Exhibit 10.28
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CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT
Dated as of October 2, 2001
among
GENESIS HEALTH VENTURES, INC.
as Borrower
and
THE GUARANTORS REFERRED TO HEREIN
and
THE LENDERS REFERRED TO HEREIN
and
FIRST UNION SECURITIES, INC.
as Co-Lead Arranger
GOLDMAN SACHS CREDIT PARTNERS L.P.
as Co-Lead Arranger and Syndication Agent
FIRST UNION NATIONAL BANK
as Administrative Agent and Collateral Agent
GENERAL ELECTRIC CAPITAL CORPORATION
as Collateral Monitoring Agent and Co-Documentation Agent
and
CITICORP USA, INC.
as Co-Documentation Agent
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Schedules
1.2 Excluded Properties
1.3 Non-Core Assets
1.4 Specified Payments
3.1(a) List of jurisdictions where the Borrower is qualified/not in
good standing
3.1(b) List of jurisdictions where each Credit Party is qualified/not
in good standing
3.3(c) Governmental Approvals
3.7(a) Credit Parties and Subsidiaries Information
3.7(b) Beneficial Interests in Persons other than a Credit Party
3.7(c) Joint Venture and Partnership Interests
3.8 Proprietary Rights
3.9 Fictitious Names
3.10(a) Title to Properties
3.10(d) Rights of First Refusal/Option Rights
3.12(a) Litigation
3.12(c) Investigations/Medicare-Medicaid Claims
3.15 Taxes
3.17(b) Agreements
3.18(a) Filing Offices for UCC-1 Financing Statements
3.18(b) Filing Offices for the Mortgages and Fixture Filings
3.20 Environmental Matters
3.21(a) Pledged Securities
3.21(c) Restrictions on Transfer of the Pledged Securities
3.24(a) Owned Real Property Assets
3.24(b) Leased Real Property Assets
3.26 Labor Matters
3.28 Bank Accounts
4.1(b)(iv) List of Subsidiary Good Standing Certificates
4.1(c) Local Counsel Opinions
4.1(gg) Appraised Real Property Assets
6.1 Existing Indebtedness
6.2 Existing Liens
6.3 Certain Guaranties by Borrower
6.4 Existing Investments
8.3(b) Concentration Accounts
8.3(c) Government Concentration Accounts
ii
Exhibits
A Form of Assignment and Acceptance
B-1 Form of Borrowing Certificate
B-2 Form of Borrowing Base Certificate
C Form of Instrument of Assumption and Joinder
D Form of Mortgage
E Form of Note
F Form of Closing Certificate
G Form of Intercreditor and Collateral Agency Agreement
H Form of Contribution Agreement
iii
CREDIT, SECURITY, GUARANTY AND PLEDGE
AGREEMENT, dated as of October 2, 2001 (as
this agreement may be further amended,
amended and restated, supplemented or
otherwise modified, renewed or replaced from
time to time, the "Credit Agreement"), among
(i) Genesis Health Ventures, Inc., a
Pennsylvania corporation (the "Borrower");
(ii) the Guarantors referred to herein;
(iii) the Lenders referred to herein; (iv)
Goldman Sachs Credit Partners L.P., as
Co-Lead Arranger and Syndication Agent; (v)
First Union National Bank, as Administrative
Agent and Collateral Agent; (vi) First Union
Securities, Inc., as Co-Lead Arranger; (vii)
General Electric Capital Corporation, as
Collateral Monitoring Agent and
Co-Documentation Agent; and (viii) Citicorp
USA, Inc., as Co-Documentation Agent.
INTRODUCTORY STATEMENT
----------------------
All terms not otherwise defined above or in this Introductory
Statement are as defined in Article 1 hereof or as defined elsewhere herein.
Subject to and upon the terms and conditions set forth herein,
the Lenders are willing to make available to the Borrower: (a) Revolving Credit
Loans in the amount of $150,000,000, (b) the B Term Loans in the amount of
$285,000,000 and (c) Delayed Draw Term Loans in the amount of $80,000,000, and
other financial accommodations provided for in this Credit Agreement.
To provide assurance for the repayment of the Loans hereunder
and the other Obligations (as such term is hereinafter defined) of the Borrower
hereunder, the Borrower will, among other things, provide or cause to be
provided to the Collateral Agent, for the benefit of the Secured Parties, the
following (each as more fully described herein):
(i) a guaranty of the Obligations by each of the Guarantors pursuant to
Article 9 hereof;
(ii) a security interest in the Collateral from each of the Credit Parties
pursuant to Article 8 hereof;
(iii) a pledge by each of the Pledgors of the Pledged Collateral owned by it
pursuant to Article 10 hereof; and
(iv) a Mortgage with respect to certain Real Property Assets owned or leased
by the Credit Parties.
Subject to the terms and conditions set forth herein, the
Administrative Agent is willing to act as administrative agent for the Lenders,
the Collateral Agent is willing to act as collateral agent for the Lenders, the
Collateral Monitoring Agent is willing to act as collateral monitoring agent for
the Lenders, the Issuing Bank is willing to issue Letters of Credit as provided
herein, and each Lender is willing to make Loans and to participate in Letters
of Credit to the Borrower as provided herein, in an aggregate principal amount
at any one time outstanding not in excess of the Total Credit Commitments
hereunder.
Accordingly, the parties hereto hereby agree as follows:
1. DEFINITIONS
For the purposes hereof unless the context otherwise requires,
all references to Sections, Exhibits and Schedules shall be deemed references to
Sections of, and Exhibits and Schedules to, this Credit Agreement, the following
terms shall have the meanings indicated, all accounting terms not otherwise
defined herein shall have the respective meanings accorded to them under GAAP
and all terms defined in the UCC and not otherwise defined herein shall have the
respective meanings accorded to them therein. Whenever the context may require,
any pronoun shall include the masculine, feminine and neuter forms. Unless the
context otherwise requires, any of the following terms may be used in the
singular or the plural, depending on the reference:
"Adjusted LIBO Rate" shall mean with respect to any Eurodollar
Loan for any Interest Period, the rate per annum equal to the quotient (rounded
upwards, if necessary, to the next 1/100 of 1%) of (i) the LIBO Rate for such
Eurodollar Loan for such Interest Period divided by (ii) one minus the
applicable statutory reserve requirements of the Administrative Agent, expressed
as a decimal (including without duplication or limitation, basic, supplemental,
marginal and emergency reserves), from time to time in effect under Regulation D
or similar regulations of the Board. It is agreed that for purposes of this
definition, Eurodollar Loans made hereunder shall be deemed to constitute
Eurocurrency Liabilities as defined in Regulation D and to be subject to the
reserve requirements of Regulation D (for so long as such requirements are in
effect).
"Administrative Agent" shall mean First Union National Bank,
in its capacity as administrative agent for the Lenders hereunder or such
successor Administrative Agent as may be appointed pursuant to Section 12.12
hereof.
"Affiliate" shall mean with respect to any Person (including a
Credit Party), any other Person which, directly or indirectly, is in control of,
is controlled by, or is under common control with, such Person. For purposes of
this definition, a Person shall be deemed to be "controlled by" another Person
if such latter Person possesses, directly or indirectly, power either to (i)
vote fifteen percent (15%) or more of the securities or other ownership
interests having ordinary voting power for the election of directors (or the
equivalent) of such controlled Person or (ii) direct or cause the direction of
the management and policies of such controlled Person whether by contract or
otherwise.
"Affiliated Group" shall mean a group of Persons, each of
which is an Affiliate of some other Person in the group.
2
"AGE Claim" shall mean the claim of the Borrower and its
Subsidiaries against related nursing home owners affiliated with AGE Holdings,
Inc. for, among other things, unpaid receivables.
"Agents" shall mean collectively, the Administrative Agent,
the Collateral Agent and the Collateral Monitoring Agent.
"Applicable Interest Margin" shall mean:
(i) in the case of Base Rate Loans that are Term Loans, 2.50% per annum;
(ii) in the case of Eurodollar Loans that are Term Loans, 3.50% per annum;
(iii) from the Closing Date until the six month anniversary thereof, (A) in the
case of Base Rate Loans that are Revolving Credit Loans, 2.00% per annum and (B)
in the case of Eurodollar Loans that are Revolving Credit Loans, 3.00% per
annum; and
(iv) from and after the six month anniversary of the Closing Date, the
Applicable Interest Margin for Revolving Credit Loans shall be determined in
accordance with the following grid:
Eurodollar Loan
Base Rate Loan Applicable Interest
Total Leverage Ratio Applicable Interest Margin Margin
-------------------- -------------------------- -------------------
Greater than 3.25:1 2.25% 3.25%
Greater than 2.75:1, but 2.00% 3.00%
Less than or equal to 3.25:1
Greater than 2.25:1, but 1.75% 2.75%
Less than or equal to 2.75:1
Greater than 1.75:1, but 1.50% 2.50%
Less than or equal to 2.25:1
Less than or equal to 1.75:1 1.25% 2.25%
"Applicable Law" shall mean all applicable provisions of
statutes, rules, regulations and orders of the United States, any state thereof
or municipality therein or of any foreign governmental body or of any regulatory
agency applicable to the Person in question, and all orders and decrees of all
courts and arbitrators in proceedings or actions in which the Person in question
is a party.
"APS Acquisition" shall mean the acquisition from Mariner
Post-Acute Network, Inc., Mariner Health Group, Inc. and certain of their
Affiliates of the assets of such entities' pharmacy businesses and certain
assets related thereto pursuant to that certain Purchase Agreement, dated as of
September 24, 2001, together with any amendments thereto, which if material, are
in form and substance satisfactory to the Administrative Agent and the Co-Lead
Arrangers.
3
"Assignment and Acceptance" shall mean an agreement
substantially in the form of Exhibit A hereto, executed by the assignor, the
assignee and the other parties as contemplated hereby or thereby.
"Authorized Officer" shall mean, with respect to the Borrower
or any other Credit Party, the president, vice president, chief financial
officer, chief accounting officer, secretary, treasurer or the general partner
or managing member of such entity (or of the general partner or managing member
of such entity, if not a natural person), as the case may be.
"B Term Loan" shall have the meaning given to such term in
Section 2.1 hereof.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of
1978, as heretofore and hereafter amended, as codified at 11 U.S.C. ss. 101 et
seq.
"Bankruptcy Court" shall mean the United States Bankruptcy
Court for the District of Delaware.
"Base Rate" shall mean, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Rate in effect for such day plus 1/2 of 1%. For purposes hereof, "Prime
Rate" shall mean the rate of interest per annum established from time to time by
the Administrative Agent as its prime rate, which rate may not be the lowest
rate of interest charged by the Administrative Agent to its customers. "Federal
Funds Rate" shall mean, for any day, the rate per annum (rounded upwards, if
necessary, to the next 1/100th of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, on such day, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York; provided, that
(i) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day and (ii) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to the Administrative Agent on such day on
such transactions as determined by the Administrative Agent. If the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Rate for any reason, including (without limitation) the inability or
failure of the Administrative Agent to obtain quotations in accordance with the
terms hereof, the Base Rate shall be determined without regard to clause (b) of
the first sentence of this definition until the circumstances giving rise to
such inability no longer exist. Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Loan" shall mean a Loan based on the Base Rate in
accordance with the provisions of Article 2 hereof.
4
"Board" shall mean the Board of Governors of the Federal
Reserve System of the United States of America.
"Borrower" shall have the meaning given to such term in the
initial paragraph of this Credit Agreement.
"Borrowing" shall mean a Loan or group of Loans of the same
Tranche and Interest Rate Type, made, converted or continued on the same date
and, in the case of Eurodollar Loans, as to which a single Interest Period is in
effect.
"Borrowing Base" shall mean as of any date of determination
thereof an amount equal to the sum of (i) eighty-five percent (85%) of the net
amount of Eligible Receivables plus (ii) fifty percent (50%) of the Net Value of
Eligible Real Estate. The Borrowing Base shall be computed as of the end of each
fiscal month; provided, that so long as no Event of Default has occurred and is
continuing under Section 7(e) (with respect to Section 5.1(k)), the Borrowing
Base in effect at any time shall be determined by reference to the most recent
Borrowing Base Certificate delivered in accordance with Section 5.1(k), absent
any error in such Borrowing Base Certificate. For purposes hereof, "the net
amount of Eligible Receivables" at any time shall be the face amount (or portion
of the face amount thereof in the case of Receivables referred to in clause
(vii) of the definition of Eligible Receivable) of such Eligible Receivables
less (without duplication to the extent deducted under the definition of
Receivable) any and all rebates, discounts, credits, allowances, sales or excise
taxes of any nature at any time issued, owing, claimed, granted, outstanding or
payable in connection with such Receivables at such time.
"Borrowing Base Certificate" shall mean a certificate,
substantially in the form of Exhibit B-2 hereto, appropriately completed by an
Authorized Officer of the Borrower with respect to the Borrowing Base.
"Borrowing Certificate" shall mean a borrowing certificate,
substantially in the form of Exhibit B-1 hereto, to be delivered by the Borrower
to the Administrative Agent in connection with each Borrowing.
"Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banks are required or permitted to close in the
States of New York or North Carolina; provided, however, that when used in
connection with a Eurodollar Loan, the term "Business Day" shall also exclude
any day on which banks are not open for dealings in Dollar deposits on the
London Interbank Market.
"Capital Expenditures" shall mean, with respect to any Person
for any period, the aggregate of all expenditures (whether paid in cash or
accrued as a liability) by such Person during that period which, in accordance
with GAAP, are or should be included in "additions to property, plant or
equipment" or similar items reflected in the statement of cash flows of such
Person (other than expenditures incurred in connection with the APS Acquisition
or any other acquisition permitted under Section 6.7 hereof).
5
"Capital Lease", as applied to any Person, shall mean any
lease of any property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a capital lease
on the balance sheet of that Person.
"Capital Stock" shall mean (i) with respect to corporate
stock, any and all shares, interests, rights to purchase, warrants, options,
participations or other equivalents of or interests in (however designated)
corporate stock, including without limitation, any Preferred Stock or (ii) with
respect to any other evidence of beneficial ownership of any entity which is not
a corporation, any and all partnership interests or any other equity interests
or evidences of beneficial ownership, rights to purchase, warrants, options,
participations or other equivalents of or interests in (however designated) a
partnership interest or other equity interest or evidence of beneficial
ownership.
"Cardinal" shall mean Cardinal Health, Inc., an Ohio
corporation, and its subsidiaries.
"Cardinal Lien" shall mean a security interest in certain
inventory in favor of Cardinal securing trade payables of up to $50,000,000
pursuant to that certain Prime Vendor Agreement between certain Credit Parties
and Cardinal Distribution dated as of May 5, 1999, as amended, and that certain
Prime Vendor Agreement between certain Credit Parties and Cardinal Distribution
dated as of September 28, 2001.
"Cash Collateral Account" shall have the meaning given to such
term in Section 11.1 hereof.
"Cash Equivalents" shall mean any of the following: (i) full
faith and credit obligations of the United States of America, or fully
guaranteed as to interest and principal by the full faith and credit of the
United States of America, maturing in not more than one year from the date such
investment is made; (ii) time deposits and certificates of deposit having a
final maturity of not more than one year after the date of issuance thereof of
any commercial bank incorporated under the laws of the United States of America
or any state thereof or the District of Columbia, which bank is a member of the
Federal Reserve System and has a combined capital and surplus of not less than
$1,000,000,000.00 and with a senior unsecured debt credit rating of at least "A"
by Moody's or "A" by S&P; (iii) commercial paper of companies, banks, trust
companies or national banking associations incorporated or doing business under
the laws of the United States of America or one of the States thereof, in each
case having a remaining term until maturity of not more than one hundred eighty
(180) days from the date such investment is made and rated at least P-1 by
Moody's or at least A-1 by S&P; (iv) repurchase agreements with any financial
institution having combined capital and surplus of not less than
$1,000,000,000.00 with a term of not more than seven (7) days for underlying
securities of the type referred to in clause (i) above; and (v) money market
funds which invest primarily in the Cash Equivalents set forth in the preceding
clauses (i) - (iv).
"CHAMPUS" shall mean, collectively, the Civilian Health and
Medical Program of the Uniformed Service, a program of medical benefits covering
former and active members of the uniformed services and certain of their
dependents, financed and administered by the United States Departments of
Defense, Health and Human Services and Transportation, and all laws, rules,
regulations, manuals, orders, guidelines or requirements pertaining to such
program including (a) all federal statutes (whether set forth in 10 U.S.C.
ss.ss.1071-1106 or elsewhere) affecting such program; and (b) all rules,
regulations (including 32 C.F.R. ss.199), manuals, orders and administrative,
reimbursement and other guidelines of all Governmental Authorities promulgated
in connection with such program (whether or not having the force of law), in
each case as the same may be amended, supplemented or otherwise modified from
time to time.
6
"CHAMPUS Receivable" shall mean a Receivable payable to a
Credit Party pursuant to CHAMPUS.
"CHAMPVA" shall mean, collectively, the Civilian Health and
Medical Program of the Department of Veteran Affairs, a program of medical
benefits covering retirees and dependents of former members of the armed
services administered by the United States Department of Veteran Affairs, and
all laws, rules, regulations, manuals, orders, guidelines or requirements
pertaining to such program including (a) all federal statutes (whether set forth
in 38 U.S.C. ss.1713 or elsewhere) affecting such program or, to the extent
applicable to CHAMPVA; and (b) all rules, regulations (including 38 C.F.R.
ss.17.54), manuals, orders and administrative, reimbursement and other
guidelines of all Governmental Authorities promulgated in connection with such
program (whether or not having the force of law), in each case as the same may
be amended, supplemented or otherwise modified from time to time.
"CHAMPVA Receivable" shall mean a Receivable payable to a
Credit Party pursuant to CHAMPVA.
"Change in Control" shall mean (i) any Person, Affiliated
Group or group (such term being used as defined in the Securities Exchange Act
of 1934, as amended), acquiring ownership or control of in excess of 35% of
equity securities having voting power to vote in the election of the Board of
Directors of the Borrower either on a fully diluted basis or based solely on the
voting stock then outstanding, (ii) if at any time, individuals who at the date
hereof constituted the Board of Directors of the Borrower (together with any new
directors whose election by such Board of Directors or whose nomination for
election by the shareholders of the Borrower, as the case may be, was approved
by a vote of the majority of the directors then still in office who were either
directors at the date hereof or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board of Directors of the Borrower then in office, (iii) the direct or indirect
sale, transfer, conveyance or other disposition (other than by way of merger or
consolidation), in one or a series of related transactions, of all or
substantially all of the properties or assets of the Borrower to any Person or
(iv) the adoption of a plan relating to the liquidation or dissolution of the
Borrower.
"Closing Date" shall mean the date on which the conditions
precedent set forth in Section 4.1 hereof have been satisfied or waived.
"CMS" shall mean The Center for Medicare and Medicaid
Services, formerly known as the Health Care Financing Administration, the entity
within the United States Department of Health and Human Services responsible for
administering the Medicare program and the federal aspects of the Medicaid
programs, directly and through its fiscal intermediaries and agents.
7
"Co-Lead Arrangers" shall mean First Union Securities, Inc.
and Goldman Sachs Credit Partners L.P. in their capacities as co-lead arrangers.
"Code" shall mean the Internal Revenue Code of 1986, as
heretofore and hereafter amended, as codified at 26 U.S.C. ss. 1 et seq., and
the applicable regulations promulgated thereunder, or any successor provision
thereto.
"Collateral" shall mean with respect to each Credit Party, all
of such Credit Party's right, title and interest in and to (i) all personal
property, tangible and intangible, wherever located or situated and whether now
owned, presently existing or hereafter acquired or created, including but not
limited to, all goods, accounts, health-care insurance receivables, instruments,
intercompany obligations, contract rights, partnership and joint venture
interests, interests in limited liability companies, documents, chattel paper,
electronic chattel paper, general intangibles, goodwill, equipment, machinery,
inventory, investment property, copyrights, trademarks, trade names, patents,
insurance proceeds, cash, deposit accounts, letter of credit rights, supporting
obligations, fixtures, Non-Government Receivables, Rights to Government
Receivables and the Pledged Securities, and any proceeds or products of, income
from, any of the foregoing, in any form, including, without limitation, any
claims against third parties for loss or damage to or destruction of any or all
of the foregoing, excluding any personal property located in or appurtenant to
the Excluded Properties or any Non-Core Assets (other than Receivables or other
intangibles related to such Excluded Properties or Non-Core Assets so long as
the grant of a security interest in such Receivables or other intangibles is not
prohibited or restricted by Applicable Law or any contract or agreement); (ii)
all books, records, ledger cards, computer tapes and diskettes wherever located,
related to the Collateral described in clause (i) or (iii) of this definition or
any of the Real Property Assets; and (iii) the Pledged Collateral.
"Collateral Agent" shall mean First Union National Bank in its
capacity as collateral agent for the Lenders hereunder or such successor
Collateral Agent as may be appointed pursuant to Section 12.12 hereof.
"Collateral Monitoring Agent" shall mean General Electric
Capital Corporation in its capacity as collateral monitoring agent for the
Lenders hereunder or such successor Collateral Monitoring Agent as may be
appointed pursuant to Section 12.12 hereof.
"Commitment" shall mean any of the commitments of a Lender to
make Loans, i.e., whether the Term Loan B Commitment, the Delayed Draw Term Loan
Commitment or the Revolving Credit Commitment.
"Commitment Fees" shall mean collectively, the Revolving
Credit Commitment Fee and the Delayed Draw Term Loan Commitment Fee.
"Concentration Accounts" shall mean the concentration accounts
established by the Credit Parties for deposit of all collections on Receivables
other than Medicare Receivables as set forth on Schedule 8.3(b) hereto.
"Consolidated EBITDA" shall mean, for any period, all as
determined in accordance with GAAP, the Consolidated Net Income (or net loss) of
the Borrower and its Consolidated Subsidiaries for such period, plus (a) the sum
for such period for Borrower and its Consolidated Subsidiaries determined on a
consolidated basis of (i) depreciation expense, (ii) amortization expense, (iii)
other non-cash expenses, (iv) provision for LIFO adjustment for inventory
valuation, (v) net total Federal, state and local income tax expenses, (vi)
Consolidated Interest Expense, (vii) extraordinary losses, (viii) any
non-recurring charge or restructuring charge, and (ix) the cumulative effect of
any change in accounting principles less (b) extraordinary gains for such period
for Borrower and its Consolidated Subsidiaries determined on a consolidated
basis to the extent included in the definition of Consolidated Net Income.
8
"Consolidated EBITDAR" shall mean, for any period,
Consolidated EBITDA for such period plus Consolidated Rental Expense for such
period.
"Consolidated Fixed Charge Coverage Ratio" shall mean, at any
date for which such ratio is to be determined, the ratio of Consolidated EBITDAR
for the Rolling Four Quarter period ended on such date to the sum of the
following for such period: (i) Consolidated Interest Expense plus (ii)
Consolidated Rental Expense plus (iii) scheduled principal payments on all
Indebtedness of the Borrower and its Consolidated Subsidiaries, including,
without limitation, any Indebtedness under any B Term Loans, Delayed Draw Term
Loans, the Rollover Notes and any Mortgage Loans.
"Consolidated Interest Expense" shall mean, for any period,
the gross interest expense, whether paid or accrued (including the interest
component of Capital Lease obligations) of the Borrower and its Consolidated
Subsidiaries on a consolidated basis for such period, including, without
limitation or duplication, (i) interest expense in respect of the Loans and all
other outstanding Indebtedness, (ii) amortization of the discount or issuance
cost of any Indebtedness (including, without limitation, any original issue
discount attributable to any issuance of debt securities), (iii) commissions,
discounts and other fees and charges payable in connection with letters of
credit, (iv) net payments payable in connection with all Interest Rate
Protection Agreements (including amortization of any discount) and (v) any
interest which is capitalized, all as determined in conformity with GAAP.
"Consolidated Net Income" shall mean, for any period for which
such amount is being determined, the net income or loss of the Borrower and its
Consolidated Subsidiaries during such period determined on a consolidated basis
for such period taken as a single accounting period in accordance with GAAP;
provided, that (i) there shall be excluded (x) the income (or loss) of any
Person (other than a Consolidated Subsidiary) in which the Borrower or any of
its Consolidated Subsidiaries has an equity investment or comparable interest,
except to the extent of the amount of dividends or other distributions actually
paid to the Borrower or any of its Consolidated Subsidiaries by such Person
during such period and (y) the income of any Consolidated Subsidiary to the
extent that the declaration or payment of dividends or similar distributions by
that Consolidated Subsidiary of its 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
Consolidated Subsidiary; and (ii) there shall be included or excluded (as
applicable) on a Pro Forma Basis the income (or loss) of any Person which
becomes a Consolidated Subsidiary of the Borrower, is merged into or
consolidated with the Borrower or any of its Consolidated Subsidiaries or assets
are acquired or sold or otherwise disposed of by the Borrower or any of its
Consolidated Subsidiaries during such period.
9
"Consolidated Net Working Assets" shall mean for any date for
which it is to be determined, (i) the total assets of the Borrower and its
Consolidated Subsidiaries which may properly be classified as current assets in
accordance with GAAP (excluding cash and Cash Equivalents), minus (ii) the total
liabilities of the Borrower and its Consolidated Subsidiaries which may properly
be classified as current liabilities in accordance with GAAP (excluding current
maturities of all long term Indebtedness), determined on a consolidated basis in
accordance with GAAP.
"Consolidated Rental Expense" shall mean, for any period, the
aggregate rental obligations of the Borrower and its Consolidated Subsidiaries
on a consolidated basis for such period payable in respect of any leases (other
than Capital Leases) including, without limitation, obligations for taxes,
insurance, maintenance and similar costs which the lessee is obligated to pay
under the terms of such leases and which are attributable to the leases for such
period (whether such amounts are accrued or paid during such period).
"Consolidated Subsidiaries" shall mean all Subsidiaries of a
Person which are required or permitted to be consolidated with such Person for
financial reporting purposes in accordance with GAAP.
"Consolidated Net Worth" shall mean at any date of
determination, the sum of the capital stock and additional paid-in capital plus
retained earnings (or minus accumulated deficit) of the Borrower and its
Consolidated Subsidiaries on a consolidated after-tax basis determined in
accordance with GAAP.
"Contribution Agreement" shall mean a contribution agreement
among the Credit Parties, substantially in the form of Exhibit H hereto, as such
agreement may be amended, amended and restated, supplemented or otherwise
modified, renewed or replaced from time to time.
"Credit Agreement" shall have the meaning given to such term
in the initial paragraph of this agreement.
"Credit and Collection Policy" shall mean those credit and
collection policies and practices relating to Receivables in existence on the
date hereof and as modified in compliance with Section 6.20.
"Credit Exposure" shall mean, with respect to any Lender, an
amount equal to (i) the aggregate principal amount of outstanding Loans owed to
such Lender hereunder, plus (ii) such Lender's pro rata share of any L/C
Exposure (if applicable), plus (iii) the unused amount of the Revolving Credit
Commitment and the Delayed Draw Term Loan Commitment, as applicable, of such
Lender then in effect.
"Credit Party" shall mean the Borrower and each of the
Guarantors.
10
"Debtor Relief Laws" shall mean the Bankruptcy Code and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief laws of the United States of America or other
applicable jurisdictions from time to time in effect affecting the rights of
creditors generally.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean, at any time, any Lender which
shall not have theretofore made available to the Administrative Agent or the
Issuing Bank, as applicable, any amounts required to be made available by such
Lender hereunder or otherwise failed to pay any obligation owing by such Lender
pursuant to this Credit Agreement.
"Delayed Draw Term Loan" shall have the meaning given to such
term in Section 2.3 hereof.
"Delayed Draw Term Loan Availability Period" shall mean the
period commencing on the Closing Date and ending on the Delayed Draw Term Loan
Commitment Termination Date.
"Delayed Draw Term Loan Commitment" shall mean the Commitment
of each Lender to make Delayed Draw Term Loans to the Borrower up to an
aggregate principal amount, at any one time, not in excess of the amount set
forth (i) under such Lender's name opposite the row entitled "Delayed Draw Term
Loan Commitment" on the signature pages hereto or (ii) in any applicable
Assignment and Acceptance(s) to which it is a party, as the case may be, as such
amount may be reduced from time to time in accordance with the terms of this
Credit Agreement.
"Delayed Draw Term Loan Commitment Fee" shall have the meaning
given to such term in Section 2.8(b) hereof.
"Delayed Draw Term Loan Commitment Termination Date" shall
mean the earliest to occur of (i) the first anniversary of the Closing Date,
(ii) the date on which the fifth draw is made under the Delayed Draw Term Loan
Commitment, (iii) the date on which the full amount of the Delayed Draw Term
Loan Commitment has been borrowed and (iv) the date on which the Delayed Draw
Term Loan Commitment shall terminate in accordance with Section 2.9 or Article 7
hereof.
"Delayed Draw Term Loan Lender" shall mean any Lender holding
a Delayed Draw Term Loan Commitment hereunder.
"DIP Facility" shall mean collectively, each of the following
debtor-in-possession financing agreements: (i) the Revolving Credit and Guaranty
Agreement, dated as of June 22, 2000, among Genesis Health Ventures, Inc.,
debtor and debtor-in-possession, as borrower, the subsidiaries of the borrower
named therein, each a debtor and debtor-in-possession, as guarantors, the banks
named therein, Mellon Bank, N.A., as administrative agent and arranger, First
Union National Bank, as syndication agent, Goldman Sachs Credit Partners, L.P.,
as documentation agent, and JP Morgan Chase (formerly The Chase Manhattan Bank),
as co-agent, and (ii) the Revolving Credit and Guaranty Agreement, dated as of
June 22, 2000, among The Multicare Companies, Inc., debtor and
debtor-in-possession, as borrower, the subsidiaries of the borrower named
therein, each a debtor and debtor-in-possession, as guarantors, the banks named
therein, Mellon Bank, N.A., as administrative agent and arranger, First Union
National Bank, as syndication agent, Goldman Sachs Credit Partners, L.P., as
documentation agent, and JP Morgan Chase (formerly The Chase Manhattan Bank), as
co-agent.
11
"Dollars" and "$" shall mean lawful money of the United States
of America.
"ElderTrust" shall mean ElderTrust, a Maryland real estate
investment trust.
"Eligible Assignee" shall mean (i) any Lender, any Affiliate
of any Lender (which, for purposes of this definition, shall include any
investment or similar fund that is owned, managed or controlled by such Lender)
and any Related Fund (any two or more Related Funds being treated as a single
Eligible Assignee for all purposes hereof), and (ii) any commercial bank,
insurance company, investment or mutual fund or other entity that is an
"accredited investor" (as defined in Regulation D under the Securities Act) and
which extends credit, buys loans and is in the business of lending as one of its
businesses; provided, that no Affiliate of the Borrower (other than Goldman
Sachs Credit Partners L.P. and its Affiliates) shall be an Eligible Assignee.
"Eligible Receivable" shall mean a Receivable which the
Collateral Agent and the Collateral Monitoring Agent, in their reasonable
discretion based upon customary credit considerations of the Collateral Agent
and Collateral Monitoring Agent deem to be an Eligible Receivable. Without
limiting the generality of the foregoing, no Receivable (or portion thereof in
the case of clause (vii) below) of a Credit Party is to be an Eligible
Receivable if: (i) it arises out of a sale made by such Credit Party to any
director, officer, employee or Subsidiary; (ii) it is unpaid more than one
hundred twenty (120) days after the original invoice due date; (iii) it is a
Receivable that has been prebilled for future services; (iv) any covenant,
representation or warranty contained in this Agreement with respect to such
Receivable has been breached; (v) the account debtor is also such Credit Party's
creditor or supplier, or has commenced a litigation disputing liability with
respect to such Receivable, or the Receivable otherwise is subject to any right
of setoff by the account debtor, to the extent of the amount of any offset,
dispute or claim; (vi) the account debtor has voluntarily or involuntarily
become subject to any Debtor Relief Laws except for Receivables on which the
account debtor is Mariner Post-Acute Network, Inc. and the invoice date for the
Receivable is less than thirty (30) days before the date on which chargeability
is being determined; (vii) it is payable by an account debtor who has applied
for Medicaid but for whom Medicaid has not been approved; provided that only
fifteen percent (15%) of the face amount of each such Receivable shall not be
deemed an Eligible Receivable; (viii) it arises from a transaction with an
account debtor outside the United States; (ix) the Collateral Agent and the
Collateral Monitoring Agent, in their reasonable discretion based upon customary
credit considerations of the Collateral Agent and the Collateral Monitoring
Agent, believe that collection of such Receivable is doubtful or will be delayed
by reason of the account debtor's financial condition; (x) except in the case of
a Government Receivable, it is the obligation of an account debtor that is the
United States government or a political subdivision thereof, or any state,
county or municipality or department, agency or instrumentality thereof; (xi)
the account debtor is located in any state in which such Credit Party is deemed
to be doing business under the laws of such state and which denies creditors
access to its courts in the absence of qualification to transact business in
such state or of the filing of any reports with such state, unless such Credit
Party has qualified as a foreign corporation authorized to transact business in
such state or has filed all required reports; (xii) except in the case of
Government Receivables, the Collateral Agent does not have a duly perfected
first priority security interest therein or the Receivable is otherwise subject
to any Lien, other than a Permitted Lien; (xiii) the Receivable is evidenced by
chattel paper or an instrument, or has been reduced to judgment; (xiv) such
Credit Party has made any agreement with the account debtor for any deduction
therefrom, except for discounts or allowances which are made in the ordinary
course of business for prompt payment and which discounts or allowances are
reflected in the calculation of the face value of each invoice related to such
Receivable; (xv) the Receivable is due from a credit card clearing house; (xvi)
except in the case of Government Receivables, such Credit Party's right to
receive payment under the Receivable is not absolute or is contingent upon the
fulfillment of any condition whatsoever; (xvii) such Credit Party is not able to
bring suit or otherwise enforce its remedies against the account debtor through
judicial process; (xviii) the Receivable represents a progress billing
consisting of an invoice for goods sold or used or services rendered pursuant to
a contract under which the account debtor's obligation to pay that invoice is
subject to such Credit Party's completion of further performance under such
contract; or (xix) the Receivable or any portion thereof is a private pay
patient account representing amounts not covered by third party payors to the
extent not so covered. In determining which accounts are Eligible Receivables,
the Collateral Agent and the Collateral Monitoring Agent may rely on all
statements and representations made by any Credit Party with respect to any
Receivable or Receivables.
12
"Environment" shall mean any surface or subsurface water,
groundwater, water vapor, surface or subsurface land, air, fish, wildlife,
microorganisms and all other natural resources.
"Environmental Claim" shall mean any and all administrative or
judicial actions, suits, orders, claims, liens, notices, notices of violations,
investigations, complaints, requests for information, proceedings, or other
written communication, whether criminal or civil, pursuant to or relating to any
applicable Environmental Law by any Person (including, but not limited to, any
Governmental Authority, private person and citizens' group) based upon,
alleging, asserting, or claiming any actual or potential (i) violation of or
liability under any Environmental Law, (ii) violation of any Environmental
Permit, or (iii) liability for investigatory costs, cleanup costs, removal
costs, remedial costs, response costs, natural resource damages, damage,
property damage, personal injury, fines, or penalties arising out of, based on,
resulting from, or related to the presence, Release, or threatened Release into
the Environment, of any Hazardous Materials at any location, including, but not
limited to, any Premises or any location other than any Premises to which
Hazardous Materials or materials containing Hazardous Materials were sent for
handling, storage, treatment, or disposal.
13
"Environmental Clean-up Site" shall mean any location which is
listed or proposed for listing on the National Priorities List, the
Comprehensive Environmental Response, Compensation and Liability Information
System, or on any similar state list of sites requiring investigation or
cleanup, or which is the subject of any pending action, suit, proceeding, or
investigation related to or arising from any alleged violation of any
Environmental Law, or at which there has been a Release, or a threatened or
suspected Release of a Hazardous Material.
"Environmental Laws" shall mean any and all applicable
federal, state, local or municipal or foreign laws, rules, orders, regulations,
statutes, ordinances, codes, common law doctrines, decrees or requirements of
any Governmental Authority regulating, relating to, or imposing liability or
standards of conduct concerning, any Hazardous Material or environmental
protection or worker health and safety, as now or at any time hereafter in
effect, including without limitation, the Clean Water Act also known as the
Federal Water Pollution Control Act ("FWPCA"), 33 U.S.C.ss.1251 et seq., the
Clean Air Act ("CAA"), 42 U.S.C.ss.ss.7401 et seq.,
the Federal Insecticide, Fungicide and Rodenticide Act ("FIFRA"), 7
U.S.C.ss.ss. 136 et seq., the Surface Mining Control and Reclamation Act
("SMCRA"), 30 U.S.C.ss.ss.1201 et seq., the Comprehensive Environmental
Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.ss.9601 et seq.,
the Superfund Amendment and Reauthorization Act of 1986 ("SARA"), Public Law
99-499, 100 Stat. 1613, the Emergency Planning and Community Right to Know Act
("ECPCRKA"), 42 U.S.C.ss.11001 et seq., the Resource Conservation and Recovery
Act ("RCRA"), 42 U.S.C.ss.6901 et seq., the Occupational Safety and Health Act
as amended ("OSHA"), 29 U.S.C.ss.655 andss.657, together, in each case, with any
amendment thereto, and the regulations adopted and the publications promulgated
thereunder and all substitutions thereof.
"Environmental Permit" shall mean any federal, state, local,
provincial, or foreign permits, licenses, approvals, consents or authorizations
required by any Governmental Authority under or in connection with any
Environmental Law and includes any and all orders, consent orders or binding
agreements issued or entered into by a Governmental Authority under any
applicable Environmental Law.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as heretofore and hereafter amended, as codified at 29 U.S.C. ss. 1001
et seq., and applicable regulations promulgated thereunder, or any successor
provision thereto.
"ERISA Affiliate" shall mean each Person (as defined in
Section 3(9) of ERISA) which is treated as a single employer with any Credit
Party under Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Loan" shall mean a Loan based on the LIBO Rate in
accordance with the provisions of Article 2 hereof.
"Event of Default" shall have the meaning given to such term
in Article 7 hereof.
"Excess Cash Flow" shall mean for any period for which it is
to be determined, the sum of (i) Consolidated Net Income, (ii) to the extent
Consolidated Net Income has been reduced thereby, amortization expense,
depreciation expense, and other non-cash expenses and (iii) the negative change,
if any, in Consolidated Net Working Assets during such period minus the sum of
(w) non-cash items increasing Consolidated Net Income, (x) principal repayments
by the Borrower or any of its Consolidated Subsidiaries on their Indebtedness,
including principal repayments on the Loans and the principal portion of
payments under Capital Leases (but exclusive of mandatory payments during the
period based upon the amount of Excess Cash Flow during prior periods, payments
made from the proceeds of any asset sales, insurance proceeds, new equity
securities issued by the Borrower or Indebtedness incurred by the Borrower or
any of its Consolidated Subsidiaries and any payments that can be reborrowed),
(y) the net positive change, if any, in Consolidated Net Working Assets during
such period, and (z) Capital Expenditures permitted hereunder, to the extent
paid in cash from sources other than secured purchase money financing, all as
determined for such period in conformity with GAAP and without any
double-counting.
14
"Excluded Properties" shall mean those properties listed on
Schedule 1.2 hereto.
"Facility Purchase Options" shall mean the purchase options
held by the Borrower or its Subsidiaries permitting it to purchase the
properties known as the Ansted Health Care Center, the Hilltop Nursing Center,
and Knollwood Manor.
"Facility Termination Date" shall mean the date on which all
of the Obligations have been indefeasibly paid in full in cash, the Total
Revolving Credit Commitment, the Total Term Loan B Commitment and the Total
Delayed Draw Term Loan Commitment have been permanently terminated in their
entirety and all Letters of Credit shall have expired or been terminated,
canceled or cash collateralized in an amount equal to 105% of the then current
L/C Exposure.
"Federal Funds Rate" shall have the meaning given to such term
in the definition of "Base Rate" set forth in this Article 1.
"Fee Letters" shall mean those certain letter agreements, one
dated as of July 13, 2001, between the Borrower and the Administrative Agent,
two dated as of July 13, 2001, between the Borrower and the Co-Lead Arrangers
and one dated as of August 6, 2001 between the Borrower and the Collateral
Monitoring Agent, relating to the payment of certain fees, as any of such letter
agreements may be amended, modified or supplemented from time to time by a
written instrument executed by the parties thereto.
"Fees" shall mean all fees payable pursuant to the Fee Letters
and pursuant to the terms of this Credit Agreement.
"Final Order" shall mean an order of the Bankruptcy Court not
subject to a stay pending appeal.
"Fundamental Documents" shall mean this Credit Agreement, any
note issued to evidence any Loan hereunder, any Letter of Credit, any Mortgage,
the Contribution Agreement, UCC financing statements, the Fee Letters and any
other documentation which is required to be or is otherwise executed by any
Credit Party and delivered in connection with this Credit Agreement or any of
the documents listed above.
15
"GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect from time to time, consistently
applied (except for accounting changes in response to FASB releases, or other
authoritative pronouncements); provided, however, that for purposes of
determining compliance with any covenant set forth in Article 6 hereof, GAAP
shall mean generally accepted accounting principles in the United States of
America as in effect on the Closing Date, applied on a basis consistent with the
application used in the financial statements referred to in Section 3.6 hereof.
"Genesis Medicare Claim" shall mean the claim filed by the
Borrower against the federal government with respect to disputed Medicare
Receivables where the dispute is related to "related party issues" or "employee
benefits costs".
"Governmental Authority" shall mean any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, or any court, in each case whether of the United States or any
foreign jurisdiction.
"Government Receivables" shall mean, collectively, any and all
Receivables which are (a) Medicare Receivables, (b) Medicaid Receivables, (c)
TRICARE Receivables, (d) CHAMPVA Receivables, (e) CHAMPUS Receivables; or (f)
any other Receivables payable by a Governmental Authority and approved by the
Collateral Agent and the Collateral Monitoring Agent in their sole discretion.
"Guarantors" shall mean the guarantors signatory hereto as of
the date hereof and any other direct or indirect Subsidiary of a Credit Party
acquired or created after the date hereof, which Subsidiary becomes a signatory
to this Credit Agreement as a Guarantor as required by Section 5.12 hereof.
"Guaranty" shall mean, as to any Person, any direct or
indirect obligation of such Person guaranteeing or intending to guarantee, or
otherwise providing credit support, for any Indebtedness, Capital Lease,
dividend or other monetary obligation ("primary obligation") of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, by
contract, as a general partner or otherwise, including, without limitation, any
obligation of such Person, whether or not contingent, (a) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any
such primary obligation or (ii) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, or (c) to purchase property, securities or services from the
primary obligor or other Person, in each case, primarily for the purpose of
assuring the performance of the primary obligor of any such primary obligation
or assuring the owner of any such primary obligation of the repayment of such
primary obligation. The amount of any Guaranty shall be deemed to be an amount
equal to (x) the stated or determinable amount of the primary obligation in
respect of which such Guaranty is made (or, if the amount of such primary
obligation is not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder)) or (y) the stated maximum liability under such Guaranty, whichever
is less.
16
"Hazardous Materials" shall mean any chemicals, materials,
substances or wastes in any amount or concentration which are now or hereafter
become defined as or included in the definition of "hazardous substances,"
"hazardous materials," "hazardous wastes," "extremely hazardous wastes,"
"restricted hazardous wastes," "toxic substances," "toxic pollutants,"
"pollutants," "regulated substances," "solid wastes," or "contaminants" or words
of similar import, under any Environmental Law, including petroleum, petroleum
hydrocarbons or petroleum products, petroleum by-products, radioactive
materials, asbestos or asbestos-containing materials, gasoline, diesel fuel,
pesticides, radon, urea formaldehyde, lead or lead-containing materials,
polychlorinated biphenyls.
"Hedging Agreements" shall mean any Interest Rate Protection
Agreement entered into from time to time among a Lender and the Borrower as
permitted by this Credit Agreement; provided, that the Administrative Agent
shall have received written notice thereof from such Lender within ten (10)
Business Days after execution of such Interest Rate Protection Agreement.
"Hedging Banks" shall mean any Lender or Lenders which have
entered into a Hedging Agreement.
"Hedging Obligations" shall mean all the obligations of the
Borrower to Hedging Banks under the Hedging Agreements.
"High Yield Unsecured Debt" shall mean unsecured Indebtedness
of the Borrower that is issued pursuant to written agreements containing
interest rates, payment terms, maturities, amortization schedules, covenants,
defaults, remedies and other material terms in form and substance satisfactory
to the Administrative Agent, the Collateral Monitoring Agent and the Co-Lead
Arrangers.
"Indebtedness" shall mean (without double counting), at any
time and with respect to any Person, (i) indebtedness of such Person for
borrowed money (whether by loan or the issuance and sale of debt securities) or
for the deferred purchase price of property or services purchased (other than
amounts constituting trade payables arising in the ordinary course of business
and payable in accordance with customary trading terms not in excess of 90
days); (ii) all indebtedness of such Person evidenced by a note, bond, debenture
or similar instrument (whether or not disbursed in full in the case of a
construction loan); (iii) indebtedness of others which such Person has directly
or indirectly assumed or guaranteed or otherwise provided credit support
therefor; (iv) indebtedness of others secured by a Lien on assets of such
Person, whether or not such Person shall have assumed such indebtedness
(provided, that if such Person has not assumed such indebtedness of another
Person then the amount of indebtedness of such Person pursuant to this clause
(iv) for purposes of this Credit Agreement shall be equal to the lesser of the
amount of the indebtedness of the other Person or the fair market value of the
assets of such Person which secures such other indebtedness); (v) obligations of
such Person in respect of letters of credit, acceptance facilities, or drafts or
similar instruments issued or accepted by banks and other financial institutions
for the account of such Person; (vi) any Guaranty by such Person; (vii)
obligations of such Person under Capital Leases; (viii) all obligations of such
Person under any Interest Rate Protection Agreement; and (ix) deferred payment
obligations of such Person resulting from the adjudication or settlement of any
litigation.
17
"Initial Date" shall mean (i) in the case of the
Administrative Agent, the Collateral Agent, the Collateral Monitoring Agent and
the Issuing Bank, the Closing Date, (ii) in the case of each Lender which is an
original party to this Credit Agreement, the Closing Date and (iii) in the case
of any other Lender, the effective date of the Assignment and Acceptance
pursuant to which it became a Lender.
"Instrument of Assumption and Joinder" shall mean an
Assumption and Joinder Agreement substantially in the form of Exhibit C hereto.
"Intercreditor Agreement" shall mean the Intercreditor and
Collateral Agency Agreement executed by the Collateral Agent, the Administrative
Agent and the Rollover Note Trustee substantially in the form of Exhibit G
hereto.
"Interest Deficit" shall have the meaning given to such term
in Section 2.19 hereof.
"Interest Payment Date" shall mean (i) as to any Base Rate
Loan, the last Business Day of each March, June, September and December
(commencing the last Business Day of December 2001) and (ii) as to any
Eurodollar Loan the last day of the applicable Interest Period; provided, that
in the case of an Interest Period with a duration in excess of three (3) months
an Interest Payment Date shall occur on each date occurring at three (3) month
intervals after the first day of such Interest Period.
"Interest Period" shall mean as to any Eurodollar Loan, the
period commencing on the date such Loan is made, continued or converted or the
last day of the preceding Interest Period and ending on the numerically
corresponding day (or if there is no corresponding day, then the last day) in
the calendar month that is one, two, three or six months thereafter as the
Borrower may elect; provided, however, that (i) if any Interest Period would end
on a day which shall not be a Business Day, such Interest Period shall be
extended to the next succeeding Business Day, unless such next succeeding
Business Day would fall in the next calendar month, in which case, such Interest
Period shall end on the next preceding Business Day, (ii) no Interest Period
with respect to a Term Loan or a Revolving Credit Loan (in each case
constituting a Eurodollar Loan) may be selected which would end later than the
Term Loan Maturity Date or the Revolving Credit Commitment Termination Date,
respectively, (iii) interest shall accrue from and including the first day of
such Interest Period to but excluding the last date of such Interest Period and
(iv) no Interest Period with respect to any portion of the B Term Loans or the
Delayed Draw Term Loans constituting a Eurodollar Loan may be selected which
extends beyond the date under which a mandatory repayment of such Tranche will
be required to be made under Section 2.12 hereof if the aggregate principal
amount of Eurodollar Loans which are B Term Loans or Delayed Draw Term Loans, as
applicable, which have Interest Periods ending after such date, will be in
excess of the aggregate principal amount of the B Term Loans or the Delayed Draw
Term Loans (as applicable) outstanding less the aggregate amount of such
mandatory prepayment on the applicable Tranche.
"Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate cap agreement, synthetic cap, collar or floor
or other financial agreement or arrangement designed to protect a Credit Party
against fluctuations in interest rates or to reduce the effect of any such
fluctuations.
18
"Interest Rate Type" shall have the meaning given to such term
in Section 2.5 hereof.
"Investment" shall mean any stock, evidence of indebtedness or
other security of any Person, any loan, advance, contribution of capital,
extension of credit or commitment therefor (including, without limitation, the
Guaranty of loans made to others, but excluding current trade and customer
accounts receivable arising in the ordinary course of business and payable in
accordance with customary trading terms in the ordinary course of business or
periodic payments made pursuant to settlements for satisfaction of outstanding
Receivables entered into in the ordinary course of business), and any purchase
of (i) any security of another Person or (ii) a line of business, or all or
substantially all of the assets, of any Person or any commitment to make any
such purchase.
"Issuing Bank" shall mean First Union National Bank or any
other Revolving Credit Lender which agrees to serve as issuer of Letters of
Credit hereunder.
"JCAHO" shall mean the Joint Commission on Accreditation of
Healthcare Organizations.
"Joint Venture" shall mean any Person (other than a wholly
owned Subsidiary of a Credit Party) in which an equity interest is, at the time
any determination is being made, owned or controlled by a Credit Party as
permitted by this Credit Agreement.
"L/C Exposure" shall mean, at any time, the amount expressed
in Dollars of the aggregate face amount of all drafts which may then or
thereafter be presented by beneficiaries under all Letters of Credit then
outstanding plus (without duplication), the face amount of all drafts which have
been presented or accepted under all Letters of Credit but have not yet been
paid or have been paid but not reimbursed, whether directly or from the proceeds
of a Revolving Credit Loan hereunder.
"Lender" and "Lenders" shall mean the financial institutions
whose names appear on the signature pages hereof and any assignee of a Lender
pursuant to Section 13.3 hereof, and their respective successors.
"Lending Office" shall mean, with respect to any of the
Lenders, the branch or branches (or Affiliate or Affiliates) from which such
Lender's Eurodollar Loans or Base Rate Loans, as the case may be, are made or
maintained and for the account of which all payments of principal of, and
interest on, such Lender's Eurodollar Loans or Base Rate Loans are made, as
notified to the Administrative Agent from time to time.
"Letter of Credit" shall mean a standby letter of credit
issued by the Issuing Bank pursuant to Section 2.21 hereof.
19
"Letter of Credit Fees" shall mean the fees payable in respect
of Letters of Credit pursuant to Section 2.21 hereof.
"LIBO Rate" shall mean, with respect to any Borrowing
consisting of Eurodollar Loans for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next 1/100 of 1%) appearing on Telerate
Page 3750 (or on any successor page) as the London interbank offered rate for
deposits in dollars at approximately 11:00 a.m. (London time) two (2) Business
Days prior to the commencement of such Interest Period with a maturity
comparable to such Interest Period. In the event that such rate is not available
at such time for any reason, then the "LIBO Rate" with respect to such Borrowing
of Eurodollar Loans for such Interest Period shall be the rate per annum at
which, as determined by the Administrative Agent, dollars in an amount
comparable to the amount of such Borrowing are being offered to leading banks at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the
commencement of the applicable Interest Period for settlement in immediately
available funds by leading banks in the London interbank market for a period
equal to the Interest Period selected.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
agreement to grant a security interest at a future date, any lease in the nature
of security, and the filing of, or agreement to give, any financing statement
under the Uniform Commercial Code of any jurisdiction).
"Loans" shall mean, collectively, the B Term Loans, the
Delayed Draw Term Loans and the Revolving Credit Loans. A "Loan" shall mean any
one of such Loans individually.
"LTM EBITDA" shall mean as of the date of determination
thereof with respect to any Swapped Facility or Real Property Asset exchanged
for a Swapped Facility unadjusted EBITDA for the prior twelve fiscal months
calculated solely for such Swapped Facility or Real Property Asset in accordance
with GAAP.
"Management Agreement" shall mean all management agreements to
which any Credit Party is a party providing for (i) the operation and management
by a third party of a healthcare facility owned or leased by such Credit Party
or (ii) the operation and management by such Credit Party of a healthcare
facility owned or leased by a third party.
"Margin Stock" shall be as defined in Regulation U of the
Board.
"Material Adverse Effect" shall mean any event or condition
that (i) has a material adverse effect on the business, assets, properties,
performance, operations, condition (financial or otherwise) or prospects of the
Credit Parties taken as a whole or of the Borrower, (ii) materially impairs the
ability of the Borrower or any Credit Party to perform its respective
obligations under any Fundamental Document to which it is or will be a party or
(iii) materially and adversely affects the Liens granted to the Collateral Agent
(for the benefit of Secured Parties) or materially impairs the validity or
enforceability of, or materially impairs the rights, remedies or benefits
available to the Collateral Agent or the Secured Parties; provided, however,
that any event or condition will be deemed to have a "Material Adverse Effect"
if such event or condition when taken together with all other events and
conditions occurring or in existence at such time (including all other events
and conditions which, but for the fact that a representation, warranty or
covenant is subject to a "Material Adverse Effect" exception, would cause such
representation or warranty contained herein to be untrue or such covenant to be
breached) would result in a "Material Adverse Effect", even though,
individually, such event or condition would not do so.
20
"Maximum Revolving Credit Amount" shall mean as of any date of
determination the lesser of (i) the Total Revolving Credit Commitment and (ii)
the amount by which the aggregate Borrowing Base exceeds the outstanding
principal amount of Term Loans as of such date of determination.
"Medicaid" shall mean collectively, the healthcare assistance
program established by Title XIX of the Social Security Act (42 U.S.C.
ss.ss.1396 et seq.) and any statutes succeeding thereto, and all laws, rules,
regulations, manuals, orders, guidelines or requirements pertaining to such
program including (a) all federal statutes (whether set forth in Title XIX of
the Social Security Act or elsewhere) affecting such program; (b) all state
statutes and plans for medical assistance enacted in connection with such
program and federal rules and regulations promulgated in connection with such
program; and (c) all applicable provisions of all rules, regulations, manuals,
orders and administrative, reimbursement, guidelines and requirements of all
Governmental Authorities promulgated in connection with such program (whether or
not having the force of law), in each case as the same may be amended,
supplemented or otherwise modified from time to time.
"Medicaid Receivable" shall mean a Receivable payable to a
Credit Party (i) pursuant to a Medicaid Provider Agreement or (ii) pursuant to
an assignment to such Credit Party under a Medicaid Provider Agreement.
"Medicaid Provider Agreement" shall mean an agreement entered
into between a health care facility, supplier or physician and CMS or any
federal or state agency or other entity administering Medicaid in such state, or
any other grant of authority by CMS or any federal or state agency or other
entity administering Medicaid in such state, under which the health care
facility, supplier or physician is authorized to provide medical goods and
services to Medicaid recipients and to be reimbursed by Medicaid for such goods
and services.
"Medicare" shall mean collectively, the health insurance
program for the aged and disabled established by Title XVIII of the Social
Security Act (42 U.S.C. ss.ss.1395 et seq.) and any statutes succeeding thereto,
and all laws, rules, regulations, manuals, orders or guidelines pertaining to
such program including (a) all federal statutes (whether set forth in Title
XVIII of the Social Security Act or elsewhere) affecting such program; and (b)
all applicable provisions of all rules, regulations, manuals, orders and
administrative, reimbursement, guidelines and requirements of all Governmental
Authorities promulgated in connection with such program (whether or not having
the force of law), in each case as the same may be amended, supplemented or
otherwise modified from time to time.
21
"Medicare Receivable" shall mean a Receivable payable to a
Credit Party (i) pursuant to a Medicare Provider Agreement or (ii) pursuant to
an assignment to such Credit Party under a Medicare Provider Agreement.
"Medicare Receivable Concentration Accounts" shall mean
concentration accounts established by the Credit Parties for the deposit of all
collections on Medicare Receivables as set forth on Schedule 8.3(c) hereto.
"Medicare Provider Agreement" shall mean an agreement entered
into between a health care facility, supplier or physician and CMS or any
federal or state agency or other entity administering Medicare in such state, or
other grant of authority by CMS or any federal or state agency or other entity
administering Medicare in such state, under which the health care facility,
supplier or physician is authorized to provide medical goods and services to
Medicare patients and to be reimbursed by Medicare for such goods and services.
"Moody's" shall mean Moody's Investors Service, Inc. or if
such company shall cease to issue ratings, another nationally recognized
statistical rating company selected in good faith by mutual agreement of the
Administrative Agent and the Borrower.
"Mortgage" shall mean a Mortgage, Open End Mortgage, Deed of
Trust, Trust Deed, Deed to Secure Debt, Credit Line Deed of Trust, Assignment,
Security Agreement and Financing Statement, substantially in the form of Exhibit
D hereto, executed and delivered by any Credit Party to the Collateral Agent
(for the benefit of the Secured Parties) and in each case, as such document may
be amended, amended and restated, supplemented or otherwise modified, renewed or
replaced from time to time.
"Mortgage Loan" shall mean a loan made to a Credit Party for
which the primary collateral is a Real Property Asset of such Credit Party.
"Multiemployer Plan" shall mean a plan described in Section
4001(a)(3) of ERISA to which any Credit Party or ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the five (5)
preceding plan years made or accrued an obligation to make contributions.
"Net Cash Proceeds" shall mean (a) the aggregate cash proceeds
received by a Credit Party or any Subsidiary thereof in a transaction permitted
under Section 6.7 hereof (including, without limitation, as applicable, all cash
proceeds received by way of deferred payment of principal pursuant to a note or
installment receivable or otherwise, but only as and when received) and minus
(b) reasonable and customary brokerage commissions and other reasonable and
customary fees and direct expenses (including reasonable and customary fees and
expenses of counsel and investment bankers actually paid by the applicable
Credit Party or Subsidiary) related to such transaction, minus (c) payments made
to retire Indebtedness (other than the Loans) secured by any assets being sold
or otherwise disposed of where payment of such Indebtedness is required in
connection with such sale or disposition, and minus (d) Restricted Payments
required to be made as a result of such sale or disposition to the extent
permitted to be made pursuant to Section 6.5(c) hereof (without duplication);
provided, that with respect to taxes, expenses shall only include taxes to the
extent that taxes are payable in cash in the current year or in the next
succeeding year with respect to the current year as a direct result of the
applicable transaction.
22
"Net Offering Proceeds" shall mean all cash received by the
Borrower or any Subsidiary as a result of the sale of any Capital Stock or
issuance of any Indebtedness, minus customary costs and discounts of issuance
paid by the Borrower, other than proceeds received by the Borrower from the
exercise of any warrant issued pursuant to the Plan of Reorganization, the
proceeds of which are used in accordance with the terms of Sections 2.11(m) and
6.5(e) hereof to redeem Rollover Preferred Stock.
"Net Value of Eligible Real Estate" shall mean the aggregate
net value of all Real Property Assets, excluding Real Property Assets which are
not currently utilized for ongoing operations or are subject to a Mortgage Loan,
based (i) upon a price per licensed bed enterprise valuation of (x) $45,000 per
bed with respect to Real Property Assets owned and operated by a Credit Party
and (y) $22,500 per bed with respect to Real Property Assets leased to and
operated by a Credit Party as such amounts per bed may be (A) increased from
time to time by the Collateral Agent, the Co-Lead Arrangers and the Collateral
Monitoring Agent in their sole discretion or (B) decreased from time to time by
the Collateal Agent, the Co-Lead Arrangers and the Collateral Monitoring Agent,
as the Collateral Agent, the Co-Lead Arrangers and the Collateral Monitoring
Agent may in their sole discretion deem appropriate based upon changed market
conditions or other changes in circumstances and (ii) in the case of Real
Property Assets other than health care facilities, the value of such Real
Property Assets as set forth in an appraisal report in form and substance
satisfactory to the Collateral Agent, the Collateral Monitoring Agent and the
Co-Lead Arrangers in their sole discretion.
"Non-Core Asset" shall be as described on Schedule 1.3 hereto.
"Non-Government Receivables" shall mean with respect to each
Credit Party, the Receivables of such Credit Party, other than Government
Receivables, together with any and all rights to receive payments due thereon,
and all proceeds thereof in any way derived, whether directly or indirectly.
"Obligations" shall mean (a) all obligations, whether direct
or indirect, contingent or absolute, of every type or description and at any
time existing, of the Borrower to make due and punctual payment of (i) principal
of and all interest on the Loans, the Fees, the Letter of Credit Fees, any
reimbursement obligations in respect of Letters of Credit, costs and attorneys'
fees and all other monetary obligations of the Borrower to the Agents, the
Issuing Bank, any Lender or any other Secured Party under or in respect of this
Credit Agreement, any note evidencing any of the Loans hereunder, any other
Fundamental Document or the Fee Letters, (ii) all Hedging Obligations and (iii)
amounts payable to First Union National Bank or any Lender in connection with
any bank account maintained by the Borrower or any other Credit Party at First
Union National Bank or any Lender or any other banking services (including,
without limitation, cash management services) provided to the Borrower or any
other Credit Party by First Union National Bank or any Lender with respect to,
or in any way related to or otherwise required by, any of the Fundamental
Documents (including, without limitation, interest accruing at the then
applicable rate provided in this Credit Agreement after the maturity of any of
the Loans, and interest accruing at the then applicable rate provided in this
Credit Agreement after the filing of any petition in bankruptcy or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower or any other Credit Party, whether or not a claim for post-filing
or post-petition interest is allowed in such proceeding) and (b) all other
obligations of the Borrower or any other Credit Party pursuant to this Credit
Agreement or any other Fundamental Document.
23
"Opt-Out Lender" shall have the meaning given to such term in
Section 2.11(h) hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any successor thereto.
"Percentage" shall mean with respect to any Lender, the
percentage of the Total Credit Exposure represented by such Lender's Credit
Exposure, or the percentage of the specified Commitments or Tranche of Loans
held by such Lender, as the context may require.
"Permitted Liens" shall mean Liens permitted under Section 6.2
hereof.
"Person" shall mean any natural person, corporation, division
of a corporation, partnership, limited liability partnership, limited liability
company, trust, joint venture, association, company, estate, unincorporated
organization or government or any agency or political subdivision thereof.
"Plan" shall mean an employee pension benefit plan within the
meaning of Section 3(2) of ERISA, other than a Multiemployer Plan, maintained or
contributed to by any Credit Party, or any ERISA Affiliate, or otherwise
pursuant to which any Credit Party could have liability.
"Plan of Reorganization" shall mean the plan of reorganization
filed with the Bankruptcy Court and confirmed by the order dated September 20,
2001 with respect to those certain cases pending under Chapter 11 of the
Bankruptcy Code in the District of Delaware filed by (i) the Borrower and
certain of its subsidiaries (Case Nos. 00-02691 through 00-2836 (JHW), which
cases are jointly administered as Case No. 00-2692 (JHW)) and (ii) Multicare
AMC, Inc. and certain of its subsidiaries (Case Nos. 00-2494 through 00-2690
(JHW) which cases are jointly administered as Case No. 00-2494 (JHW)), with such
amendments as may be approved by the Agents and the Co-Lead Arrangers.
"Pledged Collateral" shall mean the Pledged Securities and any
proceeds or products thereof or income therefrom, in any form, together with (i)
all profits, dividends and distributions to which a Pledgor shall at any time be
entitled in respect of its Pledged Securities; (ii) all other payments, if any,
due or to become due to a Pledgor in respect of its Pledged Securities, whether
as contractual obligations, damages, insurance proceeds, condemnation awards or
otherwise; (iii) all of a Pledgor's claims, rights, powers, privileges,
authority, options, security interest, liens and remedies, if any, under or
arising out of the ownership of such Pledgor's Pledged Securities; (iv) all
present and future claims, if any, of a Pledgor against the applicable entity in
which such Pledgor owns its Pledged Securities or under or arising out of the
applicable partnership or operating agreement, as applicable, for monies loaned
or advanced, for services rendered or otherwise; (v) to the extent permitted by
Applicable Law, all of a Pledgor's rights, if any, under the applicable
partnership or operating agreement, as applicable, or at law, to exercise and
enforce every right, power, remedy, authority, option and privilege of such
Pledgor relating to its Pledged Securities, including, without limitation, any
power to terminate, cancel or modify the applicable partnership or operating
agreement, as applicable, to execute any instruments and to take any and all
other action on behalf of and in the name of such Pledgor in respect of its
Pledged Securities and the entity in which such Pledgor owns its Pledged
Securities, to make determinations, to exercise any election (including, but not
limited to, election of remedies) or option or to give or receive any notice,
consent, amendment, waiver or approval, together with full power and authority
to demand, receive, enforce or collect any of the foregoing or any property of
the applicable entity, to enforce or execute any checks, or other instruments or
orders, to file any claims and to take any action in connection with any of the
foregoing; and (vi) to the extent not otherwise included, any and all proceeds
(as defined in Section 9-102(a)(64) of the UCC) of any or all of the foregoing.
24
"Pledged Securities" shall mean (i) the issued and outstanding
Capital Stock of those Subsidiaries directly or indirectly owned or controlled
by a Credit Party and initially listed on Schedule 3.21(a) hereto or hereafter
acquired by such Credit Party and (ii) all other equity interests now or
hereafter owned by a Credit Party initially listed on Schedule 3.21(a) hereto,
in each case, under the heading "Pledged Capital Stock and Other Pledged Equity
Interests."
"Pledgor" shall mean a Credit Party that owns any of the
Pledged Securities.
"Preferred Stock" shall mean Capital Stock of any class or
classes (however designated) which is preferred as to the payment of dividends,
or as to the distribution of assets upon any voluntary or involuntary
liquidation or dissolution of the issuer thereof, over shares of Capital Stock
of any other class of such issuer.
"Premises" shall mean any real property currently or formerly
owned, leased or operated by any Credit Party or any Subsidiary of any Credit
Party, including, but not limited to, all soil, surface water, or groundwater
thereat.
"Prepayment Date" shall have the meaning given to such term in
Section 2.11(l) hereof.
"Prime Rate" shall have the meaning given to such term in the
definition of "Base Rate" set forth in this Article 1.
"Pro Forma Basis" shall mean in connection with any
transaction for which a determination on a Pro Forma Basis is required to be
made hereunder, such determination shall be made (i) after giving effect to any
issuance of Indebtedness, any acquisition, any disposition or any other
transaction, as applicable, and (ii) assuming that the issuance of Indebtedness,
acquisition, disposition or other transaction and, if applicable, the
application of proceeds therefrom, occurred at the beginning of the most recent
Rolling Four Quarter period ending at least thirty (30) days prior to the date
on which such issuance of Indebtedness, acquisition, disposition or other
transaction occurred in accordance with Article 11 of Regulation S-X of the
Securities Exchange Act of 1934, as amended.
25
"Proprietary Rights" shall have the meaning given to such term
in Section 3.8(a) hereof.
"Purchasing Lender" shall have the meaning given to such term
in Section 2.16(e).
"Real Property Assets" shall mean as of any time, all parcels
of real property, owned and all health care facilities leased at such time
directly or indirectly by any Credit Party or any Subsidiary of a Credit Party,
together with in each case, all buildings, improvements, appurtenant fixtures
and equipment, easements and other property and rights incidental to the
ownership or lease (as applicable) of such parcel of real property or any of the
foregoing other than Excluded Properties.
"Receivables" shall mean all rights to receive payment from an
obligor for services rendered by the Credit Parties in the ordinary course of
business, including but not limited to those which, consistent with such Credit
Party's past accounting practice are classified as (i) Medicare Receivables,
(ii) CHAMPUS Receivables, (iii) CHAMPVA Receivables, (iv) Medicaid Receivables,
(v) TRICARE Receivables, (vi) Blue Cross/Blue Shield patient receivables, (vii)
non-contract patient receivables due from commercial insurance companies, (viii)
contract patient receivables due from health maintenance organizations, prepaid
plans, exclusive provider organizations, preferred provider organizations and
other managed care programs or (ix) private patient receivables representing
balances due from patients for deductibles, coinsurance, copayments and services
not otherwise covered by third party payors, which in any instance is not
evidenced by an instrument or chattel paper. Such amounts shall include all
interest, finance charges or other amounts legally payable by an obligor in
respect thereof. Calculations regarding the amount of any "Receivable" for
purposes of this definition shall be reduced (without duplication) by the
following adjustments determined in a manner consistent with the Credit and
Collection Policy: (i) contractual adjustments and discounts to the extent
necessary to reduce patient receivables to their respective net realizable
values based upon government mandated or contractually agreed upon reimbursement
levels, (ii) patient credit balances resulting from duplication of payments,
(iii) reserves for potential or actual payables to other non-governmental third
party payors and (iv) to the extent not reflected in the foregoing adjustments,
any other reserves and adjustments which are reflected on such Credit Party's
books and records (other than reserves relating to uncollectible accounts).
"Register" shall have the meaning given to such term in
Section 13.3(e).
"Regulation D" shall mean Regulation D of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation U" shall mean Regulation U of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation T" shall mean Regulation T of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
26
"Regulation X" shall mean Regulation X of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulatory Licenses" shall mean any and all licenses,
including provisional licenses, certificates of need, JCAHO and/or other
accreditations, permits, franchising rights to conduct business, approvals by a
Governmental Authority or otherwise, consents, qualifications, operating
authority and/or any other authorizations necessary for a Credit Party or any of
its Subsidiaries to operate their business.
"Reimbursement Approvals" shall mean, with respect to all
Third Party Payor Arrangements, any and all certifications, provider numbers,
provider agreements, (including, without limitation, Medicare Provider
Agreements and Medicaid Provider Agreements) participation agreements,
accreditations (including JCAHO accreditation) and/or any other agreements with
or approvals by organizations and Governmental Authorities, including, without
limitation, the right to reimbursement on a current basis and without
suspension, offset or recoupment, or in due course, as otherwise provided under
law or contract.
"Related Fund" shall mean, with respect to any Lender that is
an investment fund, any other investment fund that invests in commercial loans
and that is managed or advised by the same investment advisor as such Lender or
by an Affiliate of such investment advisor.
"Release" shall mean any discharging, disposing, emitting,
leaking, pumping, pouring, emptying, injecting, escaping, leaching, dumping or
spilling of any Hazardous Material into the Environment.
"Reportable Event" shall mean any reportable event as defined
in Section 4043(c) of ERISA other than those events as to which the 30-day
notice period is waived under subsection .22, .23, .25, .27 or .28 of PBGC
Regulation Section 4043.
"Required Lenders" shall mean Lenders having Credit Exposure
greater than fifty percent (50%) of the Total Credit Exposure; provided, that
for purposes of this definition, the Credit Exposure of a Lender shall be
disregarded if and for so long as such Lender shall be a Defaulting Lender.
"Required Revolving Credit Lenders" shall mean (i) Revolving
Credit Lenders holding greater than fifty percent (50%) of the unpaid principal
amount, if any, of the Revolving Credit Loans and L/C Exposure then outstanding
or (ii) if no Revolving Credit Loans and no Letters of Credit are then
outstanding, Revolving Credit Lenders holding greater than fifty percent (50%)
of the Total Revolving Credit Commitment; provided, that for purposes of this
definition, the Revolving Credit Loans, the pro rata portion of L/C Exposure or
the Revolving Credit Commitment of a Revolving Credit Lender shall be
disregarded if and for so long as such Revolving Credit Lender shall be a
Defaulting Lender.
"Requirements" shall mean all present and future laws,
statutes, codes, ordinances, orders, judgments, decrees, injunctions, rules,
regulations and requirements of every Governmental Authority having jurisdiction
over any Real Property Asset and all restrictive covenants applicable to any
Real Property Asset.
27
"Restricted Payment" shall mean (i) any distribution, dividend
or other direct or indirect payment on account of shares of any class of Capital
Stock of a Credit Party, (ii) any redemption or other acquisition,
re-acquisition or retirement by a Credit Party of any shares of any class of its
own Capital Stock or the Capital Stock of another Credit Party or an Affiliate,
now or hereafter outstanding, including, without limitation, the Rollover
Preferred Stock, (iii) any payment made to retire, or obtain the surrender of,
any outstanding warrants, puts or options or other rights to purchase or
otherwise acquire shares of any Capital Stock of a Credit Party or an Affiliate,
now or hereafter outstanding, (iv) any payment by a Credit Party of principal
of, premium, if any, or interest on, or any redemption, purchase, retirement,
defeasance, sinking fund or similar payment with respect to, the Rollover Notes,
any High Yield Unsecured Debt and any Indebtedness now or hereafter outstanding
which Indebtedness is subordinated to any of the Obligations, and (v) any
payment under any Synthetic Purchase Agreement.
"Revolving Credit Commitment" shall mean the commitment of
each Lender to make Revolving Credit Loans to the Borrower and to participate in
Letters of Credit from the Initial Date applicable to such Lender through the
Revolving Credit Commitment Termination Date up to an aggregate principal
amount, at any one time, not in excess of the amount set forth (i) under such
Lender's name opposite the column entitled "Revolving Credit Commitment" on the
signature pages hereto or (ii) in any applicable Assignment and Acceptance(s) to
which it may be a party, as the case may be, as such amount may be reduced from
time to time in accordance with the terms of this Credit Agreement.
"Revolving Credit Commitment Fee" shall have the meaning given
to such term in Section 2.8(a) hereof.
"Revolving Credit Commitment Termination Date" shall mean the
earlier of (i) the Revolving Credit Loan Maturity Date, and (ii) the date on
which the Total Revolving Credit Commitment shall terminate in accordance with
Section 2.9 or Article 7 hereof.
"Revolving Credit Lender" shall mean any Lender holding a
Revolving Credit Commitment hereunder.
"Revolving Credit Loan Maturity Date" shall mean the fifth
anniversary of the Closing Date.
"Rights" shall mean, with respect to the Government
Receivables of any Credit Party, the right to receive proceeds therefrom, as
permitted by Applicable Law.
"Revolving Credit Loans" shall have the meaning given to such
term in Section 2.2 hereof.
"Rolling Four Quarters" shall mean, with respect to any date
of determination, the fiscal quarter then ended and the three (3) immediately
preceding fiscal quarters considered as a single period.
"Rollover Noteholders" shall mean those entities holding
Rollover Notes.
28
"Rollover Notes" shall mean those certain notes issued under
the Rollover Note Indenture.
"Rollover Note Indenture" shall mean the Indenture dated as of
October 2, 2001 pursuant to which the Borrower has issued up to $242,605,000 of
Second Priority Secured Notes due 2007 in accordance with the Plan of
Reorganization, as such agreement may be further amended, amended and restated,
supplemented, modified, renewed or replaced from time to time.
"Rollover Note Trustee" shall mean The Bank of New York, or
its successor as trustee for the benefit of the Rollover Noteholders pursuant to
the Rollover Note Indenture.
"Rollover Preferred Stock" shall mean the 6% Convertible
Preferred Stock of the Borrower issued pursuant to the Plan of Reorganization.
"S&P" shall mean Standard & Poor's Ratings Group (a division
of The McGraw-Hill Companies, Inc.) or, if such company shall cease to issue
ratings, another nationally recognized statistical rating company selected in
good faith by mutual agreement of the Administrative Agent and the Borrower.
"Secured Parties" shall mean the Agents, the Issuing Bank, the
Lenders, the Hedging Banks and each of their respective successors and assigns.
"Senior Debt" shall mean the Indebtedness outstanding under
this Credit Agreement, and any other Indebtedness secured in whole or in part by
a mortgage or security interest or other Lien on assets of the Borrower or any
of its Subsidiaries (other than the Rollover Notes but including, without
limitation, the principal portion of any synthetic lease entered into by the
Borrower or any of its Subsidiaries).
"Senior Leverage Ratio" shall mean, at any date for which such
ratio is to be determined, the ratio of Senior Debt at such date to Consolidated
EBITDA for the most recent Rolling Four Quarter period.
"Specified Payments" shall mean payments in connection with
the transactions set forth on Schedule 1.4.
"Subordinated Debt" shall mean all Indebtedness of any of the
Credit Parties that is subordinated to the Obligations pursuant to written
agreements, containing interest rates, payment terms, maturities, amortization
schedules, covenants, defaults, remedies, subordination provisions and other
material terms in form and substance satisfactory to the Collateral Monitoring
Agent and the Co-Lead Arrangers.
"Subsidiary" shall mean with respect to any Person, any
corporation, association, joint venture, partnership or other business entity
(whether now existing or hereafter organized) of which at least a majority of
the voting stock or other ownership interests having ordinary voting power for
the election of directors (or the equivalent) is, at the time as of which any
determination is being made, owned or controlled by such Person or one or more
subsidiaries of such Person or by such Person and one or more subsidiaries of
such Person.
29
"Swapped Facility" shall have the meaning given to such term
in Section 6.7(a)(x).
"Synthetic Purchase Agreement" shall mean any swap, derivative
or other agreement or combination of agreements pursuant to which any Credit
Party is or may become obligated to make (i) any payment in connection with a
purchase by any third party from a Person other than a Credit Party of any
Capital Stock in any Credit Party or any Subordinated Debt or (ii) any payment
(other than on account of a permitted purchase by it of any Capital Stock in any
Credit Party or any Subordinated Debt) the amount of which is determined by
reference to the price or value at any time of any Capital Stock in any Credit
Party or any Subordinated Debt; provided, that no phantom stock or similar plan
providing for payments only to current or former directors, officers or
employees of a Credit Party (or to their heirs or estates) shall be deemed to be
a Synthetic Purchase Agreement.
"Term Loans" shall mean, collectively, the B Term Loans and
the Delayed Draw Term Loans. A "Term Loan" shall mean any one of such Loans
individually.
"Term Loan B Commitment" shall mean the commitment of each
Lender to make B Term Loans to the Borrower up to an aggregate principal amount,
at any one time, not in excess of the amount set forth (i) under such Lender's
name opposite the row entitled "Term Loan B Commitment" on the schedule pages
hereto or (ii) in any applicable Assignment and Acceptance(s) to which it may be
a party, as the case may be, as such amount may be reduced from time to time in
accordance with the terms of this Credit Agreement.
"Term Loan B Lender" shall mean any Lender holding a Term Loan
B Commitment hereunder.
"Term Loan Maturity Date" shall mean the earlier of (i) six
months after the fifth anniversary of the Closing Date and (ii) the date on
which the Term Loans shall become due and payable pursuant to Article 7 hereof.
"Third Party Payor Arrangements" shall mean any and all
arrangements with Medicare, Medicaid, CHAMPUS, CHAMPVA, TRICARE and any other
Governmental Authority, or quasi-public agency, Blue Cross, Blue Shield, any and
all managed care plans and organizations, including but not limited to health
maintenance organizations and preferred provider organizations, private
commercial insurance companies, employee assistance programs and/or any other
third party arrangements, plans or programs for payment or reimbursement in
connection with health care services, products or supplies.
"Title Company" shall mean LANDAMERICA or any other title
insurance company of recognized national standing which is acceptable to the
Collateral Agent in its sole discretion.
30
"Total Credit Commitments" shall mean the sum of the Total
Term Loan B Commitment, the Total Delayed Draw Term Loan Commitment and the
Total Revolving Credit Commitment.
"Total Credit Exposure" shall mean an amount equal to (i) the
aggregate principal amount of all outstanding Loans hereunder, plus (ii) the
then current amount of L/C Exposure, plus (iii) the aggregate amount of the
unused Total Credit Commitments then in effect.
"Total Delayed Draw Term Loan Commitment" shall mean the
aggregate amount of the Delayed Draw Term Loan Commitments then in effect of all
Delayed Draw Term Loan Lenders as such amount may be reduced or modified from
time to time in accordance with the terms of this Credit Agreement.
"Total Funded Debt" shall mean with respect to the Borrower
and its Subsidiaries, all Indebtedness of the Borrower and its Subsidiaries
which (i) as of the date of the creation or incurrence thereof, by its terms
matures in, or at the Borrower's or such Subsidiary's option can be extended
for, one year or more from such date of creation or incurrence (including
current portions of such long-term Indebtedness), including all hedging
agreements and letters of credit entered into in connection with such
Indebtedness and (ii) should be shown on the consolidated balance sheet of the
Borrower and its Subsidiaries in accordance with GAAP. The term "Total Funded
Debt" shall include, without limitation, Mortgage Loans, the Rollover Notes, and
the principal portion of any synthetic lease entered into by the Borrower or any
of its Subsidiaries.
"Total Leverage Ratio" shall mean, at any date for which such
ratio is to be determined, the ratio of Total Funded Debt of the Borrower and
its Consolidated Subsidiaries at such date to Consolidated EBITDA for the most
recent Rolling Four Quarter period.
"Total Revolving Credit Commitment" shall mean the aggregate
amount of the Revolving Credit Commitments then in effect of all of the
Revolving Credit Lenders, as such amount may be reduced or modified from time to
time in accordance with the terms of this Credit Agreement.
"Total Term Loan B Commitment" shall mean the aggregate amount
of the Term Loan B Commitments then in effect of all the Term Loan B Lenders as
such amount may be reduced or modified from time to time in accordance with the
terms of this Credit Agreement.
"Tranche" when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Credit Loans, Delayed Draw Term Loans or B Term Loans.
"TRICARE" shall mean, collectively, a program of medical
benefits covering former and active members of the uniformed services and
certain of their dependents, financed and administered by the United States
Departments of Defense, Health and Human Services and Transportation, which
program was formerly known as the Civilian Health and Medical Program of the
Uniformed Services (CHAMPUS), and all laws, rules, regulations, manuals, orders
and administrative, reimbursement and other guidelines of all Governmental
Authorities promulgated in connection with such program (whether or not having
the force of law), in each case as the same may be amended, supplemented or
otherwise modified from time to time.
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"TRICARE Receivable" shall mean a Receivable payable to a
Credit Party pursuant to TRICARE.
"UCC" shall mean the Uniform Commercial Code as in effect in
the State of New York from time to time.
"Uniform Customs" shall have the meaning given to such term in
Section 2.21(c) hereof.
2. THE LOANS
SECTION 2.1 B Term Loans. (a) Each Term Loan B Lender, severally and
not jointly, agrees, upon the terms and subject to the conditions hereinafter
set forth to make a term loan (each a "B Term Loan" and collectively the "B Term
Loans") to the Borrower on the Closing Date in a single draw in a principal
amount up to such Term Loan B Lender's Term Loan B Commitment.
(b) The B Term Loans shall be used to finance the Borrower's
obligations under the Plan of Reorganization (including refinancing the DIP
Facility, satisfying subclass G1-17 Claims (as set forth in the Final Order
approving the Plan of Reorganization) and payment of administrative claims),
Fees and other expenses incurred in connection with this Credit Agreement and
for general corporate purposes (including working capital expenditures) in
accordance with the provisions of this Credit Agreement.
(c) The B Term Loans shall be made by each Term Loan B Lender ratably
in accordance with its Term Loan B Percentage.
(d) Once repaid, no B Term Loans may be re-borrowed.
SECTION 2.2 Revolving Credit Loans. (a) Each Revolving Credit Lender,
severally and not jointly, agrees, upon the terms and subject to the conditions
hereinafter set forth, to make loans equal to such Revolving Credit Lender's
Revolving Credit Commitment (each a "Revolving Credit Loan" and collectively,
the "Revolving Credit Loans") to the Borrower on any Business Day and from time
to time from the Closing Date to but excluding the Revolving Credit Commitment
Termination Date; provided, that such Revolving Credit Loans when added to the
aggregate principal amount of all Revolving Credit Loans then outstanding to the
Borrower from all Revolving Credit Lenders, plus all Revolving Credit Lenders'
Revolving Credit Percentage of the then current L/C Exposure, does not exceed
the Maximum Revolving Credit Amount (after giving effect to all Revolving Credit
Loans repaid and all reimbursements of Letters of Credit made concurrently with
the making of any Revolving Credit Loans).
(b) The Revolving Credit Loans shall be used to finance the Borrower's
obligations under the Plan of Reorganization (including refinancing the DIP
Facility and payment of administrative claims), Fees and other expenses incurred
in connection with this Credit Agreement and for general corporate purposes
(including working capital expenditures) in accordance with the provisions of
this Credit Agreement.
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(c) Each Revolving Credit Loan requested hereunder on any date shall be
made by each Revolving Credit Lender ratably in accordance with its Revolving
Credit Percentage.
(d) Subject to the terms and conditions of this Credit Agreement, at
any time prior to the Revolving Credit Commitment Termination Date, the Borrower
may borrow, repay and re-borrow amounts constituting the Revolving Credit Loans.
SECTION 2.3 Delayed Draw Term Loans. (a) Each Delayed Draw Term Loan
Lender, severally and not jointly, agrees, upon the terms and subject to the
conditions hereinafter set forth to make a term loan (each a "Delayed Draw Term
Loan" and collectively, the "Delayed Draw Term Loans"), to the Borrower in up to
five (5) draws on any Business Day during the Delayed Draw Term Loan
Availability Period in a principal amount up to such Delayed Draw Term Loan
Lender's Delayed Draw Term Loan Commitment.
(b) The Delayed Draw Term Loans shall be used solely, (i) to make the
APS Acquisition, (ii) to pay the outstanding balance owed to ElderTrust or its
Affiliates on certain loans secured by mortgages on certain properties owned by
the Borrower or its Consolidated Subsidiaries, (iii) in connection with the
exercise of the Facility Purchase Options and the purchase of the facilities
that are the subject thereof and any fees and expenses incurred in connection
therewith and (iv) to make Specified Payments.
(c) The Delayed Draw Term Loans shall be made by each Delayed Draw Term
Loan Lender ratably in accordance with its Delayed Draw Term Loan Percentage.
(d) Once repaid, no Delayed Draw Term Loans may be re-borrowed.
SECTION 2.4 Disbursement of Funds and Notice of Borrowing. (a) The
Borrower shall give the Administrative Agent prior written, facsimile or
telephonic (promptly confirmed in writing) notice of each Borrowing hereunder;
such notice shall be irrevocable and to be effective, must be received by the
Administrative Agent not later than 12:00 noon (Eastern time), (i) in the case
of Base Rate Loans, on the Business Day on which such Loan is to be made and
(ii) in the case of Eurodollar Loans, on the third Business Day preceding the
date on which such Loan is to be made. Each such written notice or written
confirmation of telephonic notice shall be given in substantially the form of
the Borrowing Certificate appropriately completed to specify (A) the amount and
Tranche of the proposed Borrowing, (B) the date thereof (which shall be a
Business Day) and (C) whether the Loan(s) then being requested are to be (or
what portion or portions thereof are to be) a Base Rate Loan or a Eurodollar
Loan and the Interest Period or Interest Periods with respect thereto in the
case of Eurodollar Loans. In the case of a Eurodollar Loan, if no election of an
Interest Period is specified in such notice, such notice shall be deemed a
request for an Interest Period of one month. If no election is made as to the
Interest Rate Type of any Loan, such notice shall be deemed a request for a Base
Rate Loan.
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(b) The Administrative Agent shall promptly notify each Lender of its
proportionate share of each Borrowing, the date of such Borrowing, the Interest
Rate Type of each Loan being requested and the Interest Periods applicable
thereto. On the borrowing date specified in such notice, each Lender shall make
its proportionate share of the Borrowing available at the office of the
Administrative Agent, 201 South College Street, Charlotte, NC 28288, Attention:
Syndication Agency Services for credit to Genesis Health Ventures, Inc. and in
each case, no later than 2:00 p.m. Eastern time in the case of a Borrowing
consisting of Base Rate Loans and 1:00 p.m. Eastern time in the case of a
Borrowing consisting of Eurodollar Loans, in Federal or other immediately
available funds.
(c) Notwithstanding any provision to the contrary in this Credit
Agreement, the Borrower shall not, in any notice of Borrowing under this Section
2.4 request any Eurodollar Loan which, if made, would result in an aggregate of
more than seven (7) separate Eurodollar Loans (whether such Eurodollar Loans are
Revolving Credit Loans or Term Loans) of any Lender being outstanding hereunder
at any one time. For purposes of the foregoing, Eurodollar Loans having Interest
Periods commencing and ending on the same days shall be considered one (1)
single Eurodollar Loan.
(d) The aggregate amount of any Borrowing of a Loan consisting of a
Eurodollar Loan shall be in a minimum aggregate principal amount of $5,000,000
or such greater amount which is an integral multiple of $1,000,000, and the
aggregate amount of any Borrowing of a Loan consisting of a Base Rate Loan shall
be in a minimum aggregate principal amount of $2,000,000 or such greater amount
which is an integral multiple of $1,000,000 (or such lesser amount as shall
equal (i) the available but unused portion of the Total Credit Commitment then
in effect or (ii) the amount necessary to fund a drawing under a Letter of
Credit).
(e) The Administrative Agent shall disburse the proceeds of Loans by
depositing them (other than a Revolving Credit Loan used to fund a drawing under
a Letter of Credit) on the date of the Borrowing in an account of the Borrower
as the Borrower may specify to the Administrative Agent in writing.
SECTION 2.5 Interest Rate Type of the Loans. Each Loan shall be either
a Base Rate Loan or Eurodollar Loan (each such type of Loan, an "Interest Rate
Type") as the Borrower may request either (i) in its notice of Borrowing
delivered to the Administrative Agent pursuant to Section 2.4(a) hereof or (ii)
as such Loan may be continued or converted pursuant to the provisions of Section
2.14 hereof). Subject to Sections 2.16(d) and 2.18(g) hereof, each Lender may at
its option fulfill its obligations hereunder with respect to any Eurodollar Loan
by causing a foreign Lending Office to make such Loan; provided, that any
exercise of such option shall not affect the obligation of the Borrower to repay
such Loan in accordance with the terms hereof and of any note evidencing such
Loan. Subject to the other provisions of Section 2.4, Section 2.13(b) and
Section 2.17, Loans of more than one Interest Rate Type may be outstanding at
the same time.
SECTION 2.6 Repayment; Evidence of Debt; Administration. (a) The Loans
shall be subject to voluntary prepayment as provided in Section 2.10 hereto, to
mandatory prepayment as provided in Section 2.11 hereof, amortization as
provided in Section 2.12 hereof and acceleration as provided in Article 7
hereof.
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(b) The outstanding principal balance of the Revolving Credit Loans
shall be payable in full on the Revolving Credit Commitment Termination Date,
and the outstanding principal balance of the Term Loans shall be payable in full
on the Term Loan Maturity Date.
(c) Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing the indebtedness of the Borrower to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.
(d) The Administrative Agent shall maintain accounts in which it shall
record (i) the amount of each outstanding Loan hereunder, the Interest Rate Type
thereof and the Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(e) The entries made in the accounts maintained pursuant to paragraph
(c) or (d) of this Section 2.6 shall be prima facie evidence of the existence
and amounts of the Obligations recorded therein; provided, however, that the
failure of any Lender or the Administrative Agent to maintain such accounts or
any error therein shall not in any manner affect the obligation of the Borrower
to repay the Loans and other Obligations in accordance with the terms of this
Credit Agreement.
(f) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall promptly prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender
(or, if requested by such Lender, to such Lender and its registered assigns), in
substantially the form of Exhibit E hereto. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 13.3 hereof) be represented by one or more
promissory notes in such form payable to the order of the payee named therein.
(g) All amounts received by the Administrative Agent from or on behalf
of the Borrower as a payment or prepayment of, or interest on, the B Term Loans,
the Delayed Draw Loans or the Revolving Credit Loans shall be applied among the
Lenders holding the B Term Loans, the Delayed Draw Loans or the Revolving Credit
Loans, as the case may be, ratably in accordance with the outstanding B Term
Loans, the Delayed Draw Loans or the Revolving Credit Loans (as the case may be)
owed to each such Lender.
SECTION 2.7 Interest. (a) In the case of a Base Rate Loan, interest
shall be payable at a rate per annum (computed on the basis of the actual number
of days elapsed over a year of 360 days) equal to the Base Rate plus the
Applicable Interest Margin. Interest shall be payable in arrears on each Base
Rate Loan on each Interest Payment Date, on the Term Loan Maturity Date (in the
case of a Base Rate Loan which is a Term Loan), and on the Revolving Credit
Commitment Termination Date (in the case of a Base Rate Loan which is a
Revolving Credit Loan).
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(b) In the case of a Eurodollar Loan, interest shall be payable at a
rate per annum (computed on the basis of the actual number of days elapsed over
a year of 360 days) equal to the Adjusted LIBO Rate plus the Applicable Interest
Margin. Interest shall be payable on each Eurodollar Loan on each Interest
Payment Date, on the Term Loan Maturity Date (in the case of a Eurodollar Loan
which is a Term Loan), and on the Revolving Credit Commitment Termination Date
(in the case of a Eurodollar Loan which is a Revolving Credit Loan). The
Administrative Agent shall determine the applicable Adjusted LIBO Rate for each
Interest Period as soon as practicable on the date when such determination is to
be made in respect of such Interest Period and shall promptly notify the
Borrower and the Lenders of the applicable interest rate so determined. Such
determination shall be conclusive absent manifest error.
(c) Interest in respect of any Loan hereunder shall accrue from and
including the date of such Loan to but excluding the date on which such Loan is
paid or, if applicable, converted to a Loan of a different Interest Rate Type.
(d) Anything in this Credit Agreement or in any note evidencing any
Loan hereunder to the contrary notwithstanding, the interest rate on the Loans
or with respect to any drawing under a Letter of Credit shall in no event be in
excess of the maximum rate permitted by Applicable Law.
SECTION 2.8 Commitment Fees, Facility Fee and Other Fees. (a) The
Borrower agrees to pay to the Administrative Agent for the account of each
Revolving Credit Lender quarterly in arrears on the last Business Day of each
March, June, September and December (commencing the last Business Day of
December 2001) prior to the Revolving Credit Commitment Termination Date, on the
date of any termination or reduction of the Total Revolving Credit Commitment,
and on the Revolving Credit Commitment Termination Date, a fee (the "Revolving
Credit Commitment Fee") at a rate per annum set forth below on the average daily
amount during the preceding period by which such Revolving Credit Lender's
Revolving Credit Commitment (as such Revolving Credit Commitment may be modified
in accordance with the provisions of this Credit Agreement) exceeded the sum of
(i) the product of such Revolving Credit Lender's Revolving Credit Percentage
and the L/C Exposure, and (ii) the aggregate principal amount of such Revolving
Credit Lender's outstanding Revolving Credit Loans. The Revolving Credit
Commitment Fee shall be paid at a rate per annum (computed on the basis of the
actual number of days elapsed during the period over a year of 360 days)
determined in accordance with the following:
36
Percentage of Revolving Credit
Revolver Usage Commitment Fee
-------------- ----------------
less than or equal to 33% 1.00%
greater than 33% but less 0.75%
than or equal to 66%
greater than 66% 0.50%
(b) From and after the Closing Date, until the last day of the Delayed
Draw Term Loan Availability Period, the Borrower agrees to pay to the
Administrative Agent for the account of each Delayed Draw Term Loan Lender a
commitment fee (the "Delayed Draw Term Loan Commitment Fee") on any undrawn
portion of such Lender's Delayed Draw Term Loan Commitment at a rate per annum
of 3.50% (computed on the basis of the actual number of days elapsed during the
preceding period over a year of 360 days). The Delayed Draw Term Loan Commitment
Fee shall be payable quarterly in arrears on the last Business Day of each
March, June, September and December (commencing the last Business Day of
December 2001), on the date of any termination or reduction of the Total Delayed
Draw Term Loan Commitment and on the last day of the Delayed Draw Term Loan
Availability Period.
(c) The Commitment Fees shall commence to accrue on the Closing Date.
(d) The Borrower agrees to pay to the applicable party, on the Closing
Date, any and all Fees, expenses and other amounts that are then due and payable
pursuant to the Fee Letters and, thereafter, any and all Fees, expenses and
other amounts payable thereunder when due and payable.
SECTION 2.9 Termination and/or Reduction of the Total Revolving Credit
Commitment, the Total Term Loan B Commitment and the Total Delayed Draw Term
Loan Commitment. (a) Upon at least three (3) Business Days' prior written,
facsimile or telephonic notice (provided, that such telephonic notice is
immediately followed by written confirmation) to the Administrative Agent, the
Borrower may at any time in whole permanently terminate, or from time to time in
part permanently reduce, the Total Revolving Credit Commitment or the Total
Delayed Draw Term Loan Commitment. In the case of a partial reduction, each such
reduction shall be in a minimum aggregate principal amount of $5,000,000 or an
integral multiple thereof; provided, however, that the Total Revolving Credit
Commitment may not be reduced to an amount less than the aggregate principal
amount of all Revolving Credit Loans then outstanding, plus the then current L/C
Exposure.
(b) The Total Term Loan B Commitment shall automatically terminate on
the Closing Date (after giving effect to the making of any B Term Loans on the
Closing Date).
(c) The Total Delayed Draw Term Loan Commitment shall automatically
terminate on the last day of the Delayed Draw Term Loan Availability Period
(after giving effect to the making of any Delayed Draw Term Loans on such date).
37
(d) The Total Revolving Credit Commitment shall automatically and
permanently reduce, on the date of any mandatory prepayment or repayment of
Revolving Credit Loans, pursuant to Section 2.11(g) or 2.11(i) hereof, in an
amount equal to such mandatory prepayment or repayment of Revolving Credit
Loans.
(e) Any partial reduction of the Total Revolving Credit Commitment and
the Total Delayed Draw Term Loan Commitment, respectively, hereunder shall be
made among the Revolving Credit Lenders and the Delayed Draw Term Loan Lenders,
respectively, ratably in accordance with their respective Revolving Credit
Percentages and Delayed Draw Term Loan Percentages, as applicable.
(f) Simultaneously with each termination or reduction of the Total
Revolving Credit Commitment or the Total Delayed Draw Term Loan Commitment, the
Borrower shall pay to the Administrative Agent for the benefit of the Revolving
Credit Lenders and the Delayed Draw Term Loan Lenders, as applicable, all
accrued and unpaid Commitment Fees on the amount of the Total Revolving Credit
Commitment or the Total Delayed Draw Term Loan Commitment so terminated or
reduced through the date of such termination or reduction.
SECTION 2.10 Voluntary Prepayments. The Borrower shall have the right
at its option at any time and from time to time to prepay (i) any Base Rate
Loan, in whole or in part, upon same day prior written, facsimile, or telephonic
(promptly confirmed in writing) notice to the Administrative Agent received not
later than 11:30 a.m. (Eastern time) on such day, in the principal amount of
$2,000,000 or such greater amount which is an integral multiple of $1,000,000 if
prepaid in part, and (ii) any Eurodollar Loan, in whole or in part, upon same
day prior written, facsimile, or telephonic (promptly confirmed in writing)
notice received not later than 11:30 a.m. (Eastern time) on such day, in the
principal amount of $5,000,000 or such greater amount which is an integral
multiple of $1,000,000 if prepaid in part; provided, that in the case of
Eurodollar Loans the Borrower pays any amounts required to be paid under Section
2.15 as a result of such prepayment. Each notice of prepayment shall specify the
prepayment date, each Loan to be prepaid and the principal amount thereof, shall
be irrevocable and shall commit the Borrower to prepay each such Loan in the
amount and on the date stated therein. Except to the extent a Lender elects to
opt-out of such prepayment of a Term Loan pursuant to Section 2.11(h), all
prepayments under this Section 2.10 on account of Term Loans shall be applied
ratably to each Tranche of Loans in accordance with each Lender's proportionate
share of each such Tranche of Loans and against scheduled amortization payments
of the Term Loans in inverse order of the maturity thereof.
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SECTION 2.11 Mandatory Prepayments. (a) If at any time (i) the sum of
the aggregate principal amount of all Revolving Credit Loans outstanding, plus
the then current L/C Exposure shall exceed the Maximum Revolving Credit Amount,
the Borrower will immediately prepay such Revolving Credit Loans to the extent
necessary to eliminate such excess, and (ii) after giving effect to such
prepayment of Revolving Credit Loans, then to the extent that the aggregate
principal amount of all Term Loans outstanding exceeds the Borrowing Base, the
Borrower will immediately prepay such Term Loans to the extent necessary to
eliminate such excess.
(b) On or before December 31 in each year (commencing on December 31,
2002), the Borrower shall prepay Loans in an amount equal to 75% of the Excess
Cash Flow for the immediately preceding fiscal year. Concurrently with the
making of each such prepayment, the Borrower shall deliver to the Administrative
Agent, a certificate in such form as may be reasonably satisfactory to the
Administrative Agent, signed by the chief financial officer of the Borrower,
setting forth in reasonable detail the calculation of Excess Cash Flow for the
immediately preceding fiscal year.
(c) Within two (2) Business Days of the receipt of any Net Cash
Proceeds by the Borrower or any Credit Party, the Borrower shall prepay Loans in
an amount equal to 100% of the Net Cash Proceeds received by such Credit Party;
provided, that no prepayment shall be required to the extent such Net Cash
Proceeds (x) result from the sale of an asset (other than a Real Property Asset)
in the ordinary course of business of the Borrower and its Subsidiaries, (y) are
reinvested in the purchase assets to be used in the business of Credit Parties
within 180 days of the receipt of such Net Cash Proceeds so long as pending such
reinvestment any such Net Cash Proceeds are held in the Cash Collateral Account
and the aggregate amount so held does not at any time exceed $5,000,000 or (z)
result from the sale or other disposition of any Non-Core Asset and are actually
used to redeem the Rollover Preferred Stock at par to the extent permitted under
Sections 2.11(m) and 6.7 hereof.
(d) Within two (2) Business Days following the receipt by the Borrower
or any other Credit Party (or by the Collateral Agent as loss payee) of any
payment of proceeds of any insurance (other than business interruption
insurance) required to be maintained pursuant to this Credit Agreement or any
other Fundamental Document on account of each separate loss, damage or injury in
excess of $2,000,000 to any tangible real or personal property of the Borrower
or any of its Subsidiaries (provided, that in the case of a loss, damage or
injury to a Real Property Asset, so long as no Default or Event of Default shall
have occurred and then be continuing, such proceeds (or any portion thereof) may
be expended or irrevocably committed by the Borrower or any of its Subsidiaries
to repair or replace such property within 180 days of such loss, damage or
injury and the Borrower shall furnish to the Administrative Agent and the
Collateral Agent evidence satisfactory to the Administrative Agent and the
Collateral Agent of such expenditure or commitment and shall have certified to
the Administrative Agent and the Collateral Agent that such proceeds (or such
proceeds together with other funds available to the Borrower) are sufficient to
repair or replace such property pending which the Collateral Agent shall hold
such proceeds), the Borrower shall prepay or, to the extent the Collateral Agent
is loss payee under any insurance policy, irrevocably direct the Collateral
Agent to apply as a prepayment of the Loans, an amount equal to 100% (or such
lesser percentage which represents that portion of such proceeds not expended or
committed pursuant to the immediately preceding parenthetical phrase) of such
insurance proceeds; provided, that if an Event of Default shall have occurred
and be continuing, all proceeds of insurance required to be maintained pursuant
to this Credit Agreement or any other Fundamental Document which would otherwise
be payable to the Borrower shall be paid to the Collateral Agent and applied
pursuant to Section 12.2(b).
39
(e) At any time the Total Leverage Ratio is equal to or greater than
2.00:1.00, within two (2) Business Days of the receipt of any Net Offering
Proceeds from any sale of Capital Stock by the Borrower or any other Credit
Party, the Borrower shall prepay Loans in an amount equal to 50% of such Net
Offering Proceeds received.
(f) So long as no Default or Event of Default has occurred and is then
continuing, at any time the Borrower or any other Credit Party receives Net
Offering Proceeds from the issuance of Indebtedness, then within two (2)
Business Days of the receipt of such Net Offering Proceeds, the Borrower shall
prepay the Loans and the Rollover Notes in an amount equal to 100% of the Net
Offering Proceeds in accordance with the following:
(i) if after giving effect to the issuance of such Indebtedness,
the Senior Leverage Ratio on a Pro Forma Basis is not at least .375 less
than the Maximum Senior Leverage Ratio for the current test period as set
forth in Section 6.12 of this Credit Agreement, such Net Offering Proceeds
shall be applied to the outstanding principal balance (in inverse order of
maturity) of the B Term Loans and the Delayed Draw Term Loans ratably to
each Tranche of Loans in accordance with each Lender's proportionate share
of each Tranche of such Loans to the extent each Lender elects not to
opt-out of such prepayment pursuant to Section 2.11(h) until the Senior
Leverage Ratio is at least .375 less than the Maximum Senior Leverage Ratio
then permitted under Section 6.12 of this Credit Agreement for the current
test period and, thereafter, at the Borrower's option, to the outstanding
principal balance of the Rollover Notes;
(ii) if after giving effect to the issuance of such Indebtedness,
the Senior Leverage Ratio on a Pro Forma Basis is at least .375 less than
the Maximum Senior Leverage Ratio for the current test period as set forth
in Section 6.12 of this Credit Agreement, such Net Cash Proceeds may be
applied at the Borrower's option, to the Rollover Notes; and
(iii) to the extent the Borrower elects not to apply any Net Cash
Proceeds permitted by the preceding clauses (i) and (ii) to be applied to
the Rollover Notes, such Net Cash Proceeds shall be applied to the Loans in
the manner set forth in Section 2.11(g).
(g) So long as no Default or Event of Default has occurred and is then
continuing, any prepayments required under Section 2.11(b), (c), (d), (e) or
(f)(iii) shall be applied: (i) first to the outstanding principal balance (in
inverse order of maturity) of the B Term Loans and the Delayed Draw Term Loans
ratably to each Tranche of Loans in accordance with each Lender's proportionate
share of each Tranche of such Loans to the extent each Lender elects not to
opt-out of such prepayment pursuant to Section 2.11(h), (ii) second to the
outstanding principal balance of the Revolving Credit Loans ratably in
accordance with each Lender's proportionate share of Revolving Credit Loans and
(iii) third to the outstanding principal balance of the Rollover Notes.
40
(h) The Administrative Agent shall make the prepayments to each Lender
to the extent required by Sections 2.10 and 2.11(g) unless not later than 11:30
a.m. Eastern time two (2) Business Days prior to the making of such prepayment,
the Administrative Agent shall have received notice from a Term Loan B Lender or
Delayed Draw Term Loan Lender electing not to receive such prepayment (each such
Lender, an "Opt-Out Lender"). The amount that otherwise would be payable to each
Opt-Out Lender pursuant to Sections 2.10 or 2.11(g) with respect to such Opt-Out
Lender's B Term Loans or Delayed Draw Term Loans, as the case may be, shall
instead be distributed among the Lenders of the applicable Tranche (that are not
Opt-Out Lenders) ratably in accordance with their proportionate shares (after
giving effect to the prepayments to the accepting Lenders of such Tranche). If
the aggregate amount of voluntary prepayments to be distributed pursuant to
Section 2.10 on any Tranche of Term Loans that would otherwise be made to
Opt-Out Lenders exceeds the aggregate outstanding principal amount of all
outstanding Term Loans comprising such Tranche held by accepting Lenders (the
"Opt-Out Excess"), then the amount of such Opt-Out Excess shall be applied
first, to any Revolving Credit Loans then outstanding, and second, to
outstanding Term Loans of Opt-Out Lenders ratably in accordance with their
proportionate shares of such Tranche of Term Loans (after giving effect to the
prepayments to the accepting Lenders of such Tranche).
(i) If a Default or an Event of Default has occurred and is then
continuing, at any time a prepayment is required under Section 2.11(b), (c),
(d), (e) or (f), then such prepayment shall be applied to the outstanding
principal balance (in inverse order of maturity in the case of B Term Loans and
Delayed Draw Term Loans) of B Term Loans, Delayed Draw Term Loans and Revolving
Credit Loans ratably to each Tranche of Loans in accordance with each Lender's
proportionate share of each Tranche of such Loans.
(j) All prepayments of Loans under this Section 2.11 shall, as regards
Interest Rate Type, be applied first to Base Rate Loans, and subject to Section
2.11(l) hereof, then to Eurodollar Loans in the order of the scheduled expiry of
Interest Periods with respect thereto (i.e. those Eurodollar Loans with Interest
Periods which end sooner would be paid before those with Interest Periods which
end later).
(k) All prepayments under this Section 2.11 shall be accompanied by
accrued but unpaid interest on the principal amount being prepaid to (but not
including) the date of prepayment.
(l) If on any day on which Loans would otherwise be required to be
prepaid pursuant to this Section 2.11, but for the operation of this Section
2.11(l) (each a "Prepayment Date"), the amount of such required prepayment
exceeds the then outstanding aggregate principal amount of Base Rate Loans which
are of the Tranche required to be prepaid, and no Default or Event of Default
exists or is continuing, then on such Prepayment Date, (i) the Borrower shall
deposit Dollars into the Cash Collateral Account in an amount equal to such
excess, and only the outstanding Base Rate Loans which are of the Tranche
required to be prepaid shall be required to be prepaid on such Prepayment Date
and (ii) on the last day of each Interest Period after such Prepayment Date in
effect with respect to a Eurodollar Loan which is of the Tranche required to be
prepaid, the Administrative Agent is irrevocably authorized and directed to
apply funds from the Cash Collateral Account (and liquidate investments held in
the Cash Collateral Account as necessary) to prepay such Eurodollar Loans for
which the Interest Period is then ending to the extent funds are available in
the Cash Collateral Account.
41
(m) Notwithstanding the foregoing provisions of this Section 2.11,
receipt of the following amounts shall not be required to be applied as
mandatory prepayments on the Loans or the Rollover Notes to the extent actually
applied within two (2) Business Days of the receipt thereof by the Borrower or
any Subsidiary to redeem the Rollover Preferred Stock at par in accordance with
the terms thereof:
(i) any amount received by the Borrower with respect to settlement
or resolution of the Genesis Medicare Claim net of expenses incurred in
connection therewith;
(ii) any amount received by the Borrower with respect to settlement
or resolution of the AGE Claim net of expenses incurred in connection
therewith;
(iii) any amount received by the Borrower with respect to the sale
or other disposition of Non-Core Assets;
(iv) any amount received by the Borrower as proceeds from the
exercise of any warrants issued pursuant to the Plan of Reorganization; and
(v) any amount received by the Borrower as Net Offering Proceeds
from the issuance of any Capital Stock (other than the proceeds received
from the exercise of any warrants issued pursuant to the Plan of
Reorganization) to the extent such proceeds are not required to make a
mandatory prepayment pursuant to Section 2.11(e) hereof.
SECTION 2.12 Amortization. (a) On each date set forth below, the
Borrower shall be required to repay the principal amount of the B Term Loans, to
the extent then outstanding, in the amount set forth opposite such date:
- ------------------------------------------------------------------ ---------------------------------------------------
B Term Loan Payment Dates Amount
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in December, 2001 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in March, 2002 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in June, 2002 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in September, 2002 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in December, 2002 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in March, 2003 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
42
- ------------------------------------------------------------------ ---------------------------------------------------
B Term Loan Payment Dates Amount
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in June, 2003 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in September, 2003 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in December, 2003 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in March, 2004 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in June, 2004 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in September, 2004 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in December, 2004 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in March, 2005 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in June, 2005 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in September, 2005 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in December, 2005 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in March, 2006 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in June, 2006 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in September, 2006 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
The last Business Day occurring in December, 2006 $712,500.00
- ------------------------------------------------------------------ ---------------------------------------------------
Term Loan Maturity Date Outstanding Balance Due in Full
- ------------------------------------------------------------------ ---------------------------------------------------
(b) The Borrower shall be required to repay the principal amount of the
Delayed Draw Term Loans, to the extent then outstanding, quarterly, on the last
Business Day of each March, June, September and December (commencing on the
first such Business Day after the Delayed Draw Term Loan Commitment Termination
Date) (each such date hereinafter referred to as a "Quarterly Payment Date") and
on the Term Loan Maturity Date in the amounts set forth below opposite each
Quarterly Payment Date and the Term Loan Maturity Date:
43
- ---------------------------------------------------------------------- -----------------------------------------------
Delayed Draw Term Loan Quarterly Payment Dates Amount*
- ---------------------------------------------------------------------- -----------------------------------------------
First Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Second Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Third Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Fourth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Fifth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Sixth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Seventh Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Eighth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Ninth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Tenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Eleventh Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Twelfth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Thirteenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Fourteenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Fifteenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Sixteenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Seventeenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
**Eighteenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
- ----------------------
* The amortization amount for the Delayed Draw Term Loans will be adjusted
pro rata if less than the full amount of the Delayed Draw Term Loan
Commitment is borrowed as of the Delayed Draw Term Loan Commitment
Termination Date.
** The actual number of Quarterly Payment Dates will depend upon when the
Delayed Draw Term Loan Commitment Termination Date occurs, which will in
turn affect the commencement of amortization.
44
- ---------------------------------------------------------------------- -----------------------------------------------
Delayed Draw Term Loan Quarterly Payment Dates Amount*
- ---------------------------------------------------------------------- -----------------------------------------------
**Nineteenth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
**Twentieth Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
**Twenty-First Quarterly Payment Date $200,000.00
- ---------------------------------------------------------------------- -----------------------------------------------
Term Loan Maturity Date Outstanding Balance Due in Full
- ---------------------------------------------------------------------- -----------------------------------------------
SECTION 2.13 Default Interest; Alternate Rate of Interest. (a) In the
event that, and for so long as, any Event of Default shall have occurred and be
continuing, the Borrower shall on demand from time to time pay interest, to the
extent permitted by Applicable Law, on all Loans and overdue amounts outstanding
up to (but not including) the date of actual payment of such Loan or overdue
amount (after as well as before judgment) (i) for the remainder of the then
current Interest Period for each Eurodollar Loan, at 2% in excess of the rate
then in effect for each such Eurodollar Loan, (ii) for all periods subsequent to
the then current Interest Period for each Eurodollar Loan and for all Base Rate
Loans of a particular Tranche, at 2% in excess of the rate then in effect for
Base Rate Loans of the same Tranche and (iii) for all other overdue amounts
hereunder, at 2% in excess of the rate then in effect for Base Rate Loans which
are B Term Loans.
(b) In the event, and on each occasion, that on or before the day on
which the Adjusted LIBO Rate for a Eurodollar Loan is to be determined as set
forth herein, (i) the Administrative Agent shall have received notice from any
Lender of such Lender's determination (which determination, absent manifest
error, shall be conclusive) that Dollar deposits in an amount equal to the
principal amount of such Lender's Eurodollar Loan are not generally available in
the London Interbank Market or that the rate at which such Dollar deposits are
being offered will not adequately and fairly reflect the cost to such Lender of
making or maintaining the principal amount of such Lender's Eurodollar Loan
during the applicable Interest Period or (ii) the Administrative Agent shall
have determined that reasonable means do not exist for ascertaining the
applicable Adjusted LIBO Rate, the Administrative Agent shall, as soon as
practicable thereafter, give written or facsimile notice of such determination
by such Lender or the Administrative Agent to the Borrower and the Lenders and
any request by the Borrower for a Eurodollar Loan pursuant to Section 2.4 or
conversion to or continuation as a Eurodollar Loan pursuant to Section 2.14,
made after receipt of such notice and until the circumstances giving rise to
such notice no longer exist, shall be deemed to be a request for a Base Rate
Loan; provided, however, that in the circumstances described in clause (i)
above, such deemed request shall only apply to the affected Lender's portion
thereof.
SECTION 2.14 Continuation and Conversion of Loans. The Borrower shall
have the right, at any time, (i) to convert any Eurodollar Loan or portion
thereof to a Base Rate Loan or to continue any Eurodollar Loan for a successive
Interest Period, or (ii) to convert any Base Rate Loan or portion thereof to a
Eurodollar Loan, subject to the following:
45
(a) at least three (3) Business Days prior to any conversion or
continuation hereunder, the Borrower shall give the Administrative Agent
written, facsimile or telephonic (promptly confirmed in writing) notice with
respect thereto; such notice shall be irrevocable and to be effective, must be
received by the Administrative Agent on the day required not later than 11:30
a.m. Eastern time;
(b) unless the Required Lenders otherwise consent, no Event of Default
shall have occurred and be continuing at the time of any conversion to a
Eurodollar Loan or continuation of a Eurodollar Loan into a subsequent Interest
Period;
(c) the aggregate principal amount of Loans continued as, or converted
to, Eurodollar Loans as part of the same continuation or conversion, shall be in
a minimum amount of $5,000,000 or in such greater amount which is an integral
multiple of $1,000,000;
(d) if fewer than all Loans of a particular Tranche at the time
outstanding shall be continued or converted, such continuation or conversion
shall be made pro rata among the Lenders in accordance with the respective
principal amount of such Loans held by the Lenders immediately prior to such
continuation or conversion;
(e) no Base Rate Loan (or portion thereof) may be converted to a
Eurodollar Loan and no Eurodollar Loan may be continued as a Eurodollar Loan if,
after such conversion or continuation, and after giving effect to any concurrent
prepayment of Loans, an aggregate of more than the number of separate Eurodollar
Loans permitted under Section 2.4(c) hereof would be outstanding hereunder;
(f) the Interest Period with respect to a new Eurodollar Loan effected
by a continuation or conversion shall commence on the date of such continuation
or conversion;
(g) if a Eurodollar Loan is converted to a Base Rate Loan other than on
the last day of the Interest Period with respect thereto, the amounts required
by Section 2.15 shall be paid upon such conversion;
(h) accrued interest on a Eurodollar Loan (or portion thereof) being
converted to a Base Rate Loan shall be paid by the Borrower at the time of
conversion; and
(i) each request for a continuation as, or conversion to, a Eurodollar
Loan which fails to state an applicable Interest Period shall be deemed to be a
request for an Interest Period of one month.
Subject to the foregoing, in the event that the Borrower shall not give notice
to continue or convert any Eurodollar Loan as provided above, such Loan (unless
repaid) shall automatically be converted to a Base Rate Loan at the expiration
of the then current Interest Period. The Administrative Agent shall, after it
receives notice from the Borrower, promptly give the Lenders notice of any
continuation or conversion.
46
SECTION 2.15 Reimbursement of Lenders. (a) The Borrower shall reimburse
each Lender on demand for any loss incurred or to be incurred by such Lender in
the re-employment of the funds released (i) by any prepayment or conversion (for
any reason whatsoever) of a Eurodollar Loan if such Loan is prepaid or converted
prior to the last day of the Interest Period for such Loan or (ii) in the event
that after the Borrower delivers a notice of borrowing under Section 2.4 or
notice of continuation or conversion under Section 2.14 in respect of a
Eurodollar Loan, such Loan is not made, continued or converted on the first day
of the Interest Period specified in the applicable notice for any reason other
than (I) a suspension or limitation under Section 2.13(b) of the right of the
Borrower to select a Eurodollar Loan or (II) a breach by such Lender of its
obligation to fund such Borrowing when it was otherwise required to do so
hereunder. Such loss shall be the amount as reasonably determined by such Lender
as the excess, if any, of (A) the amount of interest which would have accrued to
such Lender on the amount so paid or not borrowed, continued or converted at a
rate of interest equal to the interest rate applicable to such Loan pursuant to
Section 2.7 hereof, for the period from the date of such payment or failure to
borrow, continue or convert to the last day (x) in the case of a payment prior
to the last day of the Interest Period for such Loan, of the then current
Interest Period for such Loan, or (y) in the case of a failure to borrow,
continue or convert, of the Interest Period for such Loan which would have
commenced on the date of such failure to borrow, continue or convert, over (B)
the amount realized by such Lender in re-employing the funds not advanced or the
funds received in prepayment or realized from the Loan not so continued or
converted during the period referred to above. Each Lender shall deliver to the
Borrower and to the Administrative Agent from time to time one or more
certificates setting forth the amount of such loss (and in reasonable detail the
manner of computation thereof) as determined by such Lender, which certificates
shall be conclusive absent manifest error. The Borrower shall pay such Lender
the amounts shown on such certificate within ten (10) days of the Borrower's
receipt of such certificate.
(b) In the event the Borrower fails to prepay any Loan on the date
specified in any prepayment notice delivered pursuant to Section 2.10, the
Borrower on demand by any Lender, shall pay to the Administrative Agent for the
account of such Lender any amounts required to compensate such Lender for any
actual loss incurred by such Lender as a result of such failure to prepay,
including, without limitation, any loss, cost or expenses incurred by reason of
the acquisition of deposits or other funds by such Lender to fulfill obligations
incurred in anticipation of such prepayment. Each Lender shall deliver to the
Borrower and to the Administrative Agent from time to time one or more
certificates setting forth the amount of such loss (and in reasonable detail the
manner of computation thereof) as determined by such Lender, which certificates
shall be conclusive absent manifest error. The Borrower shall pay the
Administrative Agent for the account of such Lender the amounts shown on such
certificate within ten (10) days of the Borrower's receipt of such certificate.
SECTION 2.16 Change in Circumstances. (a) In the event that after the
Initial Date, any change in Applicable Law or in the interpretation or
administration thereof (including, without limitation, any request, guideline or
policy not having the force of law) by any Governmental Authority charged with
the administration or interpretation thereof or, with respect to clauses (ii),
(iii) or (iv) below any changes in conditions, shall occur which shall:
47
(i) subject any Lender to, or increase the net amount of, any tax,
levy, impost, duty, charge, fee, deduction or withholding with respect to
any Eurodollar Loan (other than withholding tax imposed by the United States
of America or any political subdivision or taxing authority thereof or
therein or any other tax, levy, impost, duty, charge, fee, deduction or
withholding (x) that is measured with respect to the overall net income of
such Lender or of a Lending Office of such Lender, and that is imposed by
the United States of America, or by the jurisdiction in which such Lender or
Lending Office is incorporated, in which such Lending Office is located,
managed or controlled or in which such Lender has its principal office or a
presence not otherwise connected with, or required by, this transaction (or
any political subdivision or taxing authority thereof or therein), or (y)
that is imposed solely by reason of any Lender failing to make a declaration
of, or otherwise to establish, nonresidence, or to make any other claim for
exemption, or otherwise to comply with any certification, identification,
information, documentation or reporting requirements prescribed under the
laws of the relevant jurisdiction, in those cases where a Lender may
properly make such declaration or claim or so establish nonresidence or
otherwise comply); or
(ii) change the basis of taxation of any payment to any Lender of
principal of or interest on any Eurodollar Loan or other fees and amounts
payable to any Lender hereunder, or any combination of the foregoing, other
than withholding tax imposed by the United States of America or any
political subdivision or taxing authority thereof or therein or any other
tax, levy, impost, duty, charge, fee, deduction or withholding that is
measured with respect to the overall net income of such Lender or of a
Lending Office of such Lender, and that is imposed by the United States of
America, or by the jurisdiction in which such Lender or Lending Office is
incorporated, in which such Lending Office is located, managed or controlled
or in which such Lender has its principal office or a presence not otherwise
connected with, or required by, this transaction (or any political
subdivision or taxing authority thereof or therein); or
(iii) impose, modify or deem applicable any reserve, deposit or
similar requirement against any assets held by, deposits with or for the
account of, or loans or commitments by, an office of such Lender with
respect to any Eurodollar Loan; or
(iv) impose upon such Lender or the London Interbank Market any
other condition with respect to the Eurodollar Loans or this Credit
Agreement;
and the result of any of the foregoing shall be to increase the actual cost to
such Lender of making or maintaining any Eurodollar Loan hereunder or to reduce
the amount of any payment (whether of principal, interest or otherwise) received
or receivable by such Lender in connection with any Eurodollar Loan hereunder,
or to require such Lender to make any payment in connection with any Eurodollar
Loan hereunder, in each case by or in an amount which such Lender in its sole
judgment shall deem material, then and in each case, the Borrower agrees to pay
to the Administrative Agent for the account of such Lender, in accordance with,
and as provided in, paragraph (c) below, such amounts as shall be necessary to
compensate such Lender for such cost, reduction or payment.
48
(b) If at any time and from time to time after the Initial Date, any
Lender shall have determined that the applicability of any law, rule, regulation
or guideline regarding capital adequacy which is adopted after the Initial Date,
or any change in any law, rule, regulation or guideline regarding capital
adequacy or in the interpretation or administration of any of the foregoing by
any Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or the compliance by any Lender (or
any Lending Office of such Lender) or any Lender's holding company with any
request or directive issued after the Initial Date regarding capital adequacy
(whether or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate of return
on such Lender's capital or on the capital of such Lender's holding company, if
any, as a consequence of this Credit Agreement or the Loans made or Letters of
Credit issued pursuant hereto to a level below that which such Lender or such
Lender's holding company could have achieved but for such applicability,
adoption, change or compliance (taking into consideration such Lender's policies
and the policies of such Lender's holding company with respect to capital
adequacy) by an amount deemed by such Lender in its sole judgment to be
material, then from time to time the Borrower agrees to pay to the
Administrative Agent for the account of such Lender, in accordance with, and as
provided in, paragraph (c) below, such additional amount or amounts as will
compensate such Lender or such Lender's holding company for any such reduction
suffered to the extent attributable to this Credit Agreement or the Loans made
or Letters of Credit issued pursuant hereto.
(c) Each Lender shall deliver to the Borrower and to the Administrative
Agent from time to time one or more certificates setting forth the amounts due
to such Lender under paragraph (a) or (b) above, the changes as a result of
which such amounts are due and the manner of computing such amounts. Each such
certificate shall be conclusive in the absence of manifest error. The Borrower
shall pay to the Administrative Agent for the account of each such Lender the
amounts shown as due on any such certificate within ten (10) days after the
Borrower's receipt of the same. No failure on the part of any Lender to demand
compensation under paragraph (a) or (b) above on any one occasion shall
constitute a waiver of its right to demand such compensation on any other
occasion. The protection of this Section 2.16 shall be available to each Lender
regardless of any possible contention of the invalidity or inapplicability of
any law, regulation or other condition which shall give rise to any demand by
such Lender for compensation hereunder.
(d) Each Lender agrees that after it becomes aware of the occurrence of
an event or the existence of a condition that (i) would cause it to incur any
increased cost hereunder or render it unable to perform its agreements hereunder
for the reasons specifically set forth in Section 2.13(b), this Section 2.16,
Section 2.17 or Section 2.21(g) or (ii) would require the Borrower to pay an
increased amount under Section 2.13(b), this Section 2.16, Section 2.17 or
Section 2.21(g), it will use reasonable efforts to notify the Borrower in
writing of such event or condition and, to the extent not inconsistent with such
Lender's internal policies, will use its reasonable efforts to make, fund or
maintain the affected Loans of such Lender, or if applicable, participate in
Letters of Credit as required by Section 2.21, through another Lending Office of
such Lender if as a result thereof the additional monies which would otherwise
be required to be paid or the reduction of amounts receivable by such Lender
hereunder in respect of such Loans, Letters of Credit or participations therein
would be materially reduced, or such inability to perform would cease to exist,
or the increased costs which would otherwise be required to be paid in respect
of such Loans, Letters of Credit or participations pursuant to Section 2.13(b),
this Section 2.16, Section 2.17 or Section 2.21 would be materially reduced or
the taxes or other amounts otherwise payable under Section 2.13(b), this Section
2.16, Section 2.17 or Section 2.21 would be materially reduced, and if, as
determined by such Lender, in its sole discretion, the making, funding or
maintaining of such Loans, Letters of Credit or participations therein through
such other Lending Office would not otherwise materially adversely affect such
Loans, Letters of Credit or participations therein or such Lender.
49
(e) If the Borrower shall receive notice from any Lender that
Eurodollar Loans are no longer available from such Lender pursuant to Section
2.17, that amounts are due to such Lender pursuant to subparagraph (c) hereof,
that any of the events designated in subparagraph (d) hereof have occurred, or
that an event has occurred that would cause the Borrower to pay any amount
pursuant to clause (c) of Section 2.18, the Borrower may (but subject in any
such case to the payments required by this Credit Agreement, including, without
limitation Section 2.15 hereof), upon at least five (5) Business Days' prior
written or facsimile notice to such Lender and the Administrative Agent, but not
more than thirty (30) days after receipt of notice from such Lender, identify to
the Administrative Agent a lending institution ("Purchasing Lender") reasonably
acceptable to the Borrower and the Administrative Agent (and that qualifies as
an Eligible Assignee), which will purchase (for an amount, in immediately
available funds, equal to the principal amount of outstanding Loans payable to
such Lender, plus all accrued but unpaid interest and fees payable to such
Lender) the Commitments (if applicable), the amount of outstanding Loans and
participations in Letters of Credit (if applicable), from the Lender providing
such notice, and such Lender shall thereupon assign its Commitments (if
applicable), its participations in Letters of Credit (if applicable) and any
Loans owing to such Lender, and any notes held by such Lender to such Purchasing
Lender pursuant to Section 13.3 hereof.
SECTION 2.17 Change in Legality. (a) Notwithstanding anything to the
contrary contained elsewhere in this Credit Agreement, if any change after the
date hereof in Applicable Law, guideline or order, or in the interpretation
thereof by any Governmental Authority charged with the administration thereof,
shall make it unlawful for any Lender to make or maintain any Eurodollar Loan or
to give effect to its obligations as contemplated hereby with respect to a
Eurodollar Loan, then, by written notice to the Borrower and the Administrative
Agent, such Lender may (i) declare that Eurodollar Loans will not thereafter be
made by such Lender hereunder and/or (ii) require that, subject to Section 2.15,
all outstanding Eurodollar Loans made by it be converted to Base Rate Loans,
whereupon all of such Eurodollar Loans shall automatically be converted to Base
Rate Loans, as of the effective date of such notice as provided in paragraph (b)
below. Such Lender's pro rata portion of any subsequent Eurodollar Loan shall,
instead, be a Base Rate Loan unless such declaration is subsequently withdrawn.
(b) A notice to the Borrower by any Lender pursuant to paragraph (a)
above shall be effective for purposes of clause (ii) thereof, if lawful, on the
last day of the current Interest Period for each outstanding Eurodollar Loan;
and in all other cases, on the date of receipt of such notice by the Borrower.
SECTION 2.18 United States Withholding. (a) Prior to the Closing Date,
and prior to the effective date set forth in the Assignment and Acceptance with
respect to any Lender becoming a Lender after the date hereof, and from time to
time thereafter if requested by the Borrower or the Administrative Agent or
required because, as a result of a change in law or a change in circumstances or
otherwise, a previously delivered form or statement becomes incomplete or
incorrect in any material respect, each Lender organized under the laws of a
jurisdiction outside the United States shall provide, if applicable, the
Administrative Agent and the Borrower with complete, accurate and duly executed
forms or other statements prescribed by the Internal Revenue Service of the
United States certifying such Lender's exemption from, or entitlement to a
reduced rate of, United States withholding taxes (including backup withholding
taxes) with respect to all payments to be made to such Lender hereunder and
under any other Fundamental Document.
50
(b) The Borrower or the Administrative Agent shall be entitled to
deduct and withhold any and all present or future taxes or withholdings, and all
liabilities with respect thereto, from payments to a Lender hereunder or under
any other Fundamental Document, if and to the extent that the Borrower or the
Administrative Agent in good faith determines that such deduction or withholding
is required by the law of the United States, including, without limitation, any
applicable treaty of the United States. In the event the Borrower or the
Administrative Agent shall so determine that deduction or withholding of taxes
is required, it shall advise the affected Lender as to the basis of such
determination prior to actually deducting and withholding such taxes. In the
event the Borrower or the Administrative Agent shall so deduct or withhold taxes
from amounts payable hereunder, it (i) shall pay to, or deposit with, the
appropriate taxing authority in a timely manner the full amount of taxes it has
deducted or withheld; (ii) shall provide to each Lender from whom taxes were
deducted or withheld, evidence of payment of such taxes to, or the deposit
thereof with, the appropriate taxing authority and a statement setting forth the
amount of taxes deducted or withheld, the applicable rate, and any other
information or documentation reasonably requested by such Lender; and (iii)
shall forward to each such Lender any official tax receipts or other
documentation with respect to the payment or deposit of the deducted or withheld
taxes as may be issued from time to time by the appropriate taxing authority.
Unless the Borrower and the Administrative Agent have received forms or other
documents satisfactory to them indicating that payments hereunder or under any
note evidencing the Loans hereunder are not subject to United States withholding
tax or are subject to such tax at a rate reduced by an applicable tax treaty,
the Borrower or the Administrative Agent may withhold taxes from such payments
at the applicable statutory rate in the case of payments to or for any Lender
organized under the laws of a jurisdiction outside the United States.
(c) Each Lender agrees (i) that as between it and the Borrower or the
Administrative Agent, such Lender shall be the Person to deduct and withhold
taxes, and to the extent required by law, it shall deduct and withhold taxes on
amounts that such Lender may remit to any other Person(s) by reason of any
undisclosed transfer or assignment of an interest in this Credit Agreement to
such other Person(s) pursuant to Section 13.3; and (ii) to indemnify the
Borrower and the Administrative Agent and any officers, directors, partners,
limited liability company members, agents, employees or representatives of the
Borrower or the Administrative Agent against, and to hold them harmless from,
any tax, interest, additions to tax, penalties, reasonable counsel and
accountants' fees, disbursements or payments arising from the assertion by any
appropriate taxing authority of any claim against them relating to a failure to
withhold taxes as required by law with respect to amounts described in clause
(i) of this paragraph (c) or arising from the reliance by the Borrower or the
Administrative Agent on any form or other document furnished by such Lender and
purporting to establish a basis for not withholding, or for withholding at a
reduced rate, taxes with respect to payments hereunder or under any other
Fundamental Document.
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(d) Each assignee of a Lender's interest in this Credit Agreement in
conformity with Section 13.3 shall be bound by this Section 2.18, so that such
assignee will have all of the obligations and provide all of the forms and
statements and all indemnities, representations and warranties required to be
given under this Section 2.18.
(e) Notwithstanding the foregoing, in the event that any withholding
taxes or additional withholding taxes shall become payable solely as a result of
any change in any statute, treaty, ruling, determination or regulation occurring
after the Initial Date in respect of any sum payable hereunder or under any
other Fundamental Document to any Lender or any of the Agents (i) the sum
payable by the Borrower shall be increased as may be necessary so that after
making all required deductions (including deductions applicable to additional
sums payable under this Section 2.18) such Lender or the applicable Agent (as
the case may be) receives an amount equal to the sum it would have received had
no such withholding deductions been made, (ii) the Borrower shall make such
deductions, (iii) the Borrower shall pay the full amount deducted to the
relevant taxation authority or other authority in accordance with Applicable Law
and (iv) the Borrower shall forward to such Lender or the applicable Agent (as
the case may be) the official tax receipts or other documentation pursuant to
and as set forth in Section 2.18(b). In addition, the Borrower shall indemnify
each Lender and each of the Agents for any additional withholding taxes paid by
such Lender or such Agent, as the case may be, or any liability (including
penalties and interest) arising therefrom or with respect thereto, whether or
not such additional withholding taxes were correctly or legally asserted.
(f) In the event that a Lender or an Agent receives a refund of or
credit for taxes withheld or paid pursuant to this Section 2.18, which credit or
refund is identifiable by such Lender or such Agent (as applicable) as being a
result of taxes withheld or paid in connection with sums payable hereunder or
under any other Fundamental Document, such Lender or such Agent (as applicable)
shall promptly notify the Administrative Agent and the Borrower and shall remit
to the Borrower the amount of such refund or credit allocable to payments made
hereunder or under any other Fundamental Document.
(g) Each Lender agrees that after it becomes aware of the occurrence of
an event that would cause the Borrower to pay any amount pursuant to clause (e)
of this Section 2.18, it will use reasonable efforts to notify the Borrower of
such event and, to the extent not inconsistent with such Lender's internal
policies, will use its reasonable efforts to make, fund or maintain the affected
Loans of such Lender through another Lending Office of such Lender if as a
result thereof the additional monies which would otherwise be required to be
paid by reason of Section 2.18(e) in respect of such Loans would be materially
reduced, and if, as determined by such Lender, in its discretion, the making,
funding or maintaining of such Loans through such other Lending Office would not
otherwise materially adversely affect such Loans or such Lender.
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(h) For any period with respect to which a Lender has failed to provide
the Borrower with the appropriate form pursuant to Section 2.18(a) (unless such
failure is due to a change in treaty, law or regulation occurring subsequent to
the date on which a form originally was required to be provided), such Lender
shall not be entitled to indemnification under Section 2.18(e); provided,
however, that should a Lender, which is otherwise exempt from or subject to a
reduced rate of withholding tax, become subject to taxes because of its failure
to deliver a form required hereunder, the Borrower shall take such steps as such
Lender shall reasonably request to assist such Lender to recover such taxes.
SECTION 2.19 Interest Adjustments. If the provisions of this Credit
Agreement or any note evidencing any of the Loans hereunder would at any time
require payment by the Borrower to a Lender of any amount of interest in excess
of the maximum amount then permitted by the law applicable to any Loan, the
applicable interest payments to that Lender in connection with such Loan shall
be reduced to the extent and in such a manner as is necessary in order that such
Lender shall not receive interest in excess of such maximum amount. If, as a
result of the foregoing, a Lender shall receive interest payments hereunder with
respect to a Loan or under a note evidencing such Loan in an amount less than
the amount otherwise provided hereunder, such deficit (hereinafter called the
"Interest Deficit") will, to the fullest extent permitted by Applicable Law,
cumulate and will be carried forward (without interest) until the Facility
Termination Date (except to the extent paid pursuant to the immediately
succeeding sentence). Interest otherwise payable to a Lender hereunder with
respect to such Loan and under any note evidencing such Loan for any subsequent
period shall be increased by the maximum amount of the Interest Deficit that may
be so added without causing such Lender to receive interest in excess of the
maximum amount then permitted by Applicable Law.
The amount of any Interest Deficit relating to any Loan and any note
evidencing such Loan shall be treated as a prepayment premium and shall, to the
fullest extent permitted by Applicable Law, be paid in full at the time of any
optional prepayment by the Borrower to the Lenders of all the Loans within the
applicable Tranche at that time outstanding pursuant to Section 2.10 hereof. The
amount of any Interest Deficit relating to a Loan and any note at the time of
any complete payment of the Loans within the applicable Tranche at that time
outstanding (other than an optional prepayment thereof pursuant to Section 2.10
hereof) shall be canceled and not paid.
SECTION 2.20 Manner of Payments. Except as provided in Section 2.11(k)
hereof, all payments of principal and interest by the Borrower in respect of any
Loans shall be allocated pro rata among the Lenders holding such Loans in
accordance with the then outstanding principal amounts of such Loans held by
them. All payments by the Borrower hereunder and under any notes evidencing the
Loans hereunder shall be made without offset, counterclaim, recoupment, defense,
setoff or other deduction in Dollars, in Federal or other immediately available
funds, at the office of the Administrative Agent, 201 South College Street,
Charlotte, NC 28288, Attention: Syndication Agency Services, for credit to
Genesis Health Ventures, Inc., no later than 1:00 p.m.(Eastern time), on the
date on which such payment shall be due. Any payment received at such office
after such time shall be deemed received on the following Business Day.
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SECTION 2.21 Letters of Credit. (a) (i) Upon the terms and subject to
the conditions hereof and of Applicable Law, the Issuing Bank agrees, upon the
request of the Borrower, to issue Letters of Credit (and to extend Letters of
Credit previously issued hereunder) payable in Dollars from time to time after
the Closing Date and prior to the Revolving Credit Commitment Termination Date;
provided, however, that (A) the Borrower shall not request, and the Issuing Bank
shall not issue, any Letter of Credit if, after giving effect thereto, the sum
of the then current L/C Exposure, plus the aggregate principal amount of all
Revolving Credit Loans then outstanding would exceed the Maximum Revolving
Credit Amount, (B) the Borrower shall not request, and the Issuing Bank shall
not issue, any Letter of Credit having an expiration date (x) later than the
tenth day prior to the Revolving Credit Commitment Termination Date or (y) more
than one year after its date of issuance or extension; provided, however, that a
Letter of Credit may, if requested by the Borrower, provide that such Letter of
Credit is renewable for successive periods of one year or less, unless the
Issuing Bank shall have delivered a notice of non-renewal to the beneficiary of
such Letter of Credit and (C) the Borrower shall not request, and the Issuing
Bank shall not issue, any Letter of Credit if, after giving effect thereto, the
then current L/C Exposure with respect to Letters of Credit would exceed
$15,000,000.
(ii) Immediately upon the issuance of each Letter of Credit, each
Revolving Credit Lender shall be deemed to, and hereby agrees to, have
irrevocably purchased from the Issuing Bank a participation in such Letter
of Credit in accordance with such Revolving Credit Lender's Revolving Credit
Percentage.
(iii) Each Letter of Credit may, at the option of the Issuing Bank,
provide that the Issuing Bank may (but shall not be required to) pay all or
any part of the maximum amount which may at any time be available for
drawing thereunder to the beneficiary thereof upon the occurrence or
continuation of an Event of Default and the acceleration of the maturity of
the Loans; provided, that, if payment is not then due to the beneficiary,
the Issuing Bank shall deposit the funds in question in a segregated account
with the Issuing Bank to secure payment to the beneficiary and any funds so
deposited shall be paid to the beneficiary of the Letter of Credit if
conditions to such payment are satisfied or returned to the Issuing Bank for
distribution to the Revolving Credit Lenders (or, if all Obligations shall
have been indefeasibly paid in full in cash, to the Borrower) if no payment
to the beneficiary has been made and the final date available for drawings
under the Letter of Credit has passed. Each payment or deposit of funds by
the Issuing Bank as provided in this paragraph shall be treated for all
purposes of this Credit Agreement as a drawing duly honored by such Issuing
Bank under the related Letter of Credit.
(b) Whenever the Borrower desires the issuance of a Letter of Credit,
it shall deliver to the Administrative Agent and the Issuing Bank a written
notice no later than 1:00 p.m. (Eastern time) at least two (2) Business Days
prior to the proposed date of issuance (or such lesser time as is acceptable to
the Issuing Bank). Such notice shall specify (i) the proposed date of issuance
(which shall be a Business Day), (ii) the face amount of the Letter of Credit,
(iii) the expiration date of the Letter of Credit and (iv) the name and address
of the beneficiary. Such notice shall be accompanied by a brief description of
the underlying transaction and upon request of the Issuing Bank or the
Administrative Agent, the Borrower shall provide additional details regarding
the underlying transaction. Concurrently with the giving of written notice of a
request for the issuance of a Letter of Credit, the Borrower shall specify a
precise description of the documents and the verbatim text of any certificate to
be presented by the beneficiary of such Letter of Credit which, if presented by
such beneficiary prior to the expiration date of the Letter of Credit, would
require the Issuing Bank to make payment under the Letter of Credit; provided,
however, that the Issuing Bank, in its reasonable discretion, may require
customary changes in any such documents and certificates to be presented by the
beneficiary. Any Letter of Credit shall be issued solely for one of the
following purposes: (1) to provide credit support for the Borrower's obligations
under and pursuant to a Hedging Agreement in accordance with the terms of the
applicable Hedging Agreement, (2) to provide credit support for indemnity
obligations of a Credit Party or Subsidiary thereof in connection with the sale
or lease of an asset permitted hereunder (provided, that the applicable
indemnity obligation is not prohibited by the terms of this Credit Agreement),
(3) in connection with a Permitted Lien or (4) for such other purpose as has
been approved by the Administrative Agent and the Issuing Bank. Upon issuance of
each Letter of Credit, the Issuing Bank shall notify the Administrative Agent of
the issuance of such Letter of Credit. Promptly after receipt of such notice,
the Administrative Agent shall notify each Revolving Credit Lender of the
issuance and the amount of such Revolving Credit Lender's respective
participation in the applicable Letter of Credit.
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(c) Each Letter of Credit shall be subject to (i) the Uniform Customs
and Practice for Documentary Credits, International Chamber of Commerce
Publication No. 500, or any successor publication, as adopted or amended from
time to time (the "Uniform Customs") and (ii) as to matters not addressed by the
Uniform Customs, the law of the State of New York (or, if the Issuing Bank so
elects, the law of the jurisdiction in which the office from which it issues its
Letters of Credit is located). The Issuing Bank shall be entitled to honor any
drafts and accept any documents presented to it by the beneficiary of such
Letter of Credit in accordance with the terms of such Letter of Credit and
believed by the Issuing Bank in good faith to be genuine. The Issuing Bank shall
not have any duty to inquire as to the accuracy or authenticity of any draft or
other drawing documents which may be presented to it, but shall be responsible
only to determine in accordance with customary commercial practices that the
documents which are required to be presented before payment or acceptance of a
draft under any Letter of Credit have been delivered and that they comply on
their face with the requirements of such Letter of Credit.
(d) If the Issuing Bank shall make payment on any draft presented under
a Letter of Credit (regardless of whether a Default, Event of Default or
acceleration has occurred), the Issuing Bank shall give notice of such payment
to the Administrative Agent and the Revolving Credit Lenders, and each Revolving
Credit Lender hereby authorizes and requests the Issuing Bank to advance for its
account, pursuant to the terms hereof, its share of such payment based upon its
participation in the Letter of Credit and agrees promptly to reimburse the
Issuing Bank in immediately available funds in Dollars for the amount so
advanced on its behalf by the Issuing Bank. If any such reimbursement is not
made by any Revolving Credit Lender in immediately available funds on the same
day on which the Issuing Bank shall have made payment on any such draft, such
Revolving Credit Lender shall pay interest thereon to the Issuing Bank at a rate
per annum equal to the Issuing Bank's cost of obtaining overnight funds in the
Federal Funds market for the first three (3) days following the time when such
Revolving Credit Lender fails to make the required reimbursement, and thereafter
at a rate per annum equal to the Base Rate plus the Applicable Interest Margin
for Base Rate Loans which are Revolving Credit Loans.
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(e) The Borrower is absolutely, unconditionally and irrevocably
obligated to reimburse all amounts drawn under each Letter of Credit. If any
draft is presented under a Letter of Credit, the payment of which is required to
be made at any time on or before the Revolving Credit Commitment Termination
Date, then payment by the Issuing Bank of such draft shall constitute a
Revolving Credit Loan (which is a Base Rate Loan) hereunder and interest shall
accrue from the date the Issuing Bank makes payment on such draft under such
Letter of Credit. If any draft is presented under a Letter of Credit, the
payment of which is required to be made after the Revolving Credit Commitment
Termination Date or at the time when an Event of Default or Default shall have
occurred and then be continuing, then the Borrower shall immediately pay to the
Issuing Bank, in immediately available funds, the full amount of such draft
together with interest thereon at a rate per annum of 2% in excess of the rate
then in effect for Revolving Credit Loans which are Base Rate Loans from the
date on which the Issuing Bank makes such payment of such draft until the date
it receives full reimbursement for such payment from the Borrower. The Borrower
further agrees that the Issuing Bank may reimburse itself for such drawing from
the balance in any other account of the Borrower maintained with the Issuing
Bank.
(f) (i) The Borrower agrees to pay the following amounts to the Issuing
Bank with respect to Letters of Credit issued by it hereunder:
(A) with respect to the issuance, amendment, transfer or other
transaction related to a Letter of Credit and each drawing made
thereunder, documentary and processing charges in accordance with the
Issuing Bank's standard schedule for such charges in effect at the time
of such issuance, amendment, transfer, drawing or other transaction, as
the case may be; and
(B) a fronting fee payable directly to the Issuing Bank, for
its sole account, for the period from and including the Closing Date
to, but excluding, the Revolving Credit Commitment Termination Date
computed at a rate equal to one-quarter of one percent (1/4 of 1%) per
annum of the daily average L/C Exposure (calculated in the same manner
as interest on a Eurodollar Loan), such fee to be due and payable in
arrears on and through the last Business Day of each March, June,
September and December in each year (commencing on the last Business
Day of December 2001) prior to the Revolving Credit Commitment
Termination Date or the expiration of the last outstanding Letter of
Credit (whichever is later) and on the later of the Revolving Credit
Commitment Termination Date and the expiration of the last outstanding
Letter of Credit.
(ii) The Borrower agrees to pay to the Administrative Agent for
distribution to each Revolving Credit Lender in respect of its L/C Exposure,
such Revolving Credit Lender's pro rata share (based on its Revolving Credit
Commitment) of a commission equal to (A) a per annum percentage rate equal
to the Applicable Interest Margin for Revolving Credit Loans which are
Eurodollar Loans multiplied by (B) the average daily amount of the L/C
Exposure. Such commission shall be calculated in the same manner as interest
on a Eurodollar Loan and shall be due and payable in arrears on and through
the last Business Day of each March, June, September and December
(commencing the last Business Day of December 2001) prior to the Revolving
Credit Commitment Termination Date or the expiration of the last outstanding
Letter of Credit (whichever is later) and on the later of the Revolving
Credit Commitment Termination Date and the expiration of the last
outstanding Letter of Credit. From the occurrence and during the
continuance, of an Event of Default, such commission shall be increased to
an amount equal to 2% plus the Applicable Interest Margin for Revolving
Credit Loans which are Eurodollar Loans multiplied by the daily average
amount of the L/C Exposure; and
56
(iii) Promptly upon receipt by the Issuing Bank or the
Administrative Agent of any amount described in clause (ii) of this Section
2.21(f), or any amount described in Section 2.21(e) previously reimbursed to
the Issuing Bank by the Revolving Credit Lenders, the Issuing Bank or the
Administrative Agent (as applicable) shall distribute to each Revolving
Credit Lender its pro rata share of such amount based on its participation
in, or amount paid by such Revolving Credit Lender with respect to, the
applicable Letter(s) of Credit. Amounts payable under clauses (i)(A) and
(i)(B) of this Section 2.21(f) shall be paid directly to the Issuing Bank
and shall be for its exclusive use.
(g) If by reason of (i) any change in Applicable Law after the Initial
Date, or in the interpretation or administration thereof (including, without
limitation, any request, guideline or policy not having the force of law) by any
Governmental Authority charged with the administration or interpretation
thereof, or (ii) compliance by the Issuing Bank or any Revolving Credit Lender
with any direction, request or requirement (whether or not having the force of
law) issued after the Initial Date by any Governmental Authority or monetary
authority, including, without limitation, any change whether or not proposed or
published prior to the Initial Date and any modifications to Regulation D
occurring after the Initial Date:
(A) the Issuing Bank or any Revolving Credit Lender shall be
subject to any tax, levy, impost, duty, fee, charge, deduction or
withholding of any nature with respect to any Letter of Credit (other
than withholding tax imposed by the United States of America or any
other tax, levy, impost, duty, fee, charge, deduction or withholding
(1) that is measured with respect to the overall net income of the
Issuing Bank or such Revolving Credit Lender or of a Lending Office of
the Issuing Bank or such Revolving Credit Lender, and that is imposed
by the United States of America, or by the jurisdiction in which the
Issuing Bank or such Revolving Credit Lender is incorporated, or in
which such Lending Office is located, managed or controlled or in which
the Issuing Bank or such Revolving Credit Lender has its principal
office or a presence which is not otherwise connected with, or required
by, this transaction (or any political subdivision or taxing authority
thereof or therein) or (2) that is imposed solely by reason of the
Issuing Bank or such Revolving Credit Lender failing to make a
declaration of, or otherwise to establish, nonresidence or to make any
other claim for exemption, or otherwise to comply with any
certification, identification, information, documentation or reporting
requirements prescribed under the laws of the relevant jurisdiction, in
those cases where the Issuing Bank or such Revolving Credit Lender may
properly make the declaration or claim or so establish nonresidence or
otherwise comply), or to any variation thereof or to any penalty with
respect to the maintenance or fulfillment of its obligations under this
Section 2.21, whether directly or by such being imposed on or suffered
by the Issuing Bank or any Revolving Credit Lender;
57
(B) the basis of taxation of any fee or amount payable hereunder
with respect to any Letter of Credit or any participation therein shall
be changed;
(C) any reserve, deposit or similar requirement is or shall be
applicable, imposed or modified in respect of any Letter of Credit
issued by the Issuing Bank or participations therein purchased by any
Revolving Credit Lender; or
(D) there shall be imposed on the Issuing Bank or any Revolving
Credit Lender any other condition regarding this Section 2.21, any
Letter of Credit or any participation therein;
and the result of the foregoing is to directly or indirectly increase from the
conditions that exist on the Initial Date the cost to the Issuing Bank or any
Lender of issuing, making or maintaining any Letter of Credit or of purchasing
or maintaining any participation therein, or to reduce the amount receivable in
respect thereof by the Issuing Bank or any Lender, then and in any such case the
Issuing Bank or such Lender may, at any time, notify the Borrower, and the
Borrower shall pay on demand such amounts as the Issuing Bank or such Lender may
specify to be necessary to compensate the Issuing Bank or such Lender for such
additional cost or reduced receipt. Sections 2.16(b), (c) and (d) shall in all
instances apply to the Issuing Bank and any Lender with respect to the Letters
of Credit issued hereunder. The determination by the Issuing Bank or any Lender,
as the case may be, of any amount due pursuant to this Section 2.21 as set forth
in a certificate setting forth the calculation thereof in reasonable detail
shall, in the absence of manifest error, be final, conclusive and binding on all
of the parties hereto.
(h) If at any time when an Event of Default shall have occurred and be
continuing, any Letters of Credit shall remain outstanding, then the Issuing
Bank may, and if directed by the Required Revolving Credit Lenders shall,
require the Borrower to deliver to the Administrative Agent cash or Cash
Equivalents in an amount equal to 105% of the amount of the L/C Exposure or to
furnish other security acceptable to the Issuing Bank and the Required Revolving
Credit Lenders. Any amounts so delivered pursuant to the preceding sentence
shall be applied to reimburse the Issuing Bank for the amount of any drawings
honored under Letters of Credit and any costs associated with the Letters of
Credit; provided, however, that if prior to the Revolving Credit Commitment
Termination Date, (i) no Default or Event of Default is then continuing, then
the Administrative Agent shall return all of such collateral relating to such
deposit to the Borrower if requested by it or (ii) Letters of Credit shall
expire or be returned by the beneficiary so that the amount of the cash or Cash
Equivalents delivered to the Administrative Agent hereunder shall exceed 105% of
the then current L/C Exposure, then such excess shall first be applied to pay
any Obligations owing to the Revolving Credit Lenders under this Credit
Agreement and the remainder shall be returned to the Borrower.
(i) Notwithstanding the termination of the Revolving Credit Commitments
and the payment of the Revolving Credit Loans, the obligations of the Borrower
under this Section 2.21 shall remain in full force and effect until the
Administrative Agent, the Issuing Bank and the Revolving Credit Lenders shall
have been irrevocably released from their obligations with regard to any and all
Letters of Credit.
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(j) The obligations of the Borrower to reimburse the Issuing Bank and
the Revolving Credit Lenders for drawings made under any Letter of Credit shall
be unconditional and irrevocable and shall be paid strictly in accordance with
the terms of this Credit Agreement under all circumstances, including, without
limitation: (i) any lack of validity or enforceability of any Letter of Credit;
(ii) the existence of any claim, setoff, defense or other right which the
Borrower may have at any time against a beneficiary of any Letter of Credit or
against the Issuing Bank or any of the Revolving Credit Lenders, whether in
connection with this Credit Agreement, the transactions contemplated herein or
any unrelated transaction; (iii) payment by the Issuing Bank against any draft,
demand, certificate or other document presented under any Letter of Credit which
proves 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
Issuing Bank of any Letter of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the terms of such
Letter of Credit (including, without limitation, payment by the Issuing Bank in
accordance with its usual practices and procedures, subsequent to the expiry
date of a Letter of Credit, as long as the Issuing Bank has obtained the consent
of the Borrower thereto and has not been notified in writing by the
Administrative Agent or a Revolving Credit Lender of the occurrence of the
Revolving Credit Commitment Termination Date); (v) any other circumstance or
happening whatsoever, which is similar to any of the foregoing; or (vi) the fact
that any Event of Default shall have occurred and be continuing (it being
understood that any such payment by the Borrower shall be without prejudice to,
and shall not constitute a waiver of, any rights the Borrower might have or
might acquire against any party as a result of the payment by the Issuing Bank
of any draft or the reimbursement by the Borrower thereof).
3. REPRESENTATIONS AND WARRANTIES OF CREDIT PARTIES
In order to induce the Agents, the Issuing Bank and the
Lenders to enter into this Credit Agreement and to make Loans and to issue or
purchase participations in the Letters of Credit provided for herein, the Credit
Parties, jointly and severally, make the following representations and
warranties to, and agreements with, the Agents, the Issuing Bank and the
Lenders, all of which shall survive the execution and delivery of this Credit
Agreement, the issuance of any notes evidencing any of the Loans hereunder and
the making of the Loans and the issuance of the Letters of Credit:
SECTION 3.1 Existence and Power. (a) The Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of Pennsylvania and is qualified to do business and is in good standing in all
jurisdictions where either (i) the nature of its properties or business so
requires or (ii) the failure to be in good standing could reasonably be expected
to have a Material Adverse Effect. Schedule 3.1(a) hereto sets forth a list of
all jurisdictions in which the Borrower is so qualified.
59
(b) Each other Credit Party is duly organized, validly existing and in
good standing under the laws of its jurisdiction of organization and is
qualified to do business and is in good standing in all jurisdictions where
either (i) the nature of its properties or business so requires or (ii) the
failure to be in good standing could reasonably be expected to have a Material
Adverse Effect. Schedule 3.1(b) hereto also sets forth a list of the
jurisdiction of organization of each Credit Party and all jurisdictions in which
each Credit Party is qualified to do business.
(c) Each of the Credit Parties has the partnership, company or
corporate, as the case may be, power and authority (i) to own its respective
properties and carry on its respective business as now being, or as now intended
to be, conducted, (ii) to execute, deliver and perform, as applicable, its
obligations under the Fundamental Documents and any other documents contemplated
hereby or thereby to which it is or will be a party, and (iii) to grant to the
Collateral Agent, for the benefit of the Secured Parties, a security interest in
the Collateral and the Real Property Assets as contemplated by this Credit
Agreement and the other Fundamental Documents to which it is or will be a party;
and in the case of the Pledgors, to pledge to the Collateral Agent for the
benefit of the Secured Parties, the Pledged Collateral as contemplated by
Article 10 hereof; and in the case of the Borrower, to execute, deliver and
perform its obligations under this Credit Agreement and any notes evidencing any
of the Loans hereunder and to borrow hereunder; and in the case of the
Guarantors, to guaranty the Obligations as contemplated by Article 9 hereof.
SECTION 3.2 Authority and No Violation. The execution, delivery and
performance of this Credit Agreement and the other Fundamental Documents to
which it is a party, by each Credit Party, the grant to the Administrative Agent
for the benefit of the Secured Parties of the security interest in the
Collateral and the Real Property Assets as contemplated by this Credit Agreement
and the other Fundamental Documents to which it is or will be a party, by each
Credit Party, and the pledge to the Collateral Agent for the benefit of the
Secured Parties of the Pledged Collateral as contemplated by Article 10 hereof,
by each Pledgor and, in the case of the Borrower, the Borrowings hereunder and
the execution, delivery and performance of the notes evidencing any of the Loans
hereunder and, in the case of each Guarantor, the guaranty of the Obligations as
contemplated in Article 9 hereof, (i) have been duly authorized by all necessary
company, partnership or corporate (as applicable) action on the part of each
such Credit Party, (ii) will not constitute a violation of any provision of
Applicable Law or any order of any Governmental Authority applicable to such
Credit Party or any of its respective properties or assets, (iii) will not
violate any provision of the Certificate of Incorporation, By-Laws, partnership
agreement, limited liability company agreement, articles of organization or any
other organizational document of any Credit Party or any Subsidiary of a Credit
Party, or any provision of any Regulatory License, Reimbursement Approval,
Management Agreement, material indenture, agreement, bond, note, mortgage, deed
of trust, or other similar instrument to which such Credit Party is a party or
by which such Credit Party or any of its respective properties or assets are
bound or to which such Credit Party is subject, (iv) will not be in conflict
with, result in a breach of, or constitute (with due notice or lapse of time or
both) a default under, or create any right to terminate, any such Regulatory
License, Reimbursement Approval, Management Agreement, indenture, agreement,
bond, note, mortgage, deed of trust, or other instrument and (v) will not result
in the creation or imposition of (or the obligation to create or impose) any
Lien, charge or encumbrance of any nature whatsoever upon any of the properties
or assets of any of the Credit Parties or any Subsidiary of a Credit Party other
than pursuant to this Credit Agreement or the other Fundamental Documents.
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SECTION 3.3 Governmental Approval. (a) All authorizations, approvals,
orders, consents, licenses, registrations or filings from or with any
Governmental Authority (other than UCC financing statements and the Mortgages
all of which will be delivered to the Collateral Agent in accordance with the
terms of this Credit Agreement, in form suitable for recording or filing with
the appropriate filing office) required for the execution, delivery and
performance by any Credit Party) of this Credit Agreement and the other
Fundamental Documents to which it is a party, and the execution and delivery by
the Borrower of any notes evidencing any of the Loans hereunder, have been duly
obtained or made, and are in full force and effect, and if any further
authorizations, approvals, orders, consents, licenses, registrations or filings
should hereafter become necessary, the Credit Parties shall obtain or make all
such authorizations, approvals, orders, consents, licenses, registrations or
filings.
(b) Each Credit Party and each Subsidiary of a Credit Party has
obtained and holds in full force and effect all Regulatory Licenses, other
licenses, Reimbursement Approvals, authorizations, consents, franchises,
permits, certificates (including, without limitation, certificates of need)
accreditations, easements, rights of way and other approvals necessary to own
its respective property and assets and to carry on its respective business as
now being, or as now intended to be, conducted, other than those the absence of
which is not reasonably likely to have a Material Adverse Effect.
(c) As of the Closing Date, except as set forth on Schedule 3.3(c)
hereto, during the last twenty-four (24) months, no Credit Party nor any
Subsidiary of a Credit Party has been notified by JCAHO or any relevant
Governmental Authority or other Person with respect to any Regulatory License,
any Reimbursement Approval or other approval or authorization necessary to
operate its business as currently being conducted, of such Governmental
Authority's or other Person's actual revocation, suspension, termination,
rescission, or non-renewal, such Regulatory License, Reimbursement Approval or
other approval or authorization.
SECTION 3.4 Binding Agreements. Each Credit Party has duly executed and
delivered this Credit Agreement and each other Fundamental Document to which it
is a party. Each of this Credit Agreement and the other Fundamental Documents
constitutes the legal, valid and binding obligation of each Credit Party that is
a party thereto, enforceable against such Credit Party in accordance with its
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency and similar laws affecting creditors' rights generally
and to general principles of equity, whether such enforceability is considered
in a proceeding at law or in equity.
SECTION 3.5 No Material Adverse Effect. (a) Since June 30, 2001, there
has been no material adverse change with respect to the business, operations,
performance, assets, properties, condition (financial or otherwise) or prospects
of the Credit Parties taken as a whole.
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(b) No Credit Party has entered or is entering into the arrangements
contemplated hereby and by the other Fundamental Documents, or intends to make
any transfer or incur any obligations hereunder or thereunder, with actual
intent to hinder, delay or defraud either present or future creditors. On and as
of the Closing Date, on a Pro Forma Basis after giving effect to all
Indebtedness (including the Loans) expected to be in existence on the Closing
Date: (i) each Credit Party expects the cash available to such Credit Party,
after taking into account all other anticipated uses of the cash of such Credit
Party (including the payments on or in respect of debt referred to in clause
(iii) of this Section 3.5(b)), will be sufficient to satisfy all final judgments
for money damages which have been docketed against such Credit Party or which
may be rendered against such Credit Party in any action in which such Credit
Party is a defendant (taking into account the reasonably anticipated maximum
amount of any such judgment and the earliest time at which such judgment might
be entered); (ii) the sum of the present fair saleable value of the assets of
each Credit Party will exceed the probable liability of such Credit Party on its
debts (including its Guaranties); (iii) no Credit Party will have incurred or
intends to, or believes that it will, incur debts beyond its ability to pay such
debts as such debts mature (taking into account the timing and amounts of cash
to be received by such Credit Party from any source, and of amounts to be
payable on or in respect of debts of such Credit Party and the amounts referred
to in clause (i)); and (iv) each Credit Party believes it will have sufficient
capital with which to conduct its present and proposed business and the property
of such Credit Party does not constitute unreasonably small capital with which
to conduct its present or proposed business. For purposes of this Section
3.5(b), "debt" means any liability or a claim, and "claim" means any (y) right
to payment whether or not such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured, or (z) right to an equitable remedy for
breach of performance if such breach gives rise to a payment, whether or not
such right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or
unsecured.
SECTION 3.6 Financial Information. (i) The audited, consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries at September 30,
2000 and (ii) the unaudited, consolidated balance sheets of the Borrower and its
Consolidated Subsidiaries at June 30, 2001, together in each case with the
related statements of income, stockholders' equity and cash flows and the
related notes and supplemental information, in the forms which have previously
been delivered to the Lenders, have been prepared in accordance with GAAP
consistently applied, except as otherwise indicated in the notes to such
financial statements and subject in the case of unaudited statements, to changes
resulting from year-end and audit adjustments. All of such financial statements
fairly present, in accordance with GAAP, the consolidated financial position and
the results of operations, as the case may be, of the Borrower and its
Consolidated Subsidiaries, at the dates or for the periods indicated.
SECTION 3.7 Credit Parties and their Subsidiaries. (a) Annexed hereto
as Schedule 3.7(a) is a correct and complete list as of the Closing Date, of
each Credit Party and each Subsidiary of a Credit Party showing, as to each, (i)
its exact legal name, (ii) the jurisdiction in which it was incorporated or
otherwise organized, (iii) its type of organization, (iv) in the case of a
Credit Party, its taxpayer identification number and organizational
identification number if it has one, (v) in the case of a Credit Party which is
a corporation, its authorized capitalization, the number of shares of its
capital stock outstanding and the ownership of such capital stock, (vi) in the
case of a Credit Party which is a limited partnership, the general partners and
limited partners of such Credit Party and the ownership of its partnership
interests, (vii) in the case of a Credit Party which is a limited liability
company, the members of such Credit Party and the ownership of its limited
liability company interests and (viii) in the case of each Credit Party, the
location of its chief executive office and the location where it keeps the
records concerning the Collateral or any Real Property Asset or any item
included in the Collateral.
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(b) As of the Closing Date, no Credit Party owns any voting stock or
other beneficial interest, either directly or indirectly, in any Person other
than another Credit Party or as set forth on Schedule 3.7(b) hereto.
(c) As of the Closing Date, no Credit Party is a limited or general
partner in any joint venture or partnership, except as set forth on Schedule
3.7(c) hereto.
SECTION 3.8 Patents, Trademarks, Copyrights and Other Rights. (a) The
Credit Parties and their Subsidiaries possess all patents, patent rights and
licenses, trademarks, service marks, tradenames, trademark rights and licenses,
copyrights, copyright rights and licenses and any other similar rights, free
from burdensome restrictions, which are material to the conduct of their
respective businesses (collectively the "Proprietary Rights") and have duly
recorded their interest in the United States Patent and Trademark Office or the
United States Copyright Office as applicable. Schedule 3.8 lists all registered
Proprietary Rights, and all Proprietary Rights as to which an application for
registration has been made, owned and used or held for use by any Credit Party
or any Subsidiary of a Credit Party, specifying as to each, as applicable: (i)
the nature of such Proprietary Right; (ii) the Credit Party or Subsidiary
thereof which owns such Proprietary Right; (iii) the jurisdictions or government
offices by or in which such Proprietary Right has been issued or registered (or,
if applicable, in which an application for such issuance or registration has
been filed), including the respective registration or application numbers and
(iv) all licenses, sublicenses and other agreements to which a Credit Party or
Subsidiary thereof is a party and pursuant to which any Person is authorized to
use any Proprietary Right including, as to licenses to a Credit Party or
Subsidiary thereof, the identity of the licensor, and as to licenses granted by
a Credit Party or Subsidiary thereof, the identity of the licensee. To the best
of the Credit Parties' knowledge, a Credit Party or Subsidiary thereof is either
(1) the sole and exclusive owner (excluding licenses granted by a Credit Party
or Subsidiary thereof) of all right, title and interest in and to (free and
clear of any Lien) the Proprietary Rights described in Schedule 3.8 hereto and
has sole and exclusive rights to the use thereof or the material covered thereby
in connection with the services or products in respect of which they are being
used, or (2) the licensee of (free and clear of any Lien) the Proprietary Rights
described in Schedule 3.8 hereto and has the rights to the use thereof or
material covered thereby in connection with the services or products in respect
of which they are being used.
(b) Except as set forth on Schedule 3.8 hereto, (i) there is no claim,
suit, action or proceeding pending, or to the Credit Parties' knowledge,
threatened, against a Credit Party or Subsidiary thereof that involves a claim
of infringement of any Proprietary Right and (ii) no Credit Party has any
knowledge of any existing infringement by any other Person of any of the
Proprietary Rights which in either case would have a Material Adverse Effect.
SECTION 3.9 Fictitious Names. Except as disclosed on Schedule 3.9
hereto, none of the Credit Parties has done business, is doing business or
intends to do business other than under its full corporate, partnership or
company name (as applicable), including, without limitation, under any trade
name or other doing business name; provided, that if any of the Credit Parties
intends to do business other than under its full corporate, partnership or
company name (as applicable), including, without limitation, under any trade
name or other doing business name, it shall have provided the Administrative
Agent and the Collateral Agent with reasonable prior written notice of its
intention to do so.
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SECTION 3.10 Title to Properties. (a) Except as set forth on Schedule
3.10(a) hereto, the Credit Parties and their Subsidiaries have good title to
(and with respect to Real Property Assets, good and marketable title to, or
valid leasehold interests in) each of the properties and assets reflected on the
financial statements referred to in Section 3.6 hereof, including, without
limitation, the Real Property Assets listed on Schedules 3.24(a) and 3.24(b)
hereto (other than such properties or assets disposed of in the ordinary course
of business since the date of such financial statements or as permitted
hereunder) and all such properties and assets are free and clear of Liens,
except Permitted Liens.
(b) Each of the Credit Parties and each Subsidiary of a Credit Party
has complied in all material respects with all leases to which it is a party,
and is aware of no defaults under any such lease or any conditions which with
the passage of time or delivery of notice would constitute a default thereunder
and all such leases are in full force and effect. Each of the Credit Parties and
each Subsidiary of a Credit Party which is a lessee under any lease, enjoys
peaceful and undisturbed possession of the Real Property Assets leased pursuant
to such lease, subject to Permitted Liens.
(c) No Credit Party or any Subsidiary of a Credit Party has received
any notice of, nor has any knowledge of, any pending or contemplated
condemnation proceeding affecting any Real Property Asset or any sale or
disposition thereof in lieu of condemnation.
(d) No Credit Party or any Subsidiary of a Credit Party is obligated
under any right of first refusal, option or other contractual right to sell,
assign or otherwise dispose of any Real Property Asset or any interest therein
except for such rights of first refusal, options or other contractual rights
described on Schedule 3.10(d) hereto.
SECTION 3.11 Special Representations Relating to Receivables. With
respect to each Receivable, (i) it is genuine and in all respects what it
purports to be, and it is not evidenced by a judgment; (ii) it arose out of a
completed rendition of services by a Credit Party in the ordinary course of its
business and in accordance with the terms and conditions of all contracts or
other documents relating thereto and forming a part of the contract between such
Credit Party and the account debtor; (iii) to the knowledge of the applicable
Credit Party, the account debtor thereunder had the capacity to contract at the
time any contract or other document giving rise to the Receivable was executed,
and is solvent (except for Receivables on which the account debtor is Mariner
Post-Acute Network, Inc. or an affiliate thereof); (iv) to the knowledge of the
applicable Credit Party, there are no proceedings or actions which are
threatened or pending against the account debtor thereunder which could
reasonably be expected to result in any material adverse change in such account
debtor's financial condition or the collectibility of such Receivable; (v) the
Receivable is for a liquidated amount maturing as stated in the Credit Parties'
records which are available to the Administrative Agent and the Collateral
Monitoring Agent; (vi) the Receivable is not subject to any offset, Lien,
deduction, defense, dispute, counterclaim or any other adverse condition except
for discounts and allowances made in the ordinary course of business and
consistent with the Credit and Collection Policy, and each Receivable is
absolutely owing to such Credit Party and was not contingent in any respect or
for any reason, and there are not facts, events or occurrences which in any way
impair the validity or enforceability thereof or tend to reduce the amount
payable thereunder from the face amount of the invoice and statements with
respect thereto; and (vii) the Credit Party has made no agreement with any
account debtor for any deduction therefrom, except discounts or allowances which
are granted by such Credit Party in the ordinary course of its business for the
prompt payment and which are reflected in the calculation of the net amount of
the invoice related thereto.
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SECTION 3.12 Litigation; Judgments. (a) Except as set forth on Schedule
3.12(a) hereto, there are no actions, suits or other proceedings at law or in
equity by or before any arbitrator or arbitration panel, or any Governmental
Authority (including, but not limited to, matters relating to environmental
liability) or any investigation by any Governmental Authority of the affairs of,
or to the best of each Credit Party's knowledge, threatened action, suit or
other proceeding against or affecting, any Credit Party, any Subsidiary of a
Credit Party or of any of their respective properties or rights which either (A)
if adversely determined, could reasonably be expected to have a Material Adverse
Effect, or (B) relate to this Credit Agreement, any Fundamental Document or any
of the transactions contemplated hereby or thereby or the Loans hereunder. No
Credit Party and no Subsidiary of a Credit Party is in default with respect to
any order, writ, injunction, decree, rule or regulation of any Governmental
Authority binding upon such Person, which default could reasonably be expected
to have a Material Adverse Effect.
(b) There are no unpaid final, nonappealable judgments or decrees in an
aggregate amount of $5,000,000 or more entered by a court or courts of competent
jurisdiction against any Credit Party or any Subsidiary of a Credit Party (other
than any judgment as to which, and only to the extent, a reputable insurance
company has acknowledged coverage of such claim in writing).
(c) Except as set forth on Schedule 3.12(c) hereto or as otherwise
disclosed pursuant to Section 5.4(b) with respect to matters arising after the
date hereof, to the knowledge of the Borrower, there is no pending investigation
of the Credit Parties by JCAHO, which investigation is not otherwise conducted
in the ordinary course of business and no criminal, civil or administrative
action, audit, or investigation by a fiscal intermediary or by the federal
government or any state government exists or is threatened with respect to the
Credit Parties which could reasonably be expected to adversely affect the Credit
Parties' right to receive a material portion of Medicare and Medicaid
reimbursement to which it would otherwise be entitled, right to participate in
the Medicare and Medicaid programs, or otherwise have a Material Adverse Effect
on the receipt of Medicare and Medicaid reimbursement by the Credit Parties, and
except as set forth on Schedule 3.12(c) hereto, to the knowledge of the
Borrower, none of the Credit Parties is subject to any pending but unassessed
Medicare or Medicaid claim payment adjustments, except to the extent the
Borrower has established adequate reserves for such adjustments in accordance
with GAAP.
SECTION 3.13 Federal Reserve Regulations. No Credit Party nor any
Subsidiary of a Credit Party is engaged principally or as one of its important
activities, in the business of extending credit for the purpose of purchasing or
carrying any Margin Stock. No part of the proceeds of the Loans will be used,
directly or indirectly, whether immediately, incidentally or ultimately (i) to
purchase or carry any Margin Stock or to extend credit to others for the purpose
of purchasing or carrying any Margin Stock, or (ii) for any other purpose, in
each case, violative of or inconsistent with any of the provisions of any
regulation of the Board, including, without limitation, Regulations T, U and X
thereto.
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SECTION 3.14 Investment Company Act. No Credit Party nor any Subsidiary
of a Credit Party is, or will during the term of this Credit Agreement be, (i)
an "investment company" or a company "controlled" by an "investment company",
within the meaning of the Investment Company Act of 1940, as amended, or (ii)
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act or any foreign, federal or local statute or any other
Applicable Law of the United States of America or any other jurisdiction, in
each case limiting its ability to incur indebtedness for money borrowed as
contemplated hereby or by any other Fundamental Document.
SECTION 3.15 Taxes. Except as set forth on Schedule 3.15 hereto, each
Credit Party and each Subsidiary of a Credit Party has filed or caused to be
filed all United States federal tax returns, state income tax returns and other
material tax returns which are required to be filed with any Governmental
Authority after giving effect to applicable extensions, and has paid or has
caused to be paid all taxes as shown on said returns or on any assessment
received by them, to the extent that such taxes have become due, except as
permitted by Section 5.8 hereof. No Credit Party knows of any material
additional assessments or any basis therefor. In the reasonable, good faith
opinion of the Credit Parties, the charges, accruals and reserves on the books
of the Credit Parties and their Subsidiaries in respect of taxes or other
governmental charges are adequate.
SECTION 3.16 Compliance with ERISA. (a) Each Plan has been maintained
and operated in all material respects in accordance with all Applicable Laws,
including ERISA and the Code except to the extent that any failure thereof could
not reasonably be expected to result in a material liability. Each Plan intended
to qualify under Section 401(a) of the Code so qualifies except to the extent
that any failure to so qualify could not reasonably be expected to result in a
material liability. No Reportable Event has occurred since the effective date of
the Plan of Reorganization. No Plan has an "accumulated funding deficiency,"
within the meaning of Section 412 of the Code or Section 302 of ERISA, or has
applied for or received a waiver of the minimum funding standards or an
extension of any amortization period, within the meaning of Section 412 of the
Code or Section 303 or 304 of ERISA. No material liability has been, and no
circumstances exist pursuant to which any such material liability could
reasonably likely be, imposed upon any Credit Party or ERISA Affiliate (i) under
Sections 4971 through 4980B of the Code, Section 409, 502(i), 502(l) or 515 of
ERISA, or under Title IV of ERISA with respect to any Plan or Multiemployer
Plan, or with respect to any plan heretofore maintained by any Credit Party or
ERISA Affiliate, or any entity that heretofore was an ERISA Affiliate, or (ii)
for the failure to fulfill any obligation to contribute to any Multiemployer
Plan. Neither any Credit Party nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization or has been
terminated within the meaning of Title IV of ERISA, no Multiemployer Plan is
reasonably expected to be in reorganization or to be terminated and, using
actuarial assumptions and computation methods consistent with Part 1 of Subtitle
E of Title IV of ERISA, the aggregate liabilities of the Credit Parties and
their ERISA Affiliates to all Multiemployer Plans in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
such Plan then ended would not exceed $1,000,000.
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(b) Assuming none of the Lenders is using assets of any employee
benefit plan subject to Title I of ERISA or any "plan" (within the meaning of
Section 4975(e) of the Code) maintained by the Borrower or any of its ERISA
Affiliates to make the Loans, the execution, delivery and performance of the
Fundamental Documents and the consummation of the transactions contemplated
hereby and thereby will not involve any "prohibited transaction" within the
meaning of Section 406 of ERISA or Section 4975 of the Code.
SECTION 3.17 Agreements. (a) No Credit Party nor any Subsidiary of a
Credit Party is in default in the performance, observance or fulfillment of any
of the obligations, covenants or conditions contained in any agreement or
instrument to which it is a party (including, without limitation, any Regulatory
License, any Reimbursement Approval, any Management Agreement or the Rollover
Note Indenture) or by which it or any of its property or assets is bound in any
respect which default could reasonably be expected to result in a Material
Adverse Effect.
(b) Schedule 3.17(b) hereto is a true and complete listing as of the
Closing Date of (i) all material credit agreements, indentures, and other
agreements related to any Indebtedness of any Credit Party or any Subsidiary of
a Credit Party, other than the Fundamental Documents, (ii) all material joint
venture agreements to which any Credit Party or any Subsidiary of a Credit Party
is a party, (iii) all material leases with respect to any Real Property Asset,
(iv) all material agreements or other arrangements pursuant to which a Credit
Party or any Subsidiary of a Credit Party has granted a Lien to any Person, (v)
all other contractual arrangements entered into by a Credit Party or any
Subsidiary of a Credit Party or by which any Credit Party, any Subsidiary of a
Credit Party or any of its property or assets is bound which arrangements are
material to any Credit Party or any Subsidiary of a Credit Party, including but
not limited to, Guaranties, (vi) all material Regulatory Licenses and material
Reimbursement Approvals and (vii) all material Management Agreements. For
purposes of this Section 3.17, a contract or agreement shall be deemed
"material" if the Credit Parties or a Subsidiary thereof reasonably expect that
any Credit Party or a Subsidiary thereof would, pursuant to the terms thereof,
(A) recognize future revenues in excess of $20,000,000 per annum, (B) incur
liabilities or obligations in excess of $20,000,000 per annum or (C) likely
suffer damages or losses in excess of $20,000,000 by reason of the breach or
termination thereof.
SECTION 3.18 Security Interest. (a) This Credit Agreement and the other
Fundamental Documents (other than the Mortgages), when executed and delivered,
will create and grant to the Collateral Agent for the benefit of the Secured
Parties (upon (i) the filing of the appropriate UCC-1 financing statements with
the filing offices listed on Schedule 3.18(a) hereto and (ii) the possession of
the certificates evidencing Pledged Securities and Collateral of the type
specified in Section 9-313 of the UCC) a valid and first priority perfected
security interest in the Collateral, subject only to Permitted Liens.
(b) The Mortgages, when executed and delivered, will create in favor of
the Administrative Agent, for the benefit of the Secured Parties, a legal, valid
and enforceable first priority Lien on all of the Credit Parties' respective
right, title and interest in and to all the Real Property Assets (except
personalty that does not constitute fixtures) and the proceeds thereof, and when
the Mortgages are filed in the offices specified on Schedule 3.18(b) hereto, the
proper amount of mortgage recording or similar taxes (if any) are paid and when
the UCC-1 financing statements relating to fixtures are duly filed with the
filing offices listed on Schedule 3.18(b) hereto, the Mortgages shall constitute
fully perfected first priority Liens on, and fully perfected first priority
security interests in, all right, title and interest of the Credit Parties' in
all the Real Property Assets (except personalty that does not constitute
fixtures) and the proceeds thereof, in each case subject only to Permitted
Liens.
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SECTION 3.19 Disclosure. Neither this Credit Agreement nor any other
Fundamental Document nor any agreement, document, certificate or statement
furnished to any of the Agents, the Issuing Bank or any Lender by or on behalf
of any Credit Party in connection with the transactions contemplated hereby, at
the time it was furnished or delivered, contained any untrue statement of a
material fact regarding the Credit Parties or their Subsidiaries or, when taken
together with all such other agreements, documents, certificates and statements,
omitted to state a material fact necessary under the circumstances under which
it was made in order to make the statements contained herein or therein not
misleading. There is no fact known to any Credit Party (other than general
industry conditions or facts which have been disclosed to the Agents, the
Issuing Bank and the Lenders in writing) which has a Material Adverse Effect, or
could reasonably be expected in the future to have a Material Adverse Effect.
SECTION 3.20 Environmental Matters. (a) Except as set forth on Schedule
3.20 hereto, there are no past, pending, or, to the knowledge of the Borrower,
threatened Environmental Claims against, affecting or with respect to any Credit
Party or any Subsidiary of any Credit Party or any Premises, and no Credit Party
nor any Subsidiary of any Credit Party is aware of any facts or circumstances
which could reasonably be expected to form the basis for any such Environmental
Claim, except to the extent that any such Environmental Claims, individually or
in the aggregate, would not have a Material Adverse Effect;
(b) No Premises is currently or was formerly used for the handling,
storage, treatment, disposal, manufacture, processing or generation of Hazardous
Materials, except to the extent that any such activity, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect on
any Credit Party or any Subsidiary of any Credit Party;
(c) Each Credit Party, each Subsidiary of any Credit Party and any
tenants, operators or occupants of any Premises have obtained and hold all
required material Environmental Permits, except to the extent that any failure
to obtain or hold any such Environmental Permit, individually or in the
aggregate, would not have a Material Adverse Effect;
(d) Each Credit Party and each Subsidiary of each Credit Party is in
compliance with all terms, conditions and provisions of all applicable (1)
Environmental Permits, and (2) Environmental Laws, except to the extent that any
such non-compliance, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect;
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(e) No Releases of Hazardous Materials have occurred at, from, in, to,
on, or under any Premises, and no Hazardous Materials are present in, on, about
or migrating to or from any Premises, except to the extent that any such
Releases or presence of Hazardous Materials, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect;
(f) Neither any Credit Party nor any Subsidiary of any Credit Party,
nor any predecessor of any Credit Party or Subsidiary of any Credit Party, nor
any entity previously owned by any Credit Party or Subsidiary of any Credit
Party, has transported or arranged for the treatment, storage, handling,
disposal, or transportation of any Hazardous Material to any location (other
than any Premises) which could result in an Environmental Claim against any
Credit Party or any Subsidiary of any Credit Party, except to the extent that
any such activity, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect;
(g) No Premises is a current, or to the knowledge of any Credit Party
or any Subsidiary of any Credit Party, a proposed Environmental Clean-up Site,
except to the extent as would not reasonably be expected to have a Material
Adverse Effect;
(h) There are no (i) underground storage tanks (active or abandoned),
(ii) polychlorinated biphenyl containing equipment, (iii) asbestos-containing
material at any Premises, or (iv) lead-based paint located at any Premises,
except to the extent that the presence of any of the foregoing, individually or
in the aggregate, would not reasonably be expected to have a Material Adverse
Effect; and
(i) There have been no material environmental investigations, studies,
audits, tests, reviews or other analyses conducted by, or on behalf of, and
which are in the possession of any Credit Party or any Subsidiary of any Credit
Party with respect to any Premises which have not been delivered to the Agents
except for such investigations, studies, audits, tests, reviews or analyses
which do not individually or in the aggregate reveal environmental conditions
that could have a Material Adverse Effect.
SECTION 3.21 Pledged Securities. (a) Annexed hereto as Schedule 3.21(a)
under the heading "Pledged Capital Stock and Other Pledged Equity Interests" is
a correct and complete list as of the Closing Date, of all the Pledged
Securities hereunder showing, as to each, the entity whose stock or other equity
interests are being pledged, the Pledgor of such stock or other equity
interests, the stock certificate number (if applicable) and the number of shares
or amount of the capital stock or other equity interests being pledged
hereunder. Also set forth on Schedule 3.21(a) under the heading "Non-Pledged
Capital Stock" is a list of the Subsidiaries directly or indirectly owned or
controlled by a Credit Party whose Capital Stock will not be pledged hereunder.
Each Pledgor (i) is the legal and beneficial owner of, and has sole right, title
and interest to, the Pledged Securities owned by such Pledgor, free and clear of
all Liens, security interests or other encumbrances whatsoever, except the
security interests created by this Credit Agreement and the other Fundamental
Documents and (ii) has sole right and power to pledge, and grant the security
interest in, and Lien upon, such Pledged Securities pursuant to this Credit
Agreement without the consent of any Person or Governmental Authority
whatsoever.
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(b) All of the Pledged Securities are duly authorized, validly issued,
fully paid and non-assessable.
(c) There are no restrictions on the transfer of any of the Pledged
Securities which limit the ability of a Pledgor to pledge such securities or
interests (as applicable) to the Collateral Agent (for the benefit of the
Secured Parties). Except as set forth on Schedule 3.21(c) hereto and for
restrictions created herein or under applicable securities laws and the
regulations promulgated thereunder, there are no restrictions on the transfer of
any of the Pledged Securities by the Collateral Agent upon the occurrence of an
Event of Default.
(d) There are no warrants, options, conversion or similar stock
purchase rights currently outstanding with respect to, and no agreements to
purchase or otherwise acquire, any shares of the Capital Stock or other equity
interests of any issuer of any of the Pledged Securities.
(e) There are no securities or obligations of any kind convertible into
any shares of the Capital Stock or other equity interests of any issuer of any
of the Pledged Securities; and
(f) Article 10 of this Credit Agreement is effective to create a valid,
binding and enforceable security interest in, and Lien upon, all right, title
and interest of the Pledgors in the Pledged Collateral and upon the delivery of
the Pledged Securities to the Collateral Agent, such security interest and Lien
constitute a fully perfected first and prior security interest and Lien upon all
right, title and interest of the Pledgors in the Pledged Collateral.
SECTION 3.22 Compliance with Laws; Third Party Payor Arrangements. (a)
No Credit Party, Subsidiary of a Credit Party or any Real Property Asset is in
violation of any Applicable Law (including, without limitation, any
Environmental Law or health care law) or any restrictions of record or
agreements affecting any Real Property Asset, except for such violations which
in the aggregate are not reasonably likely to have a Material Adverse Effect.
(b) No Credit Party, Subsidiary of a Credit Party or any Real Property
Asset is in violation of any zoning or building law, ordinance, rule, regulation
or restriction affecting a Real Property Asset or any building permit,
including, without limitation, any certificate of occupancy, where such
violation could reasonably be expected to result in a Material Adverse Effect.
(c) The Borrowings hereunder, the intended use of the proceeds of the
Loans as contemplated by Sections 2.1(b), 2.2(b) and 2.3(b) hereof, the issuance
of the Letters of Credit hereunder and the performance of the Fundamental
Documents will not violate any Applicable Law.
(d) Each Credit Party has caused to be accurately prepared and filed
(or obtained extensions for) all applicable cost reports with respect to all
Third Party Payor Arrangements.
(e) Each Credit Party participates in an internal comprehensive
compliance program with respect to Applicable Laws relating to the health care
industry.
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SECTION 3.23 Projected Financial Information. The Borrower has
delivered to the Agents certain projections relating to the Borrower consisting
of balance sheets, income statements and cash flows, together with a statement
of the underlying assumptions. Such projected statements are based on good faith
estimates and assumptions believed to be reasonable at the time made, it being
recognized by the 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.
SECTION 3.24 Real Property. (a) Schedule 3.24(a) is a true and complete
list as of the Closing Date of (i) the facility number and street address of
each Real Property Asset owned by a Credit Party or a Subsidiary of a Credit
Party, (ii) the Credit Party or Subsidiary which owns each such Real Property
Asset, (iii) the appraised value of each such Real Property Asset, if available,
and the date of the applicable appraisal, (iv) the facility type of each such
Real Property Asset, (v) the lease(s) to which each such Real Property Asset is
subject and (vi) the name and address of the lessee of each such Real Property
Asset. The applicable Credit Party has a fee simple title to each Real Property
Asset listed on Schedule 3.24(a) hereto.
(b) Schedule 3.24(b) is a true and complete list as of the Closing Date
of (i) the facility number and street address of each Real Property Asset leased
by a Credit Party or a Subsidiary of a Credit Party, (ii) the Credit Party or
Subsidiary which leases each such Real Property Asset, (iii) the facility type
of such Real Property Asset, (iii) the name and address of the owner/lessor of
each such Real Property Asset, (iv) the leases to which each such Real Property
Asset is subject and (v) the name and address of any sublessee of each such Real
Property Asset.
(c) As of the Closing Date, each of the Real Property Assets listed on
either Schedule 3.24(a) or Schedule 3.24(b) hereto are leased by a Credit Party
to the party listed opposite such Real Property Asset under the column entitled
"Lessee" in the case of a Real Property Asset listed on Schedule 3.24(a) hereto
or "Sublessee" in the case of a Real Property Asset listed on Schedule 3.24(b)
hereto.
SECTION 3.25 No Default. No Default or Event of Default exists under or
with respect to any Fundamental Document.
SECTION 3.26 Labor Matters. Except as set forth on Schedule 3.26
hereto, there are no collective bargaining agreements or Multiemployer Plans
covering the employees of any Credit Party or any Subsidiary of a Credit Party
and no Credit Party nor any Subsidiary of a Credit Party has suffered any
strikes, walkouts or work stoppages within the last three (3) years.
SECTION 3.27 Organizational Documents. The documents delivered pursuant
to Section 4.1(b) constitute, as of the Closing Date, all of the organizational
documents (together with all amendments and modifications thereof) of the Credit
Parties as of the Closing Date. The Credit Parties represent that they have
delivered to the Administrative Agent true, correct and complete copies of each
of the documents set forth in Section 4.1(b).
SECTION 3.28 Bank Accounts. Listed on Schedule 3.28 hereto are all bank
accounts maintained as of the Closing Date by a Credit Party or a Subsidiary of
a Credit Party.
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4. CONDITIONS TO THE EFFECTIVENESS OF THIS CREDIT AGREEMENT AND THE MAKING
OF THE LOANS
SECTION 4.1 Conditions Precedent to the Effectiveness of This Credit
Agreement and the Making of the Loans. The effectiveness of this Credit
Agreement and the making of the Loans is subject to the satisfaction in full or
waiver of the following conditions precedent:
(a) The Credit Agreement. The Administrative Agent shall have received
executed counterparts of this Credit Agreement, which, when taken together, bear
the signatures of the Agents, the Issuing Bank, all of the Credit Parties and
all of the Lenders;
(b) Supporting Documents of the Credit Parties. The Administrative
Agent shall have received in form and substance satisfactory to it, the
Collateral Agent and their counsel:
(i) a copy of the Certificate of Incorporation of the Borrower,
certified as of a recent date by the Secretary of State (or other
appropriate governmental official) of Pennsylvania;
(ii) a certificate of the Secretary of the Borrower, dated the
Closing Date and certifying (A) that attached thereto is a true and complete
copy of the certificate of incorporation and by-laws of the Borrower as in
effect on the date of such certification; (B) that the certificate of
incorporation of the Borrower has not been amended since the date of the
last amendment thereto indicated on the certificate of the Secretary of
State (or other governmental official) furnished pursuant to clause (i)
above, except to the extent specified in such Secretary's Certificate; (C)
that attached thereto is a true and complete copy of resolutions adopted by
the Borrower's Board of Directors authorizing the Borrowings by the
Borrower, the grant by the Borrower of the security interests contemplated
by the Fundamental Documents and the execution, delivery and performance by
the Borrower in accordance with its respective terms of this Credit
Agreement, the other Fundamental Documents to which it is or will be a party
and any other documents required or contemplated hereunder or thereunder and
that such resolutions have not been amended, rescinded or supplemented and
are currently in effect; and (D) as to the incumbency and specimen signature
of each officer of the Borrower executing this Credit Agreement, any notes
(on behalf of the Borrower), the other Fundamental Documents or any other
document delivered in connection herewith or therewith on behalf of the
Borrower (such certificate to contain a certification by another officer of
the Borrower as to the incumbency and signature of the officer signing the
certificate referred to in this clause (ii));
(iii) a certificate of the Secretary of each other Credit Party,
dated the Closing Date (which certificate may be an omnibus certificate
executed by the same individual on behalf of multiple Credit Parties), and
certifying (A) such Credit Party is in good standing in its jurisdiction of
organization and has paid all its franchise and other similar taxes except
where such failure to be in good standing would not have a Material Adverse
Effect; (B) that attached thereto is a true and complete copy of resolutions
or other authorizing documents adopted by the appropriate Person or Persons
of such Credit Party authorizing the Guaranty hereunder by such Credit
Party, the grant by such Credit Party of the security interests contemplated
by the Fundamental Documents and the execution, delivery and performance by
such Credit Party in accordance with its respective terms of this Credit
Agreement, the other Fundamental Documents to which it is or will be a party
and any other documents required or contemplated hereunder or thereunder and
that such resolutions have not been amended, rescinded or supplemented and
are currently in effect and (C) as to the incumbency and specimen signature
of each officer of such Credit Party executing this Credit Agreement, any
other Fundamental Documents or any other document delivered in connection
herewith or therewith on behalf of such Credit Party (such certificate to
contain a certification by another officer of such Credit Party as to the
incumbency and signature of the officer signing the certificate referred to
in this clause (iii)); and
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(iv) a certificate dated as of a recent date as to the good
standing and/or authority to do business of the Borrower and the Credit
Parties listed on Schedule 4.1(b)(iv) issued by the Secretary of State or
other appropriate governmental official of each jurisdiction for each such
entity.
(v) such additional documents relating to the Borrower and any
other Credit Party as the Administrative Agent or its counsel or any Lender
may reasonably request;
(c) Opinions of Counsel. The Administrative Agent shall have received
the written opinions of Weil, Gotshal & Manges LLP, counsel to the Credit
Parties and of local counsel in each of the states listed on Schedule 4.1(c)
hereto, each dated the Closing Date and addressed to the Agents, the Issuing
Bank, the Lenders and the other Secured Parties with respect to such matters
relating to this Credit Agreement and the Fundamental Documents as may be
requested by the Administrative Agent and its counsel, which opinion shall be in
form and substance satisfactory to the Administrative Agent and its counsel;
(d) No Material Adverse Effect. No Material Adverse Effect shall have
occurred since June 30, 2001;
(e) Material Agreements. The Administrative Agent or its counsel shall
have received a copy, certified by the Borrower, of each agreement listed on
Schedule 3.17(b) hereto;
(f) Financing Statements/Possession of Collateral. The Collateral Agent
shall have (i) received for filing all appropriate UCC financing statements to
perfect its security interest in the Collateral and evidence satisfactory to the
Collateral Agent that such UCC financing statements will be filed on or promptly
after the Closing Date, together with any related filing fees or similar charges
or taxes payable in connection with such filing; (ii) received the Pledged
Securities (to the extent such Pledged Securities are represented by a
certificate or other instrument) with appropriate undated stock powers or other
appropriate documents executed in blank and (iii) received delivery of all
Collateral of the type specified in Section 9-313 of the UCC;
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(g) Mortgages. The Collateral Agent shall have received a duly executed
Mortgage and appropriate UCC-1 Financing Statements with respect to each Real
Property Asset;
(h) Title Report. The Collateral Agent shall have received a recent
report by a Title Company as to the state of title of each Real Property Asset,
showing all Liens and encumbrances of record;
(i) Zoning Laws, etc. The Collateral Agent shall be satisfied with the
Credit Parties' compliance with all zoning, environmental and other laws,
ordinances, rules and regulations affecting or relating to each Real Property
Asset;
(j) Leases. The Administrative Agent or the Collateral Agent or their
counsel shall have received certified true and complete copies of all material
leases encumbering the Real Property Assets, together with executed and
acknowledged subordination, non-disturbance and attornment agreements and
estoppel certificates with respect thereto as may be required by the Collateral
Agent, in form and substance satisfactory to the Collateral Agent;
(k) Evidence of Title. The Collateral Agent shall be satisfied that
each Credit Party has sufficient right, title and interest in and to the
Collateral, the Real Property Assets and other assets which it purports to own,
as set forth in the documents and other materials presented to the Agents to
enable such Credit Party to grant to the Collateral Agent for the benefit of the
Secured Parties the security interests contemplated by the Fundamental
Documents, and that all financing statements, mortgages and other filings under
Applicable Law necessary to provide the Collateral Agent for the benefit of the
Secured Parties with a first priority perfected security interest in the Pledged
Securities, the Collateral and all Real Property Assets (subject in the case of
the Collateral and the Real Property Assets, to Permitted Liens) have been filed
and all taxes, recording or other fees relating thereto have been paid, or, have
been delivered to the Collateral Agent in satisfactory form for filing;
(l) Insurance. The Administrative Agent and the Collateral Agent shall
have received (i) a summary of all existing insurance coverage maintained by the
Credit Parties and their Subsidiaries which summary shall include for each
insurance policy, the policy number, the type of coverage, the policy limits and
deductibles, the insurer and the expiration date and (ii) evidence acceptable to
the Administrative Agent and the Collateral Agent that the insurance policies
required by Section 5.5 have been obtained and are in full force and effect,
including Certificates of Insurance with respect to all existing insurance
coverage maintained by the Credit Parties and/or their Subsidiaries which is set
forth on the summary delivered pursuant to clause (i) above, which certificates
shall comply with the requirements set forth in Section 5.5 hereof;
(m) Payment of the Fees. The Agents and the Co-Lead Arrangers (for
their benefit and the benefit of the Lenders) shall have received all Fees due
and payable on or before the Closing Date pursuant to the Fee Letters or this
Credit Agreement;
(n) Notes. For each Lender that has requested that the Loans made by it
be evidenced by a promissory note, the Administrative Agent shall have received
one or more promissory notes each duly executed on behalf of the Borrower, dated
the date hereof and payable to the order of such Lender in the principal amount
equal to such Lender's B Term Loans, Delayed Draw Term Loan or Delayed Draw Term
Loan Commitment (if Delayed Draw Term Loans are not drawn on the Closing Date)
and/or Revolving Credit Commitment, as applicable;
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(o) Payment of Other Fees and Expenses. All out-of-pocket expenses
incurred by the Administrative Agent, the Co-Lead Arrangers and the Issuing Bank
in connection with this Credit Agreement and the transactions contemplated
hereby, including, without limitation, all statements presented for reasonable
fees and disbursements of any financial, accounting or valuation advisors or
special counsel retained by the Agents (including, but not limited to, Morgan,
Lewis & Bockius LLP, counsel to the Agents), shall have been paid by the
Borrower;
(p) Litigation. No litigation, inquiry, injunction or restraining order
shall be pending, entered or threatened which involves this Credit Agreement or
any of the other Fundamental Documents or which could reasonably be expected to
have a Material Adverse Effect;
(q) Required Consents and Approvals. The Administrative Agent and the
Co-Lead Arrangers shall be satisfied that all required consents and approvals
have been obtained with respect to the transactions contemplated hereby from all
Governmental Authorities with jurisdiction over the business and activities of
any Credit Party and from any other entity whose consent, waiver or approval is
required pursuant to the terms of existing contracts to which any of the Credit
Parties is bound and which the Administrative Agent and the Co-Lead Arrangers in
their discretion deem necessary to the transactions contemplated hereby;
(r) Compliance with Laws. The Lenders shall be satisfied that the
transactions contemplated hereby will not violate any provision of Applicable
Law, or any order of any court or other agency of the United States or any state
thereof applicable to any of the Credit Parties or any of their respective
properties or assets;
(s) Representations and Warranties; No Default. The representations and
warranties set forth in Article 3 hereof and in any other Fundamental Documents
then in existence shall be true and correct in all material respects, and no
Default or Event of Default shall have occurred and be continuing hereunder;
(t) Closing Certificate. The Administrative Agent shall have received a
closing certificate signed by an Authorized Officer of the Borrower,
substantially in the form of Exhibit F hereto;
(u) Approval of Counsel to the Agents. All legal matters incident to
this Credit Agreement, the Fundamental Documents and the transactions
contemplated hereby and thereby shall be reasonably satisfactory to Morgan,
Lewis & Bockius LLP, counsel to the Agents and the Co-Lead Arrangers;
(v) Other Documents. The Agents and their counsel shall have received
fully executed originals of the Intercreditor Agreement, the Contribution
Agreement and such other documentation as the Agents or their counsel may
request;
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(w) Consolidated EBITDA. Consolidated EBITDA through the end of the
Rolling Four Quarter period ended June 30, 2001 shall be at least $208.0
million;
(x) Total Leverage Ratio. The Total Leverage Ratio (after giving effect
to any Loans to be made on the Closing Date and all Indebtedness to be
outstanding upon the effectiveness of the Plan of Reorganization) shall not
exceed 3.0:1.0;
(y) Final Order. A Final Order approving the Plan of Reorganization and
the credit facilities contemplated hereby shall have been entered by the
Bankruptcy Court (which shall, among other things, approve this Credit
Agreement, the Fundamental Documents, the Loans and the transactions
contemplated by this Credit Agreement and the Fundamental Documents);
(z) Total Funded Debt. Total Funded Debt (after giving effect to any
Loans to be made on the Closing Date and all Indebtedness to be outstanding upon
the effectiveness of the Plan of Reorganization) shall not exceed $624.0
million;
(aa) Plan of Reorganization. Substantial consummation of the Plan of
Reorganization in accordance with the terms thereof and of the Final Order
referred to in Section 4.1(y) above shall occur concurrently with the making of
the initial Loans hereunder;
(bb) Merger. The merger of Genesis Health Ventures, Inc. and the
Multicare Companies, Inc., as contemplated by the Plan of Reorganization shall
have been consummated;
(cc) Equity Structure. The Borrower's equity capital shall consist of a
single class of common stock and the Rollover Preferred Stock;
(dd) Debt Rating. The Borrower shall have obtained a minimum senior
secured credit rating of at least "B1" from Moody's and "B+" from S&P;
(ee) Rollover Notes. Execution and delivery of the Rollover Note
Indenture in form and substance and with terms satisfactory to the Co-Lead
Arrangers, the Administrative Agent and the Collateral Monitoring Agent in their
sole discretion (including, but not limited to, (i) a maximum note value of
$243.0 million, (ii) a maximum interest rate of LIBOR plus 5%, (iii) a maturity
date that is at least six (6) months after the maturity date of the B Term Loans
and the Delayed Draw Term Loans, (iv) scheduled amortization in any year prior
to final maturity not exceeding 1% of the original aggregate note value on the
date of issuance of the Rollover Notes and (v) covenants customary for public
indentures and customary provisions relating to the exercise of any remedies
against any collateral with respect to the Rollover Notes satisfactory to the
Co-Lead Arrangers in their sole discretion); and
(ff) Rollover Preferred Stock. Issuance of the Rollover Preferred Stock with
terms satisfactory to the Co-Lead Arrangers, the Administrative Agent and the
Collateral Monitoring Agent in their sole discretion (including, but not limited
to, (i) a maximum liquidation preference of $42.6 million, (ii) a maximum coupon
of 6% per annum, (iii) dividends payable only in kind, (iv) the Borrower having
the right to convert all of the shares of such Preferred Stock to common stock
of the Borrower at any time after the first anniversary of the effective date of
the Plan of Reorganization so long as the average trading price for the
Borrower's common stock over the immediately preceding thirty (30) calendar days
is $30.00 or more, (v) the Rollover Preferred Stock shall be subject to
mandatory redemption by the Borrower on the ninth (9th) anniversary of the
effective date of a Plan of Reorganization, (vi) the Rollover Preferred Stock
shall be subject to mandatory redemption by the Borrower with the proceeds of
any amounts received by the Borrower and its Subsidiaries from any of the
sources referred to in Section 2.11(m) hereof and (vii) such other provisions
satisfactory to the Co-Lead Arrangers in their sole discretion).
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(gg) Appraisals. The Collateral Agent and the Collateral Monitoring
Agent shall receive a copy of recent appraisals made with respect to the Real
Property Assets listed on Schedule 4.1(gg).
SECTION 4.2 Conditions Precedent to Each Revolving Credit Loan and each
Letter of Credit. The obligation of the Issuing Bank to issue each Letter of
Credit and of the Lenders to make each Revolving Credit Loan and to participate
in each Letter of Credit (including the initial Revolving Credit Loan and/or
Letter of Credit) are subject to the following conditions precedent:
(a) Notice. The Administrative Agent shall have received a notice with
respect to such Borrowing or the Issuing Bank and the Administrative Agent shall
have received a notice with respect to such Letter of Credit as required by
Section 2.2 or Section 2.21 hereof, as applicable;
(b) Borrowing Certificate. The Administrative Agent shall have received
a Borrowing Certificate with respect to such Borrowing, duly executed by an
Authorized Officer of the Borrower;
(c) Representations and Warranties. The representations and warranties
set forth in Article 3 hereof and in the other Fundamental Documents shall be
true and correct in all material respects on and as of the date of each
Borrowing or issuance of a Letter of Credit (except to the extent that such
representations and warranties expressly relate to an earlier date) with the
same effect as if made on and as of such date;
(d) No Event of Default. On the date of each Borrowing or issuance of a
Letter of Credit hereunder, no Default or Event of Default shall have occurred
and be continuing, nor shall any such event occur by reason of the making of the
requested Revolving Credit Loan or the issuance of the requested Letter of
Credit; and
(e) Maximum Revolving Credit Amount. After giving effect to the
Revolving Credit Loans to be made or Letters of Credit to be issued, the
aggregate principal amount outstanding of all Revolving Credit Loans plus the
then current L/C Exposure shall not exceed the Maximum Revolving Credit Amount.
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Each request for a Borrowing or issuance of a Letter of Credit hereunder shall
be deemed to be a representation and warranty by the Borrower on the date of
such Borrowing or issuance of a Letter of Credit hereunder as to the matters
specified in paragraphs (c), (d) and (e) of this Section 4.2.
SECTION 4.3 Conditions Precedent to the Making of Delayed Draw
Term Loans. The obligation of each Delayed Draw Term Loan Lender to make Delayed
Draw Term Loans are subject to the following conditions precedent:
(a) Delayed Draw Term Loan Availability Period/Five Draws. The
request for any Borrowing of Delayed Draw Term Loans shall be made during the
Delayed Draw Term Loan Availability Period and no more than four prior requests
for a Borrowing of Delayed Draw Term Loans shall have been made;
(b) Borrowing Certificate. The Administrative Agent shall have
received a Borrowing Certificate with respect to such Borrowing of Delayed Draw
Term Loans, duly executed by an Authorized Officer of the Borrower;
(c) Representations and Warranties. The representations and
warranties set forth in Article 3 hereof or in the other Fundamental Documents
shall be true and correct in all material respects on and as of the date of the
Borrowing of the Delayed Draw Term Loans;
(d) No Event of Default. On the date of the Borrowing of the
Delayed Draw Term Loans, after giving effect to the APS Acquisition and/or
payment of the outstanding balance due to ElderTrust and/or the exercise of one
or more of the Facility Purchase Options (and the purchase of the Facilities
that are the subject thereof), as applicable, on a Pro Forma Basis, no Default
or Event of Default shall have occurred and be continuing unless waived by the
prior written consent of the Required Lenders; and
(e) Documentation for and Making of Payments with Respect to
Facility Purchase Options/Specified Payments/ElderTrust Payments. All (i)
documentation relating to (a) the exercise of one or more of the Facility
Purchase Options (and the purchase of the Facilities that are the subject
thereof), (b) the Specified Payments and (c) the payments to be made to
ElderTrust and (ii) the manner and making of all payments relating to the
transactions referred to in the preceding clause (i) shall be in form and
substance reasonably satisfactory to the Administrative Agent.
A request for a Borrowing of Delayed Draw Term hereunder shall
be deemed to be a representation and warranty by the Borrower on the date of
such Borrowing as to the matters specified in paragraphs (c) and (d) of this
Section 4.3.
5. AFFIRMATIVE COVENANTS
From the date hereof and for so long as any Commitments shall
be in effect, any amount remains outstanding with respect to any Loan, any
Letter of Credit shall remain outstanding (or not cash collateralized in an
amount equal to 105% of the then current L/C Exposure) or any Obligation remains
unpaid or unsatisfied, each Credit Party agrees that, unless the Required
Lenders shall otherwise consent in writing, each of them will:
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SECTION 5.1 Financial Statements and Reports. Subject to the last
paragraph of this Section 5.1, furnish or cause to be furnished to the Agents,
the Issuing Bank and each of the Lenders:
(a) As soon as available, but in any event within ninety (90) days
(plus the period of any extensions obtained by the Borrower pursuant to Rule
12b-25 of the Securities Exchange Act of 1934) after the end of each fiscal year
of the Borrower (commencing with fiscal year September 30, 2001), (i) the
consolidated and consolidating (by major business line) balance sheets of the
Borrower and its Consolidated Subsidiaries, in each case as at the end of, and
the related consolidated statements of income, stockholders' equity and cash
flows for, such fiscal year, and the corresponding figures as at the end of, and
for, the preceding fiscal year, and in the case of such consolidated statements,
certified by and accompanied by an unqualified report and opinion of KPMG LLP,
any other Big Five accounting firm or another independent public accountant of
recognized standing as shall be retained by the Borrower and be satisfactory to
the Administrative Agent, which report and opinion shall be prepared in
accordance with generally accepted auditing standards relating to reporting and
which report and opinion shall contain no material exceptions or qualifications
except for qualifications relating to accounting changes (with which such
independent public accountants concur) in response to FASB releases or other
authoritative pronouncements and (ii) annual percentage statistics concerning
occupancy rate, payor mix, any other statistical and operating information that
Borrower deems relevant in the operation of its business and such other
information as the Administrative Agent and the Co-Lead Arrangers may reasonably
request;
(b) As soon as available, but in any event within forty-five (45) days
(plus the period of any extensions obtained by the Borrower pursuant to Rule
12b-25 of the Securities Exchange Act of 1934) after the end of each of the
first three fiscal quarters of each of its fiscal years, (i) the unaudited,
consolidated and consolidating (by major business line) balance sheets of the
Borrower and its Consolidated Subsidiaries as at the end of, and the related
unaudited consolidated statements of income, stockholders' equity and cash flows
for, such quarter, and for the portion of the fiscal year through the end of
such quarter, and the corresponding figures as at the end of such quarter, and
for the corresponding period, in the preceding fiscal year, together with a
certificate signed by an Authorized Officer of the Borrower, on behalf of the
Borrower, to the effect that such financial statements, while not examined by
independent public accountants, reflect, in the opinion of the Borrower, all
adjustments necessary to present fairly the financial position of the Borrower
and its Consolidated Subsidiaries as at the end of the fiscal quarter and the
results of operations for the quarter then ended in conformity with GAAP,
subject to normal year-end audit adjustments and the absence of footnotes and
(ii) quarterly percentage statistics concerning occupancy rate, payor mix, any
other statistical and operating information that Borrower deems relevant in the
operation of its business and such other information as the Administrative Agent
and the Co-Lead Arrangers may reasonably request;
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(c) As soon as available, but in any event within thirty (30) days
after the end of each month, (i) the unaudited, consolidated and consolidating
(by major business line) balance sheets of the Borrower and its Consolidated
Subsidiaries, as at the end of such month, and the related consolidated
statements of income and cash flows for, such month, and for the portion of the
fiscal year through the end of such month, and the corresponding figures as at
the end of such month, and for the corresponding period as set forth in the
Borrower's current operating budget; provided, however, that the Borrower shall
not be required to deliver monthly balance sheets and cash flow statements for
any month prior to January, 2002, in the preceding fiscal year, together with a
certificate signed by an Authorized Officer of the Borrower, on behalf of the
Borrower, to the effect that such financial statements, while not examined by
independent public accountants, reflect, in the opinion of the Borrower, all
adjustments necessary to present fairly the financial position of the Borrower
and its Consolidated Subsidiaries as at the end of the month and the results of
operations for the month then ended in conformity with GAAP, subject to normal
year-end audit adjustments and the absence of footnotes and (ii) monthly
percentage statistics concerning occupancy rate, payor mix, any other
statistical and operating information that Borrower deems relevant in the
operation of its business and such other information as the Administrative Agent
and the Co-Lead Arrangers may reasonably request;
(d) Simultaneously with the delivery of the statements referred to in
paragraphs (a), (b) and (c) of this Section 5.1, a certificate of an Authorized
Officer of the Borrower in form and substance reasonably satisfactory to the
Administrative Agent (i) stating whether or not such Authorized Officer has
knowledge, after due inquiry, of any condition or event which would constitute
an Event of Default or Default and, if so, specifying each such condition or
event and the nature thereof and what action any Credit Party is taking or
proposes to take with respect thereto and (ii) demonstrating in reasonable
detail compliance with the provisions of Sections 6.6 and 6.9 through 6.14
hereof;
(e) Together with each set of audited financial statements required by
paragraph (a) above, a letter from the independent public accountants rendering
the report thereon stating whether, in connection with their audit examination,
any condition or event, at any time during, or at the end of, the accounting
period covered by such financial statements, has come to their attention which
would cause them to believe that any Default or Event of Default existed on the
date of such financial statements, and if such a condition or event has come to
their attention, specifying the nature and period, if known, of existence
thereof;
(f) Promptly upon their becoming available, copies of all audits,
studies, reports or evaluations prepared for, or submitted to, any of the Credit
Parties by any outside professional firm or service, including, without
limitation, any comment letter submitted by the Borrower's accountants to
management in connection with their annual audit;
(g) Promptly upon their becoming available, copies of all registration
statements, proxy statements, notices and reports which the Borrower or any
other Credit Party shall file with any securities exchange or with the
Securities and Exchange Commission or any successor agency;
(h) Within thirty (30) days after the end of each fiscal year, a set of
financial projections for the Borrower and its Consolidated Subsidiaries for the
next fiscal year in a form and in reasonable detail satisfactory to the
Administrative Agent;
(i) Promptly and in any event within five (5) Business Days after
receipt of any material notice or correspondence from any company or agent for
any company providing insurance coverage to any Credit Party or any Subsidiary
of a Credit Party relating to any material loss or loss with respect to any Real
Property Asset, copies of such notices and/or correspondence;
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(j) Without limiting any Credit Party's other obligations to give
notice under the Fundamental Documents, within twenty (20) days of the end of
each calendar quarter, a schedule setting forth each sale or other disposition
of any asset or property effected outside the ordinary course of business during
such quarter, the date of each such sale or disposition, the sales price with
respect to such asset or property sold or disposed of and the Net Cash Proceeds
received during such quarter from each such sale or disposition;
(k) Each month, within 30 days after the end of the prior month, a
Borrowing Base Certificate;
(l) At the request of the Collateral Agent or the Collateral Monitoring
Agent, provide to the Collateral Agent and the Collateral Monitoring Agent any
documents used in the preparation of any Borrowing Base Certificate, including
without limitation, accounts receivables agings and reconciliations; and
(m) From time to time such additional information regarding the
financial condition or business of any of the Credit Parties or any of their
respective Subsidiaries, any Real Property Asset or the Collateral, as any of
the Agents, the Issuing Bank or any Lender acting through the Administrative
Agent may reasonably request including, without limitation, copies of all
management projections prepared at the reasonable request of any of the Agents.
Information required to be delivered pursuant to clauses (a), (b) or (c) of this
Section 5.1 shall be deemed to have been delivered on the date on which the
Borrower provides notice to the Agents, Issuing Bank and each Lender that such
information has been posted on the Borrower's website on the Internet at the
website address listed on the signature pages hereof, at
[sec.gov/edaux/searches.htm] or at another website identified in such notice and
accessible by the Lenders without charge; provided, that (i) such notice may be
included in a certificate delivered to the Administrative Agent pursuant to
subsection (d) hereof and (ii) the Borrower shall deliver paper copies of the
information referred to in paragraphs (a), (b), (c) and (d) of this Section 5.1
to any Lender that requests such delivery. All other notices and information
required to be provided pursuant to this Section 5.1 shall be deemed delivered
pursuant to this Section 5.1 when delivered to the Administrative Agent;
provided, that the Borrower shall deliver paper copies of any such notice or
information to any Lender that requests such delivery.
SECTION 5.2 Compliance with Laws. (a) Do or cause to be done all things
necessary (i) to preserve, renew and keep in full force and effect its
existence, Proprietary Rights, Regulatory Licenses, other licenses,
Reimbursement Approvals, permits, franchises, certificates (including, without
limitation, certificates of need), authorization, accreditations, easements,
rights of way and other rights, consents and approvals the nonexistence of which
is reasonably likely to have a Material Adverse Effect and (ii) to comply with
all applicable statutes, ordinances, rules, regulations and orders of, and all
applicable restrictions or requirements imposed by, any Governmental Authority
(including, without limitation, health care laws, Environmental Laws, all zoning
and building codes and ERISA) or any other Requirements except where the
necessity of compliance therewith is contested in good faith by the appropriate
proceedings or where such noncompliance in the aggregate would not reasonably be
expected to have a Material Adverse Effect; provided, in each case, that the
applicable Credit Party or Subsidiary of a Credit Party shall have set aside on
its books reasonable reserves (the presentation of which is segregated to the
extent required by GAAP) with respect thereto if such reserves are required by
GAAP or where such noncompliance in the aggregate would not reasonably be
expected to have a Material Adverse Effect.
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(b) Obtain or make all further authorizations, approvals, orders,
consents, licenses, registration or filings from or with any Governmental
Authority required for the performance by any Credit Party of this Credit
Agreement and the other Fundamental Documents to which it is a party.
SECTION 5.3 Maintenance of Properties. Keep its tangible properties
including, without limitation, each Real Property Asset, in good repair, working
order and condition (ordinary wear and tear and damage by casualty excepted)
and, from time to time (i) subject to the terms hereof, make all necessary and
proper repairs, renewals, replacements, additions and improvements thereto and
(ii) comply at all times with the provisions of all Regulatory Licenses,
Reimbursement Approvals, all Management Agreements, leases and other material
agreements to which it is a party so as to prevent any loss or forfeiture
thereof or thereunder unless compliance therewith is being currently contested
in good faith by appropriate proceedings and appropriate reserves have been
established in accordance with GAAP or where such noncompliance in the aggregate
would not reasonably be expected to have a Material Adverse Effect.
SECTION 5.4 Notice of Material Events. (a) Promptly upon, but in any
event within five (5) days after, an Authorized Officer or other executive
officer of any Credit Party obtaining knowledge of (i) any (X) Default or (Y)
Event of Default, (ii) any Material Adverse Effect, (iii) any action, event or
condition which could reasonably be expected to have a Material Adverse Effect,
(iv) the opening of any office of any Credit Party or the change of the chief
executive office or the principal place of business of any Credit Party or of
the location of any Credit Party's books and records with respect to the
Collateral, any Real Property Asset or any Pledged Securities, or the location
of any item of Collateral, (v) any change in the name, corporate structure or
the jurisdiction of organization of any Credit Party, (vi) a change in the
organizational identification number of any Credit Party or the receipt of an
organizational number by a Credit Party which previously did not have one; (vii)
any other event which could reasonably be expected to materially decrease the
value of the Collateral, any Real Property Asset or the Pledged Securities,
(viii) any proposed material amendment to any agreements that are a material
part of the Collateral or relate to any material Real Property Asset or (ix) any
Person giving any notice to any Credit Party or taking any other action to
enforce remedies with respect to a claimed default or event or condition of the
type referred to in paragraphs (g), (h), (i) or (j) of Article 7, (ix) any
strike, walkout, work stoppage or other material labor difficulty with respect
to any Credit Party or Subsidiary of a Credit Party, (x) any pending or
contemplated condemnation proceeding affecting any Real Property Asset which
would result in Net Cash Proceeds of $300,000 or more or (xi) any revocation,
suspension, termination, rescission, non-renewal, forfeiture or similar action
or threat by any Governmental Authority to take any of the foregoing actions
with respect to a Regulatory License or a Reimbursement Approval or any material
amendment to any Regulatory License, Reimbursement Approval or Management
Agreement, give written notice thereof to the Administrative Agent specifying
the nature and period of existence of any such condition or event, or specifying
the notice given or action taken by such Person and the nature of such claimed
Event of Default or condition and what action any Credit Party has taken, is
taking and proposes to take with respect thereto.
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(b) Promptly upon, but in any event within ten (10) days after, an
Authorized Officer or other executive officer of any Credit Party obtains
knowledge of (i) the institution of, or threat of, any action, suit, proceeding,
investigation or arbitration by any Governmental Authority or other Person
against or affecting any Credit Party or any of its assets including, without
limitation, any Real Property Asset, Regulatory License or Reimbursement
Approval but excluding any condemnation proceeding or any sale or disposition in
lieu of condemnation with respect to any Real Property Asset which would result
in Net Cash Proceeds of less than $300,000 and (ii) any material development in
any such action, suit, proceeding, investigation or arbitration (whether or not
previously disclosed to the Administrative Agent), which, in the case of clause
(i) or (ii) above, is reasonably likely to have a Material Adverse Effect, such
Credit Party shall promptly give written notice thereof to the Administrative
Agent and provide such other information as may be available to it to enable the
Administrative Agent to evaluate such matters; and, in addition to the
requirements set forth in clauses (i) and (ii) of this subsection (b), such
Credit Party upon request shall promptly give notice to the Administrative Agent
of the status of any action, suit, proceeding, investigation or arbitration
covered by a report delivered to the Administrative Agent pursuant to this
subsection (b) above and provide such other information as may be reasonably
available to it to enable the Agents to evaluate such matters.
SECTION 5.5 Insurance. (a) Keep its assets, or cause its tenants under
applicable leases to keep its assets, which are of an insurable character
(including, without limitation, all Real Property Assets) insured at all times
with financially sound and reputable insurance companies, against such risks as
is customary for companies of the same or similar size in the same or similar
businesses; provided, that such insurance shall (i) insure the assets
(including, without limitation, all Real Property Assets and all Collateral) of
the Credit Parties and their Subsidiaries (other than motor vehicles) against
all risk of loss or damage including, without limitation, loss by fire,
explosion, theft and such other casualties as may be reasonably satisfactory to
the Collateral Agent, but in no event in an amount less than the replacement
cost value thereof, and (ii) insure the Credit Parties and their Subsidiaries,
and the Agents, the Issuing Bank and the Lenders against comprehensive general
and automobile liability, such policies to be in accordance with customary
industry practice and in such form and amounts and having such coverage as is
customary for companies of the same or similar size in the same or similar
businesses or as otherwise may be reasonably satisfactory to the Administrative
Agent and the Collateral Agent. All such insurance shall (i) contain a Lender's
Loss Payable Endorsement in favor of the Collateral Agent on behalf of the
Secured Parties in all loss or damage insurance policies, (ii) provide that no
cancellation, material reduction in amount or material change in coverage
thereof shall be effective until at least thirty (30) days after written notice
to the Collateral Agent (on behalf of the Secured Parties) thereof, (iii) name
the Collateral Agent (for the benefit of the Secured Parties) as loss payee for
physical damage insurance with respect to property which constitutes Collateral
or a Real Property Asset as to which a Lien has been granted to the Collateral
Agent, with the right, if an Event of Default has occurred and is then
continuing, to adjust losses and claims with respect to such property, and as an
additional insured for liability insurance (provided, that with respect to
property to which a Lien permitted hereunder has been granted to another
creditor, such other creditor may also be named as loss payee, with payment to
be made as their interests may appear and as an additional insured, with the
Collateral Agent), (iv) state that neither the Agents, any of the Lenders, nor
any other Secured Party shall be responsible for premiums, commissions, club
calls, assessments or advances and (v) be reasonably satisfactory in all other
respects (including deductibles) to the Administrative Agent and the Collateral
Agent.
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(b) Upon the request of either the Administrative Agent or the
Collateral Agent, furnish to such Agent, an updated schedule describing all
insurance maintained by the Credit Parties, which schedule shall set forth, for
each insurance policy, the policy number, the type of coverage, the policy
limits and deductibles, the insurer and the expiration date.
(c) Furnish to the Administrative Agent and the Collateral Agent, to
the extent not previously delivered, original certificates of insurance for all
insurance maintained by a Credit Party which certificates shall comply with the
requirements of this Section 5.5 set forth above and contain signatures of duly
authorized representatives of the insurer, at all times prior to policy
termination, cessation or cancellation.
(d) Maintain such other insurance or self insurance as may be required
by Applicable Law or any agreement to which any Credit Party or any Subsidiary
thereof is a party or as either the Administrative Agent or the Collateral Agent
may reasonably request.
SECTION 5.6 Books and Records. (a) Maintain or cause to be maintained
at all times, in accordance with GAAP, true and complete books and records of
its financial operations.
(b) Provide any Agent, the Issuing Bank and their representatives (at
the Borrower's expense) or any Lender and its representatives (at such Lender's
expense) access to such books and records and to any of its properties or assets
upon reasonable notice and during regular business hours in order that such
Agent, the Issuing Bank or such Lender (as applicable) may make such audits and
examinations and make abstracts from such books, accounts, records and other
papers of a Credit Party or a Subsidiary of a Credit Party pertaining to the
Collateral or any Real Property Asset and upon notification to the Borrower,
permit such Agent, the Issuing Bank or such Lender (as applicable) or its
representatives to discuss the affairs, finances and accounts with, and be
advised as to the same by, officers and independent accountants, all as such
Agent, the Issuing Bank or such Lender (as applicable) may deem appropriate for
the purpose of verifying any report delivered by any Credit Party to any of the
Agents, the Issuing Bank and/or the Lenders pursuant to this Credit Agreement or
for otherwise ascertaining compliance with this Credit Agreement or any other
Fundamental Document.
SECTION 5.7 Observance of Agreements. (a) Duly observe and perform all material
terms and conditions of any agreement relating to any Real Property Asset, any
Management Agreement or any other agreement which is material to the Credit
Parties taken as a whole and diligently protect and enforce the rights of the
Credit Parties and their Subsidiaries under all such agreements in a manner
consistent with prudent business judgment and subject to the terms and
conditions of such agreements.
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(b) Promptly provide the Agents copies of any and all agreements
amending, altering, modifying, waiving or supplementing in any material respect
the Rollover Note Indenture and any other agreement which is material to the
Credit Parties taken as a whole.
(c) Maintain in effect all material Regulatory Licenses and material
Reimbursement Approvals necessary to the operation of its business.
(d) Except where the failure to participate or comply could not
reasonably be expected to have a Material Adverse Effect, continue its
participation in all Third Party Payor Arrangements and comply with all rules,
regulations, standard procedures and decrees necessary to continue its
participation in such Third Party Payor Arrangements and prepare and file all
applicable cost reports with respect to such Third Party Payor Arrangements.
SECTION 5.8 Taxes and Charges. Duly pay and discharge, or cause to be
paid and discharged, before the same shall become in arrears (after giving
effect to applicable extensions), all taxes, assessments, levies and other
governmental charges, imposed upon any Credit Party or Subsidiary of a Credit
Party or its properties, sales and activities, or any part thereof, or upon the
income or profits therefrom, as well as all claims for labor, materials, or
supplies which if unpaid might by law become a Lien upon any property of any
Credit Party or any Subsidiary of a Credit Party; provided, however, that any
tax, assessment, levy, governmental charge or claim for labor, material or
supplies need not be paid if the validity or amount thereof shall currently be
contested in good faith by appropriate proceedings and if such Credit Party or
Subsidiary of a Credit Party shall have set aside on its books reasonable
reserves (the presentation of which is segregated to the extent required by
GAAP) with respect thereto if such reserves are required by GAAP; and provided,
further, that such Credit Party or Subsidiary of a Credit Party will pay all
such taxes, assessments, levies or other governmental charges and claims for
labor, material or supplies forthwith upon the commencement of proceedings to
foreclose any Lien which may have attached as security therefor.
SECTION 5.9 Liens. Defend the Collateral (including, without
limitation, the Pledged Securities) and the Real Property Assets against any and
all Liens, claims and other impediments howsoever arising, other than Permitted
Liens, and in any event defend the same against any attempted foreclosure.
SECTION 5.10 Further Assurances; Security Interests. (a) Upon the
request of any of the Agents, duly execute and deliver, or cause to be duly
executed and delivered, at the cost and expense of the Credit Parties, such
further instruments as may be necessary in the reasonable judgment of such Agent
or its counsel to carry out the provisions and purposes of this Credit Agreement
and the other Fundamental Documents.
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(b) Upon the request of the Collateral Agent, promptly execute and
deliver or cause to be executed and delivered, at the cost and expense of the
Credit Parties, such further instruments as may be appropriate in the reasonable
judgment of such Agent or its counsel, to provide the Collateral Agent for the
benefit of the Secured Parties a first perfected Lien in the Collateral and all
the Real Property Assets, and any and all documents (including, without
limitation, an amendment or supplement of any financing statement and a
continuation statement or other statement) for filing under the provisions of
the UCC and the rules and regulations thereunder, or any other Applicable Law of
the United States or any other jurisdiction which any Agent may deem reasonably
necessary or advisable, and perform or cause to be performed such other
ministerial acts which are reasonably necessary or advisable, from time to time,
in order to grant and maintain in favor of the Collateral Agent for the benefit
of the Secured Parties the security interest in the Collateral and the Real
Property Assets contemplated hereunder and under the other Fundamental
Documents, subject only to Permitted Liens.
(c) Promptly undertake to deliver or cause to be delivered to the
Collateral Agent from time to time such other documentation, consents,
authorizations and approvals, in form and substance reasonably satisfactory to
the Collateral Agent, as the Collateral Agent or its counsel shall deem
reasonably necessary or advisable to perfect or maintain the Liens of the
Collateral Agent for the benefit of the Secured Parties.
(d) Without limiting the generality of the foregoing provisions of this
Section 5.10, use commercially reasonable efforts to correct as soon as
practicable, matters with respect to title concerning the properties set forth
on Schedule 3.10(a) hereto.
SECTION 5.11 Environmental Laws. (a) Promptly notify the Administrative
Agent and the Collateral Agent upon any Credit Party gaining actual knowledge of
any violation or non-compliance with, or liability or potential liability under,
any Environmental Laws which, when taken together with all other violations of,
or liability under, Environmental Law is reasonably be expected to have a
Material Adverse Effect, and promptly furnish to the Administrative Agent and
the Collateral Agent all written notices of any nature which any Credit Party or
any Subsidiary of a Credit Party may receive from any Governmental Authority or
other Person with respect to any violation, or potential violation or
non-compliance with, or liability or potential liability under, any
Environmental Laws which, in any case or when taken together with all such other
notices, could reasonably be expected to have a Material Adverse Effect.
(b) Comply with and use reasonable efforts to ensure compliance by all
tenants and subtenants with all Environmental Laws, and obtain and comply in all
respects with and maintain and use reasonable efforts to ensure that all tenants
and subtenants obtain and comply in all respects with and maintain any and all
Environmental Permits required by Environmental Laws, except where failure to do
so is not reasonably likely to have a Material Adverse Effect.
(c) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under all
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities, except where failure to
do so would not have a Material Adverse Effect. Any order or directive whose
lawfulness is being contested in good faith by appropriate proceedings shall be
considered a lawful order or directive when such proceedings, including any
judicial review of such proceedings, have been finally concluded by the issuance
of a final non-appealable order; provided, however, that the appropriate Credit
Party shall have set aside on its books reasonable reserves (the presentation of
which is segregated to the extent required by GAAP) with respect thereto.
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(d) Indemnify, defend and hold harmless the Agents, the Issuing Bank,
the Lenders and the other Secured Parties, and their respective officers,
directors, shareholders, employees, agents, representatives, successors and
assigns from and against any liability, fine, penalty, loss, damage, suit,
settlement, action, expense and cost (including, but not limited to, reasonable
attorneys' fees (including cost of in-house counsel) and environmental
consultant fees), arising out of or relating to: (A) the presence or Release of
any Hazardous Materials at, to, on, under, from, or about any Premises; (B) any
violation of any Environmental Law or Environmental Permit by any Credit Party
or any Subsidiary of any Credit Party; (C) the transportation or the arrangement
for the transportation, handling, treatment, or disposal of any Hazardous
Materials to any location other than any Premises by or on behalf of any Credit
Party or any Subsidiary of any Credit Party; (D) any Environmental Claim
relating to any Premises or any activities conducted at any Premises; and (E)
any breach of any environmental representation or covenant in this Credit
Agreement or any other Fundamental Document (but excluding any such liability,
fine, penalty, loss, damage, suit, settlement, action, expense or cost of an
indemnified party to the extent primarily caused by the gross negligence or
willful misconduct of such indemnified party as determined by a final judgment
of a court of competent jurisdiction). The obligations of the Borrower under
this Section 5.11(d) shall survive the Facility Termination Date, the
termination of this Credit Agreement, the payment of the Obligations and the
expiration, termination and/or cancellation of the Letters of Credit hereunder
indefinitely.
SECTION 5.12 Subsidiaries. Deliver to the Administrative Agent
reasonably promptly after formation or acquisition of any new Subsidiary (but in
any event prior to commencement of operations by such Subsidiary), an Instrument
of Assumption and Joinder executed by such Subsidiary, appropriate UCC-1
financing statements, Mortgages and/or other security documents, organizational
documents and written opinions of counsel, all as may be reasonably requested by
any of the Agents or their counsel and all in form and substance reasonably
satisfactory to the Agents and their counsel and if applicable, certificates or
other instruments (if any) representing 100% of the stock or other equity
interests of such Subsidiary together with an undated stock power (or other
appropriate document) executed in blank for each such certificate or other
instrument.
SECTION 5.13 Lease Agreements. From time to time (i) furnish to the
Administrative Agent such information and reports regarding any lease agreement
with respect to a Real Property Asset to which a Credit Party or any Subsidiary
thereof is a party as the Administrative Agent may reasonably request and (ii)
upon the occurrence and continuation of an Event of Default and the reasonable
request of the Administrative Agent, make such demands and requests for
information, reports or action to the other parties to a lease agreement to
which a Credit Party or any Subsidiary thereof is a party, as the Credit Party
or Subsidiary is entitled to make under each such lease agreement.
SECTION 5.14 Interest Rate Protection. No later than January 1, 2002
and at all times thereafter, maintain or cause to be maintained Interest Rate
Protection Agreements having terms, conditions and tenors reasonably acceptable
to the Administrative Agent to the extent necessary so that until two (2) years
after the Closing Date, interest on Indebtedness in a principal amount equal to
at least 50% of the total outstanding funded Indebtedness of the Borrower and
its Consolidated Subsidiaries at any time, is effectively fixed or capped at
rates which are acceptable to the Administrative Agent.
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SECTION 5.15 After-Acquired Real Property Assets. If, after the Closing
Date, any Credit Party purchases, leases or otherwise acquires any Real Property
Asset including, without limitation, the properties that are the subject of the
Facility Purchase Options, ElderTrust properties and properties acquired through
Specified Payments, (a) promptly, but in any event within thirty (30) days,
after such purchase, lease or other acquisition, provide written notice thereof
to the Administrative Agent and the Collateral Agent, setting forth with
specificity a description of such Real Property Asset acquired, a title
commitment, a survey (if available) and such Credit Party's good faith estimate
of the current fair market value of such Real Property Asset and (b) if either
such Agent so requests, the applicable Credit Party shall promptly execute and
deliver to the Collateral Agent, a Mortgage and such other documents or
instruments as such Agent shall reasonably request with respect to such Real
Property Asset.
SECTION 5.16 Lender Meetings. From time to time as requested by the
Administrative Agent or the Required Lenders, participate in, and cause an
Authorized Officer of the Borrower to be available for and to participate in, a
meeting of Lenders to be held, at reasonable intervals, at locations and at
times reasonably requested by the Administrative Agent (or, if applicable, the
Required Lenders).
SECTION 5.17 Use of Proceeds of Revolving Credit Loans. Use the
proceeds of the Loans for the purposes which are not otherwise prohibited by the
terms of this Credit Agreement, including, without limitation, Sections 2.1(b),
2.2(b) and 2.3(b).
SECTION 5.18 Cash Management System. At all times maintain or cause to
be maintained an integrated cash management system in accordance with the terms
of Section 8.3 hereof.
SECTION 5.19 Subordination, Non-Disturbance and Attornment Agreements,
Etc. (a) Use all commercially reasonable efforts to deliver to the Collateral
Agent as soon as reasonably practicable after the Closing Date, executed and
acknowledged subordination, non-disturbance and attornment agreements and
estoppel certificates, in form and substance reasonably satisfactory to the
Collateral Agent and the Borrower, with respect to all leases reasonably
designated by the Collateral Agent encumbering the Real Property Assets and
which by their terms are not subject and subordinate to the Mortgages; provided,
that commercially reasonable efforts shall not be construed as requiring payment
of any consent fee or other consideration for any third party's execution and
delivery of any such agreement.
(b) Use all commercially reasonable efforts to deliver to the
Collateral Agent as soon as reasonably practicable after the Closing Date, such
other certificates, documents and agreements respecting any Real Property Asset
leased by Borrower or any of its Subsidiaries as lessee, as the Collateral Agent
may, in its sole discretion, request (including, but not limited to, estoppel
certificates from lessors under any such lease, consents from lessors under any
such lease, modifications of any such lease to incorporate customary leasehold
financing provisions, a recordable memorandum of any such lease, and a
non-disturbance agreement from the holder of each mortgage covering the real
property demised by any such lease); provided, that commercially reasonable
efforts shall not be construed as requiring payment of any consent fee or other
consideration for any third party's execution and delivery of any such
agreement.
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SECTION 5.20 ERISA Plan Compliance and Reports. Furnish to the
Administrative Agent (i) as soon as possible, and in any event within thirty
(30) days after any executive officer of a Credit Party has knowledge that (A)
any Reportable Event with respect to any Plan has occurred, a statement of an
executive officer of the Credit Party, setting forth on behalf of such Credit
Party details as to such Reportable Event and the action which it proposes to
take with respect thereto, together with a copy of the notice, if any, required
to be filed of such Reportable Event given to the PBGC or (B) an accumulated
funding deficiency has been incurred or an application has been made to the
Secretary of the Treasury for a waiver or modification of the minimum funding
standard or an extension of any amortization period under Section 412 of the
Code with respect to a Plan or Multiemployer Plan has been or is proposed to be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA, proceedings have been instituted to terminate a Plan if such Plan is
subject to Title IV of ERISA, an action has been instituted pursuant to Section
515 of ERISA to collect a delinquent contribution to a Multiemployer Plan, or
any such Credit Party or ERISA Affiliate will incur any liability to or on
account of the termination of or withdrawal from a Plan subject to Title IV of
ERISA or Multiemployer Plan under Sections 4062, 4063, 4201 or 4204 of ERISA, a
statement of an executive officer of the Credit Party, setting forth details as
to such event and the action the applicable Credit Party proposes to take with
respect thereto, (ii) promptly upon reasonable request of the Administrative
Agent, copies of each annual and other report with respect to each Plan and
(iii) promptly after receipt thereof, a copy of any notice any Credit Party or
ERISA Affiliate may receive from the PBGC relating to the PBGC's intention to
terminate any Plan subject to Title IV of ERISA or to appoint a trustee to
administer any Plan subject to Title IV of ERISA.
SECTION 5.21 Covenant Regarding Certain Post-Closing Matters.
Furnish to the Administrative Agent within 45 days after the Closing Date good
standing certificates for each Credit Party (other than Credit Parties for which
good standing certificates were delivered at closing pursuant to Section
4.1(b)(iv)) from their jurisdiction of incorporation.
6. NEGATIVE COVENANTS
From the date hereof and for so long as any Commitments shall
be in effect, any amount remains outstanding with respect to any Loan, any
Letter of Credit shall remain outstanding (or not cash collateralized in an
amount equal to 105% of the then current L/C Exposure) or any Obligation remains
unpaid or unsatisfied, each Credit Party agrees that, unless the Required
Lenders shall otherwise consent in writing, it will not:
SECTION 6.1 Limitations on Indebtedness and Preferred Stock.
Incur, create, assume or suffer to exist any Preferred Stock or Indebtedness,
other than:
(a) the Indebtedness and other Obligations under this Credit
Agreement, and any Indebtedness refinancing all or any portion of the
Indebtedness and/or other Obligations under this Credit Agreement; provided,
that the terms of any Indebtedness refinancing only a portion of the
Indebtedness and other Obligations under this Credit Agreement shall have been
approved in writing by the Administrative Agent and the Required Lenders;
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(b) Intentionally omitted;
(c) existing Indebtedness described on Schedule 6.1 hereto,
but not any extensions or renewals or refinancings thereof unless effected on
substantially the same terms or terms more favorable to the applicable Credit
Party or Subsidiary thereof which is the obligor of such Indebtedness (provided,
that the interest rate may be at the then prevailing rate for the same type of
Indebtedness);
(d) Indebtedness in respect of intercompany advances
constituting Investments permitted under Section 6.4 hereof;
(e) Indebtedness in respect of secured purchase money
financing (including Capital Leases), to the extent permitted by Section 6.2(e)
hereof;
(f) Indebtedness incurred under Interest Rate Protection
Agreements to the extent entered into by the applicable Credit Party as required
by Section 5.14 hereof or for bona fide hedging purposes;
(g) Indebtedness of a Person which becomes a Subsidiary of a
Credit Party after the Closing Date; provided, that (i) such Indebtedness
existed at the time the Person became a Subsidiary and was not created in
anticipation of the acquisition of such Person, (ii) immediately after giving
effect to the acquisition of such Person by a Credit Party, no Default or Event
of Default shall have occurred and be continuing and (iii) such Indebtedness is
non-recourse to the Borrower or any other Credit Party (other than such Person
and its Subsidiaries to the extent such Indebtedness was with recourse to such
Subsidiaries at the time such Person became a Subsidiary of a Credit Party);
(h) Indebtedness secured by any asset at the time of
acquisition of such asset by a Credit Party or a Subsidiary of a Credit Party
(not in violation of any of the terms hereof) at any time after the Closing
Date; provided, that (i) such Indebtedness existed at the time the asset was
acquired by a Credit Party and was not created in anticipation of the
acquisition thereof, (ii) such Indebtedness is non-recourse to the Borrower or
any other Credit Party (other than to the specific asset acquired) and (iii) the
aggregate principal amount of Indebtedness of all of the Credit Parties
permitted by this Section 6.1(h) shall not exceed $5,000,000 at any time;
(i) Guarantees permitted pursuant to Section 6.3 hereof;
(j) deferred payment obligations resulting from the
adjudication or settlement of any litigation involving a Credit Party or a
Subsidiary of a Credit Party; provided, that (i) the aggregate amount of such
obligations for all of the Credit Parties and their Subsidiaries shall not
exceed $5,000,000 at any time and (ii) the judgment(s) to which such obligations
relate would not be an Event of Default hereunder;
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(k) The Rollover Notes and any refinancings thereof on terms
and conditions satisfactory to the Administrative Agent and the Co-Lead
Arrangers and no less favorable to the Lenders;
(l) High Yield Unsecured Debt not exceeding $250,000,000 in
principal amount; provided, that the Credit Party shall deliver to the
Administrative Agent, at least ten (10) Business Days before incurring such
debt, a certificate in form satisfactory to the Administrative Agent, in its
sole discretion, demonstrating that on a Pro Forma Basis after issuing such High
Yield Unsecured Debt such Credit Party will remain in compliance with the
financial covenants set forth in Section 6.9 through 6.14 hereof;
(m) the Rollover Preferred Stock;
(n) Indebtedness in favor of Cardinal incurred in the ordinary
course of business; and
(o) other unsecured Indebtedness in an aggregate principal
amount not exceeding an amount equal to the difference of $25,000,000 less the
principal amount of any Indebtedness incurred pursuant to Section 6.1(e).
SECTION 6.2 Limitations on Liens. Incur, create, assume or
suffer to exist any Lien on any of its revenue stream, property or assets,
whether now owned or hereafter acquired, except:
(a) deposits under worker's compensation, unemployment
insurance and social security and similar laws or to secure statutory
obligations or surety, appeal, performance, completion or other similar bonds,
to secure performance as lessee under leases of real or personal property or to
secure performance of tenders, bids, contracts (other than for the repayment of
Indebtedness) and other obligations of a like nature, in each case incurred in
the ordinary course of business;
(b) Liens customarily granted or incurred in the ordinary
course of business with regard to services rendered by carriers, warehouses,
suppliers of materials and equipment, mechanics and repairmen and other Liens
imposed by Applicable Law which obligations are not yet due and payable (unless
such obligations are being contested in good faith and with respect to which
appropriate reserves have been established in accordance with GAAP);
(c) the Liens in favor of the Collateral Agent (for the
benefit of the Secured Parties) under this Credit Agreement, the other
Fundamental Documents and any other document contemplated hereby or thereby;
(d) existing Liens listed on Schedule 6.2 hereto, including,
but not limited to, the Cardinal Lien;
(e) Liens granted to a Person financing the acquisition of
property, plant or equipment if (i) the Lien is limited to the particular assets
acquired; (ii) the Indebtedness secured by the Lien does not exceed the
acquisition cost of the particular asset for which such Lien is
granted; (iii) such transaction does not otherwise violate this Credit
Agreement; and (iv) the aggregate amount of all Indebtedness secured by such
Liens does not exceed $25,000,000 at any one time outstanding for all of the
Credit Parties and their Subsidiaries;
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(f) Liens arising out of attachments, judgments or awards as
to which an appeal or other appropriate proceedings for contest or review are
timely commenced (and as to which foreclosure and other enforcement proceedings
shall not have been commenced (unless fully bonded or otherwise effectively
stayed)) and as to which appropriate reserves have been established in
accordance with GAAP;
(g) Liens for taxes, assessments or other governmental charges
or levies not yet due and payable, or the validity or amount of which is
currently being contested in good faith by appropriate proceedings and for which
reserves have been set aside on the books of the applicable Credit Party or
Subsidiary, in each case pursuant to and in accordance with the terms of Section
5.8 hereof;
(h) financing statements filed in connection with a Capital
Lease or an operating lease, in each case not prohibited hereunder; provided,
that no such financing statement extends, covers or refers to any property or
assets of a Credit Party or a Subsidiary thereof, other than the property or
assets which are subject to such Capital Lease or such operating lease;
(i) easements (including, without limitation, reciprocal
easement agreements and utility agreements), rights of way requirements,
restrictions (including, without limitation, zoning restrictions), covenants,
consents, reservations, encroachments, variations and other similar
restrictions, charges, encumbrances (whether or not recorded) (but specifically
excluding rights of first refusal, options and other contractual rights to sell,
assign or otherwise dispose of any Real Property Asset or any interest therein)
on any Real Property Asset which, in the aggregate, (i) do not materially
detract from the value of the applicable Real Property Asset subject thereto,
(ii) do not materially interfere with the ordinary conduct of the business of
the Credit Parties, any Subsidiary of a Credit Party or any lessee under a lease
or (iii) do not materially impair the use of the applicable Real Property Asset
by any Credit Party, any Subsidiary of a Credit Party or any lessee under a
lease;
(j) Liens on the property or assets of a Person which becomes
a Subsidiary of a Credit Party after the Closing Date securing Indebtedness
permitted under Section 6.1(g) hereof; provided, that (i) such Liens existed at
the time such Person became a Subsidiary and were not created in anticipation of
the acquisition of such Person, (ii) any such Lien does not by its terms cover
any property or assets after the time such Person becomes a Subsidiary which
were not covered immediately prior thereto, and (iii) any such Lien does not by
its terms secure any Indebtedness other than Indebtedness existing immediately
prior to the time such Person becomes a Subsidiary;
(k) Liens arising by virtue of any statutory or common law
provision relating to banker's liens, rights of set off or similar rights with
respect to deposit accounts;
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(l) Liens on assets at the time of acquisition of the asset by
a Credit Party or a Subsidiary thereof; provided, that (i) such Liens existed at
the time of such acquisition and were not created in anticipation of the
acquisition of such asset, (ii) any such Lien does not by its terms cover any
property or assets other than the asset acquired, and (iii) any such Lien does
not by its terms secure any Indebtedness other than Indebtedness permitted
pursuant to Section 6.1(h);
(m) Liens securing refinancing Indebtedness permitted by
Section 6.1(c) and 6.1(k); provided, that such Liens shall by their terms cover
only such property or assets as is covered by the Liens securing the
Indebtedness being refinanced and no new or additional property or assets and
any Liens granted with respect to such refinancing Indebtedness shall be
subordinated to at least the same extent as the existing Liens securing such
Indebtedness being refinanced;
(n) Liens incurred in the ordinary course of business with
respect to obligations that do not exceed $5,000,000 in the aggregate at any one
time outstanding and that are not incurred in connection with Indebtedness or
the obtaining of advances or credit (other than trade credit in the ordinary
course of business);
(o) rights of first refusal, options or other contractual
rights to sell, assign or otherwise dispose of any Real Property Asset or
interest therein which right of first refusal, option or contractual right (i)
is described on Schedule 3.10(d) hereto, (ii) has been consented to in writing
by the Administrative Agent, (iii) is in connection with an asset sale permitted
by Section 6.7 hereof or (iv) in the case of such rights granted after the
Closing Date when taken with all other rights of first refusal, options and
other contractual rights permitted by this clause (o), do not over the term of
this Credit Agreement affect Real Property Assets having an aggregate fair
market value exceeding $5,000,000; and
(p) Liens granted on certain Real Property Assets pursuant to
Mortgages with respect to the Rollover Notes, to the extent and only to the
extent such Liens are at all times subject to the provisions of the
Intercreditor Agreement.
SECTION 6.3 Limitation on Guaranties. Incur, create, assume or
suffer to exist any Guaranty, either directly or indirectly, except:
(a) the endorsement of negotiable instruments for deposit or
collection in the ordinary course of business;
(b) the Guaranties made by the Guarantors pursuant to Article
9 hereof;
(c) Guaranties of obligations of a Credit Party which
obligations are not prohibited hereunder;
(d) Guaranties set forth on Schedule 6.1 hereto;
(e) Guaranties of Indebtedness permitted by Section 6.1
hereof; provided that Guaranties of any Subordinated Debt shall be subordinated
to the same extent as such Subordinated Indebtedness.
93
(f) Guaranties constituting Investments that are not
prohibited by Section 6.4;
(g) other Guaranties of obligations and liabilities which do
not in the aggregate expose the guarantors thereof to an amount in excess of
$5,000,000. and
(h) Guaranties by the Borrower of the obligations set forth on
Schedule 6.3 hereto.
SECTION 6.4 Limitations on Investments. Create, make or incur
any Investment, except:
(a) cash and Cash Equivalents;
(b) Investments (whether as equity or loans) by the Borrower
or a Credit Party in another Credit Party or a Person that immediately becomes a
Credit Party;
(c) Investments (whether as equity or loans) by the Borrower
or a Credit Party in Subsidiaries which are not Credit Parties; provided, that
the aggregate amount of Investments of the Credit Parties in such Subsidiaries
may not exceed $5,000,000 at any time;
(d) additional Investments received in settlement of
Indebtedness or other obligations created in the ordinary course of business and
owing to any Credit Party or a Subsidiary of a Credit Party;
(e) Investments in Joint Ventures and partnerships permitted
by Section 6.17 hereof; provided, that the aggregate amount of Investments of
the Credit Parties and their Subsidiaries taken as a whole in Joint Ventures and
partnerships may not exceed $25,000,000 at any time;
(f) existing Investments listed on Schedule 6.4 hereto.
(g) Investments made as a result of the receipt of non-cash
consideration from an asset sale made in compliance with Section 6.7 hereof; and
(h) Guaranties permitted by Section 6.3.
SECTION 6.5 Restricted Payments. Pay, declare, make or become
obligated to make any Restricted Payment, except:
(a) the declaration and payment of dividends and/or
distributions by any direct or indirect wholly-owned Subsidiary of a Credit
Party to a Credit Party;
(b) to the extent permitted under Section 13.16 hereof,
payments with respect to intercompany Indebtedness, intercompany receivables or
intercompany advances constituting Investments permitted under Section 6.4
hereof;
94
(c) the declaration and payment of any dividend or
distribution by a Joint Venture of the Borrower, (which Joint Venture is a
Subsidiary of the Borrower) to the holders of its equity interests on a pro rata
basis;
(d) so long as no Default or Event of Default has occurred and
is continuing, required payments (but not prepayments) of interest (in cash only
to the extent required) with respect to the Rollover Notes or any High Yield
Unsecured Debt incurred pursuant to Section 6.1; provided, that such payment of
interest is not prohibited by the subordination provisions of such subordinated
Indebtedness or any subordination agreements with respect thereto;
(e) Redemption of the Rollover Preferred Stock with the
proceeds of any amounts received by the Borrower and its Subsidiaries from any
of the sources referred to in Section 2.11(m) hereof;
(f) Regularly scheduled payment of principal on the Rollover
Notes and redemption of Rollover Notes from the sources and to the extent
permitted by Section 2.11 hereof; and
(g) Investments permitted under Section 6.4(e) hereof.
SECTION 6.6 Limitation on Leases. Create, incur or assume any
commitment to make, any direct or indirect payment, whether as rent or
otherwise, under any lease, rental or other arrangement for the use of real
and/or personal property (including Capital Leases), excluding (i) leases
existing on the date hereof and any renewals thereof and (ii) any leases
acquired in the APS Acquisition, if immediately thereafter the aggregate of all
such payments that shall be payable by a Credit Party and any of their
Subsidiaries during any twelve consecutive months would exceed $5,000,000.
SECTION 6.7 Merger, Sale of Assets, Purchases, etc. (a)
Whether in one transaction or a series of transactions, wind up, liquidate or
dissolve its affairs, or enter into any transaction of merger or consolidation,
or sell or otherwise dispose of any capital stock of any Subsidiary of any
Credit Party, or any of its property, stock or assets or agree to do or suffer
any of the foregoing, except for:
(i) the merger by any solvent Guarantor into the Borrower or
another Guarantor if after such merger, no Default or Event of Default
exists;
(ii) the transfer by any solvent Guarantor of all of its
assets to the Borrower or another Guarantor and the subsequent
dissolution of such solvent Guarantor if after such transactions, no
Default or Event of Default exists;
(iii) the transfer of assets to a Joint Venture, partnership
or other Person to the extent permitted by Section 6.4(e) and Section
6.17 hereof;
(iv) the sale or other disposition of Non-Core Assets;
95
(v) sales or other dispositions of assets (other than Real
Property Assets) in the ordinary course of business;
(vi) sales or dispositions of assets for fair market value,
the Net Cash Proceeds of which are either (x) applied as mandatory
prepayments of the Loans as required by Section 2.11(c) hereof or (y)
within 180 days of such sale or disposition reinvested in the purchase
of assets to be used in the business of the Credit Parties so long as
pending such reinvestment any such Net Cash Proceeds are held in the
Cash Collateral Account; provided, that any such sales or dispositions
do not exceed $40 million in the aggregate during any fiscal year of
the Borrower and its Subsidiaries;
(vii) the use of cash in the ordinary course of business,
subject to the provisions of this Credit Agreement;
(viii) the granting of Permitted Liens;
(ix) the transfers of assets constituting Investments
permitted by Section 6.4 or Restricted Payments permitted by Section
6.5; and
(x) swaps of assets used in the business in a substantially
concurrent exchange for other assets to be used in the business (such
newly acquired asset or assets a "Swapped Asset"); provided, that (a)
the aggregate LTM EBITDA for all Swapped Assets (determined for each
Swapped Asset as of the time of exchange thereof) during the term of
this Agreement shall not exceed $15,000,000, (b) after giving effect to
such asset swap on a Pro Forma Basis, no Default or Event of Default
has occurred and is continuing, (c) LTM EBITDA for the Swapped Asset
shall be at least 90% of LTM EBITDA for the asset exchanged therefor
and (d) all aspects of the asset swap (including, without limitation,
the calculation of LTM EBITDA in connection therewith) shall be
satisfactory to the Administrative Agent and the Co-Lead Arrangers in
their sole discretion.
Sales or dispositions of assets referred to in clause (vi) shall be
subject to the following: (A) if the sale price in any single
transaction or series of transactions is greater than $5,000,000 then
the fair market value of such asset shall be determined in good faith
and approved by the Board of Directors of the Borrower and the Borrower
shall deliver to the Administrative Agent a certificate of an
Authorized Officer of the Borrower attesting to such fair market value
and determination by the Board of Directors, (B) not less than 90% of
the sale price for each asset sold or disposed of shall be payable in
cash on the date of such sale or disposition; (C) the non-cash portion
of the sale price therefor, if any, shall be evidenced by one or more
promissory notes maturing no later than three (3) years after the date
of such sale or disposition (which notes shall be pledged to the
Collateral Agent (for the benefit of the Secured Parties)) and by no
other form of consideration; provided, that additional consideration
may be received by the applicable Credit Party or Subsidiary with
respect to rent escalation provisions, reset rights or other rights
substantially similar to either of the foregoing, (which additional
consideration and/or rights shall be pledged to the Collateral Agent
(for the benefit of the Secured Parties), (D) if such sale or
disposition is to an Affiliate, it shall be made in compliance with
Section 6.15 hereof and (E) the applicable Credit Party shall deliver
to the Administrative Agent, no less than ten (10) Business Days prior
to the date of any expected sale or other disposition, written notice
of the identity of the purchaser or transferee, the expected date of
the closing of such sale or other disposition, the expected date of
receipt by the applicable Credit Party of the Net Cash Proceeds with
respect thereto, the principal terms of the sale or disposition and
such other information as the Administrative Agent may request.
96
(b) Purchase or otherwise acquire all or substantially all of
any stock or asset of any other Person, except for:
(i) transactions contemplated by Sections 6.7(a)(i) and
6.7(a)(ii) above;
(ii) the APS Acquisition and the exercise of the Facility
Purchase Options and the purchase of the facilities that are the
subject thereof;
(iii) the purchase or other acquisition of assets for cash
consideration not exceeding $20,000,000 per calendar year;
(iv) the creation of new Subsidiaries which immediately become
Guarantors to the extent required by and in accordance with Section
5.13 hereof;
(v) Investments permitted by Section 6.4 hereof; and
(vi) asset swaps permitted under Section 6.7(a)(x) hereof.
SECTION 6.8 Places of Business; Change of Name. Change the
location of its chief executive office or principal place of business or any of
the locations where it keeps any portion of the Collateral or its books and
records with respect to the Collateral, change its name or change its
jurisdiction of incorporation or organization, without in each case (i) giving
the Administrative Agent and the Collateral Agent thirty (30) days prior written
notice of such change and (ii) filing any additional Uniform Commercial Code
financing statements, and such other documents requested by either such Agent to
maintain perfection of the security interest of the Collateral Agent for the
benefit of the Secured Parties in the Collateral and in each Real Property
Asset.
SECTION 6.9 Limitations on Capital Expenditures. (a) Make or
incur any obligation to make Capital Expenditures (including obligations under
Capital Leases) which in the aggregate for each of the fiscal years indicated
below exceed the amount set forth opposite such fiscal year:
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Fiscal Year Amount (in millions)
----------- --------------------
Closing Date through September 30, 2002 $61.0 million
October 1, 2002 - September 30, 2003 $63.0 million
October 1, 2003 - September 30, 2004 $65.0 million
October 1, 2004 - September 30, 2005 $68.0 million
October 1, 2005 - September 30, 2006 $71.0 million
October 1, 2006 - Term Loan Maturity Date $36.0 million
provided, that upon and after the closing date of the APS Acquisition, (i) from
and after such closing date until the first anniversary thereof, an additional
$8,000,000 in Capital Expenditures shall be permitted hereunder, (ii) from and
after the first anniversary date of such closing date until the second
anniversary of such closing date, an additional $8,000,000 in Capital
Expenditures shall be permitted hereunder and (iii) beginning with each fiscal
year which commences after the second anniversary of such closing date, an
additional $2,000,000 in Capital Expenditures shall be permitted hereunder.
(b) To the extent the amount of Capital Expenditures permitted
by the preceding paragraph (a) for any fiscal year (without regard to any
carry-over from a prior year pursuant to this paragraph) is in excess of the
actual amount of Capital Expenditures for such period, the amount of permitted
Capital Expenditures during the immediately succeeding fiscal year only, shall
be increased by the lesser of (i) the amount of such excess and (ii) the amount
equal to 20% of the amount of Capital Expenditures permitted by such paragraph
(a) without regard to any carry-over from a prior year pursuant to this
paragraph) for the period with respect to which such excess exists.
SECTION 6.10 Minimum Consolidated EBITDAR. For each Rolling
Four Quarters period ending on the dates indicated below, permit Consolidated
EBITDAR to be less than the corresponding amount set forth below:
Period Ended Amount (in millions)
------------ --------------------
December 31, 2001 $208.0 million
March 31, 2002 $208.0 million
June 30, 2002 $208.0 million
September 30, 2002 $210.0 million
December 31, 2002 $210.0 million
March 31, 2003 $210.0 million
June 30, 2003 $210.0 million
September 30, 2003 $220.0 million
December 31, 2003 $220.0 million
March 31, 2004 $220.0 million
June 30, 2004 $220.0 million
September 30, 2004 $230.0 million
December 31, 2004 $230.0 million
March 31, 2005 $230.0 million
June 30, 2005 $230.0 million
September 30, 2005 $240.0 million
December 31, 2005 $240.0 million
March 31, 2006 $240.0 million
June 30, 2006 $240.0 million
September 30, 2006 and each $250.0 million
fiscal quarter ended thereafter
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SECTION 6.11 Maximum Total Leverage Ratio. For each Rolling
Four Quarters period ending on the dates indicated below, permit the Total
Leverage Ratio to be more than the corresponding ratio below:
Period Ended Ratio
------------ -----
December 31, 2001 3.50:1
March 31, 2002 3.50:1
June 30, 2002 3.50:1
September 30, 2002 3.25:1
December 31, 2002 3.25:1
March 31, 2003 3.25:1
June 30, 2003 3.25:1
September 30, 2003 and each 3.00:1
fiscal quarter ended thereafter
provided, that from and after the closing date of the APS Acquisition,
commencing with the first Rolling Four Quarter test period set forth above
ending after such closing date, the numerator of each ratio set forth above for
each such Rolling Four Quarter test period shall be increased by 0.15.
SECTION 6.12 Maximum Senior Leverage Ratio. For each Rolling
Four Quarters period ending on the dates indicated below, permit the Senior
Leverage Ratio to be more than the corresponding ratio set forth below:
Period Ended Ratio
------------ -----
December 31, 2001 2.25:1
March 31, 2002 2.25:1
June 30, 2002 2.25:1
September 30, 2002 2.25:1
December 31, 2002 2.25:1
March 31, 2003 2.25:1
June 30, 2003 2.25:1
September 30, 2003 and each 2.00:1
fiscal quarter ended thereafter
99
provided, that from and after the closing date of the APS Acquisition,
commencing with the first Rolling Four Quarter test period set forth above
ending after such closing date, the numerator of each ratio set forth above for
each such Rolling Four Quarter test period shall be increased by 0.15.
SECTION 6.13 Minimum Consolidated Fixed Charge Coverage Ratio.
For each Rolling Four Quarters period ending on the dates indicated below,
permit the Consolidated Fixed Charge Coverage Ratio to be less than the
corresponding ratio set forth below:
Period Ended Ratio
------------ -----
December 31, 2001 2.00:1
March 31, 2002 2.00:1
June 30, 2002 2.00:1
September 30, 2002 2.10:1
December 31, 2002 2.10:1
March 31, 2003 2.10:1
June 30, 2003 2.10:1
September 30, 2003 and each 2.25:1
fiscal quarter ended thereafter
SECTION 6.14 Minimum Consolidated Net Worth. Permit
Consolidated Net Worth at any time to be less than $750,000,000 as of the close
of the fiscal year ending September 30, 2001 (the "First Fiscal Year") and, as
of the close of each fiscal year thereafter, the sum of (i) $750,000,000 plus
(ii) 50% of Consolidated Net Income (to the extent a positive number) of the
Borrower and its Consolidated Subsidiaries for each of the fiscal years ending
after the First Fiscal Year.
SECTION 6.15 Transactions with Affiliates. Enter into any
transaction with, or make any payment to, any of its Affiliates that is less
favorable to such Credit Party or of any such Credit Party's Subsidiaries than
would have been the case if such transaction had been effected on an arms-length
basis with a Person other than an Affiliate except that (a) the Borrower may
enter into transactions with its Subsidiaries that are Credit Parties and (b)
Subsidiaries of the Borrower that are Credit Parties may enter into transactions
with other Subsidiaries of the Borrower that are Credit Parties.
SECTION 6.16 Business Activities. Engage in any business
activities other than owning, leasing and operating any healthcare related
facility, unit, operation or business supplying healthcare services, supplies or
products, including long-term care, rehabilitation therapy, specialized health
care, health care management, and pharmacies.
SECTION 6.17 Joint Ventures or Partnerships. Enter into any
Joint Venture or partnership (including, without limitation, by way of selling
the capital stock or other equity interests of a Subsidiary) unless (a) any
interest received by a Credit Party in such Joint Venture or partnership is
pledged to the Collateral Agent (for the benefit of the Secured Parties)
pursuant hereto and (b) the Borrower shall have prepaid the Loans hereunder as
required by Section 2.11(c) hereof.
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SECTION 6.18 Receivables. Sell, discount or otherwise dispose
of Receivables owing to any Credit Party or any Subsidiary of a Credit Party
except (i) for purposes of collection in the ordinary course of business or (ii)
in connection with the sale of the related Credit Party, Subsidiary or Real
Property Asset to the extent not prohibited under Section 6.7 hereof.
SECTION 6.19 Sale and Leaseback. Enter into any arrangement
with any Person or Persons, whereby in contemporaneous transactions any Credit
Party or any Subsidiary of a Credit Party sells essentially all of its right,
title and interest in an asset and, in connection therewith, acquires, leases or
licenses back the right to use such asset, except to the extent the asset
subject to such sale and leaseback arrangement was sold by the applicable Credit
Party or Subsidiary of a Credit Party in a transaction permitted by Section 6.7
hereof and leased by the applicable Credit Party or Subsidiary in a transaction
permitted under Section 6.6 hereof.
SECTION 6.20 Changes to Credit and Collection Policy and
Material Agreements.
(a) Make any material change in its Credit and Collection
Policy which in the reasonable opinion of the Collateral Agent and/or the
Collateral Monitoring Agent would adversely affect the collection of
Receivables.
(b) Consent to any modification or waiver of any material
agreement listed on Schedule 3.17(b) hereto if such modification or waiver would
have a Material Adverse Effect with respect to the Credit Parties. The Borrower
will not consent to the assignment by any other party to any material agreement
of any rights, obligations or interests of such party thereunder except as
expressly permitted by any such material agreement.
(c) Amend the articles of incorporation or by-laws of any
Credit Party in any manner which could be reasonably expected to have a Material
Adverse Effect.
(d) Except to the extent permitted under the Intercreditor
Agreement, make any material amendment or modification to the Rollover Note
Indenture without the prior written consent of Required Lenders.
SECTION 6.21 ERISA Compliance. Engage in a "prohibited
transaction," as defined in Section 406 of ERISA or Section 4975 of the Code,
with respect to any Plan or Multiemployer Plan or knowingly consent to any
"party in interest" or any "disqualified person", as such terms are defined in
Section 3(14) or ERISA and Section 4975(e)(2) of the Code, respectively,
engaging in any "prohibited transaction", with respect to any Plan or
Multiemployer Plan; or permit any Plan to incur any "accumulated funding
deficiency", as defined in Section 302 of ERISA or Section 412 of the Code; or
terminate any Plan in a manner which could result in the imposition of a Lien on
any property of any Credit Party, any Subsidiary of a Credit Party or any ERISA
Affiliate pursuant to Section 4068 of ERISA; or breach or knowingly permit any
employee or officer or any trustee or administrator of any Plan to breach any
fiduciary responsibility imposed under Title I of ERISA with respect to any
Plan; engage in any transaction which would result in the incurrence of a
liability under Section 4069 of ERISA; or fail to make contributions to a Plan
or Multiemployer Plan which could result in the imposition of a Lien on any
property of any Credit Party, any Subsidiary of a Credit Party or any ERISA
Affiliate pursuant to Section 302(f) of ERISA or Section 412(n) of the Code, if
the occurrence of any of the foregoing events (alone or in the aggregate) would
result in a liability which has a Material Adverse Effect.
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SECTION 6.22 Hazardous Materials. Cause or permit any of its
properties or assets to be used to generate, manufacture, refine, transport,
treat, store, handle, dispose, transfer, produce or process Hazardous Materials,
except in compliance with all applicable Environmental Laws; nor release,
discharge, dispose of or permit or suffer any release or disposal as a result of
any intentional act or omission on its part of Hazardous Materials onto any such
property or asset in violation of any Environmental Law or in a manner that
could result in liability under any Environmental Law, except as are not
reasonably likely to have a Material Adverse Effect.
SECTION 6.23 Use of Proceeds of Loans.
(a) Use the proceeds of Revolving Credit Loans hereunder other
than for the purposes set forth in, and as required by, Sections 2.1(b), 2.2(b)
and 2.3(b) hereof.
(b) Use, directly or indirectly, the proceeds of any Loan
hereunder for the purpose (whether immediate, incidental or ultimate) of buying
or carrying any Margin Stock.
SECTION 6.24 Fiscal Year; Fiscal Quarter. Change its fiscal
year or any of its fiscal quarters without the consent of the Required Lenders.
7. EVENTS OF DEFAULT
In the case of the happening and during the continuance of any
of the following events (herein called "Events of Default"):
(a) any representation, warranty, certification or statement
made by a Credit Party in this Credit Agreement or any other Fundamental
Document to which it is a party or in connection with this Credit Agreement or
any Fundamental Document or any statement or representation made by or on behalf
of any Credit Party in any report, financial statement, certificate or other
document furnished to any of the Agents, the Issuing Bank, any Lender or any
other Secured Party pursuant to, or in connection with, this Credit Agreement or
any other Fundamental Document, shall prove to have been false or misleading in
any material respect when made or delivered;
(b) default shall be made in the payment of principal of any
of the Loans as and when due and payable, whether at the due date thereof, by
reason of maturity, mandatory prepayment, acceleration or otherwise;
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(c) default shall be made in the payment of interest on the
Loans, the Fees, the Letter of Credit Fees or other amounts payable to any of
the Agents, the Issuing Bank or a Lender under this Credit Agreement, under any
Interest Rate Protection Agreement or under the fee letter with respect to any
Letter of Credit or under any of the Fee Letters, when and as the same shall
become due and payable, whether at the due date thereof or at a date fixed for
prepayment thereof or by acceleration thereof or otherwise and such default
shall continue unremedied for two (2) Business Days;
(d) default shall be made in the due observance or performance
of any covenant, condition or agreement contained in Sections 5.1 (other than
5.1(h) and 5.1(k)), 5.4(a), 5.5(a), 5.14, 5.18 or Article 6 of this Credit
Agreement;
(e) default shall be made by any Credit Party in the due
observance or performance of Sections 5.1(h) or 5.1(k) of the Credit Agreement,
and such default shall continue unremedied for ten (10) days;
(f) default shall be made by any Credit Party in the due
observance or performance of any other covenant, condition or agreement to be
observed or performed pursuant to the terms of this Credit Agreement or any
other Fundamental Document (other than those covered by paragraphs (a), (b),
(c), (d) or (e) of this Article 7), and such default shall continue unremedied
for thirty (30) days after a Credit Party receives written notice or obtains
knowledge of such occurrence;
(g) default shall be made with respect to payment of the
Rollover Notes or any other event of default shall occur under the Rollover Note
Indenture;
(h) default shall be made with respect to any payment, when
due, of any Indebtedness in excess of $2,500,000 (other than the Obligations and
the Rollover Notes) of any Credit Party or any Subsidiary of a Credit Party, or
any other default shall occur, if the effect of such non-payment default is to
accelerate the maturity of such Indebtedness or to permit the holder thereof to
cause such Indebtedness to become due prior to its stated maturity, and such
default shall not be remedied, cured, waived or consented to within the period
of grace with respect thereto, or any other circumstance which arises (other
than the mere passage of time) by reason of which any Credit Party or any
Subsidiary of a Credit Party (as applicable) is required to repurchase or offer
to holders of Indebtedness of any such Person, the opportunity to have
repurchased, any such Indebtedness; or any such Indebtedness shall become or be
declared to be due and payable prior to its stated maturity;
(i) any Credit Party or any Subsidiary of a Credit Party shall
generally not pay its debts as they become due or shall admit in writing its
inability to pay its debts, or shall make a general assignment for the benefit
of creditors; or any Credit Party or any Subsidiary of a Credit Party shall
commence any case, proceeding or other action seeking to have an order for
relief entered on its behalf as a debtor or to adjudicate it a bankrupt or
insolvent or seeking reorganization, arrangement, adjustment, liquidation,
dissolution or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors or seeking
appointment of a receiver, trustee, custodian or other similar official for it
or for all or any substantial part of its property or shall file an answer or
other pleading in any such case, proceeding or other action admitting the
material allegations of any petition, complaint or similar pleading filed
against it or consenting to the relief sought therein; or any Credit Party or
any Subsidiary of a Credit Party shall take any action to authorize, or in
contemplation of, any of the foregoing;
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(j) any involuntary case, proceeding or other action against
any Credit Party or any Subsidiary of a Credit Party shall be commenced seeking
to have an order for relief entered against it as debtor or to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its debts under any law
relating to bankruptcy, insolvency, reorganization or relief of debtors, or
seeking appointment of a receiver, trustee, custodian or other similar official
for it or for all or any substantial part of its property, and such case,
proceeding or other action (i) results in the entry of any order for relief
against it or (ii) shall remain undismissed for a period of sixty (60) days;
(k) one or more judgment(s) for the payment of money in excess
of $5,000,000 in the aggregate (other than a judgment as to which, and only to
the extent, a reputable insurance company has acknowledged coverage of such
claim in writing) shall be rendered against any Credit Party or any Subsidiary
of a Credit Party and either (i) within thirty (30) days from the entry of such
judgment, shall not have been discharged or stayed pending appeal, or shall not
have been discharged within thirty (30) days from the entry of a final order of
affirmance on appeal or (ii) enforcement proceedings shall be commenced by any
creditor on any such judgment;
(l) (i) failure by any Credit Party or ERISA Affiliate to make
any contributions required to be made to a Plan subject to Title IV of ERISA or
a Multiemployer Plan, (ii) any accumulated funding deficiency (within the
meaning of Section 4971(c) of the Code) shall exist with respect to any Plan
(whether or not waived), (iii) failure by any Plan to satisfy the minimum
funding standard required for any plan year or part thereof under Section 412 of
the Code or Section 302 of ERISA or a waiver of such standard or an extension of
any amortization period is sought or granted under Section 412 of the Code or
Section 303 or 304 of ERISA, (iv) any Credit Party or ERISA Affiliate shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred
withdrawal liability to such Multiemployer Plan, or that a Multiemployer Plan is
in reorganization or is being terminated, (v) a Reportable Event with respect to
a Plan shall have occurred, (vi) the withdrawal by any Credit Party or ERISA
Affiliate from a Plan during a plan year in which it was a substantial employer
(within the meaning of Section 4001(a)(2) or 4062(e) of ERISA), (vii) the
termination of a Plan, or the filing of a notice of intent to terminate a Plan
under Section 4041(c) of ERISA, (viii) the institution of proceedings to
terminate, or the appointment of a trustee with respect to, a Plan by the PBGC,
(ix) any other event or condition which could constitute grounds under Section
4042(a) of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or (x) the imposition of a Lien pursuant to Section 412 of
the Code or Section 302 of ERISA as to any Credit Party or ERISA Affiliate; and
the occurrence of any of the foregoing events, individually or in the aggregate,
could reasonably be expected to result in a liability in excess of $1,000,000;
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(m) any Credit Party or any Subsidiary of any Credit Party is
liable for a violation or liability under any Environmental Law which is
reasonably likely to have a Material Adverse Effect;
(n) (i) this Credit Agreement, any Mortgage, or any other
Fundamental Document shall, for any reason, not be or shall cease to be in full
force and effect or shall be declared null and void or any of the Fundamental
Documents shall not give or shall cease to give the Collateral Agent the Liens,
rights, powers and privileges purported to be created thereby in favor of the
Collateral Agent for the benefit of the Secured Parties, superior to and prior
to the rights of all third Persons and subject to no other Liens (other than
Permitted Liens), or (ii) the validity or enforceability of the Liens granted,
to be granted, or purported to be granted, by any of the Fundamental Documents
shall be contested by any Credit Party or any of their respective Affiliates;
(o) a Change in Control shall occur and shall not have been
consented to by the Required Lenders;
(p) at any time, for any reason, any Credit Party shall
repudiate, or seek to repudiate, any of its Obligations under any Fundamental
Document to which it is a party;
(q) there shall be any revocations, suspensions, terminations,
recessions, non-renewals or forfeitures or similar actions with respect to one
or more Regulatory Licenses or Reimbursement Approvals, which individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect;
and
(r) there shall be any termination of or default under any
Management Agreement which could reasonably be expected to have a Material
Adverse Effect;
then, in every such event and at any time thereafter during the continuance of
such event, the Administrative Agent may, and if directed by the Required
Lenders shall, take any or all of the following actions, at the same or
different times: (x) terminate forthwith the Commitments and/or (y) declare the
principal of and the interest on the Loans and the notes evidencing the Loans
hereunder and all other amounts payable hereunder or thereunder to be forthwith
due and payable, whereupon the same shall become and be forthwith due and
payable, without presentment, demand, protest, notice of acceleration or other
notice of any kind, all of which are hereby expressly waived, anything in this
Credit Agreement or in any note evidencing any Loan hereunder to the contrary
notwithstanding and/or (z) require the Borrower to deliver to the Administrative
Agent from time to time cash or Cash Equivalents in an amount equal to 105% of
the amount of the L/C Exposure or to furnish other security therefor acceptable
to the Issuing Bank and the Required Revolving Credit Lenders. If an Event of
Default specified in paragraphs (i) or (j) above shall have occurred, the
Commitments shall automatically terminate and the principal of, and interest on,
the Loans and the notes evidencing the Loans hereunder and all other amounts
payable hereunder and thereunder shall automatically become due and payable
without presentment, demand, protest, or other notice of any kind, all of which
are hereby expressly waived, anything in this Credit Agreement or any note
evidencing any Loan hereunder to the contrary notwithstanding. Such remedies
shall be in addition to any other remedy available to any of the Secured Parties
pursuant to Applicable Law or otherwise.
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8. GRANT OF SECURITY INTEREST; REMEDIES
SECTION 8.1 Security Interests. The Borrower, as security for
the due and punctual payment of the Obligations (including interest accruing on
and after the filing of any petition in bankruptcy or of reorganization of the
Borrower whether or not post filing interest is allowed in such proceeding) and
each of the Guarantors, as security for its obligations under Article 9 hereof,
hereby mortgage, pledge, assign, transfer, set over, convey and deliver to the
Collateral Agent (for the benefit of the Secured Parties) and grant to the
Collateral Agent (for the benefit of the Secured Parties) a security interest in
the Collateral; provided, however, that the Credit Parties grant a security
interest unto the Collateral Agent (for the benefit of the Secured Parties) in
their right, title and interest in, to and under their Rights in Government
Receivables only to the extent that such grant of a security interest is not
prohibited by non-waivable provisions of Applicable Law, but the terms of this
proviso shall not affect the Credit Parties' grant and creation of a Lien on
Rights in Government Receivables in favor of the Collateral Agent (for the
benefit of the Secured Parties).
SECTION 8.2 Use of Collateral. So long as no Event of Default
shall have occurred and be continuing, and subject to the various provisions of
this Credit Agreement and the other Fundamental Documents, a Credit Party may
use the Collateral in any lawful manner except as otherwise provided hereunder.
SECTION 8.3 Cash Management System.
(a) The Credit Parties shall at all times maintain in all
material respects their current cash management system as in effect as of the
date hereof or cause to be maintained another cash management system reasonably
acceptable to the Collateral Agent.
(b) The Credit Parties shall promptly transfer or cause to be
transferred all funds arising from the collection of Receivables other than
Medicare Receivables to one or more of the Concentration Accounts set forth on
Schedule 8.3(b) hereto.
(c) The Credit Parties shall promptly transfer or cause to be
transferred all funds arising from the collection of Medicare Receivables to one
or more of the Medicare Receivable Concentration Accounts set forth on Schedule
8.3(c).
(d) So long as no Event of Default shall have occurred and be
continuing, the Credit Parties shall have free access to the funds in the
Concentration Accounts and the Government Receivable Concentration Accounts.
Upon the occurrence and during the continuation of an Event of Default, the
Collateral Agent (for the benefit of the Secured Parties), subject to Applicable
Law, shall have the right to establish sole dominion and control over the
Concentration Accounts and each Government Receivable Collection Accounts, and
the balances in such accounts shall be applied toward the payment of the
Obligations.
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(e) Within 45 days after the Closing Date, the Borrower shall
deliver to the Collateral Agent an account control agreement or a blocked
account agreement (in form and substance satisfactory to the Collateral Agent)
with respect to each Concentration Account and the Government Receivable
Concentration Account, duly executed by the applicable Credit Party and the
financial institution where such account is maintained.
SECTION 8.4 Credit Parties to Hold in Trust. Upon the
occurrence and during the continuance of an Event of Default, each of the Credit
Parties will, upon receipt by it of any revenue, income, profits or other sums
in which a security interest is granted by this Article 8, payable pursuant to
any agreement or otherwise, or of any check, draft, note, trade acceptance or
other instrument evidencing an obligation to pay any such sum, hold the sum or
instrument in trust for the Collateral Agent, segregate such sum or instrument
from their own assets and forthwith, without any notice, demand or other action
whatsoever (all notices, demands, or other actions on the part of any of the
Agents or any other Secured Party being expressly waived), endorse, transfer and
deliver any such sums or instruments or both, to the Collateral Agent to be
applied to the repayment of the Obligations in accordance with the provisions of
Section 8.7 hereof.
SECTION 8.5 Collections, etc. Upon the occurrence and during
the continuance of an Event of Default, the Collateral Agent may, in its sole
discretion, except as prohibited or restricted by Applicable Law in the case of
Government Receivables, in its name (on behalf of the Secured Parties) or in the
name of any Credit Party or otherwise, demand, sue for, collect or receive any
money or property at any time payable or receivable on account of or in exchange
for, or make any compromise or settlement deemed desirable with respect to, any
of the Collateral, but shall be under no obligation so to do, or the Collateral
Agent may extend the time of payment, arrange for payment in installments, or
otherwise modify the terms of, or release, any of the Collateral, without
thereby incurring responsibility to, or discharging or otherwise affecting any
liability of, any Credit Party. The Collateral Agent will not be required to
take any steps to preserve any rights against prior parties to the Collateral.
If any Credit Party fails to make any payment or take any action required
hereunder, the Collateral Agent may, except to the extent prohibited by
Applicable Law with respect to Government Receivables, make such payments and
take all such actions as the Collateral Agent reasonably deems necessary to
protect the Collateral Agent's (on behalf of the Secured Parties) security
interests in the Collateral and/or the value thereof, and the Collateral Agent
is hereby authorized (without limiting the general nature of the authority
herein above conferred), except to the extent prohibited by Applicable Law with
respect to Government Receivables, to pay, purchase, contest or compromise any
Liens that in the judgment of the Collateral Agent appear to be equal to, prior
to or superior to the security interests of the Collateral Agent (on behalf of
the Secured Parties) in the Collateral and any Liens not expressly permitted by
this Credit Agreement.
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SECTION 8.6 Possession, Sale of Collateral, etc. Upon the
occurrence and during the continuance of an Event of Default, the Collateral
Agent may lawfully enter upon the premises of any Credit Party or wherever the
Collateral may be, and take possession of the Collateral, and may demand and
receive such possession from any Person who has possession thereof, and the
Collateral Agent may take such measures as it deems necessary or proper for the
care or protection thereof, including the right to remove all or any portion of
the Collateral, and with or without taking such possession may sell or cause to
be sold, whenever the Collateral Agent shall decide, in one or more sales or
parcels, at such prices as the Collateral Agent may deem appropriate, and for
cash or on credit or for future delivery, without assumption of any credit risk,
all or any portion of the Collateral, at any broker's board or at public or
private sale, with ten (10) days' written notice to the Credit Parties of the
time and place of any such public sale or sales (which notice the Credit Parties
hereby agree is reasonable) and with such other notices as may be required by
Applicable Law and cannot be waived, and neither the Agents, the Issuing Bank,
the Lenders nor any other Secured Party shall have any liability should the
proceeds resulting from a private sale be less than the proceeds realizable from
a public sale, and the Agents, the Issuing Bank, the Lenders, any other Secured
Party or any other Person may be the purchaser of all or any portion of the
Collateral so sold and thereafter hold the same absolutely, free (to the fullest
extent permitted by Applicable Law) from any claim or right of whatever kind,
including any equity of redemption, of any Credit Party, any such demand,
notice, claim, right or equity being hereby expressly waived and released. At
any sale or sales made pursuant to this Article 8, the Agents, the Issuing Bank,
the Lenders and the other Secured Parties may bid for or purchase, free (to the
fullest extent permitted by Applicable Law) from any claim or right of whatever
kind, including any equity of redemption, of any Credit Party, any such demand,
notice, claim, right or equity being hereby expressly waived and released, any
part of or all of the Collateral offered for sale, and may make any payment on
account thereof by using any claim for moneys then due and payable to the
Agents, the Issuing Bank, the Lenders and the other Secured Parties by any
Credit Party hereunder as a credit against the purchase price. The Agents, the
Issuing Bank, the Lenders and the other Secured Parties shall in any such sale
make no representations or warranties with respect to the Collateral or any part
thereof, and neither the Agents, the Issuing Bank, the Lenders nor any other
Secured Party shall be chargeable with any of the obligations or liabilities of
any Credit Party. Each Credit Party hereby agrees (i) that it will indemnify and
hold the Agents, the Issuing Bank, the Lenders and any other Secured Party
harmless from and against any and all claims with respect to the Collateral
asserted before the taking of actual possession or control of the relevant
Collateral by the Collateral Agent, the Issuing Bank, the Lenders or any other
Secured Party pursuant to this Article 8, or arising out of any act of, or
omission to act on the part of, such Person (other than the Agents, the Issuing
Bank, the Lenders and any other Secured Party) prior to such taking of actual
possession or control by such Secured Party (whether asserted before or after
such taking of possession or control), or arising out of any act on the part of
any Credit Party or its Affiliates or agents before or after the commencement of
such actual possession or control by such Secured Party; and (ii) neither the
Agents, the Issuing Bank, the Lenders, nor any other Secured Party shall have
any liability or obligation to any Credit Party arising out of any such claim
except for acts of willful misconduct or gross negligence as determined by a
final order or judgment of a court of competent jurisdiction. In any action
hereunder, the Agents, the Issuing Bank, the Lenders and any other Secured Party
shall be entitled if permitted by Applicable Law to the appointment of a
receiver without notice, to take possession of all or any portion of the
Collateral and to exercise such powers as the court shall confer upon the
receiver. Notwithstanding the foregoing, upon the occurrence of an Event of
Default, and during the continuation of such Event of Default, any Agent, the
Issuing Bank, any Lender and/or any other Secured Party shall be entitled to
apply, without prior notice to any of the Credit Parties, any cash or cash items
constituting Collateral in the possession of such Secured Party to payment of
the Obligations.
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SECTION 8.7 Application of Proceeds on Default. Subject to the
provisions of the Intercreditor Agreement, upon the occurrence and during the
continuance of an Event of Default, the balance in any account of any Credit
Party with a Lender, all other income on the Collateral, and all proceeds from
any sale of the Collateral pursuant hereto shall be applied first toward payment
of the reasonable out-of-pocket costs and expenses paid or incurred by any Agent
in enforcing this Credit Agreement, in realizing on or protecting any Collateral
and in enforcing or collecting any Obligations or any Guaranty thereof,
including, without limitation, court costs, reasonable attorney's fees and
expenses and reasonable financial consultants' fees incurred by any Agent and
then to the indefeasible payment in full in cash of the Obligations in
accordance with Section 12.2(b) hereof. Any amounts remaining after such
indefeasible payment in full shall be remitted to the appropriate Credit Party
or as a court of competent jurisdiction may otherwise direct.
SECTION 8.8 Power of Attorney. Upon the occurrence and during
the continuance of an Event of Default which is not waived in writing by the
Required Lenders, (a) each Credit Party does hereby irrevocably make, constitute
and appoint the Collateral Agent or any of its officers or designees its true
and lawful attorney-in-fact with full power in the name of the Collateral Agent,
such other Person or such Credit Party to receive, open and dispose of all mail
addressed to any Credit Party, and to endorse any notes, checks, drafts, money
orders or other evidences of payment relating to the Collateral that may come
into the possession of the Collateral Agent with full power and right to cause
the mail of such Persons to be transferred to the Collateral Agent's own offices
or otherwise, and to do any and all other acts necessary or proper to carry out
the intent of this Credit Agreement and the grant of the security interests
hereunder and under the Fundamental Documents, and each Credit Party hereby
ratifies and confirms all that the Collateral Agent or its substitutes shall
properly do by virtue hereof; and (b) each Credit Party does hereby further
irrevocably make, constitute and appoint the Collateral Agent or any of its
officers or designees its true and lawful attorney-in-fact in the name of the
Collateral Agent, such other Person or such Credit Party (i) to enforce all of
such Credit Party's rights under and pursuant to all agreements with respect to
the Collateral, all for the sole benefit of the Collateral Agent (for the
benefit of the Secured Parties), (ii) to enter into and perform such agreements
as may be necessary in order to carry out the terms, covenants and conditions of
the Fundamental Documents that are required to be observed or performed by any
Credit Party, (iii) to execute such other and further mortgages, pledges and
assignments of the Collateral, and related instruments or agreements, as the
Collateral Agent may reasonably require for the purpose of perfecting,
protecting, maintaining or enforcing the security interests granted to the
Collateral Agent for the benefit of the Secured Parties hereunder and under the
other Fundamental Documents, and (iv) to do any and all other things necessary
or proper to carry out the intention of this Credit Agreement and the grant of
the security interests hereunder and under the other Fundamental Documents. Each
of the Credit Parties hereby ratifies and confirms in advance all that the
Collateral Agent as such attorney-in-fact or its substitutes shall properly do
by virtue of this power of attorney in accordance with the terms hereof.
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SECTION 8.9 Financing Statements, Direct Payments. Each Credit
Party hereby authorizes the Collateral Agent to file UCC financing statements
and any amendments thereto or continuations thereof and any other appropriate
security documents or instruments and to give any notices necessary or desirable
to perfect the Lien of the Collateral Agent (for the benefit of the Secured
Parties) on the Collateral, in all cases without the signature of any Credit
Party or to execute such items as attorney-in-fact for any Credit Party;
provided, that the Collateral Agent shall provide copies of any such documents
or instruments to the Borrower. Each Credit Party further authorizes the
Collateral Agent upon the occurrence of a default under Article 7(b) or Article
7(c) hereof, and during the continuation of any such default, to notify any
account debtors or tenants that all sums payable to any Credit Party relating to
the Collateral shall be paid directly to the Collateral Agent.
SECTION 8.10 Further Assurances. Upon the request of the
Collateral Agent, each Credit Party hereby agrees to duly and promptly execute
and deliver, or cause to be duly executed and delivered, at the cost and expense
of the Credit Parties, such further instruments as may be necessary or proper,
in the reasonable judgment of the Collateral Agent, to carry out the provisions
and purposes of this Article 8 or to perfect and preserve the Liens of the
Collateral Agent for the benefit of the Secured Parties hereunder and under the
Fundamental Documents, in the Collateral or any portion thereof.
SECTION 8.11 Termination and Release. The security interests
granted under this Article 8 shall terminate on the Facility Termination Date.
Upon request by the Credit Parties (and at the sole expense of the Credit
Parties) after such termination, the Collateral Agent will take all reasonable
action and do all things reasonably necessary, including executing UCC
termination statements, to terminate the security interest granted to it (for
the benefit of the Secured Parties) hereunder. Upon the written request of the
Credit Parties, the Collateral Agent shall at the sole cost and expense of the
applicable Credit Party release its security interest (i) in all personal
property located in or appurtenant to a leased Real Property Asset upon the
expiration or termination without renewal of the lease for such Real Property
Asset and (ii) in any Collateral sold, transferred or otherwise disposed of by
any Credit Party to the extent such sale, transfer or other disposition is
permitted by and made in accordance with the terms of this Agreement.
SECTION 8.12 Remedies Not Exclusive. The remedies conferred
upon or reserved to the Collateral Agent in this Article 8 are intended to be in
addition to, and not in limitation of, any other remedy or remedies available to
the Collateral Agent. Without limiting the generality of the foregoing, the
Collateral Agent, the other Agents, the Issuing Bank, the Lenders and any other
Secured Party shall have all rights and remedies of a secured creditor under
Article 9 of the UCC and under any other Applicable Law.
SECTION 8.13 Continuation and Reinstatement. Each Credit Party
further agrees that the security interest granted hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment or any
part thereof of any Obligation is rescinded or must otherwise be restored by any
Agent, the Issuing Bank, any Lender or any other Secured Party upon the
bankruptcy or reorganization of any Credit Party or otherwise.
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9. GUARANTY
SECTION 9.1 Guaranty. (a) Each Guarantor unconditionally and
irrevocably guarantees to the Secured Parties the due and punctual payment by,
and performance of, the Obligations (including interest accruing on and after
the filing of any petition in bankruptcy or of reorganization of the obligor
whether or not post filing interest is allowed in such proceeding). Each
Guarantor further agrees that the Obligations may be increased, extended or
renewed, in whole or in part, without notice or further assent from it (except
as may be otherwise required herein), and it will remain bound upon this
Guaranty notwithstanding any extension or renewal of any Obligation.
(b) Each Guarantor waives presentation to, demand for payment
from and protest to, as the case may be, any Credit Party or any other guarantor
of any of the Obligations, and also waives notice of protest for nonpayment,
notice of acceleration and notice of intent to accelerate. The obligations of
each Guarantor hereunder shall not be affected by (i) the failure of any Agent,
the Issuing Bank, any Lender or any other Secured Party to assert any claim or
demand or to enforce any right or remedy against the Borrower or any Guarantor
or any other guarantor under the provisions of this Credit Agreement or any
other agreement or otherwise; (ii) any extension or renewal of any provision
hereof or thereof; (iii) the failure of any Agent, the Issuing Bank, any Lender
or any other Secured Party to obtain the consent of the Guarantor with respect
to any rescission, waiver, compromise, acceleration, amendment or modification
of any of the terms or provisions of this Credit Agreement, any notes evidencing
any of the Loans hereunder or of any other Fundamental Document or other
agreement; (iv) the release, exchange, waiver or foreclosure of any security
held by the Collateral Agent for the Obligations or any of them; (v) the failure
of any Agent, the Issuing Bank, any Lender or any other Secured Party to
exercise any right or remedy against any other Guarantor or any other guarantor
of the Obligations; or (vi) the release or substitution of any Guarantor or
guarantor.
(c) Each Guarantor further agrees that this Guaranty
constitutes a guaranty of performance and of payment when due and not just of
collection, and waives any right to require that any resort be had by any Agent,
the Issuing Bank, any Lender or any other Secured Party to any security held for
payment of the Obligations or to any balance of any deposit, account or credit
on the books of any Agent, the Issuing Bank, any Lender or any other Secured
Party in favor of the Borrower or any Guarantor, or to any other Person.
(d) Each Guarantor hereby expressly assumes all
responsibilities to remain informed of the financial condition of the Borrower,
the Guarantors and any other guarantors and any circumstances affecting the
Collateral or the Real Property Assets or the Pledged Securities or the ability
of the Borrower to perform under this Credit Agreement.
(e) Each Guarantor's obligations under the Guaranty shall not
be affected by the genuineness, validity, regularity or enforceability of the
Obligations, any notes evidencing any of the Loans hereunder or any other
instrument evidencing any Obligations, or by the existence, validity,
enforceability, perfection, or extent of any Lien on any Collateral or Real
Property Asset or Pledged Collateral securing any Obligation or by any other
circumstance relating to the Obligations which might otherwise constitute a
defense to this Guaranty. None of the Agents, the Issuing Bank, any of the
Lenders nor any other Secured Party make any representation or warranty with
respect to any such circumstances or have any duty or responsibility whatsoever
to any Guarantor in respect to the management and maintenance of the Obligations
or any collateral security for the Obligations.
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SECTION 9.2 No Impairment of Guaranty, etc. The obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (except indefeasible payment and
performance in full in cash of the Obligations), including, without limitation,
any claim of waiver, release, surrender, alteration or compromise, and shall not
be subject to any defense or set-off, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations or otherwise. Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder shall not be discharged or impaired or
otherwise affected by the failure of any Agent, the Issuing Bank, any Lender or
any other Secured Party to assert any claim or demand or to enforce any remedy
under this Credit Agreement or any other Fundamental Document or other
agreement, by any waiver or modification of any provision hereof or thereof, by
any default, failure or delay, willful or otherwise, in the performance of the
Obligations, or by any other act or thing or omission or delay to do any other
act or thing which may or might in any manner or to any extent vary the risk of
such Guarantor or would otherwise operate as a discharge of such Guarantor as a
matter of law, unless and until the Facility Termination Date.
SECTION 9.3 Continuation and Reinstatement, etc. (a) Each
Guarantor further agrees that its Guaranty hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
any Agent, the Issuing Bank, any Lender or any other Secured Party upon the
bankruptcy or reorganization of Borrower or a Guarantor, or otherwise. In
furtherance of the provisions of this Article 9, and not in limitation of any
other right which any Agent, the Issuing Bank, any Lender or any other Secured
Party may have at law or in equity against the Borrower, a Guarantor or any
other Person by virtue hereof, upon failure of the Borrower to pay any
Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice or otherwise, each Guarantor hereby promises to and
will, upon receipt of written demand by any Agent, the Issuing Bank, any Lender
or any other Secured Party, forthwith pay or cause to be paid to the Collateral
Agent for the benefit of the Secured Parties (as applicable) in cash an amount
equal to the unpaid amount of all the Obligations with interest thereon at a
rate of interest equal to the rate specified in Section 2.13(a) hereof, and
thereupon the Collateral Agent shall assign such Obligation, together with all
security interests, if any, then held by the Collateral Agent in respect of such
Obligation, to the Guarantors making such payment; such assignment to be
subordinate and junior to the rights of the Collateral Agent on behalf of the
Secured Parties with regard to amounts payable by the Borrower in connection
with the remaining unpaid Obligations (including interest accruing on and after
the filing of any petition in bankruptcy or of reorganization of an obligor
whether or not post filing interest is allowed in such proceeding) and to be pro
tanto to the extent to which the Obligation in question was discharged by the
Guarantor or Guarantors making such payments.
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(b) All rights of a Guarantor against the Borrower, arising as
a result of the payment by such Guarantor of any sums to the Collateral Agent
for the benefit of the Secured Parties or directly to the Secured Parties
hereunder by way of right of subrogation or otherwise, shall in all respects be
subordinated and junior in right of payment to, and shall not be exercised by
such Guarantor until and unless, the prior indefeasible payment in full in cash
of all the Obligations (including interest accruing on and after the filing of
any petition in bankruptcy or of reorganization of an obligor whether or not
post filing interest is allowed in such proceeding). If any amount shall be paid
to such Guarantor for the account of the Borrower, such amount shall be held in
trust for the benefit of the Collateral Agent, segregated from such Guarantor's
own assets, and shall forthwith be paid to the Collateral Agent on behalf of the
Secured Parties to be credited and applied to the Obligations, whether matured
or unmatured.
SECTION 9.4 Limitation on Guaranteed Amount etc.
Notwithstanding any other provision of this Article 9, the amount guaranteed by
each Guarantor hereunder shall be limited to the extent, if any, required so
that its obligations under this Article 9 shall not be subject to avoidance
under Section 548 of the Bankruptcy Code or to being set aside or annulled under
any Applicable Law relating to fraud on creditors. In determining the
limitations, if any, on the amount of any Guarantor's obligations hereunder
pursuant to the preceding sentence, it is the intention of the parties hereto
that any rights of subrogation or contribution which such Guarantor may have
under this Article 9, any other agreement or Applicable Law shall be taken into
account.
10. PLEDGE
SECTION 10.1 Pledge. Each Pledgor, as security for the due and
punctual payment of the Obligations (including interest accruing on and after
the filing of any petition in bankruptcy or of reorganization of the Borrower
whether or not post filing interest is allowed in such proceeding) in the case
of the Borrower and as security for its obligations under Article 9 hereof in
the case of a Pledgor which is a Guarantor, hereby pledges, hypothecates,
assigns, transfers, sets over and delivers unto the Collateral Agent for the
benefit of the Secured Parties, a security interest in all Pledged Collateral
now owned or hereafter acquired by it. The Pledgors shall deliver to the
Collateral Agent the definitive instruments (if any) representing all Pledged
Securities, accompanied by undated stock powers, duly endorsed or executed in
blank by the appropriate Pledgor, and such other instruments or documents as the
Collateral Agent or its counsel shall reasonably request. Each delivery of
securities being pledged hereunder shall be accompanied by a schedule showing a
description of the securities theretofore and then being pledged hereunder. Each
schedule so delivered shall supersede any prior schedules so delivered.
SECTION 10.2 Covenant. Each Pledgor covenants that as
stockholder or partner or member of each of its respective Subsidiaries it will
not take any action to allow any additional shares of common stock, Preferred
Stock or other equity securities or interests of any of its respective
Subsidiaries or any securities convertible or exchangeable into common or
Preferred Stock of such Subsidiaries to be issued, or grant any options or
warrants, unless such securities are pledged to the Collateral Agent (for the
benefit of the Secured Parties) as security for the Obligations.
SECTION 10.3 Registration in Nominee Name; Denominations. Upon
the occurrence or continuation of an Event of Default, the Collateral Agent
shall have the right (in its sole discretion) to hold the certificates
representing any Pledged Securities (a) in its own name (on behalf of itself and
any of the Secured Parties) or in the name of its nominee or (b) in the name of
the appropriate Pledgor, endorsed or assigned in blank or in favor of the
Collateral Agent. Upon the occurrence or continuation of an Event of Default,
the Collateral Agent shall have the right to exchange the certificates
representing any of the Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Credit Agreement.
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SECTION 10.4 Voting Rights; Dividends; etc. (a) The
appropriate Pledgor shall be entitled to exercise any and all voting and/or
consensual rights and powers accruing to an owner of the Pledged Securities
being pledged by it hereunder or any part thereof for any purpose not
inconsistent with the terms hereof, at all times, except as expressly provided
in paragraph (c) below.
(b) All dividends or distributions of any kind whatsoever
(other than (x) cash dividends or (y) distributions expressly permitted by
Section 6.5 hereof) received by a Pledgor, whether resulting from a subdivision,
combination, or reclassification of the outstanding capital stock of the issuer
or received in exchange for Pledged Securities or any part thereof or as a
result of any merger, consolidation, acquisition, or other exchange of assets to
which the issuer may be a party, or otherwise, shall be and become part of the
Pledged Collateral pledged hereunder and shall immediately be delivered to the
Collateral Agent to be held subject to the terms hereof. All dividends and
distributions which are received contrary to the provisions of this subsection
(b) shall be received in trust for the benefit of the Secured Parties,
segregated from such Pledgor's own assets, and shall be delivered to the
Collateral Agent.
(c) Upon the occurrence and during the continuance of an Event
of Default and notice from the Collateral Agent of the transfer of such rights
to the Collateral Agent, all rights of a Pledgor (i) to exercise the voting
and/or consensual rights and powers which it is entitled to exercise pursuant to
this Section 10.4 and (ii) to receive and retain any dividends and
distributions, shall cease, and all such rights shall thereupon become vested in
the Collateral Agent, which shall have the sole and exclusive right and
authority to exercise such voting and/or consensual rights and receive such
dividends and distributions until such time as such Event of Default has been
cured; provided, however, that to the extent any governmental consents or
filings are required for the exercise by the Collateral Agent of any of the
foregoing rights and powers, the Collateral Agent shall refrain from exercising
such rights or powers until the making of such required filings, the receipt of
such consent and the expiration of all related waiting periods.
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SECTION 10.5 Remedies Upon Default. If an Event of Default
shall have occurred and be continuing, the Collateral Agent, on behalf of the
Secured Parties, may sell the Pledged Collateral, or any part thereof, at public
or private sale or at any broker's board or on any securities exchange, for
cash, upon credit or for future delivery as the Collateral Agent shall deem
appropriate subject to the terms hereof or as otherwise provided in the UCC. The
Collateral Agent shall be authorized at any such sale (if it deems it advisable
to do so) to restrict to the full extent permitted by Applicable Law the
prospective bidders or purchasers to Persons who will represent and agree that
they are purchasing the Pledged Collateral for their own account for investment
and not with a view to the distribution or sale thereof, and upon consummation
of any such sale, the Collateral Agent shall have the right to assign, transfer,
and deliver to the purchaser or purchasers thereof the Pledged Collateral so
sold. Each such purchaser at any such sale shall hold the property sold
absolutely, free from any claim or right on the part of any Pledgor. The
Collateral Agent shall give the Pledgors ten (10) days' written notice of any
such public or private sale, or sale at any broker's board or on any such
securities exchange, or of any other disposition of the Pledged Collateral. Such
notice, in the case of public sale, shall state the time and place for such sale
and, in the case of sale at a broker's board or on a securities exchange, shall
state the board or exchange at which such sale is to be made and the day on
which the Pledged Collateral, or portion thereof, will first be offered for sale
at such board or exchange. Any such public sale shall be held at such time or
times within ordinary business hours and at such place or places as the
Collateral Agent may fix and shall state in the notice of such sale. At any such
sale, the Pledged Collateral, or portion thereof, to be sold may be sold in one
lot as an entirety or in separate parcels, as the Collateral Agent may (in its
sole discretion) determine. The Collateral Agent shall not be obligated to make
any sale of the Pledged Collateral if it shall determine not to do so,
regardless of the fact that notice of sale of the Pledged Collateral may have
been given. The Collateral Agent may, without notice or publication, adjourn any
public or private sale or cause the same to be adjourned from time to time by
announcement at the time and place fixed for sale, and such sale may, without
further notice, be made at the time and place to which the same was so
adjourned. In case the sale of all or any part of the Pledged Collateral is made
on credit or for future delivery, the Pledged Collateral so sold shall be
retained by the Collateral Agent until the sale price is paid by the purchaser
or purchasers thereof, but the Collateral Agent shall not incur any liability in
case any such purchaser or purchasers shall fail to take up and pay for the
Pledged Collateral so sold and, in case of any such failure, such Pledged
Collateral may be sold again upon like notice. At any sale or sales made
pursuant to this Section 10.5, the Collateral Agent, any other Agent, the
Issuing Bank, any Lender or any other Secured Party may bid for or purchase,
free from any claim or right of whatever kind, including any equity of
redemption, of the Pledgors, any such demand, notice, claim, right or equity
being hereby expressly waived and released, any or all of the Pledged Collateral
offered for sale, and may make any payment on the account thereof by using any
claim for moneys then due and payable to the Agents, the Issuing Bank, the
Lenders and any other Secured Party by any Credit Party as a credit against the
purchase price; and the Collateral Agent, upon compliance with the terms of
sale, may hold, retain and dispose of the Pledged Collateral without further
accountability therefor to any Pledgor or any third party (other than to the
Secured Parties). The Collateral Agent shall in any such sale make no
representations or warranties with respect to the Pledged Collateral or any part
thereof, and shall not be chargeable with any of the obligations or liabilities
of the Pledgors with respect thereto. The Collateral Agent may exercise, either
by itself or by its nominee or designee, in the name of the applicable
Pledgor(s), all of the rights, powers and remedies granted to the Collateral
Agent in this Section 10 in respect of any Pledged Collateral, any
organizational document pursuant to which any Pledgor owns its Pledged
Collateral, and may exercise and enforce all of the Collateral Agent's rights
and remedies hereunder and under law. Each Pledgor hereby agrees (i) it will
indemnify and hold each of the Agents, the Issuing Bank, the Lenders and any
other Secured Party harmless from and against any and all claims with respect to
the Pledged Collateral asserted before the taking of actual possession or
control of the Pledged Collateral by the Collateral Agent pursuant to this
Credit Agreement, or arising out of any act of, or omission to act on the part
of, any Person prior to such taking of actual possession or control by the
Collateral Agent (whether asserted before or after such taking of possession or
control), or arising out of any act on the part of any Pledgor, its agents or
Affiliates before or after the commencement of such actual possession or control
by the Collateral Agent and (ii) the Agents, the Issuing Bank, the Lenders and
any other Secured Party shall have no liability or obligation arising out of any
such claim. As an alternative to exercising the power of sale herein conferred
upon it, the Collateral Agent may proceed by a suit or suits at law or in equity
to foreclose upon the Collateral and Pledged Securities under this Credit
Agreement and to sell the Pledged Collateral, or any portion thereof, pursuant
to a judgment or decree of a court or courts having competent jurisdiction.
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SECTION 10.6 Application of Proceeds of Sale and Cash. Subject
to the provisions of the Intercreditor Agreement, the proceeds of sale of the
Pledged Collateral sold pursuant to Section 10.5 hereof shall be applied by the
Collateral Agent on behalf of the Secured Parties to the payment of all
reasonable out-of-pocket costs and expenses paid or incurred by any Agent in
connection with such sale, including, without limitation, all court costs, the
reasonable fees and expenses of counsel for any Agent in connection therewith,
the reasonable fees and expenses of any financial consultants in connection
therewith and the payment of all reasonable out-of-pocket costs and expenses
paid or incurred by any Agent in enforcing this Credit Agreement, in realizing
or protecting any Collateral and in enforcing or collecting any Obligations or
any Guaranty thereof, including, without limitation, court costs, the reasonable
attorneys' fees and expenses incurred by any Agent in connection therewith and
the reasonable fees and expenses of any financial consultants in connection
therewith and then to the indefeasible payment in full in cash of the
Obligations in accordance with Section 12.2(b) hereof. Any amounts remaining
after such indefeasible payment in full shall be remitted to the appropriate
Pledgor, or as a court of competent jurisdiction may otherwise direct.
SECTION 10.7 Securities Act, etc. In view of the position of
each Pledgor in relation to the Pledged Securities pledged by it, or because of
other present or future circumstances, a question may arise under the Securities
Act of 1933, as amended, as now or hereafter in effect, or any similar statute
hereafter enacted analogous in purpose or effect (such Act and any such similar
statute as from time to time in effect being hereinafter called the "Federal
Securities Laws"), with respect to any disposition of the Pledged Securities
permitted hereunder. Each Pledgor understands that compliance with the Federal
Securities Laws may very strictly limit the course of conduct of the Collateral
Agent if the Collateral Agent were to attempt to dispose of all or any part of
the Pledged Securities, and may also limit the extent to which or the manner in
which any subsequent transferee of any Pledged Securities may dispose of the
same. Similarly, there may be other legal restrictions or limitations affecting
the Collateral Agent in any attempt to dispose of all or any part of the Pledged
Securities under applicable Blue Sky or other state securities laws, or similar
laws analogous in purpose or effect. Under Applicable Law, in the absence of an
agreement to the contrary, the Collateral Agent may perhaps be held to have
certain general duties and obligations to a Pledgor to make some effort towards
obtaining a fair price even though the Obligations may be discharged or reduced
by the proceeds of a sale at a lesser price. Each Pledgor waives to the fullest
extent permitted by Applicable Law any such general duty or obligation to it,
and the Pledgors and/or the Credit Parties will not attempt to hold the
Collateral Agent, any other Agent, the Issuing Bank, any Lender or any other
Secured Party responsible for selling all or any part of the Pledged Securities
at an inadequate price, even if the Collateral Agent shall accept the first
offer received or does not approach more than one possible purchaser. Without
limiting the generality of the foregoing, the provisions of this Section 10.7
would apply if, for example, the Collateral Agent were to place all or any part
of the Pledged Securities for private placement by an investment banking firm,
or if such investment banking firm purchased all or any part of the Pledged
Securities for its own account, or if the Collateral Agent placed all or any
part of the Pledged Securities privately with a purchaser or purchasers.
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SECTION 10.8 Continuation and Reinstatement. Each Pledgor
further agrees that its pledge hereunder shall continue to be effective or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any Obligation is rescinded or must otherwise be restored by any Agent, the
Issuing Bank, any Lender or any other Secured Party upon the bankruptcy or
reorganization of any Pledgor or otherwise.
SECTION 10.9 Termination. The pledge referenced herein shall
terminate on the Facility Termination Date, at which time the Collateral Agent
shall assign and deliver to the appropriate Pledgor, or to such Person or
Persons as such Pledgor shall designate, against receipt, such of the Pledged
Securities (if any) as shall not have been sold or otherwise applied by the
Collateral Agent pursuant to the terms hereof and shall still be held by it
hereunder, together with appropriate instruments of reassignment and release.
Any such reassignment shall be free and clear of all Liens, arising by, under or
through any Lender but shall otherwise be without recourse upon or warranty by
the Collateral Agent and at the expense of the Pledgors.
11. CASH COLLATERAL
SECTION 11.1 Cash Collateral Account. There shall be
established with the Collateral Agent an account (the "Cash Collateral Account")
in the name of the Collateral Agent (for the benefit of the Secured Parties),
into which the Borrower may from time to time deposit Dollars pursuant to, and
in accordance with Section 2.11(l) hereof. Except to the extent otherwise
provided in this Article 11, the Cash Collateral Account shall be under the sole
dominion and control of the Collateral Agent and shall be subject to a control
agreement entered into between the Borrower and the Collateral Agent.
SECTION 11.2 Investment of Funds. (a) The Collateral Agent is
hereby authorized and directed to invest and reinvest the funds from time to
time deposited into the Cash Collateral Account, so long as no Event of Default
has occurred and is continuing, on the instructions of the Borrower (provided,
that any such instructions given verbally shall be confirmed promptly in
writing) or, if the Borrower shall fail to give such instructions upon delivery
of any such funds, in the sole discretion of the Collateral Agent; provided,
that in no event may the Borrower give instructions to the Collateral Agent to,
or may the Collateral Agent in its discretion, invest or reinvest funds in the
Cash Collateral Account in other than Cash Equivalents.
(b) Any net income or gain on the investment of funds from
time to time held in the Cash Collateral Account, shall be promptly reinvested
by the Collateral Agent as a part of the Cash Collateral Account; and any net
loss on any such investment shall be charged against the Cash Collateral
Account.
(c) None of the Agents, the Issuing Bank, any of the Lenders
nor any other Secured Party shall be a trustee for any of the Credit Parties, or
shall have any obligations or responsibilities, or shall be liable for anything
done or not done, in connection with the Cash Collateral Account, except as
expressly provided herein and except that the Collateral Agent shall have the
obligations of a secured party under the UCC. None of the Agents, the Issuing
Bank, any of the Lenders nor any other Secured Party shall have any obligation
or responsibility or shall be liable in any way for any investment decision made
in accordance with this Section 11.2 or for any decrease in the value of the
investments held in the Cash Collateral Account.
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SECTION 11.3 Grant of Security Interest. For value received
and to induce the Issuing Bank to issue Letters of Credit and the Lenders to
enter into this Credit Agreement and to make Loans to the Borrower and to
acquire participations in Letters of Credit from time to time as provided for in
this Credit Agreement, as security for the payment of all of the Obligations,
each of the Credit Parties hereby assigns to the Collateral Agent (for the
benefit of the Secured Parties) and grants to the Collateral Agent (for the
benefit of the Secured Parties), a first and prior Lien upon all of such Credit
Party's rights in and to the Cash Collateral Account, all cash, documents,
instruments and securities from time to time held therein, and all rights
pertaining to investments of funds in the Cash Collateral Account and all
products and proceeds of any of the foregoing. All cash, documents, instruments
and securities from time to time on deposit in the Cash Collateral Account, and
all rights pertaining to investments of funds in the Cash Collateral Account
shall immediately and without any need for any further action on the part of any
of the Credit Parties, the Collateral Agent or any other Secured Party, become
subject to the Lien set forth in this Section 11.3, be deemed Collateral for all
purposes hereof and be subject to the provisions of this Credit Agreement.
SECTION 11.4 Remedies. Subject to the provisions of the
Intercreditor Agreement, at any time during the continuation of an Event of
Default, the Collateral Agent may sell any documents, instruments and securities
held in the Cash Collateral Account and may immediately apply the proceeds
thereof and any other cash held in the Cash Collateral Account in accordance
with Section 12.2(b).
12. THE AGENTS AND THE ISSUING BANK
SECTION 12.1 Administration by the Agents. (a) The general
administration of the Fundamental Documents and any other documents contemplated
by this Credit Agreement or any other Fundamental Document shall be by the
Administrative Agent, the Collateral Agent, the Collateral Monitoring Agent or
their respective designees. Except as otherwise expressly provided herein, the
Issuing Bank and each of the Lenders hereby irrevocably authorizes the
Administrative Agent, the Collateral Agent or the Collateral Monitoring Agent
(as applicable), at its discretion, to take or refrain from taking such actions
as agent on its behalf and to exercise or refrain from exercising such powers
under the Fundamental Documents, any notes evidencing any of the Loans hereunder
and any other documents contemplated by this Credit Agreement or any other
Fundamental Document as are expressly delegated by the terms hereof or thereof,
as appropriate, to such Agent together with all powers reasonably incidental
thereto. None of the Agents shall have any duties or responsibilities except as
set forth in the Fundamental Documents.
(b) The Secured Parties hereby authorize the Collateral Agent
(in its sole discretion):
(i) in connection with the sale or other disposition of any
asset included in the Collateral or in the Real Property Assets or all
of the capital stock of any Guarantor, to the extent undertaken in
accordance with the terms of this Credit Agreement, to release a Lien
granted to it (for the benefit of the Secured Parties) on such asset or
capital stock and/or to release such Guarantor from its obligations
hereunder;
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(ii) to determine that the cost to the Borrower or another
Credit Party is disproportionate to the benefit to be realized by the
Agents, the Issuing Bank, the Lenders and the other Secured Parties by
perfecting a Lien in a given asset or group of assets included in the
Collateral and that the Borrower or other Credit Party should not be
required to perfect such Lien in favor of the Collateral Agent (for the
benefit of the Secured Parties);
(iii) to appoint subagents to be the holder of record of a
Lien to be granted to the Collateral Agent (for the benefit of the
Secured Parties) or to hold on behalf of the Collateral Agent such
Collateral or instruments relating thereto;
(iv) to enter into and perform its obligations under the other
Fundamental Documents; and
(v) to execute and deliver the agreements contemplated by
Section 12.13 hereof.
SECTION 12.2 Advances and Payments. (a) On the date of each
Loan, the Administrative Agent shall be authorized (but not obligated) to
advance, for the account of each of the applicable Lenders, the amount of the
applicable Loan to be made by it in accordance with its proportionate share of
its Commitments hereunder. Each of the Lenders hereby authorizes and requests
the Administrative Agent to advance for its account, pursuant to the terms
hereof, the amount of the Loan to be made by it, and each of the Lenders agrees
forthwith to reimburse the Administrative Agent in immediately available funds
for the amount so advanced on its behalf by the Administrative Agent. If any
such reimbursement is not made in immediately available funds on the same day on
which the Administrative Agent shall have made any such amount available on
behalf of any Lender, such Lender shall pay interest to the Administrative Agent
at a rate per annum equal to the Administrative Agent's cost of obtaining
overnight funds in the New York Federal Funds Market for the first three days
following the time when the Lender fails to make the required reimbursement, and
thereafter at a rate per annum equal to the Base Rate plus the Applicable
Interest Margin for Base Rate Loans which are Revolving Credit Loans. If and to
the extent that any such reimbursement shall not have been made to the
Administrative Agent, the Borrower agrees to repay to the Administrative Agent
forthwith on demand a corresponding amount with interest thereon for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent at the Base Rate plus the
Applicable Interest Margin for Base Rate Loans which are Revolving Credit Loans.
(b) If a Default or Event of Default has occurred and is then
continuing, any amounts received by the Administrative Agent in connection with
the Fundamental Documents, the application of which is not otherwise provided
for, shall be applied as follows:
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first, to pay to the Agents all unreimbursed costs and
expenses of the Agents which are payable by the Borrower or
any of the other Credit Parties pursuant to any of the
Fundamental Documents and all unreimbursed costs and expenses
of the Lenders which are payable pursuant to this Credit
Agreement; second, to pay pro rata to each Lender with a Loan
outstanding, accrued but unpaid interest on the Loans in
accordance with the amount of outstanding Loans owed to each
Lender; third, to pay pro rata to each Revolving Credit Lender
and Delayed Draw Term Loan Lender the accrued but unpaid
Commitment Fees in accordance with each Lender's Revolving
Credit Commitment Percentage and Delayed Draw Term Loan
Commitment Percentage; fourth, to pay pro rata to each Agent
and each Lender all unpaid Fees; fifth, to pay pro rata to
each Lender with a Loan outstanding, principal on the Loans in
accordance with the amount of outstanding Loans owed to each
Lender; and sixth, to pay any other amounts then due under
this Credit Agreement or any other Fundamental Document. All
amounts to be paid to any Lender by the Administrative Agent
shall be credited to that Lender, after collection by the
Administrative Agent, in immediately available funds either by
wire transfer or deposit in such Lender's correspondent
account with the Administrative Agent, or as such Lender and
the Administrative Agent shall agree in writing from time to
time.
SECTION 12.3 Sharing of Setoffs and Cash Collateral. (a) Each
of the Lenders agrees that if it shall, through the exercise of a right of
banker's lien, set off or counterclaim against any Credit Party (including, but
not limited to, pursuant to Section 13.21 hereof or as a secured claim under
Section 506 of the Bankruptcy Code or other security or interest arising from,
or in lieu of, such secured claim and received by such Lender under any
applicable bankruptcy, insolvency or other similar law) or otherwise, obtain
payment in respect of its Loans as a result of which the unpaid portion of its
Loans is proportionately less than the unpaid portion of Loans of any of the
other Lenders (a) it shall promptly purchase at par (and shall be deemed to have
thereupon purchased) from such other Lenders a participation in the Loans of
such other Lenders, so that the aggregate unpaid principal amount of each of the
Lender's Loans and its participation in Loans of the other Lenders shall be in
the same proportion to the aggregate unpaid principal amount of all Loans then
outstanding as the principal amount of its Loans prior to the obtaining of such
payment was to the principal amount of all Loans outstanding prior to the
obtaining of such payment and (b) such other adjustments shall be made from time
to time as shall be equitable to ensure that the Lenders share any such payment
pro rata. If all or any portion of such excess payment is thereafter recovered
from the Lender which originally received such excess payment, such purchase (or
portion thereof) shall be canceled and the purchase price restored to the extent
of such recovery. The Credit Parties expressly consent to the foregoing
arrangements and agree that any Lender or Lenders holding (or deemed to be
holding) a participation in a Loan may exercise any and all rights of banker's
lien, set off or counterclaim with respect to any and all moneys owing by the
Borrower to such Lender or Lenders as fully as if such Lender or Lenders held
such and was the original obligee on such Loan or on any note evidencing such
Loan (if applicable), in the amount of such participation.
(b) The Administrative Agent is hereby authorized at any time
and from time to time, to the fullest extent permitted by Applicable Law, to set
off and apply any and all amounts received by the Administrative Agent for the
account of a Defaulting Lender to the satisfaction of the unpaid obligations
owing by such Defaulting Lender to the Administrative Agent, the Collateral
Agent, the Collateral Monitoring Agent or the Issuing Bank and the rights of
such Defaulting Lender with respect to all such amounts shall be subject and
subordinate to the rights of the Administrative Agent, the Collateral Agent, the
Collateral Monitoring Agent and the Issuing Bank, as the case may be, to be paid
the amounts owing to it by such Defaulting Lender.
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SECTION 12.4 Notice to the Lenders. Upon receipt by the
Administrative Agent or the Issuing Bank from any of the Credit Parties of any
communication calling for an action on the part of the Lenders or the Revolving
Credit Lenders, as the case may be, or upon written notice to the Administrative
Agent of any Event of Default, the Administrative Agent or the Issuing Bank will
in turn promptly inform the other Lenders or the Revolving Credit Lenders, as
the case may be, in writing (which shall include facsimile communications) of
the nature of such communication or of the Event of Default, as the case may be.
SECTION 12.5 Liability of the Administrative Agent, Collateral
Agent, Collateral Monitoring Agent and the Issuing Bank. (a) The Administrative
Agent, the Collateral Agent, the Collateral Monitoring Agent, the Co-Lead
Arrangers and the Issuing Bank, when acting on behalf of the Lenders (or in the
case of the Collateral Agent, when acting on behalf of the Secured Parties), may
execute any of its duties under this Credit Agreement or the other Fundamental
Documents by or through its officers, agents, or employees and neither the
Administrative Agent, the Collateral Agent, the Collateral Monitoring Agent, the
Co-Lead Arrangers, the Issuing Bank nor their respective officers, agents or
employees shall be liable to the Lenders or any of them for any action taken or
omitted to be taken in good faith, nor be responsible to the Lenders or to any
of them for the consequences of any oversight or error of judgment, or for any
loss, unless the same shall happen through its gross negligence or willful
misconduct. The Administrative Agent, the Collateral Agent, the Collateral
Monitoring Agent, the Co-Lead Arrangers, the Issuing Bank and their respective
directors, officers, agents, and employees shall in no event be liable to the
Lenders or to any of them, nor shall any Lender have any cause of action against
any of them for any action taken or omitted to be taken by it pursuant to
instructions received by it from the Required Lenders or the Required Revolving
Credit Lenders, as the case may be, or in reliance upon the advice of counsel
selected by it with reasonable care or counsel to the Borrower. Without limiting
the foregoing, neither the Administrative Agent, the Collateral Agent, the
Collateral Monitoring Agent, the Co-Lead Arrangers, the Issuing Bank nor any of
their respective directors, officers, employees, or agents shall be responsible
to any of the Lenders for the due execution, validity, genuineness,
effectiveness, sufficiency, or enforceability of, or for any statement,
warranty, or representation in, or for the perfection of any security interest
contemplated by, this Credit Agreement, any other Fundamental Document or any
related agreement, document or order, or for freedom of any of the Collateral or
any of the Real Property Assets or any of the Pledged Securities from prior
Liens or security interests, or shall be required to ascertain or to make any
inquiry concerning the performance or observance by the Borrower or any other
Credit Party of any of the terms, conditions, covenants, or agreements of this
Credit Agreement, any other Fundamental Document, or any related agreement or
document.
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(b) None of the Administrative Agent (in its capacity as agent
for the Lenders), the Collateral Agent (in its capacity as agent for the Secured
Parties), the Collateral Monitoring Agent (in its capacity as agent for the
Secured Parties), the Co-Lead Arrangers, the Issuing Bank or any of their
respective directors, officers, employees, or agents shall have any
responsibility to the Borrower or any other Credit Party on account of the
failure or delay in performance or breach by any of the Lenders of any of such
Lender's obligations under this Credit Agreement, the other Fundamental
Documents or any related agreement or document or in connection herewith or
therewith. No Lender nor any of its directors, officers, employees or agents
shall have any responsibility to the Borrower or any other Credit Party on
account of the failure or delay in performance or breach by any other Lender of
such other Lender's obligations under this Credit Agreement, the other
Fundamental Documents or any related agreement or document or in connection
herewith or therewith.
(c) The Administrative Agent (as agent for the Lenders), the
Collateral Agent (as agent of the Secured Parties) and the Collateral Monitoring
Agent (as agent for the Secured Parties), the Co-Lead Arrangers and the Issuing
Bank shall be entitled to rely on any communication, instrument, or document
believed by it to be genuine or correct and to have been signed or sent by a
Person or Persons believed by it to be the proper Person or Persons, and it
shall be entitled to rely on advice of legal counsel (who may be counsel for the
Borrower), independent public accountants, and other professional advisers and
experts selected by it.
(d) Each of the Administrative Agent, the Collateral Agent,
the Collateral Monitoring Agent, the Co-Lead Arrangers and the Issuing Bank
shall be entitled to refrain from any act or the taking of any action (including
the failure to take an action) in connection herewith or any of the other
Fundamental Documents or from the exercise of any power, discretion or authority
vested in it hereunder or thereunder unless and until it shall have received
instructions in respect thereof from the Required Lenders or Required Revolving
Credit Lenders, as the case may be, and, upon receipt of such instructions from
the Required Lenders or Required Revolving Credit Lenders, as the case may be,
it shall be entitled to act or (where so instructed) refrain from acting, or to
exercise such power, discretion or authority, in accordance with such
instructions.
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SECTION 12.6 Reimbursement and Indemnification. Each of the
Lenders agrees (i) to reimburse the Administrative Agent, the Collateral Agent,
the Collateral Monitoring Agent, the Co-Lead Arrangers and/or the Issuing Bank
for such Lender's pro rata share of any expenses and fees incurred for the
benefit of the Lenders under the Fundamental Documents, including, without
limitation, counsel fees and compensation of agents, employees, financial
advisors and other professionals paid for services rendered on behalf of the
Agents, the Issuing Bank or the Lenders, and any other expense incurred in
connection with the operations or enforcement thereof not reimbursed by or on
behalf of the Borrower and (ii) to indemnify and hold harmless the
Administrative Agent, the Collateral Agent, the Collateral Monitoring Agent, the
Co-Lead Arrangers and/or the Issuing Bank and any of their respective directors,
officers, employees, or agents, on demand, in accordance with such Lender's
Percentage, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
(including reasonable attorneys' fees and disbursements) of any kind or nature
whatsoever which may be imposed on, incurred by, or asserted against, it or any
of them in any way relating to or arising out of any of the Fundamental
Documents or any related agreement or document, or any action taken or omitted
to be taken by it or any of them under any of the Fundamental Documents or any
related agreement or document, to the extent not reimbursed by or on behalf of
the Borrower or any other Credit Party (except such as shall result from the
gross negligence or willful misconduct of the Person to be reimbursed,
indemnified or held harmless, as applicable) and (iii) to indemnify and hold
harmless the Issuing Bank and any of its directors, officers, employees, or
agents, on demand, in the amount of its Revolving Credit Percentage share, from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against it
or any of them in any way relating to or arising out of the issuance of any
Letters of Credit or the failure to issue Letters of Credit (except as shall
result from the gross negligence or willful misconduct of the Person to be
reimbursed, indemnified or held harmless, as applicable). If any indemnity
furnished to any Agent, any Co-Lead Arranger or the Issuing Bank for any purpose
shall, in the opinion of such Agent, Co-Lead Arranger or the Issuing Bank, as
the case may be, be insufficient or become impaired, such Agent, Co-Lead
Arranger or the Issuing Bank, as the case may be, may call for additional
indemnity and cease, or not commence, to do the acts indemnified against until
such additional indemnity is furnished; provided, that in no event shall this
sentence require any Lender to indemnify any Agent, any Co-Lead Arranger or the
Issuing Bank against any liability, obligation, loss, damage, penalty, action,
judgment, suit, cost, expense or disbursement in excess of such Lender's pro
rata share thereof. To the extent indemnification payments made by the Lenders
pursuant to this Section 12.6 are subsequently recovered by the Administrative
Agent, the Collateral Agent, the Collateral Monitoring Agent, the Co-Lead
Arrangers or the Issuing Bank from a Credit Party, the Administrative Agent, the
Collateral Agent, the Collateral Monitoring Agent, the Co-Lead Arrangers or the
Issuing Bank, as applicable, will promptly refund such previously paid indemnity
payments to the Lenders.
SECTION 12.7 Rights of the Agents. It is understood and agreed
that each of the Agents shall have the same duties, rights and powers as a
Lender hereunder (including the right to give such instructions) as any of the
other Lenders and may exercise such rights and powers, as well as its rights and
powers under other agreements and instruments to which it is or may be party,
and engage in other transactions with any Credit Party or Affiliate thereof, as
though it were not the Administrative Agent, the Collateral Agent or the
Collateral Monitoring Agent (as applicable) or the Issuing Bank under this
Credit Agreement and the other Fundamental Documents.
SECTION 12.8 Independent Investigation by Lenders. Each of the
Lenders acknowledges that it has decided to enter into this Credit Agreement and
the other Fundamental Documents, to make the Loans and to participate in the
Letters of Credit hereunder based on its own analysis of the transactions
contemplated hereby and of the creditworthiness of the Credit Parties and agrees
that neither the Administrative Agent, the Collateral Agent, the Collateral
Monitoring Agent nor the Issuing Bank shall bear any responsibility therefor.
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SECTION 12.9 Agreement of the Lenders. Upon any occasion
requiring or permitting an approval, consent, waiver, election or other action
on the part of the Required Lenders, action shall be taken by the Administrative
Agent, the Collateral Agent or the Collateral Monitoring Agent for and on behalf
of, or for the benefit of, all Lenders upon the direction of the Required
Lenders and any such action shall be binding on all Lenders. No amendment,
modification, consent or waiver shall be effective except in accordance with the
provisions of Section 13.11 hereof.
SECTION 12.10 Notice of Transfer. The Administrative Agent,
the Collateral Agent, the Collateral Monitoring Agent and the Issuing Bank may
deem and treat any Lender which is a party to this Credit Agreement as the owner
of such Lender's respective portions of the Loans and participations in Letters
of Credit for all purposes, unless and until a written notice of the assignment
or transfer thereof executed by any such Lender shall have been received by the
Administrative Agent and shall have become effective in accordance with Section
13.3 hereof.
SECTION 12.11 Relations Among Lenders. Each Lender in its
capacity as a Lender hereunder agrees that it will not take any legal action,
nor institute any actions or proceedings, against the Borrower or any other
Credit Party hereunder or under any other Fundamental Document, or with respect
to any Collateral or any Real Property Asset, it being understood and agreed
that all such actions are to be taken by the Administrative Agent or the
Collateral Agent (as applicable) on behalf of the Lenders. Without limiting the
generality of the foregoing, no Lender may unilaterally terminate its Commitment
or accelerate, or otherwise enforce or seek to enforce any rights or remedies
with respect to, any Loans or other Obligations owed to it, except statutory or
common law rights of banker's liens and setoff with respect to accounts
maintained with such Lender.
SECTION 12.12 Successor Agents. The Administrative Agent, the
Collateral Agent or the Collateral Monitoring Agent may resign at any time by
giving written notice thereof to the Lenders and the Borrower, but such
resignation shall not become effective until acceptance by a successor agent of
its appointment pursuant hereto. Upon any such resignation, the retiring
Administrative Agent, retiring Collateral Agent or retiring Collateral
Monitoring Agent (as applicable) shall promptly appoint a successor agent from
among the Lenders; provided, that such replacement is reasonably acceptable (as
evidenced in writing) to the Required Lenders, the Issuing Bank and the
Borrower; provided, however, that such approval by the Borrower shall not be
required at any time when a Default or Event of Default has occurred and is
continuing. If no successor agent shall have been so appointed by the retiring
Administrative Agent, retiring Collateral Agent or retiring Collateral
Monitoring Agent (as applicable) and shall have accepted such appointment,
within 30 days after the retiring agent's giving of notice of resignation, the
Borrower may appoint a successor as agent (provided, that such successor is
reasonably acceptable to the Required Lenders and the Issuing Bank), which shall
be either a Lender or a commercial bank organized under the laws of the United
States of America or of any State thereof and shall have a combined capital and
surplus of at least $250,000,000. Upon the acceptance of any appointment as
Administrative Agent, Collateral Agent or Collateral Monitoring Agent (as
applicable) hereunder by a successor agent, such successor agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent, retiring Collateral Agent or retiring
Collateral Monitoring Agent (as applicable), and the retiring Administrative
Agent, retiring Collateral Agent or retiring Collateral Monitoring Agent (as
applicable) shall be discharged from its duties and obligations under this
Credit Agreement, the other Fundamental Documents and any other credit
documentation. After any retiring Administrative Agent's, retiring Collateral
Agent's or retiring Collateral Monitoring Agent's (as applicable) resignation
hereunder as Administrative Agent, Collateral Agent or Collateral Monitoring
Agent (as applicable), the provisions of this Article 12 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent, Collateral Agent or Collateral Monitoring Agent (as
applicable) under this Credit Agreement and the other Fundamental Documents.
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SECTION 12.13 Tenant's Quiet Enjoyment. Upon the written
request of the Borrower, the Collateral Agent shall deliver a subordination,
non-disturbance and attornment agreement, in favor of the lessee under any lease
of Real Property Assets, in form and substance reasonably satisfactory to the
Collateral Agent and the Borrower, pursuant to which agreement the Collateral
Agent shall agree (to the extent required by the applicable lease or sublease)
(a) to give the tenant or subtenant thereunder the same notice, if any, given to
the Borrower of any default or acceleration of any obligation underlying the
applicable Mortgage or any sale in foreclosure under such Mortgage, (b) to
permit the tenant or subtenant thereunder to cure any such default on the
Borrower's behalf within any applicable cure period, (c) to permit the tenant or
subtenant thereunder to appear by its representative and to bid at any sale in
foreclosure made with respect to the applicable Mortgage and (d) subject to the
terms to be included in the applicable subordination, non-disturbance and
attornment agreement, not to disturb the aforesaid tenant's or subtenant's
possession so long as it is not in default in performing its obligations under
such lease or sublease.
SECTION 12.14 Lender Payments. (a) Except as otherwise
provided herein, all payments by any Lender hereunder shall be made to the
Administrative Agent at the office of First Union National Bank, 201 South
College Street, Charlotte, NC 28288, Attention: Syndication Agency Services
(wiring information: ABA-053000219, Acct. No.: 5000000030499, Account Name:
Genesis Health Ventures, Inc., Ref: Genesis Health Ventures, Inc.) not later
than 1:00 p.m. (Eastern time). All payments received after such time shall be
deemed received on the next succeeding Business Day. All payments shall be made
in immediately available funds in lawful money of the United States of America.
(b) If any Agent, the Issuing Bank, any Lender or any other
Secured Party is required at any time to return to the Borrower, or to a
trustee, receiver, liquidator, custodian, or any official under any proceeding
under any Debtor Relief Law, any portion of a payment made by the Borrower, each
such Secured Party shall, on demand of the Collateral Agent, return its share of
the amount to be returned which is received by the applicable Secured Party,
plus interest thereon from the date of such demand to the date such payment is
made at a rate per annum equal to the Federal Funds Rate:
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13. MISCELLANEOUS
SECTION 13.1 Notices. (a) Notices and other communications
provided for herein shall be in writing and shall be delivered addressed:
(i) if to the Administrative Agent and Collateral Agent:
First Union National Bank
201 South College Street
Charlotte, NC 28288
Attn: Syndication Agency Services
Facsimile No.: (704) 383-0288
With a copy to:
First Union National Bank
301 South College Street
Charlotte, NC 28288
Attn: Colleen McCullum
Facsimile No.: (704) 383-6249
E-mail: colleen.mccullum@funb.com
(ii) if to the Collateral Monitoring Agent:
General Electric Capital Corporation
2325 Lakeview Parkway
Suite 700
Alpharetta, GA 30004
Attn: George Attmore
Facsimile No.: (678) 624-7904
E-mail: george.attmore@gecapital.com
(iii) if to a Credit Party:
Genesis Health Ventures, Inc.
101 East State Street
Kennett Square, PA 19348
Attn: George V. Hager, Jr.
Facsimile No.: (610) 925-4100
(iv) if to the Lender, to it at its address set forth on
its signature page hereto.
or such other address as such party may from time to time designate by giving
written notice to the other parties hereunder.
Any failure of any Person giving notice pursuant to this Section 13.1, to
provide a courtesy copy to a party as provided herein, shall not affect the
validity of such notice. All notices and other communications given to any party
hereto in accordance with the provisions of this Credit Agreement shall be
deemed to have been given (x) on the fifth Business Day after the date when sent
by registered or certified mail, postage prepaid, return receipt requested, if
by mail, (y) when delivered, if delivered by hand or overnight courier service
or (z) when receipt is acknowledged, if by facsimile communications equipment or
e-mail in each case addressed to such party as provided in this Section 13.1 or
in accordance with the latest unrevoked written direction from such party.
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(b) No notice to or demand on any of the Credit Parties shall
entitle such Credit Party to any other or further notice or demand in the same,
similar or other circumstances.
SECTION 13.2 Survival of Agreement, Representations and
Warranties, etc. All warranties, representations and covenants made by any of
the Credit Parties herein, in any other Fundamental Document or in any
certificate or other instrument delivered by it or on its behalf in connection
with this Credit Agreement or any other Fundamental Document shall be considered
to have been relied upon by the Administrative Agent, the Collateral Agent, the
Collateral Monitoring Agent, the Issuing Bank and the Lenders and, except for
any terminations, amendments, modifications or waivers thereof in accordance
with the terms hereof, shall survive the execution and delivery of this Credit
Agreement, the making of the Loans and the issuance of the Letters of Credit
herein contemplated and the execution and delivery of any notes evidencing any
Loan hereunder regardless of any investigation made by the Administrative Agent,
the Collateral Agent, the Collateral Monitoring Agent, the Issuing Bank or the
Lenders or on their behalf, and shall continue in full force and effect so long
as any Obligation is outstanding and unpaid and so long as the Commitments have
not been terminated. All statements in any such certificate or other instrument
shall constitute representations and warranties by the Credit Parties hereunder.
SECTION 13.3 Successors and Assigns; Syndications; Loan Sales;
Participations. (a) Whenever in this Credit Agreement any of the parties hereto
is referred to, such reference shall be deemed to include the successors and
assigns of such party; provided, however, that neither the Borrower nor any
other Credit Party may assign its rights hereunder without the prior written
consent of the Administrative Agent, the Collateral Agent, the Collateral
Monitoring Agent, the Issuing Bank and all of the Lenders, and all covenants,
promises and agreements by or on behalf of any of the Credit Parties which are
contained in this Credit Agreement shall inure to the benefit of the successors
and assigns of the Administrative Agent, the Collateral Agent, the Collateral
Monitoring Agent, the Issuing Bank and the Lenders.
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(b) Each of the Lenders may (but only with the prior written
consent of the Administrative Agent and the Borrower and in the case of an
assignment of a Revolving Credit Commitment and/or Revolving Loans, the Issuing
Bank, which consent in each case shall not be unreasonably withheld and which
consent by the Borrower shall not be required if at the time the applicable
Assignment and Acceptance is delivered to the Administrative Agent for its
acceptance and recording, an Event of Default has occurred and is then
continuing) assign to one or more Lenders or an Eligible Assignee all or a
portion of its interests, rights and obligations under this Credit Agreement
(including, without limitation, all or a portion of any Loans at the time owing
to it, any note held by it evidencing such Loans, or all or a portion of its
Commitment(s) and the same portion of all Loans at the time owing to it and any
notes held by it evidencing its Loans and its obligations with regard to Letters
of Credit); provided, however, that (i) each assignment shall (x) in the case of
a Revolving Credit Loan or Revolving Credit Commitment, be in a minimum amount
of $2,500,000 (or such lesser amount as shall equal any Lender's entire
Revolving Credit Loans or Revolving Credit Commitment)), or (y) in the case of a
B Term Loan or Delayed Draw Term Loan or Delayed Draw Term Loan Commitment, be
in a minimum amount of $1,000,000 (or such lesser amount as shall equal any
Lender's entire B Term Loan or Delayed Draw Term Loan or Delayed Draw Term Loan
Commitment), (ii) the parties to each such assignment shall execute and deliver
to the Administrative Agent, for its acceptance and recording in the Register
(as defined below), an Assignment and Acceptance substantially in the form of
Exhibit A hereto, together with the assigning Lender's original note (if any)
evidencing the Loans being assigned and a processing and recordation fee of
$3,500 (which fee shall also be payable in the case of assignments from an
assigning Lender to another Lender hereunder) to be paid to the Administrative
Agent by the assigning Lender or the assignee and (iii) if the assignee is not
incorporated under the laws of the United States of America or a state thereof,
it shall deliver to the Borrower and the Administrative Agent certification as
to the exemption from deduction or withholding of any United States federal
income taxes in accordance with Section 2.18. Upon such execution, delivery,
acceptance and recording, from and after the effective date specified in each
Assignment and Acceptance, which effective date shall not (unless otherwise
agreed to by the Administrative Agent) be earlier than five (5) Business Days
after the date of acceptance and recording by the Administrative Agent, (x) the
assignee thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereunder
and under the other Fundamental Documents and shall be bound by the provisions
hereof and (y) the assigning Lender thereunder shall, to the extent provided in
such Assignment and Acceptance, relinquish its rights and be released from its
obligations under this Credit Agreement except that, notwithstanding such
assignment, any rights and remedies available to the Borrower for any breaches
by such assigning Lender of its obligations hereunder while a Lender shall be
preserved after such assignment and such Lender shall not be relieved of any
liability to the Borrower due to any such breach. In the case of an Assignment
and Acceptance covering all or the remaining portion of the assigning Lender's
rights and obligations under this Credit Agreement, such assigning Lender shall
cease to be a party hereto. It shall not be necessary for any Lender to sell the
same percentage of its Revolving Credit Commitment and Revolving Credit Loans,
its B Term Loans and its Delayed Draw Term Loan Commitment and Delayed Draw Term
Loans (as the case may be) (although each such percentage of its Revolving
Credit Commitment and Revolving Credit Loans, its B Term Loans and its Delayed
Draw Term Loan Commitment and Delayed Draw Term Loans must be a constant, not
varying percentage) (provided, that any such assignment shall be subject to the
provisions of this Section 13.3 in all respects).
(c) Each Lender, in accordance with Section 13.3(b) hereof
(other than with respect to the minimum amount of an assignment and necessity of
obtaining consents which shall be governed by the provisions set forth below of
this Section 13.3(c)), may at any time make an assignment of its interests,
rights and obligations under this Credit Agreement to any Affiliate of such
Lender or to a Related Fund without the consent of the Administrative Agent, the
Issuing Bank or the Borrower or any other Credit Party. Any assignment to any
Affiliate of the assigning Lender or to a Related Fund hereunder shall not be
subject to the requirement of Section 13.3(b) as to a minimum amount and any
such assignment to any Affiliate of the assigning Lender or to a Related Fund
shall not release the assigning Lender from its remaining obligations hereunder,
if any.
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(d) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby and that such interest is free and clear of any
adverse claim, the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or any other
Fundamental Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement, any of the other
Fundamental Documents or any other instrument or document furnished pursuant
hereto or thereto; (ii) such assignor Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any of
the Credit Parties or the performance or observance by any of the Credit Parties
of any of their respective obligations under the Fundamental Documents or any
other instrument or document furnished pursuant thereto; (iii) such assignee
confirms that it has received a copy of this Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Sections
5.1(a), 5.1(b), and 5.1(c) (or if none of such financial statements shall have
then been delivered, then copies of the financial statements referred to in
Section 3.6 hereof) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee agrees that it will, independently
and without reliance upon the assigning Lender, the Administrative Agent, the
Collateral Agent, the Collateral Monitoring Agent, the Issuing Bank, any other
Lender or any other Secured Party and based on such documents and information as
it shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under this Credit Agreement or any of the other
Fundamental Documents or any other instrument or document furnished pursuant
thereto; (v) such assignee appoints and authorizes the Administrative Agent, the
Collateral Agent, the Collateral Monitoring Agent and the Issuing Bank to take
such action as agent(s) on its behalf and to exercise such powers under this
Credit Agreement as are delegated to the Administrative Agent, the Collateral
Agent, the Collateral Monitoring Agent or the Issuing Bank (as applicable) by
the terms hereof, together with such powers as are reasonably incidental
thereto; and (vi) such assignee agrees that it will be bound by the provisions
of this Credit Agreement and the other Fundamental Documents and will perform in
accordance with their terms all of the obligations which by the terms of this
Credit Agreement and the other Fundamental Documents are required to be
performed by it as a Lender.
(e) The Administrative Agent shall maintain at its address at
which notices are to be given to it pursuant to Section 13.1 hereof a copy of
each Assignment and Acceptance and a register for the recordation of the names
and addresses of the Lenders and the Commitments of, and principal amount of the
Loans owing to, each Lender from time to time (the "Register"). The entries in
the Register shall be conclusive, in the absence of manifest error, and the
Credit Parties, the Administrative Agent, the Collateral Agent, the Collateral
Monitoring Agent, the Issuing Bank and the Lenders may treat each Person whose
name is recorded in the Register as a Lender hereunder for all purposes of the
Fundamental Documents. The Register shall be available for inspection by any
Credit Party or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(f) Subject to the foregoing, upon its receipt of an
Assignment and Acceptance executed by an assigning Lender and an assignee
together with the assigning Lender's original note (if any) evidencing the Loans
being assigned thereby, the processing and recordation fee, and evidence of the
Administrative Agent's and the Borrower's written consent to such assignment (if
required), the Administrative Agent shall, if such Assignment and Acceptance has
been completed and is substantially in the form of Exhibit A hereto, (i) accept
such Assignment and Acceptance, (ii) record the information contained therein in
the Register and (iii) give prompt written notice thereof to the Borrower.
Within five (5) Business Days after receipt of the notice, the Borrower, at its
own expense, shall execute and deliver to the Administrative Agent, in exchange
for any surrendered note, a new note to the order of such assignee in an amount
equal to the Revolving Credit Commitment or the principal amount of the B Term
Loan or Delayed Draw Term Loan or the Delayed Draw Term Loan Commitment (as
appropriate) assumed by the assignee Lender pursuant to such Assignment and
Acceptance and if the assigning Lender has retained a Revolving Credit
Commitment, any portion of a B Term Loan or Delayed Draw Term Loan or a Delayed
Draw Term Loan Commitment hereunder, a new note to the order of the assigning
Lender in an amount equal to the Revolving Credit Commitment, the principal
amount of the B Term Loan or Delayed Draw Term Loan or the Delayed Draw Term
Loan Commitment (as appropriate) retained by it hereunder. Such new notes shall
be in an aggregate principal amount equal to the aggregate principal amount of
the surrendered note (or if applicable, the outstanding principal amount of the
applicable Loan owed to the assigning Lender immediately preceding the relevant
assignment), shall be dated the date of the surrendered note and shall otherwise
be in substantially the form of the surrendered note.
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(g) Each of the Lenders may, without the consent of any of the
Credit Parties or any of the Agents, the Issuing Bank or the other Lenders, sell
participations to one or more banks, mutual funds or other financial
institutions in all or a portion of its rights and obligations under this Credit
Agreement (including, without limitation, all or a portion of any B Term Loans
or Delayed Draw Term Loans at the time owing to it and any note held by it
evidencing such Loans, all or a portion of its Delayed Draw Term Loan
Commitment, or all or a portion of its Revolving Credit Commitment and the same
portion of all Revolving Credit Loans (if any) at the time owing to it and any
notes held by it evidencing its Revolving Credit Loans and its participation in
Letters of Credit); provided, however, that (i) any such Lender's obligations
under this Credit Agreement shall remain unchanged, (ii) such participant shall
not be granted any voting rights or any right to control the vote of such Lender
under this Credit Agreement, except that such participant may be granted voting
rights (or a right to control the vote of such Lender under this Credit
Agreement) with respect to (A) proposed decreases to interest rates or fees, (B)
subject to Section 13.11 hereof changes to the amount of the Revolving Credit
Commitments or Delayed Draw Term Loan Commitments (except for a ratable decrease
in the Total Revolving Credit Commitment of all Lenders holding Revolving Credit
Commitments or in the Total Delayed Draw Term Loan Commitment of all Lenders
holding Delayed Draw Term Loan Commitments), (C) final maturity of any Loan and
fees (in each case, as applicable to such participant) and (D) releases of all
or substantially all the Collateral and the Real Property Assets, (iii) any such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iv) the participating banks or other entities
shall be entitled to the cost protection provisions contained in Sections 2.15,
2.16, 2.17, 2.18 and 2.21 hereof, but a participant shall not be entitled to
receive pursuant to such provisions an amount larger than its share of the
amount to which the Lender granting such participation would have been entitled
to receive and (v) the Credit Parties, the Administrative Agent, the Collateral
Agent and the Collateral Monitoring Agent, the Issuing Bank and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's and its participants' rights and obligations under
this Credit Agreement.
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(h) A Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
13.3, disclose to the assignee or participant or proposed assignee or
participant, any information relating to any of the Credit Parties furnished to
the Administrative Agent, the Collateral Agent, the Collateral Monitoring Agent,
the Issuing Bank or such Lender by or on behalf of the Borrower or any other
Credit Party; provided, that prior to any such disclosure, each such assignee or
participant or proposed assignee or participant shall agree in writing to be
bound by the provisions of Section 13.17 hereof.
(i) The Credit Parties consent that any Lender may at any time
and from time to time pledge or otherwise grant a security interest in any Loan
or in any Note evidencing the Loans (or any part thereof) to any Federal Reserve
Bank.
(j) Any assignment pursuant to paragraph (b) or (c) of this
Section 13.3 shall constitute an amendment of the Commitments appearing on the
signature pages hereto as of the effective date of such assignment.
(k) Notwithstanding anything contained in this Sections any
Lender may at any time assign or pledge all or any portion of its rights under
this Agreement without the prior written consent of the Borrower, the Agents or
the Issuing Bank to secure extensions of credit to such Lender or in support of
obligations owed by such Lender; provided that (i) no such assignment or pledge
shall release a Lender from any of its obligations hereunder or substitute any
such assignee for such Lender as a party hereto and (ii) the right of any such
assignee or pledgee to exercise any of such Lender's rights hereunder or to
further transfer all or any portion of the rights pledged or granted to it,
whether by means of foreclosure or otherwise shall at all times be subject to
the other terms and provisions of this Section 13.3. In order to facilitate such
an assignment, the Borrower shall, at the request of the assigning Lender, duly
execute and deliver to the assigning Lender a Note or Notes evidencing the Loans
made to the Borrower by the assigning Lender hereunder.
SECTION 13.4 Expenses; Documentary Taxes. Whether or not the
transactions hereby contemplated shall be consummated, the Borrower agrees to
pay (a) all reasonable out-of-pocket expenses incurred by the Administrative
Agent, the Collateral Agent, the Collateral Monitoring Agent and the Issuing
Bank in connection with, or arising out of, the performance of due diligence,
the negotiation, preparation, execution, delivery, waiver or modification and
administration of this Credit Agreement and any other documentation contemplated
hereby, the making of the Loans and the issuance of the Letters of Credit, the
Collateral, the Pledged Securities, any Real Property Asset or any Fundamental
Document, including but not limited to, the reasonable out-of-pocket costs and
internally allocated charges of one legal counsel or audit or field examinations
of the Administrative Agent, the Collateral Agent, the Collateral Monitoring
Agent and the Issuing Bank connection with the administration of this Credit
Agreement, the verification of financial data or the transactions contemplated
hereby, and the reasonable fees and disbursements of Morgan, Lewis & Bockius
LLP, counsel for the Agents, and any other counsel that any of the Agents shall
retain and (b) all reasonable out-of-pocket expenses incurred by the Agents, the
Issuing Bank, any Lender and any other Secured Party in the enforcement or
protection (as distinguished from administration) of the rights and remedies of
the Agents, the Issuing Bank, the Lenders and any other Secured Parties in
connection with this Credit Agreement, the other Fundamental Documents, the
Letters of Credit or any notes evidencing the Loans hereunder, or as a result of
any transaction, action or non-action arising from any of the foregoing,
including but not limited to, the reasonable fees and disbursements of any
counsel for any of the Agents, the Issuing Bank, the Lenders or any other
Secured Party. Such payments shall be made on the date this Credit Agreement is
executed by the Borrower and thereafter on demand. The Borrower agrees that it
shall indemnify the Agents, the Issuing Bank, the Lenders and any other Secured
Parties from and hold them harmless against any documentary taxes, assessments
or charges made by any Governmental Authority by reason of the execution and
delivery of this Credit Agreement or any notes evidencing any of the Loans
hereunder or the issuance of Letters of Credit. The obligations of the Borrower
under this Section 13.4 shall survive the Facility Termination Date, the
termination of this Credit Agreement and the payment of the Loans and/or the
expiration of the Letters of Credit.
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SECTION 13.5 Indemnity. The Borrower agrees to indemnify and
hold harmless the Agents, the Issuing Bank, the Co-Lead Arrangers, the Lenders
and any other Secured Parties, their respective directors, officers, employees,
trustees, investments advisors and agents, and any professionals retained by
them (each an "Indemnified Party") (to the full extent permitted by Applicable
Law) from and against any and all claims, demands, losses, judgments, damages
and liabilities (including liabilities for penalties) incurred by any of them as
a result of, or arising out of, or in any way related to, or by reason of, any
investigation, litigation or other proceeding (whether or not any Indemnified
Party is a party thereto) related to the entering into and/or performance of
this Credit Agreement or any other Fundamental Document or the use of the
proceeds of any Loans hereunder or the issuance of any Letter of Credit or the
consummation of any other transaction contemplated in this Credit Agreement or
any other Fundamental Document, including, without limitation, the reasonable
fees and disbursements of counsel incurred in connection with any such
investigation, litigation or other proceeding (but excluding any such losses,
liabilities, claims, damages or expenses of an Indemnified Party to the extent
incurred by reason of the gross negligence or willful misconduct of such
Indemnified Party as determined by a final order or judgment of a court of
competent jurisdiction). The foregoing indemnity agreement includes any
reasonable costs incurred by an Indemnified Party in connection with any action
or proceeding which may be instituted in respect of the foregoing by one of the
Agents, the Co-Lead Arrangers or the Issuing Bank or by any other Person either
against one of the Agents, the Co-Lead Arrangers, the Issuing Bank or the
Lenders or in connection with which any officer or employee of one of the
Agents, the Co-Lead Arrangers, the Issuing Bank or the Lenders is called as a
witness or deponent, including, but not limited to, the reasonable fees and
disbursements of Morgan, Lewis & Bockius LLP, counsel to the Agents and the
Co-Lead Arrangers and any out-of-pocket costs incurred by the Agents, the
Co-Lead Arrangers, the Issuing Bank, the Lenders or any other Secured Party in
appearing as a witness or in otherwise complying with legal process served upon
them. The obligations of the Borrower under this Section 13.5 shall survive the
Facility Termination Date, the termination of this Credit Agreement and the
payment of the Loans and/or the expiration or termination of the Letters of
Credit and shall inure to the benefit of any Person who was a Lender
notwithstanding such Person's assignment of all its Loans and its Revolving
Credit Commitment or Delayed Draw Term Loan Commitment hereunder.
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If a Credit Party shall fail to do any act or thing which it
has covenanted to do hereunder or under a Fundamental Document, or any
representation or warranty of a Credit Party shall be breached, the
Administrative Agent may (but shall not be obligated to) do the same or cause it
to be done or remedy any such breach, and there shall be added to the
Obligations hereunder the cost or expense incurred by the Administrative Agent
in so doing, and any and all amounts expended by the Administrative Agent in
taking any such action shall be repayable to it upon its demand therefor and
shall bear interest at a rate per annum of 2% in excess of the rate then in
effect for Base Rate Loans which are Revolving Credit Loans set forth in Section
2.13(a) from time to time in effect from the date advanced to the date of
repayment.
SECTION 13.6 CHOICE OF LAW. THIS CREDIT AGREEMENT, THE OTHER
FUNDAMENTAL DOCUMENTS AND ANY NOTE EVIDENCING ANY OF THE LOANS HEREUNDER SHALL
IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES AND BY
FEDERAL LAW TO THE EXTENT APPLICABLE; PROVIDED, HOWEVER, THAT WITH RESPECT TO
ANY MORTGAGE FILED IN A JURISDICTION OUTSIDE THE STATE OF NEW YORK, THE LAWS OF
SUCH JURISDICTION WHERE SUCH MORTGAGE WAS FILED SHALL APPLY.
SECTION 13.7 WAIVER OF JURY TRIAL. TO THE EXTENT NOT
PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY
WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT
OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE,
CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS
CREDIT AGREEMENT, THE SUBJECT MATTER HEREOF, ANY OTHER FUNDAMENTAL DOCUMENT OR
THE SUBJECT MATTER THEREOF, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING AND WHETHER IN CONTRACT OR TORT OR OTHERWISE. EACH PARTY HERETO
ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTIES HERETO THAT THE
PROVISIONS OF THIS SECTION 13.7 CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH SUCH
OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO THIS
CREDIT AGREEMENT AND ANY OTHER FUNDAMENTAL DOCUMENT. ANY PARTY MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 13.7 WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF ANY OTHER PARTY TO THE WAIVER OF ITS RIGHTS TO TRIAL
BY JURY.
SECTION 13.8 WAIVER WITH RESPECT TO DAMAGES. EACH CREDIT PARTY
ACKNOWLEDGES THAT NEITHER THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, THE
COLLATERAL MONITORING AGENT, THE CO-LEAD ARRANGERS, THE ISSUING BANK, ANY LENDER
NOR ANY OTHER SECURED PARTY HAS ANY FIDUCIARY RELATIONSHIP WITH, OR FIDUCIARY
DUTY TO, ANY CREDIT PARTY ARISING OUT OF OR IN CONNECTION WITH THIS CREDIT
AGREEMENT OR ANY OTHER FUNDAMENTAL DOCUMENT AND THE RELATIONSHIP BETWEEN THE
ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, THE COLLATERAL MONITORING AGENT, THE
CO-LEAD ARRANGERS, THE ISSUING BANK, THE LENDERS AND ANY OTHER SECURED PARTIES,
ON THE ONE HAND, AND THE CREDIT PARTIES, ON THE OTHER HAND, IN CONNECTION
THEREWITH IS SOLELY THAT OF DEBTOR AND CREDITOR. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, NO CREDIT PARTY SHALL ASSERT, AND EACH CREDIT PARTY HEREBY
WAIVES, ANY CLAIMS AGAINST THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT, THE
COLLATERAL MONITORING AGENT, THE CO-LEAD ARRANGERS, THE ISSUING BANK, THE
LENDERS AND ANY OTHER SECURED PARTY ON ANY THEORY OF LIABILITY, FOR SPECIAL,
INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL
DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS CREDIT
AGREEMENT, ANY FUNDAMENTAL DOCUMENT, ANY AGREEMENT OR INSTRUMENT CONTEMPLATED
HEREBY OR THEREBY, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
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SECTION 13.9 No Waiver. No failure on the part of the
Administrative Agent, the Collateral Agent, the Collateral Monitoring Agent, the
Issuing Bank, any Lender or any other Secured Party to exercise, and no delay in
exercising, any right, power or remedy hereunder, under any note evidencing any
Loan hereunder, with regard to any Letter of Credit, or any other Fundamental
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right, power or remedy preclude any other or further
exercise thereof or the exercise of any other right, power or remedy. All
remedies hereunder are cumulative and are not exclusive of any other remedies
provided by law.
SECTION 13.10 Extension of Payment Date. Except as otherwise
specifically provided in Article 2 hereof, should any payment or prepayment of
principal of or interest on any of the Loans or any other amount due hereunder,
become due and payable on a day other than a Business Day, the due date of such
payment or prepayment shall be extended to the next succeeding Business Day and,
in the case of a payment or prepayment of principal, interest shall be payable
thereon at the rate herein specified during such extension.
SECTION 13.11 Amendments, etc. (a) Unless otherwise
specifically provided herein any provision of this Credit Agreement may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by the Credit Parties and the Required Lenders (and, if the rights or
duties of any of the Agents are affected thereby, by the applicable Agent);
provided, that if such amendment or waiver affects only the Lenders holding B
Term Loans, Delayed Draw Term Loans (or Delayed Draw Term Loan Commitments) or
Revolving Credit Loans (or Revolving Credit Commitments), as applicable, then
only Lenders holding more than 50% of the Loans in the applicable Tranche (or
the Revolving Credit Commitments or Delayed Draw Term Loan Commitments, if
applicable) shall be required to sign such amendment or waiver; provided,
further, that no such amendment or waiver shall (i) increase or decrease the
Commitment of any Lender (except for a ratable decrease in the Commitment of all
Lenders holding Commitments for that Tranche), without the prior written consent
of such Lender, (ii) reduce the principal of, or rate of interest on, any Loan
or any Fees specified herein, due to a Lender without the prior written consent
of such Lender, (iii) postpone the date fixed for any payment of principal of,
or interest on, any Loan or any Fees hereunder due to a Lender or for any
reduction or termination of the Commitment of a Lender, without the prior
written consent of each such Lender, (iv) increase the amount of the B Term
Loans, Delayed Draw Term Loans or the Revolving Credit Loans of a Lender,
without the prior written consent of such Lender, (v) decrease any amount
payable to a Lender pursuant to the provisions of Section 2.12 or Section 12.2
hereof, without the prior written consent of each such Lender, (vi) release all
or substantially all of the Collateral and the Real Property Assets from the
Liens created by the Fundamental Documents (except as expressly permitted
hereby), without the prior written consent of all the Lenders, (vii) amend or
modify the provisions of this Section 13.11, without the prior written consent
of all the Lenders, (viii) amend the definition of "Required Lenders," without
the prior written consent of all the Lenders or "Required Revolving Credit
Lenders" without the consent of all the Revolving Credit Lenders or (ix) amend
or modify any provision of this Agreement which expressly provides for the
unanimous consent or approval of the Lenders. No such amendment, modification,
waiver or consent shall amend Section 2.21 hereof or adversely affect the rights
and obligations of the Issuing Bank hereunder without its prior written consent.
Each holder of a Commitment, a Loan or a note evidencing any Loan hereunder
shall be bound by any amendment, modification, waiver or consent authorized as
provided herein (whether or not any applicable note shall have been marked to
indicate such amendment, modification, waiver or consent); and any consent by
any holder of a Commitment, a Loan or a note shall bind any Person subsequently
acquiring such Commitment, Loan or note (whether or not any applicable note is
so marked).
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(b) If a condition to Borrowing or the issuance of a Letter of
Credit hereunder is not satisfied or some other event occurs that would prohibit
the Borrower from borrowing or receiving a Letter of Credit hereunder, then in
order to waive such condition or consent to such event, the consent of the
Required Revolving Credit Lenders (as a separate group) shall be required in
addition to any other consent required pursuant this Credit Agreement.
(c) Notwithstanding the foregoing provisions of this Section
13.11 or anything to the contrary contained in this Credit Agreement, any Lender
which has requested that it not receive material, non-public information
concerning the Borrower or any of the other Credit Parties and which is
therefore unable or unwilling to vote with respect to an issue arising under
this Credit Agreement will agree to vote and will be deemed to have voted its
Credit Exposure under this Credit Agreement pro rata in accordance with the
percentage of Credit Exposure voted in favor of, and the percentage of Credit
Exposure voted against, any such issue under this Credit Agreement.
(d) If the Borrower shall have requested a waiver, consent, or
amendment from the Lenders of any of the matters described in clauses (i)
through (vii) of Section 13.11(a), and the Borrower shall have received such
waiver, consent, or amendment from Lenders holding greater than 50% of the Total
Credit Exposure (or in the case of such a waiver, consent or amendment relating
to a single Tranche, greater than 50% of the aggregate Credit Exposure of all
Lenders with respect to such Tranche), then with respect to any Lender that has
not consented (the "Non-Consenting Lenders"), the Borrower may, upon at least
five (5) Business Days' prior written or facsimile notice to such Lender and the
Administrative Agent, identify to the Administrative Agent a Purchasing Lender
which will purchase (for an amount, in immediately available funds, equal to the
principal amount of outstanding Loans payable to such Non-Consenting Lender,
plus all accrued but unpaid interest and fees payable to such Non-Consenting
Lender), the Commitments of such Non-Consenting Lender (if applicable), and such
Non-Consenting Lender shall thereupon assign any Loans owing to such
Non-Consenting Lender, its Commitments (if applicable) and any notes held by
such Non-Consenting Lender to such Purchasing Lender pursuant to Section 13.3
hereof; provided, that the consent of the Administrative Agent required pursuant
to Section 13.3 hereof shall not be unreasonably withheld.
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SECTION 13.12 Severability. Any provision of this Credit
Agreement or of any note evidencing any Loan hereunder which is invalid, illegal
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without invalidating the remaining provisions hereof, and any such invalidity,
illegality or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 13.13 SERVICE OF PROCESS. EACH PARTY HERETO (EACH A
"SUBMITTING PARTY") HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE
COURTS OF THE STATE OF NEW YORK IN NEW YORK COUNTY AND TO THE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK SITTING
IN NEW YORK COUNTY, FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING
ARISING OUT OF OR BASED UPON THIS CREDIT AGREEMENT (INCLUDING, BUT NOT LIMITED
TO, THE LETTERS OF CREDIT, THE SUBJECT MATTER HEREOF AND ANY OTHER FUNDAMENTAL
DOCUMENT AND THE SUBJECT MATTER THEREOF). EACH SUBMITTING PARTY TO THE EXTENT
PERMITTED BY APPLICABLE LAW (A) HEREBY WAIVES, AND AGREES NOT TO ASSERT, BY WAY
OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR OTHER
PROCEEDING BROUGHT IN THE ABOVE-NAMED COURTS, ANY CLAIM THAT IT IS NOT SUBJECT
PERSONALLY TO THE JURISDICTION OF SUCH COURTS, THAT ITS PROPERTY IS EXEMPT OR
IMMUNE FROM ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS
BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR
PROCEEDING IS IMPROPER OR THAT THIS CREDIT AGREEMENT, THE SUBJECT MATTER HEREOF
AND ANY OTHER FUNDAMENTAL DOCUMENT OR THE SUBJECT MATTER THEREOF (AS APPLICABLE)
MAY NOT BE ENFORCED IN OR BY SUCH COURT AND (B) HEREBY WAIVES THE RIGHT TO
ASSERT IN ANY SUCH ACTION, SUIT OR PROCEEDING ANY OFFSETS OR COUNTERCLAIMS
EXCEPT COUNTERCLAIMS THAT ARE COMPULSORY OR OTHERWISE ARISE FROM THE SAME
SUBJECT MATTER. EACH SUBMITTING PARTY HEREBY CONSENTS TO SERVICE OF PROCESS BY
MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN TO IT PURSUANT TO SECTION
13.1 HEREOF. EACH SUBMITTING PARTY AGREES THAT ITS SUBMISSION TO JURISDICTION
AND CONSENT TO SERVICE OF PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF
EACH OF THE OTHER SUBMITTING PARTIES. FINAL JUDGMENT AGAINST ANY SUBMITTING
PARTY IN ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE, AND MAY BE
ENFORCED IN ANY OTHER JURISDICTION (X) BY SUIT, ACTION OR PROCEEDING ON THE
JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE
FACT AND OF THE AMOUNT OF INDEBTEDNESS OR LIABILITY OF THE SUBMITTING PARTY
THEREIN DESCRIBED OR (Y) IN ANY OTHER MANNER PROVIDED BY OR PURSUANT TO THE LAWS
OF SUCH OTHER JURISDICTION; PROVIDED, HOWEVER, THAT THE ADMINISTRATIVE AGENT,
THE COLLATERAL AGENT, THE COLLATERAL MONITORING AGENT AND THE ISSUING BANK MAY
AT THEIR OPTION BRING SUIT, OR INSTITUTE OTHER JUDICIAL PROCEEDINGS AGAINST A
SUBMITTING PARTY OR ANY OF ITS ASSETS IN ANY STATE OR FEDERAL COURT OF THE
UNITED STATES OR OF ANY COUNTRY OR PLACE WHERE THE SUBMITTING PARTY OR SUCH
ASSETS MAY BE FOUND.
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SECTION 13.14 Headings. Section headings used herein and the
Table of Contents are for convenience only and are not to affect the
construction of or be taken into consideration in interpreting this Credit
Agreement.
SECTION 13.15 Execution in Counterparts. This Credit Agreement
may be executed in any number of counterparts, each of which shall constitute an
original, but all of which taken together shall constitute one and the same
instrument. Signature pages may be detached from counterpart documents and
reassembled to form duplicate executed originals. Delivery of an executed
signature page to this Credit Agreement by facsimile shall be as effective as
delivery of a manually executed counterpart of this Credit Agreement.
SECTION 13.16 Subordination of Intercompany Indebtedness,
Receivables and Advances. (a) Each Credit Party hereby agrees that any
intercompany Indebtedness or other intercompany receivables or intercompany
advances of any other Credit Party, directly or indirectly, in favor of such
Credit Party of whatever nature at any time outstanding shall be completely
subordinate in right of payment to the prior indefeasible payment in full of the
Obligations, and that no payment on any such Indebtedness, receivable or advance
shall be made until the prior indefeasible payment in full of all the
Obligations, termination of the Commitments and the expiration and/or
termination of all Letters of Credit (or the cash collateralization of the
outstanding Letters of Credit in an amount equal to 105% of the then current L/C
Exposure) (i) except intercompany receivables and intercompany advances
permitted pursuant to the terms hereof may be repaid and intercompany
Indebtedness permitted pursuant to the terms hereof may be repaid, in each case
so long as no Default or Event of Default, shall have occurred and be continuing
and (ii) except as specifically consented to by the Administrative Agent and the
Required Lenders in writing.
(b) In the event that any payment on any such Indebtedness
shall be received by such Credit Party other than as permitted by Section
13.16(a) hereof before payment in full of all Obligations, termination of the
Commitments and the expiration and/or termination of all Letters of Credit (or
the cash collateralization of the outstanding Letters of Credit in an amount
equal to 105% of the then current L/C Exposure), such Credit Party shall receive
such payments and hold the same in trust for, segregate the same from its own
assets and shall immediately pay over to, the Collateral Agent on behalf of the
Secured Parties all such sums to the extent necessary so that the Secured
Parties shall have been paid all Obligations owed or which may become owing.
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SECTION 13.17 Confidentiality. Each of the Lenders understands
that some of the information furnished to it pursuant to this Credit Agreement
may be received by it prior to the time that such information shall have been
made public, and each of the Lenders hereby agrees that it will keep all the
information received by it in connection with this Credit Agreement confidential
except that a Lender shall be permitted to disclose information (i) to such of
its officers, directors, employees, agents, representatives, auditors,
consultants, advisors, trustees, investments advisors, lawyers and affiliates as
need to know such information in connection with this Credit Agreement or any
other Fundamental Document; (ii) to a proposed assignee or participant in
accordance with Section 13.3(h) hereof; (iii) to the extent required by
Applicable Law and regulations or by any subpoena or other legal process (in any
which event such Lender shall promptly notify the Borrower to the extent not
prohibited by Applicable Law); (iv) to the extent requested by any bank
regulatory authority or other regulatory authority; (v) to the extent such
information (A) becomes publicly available other than as a result of a breach of
this Credit Agreement, (B) becomes available to such Lender on a nonconfidential
basis from a source other than the Borrower or any of its Affiliates, which
source is not known to such Lender to be prohibited from transmitting the
information to such Lender by any contractual or other obligation to the
Borrower or (C) was available to such Lender on a nonconfidential basis prior to
its disclosure to such Lender; (vi) to the extent the Borrower shall have
consented to such disclosure in writing; or (vii) in connection with the
servicing of the Loans hereunder, in protecting or enforcing any rights and/or
remedies in connection with any Fundamental Document or in any proceeding in
connection with any Fundamental Document or any of the transactions contemplated
thereby.
SECTION 13.18 Entire Agreement. This Credit Agreement
(including the Exhibits and Schedules hereto) represents the entire agreement of
the parties with regard to the subject matter hereof and the terms of any
letters and other documentation entered into between any of the parties hereto
(other than the Fee Letters) prior to the execution of this Credit Agreement
which relate to Loans to be made or Letters of Credit to be issued hereunder
shall be replaced by the terms of this Credit Agreement.
SECTION 13.19 Enforcement of Rights; No Obligation to Marshall
Assets. In enforcing any rights under this Credit Agreement or any other
Fundamental Document, neither the Agents, the Issuing Bank, any Lender nor any
of the other Secured Parties shall be required to resort to any particular
security, right or remedy through foreclosure or otherwise, or to proceed in any
particular order of priority, or to otherwise act or refrain from acting; and,
to the extent permitted by Applicable Law, each Credit Party hereby waives and
releases any right to a marshaling of assets or a sale in inverse order of
alienation.
SECTION 13.20 Reproduction of Documents. The Credit Agreement,
all documents constituting Schedules or Exhibits hereto, and all documents
relating hereto received by a party hereto, including, without limitation: (a)
consents, waivers and modifications that may hereafter be executed; (b) the
Fundamental Documents; and (c) financial statements, certificates, and other
information previously or hereafter furnished to any of the Agents, the Issuing
Bank, any Lender or any other Secured Party may be reproduced by the party
receiving the same by any photographic, photostatic, microfilm, micro-card,
miniature photographic or other similar process. Each of the parties hereto
agrees and stipulates that, to the extent permitted by Applicable Law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such party in the
regular course of business) and that, to the extent permitted by applicable law,
any enlargement, facsimile, or further reproduction of such reproduction shall
likewise be admissible in evidence.
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SECTION 13.21 Right of Set-Off. Subject to Section 12.3 upon
the occurrence and during the continuance of any Event of Default, the
Administrative Agent and each Lender is hereby authorized at any time and from
time to time, to the fullest extent permitted by law and without order of or
application to any court, to set-off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by the Administrative Agent and each such Lender
to or for the credit or the account of any Credit Party against any and all of
the Obligations, irrespective of whether or not such Lender shall have made any
demand under any Fundamental Document and although the Obligations may not have
been accelerated. The rights of each Lender and the Administrative Agent under
this Section are in addition to other rights and remedies which such Lender and
the Administrative Agent may have upon the occurrence and during the continuance
of any Event of Default.
[Signature Pages Follow]
139
BORROWER
GENESIS HEALTH VENTURES, INC.
BY /S/ GEORGE V. HAGER JR.
-------------------------
GUARANTORS:
ACADEMY NURSING HOME, INC.
ACCUMED, INC.
ADS APPLE VALLEY, INC.
ADS CONSULTING, INC.
ADS DANVERS ALF, INC
ADS DARTMOUTH ALF, INC.
ADS HINGHAM ALF, INC.
ADS HINGHAM NURSING FACILITY, INC.
ADS HOME HEALTH, INC.
ADS MANAGEMENT, INC.
ADS PALM CHELMSFORD, INC
ADS RECUPERATIVE WALTHAM, INC
ADS SENIOR HOUSING, INC.
ADS VILLAGE MANOR, INC.
ANR, INC.
APPLEWOOD HEALTH RESOURCES, INC.
ASCO HEALTHCARE OF NEW ENGLAND, INC.
ASCO HEALTHCARE, INC.
ASL, INC.
AUTOMATED PROFESSIONAL ACCOUNTS, INC.
BERKS NURSING HOMES, INC.
BETHEL HEALTH RESOURCES, INC.
BREYUT CONVALESCENT CENTER, INC.
BRIGHTWOOD PROPERTY, INC.
BRINTON MANOR, INC.
BURLINGTON WOODS CONVALESCENT CENTER, INC.
CARECARE, INC.
CAREFLEET, INC.
CENTURY CARE CONSTRUCTION, INC.
CENTURY CARE MANAGEMENT, INC.
CHATEAU VILLAGE HEALTH RESOURCES, INC.
CHELTENHAM LTC MANAGEMENT, INC.
CHG INVESTMENT CORP., INC.
CHNR-I, INC.
COLONIAL HALL HEALTH RESOURCES, INC.
COLONIAL HOUSE HEALTH RESOURCES, INC.
COMPASS HEALH SERVICES, INC.
CONCORD COMPANION CARE, INC.
CONCORD HEALTH GROUP, INC.
CONCORD HEALTHCARE SERVICES, INC.
CONCORD HOME HEALTH, INC.
CONCORD PHARMACY SERVICES, INC.
CONCORD REHAB, INC.
CONCORD SERVICES CORPORATION
CRESTVIEW CONVALESCENT HOME, INC.
CRESTVIEW NORTH, INC.
CRYSTAL CITY NURSING CENTER, INC.
CVNR, INC.
DAWN VIEW MANOR, INC.
DELCO APOTHECARY, INC.
DELM NURSING, INC.
DENTON HEALTHCARE CORPORATION
DERBY NURSING CENTER CORPORATION
DIANCE MORGAN AND ASSOCIATES, INC.
EASTERN MEDICAL SUPPLIES, INC.
EASTERN REHAB SERVICES, INC.
EIDOS, INC.
ELDERCARE RESOURCES CORP.
ELMWOOD HEALTH RESOURCE, INC.
ENCARE OF MASSACHUSETTES, INC.
ENCARE OF MENDHAM, INC.
ENCARE OF PENNYPACK, INC.
ENCARE OF QUAKERTOWN, INC.
ENCARE OF WYNCOTE, INC.
ENR, INC.
GENESIS ELDERCARE ADULT DAY HEALTH SERVICES, INC.
GENESIS ELDERCARE CENTERS I, INC.
GENESIS ELDERCARE CENTERS II, INC.
GENESIS ELDERCARE CENTERS III, INC.
GENESIS ELDERCARE CORP.
GENESIS ELDERCARE DIAGNOSTIC SERVICES, INC.
GENESIS ELDERCARE HOME CARE SERVICS, INC.
GENESIS ELDERCARE HOME HEATH SERVICES - SOUTHERN, INC.
GENESIS ELDERCARE HOSPITALITY SERVICES, INC.
GENESIS ELDERCARE LIVING FACILITIES, INC.
GENESIS ELDERCARE MANAGEMENT SERVICES, INC.
GENESIS ELDERCARE NATIONAL CENTERS, INC.
GENESIS ELDERCARE NETWORK SERVICES OF MASSACHUSETTS, INC.
GENESIS ELDERCARE NETWORK SERVICES, INC.
GENESIS ELDERCARE PARTNERSHIP CENTERS, INC.
GENESIS ELDERCARE PHYSICIAN SERVICES, INC.
GENESIS ELDERCARE PROPERTIES, INC.
GENESIS ELDERCARE REHABILITATION MANAGEMENT SERVICES, INC.
GENESIS ELDERCARE REHABILITATION SERVICES, INC.
GENESIS ELDERCARE STAFFING SERVICES, INC.
GENESIS ELDERCARE TRANPORTATION SERVICES, INC.
GENESIS HEALTH SERVICES CORPORATION
GENESIS HEALTH VENTURES OF ARLINGTON, INC.
GENESIS HEALTH VENTURES OF BLOOMFIELD, INC.
GENESIS HEALTH VENTURES OF CLARKS SUMMIT, INC.
GENESIS HEALTH VENTURES OF INDIANA, INC.
GENESIS HEALTH VENTURES OF LANHAM, INC.
GENESIS HEALTH VENTURES OF MASSACHUSETTS, INC.
GENESIS HEALTH VENTURES OF NAUGATUCK, INC.
GENESIS HEALTH VENTURES OF NEW GARDEN, INC.
GENESIS HEALTH VENTURES OF POINT PLEASANT, INC.
GENESIS HEALTH VENTURES OF SALISBURY, INC.
GENESIS HEALTH VENTURES OF WAYNE, INC.
GENESIS HEALTH VENTURES OF WEST VIRGINIA, INC.
GENESIS HEALTH VENTURES OF WILKES-BARRE, INC.
GENESIS HEALTH VENTURES OF WINDSOR, INC.
GENESIS HEALTHCARE CENTERS HOLDINGS, INC.
GENESIS HOLDINGS, INC.
GENESIS IMMEDIATE MED CENTER, INC.
GENESIS PROPERTIES OF DELAWARE CORPORATOIN
GENESIS SELECTCARE CORP.
GENESIS / VNA PARTNERSHIP HOLDINGS COMPANY, INC.
GENESIS - CROZER PARTNERSHIP HOLDING COMPANY, INC.
GERIATRIC & MEDICAL COMPANIES, INC.
GERIATRIC AND MEDICAL SERVICES, INC.
GERIATRIC AND MEDICAL INVESTMENTS CORPORATION
GERIMED CORP.
GHV AT SALSIBURY CENTER, INC.
GLENMARK ASSOCIATES - DAWN VIEW MANOR, INC.
GLENMARK ASSOCIATES, INC.
GLENMARK PROPERTIES, INC.
GMA - BRIGHTWOOD, INC.
GMA - CONSTRUCTION, INC.
GMA - MADISON, INC.
GMA - UNIONTOWN, INC.
GMA PARTNERSHIP HOLDING COMPANY, INC.
GMC LEASING CORPORATION
GMC MEDICAL CONSULTING SERVICES, INC.
GMC 0 LTC MANAGEMENT, INC.
GMS INSURANCE SERVICES, INC.
GMS MANAGEMENT, INC.
GMS MANAGEMENT - TUCKER, INC.
GOVERNOR'S HOUSE NURSIN HOME, INC.
H.O. SUBSIDIARY, INC.
HEALTH CONCEPTS AND SERVICES, INC.
HEALTH RESOURCES OF ACADAMEY MANOR, INC.
HEALTH RESOURCES OF ARCADIA, INC.
HEALTH RESOURCES OF BOARDMAN, INC.
HEALTH RESOURCES OF BRIDGETON, INC.
HEALTH RESOURCES OF BROOKLYN, INC.
HEALTH RESOURCES OF CEDAR GROVE, INC.
HEALTH RESOURCES OF CINNAMISON, INC.
HEALTH RESOURCES OF COLCHESTER, INC.
HEALTH RESOURCES OF COLUMBUS, INC.
HEALTH RESOURCES OF CUMBERLAND, INC.
HEALTH RESOURCES OF EATONTOWN, INC.
HEALTH RESOURCES OF ENGLEWOOD, INC.
HEALTH RESOURCES OF EWING, INC.
HEALTH RESOURCES OF FARMINGTON, INC.
HEALTH RESOURCES OF GARDNER, INC.
HEALTH RESOURCES OF GLASTONBURY, INC.
HEALTH RESOURCES OF GROTON, INC.
HEALTH RESOURCES OF JACKSON, INC.
HEALTH RESOURCES OF KARMENTA AND MADISON, INC.
HEALTH RESOURCES OF LAKEVIEW, INC.
HEALTH RESOURCES OF LEMONT, INC.
HEALTH RESOURCES OF LYNN, INC.
HEALTH RESOURCES OF MARCELLA, INC.
HEALTH RESOURCES OF MIDDLETOWN (RI), INC.
HEALTH RESOURCES OF MONTCLAIR, INC.
HEALTH RESOURCES OF MORRISTOWN, INC.
HEALTH RESOURCES OF NORFOLK, INC.
HEALTH RESOURCES OF NORTH ANDOVER, INC.
HEALTH RESOURCES OF NORWALK, INC.
HEALTH RESOURCES OF PENNINGTON, INC.
HEALTH RESOURCES OF RIDGEWOOD, INC.
HEALTH RESOURCES OF ROCKVILLE, INC.
HEALTH RESOURCES OF SOLOMONT / BROOKLINE, INC.
HEALTH RESOURCES OF SOUTH BRUNSWICK, INC.
HEALTH RESOURCES OF TROY HILLS, INC.
HEALTH RESOURCES OFVOORHEES, INC.
HEALTH RESOURCES OF WALLINGFORD, INC.
HEALTH RESOURCES OF WARWICK, INC.
HEALTH RESOURCES OF WESTWOOD, INC.
HEALTHCARE REHAB SYSTEMS, INC.
HEALTHCARE RESOURCES CORP.
HEALTHOBJECTS CORPORATION
HELSTAT, INC.
HILLTOP HEALTH CARE CENTER, INC.
HMNH REALTY, INC.
HNCA, INC.
HORIZON ASSOCIATES, INC.
HORIZON MEDICAL EQUIPMENT AND SUPPLY, INC.
HORIZON MOBIL, INC.
HORIZON REHABILITATION, INC.
HR OF CHARLESTON, INC.
HRWV HUNTINGTON, INC.
INNOVATIVE HEALTH CARE MARKETING, INC.
INNOVATIVE PHARMACY SERVICES, INC.
INSTITUTIONAL HEALTH CARE SERVICES, INC.
KEYSTONE NURSING HOME, INC.
KNOLLWOOD MANOR, INC.
KNOLLWOOD NURSING HOME, INC.
LAKE MANOR, INC.
LAKEWOOD HEALTH RESOURCES, INC.
LAUREL HEALTH RESOURCES, INC.
LEHIGH NURSING HOMES, INC.
LIFE SUPPORT MEDICAL EQUIPMENT, INC.
LIFE SUPPORT MEDICAL, INC.
LINCOLN NURSING HOME, INC.
LRC HOLDING COMPANY
LWNR, INC.
MABRI CONVALESCENT CENTER, INC.
MADISON AVENUE ASSISTED LIVING, INC.
MANOR MANAGEMENT CORPORATION OF GEORGIAN MANOR, INC.
MARLINTON PARTNERSHIP HOLDING COMPANY, INC.
MARLINTON ASSOCIATES, INC.
MARSHFIELD HEALTH RESOURCES, INC.
MCKERLEY HEALTH CARE CENTER - CONCORD, INC.
MCKERLEY HEALTH CARE CENTERS, INC.
MEDICAL SERVICES GROUP, INC.
MERIDIAN HEALTH, INC.
MERIDIAN HEALTHCARE INVESTMENTS, INC.
MERIDIAN HEALTHCARE, INC.
METRO PHARMACEUTICALS, INC.
MHNR, INC.
MNR, INC.
MONTGOMERY NURSING HOME, INC.
MULTICARE ACQUISITION CORP.
MULTICARE AMC, INC.
MULTICARE HOME HEALTH OF ILLINOIS, INC.
MULTICARE MEMBER HOLDING CORP.
MULTICARE PAYROLL CORP.
NATIONAL PHARMACY SERVICE, INC.
NEIGHBORCARE OF INDIANA, INC.
NEIGHBORCARE INFUSION SERVICES, INC.
NEIGHBORCARE OF NORTHERN CALFIFORNIA, INC.
NEIGHBORCARE OF OKLAHOMA, INC.
NEIGHBORCARE OF VIRGINIA, INC.
NEIGHBORCARE OF WISCONSIN, INC.
NEIGHBORCARE PHARMACY SERVICES, INC.
NEIGHBORCARE PHARMACIES, INC.
NEIGHBORCARE-MEDISCO, INC.
NEIGHBORCARE-ORCA, INC.
NEIGHBORCARE-TCI, INC.
NETWORK AMBULANCE SERVICES, INC.
NORTH MADISON, INC.
NORTHWESTERN MANAGEMENT SERVICES, INC.
NURSING AND RETIREMENT CENTER OF THE ANDOVERS, INC.
PHARMACY EQUITIES, INC.
PHC OPERATING CORP.
PHILADELPHIA AVENUE CORPORATION
POCAHONTAS CONTINUOUS CARE CENTER, INC.
POMPTON CARE, INC.
PRESCOTT NURSING HOME, INC.
PROFESSIONAL PHARMACY SERVICES, INC.
PROGRESSIVE REHABILIATION CENTER, INC.
PROPSECT PARK LTC MANAGEMENT INC.
PROVIDENCE FUNDING CORPORATION
PROVIDENCE HEALTH CARE, INC.
PROVIDENCE MEDICAL, INC.
QUAKERTOWN MANOR CONVALESCENT AND REHABILITATION, INC.
REST HAVEN NURSING HOME, INC.
RIDGELAND HEALTH RESOURCES, INC.
RIVER PINES HEALTH RESOURCES, INC.
RIVERSHORES HEALTH RESOURCES, INC.
RLNR, INC.
ROEPHEL CONVALESCNENT CENTER, INC.
ROSE HEALTHCARE, INC.
ROSE VIEW MANOR, INC.
ROXBOROUGH NURSING HOME, INC.
RSNR, INC.
RVNR, INC.
S.T.B. INVESTORS, LTD
SCHUYLKILL NURSING HOMES, INC.
SCHUYLKILL PARTNERSHIP ACQUISTION CORP.
SCOTCHWOOD INSTITUTIONAL SERVICES, INC.
SCOTCHWOOD MASSACHUSETTS HOLDINGS CO., INC.
SENIOR LIVIN VENTURES, INC.
SENIOR SOURCE, INC.
SNOW VALLEY HEALTH RESOURCES, INC.
SOLOMONT FAMILY MEDFORD VENTURE, INC.
STAFFORD CONVALESCENT CENTER, INC.
STATE STREET ASSOCIATES, INC.
SUBURBAN MEDICAL SERVICES, INC.
SVNR, INC.
THE ADS GROUP, INC.
THE APPLE VALLEY PARTNERSHIP HOLDING COMPANY, INC.
THE ASSISTED LIVING ASSOCIATES OF BERKSHIRE, INC.
THE ASSISTED LIVING ASSOCIATES OF LEHIGH, INC.
THE ASSISTED LIVING ASSOCIATES OF SANATOGA, INC.
THE HOUSE OF CAMPBELL, INC.
THE MULTICARE COMPANIES, INC.
THERAPY CARE, INC.
THE TIDEWATER HEALTHCARE SHARED SERVICES GROUP, INC.
TMC ACQUSITION CORP.
TRANSPORT SERVICES, INC.
TRI STATE MOBILE MEDICAL SERVICES, INC.
UNITED HEALTH CARE SERVICES, INC.
VALLEY MEDICAL SERVICES, INC.
VALLEY TRANSPORT AMBULANCE SERVICE, INC.
VERSALINK, INC.
VILLAS REALTY & INVESTMENTS, INC.
WALNUT LTC MANAGEMENT, INC.
WAYSIDE NURSING HOME, INC.
WEISENFLUH AMBULANCE SERVICE, INC.
WEST PHILA. LTC MANAGEMENT, INC.
WESTFORD NURSING AND RETIRMENT CENTER, INC.
WILLOW MANOR NURSING HOME, INC.
WYNCOTE HEALTHCARE CORP.
YORK LTC MANAGEMENT, INC.
BY: /S/ GEORGE V. HAGER JR.
-----------------------
NAME:
On behalf of each of the foregoing entities as an Authorized
Signatory of such entities
ADS APPLE VALLEY LIMITED PARTNERSHIP, by ADS Apple Valley,
Inc., its General Partner
ADS DARTMOUTH GENERAL PARTNERSHIP, by ADS Senior Housing, Inc.
and ADS Dartmouth ALF, Inc., its General Partners
ADS HINGHAM LIMITED PARTNERSHIP, by ADS Hingham Nursing
Facility, Inc., its General Partner
ADS RECUPERATIVE CENTER LIMITED PARTNERSHIP, by ADS
Recuperative Center, Inc., its General Partner
ARCADIA ASSOCIATES, by ADS / Multicare, Inc. and Health
Resources of Arcadia, Inc., its General Partners
ASCO HEALTHCARE OF NEW ENGLAND, LIMITED PARTNERSHIP, by ASCO
Healthcare of New England, Inc., its General Partner
BREVARD MERIDIAN LIMITED PARTNERSHIP, by Meridian Healthcare,
Inc., its General Partner
CARE HAVEN ASSOCIATES LIMITED PARTNERSHIP, by Glenmark
Associates, Inc. and GMA Partnership Holding Company, Inc.,
its General Partners
CARE4 L.P., by Institutional Health Care Services, Inc., its
General Partner
CATONSVILLE MERIDIAN LIMITED PARTNERSHIP, by Meridian Health,
Inc. and Meridian Healthcare, Inc. its General Partners
CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P., by Health
Resources of Cumberland, Inc., its General Partner
EASTON MERIDIAN LIMITED PARTNERSHIP, by Meridian Health, Inc.
and Meridian Healthcare, Inc. its General Partners
EDELLA STREET ASSOCIATES, by Genesis Health Ventures of Clarks
Summit, Inc., its General Partner
GENESIS ELDERCARE CENTERS I, L.P.., by Genesis Eldercare
Partnership Centers, Inc., its General Partner
GENESIS ELDECARE CENTERS II L.P.., by Genesis Eldercare
Partnership Centers, Inc., its General Partner
GENESIS ELDECARE CENTERS III L.P.., by Genesis Eldercare
Partnership Centers, Inc., its General Partner
GENESIS HEALTH VENTURES OF WEST VIRGINIA, LIMITED PARTNERSHIP,
by Genesis Eldercare Network Services, Inc. and Genesis
Eldercare Rehabilitation Services, Inc., its General Partners
GENESIS PROPERTIES LIMITED PARTNERSHIP, by Genesis Health
Ventures of Arlington, Inc., its General Partner
GENESIS PROPERTIES OF DELWARE LTD. PARTNERSHIP, L.P., by
Genesis Properties of Delaware Corporation, its General
Partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP, by Glenmark
Associates, Inc. and GMA Partnership Holding Company, Inc.,
its General Partners
GREENSPRING MERIDIAN LIMITED PARTERSHIP, by Meridian
Healthcare Inc., it General Partner
GROTON ASSOCIATES OF CONNECTICUT, L.P., by Health Resources of
Groton, Inc., its General Partner
HALLMARK HEALTHCARE LIMITED PARTNERSHIP, by Pharmacy Equities,
Inc, its General Partner
HAMMONDS LANE MERIDIAN LIMITED PARTNERSHIP, by Meridian
Healthcare, Inc. and Meridian Health, Inc. its General
Partners
HOLLY MANOR ASSOCIATES OF NEW JERSEY, L.P., by Encare of
Mendham, L.L.C. its General Partner
LAKE WASHINGTON, LTD., by Lake Manor, its General Partner
MCKERLEY HEALTH FACILITIES, by Merdian Health, Inc., and
Meridian Healthcare, Inc., its General Partners
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P., by Breyut
Convalescent Center, L.L.C., its General Partner
MERIDIAN EDGEWOOD LIMITED PARTNERSHIP, by Meridian Healthcare,
Inc., its General Partner
MERIDIAN PERRING LIMITED PARTERSHIP, by Meridian Healthcare,
Inc., its General Partner
MERIDIAN VALLEY LIMITED PARTERSHIP, by Meridian Healthcare,
Inc., its General Partner
MERIDIAN VALLEY VIEW LIMITED PARTNERSHIP, by Meridian
Healthcare, Inc., its General Partner
MERIDIAN / CONSTELLATION LIMITED PARTNERSHIP, by Meridian
Healthcare, Inc., and Meridian Health Inc., its General
Partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P. by Health
Resources of Middletown (R.I.), Inc., its General Partner
MILLVILLE MERIDIAN LIMITED PARTNERSHIP, by Meridian
Healthcare, Inc., its General Partner
NORRISTOWN NURSING AND REHABILITIATION CENTER ASSOCIATES,
L.P., by GMC-LTC Management, Inc., its General Partner
PHILADELPHIA AVENUE ASSOCIATES, by Philadelphia Avenue
Corporation, its General Partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP, by Glenmark
Associates, Inc., its General Partner
POMPTON ASSOCIATES, L.P., by Pompton Care L.L.C., its General
Partner
RALEIGH MANOR LIMITED PARTNERSHIP, by Glenmark Associates,
Inc. its General Partner
RIVER STREET ASSOCIATES, by Genesis Health Ventures of
Wilkes-Barre, Inc., its General Partner
ROMNEY HEALTH CARE CENTER LTD., LIMITED PARTNERSHIP, by
Glenmark Associates, Inc., its General Partner
SEMINOLE MERIDIAN LIMITED PARTNERSHIP, by Meridian Health,
Inc., its General Partner
SISTERVILLE HAVEN LIMITED PARTNERSHIP, by Glenmark Associates,
Inc., its General Partner
STATE STREET ASSOCIATIES, L.P., by State Street Associates,
Inc., its General Partner
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP, by Glenmark
Associates, Inc., its General Partner
THE STRAUSS GROUP - HOPKINS HOUSE, L.P., by Encare of Wyncote,
Inc., its General Partner
THE STRAUS GROUP - OLD BRIDGE, L.P., by Health Resources of
Emery, L.L.C., its General Partner
THE STRAUS GROUP - RIDGEWOOD, L.P., by Health Resources of
Ridgewood, L.L.C., its General Partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P., by Health
Resources of Wallingford, Inc, its General Partner
THERAPY CARE SYSTEMS, L.P., Genesis ElderCare Rehabilitation
Services, Inc., its General Partner
VOLUSIA MERIDIAN LIMITED PARTNERSHIP, by Meridian Health,
Inc., its General Partner
WARWICK ASSOCIATES OF RHODE ISLAND L.P., by Health Resources
of Warwick, Inc., its General Partner.
By: /S/ GEORGE V. HAGER, JR.
------------------------
Name:
On behalf of each of the foregoing entities as an Authorized
Signatory of each respective authorized General Partner
AUTOMATED HOMECARE SYSTEMS, LLC, by Health Objects
Corporation, its authorized Member.
BREYUT CONVALESCENT CENTER L.L.C., by The Multicare Companies,
Inc. and Stafford Convalescent Center, Inc., its authorized
Members.
ENCARE OF MENDHAM, L.L.C., by The Multicare Companies, Inc.
and Stafford Convalescent Center, Inc., its authorized Members
GENESIS ELDERCARE EMPLOYMENT SERVICES, L.L.C., by Genesis
ElderCare Management Services, Inc., its authorized Member
GENESIS-GEORGETOWN SNF/JV, L.L.C., by Genesis Health Ventures,
Inc, its authorized Member.
GLENMARK LIMITED LIABILITY COMPANY I, by Glenmark Associates,
Inc. and Horizon Associates, Inc. its authorized Members
HEALTH RESOURCES OF BRIDGETON, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF CINNAMINSON, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF EMERY, L.L.C. by The Multicare Companies,
Inc. and Stafford Convalescent Center, Inc., its authorized
Members
HEALTH RESOURCES OF ENGLEWOOD, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF EWING, L.L.C. by The Multicare Companies,
Inc. and Stafford Convalescent Center, Inc., its authorized
Members
HEALTH RESOURCES OF FAIRLAWN, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF JACKSON, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF LAKEVIEW, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF RIDGEWOOD, L.L.C. by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
HEALTH RESOURCES OF ORANGE, L.L.C. by The Multicare Companies,
Inc. and Stafford Convalescent Center, Inc., its authorized
Members
MAIN STREET PHARMACY, L.L.C., by Professional Pharmacy
Services, Inc. and NeighborCare Pharmacies, Inc., its
authorized Members
POMPTON CARE L.L.C., by The Multicare Companies, Inc. and
Stafford Convalescent Center, Inc., its authorized Members
RESPIRATORY HEALTH SERVICES, L.L.C., by Genesis Health
Ventures, Inc., its authorized Member
ROEPHEL CONVALESCENT CENTER L.L.C., by The Multicare
Companies, Inc. and Stafford Convalescent Center, Inc., its
authorized Members
TOTAL REHABILITATION CENTER L.L.C. by The Multicare Companies,
Inc. and Stafford Convalescent Center, Inc., its authorized
Members
By: /S/ GEORGE V. HAGER, JR.
------------------------
Name:
On behalf of each of the foregoing entities as an Authorized
Signatory of each respective authorized Member.
AGENTS AND ARRANGERS:
FIRST UNION NATIONAL BANK, as Administrative Agent, Collateral
Agent and Lender
By: /S/ ANDREW J. GAMBLE
---------------------
Name: Andrew J. Gamble
Title: SVP
Revolving Credit Commitment: $ 31,250,000.00
Term Loan B Commitment $109,939,726.03
Delayed Draw Term Loan $ 30,860,273.97
Total Commitment: $171,050,000.00
FIRST UNION SECURITIES, INC., as Co-Lead Arranger
By: /S/ ANDREW J. GAMBLE
---------------------
Name: Andrew J. Gamble
Title:
GOLDMAN SACHS CREDIT PARTNERS L.P., as Co-Lead Arranger,
Syndication Agent and Lender
By: /S/ Stephen P. Hickey
-----------------------
Name: Stephen P. Hickey
Title: Authorized Signatory
Revolving Credit Commitment: $ 31,250,000.00
Term Loan B Commitment $109,939,726.03
Delayed Draw Term Loan $ 30,860,273.97
Total Commitment: $171,050,000.00
GENERAL ELECTRIC CAPTIAL CORPORATION, as Collateral Monitoring
Agent, Co-Documentation Agent and Lender
By: /S/ Brian S. Beckswith
-----------------------
Name: Brian S. Beckswith
Its Duly Authorized Signatory
Revolving Credit Commitment: $ 25,000,000.00
Term Loan B Commitment $ 19,520,547.95
Delayed Draw Term Loan $ 5,479,452.05
Total Commitment: $ 50,000,000.00
CITICORP USA, INC., as Co-Documentation Agent and Lender
By: /S/ JAMES J. MCCARTHY
----------------------
Name: James J. McCarthy
Its Duly Authorized Signatory
Revolving Credit Commitment: $ 20,000,000.00
Term Loan B Commitment $ 11,712,328.77
Delayed Draw Term Loan $ 3,287,671.23
Total Commitment: $ 35,000,000.00
UBS AG, STAMFORD BRANCH., as Lender
By: /S/ PATRICIA O'KICKI
---------------------
Name: Partricia O'Kicki
Title: Director - Banking Products Services
By: /S/ Lynne B. Alfarone
Name: Lynne B. Alfarone
Title: Associate Director - Banking Products Services, US
Revolving Credit Commitment: $ 15,000,000.00
Term Loan B Commitment $ 3,904,109.59
Delayed Draw Term Loan $ 1,095,890.41
Total Commitment: $ 20,000,000.00
LEHMAN COMMERICAL PAPER, INC., as Lender
By: /S/ MICHELE SWANSON
---------------------
Name: Michele Swanson
Title: Authorized Signatory
Revolving Credit Commitment: $ 15,000,000.00
Term Loan B Commitment $ 0.00
Delayed Draw Term Loan $ 0.00
Total Commitment: $ 15,000,000.00
FOOTHILL INCOME TRUST, L.P.
BY: FIT GP, LLC, its General Partner
By: /S/ M.E. STEAMS
----------------
Name: M.E. Steams
Title: Managing Member
Revolving Credit Commitment: $ 6,250,000.00
Term Loan B Commitment $ 7,808,219.18
Delayed Draw Term Loan $ 2,191,780.82
Total Commitment: $ 15,250,000.00
FOOTHILL INCOME TRUST II, L.P.
BY: FIT II GP, LLC, its General Partner
By: /S/ M.E. STEAMS
----------------
Name: M.E. Steams
Title: Managing Member
Revolving Credit Commitment: $ 6,250,000.00
Term Loan B Commitment $ 7,808,219.18
Delayed Draw Term Loan $ 2,191,780.82
Total Commitment: $ 15,250,000.00
KZH STERLING LLC., as Lender
By: /S/ SUSAN LEE
-----------------
Name: Susan Lee
Title: Authorized Agent
Revolving Credit Commitment: $ 0.00
Term Loan B Commitment $ 2,342,465.75
Delayed Draw Term Loan $ 675,534.25
Total Commitment: $ 3,000,000.00
KZH CYPRESSTREE - I LLC., as Lender
By: /S/ SUSAN LEE
------------------
Name: Susan Lee
Title: Authorized Agent
Revolving Credit Commitment: $ 0.00
Term Loan B Commitment $ 3,904,109.59
Delayed Draw Term Loan $ 1,095,890.41
Total Commitment: $ 5,000,000.00
KZH SOLEIL LLC., as Lender
By: /S/ SUSAN LEE
-------------------
Name: Susan Lee
Title: Authorized Agent
Revolving Credit Commitment: $ 0.00
Term Loan B Commitment $ 819,863.01
Delayed Draw Term Loan $ 230,136.99
Total Commitment: $ 1,050,000.00
KZH SOLEIL - 2 LLC., as Lender
By: /S/ SUSAN LEE
-------------------
Name: Susan Lee
Title: Authorized Agent
Revolving Credit Commitment: $ 0.00
Term Loan B Commitment $ 1,054,109.59
Delayed Draw Term Loan $ 295,890.41
Total Commitment: $ 1,350,000.00
PINEHURST TRADING, INC., as Lender
By: /S/ KELLY C. WALKER
--------------------
Name: Kelly C. Walker
Title: Vice President
Its Duly Authorized Signatory
Revolving Credit Commitment: $ 0.00
Term Loan B Commitment $ 3,123,287.67
Delayed Draw Term Loan $ 876,712.33
Total Commitment: $ 4,000,000.00
STANWICH LOAN FUNDING LLC., as Lender
By: /S/ KELLY C. WALKER
--------------------
Name: Kelly C. Walker
Title: Vice President
Its Duly Authorized Signatory
Revolving Credit Commitment: $ 0.00
Term Loan B Commitment $ 3,123,287.67
Delayed Draw Term Loan $ 876,712.33
Total Commitment: $ 4,000,000.00
TABLE OF CONTENTS
Page
PARTIES..........................................................................................................1
INTRODUCTORY STATEMENT...........................................................................................1
1. DEFINITIONS.............................................................................................2
2. THE LOANS..............................................................................................31
SECTION 2.1 B Term Loans.....................................................................31
SECTION 2.2 Revolving Credit Loans...........................................................32
SECTION 2.3 Delayed Draw Term Loans..........................................................32
SECTION 2.4 Disbursement of Funds and Notice of Borrowing....................................33
SECTION 2.5 Interest Rate Type of the Loans..................................................34
SECTION 2.6 Repayment; Evidence of Debt; Administration......................................34
SECTION 2.7 Interest.........................................................................35
SECTION 2.8 Commitment Fees, Facility Fee and Other Fees.....................................36
SECTION 2.9 .................................................................................37
SECTION 2.10 Voluntary Prepayments............................................................37
SECTION 2.11 Mandatory Prepayments............................................................38
SECTION 2.12 Amortization.....................................................................41
SECTION 2.13 Default Interest; Alternate Rate of Interest.....................................44
SECTION 2.14 Continuation and Conversion of Loans.............................................44
SECTION 2.15 Reimbursement of Lenders.........................................................46
SECTION 2.16 Change in Circumstances..........................................................46
SECTION 2.17 Change in Legality...............................................................49
SECTION 2.18 United States Withholding........................................................49
SECTION 2.19 Interest Adjustments.............................................................52
SECTION 2.20 Manner of Payments...............................................................52
SECTION 2.21 Letters of Credit................................................................52
3. REPRESENTATIONS AND WARRANTIES OF CREDIT PARTIES.......................................................58
SECTION 3.1 Existence and Power..............................................................58
SECTION 3.2 Authority and No Violation.......................................................59
SECTION 3.3 Governmental Approval............................................................59
SECTION 3.4 Binding Agreements...............................................................60
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SECTION 3.5 No Material Adverse Effect.......................................................60
SECTION 3.6 Financial Information............................................................61
SECTION 3.7 Credit Parties and their Subsidiaries............................................61
SECTION 3.8 Patents, Trademarks, Copyrights and Other Rights.................................62
SECTION 3.9 Fictitious Names.................................................................62
SECTION 3.10 Title to Properties..............................................................62
SECTION 3.11 Special Representations Relating to Receivables..................................63
SECTION 3.12 Litigation; Judgments............................................................64
SECTION 3.13 Federal Reserve Regulations......................................................64
SECTION 3.14 Investment Company Act...........................................................64
SECTION 3.15 Taxes............................................................................65
SECTION 3.16 Compliance with ERISA............................................................65
SECTION 3.17 Agreements.......................................................................65
SECTION 3.18 Security Interest................................................................66
SECTION 3.19 Disclosure.......................................................................66
SECTION 3.20 Environmental Matters............................................................67
SECTION 3.21 Pledged Securities...............................................................68
SECTION 3.22 Compliance with Laws; Third Party Payor Arrangements.............................69
SECTION 3.23 Projected Financial Information..................................................69
SECTION 3.24 Real Property....................................................................69
SECTION 3.25 No Default.......................................................................70
SECTION 3.26 Labor Matters....................................................................70
SECTION 3.27 Organizational Documents.........................................................70
SECTION 3.28 Bank Accounts....................................................................70
4. CONDITIONS TO THE EFFECTIVENESS OF THIS CREDIT AGREEMENT AND THE MAKING OF THE LOANS...................70
SECTION 4.1 Conditions Precedent to the Effectiveness of This Credit
Agreement and the Making of the Loans............................................70
SECTION 4.2 Conditions Precedent to Each Revolving Credit Loan and each Letter of Credit.....75
SECTION 4.3 Conditions Precedent to the Making of Delayed Draw Term Loans....................76
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5. AFFIRMATIVE COVENANTS..................................................................................77
SECTION 5.1 Financial Statements and Reports.................................................77
SECTION 5.2 Compliance with Laws.............................................................80
SECTION 5.3 Maintenance of Properties........................................................80
SECTION 5.4 Notice of Material Events........................................................81
SECTION 5.5 Insurance........................................................................82
SECTION 5.6 Books and Records................................................................82
SECTION 5.7 Observance of Agreements.........................................................83
SECTION 5.8 Taxes and Charges................................................................83
SECTION 5.9 Liens............................................................................84
SECTION 5.10 Further Assurances; Security Interests...........................................84
SECTION 5.11 Environmental Laws...............................................................84
SECTION 5.12 Subsidiaries.....................................................................85
SECTION 5.13 Lease Agreements.................................................................86
SECTION 5.14 Interest Rate Protection.........................................................86
SECTION 5.15 After-Acquired Real Property Assets..............................................86
SECTION 5.16 Lender Meetings..................................................................86
SECTION 5.17 Use of Proceeds of Revolving Credit Loans........................................86
SECTION 5.18 Cash Management System...........................................................86
SECTION 5.19 Subordination, Non-Disturbance and Attornment Agreements, Etc....................87
SECTION 5.20 ERISA Plan Compliance and Reports................................................87
SECTION 5.21 Covenant Regarding Certain Pot-Closing Matters...................................87
6. NEGATIVE COVENANTS.....................................................................................88
SECTION 6.1 Limitations on Indebtedness and Preferred Stock..................................88
SECTION 6.2 Limitations on Liens.............................................................89
SECTION 6.3 Limitation on Guaranties.........................................................91
SECTION 6.4 Limitations on Investments.......................................................92
SECTION 6.5 Restricted Payments..............................................................92
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SECTION 6.6 Limitation on Leases.............................................................93
SECTION 6.7 Merger, Sale of Assets, Purchases, etc...........................................93
SECTION 6.8 Places of Business; Change of Name...............................................95
SECTION 6.9 Limitations on Capital Expenditures..............................................95
SECTION 6.10 Minimum Consolidated EBITDAR.....................................................96
SECTION 6.11 Maximum Total Leverage Ratio.....................................................97
SECTION 6.12 Maximum Senior Leverage Ratio....................................................97
SECTION 6.13 Minimum Consolidated Fixed Charge Coverage Ratio.................................98
SECTION 6.14 Minimum Consolidated Net Worth...................................................98
SECTION 6.15 Transactions with Affiliates.....................................................98
SECTION 6.16 Business Activities..............................................................98
SECTION 6.17 Joint Ventures or Partnerships...................................................98
SECTION 6.18 Receivables......................................................................99
SECTION 6.19 Sale and Leaseback...............................................................99
SECTION 6.20 Changes to Credit and Collection Policy and Material Agreements..................99
SECTION 6.21 ERISA Compliance................................................................100
SECTION 6.22 Hazardous Materials.............................................................100
SECTION 6.23 Use of Proceeds of Loans........................................................100
SECTION 6.24 Fiscal Year; Fiscal Quarter.....................................................100
7. EVENTS OF DEFAULT.....................................................................................100
8. GRANT OF SECURITY INTEREST; REMEDIES..................................................................103
SECTION 8.1 Security Interests..............................................................104
SECTION 8.2 Use of Collateral...............................................................104
SECTION 8.3 Cash Management System..........................................................104
SECTION 8.4 Credit Parties to Hold in Trust.................................................105
SECTION 8.5 Collections, etc................................................................105
SECTION 8.6 Possession, Sale of Collateral, etc.............................................106
SECTION 8.7 Application of Proceeds on Default..............................................106
SECTION 8.8 Power of Attorney...............................................................107
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SECTION 8.9 Financing Statements, Direct Payments...........................................107
SECTION 8.10 Further Assurances..............................................................108
SECTION 8.11 Termination and Release.........................................................108
SECTION 8.12 Remedies Not Exclusive..........................................................108
SECTION 8.13 Continuation and Reinstatement..................................................108
9. GUARANTY..............................................................................................108
SECTION 9.1 Guaranty........................................................................108
SECTION 9.2 No Impairment of Guaranty, etc..................................................110
SECTION 9.3 Continuation and Reinstatement, etc.............................................110
SECTION 9.4 Limitation on Guaranteed Amount etc.............................................110
10. PLEDGE................................................................................................111
SECTION 10.1 Pledge..........................................................................111
SECTION 10.2 Covenant........................................................................111
SECTION 10.3 Registration in Nominee Name; Denominations.....................................111
SECTION 10.4 Voting Rights; Dividends; etc...................................................111
SECTION 10.5 Remedies Upon Default...........................................................113
SECTION 10.6 Application of Proceeds of Sale and Cash........................................114
SECTION 10.7 Securities Act, etc.............................................................114
SECTION 10.8 Continuation and Reinstatement..................................................114
SECTION 10.9 Termination.....................................................................114
11. CASH COLLATERAL.......................................................................................115
SECTION 11.1 Cash Collateral Account.........................................................115
SECTION 11.2 Investment of Funds.............................................................115
SECTION 11.3 Grant of Security Interest......................................................116
SECTION 11.4 Remedies........................................................................116
12. THE AGENTS AND THE ISSUING BANK.......................................................................116
SECTION 12.1 Administration by the Agents....................................................116
SECTION 12.2 Advances and Payments...........................................................117
SECTION 12.3 Sharing of Setoffs and Cash Collateral..........................................118
SECTION 12.4 Notice to the Lenders...........................................................118
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SECTION 12.5 ................................................................................119
SECTION 12.6 Reimbursement and Indemnification...............................................121
SECTION 12.7 Rights of the Agents............................................................121
SECTION 12.8 Independent Investigation by Lenders............................................121
SECTION 12.9 Agreement of the Lenders........................................................121
SECTION 12.10 Notice of Transfer..............................................................121
SECTION 12.11 Relations Among Lenders.........................................................121
SECTION 12.12 Successor Agents................................................................122
SECTION 12.13 Tenant's Quiet Enjoyment........................................................122
SECTION 12.14 Lender Payments.................................................................123
13. MISCELLANEOUS.........................................................................................123
SECTION 13.1 Notices.........................................................................123
SECTION 13.2 Survival of Agreement, Representations and Warranties, etc......................124
SECTION 13.3 Successors and Assigns; Syndications; Loan Sales; Participations................125
SECTION 13.4 Expenses; Documentary Taxes.....................................................129
SECTION 13.5 Indemnity.......................................................................130
SECTION 13.6 CHOICE OF LAW...................................................................130
SECTION 13.7 WAIVER OF JURY TRIAL............................................................131
SECTION 13.8 WAIVER WITH RESPECT TO DAMAGES..................................................131
SECTION 13.9 No Waiver.......................................................................131
SECTION 13.10 Extension of Payment Date.......................................................132
SECTION 13.11 Amendments, etc.................................................................132
SECTION 13.12 Severability....................................................................133
SECTION 13.13 SERVICE OF PROCESS..............................................................134
SECTION 13.14 Headings........................................................................134
SECTION 13.15 Execution in Counterparts.......................................................134
SECTION 13.16 Subordination of Intercompany Indebtedness, Receivables and Advances............135
SECTION 13.17 Confidentiality.................................................................135
SECTION 13.18 Entire Agreement................................................................136
SECTION 13.19 Enforcement of Rights; No Obligation to Marshall Assets.........................136
SECTION 13.20 Reproduction of Documents.......................................................136
SECTION 13.21 Right of Set-Of.................................................................136
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