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EXHIBIT 10.8
CREDIT AGREEMENT
Dated as of September 30, 1999
among
THE BORROWERS FROM TIME TO TIME PARTY HERETO
HCR/ALTERRA DEVELOPMENT, LLC,
as Guarantor
THE SEVERAL LENDERS
FROM TIME TO TIME PARTY HERETO
BANK OF AMERICA, N. A.,
as Administrative Agent
THE CHASE MANHATTAN BANK,
as Syndication Agent
AND
DEUTSCHE BANK AG NEW YORK AND/OR CAYMAN ISLANDS BRANCHES and
BANK UNITED, F.S.B.
as Co-Agents
Arranged by:
BANC OF AMERICA SECURITIES LLC,
as Sole Lead Arranger and
Sole Book Manager
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TABLE OF CONTENTS
Page
SECTION 1 DEFINITIONS............................................................................................1
1.1 Definitions..........................................................................................1
1.2 Computation of Time Periods.........................................................................27
1.3 Accounting Terms....................................................................................27
SECTION 2 CREDIT FACILITIES.....................................................................................27
2.1Revolving Loans......................................................................................27
2.2Extension of Maturity Date...........................................................................30
2.3Additional Borrowers.................................................................................31
2.4Joint and Several Liability among Pool Borrowers.....................................................32
2.5Removal of a Borrower................................................................................38
2.6Appointment of Designated Borrower as Agent for Borrowers............................................38
SECTION 3 OTHER PROVISIONS RELATING TO CREDIT FACILITIES........................................................39
3.1Default Rate.........................................................................................39
3.2Extension and Conversion.............................................................................39
3.3Prepayments..........................................................................................40
3.4Termination and Reduction of Revolving Committed Amount..............................................41
3.5Fees.................................................................................................42
3.6Capital Adequacy.....................................................................................42
3.7Limitation on Eurodollar Loans.......................................................................43
3.8Illegality...........................................................................................43
3.9Requirements of Law..................................................................................44
3.10Treatment of Affected Loans.........................................................................45
3.11Taxes...............................................................................................45
3.12Compensation........................................................................................47
3.13Pro Rata Treatment..................................................................................48
3.14Sharing of Payments.................................................................................49
3.15Payments, Computations, Etc.........................................................................49
3.16Evidence of Debt....................................................................................53
3.17Substitution of Lenders.............................................................................54
SECTION 4 GUARANTY..............................................................................................55
4.1The Parent Guaranty..................................................................................55
4.2Obligations Unconditional............................................................................55
4.3Reinstatement........................................................................................57
4.4Certain Additional Waivers...........................................................................57
4.5Remedies.............................................................................................57
4.6Guarantee of Payment; Continuing Guarantee...........................................................57
SECTION 5 CONDITIONS............................................................................................58
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5.1 Closing Conditions..................................................................................58
5.2 Conditions to all Extensions of Credit..............................................................63
5.3 Conditions to Revolving Loans to Finance Construction or Refinancing of New Properties..............67
SECTION 6 REPRESENTATIONS AND WARRANTIES........................................................................67
6.1 Financial Condition.................................................................................67
6.2 No Material Change..................................................................................67
6.3 Organization and Good Standing......................................................................68
6.4 Power; Authorization; Enforceable Obligations.......................................................68
6.5 No Conflicts........................................................................................68
6.6 No Default..........................................................................................69
6.7 Ownership...........................................................................................69
6.8 Litigation..........................................................................................69
6.9 Taxes...............................................................................................69
6.10 Compliance with Law................................................................................69
6.11 ERISA..............................................................................................70
6.12 Subsidiaries.......................................................................................71
6.13 Governmental Regulations, Etc......................................................................71
6.14 Purpose of Loans...................................................................................72
6.15 Environmental Matters..............................................................................73
6.16 Intellectual Property..............................................................................74
6.17 Solvency...........................................................................................74
6.18 Location of Collateral.............................................................................74
6.19 Disclosure.........................................................................................74
6.20 No Burdensome Restrictions.........................................................................74
6.21 Labor Matters......................................................................................75
6.22 Year 2000 Compliance...............................................................................75
6.23 First Priority Lien................................................................................75
SECTION 7 AFFIRMATIVE COVENANTS.................................................................................75
7.1 Information Covenants...............................................................................75
7.2 Preservation of Existence and Franchises............................................................79
7.3 Books and Records...................................................................................79
7.4 Compliance with Law.................................................................................79
7.5 Payment of Taxes and Other Indebtedness.............................................................79
7.6 Insurance...........................................................................................79
7.7 Maintenance of Property.............................................................................81
7.8 Performance of Obligations..........................................................................81
7.9 Use of Proceeds.....................................................................................82
7.10 Audits/Inspections.................................................................................82
7.11 Financial Covenants................................................................................82
7.12 Environmental Laws.................................................................................82
7.13 Collateral.........................................................................................83
7.14 Year 2000 Compliance...............................................................................83
7.15 Construction Inspector.............................................................................84
7.16 Surveys............................................................................................84
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7.17 Environmental Indemnity............................................................................84
SECTION 8 NEGATIVE COVENANTS....................................................................................86
8.1 Indebtedness........................................................................................86
8.2 Liens...............................................................................................87
8.3 Nature of Business..................................................................................88
8.4 Consolidation, Merger, Dissolution, etc.............................................................88
8.5 Asset Dispositions..................................................................................88
8.6 Investments.........................................................................................89
8.7 Restricted Payments.................................................................................89
8.8 Prepayments of Indebtedness, etc....................................................................90
8.9 Transactions with Affiliates........................................................................90
8.10 Fiscal Year; Organizational Documents..............................................................90
8.11 Limitation on Restricted Actions...................................................................90
8.12 Sale Leasebacks....................................................................................91
8.13 No Further Negative Pledges........................................................................91
8.14 Construction.......................................................................................91
8.15 Changes to Plans and Specifications................................................................91
8.16 Transfer of Partnership Interests..................................................................92
SECTION 9 EVENTS OF DEFAULT.....................................................................................92
9.1 Events of Default...................................................................................92
9.2 Acceleration; Remedies..............................................................................99
SECTION 10 AGENCY PROVISIONS...................................................................................100
10.1 Appointment, Powers and Immunities................................................................100
10.2 Reliance by Administrative Agent..................................................................101
10.3 Defaults..........................................................................................102
10.4 Rights as a Lender................................................................................102
10.5 Indemnification...................................................................................102
10.6 Non-Reliance on Administrative Agent and Other Lenders............................................103
10.7 Successor Administrative Agent....................................................................103
SECTION 11 MISCELLANEOUS.......................................................................................104
11.1 Notices...........................................................................................104
11.2 Right of Set-Off; Adjustments.....................................................................106
11.3 Benefit of Agreement..............................................................................106
11.4 No Waiver; Remedies Cumulative....................................................................108
11.5 Expenses; Indemnification.........................................................................108
11.6 Amendments, Waivers and Consents..................................................................109
11.7 Counterparts......................................................................................111
11.8 Headings..........................................................................................111
11.9 Survival..........................................................................................111
11.10 Governing Law; Submission to Jurisdiction; Venue.................................................111
11.11 Severability..................................................................................112
11.12 Entirety......................................................................................112
11.13 Binding Effect; Termination...................................................................113
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11.14 Confidentiality...............................................................................113
11.15 Conflict......................................................................................113
11.16 Source of Funds...............................................................................113
11.17 Release of Liens..............................................................................114
SCHEDULES
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Schedule 1.1(a) Development Agreements
Schedule 1.1(b) Management Agreements
Schedule 1.1(c) Pool A Borrowers
Schedule 2.1(a)(i) Lenders
Schedule 2.1(a)(ii) Pool B Properties
Schedule 5.1(e)(i) Existing Properties
Schedule 6.12 Subsidiaries
Schedule 6.16 Intellectual Property
Schedule 6.18(a) Real Property Locations
Schedule 6.18(b) Personal Property Locations
Schedule 6.18(c) Chief Executive Offices/Principal Places of Business
Schedule 7.6 Insurance
Schedule 8.1(e) Subordinated Debt
EXHIBITS
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Exhibit 1.1(a) Form of Alterra Guaranty Agreement
Exhibit 1.1(b) Form of HCR Guaranty Agreement
Exhibit 2.1(b)(i) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Revolving Note
Exhibit 2.3(i) Form of Joinder Agreement
Exhibit 2.3(ii) Form of Pledge Supplement Agreement
Exhibit 3.2 Form of Notice of Extension/Conversion
Exhibit 7.1(d) Form of Officer's Compliance Certificate
Exhibit 7.1(f) Form of Borrowing Base Certificate
Exhibit 11.3(b) Form of Assignment and Acceptance
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of September 30, 1999 (as amended,
modified, restated or supplemented from time to time, the "Credit Agreement"),
is by and among the Borrowers (as defined herein), HCR/ALTERRA DEVELOPMENT, LLC,
a Delaware limited liability company (the "Parent"), the Lenders (as defined
herein), BANK OF AMERICA, N.A., as Administrative Agent for the Lenders (in such
capacity, the "Administrative Agent"), THE CHASE MANHATTAN BANK, as Syndication
Agent (in such capacity, the "Syndication Agent") and DEUTSCHE BANK AG NEW YORK
AND/OR CAYMAN ISLANDS BRANCHES and BANK UNITED, F.S.B., as Co-Agents (in such
capacity, the "Co-Agents").
W I T N E S S E T H
WHEREAS, the Borrowers have requested that the Lenders provide a
$200,000,000 credit facility for the purposes hereinafter set forth; and
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrowers on the terms and conditions hereinafter set forth;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION 1
DEFINITIONS
1.1 DEFINITIONS.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"Adjusted Base Rate" means the Base Rate plus the Applicable
Percentage.
"Adjusted Eurodollar Rate" means the Eurodollar Rate plus the
Applicable Percentage.
"Administrative Agent" shall have the meaning assigned to such
term in the heading hereof, together with any successors or assigns.
"Administrative Agent's Fee Letter" means that certain letter
agreement, dated as of June 11, 1999, between the Administrative Agent
and the Partners, as amended, modified, restated or supplemented from
time to time.
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"Administrative Agent's Fees" shall have the meaning assigned
to such term in Section 3.5(c).
"Affiliate" means, with respect to any Person, any other
Person (i) directly or indirectly controlling or controlled by or under
direct or indirect common control with such Person or (ii) directly or
indirectly owning or holding five percent (5%) or more of the Capital
Stock in such Person. For purposes of this definition, "control" when
used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative
to the foregoing.
"Agency Services Address" means Bank of America, N.A.,
Independence Center, 15th Floor, NC1-001-15-04, 101 N. Tryon Street,
Charlotte, North Carolina 28255, Attn: Agency Services, or such other
address as may be identified by written notice from the Administrative
Agent to the Borrowers.
"Alterra" means Alterra Healthcare Corporation, a Delaware
corporation.
"Alterra Guaranty Agreement" means the guaranty agreement
dated as of the Closing Date in the form of Exhibit 1.1(a) executed by
Alterra, as amended, modified, restated or supplemented from time to
time.
"Applicable Lending Office" means, for each Lender, the office
of such Lender (or of an Affiliate of such Lender) as such Lender may
from time to time specify to the Administrative Agent and the Borrowers
by written notice as the office by which its Eurodollar Loans are made
and maintained.
"Applicable Percentage" means, for any day, the rate per annum
set forth below opposite the applicable Senior Debt Rating then in
effect, it being understood that the Applicable Percentage for (i)
Eurodollar Loans shall be the percentage set forth under the column
"Applicable Percentage for Eurodollar Loans", (ii) Base Rate Loans
shall be the percentage set forth under the column "Applicable
Percentage for Base Rate Loans" and (iii) Unused Fee shall be the
percentage set forth under the column "Applicable Percentage for Unused
Fee". The Applicable Percentage shall be determined based on the Senior
Debt Rating; provided that (a) if either S&P or Moody's shall not have
a Senior Debt Rating for HCR, then the Applicable Percentages shall be
based on Pricing Level IV, (b) if there is a split Senior Debt Rating
with a difference of only one pricing level, then the higher of the two
ratings shall apply and (c) if there is a split Senior Debt Rating with
a difference of more than one pricing level, then the Applicable
Percentages shall be based on the Pricing Level one level below the
Pricing Level corresponding to the higher of the two ratings and both
of the actual Senior Debt Ratings will be disregarded.
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-------------- ------------------- ------------------ ------------------- ------------------ -------------------
Applicable Applicable Applicable
Percentage for Percentage for Percentage for
Pricing Moody's Rating Eurodollar Loans Base Rate Loans Unused Fee
Level S&P Rating
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
I >BBB+ >Baa1 1.125% .125% .225%
- -
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
II BBB Baa2 1.375% .375% .25%
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
III BBB- Baa3 1.75% .75% .375%
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
IV <BBB- <Baa3 2.50% 1.50% .50%
-------------- ------------------- ------------------ ------------------- ------------------ -------------------
The Applicable Percentages shall be determined and adjusted on the date
that the Senior Debt Rating changes (each a "Ratings Date"). Each
Applicable Percentage shall be effective from one Ratings Date until
the next Ratings Date. Any adjustment in the Applicable Percentages
shall be applicable to all existing Loans as well as any new Loans made
or issued.
"Applicant Borrower" shall have the meaning assigned to such
term in Section 2.3.
"As-Stabilized Appraised Value" means with respect to any
Eligible Project being constructed or refinanced by a Borrower using
proceeds of the Loans, the value (as determined pursuant to an
independent appraisal from an appraiser selected by the Administrative
Agent) of such Eligible Project.
"Asset Disposition" means the disposition of any or all of the
assets (including without limitation the Capital Stock of a Subsidiary)
of an Operative Party or any of its Subsidiaries whether by sale,
lease, transfer or otherwise (including pursuant to any casualty or
condemnation event).
"Bank of America" means Bank of America, N.A. and its
successors.
"Bankruptcy Code" means the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from
time to time.
"Bankruptcy Event" means, with respect to any Person, the
occurrence of any of the following with respect to such Person: (i) a
court or governmental agency having jurisdiction in the premises shall
enter a decree or order for relief in respect of such Person in an
involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or similar
official) of such Person or for any substantial part of its Property or
ordering the winding up or liquidation of its affairs; or (ii) there
shall be commenced against such Person an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or any case, proceeding or other action for the appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of its
Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed, undischarged or unbonded for a period of sixty (60)
consecutive
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days; or (iii) such Person shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment
or taking possession by a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of such Person or for any
substantial part of its Property or make any general assignment for the
benefit of creditors; or (iv) such Person shall be unable to, or shall
admit in writing its inability to, pay its debts generally as they
become due.
"Base Rate" means, for any day, the rate per annum equal to
the higher of (a) the Federal Funds Rate for such day plus one-half of
one percent (0.5%) and (b) the Prime Rate for such day. Any change in
the Base Rate due to a change in the Prime Rate or the Federal Funds
Rate shall be effective on the effective date of such change in the
Prime Rate or Federal Funds Rate.
"Base Rate Loan" means any Loan bearing interest at a rate
determined by reference to the Base Rate.
"Borrowers" means a collective reference to the Pool A
Borrowers, the Pool B Borrowers and the Pool C Borrowers, and
"Borrower" means any one of them.
"Borrowing Base" means, at any date of determination, the sum
of the Eligible Project Loan Amounts for the Eligible Projects.
"Borrowing Base Certificate" means a Borrowing Base
Certificate substantially in the form of Exhibit 7.1(f).
"Businesses" shall have the meaning set forth in Section 6.15.
"Business Day" means a day other than a Saturday, Sunday or
other day on which commercial banks in Charlotte, North Carolina or San
Francisco, California are authorized or required by law to close,
except that, when used in connection with a Eurodollar Loan, such day
shall also be a day on which dealings between banks are carried on in
U.S. dollar deposits in London, England.
"Capital Lease" means, as applied to any Person, any lease of
any Property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a
capital lease on the balance sheet of that Person.
"Capital Stock" means (i) in the case of a corporation,
capital stock, (ii) in the case of an association or business entity,
any and all shares, interests, participations, rights or other
equivalents (however designated) of capital stock, (iii) in the case of
a partnership, partnership interests (whether general or limited), (iv)
in the case of a limited liability company, membership interests and
(v) any other interest or participation that confers on a Person the
right to receive a share of the profits and losses of, or distributions
of assets of, the issuing Person.
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"Cash Equivalents" means (a) securities issued or directly and
fully guaranteed or insured by the United States of America or any
agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof)
having maturities of not more than twelve months from the date of
acquisition, (b) U.S. dollar denominated time deposits and certificates
of deposit of (i) any Lender, (ii) any domestic commercial bank of
recognized standing having capital and surplus in excess of
$500,000,000 or (iii) any bank whose short-term commercial paper rating
(or its parent's short-term commercial paper rating) from S&P is at
least A-1 or the equivalent thereof or from Moody's is at least P-1 or
the equivalent thereof (any such bank being an "Approved Bank"), in
each case with maturities of not more than 365 days from the date of
acquisition, (c) commercial paper and variable or fixed rate notes
issued by any Approved Bank (or by the parent company thereof) or any
variable rate notes issued by, or guaranteed by, any domestic
corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing
within twelve months of the date of acquisition, (d) repurchase
agreements entered into by any Person with a bank or trust company
(including any of the Lenders) or recognized securities dealer having
capital and surplus in excess of $500,000,000 for direct obligations
issued by or fully guaranteed by the United States of America in which
such Person shall have a perfected first priority security interest
(subject to no other Liens) and having, on the date of purchase
thereof, a fair market value of at least 100% of the amount of the
repurchase obligations and (e) Investments, classified in accordance
with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which
are administered by reputable financial institutions having capital of
at least $500,000,000 and the portfolios of which are limited to
Investments of the character described in the foregoing subdivisions
(a) through (d).
"Change of Control" means the occurrence of any of the
following events:
(i) HCR shall fail to own and have the right to vote
fifty percent (50%) of the outstanding Voting Stock of the
Parent,
(ii) Alterra shall fail to own and have the right to
vote fifty percent (50%) of the outstanding Voting Stock of
the Parent,
(iii) subject to the terms of Section 8.16, the
Parent shall fail to own and have the right to vote at least
ten percent (10%) of the outstanding Voting Stock of each of
the Pool A Borrowers,
(iv) the Parent shall fail to own and have the right
to vote at least ten percent (10%) of the outstanding Voting
Stock of each of the Pool B Borrowers or
(v) the Parent shall fail to own and have the right
to vote at least ten percent (10%) of the outstanding Voting
Stock of each of the Pool C Borrowers.
"Clare Bridge Jefferson" means Clare Bridge of Jefferson
Township L.P., a Delaware limited partnership.
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"Clare Bridge Palos Heights" means Clare Bridge of Palos
Heights L.P., a Delaware limited partnership.
"Clare Bridge Parma" means Clare Bridge of Parma L.P., a
Delaware limited partnership.
"Clare Bridge Westchase" means Clare Bridge of Westchase L.P.,
a Delaware limited partnership.
"Closing Date" means the date hereof.
"Co-Agents" shall have the meaning assigned to such term in
the heading hereof, together with any successors and assigns.
"Code" means the Internal Revenue Code of 1986, as amended,
and any successor statute thereto, as interpreted by the rules and
regulations issued thereunder, in each case as in effect from time to
time. References to sections of the Code shall be construed also to
refer to any successor sections.
"Collateral" means a collective reference to the collateral
which is identified in, and at any time will be covered by, the
Collateral Documents.
"Collateral Documents" means a collective reference to the
Security Agreements, the Pledge Agreement, the Mortgage Documents and
such other documents executed and delivered in connection with the
attachment and perfection of the Administrative Agent's security
interests and liens arising thereunder, including without limitation,
UCC financing statements.
"Commitment" means with respect to each Lender, the Revolving
Commitment of such Lender.
"Credit Documents" means a collective reference to this Credit
Agreement, the Notes, the Alterra Guaranty Agreement, the HCR Guaranty
Agreement, each Joinder Agreement, the Administrative Agent's Fee
Letter, the Collateral Documents and all other related agreements and
documents issued or delivered hereunder or thereunder or pursuant
hereto or thereto (in each case as the same may be amended, modified,
restated, supplemented, extended, renewed or replaced from time to
time), and "Credit Document" means any one of them.
"Credit Parties" means a collective reference to the Borrowers
and the Guarantors, and "Credit Party" means any one of them.
"Credit Party Obligations" means, without duplication, (i) all
of the obligations of the Credit Parties to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement,
the Notes, the Guaranty Agreements, the Collateral Documents or any of
the other Credit Documents (including, but not limited to, any interest
accruing after the
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occurrence of a Bankruptcy Event with respect to any Credit Party,
regardless of whether such interest is an allowed claim under the
Bankruptcy Code) and (ii) all liabilities and obligations, whenever
arising, owing from any Borrower to any Lender, or any Affiliate of a
Lender, arising under any Hedging Agreement.
"Debt Service" means, as of any date for the four fiscal
quarter period ending on such date, with respect to any Eligible
Project, the principal and interest payments which would be due and
payable during such four fiscal quarter period (assuming (A) a mortgage
style amortization schedule for a loan equal to such Eligible Project's
Eligible Project Loan Amount (as of the last day of the fiscal quarter
ending five full fiscal quarters following the date of the first
resident occupancy at such Eligible Project) with a term of twenty-five
years and (B) an interest rate equal to the greater of (a) 7.5% per
annum and (b) the then applicable Treasury Rate plus 2.00% per annum).
"Debt Service Coverage Ratio" means, as of the last day of any
fiscal quarter, with respect to any Eligible Project, the ratio of (a)
the Net Operating Income for such Eligible Project to (b) the Debt
Service for such Eligible Project. Notwithstanding the foregoing, (i)
for purposes of calculating the Debt Service Coverage Ratio of an
Eligible Project that has been in operation for five full fiscal
quarters following the date of the first resident occupancy of the
Facility, the Net Operating Income for the four fiscal quarter period
for which Net Operating Income is being calculated shall be deemed to
be the result obtained by multiplying the actual Net Operating Income
of such Eligible Project for the three month period ending as of the
last day of the applicable fiscal quarter end by 4, (ii) for purposes
of calculating the Debt Service Coverage Ratio of an Eligible Project
that has been in operation for six full fiscal quarters following the
date of the first resident occupancy of the Facility, the Net Operating
Income for the four fiscal quarter period for which Net Operating
Income is being calculated shall be deemed to be the result obtained by
multiplying the actual Net Operating Income of such Eligible Project
for the six month period ending as of the last day of the applicable
fiscal quarter end by 2 and (iii) for purposes of calculating the Debt
Service Coverage Ratio of an Eligible Project that has been in
operation for seven full fiscal quarters following the date of the
first resident occupancy of the Facility, the Net Operating Income for
the four fiscal quarter period for which Net Operating Income is being
calculated shall be deemed to be the result obtained by multiplying the
actual Net Operating Income of such Eligible Project for the nine month
period ending as of the last day of the applicable fiscal quarter end
by 1 1/3.
"Default" means any event, act or condition which with notice
or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" means, at any time, any Lender that (a)
has failed to make a Loan or purchase a Participation Interest required
pursuant to the term of this Credit Agreement within one Business Day
of when due, (b) other than as set forth in (a) above, has failed to
pay to the Administrative Agent or any Lender an amount owed by such
Lender pursuant to the terms of this Credit Agreement within one
Business Day of when due, unless such amount is subject to a good faith
dispute or (c) has been deemed insolvent or has become subject to a
bankruptcy or insolvency proceeding or with respect to which (or
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with respect to any of assets of which) a receiver, trustee or similar
official has been appointed.
"Designated Borrowers" means a collective reference to the
Pool A Designated Borrower, the Pool B Designated Borrower and the Pool
C Designated Borrower, and "Designated Borrower" means any one of them.
"Development Agreements" means a collective reference to the
development agreements identified on Schedule 1.1(a) and any additional
development agreements entered into by a Borrower and HCR or Alterra,
as applicable, with respect to an Eligible Project, and "Development
Agreement" means any one of them.
"Development Budget" means (i) with respect to any Eligible
Project which will be constructed using proceeds of the Loans, the
detailed budget of the cost of the acquisition, if applicable,
development, construction and working capital of such Eligible Project
which has been (a) reviewed by the Engineer and (b) recommended by the
Engineer to the Administrative Agent as an acceptable budget prior to
commencement of construction and (ii) with respect to any Eligible
Project which will be refinanced using proceeds of the Loans, the
detailed budget of the cost of development, construction and working
capital of such Eligible Project which has been (a) reviewed by the
Engineer and (b) recommended by the Engineer to the Administrative
Agent as an acceptable budget prior to such refinancing.
"Dollars" and "$" means dollars in lawful currency of the
United States of America.
"Domestic Subsidiary" means, with respect to any Person, any
Subsidiary of such Person which is incorporated or organized under the
laws of any State of the United States or the District of Columbia.
"Eligible Assignee" means (i) a Lender; (ii) an Affiliate of a
Lender or any fund that invests in bank loans and is managed by an
investment advisor to a Lender; and (iii) any other commercial bank,
financial institution, other "accredited investor" (as defined in
Regulation D of the Securities Act of 1933, as amended) or "qualified
institutional buyer" (as defined in Rule 144A of the Securities Act of
1933, as amended) approved by the Administrative Agent and, unless an
Event of Default has occurred and is continuing at the time any
assignment is effected in accordance with Section 11.3, the Designated
Borrowers (such approval by the Administrative Agent or the Designated
Borrowers not to be unreasonably withheld or delayed and such approval
to be deemed given by the Designated Borrowers if no objection is
received by the assigning Lender and the Administrative Agent from the
Designated Borrowers within two Business Days after notice of such
proposed assignment has been provided by the assigning Lender to the
Designated Borrowers); provided, however, that neither a Credit Party
nor an Affiliate of any Credit Party shall qualify as an Eligible
Assignee.
"Eligible Project" means any Facility that (i)(a) has been
proposed to be acquired and/or constructed by a Borrower using proceeds
of the Loans or (b) is owned by such
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Borrower and has been proposed to be refinanced by such Borrower using
the proceeds of the Loans and (ii) satisfies each of following
conditions:
(a) such Facility shall be located or is located, as
applicable, within HCR's Core Market;
(b) except for the Facilities located on the Pool B
Properties identified on Schedule 2.1(a)(ii), the
Administrative Agent shall have received an appraisal (in form
and substance satisfactory to the Administrative Agent) with
respect to such Facility from a qualified appraiser
satisfactory to the Administrative Agent (if the
Administrative Agent does not receive an appraisal for any of
Pool B Properties identified on Schedule 2.1(a)(ii) in
accordance with the terms of Section 7.l8, such Facilities
located on such Pool B Properties shall cease to be Eligible
Projects) and;
(c) the Administrative Agent shall have received an
environmental assessment (in form and substance satisfactory
to the Administrative Agent) of the property where such
Facility will be constructed or is located, as applicable,
from a consulting firm acceptable to the Administrative Agent;
(d) for each Facility to be constructed using
proceeds of the Loans, the Administrative Agent shall have
received a set of plans and specifications for the
construction of such Facility in form and substance
satisfactory to the Administrative Agent;
(e) for each Facility (other than the Facilities
owned by the Initial Pool A Borrowers), the Engineer and the
Administrative Agent shall have received a Development Budget
for such Facility, and the Engineer shall have recommended to
the Administrative Agent that such Development Budget is
satisfactory in form and substance to the Engineer (the
Lenders have agreed to accept the Development Budgets provided
to the Administrative Agent for the Facilities owned by the
Initial Pool A Borrowers);
(f) (i) for each Facility to be constructed using
proceeds of the Loans, the Administrative Agent shall have
received projections for such Facility for the two year period
subsequent to its construction completion date satisfactory in
form and substance to the Administrative Agent and (ii) for
each Facility to be refinanced using proceeds of the Loans,
the Administrative Agent shall have received satisfactory
projections for such Facility for the two year period
subsequent to the refinancing satisfactory in form and
substance to the Administrative Agent;
(g) the Administrative Agent shall have received, in
form and substance satisfactory to the Administrative Agent, a
fully executed and notarized Mortgage in favor of the
Administrative Agent encumbering the ownership interest of the
applicable Borrower in the property where such Facility is
located, together with
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such UCC-1 financing statements as the Administrative Agent
shall deem appropriate with respect to the property;
(h) the Administrative Agent shall have received, in
form and substance reasonably satisfactory to the
Administrative Agent, an opinion of counsel in the state in
which such Facility is located with respect to the
enforceability of the form of Mortgage and sufficiency of the
form of UCC-1 financing statements to be recorded or filed in
such state and such other matters as the Administrative Agent
may request, in form and substance reasonably satisfactory to
the Administrative Agent;
(i) the Administrative Agent shall have received, in
form and substance reasonably satisfactory to the
Administrative Agent, a title insurance policy from a title
insurer reasonably satisfactory to the Administrative Agent in
an amount satisfactory to the Administrative Agent with
respect to the property where such Facility is located,
assuring the Administrative Agent that the applicable Mortgage
creates a valid and enforceable first priority mortgage lien
on the property where such Facility is located, free and clear
of all defects and encumbrances except Permitted Liens, such
title insurance policy to contain such coverage and
endorsements as shall be reasonably satisfactory to the
Administrative Agent, all of the foregoing in form and
substance reasonably satisfactory to the Administrative Agent;
(j) the Administrative Agent shall have received, in
form and substance satisfactory to the Administrative Agent,
map or plat of a survey of the site of the property where such
Facility is located certified to the Administrative Agent and
the applicable title insurer in a manner satisfactory to them,
dated a date satisfactory to the Administrative Agent and the
applicable title insurer by an independent professional
licensed land surveyor reasonably satisfactory to the
Administrative Agent and the applicable title insurer, and
otherwise in form and substance satisfactory to the
Administrative Agent;
(k) the Administrative Agent shall have received, in
form and substance satisfactory to the Administrative Agent, a
current certification from the applicable Borrower's
registered engineer land surveyor as to whether such Facility
or any other improvements on the applicable property are
located within any area designated by the Director of the
Federal Emergency Management Agency as a "special flood
hazard" area and if any improvements on such parcel are
located within a "special flood hazard" area, evidence of a
flood insurance policy from a company and in an amount
satisfactory to the Administrative Agent for the applicable
portion of the property, naming the Administrative Agent, for
the benefit of the Lenders, as mortgagee;
(l) the Administrative Agent shall have received, in
form and substance satisfactory to the Administrative Agent, a
subordination and assignment of management agreement with
respect to such Facility;
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(m) (i) with respect to each Facility owned by a Pool
A Borrower, the Administrative Agent shall have received
documents to ensure that such Facility secures the obligations
of all Pool A Borrowers under the Credit Documents, (ii) with
respect to each Facility owned by a Pool B Borrower, the
Administrative Agent shall have received documents to ensure
that such Facility secures the obligations of all Pool B
Borrowers under the Credit Documents and (iii) with respect to
each Facility owned by a Pool C Borrower, the Administrative
Agent shall have received documents to ensure that such
Facility secures the obligations of all Pool C Borrowers under
the Credit Documents;
(n) the Administrative Agent shall have received a
certified copy of the construction contract with respect to
such Facility; and
(o) the Administrative Agent shall have received a
certified copy of the Management Agreement with respect to
such Facility.
Notwithstanding the foregoing, if a Facility satisfies each of the
conditions identified in subclauses (a) through (o) above of this
definition of "Eligible Project" but is not fully constructed and open
for business within fifteen months of the commencement of construction
of such Facility, such Facility shall no longer be considered an
Eligible Project for purposes of this Credit Agreement.
"Eligible Project Loan Amount" means, at any date of
determination with respect to an Eligible Project, an amount for such
Eligible Project equal to the lesser of:
(a) 75% of such Eligible Project's As-Stabilized
Appraised Value; and
(b) 80% of that portion of such Eligible
Project's Development Budget which has been
incurred to date.
Notwithstanding the foregoing, with respect to any Eligible Project
identified on Schedule 2.1(a)(ii), the Eligible Project Loan Amount for
such Eligible Project shall be based solely on 80% of that portion of
such Eligible Project's Development Budget which has been incurred to
date until such time as the appraisal for such Eligible Project is
delivered to the Administrative Agent in accordance with the terms of
Section 7.18
"Engineer" means PACS, Inc. who will serve as the
Administrative Agent's engineer responsible for (i) reviewing the
Development Budgets submitted by the Borrowers pursuant to the terms
hereof and (ii) making a recommendation to the Administrative Agent as
to whether or not a particular Development Budget is satisfactory in
form and substance.
"Environmental Laws" means any and all lawful and applicable
Federal, state, local and foreign statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions,
grants, franchises, licenses, agreements or other governmental
restrictions relating to the environment or to emissions, discharges,
releases or threatened
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releases of pollutants, contaminants, chemicals, or industrial, toxic
or hazardous substances or wastes into the environment including,
without limitation, ambient air, surface water, ground water, or land,
or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and any successor statute thereto, as interpreted by
the rules and regulations thereunder, all as the same may be in effect
from time to time. References to sections of ERISA shall be construed
also to refer to any successor sections.
"ERISA Affiliate" means an entity which is under common
control with any Operative Party or any of its Subsidiaries within the
meaning of Section 4001(a)(14) of ERISA, or is a member of a group
which includes any Operative Party or any of its Subsidiaries and which
is treated as a single employer under Sections 414(b) or (c) of the
Code.
"ERISA Event" means (i) with respect to any Plan, the
occurrence of a Reportable Event or the substantial cessation of
operations (within the meaning of Section 4062(e) of ERISA); (ii) the
withdrawal by any Operative Party or any of its Subsidiaries or any
ERISA Affiliate from a Multiple Employer Plan during a plan year in
which it was a substantial employer (as such term is defined in Section
4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan;
(iii) the distribution of a notice of intent to terminate or the actual
termination of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA;
(iv) the institution of proceedings to terminate or the actual
termination of a Plan by the PBGC under Section 4042 of ERISA; (v) any
event or condition which might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Plan; (vi) the complete or partial withdrawal of any
Operative Party or any of its Subsidiaries or any ERISA Affiliate from
a Multiemployer Plan; (vii) the conditions for imposition of a lien
under Section 302(f) of ERISA exist with respect to any Plan; or (viii)
the adoption of an amendment to any Plan requiring the provision of
security to such Plan pursuant to Section 307 of ERISA.
"Eurodollar Loan" means any Loan that bears interest at a rate
based upon the Eurodollar Rate.
"Eurodollar Rate" means, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined by the Administrative
Agent to be equal to the quotient obtained by dividing (a) the
Interbank Offered Rate for such Eurodollar Loan for such Interest
Period by (b) 1 minus the Eurodollar Reserve Requirement for such
Eurodollar Loan for such Interest Period.
"Eurodollar Reserve Requirement" means, at any time, the
maximum rate at which reserves (including, without limitation, any
marginal, special, supplemental, or emergency reserves) are required to
be maintained under regulations issued from time to time by the Board
of Governors of the Federal Reserve System (or any successor) by member
banks of
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the Federal Reserve System against "Eurodollar liabilities" (as such
term is used in Regulation D). Without limiting the effect of the
foregoing, the Eurodollar Reserve Requirement shall reflect any other
reserves required to be maintained by such member banks with respect to
(i) any category of liabilities which includes deposits by reference to
which the Adjusted Eurodollar Rate is to be determined, or (ii) any
category of extensions of credit or other assets which include
Eurodollar Loans. The Adjusted Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the
Eurodollar Reserve Requirement.
"Event of Default" shall have the meaning as defined in
Section 9.1(a).
"Executive Officer" of any Person means any of the chief
executive officer, chief operating officer, president, vice president,
chief financial officer or treasurer of such Person.
"Existing Properties" shall have the meaning set forth in
Section 5.1(e)(i).
"Facility" and "Facilities" means, individually or
collectively, an assisted living facility, alzheimers or dementia care
facility or independent living facility owned or to be developed by one
of the Borrowers.
"Fees" means all fees payable pursuant to Section 3.5.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) equal to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day; provided
that (a) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and
(b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate
charged to the Administrative Agent (in its individual capacity) on
such day on such transactions as determined by the Administrative
Agent.
"GAAP" means generally accepted accounting principles in the
United States applied on a consistent basis and subject to the terms of
Section 1.3.
"Governmental Authority" means any Federal, state, local or
foreign court or governmental agency, authority, instrumentality or
regulatory body.
"Guarantors" means a collective reference to HCR, Alterra and
the Parent, and "Guarantor" means any one of them.
"Guaranty Agreements" means a collective reference to the
Alterra Guaranty Agreement and the HCR Guaranty Agreement.
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"Guaranty Obligations" means, with respect to any Person,
without duplication, any obligations of such Person (other than
endorsements in the ordinary course of business of negotiable
instruments for deposit or collection) guaranteeing or intended to
guarantee any Indebtedness of any other Person in any manner, whether
direct or indirect, and including without limitation any obligation,
whether or not contingent, (i) to purchase any such Indebtedness or any
Property constituting security therefor, (ii) to advance or provide
funds or other support for the payment or purchase of any such
Indebtedness or to maintain working capital, solvency or other balance
sheet condition of such other Person (including without limitation keep
well agreements, maintenance agreements, comfort letters or similar
agreements or arrangements) for the benefit of any holder of
Indebtedness of such other Person, (iii) to lease or purchase Property,
securities or services primarily for the purpose of assuring the holder
of such Indebtedness, or (iv) to otherwise assure or hold harmless the
holder of such Indebtedness against loss in respect thereof. The amount
of any Guaranty Obligation hereunder shall (subject to any limitations
set forth therein) be deemed to be an amount equal to the outstanding
principal amount (or maximum principal amount, if larger) of the
Indebtedness in respect of which such Guaranty Obligation is made.
"HCR" means Manor Care, Inc. (formerly known as HCR Manor
Care, Inc.), a Delaware corporation.
"HCR's Core Market" means any geographic area falling within a
fifty mile radius of any assisted living, dementia care or long-term
care facility operated, at the time of determination, by HCR, Alterra
or their respective controlled affiliates within the states of
Connecticut, Delaware, Florida, Illinois, Indiana, Kentucky, Maryland,
Michigan, New Jersey, New York, Ohio, Pennsylvania, Texas, Virginia and
Wisconsin.
"HCR Credit Agreement" means, that certain Credit Agreement
dated as of September 25, 1998 among HCR, Manor Care, Bank of America,
as administrative agent, The Chase Manhattan Bank, as syndication
agent, TD Securities (USA) Inc., as documentation agent and the other
financial institutions party thereto, as amended, modified,
supplemented or restated from time to time.
"HCR Guaranty Agreement" means the guaranty agreement dated as
of the Closing Date in the form of Exhibit 1.1(b) executed by HCR, as
amended, modified, restated or supplemented from time to time.
"Health Care Retirement Corporation" means Health Care and
Retirement Corporation of America (a wholly-owned subsidiary of HCR),
an Ohio corporation.
"Hedging Agreement" means any interest rate protection
agreement or foreign currency exchange agreement.
"Indebtedness" means, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b)
all obligations of such Person evidenced by bonds, debentures, notes or
similar instruments, or upon which interest payments are
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customarily made, (c) all obligations of such Person under conditional
sale or other title retention agreements relating to Property purchased
by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary
course of business), (d) all obligations of such Person issued or
assumed as the deferred purchase price of Property or services
purchased by such Person (other than trade debt incurred in the
ordinary course of business and due within six months of the incurrence
thereof or such longer period, if the payment of which is being
contested in good faith) which would appear as liabilities on a balance
sheet of such Person, (e) all obligations of such Person under
take-or-pay or similar arrangements or under commodities agreements,
(f) all Indebtedness of others secured by (or for which the holder of
such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production
from, Property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (g) all Guaranty
Obligations of such Person, (h) the principal portion of all
obligations of such Person under Capital Leases, (i) all obligations of
such Person under Hedging Agreements, (j) all obligations of such
Person to repurchase any securities which repurchase obligation is
related to the issuance thereof, (k) the maximum amount of all standby
letters of credit issued or bankers' acceptances facilities created for
the account of such Person and, without duplication, all drafts drawn
thereunder (to the extent unreimbursed), (l) all preferred Capital
Stock issued by such Person and required by the terms thereof to be
redeemed, or for which mandatory sinking fund payments are due, by a
fixed date, (m) all other obligations of such person under any
arrangement or financing structure classified as debt (for tax
purposes) by any nationally recognized rating agency, (n) the principal
portion of all obligations of such Person under Synthetic Leases and
(o) the Indebtedness of any partnership or unincorporated joint venture
in which such Person is a general partner or a joint venturer.
"Initial Pool A Borrowers" means a collective reference to the
Pool A Borrowers identified on Schedule 1.1(c).
"Initial Pool A Subordinated Debt" means the unsecured
indebtedness in the amounts identified on Schedule 8.1(e) incurred by
each of the Initial Pool A Borrowers (other than Clare Bridge Parma and
Clare Bridge Westchase) pursuant to promissory notes satisfactory in
form and substance to the Administrative Agent.
"Interbank Offered Rate" means, for any Eurodollar Loan for
any Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) 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) two
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 term "Interbank Offered Rate" shall mean, for any
Eurodollar Loan for any Interest Period therefor, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100 of 1%) appearing
on Reuters Screen LIBO Page as the London interbank offered rate for
deposits in Dollars at approximately 11:00 a.m. (London time) two
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
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Screen LIBO Page, the applicable rate shall be the arithmetic mean of
all such rates (rounded upwards, if necessary, to the nearest 1/100 of
1%).
"Interest Payment Date" means (a) as to Base Rate Loans, the
last day of each calendar month, the date of repayment of principal of
such Loan and the Maturity Date, and (b) as to Eurodollar Loans, the
last day of each applicable Interest Period, the date of repayment of
principal of such Loan and the Maturity Date, and in addition where the
applicable Interest Period for a Eurodollar Loan is greater than three
months, then also the date three months from the beginning of the
Interest Period and each three months thereafter.
"Interest Period" means, as to Eurodollar Loans, a period of
one, two, three or six months' duration, as the applicable Designated
Borrower may elect, commencing, in each case, on the date of the
borrowing (including continuations and conversions thereof); provided,
however, (a) if any Interest Period would end on a day which is not a
Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that where the next succeeding Business
Day falls in the next succeeding calendar month, then on the next
preceding Business Day), (b) no Interest Period shall extend beyond the
Maturity Date and (c) where an Interest Period begins on a day for
which there is no numerically corresponding day in the calendar month
in which the Interest Period is to end, such Interest Period shall end
on the last Business Day of such calendar month.
"Investment" means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or
otherwise) of assets, Capital Stock, bonds, notes, debentures,
partnership, joint ventures or other ownership interests or other
securities of any Person or (b) any deposit with, or advance, loan or
other extension of credit to, any Person (other than (i) deposits made
in connection with the purchase of services, equipment or other assets
in the ordinary course of business and (ii) trade debt) or (c) any
other capital contribution to or investment in any Person, including,
without limitation, any Guaranty Obligations (including any support for
a letter of credit issued on behalf of such Person) incurred for the
benefit of such Person.
"Joinder Agreement" means a Joinder Agreement substantially in
the form of Exhibit 2.3(i) hereto, executed and delivered by an
Applicant Borrower in accordance with the provisions of Section 2.3.
"Lender" means any of the Persons identified as a "Lender" on
the signature pages hereto, and any Person which may become a Lender by
way of assignment in accordance with the terms hereof, together with
their successors and permitted assigns.
"Lien" means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference, priority or charge of any kind (including any
agreement to give any of the foregoing, any conditional sale or other
title retention agreement, any financing or similar statement or notice
filed under the Uniform Commercial Code as adopted and in effect in the
relevant jurisdiction or other similar recording or notice statute, and
any lease in the nature thereof).
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"Loan" or "Loans" means the Revolving Loans (or a portion of
any Revolving Loan bearing interest at the Adjusted Base Rate or the
Adjusted Eurodollar Rate) individually or collectively, as appropriate.
"Management Agreements" means a collective reference to the
management agreements identified on Schedule 1.1(b) and any additional
management agreements entered into by a Borrower and Alterra with
respect to an Eligible Project, and "Management Agreement" means any
one of them.
"Manor Care" means Manor Care of America, Inc. (formerly
known as Manor Care, Inc.), a Delaware corporation.
"Material Adverse Effect" means a material adverse effect on
(i) the condition (financial or otherwise), operations, business,
assets or liabilities of HCR and its Subsidiaries taken as a whole,
(ii) the condition (financial or otherwise), operations, business,
assets or liabilities of Alterra and its Subsidiaries taken as a whole,
(iii) the condition (financial or otherwise), operations, business,
assets, liabilities or prospects of any Operative Party or any of its
Subsidiaries, (iv) the ability of any Credit Party to perform any
material obligation under the Credit Documents to which it is a party
or (v) the material rights and remedies of the Lenders under the Credit
Documents.
"Materials of Environmental Concern" means any gasoline or
petroleum (including crude oil or any fraction thereof) or petroleum
products or any hazardous or toxic substances, materials or wastes,
defined or regulated as such in or under any Environmental Laws,
including, without limitation, asbestos, polychlorinated biphenyls and
urea-formaldehyde insulation.
"Maturity Date" means September 30, 2002, as such date may be
extended pursuant to Section 2.2.
"Moody's" means Moody's Investors Service, Inc., or any
successor or assignee of the business of such company in the business
of rating securities.
"Mortgage" shall have the meaning given to such term in
Section 5.1(e)(i).
"Mortgage Policy" shall have the meaning given to such term in
Section 5.1(e)(ii).
"Multiemployer Plan" means a Plan which is a multiemployer
plan as defined in Sections 3(37) or 4001(a)(3) of ERISA.
"Multiple Employer Plan" means a Plan which any Operative
Party or any of its Subsidiaries or any ERISA Affiliate and at least
one employer other than an Operative Party or any of its Subsidiaries
or any ERISA Affiliate are contributing sponsors.
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"Net Operating Income" means, as of any date for the four
fiscal quarter period ending on such date with respect to any Eligible
Project, the amount equal to (a) the total operating revenue with
respect to the operation of such Eligible Project for such period less
(b) total operating expenses with respect to the operation of such
Eligible Project for such period (excluding any (i) management fees or
(ii) interest paid during such period with respect to Loans used to
construct and/or develop such Eligible Project) plus (c) an amount
which, in the determination of total operating expenses for such period
has been deducted for (i) total taxes with respect to such Eligible
Project for such period and (ii) depreciation and amortization with
respect to such Eligible Project for such period less (d) a replacement
reserve equal to $250 per year per bed in such Eligible Project less
(e) an amount equal to 5% of total operating revenue with respect to
the operation of such Eligible Project for such period.
"New Property" means any Facility owned by a Borrower which
qualifies as an Eligible Project subsequent to the Closing Date.
"Note" or "Notes" means the Revolving Notes, individually or
collectively, as appropriate.
"Notice of Borrowing" means a written notice of borrowing in
substantially the form of Exhibit 2.1(b)(i), as required by Section
2.1(b)(i).
"Notice of Extension/Conversion" means the written notice of
extension or conversion in substantially the form of Exhibit 3.2, as
required by Section 3.2.
"Occupancy Rate" means for each Eligible Project, the ratio
(expressed as a percentage) equal to (a) the number of individuals
paying fees pursuant to a residency agreement entitling them to
residency at such Eligible Project to (b) the pro forma resident
occupancy for such Eligible Project, as contained in the projections
for such Eligible Project reviewed and approved by the Administrative
Agent at the time such Facility is admitted as an Eligible Project.
"Operating Lease" means, as applied to any Person, any lease
(including, without limitation, leases which may be terminated by the
lessee at any time) of any Property (whether real, personal or mixed)
which is not a Capital Lease other than any such lease in which that
Person is the lessor.
"Operative Parties" means a collective reference to the
Borrowers and the Parent, and "Operative Party" means any one of them.
"Other Taxes" shall have the meaning assigned to such term in
Section 3.11.
"Parent" means HCR/Alterra Development, LLC, a Delaware
limited liability company.
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"Parma Vacant Land" means that certain vacant portion of land
at the Existing Property in Parma, Ohio, generally located west of the
East Ohio Gas Easement (as shown on the current survey of the Existing
Property in Parma, Ohio), which, prior to its release pursuant to
Section 11.7(a), is to be identified to the Administrative Agent
pursuant to a metes and bounds legal description and survey
satisfactory in form and substance to the Administrative Agent.
"Participation Interest" means a purchase by a Lender in any
Loans as provided in Section 3.14.
"Partners" means the collective reference to HCR and
Alterra and "Partner" means any one of them.
"PBGC" means the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA and any
successor thereof.
"Permitted Investments" means Investments which are either (i)
cash and Cash Equivalents; (ii) accounts receivable created, acquired
or made by any Operative Party in the ordinary course of business and
payable or dischargeable in accordance with customary trade terms;
(iii) equity investments by the Parent in any Pool A Borrower; (iv)
equity investments by the Parent in any Pool B Borrower, (v) equity
investments by the Parent in any Pool C Borrower and (vi) equity
investments by the Parent in Clare Bridge Palos Heights so long as (A)
Clare Bridge Palos Heights becomes a Borrower hereunder in accordance
with the terms of Section 2.3 on or before December 31, 1999 and (B)
the real property presently owned by Clare Bridge Palos Heights is
subdivided in accordance with applicable law and in a manner acceptable
to the Administrative Agent in its reasonable discretion on or before
December 31, 1999. It is understood and agreed that the Parent will
make equity investments in certain of the Borrowers simultaneously with
such Borrowers becoming Borrowers hereunder in accordance with the
terms of Section 2.3. It is also understood and agreed that the Parent
will need to make equity investments in certain Persons prior to their
becoming a Borrower hereunder. Such investment shall be considered a
Permitted Investment so long as such Person becomes a Borrower
hereunder in accordance with the terms of Section 2.3 within 30 days of
the initial investment by the Parent in such Person.
"Permitted Liens" means:
(i) Liens in favor of the Administrative Agent for the
benefit of the Lenders to secure the Credit Party Obligations;
(ii) Liens (other than Liens created or imposed under ERISA)
for taxes, assessments or governmental charges or levies not yet due or
Liens for taxes being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with
GAAP have been established (and as to which the Property subject to any
such Lien is not yet subject to foreclosure, sale or loss on account
thereof);
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(iii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens
imposed by law or pursuant to customary reservations or retentions of
title arising in the ordinary course of business, provided that such
Liens secure only amounts not yet due and payable or, if due and
payable, are unfiled and no other action has been taken to enforce the
same or are being contested in good faith by appropriate proceedings
for which adequate reserves determined in accordance with GAAP have
been established (and as to which the Property subject to any such Lien
is not yet subject to foreclosure, sale or loss on account thereof);
(iv) Liens (other than Liens created or imposed under ERISA)
incurred or deposits made by any Operative Party in the ordinary course
of business in connection with workers' compensation, unemployment
insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, bids, leases, government
contracts, performance and return-of-money bonds and other similar
obligations (exclusive of obligations for the payment of borrowed
money);
(v) Liens in connection with attachments or judgments
(including judgment or appeal bonds) provided that the judgments
secured shall, within 30 days after the entry thereof, have been
discharged or execution thereof stayed pending appeal, or shall have
been discharged within 30 days after the expiration of any such stay;
(vi) easements, rights-of-way, restrictions (including present
and future zoning restrictions), minor defects or irregularities in
title and other similar charges or encumbrances not, in any material
respect, impairing the use of the encumbered Property for its intended
purposes;
(vii) Liens on Property of any Borrower securing purchase
money Indebtedness (including Capital Leases) of such Borrower to the
extent permitted under Section 8.1(c), provided that any such Lien
attaches to such Property concurrently with or within 90 days after the
acquisition thereof;
(viii) leases or subleases granted to others not interfering
in any material respect with the business of any Operative Party;
(ix) normal and customary rights of setoff upon deposits of
cash in favor of banks or other depository institutions; and
(x) rights reserved to or vested in any Governmental Authority
by law to control or regulate, or obligations under law to any
Governmental Authority with respect to the use of any Property or to
any right, power, franchise, license or permit.
"Person" means any individual, partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated) or any Governmental
Authority.
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"Plan" means any employee benefit plan (as defined in Section
3(3) of ERISA) which is covered by ERISA and with respect to which any
Operative Party or any of its Subsidiaries or any ERISA Affiliate is
(or, if such plan were terminated at such time, would under Section
4069 of ERISA be deemed to be) an "employer" within the meaning of
Section 3(5) of ERISA.
"Pledge Agreement" means the pledge agreement dated as of the
Closing Date executed in favor of the Administrative Agent by the
Parent, as amended, modified, restated or supplemented from time to
time.
"Pool A Borrowers" means a collective reference to each of the
Borrowers identified on Schedule 1.1(c) and such other Persons as may
become Pool A Borrowers hereunder in accordance with the provisions of
Section 2.3, and "Pool A Borrower" means any one of them.
"Pool A Collateral" means a collective reference to the
Collateral pledged to the Administrative Agent, for the benefit of the
Lenders, by the Pool A Borrowers pursuant to the Collateral Documents.
"Pool A Designated Borrower" means Clare Bridge of Tuscawilla
L.P., a Delaware limited partnership.
"Pool A Event of Default" shall have the meaning given to such
term in Section 9.1(b).
"Pool A Loans" means the Revolving Loans (or a portion of any
Revolving Loan bearing interest at the Adjusted Base Rate or the
Adjusted Eurodollar Rate) made to the Pool A Borrowers individually or
collectively, as appropriate.
"Pool A Obligations" means, without duplication, (i) all of
the obligations of the Pool A Borrowers to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement,
the Notes, the Collateral Documents or any of the other Credit
Documents (including, but not limited, to, any interest accruing after
the occurrence of a Bankruptcy Event with respect to any Pool A
Borrower, regardless of whether such interest is an allowed claim under
the Bankruptcy Code) and (ii) all liabilities and obligations, whenever
arising, owing from any Pool A Borrower to any Lender, or any Affiliate
of a Lender, arising under any Hedging Agreement.
"Pool A Properties" means a collective reference to those Real
Properties owned by the Pool A Borrowers, and "Pool A Property" means
any one of them.
"Pool A Security Agreement" means the Pool A Security
Agreement dated as of the Closing Date executed in favor of the
Administrative Agent by the Pool A Borrowers, as amended, modified,
restated or supplemented from time to time.
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"Pool B Borrowers" means a collective reference to such
Persons as may become Pool B Borrowers hereunder in accordance with the
provisions of Section 2.3, and "Pool B Borrower" means any of them.
"Pool B Collateral" means a collective reference to the
Collateral pledged to the Administrative Agent, for the benefit of the
Lenders, by the Pool B Borrowers pursuant to the Collateral Documents.
"Pool B Designated Borrower" means that certain Pool B
Borrower designated by the other Pool B Borrowers to deliver Notices of
Borrowing and/or Notices of Extension/Conversion on behalf of all Pool
B Borrowers.
"Pool B Event of Default" shall have the meaning given to such
term in Section 9.1(c).
"Pool B Loans" means the Revolving Loans (or a portion of any
Revolving Loan bearing interest at the Adjusted Base Rate or the
Adjusted Eurodollar Rate) made to the Pool B Borrowers individually or
collectively, as appropriate.
"Pool B Obligations" means, without duplication, (i) all of
the obligations of the Pool B Borrowers to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement,
the Notes, the Collateral Documents or any of the other Credit
Documents (including, but not limited, to, any interest accruing after
the occurrence of a Bankruptcy Event with respect to any Pool B
Borrower, regardless of whether such interest is an allowed claim under
the Bankruptcy Code) and (ii) all liabilities and obligations, whenever
arising, owing from any Pool B Borrower to any Lender, or any Affiliate
of a Lender, arising under any Hedging Agreement.
"Pool B Properties" means a collective reference to those Real
Properties owned by the Pool B Borrowers, and "Pool B Property" means
any one of them.
"Pool B Security Agreement" means the security agreement to be
executed by the Pool B Borrowers in favor of the Administrative Agent,
as amended, modified, restated or supplemented from time to time.
"Pool C Borrower" means a collective reference to such Persons
as may become Pool C Borrowers hereunder in accordance with the
provisions of Section 2.3, and "Pool C Borrower" means any one of them.
"Pool C Collateral" means a collective reference to the
Collateral pledged to the Administrative Agent, for the benefit of the
Lenders, by the Pool C Borrowers pursuant to the Collateral Documents.
"Pool C Designated Borrower" means that certain Pool C
Borrower designated by the other Pool C Borrowers to deliver Notices of
Borrowing and/or Notices of Extension/Conversion on behalf of all Pool
C Borrowers.
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"Pool C Event of Default" shall have the meaning given to such
term in Section 9.1(d).
"Pool C Loans" means the Revolving Loans (or a portion of any
Revolving Loan bearing interest at the Adjusted Base Rate or the
Adjusted Eurodollar Rate) made to the Pool C Borrowers, individually or
collectively, as appropriate.
"Pool C Obligations" means, without duplication, (i) all of
the obligations of the Pool C Borrowers to the Lenders and the
Administrative Agent, whenever arising, under this Credit Agreement,
the Notes, the Collateral Documents or any of the other Credit
Documents (including, but not limited, to, any interest accruing after
the occurrence of a Bankruptcy Event with respect to any Pool C
Borrower, regardless of whether such interest is an allowed claim under
the Bankruptcy Code) and (ii) all liabilities and obligations, whenever
arising, owing from any Pool C Borrower to any Lender, or any Affiliate
of a Lender, arising under any Hedging Agreement.
"Pool C Properties" means a collective reference to those Real
Properties owned by the Pool C Borrowers, and "Pool C Property" means
any one of them.
"Pool C Security Agreement" means the security agreement to be
executed by the Pool C Borrowers in favor of the Administrative Agent,
as amended, modified, restated or supplemented from time to time.
"Prime Rate" means the per annum rate of interest established
from time to time by Bank of America as its prime rate, which rate may
not necessarily be the lowest rate of interest charged by Bank of
America to its customers.
"Property" means any interest in any kind of property or
asset, whether real, personal or mixed, or tangible or intangible.
"Real Properties" means the collective reference to the
Existing Properties and the New Properties, and "Real Property" means
any one of them.
"Register" shall have the meaning given such term in Section
11.3(c).
"Regulation T, U, or X" means Regulation T, U or X,
respectively, of the Board of Governors of the Federal Reserve System
as from time to time in effect and any successor to all or a portion
thereof.
"Release" means any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping
or disposing into the environment (including the abandonment or
discarding of barrels, containers and other closed receptacles) of any
Materials of Environmental Concern.
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"Reportable Event" means any of the events set forth in
Section 4043(c) of ERISA, other than those events as to which the
notice requirement has been waived by regulation.
"Required Lenders" means, at any time, Lenders holding in the
aggregate more than 50% of (i) the Revolving Commitments (and
Participation Interests therein) or (ii) if the Revolving Commitments
have been terminated, the outstanding Loans and Participation
Interests, provided that the Revolving Commitments of and the
outstanding principal amount of Revolving Loans and Participation
Interests owing to a Defaulting Lender shall be excluded for purposes
hereof in making a determination of Required Lenders.
"Requirement of Law" means, as to any Person, the certificate
of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or
any of its material property is subject.
"Restricted Payment" means (i) any dividend or other payment
or distribution, direct or indirect, on account of any shares of any
class of Capital Stock of any Operative Party or any of its
Subsidiaries, now or hereafter outstanding (including without
limitation any payment in connection with any merger or consolidation
involving any Operative Party or any of its Subsidiaries), or to the
direct or indirect holders of any shares of any class of Capital Stock
now or hereafter outstanding of any Operative Party or any of its
Subsidiaries in their capacity as such holder (other than dividends or
distributions payable in the same class of Capital Stock of the
applicable Person or to any Operative Party (directly or indirectly
through Subsidiaries), (ii) any redemption, retirement, sinking fund or
similar payment, purchase or other acquisition for value, direct or
indirect, of any shares of any class of Capital Stock of any Operative
Party or any of its Subsidiaries, now or hereafter outstanding and
(iii) any payment made to retire, or to obtain the surrender of, any
outstanding warrants, options or other rights to acquire shares of any
class of Capital Stock of any Operative Party or any of its
Subsidiaries, now or hereafter outstanding.
"Revolving Commitment" means, with respect to each Lender, the
commitment of such Lender in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Commitment Percentage of
the Revolving Committed Amount to make Revolving Loans in accordance
with the provisions of Section 2.1(a).
"Revolving Commitment Percentage" means, for any Lender, the
percentage identified as its Revolving Commitment Percentage on
Schedule 2.1(a)(i), as such percentage may be modified in connection
with any assignment made in accordance with the provisions of Section
11.3.
"Revolving Committed Amount" means Two Hundred Million Dollars
($200,000,000) (as such aggregate maximum amount may be reduced from
time to time as provided in Section 3.4).
"Revolving Loans" shall have the meaning assigned to such term
in Section 2.1(a).
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"Revolving Note" or "Revolving Notes" means the promissory
notes of the Borrowers in favor of each of the Lenders evidencing the
Revolving Loans provided pursuant to Section 2.1(e), individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, restated, supplemented, extended, renewed or replaced from
time to time.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw Hill, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
"Sale and Leaseback Transaction" means any direct or indirect
arrangement with any Person or to which any such Person is a party,
providing for the leasing to any Operative Party or any of its
Subsidiaries of any Property, whether owned by such Operative Party or
any of its Subsidiaries as of the Closing Date or later acquired, which
has been or is to be sold or transferred by such Operative Party or any
of its Subsidiaries to such Person or to any other Person from whom
funds have been, or are to be, advanced by such Person on the security
of such Property.
"Security Agreements" means a collective reference to the Pool
A Security Agreement, the Pool B Security Agreement and the Pool C
Security Agreement.
"Senior Debt" shall have the meaning given such term in the
definition of Senior Debt Rating.
"Senior Debt Rating" means (i) the publicly announced rating
by S&P for the senior unsecured revolving bank debt of HCR and (ii) the
publicly announced rating by Moody's for the senior unsecured revolving
bank debt of HCR ("Senior Debt").
"Single Employer Plan" means any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan or a Multiple
Employer Plan.
"Solvent" or "Solvency" means, with respect to any Person as
of a particular date, that on such date (i) such Person is able to
realize upon its assets and pay its debts and other liabilities,
contingent obligations and other commitments as they mature in the
normal course of business, (ii) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay as such debts and liabilities mature in their
ordinary course, (iii) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction,
for which such Person's Property would constitute unreasonably small
capital after giving due consideration to the prevailing practice in
the industry in which such Person is engaged or is to engage, (iv) the
fair value of the Property of such Person is greater than the total
amount of liabilities, including, without limitation, contingent
liabilities, of such Person and (v) the present fair salable value of
the assets of such Person is not less than the amount that will be
required to pay the probable liability of such Person on its debts as
they become absolute and matured. In computing the amount of contingent
liabilities at any time, it is intended that such liabilities will be
computed at the amount which, in light of all the facts and
circumstances existing at such
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time, represents the amount that can reasonably be expected to become
an actual or matured liability.
"Stabilized Eligible Project" means an Eligible Project that
(i) has been in operation for at least five full fiscal quarters
following the date of the first resident occupancy of such Eligible
Project and (ii) has a Debt Service Coverage Ratio of at least 1.15 to
1.0.
"Subsidiary" means, as to any Person at any time, (a) any
corporation more than 50% of whose Capital Stock of any class or
classes having by the terms thereof ordinary voting power to elect a
majority of the directors of such corporation (irrespective of whether
or not at such time, any class or classes of such corporation shall
have or might have voting power by reason of the happening of any
contingency) is at such time owned by such Person directly or
indirectly through Subsidiaries, and (b) any partnership, association,
joint venture or other entity of which such Person directly or
indirectly through Subsidiaries owns at such time more than 50% of the
Capital Stock.
"Syndication Agent" shall have the meaning assigned to such
term in the heading hereof, together with any successors and assigns.
"Synthetic Lease" means any synthetic lease, tax retention
operating lease, off-balance sheet loan or similar off-balance sheet
financing product where such transaction is considered borrowed money
indebtedness for tax purposes but is classified as an Operating Lease
for purposes of GAAP.
"Taxes" shall have the meaning assigned to such term in
Section 3.11.
"Treasury Rate" means, for any day, a rate of interest equal
to the yield for actively traded U.S. Treasury securities having a ten
(10) year maturity as determined by the Administrative Agent prior to
9:00 a.m. Charlotte, North Carolina time.
"Title Insurance Company" shall have the meaning given to such
term in Section 5.1(e)(ii).
"Unused Fee" shall have the meaning assigned to such term in
Section 3.5(b).
"Unused Fee Calculation Period" shall have the meaning
assigned to such term in Section 3.5(b).
"Unused Revolving Committed Amount" means, for any period, the
amount by which (a) the then applicable Revolving Committed Amount
exceeds (b) the daily average sum for such period of the outstanding
aggregate principal amount of all Revolving Loans.
"Upfront Fee" shall have the meaning assigned to such term in
Section 3.5(a).
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"Voting Stock" means, with respect to any Person, Capital
Stock issued by such Person the holders of which are ordinarily, in the
absence of contingencies, entitled to vote for the election of
directors (or persons performing similar functions) of such Person,
even though the right so to vote has been suspended by the happening of
such a contingency.
"Wholly Owned Subsidiary" of any Person means any Subsidiary
100% of whose Voting Stock is at the time owned by such Person directly
or indirectly through other Wholly Owned Subsidiaries.
1.2 COMPUTATION OF TIME PERIODS.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
1.3 ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis. All calculations made for the purposes of determining compliance with
this Credit Agreement shall (except as otherwise expressly provided herein) be
made by application of GAAP applied on a basis consistent with the most recent
annual or quarterly financial statements delivered pursuant to Section 7.1 (or,
prior to the delivery of the first financial statements pursuant to Section 7.1,
consistent with the financial statements as at December 31, 1998); provided,
however, if (a) the Operative Parties shall object to determining such
compliance on such basis at the time of delivery of such financial statements
due to any change in GAAP or the rules promulgated with respect thereto or (b)
the Administrative Agent or the Required Lenders shall so object in writing
within 60 days after delivery of such financial statements, then such
calculations shall be made on a basis consistent with the most recent financial
statements delivered by the Operative Parties to the Lenders as to which no such
objection shall have been made.
SECTION 2
CREDIT FACILITIES
2.1 REVOLVING LOANS.
(a) Revolving Commitment. Subject to the terms and conditions
hereof and in reliance upon the representations and warranties set
forth herein, each Lender severally agrees to make available to the
Borrowers such Lender's Revolving Commitment Percentage of revolving
credit loans requested by the Borrowers in Dollars ("Revolving Loans")
from time to time from the Closing Date until the Maturity Date, or
such earlier date as the Revolving Commitments shall have been
terminated as provided herein; provided, however, that (i) with regard
to the Lenders collectively, the sum of the aggregate principal amount
of Revolving Loans outstanding shall not exceed the lesser of (x) the
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Revolving Committed Amount and (y) the Borrowing Base, (ii) with regard
to each Lender individually, the amount of such Lender's Revolving
Commitment Percentage of the sum of the Revolving Loans shall not
exceed such Lender's Revolving Committed Amount, (iii) the sum of the
aggregate principal amount of Revolving Loans outstanding with respect
to any Eligible Project shall not exceed such Eligible Project's
Eligible Project Loan Amount and (iv) a Revolving Loan borrowing shall
only be made available once per calendar month; provided, however (A)
the Borrowers may make additional Revolving Loan borrowings during a
calendar month so long as the Loan proceeds received by the Borrowers
from such Revolving Loan borrowings are used solely to make interest
payments in accordance with the terms hereof and (B) the Pool B
Borrowers may make two (2) additional Revolving Loan borrowings prior
to October 31, 1999 in order to refinance the Pool B Properties
identified on Schedule 2.1(a)(ii). Revolving Loans may consist of Base
Rate Loans or Eurodollar Loans, or a combination thereof, as the
Borrowers may request; provided, however, that no more than twelve
Eurodollar Loans (other than Eurodollar Loans outstanding which have
been used by the Borrowers solely to make interest payments required
hereunder) shall be outstanding hereunder at any time (it being
understood that, for purposes hereof, Eurodollar Loans with different
Interest Periods shall be considered as separate Eurodollar Loans, even
if they begin on the same date, although borrowings, extensions and
conversions may, in accordance with the provisions hereof, be combined
at the end of existing Interest Periods to constitute a new Eurodollar
Loan with a single Interest Period). Revolving Loans hereunder may be
repaid and reborrowed in accordance with the provisions hereof. Other
than any Revolving Loans used to refinance an Eligible Project already
open for business, no Revolving Loans shall be made available to any
Borrower with respect to any Eligible Project which has been in
operation for five full fiscal quarters following the date of the first
resident occupancy of such Eligible Project.
(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. A Designated Borrower shall
request a Revolving Loan borrowing by written notice (or
telephonic notice promptly confirmed in writing) to the
Administrative Agent not later than 11:00 A.M. (Charlotte,
North Carolina time) on the sixth Business Day prior to the
date of the requested borrowing in the case of Base Rate Loans
(other than the initial borrowing of Base Rate Loans on the
Closing Date which will require notice to be delivered on the
Closing Date), and on the eighth Business Day prior to the
date of the requested borrowing in the case of Eurodollar
Loans. Each such request for borrowing shall be irrevocable
and shall specify (A) that a Revolving Loan is requested, (B)
the date of the requested borrowing (which shall be a Business
Day), (C) the aggregate principal amount to be borrowed, (D) a
breakdown of (I) the amount of such Revolving Loan which each
applicable Borrower is actually borrowing and (II) the
Eligible Project for which each such portion of the Revolving
Loan is being used, and (E) whether the borrowing shall be
comprised of Base Rate Loans, Eurodollar Loans or a
combination thereof, and if Eurodollar Loans are requested,
the Interest Period(s) therefor. Each Notice of Borrowing
shall also be accompanied by (x) copies of invoices
substantiating the soft costs of the Borrowers and (y) a
schedule designating which Eligible Projects and which
expenditure categories with respect to
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such Eligible Projects such Revolving Loans will be used to
pay by the applicable Borrowers; provided, however, subject to
the terms of Section 8.15, a Revolving Loan advance may be
used by an applicable Borrower to make payment on a specific
expenditure category in an amount in excess of the amount
designated for such expenditure category in the applicable
Development Budget, so long as there has been a demonstrated
cost savings in one or more specific expenditure categories in
an amount equal to or greater than such excess payment. If a
Designated Borrower shall fail to specify in any such Notice
of Borrowing (I) an applicable Interest Period in the case of
a Eurodollar Loan, then such notice shall be deemed to be a
request for an Interest Period of one month, or (II) the type
of Revolving Loan requested, then such notice shall be deemed
to be a request for a Base Rate Loan hereunder. The
Administrative Agent shall give notice to each affected Lender
promptly upon receipt of each Notice of Borrowing pursuant to
this Section 2.1(b)(i), the contents thereof and each such
Lender's share of any borrowing to be made pursuant thereto.
(ii) Minimum Amounts. Each Base Rate Loan shall be in
a minimum aggregate principal amount of $500,000 and integral
multiples of $100,000 in excess thereof (or the remaining
amount of the Revolving Committed Amount, if less). Each
Eurodollar Loan shall be in a minimum aggregate principal of
$1,000,000 and integral multiples of $100,000 in excess
thereof (or the remaining amount of the Revolving Committed
Amount, if less).
(iii) Advances. Each Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing
available to the Administrative Agent for the account of a
Borrower as specified in Section 3.15(a), or in such other
manner as the Administrative Agent may specify in writing, by
11:00 A.M. (Charlotte, North Carolina time) on the date
specified in the applicable Notice of Borrowing in Dollars and
in funds immediately available to the Administrative Agent.
Such borrowing will then be made available to the Designated
Borrowers by the Administrative Agent on the date specified in
the applicable Notice of Borrowing by crediting the account of
the Designated Borrowers on the books of such office with the
aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the
Administrative Agent.
(iv) Development Fees. The Lenders will make Loan
advances to reimburse the appropriate Borrowers' development
fees owing to HCR and/or Alterra with respect to the Eligible
Projects; provided, however with respect to any development
fees owing to HCR and/or Alterra on Eligible Projects which
have not been fully constructed, Loan advances to reimburse
such development fees will be made in the following manner:
(A) From and after such time as site zoning and
permitting and site acquisition have occurred with
respect to an Eligible Project, the Borrower may use
Loan proceeds in an amount up to 5% of the applicable
projected all-in project costs as set forth in the
applicable Development
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Budget with respect to an Eligible Project to pay the
development fee with respect to an Eligible Project;
and
(B) From and after such time as a
certificate of occupancy has been issued for an
Eligible Project, the Borrower may use Loan proceeds
to pay development fees with respect to such Eligible
Project in an amount equal to the difference between
(I) 7% of the applicable projected all-in project
costs as set forth in the applicable Development
Budget with respect to an Eligible Project minus (II)
the amount of Loan proceeds used to pay the
development fees with respect to such Eligible
Project pursuant to subsection (iv)(A) above.
Provided, however, it is understood and agreed that
Loan advances used to pay development fees with
respect to an Eligible Project shall not exceed 7% of
the applicable projected all-in project costs on such
Eligible Project.
(c) Repayment. The principal amount of all Revolving
Loans shall be due and payable in full on the Maturity Date,
unless accelerated sooner pursuant to Section 9.2.
(d) Interest. Subject to the provisions of Section 3.1,
(i) Base Rate Loans. During such periods as Revolving
Loans shall be comprised in whole or in part of Base Rate
Loans, such Base Rate Loans shall bear interest at a per annum
rate equal to the Adjusted Base Rate.
(ii) Eurodollar Loans. During such periods as
Revolving Loans shall be comprised in whole or in part of
Eurodollar Loans, such Eurodollar Loans shall bear interest at
a per annum rate equal to the Adjusted Eurodollar Rate.
Interest on Revolving Loans shall be payable in arrears on each
applicable Interest Payment Date (or at such other times as may be
specified herein).
(e) Revolving Notes. The Revolving Loans made by each
Lender shall be evidenced by a duly executed promissory note of the
Borrowers to such Lender in an original principal amount equal to such
Lender's Revolving Commitment Percentage of the Revolving Committed
Amount and in substantially the form of Exhibit 2.1(e).
2.2 EXTENSION OF MATURITY DATE.
(a) First Extension. Not more than 15 months and not less
than 90 days prior to the date occurring three years from the Closing
Date, the Credit Parties may request in writing that the Lenders extend
the Maturity Date for an additional one year period (the "First
Extended Maturity Date"). The Maturity Date shall be extended for an
additional one year period if (i) each of the Lenders has approved such
extension in writing and (ii) the Borrowers shall have paid to each
Lender an extension fee in an amount equal to 0.15% of the Revolving
Commitment of each Lender.
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(b) Second Extension. If the Maturity Date has been
extended to the First Extended Maturity Date, not more than 12 months
and not less than 90 days prior to the First Extended Maturity Date,
the Credit Parties may request in writing that the Lenders extend the
Maturity Date for a second one year period. The Maturity Date shall be
extended for a second one year period (the "Second Extended Maturity
Date") if (i) each of the Lenders has approved such extension in
writing and (ii) the Borrowers shall have paid to each Lender an
extension fee in an amount equal to 0.15% of the Revolving Commitment
of each Lender.
2.3 ADDITIONAL BORROWERS.
The Parent may request designation of any Person (an "Applicant
Borrower") as a Borrower hereunder by delivery of such a request to the
Administrative Agent together with a Joinder Agreement executed by such
Applicant Borrower in substantially the form attached as Exhibit 2.3(i). Such
request shall include a designation of whether such Borrower will be a Pool A
Borrower, a Pool B Borrower or a Pool C Borrower. The Administrative Agent will
promptly notify the Lenders of any such request together with a copy of the
Joinder Agreement executed by the Applicant Borrower. The joinder of each
Applicant Borrower as a Borrower will be subject to (i) delivery of executed
Revolving Notes and supporting resolutions, articles or certificates of
incorporation or organization, as applicable, bylaws, operating agreement or
partnership agreement, incumbency certificates, opinions of counsel and such
other items as the Administrative Agent and the Required Lenders may reasonably
request, (ii) pledge by such Applicant Borrower of all of its assets to the
Administrative Agent, for the benefit of the Lenders, pursuant to a security
agreement in substantially the form of the Security Agreements and otherwise in
form and substance reasonably acceptable to the Administrative Agent, (iii) with
respect to the joinder of a Borrower, delivery of stock certificates, if any,
and pledge of 10% of the Capital Stock of such Borrower by the Parent pursuant
to a pledge supplement in substantially the form of Exhibit 2.3(ii), (iv)
acknowledgment and consent of each of the Guarantors to the joinder of such
Applicant Borrower, together with the agreement of such Guarantors that such
joinder does not operate to reduce or discharge the Guarantors' obligations
under the Credit Documents, (v) delivery to the Administrative Agent of all
items identified in Section 5.3 with respect to the Facility of such Applicant
Borrower (in form, content and scope satisfactory to the Administrative Agent)
and all other items necessary to qualify the Facility of such Borrower as an
Eligible Project, (vi) delivery by an officer of the Parent, in its capacity as
general partner of such Applicant Borrower, of an officer's certificate in
substantially the form of the officer's certificate described in Section
5.1(n)(a) hereof and (vii) such other documentation as the Administrative Agent
may reasonably request in connection with the foregoing, including, without
limitation, searches of Uniform Commercial Code filings and appropriate UCC-1
financing statements, all in form, content and scope reasonably satisfactory to
the Administrative Agent. Any such addition of an Applicant Borrower shall be
effective upon receipt by the Administrative Agent of the items required by the
terms of this Section 2.3 and the items with respect to the Facility of such
Applicant Borrower required by Section 5.3. Such Applicant Borrower shall
thereupon become a party hereto and a Borrower hereunder and shall be (i)
entitled to all rights and benefits of a Borrower hereunder and under each
instrument executed pursuant hereto and (ii) subject to all obligations of a
Borrower hereunder and thereunder.
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2.4 JOINT AND SEVERAL LIABILITY AMONG POOL BORROWERS.
(a) Pool A Borrowers.
(i) Each of the Pool A Borrowers is accepting joint
and several liability hereunder for the Pool A Obligations in
consideration of the financial accommodation to be provided by
the Lenders under this Credit Agreement, for the mutual
benefit, directly and indirectly, of each of the Pool A
Borrowers and in consideration of the undertakings of each of
the Pool A Borrowers to accept joint and several liability for
the obligations of each of them.
(ii) Each of the Pool A Borrowers jointly and
severally hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several
liability with the other Pool A Borrowers with respect to the
payment and performance of all of the Pool A Obligations
arising under this Credit Agreement and the other Credit
Documents, it being the intention of the parties hereto that
all the Pool A Obligations shall be the joint and several
obligations of each of the Pool A Borrowers without
preferences or distinction among them.
(iii) If and to the extent that any of the Pool A
Borrowers shall fail to make any payment with respect to any
of the Pool A Obligations hereunder as and when due or to
perform any of such obligations in accordance with the terms
thereof (including, without limitation, any applicable cure
periods), then in each such event, the other Pool A Borrowers
will make such payment with respect to, or perform, such
obligation.
(iv) The obligations of each Pool A Borrower under
the provisions of this Section 2.4(a) constitute full recourse
obligations of such Pool A Borrower, enforceable against it to
the full extent of its properties and assets, irrespective of
the validity, regularity or enforceability of this Credit
Agreement or any other circumstances whatsoever.
(v) Except as otherwise expressly provided herein,
each Pool A Borrower hereby waives notice of acceptance of its
joint and several liability, notice (except to the extent
notice is expressly required to be given pursuant to the terms
of this Credit Agreement) of occurrence of any Default or
Event of Default, or of any demand for any payment under this
Credit Agreement, notice of any action at any time taken or
omitted by the Lender under or in respect of any of the Pool A
Obligations hereunder, any requirement of diligence and,
generally, all demands, notices and other formalities of every
kind in connection with this Credit Agreement. With respect to
its obligations under this Section 2.4(a), each Pool A
Borrower hereby assents to, and waives notice of, any
extension or postponement of the time for the payment of any
of the Pool A Obligations hereunder, the acceptance of any
partial payment thereon, any waiver, consent or other action
or acquiescence by the Lenders at any time or times in respect
of any
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default by any other Pool A Borrower in the performance or
satisfaction of any term, covenant, condition or provision of
this Credit Agreement, any and all other indulgences
whatsoever by the Lenders in respect of any of the Pool A
Obligations hereunder, and the taking, addition, substitution
or release, in whole or in part, at any time or times, of any
security for any of such Pool A Obligations or the addition,
substitution or release, in whole or in part, of any Pool A
Borrower. Without limiting the generality of the foregoing,
each Pool A Borrower assents to any other action or delay in
acting or any failure to act on the part of the Lender,
including, without limitation, any failure strictly or
diligently to assert any right or to pursue any remedy or to
comply fully with applicable laws or regulations thereunder
which might, but for the provisions of this Section 2.4(a),
afford grounds for terminating, discharging or relieving such
Pool A Borrower, in whole or in part, from any of its
obligations under this Section 2.4(a), it being the intention
of each Pool A Borrower that, so long as any of the Pool A
Obligations hereunder remain unsatisfied, the obligations of
such Pool A Borrower under this Section 2.4(a) shall not be
discharged except by performance and then only to the extent
of such performance. The obligations of each Pool A Borrower
under this Section 2.4(a) shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect
to any reconstruction or similar proceeding with respect to
any Pool A Borrower or any Lender. The joint and several
liability of the Pool A Borrowers hereunder shall continue in
full force and effect notwithstanding any absorption, merger,
amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Pool A
Borrower or any Lender.
(vi) The provisions of this Section 2.4(a) are made
for the benefit of the Administrative Agent and the Lenders
and their respective successors and assigns, and may be
enforced by any such Person from time to time against any of
the Pool A Borrowers as often as occasion therefor may arise
and without requirement on the part of any Lender first to
marshal any of its claims or to exercise any of its rights
against any of the other Pool A Borrowers or to exhaust any
remedies available to it against any of the other Pool A
Borrowers or to resort to any other source or means of
obtaining payment of any of the Pool A Obligations or to elect
any other remedy. The provisions of this Section 2.4(a) shall
remain in effect until all the Pool A Obligations hereunder
shall have been paid in full or otherwise fully satisfied. If
at any time, any payment, or any part thereof, made in respect
of any of the Pool A Obligations, is rescinded or must
otherwise be restored or returned by the Lenders upon the
insolvency, bankruptcy or reorganization of any of the Pool A
Borrowers, or otherwise, the provisions of this Section 2.4(a)
will forthwith be reinstated and in effect as though such
payment had not been made.
(vii) Notwithstanding any provision to the contrary
contained herein or in any other of the Credit Documents or
Hedging Agreements of the Pool A Borrowers, the obligations of
each Pool A Borrower hereunder shall be limited to
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an aggregate amount equal to the largest amount that would not
render its obligations hereunder subject to avoidance under
Section 548 of the Bankruptcy Code or any comparable
provisions of any applicable state law.
(viii) Notwithstanding anything to the contrary
contained in any Credit Document, each of the parties hereto
agrees that the Pool A Borrowers shall not have any liability
for the Pool B Obligations and Pool C Obligations.
(b) Pool B Borrowers.
(i) Each of the Pool B Borrowers is accepting joint
and several liability hereunder for the Pool B Obligations in
consideration of the financial accommodation to be provided by
the Lenders under this Credit Agreement, for the mutual
benefit, directly and indirectly, of each of the Pool B
Borrowers and in consideration of the undertakings of each of
the Pool B Borrowers to accept joint and several liability for
the obligations of each of them.
(ii) Each of the Pool B Borrowers jointly and
severally hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several
liability with the other Pool B Borrowers with respect to the
payment and performance of all of the Pool B Obligations
arising under this Credit Agreement and the other Credit
Documents, it being the intention of the parties hereto that
all the Pool B Obligations shall be the joint and several
obligations of each of the Pool B Borrowers without
preferences or distinction among them.
(iii) If and to the extent that any of the Pool B
Borrowers shall fail to make any payment with respect to any
of the Pool B Obligations hereunder as and when due or to
perform any of such obligations in accordance with the terms
thereof (including, without limitation, any applicable cure
periods), then in each such event, the other Pool B Borrowers
will make such payment with respect to, or perform, such
obligation.
(iv) The obligations of each Pool B Borrower under
the provisions of this Section 2.4(b) constitute full recourse
obligations of such Pool B Borrower, enforceable against it to
the full extent of its properties and assets, irrespective of
the validity, regularity or enforceability of this Credit
Agreement or any other circumstances whatsoever.
(v) Except as otherwise expressly provided herein,
each Pool B Borrower hereby waives notice of acceptance of its
joint and several liability, notice (except to the extent
notice is expressly required to be given pursuant to the terms
of this Credit Agreement) of occurrence of any Default or
Event of Default, or of any demand for any payment under this
Credit Agreement, notice of any action at any time taken or
omitted by the Lender under or in respect of any of the Pool B
Obligations hereunder, any requirement of diligence and,
generally, all
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demands, notices and other formalities of every kind in
connection with this Credit Agreement. Each Pool B Borrower
hereby assents to, and waives notice of, any extension or
postponement of the time for the payment of any of the Pool B
Obligations hereunder, the acceptance of any partial payment
thereon, any waiver, consent or other action or acquiescence
by the Lenders at any time or times in respect of any default
by any other Pool B Borrower in the performance or
satisfaction of any term, covenant, condition or provision of
this Credit Agreement, any and all other indulgences
whatsoever by the Lenders in respect of any of the Pool B
Obligations hereunder, and the taking, addition, substitution
or release, in whole or in part, at any time or times, of any
security for any of such Pool B Obligations or the addition,
substitution or release, in whole or in part, of any Pool B
Borrower. Without limiting the generality of the foregoing,
each Pool B Borrower assents to any other action or delay in
acting or any failure to act on the part of the Lender,
including, without limitation, any failure strictly or
diligently to assert any right or to pursue any remedy or to
comply fully with applicable laws or regulations thereunder
which might, but for the provisions of this Section 2.4(b),
afford grounds for terminating, discharging or relieving such
Pool B Borrower, in whole or in part, from any of its
obligations under this Section 2.4(b), it being the intention
of each Pool B Borrower that, so long as any of the Pool B
Obligations hereunder remain unsatisfied, the obligations of
such Pool B Borrower under this Section 2.4(b) shall not be
discharged except by performance and then only to the extent
of such performance. The obligations of each Pool B Borrower
under this Section 2.4(b) shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect
to any reconstruction or similar proceeding with respect to
any Pool B Borrower or any Lender. The joint and several
liability of the Pool B Borrowers hereunder shall continue in
full force and effect notwithstanding any absorption, merger,
amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Pool B
Borrower or any Lender.
(vi) The provisions of this Section 2.4(b) are made
for the benefit of the Administrative Agent and the Lenders
and their respective successors and assigns, and may be
enforced by any such Person from time to time against any of
the Pool B Borrowers as often as occasion therefor may arise
and without requirement on the part of any Lender first to
marshal any of its claims or to exercise any of its rights
against any of the other Pool B Borrowers or to exhaust any
remedies available to it against any of the other Pool B
Borrowers or to resort to any other source or means of
obtaining payment of any of the Pool B Obligations or to elect
any other remedy. The provisions of this Section 2.4(b) shall
remain in effect until all the Pool B Obligations hereunder
shall have been paid in full or otherwise fully satisfied. If
at any time, any payment, or any part thereof, made in respect
of any of the Pool B Obligations, is rescinded or must
otherwise be restored or returned by the Lenders upon the
insolvency, bankruptcy or reorganization of any of the Pool B
Borrowers, or otherwise, the provisions of
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this Section 2.4(b) will forthwith be reinstated and in effect
as though such payment had not been made.
(vii) Notwithstanding any provision to the contrary
contained herein or in any other of the Credit Documents or
Hedging Agreements of the Pool B Borrowers, the obligations of
each Pool B Borrower hereunder shall be limited to an
aggregate amount equal to the largest amount that would not
render its obligations hereunder subject to avoidance under
Section 548 of the Bankruptcy Code or any comparable
provisions of any applicable state law.
(viii) Notwithstanding anything to the contrary
contained in any Credit Document, each of the parties hereto
agrees that the Pool B Borrowers shall not have any liability
for the Pool A Obligations and Pool C Obligations.
(c) Pool C Borrowers.
(i) Each of the Pool C Borrowers is accepting joint
and several liability hereunder for the Pool C Obligations in
consideration of the financial accommodation to be provided by
the Lenders under this Credit Agreement, for the mutual
benefit, directly and indirectly, of each of the Pool C
Borrowers and in consideration of the undertakings of each of
the Pool C Borrowers to accept joint and several liability for
the obligations of each of them.
(ii) Each of the Pool C Borrowers jointly and
severally hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several
liability with the other Pool C Borrowers with respect to the
payment and performance of all of the Pool C Obligations
arising under this Credit Agreement and the other Credit
Documents, it being the intention of the parties hereto that
all the Pool C Obligations shall be the joint and several
obligations of each of the Pool C Borrowers without
preferences or distinction among them.
(iii) If and to the extent that any of the Pool C
Borrowers shall fail to make any payment with respect to any
of the Pool C Obligations hereunder as and when due or to
perform any of such obligations in accordance with the terms
thereof (including, without limitation, any applicable cure
periods), then in each such event, the other Pool C Borrowers
will make such payment with respect to, or perform, such
obligation.
(iv) The obligations of each Borrower under the
provisions of this Section 2.4(c) constitute full recourse
obligations of such Pool C Borrower, enforceable against it to
the full extent of its properties and assets, irrespective of
the validity, regularity or enforceability of this Credit
Agreement or any other circumstances whatsoever.
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(v) Except as otherwise expressly provided herein,
each Pool C Borrower hereby waives notice of acceptance of its
joint and several liability, notice (except to the extent
notice is expressly required to be given pursuant to the terms
of this Credit Agreement) of occurrence of any Default or
Event of Default, or of any demand for any payment under this
Credit Agreement, notice of any action at any time taken or
omitted by the Lender under or in respect of any of the Pool C
Obligations hereunder, any requirement of diligence and,
generally, all demands, notices and other formalities of every
kind in connection with this Credit Agreement. Each Pool C
Borrower hereby assents to, and waives notice of, any
extension or postponement of the time for the payment of any
of the Pool C Obligations hereunder, the acceptance of any
partial payment thereon, any waiver, consent or other action
or acquiescence by the Lenders at any time or times in respect
of any default by any other Pool C Borrower in the performance
or satisfaction of any term, covenant, condition or provision
of this Credit Agreement, any and all other indulgences
whatsoever by the Lenders in respect of any of the Pool C
Obligations hereunder, and the taking, addition, substitution
or release, in whole or in part, at any time or times, of any
security for any of such Pool C Obligations or the addition,
substitution or release, in whole or in part, of any Pool C
Borrower. Without limiting the generality of the foregoing,
each Pool C Borrower assents to any other action or delay in
acting or any failure to act on the part of the Lender,
including, without limitation, any failure strictly or
diligently to assert any right or to pursue any remedy or to
comply fully with applicable laws or regulations thereunder
which might, but for the provisions of this Section 2.4(c),
afford grounds for terminating, discharging or relieving such
Pool C Borrower, in whole or in part, from any of its
obligations under this Section 2.4(c), it being the intention
of each Pool C Borrower that, so long as any of the Pool C
Obligations hereunder remain unsatisfied, the obligations of
such Pool C Borrower under this Section 2.4(c) shall not be
discharged except by performance and then only to the extent
of such performance. The obligations of each Pool C Borrower
under this Section 2.4(c) shall not be diminished or rendered
unenforceable by any winding up, reorganization, arrangement,
liquidation, reconstruction or similar proceeding with respect
to any reconstruction or similar proceeding with respect to
any Pool C Borrower or any Lender. The joint and several
liability of the Pool C Borrowers hereunder shall continue in
full force and effect notwithstanding any absorption, merger,
amalgamation or any other change whatsoever in the name,
membership, constitution or place of formation of any Pool C
Borrower or any Lender.
(vi) The provisions of this Section 2.4(c) are made
for the benefit of the Administrative Agent and the Lenders
and their respective successors and assigns, and may be
enforced by any such Person from time to time against any of
the Pool C Borrowers as often as occasion therefor may arise
and without requirement on the part of any Lender first to
marshal any of its claims or to exercise any of its rights
against any of the other Pool C Borrowers or to exhaust any
remedies available to it against any of the other Pool C
Borrowers or to resort to any other source or means of
obtaining payment of any of the Pool C
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Obligations or to elect any other remedy. The provisions of
this Section 2.4(c) shall remain in effect until all the Pool
C Obligations hereunder shall have been paid in full or
otherwise fully satisfied. If at any time, any payment, or any
part thereof, made in respect of any of the Pool C
Obligations, is rescinded or must otherwise be restored or
returned by the Lenders upon the insolvency, bankruptcy or
reorganization of any of the Pool C Borrowers, or otherwise,
the provisions of this Section 2.4(c) will forthwith be
reinstated and in effect as though such payment had not been
made.
(vii) Notwithstanding any provision to the contrary
contained herein or in any other of the Credit Documents or
Hedging Agreements of the Pool C Borrowers, the obligations of
each Pool C Borrower hereunder shall be limited to an
aggregate amount equal to the largest amount that would not
render its obligations hereunder subject to avoidance under
Section 548 of the Bankruptcy Code or any comparable
provisions of any applicable state law.
(viii) Notwithstanding anything to the contrary
contained in any Credit Document, each of the parties hereto
agrees that the Pool C Borrowers shall not have any liability
for the Pool A Obligations and Pool B Obligations.
2.5 REMOVAL OF A BORROWER.
If (a) a Borrower sells or refinances an Eligible Project in accordance
with the terms of Section 8.5 and such Borrower no longer owns any other
Eligible Projects or (b) the Capital Stock of a Borrower is sold by the Parent
and the other shareholders thereof in accordance with Section 8.5, such Borrower
may request to cease to be a Borrower by delivering to the Administrative Agent
a written notice to such effect. Such Borrower shall cease to be a Borrower
hereunder on the later to occur of (i) the date the Administrative Agent
receives such request and (ii) the date such Borrower has paid all of its
Revolving Loans and all accrued and unpaid interest, fees and other obligations
hereunder or in connection herewith. Upon the occurrence of the events
referenced in the preceding sentence, the Administrative Agent shall deliver to
the applicable Borrower (and the Lenders hereby authorize the Administrative
Agent to) upon such Borrower's request and at such Borrower's expense, such
documentation as is reasonably necessary to evidence the release of the
Administrative Agent's security interest in such Borrower's assets.
2.6 APPOINTMENT OF DESIGNATED BORROWER AS AGENT FOR BORROWERS.
(a) Pool A Appointment. Each of the Pool A Borrowers hereby
appoints the Pool A Designated Borrower to act as its exclusive agent
for all matters related to the borrowing of Revolving Loans as
described in Section 2 hereof). Each of the Pool A Borrowers
acknowledges and agrees that (a) the Pool A Designated Borrower may
execute a Notice of Borrowing and/or a Notice of Extension/Conversion
on behalf of any or all of the Pool A Borrowers, and each such Pool A
Borrower shall be bound by and obligated by all of the terms of such
Notice of Borrowing and/or
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Notice of Extension/Conversion executed by the Pool A Designated
Borrower on its behalf and (b) the Administrative Agent and each of the
Lenders shall accept (and shall be permitted to rely on) any Notice of
Borrowing and/or Notice of Extension/Conversion executed by the Pool A
Designated Borrower on behalf of the Pool A Borrowers (or any of them).
(b) Pool B Appointment. Each of the Pool B Borrowers hereby
appoints the Pool B Designated Borrower to act as its exclusive agent
for all matters related to the borrowing of Revolving Loans as
described in Section 2 hereof). Each of the Pool B Borrowers
acknowledges and agrees that (a) the Pool B Designated Borrower may
execute a Notice of Borrowing and/or a Notice of Extension/Conversion
on behalf of any or all of the Pool B Borrowers, and each such Pool B
Borrower shall be bound by and obligated by all of the terms of such
Notice of Borrowing and/or Notice of Extension/Conversion executed by
the Pool B Designated Borrower on its behalf and (b) the Administrative
Agent and each of the Lenders shall accept (and shall be permitted to
rely on) any Notice of Borrowing and/or Notice of Extension/Conversion
executed by the Pool B Designated Borrower on behalf of the Pool B
Borrowers (or any of them).
(c) Pool C Appointment. Each of the Pool C Borrowers hereby
appoints the Pool C Designated Borrower to act as its exclusive agent
for all matters related to the borrowing of Revolving Loans as
described in Section 2 hereof). Each of the Pool C Borrowers
acknowledges and agrees that (a) the Pool C Designated Borrower may
execute a Notice of Borrowing and/or Notice of Extension/Conversion on
behalf of any or all of the Pool C Borrowers, and each such Pool C
Borrower shall be bound by and obligated by all of the terms of such
Notice of Borrowing and/or Notice of Extension/Conversion executed by
the Pool C Designated Borrower on its behalf and (b) the Administrative
Agent and each of the Lenders shall accept (and shall be permitted to
rely on) any Notice of Borrowing and/or Notice of Extension/Conversion
executed by the Pool C Designated Borrower on behalf of the Pool C
Borrowers (or any of them).
SECTION 3
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1 DEFAULT RATE.
Upon the occurrence, and during the continuance, of an Event of
Default, the principal of and, to the extent permitted by law, interest on the
Loans and any other amounts owing hereunder or under the other Credit Documents
shall bear interest, payable on demand, at a per annum rate 2% greater than the
rate which would otherwise be applicable (or if no rate is applicable, whether
in respect of interest, fees or other amounts, then the Adjusted Base Rate plus
2%).
3.2 EXTENSION AND CONVERSION.
The Designated Borrowers shall have the option, on any Business Day, to
extend existing Loans into a subsequent permissible Interest Period or to
convert Loans into Loans of another interest rate type; provided, however, that
(i) except as provided in Section 3.8, Eurodollar Loans may be converted into
Base Rate Loans or extended as Eurodollar Loans for new Interest Periods
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only on the last day of the Interest Period applicable thereto, (ii) Eurodollar
Loans may be extended, and Base Rate Loans may be converted into Eurodollar
Loans, only if the conditions precedent set forth in Section 5.2 are satisfied
on the date of extension or conversion, (iii) Loans extended as, or converted
into, Eurodollar Loans shall be subject to the terms of the definition of
"Interest Period" set forth in Section 1.1 and shall be in such minimum amounts
as provided in Section 2.1(b)(ii), (iv) no more than twelve Eurodollar Loans
(other than Eurodollar Loans outstanding which were used by the Borrowers solely
to make interest payments in accordance with the terms hereof) shall be
outstanding hereunder at any time (it being understood that, for purposes
hereof, Eurodollar Loans with different Interest Periods shall be considered as
separate Eurodollar Loans, even if they begin on the same date, although
borrowings, extensions and conversions may, in accordance with the provisions
hereof, be combined at the end of existing Interest Periods to constitute a new
Eurodollar Loan with a single Interest Period) and (v) any request for extension
or conversion of a Eurodollar Loan which shall fail to specify an Interest
Period shall be deemed to be a request for an Interest Period of one month. Each
such extension or conversion shall be effected by a Designated Borrower by
giving a Notice of Extension/Conversion (or telephonic notice promptly confirmed
in writing) to the office of the Administrative Agent specified in specified in
Schedule 2.1(a)(i), or at such other office as the Administrative Agent may
designate in writing, prior to 11:00 A.M. (Charlotte, North Carolina time) on
the Business Day of, in the case of the conversion of a Eurodollar Loan into a
Base Rate Loan, and on the third Business Day prior to, in the case of the
extension of a Eurodollar Loan as, or conversion of a Base Rate Loan into, a
Eurodollar Loan, the date of the proposed extension or conversion, specifying
the date of the proposed extension or conversion, the Loans to be so extended or
converted, the types of Loans into which such Loans are to be converted and, if
appropriate, the applicable Interest Periods with respect thereto. Each request
for extension or conversion shall be irrevocable and shall constitute a
representation and warranty by the applicable Borrowers of the matters specified
in subsections (b), (c), (d), (e), (f) and (g) of Section 5.2(i), (ii) or (iii),
as applicable. In the event a Designated Borrower fails to request extension or
conversion of any Eurodollar Loan in accordance with this Section, or any such
conversion or extension is not permitted or required by this Section, then such
Eurodollar Loan shall be automatically converted into a Base Rate Loan at the
end of the Interest Period applicable thereto. The Administrative Agent shall
give each Lender notice as promptly as practicable of any such proposed
extension or conversion affecting any Loan.
3.3 PREPAYMENTS.
(a) Voluntary Prepayments. The Borrowers shall have the right
to prepay Loans in whole or in part from time to time; provided,
however, that each partial prepayment of Loans shall be in a minimum
principal amount of $1,000,000 and integral multiples of $100,000.
Subject to the foregoing terms, amounts prepaid under this Section
3.3(a) shall be applied as the Borrowers may elect; provided that if
the Borrowers fail to specify a voluntary prepayment then such
prepayment shall be applied to Revolving Loans, in each case first to
Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities. All prepayments under this Section 3.3(a)
shall be subject to Section 3.12, but otherwise without premium or
penalty.
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(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any time, the
sum of the aggregate principal amount of Revolving Loans
outstanding shall exceed the lesser of (x) the Revolving
Committed Amount and (y) the Borrowing Base, the Borrowers
shall immediately make payment on the Loans in an amount
sufficient to eliminate the deficiency.
(ii) Disposition or Refinancing of Eligible
Project/Disposition of Capital Stock.
(A) Immediately upon the disposition or refinancing
of a Facility, such Borrower shall prepay the Revolving Loans
in an aggregate amount equal to the amount of the Revolving
Loans of such Borrower borrowed hereunder with respect to such
Facility (such prepayment to be applied as set forth in clause
(iii) below).
(B) Immediately upon the disposition of the Capital
Stock of a Borrower in accordance with Section 8.5, such
Borrower shall prepay the Revolving Loans in an aggregate
amount equal to the amount of the Revolving Loans of such
Borrower borrowed hereunder (such prepayment to be applied as
set forth in clause (iii) below).
(C) If a Facility which has been constructed by a
Borrower using proceeds of the Revolving Loans is not fully
constructed and open for business within fifteen months of the
commencement of construction of such Facility, such Borrower
shall immediately prepay the Revolving Loans in an aggregate
amount equal to the amount of Revolving Loans borrowed
hereunder with respect to such Facility (such prepayment to be
applied as set forth in clause (iii) below.
(iii) Application of Mandatory Prepayments. All
amounts required to be paid pursuant to Section 3.3(b)(i) and
(ii) shall be applied to Revolving Loans. Within the
parameters of the applications set forth above, prepayments
shall be applied first to Base Rate Loans and then to
Eurodollar Loans in direct order of Interest Period
maturities. All prepayments under this Section 3.3(b) shall be
subject to Section 3.12.
3.4 TERMINATION AND REDUCTION OF REVOLVING COMMITTED AMOUNT.
Revolving Commitment. The Borrowers may from time to time
permanently reduce or terminate the Revolving Committed Amount in whole
or in part (in minimum aggregate amounts of $5,000,000 or in integral
multiples of $5,000,000 in excess thereof (or, if less, the full
remaining amount of the then applicable Revolving Committed Amount))
upon five Business Days' prior written notice to the Administrative
Agent; provided, that, no such termination or reduction shall be made
which would cause the sum of the aggregate outstanding principal amount
of the Revolving Loans to exceed the Revolving Committed Amount,
unless, concurrently with such termination or reduction, the
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Loans are repaid to the extent necessary to eliminate such excess. The
Administrative Agent shall promptly notify each affected Lender of
receipt by the Administrative Agent of any notice from the Borrowers
pursuant to this Section 3.4.
3.5 FEES.
(a) Upfront Fees. The Borrowers agree to pay to the
Administrative Agent for the benefit of the Lenders in immediately
available funds on or before the Closing Date an upfront fee (the
"Upfront Fee") in the amount provided in the Administrative Agent's Fee
Letter.
(b) Unused Fee. In consideration of the Revolving Commitments
of the Lenders hereunder, the Borrowers agree to pay to the
Administrative Agent for the account of each Lender a fee (the "Unused
Fee") on the Unused Revolving Committed Amount computed at a per annum
rate for each day during the applicable Unused Fee Calculation Period
(hereinafter defined) equal to the Applicable Percentage for Unused Fee
in effect from time to time. The Unused Fee shall commence to accrue on
the Closing Date and shall be due and payable in arrears on the last
business day of each March, June, September and December (and any date
that the Revolving Committed Amount is reduced as provided in Section
3.4 and the Maturity Date) for the immediately preceding quarter (or
portion thereof) (each such quarter or portion thereof for which the
Unused Fee is payable hereunder being herein referred to as an "Unused
Fee Calculation Period"), beginning with the first of such dates to
occur after the Closing Date.
(c) Administrative Fees. The Borrowers agree to pay to the
Administrative Agent, for its own account and Banc of America
Securities LLC, as applicable, the fees referred to in the
Administrative Agent's Fee Letter (collectively, the "Administrative
Agent's Fees").
3.6 CAPITAL ADEQUACY.
If any Lender has determined, after the date hereof, that the adoption
or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender's capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's policies with respect to capital adequacy), then,
upon notice from such Lender to the Borrowers (which notice shall set forth such
change regarding capital adequacy and the calculation of such reduced rate of
return as a result thereof), the Borrowers shall be obligated to pay to such
Lender such additional amount or amounts as will compensate such Lender for such
reduction; provided, however, that no such amounts shall be payable with respect
to a reduction in rate of return incurred more than 180 days before such Lender
demands compensation under this Section 3.6. Each
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determination by any such Lender of amounts owing under this Section shall,
absent manifest or demonstrable error, be conclusive and binding on the parties
hereto. The Lenders agree that in the exercise of rights under this Section 3.6,
they will accord the Borrowers the treatment generally accorded by the Lenders
to similarly situated borrowers.
3.7 LIMITATION ON EURODOLLAR LOANS.
If on or prior to the first day of any Interest Period for any
Eurodollar Loan:
(a) the Administrative Agent determines (which determination
shall be conclusive) that by reason of circumstances affecting the
relevant market, adequate and reasonable means do not exist for
ascertaining the Eurodollar Rate for such Interest Period; or
(b) the Required Lenders determine (which determination shall
be conclusive) and notify the Administrative Agent that the Eurodollar
Rate will not adequately and fairly reflect the cost to the Lenders of
funding Eurodollar Loans for such Interest Period;
then the Administrative Agent shall give the Borrowers prompt notice thereof,
and so long as such condition remains in effect, the Lenders shall be under no
obligation to make additional Eurodollar Loans, continue Eurodollar Loans, or to
convert Base Rate Loans into Eurodollar Loans and the Borrowers shall, on the
last day(s) of the then current Interest Period(s) for the outstanding
Eurodollar Loans, either prepay such Eurodollar Loans or convert such Eurodollar
Loans into Base Rate Loans in accordance with the terms of this Credit
Agreement.
3.8 ILLEGALITY.
Notwithstanding any other provision herein, if the adoption of or any
change in any Requirement of Law or in the interpretation or application thereof
occurring after the Closing Date shall make it unlawful for any Lender to make
or maintain Eurodollar Loans as contemplated by this Credit Agreement, (a) such
Lender shall promptly give written notice of such circumstances to the Borrowers
and the Administrative Agent (which notice shall be withdrawn whenever such
circumstances no longer exist), (b) the commitment of such Lender hereunder to
make Eurodollar Loans, continue Eurodollar Loans as such and convert a Base Rate
Loan to Eurodollar Loans, shall forthwith be canceled and, until such time as it
shall no longer be unlawful for such Lender to make or maintain Eurodollar
Loans, such Lender shall then have a commitment only to make a Base Rate Loan
when a Eurodollar Loan is requested and (c) on receipt of such notice by the
Administrative Agent and the Borrowers, such Lender's Loans then outstanding as
Eurodollar Loans, if any, shall be converted automatically to Base Rate Loans on
the respective last days of the then current Interest Periods with respect to
such Loans or within such earlier period as required by law. If any such
conversion of a Eurodollar Loan occurs on a day which is not the last day of the
then current Interest Period with respect thereto, the Borrowers shall pay to
such Lender such amounts, if any, as may be required pursuant to Section 3.12.
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3.9 REQUIREMENTS OF LAW.
If, after the date hereof, the adoption of any applicable law, rule, or
regulation, or any change in any applicable law, rule, or regulation, or any
change in the interpretation or administration thereof by any Governmental
Authority, central bank, or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its Applicable Lending
Office) with any request or directive (whether or not having the force of law)
of any such Governmental Authority, central bank, or comparable agency:
(i) shall subject such Lender (or its Applicable Lending
Office) to any tax, duty, or other charge with respect to any
Eurodollar Loans, its Notes, or its obligation to make Eurodollar
Loans, or change the basis of taxation of any amounts payable to such
Lender (or its Applicable Lending Office) under this Credit Agreement
or its Notes in respect of any Eurodollar Loans (other than taxes
imposed on the overall net income of such Lender by the jurisdiction in
which such Lender has its principal office or such Applicable Lending
Office);
(ii) shall impose, modify, or deem applicable any
reserve, special deposit, assessment, or similar requirement (other
than the Eurodollar Reserve Requirement utilized in the determination
of the Adjusted Eurodollar Rate) relating to any extensions of credit
or other assets of, or any deposits with or other liabilities or
commitments of, such Lender (or its Applicable Lending Office),
including the Commitment of such Lender hereunder; or
(iii) shall impose on such Lender (or its Applicable
Lending Office) or the London interbank market any other condition
affecting this Credit Agreement or its Notes or any of such extensions
of credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such Lender
(or its Applicable Lending Office) of making, converting into, continuing, or
maintaining any Eurodollar Loans or to reduce any sum received or receivable by
such Lender (or its Applicable Lending Office) under this Credit Agreement or
its Notes with respect to any Eurodollar Loans, then the Borrowers shall pay to
such Lender on demand such amount or amounts as will compensate such Lender for
such increased cost or reduction. If any Lender requests compensation by the
Borrowers under this Section 3.9, the Borrowers may, by notice to such Lender
(with a copy to the Administrative Agent), suspend the obligation of such Lender
to make or continue Eurodollar Loans, or to convert Base Rate Loans into
Eurodollar Loans, until the event or condition giving rise to such request
ceases to be in effect (in which case the provisions of Section 3.10 shall be
applicable); provided that such suspension shall not affect the right of such
Lender to receive the compensation so requested. Each Lender shall promptly
notify the Borrowers and the Administrative Agent of any event of which it has
knowledge, occurring after the date hereof, which will entitle such Lender to
compensation pursuant to this Section 3.9 and will designate a different
Applicable Lending Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the judgment of such Lender,
be otherwise disadvantageous to it. Any Lender claiming compensation under this
Section 3.9 shall furnish to the Borrowers and the Administrative Agent a
statement setting forth in reasonable detail the additional amount or amounts to
be paid to it
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hereunder which shall be conclusive in the absence of manifest or demonstrable
error. In determining such amount, such Lender may use any reasonable averaging
and attribution methods. No Lender shall be entitled to receive any compensation
for such amounts incurred more than 180 days prior to the delivery of such
statement. If any Credit Party is required to pay compensation to any Lender
pursuant to this Section 3.9, then such Lender will agree to use reasonable
efforts to change the jurisdiction of its Applicable Lending Office so as to
eliminate or reduce any such additional compensation which may thereafter accrue
if such change in the judgment of the Lender, is not otherwise disadvantageous
to such Lender. The Lenders agree that in the exercise of rights under this
Section 3.9, they will accord the Borrowers the treatment generally accorded by
the Lenders to similarly situated borrowers.
3.10 TREATMENT OF AFFECTED LOANS.
If the obligation of any Lender to make any Eurodollar Loan or to
continue, or to convert Base Rate Loans into, Eurodollar Loans shall be
suspended pursuant to Section 3.8 or 3.9 hereof, such Lender's Eurodollar Loans
shall be automatically converted into Base Rate Loans on the last day(s) of the
then current Interest Period(s) for such Eurodollar Loans (or, in the case of a
conversion required by Section 3.8 hereof, on such earlier date as such Lender
may specify to the Borrowers with a copy to the Administrative Agent) and,
unless and until such Lender gives notice as provided below that the
circumstances specified in Section 3.8 or 3.9 hereof that gave rise to such
conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have
been so converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Eurodollar Loans shall be applied
instead to its Base Rate Loans; and
(b) all Loans that would otherwise be made or continued by
such Lender as Eurodollar Loans shall be made or continued instead as
Base Rate Loans, and all Base Rate Loans of such Lender that would
otherwise be converted into Eurodollar Loans shall remain as Base Rate
Loans.
If such Lender gives notice to the Borrowers (with a copy to the Administrative
Agent) that the circumstances specified in Section 3.8 or 3.9 hereof that gave
rise to the conversion of such Lender's Eurodollar Loans pursuant to this
Section 3.10 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Eurodollar Loans, to the extent necessary so that, after giving
effect thereto, all Loans held by the Lenders holding Eurodollar Loans and by
such Lender are held pro rata (as to principal amounts, interest rate basis, and
Interest Periods) in accordance with their respective Commitments.
3.11 TAXES.
(a) Any and all payments by any Credit Party to or for the
account of any Lender or the Administrative Agent hereunder or under
any other Credit Document shall be made free and clear of and without
deduction for any and all present or future taxes, duties,
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levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto, excluding, in the case of each Lender
and the Administrative Agent, taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction under the laws of
which such Lender (or its Applicable Lending Office) or the
Administrative Agent (as the case may be) is organized or any political
subdivision thereof (all such non-excluded taxes, duties, levies,
imposts, deductions, charges, withholdings, and liabilities being
hereinafter referred to as "Taxes"). If any Credit Party shall be
required by law to deduct any Taxes from or in respect of any sum
payable under this Credit Agreement or any other Credit Document to any
Lender or the Administrative Agent, (i) the sum payable shall be
increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section 3.11) such Lender or the Administrative Agent receives an
amount equal to the sum it would have received had no such deductions
been made, (ii) such Credit Party shall make such deductions, (iii)
such Credit Party shall pay the full amount deducted to the relevant
taxation authority or other authority in accordance with applicable
law, and (iv) such Credit Party shall furnish to the Administrative
Agent, at its address referred to in Section 11.1, the original or a
certified copy of a receipt evidencing payment thereof.
(b) In addition, the Borrowers agree to pay any and all
present or future stamp or documentary taxes and any other excise or
property taxes or charges or similar levies which arise from any
payment made under this Credit Agreement or any other Credit Document
or from the execution or delivery of, or otherwise with respect to,
this Credit Agreement or any other Credit Document (hereinafter
referred to as "Other Taxes").
(c) The Borrowers agree to indemnify each Lender and the
Administrative Agent for the full amount of Taxes and Other Taxes
(including, without limitation, any Taxes or Other Taxes imposed or
asserted by any jurisdiction on amounts payable under this Section
3.11) paid by such Lender or the Administrative Agent (as the case may
be) and any liability (including penalties, interest, and expenses)
arising therefrom or with respect thereto.
(d) Each Lender that is not a United States person under
Section 7701(a)(30) of the Code, on or prior to the date of its
execution and delivery of this Credit Agreement in the case of each
Lender listed on the signature pages hereof and on or prior to the date
on which it becomes a Lender in the case of each other Lender, and from
time to time thereafter if requested in writing by the Borrowers or the
Administrative Agent (but only so long as such Lender remains lawfully
able to do so), shall provide the Borrowers and the Administrative
Agent with (i) Internal Revenue Service Form 1001 or 4224, as
appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Lender is entitled to benefits under an
income tax treaty to which the United States is a party which reduces
the rate of withholding tax on payments of interest or certifying that
the income receivable pursuant to this Credit Agreement is effectively
connected with the conduct of a trade or business in the United States,
(ii) Internal Revenue Service Form W-8 or W-9, as appropriate, or any
successor form prescribed by the Internal Revenue Service, and (iii)
any other form or certificate required by any taxing authority
(including any certificate required by Sections 871(h) and 881(c) of
the Internal Revenue Code), certifying
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that such Lender is entitled to an exemption from or a reduced rate of
tax on payments pursuant to this Credit Agreement or any of the other
Credit Documents.
(e) For any period with respect to which a Lender has failed
to provide the Borrowers and the Administrative Agent with the
appropriate form pursuant to Section 3.11(d) (unless such failure is
due to a change in treaty, law, or regulation occurring subsequent to
the date on which a form originally was required to be provided), such
Lender shall not be entitled to indemnification under Section 3.11(a)
or 3.11(b) with respect to Taxes imposed by the United States;
provided, however, that should a Lender, which is otherwise exempt from
or subject to a reduced rate of withholding tax, become subject to
Taxes because of its failure to deliver a form required hereunder, the
Borrowers shall take such steps as such Lender shall reasonably request
to assist such Lender to recover such Taxes.
(f) If any Credit Party is required to pay additional amounts
to or for the account of any Lender pursuant to this Section 3.11, then
such Lender will agree to use reasonable efforts to change the
jurisdiction of its Applicable Lending Office so as to eliminate or
reduce any such additional payment which may thereafter accrue if such
change, in the judgment of such Lender, is not otherwise
disadvantageous to such Lender.
(g) Within thirty (30) days after the date of any payment of
Taxes, the applicable Credit Party shall furnish to the Administrative
Agent the original or a certified copy of a receipt evidencing such
payment.
(h) Without prejudice to the survival of any other agreement
of the Credit Parties hereunder, the agreements and obligations of the
Credit Parties contained in this Section 3.11 shall survive the
repayment of the Loans and other obligations under the Credit Documents
and the termination of the Commitments hereunder.
3.12 COMPENSATION.
Upon the request of any Lender, the Borrowers shall pay to such Lender
such amount or amounts as shall be sufficient (in the reasonable opinion of such
Lender) to compensate it for any loss, cost, or expense incurred by it as a
result of:
(a) any payment, prepayment, or conversion of a Eurodollar
Loan for any reason (including, without limitation, the acceleration of
the Loans pursuant to Section 9.2) on a date other than the last day of
the Interest Period for such Loan; or
(b) any failure by the Borrowers for any reason (including,
without limitation, the failure of any condition precedent specified in
Section 5 to be satisfied) to borrow, convert, continue, or prepay a
Eurodollar Loan on the date for such borrowing, conversion,
continuation, or prepayment specified in the relevant notice of
borrowing, prepayment, continuation, or conversion under this Credit
Agreement.
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With respect to Eurodollar Loans, such indemnification may include an amount
equal to the excess, if any, of (a) the amount of interest which would have
accrued on the amount so prepaid, or not so borrowed, converted or continued,
for the period from the date of such prepayment or of such failure to borrow,
convert or continue to the last day of the applicable Interest Period (or, in
the case of a failure to borrow, convert or continue, the Interest Period that
would have commenced on the date of such failure) in each case at the applicable
rate of interest for such Eurodollar Loans provided for herein (excluding,
however, the Applicable Percentage included therein, if any) over (b) the amount
of interest (as reasonably determined by such Lender) which would have accrued
to such Lender on such amount by placing such amount on deposit for a comparable
period with leading banks in the interbank Eurodollar market. The covenants of
the Borrowers set forth in this Section 3.12 shall survive the repayment of the
Loans and other obligations under the Credit Documents and the termination of
the Commitments hereunder.
3.13 PRO RATA TREATMENT.
Except to the extent otherwise provided herein:
(a) Loans. Each Loan, each payment or (subject to the terms of
Section 3.3) prepayment of principal of any Loan, each payment of
interest on the Loans, each payment of Unused Fees, each reduction in
Commitments and each conversion or extension of any Loan, shall be
allocated pro rata among the Lenders in accordance with the respective
principal amounts of their outstanding Revolving Loans and
Participation Interests.
(b) Advances. No Lender shall be responsible for the failure
or delay by any other Lender in its obligation to make its ratable
share of a borrowing hereunder; provided, however, that the failure of
any Lender to fulfill its obligations hereunder shall not relieve any
other Lender of its obligations hereunder. Unless the Administrative
Agent shall have been notified in writing by any Lender prior to the
date of any requested borrowing that such Lender does not intend to
make available to the Administrative Agent its ratable share of such
borrowing to be made on such date, the Administrative Agent may assume
that such Lender has made such amount available to the Administrative
Agent on the date of such borrowing, and the Administrative Agent in
reliance upon such assumption, may (in its sole discretion but without
any obligation to do so) make available to the Borrowers a
corresponding amount. If such corresponding amount is not in fact made
available to the Administrative Agent, the Administrative Agent shall
be able to recover such corresponding amount from such Lender. If such
Lender does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent will
promptly notify the Borrowers, and the Borrowers shall immediately pay
such corresponding amount to the Administrative Agent. The
Administrative Agent shall also be entitled to recover from the Lender
or the Borrowers, as the case may be, interest on such corresponding
amount in respect of each day from the date such corresponding amount
was made available by the Administrative Agent to the Borrowers to the
date such corresponding amount is recovered by the Administrative Agent
at a per annum rate equal to (i) from the Borrowers at the applicable
rate for the applicable borrowing pursuant to the Notice of Borrowing
and (ii) from a Lender at the Federal Funds Rate.
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3.14 SHARING OF PAYMENTS.
The Lenders agree among themselves that, in the event that any Lender
shall obtain payment in respect of any Loan or any other obligation owing to
such Lender under this Credit Agreement through the exercise of a right of
setoff, banker's lien or counterclaim, or pursuant to a secured claim under
Section 506 of Title 11 of the United States Code or other security or interest
arising from, or in lieu of, such secured claim, received by such Lender under
any applicable bankruptcy, insolvency or other similar law or otherwise, or by
any other means, in excess of its pro rata share of such payment as provided for
in this Credit Agreement, such Lender shall promptly purchase from the other
Lenders a Participation Interest in such Loans and other obligations in such
amounts, and make such other adjustments from time to time, as shall be
equitable to the end that all Lenders share such payment in accordance with
their respective ratable shares as provided for in this Credit Agreement. The
Lenders further agree among themselves that if payment to a Lender obtained by
such Lender through the exercise of a right of setoff, banker's lien,
counterclaim or other event as aforesaid shall be rescinded or must otherwise be
restored, each Lender which shall have shared the benefit of such payment shall,
by repurchase of a Participation Interest theretofore sold, return its share of
that benefit (together with its share of any accrued interest payable with
respect thereto) to each Lender whose payment shall have been rescinded or
otherwise restored. The Borrowers agree that any Lender so purchasing such a
Participation Interest may, to the fullest extent permitted by law, exercise all
rights of payment, including setoff, banker's lien or counterclaim, with respect
to such Participation Interest as fully as if such Lender were a holder of such
Loan or other obligation in the amount of such Participation Interest. Except as
otherwise expressly provided in this Credit Agreement, if any Lender or the
Administrative Agent shall fail to remit to the Administrative Agent or any
other Lender an amount payable by such Lender or the Administrative Agent to the
Administrative Agent or such other Lender pursuant to this Credit Agreement on
the date when such amount is due, such payments shall be made together with
interest thereon for each date from the date such amount is due until the date
such amount is paid to the Administrative Agent or such other Lender at a rate
per annum equal to the Federal Funds Rate. If under any applicable bankruptcy,
insolvency or other similar law, any Lender receives a secured claim in lieu of
a setoff to which this Section 3.14 applies, such Lender shall, to the extent
practicable, exercise its rights in respect of such secured claim in a manner
consistent with the rights of the Lenders under this Section 3.14 to share in
the benefits of any recovery on such secured claim.
3.15 PAYMENTS, COMPUTATIONS, ETC.
(a) Except as otherwise specifically provided herein, all
payments hereunder shall be made to the Administrative Agent in dollars
in immediately available funds, without setoff, deduction, counterclaim
or withholding of any kind, at the Administrative Agent's office
specified in Schedule 2.1(a)(i) not later than 1:00 P.M. (Charlotte,
North Carolina time) on the date when due. Payments received after such
time shall be deemed to have been received on the next succeeding
Business Day. The Administrative Agent may (but shall not be obligated
to) debit the amount of any such payment which is not made by such time
to any ordinary deposit account of any of the Borrowers or any other
Operative Party maintained with the Administrative Agent (with notice
to the Borrowers or such other Operative Party). The Borrowers (or any
one of them) shall, at the time it makes any
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payment under this Credit Agreement, specify to the Administrative
Agent the Loans, Fees, interest or other amounts payable by the
Borrowers hereunder to which such payment is to be applied (and in the
event that it fails so to specify, or if such application would be
inconsistent with the terms hereof, the Administrative Agent shall
distribute such payment to the Lenders in such manner as the
Administrative Agent may determine to be appropriate in respect of
obligations owing by the Borrowers hereunder, subject to the terms of
Section 3.13(a)). The Administrative Agent will distribute such
payments to such Lenders, if any such payment is received prior to 1:00
P.M. (Charlotte, North Carolina time) on a Business Day in like funds
as received prior to the end of such Business Day and otherwise the
Administrative Agent will distribute such payment to such Lenders on
the next succeeding Business Day. If the Administrative Agent fails to
distribute such payment on the next succeeding Business Day, then the
amount of such payment shall bear interest payable to the Lenders at a
rate equal to the Federal Funds Rate. Whenever any payment hereunder
shall be stated to be due on a day which is not a Business Day, the due
date thereof shall be extended to the next succeeding Business Day
(subject to accrual of interest and Fees for the period of such
extension), except that in the case of Eurodollar Loans, if the
extension would cause the payment to be made in the next following
calendar month, then such payment shall instead be made on the next
preceding Business Day. Unless the Administrative Agent receives notice
from a Borrower prior to the date on which any payment is due to the
Lenders that such Borrower will not make such payment in full as and
when required, the Administrative Agent may assume that such Borrower
has made such payment in full to the Administrative Agent on such date
in immediately available funds and the Administrative Agent may (but
shall not be so required), in reliance upon such assumption, distribute
to each Lender on such date an amount equal to the amount then due such
Lender. If and to the extent such Borrower has not made such payment in
full to the Administrative Agent, each Lender shall repay to the
Administrative Agent on demand such amount distributed to such Lender,
together with interest thereon at the Federal Funds Rate for each day
from the date such amount is distributed to such lender until the date
repaid. Except as expressly provided otherwise herein, all computations
of interest and fees shall be made on the basis of actual number of
days elapsed over a year of 360 days, except with respect to
computation of interest on Base Rate Loans which (unless the Base Rate
is determined by reference to the Federal Funds Rate) shall be
calculated based on a year of 365 or 366 days, as appropriate. Interest
shall accrue from and include the date of borrowing, but exclude the
date of payment.
(b) Allocation of Payments After Event of Default.
(i) Fees and Expenses. Notwithstanding any other
provisions of this Credit Agreement to the contrary, after the
occurrence and during the continuance of an Event of Default,
all amounts collected or received by the Administrative Agent
or any Lender on account of the Credit Party Obligations or
any other amounts outstanding under any of the Credit
Documents or in respect of the Collateral shall be paid over
or delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation reasonable
attorneys' fees) of the Administrative Agent
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then due and owing in connection with enforcing the rights of
the Lenders under the Credit Documents and any protective
advances made by the Administrative Agent with respect to the
Collateral under or pursuant to the terms of the Collateral
Documents;
SECOND, to payment of any fees then due and owing to
the Administrative Agent;
THIRD, to the payment of all reasonable out-of-pocket
costs and expenses (including without limitation, reasonable
attorneys' fees) of each of the Lenders then due and owing in
connection with enforcing its rights under the Credit
Documents or otherwise with respect to the Credit Party
Obligations owing to such Lender;
In carrying out the foregoing, (A) amounts received shall be
applied in the numerical order provided until exhausted prior
to application to the next succeeding category; and (B) each
of the Lenders shall receive an amount equal to its pro rata
share (based on the proportion that the then outstanding Loans
held by such Lender bears to the aggregate then outstanding
Loans) of amounts available to be applied pursuant to clause
"THIRD" above.
(ii) Pool A Obligations. Notwithstanding any other
provisions of this Credit Agreement to the contrary, after (A)
the occurrence and during the continuance of an Event of
Default and (B) all fees, costs and expenses identified in
Section 3.15(b)(i) have been paid in full, all amounts
collected or received by the Administrative Agent or any
Lender on account of the Pool A Obligations or any other
amounts owing from a Pool A Borrower outstanding under any of
the Credit Documents or in respect of the Pool A Collateral
shall be paid over or delivered as follows:
FIRST, to the payment of all of the Pool A
Obligations consisting of accrued fees and interest;
SECOND, to the payment of the outstanding principal
amount of the Pool A Obligations;
THIRD , to all other Pool A Obligations and other
obligations of the Pool A Borrowers which shall have become
due and payable under the Credit Documents or otherwise and
not repaid pursuant to clauses "FIRST" through "THIRD" above;
and
FOURTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (x) amounts received shall be
applied in the numerical order provided until exhausted prior
to application to the next succeeding category; and (y) each
of the Lenders shall receive an amount equal to its pro rata
share (based on the proportion that the then outstanding Pool
A Loans
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held by such Lender bears to the aggregate then outstanding
Pool A Loans) of amounts available to be applied pursuant to
clauses "FIRST", "SECOND" and "THIRD" above.
(iii) Pool B Obligations. Notwithstanding any other
provisions of this Credit Agreement to the contrary, after (A)
the occurrence and during the continuance of an Event of
Default and (B) all fees, costs and expenses in Section
3.15(b)(i) have been paid in full, all amounts collected or
received by the Administrative Agent or any Lender on account
of the Pool B Obligations or any other amounts owing from a
Pool B Borrower outstanding under any of the Credit Documents
or in respect of the Pool B Collateral shall be paid over or
delivered as follows:
FIRST, to the payment of all of the Pool B
Obligations consisting of accrued fees and interest;
SECOND, to the payment of the outstanding principal
amount of the Pool B Obligations;
THIRD, to all other Pool B Obligations and other
obligations of the Pool B Borrowers which shall have become
due and payable under the Credit Documents or otherwise and
not repaid pursuant to clauses "FIRST" through "THIRD" above;
and
FOURTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (x) amounts received shall be
applied in the numerical order provided until exhausted prior
to application to the next succeeding category; and (y) each
of the Lenders shall receive an amount equal to its pro rata
share (based on the proportion that the then outstanding Pool
B Loans held by such Lender bears to the aggregate then
outstanding Pool B Loans) of amounts available to be applied
pursuant to clauses "FIRST", "SECOND" and "THIRD" above.
(iv) Pool C Obligations. Notwithstanding any other
provisions of this Credit Agreement to the contrary, after (A)
the occurrence and during the continuance of an Event of
Default and (B) all fees, costs and expenses in Section
3.15(b)(i) have been paid in full, all amounts collected or
received by the Administrative Agent or any Lender on account
of the Pool C Obligations or any other amounts owing from a
Pool C Borrower outstanding under any of the Credit Documents
or in respect of the Pool C Collateral shall be paid over or
delivered as follows:
FIRST, to the payment of all of the Pool C
Obligations consisting of accrued fees and interest;
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SECOND, to the payment of the outstanding principal
amount of the Pool C Obligations;
THIRD, to all other Pool C Obligations and other
obligations of the Pool C Borrowers which shall have become
due and payable under the Credit Documents or otherwise and
not repaid pursuant to clauses "FIRST" through "THIRD" above;
and
FOURTH, to the payment of the surplus, if any, to
whoever may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (A) amounts received shall be
applied in the numerical order provided until exhausted prior
to application to the next succeeding category; and (B) each
of the Lenders shall receive an amount equal to its pro rata
share (based on the proportion that the then outstanding Pool
C Loans held by such Lender bears to the aggregate then
outstanding Pool C Loans) of amounts available to be applied
pursuant to clauses "FIRST", "SECOND" and "THIRD" above.
(v) HCR/Alterra/Parent. Notwithstanding the foregoing
provisions of this Section 3.15(b) to the contrary, after the
occurrence and during the continuance of an Event of Default,
all amounts collected or received by the Administrative Agent
or any Lender directly from the Parent, HCR or Alterra on
account of the Credit Party Obligations or any other amounts
outstanding under any of the Credit Documents (including,
without limitation, any amounts collected on account of (i)
the Collateral provided by HCR, Alterra and the Parent
(specifically including the equity in the Pool A Borrowers,
the Pool B Borrowers and the Pool C Borrowers pledged by the
Parent to the Administrative Agent, for the benefit of the
Lenders) or (ii) any set off by any Lender of deposits held by
such Lender by such Lenders for HCR, Alterra or the Parent
shall be paid over or delivered to satisfy the Credit Party
Obligations and shall be paid over or delivered as follows:
FIRST, to the payment of the fees, costs and expenses
identified in Section 3.15(b)(i) in the numerical order
provided therein until exhausted prior to application to the
next succeeding category; and
SECOND, following the payment of all fees, costs and
expenses identified in Section 3.15(b)(i), to the payment of
those obligations then due and owing identified in Sections
3.15(b)(ii), 3.15(b)(iii) and 3.15(b)(iv) in the numerical
order provided in such Sections; provided, however, the
Administrative Agent shall determine in its sole discretion
how collections will be allocated between obligations
identified in Sections 3.15(b)(ii), Section 3.15(b)(iii) and
Section 3.15(b)(iv).
3.16 EVIDENCE OF DEBT.
(a) Each Lender shall maintain an account or accounts
evidencing each Loan made by such Lender to any Borrower from time to
time, including the amounts of principal
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and interest payable and paid to such Lender from time to time under
this Credit Agreement. Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update
its account or accounts from time to time, as necessary.
(b) The Administrative Agent shall maintain the Register
pursuant to Section 11.3(c), and a subaccount for each Lender, in which
Register and subaccounts (taken together) shall be recorded (i) the
amount, type and Interest Period of each such Loan hereunder, (ii) the
amount of any principal or interest due and payable or to become due
and payable to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder from or for the account
of any Credit Party and each Lender's share thereof. The Administrative
Agent will make reasonable efforts to maintain the accuracy of the
subaccounts referred to in the preceding sentence and to promptly
update such subaccounts from time to time, as necessary.
(c) The entries made in the accounts, Register and subaccounts
maintained pursuant to subsection (b) of this Section 3.16 (and, if
consistent with the entries of the Administrative Agent, subsection (a)
shall be prima facie evidence of the existence and amounts of the
obligations of the Credit Parties therein recorded; provided, however,
that the failure of any Lender or the Administrative Agent to maintain
any such account, such Register or such subaccount, as applicable, or
any error therein, shall not in any manner affect the obligation of the
Credit Parties to repay the Credit Party Obligations owing to such
Lender.
3.17 SUBSTITUTION OF LENDERS.
Upon the receipt by the Borrowers from any Lender (an "Affected
Lender") of a claim for compensation under Section 3.9 or Section 3.11, or in
the event any Lender whose obligations to make Eurodollar Loans have been
suspended under Section 3.8, the Borrowers may: (i) request the Affected Lender
to use its reasonable efforts to obtain a replacement bank or financial
institution satisfactory to the Borrowers to acquire and assume all or a ratable
part of all of such Affected Lender's Revolving Loans and Revolving Commitment
(a "Replacement Lender"); (ii) request one more of the other Lenders to acquire
and assume all or part of such Affected Lender's Revolving Loans and Revolving
Commitment; or (iii) designate an Eligible Assignee that is willing to become
the assignee of the Revolving Loans, the Revolving Commitment and other
obligations of such Lender under the Credit Agreement. Any such designation of a
Replacement Lender under clause (i) or (iii) shall be subject to the prior
written consent of the Administrative Agent (which consent shall not be
unreasonably withheld).
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SECTION 4
GUARANTY
4.1 THE PARENT GUARANTY.
The Parent hereby guarantees to each Lender, each Affiliate of a Lender
that enters into a Hedging Agreement with any Operative Party, and the
Administrative Agent as hereinafter provided, as primary obligor and not as
surety, (a) the prompt payment of the Credit Party Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) strictly in accordance with the
terms thereof and (b) the timely performance of all other obligations of the
Borrowers under the Credit Documents, including, without limitation, that the
Eligible Projects will be constructed in accordance with this Credit Agreement
and applicable law. The Parent hereby further agrees that if any of the Credit
Party Obligations are not paid in full when due (whether at stated maturity, as
a mandatory prepayment, by acceleration, as a mandatory cash collateralization
or otherwise), the Parent will promptly pay the same, without any demand or
notice whatsoever, and that in the case of any extension of time of payment or
renewal of any of the Credit Party Obligations, the same will be promptly paid
in full when due (whether at extended maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or otherwise) in accordance
with the terms of such extension or renewal. The Parent further agrees to (x)
assume all responsibility for the completion of the Eligible Projects and, at
the Parent's own cost and expense, to cause the Eligible Projects to be fully
completed in accordance with the plans and specifications provided to the
Administrative Agent in accordance with the terms hereof and in accordance with
this Credit Agreement, (y) pay all bills in connection with the construction of
the Eligible Projects and (z) indemnify and hold the Lenders harmless from any
and all loss, cost, liability or expense the Lenders may suffer by reason of any
such event (except if such event is due to the gross negligence or willful
misconduct of the Administrative Agent or the Lenders).
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents or Hedging Agreements of any Operative Party,
the obligations of the Parent hereunder shall be limited to an aggregate amount
equal to the largest amount that would not render its obligations hereunder
subject to avoidance under Section 548 of the Bankruptcy Code or any comparable
provisions of any applicable state law.
4.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Parent under Section 4.1 are joint and several,
absolute and unconditional, irrespective of the value, genuineness, validity,
regularity or enforceability of any of the Credit Documents or Hedging
Agreements of any Operative Party, or any other agreement or instrument referred
to therein, or any substitution, release, impairment or exchange of any other
guarantee of or security for any of the Credit Party Obligations, and, to the
fullest extent permitted by applicable law, irrespective of any other
circumstance whatsoever which might otherwise constitute a legal or equitable
discharge or defense of a surety or guarantor, it being the intent of this
Section 4.2 that the obligations of the Parent hereunder shall be absolute and
unconditional under any and all circumstances. The Parent agrees that it shall
have no right of subrogation, indemnity,
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reimbursement or contribution against a Borrower or any other Guarantor for
amounts paid under this Section 4 until such time as the Lenders (and any
Affiliates of Lenders entering into Hedging Agreements with any Operative Party)
have been paid in full (other than contingent indemnification obligations which
survive), all Commitments under this Credit Agreement have been terminated and
no Person or Governmental Authority shall have any right to request any return
or reimbursement of funds from the Lenders in connection with monies received
under the Credit Documents or Hedging Agreements with any Operative Party.
Without limiting the generality of the foregoing, it is agreed that, to the
fullest extent permitted by law, the occurrence of any one or more of the
following shall not alter or impair the liability of the Parent hereunder which
shall remain absolute and unconditional as described above:
(a) at any time or from time to time, without notice to any
Guarantor, the time for any performance of or compliance with any of
the Credit Party Obligations shall be extended, or such performance or
compliance shall be waived;
(b) any of the acts mentioned in any of the provisions of any
of the Credit Documents, any Hedging Agreement with any Operative Party
or any other agreement or instrument referred to in the Credit
Documents or such Hedging Agreements shall be done or omitted;
(c) the maturity of any of the Credit Party Obligations shall
be accelerated, or any of the Credit Party Obligations shall be
modified, supplemented or amended in any respect, or any right under
any of the Credit Documents, any Hedging Agreement with any Operative
Party or any other agreement or instrument referred to in the Credit
Documents or such Hedging Agreements shall be waived or any other
guarantee of any of the Credit Party Obligations or any security
therefor shall be released, impaired or exchanged in whole or in part
or otherwise dealt with;
(d) any Lien granted to, or in favor of, the Administrative
Agent or any Lender or Lenders as security for any of the Credit Party
Obligations shall fail to attach or be perfected; or
(e) any of the Credit Party Obligations shall be determined to
be void or voidable (including, without limitation, for the benefit of
any creditor of any Guarantor) or shall be subordinated to the claims
of any Person (including, without limitation, any creditor of any
Guarantor).
With respect to its obligations hereunder, the Parent hereby expressly waives
diligence, presentment, demand of payment, protest and all notices whatsoever,
and any requirement that the Administrative Agent or any Lender exhaust any
right, power or remedy or proceed against any Person under any of the Credit
Documents, any Hedging Agreement with any Operative Party or any other agreement
or instrument referred to in the Credit Documents or such Hedging Agreements, or
against any other Person under any other guarantee of, or security for, any of
the Credit Party Obligations.
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4.3 REINSTATEMENT.
The obligations of the Parent under this Section 4 shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and the Parent agrees that it will indemnify the
Administrative Agent and each Lender on demand for all reasonable costs and
expenses (including, without limitation, fees and expenses of counsel) incurred
by the Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
4.4 CERTAIN ADDITIONAL WAIVERS.
The Parent agrees that it shall have no right of recourse to security
for the Credit Party Obligations, except through the exercise of rights of
subrogation in accordance with Section 4.2.
4.5 REMEDIES.
The Parent agrees that, to the fullest extent permitted by law, the
Credit Party Obligations may be declared to be forthwith due and payable as
provided in Section 9.2 (and shall be deemed to have become automatically due
and payable in the circumstances provided in said Section 9.2) for purposes of
Section 4.1 notwithstanding any stay, injunction or other prohibition preventing
such declaration (or preventing the Credit Party Obligations from becoming
automatically due and payable) as against any other Person and that, in the
event of such declaration (or the Credit Party Obligations being deemed to have
become automatically due and payable), the Credit Party Obligations (whether or
not due and payable by any other Person) shall forthwith become due and payable
by the Parent for purposes of Section 4.1. The Parent acknowledges and agrees
that its obligations hereunder are secured in accordance with the terms of the
Pledge Agreement and the other Collateral Documents and that the Administrative
Agent and Lenders may exercise their remedies thereunder in accordance with the
terms thereof.
4.6 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guarantee of the Parent in this Section 4 is a guaranty of payment
and not of collection, is a continuing guarantee, and shall apply to all Credit
Party Obligations whenever arising.
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SECTION 5
CONDITIONS
5.1 CLOSING CONDITIONS.
The obligation of the Lenders to enter into this Credit Agreement and
to make the initial Loans shall be subject to satisfaction of the following
conditions (in form and substance acceptable to the Lenders):
(a) Executed Credit Documents. Receipt by the Administrative
Agent of duly executed copies of: (i) this Credit Agreement, (ii) the
Notes, (iii) the Guaranty Agreements; (iv) the Collateral Documents and
(v) all other Credit Documents, each in form and substance acceptable
to the Administrative Agent in its sole discretion.
(b) Corporate Documents. Receipt by the Administrative
Agent of the following:
(i) Charter Documents. Copies of the articles or
certificates of incorporation or organization, as applicable,
or other charter documents of each Credit Party certified to
be true and complete as of a recent date by the appropriate
Governmental Authority of the state or other jurisdiction of
its incorporation or organization or operating agreement and
certified by a secretary, assistant secretary or manager of
such Credit Party to be true and correct as of the Closing
Date.
(ii) Bylaws/Operating Agreement. A copy of the bylaws
or operating agreement of each Credit Party certified by a
secretary, assistant secretary or manager of such Credit Party
to be true and correct as of the Closing Date.
(iii) Resolutions. Copies of resolutions of each
Credit Party approving and adopting the Credit Documents to
which it is a party, the transactions contemplated therein and
authorizing execution and delivery thereof, certified by a
secretary, assistant secretary or manager of such Credit Party
to be true and correct and in force and effect as of the
Closing Date.
(iv) Good Standing. Copies of certificates of good
standing, existence or its equivalent with respect to each
Credit Party certified as of a recent date by the appropriate
Governmental Authorities of the state or other jurisdiction of
incorporation or organization and each other jurisdiction in
which the failure to so qualify and be in good standing could
have a Material Adverse Effect.
(v) Incumbency. An incumbency certificate of each
Credit Party certified by a secretary, assistant secretary or
manager to be true and correct as of the Closing Date.
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(c) Opinions of Counsel. The Administrative Agent shall have
received legal opinions of counsel (which shall cover, among other
things, authority, legality, validity, binding effect and
enforceability) in form and substance reasonably satisfactory to the
Administrative Agent dated as of the Closing Date from counsel to the
Credit Parties.
(d) Personal Property Collateral. The Administrative Agent
shall have received:
(i) searches of Uniform Commercial Code filings in
the jurisdiction of the chief executive office of each
Borrower and each jurisdiction where any Collateral is located
or where a filing would need to be made in order to perfect
the Administrative Agent's security interest in the
Collateral, copies of the financing statements on file in such
jurisdictions and evidence that no Liens exist other than
Permitted Liens;
(ii) duly executed UCC financing statements for each
appropriate jurisdiction as is necessary, in the
Administrative Agent's sole discretion, to perfect the
Administrative Agent's security interest, for the benefit of
the Lenders, in the Collateral;
(iii) all stock certificates, if any, evidencing the
Capital Stock pledged to the Administrative Agent, for the
benefit of the Lenders, pursuant to the Pledge Agreement,
together with duly executed in blank, undated stock powers
attached thereto;
(iv) all instruments and chattel paper in the
possession of any of the Borrowers, together with allonges or
assignments as may be necessary or appropriate to perfect the
Administrative Agent's security interest, for the benefit of
the Lenders, in the Collateral; and
(v) duly executed consents as are necessary, in the
Administrative Agent's reasonable discretion, to perfect the
Administrative Agent's security interest, for the benefit of
the Lenders, in the Collateral.
(e) Real Property Collateral. The Administrative Agent shall
have received, in form and substance satisfactory to the Administrative
Agent:
(i) fully executed and notarized mortgages, deeds of
trust or deeds to secure debt in favor of the Administrative
Agent (each such mortgage, deed of trust and deed to secure
debt referenced above shall be referred to herein as a
"Mortgage" and collectively as "Mortgages") for the real
property assets owned by a Borrower set forth on Schedule
5.1(e)(i) (each of these real property assets on Schedule
5.1(e)(i) being an "Existing Property" and collectively the
"Existing Properties"), together with such UCC-1 financing
statements, as the Administrative Agent shall deem appropriate
with respect to each such Existing Property;
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(ii) ALTA or other appropriate form mortgagee title
insurance policies (the "Mortgage Policies") issued by a title
insurer reasonably satisfactory to the Administrative Agent
(the "Title Insurance Company"), in an amount satisfactory to
the Administrative Agent with respect to each Existing
Property, assuring the Administrative Agent that the
applicable Existing Mortgages create valid and enforceable
first priority mortgage liens on the respective Existing
Properties, free and clear of all defects and encumbrances
except Permitted Liens which Mortgage Policies shall be in
form and substance satisfactory to the Administrative Agent
and containing such endorsements as shall be satisfactory to
the Administrative Agent and for any other matters that the
Administrative Agent may request, and providing affirmative
insurance and such reinsurance as the Administrative Agent may
request, all of the foregoing in form and substance reasonably
satisfactory to the Administrative Agent;
(iii) map or plat of a survey of the sites of the
Existing Properties certified to the Administrative Agent and
the Title Insurance Company in a manner reasonably
satisfactory to them, dated a date satisfactory to the
Administrative Agent and the Title Insurance Company by an
independent professional licensed land surveyor reasonably
satisfactory to the Administrative Agent and the Title
Insurance Company, and otherwise in form and substance
satisfactory to the Administrative Agent (if a Facility has
been constructed on such Existing Property the survey must be
an "as built" survey);
(iv) an opinion of counsel (which counsel shall be
reasonably satisfactory to the Administrative Agent) in the
state in which each Existing Property is located with respect
to the enforceability of the Mortgages, standard remedies with
respect thereto, and sufficiency of the form of UCC-1
financing statements to be recorded or filed in such state and
such other matters as the Administrative Agent may reasonably
request, in form and substance satisfactory to the
Administrative Agent;
(v) certification from the applicable Borrower's land
surveyor in a form reasonably satisfactory to the
Administrative Agent or other evidence reasonably acceptable
to the Administrative Agent that none of the improvements on
the Existing Properties are located within any area designated
by the Director of the Federal Emergency Management Agency as
a "special flood hazard" area or if any improvements on the
Existing Properties are located within a "special flood
hazard" area, evidence of a flood insurance policy from a
company and in an amount satisfactory to the Administrative
Agent for the applicable portion of the premises, naming the
Administrative Agent, for the benefit of the Lenders, as
mortgagee;
(vi) an appraisal (in form and substance satisfactory
to the Administrative Agent) with respect to each Existing
Property from a qualified appraiser satisfactory to the
Administrative Agent;
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(vii) an environmental assessment (in form and
substance satisfactory to the Administrative Agent) of each
Existing Property from a consulting firm reasonably acceptable
to the Administrative Agent;
(viii) a set of plans and specifications for the
construction of the Facility on each Existing Property in form
and substance satisfactory to the Administrative Agent;
(ix) (i) with respect to any Facility which will be
constructed on each Existing Property using the proceeds of
the Loans, projections for such Facility for the two year
period subsequent to its construction completion date in form
and substance satisfactory to the Administrative Agent and
(ii) with respect to any Facility on an Existing Property
which will be refinanced using proceeds of the Loans,
projections for such Facility for the two year period
subsequent to the refinancing in form and substance
satisfactory to the Administrative Agent;
(x) with respect to any Existing Property, a
Development Budget for such Facility on each Existing Property
(which such Development Budget has been reviewed by the
Engineer and recommended by the Engineer to the Administrative
Agent as an acceptable Development Budget); and
(xi) a subordination and assignment of management
agreement with respect to the Facility on each Existing
Property.
(f) Construction Contract. The Administrative Agent shall have
received (i) a copy of the construction contract for the Facility to be
constructed on each Existing Property and (ii) a certified copy of the
Management Agreement for each Existing Property.
(g) Priority of Liens. The Administrative Agent shall have
received satisfactory evidence that (i) the Administrative Agent, on
behalf of the Lenders, holds a perfected, first priority Lien on all
Collateral and (ii) none of the Collateral is subject to any other
Liens other than Permitted Liens.
(h) Corporate Structure. The capital and ownership structure
(including articles of organization), equityholder agreements and
management of each of the Borrowers and the Parent shall be in form and
substance satisfactory to the Lenders, and receipt by the
Administrative Agent of a certificate from each of the Borrowers
evidencing receipt of equity on terms satisfactory to the Lenders.
(i) Opening Borrowing Base. Receipt by the Administrative
Agent of a Borrowing Base Certificate as of the Closing Date, certified
by each of the chief financial officers of the Designated Borrowers to
be true and correct as of the Closing Date.
(j) Evidence of Insurance. Receipt by the Administrative Agent
of copies of insurance policies or certificates of insurance of the
Borrowers evidencing liability and
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casualty insurance meeting the requirements set forth in the Credit
Documents, including, but not limited to, naming the Administrative
Agent as sole loss payee or additional insured, as appropriate, on
behalf of the Lenders.
(k) Government Consent. Receipt by the Administrative Agent of
evidence that all governmental, shareholder and material third party
consents and approvals necessary in connection with the transactions
contemplated hereby and expiration of all applicable waiting periods
without any action being taken by any authority that could reasonably
be likely to restrain, prevent or impose any material adverse
conditions on such other transactions or that could reasonably be
likely to seek or threaten any of the foregoing, and no law or
regulation shall be applicable which in the judgment of the
Administrative Agent could reasonably be likely to have such effect.
(l) Material Adverse Effect. Since December 31, 1998, there
has been no change in the condition (financial or otherwise), business,
assets, operations, management or, if applicable, prospects of a Credit
Party or any of its Subsidiaries which could reasonably be expected to
cause a Material Adverse Effect.
(m) Litigation. There shall not exist any pending or
threatened action, suit, investigation or proceeding against a Credit
Party or any of its Subsidiaries that could reasonably be expected to
have a Material Adverse Effect.
(n) Officer's Certificates.
(a) The Administrative Agent shall have received a
certificate or certificates executed by an Executive Officer of the
Parent, in its capacity as general partner, of each of the Initial Pool
A Borrowers as of the Closing Date stating, with respect to the Initial
Pool A Borrowers, that (i) each Initial Pool A Borrower is in
compliance with all existing financial obligations, (ii) all
governmental, shareholder and third party consents and approvals, if
any, with respect to the Credit Documents and the transactions
contemplated thereby have been obtained, (iii) no action, suit,
investigation or proceeding is pending or threatened in any court or
before any arbitrator or governmental instrumentality that purports to
affect any Initial Pool A Borrower or any transaction contemplated by
the Credit Documents, if such action, suit, investigation or proceeding
could have a Material Adverse Effect, and (iv) immediately after giving
effect to this Credit Agreement, the other Credit Documents and all the
transactions contemplated therein to occur on such date, (1) each
Initial Pool A Borrower is Solvent, (2) no Default or Event of Default
exists, (3) all representations and warranties contained herein and in
the other Credit Documents are true and correct in all material
respects, and (4) the Operative Parties are in compliance with each of
the financial covenants set forth in Section 7.11.
(b) The Administrative Agent shall have received a
certificate or certificates executed by an Executive Officer of each
Guarantor, as of the Closing Date (i) stating that such Guarantor is in
compliance with all existing material financial obligations, (ii)
stating that immediately after giving effect to this Credit Agreement,
the Credit Documents and all transactions contemplated therein, such
Guarantor is Solvent, (iii) with
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respect to each of HCR and Alterra respectively, stating that such
Guarantor is in compliance with the financial covenants applicable to
it set forth in the HCR Guaranty Agreement and Alterra Guaranty
Agreement and (iv) with respect to HCR, certifying as to the Senior
Debt Rating.
(o) Fees and Expenses. Payment by the Credit Parties of all
fees and expenses owed by them to the Lenders and the Administrative
Agent, including, without limitation, payment to the Administrative
Agent of the fees set forth in the Fee Letter.
(p) The Initial Pool A Subordinated Debt. Receipt by the
Administrative Agent of evidence that each of the Initial Pool A
Borrowers (other than Clare Bridge Parma and Clare Bridge Westchase)
shall have received the proceeds from the issuance of the Initial Pool
A Subordinated Debt pursuant to terms in accordance with the terms of
Section 8.1(e) and otherwise acceptable to the Administrative Agent.
(q) Other. Receipt by the Lenders of such other documents,
instruments, agreements or information as reasonably requested by any
Lender, including, but not limited to, information regarding
litigation, tax, accounting, labor, insurance, pension liabilities
(actual or contingent), real estate leases, material contracts, debt
agreements, property ownership and contingent liabilities of the Credit
Parties and their Subsidiaries.
5.2 CONDITIONS TO ALL EXTENSIONS OF CREDIT.
(i) Pool A Loans. The obligations of each Lender to make,
convert or extend any Pool A Loan (including the initial Pool A Loans)
are subject to satisfaction of the following conditions in addition (x)
to satisfaction on the Closing Date of the conditions set forth in
Section 5.1 and (y) with respect to any Pool A Loan used to finance the
construction or refinancing of a New Property the satisfaction of the
conditions set forth in Section 5.3:
(a) The Designated Borrower shall have delivered (i)
a Notice of Borrowing or Notice of Extension/Conversion and
(ii) together with such Notice of Borrowing or Notice of
Extension/Conversion, a Borrowing Base Certificate, duly
executed by the applicable Designated Borrower;
(b) The representations and warranties made by HCR
(with respect to itself and its Subsidiaries), Alterra (with
respect to itself and its Subsidiaries), the Parent (with
respect to itself and the Pool A Borrowers) and the Pool A
Borrowers in the Credit Documents shall, subject to the
limitations set forth therein, be true and correct in all
material respects as of such date (except for those which
expressly relate to an earlier date);
(c) There shall not have been commenced against any
Credit Party or the Subsidiary of any Operative Party an
involuntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or any case,
proceeding or other action for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of such Person or for any
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substantial part of its Property or for the winding up or
liquidation of its affairs, and such involuntary case or other
case, proceeding or other action shall remain undismissed,
undischarged or unbonded;
(d) No Default with respect to any Pool A Borrower or
Event of Default or Pool A Event of Default shall exist and be
continuing either prior to or after giving effect thereto;
(e) No circumstances, events or conditions shall have
occurred since December 31, 1998 which would reasonably be
expected to have a Material Adverse Effect with respect to any
Pool A Borrower, the Parent, HCR and its Subsidiaries taken as
a whole, or Alterra and its Subsidiaries taken as a whole;
(f) Immediately after giving effect to the making of
such Pool A Loan (and the application of the proceeds thereof)
(i) the sum of the aggregate principal amount of outstanding
Revolving Loans shall not exceed the lesser of (x) the
Revolving Committed Amount and (y) the Borrowing Base and (ii)
the aggregate amount of outstanding Revolving Loans with
respect to such Eligible Project shall not exceed such
Eligible Project's Eligible Project Loan Amount; and
(g) There has been no change in the state of the
title to the Pool A Properties other than Permitted Liens,
there are no liens on any Pool A Properties other than
Permitted Liens and there are no survey exceptions on the Pool
A Properties not approved by the Administrative Agent.
The delivery of each Notice of Borrowing by the Pool A Designated
Borrower and each Notice of Extension/Conversion by the Pool A
Designated Borrower shall constitute a representation and warranty by
HCR, Alterra, the Parent (with respect to itself and each of the Pool A
Borrowers) and the Pool A Borrowers of the correctness of the matters
specified in subsections (b), (c), (d), (e), (f) and (g) of this
Section 5.2(i).
(ii) Pool B Loans. The obligations of each Lender to make,
convert or extend any Pool B Loan (including the initial Pool B Loans)
are subject to satisfaction of the following conditions in addition (x)
to satisfaction on the Closing Date of the conditions set forth in
Section 5.1 and (y) with respect to any Pool B Loan used to finance the
construction or refinancing of a New Property the satisfaction of the
conditions set forth in Section 5.3:
(a) The Designated Borrower shall have delivered (i)
a Notice of Borrowing or Notice of Extension/Conversion and
(ii) together with such Notice of Borrowing or Notice of
Extension/Conversion, a Borrowing Base Certificate, duly
executed by the applicable Designated Borrower;
(b) The representations and warranties made by HCR
(with respect to itself and its Subsidiaries), Alterra (with
respect to itself and its Subsidiaries), the Parent (with
respect to itself and each of the Pool B Borrowers) and the
Pool B Borrowers in the Credit Documents shall, subject to the
limitations set forth therein,
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be true and correct in all material respects as of such date
(except for those which expressly relate to an earlier date);
(c) There shall not have been commenced against any
Credit Party or the Subsidiary of any Operative Party an
involuntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or any case,
proceeding or other action for the appointment of a receiver,
liquidator, assignee, custodian, trustee, sequestrator (or
similar official) of such Person or for any substantial part
of its Property or for the winding up or liquidation of its
affairs, and such involuntary case or other case, proceeding
or other action shall remain undismissed, undischarged or
unbonded;
(d) No Default with respect to any Pool B Borrower or
Event of Default or Pool B Event of Default shall exist and be
continuing either prior to or after giving effect thereto;
(e) No circumstances, events or conditions shall have
occurred since December 31, 1998 which would reasonably be
expected to have a Material Adverse Effect with respect to any
Pool B Borrower, the Parent, HCR and its Subsidiaries taken as
a whole or Alterra and its Subsidiaries taken as a whole; and
(f) Immediately after giving effect to the making of
such Pool B Loan (and the application of the proceeds thereof)
(i) the sum of the aggregate principal amount of outstanding
Revolving Loans shall not exceed the lesser of (x) the
Revolving Committed Amount and (y) the Borrowing Base and (ii)
the aggregate amount of outstanding Revolving Loans with
respect to such Eligible Project shall not exceed such
Eligible Project's Eligible Project Loan Amount; and
(g) There has been no change in the state of the
title to the Pool B Properties other than Permitted Liens,
there are no liens on any of the Pool B Properties other than
Permitted Liens and there are no survey exceptions on the Pool
B Properties not approved by the Administrative Agent.
The delivery of each Notice of Borrowing by the Pool B Designated
Borrower and each Notice of Extension/Conversion by the Pool B
Designated Borrower shall constitute a representation and warranty by
HCR, Alterra, the Parent (with respect to itself and each of the Pool B
Borrowers) and the Pool B Borrowers of the correctness of the matters
specified in subsections (b), (c), (d), (e), (f) and (g) of this
Section 5.2(ii).
(iii) Pool C Loans. The obligations of each Lender to make,
convert or extend any Pool C Loan (including the initial Pool C Loans)
are subject to satisfaction of the following conditions in addition (x)
to satisfaction on the Closing Date of the conditions set forth in
Section 5.1 and (y) with respect to any Pool C Loan used to finance the
construction or refinancing of a New Property the satisfaction of the
conditions set forth in Section 5.3:
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(a) The Designated Borrower shall have delivered (i) a Notice of
Borrowing or Notice of Extension/Conversion and (ii) together with such
Notice of Borrowing or Notice of Extension/Conversion, a Borrowing Base
Certificate, duly executed by the applicable Designated Borrower;
(b) The representations and warranties made by HCR (with respect
to itself and its Subsidiaries), Alterra (with respect to itself and
its Subsidiaries), the Parent (with respect to itself and each of the
Pool C Borrowers) and the Pool C Borrowers in the Credit Documents
shall, subject to the limitations set forth therein, be true and
correct in all material respects as of such date (except for those
which expressly relate to an earlier date);
(c) There shall not have been commenced against any Credit Party
or any Subsidiary of any Operative Party an involuntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or any case, proceeding or other action for the appointment
of a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of its
Property or for the winding up or liquidation of its affairs, and such
involuntary case or other case, proceeding or other action shall remain
undismissed, undischarged or unbonded;
(d) No Default with respect to any Pool C Borrower or Event of
Default or Pool C Event of Default shall exist and be continuing either
prior to or after giving effect thereto;
(e) No circumstances, events or conditions shall have occurred
since December 31, 1998 which would reasonably be expected to have a
Material Adverse Effect with respect to any Pool C Borrower, the
Parent, HCR and its Subsidiaries taken as a whole or Alterra and its
Subsidiaries taken as a whole;
(f) Immediately after giving effect to the making of such Pool C
Loan (and the application of the proceeds thereof) (i) the sum of the
aggregate principal amount of outstanding Revolving Loans shall not
exceed the lesser of (x) the Revolving Committed Amount and (y) the
Borrowing Base and (ii) the aggregate amount of outstanding Revolving
Loans with respect to such Eligible Project shall not exceed such
Eligible Project's Eligible Project Loan Amount; and
(g) There has been no change in the state of the title to the
Pool C Properties other than Permitted Liens, there are no liens on any
of the Pool C Properties other than Permitted Liens and there are no
survey exceptions on the Pool C Properties not approved by the
Administrative Agent.
The delivery of each Notice of Borrowing by the Pool C Designated Borrower
and each Notice of Extension/Conversion by the Pool C Designated Borrower
shall constitute a representation and warranty by HCR, Alterra, the Parent
(with respect to itself and each of
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the Pool C Borrowers) and the Pool C Borrowers of the correctness of the
matters specified in subsections (b), (c), (d), (e), (f) and (g) of this
Section 5.2(iii).
5.3 CONDITIONS TO REVOLVING LOANS TO FINANCE CONSTRUCTION OR REFINANCING
OF NEW PROPERTIES.
The obligation of the Lenders to advance Revolving Loans to finance the
construction or refinancing of a New Property is subject to satisfaction of the
following conditions in addition to satisfaction of the conditions set forth in
Section 5.2:
(a) Eligible Project. Such New Property shall (i) conform with the
definition of Eligible Project and (ii) after such financing be free from
all Liens other than Permitted Liens.
(b) Joinder. All of the conditions set forth in Section 2.3 with
respect hereof to such New Property and the applicable Applicant Borrower
shall have been satisfied.
SECTION 6
REPRESENTATIONS AND WARRANTIES
Each Operative Party hereby represents with respect to itself and its
Subsidiaries to the Administrative Agent and each Lender that:
6.1 FINANCIAL CONDITION.
The financial statements delivered to the Lenders pursuant to Section
7.1(a) present fairly (on the basis disclosed in the footnotes to such financial
statements) the financial condition, results of operations and cash flows of the
Parent as of such date and for such periods. Since December 31, 1998, (i) there
has been no sale, transfer or other disposition by the Parent of any part of the
business or property of the Parent, and (ii) no purchase or other acquisition by
the Parent of any business or property (including any capital stock of any other
Person) material in relation to financial condition of the Parent, which is not
reflected in the foregoing financial statements or in the notes thereto and has
not otherwise been disclosed in writing to the Lenders on or prior to the
Closing Date. As of the Closing Date, the Parent has no material liabilities
(contingent or otherwise) that are not reflected in the foregoing financial
statements or in the notes thereto.
6.2 NO MATERIAL CHANGE.
Since December 31, 1998 (a) there has been no development or event relating
to or affecting such Operative Party or any of its Subsidiaries which has had or
could reasonably be expected to have a Material Adverse Effect and (b) except as
otherwise permitted under this Credit Agreement, no dividends or other
distributions have been declared, paid or made upon the Capital Stock in such
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Operative Party or any of its Subsidiaries nor has any of the Capital Stock in
such Operative Party or any of its Subsidiaries been redeemed, retired,
purchased or otherwise acquired for value.
6.3 ORGANIZATION AND GOOD STANDING.
Such Operative Party (a) is duly organized, validly existing and is in good
standing under the laws of the jurisdiction of its incorporation or
organization, (b) has the corporate or other necessary power and authority, and
the legal right, to own and operate its property, to lease the property it
operates as lessee and to conduct the business in which it is currently engaged
and (c) is duly qualified as a foreign entity and in good standing under the
laws of each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification, other than in such
jurisdictions where the failure to be so qualified and in good standing could
reasonably be expected to have a Material Adverse Effect.
6.4 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
Such Operative Party has the corporate or other necessary power and
authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party, and in the case of each of the Borrowers, to
obtain extensions of credit hereunder, and has taken all necessary corporate
action to authorize the borrowings and other extensions of credit on the terms
and conditions of this Credit Agreement and to authorize the execution, delivery
and performance of the Credit Documents to which it is a party. No consent or
authorization of, filing with, notice to or other similar act by or in respect
of, any Governmental Authority or any other Person is required to be obtained or
made by or on behalf of any Operative Party in connection with the borrowings or
other extensions of credit hereunder or with the execution, delivery,
performance, validity or enforceability of the Credit Documents to which such
Operative Party is a party, except for filings to perfect the Liens created by
the Collateral Documents. This Credit Agreement has been, and each other Credit
Document to which any Operative Party is a party will be, duly executed and
delivered on behalf of such Operative Party. This Credit Agreement constitutes,
and each other Credit Document to which such Operative Party is a party when
executed and delivered will constitute, a legal, valid and binding obligation of
such Operative Party enforceable against such party in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
6.5 NO CONFLICTS.
Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Operative Party will
(a) violate or conflict with any provision of its articles or certificate of
incorporation or certificate of limited partnership or bylaws or partnership
agreement or operating agreement or other organizational or governing documents
of such Person, (b) violate, contravene or materially conflict with any
Requirement of Law or any other law, regulation (including, without limitation,
Regulation U or Regulation X), order, writ, judgment, injunction, decree or
permit applicable to it, (c) violate, contravene or conflict with contractual
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provisions of, or cause an event of default under, any indenture, loan
agreement, mortgage, deed of trust, contract or other agreement or instrument to
which it is a party or by which it may be bound, the violation of which would
reasonably be expected to have a Material Adverse Effect, or (d) result in or
require the creation of any Lien (other than those contemplated in or created in
connection with the Credit Documents) upon or with respect to its properties.
6.6 NO DEFAULT.
Neither such Operative Party, nor any of its Subsidiaries, is in
default in any respect under any contract, lease, loan agreement, indenture,
mortgage, security agreement or other agreement or obligation to which it is a
party or by which any of its properties is bound which default could reasonably
be expected to have a Material Adverse Effect. No Default or Event of Default
has occurred or exists except as previously disclosed in writing to the Lenders.
6.7 OWNERSHIP.
Such Operative Party and each of its Subsidiaries is the owner of, and
has good and marketable title to, all of its respective assets and none of such
assets is subject to any Lien other than Permitted Liens.
6.8 LITIGATION.
There are no actions, suits or legal, equitable, arbitration or
administrative proceedings, pending or, to the knowledge of any Operative Party,
threatened against an Operative Party or any of its Subsidiaries which might
reasonably be expected to have a Material Adverse Effect.
6.9 TAXES.
Such Operative Party and each of its Subsidiaries has filed, or caused
to be filed, all tax returns (federal, state, local and foreign) required to be
filed and paid (a) all amounts of taxes shown thereon to be due (including
interest and penalties) and (b) all other taxes, fees, assessments and other
governmental charges (including mortgage recording taxes, documentary stamp
taxes and intangibles taxes) owing by it, except for such taxes (i) which are
not yet delinquent or (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP. No Operative Party is aware of any proposed tax
assessments against it or any of its Subsidiaries.
6.10 COMPLIANCE WITH LAW.
Such Operative Party and each of its Subsidiaries is in compliance with
all Requirements of Law and all other laws, rules, regulations, orders and
decrees (including without limitation Environmental Laws) applicable to it, or
to its properties, unless such failure to comply could not reasonably be
expected to have a Material Adverse Effect.
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6.11 ERISA.
(a) During the five-year period prior to the date on which
this representation is made or deemed made: (i) no ERISA Event has
occurred, and, to the best knowledge of such Operative Party, no event
or condition has occurred or exists as a result of which any ERISA
Event could reasonably be expected to occur, with respect to any Plan;
(ii) no "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA and Section 412 of the Code, whether or not
waived, has occurred with respect to any Plan; (iii) each Plan has been
maintained, operated, and funded in compliance with its own terms and
in material compliance with the provisions of ERISA, the Code, and any
other applicable federal or state laws; and (iv) no lien in favor of
the PBGC or a Plan has arisen or is reasonably likely to arise on
account of any Plan.
(b) The actuarial present value of all "benefit liabilities"
(as defined in Section 4001(a)(16) of ERISA), whether or not vested,
under each Single Employer Plan, as of the last annual valuation date
prior to the date on which this representation is made or deemed made
(determined, in each case, in accordance with Financial Accounting
Standards Board Statement 87, utilizing the actuarial assumptions used
in such Plan's most recent actuarial valuation report), did not exceed
as of such valuation date the fair market value of the assets of such
Plan.
(c) Neither such Operative Party, nor any of its Subsidiaries,
nor any ERISA Affiliate has incurred, or, to the best knowledge of such
Operative Party, could be reasonably expected to incur, any withdrawal
liability under ERISA to any Multiemployer Plan. Neither such Operative
Party, nor any of its Subsidiaries, nor any ERISA Affiliate would
become subject to any withdrawal liability under ERISA if such
Operative Party or any of its Subsidiaries or any ERISA Affiliate were
to withdraw completely from all Multiemployer Plans as of the valuation
date most closely preceding the date on which this representation is
made or deemed made. Neither such Operative Party nor any of its
Subsidiaries nor any ERISA Affiliate has received any notification that
any Multiemployer Plan is in reorganization (within the meaning of
Section 4241 of ERISA), is insolvent (within the meaning of Section
4245 of ERISA), or has been terminated (within the meaning of Title IV
of ERISA), and no Multiemployer Plan is, to the best knowledge of such
Operative Party, reasonably expected to be in reorganization,
insolvent, or terminated.
(d) No prohibited transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility has occurred with respect to a Plan which has subjected
or may subject such Operative Party or any of its Subsidiaries or any
ERISA Affiliate to any liability under Sections 406, 409, 502(i), or
502(l) of ERISA or Section 4975 of the Code, or under any agreement or
other instrument pursuant to which such Operative Party or any of its
Subsidiaries or any ERISA Affiliate has agreed or is required to
indemnify any Person against any such liability.
(e) Neither such Operative Party, nor any of its Subsidiaries
nor any ERISA Affiliate has any material liability with respect to
"expected post-retirement benefit obligations" within the meaning of
the Financial Accounting Standards Board Statement
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106. Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the Code
apply has been administered in compliance in all material respects of
such sections.
(f) Neither the execution and delivery of this Credit
Agreement nor the consummation of the financing transactions
contemplated thereunder will involve any transaction which is subject
to the prohibitions of Sections 404, 406 or 407 of ERISA or in
connection with which a tax could be imposed pursuant to Section 4975
of the Code. The representation by the Operative Parties in the
preceding sentence is made in reliance upon and subject to the accuracy
of the Lenders' representation in Section 11.16 with respect to their
source of funds and is subject, in the event that the source of the
funds used by the Lenders in connection with this transaction is an
insurance company's general asset account, to the application of
Prohibited Transaction Class Exemption 95-60, 60 Fed. Reg. 35,925
(1995), compliance with the regulations issued under Section
401(c)(1)(A) of ERISA, or the issuance of any other prohibited
transaction exemption or similar relief, to the effect that assets in
an insurance company's general asset account do not constitute assets
of an "employee benefit plan" within the meaning of Section 3(3) of
ERISA of a "plan" within the meaning of Section 4975(e)(1) of the Code.
6.12 SUBSIDIARIES.
Set forth on Schedule 6.12 is a complete and accurate list of all
Subsidiaries of such Operative Party. Information on Schedule 6.12 includes
jurisdiction of incorporation, the number of shares of each class of Capital
Stock outstanding, the number and percentage of outstanding shares of each class
owned (directly or indirectly) by such Operative Party; and the number and
effect, if exercised, of all outstanding options, warrants, rights of conversion
or purchase and all other similar rights with respect thereto. The outstanding
Capital Stock of all such Subsidiaries of the Operative Parties is validly
issued, fully paid and non-assessable and is owned by each such Operative Party,
directly or indirectly, free and clear of all Liens (other than those arising
under or contemplated in connection with the Credit Documents). Other than as
set forth in Schedule 6.12, no Operative Party has outstanding any securities
convertible into or exchangeable for its Capital Stock nor does any such Person
have outstanding any rights to subscribe for or to purchase or any options for
the purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to
its Capital Stock. None of the Borrowers own any Subsidiaries. Schedule 6.12 may
be updated from time to time by the Operative Parties by giving written notice
thereof to the Administrative Agent.
6.13 GOVERNMENTAL REGULATIONS, ETC.
(a) No part of the proceeds of the Loans will be used, directly
or indirectly, for the purpose of purchasing or carrying any "margin
stock" within the meaning of Regulation U, or for the purpose of
purchasing or carrying or trading in any securities. If requested by
any Lender or the Administrative Agent, the Borrowers will furnish to
the Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form U-1 referred to
in Regulation U. No indebtedness being reduced or retired out of the
proceeds of the Loans was or will be incurred for the purpose of
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purchasing or carrying any margin stock within the meaning of
Regulation U or any "margin security" within the meaning of Regulation
T. "Margin stock" within the meaning of Regulation U does not
constitute more than 25% of the value of the consolidated assets of the
Borrowers or the Operative Parties. None of the transactions
contemplated by this Credit Agreement (including, without limitation,
the direct or indirect use of the proceeds of the Loans) will violate
or result in a violation of the Securities Act of 1933, as amended, or
the Securities Exchange Act of 1934, as amended, or regulations issued
pursuant thereto, or Regulation T, U or X.
(b) Neither such Operative Party, nor any of its Subsidiaries,
is subject to regulation under the Public Utility Holding Company Act
of 1935, the Federal Power Act or the Investment Company Act of 1940,
each as amended. In addition, no Credit Party, nor any of their
Subsidiaries, is (i) an "investment company" registered or required to
be registered under the Investment Company Act of 1940, as amended, and
is not controlled by such a company, or (ii) a "holding company", or a
"subsidiary company" of a "holding company", or an "affiliate" of a
"holding company" or of a "subsidiary" of a "holding company", within
the meaning of the Public Utility Holding Company Act of 1935, as
amended.
(c) Such Operative Party and its Subsidiaries has obtained and
holds in full force and effect, all franchises, licenses, permits,
certificates, authorizations, qualifications, accreditations,
easements, rights of way and other rights, consents and approvals which
are necessary for the ownership of its respective Property and to the
conduct of its respective businesses as presently conducted.
(d) Neither such Operative Party, nor any of its Subsidiaries,
is in violation of any applicable statute, regulation or ordinance of
the United States of America, or of any state, city, town,
municipality, county or any other jurisdiction, or of any agency
thereof (including without limitation, environmental laws and
regulations), which violation could reasonably be expected to have a
Material Adverse Effect.
(e) Such Operative Party and each of its Subsidiaries is
current with all material reports and documents, if any, required to be
filed with any state or federal securities commission or similar agency
and is in full compliance in all material respects with all applicable
rules and regulations of such commissions.
6.14 Purpose of Loans.
(a) The proceeds of the Pool A Loans hereunder shall be used
solely by the Pool A Borrowers to (i) finance the acquisition and/or
construction, development and working capital needs of Eligible
Projects or (ii) refinance Eligible Projects.
(b) The proceeds of the Pool B Loans hereunder shall be used
solely by the Pool B Borrowers to (i) finance the acquisition and/or
construction, development and working capital needs of Eligible
Projects or (ii) refinance Eligible Projects.
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(c) The proceeds of the Pool C Loans hereunder shall be used
solely by the Pool C Borrowers to (i) finance the acquisition and/or
construction, development and working capital needs of Eligible
Projects or (ii) refinance Eligible Projects.
(d) Eighty percent (80%) of the proceeds of the Loans shall be
used by the Borrowers to finance the acquisition and/or construction,
development and working capital needs or refinancing of Eligible
Projects dedicated to individuals with Alzheimer's disease.
6.15 ENVIRONMENTAL MATTERS.
(a) Each of the facilities and properties owned, leased or
operated by such Operative Party or any of its Subsidiaries (the
"Properties") and all operations at the Properties are in compliance
with all applicable Environmental Laws, and there is no violation of
any Environmental Law with respect to the Properties or the businesses
operated by the Operative Parties or any of their Subsidiaries (the
"Businesses"), and there are no conditions relating to the Businesses
or Properties that could give rise to material liability under any
applicable Environmental Laws.
(b) None of the Properties contains, or has previously
contained, any Materials of Environmental Concern at, on or under the
Properties in amounts or concentrations that constitute or constituted
a material violation of, or could give rise to material liability
under, Environmental Laws.
(c) Neither such Operative Party, nor any of its Subsidiaries,
has received any written or verbal notice of, or inquiry from any
Governmental Authority regarding, any violation, alleged violation,
non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard
to any of the Properties or the Businesses, nor does such Operative
Party have knowledge or reason to believe that any such notice will be
received or is being threatened.
(d) Materials of Environmental Concern have not been
transported or disposed of from the Properties, or generated, treated,
stored or disposed of at, on or under any of the Properties, in each
case by or on behalf of such Operative Party or any of its Subsidiaries
in violation of, or in a manner that could give rise to material
liability under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or administrative
action is pending or, to the best knowledge of such Operative Party,
threatened, under any Environmental Law to which such Operative Party
or any of its Subsidiaries is or will be named as a party, nor are
there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with
respect to such Operative Party, any of its Subsidiaries, the
Properties or the Businesses.
(f) There has been no release, or threat of release, of
Materials of Environmental Concern at or from the Properties, or
arising from or related to the operations (including,
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without limitation, disposal) of such Operative Party or any of its
Subsidiaries in connection with the Properties or otherwise in
connection with the Businesses, in violation of or in amounts or in a
manner that could give rise to material liability under Environmental
Laws.
6.16 INTELLECTUAL PROPERTY.
Such Operative Party owns, or has the legal right to use, all
patents, trademarks, tradenames, copyrights, technology, know-how and processes
(the "Intellectual Property") necessary for each of them to conduct its business
as currently conducted except for those the failure to own or have such legal
right to use could not reasonably be expected to have a Material Adverse Effect.
Set forth on Schedule 6.16 is a list of all Intellectual Property owned by each
Borrower or that any Borrower has the right to use. Except as provided on
Schedule 6.16, no claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does any
Borrower know of any such claim, and to the Borrower's knowledge the use of such
Intellectual Property by any Borrower does not infringe on the rights of any
Person, except for such claims and infringements that, in the aggregate, could
not reasonably be expected to have a Material Adverse Effect.
6.17 SOLVENCY.
Such Operative Party is and, after consummation of the transactions
contemplated by this Credit Agreement, will be Solvent.
6.18 LOCATION OF COLLATERAL.
Set forth on Schedule 6.18(a) is a list of all real property located
in the United States and owned or leased by such Borrower with street address,
county and state where located. Set forth on Schedule 6.18(b) is a list of all
locations where any personal property of such Borrower is located, including
county and state where located. Set forth on Schedule 6.18(c) is the chief
executive office and principal place of business of such Operative Party.
Schedules 6.18(a), 6.18(b) and 6.18(c) may be updated from time to time by an
Operative Party by giving written notice to the Administrative Agent.
6.19 DISCLOSURE.
Neither this Credit Agreement nor any financial statements delivered
to the Lenders nor any other document, certificate or statement furnished to the
Lenders by or on behalf of any Operative Party in connection with the
transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact necessary in order to make the statements
contained therein or herein not misleading.
6.20 NO BURDENSOME RESTRICTIONS.
Neither such Operative Party nor any of its Subsidiaries is a party
to any agreement or instrument or subject to any other obligation or any charter
or corporate restriction or any provision
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of any applicable law, rule or regulation which, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect.
6.21 LABOR MATTERS.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of such Operative Party or any of its Subsidiaries, and
such Operative Party and each of its Subsidiaries has not suffered any strikes,
walkouts, work stoppages or other material labor difficulty within the last five
years.
6.22 YEAR 2000 COMPLIANCE.
Such Operative Party has (i) initiated a review and assessment of all
areas within its and each of its Subsidiaries' business and operations that
could be adversely affected by the "Year 2000 Problem" (that is, the risk that
computer applications used by such Operative Party or any of its Subsidiaries
may be unable to recognize and perform properly date-sensitive functions
involving certain dates prior to and any date after December 31, 1999), (ii)
developed a plan and timeline for addressing the Year 2000 Problem on a timely
basis, and (iii) to date, implemented that plan in accordance with the
timetable. Based on the foregoing, each Operative Party believes that all
computer applications that are material to its and any of its Subsidiaries'
business and operations are reasonably expected on a timely basis to be able to
perform properly date-sensitive functions for all dates before and after January
1, 2000 (that is, be "Year 2000 compliant"), except to the extent that a failure
to do so could not reasonably be expected to have a Material Adverse Effect.
6.23 FIRST PRIORITY LIEN.
The Administrative Agent, on behalf of the Lenders, holds a first
priority lien, subject to no other liens other than Permitted Liens, in the
Collateral.
SECTION 7
AFFIRMATIVE COVENANTS
Each Operative Party hereby covenants and agrees with respect to
itself and each of its Subsidiaries that, so long as this Credit Agreement is in
effect or any amounts payable hereunder or under any other Credit Document shall
remain outstanding (other than contingent indemnification obligations which
survive), and until all of the Commitments hereunder shall have terminated:
7.1 INFORMATION COVENANTS.
The Operative Parties will furnish, or cause to be furnished, to the
Administrative Agent and each of the Lenders:
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(a) Quarterly Financial Statements. As soon as available, and in any
event within 45 days after the close of each fiscal quarter of the
Parent (other than the fourth fiscal quarter, in which case 90 days
after the end thereof) a balance sheet and income statement of the
Parent, as of the end of such fiscal quarter, together with related
statements of cash flows for such fiscal quarter, in each case setting
forth in comparative form figures for the corresponding period of the
preceding fiscal year, all such financial information described above to
be in reasonable form and detail and reasonably acceptable to the
Administrative Agent, and accompanied by a certificate of the chief
financial officer of the Parent to the effect that such quarterly
financial statements fairly present in all material respects the
financial condition of the Parent.
(b) Quarterly Operating Statements. As soon as available, and in any
event within 30 days after the close of each fiscal quarter of the
Borrowers, an operating statement for each Eligible Project, together
with (i) for each Eligible Project which has been in operation for at
least five full fiscal quarters following the date of the first resident
occupancy of such Facility, a calculation of the Debt Service Coverage
Ratio of such Eligible Project for the appropriate period, setting forth
in reasonable detail the earnings and expenses of each Eligible Project
for such period, (ii) the Occupancy Rate, as at the end of such fiscal
quarter for each Eligible Project and (iii) comparative figures for the
preceding fiscal quarter, all such information to be in reasonable form
and detail and reasonably acceptable to the Administrative Agent
accompanied by a certificate of the chief financial officer of the
applicable Borrower to the effect that such quarterly operating
statements fairly present in all material respects the operating results
of the applicable Eligible Project.
(c) Monthly Operating Statements. As soon as available, and in any
event within 30 days after the close of each calendar month, an
operating statement for each Eligible Project as of the end of such
calendar month, setting forth in detail the earnings and expenses of
each Eligible Project for such calendar month, together with comparative
form figures for the preceding calendar month, all such information to
be in reasonable form and detail and reasonably acceptable to the
Administrative Agent and accompanied by a certificate of the chief
financial officer of the applicable Borrower to the effect that such
monthly operating statements fairly present in all material respects the
operating results of the applicable Eligible Project, together with the
Occupancy Rate as at the end of such calendar month for each Eligible
Project.
(d) Officer's Certificate. At the time of delivery of the operating
statements provided for in Section 7.1(c) above, a certificate of an
Executive Officer of each Designated Borrower substantially in the form
of Exhibit 7.1(d), (i) demonstrating compliance with the financial
covenants contained in Section 7.11 by calculation thereof as of the end
of each such fiscal period and (ii) stating that no Default or Event of
Default exists, or if any Default or Event of Default does exist,
specifying the nature and extent thereof and what action the Operative
Parties propose to take with respect thereto.
(e) Annual Business Plan and Budgets. Within 30 days following the
commencement of each fiscal year of the Borrowers, beginning with the
fiscal year ending
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December 31, 1999, an operating budget and capital expenditure budget
for each Borrower for the next fiscal year.
(f) Borrowing Base Certificate. Within 30 days after the end of each
fiscal quarter, a Borrowing Base Certificate as of the end of the
immediately preceding fiscal quarter, substantially in the form of
Exhibit 7.1(f) and certified by each of the chief financial officers of
the Designated Borrowers to be true and correct as of such date.
(g) Auditor's Reports. Promptly upon receipt thereof, a copy of any
other report or "management letter" submitted by independent accountants
to any Operative Party in connection with any annual, interim or special
audit of the books of such Person.
(h) Reports. Promptly upon transmission or receipt thereof, (i)
copies of any filings and registrations with, and reports to or from,
the Securities and Exchange Commission, or any successor agency, and
copies of all financial statements, proxy statements, notices and
reports as any Operative Party or any of its Subsidiaries shall send to
its shareholders or to a holder of any Indebtedness owed by any
Operative Party or any of its Subsidiaries in its capacity as such a
holder and (ii) upon the request of the Administrative Agent, all
reports and written information to and from the United States
Environmental Protection Agency, or any state or local agency
responsible for environmental matters, the United States Occupational
Health and Safety Administration, or any state or local agency
responsible for health and safety matters, or any successor agencies or
authorities concerning material environmental, health or safety matters.
(i) Notices. Upon obtaining knowledge thereof, the Operative Parties
will give written notice to the Administrative Agent immediately of (i)
the occurrence of an event or condition consisting of a Default or Event
of Default, specifying the nature and existence thereof and what action
the Operative Parties propose to take with respect thereto, (ii) the
occurrence of any of the following with respect to any Operative Party
or any of its Subsidiaries (A) the pendency or commencement of any
litigation, arbitral or governmental proceeding against such Person
which if adversely determined is likely to have a Material Adverse
Effect, (B) the institution of any proceedings against such Person with
respect to, or the receipt of notice by such Person of potential
liability or responsibility for violation, or alleged violation of any
federal, state or local law, rule or regulation, including but not
limited to, Environmental Laws, the violation of which could reasonably
be expected to have a Material Adverse Effect, or (C) any notice or
determination concerning the imposition of any withdrawal liability by a
Multiemployer Plan against such Person or any ERISA Affiliate, the
determination that a Multiemployer Plan is, or is expected to be, in
reorganization within the meaning of Title IV of ERISA or the
termination of any Plan and (iii) the occurrence of an event of default
under any of the Management Agreements.
(j) ERISA. Upon obtaining knowledge thereof, the Operative Parties
will give written notice to the Administrative Agent promptly (and in
any event within five business days) of: (i) of any event or condition,
including, but not limited to, any Reportable Event, that constitutes,
or might reasonably lead to, an ERISA Event; (ii) with respect to any
Multiemployer Plan, the receipt of notice as prescribed in ERISA or
otherwise of any
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withdrawal liability assessed against the Operative Parties or any of
their Subsidiaries or any ERISA Affiliates, or of a determination that
any Multiemployer Plan is in reorganization or insolvent (both within
the meaning of Title IV of ERISA); (iii) the failure to make full
payment on or before the due date (including extensions) thereof of all
amounts which any Operative Party or any of its Subsidiaries or any
ERISA Affiliate is required to contribute to each Plan pursuant to its
terms and as required to meet the minimum funding standard set forth in
ERISA and the Code with respect thereto; or (iv) any change in the
funding status of any Plan that could have a Material Adverse Effect,
together with a description of any such event or condition or a copy of
any such notice and a statement by an Executive Officer of any Operative
Party, as appropriate, briefly setting forth the details regarding such
event, condition, or notice, and the action, if any, which has been or
is being taken or is proposed to be taken by the Operative Parties with
respect thereto. Promptly upon request, the Operative Parties shall
furnish the Administrative Agent and the Lenders with such additional
information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return (Form
5500 series), as well as all schedules and attachments thereto required
to be filed with the Department of Labor and/or the Internal Revenue
Service pursuant to ERISA and the Code, respectively, for each "plan
year" (within the meaning of Section 3(39) of ERISA).
(k) Environmental.
(i) Subsequent to a notice from any Governmental Authority
where the subject matter of such notice would reasonably cause
concern that a material environmental problem existed at a Property
or during the existence of an Event of Default, and upon the written
request of the Administrative Agent, the Borrowers will furnish or
cause to be furnished to the Administrative Agent, at the Borrowers'
expense, a report of an environmental assessment of reasonable scope,
form and depth, (including, where appropriate, invasive soil or
groundwater sampling) by a consultant reasonably acceptable to the
Administrative Agent as to the nature and extent of the presence of
any Materials of Environmental Concern on any Properties (as defined
in Section 6.15) and as to the compliance by any Operative Party with
Environmental Laws at such Properties. If the Borrowers fail to
deliver such an environmental report within seventy-five (75) days
after receipt of such written request then the Administrative Agent
may arrange for same, and the Borrowers hereby grant to the
Administrative Agent and their representatives access to the
Properties to reasonably undertake such an assessment (including,
where appropriate, invasive soil or groundwater sampling). The
reasonable cost of any assessment arranged for by the Administrative
Agent pursuant to this provision will be payable by the Borrowers on
demand and added to the obligations secured by the Collateral
Documents.
(ii) The Borrowers will conduct and complete all
investigations, studies, sampling, and testing and all remedial,
removal, and other actions necessary to address all Materials of
Environmental Concern on, from or affecting any of the Properties to
the extent necessary to be in compliance with all Environmental Laws
and with the validly issued orders and directives of all Governmental
Authorities
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with jurisdiction over such Properties to the extent any
failure could reasonably be expected to have a Material Adverse
Effect.
(l) Other Information. With reasonable promptness
upon any such request, such other information regarding the business,
properties or financial condition of the Operative Parties as the
Administrative Agent or any Lender (through the Administrative Agent)
may reasonably request.
7.2 PRESERVATION OF EXISTENCE AND FRANCHISES.
Each Operative Party will, and will cause each of its
Subsidiaries to, do all things necessary to preserve and keep in full
force and effect its existence, rights, franchises and authority.
7.3 BOOKS AND RECORDS.
Each Operative Party will, and will cause each of its
Subsidiaries to, keep complete and accurate books and records of its
transactions in accordance with good accounting practices on the
basis of GAAP (including the establishment and maintenance of
appropriate reserves).
7.4 COMPLIANCE WITH LAW.
Each Operative Party will, and will cause each of its
Subsidiaries to, comply with all laws, rules, regulations and orders,
and all applicable restrictions imposed by all Governmental
Authorities, applicable to it and its property if noncompliance with
any such law, rule, regulation, order or restriction could reasonably
be expected to have a Material Adverse Effect.
7.5 PAYMENT OF TAXES AND OTHER INDEBTEDNESS.
Each Operative Party will, and will cause each of its
Subsidiaries to, pay and discharge (a) all taxes, assessments and
governmental charges or levies imposed upon it, or upon its income or
profits, or upon any of its properties, before they shall become
delinquent, (b) all lawful claims (including claims for labor,
materials and supplies) which, if unpaid, might give rise to a Lien
upon any of its properties, and (c) except as prohibited hereunder,
all of its other Indebtedness as it shall become due; provided,
however, that an Operative Party or any of its Subsidiaries shall not
be required to pay any such tax, assessment, charge, levy, claim or
Indebtedness which is being contested in good faith by appropriate
proceedings and as to which adequate reserves therefor have been
established in accordance with GAAP, unless the failure to make any
such payment (i) could give rise to an immediate right to foreclose
on a Lien securing such amounts or (ii) could reasonably be expected
to have a Material Adverse Effect.
7.6 INSURANCE.
(a) Each Borrower hereby agrees that it will at all
times maintain in full force and effect insurance (including, but not
limited to, liability insurance, property insurance and builders risk
insurance) in such amounts and covering such risks and liabilities
and with
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such deductibles as are in accordance with normal industry practice and
the provisions set forth below:
(i) The builder's risk insurance policy with respect to
each Eligible Project of such Borrower shall be an "all-risk"
completed value, non-reporting builder's risk insurance policy
and shall contain provisions for a minimum 30-day advance
written notice to the Administrative Agent of any intended
policy cancellation or non-renewal, (B) a standard mortgagee
endorsement designating the Administrative Agent, for the
benefit of the Lenders, as mortgagee and loss payee and (C) an
endorsement sufficient to eliminate all co-insurance
provisions.
(ii) The commercial general liability insurance maintained
by each of the Borrowers and the general contractor with
respect to each Eligible Project of such Borrower shall (A)
include a liability limit of not less than $1,000,000 per
occurrence and $2,000,000 annually in the aggregate and (B)
include worker's compensation coverage in an amount sufficient
to satisfy statutory requirements.
(iii) The "all-risk" property insurance policy, including
flood, earthquake and business interruption insurance with
respect to each Eligible Project of such Borrower must (i)
contain a replacement cost endorsement sufficient to eliminate
all co-insurance provisions, (ii) include provisions for a
minimum 30-day advance written notice to the Administrative
Agent of any intended policy cancellation or non-renewal and
(iii) designate the Administrative Agent, for the benefit of
the Lenders, as mortgagee and loss payee in a standard
mortgagee endorsement, as its interest may appear.
(b) In the event a Borrower fails to maintain insurance as
required hereunder, the Administrative Agent shall have the right to
procure such insurance whether or not such Borrower's failure to
maintain such insurance constitutes a Default or an Event of Default.
Any amounts paid by the Administrative Agent for insurance shall be due
and payable to the Administrative Agent upon demand and shall be
secured by the Collateral Documents.
(c) In the event of loss, the applicable Borrower shall
promptly give written notice thereof to the Administrative Agent and
the insurance carrier describing the nature and extent of such damage
or destruction. The Administrative Agent may make proof of loss if not
made promptly by such Borrower. The Administrative Agent is hereby
authorized, upon the request and direction of the Required Lenders, to
adjust, compromise and collect the proceeds of any insurance claims.
The Borrowers hereby assign to the Administrative Agent, for the
benefit of the Lenders, the proceeds of any such insurance policies and
hereby directs and authorizes each insurance company to make payment
for such loss directly to the Administrative Agent. In the event a
Borrower shall receive any such insurance proceeds as a result of any
loss, damage or destruction with respect to the Collateral, such
Borrower shall immediately pay over such proceeds to the Administrative
Agent as cash collateral for the Credit Party Obligations. The
Administrative Agent agrees to release insurance proceeds of $1,000,000
or less directly to such Borrower for restoration or repair. The
Administrative Agent agrees to release insurance proceeds in excess of
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$1,000,000 to such Borrower for restoration or repair of the Collateral
damaged provided the following conditions are met:
(i) there exists no Default or Event of Default;
(ii) such Borrower presents sufficient evidence to
the Administrative Agent that there are sufficient funds from
the insurance proceeds (or that sufficient funds from
insurance proceeds can reasonably be expected to be received)
and from equity funds, if needed, to completely restore or
repair the damaged collateral;
(iii) such Borrower presents sufficient evidence to
the Administrative Agent that the damaged Collateral will be
restored prior to the Maturity Date;
(iv) the Administrative Agent will not incur any
liability to any other Person as a result of such use or
release of insurance proceeds; and
(v) the insurance proceeds shall be held by the
Administrative Agent and disbursed substantially in accordance
with the disbursement procedures under Section 2.2 of this
Credit Agreement as repair or restoration progresses as if
such proceeds were Loans.
If the above-referenced conditions of this Section 7.6(c)(i), (ii),
(iii), (iv) and (v) are not satisfied within ninety (90) days of loss,
then the Administrative Agent may, at its option, apply any insurance
proceeds to the payment of the Revolving Loans. The insurance coverage
of each of the Borrowers is outlined as to carrier, policy number,
expiration date, type and amount on Schedule 7.6.
7.7 MAINTENANCE OF PROPERTY.
Each Operative Party will, and will cause each of its Subsidiaries to,
maintain and preserve its properties and equipment material to the conduct of
its business in good repair, working order and condition, normal wear and tear
and casualty and condemnation excepted, and will make, or cause to be made, to
such properties and equipment from time to time all repairs, renewals,
replacements, extensions, additions, betterments and improvements thereto as may
be needed, to the extent and in the manner customary for companies in similar
businesses.
7.8 PERFORMANCE OF OBLIGATIONS.
Each Operative Party will, and will cause each of its Subsidiaries to,
perform in all respects all of its obligations under the terms of all
agreements, indentures, mortgages, security agreements or other debt instruments
to which it is a party or by which it is bound unless the failure to do so could
not have or be reasonably expected to have a Material Adverse Effect.
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7.9 USE OF PROCEEDS.
The Borrowers will use the proceeds of the Loans for the purposes set
forth in Section 6.14.
7.10 AUDITS/INSPECTIONS.
(a) Upon reasonable notice (and in any event upon no less than
two (2) Business Days notice) and during normal business hours, each
Operative Party will permit representatives appointed by the
Administrative Agent, including, without limitation, independent
accountants, agents, attorneys, and appraisers to visit and inspect its
property, including its books and records, its accounts receivable and
inventory, its facilities and its other business assets, and to make
photocopies or photographs thereof and to write down and record any
information such representative obtains and shall permit the
Administrative Agent or its representatives to investigate and verify
the accuracy of information provided to the Lenders and to discuss all
such matters with the officers, employees and representatives of such
Person. Upon the occurrence and during the continuance of an Event of
Default, the Operative Parties agree that the Administrative Agent, and
its representatives, may conduct an audit of the Collateral, at the
expense of the Operative Parties.
(b) Upon reasonable notice (and in any event upon no less than
two (2) Business Days notice), the Borrowers will permit the
Administrative Agent and/or its agents or representatives (including,
without limitation, the Engineer) (at the expense of the Borrowers) to
enter upon any of the Real Properties for the purpose of inspecting the
construction of the Facilities.
7.11 FINANCIAL COVENANTS.
(a) Eligible Project. The Operative Parties hereby covenant
and agree that at least 85% of all Facilities shall be either (i)
Eligible Projects to the extent such Facilities have not been in
operation for five full fiscal quarters following the date of the first
resident occupancy of such Facilities or (ii) Stabilized Eligible
Projects to the extent such Facilities have been in operation for at
least five full fiscal quarters following the date of the first
resident occupancy of such Facilities.
(b) Debt Service. The Operative Parties hereby covenant and
agree that all Facilities of the Borrower which have been in operation
for more than twenty four calendar months shall at all times be
Stabilized Eligible Projects.
7.12 ENVIRONMENTAL LAWS.
(a) The Operative Parties shall comply in all material
respects with, and take reasonable actions to ensure compliance in all
material respects by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply in all material
respects with and maintain, and take reasonable actions to ensure that
all tenants and subtenants obtain and comply in all material respects
with and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable
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Environmental Laws except to the extent that failure to do so would not
reasonably be expected to have a Material Adverse Effect;
(b) The Operative Parties shall conduct and complete all
investigations, studies, sampling and testing, and all remedial,
removal and other actions required under Environmental Laws and
promptly comply in all material respects with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws
except to the extent that the same are being contested in good faith by
appropriate proceedings and the failure to do or the pendency of such
proceedings would not reasonably be expected to have a Material Adverse
Effect; and
(c) The Operative Parties shall defend, indemnify and hold
harmless the Administrative Agent and the Lenders, and their respective
employees, agents, officers and directors, from and against any and all
claims, demands, penalties, fines, liabilities, settlements, damages,
costs and expenses of whatever kind or nature known or unknown,
contingent or otherwise, arising out of, or in any way relating to the
violation of, noncompliance with or liability under, any Environmental
Law applicable to the operations of the Borrowers or the Properties, or
any orders, requirements or demands of Governmental Authorities related
thereto, including, without limitation, reasonable attorney's and
consultant's fees, investigation and laboratory fees, response costs,
court costs and litigation expenses, except to the extent that any of
the foregoing arise out of the gross negligence or willful misconduct
of the party seeking indemnification therefor. The agreements in this
paragraph shall survive repayment of the Loans and all other amounts
payable hereunder, and termination of the Commitments.
7.13 COLLATERAL.
If, subsequent to the Closing Date, a Borrower shall acquire (a) any
real property or (b) any intellectual property, securities instruments, chattel
paper or other personal property required to be delivered to the Administrative
Agent as Collateral hereunder or under any of the Collateral Documents, such
Borrower shall notify the Administrative Agent of same in each case as soon as
practicable after the acquisition thereof. Each Operative Party shall take such
action as requested by the Administrative Agent and at its own expense, to
ensure that the Administrative Agent shall have a first priority perfected Lien
in (i) all real property of the Borrowers (whether now owned or hereafter
acquired) and (ii) all personal property of the Borrowers (whether now owned or
hereafter acquired), subject in each case only to Permitted Liens.
7.14 YEAR 2000 COMPLIANCE.
Each Operative Party will promptly notify the Administrative Agent in
the event such Operative Party discovers or determines that any computer
application that is material to its or any of its Subsidiaries' business and
operations will not be Year 2000 compliant, except to the extent that such
failure could not reasonably be expected to have a Material Adverse Effect.
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7.15 CONSTRUCTION INSPECTOR.
The Operative Parties hereby agree that the Administrative Agent may
hire a construction inspector of the Administrative Agent's choice (at the
expense of the Borrowers) to review during normal business hours the progress of
construction of any Eligible Project at any time during the term of the Credit
Agreement.
7.16 SURVEYS.
Each of the Borrowers hereby agrees that it shall provide the
Administrative Agent with an "as-built" survey (in form and substance
satisfactory to the Administrative Agent) for each Facility which is being
constructed using proceeds of the Loans within 30 Business Days of the
substantial completion of the construction of such Facility.
7.17 ENVIRONMENTAL INDEMNITY.
(i) The Parent and the Pool A Borrowers agree that
they will reimburse the Lenders for and hereby hold the
Lenders harmless from all fines or penalties made or levied
against any of the Lenders by any Governmental Authority as a
result of or in connection with (i) the use of Materials of
Environmental Concern at any Pool A Property, (ii) the use of
Materials of Environmental Concern at the Facilities thereon,
or (iii) the use, generation, storage, transportation,
discharge, release or handling of any Materials of
Environmental Concern at any Pool A Property, or as a result
of any release of any Materials of Environmental Concern onto
the ground or into the water or air from or upon any Pool A
Property at any time. The Parent and the Pool A Borrowers also
agree that they will reimburse the Lenders for and indemnify
and hold the Lenders harmless from any and all costs and
expenses (including reasonable attorneys' fees) and for all
civil judgments or penalties incurred, entered, assessed, or
levied against any of the Lenders as a result of a Pool A
Borrower's use of Materials of Environmental Concern at any
Pool A Property or as a result of any release of any Materials
of Environmental Concern on the ground or into the water or
air by a Pool A Borrower from or upon any Pool A Property.
Such reimbursement or indemnification shall include but not be
limited to any and all judgments or penalties to recover the
costs of cleanup of any such release by a Pool A Borrower from
or upon any Pool A Property and all reasonable expenses
incurred by the Lenders as a result of such a civil action,
including but not limited to reasonable attorneys' fees. The
Parent's and the Pool A Borrowers' obligations under this
Section 7.17(i) shall survive the repayment of the Loans and
any deed in lieu of foreclosure or any foreclosure of a
Mortgage on a Pool A Property.
(ii) The Parent and the Pool B Borrowers agree that
they will reimburse the Lenders for and hereby hold the
Lenders harmless from all fines or penalties made or levied
against any of the Lenders by any Governmental Authority as a
result of or in connection with (i) the use of Materials of
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Environmental Concern at any Pool B Property, (ii) the use of
Materials of Environmental concern at the Facilities thereon,
or (iii) the use, generation, storage, transportation,
discharge, release or handling of any Materials of
Environmental Concern at any Pool B Property, or as a result
of any release of any Materials of Environmental Concern onto
the ground or into the water or air from or upon any Pool B
Property at any time. The Parent and the Pool B Borrowers also
agree that they will reimburse the Lenders for and indemnify
and hold the Lenders harmless from any and all costs and
expenses (including reasonable attorneys' fees) and for all
civil judgments or penalties incurred, entered, assessed, or
levied against any of the Lenders as a result of a Pool B
Borrower's use of Materials of Environmental Concern at any
Pool B Property or as a result of any release of any Materials
of Environmental Concern on the ground or into the water or
air by a Pool B Borrower from or upon any Pool B Property.
Such reimbursement or indemnification shall include but not be
limited to any and all judgments or penalties to recover the
costs of cleanup of any such release by a Pool B Borrower from
or upon any Pool B Property and all reasonable expenses
incurred by the Lenders as a result of such a civil action,
including but not limited to reasonable attorneys' fees. The
Parent's and the Pool B Borrowers' obligations under this
Section 7.17(ii) shall survive the repayment of the Loans and
any deed in lieu of foreclosure or any foreclosure of a
Mortgage on a Pool B Property.
(iii) The Parent and the Pool C Borrowers agree that
they will reimburse the Lenders for and hereby hold the
Lenders harmless from all fines or penalties made or levied
against any of the Lenders by any Governmental Authority as a
result of or in connection with (i) the use of Materials of
Environmental Concern at any Pool C Property, (ii) the use of
Materials of Environmental concern at the Facilities thereon,
or (iii) the use, generation, storage, transportation,
discharge, release or handling of any Materials of
Environmental Concern at any Pool C Property, or as a result
of any release of any Materials of Environmental Concern onto
the ground or into the water or air from or upon any Pool C
Property at any time. The Parent and the Pool C Borrowers also
agree that they will reimburse the Lenders for and indemnify
and hold the Lenders harmless from any and all costs and
expenses (including reasonable attorneys' fees) and for all
civil judgments or penalties incurred, entered, assessed, or
levied against any of the Lenders as a result of a Pool C
Borrower's use of Materials of Environmental Concern at any
Pool C Property or as a result of any release of any Materials
of Environmental Concern on the ground or into the water or
air by a Pool C Borrower from or upon any Pool C Property.
Such reimbursement or indemnification shall include but not be
limited to any and all judgments or penalties to recover the
costs of cleanup of any such release by a Pool C Borrower from
or upon any Pool C Property and all reasonable expenses
incurred by the Lenders as a result of such a civil action,
including but not limited to reasonable attorneys' fees. The
Parent's and the Pool C Borrowers' obligations under this
Section 7.17(iii) shall survive the repayment
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of the Loans and any deed in lieu of foreclosure or any
foreclosure of a Mortgage on a Pool C Property.
7.18 APPRAISALS.
The Pool B Borrowers shall provide to the Administrative Agent, within
60 days of the commencement of construction at each Pool B Property identified
on Schedule 2.1(a)(ii), an appraisal (in form and substance satisfactory to the
Administrative Agent) with respect to each Facility located on such Pool B
Property from a qualified appraiser satisfactory to the Administrative Agent.
SECTION 8
NEGATIVE COVENANTS
Each Operative Party hereby covenants and agrees with respect to itself
and its Subsidiaries that, so long as this Credit Agreement is in effect or any
amounts payable hereunder or under any other Credit Document shall remain
outstanding (other than contingent indemnification obligations which survive),
and until all of the Commitments hereunder shall have terminated:
8.1 INDEBTEDNESS.
No Operative Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the
other Credit Documents;
(b) obligations of the Operative Parties in respect of Hedging
Agreements entered into in order to manage existing or anticipated
interest rate or exchange rate risks and not for speculative purposes;
(c) purchase money Indebtedness (including obligations in
respect of Capital Leases) (including refinancings thereof) hereafter
incurred by any Borrower to finance the purchase of fixed assets
provided that (i) the total of all such Indebtedness for such Borrower
shall not exceed an aggregate principal amount of $150,000 at any one
time outstanding; (ii) such Indebtedness when incurred shall not exceed
the purchase price of the asset(s) financed; and (iii) no such
Indebtedness shall be refinanced for a principal amount in excess of
the principal balance outstanding thereon at the time of such
refinancing; and
(d) additional unsecured subordinated Indebtedness of any
Borrower, provided that (i) such Indebtedness is owing only to HCR,
Alterra or the Parent, (ii) such Indebtedness shall be subordinated to
the Loans pursuant to subordination terms (including, without
limitation, (x) assignment of bankruptcy voting rights and (y)
prohibition on acceleration until the Loans shall have been
accelerated) satisfactory in form and substance
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to the Administrative Agent, (iii) such Indebtedness (x) with respect
to any one Borrower (other than Clare Bridge Jefferson) (together with
any such Indebtedness of such Borrower referred to in subsection (c)
and (e) hereof) shall not exceed an aggregate principal amount of
$550,000 at any one time outstanding and (y) with respect to Clare
Bridge Jefferson (together with any such Indebtedness of Clare Bridge
Jefferson referred to in subsection (c) and (e) hereof) shall not
exceed an aggregate principal amount of $600,000 at any time
outstanding, (iv) the aggregate subordinated Indebtedness of the
Borrowers taken as a whole referred to in subsections (d) and (e)
hereof shall not exceed $5,000,000 in the aggregate principal amount
outstanding at any time, (v) no part of the principal amount of such
Indebtedness shall have a maturity date earlier than one month
following the Maturity Date, (vi) such Indebtedness shall not be
amended or modified without the prior written consent of the
Administrative Agent, (vii) such Indebtedness shall not be assigned or
otherwise transferred, in whole or in part, or encumbered in any manner
whatsoever by HCR, Alterra or the Parent, as applicable, and (VII) the
interest rate on any such Indebtedness shall not exceed the Prime Rate
(as published in The Wall Street Journal) plus 2% per annum.
(e) the unsecured subordinated Indebtedness of the Initial
Pool A Borrowers (other than Clare Bridge Parma and Clare Bridge
Westchase) in the amounts identified on Schedule 8.11(e) owing to
Health Care Retirement Corporation, provided that (i) such Indebtedness
shall be subordinated to the Loans pursuant to subordination terms
(including, without limitation, (x) assignment of bankruptcy voting
rights and (y) prohibition on acceleration until the Loans shall have
been accelerated) satisfactory in form and substance to the
Administrative Agent, (ii) such Indebtedness with respect to any such
Initial Pool A Borrower (other than Clare Bridge Jefferson) (together
with any such Indebtedness of such Initial Pool A Borrower referred to
in subsections (c) and (d) above) shall not exceed an aggregate
principal amount of $550,000 at any one time outstanding, (iii) such
Indebtedness with respect to Clare Bridge Jefferson (together with any
such Indebtedness of Clare Bridge Jefferson referred to in subsections
(c) and (d) above) shall not exceed $600,000 at any one time
outstanding, (iv) the aggregate subordinated Indebtedness of the
Borrowers taken as a whole referred to in subsections (d) and (e)
hereof shall not exceed $5,000,000 in the aggregate principal amount
outstanding at any time outstanding, (v) no part of the principal
amount of such Indebtedness shall have a maturity date earlier than one
month following the Maturity Date, (vi) such Indebtedness shall not be
amended or modified without the prior written consent of the
Administrative Agent, (vii) such Indebtedness shall not be assigned or
otherwise transferred, in whole or in part, or encumbered in any manner
whatsoever by Health Care Retirement Corporation and (viii) the
interest rate on any such Indebtedness shall not exceed the Prime Rate
(as published in the Wall Street Journal) plus 2% per annum.
8.2 LIENS.
No Operative Party will, nor will it permit any of its Subsidiaries to,
contract, create, incur, assume or permit to exist any Lien with respect to any
of its Property, whether now owned or after acquired, except for Permitted
Liens.
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8.3 NATURE OF BUSINESS.
No Borrower will engage in any business other than (a) the acquisition
(as applicable) construction, development or refinancing and operation of its
respective Facility and (b) entering into and performance of the Credit
Documents to which it is a party. The Parent shall not engage in any business,
activity or operation other than (a) the ownership of Capital Stock permitted by
Section 8.6 and (b) entering into and performance of the Credit Documents to
which it is a party.
8.4 CONSOLIDATION, MERGER, DISSOLUTION, ETC.
Except as provided in Section 8.5 below, no Operative Party will, nor
will it permit any of its Subsidiaries to, enter into any transaction of merger
or consolidation or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution). Furthermore, none of the Borrowers shall form any
Subsidiaries. The Parent shall also not form any Subsidiaries, and the Parent
shall not own any assets other than (i) ten percent (10%) of the Capital Stock
of each Pool A Borrower, (ii) ten percent (10%) of the Capital Stock of each
Pool B Borrower, (iii) ten percent of the Capital Stock of each Pool C Borrower,
and (iv) ten percent (10%) of the Capital Stock of any Person which shall become
a Borrower in accordance with the terms of Section 2.3 within 30 days of the
initial investment by the Parent in such Person.
8.5 ASSET DISPOSITIONS.
No Operative Party will, nor will it permit any of its Subsidiaries to,
make any Asset Disposition (including, without limitation, any Sale and
Leaseback Transaction) other than (i) the sale of assets (other than any
Facility) in the ordinary course of business for fair consideration (ii) the
sale or disposition of assets (other than any Facility) no longer used or useful
in the conduct of such Person's business and (iii) the sale of non-material
assets (other than any Facility) for fair consideration.
Notwithstanding the foregoing paragraph, a Borrower may sell a Facility
and obtain the release of the Administrative Agent's security interest, for the
benefit of the Lenders, with respect to such Facility provided (i) no Default
(other than a Default which the applicable Borrower is attempting to remedy by
removing such Facility as Collateral in accordance with the terms of this
Section 8.5) or Event of Default exists before or after giving effect to any
such sale, (ii) after giving effect to any such sale on a pro forma basis, as if
such sale had occurred on the first day of the four fiscal quarter period most
recently ending, the Borrowers are in compliance with Section 7.11 (such
compliance to be evidenced by the delivery to the Administrative Agent prior to
consummating such sale of a certificate of each of the chief financial officers
of the Designated Borrowers demonstrating compliance with the financial
covenants contained in Section 7.11), (iii) such Facility is sold pursuant to
the terms and conditions of an arms-length contract for fair market value, (iv)
to the extent such Borrower has any Revolving Loans outstanding hereunder, the
proceeds received from such disposition of such Facility are applied to prepay
such Revolving Loans borrowed by such Borrower in full in accordance with
Section 3.3(b)(ii) and (v) the Borrowing Base shall continue to exceed the
amount of Revolving Loans outstanding after giving effect to any such sale (to
be evidenced by the delivery to the Administrative Agent
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prior to consummating such sale of a Borrowing Base Certificate certified by
each of the chief financial officers of the Designated Borrowers to be true
and correct).
Notwithstanding the terms of Section 8.4 and Section 8.5 to the
contrary, the Parent and the limited partners of a Borrower may (i) sell the
Capital Stock of such Borrower or (ii) merge such Borrower with and into a
successor entity and obtain the release of the Administrative Agent's security
interest, for the benefit of the Lenders, with respect to the Facility owned by
such Borrower provided (A) no Default (other than a Default which the Parent and
the limited partners of the applicable Borrower are attempting to remedy by
removing the Facility of such Borrower as Collateral in accordance with the
terms of this Section 8.5) or Event of Default exists before or after giving
effect to any such disposition of Capital Stock or merger, as applicable, (B)
after giving effect to any such disposition of Capital Stock or merger, as
applicable, on a pro forma basis, as if such merger or disposition had occurred
on the first day of the four fiscal quarter period most recently ending the
Borrowers are in compliance with Section 7.11 (such compliance to be evidenced
by the delivery to the Administrative Agent prior to consummating such
disposition or merger, as applicable, of a certificate of each of the chief
financial officers of the Designated Borrowers demonstrating compliance with the
financial covenants contained in Section 7.11), (C) such Capital Stock is sold
or such merger is consummated, as applicable, pursuant to the terms and
conditions of an arms-length contract for fair market value, (D) to the extent
such Borrower has any Revolving Loans outstanding hereunder, the proceeds
received from such disposition of Capital Stock or merger, as applicable, are
applied to prepay such Revolving Loans borrowed by such Borrower in accordance
with Section 3.3(b)(ii) and (E) after giving effect to any such disposition of
Capital Stock or merger, as applicable, the Borrowing Base shall continue to
exceed the amount of Revolving Loans outstanding (to be evidenced by the
delivery to the Administrative Agent prior to consummating such disposition or
merger, as applicable, of a Borrowing Base Certificate certified by each of the
chief financial officers of the Designated Borrowers to be true and correct).
Upon the sale of assets permitted by this Section 8.5, the
Administrative Agent shall deliver to the applicable Borrower (and the Lenders
hereby authorize the Administrative Agent to), upon such Borrower's request and
at such Borrower's expense, such documentation as is reasonably necessary to
evidence the release of the Administrative Agent's security interest in such
assets.
8.6 INVESTMENTS.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, make any Investments, except for Permitted Investments.
8.7 RESTRICTED PAYMENTS.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, directly or indirectly, declare, order, make or set apart any
sum for or pay any Restricted Payment, except (a) to make dividends payable
solely in the same class of Capital Stock of such Person, (b) a Borrower may
make cash dividends or other cash distributions payable to any shareholder of
such Borrower with proceeds received by such Borrower pursuant to a sale of a
Facility in accordance with the
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terms of Section 8.5 so long as the Revolving Loans borrowed hereunder with
respect to such Facility have been repaid in full in accordance with the terms
of Section 3.3(b)(ii), (c) a Borrower may make cash dividends or other cash
distributions payable to its shareholders to the extent such cash dividends or
cash distributions are required pursuant to the terms of such Borrower's
organizational documents and (d) the Parent may make cash dividends or cash
distributions payable to HCR and Alterra.
8.8 PREPAYMENTS OF INDEBTEDNESS, ETC.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, (a) after the issuance thereof, amend or modify (or permit the
amendment or modification of) any of the terms of any Indebtedness (other than
trade debt incurred in the ordinary course of business) if such amendment or
modification would add or change any terms in a manner adverse to the obligor of
such Indebtedness, or shorten the final maturity or average life to maturity or
require any payment to be made sooner than originally scheduled or increase the
interest rate applicable thereto or change any subordination provision thereof,
or (b) make (or give any notice with respect thereto) any voluntary or optional
payment or prepayment or redemption or acquisition for value of (including
without limitation, by way of depositing money or securities with the trustee
with respect thereto before due for the purpose of paying when due), refund,
refinance or exchange of any other Indebtedness.
8.9 TRANSACTIONS WITH AFFILIATES.
Except for the Management Agreements and the Development Agreements,
the Operative Parties will not, nor will they permit any of their Subsidiaries
to, enter into or permit to exist any transaction or series of transactions with
any officer, director, shareholder, Subsidiary or Affiliate of such Person other
than (i) normal compensation and reimbursement of expenses of officers and
directors and (ii) except as otherwise specifically limited in this Credit
Agreement, other transactions which are entered into in the ordinary course of
such Person's business on terms and conditions substantially as favorable to
such Person as would be obtainable by it in a comparable arms-length transaction
with a Person other than an officer, director, shareholder, Subsidiary or
Affiliate.
8.10 FISCAL YEAR; ORGANIZATIONAL DOCUMENTS.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, (a) change its fiscal year without the prior written consent of
the Required Lenders or (b) amend, modify or change its articles of
incorporation (or corporate charter or other similar organizational document) or
bylaws (or other similar document) or partnership agreement (or other similar
document) in any manner that would reasonably be likely to adversely affect the
Lenders.
8.11 LIMITATION ON RESTRICTED ACTIONS.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to
exist or become effective any encumbrance or restriction on the ability of any
such Person to (a) pay dividends or make any other distributions
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to any Credit Party on its Capital Stock or with respect to any other interest
or participation in, or measured by, its profits, (b) pay any Indebtedness or
other obligation owed to any Operative Party, (c) make loans or advances to any
Operative Party, (d) sell, lease or transfer any of its properties or assets to
any Operative Party, or (e) act as a Guarantor and pledge its assets pursuant to
the Credit Documents or any renewals, refinancings, exchanges, refundings or
extension thereof, except (in respect of any of the matters referred to in
clauses (a)-(d) above) for such encumbrances or restrictions existing under or
by reason of (i) this Credit Agreement and the other Credit Documents or (ii)
applicable law.
8.12 SALE LEASEBACKS.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, directly or indirectly, become or remain liable as lessee or as
guarantor or other surety with respect to any lease, whether an Operating Lease
or a Capital Lease, of any Property (whether real, personal or mixed), whether
now owned or hereafter acquired, (a) which such Operative Party or its
Subsidiary has sold or transferred or is to sell or transfer to any Person or
(b) which such Operative Party or its Subsidiary intends to use for
substantially the same purpose as any other Property which has been sold or is
to be sold or transferred by such Operative Party or its Subsidiary to another
Person in connection with such lease.
8.13 NO FURTHER NEGATIVE PLEDGES.
The Operative Parties will not, nor will they permit any of their
Subsidiaries to, enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the creation or assumption of any Lien upon
its properties or assets, whether now owned or hereafter acquired, or requiring
the grant of any security for such obligation if security is given for some
other obligation, except pursuant to this Credit Agreement and the other Credit
Documents.
8.14 CONSTRUCTION.
The Operative Parties will not permit the commencement of construction
of any Eligible Project if the Eligible Project Loan Amount for such Eligible
Project exceeds the sum of (a) the amount of Revolving Loans available to be
drawn hereunder plus (b) the amount of equity investments made by the partners
of the applicable Borrower in the applicable Borrower which owns such Eligible
Project (the receipt of which shall be evidenced by certificate delivered to the
Administrative Agent by the applicable Borrower in a form satisfactory to the
Administrative Agent). Furthermore, the Operative Parties hereby agree that all
such equity investments referenced in the preceding sentence shall be expended
on the acquisition and/or construction, development and working capital needs or
refinancing of the applicable Eligible Project prior to using any proceeds from
the Revolving Loans for the acquisition and/or construction, development and
working capital needs or refinancing of such Eligible Project.
8.15 CHANGES TO PLANS AND SPECIFICATIONS.
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After (a) the review of a Development Budget by the Engineer and (b)
the recommendation by the Engineer to the Administrative Agent that such
Development Budget is acceptable, the Borrowers shall not permit any change
order (i) increasing the price of the improvements for an Eligible Project by
more than $50,000 for any one change order, (ii) increasing the price of the
improvements for an Eligible Project by more than 10% of the total hard cost
portion of the Development Budget or (iii) materially altering the scope of the
improvements without the prior written consent of the Administrative Agent
(which consent will not be unreasonably withheld).
8.16 TRANSFER OF PARTNERSHIP INTERESTS.
The Operative Parties (other than the Initial Pool A Borrowers) will
not permit their organizational documents (or any other contract or agreement)
to give any shareholder of any Operative Party any put rights with respect to
the Capital Stock of such Operative Party; provided, however, the Lenders hereby
acknowledge that the shareholders of the Initial Pool A Borrowers have the right
under the respective partnership agreements of the Initial Pool A Borrowers to
require Alterra to purchase 100% of the Capital Stock of any Initial Pool A
Borrower from such shareholders at any time from and after the first anniversary
of the date of the first resident occupancy at the applicable Eligible Project.
SECTION 9
EVENTS OF DEFAULT
9.1 EVENTS OF DEFAULT.
(a) An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(i) Payment. Any Operative Party shall
(A) default in the payment when due of any principal
of any of the Loans, or
(B) default, and such default shall continue for
three (3) or more Business Days, in the payment when due of
any interest on the Loans, or of any Fees or other amounts
owing hereunder, under any of the other Credit Documents or in
connection herewith or therewith; or
(ii) Representations. Any representation, warranty or
statement made or deemed to be made by HCR, Alterra or the Parent with
respect to itself only but not on behalf of any Borrower herein, in any
of the other Credit Documents, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto shall
prove untrue in any material respect on the date as of which it was
deemed to have been made; or
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(iii) Covenants.
(A) The Parent shall default in the due performance
or observance with respect to itself only but not with respect
to any Borrower of any term, covenant or agreement contained
in Sections 7.2, 7.4 or 8.1 through 8.15, inclusive;
(B) The Parent shall default in the due performance
or observance of any term, covenant or agreement contained in
Sections 7.1(a) or (b) and such default shall continue
unremedied for a period of at least 5 days after the earlier
of a responsible officer of the Parent becoming aware of such
default or notice thereof by the Administrative Agent;
(C) (I) Any Operative Party shall default in the due
performance or observance of any term, covenant or agreement
contained in Section 7.11(a) and such default shall continue
unremedied for a period of at least 60 days after the earlier
of a responsible officer of the Parent or a Borrower becoming
aware of such default or notice thereof by the Administrative
Agent (a default in the due performance or observance of
Section 7.11(a) may be remedied by the Borrowers by either
adding Eligible Projects and/or Stabilized Eligible Projects
as Collateral or removing as Collateral in accordance with the
terms of Section 8.5 those Facilities which fail to constitute
Eligible Projects or Stabilized Eligible Projects, as
applicable;
(II) Any Operative Party shall default in
the due performance or observance of any term, covenant or
agreement contained in Section 7.11(b) and such default shall
continue unremedied for a period of at least 60 days after the
earlier of a responsible officer of the Parent or a Borrower
becoming aware of such default or notice thereof by the
Administrative Agent (a default in the due performance or
observance of Section 7.11(b) may be remedied by the Borrowers
by removing as Collateral in accordance with the terms of
Section 8.5 those Facilities which fail to constitute
Stabilized Eligible Projects;
(D) The Parent shall default with respect to itself
only (but not with respect to any Borrower) in the due
performance or observance by it of any term, covenant or
agreement (other than those referred to in subsections (i),
(ii), (iii)(A), (iii)(B) or (iii)(C) of this Section 9.1(a))
contained in this Credit Agreement and such default shall
continue unremedied for a period of at least 30 days after the
earlier of a responsible officer of the Parent becoming aware
of such default or notice thereof by the Administrative Agent;
or
(iv) Other Credit Documents. (A) HCR, Alterra or the Parent
shall default with respect to itself but not with respect to any
Borrower in the due performance or observance of any term, covenant or
agreement in any of the other Credit Documents (subject to applicable
grace or cure periods, if any), or (B) any Credit Document shall fail
to be in full force and effect or to give the Administrative Agent
and/or the Lenders the Liens, rights,
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powers and privileges purported to be created thereby, or any Credit
Party shall so state in writing; or
(v) Guaranties. The guaranty given by any Guarantor
hereunder or any of the Guaranty Agreements or any provision thereof
shall cease to be in full force and effect, or any Guarantor hereunder
or any of the Guaranty Agreements or any Person acting by or on behalf
of such Guarantor shall deny or disaffirm such Guarantor's obligations
under such guaranty, or any Guarantor shall default in the due
performance or observance of any term, covenant or agreement on its
part to be performed or observed pursuant to any guaranty; or
(vi) Bankruptcy, etc. Any Bankruptcy Event shall occur with
respect to any Operative Party or any of its Subsidiaries; or
(vii) Defaults under Other Agreements.
(A) The Parent shall default in the performance or
observance (beyond the applicable grace period with respect
thereto, if any) of any material obligation or condition of
any material contract or lease; or
(B) With respect to any Indebtedness (other than
Indebtedness outstanding under this Credit Agreement) in
excess of $100,000 of the Parent (A) the Parent shall default
in any payment (beyond the applicable grace period with
respect thereto, if any) with respect to any such
Indebtedness, (B) the occurrence and continuance of a default
in the observance or performance relating to such Indebtedness
or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event or condition
shall occur or condition exist, the effect of which default or
other event or condition is to cause, or permit, the holder or
holders of such Indebtedness (or trustee or agent on behalf of
such holders) to cause (determined without regard to whether
any notice or lapse of time is required), any such
Indebtedness to become due prior to its stated maturity; or
(C) any such Indebtedness shall be declared due and payable,
or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof.
(viii) Judgments. One or more judgments or decrees shall be
entered against the Parent involving a liability of $250,000 or more in
the aggregate (to the extent not paid or fully covered by insurance
provided by a carrier who has acknowledged coverage and has the ability
to perform) and any such judgments or decrees shall not have been
vacated, discharged or stayed or bonded pending appeal within 30 days
from the entry thereof; or
(ix) ERISA. Any of the following events or conditions, if
such event or condition could reasonably be expected to have a Material
Adverse Effect: (i) any "accumulated funding deficiency," as such term
is defined in Section 302 of ERISA and Section 412 of the Code, whether
or not waived, shall exist with respect to any Plan, or any lien shall
arise on the assets of any Operative Party, any of its Subsidiaries or
any ERISA Affiliate in favor of the PBGC or a Plan; (ii) an ERISA Event
shall occur with respect to a Single Employer Plan, which is, in the
reasonable opinion of the Administrative Agent,
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likely to result in the termination of such Plan for purposes of Title
IV of ERISA; (iii) an ERISA Event shall occur with respect to a
Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Administrative Agent, likely to result in (A)
the termination of such Plan for purposes of Title IV of ERISA, or (B)
any Operative Party, any of its Subsidiaries or any ERISA Affiliate
incurring any liability in connection with a withdrawal from,
reorganization of (within the meaning of Section 4241 of ERISA), or
insolvency or (within the meaning of Section 4245 of ERISA) such Plan;
or (iv) any prohibited transaction (within the meaning of Section 406
of ERISA or Section 4975 of the Code) or breach of fiduciary
responsibility shall occur which may subject any Operative Party, any
of its Subsidiaries or any ERISA Affiliate to any liability under
Sections 406, 409, 502(i), or 502(l) or ERISA or Section 4975 of the
Code, or under any agreement or other instrument pursuant to which any
Operative Party, any of its Subsidiaries or any ERISA Affiliate has
agreed or is required to indemnify any person against any such
liability; or
(x) Ownership. There shall occur a Change of Control; or
(xi) HCR/Alterra Guaranties. (i) There shall occur a default
or event of default under the Alterra Guaranty Agreement or (ii) there
shall occur a default or event of default under the HCR Guaranty
Agreement; or
(xii) Management Agreements. (i) There shall occur a default
under any Management Agreement, or (ii) any Management Agreement shall
be terminated without the prior written consent of the Required
Lenders; or
(xiii) Pool A Event of Default. Any Pool A Event of Default
shall continue unremedied for a period of at least 60 days; or
(xiv) Pool B Event of Default. Any Pool B Event of Default
shall continue unremedied for a period of at least 60 days; or
(xv) Pool C Event of Default. Any Pool C Event of Default
shall continue unremedied for a period of at least 60 days.
(b) A Pool A Event of Default shall exist upon the occurrence of
any of the following specified events (each a "Pool A Event of Default"):
(i) Representations. Any representation, warranty or
statement made or deemed to be made by any Pool A Borrower herein, in
any of the other Credit Documents, or in any statement or certificate
delivered or required to be delivered pursuant hereto or thereto shall
prove untrue in any material respect on the date as of which it was
deemed to have been made; or
(ii) Covenants. Any Pool A Borrower shall
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(A) default in the due performance or observance with
respect to itself or any of its Subsidiaries of any term, covenant
or agreement contained in Sections 7.2, 7.4, 7.9, 7.13, 7.15 or
8.1 through 8.15, inclusive;
(B) default in the due performance or observance of any
term, covenant or agreement contained in Section 8.16 and such
default shall continue unremedied for a period of at least 60 days
after the earlier of a responsible officer of the Parent or a Pool
A Borrower becoming aware of such default or notice thereof by the
Administrative Agent, or
(C) default in the due performance or observance with
respect to itself or any of its Subsidiaries of any term, covenant
or agreement (other than those referred to in subsections (i),
(ii)(A) or (ii)(B) of this Section 9.1(b)) contained in this
Credit Agreement and such default shall continue unremedied for a
period of at least 30 days after the earlier of a responsible
officer of a Pool A Borrower becoming aware of such default or
notice thereof by the Administrative Agent; or
(iii) Other Credit Documents. Any Pool A Borrower shall
default in the due performance or observance of any term, covenant or
agreement in any of the other Credit Documents (subject to applicable
grace or cure periods, if any); or
(iv) Defaults under Other Agreements.
(A) Any Pool A Borrower shall default in the performance or
observance (beyond the applicable grace period with respect
thereto, if any) of any material obligation or condition of any
material contract or lease; or
(B) With respect to any Indebtedness (other than
Indebtedness outstanding under this Credit Agreement) in excess of
$100,000 of any Pool A Borrower (A) such Pool A Borrower shall
default in any payment (beyond the applicable grace period with
respect thereto, if any) with respect to any such Indebtedness,
(B) the occurrence and continuance of a default in the observance
or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto,
or any other event or condition shall occur or condition exist,
the effect of which default or other event or condition is to
cause, or permit, the holder or holders of such Indebtedness (or
trustee or agent on behalf of such holders) to cause (determined
without regard to whether any notice or lapse of time is
required), any such Indebtedness to become due prior to its stated
maturity; or (C) any such Indebtedness shall be declared due and
payable, or required to be prepaid other than by a regularly
scheduled required prepayment, prior to the stated maturity
thereof.
(v) Judgments. One or more judgments or decrees shall be
entered against any Pool A Borrower involving a liability of $100,000
or more in the aggregate (to the extent not paid or fully covered by
insurance provided by a carrier who has acknowledged coverage and has
the ability to perform) and any such judgments or decrees shall not
have
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been vacated, discharged or stayed or bonded pending appeal within 30
days from the entry thereof; or
(vi) Put Obligations. The shareholders of more than five (5) of
the fourteen (14) Initial Pool A Borrowers exercise their option to
require Alterra to purchase the Capital Stock of such Initial Pool A
Borrowers.
(c) A Pool B Event of Default shall exist upon the occurrence of any
of the following specified events (each a "Pool B Event of Default"):
(i) Representations. Any representation, warranty or statement
made or deemed to be made by any Pool B Borrower herein, in any of the
other Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue
in any material respect on the date as of which it was deemed to have
been made; or
(ii) Covenants. Any Pool B Borrower shall
(A) default in the due performance or observance with
respect to itself of any term, covenant or agreement contained in
Sections 7.2, 7.4, 7.9, 7.13, 7.15, 7.18 or 8.1 through 8.16,
inclusive;
(B) default in the due performance or observance with
respect to itself of any term, covenant or agreement (other than
those referred to in subsections (i) or (ii)(A) of this Section
9.1(c)) contained in this Credit Agreement and such default shall
continue unremedied for a period of at least 30 days after the
earlier of a responsible officer of the Parent or a Pool B
Borrower becoming aware of such default or notice thereof by the
Administrative Agent; or
(iii) Other Credit Documents. Any Pool B Borrower shall default
in the due performance or observance of any term, covenant or agreement
in any of the other Credit Documents (subject to applicable grace or
cure periods, if any); or
(iv) Defaults under Other Agreements.
(A) Any Pool B Borrower shall default in the performance or
observance (beyond the applicable grace period with respect
thereto, if any) of any material obligation or condition of any
material contract or lease; or
(B) With respect to any Indebtedness (other than
Indebtedness outstanding under this Credit Agreement) in excess of
$100,000 of any Pool B Borrower (A) such Pool B Borrower shall
default in any payment (beyond the applicable grace period with
respect thereto, if any) with respect to any such Indebtedness,
(B) the occurrence and continuance of a default in the observance
or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto,
or any other event or condition
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shall occur or condition exist, the effect of which default or
other event or condition is to cause, or permit, the holder or
holders of such Indebtedness (or trustee or agent on behalf of
such holders) to cause (determined without regard to whether any
notice or lapse of time is required), any such Indebtedness to
become due prior to its stated maturity; or (C) any such
Indebtedness shall be declared due and payable, or required to be
prepaid other than by a regularly scheduled required prepayment,
prior to the stated maturity thereof; or
(v) Judgments. One or more judgments or decrees shall be entered
against any Pool B Borrower involving a liability of $100,000 or more
in the aggregate (to the extent not paid or fully covered by insurance
provided by a carrier who has acknowledged coverage and has the ability
to perform) and any such judgments or decrees shall not have been
vacated, discharged or stayed or bonded pending appeal within 30 days
from the entry thereof.
(d) A Pool C Event of Default shall exist upon the occurrence of any
of the following specified events (each a "Pool C Event of Default"):
(i) Representations. Any representation, warranty or statement
made or deemed to be made by any Pool C Borrower herein, in any of the
other Credit Documents, or in any statement or certificate delivered or
required to be delivered pursuant hereto or thereto shall prove untrue
in any material respect on the date as of which it was deemed to have
been made; or
(ii) Covenants. Any Pool C Borrower shall
(A) default in the due performance or observance with
respect to itself or any of its Subsidiaries of any term, covenant
or agreement contained in Sections 7.2, 7.4, 7.9, 7.13, 7.15, 7.18
or 8.1 through 8.16, inclusive;
(B) default in the due performance or observance with
respect to itself or any of its Subsidiaries of any term, covenant
or agreement (other than those referred to in subsections (i) or
(ii)(A) of this Section 9.1(c)) contained in this Credit Agreement
and such default shall continue unremedied for a period of at
least 30 days after the earlier of a responsible officer of the
Parent or any Pool C Borrower becoming aware of such default or
notice thereof by the Administrative Agent; or
(iii) Other Credit Documents. Any Pool C Borrower shall default in
the due performance or observance of any term, covenant or agreement in
any of the other Credit Documents (subject to applicable grace or cure
periods, if any); or
(iv) Defaults under Other Agreements.
(A) Any Pool C Borrower shall default in the performance or
observance (beyond the applicable grace period with respect
thereto, if any) of any material obligation or condition of any
material contract or lease; or
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(B) With respect to any Indebtedness (other than
Indebtedness outstanding under this Credit Agreement) in excess of
$100,000 of any Pool C Borrower (A) such Pool C Borrower shall
default in any payment (beyond the applicable grace period with
respect thereto, if any) with respect to any such Indebtedness,
(B) the occurrence and continuance of a default in the observance
or performance relating to such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto,
or any other event or condition shall occur or condition exist,
the effect of which default or other event or condition is to
cause, or permit, the holder or holders of such Indebtedness (or
trustee or agent on behalf of such holders) to cause (determined
without regard to whether any notice or lapse of time is
required), any such Indebtedness to become due prior to its stated
maturity; or (C) any such Indebtedness shall be declared due and
payable, or required to be prepaid other than by a regularly
scheduled required prepayment, prior to the stated maturity
thereof.
(v) Judgments. One or more judgments or decrees shall be entered
against any Pool C Borrower involving a liability of $100,000 or more
in the aggregate (to the extent not paid or fully covered by insurance
provided by a carrier who has acknowledged coverage and has the ability
to perform) and any such judgments or decrees shall not have been
vacated, discharged or stayed or bonded pending appeal within 30 days
from the entry thereof.
9.2 ACCELERATION; REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the requisite Lenders
(pursuant to the voting requirements of Section 11.6) or cured to the
satisfaction of the requisite Lenders (pursuant to the voting procedures in
Section 11.6), the Administrative Agent shall, upon the request and direction of
the Required Lenders, by written notice to the Credit Parties, take any of the
following actions:
(a) Termination of Commitments. Declare the Commitments
terminated whereupon the Commitments shall be immediately terminated.
(b) Acceleration. Declare the unpaid principal of and any
accrued interest in respect of all Loans and any and all other
indebtedness or obligations of any and every kind owing by the Credit
Parties to the Administrative Agent and/or any of the Lenders hereunder
to be due whereupon the same shall be immediately due and payable
without presentment, demand, protest or other notice of any kind, all
of which are hereby waived by the Credit Parties.
(c) Enforcement of Rights. Enforce any and all rights and
interests created and existing under the Credit Documents including,
without limitation, all rights and remedies existing under the
Collateral Documents, all rights and remedies against a Guarantor and
all rights of set-off.
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Notwithstanding the foregoing, if an Event of Default specified in
Section 9.1(a)(vi) shall occur with respect to a Credit Party, then the
Commitments shall automatically terminate and all Loans, all accrued interest in
respect thereof, all accrued and unpaid Fees and other indebtedness or
obligations owing to the Administrative Agent and/or any of the Lenders
hereunder automatically shall immediately become due and payable without the
giving of any notice or other action by the Administrative Agent or the Lenders.
Notwithstanding anything contained herein to the contrary, the
Administrative Agent and the Lenders shall not take any of the actions
referenced above in subsections (a), (b) or (c) of this Section 9.2 following
the occurrence of a Pool A Event of Default, a Pool B Event of Default or a Pool
C Event of Default; provided, however, the Administrative Agent and the Lenders
shall be free to exercise any of the rights and remedies identified in this
Section 9.2 on account of any such Pool A Event of Default, Pool B Event of
Default or Pool C Event of Default (x) if any such Pool A Event of Default, Pool
B Event of Default or Pool C Event of Default is not remedied within 60 days of
the occurrence of such Pool A Event of Default, Pool B Event of Default or Pool
C Event of Default respectively or (y) upon the occurrence of an Event of
Default which has not been waived by the requisite Lenders (pursuant to the
voting requirements of Section 11.6).
SECTION 10
AGENCY PROVISIONS
10.1 APPOINTMENT, POWERS AND IMMUNITIES.
(a) Each Lender hereby irrevocably appoints and authorizes the
Administrative Agent to act as its agent under this Credit Agreement
and the other Credit Documents with such powers and discretion as are
specifically delegated to the Administrative Agent by the terms of this
Credit Agreement and the other Credit Documents, together with such
other powers as are reasonably incidental thereto. The Administrative
Agent (which term as used in this sentence and in Section 10.5 and the
first sentence of Section 10.6 hereof shall include its Affiliates and
its own and its Affiliates' officers, directors, employees, and
agents): (a) shall not have any duties or responsibilities except those
expressly set forth in this Credit Agreement and shall not be a trustee
or fiduciary for any Lender; (b) shall not be responsible to the
Lenders for any recital, statement, representation, or warranty
(whether written or oral) made in or in connection with any Credit
Document or any certificate or other document referred to or provided
for in, or received by any of them under, any Credit Document, or for
the value, validity, effectiveness, genuineness, enforceability, or
sufficiency of any Credit Document, or any other document referred to
or provided for therein or for any failure by any Credit Party or any
other Person to perform any of its obligations thereunder; (c) shall
not be responsible for or have any duty to ascertain, inquire into, or
verify the performance or observance of any covenants or agreements by
any Credit Party or the satisfaction of any condition or to inspect the
property (including the books and records) of any Credit Party or any
of its Subsidiaries or Affiliates; (d) shall not be required to
initiate or conduct any litigation or collection proceedings under any
Credit Document;
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and (e) shall not be responsible for any action taken or omitted to be
taken by it under or in connection with any Credit Document, except for
its own gross negligence or willful misconduct. The Administrative
Agent may employ agents and attorneys-in-fact and shall not be
responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care. The
Administrative Agent agrees that it will administer the Loans and the
Credit Documents in a manner consistent with that ordinarily employed
by the Administrative Agent in the administration of similar loans for
its own account.
(b) Each Lender hereby consents to and approves the terms of
the Alterra Guaranty Agreement and the HCR Guaranty Agreement. By
execution hereof, the Lenders authorize and direct the Administrative
Agent to enter into the Alterra Guaranty Agreement and the HCR Guaranty
Agreement on behalf of the Lenders.
10.2 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely upon
any certification, notice, instrument, writing, or other communication
(including, without limitation, any thereof by telephone or telecopy)
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 legal counsel (including counsel for any
Credit Party), independent accountants, and other experts selected by
the Administrative Agent. The Administrative Agent may deem and treat
the payee of any Note as the holder thereof for all purposes hereof
unless and until the Administrative Agent receives and accepts an
Assignment and Acceptance executed in accordance with Section 11.3(b)
hereof. As to any matters not expressly provided for by this Credit
Agreement, the Administrative Agent shall not be required to exercise
any discretion or take any action, but shall be required to act or to
refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of the Required Lenders,
and such instructions shall be binding on all of the Lenders; provided,
however, that the Administrative Agent shall not be required to take
any action that exposes the Administrative Agent to personal liability
or that is contrary to any Credit Document or applicable law or unless
it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it
by reason of taking any such action.
(b) For purposes of determining compliance with the conditions
specified in Section 5.1, each Lender that has executed this Credit
Agreement shall be deemed to have consented to, approved or accepted or
to be satisfied with, each document or other matter either sent by the
Administrative Agent to such Lender for consent, approval, acceptance
or satisfaction, or required thereunder to be consented to or approved
by or acceptable or satisfactory to the Lender.
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10.3 DEFAULTS.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of a Default or Event of Default unless the
Administrative Agent has received written notice from a Lender or a Credit Party
specifying such Default or Event of Default and stating that such notice is a
"Notice of Default". In the event that the Administrative Agent receives such a
notice of the occurrence of a Default or Event of Default, the Administrative
Agent shall give prompt notice thereof to the Lenders. The Administrative Agent
shall (subject to Section 10.2 hereof) take such action with respect to such
Default or Event of Default as shall reasonably be directed by the Required
Lenders, provided that, unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interest of the Lenders.
10.4 RIGHTS AS A LENDER.
With respect to its Commitment and the Loans made by it, Bank of
America (and any successor acting as Administrative Agent) in its capacity as a
Lender hereunder shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not acting as the
Administrative Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Agent in its individual
capacity. Bank of America (and any successor acting as Administrative Agent) and
its Affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in, provide services to, and
generally engage in any kind of lending, trust, or other business with any
Credit Party or any of its Subsidiaries or Affiliates as if it were not acting
as Administrative Agent, and Bank of America (and any successor acting as
Administrative Agent) and its Affiliates may accept fees and other consideration
from any Credit Party or any of its Subsidiaries or Affiliates for services in
connection with this Credit Agreement or otherwise without having to account for
the same to the Lenders. The Lenders acknowledge that, pursuant to such
activities, Bank of America or its Affiliates may receive information regarding
a Credit Party or any of its Affiliates (including information that may be
subject to confidentiality obligations in favor of a Credit Party or any of its
Subsidiaries) and acknowledge that the Administrative Agent shall be under no
obligation to provide such information to them.
10.5 INDEMNIFICATION.
The Lenders agree to indemnify the Administrative Agent and each of its
Affiliates (to the extent not reimbursed under Section 11.5 hereof, but without
limiting the obligations of the Credit Parties under such Section) ratably in
accordance with their respective Commitments, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including attorneys' fees), or disbursements of any kind and nature
whatsoever that may be imposed on, incurred by or asserted against the
Administrative Agent or any of its Affiliates (including by any Lender) in any
way relating to or arising out of any Credit Document or the transactions
contemplated thereby or any action taken or omitted by the Administrative Agent
or any of its Affiliates under any Credit Document (including any of the
foregoing arising from the negligence of the Administrative Agent or any of its
Affiliates); provided that no
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Lender shall be liable for any of the foregoing to the extent they arise from
the gross negligence or willful misconduct of the Person to be indemnified or
the breach by any such Person of its obligations under the Credit Documents.
Without limitation of the foregoing, each Lender agrees to reimburse the
Administrative Agent and each of its Affiliates promptly upon demand for its
ratable share of any costs or expenses payable by the Credit Parties under
Section 11.5, to the extent that the Administrative Agent or any of its
Affiliates is not promptly reimbursed for such costs and expenses by the Credit
Parties. The agreements in this Section 10.5 shall survive the repayment of the
Loans and other obligations under the Credit Documents and the termination of
the Commitments hereunder.
10.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender agrees that it has, independently and without reliance on
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Credit Parties and their Subsidiaries and decision to enter into this Credit
Agreement and that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
analysis and decisions in taking or not taking action under the Credit
Documents. Except for notices, reports, and other documents and information
expressly required to be furnished to the Lenders by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the affairs,
financial condition, or business of any Credit Party or any of its Subsidiaries
or Affiliates that may come into the possession of the Administrative Agent or
any of its Affiliates.
10.7 SUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign at any time by giving notice
thereof to the Lenders and the Credit Parties. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Administrative
Agent. If no successor Administrative Agent shall have been so appointed by the
Required Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Administrative Agent's giving of notice of resignation,
then the retiring Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent which shall be a commercial bank organized under
the laws of the United States of America having combined capital and surplus of
at least $100,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor, such successor shall thereupon succeed to and
become vested with all the rights, powers, discretion, privileges, and duties of
the retiring Administrative Agent, and the retiring Administrative Agent shall
be discharged from its duties and obligations hereunder. If no successor
Administrative Agent has accepted appointment as Administrative Agent within
thirty (30) days after the retiring Administrative Agent's giving notice of
resignation, the retiring Administrative Agent's resignation shall nevertheless
become effective and the Lenders shall perform all duties of the Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor Administrative Agent as provided for above. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Section 10 shall
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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.
SECTION 11
MISCELLANEOUS
11.1 NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid to a reputable national overnight air courier
service, or (d) the third Business Day following the day on which the same is
sent by certified or registered mail, postage prepaid, in each case to the
respective parties at the address, in the case of the Credit Parties and the
Administrative Agent, set forth below, and, in the case of the Lenders, set
forth on Schedule 2.1(a)(i), or at such other address as such party may specify
by written notice to the other parties hereto:
if to HCR:
Manor Care, Inc.
One Seagate
Toledo, Ohio 43604-2616
Attn: Geoffrey Meyers
Telephone: (419) 252-5549
Telecopy: (419) 252-5564
if to Alterra:
Alterra Healthcare Corporation
450 North Sunnyslope Road, Suite 300
Brookfield, Wisconsin 53005
Attn: Mark Ohlendorf
Telephone: (414) 641-7432
Telecopy: (414) 789-6677
if to the Parent:
HCR/Alterra Development, LLC
One Seagate
Toledo, Ohio 43604-2616
Attn: Douglas Haag
Telephone: (419) 252-5710
Telecopy: (419) 252-5571
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with a copy to:
HCR/Alterra Development, LLC
450 North Sunnyslope Road, Suite 53005
Brookfield, Wisconsin 53005
Attn: Mark Ohlendorf
Telephone: (414) 641-7432
Telecopy: (414) 789-6677
if to any Borrower:
c/o HCR/Alterra Development, LLC
450 North Sunnyslope Road, Suite 53005
Brookfield, Wisconsin 53005
Attn: Mark Ohlendorf
Telephone: (414) 641-7432
Telecopy: (414) 789-6677
if to the Administrative Agent:
Bank of America, N. A.
Independence Center, 15th Floor
NC1-001-15-04
101 N. Tryon Street
Charlotte, North Carolina 28255
Attn: Agency Services
Telephone: (704) 386-9371
Telecopy: (704) 409-0023
with a copy to:
Bank of America, N. A.
700 Louisiana Street, 8th Floor
Houston, Texas 77002
Attn: Scott Singhoff
Telephone: (713) 247-6961
Telecopy: (713) 247-6719
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with a copy to:
Bank of America, N. A.
Agency Management #10831
CA5-701-12-09
1455 Market Street, 12th Floor
San Francisco, California 94103
Attn: Christine Cordi
Telephone: (415) 436-2790
Telecopy: (415) 436-3425
11.2 RIGHT OF SET-OFF; ADJUSTMENTS.
Upon the occurrence and during the continuance of any Event of Default,
each Lender (and each of its Affiliates) is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, to set off and apply
any and all deposits (general or special, time or demand, provisional or final)
at any time held and other indebtedness at any time owing by such Lender (or any
of its Affiliates) to or for the credit or the account of any Operative Party
against any and all of the obligations of such Person now or hereafter existing
under this Credit Agreement, under the Notes, under any other Credit Document or
otherwise, irrespective of whether such Lender shall have made any demand
hereunder or thereunder and although such obligations may be unmatured. Each
Lender agrees promptly to notify any affected Operative Party after any such
set-off and application made by such Lender; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application. The rights of each Lender under this Section 11.2 are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Lender may have.
11.3 BENEFIT OF AGREEMENT.
(a) This Credit Agreement shall be binding upon and inure to the
benefit of and be enforceable by the respective successors and assigns
of the parties hereto; provided that none of the Credit Parties may
assign or transfer any of its interests and obligations without prior
written consent of the Lenders; provided further that the rights of
each Lender to transfer, assign or grant participations in its rights
and/or obligations hereunder shall be limited as set forth in this
Section 11.3.
(b) Each Lender may assign to one or more Eligible Assignees all
or a portion of its rights and obligations under this Credit Agreement
(including, without limitation, all or a portion of its Loans, its
Notes, and its Commitment); provided, however, that
(i) each such assignment shall be to an Eligible Assignee;
(ii) except in the case of an assignment to another Lender
or an assignment of all of a Lender's rights and obligations
under this Credit Agreement, any such partial assignment shall be
in an amount at least equal to
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$10,000,000 (or, if less, the remaining amount of the Commitment
being assigned by such Lender) or an integral multiple of
$1,000,000 in excess thereof;
(iii) each such assignment by a Lender shall be of a
constant, and not varying, percentage of all of its rights and
obligations under this Credit Agreement and the Notes; and
(iv) the parties to such assignment shall execute and
deliver to (A) the Administrative Agent for its acceptance an
Assignment and Acceptance in the form of Exhibit 11.3(b) hereto
and (B) so long as no Event of Default shall have occurred and be
continuing at the time of such assignment, the Designated
Borrowers for their acceptance (such acceptance not to be
unreasonably withheld) an Assignment and Acceptance in the form
of Exhibit 11.3(b), together with any Note subject to such
assignment and a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and, to the
extent of such assignment, have the obligations, rights, and benefits
of a Lender hereunder and the assigning Lender shall, to the extent of
such assignment, relinquish its rights and be released from its
obligations under this Credit Agreement. Upon the consummation of any
assignment pursuant to this Section 11.3(b), the assignor, the
Administrative Agent and the Credit Parties shall make appropriate
arrangements so that, if required, new Notes are issued to the assignor
and the assignee. If the assignee is not a United States person under
Section 7701(a)(30) of the Code, it shall deliver to the Credit Parties
and the Administrative Agent certification as to exemption from
deduction or withholding of Taxes in accordance with Section 3.11.
(c) The Administrative Agent shall maintain at its address
referred to in Section 11.1 a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of
the names and addresses of the Lenders and the Commitment of, and
principal amount of the Loans owing to, each Lender from time to time
(the "Register"). The entries in the Register shall be conclusive and
binding for all purposes, absent manifest error, and the Credit
Parties, the Administrative Agent and the Lenders may treat each Person
whose name is recorded in the Register as a Lender hereunder for all
purposes of this Credit Agreement. The Register shall be available for
inspection by the Credit Parties or any Lender at any reasonable time
and from time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance executed by
the parties thereto, together with any Note subject to such assignment
and payment of the processing fee, the Administrative Agent shall, if
such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit 11.3(b) hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt notice thereof to the
parties thereto.
(e) Each Lender may sell participations to one or more Persons in
all or a portion of its rights, obligations or rights and obligations
under this Credit Agreement
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(including all or a portion of its Commitment or its Loans); provided,
however, that (i) such Lender's obligations under this Credit Agreement
shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations, (iii) the participant shall be entitled to the benefit of
the yield protection provisions contained in Sections 3.7 through 3.12,
inclusive, and the right of set-off contained in Section 11.2, and (iv)
the Credit Parties shall continue to deal solely and directly with such
Lender in connection with such Lender's rights and obligations under
this Credit Agreement, and such Lender shall retain the sole right to
enforce the obligations of the Credit Parties relating to the Credit
Party Obligations owing to such Lender and to approve any amendment,
modification, or waiver of any provision of this Credit Agreement
(other than amendments, modifications, or waivers decreasing the amount
of principal of or the rate at which interest is payable on such Loans
or Notes, extending any scheduled principal payment date or date fixed
for the payment of interest on such Loans or Notes, or extending its
Commitment).
(f) Notwithstanding any other provision set forth in this Credit
Agreement, any Lender may at any time assign and pledge all or any
portion of its Loans and its Notes to any Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating Circular
issued by such Federal Reserve Bank. No such assignment shall release
the assigning Lender from its obligations hereunder.
(g) Any Lender may furnish any information concerning the Credit
Parties in the possession of such Lender from time to time to assignees
and participants (including prospective assignees and participants),
subject, however, to the provisions of Section 11.14 hereof.
11.4 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Administrative Agent or any
Lender and any of the Credit Parties shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, power or privilege hereunder
or under any other Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Administrative Agent or any Lender
would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle the Credit Parties to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.
11.5 EXPENSES; INDEMNIFICATION.
(a) The Operative Parties jointly and severally agree to pay on demand
all costs and expenses of the Administrative Agent in connection with the
syndication, preparation, execution, delivery, administration, modification, and
amendment of this Credit Agreement, the other Credit Documents, and the other
documents to be delivered hereunder, including, without
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limitation, the reasonable fees and expenses of counsel for the Administrative
Agent with respect thereto and with respect to advising the Administrative Agent
as to its rights and responsibilities under the Credit Documents. The Operative
Parties further jointly and severally agree to pay on demand all costs and
expenses of the Administrative Agent and the Lenders, if any (including, without
limitation, reasonable attorneys' fees and expenses), in connection with the
enforcement (whether through negotiations, legal proceedings, or otherwise) and
attempted enforcement of the Credit Documents and the other documents to be
delivered hereunder and the preservation of any rights and remedies under this
Credit Agreement or any other Credit Document during the existence of an Event
of Default or after the acceleration of the Loans (including, without
limitation) in connection with any "workout" or restructuring regarding the
Loans, and including, without limitation, any insolvency proceeding or appellate
proceeding).
(b) The Operative Parties jointly and severally agree to indemnify and
hold harmless the Administrative Agent and each Lender and each of their
Affiliates and their respective officers, directors, employees, agents, and
advisors (each, an "Indemnified Party") from and against any and all claims,
damages, losses, liabilities, costs, and expenses (including, without
limitation, reasonable attorneys' fees) that may be incurred by or asserted or
awarded against any Indemnified Party, in each case arising out of or in
connection with or by reason of (including, without limitation, in connection
with any investigation, litigation, or proceeding or preparation of defense in
connection therewith) the Credit Documents, any of the transactions contemplated
herein or the actual or proposed use of the proceeds of the Loans (including to
the extent arising from the negligence of the Indemnified Party), except to the
extent such claim, damage, loss, liability, cost, or expense is found in a
final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.
In the case of an investigation, litigation or other proceeding to which the
indemnity in this Section 11.5 applies, such indemnity shall be effective
whether or not such investigation, litigation or proceeding is brought by any of
the Operative Parties, their respective directors, shareholders or creditors or
an Indemnified Party or any other Person or any Indemnified Party is otherwise a
party thereto and whether or not the transactions contemplated hereby are
consummated. The Operative Parties agree not to assert any claim against the
Administrative Agent, any Lender, any of their Affiliates, or any of their
respective directors, officers, employees, attorneys, agents, and advisers, on
any theory of liability, for special, indirect, consequential, or punitive
damages arising out of or otherwise relating to the Credit Documents, any of the
transactions contemplated herein or the actual or proposed use of the proceeds
of the Loans.
(c) Without prejudice to the survival of any other agreement of the
Operative Parties hereunder, the agreements and obligations of the Operative
Parties contained in this Section 11.5 shall survive the repayment of the Loans
and other obligations under the Credit Documents and the termination of the
Commitments hereunder.
11.6 AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment,
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change, waiver, discharge or termination is in writing entered into by, or
approved in writing by, the Required Lenders and the Borrowers, provided,
however, that:
(i) without the consent of each Lender affected thereby,
neither this Credit Agreement nor any other Credit Document may be
amended to
(a) extend the final maturity of any Loan or any portion
thereof,
(b) reduce the rate or extend the time of payment of
interest (other than as a result of waiving the applicability of
any post-default increase in interest rates) thereon or Fees
hereunder,
(c) reduce or waive the principal amount of any Loan or any
portion thereof,
(d) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver
of any Default or Event of Default or mandatory reduction in the
Commitments shall not constitute a change in the terms of any
Commitment of any Lender),
(e) release any Facility (provided that the Administrative
Agent may, without consent from any other Lender, release any
Collateral (including without limitation any Facility or Capital
Stock owned by the Parent in any Borrower) that is sold or
transferred by a Borrower or the Parent, as applicable, in
conformance with Section 8.4 and 8.5),
(f) release a Borrower or any Credit Party from its or their
obligations under the Credit Documents (provided that the
Administrative Agent may, without consent from any other Lender,
release a Borrower in conformance with Section 2.5),
(g) amend, modify or waive any provision of this Section
11.6 or Section 3.5(b), 3.13, 3.14, 3.15, 3.17, 9.1(a)(i), 11.2,
11.3, 11.5 or 11.9,
(h) reduce any percentage specified in, or otherwise modify,
the definition of Required Lenders, or
(i) amend (x) the requirement contained in Section 2.1 that
the sum of the aggregate principal amount of Revolving Loans used
to construct or refinance an Eligible Project not exceed such
Eligible Project's Eligible Project Loan Amount or (y) the
definition of Eligible Project Loan Amount contained in Section
1.1(a), or
(j) consent to the assignment or transfer by a Borrower or
all or substantially all of the other Credit Parties of any of
its or their rights and obligations under (or in respect of) the
Credit Documents except as permitted thereby; and
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(ii) without the consent of the Administrative Agent, no
provision of Section 10 may be amended.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender
is entitled to vote as such Lender sees fit on any bankruptcy
reorganization plan that affects the Loans, and each Lender
acknowledges that the provisions of Section 1126(c) of the Bankruptcy
Code supersedes the unanimous consent provisions set forth herein and
(y) the Required Lenders may consent to allow a Credit Party to use
cash collateral in the context of a bankruptcy or insolvency
proceeding.
11.7 COUNTERPARTS.
This Credit Agreement may be executed in any number of counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument. It shall not be necessary in
making proof of this Credit Agreement to produce or account for more than one
such counterpart for each of the parties hereto. Delivery by facsimile by any of
the parties hereto of an executed counterpart of this Credit Agreement shall be
as effective as an original executed counterpart hereof and shall be deemed a
representation that an original executed counterpart hereof will be delivered.
11.8 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Credit Agreement.
11.9 SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 3.11, 3.12, 10.5 or 11.5 shall survive the execution and delivery of
this Credit Agreement, the making of the Loans, the repayment of the Loans and
other obligations under the Credit Documents and the termination of the
Commitments hereunder and all representations and warranties made by the
Operative Parties herein shall survive delivery of the Notes and the making of
the Loans hereunder.
11.10 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS CREDIT AGREEMENT AND, UNLESS OTHERWISE EXPRESSLY
PROVIDED THEREIN, THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED
BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK. Any legal action or proceeding with respect to this
Credit Agreement or any other Credit Document may be brought in the
courts of the State of New York, or of the United States for the
Southern District of New York, and, by execution and delivery of this
Credit Agreement, each of the Operative Parties, the Administrative
Agent and the Lenders hereby irrevocably accepts for itself and in
respect of its property, generally and unconditionally, the
nonexclusive
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jurisdiction of such courts. Each of the Operative Parties, the
Administrative Agent and the Lenders further irrevocably consents to
the service of process out of any of the aforementioned courts in any
such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to it at the address set
out for notices pursuant to Section 11.1, such service to become
effective three (3) days after such mailing. Nothing herein shall
affect the right of the Administrative Agent or any Lender to (i) serve
process or to commence legal proceedings in any other manner permitted
by law or (ii) commence legal proceedings, exercise rights or otherwise
proceed against the Collateral in any other jurisdictions as permitted
by law or as deemed necessary or appropriate by the Administrative
Agent or any Lender. Nothing herein shall affect the rights of the
Operative Parties to serve process or to commence legal proceedings in
any other manner permitted by law.
(b) Each of the Operative Parties hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue of
any of the aforesaid actions or proceedings arising out of or in
connection with this Credit Agreement or any other Credit Document
brought in the courts referred to in subsection (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE AGENT, THE
LENDERS, EACH OF THE Operative PARTIES HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO THIS CREDIT AGREEMENT, ANY OF THE OTHER
CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY.
11.11 SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.12 ENTIRETY.
This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
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11.13 BINDING EFFECT; TERMINATION.
(a) This Credit Agreement shall become effective at such time
when all of the conditions set forth in Section 5.1 have been satisfied
or waived by the Lenders and it shall have been executed by each
Operative Party and the Administrative Agent, and the Administrative
Agent shall have received copies hereof (telefaxed or otherwise) which,
when taken together, bear the signatures of each Lender, and thereafter
this Credit Agreement shall be binding upon and inure to the benefit of
each Operative Party, the Administrative Agent and each Lender and
their respective successors and assigns.
(b) The term of this Credit Agreement shall be until no Loans or
any other amounts payable hereunder or under any of the other Credit
Documents shall remain outstanding, all of the Credit Party Obligations
(other than contingent indemnification obligations which survive) have
been irrevocably satisfied in full and all of the Commitments hereunder
shall have expired or been terminated.
11.14 CONFIDENTIALITY.
The Administrative Agent and each Lender (each, a "Lending Party")
agrees to keep confidential any information furnished or made available to it by
the Operative Parties pursuant to this Credit Agreement that is marked
confidential; provided that nothing herein shall prevent any Lending Party from
disclosing such information (a) to any other Lending Party or any Affiliate of
any Lending Party, or any officer, director, employee, agent, or advisor of any
Lending Party or Affiliate of any Lending Party, (b) to any other Person if
reasonably incidental to the administration of the credit facility provided
herein, (c) as required by any law, rule, or regulation, (d) upon the order of
any court or administrative agency, (e) upon the request or demand of any
regulatory agency or authority, (f) that is or becomes available to the public
or that is or becomes available to any Lending Party other than as a result of a
disclosure by any Lending Party prohibited by this Credit Agreement, (g) to the
extent necessary, in connection with any litigation to which such Lending Party
or any of its Affiliates may be a party, (h) to the extent necessary in
connection with the exercise of any remedy under this Credit Agreement or any
other Credit Document, and (i) subject to provisions substantially similar to
those contained in this Section 11.14, to any actual or proposed participant or
assignee.
11.15 CONFLICT.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Credit Agreement shall control.
11.16 SOURCE OF FUNDS.
Each of the Lenders hereby represents and warrants to the Borrowers
that at least one of the following statements is an accurate representation as
to the source of funds to be used by such Lender in connection with the
financing hereunder:
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(a) no part of such funds constitutes assets allocated to any
separate account maintained by such Lender in which any employee
benefit plan (or its related trust) has any interest;
(b) to the extent that any part of such funds constitutes assets
allocated to any separate account maintained by such Lender, such
Lender has disclosed to the Borrowers the name of each employee benefit
plan whose assets in such account exceed 10% of the total assets of
such account as of the date of such purchase (and, for purposes of this
subsection (b), all employee benefit plans maintained by the same
employer or employee organization are deemed to be a single plan);
(c) to the extent that any part of such funds constitutes assets
of an insurance company's general account, such insurance company has
complied with all of the requirements of the regulations issued under
Section 401(c)(1)(A) of ERISA; or
(d) such funds constitute assets of one or more specific benefit
plans which such Lender has identified in writing to the Borrowers.
As used in this Section 11.15, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
11.17 RELEASE OF LIENS.
The Lenders hereby agree that the Administrative Agent shall
(upon the request and at the expense of Clare Bridge Parma) take such
action as is necessary to release the Administrative Agent's security
interest in the Parma Vacant Land; provided, (i) no Default or Event of
Default shall have occurred and be continuing, (ii) Clare Bridge Parma
shall first cause the Parma Vacant Land to be subdivided in accordance
with applicable law from the land on which the Facility in Parma, Ohio
is located and such Parma Vacant Land shall be a separate parcel of
land for all building, subdivision, zoning and taxing purposes, (iii)
the land on which the Facility in Parma, Ohio is located is a platted
and subdivided parcel upon which the Administrative Agent may maintain
a legally enforceable first priority perfected lien, (iv) the land on
which the Facility in Parma, Ohio is located shall continue to remain
subject to the Administrative Agent's security interest pursuant to the
applicable Mortgage and shall be of a sufficient size and nature in the
reasonable opinion of the Administrative Agent for the operation of the
Facility in Parma, Ohio, (v) to the extent reasonably required, an
appropriate reciprocal easement agreement or other agreements shall be
executed and recorded to ensure the integrated use and operation of the
Facility in Parma, Ohio and the Parma Vacant Land, (vi) title to the
Parma Vacant Land shall have been or simultaneously shall be conveyed
to a person or entity other than Clare Bridge Parma, (vii) all
agreements and instruments to be delivered to Administrative Agent in
connection with the release of the Parma Vacant Land shall be in form
and substance reasonably satisfactory to Administrative Agent and
(viii) Clare Bridge Parma shall pay all costs reasonably incurred by
Administrative Agent (including, but not limited to, reasonable
attorneys' fees and disbursements, title search costs and endorsement
premiums) in connection with the review, execution and delivery of the
release of the Parma Vacant Land.
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[Signature Page to Follow]
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Credit Agreement to be duly executed and delivered as of
the date first above written.
BORROWERS: CLARE BRIDGE OF AKRON L.P.,
a Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
CLARE BRIDGE OF ARLINGTON L.P.,
a Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
122
CLARE BRIDGE OF BAINBRIDGE L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
CLARE BRIDGE OF BINGHAM FARMS L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
123
CLARE BRIDGE OF CARROLLWOOD L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
CLARE BRIDGE OF FT. MYERS L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
124
CLARE BRIDGE OF HOUSTON L.P., a Delaware
limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
CLARE BRIDGE OF JEFFERSON TOWNSHIP L.P.,
a Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
125
CLARE BRIDGE OF LIVONIA L.P., a Delaware
limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
CLARE BRIDGE OF PARMA L.P., a Delaware
limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
126
CLARE BRIDGE OF RICHARDSON L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
CLARE BRIDGE OF TUSCAWILLA L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
127
CLARE BRIDGE OF WESTCHASE L.P., a
Delaware limited partnership
By: HCR/Alterra Development, LLC,
a Delaware limited liability company, its
sole general partner
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
128
CREDIT AGREEMENT
GUARANTORS: HCR/ALTERRA DEVELOPMENT, LLC,
a Delaware limited liability company
By: /s/Mark W. Ohlendorf
-------------------------------
Name: Mark W. Ohlendorf
-----------------------------
Title: Co-Vice President
----------------------------
By: /s/Douglas G. Haas
-------------------------------
Name: Douglas G. Haas
-----------------------------
Title: Co-Vice President
----------------------------
129
LENDERS: BANK OF AMERICA, N. A.,
individually in its capacity as a
Lender and in its capacity as
Administrative Agent
By: /s/J. Gregory Seibly
-------------------------------
Name: J. Gregory Seibly
-----------------------------
Title: Managing Director
----------------------------
130
THE CHASE MANHATTAN BANK
By: /s/Dawn Lee Lum
-------------------------------
Name: Dawn Lee Lum
-----------------------------
Title: Vice President
----------------------------
131
DEUTSCHE BANK AG NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/Susan L. Pearson
-------------------------------
Name: Susan L. Pearson
-----------------------------
Title: Director
----------------------------
By: /s/Joel Makowsky
-------------------------------
Name: Joe Makowsky
-----------------------------
Title: Vice President
-----------------------------
132
BANK UNITED, F.S.B.
By: /s/Casey Moore
-------------------------------
Name: Casey Moore
-----------------------------
Title: Vice President
----------------------------
133
COMERICA BANK
By: /s/Colleen M. Murphy
-------------------------------
Name: Colleen M. Murphy
-----------------------------
Title: Vice President
----------------------------
134
NATIONAL CITY BANK
By: /s/Janice E. Focke
-------------------------------
Name: Janice E. Focke
-----------------------------
Title: Vice President
----------------------------
135
THE BANK OF NEW YORK
By: /s/Edward J. Dougherty III
----------------------------------------
Name: Edward J. Dougherty III
----------------------------------------
Title: Vice President, U.S. Commerical Banking
----------------------------------------
136
THE HUNTINGTON NATIONAL BANK
By: /s/Daniel E. Crane
---------------------------------
Name: Daniel E. Crane
-------------------------------
Title: Vice President
------------------------------
137
BANK OF MONTREAL
By: /s/Heather L. Turf
---------------------------------
Name: Heather L. Turf
-------------------------------
Title: Director
------------------------------