a
transaction, and is not about to engage in business or a transaction, for
which such Person's property would constitute unreasonably small capital
after giving due consideration to the prevailing practice in the industry
in which such person is engaged. In computing the amount of contingent
liabilities at any time, it is intended that such liabilities will be
computed at the amount which, in light of all of the facts and
circumstances existing at such time, represents the amount that can be
reasonably expected to become an actual or matured liability.
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"Subsidiaries" shall mean at any date with respect to any Person all the
corporations, limited liability companies, or other business entities of
which such Person at such date, directly or indirectly, owns or controls
more than 50% of the outstanding ownership interest or capital stock
(excluding directors' qualifying shares), and "Subsidiary" means any one of
the Subsidiaries.
"Swing Line" shall mean all Swing Line Loans, up to a total maximum
aggregate principal amount of $7,500,000.00, made to Borrower by the Swing
Line Lender.
"Swing Line Lender" shall mean Capital One.
"Swing Line Loans" shall have the meaning assigned to such term in Section
2.3 below.
"Tangible Net Worth" shall mean the sum of the Borrower's common stock,
preferred stock, capital surplus and retained earnings less treasury stock
and the sum of all intangible assets (including, without limitation, good
will, franchises, licenses, patents, trademarks, trade names, copyrights,
service marks and brand names).
"Termination Date" shall mean the earlier to occur of (i) June 6, 2010 or
(ii) the date of termination of the Commitments pursuant to Article XIV
hereof.
"Total Liabilities" shall mean the total consolidated liabilities of
Borrower, as determined in accordance with GAAP.
"Total Outstandings" shall mean as of any date, without duplication, the
sum of (i) the total principal balance outstanding on the Notes, plus (ii)
the total face amount of all outstanding Letters of Credit plus (iii) the
total of all Reimbursement Obligations.
"Tranche" shall mean a Eurodollar Loan for a particular Interest Period
and/or a Base Rate Loan.
"UCC" shall mean the Uniform Commercial Code-Secured Transactions (La. R.S.
10:9-101 et seq.) in the State of Louisiana, as amended from time to time,
provided that if by reason of mandatory provisions of law, the perfection
or effect of perfection or non-perfection of the Lender's Encumbrances
against the Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of Louisiana, then "UCC"
means the Uniform Commercial Code as the same may be amended from time to
time and in effect in such other jurisdiction.
"Unused Amount" shall have the meaning assigned to such a term in Section
6.2 of the Agreement.
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Section 1.2. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP, and all financial
data submitted pursuant to this Agreement shall be prepared in accordance with
GAAP.
ARTICLE II
LINE OF CREDIT LOAN COMMITMENT
------------------------------
Section 2.1. The Line of Credit. Subject to the terms and conditions of
this Agreement, each Lender agrees severally (a) to make its Pro Rata Part of
Revolving Loans to the Borrower during the period from the date hereof until the
Termination Date, by making Revolving Loans under the Line of Credit to the
Borrower from time to time; provided, however, that at no time shall the sum of
the aggregate principal amount of such Revolving Loans to the Borrower at such
time outstanding exceed the Line of Credit Loan Commitment. Notwithstanding the
foregoing, it is agreed and understood that each Lender's obligation to fund
Revolving Loans is limited to such Lender's Line of Credit Loan Commitment less
its Pro Rata Part of the Total Outstandings.
Section 2.2. Revolving Loans.
Section 2.2.1. Revolving Loans. Subject to the terms and conditions of this
Agreement, each Lender severally agrees to make Revolving Loans to the Borrower
from time to time under the Line of Credit. Within the limits set forth herein,
the Borrower may borrow from the Lenders hereunder, repay any and all such
Revolving Loans as hereinafter provided, and reborrow thereunder; provided,
however, each Revolving Loan, subject to availability, shall be in an amount not
less than $1,000,000.00. The Borrower's obligation to repay the Revolving Loans
made by the Lenders shall be evidenced by the Notes. Revolving Loans under the
Line of Credit shall bear interest, at Borrower's option, at the Base Rate plus
or minus the Base Rate Margin or the Eurodollar Rate plus the Eurodollar Margin.
The total number of Tranches under the Line of Credit which may be outstanding
at any time hereunder shall never exceed seven (7) Tranches, whether such
Tranches are Base Rate Loans, Eurodollar Loans, or a combination thereof.
Notwithstanding any provision in this Agreement to the contrary, the parties
acknowledge and agree that upon any breach of Section 2.2.1, the Lenders'
obligation to make Revolving Loans is suspended until such breach is cured to
the reasonable satisfaction of the Required Lenders.
Section 2.2.2. Letters of Credit. On the terms and conditions hereinafter
set forth, the Agent shall from time to time during the period beginning on the
date of this Agreement and ending on the Facility A Termination Date, upon
request of Borrower, issue standby letters of credit for the account of the
Borrower or a Subsidiary for general corporate purposes in such amounts as the
Borrower may request but not to exceed in the aggregate face amount at any time
outstanding the sum of $2,500,000.00 (subject to the additional limitations on
the amounts thereof set forth in Section 2.2.3. below), each such letter of
credit shall have an expiry date no later than the earlier of one (1) year from
the date of issuance or the Termination Date, whichever occurs first (the
"Letters of Credit"); provided, however, a Letter of Credit may contain a
provision providing for the automatic extension of the expiration date in the
absence of a notice of non-renewal from the Agent but, except as provided below,
such provision shall not permit the extension of the expiration date of such
Letter of Credit beyond the Termination Date; and provided, further, that a
15
Letter of Credit may have an expiration date after the Termination Date if
Borrower provides not later than ninety (90) days prior to the Termination Date
cash collateral acceptable to Agent for any such Letter of Credit. On each day
during the period while any such Letter of Credit is issued and outstanding in
accordance with the provisions of this Agreement, the sum of the face amount of
each such outstanding Letter of Credit shall be treated as a Revolving Loan
under the Line of Credit. The Line of Credit Loan Commitment of each Lender
shall be deemed to be utilized for all purposes hereof in an amount equal to
such Lender's Commitment Percentage of the undrawn face amount of such Letter of
Credit. Each Lender agrees that, upon issuance of any Letter of Credit
hereunder, it shall automatically acquire a participation in the Agent's
liability under such Letter of Credit in an amount equal to such Lender's
Commitment Percentage of such liability, and each Lender (other than Agent)
thereby shall absolutely, unconditionally and irrevocably assume, as primary
obligor and not as surety, and shall be unconditionally obligated to Agent to
pay and discharge when due, its Commitment Percentage of Agent's liability under
such Letter of Credit, provided such Letter of Credit was issued in accordance
with the provisions of this Agreement. Borrower hereby unconditionally agrees to
pay and reimburse the Agent for the amount of each payment under any Letter of
Credit that is in substantial compliance with the provisions of such Letter of
Credit, without presentment, demand, or protest and in accordance with this
Section 2.2.2. Upon receipt from any beneficiary of any Letter of Credit of any
demand for payment under such Letter of Credit, the Agent shall promptly notify
the Borrower of the demand and the date upon which such payment is to be made by
the Agent to such beneficiary in respect of such demand. Forthwith upon receipt
of such notice from the Agent, Borrower shall advise the Agent whether or not it
intends to borrow under the Line of Credit to finance its obligations to
reimburse the Agent, and if so, submit a Request for Revolving Loan as provided
in Section 2.2.4. hereof.
Section 2.2.3. Procedure for Obtaining Letters of Credit. The amount and
date of issuance, renewal, extension or reissuance of a Letter of Credit
pursuant to the Section 2.2.2. shall be designated by the Borrower's written
request delivered to the Agent at least three (3) Business Days prior to the
date of such issuance, renewal, extension or reissuance. Concurrently with or
promptly following the delivery of the request for a Letter of Credit, the
Borrower shall execute and deliver to the Agent an application and agreement
with respect to the Letter of Credit, said application and agreement to be in
the form customarily used by the Agent. The terms of this Agreement shall
control in case of any conflict between the terms of this Agreement and the
Agent's form of application and agreement with respect to Letters of Credit. The
Agent shall not be obligated to issue, renew, extend or reissue such Letters of
Credit if (i) the Agent does not approve the requested form of the Letter of
Credit or any of the terms thereof, such approval not to be unreasonably
withheld, (ii) the amount thereon when added to the amount of the outstanding
Letters of Credit exceeds $2,500,000.00, or (iii) the amount thereof when added
to the total outstanding Revolving Loans under the Line of Credit would exceed
the Line of Credit Loan Commitment. Borrower agrees to pay the Agent a fee for
the issuance of each Letter of Credit, which fee shall be due and payable by the
Borrower to the Agent upon issuance of each Letter of Credit by the Agent and on
each anniversary date of such issuance while such Letter of Credit is
outstanding. The said fee shall be a per annum fee in the amount equal to the
lesser of either (a) 1.5% per annum or (b) the applicable Eurodollar Margin,
times the face amount of the Letter of Credit for such period (calculated
separately for each Letter of Credit).
16
Section 2.2.4. Manner and Notice of Borrowing Under the Line of Credit.
Requests For Revolving Loans under the Line of Credit may be made by the
Borrower, in writing (including facsimile transmission) to the Agent and such
requests shall be fully authorized by the Borrower if made by any one of the
persons designated by the Borrower in writing to the Agent. The form of Request
for Revolving Loan is attached hereto as Exhibit "B", and includes a designation
by Borrower of the Borrowing Date. The Agent shall have the right, but not the
obligation, to verify any telephone requests by calling the person who made the
request at the telephone number designated by the Borrower in writing to the
Agent. Requests For Revolving Loans must be received by not later than 11:00
a.m. (Central Time) (i) one (1) Business Day prior to the Borrowing Date in the
case of Base Rate Loans, or (ii) three (3) Business Days prior to any proposed
Borrowing Date in the case of Eurodollar Loans. Upon receipt of such Request for
Revolving Loan, the Agent shall advise each Lender thereof; provided, that if
the Lenders have received at least one (1) Business Day's notice of such
Revolving Loan prior to funding of a Base Rate Loan, or at least three (3)
Business Days' notice of each Revolving Loan prior to the funding in the case of
a Eurodollar Loan, each Lender shall provide the Agent at its office at 000
Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxx 00000, not later than 1:00 p.m.,
Central Time, on the Borrowing Date, in immediately available funds, its Pro
Rata share of the requested Revolving Loan, but the aggregate of all such
outstanding fundings by each Lender shall never exceed such Lender's available
Line of Credit Loan Commitment. Not later than 2:00 p.m., Central Time, on the
Borrowing Date, the Agent shall make available to Borrower the aggregate amount
of such requested Revolving Loan in the manner requested in the Request for
Revolving Loan. The Agent and the Lenders shall not incur any liability to
Borrower in acting upon any Request for Revolving Loan referred to above which
the Agent and the Lenders believe in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Borrower or
for otherwise acting in good faith under this Section 2.2.4. Each Request for
Revolving Loan for a Revolving Loan must specify whether such Loan is a
Eurodollar Loan or a Base Rate Loan. The aggregate outstanding amount of
principal and interest due by the Borrower at any given time under the Line of
Credit shall be and constitute the indebtedness of the Borrower to the Lenders
under the Notes made by the Borrower. When each Revolving Loan is made by the
Lenders to the Borrower hereunder, the Borrower shall be deemed to have renewed
and reissued the Notes for the amount of the Revolving Loan plus all amounts due
by the Borrower to the Lenders under the Line of Credit Loan Commitment
immediately prior to such Revolving Loan.
Section 2.2.5. Use of Proceeds. The Borrower shall use the proceeds of the
Revolving Loans to finance (i) the repayment in full of its existing senior debt
to XX Xxxxxxxxx, L.L.C., (ii) certain acquisitions and capital expenditures,
(iii) working capital, and (iv) other general corporate purposes.
Section 2.2.6. Several Obligations. The obligations of the Lenders under
the Line of Credit Loan Commitment are several and not joint. The failure of any
Lender to make a Revolving Loan required to be made by it shall not relieve any
other Lender of its obligation to make its Revolving Loan, and no Lender shall
be responsible for the failure of any other Lender to make the Revolving Loan to
be made by such other Lender.
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Section 2.3. Swing Line. Subject to the terms and conditions set forth
herein, the Swing Line Lender shall from time to time until the Termination
Date, upon the request of the Borrower, and provided that all of the applicable
conditions precedent specified in Section 10.2 have been satisfied, make loans
("Swing Line Loans") to the Borrower in an aggregate principal amount not to
exceed at any one time outstanding $7,500,000. Swing Line Loans shall be in any
amount and shall, unless otherwise expressly stated in this Agreement,
constitute "Loans" for all purposes hereunder, except they shall not be
considered a utilization of the Commitment of the Swing Line Lender or any other
Lender for purposes of calculating commitment fees hereunder. Notwithstanding
the foregoing sentence, the aggregate amount of all Loans (including all Swing
Line Loans) and outstanding Letters of Credit shall not at any time exceed the
aggregate of the Commitments. To request a Swing Line Loan, the Borrower shall
notify the Agent and the Swing Line Lender of such request by telephone no later
than 11:00 a.m., Lafayette, Louisiana, time, on the date of the proposed Swing
Line Loan, and shall confirm promptly by hand delivery or telecopy to the Agent
and the Swing Line Lender a written borrowing request in a form approved by the
Agent and signed by the Borrower. Each request for a Swing Line Loan shall be
irrevocable and shall state specifically that the Loan is to be a Swing Line
Loan and not a Revolving Loan, the amount of the Swing Line Loan requested, the
date on which such Swing Line Loan is to be made, which shall be a Business Day,
and how the proceeds of such Swing Line Loan are to be disbursed. All Swing Line
Loans shall bear interest at an annual rate equal to Base Rate from time to time
in effect plus or minus the Base Rate Margin from time to time in effect.
Subject to the terms and conditions of this Agreement, all Swing Line Loans may
be borrowed, prepaid and re-borrowed; provided that any and all such Swing Line
Loans then outstanding shall be due and payable in full on the earliest of (i)
on the first Business Day of each month, (ii) on the first date, after the date
that such Swing Line Loan is made, that a Revolving Loan is made, and (iii) the
Termination Date. At any time, but not less frequently than weekly, upon the
request of the Swing Line Lender, each Lender other than the Swing Line Lender
shall purchase a participating interest in any one or more Swing Line Loans in
an amount equal to the product of multiplying (x) its Commitment Percentage
times (y) the outstanding balance of such Swing Line Loans. No later than 1:00
p.m. Lafayette, Louisiana, time on the date such request is made (or on the next
Business Day, if such request is made after 11:00 a.m., Lafayette, Louisiana,
time), each Lender will transfer to the Swing Line Lender, in immediately
available funds, the amount of its participation. Whenever, at any time after
the Swing Line Lender has received from any Lender such Lender's participating
interest in a Swing Line Loan, the Swing Line Lender receives any payment on
account thereof, the Swing Line Lender will distribute to such Lender its
participating interest in such amount (appropriately adjusted, in the case of
interest payments, to reflect the period of time during which such Lender's
participating interest was outstanding and funded); provided, however, that in
the event that such payment received by the Swing Line Lender is required to be
returned, such Lender will return to the Swing Line Lender any portion thereof
previously distributed by the Swing Line Lender to it. Each Lender's obligation
to purchase such participating interests shall be absolute and unconditional and
shall not be affected by any circumstances, including, without limitation, (i)
any set-off, counterclaim, recoupment, defense or other rights which such Lender
or any other Person may have against the Swing Line Lender or any other Person
for any reason whatsoever; (ii) the occurrence or existence of a Default or an
Event of Default or the termination of the Commitments; (iii) any adverse change
in the condition (financial or otherwise) of the Borrower or any other Person;
(iv) any breach of this Agreement by the Borrower or any other Person; or (v)
any other circumstance, happening or event whatsoever, whether or not similar to
any of the foregoing. Each Swing Line Loan, once so participated, shall cease to
be a Swing Line Loan for purposes of this Agreement and shall become a Revolving
Loan.
18
ARTICLE III
NOTES EVIDENCING THE REVOLVING LOANS
------------------------------------
Section 3.1. Notes.
Section 3.1.1. Form of Notes. The Revolving Loan shall be evidenced by the
Revolving Notes in the aggregate face amount of the Line of Credit Loan
Commitment. Notwithstanding the face amount of the Notes, the actual principal
amount due from Borrower to the Lenders on account of the Notes, as of any date
of computation, shall be the sum of Revolving Loans then and theretofore made on
account thereof, less all principal payments actually received by Lenders in
collected funds with respect thereto. Although the Notes are dated of even date
herewith, interest in respect thereof shall be payable only for the period
during which the loans evidenced thereby are outstanding and, although the
stated amount of the Notes may be higher, the Notes shall be enforceable, with
respect to Borrower's obligation to pay the principal amount thereof, only to
the extent of the unpaid principal amount of the Revolving Loans.
Section 3.1.2. Issuance of Additional Notes. From time to time new Notes
may be issued to other Lenders as such Lenders become parties to this Agreement.
Upon request from the Agent, Borrower shall execute and deliver to Agent any
such new or additional Notes. From time to time as new Notes are issued the
Agent shall require that each Lender exchange their Notes for newly issued Notes
to reflect the amount of each Lender's Commitment hereunder. The Agent shall,
upon the written request of Borrower, cause the Lenders to return to Borrower
the Notes which have been replaced within a reasonable period of time after
Borrower's request. Under no circumstances will the issuance of new Notes, or
the return of the Notes to the Borrower which have been replaced, constitute a
novation or other discharge of the outstanding indebtedness of Borrower to the
Lenders under the Line of Credit.
Section 3.1.3. Payment of the Notes. Subject to the requirements of Article
VIII below, interest on the unpaid principal balance of the Notes shall be
payable on each Interest Payment Date and on the Termination Date. Subject to
the requirements of Article VIII below, the outstanding principal due under the
Notes shall be due and payable on the Termination Date.
Section 3.1.4. Payment to the Lenders. Each Lender's Pro Rata Part of
payment or prepayment of the Loans shall be directed by wire transfer to such
Lender by the Agent at the address provided to the Agent for such Lender for
payments no later than 2:00 p.m., Lafayette, Louisiana, time on the Business Day
such payments or prepayments are deemed hereunder to have been received by
Agent; provided, however, in the event that any Lender shall have failed to make
a Revolving Loan as contemplated under Article II hereof (a "Defaulting Bank")
and the Agent or another Lender or Lenders shall have made such Revolving Loan,
payment received by Agent for the account of such Defaulting Bank(s) shall not
be distributed to such Defaulting Bank(s) until such Revolving Loan or Revolving
Loans shall have been repaid in full to the Lender or Lenders who funded such
Revolving Loan or Revolving Loans. For the sole purpose of calculating interest,
any payment or prepayment received by the Agent at any time after 12:00 noon,
Lafayette, Louisiana, time on a Business Day shall be deemed to have been
received on the next Business Day. Interest shall cease to accrue on any
principal as of the end of the day preceding the Business Day on which any such
payment or prepayment is deemed hereunder to have been received by the Agent. If
the Agent fails to transfer any principal amount to any Lender as provided
above, then the Agent shall promptly direct such principal amount by wire
transfer to such Lender.
19
Section 3.1.5. Sharing of Payments, Etc. If any Lender shall obtain any
payment (whether voluntary, involuntary, or otherwise) on account of the Loans,
(including, without limitation, any set-off) which is in excess of its Pro Rata
Part of payments on the Loans, as the case may be, obtained by all Lenders, such
Lender shall purchase from the other Lenders such participation as shall be
necessary to cause such purchasing Lender to share the excess payment pro rata
with each of them; provided that, if all or any portion of such excess payment
is thereafter recovered from such purchasing Lender, the purchase shall be
rescinded and the purchase price restored to the extent of the recovery.
Borrower agrees that any Lender so purchasing a participation from another
Lender pursuant to this Section may, to the fullest extent permitted by law,
exercise all of its rights of payment (including the right of offset) with
respect to such participation as fully as if such Lender were the direct
creditor of Borrower in the amount of such participation.
Section 3.1.6. Non-Receipt of Funds by the Agent Unless the Agent shall
have been notified by a Lender or Borrower (the "Payor") prior to the date on
which such Lender is to make payment to the Agent of the proceeds of a Revolving
Loan to be made by it hereunder or Borrower is to make a payment to the Agent
for the account of one or more of the Lenders, as the case may be (such payment
being herein called the "Required Payment"), which notice shall be effective
upon receipt, that the Payor does not intend to make the Required Payment to the
Agent, the Agent may assume that the Required Payment has been made and may, in
reliance upon such assumption (but shall not be required to), make the amount
thereof available to the intended recipient on such date and, if the Payor has
not in fact made the Required Payment to the Agent, the recipient of such
payment shall, on demand, pay to the Agent the amount made available to it
together with interest thereon in respect of the period commencing on the date
such amount was made available by the Agent until the date the Agent recovers
such amount at the rate applicable to such portion of the applicable Revolving
Loan. Any payment due from any Lender to Agent pursuant hereto shall bear
interest at the Federal Funds Rate.
ARTICLE IV
INTEREST RATES
--------------
Section 4.1. Options.
Section 4.1.1. Base Rate Loans. On Base Rate Loans, Borrower agrees to pay
interest monthly calculated on the basis of a year consisting of 365/360 days
with respect to the unpaid principal amount of each Base Rate Loan from the date
the proceeds thereof are made available to Borrower until maturity (whether by
acceleration or otherwise), at a varying rate per annum equal to the lesser of
(i) the Maximum Rate and (ii) the Base Rate plus or minus the Base Rate Margin.
Past due principal, to the extent permitted by law, shall bear interest, payable
upon demand, at the lesser of (i) the Maximum Rate and (ii) the default rate
specified in the Notes.
20
Section 4.1.2. Eurodollar Loans. On Eurodollar Loans, Borrower agrees to
pay interest calculated on the basis of a year consisting of 360 days with
respect to the unpaid principal amount of each Eurodollar Loan from the date the
proceeds thereof are made available to Borrower until maturity (whether by
acceleration or otherwise), at a varying rate per annum equal to the lesser of
(i) the Maximum Rate and (ii) the Eurodollar Rate plus the Eurodollar Margin.
Past due principal, to the extent permitted by law, shall bear interest, payable
on demand, at the lesser of (i) the Maximum Rate and (ii) the default rate
specified in the Notes. Unless otherwise requested by Borrower, upon the
expiration of each Interest Period applicable to Eurodollar Loans, the Borrower
shall be deemed to have elected to maintain all applicable Eurodollar Loans as
Eurodollar Loans with an Interest Period of one (1) month.
Section 4.2. Interest Rate Determination. The Agent shall determine each
interest rate applicable to any Base Rate Loan or Eurodollar Loan and its
determination shall be conclusive absent manifest error. The Agent shall notify
the Borrower of each interest rate determination within a reasonable time after
each such determination.
Section 4.3. Conversion Option. Borrower may elect from time to time (i) to
convert all or any part of its Eurodollar Loans to Base Rate Loans by giving the
Agent irrevocable notice of such election in writing prior to 11:00 a.m.
(Lafayette, Louisiana time) on the conversion date and such conversion shall be
made on the requested conversion date, provided that any such conversion of
Eurodollar Loan shall only be made on the last day of the Eurodollar Interest
Period with respect thereof, and (ii) to convert all or any part of its Base
Rate Loans to Eurodollar Loans by giving the Agent irrevocable written notice of
such election three (3) Business Days prior to the proposed conversion and such
conversion shall be made on the requested conversion date or, if such requested
conversion date is not a Business Day on the next succeeding Business Day;
provided, however, the conversion amount shall not be less than $1,000,000.00.
Any such conversion shall not be deemed a prepayment of any Note or a prepayment
of any of the Loans for purposes of this Agreement.
ARTICLE V
CHANGE OF CIRCUMSTANCES
-----------------------
Section 5.1. Unavailability of Funds or Inadequacy of Pricing. In the event
that, in connection with any proposed Eurodollar Loan, the Agent reasonably
determines, which determination shall, absent manifest error, be final,
conclusive and binding upon all parties, due to changes in circumstances since
the date hereof, adequate and fair means do not exist for determining the
Eurodollar Rate or such rate will not accurately reflect the costs to the
Lenders of funding Eurodollar Loans for such Eurodollar Interest Period, the
Agent shall give notice of such determination to the Borrower, whereupon, until
the Agent notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, the obligation of the Lenders to make, continue or
convert Loans into Eurodollar Loans shall be suspended, and all loans to
Borrower shall be Base Rate Loans during the period of suspension.
21
Section 5.2. Change in Laws. If at any time after the date hereof any new
law or any change in existing laws or in the interpretation by any governmental
authority, central bank, or comparable agency charged with the administration or
interpretation thereof, of any new or existing laws shall make it unlawful for
the such Lender to make or continue to maintain or fund Eurodollar Loans
hereunder, then such Lender shall promptly notify Borrower in writing of such
Lender's obligation to make, continue or convert Loans into Eurodollar Loans
under this Agreement shall be suspended until it is no longer unlawful for such
Lender to make or maintain Eurodollar Loans. Upon receipt of such notice,
Borrower shall either repay the outstanding Eurodollar Loans owed to the
Lenders, without penalty, on the last day of the current Interest Periods (or,
if any Lender may not lawfully continue to maintain and fund such Eurodollar
Loans, immediately), or Borrower may convert such Eurodollar Loans at such
appropriate time to Base Rate Loans.
Section 5.3. Increased Cost or Reduced Return. (i) If, after the date
hereof, the adoption of any applicable law, rule, or regulation, or any change
in any applicable law, rule, or regulation, or any change in the interpretation
or administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation or administration thereof, or
compliance by any Lender with any request or directive (whether or not having
the force of law) of any such governmental authority, central bank, or
comparable agency:
(A) shall subject such Lender to any tax, duty, or other charge with
respect to any Eurodollar Loans, the Notes, or its obligation to make
Eurodollar Loans, or change the basis of taxation of any amounts
payable to such Lender under this Agreement, or the Notes, in respect
of any Eurodollar Loans (other than franchise taxes and taxes imposed
on the overall net income of such Lender);
(B) shall impose, modify, or deem applicable any reserve, special deposit,
assessment, or similar requirement (other than reserve requirements,
if any, taken into account in the determination of the Eurodollar
Rate) relating to any extensions of credit or other assets of, or any
deposits with or other liabilities or commitments of, such Lender,
including the Commitment of such Lender hereunder; or
(C) shall impose on such Lender or on the London interbank market any
other condition affecting this Agreement or its Notes or any of such
extensions of credit or liabilities or commitments;
22
and the result of any of the foregoing is to increase in a material respect the
cost to such Lender of making, converting into, continuing, or maintaining any
Eurodollar Loans or to reduce in a material respect any sum received or
receivable by such Lender under this Agreement or its Note with respect to any
Eurodollar Loans, then pursuant to Section 5.3(v) Borrower shall pay to such
Lender such amount or amounts as are reasonably necessary to compensate such
Lender for such increased cost or reduction. If such Lender requests
compensation by Borrower under this Section 5.3., Borrower may, by notice to
such Lender, suspend the obligation of such Lender to make or continue
Eurodollar Loans, or to convert all or part of the Base Rate Loans owing to such
Lender to Eurodollar Loans, until the event or condition giving rise to such
request ceases to be in effect; provided that such suspension shall not affect
the right of such Lender to receive the compensation so requested.
(ii) If, after the date hereof, such Lender shall have
reasonably determined that the adoption of any applicable law, rule, or
regulation regarding capital adequacy or any change therein or in the
interpretation or administration thereof by any governmental authority, central
bank, or comparable agency charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy (whether or not
having the force of law) of any such governmental authority, central bank, or
comparable agency, has or would have the effect of reducing the rate of return
on the capital of such Lender or any corporation controlling Lender as a
consequence of such Lender's obligations hereunder to a level below that which
such Lender or such corporation could have achieved but for such adoption,
change, request, or directive (taking into consideration its policies with
respect to capital adequacy), then from time to time pursuant to Section 5.3(v)
Borrower shall pay to such Lender such additional amount or amounts as are
reasonably necessary to compensate Lender for such reduction.
(iii) Each Lender shall promptly notify Borrower of any event
of which it has knowledge, occurring after the date hereof, which will entitle
such Lender to compensation pursuant to this Section 5.3. Each Lender will
designate a separate lending office, if applicable, if such designation will
avoid the need for, or reduce the amount of, such compensation and will not, in
the judgment of such Lender, be otherwise disadvantageous to it.
(iv) If any Lender gives notice to the Borrower (either by
Lender or through the Agent) pursuant to Section 5.3. hereof, Lender shall
simultaneously give to the Borrower a statement signed by an officer of such
Lender setting forth in reasonable detail the basis for, and the calculation of
such additional cost, reduced payments or capital requirements, as the case may
be, and the additional amounts required to compensate Lender therefor.
(v) Within fifteen (15) days after receipt by the Borrower
of any notice referred to in Section 5.3., the Borrower shall pay to such Lender
such additional amounts as are required to compensate such Lender for the
increased cost, reduce payments or increase capital requirements identified
therein, as the case may be; provided, that the Borrower shall not be obligated
to compensate such Lender for any increased costs, reduced payments or increased
capital requirements to the extent that such Lender incurs the same prior to a
date six (6) months before such Lender gives the required notice.
23
Section 5.4. Breakage Costs. Without duplication under any other provision
hereof, if any Lender incurs any actual loss, cost, expense or premium
reasonably incurred by reason of the liquidation or re-employment of deposits or
other funds acquired by such Lender to fund or maintain any Eurodollar Loan or
the relending or reinvesting of such deposits or amounts paid or prepaid to such
Lender as a result of any of the following events other than any such occurrence
as a result in the change of circumstances described in Sections 5.1. and 5.2.:
(i) any payment, prepayment or conversion of a Eurodollar
Loan on a date other than the last day of its Eurodollar Interest
Period (whether by acceleration, prepayment or otherwise);
(ii) any failure to make a principal payment of a Eurodollar
Loan on the due date thereof; or
(iii) any failure by the Borrower to borrow, continue,
prepay or convert to a Eurodollar Loan on the dates specified in
a notice given pursuant to this Agreement.
then the Borrower shall within 15 days after demand pay to such Lender such
amount as is reasonably necessary to compensate such Lender for such loss, cost
or expense. If such Lender makes such a claim for compensation, it shall
simultaneously furnish to Borrower a statement setting forth the amount of such
loss, cost or expense in reasonable detail (including an explanation of the
basis for and the computation of such loss, cost or expense) and the amounts
shown on such statement shall be conclusive and binding absent manifest error.
Section 5.5. Discretion of Lender as to Manner of Funding. Notwithstanding
any provisions of this Agreement to the contrary, each Lender shall be entitled
to fund and maintain its funding of all or any part of its Revolving Loans in
any manner it sees fit, it being understood, however, that for the purposes of
this Agreement all determinations hereunder, except as may otherwise be provided
in this Article V, shall be made as if each Lender had actually funded and
maintained each Eurodollar Loan through the purchase of deposits having a
maturity corresponding to the last day of the Eurodollar Interest Period
applicable to such Eurodollar Loan and bearing an interest rate to the
applicable interest rate for such Eurodollar Period.
Section 5.6. Foreign Lenders. Any Foreign Lender that is entitled to an
exemption from or reduction of withholding tax under the law of the jurisdiction
in which the Borrower is resident for tax purposes, or any treaty to which such
jurisdiction is a party, with respect to payments hereunder or under any other
Loan Document shall deliver to the Borrower (with a copy to the Agent), at the
time or times prescribed by applicable law or reasonably requested by the
Borrower or the Agent, such properly completed and executed documentation
prescribed by applicable law as will permit such payments to be made without
withholding or at a reduced rate of withholding. In addition, any Lender, if
requested by the Borrower or the Agent, shall deliver such other documentation
prescribed by applicable law or reasonably requested by the Borrower or the
Agent as will enable the Borrower or the Agent to determine whether or not such
Lender is subject to backup withholding or information reporting requirements.
As used in this Section, the term "Foreign Lender" means any Lender that is
organized under the laws of a jurisdiction other than that in which the Borrower
is resident for tax purposes (it being understood that for purposes of this
definition, the United States of America, each State thereof and the District of
Columbia shall be deemed to constitute a single jurisdiction).
24
ARTICLE VI
FEES
----
Section 6.1. Facility Fees. The Borrower shall pay to the Agent for the
benefit of the Lenders a facility fee of 0.125% of the Commitment. The foregoing
facility fee shall be due and payable on the date hereof and, the Borrower
hereby authorizes the Agent to debit its account specified on Schedule 6
attached hereto and maintained with Capital One for collection of the foregoing
facility fee.
Section 6.2. Unused Fees. The Borrower shall pay to the Agent (for the Pro
Rata benefit of the Lenders) an unused fee calculated as follows: (i) if the
Leverage Ratio as set forth in the Compliance Certificate most recently
delivered by the Borrower pursuant to Section 12.1(c) is less than 1.50 to 1.0,
then the unused fee for such period set forth in the applicable Compliance
Certificate will be the amount equal to 0.25% times the Unused Amount; and (ii)
if the Leverage Ratio as set forth in the Compliance Certificate most recently
delivered by the Borrower pursuant to Section 12.1(c) is greater than or equal
to 1.50 to 1.0, then the unused fee will be the amount equal to 0.375% times the
Unused Amount. If the Borrower fails to deliver a Compliance Certificate
pursuant to Section 12.1(c), the unused fee shall equal the percentage
corresponding to item (ii) of this Section 6.2 until the date of the delivery of
the required Compliance Certificate. The unused portion of the Line of Credit
Commitment shall be determined on a daily basis by subtracting the Total
Outstandings from the Commitments, and by averaging said daily amounts for such
period set forth in the applicable Compliance Certificate for which the fee is
to be determined (the "Unused Amount"). The foregoing unused fee to be paid in
arrears upon notice from the Agent to the Borrower after the delivery of a
Compliance Certificate delivered by the Borrower pursuant to Section 12.1(c) and
on the Termination Date; provided however the first unused fee due hereunder
shall be due and payable on April 30, 2008 (for the prorated portion of the fee
for the first quarter of 2008). On the day of such notice to the Borrower, the
Borrower hereby authorizes the Agent to debit its account specified on Schedule
6 attached hereto and maintained with Capital One for collection of the
foregoing unused fee.
Section 6.3. Letter of Credit Fee. The Borrower shall pay to the Agent (for
the Pro Rata benefit of the Lenders) a fee for each Letter of Credit as provided
in Sections 2.2.3. of this Agreement. The foregoing fee shall be due and payable
at least one (1) Business Day prior to the issuance of a Letter of Credit. The
Borrower hereby authorizes the Agent to debit its account specified in Schedule
6 attached hereto and maintained with Capital One for the collection of said
fee.
25
ARTICLE VII
CERTAIN GENERAL PROVISIONS
--------------------------
Section 7.1. Payments. All payments of principal, interest, fees and any
other amounts due hereunder or under any of the other Related Documents shall be
made to the Agent at its office in New Orleans, Louisiana at 000 Xxxxxxxxxx
Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxx 00000, or at such other location that the Agent
may from time to time designate in writing to the Borrower, in each case in
immediately available funds.
Section 7.2. No Offset, etc. All payments by the Borrower hereunder and
under any of the other Related Documents shall be made without setoff and free
and clear of and without deduction for any taxes, levies, imposts, duties,
charges, fees, deductions, withholdings, compulsory loans, restrictions or
conditions of any nature now or hereafter imposed or levied by any jurisdiction
or any political subdivision thereof or taxing or other authority therein unless
the Borrower is compelled by law to make such deduction or withholding. If any
such obligation is imposed upon the Borrower with respect to any amount payable
by it hereunder or under any of the other Loan Documents, the Borrower will pay
to the Agent, on the date on which such amount is due and payable hereunder or
under such other Related Document, such additional amount in Dollars as shall be
necessary to enable the Lender to receive the same net amount which the Lender
would have received on such due date had no such obligation been imposed upon
the Borrower. The Borrower will deliver promptly to the Agent certificates or
other valid vouchers for all taxes or other charges deducted from or paid with
respect to payments made by the Borrower hereunder or under such other Loan
Documents.
Section 7.3. Rate Management Transactions. The Borrower is permitted to
enter into Rate Management Transactions with the Lenders (and/or their
affiliates).
Section 7.4. Calculation of Fees. The fees set forth in Article VI above
will be calculated on the basis of a year consisting of 360 days.
ARTICLE VIII
PREPAYMENTS
-----------
Section 8.1. Voluntary Prepayments. Borrower may at any time and from time
to time, without premium or penalty, prepay Base Rate Loans. Borrower may at any
time and from time to time, without penalty or premium subject to Section 5.4.
hereof, prepay Eurodollar Loans outstanding upon at least three (3) Business
Day's notice to the Agent.
Section 8.2. Mandatory Prepayment Resulting From Overadvances. In the event
the unpaid principal amount of the Revolving Loans ever exceeds the Line of
Credit Loan Commitment, the Borrower unconditionally agrees, within five (5)
days after notice from Agent of the occurrence of such an excess amount (an
"overadvance") to make a lump sum payment to the Agent in an amount equal to the
overadvance.
26
ARTICLE IX
SECURITY FOR THE INDEBTEDNESS
-----------------------------
Section 9.1. Security. The Indebtedness shall be secured by the following:
(a) the Guaranty;
(b) the Pledge Agreement; and
(c) any other Collateral Documents granted by any Person in favor of
Agent for the ratable benefit of the Lenders as security for the Indebtedness.
ARTICLE X
CONDITIONS PRECEDENT
--------------------
Section 10.1. Condition Precedent to Effectiveness of this Agreement. The
effectiveness of this Agreement shall be subject to the satisfaction of the
following conditions precedent:
(a) On or prior to the date hereof, the Borrower shall have executed and
delivered to the Agent this Agreement and the Notes;
(b) On or prior to the date hereof, the Guarantors shall have executed
and delivered to the Agent the Guaranty;
(c) On or prior to the date hereof, the Subsidiaries of Borrower that
are executing the Pledge Agreement shall have executed and delivered to Agent
the Pledge Agreement and the original certificates, if any, evidencing the
interests of said Subsidiaries in the entities described in the Pledge
Agreement;
(d) On or prior to the date hereof, the Agent shall have received a
favorable legal opinion of counsel to the Borrower covering the transactions
contemplated by this Agreement, in form, scope and substance satisfactory to the
Agent;
(e) The Agent shall have received certified resolutions of the Borrower
and the Guarantor authorizing the execution of all documents and instruments
contemplated by this Agreement;
(f) The Agent shall have received all fees, charges and expenses which
are due and payable as specified in this Agreement and any Loan Documents;
27
(g) On or prior to the date hereof, the Agent shall have received the
organizational and governance documents, as amended, of the Borrower and each
Guarantor, and the Agent's counsel shall have reviewed the foregoing documents
and is satisfied with the validity, due authorization and enforceability
thereof;
(h) On or prior to the date hereof, the Borrower shall have delivered to
the Agent an insurance certificate detailing all insurance coverage for the
Borrower and the Subsidiaries;
(i) The Agent shall have received executed commitments from each of the
Lenders for their respective portions of the Commitment; and
(j) The Agent and the Lenders party to the Original Agreement shall have
returned the Notes delivered in connection with the Original Agreement.
The Agent and the Lenders reserve the right, in their sole discretion, to
waive any one or more of the foregoing conditions precedent.
Section 10.2. Conditions Precedent to All Revolving Loans. The obligation
of the Lenders to make any Revolving Loan hereunder and the obligation of Agent
to issue a Letter of Credit and to make any Swing Line Loan are all subject to
the further condition precedent that:
(a) The representations and warranties of the Borrower as set forth in
this Agreement, or in any Loan Document furnished to the Agent and/or any Lender
in connection herewith, shall be and remain true and correct in all material
respects on and as of the date of the making of such Loan or date of issuance of
such Letter of Credit (except to the extent specifically limited to a specified
date);
(b) No Default or Event of Default shall exist or shall result from the
making of a Revolving Loan or the issuance of a Letter of Credit;
(c) The Borrower shall have complied with the procedure set forth in
this Agreement, for the requesting of a Revolving Loan or the issuance of a
Letter of Credit, as the case may be; and
(d) There shall have occurred no Material Adverse Effect since the date
of the most recent financial statements delivered by Borrower to Agent.
The Agent and the Lenders reserve the right, in their sole discretion, to
waive any one or more of the foregoing conditions precedent.
28
ARTICLE XI
REPRESENTATIONS AND WARRANTIES
------------------------------
The Borrower represents and warrants to the Agent and the Lenders as
follows:
Section 11.1. Corporate Authority of the Borrower. The Borrower is a
corporation duly created, validly existing, and in good standing under the laws
of the State of Delaware, and is duly qualified and in good standing as foreign
corporation in Louisiana and all other jurisdictions where the failure to
qualify would have a material adverse effect upon its ability to perform its
obligations under this Agreement and all Loan Documents to which it is a party.
The Borrower has the corporate power to enter into this Agreement and execute
the Notes. The Borrower has the corporate power to perform its obligations
hereunder and under the Loan Documents. The execution, delivery, and performance
by the Borrower of the Loan Documents have all been duly authorized by all
necessary corporate or company action, and do not and will not result in any
violation by the Borrower of any provision of any law, rule, regulation, order,
writ, judgment, decree, determination or award presently in effect having
applicability to the Borrower, or the articles of incorporation and bylaws of
the Borrower. The making and performance by the Borrower of the Loan Documents
do not and will not result in a breach of or constitute a default under any
material indenture or loan or credit agreement or any other material agreement
or instrument to which the Borrower is a party or by which it may be bound or
affected, or result in, or require, the creation or imposition of any mortgage,
deed of trust, pledge, lien, security interest or other charge or encumbrance of
any nature (other than as contemplated by the Loan Documents) upon or with
respect to any of the properties now owned or hereafter acquired by the
Borrower. Each of the Loan Documents to which the Borrower is a party
constitutes a legal, valid and binding obligation of the Borrower, enforceable
against the Borrower in accordance with its respective terms except as the same
may be limited by bankruptcy, insolvency, and other similar laws affecting the
rights of creditors generally and the availability of equitable remedies for the
enforcement of certain obligations (other than the payment of principal)
contained herein or therein and as may be limited by equitable principles
generally.
Section 11.2. Financial Statements. The most recent balance sheet of the
Borrower at the dates thereof, and the related statements of income and retained
earnings for the period then ended, copies of which have been delivered to the
Agent, fairly present in all material respects the financial condition of the
Borrower as of the date or dates thereof. Each of said financial statements
(including in each case related schedules and notes) were prepared in conformity
with GAAP and, except as otherwise disclosed to Agent in writing, applied on a
basis consistent with the preceding year (subject, as to interim statements, to
changes resulting from normal year-end audit adjustments and absence of the full
footnote disclosure). No Material Adverse Effect has occurred since September
30, 2007 in the financial position or in the results of operations of the
Borrower and its Subsidiaries taken as a whole.
Section 11.3. Litigation. Other than as set forth in Schedule 11.3 and as
may be disclosed to the Agent in writing after the date of this Agreement, there
are no legal actions, suits or proceedings pending or, to the best knowledge of
the Borrower threatened, against or adversely and materially affecting the
29
Borrower, or any of its properties before any court or administrative agency
(federal, state or local), which could reasonably be expected to constitute a
Material Adverse Effect, and there are no judgments or decrees affecting the
Borrower, or its property (including, without limitation, the Collateral) which
are or could reasonably be expected to become an Encumbrance against such
property (other than a Permitted Encumbrance), provided that no breach of this
Section 11.3 shall occur if the same is discharged within thirty days after the
date of entry thereof or an appeal or appropriate proceeding for review thereof
is taken within such period and a stay of execution pending such appeal is
obtained.
Section 11.4. Approvals. No authorization, consent, approval or formal
exemption of, nor any filing or registration with, any governmental body or
regulatory authority (federal, state or local), and no vote, consent or approval
of the shareholders of the Borrower is or will be required in connection with
the execution and delivery by the Borrower of the Loan Documents or the
performance by the Borrower of its obligations hereunder and under the other
Loan Documents, except to the extent obtained.
Section 11.5. Required Insurance. The Borrower maintains insurance with
insurance companies in such amounts and against such risks as is usually carried
by owners of similar businesses and properties in the same general areas in
which Borrower operates.
Section 11.6. Licenses. The Borrower possesses adequate franchises,
licenses and permits to own its properties and to carry on its business as
presently conducted, except where the failure to do so could not reasonably be
expected to have a Material Adverse Effect.
Section 11.7. Adverse Agreements. The Borrower is not a party to any
agreement or instrument, nor subject to any charter or other restriction,
materially and adversely affecting the business, properties, assets, or
operations of the Borrower or its condition (financial or otherwise), and the
Borrower is not in default in the performance, observance or fulfillment of any
of the obligations, covenants or conditions contained in any agreement or
instrument to which it is a party, which default would constitute a Material
Adverse Effect.
Section 11.8. Default or Event of Default. No Default or Event of Default
hereunder has occurred and is continuing or will occur as a result of the giving
effect hereto.
Section 11.9. Employee Benefit Plans. Each employee pension benefit plan
(other than a Multiemployer Plan) which is covered by Title IV of ERISA or
subject to the minimum funding standards under Section 412 of the Internal
Revenue Code as to which the Borrower may have any liability complies in all
material respects with all applicable requirements of law and regulations,
except in each case for non compliance which could not reasonably be expected to
have a Material Adverse Effect, and (i) no Reportable Event (as defined in
ERISA) has occurred and is continuing with respect to any such plan, (ii) the
Borrower has not withdrawn from any such plan or initiated steps to do so, and
(iii) no steps have been taken to terminate any such plan.
Section 11.10. Investment Company Act. 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.
30
Section 11.11. Intentionally Omitted.
Section 11.12. Regulations X, T and U. The Borrower is not engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying margin stock (within the
meaning of Regulations X, T and U of the Board of Governors of the Federal
Reserve System), and none of the proceeds of the Loans will be used for the
purpose of purchasing or carrying such margin stock.
Section 11.13. Location of Offices and Records. As of the date hereof, the
chief place of business of the Borrower, and the office where the Borrower keeps
its books and records is 000 Xxxx Xxxxxxx Xxxx, Xxxxx X, Xxxxxxxxx, Xxxxxxxxx
00000.
Section 11.14. Information. All written information heretofore or
contemporaneously herewith furnished by the Borrower to the Agent and/or the
Lenders for the purposes of or in connection with this Agreement or any
transaction contemplated hereby (excluding projections, estimates, and
engineering reports) is, and all such information hereafter furnished by or on
behalf of the Borrower to the Agent and/or the Lenders will be, true and
accurate in every material respect on the date as of which such information is
dated or certified; and none of such information, taken as a whole, is or will
be incomplete by omitting to state any material fact necessary to make such
information not misleading as of such date, taken as a whole.
Section 11.15. Environmental Matters. Except as previously disclosed to the
Agent in writing or as could not reasonably be expected to result in a Material
Adverse Effect:
(a) To the best of Borrower's knowledge and belief after due inquiry,
Borrower and each Guarantor are in compliance with all applicable Environmental
Laws;
(b) To the best of Borrower's knowledge and belief after due inquiry,
Borrower and each Guarantor have obtained all consents and permits required
under all applicable Environmental Laws to operate its business as presently
conducted or as proposed to be conducted and all such consents and permits are
in full force and effect and Borrower and each Guarantor are in compliance with
all terms and conditions of such approvals;
(c) To the best of Borrower's knowledge and belief after due inquiry,
the Borrower, each Guarantor and their respective properties and operations are
not subject to any order from or agreement with any Governmental Authority or
private party respecting (i) failure to comply with any Environmental Law or any
Remedial Action or (ii) any Environmental Liabilities arising from the Release
or threatened Release except those orders and agreements with which Borrower and
Guarantor have complied;
(d) To the best of Borrower's knowledge and belief after due inquiry,
none of the operations of Borrower or any Guarantor is subject to any judicial
or administrative proceeding alleging a violation of, or liability under, any
Environmental Law;
31
(e) None of the operations of Borrower or any Guarantor, to its best
knowledge after due inquiry, is the subject of any investigation by any
Governmental Authority evaluating whether any Remedial Action is needed to
respond to a Release or threatened Release;
(f) Borrower and any Guarantor have not been required to file any notice
under any Environmental Law indicating past or present treatment, storage or
disposal of a hazardous waste as defined by 40 CFR Part 261 or any state or
local equivalent;
(g) Borrower and Guarantor have not been required to file any notice
under any applicable Environmental Law reporting a Release;
(h) There have been no written commitments or agreements involving
Borrower or any Guarantor from or with any Governmental Authority or any private
entity (including, without limitation, the owner of the Mortgaged Properties or
any portion thereof) relating to the generation, storage, treatment, presence,
Release, or threatened Release;
(i) Borrower and/or Guarantor has not received any written notice or
claim to the effect that it is or may be liable to any Person as a result of the
Release or threatened Release;
(j) To the best of Borrower's knowledge and belief after due inquiry,
Borrower and Guarantor have no known liability in connection with any material
Release or material threatened Release;
(k) After due inquiry, no Environmental Lien has attached (and continues
to attach) to any properties of Borrower or any Guarantor, provided that no
breach of this Section 11.15(l) shall occur if the same is discharged within
thirty days after the attachment thereof or an appeal or other appropriate
proceeding for review thereof is taken within said thirty day period and/or a
stay of execution pending such appeal is obtained; and
(l) To the Borrower's best knowledge after due inquiry, there have been
no environmental investigations, studies, audits, tests, reviews or other
analyses conducted by or which are in the possession of Borrower or any
Guarantor in relation to any violation of Environmental Laws which violation
could reasonably be expected to have a Material Adverse Effect in relation to
any properties or facility now or previously owned or leased by Borrower which
have not been made available to Agent.
Section 11.16. Solvency of the Borrower. The Borrower is and after
consummation of the transactions contemplated by this Agreement (including the
making of the Revolving Loans and the issuance of Letters of Credit), and after
giving effect to all obligations incurred by the Borrower in connection
herewith, will be, Solvent.
Section 11.17. Governmental Requirements. The properties, assets, and
business of the Borrower are in compliance with all current governmental
requirements affecting same, except where failure could not reasonably be
expected to have a Material Adverse Effect.
32
Section 11.18. Authority of the Guarantor. Each Guarantor is duly created,
validly existing, and in good standing under the laws of the state of its
formation, and is duly qualified and in good standing as foreign entity in all
other jurisdictions where the failure to qualify would have material adverse
effect upon its ability to perform their obligations under the Guaranty. Each
Guarantor has the power to enter into the Guaranty and the other Loan Documents
to which it is a party, and to perform its obligations thereunder. The making
and performance by the Guarantor of the Guaranty and the other Loan Documents to
which it is a party, have all been duly authorized by all necessary action, and
do not and will not violate any provision of any law, rule, regulation, order,
writ, judgment, decree, determination or award presently in effect having
applicability to such Guarantor, or governing documents of such Guarantor. The
making and performance by each Guarantor of the Guaranty and the other Loan
Documents to which it is a party, do not and will not result in a breach of or
constitute a default under any material indenture or loan or credit agreement or
any other material agreement or instrument to which such Guarantor is a party or
by which it may be bound or affected, or result in, or require, the creation or
imposition of any mortgage, deed of trust, pledge, lien, security interest or
other charge or encumbrance of any nature (other than as contemplated by the
Related Documents) upon or with respect to any of the properties now owned or
hereafter acquired by such Guarantor, and such Guarantor is not in default under
or in violation of any such order, writ, judgment, decree, determination, award,
indenture, agreement or instrument to the extent any such default or violation
could reasonably be expected to have a Material Adverse Effect. The Guaranty
constitutes a legal, valid and binding obligation of the Guarantor, enforceable
against the Guarantor in accordance with its terms, except as the same may be
limited by bankruptcy, insolvency, and other similar laws affecting the rights
of creditors generally and the availability of equitable remedies for the
enforcement of certain obligations (other than the payment of principal)
contained herein or therein and as may be limited by equitable principles
generally.
Section 11.19. Survival of Representations and Warranties. The Borrower
understands and agrees that the Agent and the Lenders are relying upon the above
representations and warranties in making the Revolving Loans to the Borrower.
The Borrower further agrees that the foregoing representations and warranties
shall be true and correct in all material respects as of the date(s) made or
deemed made and shall remain in full force and effect until such time as the
Indebtedness shall be paid in full, or until this Agreement shall be terminated,
whichever is the last to occur.
ARTICLE XII
AFFIRMATIVE COVENANTS
---------------------
The Borrower covenants and agrees as follows:
Section 12.1. Financial Statements; Other Reporting Requirements. The
Borrower will furnish or cause to be furnished to the Agent:
(a) as soon as available and in any event within eighty (80) days
following the close of fiscal year of the Borrower, audited
consolidated financial statements of the Borrower consisting of a
balance sheet as at the end of such fiscal year and statements of
income, and statement of cash flow for such fiscal year, setting forth
in each case in comparative form the corresponding figures for the
preceding fiscal year, certified by independent certified public
accountants of recognized national standing or otherwise acceptable to
the Required Lenders (such acceptance not to be unreasonably
withheld), whose certification shall be unqualified and in scope and
substance satisfactory to the Required Lenders;
33
(b) as soon as available and in any event within forty-five (45) days
following the close of each fiscal quarter of the Borrower, interim
unaudited consolidated financial statements of the Borrower,
consisting of a balance sheet as of the end of such quarter and
statements of income and cash flow, certified as true and correct by
the Borrower's chief financial officer as having been prepared in
accordance with GAAP consistently applied;
(c) upon each submission of the financial statements required by (a) and
(b) above, a compliance certificate signed by the chief financial
officer of the Borrower substantially in the form attached hereto as
Exhibit A (a "Compliance Certificate"), certifying that he has
reviewed this Agreement and to the best of his knowledge no Default or
Event of Default has occurred, or if such Default or Event of Default
has occurred, specifying the nature and extent thereof, that all
financial covenants in this Agreement have been met, and providing a
computation of all financial covenants contained herein; and
(d) such other financial information or other information concerning the
Borrower and/or any Guarantor as the Agent and/or the Lenders may
reasonably request from time to time.
(e) In addition, the Borrower may deliver information required to be
delivered pursuant to Sections 12.1 (a) and (b) by posting any such
information to the Borrower's internet website (as of the Agreement
date, xxx.xxxxxxxx.xxx). Any such information provided in such manner
shall only be deemed to have been delivered to the Agent or a Lender
(i) on the date on which the Agent or such Lender, as applicable,
receives notice from the Borrower that such information has been
posted to the Borrower's internet website and (ii) only if such
information is publicly available without charge on such website. If
for any reason, the Agent or a Lender either did not receive such
notice or after reasonable efforts was unable to access such website,
then the Agent or such Lender, as applicable, shall not be deemed to
have received such information. In addition to any manner permitted by
Section 12.1, the Borrower may notify the Agent or a Lender that
information has been posted to such a website by causing an e-mail
notification to be sent to an e-mail address specified from time to
time by the Agent or such Lender, as applicable.
(f) Notwithstanding anything in this Section to the contrary (i) the
Borrower shall deliver paper copies of information required pursuant
to Section 12.1(a) and (b) to the Agent or any Lender that requests
the Borrower to deliver such paper copies until a written request to
cease delivering paper copies is given to the Borrower by the Agent or
such Lender and (ii) in every instance the Borrower shall be required
to provide to the Agent a paper original of the Compliance Certificate
required by Section 12.1(c).
34
Section 12.2. Notice of Default; Litigation; ERISA Matters. The Borrower
will give written notice to the Agent as soon as reasonably possible and in no
event more than five (5) Business Days of (i) the occurrence of any Default or
Event of Default hereunder of which it has knowledge, (ii) the filing of any
actions, suits or proceedings against the Borrower in any court or before any
governmental authority or tribunal of which it has knowledge, which could
reasonably be expected to cause a Material Adverse Effect with respect to the
Borrower, (iii) the occurrence of a reportable event under, or the institution
of steps by the Borrower to withdraw from, or the institution of any steps to
terminate, any employee pension plan (other than a Multiemployer Plan) which is
covered by Title IV of ERISA or subject to the minimum funding standard under
Section 412 of the Internal Revenue Code as to which the Borrower may have
liability in excess of $100,000.00, or (iv) the occurrence of any other action,
event or condition of any nature of which it has knowledge which could
reasonably be expected to cause, or lead to, or result in, any Material Adverse
Effect to the Borrower.
Section 12.3. Maintenance of Existence, Properties and Liens. The Borrower
will (i) continue to engage in its existing business operations and other
business activities reasonably related to thereto; (ii) maintain its existence
and good standing in each jurisdiction where the failure to qualify would have a
Material Adverse Effect; (iii) keep and maintain all franchises, licenses and
properties necessary in the conduct of its business in good order and condition,
except to the extent the failure to do so could not reasonably be expected to
cause a Material Adverse Effect; and (iv) duly observe and conform to all
material requirements of any governmental authorities relative to the conduct of
its business or the operation of its properties or assets, except to the extent
the failure to do so could not reasonably be expected to cause a Material
Adverse Effect.
Section 12.4. Taxes. The Borrower shall pay or cause to be paid when due,
all taxes, local and special assessments, and governmental charges of every type
and description, that may from time to time be imposed, assessed and levied
against its properties. The Borrower further agrees to furnish the Agent with
evidence that such taxes, assessments, and governmental charges due by the
Borrower have been paid in full and in a timely manner, if such data is
requested by the Agent. Notwithstanding the foregoing, the Borrower may withhold
any such taxes, local and special assessments, and governmental charges or elect
to contest any lien if the Borrower is in good faith conducting an appropriate
proceeding to contest the obligation to pay.
Section 12.5. Compliance with Environmental Laws. The Borrower and each
Guarantor shall comply with and shall use reasonable commercial efforts to cause
all of its employees, or agents (while such Persons are acting within the scope
of their relationship with the Borrower) to (i) comply with all Environmental
Laws with respect to the disposal of Hazardous Materials, (ii) pay immediately
when due the cost of removal of any such Hazardous Materials, and (iii) keep the
Borrower's and each Guarantor's properties free of any lien imposed pursuant to
any Environmental Laws, provided that no breach of this Section 12.5 shall occur
if (a) the same is discharged within thirty (30) days after the Borrower or such
Guarantor is notified of non-compliance or an appeal or appropriate proceedings
for review thereof is taken within such period and Borrower or such Guarantor is
not obligated to comply pending such appeal or other appropriate proceedings or
(b) failure to do so could not reasonably be expected to have a Material Adverse
Effect.
35
The Borrower shall give notice to the Agent as soon as reasonably possible
and in no event more than five (5) days after Borrower (or any Guarantor)
receives any compliance orders, environmental citations, or other notices from
any Governmental Authority relating to any Environmental Liabilities relating to
its properties which may reasonably be expected to result in an Event of
Default; the Borrower agrees to take any and all reasonable steps, and to
perform any and all reasonable actions necessary or appropriate to promptly
comply with any such compliance orders, environmental citations, or other
notices from any Governmental Authority relating to any Environmental
Liabilities requiring the Borrower (or any Guarantor) to remove, treat or
dispose of such Hazardous Materials, and, upon Agent's request, to provide the
Agent with satisfactory evidence of such compliance with any claim in excess of
$500,000; provided, however, that nothing contained herein shall preclude the
Borrower from contesting any such compliance orders, environmental citations, or
other notices from any Governmental Authority relating to any Environmental
Liabilities if such contest is made in good faith, appropriate reserves are
established for the payment for the cost of compliance therewith.
Regardless of whether any Event of Default hereunder shall have occurred
and be continuing, the Borrower and each Guarantor agrees to defend, indemnify
and hold harmless the Agent and the Lenders from any and all liabilities
(including strict liability), actions, demands, penalties, losses, costs or
expenses (including, without limitation, reasonable attorneys fees and remedial
costs), suits, administrative orders, agency demand letters, costs of any
settlement or judgment and claims of any and every kind whatsoever which may now
or in the future (whether before or after the termination of this Agreement) be
paid, incurred, or suffered by, or asserted against the Agent and/or the Lenders
by any person or entity or governmental agency for, with respect to, or as a
direct or indirect result of, the presence on or under, or the escape, seepage,
leakage, spillage, discharge, emission, or release from or onto the property of
the Borrower (or any Guarantor) of any Hazardous Materials, regulated by any
Environmental Laws, contamination resulting therefrom, or arising out of, or
resulting from, the environmental condition of such property or the
applicability of any Environmental Laws relating to hazardous materials
(including, without limitation, CERCLA or any so called federal, state or local
"super fund" or "super lien" laws, statute, ordinance, code, rule, regulation,
order or decree) regardless of whether or not caused by or within the control of
the Lender (the costs and/or liabilities described above being hereinafter
referred to as the "Environmental Liabilities"); provided, however, that the
Borrower shall not be obligated to indemnify the Agent or any Lenders for any
acts or omissions of the Agent or any Lenders in connection with matters
described in this subsection to the extent arising from the gross negligence or
willful misconduct of such Agent or Lender, as determined by a court of
competent jurisdiction in a final, non-appealable judgment. THE COVENANTS AND
INDEMNITIES CONTAINED IN THIS SECTION 12.5 SHALL SURVIVE THE TERMINATION OF THIS
AGREEMENT; AND, PROVIDED, HOWEVER, NO RELEASE, WAIVER, DEFENSE OR INDEMNITY
SHALL BE AFFORDED UNDER THIS SECTION 12.5 IN RESPECT OF ANY PROPERTY FOR ANY
OCCURRENCE ARISING FROM THE ACTS OR OMISSIONS OF THE AGENT AND/OR THE LENDERS OR
THEIR AGENTS OR REPRESENTATIVES DURING THE PERIOD AFTER WHICH SUCH PERSON, ITS
SUCCESSORS OR ASSIGNS, OR ITS AGENTS OR REPRESENTATIVES, SHALL HAVE OBTAINED
OWNERSHIP, OPERATION OR POSSESSION OF SUCH PROPERTY (WHETHER BY FORECLOSURE OR
DEED IN LIEU OF FORECLOSURE, AS MORTGAGEE-IN-POSSESSION OR OTHERWISE). ANY
CLAIMS UNDER THIS SECTION 12.5 SHALL BE SUBJECT TO SECTION 15.9.
36
Section 12.6. Further Assurances. The Borrower will, at any time and from
time to time, execute and deliver such further instruments and take such further
action as may reasonably be requested by the Agent, in order to cure any defects
in the execution and delivery of, or to comply with or accomplish the covenants
and agreements contained in this Agreement or the Collateral Documents.
Section 12.7. Financial Covenants. The Borrower shall comply with the
following covenants and ratios:
(a) Minimum Fixed Charge Coverage. At the end of each fiscal quarter of
the Borrower, its fixed charge coverage ratio shall be not less than
1.50 to 1.00. The fixed charge coverage ratio shall be calculated as
follows: EBITDA plus Borrower's consolidated lease/rent expense minus
consolidated unfinanced capital expenditures divided by Borrower's
consolidated prior period current maturities of long-term debt plus
interest expense plus lease/rent expense plus cash taxes. This
covenant will be tested quarterly by Agent on a rolling four-quarters
basis, commencing June 30, 2008.
(b) Total Liabilities to Tangible Net Worth. At the end of each fiscal
quarter of the Borrower, its ratio of Total Liabilities to Tangible
Net Worth shall be not more than 2.50 to 1.00. This covenant will be
tested by Agent on a quarterly basis, commencing June 30, 2008.
(c) Leverage Ratio. At the end of each fiscal quarter of the Borrower, its
Leverage Ratio shall be not more than 2.50 to 1.00. This covenant will
be tested by Agent quarterly on a rolling four quarters basis
commencing June 30, 2008.
(d) Working Capital Ratio. At the end of each fiscal quarter of the
Borrower, its working capital ratio shall be not less than 1.50 to
1.00. This working capital ratio will be calculated as follows:
Consolidated Current Assets divided by Consolidated Current
Liabilities, all as determined in accordance with GAAP. This covenant
will be tested quarterly by Agent commencing June 30, 2008.
Section 12.8. Operations. The Borrower and each Guarantor shall conduct its
business affairs in a reasonable and prudent manner and in compliance with all
applicable federal, state and municipal laws, ordinances, rules and regulations
respecting its properties, charters, businesses and operations, including
compliance with all minimum funding standards and other requirements of ERISA of
1974, and other laws applicable to any employee benefit plans which they may
have, except to the extent the failure to do so could not reasonably be expected
to cause a Material Adverse Effect.
37
Section 12.9. Change of Location. The Borrower shall, within ten (10)
Business Days prior to any change to the location of its chief executive office,
notify the Agent in writing of such proposed change.
Section 12.10. Employee Benefit Plans. The Borrower will maintain each
employee pension benefit plan (other than a Multiemployer Plan) which is covered
by Title IV of ERISA or subject to the minimum funding standards under Section
412 of the Internal Revenue Code benefit plan as to which it may have any
liability, in material compliance with all applicable requirements of law and
regulations; except to the extent the failure to do so could not reasonably be
expected to cause a Material Adverse Effect.
Section 12.11. Deposit and Operating Accounts. The Borrower will maintain
its primary deposit and operating accounts with Capital One or such other Lender
(or any one or more of them) acceptable to the Borrower.
Section 12.12. Field Audits; Other Information. Upon reasonable prior
notice, the Borrower shall allow the Agent's employees and agents access to its
books and records and properties during normal business hours to perform field
audits on an annual basis. The Borrower shall pay all reasonable costs and
expenses associated with such field audits. The Borrower will provide the Agent
with such other information as the Agent may reasonably request from time to
time, subject in all cases to any confidentiality restrictions that may be
applicable to the Borrower and its Subsidiaries and to any confidentiality
restrictions that the Borrower reasonably imposes on the Persons receiving such
information.
Section 12.13. Insurance. The Borrower agrees to provide the Agent with
certificates or binders evidencing its insurance coverage on an annual basis,
and, if requested by the Agent, the Borrower further agrees to promptly furnish
the Agent with copies of all renewal notices and copies of receipts for paid
premiums. The Borrower shall provide the Agent with certificates or binders
evidencing insurance coverage pursuant to all renewal or replacement policies of
insurance no later than fifteen (15) days before any such existing policy or
policies should expire.
Section 12.14. Subsidiaries. The Borrower agrees that any Subsidiary of the
Borrower formed or acquired by or on behalf of the Borrower after the date of
this Agreement that is not an Excluded Subsidiary of the Borrower shall join the
Guaranty not later than the next succeeding date on which the Borrower delivers
its Compliance Certificate pursuant to Section 12.1(c) of this Agreement, and
Borrower shall deliver to the Agent on such date (i) notice of such Acquisition
or formation, as the case may be, and (ii) to the extent such acquired or formed
Subsidiary is not an Excluded Subsidiary, a duly executed joinder agreement to
the Guaranty, operating agreement (or similar document), certificate of
formation (or similar document), resolutions of the governing body of such
Subsidiary approving the guaranty and related transactions and good standing
certificate.
38
Section 12.15. Collateral Documents. The Borrower agrees to grant (and/or
cause its Subsidiaries to grant) to Agent for the Pro Rata benefit of the
Lenders perfected first priority security interests and mortgage liens on
properties and assets of Borrower and its Subsidiaries if an Event of Default
arising pursuant to Section 14.1(a) or the Borrower's noncompliance with Section
12.7 above and continues beyond the expiration of its applicable cure period.
Section 12.16. Post-Closing Requirements. The Borrower covenants and agrees
to comply timely with the following post-closing requirements:
(i) The Borrower shall deliver to Agent on or before July
12, 2008 (i) a Guaranty duly executed by each of Grant
Memorial HomeCare and Hospice, LLC and Southern
Regional HomeCare, LLC, together with true and correct
copies of the articles of organization and operating
agreements, as amended, for such entities and any
necessary consent by the members of such entities, or
(ii) a Security Agreement (or supplement thereto) duly
executed by the Subsidiary of Borrower having a
membership interest in Grant Memorial HomeCare and
Hospice, LLC and Southern Regional HomeCare, LLC,
together with true and correct copies of the articles
of organization and operating agreements, as amended,
for such entities and any necessary consent by the
members of such entities; and
(ii) The Borrower shall deliver to the Agent on or before
July 12, 2008 a Security Agreement (or supplement
thereto) duly executed by Alabama Health Care Group,
LLC and Louisiana Health Care Group, LLC affecting the
equity and membership interests of said entities in
Gulf HomeCare, Inc., Infirmary Home Health Agency,
Inc., and Xxxxxxxxxx Medical Center HomeCare, LLC,
together with true and correct copies of the
organizational, incorporation and other governing
documents, as amended, for such entities and any
necessary member/shareholder consents.
Section 12.17. Excluded Subsidiaries. The Borrower agrees to use
commercially reasonable efforts to obtain and deliver to the Agent an executed
joinder to the Guaranty by each non-wholly owned Subsidiary of Borrower;
provided, however, Borrower agrees, and understands that if any such joinder
cannot be executed and delivered, the Subsidiary of Borrower that owns an
interest in the Excluded Subsidiary must execute and deliver to the Agent a
joinder to the Pledge Agreement (and deliver in pledge to the Agent the
certificates evidencing such interests); provided, further, the parties agree
that (i) the following Excluded Subsidiaries are not required to execute the
Guaranty: Patient's Choice Hospice and Palliative Care of Louisiana, L.L.C.;
Baton Rouge HomeCare, L.L.C.; University of TN Medical Center Home Care
Services, L.L.C.; LHCG V, L.L.C. d/b/a Glenwood Home Health Agency; GSHS Home
Health, L.P.; Xxxxxxxx HomeCare, L.P.; and any subsidiaries of the foregoing
entities; and (ii) the Subsidiaries that have equity interests in those Excluded
Subsidiaries listed in the preceding clause (i) are not required to pledge such
interests pursuant to the Pledge Agreement.
39
ARTICLE XIII
NEGATIVE COVENANTS
------------------
The Borrower covenants and agrees as follows:
Section 13.1. Limitations on Fundamental Changes. Without the prior written
consent of the Agent, the Borrower shall not form any Subsidiary that does not
become a Guarantor (except for Excluded Subsidiaries), nor shall the Borrower
consummate any transaction of merger or consolidation unless the Borrower is the
surviving entity, or liquidate or dissolve itself (or suffer any liquidation or
dissolution).
Section 13.2. Disposition of Assets. Without first obtaining the prior
written consent of the Agent, the Borrower shall not, and shall not permit any
Guarantor to, Dispose of any of its respective property or assets except for the
following:
(a) Dispositions of property or assets in the ordinary course of business;
(b) Dispositions of obsolete, damaged, worn out or surplus property no
longer used or useful in the business of the Borrower or such
Guarantor;
(c) Dispositions resulting from any casualty or other insured damage to,
or any taking under power of eminent domain or by condemnation or
similar proceeding of, any asset of the Borrower or a Guaranty; and
(d) Dispositions of property or assets to the extent that the net cash
proceeds received by the Borrower or a Guarantor are used within 180
days of receipt of such net cash proceeds to acquire property or
assets to be used by the Borrower or such Guarantor in its business.
Section 13.3. Intentionally Omitted.
Section 13.4. Encumbrances; Negative Pledge. The Borrower and Guarantor
shall not directly or indirectly create, incur, assume or permit to exist any
Encumbrances on any of its property and/or assets now owned or hereafter
acquired, except for the following (hereinafter referred to as the "Permitted
Encumbrances"):
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(a) Encumbrances for taxes, assessments, or other governmental charges not
yet due or which are being contested in good faith by appropriate
action promptly initiated and diligently conducted, if such reserves
as shall be required by GAAP shall have been made therefor;
(b) Encumbrances of landlords, vendors, carriers, warehousemen, mechanics,
laborers, materialmen and other Encumbrances arising by law in the
ordinary course of business for sums either not yet due or being
contested in good faith by appropriate action promptly initiated and
diligently conducted, if such reserve as shall be required by GAAP
shall have been made therefor;
(c) Inchoate liens arising under ERISA to secure the contingent
liabilities, if any, permitted by this Agreement;
(d) Encumbrances in favor of the Agent and/or the Lenders to secure the
Indebtedness;
(e) Encumbrances existing on the date hereof and set forth in Schedule
13.4, provided that such Encumbrances shall secure only those
obligations which they secure on the date hereof;
(f) Pledges and deposits made in the ordinary course of business in
compliance with workmen's compensation, unemployment insurance and
other social security laws or regulations;
(g) Deposits to secure the performance of bids, trade contracts (other
than for Indebtedness), leases (other than capital lease obligations),
statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of
business;
(h) Zoning restrictions, easements, licenses, covenants, conditions,
rights-of-way, restrictions on use of real property and other similar
encumbrances incurred in the ordinary course of business and minor
irregularities of title that, in the aggregate, are not substantial in
amount and do not materially detract from the value of the property
subject thereto or interfere with the ordinary conduct of the business
of the Borrower or any of its Subsidiaries;
(i) Deposits, encumbrances or pledges to secure payments of workmen's
compensation and other payments, public liability, unemployment and
other insurance, old-age pensions or other social security
obligations, or the performance of bids, tenders, leases, contracts
(other than contracts for the payment of money), public or statutory
obligations, surety, stay or appeal bonds, or other similar
obligations arising in the ordinary course of business;
(j) Any Encumbrance securing Purchase Money Indebtedness, provided that,
(i) such security interest is incurred, and the Debt secured thereby
is created, within 180 days after the acquisition (or completion of
construction) of the property or assets subject thereto, (ii) the Debt
secured thereby does not include any other Debt that is not from the
same financing source, and (iii) such security interest do not apply
to any other property or assets of the Borrower or any Subsidiary
except any such property or assets which are the subject of any
Encumbrance securing Debt from such financing source;
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(k) Encumbrances arising out of judgments or awards in respect of which
the Borrower (or any Guarantor) shall in good faith be prosecuting an
appeal or proceedings for review and in respect of which it shall have
secured a subsisting stay of execution pending such appeal or
proceedings for review, provided the Borrower shall have set aside on
its books adequate reserves, in accordance with GAAP, with respect to
such judgment or award;
(l) Encumbrances securing Debt in favor of Capital One, provided that such
Encumbrances attach only to the 1999 Cessna Citation V Ultra aircraft
(the "Palmetto Plane") and the proceeds of such property; and
(m) Encumbrances on the property or assets of any Person existing at the
time such Person becomes a Subsidiary of the Borrower and not incurred
as a result of (or in connection with or in anticipation of) such
Person's becoming a Subsidiary of the Borrower, provided that such
Encumbrances do not extend to or cover any property or assets of the
Borrower or any of its Subsidiaries other than the property or assets
encumbered at the time such Person becomes a Subsidiary of the
Borrower, and provided, further, that (i) such Encumbrances do not
secure any Debt or other obligation not permitted under this
Agreement.
Section 13.5. Debts. The Borrower and the Guarantor, without the prior
written consent of the Required Lenders, shall not incur, create, assume or in
any manner become or be liable in respect of any Debt, except for:
(a) The Indebtedness;
(b) Debt existing as of the date of this Agreement as set forth in
Schedule 13.5;
(c) Indebtedness arising under any performance bond, or letter of credit
obtained for similar purposes, or any reimbursement obligations in
respect thereof, entered into in the ordinary course of business;
(d) Debt of the Borrower to any Subsidiary and Debt of any Subsidiary of
the Borrower to the Borrower or any other Subsidiary;
(e) Debt to Capital One for the financing of the Palmetto Airplane not to
exceed $5,050,000; and
(f) Subject to a maximum aggregate principal amount at any time
outstanding not in excess of $250,000.00, the following: (i) Purchase
Money Indebtedness; (ii) additional unsecured Debt; and (iii) Debt of
any Person that becomes a Subsidiary after the date hereof; provided,
that such Debt exists at the time such Person becomes a Subsidiary and
is not created in contemplation of or in connection with such Person
becoming a Subsidiary.
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Section 13.6. Investments, Loans and Revolving Loans. Without first
obtaining the prior written consent of the Agent (or the Required Lenders in the
case of the immediately following clause (h)), the Borrower shall not, and shall
not permit any Guarantor to, make or permit to remain outstanding any loans or
advances to, or make investments or acquire an equity interest in any Person,
except for the following:
(a) Permitted Investments;
(b) Investments in existence on the date hereof and set forth on Schedule
13.6;
(c) Investments in the Borrower or any other Subsidiary;
(d) loans or advances to employees in the ordinary course of business in
an aggregate amount to any single employee not in excess of $75,000
(or, if and to the extent such loans or advances shall be used by such
employee for relocation expenses, $100,000) and in an aggregate amount
for all employees of the Borrower and the Subsidiaries not in excess
of $500,000 at any one time outstanding;
(e) Trade credit and accounts arising in the ordinary course of business;
(f) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of
trade credit in the ordinary course of business, and Investments
received in satisfaction or partial satisfaction thereof from
financially troubled account debtors to the extent reasonably
necessary in order to prevent or limit loss;
(g) Investments made as a result of the receipt of non-cash consideration
from an asset sale not prohibited by this Agreement;
(h) Investments made in connection with any acquisition by the Borrower or
a Subsidiary of stock or other equity interests (other than directors'
qualifying shares) in, all or substantially all the assets of, or all
or substantially all the assets constituting a division or line of
business of, a Person; provided, however, if the aggregate
consideration for such Acquisition is $5,000,000 or more, (i) the
Borrower shall have given the Agent notice of such Acquisition at
least 10 Business Days prior to the consummation of such Acquisition,
and (ii) the Required Lenders shall have given their prior consent to
such Acquisition (which consent shall not be unreasonably withheld or
delayed);
(i) other Investments in an amount not to exceed $250,000.00 in the
aggregate at any time outstanding; and
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(j) Acquisitions for which the total consideration to be paid by Borrower
is less than $5,000,000.00.
Section 13.7. Intentionally Omitted.
Section 13.8. Transactions with Affiliates. Except as set forth on Schedule
13.8 attached hereto, the Borrower shall not sell or transfer any property or
assets to, or purchase or acquire any property or assets from, or otherwise
engage in any other transactions with, any of its affiliates unless such
transaction is on terms that are no less favorable to the Borrower or such
Subsidiary, as the case may be, than those that could be obtained at the time of
such transaction on an arm's-length basis from a Person who is not an affiliate.
ARTICLE XIV
EVENTS OF DEFAULT
-----------------
Section 14.1. Events of Default. The occurrence of any one or more of the
following shall constitute an Event of Default:
(a) Default under the Indebtedness. Should the Borrower default in the
payment of principal under the Indebtedness of the Borrower to the Lenders, or
should the Borrower default in the payment of interest under the Indebtedness of
the Borrower to the Lender within ten (10) days after any such interest payment
is due.
(b) Default under this Agreement. Should the Borrower or any Guarantor
violate or fail to comply fully with any of the terms and conditions of, or
default under, this Agreement, and such default not be cured within thirty (30)
days of the occurrence thereof (provided, however, that no cure period shall be
available for a default in the obligation to maintain insurance coverages
required hereby).
(c) Default Under Other Agreements. Should any event of default occur or
exist under any of the Loan Documents (excluding an Event of Default described
in (a) or (b) above) or should the Borrower and/or the Guarantor violate, or
fail to comply fully with, any terms and conditions of any of the Collateral
Documents or Loan Documents (excluding an Event of Default described in (a) or
(b) above), and such default not be cured within thirty (30) days of the
occurrence thereof.
(d) Default in Favor of Third Parties. Should the Borrower or the
Guarantor (i) fail to pay Debt having a principal amount in excess of
$250,000.00 the aggregate (other than the Indebtedness), or any interest or
premium thereon, when due (or, if permitted by the terms of the relevant
document, within any applicable grace period), whether such Debt shall become
due by scheduled maturity, by required prepayment, by acceleration, by demand or
otherwise; or (ii) fail to perform any term, covenant or condition on its part
to be performed under any agreement or instrument evidencing, securing or
relating to Debt (other than the Indebtedness) having a principal amount in
excess of $250,000.00 the aggregate, when required to be performed, and such
failure shall continue after the applicable grace period, if any, specified in
such agreement or instrument, if the effect of such failure is to accelerate, or
to permit the holder or holders of such Debt to accelerate, the maturity of such
Debt.
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(e) Insolvency. The following occurrences, in addition to the failure or
suspension of the Borrower, shall constitute an Event of Default hereunder:
(i) Filing by the Borrower and/or any Guarantor having assets of
$100,000.00 or more of a voluntary petition or any answer seeking
reorganization, arrangement, readjustment of its debts or for any
other relief under any applicable bankruptcy act or law, or under
any other insolvency act or law, now or hereafter existing, or
any action by the Borrower and/or such Guarantor consenting to,
approving of, or acquiescing in, any such petition or proceeding;
the application by the Borrower and/or such Guarantor for, or the
appointment by consent or acquiescence of, a receiver or trustee
of the Borrower and/or such Guarantor for all or a substantial
part of the property of the Borrower and/or such Guarantor; the
making by the Borrower and/or such Guarantor, of an assignment
for the benefit of creditors; the inability of the Borrower
and/or any Guarantor having assets of $100,000.00 or more or the
admission by the Borrower and/or such Guarantor in writing, of
its inability to pay its debts as they mature (the term
"acquiescence" means the failure to file a petition or motion in
opposition to such petition or proceeding or to vacate or
discharge any order, judgment or decree providing for such
appointment within sixty (60) days after the appointment of a
receiver or trustee); or
(ii) Filing of an involuntary petition against the Borrower and/or any
Guarantor having assets of $100,000.00 or more in bankruptcy or
seeking reorganization, arrangement, readjustment of its debts or
for any other relief under any applicable bankruptcy act or law,
or under any other insolvency act or law, now or hereafter
existing and such petition remains undismissed or unanswered for
a period of sixty (60) days from such filing; or the involuntary
appointment of a receiver or trustee of the Borrower and/or such
Guarantor for all or a substantial part of the property of the
Borrower and/or such Guarantor and such appointment remains
unvacated or unopposed for a period of sixty (60) days from such
appointment, execution or similar process against any substantial
part of the property of the Borrower and/or such Guarantor and
such warrant remains unbonded or undismissed for a period of
sixty (60) days from notice to the Borrower or such Guarantor of
its issuance.
(f) Dissolution Proceedings. Should proceedings for the dissolution or
appointment of a liquidator of the Borrower and/or any Guarantor having assets
of $100,000.00 or more be commenced.
(g) False Statements. Should any representation or warranty of the
Borrower made by the Borrower to the Agent and/or the Lenders in this Agreement
or any other Loan Document or in any certificate or statement furnished
thereunder prove to be incorrect or misleading in any material respect when made
or reaffirmed.
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Upon the occurrence of an Event of Default, the Line of Credit Loan
Commitment will, at the option of the Lenders, either terminate or be suspended
(including any obligation to make any further Revolving Loans and/or issue
Letters of Credit), and, at the Lenders' option, the Notes and all Indebtedness
of the Borrower will become immediately due and payable, all without notice of
any kind to the Borrower, except that in the case of type described in the
"Insolvency" subsection above, such acceleration shall be automatic and not
optional. For any other Event of Default, the Agent, upon request of the
Required Lenders, shall by notice to Borrower declare the principal of, and all
interest then accrued on, the Notes and any other liabilities hereunder to be
forthwith due and payable, whereupon the same shall forthwith become due and
payable without presentment, demand, protest, notice of intent to accelerate,
notice of acceleration or other notice of any kind, all of which Borrower and
each Guarantor hereby expressly waive, anything contained herein or in the Notes
to the contrary notwithstanding. Upon the occurrence of an Event of Default and
upon the request of the Required Lenders, the Agent shall exercise any and all
rights and remedies under the Loan Documents, or any of them, granted to Agent
hereunder or granted to Agent at law or in equity, including, without
limitation, foreclosure of the Collateral. Nothing contained in this Article 14
shall be construed to limit or amend in any way the Events of Default enumerated
in the Notes or any other Loan Document, or any other document executed in
connection with the transaction contemplated herein.
Upon the occurrence and during the continuance of any Event of Default, the
Lenders are hereby authorized at any time and from time to time, without notice
(other than such notice as provided below) to Borrower or Guarantor (any such
notice being expressly waived by Borrower and Guarantor), to set-off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by any of the Lenders
to or for the credit or the account of Borrower against any and all of the
indebtedness of Borrower under the Notes and the Loan Documents, including this
Agreement, irrespective of whether or not the Lenders shall have made any demand
under the Loan Documents, including this Agreement or the Notes and although
such indebtedness may be unmatured. Any amount set-off by the Lenders shall be
applied against the indebtedness owed the Lenders by Borrower pursuant to this
Agreement and the Notes. The Lenders agree promptly to notify Borrower after any
such setoff and application, provided that the failure to give such notice shall
not affect the validity of such set-off and application. The rights of the
Lenders under this Section are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Lenders may
have.
Section 14.2. Waivers. Except as otherwise provided for in this Agreement
and by applicable law, the Borrower and the Guarantor waive to the extent
permitted by applicable law (i) presentment, demand and protest and notice of
presentment, dishonor, notice of intent to accelerate, notice of acceleration,
protest, default, nonpayment, maturity, release, compromise, settlement,
extension or renewal of any or all commercial paper, accounts, contract rights,
documents, instruments, chattel paper and guaranties at any time held by the
Agent for the benefit of the Lenders on which the Borrower and the Guarantor may
in any way be liable and hereby ratify and confirm whatever the Agent and/or the
Lenders may do in this regard, (ii) all rights to notice and a hearing prior to
the Agent's taking possession or control of, or to the Agent's replevy,
attachment or levy upon, the Collateral or any bond or security which might be
required by any court prior to allowing the Agent to exercise any of its
remedies, and (iii) the benefit of all valuation, appraisal and exemption laws.
The Borrower and the Guarantor acknowledge that they have been advised by
counsel of their choice with respect to this Agreement, the other Collateral
Documents, and the transactions evidenced by this Agreement and other Collateral
Documents.
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ARTICLE XV
THE AGENT AND THE LENDERS
-------------------------
Section 15.1. Appointment and Authorization. Each Lender hereby appoints
Agent as its nominee and agent, in its name and on its behalf: (i) to act as
nominee for and on behalf of such Lender in and under all Loan Documents; (ii)
to arrange the means whereby the funds of Lenders are to be made available to
Borrower under the Loan Documents; (iii) to take such action as may be requested
by any Lender under the Loan Documents (when such Lender is entitled to make
such request under the Loan Documents); (iv) to receive all documents and items
to be furnished to Lenders under the Loan Documents; (v) to be the secured
party, mortgagee, beneficiary, and similar party in respect of, and to receive,
as the case may be, any collateral for the benefit of Lenders; (vi) to promptly
distribute to each Lender all material information, requests, documents and
items received from Borrower under the Loan Documents; (vii) to promptly
distribute to each Lender such Lender's Pro Rata Part of each payment or
prepayment (whether voluntary, as proceeds of insurance thereon, or otherwise)
in accordance with the terms of the Loan Documents and (viii) to deliver to the
appropriate Persons requests, demands, approvals and consents received from
Lenders. Each Lender hereby authorizes Agent to take all actions and to exercise
such powers under the Loan Documents as are specifically delegated to such Agent
by the terms hereof or thereof, together with all other powers reasonably
incidental thereto. With respect to its commitments hereunder and the Notes
issued to it, Agent and any successor Agent shall have the same rights under the
Loan Documents as any other Lender and may exercise the same as though it were
not the Agent; and the term "Lender" or "Lenders" shall, unless otherwise
expressly indicated, include Agent and any successor Agent in its capacity as a
Lender. Agent and any successor Agent and its affiliates may accept deposits
from, lend money to, act as trustee under indentures of and generally engage in
any kind of business with Borrower, and any Person which may do business with
Borrower, all as if Agent and any successor Agent were not Agent hereunder and
without any duty to account therefor to the Lenders except where the actions of
Borrower in connection therewith would constitute a Default or Event of Default
under this Agreement or any other Loan Document; provided that, if any payments
in respect of any property (or the proceeds thereof) now or hereafter in the
possession or control of Agent which may be or become security for the
obligations of Borrower arising under the Loan Documents by reason of the
general description of indebtedness secured or of property contained in any
other agreements, documents or instruments related to any such other business
shall be applied to reduction of the obligations of Borrower arising under the
Loan Documents, then each Lender shall be entitled to share in such application
according to its Pro Rata part thereof. Each Lender, upon request of any other
Lender, shall disclose to all other Lenders all indebtedness and liabilities,
direct and contingent, of Borrower to such Lender as of the time of such
request.
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Section 15.2. Intentionally Omitted.
Section 15.3. Consultation with Counsel. Lenders agree that Agent may
consult with legal counsel selected by Agent and shall not be liable for any
action taken or suffered in good faith by it in accordance with and in reliance
upon the advice of such counsel.
Section 15.4. Documents. Agent shall not be under a duty to examine or pass
upon the validity, effectiveness, enforceability, genuineness or value of any of
the Loan Documents or any other instrument or document furnished pursuant
thereto or in connection therewith, and Agent shall be entitled to assume that
the same are valid, effective, enforceable and genuine and what they purport to
be.
Section 15.5. Resignation or Removal of Agent. Subject to the appointment
and acceptance of a successor Agent as provided below, Agent may resign at any
time by giving written notice thereof to Lenders and Borrower, and Agent may be
removed at any time with or without cause by Lenders. If no successor Agent has
been so appointed by Lenders (and approved by Borrower) and has accepted such
appointment within 30 days after the retiring Agent's giving of notice of
resignation or removal of the retiring Agent, then the retiring Agent may, on
behalf of Lenders, appoint a successor Agent. Any successor Agent must be
approved by Borrower, which approval will not be unreasonably withheld. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the rights
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder from and after the date on which the
successor Agent accepts its appointment. After any retiring Agent's resignation
or removal hereunder as Agent, the provisions of this Article XV shall continue
in effect for its benefit in respect to any actions taken or omitted to be taken
by it while it was acting as Agent.
Section 15.6. Responsibility of Agent. It is expressly understood and
agreed that the obligations of Agent under the Loan Documents are only those
expressly set forth in the Loan Documents, or as may be imposed by applicable
law, and that Agent, as the case may be, shall be entitled to assume that no
Default or Event of Default has occurred and is continuing, unless Agent, as the
case may be, has actual knowledge of such fact or has received notice from a
Lender or Borrower that such Lender or Borrower consider that a Default or an
Event of Default has occurred and is continuing and specifying the nature
thereof. Neither Agent nor any of their directors, officers, attorneys or
employees shall be liable for any action taken or omitted to be taken by them
under or in connection with the Loan Documents, except for its or their own
gross negligence or willful misconduct. Agent shall incur no liability under or
in respect of any of the Loan Documents by acting upon any notice, consent,
certificate, warranty or other paper or instrument believed by it to be genuine
or authentic or to be signed by the proper party or parties, or with respect to
anything which it may do or refrain from doing in the reasonable exercise of its
judgment, or which may seem to it to be necessary or desirable.
Agent shall not be responsible to Lenders for any of Borrower's or any
Guarantor's recitals, statements, representations or warranties contained in any
of the Loan Documents, or in any certificate or other document referred to or
provided for in, or received by any Lender under, the Loan Documents, or for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of or
any of the Loan Documents or for any failure by Borrower or any Guarantor to
perform any of their obligations hereunder or thereunder. Agent may employ
agents and attorneys-in-fact and shall not be answerable, except as to money or
securities received by it or its authorized agents, for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care.
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The relationship between Agent and each Lender is only that of agent and
principal and has no fiduciary aspects. Nothing in the Loan Documents or
elsewhere shall be construed to impose on Agent any duties or responsibilities
other than those for which express provision is therein made. In performing its
duties and functions hereunder, Agent does not assume and shall not be deemed to
have assumed, and hereby expressly disclaims, any obligation or responsibility
toward or any relationship of agency or trust with or for Borrower or any of its
beneficiaries or other creditors. As to any matters not expressly provided for
by the Loan Documents, Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of all Lenders and such instructions shall be binding upon all
Lenders and all holders of the Notes; provided, however, that Agent shall not be
required to take any action which is contrary to the Loan Documents or
applicable law.
Agent shall have the right to exercise or refrain from exercising, without
notice or liability to the Lenders (except as otherwise provided for in this
Agreement or by applicable law), any and all rights afforded to Agent, as the
case may be, by the Loan Documents or which Agent may have as a matter of law;
provided, however, Agent shall not, without the consent of Lenders, take any
other action with regard to amending the Loan Documents, waiving any default
under the Loan Documents or taking any other action with respect to the Loan
Documents which requires consent of the Required Lenders. Provided further,
however, that no amendment, waiver, or other action shall be effected pursuant
to the preceding sentence without the consent of all Lenders which: (i) would
increase the Commitment amount of any Lender, (ii) would reduce any fees
hereunder, or the principal of, or the interest on, any Lender's Notes, (iii)
would postpone any date fixed for any payment of any fees hereunder, or any
principal or interest of any Lender's Notes, (iv) would increase any Lender's
obligations hereunder or would materially alter Agent's obligations to any
Lender hereunder, (v) would release Borrower from its obligation to pay any
Lender's Notes, (vi) would release the Guaranty and/or the Collateral (except as
provided in Section 13.2 hereof), or (vii) would amend this sentence. For
purposes of this paragraph, a Lender shall be deemed to have consented to any
such action by Agent upon the passage of five (5) Business Days after written
notice thereof is given to such Lender in accordance with Section 16.2. hereof,
unless such Lender shall have previously given Agent notice, complying with the
provision of Section 16.2 hereof, to the contrary. Agent shall not have
liability to Lenders for failure or delay in exercising any right or power
possessed by Agent pursuant to the Loan Documents or otherwise unless such
failure or delay is caused by the gross negligence of the Agent.
Section 15.7. Independent Investigation. Each Lender severally represents
and warrants to Agent that it has made its own independent investigation and
assessment of the financial condition and affairs of Borrower in connection with
the making and continuation of its participation hereunder and has not relied
exclusively on any information provided to such Lender by Agent in connection
herewith, and each Lender represents, warrants and undertakes to Agent that it
shall continue to make its own independent appraisal of the credit worthiness of
Borrower while the Notes are outstanding or its commitments hereunder are in
force. Agent shall not be required to keep itself informed as to the performance
or observance by Borrower of this Agreement or any other document referred to or
provided for herein or to inspect the properties or books of Borrower. Other
than as provided in this Agreement or any other Loan Document, Agent shall not
have any duty, responsibility or liability to provide any Lender with any credit
or other information concerning the affairs, financial condition or business of
Borrower which may come into the possession of Agent.
49
Section 15.8. Indemnification. Lenders agree to indemnify Agent, ratably
according to their respective Line of Credit Loan Commitment on a Pro Rata
basis, from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
proper and reasonable kind or nature whatsoever which may be imposed on,
incurred by or asserted against Agent in any way relating to or arising out of
the Loan Documents or any action taken or omitted by Agent under the Loan
Documents, provided that no Lender shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from Agent's gross negligence or
willful misconduct. Each Lender shall be entitled to be reimbursed by the Agent
for any amount such Lender paid to Agent under this Section 15.8. to the extent
the Agent has been reimbursed for such payments by Borrower or any other Person.
The parties intend for the provisions of this Section to apply to and protect
the Agent from the consequences of any liability including strict liability
imposed or threatened to be imposed on Agent as well as from the consequences of
its own negligence, whether or not that negligence is the sole, contributing or
concurring cause of any such liability excluding, however, gross negligence of
Agent.
Section 15.9. Benefit of Article XV. Except as provided in Section 15.5,
the agreements contained in this Article XV are solely for the benefit of Agent
and the Lenders and are not for the benefit of, or to be relied upon by,
Borrower, any affiliate of Borrower or any other person and shall not create any
third-party beneficiary rights in favor of any Person other than the Agent and
the Lenders.
Section 15.10. Pro Rata Treatment. Subject to the provisions of this
Agreement, each payment (including each prepayment) by Borrower or any Guarantor
and collection by Lenders (including offsets) on account of the principal of and
interest on the Notes and fees provided for in this Agreement, payable by
Borrower or any Guarantor shall be made Pro Rata; provided, however, in the
event that any Defaulting Bank shall have failed to make a Revolving Loan as
contemplated in this Agreement hereof and Agent or another Lender or Lenders
shall have made such Revolving Loan, payment received by Agent for the account
of such Defaulting Bank(s) shall not be distributed to such Defaulting Bank(s)
until such Revolving Loan(s) shall have been repaid in full to the Lender or
Lenders who funded such Revolving Loan(s).
Section 15.11. Intentionally Omitted.
Section 15.12. Other Financings. Without limiting the rights to which any
Lender otherwise is or may become entitled, such Lender shall have no interest,
by virtue of this Agreement or the Loan Documents, in (a) any present or future
loans from, letters of credit issued by, or leasing or other financial
transactions by, any other Lender to, on behalf of, or with Borrower or any
Guarantor (collectively referred to herein as "Other Financings") other than the
obligations hereunder; (b) any present or future guarantees by or for the
account of Borrower or any Guarantor which are not contemplated by the Loan
Documents; (c) any present or future property taken as security for any such
Other Financings to the extent not also security for the Loans; or (d) any
property now or hereafter in the possession or control of any other Lender which
may be or become security for the obligations of Borrower or any Guarantor
arising under any loan document by reason of the general description of
indebtedness secured or property contained in any other agreements, documents or
instruments relating to any such Other Financings to the extent not also
security for the Loans.
50
Section 15.13. Interests of the Lenders. Nothing in this Agreement shall be
construed to create a partnership or joint venture between Lenders for any
purpose. Agent, Lenders and Borrower recognize that the respective obligations
of Lenders under the Revolving Loan Commitments shall be several and not joint
and that neither Agent, nor any of Lenders shall be responsible or liable to
perform any of the obligations of the other Lenders under this Agreement. Each
Lender is deemed to be the owner of an undivided interest in and to all rights,
titles, benefits and interests belonging and accruing to Agent under the
Collateral Documents, including, without limitation, Liens and security
interests in any Collateral, fees and payments of principal and interest by
Borrower under the Revolving Loan Commitments on a Pro Rata basis. Each Lender
shall perform all duties and obligations of Lenders under this Agreement in the
same proportion as its ownership interest in the Loans outstanding at the date
of determination thereof.
Section 15.14. Investments. Whenever Agent in good faith determines that it
is uncertain about how to distribute to Lenders any funds which it has received,
or whenever Agent in good faith determines that there is any dispute among the
Lenders about how such funds should be distributed, Agent may choose to defer
distribution of the funds which are the subject of such uncertainty or dispute.
If Agent in good faith believes that the uncertainty or dispute will not be
promptly resolved, or if Agent is otherwise required to invest funds pending
distribution to the Lenders, Agent may invest such funds pending distribution
(at the risk of Borrower). All interest on any such investment shall be
distributed upon the distribution of such investment and in the same proportions
and to the same Persons as such investment. All monies received by Agent for
distribution to the Lenders (other than to the Person who is Agent in its
separate capacity as a Lender) shall be held by the Agent pending such
distribution solely as Agent for such Lenders, and Agent shall have no equitable
title to any portion thereof.
ARTICLE XVI
MISCELLANEOUS
-------------
Section 16.1. No Waiver; Modification in Writing. No failure or delay on
the part of the Agent and/or the Lenders in exercising any right, power or
remedy hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any such right, power or remedy preclude any other or
further exercise thereof or the exercise of any other right, power or remedy
hereunder. No amendment, modification or waiver of any provision of this
Agreement or of the Notes, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in writing
signed by or on behalf of the Agent and the Required Lenders (or all Lenders if
their consent is required by Section 15.6 hereof) and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given. No notice to or demand on the Borrower in any case
shall entitle the Borrower to any other or further notice or demand in similar
or other circumstances.
51
Section 16.2. Addresses for Notices. All notices and communications
provided for hereunder shall be in writing and, shall be mailed, by certified
mail, return receipt requested, or delivered as set forth below unless any
person named below shall notify the others in writing of another address, in
which case notices and communications shall be mailed, by certified mail, return
receipt requested, or delivered to such other address.
If to the Agent and the Lenders
c/o the Agent:
Capital One, National Association
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
If to the Lenders:
Capital One, National Association
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxx
First Tennessee Bank, N. A.
000 Xxxxxxx Xxx., 00xx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx
Branch Banking and Trust Company
Corporate Banking Division
000 Xxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx
If to the Borrower or any Guarantor:
LHC Group, Inc.
000 Xxxx Xxxxxxx Xxxx
Xxxxx X
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx XxxXxxxxx
52
With a copy of any notice of an Event of Default which is sent to Borrower
also being sent contemporaneously therewith to:
Xxxxxx & Bird, LLP
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxx X. November
Section 16.3. Fees and Expenses. The Borrower agrees to pay all reasonable
out of pocket fees, costs and expenses of the Agent actually incurred in
connection with the preparation, execution and delivery of this Agreement, and
all Related Documents to be executed in connection herewith and subsequent
modifications or amendments to any of the foregoing, including without
limitation, the reasonable fees and disbursements of counsel to the Agent, and
to pay all costs and expenses of the Agent and the Lenders actually incurred in
connection with the enforcement of this Agreement, the Notes or the other
Related Documents, including reasonable legal fees and disbursements arising in
connection therewith. The Borrower also agrees to pay, and to save the Agent and
the Lenders harmless from any delay in paying stamp and other similar taxes, if
any, which may be payable or determined to be payable in connection with the
execution and delivery of this Agreement, the Notes, the other Related
Documents, or any modification thereof.
Section 16.4. Right of Set-off. The Lenders shall have a right to set-off
the obligations of the Borrower hereunder against, all funds which the Borrower
may maintain on deposit with any Lender (with the exception of funds deposited
in the Borrower's accounts in trust for third parties or funds deposited in
pension accounts, IRA's, Xxxxx accounts and All Saver Certificates), and the
Lenders shall have a lien upon and a security interest in all property of the
Borrower in a Lender's possession or control which shall secure the Indebtedness
of the Borrower to the Lenders under this Agreement and the Notes.
Section 16.5. Waiver of Marshaling. The Borrower and the Guarantor shall
not at any time hereafter assert any right under any law pertaining to
marshaling (whether of assets or liens) and the Borrower and the Guarantor
expressly agree that the Agent may execute or foreclose upon the Collateral in
such order and manner as the Agent, in its sole discretion, deems appropriate.
Section 16.6. Governing Law. This Agreement and the Notes shall be deemed
to be contracts made under the laws of the State of Louisiana and for all
purposes shall be governed by and construed in accordance with the laws of said
State.
Section 16.7. Consent to Loan Participation. The Borrower and the Guarantor
agree and consent to any Lender's sale or transfer, whether now or later, of one
or more participation interests in the Indebtedness of the Borrower arising
pursuant to this Agreement to one or more purchasers, whether related or
unrelated to the Lender. Such Lender may provide, subject to the confidentiality
requirements of Section 16.15, to any one or more purchasers, or potential
purchasers, any information or knowledge such Lender may have about the
Borrower, the Guarantor or about any other matter relating to such Indebtedness;
provided that such purchaser or potential purchaser also agrees to keep such
information confidential. The Borrower and the Guarantor also agree that the
purchasers of any such participation interest will be considered as the absolute
owners of such interests in such Indebtedness. In addition, any sale of a
participation interest in the Indebtedness prior to the occurrence of an Event
of Default will require the Borrower's consent, which consent shall not be
unreasonably withheld.
53
Section 16.8. Intentionally Omitted.
Section 16.9. Permitted Assignments. Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time assign to one
or more banks or other entities ("Purchasers") all or any part of its rights and
obligations under the Loan Documents. Such assignment shall be substantially in
the form of Exhibit C or in such other form as may be agreed to by the parties
thereto. The consent of the Borrower (but not the Guarantor) and the Agent shall
be required prior to an assignment becoming effective with respect to a
Purchaser which is not a Lender or an affiliate thereof; provided, however, that
if an Event of Default has occurred and is continuing, the consent of the
Borrower and/or the Guarantor shall not be required. Such consent shall not be
unreasonably withheld or delayed. Each such assignment with respect to a
Purchaser which is not a Lender or an affiliate thereof shall (unless each of
the Borrower and the Agent otherwise consents) be in an amount not less than the
lesser of (i) $5,000,000.00 or (ii) the remaining amount of the assigning
Lender's Commitment (calculated as at the date of such assignment) or
outstanding Loans (if the applicable Commitment has been terminated). Upon (i)
delivery to the Agent of an assignment, together with any consents required by
this Section, and (ii) payment of a $3,500 fee to the Agent for processing such
assignment (unless such fee is waived by the Agent), such assignment shall
become effective on the effective date specified in such assignment. The
assignment shall contain a representation by the Purchaser to the effect that
none of the consideration used to make the purchase of the Commitment under the
applicable assignment agreement constitutes "plan assets" as defined under ERISA
and that the rights and interests of the Purchaser in and under the Loan
Documents will not be "plan assets" under ERISA. On and after the effective date
of such assignment, such Purchaser shall for all purposes be a Lender party to
this Agreement and any other Loan Document executed by or on behalf of the
Lenders and shall have all the rights and obligations of a Lender under the Loan
Documents, to the same extent as if it were an original party hereto, and no
further consent or action by the Borrower, the Lenders or the Agent shall be
required to release the transferor Lender with respect such assignment. Upon the
consummation of any assignment to a Purchaser pursuant to this Section, the
transferor Lender, the Agent and the Borrower shall, if the transferor Lender or
the Purchaser desires that its Loans be evidenced by Notes, make appropriate
arrangements so that new Notes or, as appropriate, replacement Notes are issued
to such transferor Lender and new Notes or, as appropriate, replacement Notes,
are issued to such Purchaser, in each case in principal amounts reflecting their
respective Commitments, as adjusted pursuant to such assignment.
Section 16.10. Indemnity. (a) Subject to the limitations set forth in
Section 12.5 as to matters addressed therein, the Borrower and the Guarantor
agree to indemnify and hold harmless the Agent and the Lenders and their
respective officers, employees, agents, attorneys and representatives
(singularly, an "Indemnified Party", and collectively, the "Indemnified
Parties") from and against any loss, cost, liability, damage or expense
(including the reasonable fees and out-of-pocket expenses of counsel to the
54
Agent and/or the Lenders, including all local counsel hired by such counsel)
("Claim") incurred by the Agent and/or the Lenders in investigating or preparing
for, defending against, or providing evidence, producing documents or taking any
other action in respect of any commenced or threatened litigation,
administrative proceeding or investigation under any federal securities law,
federal or state environmental law, or any other statute of any jurisdiction, or
any regulation, or at common law or otherwise, to the extent arising out of or
is based upon any acts, practices or omissions or alleged acts, practices or
omissions of Borrower and the Guarantor, or its or their agents or arises in
connection with the duties, obligations or performance of the Indemnified
Parties in negotiating, preparing, executing, accepting, keeping, completing,
countersigning, issuing, selling, delivering, releasing, assigning, handling,
certifying, processing or receiving or taking any other action with respect to
the Loan Documents and all documents, items and materials contemplated thereby
even if any of the foregoing arises out of an Indemnified Party's ordinary
negligence; provided, however, that the Borrower and the Guarantor shall not be
obligated to indemnify any Indemnified Party for (A) any acts or omissions of
such Indemnified Party in connection with matters described in this subsection
to the extent arising from the gross negligence or willful misconduct of such
Indemnified Party, as determined by a court of competent jurisdiction in a
final, non-appealable judgment or (B) Indemnified Costs to the extent arising
directly out of or resulting directly from claims of one or more Indemnified
Parties against another Indemnified Party. The indemnity set forth herein shall
be in addition to any other obligations or liabilities of Borrower and the
Guarantor to the Agent and/or the Lenders hereunder or at common law or
otherwise, and shall survive any termination of this Agreement, the expiration
of the Loans and the payment of all indebtedness of Borrower to the Lenders
hereunder and under the Notes. If any Claim is asserted against any Indemnified
Party, the Indemnified Party shall endeavor to notify Borrower and the Guarantor
of such Claim (but failure to do so shall not affect the indemnification herein
made except to the extent of the actual harm caused by such failure). The
Indemnified Party shall have the right to employ, at Borrower's expense, counsel
of the Indemnified Parties' choosing and to control the defense of the Claim.
The Borrower or Guarantor may at its/their own expense also participate in the
defense of any Claim. Each Indemnified Party may employ separate counsel in
connection with any Claim to the extent such Indemnified Party believes it
reasonably prudent to protect such Indemnified Party. The parties intend for the
provisions of this Section to apply to and protect each Indemnified Party from
the consequences of any liability including strict liability imposed or
threatened to be imposed on Indemnified Party as well as from the consequences
of its own negligence, whether or not that negligence is the sole, contributing,
or concurring cause of any Claim.
(b) No Indemnified Party may settle any claim to be indemnified without
the consent of the indemnitor, such consent not to be unreasonably withheld;
provided, that the indemnitor may not reasonably withhold consent to any
settlement that an Indemnified Party proposes, if the indemnitor does not have
the financial ability to pay all its obligations outstanding and asserted
against the indemnitor at that time, including, without limitation, the maximum
potential claims pending or to the knowledge of the indemnitee threatened
against the Indemnified Party to be indemnified pursuant to this Section 16.10.
Section 16.11. Maximum Interest Rate. Regardless of any provisions
contained in this Agreement or in any other documents and instruments referred
to herein, the Lenders shall never be deemed to have contracted for or be
55
entitled to receive, collect or apply as interest on the Notes any amount in
excess of the Maximum Rate, and in the event Lenders ever receives, collects or
applies as interest any such excess, of if an acceleration of the maturity of
the Notes or if any prepayment by Borrower results in Borrower having paid any
interest in excess of the Maximum Rate, such amount which would be excessive
interest shall be applied to the reduction of the unpaid principal balance of
the Notes for which such excess was received, collected or applied, and, if the
principal balance of the Notes are paid in full, any remaining excess shall
forthwith be paid to Borrower. All sums paid or agreed to be paid to the Lenders
for the use, forbearance or detention of the indebtedness evidenced by the Notes
and/or this Agreement shall, to the extent permitted by applicable law, be
amortized, prorated, allocated and spread throughout the full term of such
indebtedness until payment in full so that the rate or amount of interest on
account of such indebtedness does not exceed the Maximum Rate. In determining
whether or not the interest paid or payable under any specific contingency
exceeds the Maximum Rate of interest permitted by law, Borrower and the Lenders
shall, to the maximum extent permitted under applicable law, (i) characterize
any non-principal payment as an expense, fee or premium, rather than as
interest; and (ii) exclude voluntary prepayments and the effect thereof; and
(iii) compare the total amount of interest contracted for, charged or received
with the total amount of interest which could be contracted for, charged or
received throughout the entire contemplated term of the Notes at the Maximum
Rate.
Section 16.12. Waiver of Jury Trial; Submission to Jurisdiction. (a) THE
BORROWER, THE AGENT AND THE LENDERS HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO WHICH THE BORROWER, THE GUARANTOR, THE AGENT AND THE LENDERS MAY
BE PARTIES, ARISING OUT OF OR IN ANY WAY PERTAINING TO (i) THE NOTES, (ii) THIS
AGREEMENT, (iii) THE COLLATERAL DOCUMENTS OR (iv) THE COLLATERAL. IT IS AGREED
AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF TRIAL BY JURY OF ALL
CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS
AGAINST PARTIES WHO ARE NOT PARTIES TO THIS AGREEMENT. THIS WAIVER IS KNOWINGLY,
WILLINGLY AND VOLUNTARILY MADE BY THE BORROWER, THE AGENT AND THE LENDERS, AND
THE BORROWER, THE AGENT, AND THE LENDERS HEREBY REPRESENT THAT NO
REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO INDUCE
THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. THE
BORROWER, THE AGENT AND THE LENDERS EACH FURTHER REPRESENT THAT IT HAS BEEN
REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER BY
INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD
THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.
(b) THE BORROWER HEREBY IRREVOCABLY CONSENTS TO THE JURISDICTION OF THE
STATE COURTS OF LOUISIANA AND THE FEDERAL COURTS IN LOUISIANA AND AGREES THAT
ANY ACTION OR PROCEEDING ARISING OUT OF OR BROUGHT TO ENFORCE THE PROVISIONS OF
THE REVOLVING NOTES, THIS AGREEMENT AND/OR THE COLLATERAL DOCUMENTS MAY BE
BROUGHT IN ANY COURT HAVING SUBJECT MATTER JURISDICTION.
56
Section 16.13. Severability. If a court of competent jurisdiction finds any
provision of this Agreement to be invalid or unenforceable as to any person or
circumstance, such finding shall not render that provision invalid or
unenforceable as to any other persons or circumstances. If feasible, any such
offending provision shall be deemed to be modified to be within the limits of
enforceability or validity; however, if the offending provision cannot be so
modified, it shall be stricken and all other provisions of this Agreement in all
other respects shall remain valid and enforceable.
Section 16.14. Headings. Article and Section headings used in this
Agreement are for convenience only and shall not affect the construction of this
Agreement.
Section 16.15. Confidentiality. For the purposes of this Section 16.15,
"Confidential Information" means information delivered to Agent and/or Lenders
by or on behalf of the Borrower or any Subsidiary in connection with the
transactions contemplated by or otherwise pursuant to this Agreement (including,
without limitation, any information regarding the transactions contemplated
hereby provided prior to the date of this Agreement), provided that such term
does not include information that (a) was publicly known, (b) subsequently
becomes publicly known through no act or omission by Agent and/or Lenders or any
Person acting on its behalf, or (c) otherwise becomes known to Agent and the
Lenders other than through disclosure by the Borrower or any Subsidiary. Agent
and the Lenders will maintain the confidentiality of such Confidential
Information in accordance with their standard procedures to protect confidential
information of third parties delivered to Agent and/or Lenders, provided that
Lender may deliver or disclose Confidential Information to (i) its directors,
officers, employees, agents, attorneys and affiliates, (ii) its affiliates,
financial advisors and other professional advisors who are made aware of the
confidential nature of such information and agreed to keep such information
confidential, (iii) any other holder of the Notes, (iv) any Person to which any
Lender sells or offers to sell the Notes or any part thereof or any
participation therein (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this Section
16.15), (v) any federal or state regulatory authority having jurisdiction over
such Lender, (vi) the National Association of Insurance Commissioners or any
similar organization, or any nationally recognized rating agency that requires
access to information about its investment portfolio, or (vii) any other Person
to which such delivery or disclosure may be necessary (w) to effect compliance
with any law, rule, regulation or order applicable to any Lender, (x) in
response to any subpoena or other legal process, (y) in connection with any
litigation to which such Lender is a party or an Event of Default has occurred
and is continuing, to the extent such Lender may reasonably determine such
delivery and disclosure to be necessary or appropriate in the enforcement or the
protection of the rights and remedies under this Agreement and the other Loan
Documents. Each holder of the Notes or an interest therein, by its acceptance of
the Notes or an interest therein, will be deemed to have agreed to be bound by
and to be entitled to the benefits of this Section 16.15 as though it were a
party to this Agreement.
Section 16.16 Prior Revolving Notes. Capital One and First Tennessee Bank,
N.A. agree to deliver to Borrower the Revolving Notes executed by Borrower
pursuant to the Original Agreement, marked "Cancelled by Renewal", within a
reasonable time following the execution of this Agreement.
57
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
Borrower:
LHC GROUP, INC.
a Delaware corporation
By:
------------------------------------
Name: Xxxx X. Xxxxxx
Title: President
Agent:
CAPITAL ONE, NATIONAL ASSOCIATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
Lenders:
CAPITAL ONE, NATIONAL ASSOCIATION
Line of Credit By:
------------------------------------
Loan Commitment: $30,000,000.00 Name:
------------- ----------------------------------
Percentage: 40.0 % Title:
---- ---------------------------------
FIRST TENNESSEE BANK, N.A.
Line of Credit By:
------------------------------------
Loan Commitment: $20,000,000.00 Name:
------------- ----------------------------------
Percentage: 26.666% Title:
------ ---------------------------------
BRANCH BANKING AND TRUST COMPANY,
a national banking association
Line of Credit By:
------------------------------------
Loan Commitment: $25,000,000.00 Name:
------------- ----------------------------------
Percentage: 33.333% Title:
------ ---------------------------------
58
Exhibit "A"
COMPLIANCE CERTIFICATE
----------------------
-----------------------------
Date
Capital One, National Association, as Agent
P. O. Xxx 0000
Xxxxxxxxx, XX 00000
Attn: Xx. Xxxxx Xxxxxxxxx
Dear Xx. Xxxxxxxxx:
This Compliance Certificate is submitted pursuant to the requirements
of that certain Amended and Restated Credit Agreement (the "Credit Agreement")
dated as of June 12, 2008, by and among LHC Group, Inc. (the "Borrower"),
Capital One, National Association, as Agent, and the Lenders.
Under the appropriate paragraphs of the Credit Agreement, we certify
that, to the best of our knowledge and belief, no condition, event, or act
which, with or without notice or lapse of time or both, would constitute an
Event of Default under the terms of the Credit Agreement, has occurred during
the 3 month period ending ______________________ (the "Reporting Period"). Also,
to the best of our knowledge, the Borrower and each Guarantor have complied with
all provisions of the Credit Agreement.
Additionally, the Borrower submits the following financial information
for the Reporting Period in accordance with the financial covenants and ratios
contained in the Credit Agreement.
I. MINIMUM FIXED CHARGE COVERAGE (Tested Quarterly on rolling 4 quarters
---------------------------------------------------------------------
basis)
------
(a) Borrower's EBITDA..................................$
--------------
(b) Borrower's consolidated lease/rent expense.........$
--------------
(c) Borrower's consolidated unfinanced capex...........$
--------------
(d) Sum of (a) + (b) - (c) ............................$
--------------
(e) Sum of consolidated prior period current maturities
of long term debt..................................$
--------------
(f) Interest Expense...................................$
--------------
(g) Lease/rent expense.................................$
--------------
(h) Cash taxes.........................................$
--------------
(i) Sum of (e) + (f) + (g) + (h).......................$
--------------
Ratio (d to i).......................................... ______ to 1.00
Minimum Fixed Charge Coverage........................... 1.50 to 1.00
1
II. TOTAL LIABILITIES TO TANGIBLE NET WORTH (Tested Quarterly)
----------------------------------------------------------
(a) Borrower's Consolidated Total Liabilities
(include minority interest)........................$
--------------
(b) Borrower's Consolidated Tangible Net Worth.........$
--------------
Ratio (a to b).......................................... ______ to 1.00
Maximum Ratio Permitted................................. 2.50 to 1.00
III. LEVERAGE RATIO
--------------
(Tested Quarterly on a rolling four quarters basis)
---------------------------------------------------
(a) Borrower's EBITDA .................................$
--------------
(b) Sum of senior funded Debt of Borrower and Subsidiaries to
Lenders (or any of them) plus interest expense.....$
--------------
Ratio (a to b).......................................... ______ to 1.00
Maximum Senior Funded Debt to EBITDA permitted.......... 2.50 to 1.00
IV. WORKING CAPITAL RATIO
---------------------
(a) Borrower's Consolidated Current Assets.............$
--------------
(b) Borrower's Consolidated Current Liabilities (including
outstanding balance under Line of Credit)..........$
--------------
Ratio (a / b) .......................................... ______ to 1.00
Minimum Working Capital Ratio Required.................. 1.50 to 1.00
V. Acquisitions
(a) Borrower or a Guarantor have entered into the following
Acquisitions:
-----------------------------------------------------------------------
-----------------------------------------------------------------------
(b) Attached hereto as Exhibit A are original copies of the Joinder
Agreement to the Guaranty executed by such new Subsidiaries acquired
pursuant to the Acquisitions set forth in V(a) above.
2
(c) Attached hereto as Exhibit B are the Operating Agreement (or
similar document), Certificate of Formation (or similar document),
Resolutions and Good Standing Certificate for each new Guarantor.
Sincerely,
LHC GROUP, INC.
By:
----------------------------
Name:
-----------------------
Title:
----------------------
3
EXHIBIT "B"
REQUEST FOR REVOLVING LOAN
TO: Capital One, National Association, as Agent
ATTN: Xx. Xxxxx Xxxxxxxxx
RE: Amended and Restated Credit Agreement dated as of
June 12, 2008 among LHC Group, Inc., Capital One,
National Association, as Agent, and the Lenders
signatory party thereto (the "Credit Agreement")
Pursuant to the Credit Agreement, LHC Group, Inc. (the "Borrower")
hereby requests a Revolving Loan on the Commitment. Said Revolving Loan shall be
in the amount of $__________________. The borrowing date is ______________. The
Revolving Loan shall be (i) a Base Rate Loan ____ or a Eurodollar Loan _____.
The Borrower certifies that as of the date hereof: (a) the Borrower and
the Guarantor are in compliance with all conditions and requirements of the
Credit Agreement; and (b) no condition, event, or act exists which, with or
without notice or lapse of time or both, would constitute an Event of Default
under the Credit Agreement.
LHC GROUP, INC.,
a Delaware corporation
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
1
EXHIBIT C
FORM OF REVOLVING NOTE
$__________________ _____________, 2008
FOR VALUE RECEIVED, LHC GROUP, INC., a Delaware corporation
(hereinafter referred to as the "Borrower"), hereby unconditionally promises to
pay to the order of ________________________ (the "Lender") at the offices of
CAPITAL ONE, NATIONAL ASSOCIATION, as Agent for the Lenders (the "Agent"), the
principal sum of _______________ AND NO/100 DOLLARS ($___________), or such
other or lesser amounts as may be reflected from time to time on the books and
records of Lender as evidencing the aggregate unpaid principal balance of
Revolving Loans made to Borrower on a revolving line of credit basis as provided
in the Credit Agreement (as hereinafter defined), in lawful money of the United
States of America together with interest from the date funds are made available
to the Borrower hereunder until paid at the rates specified in the Credit
Agreement. All payments of principal and interest due hereunder are payable at
the office of Agent at 000 Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxx 00000, or
at such other address as Agent shall designate in writing to Borrower.
The principal and all accrued interest on this Note shall be due and
payable in accordance with the terms and provisions of the Credit Agreement.
This Note is executed pursuant to that certain Amended and Restated
Credit Agreement dated of even date herewith among Borrower, the Agent, and
Lenders (the "Credit Agreement"), and is referred to in the Credit Agreement as
a Revolving Note. Reference is made to the Credit Agreement and the Loan
Documents for a statement of prepayment, rights and obligations of Borrower, for
a statement of the terms and conditions under which the due date of this Note
may be accelerated and for statements regarding other matters affecting this
Note (including without limitation the obligations of the holder hereof to
advance funds hereunder, principal and interest payment due dates, voluntary and
mandatory prepayments, exercise of rights and remedies, payment of attorneys'
fees, court costs and other costs of collection and certain waivers by Borrower
and others now or hereafter obligated for payment of any sums due hereunder).
Upon the occurrence of an Event of Default, the Agent and the Lender shall have
all rights and remedies as provided under the Credit Agreement and Loan
Documents. This Note may be prepaid in accordance with the terms and provisions
of the Credit Agreement. Reference is made to the Credit Agreement for
provisions concerning the applicable procedures for Revolving Loans under this
Note. Notwithstanding anything herein contained to the contrary, the maximum
aggregate amount of all Revolving Loans at any time outstanding under this Note
(and Lender's obligation to advance hereunder) shall not exceed
$_______________, all as provided in the Credit Agreement. Unless otherwise
defined herein, each capitalized term used herein shall have the same meaning
set forth in the Credit Agreement.
Upon the occurrence and continuation of an Event of Default, Lender has
the right prospectively (immediately following any applicable cure period) to
adjust and fix the simple interest rate under this Note until this Note is paid
in full, as follows: the fixed default interest rate shall be equal to three
(3%) percent per annum in excess of the applicable interest rate pursuant to
Article IV of the Credit Agreement (including, without limitation, the
applicable Base Rate Margin or Eurodollar Margin) in effect at the time of the
Event of Default. Notwithstanding the foregoing, the holder hereof shall never
be entitled to receive, collect or apply, as interest on this Note, any amount
in excess of the Maximum Rate.
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If any payment of principal or interest on this Note shall become due
on a day other than a Business Day or a Eurodollar Business Day, as applicable,
such payment shall be made on the next succeeding Business Day or Eurodollar
Business Day, as applicable, and such extension of time shall in such case be
included in computing interest in connection with such payment.
If this Note is placed in the hands of an attorney for collection, or
if it is collected through any legal proceeding at law or in equity or in
bankruptcy, receivership or other court proceedings, Borrower agree to pay all
reasonable costs of collection actually incurred, including, but not limited to,
court costs and reasonable attorneys' fees.
Borrower waives presentment and demand for payment, notice of intention
to accelerate the maturity, protest, notice of protest and nonpayment, as to
this Note and as to each and all installments hereof.
Borrower represents and warrants to Lender that loans evidenced by this
Note were entered into primarily for commercial or business purposes as provided
in La. R. S. 9:3509.
The Lender shall have a right to set-off the obligations of the
Borrower under this Note against all funds which the Borrower may maintain on
deposit with the Lender (with the exception of funds deposited in the Borrower's
accounts in trust for third parties or funds deposited in pension accounts,
IRA's, Xxxxx accounts and All Saver Certificates), and the Lenders shall have a
lien upon and a security interest in all property of the Borrower in the
Lender's possession or control which shall secure the Indebtedness of the
Borrower to the Lenders under the Credit Agreement and this Note.
This Note shall be governed by and construed in accordance with the
applicable laws of the State of Louisiana.
(THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)
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THIS NOTE, THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS SET FORTH
THE ENTIRE AGREEMENT OF THE PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF
AND SUPERSEDE ALL PRIOR WRITTEN AND ORAL UNDERSTANDINGS BETWEEN THE BORROWER AND
THE LENDER AND ANY OTHER PARTIES WITH RESPECT TO THE MATTERS HEREIN SET FORTH.
EXECUTED as of the date and year first above written.
LHC GROUP, INC.
a Delaware corporation
By:
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Name:
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Title:
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