Exhibit 10.1
AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
THIS AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT is made on September
22, 2005, by and among INSIGHT HEALTH SERVICES CORP. (individually and, in its
capacity as the representative of the other Borrowers pursuant to SECTION 4.4,
"INSIGHT HEALTH"), a Delaware corporation, those subsidiaries of InSight Health
listed on the signature pages hereto (InSight Health and each of its
subsidiaries listed on the signature pages hereto being referred to collectively
as "BORROWERS," and individually as a "BORROWER"); the various financial
institutions listed on the signature pages hereof (together with their
respective successors and permitted assigns, the "Lenders"); and BANK OF
AMERICA, N.A., a national bank, in its capacity as collateral and administrative
agent for the Lenders pursuant to Section 13 (together with its successors in
such capacity "Administrative Agent"). Capitalized terms used in this Agreement
have the meanings assigned to them in SECTION 1.
RECITALS:
InSight Health, as the Borrower, Subsidiary Guarantors (as defined in the
below defined Existing Loan Agreement), Parent, the financial institutions party
thereto from time to time, Bank of America, N.A., as Administrative Agent,
Wachovia Bank, National Association, as Syndication Agent, and The CIT
Group/Business Credit, Inc., as Documentation Agent, entered into that certain
Credit Agreement dated as of October 17, 2001 (as at any time amended, modified,
supplemented or restated, the "Existing Credit Agreement").
InSight Health, as the Borrower, Parent, Subsidiary Guarantors, and Bank of
America, N.A., as Administrative Agent, also entered into that certain Security
Agreement dated as of October 17, 2001 (as at any time amended, modified,
supplemented or restated, the "Existing Security Agreement").
Borrowers have requested that the Existing Credit Agreement and the
Existing Security Agreement be amended and restated to make available an amended
and restated credit facility in accordance with the terms and conditions
contained herein.
Each Borrower has requested that Lenders make available a revolving credit
and letter of credit facility to Borrowers, which shall be used by Borrowers to
finance their mutual and collective enterprise of the provision of diagnostic
imaging services through an integrated network of fixed-site centers and mobile
facilities. In order to utilize the financial powers of each Borrower in the
most efficient and economical manner, and in order to facilitate the financing
of each Borrower's needs, Lenders will, at the request of any Borrower, make
loans to all Borrowers under the revolving credit facility on a combined basis
and in accordance with the provisions hereinafter set forth. Borrowers' business
is a mutual and collective enterprise and Borrowers believe that the
consolidation of all revolving credit loans under this Agreement will enhance
the aggregate borrowing powers of each Borrower and ease the administration of
their revolving credit loan relationship with Lenders, all to the mutual
advantage of Borrowers. Lenders' willingness to extend credit to Borrowers and
to administer each Borrower's collateral security therefor, on a combined basis
as more fully set forth in this Agreement, is done solely as an accommodation to
Borrowers and at Borrowers' request in furtherance of Borrowers' mutual and
collective enterprise.
Each Borrower has agreed to be jointly and severally liable for loans and
all outstanding other obligations under this Agreement and to guarantee the
obligations of each of the other Borrowers under this Agreement and each of the
other Loan Documents.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained and to induce the Administrative Agent and the
Lenders to amend and restate the Existing Credit Agreement and the Existing
Security Agreement and to extend credit to Borrowers hereunder, for Ten Dollars
($10.00) and other good and valuable consideration, the parties hereto,
intending to be bound hereby, agree as follows:
SECTION 1. DEFINITIONS; RULES OF CONSTRUCTION
1.1. DEFINITIONS.
As used in this Agreement, the following terms shall have the meanings
ascribed to them (terms used in the singular to have the same meaning when used
in the plural, and vice versa):
Account - shall have the meaning given to the term "account" in the
UCC and shall include any and all rights of a Borrower to payment for goods
sold or leased or for services rendered that are not evidenced by an
Instrument or Chattel Paper, whether or not they have been earned by
performance. For the avoidance of doubt, when used in reference to a
Borrower the term shall include each Health-Care-Insurance Receivable of
such Borrower.
Account Debtor - a Person who is or becomes obligated under or on
account of an Account, Chattel Paper or General Intangible.
Accounts Formula Amount - on any date of determination thereof, (i) if
there are no Revolver Loans outstanding on such date and the LC Obligations
that have not been Cash Collateralized do not exceed $2,000,000 on such
date, an amount equal to the sum of 85% of the net amount of Eligible
Retail Receivables on such date plus 85% of the net amount of Eligible
Wholesale Receivables on such date or (ii) if Revolver Loans are
outstanding on such date or the LC Obligations that have not been Cash
Collateralized exceed $2,000,000 on such date, an amount equal to the
lesser of (a) 85% of the net amount of Eligible Retail Receivables on such
date plus 85% of the net amount of Eligible Wholesale Receivables on such
date or (b) the Cash Collection Limit as of such date. As used herein, the
phrase "net amount of Eligible Wholesale Receivables" or "net amount of
Eligible Retail Receivables" shall mean the face amount of such Accounts on
any date less any and all returns, rebates, discounts (which may, at
Administrative Agent's option, be calculated on shortest terms), credits,
allowances or Taxes (including sales, excise or other taxes) at any time
issued, owing, claimed by Account Debtors, granted, outstanding or payable
in connection with, or any interest accrued on the amount of, such Accounts
at such date.
Acquisition Agreement - with respect to each Acquisition Transaction,
each stock purchase agreement or asset purchase agreement, as the context
may require, to be executed and delivered by and among a Borrower or an
Acquisition Subsidiary, as purchaser, and each owner, as seller, of the
Equity Interests or assets to be sold to such Borrower or Acquisition
Subsidiary, together with any and all permitted amendments, modifications
and supplements thereto, restatements thereof and substitutes therefor.
Acquisition Consideration - shall mean the consideration given and to
be given by a Borrower or any Acquisition Subsidiary for or in an
Acquisition Transaction (other than Equity
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Interests of Parent and contributions made by any Equity Investor to the
capital of Parent that are contributed by Parent to InSight Health),
including the fair market value of any Cash, Property, Equity Interests
(other than Equity Interests of Parent and contributions made by any Equity
Investor to the capital of Parent that are contributed by Parent to InSight
Health), and the amount of any Acquisition Funded Debt assumed or incurred
by such Borrower or Acquisition Subsidiary in connection with such
Acquisition Transaction.
Acquisition Documents - individually and collectively, as the context
may require, each Acquisition Agreement and any and all other agreements,
documents or instruments at any time executed and delivered by a Borrower
or an Acquisition Subsidiary, in connection with an Acquisition
Transaction.
Acquisition Funded Debt - with respect to any Acquisition Target, the
sum of (a) the aggregate principal amount of Debt for borrowed money which
would, in accordance with GAAP, be classified as long-term Debt, together
with the current maturities thereof and the face amount of all outstanding
letters of credit plus (b) all Debt outstanding under any revolving credit,
line of credit or renewals thereof, notwithstanding that any such Debt is
created within one year of the expiration of such agreement plus (c) all
Capitalized Lease Obligations, in each case that remain outstanding
following consummation of an Acquisition Transaction.
Acquisition Subsidiary - a Subsidiary formed by a Borrower after the
Restatement Effective Date to purchase all of the issued and outstanding
Equity Interests, or all or substantially all of the assets of an
Acquisition Target or a division or separate line of business of an
Acquisition Target, subject to the satisfaction of each of the following
conditions : (i) no Default or Event of Default exists at the time or would
result therefrom; (ii) Borrowers deliver to Administrative Agent any and
all documents, agreements, financial statements, projections and
instruments requested by Administrative Agent, in form and substance
reasonably satisfactory to Administrative Agent in all respects, in
connection with such formation, including (a) such documents and
instruments as may be necessary to grant or confirm to Administrative
Agent, for the benefit of Secured Parties, a first priority perfected Lien
(subject to Permitted Liens) on all of the assets of the Subsidiary,
including the Equity Interests in such Subsidiary, and (b) a Joinder
Agreement executed by such Subsidiary, together with other collateral
documents and opinions of counsel as may be reasonably requested by
Administrative Agent, each in form and substance reasonably satisfactory to
Administrative Agent; and (iii) Borrowers shall give Administrative Agent
at least 5 days prior written notice before forming such Subsidiary and
provide copies of all organizational documents of such Subsidiary to
Administrative Agent.
Acquisition Target - a Person whose Equity Interests or assets are to
be purchased pursuant to an Acquisition Transaction.
Acquisition Transaction - a transaction pursuant to an Acquisition
Agreement for the purchase of all of the issued and outstanding Equity
Interests, or all or substantially all of the assets, of an Acquisition
Target, or for the purchase of all or substantially all of the assets of a
division or separate line of business of an Acquisition Target.
Adjusted EBITDA - for any fiscal period of Borrowers and their
Subsidiaries, the sum for such period of (i) Adjusted Net Earnings, plus
(ii) any provision for taxes based on income, to the extent deducted in the
calculation of Adjusted Net Earnings, plus (iii) interest expense, to the
extent deducted in the calculation of Adjusted Net Earnings, plus (iv)
depreciation and amortization, to the extent deducted in the calculation of
Adjusted Net Earnings, plus (v) income from minority interests, plus (vi)
transaction costs and expenses relating to the effectiveness of
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this Agreement and the issuance and sale of the Senior Notes and, without
duplication of clause (iv) of this definition of Adjusted EBITDA,
unamortized loan costs with respect to the Senior Subordinated Notes and
the Existing Credit Agreement, plus (vii) management fees and expenses paid
to the Sponsors or any of their respective Affiliates in accordance with
SECTION 10.2.4, plus (viii) any extraordinary, unusual or non-recurring
expenses or losses not requiring the expenditure of cash in the current or
any future period, plus (ix) purchase accounting adjustments not requiring
the expenditure of cash in the current or any future period required or
permitted by GAAP in connection with any Permitted Acquisition
Adjusted LIBOR Rate - for any Interest Period, with respect to LIBOR
Loans, the rate of interest per annum determined pursuant to the following
formula:
Offshore Base Rate
Adjusted LIBOR Rate = ------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Offshore Base Rate" means the rate per annum appearing on
Telerate Page 3750 (or any successor page) as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m.
(London time) 2 Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any
reason such rate is not available, the Offshore Base Rate shall be,
for any Interest Period, the rate per annum appearing on Reuters
Screen LIBO Page as the London interbank offered rate for deposits in
Dollars at approximately 11:00 a.m. (London time) 2 Business Days
prior to the first day of such Interest Period for a term comparable
to such Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates. If for any reason none of the
foregoing rates is available, the Offshore Base Rate shall be, for any
Interest Period, the rate per annum determined by Administrative Agent
as the rate of interest at which Dollar deposits in the approximate
amount of the applicable LIBOR Loan would be offered by BofA's London
Branch to major banks in the offshore Dollar market at their request
at or about 11:00 a.m. (London time) 2 Business Days prior to the
first day of such Interest Period for a term comparable to such
Interest Period.
"Eurodollar Reserve Percentage" means for any day during any
Interest Period, the reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day
applicable to member banks under regulations issued from time to time
by the Board of Governors for determining the maximum reserve
requirement (including any emergency, supplemental or other marginal
reserve requirement) with respect to Eurocurrency funding (currently
referred to as "Eurocurrency liabilities"). The Offshore Rate for each
outstanding LIBOR Loan shall be adjusted automatically as of the
effective date of any change in the Eurodollar Reserve Percentage.
Adjusted Net Earnings - with respect to any fiscal period, the net
earnings (or loss) for such fiscal period of Borrowers and their
Subsidiaries, all as reflected on the financial statement of Borrowers and
their Subsidiaries supplied to Administrative Agent and Lenders pursuant to
SECTION 10.1.3, but excluding: (i) any gain or loss arising from the sale
of capital assets; (ii) any gain arising from any write-up of assets; (iii)
net earnings of any entity (other than a Subsidiary of a Borrower) in which
a Borrower has an ownership interest unless such net earnings have actually
been received by a Borrower in the form of cash Distributions; (iv) any
portion of the net earnings of any Subsidiary which for any reason is
unavailable for payment of Distributions to a
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Borrower; (v) the earnings of any Person to which any assets of a Borrower
shall have been sold, transferred or disposed of, or into which a Borrower
shall have merged, or been a party to any consolidation or other form of
reorganization, prior to the date of such transaction; and (vi) any gain or
loss arising from extraordinary items, all as determined in accordance with
GAAP on a Consolidated basis.
Administrative Agent Indemnitees - Administrative Agent, its
Affiliates and all of their present and future officers, directors,
employees, agents and attorneys.
Administrative Agent Professionals - attorneys, accountants,
appraisers, business valuation experts, environmental engineers or
consultants, turnaround consultants and other professionals or experts
retained by Administrative Agent.
Affiliate - a Person (i) who directly or indirectly through one or
more intermediaries controls, or is controlled by, or is under common
control with, another Person; (ii) who beneficially owns or holds 10% or
more of any class of the Equity Interests of another Person; or (iii) 10%
or more of the Equity Interests with power to vote of which is beneficially
owned or held by another Person or a Subsidiary of another Person. For
purposes hereof, "control" means the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies
of a Person, whether through the ownership of any Equity Interest, by
contract or otherwise.
Agreement - this Loan and Security Agreement and all Exhibits and
Schedules thereto.
Anti-Kickback Statutes - Section 1128B(b) of the Social Security Act
and any other similar law, rule or regulation adopted by any Governmental
Authority.
Anti-Terrorism Laws - any laws relating to terrorism or money
laundering, including Executive Order No. 13224 and the USA Patriot Act.
Applicable Law - all laws, rules and regulations applicable to the
Person, conduct, transaction, covenant, Loan Document or Material Contract
in question, including all applicable common law and equitable principles;
all provisions of applicable state, federal and foreign constitutions,
statutes, rules, regulations and orders of Governmental Authorities; and
all orders, judgments and decrees of all courts and arbitrators.
Applicable Margin - a percentage equal to 0% with respect to Revolver
Loans that are Base Rate Loans, 2.50% with respect to Revolver Loans that
are LIBOR Loans and .50% with respect to the Unused Line Fee.
Approved Credit Enhancement - in Administrative Agent's reasonable
discretion and at its option, either (i) an irrevocable letter of credit
that is in form and substance reasonably acceptable to Administrative
Agent, issued or confirmed by a bank reasonably acceptable to
Administrative Agent, and payable in Dollars at a place of payment within
the United States that is reasonably acceptable to Administrative Agent,
which letter of credit is assigned to Administrative Agent for the benefit
of Secured Parties (with such assignment acknowledged by the issuing or
confirming bank) or, if so requested by Administrative Agent, duly
transferred to Administrative Agent for the benefit of Secured Parties
(together with sufficient documentation to permit direct draws under any
such letter of credit by Administrative Agent for the benefit of Secured
Parties) or (ii) credit insurance that is issued by a credit insurance
company reasonably acceptable to Administrative Agent and is in form and
substance reasonably acceptable to
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Administrative Agent (which credit insurance shall be payable to
Administrative Agent for the benefit of Secured Parties in Dollars).
Asset Disposition - a sale, lease, license, consignment or other
transfer or disposition of Property of an Obligor, including a termination
of rights of any Obligor under any lease, license agreement or other
contract or a disposition of Property in connection with a sale-leaseback
transaction or synthetic lease.
Assignment and Acceptance - an assignment and acceptance entered into
by a Lender and an Eligible Assignee and accepted by Administrative Agent,
in the form of EXHIBIT G.
Availability - on any date, the amount that Borrowers are entitled to
borrow as Revolver Loans on such date, such amount being the difference
derived when the sum of the principal amount of Revolver Loans then
outstanding (including any outstanding Swingline Loans) is subtracted from
the Borrowing Base on such date. If the amount of Revolver Loans
outstanding on any date is equal to or greater than the Borrowing Base,
then Availability on such date shall be zero or a negative number, as
applicable.
Availability Reserve - on any date of determination thereof, an amount
equal to the sum of the following (without duplication): (i) any amounts
which any Obligor is obligated to pay to Administrative Agent, Lenders or
other Persons pursuant to the provisions of any of the Loan Documents that
Administrative Agent or any Lender elects to pay for the account of such
Obligor in accordance with authority contained in any of the Loan
Documents; (ii) the LC Reserve; (iii) the aggregate amount of reserves
established by Administrative Agent from time to time in its discretion in
respect of Banking Relationship Debt; (iv) the aggregate amount of all
liabilities and obligations that are secured by Liens upon any of the
Collateral that are senior in priority to Administrative Agent's Liens if
such Liens are not Permitted Liens (provided that the imposition of a
reserve hereunder on account of such Liens shall not be deemed a waiver of
the Event of Default that arises from the existence of such Liens) or are
Permitted Liens under SECTION 10.2.5(II); (v) the Professional Fees
Reserve; and (vi) such additional reserves, in such amounts as
Administrative Agent in its reasonable discretion, exercised in a manner
consistent with its customary practices or otherwise in good faith, may
elect to impose from time to time. The burden of establishing lack of good
faith shall be on Borrowers.
Average Liquidity - for any period, an amount equal to the sum of the
amount of Liquidity on each day during such period divided by the number of
days in such period.
Average Revolver Loan Balance - for any period, the amount obtained by
adding the unpaid balance of Revolver Loans and LC Obligations at the end
of each day for the period in question and by dividing such sum by the
number of days in such period.
Bank Products - any one or more of the following types of products,
services or facilities extended to any Obligor by BofA or any Affiliate of
BofA: (i) commercial credit cards; (ii) merchant card services; (iii)
products or services under Cash Management Agreements; (iv) products under
Hedging Agreements; (v) interstate depository network services; and (vi)
such other banking products or services provided by BofA or any Affiliate
of BofA as may be requested by any Obligor, other than Letters of Credit.
Banking Relationship Debt - Debt or other liabilities or obligations
of an Obligor to BofA (or any Affiliate of BofA) arising out of or relating
to Bank Products.
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Bankruptcy Code - title 11 of the United States Code.
Base Rate - the rate of interest announced or quoted by BofA from time
to time as its prime rate. The prime rate announced by BofA is a reference
rate and does not necessarily represent the lowest or best rate charged by
BofA. BofA from time to time makes loans or other extensions of credit at,
above or below its announced prime rate. If the prime rate is discontinued
by BofA as a standard, a comparable reference rate designated by BofA as a
substitute therefor shall be the Base Rate.
Base Rate Loan - a Loan, or portion thereof, during any period in
which it bears interest at a rate based upon the Base Rate.
Black Diamond - Black Diamond Management and any and all of its
Affiliates.
Blocked Person - as defined in SECTION 9.1.27(II).
Board of Governors - the Board of Governors of the Federal Reserve
System.
BofA - Bank of America, N.A. a national bank, and its successors and
assigns.
BofA Indemnitees - BofA, its Affiliates and all of their present and
future officers, directors, employees, agents and attorneys.
Borrower Agent - as defined in SECTION 4.4.
Borrowing - a borrowing consisting of Loans of one Type made on the
same day by Lenders (or by BofA in the case of a Borrowing funded by
Swingline Loans) or a conversion of a Loan or Loans of one Type from
Lenders on the same day.
Borrowing Base - on any date of determination thereof, an amount equal
to the lesser of: (a) the aggregate amount of the Revolver Commitments on
such date minus the LC Reserve on such date, or (b) an amount equal to (i)
the Accounts Formula Amount on such date minus (ii) the Availability
Reserve on such date.
Borrowing Base Certificate - a certificate, in the form set forth on
EXHIBIT K, by which Borrowers shall certify to Administrative Agent and
Lenders the amount of the Borrowing Base as of the date of the certificate
and the calculation of such amount.
Business Day - any day excluding Saturday, Sunday and any other day
that is a legal holiday under the laws of the State of New York or is a day
on which banking institutions located in such state are closed; provided,
however, that when used with reference to a LIBOR Loan (including the
making, continuing, prepaying or repaying of any LIBOR 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 Adequacy Regulation - any guideline, request or directive of
any central bank or other Governmental Authority, or any other law, rule or
regulation, whether or not having the force of law, in each case regarding
capital adequacy of any bank or of any corporation controlling a bank.
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Capital Expenditures - expenditures made or liabilities incurred by a
Borrower for the acquisition of any fixed assets or improvements,
replacements, substitutions or additions thereto, including the total
principal portion of Capitalized Lease Obligations.
Capitalized Lease Obligation - any Debt represented by obligations
under a lease that is required to be capitalized for financial reporting
purposes in accordance with GAAP.
Cash - money, currency or a credit balance in a Deposit Account.
Cash Collateral - cash, and any interest or other income earned
thereon, that is deposited with Administrative Agent in accordance with
this Agreement for the Pro Rata benefit of Lenders to Cash Collateralize
any LC Obligations or other Obligations.
Cash Collateral Account - a demand deposit, money market or other
account established by Administrative Agent at such financial institution
as Administrative Agent may select in its discretion, which account shall
be in Administrative Agent's name and subject to Administrative Agent's
Liens for the benefit of Secured Parties.
Cash Collateralize - with respect to LC Obligations arising from
Letters of Credit outstanding on any date or Obligations arising under
Hedging Agreements on such date, the deposit with Administrative Agent of
immediately available funds into the Cash Collateral Account in an amount
equal to 104% of the aggregate Undrawn Amount of such Letters of Credit and
other LC Obligations, plus (ii) all Obligations existing under such Hedging
Agreements.
Cash Collection Limit - on any date of determination thereof, an
amount equal to the Monthly Cash Collections for the most recent month
ending prior to such date divided by the actual number of days in such
month multiplied by 35.
Cash Equivalents - (i) United States dollars (including such dollars
as are held in overnight deposits and demand deposits with U.S. banks);
(ii) marketable direct obligations issued or unconditionally guaranteed by
the United States government and backed by the full faith and credit of the
United States government having maturities of not more than 12 months from
the date of acquisition; (iii) marketable direct obligations issued by any
State of the United States of America or any political subdivision of any
such State or any public instrumentality thereof maturing within 1 year
from the date of acquisition thereof and, at the time of acquisition,
having a rating of at least A-2 from S&P or at least P-2 of Moody's; (iv)
certificates of deposit demand deposits, Eurodollar time deposits, time
deposit accounts, term deposit accounts and time deposits having maturities
of not more than 12 months from the date of acquisition, bankers'
acceptances having maturities of not more than 12 months from the date of
acquisition and overnight bank deposits, in each case issued by any
commercial bank organized under the laws of the United States, any state
thereof or the District of Columbia, which at the time of acquisition have
capital and assets of not less than $100 million; (v) repurchase
obligations with a term of not more than 90 days for underlying securities
of the types described in clauses (i), (ii), (iii) and (iv) entered into
with any financial institution meeting the qualifications specified in
clause (iv) above; (vi) commercial paper having at the time of investment
therein or a contractual commitment to invest therein a rating of A-2 (or
better) by S&P or P-2 (or better) by Moody's, and having a maturity within
12 months after the date of acquisition thereof; and (vii) shares of any
money market fund that (a) has substantially all of its assets invested
continuously in the types of investments referred to in clauses (i) - (vi),
(b) has net assets not less than $500,000,000 and (c) has at least the
second highest rating obtainable from either Moody's or S&P.
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Cash Management Agreements - any agreement entered into from time to
time between any Borrower or any of its Subsidiaries, on the one hand, and
BofA or any of its Affiliates, on the other, in connection with cash
management services for operating, collections, payroll and trust accounts
of such Borrower or its Subsidiaries including automatic clearinghouse
services, controlled disbursement services, electronic funds transfer
services, information reporting services, lockbox services, stop payment
services and wire transfer services.
Cash Taxes Paid - for any period, the provision by Borrowers and their
Subsidiaries for income taxes as shown on the profit and loss statement of
Borrowers for such period minus any increase (or plus any decrease) in the
provision for deferred taxes of Borrowers and their Subsidiaries,
determined on a Consolidated basis in accordance with GAAP.
CERCLA - the Comprehensive Environmental Response Compensation and
Liability Act (42 U.S.C. Section 9601 et seq.)
Change of Control - the occurrence of any of the following: (i)
Sponsors and Sponsor Related Parties cease to own and control, beneficially
and of record, 51% of the Equity Interests in Parent; (ii) Parent ceases to
own and control, beneficially and of record, all of the Equity Interests in
InSight Health; (iii) except in the case of any Permitted Asset
Disposition, InSight Health ceases to own and control, beneficially and of
record, all of the Equity Interests in each of the other Borrowers; (iv)
all or substantially all of InSight Health's assets are sold as an entirety
to any Person or related group of Persons; (v) InSight Health is merged
with or into another Person, other than a Borrower; (vi) any Person or
related group of Persons acquires by way of a purchase, merger,
consolidation or other business combination a majority of the Equity
Interests entitled to vote in the election of directors of InSight Health;
or (vii) a change in the majority of the board of directors of InSight
Health unless approved by the then majority of the board of directors of
InSight Health or by Sponsors and Sponsor Related Parties.
Chattel Paper - shall have the meaning given to the term "chattel
paper" in the UCC.
Claims - all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, awards, costs (including remedial response
costs), charges, expenses and disbursements of any kind or nature
(including reasonable attorneys', accountants', consultants', or
paralegals' fees and expenses) which may at any time (including at any time
following Full Payment of the Obligations or termination of the
Commitments, resignation or replacement of Administrative Agent or
replacement of any Lender), be imposed on, incurred by, or asserted against
any Indemnitee in any way relating to or arising out of (i) the
administration or enforcement of or performance under any of the Loan
Documents or consummation of any of the transactions described herein, (ii)
any action taken or omitted to be taken by any Indemnitee under or in
connection with any of the Loan Documents or Applicable Law, (iii) the
existence, perfection or realization upon Administrative Agent's Liens upon
any Collateral, (iv) the exercise by Administrative Agent or any Lender of
any of its rights or remedies under any of the Loan Documents or Applicable
Law, or (v) the failure of any Obligor to observe, perform or discharge any
of such Obligor's covenants or duties under any of the Loan Documents or
the inaccuracy or incompleteness of any representation or warranty of any
Borrower in any of the Loan Documents, in each case including any
reasonable out-of-pocket costs or expenses incurred by any Indemnitee in
connection with any investigation, litigation, arbitration or other
judicial or non-judicial proceeding (including any Insolvency Proceeding or
appellate proceedings) whether or not such Indemnitee is a party thereto.
This definition of Claims is subject to the provisions of SECTION 15.3.
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CMS - Centers for Medicare and Medicaid Services and any successor
thereto.
Collateral - all of the Property and interests in Property described
in SECTION 7; all Property described in any of the Security Documents as
security for the payment or performance of any of the Obligations; and all
other Property and interests in Property that now or hereafter secure the
payment and performance of any of the Obligations.
Collection Accounts - collectively, the Retail Collection Accounts and
the Wholesale Collection Accounts.
Commercial Payor - any Third Party Payor which is (i) a commercial
medical insurance company that is organized under the laws of any
jurisdiction of the United States and has its principal office in the
United States, (ii) a Blue Cross/Blue Shield Plan or (iii) a health
maintenance organization or other managed care organization, preferred
provider organization or other institutional obligor that is organized
under the laws of any jurisdiction of the United States and has its
principal office in the United States.
Commitment - at any date for any Lender, the amount of such Lender's
Revolver Commitment on such date, and "Commitments" means the aggregate
amount of all Revolver Commitments on such date.
Commitment Termination Date - the date that is the soonest to occur of
(i) the last day of the Term; (ii) the date on which either Borrowers or
Administrative Agent terminates the Revolver Commitments pursuant to
SECTION 6.2; or (iii) the date on which the Revolver Commitments are
automatically terminated pursuant to SECTION 12.2.
Compliance Certificate - a Compliance Certificate to be provided by
Borrowers to Administrative Agent in accordance with, and in the form
annexed as EXHIBIT E to, this Agreement and the supporting schedules to be
annexed thereto.
Concentration Account - shall have the meaning ascribed to it in
SECTION 8.2.5(I) hereof.
Consolidated - the consolidation in accordance with GAAP of the
accounts or other items as to which such term applies.
Contingent Obligation - with respect to any Person, any obligation of
such Person arising from any guaranty, indemnity or other assurance of
payment or performance of any Debt, lease, dividend or other obligation
("primary obligations") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including (i) the direct or
indirect guaranty, endorsement (other than for collection or deposit in the
Ordinary Course of Business), co-making, discounting with recourse or sale
with recourse by such Person of the obligation of a primary obligor, (ii)
the obligation to make take-or-pay or similar payments, if required,
regardless of nonperformance by any other party or parties to an agreement,
(iii) 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 (1) for the
purchase or payment of any such primary obligations or (2) to maintain
working capital or equity capital of the primary obligor or otherwise to
maintain the net worth or solvency of the primary obligor, (C) to purchase
Property or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make
payment of such primary obligation or (D) otherwise to assure or hold
harmless the holder of such primary obligation against loss in respect
thereof. The amount of any Contingent Obligation shall be
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deemed to be an amount equal to the stated or determinable amount of the
primary obligation with respect to which such Contingent Obligation is made
(or, if less, the maximum amount of such primary obligation for which such
Person may be liable pursuant to the terms of the instrument evidencing
such Contingent Obligation) or, if not stated or determinable, the maximum
reasonably anticipated liability with respect thereto (assuming such Person
is required to perform thereunder), as determined by such Person in good
faith.
Contractual Adjustment Allowance - on any date, an amount determined
by Borrowers, but acceptable to Administrative Agent in its Credit
Judgment, intended to represent the amount of Retail Receivables as of such
date that Borrowers do not expect to be paid in Cash, such reserve to be
computed in accordance with Borrowers' historical practices.
Control Agreements - the control agreements to be executed by certain
depository and other institutions of a Borrower in favor of Administrative
Agent with respect to certain Deposit Accounts and other accounts of
Borrowers, including the Concentration Account, the Investment Accounts and
each Wholesale Collection Account, for the benefit of Secured Parties, as
security for the Obligations.
Controlled Disbursement Account - a demand deposit account maintained
by Borrowers at BofA or any of its Affiliates and to which proceeds of
Loans may be transferred from time to time.
Credit Judgment - Administrative Agent's judgment exercised in a
manner consistent with its customary practices or otherwise in good faith,
based upon its consideration of any factor that it believes (i) will or
could reasonably be expected to affect adversely the quantity, quality, mix
or value of any Collateral, the enforceability or priority of
Administrative Agent's Liens or the amount that Administrative Agent and
Lenders would be likely to receive (after taking into account delays in the
payment and estimated costs of enforcement) in the collection of the
Accounts or liquidation of any of the Collateral; (ii) suggests that any
collateral report or financial information delivered to Administrative
Agent by any Person on behalf of any Obligor is incomplete, inaccurate or
misleading in any material respect; (iii) materially increases the
likelihood of any Insolvency Proceeding involving any Obligor; or (iv)
creates or reasonably could be expected to create or result in a Default or
Event of Default. In exercising such judgment, Administrative Agent may
consider such factors already included in or tested by the definition of
Eligible Accounts, as well as any of the following: (a) the financial and
business climate of Borrowers' industry; (b) changes in collection history
and dilution with respect to the Accounts; (c) material changes in any
concentration risks with respect to Accounts; and (d) any of the factors
that could materially increase the credit risk of lending to any of
Borrowers on the security of the Collateral. The burden of establishing
lack of good faith shall be on Borrowers.
Current Asset - on any date, any asset that would be properly
classified as a current asset in accordance with GAAP on such date.
CWA - the Clean Water Act (33 U.S.C. Sections 1251 et seq.).
Debt - as applied to a Person means, without duplication: (i) all
obligations of such Person for Money Borrowed and all obligations of such
Person evidenced by bonds, notes or similar instruments; (ii) all
obligations of such Person for the deferred purchase price of Property or
services (excluding accounts payable and other accrued liabilities incurred
in the Ordinary Course of Business; (iii) all Contingent Obligations of
such Person in respect of items that would constitute Debt under clause (i)
or (ii) of this definition; (iii) all reimbursement obligations in
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connection with letters of credit or letter of credit guaranties issued for
the account of such Person; and (iv) in the case of a Borrower (without
duplication), the Obligations. The Debt of a Person shall include any
recourse Debt of any partnership or joint venture in which such Person is a
general partner or joint venturer.
Default - an event or condition the occurrence of which would, with
the lapse of time or the giving of notice, or both, become an Event of
Default.
Default Rate - on any date, a rate per annum that is equal to (i) in
the case of each Revolver Loan outstanding on such date, 2% in excess of
the rate otherwise applicable to such Loans on such date, and (ii) in the
case of any of the other Obligations outstanding on such date, 2% plus the
highest Applicable Margin for Base Rate Loans.
Deposit Account - shall have the meaning given to the term "deposit
account" in the UCC.
Deposit Accounts Collateral - all Deposit Accounts of Borrowers in
existence on the Restatement Effective Date and identified on SCHEDULE 8.3
and each Deposit Account established by a Borrower after the Restatement
Effective Date for the purpose of depositing collections on Accounts or
other proceeds of Collateral therein.
Distribution - in respect of any entity, (i) any payment of dividends
or other distributions on Equity Interests of the entity (except
distributions in Equity Interests) and (ii) any purchase, redemption or
other acquisition or retirement for value of Equity Interests of the entity
or any Subsidiary of the entity unless made contemporaneously from the net
proceeds of the sale of Equity Interests, including Upstream Payments of
the type described in clause (c) of the definition of such term.
Document - shall have the meaning given to the term "document" in the
UCC.
Dollars and the sign $ - lawful money of the United States of America.
Dominion Account - a Deposit Account established by Borrowers at BofA
or at another bank selected by Borrowers, but acceptable to Administrative
Agent in its reasonable discretion, and over which, upon written notice
from Administrative Agent of the existence of a Restrictive Trigger Event,
Administrative Agent shall have exclusive access and dominion for
withdrawal purposes.
Electronic Chattel Paper - shall have the meaning given to the term
"electronic chattel paper" in the UCC.
Eligible Account - an Eligible Retail Receivable or Eligible Wholesale
Receivable, or both of them, as the context requires.
Eligible Assignee - a Person that is a Lender, a U.S. based Affiliate
of a Lender or an Approved Fund (as defined below); a commercial bank,
finance company, or other financial institution, in each case that is
organized under the laws of the United States or any state, has total
assets in excess of $10 billion, extends asset-based lending facilities of
the type contemplated herein in the Ordinary Course of Business and whose
becoming an assignee would not constitute a prohibited transaction under
Section 4975 of ERISA or any other Applicable Law, is acceptable to
Administrative Agent and, unless an Event of Default exists, Borrowers
(such approval by
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Borrowers, when required, not to be unreasonably withheld or delayed and to
be deemed given by Borrowers if no objection is received by the assigning
Lender and Administrative Agent from Borrowers within 7 Business Days after
notice of such proposed assignment has been provided by the assigning
Lender as set forth in SECTION 14.3 ); and, at any time that an Event of
Default exists, any other Person acceptable to Administrative Agent in its
discretion. In no event and under no circumstances shall Black Diamond be
an Eligible Assignee. The term "Approved Fund" means any Person (other than
a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the Ordinary
Course of Business of such Person and that is administered or managed by
(i) a Lender, (ii) an Affiliate of a Lender or (iii) an entity or an
Affiliate of an entity that administers or manages a Lender.
Eligible Cash - Cash or Cash Equivalents on deposit in the
Concentration Account, the Investment Accounts or any other Deposit Account
that is at all times subject to a Lien in favor of Administrative Agent,
and, at all times after October 28, 2005, with respect to which
Administrative Agent has "control" under (and as defined in) the UCC.
Eligible Retail Receivable - a Retail Receivable which arises in the
Ordinary Course of Business of a Borrower from the rendition or performance
of services, is payable in Dollars, is subject to Administrative Agent's
duly perfected Lien and is deemed by Administrative Agent, in its Credit
Judgment, to be an Eligible Retail Receivable. Without limiting the
generality of the foregoing, no Retail Receivable shall be an Eligible
Retail Receivable if: (i) the Third Party Payor is an Affiliate of a
Borrower, a Person controlled by an Affiliate of a Borrower or a Blocked
Person; (ii) the Retail Receivable is unbilled; (iii) it is outstanding
more than 120 days after the billing date, but only to the extent of 50% of
such Retail Receivable; (iv) the total unpaid Retail Receivables of the
Third Party Payor exceed 25% of the aggregate amount of all Accounts, to
the extent of such excess; (v) any covenant, representation or warranty
contained in the Agreement with respect to such Retail Receivable has been
breached in any material respect; (vi) the Third Party Payor is also such
Borrower's creditor or supplier, or the Third Party Payor has disputed
liability with respect to such Retail Receivable, or the Third Party Payor
has made any claim with respect to any other Retail Receivable due from
such Third Party Payor to such Borrower, or the Retail Receivable otherwise
is or may reasonably be expected to become subject to any right of setoff
(to the extent not waived in writing by such Third Party Payor),
counterclaim (to the extent not waived in writing by such Third Party
Payor), recoupment (to the extent not waived in writing by such Third Party
Payor), reserve or chargeback, provided that the Retail Receivables of such
Third Party Payor shall be ineligible only to the extent of such offset,
counterclaim, recoupment, disputed amount, reserve or chargeback; (vii) an
Insolvency Proceeding has been commenced by or against the Third Party
Payor or the Third Party Payor has failed, suspended business or ceased to
be Solvent; (viii) the Third Party Payor is located in a state in which
such Borrower 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 Borrower has qualified as a foreign
entity authorized to transact business in such state or has filed all
required reports; (ix) the Retail Receivable is subject to a Lien other
than a Permitted Lien; (x) the Retail Receivable is evidenced by Chattel
Paper or an Instrument of any kind, or has been reduced to judgment; (xi)
the Retail Receivable represents a progress billing or a retainage; (xii)
such Borrower has made any agreement with the Third Party Payor for any
deduction therefrom, except for discounts, adjustments or allowances which
are made in the Ordinary Course of Business and which discounts or
allowances are reflected in the calculation of the net amount of such
Retail Receivable; (xiii) the Retail Receivable represents, in whole or in
part, a billing for interest, fees or late charges; (xiv) the total
Eligible Retail Receivables due from Account Debtors other than Third Party
Payors exceeds $588,000, to the extent of such excess; (xv) it is not
evidenced by an
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invoice, statement or other electronic or documentary evidence satisfactory
to Administrative Agent; (xvi) to the extent it constitutes a credit
balance that is more than 120 days old; (xvii) it arises under or in
connection with an agreement in respect of which Borrowers have posted a
performance, surety or similar bond; (xviii) it has been turned over or
submitted to a third party for collection; or (xix) the Account Debtor on
such Retail Receivable has been characterized by Borrowers as falling into
an "unknown financial class." In addition to the foregoing, on any date the
balance of Eligible Retail Receivables on such date shall be reduced by the
aggregate of the Contractual Adjustment Allowance on such date and the
Professional Fees Allowance on such date.
Eligible Wholesale Receivable - a Wholesale Receivable that arises in
the Ordinary Course of Business of a Borrower from the rendition of
services, is payable in Dollars, is subject to Administrative Agent's duly
perfected Lien, and is deemed by Administrative Agent, in its Credit
Judgment, to be an Eligible Wholesale Receivable. Without limiting the
generality of the foregoing, no Account shall be an Eligible Wholesale
Receivable if: (i) it arises out of a sale made by a Borrower to an
Affiliate of a Borrower, a Person controlled by an Affiliate of a Borrower
or a Blocked Person; (ii) it is unpaid more than 90 days after the original
invoice date; (iii) 50% or more of the Accounts from the Account Debtor are
not deemed Eligible Accounts hereunder; (iv) the total unpaid Accounts of
the Account Debtor exceed 25% of the aggregate amount of all Accounts or
exceed a credit limit established by Administrative Agent, in its Credit
Judgment, for such Account Debtor, in each case to the extent of such
excess; (v) any covenant, representation or warranty contained in this
Agreement with respect to such Account has been breached in any material
respect; (vi) the Account Debtor is also such Borrower's creditor or
supplier, or has disputed liability with respect to such Account or has
made any claim with respect to any other Account due from such Account
Debtor to such Borrower, or the Account otherwise is or may reasonably be
expected to become subject to any right of setoff (to the extent not waived
in writing by such Account Debtor), counterclaim (to the extent not waived
in writing by such Account Debtor), recoupment (to the extent not waived in
writing by such Account Debtor), reserve, defense or chargeback, provided
that the Accounts of such Account Debtor shall be ineligible only to the
extent of such dispute or right of offset, counterclaim, recoupment,
reserve, defense or chargeback; (vii) an Insolvency Proceeding has been
commenced by or against the Account Debtor or the Account Debtor has
failed, suspended or ceased doing business; (viii) the Account Debtor is
not Solvent; (ix) it arises from a sale to an Account Debtor organized
under the laws of any jurisdiction outside of the United States or that has
its principal office, assets or place of business outside the United States
except to the extent that the sale is supported or secured by an Approved
Credit Enhancement; (x) the Account Debtor is located in a jurisdiction in
which such Borrower is deemed to be doing business under the laws of such
jurisdiction and which denies creditors access to its courts in the absence
of qualification to transact business in such jurisdiction or of the filing
of any reports with such jurisdiction, unless such Borrower has qualified
as a foreign entity authorized to transact business in such jurisdiction or
has filed all required reports; (xi) the Account is subject to a Lien other
than a Permitted Lien; (xii) the Account is evidenced by Chattel Paper or
an Instrument of any kind, or has been reduced to judgment; (xiii) the
Account represents a progress billing or a retainage; (xiv) such Borrower
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 and which discounts or allowances are reflected in the calculation
of the face value of each invoice related to such Account; (xv) the Account
represents, in whole or in part, a billing for interest, fees or late
charges; (xvi) the Account Debtor has made a partial payment with respect
to such Account; (xvii) to the extent it constitutes a credit balance that
is more than 90 days old; or (xviii) it arises under or in connection with
an agreement in respect of which Borrowers have posted a performance,
surety or similar bond.
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Enforcement Action - action taken or to be taken by Administrative
Agent, during any period that an Event of Default exists, to enforce
collection of the Obligations or to realize upon the Collateral (whether by
judicial action, under power of sale, by self-help repossession, by
notification to Account Debtors, or by exercise of rights of setoff or
recoupment).
Environmental Laws - all federal, state, local and foreign laws,
rules, regulations, codes, ordinances, orders and consent decrees (together
with all programs, permits and guidance documents promulgated by regulatory
agencies, to the extent having the force of law), now or hereafter in
effect, that relate to public health (but excluding occupational safety and
health, to the extent regulated by OSHA) or the protection or pollution of
the environment, whether new or hereafter in effect, including CERCLA, RCRA
and CWA.
Environmental Release - a release as defined in CERCLA or under any
other applicable Environmental Laws.
Equity Interest - the interest of (i) a shareholder in a corporation,
(ii) a partner (whether general or limited) in a partnership (whether
general, limited or limited liability), (iii) a member in a limited
liability company, or (iv) any other Person having any other form of equity
security or ownership interest, together, in each case, with any and all
warrants, rights or options to purchase or other arrangements or rights to
acquire any of the foregoing (but excluding any debt security that is
exchangeable for or convertible into such Equity Interests).
Equity Investors - collectively, Sponsors and their respective
Affiliates, and officers, employees and directors of Parent or any of its
Subsidiaries.
ERISA - the Employee Retirement Income Security Act of 1974.
Event of Default - as defined in SECTION 12.
Excluded Taxes - any (A) income, branch profits or franchise taxes
imposed on (or measured by) net income or gross receipts (other than any
such taxes imposed solely as a result of Borrower's activities in a
jurisdiction) (B) any tax that is imposed on amounts payable to the Lender
at the time the Lender becomes a party to this Agreement (or designates a
new lending office) and (C) any taxes attributable to Lender's failure to
comply with SECTION 5.9.3 of this Agreement.
Executive Order No. 13224 - Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001.
Existing Credit Agreement - as defined in the Recitals hereto.
Extraordinary Expenses - all reasonable out-of-pocket costs, expenses,
fees (including fees incurred to Administrative Agent Professionals) or
advances that Administrative Agent or any Lender may suffer or incur during
any period that an Event of Default exists, or during the pendency of an
Insolvency Proceeding of an Obligor, on account of or in connection with
(i) the audit, inspection, repossession, storage, repair, appraisal,
insuring, completion of the manufacture of, preparing for sale, advertising
for sale, selling, collecting or otherwise preserving or realizing upon any
Collateral; (ii) any action, suit, litigation, arbitration, contest or
other judicial or non-judicial proceeding (whether instituted by or against
Administrative Agent, any Lender, any Obligor, any representative of
creditors of any Obligor or any other Person) in any way arising out of or
relating to any of the Collateral (or the validity, perfection, priority or
avoidability of
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Administrative Agent's Liens with respect to any of the Collateral), any of
the Loan Documents or the validity, allowance or amount of any of the
Obligations, including any lender liability or other Claims asserted
against Administrative Agent or any Lender; (iii) the exercise, protection
or enforcement of any rights or remedies of Administrative Agent in, or the
monitoring of, any Insolvency Proceeding; (iv) the settlement or
satisfaction of any Liens upon any Collateral (whether or not such Liens
are Permitted Liens); (v) the collection or enforcement of any of the
Obligations, whether by Enforcement Action or otherwise; (vi) the
negotiation, documentation, and closing of any amendment, waiver,
restructuring or forbearance agreement with respect to the Loan Documents
or Obligations; (vi) amounts advanced by Administrative Agent pursuant to
SECTIONS 8.1.3 OR 15.10; or (viii) the enforcement of any of the provisions
of any of the Loan Documents. Such costs, expenses and advances may include
transfer fees, taxes, storage fees, insurance costs, permit fees, utility
reservation and standby fees, legal fees, appraisal fees, brokers' fees and
commissions, auctioneers' fees and commissions, accountants' fees,
environmental study fees, wages and salaries paid to employees of any
Borrower or independent contractors in liquidating any Collateral, travel
expenses, all other fees and expenses payable or reimbursable by Borrowers
or any other Obligor under any of the Loan Documents, and all other fees
and expenses associated with the enforcement of rights or remedies under
any of the Loan Documents, but excluding compensation paid to employees
(including inside legal counsel who are employees) of Administrative Agent
or any Lender.
Fee Letter - the fee letter agreement between Administrative Agent and
Borrower Agent.
FEIN - with respect to any Person, the Federal Employer Identification
Number of such Person.
Financial Covenant Trigger Amount - on any date of determination,
shall mean an amount equal to $15,000,000.
Fiscal Quarter - each quarter of Borrowers and their Subsidiaries for
accounting and tax purposes, ending on September 30, December 31, March 31
and June 30 of each year.
Fiscal Year - the fiscal year of Borrowers and their Subsidiaries for
accounting and tax purposes, which ends on June 30 of each year and when
preceded by the designation of a calendar year (e.g., 2005 Fiscal Year)
means the fiscal year of Borrowers and their Subsidiaries ended on June 30
of such designated calendar year.
Fixed Charge Coverage Ratio - for any period, the ratio of (a)
Adjusted EBITDA for such period minus Capital Expenditures (excluding
Capital Expenditures financed with Funded Debt other than Revolver Loans)
for such period minus Distributions for such period (other than
Distributions to a Borrower), net of any contributions of equity capital
paid in Cash to a Borrower from (1) repayments of loans made by a Borrower
to an officer, director or employee of a Borrower or any other Obligor
pursuant to clause (xii)(a) of the definition of Restricted Investment from
whom Parent's Equity Interests are repurchased and (2) proceeds from
resales of Parent's Equity Interests so repurchased, minus Cash Taxes Paid
for such period minus the amount of investments permitted pursuant to
clause (xvi) of the definition of Restricted Investment during such period,
to (b) the sum of all Fixed Charges for such period, all calculated for
Borrowers and their Subsidiaries on a Consolidated basis.
Fixed Charges - for any fiscal period, the sum of (i) Interest Expense
for such period plus (ii) scheduled principal payments on Funded Debt
(including scheduled principal payments on Capitalized Lease Obligations
but excluding the Revolver Loans).
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FLSA - the Fair Labor Standards Act of 1938.
Foreign Lender - any Lender that is organized under the laws of a
jurisdiction other than the laws of the United States, any state thereof or
the District of Columbia.
Full Payment - with respect to any of the Obligations, the full and
final payment in full, in cash (or immediately available funds) and in
Dollars, of such Obligations, including all interest, fees and other
charges payable in connection therewith under any of the Loan Documents,
whether such interest, fees or other charges accrue or are incurred prior
to or during the pendency of an Insolvency Proceeding and whether or not
any of the same are allowed or recoverable in any Bankruptcy Case pursuant
to Section 506 of the Bankruptcy Code or otherwise; with respect to any LC
Obligations represented by undrawn Letters of Credit and Banking
Relationship Debt (including Debt arising under Hedging Agreements), the
depositing of cash with Administrative Agent or delivery to Administrative
Agent of a Supporting LC, as security for the payment of such Obligations,
not to exceed 104% of the aggregate undrawn amount of such Letters of
Credit and 100% of Administrative Agent's good faith estimate of the amount
of Banking Relationship Debt due and to become due after termination of
such Bank Products; and with respect to any Obligations that are contingent
in nature (other than Obligations consisting of LC Obligations or Banking
Relationship Debt), such as a right of Administrative Agent or a Lender to
indemnification by any Obligor, the depositing of cash with Administrative
Agent, or delivery to Administrative Agent of a Supporting LC, in an amount
equal to 100% of such Obligations or, if such Obligations are unliquidated
in amount and represent a claim which has been overtly asserted against
Administrative Agent or a Lender and for which an indemnity has been
provided by Borrowers in any of the Loan Documents, in an amount that is
equal to such claim or Administrative Agent's good faith estimate of such
claim. None of the Loans shall be deemed to have been paid in full until
all Commitments related to such Loans have expired or been terminated.
Funded Debt - with respect to Borrowers and their Subsidiaries, the
sum, without duplication, of (i) the aggregate amount of Debt of Borrowers
and their Subsidiaries consisting of or relating to (a) the borrowing of
money or the obtaining of credit (other than trade payables incurred in the
Ordinary Course of Business), including the Obligations, Debt under the
Senior Notes and the Senior Subordinated Notes, and any other notes or
bonds, (b) the deferred purchase price of assets (other than trade payables
incurred in the Ordinary Course of Business), or (c) Capitalized Lease
Obligations, plus (ii) Debt of the type referred to in clause (i) of
another Person guaranteed by a Borrower or Subsidiary, in each case as
determined on a Consolidated basis.
GAAP - generally accepted accounting principles in the United States
of America in effect from time to time.
General Intangibles - shall have the meaning given to the term
"general intangibles" in the UCC and shall include each Borrower's choses
in action, causes of action, company or other business records, inventions,
blueprints, designs, patents, patent applications, trademarks, trademark
applications, trade names, trade secrets, service marks, goodwill, brand
names, copyrights, registrations, licenses, franchises, customer lists,
permits, tax refund claims, computer programs, operational manuals,
internet addresses and domain names, insurance refunds and premium rebates,
all rights to indemnification and all other intangible property of such
Borrower of every kind and nature (other than Accounts).
Goods - shall have the meaning given to the term "goods" in the UCC.
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Government Payor - any Third Party Payor which is (i) the United
States of America acting under the Medicaid or Medicare programs
established pursuant to the Social Security Act, or under the TRICARE
program, (ii) any state or the District of Columbia acting pursuant to a
health plan adopted pursuant to Title XIX of the Social Security Act (or
any successor legislation), (iii) any other Governmental Authority or (iv)
an agent, carrier, administrator or intermediary for any of the foregoing.
Governmental Approvals - all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to,
all Governmental Authorities.
Governmental Authority - any federal, state, municipal, national,
foreign or other governmental department, commission, board, bureau, court,
agency or instrumentality or political subdivision thereof or any entity or
officer exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to any government or any court,
in each case whether associated with a state of the United States, the
District of Columbia or a foreign entity or government.
Governmental Receivable - a Retail Receivable in respect of which the
Third Party Payor is a Government Payor.
Guarantors - Parent and each Person who hereafter guarantees payment
or performance of the whole or any part of the Obligations.
Guaranty - each guaranty agreement now or hereafter executed by a
Guarantor in favor of Administrative Agent with respect to any of the
Obligations.
Health-Care-Insurance Receivable - shall have the meaning given to the
term "health-care-insurance receivable" in the UCC.
Healthcare Laws - Medicaid Regulations, Medicare Regulations,
Anti-Kickback Statutes, TRICARE (10 U.S.C. Sections 1071-1106), and all
other applicable current and future laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions or binding agreements
issued, promulgated or entered into by the Food and Drug Administration,
CMS, HHS, the Office of Inspector General of HHS, the Drug Enforcement
Administration or any other Governmental Authority, including any state or
local professional licensing laws, certificate of need laws and state
reimbursement laws, relating in any way to the conduct of the business of
any Borrower or any of the Subsidiaries or the provision of healthcare
services generally.
Healthcare Purchaser - a health maintenance organization, prepaid
health clinic, managed care plan, preferred provider organization or other
institutional, governmental or commercial purchaser of healthcare services,
which has engaged any Borrower or any of the Subsidiaries to provide
diagnostic imaging services to Members of health plans offered by such
purchaser pursuant to a Private Provider Agreement.
Hedging Agreement - any interest rate protection agreement, foreign
currency exchange agreement, forward contract, currency swap agreement,
commodity price protection agreement or other interest or currency exchange
rate or commodity price hedging arrangement.
HHS - the Department of Health and Human Services.
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Hostile Acquisition - any investment in a Person, resulting in control
of such Person, involving a tender offer or proxy contest that has not been
recommended or approved by the board of directors or similar body of such
Person that is the subject of the investment prior to the first public
announcement or disclosure relating to such investment.
Impermissible Qualification - any qualification or exception to the
opinion or certification of any independent public accountant as to any
financial statement of Borrowers which (i) is of a "going concern" or
similar nature or (ii) relates to the limited scope of examination of
matters relevant to such financial statements.
Indemnitees - the Administrative Agent Indemnitees, the Lender
Indemnitees, Issuing Bank Indemnitees, and the BofA Indemnitees.
Indentures - collectively, the Senior Note Indenture and the Senior
Subordinated Note Indenture.
Initial Lender - BofA, in its capacity as a "Lender" under this
Agreement on the Restatement Effective Date.
Insolvency Proceeding - any action, case or proceeding commenced by or
against a Person under any state, federal or foreign law, or any agreement
of such Person for (i) the entry of an order for relief under any chapter
of the Bankruptcy Code or other insolvency or debt adjustment law (whether
state, federal or foreign), (ii) the appointment of a receiver (or
administrative receiver), trustee, liquidator, administrator, conservator
or other custodian for such Person or any part of its Property, (iii) an
assignment or trust mortgage for the benefit of creditors of such Person,
or (iv) the liquidation, dissolution or winding up of the affairs of such
Person.
Instrument - shall have the meaning given to the term "instrument" in
the UCC.
Intellectual Property - all intellectual and similar Property of a
Person of every kind and description, including inventions, designs,
patents, patent applications, copyrights, trademarks, service marks, trade
names, mask works, trade secrets, proprietary information, know-how,
software and databases and all embodiments or fixations thereof and related
documentation, registrations and franchises, all books and records
describing or used in connection with the foregoing and all licenses, or
other rights to use any of the foregoing.
Interest Expense - for any period, interest expense (other than
interest payable-in-kind) for such period minus interest income for such
period.
Interest Period - shall have the meaning ascribed to it in SECTION
3.1.3.
Investment Accounts - InSight Health Services Corp. account no. 881586
maintained with BofA and InSight Health Corp. investment sweep account no.
211500418005 maintained with Banc of America Securities, LLC, and any
replacement of either of the foregoing.
Investment Property - shall have the meaning given to the term
"investment property" in the UCC and shall include all Securities (whether
certificated or uncertificated), security entitlements, securities
accounts, commodity contracts and commodity accounts.
Issuing Bank - BofA or an Affiliate of BofA.
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Issuing Bank Indemnitees - Issuing Bank and all of its present and
future officers, directors, employees, agents and attorneys.
LC Application - an application by any or all Borrowers to Issuing
Bank, pursuant to a form approved by Issuing Bank, for the issuance of a
Letter of Credit, that is submitted to Issuing Bank at least 3 Business
Days prior to the requested issuance of such Letter of Credit.
LC Conditions - the following conditions, the satisfaction of each of
which is required before Issuing Bank shall be obligated to issue a Letter
of Credit: (i) each of the conditions set forth in SECTION 11.2 has been
and continues to be satisfied, including the absence of any Default or
Event of Default; (ii) after giving effect to the issuance of the requested
Letter of Credit and all other unissued Letters of Credit for which an LC
Application has been signed by a Borrower and approved by Administrative
Agent and Issuing Bank, the LC Obligations would not exceed $10,000,000 and
no Out-of-Formula Condition would exist, and, if no Revolver Loans are
outstanding, the LC Obligations do not, and would not upon the issuance of
the requested Letter of Credit, exceed the Borrowing Base; (iii) such
Letter of Credit has an expiration date that is no more than 1 year from
the date of issuance; (iv) the currency in which payment is to be made
under the Letter of Credit is Dollars; and (v) the form of the proposed
Letter of Credit is satisfactory to Administrative Agent and Issuing Bank
in their reasonable discretion, provides for sight drafts only and does not
contain any language that automatically increases the amount available to
be drawn under the Letter of Credit.
LC Documents - any and all agreements, instruments and documents
(including an LC Application) required by Issuing Bank to be executed by
Borrowers or any other Person and delivered to Issuing Bank for the
issuance, amendment or renewal of a Letter of Credit.
LC Facility - the subfacility for Letters of Credit established as
part of the Revolver Commitments pursuant to Section 2.3.
LC Obligations - on any date, an amount (in Dollars) equal to the sum
of (without duplication) (i) all amounts then due and payable by any
Obligor on such date by reason of any payment that is made by Issuing Bank
under a Letter of Credit that has not been repaid to Issuing Bank, plus
(ii) the aggregate undrawn amount of all Letters of Credit which are then
outstanding or for which an LC Application has been delivered to and
accepted by Issuing Bank, plus (iii) all fees and other amounts due or to
become due in respect of Letters of Credit outstanding on such date.
LC Request - a Letter of Credit Request from Borrowers to Issuing Bank
in the form of EXHIBIT I annexed hereto.
LC Reserve - at any date, the aggregate of all LC Obligations on such
date, other than (i) LC Obligations that Borrowers shall Cash Collateralize
on or prior to such date and (ii) the portion of LC Obligations described
in clause (iii) of the definition thereof.
Lender Indemnitees - Lenders and all of their respective present and
future officers, directors, employees, agents and attorneys.
Lenders - shall have the meaning given to it in the preamble to this
Agreement and shall include BofA (whether in its capacity as a provider of
Loans under SECTION 2 or as the provider of Swingline Loans under SECTION
4.1.3 ) and any other Person who may from time to time become a "Lender"
under this Agreement.
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Letter of Credit - any standby letter of credit issued by Issuing Bank
for the account of any Borrower.
Letter-of-Credit Right - shall have the meaning given to the term
"letter-of-credit-right" in the UCC.
LIBOR Lending Office - with respect to a Lender, the office designated
as a LIBOR Lending Office for such Lender on the signature page hereof (or
on any Assignment and Acceptance, in the case of an assignee) and such
other office of such Lender or any of its Affiliates that is hereafter
designated by written notice to Administrative Agent.
LIBOR Loan - a Loan, or portion thereof, during any period in which it
bears interest at a rate based upon the applicable Adjusted LIBOR Rate.
Lien - any mortgage, pledge, hypothecation, collateral assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or
other security interest or preferential arrangement in the nature of a
security interest of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, any easement, right of
way or other encumbrance on title to real property). For the purpose of
this Agreement, a Borrower shall be deemed to be the owner of any Property
which it has acquired or holds subject to a conditional sale agreement or
other arrangement pursuant to which title to the Property has been retained
by or vested in some other Person for security purposes.
Lien Waiver - an agreement duly executed in favor of Administrative
Agent, in form and content acceptable to Administrative Agent, by which for
locations leased by an Obligor, an owner or mortgagee of premises upon
which any Property of an Obligor is located agrees to waive or subordinate
any Lien it may have with respect to such Property in favor of
Administrative Agent's Lien therein and to permit Administrative Agent to
enter upon such premises and remove such Property or to use such premises
to store or dispose of such Property.
Liquidity - on any date, an amount equal to the sum of (i)
Availability on such date plus (ii) the amount of Eligible Cash on such
date.
Loan - a Revolver Loan (and each Base Rate Loan and LIBOR Loan
comprising such Loan).
Loan Account - the loan account established by each Lender on its
books pursuant to SECTION 5.8.
Loan Documents - this Agreement, the Other Agreements and the Security
Documents.
Loan Year - a period commencing each calendar year on the same month
and day as the date of this Agreement and ending on the same month and day
in the immediately succeeding calendar year, with the first such period
(i.e. the first Loan Year) to commence on the date of this Agreement.
Management Agreement - that certain management agreement dated as of
October 17, 2001, among J.W. Childs Advisors II, L.P., Halifax Genpar,
L.P., Parent and InSight Health, as the same may be amended, modified,
restated or supplemented from time to time to the extent not adverse in any
material respect to Administrative Agent or Lenders.
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Margin Stock - shall have the meaning ascribed to it in Regulation U
and of the Board of Governors.
Material Adverse Effect - the effect of any event, condition, action,
omission or circumstance, which, alone or when taken together with other
events, conditions, actions, omissions or circumstances occurring or
existing concurrently therewith, (i) has any material adverse effect upon
the business, operations, Properties or financial condition of any Obligor;
(ii) has or could be reasonably expected to have any material adverse
effect whatsoever upon the validity or enforceability of this Agreement or
any of the other Loan Documents; (iii) has any adverse effect upon the
Liens of Administrative Agent with respect to the Collateral or the
priority of any such Liens; (iv) has any material adverse effect upon the
ability of any Obligor to perform its obligations under this Agreement or
any of the other Loan Documents, including repayment of any of the
Obligations when due; or (v) has any material adverse effect upon the
ability of Administrative Agent or any Lender to enforce or collect the
Obligations or realize upon any of the Collateral in accordance with the
Loan Documents and Applicable Law.
Material Contract - an agreement to which an Obligor is a party (other
than the Loan Documents) for which breach, termination, cancellation,
nonperformance or failure to renew could reasonably be expected to have a
Material Adverse Effect.
Maximum Rate - the maximum non-usurious rate of interest permitted by
Applicable Law that at any time, or from time to time, may be contracted
for, taken, reserved, charged or received on the Debt in question or, to
the extent that at any time Applicable Law may thereafter permit a higher
maximum non-usurious rate of interest, then such higher rate.
Notwithstanding any other provision hereof, the Maximum Rate shall be
calculated on a daily basis (computed on the actual number of days elapsed
over a year of 365 or 366 days, as the case may be).
Medicaid Certification - certification by CMS or a state agency or
entity under contract with CMS that health maintenance, management or care
operations are in material compliance with all of the conditions of
participation set forth in the Medicaid Regulations.
Medicaid Provider Agreement - an agreement entered into between a
state agency or other such entity administering the Medicaid program and a
health maintenance management or care operation under which the health
maintenance, management or care operation agrees to provide services for
Medicaid patients in accordance with the terms of the agreement and
Medicaid Regulations.
Medicaid Regulations - collectively, (i) all federal statutes (whether
set forth in Title XIX of the Social Security Act or elsewhere) affecting
the medical assistance program established by Title XIX of the Social
Security Act and any statute succeeding thereto); (ii) all applicable
provisions of all federal rules, regulations, manuals and orders of all
Governmental Authorities promulgated pursuant to or in connection with the
statutes described in clause (i) above and all federal administrative,
reimbursement and other guidelines of all Governmental Authorities having
the force of law promulgated pursuant to or in connection with the statutes
described in clause (i) above; (iii) all state statutes and plans for
medical assistance enacted in connection with the statutes and provisions
described in clauses (i) and (ii) above; and (iv) all applicable provisions
of all rules, regulations, manuals and orders of all Governmental
Authorities promulgated pursuant to or in connection with the statutes
described in clause (iii) above and all stated administrative,
reimbursement and other guidelines of all Governmental Authorities having
the force of law promulgated pursuant to or in connection with the statutes
described in clause (ii) above.
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Medicare Certification - certification by CMS or a state agency or
entity under contract with CMS that the health maintenance, management or
care operation is in material compliance with all of the conditions of
participation set forth in the Medicare Regulations.
Medicare Provider Agreement - an agreement entered into between a
state agency or other such entity administering the Medicare program and a
health maintenance, management or care operation under which the health
maintenance, management or care operation agrees to provide services for
Medicare patients in accordance with the terms of the agreement and
Medicare Regulations.
Medicare Regulations - collectively, all federal statutes (whether set
forth in Title XVIII of the Social Security Act or elsewhere) affecting the
health insurance program for the aged and disabled established by Title
XVIII of the Social Security Act and any statute succeeding thereto,
together with applicable provisions of all rules, regulations, manuals and
orders and administrative, reimbursement and other guidelines having the
force of law of Governmental Authorities (including HHS, CMS, the Office of
the Inspector General for HHS or any Persons succeeding to the functions of
any of the foregoing) promulgated pursuant to or in connection with any of
the foregoing having the force of law.
Member - an individual who is a member, subscriber or enrollee, or any
dependent of any member subscriber or enrollee, under any health plan
offered by a Healthcare Purchaser.
Money Borrowed - as applied to any Obligor, without duplication, (i)
Debt arising from the lending of money by any other Person to such Obligor;
(ii) Debt, whether or not in any such case arising from the lending of
money by another Person to such Obligor, (A) which is represented by notes
payable or drafts accepted that evidence extensions of credit, or (B) which
constitutes obligations evidenced by bonds, debentures, notes or similar
instruments, (iii) Debt that constitutes a Capitalized Lease Obligation;
(iv) reimbursement obligations with respect to letters of credit or
guaranties of letters of credit; and (v) Debt of such Obligor under any
guaranty of obligations that would constitute Debt for Money Borrowed under
clauses (i) through (iii) hereof, if owed directly by such Obligor.
Monthly Cash Collections - for any month, an amount equal to (i) Cash
collections by Borrowers on account of Wholesale Receivables for such month
plus (ii) Cash collections by Borrowers on account of Retail Receivables
for such month plus (iii) Cash reimbursements to Borrowers from
Subsidiaries that are not Borrowers for such month minus Cash refunds made
by Borrowers during such month.
Moody's - Moody's Investors Services, Inc.
Multiemployer Plan - has the meaning set forth in Section 4001(a)(3)
of ERISA.
Notes - each Revolver Note and any other promissory note executed by
Borrowers at Administrative Agent's request to evidence any of the
Obligations.
Notice of Borrowing - as defined in SECTION 4.1.1(I).
Notice of Conversion/Continuation - as defined in SECTION 3.1.2(II).
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Obligations - in each case, whether now in existence or hereafter
arising, (i) the principal of, and interest and premium, if any, on the
Loans, (ii) all LC Obligations and all other obligations of any Obligor to
Administrative Agent or Issuing Bank arising in connection with the
issuance of any Letter of Credit, (iii) all liabilities and obligations of
Borrowers under any indemnity for Claims, (iv) all Extraordinary Expenses,
and (v) all other Debts, liabilities, covenants, duties and obligations
(including Contingent Obligations) now or at any time or times hereafter
owing by any Obligor to Administrative Agent or any Lender under or
pursuant to this Agreement or any of the other Loan Documents, or owing by
any Obligor to Administrative Agent or BofA (or any Affiliate of BofA) with
respect to Banking Relationship Debt, in each case, whether evidenced by
any note or other writing, whether arising from any extension of credit,
opening of a letter of credit, acceptance, loan, guaranty, indemnification
or otherwise and whether direct or indirect, absolute or contingent, due or
to become due, primary or secondary, or joint or several, including all
interest, charges, expenses, fees or other sums chargeable to any or all
Obligors under any of the Loan Documents.
Obligor - each Borrower and each Guarantor, and any other Person that
is at any time liable for the payment of the whole or any part of the
Obligations or that has granted in favor of Administrative Agent a Lien
upon any of such Person's assets to secure payment of any of the
Obligations.
Ordinary Course of Business - with respect to any transaction
involving any Person, the ordinary course of such Person's business, as
undertaken by such Person in good faith and not for the purpose of evading
any covenant or restriction in any Loan Document.
Organic Documents - with respect to any Person, its charter,
certificate or articles of incorporation, bylaws, articles of organization,
limited liability agreement, operating agreement, members agreement,
partnership agreement, certificate of partnership, certificate of formation
or similar agreement or instrument governing the formation or operation of
such Person.
OSHA - the Occupational Safety and Hazard Act of 1970.
Other Agreements - the Notes, the Fee Letter, the Lien Waiver, each
Cash Management Agreement, Hedging Agreement or other document, instrument
or agreement relating to Bank Products to which an Obligor is party with
BofA or any of its Affiliates, and any and all other agreements,
instruments and documents (other than this Agreement and the Security
Documents), heretofore, now or hereafter executed by any Borrower, any
other Obligor or any other Person and delivered to Administrative Agent or
any Lender, or otherwise executed by Administrative Agent or any Lender in
favor of any Person on behalf or for the account of an Obligor, in each
case in respect of the transactions contemplated by this Agreement or other
Loan Documents.
Out-of-Formula Condition - as defined in SECTION 2.1.2.
Out-of-Formula Loan - a Revolver Loan made or existing when an
Out-of-Formula Condition exists or the amount of any Revolver Loan which,
when funded, results in an Out-of-Formula Condition.
Parent - InSight Health Services Holdings Corp., a Delaware
corporation.
Participant - as defined in SECTION 14.2.1.
Participating Lender - as defined in SECTION 2.3.2(I).
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Payment Account - an account maintained by Administrative Agent to
which all monies from time to time deposited to a Dominion Account shall be
transferred during a Restrictive Trigger Event and all other collections on
Accounts shall be sent in immediately available federal funds.
Payment Intangible - shall have the meaning given to the term "payment
intangible" in the UCC.
Payment Item - each check, draft, or other item of payment payable to
a Borrower, including those evidencing or constituting proceeds of any of
the Collateral.
Pending Revolver Loans - at any date, the aggregate principal amount
of all Revolver Loans which have been requested in any Notice of Borrowing
received by Administrative Agent but which have not theretofore been
advanced by Administrative Agent or Lenders.
Permitted Acquisition - (i) if at the time of and after giving pro
forma effect to such Acquisition Transaction, there are no Revolver Loans
outstanding and the LC Obligations that have not been Cash Collateralized
do not exceed $2,000,000, any Acquisition Transaction, provided that such
Acquisition Transaction is not a Hostile Acquisition; and (ii) if at the
time of or after giving pro forma effect to such Acquisition Transaction,
there are Revolver Loans outstanding or the LC Obligations that have not
been Cash Collateralized exceed $2,000,000, any Acquisition Transaction,
provided that:
(a) the Acquisition Target's business is in a Permitted Business
Field;
(b) Administrative Agent shall have received copies of (i) with
respect to any Acquisition Transaction involving Acquisition Consideration
of more than $3,000,000, the Acquisition Documents, (ii) with respect to
any Acquisition Transaction involving Acquisition Consideration of more
than $3,000,000, historical financial statements, if available, or other
financial information of the Acquisition Target in form and substance
reasonably acceptable to Administrative Agent and (iii) all other financial
information, lien search results and other documents and information with
respect to the Acquisition Target as Administrative Agent may reasonably
request, all of which shall be reasonably acceptable to Administrative
Agent;
(c) if the acquired assets are to be included in the Borrowing Base
simultaneously with the consummation of the Permitted Acquisition,
Administrative Agent's examiners shall have completed a field exam of the
Acquisition Target, in scope and with results reasonably acceptable to
Administrative Agent, or if such field exam is not conducted, then the
assets of such Acquisition Target shall not be included in the Borrowing
Base and shall be ineligible for borrowing purposes until such exam is
conducted in scope and with results reasonably acceptable to Administrative
Agent;
(d) no Default or Event of Default shall exist at the time of the
Acquisition Transaction or after giving pro forma effect thereto;
(e) Borrowers shall have delivered to Administrative Agent a
certificate executed by the chief financial officer of Borrowers which
demonstrates to the reasonable satisfaction of Administrative Agent that
(i) at the time of and after giving pro forma effect to such Acquisition
Transaction Borrowers shall have Liquidity of not less than $22,500,000 and
for the 30-day period preceding the date of such Acquisition, Average
Liquidity shall not be less than $22,500,000, and (ii) at the time of such
Acquisition Transaction and after giving effect thereto,
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Borrowers shall maintain, on a pro forma basis for the 12-month period
ending on the Restatement Effective Date a Fixed Charge Coverage Ratio of
1.10 to 1.0;
(f) any Debt incurred to any or all of the sellers in connection with
such Acquisition Transaction shall be unsecured;
(g) the Acquisition Transaction is not a Hostile Acquisition;
(h) Borrower shall have notified Administrative Agent in writing of
the Acquisition Transaction (and provided to Administrative Agent an
information package with respect to the Acquisition Transaction) at least
14 days prior to the scheduled closing date of the Acquisition Transaction;
(i) if the Acquisition Transaction involves Acquisition Consideration
greater than $3,000,000, Administrative Agent contemporaneously with the
closing of such Acquisition Transaction shall have received (i) such
documents and instruments as may be necessary to grant or confirm to
Administrative Agent a first priority perfected Lien on assets of the
Acquisition Target so acquired that are consistent with the "Collateral"
hereunder and (ii) if the Acquisition Target acquired is not merged into a
Borrower or an Acquisition Subsidiary that already is a "Borrower" under
the Agreement and, after giving effect to the Acquisition Transaction, the
Acquisition Target is a wholly-owned Subsidiary of a Borrower or
Acquisition Subsidiary, Administrative Agent shall have received a Joinder
Agreement executed by such Acquisition Target, together with such other
collateral documents and opinions of counsel as may be reasonably requested
by Administrative Agent, each in form and substance reasonably satisfactory
to Administrative Agent; and
(j) Pro forma EBITDA of the Acquisition Target for the 12-month period
ending on the last day of the most recent month for which Administrative
Agent has received financial statements shall be equal to or greater than
$0.
Permitted Asset Disposition - (i) if at the time of and after giving
pro forma effect to such Asset Disposition there are no Revolver Loans
outstanding and the LC Obligations that have not been Cash Collateralized
do not exceed $2,000,000, any Asset Disposition; and (ii) if at the time of
or after giving pro forma effect to such Asset disposition there are
Revolver Loans outstanding or the LC Obligations that have not been Cash
Collateralized exceed $2,000,000, any Asset Disposition that consists of
any of the following:
(a) the disposition of damaged, obsolete or worn out Property in the
Ordinary Course of Business;
(b) the sale of inventory in the Ordinary Course of Business;
(c) dispositions permitted by SECTION 10.2.1;
(d) the sale of Equity Interests of any Subsidiary of InSight Health
to a Borrower or a Guarantor;
(e) any disposition of real Property to a Governmental Authority as a
result of a condemnation of such real Property;
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(f) the abandonment or cancellation of Intellectual Property that is
not material or is no longer used or useful in any material respect in the
business of Borrowers and their Subsidiaries, taken as a whole;
(g) licenses, leases and subleases of real or personal Property in the
Ordinary Course of Business;
(h) dispositions of Property to any Borrower, Guarantor or Subsidiary
thereof, provided that if the transferor is a Borrower or a Guarantor then
the transferee must be a Borrower or Guarantor;
(i) sales of Cash Equivalents in the Ordinary Course of Business on
ordinary business terms;
(j) non-exclusive licenses and sublicenses of Intellectual Property in
the Ordinary Course of Business;
(k) sales or forgiveness of Accounts in the Ordinary Course of
Business in connection with the collection or compromise thereof, including
sales of Accounts which arise from or constitute a workers' compensation
claim or a personal injury claim; and
(l) the disposition of Property (other than Collateral) having a fair
market value not to exceed $10,000,000 in the aggregate for any Fiscal
Year.
Permitted Business Field - the business engaged in by Borrowers on the
Restatement Effective Date or a business substantially similar or
reasonably related, complementary or incidental to the business engaged in
by Borrowers on the Restatement Effective Date and reasonable extensions
thereof.
Permitted Contingent Obligations - Contingent Obligations arising from
endorsements of items of payment for collection or deposit in the Ordinary
Course of Business; Contingent Obligations arising from Hedging Agreements
entered into in the Ordinary Course of Business; Contingent Obligations of
any Borrower and its Subsidiaries existing as of the Restatement Effective
Date, including extensions and renewals thereof that do not increase the
amount of such Contingent Obligations as of the date of such extension or
renewal; Contingent Obligations arising under indemnity agreements to title
insurers to cause such title insurers to issue to Administrative Agent
title insurance policies; Contingent Obligations with respect to customary
indemnification obligations in contracts entered into in the Ordinary
Course of Business and in favor of sellers in connection with Permitted
Acquisitions; Contingent Obligations consisting of reimbursement
obligations from time to time owing by any Borrower to Issuing Bank with
respect to Letters of Credit (but in no event to include reimbursement
obligations at any time owing by a Borrower to any other Person that may
issue letters of credit for the account of Borrowers); Contingent
Obligations of an Obligor in respect of Debt of another Obligor; Contingent
Obligations of an Obligor or any Subsidiary thereof on an unsecured basis
that do not constitute Debt of such Obligor; Contingent Obligations of a
Subsidiary that is not an Obligor in respect of obligations (including
Debt) of another Subsidiary that is not an Obligor; and other Contingent
Obligations not to exceed $25,000,000 in the aggregate at any time.
Permitted Lien - a Lien of a kind specified in SECTION 10.2.5.
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Permitted Purchase Money Debt - Purchase Money Debt of Borrowers and
their Subsidiaries that is unsecured or is secured only by a Purchase Money
Lien. For the purposes of this definition, the principal amount of any
Purchase Money Debt consisting of capitalized leases shall be computed as a
Capitalized Lease Obligation.
Permitted Restrictive Agreement - an agreement of a Borrower or a
Subsidiary which is a Restrictive Agreement by virtue of the following:
(a) conditions imposed by Applicable Law or by any Loan Document;
(b) in the case of clause (b) of the definition of Restrictive
Agreement, an agreement that applies to assets encumbered by Permitted
Liens as long as such restriction applies only to the asset encumbered by
such Permitted Lien;
(c) restrictions and conditions contained in such agreement existing
on the Restatement Effective Date (but shall not apply to any amendment or
modification expanding the scope of any such restriction or condition);
(d) restrictions in such agreement in effect at the time any Person
becomes a Subsidiary of a Borrower, provided that such agreement was not
entered into in contemplation of such Person becoming a Subsidiary of a
Borrower;
(e) customary restrictions and conditions contained in agreements
relating to the sale of a Subsidiary of a Borrower (or the assets of a
Subsidiary of a Borrower) pending such sale, provided such restrictions and
conditions apply only to the Subsidiary of such Borrower that is to be sold
(or whose assets are to be sold) and such sale is permitted hereunder;
(f) in the case of clause (b) of the definition of Restrictive
Agreement, customary provisions in leases and contracts in the Ordinary
Course of Business between a Borrower or any of its Subsidiaries and its
customers and other contracts restricting the assignment thereof;
(g) restrictions in the Senior Note Documents and the Senior
Subordinated Note Documents;
(h) restrictions in agreements governing Debt listed in SCHEDULE
10.2.3 and Refinancing Debt thereof and that are no more restrictive, taken
as a whole, with respect to such restrictions than those contained in such
agreements on the Restatement Effective Date;
(i) customary provisions with respect to the disposition or
distribution of assets or Property, and provisions restricting the
incurrence of the Obligations, in joint venture agreements, limited
liability company operating agreements, partnership agreements and
stockholders agreements for Affiliates that are not Borrowers; and
(j) customary provisions with respect to the disposition or
distribution of assets or Property in asset sale agreements, agreements in
respect of sales of Equity Interests and other similar agreements entered
into in connection with transactions not prohibited under this Agreement,
provided that such encumbrance or restriction shall only be effective
against the assets or Property that are the subject of such agreements.
Permitted Senior Subordinated Note Repurchase - the repurchase or
redemption of Senior Subordinated Notes (i) on or within 2 Business Days
after the Restatement Effective Date for an
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amount equal to $50,000,000 and (ii) any subsequent repurchase or
redemption of Senior Subordinated Notes so long as the following conditions
are satisfied, as determined by Administrative Agent:
(a) if there are any Revolver Loans outstanding at the time of or if
Revolver Loans are employed for such repurchase or redemption, the Fixed
Charge Coverage Ratio for the 12-month period ending as of the last day of
the most recent month for which financial statements have been received by
Administrative Agent in accordance with SECTION 10.1.3(A) preceding the
date of repurchase or redemption is at least 1.1 to 1.0 on a pro forma
basis after giving effect to such repurchase or redemption;
(b) Liquidity at the time of such repurchase and after giving pro
forma effect thereto is at least $22,500,000;
(c) no Event of Default exists or would result therefrom;
(d) Borrower Agent shall have given Administrative Agent at least 5
Business Days prior written notice of such Permitted Senior Subordinated
Notes Repurchase;
(e) simultaneously with any Permitted Senior Subordinated Notes
Repurchase, the acquired Senior Subordinated Notes shall be cancelled;
(f) both before and after giving pro forma effect to any Permitted
Senior Subordinated Notes Repurchase, each Borrower and each of its
Subsidiaries is Solvent; and
(g) on or immediately before the effective date of any Permitted
Senior Subordinated Notes Repurchase, Borrower Agent shall have furnished
to Administrative Agent a certificate setting forth, in reasonable detail,
Borrower Agent's calculation of the amounts to be paid in Cash in respect
of principal of Senior Subordinated Notes to be repurchased and the accrued
and unpaid interest, premium, fees, expenses and commissions payable in
connection with closing such Permitted Senior Subordinated Notes
Repurchase, together with the calculations required to determine compliance
with this definition of Permitted Senior Subordinated Note Repurchase.
Person - an individual, partnership, corporation, limited liability
company, limited liability partnership, joint stock company, land trust,
business trust, or unincorporated organization, or a Governmental
Authority.
Plan - an employee pension benefit plan that is covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the
Internal Revenue Code and that is either (i) maintained by Borrower for
employees or (ii) maintained pursuant to a collective bargaining agreement
or any other arrangement under which more than one employer makes
contributions and to which Borrower is then making or accruing an
obligation to make contributions or has within the preceding 5 years made
or accrued such contributions.
Private Provider Agreement - an agreement entered into between any
Borrower and a Healthcare Purchaser under which such Borrower agrees to
provide services for Members of a health plan offered by such Healthcare
Purchaser.
Professional Fees Allowance - on any date, an amount equal to that
portion of aggregate uncollected Retail Receivables that, upon collection,
will be payable to physicians as fees and other amounts due from Borrowers
under all PSAs.
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Professional Fees Reserve - on any date, an amount equal to that
portion of Accounts that have been collected by Borrowers as of such date
that is due from Borrowers to physicians as fees and other amounts due from
Borrowers under all PSAs, as adjusted to deduct amounts attributable to and
owing by Subsidiaries that are not Borrowers to the extent that such
Subsidiaries have sufficient Cash on hand to pay such amounts as are due
and payable as of such date.
Pro Rata - with respect to any Lender on any date, a percentage (
expressed as a decimal rounded to the ninth decimal place) arrived at by
dividing the amount of the Total Commitments of such Lender on such date by
the aggregate amount of the Commitments of all Lenders on such date.
Projections - (i) prior to the Restatement Effective Date and
thereafter until Administrative Agent and Lenders receive new projections
pursuant to SECTION 10.1.5, the projections of Borrowers' financial
condition, results of operations, and cash flow for the Fiscal Year ending
June 30, 2006; and (ii) thereafter, the projections most recently received
by Administrative Agent and Lenders pursuant to and as required by SECTION
10.1.5.
Properly Contested - in the case of any Debt or Tax of an Obligor that
is not paid as and when due or payable by reason of such Obligor's bona
fide dispute concerning its liability to pay same or concerning the amount
thereof, (i) such Debt or Tax is being properly contested in good faith by
appropriate proceedings promptly instituted and diligently conducted; (ii)
such Obligor has established appropriate reserves as shall be required in
conformity with GAAP; (iii) the non-payment of such Debt or Tax will not
reasonably be expected to have a Material Adverse Effect and will not
result in a forfeiture or sale of any Collateral; (iv) no Lien is imposed
upon any Collateral with respect to such Debt or Tax unless such Lien is at
all times junior and subordinate in priority to the Liens in favor of
Administrative Agent (except only with respect to property taxes that have
priority as a matter of Applicable Law) and enforcement of such Lien is
stayed during the period prior to the final resolution or disposition of
such dispute; and (v) if the Debt or Tax results from, or is determined by
the entry, rendition or issuance against an Obligor of a judgment, writ,
order or decree, enforcement of such judgment, writ, order or decree is
stayed pending a timely appeal or other judicial review.
Property - any interest in any kind of property or asset, whether
real, personal or mixed and whether tangible or intangible.
Provider Agreement - the Medicaid Provider Agreement, the Medicare
provider Agreement, any Private Provider Agreement or any other agreement
by which a Third Party Payor is obligated to pay for services rendered to
patients of any Borrower, or all of them, as the context requires.
PSA - each Professional Services Agreement entered into by a Borrower
and a physician or group of physicians in connection with the provision of
diagnostic imaging services.
Purchase Money Debt - means and includes (i) Debt (other than the
Obligations) for the payment of all or any part of the purchase price of
any fixed asset, (ii) any Debt (other than the Obligations) incurred at the
time of or within 90 days prior to or after the acquisition of any fixed
asset for the purpose of financing all or any part of the purchase price
thereof, and (iii) any renewals, extensions or refinancings (but not any
increases in the principal amounts) thereof outstanding at the time.
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Purchase Money Lien - a Lien upon fixed assets which secures Purchase
Money Debt, but only if such Lien shall at all times be confined solely to
the fixed assets acquired through the incurrence of the Purchase Money Debt
secured by such Lien.
RCRA - the Resource Conservation and Recovery Act (42 U.S.C. Sections
6991-6991i).
Refinancing Conditions - the following conditions, each of which must
be satisfied before Refinancing Debt shall be permitted under SECTION
10.2.3: (i) the Refinancing Debt is in an aggregate principal amount that
does not exceed the aggregate principal amount of the Debt being extended,
renewed or refinanced (except by an amount equal to accrued interest
thereon and the amount of all reasonable costs, expenses and premiums
incurred in connection with such extension, renewal or refinancing), (ii)
the Refinancing Debt has a later or equal final maturity and a longer or
equal weighted average life than the Debt being extended, renewed or
refinanced, (iii) the Refinancing Debt does not bear a rate of interest
that exceeds, as of the date of such extension, renewal or refinancing, a
market rate (as determined in good faith by a Senior Officer) for Debt of
such type issued by an entity similar to the Borrower that is liable on the
Debt being extended, renewed or refinanced, (iv) if the Debt being
extended, renewed or refinanced is subordinate to the Obligations, the
Refinancing Debt is subordinated to the same extent (except in the case of
Permitted Senior Subordinated Note Repurchases with the proceeds of Senior
Notes or Revolver Loans hereunder), (v) the covenants contained in any
instrument or agreement relating to the Refinancing Debt, taken as a whole,
are not materially less favorable to Borrowers than those relating to the
Debt being extended, renewed or refinanced, (vi) at the time of and after
giving effect to such extension, renewal or refinancing, no Default or
Event of Default shall exist, (vii) no additional Lien is granted to secure
the repayment of the Refinancing Debt (except in the case of Permitted
Senior Subordinated Note Repurchases with the proceeds of Senior Notes or
Revolver Loans hereunder), and (viii) no additional Obligor is or may
become obligated on the Refinancing Debt.
Refinancing Debt - Debt for Money Borrowed that is permitted by
SECTION 10.2.3 and that is the subject or the result of an extension,
renewal or refinancing.
Register - the register maintained by Administrative Agent in
accordance with SECTION 5.8.2.
Regulation D - Regulation D of the Board of Governors.
Reimbursement Date - as defined in SECTION 2.3.1(III).
Rentals - all payments which a lessee is required to make under the
terms of any lease.
Report - as defined in SECTION 13.1.5.
Reportable Event - any of the events set forth in Section 4043(c) of
ERISA.
Required Lenders - at any date of determination thereof, Lenders
having Commitments representing at least 51% of the aggregate Commitments
at such time; provided, however, that if any Lender shall be in breach of
any of its obligations hereunder to Borrowers or Administrative Agent,
including any breach resulting from its failure to honor its Commitment in
accordance with the terms of this Agreement, then, for so long as such
breach continues, the term "Required Lenders" shall mean Lenders (excluding
each Lender that is in breach of its obligations under this Agreement)
having Commitments representing at least 51% of the aggregate
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Commitments (excluding the Commitments of each Lender that is in breach of
its obligations under this Agreement) at such time; provided further, that
if all of the Commitments have been terminated, the term "Required Lenders"
shall mean Lenders (excluding each Lender that is in breach of its
obligations under this Agreement) holding Loans (including Swingline Loans)
representing at least 51% of the aggregate principal amount of Loans
(including Swingline Loans) outstanding at such time.
Restatement Effective Date - September 22, 2005.
Restricted Investment - any acquisition of Property by a Borrower or
any of its Subsidiaries in exchange for cash or other Property, whether in
the form of an acquisition of Equity Interests or Debt, or the purchase or
acquisition by such Borrower or any Subsidiary of any other Property, or a
loan, advance or capital contribution, except the following: (i)
acquisitions of fixed assets to be used in the Ordinary Course of Business
of such Borrower or any of its Subsidiaries; (ii) acquisitions of goods to
be used in the provision of services by such Borrower or any of its
Subsidiaries in the Ordinary Course of Business; (iii) acquisitions of
Current Assets in the Ordinary Course of Business of such Borrower or any
of its Subsidiaries; (iv) investments to the extent existing on the
Restatement Effective Date; (v) Cash Equivalents; (vi) loans and other
advances of money to the extent not prohibited by SECTION 10.2.2; (vii)
Permitted Acquisitions; (viii) Permitted Senior Subordinated Note
Repurchases; (vii) Hedging Agreements entered into in the Ordinary Course
of Business and not for speculative purposes; (ix) Debt permitted pursuant
to Section 10.2.3; (x) Distributions to the extent permitted under this
Agreement; (xi) extensions of trade credit in the Ordinary Course of
Business; (xii) Permitted Contingent Obligations; (xii) loans and advances
to employees, officers and directors of any Borrower or Guarantor or
Subsidiary thereof (a) to the extent the proceeds thereof are used to
acquire Equity Interests of Parent so long as any cash proceeds received by
Parent are contemporaneously remitted to InSight Health and (b) in the
Ordinary Course of Business (including for travel, entertainment and
relocation expenses) in an aggregate amount for all such loans and advances
permitted by this clause (b) not to exceed $500,000 at any one time
outstanding; (xiii) investments consisting of Equity Interests,
obligations, securities or other Property received by any Guarantor,
Borrower or Subsidiary thereof in settlement of Accounts (created in the
Ordinary Course of Business); (xiv) intercompany investments (a) by any
Subsidiary of InSight Health in InSight Health or another Borrower or
Guarantor, and (b) by any Subsidiary of InSight Health that is not a
Borrower or Guarantor in any Person that is not a Borrower or Guarantor;
(xv) investments in prepaid expenses, negotiable instruments held for
collection and lease, utility and workers compensation, performance and
similar deposits entered into as a result of the operations of the business
in the Ordinary Course of Business; and (xvi) expenditures of Cash to
purchase Equity Interests of or funding of loans to joint ventures or other
business organizations that are Affiliates but not Obligors.
Restrictive Agreement - an agreement that, if and for so long as an
Obligor or any Subsidiary of such Obligor is a party thereto, would
prohibit, condition or restrict such Obligor's or Subsidiary's right to:
(a) incur or repay any of the Obligations; (b) grant Liens upon any of such
Obligor's or Subsidiary's assets (including Liens granted in favor of
Administrative Agent pursuant to the Loan Documents); or (c) declare or
make Distributions; amend, modify, extend or renew any of the Loan
Documents;
Restrictive Trigger Event - for purposes of Section 8.2.5(ii), if
Liquidity is less than $15,000,000 and there are any Revolver Loans
outstanding.
Retail Collection Account - shall have the meaning ascribed to it in
SECTION 8.2.5(I).
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Retail Receivable - an Account arising from (i) the provision of
diagnostic imaging services or (ii) the provision of management of services
by InSight Health to any Subsidiary that is not a Borrower.
Retained Rights - with respect to any Governmental Receivable, the
rights of any Obligor or any Subsidiary thereof granted by Applicable Law
with respect to such Governmental Receivable, including, and as applicable,
the collection thereof and discretion over the transfer thereof to any
Person (including Administrative Agent) and to enforce the claim giving
rise to such Governmental Receivable against the applicable Governmental
Authority, in the absence of a court order in the manner expressly
contemplated by Applicable Law.
Revolver Commitment - at any date for any Lender, the obligation of
such Lender to make Revolver Loans and to purchase participations in LC
Obligations pursuant to the terms and conditions of this Agreement, which
shall not exceed the principal amount set forth opposite such Lender's name
under the heading "Revolver Commitment" on the signature pages of this
Agreement or the principal amount set forth in the Assignment and
Acceptance by which it became a Lender, as modified from time to time
pursuant to the terms of this Agreement or to give effect to any applicable
Assignment and Acceptance; and "Revolver Commitments" means the aggregate
principal amount of the Revolver Commitments of all Lenders, the maximum
amount of which on any date shall be $30,000,000, as reduced from time to
time pursuant to SECTION 2.1.5.
Revolver Loan - a loan made by Lenders as provided in SECTION 2.1
(including any Out-of-Formula Loan) or a Swingline Loan funded solely by
BofA.
Revolver Note - a Revolver Note to be executed by Borrowers in favor
of each Lender in the form of EXHIBIT A attached hereto, which shall be in
the face amount of such Lender's Revolver Commitment and which shall
evidence all Revolver Loans (other than Swingline Loans) made by such
Lender to Borrowers pursuant to this Agreement.
S&P - Standard & Poor's Ratings Group, a division of McGraw-Hill, Inc.
Schedule of Accounts - as defined in SECTION 8.2.1.
SEC - Securities and Exchange Commission.
Secured Parties - Administrative Agent, Issuing Bank, Lenders
(including BofA as the provider of Swingline Loans) and BofA (and any
Affiliate of BofA) as the provider of any Bank Products.
Security - shall have the same meaning as in Section 2(1) of the
Securities Act of 1933.
Security Agreement - the Security Agreement executed and delivered by
Parent on or before the Restatement Effective Date to secure its Debt under
its Guaranty.
Security Documents - each Guaranty, the Control Agreements, the
Security Agreement and all other instruments and agreements now or at any
time hereafter securing the whole or any part of the Obligations.
Senior Note Documents - the Senior Notes, the Senior Notes Indenture
and any and all other agreements, instruments and documents executed in
connection therewith or related thereto.
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Senior Note Indenture - the indenture to be entered into by InSight
Health and Guarantors in connection with the issuance of the Senior Notes.
Senior Notes - the $300,000,000 Senior Secured Floating Rate Notes of
InSight Health due 2011 that shall be issued under the Senior Notes
Indenture (and any Senior Secured Floating Rate Notes of InSight Health due
2011 issued in exchange therefor in an exchange offer) (plus any principal
amounts issued in lieu of Cash interest).
Senior Notes Trustee - U.S. Bank National Association, and any of its
successors and assigns.
Senior Officer - the chairman of the board of directors, the president
or the chief financial officer of a Borrower.
Senior Subordinated Notes - the 9-7/8% Senior Subordinated Notes due
2001 issued by InSight Health, in the aggregate original principal amount
of $250,000,000.
Senior Subordinated Note Documents - the Senior Subordinated Notes,
the Senior Subordinated Notes Indenture and any and all other agreements,
instruments and documents executed in connection therewith or related
thereto.
Senior Subordinated Notes Indenture - the Indenture dated October 31,
2001, among U.S. Bank National Association, as Trustee, and InSight Health
and Guarantors, pursuant to which InSight Health issued the Senior
Subordinated Notes.
Settlement Report - a report delivered by Administrative Agent to
Lenders summarizing the amount of the outstanding Revolver Loans as of the
Settlement Date and the calculation of the Borrowing Base as of such
Settlement Date.
Social Security Act - the Social Security Act as codified at 42 U.S.C.
Section 1395 et seq.
Software - shall have the meaning given to the term "software" in the
UCC.
Solvent - as to any Person, such Person (i) owns Property whose fair
salable value is greater than the amount required to pay all of such
Person's debts (including contingent, subordinated, unmatured and
unliquidated liabilities), (ii) owns Property whose present fair salable
value (as defined below) is greater than the probable total liabilities
(including contingent, subordinated, unmatured and unliquidated
liabilities), of such Person as they become absolute and matured, (iii) is
able to pay all of its debts as such debts mature, (iv) has capital that is
not unreasonably small for its business and is sufficient to carry on its
business and transactions and all business and transactions in which it is
about to engage, (v) is not "insolvent" within the meaning of Section
101(32) of the Bankruptcy Code, and (vi) has not incurred (by way of
assumption or otherwise) any obligations or liabilities (contingent or
otherwise) under any of the Loan Documents, or made any conveyance pursuant
to or in connection therewith, with actual intent to hinder, delay or
defraud either present or future creditors of such Person or any of its
Subsidiaries. As used herein, the term "fair salable value" of a Person's
assets means the amount that may be realized within a reasonable time,
either through collection or sale of such assets at the regular market
value, based upon the amount that could be obtained for such assets within
such period by a capable and diligent seller from an interested buyer who
is willing (but is under no compulsion) to purchase under ordinary selling
conditions.
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Sponsor Related Party - (i) any controlling stockholder, partner,
member, 80% (or more) owned Subsidiary, or immediate family member (in the
case of an individual) of any Sponsor or (ii) any trust, corporation,
partnership or other entity, the beneficiaries, stockholders, partners,
owners or Persons beneficially holding an 80% or more controlling interest
of which consist of any one or more of the Sponsors and/or such other
Persons referred to in the immediately preceding clause (i).
Sponsors - means J.W. Childs Associates, L.P., J.W. Childs Equity
Partners II, L.P., The Halifax Group, L.L.C, Halifax Capital Partners, L.P.
and their respective Affiliates
Statutory Reserves - on any date, the percentage (expressed as a
decimal) established by the Board of Governors which is the then stated
maximum rate for all reserves (including all basic, emergency, supplemental
or other marginal reserve requirements and taking into account any
transitional adjustments or other scheduled in reserve requirements)
applicable to any member bank of the Federal Reserve System in respect to
Eurocurrency Liabilities (or any successor category of liabilities under
Regulation D). Such reserve percentage shall include those imposed pursuant
to said Regulation D. The Statutory Reserve shall be adjusted automatically
on and as of the effective date of any change in such percentage.
Subordinated Debt - Debt incurred by a Borrower that is expressly
subordinated and made junior in right of payment to the Full Payment of the
Obligations and, to the extent that such Debt is incurred on or after the
Restatement Effective Date, such Debt is payable on terms and conditions
(including terms relating to interest, fees, repayment and subordination)
that are reasonably satisfactory to Administrative Agent.
Subsidiary - any Person in which more than 50% of its outstanding
Voting Securities is owned directly or indirectly by a Borrower, by one or
more other Subsidiaries of such Borrower or by a Borrower and one or more
other Subsidiaries.
Supporting LC - an irrevocable letter of credit that is in form and
substance reasonably acceptable to Administrative Agent, issued or
confirmed by a bank reasonably acceptable to Administrative Agent, and
payable in Dollars at a place of payment within the United States that is
reasonably acceptable to Administrative Agent, which letter of credit names
Administrative Agent as the beneficiary thereof.
Supporting Obligation - shall have the meaning given to the term
"supporting obligation" in the UCC.
Swingline Loan - as defined in SECTION 4.1.3 (II).
Taxes - any present or future taxes, levies, imposts, duties, fees,
assessments, deductions, withholdings or other charges of whatever nature,
including income, receipts, excise, property, sales, use, transfer,
license, payroll, withholding, social security and franchise taxes now or
hereafter imposed or levied by the United States or any other Governmental
Authority and all interest, penalties, additions to tax and similar
liabilities with respect thereto, but excluding Excluded Taxes.
Term - as defined in SECTION 6.1.
Third Party Payor - any Person (other than the customer or patient)
that is responsible for payment of all or any portion of an Account,
including any commercial or non-profit insurer, any
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Healthcare Purchaser and any Governmental Authority making payment pursuant
to any Healthcare Law. For the avoidance of doubt, the term "Third Party
Payors" shall include all Government Payors and all Commercial Payors.
Transferee - as defined in SECTION 14.3.3.
Type - any type of a Loan determined with respect to the interest
option applicable thereto, which shall be either a LIBOR Loan or a Base
Rate Loan.
UCC - the Uniform Commercial Code (or any successor statute) as
adopted and in force in the State of New York or, when the laws of any
other state govern the method or manner of the perfection or enforcement of
any security interest in any of the Collateral, the Uniform Commercial Code
(or any successor statute) of such state.
Undrawn Amount - on any date with respect to a particular Letter of
Credit, the total amount then available to be drawn under such Letter of
Credit in Dollars.
Unused Line Fee - as defined in SECTION 3.2.2.
Upstream Payment - collectively:
(a) Distributions by a Subsidiary to a Borrower or any Obligor (other
than Parent);
(b) Distributions by a Subsidiary of a Borrower that is not
wholly-owned by such Borrower to the holders of its Equity Interests,
provided that such Distributions are made pro rata to all holders of its
Equity Interests, taking into account the relative preferences, if any, on
the various classes of Equity Interests of such non-wholly owned
Subsidiary;
(c) so long as no Default or Event of Default shall have occurred and
be continuing, Distributions by InSight Health to Parent to permit Parent
to purchase, redeem or otherwise acquire or retire for value Parent's
Equity Interests from present or former officers, directors or employees of
any Obligor or Subsidiary thereof (or permitted transferees, assigns,
estates or heirs of the foregoing) upon the death, disability or
termination of employment of such officer, director or employee, provided,
that the aggregate amount of payments under this paragraph (c) after the
Restatement Effective Date (net of (i) repayment of loans related to Equity
Interests made by an Obligor or Subsidiary thereof pursuant to clause
(xii)(a) of the definition of Restricted Investment and repaid in
connection with such purchase, redemption or other acquisition for value of
such Equity Interests and (ii) any proceeds received by Parent and
contributed to InSight Health after the date hereof in connection with
resales of any Equity Interests so purchased) shall not exceed $7,500,000
in the aggregate;
(d) Distributions to Parent for its proportionate share (as determined
based upon pre-tax income) of the tax liability of the affiliated group of
corporations that file consolidated federal income tax returns (or that
file state or local income tax returns on a consolidated basis), provided
that any refunds received by Parent attributable to InSight Health or any
of its Subsidiaries shall promptly be returned by Parent to InSight Health
through a contribution or purchase of common Equity Interests of InSight
Health from InSight Health;
(e) Distributions to Parent in amounts required for the Parent to pay
franchise taxes and other fees required to maintain its existence and
provide for all other customary operating costs of Parent to the extent
attributable to the ownership and operation of InSight Health and its
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Subsidiaries, including in respect of director fees and expenses,
administrative, legal and accounting services provided by third parties and
other customary costs and expenses including all costs and expenses with
respect to filings with the SEC;
(f) Distributions to Parent to the extent necessary to enable the
payment of management fees permitted under SECTION 10.2.4; and
(g) cashless exercises of options or warrants.
USA Patriot Act - the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001,
Pub. L. No. 107-56, 115 Stat. 272 (2001).
Voting Securities - Equity Interests of any class or classes of a
corporation or other entity the holders of which are ordinarily, in the
absence of contingencies, entitled to elect a majority of the corporate
directors or individuals performing similar functions.
Wholesale Collection Account - shall have the meaning ascribed to it
in SECTION 8.2.5(I).
Wholesale Receivable - an Account that is not a Retail Receivable.
1.2. ACCOUNTING TERMS. Unless otherwise specified herein, all terms of an
accounting character used in this Agreement shall be interpreted, all accounting
determinations under this Agreement shall be made, and all financial statements
required to be delivered under this Agreement shall be prepared in accordance
with GAAP, applied on a basis consistent with the most recent audited
Consolidated financial statements of Borrowers and their Subsidiaries heretofore
delivered to Administrative Agent and Lenders, except for any change required by
GAAP.
1.3. OTHER TERMS. All other terms contained in this Agreement shall have,
when the context so indicates, the meanings provided for by the UCC to the
extent the same are used or defined therein.
1.4. CERTAIN MATTERS OF CONSTRUCTION. The terms "herein," "hereof" and
"hereunder" and other words of similar import refer to this Agreement as a whole
and not to any particular section, paragraph or subdivision. Any pronoun used
shall be deemed to cover all genders. In the computation of periods of time from
a specified date to a later specified date, the word "from" means "from and
including" and the words "to" and "until" each means "to but excluding." The
section titles, table of contents and list of exhibits appear as a matter of
convenience only and shall not affect the interpretation of this Agreement. All
references to statutes shall include all related rules and implementing
regulations and any amendments of same and any successor statutes, rules and
regulations; to any agreement, instrument or other documents (including any of
the Loan Documents) shall include any and all modifications and supplements
thereto and any and all restatements, extensions or renewals thereof to the
extent such modifications, supplements, restatements, extensions or renewals of
any such documents are permitted by the terms thereof; to any Person (including,
Administrative Agent, a Borrower, a Lender or BofA) shall mean and include the
successors and permitted assigns of such Person; to "including" and "include"
shall be understood to mean "including, without limitation" (and, for purposes
of each Loan Document, the parties agree that the rule of ejusdem generis shall
not be applicable to limit a general statement, which is followed by or
referable to an enumeration of specific matters to matters similar to the
matters specifically mentioned); to the time of day shall mean the time of day
on the day in question in New York, New York, unless otherwise expressly
provided in this Agreement; or to the "discretion" of Administrative Agent or a
Lender shall mean the reasonable discretion of such Person. A Default or an
Event of Default shall be deemed to exist at all times during the period
commencing on the date that such
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Default or Event of Default occurs to the date on which such Default or Event of
Default is waived in writing by Administrative Agent (acting with the consent or
at the direction of the Lenders or the Required Lenders, as applicable) pursuant
to this Agreement or, in the case of a Default, is cured within any period of
cure expressly provided in this Agreement; and an Event of Default shall
"continue" or be "continuing" until such Event of Default has been waived in
writing by Administrative Agent (acting with the consent or at the direction of
the Lenders or the Required Lenders, as applicable). All calculations of Value
shall be in Dollars, all Loans shall be funded in Dollars and all Obligations
shall be repaid in Dollars. Whenever the phrase "to the best of Borrowers'
knowledge" or words of similar import relating to the knowledge or the awareness
of a Borrower are used in this Agreement or other Loan Documents, such phrase
shall mean and refer to the actual knowledge of a Senior Officer of any
Borrower.
SECTION 2. CREDIT FACILITY
Subject to the terms and conditions of, and in reliance upon the
representations and warranties made in, this Agreement and the other Loan
Documents, Lenders severally agree to the extent and in the manner hereinafter
set forth to make their respective shares of the Commitments available to
Borrowers in an aggregate amount up to $30,000,000, as set forth hereinbelow:
2.1. COMMITMENT.
2.1.1. Revolver Loans. Each Lender agrees, severally to the extent of
its Revolver Commitment and not jointly with the other Lenders, upon the terms
and subject to the conditions set forth herein, to make Revolver Loans to
Borrowers on any Business Day during the period from the Restatement Effective
Date through the Business Day before the last day of the Term, not to exceed in
aggregate principal amount outstanding at any time such Lender's Revolver
Commitment at such time, which Revolver Loans may be repaid and reborrowed in
accordance with the provisions of this Agreement; provided, however, that
Lenders shall have no obligation to Borrowers whatsoever to honor any request
for a Revolver Loan on or after the Commitment Termination Date or if at the
time of the proposed funding thereof the aggregate principal amount of all of
the Revolver Loans then outstanding (including Swingline Loans) and Pending
Revolver Loans exceeds, or would exceed after the funding of such Revolver Loan,
the Borrowing Base. Each Borrowing of Revolver Loans shall be funded by Lenders
on a Pro Rata basis in accordance with their respective Revolver Commitments
(except for BofA with respect to Swingline Loans). The Revolver Loans shall bear
interest as set forth in SECTION 3.1. Each Revolver Loan shall, at the option of
Borrowers, be made or continued as, or converted into, part of one or more
Borrowings that, unless specifically provided herein, shall consist entirely of
Base Rate Loans or LIBOR Loans.
2.1.2. Out-of-Formula Loans. If the unpaid balance of Revolver Loans
outstanding at any time should exceed the Borrowing Base at such time (an
"Out-of-Formula Condition"), such Revolver Loans shall nevertheless constitute
Obligations that are secured by the Collateral and entitled to all of the
benefits of the Loan Documents. In the event that Lenders are willing in their
discretion to make Out-of-Formula Loans or are required to do so by SECTION
13.9.4, such Out-of-Formula Loans shall be payable within 2 Business Days of
demand and shall bear interest as provided in SECTION 3.1.5 or as otherwise
agreed among Administrative Agent, Borrowers and Lenders.
2.1.3. Use of Proceeds. The proceeds of the Revolver Loans shall be
used by Borrowers solely for one or more of the following purposes: (i) to pay
any of the Obligations in accordance with this Agreement; and (ii) to make
expenditures for other lawful corporate purposes of Borrowers to the extent such
expenditures are not prohibited by this Agreement or Applicable Law. In no event
may any Revolver Loan proceeds be used by any Borrower (iii) to purchase or to
carry, or to reduce, retire or refinance any Debt incurred to purchase or carry,
any Margin Stock or for any related
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purpose that violates the provisions of Regulations T, U or X of the Board of
Governors, or (iv) to fund any operations or finance any investments or
activities in, or to make payments to, a Blocked Person.
2.1.4. Revolver Notes. The Revolver Loans made by each Lender and
interest accruing thereon shall be evidenced by the records of Administrative
Agent and such Lender and by the Revolver Note payable to such Lender (or the
assignee of such Lender), which shall be executed by Borrowers, completed in
conformity with this Agreement and delivered to such Lender. All outstanding
principal amounts and accrued interest under the Revolver Notes shall be due and
payable as set forth in SECTION 5.2.
2.1.5. Voluntary Reductions of Revolver Commitments. Borrowers shall
have the right to permanently reduce the amount of the Revolver Commitments, on
a Pro Rata basis for each Lender, at any time and from time to time upon written
notice to Administrative Agent of such reduction, which notice shall specify the
amount of such reduction, shall be irrevocable once given, shall be given at
least 5 Business Days prior to the requested reduction. Administrative Agent
shall promptly transmit such notice to each Lender. If on the effective date of
any such reduction in the Revolver Commitments and after giving effect thereto
an Out-of-Formula Condition exists, then the provisions of SECTION 5.2.1(III)
shall apply, except that such repayment shall be due immediately upon such
effective date without further notice to or demand upon Borrowers. If the
Commitments are reduced to zero, then such reduction shall be deemed a
termination of the Commitments by Borrowers pursuant to SECTION 6.2.2. The
Revolver Commitments, once reduced, may not be reinstated without the written
consent of all Lenders.
2.2. RESERVED.
2.3. LC FACILITY.
2.3.1. Issuance of Letters of Credit. Subject to all of the terms and
conditions hereof, Issuing Bank agrees to establish the LC Facility pursuant to
which, during the period from the date hereof to the last day of the Term,
Issuing Bank shall issue one or more Letters of Credit on Administrative Agent's
request therefor from time to time, subject to the following terms and
conditions:
(i) Each Borrower acknowledges that Issuing Bank's willingness to
issue any Letter of Credit is conditioned upon Issuing Bank's receipt of
(A) an LC Application with respect to the requested Letter of Credit and
(B) such other instruments and agreements as Issuing Bank may customarily
require for the issuance of a letter of credit of equivalent type and
amount as the requested Letter of Credit. Issuing Bank shall have no
obligation to issue any Letter of Credit unless (x) Issuing Bank receives
an LC Request and LC Application at least 3 Business Days prior to the date
of issuance of a Letter of Credit, and (y) each of the LC Conditions is
satisfied on the date of Issuing Bank's receipt of the LC Request and at
the time of the requested issuance of a Letter of Credit.
(ii) Letters of Credit may be requested by a Borrower only if
they are to be used (a) to support obligations of such Borrower incurred in
the Ordinary Course of Business of such Borrower, on a standby basis, or
(b) for such other purposes as Administrative Agent and Lenders may approve
from time to time in writing.
(iii) Borrowers shall comply with all of the terms and conditions
imposed on Borrowers by Issuing Bank that are contained in any LC
Application or in any other agreement customarily or reasonably required by
Issuing Bank in connection with the issuance of any Letter of Credit. If
Issuing Bank shall honor any request for payment under a Letter of Credit,
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Borrowers shall be jointly and severally obligated to pay to Issuing Bank,
in Dollars on the same day as the date on which payment was made by Issuing
Bank (the "Reimbursement Date"), an amount equal to the amount paid by
Issuing Bank under such Letter of Credit (or, if payment thereunder was
made by Issuing Bank in a currency other than Dollars, an amount equal to
the Dollar equivalent of such currency, as determined by Issuing Bank, as
of the time of Issuing Bank's payment under such Letter of Credit, in each
case), together with interest from and after the Reimbursement Date until
Full Payment is made by Borrowers at the Default Rate for Revolver Loans
constituting Base Rate Loans. Until Issuing Bank has received payment from
Borrowers in accordance with the foregoing provisions of this clause (iii),
Issuing Bank, in addition to all of its other rights and remedies under
this Agreement and any LC Application, shall be fully subrogated to the
rights and remedies of each beneficiary under such Letter of Credit whose
claims against Borrowers have been discharged with the proceeds of such
Letter of Credit. Whether or not a Borrower submits any Notice of Borrowing
to Administrative Agent, Borrowers shall be deemed to have requested from
Lenders a Borrowing of Base Rate Loans in an amount necessary to pay to
Issuing Bank all amounts due Issuing Bank on any Reimbursement Date and
each Lender agrees to fund its Pro Rata share of such Borrowing whether or
not any Default or Event of Default has occurred or exists, the Commitments
have been terminated, the funding of the Borrowing would result in (or
increase the amount of) any Out-of-Formula Condition, or any of the
conditions set forth in Section 11 are not satisfied.
(iv) Borrowers assume all risks of the acts, omissions or misuses
of any Letter of Credit by the beneficiary thereof. The obligation of
Borrowers to reimburse Issuing Bank for any payment made by Issuing Bank
under a Letter of Credit shall be absolute, unconditional, irrevocable and
joint and several and shall be paid without regard to any lack of validity
or enforceability of any Letter of Credit or the existence of any claim,
setoff, defense or other right which Borrowers may have at any time against
a beneficiary of any Letter of Credit. The rights, remedies, powers and
privileges of Issuing Bank under this Agreement with respect to Letters of
Credit shall be in addition to, and cumulative with, all rights, remedies,
powers and privileges of Issuing Bank under any of the LC Documents.
Nothing herein shall be deemed to release Issuing Bank from any liability
or obligation that it may have in respect to any Letter of Credit arising
out of and directly resulting from its own gross negligence or willful
misconduct.
(v) No Letter of Credit shall be extended or amended in any
respect that is not solely ministerial, unless all of the LC Conditions are
met as though a new Letter of Credit were being requested and issued.
(vi) Unless otherwise provided in any of the LC Documents, each
LC Application and each standby Letter of Credit shall be subject to the
Uniform Customs and Practice for Documentary Credits (1993 Revision),
International Chamber of Commerce No. 500, and any amendments or revisions
thereto.
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2.3.2. Participations.
(i) Immediately upon the issuance of any Letter of Credit, each
Lender shall be deemed to have irrevocably and unconditionally purchased
and received from Issuing Bank, without recourse or warranty, an undivided
interest and participation equal to the Pro Rata share of such Lender (a
"Participating Lender") in all LC Obligations arising in connection with
such Letter of Credit, but in no event greater than an amount which, when
added to such Lender's Pro Rata share of all Revolver Loans and LC
Obligations then outstanding, exceeds such Lender's Revolver Commitment;
provided, however, that if Issuing Bank shall have received written notice
from a Lender on or before the Business Day immediately prior to the date
of Issuing Bank's issuance of a Letter of Credit that one or more of the
conditions set forth in Section 11 or Section 2.3.1 has not been satisfied,
Issuing Bank shall have no obligation to issue the requested Letter of
Credit or any other Letter of Credit until such notice is withdrawn in
writing by that Lender or until the Required Lenders shall have effectively
waived such condition in accordance with this Agreement. In no event shall
Issuing Bank be deemed to have notice or knowledge of any existence of any
Default or Event of Default or the failure of any conditions in Sections 11
or 2.3.1 to be satisfied prior to its receipt of such notice from a Lender.
(ii) If Issuing Bank makes any payment under a Letter of Credit
and Borrowers do not repay or cause to be repaid the amount of such payment
on the Reimbursement Date, Issuing Bank shall promptly notify
Administrative Agent, which shall promptly notify each Participating
Lender, of such payment and each Participating Lender shall promptly (and
in any event within 1 Business Day after its receipt of notice from
Administrative Agent) and unconditionally pay to Administrative Agent, for
the account of Issuing Bank, in immediately available funds, the amount of
such Participating Lender's Pro Rata share of such payment, and
Administrative Agent shall promptly pay such amounts to Issuing Bank. If a
Participating Lender does not make its Pro Rata share of the amount of such
payment available to Administrative Agent on a timely basis as herein
provided, such Participating Lender agrees to pay to Administrative Agent
for the account of Issuing Bank, forthwith on demand, such amount together
with interest thereon at the Federal Funds Rate until paid. The failure of
any Participating Lender to make available to Administrative Agent for the
account of Issuing Bank such Participating Lender's Pro Rata share of the
LC Obligations shall not relieve any other Participating Lender of its
obligation hereunder to make available to Administrative Agent its Pro Rata
share of the LC Obligations. No Participating Lender shall be responsible
for the failure of any other Participating Lender to make available to
Administrative Agent its Pro Rata share of the LC Obligations on the date
such payment is to be made.
(iii) Whenever Issuing Bank receives a payment on account of the
LC Obligations, including any interest thereon, as to which Administrative
Agent has previously received payments from any Participating Lender for
the account of Issuing Bank, Issuing Bank shall promptly pay to each
Participating Lender which has funded its participating interest therein,
in immediately available funds, an amount equal to such Participating
Lender's Pro Rata share thereof.
(iv) The obligation of each Participating Lender to make payments
to Administrative Agent for the account of Issuing Bank in connection with
Issuing Bank's payment under a Letter of Credit shall be absolute,
unconditional and irrevocable, not subject to any counterclaim, setoff,
qualification or exception whatsoever, and shall be made in accordance with
the terms and conditions of this Agreement under all circumstances and
irrespective of whether or not Borrowers may assert or have any claim for
any lack of validity or unenforceability of this Agreement or any of the
other Loan Documents; the existence of any Default or Event of Default;
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any draft, certificate or other document presented under a Letter of Credit
having been determined to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect; the existence of any setoff or defense any Obligor may have with
respect to any of the Obligations; or the termination of the Commitments.
(v) Neither Issuing Bank nor any of its officers, directors,
employees or agents shall be liable to any Participating Lender for any
action taken or omitted to be taken under or in connection with any of the
LC Documents except as a result of actual gross negligence or willful
misconduct on the part of Issuing Bank. Issuing Bank does not assume any
responsibility for any failure or delay in performance or breach by a
Borrower or any other Person of its obligations under any of the LC
Documents. Issuing Bank does not make to Participating Lenders any express
or implied warranty, representation or guaranty with respect to the
Collateral, the LC Documents, or any Obligor. Issuing Bank shall not be
responsible to any Participating Lender for any recitals, statements,
information, representations or warranties contained in, or for the
execution, validity, genuineness, effectiveness or enforceability of or any
of the LC Documents; the validity, genuineness, enforceability,
collectibility, value or sufficiency of any of the Collateral or the
perfection of any Lien therein; or the assets, liabilities, financial
condition, results of operations, business, creditworthiness or legal
status of any Obligor or any Account Debtor. In connection with its
administration of and enforcement of rights or remedies under any of the LC
Documents, Issuing Bank shall be entitled to act, and shall be fully
protected in acting upon, any certification, notice or other communication
in whatever form believed by Issuing Bank, in good faith, to be genuine and
correct and to have been signed, sent or made by a proper Person. Issuing
Bank may consult with and employ legal counsel, accountants and other
experts and to advise it concerning its rights, powers and privileges under
the LC Documents and shall be entitled to act upon, and shall be fully
protected in any action taken in good faith reliance upon, any advice given
by such experts. Issuing Bank may employ agents and attorneys-in-fact in
connection with any matter relating to the LC Documents and shall not be
liable for the negligence, default or misconduct of any such agents or
attorneys-in-fact selected by Issuing Bank with reasonable care. Issuing
Bank shall not have any liability to any Participating Lender by reason of
Issuing Bank's refraining to take any action under any of the LC Documents
without having first received written instructions from the Required
Lenders to take such action.
(vi) Upon the request of any Participating Lender, Issuing Bank
shall furnish to such Participating Lender copies (to the extent then
available to Issuing Bank) of each outstanding Letter of Credit and related
LC Documents as may be in the possession of Issuing Bank and reasonably
requested from time to time by such Participating Lender.
2.3.3. Cash Collateral Account. If any LC Obligations, whether or not
then due or payable, shall for any reason be outstanding (i) at any time that an
Event of Default exists, (ii) on any date that Availability is less than zero or
(iii) on or at any time after the Commitment Termination Date, then Borrowers
shall, on Issuing Bank's or Administrative Agent's request, forthwith pay to
Issuing Bank the amount of any LC Obligations that are then due and payable and
shall, upon the occurrence of any of the events described in clauses (i) and
(iii) hereinabove, Cash Collateralize all outstanding Letters of Credit or
deliver to Administrative Agent a Supporting LC in a face amount equal to 104%
of the aggregate Undrawn Amounts of such Letters of Credit. If notwithstanding
the occurrence of one or more of the events described in clauses (i) and (iii)
in the immediately preceding sentence Borrowers fail to Cash Collateralize, or
provide a Supporting LC as provided hereinabove with respect to, any outstanding
Letters of Credit on the first Business Day following Administrative Agent's or
Issuing Bank's demand therefor, Lenders may (and shall upon direction of
Administrative Agent) advance such amount as Revolver Loans (whether or not the
Commitment Termination Date has occurred or an Out-of-Formula Condition is
created thereby). Such cash (together with any interest accrued thereon) shall
be held by
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Administrative Agent in the Cash Collateral Account and may be invested, in
Administrative Agent's discretion, in Cash Equivalents. Each Borrower hereby
pledges to Administrative Agent and grants to Administrative Agent a security
interest in, for the benefit of Administrative Agent in such capacity and for
the Pro Rata Benefit of Lenders, all Cash Collateral held in the Cash Collateral
Account from time to time and all proceeds thereof, as security for the payment
of all Obligations (including LC Obligations), whether or not then due or
payable. From time to time after cash is deposited in the Cash Collateral
Account, Administrative Agent may apply Cash Collateral then held in the Cash
Collateral Account to the payment of any amounts, in such order as
Administrative Agent may elect, as shall be or shall become due and payable by
Borrowers to Issuing Bank, Administrative Agent or any Lender with respect to
the LC Obligations. Neither Borrowers nor any other Person claiming by, through
or under or on behalf of Borrowers shall have any right to withdraw any of the
Cash Collateral held in the Cash Collateral Account, including any accrued
interest, provided that upon termination or expiration of all Letters of Credit
and the payment and satisfaction of all of the LC Obligations, any Cash
Collateral remaining in the Cash Collateral Account (plus accrued interest
thereon, if any)shall be returned to Borrowers unless an Event of Default then
exists (in which event Administrative Agent may apply such Cash Collateral to
the payment of any other Obligations outstanding and, to the extent so applied,
such Cash Collateral shall be applied in accordance with the provisions of
SECTION 5.6, with any surplus to be turned over to Borrowers).
2.3.4. Indemnifications
(i) In addition to and without limiting any other indemnity which
Borrowers may have to any Indemnitees under any of the Loan Documents, each
Borrower hereby agrees to indemnify and defend each of the Indemnitees and
to hold each of the Indemnitees harmless from and against any and all
Claims which any Indemnitee may suffer, incur or be subject to as a
consequence, directly or indirectly, of (a) the issuance of, payment or
failure to pay or any performance or failure to perform under any Letter of
Credit, (b) any suit, investigation or proceeding as to which
Administrative Agent or any Lender is or may become a party to as a
consequence, directly or indirectly, of the issuance of any Letter of
Credit or the payment or failure to pay thereunder or (c) Issuing Bank
following any instructions of a Borrower with respect to any Letter of
Credit or any Document received by Issuing Bank with reference to any
Letter of Credit. The foregoing indemnity obligations of Borrowers are
subject to the provisions of SECTION 15.3 hereof.
(ii) Each Participating Lender agrees to indemnify and defend
each of the Issuing Bank Indemnitees (to the extent the Issuing Bank
Indemnitees are not reimbursed by Borrowers or any other Obligor, but
without limiting the indemnification obligations of Borrowers under this
Agreement), to the extent of such Lender's Pro Rata share of the Revolver
Commitments, from and against any and all Claims which may be imposed on,
incurred by or asserted against any of the Issuing Bank Indemnitees in any
way related to or arising out of Issuing Bank's administration or
enforcement of rights or remedies under any of the LC Documents or any of
the transactions contemplated thereby (including costs and expenses which
Borrowers are obligated to pay under SECTION 15.2).
2.4. BANK PRODUCTS. Borrowers may request BofA to provide, or to arrange
for one or more of its Affiliates to provide, Bank Products, but BofA shall have
no obligation whatsoever to provide, or to arrange for the provision of, any
Bank Products. If Bank Products are provided by an Affiliate of BofA under any
of the Loan Documents, Borrowers agree to indemnify and hold Administrative
Agent, BofA and Lenders harmless from and against any and all Claims at any time
incurred by Administrative Agent, BofA or any Lenders that arise from any
indemnity given to such Affiliates that relate to such Bank Products. Borrowers
acknowledge that obtaining Bank Products from BofA or BofA's Affiliates
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hereunder is in the discretion of BofA or BofA's Affiliates and is subject to
all rules and regulations of BofA or BofA's Affiliates that are applicable to
such Bank Products.
SECTION 3. INTEREST, FEES AND CHARGES
3.1. INTEREST.
3.1.1. Rates of Interest. Borrowers agree to pay interest in respect
of all unpaid principal amounts of the Revolver Loans from the respective dates
such principal amounts are advanced until paid (whether at stated maturity, on
acceleration or otherwise) at a rate per annum equal to the applicable rate
indicated below:
(i) for Revolver Loans made or outstanding as Base Rate Loans,
the Applicable Margin plus the Base Rate in effect from time to time; or
(ii) for Revolver Loans made or outstanding as LIBOR Loans, the
Applicable Margin plus the Adjusted LIBOR Rate for the applicable Interest
Period selected by Borrowers in conformity with this Agreement.
Upon determining the Adjusted LIBOR Rate for any Interest Period
requested by Borrowers, Administrative Agent shall promptly notify Borrowers
thereof by telephone and, if so requested by Borrowers, confirm the same in
writing. Such determination shall, absent manifest error, be final, conclusive
and binding on all parties and for all purposes. The applicable rate of interest
for all Loans (or portions thereof) bearing interest based upon the Base Rate
shall be increased or decreased, as the case may be, by an amount equal to any
increase or decrease in the Base Rate, with such adjustments to be effective as
of the opening of business on the day that any such change in the Base Rate
becomes effective. Interest on each Loan shall accrue from and including the
date on which such Loan is made, converted to a Loan of another Type or
continued as a LIBOR Loan to (but excluding) the date of any repayment thereof;
provided, however, that, if a Loan is repaid on the same day made, one day's
interest shall be paid on such Loan.
3.1.2. Conversions and Continuations.
(i) Borrowers may on any Business Day, subject to the giving of a
proper Notice of Conversion/Continuation as hereinafter described, elect
(A) to continue all or any part of a LIBOR Loan by selecting a new Interest
Period therefor, to commence on the last day of the immediately preceding
Interest Period, or (B) to convert all or any part of a Loan of one Type
into a Loan of another Type; provided, however, during the period that any
Event of Default exists, Administrative Agent may (and shall at the
direction of the Required Lenders) declare that no Loan may be made or
continued as or converted into a LIBOR Loan. Any conversion of a LIBOR Loan
into a Base Rate Loan shall be made on the last day of the Interest Period
for such LIBOR Loan. Any conversion or continuation made with respect to
less than the entire outstanding balance of the Loans must be allocated
among Lenders on a Pro Rata basis and the Interest Period for Loans
converted into or continued as LIBOR Loans shall be coterminous for each
Lender.
(ii) Whenever Borrowers desire to convert or continue Loans under
SECTION 3.1.2(I), Borrower Agent shall give Administrative Agent written
notice (or telephonic notice promptly confirmed in writing) substantially
in the form of EXHIBIT C (a "Notice of Conversion/Continuation"), signed by
an authorized officer of Borrower Agent, at least 1 Business Day before the
requested conversion date, in the case of a conversion into Base Rate
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Loans, and at least 3 Business Days before the requested conversion or
continuation date, in the case of a conversion into or continuation of
LIBOR Loans. Promptly after receipt of a Notice of Conversion/Continuation,
Administrative Agent shall notify each Lender in writing of the proposed
conversion or continuation. Each such Notice of Conversion/Continuation
shall be irrevocable and shall specify the aggregate principal amount of
the Loans to be converted or continued, the date of such conversion or
continuation (which shall be a Business Day) and whether the Loans are
being converted into or continued as LIBOR Loans (and, if so, the duration
of the Interest Period to be applicable thereto and, in the absence of any
specification by Borrowers of the Interest Period, an Interest Period of
one month will be deemed to be specified) or Base Rate Loans. If, upon the
expiration of any Interest Period in respect of any LIBOR Loans, Borrowers
shall have failed to deliver the Notice of Conversion/Continuation,
Borrowers shall be deemed to have elected to convert such LIBOR Loans to
Base Rate Loans.
3.1.3. Interest Periods. In connection with the making or continuation
of, or conversion into, each Borrowing of LIBOR Loans, Borrowers shall select an
interest period (each an "Interest Period") to be applicable to such LIBOR Loan,
which interest period shall commence on the date such LIBOR Loan is made and
shall end on a numerically corresponding day in the first, second, third or
sixth month thereafter; provided, however, that:
(i) the initial Interest Period for a LIBOR Loan shall commence
on the date of such Borrowing (including the date of any conversion from a
Loan of another Type) and each Interest Period occurring thereafter in
respect of such Revolver Loan shall commence on the date on which the next
preceding Interest Period expires;
(ii) if any Interest Period would otherwise expire on a day that
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that, if any Interest Period in respect
of LIBOR Loans would otherwise expire on a day that is not a Business Day
but is a day of the month after which no further Business Day occurs in
such month, such Interest Period shall expire on the immediately preceding
Business Day;
(iii) any Interest Period that begins on a day for which there is
no numerically corresponding day in the calendar month at the end of such
Interest Period shall expire on the last Business Day of such calendar
month; and
(iv) no Interest Period shall extend beyond the last day of the
Term.
3.1.4. Interest Rate Not Ascertainable. If Administrative Agent shall
determine (which determination shall, absent manifest error, be final,
conclusive and binding upon all parties) that on any date for determining the
Adjusted LIBOR Rate for any Interest Period, by reason of any changes arising
after the date of this Agreement affecting the London interbank market or any
Lender's position in such market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in the
definition of Adjusted LIBOR Rate, then, and in any such event, Administrative
Agent shall forthwith give notice (by telephone promptly confirmed in writing)
to Borrowers of such determination. Until Administrative Agent notifies
Borrowers that the circumstances giving rise to the suspension described herein
no longer exist (which Administrative Agent agrees to do promptly after such
circumstance no longer exists, the obligation of Lenders to make LIBOR Loans
shall be suspended, and such affected Loans then outstanding shall, at the end
of the then applicable Interest Period or at such earlier time as may be
required by Applicable Law, bear the same interest as Base Rate Loans.
3.1.5. Default Rate of Interest. Borrowers shall pay interest at a
rate per annum equal to the Default Rate (i) with respect to any portion of the
principal amount of the Obligations (and, to the
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extent permitted by Applicable Law, all past due interest) that is not paid on
the due date thereof (whether due at stated maturity, on demand, upon
acceleration or otherwise) until Full Payment thereof; (ii) with respect to the
principal amount of all of the Obligations (and, to the extent permitted by
Applicable Law, all past due interest) upon the earlier to occur of (x) Borrower
Agent's receipt of notice from Administrative Agent of the Required Lenders'
election to charge the Default Rate based upon the existence of any Event of
Default under SECTION 10.3 (which notice Administrative Agent shall send only
with the consent or at the direction of the Required Lenders), whether or not
acceleration or demand for payment of the Obligations has been made, or (y) the
commencement by or against any Borrower of an Insolvency Proceeding whether or
not under the circumstances described in clauses (i) or (ii) hereof Lenders
elect to accelerate the maturity or demand payment of any of the Obligations;
and (iii) with respect to the principal amount of any Out-of-Formula Loans
(unless otherwise agreed in writing by the Required Lenders), whether or not
demand for payment thereof has been made by Administrative Agent. To the fullest
extent permitted by Applicable Law, the Default Rate shall apply and accrue on
any judgment entered with respect to any of the Obligations and to the unpaid
principal amount of the Obligations during any Insolvency Proceeding of a
Borrower. Each Borrower acknowledges that the cost and expense to Administrative
Agent and each Lender attendant upon the occurrence of an Event of Default are
difficult to ascertain or estimate and that the Default Rate is a fair and
reasonable estimate to compensate Administrative Agent and Lenders for such
added cost and expense. Interest accrued at the Default Rate shall be due and
payable ON DEMAND.
3.2. FEES. In consideration of Lenders' establishment of the Commitments in
favor of Borrowers, and Administrative Agent's agreement to serve as collateral
and administrative agent hereunder, Borrowers jointly and severally agree to pay
the following fees:
3.2.1. Closing Fee. Borrowers shall be jointly and severally obligated
to pay to Administrative Agent, for the Pro Rata Benefit of the Initial Lender,
a closing fee in the amount set forth in the Fee Letter, which shall be paid on
the Restatement Effective Date.
3.2.2. Unused Line Fee. Borrowers shall be jointly and severally
obligated to pay to Administrative Agent for the Pro Rata benefit of Lenders a
fee (the "Unused Line Fee") equal to the Applicable Margin for the Unused Line
Fee divided by 360 days and multiplied by the number of days in the Fiscal
Quarter and then multiplied by the amount by which the Average Revolver Loan
Balance for any Fiscal Quarter (or portion thereof that the Commitments are in
effect) is less than the aggregate amount of the Revolver Commitments, such fee
to be paid quarterly, in arrears, on the first day of each Fiscal Quarter; but
if the Commitments are terminated on a day other than the first day of a Fiscal
Quarter, then any such Unused Line Fee payable for the Fiscal Quarter in which
termination shall occur shall be paid on the effective date of such termination.
3.2.3. LC Facility Fees. Borrowers shall be jointly and severally
obligated to pay: (a)(i) to Administrative Agent for the Pro Rata account of
each Lender for all Letters of Credit, the Applicable Margin in effect for
Revolver Loans that are LIBOR Loans on a per annum basis based on the average
amount available to be drawn under Letters of Credit outstanding and all Letters
of Credit that are paid or expire during the period of measurement, payable
monthly, in arrears, on the first Business Day of the following month; (ii) to
Issuing Bank for its own account a Letter of Credit fronting fee of .125% per
annum based upon the face amount of each Letter of Credit issued during the
period of measurement, payable monthly, in arrears, on the first Business Day of
the following month; and (iii) to Issuing Bank for its own account all customary
charges associated with the issuance, amending, negotiating, payment, processing
and administration of all Letters of Credit. All Letter of Credit fees that are
expressed as a percentage shall be increased to a percentage that is 2% greater
than the percentage that would otherwise be applicable to Revolver Loans when
the Default Rate is in effect.
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3.2.4. Audit and Appraisal Fees and Expenses. Borrowers shall
reimburse Administrative Agent for all reasonable out-of-pocket costs and
expenses incurred by Administrative Agent in connection with examinations and
reviews of any Obligor's books and records up to 2 times per Loan Year unless an
Event of Default exists (in which event, there shall be no limit on the number
of examinations and reviews for which Borrowers shall be obligated to reimburse
Administrative Agent) and, in each case, shall pay to Administrative Agent the
standard amount charged by Administrative Agent per day ($850 per day as of the
Restatement Effective Date) for each day that an employee or agent of
Administrative Agent shall be engaged in an examination or review of any
Obligor's books and records. The foregoing shall not be construed to limit
Administrative Agent's right to conduct audits as provided in SECTION 10.1.1.
3.2.5. Agency Fee. In consideration of BofA's service as
Administrative Agent hereunder, Borrowers shall be jointly and severally
obligated to pay to Administrative Agent, an agency fee in the amount set forth
in the Fee Letter, which shall be paid on the Restatement Effective Date and
thereafter on each anniversary of the Restatement Effective Date.
3.2.6. General Provisions. All fees shall be fully earned by the
identified recipient thereof pursuant to the foregoing provisions of this
Agreement on the due date thereof (and, in the case of Letters of Credit, upon
each issuance, renewal or extension of such Letter of Credit) and, except as
otherwise set forth herein or required by Applicable Law, shall not be subject
to rebate, refund or proration. All fees provided for in SECTION 3.2 are and
shall be deemed to be compensation for services and are not, and shall not be
deemed to be, interest or any other charge for the use, forbearance or detention
of money.
3.3. COMPUTATION OF INTEREST AND FEES. All fees and other charges provided
for in this Agreement that are calculated as a per annum percentage of any
amount and all interest shall be calculated daily and shall be computed on the
actual number of days elapsed over a year of 360 days. For purposes of computing
interest and other charges hereunder, each Payment Item and other form of
payment received by Administrative Agent (with the date of such receipt to be
governed by SECTION 5.7) shall be deemed applied by Administrative Agent and
Lenders on account of the Obligations (subject to final payment of such items)
on the Business Day on which Administrative Agent receives collected funds in
the Payment Account, and Administrative Agent shall be deemed to have received
such Payment Item on the date specified in SECTION 5.7. Each determination by
Administrative Agent of interest and fees hereunder shall be presumptive
evidence of the correctness of such interest and fees.
3.4. REIMBURSEMENT OBLIGATIONS.
3.4.1. Borrowers shall reimburse Administrative Agent and Lenders for
any Extraordinary Expenses incurred by Administrative Agent or any Lender, on
the sooner to occur of Administrative Agent's demand therefor or Administrative
Agent's receipt of any proceeds of Collateral in connection with any Enforcement
Action (subject to the provisions of SECTION 5.6 with respect to the application
of any proceeds of Collateral). Borrowers shall also reimburse Administrative
Agent for all legal, accounting, appraisal, consulting and other fees and
expenses suffered or incurred by Administrative Agent in connection with: (i)
the negotiation and preparation (and internal legal review) of any of the Loan
Documents, any amendment or modification thereto; (ii) the administration of the
Loan Documents and the transactions contemplated thereby; (iii) action taken to
perfect or maintain the perfection or priority of any of Administrative Agent's
Liens with respect to any of the Collateral; (iv) any inspection of or audits
conducted by Administrative Agent with respect to any Obligor's books and
records in accordance with SECTION 3.2.4; (v) any effort by Administrative Agent
to verify or appraise any of the Collateral. All amounts chargeable to or
reimbursable by Borrowers under this SECTION 3.4 shall constitute Obligations
that are secured by all of the Collateral and shall be payable ON DEMAND to
Administrative Agent. Borrowers shall also reimburse
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Administrative Agent for reasonable out-of-pocket expenses incurred by
Administrative Agent in its administration of any of the Collateral to the
extent and in the manner provided in SECTION 8 or in any of the other Loan
Documents. The foregoing shall be in addition to, and shall not be construed to
limit, any other provision of any of the Loan Documents regarding the
indemnification or reimbursement by Borrowers of Claims suffered or incurred by
Administrative Agent or any Lender.
3.4.2. If at any time Lender shall agree to indemnify any Person
against losses or damages that such Person may suffer or incur in its dealings
or transactions with Borrowers, or shall guarantee or otherwise assure payment
of any liability or obligation of Borrowers to such Person, or otherwise shall
provide assurances of Borrowers' payment or performance under any agreement with
such Person, including indemnities, guaranties or other assurances of payment or
performance given by Lender with respect to Banking Relationship Debt, then the
Contingent Obligation of Lender providing any such indemnity, guaranty or other
assurance of payment or performance, together with any payment made or liability
incurred by Lender in connection therewith, shall constitute Obligations that
are secured by the Collateral and Borrowers shall repay, on demand, any amount
so paid or any liability incurred by Lender in connection with any such
indemnity, guaranty, or assurance. Nothing herein shall be construed to impose
upon Lender any obligation to provide any such indemnity, guaranty or assurance.
The foregoing agreement of Borrowers shall apply whether or not such indemnity,
guaranty or assurance is in writing or oral, provided that Administrative Agent
provides Borrower's with notice of the existence thereof, shall survive
termination of the Commitment and Full Payment of the Obligations and any other
provisions of the Loan Documents regarding reimbursement or indemnification by
Borrowers of Claims suffered or incurred by Lender.
3.5. BANK CHARGES. Borrowers shall pay to Administrative Agent, ON DEMAND,
any and all fees, costs or expenses which Administrative Agent pays to a bank or
other similar institution (including any fees paid by Administrative Agent or
any Lender to any Participant) arising out of or in connection with (i) the
forwarding to a Borrower or any other Person on behalf of Borrower by
Administrative Agent of proceeds of Loans made by Lenders to a Borrower pursuant
to this Agreement and (ii) the depositing for collection by Administrative Agent
of any Payment Item received or delivered to Administrative Agent on account of
the Obligations. Each Borrower acknowledges and agrees that Administrative Agent
may charge such costs, fees and expenses to Borrowers based upon Administrative
Agent's good faith estimate of such costs, fees and expenses as they are
incurred by Administrative Agent.
3.6. ILLEGALITY. Notwithstanding anything to the contrary contained
elsewhere in this Agreement, if (i) any change after the date hereof in any law
or regulation or in the interpretation thereof by any Governmental Authority
charged with the administration thereof shall make it unlawful for a Lender to
make or maintain a LIBOR Loan or to give effect to its obligations as
contemplated hereby with respect to a LIBOR Loan or (ii) at any time such Lender
determines that the making or continuance of any LIBOR Loan has become
impracticable as a result of a contingency occurring after the date hereof which
adversely affects the London interbank market or the position of such Lender in
such market, then such Lender shall give after such determination Administrative
Agent and Borrowers notice thereof and may thereafter (1) declare that LIBOR
Loans will not thereafter be made by such Lender, whereupon any request by a
Borrower for a LIBOR Loan from such Lender shall be deemed a request for a Base
Rate Loan unless such Lender's declaration shall be subsequently withdrawn
(which declaration shall be withdrawn promptly after the cessation of the
circumstances described in clause (i) or (ii) above); and (2) require that all
outstanding LIBOR Loans made by such Lender be converted to Base Rate Loans,
under the circumstances of clause (i) or (ii) of this SECTION 3.6 insofar as
such Lender determines the continuance of LIBOR Loans to be impracticable, in
which event all such LIBOR Loans of such Lender shall be converted automatically
to Base Rate Loans as of the date of any Borrower's receipt of the aforesaid
notice from such Lender.
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3.7. INCREASED COSTS. If, by reason of (a) the introduction after the date
hereof or any change after the date hereof (including any change by way of
imposition or increase of Statutory Reserves or other reserve requirements) in
or in the interpretation of any law or regulation, or (b) the compliance after
the date hereof with any guideline or request from any central bank or other
Governmental Authority or quasi-Governmental Authority exercising control over
banks or financial institutions generally (whether or not having the force of
law):
(i) any Lender shall be subject after the date hereof to any Tax,
duty or other charge with respect to any LIBOR Loan or Letter of Credit or
its obligation to make LIBOR Loans or to issue Letters of Credit or to
participate in the LC Obligations arising from the issuance of Letters of
Credit, or a change shall result in the basis of taxation of payment to
Lender of the principal of or interest on its LIBOR Loans or its obligation
to make LIBOR Loan, issue Letters of Credit or participate in the LC
Obligations arising from the issuance of Letters of Credit (except for
Excluded Taxes); or
(ii) any reserve (including any imposed by the Board of
Governors), special deposits or similar requirement against assets of,
deposits with or for the account of, or credit extended by, any Lender
shall be imposed or deemed applicable or any other condition affecting its
LIBOR Loans or Letters of Credit or its obligation to make LIBOR Loans or
to issue Letters of Credit or participate in the LC Obligations arising
form the issuance of Letters of Credit shall be imposed on such Lender or
the London interbank market;
and as a result thereof there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining LIBOR Loans or issuing
Letters of Credit (except to the extent already included in the determination of
the applicable Adjusted LIBOR Rate for LIBOR Loans), or there shall be a
reduction in the amount received or receivable by such Lender, then such Lender
shall, promptly after determining the existence or amount of any such increased
costs for which such Lender seeks payment hereunder, give any Borrower notice
thereof and Borrowers shall from time to time, upon written notice from and
demand by such Lender (with a copy of such notice and demand to Administrative
Agent), pay to Administrative Agent for the account of such Lender, within 5
Business Days after the date specified in such notice and demand, an additional
amount sufficient to indemnify such Lender against such increased costs. A
certificate as to the amount of such increased costs (and setting forth the
calculation thereof in reasonable detail), submitted to Borrowers by such
Lender, shall be final, conclusive and binding for all purposes, absent manifest
error.
If any Lender shall advise Administrative Agent at any time that, because
of the circumstances described hereinabove in this SECTION 3.7 or any other
circumstances arising after the date of this Agreement affecting such Lender or
the London interbank market or such Lender's position in such market, the
Adjusted LIBOR Rate, as determined by Administrative Agent, will not adequately
and fairly reflect the cost to such Lender of funding LIBOR Loans or issuing
Letters of Credit, then, and in any such event:
(i) Administrative Agent shall forthwith give notice (by
telephone confirmed promptly in writing) to Borrowers and Lenders of such
event;
(ii) Borrowers' right to request and such Lender's obligation to
make LIBOR Loans or to issue Letters of Credit or participate in the LC
Obligations arising from the issuance of Letters of Credit shall be
immediately suspended and Borrowers' right to continue a LIBOR Loan as such
beyond the then applicable Interest Period or to request a Letter of Credit
shall also be suspended, until each condition giving rise to such
suspension no longer exists; and
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(iii) such Lender shall make a Base Rate Loan as part of the
requested Borrowing of LIBOR Loans, which Base Rate Loan shall, for all
purposes, be considered part of such Borrowing.
For purposes of this SECTION 3.7, all references to a Lender shall be
deemed to include any bank holding company or bank parent of such Lender. If any
Lender provides notice that, due to the circumstances described in this SECTION
3.7, the Adjusted LIBOR Rate will not adequately and fairly reflect the cost to
such Lender of funding LIBOR Loans or participating in the LC Obligations
arising from the issuance of Letters of Credit, then such Lender may be replaced
pursuant to the provisions of SECTION 13.17.
3.8. CAPITAL ADEQUACY. If any Lender determines that (i) the introduction
after the date hereof of any Capital Adequacy Regulation, (ii) any change after
the date hereof in any Capital Adequacy Regulation, (iii) any change in the
interpretation or administration of any Capital Adequacy Regulation by any
central bank or other Governmental Authority charged with the interpretation or
administration thereof, or (iv) compliance after the date hereof by such Lender
or any corporation or other entity controlling such Lender with any Capital
Adequacy Regulation, affects the amount of capital required or expected to be
maintained by such Lender or any Person controlling such Lender and (taking into
consideration such Lender's or such corporation's or other entity's policies
with respect to capital adequacy and such Lender's desired return on capital)
determines that the amount of such capital is increased as a consequence of its
Commitments, loans, credits or obligations under this Agreement, then: (a)
Administrative Agent shall promptly, after its receipt of a certificate from
such Lender setting forth such Lender's determination of such occurrence, give
notice thereof to Borrowers and Lenders; and (b) Borrowers shall pay to
Administrative Agent, for the account of such Lender, as an additional fee from
time to time, ON DEMAND, such amount as such Lender certifies to be the amount
reasonably calculated to compensate such Lender for such reduction. A
certificate of such Lender claiming entitlement to compensation as set forth
above will be conclusive in the absence of manifest error. Such certificate will
set forth the nature of the occurrence giving rise to such compensation, the
additional amount or amounts to be paid to such Lender (including the basis for
Lender's determination of such amount), and the method by which such amounts
were determined. In determining such amount, such Lender may use any reasonable
averaging and attribution method. For purposes of this SECTION 3.8 all
references to a Lender shall be deemed to include any bank holding company or
bank parent of such Lender.
3.9. MITIGATION. Each Lender agrees that, with reasonable promptness after
such Lender becomes aware that such Lender is entitled to receive payments under
SECTIONS 3.6, 3.7 OR 3.8, or is or has become subject to U.S. withholding taxes
payable by any Borrower in respect of its Loans, it will, to the extent not
inconsistent with any internal policy of such Lender or any applicable legal or
regulatory restriction, (i) use all reasonable efforts to make, fund or maintain
the Commitment of such Lender or the Loans of such Lender through another
lending office of such Lender or (ii) take such other reasonable measures, if,
as a result thereof, the circumstances which would relieve Borrowers from their
obligations to pay such additional amounts (or reduce the amount of such
payments), or such withholding taxes would be reduced, and if the making,
funding or maintaining of such Commitment or Loans through such other lending
office or in accordance with such other measures, as the case may be, would not
otherwise adversely affect such Commitment or Loans or the interests of such
Lender.
3.10. FUNDING LOSSES. If for any reason (other than due to a default by
Lender or as a result of a Lender's refusal to honor a LIBOR Loan request due to
circumstances described in this Agreement) a Borrowing of, or conversion to or
continuation of, LIBOR Loans does not occur on the date specified therefor in a
Notice of Borrowing or Notice of Conversion/Continuation (whether or not
withdrawn), or if any repayment (including any conversions pursuant to SECTION
3.1.2) of any of its LIBOR Loans occurs
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on a date that is not the last day of an Interest Period applicable thereto, or
if for any reason Borrowers default in their obligation to repay LIBOR Loans
when required by the terms of this Agreement, then Borrowers shall be jointly
and severally obligated to pay to Administrative Agent an administrative fee of
$150 and to each Lender an amount equal to all losses and expenses (other than
loss of profit) which such Lender may sustain or incur as a consequence thereof,
including any such loss or expense arising from the liquidation or redeployment
of funds obtained by it to maintain its LIBOR Loans or from fees payable to
terminate the deposits from which such funds were obtained. Borrowers shall pay
all such amounts due to any Lender upon presentation by such Lender of a
statement setting forth the amount and such Lender's calculation thereof, which
statement shall be deemed true and correct absent manifest error. For purposes
of this SECTION 3.10, all references to a Lender shall be deemed to include any
bank holding company or bank parent of such Lender.
3.11. MAXIMUM INTEREST. Regardless of any provision contained in any of the
Loan Documents, in no contingency or event whatsoever shall the aggregate of all
amounts that are contracted for, charged or received by Administrative Agent and
Lenders pursuant to the terms of this Agreement or any of the other Loan
Documents and that are deemed interest under Applicable Law exceed the highest
rate permissible under any Applicable Law. No agreements, conditions, provisions
or stipulations contained in this Agreement or any of the other Loan Documents
or the exercise by Administrative Agent of the right to accelerate the payment
or the maturity of all or any portion of the Obligations, or the exercise of any
option whatsoever contained in any of the Loan Documents, or the prepayment by
Borrowers of any of the Obligations, or the occurrence of any contingency
whatsoever, shall entitle Administrative Agent or any Lender to charge or
receive in any event, interest or any charges, amounts, premiums or fees deemed
interest by Applicable Law (such interest, charges, amounts, premiums and fees
referred to herein collectively as "Interest") in excess of the Maximum Rate,
and in no event shall Borrowers be obligated to pay Interest exceeding such
Maximum Rate, and all agreements, conditions or stipulations, if any, which may
in any event or contingency whatsoever operate to bind, obligate or compel
Borrowers to pay Interest exceeding the Maximum Rate shall be without binding
force or effect, at law or in equity, to the extent only of the excess of
Interest over such Maximum Rate. If any Interest is charged or received with
respect to the Obligations in excess of the Maximum Rate ("Excess"), Borrowers
stipulate that any such charge or receipt shall be the result of an accident and
bona fide error, and such Excess, to the extent received, shall be applied first
to reduce the principal of such Obligations and the balance, if any, returned to
Borrowers, it being the intent of the parties hereto not to enter into a
usurious or otherwise illegal relationship. Each Borrower recognizes that, with
fluctuations in the rates of interest set forth in SECTION 3.1.1, and the
Maximum Rate, such an unintentional result could inadvertently occur. All monies
paid to Administrative Agent or any Lender hereunder or under any of the other
Loan Documents, whether at maturity or by prepayment, shall be subject to any
rebate of unearned Interest as and to the extent required by Applicable Law. By
the execution of this Agreement, each Borrower covenants that (i) the credit or
return of any Excess shall constitute the acceptance by such Borrower of such
Excess, and (ii) such Borrower shall not seek or pursue any other remedy, legal
or equitable, against Administrative Agent or any Lender, based in whole or in
part upon contracting for, charging or receiving any Interest in excess of the
Maximum Rate. For the purpose of determining whether or not any Excess has been
contracted for, charged or received by Administrative Agent or any Lender, all
Interest at any time contracted for, charged or received from Borrowers in
connection with any of the Loan Documents shall, to the extent permitted by
Applicable Law, be amortized, prorated, allocated and spread in equal parts
throughout the full term of the Obligations. Borrowers, Administrative Agent and
Lenders shall, to the maximum extent permitted under Applicable Law, (i)
characterize any non-principal payment as an expense, fee or premium rather than
as Interest and (ii) exclude voluntary prepayments and the effects thereof. The
provisions of this SECTION 3.11 shall be deemed to be incorporated into every
Loan Document (whether or not any provision of this Section is referred to
therein). All such Loan Documents and communications relating to any Interest
owed by Borrowers and all figures set forth therein shall, for the sole purpose
of computing the extent of
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Obligations, be automatically recomputed by Borrowers, and by any court
considering the same, to give effect to the adjustments or credits required by
this SECTION 3.11.
SECTION 4. LOAN ADMINISTRATION
4.1. MANNER OF BORROWING AND FUNDING REVOLVER LOANS. Borrowings under the
Commitments established pursuant TO SECTION 2.1 shall be made and funded as
follows:
4.1.1. Notice of Borrowing.
(i) Whenever Borrowers desire to make a Borrowing under SECTION
2.1 (other than a Borrowing resulting from a conversion or continuation
pursuant to SECTION 3.1.2), Borrowers shall give Administrative Agent prior
written notice (or telephonic notice promptly confirmed in writing) of such
Borrowing request (a "Notice of Borrowing"), which shall be in the form of
EXHIBIT D annexed hereto and signed by an authorized officer of Borrower
Agent. Such Notice of Borrowing shall be given by Borrower Agent no later
than 2:00 p.m. at the office designated by Administrative Agent from time
to time (a) on the Business Day of the requested funding date of such
Borrowing, in the case of Base Rate Loans, and (b) at least 2 Business Days
prior to the requested funding date of such Borrowing, in the case of LIBOR
Loans. Notices received after 2:00 p.m. shall be deemed received on the
next Business Day. Any Revolver Loans made by each Lender on the
Restatement Effective Date shall be made as Base Rate Loans and thereafter
may be made or continued as or converted into Base Rate Loans or LIBOR
Loans. Each Notice of Borrowing (or telephonic notice thereof) shall be
irrevocable and shall specify (a) the principal amount of the Borrowing,
(b) the date of Borrowing (which shall be a Business Day), (c) whether the
Borrowing is to consist of Base Rate Loans or LIBOR Loans, (d) in the case
of LIBOR Loans, the duration of the Interest Period to be applicable
thereto, and (e) the account of Borrowers to which the proceeds of such
Borrowing are to be disbursed.
(ii) Unless payment is otherwise timely made by Borrowers, the
becoming due of any amount required to be paid with respect to any of the
Obligations (whether as principal, accrued interest, fees or other charges,
including Extraordinary Expenses and LC Obligations, and any amounts owed
to BofA or any Affiliate of BofA for Banking Relationship Debt) shall be
deemed irrevocably to be a request (without any requirement for the
submission of a Notice of Borrowing) for Revolver Loans on the due date of,
and in an aggregate amount required to pay, such Obligations, and the
proceeds of such Revolver Loans may be disbursed by way of direct payment
of the relevant Obligation and shall bear interest as Base Rate Loans.
(iii) If Borrowers elect to establish a Controlled Disbursement
Account with BofA or any Affiliate of BofA, then the presentation for
payment by BofA of any check or other item of payment drawn on the
Controlled Disbursement Account at a time when there are insufficient funds
in such account to cover such check shall be deemed irrevocably to be a
request (without any requirement for the submission of a Notice of
Borrowing) for Revolver Loans on the date of such presentation and in an
amount equal to the aggregate amount of the items presented for payment,
and the proceeds of such Revolver Loans may be disbursed to the Controlled
Disbursement Account and shall bear interest as Base Rate Loans.
(iv) Neither Administrative Agent nor any Lender shall have any
obligation to honor any deemed request for a Revolver Loan on or after the
Commitment Termination Date or when an Out-of-Formula Condition exists or
would result therefrom or when any condition precedent in SECTION 11 is not
satisfied, but may do so in the discretion of Administrative Agent (or at
the direction of the Required Lenders) and without regard to the existence
of, and without
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being deemed to have waived, any Default or Event of Default and regardless
of whether such Revolver Loan is funded after the Commitment Termination
Date.
4.1.2. Fundings by Lenders. Subject to its receipt of notice from
Administrative Agent of a Notice of Borrowing as provided in SECTION 4.1.1(I)
(except in the case of a deemed request by Borrower Agent for a Revolver Loan as
provided in SECTION 4.1.1(II) or (III) or SECTION 4.1.3(II), in which event no
Notice of Borrowing need be submitted), each Lender shall timely honor its
Revolver Commitment by funding its Pro Rata share of each Borrowing of Revolver
Loans that is properly requested and that Borrowers are entitled to receive
under the Loan Agreement. Administrative Agent shall endeavor to notify Lenders
of each Notice of Borrowing (or deemed request for a Borrowing pursuant to
SECTION 4.1.1(II) or (III)), by 2:00 p.m. on the proposed funding date (in the
case of Base Rate Loans) or by 2:00 p.m. at least 2 Business Days before the
proposed funding date (in the case of LIBOR Loans). Each Lender shall deposit
with Administrative Agent an amount equal to its Pro Rata share of the Borrowing
requested or deemed requested by Borrowers at Administrative Agent's designated
bank in immediately available funds not later than 2:00 p.m. on the date of
funding of such Borrowing, unless Administrative Agent's notice to Lenders is
received after 2:00 p.m. on the proposed funding date of a Base Rate Loan, in
which event Lenders shall deposit with Administrative Agent their respective Pro
Rata shares of the requested Borrowing on or before 11:00 a.m. of the next
Business Day. Subject to its receipt of such amounts from Lenders,
Administrative Agent shall make the proceeds of the Revolver Loans received by
it available to Borrowers by disbursing such proceeds in accordance with
Borrower Agent's disbursement instructions set forth in the applicable Notice of
Borrowing. Neither Administrative Agent nor any Lender shall have any liability
on account of any delay by any bank or other depository institution in treating
the proceeds of any Revolver Loan as collected funds or any delay in receipt, or
any loss, of funds that constitute a Revolver Loan, the wire transfer of which
was initiated by Administrative Agent in accordance with wiring instructions
provided to Administrative Agent. Unless Administrative Agent shall have been
notified in writing by a Lender prior to the proposed time of funding that such
Lender does not intend to deposit with Administrative Agent an amount equal to
such Lender's Pro Rata share of the requested Borrowing (or deemed request for a
Borrowing pursuant to clauses (ii) or (iii) of SECTION 4.1.1), Administrative
Agent may assume that such Lender has deposited or promptly will deposit its
share with Administrative Agent and Administrative Agent may in its discretion
disburse a corresponding amount to Borrowers on the applicable funding date. If
a Lender's Pro Rata share of such Borrowing is not in fact deposited with
Administrative Agent, then, if Administrative Agent has disbursed to Borrowers
an amount corresponding to such share, then such Lender agrees to pay, and in
addition Borrowers agree to repay, to Administrative Agent forthwith on demand
such corresponding amount, together with interest thereon, for each day from the
date such amount is disbursed by Administrative Agent to or for the benefit of
Borrowers until the date such amount is paid or repaid to Administrative Agent,
(a) in the case of Borrowers, at the interest rate applicable to such Borrowing
and (b) in the case of such Lender, at the Federal Funds Rate. If such Lender
repays to Administrative Agent such corresponding amount, such amount so repaid
shall constitute a Revolver Loan, and if both such Lender and Borrowers shall
have repaid such corresponding amount, Administrative Agent shall promptly
return to Borrowers such corresponding amount in same day funds. A notice from
Administrative Agent submitted to any Lender with respect to amounts owing under
this SECTION 4.1.2 shall be conclusive, absent manifest error.
4.1.3. Settlement and Swingline Loans.
(i) In order to facilitate the administration of the Revolver
Loans under this Agreement, Lenders and Administrative Agent agree (which
agreement shall be solely between Lenders and Administrative Agent and
shall not be for the benefit of or enforceable by any Borrower) that
settlement among them with respect to the Revolver Loans may take place on
a periodic basis on dates determined from time to time by Administrative
Agent (each a
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"Settlement Date"), which may occur before or after the occurrence or
during the continuance of a Default or Event of Default and whether or not
all of the conditions set forth in SECTION 11 have been met. On each
Settlement Date, payment shall be made by or to each Lender in the manner
provided herein and in accordance with the Settlement Report delivered by
Administrative Agent to Lenders with respect to such Settlement Date so
that, as of each Settlement Date and after giving effect to the transaction
to take place on such Settlement Date, each Lender shall hold its Pro Rata
share of all Revolver Loans and participations in LC Obligations.
Administrative Agent shall request settlement with the Lenders on a basis
not less frequently than once every 5 Business Days.
(ii) Between Settlement Dates, Administrative Agent may request
BofA to advance, and BofA may, but shall in no event be obligated to,
advance to Borrowers out of BofA's own funds the entire principal amount of
any Borrowing of Revolver Loans that are Base Rate Loans requested or
deemed requested pursuant to this Agreement (any such Revolver Loan funded
exclusively by BofA being referred to as a "Swingline Loan"). Each
Swingline Loan shall constitute a Revolver Loan hereunder and shall be
subject to all of the terms, conditions and security applicable to other
Revolver Loans, except that all payments thereon shall be payable to BofA
solely for its own account. The obligation of Borrowers to repay such
Swingline Loans to BofA shall be evidenced by the records of BofA and need
not be evidenced by any promissory note. Unless a funding is required by
all Lenders pursuant to SECTION 13.9.4, Administrative Agent may but shall
not be required to request BofA to make any Swingline Loan if (A)
Administrative Agent shall have received written notice from any Lender
that one or more of the applicable conditions precedent set forth in
SECTION 11 will not be satisfied on the requested funding date for the
applicable Borrowing and Administrative Agent has made a determination
(without any liability to any Person) that such condition precedent will
not be satisfied, (B) the requested Borrowing would exceed the amount of
Availability on the funding date or (C) the aggregate amount of Swingline
Loans outstanding exceeds (or with the funding of the requested Swingline
Loan, would exceed) $5,000,000. BofA shall not be required to determine
whether the applicable conditions precedent set forth in SECTION 11 have
been satisfied or the requested Borrowing would exceed the amount of
Availability on the funding date applicable thereto prior to making, in its
discretion, any Swingline Loan. On each Settlement Date, or, if earlier, on
demand by Administrative Agent for payment thereof, the then outstanding
Swingline Loans shall be immediately due and payable. As provided in
SECTION 4.1.1(II), Borrowers shall be deemed to have requested (without the
necessity of submitting any Notice of Borrowing) Revolver Loans to be made
on each Settlement Date in the amount of all outstanding Swingline Loans
and to have Administrative Agent cause the proceeds of such Revolver Loans
to be applied to the repayment of such Swingline Loans and interest accrued
thereon. Administrative Agent shall notify the Lenders of the outstanding
balance of Revolver Loans prior to 11:00 a.m. on each Settlement Date and
each Lender (other than BofA) shall deposit with Administrative Agent an
amount equal to its Pro Rata share of the amount of Revolver Loans deemed
requested in immediately available funds not later than 2:00 p.m. on such
Settlement Date. Each Lender's obligation to make such deposit with
Administrative Agent shall be absolute and unconditional, without defense,
offset, counterclaim or other defense, and without regard to whether any of
the conditions precedent set forth in SECTION 11 are satisfied, any
Out-of-Formula Condition exists or the Commitment Termination Date has
occurred. If, as the result of the commencement by or against Borrowers of
any Insolvency Proceeding or otherwise, any Swingline Loan may not be
repaid by the funding by Lenders of Revolver Loans, then each Lender (other
than BofA) shall be deemed to have purchased a participating interest in
any unpaid Swingline Loan in an amount equal to such Lender's Pro Rata
share of such Swingline Loan and shall transfer to BofA, in immediately
available funds not later than the second Business Day after BofA's request
therefor, the amount of such Lender's participation. The proceeds of
Swingline Loans may be used solely
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for purposes for which Revolver Loans generally may be used in accordance
with SECTION 2.1.3. If any amounts received by BofA in respect of any
Swingline Loans are later required to be returned or repaid by BofA to
Borrowers or any other Obligor or their respective representatives or
successors-in-interest, whether by court order, settlement or otherwise,
the other Lenders shall, on demand by BofA with notice to Administrative
Agent, pay to Administrative Agent for the account of BofA, an amount equal
to each other Lender's Pro Rata share of all such amounts required to be
returned or repaid.
4.1.4. Disbursement Authorization. Each Borrower hereby irrevocably
authorizes Administrative Agent to disburse the proceeds of each Revolver Loan
requested by any Borrower, or deemed to be requested pursuant to SECTION 4.1.1
or SECTION 4.1.3(II) as follows: (i) the proceeds of each Revolver Loan
requested under SECTION 4.1.1(I) shall be disbursed by Administrative Agent in
accordance with the terms of the written disbursement letter from Borrowers in
the case of the initial Borrowing, and, in the case of each subsequent
Borrowing, by transfer to such bank account of Borrowers as may be directed by
Borrowers from time to time or elsewhere if pursuant to a written direction from
any Borrower; and (ii) the proceeds of each Revolver Loan requested under
SECTION 4.1.1(II) or SECTION 4.1.3(II) shall be disbursed by Administrative
Agent by way of direct payment of the relevant interest or other Obligation. Any
Loan proceeds received by any Borrower or in payment of any of the Obligations
shall be deemed to have been received by all Borrowers.
4.1.5. Telephonic Notices. Each Borrower authorizes Administrative
Agent and Lenders to extend, convert or continue Loans, effect selections of
Types of Loans and transfer funds to or on behalf of Borrowers based on
telephonic notices or instructions from any individual whom Administrative Agent
or any Lender in good faith believes to be acting on behalf of any Borrower. If
requested by Administrative Agent, Borrowers shall confirm each such telephonic
request for a Borrowing or conversion or continuation of Loans by prompt
delivery to Administrative Agent of the required Notice of Borrowing or Notice
of Conversion/Continuation, as applicable, duly executed by an authorized
officer of Borrower Agent. If the written confirmation differs in any material
respect from the action taken by Administrative Agent or Lenders, the records of
Administrative Agent and Lenders shall govern. Neither Administrative Agent nor
any Lender shall have any liability for any loss suffered by any Borrower as a
result of Administrative Agent's or any Lender's acting upon its understanding
of telephonic instructions or requests from a person believed in good faith by
Administrative Agent or any Lender to be a person authorized by a Borrower to
give such instructions or to make such requests on Borrowers' behalf.
4.2. DEFAULTING LENDER. If any Lender shall, at any time, fail to make any
payment to Administrative Agent or BofA that is required hereunder,
Administrative Agent may, but shall not be required to, retain payments that
would otherwise be made to such defaulting Lender hereunder and apply such
payments to such defaulting Lender's defaulted obligations hereunder, at such
time, and in such order, as Administrative Agent may elect in its discretion.
With respect to the payment of any funds from Administrative Agent to a Lender
or from a Lender to Administrative Agent, the party failing to make the full
payment when due pursuant to the terms hereof shall, on demand by the other
party, pay such amount together with interest on such amount at the Federal
Funds Rate. The failure of any Lender to fund its portion of any Loan or payment
in respect of an LC Obligation shall not relieve any other Lender of its
obligation, if any, to fund its portion of the Revolver Loan or payment in
respect of an LC Obligation on the date of Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make any Loan or payment in
respect of an LC Obligation. Solely as among the Lenders and solely for purposes
of (i) voting upon or consenting to amendments, waivers, actions or inactions
under any of the Loan Documents, or with respect to the Collateral or any
Obligations, and (ii) determining a defaulting Lender's share of payments and
proceeds of Collateral pending such defaulting Lender's cure of its defaults
hereunder, a defaulting Lender shall not be deemed to be a "Lender" and such
Lender's Commitment shall
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be deemed to be zero (0). The provisions of this Section 4.2 shall be solely for
the benefit of Administrative Agent and Lenders and may not be enforced by
Borrowers.
4.3. SPECIAL PROVISIONS GOVERNING LIBOR LOANS.
4.3.1. Number of LIBOR Loans. In no event may the number of LIBOR
Loans outstanding at any time to any Lender exceed 4.
4.3.2. Minimum Amounts. Each Borrowing of LIBOR Loans pursuant to
SECTION 4.1.1(I), and each continuation of or conversion to LIBOR Loans pursuant
to SECTION 3.1.2, shall be in a minimum amount of $1,000,000 and integral
multiples of $50,000 in excess of that amount.
4.3.3. LIBOR Lending Office. Each Lender's initial LIBOR Lending
Office is set forth opposite its name on the signature pages hereof. Each Lender
shall have the right at any time and from time to time to designate a different
office of itself or of any Affiliate as such Lender's LIBOR Lending Office, and
to transfer any outstanding LIBOR Loans to such LIBOR Lending Office. No such
designation or transfer shall result in any liability on the part of Borrowers
for increased costs or expenses resulting solely from such designation or
transfer. Increased costs for expenses resulting from a change in Applicable Law
occurring subsequent to any such designation or transfer shall be deemed not to
result solely from such designation or transfer.
4.3.4. Funding of LIBOR Loans. Each Lender may, if it so elects,
fulfill its obligation to make, continue or convert LIBOR Loans hereunder by
causing one of its foreign branches or Affiliates (or an international banking
facility created by such Lender) to make or maintain such LIBOR Loans; provided,
however, that such LIBOR Loans shall nonetheless be deemed to have been made and
to be held by such Lender, and the obligation of Borrowers to repay such LIBOR
Loans shall nevertheless be to such Lender for the account of such foreign
branch, Affiliate or international banking facility and provided Borrowers bear
no increased costs as a result of Lenders funding through a foreign branch or
Affiliate. The calculation of all amounts payable to Lender under SECTIONS 3.7
and 3.10 shall be made as if each Lender had actually funded or committed to
fund its LIBOR Loan through the purchase of an underlying deposit in an amount
equal to the amount of such LIBOR Loan and having a maturity comparable to the
relevant Interest Period for such LIBOR Loans; provided, however, each Lender
may fund its LIBOR Loans in any manner it deems fit and the foregoing
presumption shall be utilized only for the calculation of amounts payable under
SECTIONS 3.7 and 3.10.
4.4. BORROWER AGENT. Each Borrower hereby irrevocably appoints InSight
Health, and InSight Health agrees to act under this Agreement, as the agent and
representative of itself and each other Borrower for all purposes under this
Agreement (in such capacity, "Borrower Agent"), including requesting Borrowings,
selecting whether any Loan or portion thereof is to bear interest as a Base Rate
Loan or a LIBOR Loan, and receiving account statements and other notices and
communications to Borrowers (or any of them) from Administrative Agent.
Administrative Agent may rely, and shall be fully protected in relying, on any
Notice of Borrowing, Notice of Conversion/Continuation, disbursement
instructions, reports, information, Borrowing Base Certificate or any other
notice or communication made or given by Borrower Agent, whether in its own
name, on behalf of any Borrower or on behalf of "the Borrowers," and
Administrative Agent shall have no obligation to make any inquiry or request any
confirmation from or on behalf of any other Borrower as to the binding effect on
such Borrower of any such Notice of Borrowing, Notice of Conversion
Continuation, instruction, report, information, Borrowing Base Certificate or
other notice or communication, nor shall the joint and several character of
Borrowers' liability for the Obligations be affected, provided that the
provisions of this SECTION 4.3 shall not be construed so as to preclude any
Borrower from directly requesting Borrowings or taking other actions permitted
to be taken by "a Borrower" hereunder. Administrative Agent may maintain a
single
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Loan Account in the name of "InSight Health Services Corp." hereunder, and each
Borrower expressly agrees to such arrangement and confirms that such arrangement
shall have no effect on the joint and several character of such Borrower's
liability for the Obligations.
4.5. ALL LOANS TO CONSTITUTE ONE OBLIGATION. The Loans and LC Obligations
shall constitute one general obligation of Borrowers and (unless otherwise
expressly provided in any Security Document) shall be secured by Administrative
Agent's Lien upon all of the Collateral; provided, however, that Administrative
Agent and each Lender shall be deemed to be a creditor of each Borrower and the
holder of a separate claim against each Borrower to the extent of any
Obligations jointly and severally owed by Borrowers to Administrative Agent or
such Lender.
SECTION 5. PAYMENTS
5.1. GENERAL PAYMENT PROVISIONS. All payments (including all prepayments)
of principal of and interest on the Loans, LC Obligations and other Obligations
that are payable to Administrative Agent or any Lender shall be made to
Administrative Agent in Dollars without any offset or counterclaim and free and
clear of (and without deduction for) any present or future Taxes other than
Excluded Taxes, as required by Applicable Law, and, with respect to payments
made other than by application of balances in the Payment Account, in
immediately available funds not later than 2:00 p.m. on the due date (and
payment made after such time on the due date to be deemed to have been made on
the next succeeding Business Day). Borrowers shall, at the time Borrowers make
any payment under this Agreement, specify to Administrative Agent the
Obligations to which such payment is to be applied and, if Borrowers fail so to
specify or if the application specified by Borrowers would be inconsistent with
the terms of this Agreement or if an Event of Default exists, Administrative
Agent shall distribute such payment to Lenders for application to the
Obligations in such manner as Administrative Agent, subject to the provisions of
this Agreement, may determine to be appropriate. All payments received by
Administrative Agent shall be subject to the rights of offset that
Administrative Agent may have as to amounts otherwise to be remitted to a
particular Lender by reason of amounts due Administrative Agent from such Lender
under any of the Loan Documents, without prejudice to the rights of Borrowers.
5.2. REPAYMENT OF REVOLVER LOANS.
5.2.1. Payment of Principal. The outstanding principal amounts with
respect to the Revolver Loans shall be repaid as follows:
(i) Any portion of the Revolver Loans consisting of the principal
amount of Base Rate Loans shall be paid by Borrowers to Administrative
Agent, for the Pro Rata benefit of Lenders (or, in the case of Swingline
Loans, for the sole benefit of BofA) unless timely converted to a LIBOR
Loan in accordance with this Agreement, (a) if a Restrictive Trigger Event
has occurred and is continuing, upon each receipt by Administrative Agent
or any Lender of any proceeds of Accounts (other than that portion thereof
payable to physicians pursuant to PSAs), or within 7 Business Days of each
receipt by Borrowers of any such proceeds, in each case to the extent of
such proceeds, (b) the Commitment Termination Date, and (c) in the case of
Swingline Loans, if a Restrictive Trigger Event has occurred and is
continuing, the earlier of BofA's demand for payment or on each Settlement
Date with respect to all Swingline Loans outstanding on such date.
(ii) Any portion of the Revolver Loans consisting of the
principal amount of LIBOR Loans shall be paid by Borrowers to
Administrative Agent, for the Pro Rata benefit of Lenders, unless continued
as a LIBOR Loan in accordance with the terms of this Agreement, immediately
upon (a) the last day of the Interest Period applicable thereto and (b) the
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Commitment Termination Date. In no event shall Borrowers be authorized to
make a voluntary prepayment with respect to any Revolver Loan outstanding
as a LIBOR Loan prior to the last day of the Interest Period applicable
thereto unless (x) otherwise agreed in writing by Administrative Agent or
Borrowers are otherwise expressly authorized or required by any other
provision of this Agreement to pay any LIBOR Loan outstanding on a date
other than the last day of the Interest Period applicable thereto, and (y)
Borrowers pay to Administrative Agent, for the Pro Rata benefit of Lenders,
concurrently with any prepayment of a LIBOR Loan, any amount due
Administrative Agent and Lenders under SECTION 3.10 as a consequence of
such prepayment. Notwithstanding the foregoing provisions of this SECTION
5.2.1(II), if, on any date that Administrative Agent receives proceeds of
Accounts or other Collateral, there are no Revolver Loans outstanding as
Base Rate Loans, Administrative Agent may either hold such proceeds as cash
security for the timely payment of the Obligations or apply such proceeds
to any outstanding Revolver Loans bearing interest as LIBOR Loans as the
same become due and payable (whether at the end of the applicable Interest
Periods or on the Commitment Termination Date).
(iii) Notwithstanding anything to the contrary contained
elsewhere in this Agreement, if an Out-of-Formula Condition shall exist,
Borrowers shall, on the sooner to occur of 2 Business Days after
Administrative Agent's demand or 2 Business Days after any Borrower has
obtained knowledge of such Out-of-Formula Condition, repay the outstanding
Revolver Loans that are Base Rate Loans in an amount sufficient to reduce
the aggregate unpaid principal amount of all Revolver Loans by an amount
equal to such excess; and, if such payment of Base Rate Loans is not
sufficient to eliminate the Out-of-Formula Condition, then Borrowers shall
immediately deposit with Administrative Agent, for the Pro Rata benefit of
Lenders, for application to any outstanding Revolver Loans bearing interest
as LIBOR Loans as the same become due and payable (whether at the end of
the applicable Interest Periods or on the Commitment Termination Date) cash
in an amount sufficient to eliminate such Out-of-Formula Condition, and
Administrative Agent may (a) hold such deposit as cash security pending
disbursement of same for application to the Obligations, or (b) if an Event
of Default exists, immediately apply such proceeds to the payment of the
Obligations, including the Revolver Loans outstanding as LIBOR Loans (in
which event Borrowers shall also pay to Administrative Agent for the
benefit of Lenders any amounts required by SECTION 3.10 to be paid by
reason of the prepayment of a LIBOR Loan prior to the last day of the
Interest Period applicable thereto).
5.2.2. Payment of Interest. Interest accrued on the Revolver Loans
shall be due and payable on (i) the first day of each month (for the immediately
preceding month), computed through the last day of the preceding month, with
respect to any Revolver Loan that is a Base Rate Loan and (ii) the last day of
the applicable Interest Period in the case of a LIBOR Loan. Accrued interest
shall also be paid by Borrowers on the Commitment Termination Date. With respect
to any Base Rate Loan converted into a LIBOR Loan pursuant to SECTION 3.1.2 on a
day when interest would not otherwise have been payable with respect to such
Base Rate Loan, accrued interest to the date of such conversion on the amount of
such Base Rate Loan so converted shall be paid on the conversion date.
5.3. RESERVED.
5.4. PAYMENT OF OTHER OBLIGATIONS. The balance of the Obligations requiring
the payment of money, including LC Obligations and Extraordinary Expenses
incurred by Administrative Agent or any Lender, shall be repaid by Borrowers to
Administrative Agent for allocation among Administrative Agent and Lenders as
provided in the Loan Documents, or, if no date of payment is otherwise specified
in the Loan Documents, ON DEMAND.
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5.5. MARSHALING; PAYMENTS SET ASIDE. None of Administrative Agent or
Lenders shall be under any obligation to marshal any assets in favor of
Borrowers or any other Obligor or against or in payment of any or all of the
Obligations. To the extent that Borrowers make a payment to Administrative Agent
or Lenders or Administrative Agent or any Lender receives payment from the
proceeds of any Collateral or exercises its right of setoff, and such payment or
the proceeds of such Collateral or setoff (or any part thereof) are subsequently
invalidated, declared to be fraudulent or preferential, set aside or required to
be repaid to a trustee, receiver or any other Person, then to the extent of any
loss by Administrative Agent or Lenders, the Obligations or part thereof
originally intended to be satisfied, and all Liens, rights and remedies
therefor, shall be revived and continued in full force and effect as if such
payment or proceeds had not been made or received and any such enforcement or
setoff had not occurred. The provisions of the immediately preceding sentence of
this SECTION 5.5 shall survive any termination of the Commitments and Full
Payment of the Obligations.
5.6. ALLOCATION OF PAYMENTS.
5.6.1. Allocation. At any time that an Event of Default exists or
Administrative Agent receives a payment or Collateral proceeds in an amount that
is insufficient to pay all amounts then due and payable to Administrative Agent
and Lenders, all monies to be applied to the Obligations, whether such monies
represent voluntary or mandatory payments or prepayments by one or more Obligors
or are received pursuant to demand for payment or realized from any disposition
of Collateral and irrespective of any designation by Borrowers of the
Obligations that are intended to be satisfied, shall be allocated among
Administrative Agent and such of the Lenders as are entitled thereto (and, with
respect to monies allocated to Lenders, on a Pro Rata basis unless otherwise
provided herein): (i) first, to Administrative Agent to pay the amount of
Extraordinary Expenses that have not been reimbursed to Administrative Agent by
Borrowers or Lenders, together with interest accrued thereon at the rate
applicable to Revolver Loans that are Base Rate Loans, until Full Payment of all
such Obligations; (ii) second, to Administrative Agent to pay principal and
accrued interest on any portion of the Revolver Loans which Administrative Agent
may have advanced on behalf of any Lender and for which Administrative Agent has
not been reimbursed by such Lender or Borrowers, until Full Payment of all such
Obligations; (iii) third, to BofA to pay the principal and accrued interest on
any portion of the Swingline Loans outstanding, to be shared with Lenders that
have acquired and paid for a participating interest in such Swingline Loans,
until Full Payment of all such Obligations; (iv) fourth, to the extent that
Issuing Bank has not received from any Participating Lender a payment as
required by SECTION 2.3.2, to Issuing Bank to pay all such required payments
from each Participating Lender, until Full Payment of all such Obligations; (v)
fifth, to Administrative Agent to pay any Claims that have not been paid
pursuant to any indemnity of Administrative Agent Indemnitees by any Obligor, or
to pay amounts owing by Lenders to Administrative Agent Indemnitees pursuant to
SECTION 13.6, in each case together with interest accrued thereon at the rate
applicable to Revolver Loans that are Base Rate Loans, until Full Payment of all
such Obligations; (vi) sixth, to Administrative Agent to pay any fees due and
payable to Administrative Agent, until Full Payment of all such Obligations;
(vii) seventh, to each Lender, ratably, for any Claims that such Lender has paid
to Administrative Agent Indemnitees pursuant to its indemnity of Administrative
Agent Indemnitees and any Extraordinary Expenses that such Lender has reimbursed
to Administrative Agent or such Lender has incurred, to the extent that such
Lender has not been reimbursed by Obligors therefor, until Full Payment of all
such Obligations; (viii) eighth, to Issuing Bank to pay principal and interest
with respect to LC Obligations (or to the extent any of the LC Obligations are
contingent and an Event of Default then exists, deposited in the Cash Collateral
Account to Cash Collateralize the LC Obligations), which payment shall be shared
with the Participating Lenders in accordance with SECTION 2.3.2(III), until Full
Payment of all such Obligations; (ix) ninth, to Lenders in payment of the unpaid
principal and accrued interest in respect of the Loans and other Obligations
(excluding Banking Relationship Debt) then outstanding, in such order of
application as shall be designated by Administrative Agent (acting at the
direction or with the consent of the Required Lenders), until Full Payment of
all such Obligations; (x)
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tenth, to BofA or any Affiliate of BofA in payment of any Banking Relationship
Debt owed to such Person and secured by the Collateral hereunder, until Full
Payment of all such Obligations; and (xi) eleventh, to Borrowers as provided in
SECTION 5.7. The allocations set forth in this SECTION 5.6 are solely to
determine the rights and priorities of Administrative Agent and Lenders as among
themselves and may be changed by Administrative Agent and Lenders without notice
to or the consent or approval of any Borrower or any other Person.
5.6.2. Erroneous Allocation. Administrative Agent shall not be liable
for any allocation or distribution of payments made by it in good faith and, if
any such allocation or distribution is subsequently determined to have been made
in error, the sole recourse of any Lender to which payment was due but not made
shall be to recover from the other Lenders any payment in excess of the amount
to which such other Lenders are determined to be entitled (and such other
Lenders hereby agree to return to such Lender any such erroneous payments
received by them).
5.7. APPLICATION OF PAYMENTS AND COLLATERAL PROCEEDS. All Payment Items
received by Administrative Agent by 2:00 p.m., on any Business Day shall be
deemed received on that Business Day. All Payment Items received by
Administrative Agent after 2:00 p.m., on any Business Day shall be deemed
received on the following Business Day. Each Borrower irrevocably waives the
right to direct the application of any and all payments and Collateral proceeds
at any time or times hereafter received by Administrative Agent or any Lender
from or on behalf of Borrowers, and each Borrower does hereby irrevocably agree
that Administrative Agent shall have the continuing exclusive right to apply and
reapply any and all such payments and Collateral proceeds received at any time
or times hereafter by Administrative Agent or its agent against the Obligations,
in such manner as Administrative Agent may deem advisable, notwithstanding any
entry by Administrative Agent upon any of its books and records; provided,
however, that any payments or proceeds of Collateral received by Administrative
Agent on any date that an Event of Default does not exist shall be applied in
accordance with any provisions of this Agreement that govern the application of
such payment or proceeds. If, as the result of Administrative Agent's collection
of proceeds of Accounts and other Collateral as authorized by SECTION 8.2.6 a
credit balance exists, such credit balance shall not accrue interest in favor of
Borrowers, but shall be remitted to Borrowers unless (x) there exists an Event
of Default and (y) there are LC Obligations outstanding that have not been Cash
Collateralized. Administrative Agent may apply such credit balance against any
of the Obligations upon and after the occurrence of an Event of Default, and to
the extent so applied, such credit balance shall be applied in the manner
specified in SECTION 5.6.1.
5.8. LOAN ACCOUNTS; ACCOUNT STATED.
5.8.1. Loan Accounts. Each Lender shall maintain in accordance with
its usual and customary practices an account or accounts (a "Loan Account")
evidencing the Debt of Borrowers to such Lender resulting from each Loan owing
to Lender from time to time, including the amount of principal and interest
payable to such Lender from time to time hereunder and under each Note payable
to such Lender. Any failure of a Lender to record in the Loan Account, or any
error in doing so, shall not limit or otherwise affect the obligation of
Borrowers hereunder (or under any Note) to pay any amount owing hereunder to
such Lender.
5.8.2. The Register. Administrative Agent shall maintain a register
(the "Register"), which shall include a master account and a subsidiary account
for each Lender and in which accounts (taken together) shall be recorded (i) the
date and amount of each Borrowing made hereunder, the Type of each Loan
comprising such Borrowing and any Interest Period applicable thereto, (ii) the
effective date and amount of each Assignment and Acceptance delivered to and
accepted by it and the parties thereto, (iii) the amount of any principal or
interest due and payable or to become due and payable from Borrowers to each
Lender hereunder or under the Notes, and (iv) the amount of any sum received by
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Administrative Agent from Borrowers or any other Obligor and each Lender's Pro
Rata share thereof. The Register shall be available for inspection by Borrowers
or any Lender at the offices of Administrative Agent at any reasonable time and
from time to time upon reasonable prior notice. Any failure of Administrative
Agent to record in the Register, or any error in doing so, shall not limit or
otherwise affect the obligation of Borrowers hereunder (or under any Note) to
pay any amount owing with respect to the Loans or provide the basis for any
claim against Administrative Agent. The Obligations and Letters of Credit are
registered obligations and the right, title and interest of any Lender and their
assignees in and to such Obligations and Letters of Credit as the case may be,
shall be transferable only upon notation of such transfer in the Register.
Solely for purposes of this SECTION 5.8.2 and for tax purposes only,
Administrative Agent shall be Borrowers' agent for purposes of maintaining the
Register (but Administrative Agent shall have no liability whatsoever to any
Borrower or any other Person on account of any inaccuracies contained in the
Register). This SECTION 5.8.2 shall be construed so that the Obligations and
Letters of Credit are at all times maintained in "registered form" within the
meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Internal Revenue Code
of 1986, as amended, and any related regulations (and any other relevant or
successor provisions of the Internal Revenue Code of 1986, as amended, or such
regulations).
5.8.3. Entries Binding. The entries made in the Register and each Loan
Account shall constitute rebuttably presumptive evidence of the information
contained therein; provided, however, that if a copy of information contained in
the Register or any Loan Account is provided to any Person, or any Person
inspects the Register or any Loan Account, at any time or from time to time,
then the information contained in the Register or the Loan Account, as
applicable, shall be conclusive and binding on such Person for all purposes
absent manifest error, unless such Person notifies Administrative Agent in
writing within 30 days after such Person's receipt of such copy or such Person's
inspection of the Register or Loan Account of its intention to dispute the
information contained therein.
5.9. TAXES.
5.9.1. Gross Up. If Borrowers shall be required by Applicable Law to
withhold or deduct any Taxes (other than Excluded Taxes) from or in respect of
any sum payable under this Agreement or any of the other Loan Documents, (a) the
sum payable to Administrative Agent or such Lender shall be increased as may be
necessary so that, after making all required withholding or deductions,
Administrative Agent or such Lender (as the case may be) receives an amount
equal to the sum it would have received had no such withholding or deductions
been made, (b) Borrowers shall make such withholding or deductions, and (c)
Borrowers shall pay the full amount withheld or deducted to the relevant
taxation authority or other authority in accordance with Applicable Law.
5.9.2. Refund. If Administrative Agent or any Lender receives a
refund, credit, or other reduction of taxes in respect of any Taxes paid by
Borrowers pursuant to this SECTION 5.9, such Person shall, within 30 days from
the date of actual receipt of such refund or the filing of the tax return in
which such credit or other reduction results in a lower tax payment, pay over
such refund or the amount of such tax reduction to Borrowers (but only to the
extent of Taxes paid by Borrowers pursuant to this SECTION 5.9), net of all
out-of-pocket expenses of such Person, and without interest (other than interest
paid by the relevant Governmental Authority with respect to such refund).
5.9.3. Foreign Lenders. Each Foreign Lender, on or prior to the date
of its execution and delivery of this Agreement, on or prior to the date on
which it designates a new lending office, and on or prior to the date on which
it becomes a Lender, in the case of an assignee, and from time to time
thereafter if requested in writing by Borrowers, shall provide Borrowers with
duplicate executed originals of (A) Internal Revenue Service Form W-8 BEN, or
any successor form, certifying that such Lender is entitled to benefits under
any income tax treaty to which the United States is a party which reduces to
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zero the rate of withholding tax on payments of interest, or (B) Internal
Revenue Service Form W-8ECI, or any successor form, certifying that the income
receivable pursuant to this Agreement is effectively connected with the conduct
of a trade or business in the United States; or (C) with respect to any Lender
that is not a bank and is eligible for exemption from tax under SECTION 881(C)
or 871(H) of the Internal Revenue Code of 1986, as amended, Internal Revenue
Service Form W-8 BEN, or any successor form, and a certificate substantially in
the form of Exhibit J hereto. Each Foreign Lender who does not deliver a Form
W-8ECI represents that all services performed hereunder with respect to any fees
received or to be received will have been, and will be, performed outside of the
United States.
5.9.4. Remedy. In the event that Borrowers are required to pay
additional amounts pursuant to SECTION 3.7 or SECTION 5.9.1 hereof, Borrowers
may, upon notice to such Lender, either prepay in whole or in part the
outstanding balance on any Loan held by such Lender or require such Lender to
assign and delegate, without recourse all of its interests, rights and
obligations under this Agreement to an assignee selected by Borrowers that shall
assume such obligations (which assignee may be another Lender, if a Lender
accepts such assignment).
5.10. NATURE AND EXTENT OF EACH BORROWER'S LIABILITY.
5.10.1. Joint and Several Liability. Each Borrower shall be liable
for, on a joint and several basis, and hereby guarantees the timely payment by
all other Borrowers of, all of the Loans and other Obligations, regardless of
which Borrower actually may have received the proceeds of any Loans or other
extensions of credit hereunder or the amount of such Loans received or the
manner in which Administrative Agent or any Lender accounts for such Loans or
other extensions of credit on its books and records, it being acknowledged and
agreed that Loans to any Borrower inure to the mutual benefit of all Borrowers
and that Administrative Agent and Lenders are relying on the joint and several
liability of Borrowers in extending the Loans and other financial accommodations
hereunder. Each Borrower hereby unconditionally and irrevocably agrees that upon
default in the payment when due (whether at stated maturity, by acceleration or
otherwise) of any principal of, or interest owed on, any of the Loans or other
Obligations, such Borrower shall forthwith pay the same, without notice or
demand.
5.10.2. Unconditional Nature of Liability. Each Borrower's joint and
several liability hereunder with respect to, and guaranty of, the Loans and
other Obligations shall, to the fullest extent permitted by Applicable Law, be
unconditional irrespective of (i) the validity, enforceability, avoidance or
subordination of any of the Obligations or of any promissory note or other
document evidencing all or any part of the Obligations, (ii) the absence of any
attempt to collect any of the Obligations from any other Obligor or any
Collateral or other security therefor, or the absence of any other action to
enforce the same, (iii) the waiver, consent, extension, forbearance or granting
of any indulgence by Administrative Agent or any Lender with respect to any
provision of any instrument evidencing or securing the payment of any of the
Obligations, or any other agreement now or hereafter executed by any other
Borrower and delivered to Administrative Agent or any Lender, (iv) the failure
by Administrative Agent to take any steps to perfect or maintain the perfected
status of its security interest in or Lien upon, or to preserve its rights to,
any of the Collateral or other security for the payment or performance of any of
the Obligations or Administrative Agent's release of any Collateral or of its
Liens upon any Collateral, (v) Administrative Agent's or Lenders' election, in
any proceeding instituted under the Bankruptcy Code, for the application of
Section 1111(b)(2) of the Bankruptcy Code, (vi) any borrowing or grant of a
security interest by any other Borrower, as debtor-in-possession under Section
364 of the Bankruptcy Code, (vii) the release or compromise, in whole or in
part, of the liability of any Obligor for the payment of any of the Obligations,
(viii) any amendment or modification of any of the Loan Documents or any waiver
of a Default or Event of Default, (ix) any increase in the amount of the
Obligations beyond any limits imposed herein or in the amount of any interest,
fees or other charges payable in connection therewith, or any decrease in the
same, (x) the disallowance of all or any portion of Administrative Agent's or
any Lender's claims against
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any other Obligor for the repayment of any of the Obligations under Section 502
of the Bankruptcy Code, or (xi) any other circumstance that might constitute a
legal or equitable discharge or defense of any Obligor (other than prior
payment). After the occurrence and during the continuance of any Event of
Default, Administrative Agent may proceed directly and at once, without notice
to any Obligor, against any or all of Obligors to collect and recover all or any
part of the Obligations, without first proceeding against any other Obligor or
against any Collateral or other security for the payment or performance of any
of the Obligations, and each Borrower waives any provision under Applicable Law
that might otherwise require Administrative Agent to pursue or exhaust its
remedies against any Collateral or Obligor before pursuing another Obligor. Each
Borrower consents and agrees that Administrative Agent shall be under no
obligation to marshal any assets in favor of any Obligor or against or in
payment of any or all of the Obligations.
5.10.3. No Reduction in Liability for Obligations. No payment or
payments made by an Obligor or received or collected by Administrative Agent
from a Borrower or any other Person by virtue of any action or proceeding or any
setoff or appropriation or application at any time or from time to time in
reduction of or in payment of the Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of any Borrower under this Agreement,
each of whom shall remain jointly and severally liable for the payment and
performance of all Loans and other Obligations until Full Payment of the
Obligations.
5.10.4. Contribution. Each Borrower is unconditionally obligated to
repay the Obligations as a joint and several obligor under this Agreement. If,
as of any date, the aggregate amount of payments made by a Borrower on account
of the Obligations and proceeds of such Borrower's Collateral that are applied
to the Obligations exceeds the aggregate amount of Loan proceeds actually used
by such Borrower in its business (such excess amount being referred to as an
"Accommodation Payment"), then each of the other Borrowers (each such Borrower
being referred to as a "Contributing Borrower") shall be obligated to make
contribution to such Borrower (the "Paying Borrower") in an amount equal to (A)
the product derived by multiplying the sum of each Accommodation Payment of each
Borrower by the Allocable Percentage of the Borrower from whom contribution is
sought less (B) the amount, if any, of the then outstanding Accommodation
Payment of such Contributing Borrower (such last mentioned amount which is to be
subtracted from the aforesaid product to be increased by any amounts theretofore
paid by such Contributing Borrower by way of contribution hereunder, and to be
decreased by any amounts theretofore received by such Contributing Borrower by
way of contribution hereunder); provided, however, that a Paying Borrower's
recovery of contribution hereunder from the other Borrowers shall be limited to
that amount paid by the Paying Borrower in excess of its Allocable Percentage of
all Accommodation Payments then outstanding of all Borrowers. As used herein,
the term "Allocable Percentage" shall mean, on any date of determination
thereof, a fraction the denominator of which shall be equal to the number of
Borrowers who are parties to this Agreement on such date and the numerator of
which shall be 1; provided, however, that such percentages shall be modified in
the event that contribution from a Borrower is not possible by reason of
insolvency, bankruptcy or otherwise by reducing such Borrower's Allocable
Percentage equitably and by adjusting the Allocable Percentage of the other
Borrowers proportionately so that the Allocable Percentages of all Borrowers at
all times equals 100%.
5.10.5. Subordination. Each Borrower hereby subordinates any claims,
including any right of payment, subrogation, contribution and indemnity, that it
may have from or against any other Obligor, and any successor or assign of any
other Obligor, including any trustee, receiver or debtor-in-possession,
howsoever arising, due or owing or whether heretofore, now or hereafter
existing, to the Full Payment of all of the Obligations (other than contingent
indemnification obligations for which no claim has been made).
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SECTION 6. TERM AND TERMINATION OF COMMITMENT
6.1. TERM OF COMMITMENTS. Subject to each Lender's right to cease making
Loans and other extensions of credit to Borrowers when any Default or Event of
Default exists or upon termination of the Commitments as provided in SECTION
6.2, the Commitments shall be in effect for a period (the "Term") commencing on
the date hereof and continuing until the close of business on September 22,
2010, unless sooner terminated as provided in SECTION 6.2.
6.2. TERMINATION.
6.2.1. Termination by Administrative Agent. Administrative Agent may
(and upon the direction of the Required Lenders, shall) terminate the Commitment
without notice at any time that an Event of Default exists; provided, however,
that the Commitment shall automatically terminate as provided in SECTION 12.2.
6.2.2. Termination by Borrowers. Upon at least 30 days prior written
notice to Administrative Agent, Borrowers may, at their option, terminate the
Commitments; provided, however, no such termination by Borrowers shall be
effective until Full Payment of the Obligations (other than contingent
indemnification obligations for which no claim has been made). Any notice of
termination given by Borrowers shall be irrevocable unless Administrative Agent
otherwise agrees in writing. Borrowers may elect to terminate the Commitments in
their entirety only, provided that nothing contained herein shall affect
Borrowers' right to voluntarily reduce the Revolver Commitments as provided in
SECTION 2.1.5. No section of this Agreement, Type of Loan available hereunder or
Commitment may be terminated by Borrowers singly.
6.2.3. Reserved.
6.2.4. Effect of Termination. On the effective date of termination of
the Commitments by Administrative Agent or by Borrowers, all of the Obligations
(other than contingent indemnification obligations for which no claim has been
made) shall be immediately due and payable; Lenders shall have no obligation to
make any Loans; Issuing Bank shall have no obligation to issue any Letters of
Credit, and BofA may terminate any Bank Products (including any services or
products under Cash Management Agreements). All undertakings, agreements,
covenants, warranties and representations of Borrowers contained in the Loan
Documents shall survive any such termination, and Administrative Agent shall
retain its Liens in the Collateral and all of its rights and remedies under the
Loan Documents notwithstanding such termination until Full Payment of the
Obligations (other than contingent indemnification obligations for which no
claim has been made). Notwithstanding the Full Payment of the Obligations (other
than contingent indemnification obligations for which no claim has been made),
Administrative Agent shall not be required to terminate its Liens in any of the
Collateral unless, with respect to any loss or damage Administrative Agent may
incur as a result of the dishonor or return of any Payment Items applied to the
Obligations, Administrative Agent shall have received either (i) a written
agreement, executed by Borrowers and any Person deemed financially responsible
by Administrative Agent whose loans or other advances to Borrowers are used in
whole or in part to satisfy the Obligations, indemnifying Administrative Agent
and Lenders from any such loss or damage; or (ii) such monetary reserves and
Liens on the Collateral for such period of time as Administrative Agent, in its
reasonable discretion, may deem necessary to protect Administrative Agent from
any such loss or damage. The provisions of SECTIONS 3.4, 5.5, 5.9 and this
SECTION 6.2.4 and all obligations of Borrowers to indemnify Administrative Agent
or any Lender pursuant to this Agreement or any of the other Loan Documents,
shall in all events survive any termination of the Commitment and Full Payment
of the Obligations.
SECTION 7. COLLATERAL
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7.1. GRANT OF SECURITY INTEREST. To secure the prompt payment and
performance of all of the Obligations, each Borrower hereby grants to
Administrative Agent, for the benefit of Secured Parties, a continuing security
interest in and Lien upon all of the following Property and interests in
Property of such Borrower, whether now owned or existing or hereafter created,
acquired or arising and wheresoever located: (i) all Accounts; (ii) all
Instruments, Chattel Paper (including Electronic Chattel Paper), Documents,
Letter-of-Credit Rights and Supporting Obligations, in each case to the extent
arising out of, relating to, or given in exchange or settlement for or to
evidence the obligation to pay any Account; (iii) all General Intangibles that
arise out of or are related to any Account or from which any Account arises;
(iv) all of the Deposit Accounts Collateral; (v) all monies now or at any time
or times hereafter in the possession or under the control of Administrative
Agent or a bailee of Administrative Agent, including any Cash Collateral in any
Cash Collateral Account; (vi) all products and cash and non-cash proceeds of the
foregoing, including proceeds of insurance in respect of any of the foregoing;
(vii) all books and records (including customer lists, files, correspondence,
tapes, computer programs, print-outs and other computer materials and records)
of such Borrower pertaining to any of the foregoing.
7.2. RESERVED.
7.3. RESERVED.
7.4. CERTAIN AFTER-ACQUIRED COLLATERAL. Borrowers shall promptly notify
Administrative Agent in writing upon any Borrower's obtaining any Collateral
after the Restatement Effective Date consisting of Deposit Accounts (other than
Deposit Accounts into which payments with respect to Governmental Receivables
are directly deposited or transferred), Letter-of-Credit Rights or Chattel
Paper, to the extent such Deposit Accounts, Letter-of-Credit Rights or Chattel
Paper arise out of, relate to or are given in exchange or settlement for or to
evidence the obligation to pay any Account, and, upon Administrative Agent's
request, shall promptly execute such documents and do such other acts or things
reasonably deemed appropriate by Administrative Agent to confer upon
Administrative Agent a duly perfected first priority Lien (subject to Permitted
Liens), upon and (to the extent applicable for the perfection of a Lien) control
with respect to such Collateral; and promptly notify Administrative Agent in
writing upon any Borrower's obtaining any Collateral after the Restatement
Effective Date consisting of Documents or Instruments to the extent they arise
out of, relate to or are given in exchange or settlement for or to evidence the
obligation to pay any Account, and, upon Administrative Agent's request, shall
promptly execute such documents and do such other acts or things reasonably
deemed appropriate by Administrative Agent to deliver to it possession of such
Documents as are negotiable and such Instruments, to the extent they arise out
of, relate to or are given in exchange or settlement for or to evidence the
obligation to pay any Account.
7.5. NO ASSUMPTION OF LIABILITY. The security interest granted pursuant to
this Agreement is granted as security only and shall not subject Administrative
Agent or any Lender to, or in any way alter or modify, any obligation or
liability of Borrowers with respect to or arising out of the Collateral.
7.6. LIEN PERFECTION; FURTHER ASSURANCES. Promptly after Administrative
Agent's request therefor, Borrowers shall execute or cause to be executed and
deliver to Administrative Agent such instruments, assignments or other documents
as are necessary under the UCC or other Applicable Law to perfect (or continue
the perfection of) Administrative Agent's Lien upon the Collateral and shall
take such other action as may be requested by Administrative Agent to give
effect to or carry out the intent and purposes of this Agreement. Unless
prohibited by Applicable Law, each Borrower hereby irrevocably authorizes
Administrative Agent to execute and file in any jurisdiction any financing
statement or amendment thereto on such Borrower's behalf, including financing
statements that indicate the Collateral as set forth in this SECTION 7. Each
Borrower also hereby ratifies its authorization for Administrative Agent to have
filed in any jurisdiction any like financing statement or amendment thereto if
filed prior to
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the date hereof. The parties agree that a carbon, photographic or other
reproduction of this Agreement shall be sufficient as a financing statement and
may be filed in any appropriate office in lieu thereof.
SECTION 8. COLLATERAL ADMINISTRATION
8.1. GENERAL PROVISIONS.
8.1.1. Location of Collateral. Collateral shall at all times be kept
by Borrowers at one or more of the business locations of Borrowers set forth in
SCHEDULE 9.1.6 hereto and shall not be moved therefrom, without the prior
written approval of Administrative Agent, except that in the absence of an Event
of Default and acceleration of the maturity of the Obligations in consequence
thereof, Borrowers may move any record relating to any Collateral to a location
in the United States other than those shown on SCHEDULE 9.1.6 hereto so long as
Borrowers have given Administrative Agent at least 5 days prior written notice
of such new location and prior to moving to such location there have been filed
any UCC-1 financing statements or other appropriate documentation necessary to
perfect or continue perfection of Administrative Agent's first priority Liens
subject to Permitted Liens with respect to such Collateral.
8.1.2. Insurance of Collateral; Condemnation Proceeds. Borrowers
shall, upon request by Administrative Agent, deliver the originals or certified
copies of all insurance policies to Administrative Agent with certificates of
insurance reasonably satisfactory to Administrative Agent naming Administrative
Agent as an additional insured with respect to Borrowers' general liability
insurance. If any Borrower fails to provide and pay for such insurance,
Administrative Agent may, at its option, but shall not be required to, procure
the same and charge Borrowers therefor. Each Borrower agrees to deliver to
Administrative Agent, promptly as rendered, true copies of all reports made in
any reporting forms to insurance companies (other than reports with respect to
professional liability insurance).
8.1.3. Protection of Collateral. All expenses of protecting, storing,
warehousing, insuring, handling, maintaining and shipping any Collateral, all
Taxes imposed under any Applicable Law on any of the Collateral or in respect of
the sale thereof, and all other payments required to be made by Administrative
Agent to any Person to realize upon any Collateral shall be borne and paid by
Borrowers. Administrative Agent shall not be liable or responsible in any way
for the safekeeping of any of the Collateral or for any loss or damage thereto
(except for reasonable care in the custody thereof while any Collateral is in
Administrative Agent's actual possession) or for any diminution in the value
thereof, or for any act or default of any warehouseman, carrier, forwarding
agency, or other Person whomsoever, but the same shall be at Borrowers' sole
risk.
8.1.4. Defense of Title to Collateral. Each Borrower shall at all
times defend such Borrower's title to the Collateral and Administrative Agent's
Liens therein against all Persons and all claims and demands whatsoever other
than Permitted Liens and Permitted Asset Dispositions.
8.2. ADMINISTRATION OF ACCOUNTS.
8.2.1. Records and Schedules of Accounts. Each Borrower shall keep
accurate and complete records of its Accounts and all payments and collections
thereon. Each Borrower shall also provide to Administrative Agent on or before
the 25th day of each month, a detailed aged trial balance of all Accounts
existing as of the last day of the preceding month, specifying the names, face
value, dates of invoices and due dates for each Account Debtor obligated on an
Account so listed ("Schedule of Accounts"), and, upon Administrative Agent's
request therefor, copies of all documents, including repayment histories and
present status reports relating to the Accounts so scheduled and such other
matters and information relating to the status of then existing Accounts as
Administrative Agent
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shall reasonably request. In addition, at any time that there are Revolver Loans
outstanding or LC Obligations that have not been Cash Collateralized exceed
$2,000,000, if an Account in the face amount in excess of $1,000,000 ceases to
be an Eligible Account in whole or in part, Borrowers shall notify
Administrative Agent of such occurrence promptly (and in any event within 7
Business Days) after any Borrower's having obtained knowledge of such occurrence
and the Borrowing Base shall thereupon be adjusted to reflect such occurrence.
To the extent permitted by Applicable Law, each Borrower shall deliver to
Administrative Agent copies of invoices or invoice registers related to all of
its Accounts.
8.2.2. Discounts, Disputes and Returns. At any time that there are
Revolver Loans outstanding or LC Obligations that have not been Cash
Collateralized exceed $2,000,000, if any Borrower grants any discounts,
allowances or credits on an Eligible Account in excess of 5% of the amount of
such Account that are not shown on the face of the invoice for the Eligible
Account involved, such Borrower shall report such discounts, allowances or
credits, as the case may be, to Administrative Agent as part of the next
required Schedule of Accounts. At any time that there are Revolver Loans
outstanding or LC Obligations that have not been Cash Collateralized exceed
$2,000,000, if any amounts due and owing in excess of $750,000 are in dispute
between any Borrower and any Account Debtor, such Borrower shall provide
Administrative Agent with written notice thereof at the time of submission of
the next Schedule of Accounts.
8.2.3. Taxes. If an Account of any Borrower includes a charge for any
Taxes payable to any Governmental Authority, Administrative Agent is authorized,
in its discretion, to pay the amount thereof to the proper taxing authority for
the account of such Borrower and to charge Borrowers therefor; provided,
however, that neither Administrative Agent nor Lenders shall be liable for any
Taxes that may be due by Borrowers.
8.2.4. Account Verification. Whether or not a Default or an Event of
Default exists, Administrative Agent shall have the right at any time, in the
name of Administrative Agent, any designee of Administrative Agent or any
Borrower to verify the validity, amount or any other matter relating to any
Wholesale Receivable of such Borrower by mail, telephone, telegraph or
otherwise. Borrowers shall cooperate fully with Administrative Agent in an
effort to facilitate and promptly conclude any such verification process.
8.2.5. MAINTENANCE OF DOMINION ACCOUNT.
(i) Borrowers shall establish and maintain a system of cash
management that is acceptable to Agent with BofA or such other bank or
banks as may be selected by Borrowers and be reasonably acceptable to
Administrative Agent. Such system of cash management shall include (i) a
lockbox (or lockboxes), and related Deposit Account (or Deposit Accounts),
for remittance and deposit (including by way of electronic funds transfer)
of collections or payments with respect to Wholesale Receivables (each a
"Wholesale Collection Account"), (ii) a Deposit Account (or Deposit
Accounts) into which collections and payments with respect to Retail
Receivables (including Governmental Receivables) are deposited or remitted
by electronic funds transfer or otherwise (each a "Retail Collection
Account"), (iii) a Deposit Account that constitutes a "concentration
account" (the "Concentration Account") into which collected funds from the
Collection Accounts (other than amounts payable to physicians pursuant to
PSAs) shall be transferred within 7 Business Days of receipt thereof and
(iv) such other Deposit Accounts and/or lockboxes as Borrowers shall deem
to be necessary or appropriate to conduct their business operations.
Borrowers shall have access to the funds that are deposited in the
foregoing Deposit Accounts, provided that (a) Borrowers shall not deposit
proceeds of Property constituting collateral security for the Senior Notes
therein, (b) Borrowers shall not deposit the proceeds of any Collateral
into any Deposit Account maintained for or in connection
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with the Senior Notes or into which the proceeds of collateral security for
the Senior Notes are, or are intended to be, deposited and (c) the
provisions of SECTION 8.2.5(II) shall control after the occurrence of a
Restrictive Trigger Event.
(ii) If a Restrictive Trigger Event occurs at any time, then all
monies in the Concentration Account and in each Wholesale Collection
Account shall be deposited each day in the Payment Account and applied to
the Obligations as determined by Administrative Agent in accordance with
this Agreement. If thereafter, a Restrictive Trigger Event does not exist
during any period of 90 consecutive days, then as soon as practicable, but
in any event within 5 Business Days, Administrative Agent will permit
Borrowers to access the monies in the Concentration Account and in each
Wholesale Collection Account for use as provided in SECTIONS 2.1.3 and
8.2.5(I) hereof.
8.2.6. Collection of Accounts and Proceeds of Collateral. To expedite
collection of Accounts, each Borrower shall endeavor in the first instance to
make collection of such Borrower's Accounts for Administrative Agent and Lenders
and, in connection therewith, shall use commercially reasonable efforts to keep
in full force and effect any Supporting Obligation or collateral security
relating to each such Account. All Payment Items received by any Borrower in
respect of its Accounts, together with the proceeds of any other Collateral,
shall be held by such Borrower as trustee of an express trust for Administrative
Agent's and Lenders' benefit; Borrowers shall promptly, and in any event no
later than the seventh Business Day after the date of receipt thereof, deposit
the same in kind in the Collection Accounts; and Administrative Agent may remit
such proceeds to Lenders for application to the Obligations in the manner
authorized by this Agreement. Administrative Agent retains the right at all
times that an Event of Default exists to notify Account Debtors on Wholesale
Receivables of any Borrower that Wholesale Receivables have been assigned to
Administrative Agent, to collect Wholesale Receivables directly in its own name
(and, in connection therewith, and to charge to Borrowers the collection costs
and expenses incurred by Administrative Agent, including reasonable attorneys'
fees). At any time an Event of Default exists, Administrative Agent shall have
the right to settle or adjust all disputes and claims directly with the Account
Debtor on Wholesale Receivables and to compromise the amount or extend the time
for payment of any Wholesale Receivables upon such terms and conditions as
Administrative Agent may deem advisable, and to charge the deficiencies, costs
and expenses thereof, including attorneys' fees, to Borrowers.
8.3. ADMINISTRATION OF DEPOSIT ACCOUNTS. Each Borrower represents that, as
of the Restatement Effective Date, SCHEDULE 8.3 (as the same may be amended or
supplemented from time to time) sets forth all of the Deposit Accounts
maintained by each Borrower that arise out or relate to the Accounts, including
Deposit Accounts into which all Payment Items relating to any Collateral are
deposited; a Borrower is the sole account holder of each such Deposit Account
and is not aware of any Person (other than Administrative Agent) having either
dominion or control (within the meaning of Section 9-104 of the UCC) over any
such Deposit Account or any property deposited therein (other than any such
control that has been released or terminated on or before the Restatement
Effective Date and control arising by operation of law in favor the depository
bank in which such Deposit Account is maintained); and each Borrower has taken
all actions required to establish Administrative Agent's "control" (within the
meaning of Section 9-104 of the UCC) over the Concentration Account, the
Investment Accounts and any other Deposit Account that relates to the Accounts
(other than any Deposit Account specially and exclusively used for payroll,
payroll taxes and other employee wage and benefit payments to or for the benefit
of such Borrower's employees or into which payments with respect to Governmental
Receivables are directly deposited or transferred). Each Borrower shall promptly
notify Administrative Agent of any additional Deposit Account of the type
described above in this SECTION 8.3 opened and any Deposit Account of the type
described above in SECTION 8.3 that is closed, and will amend SCHEDULE 8.3 to
reflect such addition or deletion.
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8.4. BORROWING BASE CERTIFICATES. Borrowers shall deliver to Administrative
Agent (and Administrative Agent shall, on request from a Lender, promptly
deliver to such Lender) a Borrowing Base Certificate: (a) on the Restatement
Effective Date; (b) if there are no Revolver Loans outstanding and the LC
Obligations that have not been Cash Collateralized do not exceed $2,000,000, on
the 25th day of the month following the end of each Fiscal Quarter, prepared as
of the last day of such Fiscal Quarter, or if there are Revolver Loans
outstanding or LC Obligations that have not been Cash Collateralized exceed
$2,000,000, on the Business Day that the initial Revolver Loan is requested, or
deemed requested by Borrower or the LC Obligations that are not Cash
Collateralized initially exceed $2,000,000, and on the 25th day of each month
thereafter, prepared as of the last day of the previous month; (c) if there are
Revolver Loans outstanding or the LC Obligations that have not been Cash
Collateralized exceed $2,000,000, on any Business Day on which Borrowers shall
dispose of any Eligible Accounts having a face amount in excess of $250,000 to
the extent permitted pursuant to clause (ii)(k) of the definition of Permitted
Asset Disposition; (d) during the continuance of an Event of Default, at such
other times as Administrative Agent may request, provided that Borrowers may
deliver Borrowing Base Certificates more frequently at their option. All
calculations of Availability in connection with any Borrowing Base Certificate
shall originally be made by Borrowers and certified by an authorized officer to
Administrative Agent, provided that Administrative Agent shall have the right to
review and adjust, in the exercise of its Credit Judgment, any such calculation
to the extent that such calculation is not in accordance with this Agreement or
does not accurately reflect the amount of the Availability Reserve. In no event
shall the Borrowing Base on any date be deemed to exceed the amount of the
Borrowing Base shown on the Borrowing Base Certificate most recently received by
Administrative Agent, as the calculation in such Borrowing Base Certificate may
be adjusted from time to time by Administrative Agent as herein authorized.
SECTION 9. REPRESENTATIONS AND WARRANTIES
9.1. GENERAL REPRESENTATIONS AND WARRANTIES. To induce Administrative Agent
and Lenders to enter into this Agreement and to make available the Commitments,
each Borrower warrants and represents to Administrative Agent and Lenders that:
9.1.1. Organization and Qualification. Each Borrower and each of its
Subsidiaries is an entity duly organized, validly existing and in good standing
under the laws of the jurisdiction of its organization. Each Borrower and each
of its Subsidiaries is duly qualified and is authorized to do business and is in
good standing as a foreign corporation in all states and jurisdictions in which
the failure of such Borrower or Subsidiary, as the case may be, to be so
qualified would reasonably be expected to have a Material Adverse Effect.
9.1.2. Power and Authority. Each Borrower and each Guarantor is duly
authorized and empowered to enter into, execute, deliver and perform each of the
Loan Documents to which it is a party. The execution, delivery and performance
of this Agreement and each of the other Loan Documents have been duly authorized
by all necessary action and do not and will not (i) require any consent or
approval of any of the holders of the Equity Interests of any Borrower or any of
its Subsidiary other than those obtained on or prior to the date hereof; (ii)
contravene the Organic Documents of any Borrower or any of its Subsidiaries;
(iii) violate, or cause any Borrower or any of its Subsidiaries to be in default
under, any provision of any Applicable Law, order, writ, judgment, injunction,
decree, determination or award in effect having applicability to any Borrower or
any of its Subsidiaries; (iv) result in a breach of or constitute a default
under any indenture or loan or credit agreement or any other agreement, lease or
instrument to which any Borrower or any of its Subsidiaries is a party or by
which it or its Properties may be bound or affected; or (v) result in, or
require, the creation or imposition of any Lien (other than Permitted Liens)
upon or with respect to any of the Properties now owned or hereafter acquired by
any
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Borrower or any of its Subsidiaries, except in the case of clauses (iii), (iv)
or (v) of this SECTION 9.1.2 as would not reasonably be expected to have a
Material Adverse Effect.
9.1.3. Legally Enforceable Agreement. The Loan Documents when
delivered will be, legal, valid and binding obligations of each Borrower and
each of its Subsidiaries signatories thereto enforceable against them in
accordance with the respective terms of such Loan Documents, except as the
enforceability thereof may be limited by bankruptcy, insolvency or other similar
laws of general application affecting the enforcement of creditors' rights.
9.1.4. Capital Structure. As of the date hereof, SCHEDULE 9.1.4 hereto
states (i) the correct name of each Borrower, its jurisdiction of incorporation
and the percentage of its Equity Interests having voting powers owned by each
Person. Each Borrower has good title to all of the shares it purports to own of
the Equity Interests of each of its Subsidiaries, free and clear in each case of
any Lien other than Permitted Liens. All such Equity Interests have been duly
issued and are fully paid and non-assessable.
9.1.5. Corporate Names. To the best of its knowledge, during the
5-year period preceding the date of this Agreement, no Borrower nor any of its
Subsidiaries has been known as or used any corporate, fictitious or trade names
except those listed on SCHEDULE 9.1.5 hereto. To the best of its knowledge,
except as set forth on SCHEDULE 9.1.5, no Borrower nor any of its Subsidiaries
has been the surviving corporation of a merger or consolidation or acquired all
or substantially all of the assets of any Person.
9.1.6. Business Locations; Agent for Process. As of the date hereof,
the chief executive office and other places of business of each Borrower and its
Subsidiaries are as listed on SCHEDULE 9.1.6 hereto.
9.1.7. Title to Properties; Priority of Liens. Each Borrower and each
of its Subsidiaries has good title to all of its personal Property, including
all Property reflected in the financial statements referred to in SECTION 9.1.9
or delivered pursuant to SECTION 10.1.3, except as could not be reasonably be
expected to have a Material Adverse Effect, in each case free and clear of all
Liens except Permitted Liens. Each Borrower has paid or discharged, and has
caused each of its Subsidiaries to pay and discharge, all material lawful claims
which, if unpaid, might become a Lien against any Properties of such Borrower or
any such Subsidiary that is not a Permitted Lien. The Liens granted to
Administrative Agent pursuant to this Agreement and the other Security Documents
are duly perfected, first priority Liens, subject only to those Permitted Liens
that are expressly permitted by the terms of this Agreement to have priority
over the Liens of Administrative Agent.
9.1.8. Wholesale Receivables and Retail Receivables.
(i) Wholesale Receivables. Administrative Agent may rely, in
determining which Wholesale Receivables are Eligible Wholesale Receivables,
on all statements and representations made by Borrowers with respect to any
Account. With respect to each Eligible Wholesale Receivable, each Borrower
warrants that:
(a) it is genuine and in all respects what it purports to be, and
it is not evidenced by a judgment;
(b) it arises out of a completed, bona fide sale and delivery of
goods or rendition of services by a Borrower in the Ordinary Course of
Business and substantially in accordance with the terms and conditions
of all purchase orders, contracts
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or other documents relating thereto and forming a part of the contract
between a Borrower and the Account Debtor;
(c) it is for a sum certain maturing as stated in the duplicate
invoice covering such sale or rendition of services, a copy of which
has been furnished or is available to Administrative Agent on request;
(d) such Account, and Administrative Agent's security interest
therein, is not, subject to any offset, Lien, deduction, defense,
dispute, counterclaim or any other adverse condition except for
disputes and except for offsets or deductions contemplated by the
invoice evidencing an Account or arising in the Ordinary Course of
Business and disclosed to Administrative Agent, each such Account is
absolutely owing to a Borrower and is not contingent in any respect or
for any reason;
(e) the contract under which such Account arose does not
condition or restrict a Borrower's right to assign to Administrative
Agent the right to payment thereunder unless such Borrower has
obtained the Account Debtor's consent to such collateral assignment or
complied with any conditions to such assignment (regardless of whether
under the UCC or other Applicable Law any such restrictions are
ineffective to prevent the grant of a Lien upon such Account in favor
of Administrative Agent);
(f) such Borrower has not made any agreement with any Account
Debtor thereunder for any extension, compromise, settlement or
modification of any such Account or any deduction therefrom, except
discounts or allowances which are granted by a Borrower in the
Ordinary Course of Business and which are reflected in the calculation
of the net amount of each respective invoice related thereto and are
reflected in the Schedules of Accounts submitted to Administrative
Agent pursuant to SECTION 8.2.1;
(g) to the best of such Borrower's knowledge, there are no facts,
events or occurrences which are reasonably likely to impair the
validity or enforceability of such Account or reduce the amount
payable thereunder from the face amount of the invoice and statements
delivered to Administrative Agent with respect thereto;
(h) to the best of such Borrower's knowledge, the Account Debtor
thereunder (1) had the capacity to contract at the time any contract
or other document giving rise to the Account was executed and (2) is
Solvent; and
(i) to the best of such Borrower's knowledge, there are no
proceedings or actions which are threatened or pending against any
Account Debtor thereunder and which are reasonably likely to result in
any material adverse change in such Account Debtor's financial
condition or the collectibility of such Account.
(ii) Retail Receivables. Administrative Agent may rely, in
determining which Retail Receivables are Eligible Retail Receivables, on
all statements and representations made by Borrowers with respect to any
Retail Receivable. With respect to each Eligible Retail Receivable, each
Borrower warrants that:
(a) all information relating to such Retail Receivable that has
been delivered to Administrative Agent is true and correct in all
material respects. With respect to each such Retail Receivable, such
Retail Receivable has been billed after the date the services
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or goods giving rise to such Retail Receivable were rendered or
provided, as applicable, all information set forth in the bill and
supporting claim documents is true, complete and correct in all
material respects and each bill contains an express direction
requiring the Third Party Payor to remit payments as set forth in
SECTION 8.2.6;
(b) such Retail Receivable is payable in an amount not less than
its Net Realizable Value by the Third Party Payor identified by
Borrowers as the payor thereon and is recognized as such by such Third
Party Payor. There is no payor on such Retail Receivable other than
the Third Party Payor identified by Borrower as the payor primarily
liable on such Retail Receivable;
(c) no such Retail Receivable (1) requires the approval of any
Person for the grant of a Lien in such Retail Receivable to
Administrative Agent hereunder or (2) is past the statutory limit for
collection applicable to the Third Party Payor;
(d) the patient received the services constituting the basis of
such Retail Receivable in the Ordinary Course of Business;
(e) the fees and charges charged by such Borrower for the
services constituting the basis for such Account were when rendered
consistent with (1) the usual, customary and reasonable fees charged
by such Borrower or (2) negotiated fee contracts with, or imposed fee
schedules from, the applicable Third Party Payor;
(f) the Third Party Payor with respect to such Retail Receivable
is, to such Borrower's actual knowledge but without inquiry, located
in the United States and is (1) a Person which in the Ordinary Course
of Business agrees to pay for healthcare services received by
individuals, including commercial insurance companies and non-profit
insurance companies issuing health or other types of insurance,
employers or unions, self-insured healthcare organizations, preferred
provider organizations and health insured, prepaid maintenance
organizations, (2) a state, an agency or instrumentality of a state or
a political subdivision of a state or (3) the United States or an
agency or instrumentality of the United States;
(g) if requested by Administrative Agent, a copy of each related
Provider Agreement to which a Borrower is a party has been delivered
to Administrative Agent unless any such delivery is prohibited by the
terms of the Provider Agreement or by Applicable Law; and
(h) neither such Retail Receivable nor the related Provider
Agreement contravenes any material Applicable Laws applicable thereto
and no Borrower is in violation of any such Applicable Law.
9.1.9. Financial Statements; Fiscal Year. The Consolidated balance
sheet of Borrowers and such other Persons described therein as of March 31,
2005, and the related statements of income, changes in stockholder's equity, and
changes in financial position for the periods ended on such dates, have been
prepared in accordance with GAAP, and present fairly in all material respects
the Consolidated financial positions of Borrowers and such Persons at such dates
and the results of Borrowers' operations for such periods. Since March 31, 2005,
there has been no material adverse change in the Consolidated financial
condition of Borrowers and such other Persons as shown on the Consolidated
balance sheet as of such date, except as set forth in the form 8-K filed
September 1, 2005 and the form 8-K filed September 16, 2005 filed by Parent with
the SEC.
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9.1.10. Full Disclosure. The financial statements referred to in
SECTION 9.1.9 do not contain any untrue statement of a material fact and neither
this Agreement nor any other written statement, when taken together, contains or
omits any material fact necessary to make the statements contained herein or
therein not materially misleading. There is no fact or circumstance in existence
on the date hereof which any Borrower has failed to disclose to Administrative
Agent in writing that would reasonably be expected to have a Material Adverse
Effect.
9.1.11. Solvent Financial Condition. Each Borrower and its
Subsidiaries is now Solvent and, after giving effect to the Loans to be made
hereunder, the LC Obligations to be incurred in connection herewith and the
consummation of the other transactions described in the Loan Documents, will be
Solvent.
9.1.12. Surety Obligations. As of the date hereof, no Borrower nor any
of its Subsidiaries is obligated as surety or indemnitor under any surety,
performance or similar bond issued to assure payment, performance or completion
of performance of any undertaking or obligation of any Person.
9.1.13. Taxes. The FEIN of each of each Borrower and each of its
Subsidiaries is as shown on SCHEDULE 9.1.13. Each Borrower and each of its
Subsidiaries has filed all material federal, state and local tax returns and
other material reports it is required by law to file and has paid, or made
provision for the payment of, all material Taxes upon it, its income and
Properties as and when such Taxes are due and payable, except to the extent
being Properly Contested. The provision for Taxes on the books of each Borrower
and each of its Subsidiaries are adequate in accordance with GAAP or all years
not closed by applicable statutes, and for its current Fiscal Year.
9.1.14. Intellectual Property. Each Borrower and each of its
Subsidiaries owns or has the lawful right to use all Intellectual Property
necessary for the present and planned future conduct of its business without any
conflict with the rights of others, except in each case as could not reasonably
be expected to have an Material Adverse Effect.
9.1.15. Governmental Approvals. Each Borrower and each of its
Subsidiaries has, and is in good standing with respect to, all Governmental
Approvals necessary to continue to conduct its business as heretofore or
proposed to be conducted by it and to own or lease and operate its Properties as
now owned or leased by it, except in each case as could not reasonably be
expected to have a Material Adverse Effect.
9.1.16. Compliance with Laws. Each Borrower and each of its
Subsidiaries has duly complied with, and its Properties, business operations and
leaseholds are in compliance in all material respects with, the provisions of
all Applicable Law, including all Healthcare Laws (except to the extent that any
such noncompliance with Applicable Law could not reasonably be expected to have
a Material Adverse Effect). Without limiting the generality of the foregoing,
except to the extent that any failure of Borrower or any of its Subsidiaries to
comply with an Applicable Law could not reasonably be expected to have a
Material Adverse Effect:
(i) neither any Borrower nor any of the Subsidiaries is engaged
in or has engaged in any course of conduct that could subject any of their
respective Properties to any Lien, seizure or other forfeiture under any
criminal law, racketeer-influenced and corrupt organizations law, civil or
criminal, or other similar laws; and
(ii) neither any Borrower nor any of the Subsidiaries has engaged
in any activities that are prohibited under any Medicaid Regulations or
Medicare Regulations, or
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any related state or local statutes or regulations, or which are prohibited
by binding rules of professional conduct, including the following: (a)
knowingly and willfully making or causing to be made a false statement or
representation of a material fact in any application for any benefit or
payment; (b) knowingly and willfully making or causing to be made a false
statement or representation of a material fact for use in determining
rights to any benefit or payment; (c) failing to disclose knowledge by a
claimant of the occurrence of any event affecting the initial or continued
right to any benefit or payment on its own behalf or on behalf of another
Person, with intent to secure such benefit or payment fraudulently; (d)
knowingly and willfully soliciting or receiving any remuneration (including
any kickback, bribe or rebate), directly or indirectly, overtly or
covertly, in cash or in kind, or offering to pay such remuneration (1) in
return for referring an individual to a Person for the furnishing or
arranging for the furnishing of any item or service for which payment may
be made in whole or in part by or pursuant to any Medicare Regulations, any
Medicaid Regulations or any other Applicable Law (including any
Anti-Kickback Statutes) relating to Third Party Payors or (2) in return for
purchasing, leasing or ordering or arranging for or recommending the
purchasing, leasing or ordering of any good, facility, service or item for
which payment may be made in whole or in part by or pursuant to any
Medicare Regulations, Medicaid Regulations or other Applicable Law relating
to Third Party Payors.
9.1.17. Burdensome Contracts. No Borrower nor any of its Subsidiaries
is a party or subject to any contract, agreement, or charter or other corporate
restriction, which has or could be reasonably expected to have a Material
Adverse Effect.
9.1.18. Litigation. Except as set forth on SCHEDULE 9.1.18, there are
no actions, suits, proceedings or investigations pending or, to the knowledge of
any Borrower, threatened on the date hereof against or affecting any Borrower or
any of its Subsidiaries, or the business, operations, Properties, prospects,
profits or condition of any Borrower or any of its Subsidiaries, (i) which
relate to any of the Loan Documents or any of the transactions contemplated
thereby or (ii) which could reasonably be expected to have a Material Adverse
Effect. To the knowledge of each Borrower, no Borrower nor any of its
Subsidiaries is in default on the date hereof with respect to any order, writ,
injunction, judgment, decree or rule of any court, Governmental Authority or
arbitration board or tribunal that could reasonably be expected to have a
Material Adverse Effect..
9.1.19. No Defaults. No event has occurred and no condition exists
which would, upon or immediately after the execution and delivery of this
Agreement or any Borrower's performance hereunder, constitute a Default or an
Event of Default.
9.1.20. Reserved.
9.1.21. ERISA. Except as disclosed on SCHEDULE 9.1.21, no Borrower nor
any of its Subsidiaries has any Plan on the date hereof. Each Borrower and each
of its Subsidiaries is in material compliance with the requirements of ERISA and
the regulations promulgated thereunder with respect to each Plan. No fact or
situation that is reasonably likely to result in a Material Adverse Effect
exists in connection with any Plan. No Borrower nor any of its Subsidiaries has
any withdrawal liability in connection with a Multiemployer Plan.
9.1.22. Labor Relations. Except as described on SCHEDULE 9.1.22, no
Borrower nor any of its Subsidiaries is on the date hereof a party to or bound
by any collective bargaining agreement. On the date hereof, there are no
material grievances, disputes or controversies with any union or any other
organization of any Borrower's or any Subsidiary's employees, or, to any
Borrower's knowledge, any
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threats of strikes, work stoppages or any asserted pending demands for
collective bargaining by any union or organization.
9.1.23. Not a Regulated Entity. No Obligor is (i) an "investment
company" or a "person directly or indirectly controlled by or acting on behalf
of an investment company" within the meaning of the Investment Company Act of
1940; (ii) a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company," within the meaning of the Public Utility Holding Company
Act of 1935; or (iii) subject to regulation under the Federal Power Act, the
Interstate Commerce Act, any public utilities code or any other Applicable Law
regarding its authority to incur Debt.
9.1.24. Margin Stock. No Borrower nor any of its Subsidiaries 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.
9.1.25. Anti-Terrorism Laws.
(i) General. No Borrower nor any of its Affiliates is in
violation of any Anti-Terrorism Law or engages in or conspires to engage in
any transaction that evades or avoids, or has the purpose of evading or
avoiding, or attempts to violate, any of the prohibitions set forth in any
Anti-Terrorism Law.
(ii) Executive Order No. 13224.
(a) No Borrower nor, to the best of its knowledge, any of
its Affiliates is any of the following (each a "Blocked Person"): (1)
a Person that is listed in the annex to, or is otherwise subject to
the provisions of, Executive Order No. 13224; (2) a Person owned or
controlled by, or acting for or on behalf of, any Person that is
listed in the annex to, or is otherwise subject to the provisions of,
Executive Order No. 13224; (3) a Person or entity with which any bank
or other financial institution is prohibited from dealing or otherwise
engaging in any transaction by any Anti-Terrorism Law; (4) a Person or
entity that commits, threatens or conspires to commit or supports
"terrorism" as defined in Executive Order No. 13224; (5) a Person or
entity that is named as a "specially designated national" on the most
current list published by the U.S. Treasury Department Office of
Foreign Asset Control ("OFAC") at its official website or any
replacement website or other replacement official publication of such
list; (6) a Person or entity who is affiliated with a Person or entity
listed above; or (7) an agency of the government of, an organization
directly or indirectly controlled by, or a Person resident in, a
country on any official list maintained by OFAC.
(b) No Borrower nor, to the best of its knowledge, any of
its Affiliates (1) conducts any business or engages in making or
receiving any contribution of funds, goods or services to or for the
benefit of any Blocked Person, (2) has any of its assets in a Blocked
Person, (3) deals in, or otherwise engages in any transaction relating
to, any Property or interests in Property blocked pursuant to
Executive Order No. 13224, or (4) derives any of its operating income
from investments in or transactions with a Blocked Person.
9.1.26. Payable Practices. No Borrower nor any of its Subsidiaries has
made any material change in its historical accounts payable practices from those
in effect immediately prior to the Restatement Effective Date.
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9.1.27. Not the Holder of Plan Assets. No Borrower is an entity deemed
to hold "plan assets" within the meaning of 29 C.F.R. Section 2510.3-101 of an
"employee benefit plan" (as defined in Section 3(3) of ERISA) that is subject to
Title I of ERISA or any "plan" (within the meaning of Section 4975 of the
Internal Revenue Code), and neither the execution of this Agreement nor the
funding of any Loans gives rise to a prohibited transaction within the meaning
of Section 406 of ERISA or Section 4975 of the Internal Revenue Code.
9.1.28. Reimbursement from Third Party Payors. The Accounts, after
giving effect to the Contractual Adjustment Allowance in effect from time to
time, have been and will continue to be adjusted to reflect reimbursement
policies of Third Party Payors. In particular, Accounts relating to such Third
Party Payors do not and will not exceed amounts any obligee is entitled to
receive under any capitation arrangement, fee schedule, discount formula,
cost-based reimbursement or other adjustment or limitation to its usual charges.
9.1.29. Licensing, Accreditation and Other Governmental Approvals.
Except to the extent that the failure to have or maintain the same is not
reasonably likely to have a Material Adverse Effect, each Borrower and each of
the Subsidiaries has, and is in good standing with respect to, all Governmental
Approvals necessary to continue to conduct its business as heretofore or
proposed to be conducted by it and to own or lease and operate its Properties as
now owned or leased by it. Except to the extent that the same is not reasonably
likely to have a Material Adverse Effect, each Borrower and each of the
Subsidiaries has, to the extent applicable: (i) obtained (or been duly assigned)
all required certificates of need or determinations of need as required by the
relevant Governmental Authority for the acquisition, construction, expansion of,
investment in or operation of its businesses as currently operated; (ii)
obtained and maintains in good standing all required licenses; (iii) to the
extent prudent and customary in the industry in which such Person is engaged,
obtained and maintains accreditation from all generally recognized accrediting
agencies; (iv) obtained and maintains Medicaid Certification and Medicare
Certification; and (v) entered into and maintains in good standing such Person's
Medicare Provider Agreement and Medicaid Provider Agreement.
9.2. REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Each representation
and warranty contained in this Agreement and the other Loan Documents shall be
deemed to be made on the Restatement Effective Date and reaffirmed by each
Borrower on each day that Borrowers request or are deemed to have requested any
Loan, Letter of Credit or other extension of credit hereunder, except for
changes in the nature of a Borrower's or, if applicable, any Subsidiary's
business or operations that may occur after the date hereof in the Ordinary
Course of Business so long as Administrative Agent has consented to such changes
or such changes are not violative of any provision of this Agreement.
Notwithstanding the foregoing, representations and warranties which by their
terms are applicable only as of a specific date shall be deemed made only at and
as of such date.
9.3. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations and
warranties of Borrowers contained in this Agreement or any of the other Loan
Documents shall survive the execution, delivery and acceptance thereof by
Administrative Agent, Lenders and the parties thereto and the closing of the
transactions described therein or related thereto.
SECTION 10. COVENANTS AND CONTINUING AGREEMENTS
10.1. AFFIRMATIVE COVENANTS. For so long as there are any Commitments
outstanding and thereafter until Full Payment of the Obligations (other than
contingent indemnification obligations for which no claim has been made), each
Borrower covenants that it shall and shall cause each Subsidiary to:
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10.1.1. Visits and Inspections. Permit representatives of
Administrative Agent, up to 2 times per Loan Year unless an Event of Default
exists, but only during normal business hours and (except when an Event of
Default exists) upon reasonable prior notice to a Borrower, to visit the
Properties of such Borrower and each of its Subsidiaries to inspect, audit and
make extracts from such Borrower's and each Subsidiary's books and records, and
discuss with its officers, its employees and its independent accountants, such
Borrower's and each Subsidiary's business, financial condition, business
prospects and results of operations. If an Event of Default exists, there shall
be no limit on the number of such visits Administrative Agent and/or Lenders
shall be permitted to undertake. Representatives of each Lender shall be
authorized to accompany Administrative Agent on each such visit and inspection
and to participate with Administrative Agent therein, but at their own expense,
unless an Event of Default exists. Neither Administrative Agent nor any Lender
shall have any duty to make any such inspection and shall not incur any
liability by reason of its failure to conduct or delay in conducting any such
inspection. Administrative Agent and Lenders shall comply with all applicable
privacy laws in connection with such investigations and/or audits.
10.1.2. Notices. Notify Administrative Agent and Lenders in writing,
promptly after a Borrower's obtaining knowledge thereof, of: (i) of the
commencement of any litigation affecting any Obligor, whether or not the claims
asserted in such litigation are considered by Borrowers to be covered by
insurance, and of the institution of any administrative proceeding, in each case
to the extent that such litigation or proceeding could reasonably be expected to
have a Material Adverse Effect, provided that notice shall not be required to be
given to the extent prohibited by Applicable Law; (ii) any material labor
dispute to which any Obligor may become a party, any pending or threatened
strikes or walkouts relating to any of its plants or other facilities, and the
expiration of any labor contract to which it is a party or by which it is bound;
(iii) any material default by any Obligor under, or termination of, any note,
indenture, loan agreement, mortgage, lease, deed, guaranty or other similar
agreement relating to any Debt of such Obligor exceeding $1,000,000; (iv) the
existence of any Default or Event of Default; (v) any judgment against any
Obligor in an amount exceeding $1,000,000; (vi) any violation or asserted
violation by any Borrower of any Applicable Law (including Healthcare Laws,
ERISA, OSHA, FLSA, or any Environmental Laws) which could reasonably be expected
to have a Material Adverse Effect; (vii) any Environmental Release by an Obligor
or on any Property owned or occupied by an Obligor; (viii) the discharge of
Borrowers' independent accountants or any withdrawal of resignation by such
independent accountants from their acting in such capacity; (ix) any
investigation of any Obligor by any Governmental Authority (including the SEC or
the U.S. Department of Justice); (x) any notice received by an Obligor from HHS,
CMS or any other federal or state agency relating to the suspension or
termination of an Obligor's participation in the Medicare or Medicaid program or
of payments to such Obligor thereunder; and (xi) the incurrence of Debt of the
type permitted pursuant to SECTION 10.2.3(X).
10.1.3. Financial and Other Information. Keep adequate records and
books of account with respect to its business activities in which proper entries
are made reflecting all material financial transactions that are necessary to
permit preparation of financial statements in accordance with GAAP; and cause to
be prepared and furnished to Administrative Agent and Lenders the following (all
to be prepared in accordance with GAAP applied on a consistent basis, unless
Borrowers' certified public accountants concur in any change therein, such
change is disclosed to Administrative Agent and is consistent with GAAP
(provided, that for purposes of determining compliance with the covenant
contained in SECTION 10.3, all accounting terms employed herein shall be
interpreted and all accounting determinations hereunder shall be made in
accordance with GAAP as in effect on the Restatement Effective Date and applied
on a basis consistent with the application used in the financial statements
referred to in Section 9.1.9):
(i) as soon as available, and in any event within 120 days after
the close of each Fiscal Year audited balance sheets of Borrowers and their
respective Subsidiaries as of the
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end of such Fiscal Year and the related statements of income, shareholders'
equity and cash flow, on a Consolidated basis, certified without an
Impermissible Qualification by a firm of independent certified public
accountants of recognized national standing selected by Borrowers but
reasonably acceptable to Administrative Agent and setting forth in each
case in comparative form the corresponding Consolidated figures for the
preceding Fiscal Year;
(ii) as soon as available, and in any event within 30 days after
the end of each month hereafter (but within 60 days after the last month in
a Fiscal Year), unaudited balance sheets of Borrowers and its Subsidiaries
as of the end of such month and the related unaudited statements of income
and cash flow for such month and for the portion of Borrowers' Fiscal Year
then elapsed, on a Consolidated basis, setting forth in each case in
comparative form the corresponding figures for the preceding Fiscal Year
and certified by the principal financial officer of Borrowers as prepared
in accordance with GAAP and fairly presenting in all material respects the
Consolidated financial position and results of operations of Borrowers and
their Subsidiaries for such month and year-to-date period subject only to
changes from audit and year-end adjustments and except that such statements
need not contain notes;
(iii) promptly after the sending or filing thereof, as the case
may be, copies of any proxy statements, financial statements or reports
which any Borrower has made generally available to its shareholders; copies
of any regular, periodic and special reports or registration statements or
prospectuses which any Borrower files with the SEC or any Governmental
Authority which may be substituted therefor, or any national securities
exchange; and copies of any press releases or other statements made
available by a Borrower to the public concerning material changes to or
developments in the business of such Borrower;
(iv) promptly after the sending or filing thereof, copies of any
annual report to be filed in accordance with ERISA in connection with each
Plan; and
(v) such other data and information (financial or otherwise) as
Administrative Agent, from time to time, may reasonably request, bearing
upon or related to the Collateral or any Borrower's or Subsidiary's
financial condition or results of operations.
The timely delivery by Borrowers to Administrative Agent of the annual
report on form 10-K for Parent and its Consolidated Subsidiaries shall satisfy
Borrowers' obligations under SECTION 10.1.3(I) above, provided that such form
10-K satisfies all of the requirements of SECTION 10.1.3(I). Concurrently with
the delivery of the financial statements described in clause (i) of this SECTION
10.1.3, Borrowers shall deliver to Administrative Agent a copy of the
accountants' letter to Borrowers' management that is prepared in connection with
such financial statements. Concurrently with the delivery of the financial
statements described in clauses (i) and (ii) of this SECTION 10.1.3, Borrowers
shall cause to be prepared and furnished to Administrative Agent a Compliance
Certificate executed by the chief financial officer of Borrowers.
10.1.4. Off-Site Data Storage. Store duplicate or back-up copies of
Borrowers' billing records, updated daily, at an off-site facility.
10.1.5. Projections. No later than 60 days after the end of each
Fiscal Year of Borrowers, deliver to Administrative Agent the Projections of
Borrowers for the forthcoming Fiscal Year, prepared on a month by month basis.
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10.1.6. Taxes. Pay and discharge all material Taxes prior to the date
on which such Taxes become delinquent or penalties attach thereto, except and to
the extent only that such Taxes are being Properly Contested.
10.1.7. Compliance with Laws. Comply with all Applicable Law,
including ERISA, all Healthcare Laws, all Environmental Laws, FLSA, OSHA,
Anti-Terrorism Laws and all laws, statutes, regulations and ordinances regarding
the collection, payment and deposit of Taxes, and obtain and keep in force any
and all Governmental Approvals necessary to the ownership of its Properties or
to the conduct of its business, in each case to the extent that any such failure
to comply, obtain or keep in force could be reasonably expected to have a
Material Adverse Effect. Without limiting the generality of the foregoing, if
any Environmental Release shall occur at or on any of the owned real Property of
any Borrower or any of its Subsidiaries, Borrowers shall, or shall cause the
applicable Subsidiary to, act promptly and diligently to investigate the extent
of, and to make appropriate remedial action to eliminate, such Environmental
Release, whether or not ordered or otherwise directed to do so by any
Governmental Authority.
10.1.8. Insurance. Maintain with its current insurers or with other
financially sound and reputable insurers having a rating of at least A or better
by Best's Ratings, a publication of A.M. Best Company, (i) insurance with
respect to its Properties and business against such casualties and contingencies
of such type (including product liability, workers' compensation, larceny,
embezzlement, or other criminal misappropriation insurance) and in such amounts
and with such coverages, limits and deductibles as is customary in the business
of such Borrower or such Subsidiary and (ii) business interruption insurance in
an amount not less than $25,000,000.
10.1.9. Post-Closing Obligations.
(i) On or before October 28, 2005, Administrative Agent shall
have received a fully executed Control Agreement with respect to the
Concentration Account, the Wholesale Collection Accounts and the Investment
Accounts, each of which shall be in form and substance reasonably
acceptable to Administrative Agent.
(ii) On or before November 30, 2005, Borrowers shall have
terminated, or shall have caused to be terminated, UCC financing statement
no. 0411460354 naming Syncor Diagnostics Sacramento LLC as debtor and US
Bank Trust NA as Custodian or Trustee filed April 12, 2004 with the
California Secretary of State
10.2. NEGATIVE COVENANTS. For so long as there are any Commitments
outstanding and thereafter until Full Payment of the Obligations (other than
contingent indemnification obligations for which no claim has been made), each
Borrower covenants that it shall not and shall not permit any of its
Subsidiaries to:
10.2.1. Fundamental Changes. (a) Merge, reorganize, consolidate or
amalgamate with any Person, or liquidate, wind up its affairs or dissolve
itself, in each case whether in a single transaction or in a series of related
transactions, except that (i) a Borrower may be merged or consolidated with or
into any of its Subsidiaries provided that such Borrower shall be the continuing
or surviving Person, (ii) any Obligor other than the Parent may be merged or
consolidated with or into any other Obligor other than the Parent, (iii) any
Subsidiary of an Obligor which is not an Obligor may be merged or consolidated
with or into any Obligor provided that such Obligor shall be the continuing or
surviving corporation, (iv) any Subsidiary which is not an Obligor may be merged
or consolidated with or into any other Subsidiary that is not an Obligor, (v)
any Obligor or Subsidiary thereof may be merged or consolidated with or into any
Person in connection with a Permitted Asset Disposition, (vi) any Obligor or
Subsidiary thereof may be merged or
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consolidated with or into any Person in connection with a Permitted Acquisition,
provided that, if such transaction involves a Borrower, such Borrower shall be
the continuing or surviving Person and (vii) any Subsidiary that is not an
Obligor may dissolve, liquidate or wind up its affairs at any time provided that
such dissolution, liquidation or winding up, as applicable, could not reasonably
be expected to have a Material Adverse Effect; or (b) without providing 10 days
prior written notice to Lender, (i) change a Borrower's name or conduct business
under any new fictitious name or (ii) change a Borrower's FEIN, organizational
identification number or state of organization.
10.2.2. Reserved.
10.2.3. Permitted Debt. Create, incur, assume, guarantee or suffer to
exist any Debt, except:
(i) the Obligations;
(ii) Debt existing on the Restatement Effective Date;
(iii) Permitted Purchase Money Debt;
(iv) Permitted Contingent Obligations;
(v) Debt of any Person that is in existence at the time that it
becomes or is consolidated into or merged with a Subsidiary of such
Borrower or that is secured by any asset acquired by any Borrower or any
Subsidiary at the time of any such acquisition, provided that such Debt is
not incurred in contemplation of such Person becoming a Subsidiary or such
acquisition of such asset by any Borrower or any of its Subsidiaries, as
the case may be;
(vi) Debt of an Obligor to any other Obligor or a Subsidiary that
is not an Obligor;
(vii) Debt of a Subsidiary that is not an Obligor to another
Subsidiary that is not an Obligor;
(viii) Debt arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
insufficient funds in the Ordinary Course of Business, provided that such
Debt is extinguished within 5 Business Days of its incurrence;
(ix) Hedging Agreements entered into in the Ordinary Course of
Business and not for speculative purposes;
(x) Debt of a Borrower and its Subsidiaries in respect of
performance bonds, bid bonds, appeal bonds, surety bonds, bankers'
acceptances and similar obligations and trade-related letters of credit, in
each case provided that such Debt is incurred in the Ordinary Course of
Business and not in connection with Debt for Money Borrowed, including
those incurred to secure health, safety and environmental obligations in
the Ordinary Course of Business;
(xi) Debt arising from agreements of a Borrower or any Subsidiary
of a Borrower providing for indemnification, adjustment of purchase price,
earn-outs or similar obligations, in each case, incurred or assumed in
connection with the acquisition of any business, assets or a Subsidiary of
a Borrower, other than guarantees of Debt incurred by any Person
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acquiring all or any portion of such business, assets or a Subsidiary of a
Borrower for the purpose of financing such acquisition;
(xii) Debt incurred by a Subsidiary that is not an Obligor which
is non-recourse to the Obligors;
(xiii) Debt incurred by a Borrower or any Subsidiary thereof to
finance the payment of insurance premiums;
(xv) Non-cash pay Debt owed to Sponsors, provided that such Debt
shall be subordinated to the Obligations on terms reasonably satisfactory
to Administrative Agent;
(xvi) Debt of InSight Health under the Senior Notes up to an
aggregate principal amount of $300,000,000;
(xvii) Debt that is not included in any of the preceding
paragraphs of this SECTION 10.2.3, is not secured by a Lien and does not
exceed at any time, in the aggregate, the sum of $30,000,000 as to all
Borrowers and all of their Subsidiaries; and
(xviii) Refinancing Debt so long as each of the Refinancing
Conditions is met with respect thereto.
None of the provisions of this SECTION 10.2.3 that authorize any Obligor to
incur any Debt shall be deemed to override, modify or waive any of the
provisions of SECTION 10.3, which shall constitute an independent and separate
covenant and obligation of each Borrower.
10.2.4. Affiliate Transactions. Enter into, or be a party to any
transaction with any Affiliate, except: (i) the transactions contemplated by the
Loan Documents; (ii) payment of reasonable compensation to officers and
employees for services actually rendered to Parent, Borrowers or their
respective Subsidiaries; (iii) payment of customary directors' fees and
indemnities and reimbursements paid to directors of Parent and its Subsidiaries;
(iv) so long as no Event of Default under SECTION 12.1.1 or 12.1.10 is in
existence, the payment of fees of the Sponsors contemplated by the Management
Agreement in an aggregate amount not to exceed $500,000 during any Fiscal Year,
(v) the issuance or sale of Equity Interests of Parent (and the exercise of any
warrants, options or other rights to acquire Equity Interests of Parent), to the
extent not prohibited in this Agreement, (vi) transactions between Borrowers,
between or among any Borrower and any Guarantor (other than Parent) or between
and among Obligors (other than Parent), (vii) transactions existing prior to the
date hereof (and renewals or replacements thereof on terms, in each case taken
as a whole, not more disadvantageous to the applicable Obligor or Subsidiary);
(viii) transactions expressly permitted under this Agreement; and (ix)
transactions with Affiliates in the Ordinary Course of Business and pursuant to
the reasonable requirements of such Borrower's or such Subsidiary's business and
upon fair and reasonable terms that are fully disclosed to Administrative Agent
and are no less favorable to such Borrower or such Subsidiary than such Borrower
or such Subsidiary would obtain in a comparable arm's length transaction with a
Person not an Affiliate or stockholder of such Borrower or such Subsidiary.
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10.2.5. Limitation on Liens. Create or suffer to exist any Lien upon
any of its Property, income or profits, whether now owned or hereafter acquired,
except the following (collectively, "Permitted Liens"):
(i) Liens at any time granted to secure the Obligations;
(ii) Liens for Taxes (excluding any Lien imposed pursuant to any
of the provisions of ERISA) not yet due or delinquent or being Properly
Contested;
(iii) statutory Liens of landlords, carriers, warehousemen,
mechanics, materialmen and suppliers and other Liens imposed by Applicable
Law (excluding any Lien for Taxes but including any Lien imposed pursuant
to any of the provisions of ERISA) arising in the Ordinary Course of
Business of a Borrower or a Subsidiary, but only if and for so long as (x)
payment in respect of any such Lien is not overdue for a period of more
than 30 days or the obligations secured by any such Liens are being
Properly Contested and (y) such Liens do not materially detract from the
value of the Property of such Borrower or such Subsidiary, taken as a
whole, and do not materially impair the use thereof in the operation of
Borrowers' and their Subsidiaries' business, taken as a whole;
(iv) Purchase Money Liens securing Permitted Purchase Money Debt;
(v) Liens securing Debt of a Subsidiary of a Borrower to another
Borrower or to another such Subsidiary;
(vi) Liens arising by virtue of the rendition, entry or issuance
against such Borrower or any of its Subsidiaries, or any Property of such
Borrower or any of its Subsidiaries, of any judgment, writ, order, or
decree for an amount that exceeds, individually or in the aggregate,
$25,000 for so long as each Lien (a) is in existence for less than 30
consecutive days after it first arises or is being Properly Contested and
(b) is at all times junior in priority to any Liens in favor of Lender;
(vii) Liens incurred or deposits made in the Ordinary Course of
Business to secure the performance of tenders, bids, leases, contracts
(other than for the repayment of Money Borrowed), statutory obligations,
performance and return of money bonds and other similar obligations or
arising as a result of progress payments under government contracts,
provided that, to the extent any such Liens attach to any of the
Collateral, such Liens are at all times subordinate and junior to the Liens
upon the Collateral in favor of Administrative Agent;
(viii) easements, rights-of-way, restrictions, covenants or other
agreements of record and other similar charges or encumbrances on real
Property of such Borrower or a any of its Subsidiaries that do not secure
any monetary obligation and do not interfere with the ordinary conduct of
the business of the Borrowers and their Subsidiaries, taken as a whole;
(ix) normal and customary rights of setoff upon deposits of cash
in favor of banks and other depository institutions and Liens of a
collecting bank arising under the UCC on checks and other items of payment
in the course of collection;
(x) Liens to secure the Senior Notes on Property of Borrowers
other than the Collateral that secure the Senior Notes;
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(xi) such other Liens as appear on SCHEDULE 10.2.5, to the extent
provided therein (and renewals, replacements, refinancings and extensions
thereof to the extent not prohibited under this Agreement), provided that
no such Lien shall at any time be extended to or cover any Property other
than the Property subject thereto on the Restatement Effective Date.; and
(xii) pledges or deposits in the Ordinary Course of Business in
connection with workers' compensation, unemployment insurance and other
social security legislation, other than any Lien imposed by ERISA;
(xiii) Liens on Property of a Person existing at the time such
Person is acquired or merged with or into or consolidated with an Obligor
or Subsidiary thereof to the extent permitted hereunder (and not created in
anticipation or contemplation thereof), provided that such Liens do not
extend to Property not subject to such Liens at the time of acquisition
(other than improvements thereon) and are no more favorable to the
lienholders than such existing Lien;
(xiv) any interest or title of a lessor under any lease entered
into by a Borrower or any Subsidiary thereof in the Ordinary Course of
Business;
(xv) Liens solely on any cash earnest money deposits made by a
Borrower or any Subsidiary thereof in connection with any letter of intent
or purchase agreement permitted hereunder;
(xvi) Liens in favor of customs and revenue authorities arising
as a matter of Applicable Law to secure payment of customs duties in
connection with the importation of Goods;
(xvii) Liens of sellers of Goods to a Borrower and any of its
Subsidiaries arising under Article 2 of the Uniform Commercial Code or
similar provisions of Applicable Law in the Ordinary Course of Business,
covering only the Goods sold and securing only the unpaid purchase price
for such Goods and related expenses;
(xviii) Liens deemed to exist in connection with Investments in
repurchase agreements permitted under SECTION 10.2.13;
(xix) to the extent constituting a Lien, Retained Rights;
(xx) Liens on insurance policies and the proceeds thereof
securing the financing of the premiums with respect thereto to the extent
permitted hereunder; and
(xxi) Liens on Property other than the Collateral not otherwise
permitted by this Section so long as the aggregate outstanding principal
amount of Debt secured thereby does not exceed $3,000,000 at any time.
The foregoing negative pledge shall not apply to any Margin Stock to the extent
that the application of such negative pledge to such Margin Stock would require
filings or other actions by any Lender under Regulation U or other regulations
of the Board of Governors, or otherwise result in a violation of any such
regulations.
10.2.6. Restrictions on Payment of Certain Debt. Make any payments
with respect to any Subordinated Debt other than (a) payment of regularly
scheduled installments of principal and
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interest and fees and other charges when required to be paid by any instrument
or agreement evidencing such Subordinated Debt, but in each case only to the
extent that payment thereof is not violative of any subordination agreement
relating to such Subordinated Debt and (b) Permitted Senior Subordinated Note
Repurchases.
10.2.7. Distributions. Declare or make any Distributions, except for
Upstream Payments.
10.2.8. Disposition of Assets. Make any Asset Disposition other than a
Permitted Asset Disposition.
10.2.9. Restricted Investments. Make or have any Restricted
Investment.
10.2.10. Tax Consolidation. File or consent to the filing of any
consolidated income tax return with any Person other than Parent or any
Subsidiary or any Subsidiary of Parent.
10.2.11. Accounting Changes. Establish a fiscal year different from
the Fiscal Year.
10.2.12. Organic Documents. Amend, modify or otherwise change any of
the terms or provisions in any of its Organic Documents as in effect on the date
hereof, except for changes that do not affect in any way (i) such Borrower's or
any of its Subsidiaries' right and authority to enter into and perform the Loan
Documents to which it is a party, (ii) the perfection of Administrative Agent's
Liens in any Collateral, or (iii) the authority or obligation of an Obligor to
pay or perform any of the Obligations.
10.2.13. Restrictive Agreements. Enter into or become a party to any
Restrictive Agreement, other than a Permitted Restrictive Agreement.
10.2.14. Hedging Agreements. Enter into any Hedging Agreement, other
than Hedging Agreements entered into in the Ordinary Course of Business to hedge
or mitigate risks to which any Borrower or any Subsidiary is exposed in the
conduct of its business or the management of its liabilities and not for any
speculative purpose.
10.2.15. Anti-Terrorism Laws. Conduct any business or engage in any
transaction or dealing with any Blocked Person (as defined in SECTION
9.1.27(II)), including making or receiving any contribution of funds, goods or
services to or for the benefit of any Blocked Person; deal in, or otherwise
engage in any transaction relating to, any property or interests in property
blocked pursuant to Executive Order No. 13224; or engage in on conspire to
engage in any transaction that evades or avoids, or has the purpose of evading
or avoiding, or attempts to violate, any of the prohibitions set forth in
Executive Order No. 13224 or the USA Patriot Act. Borrowers shall deliver to
Administrative Agent and Lenders any certification or other evidence requested
from time to time by Administrative Agent or any Lender, in its discretion,
confirming each Borrower's compliance with this SECTION 10.2.21.
10.2.16. Conduct of Business. Engage in any business other than the
business engaged in by it on the Restatement Effective Date and any business or
activities which are substantially similar, related or incidental thereto and
reasonable extensions thereof.
10.2.17. Multiemployer Plans. Become, or permit any Subsidiary to
become a party to a Multiemployer Plan.
10.2.18. Amendments to Indentures Amend, modify or supplement, or
permit any Subsidiary to amend, modify or supplement (or consent to any
amendment, modification or supplement
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of) any of the Senior Note Documents or Senior Subordinated Note Documents, if
such amendment, modification or supplement provides for any of the following or
has any of the following effects:
(i) increases the overall principal amount of any Debt evidenced
by any of the Senior Notes or Senior Subordinated Notes or increases the
amount of any single scheduled installment of principal or interest in
excess of amounts otherwise permitted under this Agreement;
(ii) shortens or accelerates the date upon which any installment
of principal or interest becomes due under the Senior Notes or Senior
Subordinated Notes or adds any additional redemption or pre-payment
provisions;
(iii) shortens the final maturity date of such Debt or otherwise
accelerates the amortization schedule with respect to such Debt;
(iv) increases the rate of interest accruing in respect of the
principal amount of such Debt;
(v) provides for the payment of additional fees or increases the
amount of existing fees with respect to such Debt;
(vi) amends or modifies any financial or negative covenant (or a
covenant that prohibits or restricts a Borrower or any of its Subsidiaries
from taking certain actions) in a manner which is more onerous or more
restrictive in any material respect to such Borrower or such Subsidiary or
that is otherwise materially adverse to such Borrower, or its Subsidiaries
and/or Lenders, or, in the case of adding covenants, that places material
additional restriction on such Borrower or such Subsidiary or that requires
such Borrower or such Subsidiary to comply with more restrictive financial
ratios or requires such Borrower to better its financial performance from
that set forth in the existing financial covenants (taking into account,
the aggregate adjustments, if any, to the thresholds and exceptions
applicable thereto on a covenant-by-covenant basis);
(vii) results in any of the Loan Documents not constituting a
"Credit Agreement" under the Senior Note Documents and Senior Subordinated
Note Documents; or
(viii) amends, modifies or adds any affirmative covenant in a
manner which, when taken as a whole, is materially adverse to a Borrower or
its Subsidiaries and/or Lenders.
10.3. Financial Covenant.
10.3.1. Financial Covenant Test Levels. Subject to SECTION 10.3.2
hereof, for so long as there are any Commitments outstanding and thereafter
until Full Payment of the Obligations (other than contingent indemnification
obligations for which no claim has been made), Borrowers covenant that they
shall:
(i) Fixed Charge Coverage Ratio. Maintain a Fixed Charge Coverage
Ratio of at least 1.10 to 1.0 measured as of the last day of each Fiscal
Quarter for the 4 Fiscal Quarters then ended.
10.3.2. Applicability of Financial Covenant. The financial covenant
set forth in SECTION 10.3.1 shall be effective only if, on any Business Day, (a)
there are (i) any Revolver Loans
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outstanding hereunder or (ii) the LC Obligations that have not been Cash
Collateralized exceed $2,500,000 on such Business Day, and (b) Liquidity is, at
the close of business on such Business Day, less than the Financial Covenant
Trigger Amount. From and after such date, the provisions of SECTION 10.3.1 shall
be effective at all times unless and until (i) Liquidity shall exceed the
Financial Covenant Trigger Amount for a period of 90 consecutive days and (ii)
any Event of Default then existing is waived by Administrative Agent. Within 10
Business Days after the date on which the provisions of SECTION 10.3.1(I) are
activated as set forth above in this SECTION 10.3.2, Borrowers shall deliver to
Administrative Agent a Compliance Certificate which reflects Borrowers'
compliance or non-compliance with the provisions of SECTION 10.3.1 as of the
last day of the most recent Fiscal Quarter then ended.
SECTION 11. CONDITIONS PRECEDENT
11.1. CONDITIONS PRECEDENT TO INITIAL CREDIT EXTENSIONS. Initial Lender
shall not be required to fund any requested Loan on the Restatement Effective
Date or otherwise extend credit to Borrowers on the Restatement Effective Date
and Issuing Bank shall have no obligation to issue any Letter of Credit on the
Restatement Effective Date, each of the following conditions has been satisfied:
11.1.1. Loan Documents. Each of the Loan Documents shall have been
duly executed and delivered to Administrative Agent by each of the signatories
thereto (and, with the exception of the Notes, in sufficient counterparts for
each Initial Lender) and no Default or Event of Default shall exist.
11.1.2. Minimum Liquidity. Administrative Agent shall have determined,
and Initial Lender shall be satisfied, that, immediately after Borrowers have
paid (or made provision for payment of) all fees and closing costs incurred in
connection with the Commitments, and after increasing the Availability Reserve
in the amount of any payables of Borrowers that are stretched beyond Borrowers'
customary payment practices, Liquidity is not less than $22,500,000.
11.1.3. Evidence of Perfection and Priority of Liens. Administrative
Agent shall have received each document (including any Uniform Commercial Code
financing statement) necessary to perfect the Liens of Administrative Agent in
the Collateral and evidence in form reasonably satisfactory to Administrative
Agent and Initial Lender that such Liens constitute valid and perfected Liens,
and that there are no other Liens upon any Collateral except for Permitted
Liens.
11.1.4. Organic Documents. Administrative Agent shall have received
copies of the Organic Documents of each Obligor, and all amendments thereto,
certified by the Secretary of State or other appropriate official of the
jurisdiction of each Obligor's organization.
11.1.5. Good Standing Certificates. Administrative Agent shall have
received good standing certificates for each Obligor, issued by the Secretary of
State or other appropriate official of such Obligor's jurisdiction of
organization and each other jurisdiction where the failure of such Obligor to be
qualified could reasonably be expected to have a Material Adverse Effect.
11.1.6. Opinion Letters. Administrative Agent and Initial Lender shall
have received a favorable, written opinion of Kaye Scholer LLP.
11.1.7. Insurance. Administrative Agent shall have received
certificates of insurance with respect to Borrowers' property and liability
insurance policies, in form reasonably acceptable to Administrative Agent,
together with an endorsement naming Administrative Agent as an additional
insured with respect to Borrowers' liability insurance policies, all as required
by the Loan Documents.
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11.1.8. Payment of Fees. Borrowers shall have paid, or made provision
for the payment on the Restatement Effective Date of, all fees and expenses to
be paid hereunder to Administrative Agent and Lenders on the Restatement
Effective Date.
11.1.9. LC Conditions. With respect to the issuance of any Letter of
Credit on the Restatement Effective Date, each of the LC Conditions is
satisfied.
11.1.10. Senior Notes. InSight Health shall have received a gross
principal amount of at least $300,000,000 from the issuance of the Senior Notes.
11.1.11. Financial Statements; Projections. Administrative Agent shall
have received, reviewed and found acceptable all historical and pro forma
financial statements and Projections of Borrowers and their Subsidiaries as
Administrative Agent shall reasonably require.
11.1.12. Senior Note Documents and Senior Subordinated Note Documents.
Administrative Agent shall have received and reviewed the Senior Note Documents
and Senior Subordinated Note Documents and determined that the transactions
contemplated by this Agreement and the other Loan Documents do not and would not
violate or constitute a default or event of default thereunder and that the
Senior Note Documents and Senior Subordinated Note Documents do not otherwise
restrict the transactions contemplated by this Agreement and the other Loan
Documents in a manner that is not acceptable to Administrative Agent.
11.1.13. Initial Borrowing Base Certificate. Administrative Agent
shall have received the initial Borrowing Base Certificate from Borrowers.
11.2. CONDITIONS PRECEDENT TO ALL CREDIT EXTENSIONS. Lenders shall not be
required to fund any Loans or otherwise extend any credit to or for the benefit
of Borrowers and Issuing Bank shall have no obligation to issue any Letter of
Credit, unless and until each of the following conditions has been and continues
to be satisfied:
11.2.1. No Defaults. No Default or Event of Default exists at the
time, or would result from the funding, of any Loan or other extension of
credit.
11.2.2. Representations and Warranties. Each of the representations
and warranties by an Obligor in any of the Loan Documents (including any
representations and warranties in any certificate furnished at any time in
connection herewith) are true and correct in all material respects on and as of
the date of each extension of credit hereunder (except for those representations
or warranties which expressly relate to an earlier date).
11.2.3. No Litigation. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any court, governmental agency or legislative body to enjoin, restrain or
prohibit, or to obtain damages in respect of, or which is related to or arises
out of, this Agreement or any of the other Loan Documents or the consummation of
the transactions contemplated hereby or thereby.
11.2.4. No Material Adverse Effect. No event shall have occurred and
no condition shall exist which has or could be reasonably expected to have a
Material Adverse Effect.
11.2.5. Borrowing Base Certificate. Administrative Agent shall have
received each Borrowing Base Certificate then required by the terms of this
Agreement.
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11.2.6. LC Conditions. With respect to the issuance of any Letter of
Credit after the Restatement Effective Date, each of the LC Conditions is
satisfied.
11.3. LIMITED WAIVER OF CONDITIONS PRECEDENT. If Lenders shall make any
Loan or otherwise extend any credit to Borrowers under this Agreement at a time
when any of the foregoing conditions precedent are not satisfied (regardless of
whether the failure of satisfaction of any such conditions precedent was known
or unknown to Administrative Agent or Lenders), the funding of such Loan or
other extension of credit shall not operate as a waiver of the right of
Administrative Agent and Lenders to insist upon the satisfaction of all
conditions precedent with respect to each subsequent Borrowing requested by
Borrowers or a waiver of any Event of Default as a consequence of the failure of
any such conditions to be satisfied, unless Administrative Agent, with the prior
consent of the Required Lenders, in writing waives the satisfaction of any
condition precedent, in which event such waiver shall only be applicable for the
specific instance given and only to the extent and for the period of time
expressly stated in such written waiver.
SECTION 12. EVENTS OF DEFAULT; REMEDIES ON DEFAULT
12.1. EVENTS OF DEFAULT. The occurrence or existence of any one or more of
the following events or conditions shall constitute an "Event of Default" (each
of which Events of Default shall be deemed to exist unless and until waived by
Administrative Agent and Lenders in accordance with the provisions of SECTION
13.9:
12.1.1. Payment of Obligations. Borrowers shall fail to pay (a) when
due the principal of any Revolver Loans or any reimbursement obligations arising
from drawings under Letters of Credit, or (b) when due any interest on Loans or
on reimbursement obligations arising from drawings under Letters of Credit, or
of fees or other amounts owing hereunder, under any other Loan Documents or in
connection herewith or therewith and, in each case in this clause (b), such
failure shall continue for 5 or more Business Days.
12.1.2. Misrepresentations. Any representation, warranty or other
written statement to Administrative Agent or any Lender by or on behalf of any
Obligor, whether made in or furnished in compliance with or in reference to any
of the Loan Documents (including any representation made in any Borrowing Base
Certificate), proves to have been false or misleading in any material respect
when made or furnished or when reaffirmed pursuant to SECTION 9.2.
12.1.3. Breach of Specific Covenants. Any Borrower shall fail or
neglect to perform, keep or observe any covenant contained in SECTIONS 7.6,
8.2.5, 8.2.6, 10.1.1, 10.1.6, 10.2 or 10.3 on the date that such Borrower is
required to perform, keep or observe such covenant.
12.1.4. Breach of Other Covenants. Any Obligor shall fail or neglect
to perform, keep or observe any covenant contained in this Agreement (other than
a covenant which is dealt with specifically elsewhere in SECTION 12.1) or any
other Loan Document and the breach of such other covenant is not cured within 30
days after the sooner to occur of any Senior Officer's receipt of notice of such
breach from Administrative Agent or the date on which such failure or neglect
first becomes known to any Senior Officer.
12.1.5. Other Defaults. There shall occur any default or event of
default on the part of any Borrower or any Subsidiary under: (i) the Senior
Notes; (ii) the Senior Subordinated Notes; or (iii) any other agreement,
document or instrument to which such Borrower or such Subsidiary is a party or
by which such Borrower or such Subsidiary or any of their respective Properties
is bound, creating or relating to any Debt for Money Borrowed or Capitalized
Lease Obligations (other than the Obligations,
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the Senior Notes or the Senior Subordinated Notes) in excess of $1,000,000 if
the payment or maturity of such Money Borrowed or Capitalized Lease Obligations
may be accelerated in consequence of such default or event of default or demand
for payment of such Debt for Money Borrowed or Capital Lease Obligations may be
made.
12.1.6. Reserved.
12.1.7. Solvency. Any Obligor shall cease to be Solvent.
12.1.8. Insolvency Proceedings. Any Insolvency Proceeding shall be
commenced by any Obligor; an Insolvency Proceeding is commenced against any
Obligor and any of the following events occur: such Obligor consents to the
institution of the Insolvency Proceeding against it, the petition commencing the
Insolvency Proceeding is not timely controverted by such Obligor, the petition
commencing the Insolvency Proceeding is not dismissed within 60 days after the
date of the filing thereof (provided that, in any event, during the pendency of
any such period, Lenders shall be relieved from their obligation to make Loans
or otherwise extend credit to or for the benefit of Borrowers hereunder), an
interim trustee is appointed to take possession all or a substantial portion of
the Properties of such Obligor or to operate all or any substantial portion of
the business of such Obligor or an order for relief shall have been issued or
entered in connection with such Insolvency Proceeding; or any Obligor shall make
an offer of settlement extension or composition to its unsecured creditors
generally.
12.1.9. Business Disruption. There shall occur a cessation of a
substantial part of the business of any Obligor for a period which could be
reasonably expected to have a Material Adverse Effect; or any Obligor shall
suffer the loss or revocation of any license or permit now held or hereafter
acquired by such Obligor which could reasonably be expected to have a Material
Adverse Effect; or any Obligor shall be enjoined, restrained or in any way
prevented by court, governmental or administrative order from conducting all or
any material part of its business affairs which could reasonably be expected to
have a Material Adverse Effect.
12.1.10. ERISA. A Reportable Event shall occur which Administrative
Agent, in its reasonable discretion, shall determine constitutes grounds for the
termination by the Pension Benefit Guaranty Corporation of any Plan or for the
appointment by the appropriate United States district court of a trustee for any
Plan, or if any Plan shall be terminated or any such trustee shall be requested
or appointed, or if any Borrower, any Subsidiary or any Obligor is in "default"
(as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Plan
resulting from such Borrower's, such Subsidiary's or such Obligor's complete or
partial withdrawal from such Plan, in each case to the extent such occurrence
could reasonably be expected to have a Material Adverse Effect.
12.1.11. Challenge to or Insufficiency of Loan Documents. Any Obligor
or any of its Affiliates shall challenge or contest (or support the challenge or
contest of others) in any action, suit or proceeding the validity or
enforceability of any of the Loan Documents, the legality or enforceability of
any of the Obligations or the perfection or priority of any Lien granted to
Administrative Agent, or any of the Loan Documents ceases to be in full force or
effect for any reason other than a full or partial waiver or release by
Administrative Agent and Lenders in accordance with the terms thereof.
12.1.12. Judgment. One or more judgments or orders for the payment of
money in an amount that exceeds, individually or in the aggregate, $1,000,000
(other than amounts covered by (x) insurance for which the insurer thereof has
been notified of such claim and has not challenged such coverage or (y) valid
third party indemnifications for which the indemnifying party thereof has been
notified of such claim and has not challenged such indemnification) shall be
entered against any Borrower or any other Obligor and (i) enforcement
proceedings shall have been commenced by any creditor upon
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such judgment or order, (ii) there shall be any period of 30 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect or (iii) results in the
creation or imposition of a Lien upon any of the Collateral that is not a
Permitted Lien.
12.1.13. Repudiation of or Default Under Guaranty. Any Guarantor shall
revoke or attempt to revoke the Guaranty signed by such Guarantor, shall
repudiate such Guarantor's liability thereunder.
12.1.14. Criminal Forfeiture. Any Obligor is criminally indicted or
convicted for (i) a felony committed in the conducted of the business of such
Obligor or (ii) any state or federal law (including the Controlled Substances
Act, the Money Laundering Control Act of 1986, and the Illegal Exportation of
War Materials Act) that could lead to a forfeiture of any material (as
determined by Administrative Agent in the exercise of its discretion)
Collateral.
12.1.15. Change of Control. A Change of Control shall occur.
12.1.16. Loss of Certification. Any Medicaid Certification or Medicare
Certification of a Borrower, or any physician, medical professional corporation
or other Person with which a Borrower has entered into a services, management or
similar agreement shall expire, terminate, be canceled or otherwise lost, the
result of which shall or could reasonably be expected to have a Material Adverse
Effect.
12.1.17. Change of Deposit Account Instructions. Any action is taken
by a Borrower in contravention of any instruction given by Administrative Agent
regarding the Collection Accounts, the Concentration Account, the Investment
Accounts or any Deposit Accounts subject to Control Agreements, any Control
Agreement is amended or terminated without the written consent of Administrative
Agent, or if any Borrower fails, within 7 Business Days of receipt, to forward
collections of Accounts that it receives to a Collection Account at a time when
a Restrictive Trigger Event has occurred.
12.2. ACCELERATION OF OBLIGATIONS; TERMINATION OF COMMITMENT. Without in
any way limiting the right of Administrative Agent to demand payment of any
portion of the Obligations payable on demand in accordance with this Agreement
upon or at any time after the occurrence of an Event of Default (other than
pursuant to SECTION 12.1.10) and for so long as such Event of Default shall
exist, Administrative Agent may in its discretion (and, upon receipt of written
instructions to do so from the Required Lenders, shall) (a) declare the
principal of and any accrued interest on the Loans and all other Obligations
owing under any of the Loan Documents to be, whereupon the same shall become
without further notice or demand (all of which notice and demand each Borrower
expressly waives), forthwith due and payable and Borrowers shall forthwith pay
to Administrative Agent the entire principal of and accrued and unpaid interest
on the Loans and other Obligations plus reasonable attorneys' fees and court
costs if such principal and interest are collected by or through an
attorney-at-law and (b) terminate the Revolver Commitments; provided, however,
that upon the occurrence of an Event of Default specified in SECTION 12.1.10,
all of the Obligations shall become automatically due and payable without
declaration, notice or demand by Administrative Agent to or upon any Borrower or
any other Obligor and the Revolver Commitments shall automatically terminate as
if terminated by Administrative Agent pursuant to SECTION 6.2.1 and with the
effects specified in SECTION 6.2.4.
12.3. OTHER REMEDIES. Upon and after the occurrence of an Event of Default
and for so long as such Event of Default shall exist, Administrative Agent may
in its discretion (and, upon receipt of
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written direction of the Required Lenders, shall) institute any Enforcement
Action and exercise from time to time the following rights and remedies (subject
to Applicable Law):
12.3.1. All of the rights and remedies of a secured party under the
UCC or under other Applicable Law, and all other legal and equitable rights to
which Administrative Agent may be entitled under any of the Loan Documents, all
of which rights and remedies shall be cumulative and shall be in addition to any
other rights or remedies contained in this Agreement or any of the other Loan
Documents, and none of which shall be exclusive.
12.3.2. The right to collect all amounts at any time payable to a
Borrower from any Account Debtor or other Person at any time indebted to such
Borrower.
12.3.3. The right to enter any premises where any of the Collateral
shall be located (or deemed to be located) or where any books and records
compromising part of the Collateral shall be located and to keep and, if
applicable, store such Collateral on said premises until sold (and if said
premises be owned or leased by a Borrower, then such Borrower agrees not to
charge Administrative Agent for storage of any Collateral therein).
12.3.4. The right to sell or otherwise dispose of all or any
Collateral in its then condition, at public or private sale or sales, with such
notice as may be required by Applicable Law, in lots or in bulk, for cash or on
credit, all as Administrative Agent, in its discretion, may deem advisable. Each
Borrower agrees that any requirement of notice to any Borrower or any other
Obligor of any proposed public or private sale or other disposition of
Collateral by Administrative Agent shall be deemed reasonable notice thereof if
given at least 10 days prior thereto, and such sale may be at such locations as
Administrative Agent may designate in said notice. Administrative Agent shall
have the right to conduct such sales on any Borrower's or any other Obligor's
premises, without charge therefor, and such sales may be adjourned from time to
time in accordance with Applicable Law. Administrative Agent shall have the
right to sell, lease or otherwise dispose of the Collateral, or any part
thereof, for cash, credit or any combination thereof, and Administrative Agent
may purchase all or any part of the Collateral at public or, if permitted by
law, private sale and, in lieu of actual payment of such purchase price, may set
off the amount of such price against the Obligations. The proceeds realized from
the sale or other disposition of any Collateral may be applied, after allowing 2
Business Days for collection, first to any Extraordinary Expenses incurred by
Administrative Agent and then to the remainder of the Obligations as specified
in SECTION 5.6.1.
12.3.5. The right to obtain the appointment of a receiver, without
notice of any kind whatsoever, to take possession of the Collateral and to
exercise such rights and powers as the court appointing such receiver shall
confer upon such receiver.
12.3.6. The right to require Borrowers to Cash Collateralize
outstanding Letters of Credit, and, if Borrowers fail promptly to make such
deposit, Lenders may (and shall upon the direction of the Required Lenders)
advance such amount as a Revolver Loan (whether or not an Out-of-Formula
Condition exists or is created thereby or the Commitments have been terminated).
Any such deposit or advance shall be held by Administrative Agent in the Cash
Collateral Account to fund future payments on any Letter of Credit. When all
Letters of Credit have been drawn upon or expired, any amounts remaining in the
Cash Collateral Account shall be applied against any outstanding Obligations,
or, after Full Payment of all Obligations, returned to Borrowers.
Administrative Agent is hereby granted an irrevocable, non-exclusive
license or other right to use, license or sub-license (exercisable without
payment of royalty or other compensation to any
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Obligor or any other Person) any or all of each Borrower's Intellectual Property
and all of each Borrower's computer hardware and software, and any Property of a
similar nature, in realizing on the Collateral.
12.4. SETOFF. In addition to any Liens granted under any of the Loan
Documents and any rights now or hereafter available under Applicable Law,
Administrative Agent and each Lender (and each of their respective Affiliates)
is hereby authorized by Borrowers at any time that an Event of Default exists,
without notice to Borrowers or any other Person (any such notice being hereby
expressly waived), to set off and to appropriate and apply any and all deposits,
general or special (including certificates of deposit whether matured or
unmatured (but not including trust accounts or any Collection Account into which
payments with respect to Governmental Receivables are directly deposited or
transferred)) and any other Debt at any time held or owing by such Lender or any
of their Affiliates to or for the credit or the account of any Borrower against
and on account of the Obligations of Borrowers arising under the Loan Documents
to Administrative Agent, such Lender or any of their Affiliates, including all
Loans and LC Obligations and all claims of any nature or description arising out
of or in connection with this Agreement, irrespective of whether or not (i)
Administrative Agent or such Lender, shall have made any demand hereunder, (ii)
Administrative Agent, at the request or with the consent of the Required
Lenders, shall have declared the principal of and interest on the Loans and
other amounts due hereunder to be due and payable as permitted by this Agreement
and even though such Obligations may be contingent or unmatured or (iii) the
Collateral for the Obligations is adequate. Notwithstanding the foregoing, each
of Administrative Agent and Lenders agree that Administrative Agent shall not,
without the express consent of the Required Lenders, and that it shall (to the
extent that it is lawfully entitled to do so) upon the request of the Required
Lenders, exercise its setoff rights hereunder, subject to the limitations set
forth in this SECTION 12.4, against any accounts of any Borrower now or
hereafter maintained with Administrative Agent, such Lender or any Affiliate of
any of them, but no Borrower shall have any claim or cause of action against
Administrative Agent or any Lender for any setoff made, subject to the
limitations set forth in this SECTION 12.4, without the consent of the Required
Lenders, and the validity of any such setoff shall not be impaired by the
absence of such consent. If any party (or its Affiliate) exercises the right of
setoff provided for and permitted hereunder, such party shall be obligated to
share any such setoff in the manner and to the extent required by this SECTION
12.4 and SECTION 13.5. Notwithstanding anything herein to the contrary,
Administrative Agent and its Affiliates shall not nor shall it be entitled to,
and each other Secured Party and its Affiliates (and each Participant of any
Lender and Affiliates) hereby waives any and all rights it may have to, set-off
or appropriate any or all deposits (general or special, time or demand,
provisional or final), in any currency, and any other credits, indebtedness or
claims, in any currency, in each case whether direct or indirect, absolute or
contingent, matured or unmatured, at any time held or owing by each Secured
Party and its Affiliates and each Participant of any Lender and its Affiliates
or any branch or agency thereof to or for the credit or the account of any
Obligor, to the extent necessary for the Obligors and each Secured Party and its
Affiliates and each Participant of any Lender and its Affiliates to remain in
compliance with all Healthcare Laws.
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12.5. REMEDIES CUMULATIVE; NO WAIVER.
12.5.1. All covenants, conditions, provisions, warranties, guaranties,
indemnities, and other undertakings of Borrowers contained in this Agreement,
the other Loan Documents, or any other agreement between Administrative Agent of
any Lender and any Obligor, heretofore, concurrently, or hereafter entered into,
shall be deemed cumulative to and not in derogation or substitution of any of
the terms, covenants, conditions, or agreements of Borrowers herein contained.
The rights and remedies of Administrative Agent and Lenders under this Agreement
and the other Loan Documents shall be cumulative and not exclusive of any rights
or remedies that Administrative Agent or any Lender would otherwise have.
12.5.2. The failure or delay of Administrative Agent or any Lender to
require strict performance by Borrowers of any provision of any of the Loan
Documents or to exercise or enforce any rights, Liens, powers or remedies under
any of the Loan Documents or with respect to any Collateral shall not operate as
a waiver of such performance, Liens, rights, powers and remedies, but all such
requirements, Liens, rights, powers, and remedies shall continue in full force
and effect until all Loans and all other Obligations owing or to become owing
from Borrowers to Administrative Agent and Lenders shall have been fully
satisfied. None of the undertakings, agreements, warranties, covenants and
representations of Borrowers contained in this Agreement or any of the other
Loan Documents and no Event of Default by any Borrower under this Agreement or
any other Loan Documents shall be deemed to have been suspended or waived by
Administrative Agent or any Lender, unless such suspension or waiver is by an
instrument in writing specifying such suspension or waiver and is signed by a
duly authorized representative of Administrative Agent or such Lender and
directed to Borrowers.
12.5.3. If Administrative Agent or any Lender shall accept performance
by a Borrower, in whole or in part, of any obligation that such Borrower is
required by any of the Loan Documents to perform only when a Default or Event of
Default exists, or if Administrative Agent or any Lender shall exercise any
right or remedy under any of the Loan Documents that may not be exercised other
than when a Default or Event of Default exists, Administrative Agent's or such
Lender's acceptance of such performance by a Borrower or Administrative Agent's
or such Lender's exercise of any such right or remedy shall not operate to waive
any such Event of Default or to preclude the exercise by Administrative Agent or
any Lender of any other right or remedy, unless otherwise expressly agreed in
writing by Administrative Agent or such Lender, as the case may be.
SECTION 13. ADMINISTRATIVE AGENT
13.1. APPOINTMENT, AUTHORITY AND DUTIES OF ADMINISTRATIVE AGENT.
13.1.1. Each Lender hereby irrevocably appoints and designates BofA as
Administrative Agent to act as herein specified. Administrative Agent may, and
each Lender by its acceptance of a Note and becoming a party to this Agreement
shall be deemed irrevocably to have authorized Administrative Agent to, enter
into all Loan Documents to which Administrative Agent is or is intended to be a
party and all amendments hereto and all Security Documents at any time executed
by any Obligor, for its benefit and the Pro Rata benefit of Lenders and, except
as otherwise provided in this SECTION 13, to exercise such rights and powers
under this Agreement and the other Loan Documents as are specifically delegated
to Administrative Agent by the terms hereof and thereof, together with such
other rights and powers as are reasonably incidental thereto. Each Lender agrees
that any action taken by Administrative Agent or the Required Lenders in
accordance with the provisions of this Agreement or the other Loan Documents,
and the exercise by Administrative Agent or the Required Lenders of any of the
powers set forth herein or therein, together with such other powers as are
reasonably incidental thereto, shall be authorized and binding upon all Lenders.
Without limiting the generality of the foregoing, Administrative Agent shall
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have the sole and exclusive right and authority to (a) act as the disbursing and
collecting agent for Lenders with respect to all payments and collections
arising in connection with this Agreement and the other Loan Documents; (b)
execute and deliver as Administrative Agent each Loan Document (including each
Lien Waiver) and accept delivery of each such agreement by any Obligor or any
other Person; (c) act as collateral Administrative Agent for Secured Parties for
purposes of the perfection of all security interests and Liens created by this
Agreement or the Security Documents and, subject to the direction of the
Required Lenders, for all other purposes stated therein, provided that
Administrative Agent hereby appoints, authorizes and directs each Lender to act
as a collateral sub-agent for Administrative Agent and the other Lenders for
purposes of the perfection of all security interests and Liens with respect to a
Borrower's Deposit Accounts maintained with, and all cash and Cash Equivalents
held by, such Lender; (d) subject to the direction of the Required Lenders,
manage, supervise or otherwise deal with the Collateral; and (e) except as may
be otherwise specifically restricted by the terms of this Agreement and subject
to the direction of the Required Lenders, exercise all remedies given to
Administrative Agent with respect to any of the Collateral under the Loan
Documents relating thereto, Applicable Law or otherwise. The duties of
Administrative Agent shall be ministerial and administrative in nature, and
Administrative Agent shall not have by reason of this Agreement or any other
Loan Document a fiduciary relationship with any Lender (or any of Lender's
participants). Unless and until its authority to do so is revoked in writing by
Required Lenders, Administrative Agent alone shall be authorized to determine
whether any Accounts constitute Eligible Accounts (basing such determination in
each case upon the meanings given to such terms in SECTION 1), or whether to
impose or release any reserve, and to exercise its own Credit Judgment in
connection therewith, which determinations and judgments, if exercised in good
faith, shall exonerate Administrative Agent from any liability to Lenders or any
other Person for any errors in judgment.
13.1.2. Administrative Agent (which term, as used in this sentence,
shall include reference to Administrative Agent's officers, directors,
employees, attorneys, agents and Affiliates and to the officers, directors,
employees, attorneys and agents of Administrative Agent's Affiliates) shall not:
(a) have any duties or responsibilities except those expressly set forth in this
Agreement and the other Loan Documents or (b) be required to take, initiate or
conduct any Enforcement Action (including any litigation, foreclosure or
collection proceedings hereunder or under any of the other Loan Documents)
except to the extent directed to do so by the Required Lenders during the
continuance of any Event of Default. The conferral upon Administrative Agent of
any right hereunder shall not imply a duty on Administrative Agent's part to
exercise any such right unless instructed to do so by the Required Lenders in
accordance with this Agreement.
13.1.3. Administrative Agent may perform any of its duties by or
through its agents and employees and may employ one or more Administrative Agent
Professionals and shall not be responsible for the negligence or misconduct of
any such Administrative Agent Professionals selected by it with reasonable care.
Borrowers shall promptly (and in any event, ON DEMAND) reimburse Administrative
Agent for all reasonable expenses (including all Extraordinary Expenses)
incurred by Administrative Agent pursuant to any of the provisions hereof or of
any of the other Loan Documents or in the execution of any of Administrative
Agent's duties hereby or thereby created or in the exercise of any right or
power herein or therein imposed or conferred upon it or Lenders (excluding,
however, general overhead expenses), and each Lender agrees promptly to pay to
Administrative Agent, ON DEMAND, such Lender's Pro Rata share of any such
reimbursement for expenses (including Extraordinary Expenses) that is not timely
made by Borrowers to Administrative Agent.
13.1.4. The rights, remedies, powers and privileges conferred upon
Administrative Agent hereunder and under the other Loan Documents may be
exercised by Administrative Agent without the necessity of the joinder of any
other parties unless otherwise required by Applicable Law. If Administrative
Agent shall request instructions from the Required Lenders with respect to any
act or
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action (including the failure to act) in connection with this Agreement or any
of the other Loan Documents, Administrative Agent shall be entitled to refrain
from such act or taking such action unless and until Administrative Agent shall
have received instructions from the Required Lenders; and Administrative Agent
shall not incur liability to any Person by reason of so refraining. Without
limiting the foregoing, no Lender shall have any right of action whatsoever
against Administrative Agent as a result of Administrative Agent acting or
refraining from acting hereunder or under any of the Loan Documents pursuant to
or in accordance with the instructions of the Required Lenders except for
Administrative Agent's own gross negligence or willful misconduct in connection
with any action taken by it. Notwithstanding anything to the contrary contained
in this Agreement, Administrative Agent shall not be required to take any action
that is in its opinion contrary to Applicable Law or the terms of any of the
Loan Documents or that would in its reasonable opinion subject it or any of its
officers, employees or directors to personal liability.
13.1.5. Administrative Agent shall promptly, upon receipt thereof,
forward to each Lender (i) copies of any significant written notices, reports,
certificates and other information received by Administrative Agent from any
Obligor (but only if and to the extent such Obligor is not required by the terms
of the Loan Documents to supply such information directly to Lenders) and (ii)
copies of the results of any field audits or other examinations made or prepared
by or on behalf of Administrative Agent with respect to Borrowers or the
Collateral (each, a "Report" and collectively, "Reports"). Administrative Agent
shall conduct field audits of Borrowers at any time or times reasonably
requested by any Lender (but in no event shall Administrative Agent be obliged
to honor such requests more frequently than twice a calendar year unless an
Event of Default exists).
13.2. AGREEMENTS REGARDING COLLATERAL AND EXAMINATION REPORTS.
13.2.1. Lenders hereby irrevocably authorize Administrative Agent to
release any Lien with respect to any Collateral (i) upon the termination of the
Commitments and Full Payment of the Obligations (other than contingent
indemnification obligations for which no claim has been made), (ii) that is the
subject of an Asset Disposition which Borrowers certify in writing to
Administrative Agent is a Permitted Asset Disposition (and Administrative Agent
may rely conclusively on any such certificate without further inquiry), or (iii)
with the written consent of all Lenders. Administrative Agent shall have no
obligation whatsoever to any of the Lenders to assure that any of the Collateral
exists or is owned by a Borrower or is cared for, protected or insured or has
been encumbered, or that Administrative Agent's Liens have been properly,
sufficiently or lawfully created, perfected, protected or enforced or are
entitled to any particular priority or to exercise any duty of care with respect
to any of the Collateral.
13.2.2. Administrative Agent and Lenders each hereby appoints each
other Lender as agent for the purpose of perfecting Liens (for the benefit of
Secured Parties) in any Collateral that, in accordance with the UCC or any other
Applicable Law, can be perfected only by possession. Should any Lender obtain
possession of any such Collateral, such Lender shall notify Administrative Agent
thereof, and, promptly upon Administrative Agent's request therefor, shall
deliver such Collateral to Administrative Agent or otherwise deal with such
Collateral in accordance with Administrative Agent's instructions.
13.2.3. Each Lender agrees that neither BofA nor Administrative Agent
makes any representation or warranty as to the accuracy or completeness of any
Report and shall not be liable for any information contained in or omitted from
any such Report; agrees that the Reports are not intended to be comprehensive
audits or examinations and that BofA or Administrative Agent or any other Person
performing any audit or examination will inspect only specific information
regarding Obligations or the Collateral and will rely significantly upon
Borrowers' books and records as well as upon representations of Borrowers'
officers and employees; agrees to keep all Reports confidential and strictly for
its internal
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use and not to distribute the Reports (or the contents thereof) to any Person
(except to its Participants, attorneys, accountants and other Persons with whom
such Lender has a confidential relationship) or use any Report in any other
manner; and, without limiting the generality of any other indemnification
contained herein, agrees to hold Administrative Agent and any other Person
preparing a Report harmless from any action that the indemnifying Lender may
take or conclusion the indemnifying Lender may reach or draw from any Report in
connection with any Loans or other credit accommodations that the indemnifying
Lender has made or may make to Borrowers, or the indemnifying Lender's
participation in, or its purchase of, a loan or loans of any Obligor, and to pay
and protect, and indemnify, defend and hold Administrative Agent and each other
such Person preparing a Report harmless from and against all claims, actions,
proceedings, damages, costs, expenses and other amounts (including attorneys'
fees) incurred by Administrative Agent and any such other Person preparing a
Report as the direct or indirect result of any third parties who might obtain
all or any part of any Report through the indemnifying Lender.
13.3. RELIANCE BY ADMINISTRATIVE AGENT. Administrative Agent shall be
entitled to rely, and shall be fully protected in so relying, upon any
certification, notice or other communication (including any thereof by
telephone, telex, telegram, telecopier message or cable) believed by it to be
genuine and correct and to have been signed, sent or made by or on behalf of the
proper Person or Persons, and upon advice and statements of Administrative Agent
Professionals selected by Administrative Agent. Without limiting the generality
of the foregoing, Administrative Agent may rely upon any Notice of Borrowing, LC
Request, Notice of Conversion/Continuation or any similar notice or request
believed by Administrative Agent to be genuine. As to any matters not expressly
provided for by this Agreement or any of the other Loan Documents,
Administrative Agent shall in all cases be fully protected in acting or
refraining from acting hereunder and thereunder in accordance with the
instructions of the Required Lenders, and such instructions of the Required
Lenders and any action taken or failure to act pursuant thereto shall be binding
upon Lenders.
13.4. ACTION UPON DEFAULT. Administrative Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default unless it has
received written notice from a Lender or any or all Borrowers specifying the
occurrence and nature of such Default or Event of Default. If Administrative
Agent shall receive such a notice of a Default or an Event of Default or shall
otherwise acquire actual knowledge of any Default or Event of Default,
Administrative Agent shall promptly notify Lenders in writing and Administrative
Agent shall take such action and assert such rights under this Agreement and the
other Loan Documents, or shall refrain from taking such action and asserting
such rights, as the Required Lenders shall direct from time to time. If any
Lender shall receive a notice of a Default or an Event of Default or shall
otherwise acquire actual knowledge of any Default or Event of Default, such
Lender shall promptly notify Administrative Agent and the other Lenders in
writing. As provided in SECTION 13.3, Administrative Agent shall not be subject
to any liability by reason of acting or refraining to act pursuant to any
request of the Required Lenders except for its own willful misconduct or gross
negligence in connection with any action taken by it. In no event shall the
Required Lenders, without the prior written consent of each Lender, direct
Administrative Agent to accelerate and demand payment of the Loans held by one
Lender without accelerating and demanding payment of all other Loans or to
terminate the Commitments of one or more Lenders without terminating the
Commitments of all Lenders. Each Lender agrees that, except as otherwise
provided in any of the Loan Documents or with the written consent of
Administrative Agent and the Required Lenders, it will not take any legal action
or institute any action or proceeding against any Obligor with respect to any of
the Obligations or Collateral or accelerate or otherwise enforce its portion of
the Obligations. Without limiting the generality of the foregoing, none of
Lenders may exercise any right that it might otherwise have under Applicable Law
to credit bid at foreclosure sales, UCC sales or other similar sales or
dispositions of any of the Collateral except as authorized by Administrative
Agent and the Required Lenders. Notwithstanding anything to the contrary set
forth in this SECTION 13.4 or elsewhere in this Agreement, each Lender shall be
authorized
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to take such action to preserve or enforce its rights against any Obligor where
a deadline or limitation period is otherwise applicable and would, absent the
taking of specified action, bar the enforcement of Obligations held by such
Lender against such Obligor, including the filing of proofs of claim in any
Insolvency Proceeding.
13.5. RATABLE SHARING. If any Lender shall obtain any payment or reduction
(including any amounts received as adequate protection of a bank account deposit
treated as cash collateral under the Bankruptcy Code) of any Obligation of
Borrowers (whether voluntary, involuntary, through the exercise of any right of
set-off or otherwise) in excess of its Pro Rata share of payments or reductions
on account of such Obligations obtained by all of the Lenders, such Lender shall
forthwith (i) notify the other Lenders and Administrative Agent of such receipt
and (ii) purchase from the other Lenders such participations in the affected
Obligations as shall be necessary to cause such purchasing Lender to share the
excess payment or reduction, net of costs incurred in connection therewith, on a
Pro Rata basis, provided that if all or any portion of such excess payment or
reduction is thereafter recovered from such purchasing Lender or additional
costs are incurred, the purchase shall be rescinded and the purchase price
restored to the extent of such recovery or such additional costs, but without
interest. Each Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this SECTION 13.5 may, to the fullest extent
permitted by Applicable Law, exercise all of its rights of payment (including
the right of set-off) with respect to such participation as fully as if such
Lender were the direct creditor of Borrowers in the amount of such
participation.
13.6. INDEMNIFICATION OF ADMINISTRATIVE AGENT INDEMNITEES.
13.6.1. Each Lender agrees to indemnify and defend the Administrative
Agent Indemnitees (to the extent not reimbursed by Borrowers, but without
limiting the indemnification obligations of Obligors under any of the Loan
Documents), on a Pro Rata basis, and to hold each of the Administrative Agent
Indemnitees harmless from and against, any and all Claims which may be imposed
on, incurred by or asserted against any of the Administrative Agent Indemnitees
in any way related to or arising out of any of the Loan Documents or referred to
herein or therein or the transactions contemplated thereby (including the costs
and expenses which Borrowers are obligated to pay under SECTION 15.2 or amounts
Administrative Agent may be called upon to pay in connection with any lockbox or
Dominion Account arrangement contemplated hereby or under any indemnity,
guaranty or other assurance of payment or performance given by Administrative
Agent pursuant to SECTION 3.4.2 or the enforcement of any of the terms of any
Loan Documents).
13.6.2. Without limiting the generality of the foregoing provisions of
this SECTION 13.6, if Administrative Agent should be sued by any receiver,
trustee in bankruptcy, debtor-in-possession or other Person on account of any
alleged preference or fraudulent transfer received or alleged to have been
received from any Borrower or any other Obligor as the result of any transaction
under the Loan Documents, then in such event any monies paid by Administrative
Agent in settlement or satisfaction of such suit, together with all
Extraordinary Expenses incurred by Administrative Agent in the defense of same,
shall be promptly reimbursed to Administrative Agent by Lenders to the extent of
each Lender's Pro Rata share.
13.6.3. Without limiting the generality of the foregoing provisions of
this SECTION 13.6, if at any time (whether prior to or after the Commitment
Termination Date) any action or proceeding shall be brought against any of the
Administrative Agent Indemnitees by an Obligor or by any other Person claiming
by, through or under an Obligor, to recover damages for any act taken or omitted
by Administrative Agent under any of the Loan Documents or in the performance of
any rights, powers or remedies of Administrative Agent against any Obligor, any
Account Debtor, the Collateral or with respect to any Loans, or to obtain any
other relief of any kind on account of any transaction involving any
Administrative Agent Indemnitees under or in relation to any of the Loan
Documents, each Lender agrees
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to indemnify, defend and hold the Administrative Agent Indemnitees harmless with
respect thereto and to pay to the Administrative Agent Indemnitees such Lender's
Pro Rata share of such amount as any of the Administrative Agent Indemnitees
shall be required to pay by reason of a judgment, decree, or other order entered
in such action or proceeding or by reason of any compromise or settlement agreed
to by the Administrative Agent Indemnitees, including all interest and costs
assessed against any of the Administrative Agent Indemnitees in defending or
compromising such action, together with attorneys' fees and other legal expenses
paid or incurred by the Administrative Agent Indemnitees in connection
therewith; provided, however, that no Lender shall be liable to any
Administrative Agent Indemnitee for any of the foregoing to the extent that they
arise solely from the willful misconduct or gross negligence of such
Administrative Agent Indemnitee. In Administrative Agent's discretion,
Administrative Agent may also reserve for or satisfy any such judgment, decree
or order from proceeds of Collateral prior to any distributions therefrom to or
for the account of Lenders.
13.7. LIMITATION ON RESPONSIBILITIES OF ADMINISTRATIVE AGENT.
Administrative Agent shall in all cases be fully justified in failing or
refusing to act hereunder unless it shall have received further assurances to
its satisfaction from Lenders of their indemnification obligations under SECTION
13.6 against any and all Indemnified Claims which may be incurred by
Administrative Agent by reason of taking or continuing to take any such action.
Administrative Agent shall not be liable to Lenders for any action taken or
omitted to be taken under or in connection with this Agreement or the other Loan
Documents except as a result and to the extent of losses caused by the
Administrative Agent's actual gross negligence or willful misconduct.
Administrative Agent does not assume any responsibility for any failure or delay
in performance or breach by any Obligor or any Lender of its obligations under
this Agreement or any of the other Loan Documents. Administrative Agent does not
make to Lenders, and no Lender makes to Administrative Agent or the other
Lenders, any express or implied warranty, representation or guarantee with
respect to the Obligations, the Collateral, the Loan Documents or any Obligor.
Neither Administrative Agent nor any of its officers, directors, employees,
attorneys or agents shall be responsible to Lenders, and no Lender nor any of
its agents, attorneys or employees shall be responsible to Administrative Agent
or the other Lenders, for: (i) any recitals, statements, information,
representations or warranties contained in any of the Loan Documents or in any
certificate or other document furnished pursuant to the terms hereof; (ii) the
execution, validity, genuineness, effectiveness or enforceability of any of the
Loan Documents; (iii) the genuineness, enforceability, collectibility, value,
sufficiency, location or existence of any Collateral, or the validity, extent,
perfection or priority of any Lien therein; (iv) the validity, enforceability or
collectibility of any the Obligations; or (v) the assets, liabilities, financial
condition, results of operations, business, creditworthiness or legal status of
any Obligor or any Account Debtor. Neither Administrative Agent nor any of its
officers, directors, employees, attorneys or agents shall have any obligation to
any Lender to ascertain or inquire into the existence of any Default or Event of
Default, the observance or performance by any Obligor of any of the duties or
agreements of such Obligor under any of the Loan Documents or the satisfaction
of any conditions precedent contained in any of the Loan Documents.
Administrative Agent may consult with and employ legal counsel, accountants and
other experts and shall be entitled to act upon, and shall be fully protected in
any action taken in good faith reliance upon, any advice given by such experts.
13.8. SUCCESSOR ADMINISTRATIVE AGENT AND CO-AGENTS.
13.8.1. Subject to the appointment and acceptance of a successor
Administrative Agent as provided below, Administrative Agent may resign at any
time by giving at least 30 days written notice thereof to each Lender and
Borrowers. Upon receipt of any notice of such resignation, the Required Lenders,
after prior consultation with (but without having to obtain consent of) each
Lender, shall have the right to appoint a successor Administrative Agent which
shall be (i) a Lender, (ii) a United States based affiliate of a Lender, or
(iii) a commercial bank that is organized under the laws of the United States or
of any State thereof and has a combined capital surplus of at least $200,000,000
and, provided no
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Default or Event of Default then exists, is reasonably acceptable to Borrowers
(and for purposes hereof, any successor to BofA shall be deemed acceptable to
Borrowers). If no successor Administrative Agent is appointed prior to the
effective date of the resignation of Administrative Agent, then Administrative
Agent may appoint, after consultation with Lenders and Borrower Agent, a
successor agent from among Lenders. Upon the acceptance by a successor
Administrative Agent of an appointment to serve as an Administrative Agent
hereunder, such successor Administrative Agent shall thereupon succeed to and
become vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent without further act, deed or conveyance, and the retiring
Administrative Agent shall be discharged from its duties and obligations
hereunder but shall continue to enjoy the benefits of the indemnification set
forth in SECTIONS 13.6 and 15.2. After any retiring Administrative Agent's
resignation hereunder as Administrative Agent, the provisions of this SECTION 13
(including the provisions of SECTION 13.6) shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Administrative Agent. Notwithstanding anything to the contrary
contained in this Agreement, any successor by merger or acquisition of the stock
or assets of BofA shall continue to be Administrative Agent hereunder without
further act on the part of the parties hereto unless such successor shall resign
in accordance with the provisions hereof.
13.8.2. It is the intent of the parties that there shall be no
violation of any Applicable Law denying or restricting the right of financial
institutions to transact business as agent or otherwise in any jurisdiction. In
case of litigation under any of the Loan Documents, or in case Administrative
Agent deems that by reason of present or future laws of any jurisdiction
Administrative Agent might be prohibited from exercising any of the powers,
rights or remedies granted to Administrative Agent or Lenders hereunder or under
any of the Loan Documents or from holding title to or a Lien upon any Collateral
or from taking any other action which may be necessary hereunder or under any of
the Loan Documents, Administrative Agent may appoint an additional Person as a
separate collateral agent or co-collateral agent which is not so prohibited from
taking any of such actions or exercising any of such powers, rights or remedies.
If Administrative Agent shall appoint an additional Person as a separate
collateral agent or co-collateral agent as provided above, each and every
remedy, power, right, claim, demand or cause of action intended by any of the
Loan Documents to be exercised by or vested in or conveyed to Administrative
Agent with respect thereto shall be exercisable by and vested in such separate
collateral agent or co-collateral agent, but only to the extent necessary to
enable such separate collateral agent or co-collateral agent to exercise such
powers, rights and remedies, and every covenant and obligation necessary to the
exercise thereof by such separate collateral agent or co-collateral agent shall
run to and be enforceable by either of them. Should any instrument from Lenders
be required by the separate collateral agent or co-collateral agent so appointed
by Administrative Agent in order more fully and certainly to vest in and confirm
to him or it such rights, powers, duties and obligations, any and all of such
instruments shall, on request, be executed, acknowledged and delivered by
Lenders whether or not a Default or Event of Default then exists. In case any
separate collateral agent or co-collateral agent, or a successor to either,
shall die, become incapable of acting, resign or be removed, all the estates,
properties, rights, powers, duties and obligations of such separate collateral
agent or co-collateral agent, so far as permitted by Applicable Law, shall vest
in and be exercised by the Administrative Agent until the appointment of a new
collateral agent or successor to such separate collateral agent or co-collateral
agent.
13.9. CONSENTS, AMENDMENTS AND WAIVERS ; OUT-OF-FORMULA LOANS.
13.9.1. No amendment or modification of any provision of this
Agreement or any of the other Loan Documents, nor any waiver of any Default or
Event of Default, shall be effective without the prior written agreement or
consent of the Required Lenders; provided, however, that
(i) without the prior written consent of Administrative Agent, no
amendment or waiver shall be effective with respect to any provision in any of
the Loan Documents (including
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SECTION 3.4 and this SECTION 13) to the extent such provision relates to the
rights, duties, immunities, exculpation, indemnification or discretion of
Administrative Agent;
(ii) without the prior written consent of Issuing Bank, no amendment
or waiver with respect to any of the LC Obligations or the provisions of
Sections 2.3, 4.1.3 or 11.2.6 shall be effective;
(iii) without the prior written consent of each affected Lender, no
amendment or waiver shall be effective that would (1) increase or otherwise
modify any Commitment of such Lender (other than to reduce such Lender's
Commitment on a proportionate basis with the same Commitments of other Lenders);
(2) alter (other than to increase) the rate of interest payable in respect of
any Obligations owed to such Lender; (3) waive or defer collection of any
interest or fee payable to such Lender pursuant to SECTION 3; or (4) subordinate
the payment of any Obligations owed to such Lender to the payment of any Debt
(except as expressly provided in SECTION 5.6.1); and
(iv) without the prior written consent of all Lenders, no amendment or
waiver shall be effective that would (1) waive any Default or Event of Default
if the Default or Event of Default relates to any Borrower's failure to observe
or perform any covenant that may not be amended without the unanimous written
consent of Lenders (and, where so provided hereinafter, the written consent of
Administrative Agent) as hereinafter set forth; (2) alter the provisions of
SECTIONS 3.6, 3.7, 3.8, 3.10, 5.6, 5.7, 7.1 (except to add to the categories of
Property of Borrowers constituting Collateral), 13.9, 15.2, 15.3, 15.4 or 15.16;
(3) amend the definitions of "Pro Rata" or "Required Lenders" (and the other
defined terms used in such definitions), or any provision of this Agreement
obligating Administrative Agent to take certain actions at the direction of the
Required Lenders, or any provision of any of the Loan Documents regarding the
Pro Rata treatment or obligations of Lenders; or (4) subordinate the priority of
any Liens granted to Administrative Agent under any of the Loan Documents to
consensual, non-statutory Liens granted after the Restatement Effective Date to
any other Person, except as currently provided in or contemplated by the Loan
Documents (including a subordination in favor of the holders of Permitted Liens
that are permitted to have priority over Administrative Agent's Liens) and
except for Liens granted by an Obligor to financial institutions with respect to
amounts on deposit with such financial institutions to cover returned items,
processing and analysis charges and other charges in the Ordinary Course of
Business that relate to deposit accounts with such financial institutions.
Notwithstanding the foregoing, the consent or agreement of Borrowers
shall not be necessary to the effectiveness of any amendment or waiver of any
provision of this Agreement that deals solely with the rights and duties of
Lenders and Administrative Agent as among themselves, including SECTIONS 5.6.1
and 15. The making of any Loans hereunder by any Lender during the existence of
a Default or Event of Default shall not be deemed to constitute a waiver of such
Default or Event of Default. Any waiver or consent granted by Lenders hereunder
shall be effective only if in writing and then only in the specific instance and
for the specific purpose for which it was given.
13.9.2. No Borrower will, directly or indirectly, pay or cause to be
paid any remuneration or other thing of value, whether by way of supplemental or
additional interest, fee or otherwise, to any Lender (in its capacity as a
Lender hereunder) as consideration for or as an inducement to the consent to or
agreement by such Lender with any waiver or amendment of any of the terms and
provisions of this Agreement or any of the other Loan Documents to the extent
that the agreement of all Lenders to any such waiver or amendment is required,
unless such remuneration or thing of value is concurrently paid, on the same
terms, on a Pro Rata or other mutually agreed upon basis to all Lenders;
provided, however, that Borrowers may contract to pay a fee only to those
Lenders who actually vote in writing to approve any waiver or amendment of the
terms and provisions of this Agreement or any of the other Loan Documents to the
extent that such waiver or amendment may be implemented by vote of the Required
Lenders and such waiver or amendment is in fact approved.
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13.9.3. Any request, authority or consent of any Person who, at the
time of making such request or giving such a authority or consent, is a Lender,
shall be conclusive and binding upon any Transferee of such Lender.
13.9.4. Unless otherwise directed in writing by the Required Lenders,
Administrative Agent may require Lenders to honor requests by Borrowers for
Out-of-Formula Loans (in which event, and notwithstanding anything to the
contrary set forth in SECTION 2.1.1 or elsewhere in this Agreement, Lenders
shall continue to make Revolver Loans up to their Pro Rata share of the
Commitments) and to forbear from requiring Borrowers to cure an Out-of-Formula
Condition, (1) when no Event of Default exists (or if an Event of Default
exists, when the existence of such Event of Default is not known by
Administrative Agent), if and for so long as (i) such Out-of-Formula Condition
does not continue for a period of more than 14 consecutive days, following which
no Out-of-Formula Condition exists for at least 60 consecutive days before
another Out-of-Formula Condition exists, (ii) the amount of the Revolver Loans
outstanding at any time does not exceed the aggregate of the Commitments at such
time, and (iii) the Out-of-Formula Condition is not known by Administrative
Agent at the time in question to exceed $2,500,000; and (2) regardless of
whether or not an Event of Default exists, if Administrative Agent discovers the
existence of an Out-of-Formula Condition not previously known by it to exist,
but Lenders shall be obligated to continue making such Revolver Loans as
directed by Administrative Agent only (A) if the amount of the Out-of-Formula
Condition is not increased by more than $500,000 above the amount determined by
Administrative Agent to exist on the date of discovery thereof and (B) for a
period not to exceed 30 Business Days. In no event shall any Borrower or any
other Obligor be deemed to be a beneficiary of this SECTION 13.9.4 or authorized
to enforce any of the provisions of this SECTION 13.9.4.
13.10. DUE DILIGENCE AND NON-RELIANCE. Each Lender hereby acknowledges and
represents that it has, independently and without reliance upon Administrative
Agent or the other Lenders, and based upon such documents, information and
analyses as it has deemed appropriate, made its own credit analysis of each
Obligor and its own decision to enter into this Agreement and to fund the Loans
to be made by it hereunder and to purchase participations in the LC Obligations
pursuant to SECTION 2.3.2, and each Lender has made such inquiries concerning
the Loan Documents, the Collateral and each Obligor as such Lender feels
necessary and appropriate, and has taken such care on its own behalf as would
have been the case had it entered into the other Loan Documents without the
intervention or participation of the other Lenders or Administrative Agent. Each
Lender hereby further acknowledges and represents that the other Lenders and
Administrative Agent have not made any representations or warranties to it
concerning any Obligor, any of the Collateral or the legality, validity,
sufficiency or enforceability of any of the Loan Documents. Each Lender also
hereby acknowledges that it will, independently and without reliance upon the
other Lenders or Administrative Agent, and based upon such financial statements,
documents and information as it deems appropriate at the time, continue to make
and rely upon its own credit decisions in making Loans and in taking or
refraining to take any other action under this Agreement or any of the other
Loan Documents. Except for notices, reports and other information expressly
required to be furnished to Lenders by Administrative Agent hereunder,
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any notices, reports or certificates furnished to Administrative
Agent by any Obligor or any credit or other information concerning the affairs,
financial condition, business or Properties of any Obligor (or any of its
Affiliates) which may come into possession of Administrative Agent or any of
Administrative Agent's Affiliates.
13.11. REPRESENTATIONS AND WARRANTIES OF LENDERS. Each Lender represents
and warrants to each Borrower, Administrative Agent and the other Lenders that
it has the power to enter into and perform its obligations under this Agreement
and the other Loan Documents, and that it has taken all necessary and
appropriate action to authorize its execution and performance of this Agreement
and the other Loan Documents to which it is a party, each of which will be
binding upon it and the obligations
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imposed upon it herein or therein will be enforceable against it in accordance
with the respective terms of such documents; and none of the consideration used
by it to make or fund its Loans or to participate in any other transactions
under this Agreement constitutes for any purpose of ERISA or Section 4975 of the
Internal Revenue Code assets of any "plan" as defined in Section 3(3) of ERISA
or Section 4975 of the Internal Revenue Code and the rights and interests of
such Lender in and under the Loan Documents shall not constitute plan assets
under ERISA.
13.12. THE REQUIRED LENDERS. As to any provisions of this Agreement or the
other Loan Documents under which action may or is required to be taken upon
direction or approval of the Required Lenders, the direction or approval of the
Required Lenders shall be binding upon each Lender to the same extent and with
the same effect as if each Lender joined therein. Notwithstanding anything to
the contrary contained in this Agreement, Borrowers shall not be deemed to be a
beneficiary of, or be entitled to enforce, sue upon or assert as a defense to
any of the Obligations, any provisions of this Agreement that requires
Administrative Agent or any Lender to act, or conditions their authority to act,
upon the direction or consent of the Required Lenders; and any action taken by
Administrative Agent or any Lender that requires the consent or direction of the
Required Lenders as a condition to taking such action shall, insofar as
Borrowers are concerned, be presumed to have been taken with the requisite
consent or direction of the Required Lenders.
13.13. SEVERAL OBLIGATIONS. The obligations and Commitment of each Lender
under this Agreement and the other Loan Documents are several and neither
Administrative Agent nor any Lender shall be responsible for the performance by
the other Lenders of its obligations or Commitment hereunder or thereunder.
Notwithstanding any liability of Lenders stated to be joint and several to third
Persons under any of the Loan Documents, such liability shall be shared, as
among Lenders, Pro Rata.
13.14. ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. With respect to its
obligation to lend under this Agreement, the Loans made by it and each Note
issued to it, Administrative Agent shall have the same rights and powers
hereunder and under the other Loan Documents as any other Lender or holder of a
Note and may exercise the same as though it were not performing the duties
specified herein; and the terms "Lenders," "Required Lenders," or any similar
term shall, unless the context clearly otherwise indicates, include
Administrative Agent in its capacity as a Lender. Administrative Agent and its
Affiliates may each accept deposits from, maintain deposits or credit balances
for, invest in, lend money to, act as trustee under indentures of, serve as
financial advisor to, and generally engage in any kind of business with any
Borrower or any other Obligor, or any Affiliate of any Borrower or any other
Obligor, as if it were any other bank and without any duty to account therefor
(or for any fees or other consideration received in connection therewith) to the
other Lenders. BofA or its affiliates may receive information regarding any
Borrower or any of such Borrower's Affiliates and account debtors (including
information that may be subject to confidentiality obligations in favor of
Borrowers or any of their Affiliates) and Lenders acknowledge that neither
Administrative Agent nor BofA shall be under any obligation to provide such
information to Lenders to the extent acquired by BofA in its individual capacity
and not as Administrative Agent hereunder.
13.15. NO THIRD PARTY BENEFICIARIES. This SECTION 13 is not intended to
confer any rights or benefits upon Borrowers or any other Person except Lenders
and Administrative Agent, and no Person (including any Borrower) other than
Lenders and Administrative Agent shall have any right to enforce any of the
provisions of this SECTION 13 except as expressly provided in SECTION 13.17. As
between Borrowers and Administrative Agent, any action that Administrative Agent
may take or purport to take on behalf of Lenders under any of the Loan Documents
shall be conclusively presumed to have been authorized and approved by Lenders
as herein provided.
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13.16. NOTICE OF TRANSFER. Administrative Agent may deem and treat a Lender
party to this Agreement as the owner of such Lender's portion of the Revolver
Loans for all purposes, unless and until a written notice of the assignment or
transfer thereof executed by such Lender has been received by Administrative
Agent.
13.17. REPLACEMENT OF CERTAIN LENDERS. If a Lender ("Affected Lender")
shall have (i) failed to fund its Pro Rata share of any Loan requested (or
deemed requested) by Borrowers which such Lender is obligated to fund under the
terms of this Agreement and which such failure has not been cured, (ii)
requested compensation from Borrowers under SECTION 3.7 to recover increased
costs incurred by such Lender (or its parent or holding company) which are not
being incurred generally by the other Lenders (or their respective parents or
holding companies), (iii) delivered a notice pursuant to SECTION 3.6 claiming
that such Lender is unable to extend LIBOR Loans to Borrowers for reasons not
generally applicable to the other Lenders, (iv) defaulted in paying or
performing any of its obligations to Administrative Agent, or (v) failed or
refused to give its consent to any amendment, waiver or action for which consent
of all of the Lenders is required and in respect of which the Required Lenders
have consented, then, in any such case and in addition to any other rights and
remedies that Administrative Agent, any other Lender or any Borrower may have
against such Affected Lender, any Borrower or Administrative Agent may make
written demand on such Affected Lender (with a copy to Administrative Agent in
the case of a demand by Borrowers and a copy to Borrowers in the case of a
demand by Administrative Agent) for the Affected Lender to assign, and such
Affected Lender shall assign pursuant to one or more duly executed Assignment
and Acceptances within 5 Business Days after the date of such demand, to one or
more Lenders willing to accept such assignment or assignments, or to one or more
Eligible Assignees designated by Administrative Agent, all of such Affected
Lender's rights and obligations under this Agreement (including its Commitment
and all Loans owing to it) in accordance with SECTION 14. Administrative Agent
is hereby irrevocably authorized to execute one or more Assignment and
Acceptances as attorney-in-fact for any Affected Lender which fails or refuses
to execute and deliver the same within 5 Business Days after the date of such
demand. The Affected Lender shall be entitled to receive, in cash and
concurrently with execution and delivery of each such Assignment and Acceptance,
all amounts owed to the Affected Lender hereunder or under any other Loan
Document, including the aggregate outstanding principal amount of the Loans owed
to such Lender, together with accrued interest thereon through the date of such
assignment (but excluding any prepayment penalty or termination charge. Upon the
replacement of any Affected Lender pursuant to this SECTION 13.17, such Affected
Lender shall cease to have any participation in, entitlement to, or other right
to share in the Liens of Administrative Agent in any Collateral and such
Affected Lender shall have no further liability to Administrative Agent, any
Lender or any other Person under any of the Loan Documents (except as provided
in SECTION 13.6 as to events or transactions which occur prior to the
replacement of such Affected Lender), including any commitment to make Loans or
purchase participations in LC Obligations. Administrative Agent shall have the
right at any time, but shall not be obligated to, upon written notice to any
Lender and with the consent of such Lender (which may be granted or withheld in
such Lender's discretion), to purchase for Administrative Agent's own account
all of such Lender's right, title and interest in and to this Agreement, the
other Loan Documents and the Obligations (together with such Lender's interest
in the Commitments), for the face amount of the Obligations owed to such Lender
(or such greater or lesser amount as Administrative Agent and Lender may
mutually agree upon).
13.18. REMITTANCE OF PAYMENTS AND COLLECTIONS.
13.18.1. All payments by any Lender to Administrative Agent shall be
made not later than the time set forth elsewhere in this Agreement on the
Business Day such payment is due; provided, however, that if such payment is due
ON DEMAND by Administrative Agent and such demand is made on the paying Lender
after 11:00 a.m. on such Business Day, then payment shall be made by 11:00 a.m.
on the next Business Day. Payment by Administrative Agent to any Lender shall be
made by wire transfer,
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promptly following Administrative Agent's receipt of funds for the account of
such Lender and in the type of funds received by Administrative Agent; provided,
however, that if Administrative Agent receives such funds at or prior to 12:00
noon, Administrative Agent shall pay such funds to such Lender by 2:00 p.m. on
such Business Day, but if Administrative Agent receives such funds after 12:00
noon, Administrative Agent shall pay such funds to such Lender by 2:00 p.m. on
the next Business Day.
13.18.2. With respect to the payment of any funds from Administrative
Agent to a Lender or from a Lender to Administrative Agent, the party failing to
make full payment when due pursuant to the terms hereof shall, ON DEMAND by the
other party, pay such amount together with interest thereon at the Federal Funds
Rate. In no event shall Borrowers be entitled to receive any credit for any
interest paid by Administrative Agent to any Lender, or by any Lender to
Administrative Agent, at the Federal Funds Rate as provided herein.
13.18.3. If Administrative Agent pays any amount to a Lender in the
belief or expectation that a related payment has been or will be received by
Administrative Agent from an Obligor and such related payment is not received by
Administrative Agent, then Administrative Agent shall be entitled to recover
such amount from each Lender that receives such amount. If Administrative Agent
determines at any time that any amount received by it under this Agreement or
any of the other Loan Documents must be returned to an Obligor or paid to any
other Person pursuant to any Applicable Law, court order or otherwise, then,
notwithstanding any other term or condition of this Agreement or any of the
other Loan Documents, Administrative Agent shall not be required to distribute
such amount to any Lender.
SECTION 14. BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS
14.1. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of Borrowers, Administrative Agent and Lenders and their
respective successors and assigns (which, in the case of Administrative Agent,
shall include any successor Administrative Agent appointed pursuant to SECTION
13.8), except that (i) no Borrower shall have the right to assign its rights or
delegate performance of any of its obligations under any of the Loan Documents
and (ii) any assignment by any Lender must be made in compliance with SECTION
14.3. Administrative Agent may treat the Person which made any Loan or holds any
Note as the owner thereof for all purposes hereof unless and until such Person
complies with SECTION 14.3 in the case of an assignment thereof or, in the case
of any other transfer, a written notice of the transfer is filed with
Administrative Agent. Any assignee or transferee of any rights with respect to
any Note or Loan agrees by acceptance thereof to be bound by all the terms and
provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making such request or giving such authority or
consent is the holder of a Note, shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.
14.2. PARTICIPATIONS.
14.2.1. Permitted Participants; Effect. Any Lender may, in the
ordinary course of its business and in accordance with Applicable Law, at any
time sell to one or more banks or other financial institutions (each a
"Participant") a participating interest in any of the Obligations owing to such
Lender, any Commitment of such Lender or any other interest of such Lender under
any of the Loan Documents. In the event of any such sale by a Lender of
participating interests to a Participant, such Lender's obligations under the
Loan Documents shall remain unchanged, such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
such Lender shall remain the holder of its Loans and Commitments for all
purposes under the Loan Documents, all amounts payable by Borrowers under this
Agreement and any of the Notes shall be determined as if such Lender
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had not sold such participating interests, and Borrowers and Administrative
Agent shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under the Loan Documents. If a Lender
sells a participation to a Person other than an Affiliate of such Lender, then
such Lender shall give prompt written notice thereof to Borrowers and the other
Lenders. A Participant that would be a Foreign Lender if it were a Lender shall
not be entitled to the benefits of SECTION 5.9 unless Borrowers are notified of
the participation sold to Participant and such Participant agrees, for the
benefit of Borrowers, to comply with SECTION 5.10 as though such Participant
were a Lender.
14.2.2. Voting Rights. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment, modification or
waiver of any provision of the Loan Documents other than an amendment,
modification or waiver with respect to any Loans or Commitment in which such
Participant has an interest which forgives principal, interest or fees or
reduces the stated interest rate or the stated rates at which fees are payable
with respect to any such Loan or Commitment, postpones the Commitment
Termination Date, or any date fixed for any regularly scheduled payment of
interest or fees on such Loan or Commitment, or releases from liability any
Borrower or any Guarantor or releases any substantial portion of any of the
Collateral.
14.2.3. Benefit of Set-Off. Each Borrower agrees that each Participant
shall be deemed to have the right of set-off provided in SECTION 12.4 in respect
of its participating interest in amounts owing under the Loan Documents to the
same extent and subject to the same requirements under this Agreement (including
SECTION 13.5) as if the amount of its participating interest were owing directly
to it as a Lender under the Loan Documents, provided that each Lender shall
retain the right of set-off provided in SECTION 12.4 with respect to the amount
of participating interests sold to each Participant. Lenders agree to share with
each Participant, and each Participant by exercising the right of set-off
provided in SECTION 12.4 agrees to share with each Lender, any amount received
pursuant to the exercise of its right of set-off, such amounts to be shared in
accordance with SECTION 13.5 as if each Participant were a Lender. This SECTION
14.2.3 is subject to the limitations set forth in the last sentence of SECTION
12.4.
14.2.4. Notices. Each Lender shall be solely responsible for notifying
its Participants of any matters relating to the Loan Documents to the extent
that any such notice may be required, and neither Administrative Agent nor any
other Lender shall have any obligation, duty or liability to any Participant of
any other Lender. Without limiting the generality of the foregoing, neither
Administrative Agent nor any Lender shall have any obligation to give notices or
to provide documents or information to a Participant of another Lender.
14.3. ASSIGNMENTS.
14.3.1. Permitted Assignments. Subject to its compliance with SECTION
14.3.2, a Lender may, in accordance with Applicable Law, at any time assign to
any Eligible Assignee all or any part of its rights and obligations under the
Loan Documents, so long as (i) each assignment is of a constant, and not a
varying, ratable percentage of all of the transferor Lender's rights and
obligations under the Loan Documents with respect to the Loans and the LC
Obligations and, in the case of a partial assignment, is in a minimum principal
amount of $5,000,000 (unless otherwise agreed by Administrative Agent in its
discretion) and integral multiples of $1,000,000 in excess of that amount; (ii)
except in the case of an assignment in whole of a Lender's rights and
obligations under the Loan Documents or an assignment by one original signatory
to this Agreement to another such signatory, immediately after giving effect to
any assignment, the aggregate amount of the Commitments retained by the
transferor Lender shall in no event be less than $5,000,000 (unless otherwise
agreed by Administrative Agent in its discretion); and (iii) the parties to each
such assignment shall execute and deliver to Administrative Agent, for its
acceptance and
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recording, an Assignment and Acceptance. Nothing contained herein shall limit in
any way the right of a Lender to pledge or assign all or any portion of its
rights under this Agreement or with respect to any of the Obligations to (x) any
Federal Reserve Bank or the United States Treasury as collateral security
pursuant to Regulation A of the Board of Governors and any Operating Circular
issued by such Federal Reserve Bank, provided that, in each case, no such pledge
or assignment of a security interest shall release any Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for any Lender
as a party hereto, (y) direct or indirect contractual counterparties in swap
agreements relating to the Loans, provided that any payment by Borrowers to the
assigning Lender in respect of any assigned Obligations in accordance with the
terms of this Agreement shall satisfy Borrowers' obligations hereunder in
respect of such assigned Obligations to the extent of such payment, and no such
assignment shall release the assigning Lender from its obligations hereunder.
14.3.2. Effect; Effective Date. Upon (i) delivery to Administrative
Agent of a notice of assignment substantially in the form attached as EXHIBIT H
hereto, together with any consents required by SECTION 14.3.1, and (ii) the
recordation of the assignment on the Register and (iii) payment of a $1,500 fee
to the Administrative Agent for processing any assignment to an Eligible
Assignee that is not an Affiliate of the transferor Lender, such assignment
shall become effective. The Assignment and Acceptance shall contain a
representation and warranty by the Eligible Assignee that the assignment
evidenced thereby will not result in a non-exempt "prohibited transaction" under
Section 406 of ERISA. On and after the effective date of such assignment, such
Eligible Assignee shall for all purposes be a Lender party to this Agreement and
the other Loan Document executed by the Lenders and shall have all the rights
and obligations of a Lender under the Loan Documents to the same extent as if it
were an original party thereto, and no further consent or action by Borrowers,
Lenders or Administrative Agent shall be required to release the transferor
Lender with respect to the Commitment (or portion thereof) of such Lender and
Obligations assigned to such Eligible Assignee. Without limiting the generality
of the foregoing, such Eligible Assignee shall be subject to and bound by all of
the Loan Documents. Upon the consummation of any assignment to an Eligible
Assignee pursuant to this SECTION 14.3, the transferor Lender, Administrative
Agent and Borrowers shall make appropriate arrangements so that replacement
Notes are issued to such transferor Lender and new Notes or, as appropriate,
replacement Notes, are issued to such Eligible Assignee, in each case in
principal amounts reflecting their respective Commitments, as adjusted pursuant
to such assignment. If the transferor Lender shall have assigned all of its
interests, rights and obligations under this Agreement pursuant to SECTION
14.3.1, then (i) such transferor Lender shall no longer have any obligation to
indemnify Administrative Agent with respect to any transactions, events or
occurrences that transpire after the effective date of such assignment, (ii)
each Eligible Assignee to which such transferor Lender shall make an assignment
shall be responsible to Administrative Agent to indemnify Administrative Agent
in accordance with this Agreement with respect to transactions, events and
occurrences transpiring on and after the effective date of such assignment to
it, and (iii) the transferor Lender shall continue to be entitled to the
benefits of those provisions of the Loan Documents (including indemnities from
Obligors) that survive Full Payment of the Obligations.
14.3.3. Dissemination of Information. Each Borrower authorizes each
Lender and Administrative Agent to disclose to any Participant, any Eligible
Assignee or any other Person acquiring an interest in the Loan Documents by
operation of law (each a "Transferee"), and any prospective Transferee, any and
all information in Administrative Agent's or such Lender's possession concerning
each Borrower, the Subsidiaries of each Borrower or the Collateral, subject to
appropriate confidentiality undertakings on the part of such Transferee.
14.4. TAX TREATMENT. If any interest in any Loan Document is transferred to
any Transferee that is organized under the laws of any jurisdiction other than
the United States or any State thereof, the transferor Lender shall cause such
Transferee, concurrently with the effectiveness of such transfer, to comply with
the provisions of SECTION 5.9.3.
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SECTION 15. MISCELLANEOUS
15.1. POWER OF ATTORNEY. Each Borrower hereby irrevocably designates,
makes, constitutes and appoints Administrative Agent (and all Persons designated
by Administrative Agent) as such Borrower's true and lawful attorney (and agent
in-fact) and Administrative Agent, or Administrative Agent's designee, may,
without notice to such Borrower and in either such Borrower's or Administrative
Agent's name, but at the cost and expense of Borrowers:
15.1.1. At such time or times as Administrative Agent or said
designee, in its discretion, may determine during the continuance of Restrictive
Trigger Event, endorse such Borrower's name on any Payment Item or other
proceeds of the Collateral (including proceeds of insurance) which come into the
possession of Administrative Agent or under Administrative Agent's control.
15.1.2. At any time that an Event of Default exists and subject to
Applicable Law: (i) demand payment of the Accounts from the Account Debtors,
enforce payment of the Accounts by legal proceedings or otherwise, and generally
exercise all of such Borrower's rights and remedies with respect to the
collection of the Accounts; (ii) settle, adjust, compromise, discharge or
release any of the Accounts or other Collateral or any legal proceedings brought
to collect any of the Accounts or other Collateral; (iii) sell or assign any of
the Accounts and other Collateral upon such terms, for such amounts and at such
time or times as Administrative Agent deems advisable; (iv) prepare, file and
sign such Borrower's name to a proof of claim in bankruptcy or similar document
against any Account Debtor or to any notice of Lien, assignment or satisfaction
of Lien or similar document in connection with any of the Collateral; (v)
receive, open and dispose of all mail addressed to such Borrower and to notify
postal authorities to change the address for delivery thereof to such address as
Administrative Agent may designate; (vi) endorse the name of such Borrower upon
any Payment Item relating to any Collateral and deposit the same to the account
of Administrative Agent for application to the Obligations; (vii) endorse the
name of such Borrower upon any Chattel Paper, Document, Instrument, invoice,
freight bill, bill of lading or similar document or agreement relating to any
Accounts or Inventory of any Obligor and any other Collateral; (viii) use such
Borrower's stationery and sign the name of such Borrower to verifications of the
Accounts and notices thereof to Account Debtors; (ix) use the information
recorded on or contained in any data processing equipment and computer hardware
and software relating to any Collateral; (x) make and adjust claims under
policies of insurance; (xi) sign the name of such Borrower to and file any proof
of claim in an Insolvency Proceeding of any Account Debtor and on notices of
Liens; (xii) take all action as may be necessary to obtain the payment of any
letter of credit or banker's acceptance of which such Borrower is a beneficiary;
and (xiii) do all other acts and things necessary, in Administrative Agent's
determination, to fulfill such Borrower's obligations under any of the Loan
Documents.
15.2. GENERAL INDEMNITY. Whether or not any of the transactions
contemplated by any of the Loan Documents are consummated, each Borrower agrees
to indemnify and defend the Indemnitees and hold the Indemnitees harmless from
and against any Claims that may be instituted or asserted against or are
incurred by any of the Indemnitees. Without limiting the generality of the
foregoing, this indemnity shall extend to any Claims instituted or asserted
against or incurred by any of the Indemnitees (x) under any Environmental Laws
or (other similar laws by reason of a Borrower's or any other Person's failure
to comply with laws applicable to solid or hazardous waste materials or other
toxic substances) or (y) under any Anti-Terrorism Laws, including any fines
assessed against Administrative Agent or any Lender by any Governmental
Authority as a result of conduct of an Obligor. Additionally, if any Taxes
(excluding Excluded Taxes but including any intangibles tax, stamp tax or
recording tax) shall be payable by any party on account of the execution or
delivery of this Agreement, or the execution, delivery, issuance or recording of
any of the other Loan Documents, or the creation or repayment of any of the
Obligations hereunder, by reason of any Applicable Law now or hereafter in
effect, Borrowers shall pay (and shall promptly reimburse Administrative Agent
and Lenders for their payment of) all such Taxes, including
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any interest and penalties thereon, and will indemnify and hold Indemnitees
harmless from and against all liability in connection therewith.
15.3. SURVIVAL OF AND LIMITATIONS UPON INDEMNITIES. Notwithstanding
anything to the contrary in this Agreement or any of the other Loan Documents,
the obligation of each Borrower and each Lender with respect to each indemnity
given by it in this Agreement shall survive the Full Payment of the Obligations,
the termination of any of the Commitments and the resignation of Administrative
Agent. Notwithstanding anything to the contrary contained in this Agreement, no
Borrower shall have any obligation under this Agreement to indemnify an
Indemnitee with respect to any Claim to the extent that it is determined in a
final, non-appealable judgment by a court of competent jurisdiction that such
Claim resulted from the gross negligence or willful misconduct of such
Indemnitee.
15.4. RESERVED.
15.5. SEVERABILITY. Wherever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
Applicable Law, but if any provision of this Agreement shall be prohibited by or
invalid under Applicable Law, such provision shall be ineffective only to the
extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Agreement.
15.6. CUMULATIVE EFFECT; CONFLICT OF TERMS. The provisions of the Other
Agreements and the Security Documents are hereby made cumulative with the
provisions of this Agreement. Without limiting the generality of the foregoing,
the parties acknowledge that this Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the same or
similar matters and that such limitations, tests and measures are cumulative and
each must be performed, except as may be expressly stated to the contrary in
this Agreement. Except as otherwise provided in any of the other Loan Documents
by specific reference to the applicable provision of this Agreement, if any
provision contained in this Agreement is in direct conflict with, or
inconsistent with, any provision in any of the other Loan Documents, the
provision contained in this Agreement shall govern and control.
15.7. COUNTERPARTS; FACSIMILE SIGNATURES. This Agreement and any amendments
hereto may be executed in any number of counterparts and by different parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed to be an original and all of which counterparts taken together
shall constitute but one and the same instrument. Loan Documents may be executed
by facsimile and the effectiveness of any such Loan Documents and signatures
thereon shall, subject to Applicable Law, have the same force and effect as
manually signed originals and shall be binding on all parties thereto.
Administrative Agent may require that any such documents and signatures be
confirmed by a manually-signed original thereof, provided that the failure to
request or deliver the same shall not limit the effectiveness of any facsimile
signature.
15.8. CONSENT. Whenever the consent of Administrative Agent or Lenders (or
any combination of Lenders) is required to be obtained under this Agreement or
any of the other Loan Documents as a condition to any action, inaction,
condition or event, each party whose consent is required shall be authorized to
give or withhold its consent in its discretion and to condition its consent upon
the giving of additional collateral security for the Obligations, the payment of
money or any other matter.
15.9. NOTICES AND COMMUNICATIONS.
15.9.1. Except as otherwise provided in SECTION 4.1.5, all notices,
requests and other communications to or upon a party hereto shall be in writing
(including facsimile transmission or similar writing) and shall be given to such
party at the address or facsimile number for such party on the
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signature pages hereof (or, in the case of a Person who becomes a Lender after
the date hereof, at the address shown on the applicable Assignment and
Acceptance by which such Person became a Lender) or at such other address or
facsimile number as such party may hereafter specify for the purpose by notice
to Administrative Agent and Borrowers in accordance with the provisions of this
SECTION 15.9.
15.9.2. Except as otherwise provided in SECTION 4.1.5, each such
notice, request or other communication shall be effective (i) if given by
facsimile transmission, when transmitted to the facsimile number specified
herein for the noticed party and confirmation of receipt is received, (ii) if
given by mail, 3 Business Days after such communication is deposited in the U.S.
Mail, with first-class postage pre-paid, addressed to the noticed party at the
address specified herein, or (iii) if given by personal delivery, when duly
delivered with receipt acknowledged in writing by the noticed party. In no event
shall a voicemail message be effective as a notice, communication or
confirmation under any of the Loan Documents. Notwithstanding the foregoing, no
notice to or upon Administrative Agent or BofA pursuant to SECTIONS 2.3, 3.1.2,
4.1 or 6.2.2 shall be effective until after actually received by Administrative
Agent. Any written notice, request or demand that is not sent in conformity with
the provisions hereof shall nevertheless be effective on the date that such
notice, request or demand is actually received by the individual to whose
attention at the noticed party such notice, request or demand is required to be
sent. Any notice received by Borrower Agent shall be deemed to have been
received by all Borrowers.
15.9.3. Electronic mail and intranet websites may be used only to
distribute routine communications, such as financial statements, Borrowing Base
Certificates and other information required by SECTION 8 and SECTION 10.1.3, and
to distribute Loan Documents for execution by the parties thereto, and may not
be used for any other purpose as effective notice under this Agreement or any of
the other Loan Documents.
Administrative Agent and Lenders shall be authorized to rely and act upon any
notices (including telephonic communications) purportedly given by or on behalf
of any Borrower even if such notices were made in a manner other than as
specified herein, were incomplete or were not preceded or followed by any other
form of notice specified or required herein, or the terms thereof, as understood
by the recipient, varied from any confirmation thereof. Borrowers jointly and
severally agree to indemnify and defend each Indemnitee from all losses, costs,
expenses and liabilities resulting from the reliance by any such Indemnitee on
each telephone communication purportedly given by or on behalf of any Borrower
other than to the extent constituting gross negligence or willful misconduct of
the Indemnitee.
15.10. PERFORMANCE OF BORROWERS' OBLIGATIONS. If any Borrower shall fail to
discharge any covenant, duty or obligation hereunder or under any of the other
Loan Documents, Administrative Agent may, in its discretion at any time or from
time to time during the continuance of an Event of Default and subject to
Applicable Law, for such Borrower's account and at Borrowers' expense, pay any
amount or do any act required of Borrowers hereunder or under any of the other
Loan Documents or otherwise lawfully requested by Administrative Agent to (i)
enforce any of the Loan Documents or collect any of the Obligations, (ii)
preserve, protect, insure or maintain or realize upon any of the Collateral, or
(iii) preserve, defend, protect or maintain the validity or priority of
Administrative Agent's Liens in any of the Collateral, including the payment of
any judgment against any Borrower. All payments that Administrative Agent may
make under this Section and all reasonable out-of-pocket costs and expenses
(including Extraordinary Expenses) that Administrative Agent pays or incurs in
connection with any action taken by it hereunder shall be reimbursed to
Administrative Agent by Borrowers, ON DEMAND, with interest from the date such
payment is made or such costs or expenses are incurred to the date of payment
thereof at the Default Rate applicable for Revolver Loans that are Base Rate
Loans. Any payment made or other action taken by Administrative Agent under this
Section shall be without prejudice to any right to assert, and without waiver
of, an Event of Default hereunder and to without prejudice to Administrative
Agent's right proceed thereafter as provided herein or in any of the other Loan
Documents.
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15.11. CREDIT INQUIRIES. Each Borrower hereby authorizes and permits
Administrative Agent and Lenders (but Administrative Agent and Lenders shall
have no obligation) to respond to usual and customary credit inquiries from
third parties concerning such Borrower or any of its Subsidiaries.
15.12. TIME OF ESSENCE. Time is of the essence of this Agreement, the Other
Agreements and the Security Documents.
15.13. INDULGENCES NOT WAIVERS. Administrative Agent's or any Lender's
failure at any time or times hereafter, to require strict performance by
Borrowers of any provision of this Agreement shall not waive, affect or diminish
any right of Administrative Agent or any Lender thereafter to demand strict
compliance and performance therewith.
15.14. ENTIRE AGREEMENT; EXHIBITS AND SCHEDULES. This Agreement and the
other Loan Documents, together with all other instruments, agreements and
certificates executed by the parties pursuant to any Loan Document, embody the
entire understanding and agreement between the parties hereto and thereto with
respect to the subject matter hereof and thereof and supersede all prior
agreements, understandings and inducements, whether express or implied, oral or
written, regarding the same subject matter. Each of the Exhibits and each of the
Schedules attached hereto are incorporated into this Agreement and by this
reference made a part hereof.
15.15. INTERPRETATION. No provision of this Agreement or any of the other
Loan Documents shall be construed against or interpreted to the disadvantage of
any party hereto by any court or other governmental or judicial authority by
reason of such party having, or being deemed to have, structured, drafted or
dictated such provision. The paragraph and section headings are for convenience
of reference only and shall not affect the substantive meaning of any provision
of this Agreement.
15.16. OBLIGATIONS OF LENDERS SEVERAL. The Obligations of each Lender
hereunder are several, and no Lender shall be responsible for the obligations or
Commitment of any other Lender. Nothing contained in this Agreement and no
action taken by Lenders pursuant hereto shall be deemed to constitute Lenders to
be a partnership, association, joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled, to the extent not otherwise
restricted hereunder, to protect and enforce its rights arising out of this
Agreement and any of the other Loan Documents, and it shall not he necessary for
Administrative Agent or any other Lender to be joined as an additional party in
any proceeding for such purpose.
15.17. CONFIDENTIALITY. Administrative Agent and Lenders each agrees to
take normal and reasonable precautions to maintain the confidentiality of any
Information (defined below) for a period of 24 months following the Commitment
Termination Date, except that Administrative Agent and any Lender may disclose
such information (i) to their respective Affiliates and individuals employed or
retained by Administrative Agent or such Lender who are or are expected to
become engaged in evaluating, approving, structuring, administering or otherwise
giving professional advice with respect to any of the Loans or Collateral,
including any of their respective legal counsel, auditors or other professional
advisors (it being understood that the Persons to whom such disclosure is made
will be informed of the confidential nature of such Information and instructed
to keep such Information confidential); (ii) to any party to this Agreement from
time to time; (iii) pursuant to Applicable Law, the order of any court or
administrative agency provided, however, that, prior to disclosure pursuant to
this clause (iii), reasonable efforts shall be made to give the Borrowers notice
of request for disclosure and the Borrowers shall be given a reasonable
opportunity, at its expense, to prevent the disclosure or have the Information
maintained as confidential under a protective order; (iv) upon the request or
demand of any regulatory agency or other Governmental Authority having
jurisdiction over Administrative Agent or such Lender or in accordance with
Administrative Agent's or Lender's regulatory compliance policies,
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(v) to the extent reasonably required in connection with any litigation (with
respect to any of the Loan Documents or any of the transactions contemplated
thereby) to which Administrative Agent, any Lender or their respective
Affiliates may be a party, (vi) to the extent reasonably required in connection
with the exercise of any remedies hereunder, (vii) to any actual or proposed
Participant, Eligible Assignee or any other Transferee of all or part of a
Lender's rights hereunder so long as such Person has agreed in writing to be
bound by the provisions of this Section, (viii) to the National Association of
Insurance Commissioners or any similar organization or to any nationally
recognized rating agency that requires access to information about Lender's
portfolio in connection with ratings issued with respect to such Lender, or (ix)
with the consent of Borrowers. As used in this SECTION 15.17, "Information"
means all information received from the Obligors relating to an Obligor or any
of its Subsidiaries or their business, other than any such information that is
available to Agent or Lenders on a nonconfidential basis prior to disclosure by
an Obligor.
15.18. CERTIFICATIONS REGARDING INDENTURES. Each Borrower hereby certifies
to Administrative Agent and Lenders that neither the execution or performance of
this Agreement by Borrowers nor the incurrence of any Debt pursuant to the terms
of this Agreement or any of the other Loan Documents by Borrowers violates any
of the Indentures, including (i) Section 4.09 of the Senior Subordinated Note
Indenture, or (ii) Sections 4.09 or 4.12 of the Senior Note Indenture. Each
Borrower further certifies to Administrative Agent and Lenders that this
Agreement constitutes a "Credit Agreement" under each of the foregoing
Indentures, that all Loans collectively constitute "Senior Bank Debt" under the
Senior Subordinated Notes Indenture and "Permitted Indebtedness" under the
"Credit Agreement" and that the Liens of Administrative Agent hereunder are
permitted under each of the Indentures.
15.20. GOVERNING LAW. This Agreement has been negotiated, executed and
delivered, and shall be deemed to have been made, in New York, New York, and
shall be governed by and construed in accordance with the internal laws (but
without regard to conflict of law principles) of the State of New York, but
giving effect to federal laws relating to national banks.
15.21. USA PATRIOT ACT NOTICE. Administrative Agent hereby notifies
Borrowers that pursuant to the requirements of the USA Patriot Act,
Administrative Agent is required to obtain, verify and record information that
identifies each Borrower, which information includes the name and address of
each Borrower and other information that will allow Administrative Agent to
identify each Borrower in accordance with the USA Patriot Act.
15.22. CONSENT TO FORUM. Each Borrower hereby consents to the non-exclusive
jurisdiction of any United States federal court sitting in or with direct or
indirect jurisdiction over the Southern District of New York or any New York
state or superior court sitting in New York County, New York, in any action,
suit or other proceeding arising out of or relating to this Agreement or any of
the other Loan Documents and each Borrower irrevocably agrees that all claims
and demands in respect of any such action, suit or proceeding may be heard and
determined in any such court and irrevocably waives any objection it may now or
hereafter have as to the venue of any such action, suit or proceeding brought in
any such court or that such court is an inconvenient forum. Nothing herein shall
limit the right of Administrative Agent or any Lender to bring proceedings
against any Borrower in the courts of any other jurisdiction. Any judicial
proceeding commenced by any Borrower against Administrative Agent, BofA, any
Lender or any holder of any of the Obligations, or any Affiliate of
Administrative Agent, BofA, any Lender or any holder of any Obligations,
involving, directly or indirectly, any matter in any way arising out of, related
to or connected with any Loan Document shall be brought only in a United States
federal court sitting in or with direct jurisdiction over the Southern District
of New York or any New York state or superior court sitting in New York County,
New York. Nothing in this Agreement shall be deemed to preclude the enforcement
by Administrative Agent of any judgment or order obtained in such forum or
-111-
the taking of any action under this Agreement to enforce same in any other
appropriate forum or jurisdiction.
15.23. WAIVERS BY BORROWERS. TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, EACH BORROWER WAIVES (I) THE RIGHT TO TRIAL BY JURY (WHICH ADMINISTRATIVE
AGENT AND EACH LENDER HEREBY ALSO WAIVE) IN ANY ACTION, SUIT, PROCEEDING OR
COUNTERCLAIM OF ANY KIND ARISING OUT OF OR RELATED TO ANY OF THE LOAN DOCUMENTS,
THE OBLIGATIONS OR THE COLLATERAL; (II) PRESENTMENT, DEMAND AND PROTEST AND
NOTICE OF PRESENTMENT, PROTEST, DEFAULT, NON PAYMENT, MATURITY, RELEASE,
COMPROMISE, SETTLEMENT, EXTENSION OR RENEWAL OF ANY OR ALL COMMERCIAL PAPER,
ACCOUNTS, CONTRACT RIGHTS, DOCUMENTS, INSTRUMENTS, CHATTEL PAPER AND GUARANTIES
AT ANY TIME HELD BY ADMINISTRATIVE AGENT ON WHICH SUCH BORROWER MAY IN ANY WAY
BE LIABLE AND HEREBY RATIFIES AND CONFIRMS WHATEVER ADMINISTRATIVE AGENT MAY DO
IN THIS REGARD IN CONNECTION WITH AN ENFORCEMENT ACTION BY ADMINISTRATIVE AGENT;
(III) NOTICE PRIOR TO TAKING POSSESSION OR CONTROL OF THE COLLATERAL OR ANY BOND
OR SECURITY WHICH MIGHT BE REQUIRED BY ANY COURT PRIOR TO ALLOWING
ADMINISTRATIVE AGENT TO EXERCISE ANY OF ADMINISTRATIVE AGENT'S REMEDIES; (IV)
THE BENEFIT OF ALL VALUATION, APPRAISEMENT AND EXEMPTION LAWS; (V) ANY CLAIM
AGAINST ADMINISTRATIVE AGENT OR ANY LENDER, ON ANY THEORY OF LIABILITY, FOR
SPECIAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY OR PUNITIVE DAMAGES (AS OPPOSED TO
DIRECT OR ACTUAL DAMAGES) IN RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY
OTHER THEORY OF LIABILITY ARISING OUT OF, OR THE TAKING OF ANY ENFORCEMENT
ACTION; OR RELATED TO ANY OF THE LOAN DOCUMENTS, ANY TRANSACTION THEREUNDER OR
THE USE OF THE PROCEEDS OF ANY LOANS; AND (VI) NOTICE OF ACCEPTANCE HEREOF. EACH
BORROWER ACKNOWLEDGES THAT THE FOREGOING WAIVERS ARE A MATERIAL INDUCEMENT TO
ADMINISTRATIVE AGENT'S AND LENDERS' ENTERING INTO THIS AGREEMENT AND THAT
ADMINISTRATIVE AGENT AND LENDERS ARE RELYING UPON THE FOREGOING WAIVERS IN ITS
FUTURE DEALINGS WITH BORROWERS. EACH BORROWER WARRANTS AND REPRESENTS THAT IT
HAS REVIEWED THE FOREGOING WAIVERS WITH ITS LEGAL COUNSEL AND HAS KNOWINGLY AND
VOLUNTARILY WAIVED ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
[Remainder of page intentionally left blank; signatures begin on following page]
-112-
IN WITNESS WHEREOF, this Agreement has been duly executed and delivered on
the day and year specified at the beginning of this Agreement.
BORROWERS:
INSIGHT HEALTH SERVICES CORP.
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
WILKES-BARRE IMAGING, L.L.C.
By: InSight Health Corp., as the sole
member and sole manager
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
MRI ASSOCIATES, L.P.
By: InSight Health Corp., as the general
partner
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
VALENCIA MRI, LLC
ORANGE COUNTY REGIONAL PET CENTER-
IRVINE, LLC
SAN FERNANDO VALLEY REGIONAL PET CENTER,
LLC
By: InSight Health Corp., as the sole
member
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
[Signatures continued on following page]
PARKWAY IMAGING CENTER, LLC
By: /s/ Brian G. Drazba
------------------------------------
Name: Brian G. Drazba
Title: Manager
INSIGHT HEALTH CORP.
OPEN MRI, INC.
MAXUM HEALTH CORP.
RADIOSURGERY CENTERS, INC.
DIAGNOSTIC SOLUTIONS CORP.
MAXUM HEALTH SERVICES OF NORTH
TEXAS, INC.
MAXUM HEALTH SERVICES OF DALLAS, INC.
NDDC, INC.
SIGNAL MEDICAL SERVICES, INC.
INSIGHT IMAGING SERVICES CORP.
COMPREHENSIVE MEDICAL IMAGING, INC.
COMPREHENSIVE MEDICAL IMAGING CENTERS,
INC.
COMPREHENSIVE MEDICAL IMAGING- BILTMORE,
INC.
COMPREHENSIVE OPEN MRI-EAST MESA, INC.
TME ARIZONA, INC.
COMPREHENSIVE MEDICAL IMAGING- FREMONT,
INC.
COMPREHENSIVE MEDICAL IMAGING- SAN
FRANCISCO, INC.
COMPREHENSIVE OPEN MRI- GARLAND, INC.
IMI OF ARLINGTON, INC.
COMPREHENSIVE MEDICAL IMAGING- FAIRFAX,
INC.
IMI OF KANSAS CITY, INC.
COMPREHENSIVE MEDICAL IMAGING-
BAKERSFIELD, INC.
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
[Signatures continued on following page]
MAXUM HEALTH SERVICES CORP.
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
By: /s/ Marilyn MacNiven Young
------------------------------------
MARILYN MACNIVEN-YOUNG, Secretary
COMPREHENSIVE OPEN MRI-
CARMICHAEL/FOLSOM, LLC
SYNCOR DIAGNOSTICS SACRAMENTO, LLC
SYNCOR DIAGNOSTICS BAKERSFIELD, LLC
By: Comprehensive Medical Imaging, Inc.
and Comprehensive Medical Imaging
Centers, Inc., as the members
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
PHOENIX REGIONAL PET CENTER-
THUNDERBIRD, LLC
By: Comprehensive Medical Imaging
Centers, Inc., as the sole member
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
[Signatures continued on following page]
MESI MRI
MOUNTAIN VIEW MRI
LOS GATOS IMAGING CENTER
WOODBRIDGE MRI
JEFFERSON MRI-BALA
JEFFERSON MRI
By: Comprehensive Medical Imaging, Inc.
and Comprehensive Medical Imaging
Centers, Inc., as the members
By: /s/ Mitch C. Hill
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
Address for all Borrowers:
c/o InSight Health Services Corp.
26250 Enterprise Court
Suite 100
Lake Forest, California 92630
Attention: Mitch C. Hill
Telecopier: (949) 462-0042
With copies to:
InSight Health Services Corp.
26250 Enterprise Court
Suite 100
Lake Forest, California 92630
Attention: General Counsel
Telecopier: (949) 462-3703
Kaye Scholer LLP
425 Park Avenue
New York, New York 10022-3598
Attention: Ed Gabbay
Telecopier: (212) 836-6476
[Signatures continued on following page]
AGENT:
BANK OF AMERICA, N.A.,
as Administrative Agent
By: /s/ Elizabeth L. Walker
------------------------------------
Name: Elizabeth L. Walker
Title: SVP
Address for Agent:
Bank of America, N.A., as
Administrative Agent
300 Galleria Parkway
Suite 800
Atlanta, Georgia 30339
Attention: Loan Administration Manager
Telecopier: (770) 859-2483
With a copy to:
Parker, Hudson, Rainer & Dobbs LLP
1500 Marquis Two Tower
285 Peachtree Center Avenue, N.E.
Atlanta, Georgia 30303
Attention: C. Edward Dobbs
Telecopier: (404) 522-8409
[Signatures continued on following page]
LENDER:
BANK OF AMERICA, N.A.
By: /s/ Elizabeth L. Walker
------------------------------------
Name: Elizabeth L. Walker
Title: SVP
Address for Lender:
Bank of America, N.A., as Lender
300 Galleria Parkway
Suite 800
Atlanta, Georgia 30339
Attention: Loan Administration Manager
Telecopier: (770) 859-2483
With a copy to:
Parker, Hudson, Rainer & Dobbs LLP
1500 Marquis Two Tower
285 Peachtree Center Avenue, N.E.
Atlanta, Georgia 30303
Attention: C. Edward Dobbs
Telecopier: (404) 522-8409
EXHIBIT A
FORM OF REVOLVER NOTE
September __, 2005
U.S. $30,000,000.00 New York, New York
FOR VALUE RECEIVED, the undersigned, INSIGHT HEALTH SERVICES CORP., a
Delaware corporation (hereinafter referred to as "Borrower Agent"), and those
subsidiaries of Borrower Agent listed on the signature pages hereto (Borrower
Agent and each of its subsidiaries listed on the signature pages hereto, being
referred to collectively herein as "Borrowers," and individually as a
"Borrower"), hereby unconditionally, and jointly and severally, promise to pay
to the order of _____________________ (herein, together with any subsequent
holder hereof, called the "Holder") the principal sum of $30,000,000 or such
lesser sum as may constitute Holder's Pro Rata share of the outstanding
principal amount of all Revolver Loans pursuant to the terms of the Loan
Agreement (as defined below) on the date on which such outstanding principal
amounts become due and payable pursuant to SECTION 5.2 of the Loan Agreement, in
strict accordance with the terms thereof. Borrowers likewise unconditionally,
and jointly and severally, promise to pay to Holder interest from and after the
date hereof on the Holder's Pro Rata share of the outstanding principal amount
of Revolver Loans at such interest rates, payable at such times, and computed in
such manner as are specified in SECTION 3.1 of the Loan Agreement, in strict
accordance with the terms thereof.
This Revolver Note ("Note") is issued pursuant to, and is one of the
"Revolver Notes" referred to in, the Amended and Restated Loan and Security
Agreement dated September 22, 2005 (as the same may be amended from time to
time, the "Loan Agreement"), among Borrowers, Bank of America, N.A., as
collateral and administrative agent (in such capacity, together with its
successors in such capacity, the "Administrative Agent") for itself and the
financial institutions from time to time parties thereto as lenders ("Lenders"),
and such Lenders, and Holder is and shall be entitled to all benefits thereof
and of all Loan Documents executed and delivered in connection therewith. This
Note is subject to certain restrictions on transfer or assignment as provided in
the Loan Agreement. All capitalized terms used herein, unless otherwise defined
herein, shall have the meanings ascribed to such terms in the Loan Agreement.
The repayment of the principal balance of this Note is subject to the
provisions of SECTION 5.2 of the Loan Agreement. The entire unpaid principal
balance and all accrued interest on this Note shall be due and payable
immediately upon the termination of the Commitments as set forth in SECTION 6.2
of the Loan Agreement.
All payments of principal and interest shall be made in Dollars in
immediately available funds to Administrative Agent for Holder's benefit as
specified in the Loan Agreement.
Upon or after the occurrence of an Event of Default and for so long as such
Event of Default exists, the principal balance and all accrued interest of this
Note may be declared (or shall become) due and payable in the manner and with
the effect provided in the Loan Agreement, and the unpaid principal balance
hereof shall bear interest at the Default Rate as and when provided in SECTION
3.1.5 of the Loan Agreement. Borrowers jointly and severally agree to pay, and
save Holder harmless against, any liability for the payment of, all costs and
expenses, including, but not limited to, reasonable attorneys' fees, if this
Note is collected by or through an attorney-at-law.
All principal amounts of Revolver Loans made by Holder to Borrowers
pursuant to the Loan Agreement, and all accrued and unpaid interest thereon,
shall be deemed outstanding under this Note and
shall continue to be owing by Borrowers until paid in accordance with the terms
of this Note and the Loan Agreement.
In no contingency or event whatsoever, whether by reason of advancement of
the proceeds hereof or otherwise, shall the amount paid or agreed to be paid to
Holder for the use, forbearance or detention of money advanced hereunder exceed
the highest lawful rate permissible under any law which a court of competent
jurisdiction may deem applicable hereto; and, in the event of any such payment
inadvertently paid by Borrowers or inadvertently received by Holder, such excess
sum shall be, at Borrowers' option, returned to Borrowers forthwith or credited
as a payment of principal, but shall not be applied to the payment of interest.
It is the intent hereof that Borrowers not pay or contract to pay, and that
Holder not receive or contract to receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may be paid by Borrowers under
Applicable Law.
Time is of the essence of this Note. To the fullest extent permitted by
Applicable Law, each Borrower, for itself and its legal representatives,
successors and assigns, expressly waives presentment, demand, protest, notice of
dishonor, notice of non-payment, notice of maturity, notice of protest,
presentment for the purpose of accelerating maturity, diligence in collection,
and the benefit of any exemption or insolvency laws.
Wherever possible each provision of this Note shall be interpreted in such
a manner as to be effective and valid under Applicable Law, but if any provision
of this Note shall be prohibited or invalid under Applicable Law, such provision
shall be ineffective to the extent of such prohibition or invalidity without
invalidating the remainder of such provision or remaining provisions of this
Note. No delay or failure on the part of Holder in the exercise of any right or
remedy hereunder shall operate as a waiver thereof, nor as an acquiescence in
any default, nor shall any single or partial exercise by Holder of any right or
remedy preclude any other right or remedy. Holder, at its option, may enforce
its rights against any Collateral securing this Note without Administrative
Agent or Holder enforcing its rights against any Borrower, any Guarantor of the
indebtedness evidenced hereby or any other property or indebtedness due or to
become due to any Borrower. Each Borrower agrees that, without releasing or
impairing any Borrower's liability hereunder, Holder or Administrative Agent may
at any time release, surrender, substitute or exchange any Collateral securing
this Note and may at any time release any party primarily or secondarily liable
for the indebtedness evidenced by this Note.
The rights of Holder and obligations of Borrowers hereunder shall be
construed in accordance with and governed by the laws (without giving effect to
the conflict of law principles thereof) of the State of New York. This Note is
intended to take effect as an instrument under seal under New York law.
This Note amends and restates the "Revolving Notes" under (and as defined
in) the Existing Credit Agreement (the "Prior Notes"). Nothing contained herein
is intended to constitute a novation or an accord and satisfaction of the Prior
Notes.
-2-
IN WITNESS WHEREOF, each Borrower has caused this Note to be executed under
seal and delivered by its duly authorized officers on the date first above
written.
BORROWERS:
INSIGHT HEALTH SERVICES CORP.
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
WILKES-BARRE IMAGING, L.L.C.
By: InSight Health Corp., as the sole
member and sole manager
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
MRI ASSOCIATES, L.P.
By: InSight Health Corp., as the general
partner
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
VALENCIA MRI, LLC
ORANGE COUNTY REGIONAL PET CENTER-
IRVINE, LLC
SAN FERNANDO VALLEY REGIONAL PET CENTER,
LLC
By: InSight Health Corp., as the sole
member
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
[Signatures continued on following page]
-3-
PARKWAY IMAGING CENTER, LLC
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
INSIGHT HEALTH CORP.
OPEN MRI, INC.
MAXUM HEALTH CORP.
RADIOSURGERY CENTERS, INC.
DIAGNOSTIC SOLUTIONS CORP.
MAXUM HEALTH SERVICES OF NORTH TEXAS,
INC.
MAXUM HEALTH SERVICES OF DALLAS, INC.
NDDC, INC.
SIGNAL MEDICAL SERVICES, INC.
INSIGHT IMAGING SERVICES CORP.
COMPREHENSIVE MEDICAL IMAGING, INC.
COMPREHENSIVE MEDICAL IMAGING CENTERS,
INC.
COMPREHENSIVE MEDICAL IMAGING- BILTMORE,
INC.
COMPREHENSIVE OPEN MRI-EAST MESA, INC.
TME ARIZONA, INC.
COMPREHENSIVE MEDICAL IMAGING- FREMONT,
INC.
COMPREHENSIVE MEDICAL IMAGING- SAN
FRANCISCO, INC.
COMPREHENSIVE OPEN MRI- GARLAND, INC.
IMI OF ARLINGTON, INC.
COMPREHENSIVE MEDICAL IMAGING- FAIRFAX,
INC.
IMI OF KANSAS CITY, INC.
COMPREHENSIVE MEDICAL IMAGING-
BAKERSFIELD, INC.
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
[Signatures continued on following page]
-4-
MAXUM HEALTH SERVICES CORP.
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
By:
------------------------------------
MARILYN MACNIVEN-YOUNG, Secretary
COMPREHENSIVE OPEN MRI-
CARMICHAEL/FOLSOM, LLC
SYNCOR DIAGNOSTICS SACRAMENTO, LLC
SYNCOR DIAGNOSTICS BAKERSFIELD, LLC
By: Comprehensive Medical Imaging, Inc.
and Comprehensive Medical Imaging
Centers, Inc., as the members
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
PHOENIX REGIONAL PET CENTER-
THUNDERBIRD, LLC
By: Comprehensive Medical Imaging
Centers, Inc., as the sole member
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
[Signatures continued on following page]
-5-
MESI MRI
MOUNTAIN VIEW MRI
LOS GATOS IMAGING CENTER
WOODBRIDGE MRI
JEFFERSON MRI-BALA
JEFFERSON MRI
By: Comprehensive Medical Imaging, Inc.
and Comprehensive Medical Imaging
Centers, Inc., as the members
By:
------------------------------------
MITCH C. HILL, Executive Vice
President and Chief Financial
Officer
-6-
EXHIBIT C
FORM OF NOTICE OF CONVERSION/CONTINUATION
Date ______________, ______
Bank of America, N.A., as Administrative Agent
300 Galleria Parkway
Suite 800
Atlanta, Georgia 30339
Attention: Loan Administration Officer
Re: Amended and Restated Loan and Security Agreement dated September 22,
2005, by and among INSIGHT HEALTH SERVICES CORP., a Delaware
corporation (hereinafter referred to as "Borrower Agent"), and those
subsidiaries of Borrower Agent listed on the signature pages thereto
(Borrower Agent and each of its subsidiaries listed on the signature
pages thereto, being referred to collectively herein as "Borrowers,"
and individually as a "Borrower") and BANK OF AMERICA, N.A., as
collateral and administrative agent for certain Lenders from time to
time parties thereto, and such Lenders (as at any time amended, the
"Loan Agreement")
Gentlemen:
This Notice of Conversion/Continuation is delivered to you pursuant to
SECTION 3.1.2 of the Loan Agreement. Unless otherwise defined herein,
capitalized terms used herein shall have the meanings attributable thereto in
the Loan Agreement. Borrowers hereby give notice of their request as follows:
Check as applicable:
[ ] A conversion of Loans from one Type to another, as follows:
(i) The requested date of the proposed conversion is ______________,
20__ (the "Conversion Date");
(ii) The Type of Loans to be converted pursuant hereto are presently
__________________ [select either LIBOR Loans or Base Rate Loans]
in the principal amount of $_____________ outstanding as of the
Conversion Date;
(iii) The portion of the aforesaid Loans to be converted on the
Conversion Date is $_____________ (the "Conversion Amount");
(iv) The Conversion Amount is to be converted into a ____________
[select either a LIBOR Loan or a Base Rate Loan] (the "Converted
Loan") on the Conversion Date.
(v) [In the event a Borrower selects a LIBOR Loan:] Borrowers hereby
request that the Interest Period for such Converted Loan be for a
duration of _____ [insert length of Interest Period].
[ ] A continuation of LIBOR Loans for new Interest Period, as follows:
(i) The requested date of the proposed continuation is
_______________, 20__ (the "Continuation Date");
(ii) The aggregate amount of the LIBOR Loans subject to such
continuation is $________________;
(iii) The duration of the selected Interest Period for the LIBOR Loans
which are the subject of such continuation is: _____________
[select duration of applicable Interest Period];
Each Borrower hereby ratifies and reaffirms all of its liabilities and
obligations under the Loan Documents and certifies that no Event of Default
exists on the date hereof.
Borrowers have caused this Notice of Conversion/Continuation to be executed
and delivered by their duly authorized representative, this _______ day of
______________, 20__.
INSIGHT HEALTH SERVICES CORP.
("Borrower Agent")
By:
------------------------------------
Title:
---------------------------------
-2-
EXHIBIT D
FORM OF NOTICE OF BORROWING
Date ______________, 20__
Bank of America, N.A., as Administrative Agent
300 Galleria Parkway
Suite 800
Atlanta, Georgia 30339
Attention: Loan Administration Officer
Re: Amended and Restated Loan and Security Agreement dated September 22,
2005, by and among INSIGHT HEALTH SERVICES CORP., a Delaware
corporation (hereinafter referred to as "Borrower Agent"), and those
subsidiaries of Borrower Agent listed on the signature pages thereto
(Borrower Agent and each of its subsidiaries listed on the signature
pages thereto, being referred to collectively herein as "Borrowers,"
and individually as a "Borrower"), and BANK OF AMERICA, N.A., as
collateral and administrative agent for certain Lenders from time to
time parties thereto, and such Lenders (as at any time amended, the
"Loan Agreement")
Gentlemen:
This Notice of Borrowing is delivered to you pursuant to SECTION 4.1 of the
Loan Agreement. Unless otherwise defined herein, capitalized terms used herein
shall have the meanings attributable thereto in the Loan Agreement. Borrowers
hereby request a Revolver Loan in the aggregate principal amount of
$______________, to be made on _____________, _____, and to consist of:
Check as applicable: [ ] Base Rate Loans in the aggregate principal amount
of $_____________
[ ] LIBOR Loans in the aggregate principal amount of
$___________, with Interest Periods as follows:
(i) As to $_____________, an Interest Period of
______ month(s);
(ii) As to $_____________, an Interest Period of
______ months;
(iii) As to $_____________, an Interest Period of
______ months.
Each Borrower hereby ratifies and reaffirms all of its liabilities and
obligations under the Loan Documents and hereby certifies that no Default or
Event of Default exists on the date hereof.
Borrowers have caused this Notice of Borrowing to be executed and delivered
by their duly authorized representative, this ______ day of _____________, 20__.
INSIGHT HEALTH SERVICES CORP.
By:
------------------------------------
Title:
---------------------------------
EXHIBIT E
COMPLIANCE CERTIFICATE
[Letterhead of Borrower]
__________________, 20__
Bank of America, N.A., as Administrative Agent
300 Galleria Parkway, N.W.
Suite 800
Atlanta, Georgia 30339
The undersigned, the chief financial officer of INSIGHT HEALTH SERVICES
CORP., a Delaware corporation (hereinafter referred to as "Borrower Agent"), and
those subsidiaries of Borrower Agent listed on the signature pages thereto
(Borrower Agent and each of its subsidiaries listed on the signature pages
thereto, being referred to collectively herein as "Borrowers," and individually
as a "Borrower"), gives this certificate to BANK OF AMERICA, N.A.
("Administrative Agent") in accordance with the requirements of SECTION 10.1.3
of that certain Amended and Restated Loan and Security Agreement dated September
22, 2005, among Borrowers, Administrative Agent and the Lenders referenced
therein ("Loan Agreement"). Capitalized terms used in this Certificate, unless
otherwise defined herein, shall have the meanings ascribed to them in the Loan
Agreement.
1. Based upon my review of the balance sheets and statements of income
of Borrowers and their Subsidiaries for the [Fiscal Year] [quarterly period]
ending __________________, 20__, copies of which are attached hereto, I hereby
certify that:
(a) If a Financial Covenant Trigger Event has occurred and is
continuing, Fixed Charge Coverage Ratio is ____ to ____;
(b) Liquidity is $____________;
I Capital Expenditures during the period and for the Fiscal Year to
date total $_________ for Borrowers.
2. No Default exists on the date hereof, other than: _________________
___________________________________________________________________ [if none, so
state]; and
3. No Event of Default exists on the date hereof, other than _________
_______________________________________________________________ [if none, so
state].
4. As of the date hereof, each Borrower is current in its payment of
all accrued rent and other charges to Persons who own or lease any premises
where any of the Collateral is located, and there are no pending disputes or
claims regarding any Borrower's failure to pay or delay in payment of any such
rent or other charges.
5. Attached hereto is a schedule showing the calculations that support
Borrowers' compliance [non-compliance] with the financial covenants, as shown
above.
Very truly yours,
----------------------------------------
Chief Financial Officer
EXHIBIT G
FORM OF ASSIGNMENT AND ACCEPTANCE
Dated as of ______, 20__
Reference is made to the Amended and Restated Loan and Security Agreement
dated September 22, 2005 (at any time amended, the "Loan Agreement"), among
INSIGHT HEALTH SERVICES CORP. ("Borrower Agent"), those subsidiaries of Borrower
Agent listed on the signature pages thereto (Borrower Agent and each of its
subsidiaries listed on the signature pages thereto being referred to
collectively as "Borrowers" and individually as a "Borrower"), BANK OF AMERICA,
N.A., a national bank, in its capacity as collateral and administrative agent
("Administrative Agent") for the financial institutions from time to time party
to the Loan Agreement ("Lenders"), and such Lenders. Capitalized terms used
herein and not otherwise defined shall have the meanings assigned to such terms
in the Loan Agreement.
______________________________________ (the "Assignor") and
______________________________________ (the "Assignee") agree as follows:
1. Assignor hereby assigns to Assignee and Assignee hereby purchases and
assumes from Assignor (i) a principal amount of $________ of the outstanding
Revolver Loans held by Assignor and $___________ of participations of Assignor
in LC Obligations (which amount[S], according to the records of Administrative
Agent, represent[S] _______% of the total principal amount of outstanding
Revolver Loans and LC Obligations) and (ii) a principal amount of $__________ of
Assignor's Revolver Commitment (which amount includes Assignor's outstanding
Revolver Loans being assigned to Assignee pursuant to clause (i) above and
which, according to the records of Administrative Agent, represents (____%) of
the total Revolver Commitments of Lenders under the Loan Agreement) (the
"Assigned Interest"), together with an interest in the Loan Documents
corresponding to the Assigned Interest. This Agreement shall be effective from
the date on which the following have been satisfied (the "Assignment Effective
Date"): (x) Assignor receives the principal amount of the Assigned Interest in
the Loans, if any; (y) Administrative Agent receives a copy of this Agreement
duly executed by Assignor and Assignee; and (z) Administrative Agent records the
assignment in the Register. From and after the Assignment Effective Date,
Assignee hereby expressly assumes, and undertakes to perform, all of Assignor's
obligations in respect of Assignor's Commitments to the extent, and only to the
extent, of Assignee's Assigned Interest, and all principal, interest, fees and
other amounts which would otherwise be payable to or for Assignor's account in
respect of the Assigned Interest shall be payable to or for Assignee's account,
to the extent such amounts have accrued subsequent to the Assignment Effective
Date.
2. Assignor (i) represents that as of the date hereof, the aggregate of its
Commitments under the Loan Agreement (without giving effect to assignments
thereof, which have not yet become effective) is $__________, and the
outstanding balance of its Loans and participations in LC Obligations (unreduced
by any assignments thereof, which have not yet become effective) is $__________;
(ii) makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in
connection with the Loan Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Loan Agreement or any
other instrument or document furnished pursuant thereto, other than that
Assignor is the legal and beneficial owner of the interest being assigned by it
hereunder and that such interest is free and clear of any adverse claim; [and]
(iii) makes no representation or warranty and assumes no responsibility with
respect to the financial condition of Borrowers, the performance or observance
by Borrowers of any of their obligations under the Loan Agreement or any of the
Loan Documents[; and (iv) attaches the Notes held by it and requests that
Administrative Agent exchange such Notes for new Notes payable to Assignee and
the Assignor in the principal amounts set forth on Schedule A hereto].
3. Assignee (i) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (ii) confirms that it has received a
copy of the Loan Agreement, together with copies of the most recent financial
statements delivered pursuant to SECTION 10.1.3 thereof, and copies of such
other Loan Documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment and Acceptance;
(iii) agrees that it shall, independently and without reliance upon the Assignor
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 the Loan Agreement; (iv) confirms that it is eligible to become an
Assignee; (v) appoints and authorizes Administrative Agent to take such action
as agent on its behalf and to exercise such powers under the Loan Agreement as
are delegated to Administrative Agent by the terms thereof, together with such
powers as are incidental thereto; (vi) agrees that it will strictly observe and
perform all the obligations that are required to be performed by it as a
"Lender" under the terms of the Loan Agreement and the other Loan Documents;
(vii) agrees that it will keep confidential all information with respect to
Borrowers furnished to it by Borrowers or the Assignor to the extent provided in
the Loan Agreement; and (vii) represents and warrants that the assignment
evidenced hereby will not result in a non-exempt "prohibited transaction" under
Section 406 of ERISA.
4. Assignee acknowledges and agrees that it will not sell or otherwise
dispose of the Assigned Interest or any portion thereof, or grant any
participation therein, in a manner which, or take any action in connection
therewith which, would violate the terms of any of the Loan Documents.
5. This Agreement and all rights and obligations shall be interpreted in
accordance with and governed by the laws of the State of New York. If any
provision hereof would be invalid under Applicable Law, then such provision
shall be deemed to be modified to the extent necessary to render it valid while
most nearly preserving its original intent; no provision hereof shall be
affected by another provision's being held invalid.
6. Each notice or other communication hereunder shall be in writing, shall
be sent by messenger, by telecopy or facsimile transmission or by first-class
mail, shall be deemed given when sent and shall be sent as follows:
(a) If to Assignee, to the following address (or to such other
address as Assignee may designate from time to time):
_________________________
_________________________
_________________________
(b) If to Assignor, to the following address (or to such other
address as Assignor may designate from time to time):
_________________________
_________________________
_________________________
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Payments hereunder shall be made by wire transfer of immediately available
Dollars as follows:
If to Assignee, to the following account (or to such other account as
Assignee may designate from time to time):
_________________________
ABA No.__________________
_________________________
Account No.______________
Reference: ______________________
If to Assignor, to the following account (or to such other account as
Assignor may designate from time to time):
_________________________
_________________________
_________________________
ABA No.___________________
For Account of:___________
Reference: _____________________
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed and delivered by their respective duly authorized
officers, as of the date first above written.
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("Assignor")
By:
------------------------------------
Title:
---------------------------------
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("Assignee")
By:
------------------------------------
Title:
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SCHEDULE A TO ASSIGNMENT AND ACCEPTANCE
EXHIBIT H
FORM OF NOTICE
Reference is made to (i) the Amended and Restated Loan and Security
Agreement dated September 22, 2005 (as at any time amended, the "Loan
Agreement") among INSIGHT HEALTH SERVICES CORP. ("Borrower Agent"), those
subsidiaries of Borrower Agent listed on the signature pages thereto (Borrower
Agent and each of its subsidiaries listed on the signature pages thereto being
referred to collectively as "Borrowers" and individually as a "Borrower"), BANK
OF AMERICA, N.A., a national bank, in its capacity as collateral and
administrative agent ("Administrative Agent") for the financial institutions
from time to time party to the Loan Agreement ("Lenders"), and such Lenders, and
(ii) the Assignment and Acceptance dated as of ____________, 20__ (the
"Assignment Agreement") between __________________ (the "Assignor") and
____________________ (the "Assignee"). Except as otherwise defined herein,
capitalized terms used herein which are defined in the Loan Agreement are used
herein with the respective meanings specified therein.
The Assignor hereby notifies Borrowers and Administrative Agent of
Assignor's intent to assign to Assignee pursuant to the Assignment Agreement a
principal amount of (i) $________ of the outstanding Revolver Loans and
participations in LC Obligations held by Assignor, (ii) $___________ of
Assignor's Revolver Commitment (which amount includes the Assignor's outstanding
Revolver Loans being assigned to Assignee pursuant to clause (i) above),
together with an interest in the Loan Documents corresponding to the interest in
the Loans and Commitments so assigned. Pursuant to the Assignment Agreement,
Assignee has expressly assumed all of Assignor's obligations under the Loan
Agreement to the extent of the Assigned Interest (as defined in the Assignment
Agreement).
For purposes of the Loan Agreement, Administrative Agent shall deem
Assignor's share of the Revolver Commitment to be reduced by $_________ and
Assignee's share of the Revolver Commitment [and Term Loan Commitment] to be
increased by $_________.
The address of the Assignee to which notices, information and payments are
to be sent under the terms of the Loan Agreement is:
_________________________
_________________________
_________________________
_________________________
Assignee's LIBOR Lending Office address is as follows:
_________________________
_________________________
_________________________
_________________________
This Notice is being delivered to Borrowers and Administrative Agent
pursuant to SECTION 14.3 of the Loan Agreement. Please acknowledge your receipt
of this Notice by executing and returning to Assignee and Assignor a copy of
this Notice.
IN WITNESS WHEREOF, the undersigned have caused the execution of this
Notice, as of _________________, 20__.
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("Assignor")
By:
------------------------------------
Title:
---------------------------------
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("Assignee")
By:
------------------------------------
Title:
---------------------------------
ACKNOWLEDGED AND AGREED TO
AS OF THE DATE SET FORTH ABOVE:
BORROWERS:*
- -------------------------------------
By:
---------------------------------
Title:
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- -------------------------------------
By:
---------------------------------
Title:
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- -------------------------------------
By:
---------------------------------
Title:
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* No signature required by any Borrower when an Event of Default exists.
BANK OF AMERICA, N.A.,
as Administrative Agent
By:
---------------------------------
Title:
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EXHIBIT I
LETTER OF CREDIT REQUEST
Bank of America, N.A., as Administrative Agent
The Treasury and International Services Group,
GA1-006-10-32
600 Peachtree Street. NE, 10th Floor
Atlanta, Georgia 30308
Attention: Ms. Sue Sewell
This Letter of Credit Request is delivered to you pursuant to the Amended
and Restated Loan and Security Agreement, dated September 22, 2005, among
INSIGHT HEALTH SERVICES CORP., a Delaware corporation (hereinafter referred to
as "Borrower Agent"), and those subsidiaries of Borrower Agent listed on the
signature pages thereto (Borrower Agent and each of its subsidiaries listed on
the signature pages thereto, being referred to collectively herein as
"Borrowers," and individually as a "Borrower"), and various financial
institutions as are, or may become, parties thereto (collectively, the
"Lenders"), BANK OF AMERICA, N. A., as collateral and administrative agent (in
such capacity, the "Administrative Agent") (as the same may be amended,
supplemented, restated or otherwise modified from time to time, the "Loan
Agreement"). Unless otherwise defined herein, terms used herein have the
meanings assigned to them in the Loan Agreement.
Borrowers hereby request Issuing Bank to issue a Letter of Credit, as
follows:
(1) Borrower's/Account Party's Name ______________________
(2) Amount of Letter of Credit: $_____________________
(3) Issuance Date: ______________________
(4) Beneficiary's Name: ______________________
(5) Beneficiary's Address: ______________________
______________________
______________________
______________________
(6) Expiry Date: ______________________
(7) Draw Conditions: ______________________
______________________
______________________
______________________
(8) Single draw [ ] or Multiple draw [ ] ______________________
(9) Purpose of Letter of Credit: ______________________
______________________
______________________
______________________
Attached hereto is Issuing Bank's form of LC Application, completed with
the details of the Letter of Credit requested herein.
Each Borrower hereby certifies that each of the LC Conditions is now, and
will on the date of issuance of the Letter of Credit, be satisfied in all
respects and that no Default or Event of Default exists. Each Borrower hereby
ratifies and reaffirms all of the Loan Documents and Obligations arising
thereunder.
IN WITNESS WHEREOF, each Borrower has caused this Letter of Credit Request
to be executed and delivered by its duly authorized officer, this ___ day of
_________________, 20__.
INSIGHT HEALTH SERVICES CORP.
("Borrower Agent")
By:
------------------------------------
Name:
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Title:
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EXHIBIT J
PORTFOLIO INTEREST EXEMPTION CERTIFICATE
Reference is hereby made to the Amended and Restated Loan and Security
Agreement dated September 22, 2005 among InSight Health Services Corp. ("InSight
Health"), certain subsidiaries of InSight Health (together with InSight Health,
collectively "Borrowers") and Bank of America, N.A. as collateral and
administrative agent (together with its successors in such capacity,
"Administrative Agent") (as at any time amended, the "Loan Agreement"). The
undersigned hereby certifies the following on behalf of
_____________________________________ ("Lender"):
1. The Lender is not a bank for purposes of SECTION 881(C)(3)(A) of
the Internal Revenue Code of 1986, as amended (the "Code");
2. The Lender is not a 10-percent shareholder of the Borrower (within
the meaning of SECTION 871(H)(3)(B) of the Code); and
3. The Lender is not a controlled foreign corporation related to the
Borrower (within the meaning of SECTION 864(D)(4) of the Code.
Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of the Lender.
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Date
By:
---------------------------------
Title:
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EXHIBIT K
FORM OF BORROWING BASE CERTIFICATE
[See Attached]
INSIGHT HEALTH SERVICES CORP.
AND EACH OF ITS SUBSIDIARIES LISTED ON THE PAGES HERETO,
as Borrowers
LOAN AND SECURITY AGREEMENT
Dated: September 22, 2005
$30,000,000.00
and
BANK OF AMERICA, N.A., as Lender
TABLE OF CONTENTS
Page
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Section 1. DEFINITIONS; RULES OF CONSTRUCTION.......................... 2
1.1. Definitions................................................... 2
1.2. Accounting Terms.............................................. 37
1.3. Other Terms................................................... 37
1.4. Certain Matters of Construction............................... 37
Section 2. CREDIT FACILITY............................................. 38
2.1. Commitment.................................................... 38
2.2. Reserved...................................................... 39
2.3. LC Facility................................................... 39
2.4. Bank Products................................................. 43
Section 3. INTEREST, FEES AND CHARGES.................................. 44
3.1. Interest...................................................... 44
3.2. Fees.......................................................... 46
3.3. Computation of Interest and Fees.............................. 47
3.4. Reimbursement Obligations..................................... 47
3.5. Bank Charges.................................................. 48
3.6. Illegality.................................................... 48
3.7. Increased Costs............................................... 49
3.8. Capital Adequacy.............................................. 50
3.9. Mitigation.................................................... 50
3.10. Funding Losses................................................ 50
3.11. Maximum Interest.............................................. 51
Section 4. LOAN ADMINISTRATION......................................... 52
4.1. Manner of Borrowing and Funding Revolver Loans................ 52
4.2. Defaulting Lender............................................. 55
4.3. Special Provisions Governing LIBOR Loans...................... 56
4.4. Borrower Agent................................................ 56
4.5. All Loans to Constitute One Obligation........................ 57
Section 5. PAYMENTS.................................................... 57
5.1. General Payment Provisions.................................... 57
5.2. Repayment of Revolver Loans................................... 57
5.3. Reserved...................................................... 58
5.4. Payment of Other Obligations.................................. 58
5.5. Marshaling; Payments Set Aside................................ 59
5.6. Allocation of Payments........................................ 59
5.7. Application of Payments and Collateral Proceeds............... 60
5.8. Loan Accounts; Account Stated................................. 60
5.9. Taxes......................................................... 61
5.10. Nature and Extent of Each Borrower's Liability................ 62
Section 6. TERM AND TERMINATION OF COMMITMENT........................... 64
6.1. Term of Commitments........................................... 64
6.2. Termination................................................... 64
Section 7. COLLATERAL.................................................. 64
7.1. Grant of Security Interest.................................... 65
7.2. Reserved...................................................... 65
7.3. Reserved...................................................... 65
7.4. Certain After-Acquired Collateral............................. 65
7.5. No Assumption of Liability.................................... 65
7.6. Lien Perfection; Further Assurances........................... 65
Section 8. COLLATERAL ADMINISTRATION................................... 66
8.1. General Provisions............................................ 66
8.2. Administration of Accounts.................................... 66
8.3. Administration of Deposit Accounts............................ 68
8.4. Borrowing Base Certificates................................... 69
Section 9. REPRESENTATIONS AND WARRANTIES.............................. 69
9.1. General Representations and Warranties........................ 69
9.2. Reaffirmation of Representations and Warranties............... 76
9.3. Survival of Representations and Warranties.................... 76
Section 10. COVENANTS AND CONTINUING AGREEMENTS......................... 76
10.1. Affirmative Covenants......................................... 76
10.2. Negative Covenants............................................ 79
10.3. Financial Covenants........................................... 85
Section 11. CONDITIONS PRECEDENT........................................ 86
11.1. Conditions Precedent to Initial Credit Extensions............. 86
11.2. Conditions Precedent to All Credit Extensions................. 87
11.3. Limited Waiver of Conditions Precedent........................ 88
Section 12. EVENTS OF DEFAULT; REMEDIES ON DEFAULT...................... 88
12.1. Events of Default............................................. 88
12.2. Acceleration of Obligations; Termination of Commitment........ 90
12.3. Other Remedies................................................ 90
12.4. Setoff........................................................ 92
12.5. Remedies Cumulative; No Waiver................................ 93
Section 13. ADMINISTRATIVE AGENT........................................ 93
13.1. Appointment, Authority and Duties of Administrative Agent..... 93
13.2. Agreements Regarding Collateral and Examination Reports....... 95
13.3. Reliance By Administrative Agent.............................. 96
13.4. Action Upon Default........................................... 96
13.5. Ratable Sharing............................................... 97
13.6. Indemnification of Administrative Agent Indemnitees........... 97
13.7. Limitation on Responsibilities of Administrative Agent........ 98
13.8. Successor Administrative Agent and Co-Administrative Agents... 98
13.9. Consents, Amendments and Waivers; Out-of-Formula Loans....... 99
13.10. Due Diligence and Non-Reliance................................ 101
13.11. Representations and Warranties of Lenders..................... 101
13.12. The Required Lenders.......................................... 102
13.13. Several Obligations........................................... 102
13.14. Administrative Agent in its Individual Capacity............... 102
13.15. No Third Party Beneficiaries.................................. 102
13.16. Notice of Transfer............................................ 103
13.17. Replacement of Certain Lenders................................ 103
13.18. Remittance of Payments and Collections........................ 103
Section 14. BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS........ 104
14.1. Successors and Assigns........................................ 104
14.2. Participations................................................ 104
14.3. Assignments................................................... 105
14.4. Tax Treatment................................................. 106
Section 15. MISCELLANEOUS............................................... 107
15.1. Power of Attorney............................................. 107
15.2. General Indemnity............................................. 107
15.3. Survival of and Limitations Upon Indemnities.................. 108
15.4. Reserved...................................................... 108
15.5. Severability.................................................. 108
15.6. Cumulative Effect; Conflict of Terms.......................... 108
15.7. Counterparts; Facsimile Signatures............................ 108
15.8. Consent....................................................... 108
15.9. Notices and Communications.................................... 108
15.10. Performance of Borrowers' Obligations......................... 109
15.11. Credit Inquiries.............................................. 110
15.12. Time of Essence............................................... 110
15.13. Indulgences Not Waivers....................................... 110
15.14. Entire Agreement; Exhibits and Schedules...................... 110
15.15. Interpretation................................................ 110
15.16. Obligations of Lenders Several................................ 110
15.17. Confidentiality............................................... 110
15.18. Certifications Regarding Indentures........................... 111
15.20. Governing Law................................................. 111
15.22. Consent to Forum.............................................. 111
15.23. Waivers by Borrowers.......................................... 112
LIST OF EXHIBITS AND SCHEDULES
Exhibit A Form of Revolver Note
Exhibit C Form of Notice of Conversion/Continuation
Exhibit D Form of Notice of Borrowing
Exhibit E Form of Compliance Certificate
Exhibit G Form of Assignment and Acceptance
Exhibit H Form of Notice
Exhibit I Letter of Credit Request
Exhibit J Portfolio Interest Exemption Certificate
Exhibit K Form of Borrowing Base Certificate
Schedule 8.3 Listing of All Deposit Accounts
Schedule 9.1.4 Capital Structure of Borrowers
Schedule 9.1.5 Corporate Names
Schedule 9.1.6 Borrowers' Business Locations
Schedule 9.1.12 Surety Obligations
Schedule 9.1.13 Tax Identification Numbers of Borrowers and Subsidiaries
Schedule 9.1.18 Litigation
Schedule 9.1.21 Pension Plans
Schedule 9.1.22 Labor Contracts
Schedule 10.2.5 Permitted Liens