EXHIBIT 10.1
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CREDIT AGREEMENT
DATED AS OF JUNE 6, 2001
AMONG
MEDITRUST CORPORATION
AND
MEDITRUST OPERATING COMPANY,
AS BORROWERS,
THE LENDERS LISTED HEREIN,
AS LENDERS,
CANADIAN IMPERIAL BANK OF COMMERCE,
AS ADMINISTRATIVE AGENT,
FLEET SECURITIES INC.,
AS SYNDICATION AGENT,
CIBC WORLD MARKETS CORP.
AND FLEET SECURITIES INC.,
AS CO-LEAD ARRANGERS
AND
THE CHASE MANHATTAN BANK
AND LEHMAN COMMERCIAL PAPER INC.
AS CO-DOCUMENTATION AGENTS
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Section 1. DEFINITIONS....................................................................... 2
1.1 Certain Defined Terms............................................................. 2
1.2 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement........................................................................ 29
1.3 Other Definitional Provisions and Rules of Construction.......................... 29
Section 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS....................................... 30
2.1 Commitments; Making of Loans; Optional Notes..................................... 30
2.2 Interest on the Loans............................................................ 36
2.3 Fees............................................................................. 40
2.4 Repayments and Prepayments; General Provisions Regarding Payments; Application
of Proceeds of Collateral and Payments Under Subsidiary Guaranty................. 40
2.5 Use of Proceeds.................................................................. 47
2.6 Special Provisions Governing LIBOR Loans......................................... 47
2.7 Increased Costs; Taxes; Capital Adequacy......................................... 49
2.8 Obligation of Lenders and Issuing Lenders to Mitigate............................ 54
2.9 Extension of Term Loan and Revolving Loan Commitment Termination Dates........... 54
2.10 Borrowers........................................................................ 56
2.11 Joint and Several Liability...................................................... 57
2.12 Obligations Absolute............................................................. 57
2.13 Waiver of Suretyship Defenses.................................................... 58
2.14 Contribution and Indemnification among the Borrowers............................. 58
2.15 Replacement of a Lender.......................................................... 58
Section 3. LETTERS OF CREDIT................................................................ 59
3.1 Issuance of Letters of Credit and Lenders' Purchase of Participations Therein.... 59
3.2 Letter of Credit Fees............................................................ 61
3.3 Drawings and Reimbursement of Amounts Paid Under Letters of Credit............... 62
3.4 Obligations Absolute............................................................. 65
3.5 Indemnification; Nature of Issuing Lenders' Duties............................... 66
3.6 Increased Costs and Taxes Relating to Letters of Credit.......................... 67
Section 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT........................................ 68
4.1 Conditions to Term Loan and Initial Revolving Loans.............................. 68
4.2 Conditions to All Loans.......................................................... 72
4.3 Conditions to Letters of Credit.................................................. 73
Section 5. BORROWERS' REPRESENTATIONS AND WARRANTIES........................................ 74
5.1 Organization, Powers, Qualification, Good Standing, Business and Subsidiaries.... 74
5.2 Authorization of Borrowing, etc.................................................. 75
5.3 Financial Condition.............................................................. 76
5.4 No Material Adverse Change; No Restricted Payments............................... 76
5.5 Title to Properties; Liens; Real Property........................................ 76
5.6 Litigation; Adverse Facts........................................................ 77
5.7 Payment of Taxes................................................................. 78
5.8 Performance of Agreements; Materially Adverse Agreements; Material Contracts..... 78
5.9 Governmental Regulation.......................................................... 78
5.10 Securities Activities............................................................ 79
5.11 Employee Benefit Plans........................................................... 79
5.12 No Broker's Fees................................................................. 80
5.13 Environmental Protection......................................................... 80
5.14 Employee Matters................................................................. 80
5.15 Solvency......................................................................... 81
5.16 Matters Relating to Collateral................................................... 81
5.17 Disclosure....................................................................... 82
5.18 REIT Status...................................................................... 82
5.19 Insurance........................................................................ 82
Section 6. BORROWERS' AFFIRMATIVE COVENANTS................................................. 82
6.1 Financial Statements and Other Reports........................................... 83
6.2 Corporate Existence, etc......................................................... 86
6.3 Payment of Taxes and Claims; Tax Consolidation................................... 87
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CREDIT AGREEMENT
6.4 Maintenance of Properties; Insurance............................................. 87
6.5 Inspection Rights Lender Meeting................................................. 88
6.6 Compliance with Laws, etc........................................................ 88
6.7 Environmental Review and Investigation, Disclosure, Etc.; Borrower's Actions
Regarding Hazardous Materials Activities, Environmental Claims and Violations
of Environmental Laws............................................................ 88
6.8 Execution of Subsidiary Guaranty and Personal Property Collateral Documents by
Certain Subsidiaries and Future Subsidiaries..................................... 90
Section 7. BORROWERS' NEGATIVE COVENANTS.................................................... 90
7.1 Indebtedness..................................................................... 91
7.2 Liens and Related Matters........................................................ 92
7.3 Investments; Joint Ventures...................................................... 94
7.4 Contingent Obligations........................................................... 95
7.5 Restricted Payments.............................................................. 96
7.6 Financial Covenants.............................................................. 97
7.7 Restriction on Fundamental Changes; Asset Sales and Acquisitions................ 100
7.8 Capital Expenditures............................................................ 101
7.9 Disposal of Subsidiary Stock.................................................... 101
7.10 Conduct of Business............................................................. 102
7.11 Amendments or Waivers of Related Agreements..................................... 102
7.12 Fiscal Year..................................................................... 102
7.13 Public Company.................................................................. 102
7.14 Transactions with Affiliates.................................................... 102
Section 8. EVENTS OF DEFAULT............................................................... 103
8.1 Failure to Make Payments When Due............................................... 103
8.2 Default in Other Agreements..................................................... 103
8.3 Breach of Certain Covenants..................................................... 103
8.4 Breach of Warranty.............................................................. 104
8.5 Other Defaults Under Loan Documents............................................. 104
8.6 Involuntary Bankruptcy; Appointment of Receiver, etc............................ 104
8.7 Voluntary Bankruptcy; Appointment of Receiver, etc.............................. 104
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CREDIT AGREEMENT
8.8 Judgments and Attachments....................................................... 105
8.9 Dissolution..................................................................... 105
8.10 Employee Benefit Plans.......................................................... 105
8.11 Change in Control............................................................... 105
8.12 Invalidity of Subsidiary Guaranty; Failure of Security; Repudiation of
Obligations..................................................................... 105
8.13 Material Adverse Effect......................................................... 106
Section 9. ADMINISTRATIVE AGENT............................................................ 106
9.1 Appointment..................................................................... 106
9.2 Powers and Duties; General Immunity............................................. 108
9.3 Representations and Warranties; No Responsibility For Appraisal of
Creditworthiness................................................................ 109
9.4 Right to Indemnity.............................................................. 109
9.5 Successor Administrative Agent.................................................. 110
9.6 Collateral Documents and Subsidiary Guaranty.................................... 110
Section 10. MISCELLANEOUS................................................................... 111
10.1 Assignments and Participations in Loans......................................... 111
10.2 Expenses........................................................................ 115
10.3 Indemnity....................................................................... 115
10.4 Set-Off......................................................................... 116
10.5 Ratable Sharing................................................................. 117
10.6 Amendments and Waivers.......................................................... 117
10.7 Independence of Covenants....................................................... 119
10.8 Notices......................................................................... 119
10.9 Survival of Representations, Warranties and Agreements.......................... 120
10.10 Failure or Indulgence Not Waiver; Remedies Cumulative........................... 120
10.11 Marshalling; Payments Set Aside................................................. 120
10.12 Severability.................................................................... 121
10.13 Obligations Several; Independent Nature of Lenders' Rights...................... 121
10.14 Headings........................................................................ 121
10.15 Applicable Law.................................................................. 121
10.16 Successors and Assigns.......................................................... 121
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CREDIT AGREEMENT
10.17 Consent to Jurisdiction and Service of Process.................................. 122
10.18 Waiver of Jury Trial............................................................ 122
10.19 Confidentiality................................................................. 123
10.20 Co-Lead Arrangers, Co-Documentation Agents and Syndication Agent................ 124
10.21 Counterparts; Effectiveness..................................................... 124
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CREDIT AGREEMENT
EXHIBITS
I FORM OF NOTICE OF BORROWING
II FORM OF NOTICE OF CONVERSION/CONTINUATION
III FORM OF NOTICE OF ISSUANCE OF LETTER OF CREDIT
IV FORM OF TERM LOAN NOTE
V FORM OF REVOLVING NOTE
VI FORM OF COMPLIANCE CERTIFICATE
VII FORM OF OPINION OF COUNSEL TO LOAN PARTIES
VIII FORM OF OPINION OF ADMINISTRATIVE AGENT'S COUNSEL
IX FORM OF ASSIGNMENT AGREEMENT
X FORM OF BORROWERS' FINANCIAL CONDITION CERTIFICATE
XI FORM OF PLEDGE AND SECURITY AGREEMENT
XII FORM OF SUBSIDIARY GUARANTY
XIII FORM OF JOINDER INSTRUMENT
SCHEDULES
4.1C CORPORATE AND CAPITAL STRUCTURE; OWNERSHIP; MANAGEMENT
5.1 SUBSIDIARIES OF BORROWERS
5.5B REAL PROPERTY
5.6 LITIGATION
5.8C CERTAIN MATERIAL CONTRACTS
5.11 CERTAIN EMPLOYEE BENEFIT PLANS
5.13 ENVIRONMENTAL MATTERS
7.1 EXISTING INDEBTEDNESS
7.2 CERTAIN EXISTING LIENS
7.3 CERTAIN EXISTING INVESTMENTS
7.4 CERTAIN EXISTING CONTINGENT OBLIGATIONS
7.5 EXISTING PREFERRED STOCK
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CREDIT AGREEMENT
MEDITRUST CORPORATION
MEDITRUST OPERATING COMPANY
CREDIT AGREEMENT
This CREDIT AGREEMENT (this "AGREEMENT") is dated as of June 6, 2001
and entered into by and among MEDITRUST CORPORATION, a Delaware corporation
("MEDITRUST"), and MEDITRUST OPERATING COMPANY, a Delaware corporation
("MEDITRUST OPCO"; together with Meditrust jointly and severally, the
"BORROWERS"), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE PAGES HEREOF
(each individually referred to herein as a "LENDER" and collectively as
"LENDERS"), CANADIAN IMPERIAL BANK OF COMMERCE, acting through one or more of
its agencies, branches or affiliates ("CIBC"), as administrative agent for
Lenders (in such capacity, "ADMINISTRATIVE AGENT"), Fleet Securities Inc.,
acting through one or more of its branches, or affiliates ("FLEET"), as
syndication agent (in such capacity, "SYNDICATION AGENT") and CIBC WORLD MARKETS
CORP. and FLEET as co-lead arrangers (each in such capacity, "CO-LEAD ARRANGER";
collectively in such capacity the "CO-LEAD ARRANGERS").
R E C I T A L S
WHEREAS, Borrowers desire that Lenders extend certain credit facilities
to Borrowers, the proceeds of which will be used for:
(i) the refinancing of funded Indebtedness under Meditrust's existing
credit facilities and the replacement of certain existing letters of credit in
connection therewith (the "REFINANCING"); and thereafter
(ii) general corporate purposes of Borrowers and their
Subsidiaries.
WHEREAS, Borrowers desire to secure all of the Obligations hereunder
and under the other Loan Documents by granting to Administrative Agent, on
behalf of Lenders, a First Priority Lien on certain personal property consisting
of a pledge of all of the capital stock of each of its Subsidiaries owned by
such Borrower (except to the extent excluded by the terms of the Collateral
Documents), certain intercompany notes and certain mortgage loans; and
WHEREAS, certain of the Subsidiaries of Borrowers have agreed to
guarantee the Obligations hereunder and under the other Loan Documents and to
secure their guaranties by granting to Administrative Agent, on behalf of
Lenders, a First Priority Lien on certain personal property consisting of a
pledge of all of the capital stock of each of their respective Subsidiaries
owned by such Subsidiary (except to the extent excluded by the terms of the
Collateral Documents), certain intercompany notes and certain mortgage loans:
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Borrowers, Lenders and Administrative
Agent agree as follows:
CREDIT AGREEMENT
SECTION 1. DEFINITIONS
1.1 CERTAIN DEFINED TERMS.
The following terms used in this Agreement shall have the
following meanings:
"ACCOUNTS" means all present and future rights of Borrowers to payment
for goods sold or leased or for services rendered (including any such rights
evidenced by instruments or chattel paper), whether due or to become due,
whether now existing or hereinafter arising and wherever arising, and whether or
not they have been earned by performance.
"ADJUSTED LIBOR" means, for any Interest Rate Determination Date with
respect to an Interest Period for a LIBOR Loan, the rate per annum obtained by
DIVIDING (x) the rate of interest equal to (a) the rate per annum determined on
the basis of the rate for deposits in Dollars for a period equal to such
Interest Period commencing on the first day of such Interest Period and
appearing on Telerate Screen 3750 at or about 11:00 A.M., London time, two
Business Days prior to the commencement of such Interest Period, or (b) if such
a rate does not appear on Telerate Screen 3750, the average of the rates per
annum at which Dollar deposits in immediately available funds are offered to
CIBC in the interbank LIBOR market as at or about 11:00 A.M. (New York City
time) two Business Days prior to the beginning of such Interest Period for
delivery on the first day of such Interest Period, and for a period
approximately equal to such Interest Period, BY (y) a percentage equal to 100%
MINUS the stated maximum rate (expressed as a percentage) of all reserve
requirements (including any marginal, emergency, supplemental, special or other
reserves) applicable on such Interest Rate Determination Date to any member bank
of the Federal Reserve System in respect of "Eurocurrency liabilities" as
defined in Regulation D (or any successor category of liabilities under
Regulation D), it being acknowledged that, as of the date hereof, such reserve
requirement is equal to zero (0).
"ADMINISTRATIVE AGENT" has the meaning assigned to that term in the
introduction to this Agreement and also means and includes any successor
Administrative Agent appointed pursuant to subsection 9.5A.
"ADMINISTRATIVE AGENT'S OFFICE" means (i) the office of Administrative
Agent located at CIBC, 425 Lexington Avenue, New York, NY 10017, or (ii) such
other office of Administrative Agent as may from time to time hereafter be
designated as such in a written notice delivered by Administrative Agent to
Borrowers and each Lender.
"AFFECTED LENDER" has the meaning assigned to that term in subsection
2.6C.
"AFFECTED LOANS" has the meaning assigned to that term in subsection
2.6C.
"AFFILIATE", as applied to any Person, means any other Person that, (i)
directly or indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, such given Person, (ii) directly
or indirectly beneficially owns or holds 10% or, in the case of a Franchisee,
25% or more of any class of voting stock or partnership or membership or other
voting interest of such Person or any Subsidiary of such
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CREDIT AGREEMENT
Person, or (iii) 10% or, in the case of a Franchisee, 25% or more of the voting
stock or partnership or membership or other voting interest of which is directly
or indirectly beneficially owned or held by such Person or a Subsidiary of such
Person. For the purposes of this definition, "control" (including, with
correlative meanings, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of that Person, whether through the ownership of voting Securities or
by contract or otherwise.
"AGREEMENT" means this Credit Agreement dated as of June 6, 2001.
"ALLOCATION LETTER" means a letter from Administrative Agent to each
Lender and Borrowers setting forth such Lender's Commitment and Pro Rata Share,
as the same may be modified from time to time thereafter pursuant to this
Agreement.
"ANNUAL CAPEX AMOUNT" is defined in subsection 7.8A.
"APPLICABLE BASE RATE MARGIN" means, as at any date of determination
(a) with respect to Term Loans that are Base Rate Loans, 2.00% per annum, and
(b) with respect to Revolving Loans that are Base Rate Loans, a percentage per
annum as set forth below opposite the applicable Total Leverage Ratio:
TOTAL LEVERAGE RATIO APPLICABLE BASE RATE MARGIN
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greater than or equal to 4.00:1.00 2.00%
less than 4.00:1.00 1.75%
but greater than or equal to 3.50:1.00
less than 3.50:1.00 1.50%
; PROVIDED that until the date that is three Business Days after the date on
which Borrowers deliver the Margin Determination Certificate required to be
delivered to Administrative Agent pursuant to subsection 6.1(xv) for the Fiscal
Quarter ending September 30, 2001, the Applicable Base Rate Margin for Revolving
Loans that are Base Rate Loans shall be 2.00% per annum.
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CREDIT AGREEMENT
"APPLICABLE LIBOR MARGIN" means (a) with respect to Term Loans that are
LIBOR Loans, 3.50% per annum, and (b) with respect to Revolving Loans that are
LIBOR Loans, a percentage per annum as set forth below opposite the applicable
Total Leverage Ratio:
TOTAL LEVERAGE RATIO APPLICABLE LIBOR MARGIN
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greater than or equal to 4.00:1.00 3.50%
less than 4.00:1.00 3.25%
but greater than or equal to 3.50:1.00
less than 3.50:1.00 3.00%
; PROVIDED that until the date that is three Business Days after the date on
which Borrowers deliver the Margin Determination Certificate required to be
delivered to Administrative Agent pursuant to subsection 6.1(xv) for the Fiscal
Quarter ending September 30, 2001, the Applicable LIBOR Margin for Revolving
Loans that are LIBOR Loans shall be 3.50% per annum.
"APPROVED FUND" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"ASSET SALE" means (x) the securitization including, without
limitation, the securitization of Lodging Assets in connection with any
transaction permitted pursuant to subsection 7.1(iv) or (y) the sale (in any
single transaction or related series of transactions) by any Borrower or any of
their Subsidiaries to any Person other than any Borrower or any Subsidiary
Guarantor of (i) any of the capital stock or other equity or ownership interests
of any Subsidiary of any Borrower, (ii) substantially all of the assets of any
division or line of business of any Borrower or any of their Subsidiaries, or
(iii) any other assets (whether tangible or intangible) of any Borrower or any
of their Subsidiaries (other than (a) dispositions of worn-out and obsolete
equipment no longer useful in any Borrower's or any Subsidiary's business,
consistent with past practices of such Borrower or Subsidiary) (b) dispositions
of Lodging Assets (other than Lodging Assets subject to securitization under
subsection 7.1(iv)) and (c) sales of other assets to the extent that the
aggregate value of such assets does not exceed $5,000,000 in any Fiscal Year of
Borrowers).
"ASSIGNMENT AGREEMENT" means an Assignment Agreement in substantially
the form of EXHIBIT IX annexed hereto.
"AVAILABLE BASKET AMOUNT" means as at any date of determination, an
amount equal to $36,000,000 MINUS the aggregate amount of all Permitted
Reinvestment Capital Expenditures made with respect to one or more Real Property
Assets to the extent such Permitted Reinvestment Capital Expenditures exceed the
amount of casualty loss insurance
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CREDIT AGREEMENT
proceeds or eminent domain proceeds (or proceeds from a sale in lieu thereof)
actually received with respect thereto.
"BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy", as now and hereafter in effect, or any successor statute.
"BASE RATE" means, at any time, the higher of (x) the Reference Rate or
(y) the rate which is one half of 1% in excess of the Federal Funds Effective
Rate.
"BASE RATE LOANS" means Loans bearing interest at rates determined by
reference to the Base Rate as provided in subsection 2.2A.
"BORROWERS" has the meaning assigned to that term in the recitals.
"BUSINESS DAY" means (i) any day excluding Saturday, Sunday and any day
which is a legal holiday under the laws of the State of New York or is a day on
which banking institutions located in such state are authorized or required by
law or other governmental action to close, and (ii) with respect to all notices,
determinations, fundings and payments in connection with the Adjusted LIBOR or
any LIBOR Loan, any day that (a) is a Business Day described in clause (i)
above, and (b) is a day for trading by and between banks in Dollar deposits in
the London Interbank Market.
"CAPITAL EXPENDITURES" means, for any period, the sum of (i) the
aggregate of all expenditures (paid in Cash or other consideration and including
that portion of Capital Leases which is capitalized on the consolidated balance
sheet of Borrowers and their Subsidiaries) by Borrowers and their Subsidiaries
during that period that, in conformity with GAAP, are included in "additions to
property, plant or equipment" or comparable items reflected in the consolidated
statement of cash flows of Borrowers and their Subsidiaries PLUS (ii) to the
extent not covered by clause (i) of this definition, the aggregate of all
expenditures by Borrowers and their Subsidiaries during that period to acquire
(by purchase or otherwise) the business, property or fixed assets of any Person,
or the capital stock or other evidence of beneficial ownership of any Person
that, as a result of such acquisition, becomes or remains a Subsidiary of
Borrowers; PROVIDED, however, that Capital Expenditures shall not include any
expenditures for Investments permitted under subsection 7.3(i).
"CAPITAL EXPENDITURE RESERVE" means, for any period, as at any date of
determination, an amount equal to 5.00% of net room revenues generated by
Lodging Assets for such period, as determined on a Pro Forma Basis.
"CAPITAL LEASE", as applied to any Person, means any lease of any
property (whether real, personal or mixed) by that Person as lessee that, in
conformity with GAAP, is accounted for as a capital lease on the balance sheet
of that Person.
"CAP RATE" means 12% initially as such rate may be adjusted from time
to time upon the mutual agreement of Borrowers and Co-Lead Arrangers.
"CASH" means money, currency or a credit balance in a Deposit Account.
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CREDIT AGREEMENT
"CASH EQUIVALENTS" means, as at any date of determination, (i)
securities issued or directly and fully guaranteed or insured by the United
States government or any agency or instrumentality thereof or any state having
maturities of not more than one year after the date of acquisition; (ii)
certificates of deposit and Eurodollar time deposits with maturities of one year
or less from the date of acquisition, bankers' acceptances with maturities not
exceeding one year and overnight bank deposits, in each case with any Lender or
any domestic commercial bank or U.S. branch of a foreign commercial bank having
capital and surplus in excess of $250,000,000 and a Thompson Bank Watch Rating
of "B" or better; (iii) repurchase obligations with a term of not more than
seven days for underlying securities of the types described in clauses (i) and
(ii) above entered into with any financial institution meeting the
qualifications specified in said clause (ii); (iv) commercial paper having at
least a rating of A by S&P and/or A2 by Moody's and in each case maturing within
270 days after the date of acquisition; (v) real estate loan pool
participations, guaranteed by an entity with an A rating given by S&P or an A2
rating given by Moody's, or better rated credit; and (vi) shares of any mutual
fund or any money market fund, in each case that has its assets primarily
invested in the types of investments referred to in clauses (i) through (iv).
"CHANGE OF CONTROL" means any of the following: (i) any Person (other
than any Borrower in connection with the Conversion), or any Person acting in
concert with one or more other Persons, shall have acquired beneficial
ownership, directly or indirectly, of Securities of either Borrower (or other
Securities convertible into such Securities) representing 30% or more of the
combined voting power of all Securities of such Borrower entitled to vote in the
election of members of the Governing Body of such Borrower, other than
Securities having such power only by reason of the happening of a contingency;
(ii) the occurrence of a change in the composition of the Governing Body of
either Borrower such that a majority of the members of any such Governing Body
are not Continuing Members; and (iii) the occurrence of any "Change in Control"
or similar provision as defined in any Senior Note Document, Subordinated
Indebtedness or Refinancing Indebtedness. As used herein, the term "beneficially
own" or "beneficial ownership" shall have the meanings set forth therefor in the
Exchange Act and the rules and regulations promulgated thereunder.
"CIBC" has the meaning assigned to that term in the introduction to
this Agreement.
"CLASS" means, as applied to Lenders, each of the following two classes
of Lenders: (i) Lenders having Term Loan Exposure, and (ii) Lenders having
Revolving Loan Exposure.
"CLOSING DATE" means the date on or before June 8, 2001, on which the
initial Loans are made.
"CO-LEAD ARRANGERS" has the meaning assigned to that term in the
recitals.
"COLLATERAL" means, collectively, all of the property in which Liens
are purported to be granted pursuant to the Collateral Documents as security for
the Obligations.
"COLLATERAL DOCUMENTS" means the Pledge Agreement and all other
instruments or documents delivered by any Loan Party pursuant to this Agreement
or any of the other Loan Documents in order to grant to Administrative Agent, on
behalf of Lenders and the Senior
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CREDIT AGREEMENT
Notes and any senior Refinancing Indebtedness required to be equally and ratably
secured thereby, a Lien on any Collateral of that Loan Party as security for the
Obligations and such other Indebtedness.
"COMMITMENTS" means the commitments of Lenders to make Loans as set
forth in subsection 2.1A.
"COMPLIANCE CERTIFICATE" means a certificate substantially in the form
of EXHIBIT VI annexed hereto delivered to Administrative Agent by Borrowers
pursuant to subsection 6.1(iv).
"CONSOLIDATED EBITDA" means, for any period, without duplication the
sum of the amounts for such period of (i) Consolidated Net Income, (ii)
Consolidated Net Interest Expense, (iii) provisions for taxes based on income,
(iv) total depreciation expense, (v) total amortization expense, (vi) other
non-recurring and non-cash items reducing Consolidated Net Income, (vii)
Restructuring Charges, (viii) deferred financing amounts, and (ix) FASB 133
adjustments, LESS any non-recurring and non-cash items increasing Consolidated
Net Income, all of the foregoing as determined on a consolidated basis for
Borrowers and their Subsidiaries (including without limitation discontinued
operations) in conformity with GAAP and to be calculated on a Pro Forma Basis.
"CONSOLIDATED NET INCOME" means, for any period, the net income (or
loss) (before payments of preferred dividends) of Borrowers and their
Subsidiaries on a consolidated basis for such period taken as a single
accounting period determined in conformity with GAAP; PROVIDED that there shall
be excluded (i) the income (or loss) of any Person (other than a Subsidiary of
Borrowers) in which any other Person (other than Borrowers or any of their
Subsidiaries) has a joint interest, except to the extent of the amount of
dividends or other distributions actually paid to Borrowers or any of their
Subsidiaries by such Person during such period, (ii) the income of any
Subsidiary of Borrowers to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of that income is not at
the time permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental regulation
applicable to that Subsidiary, (iii) any after-tax gains or losses attributable
to sales of assets and (iv) (to the extent not included in clauses (i) through
(iii) above) any net extraordinary gains or net extraordinary losses as
determined in conformity with GAAP.
"CONSOLIDATED NET INTEREST EXPENSE" means, for any period, total
interest expense (including that portion attributable to Capital Leases in
accordance with GAAP), net of interest income, on a consolidated basis in
accordance with GAAP (excluding the treatment of derivatives and any
marking-to-market required in connection therewith under FASB 133) for Borrowers
and their Subsidiaries with respect to all outstanding Indebtedness, including
all commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers' acceptance financing and net costs under Interest
Rate Agreements, but excluding, however, any deferred financing expenses, such
as amounts referred to in subsection 2.3B and payable to Administrative Agent
and/or Lenders. Consolidated Net Interest Expense shall be calculated on a Pro
Forma Basis.
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CREDIT AGREEMENT
"CONSOLIDATED NET TANGIBLE ASSETS" means, as at any date of
determination, the aggregate amount of total assets (less applicable reserves
and other properly deductible items) LESS (i) all current liabilities and (ii)
all goodwill, trade names, trademarks, patents, unamortized debt discount, and
expenses and other like intangibles of the Borrowers and their Subsidiaries, all
as set forth on the most recent balance sheet of the Borrowers and their
Subsidiaries and prepared in accordance with GAAP.
"CONSOLIDATED SUBSIDIARY" means at any date any Subsidiary or other
entity which is consolidated with the Borrowers in accordance with GAAP.
"CONSOLIDATED TANGIBLE NET WORTH" means, as at any date of
determination, and without duplication, total shareholders equity of Borrowers
and their Subsidiaries on a consolidated basis determined in conformity with
GAAP, MINUS the Intangible Assets of Borrowers and their Subsidiaries on a
consolidated basis determined in conformity with GAAP, PLUS the Net Worth
Adjustment Amount. For purposes of this definition, "Intangible Assets" means
with respect to any such intangible assets, the amount (to the extent reflected
in determining such combined consolidated equity) of (i) all write-ups
subsequent to December 31, 2000 in the book value of any assets owned by the
Borrowers or their Subsidiaries and (ii) goodwill, patents, trademarks, service
marks, trade names, copyrights, organization or developmental expenses and other
intangible assets.
"CONTINGENT OBLIGATION", as applied to any Person, means without
duplication any direct or indirect liability, contingent or otherwise, of that
Person (i) with respect to any Indebtedness, lease, dividend or other obligation
of another if the primary purpose or intent thereof by the Person incurring the
Contingent Obligation is to provide assurance to the obligee of such obligation
of another that such obligation of another will be paid or discharged, or that
any agreements relating thereto will be complied with, or that the holders of
such obligation will be protected (in whole or in part) against loss in respect
thereof, (ii) with respect to any letter of credit issued for the account of
that Person or as to which that Person is otherwise liable for reimbursement of
drawings, or (iii) under Hedge Agreements. Contingent Obligations shall include
without duplication (a) the direct or indirect guaranty, endorsement (otherwise
than for collection or deposit in the ordinary course of business), co-making,
discounting with recourse or sale with recourse by such Person of the obligation
of another, (b) the obligation to make take-or-pay or similar payments if
required regardless of non-performance by any other party or parties to an
agreement, and (c) any liability of such Person for the obligation of another
through any agreement (contingent or otherwise) (X) to purchase, repurchase or
otherwise acquire such obligation or any security therefor, or to provide funds
for the payment or discharge of such obligation (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise) or (Y) to
maintain the solvency or any balance sheet item, level of income or financial
condition of another if, in the case of any agreement described under subclauses
(X) or (Y) of this sentence, the primary purpose or intent thereof is as
described in the preceding sentence. The amount of any Contingent Obligation
shall be equal to the amount of the obligation so guaranteed or otherwise
supported at any time of determination or, if less, the amount to which such
Contingent Obligation is specifically limited. Contingent Obligations in respect
of loan obligations shall be determined based on the amount of outstanding loans
and not on the basis of available but unused commitments.
8
CREDIT AGREEMENT
"CONTINUING MEMBER" means, as of any date of determination, any member
of the Governing Body of a Borrower who (i) was a member of such Governing Body
on the Closing Date or (ii) was nominated for election or elected to such
Governing Body with the affirmative vote of a majority of the members who were
either members of such Governing Body on the Closing Date or whose nomination or
election was previously so approved.
"CONTRACTUAL OBLIGATION", as applied to any Person, means any provision
of any Security issued by that Person or of any material indenture, mortgage,
deed of trust, contract, undertaking, agreement or other instrument to which
that Person is a party or by which it or any of its properties is bound or to
which it or any of its properties is subject.
"CONVERSION" means any reorganization of the structure of either or
both of the Borrowers which involves a change in Meditrust's status as a REIT,
including the creation of any Subsidiary corporation which is classified as a
REIT in accordance with the provisions of subsection 7.7(vi) and which
reorganization has been approved by Administrative Agent and Syndication Agent.
"CURRENCY AGREEMENT" means any foreign exchange contract, currency swap
agreement, futures contract, option contract, synthetic cap or other similar
agreement or arrangement to which Borrowers or any of their Subsidiaries is a
party.
"DEPOSIT ACCOUNT" means a demand, time, savings, passbook or like
account with a bank, savings and loan association, credit union or like
organization, other than an account evidenced by a negotiable certificate of
deposit.
"DOLLARS" and the sign "$" mean the lawful money of the United States
of America.
"ELIGIBLE ASSIGNEE" means (A)(i) a commercial bank organized under the
laws of the United States or any state thereof; (ii) a savings and loan
association or savings bank organized under the laws of the United States or any
state thereof; (iii) a commercial bank organized under the laws of any other
country or a political subdivision thereof (provided that (x) such bank is
acting through a branch or agency located in the United States or (y) such bank
is organized under the laws of a country that is a member of the Organization
for Economic Cooperation and Development or a political subdivision of such
country); (iv) any other entity which is an "accredited investor" (as defined in
Regulation D under the Securities Act) which extends credit or buys loans as one
of its businesses including insurance companies, mutual funds, lease financing
companies and investment funds and any Approved Funds; (B) a Lender, an
Affiliate of a Lender, or an Approved Fund; and (C) any other Person (other than
a natural Person) approved by (1) Administrative Agent, (2) in the case of any
assignment of a Revolving Loan, Issuing Lender, and (3) unless (x) such Person
is taking delivery of an assignment in connection with physical settlement of a
credit derivatives transaction, or (y) an Event of Default or Potential Event of
Default has occurred and is continuing, Borrowers (each such approval not to be
unreasonably withheld or delayed). If the consent of Borrowers to an assignment
to an Eligible Assignee is required hereunder (including a consent to an
assignment which does not meet the minimum assignment thresholds specified in
subsection 10.1B(i)), Borrowers shall be deemed to have given its consent ten
Business Days after the date notice thereof has been delivered by the
9
CREDIT AGREEMENT
assigning Lender (through Administrative Agent) unless such consent is expressly
refused by Borrowers prior to such tenth Business Day.
"EMPLOYEE BENEFIT PLAN" means any "employee benefit plan" as defined in
Section 3(3) of ERISA which is or was maintained or contributed to by Borrowers,
any of their Subsidiaries or any of their respective ERISA Affiliates.
"ENVIRONMENTAL CLAIM" means any investigation, notice, notice of
violation, claim, action, suit, proceeding, demand, abatement order or other
order or directive (conditional or otherwise), by any governmental authority or
any other Person, arising (i) pursuant to or in connection with any actual or
alleged violation of any Environmental Law, (ii) in connection with any
Hazardous Materials or any actual or alleged Hazardous Materials Activity, or
(iii) in connection with any actual or alleged damage, injury, threat or harm to
health, safety, natural resources or the environment.
"ENVIRONMENTAL LAWS" means any and all current or future statutes,
ordinances, orders, rules, regulations, guidance documents, judgments,
Governmental Authorizations, or any other requirements of governmental
authorities relating to (i) environmental matters, including those relating to
any Hazardous Materials Activity, or (ii) the generation, use, storage,
transportation or disposal of Hazardous Materials, in any manner applicable to
Borrowers or any of their Subsidiaries or any Real Property Asset, including the
Comprehensive Environmental Response, Compensation, and Liability Act (42
U.S.C.ss. 9601 ET SEQ.), the Hazardous Materials Transportation Act (49
U.S.C.ss. 1801 ET SEQ.), the Resource Conservation and Recovery Act (42 U.S.C.
ss. 6901 ET SEQ.), the Federal Water Pollution Control Act (33 U.S.C.ss. 1251 ET
SEQ.), the Clean Air Act (42 U.S.C. ss. 7401 ET SEQ.), the Toxic Substances
Control Act (15 U.S.C.ss. 2601 ET SEQ.), the Federal Insecticide, FungicidE and
Rodenticide Act (7 U.S.C.ss.136 ET SEQ.), the Occupational Safety and Health Act
(29 U.S.C.ss. 651 ET SEQ.), the Oil Pollution Act (33 U.S.C.ss. 2701 ET SEQ.)
and the Emergency Planning and Community Right-to-Know Act (42 U.S.C.ss. 11001
ET SEQ.), each as amended or supplemented, any analogous present or future state
or local statutes or laws, and any regulations promulgated pursuant to any of
the foregoing.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA AFFILIATE" means, as applied to any Person, (i) any corporation
that is a member of a controlled group of corporations within the meaning of
Section 414(b) of the Internal Revenue Code of which that Person is a member;
(ii) any trade or business (whether or not incorporated) that is a member of a
group of trades or businesses under common control within the meaning of Section
414(c) of the Internal Revenue Code of which that Person is a member; and (iii)
any member of an affiliated service group within the meaning of Section 414(m)
or (o) of the Internal Revenue Code of which that Person, any corporation
described in clause (i) above or any trade or business described in clause (ii)
above is a member. Any former ERISA Affiliate of Borrowers or any of their
Subsidiaries shall continue to be considered an ERISA Affiliate of Borrowers or
such Subsidiary within the meaning of this definition with respect to the period
such entity was an ERISA Affiliate of Borrowers or such Subsidiary and with
respect to liabilities arising after such period for
10
CREDIT AGREEMENT
which Borrowers or such Subsidiary could be liable under the Internal Revenue
Code or ERISA.
"ERISA EVENT" means (i) a "reportable event" within the meaning of
Section 4043 of ERISA and the regulations issued thereunder with respect to any
Pension Plan (excluding those for which the provision for 30-day notice to the
PBGC has been waived by regulation); (ii) the failure to meet the minimum
funding standard of Section 412 of the Internal Revenue Code with respect to any
Pension Plan (whether or not waived in accordance with Section 412(d) of the
Internal Revenue Code) or the failure to make by its due date a required
installment under Section 412(m) of the Internal Revenue Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (iv) the
withdrawal by Borrowers, any of their Subsidiaries or any of their respective
ERISA Affiliates from any Pension Plan with two or more contributing sponsors or
the termination of any such Pension Plan resulting in liability pursuant to
Section 4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (vi) the imposition of liability
on Borrowers, any of their Subsidiaries or any of their respective ERISA
Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA; (vii) the withdrawal of Borrowers, any
of their Subsidiaries or any of their respective ERISA Affiliates in a complete
or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA)
from any Multiemployer Plan if there is any potential liability therefor, or the
receipt by Borrowers, any of their Subsidiaries or any of their respective ERISA
Affiliates of notice from any Multiemployer Plan that it is in reorganization or
insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to
terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the
occurrence of an act or omission which could give rise to the imposition on
Borrowers, any of their Subsidiaries or any of their respective ERISA Affiliates
of material fines, penalties, taxes or related charges under Chapter 43 of the
Internal Revenue Code or under Section 409, Section 502(c), (i) or (l), or
Section 4071 of ERISA in respect of any Employee Benefit Plan; (ix) the
assertion of a material claim (other than routine claims for benefits) against
any Employee Benefit Plan other than a Multiemployer Plan or the assets thereof,
or against Borrowers, any of their Subsidiaries or any of their respective ERISA
Affiliates in connection with any Employee Benefit Plan; (x) receipt from the
Internal Revenue Service of notice of the failure of any Pension Plan (or any
other Employee Benefit Plan intended to be qualified under Section 401(a) of the
Internal Revenue Code) to qualify under Section 401(a) of the Internal Revenue
Code, or the failure of any trust forming part of any Pension Plan to qualify
for exemption from taxation under Section 501(a) of the Internal Revenue Code;
or (xi) the imposition of a Lien pursuant to Section 401(a)(29) or 412(n) of the
Internal Revenue Code or pursuant to ERISA with respect to any Pension Plan.
"EVENT OF DEFAULT" means each of the events set forth in Section 8.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
11
CREDIT AGREEMENT
"EXECUTIVE OFFICER" means with respect to any Person, the president,
chief executive officer, chief operating officer, chief financial officer,
general counsel or other officer of such Person, however designated, with
responsibilities similar to the foregoing officers.
"EXISTING CREDIT FACILITY" means that certain Credit Agreement, dated
as of July 17, 1998, by and among Meditrust, Morgan Guaranty Trust Company of
New York, as Administrative Agent, Bankers Trust Company, as Syndication Agent,
BankBoston, N.A., as Co-Documentation Agent, Fleet National Bank, as
Co-Documentation Agent, and the Banks as listed therein, as amended by an
Amendment to Credit Agreement dated as of November 23, 1998 and the Second
Amendment to Credit Agreement dated as of March 10, 1999 and the Third Amendment
to Credit Agreement dated as of June 30, 2000 and the Fourth Amendment to Credit
Agreement dated as of August 31, 2000.
"EXISTING LETTER OF CREDIT" shall have the meaning provided in
subsection 3.1C.
"EXISTING PREFERRED STOCK" means all preferred stock of Borrowers or
their Subsidiaries which is described on SCHEDULE 7.5.
"EXTENSION NOTICE" means an irrevocable written notice from Borrowers
to Administrative Agent delivered from time to time under subsections 2.9A
and/or 2.9B pursuant to which Borrowers elect to extend the Term Loan Maturity
Date and/or Revolving Loan Commitment Termination Date, as applicable, and each
such Extension Notice shall be accompanied by the Officers' Certificate required
by subsection 2.9A(iv) or 2.9B(iii), as applicable.
"FAIR MARKET VALUE" means, as it relates to certain Lodging Assets, the
quotient of (a) Property Level Cash Flow divided by (b) the Cap Rate.
"FEDERAL FUNDS EFFECTIVE RATE" means, for any period, a fluctuating
interest rate equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published for such day (or,
if such day is not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by Administrative Agent from three Federal funds brokers
of recognized standing selected by Administrative Agent.
"FIRST PRIORITY" means, with respect to any Lien purported to be
created in any Collateral pursuant to any Collateral Document, that (i) such
Lien is perfected and has priority over any other Lien on such Collateral (other
than Liens permitted pursuant to subsection 7.2), and (ii) such Lien is the only
Lien (other than Liens permitted pursuant to subsection 7.2) to which such
Collateral is subject.
"FISCAL QUARTER" means a fiscal quarter of any Fiscal Year.
"FISCAL YEAR" means the fiscal year of Borrowers and their Subsidiaries
ending on December 31 of each calendar year.
12
CREDIT AGREEMENT
"FIXED CHARGES" means, for any period, the sum (without duplication) of
the amounts for such period of (i) Consolidated Net Interest Expense, (ii) all
regularly scheduled principal payments to be made by Borrowers and their
Subsidiaries (whether or not such payments are actually made) on all
Indebtedness of Borrowers and their Subsidiaries (including the principal
component of all Capital Leases but excluding balloon payments due on
Indebtedness at maturity or earlier acceleration) and (iii) dividends paid on
the preferred Securities of the Borrower or any of their Subsidiaries during
such period; PROVIDED that (a) Fixed Charges for the first Fiscal Quarter ended
after the Closing Date shall be equal to the Fixed Charges for such first Fiscal
Quarter multiplied by four, (b) Fixed Charges for the second Fiscal Quarter
ended after the Closing Date shall be equal to the Fixed Charges for such Fiscal
Quarter and the preceding Fiscal Quarter multiplied by two, and (c) Fixed
Charges for the third Fiscal Quarter ended after the Closing Date shall be equal
to the Fixed Charges for such third Fiscal Quarter and the preceding two Fiscal
Quarters multiplied by one and one-third.
"FLOOD HAZARD PROPERTY" means any real property located in an area
designated by the Federal Emergency Management Agency as having special flood or
mud slide hazards.
"FRANCHISE ARRANGEMENTS" means contracts, agreements and other
arrangements between Borrowers or their Subsidiaries and Franchisees pursuant to
which Borrowers or their Subsidiaries receive royalty, service, marketing,
reservation and other fees and compensation in the ordinary course of Borrowers'
or their Subsidiaries' business.
"FRANCHISEES" means the Persons who are franchise owners or operators
of Lodging Assets.
"FUND" means any Person (other than a natural Person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of its business.
"FUNDING DATE" means the date of the funding of a Loan.
"GAAP" means, subject to the limitations on the application thereof set
forth in subsection 1.2, generally accepted accounting principles set forth in
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as may be approved by a significant segment of the accounting
profession in the United States of America, in each case as the same are
applicable to the circumstances as of the date of determination.
"GOVERNING BODY" means the board of directors or other body having the
power to direct or cause the direction of the management and policies of a
Person that is a corporation, partnership, trust or limited liability company.
"GOVERNMENTAL AUTHORIZATION" means any permit, license, authorization,
plan, directive, consent order or consent decree of or from any federal, state
or local governmental authority, agency or court.
13
CREDIT AGREEMENT
"HAZARDOUS MATERIALS" means (i) any chemical, material or substance at
any time defined as or included in the definition of "hazardous substances",
"hazardous wastes", "hazardous materials", "extremely hazardous waste", acutely
hazardous waste", "radioactive waste", "biohazardous waste", "pollutant", "toxic
pollutant", "contaminant", "restricted hazardous waste", "infectious waste",
"toxic substances", or any other term or expression intended to define, list or
classify substances by reason of properties harmful to health, safety or the
indoor or outdoor environment (including harmful properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive
toxicity, "TCLP toxicity" or "EP toxicity" or words of similar import under any
applicable Environmental Laws); (ii) any oil, petroleum, petroleum fraction or
petroleum derived substance; (iii) any drilling fluids, produced waters and
other wastes associated with the exploration, development or production of crude
oil, natural gas or geothermal resources; (iv) any flammable substances or
explosives; (v) any radioactive materials; (vi) any asbestos-containing
materials; (vii) urea formaldehyde foam insulation; (viii) electrical equipment
which contains any oil or dielectric fluid containing polychlorinated biphenyls;
(ix) pesticides; and (x) any other chemical, material or substance, exposure to
which is prohibited, limited or regulated by any governmental authority or which
may or could pose a hazard to the health and safety of the owners, occupants or
any Persons in the vicinity of any Real Property Asset or to the indoor or
outdoor environment.
"HAZARDOUS MATERIALS ACTIVITY" means any past, current, proposed or
threatened activity, event or occurrence involving any Hazardous Materials,
including the use, manufacture, possession, storage, holding, presence,
existence, location, Release, threatened Release, discharge, placement,
generation, transportation, processing, construction, treatment, abatement,
removal, remediation, disposal, disposition or handling of any Hazardous
Materials, and any corrective action or response action with respect to any of
the foregoing.
"HEALTHCARE ASSETS" means hospitals, long-term care facilities,
rehabilitation facilities, independent or assisted living facilities for
seniors, medical office buildings and substance abuse facilities and similar
businesses, all buildings, fixtures or other improvements located related
thereto and all personal property, whether tangible or intangible, owned by
Borrowers or their Subsidiaries located at or related to the foregoing
properties and any other assets classified by the Borrowers as Healthcare Assets
in their financial statements and any mortgage loans, notes receivable, accounts
receivable or other financing provided by Borrowers or their Subsidiaries to the
owners or operators of any of the foregoing.
"HEDGE AGREEMENT" means an Interest Rate Agreement or a Currency
Agreement designed to hedge against fluctuations in interest rates or currency
values, respectively.
"IMMATERIAL SUBSIDIARIES" means Subsidiaries of the Borrowers which in
the aggregate for all such Subsidiaries (a) do not own assets with an aggregate
value in excess of $15,000,000 and (b) do not generate aggregate revenues in
excess of $15,000,000 in any Fiscal Year.
14
CREDIT AGREEMENT
"INDEBTEDNESS", as applied to any Person, means without duplication (i)
all indebtedness for borrowed money including obligations evidenced by bonds,
debentures or similar instruments, PLUS (ii) that portion of obligations with
respect to Capital Leases that is properly classified as a liability on a
balance sheet in conformity with GAAP, PLUS (iii) notes payable and drafts
accepted representing extensions of credit whether or not representing
obligations for borrowed money, PLUS (iv) any obligation owed for all or any
part of the deferred purchase price of property or services (excluding any such
obligations incurred under ERISA), which purchase price is (a) due more than six
months from the date of incurrence of the obligation in respect thereof or (b)
evidenced by a note or similar written instrument, PLUS (v) all indebtedness
secured by any Lien on any property or asset owned or held by that Person
regardless of whether the indebtedness secured thereby shall have been assumed
by that Person or is nonrecourse to the credit of that Person. Obligations under
Interest Rate Agreements and Currency Agreements constitute (X) in the case of
Hedge Agreements, Contingent Obligations, and (Y) in all other cases,
Investments, and in neither case constitute Indebtedness.
"INDEMNITEE" has the meaning assigned to that term in subsection 10.3.
"INTELLECTUAL PROPERTY" means all patents, patent rights, patent
applications, licenses, inventions, trade secrets, trademarks, tradenames,
service marks, copyrights, technology, know-how and proprietary techniques
(including processes and substances) used in or necessary for the conduct of the
business of Borrowers and their Subsidiaries as currently conducted that are
material to the condition (financial or otherwise), business or operations of
Borrowers and their Subsidiaries, taken as a whole.
"INTEREST PAYMENT DATE" means (i) with respect to any Base Rate Loan,
the last Business Day of each March, June, September and December of each year,
commencing on the first such date to occur after the Closing Date, and (ii) with
respect to any LIBOR Loan, the last day of each Interest Period applicable to
such Loan; PROVIDED that in the case of each Interest Period of six months
"Interest Payment Date" shall also include the date that is three months after
the commencement of such Interest Period.
"INTEREST PERIOD" has the meaning assigned to that term in subsection
2.2B.
"INTEREST RATE AGREEMENT" means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or other similar
agreement or arrangement to which Borrowers or any of their Subsidiaries is a
party.
"INTEREST RATE DETERMINATION DATE" means, with respect to any Interest
Period, the second Business Day prior to the first day of such Interest Period.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986, as
amended to the date hereof and from time to time hereafter, and any successor
statute.
"INVESTMENT" means (i) any direct or indirect purchase or other
acquisition by Borrowers or any of their Subsidiaries of, or of a beneficial
interest in, any Securities of any other Person (including any Subsidiary of
Borrowers), (ii) any direct or indirect redemption, retirement, purchase or
other acquisition for value, by any Subsidiary of Borrowers from any
15
CREDIT AGREEMENT
Person other than Borrowers or any of their Subsidiary Guarantors, of any equity
Securities of such Subsidiary, (iii) any direct or indirect loan, advance (other
than advances to employees for moving, entertainment and travel expenses,
drawing accounts and similar expenditures in the ordinary course of business for
business expenses) or capital contribution by Borrowers or any of their
Subsidiaries to any other Person (other than Borrowers or any Subsidiary
Guarantor of Borrowers), including all indebtedness and accounts receivable from
that other Person that are not current assets or did not arise from sales to
that other Person in the ordinary course of business, or (iv) Interest Rate
Agreements or Currency Agreements not constituting Hedge Agreements. The amount
of any Investment shall be the original cost of such Investment PLUS the cost of
all additions thereto, without any adjustments for increases or decreases in
value, or write-ups, write-downs or write-offs with respect to such Investment.
Any direct or indirect redemption, retirement, purchase or other acquisition for
value by any Borrower of any equity Securities of such Borrower shall be a
Restricted Payment and not an Investment.
"ISSUING LENDER" means, with respect to any Letter of Credit, the
Lender which agrees or is otherwise obligated to issue such Letter of Credit,
determined as provided in subsection 3.1B(ii).
"JOINT VENTURE" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; PROVIDED
that in no event shall any Subsidiary of any Person be considered to be a Joint
Venture to which such Person is a party, nor shall any Person in which Borrowers
or any of their Subsidiaries otherwise has a controlling interest be considered
to be a Joint Venture of Borrowers or their Subsidiaries.
"LENDER" and "LENDERS" means the Persons identified as "Lenders" and
listed on the signature pages of this Agreement, together with their successors
and permitted assigns pursuant to subsection 10.1; PROVIDED that the term
"Lenders", when used in the context of a particular Commitment, shall mean
Lenders having that Commitment.
"LETTER OF CREDIT" or "LETTERS OF CREDIT" means any letter of credit or
similar instrument issued for the purpose of supporting (i) Indebtedness of
Borrowers or any of their Subsidiaries or of such other Persons as are
identified on SCHEDULE 7.4 in respect of industrial revenue or development bonds
or financings, (ii) workers' compensation liabilities of Borrowers or any of
their Subsidiaries, (iii) the obligations of third party insurers of Borrowers
or any of their Subsidiaries arising by virtue of the laws of any jurisdiction
requiring third party insurers, (iv) obligations with respect to Capital Leases
or Operating Leases of Borrowers or any of their Subsidiaries, (v) performance,
payment, deposit or surety obligations of Borrowers or any of their
Subsidiaries, in any case if required by law or governmental rule or regulation
or in accordance with custom and practice in the industry, (vi) obligations of
Borrowers or any of their Subsidiaries in the nature of security deposits under
asset purchase agreements, deposits provided to utility providers and other
ordinary course obligations for which letters of credit are customarily
provided, and (vii) Contingent Obligations permitted under subsection 7.4;
PROVIDED that Letters of Credit may not be issued for the purpose of supporting
(a) trade payables or (b) any Indebtedness constituting "antecedent debt" (as
that term is used in Section 547 of the Bankruptcy Code).
16
CREDIT AGREEMENT
"LETTER OF CREDIT USAGE" means, as at any date of determination, the
sum of (i) the maximum aggregate amount which is or at any time thereafter may
become available for drawing under all Letters of Credit then outstanding PLUS
(ii) the aggregate amount of all drawings under Letters of Credit honored by
Issuing Lenders and not theretofore reimbursed by Borrowers (including any such
reimbursement out of the proceeds of Revolving Loans pursuant to subsection
3.3B).
"LIBOR LOANS" means Loans bearing interest at rates determined by
reference to the Adjusted LIBOR as provided in subsection 2.2A.
"LIEN" means any lien, mortgage, pledge, assignment, security interest,
charge or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and any agreement to give
any security interest) and any option, trust or other preferential arrangement
having the practical effect of any of the foregoing.
"LIQUIDITY" means the sum of (i) the amount by which the Revolving Loan
Commitments exceed the Total Utilization of Revolving Loan Commitments PLUS (ii)
the amount of all Cash and Cash Equivalents of Borrowers and their Subsidiaries
in excess of $5,000,000.
"LOAN" or "LOANS" means one or more of the Term Loan or Revolving Loans
or any combination thereof.
"LOAN DOCUMENTS" means this Agreement, the Notes, the Letters of Credit
(and any applications for, or reimbursement agreements or other documents or
certificates executed by Borrowers in favor of an Issuing Lender relating to,
the Letters of Credit), the Subsidiary Guaranty and the Collateral Documents.
"LOAN PARTY" means each of Borrowers and any of Borrower's Subsidiaries
from time to time executing a Loan Document, and "LOAN PARTIES" means all such
Persons, collectively.
"LODGING ASSETS" means hotels, motels, inns, lodges, conference
centers, resorts and similar businesses, all buildings, fixtures or other
improvements related thereto and all personal property, whether tangible or
intangible, located at or related to the foregoing properties and owned, leased
or managed by Borrowers, their Subsidiaries, Joint Ventures or which are subject
to any Franchise Arrangements.
"LODGING EBITDA" means Consolidated EBITDA generated by or solely
attributable to the Lodging Assets and related businesses and which shall
expressly exclude any Consolidated EBITDA generated by or attributable to
Healthcare Assets and related businesses, calculated on a Pro Forma Basis.
"MARGIN DETERMINATION CERTIFICATE" means an Officers' Certificate of
Borrowers delivered (a) with respect to each Fiscal Quarter (other than each
fourth Fiscal Quarter), with the financial statements required pursuant to
subsection 6.1(ii), and (b) with respect to each fourth Fiscal Quarter, with the
financial statements required pursuant to subsection 6.1(iii),
17
CREDIT AGREEMENT
setting forth in reasonable detail the Total Leverage Ratio that is applicable
as of the last day of the fiscal period for which such financial statements and
Officers' Certificate are being delivered.
"MARGIN STOCK" has the meaning assigned to that term in Regulation U of
the Board of Governors of the Federal Reserve System as in effect from time to
time.
"MATERIAL ADVERSE EFFECT" means any act, omission, situation,
circumstance, event or undertaking which could reasonably be expected to have,
singly or in any combination with one or more other acts, omissions, situations,
circumstances, events or undertakings, a materially adverse effect upon (a) the
business, assets, properties, liabilities, financial condition, results of
operations or business prospects of Borrowers and their Subsidiaries taken as a
whole, (b) the ability of Borrowers and their Subsidiaries, taken as a whole, to
perform the obligations of the Loan Parties, taken as a whole, under this
Agreement or any other Loan Document, or (c) the legality, validity, binding
effect, priority, enforceability or admissibility into evidence of any Loan
Documents or the material rights or remedies of Administrative Agent or Lenders
under or in connection with any Loan Documents.
"MATERIAL CONTRACT" means any contract or other arrangement to which
Borrowers or any of their Subsidiaries are a party (other than the Loan
Documents) for which breach, nonperformance, cancellation or failure to renew
could reasonably be expected to have a Material Adverse Effect.
"MOODY'S" means Moody's Investors Service, Inc.
"MULTIEMPLOYER PLAN" means any Employee Benefit Plan that is a
"multiemployer plan" as defined in Section 3(37) of ERISA.
"NEAR-TERM MATURITY NOTES" means those Senior Notes maturing or
redeemable at the holder's option prior to August 31, 2004.
"NET ASSET SALE PROCEEDS" means, with respect to any Asset Sales, Cash
payments (including any Cash received by way of deferred payment pursuant to, or
by monetization of, a note receivable or otherwise, including principal payments
thereon, but only as and when so received) received by any Borrower or any of
its Subsidiaries from such Asset Sales, net of any direct costs incurred in
connection with such Asset Sales, including without limitation (i) taxes
reasonably estimated to be actually payable by any Borrower or any of its
Subsidiaries within two years of the date of such Asset Sales as a result of
such Asset Sales and (ii) payment of the outstanding principal amount of,
premium or penalty, if any, and interest on any Indebtedness of any Borrower or
any of its Subsidiaries (other than the Loans or any Indebtedness secured
equally and ratably with the Loans) that is secured by a Lien on the stock or
assets in question and that is required to be repaid under the terms thereof as
a result of such Asset Sales. It is understood and agreed that with respect to
Asset Sales by or of a non-wholly-owned Subsidiary, Net Asset Sale Proceeds for
purposes of this Agreement shall only include that portion of such Net Asset
Sale Proceeds which is payable or distributable to Borrowers and their direct or
indirect wholly-owned Subsidiaries.
18
CREDIT AGREEMENT
"NET SECURITIES PROCEEDS" means amounts equal to (i) 50% of the Cash
proceeds (net of underwriting discounts and commissions and other reasonable
costs and expenses associated therewith, including reasonable legal fees and
expenses) from the issuance of equity Securities of Borrowers or any of their
Subsidiaries (including Indebtedness convertible into equity Securities) or (ii)
100% of the Cash proceeds (net of underwriting discounts and commissions and
other reasonable costs and expenses associated therewith, including reasonable
legal fees and expenses) from the incurrence or issuance of Indebtedness by
Borrowers or any of their Subsidiaries (excluding the proceeds of any
Refinancing Indebtedness and other Indebtedness permitted under subsections
7.1(iv), 7.1(v) and 7.1(ix)). It is understood and agreed that with respect to
the issuance of equity Securities or Indebtedness by a non-wholly-owned
Subsidiary, Net Securities Proceeds for purposes of this Agreement shall only
include that portion of such Net Securities Proceeds which is payable or
distributable to Borrowers and their direct or indirect wholly-owned
Subsidiaries.
"NET WORTH ADJUSTMENT AMOUNT" means an amount, as at any date of
determination, equal to the sum of (a) the amount, without duplication, of
non-cash charges, liability accruals, and/or write-offs of tangible assets
resulting from the Conversion in an amount reasonably approved by Administrative
Agent and Syndication Agent, plus (b) the aggregate amount, without duplication,
of the adjustments resulting from loss on sale and/or non-cash charges to the
carrying values and/or book value of any Healthcare Assets to the extent
permitted under this Agreement, for any four Fiscal Quarter period then ended on
or prior to such date of determination.
"NOTES" means one or more of the Term Loan Notes or Revolving Notes or
any combination thereof.
"NOTICE OF BORROWING" means a notice substantially in the form of
EXHIBIT I annexed hereto delivered by Borrowers to Administrative Agent pursuant
to subsection 2.1B with respect to a proposed borrowing.
"NOTICE OF CONVERSION/CONTINUATION" means a notice substantially in the
form of EXHIBIT II annexed hereto delivered by Borrowers to Administrative Agent
pursuant to subsection 2.2D with respect to a proposed conversion or
continuation of the applicable basis for determining the interest rate with
respect to the Loans specified therein.
"NOTICE OF ISSUANCE OF LETTER OF CREDIT" means a notice substantially
in the form of EXHIBIT III annexed hereto delivered by Borrowers to
Administrative Agent pursuant to subsection 3.1B(i) with respect to the proposed
issuance of a Letter of Credit.
"OBLIGATIONS" means all obligations of every nature of each Loan Party
from time to time owed to Administrative Agent, Lenders or any of them under the
Loan Documents, whether for principal, interest, reimbursement of amounts drawn
under Letters of Credit, fees, expenses, indemnification or otherwise.
"OFFICER" means the president, chief executive officer, a vice
president, chief financial officer, treasurer, general partner (if an
individual), managing member (if an individual) or other individual appointed by
the governing body or the organizational
19
CREDIT AGREEMENT
documents of a corporation, partnership, trust or limited liability company to
serve in a similar capacity as the foregoing.
"OFFICERS' CERTIFICATE," as applied to any Person that is a
corporation, partnership, trust or limited liability company, means a
certificate executed on behalf of such Person by one or more Officers, or other
designated person approved by Administrative Agent, such approval not to be
unreasonably withheld, of such Person or one or more Officers, or other
designated person approved by Administrative Agent, such approval not to be
unreasonably withheld, of a general partner or a managing member if such general
partner or managing member is a corporation, partnership, trust or limited
liability company; PROVIDED that every Officers' Certificate with respect to the
compliance with a condition precedent to the making of any Loans hereunder shall
include (i) a statement that the Officer or Officers or other approved
designated person making or giving such Officers' Certificate have read such
condition and any definitions or other provisions contained in this Agreement
relating thereto, (ii) a statement that, in the opinion of the signers, they
have made or have caused to be made such examination or investigation as is
reasonably necessary to enable them to express an informed opinion as to whether
or not such condition has been complied with, and (iii) a statement as to
whether, in the opinion of the signers, such condition has been complied with;
PROVIDED that any Officer or other approved designated person executing an
Officers' Certificate shall not have any personal liability in connection
therewith.
"OPERATING LEASE" means, as applied to any Person, any lease (including
leases that may be terminated by the lessee at any time) of any property
(whether real, personal or mixed) that is not a Capital Lease other than any
such lease under which that Person is the lessor.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto.
"PENSION PLAN" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to Section 412 of the Internal Revenue Code
or Section 302 of ERISA.
"PERMITTED ENCUMBRANCES" means the following types of Liens (excluding
any such Lien imposed pursuant to Section 401(a)(29) or 412(n) of the Internal
Revenue Code or by ERISA, any such Lien relating to or imposed in connection
with any Environmental Claim, and any such Lien expressly prohibited by any
applicable terms of any of the Collateral Documents):
(i) Liens for taxes, assessments or governmental
charges or claims the payment of which is not, at the time,
required by subsection 6.3;
(ii) statutory Liens of landlords, statutory Liens of
banks and rights of set-off, statutory Liens of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen,
and other Liens imposed by law, in each case incurred in the
ordinary course of business (a) for amounts not yet overdue or
(b) for amounts that are overdue and that (in the case of any
such amounts overdue for a period in excess of 5 days) are
being contested in good faith by appropriate proceedings, so
long as (1) such reserves or other
20
CREDIT AGREEMENT
appropriate provisions, if any, as shall be required by GAAP
shall have been made for any such contested amounts, and (2)
in the case of a Lien with respect to any portion of the
Collateral, such contested proceedings conclusively operate
to stay the sale of any portion of the Collateral on account
of such Lien;
(iii) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation,
unemployment insurance and other types of social security, or
to secure the performance of tenders, statutory obligations,
surety and appeal bonds, bids, leases, government contracts,
trade contracts, performance and return-of-money bonds and
other similar obligations (exclusive of obligations for the
payment of borrowed money), so long as no foreclosure, sale or
similar proceedings have been commenced with respect to any
portion of the Collateral on account thereof;
(iv) any attachment or judgment Lien not constituting
an Event of Default under subsection 8.8;
(v) leases or subleases granted to third parties
including without limitation to franchisees in accordance with
any applicable terms of the Collateral Documents and not
interfering in any material respect with the ordinary conduct
of the business of Borrowers or any of their Subsidiaries or
resulting in a material diminution in the value of any
Collateral as security for the Obligations;
(vi) easements, rights-of-way, restrictions,
covenants, encroachments, and other minor defects or
irregularities in title, in each case which do not and will
not interfere in any material respect with the ordinary
conduct of the business of Borrowers or any of their
Subsidiaries or result in a material diminution in the value
of any Collateral as security for the Obligations;
(vii) any (a) restriction or encumbrance that the
interest or title of such lessor or sublessor may be subject
to, or (b) subordination of the interest of the lessee or
sublessee under such lease to any restriction or encumbrance
referred to in the preceding clause (a), so long as the holder
of such restriction or encumbrance agrees to recognize the
rights of such lessee or sublessee under such lease;
(viii) purchase options granted at a price not less
than the fair market value of such property;
(ix) Liens arising from filing UCC financing
statements relating solely to leases permitted by this
Agreement; and
(x) Liens in favor of Borrowers and their
Subsidiaries granted by third parties on the properties and
assets of such third parties.
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CREDIT AGREEMENT
"PERMITTED REINVESTMENT CAPITAL EXPENDITURES" means, with respect to
each Real Property Asset of Borrowers or their Subsidiaries which is subject to
a casualty loss or eminent domain proceeding, the sum of (i) Capital
Expenditures representing the reinvestment of casualty insurance proceeds or
eminent domain proceeds (or proceeds from a sale in lieu thereof), as the case
may be, actually received by the Borrowers or their respective Subsidiaries as a
result of their respective casualty loss or eminent domain proceeding (or sale
in lieu thereof) PLUS, (ii) with respect to each such Real Property Asset, the
lesser of $6,000,000 or the then Available Basket Amount.
"PERSON" means and includes natural persons, corporations, limited
partnerships, general partnerships, limited liability companies, limited
liability partnerships, joint stock companies, Joint Ventures, associations,
companies, trusts, banks, trust companies, land trusts, business trusts or other
organizations, whether or not legal entities, and governments (whether federal,
state or local, domestic or foreign, and including political subdivisions
thereof) and agencies or other administrative or regulatory bodies thereof.
"PLEDGE AGREEMENT" means the Pledge and Security Agreement executed and
delivered by Borrowers and their Subsidiaries on the Closing Date and to be
executed and delivered by additional subsidiaries of Borrower from time to time
thereafter pursuant to subsection 6.8, substantially in the form of EXHIBIT XI
annexed hereto, or such Pledge Agreement may hereafter be amended, supplemented
or otherwise modified from time to time.
"PLEDGED COLLATERAL" means, collectively, the "Pledged Collateral" as
defined in the Pledge Agreement.
"POTENTIAL EVENT OF DEFAULT" means a condition or event that, after
notice or lapse of time or both, would constitute an Event of Default.
"PRO FORMA BASIS" means, as of any date of determination, to the extent
so provided for herein, that the compliance of Borrowers with the financial
covenants set forth in subsection 7.6 as of the last day of the four Fiscal
Quarter period most recently ended prior to such date of determination for which
the relevant financial information is available (the "COMPLIANCE PERIOD"), will
be determined after giving effect on a pro forma basis to any permitted
acquisitions made during such Compliance Period and any permitted dispositions
made during such Compliance Period, other than sales of inventory in the
ordinary course of business and dispositions of obsolete equipment, on the
following basis:
(i) any Indebtedness incurred or assumed by Borrowers
or any of their Subsidiaries and any Indebtedness repaid, each
only in connection with such permitted acquisitions or
dispositions, shall be deemed to have been incurred or repaid,
respectively, as of the first day of the Compliance Period;
for purposes of this clause (i), the aggregate amount of any
such Indebtedness shall be net of Cash and Cash Equivalents in
excess of $5,000,000 held by Borrowers and their Subsidiaries;
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CREDIT AGREEMENT
(ii) if such Indebtedness incurred or assumed by
Borrowers or any of their Subsidiaries has a floating or
formula rate, then the rate of interest for such Indebtedness
in connection with any such permitted acquisition or
disposition for the applicable period shall be computed as if
the rate in effect for such Indebtedness on the relevant
measurement date had been the applicable rate for the entire
applicable period;
(iii) income statement items (whether positive or
negative) attributable to the property or business acquired or
disposed of in such permitted acquisitions or dispositions
shall be included or excluded, as applicable, as if such
acquisitions or dispositions took place on the first day of
such Compliance Period on a pro forma basis; and
(iv) any historical extraordinary non-recurring costs
or expenses or other verifiable costs or expenses that will
not continue after the acquisition or disposition date may be
eliminated and other expenses and cost reductions may be
reflected on a basis consistent with Regulation S-X
promulgated by the Securities and Exchange Commission or as
approved by Administrative Agent.
"PROPERTY LEVEL CASH FLOW" means, for a period of four consecutive
fiscal quarters preceding the date of such determination as it relates to
certain Lodging Assets, the sum of (i) the total revenue generated by or solely
attributable to such Lodging Assets, MINUS (ii) direct expenses, which shall
include expenses such as salaries, payroll taxes and benefits, supplies, repair
and maintenance, utilities, advertising, security, purchased services, vehicle
expenses, travel agency commissions, bad debt, credit card discounts, collection
costs and other inn expenses, MINUS (iii) other direct expenses, which shall
include expenses such as restaurant & club expenses (net), property taxes and
insurance, MINUS (iv) total fees, which shall include fees such as reservation
fees, marketing fees and information technology support fees, MINUS (v) royalty
fees (calculated at 4% of net room revenues), MINUS (vi) the related Capital
Expenditure Reserve.
"PRO RATA SHARE" means (i) with respect to all payments, computations
and other matters relating to the Term Loan Commitment or the Term Loan of any
Lender, the percentage obtained by DIVIDING (x) the Term Loan Exposure of that
Lender BY (y) the aggregate Term Loan Exposure of all Lenders, (ii) with respect
to all payments, computations and other matters relating to the Revolving Loan
Commitment or the Revolving Loans of any Lender or any Letters of Credit issued
or participations therein purchased by any Lender, the percentage obtained by
DIVIDING (x) the Revolving Loan Exposure of that Lender BY (y) the aggregate
Revolving Loan Exposure of all Lenders, and (iii) for all other purposes with
respect to each Lender, the percentage obtained by DIVIDING (x) the sum of the
Term Loan Exposure of that Lender PLUS the Revolving Loan Exposure of that
Lender BY (y) the sum of the aggregate Term Loan Exposure of all Lenders PLUS
the aggregate Revolving Loan Exposure of all Lenders, in any such case as the
applicable percentage may be adjusted by assignments permitted pursuant to
subsection 10.1.
"PROJECTED CLOSING DATE" is defined in subsection 2.1A(i).
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CREDIT AGREEMENT
"REAL PROPERTY ASSET" means, at any time of determination, any interest
then owned by any Loan Party in any real property.
"REFERENCE RATE" means the rate that CIBC announces from time to time
as its prime lending rate, as in effect from time to time. The Reference Rate is
a reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. CIBC or any other Lender may make commercial
loans or other loans at rates of interest at, above or below the Reference Rate.
"REFINANCING" has the meaning assigned to that term in the Recitals to
this Agreement.
"REFINANCING INDEBTEDNESS" has the meaning assigned to that term in
subsection 7.1(v).
"REGULATION D" means Regulation D of the Board of Governors of the
Federal Reserve System, as in effect from time to time.
"REIMBURSEMENT DATE" has the meaning assigned to that term in
subsection 3.3B.
"REIT" means a real estate investment trust as defined under the
Internal Revenue Code.
"RELEASE" means any release, spill, emission, leaking, pumping,
pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping,
leaching or migration of Hazardous Materials into the indoor or outdoor
environment (including the abandonment or disposal of any barrels, containers or
other closed receptacles containing any Hazardous Materials), including the
movement of any Hazardous Materials through the air, soil, surface water or
groundwater.
"REQUIRED REFINANCING LIQUIDITY" means the sum of the amounts described
in clause (y) of any of subparagraph (i), (ii) or (iii) of subsection 2.9A or
clause (y) of any of subparagraph (i) or (ii) of subsection 2.9B, each as and
when applicable.
"REQUIRED REFINANCING LIQUIDITY PERIOD" means the period during which
Borrowers must maintain any Required Refinancing Liquidity in connection with an
extension of the Term Loan Maturity Date and Revolving Loan Commitment
Termination Date, as follows: (i) with respect to the extension in subsections
2.9A(i) and 2.9B(i), the period from the date of the delivery of the Extension
Notice to and including the earlier to occur of September 30, 2003 or the
refinancing of the then outstanding 7.82% Senior Notes Due September 30, 2026;
(ii) with respect to the extension in subsections 2.9A(ii) and 2.9B(ii), the
period from the date of the delivery of the Extension Notice, to and including
the earlier to occur of March 15, 2004 or the refinancing of the then
outstanding 7.25% Senior Notes due March 2004; and (iii) with respect to the
extension in subsection 2.9A(iii), the period from the date of the delivery of
the Extension Notice to and including the earlier to occur of August 15, 2004 or
the refinancing of the then outstanding 7.114% Senior Notes Due August 2011.
24
CREDIT AGREEMENT
"REQUISITE CLASS LENDERS" means, at any time of determination (i) for
the Class of Lenders having Revolving Loan Exposure, Lenders having or holding
more than 50% of the aggregate Revolving Loan Exposure of all Lenders, and (ii)
for the Class of Lenders having Term Loan Exposure, Lenders having or holding
more than 50% of the aggregate Term Loan Exposure of all Lenders.
"REQUISITE LENDERS" means Lenders having or holding more than 50% of
the sum of the aggregate Term Loan Exposure of all Lenders PLUS the aggregate
Revolving Loan Exposure of all Lenders.
"RESTRICTED PAYMENT" means (i) any dividend or other distribution,
direct or indirect, on account of any shares of Borrowers' common stock,
Borrowers' preferred stock, or any other class of stock of Borrowers now or
hereafter outstanding, except a dividend payable solely in shares of that class
of stock to the holders of that class, (ii) any redemption, retirement, sinking
fund or similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of Borrowers' common stock, Borrowers' preferred stock,
or any other class of stock of Borrowers now or hereafter outstanding, (iii) any
payment made to retire, or to obtain the surrender of, any outstanding warrants,
options or other rights to acquire shares of Borrowers' common stock, Borrowers'
preferred stock, or any other class of stock of Borrowers now or hereafter
outstanding, and (iv) any payment or prepayment of principal of, premium, if
any, or interest on, or redemption, purchase, retirement, defeasance (including
in-substance or legal defeasance), sinking fund or similar payment with respect
to any Subordinated Indebtedness.
"RESTRUCTURING CHARGES" means Cash expenses and charges related to the
Conversion and/or the disposition of Healthcare Assets and related business and
operations (x) as incurred and disclosed to Administrative Agent for the period
prior to and including March 31, 2001, and (y) thereafter up to an amount which
does not exceed $30,000,000 in the aggregate.
"REVOLVING LOAN COMMITMENT" means the commitment of a Lender to make
Revolving Loans to Borrowers pursuant to subsection 2.1A(ii), and "REVOLVING
LOAN COMMITMENTS" means such commitments of all Lenders in the aggregate.
"REVOLVING LOAN COMMITMENT TERMINATION DATE" means initially May 31,
2003 unless the Initial Revolving Loan Commitment Termination Date has been
extended in accordance with subsection 2.9B, in which case it means the latest
date to which the Revolving Loan Commitment Termination Date has been extended
under subsection 2.9B.
"REVOLVING LOAN EXPOSURE" means, with respect to any Lender, means, as
of any date of determination (i) prior to the termination of the Revolving Loan
Commitments, that Lender's Revolving Loan Commitment, and (ii) after the
termination of the Revolving Loan Commitments, the sum of (a) the aggregate
outstanding principal amount of the Revolving Loans of that Lender PLUS (b) the
aggregate amount of all participations purchased by that Lender in any
outstanding Letters of Credit or any unreimbursed drawings under any Letters of
Credit.
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CREDIT AGREEMENT
"REVOLVING LOANS" means the Loans made by Lenders to Borrowers pursuant
to subsection 2.1A(ii).
"REVOLVING NOTES" means (i) the promissory notes of Borrowers issued
pursuant to subsection 2.1D(i)(b) on the Closing Date, and (ii) any promissory
notes issued by Borrowers pursuant to the last sentence of subsection 10.1B(i)
in connection with permitted assignments of the Revolving Loan Commitments and
Revolving Loans of any Lenders, in each case substantially in the form of
EXHIBIT V annexed hereto, as they may be amended, supplemented or otherwise
modified from time to time.
"S&P" means Standard & Poor's Ratings Group.
"SECURITIES" means any stock, shares, partnership interests, voting
trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of Indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
"securities" or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
"SECURITIES ACT" means the Securities Act of 1933, as amended from time
to time, and any successor statute.
"SENIOR NOTES" means those notes issued pursuant to (i) the Indenture,
dated as of April 23, 1992, by and between Meditrust and Fleet National Bank,
(ii) the Indenture, dated as of July 26, 1995, by and between Meditrust and
Fleet National Bank, (iii) the First Supplemental Indenture, dated as of July
26, 1995, by and between Meditrust and Fleet National Bank, to the Indenture
dated as of July 26, 1995, (iv) the Second Supplemental Indenture, dated as of
July 28, 1995, by and between Meditrust and Fleet National Bank, to the
Indenture dated as of July 26, 1995, (v) the Third Supplemental Indenture, dated
as of August 10, 1995, by and between Meditrust and Fleet National Bank, to the
Indenture dated as of July 26, 1995, (vi) the Fourth Supplemental Indenture,
dated as of September 10, 1996, by and between Meditrust and Fleet National
Bank, to the Indenture dated as of July 26, 1995, (vii) the Fifth Supplemental
Indenture, dated as of August 12, 1997, by and between Meditrust and Fleet
National Bank, to the Indenture dated as of July 26, 1995, (viii) the Sixth
Supplemental Indenture, dated as of August 12, 1997, by and between Meditrust
and State Street Bank and Trust Company (as Successor Trustee to Fleet National
Bank), to the Indenture dated as of July 26, 1995, (ix) the Seventh Supplemental
Indenture, dated as of August 12, 1997, by and between Meditrust and State
Street Bank and Trust Company (as Successor Trustee to Fleet National Bank), to
the Indenture dated as of July 26, 1995, and (x) the Indenture, dated as of
September 15, 1995, by and between La Quinta Inns, Inc. (predecessor-in-interest
to Meditrust) and U.S. Trust Company of Texas, N.A.
"SENIOR NOTE DOCUMENTS" means the Senior Notes, the Indentures
referenced in clauses (i), (ii) and (x) of the definition of Senior Notes and
all supplements to such Indentures.
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CREDIT AGREEMENT
"SOLVENT" means, with respect to any Person, that as of the date of
determination both (A) (i) the then fair saleable value of the property and
assets of such Person is (y) greater than the total amount of liabilities
(including contingent liabilities) of such Person and (z) not less than the
amount that will be required to pay the probable liabilities on such Person's
then existing debts as they become absolute and matured considering all
financing alternatives and potential asset sales reasonably available to such
Person; (ii) such Person's capital is not unreasonably small in relation to its
business or any contemplated or undertaken transaction; and (iii) such Person
does not intend to incur, or believe (nor should it reasonably believe) that it
will incur, debts beyond its ability to pay such debts as they become due; and
(B) such Person is "solvent" within the meaning given that term and similar
terms under applicable laws relating to fraudulent transfers and conveyances.
For purposes of this definition, the amount of any contingent liability at any
time shall be computed as the amount that, in light of all of the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability.
"SUBORDINATED INDEBTEDNESS" means any unsecured Indebtedness of
Borrowers and their Subsidiaries subordinated in right of payment to the
Obligations which Indebtedness shall not mature or be mandatorily redeemable
earlier than six months after the final maturity of the Term Loans, shall not
provide for any amortization or sinking fund payments and which shall be issued
pursuant to documentation containing covenants, defaults, remedies and
subordination provisions reasonably satisfactory to Administrative Agent.
"SUBSIDIARY" means, with respect to any Person, (a) any corporation,
partnership, limited liability company, association, joint venture or other
business entity of which more than 50% of the total voting power of shares of
stock or other ownership interests entitled (without regard to the occurrence of
any contingency) to vote in the election of the Person or Persons (whether
directors, managers, trustees or other Persons performing similar functions)
having the power to direct or cause the direction of the management and policies
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination
thereof or (b) any other Person consolidated with such Person in conformity with
GAAP.
"SUBSIDIARY GUARANTOR" means any Subsidiary of Borrowers that executes
and delivers a counterpart of the Subsidiary Guaranty on the Closing Date or
from time to time thereafter pursuant to subsection 6.8.
"SUBSIDIARY GUARANTY" means the Subsidiary Guaranty executed and
delivered by existing Subsidiaries of Borrowers on the Closing Date and to be
executed and delivered by additional Subsidiaries of Borrowers from time to time
thereafter in accordance with subsection 6.8, substantially in the form of
EXHIBIT XII annexed hereto, as such Subsidiary Guaranty may hereafter be
amended, supplemented or otherwise modified from time to time.
"SUPPLEMENTAL COLLATERAL AGENT" has the meaning assigned to that term
in subsection 9.1B.
"SYNDICATION AGENT" has the meaning assigned to that term in the
recitals.
27
CREDIT AGREEMENT
"TAX" or "TAXES" means any present or future tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature and whatever called, by
whomsoever, on whomsoever and wherever imposed, levied, collected, withheld or
assessed, including interest, penalties, additions to tax and any similar
liabilities with respect thereto; except that, in the case of a Lender, there
shall be excluded (1) taxes that are imposed on the overall net income or net
profits (including franchise taxes imposed in lieu thereof) (i) by the United
States, (ii) by any other government authority under the laws of which the
Lender is organized or has its principal office or maintains its applicable
lending office, or (iii) by any jurisdiction solely as a result of a present or
former connection between the Lender (other than any such connection arising
solely from the Lender having executed, delivered or performed its obligations
or received a payment under, or enforced any of the Loan Documents), and (2) any
branch profits taxes imposed by the United States or any similar tax imposed by
any other jurisdiction in which the Lender is located.
"TERM LOAN COMMITMENT" means the commitment of a Lender to make a Term
Loan to Borrowers pursuant to subsection 2.1A(i), and "TERM LOAN COMMITMENTS"
means such commitments of all Lenders in the aggregate.
"TERM LOAN EXPOSURE" means, with respect to any Lender as of any date
of determination (i) prior to the funding of the Term Loan, that Lender's Term
Loan Commitment and (ii) after the funding of the Term Loan, the outstanding
principal amount of the Term Loan of that Lender.
"TERM LOAN" means the Loans made by Lenders to Borrowers pursuant to
subsection 2.1A(i).
"TERM LOAN MATURITY DATE" means, initially May 31, 2003 unless the
initial Term Loan Maturity Date has been extended in accordance with subsection
2.9A, in which case it means the latest date to which the Term Loan Maturity
Date has been extended under subsection 2.9A.
"TERM LOAN NOTES" means (i) the promissory notes of Borrowers issued
pursuant to subsection 2.1D(i)(a) on the Closing Date, and (ii) any promissory
notes issued by Borrowers pursuant to the last sentence of subsection 10.1B(i)
in connection with permitted assignments of the Term Loan Commitments or Term
Loan of any Lenders, in each case substantially in the form of EXHIBIT IV
annexed hereto, as they may be amended, supplemented or otherwise modified from
time to time.
"TOTAL CAPITALIZATION" means Total Debt PLUS Consolidated Tangible Net
Worth.
"TOTAL DEBT" means, as at any date of determination and without
duplication, the sum of (a) the aggregate amount of all Indebtedness of
Borrowers and their Subsidiaries MINUS (b) the amount of Borrowers' and their
Subsidiaries' Cash and Cash Equivalents in excess of $5,000,000.
"TOTAL LEVERAGE RATIO" means, as at the last day of any Fiscal Quarter,
the ratio of (a) Total Debt as of the last day of such Fiscal Quarter to (b)
Consolidated EBITDA for the four Fiscal Quarter period then ended.
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CREDIT AGREEMENT
"TOTAL UTILIZATION OF REVOLVING LOAN COMMITMENTS" means, as at any date
of determination, the sum of (i) the aggregate principal amount of all
outstanding Revolving Loans (other than Revolving Loans made for the purpose of
reimbursing the applicable Issuing Lender for any amount drawn under any Letter
of Credit but not yet so applied) PLUS (ii) the Letter of Credit Usage.
"TRANSACTION COSTS" means the fees, costs and expenses payable by
Borrowers on or before the Closing Date in connection with the transactions
contemplated by the Loan Documents.
"TYPE" means, with respect to any Loan, a Term Loan or a Revolving Loan
(each of which is a "TYPE" of Loan).
"UCC" means the Uniform Commercial Code (or any similar or equivalent
legislation) as in effect in any applicable jurisdiction.
1.2 ACCOUNTING TERMS; UTILIZATION OF GAAP FOR PURPOSES OF CALCULATIONS UNDER
AGREEMENT.
Except as otherwise expressly provided in this Agreement, all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. Financial statements and other information
required to be delivered by Borrowers to Administrative Agent pursuant to
clauses (i), (ii), (iii) and (x) of subsection 6.1 shall be prepared in
accordance with GAAP as in effect at the time of such preparation (and delivered
together with the reconciliation statements provided for in subsection 6.1(v)).
Calculations in connection with the definitions, covenants and other provisions
of this Agreement shall utilize GAAP as in effect on the date of determination,
applied in a manner consistent with that used in preparing the financial
statements referred to in subsection 5.3. If at any time any change in GAAP
would affect the computation of any financial ratio or requirement set forth in
any Loan Document, and Borrowers, Administrative Agent or Requisite Lenders
shall so request, Administrative Agent, Lenders and Borrowers shall negotiate in
good faith to amend such ratio or requirement to preserve the original intent
thereof in light of such change in GAAP (subject to the approval of Requisite
Lenders), PROVIDED that, until so amended, such ratio or requirement shall
continue to be computed in accordance with GAAP prior to such change therein and
Borrowers shall provide to Administrative Agent reconciliation statements
provided for in subsection 6.1(v).
1.3 OTHER DEFINITIONAL PROVISIONS AND RULES OF CONSTRUCTION.
A. Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference.
B. References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise specifically
provided.
C. The use in any of the Loan Documents of the word "include" or
"including", when following any general statement, term or matter, shall not be
construed to limit such statement, term or matter to the specific items or
matters set forth immediately following
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CREDIT AGREEMENT
such word or to similar items or matters, whether or not nonlimiting language
(such as "without limitation" or "but not limited to" or words of similar
import) is used with reference thereto, but rather shall be deemed to refer to
all other items or matters that fall within the broadest possible scope of such
general statement, term or matter.
D. Each of the parties hereto acknowledges that (i) it has been
represented by counsel in the negotiation and documentation of the terms of this
Agreement, (ii) it has had full and fair opportunity to review and revise the
terms of this Agreement, (iii) this Agreement has been drafted jointly by all of
the parties hereto, and (iv) neither Administrative Agent nor any Lender has any
fiduciary relationship with or duty to Borrowers arising out of or in connection
with this Agreement or any of the other Loan Documents, and the relationship
between Administrative Agent and Lenders, on one hand, and Borrowers, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor. Accordingly, each of the parties hereto acknowledges and agrees that
the terms of this Agreement shall not be construed against or in favor of
another party.
E. (i) Any reference in this Agreement or any other Loan Document to
any agreement means such agreement as it may be amended, supplemented or
otherwise modified from time to time; (ii) any reference in this Agreement or
any other Loan Document to any law, statute, regulation, rule or other
legislative action shall mean such law, statute, regulation, rule or other
legislative action as amended, supplemented or otherwise modified from time to
time, and shall include any rule or regulation promulgated thereunder; and (iii)
any reference in this Agreement or any other Loan Document to a Person shall
include the successor or assignee of such Person.
SECTION 2. AMOUNTS AND TERMS OF COMMITMENTS AND LOANS
2.1 COMMITMENTS; MAKING OF LOANS; OPTIONAL NOTES.
A. COMMITMENTS. Subject to the terms and conditions of this Agreement
and in reliance upon the representations and warranties of Borrowers herein set
forth, each Lender hereby severally agrees to make the Loans described in
subsections 2.1A(i) and 2.1A(ii):
(i) TERM LOAN. Borrowers shall deliver to Administrative Agent a
Notice of Borrowing no later than 12:00 Noon (New York City time) at
least one Business Day prior to the Closing Date, requesting a
borrowing of the Term Loan. The Notice of Borrowing shall specify (i)
the proposed Funding Date (which shall be a Business Day), and (ii)
that such Loans shall be Base Rate Loans; PROVIDED that
notwithstanding the foregoing, Borrowers may request that all or any
portion of such Loans may be LIBOR Loans if (x) a Notice of Borrowing
is delivered at least three Business Days' prior to a specified
Closing Date (the "PROJECTED CLOSING DATE") and (y) concurrently
therewith Borrowers agree in writing in a manner satisfactory to
Administrative Agent to indemnify, defend and hold harmless
Administrative Agent and the Lenders from and against any losses,
expenses or liabilities, including without limitation, the losses,
expenses and liabilities described in subsection 2.6D, in the event
such LIBOR Loans are not funded on the Projected Closing Date for any
reason whatsoever including the failure to satisfy any of the
conditions in Section 4.
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CREDIT AGREEMENT
Each Lender severally agrees to lend to Borrowers on the Closing Date
an amount not exceeding its Pro Rata Share of the aggregate amount of
the Term Loan Commitments to be used for the purposes identified in
subsection 2.5A. The amount of each Lender's Term Loan Commitment is
set forth in its Allocation Letter and the aggregate amount of the
Term Loan Commitments is $150,000,000; PROVIDED that the Term Loan
Commitments of Lenders shall be adjusted to give effect to any
permitted assignments of the Term Loan Commitments pursuant to
subsection 10.1B; and PROVIDED, FURTHER, that the Term Loan
Commitments of Lenders shall be adjusted to give effect to any
increase of the Term Loan Commitment pursuant to subsection 2.1A(iii).
Borrowers may make only one borrowing under the Term Loan Commitments.
Amounts borrowed under this subsection 2.1A(i) and subsequently repaid
or prepaid may not be reborrowed.
(ii) REVOLVING LOANS. Each Lender severally agrees, subject to
the limitations set forth below with respect to the maximum amount of
Revolving Loans permitted to be outstanding from time to time, to lend
to Borrowers from time to time during the period from the Closing Date
to but excluding the Revolving Loan Commitment Termination Date an
aggregate amount not exceeding its Pro Rata Share of the aggregate
amount of the Revolving Loan Commitments to be used for the purposes
identified in subsection 2.5B. The original amount of each Lender's
Revolving Loan Commitment is set forth in its Allocation Letter and
the aggregate original amount of the Revolving Loan Commitments is
$200,000,000; PROVIDED that the Revolving Loan Commitments of Lenders
shall be adjusted to give effect to any permitted assignments of the
Revolving Loan Commitments pursuant to subsection 10.1B; PROVIDED,
that the Revolving Loan Commitments of Lenders shall be adjusted to
give effect to any increase of the Revolving Loan Commitment pursuant
to subsection 2.1A(iii); and PROVIDED, FURTHER, that the amount of the
Revolving Loan Commitments shall be reduced from time to time by the
amount of any reductions thereto made pursuant to subsection 2.4B.
Each Lender's Revolving Loan Commitment shall expire on the Revolving
Loan Commitment Termination Date and all Revolving Loans and all other
amounts owed hereunder with respect to the Revolving Loans and the
Revolving Loan Commitments shall be paid in full no later than that
date. Amounts borrowed under this subsection 2.1A(ii) may be repaid
and reborrowed to but excluding the Revolving Loan Commitment
Termination Date.
In no event shall the Total Utilization of Revolving Loan
Commitments at any time (i) exceed the Revolving Loan Commitments then
in effect, (ii) result in, at the time of such borrowing (unless
Borrowers have certified to Administrative Agent at the time of such
borrowing that the proceeds of such Loans will be used for an
identified purpose which will result in, within five Business Days,
Cash and Cash Equivalents being equal to or less than $35,000,000) or
within five Business Days thereafter, the sum of Cash and Cash
Equivalents of Borrowers and their Subsidiaries being in excess of
$35,000,000, or (iii) but only during the applicable Required
Refinancing Liquidity Period, result in Liquidity being less than any
applicable Required Refinancing Liquidity.
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CREDIT AGREEMENT
(iii) INCREASES OF THE TERM LOAN OR REVOLVING LOAN COMMITMENTS.
With the consent of the Co-Lead Arrangers, Borrowers may, on or at any
time after the Closing Date, increase, at the Borrowers' and Co-Lead
Arrangers' mutual discretion (x) the then effective aggregate
principal amount of the Term Loan and/or (y) the then effective
aggregate principal amount of Revolving Loan Commitments; PROVIDED
that (1) the aggregate principal amount of the increases in the Term
Loan and/or Revolving Loan Commitments pursuant to this subsection
2.1A(iii) shall not exceed $75,000,000, (2) Borrowers shall execute
and deliver such documents and instruments and take such other actions
as may be reasonably requested by Administrative Agent in connection
with such increases and at the time of any such proposed increase, no
Potential Event of Default or Event of Default shall have occurred and
be continuing or would occur after giving effect to such increase. Any
request under this subsection 2.1A(iii) shall be submitted by
Borrowers to Administrative Agent (which shall promptly forward copies
to Lenders). Borrowers may also specify any fees offered to those
Lenders (the "INCREASING LENDERS") which agree to increase the
principal amount of their applicable Term Loan or Revolving Loan
Commitments, as the case may be, which fees may be variable based upon
the amount by which any such Lender is willing to increase the
principal amount of its applicable Term Loan or Revolving Loan
Commitment, as the case may be. No Lender shall have any obligation,
express or implied, to offer to increase the aggregate principal
amount of its applicable Term Loan or Revolving Loan Commitment, as
the case may be. Only the consent of each Increasing Lender shall be
required for an increase in the aggregate principal amount of the
applicable Term Loan or Revolving Loan Commitments, as the case may
be, pursuant to this subsection 2.1A(iii). No Lender which declines to
increase the principal amount of its Term Loan or Revolving Loan
Commitment, as the case may be, may be replaced in respect to its
existing applicable Term Loan or Revolving Loan Commitment, as the
case may be, as a result thereof without such Lender's consent.
Each Increasing Lender shall as soon as practicable specify the
amount of the proposed increase which it is willing to assume.
Borrowers may accept some or all of the offered amounts or designate
new lenders who qualify as Eligible Assignees and which are reasonably
acceptable to Administrative Agent as additional Lenders hereunder in
accordance with this subsection 2.1A(iii) (each such new lender being
a "NEW LENDER"), which New Lender may assume all or a portion of the
increase in the aggregate principal amount of the applicable Term Loan
or Revolving Loan Commitments, as the case may be. Borrowers and
Administrative Agent shall have discretion jointly to adjust the
allocation of the increased aggregate principal amount of the
applicable Term Loan or Revolving Loan Commitments, as the case may
be, among Increasing Lenders and New Lenders.
Each New Lender designated by Borrowers and reasonably acceptable
to Administrative Agent shall become an additional party hereto as a
New Lender concurrently with the effectiveness of the proposed
increase in the aggregate principal amount of the new applicable Term
Loan or Revolving Loan Commitments, as the case may be, upon its
execution of an instrument of joinder, substantially in the form
attached hereto as EXHIBIT XIII.
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CREDIT AGREEMENT
Subject to the foregoing, any increase required by Borrowers
shall be effective as of the date the foregoing actions have been
completed and shall be in the principal amount equal to (i) the
principal amount which Increasing Lenders are willing to assume as
increases to the principal amount of their applicable Term Loan or
Revolving Loan Commitments, as the case may be, PLUS (ii) the principal
amount offered by New Lenders with respect to the applicable Term Loan
or Revolving Loan Commitments, as the case may be, in either case as
adjusted by Borrowers and Administrative Agent pursuant to this
subsection 2.1A(iii). Upon effectiveness of any such increase, the
Commitments and Pro Rata Share of each Lender will be adjusted to give
effect to the increase in the applicable Term Loan or Revolving Loan
Commitments, as the case may be. To the extent that the adjustment of
Pro Rata Shares results in losses or expenses to any Lender as a result
of the prepayment of any LIBOR Loan on a date other than the scheduled
last day of the applicable Interest Period, Borrowers shall be
responsible for such losses or expenses pursuant to subsection 2.6D.
B. BORROWING MECHANICS. Except for Revolving Loans made on the Closing
Date, Revolving Loans made on any Funding Date shall be in an aggregate minimum
amount of $1,000,000 and integral multiples of $100,000 in excess of that
amount. Whenever Borrowers desire that Lenders make Revolving Loans, they shall
deliver a Notice of Borrowing to Administrative Agent no later than 1:00 P.M.
(New York City time) at least three Business Days in advance of the proposed
Funding Date (in the case of a LIBOR Loan) or at least one Business Day in
advance of the proposed Funding Date (in the case of a Base Rate Loan). The
Notice of Borrowing shall specify (i) the proposed Funding Date (which shall be
a Business Day), (ii) the amount and Type of Loans requested, (iii) in the case
of Revolving Loans not made on the Closing Date, whether such Loans shall be
Base Rate Loans or LIBOR Loans, (iv) in the case of any Loans requested to be
made as LIBOR Loans, the initial Interest Period requested therefore, and (v)
information about the account of Borrowers to be credited. Revolving Loans may
be continued as or converted into Base Rate Loans and LIBOR Loans in the manner
provided in subsection 2.2D. In lieu of delivering the above-described Notice of
Borrowing, Borrowers may give Administrative Agent telephonic notice by the
required time of any proposed borrowing under this subsection 2.1B; PROVIDED
that such notice shall be promptly confirmed in writing by delivery of a Notice
of Borrowing to Administrative Agent on the date such notice was given.
Neither Administrative Agent nor any Lender shall incur any liability
to Borrowers in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to borrow on behalf of Borrowers
or for otherwise acting in good faith under this subsection 2.1B, and upon
funding of Revolving Loans by Lenders in accordance with this Agreement pursuant
to any such telephonic notice Borrowers shall have effected Revolving Loans
hereunder.
Borrowers shall notify Administrative Agent prior to the funding of any
Revolving Loans in the event that any of the matters to which Borrowers are
required to certify in the applicable Notice of Borrowing is no longer true and
correct as of the applicable Funding
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CREDIT AGREEMENT
Date, and the acceptance by Borrowers of the proceeds of any Revolving Loans
shall constitute a re-certification by Borrowers, as of the applicable Funding
Date, as to the matters to which Borrowers are required to certify in the
applicable Notice of Borrowing.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
Notice of Borrowing for a LIBOR Loan (or telephonic notice in lieu thereof)
shall be irrevocable once Administrative Agent receives such notice, and
Borrowers shall be bound to make a borrowing in accordance therewith.
C. DISBURSEMENT OF FUNDS. All Term Loan and Revolving Loans under this
Agreement shall be made by Lenders simultaneously and proportionately to their
respective Pro Rata Shares, it being understood that neither Administrative
Agent nor any Lender shall be responsible for any default by any other Lender in
that other Lender's obligation to make a Loan requested hereunder nor shall the
Commitment of any Lender to make the particular Type of Loan requested be
increased or decreased as a result of a default by any other Lender in that
other Lender's obligation to make a Loan requested hereunder. Promptly after
receipt by Administrative Agent of a Notice of Borrowing pursuant to subsection
2.1B (or telephonic notice in lieu thereof) but not later than three Business
Days prior to the Funding Date of a LIBOR Loan and one Business Day prior to the
Funding Date of a Base Rate Loan, Administrative Agent shall notify each Lender
of the proposed borrowing. Each Lender shall make the amount of its Loan
available to Administrative Agent not later than 12:00 Noon (New York City time)
on the applicable Funding Date in same day funds in Dollars, at the
Administrative Agent's Office. Except as provided in subsection 3.3B with
respect to Revolving Loans used to reimburse any Issuing Lender for the amount
of a drawing under a Letter of Credit issued by it, upon satisfaction or waiver
of the conditions precedent specified in subsections 4.1 (in the case of Loans
made on the Closing Date) and 4.2 (in the case of all Loans), Administrative
Agent shall make the proceeds of such Loans available to Borrowers on the
applicable Funding Date by causing an amount of same day funds in Dollars equal
to the proceeds of all such Loans received by Administrative Agent from Lenders
to be credited to an account of Borrowers as specified in the applicable Notice
of Borrowing.
Unless Administrative Agent shall have been notified by any Lender
prior to the Funding Date for any Loans that such Lender does not intend to make
available to Administrative Agent the amount of such Lender's Loan requested on
such Funding Date, Administrative Agent may assume that such Lender has made
such amount available to Administrative Agent on such Funding Date and
Administrative Agent may, in its sole discretion, but shall not be obligated to,
make available to Borrowers a corresponding amount on such Funding Date. If such
corresponding amount is not in fact made available to Administrative Agent by
such Lender, Administrative Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest thereon,
for each day from such Funding Date until the date such amount is paid to
Administrative Agent, at the customary rate set by Administrative Agent for the
correction of errors among banks for three Business Days and thereafter at the
Base Rate. If such Lender does not pay such corresponding amount forthwith upon
Administrative Agent's demand therefor, Administrative Agent shall promptly
notify Borrowers and Borrowers shall immediately pay such corresponding amount
to Administrative Agent together with interest thereon, for each
34
CREDIT AGREEMENT
day from such Funding Date until the date such amount is paid to Administrative
Agent, at the rate payable under this Agreement for Base Rate Loans. Nothing in
this subsection 2.1C shall be deemed to relieve any Lender from its obligation
to fulfill its Commitments hereunder or to prejudice any rights that Borrowers
may have against any Lender as a result of any default by such Lender hereunder.
D. NOTES. Borrowers shall execute and deliver on the Closing Date (i)
to each Term Loan Lender, a Term Loan Note substantially in the form of EXHIBIT
IV annexed hereto to evidence that Lender's Term Loan, in the principal amount
of that Lender's Term Loan and with other appropriate insertions, and (ii) to
each Revolving Loan Lender, a Revolving Note substantially in the form of
EXHIBIT V annexed hereto to evidence that Lender's Revolving Loans, in the
principal amount of that Lender's Revolving Loan Commitment and with other
appropriate insertions.
Administrative Agent may deem and treat the payee of any Note as the
owner thereof for all purposes hereof unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted by
Administrative Agent as provided in subsection 10.1B(ii). Any request,
authorization or consent of any Person who, at the time of making such request
or giving such authority or consent, is the holder of any Note shall be
conclusive and binding on any subsequent holder, assignee or transferee of that
Note or of any Note or Notes issued in exchange therefor.
E. THE REGISTER.
(i) Administrative Agent shall maintain, at its address referred
to in subsection 10.8, a copy of each Assignment Agreement delivered
to it from time to time in accordance with the provisions of
subsection 10.1B and a register for the recordation of the names and
addresses of Lenders and the Commitments and Loans of each Lender from
time to time (the "REGISTER"). The Register shall be available for
inspection by Borrowers and Syndication Agent at any reasonable time
and from time to time upon reasonable prior notice.
(ii) Administrative Agent shall record in the Register the Term
Loan Commitment and Revolving Loan Commitment and the Term Loan and
Revolving Loans from time to time of each Lender and each repayment or
prepayment in respect of the principal amount of the Term Loan or
Revolving Loans of each Lender. Any such recordation shall be
conclusive and binding on Borrowers and each Lender, absent manifest
error; provided that failure to make any such recordation, or any
error in such recordation, shall not affect any Lender's Commitments
or Borrowers' Obligations in respect of any applicable Loans.
(iii) Each Lender shall record on its internal records (including
the Notes held by such Lender) the amount of the Term Loan and each
Revolving Loan made by it and each payment in respect thereof. Any
such recordation shall be conclusive and binding on Borrowers, absent
manifest error; PROVIDED that failure to make any such recordation, or
any error in such recordation, shall not affect any Lender's
Commitments or Borrowers' Obligations in respect of any applicable
Loans; and
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CREDIT AGREEMENT
PROVIDED FURTHER that in the event of any inconsistency between the
Register and any Lender's records, the recordations in the Register
shall govern.
(iv) Borrowers, Administrative Agent and Lenders shall deem and
treat the Persons listed as Lenders in the Register as the holders and
owners of the corresponding Commitments and Loans listed therein for
all purposes hereof, and no assignment or transfer of any such
Commitment or Loan shall be effective, in each case unless and until
an Assignment Agreement effecting the assignment or transfer thereof
shall have been accepted by Administrative Agent and recorded in the
Register as provided in subsection 10.1B(ii). Prior to such
recordation, all amounts owed with respect to the applicable
Commitment or Loan shall be owed to the Lender listed in the Register
as the owner thereof, and any request, authority or consent of any
Person who, at the time of making such request or giving such
authority or consent, is listed in the Register as a Lender shall be
conclusive and binding on any subsequent holder, assignee or
transferee of the corresponding Commitments or Loans.
(v) Borrowers hereby designates CIBC to serve as Borrower's agent
solely for purposes of maintaining the Register as provided in this
subsection 2.1E, and Borrowers hereby agree that, to the extent CIBC
serves in such capacity, CIBC and its officers, directors, employees,
agents and Affiliates shall constitute Indemnitees for all purposes
under subsection 10.3.
2.2 INTEREST ON THE LOANS.
A. RATE OF INTEREST. Subject to the provisions of subsections 2.2F, 2.6
and 2.7, each Term Loan and each Revolving Loan shall bear interest on the
unpaid principal amount thereof from the date made through maturity (whether by
acceleration or otherwise) or earlier repayment at a rate determined by
reference to the Base Rate or the Adjusted LIBOR. The applicable basis for
determining the rate of interest with respect to any Term Loan or any Revolving
Loan shall be selected by Borrowers initially at the time a Notice of Borrowing
is given with respect to such Loan pursuant to subsection 2.1B, and the basis
for determining the interest rate with respect to any Term Loan or any Revolving
Loan may be changed from time to time pursuant to subsection 2.2D. If on any day
a Term Loan or Revolving Loan is outstanding with respect to which notice has
not been delivered to Administrative Agent in accordance with the terms of this
Agreement specifying the applicable basis for determining the rate of interest,
then for that day that Loan shall bear interest determined by reference to the
Base Rate.
Subject to the provisions of subsections 2.2E, 2.2F and 2.7, the Term
Loan and the Revolving Loans shall bear interest through maturity or earlier
repayment as follows:
(i) if a Base Rate Loan, then at the sum of the Base Rate PLUS
the Applicable Base Rate Margin for such class of Loans; or
(ii) if a LIBOR Loan, then at the sum of the Adjusted LIBOR PLUS
the Applicable LIBOR Margin for such class of Loans.
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CREDIT AGREEMENT
Upon delivery of the Margin Determination Certificate by Borrowers to
Administrative Agent pursuant to subsection 6.1(xv), the Applicable Base Rate
Margin and Applicable LIBOR Margin shall automatically be adjusted in accordance
with such Margin Determination Certificate, such adjustment to become effective
on the third Business Day after such Margin Determination Certificate is
delivered to Administrative Agent; PROVIDED that (1) at any time a Margin
Determination Certificate is not delivered at the time required pursuant to
subsection 6.1(xv), from the time such Margin Determination Certificate was
required to be delivered until delivery of such Margin Determination
Certificate, the Applicable Base Rate Margin shall be 2.00% for the Revolving
Loans, and the Applicable LIBOR Margin shall be 3.50% for the Revolving Loans,
and (2) if a Margin Determination Certificate erroneously indicates an
applicable margin more favorable to Borrowers than should be afforded by the
actual calculation of the Total Leverage Ratio, Borrowers shall promptly pay
additional interest and letter of credit fees to correct for such error.
B. INTEREST PERIODS. In connection with each LIBOR Loan, Borrowers may,
pursuant to the applicable Notice of Borrowing or Notice of
Conversion/Continuation, as the case may be, select an interest period (each an
"INTEREST PERIOD") to be applicable to such Loan, which Interest Period shall
be, at Borrower's option, either a one, two, three or six month period; PROVIDED
that:
(i) the initial Interest Period for any LIBOR Loan shall commence
on the Funding Date in respect of such Loan, in the case of a Loan
initially made as a LIBOR Loan, or on the date specified in the
applicable Notice of Conversion/Continuation, in the case of a Loan
converted to a LIBOR Loan;
(ii) in the case of immediately successive Interest Periods
applicable to a LIBOR Loan continued as such pursuant to a Notice of
Conversion/Continuation, each successive Interest Period shall
commence on the day on which the next preceding Interest Period
expires;
(iii) if an Interest Period would otherwise expire on a day that
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; PROVIDED that, if any Interest Period would
otherwise expire on a day that is not a Business Day but is a day of
the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day;
(iv) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall, subject to clause (v) of this subsection 2.2B, end on
the last Business Day of a calendar month;
(v) no Interest Period with respect to any portion of the Term
Loan shall extend beyond the then effective Term Loan Maturity Date
and no Interest Period with respect to any portion of the Revolving
Loans shall extend beyond the then effective Revolving Loan Commitment
Termination Date;
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CREDIT AGREEMENT
(vi) there shall be no more than fifteen Interest Periods
outstanding at any time; and
(vii) in the event Borrowers fails to specify an Interest Period
for any LIBOR Loan in the applicable Notice of Borrowing or Notice of
Conversion/Continuation, Borrowers shall be deemed to have selected an
Interest Period of one month.
C. INTEREST PAYMENTS. Subject to the provisions of subsection 2.2E and
2.2F, interest on each Loan shall be payable in arrears on and to each Interest
Payment Date applicable to that Loan, upon any prepayment of that Loan (to the
extent accrued on the amount being prepaid) and at maturity (including final
maturity); provided that in the event any Loans that are Base Rate Loans are
prepaid pursuant to subsection 2.4B(i), interest accrued on such Loans through
the date of such prepayment shall be payable on the next succeeding Interest
Payment Date applicable to Base Rate Loans (or, if earlier, at final maturity).
D. CONVERSION OR CONTINUATION. Subject to the provisions of subsection
2.6, Borrowers shall have the option (i) to convert at any time all or any part
of its outstanding Term Loan or Revolving Loans equal to $1,000,000 and integral
multiples of $100,000 in excess of that amount from Loans bearing interest at a
rate determined by reference to one basis to Loans bearing interest at a rate
determined by reference to an alternative basis or (ii) upon the expiration of
any Interest Period applicable to a LIBOR Loan, to continue all or any portion
of such Loan equal to $1,000,000 and integral multiples of $100,000 in excess of
that amount as a LIBOR Loan; PROVIDED, HOWEVER, that a LIBOR Loan may only be
converted into a Base Rate Loan on the expiration date of an Interest Period
applicable thereto.
Borrowers shall deliver a Notice of Conversion/Continuation to
Administrative Agent no later than 1:00 P.M. (New York City time) at least three
Business Days in advance of the proposed conversion date (in the case of a
conversion to a Base Rate Loan) and at least three Business Days in advance of
the proposed conversion/continuation date (in the case of a conversion to, or a
continuation of, a LIBOR Loan). With respect to any Base Rate or LIBOR Loan, if
Borrowers fail to deliver a Notice of Conversion/Continuation as described above
or if any proposed conversion/continuation under this subsection 2.2D is not
permitted hereunder, Borrowers shall be deemed to have elected to convert such
LIBOR Loan to a Base Rate Loan on the last day of the then-expiring Interest
Period and to continue any such Base Rate Loan as a Base Rate Loan, as
applicable.
A Notice of Conversion/Continuation shall specify (i) the proposed
conversion/continuation date (which shall be a Business Day), (ii) the amount
and Type of the Loan to be converted/continued, (iii) the nature of the proposed
conversion/continuation, (iv) in the case of a conversion to, or a continuation
of, a LIBOR Loan, the requested Interest Period, and (v) in the case of a
conversion to, or a continuation of, a LIBOR Loan, that no Event of Default has
occurred and is continuing. In lieu of delivering the above-described Notice of
Conversion/Continuation, Borrowers may give Administrative Agent telephonic
notice by the required time of any proposed conversion/continuation under this
subsection
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CREDIT AGREEMENT
2.2D, provided that Administrative Agent shall receive a Notice of
Conversion/Continuation to confirm such telephonic notice no later than 1:00
P.M. (New York City time) on the day on which such telephonic notice is given.
Upon receipt of written or telephonic notice of any proposed
conversion/continuation under this subsection 2.2D, Administrative Agent shall
promptly transmit such notice by telefacsimile or telephone to each Lender but
not later than two Business Days prior to the Funding Date of a LIBOR Loan and
one Business Day prior to the Funding Date of a Base Rate Loan.
Neither Administrative Agent nor any Lender shall incur any liability
to Borrowers in acting upon any telephonic notice referred to above that
Administrative Agent believes in good faith to have been given by a duly
authorized officer or other person authorized to act on behalf of Borrowers or
for otherwise acting in good faith under this subsection 2.2D, and upon
conversion or continuation of the applicable basis for determining the interest
rate with respect to any Loans in accordance with this Agreement pursuant to any
such telephonic notice Borrowers shall have effected a conversion or
continuation, as the case may be, hereunder.
Except as otherwise provided in subsections 2.6B, 2.6C and 2.6G, a
notice of a proposed conversion to, or continuation of, a LIBOR Loan (whether by
delivery of a Notice of Conversion/Continuation or telephonic notice) shall be
irrevocable once Administrative Agent receives such notice, and Borrowers shall
be bound to effect a conversion or continuation in accordance therewith.
E. DEFAULT RATE. Upon the occurrence and during the continuation of any
Event of Default, the outstanding principal amount of all Loans and, to the
extent permitted by applicable law, any interest payments thereon not paid when
due and any fees and other amounts then due and payable hereunder, shall
thereafter bear interest (including post-petition interest in any proceeding
under the Bankruptcy Code or other applicable bankruptcy laws) payable upon
demand at a rate that is 2.00% per annum in excess of the interest rate
otherwise payable under this Agreement with respect to the applicable Loans (or,
in the case of any such fees and other amounts, at a rate which is 2.00% per
annum in excess of the interest rate otherwise payable under this Agreement for
Base Rate Loans); PROVIDED that, in the case of LIBOR Loans, upon the expiration
of the Interest Period in effect at the time any such increase in interest rate
is effective such LIBOR Loans shall thereupon become Base Rate Loans and shall
thereafter bear interest payable upon demand at a rate which is 2.00% per annum
in excess of the interest rate otherwise payable under this Agreement for Base
Rate Loans. Payment or acceptance of the increased rates of interest provided
for in this subsection 2.2E is not a permitted alternative to timely payment and
shall not constitute a waiver of any Event of Default or otherwise prejudice or
limit any rights or remedies of Administrative Agent or any Lender.
F. COMPUTATION OF INTEREST. Interest on the Loans shall be computed (i)
in the case of Base Rate Loans, on the basis of a 365-day year (or 366-day year,
in the case of a leap year), and (ii) in the case of LIBOR Loans, on the basis
of a 360-day year, in each case for the actual number of days elapsed in the
period during which it accrues. In computing interest on any Loan, the date of
the making of such Loan or the first day of an Interest Period applicable to
such Loan or, with respect to a Base Rate Loan being converted from a
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CREDIT AGREEMENT
LIBOR Loan, the date of conversion of such LIBOR Loan to such Base Rate Loan, as
the case may be, shall be included, and the date of payment or repayment of such
Loan or the expiration date of an Interest Period applicable to such Loan or,
with respect to a Base Rate Loan being converted to a LIBOR Loan, the date of
conversion of such Base Rate Loan to such LIBOR Loan, as the case may be, shall
be excluded; PROVIDED that if a Loan is repaid on the same day on which it is
made, one day's interest shall be paid on that Loan.
2.3 FEES.
A. COMMITMENT FEE. Borrowers agree to pay to Administrative Agent, for
distribution to each Lender in proportion to that Lender's Pro Rata Share of the
Revolving Loan Commitments, commitment fees for the period from and including
the Closing Date to and excluding the Revolving Loan Commitment Termination Date
equal to the average of the daily excess of the Revolving Loan Commitments over
the Total Utilization of Revolving Loan Commitments MULTIPLIED by (i) 0.75% per
annum, if the Total Utilization of Revolving Loan Commitments is equal to or
less than 33% of the Revolving Loan Commitments, or (ii) 0.50% per annum, if the
Total Utilization of Revolving Loan Commitments is greater than 33% of the
Revolving Loan Commitments; such commitment fees to be calculated on the basis
of a 360-day year and the actual number of days elapsed and to be payable
quarterly in arrears on the last Business Day of each March, June, September and
December of each Fiscal Year commencing on the first such date to occur after
the Closing Date, and on the Revolving Loan Commitment Termination Date.
B. OTHER FEES. Borrowers agrees to pay to Co-Lead Arrangers and
Administrative Agent such fees in the amounts and at the times separately agreed
upon in writing between Borrowers, Co-Lead Arrangers and Administrative Agent.
2.4 REPAYMENTS AND PREPAYMENTS; GENERAL PROVISIONS REGARDING PAYMENTS;
APPLICATION OF PROCEEDS OF COLLATERAL AND PAYMENTS UNDER SUBSIDIARY
GUARANTY.
A. SCHEDULED PAYMENTS OF TERM LOAN. Borrowers shall make principal
payments on the Term Loan in quarterly installments equal to 1.66% of the
original principal amount thereof on each September 30, December, 31, March 31
and June 30, commencing on September 30, 2001 and through and including the
quarterly payment date immediately preceding the Term Loan Maturity Date. On the
Term Loan Maturity Date, Borrowers shall make a final principal payment in the
amount of (i) 88.38% of the original principal amount of the Term Loan, if such
Term Loan Maturity Date is May 31, 2003, (ii) 85.06% of the original principal
amount of the Term Loan, if such Term Loan Maturity Date is December 31, 2003,
(iii) 81.74% of the original principal amount of the Term Loan, if such Term
Loan Maturity Date is April 30, 2004 and (iv) 75.10% of the original principal
amount of the Term Loan, if such Term Loan Maturity Date is May 31, 2005;
PROVIDED that the scheduled installments of principal of the Term Loan set forth
above shall be reduced in connection with any voluntary or mandatory prepayments
of the Term Loan in accordance with subsection 2.4B(iv); and PROVIDED, FURTHER
that the Term Loan and all other amounts owed hereunder with respect to the Term
Loan shall be paid in full no later than the Term Loan Maturity Date, and the
final installment payable by Borrowers in respect of the Term
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CREDIT AGREEMENT
Loan on such date shall be in an amount, if such amount is different from that
specified above, sufficient to repay all amounts owing by Borrowers under this
Agreement with respect to the Term Loan.
B. PREPAYMENTS AND UNSCHEDULED REDUCTIONS IN REVOLVING LOAN
COMMITMENTS.
(i) VOLUNTARY PREPAYMENTS. Borrowers may, upon not less than one
Business Day's prior written notice, given to Administrative Agent by
12:00 Noon (New York City time) on the date required (which written
notice Administrative Agent will promptly transmit by telefacsimile or
telephone to each Lender), at any time and from time to time prepay
any Term Loan or Revolving Loans on any Business Day in whole or in
part in an aggregate minimum amount of $1,000,000 and integral
multiples of $100,000 in excess of that amount; PROVIDED, HOWEVER,
that any LIBOR Loan may be prepaid on a day other than the expiration
of the Interest Period applicable thereto, only if Borrowers pay the
amounts due pursuant to subsection 2.6D caused by such prepayment;
PROVIDED, FURTHER, the Borrowers may not prepay the Term Loan if after
giving effect to such prepayment, there are any outstanding Revolving
Loans. Notice of prepayment having been given as aforesaid, the
principal amount of the Loans specified in such notice shall become
due and payable on the prepayment date specified therein. Any such
voluntary prepayment shall be applied as specified in subsection
2.4B(iv).
(ii) VOLUNTARY REDUCTIONS OF REVOLVING LOAN COMMITMENTS.
Borrowers may, upon not less than three Business Days' prior written
notice to Administrative Agent (which written notice Administrative
Agent will promptly transmit by telefacsimile or telephone to each
Lender), at any time and from time to time terminate in whole or
permanently reduce in part, without premium or penalty, the Revolving
Loan Commitments in an amount up to the amount by which the Revolving
Loan Commitments exceed the Total Utilization of Revolving Loan
Commitments at the time of such proposed termination or reduction;
provided that any such partial reduction of the Revolving Loan
Commitments shall be in an aggregate minimum amount of $1,000,000 and
integral multiples of $100,000 in excess of that amount. Borrowers'
notice to Administrative Agent shall designate the date (which shall
be a Business Day) of such termination or reduction and the amount of
any partial reduction, and such termination or reduction of the
Revolving Loan Commitments shall be effective on the date specified in
Borrowers' notice and shall reduce the Revolving Loan Commitment of
each Lender proportionately to its Pro Rata Share. The amount of the
Revolving Loan Commitments terminated or reduced hereunder shall not
be reinstated.
(iii) MANDATORY PREPAYMENTS. Subject to the provisions of
subsection 2.4B(iv)(e), the Loans shall be prepaid under the
circumstances set forth below, all such prepayments to be applied as
set forth below or as more specifically provided in subsection
2.4B(iv):
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CREDIT AGREEMENT
(a) PREPAYMENTS FROM NET ASSET SALE PROCEEDS. No later than
one Business Day after the date of receipt by Borrowers or any of
their Subsidiaries of any Net Asset Sale Proceeds, Borrowers
shall FIRST prepay the Revolving Loans (without any reduction of
the Revolving Loan Commitments) by an amount equal to such Net
Asset Sale Proceeds, and SECOND to the extent there is any
excess, prepay the Term Loan; PROVIDED, HOWEVER, that to the
extent any Near-Term Maturity Notes are then outstanding, the
Borrowers may retain a portion of Net Asset Sale Proceeds as Cash
or Cash Equivalents up to the amount required to repay such
Near-Term Maturity Notes and on or prior to the payment date with
respect to such Near-Term Maturity Notes Borrowers shall apply
such amounts to the payment or repurchase thereof.
(b) PREPAYMENTS DUE TO ISSUANCE OF DEBT OR EQUITY
SECURITIES. On the first Business Day after the date of receipt
by Borrowers or any Subsidiary of Net Securities Proceeds,
Borrowers shall FIRST prepay the Revolving Loan by an amount
equal to such Net Securities Proceeds (without any reduction of
the Revolving Loan Commitments), and SECOND to the extent there
is any excess, prepay the Term Loan.
(c) CALCULATIONS OF NET PROCEEDS AMOUNTS AND ADDITIONAL
PREPAYMENTS ON SUBSEQUENT CALCULATIONS. Concurrently with any
prepayment of the Loans pursuant to subsections 2.4B(iii)(a) or
(b), Borrowers shall deliver to Administrative Agent an Officers'
Certificate demonstrating the calculation of the amount (the "NET
PROCEEDS AMOUNT") of the applicable Net Asset Sale Proceeds or
the Net Securities Proceeds that gave rise to such prepayment and
in the case of Net Asset Sale Proceeds arising as a result of the
sale of any Collateral securing the Secured Obligations (as
defined in the Collateral Documents), certifying that no event of
default then exists with respect to such Secured Obligations. In
the event that no event of default then exists, such Net Asset
Sale Proceeds shall be applied in accordance with the terms of
this Agreement. In the event that an event of default then exists
with respect to any of the Secured Obligations, such Net Asset
Sale Proceeds shall be held by Administrative Agent in a
collateral account for the benefit of all of the holders of the
Secured Obligations until such time as either no event of default
exists with respect to such Secured Obligations (in which case
such Net Asset Sale Proceeds shall be applied in accordance with
the terms of this Agreement) or until otherwise applied as
required under subsection 2.4D(i). In the event that Borrowers
shall subsequently determine that the actual Net Proceeds Amount
was greater than the amount set forth in such Officers'
Certificate (including if any actual taxes to be paid as a result
of an Asset Sale are less than the estimated taxes to be paid as
a result of such Asset Sale or if such Net Asset Sale Proceeds
have not been applied to the payment or repurchase of Near-Term
Maturity Notes), Borrowers shall promptly make an additional
prepayment of the Loans in an amount equal to the amount of such
excess, and Borrowers shall concurrently therewith deliver to
Administrative
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CREDIT AGREEMENT
Agent an Officers' Certificate demonstrating the derivation of
the additional Net Proceeds Amount resulting in such excess.
(d) PREPAYMENTS DUE TO RESTRICTIONS ON REVOLVING LOAN
COMMITMENTS. Borrowers shall from time to time prepay the
Revolving Loans to the extent necessary so that the Total
Utilization of Revolving Loan Commitments shall (1) not exceed
the Revolving Loan Commitments then in effect, (2) result in,
within six Business Days after a borrowing of Revolving Loans,
the sum of Cash and Cash Equivalents being equal to or less than
$35,000,000 for at least one Business Day or (3) not result in
Liquidity being less than any Required Refinancing Liquidity
during any applicable Required Refinancing Liquidity Period.
(iv) APPLICATION OF PREPAYMENTS.
(a) APPLICATION OF VOLUNTARY PREPAYMENTS BY TYPE OF LOANS
AND ORDER OF MATURITY. Subject to the provisions of subsection
2.4D, any voluntary prepayments pursuant to subsection 2.4B(i)
shall be applied as specified by Borrowers in the applicable
notice of prepayment; PROVIDED that in the event Borrowers fail
to specify the Loans to which any such prepayment shall be
applied, such prepayment shall be applied FIRST to repay
outstanding Revolving Loans to the full extent thereof, and
SECOND to repay the outstanding Term Loan to the full extent
thereof. Any voluntary prepayments of the Term Loan pursuant to
subsection 2.4B(i) shall be applied to reduce the scheduled
installments of principal of the Term Loan set forth in
subsection 2.4A on an equal basis (based on the number of
remaining scheduled installments and the final installment on the
Term Loan Maturity Date) to reduce the amount of the then
remaining scheduled installments and the final installment set
forth in subsection 2.4A.
(b) APPLICATION OF MANDATORY PREPAYMENTS OF TERM LOAN AND
THE SCHEDULED INSTALLMENTS OF PRINCIPAL THEREOF. Any mandatory
prepayments of the Term Loan pursuant to subsection 2.4B(iii)
shall be applied to reduce the scheduled installments of
principal of the Term Loan set forth in subsection 2.4A on an
equal basis (based on the number of remaining scheduled
installments and the final installment on the Term Loan Maturity
Date) to reduce the amount of the then remaining scheduled
installments and the final installment set forth in subsection
2.4A; PROVIDED that with respect to mandatory prepayments from
Net Asset Sale Proceeds of Asset Sales of Healthcare Assets, such
mandatory prepayments shall be applied FIRST to reduce the amount
of the next scheduled installments of principal set forth in
subsection 2.4A to the extent the same is due within 90 days of
such Asset Sales and SECOND, to the extent any excess remains
thereafter, the balance of such prepayment shall be applied on an
equal basis (based on the number of remaining scheduled
installments and the final installment on the Term Loan Maturity
Date) to reduce the amount of the then remaining scheduled
installments and the final installment set forth in subsection
2.4A.
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CREDIT AGREEMENT
(c) APPLICATION OF PREPAYMENTS TO BASE RATE LOANS AND LIBOR
LOANS. Unless the application of such prepayment is otherwise
designated by Borrowers, considering Term Loans and Revolving
Loans being prepaid separately, any prepayment thereof shall be
applied first to Base Rate Loans to the full extent thereof
before application to LIBOR Loans, in each case in a manner which
minimizes the amount of any payments required to be made by
Borrowers pursuant to subsection 2.6D.
(d) PREPAYMENTS OF TERM LOAN WITHIN TWO YEARS OF THE CLOSING
DATE. Any optional prepayments of the Term Loan pursuant to
subsection 2.4B(i) shall be subject to a premium equal to (i)
with respect to prepayments made on or before the first
anniversary of the Closing Date, 1.00% of the principal amount of
Term Loan prepaid, and (ii) with respect to prepayments made on
or before the second anniversary and after the first anniversary
of the Closing Date, 0.50% of the principal amount of Term Loan
prepaid.
(e) WAIVER OF CERTAIN MANDATORY PREPAYMENTS. Notwithstanding
the foregoing, in the case of any mandatory prepayment of Term
Loans under subsection 2.4B(iii) with respect to which Borrowers
have given Administrative Agent at least 10 Business Days'
written notification prior to Administrative Agent's receipt of
such mandatory prepayment, that Borrowers have elected to give
each Term Loan Lender the option to waive their rights to receive
such mandatory prepayment (a "WAIVABLE MANDATORY PREPAYMENT"),
Administrative Agent shall, prior to receipt of such Waivable
Mandatory Prepayment, notify each Term Loan Lender of the amount
of such Waivable Mandatory Prepayment to be applied to such
Lender's Term Loan, the receipt of which may be waived by such
Term Loan Lender, and of the designation of such Waivable
Mandatory Prepayment as such by Borrower. If any such Term Loan
Lender desires to waive such Lender's right to receive such
Waivable Mandatory Prepayment, (A) such Term Loan Lender shall so
advise Administrative Agent in writing no later than five
Business Days after the date it receives such notice from
Administrative Agent and (B) upon receipt of such written advice
from such Term Loan Lender, Administrative Agent shall notify
Borrowers of the aggregate amount of any such Waivable Mandatory
Prepayment that will not be applied as mandatory prepayments on
the Term Loans but which may be retained by Borrowers.
C. GENERAL PROVISIONS REGARDING PAYMENTS.
(i) MANNER AND TIME OF PAYMENT. All payments by Borrowers of
principal, interest, fees and other Obligations hereunder and under
the Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and
delivered to Administrative Agent not later than 3:00 P.M. (New York
City time) on the date due at the Administrative Agent's Office for
the account of Lenders; funds received by Administrative Agent after
that time on such due date shall be deemed to have been paid by
Borrowers on the next succeeding Business Day. Borrowers hereby
authorize Administrative Agent to
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CREDIT AGREEMENT
charge their accounts with Administrative Agent in order to cause
timely payment to be made to Administrative Agent of all principal,
interest, fees and expenses due hereunder (subject to sufficient funds
being available in their accounts for that purpose).
(ii) APPLICATION OF PAYMENTS. Prior to any payments being applied
to principal or interest under this Agreement, such payments shall
first be applied to any outstanding and payable fees, costs, expenses,
indemnities or other amounts (aside from principal or interest due
under the Loan Documents), as determined in the reasonable opinion of
Administrative Agent.
(iii) APPLICATION OF PAYMENTS TO PRINCIPAL AND INTEREST. Except
as provided in subsection 2.2C, all payments in respect of the
principal amount of any Loan shall include payment of accrued interest
on the principal amount being repaid or prepaid, and all such payments
(and, in any event, any payments in respect of any Loan on a date when
interest is due and payable with respect to such Loan) shall be
applied to the payment of interest before application to principal.
(iv) APPORTIONMENT OF PAYMENTS. Aggregate principal and interest
payments in respect of Term Loan and Revolving Loans shall be
apportioned among all outstanding Loans to which such payments relate,
in each case proportionately to Lenders' respective Pro Rata Shares.
Administrative Agent shall promptly distribute to each Lender, at its
primary address set forth below its name on the appropriate signature
page hereof or at such other address as such Lender may request, its
Pro Rata Share of all such payments received by Administrative Agent
and the commitment fees of such Lender when received by Administrative
Agent pursuant to subsection 2.3. Notwithstanding the foregoing
provisions of this subsection 2.4C(iv), if, pursuant to the provisions
of subsection 2.6C, any Notice of Conversion/Continuation is withdrawn
as to any Affected Lender or if any Affected Lender makes Base Rate
Loans in lieu of its Pro Rata Share of any LIBOR Loans, Administrative
Agent shall give effect thereto in apportioning payments received
thereafter.
(v) PAYMENTS ON BUSINESS DAYS. Subject to subsection 2.2B(iii),
whenever any payment to be made hereunder shall be stated to be due on
a day that is not a Business Day, such payment shall be made on the
next succeeding Business Day and such extension of time shall be
included in the computation of the payment of interest hereunder or of
the commitment fees hereunder, as the case may be.
(vi) NOTATION OF PAYMENT. Each Lender agrees that before
disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation
thereon of all Loans evidenced by that Note and all principal payments
previously made thereon and of the date to which interest thereon has
been paid; PROVIDED that the failure to make (or any error in the
making of) a notation of any Loan made under such Note shall not limit
or otherwise affect the obligations of Borrowers hereunder or under
such Note with respect to any Loan or any payments of principal or
interest on such Note.
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CREDIT AGREEMENT
D. APPLICATION OF PROCEEDS OF COLLATERAL AND PAYMENTS UNDER SUBSIDIARY
GUARANTY.
(i) APPLICATION OF CERTAIN PAYMENTS; APPLICATION OF PROCEEDS OF
COLLATERAL. Except as provided in subsection 2.4B(iii)(c) with respect
to prepayments from Net Asset Sale Proceeds, all proceeds received by
Administrative Agent in respect of any sale of, collection from, or
other realization upon all or any part of the Collateral under any
Collateral Document after the occurrence of an event of default with
respect to any of the Secured Obligations may, in the discretion of
Administrative Agent, be held by Administrative Agent as Collateral
for, and/or (then or at any time thereafter) applied in full or in
part by Administrative Agent against, the applicable Secured
Obligations (as defined in such Collateral Document) in the following
order of priority:
(a) To the payment of all costs and expenses of such sale,
collection or other realization, including reasonable
out-of-pocket costs and expenses to Administrative Agent and its
agents and counsel, and all other expenses, liabilities and
advances made or incurred by Administrative Agent in connection
therewith, and all amounts for which Administrative Agent is
entitled to indemnification under such Collateral Document and
all advances made by Administrative Agent thereunder for the
account of the applicable Loan Party, and to the payment of all
costs and expenses paid or incurred by Administrative Agent in
connection with the exercise of any right or remedy under such
Collateral Document, all in accordance with the terms of this
Agreement and such Collateral Document;
(b) thereafter, to the extent of any excess such proceeds,
to the payment of all other Secured Obligations (as defined in
such Collateral Document) for the equal and ratable benefit of
the holders thereof; and
(c) thereafter, to the extent of any excess such proceeds,
to the payment to or upon the order of such Loan Party or to
whosoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct.
(ii) APPLICATION OF PAYMENTS UNDER SUBSIDIARY GUARANTY. All
payments received by Administrative Agent under the Subsidiary
Guaranty after the occurrence of an Event of Default shall be applied
promptly from time to time by Administrative Agent in the following
order of priority:
(a) To the payment of the costs and expenses of any
collection or other realization under the Subsidiary Guaranty,
including reasonable out-of-pocket costs and expenses to
Administrative Agent and its Administrative Agents and counsel,
and all expenses, liabilities and advances made or incurred by
Administrative Agent in connection therewith, all in accordance
with the terms of this Agreement and the Subsidiary Guaranty;
46
CREDIT AGREEMENT
(b) thereafter, to the extent of any excess such payments,
to the payment of all other Guarantied Obligations (as defined in
the Subsidiary Guaranty for the ratable benefit of the holders
thereof); and
(c) thereafter, to the extent of any excess such payments,
to the payment to the applicable Subsidiary Guarantor or to
whosoever may be lawfully entitled to receive the same or as a
court of competent jurisdiction may direct.
2.5 USE OF PROCEEDS.
A. TERM LOAN. The proceeds of the Term Loan, together with proceeds of
the initial Revolving Loans shall first be applied by Borrowers to
contemporaneously (i) consummate the Refinancing and repay in full all
outstanding principal and accrued and unpaid interest of the Existing Credit
Facility and simultaneously with such repayment (ii) terminate all commitments
under the Existing Credit Facility.
B. REVOLVING LOANS. The proceeds of any other Revolving Loans shall be
applied by Borrowers and their Subsidiaries for general corporate purposes.
C. MARGIN REGULATIONS. No portion of the proceeds of any borrowing
under this Agreement shall be used by Borrowers or any of their Subsidiaries in
any manner that might cause the borrowing or the application of such proceeds to
violate Regulation T, Regulation U or Regulation X of the Board of Governors of
the Federal Reserve System or any other regulation of such Board or to violate
the Exchange Act, in each case as in effect on the date or dates of such
borrowing and such use of proceeds.
2.6 SPECIAL PROVISIONS GOVERNING LIBOR LOANS.
Notwithstanding any other provision of this Agreement to the contrary,
the following provisions shall govern with respect to LIBOR Loans as to the
matters covered:
A. DETERMINATION OF APPLICABLE INTEREST RATE. As soon as practicable
after 12:00 Noon (New York City time) on each Interest Rate Determination Date,
Administrative Agent shall determine (which determination shall, absent manifest
error, be final, conclusive and binding upon all parties) the interest rate that
shall apply to the LIBOR Loans for which an interest rate is then being
determined for the applicable Interest Period and shall promptly give notice
thereof (in writing or by telephone confirmed in writing) to Borrowers and each
Lender.
B. INABILITY TO DETERMINE APPLICABLE INTEREST RATE. In the event that
Administrative Agent shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto), on any Interest Rate
Determination Date with respect to any LIBOR Loans, that by reason of
circumstances affecting the interbank Eurodollar market adequate and fair means
do not exist for ascertaining the interest rate applicable to such Loans on the
basis provided for in the definition of Adjusted LIBOR, Administrative Agent
shall on such date give notice (by telefacsimile or by telephone confirmed in
writing) to Borrowers and each Lender of such determination, whereupon (i) no
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CREDIT AGREEMENT
Loans may be made as, or converted to, LIBOR Loans until such time as
Administrative Agent notifies Borrowers and Lenders that the circumstances
giving rise to such notice no longer exist and (ii) any Notice of Borrowing or
Notice of Conversion/Continuation given by Borrowers with respect to the Loans
in respect of which such determination was made shall be deemed to be rescinded
by Borrowers.
C. ILLEGALITY OR IMPRACTICABILITY OF LIBOR LOANS. In the event that on
any date any Lender shall have determined (which determination shall be final
and conclusive and binding upon all parties hereto but shall be made only after
consultation with Borrowers and Administrative Agent) that the making,
maintaining or continuation of its LIBOR Loans (i) has become unlawful as a
result of compliance by such Lender in good faith with any law, treaty,
governmental rule, regulation, guideline or order (or would conflict with any
such treaty, governmental rule, regulation, guideline or order not having the
force of law even though the failure to comply therewith would not be unlawful)
or (ii) has become impracticable, or would cause such Lender material hardship,
as a result of contingencies occurring after the date of this Agreement which
materially and adversely affect the interbank Eurodollar market or the position
of such Lender in that market, then, and in any such event, such Lender shall be
an "AFFECTED LENDER" and it shall on that day give notice (by telefacsimile or
by telephone confirmed in writing) to Borrowers and Administrative Agent of such
determination (which notice Administrative Agent shall promptly transmit to each
other Lender). Thereafter (a) the obligation of Affected Lender to make Loans
as, or to convert Loans to, LIBOR Loans shall be suspended until such notice
shall be withdrawn by Affected Lender, (b) to the extent such determination by
Affected Lender relates to a LIBOR Loan then being requested by Borrowers
pursuant to a Notice of Borrowing or a Notice of Conversion/Continuation,
Affected Lender shall make such Loan as (or convert such Loan to, as the case
may be) a Base Rate Loan, (c) Affected Lender's obligation to maintain its
outstanding LIBOR Loans (the "AFFECTED LOANS") shall be terminated at the
earlier to occur of the expiration of the Interest Period then in effect with
respect to the Affected Loans or when required by law, and (d) the Affected
Loans shall automatically convert into Base Rate Loans on the date of such
termination. Notwithstanding the foregoing, to the extent a determination by an
Affected Lender as described above relates to a LIBOR Loan then being requested
by Borrowers pursuant to a Notice of Borrowing or a Notice of
Conversion/Continuation, Borrowers shall have the option, subject to the
provisions of subsection 2.6D, to rescind such Notice of Borrowing or Notice of
Conversion/Continuation as to all Lenders by giving notice (by telefacsimile or
by telephone confirmed in writing) to Administrative Agent of such rescission on
the date on which Affected Lender gives notice of its determination as described
above (which notice of rescission Administrative Agent shall promptly transmit
to each other Lender). Except as provided in the immediately preceding sentence,
nothing in this subsection 2.6C shall affect the obligation of any Lender other
than an Affected Lender to make or maintain Loans as, or to convert Loans to,
LIBOR Loans in accordance with the terms of this Agreement.
D. COMPENSATION FOR BREAKAGE OR NON-COMMENCEMENT OF INTEREST PERIODS.
Borrowers shall compensate each Lender, upon written request by that Lender
(which request shall set forth the basis for requesting such amounts), for all
reasonable losses, expenses and liabilities (including any interest paid by that
Lender to lenders of funds borrowed by it to make or carry its LIBOR Loans and
any loss, expense or liability sustained
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CREDIT AGREEMENT
by that Lender in connection with the liquidation or re-employment of such
funds) which that Lender may sustain: (i) if for any reason (other than a
default by that Lender) a borrowing of any LIBOR Loan does not occur on a date
specified therefor in a Notice of Borrowing or a telephonic request for
borrowing, or a conversion to or continuation of any LIBOR Loan does not occur
on a date specified therefor in a Notice of Conversion/Continuation or a
telephonic request for conversion or continuation, (ii) if any prepayment
(including any prepayment pursuant to subsection 2.4A or 2.4B(i)) or other
principal payment or any conversion of any of its LIBOR Loans occurs on a date
prior to the last day of an Interest Period applicable to that Loan, (iii) if
any prepayment of any of its LIBOR Loans is not made on any date specified in a
notice of prepayment given by Borrowers, or (iv) as a consequence of any other
default by Borrowers in the repayment of its LIBOR Loans when required by the
terms of this Agreement.
E. BOOKING OF LIBOR LOANS. Any Lender may make, carry or transfer LIBOR
Loans at, to, or for the account of any of its branch offices or the office of
an Affiliate of that Lender.
F. ASSUMPTIONS CONCERNING FUNDING OF LIBOR LOANS. Calculation of all
amounts payable to a Lender under this subsection 2.6 and under subsection 2.7A
shall be made as though that Lender had actually funded each of its relevant
LIBOR Loans through the purchase of a Eurodollar deposit bearing interest at the
rate obtained pursuant to clause (i) of the definition of Adjusted LIBOR in an
amount equal to the amount of such LIBOR Loan and having a maturity comparable
to the relevant Interest Period and through the transfer of such Eurodollar
deposit from an offshore office of that Lender to a domestic office of that
Lender in the United States of America; PROVIDED, HOWEVER, that each Lender may
fund each of its LIBOR Loans in any manner it sees fit and the foregoing
assumptions shall be utilized only for the purposes of calculating amounts
payable under this subsection 2.6 and under subsection 2.7A.
G. LIBOR LOANS AFTER DEFAULT. After the occurrence of and during the
continuation of an Event of Default, (i) Borrowers may not elect to have a Loan
be made or maintained as, or converted to, a LIBOR Loan after the expiration of
any Interest Period then in effect for that Loan and (ii) subject to the
provisions of subsection 2.6D, any Notice of Borrowing or Notice of Conversion/
Continuation given by Borrowers with respect to a requested borrowing or
conversion/ continuation that has not yet occurred shall be deemed to be
rescinded by Borrowers.
2.7 INCREASED COSTS; TAXES; CAPITAL ADEQUACY.
A. COMPENSATION FOR INCREASED COSTS AND TAXES. Subject to the
provisions of subsection 2.7B (which shall be controlling with respect to the
matters covered thereby), in the event that any Lender shall determine (which
determination shall, absent manifest error, be final and conclusive and binding
upon all parties hereto) that any law, treaty or governmental rule, regulation
or order, or any change therein or in the interpretation, administration or
application thereof (including the implementation of any new law, treaty or
governmental rule, regulation or order), or any determination of a court or
governmental authority, in each case that becomes effective after the date
hereof, or compliance by such
49
CREDIT AGREEMENT
Lender with any guideline, request or directive issued or made after the date
hereof by any central bank or other governmental or quasi-governmental authority
(whether or not having the force of law):
(i) subjects such Lender (or its applicable lending office) to
any additional Tax with respect to this Agreement or any of its
obligations hereunder or any payments to such Lender (or its
applicable lending office) of principal, interest, fees or any other
amount payable hereunder;
(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve),
special deposit, compulsory loan, FDIC insurance or similar
requirement against assets held by, or deposits or other liabilities
in or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such
Lender (other than any such reserve or other requirements with respect
to LIBOR Loans that are reflected in the definition of Adjusted
LIBOR); or
(iii) imposes any other condition (other than with respect to a
Tax matter) on or affecting such Lender (or its applicable lending
office) or its obligations hereunder or the interbank Eurodollar
market;
and the result of any of the foregoing is to increase the cost to such Lender of
agreeing to make, making or maintaining Loans hereunder or to reduce any amount
received or receivable by such Lender (or its applicable lending office) with
respect thereto; then, in any such case, Borrowers shall promptly pay to such
Lender, upon receipt of the statement referred to in the next sentence, such
additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder. Such Lender shall deliver to Borrowers (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this subsection
2.7A, which statement shall be conclusive and binding upon all parties hereto
absent manifest error.
B. WITHHOLDING OF TAXES.
(i) PAYMENTS TO BE FREE AND CLEAR. Unless otherwise required by
applicable law, all sums payable by Borrowers under this Agreement and
the other Loan Documents shall be paid free and clear of, and without
any deduction or withholding on account of, any Tax imposed, levied,
collected, withheld or assessed by or within the United States of
America or any political subdivision in or of the United States of
America or any other jurisdiction from or to which a payment is made
by or on behalf of Borrowers.
(ii) GROSSING-UP OF PAYMENTS. If Borrowers or any other Person is
required by law to make any deduction or withholding on account of any
such Tax
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CREDIT AGREEMENT
from any sum paid or payable by Borrowers to Administrative Agent or
any Lender under any of the Loan Documents:
(a) Borrowers shall notify Administrative Agent of any such
requirement or any change in any such requirement as soon as
Borrowers becomes aware of it;
(b) Borrowers shall pay any such Tax when such Tax is due,
regardless of whether the liability for payment of such Tax (i)
is imposed on Borrowers itself, Administrative Agent or any
Lender or (ii) relates to any portion of any sums paid or payable
to any Lender under any of the Loan Documents with respect to
which such Lender does not act for its own account;
(c) the sum payable by Borrowers in respect of which the
relevant deduction, withholding or payment is required shall be
increased to the extent necessary to ensure that, after the
making of that deduction, withholding or payment, Administrative
Agent or such Lender, as the case may be, receives on the due
date a net sum equal to what it would have received had no such
deduction, withholding or payment been required or made; and
(d) within 30 days after paying any sum from which it is
required by law to make any deduction or withholding, and within
30 days after the due date of payment of any Tax which it is
required by clause (b) above to pay, Borrowers shall deliver to
Administrative Agent evidence satisfactory to the other affected
parties of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority;
PROVIDED that no such additional amount shall be required to
be paid to any Lender under clause (c) above (i) to the extent such
additional amount relates to a portion of any sums paid or payable to
such Lender under any of the Loan Documents with respect to which such
Lender does not act for its own account, or (ii) except to the extent
that any change after the date such Lender became a Lender in any such
requirement for a deduction, withholding or payment as is mentioned
therein shall result in an increase in the rate of such deduction,
withholding or payment from that in effect at the date on which such
Lender became a Lender, in respect of payments to such Lender.
(iii) EVIDENCE OF EXEMPTION FROM U.S. WITHHOLDING TAX.
(a) Each Lender that is organized under the laws of any
jurisdiction other than the United States or any state or other
political subdivision thereof (for purposes of this subsection
2.7B(iii), a "NON-US LENDER") shall deliver to Administrative
Agent and to Borrowers, on or prior to the Closing Date (in the
case of each Lender listed on the signature pages hereof) or on
or prior to the date of the Assignment Agreement pursuant to
which it becomes a Lender (in the case of each other Lender), and
at such
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CREDIT AGREEMENT
other times as may be necessary in the determination of Borrowers
or Administrative Agent (each in the reasonable exercise of its
discretion), two original copies of Internal Revenue Service Form
W-8BEN or W-8ECI (or any successor forms) properly completed and
duly executed by such Lender, or, in the case of a Non-US Lender
claiming exemption from United States federal withholding tax
under Section 871(h) or 881(c) of the Internal Revenue Code with
respect to payments of "portfolio interest", a form W-8BEN, and,
in the case of a Lender that has certified in writing to
Administrative Agent that it is not a "bank" (as defined in
Section 881(c)(3)(A) of the Internal Revenue Code), a certificate
of such Lender certifying that such Lender is not (i) a "bank"
for purposes of Section 881(c) of the Internal Revenue Code, (ii)
a ten-percent shareholder (within the meaning of Section
871(h)(3)(B) of the Internal Revenue Code) of Borrowers, or (iii)
a controlled foreign corporation related to Borrowers (within the
meaning of Section 864(d)(4) of the Internal Revenue Code) in
each case together with any other certificate or statement of
exemption required under the Internal Revenue Code or the
regulations issued thereunder to establish that such Lender is
not subject to United States withholding tax with respect to any
payments to such Lender of interest payable under any of the Loan
Documents.
(b) Each Non-US Lender, to the extent it does not act or
ceases to act for its own account with respect to any portion of
any sums paid or payable to such Lender under any of the Loan
Documents (for example, in the case of a typical participation by
such Lender), shall deliver to Administrative Agent and to
Borrowers, on or prior to the Closing Date (in the case of each
Lender listed on the signatures pages hereof), on or prior to the
date of the Assignment Agreement pursuant to which it becomes a
Lender (in the case of each other Lender), or on such later date
when such Lender ceases to act for its own account with respect
to any portion of any such sums paid or payable, and at such
other times as may be necessary in the determination of Borrowers
or Administrative Agent (each in the reasonable exercise of its
discretion), (1) two original copies of the forms or statements
required to be provided by such Lender under subsection
2.7B(iii)(a), properly completed and duly executed by such
Lender, to establish the portion of any such sums paid or payable
with respect to which such Lender acts for its own account that
is not subject to United States withholding tax, and (2) two
original copies of Internal Revenue Service Form W-8IMY (or any
successor forms) properly completed and duly executed by such
Lender, together with any information, if any, such Lender
chooses to transmit with such form, and any other certificate or
statement of exemption required under the Internal Revenue Code
or the regulations issued thereunder, to establish that such
Lender is not acting for its own account with respect to a
portion of any such sums payable to such Lender.
(c) Each Non-US Lender hereby agrees, from time to time
after the initial delivery by such Lender of such forms, whenever
a lapse in time or
52
CREDIT AGREEMENT
change in circumstances renders such forms, certificates or other
evidence so delivered obsolete or inaccurate in any material
respect or in the event that, by virtue of a change in law or
regulations, such forms are no longer valid evidence of a
person's exemption from withholding tax which is reasonably
satisfactory to the Borrowers, that such Lender shall promptly
(1) deliver to Administrative Agent and to Borrowers two original
copies of renewals, amendments or additional or successor forms,
properly completed and duly executed by such Lender, together
with any other certificate or statement of exemption required in
order to confirm or establish that such Lender is not subject to
United States withholding tax with respect to payments to such
Lender under the Loan Documents and, as the case may be, that
such Lender does not act for its own account with respect to any
portion of any such payments, or (2) notify Administrative Agent
and Borrowers of its inability to deliver any such forms,
certificates or other evidence.
(d) Borrowers shall not be required to pay any additional
amount to any Non-US Lender under clause (c) of subsection
2.7B(ii) if such Lender shall have failed to satisfy the
requirements of clause (a), (b) or (c)(1) of this subsection
2.7B(iii); PROVIDED that if such Lender shall have satisfied the
requirements of subsection 2.7B(iii)(a) on the date such Lender
became a Lender, nothing in this subsection 2.7B(iii)(d) shall
relieve Borrowers of their obligation to pay any amounts pursuant
to subsection 2.7B(ii)(c) in the event that, as a result of any
change in any applicable law, treaty or governmental rule,
regulation or order, or any change in the interpretation,
administration or application thereof, such Lender is no longer
properly entitled to deliver forms, certificates or other
evidence at a subsequent date establishing the fact that such
Lender is not subject to withholding as described in subsection
2.7B(iii)(a).
C. CAPITAL ADEQUACY ADJUSTMENT. If any Lender shall have determined
that the adoption, effectiveness, phase-in or applicability after the date
hereof of any law, rule or regulation (or any provision thereof) 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 compliance
by any Lender (or its applicable lending office) with any guideline, 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 such Lender as a consequence of, or with reference
to, such Lender's Loans or Commitments or Letters of Credit or participations
therein or other obligations hereunder with respect to the Loans or the Letters
of Credit to a level below that which such Lender or such controlling
corporation could have achieved but for such adoption, effectiveness, phase-in,
applicability, change or compliance (taking into consideration the policies of
such Lender or such controlling corporation with regard to capital adequacy),
then from time to time, within five Business Days after receipt by Borrowers
from such Lender of the statement referred to in the next sentence, Borrowers
shall pay to such Lender such additional amount or amounts as will compensate
such Lender or such controlling corporation on an after-tax basis for such
53
CREDIT AGREEMENT
reduction. Such Lender shall deliver to Borrowers (with a copy to Administrative
Agent) a written statement, setting forth in reasonable detail the basis of the
calculation of such additional amounts, which statement shall be conclusive and
binding upon all parties hereto absent manifest error.
2.8 OBLIGATION OF LENDERS AND ISSUING LENDERS TO MITIGATE.
Each Lender and Issuing Lender agrees that, as promptly as practicable
after the officer of such Lender or Issuing Lender responsible for administering
the Loans or Letters of Credit of such Lender or Issuing Lender, as the case may
be, becomes aware of the occurrence of an event or the existence of a condition
that would cause such Lender to become an Affected Lender or that would entitle
such Lender or Issuing Lender to receive payments under subsection 2.7 or
subsection 3.6, it will, to the extent not inconsistent with the internal
policies of such Lender or Issuing Lender and any applicable legal or regulatory
restrictions, use reasonable efforts (i) to make, issue, fund or maintain the
Commitments of such Lender or the affected Loans or Letters of Credit of such
Lender or Issuing Lender through another lending or letter of credit office of
such Lender or Issuing Lender, or (ii) take such other measures as such Lender
or Issuing Lender may deem reasonable, if as a result thereof the circumstances
which would cause such Lender to be an Affected Lender would cease to exist or
the additional amounts which would otherwise be required to be paid to such
Lender or Issuing Lender pursuant to subsection 2.7 or subsection 3.6 would be
materially reduced and if, as determined by such Lender or Issuing Lender in its
sole discretion, the making, issuing, funding or maintaining of such Commitments
or Loans or Letters of Credit through such other lending or letter of credit
office or in accordance with such other measures, as the case may be, would not
otherwise materially adversely affect such Commitments or Loans or Letters of
Credit or the interests of such Lender or Issuing Lender; PROVIDED that such
Lender or Issuing Lender will not be obligated to utilize such other lending or
letter of credit office pursuant to this subsection 2.8 unless Borrowers agree
to pay all incremental expenses incurred by such Lender or Issuing Lender as a
result of utilizing such other lending or letter of credit office as described
in clause (i) above. A certificate as to the amount of any such expenses payable
by Borrowers pursuant to this subsection 2.8 (setting forth in reasonable detail
the basis for requesting such amount) submitted by such Lender or Issuing Lender
to Borrowers (with a copy to Administrative Agent) shall be conclusive absent
manifest error.
2.9 EXTENSION OF TERM LOAN AND REVOLVING LOAN COMMITMENT TERMINATION DATES.
A. TERM LOAN MATURITY DATE. Borrowers may, in their sole discretion and
without the payment of any additional costs, expenses or fees to Lenders ,
extend the Term Loan Maturity Date, subject to satisfaction of the following
conditions and PROVIDED that in each instance no Event of Default or Potential
Event of Default then exists:
(i) On, or no earlier than 30 days before, April 30, 2003,
Borrowers may elect to extend the Term Loan Maturity Date to December
31, 2003 by providing an Extension Notice to the Administrative Agent;
provided, that Borrowers may not elect to exercise the extension
option provided for in this subsection 2.9A(i)
54
CREDIT AGREEMENT
unless Borrowers either (x) have refinanced not less than 95% of the
then outstanding 7.82% Senior Notes Due September 30, 2026 or (y) have
and, prior to the earlier to occur of the refinancing of not less than
95% of the then outstanding 7.82% Senior Notes Due September 30, 2026
or September 30, 2003, maintain during the Required Refinancing
Liquidity Period, Liquidity in an amount at least equal to the sum of
(a) the outstanding principal amount of all Indebtedness which either
matures or is redeemable at the option of the holder thereof on or
prior to December 31, 2003 plus (b) $30,000,000;
(ii) On, or no earlier than 30 days before, October 31, 2003,
Borrowers may elect to extend the Term Loan Maturity Date to April 30,
2004 by providing an Extension Notice to the Administrative Agent;
PROVIDED, that the Borrowers may not elect to exercise the extension
option provided for in this subsection 2.9A(ii) unless Borrowers
either (x) have refinanced not less than 95% of the then outstanding
7.25% Senior Notes Due March 2004 or (y) have and, prior to the
earlier to occur of the refinancing of not less than 95% of the then
outstanding 7.25% Senior Notes Due March 2004, or March 15, 2004,
maintain during the Required Refinancing Liquidity Period, Liquidity
in an amount at least equal to the sum of (a) the outstanding
principal amount of all Indebtedness which either matures or is
redeemable at the option of the holder thereof on or prior to April
30, 2004 PLUS (b) $30,000,000; and
(iii) On, or no earlier than 30 days before, March 31, 2004,
Borrowers may elect to extend the Term Loan Maturity Date to May 31,
2005 by providing an Extension Notice to the Administrative Agent;
PROVIDED, that the Borrowers may not elect to exercise the extension
option provided for in this subsection 2.9A(iii) unless Borrowers
either (x) have refinanced not less than 95% of the then outstanding
7.114% Senior Notes Due August 2011 or (y) have and, prior to the
earlier to occur of the refinancing of not less than 95% of the then
outstanding 7.114% Senior Notes Due August 2011 or August 15, 2004,
maintain during the Required Refinancing Liquidity Period, Liquidity
in an amount of at least equal to the sum of (a) the outstanding
principal amount of all Indebtedness which either matures or is
redeemable at the option of the holder thereof on or prior to August
31, 2004 PLUS (b) $30,000,000.
(iv) Each such notice of extension shall be accompanied by an
Officers' Certificate certifying that either the refinancing
contemplated by clause (x) of subparagraphs (i), (ii) or (iii) above
has occurred or that Borrowers have the Liquidity required pursuant to
clause (y) of subparagraphs (i), (ii) or (iii) above and, in such
event, setting out the calculations establishing such Liquidity in
reasonable detail.
B. REVOLVING LOAN COMMITMENT TERMINATION DATE. Borrowers may, in their
sole discretion and without the payment of any additional costs, expenses or
fees to Lenders with respect to the exercise of such option to extend, extend
the Revolving Loan Commitment Termination Date, subject to satisfaction of the
following conditions and PROVIDED that in each instance no Event of Default or
Potential Event of Default then exists:
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CREDIT AGREEMENT
(i) On, or no earlier than 30 days before, April 30, 2003,
Borrowers may elect to extend the Revolving Loan Commitment
Termination Date to December 31, 2003 by providing an Extension Notice
to the Administrative Agent; PROVIDED, that Borrowers may not elect to
exercise the extension option provided for in this subsection
2.9(B)(i) unless Borrowers either (x) have refinanced not less than
95% of the then outstanding 7.82% Senior Notes Due September 2026 or
(y) have and, prior to the earlier to occur of the refinancing of not
less than 95% of the then outstanding 7.82% Senior Notes Due September
30, 2026 or September 30, 2003, maintain during the Required
Refinancing Liquidity Period, Liquidity in an amount at least equal to
the sum of (a) the outstanding principal amount of all Indebtedness
which either matures or is redeemable at the option of the holder
thereof on or prior to December 31, 2003 PLUS (b) $30,000,000; and
(ii) On, or no earlier than 30 days before October 31, 2003,
Borrowers may elect to extend the Revolving Loan Commitment
Termination Date to April 30, 2004 by providing an Extension Notice to
the Administrative Agent; PROVIDED, that the Borrowers either (x) have
refinanced not less than 95% of the then outstanding 7.25% Senior
Notes Due March 2004 or (y) have and, prior to the earlier to occur of
the refinancing of not less than 95% of the then outstanding 7.25%
Senior Notes Due March 2004 or March 15, 2004, maintain during the
Required Refinancing Liquidity Period, Liquidity in an amount at least
equal to the sum of (a) the outstanding principal amount of all
Indebtedness which either matures or is redeemable at the option of
the holder thereof on or prior to April 30, 2004 PLUS (b) $30,000,000.
(iii) Each such notice of extension shall be accompanied by an
Officers' Certificate certifying that either the refinancing
contemplated by clause (x) of subparagraphs (i) or (ii) above has
occurred or that Borrowers have the Liquidity required pursuant to
clause (y) of subparagraphs (i) or (ii) above and, in such event,
setting out the calculations establishing such Liquidity in reasonable
detail.
2.10 BORROWERS.
The Administrative Agent and the Lenders may rely, and shall be fully
protected in relying, on any Notice of Borrowing, Notice of
Conversion/Continuation, Request for Issuance of Letter of Credit, disbursement
instruction, report, information or any other notice or communication made or
given by either Borrower, whether in its own name, on behalf of any other
Borrower or on behalf of "the Borrowers", and neither the Administrative Agent
nor any Lender shall have any obligation to make any inquiry or request any
confirmation from or on behalf of any other Borrower as to the binding effect on
it of any such notice, request, instruction, report, information, other notice
or communications, nor shall the joint and several character of the Borrowers'
liability for the Obligations be affected, provided that the provisions of this
subsection 2.9 shall not be construed so as to preclude any Borrower from taking
other actions permitted to be taken by "a Borrower" hereunder. The
Administrative Agent and each Lender intend to maintain a single loan account in
the name of "Meditrust Corporation" hereunder or any successor name in
connection with the Conversion or otherwise and each Borrower expressly agrees
to such arrangement and
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CREDIT AGREEMENT
confirms that such arrangement shall have no effect on the joint and several
character of its liability for the Obligations.
2.11 JOINT AND SEVERAL LIABILITY.
A. JOINT AND SEVERAL LIABILITY. The Obligations shall constitute one
joint and several direct and general obligation of both of the Borrowers.
Notwithstanding anything to the contrary contained herein, each of the Borrowers
shall be jointly and severally, with the other Borrower, directly and
unconditionally liable to the Administrative Agent and the Lenders for all
Obligations and shall have the obligations of co-maker with respect to the
Loans, the Notes and the Obligations, it being agreed that the advances to each
Borrower inure to the benefit of both Borrowers, and that the Administrative
Agent and the Lenders are relying on the joint and several liability of the
Borrowers as co-makers in extending the Loans hereunder and arranging for the
issuance of Letters of Credit. Each Borrower hereby unconditionally and
irrevocably agrees that upon a default in the payment when due (whether at
stated maturity, by acceleration or otherwise) of any principal of, or interest
on, any Loan or other Obligation payable to the Administrative Agent or any
Lender which constitutes an Event of Default, it will forthwith pay the same,
without notice or demand except to the extent expressly provided to the contrary
herein.
B. NO REDUCTION IN OBLIGATIONS. No payment or payments made by any of
the Borrowers or any other Person or received or collected by the Administrative
Agent or any Lender from any of the Borrowers or any other Person by virtue of
any action or proceeding or any setoff or appropriation or application at any
time or from time to time in reduction of or in payment of the Obligations shall
be deemed to modify, reduce, release or otherwise affect the liability of each
Borrower to repay any outstanding Obligations until all such outstanding
Obligations are paid in full and this Agreement is terminated.
2.12 OBLIGATIONS ABSOLUTE.
Each Borrower agrees that the Obligations will be paid strictly in
accordance with the terms of the Loan Documents, regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of the Administrative Agent or any Lender with
respect thereto. All Obligations shall be conclusively presumed to have been
created in reliance hereon. The liabilities under this Agreement shall be
absolute and unconditional irrespective of: (a) any lack of validity or
enforceability of any Loan Document or any other agreement or instrument
relating thereto; (b) any change in the time, manner or place of payments of, or
in any other term of, all or any part of the Obligations, or any other amendment
or waiver thereof or any consent to departure therefrom, including any increase
in the Obligations resulting from the extension of additional credit to any
Borrower or otherwise; (c) any taking, exchange, release or non-perfection of
any collateral, or any release or amendment or waiver of or consent to departure
from any guaranty for all or any of the Obligations; (d) any change,
restructuring or termination of the corporate structure or existence of any
Borrower; or (e) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, any Borrower. This Agreement shall
continue to be effective or be reinstated, as the case may be, if at any time
any payment of any of the Obligations is rescinded or must otherwise be returned
by the Administrative Agent or any
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CREDIT AGREEMENT
Lender upon the insolvency, bankruptcy or reorganization of any Borrower or
otherwise, all as though such payment had not been made.
2.13 WAIVER OF SURETYSHIP DEFENSES.
Each Borrower agrees that the joint and several liability of the
Borrowers provided for in subsection 2.11 shall not be impaired or affected by
any modification, supplement, extension or amendment of any contract or
agreement to which the other Borrower may hereafter agree (other than an
agreement signed by the Administrative Agent and, if applicable, the Lenders
specifically releasing or limiting such liability), nor by any delay, extension
of time, renewal, compromise or other indulgence granted by the Administrative
Agent or any Lender with respect to any of the Obligations, nor by any other
agreements or arrangements whatever with the other Borrower or with anyone else,
each Borrower hereby waiving all notice of such delay, extension, release,
substitution, renewal, compromise or other indulgence, and hereby consenting to
be bound thereby as fully and effectually as if it had expressly agreed thereto
in advance. The liability of each Borrower is direct and unconditional as to all
of the Obligations, and may be enforced without requiring the Administrative
Agent or any Lender first to resort to any other right, remedy or security. Each
Borrower hereby expressly waives promptness, diligence, notice of acceptance and
any other notice (except to the extent expressly provided for herein or in
another Loan Document) with respect to any of the Obligations, the Notes, this
Agreement or any other Loan Document and any requirement that the Administrative
Agent or any Lender protect, secure, perfect or insure any Lien or any property
subject thereto or exhaust any right or take any action against any Borrower or
any other Person or any collateral.
2.14 CONTRIBUTION AND INDEMNIFICATION AMONG THE BORROWERS.
Each Borrower is obligated to repay the Obligations as joint and
several obligors under this Agreement. To the extent that any Borrower shall,
under this Agreement as a joint and several obligor, repay any of the
Obligations constituting Loans made to the other Borrower hereunder or other
Obligations incurred directly and primarily by the other Borrower (an
"Accommodation Payment"), then the Borrower making such Accommodation Payment
shall be entitled to contribution and indemnification from, and be reimbursed
by, the other Borrower in an amount equal to such Accommodation Payment. All
rights and claims of contribution, indemnification and reimbursement under this
subsection 2.14 shall be subordinate in right of payment to the prior payment in
full in Cash of the Obligations.
2.15 REPLACEMENT OF A LENDER.
If Borrowers receive a statement of amounts due pursuant to subsection
2.7A from a Lender or a Lender of Revolving Loans defaults in its obligations to
fund a Revolving Loan pursuant to this Agreement, or a Lender becomes an
Affected Lender (any such Lender, a "SUBJECT LENDER"), so long as (i) no
Potential Event of Default or Event of Default shall have occurred and be
continuing and Borrowers have obtained a commitment from another Lender or an
Eligible Assignee to purchase at par the Subject Lender's Loans and assume the
Subject Lender's Commitments and all other obligations of the Subject Lender
hereunder, (ii) such Lender is not an Issuing Lender with respect to any Letters
of Credit
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CREDIT AGREEMENT
outstanding (unless all such Letters of Credit are terminated or arrangements
reasonably acceptable to such Issuing Lender (such as a "back-to-back" letter of
credit) are made) and (iii) if applicable, the Subject Lender is unwilling to
withdraw the statement delivered to Company pursuant to subsection 2.7 and/or is
unwilling to remedy its default upon 10 days prior written notice to the Subject
Lender and Administrative Agent, Borrowers may require the Subject Lender to
assign all of its Loans and Commitments to such other Lender, Lenders, Eligible
Assignee or Eligible Assignees pursuant to the provisions of subsection 10.1B;
provided that, prior to or concurrently with such replacement, (1) the Subject
Lender shall have received payment in full of all principal, interest, fees and
other amounts (including all amounts under subsections 2.6D and/or 2.7 (if
applicable)) through such date of replacement and a release from its obligations
under the Loan Documents, (2) any processing fee required to be paid by
subsection 10.1B(i) shall have been paid to Administrative Agent, and (3) all of
the requirements for such assignment contained in subsection 10.1B, including,
without limitation, the consent of Administrative Agent (if required) and the
receipt by Administrative Agent of an executed Assignment Agreement and other
supporting documents, have been fulfilled.
SECTION 3. LETTERS OF CREDIT
3.1 ISSUANCE OF LETTERS OF CREDIT AND LENDERS' PURCHASE OF PARTICIPATIONS
THEREIN.
A. LETTERS OF CREDIT. In addition to Borrowers requesting that Lenders
make Revolving Loans pursuant to subsection 2.1A(ii), Borrowers may request, in
accordance with the provisions of this subsection 3.1, from time to time during
the period from the Closing Date to but excluding the Revolving Loan Commitment
Termination Date, that one or more Lenders issue Letters of Credit for the
account of Borrowers for the purposes specified in the definition of Letters of
Credit. Subject to the terms and conditions of this Agreement and in reliance
upon the representations and warranties of Borrowers herein set forth, any one
or more Lenders may, but (except as provided in subsection 3.1B(ii)) shall not
be obligated to, issue such Letters of Credit in accordance with the provisions
of this subsection 3.1; PROVIDED that Borrowers shall not request that any
Lender issue (and no Lender shall issue):
(i) any Letter of Credit if, after giving effect to such
issuance, the Total Utilization of Revolving Loan Commitments would
(i) exceed the Revolving Loan Commitments of all Lenders or (ii) but
only during the Required Refinancing Liquidity Period, result in
Liquidity being less than any Required Refinancing Liquidity under
subsection 2.9B;
(ii) any Letter of Credit if, after giving effect to such
issuance, the Letter of Credit Usage would exceed $50,000,000;
(iii) any Letter of Credit having an expiration date later than
the earlier of (a) ten days prior to the Revolving Loan Commitment
Termination Date, and (b) the date which is one year from the date of
issuance of such Letter of Credit; PROVIDED that the immediately
preceding clause (b) shall not prevent any Issuing Lender from
agreeing that a Letter of Credit will automatically be extended for
one or more
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CREDIT AGREEMENT
successive periods not to exceed one year each unless such Issuing
Lender elects not to extend for any such additional period; and
PROVIDED FURTHER that such Issuing Lender shall elect not to extend
such Letter of Credit if it has knowledge that an Event of Default has
occurred and is continuing (and has not been waived in accordance with
subsection 10.6) at the time such Issuing Lender must elect whether or
not to allow such extension;
(iv) any Letter of Credit denominated in a currency other than
Dollars; or
(v) any Letter of Credit that is otherwise unacceptable to the
applicable Issuing Lender in its reasonable discretion.
B. MECHANICS OF ISSUANCE.
(i) NOTICE OF ISSUANCE. Whenever Borrowers desire the issuance of
a Letter of Credit, they shall deliver to Administrative Agent a
Notice of Issuance of Letter of Credit substantially in the form of
EXHIBIT III annexed hereto no later than 1:00 P.M. (New York City
time) at least three Business Days, or in each case such shorter
period as may be agreed to by the Issuing Lender in any particular
instance, in advance of the proposed date of issuance. The Notice of
Issuance of Letter of Credit shall specify (a) the proposed date of
issuance (which shall be a Business Day), (b) the face amount of the
Letter of Credit, (c) the expiration date of the Letter of Credit, (d)
the name and address of the beneficiary, and (e) either the verbatim
text of the proposed Letter of Credit or the proposed terms and
conditions thereof, including a precise description of any documents
to be presented by the beneficiary which, if presented by the
beneficiary prior to the expiration date of the Letter of Credit,
would require the Issuing Lender to make payment under the Letter of
Credit; PROVIDED that the Issuing Lender, in its reasonable
discretion, may require changes in the text of the proposed Letter of
Credit or any such documents; and PROVIDED, FURTHER that no Letter of
Credit shall require payment against a conforming draft to be made
thereunder on the same Business Day (under the laws of the
jurisdiction in which the office of the Issuing Lender to which such
draft is required to be presented is located) that such draft is
presented if such presentation is made after 12:00 Noon (in the time
zone of such office of the Issuing Lender) on such Business Day.
Borrowers shall notify the applicable Issuing Lender (and
Administrative Agent, if Administrative Agent is not such Issuing
Lender) prior to the issuance of any Letter of Credit in the event
that any of the matters to which Borrowers are required to certify in
the applicable Notice of Issuance of Letter of Credit is no longer
true and correct as of the proposed date of issuance of such Letter of
Credit, and upon the issuance of any Letter of Credit Borrowers shall
be deemed to have re-certified, as of the date of such issuance, as to
the matters to which Borrowers is required to certify in the
applicable Notice of Issuance of Letter of Credit.
(ii) DETERMINATION OF ISSUING LENDER. Upon receipt by
Administrative Agent of a Notice of Issuance of Letter of Credit
pursuant to subsection 3.1B(i) requesting the issuance of a Letter of
Credit, in the event Administrative Agent elects
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CREDIT AGREEMENT
to issue such Letter of Credit, Administrative Agent shall promptly so
notify Borrowers, and Administrative Agent shall be the Issuing Lender
with respect thereto. In the event that Administrative Agent, in its
sole discretion, elects not to issue such Letter of Credit,
Administrative Agent shall promptly so notify Borrowers, whereupon
Borrowers may request any other Lender to issue such Letter of Credit
by delivering to such Lender a copy of the applicable Notice of
Issuance of Letter of Credit. Any Lender so requested to issue such
Letter of Credit shall promptly notify Borrowers and Administrative
Agent whether or not, in its sole discretion, it has elected to issue
such Letter of Credit, and any such Lender which so elects to issue
such Letter of Credit shall be the Issuing Lender with respect
thereto. If all other Lenders have declined to issue such Letter of
Credit, notwithstanding the prior election of Administrative Agent not
to issue such Letter of Credit, Administrative Agent shall issue such
Letter of Credit and shall be the Issuing Lender with respect thereto,
notwithstanding the fact that the Letter of Credit Usage with respect
to such Letter of Credit and with respect to all other Letters of
Credit issued by Administrative Agent when aggregated with
Administrative Agent's outstanding Revolving Loans may exceed
Administrative Agent's Revolving Loan Commitment then in effect.
(iii) ISSUANCE OF LETTER OF CREDIT. Upon satisfaction or waiver
(in accordance with subsection 10.6) of the conditions set forth in
subsection 4.3, the Issuing Lender shall issue the requested Letter of
Credit in accordance with the Issuing Lender's standard operating
procedures.
(iv) NOTIFICATION TO LENDERS. Upon the issuance of any Letter of
Credit the applicable Issuing Lender shall promptly notify
Administrative Agent and each other Lender of such issuance. Promptly
after receipt of such notice (or, if Administrative Agent is the
Issuing Lender, together with such notice), Administrative Agent shall
notify each Lender of the amount of such Lender's respective
participation in such Letter of Credit, determined in accordance with
subsection 3.1C.
C. LENDERS' PURCHASE OF PARTICIPATIONS IN LETTERS OF CREDIT.
Immediately upon the issuance of each Letter of Credit, each Lender with a
Revolving Loan Commitment shall be deemed to, and hereby agrees to, have
irrevocably purchased from the Issuing Lender a participation in such Letter of
Credit and any drawings honored thereunder in an amount equal to such Lender's
Pro Rata Share of the maximum amount which is or at any time may become
available to be drawn thereunder. Upon satisfaction of the conditions set forth
in Section 4.1, the Letters of Credit set forth on SCHEDULE 3.1C (the "EXISTING
LETTERS OF CREDIT")shall, effective as of such Closing Date, become Letters of
Credit under this Agreement to the same extent as if initially issued hereunder
and each Lender having a Revolving Loan Commitment shall be deemed to have
irrevocably purchased from the Issuing Lender a participation in such Letters of
Credit and drawings thereunder in an amount equal to such Lender's Pro Rata
Share of the maximum amount which is or at any time may become available to be
drawn thereunder.
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CREDIT AGREEMENT
3.2 LETTER OF CREDIT FEES.
Borrowers agree to pay the following amounts with respect to Letters of
Credit issued hereunder:
(i) with respect to each Letter of Credit, (a) a fronting fee,
payable directly to the applicable Issuing Lender for its own account,
equal to 0.25% per annum of the daily amount available to be drawn
under such Letter of Credit, and (b) a letter of credit fee, payable
to Administrative Agent for the account of those Lenders with a
Revolving Loan Commitment, equal to the Applicable LIBOR Margin
multiplied by the daily amount available to be drawn under such Letter
of Credit (without duplication of any amounts required to be paid
under subsection 3.3D(i)), each such fronting fee or letter of credit
fee to be payable in arrears on the last Business Day of each March,
June, September and December of each Fiscal Year commencing on the
first such date to occur after the Closing Date, and on the Revolving
Loan Commitment Termination Date, and computed on the basis of a
360-day year for the actual number of days elapsed; and
(ii) with respect to the issuance, amendment or transfer of each
Letter of Credit and each payment of a drawing made thereunder
(without duplication of the fees payable under clauses (i) and (ii)
above), documentary and processing charges payable directly to the
applicable Issuing Lender for its own account in accordance with such
Issuing Lender's standard schedule for such charges in effect at the
time of such issuance, amendment, transfer or payment, as the case may
be.
For purposes of calculating any fees payable under clauses (i) and (ii) of this
subsection 3.2, the daily amount available to be drawn under any Letter of
Credit shall be determined as of the close of business on any date of
determination. Promptly upon receipt by Administrative Agent of any amount
described in clause (i) or (ii) of this subsection 3.2, Administrative Agent
shall distribute to each Lender with a Revolving Loan Commitment its Pro Rata
Share of such amount. With respect to Existing Letters of Credit, the fees
described in clause (i) above shall accrue from and including the Closing Date.
3.3 DRAWINGS AND REIMBURSEMENT OF AMOUNTS PAID UNDER LETTERS OF CREDIT.
A. RESPONSIBILITY OF ISSUING LENDER WITH RESPECT TO DRAWINGS. In
determining whether to honor any drawing under any Letter of Credit by the
beneficiary thereof, the Issuing Lender shall be responsible only to examine the
documents delivered under such Letter of Credit with reasonable care so as to
ascertain whether they appear on their face to be in accordance with the terms
and conditions of such Letter of Credit.
B. REIMBURSEMENT BY BORROWERS OF AMOUNTS PAID UNDER LETTERS OF CREDIT.
In the event an Issuing Lender has determined to honor a drawing under a Letter
of Credit issued by it, such Issuing Lender shall immediately notify Borrowers
and Administrative Agent, and Borrowers shall reimburse such Issuing Lender on
or before the Business Day immediately following the date on which such drawing
is honored (the "REIMBURSEMENT DATE") in an amount in Dollars and in same day
funds equal to the amount of such honored
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CREDIT AGREEMENT
drawing; PROVIDED that, anything contained in this Agreement to the contrary
notwithstanding, (i) unless Borrowers shall have notified Administrative Agent
and such Issuing Lender prior to 1:00 P.M. (New York City time) on the date such
drawing is honored that Borrowers intends to reimburse such Issuing Lender for
the amount of such honored drawing with funds other than the proceeds of
Revolving Loans, Borrowers shall be deemed to have given a timely Notice of
Borrowing to Administrative Agent requesting Lenders to make Revolving Loans
that are Base Rate Loans on the Reimbursement Date in an amount in Dollars equal
to the amount of such honored drawing and (ii) Lenders shall, on the
Reimbursement Date, make Revolving Loans that are Base Rate Loans in the amount
of such honored drawing (it being understood that such funding of Revolving
Loans by Lenders is not a failure by Borrowers to make payments when due under
subsection 8.1), the proceeds of which shall be applied directly by
Administrative Agent to reimburse such Issuing Lender for the amount of such
honored drawing; and PROVIDED, FURTHER that if for any reason proceeds of
Revolving Loans are not received by such Issuing Lender on the Reimbursement
Date in an amount equal to the amount of such honored drawing, Borrowers shall
reimburse such Issuing Lender, on demand, in an amount in same day funds equal
to the excess of the amount of such honored drawing over the aggregate amount of
such Revolving Loans, if any, which are so received. Nothing in this subsection
3.3B shall be deemed to relieve any Lender from its obligation to make Revolving
Loans on the terms and conditions set forth in this Agreement, and Borrowers
shall retain any and all rights it may have against any Lender resulting from
the failure of such Lender to make such Revolving Loans under this subsection
3.3B.
C. PAYMENT BY LENDERS OF UNREIMBURSED AMOUNTS PAID UNDER LETTERS OF
CREDIT.
(i) PAYMENT BY LENDERS. In the event that Borrowers shall fail
for any reason to reimburse any Issuing Lender as provided in
subsection 3.3B in an amount equal to the amount of any drawing
honored by such Issuing Lender under a Letter of Credit issued by it,
such Issuing Lender shall promptly notify each other Lender with a
Revolving Loan Commitment of the unreimbursed amount of such honored
drawing and of such other Lender's respective participation therein
based on such Lender's Pro Rata Share of the Revolving Loan
Commitment. Each Lender with a Revolving Loan Commitment shall make
available to such Issuing Lender an amount equal to its respective
participation, in Dollars and in same day funds, at the office of such
Issuing Lender specified in such notice, not later than 12:00 Noon
(New York City time) on the first Business Day (under the laws of the
jurisdiction in which such office of such Issuing Lender is located)
after the date notified by such Issuing Lender. In the event that any
Lender with a Revolving Loan Commitment fails to make available to
such Issuing Lender on such Business Day the amount of such Lender's
participation in such Letter of Credit as provided in this subsection
3.3C, such Issuing Lender shall be entitled to recover such amount on
demand from such Lender together with interest thereon at the rate
customarily used by such Issuing Lender for the correction of errors
among banks for three Business Days and thereafter at the Base Rate.
Nothing in this subsection 3.3C shall be deemed to prejudice the right
of any Lender to recover from any Issuing Lender any amounts made
available by such Lender to such Issuing Lender pursuant to this
subsection
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CREDIT AGREEMENT
3.3C in the event that it is determined by the final judgment of a
court of competent jurisdiction that the payment with respect to a
Letter of Credit by such Issuing Lender in respect of which payment
was made by such Lender constituted gross negligence or willful
misconduct on the part of such Issuing Lender.
(ii) DISTRIBUTION TO LENDERS OF REIMBURSEMENTS RECEIVED FROM
BORROWERS. In the event any Issuing Lender shall have been reimbursed
by other Lenders pursuant to subsection 3.3C(i) for all or any portion
of any drawing honored by such Issuing Lender under a Letter of Credit
issued by it, such Issuing Lender shall distribute to each other
Lender with a Revolving Loan Commitment which has paid all amounts
payable by it under subsection 3.3C(i) with respect to such honored
drawing such other Lender's Pro Rata Share of the Revolving Loan
Commitment of all payments subsequently received by such Issuing
Lender from Borrowers in reimbursement of such honored drawing when
such payments are received. Any such distribution shall be made to a
Lender at its primary address set forth below its name on the
appropriate signature page hereof or at such other address as such
Lender may request.
D. INTEREST ON AMOUNTS PAID UNDER LETTERS OF CREDIT.
(i) PAYMENT OF INTEREST BY BORROWERS. Borrowers agree to pay to
each Issuing Lender, with respect to drawings honored under any
Letters of Credit issued by it, interest on the amount paid by such
Issuing Lender in respect of each such honored drawing from the date
such drawing is honored to but excluding the date such amount is
reimbursed by Borrowers (without duplication of any amounts required
to be paid under subsection 3.2(i)) (including any such reimbursement
out of the proceeds of Revolving Loans pursuant to subsection 3.3B) at
a rate equal to (a) for the period from the date such drawing is
honored to but excluding the Reimbursement Date, the rate then in
effect under this Agreement with respect to Revolving Loans that are
Base Rate Loans and (b) thereafter, a rate which is 2.00% per annum in
excess of the rate of interest otherwise payable under this Agreement
with respect to Revolving Loans that are Base Rate Loans. Interest
payable pursuant to this subsection 3.3D(i) shall be computed on the
basis of a 365-day or 366-day year, as the case may be, for the actual
number of days elapsed in the period during which it accrues and shall
be payable on demand or, if no demand is made, on the date on which
the related drawing under a Letter of Credit is reimbursed in full.
(ii) DISTRIBUTION OF INTEREST PAYMENTS BY ISSUING LENDER.
Promptly upon receipt by any Issuing Lender of any payment of interest
pursuant to subsection 3.3D(i) with respect to a drawing honored under
a Letter of Credit issued by it, (a) such Issuing Lender shall
distribute to each other Lender with a Revolving Loan Commitment, out
of the interest received by such Issuing Lender in respect of the
period from the date such drawing is honored to but excluding the date
on which such Issuing Lender is reimbursed for the amount of such
drawing (including any such reimbursement out of the proceeds of
Revolving Loans pursuant to subsection 3.3B), the amount that such
other Lender would have been entitled to receive in respect of the
letter of credit fee that would have been payable in respect of such
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CREDIT AGREEMENT
Letter of Credit for such period pursuant to subsection 3.2 if no
drawing had been honored under such Letter of Credit, and (b) in the
event such Issuing Lender shall have been reimbursed by other Lenders
pursuant to subsection 3.3C(i) for all or any portion of such honored
drawing, such Issuing Lender shall distribute to each other Lender
with a Revolving Loan Commitment which has paid all amounts payable by
it under subsection 3.3C(i) with respect to such honored drawing such
other Lender's Pro Rata Share of the Revolving Loan Commitment of any
interest received by such Issuing Lender in respect of that portion of
such honored drawing so reimbursed by other Lenders for the period
from the date on which such Issuing Lender was so reimbursed by other
Lenders to but excluding the date on which such portion of such
honored drawing is reimbursed by Borrowers. Any such distribution
shall be made to a Lender at its primary address set forth below its
name on the appropriate signature page hereof or at such other address
as such Lender may request.
3.4 OBLIGATIONS ABSOLUTE.
The obligation of Borrowers to reimburse each Issuing Lender for
drawings honored under the Letters of Credit issued by it and to repay any
Revolving Loans made by Lenders pursuant to subsection 3.3B and the obligations
of Lenders under subsection 3.3C(i) shall be unconditional and irrevocable and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances including any of the following circumstances:
(i) any lack of validity or enforceability of any Letter of
Credit;
(ii) the existence of any claim, set-off, defense or other right
which Borrowers or any Lender may have at any time against a
beneficiary or any transferee of any Letter of Credit (or any Persons
for whom any such transferee may be acting), any Issuing Lender or
other Lender or any other Person or, in the case of a Lender, against
Borrowers, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction (including any
underlying transaction between Borrowers or one of their Subsidiaries
and the beneficiary for which any Letter of Credit was procured);
(iii) any draft or other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) payment by the applicable Issuing Lender under any Letter of
Credit against presentation of a draft or other document which does
not substantially comply with the terms of such Letter of Credit;
(v) any adverse change in the business, operations, properties,
assets, condition (financial or otherwise) or prospects of Borrowers
or any of their Subsidiaries;
(vi) any breach of this Agreement or any other Loan Document by
any party thereto;
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CREDIT AGREEMENT
(vii) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing; or
(viii) the fact that an Event of Default or a Potential Event of
Default shall have occurred and be continuing;
PROVIDED, in each case, that payment by the applicable Issuing Lender under the
applicable Letter of Credit shall not have constituted gross negligence or
willful misconduct of such Issuing Lender under the circumstances in question
(as determined by a final judgment of a court of competent jurisdiction).
3.5 INDEMNIFICATION; NATURE OF ISSUING LENDERS' DUTIES.
A. INDEMNIFICATION. In addition to amounts payable as provided in
subsection 3.6, Borrowers hereby agree to protect, indemnify, pay and save
harmless each Issuing Lender from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including reasonable
fees, expenses and disbursements of counsel) which such Issuing Lender may incur
or be subject to as a consequence, direct or indirect, of (i) the issuance of
any Letter of Credit by such Issuing Lender, other than as a result of (a) the
gross negligence or willful misconduct of such Issuing Lender as determined by a
final judgment of a court of competent jurisdiction or (b) subject to the
following clause (ii), the wrongful dishonor by such Issuing Lender of a proper
demand for payment made under any Letter of Credit issued by it or (ii) the
failure of such Issuing Lender to honor a drawing under any such Letter of
Credit as a result of any act or omission, whether rightful or wrongful, of any
present or future de jure or de facto government or governmental authority (all
such acts or omissions herein called "GOVERNMENTAL ACTS").
B. NATURE OF ISSUING LENDERS' DUTIES. As between Borrowers and any
Issuing Lender, Borrowers assume all risks of the acts and omissions of, or
misuse of the Letters of Credit issued by such Issuing Lender by, the respective
beneficiaries of such Letters of Credit. In furtherance and not in limitation of
the foregoing, such Issuing Lender shall not be responsible for: (i) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the application for and issuance of
any such Letter of Credit, even if it should in fact prove to be in any or all
respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the
validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof, in whole or in part, which may prove to
be invalid or ineffective for any reason; (iii) failure of the beneficiary of
any such Letter of Credit to comply fully with any conditions required in order
to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or
delays in transmission or delivery of any messages, by mail, cable, telegraph,
telex or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any such
Letter of Credit or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond the
control of such Issuing Lender,
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CREDIT AGREEMENT
including any Governmental Acts, and none of the above shall affect or impair,
or prevent the vesting of, any of such Issuing Lender's rights or powers
hereunder.
In furtherance and extension and not in limitation of the specific
provisions set forth in the first paragraph of this subsection 3.5B, any action
taken or omitted by any Issuing Lender under or in connection with the Letters
of Credit issued by it or any documents and certificates delivered thereunder,
if taken or omitted in good faith, shall not put such Issuing Lender under any
resulting liability to Borrowers.
Notwithstanding anything to the contrary contained in this subsection
3.5, Borrowers shall retain any and all rights it may have against any Issuing
Lender for any liability arising solely out of the gross negligence or willful
misconduct of such Issuing Lender, as determined by a final judgment of a court
of competent jurisdiction.
3.6 INCREASED COSTS AND TAXES RELATING TO LETTERS OF CREDIT.
Subject to the provisions of subsection 2.7B (which shall be
controlling with respect to the matters covered thereby), in the event that any
Issuing Lender or Lender shall determine (which determination shall, absent
manifest error, be final and conclusive and binding upon all parties hereto)
that any law, treaty or governmental rule, regulation or order, or any change
therein or in the interpretation, administration or application thereof
(including the implementation of any new law, treaty or governmental rule,
regulation or order), or any determination of a court or governmental authority,
in each case that becomes effective after the date hereof, or compliance by any
Issuing Lender or Lender with any guideline, request or directive issued or made
after the date hereof by any central bank or other governmental or
quasi-governmental authority (whether or not having the force of law):
(i) subjects such Issuing Lender or Lender (or its applicable
lending or letter of credit office) to any additional Tax (other than
any Tax on the overall net income of such Issuing Lender or Lender)
with respect to the issuing or maintaining of any Letters of Credit or
the purchasing or maintaining of any participations therein or any
other obligations under this Section 3, whether directly or by such
being imposed on or suffered by any particular Issuing Lender;
(ii) imposes, modifies or holds applicable any reserve (including
any marginal, emergency, supplemental, special or other reserve),
special deposit, compulsory loan, FDIC insurance or similar
requirement in respect of any Letters of Credit issued by any Issuing
Lender or participations therein purchased by any Lender; or
(iii) imposes any other condition (other than with respect to a
Tax matter) on or affecting such Issuing Lender or Lender (or its
applicable lending or letter of credit office) regarding this Section
3 or any Letter of Credit or any participation therein;
and the result of any of the foregoing is to increase the cost to such Issuing
Lender or Lender of agreeing to issue, issuing or maintaining any Letter of
Credit or agreeing to purchase,
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CREDIT AGREEMENT
purchasing or maintaining any participation therein or to reduce any amount
received or receivable by such Issuing Lender or Lender (or its applicable
lending or letter of credit office) with respect thereto; then, in any case,
Borrowers shall promptly pay to such Issuing Lender or Lender, upon receipt of
the statement referred to in the next sentence, such additional amount or
amounts as may be necessary to compensate such Issuing Lender or Lender for any
such increased cost or reduction in amounts received or receivable hereunder.
Such Issuing Lender or Lender shall deliver to Borrowers a written statement,
setting forth in reasonable detail the basis for calculating the additional
amounts owed to such Issuing Lender or Lender under this subsection 3.6, which
statement shall be conclusive and binding upon all parties hereto absent
manifest error.
SECTION 4. CONDITIONS TO LOANS AND LETTERS OF CREDIT
The obligations of Lenders to make Loans and the issuance of Letters of
Credit hereunder are subject to the satisfaction of the following conditions.
4.1 CONDITIONS TO TERM LOAN AND INITIAL REVOLVING LOANS.
The obligations of Lenders to make the Term Loan and any Revolving
Loans to be made on the Closing Date are, in addition to the conditions
precedent specified in subsection 4.2, subject to prior or concurrent
satisfaction of the following conditions:
A. LOAN PARTY DOCUMENTS. On or before the Closing Date, Borrowers
shall, and shall cause each wholly-owned Subsidiary (and each other Subsidiary
which may execute a Loan Document without violating any provision of such
Subsidiary's organizational documents or other agreement or instrument to which
such Subsidiary is a party) to, deliver to Lenders (or to Administrative Agent
for Lenders with sufficient originally executed copies, where appropriate, for
each Lender and its counsel) the following with respect to Borrowers or such
Loan Party, as the case may be, each, unless otherwise noted, dated the Closing
Date:
(i) Certified copies of the Certificate or Articles of
Incorporation or similar formation documents of such Person, together
with a good standing certificate from the Secretary of State of its
jurisdiction of incorporation and each other state in which such
Person is qualified as a foreign corporation to do business and, to
the extent generally available, a certificate or other evidence of
good standing as to payment of any applicable franchise or similar
taxes from the appropriate taxing authority of each of such
jurisdictions, each dated a recent date prior to the Closing Date;
(ii) Copies of the Bylaws or other similar organizational
documents of such Person, certified as of the Closing Date by such
Person's corporate secretary or an assistant secretary;
(iii) Resolutions of the Board of Directors or other similar
governing body of such Person approving and authorizing the execution,
delivery and performance of the Loan Documents to which it is a party,
certified as of the Closing Date by the
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CREDIT AGREEMENT
corporate secretary or an assistant secretary of such Person as being
in full force and effect without modification or amendment;
(iv) Signature and incumbency certificates of the officers of
such Person executing the Loan Documents to which it is a party;
(v) Executed originals of the Loan Documents to which such Person
is a party; and
(vi) Such other documents as Administrative Agent may reasonably
request.
B. NO MATERIAL ADVERSE EFFECT. Since December 31, 2000, no event has
occurred which in the reasonable opinion of the Co-Lead Arrangers is likely to
cause a Material Adverse Effect.
C. CORPORATE AND CAPITAL STRUCTURE, OWNERSHIP, ASSET DISPOSITION.
(i) CORPORATE STRUCTURE. The corporate organizational structure
of Borrowers and their Subsidiaries shall be in all material respects
as set forth on SCHEDULE 4.1C annexed hereto, and shall be
satisfactory to Administrative Agent and Co-Lead Arrangers.
(ii) CAPITAL STRUCTURE AND OWNERSHIP. The capital structure and
ownership of Borrowers shall be in all material respects as set forth
on SCHEDULE 4.1C, and shall be satisfactory to Administrative Agent
and Co-Lead Arrangers.
D. TERMINATION OF EXISTING CREDIT AGREEMENTS AND RELATED LIENS;
EXISTING LETTERS OF CREDIT. On the Closing Date, Borrowers and their
Subsidiaries shall have (a) repaid in full all outstanding Indebtedness of
Borrowers and their Subsidiaries under the Existing Credit Agreement, (b)
terminated any commitments to lend or make other extensions of credit
thereunder, (c) delivered to Administrative Agent all documents or instruments
necessary to release all Liens securing Indebtedness or other obligations of
Borrowers and their Subsidiaries thereunder, and (d) with respect to any letters
of credit under the Existing Credit Agreement which will not be Existing Letters
of Credit under this Agreement, made arrangements reasonably satisfactory to
Administrative Agent with respect to the cancellation of any letters of credit
outstanding thereunder or the issuance of Letters of Credit to support the
obligations of Borrowers and their Subsidiaries with respect thereto.
E. NECESSARY GOVERNMENTAL AUTHORIZATIONS AND CONSENTS; EXPIRATION OF
WAITING PERIODS, ETC. Borrowers shall have obtained all Governmental
Authorizations and all consents of other Persons, in each case that are
necessary in connection with the transactions contemplated by the Loan
Documents, and the continued operation of the business conducted by Borrowers
and their Subsidiaries in substantially the same manner as currently conducted,
and each of the foregoing shall be in full force and effect, in each case other
than those the failure to obtain or maintain which, either individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect. All applicable waiting periods shall have expired without any action
being taken or threatened
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CREDIT AGREEMENT
by any competent authority which would restrain, prevent or otherwise impose
adverse conditions on the financing. No action, request for stay, petition for
review or rehearing, reconsideration, or appeal with respect to any of the
foregoing shall be pending, and the time for any applicable agency to take
action to set aside its consent on its own motion shall have expired.
F. SECURITY INTERESTS IN PERSONAL AND MIXED PROPERTY. Administrative
Agent shall have received evidence satisfactory to it that Borrowers and
Subsidiary Guarantors shall have taken or caused to be taken all such actions,
executed and delivered or caused to be executed and delivered all such
agreements, documents and instruments, and made or caused to be made all such
filings and recordings (other than the filing or recording of items described in
clauses (iii), (iv) and (v) below) that may be necessary or, in the opinion of
Administrative Agent, desirable in order to create in favor of Administrative
Agent, for the benefit of Lenders and the holders of the Senior Notes required
to be equally and ratably secured with the Lenders, a valid and (upon such
filing and recording) perfected First Priority security interest in the
Collateral. Such actions shall include the following:
(i) SCHEDULES TO THE COLLATERAL DOCUMENTS. Delivery to
Administrative Agent of accurate and complete schedules to all of the
applicable the Collateral Documents;
(ii) STOCK CERTIFICATES; INSTRUMENTS; AND PROMISSORY NOTES.
Delivery to Administrative Agent of (a) certificates (which
certificates shall be accompanied by irrevocable undated stock powers,
duly endorsed in blank and otherwise satisfactory in form and
substance to Administrative Agent) representing all capital stock
pledged pursuant to the Pledge Agreement, (b) all promissory notes or
other instruments (duly endorsed, where appropriate, in a manner
satisfactory to Administrative Agent) evidencing any Collateral; and
(c) all notes, endorsements in blank and other documentation required
to pledge the Mortgage Loans (as such term is defined in the Pledge
Agreement) pursuant to the Pledge Agreement;
(iii) LIEN SEARCHES AND UCC TERMINATION STATEMENTS. Delivery to
Administrative Agent of (a) the results of a recent search, by a
Person satisfactory to Administrative Agent, of all effective UCC
financing statements which may have been made with respect to the
jurisdiction of formation or organization of any Loan Party and the
headquarters of any Loan Party, together with copies of all such
filings disclosed by such search, and (b) UCC termination statements
duly executed by all applicable Persons for filing in all applicable
jurisdictions as may be necessary to terminate any effective UCC
financing statements or fixture filings disclosed in such search
(other than any such financing statements or fixture filings in
respect of Liens permitted to remain outstanding pursuant to the terms
of this Agreement); and
(iv) UCC FINANCING STATEMENTS. Delivery to Administrative Agent
of UCC financing statements, duly executed by each applicable Loan
Party with respect to all Collateral of such Loan Party, for filing in
all jurisdictions as may be necessary or, in the opinion of
Administrative Agent, desirable to perfect the security interests
created in such Collateral pursuant to the Collateral Documents.
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CREDIT AGREEMENT
G. RESERVED.
H. FINANCIAL STATEMENTS. On or before the Closing Date, Lenders shall
have received from Borrowers (i) audited financial statements of Borrowers and
their Subsidiaries for Fiscal Years 1999 and 2000, consisting of balance sheets
and the related consolidated and consolidating statements of income,
stockholders' equity and cash flows for such Fiscal Years, and (ii) unaudited
financial statements of Borrowers and their Subsidiaries as at March 31 2001,
consisting of a balance sheet and the related consolidated and consolidating
statements of income, stockholders' equity and cash flows for the three-month
period ending on such date, all in reasonable detail and certified by the chief
financial officer of Borrowers that they fairly present the financial condition
of Borrowers and their Subsidiaries as at the dates indicated and the results of
their operations and their cash flows for the periods indicated, subject to the
absence of footnotes and changes resulting from audit and normal year-end
adjustments.
I. EVIDENCE OF INSURANCE. Administrative Agent shall have received a
certificate from Borrowers' insurance broker or other evidence satisfactory to
it that all insurance required to be maintained pursuant to subsection 6.4 is in
full force and effect.
J. OPINIONS OF COUNSEL TO LOAN PARTIES. Lenders and their respective
counsel shall have received originally executed copies of a favorable written
opinion of Goodwin Procter LLP, counsel for Loan Parties, in form and substance
reasonably satisfactory to Administrative Agent and its counsel, dated as of the
Closing Date and setting forth substantially the matters in the opinion
designated in EXHIBIT VII and as to such other matters as Administrative Agent
acting on behalf of Lenders may reasonably request and (ii) evidence
satisfactory to Administrative Agent that Borrowers has requested such counsel
to deliver such opinions to Lenders.
K. OPINIONS OF ADMINISTRATIVE AGENT'S COUNSEL. Lenders shall have
received originally executed copies of one or more favorable written opinions of
O'Melveny & Myers LLP, counsel to Administrative Agent, dated as of the Closing
Date, substantially in the form of EXHIBIT VIII annexed hereto and as to such
other matters as Administrative Agent acting on behalf of Lenders may reasonably
request.
L. FEES. Borrowers shall have paid to Administrative Agent, for
distribution (as appropriate) to Administrative Agent and Lenders, the fees
payable on the Closing Date referred to in subsection 2.3 and the reasonable
fees, costs and expenses of counsel to Administrative Agent.
M. REPRESENTATIONS AND WARRANTIES; PERFORMANCE OF AGREEMENTS. Borrowers
shall have delivered to Administrative Agent an Officers' Certificate, in form
and substance satisfactory to Administrative Agent, to the effect that the
representations and warranties in Section 5 hereof are true, correct and
complete in all material respects on and as of the Closing Date to the same
extent as though made on and as of that date (or, to the extent such
representations and warranties specifically relate to an earlier date, that such
representations and warranties were true, correct and complete in all material
respects on and as of such earlier date) and that Borrowers shall have performed
in all material respects all
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CREDIT AGREEMENT
agreements and satisfied all conditions which this Agreement provides shall be
performed or satisfied by it on or before the Closing Date except as otherwise
disclosed to and agreed to in writing by Administrative Agent and Requisite
Lenders.
N. COMPLETION OF PROCEEDINGS. All corporate and other proceedings taken
or to be taken in connection with the transactions contemplated hereby and all
documents incidental thereto not previously found acceptable by Administrative
Agent, acting on behalf of Lenders, and its counsel shall be satisfactory in
form and substance to Administrative Agent and such counsel, and Administrative
Agent and such counsel shall have received all such counterpart originals or
certified copies of such documents as Administrative Agent may reasonably
request.
O. NO DISRUPTION OF FINANCIAL MARKETS. There shall have not occurred
any material adverse change in the financial markets after December 31, 2000, as
determined by Administrative Agent in its sole discretion.
P. SOLVENCY ASSURANCES. On the Closing Date, Administrative Agent and
Lenders shall have received an Officers' Certificate executed by the chief
financial officer of Borrowers, dated the Closing Date, substantially in the
form of EXHIBIT X and with appropriate attachments, demonstrating that, after
giving effect to the consummation of the Refinancing and the other transactions
contemplated by this Agreement, Borrowers and their Subsidiaries, taken as a
whole, will be Solvent.
Q. FINANCIAL COVENANTS. On the Closing Date, Administrative Agent shall
have received an Officers' Certificate executed by the chief financial officer
of Borrowers, dated the Closing Date, with appropriate attachments,
demonstrating that, after giving effect to the consummation of the Refinancing
and the other transactions contemplated by this Agreement, the Borrowers shall
be in compliance with (i) the financial covenants set forth in subsection 7.6
(provided that with respect to subsection 7.6B, such Lodging EBITDA shall be set
forth separately for each Fiscal Quarter included in the period for which the
determination is being made), and (ii) the restrictions in the Senior Note
Documents with respect to the amount of Indebtedness and secured Indebtedness
permitted to be incurred by the Borrowers as of the Closing Date, with such
detail and supporting calculations therefor as reasonably required by
Administrative Agent.
4.2 CONDITIONS TO ALL LOANS.
The obligations of Lenders to make Loans on each Funding Date are
subject to the following further conditions precedent:
A. Administrative Agent shall have received before that Funding Date,
in accordance with the provisions of subsection 2.1B, an originally executed
Notice of Borrowing, in each case signed by the chief executive officer, the
chief financial officer or the treasurer of Borrowers or any other person
designated in writing by any of the above described officers by or on behalf of
Borrowers in a writing delivered to Administrative Agent.
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CREDIT AGREEMENT
B. As of that Funding Date:
(i) The representations and warranties contained herein and in
the other Loan Documents shall be true, correct and complete in all
material respects on and as of that Funding Date to the same extent as
though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date,
in which case such representations and warranties shall have been
true, correct and complete in all material respects on and as of such
earlier date; PROVIDED, that where a representation and warranty is
already qualified as to materiality, such materiality qualifier shall
be disregarded for purposes of this provision;
(ii) No event shall have occurred and be continuing or would
result from the consummation of the borrowing contemplated by such
Notice of Borrowing that would constitute an Event of Default or a
Potential Event of Default;
(iii) Each Loan Party shall have performed in all material
respects all agreements and satisfied all conditions which this
Agreement provides shall be performed or satisfied by it on or before
that Funding Date;
(iv) No order, judgment or decree of any court, arbitrator or
governmental authority shall purport to enjoin or restrain any Lender
from making the Loans to be made by it on that Funding Date;
(v) The making of the Loans requested on such Funding Date shall
not violate any law including Regulation T, Regulation U or Regulation
X of the Board of Governors of the Federal Reserve System; and
(vi) There shall not be pending or, to the knowledge of
Borrowers, threatened, any action, suit, proceeding, governmental
investigation or arbitration against or affecting Borrowers or any of
their Subsidiaries or any property of Borrowers or any of their
Subsidiaries that has not been disclosed by Borrowers in writing
pursuant to subsection 5.6 or 6.1(viii) prior to the making of the
last preceding Loans (or, in the case of the initial Loans, prior to
the execution of this Agreement), and there shall have occurred no
development not so disclosed in any such action, suit, proceeding,
governmental investigation or arbitration so disclosed, that, in
either event, in the opinion of Administrative Agent or of Requisite
Lenders, could reasonably be expected to have a Material Adverse
Effect; and no injunction or other restraining order shall have been
issued and no hearing to cause an injunction or other restraining
order to be issued shall be pending or noticed with respect to any
action, suit or proceeding seeking to enjoin or otherwise prevent the
consummation of, or to recover any damages or obtain relief as a
result of, the transactions contemplated by this Agreement or the
making of Loans hereunder.
4.3 CONDITIONS TO LETTERS OF CREDIT.
The issuance of any Letter of Credit hereunder (whether or not the
applicable Issuing Lender is obligated to issue such Letter of Credit) is
subject to the following conditions precedent:
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CREDIT AGREEMENT
A. On or before the date of issuance of the initial Letter of Credit
pursuant to this Agreement, the initial Loans shall have been made.
B. On or before the date of issuance of such Letter of Credit,
Administrative Agent shall have received, in accordance with the provisions of
subsection 3.1B(i), a Notice of Issuance of Letter of Credit, in each case
signed by the chief executive officer, the chief financial officer or the
treasurer of Borrowers or by any executive officer of Borrowers designated by
any of the above-described officers on behalf of Borrowers in a writing
delivered to Administrative Agent, together with all other information specified
in subsection 3.1B(i) and such other documents or information as the applicable
Issuing Lender may reasonably require in connection with the issuance of such
Letter of Credit.
On the date of issuance of such Letter of Credit, all conditions
precedent described in subsection 4.2B shall be satisfied to the same extent as
if the issuance of such Letter of Credit were the making of a Loan and the date
of issuance of such Letter of Credit were a Funding Date.
SECTION 5. BORROWERS' REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Agreement and to make the
Loans, to induce Issuing Lenders to issue Letters of Credit and to induce other
Lenders to purchase participations therein, Borrowers represent and warrant to
each Lender, on the date of this Agreement, on each Funding Date and on the date
of issuance of each Letter of Credit, that the following statements are true,
correct and complete:
5.1 ORGANIZATION, POWERS, QUALIFICATION, GOOD STANDING, BUSINESS AND
SUBSIDIARIES.
A. ORGANIZATION AND POWERS. Each Loan Party is duly organized, validly
existing and in good standing under the laws of its jurisdiction of formation or
organization as specified in SCHEDULE 5.1 annexed hereto except where the
failure to be so organized, existing and in good standing could not reasonably
be expected to have a Material Adverse Effect. Each Loan Party has all requisite
corporate, partnership or limited liability company power and authority, as
applicable, to own and operate its properties, to carry on its business as now
conducted and as proposed to be conducted, to enter into the Loan Documents to
which it is a party and to carry out the transactions contemplated thereby
except where the failure to have such power and authority could not reasonably
be expected to have a Material Adverse Effect.
B. QUALIFICATION AND GOOD STANDING. Each Loan Party is qualified to do
business and in good standing in every jurisdiction where its assets are located
and wherever necessary to carry out its business and operations, except in
jurisdictions where the failure to be so qualified or in good standing has not
had and could not reasonably be expected to have a Material Adverse Effect.
C. CONDUCT OF BUSINESS. Borrowers and their Subsidiaries are engaged
only in the businesses permitted to be engaged in pursuant to subsection 7.10.
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CREDIT AGREEMENT
D. SUBSIDIARIES. All of the Subsidiaries of Borrowers are identified in
SCHEDULE 5.1 annexed hereto, as said SCHEDULE 5.1 may be supplemented from time
to time pursuant to the provisions of subsection 6.1(xiv). The capital stock of
each of the Subsidiaries of Borrowers identified in SCHEDULE 5.1 annexed hereto
(as so supplemented) is duly authorized, validly issued, fully paid and
nonassessable and none of such capital stock constitutes Margin Stock except
where any failure of the same could not be reasonably expected to have a
Material Adverse Effect. Each of the Subsidiaries of Borrowers identified in
SCHEDULE 5.1 annexed hereto (as so supplemented) is a corporation, partnership
or limited liability company duly organized or formed, validly existing and in
good standing under the laws of its respective jurisdiction of incorporation set
forth therein, has all requisite corporate power, partnership or limited
liability company and authority to own and operate its properties and to carry
on its business as now conducted and as proposed to be conducted, and is
qualified to do business and in good standing in every jurisdiction where its
assets are located and wherever necessary to carry out its business and
operations; in each case except where failure to be so qualified or in good
standing or a lack of such corporate power, partnership or limited liability
company and authority has not had and could not reasonably be expected to have a
Material Adverse Effect. SCHEDULE 5.1 annexed hereto (as so supplemented)
correctly sets forth in all material respects the ownership interest of
Borrowers and each of their Subsidiaries in each of the Subsidiaries of
Borrowers identified therein.
5.2 AUTHORIZATION OF BORROWING, ETC.
A. AUTHORIZATION OF BORROWING. The execution, delivery and performance
of the Loan Documents have been duly authorized by all necessary corporate
action on the part of each Loan Party that is a party thereto.
B. NO CONFLICT. The execution, delivery and performance by Loan Parties
of the Loan Documents to which they are parties and the consummation of the
transactions contemplated by the Loan Documents do not and will not (i) violate
any provision of any law or any governmental rule or regulation applicable to
Borrowers or any of their Subsidiaries, the Certificate or Articles of
Incorporation or Bylaws of Borrowers or any of their Subsidiaries or any order,
judgment or decree of any court or other agency of government binding on
Borrowers or any of their Subsidiaries, (ii) conflict with, result in a breach
of or constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Borrowers or any of their Subsidiaries, (iii) result
in or require the creation or imposition of any Lien upon any of the properties
or assets of Borrowers or any of their Subsidiaries (other than any Liens
created under any of the Loan Documents in favor of Administrative Agent on
behalf of Lenders and the Senior Notes), or (iv) require any approval of
stockholders or any approval or consent of any Person under any Contractual
Obligation of Borrowers or any of their Subsidiaries, except for such approvals
or consents which will be obtained on or before the Closing Date and disclosed
in writing to Lenders and except where the failure to obtain such approvals or
consent, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.
C. GOVERNMENTAL CONSENTS. The execution, delivery and performance by
Loan Parties of the Loan Documents to which they are parties and the
consummation of the
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CREDIT AGREEMENT
transactions contemplated by the Loan Documents and such do not and will not
require any registration with, consent or approval of, or notice to, or other
action to, with or by, any federal, state or other governmental authority or
regulatory body and except where, individually or in the aggregate, the failure
to register with, obtain consent or approval of, or provide notice could not
reasonably be expected to have a Material Adverse Effect.
D. BINDING OBLIGATION. Each of the Loan Documents has been duly
executed and delivered by each Loan Party that is a party thereto and is the
legally valid and binding obligation of such Loan Party, enforceable against
such Loan Party in accordance with its respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
relating to or limiting creditors' rights generally or by equitable principles
relating to enforceability.
5.3 FINANCIAL CONDITION.
Borrowers have heretofore delivered, or caused to be delivered, to
Lenders, at Lenders' request, the following financial statements and
information: (i) the audited consolidated balance sheet of Borrowers and their
Subsidiaries as at December 31, 2000 and December 31, 1999 and the related
consolidated statements of income, stockholders' equity and cash flows of
Borrowers and their Subsidiaries for the Fiscal Years then ended, and (ii) the
unaudited consolidated balance sheet of Borrowers and their Subsidiaries as at
March 31, 2001 and the related unaudited consolidated statements of income and
cash flows of Borrowers and their Subsidiaries for the three months then ended.
All such statements were prepared in conformity with GAAP and fairly present, in
all material respects, the financial position (on a consolidated basis) of the
entities described in such financial statements as at the respective dates
thereof and the results of operations and cash flows (on a consolidated basis)
of the entities described therein for each of the periods then ended, subject,
in the case of any such unaudited financial statements, to the absence of
footnotes and to changes resulting from audit and normal year-end adjustments.
Borrowers do not (and will not following the funding of the initial Loans) have
any Contingent Obligation, contingent liability or liability for taxes,
long-term lease or unusual forward or long-term commitment that is not reflected
in the foregoing financial statements or the notes thereto or which has not
otherwise been disclosed to Administrative Agent and approved by Administrative
Agent, such approval not to be unreasonably withheld, and which in any such case
(but excluding, in all events, any and all such Contingent Obligations and other
liabilities between and among Borrowers and the Subsidiary Guarantors) is
material in relation to the business, operations, properties, assets, financial
condition or prospects of Borrowers or any of their Subsidiaries, taken as a
whole.
5.4 NO MATERIAL ADVERSE CHANGE; NO RESTRICTED PAYMENTS.
Since December 31, 2000, no event or change has occurred that has
caused or evidences, either in any case or in the aggregate, a Material Adverse
Effect.
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CREDIT AGREEMENT
5.5 TITLE TO PROPERTIES; LIENS; REAL PROPERTY.
A. TITLE TO PROPERTIES; LIENS. Borrowers and their Subsidiaries have
(i) good, sufficient and legal title to (in the case of fee interests in real
property), (ii) valid leasehold interests in (in the case of leasehold interests
in real or personal property), or (iii) good title to (in the case of all other
personal property), all of their respective properties and assets reflected in
the financial statements referred to in subsection 5.3 or in the most recent
financial statements delivered pursuant to subsection 6.1, in each case except
for assets disposed of since the date of such financial statements in the
ordinary course of business or as otherwise permitted under subsection 7.7
except in cases, individually or in the aggregate, where any such title defects
could not reasonably be expected to have a Material Adverse Effect.
B. REAL PROPERTY. As of the Closing Date, SCHEDULE 5.5B annexed hereto
contains a true, accurate and complete list of all fee interests in any Real
Property Assets. Except as specified in SCHEDULE 5.5B annexed hereto, all of the
leases, subleases or assignments of leases affecting any such Real Property
Asset are in full force and effect and Borrowers do not have knowledge of any
default that has occurred and is continuing thereunder, and each such agreement
constitutes the legally valid and binding obligation of each applicable Loan
Party, enforceable against such Loan Party in accordance with its terms, except
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles and except for such defaults as could not reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect.
C. INTELLECTUAL PROPERTY. As of the Closing Date, Borrowers and their
Subsidiaries own or have the right to use, all Intellectual Property used in the
conduct of their business, except where the failure to own or have such right to
use in the aggregate could not reasonably be expected to result in a Material
Adverse Effect. No claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does Borrowers
know of any valid basis for any such claim except for such claims that in the
aggregate could not reasonably be expected to result in a Material Adverse
Effect. The use of such Intellectual Property by Borrowers and their
Subsidiaries does not infringe on the rights of any Person, except for such
claims and infringements that, in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect.
5.6 LITIGATION; ADVERSE FACTS.
Except as set forth in SCHEDULE 5.6 annexed hereto, there are no
actions, suits, proceedings, arbitrations or governmental investigations
(whether or not purportedly on behalf of Borrowers or any of their Subsidiaries)
at law or in equity, or before or by any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign (including any Environmental Claims) that are pending or, to
the knowledge of Borrowers, threatened against or affecting Borrowers or any of
their Subsidiaries or any property of Borrowers or any of their Subsidiaries and
that, individually or in the aggregate, could reasonably be expected to result
in a Material Adverse
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CREDIT AGREEMENT
Effect. Neither of the Borrowers nor any of their Subsidiaries (i) are in
violation of any applicable laws (including Environmental Laws) that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect, or (ii) are subject to or in default with respect to
any final judgments, writs, injunctions, decrees, rules or regulations of any
court or any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign, that,
individually or in the aggregate, could reasonably be expected to result in a
Material Adverse Effect.
5.7 PAYMENT OF TAXES.
Except to the extent permitted by subsection 6.3, all tax returns and
reports of Borrowers and their Subsidiaries required to be filed by any of them
have been timely filed, and all taxes shown on such tax returns to be due and
payable and all assessments, fees and other governmental charges upon Borrowers
and their Subsidiaries and upon their respective properties, assets, income,
businesses and franchises which are due and payable have been paid when due and
payable except where, individually or in the aggregate, the failure to so file
and/or pay could not reasonably be expected to have a Material Adverse Effect.
Borrowers know of no proposed material tax assessment against Borrowers or any
of their Subsidiaries, the imposition of which could reasonably be expected to
have a Material Adverse Effect, that is not being actively contested by
Borrowers or such Subsidiary in good faith and by appropriate proceedings;
PROVIDED that such reserves or other appropriate provisions, if any, as shall be
required in conformity with GAAP shall have been made or provided therefor.
5.8 PERFORMANCE OF AGREEMENTS; MATERIALLY ADVERSE AGREEMENTS; MATERIAL
CONTRACTS.
A. Neither of the Borrowers nor any of their Subsidiaries are in
default in the performance, observance or fulfillment of any of the obligations,
covenants or conditions contained in any of its Contractual Obligations, and no
condition exists that, with the giving of notice or the lapse of time or both,
would constitute such a default, except where the consequences, direct or
indirect, of such default or defaults, if any, would not have a Material Adverse
Effect.
B. Neither of the Borrowers nor any of their Subsidiaries are a party
to or is otherwise subject to any agreements or instruments or any charter or
other internal restrictions which, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.
C. Except as set forth on Schedule 5.8C, all Material Contracts are in
full force and effect and no defaults currently exist thereunder, except for
defaults which, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.
5.9 GOVERNMENTAL REGULATION.
Neither of the Borrowers nor any of their Subsidiaries are subject to
regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, the Interstate Commerce Act or the Investment Company Act of 1940 or
under any other federal or state
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CREDIT AGREEMENT
statute or regulation which may limit its ability to incur Indebtedness or which
may otherwise render all or any portion of the Obligations unenforceable.
5.10 SECURITIES ACTIVITIES.
Neither of the Borrowers nor any of their Subsidiaries are engaged
principally, or as one of their important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin Stock. No
part of the proceeds of any Loan will be used by the Borrowers to purchase or
carry any Margin Stock or to extend credit to others for the purpose of
purchasing or carrying any Margin Stock. Neither the making of any Loan nor the
use of the proceeds thereof will violate or be inconsistent with the provisions
of Regulations T, U or X of the Federal Reserve Board.
5.11 EMPLOYEE BENEFIT PLANS.
Borrowers are in the process of terminating certain Employee Benefit
Plans, Multiemployer Plans and other Pension Plans currently maintained by
Borrowers and their Subsidiaries. Until such termination, Borrowers represent
and warrant (PROVIDED that in the event that Borrowers or their Subsidiaries
re-establish any such Employee Benefit Plans, Multiemployer Plans or other
Pension Plans, such representation and warranty shall be reinstated) that except
as could not reasonably be expected to have a Material Adverse Effect:
A. Borrowers, each of their Subsidiaries and each of their respective
ERISA Affiliates are in compliance in all material respects with all applicable
provisions and requirements of ERISA and the regulations and published
interpretations thereunder with respect to each Employee Benefit Plan (if any),
and have performed all their obligations under each Employee Benefit Plan in all
material respects. Any proposed termination of an Employee Benefit Plan shall be
conducted in accordance with all applicable ERISA requirements. Each Employee
Benefit Plan (if any) that is intended to qualify under Section 401(a) of the
Internal Revenue Code is so qualified;
B. No ERISA Event has occurred or is reasonably expected to occur;
C. Except to the extent required under Section 4980B of the Internal
Revenue Code or except as set forth in SCHEDULE 5.11 annexed hereto, no Employee
Benefit Plan (if any) provides health or welfare benefits (through the purchase
of insurance or otherwise) for any retired or former employee of Borrowers, any
of their Subsidiaries or any of their respective ERISA Affiliates;
D. As of the most recent valuation date for any Pension Plan, the
amount of unfunded benefit liabilities (as defined in Section 4001(a)(18) of
ERISA), individually or in the aggregate for all Pension Plans (excluding for
purposes of such computation any Pension Plans with respect to which assets
exceed benefit liabilities) is not material; and
E. As of the most recent valuation date for each Multiemployer Plan (if
any) for which the actuarial report is available, Borrowers and their
Subsidiaries and their respective
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CREDIT AGREEMENT
ERISA Affiliates have no potential liability for a complete withdrawal from such
Multiemployer Plans (within the meaning of Section 4203 of ERISA).
5.12 NO BROKER'S FEES.
No broker's or finder's fee or commission will be payable with respect
to this Agreement or any of the transactions contemplated hereby, and Borrowers
hereby indemnifies Lenders against, and agrees that it will hold Lenders
harmless from, any claim, demand or liability for any such broker's or finder's
fees alleged to have been incurred in connection herewith or therewith and any
expenses (including reasonable fees, expenses and disbursements of counsel)
arising in connection with any such claim, demand or liability.
5.13 ENVIRONMENTAL PROTECTION.
Except as set forth in SCHEDULE 5.13 annexed hereto:
(i) Neither of the Borrowers nor any of their Subsidiaries nor
any of their respective Real Property Assets or operations are subject
to any outstanding written order, consent decree or settlement
agreement with any Person relating to (a) any Environmental Law, (b)
any Environmental Claim, or (c) any Hazardous Materials Activity that,
individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect;
(ii) Neither of the Borrowers nor any of their Subsidiaries have
received any letter or request for information under Section 104 of
the Comprehensive Environmental Response, Compensation, and Liability
Act (42 U.S.C. ss. 9604) or any comparable state law that,
individually or in the aggregate, could reasonably be expected to have
a Material Adverse Effect;
(iii) there are and, to Borrowers' knowledge, have been no
conditions, occurrences, or Hazardous Materials Activities which could
reasonably be expected to form the basis of an Environmental Claim
against Borrowers or any of their Subsidiaries that, individually or
in the aggregate, could reasonably be expected to have a Material
Adverse Effect; and
(iv) compliance with all current or reasonably foreseeable future
requirements pursuant to or under Environmental Laws could not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Notwithstanding anything in this subsection 5.13 to the contrary, no
event or condition has occurred or is occurring with respect to Borrowers or any
of their Subsidiaries relating to any Environmental Law, any Release of
Hazardous Materials, or any Hazardous Materials Activity, including any matter
disclosed on SCHEDULE 5.13 annexed hereto, which individually or in the
aggregate, has had or could reasonably be expected to have a Material Adverse
Effect.
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CREDIT AGREEMENT
5.14 EMPLOYEE MATTERS.
There is no strike or work stoppage in existence or threatened
involving Borrowers or any of their Subsidiaries that could reasonably be
expected to have a Material Adverse Effect, and there are no strikes or walkouts
in progress, pending or to Borrowers' knowledge contemplated relating to any
labor contracts to which Borrowers or any of their Subsidiaries are a party,
relating to any labor contracts being negotiated, or otherwise that,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
5.15 SOLVENCY.
The Loan Parties, taken as a whole, are and, upon the incurrence of any
Obligations by the Loan Parties on any date on which this representation is
made, will be, Solvent.
5.16 MATTERS RELATING TO COLLATERAL.
A. CREATION, PERFECTION AND PRIORITY OF LIENS. The execution and
delivery of the Collateral Documents by Loan Parties, together with (i) the
actions taken on or prior to the Closing Date pursuant to subsection 4.1F and to
be taken after the Closing Date pursuant to subsection 6.8 and (ii) the delivery
to Administrative Agent of any Pledged Collateral not delivered to
Administrative Agent at the time of execution and delivery of the applicable
Collateral Document, in accordance with subsection 6.8 are (or will be with
respect to Collateral required to be delivered after the Closing Date, in
accordance with subsection 6.8) effective to create in favor of Administrative
Agent for the benefit of Lenders, as security for the respective Secured
Obligations (as defined in the applicable Collateral Document in respect of any
Collateral), a valid and perfected First Priority Lien on all of the Collateral
(except to the extent disclosed in the applicable Collateral Document), and all
filings and other actions necessary or desirable to perfect and maintain the
perfection and First Priority status of such Liens have been duly made or taken
and remain in full force and effect, other than the filing of any UCC financing
statements delivered to Administrative Agent for filing (but not yet filed) and
the periodic filing of UCC continuation statements in respect of UCC financing
statements filed by or on behalf of Administrative Agent.
B. GOVERNMENTAL AUTHORIZATIONS. No authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for either (i) the pledge or grant by any Loan Party
of the Liens purported to be created in favor of Administrative Agent pursuant
to any of the Collateral Documents or (ii) the exercise by Administrative Agent
of any rights or remedies in respect of any Collateral (whether specifically
granted or created pursuant to any of the Collateral Documents or created or
provided for by applicable law), except for filings or recordings contemplated
by subsection 5.16A and except as may be required, in connection with the
disposition of any Pledged Collateral, by laws generally affecting the offering
and sale of Securities.
C. ABSENCE OF THIRD-PARTY FILINGS. Except such as may have been filed
in favor of Administrative Agent as contemplated by subsection 5.16A, no
effective UCC financing statement, fixture filing or other instrument similar in
effect covering all or any
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CREDIT AGREEMENT
part of the Collateral is on file in any filing or recording office, except as
may affect Collateral with a value not in excess of $5,000,000.
D. MARGIN REGULATIONS. The pledge of the Pledged Collateral pursuant to
the Collateral Documents does not violate Regulation T, U or X of the Board of
Governors of the Federal Reserve System.
E. INFORMATION REGARDING COLLATERAL. All information supplied to
Administrative Agent by or on behalf of any Loan Party with respect to any of
the Collateral (in each case taken as a whole with respect to any particular
Collateral) is accurate and complete in all material respects.
5.17 DISCLOSURE.
No representation or warranty of any Loan Party or any of their
Subsidiaries contained in any Loan Document or in any other document,
certificate or written statement furnished to Lenders by or on behalf of any
Loan Party or any of their Subsidiaries for use in connection with the
transactions contemplated by this Agreement contains any untrue statement of a
material fact or omits to state a material fact (known to Borrowers, in the case
of any document not furnished by it) necessary in order to make the statements
contained herein or therein not misleading in any material manner in light of
the circumstances in which the same were made. Any projections and pro forma
financial information contained in such materials are based upon good faith
estimates and assumptions believed by Borrowers to be reasonable at the time
made, it being recognized by Lenders that such projections as to future events
are not to be viewed as facts and that actual results during the period or
periods covered by any such projections may differ from the projected results.
There are no facts known (or which should upon the reasonable exercise of
diligence be known) to Borrowers (other than matters of a general economic
nature) that, individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect and that have not been disclosed herein or
in such other documents, certificates and statements furnished to Lenders for
use in connection with the transactions contemplated hereby.
5.18 REIT STATUS.
For the fiscal year ended December 31, 2000, Meditrust qualified as a
REIT under the Internal Revenue Code.
5.19 INSURANCE.
Borrowers and their Subsidiaries currently maintain or require their
operators/lessees to maintain replacement cost insurance coverage in respect of
each of the Real Property Assets, as well as comprehensive general liability
insurance (including "builders' risk") against claims for personal, and bodily
injury and/or death, to one or more persons, or property damage, as well as
workers' compensation insurance, in each case with respect to the Real Property
Assets in amounts that prudent owner of assets such as the Real Property Assets
would maintain and pursuant to the insurances certificates, binders and policies
provided to Administrative Agent on or prior to the Closing Date.
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CREDIT AGREEMENT
SECTION 6. BORROWERS' AFFIRMATIVE COVENANTS
Borrowers covenant and agree that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations, unless Requisite Lenders shall otherwise give prior
written consent, Borrowers shall perform, and shall cause each of their
Subsidiaries to perform, all covenants in this Section 6.
6.1 FINANCIAL STATEMENTS AND OTHER REPORTS.
Borrowers will maintain, and cause each of their Subsidiaries to
maintain, a system of accounting established and administered in accordance with
sound business practices to permit preparation of financial statements in
conformity with GAAP. Borrowers will deliver to Administrative Agent:
(i) [Reserved];
(ii) QUARTERLY FINANCIALS: as soon as available and in any event
within five Business Days after filing with the Securities and
Exchange Commission, copies of the Borrowers' Quarterly Report on Form
10-Q prepared in compliance with the requirements therefor and filed
with the Securities and Exchange Commission;
(iii) YEAR-END FINANCIALS: as soon as available and in any event
within five Business Days after filing with the Securities and
Exchange Commission, copies of Borrowers' Annual Report on Form 10-K
for such fiscal year (together with the Borrowers' annual report to
shareholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act) prepared in accordance with the requirements therefor
and filed with the Securities and Exchange Commission;
(iv) OFFICERS' AND COMPLIANCE CERTIFICATES: together with each
delivery of financial statements of Borrowers and their Subsidiaries
pursuant to subdivisions (ii) and (iii) above, (a) an Officers'
Certificate of Borrowers stating that the signers have reviewed the
terms of this Agreement and have made, or caused to be made under
their supervision, a review in reasonable detail of the transactions
and condition of Borrowers and their Subsidiaries during the
accounting period covered by such financial statements and that such
review has not disclosed the existence during or at the end of such
accounting period, and that the signers do not have knowledge of the
existence as at the date of such Officers' Certificate, of any
condition or event that constitutes an Event of Default or Potential
Event of Default, or, if any such condition or event existed or
exists, specifying the nature and period of existence thereof and what
action Borrowers have taken, are taking and propose to take with
respect thereto; and (b) a Compliance Certificate demonstrating in
reasonable detail compliance during and at the end of the applicable
accounting periods with the restrictions contained in Section 7 and
Borrowers' compliance with Required Refinancing Liquidity levels for
any applicable Required Refinancing Liquidity Periods under subsection
2.9, in each case to the extent compliance with such restrictions is
required to be tested at the end of the applicable accounting period;
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CREDIT AGREEMENT
(v) RECONCILIATION STATEMENTS: if, as a result of any change in
accounting principles and policies from those used in the preparation
of the audited financial statements referred to in subsection 5.3
(other than an immaterial change in GAAP), the combined consolidated
financial statements of Borrowers and their Subsidiaries delivered
pursuant to subdivisions (ii) or (iii) of this subsection 6.1 will
differ in any material respect from the combined consolidated
financial statements that would have been delivered pursuant to such
subdivisions had no such change in accounting principles and policies
been made, then (a) together with the first delivery of financial
statements pursuant to subdivision (ii) or (iii) of this subsection
6.1 following such change, combined consolidated financial statements
of Borrowers and their Subsidiaries for (y) the current Fiscal Year to
the effective date of such change and (z) the full Fiscal Year
immediately preceding the Fiscal Year in which such change is made, in
each case prepared on a pro forma basis as if such change had been in
effect during such periods, and (b) together with each delivery of
financial statements pursuant to subdivision (ii) or (iii) of this
subsection 6.1 following such change, if required pursuant to
subsection 1.2, a written statement of the chief accounting officer or
chief financial officer of Borrowers or other person designated in
writing by such officers or Borrowers and approved by Administrative
Agent, such approval not to be unreasonably withheld, setting forth
the differences (including any differences that would affect any
calculations relating to the financial covenants set forth in
subsection 7.6) which would have resulted if such financial statements
had been prepared without giving effect to such change;
(vi) [Reserved];
(vii) EVENTS OF DEFAULT, ETC.: promptly upon any Executive
Officer of Borrowers obtaining knowledge (a) of any condition or event
that constitutes an Event of Default or Potential Event of Default, or
becoming aware that any Lender has given any notice (other than to
Administrative Agent) or taken any other action with respect to a
claimed Event of Default or Potential Event of Default, (b) that any
Person has given any notice to Borrowers or any of their Subsidiaries
or taken any other action with respect to a claimed default or event
or condition of the type referred to in subsection 8.2 that could
reasonably be expected to have a Material Adverse Effect, (c) of any
resignation or dismissal of Borrowers' independent accountant, (d) of
any Change of Control or other event requiring a prepayment of
principal on the Senior Notes or any Subordinated Indebtedness or
causing an event of default thereunder, or (e) of the occurrence of
any event or change that has caused or evidences, either in any case
or in the aggregate, a Material Adverse Effect, an Officers'
Certificate specifying the nature and period of existence of such
condition, event or change, or specifying the notice given or action
taken by any such Person and the nature of such claimed Event of
Default, Potential Event of Default, default, event or condition, and
what action Borrowers have taken, are taking and propose to take with
respect thereto;
(viii) LITIGATION OR OTHER PROCEEDINGS: promptly upon any
Executive Officer of Borrowers obtaining knowledge of (X) the
institution of, or (in the good faith judgment of Borrowers)
non-frivolous threat of, any action, suit, proceeding
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CREDIT AGREEMENT
(whether administrative, judicial or otherwise), governmental
investigation or arbitration against or affecting Borrowers or any of
their Subsidiaries or any property of Borrowers or any of their
Subsidiaries (collectively, "PROCEEDINGS") not previously disclosed in
writing by Borrowers to Lenders or (Y) any material development in any
Proceeding that, in any case:
(1) if adversely determined, has a reasonable probability of
giving rise to a Material Adverse Effect; or
(2) seeks to enjoin or otherwise prevent the consummation
of, or to recover any damages or obtain relief as a result of,
the transactions contemplated hereby;
written notice thereof together with such other information as may be
reasonably available to Borrowers to enable Lenders and their counsel
to evaluate such matters;
(ix) ERISA EVENTS: to the extent applicable, promptly upon
becoming aware of the occurrence of or forthcoming occurrence of any
ERISA Event, a written notice specifying the nature thereof, what
action Borrowers, any of their Subsidiaries or any of their respective
ERISA Affiliates has taken, is taking or proposes to take with respect
thereto and, when known, any action taken or threatened by the
Internal Revenue Service, the Department of Labor or the PBGC with
respect thereto;
(x) ERISA NOTICES: after the occurrence of an Event of Default,
with reasonable promptness, copies of (a) each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) filed by
Borrowers, any of their Subsidiaries or any of their respective ERISA
Affiliates with the Internal Revenue Service with respect to each
Pension Plan; (b) all notices received by Borrowers, any of their
Subsidiaries or any of their respective ERISA Affiliates from a
Multiemployer Plan sponsor concerning an ERISA Event; and (c) copies
of such other documents or governmental reports or filings relating to
any Employee Benefit Plan as Administrative Agent shall reasonably
request;
(xi) [Reserved];
(xii) INSURANCE: upon the prior written request of Administrative
Agent, as soon as practicable and in any event by the last day of any
Fiscal Year and no more frequently than once in any Fiscal Year, a
report in form and substance satisfactory to Administrative Agent
outlining all material insurance coverage maintained as of the date of
such report by Borrowers and their Subsidiaries and all material
insurance coverage planned to be maintained by Borrowers and their
Subsidiaries in the immediately succeeding Fiscal Year;
(xiii) [Reserved];
(xiv) NEW SUBSIDIARIES: promptly upon any Person becoming a
Subsidiary of Borrowers, a written notice setting forth with respect
to such Person (a) the date on which such Person became a Subsidiary
of Borrowers and (b) all of the data required
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CREDIT AGREEMENT
to be set forth in SCHEDULE 5.1 annexed hereto with respect to all
Subsidiaries of Borrowers (it being understood that such written
notice shall be deemed to supplement SCHEDULE 5.1 annexed hereto for
all purposes of this Agreement);
(xv) MARGIN DETERMINATION CERTIFICATE: commencing with the Fiscal
Quarter ended September, 2001, together with each delivery of
financial statements pursuant to subdivisions (ii) and (iii) above, a
Margin Determination Certificate demonstrating in reasonable detail
the calculation of the Total Leverage Ratio for the four consecutive
Fiscal Quarters ending on the day of the accounting period covered by
such financial statements;
(xvi) [Reserved];
(xvii) REVISIONS OR UPDATES TO SCHEDULES: should any of the
information or disclosures provided on Schedule 5.1 or on any of the
Schedules originally attached to any of the Collateral Documents
become outdated or incorrect in any material respect, such revisions
or updates to such Schedules as may be necessary or appropriate to
update or correct such Schedules; in addition to the foregoing, such
revisions or updates to the Schedules attached to the Loan Documents
as Administrative Agent may request, any such request to be made no
more frequently than once per quarter; PROVIDED that in each case no
such revisions or updates to any Schedules shall be deemed to have
amended, modified or superseded such Schedules immediately prior to
the submission of such revised or updated Schedules, or to have cured
any breach of warranty or representation resulting from the inaccuracy
or incompleteness of any such Schedules, unless and until the
Requisite Lenders in their sole and absolute discretion, shall have
accepted in writing such revisions or updates to such Schedules;
(xviii) CONVERSION: in the event that the Borrowers elect to
undertake the Conversion, Borrowers shall (a) provide fourteen days'
written notice to the Administrative Agent and Syndication Agent, (b)
provide the Administrative Agent and Syndication Agent with copies of
all documents and agreements related to the proposed Conversion
reasonably required by Administrative Agent and Syndication Agent, and
(c) execute, or cause its Subsidiaries to execute, such documentation
as reasonably requested by the Administrative Agent and Syndication
Agent in order to maintain the effectiveness of this Agreement and the
Loan Documents; and
(xix) Other Information: with reasonable promptness, such other
information and data with respect to Borrowers or any of their
Subsidiaries as from time to time may be reasonably requested by any
Lender.
6.2 CORPORATE EXISTENCE, ETC.
Except as permitted under subsection 7.7, Borrowers will, and will
cause each of their Subsidiaries to, at all times preserve and keep in full
force and effect its corporate existence and all rights and franchises material
to its business; PROVIDED, HOWEVER that neither of the Borrowers nor any of
their Subsidiaries shall be required to preserve any such
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CREDIT AGREEMENT
right or franchise or such existence in the case of Subsidiaries if the Board of
Directors of Borrowers or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of Borrowers or
such Subsidiary, as the case may be, and that the loss thereof is not
disadvantageous in any material respect to the Loan Parties taken as a whole or
Lenders.
6.3 PAYMENT OF TAXES AND CLAIMS; TAX CONSOLIDATION.
A. Borrowers will, and will cause each of their Subsidiaries to, pay
all material taxes, assessments and other governmental charges imposed upon them
or any of their properties or assets or in respect of any of their income,
businesses or franchises before any material penalty accrues thereon, and all
material claims (including claims for labor, services, materials and supplies)
for sums that have become due and payable and that by law have or may become a
Lien upon any of its properties or assets, prior to the time when any penalty or
fine shall be incurred with respect thereto; PROVIDED that no such charge or
claim need be paid if it is being contested in good faith by appropriate
proceedings promptly instituted and diligently conducted, so long as (1) such
reserve or other appropriate provision, if any, as shall be required in
conformity with GAAP shall have been made therefor and (2) in the case of a
charge or claim which has or may become a Lien against any of the Collateral,
such contest proceedings conclusively operate to stay the sale of any portion of
the Collateral to satisfy such charge or claim.
B. Borrowers will not, nor will it permit any of their Subsidiaries to,
file or consent to the filing of any consolidated income tax return with any
Person (other than Borrowers or any of their Subsidiaries).
6.4 MAINTENANCE OF PROPERTIES; INSURANCE.
A. MAINTENANCE OF PROPERTIES. Borrowers will, and will cause each of
their Subsidiaries to, maintain or cause to be maintained in good repair,
working order and condition, ordinary wear and tear excepted, all material
properties used or useful in the business of Borrowers and their Subsidiaries
(including all Intellectual Property) and from time to time will make or cause
to be made all appropriate repairs, renewals and replacements thereof, except
where, individually or in the aggregate, the failure to do so could not
reasonably be expected to have a Material Adverse Effect.
B. INSURANCE. Borrowers will maintain or cause to be maintained, with
financially sound and reputable insurers, such public liability insurance, third
party property damage insurance, business interruption insurance and casualty
insurance with respect to liabilities, losses or damage in respect of the
assets, properties and businesses of Borrowers and their Subsidiaries as may
customarily be carried or maintained under similar circumstances by corporations
of established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles, covering such
risks and otherwise on such terms and conditions as shall be customary for
corporations similarly situated in the industry which insurance shall in no
event provide for materially less coverage than the insurance in effect on the
Closing Date. Borrowers shall provide Administrative Agent from time to time,
upon request (i) copies of the policies under which
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CREDIT AGREEMENT
such insurance is issued, certificates of insurance and such other information
relating to such insurance as the Administrative Agent may request, (ii) with
respect to any policy providing for coverage in excess of $25,000,000, within
five days of receipt of notice from any insurer, a copy of any notice of
cancellation or material change in coverage from that existing on the Closing
Date and (iii) with respect to any policy providing for coverage in excess of
$25,000,000, on the day of issuance, notice of any cancellation or nonrenewal of
coverage by the Borrowers or their Subsidiaries.
6.5 INSPECTION RIGHTS LENDER MEETING.
A. INSPECTION RIGHTS. Borrowers shall, and shall cause each of their
Subsidiaries to, permit any authorized representatives designated by any Lender
to visit and inspect, subject to the rights of any tenants or lessees of
Borrowers and their Subsidiaries, any of the properties of Borrowers or of any
of their Subsidiaries, to inspect, copy and take extracts from its and their
financial and accounting records, and to discuss its and their affairs, finances
and accounts with its and their officers and independent public accountants, all
upon reasonable notice and at such reasonable times during normal business hours
and as often as may reasonably be requested. Lenders shall coordinate their
visits and inspections with those of Administrative Agent so as to minimize the
number of separate visits to Borrowers' premises.
B. LENDER MEETING. Borrowers will, upon the request of Administrative
Agent, participate in a meeting of Administrative Agent and Lenders once during
each Fiscal Year to be held at Borrowers' corporate offices (or at such other
location as may be agreed to by Borrowers and Administrative Agent) at such time
as may be agreed to by Borrowers and Administrative Agent.
6.6 COMPLIANCE WITH LAWS, ETC.
Borrowers shall comply, and shall cause each of their Subsidiaries and
all other Persons on or occupying any Real Property Assets to comply, with the
requirements of all applicable laws, rules, regulations and orders of any
governmental authority (including all Environmental Laws), noncompliance with
which could reasonably be expected to cause, individually or in the aggregate, a
Material Adverse Effect.
6.7 ENVIRONMENTAL REVIEW AND INVESTIGATION, DISCLOSURE, ETC.; BORROWER'S
ACTIONS REGARDING HAZARDOUS MATERIALS ACTIVITIES, ENVIRONMENTAL CLAIMS
AND VIOLATIONS OF ENVIRONMENTAL LAWS.
A. ENVIRONMENTAL REVIEW AND INVESTIGATION. Borrowers agree that
Administrative Agent may, from time to time and in its reasonable discretion, if
a Potential Event of Default relating to environmental matters or an Event of
Default has occurred and is continuing, retain, at Borrower's expense, an
independent professional consultant to review any environmental audits,
investigations, analyses and reports relating to Hazardous Materials prepared by
or for Borrowers or conduct its own investigation of any Real Property Asset.
For purposes of conducting such a review and/or investigation, Borrowers hereby
grant to Administrative Agent and its Administrative Agents, employees,
consultants
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and contractors the right to enter into or onto any Real Property Assets
currently owned, leased, operated or used by Borrowers or any of their
Subsidiaries, subject to the rights of any tenants or lessees of Borrowers and
their Subsidiaries, and to perform so-called "Phase I" environmental assessment
tests on such property. Any such investigation of any Real Property Asset shall
be conducted, unless otherwise agreed to by Borrowers and Administrative Agent,
during normal business hours and shall be conducted so as not to interfere with
the ongoing operations at such Real Property Asset or to cause any damage or
loss to any property at such Real Property Asset. Borrowers and Administrative
Agent hereby acknowledge and agree that any report of any investigation
conducted at the request of Administrative Agent pursuant to this subsection
6.7A will be obtained and shall be used by Administrative Agent and Lenders
solely for the purposes of Lenders' internal credit decisions, to monitor and
police the Loans and to protect Lenders' security interests, if any, created by
the Loan Documents. Administrative Agent agrees to deliver a copy of any such
report to Borrowers with the understanding that Borrowers acknowledge and agree
that (x) it will indemnify and hold harmless Administrative Agent and each
Lender from any costs, losses or liabilities relating to Borrowers' use of or
reliance on such report, (y) neither Administrative Agent nor any Lender makes
any representation or warranty with respect to such report, and (z) by
delivering such report to Borrowers, neither Administrative Agent nor any Lender
is requiring or recommending the implementation of any suggestions or
recommendations contained in such report.
B. ENVIRONMENTAL DISCLOSURE. If reasonably required by Administrative
Agent, Borrowers will deliver to Administrative Agent:
(i) ENVIRONMENTAL AUDITS AND REPORTS. As soon as practicable
following receipt thereof, copies of all material environmental
audits, investigations, analyses and reports of any kind or character,
whether prepared by personnel of Borrowers or any of their
Subsidiaries or by independent consultants, governmental authorities
or any other Persons, with respect to significant environmental
matters at any Real Property Asset which, individually or in the
aggregate, could reasonably be expected to result in a Material
Adverse Effect or with respect to any Environmental Claims which,
individually or in the aggregate, could reasonably be expected to
result in a Material Adverse Effect; and
(ii) OTHER INFORMATION. With reasonable promptness, such other
documents and information as from time to time may be reasonably
requested by Administrative Agent in relation to any matters disclosed
pursuant to this subsection 6.7.
C. BORROWERS' ACTIONS REGARDING HAZARDOUS MATERIALS ACTIVITIES,
ENVIRONMENTAL CLAIMS AND VIOLATIONS OF ENVIRONMENTAL LAWS. Borrowers shall
promptly take, and shall cause each of their Subsidiaries promptly to take, any
and all actions necessary to (i) cure any violation of applicable Environmental
Laws by Borrowers or their Subsidiaries that could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and (ii) make
an appropriate response to any Environmental Claim against Borrowers or any of
their Subsidiaries and discharge any
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obligations it may have to any Person thereunder where failure to do so could
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
6.8 EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS BY CERTAIN SUBSIDIARIES AND FUTURE SUBSIDIARIES.
A. EXECUTION OF SUBSIDIARY GUARANTY AND PERSONAL PROPERTY COLLATERAL
DOCUMENTS. If any Person organized under the laws of the United States or any
State thereof or the District of Columbia becomes a wholly-owned Subsidiary (and
each other Subsidiary which may execute a Loan Document without violating any
provision of such Subsidiary's organizational documents or other agreement or
instrument to which such Subsidiary is a party) of Borrowers after the date
hereof, Borrowers will promptly notify Administrative Agent of that fact and
cause such Subsidiary to execute and deliver to Administrative Agent a
counterpart of the Subsidiary Guaranty and the Pledge Agreement and to take all
such further actions and execute all such further documents and instruments
(including actions, documents and instruments comparable to those described in
subsection 4.1F) as may be necessary or, in the opinion of Administrative Agent,
desirable to create in favor of Administrative Agent, for the benefit of
Lenders, a valid First Priority Lien on all of the Collateral of or relating to
such Subsidiary and owned by the Borrowers or their Subsidiaries as described in
the applicable forms of the Collateral Documents.
B. SUBSIDIARY CHARTER DOCUMENTS, LEGAL OPINIONS, ETC. To the extent
reasonably requested by Administrative Agent, Borrowers shall deliver to
Administrative Agent, together with such Loan Documents, (i) certified copies of
such Subsidiary's Certificate or Articles of Incorporation, together with a good
standing certificate from the Secretary of State of the jurisdiction of its
incorporation and each other state in which such Person is qualified as a
foreign corporation to do business and, to the extent generally available, a
certificate or other evidence of good standing as to payment of any applicable
franchise or similar taxes from the appropriate taxing authority of each of such
jurisdictions, each to be dated a recent date prior to their delivery to
Administrative Agent, (ii) a copy of such Subsidiary's Bylaws, certified by its
corporate secretary or an assistant secretary as of a recent date prior to their
delivery to Administrative Agent, (iii) a certificate executed by the secretary
or an assistant secretary of such Subsidiary as to (a) the fact that the
attached resolutions of the Board of Directors of such Subsidiary approving and
authorizing the execution, delivery and performance of such Loan Documents are
in full force and effect and have not been modified or amended and (b) the
incumbency and signatures of the officers of such Subsidiary executing such Loan
Documents, and (iv) a favorable opinion of counsel to such Subsidiary, in form
and substance satisfactory to Administrative Agent and its counsel, as to (a)
the due organization and good standing of such Subsidiary, (b) the due
authorization, execution and delivery by such Subsidiary of such Loan Documents,
(c) the enforceability of such Loan Documents against such Subsidiary, (d) such
other matters (including matters relating to the creation and perfection of
Liens in any Collateral pursuant to such Loan Documents) as Administrative Agent
may reasonably request, all of the foregoing to be satisfactory in form and
substance to Administrative Agent and its counsel.
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CREDIT AGREEMENT
SECTION 7. BORROWERS' NEGATIVE COVENANTS
Borrowers covenant and agree that, so long as any of the Commitments
hereunder shall remain in effect and until payment in full of all of the Loans
and other Obligations and the cancellation or expiration of all Letters of
Credit, unless Requisite Lenders shall otherwise give prior written consent,
Borrowers shall perform, and shall cause each of their Subsidiaries to perform,
all covenants in this Section 7.
7.1 INDEBTEDNESS.
Borrowers shall not, and shall not permit any of their Subsidiaries to,
directly or indirectly, create, incur, assume or guaranty, or otherwise become
or remain directly or indirectly liable with respect to, any Indebtedness,
except:
(i) Borrowers may become and remain liable with respect to the
Obligations;
(ii) any Borrower and its Subsidiaries may become and remain
liable with respect to Contingent Obligations permitted by subsection
7.4 and, upon any matured obligations actually arising pursuant
thereto, the Indebtedness corresponding to the Contingent Obligations
so extinguished;
(iii) any Borrower may become and remain liable with respect to
Indebtedness to any Borrower or any Subsidiary of any Borrower; any
Subsidiary Guarantor may become and remain liable with respect to
Indebtedness to any Borrower or any Subsidiary of any Borrower; any
Subsidiary which is not a Subsidiary Guarantor may become and remain
liable with respect to Indebtedness to other Subsidiaries which are
not Subsidiary Guarantors; and any Subsidiary which is not a
Subsidiary Guarantor may become and remain liable with respect to
Indebtedness to any Borrower or any Subsidiary Guarantor in an
aggregate amount which, together with the other Investments made by
Borrower and Subsidiary Guarantors after the date hereof in
Subsidiaries which are not Subsidiary Guarantors under subsection
7.3(vii)(d), does not exceed $15,000,000 at any time outstanding for
all such Subsidiaries which are not Subsidiary Guarantors; PROVIDED
that (a) all such intercompany Indebtedness shall be evidenced by
promissory notes except to the extent the issuance of such promissory
notes may impair Meditrust's qualification as a REIT, (b) all such
intercompany Indebtedness owed by Borrowers and by any Subsidiary
Guarantors shall be subordinated in right of payment to the payment in
full of the Obligations pursuant to the terms of the applicable
promissory notes or an intercompany subordination agreement, and (c)
any payment by any Subsidiary of Borrowers under any guaranty of the
Obligations shall result in a PRO TANTO reduction of the amount of any
intercompany Indebtedness owed by such Subsidiary to Borrowers or to
any of their Subsidiaries for whose benefit such payment is made; and
PROVIDED that intercompany obligations of Borrowers and their
Subsidiaries constituting rental, lease, license or royalty payments,
including such payments deferred in the ordinary course of business
and consistent with past practices, do not constitute Indebtedness
hereunder;
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CREDIT AGREEMENT
(iv) Borrowers and their Subsidiaries may enter into a
securitization financing transaction with respect to any of their
Lodging Assets in an aggregate principal amount not to exceed
$150,000,000 which securitization transaction shall not terminate or
have a maturity prior to six months after the final maturity of the
Term Loans; PROVIDED that the aggregate Indebtedness incurred in
connection with such securitization shall not be less than an amount
equal to 40% of the Fair Market Value of the assets encumbered by or
otherwise subject to such securitization and such assets shall not
account for or generate more than 20% of Lodging EBITDA for the most
recently ended four consecutive Fiscal Quarter period as of the date
of such securitization;
(v) Borrowers may remain liable with respect to the Senior Notes
and may incur unsubordinated Indebtedness secured on the same basis as
the Indebtedness so refinanced and Subordinated Indebtedness to
refinance all or any of the Senior Notes, PROVIDED that the obligor on
such refinancing Indebtedness is the same as the obligor on the
Indebtedness so refinanced, all of the proceeds thereof (net of
reasonable and customary fees, costs and expenses) shall be applied to
the repayment, repurchase or redemption of such Senior Notes, and the
covenants of such refinancing Indebtedness shall be less restrictive
than those in this Agreement and such covenants shall be on generally
prevailing market terms available to the Borrowers for such
refinancing Indebtedness, and the maturity date thereof or any date on
which such refinancing Indebtedness may be required to be repurchased
at the option of the holder thereof shall not be earlier than November
30, 2005 (collectively, the "REFINANCING INDEBTEDNESS");
(vi) In addition to any Subordinated Indebtedness incurred or
existing pursuant to subsection 7.1(v), Borrowers may become and
remain liable with respect to Subordinated Indebtedness in an
aggregate principal amount not to exceed $200,000,000;
(vii) Borrowers and their Subsidiaries may become and remain
liable with respect to any secured Indebtedness and other secured
obligations; PROVIDED, that the amount of such secured Indebtedness
and other secured obligations shall not, individually or in the
aggregate, exceed an amount equal to 10% of Consolidated Net Tangible
Assets;
(viii) Borrowers and their Subsidiaries may remain liable with
respect to the Indebtedness of the Borrowers and their Subsidiaries
existing as of the Closing Date (and any refinancings, replacements or
substitutions thereof which do not increase the amount thereof or
increase any collateral therefor) and described in SCHEDULE 7.1
annexed hereto; and
(ix) Borrowers and their Subsidiaries may incur other unsecured
Indebtedness not expressly permitted under clauses (i) through (viii),
inclusive, of subsection 7.1 in an aggregate principal amount not to
exceed $40,000,000 at any time outstanding.
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CREDIT AGREEMENT
7.2 LIENS AND RELATED MATTERS.
A. PROHIBITION ON LIENS. Borrowers shall not, and shall not permit any
of their Subsidiaries to, directly or indirectly, create, incur, assume or
permit to exist any Lien on or with respect to any property or asset of any kind
(including any document or instrument in respect of goods or accounts
receivable) of Borrowers or any of their Subsidiaries, whether now owned or
hereafter acquired, or any income or profits therefrom, or file or permit the
filing of, or permit to remain in effect, any financing statement or other
similar notice of any Lien with respect to any such property, asset, income or
profits under the UCC of any State or under any similar recording or notice
statute, except:
(i) Permitted Encumbrances;
(ii) Liens granted pursuant to the Collateral Documents,
including without limitation, Liens which equally and ratably secure,
to the extent required by the Senior Note Documents, the aggregate
principal amount of the Senior Notes outstanding on the date hereof
including, without limitation, the 7.114% Senior Notes;
(iii) Liens described in SCHEDULE 7.2 annexed hereto;
(iv) Liens securing Indebtedness permitted pursuant to subsection
7.1(iv);
(v) Liens securing Indebtedness and any other obligations
permitted pursuant to subsection 7.1(vii); and
(vi) Liens in favor of vendors of goods and services in the
ordinary course of business securing Indebtedness permitted under
subsection 7.1 incurred in connection with the purchase of such goods
and services, provided that such Liens shall only encumber such goods
so purchased.
B. EQUITABLE LIEN IN FAVOR OF LENDERS. If any Borrower or any of its
Subsidiaries shall create or assume any Lien upon any of its properties or
assets, whether now owned or hereafter acquired, other than Liens excepted by
the provisions of subsection 7.2A, it shall make or cause to be made effective
provision whereby the Obligations will be secured by such Lien equally and
ratably with any and all other Indebtedness secured thereby as long as any such
Indebtedness shall be so secured; PROVIDED that, notwithstanding the foregoing,
this covenant shall not be construed as a consent by Requisite Lenders to the
creation or assumption of any such Lien not permitted by the provisions of
subsection 7.2A; and PROVIDED FURTHER that notwithstanding the foregoing, if any
Borrower or any of its Subsidiaries shall create or assume any Lien in favor of
any Indebtedness permitted pursuant to subsection 7.1(v), it shall make or cause
to be made effective provision whereby the Obligations will be secured by such
Lien equally and ratably with any and all other Indebtedness secured thereby as
long as any such Indebtedness shall be so secured.
C. NO FURTHER NEGATIVE PLEDGES. Except with respect to specific
property encumbered to secure payment of particular Indebtedness or to be sold
pursuant to an executed agreement with respect to an Asset Sale, neither of the
Borrowers nor any of their
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CREDIT AGREEMENT
Subsidiaries shall enter into any agreement prohibiting the creation or
assumption of any Lien upon any of its properties or assets, whether now owned
or hereafter acquired.
D. NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS TO BORROWERS OR OTHER
SUBSIDIARIES. Except as provided herein, Borrowers will not, and will not permit
any of their Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any such Subsidiary to (i) pay dividends or make any other
distributions on any of such Subsidiary's capital stock owned by Borrowers or
any other Subsidiary of Borrowers, (ii) repay or prepay any Indebtedness owed by
such Subsidiary to Borrowers or any other Subsidiary of Borrowers, (iii) make
loans or advances to Borrowers or any other Subsidiary of Borrowers, or (iv)
transfer any of its property or assets to Borrowers or any other Subsidiary of
Borrowers; provided that the foregoing shall not apply to (a) restrictions and
conditions existing on the date hereof and identified on SCHEDULE 7.2 (but shall
apply to any extension or renewal of, or any amendment or modification expanding
the scope of, any such restriction or condition), (b) customary restrictions and
conditions contained in agreements relating to Assets Sales permitted by this
Agreement with respect to the assets being sold, (c) customary restrictions or
conditions imposed by any agreement evidencing secured Indebtedness permitted
under subsections 7.1(iv) and 7.1(vii) with respect to the assets subject to
such securitization transaction or Indebtedness, and (d) customary provisions in
leases and other contracts restricting the assignment thereof.
7.3 INVESTMENTS; JOINT VENTURES.
Borrowers shall not, and shall not permit any of their Subsidiaries to,
directly or indirectly, make or own any Investment in any Person, except:
(i) Borrowers and Subsidiaries may make and own Investments in
Joint Ventures and Franchise Arrangements in Borrowers' and their
Subsidiaries' ordinary course of business; PROVIDED that such
Investments shall not exceed $50,000,000 in the aggregate and
$20,000,000 in any calendar year;
(ii) Borrowers and their Subsidiaries may make and own
Investments in Cash and Cash Equivalents;
(iii) Borrowers and their Subsidiaries may make Capital
Expenditures permitted by subsection 7.8;
(iv) Borrowers and their Subsidiaries may continue to own the
Investments owned by them and described in SCHEDULE 7.3 annexed hereto
as of the Closing Date;
(v) Borrowers and their Subsidiaries may make and own Investments
with respect to any obligation to indemnify their respective officers
and directors to the fullest extent permitted by the law of the
jurisdiction of such Person's organization;
(vi) Borrowers and their Subsidiaries may make and own
Investments which do not require the payment of any Cash or non-cash
consideration;
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CREDIT AGREEMENT
(vii) (a) Borrowers and their respective Subsidiaries may
continue to own the Investments owned by them as of the Closing Date
in any Subsidiaries of Borrowers; (b) Borrowers and their respective
Subsidiary Guarantors may make and own additional equity Investments
in Borrowers and in their respective Subsidiary Guarantors; (c)
Subsidiaries which are not Subsidiary Guarantors may make Investments
in other Subsidiaries which are not Subsidiary Guarantors; and (d)
Borrowers and Subsidiary Guarantors may make and own Investments after
the date hereof in other Subsidiaries which are not Subsidiary
Guarantors which Investments, together with intercompany loans made by
Borrowers and Subsidiary Guarantors to Subsidiaries which are not
Subsidiary Guarantors pursuant to subsection 7.1(iii), do not exceed
$15,000,000 at any time outstanding;
(viii) Borrowers and their respective Subsidiaries may make
intercompany loans to the extent permitted under subsection 7.1(iii);
(ix) Borrowers and their respective Subsidiaries may receive and
hold promissory notes and other non-cash consideration received in
connection with any Asset Sale permitted by subsection 7.7; and
(x) Borrowers and their respective Subsidiaries may consummate
the Conversion, including without limitation any name changes
contemplated thereby.
7.4 CONTINGENT OBLIGATIONS.
Borrowers shall not, and shall not permit any of their Subsidiaries to,
directly or indirectly, create or become or remain liable with respect to any
Contingent Obligation, except:
(i) Borrowers may become and remain liable with respect to
Contingent Obligations in respect of Letters of Credit issued under
this Agreement, and Subsidiaries of Borrowers may become and remain
liable with respect to Contingent Obligations in respect of the
Subsidiary Guaranty;
(ii) Borrowers and their Subsidiaries may become and remain
liable with respect to Contingent Obligations in respect of customary
indemnification and purchase price adjustment obligations incurred in
connection with (x) Asset Sales or other sales of assets, and (y)
Investments permitted under this Agreement;
(iii) Borrowers and their Subsidiaries may become and remain
liable with respect to Contingent Obligations in respect of any
Indebtedness of Borrowers or any of their Subsidiaries permitted by
subsection 7.1; PROVIDED that Subsidiaries of Borrowers may not become
liable in respect of Indebtedness of Borrowers under subsections
7.1(v) and 7.1(vi);
(iv) Borrowers and their Subsidiaries, as applicable, may remain
liable with respect to Contingent Obligations described in SCHEDULE
7.4 annexed hereto;
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CREDIT AGREEMENT
(v) Borrowers and their Subsidiaries may become and remain liable
with respect to Contingent Obligations incurred in the ordinary course
of business with respect to surety and appeal bonds, performance bonds
and other similar obligations; and Borrowers and their Subsidiaries
may become and remain liable with respect to Contingent Obligations in
respect of letters of credit PROVIDED that the aggregate amount of
such Contingent Obligations shall not exceed $10,000,000; and
(vi) Borrowers may become and remain liable with respect to
Contingent Obligations under Hedge Agreements.
7.5 RESTRICTED PAYMENTS.
A. Borrowers shall not, and shall not permit any of their Subsidiaries
to, directly or indirectly, declare, order, pay, make or set apart any sum for
any Restricted Payment; PROVIDED, HOWEVER, that:
(i) Borrowers may declare and pay dividends and distributions
payable in respect of Existing Preferred Stock; PROVIDED, that such
dividends or distributions are regularly scheduled and paid quarterly
in accordance with Borrowers' ordinary course of business;
(ii) Borrowers may declare and pay dividends and distributions in
an amount required for Meditrust to maintain its REIT status; PROVIDED
that all existing and future net operating loss carry forwards must
first be applied to reduce REIT taxable income and to otherwise offset
any income tax liability and PROVIDED, further that the Borrowers
shall have first declared and paid all required dividends and
distributions described under clause (i) above;
(iii) in addition to the payments under clauses (i) and (ii)
above, Borrowers may declare and pay cash dividends and make
distributions on account of or repurchase any of their capital stock
including without limitation any paired share repurchases; PROVIDED
(A) the aggregate amount thereof shall not exceed $20,000,000 in any
Fiscal Year; (B) after the Conversion and only in the same Fiscal Year
in which the Conversion is completed, such aggregate amount shall be
increased to $30,000,000; (C) in the event that after giving pro forma
effect to any borrowing made in connections with such payments, (1) no
Potential Event of Default or Event of Default then exists, (2) the
Total Leverage Ratio is less than 4.00:1.00, (3) the Conversion has
been completed and (4) the Revolving Loan Commitments exceed the Total
Utilization of Revolving Loan Commitments by not less than
$50,000,000, such aggregate amount shall be increased to $40,000,000
for each Fiscal Year; provided that such $20,000,000, $30,000,000 or
$40,000,000, as applicable pursuant to (A), (B) or (C) hereof, shall
be increased by an amount equal to the excess, if any, of (X) the
amount of Restricted Payments permitted pursuant to this subsection
7.5A(iii) for the previous Fiscal Year over (Y) the actual amount of
Restricted Payments made pursuant to this subsection 7.5A(iii) in such
previous Fiscal Year; and PROVIDED that any dividends paid after the
Conversion by Meditrust on shares of its common stock to Meditrust
OpCo shall not be included as dividends or
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CREDIT AGREEMENT
distributions for purposes of determining amounts paid pursuant to the
foregoing clauses (A), (B) and (C) hereof;
(iv) Borrowers may make Restricted Payments to redeem shares of
its capital stock or warrants or options to acquire any such shares
from employees of Borrowers and their Subsidiaries upon the death or
other termination of employment of such employees, provided that no
Event of Default shall have occurred and be continuing or would arise
as a result of such Restricted Payment; and
(v) Borrowers may make regularly scheduled payments of interest
permitted pursuant to subsections 7.1(v) and (vi), in accordance with
the terms of and to the extent required by, the provisions of the
indentures governing such Subordinated Indebtedness; provided that no
Potential Event of Default under subsection 8.1 or Event of Default
shall have occurred and be continuing or would arise as a result of
such Restricted Payment.
B. Borrowers shall not, and shall not permit any of their Subsidiaries
to, directly or indirectly, to prepay, redeem, repurchase, retire, defease or
make any similar payment with respect to any Indebtedness (other than pursuant
to this Agreement); PROVIDED that if no Potential Event of Default or Event of
Default shall have occurred and be continuing or would arise as a result
thereof, Borrowers may prepay, redeem, repurchase, retire, defease or make
similar payments with respect to any Indebtedness to the extent that: (A) (1)
such Indebtedness matures or is redeemable at the option of the holder of such
Indebtedness on or prior to August 31, 2004; (2) the prepayment or repurchase of
such Indebtedness is completed on a basis that is economically advantageous to
the Borrowers and their Subsidiaries on a net present value basis; and (3) at
the time of the prepayment or repurchase of such Indebtedness and after giving
effect thereto Liquidity shall not be less than the sum of (x) the principal
amount of all Indebtedness of Borrowers maturing or redeemable at the option of
the holder thereof on or prior to May 31, 2003 PLUS (y) $30,000,000 or (B) the
Indebtedness is unsecured Indebtedness permitted under subsection 7.1(ix)
pursuant to a revolving credit facility.
7.6 FINANCIAL COVENANTS.
A. MAXIMUM TOTAL LEVERAGE RATIO. Borrowers shall not permit the Total
Leverage Ratio as of the last day of any Fiscal Quarter set forth below to
exceed the correlative ratio indicated below:
PERIOD MAXIMUM TOTAL LEVERAGE RATIO
------ ----------------------------
2nd Fiscal Quarter, Fiscal Year 2001 4.60:1.00
3rd Fiscal Quarter, Fiscal Year 2001 4.60:1.00
4th Fiscal Quarter, Fiscal Year 2001 4.50:1.00
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PERIOD MAXIMUM TOTAL LEVERAGE RATIO
------ ----------------------------
1st Fiscal Quarter, Fiscal Year 2002 4.50:1.00
2nd Fiscal Quarter, Fiscal Year 2002 4.25:1.00
3rd Fiscal Quarter, Fiscal Year 2002 4.25:1.00
4th Fiscal Quarter, Fiscal Year 2002 4.25:1.00
1st Fiscal Quarter, Fiscal Year 2003 4.25:1.00
2nd Fiscal Quarter, Fiscal Year 2003 4.00:1.00
3rd Fiscal Quarter, Fiscal Year 2003 4.00:1.00
4th Fiscal Quarter, Fiscal Year 2003 4.00:1.00
1st Fiscal Quarter, Fiscal Year 2004 4.00:1.00
2nd Fiscal Quarter, Fiscal Year 2004 3.75:1.00
and each Fiscal Quarter thereafter
B. MINIMUM LODGING EBITDA. Borrowers shall not permit Lodging EBITDA
for any four consecutive Fiscal Quarter period ending on the last day of any
Fiscal Quarter set forth below to be less than the amount indicated which
required amount shall be reduced by the amount of Lodging EBITDA generated by or
attributable to Lodging Assets which were the subject of a disposition during
such four Fiscal Quarter Period:
PERIOD MINIMUM LODGING EBITDA
------ ----------------------
2nd Fiscal Quarter, Fiscal Year 2001 $190,000,000
3rd Fiscal Quarter, Fiscal Year 2001 $190,000,000
4th Fiscal Quarter, Fiscal Year 2001 $190,000,000
1st Fiscal Quarter, Fiscal Year 2002 and $200,000,000
each Fiscal Quarter thereafter
C. MINIMUM INTEREST COVERAGE RATIO. Borrowers shall not permit the
ratio of (i) Consolidated EBITDA to (ii) Consolidated Net Interest Expense for
any four consecutive Fiscal Quarter period ending on the last day of any Fiscal
Quarter set forth below to be less than the correlative ratio indicated:
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CREDIT AGREEMENT
PERIOD MINIMUM INTEREST COVERAGE RATIO
------ -------------------------------
2nd Fiscal Quarter, Fiscal Year 2001 2.35:1.00
3rd Fiscal Quarter, Fiscal Year 2001 2.35:1.00
4th Fiscal Quarter, Fiscal Year 2001 2.35:1.00
1st Fiscal Quarter, Fiscal Year 2002 2.35:1.00
2nd Fiscal Quarter, Fiscal Year 2002 2.50:1.00
3rd Fiscal Quarter, Fiscal Year 2002 2.50:1.00
4th Fiscal Quarter, Fiscal Year 2002 2.50:1.00
1st Fiscal Quarter, Fiscal Year 2003 2.50:1.00
2nd Fiscal Quarter, Fiscal Year 2003 2.50:1.00
3rd Fiscal Quarter, Fiscal Year 2003 2.50:1.00
4th Fiscal Quarter, Fiscal Year 2003 2.50:1.00
1st Fiscal Quarter, Fiscal Year 2004 and 2.65:1.00
each Fiscal Quarter thereafter
D. MINIMUM FIXED CHARGE COVERAGE RATIO. Borrowers shall not permit the ratio of
(i) Consolidated EBITDA MINUS the Capital Expenditure Reserve to (ii) Fixed
Charges for any four consecutive Fiscal Quarter period ending on the last day of
any Fiscal Quarter set forth below to be less than the correlative ratio
indicated:
PERIOD MINIMUM FIXED CHARGE COVERAGE RATIO
------ -----------------------------------
2nd Fiscal Quarter, Fiscal Year 2001 1.45:1.00
3rd Fiscal Quarter, Fiscal Year 2001 1.55:1.00
4th Fiscal Quarter, Fiscal Year 2001 1.55:1.00
1st Fiscal Quarter, Fiscal Year 2002 1.60:1.00
2nd Fiscal Quarter, Fiscal Year 2002 1.60:1.00
3rd Fiscal Quarter, Fiscal Year 2002 1.60:1.00
4th Fiscal Quarter, Fiscal Year 2002 1.60:1.00
1st Fiscal Quarter, Fiscal Year 2003 1.60:1.00
2nd Fiscal Quarter, Fiscal Year 2003 1.60:1.00
3rd Fiscal Quarter, Fiscal Year 2003 1.60:1.00
4th Fiscal Quarter, Fiscal Year 2003 1.60:1.00
1st Fiscal Quarter, Fiscal Year 2004 and 1.70:1.00
each Fiscal Quarter thereafter
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E. MAXIMUM TOTAL DEBT TO TOTAL CAPITALIZATION. On the last day of any
Fiscal Quarter, Borrowers shall not permit the amount of Total Debt on such date
to exceed 55% of the amount of Total Capitalization on such date.
F. MINIMUM CONSOLIDATED TANGIBLE NET WORTH. Borrowers shall not permit
Consolidated Tangible Net Worth as of the last day of any given Fiscal Quarter
in any given Fiscal Year to be less than $1,400,000,000.
7.7 RESTRICTION ON FUNDAMENTAL CHANGES; ASSET SALES AND ACQUISITIONS.
Borrowers shall not, and shall not permit any of their Subsidiaries to,
alter the corporate, capital or legal structure of Borrowers or any of their
Subsidiaries (including issuing any preferred stock unless permitted hereunder),
or enter into any transaction of merger or consolidation, or liquidate, wind-up
or dissolve itself (or suffer any liquidation or dissolution), or convey, sell,
lease or sub-lease (as lessor or sublessor), transfer or otherwise dispose of,
in one transaction or a series of transactions, all or any part of its business,
property or assets, whether now owned or hereafter acquired, or acquire by
purchase or otherwise all or substantially all the business, property or fixed
assets of, or stock or other evidence of beneficial ownership of, any Person or
any division or line of business of any Person (other than purchases or other
acquisitions of inventory, materials and equipment in the ordinary course of
Borrowers', or any of their Subsidiaries', business), except:
(i) any Subsidiary of Borrowers may be merged with or into
Borrowers or any Subsidiary Guarantor, or be liquidated, wound up or
dissolved, or all or any part of any Subsidiary's business, property
or assets may be conveyed, sold, leased, transferred or otherwise
disposed of, in one transaction or a series of transactions, to
Borrowers or any Subsidiary Guarantor; PROVIDED that, in the case of
any merger, Borrowers or such Subsidiary Guarantor shall be the
continuing or surviving corporation;
(ii) Borrowers and their Subsidiaries may make Capital
Expenditures permitted under subsection 7.8 and Investments permitted
under subsection 7.3;
(iii) Borrowers and their Subsidiaries may sell or otherwise
dispose of assets in transactions that do not constitute Asset Sales;
PROVIDED that the consideration received for such assets shall be in
an amount at least equal to the fair market value thereof;
(iv) Borrowers and their Subsidiaries may make Asset Sales or
other sales (a) in any calendar year, of Lodging Assets which do not,
individually or in the aggregate, generate more than 15% of Lodging
EBITDA for the most recently ended four consecutive Fiscal Quarter
period and (b) of Healthcare Assets; provided that with respect to
Healthcare Assets (1) no single Asset Sales transaction or series of
related Asset Sales transactions involving consideration in excess of
$25,000,000 shall generate non-Cash consideration for the Borrowers or
their Subsidiaries in excess of 30% of the total consideration and (2)
no single Asset Sales transaction or series of related Asset Sales
transactions involving consideration in excess of
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$50,000,000 individually or in the aggregate, shall require Borrowers
to discount such Healthcare Assets by more than 50% of the net book
value thereof;
(v) Borrowers and their Subsidiaries may grant leases and
subleases to other Persons in the ordinary course of business not
materially interfering with the conduct of the business of Borrowers
or any of their Subsidiaries;
(vi) Borrowers may consummate the Conversion and make any name
changes required in connection therewith or otherwise PROVIDED that
Borrowers have provided Administrative Agent and Syndication Agent
with the items required in subsection 6.1(xviii) and any UCC financing
statement amendments necessary to continue the perfected security
interest in the Collateral pursuant to the Pledge Agreement, PROVIDED
FURTHER that no Potential Event of Default or Event of Default has
occurred and is continuing at the time of the proposed Conversion or
will occur as a result of any proposed Conversion; and
(vii) Borrowers and their Subsidiaries may enter into and
consummate the sale of Telematrix Equipment, Inc. and Telematrix
Equipment, LLC, which companies provide telecommunications products
and services.
7.8 CAPITAL EXPENDITURES.
A. Borrowers shall not, and shall not permit their Subsidiaries to,
make or incur Capital Expenditures in any Fiscal Year in excess of $95,000,000
(the "ANNUAL CAPEX AMOUNT"); PROVIDED that Permitted Reinvestment Capital
Expenditures and Investments shall not be included in Capital Expenditures for
purposes of determining the Annual CapEx Amount. If the amount of Capital
Expenditures incurred in any Fiscal Year is less than the Annual CapEx Amount
permitted pursuant to this subsection 7.8A, then the Annual CapEx Amount for the
following Fiscal Year may be increased by such unused amounts, provided that any
such increase shall not carry over to subsequent years.
B. In addition to Capital Expenditures permitted to be made pursuant to
subsection 7.8A, the Borrowers and their Subsidiaries may make Permitted
Reinvestment Capital Expenditures.
7.9 DISPOSAL OF SUBSIDIARY STOCK.
Except for any sale of 100% of the capital stock or other equity
Securities of any of their Subsidiaries in compliance with the provisions of
subsection 7.7, Borrowers shall not:
(i) directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity
Securities of any of their Subsidiaries, except to qualify directors
if required by applicable law; or
(ii) permit any of their Subsidiaries directly or indirectly to
sell, assign, pledge or otherwise encumber or dispose of any shares of
capital stock or other equity Securities of any of their Subsidiaries
(including such Subsidiary), except to
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Borrowers, another Subsidiary of Borrowers, or to qualify directors if
required by applicable law.
7.10 CONDUCT OF BUSINESS.
From and after the Closing Date, Borrowers shall not, and shall not
permit any of their Subsidiaries to, engage in any business other than (i) the
businesses engaged in by Borrowers and their Subsidiaries on the Closing Date
and similar or related businesses and any business related to the lodging
industry, and (ii) such other lines of business as may be consented to by
Requisite Lenders.
7.11 AMENDMENTS OR WAIVERS OF RELATED AGREEMENTS.
Unless the prior written consent of Requisite Lenders is obtained,
neither of the Borrowers nor any of their Subsidiaries will agree to any
amendment to any Senior Note Documents, Subordinated Indebtedness or Refinancing
Indebtedness if the effect of such amendment, together with all other amendments
made, is to increase the obligations of the obligor thereunder in a manner which
is materially adverse to Lenders or to confer any material additional rights on
the holders of such Indebtedness (or a trustee or other representative on their
behalf) in a manner which is materially adverse to Lenders or which would
otherwise be adverse in any material respect to the obligor thereunder or
Lenders; provided, however, that the 7.114% Senior Notes Due August 2011 may be
modified solely to provide that they shall be secured on an equal and ratable
basis with and in the same manner as the other Senior Notes, without the consent
of the Requisite Lenders.
7.12 FISCAL YEAR.
Borrowers shall not change their Fiscal Year-end from December 31,
PROVIDED that Borrowers may change their Fiscal Year-end date to a date which is
the last Saturday prior to or after December 31.
7.13 PUBLIC COMPANY.
Meditrust or Meditrust Operating Company shall not cease to have its
Common Stock listed on the NYSE, the American Stock Exchange, or the Nasdaq
Stock Exchange.
7.14 TRANSACTIONS WITH AFFILIATES.
Enter into any transaction with any Affiliate of Borrowers (other than
a Subsidiary), except (a) as permitted by this Agreement, (b) in the ordinary
course of business and pursuant to the reasonable requirements of the business
of Borrowers, and in each case of (a) and (b), upon fair and reasonable terms no
less favorable to such Person than would obtain in a comparable arm's length
transaction with a Person not such an Affiliate, (c) transactions between or
among Borrowers and their respective Subsidiaries, (d) employment, compensation
and indemnification arrangements with officers and directors of Borrowers and
their respective Subsidiaries, (e) fees payable in connection with directors'
fees and services rendered to the Board of Directors of Borrowers or their
respective Subsidiaries, or
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(f) loans and advances to officers and directors of Borrowers and their
respective Subsidiaries.
SECTION 8. EVENTS OF DEFAULT
If any of the following conditions or events ("EVENTS OF DEFAULT")
shall occur:
8.1 FAILURE TO MAKE PAYMENTS WHEN DUE.
Failure by Borrowers to pay any installment of principal of any Loan
when due, whether at stated maturity, by acceleration, by notice of voluntary
prepayment, by mandatory prepayment or otherwise; failure by Borrowers to pay
when due any amount payable to an Issuing Lender in reimbursement of any drawing
under a Letter of Credit; failure by Borrowers to pay any interest on any Loan
within five days of the due date; or failure by Borrowers to pay any fee or any
other amount due under this Agreement or the other Loan Documents within ten
days after the date due; or
8.2 DEFAULT IN OTHER AGREEMENTS.
(i) Failure of Borrowers or any of their Subsidiaries to pay when due
or purchase, redeem or otherwise acquire or offer to purchase, redeem or
otherwise acquire any principal of or interest on or any other amount payable in
respect of one or more items of Indebtedness (other than Indebtedness referred
to in subsection 8.1) or Contingent Obligations having an aggregate principal
amount (including undrawn committed or available amounts and including amounts
owing to all creditors under any combined or syndicated credit agreement) of
more than $15,000,000 in the aggregate, in each case beyond the end of any grace
period provided therefor; or (ii) breach or default by Borrowers or any of their
Subsidiaries with respect to any other material term of (a) one or more items of
Indebtedness or Contingent Obligations in the aggregate principal amounts
referred to in clause (i) above or (b) any loan agreement, mortgage, indenture
or other agreement relating to such item(s) of Indebtedness or Contingent
Obligation(s) (in such amounts), if the effect of such breach or default is to
cause, or to permit the holder or holders of that Indebtedness or Contingent
Obligation(s) (or a trustee on behalf of such holder or holders) to cause, that
Indebtedness or Contingent Obligation(s) to become or be declared due and
payable prior to its stated maturity or the stated maturity of any underlying
obligation (upon the giving or receiving of notice, lapse of time, both, or
otherwise) or (iii) any event shall occur under the terms of the Senior Note
Documents, the Subordinated Indebtedness or the Refinancing Indebtedness which
shall require Borrowers or any of their Subsidiaries to purchase, redeem or
otherwise acquire or offer to purchase, redeem or otherwise acquire all or any
portion of such Indebtedness of Borrowers except to the extent permitted by
subsection 7.5; or
8.3 BREACH OF CERTAIN COVENANTS.
Failure of Borrowers to perform or comply with any term or condition
contained in subsection 2.5 or 6.2 or Section 7 of this Agreement; or
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8.4 BREACH OF WARRANTY.
Any representation, warranty, certification or other statement made by
Borrowers or any of their Subsidiaries in any Loan Document or in any statement
or certificate at any time given by Borrowers or any of their Subsidiaries in
writing pursuant hereto or thereto or in connection herewith or therewith shall
be false in any material respect on the date as of which made; or
8.5 OTHER DEFAULTS UNDER LOAN DOCUMENTS.
The Loan Parties shall default in the performance of or compliance with
any material term contained in this Agreement or any of the other Loan
Documents, other than any such term referred to in any other subsection of this
Section 8, and such default shall not have been remedied or waived within 30
days after the earlier of (i) an Executive Officer of Borrowers or such Loan
Party becoming aware of such default or (ii) receipt by Borrowers and such Loan
Party of notice from Administrative Agent or any Lender of such default; or
8.6 INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) A court having jurisdiction in the premises shall enter a decree or
order for relief in respect of Borrowers or any of their Subsidiaries (other
than Immaterial Subsidiaries) in an involuntary case under the Bankruptcy Code
or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, which decree or order is not stayed; or any other similar
relief shall be granted under any applicable federal or state law; or (ii) an
involuntary case shall be commenced against Borrowers or any of their
Subsidiaries (other than Immaterial Subsidiaries) under the Bankruptcy Code or
under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect; or a decree or order of a court having jurisdiction in the
premises for the appointment of a receiver, liquidator, sequestrator, trustee,
custodian or other officer having similar powers over Borrowers or any of their
Subsidiaries (other than Immaterial Subsidiaries), or over all or a substantial
part of its property, shall have been entered; or there shall have occurred the
involuntary appointment of an interim receiver, trustee or other custodian of
Borrowers or any of their Subsidiaries (other than Immaterial Subsidiaries) for
all or a substantial part of its property; or a warrant of attachment, execution
or similar process shall have been issued against any substantial part of the
property of Borrowers or any of their Subsidiaries (other than Immaterial
Subsidiaries), and any such event described in this clause (ii) shall continue
for 60 days unless dismissed, bonded or discharged; or
8.7 VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC.
(i) Borrowers or any of their Subsidiaries (other than Immaterial
Subsidiaries) shall have an order for relief entered with respect to it or
commence a voluntary case under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect, or
shall consent to the entry of an order for relief in an involuntary case, or to
the conversion of an involuntary case to a voluntary case, under any such law,
or shall consent to the appointment of or taking possession by a receiver,
trustee or other custodian for all or a substantial part of its property; or
Borrowers or any of their
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Subsidiaries (other than Immaterial Subsidiaries) shall make any assignment for
the benefit of creditors; or (ii) Borrowers or any of their Subsidiaries (other
than Immaterial Subsidiaries) shall be unable, or shall fail generally, or shall
admit in writing its inability, to pay its debts as such debts become due; or
the Board of Directors of Borrowers or any of their Subsidiaries (other than
Immaterial Subsidiaries) (or any committee thereof) shall adopt any resolution
or otherwise authorize any action to approve any of the actions referred to in
clause (i) above or this clause (ii); or
8.8 JUDGMENTS AND ATTACHMENTS.
Any money judgment, writ or warrant of attachment or similar process
involving in the aggregate at any time an amount in excess of $15,000,000 (in
either case not adequately covered by insurance as to which a Solvent and
unaffiliated insurance company has acknowledged coverage) shall be entered or
filed against Borrowers or any of their Subsidiaries or any of their respective
assets and shall remain undischarged, unvacated, unbonded or unstayed for a
period of 30 days (or in any event later than five days prior to the date of any
proposed sale thereunder); or
8.9 DISSOLUTION.
Any order, judgment or decree shall be entered against Borrowers or any
of their Subsidiaries (other than Immaterial Subsidiaries) decreeing the
dissolution or split up of Borrowers or that Subsidiary and such order shall
remain undischarged or unstayed for a period in excess of 60 days; or
8.10 EMPLOYEE BENEFIT PLANS.
There shall occur one or more ERISA Events which individually or in the
aggregate results in or would reasonably be expected to result in liability of
Borrowers or any of their Subsidiaries or any of their respective ERISA
Affiliates in excess of $10,000,000 during the term of this Agreement; or there
shall exist an amount of unfunded benefit liabilities (as defined in Section
4001(a)(18) of ERISA), individually or in the aggregate for all Pension Plans
(if any) (excluding for purposes of such computation any Pension Plans (if any)
with respect to which assets exceed benefit liabilities), which exceeds
$10,000,000; or.
8.11 CHANGE IN CONTROL.
A Change in Control shall occur; or
8.12 INVALIDITY OF SUBSIDIARY GUARANTY; FAILURE OF SECURITY; REPUDIATION OF
OBLIGATIONS.
At any time after the execution and delivery thereof, (i) the
Subsidiary Guaranty for any reason other than the satisfaction in full of all
Obligations, shall cease to be in full force and effect (other than in
accordance with their terms) or shall be declared to be null and void, (ii) any
Collateral Document shall cease to be in full force and effect (other than by
reason of a release of Collateral thereunder in accordance with the terms hereof
or thereof, the satisfaction in full of the Obligations or any other termination
of such Collateral Document
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CREDIT AGREEMENT
in accordance with the terms hereof or thereof) or shall be declared null and
void, or Administrative Agent shall not have or shall cease to have a valid and
First Priority Lien in any Collateral with a value in excess of $5,000,000
purported to be covered thereby, in each case for any reason other than the
failure of Administrative Agent or any Lender to take any action within its
control, or (iii) any Loan Party shall contest the validity or enforceability of
any Loan Document in writing or deny in writing that it has any further
liability, including with respect to future advances by Lenders, under any Loan
Document to which it is a party; or
8.13 MATERIAL ADVERSE EFFECT.
Any event or change shall occur that has caused or evidences, either in
any case or in the aggregate, a Material Adverse Effect;
THEN (i) upon the occurrence of any Event of Default described in subsection 8.6
or 8.7, each of (a) the unpaid principal amount of and accrued interest on the
Loans, (b) an amount equal to the maximum amount that may at any time be drawn
under all Letters of Credit then outstanding (whether or not any beneficiary
under any such Letter of Credit shall have presented, or shall be entitled at
such time to present, the drafts or other documents or certificates required to
draw under such Letter of Credit), and (c) all other Obligations shall
automatically become immediately due and payable, without presentment, demand,
protest or other requirements of any kind, all of which are hereby expressly
waived by Borrowers, and the obligation of each Lender to make any Loan, the
obligation of any Issuing Lender to issue any Letter of Credit and the right of
any Issuing Lender to issue any Letter of Credit hereunder shall thereupon
terminate, and (ii) upon the occurrence and during the continuation of any other
Event of Default, Administrative Agent shall, upon the written request or with
the written consent of Requisite Lenders, by written notice to Borrowers,
declare all or any portion of the amounts described in clauses (a) through (c)
above to be, and the same shall forthwith become, immediately due and payable,
and the obligation of each Lender to make any Loan, the obligation of any
Issuing Lender to issue any Letter of Credit and the right of any Issuing Lender
to issue any Letter of Credit hereunder shall thereupon terminate; PROVIDED that
the foregoing shall not affect in any way the obligations of Revolving Lenders
under subsection 3.3C(i).
SECTION 9. ADMINISTRATIVE AGENT
9.1 APPOINTMENT.
A. APPOINTMENT OF ADMINISTRATIVE AGENT. CIBC is hereby appointed
Administrative Agent hereunder and under the other Loan Documents and each
Lender hereby authorizes Administrative Agent to act as its Administrative Agent
in accordance with the terms of this Agreement and the other Loan Documents.
Administrative Agent agrees to act upon the express conditions contained in this
Agreement and the other Loan Documents, as applicable. The provisions of this
Section 9 are solely for the benefit of Administrative Agent and Lenders and
Borrowers shall have no rights as a third party beneficiary of any of the
provisions thereof. In performing its functions and duties under this Agreement,
Administrative Agent shall act solely as an Administrative Agent of Lenders
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and does not assume and shall not be deemed to have assumed any obligation
towards or relationship of agency or trust with or for Borrowers or any of their
Subsidiaries.
B. APPOINTMENT OF SUPPLEMENTAL COLLATERAL AGENTS. It is the purpose of
this Agreement and the other Loan Documents that there shall be no violation of
any law of any jurisdiction denying or restricting the right of banking
corporations or associations to transact business as Administrative Agent or
trustee in such jurisdiction. It is recognized that in case of litigation under
this Agreement or any of the other Loan Documents, and in particular in case of
the enforcement of any of the Loan Documents, or in case Administrative Agent
deems that by reason of any present or future law of any jurisdiction it may not
exercise any of the rights, powers or remedies granted herein or in any of the
other Loan Documents or take any other action which may be desirable or
necessary in connection therewith, it may be necessary that Administrative Agent
appoint an additional individual or institution as a separate trustee,
co-trustee, Collateral Agent or collateral co-Administrative Agent (any such
additional individual or institution being referred to herein individually as a
"SUPPLEMENTAL COLLATERAL AGENT" and collectively as "SUPPLEMENTAL COLLATERAL
AGENTS").
In the event that Administrative Agent appoints a Supplemental
Collateral Agent with respect to any Collateral, (i) each and every right,
power, privilege or duty expressed or intended by this Agreement or any of the
other Loan Documents to be exercised by or vested in or conveyed to
Administrative Agent with respect to such Collateral shall be exercisable by and
vest in such Supplemental Collateral Agent to the extent, and only to the
extent, necessary to enable such Supplemental Collateral Agent to exercise such
rights, powers and privileges with respect to such Collateral and to perform
such duties with respect to such Collateral, and every covenant and obligation
contained in the Loan Documents and necessary to the exercise or performance
thereof by such Supplemental Collateral Agent shall run to and be enforceable by
either Administrative Agent or such Supplemental Collateral Agent, and (ii) the
provisions of this Section 9 and of subsections 10.2 and 10.3 that refer to
Administrative Agent shall inure to the benefit of such Supplemental Collateral
Agent and all references therein to Administrative Agent shall be deemed to be
references to Administrative Agent and/or such Supplemental Collateral Agent, as
the context may require.
Should any instrument in writing from Borrowers or any other Loan Party
be required by any Supplemental Collateral Agent so appointed by Administrative
Agent for more fully and certainly vesting in and confirming to him or it such
rights, powers, privileges and duties, Borrowers shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly
upon request by Administrative Agent. In case any Supplemental Collateral Agent,
or a successor thereto, shall die, become incapable of acting, resign or be
removed, all the rights, powers, privileges and duties of such Supplemental
Collateral Agent, to the extent permitted by law, shall vest in and be exercised
by Administrative Agent until the appointment of a new Supplemental Collateral
Agent.
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9.2 POWERS AND DUTIES; GENERAL IMMUNITY.
A. POWERS; DUTIES SPECIFIED. Each Lender irrevocably authorizes
Administrative Agent to take such action on such Lender's behalf and to exercise
such powers, rights and remedies hereunder and under the other Loan Documents as
are specifically delegated or granted to Administrative Agent by the terms
hereof and thereof, together with such powers, rights and remedies as are
reasonably incidental thereto. Administrative Agent shall have only those duties
and responsibilities that are expressly specified in this Agreement and the
other Loan Documents. Administrative Agent may exercise such powers, rights and
remedies and perform such duties by or through its Administrative Agents or
employees. Administrative Agent shall not have, by reason of this Agreement or
any of the other Loan Documents, a fiduciary relationship in respect of any
Lender; and nothing in this Agreement or any of the other Loan Documents,
expressed or implied, is intended to or shall be so construed as to impose upon
Administrative Agent any obligations in respect of this Agreement or any of the
other Loan Documents except as expressly set forth herein or therein.
B. NO RESPONSIBILITY FOR CERTAIN MATTERS. Administrative Agent shall
not be responsible to any Lender for the execution, effectiveness, genuineness,
validity, enforceability, collectibility or sufficiency of this Agreement or any
other Loan Document or for any representations, warranties, recitals or
statements made herein or therein or made in any written or oral statements or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Administrative Agent to Lenders or by
or on behalf of Borrowers to Administrative Agent or any Lender in connection
with the Loan Documents and the transactions contemplated thereby or for the
financial condition or business affairs of Borrowers or any other Person liable
for the payment of any Obligations, nor shall Administrative Agent be required
to ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained in any of the Loan
Documents or as to the use of the proceeds of the Loans the use of the Letters
of Credit or as to the existence or possible existence of any Event of Default
or Potential Event of Default. Anything contained in this Agreement to the
contrary notwithstanding, Administrative Agent shall not have any liability
arising from confirmations of the amount of outstanding Loans or the Letter of
Credit Usage or the component amounts thereof.
C. EXCULPATORY PROVISIONS. Neither Administrative Agent nor any of its
officers, directors, employees or Administrative Agents shall be liable to
Lenders for any action taken or omitted by Administrative Agent under or in
connection with any of the Loan Documents except to the extent caused by
Administrative Agent's gross negligence or willful misconduct. Administrative
Agent shall be entitled to refrain from any act or the taking of any action
(including the failure to take an action) in connection with this Agreement or
any of the other Loan Documents or from the exercise of any power, discretion or
authority vested in it hereunder or thereunder unless and until Administrative
Agent shall have received instructions in respect thereof from Requisite Lenders
(or such other Lenders as may be required to give such instructions under
subsection 10.6) and, upon receipt of such instructions from Requisite Lenders
(or such other Lenders, as the case may be), Administrative Agent shall be
entitled to act or (where so instructed) refrain from acting,
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or to exercise such power, discretion or authority, in accordance with such
instructions. Without prejudice to the generality of the foregoing, (i)
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any communication, instrument or document believed by it to be
genuine and correct and to have been signed or sent by the proper person or
persons, and shall be entitled to rely and shall be protected in relying on
opinions and judgments of attorneys (who may be attorneys for Borrowers and
their Subsidiaries), accountants, experts and other professional advisors
selected by it; and (ii) no Lender shall have any right of action whatsoever
against Administrative Agent as a result of Administrative Agent acting or
(where so instructed) refraining from acting under this Agreement or any of the
other Loan Documents in accordance with the instructions of Requisite Lenders
(or such other Lenders as may be required to give such instructions under
subsection 10.6).
D. ADMINISTRATIVE AGENT ENTITLED TO ACT AS LENDER. The agency hereby
created shall in no way impair or affect any of the rights and powers of, or
impose any duties or obligations upon, Administrative Agent in its individual
capacity as a Lender hereunder. With respect to its participation in the Loans
and the Letters of Credit, Administrative Agent shall have the same rights and
powers hereunder as any other Lender and may exercise the same as though it were
not performing the duties and functions delegated to it hereunder, and the term
"Lender" or "Lenders" or any similar term shall, unless the context clearly
otherwise indicates, include Administrative Agent in its individual capacity.
Administrative Agent and its Affiliates may accept deposits from, lend money to
and generally engage in any kind of banking, trust, financial advisory or other
business with Borrowers or any of its Affiliates as if it were not performing
the duties specified herein, and may accept fees and other consideration from
Borrowers for services in connection with this Agreement and otherwise without
having to account for the same to Lenders.
9.3 REPRESENTATIONS AND WARRANTIES; NO RESPONSIBILITY FOR APPRAISAL OF
CREDITWORTHINESS.
Each Lender represents and warrants that it has made its own
independent investigation of the financial condition and affairs of Borrowers
and their Subsidiaries in connection with the making of the Loans hereunder and
that it has made and shall continue to make its own appraisal of the
creditworthiness of Borrowers and their Subsidiaries. Administrative Agent shall
not have any duty or responsibility, either initially or on a continuing basis,
to make any such investigation or any such appraisal on behalf of Lenders or to
provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the making of the Loans or at any time
or times thereafter, and Administrative Agent shall not have any responsibility
with respect to the accuracy of or the completeness of any information provided
to Lenders.
9.4 RIGHT TO INDEMNITY.
Each Lender, in proportion to its Pro Rata Share, severally agrees to
indemnify Administrative Agent, to the extent that Administrative Agent shall
not have been reimbursed by Borrowers, for and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including counsel fees and
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disbursements) or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against Administrative Agent in exercising
its powers, rights and remedies or performing its duties hereunder or under the
other Loan Documents or otherwise in its capacity as Administrative Agent in any
way relating to or arising out of this Agreement or the other 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 Administrative Agent's gross negligence
or willful misconduct. If any indemnity furnished to Administrative Agent for
any purpose shall, in the opinion of Administrative Agent, be insufficient or
become impaired, Administrative Agent may call for additional indemnity and
cease, or not commence, to do the acts indemnified against until such additional
indemnity is furnished.
9.5 SUCCESSOR ADMINISTRATIVE AGENT.
Administrative Agent may resign at any time by giving 30 days' prior
written notice thereof to Lenders and Borrowers, and Administrative Agent may be
removed at any time with or without cause by an instrument or concurrent
instruments in writing delivered to Borrowers and Administrative Agent and
signed by Requisite Lenders. Upon any such notice of resignation or any such
removal, Requisite Lenders shall have the right, upon five Business Days' notice
to Borrowers, to appoint a successor Administrative Agent with the consent of
Borrowers which shall not be unreasonably withheld and shall not be required
after the occurrence of a Potential Event of Default or an Event of Default.
Upon the acceptance of any appointment as Administrative Agent hereunder by a
successor Administrative Agent, that successor Administrative Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring or removed Administrative Agent and the retiring or
removed Administrative Agent shall be discharged from its duties and obligations
under this Agreement. After any retiring or removed Administrative Agent's
resignation or removal hereunder as Administrative Agent, the provisions of this
Section 9 shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Administrative Agent under this Agreement.
9.6 COLLATERAL DOCUMENTS AND SUBSIDIARY GUARANTY.
Each Lender hereby further authorizes Administrative Agent, on behalf
of and for the benefit of Lenders, to enter into each Collateral Document as
secured party and to be Administrative Agent for and representative of Lenders
under the Subsidiary Guaranty, and each Lender agrees to be bound by the terms
of each Collateral Document and the Subsidiary Guaranty; PROVIDED that
Administrative Agent shall not (i) enter into or consent to any material
amendment, modification, termination or waiver of any provision contained in any
Collateral Document or the Subsidiary Guaranty or (ii) release any Collateral
(except as otherwise expressly permitted or required pursuant to the terms of
this Agreement or the applicable Collateral Document), in each case without the
prior consent of Requisite Lenders (or, if required pursuant to subsection 10.6,
all Lenders); PROVIDED FURTHER, however, that, without further written consent
or authorization from Lenders, Administrative Agent may execute any documents or
instruments necessary to (a) release any Lien encumbering any item of Collateral
that is the subject of a sale or other disposition of assets permitted by this
Agreement or to which Requisite Lenders have otherwise consented or (b) release
any
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Subsidiary Guarantor from the Subsidiary Guaranty if all of the capital stock of
such Subsidiary Guarantor is sold to any Person (other than an Affiliate of
Borrowers) pursuant to a sale or other disposition permitted hereunder or to
which Requisite Lenders have otherwise consented. Anything contained in any of
the Loan Documents to the contrary notwithstanding, Borrowers, Administrative
Agent and each Lender hereby agree that (X) no Lender shall have any right
individually to realize upon any of the Collateral under any Collateral Document
or to enforce the Subsidiary Guaranty, it being understood and agreed that all
powers, rights and remedies under the Collateral Documents and the Subsidiary
Guaranty may be exercised solely by Administrative Agent for the benefit of
Lenders in accordance with the terms thereof, and (Y) in the event of a
foreclosure by Administrative Agent on any of the Collateral pursuant to a
public or private sale, Administrative Agent or any Lender may be the purchaser
of any or all of such Collateral at any such sale and Administrative Agent, as
Administrative Agent for and representative of Lenders (but not any Lender or
Lenders in its or their respective individual capacities unless Requisite
Lenders shall otherwise agree in writing) shall be entitled, for the purpose of
bidding and making settlement or payment of the purchase price for all or any
portion of the Collateral sold at any such public sale, to use and apply any of
the Obligations as a credit on account of the purchase price for any Collateral
payable by Administrative Agent at such sale.
SECTION 10. MISCELLANEOUS
10.1 ASSIGNMENTS AND PARTICIPATIONS IN LOANS.
A. GENERAL. Subject to subsections 10.1B and 10.1C, each Lender shall
have the right at any time to (i) sell, assign or transfer to any Eligible
Assignee, or (ii) sell participations to any Person in, all or any part of its
Commitments or any Loan or Loans made by it or its Letters of Credit or
participations therein or any other interest herein or in any other Obligations
owed to it; PROVIDED that no such sale, assignment, transfer or participation
shall, without the consent of Borrowers, require Borrowers to file a
registration statement with the Securities and Exchange Commission or apply to
qualify such sale, assignment, transfer or participation under the securities
laws of any state; PROVIDED, FURTHER, that no such sale, assignment or transfer
described in clause (i) above shall be effective unless and until an Assignment
Agreement effecting such sale, assignment or transfer shall have been accepted
by Administrative Agent and recorded in the Register as provided in subsection
10.1B(ii); PROVIDED, FURTHER, that no such sale, assignment, transfer or
participation of any Letter of Credit or any participation therein may be made
separately from a sale, assignment, transfer or participation of a corresponding
interest in the Revolving Loan Commitment and the Revolving Loans of the Lender
effecting such sale, assignment, transfer or participation. Except as otherwise
provided in this subsection 10.1, no Lender shall, as between Borrowers and such
Lender, be relieved of any of its obligations hereunder as a result of any sale,
assignment or transfer of, or any granting of participations in, all or any part
of its Commitments or the Loans, or participations therein, or the other
Obligations owed to such Lender, and such Lender shall remain solely responsible
for the performance of such Obligations, and Borrowers shall continue to deal
solely and directly with such Lender in connection with such Lender's rights and
obligations under this Agreement.
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B. ASSIGNMENTS.
(i) AMOUNTS AND TERMS OF ASSIGNMENTS. Each Commitment, Loan,
Letter of Credit or participation therein, or other Obligation may (a)
be assigned in any amount to another Lender, or to an Affiliate or
Approved Fund of the assigning Lender or another Lender, with the
giving of notice to Borrowers and Administrative Agent or (b) be
assigned in an aggregate amount of not less than $1,000,000, in the
case of any assignment of a Revolving Loan or Revolving Loan
Commitment, or $1,000,000, in the case of any assignment of a Term
Loan or Letter of Credit (or such lesser amount as shall constitute
the aggregate amount of the Commitments, Loans, Letters of Credit and
participations therein, and other Obligations of the assigning Lender)
to any other Eligible Assignee (treating any two or more Approved
Funds with the same investment advisor as a single Eligible Assignee)
with the giving of notice to Borrowers and with the consent of
Borrowers (unless a Potential Event of Default or an Event of Default
has occurred and is continuing or, with respect to assignments of Term
Loans, such assignment is made within ten (10) Business Days of the
Closing Date) and Administrative Agent shall have consented (which
consent of Borrowers and Administrative Agent shall not be
unreasonably withheld or delayed). To the extent of any such
assignment in accordance with either clause (a) or (b) above, the
assigning Lender shall be relieved of its obligations with respect to
its Commitments, Loans, Letters of Credit or participations therein,
or other Obligations or the portion thereof so assigned. The parties
to each such assignment shall execute and deliver to Administrative
Agent, for its acceptance and recording in the Register, an Assignment
Agreement, together with a processing and recordation fee of $3,500
(except that no such registration and processing fee shall be payable
in the case of an Assignee which is an Affiliate of the Assignor or a
Person under common management with the Assignor), and such forms
(including an administrative questionnaire if the Eligible Assignee is
not a Lender), certificates or other evidence, if any, with respect to
United States federal income tax withholding matters as the assignee
under such Assignment Agreement may be required to deliver to
Administrative Agent pursuant to subsection 2.7B(iii)(a). Upon such
execution, delivery, acceptance and recordation, from and after the
effective date specified in such Assignment Agreement, (y) the
assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to
such Assignment Agreement, shall have the rights and obligations of a
Lender hereunder, and (z) the assigning Lender thereunder shall, to
the extent that rights and obligations hereunder have been assigned by
it pursuant to such Assignment Agreement, relinquish its rights (other
than any rights which survive the termination of this Agreement under
subsection 10.9B) and be released from its obligations under this
Agreement (and, in the case of an Assignment Agreement covering all or
the remaining portion of an assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto;
PROVIDED that, anything contained in any of the Loan Documents to the
contrary notwithstanding, if such Lender is the Issuing Lender with
respect to any outstanding Letters of Credit such Lender shall
continue to have all rights and obligations of an Issuing Lender with
respect to such Letters of Credit until the cancellation or expiration
of such Letters of Credit and the reimbursement of any amounts drawn
thereunder). The Commitments
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hereunder shall be modified to reflect the Commitment of such assignee
and any remaining Commitment of such assigning Lender and, if any such
assignment occurs after the issuance of any Notes hereunder, the
assigning Lender shall, upon the effectiveness of such assignment or
as promptly thereafter as practicable, surrender its applicable Notes,
if any, to Administrative Agent for cancellation, and thereupon new
Notes shall, if so requested by the assignee and/or the assigning
Lender in accordance with subsection 2.1D, be issued to the assignee
and/or to the assigning Lender, substantially in the form of EXHIBIT
IV or EXHIBIT V annexed hereto, as the case may be, with appropriate
insertions, to reflect the new Commitments and/or outstanding Term
Loan, as the case may be, of the assignee and/or the assigning Lender.
Any assignment or transfer by a Lender of rights or obligations under
this Agreement that does not comply with this subsection 10.1B shall
be treated for purposes of this Agreement as a sale by such Lender of
a participation in such rights and obligations in accordance with
subsection 10.1C.
(ii) ACCEPTANCE BY ADMINISTRATIVE AGENT; RECORDATION IN REGISTER.
Upon its receipt of an Assignment Agreement executed by an assigning
Lender and an assignee representing that it is an Eligible Assignee,
together with the processing and recordation fee referred to in
subsection 10.1B(i) and any forms, certificates or other evidence with
respect to United States federal income tax withholding matters that
such assignee may be required to deliver to Administrative Agent
pursuant to subsection 2.7B(iii)(a), Administrative Agent shall, if
Administrative Agent (and if necessary, Borrowers) has consented to
the assignment evidenced thereby (in each case to the extent such
consent is required pursuant to subsection 10.1B(i)), (a) accept such
Assignment Agreement by executing a counterpart thereof as provided
therein (which acceptance shall evidence any required consent of
Administrative Agent to such assignment), (b) record the information
contained therein in the Register, and (c) give prompt notice thereof
to Borrowers. Administrative Agent shall maintain a copy of each
Assignment Agreement delivered to and accepted by it as provided in
this subsection 10.1B(ii).
C. PARTICIPATIONS. Any Lender may, without the consent of, or notice
to, Borrowers or Administrative Agent, sell participations to one or more banks
or other entities (a "PARTICIPANT") in all or a portion of such Lender's rights
and/or obligations under this Agreement (including all or a portion of its
Commitment and/or the Loans owing to it); PROVIDED that (i) such Lender's
obligations under this Agreement shall remain unchanged, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and (iii) Borrowers, Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce the Loan
Documents and to approve any amendment, modification or waiver of any provision
of the Loan Documents; PROVIDED that such agreement or instrument may provide
that such Lender will not, without the consent of such Participant, agree to any
amendment, modification or waiver that affects such Participant if such
amendment, modification or waiver requires the unanimous written consent of all
Lenders pursuant to subsection 10.6. Subject to subsection 10.1D, Borrower
agrees that
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each Participant shall be entitled to the benefits of subsections 2.6D, 2.7, and
3.6 to the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to this subsection 10.1C; PROVIDED, HOWEVER, that in no
event shall Borrowers be obligated to make any payment with respect to such
subsections which is greater than the amount that Borrowers would have paid to
the Lender had no such participation been sold. To the extent permitted by law,
in the event that any amounts outstanding under this Agreement are due and
unpaid, or shall have been declared or shall have become due and payable upon
the occurrence of an Event of Default, each participant shall be deemed to have
the right of set-off in respect of its participating interest in amounts owing
under this Agreement to the same extent as if the amount of its participating
interest were owing directly to it as a Lender under this Agreement.
D. A Participant shall not be entitled to receive any greater payment
under subsections 2.6D, 2.7, and 3.6 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with Borrower's
prior written consent. A Participant that would be a Non-US Lender if it were a
Lender shall not be entitled to the benefits of subsection 2.7 unless Borrowers
are notified of the participation sold to such Participant and such Participant
agrees, for the benefit of Borrowers, to comply with subsection 2.7B(iii) as
though it were a Lender.
E. ASSIGNMENTS TO SECURED PARTIES AND TRUSTEES. In addition to the
assignments and participations permitted under the foregoing provisions of this
subsection 10.1, (a) any Lender may assign and pledge all or any portion of its
Loans, the other Obligations owed to such Lender, and its Notes to any creditor,
including Federal Reserve Bank, as collateral security pursuant to Regulation A
of the Board of Governors of the Federal Reserve System and any operating
circular issued by such Federal Reserve Bank; PROVIDED that (i) no Lender shall,
as between Borrowers and such Lender, be relieved of any of its obligations
hereunder as a result of any such assignment and pledge and (ii) in no event
shall such creditor be considered to be a "Lender" or be entitled to require the
assigning Lender to take or omit to take any action hereunder, and (b) any
Lender which is a Fund may pledge its Notes to its trustee for the benefit of
the Fund's investors.
F. INFORMATION. Each Lender may furnish any information concerning
Borrowers and their Subsidiaries in the possession of that Lender from time to
time to assignees and participants (including prospective assignees and
participants), subject to subsection 10.19.
G. REPRESENTATIONS OF LENDERS. Each Lender which is the recipient of an
Allocation Letter and a party to this Agreement hereby represents and warrants
(i) that it is an Eligible Assignee described in clause (A) of the definition
thereof; (ii) that it has experience and expertise in the making of loans such
as the Loans; and (iii) that it will make its Loans for its own account in the
ordinary course of its business and without a view to distribution of such Loans
within the meaning of the Securities Act or the Exchange Act or other federal
securities laws (it being understood that, subject to the provisions of this
subsection 10.1, the disposition of such Loans or any interests therein shall at
all times remain within its exclusive control). Each Lender that becomes a party
hereto pursuant to an
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Assignment Agreement shall be deemed to agree that the representations and
warranties of such Lender contained in Section 2(c) of such Assignment Agreement
are incorporated herein by this reference.
10.2 EXPENSES.
Whether or not the transactions contemplated hereby shall be
consummated, Borrowers agree to pay promptly (i) all the actual and reasonable
costs and expenses of preparation of the Loan Documents and any consents,
amendments, waivers or other modifications thereto; (ii) all the costs of
furnishing all opinions by counsel for Borrowers (including any opinions
requested by Lenders as to any legal matters arising hereunder) and of
Borrowers' performance of and compliance with all agreements and conditions on
their part to be performed or complied with under this Agreement and the other
Loan Documents including with respect to confirming compliance with
environmental, insurance and solvency requirements; (iii) the reasonable fees,
expenses and disbursements of counsel to Administrative Agent in connection with
the negotiation, preparation, execution and administration of the Loan Documents
and any consents, amendments, waivers or other modifications thereto and any
other documents or matters requested by Borrowers; (iv) all the actual and
reasonable costs and expenses of creating and perfecting Liens in favor of
Administrative Agent on behalf of Lenders pursuant to any Collateral Document
prior to and after the Closing Date, including filing fees, search fees, and
reasonable fees, expenses and disbursements of counsel to Administrative Agent
and of counsel providing any opinions that Administrative Agent or Requisite
Lenders may reasonably request in respect of the Collateral Documents or the
Liens created pursuant thereto; (v) the custody or preservation of any of the
Collateral; (vi) all other actual and reasonable costs and expenses incurred by
Administrative Agent in connection with the syndication of the Commitments and
the negotiation, preparation and execution of the Loan Documents and any
consents, amendments, waivers or other modifications thereto and the
transactions contemplated thereby; and (vii) after the occurrence of an Event of
Default, all costs and expenses, including reasonable attorneys' fees (including
allocated costs of internal counsel) and costs of settlement, incurred by
Administrative Agent and Lenders in enforcing any Obligations of or in
collecting any payments due from any Loan Party hereunder or under the other
Loan Documents by reason of such Event of Default (including in connection with
the sale of, collection from, or other realization upon any of the Collateral or
the enforcement of the Subsidiary Guaranty) or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings.
10.3 INDEMNITY.
In addition to the payment of expenses pursuant to subsection 10.2,
whether or not the transactions contemplated hereby shall be consummated,
Borrowers agree to defend (subject to Indemnitees' selection of counsel),
indemnify, pay and hold harmless Administrative Agent and Lenders, and the
officers, directors, employees, counsel, agents, representatives, advisors and
affiliates of Administrative Agent and Lenders (collectively called the
"INDEMNITEES"), from and against any and all Indemnified Liabilities (as
hereinafter defined); PROVIDED that Borrowers shall not have any obligation to
any
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Indemnitee hereunder with respect to any Indemnified Liabilities to the extent
such Indemnified Liabilities arise solely from the gross negligence or willful
misconduct of that Indemnitee as determined by a final judgment of a court of
competent jurisdiction.
As used herein, "INDEMNIFIED LIABILITIES" means, collectively, any and
all liabilities, obligations, losses, damages (including natural resource
damages), penalties, actions, judgments, suits, claims (including Environmental
Claims), costs (including the costs of any investigation, study, sampling,
testing, abatement, cleanup, removal, remediation or other response action
necessary to remove, remediate, clean up or abate any Hazardous Materials
Activity), expenses and disbursements of any kind or nature whatsoever
(including the reasonable fees and disbursements of counsel for Indemnitees in
connection with any investigative, administrative or judicial proceeding
commenced or threatened by any Person, whether or not any such Indemnitee shall
be designated as a party or a potential party thereto, and any fees or expenses
incurred by Indemnitees in enforcing this indemnity), whether direct and whether
based on any federal, state or foreign laws, statutes, rules or regulations
(including securities and commercial laws, statutes, rules or regulations and
Environmental Laws), on common law or equitable cause or on contract or
otherwise, that may be imposed on, incurred by, or asserted against any such
Indemnitee, in any manner relating to or arising out of (i) this Agreement or
the other Loan Documents or the Related Agreements or the transactions
contemplated hereby or thereby (including Lenders' agreement to make the Loans
hereunder or the use or intended use of the proceeds thereof or the issuance of
Letters of Credit hereunder or the use or intended use of any thereof, or any
enforcement of any of the Loan Documents (including any sale of, collection
from, or other realization upon any of the Collateral or the enforcement of the
Subsidiary Guaranty), (ii) the statements contained in the commitment letter
delivered by any Lender to Borrowers with respect thereto, or (iii) any
Environmental Claim or any Hazardous Materials Activity relating to or arising
from, directly or indirectly, any past or present activity, operation, land
ownership, or practice of Borrowers or any of their Subsidiaries.
To the extent that the undertakings to defend, indemnify, pay and hold
harmless set forth in this subsection 10.3 may be unenforceable in whole or in
part because they are violative of any law or public policy, Borrowers shall
contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities
incurred by Indemnitees or any of them.
10.4 SET-OFF.
In addition to any rights now or hereafter granted under applicable law
and not by way of limitation of any such rights, upon the occurrence of any
Event of Default each Lender is hereby authorized by Borrowers at any time or
from time to time, without notice to Borrowers or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits or other amounts held by any Lender for the credit or
account of Borrowers (general or special, including Indebtedness evidenced by
certificates of deposit, whether matured or unmatured, but not including trust
accounts) and any other Indebtedness at any time held or owing by that Lender to
or for the credit or the account of Borrowers against and on account of the
obligations and liabilities of Borrowers to that Lender under this Agreement,
the Letters of Credit and participations therein and the
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other Loan Documents, including all claims of any nature or description arising
out of or connected with this Agreement, the Letters of Credit and
participations therein or any other Loan Document, irrespective of whether or
not (i) that Lender shall have made any demand hereunder or (ii) the principal
of or the interest on the Loans or any amounts in respect of the Letters of
Credit or any other amounts due hereunder or under any of the other Loan
Documents shall have become due and payable pursuant to Section 8 and although
said obligations and liabilities, or any of them, may be contingent or
unmatured. Borrowers hereby further grant to Administrative Agent and each
Lender a security interest in all deposits and accounts maintained with
Administrative Agent or such Lender as security for the Obligations.
10.5 RATABLE SHARING.
Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization upon
security, through the exercise of any right of set-off or banker's lien, by
counterclaim or cross action or by the enforcement of any right under the Loan
Documents or otherwise, or as adequate protection of a deposit treated as cash
collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of Letters of Credit, fees and other amounts then due and owing to that
Lender hereunder or under the other Loan Documents (collectively, the "AGGREGATE
AMOUNTS DUE" to such Lender) that is greater than the proportion received by any
other Lender in respect of the Aggregate Amounts Due to such other Lender, then
the Lender receiving such proportionately greater payment shall (i) notify
Administrative Agent and each other Lender of the receipt of such payment and
(ii) apply a portion of such payment to purchase participations (which it shall
be deemed to have purchased from each seller of a participation simultaneously
upon the receipt by such seller of its portion of such payment) in the Aggregate
Amounts Due to the other Lenders so that all such recoveries of Aggregate
Amounts Due shall be shared by all Lenders in proportion to the Aggregate
Amounts Due to them; PROVIDED that if all or part of such proportionately
greater payment received by such purchasing Lender is thereafter recovered from
such Lender upon the bankruptcy or reorganization of Borrowers or otherwise (and
whether by litigation, demand, settlement or otherwise), those purchases shall
be rescinded and the purchase prices paid for such participations shall be
returned to such purchasing Lender ratably to the extent of such recovery, but
without interest. Borrowers expressly consent to the foregoing arrangement and
agrees that any holder of a participation so purchased may exercise any and all
rights of banker's lien, set-off or counterclaim with respect to any and all
monies owing by Borrowers to that holder with respect thereto as fully as if
that holder were owed the amount of the participation held by that holder.
10.6 AMENDMENTS AND WAIVERS.
No amendment, modification, termination or waiver of any provision of
this Agreement or of the Notes or of any of the other Loan Documents, and no
consent to any departure by Borrowers herefrom or therefrom, shall in any event
be effective without the written concurrence of Requisite Lenders; PROVIDED THAT
in addition,
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(a) any such amendment, modification, termination, waiver or
consent which:
(i) postpones the date or reduces the amount of any scheduled
payment (but not prepayment) of principal of any of the Loans;
(ii) postpones the date on which any interest or any fees are
payable or reduces the amount of any fees payable hereunder;
(iii) changes in any manner the definition of "Pro Rata Share",
the definition of "Class", the definition of "Requisite Class Lenders"
or the definition of "Requisite Lenders";
(iv) changes in any manner any provision of this Agreement which,
by its terms, expressly requires the approval or concurrence of all
Lenders;
(v) releases any Lien granted in favor of Administrative Agent
with respect to all or substantially all of the Collateral;
(vi) releases from their obligations under the Subsidiary
Guaranty, Subsidiary Guarantors which individually or in the aggregate
own assets with an aggregate value for such Subsidiary Guarantors on
such release dates, as reasonably determined by Administrative Agent,
in excess of 50% of the total value of the assets owned by Borrowers
and their Subsidiaries on March 31, 2001 (as adjusted for the April
31, 2001 dispositions), in each case other than those releases not
requiring a vote of the Lenders in accordance with the terms of the
Loan Documents (each released Subsidiary Guarantor shall be referred
to as a "Released Guarantor" if the release of such Person's
obligations under a Subsidiary Guaranty is not evidenced by the
written concurrence of all Lenders); or
(vii) waives or changes in any manner the provisions contained in
subsection 8.1 or this subsection 10.6,
shall be effective only if evidenced by the written concurrence of all Lenders;
provided, however, that with respect to clause (vi) above only the written
concurrence of all Lenders minus one shall be required (if such one Lender by
itself constitutes Requisite Lenders, then its concurrence shall also be
required); provided, further, however, with respect to any such Released
Guarantor, (i) stock of such Released Guarantor may be subjected to Liens only
as and to the extent such Liens would have been permitted under subsection 7.2
with respect to a Subsidiary Guarantor (or other provisions or schedule
incorporated in such subsection and as applied in such subsection) as in effect
on the Closing Date and (ii) such Released Guarantor shall be permitted to enter
into Contingent Obligations only as and to the extent any such Contingent
Obligations would have been permitted under subsection 7.4 with respect to a
Subsidiary Guarantor (or other provisions or schedule incorporated in such
subsection and as applied in such subsection) as in effect on the Closing Date;
provided, further, however, that any amendment, modification, termination or
waiver to subsection 7.2 or subsection 7.4 (or other provisions or schedule
incorporated in either of such subsections and as applied therein) which has the
effect of increasing (x) the Liens to which stock of a
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Released Guarantor could be subject or (y) the amount or nature of Contingent
Obligations permitted to be entered into by a Released Guarantor, as applicable,
shall only apply to such Released Guarantors if such amendment, modification,
termination or waiver is approved with the written concurrence of all Lenders
minus one (if such one Lender by itself constitutes Requisite Lenders, then its
concurrence shall also be required)(any Released Guarantor which executes a
counterpart Subsidiary Guaranty shall no longer constitute a Released
Guarantor). Notwithstanding the foregoing provisions of this subsection 10.6,
any amendment to this Agreement or the other Loan Documents in connection with a
permitted Conversion and deemed reasonably necessary by Administrative Agent and
Syndication Agent shall not require the consent of Requisite Lenders and shall
only require the consent of Administrative Agent and Syndication Agent.
In addition,
(a) no amendment, modification, termination or waiver of any
provision of any Note shall be effective without the written
concurrence of the Lender which is the holder of that Note;
(b) no amendment, modification, termination or waiver of any
provision of subsection 2.1A(i)-(ii) or of any other provision of this
Agreement relating to the Term Loan Commitments or the Revolving Loan
Commitments shall increase the Commitments of any Lender over the
amount thereof then in effect without the consent of such Lender (it
being understood that amendments, modifications or waivers of
conditions precedent, representations and warranties, covenants or
Events of Default or of a mandatory reduction in the Commitments shall
not constitute an increase of the Commitment of any Lender, and that
an increase in the available portion of any Commitment of any Lender
shall not constitute an increase in the Commitment of such Lender);
(c) no amendment, modification, termination or waiver of any
provision of Section 9 or of any other provision of this Agreement
which, by its terms, expressly requires the approval or concurrence of
Administrative Agent shall be effective without the written
concurrence of Administrative Agent;
(d) no amendment, modification, termination or waiver of any
provision of subsection 2.4 which changes or waives any voluntary and
mandatory prepayments, call protection or the ability of any Term Loan
Lender to waive the right to receive any voluntary or mandatory
prepayment, or reducing Commitments applicable to any Class shall be
effective without the written concurrence of Requisite Class Lenders
of such Class; and
(e) no amendment, modification, termination or waiver of any
provision of subsection 2.2 which decreases the interest rate borne by
Loans of any Class (other than any waiver of any increase in the
interest rate applicable to such Loans pursuant to subsection 2.2E) or
the percentages set forth in the definitions of "Applicable Base
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Rate Margin" and "Applicable LIBOR Margin" shall be effective without
the written concurrence of all Lenders of such Class.
Administrative Agent may, but shall have no obligation to, with the
concurrence of any Lender, execute amendments, modifications, waivers or
consents on behalf of that Lender. Any waiver or consent shall be effective only
in the specific instance and for the specific purpose for which it was given. No
notice to or demand on Borrowers in any case shall entitle Borrowers to any
other or further notice or demand in similar or other circumstances. Any
amendment, modification, termination, waiver or consent effected in accordance
with this subsection 10.6 shall be binding upon each Lender at the time
outstanding, each future Lender and, if signed by Borrowers, on Borrowers.
10.7 INDEPENDENCE OF COVENANTS.
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or would otherwise be within
the limitations of, another covenant shall not avoid the occurrence of an Event
of Default or Potential Event of Default if such action is taken or condition
exists.
10.8 NOTICES.
Unless otherwise specifically provided herein, any notice or other
communication herein required or permitted to be given shall be in writing and
may be personally served, telexed or sent by telefacsimile or United States mail
or courier service and shall be deemed to have been given when delivered in
person or by courier service, upon receipt of telefacsimile or telex, or three
Business Days after depositing it in the United States mail with postage prepaid
and properly addressed; PROVIDED that notices to Administrative Agent shall not
be effective until received. For the purposes hereof, the address of each party
hereto shall be as set forth under such party's name on the signature pages
hereof or (i) as to Borrowers and Administrative Agent, such other address as
shall be designated by such Person in a written notice delivered to the other
parties hereto and (ii) as to each other party, such other address as shall be
designated by such party in a written notice delivered to Administrative Agent.
10.9 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
A. All representations, warranties and agreements made herein shall
survive the execution and delivery of this Agreement and the making of the Loans
and the issuance of the Letters of Credit hereunder.
B. Notwithstanding anything in this Agreement or implied by law to the
contrary, the agreements of Borrowers set forth in subsections 2.6D, 2.7, 3.5A,
3.6, 10.2, 10.3 and 10.4 and the agreements of Lenders set forth in subsections
9.2C, 9.4 and 10.5 shall survive the payment of the Loans, the cancellation or
expiration of the Letters of Credit and the reimbursement of any amounts drawn
thereunder, and the termination of this Agreement.
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10.10 FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of Administrative Agent or any Lender
in the exercise of any power, right or privilege hereunder or under any other
Loan Document shall impair such power, right or privilege or be construed to be
a waiver of any default or acquiescence therein, nor shall any single or partial
exercise of any such power, right or privilege preclude other or further
exercise thereof or of any other power, right or privilege. All rights and
remedies existing under this Agreement and the other Loan Documents are
cumulative to, and not exclusive of, any rights or remedies otherwise available.
10.11 MARSHALLING; PAYMENTS SET ASIDE.
Neither Administrative Agent nor any Lender shall be under any
obligation to marshal any assets in favor of Borrowers or any other party or
against or in payment of any or all of the Obligations. To the extent that
Borrowers make a payment or payments to Administrative Agent or Lenders (or to
Administrative Agent for the benefit of Lenders), or Administrative Agent or
Lenders enforce any security interests or exercise their rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state or federal law, common
law or any equitable cause (whether by litigation, demand, settlement or
otherwise), then, to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied, and all Liens, rights and remedies therefor
or related thereto, shall be revived and continued in full force and effect as
if such payment or payments had not been made or such enforcement or setoff had
not occurred.
10.12 SEVERABILITY.
In case any provision in or obligation under this Agreement or the
Notes shall be invalid, illegal or unenforceable in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
10.13 OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS.
The obligations of Lenders hereunder are several and no Lender shall be
responsible for the obligations or Commitments of any other Lender hereunder.
Nothing contained herein or in any other Loan Document, and no action taken by
Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders, or
Lenders and Borrowers, as a partnership, an association, a joint venture or any
other kind of entity. The amounts payable at any time hereunder to each Lender
shall be a separate and independent debt, and each Lender shall be entitled to
protect and enforce its rights arising out of this Agreement and it shall not be
necessary for any other Lender to be joined as an additional party in any
proceeding for such purpose.
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10.14 HEADINGS.
Section and subsection headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose or be given any substantive effect.
10.15 APPLICABLE LAW.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES.
10.16 SUCCESSORS AND ASSIGNS.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and
permitted assigns, except that Borrowers may not assign or otherwise transfer
any of its rights or obligations hereunder without the prior written consent of
each Lender (and any attempted assignment or transfer by Borrowers without such
consent shall be null and void). Nothing in this Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby and, to the
extent expressly contemplated hereby, Affiliates of Administrative Agent and
Affiliates of Lenders) any legal or equitable right, remedy or claim under or by
reason of this Agreement.
10.17 CONSENT TO JURISDICTION AND SERVICE OF PROCESS.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWERS ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY OBLIGATIONS
THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTING AND
DELIVERING THIS AGREEMENT, BORROWERS, FOR THEMSELVES AND IN CONNECTION WITH
THEIR PROPERTIES, IRREVOCABLY
(I) ACCEPT GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE
JURISDICTION AND VENUE OF SUCH COURTS;
(II) WAIVE ANY DEFENSE OF FORUM NON CONVENIENS;
(III) AGREE THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN
ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, TO BORROWERS AT THEIR ADDRESSES PROVIDED IN
ACCORDANCE WITH SUBSECTION 10.8;
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CREDIT AGREEMENT
(IV) AGREE THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS
SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER BORROWER IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND
BINDING SERVICE IN EVERY RESPECT;
(V) AGREE THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST
BORROWERS IN THE COURTS OF ANY OTHER JURISDICTION; AND
(VI) AGREE THAT THE PROVISIONS OF THIS SUBSECTION 10.17 RELATING
TO JURISDICTION AND VENUE SHALL BE BINDING AND ENFORCEABLE TO THE
FULLEST EXTENT PERMISSIBLE UNDER NEW YORK GENERAL OBLIGATIONS LAW
SECTION 5-1402 OR OTHERWISE.
10.18 WAIVER OF JURY TRIAL.
EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO WAIVE ITS
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS
BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. The scope of this waiver
is intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
contract claims, tort claims, breach of duty claims and all other common law and
statutory claims. Each party hereto acknowledges that this waiver is a material
inducement to enter into a business relationship, that each has already relied
on this waiver in entering into this Agreement, and that each will continue to
rely on this waiver in their related future dealings. Each party hereto further
warrants and represents that it has reviewed this waiver with its legal counsel
and that it knowingly and voluntarily waives its jury trial rights following
consultation with legal counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SUBSECTION 10.18 AND EXECUTED BY EACH OF
THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS
MADE HEREUNDER. In the event of litigation, this Agreement may be filed as a
written consent to a trial by the court.
10.19 CONFIDENTIALITY.
Each Lender shall hold all non-public information obtained pursuant to
the requirements of this Agreement as confidential by Borrowers in accordance
with such
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CREDIT AGREEMENT
Lender's customary procedures for handling confidential information of this
nature and in accordance with safe and sound banking practices, it being
understood and agreed by Borrowers that in any event a Lender may make
disclosures (a) to its and its Affiliates' directors, officers, employees and
agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such information and instructed to keep such
information confidential), (b) to the extent requested by any government
authority, (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process, (d) to any other party to this Agreement,
(e) in connection with the exercise of any remedies hereunder or any suit,
action or proceeding relating to this Agreement or the enforcement of rights
hereunder, (f) subject to an agreement containing provisions substantially the
same as those of this subsection 10.19, to (i) any Eligible Assignee of or
participant in, or any prospective Eligible Assignee of or Participant in, any
of its rights or obligations under this Agreement or (ii) any direct or indirect
contractual counterparty or prospective counterparty (or such contractual
counterparty's or prospective counterparty's professional advisor) to any credit
derivative transaction relating to obligations of Borrowers, (g) with the
consent of Borrowers, (h) to the extent such information (i) becomes publicly
available other than as a result of a breach of this subsection 10.19, or (ii)
becomes available to Administrative Agent or any Lender on a nonconfidential
basis from a source other than Borrowers, or (i) to the National Association of
Insurance Commissioners or any other similar organization or any nationally
recognized rating agency that requires access to information about a Lender's or
its Affiliates' investment portfolio in connection with ratings issued with
respect to such Lender or its Affiliates; PROVIDED that, unless specifically
prohibited by applicable law or court order, each Lender shall notify Borrowers
of any request by any government authority or representative thereof (other than
any such request in connection with any examination of the financial condition
of such Lender by such government authority) for disclosure of any such
non-public information prior to disclosure of such information; and provided,
FURTHER, that in no event shall any Lender be obligated or required to return
any materials furnished by Borrowers or any of their Subsidiaries.
Notwithstanding anything contained herein to the contrary, Borrowers understand
and agree that Administrative Agent and each of the institutions identified as
"Co-Lead Arrangers," or "Syndication Agent" on the title page to this Agreement
may make customary disclosures for advertising and "league table" purposes.
10.20 CO-LEAD ARRANGERS, CO-DOCUMENTATION AGENTS AND SYNDICATION AGENT.
None of the institutions identified as "Lead Arranger," "Co-Lead
Arranger," "Co-Documentation Agent" or "Syndication Agent" on the title page to
this Agreement shall have any obligations, liabilities or duties under this
Agreement other than those applicable to a Lender (but only if such institution
is a Lender) as such, and no such institution shall have or be deemed to have
any fiduciary relationship with any Lender. Each Lender acknowledges that it has
not relied, and will not rely, on any such institution in deciding to enter into
this Agreement or in taking or not taking any action hereunder.
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CREDIT AGREEMENT
10.21 COUNTERPARTS; EFFECTIVENESS.
This Agreement and any amendments, waivers, consents or supplements
hereto or in connection herewith may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument; signature pages may
be detached from multiple separate counterparts and attached to a single
counterpart so that all signature pages are physically attached to the same
document. This Agreement shall become effective upon the execution of a
counterpart hereof by each of the parties hereto and receipt by Borrowers and
Administrative Agent of written or telephonic notification of such execution and
authorization of delivery thereof.
[Remainder of page intentionally left blank]
125
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWERS:
MEDITRUST CORPORATION
By: /s/ Francis W. Cash
-------------------------------------------
Name: Francis W. Cash
Title: President and Chief Executive Officer
Notice Address:
909 Hidden Ridge, Suite 600
Irvine, Texas 75038
Attention: General Counsel
with a copy to:
MEDITRUST OPERATING COMPANY
By: /s/ Francis W. Cash
-------------------------------------------
Name: Francis W. Cash
Title: President and Chief Executive Officer
Notice Address:
909 Hidden Ridge, Suite 600
Irvine, Texas 75038
Attention: General Counsel
ADMINISTRATIVE AGENT:
CANADIAN IMPERIAL BANK OF COMMERCE,
as Administrative Agent
By: /s/ Dean J. Decker
---------------------------------------------
Dean J. Decker
Managing Director
CIBC World Markets Corp., AS AGENT
Notice Address:
CANADIAN IMPERIAL BANK OF COMMERCE
425 Lexington Avenue
New York, New York 10017
Attn.: Agency Services Dept.
Facsimile No.: (212) 856-3799
With a Copy to:
CIBC WORLD MARKETS CORP.
350 South Grand Avenue, Suite 2600
Los Angeles, California 90071
SYNDICATION AGENT:
FLEET SECURITIES INC.,
as Syndication Agent
By: /s/ Michael P. Hannon
-----------------------------------------------
Michael P. Hannon, Managing Director
Notice Address:
Fleet Securities Inc.
Michael P. Hannon
Managing Director
100 Federal Street
Boston, MA 02110
Mail Stop: MA DE 100 11D
CO-LEAD ARRANGER:
CIBC WORLD MARKETS CORP.,
as Co-Lead Arranger
By: /s/ Dean J. Decker
--------------------------------------------
Dean J. Decker
Managing Director
Notice Address:
CIBC WORLD MARKETS CORP.
350 South Grand Avenue, Suite 2600
Los Angeles, California 90071
With a Copy to:
CANADIAN IMPERIAL BANK OF COMMERCE
425 Lexington Avenue
New York, New York 10017
Attn.: Agency Services Dept.
Facsimile No.: (212) 856-3799
CO-LEAD ARRANGER:
FLEET SECURITIES INC.,
as Co-Lead Arranger
By: /s/ Michael P. Hannon
---------------------------------------------
Michael P. Hannon, Managing Director
Notice Address:
Fleet Securities Inc.
Michael P. Hannon
Managing Director
100 Federal Street
Boston, MA 02110
Mail Stop: MA DE 100 11D
LENDERS:
CIBC, INC., as a Lender
By: /s/ Dean J. Decker
---------------------------------------------
Dean J. Decker
Managing Director
CIBC World Markets Corp., AS AGENT
Notice Address:
CIBC, INC.
425 Lexington Avenue
New York, New York 10017
Attn.: Agency Services Dept.
Facsimile No.: (212) 856-3799
With a Copy to:
CIBC WORLD MARKETS CORP.
350 South Grand Avenue, Suite 2600
Los Angeles, California 90071
FLEET NATIONAL BANK,
as a Lender
By: /s/ Cliff Mellor
---------------------------------------------
Cliff Mellor, Vice President
Notice Address:
Fleet National Bank
Cliff Mellor, Vice President
777 Main Street, CT EH 402 24E
Hartford, CT 0611
[other Lenders from time to time party hereto]