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EXHIBIT 10.12
REVOLVING CREDIT AGREEMENT
by and among
MEDITRUST AND THE PARTNERSHIPS, CORPORATIONS AND
OTHER ENTITIES REFERENCED HEREIN
as the Company
and
THE LENDING INSTITUTIONS REFERENCED HEREIN
as the Banks
and
FLEET BANK, NATIONAL ASSOCIATION
and FIRST UNION NATIONAL BANK OF NORTH CAROLINA
as the Agents
May 31, 1994
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TABLE OF CONTENTS
PAGE
[TO BE ADDED]
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TABLE OF EXHIBITS
Exhibit A Notice of Borrowing
Exhibit B Form of Revolving Credit Note
Exhibit C Form of Guaranty
Exhibit D Notice of Continuation or Conversion
Exhibit E Form of Opinion of Counsel to the Company
Exhibit F Form of Borrowing Report
Exhibit G Form of Meditrust Facility Summary
Exhibit H Form of Administrative Questionnaire
Exhibit I Form of Assignment and Acceptance
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TABLE OF SCHEDULES
Schedule 1.22. Commitments and Commitment Percentages
Schedule 3.3. Restrictions
Schedule 3.8. Material Adverse Changes
Schedule 3.12. Liens
Schedule 3.18. Existing Indebtedness
Schedule 3.19. Litigation
Schedule 3.20. Guarantees
Schedule 3.22. Environmental Matters
Schedule 7.1. Indebtedness
Schedule 7.2. Guarantees
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REVOLVING CREDIT AGREEMENT
This REVOLVING CREDIT AGREEMENT (the "Agreement") is made as of this 31st
day of May, 1994 by and among MEDITRUST, a Massachusetts business trust, with
its chief executive office located at 197 First Avenue, Needham, Massachusetts
02194 ("Meditrust"), the corporations, partnerships and other entities listed on
the signature pages hereto and such other corporations, partnerships and
entities that may become parties to this Agreement from time to time in
accordance with the provisions hereof (Meditrust and such corporations,
partnerships and entities being referred to individually and collectively as the
"Company"); the lending institutions listed on the signature pages hereto and
such other lending institutions that may become parties to this Agreement from
time to time in accordance with the provisions hereof (such lending institutions
being referred to individually as a "Bank" and collectively as the "Banks");
FLEET BANK, NATIONAL ASSOCIATION, a national banking association, with its head
office located at One Constitution Plaza, Hartford, Connecticut 06115-1600
("Fleet") and FIRST UNION NATIONAL BANK OF NORTH CAROLINA, a national banking
association, with its head office located at One First Union Center, Charlotte,
North Carolina 28288-0735 ("FUB") as agents for the Banks (in such capacity,
individually the "Agent" and collectively, the "Agents").
Section 1. DEFINITIONS
All capitalized terms used in this Agreement, the Notes or the Other
Documents, or in any certificate, report or other document, agreement or
instrument executed or delivered pursuant hereto and thereto (unless otherwise
indicated therein) shall have the meanings ascribed to such terms below.
Section 1.1. "Administrative Agent" means, initially, Fleet and shall
include any successor administrative agent for the Banks which may be appointed
at any time in the future under the provisions of this Agreement.
Section 1.2. "Administrative Questionnaire" has the meaning in Section
9.16. hereof.
Section 1.3. "Affected Loans" has the meaning ascribed to it in Section
2.3.4. hereof.
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Section 1.4. "Affiliate" means any Person (i) which directly or indirectly
controls, or is controlled by, or is under common control with, another Person
or any Subsidiary of such other Person; (ii) which directly or indirectly
beneficially owns or holds ten percent (10%) or more of any class of voting
stock of such other Person or any Subsidiary of such other Person; or (iii) ten
percent (10%) or more of the voting stock of which is directly or indirectly
beneficially owned or held by such other Person or any Subsidiary of such other
Person. The term "control" (and its correlative meanings "controlled by" and
"under common control with") as used in this Section 1.4. means the possession,
directly or indirectly, of the power to direct, or cause the direction of, the
management and policies of a Person, whether through ownership of voting stock,
by contract or otherwise.
Section 1.5. "Agent or Agents" has the meaning ascribed to it in the
Preamble hereof and shall include any successor agent or agents for the Banks
which may be appointed at any time in the future under the terms of this
Agreement.
Section 1.6. "Agreement" means this Revolving Credit Agreement and shall
include any and all amendments, restatements, modifications and supplements
hereto.
Section 1.7. "Appraised Value" means, with respect to any Investment, the
value of such Investment reflected in the most recent Qualified Appraisal
prepared with respect to such Investment.
Section 1.8. "Assignment and Acceptance" has the meaning ascribed to it in
Section 11.1. hereof.
Section 1.9. "Balloon Payments" means, as of any date as of which the
amount thereof shall be determined, an amount equal to the Company's aggregate
obligation to make payments of principal in respect of Indebtedness having a
maturity during the immediately succeeding six (6) month period minus Liquid
Assets and availability under the Line of Credit and the Via Banque Credit
Facility; provided, however, that any Indebtedness with respect to which the
Company has received a commitment for the renewal or other refinancing of such
Indebtedness shall not be included in the computation of Balloon Payments and
provided, further, that if the calculation of the amount of Balloon Payments
results in a negative number, then the amount thereof shall be deemed to be zero
(0).
Section 1.10. "Bank" has the meaning ascribed to it in the Preamble hereof.
Section 1.11. "Banks" has the meaning ascribed to it in the Preamble
hereof.
Section 1.12. "Bank Affiliate" or "Bank Affiliates" means any Affiliate of
the Agents, the Banks or their parent bank holding companies.
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Section 1.13. "Bank Agents" has the meaning ascribed to it in Section
2.2.8. hereof.
Section 1.14. "Beneficiary" means the beneficiary of any Letter of Credit
issued under this Agreement for the account of the Company.
Section 1.15. "Borrowing Base" means, as of any date as of which the amount
thereof shall be determined, an amount equal to (x) the sum of (i) seventy-five
percent (75%) of Eligible Investments as of such date plus (ii) Liquid Assets as
of such date minus (y) Unsecured Indebtedness as of such date and the Via Banque
Amount as of such date.
Section 1.16. "Borrowing Report" has the meaning ascribed to it in Section
6.1.(c) hereof.
Section 1.17. "Breakage Costs" means an amount equal to all costs either
Agent or any Bank sustains in breaking or unwinding or in not making after
receiving a Notice of Borrowing or a Notice of Continuation or Conversion any
LIBOR funding contract, and all expenses that the Administrative Agent or any
Bank sustains or incurs as a result of prepayment or receipt of principal with
respect to a LIBOR Loan on a day other than the last day of the then current
Interest Period.
Section 1.18. "Business Day" means any day in which dealings in foreign
currencies and exchange between banks may be carried on in the place where the
Eurodollar Office is located and in the place where the head offices of the
Agents are located, other than a Saturday, Sunday, legal holiday or other day on
which banks in such places are required or permitted by law to close.
Section 1.19. "Closing Date" means May 31, 1994.
Section 1.20. "Code" means the Internal Revenue Code of 1986 and the rules
and regulations promulgated thereunder, collectively, as the same may from time
to time be supplemented or amended and remain in effect.
Section 1.21. "Combined Commitment Amount" means an amount equal to the
sum of all Commitments as in effect from time to time in accordance with the
provisions hereof, but in no event greater than ONE HUNDRED TWENTY-SEVEN MILLION
AND NO/100 DOLLARS ($127,000,000.00).
Section 1.22. "Commitment" means, with respect to each Bank, such Bank's
several obligation to make Revolving Loans, to participate in the issuance of
Letters of Credit and to honor Credits Outstanding, as set forth in Schedule
1.22. attached hereto.
Section 1.23. "Commitment Percentage" at any time means, with respect to
each Bank, the percentage equal to such Bank's Commitment
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divided by the then sum of all Commitments. The initial Commitment Percentages
are set opposite each Bank's name on Schedule 1.22. attached hereto.
Section 1.24. "Company" has the meaning ascribed to it in the Preamble
hereof.
Section 1.25. "Company Limited Partnership" means a limited partnership
which is (i) organized to own a Facility of which the Company is the general
partner and owns one hundred percent (100%) of the partnership interests of such
limited partnership and (ii) a borrower with respect to the Line of Credit.
Section 1.26. "Consolidated" or "consolidated" means, with reference to
any term defined in this Agreement, that term as applied to the accounts of the
Company consolidated in accordance with GAAP and whenever "Consolidated" or
"consolidated" is used herein, it shall always mean, with reference to the
Company, Meditrust and all of its Subsidiaries (but including for purposes of
this definition all entities in which the Company has any interest, even if less
than fifty percent (50%)).
Section 1.27. "Construction Investments" means financing extended by the
Company with respect to a Facility which is either under construction (i.e., has
not received a certificate of occupancy) or in development (i.e., has received a
certificate of occupancy or operating license within the preceding eighteen (18)
months); provided, however, that a Facility will not be considered to be in
development if at least three (3) calendar months have lapsed since the date on
which the Facility received a certificate of occupancy and (i) such Facility has
a Fixed Charge Coverage of at least 1.10 to 1.0 or (ii), in the case of a
Facility which is a Pooled Facility, the Pooled Facilities' Fixed Charge
Coverage is at least 1.2 to 1.0 or the Pooled Facility's Fixed Charge Coverage
is at least 0.8 to 1.0 or (iii) in the case of a Facility which is a Pooled
Guaranteed Facility, the Pooled Guaranteed Facilities' Fixed Charge Coverage is
at least 1.0 to 1.0 and the Pooled Guaranteed Facility's Fixed Charge Coverage
is at least 0.8 to 1.0.
Section 1.28. "Continental Investments" means Investments which relate to
Facilities leased or operated by Continental Medical Systems, Inc. or its
affiliates and existing as of the Closing Date and which are subject to
Indebtedness provided by a Person other than the Company.
Section 1.29. "Controlled Limited Partnership" means a limited partnership,
other than a Company Limited Partnership, organized to own a Facility of which
the Company is the sole general partner and which the Company owns at least
sixty six and two/thirds percent (66.66%) of the aggregate partnership interests
of such limited partnership.
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Section 1.30. "Controlled Group" means all trades or businesses (whether
or not incorporated) under common control that, together with the Borrower, are
treated as a single employer under Section 414(b) or 414(c) of the Code or
Section 4001 of ERISA.
Section 1.31. "Credits Outstanding" means, as of any time, the aggregate
current available balances of all issued and outstanding Letters of Credit.
Section 1.32. "Default" means an Event of Default or event or condition
that, but for the lapse of time, the giving of notice, or both, would constitute
an Event of Default.
Section 1.33. "Default Rate" means a rate of interest equal to four
percentage points (4%) above (i) the rate of interest otherwise in effect under
this Agreement or (ii), with respect to a Letter of Credit issued with a
separate Reimbursement Agreement, the rate of interest otherwise in effect under
such Reimbursement Agreement.
Section 1.34. "Delinquent Bank" has the meaning ascribed to it in Section
2.5.5.(a) hereof.
Section 1.35. "Dividend" or "Dividends" means the payment of any dividend
or other distribution in respect of the capital stock of a corporation or, with
respect to Meditrust, shares of beneficial interest, in cash or other property
(excepting distribution in the form of such stock or shares of beneficial
interest) or the redemption or acquisition of any capital stock or shares of
beneficial interest.
Section 1.36. "Drawing" or "Drawings" means any payment(s) or
disbursement(s) made under any Letter of Credit honoring any demand for payment
presented by the Beneficiary in accordance with the terms of such Letter of
Credit.
Section 1.37. "Eligible Investments" means, as of any date as of which the
amount thereof is to be determined, an amount equal to the sum of:
(i) the lesser of the Appraised Value or purchase price of Facilities
owned (whether through fee simple title ownership or pursuant to rights as
lessee under a long-term ground lease) entirely by the Company or a Company
Limited Partnership; plus
(ii) the lesser of the Appraised Value of any Facility securing a
Mortgage or the outstanding principal amount of the Mortgage secured by any such
Facility; plus
(iii) seventy and one-half percent (70.5%) of the lesser of the
Appraised Value or the outstanding principal amount of the Continental
Investments minus the aggregate outstanding principal amount of any loans
secured by a first lien mortgage in the Continental Investments but in no event
greater than FIFTY EIGHT MILLION AND NO/100 DOLLARS ($58,000,000.00); plus
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(iv) seventy five percent (75%) of the amount determined by multiplying
the lesser of the Appraised Value of a Facility owned by a Controlled Limited
Partnership or the purchase price of a Facility owned by a Controlled Limited
Partnership by a fraction, the numerator of which is the Company's aggregate
interest in the Controlled Limited Partnership and the denominator of which is
one hundred (100); but excluding from the calculation thereof:
(a) any Investment in which the Company has granted a voluntary Lien
other than the Continental Investments as set forth above;
(b) any Construction Investments;
(c) any Pooled Facilities or Pooled Guaranteed Facilities which have a
Fixed Charge Coverage of less than 1.0 to 1.0, and as to Pooled Guaranteed
Facilities only, any Pooled Guaranteed Facility which has an individual
Fixed Charge Coverage ratio of less than .8 to 1.0 and, in the case of a
Facility which is not a Pooled Facility or a Pooled Guaranteed Facility,
1.10 to 1.0;
(d) any Investment where audited Financial Statements are not available
within one hundred twenty (120) days after year end; provided, however, that
no Facility shall be excluded from the calculation of Eligible Investments
once such audited Financial Statements are available; and provided, further,
that no Facility shall be excluded from the calculation of Eligible
Investments for failure to deliver Financial Statements if the Investment
Amount of such Facility, when aggregated with the Investment Amount of other
Facilities owned by the same Operator, equal less than FIFTEEN MILLION AND
NO/100 DOLLARS ($15,000,000.00) of the Company's actual Gross Real Estate
Investments in a sale/leaseback transaction or Mortgage and provided,
further, that the foregoing proviso shall not discharge the Company's
obligation to deliver Financial Statements to the Banks upon receipt of the
same by the Company;
(e) any Investment which is delinquent for thirty (30) days or more in
payments to the Company;
(f) Gross Real Estate Investments relating to Controlled Limited
Partnerships which exceed fifteen percent (15%) of the Company's Gross Real
Estate Investments; and
(g) any Investment which is not located within the United States of
America.
Section 1.38. INTENTIONALLY LEFT BLANK.
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Section 1.39. "Environmental Laws" means any and all Laws of any Tribunal
pertaining to the environment, including without limitation, the federal Clean
Water Act, the Clean Air Act, as amended, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended by the Superfund
Amendments and Reauthorization Act of 1986 ("SARA"), and as may be further
amended (all together herein called "CERCLA"), the Federal Water Pollution
Control Amendments, the Resource Conservation and Recovery Act of 1976, as
amended ("RCRA"), the Hazardous Materials Transportation Act of 1975, as
amended, the Safe Drinking Water Act, as amended, the Toxic Substances Control
Act, as amended, and any comparable or similar environmental laws of any state
in which the Company or Operator owns or operates a Facility. Likewise, the
terms "hazardous substance," "release," and "threatened release" herein
referenced in connection with Environmental Laws shall have the meanings
specified in CERCLA and the terms "solid waste" and "dispose" (or "disposed")
shall have the meanings specified in RCRA; provided, however, in the event
either CERCLA or RCRA is amended so as to broaden the meaning of any term
defined therein, such broader meaning shall apply subsequent to the effective
date of such amendment, and provided further that, to the extent the laws of any
state which are applicable to a specific Facility and which establish a meaning
for "hazardous substance," "release," "solid waste" or "disposal" which is
broader than that specified in either CERCLA or RCRA, such broader meaning shall
apply with respect to such Facility.
Section 1.40. "ERISA" means the Employee Retirement Income Security Act of
1974 and the rules and regulations promulgated thereunder, collectively, as the
same may from time to time be supplemented or amended and remain in effect.
Section 1.41. "Eurodollar Office" means, initially, Fleet's office in
Boston, Massachusetts, and thereafter such other office or offices of
Administrative Agent or its Bank Affiliates (as designated from time to time by
notice from the Administrative Agent) through which the LIBOR Rate is
determined. A Eurodollar Office may be, at the option of the Administrative
Agent, either a domestic or a foreign office.
Section 1.42. "Event of Default" has the meaning ascribed to it in Section
10 hereof.
Section 1.43. "Expected Loan Date" has the meaning ascribed to it in
Section 2.1.5. hereof.
Section 1.44. "Facility" or "Facilities" means a health care facility
(including, but not limited to, long-term care and retirement living facilities,
psychiatric and rehabilitation hospitals, alcohol and substance abuse treatment
facilities and medical office buildings), whether already existing or under
construction, owned (whether through fee simple title ownership or pursuant to
rights as lessee under a long-term ground lease) by the Company, a Company
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Limited Partnership, a Controlled Limited Partnership or any Subsidiary or upon
which the Company, a Company Limited Partnership, a Controlled Limited
Partnership or any Subsidiary of the Company holds a Mortgage.
Section 1.45. "Facility Fee" has the meaning ascribed to it in Section
2.4.2. hereof.
Section 1.46. "Federal Funds Effective Rate" means for any day, a
fluctuating interest rate per annum 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, as published for such day (or, if such
day is not a Business Day, for the preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three (3) Federal funds brokers of
recognized standing selected by the Administrative Agent.
Section 1.47. "Fees" means the Unused Fee, the Facility Fee, and any and
all commission, issuance and other fees, if any, payable hereunder or under a
separate Reimbursement Agreement in respect of a Letter of Credit.
Section 1.48. "Financial Statement" or "Financial Statements" means, as of
any date, or with respect to any period, as applicable, a financial report or
reports consisting of (i) a balance sheet; (ii) an income statement; (iii) a
statement of cash flow; (iv) a statement of retained earnings (if prepared by
the Company); and (v) changes in stockholders' equity.
Section 1.49. "Fixed Charge Coverage" means, with respect to any Facility,
Pooled Facilities or Pooled Guaranteed Facilities, the ratio of (x) pre-tax net
income plus Operator Interest Expense, Mortgage Expense (but excluding therefrom
any amounts relating to principal), Lease Rental Expense, depreciation and
amortization on the Facility, Pooled Facilities or Pooled Guaranteed Facilities,
management fees and any revenues from prior period adjustments relating to the
settlement, filing or audit of cost reports less Imputed Management Fees to (y)
the sum of Operator Interest Expense (but excluding therefrom Operator Interest
Expense, the payment of which is subordinated to the payment of Indebtedness
owing to the Company), Mortgage Expense, Lease Rental Expense, and current
maturities of Indebtedness of the Operator (other than Indebtedness relating to
a Mortgage) which are not subordinated to the Company, all of the foregoing
calculated by reference to the immediately preceding six (6) month period.
Section 1.50. "Funded Debt" shall mean and include, without duplication,
(i) any obligation payable more than one (1) year from the date
of creation thereof which, under GAAP, is shown on a balance sheet of
a Person as a liability (including capitalized lease obligations and
excluding reserves to the extent that such reserves do not constitute
an obligation),
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(ii) Indebtedness payable more than one (1) year from the date of creation
thereof which is secured by any Lien on property owned by the Company or any
Subsidiary, whether or not the Indebtedness secured thereby shall have been
assumed by the Company or such Subsidiary,
(iii) Guarantees (other than endorsements of negotiable instruments for
collection in the ordinary course of business) and other contingent liabilities
(whether direct or indirect) in connection with the obligations, stock or
dividends of any Person,
(iv) obligations under any contract providing for the making of loans,
advances or capital contributions to any Person, or for the purchase of any
property from any Person, in each case in order to enable such Person primarily
to maintain working capital, net worth or any other balance sheet condition or
to pay debts, dividends or expenses,
(v) obligations under any contract for the purchase of materials, supplies
or other property or services if such contract (or any related document)
requires that payment for such materials, supplies or other property or services
shall be made regardless of whether or not delivery of such materials, supplies
or other property or services is ever made or tendered,
(vi) obligations under any contract to rent or lease (as lessee) any real
or personal property if such contract (or any related document) provides that
the obligation to make payments thereunder is absolute and unconditional under
conditions not customarily found in commercial leases then in general use or
requires that the lessee purchase or otherwise acquire securities or obligations
of the lessor,
(vii) obligations under any contract for the sale or use of materials,
supplies or other property or services if such contract (or any related
document) requires that payment for such materials, supplies or other property
or services, or the use thereof, shall be subordinated to any indebtedness (of
the purchaser or user of such materials, supplies or other property or the
Person entitled to the benefit of such services) owed or to be owed to any
Person,
(viii) any arrangement with any lender or investor or to which such
lender or investor is a party providing for the leasing by the Company or any
Subsidiary of real property which has been or is to be sold or transferred by
the Company or any Subsidiary to such lender or investor or to any Person to
whom funds have been or are to be advanced by such lender or investor on the
security of such property or rental obligations of the Company or any
Subsidiary, and
(ix) obligations under any other contract which, in economic effect, is
substantially equivalent to a Guarantee.
Section 1.51. "GAAP" means generally accepted accounting principles in the
United States of America in effect from time to time.
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Section 1.52. "Gross Real Estate Investments" means, as of any date as of
which the amount thereof shall be determined, an amount equal to the purchase
price of Facilities owned by, or the amount of the Company's investment in
Facilities leased by, the Company plus the outstanding principal amount of
Mortgages encumbering Facilities which are owned by Persons other than the
Company as of such date.
Section 1.53. "Guarantees" means, as applied to the Company and its
Subsidiaries, all guarantees, endorsements or other contingent or surety
obligations with respect to obligations of any other Person (except those made
to or by the Company or any Subsidiary with respect to an underlying obligation
of the Company, any Subsidiary, any Company Limited Partnership or any
Controlled Limited Partnership), whether or not reflected on the balance sheet
of the Company or its Subsidiaries, including any obligation to furnish funds,
directly or indirectly (whether by virtue of partnership arrangements, by
agreement to keep-well or otherwise), through the purchase of goods, supplies or
services, or by way of stock purchase, capital contribution, advance or loan, or
to enter into a contract for any of the foregoing, for the purpose of payment of
obligations of any other Person.
Section 1.54. "Guaranty" has the meaning ascribed to it in Section 2.1.18.
hereof.
Section 1.55. "Hazardous Materials" means (i) any chemical, compound,
material, mixture or substance that is now or hereafter defined as or included
in the definition of "hazardous substances", "hazardous wastes", "hazardous
materials", "extremely hazardous waste", "restricted hazardous waste", or "toxic
substances" or terms of similar import under any Environmental Laws; (ii) any
oil, petroleum or petroleum derived substance, any drilling fluids, produced
waters and other wastes associated with the exploration, development or
production of crude oil, any flammable substances or explosives, any radioactive
materials, any hazardous wastes or substances, any toxic wastes or substances or
any other materials or pollutants which (a) poses a hazard to human health or
the environment or (b) causes any of any properties or assets of the Company or
its Subsidiaries to be in violation of any Environmental Laws; (iii) asbestos in
any form, urea formaldehyde foam insulation, electrical equipment which contains
any oil or dielectric fluid containing levels of polychlorinated biphenyls in
excess of fifty (50) parts per million; (iv) to the extent prohibited or
required to be mitigated by any Environmental Laws, lead in paint, plaster or
other accessible materials and (v) any other chemical, material or substance,
exposure to, or disposal of, which is now or hereafter prohibited, limited or
regulated by any Tribunal but shall not mean cleaning agents, pharmaceuticals
and petroleum products in such quantities and concentrations as are customarily
used in connection with the operation and maintenance of health care facilities
and which are used in compliance with applicable Environmental Laws.
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Section 1.56. "Imputed Management Fees" means, for any period, an amount
equal to five percent (5%) of the net revenues of a Facility.
Section 1.57. "Indebtedness" means any obligation for borrowed money (and
any notes payable and drafts accepted representing extensions of credit whether
or not representing obligations for borrowed money).
Section 1.58. "Insurance" has the meaning ascribed to it in Section 6.3.(c)
hereof.
Section 1.59. "Interest Expense" for any period shall mean, on a
consolidated basis, the sum of all interest on, and all amortization of debt
discount and expenses on, all Indebtedness of the Company and its Subsidiaries
outstanding at any time during such period.
Section 1.60. "Interest Period" means, (i) with respect to each LIBOR Loan,
the period commencing on the date of the making or continuation of, or
conversion to, such Loan and ending one (1), two (2), or three (3) months
thereafter, as the Borrower may elect in the applicable Notice of Borrowing or
Notice of Continuation or Conversion and (ii) with respect to a Prime Rate Loan,
the period commencing on the date of the making of such Loan and the date on
which the Prime Rate Loan is repaid or Meditrust on behalf of the Company
elects, in accordance with this Agreement, to convert such Loan to a LIBOR Loan;
provided, however, that:
(i) any Interest Period (other than an Interest Period determined
pursuant to clause (iii) below) that would otherwise end on a
day that is not a Business Day shall be extended to the next
succeeding Business Day unless, in the case of LIBOR Loans,
such Business Day falls in the next calendar month, in which
case such Interest Period shall end on the immediately
preceding Business Day;
(ii) any Interest Period applicable to a LIBOR Loan that begins on
the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall,
subject to clause (iii) below, end on the last Business Day
of a calendar month;
(iii) any Interest Period that would otherwise end after the
Scheduled Maturity Date shall end on the Scheduled Maturity
Date;
(iv) notwithstanding clause (iii) above, no Interest Period
applicable to a LIBOR Loan shall have a duration of less than
one (1) month and if any
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Interest Period applicable to such Loan would be for a
shorter Interest Period, such Interest Period shall not be
available hereunder; and
(v) if the Borrower fails to designate the length of the Interest
Period with respect to a LIBOR Loan, then the period shall be
thirty (30) days.
Section 1.61. "Investment" or "Investments" means a Facility or a Mortgage,
individually or collectively, as the case may be.
Section 1.62. "Investment Amount" means, with respect to any individual
Investment, the purchase price in the case of a Facility owned by the Company,
the amount invested by the Company in the case of a Facility leased by the
Company or the outstanding principal amount in the case of a Mortgage.
Section 1.63. "Investment Commitment" means a commitment, agreement or
undertaking by the Company to acquire a Facility or to make or acquire a
Mortgage.
Section 1.64. "Investment Fee" means a fee paid by a third party to the
Company as an inducement to the Company to make or issue an Investment
Commitment.
Section 1.65. "IRS" has the meaning ascribed to it in Section 3.4. hereof.
Section 1.66. "Law" or "Laws" means all constitutions, treaties, statutes,
laws, ordinances, codes, regulations, rules, orders, decisions, writs,
injunctions, or decrees of the United States of America or any other Tribunal,
now in effect and as hereafter amended, issued, promulgated, or otherwise coming
into effect.
Section 1.67. "Lease" means leases for Facilities for which the Company, a
Company Limited Partnership or a Controlled Limited Partnership is the lessor or
sublessor.
Section 1.68. "Lease Rental Expense" means, for any period and with respect
to any Facility, the total amount payable during such period by the lessee of
such Facility to the Company, including, without limitation, (a) base rent (as
adjusted from time to time), plus (b) all incremental charges to which the
Facility is subject under the lease relating thereto, plus (c) in the case of
ground leases, any other amounts payable thereunder to the Company under the
lease relating thereto.
Section 1.69. "Legal Impediment" has the meaning ascribed to it in Section
2.3.4.(ii)(A) hereof.
Section 1.70. "Legal Requirements" means all Laws, and all recorded or
unrecorded agreements, covenants, restrictions, easements or conditions
(including any requirement of any insurance or surety
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company or any board of fire underwriters), as now in effect and as hereafter
amended, issued, promulgated, or otherwise coming into effect.
Section 1.71. "Letter of Credit" or "Letters of Credit" means any letter(s)
of credit or confirmation(s) thereof issued under this Agreement or a separate
Reimbursement Agreement for the account of the Company, any Subsidiary or any
Affiliate of the Company (including Meditrust-Illinois), including specifically,
the Meditrust-Illinois Letter of Credit, and shall include any Letter of Credit
as it may be amended, modified, renewed or extended from time to time.
Section 1.72. "Letter of Credit Application" has the meaning ascribed to
it in Section 2.2.2. hereof.
Section 1.73. "Letter of Credit Participation" has the meaning set forth
in Section 2.2.3. hereof.
Section 1.74. "Letter of Credit Termination Date" has the meaning ascribed
to it in Section 2.2.6. hereof.
Section 1.75. "LIBOR Base" means the rate per annum (rounded upwards, if
necessary, to the nearest 1/16 of one percentage point (1%) shown on the display
referred to as the "LIBO page" (or any display substituted therefor) of the
Telerate U.S. Domestic Money Service transmitted through the Telerate monitor
system as being the respective rates at which U.S. dollar deposits would be
offered two (2) Business Days prior to the beginning of the relevant Interest
Period by the principal London offices of each of the banks named thereon to
major banks in the London interbank Eurodollar market where the Eurodollar
Office is located at the Relevant Local Time for delivery on the first day of
such Interest Period for the number of days comprised therein and in the amount
of the principal amount of the applicable LIBOR Loan.
Section 1.76. "LIBOR Loan" means a Loan bearing interest at the LIBOR Rate.
Section 1.77. "LIBOR Margin" means, as of any date as of which the amount
thereof shall be determined, an amount determined by reference to the ratio of
the Company's consolidated Total Liabilities to the Company's consolidated
Tangible Net Worth (which ratio shall be determined monthly for purposes of this
definition) as follows:
(i) If the ratio is less than 1.0 to 1.0, then the Libor Margin shall be one
percentage point (1.0%); and
(ii) If the ratio is 1.0 to 1.0 or greater but less than 1.30 to 1.0, then
the Libor Margin shall be one and one-quarter percentage points (1.25%); and
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(iii) If the ratio is 1.30 to 1.0 or greater but less than 1.50 to 1.0, then
the Libor Margin shall be one and one-half percentage points (1.5%).
Section 1.78. "LIBOR Rate" means, with respect to each Interest Period, the
rate per annum equal to the sum of:
(A) (i) the LIBOR Base for such Interest Period divided by (ii) a percentage
equal to one hundred percent (100%) minus the maximum reserve percentage
applicable during such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System for determining the
maximum reserve requirements (including, without limitation, any basic,
supplemental, marginal or emergency reserve requirements) for the Administrative
Agent in respect of liabilities or assets consisting of or including
Eurocurrency liabilities (as defined in Regulation D of the Board of Governors
of the Federal Reserve System) having a term equal to the Interest Period; and
(B) the LIBOR Margin.
Section 1.79. "Lien" means any security interest, mortgage, pledge, lien,
claim, charge, encumbrance, title retention agreement, lessor's interest under a
financing lease or any analogous arrangements in a Person's properties or
assets, intended as, or having the effect of, security, whether voluntary or
involuntary.
Section 1.80. "Line of Credit" has the meaning ascribed to it in Section
2.1.1. hereof.
Section 1.81. "Liquid Assets" means, as of any date as of which the amount
thereof shall be determined, the amount of the Company's cash and cash
equivalents.
Section 1.82. "Litigation" means any proceeding, claim, suit, action, case
or investigation by, before or involving any Tribunal.
Section 1.83. "Loan" means any Revolving Loan.
Section 1.84. "Loan Account" has the meaning ascribed to it in Section
2.1.8. hereof.
Section 1.85. "Loan Documents" means this Agreement, the Notes, and the
Other Documents.
Section 1.86. "Loans" means the Revolving Loans.
Section 1.87. "Majority Banks" means, as of any date, any combination of
the Banks which hold in excess of sixty-six and two thirds percent (66.66%) of
the Outstanding Amount as of such date, and if there shall be no Outstanding
Amount as of such date, any combination of the Banks possessing in excess of
sixty-six and two thirds percent (66.66%) of the then aggregate Commitment
Percentages.
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Section 1.88. "Material Adverse Effect" means an effect resulting from any
circumstance or event of whatever nature (including any adverse determination in
any Litigation) which does, or could reasonably be expected to, materially and
adversely (i) impair the validity or enforceability of this Agreement, the Notes
or the Other Documents, (ii) impair the ability of the Company to pay or perform
the Obligations, (iii) cause an Event of Default or (iv) affect the business
operations or financial condition of the Company taken as a whole.
Section 1.89. "Mediplex" means The Mediplex Group, Inc., a Massachusetts
corporation, having its chief executive office located at 15 Walnut Street,
Wellesley, Massachusetts and any successor thereto, including the entity
resulting from the contemplated merger/acquisition of Mediplex by Sun Healthcare
Group, Inc.
Section 1.90. "Meditrust" has the meaning ascribed to it in the Preamble
hereof.
Section 1.91. "Meditrust-Illinois" means Meditrust of Illinois, Inc., an
Illinois corporation, which is a Subsidiary of Meditrust.
Section 1.92. "Meditrust-Illinois Guarantee" has the meaning ascribed to it
in Section 2.2.1. hereof.
Section 1.93. "Meditrust-Illinois Letter of Credit" has the meaning
ascribed to it in Section 2.2.1. hereof.
Section 1.94. "Meditrust-Illinois Reimbursement Agreement" has the meaning
ascribed to it in Section 2.2.1. hereof.
Section 1.95. "Modified Operating Cash Flow" shall mean, for any period,
the sum of (a) Net Earnings for such period, (b) any gains (net of expenses and
taxes applicable thereto) in excess of losses resulting from the sale,
conversion or other disposition of capital assets (i.e., assets other than
current assets), (c) depreciation and amortization and (d) Investment Fees
received in cash during such period minus the amortized amount of all Investment
Fees included in Net Earnings for such period, all of the foregoing determined
on a consolidated basis.
Section 1.96. "Mortgage" or "Mortgages" means the mortgages of real estate
for which the Company is the mortgagee, whether or not the Company has sold
third party participations in such Mortgages.
Section 1.97. "Mortgage Expense" means, for any period and with respect to
any Facility, the total amount payable during such period by the mortgagor of
such Facility to the Company or any third party under any participating
agreement relating to a Mortgage, including, without limitation, (a) interest
and principal (as adjusted from time to time) plus (b) all incremental charges
to which the Facility is subject under the Mortgage.
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Section 1.98. "Net Earnings" means, for any period, the consolidated net
earnings of Meditrust during such period as determined in accordance with GAAP.
Section 1.99. "Note" or "Notes" means any Revolving Credit Note and
collectively the Revolving Credit Notes.
Section 1.100. "Notice of Borrowing" has the meaning ascribed to it in
Section 2.1.4. hereof.
Section 1.101. "Notice of Continuation or Conversion" has the meaning
ascribed to it in Section 2.3.2. hereof.
Section 1.102. "Notice of Default" has the meaning ascribed to it in
Section 9.5. hereof.
Section 1.103. "Obligations" means any and all loans, advances,
indebtedness, liabilities, obligations, covenants or duties of the Company to
the Agent, any Agent Affiliate, the Banks or any Bank Affiliate under this
Agreement, the Notes or the Other Documents.
Section 1.104. "Operating Cash Flow" shall mean, for any period, the sum of
(a) Net Earnings for such period, (b) depreciation and amortization and (c)
Investment Fees received in cash during such period minus the amortized amount
of all Investment Fees included in Net Earnings for such period, all of the
foregoing determined on a consolidated basis.
Section 1.105. "Operating Facilities" shall mean any Facility, Pooled
Facilities or Pooled Guaranteed Facilities which are not Construction
Investments and which are currently operating in accordance with all applicable
Laws.
Section 1.106. "Operator" means the lessee or sublessee of a Facility owned
or leased by the Company, a Company Limited Partnership or a Controlled Limited
Partnership and also means the mortgagor or lessee or sublessee of a Facility
which is subject to a Mortgage to the extent that such entity controls the
operation of such Facility.
Section 1.107. "Operator Interest Expense" means, for any period, the sum
of all interest on, and all amortization of debt discount and expenses on, all
Indebtedness of an Operator outstanding at any time during such period but
excluding any amounts which constitute Mortgage Expense.
Section 1.108. "Other Documents" means the Guaranty, the Letter of Credit
Applications, the Letters of Credit, the Meditrust-Illinois Reimbursement
Agreement, any other Reimbursement Agreement, the Meditrust-Illinois Guarantee
and any other document, guarantee, agreement or instrument now or hereafter
executed by the Company or any of its Subsidiaries in connection with the Loans
and the Letters of Credit, as renewed, extended, amended, supplemented,
increased, modified, or replaced.
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Section 1.109. "Outstanding Amount" means, as of any date as of which the
amount thereof shall be determined, the aggregate outstanding principal amount
of (i) the Line of Credit, (ii)Credits Outstanding and (iii) the Reimbursement
Obligations, all as of the date of determination.
Section 1.110. "PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to all or part of its functions under ERISA.
Section 1.111. "Permitted Indebtedness" has the meaning ascribed to it in
Section 7.1. hereof.
Section 1.112. "Permitted Investments" means:
(a) Obligations of the United States of America or any department or agency
thereof, and obligations guaranteed by the United States of America, in each
case due within one year from the date of purchase and payable in the United
States in United States dollars,
(b) Prime Commercial Paper which is rated P-1 by Moody's Investors Service,
Inc. ("Moody's") or A-1 by Standard & Poor's Corporation ("S&P"), bankers
acceptances and certificates of deposit in United States commercial banks or
foreign banks with United States branches (having capital resources in excess of
ONE HUNDRED MILLION AND NO/100 DOLLARS ($100,000,000.00) and having a long-term
certificate of deposit rating of either A-1 by Moody's or A+ by S&P),
(c) Repurchase agreements of United States commercial banks or brokerage
institutions or foreign banks with United States branches (any such bank or
institution having capital resources in excess of TWO HUNDRED FIFTY MILLION AND
NO/100 DOLLARS ($250,000,000.00)), in respect of the certificates and
obligations referred to in clause (b) above, provided that any such repurchase
agreement (x) has a term of less than one year and (y) is fully collateralized,
and
(d) Long-term corporate bonds with respect to which the Company has the
option, granted by a brokerage institution having capital resources in excess of
TWO HUNDRED FIFTY MILLION AND NO/100 DOLLARS ($250,000,000.00) and having a
long-term debt rating of either A-1 by Moody's or A+ by S&P, to require such
brokerage institution to repurchase such bonds at par within twelve (12) months
following acquisition thereof by the Company, provided that any such bond (x)
may only be held during the time that the Company is entitled to the benefit of
the repurchase option with respect to such bond, and (y) must be rated at least
BBB- by S&P, and Baa3 by Moody's (provided that no such bond is required to be
rated by both S&P and Moody's).
Section 1.113. "Permitted Liens" has the meaning ascribed to it in Section
7.3. hereof.
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Section 1.114. "Person" means an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated association, joint
venture or other entity of whatever nature, whether public or private.
Section 1.115. "Plan" means, at any time, an employee pension or other
benefit plan that is subject to Title IV of ERISA or subject to the minimum
funding standards under Section 412 of the Code and is either (i) maintained by
the Company or any member of the Controlled Group for employees of the Company
or any member of the Controlled Group or (ii) if such plan is established,
maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one (1) employer makes contributions and to
which the Company or any member of the Controlled Group is then making or
accruing an obligation to make contributions or has within the preceding five
(5) plan years made contributions.
Section 1.116. "Pooled Facilities" means three or more Operating Facilities
having an aggregate appraised value of at least TWENTY MILLION AND NO/100
DOLLARS ($20,000,000.00), (i) the debt financings or leases of which are cross
defaulted and, with respect to Mortgages, cross collateralized and (ii) which
are commonly owned or operated by any Person or Affiliate of such Person.
Section 1.117. "Pooled Guaranteed Facilities" means three or more Operating
Facilities having an aggregate appraised value of at least TWENTY MILLION AND
NO/100 DOLLARS ($20,000,000.00), which are commonly owned or operated by any
Person or Affiliate of such Person and the debt financings or leases of which
are subject to a valid, binding and enforceable unconditional guarantee of
payment from such Person or Affiliate of such Person which commonly owns or
operates such Facilities.
Section 1.118. "Prime Rate" means the rate of interest then announced from
time to time by the Administrative Agent as its prime rate of interest;
provided, however, that if, at any time, the ratio of Meditrust's consolidated
Total Liabilities to Meditrust's consolidated Tangible Net Worth (calculated on
a monthly basis) is greater than 1.5 to 1.0, then the Prime Rate shall mean the
rate of interest announced by the Administrative Agent as its prime rate of
interest plus one-quarter of one percentage point (1/4%). The Prime Rate shall
be adjusted automatically as of the effective date of any change in the prime
rate of interest announced by the Administrative Agent.
Section 1.119. "Prime Rate Loan" means a Loan bearing interest at a rate
equal to the Prime Rate.
Section 1.120. "Qualified Appraisal" means an appraisal independently and
impartially prepared by a qualified appraiser retained or approved in writing by
the Agents and having substantial experience in the appraisal of health care
facilities and conforming to Uniform Standards of Professional Appraisal
Practice ("USPAP") adopted by the Appraisal Standards Board of the Appraisal
Foundation.
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Section 1.121. "Register" has the meaning ascribed to it in Section 11.2.
hereof.
Section 1.122. "Reimbursement Agreement" means any agreement with respect
to a Letter of Credit which establishes terms for the reimbursement of Drawings
thereunder which are different from those set forth in Section 2.2.4.(A) hereof
or which establish rates of interest for Drawings thereunder which are different
from those applicable to Revolving Loans.
Section 1.123. "Reimbursement Obligations" means the obligation of the
Company to reimburse any issuer of any Letter of Credit for (i) any Drawing
honored by such issuer in accordance with Section 2.2.4. hereof or any separate
Reimbursement Agreement relating thereto, plus interest accrued on such Drawing,
and (ii) the fees set forth in Section 2.4.3. hereof or any separate
Reimbursement Agreement relating thereto and the amount of any third party,
out-of-pocket taxes, fees, charges or other reasonable costs and expenses
whatsoever, including reasonable attorneys' fees (collectively, "Expenses"),
incurred by such issuer, the Agents or any Bank in connection with such Drawing
(including, but not limited to, expenses in determining the issuer's obligation
to honor such Drawing).
Section 1.124. "REIT" means a "real estate investment trust," as such term
is defined in Section 856 of the Code.
Section 1.125. "Release" means any release, emission, disposal, leaching,
or migration into the environment (including, without limitation, the
abandonment or improper disposal of any barrels, containers, or other closed
receptacles containing any Hazardous Materials), or into or out of any property
owned, occupied or used by the Company or any of its Subsidiaries.
Section 1.126. "Relevant Local Time" means 10:00 a.m. local time in the
place where the Eurodollar Office is located.
Section 1.127. "Reportable Event" means any of the events described in
Section 4043(b) of ERISA.
Section 1.128. "Request" has the meaning set forth in Section 2.5.6.
hereof.
Section 1.129. "Revolving Credit Note" and "Revolving Credit Notes" have
the meanings ascribed to them in Section 2.1.9. hereof.
Section 1.130. "Revolving Loan" means any loan or advance which the Company
requests pursuant to Section 2.1.1. hereof and Drawings deemed to create
Revolving Loans under Section 2.2.4. hereof (which shall not otherwise be
considered to be Reimbursement Obligations).
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Section 1.131. "Revolving Loans" means each group of Revolving Loans
requested by the Company and made by the Administrative Agent for the accounts
of the Banks under Section 2.1.1. hereof or deemed made under Section 2.2.4.
hereof.
Section 1.132. "Scheduled Maturity Date" has the meaning ascribed to it in
Section 2.1.13. hereof.
Section 1.133. "SEC" means the United States Securities and Exchange
Commission or any successor agency or body.
Section 1.134. "Solvent" means, when used with respect to any Person, that
as of the date as to which the Person's solvency is to be determined:
(a) it has sufficient capital to conduct its business; and
(b) it is able to meet its debts as they mature.
Section 1.135. "Subsidiary" means, in the case of the Company, any
corporation or other entity, including Company Limited Partnerships but
excluding Controlled Limited Partnerships, of which fifty percent (50%) or more
of the outstanding voting stock or interests are owned or controlled directly or
indirectly by the Company or one or more of its Subsidiaries and, in the case of
any other Person, any Person of which fifty percent (50%) or more of the
ordinary voting power for the election of a majority of the members of the board
of directors or other governing body of such Person is held or controlled by
another Person or a Subsidiary of such other Person; or any other organization
the management of which is directly or indirectly controlled by another Person
or Subsidiary of such other Person through the exercise of voting power or
otherwise; or any joint venture, whether incorporated or not, in which a Person
has more than a fifty percent (50%) ownership interest. The term "control" (and
its correlative meanings "controlled by" and "under common control with") as
used in this Section 1.135. means the possession, directly or indirectly, of the
power to direct, or cause the direction of, the management and policies of a
Person, whether through ownership of voting stock, by contract or otherwise.
Section 1.136. "Tangible Net Worth" means, as of any date of which the
amount thereof shall be determined, the excess of (a) the sum of (i) the par
value (or value stated on the books of Meditrust) of the shares of beneficial
interest of Meditrust, plus (or minus, in the case of a surplus deficit) and
(ii) the amount of the consolidated surplus, whether capital or earned, of
Meditrust, over (b) the sum of treasury stock, goodwill, intangible items such
as unamortized debt discount and expense, patents, trade and service marks and
names, copyrights and research and development expenses and any write-up in the
value of assets, all of the foregoing determined on a consolidated basis.
Section 1.137. "Total Capital" means, as of any date as of which the amount
thereof shall be determined, the sum of (i) Meditrust's Funded Debt plus (ii)
Meditrust's Tangible Net Worth as of such date, all of the foregoing determined
on a consolidated basis.
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Section 1.138. "Total Liabilities" means as of any date all of Meditrust's
liabilities that should, in accordance GAAP, be classified as total liabilities
on a balance sheet of Meditrust prepared as of such date, all of the foregoing
determined on a consolidated basis.
Section 1.139. "Tribunal" means any state, commonwealth, country,
municipal, federal, foreign, territorial or other governmental body, court,
administrative department, commission, board, bureau, district, authority,
agency, or instrumentality, or any arbitration authority.
Section 1.140. "Uniform Customs and Practices" means the Uniform Customs
and Practices for Documentary Credits (1993 Revision), International Chamber of
Commerce Publication No. 500 and any successor thereto.
Section 1.141. "Unsecured Indebtedness" means Indebtedness other than
Indebtedness under the Line of Credit and the Via Banque Credit Facility which
is not secured by any Lien.
Section 1.142. "Unused Commitment" means, in the case of each Bank, as of
the date as of which the amount thereof shall be determined, the positive
difference, if any, between (i) the amount of such Bank's Commitment as of such
date and (ii) the aggregate outstanding principal amount of Revolving Loans,
Credits Outstanding and Reimbursement Obligations made by, with respect to or
allocable to (based on such Bank's Commitment Percentage) such Bank as of such
date.
Section 1.143. "Unused Combined Commitment Amount" means, as of any date
as of which the amount thereof shall be determined, the positive difference, if
any, between (i) the Combined Commitment Amount as of such date and (ii) the
Outstanding Amount as of such date.
Section 1.144. "Unused Fee" has the meaning ascribed to it in Section
2.4.1. hereof.
Section 1.145. "Via Banque" means Via Banque, a banking corporation
organized under the laws of the Republic of France.
Section 1.146. "Via Banque Amount" means, as of any date as of which the
amount thereof shall be determined, the principal amount of Indebtedness
outstanding under the Via Banque Credit Facility.
Section 1.147. "Via Banque Credit Facility" means the credit facility
provided to the Company by Via Banque in the original principal amount of FIFTY
MILLION AND NO/100 DOLLARS ($50,000,000.00) as of March 10, 1992, as amended and
in effect from time to time.
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Section 2. THE CREDIT FACILITIES
Section 2.1. The Line of Credit.
Section 2.1.1. Revolving Loans. Subject to the terms and conditions
contained in this Agreement, the Banks agree to extend to the Company a line of
credit and each Bank severally agrees to lend to the Company, and the Company
may borrow, repay and reborrow, on a revolving basis, in one (1) or more
Revolving Loans from time to time during the period commencing after the Closing
Date and continuing through the close of business on the Scheduled Maturity
Date, amounts which are at least TWO MILLION AND NO/100 DOLLARS ($2,000,000.00)
and in integral multiples of FIVE HUNDRED THOUSAND AND NO/100 DOLLARS
($500,000.00) thereafter (except that no Letter of Credit need be in any
specific amount) and which, together with the Outstanding Amount, do not exceed
(after giving effect to all amounts requested) in the aggregate at any one time
outstanding the lesser of the Combined Commitment Amount or the Borrowing Base
in effect from time to time (the "Line of Credit"). Notwithstanding any
provision of this Agreement to the contrary, all Revolving Loans, all Credits
Outstanding and any unpaid Reimbursement Obligations shall constitute one
obligation of the Company to the Banks. Each Bank's obligation to make
Revolving Loans hereunder (i) shall terminate on the Scheduled Maturity Date or
any earlier date as may be provided for in this Agreement and (ii) is limited to
the amount of its Commitment minus its proportionate share (based on its
Commitment Percentage) of (a) Credits Outstanding and (b) unpaid Reimbursement
Obligations.
Section 2.1.2. Use of Proceeds. The proceeds from the Revolving Loans
shall be used by the Company solely (a) to acquire Facilities; (b) to fund
Construction Investments; (c) to extend or acquire loans secured by Mortgages;
(d) for general corporate purposes; and (e) to fund the Reimbursement
Obligations.
Section 2.1.3. Calculation of the Borrowing Base. The Borrowing Base
shall be calculated by reference to the most recent Borrowing Report delivered
by the Company under Section 6.1.(c) hereof. The Company shall calculate the
Borrowing Base on a quarterly basis and Meditrust, on behalf of the Company,
shall immediately notify the Agents when the Outstanding Amount exceeds the
available Borrowing Base and shall pay any excess in accordance with Section
2.1.15. hereof. Meditrust, on behalf of the Company, may request that it
receive a Revolving Loan in excess of the amount which would be available under
the most recent Borrowing Report delivered by the Company; provided, however,
that the Company shall provide the Agents with evidence set forth in a new
Borrowing Report to be delivered with such request that, on a pro forma basis,
the inclusion of the value of new or reappraised Facilities will be sufficient
to increase the Borrowing Base so as to permit the requested borrowing. The
acceptance or rejection of any such request or any calculation of the Borrowing
Base shall be within the reasonable discretion of the Majority Banks.
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Section 2.1.4. Notice of Borrowing. Whenever the Company desires to
obtain a Revolving Loan, and, in any case, promptly after receiving notice from
the Administrative Agent of the making of a Revolving Loan in accordance with
the terms hereof by reason of a Drawing, Meditrust on behalf of the the Company
shall notify the Administrative Agent (which notice shall be irrevocable) by
telex, telegraph or telephone received no later than 11:00 a.m. (Hartford,
Connecticut time) on the date one (1) Business Day before the date of the
requested Revolving Loan in the case of a Prime Rate Loan and no later than 3:00
p.m. (Hartford, Connecticut time) on the date three (3) Business Days before the
date of the requested Revolving Loan in the case of a LIBOR Loan. Such notice
shall specify: (i) the effective date and amount of the requested Revolving
Loan; (ii) the interest rate option to be applicable thereto; and (iii) the
duration of the applicable Interest Period, if any (subject to the provisions of
the definition of Interest Period). Each such notification shall be immediately
followed by a written confirmation thereof by Meditrust on behalf of the Company
in substantially the form of Exhibit A attached hereto (the "Notice of
Borrowing"); provided, however, that if such written confirmation differs in any
material respect from the action taken by the Administrative Agent, the records
of the Administrative Agent shall control absent manifest error. Notwithstanding
the foregoing, no Revolving Loan shall be made unless at the time thereof:
(a) no Default or Event of Default shall exist; and
(b) as of the date of making such Revolving Loan, no event,
circumstance or condition shall exist or shall have occurred and be continuing
which has a Material Adverse Effect. In addition, the Administrative Agent shall
only be required to advance in connection with any Notice of Borrowing an amount
up to the total amount of funds made available to the Administrative Agent by
the Banks in accordance with Section 2.1.5. relating to such Notice of Borrowing
(but this condition shall not be construed as affecting in any manner any Bank's
obligation to make funds available in accordance with such Section 2.1.5.).
Section 2.1.5. Funding of Revolving Loans. The Administrative Agent
shall notify each Bank of its receipt of a Notice of Borrowing and the date that
the Administrative Agent intends to make the Revolving Loan (the "Expected Loan
Date") no later than 3:00 p.m. (Hartford, Connecticut time) on the date on which
the Administrative Agent receives a Notice of Borrowing in the case of Prime
Rate Loans and 11:00 a.m. (Hartford, Connecticut time) on the date immediately
succeeding the date on which such Notice of Borrowing is received in the case of
LIBOR Loans. The Expected Loan Date shall be no earlier than one (1) Business
Day after the delivery of such notice by the Administrative Agent in the case of
Prime Rate Loans and two (2) Business Days after the delivery of such notice by
the Administrative Agent in the case of LIBOR Loans. Not later than 12:00
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noon (Hartford, Connecticut time) on the Expected Loan Date, each Bank shall
make available to the Administrative Agent, at the Administrative Agent's head
office, in immediately available funds, such Bank's pro rata share of such
Revolving Loan (determined as provided in Section 2.1.6. hereof).
Section 2.1.6. Relationship of Revolving Loans to Commitment Amount.
Each Revolving Loan under Section 2.1.1. hereof shall consist of a Revolving
Loan by each Bank in respect of its Commitment, which Revolving Loan shall be
made by each Bank in the proportion that such Bank's Commitment bears to the
Combined Commitment Amount; provided, that if at any time prior to the Scheduled
Maturity Date, for any reason, the proportion that any Bank's Unused Commitment
bears to the Unused Combined Commitment Amount is not equal to the proportion
that the Commitment of such Bank bears to the Combined Commitment Amount, then
each such Bank shall promptly purchase or sell, as may be necessary,
participations in the Revolving Loan held by the other Banks in such amounts as
will (but only if and to the extent that the purchase of such participations
would not cause any Bank to have outstanding Revolving Loans in an amount in
excess of its Commitment and would not cause any Bank to exceed its lending
limit or to violate any other legal requirement to which it is subject), and
make such other adjustments from time to time as shall be necessary to, cause
the proportion that such Bank's Unused Commitment bears to the Unused Combined
Commitment Amount to be equal to the proportion that such Bank's Commitment
bears to the Combined Commitment Amount. Nothing in this Section shall be
construed as requiring any Bank to, and no Bank shall be required to, lend a
dollar amount in excess of the dollar amount of its Commitment, whether by
reason of any other Bank failing to fund its proportionate share of any
Revolving Loan, or otherwise.
Section 2.1.7. Failure to Honor Commitment. The failure of any Bank
to make available its proportionate share of any Revolving Loan with respect to
any Commitment on the date specified therefor shall not relieve any other Bank
ofits respective obligation to make available its share of the Revolving Loan on
such date, but no Bank shall be responsible for the failure of any other Bank to
make available such other Bank's proportionate share of the Revolving Loan with
respect to any Commitment, the Company agreeing that each Bank's Commitment is
and shall be a several, but not joint, obligation.
Section 2.1.8. The Loan Account. Each Revolving Loan shall be
recorded in an account on the books of the Administrative Agent bearing the
Company's name (the "Loan Account"). There shall also be recorded in the Loan
Account all prepayments and payments made by the Company in respect of the Line
of Credit and other appropriate debits and credits as herein provided. The
Administrative Agent shall render and send to Meditrust on behalf of the Company
on a monthly basis a statement of the Loan Account showing the respective
outstanding principal balance of the Line of Credit, together with interest and
other appropriate debits and credits as of the date of the statement. The
statement of the Loan Account shall be considered correct in all
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respects and accepted by and be conclusively binding upon the Company unless the
Company makes specific written objection thereto within sixty (60) days after
the date the statement of the Loan Account is sent.
Section 2.1.9. Revolving Credit Notes. On the Closing Date, the
Company shall issue to the Banks promissory notes executed in substantially the
form attached hereto as Exhibit B (individually a "Revolving Credit Note" and
collectively the "Revolving Credit Notes"), with all blanks therein
appropriately completed. The Revolving Credit Notes shall evidence the
obligation of the Company to repay to the Banks all Revolving Loans made by the
Banks to the Company on account of the Banks' Commitments.
Section 2.1.10. Payment of Principal. The aggregate unpaid principal
amount of all Revolving Loans, together with accrued and unpaid interest
thereon, as evidenced by the Revolving Credit Notes, and all Reimbursement
Obligations, shall, unless sooner accelerated by the Banks following the
occurrence of an Event of Default, be repaid by the Company on the Scheduled
Maturity Date.
Section 2.1.11. Interest Rates and Payments of Interest.
(a) Each Revolving Loan which is a LIBOR Loan shall bear interest on
the outstanding principal amount thereof, for each Interest Period applicable
thereto, at a rate per annum equal to the LIBOR Rate. Such interest shall be
payable (i) in arrears on the last Business Day of the Interest Period with
respect thereto and (ii) when such LIBOR Loan is due (whether at maturity, by
reason of acceleration or otherwise). In addition, upon any prepayment which
has the effect of reducing the outstanding principal amount of any LIBOR Loan to
zero (0), all accrued and unpaid interest in respect of such LIBOR Loan shall be
payable at the time of any such prepayment.
(b) Each Revolving Loan which is a Prime Rate Loan shall bear interest
on the outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the Prime Rate in effect from time to
time. Such interest shall be payable (i) quarterly in arrears on the last day
of each quarter commencing June 30, 1994 and continuing on each September 30,
December 31, March 31 and June 30 thereafter and (ii) when such Revolving Loan
is due (whether at maturity, by reason of acceleration or otherwise). In
addition, upon any prepayment which has the effect of reducing the outstanding
principal amount of any Prime Rate Loan to zero (0), all accrued and unpaid
interest in respect of such Prime Rate Loan shall be payable at the time of any
such prepayment.
(c) In addition to interest accruing under subsection (a) or (b)
above, the Company shall pay interest at a rate per annum equal to one eighth of
one percentage point (.125%) on any Revolving Loans in the principal amount of
TWENTY FIVE MILLION AND NO/100 DOLLARS ($25,000,000.00) or more which have been
outstanding (or have been continued or converted) for more than six (6) months.
Any such
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additional interest shall accrue after such six (6) month period and shall be
payable in arrears to the Administrative Agent on behalf of the Banks following
such initial six (6) month period for each three (3) month period (pro rated for
any lesser period of time) that each such Revolving Loan (or continued or
converted Revolving Loan) is outstanding.
Section 2.1.12. Limitations on LIBOR Loans. Notwithstanding any
provision of this Agreement to the contrary, the Company may request, continue
or convert LIBOR Loans under the Agreement if and only if (i) Meditrust
maintains its "investment grade rating" from at least one of the following
rating agencies: Moody's Investors Service, Inc., Standard & Poor's Corporation,
Duff & Phelps Credit Rating Co. or Fitch Investors Service, Inc. and (ii) the
ratio of Meditrust's consolidated Total Liabilities to Meditrust's consolidated
Tangible Net Worth (which ratio shall be calculated on a monthly basis) is less
than 1.50 to 1.0.
Section 2.1.13. Termination. The Line of Credit and the Banks'
obligations to lend thereunder shall terminate on June 30, 1997 (the "Scheduled
Maturity Date"), at which time all outstanding principal, accrued and unpaid
interest and any other sums due and owing under the Line of Credit shall be
immediately due and payable.
Section 2.1.14. Renewal. This Agreement may be renewed upon the
agreement of the Company and all of the Banks no later than June 30, 1996. If
this Agreement shall be so renewed, the Scheduled Maturity Date shall be
extended to June 30, 1999.
Section 2.1.15. Mandatory Prepayments. The Company shall be required,
immediately upon receipt, to pay to the Administrative Agent for the benefit of
the Banks and to Via Banque on a pari passu and pro rata basis, as a prepayment
in respect of outstanding Revolving Loans, one hundred percent (100%) of the net
proceeds (defined as all proceeds received or to be received less customary
transaction costs and expenses) from (i) sales or other dispositions of assets
of the Company, including shares of stock of, and Indebtedness due and owing to,
Subsidiaries of the Company, the aggregate proceeds of which are in excess of
TWO MILLION FIVE HUNDRED THOUSAND AND NO/100 DOLLARS ($2,500,000.00) in the
trailing twelve (12) month period, (ii) the creation or issuance of additional
Indebtedness of the Company (except for loans and advances under the Via Banque
Credit Facility) and (iii) the sale of additional equity securities or other
ownership interests of the Company. In addition, if it should be determined at
any time that the Outstanding Amount exceeds the available Borrowing Base, the
Company shall be required to prepay any such excess amount within five (5)
Business Days following such determination. Further, if at any time the
Outstanding Amount exceeds the Combined Commitment Amount in effect from time
to time, any such excess amount shall be due and payable within five (5)
Business Days.
Section 2.1.16. Reduction of Commitment. The Company may reduce any
unused portion of the Combined Commitment Amount at any time upon ten (10) days
prior written notice from Meditrust on behalf
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of the Company to the Administrative Agent; provided, however, that any such
reduction shall be in an amount of at least FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00) or any multiple thereof and no such reduction shall be subject
to reinstatement. Any such reduction in the Combined Commitment Amount shall
reduce the Commitments of each of the Banks on a pro rata basis in accordance
with their respective Commitment Percentages.
Section 2.1.17. Joint and Several Obligations. Meditrust and each
Subsidiary which is a borrower under this Agreement acknowledge and agree that
their liability under this Agreement, the Notes and the Other Documents in
respect of the Obligations shall be joint and several.
Section 2.1.18. Guaranty. Meditrust shall unconditionally guarantee
the payment and performance of the obligations of each Subsidiary which is a
borrower under this Agreement to the Banks under this Agreement, the Notes and
the Other Documents pursuant to a continuing guaranty agreement in the form
attached hereto as Exhibit C (the "Guaranty").
Section 2.2. The Letters of Credit.
Section 2.2.1. Issuance. The Administrative Agent hereby agrees,
subject to and in accordance with the terms and conditions set forth in this
Section 2.2., to issue, from time to time after the Closing Date and prior to
the Letter of Credit Termination Date, Letters of Credit on behalf of the Banks
for the account of the Company. Notwithstanding the foregoing, no Letter of
Credit shall be issued unless at the time of such issuance:
(a) the Majority Banks shall consent to the issuance of the
requested Letter of Credit;
(b) no Default or Event of Default shall exist;
(c) no event, circumstance or condition shall exist or shall have
occurred and be continuing which has a Material Adverse Effect;
(d) the face amount of such Letter of Credit, when added to the
Outstanding Amount hereof, does not exceed the lesser of the Combined Commitment
Amount or the Borrowing Base; and
(e) the Letter of Credit provides for an expiration date not
later than the Scheduled Maturity Date.
Notwithstanding the foregoing, at no time shall the aggregate amount of Credits
Outstanding and unpaid Reimbursement Obligations exceed TWENTY FIVE MILLION AND
NO/100 DOLLARS ($25,000,000.00).
In connection with the issuance of any Letter of Credit, the Banks reserve
the right to employ, and the Company shall have the right to request that the
Banks' employ, a separate Reimbursement Agreement to
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set forth the terms and conditions to be applicable to such Letter of Credit;
provided, however, that no separate Reimbursement Agreement shall contain or
provide for any terms, conditions, covenants or Fees which are less favorable to
the Banks than those contained in this Agreement or the Meditrust-Illinois
Reimbursement Agreement.
In addition to the general provisions governing the issuance of Letters of
Credit set forth above, the Company hereby acknowledges and agrees that, upon
the satisfaction of the conditions thereto set forth in the Meditrust-Illinois
Reimbursement Agreement, (i) the Banks have agreed that Fleet shall issue on or
before June 20, 1994 a direct-pay letter of credit in the face amount of up to
SIX MILLION TWO HUNDRED THIRTY SIX THOUSAND ONE HUNDRED SIXTEEN AND NO/100
DOLLARS ($6,236,116.00) for the account of Meditrust-Illinois with respect to
the $6,800,000 in aggregate principal amount of Illinois Health Facilities
Authority Floating Rate Industrial Revenue Bonds, Series 1984 (Midwest
Cambridge, Inc. Project) issued to finance the Facility owned by
Meditrust-Illinois and known as Poplar Creek/Hoffman Estates (the
"Meditrust-Illinois Letter of Credit") and (ii) Meditrust shall guarantee the
payment and performance of any and all reimbursement obligations of
Meditrust-Illinois under that certain Reimbursement Agreement dated as of June
1, 1994 by and between Meditrust-Illinois and Fleet (the "Meditrust-Illinois
Reimbursement Agreement") pursuant to a certain Letter of Credit Guarantee by
Meditrust in favor of Fleet dated as of June 1, 1994 (the "Meditrust-Illinois
Guarantee").
Section 2.2.2. Application. The Company shall request the issuance of
a Letter of Credit by its execution and delivery to the Administrative Agent of
an application in a form required by the Administrative Agent (the "Letter of
Credit Application") at least thirty (30) Business Days before the date on which
the requested Letter of Credit is to be issued, which shall be accompanied by a
certification from a duly authorized officer of the Company with respect to the
same representations and warranties as are required to be certified in the
Notice of Borrowing. If the Letter of Credit Application is acceptable to the
Administrative Agent, in its reasonable discretion, and the conditions to the
issuance of Letter of Credit set forth in Section 2.2.1. hereof have been
satisfied, then the Administrative Agent shall prepare the Letter of Credit in a
form acceptable to the Administrative Agent in accordance with the instructions
set forth in the Letter of Credit Application and reasonably acceptable to the
Company and provided that there is adequate availability under the Line of
Credit as set forth in Section 2.1.1. above, issue the Letter of Credit to the
Beneficiary of such Letter of Credit unless otherwise instructed by the Company.
Section 2.2.3. Letter of Credit Participation.
(a) The Company and each Bank hereby acknowledge that each Letter of
Credit, including specifically, the Meditrust-Illinois Letter of Credit, issued
by the Administrative Agent under this Agreement is issued by the Administrative
Agent on behalf of all of the Banks. Each Bank severally agrees that it shall
be absolutely liable, without regard to the occurrence of any Default or Event
of
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Default or any other condition precedent whatsoever, to the extent of such
Bank's Commitment Percentage, to reimburse the Administrative Agent on demand
(in accordance with Section 2.2.5. hereof) for the amount of each Drawing
honored by the Administrative Agent under each Letter of Credit to the extent
that such amount has not previously been reimbursed by the Company (such
agreement for a Bank being referred to herein as the "Letter of Credit
Participation" of such Bank), and each such payment made by a Bank shall be
treated as the purchase by such Bank of a participating interest in the
Company's Reimbursement Obligation under Section 2.2.4. hereof in an amount
equal to such payment.
(b) Each Bank shall share in any interest which accrues pursuant to
Section 2.2.4. hereof (from and including the date that such interest begins to
accrue) and fees under Section 2.4.3. hereof in accordance with its
participating interest.
Section 2.2.4. Reimbursement of Drawings/Pay down of Credits
Outstanding. The Company hereby acknowledges and agrees that it shall be
obligated to reimburse, and shall thereupon reimburse, the Administrative Agent
for any Drawing (or, in the case of subsection (A)(b) below, shall (i) repay any
Revolving Loan made by reason of such Drawing or (ii) pay down Credits
Outstanding):
(A) With respect to any Letter of Credit issued without a separate
Reimbursement Agreement:
(a) except as provided in subsection (b) below, (I) on the Scheduled
Maturity Date with respect to any Drawing made on or prior to the Scheduled
Maturity Date, and (II) with respect to any Drawing made after the Scheduled
Maturity Date, within one (1) Business Day after the Company shall have received
notice from the Administrative Agent that any Drawing was honored; and
(b) upon the termination of the obligation of the Banks to make
Revolving Loans and to issue Letters of Credit, the termination of the
Commitments by the Company or the acceleration of the Reimbursement Obligations
hereof, in an amount equal to the sum of (i) Credits Outstanding as of such date
(except to the extent that the Company returns or causes to have returned any
Letter of Credit prior to a Drawing thereunder) plus (ii) the amount of all then
unpaid Reimbursement Obligations.
(B) With respect to any Letter of Credit issued with a separate
Reimbursement Agreement, in accordance with the terms and provisions of such
Reimbursement Agreement executed in connection therewith.
Nothing herein is intended to supersede any reimbursement directions
contained in any separate Reimbursement Agreement executed in connection with
any Letter of Credit. The Company shall pay interest at the Default Rate on
any amounts due and payable with respect to any Revolving Loan created under
this Section 2.2.4. from the date such amounts are payable (whether at
maturity, by acceleration or
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otherwise) after any applicable cure period and, in all events, regardless of
any cure period, after the Scheduled Maturity Date, and until paid in full. In
connection with any Reimbursement Obligation or other payment obligation created
with respect to a Letter of Credit issued with a separate Reimbursement
Agreement, from the date of creation of such obligation to the earlier of the
date of payment thereof, the due date therefor or the Scheduled Maturity Date,
such unpaid obligation shall bear interest and be payable strictly in accordance
with the provisions of such Reimbursement Agreement and to the extent that any
such Reimbursement Obligation or other obligation remains unpaid on the earlier
of the due date therefor or the Scheduled Maturity Date, such unpaid obligation
shall, on and after the earlier of the due date therefor or Scheduled Maturity
Date, bear interest at the Default Rate.
Notwithstanding the foregoing, all Drawings on Letters of Credit issued
without a separate Reimbursement Agreement which are honored prior to the
Scheduled Maturity Date shall automatically be deemed Revolving Loans made under
Section 2.1.1. and shall be subject to all the terms and conditions in this
Agreement with respect to Revolving Loans; provided, however, that if Meditrust
on behalf of the Company shall not have submitted a Notice of Borrowing with
respect to such Drawing, such Revolving Loan shall be deemed to be a Prime Rate
Loan by the Administrative Agent. Drawings under any Letter of Credit issued
with a separate Reimbursement Agreement shall create a Reimbursement Obligation
but shall not create a Revolving Loan hereunder unless requested by Meditrust on
behalf of the Company or the separate Reimbursement Agreement so provides.
Section 2.2.5. Letter of Credit Payments. If any Drawing shall be
presented under any Letter of Credit, the Administrative Agent shall immediately
notify the Company of the date and amount of the Drawing presented and of the
date and time when the Administrative Agent expects to honor such Drawing. On
the date of any such Drawing or the date of the creation of any Reimbursement
Obligation which does not arise from a Drawing, the Administrative Agent shall
notify the Banks no later than 3:00 p.m. (Hartford, Connecticut time) of the
amount of any Revolving Loan or Reimbursement Obligation created by reason
thereof. No later than 12:00 noon (Hartford, Connecticut time) on the Business
Day next following the receipt of such notice, each Bank shall make available to
the Administrative Agent, at the Administrative Agent's Head Office, in
immediately available funds, such Bank's Commitment Percentage of such Revolving
Loan or unpaid Reimbursement Obligation (determined by multiplying such Bank's
Commitment Percentage by the amount of such Revolving Loan or unpaid
Reimbursement Obligation).
Section 2.2.6. Termination of Obligation. The obligation of the
Administrative Agent to issue Letters of Credit under this Section 2.2. or any
separate Reimbursement Agreement shall terminate ninety (90) days prior to the
Scheduled Maturity Date (the "Letter of Credit Termination Date").
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Section 2.2.7. Obligations Absolute. The obligations of the Company
with respect to Letters of Credit issued under this Agreement and with respect
to Reimbursement Obligations shall be unconditional and irrevocable, shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, shall rank pari passu with the obligation of the Company to repay
the Loans and shall not be reduced by: (a) any lack of validity or
enforceability of any document executed between the Company and a Beneficiary;
(b) the existence of any claim, set-off, defense or other right which the
Company or any Subsidiary may have at any time against a Beneficiary or any
transferee of a Letter of Credit (or any Persons for which such Beneficiary or
any such transferee may be acting), or against the Agents, any Bank or any Bank
Affiliate or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction; and (c) any
statement or any other document presented under a Letter of Credit proving to be
forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect, unless the Agents, any Bank
or any Bank Affiliate acted with gross negligence or wanton or willful
misconduct.
Section 2.2.8. Indemnification. The Company hereby indemnifies and
holds the Agents, the Banks, the Bank Affiliates and their directors, officers,
employees and agents (collectively, the "Bank Agents"), harmless from and
against any and all claims, damages, losses, liabilities, costs or expenses
(including reasonable legal fees and expenses) which either Agent, any Bank, any
Bank Affiliate or any Bank Agents may incur or which may be claimed against
either Agent, any Bank, any Bank Affiliate or any Bank Agent by any Person by
reason of or in connection with the execution and delivery or transfer of, or
payment or failure to make lawful payment under, a Letter of Credit; provided,
however, that the Company shall not be required to indemnify either Agent, any
Bank, any Bank Affiliate or any Bank Agent for any claims, damages, losses,
liabilities, costs or expenses to the extent, but only to the extent, caused by
such Agent's, such Bank's, such Bank Affiliate's or Bank Agent's gross
negligence or wanton and willful misconduct. Nothing in this Section 2.2.8. is
intended to limit the Company's obligations hereunder. In case any claim is
asserted or any action or proceeding is brought against either Agent, any Bank,
any Bank Affiliate or any Bank Agent (an "Indemnified Party"), the Indemnified
Party shall promptly notify the Company of such claim, action or proceeding and,
at the option of the Indemnified Party, (i) such Indemnified Party may retain
legal counsel, reasonably satisfactory to the Company, to represent it in such
defense and the Company shall reimburse such Indemnified Party for its
reasonable fees and expenses of such legal counsel or (ii) the Company shall
resist, settle or defend with counsel reasonably acceptable to such Indemnified
Party, such claim, action or proceeding. The Agents, any Bank, any Bank
Affiliate and any Bank Agent shall cooperate and join with the Company, at the
expense of the Company, as may be required in connection with any action taken
or defended by the Company as provided herein.
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Section 2.2.9. Liability of the Banks. Any action, inaction or
omission on the part of either Agent, any Bank or any Bank Affiliate under or in
connection with a Letter of Credit issued hereunder or related instruments or
documents, if not amounting to gross negligence or wanton or willful misconduct,
shall be binding upon the Company, shall not place the Agents, the Banks or any
Bank Affiliate under any liability to the Company or any Subsidiary, shall not
affect, impair, or prevent the vesting of any of the Agents', the Banks' or any
Bank Affiliate's rights or powers hereunder or the Company's obligation to make
full reimbursement to the Agents, the Banks and any Bank Affiliate. The Company
assumes all risks of the acts or omissions of a Beneficiary or transferee of a
Letter of Credit with respect to its use of the Letter of Credit. In
furtherance of, and not in limitation of, the Agents', the Banks' or any Bank
Affiliate's rights and powers under the Uniform Customs and Practices, but
subject to all other provisions of this Section 2.2., it is understood and
agreed that, unless resulting from gross negligence or wanton or willful
misconduct of the Agents, the Banks or any Bank Affiliate, neither the Agents,
the Banks nor any Bank Affiliate shall have any liability for and that the
Company assumes all responsibility for: (a) the genuineness of any signature;
(b) the form, correctness, validity, sufficiency, genuineness, falsification and
legal effect of any draft, certification or other document required by a Letter
of Credit and the authority of the person signing the same; (c) the failure of
any instrument to bear any reference or adequate reference to the Letter of
Credit or the failure of any persons to note the amount of any instrument on the
reverse of the Letter of Credit or to surrender the Letter of Credit or
otherwise to comply with the terms and conditions of the Letter of Credit; (d)
the good faith or acts of any Person other than the Agents, the Banks, any Bank
Affiliate or any Bank Agents; (e) the existence, form, sufficiency or breach of
or default under any other agreement or instrument of any nature whatsoever; (f)
any delay in giving or failure to give any notice, demand or protest; and (g)
any error, omission, delay in or nondelivery of any notice or other
communication, however sent. The determination as to whether the required
documents are presented prior to the expiration of a Letter of Credit issued
hereunder and whether such other documents are in proper and sufficient form for
compliance with the Letter of Credit shall be made by the Administrative Agent
in its sole and absolute discretion, which determination shall be conclusive and
binding upon the Company.
Section 2.3. Interest.
Section 2.3.1. Calculation of Interest. Interest on Prime Rate Loans
shall accrue on the basis of a three hundred sixty-five (365) day year and
interest on LIBOR Loans shall accrue on the basis of a three hundred sixty (360)
day year. In each case, interest shall be calculated according to the actual
number of days elapsed during each accrual period.
Section 2.3.2. Continuation or Conversion of Loans. The Company may
continue or convert all or any part (in amounts which are at least TWO MILLION
AND NO/100 DOLLARS ($2,000,000.00) and in integral multiples of FIVE HUNDRED
THOUSAND AND NO/100 DOLLARS
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($500,000.00)) of any outstanding Revolving Loan into a Loan of any other type
provided for in this Agreement in the same aggregate principal amount, on any
Business Day (which, in the case of a conversion of a LIBOR Loan, shall be the
last day of the Interest Period applicable to such Loan unless the Company shall
prepay all Breakage Costs associated therewith). Whenever the Company desires
to continue or convert a Revolving Loan, including a Revolving Loan resulting
from a Drawing in accordance with the terms hereof, Meditrust on behalf of the
Company shall notify the Administrative Agent (which notice shall be
irrevocable) by telex, telegraph or telephone received no later than 11:00 a.m.
(Hartford, Connecticut time) on the date one (1) Business Day before the date on
which the Revolving Loan is to be continued or converted to a Prime Rate Loan
and three (3) Business Days before the date on which the requested Revolving
Loan is to be continued or converted to LIBOR Loan. Such notice shall specify:
(i) the effective date and amount of each Revolving Loan or portion thereof to
be continued or converted; (ii) the interest rate option to be applicable
thereto; and (iii) the duration of the applicable Interest Period, if any
(subject to the provisions of the definition of Interest Period). Each such
notification shall be immediately followed by a written confirmation thereof by
the Company in substantially the form of Exhibit D attached hereto (the "Notice
of Continuation or Conversion"); provided, however, that if such written
confirmation differs in any material respect from the action taken by the
Administrative Agent, the records of the Administrative Agent shall control
absent manifest error. On each date on which a Notice of Continuation or
Conversion is delivered to the Administrative Agent, the Administrative Agent
shall notify each Bank no later than 3:00 p.m. (Hartford, Connecticut time) of
the receipt of such Notice of Continuation or Conversion.
Section 2.3.3. Duration of Interest Periods.
(a) Subject to the provisions of the definition of Interest
Period, the duration of each Interest Period applicable to a Loan shall
be as specified in the applicable Notice of Borrowing or Notice of
Continuation or Conversion delivered pursuant to the provisions of
Section 2.1.4. or Section 2.3.2.
(b) If the Administrative Agent does not receive a notice of
election of duration of an Interest Period for a Loan pursuant to
subsection (a) above within the applicable time limits specified
therein, or if a Default or an Event of Default exists when such notice
must be given, the Company shall be deemed to have elected to convert
such Loan in whole into a Prime Rate Loan on the last day of the then
current Interest Period with respect thereto, except that if such Loan
is converted to a Prime Rate Loan because an Event of Default exists,
the rate of interest payable on all Loans shall be the Default Rate.
(c) Notwithstanding the foregoing, the Company may not select an
Interest Period that would end, but for the provisions of the
definition ofInterest Period, after the Scheduled Maturity Date.
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Section 2.3.4. Changed Circumstances.
In the event that:
(i) on any date on which the LIBOR Rate would otherwise be set
the Administrative Agent shall have reasonably determined in
good faith (which determination shall be final and
conclusive) that adequate and fair means do not exist for
ascertaining the LIBOR Base, or
(ii) at any time the Administrative Agent shall have reasonably
determined in good faith (which determination shall be final
and conclusive) that:
(A) the making or continuation of or conversion of any Loan
to a LIBOR Loan has been made impracticable or unlawful
by (1) the occurrence of a contingency that materially
and adversely affects the interbank market or (2)
compliance by the Administrative Agent or any Bank in
good faith with any applicable law or governmental
regulation, guideline or order or interpretation or
change thereof by any governmental authority charged
with the interpretation or administration thereof or
with any request or directive of any such governmental
authority, whether or not having the force of law (in
any such case, a "Legal Impediment"); or
(B) the LIBOR Rate shall no longer represent the effective
cost to the Administrative Agent or any Bank for United
States dollar deposits in the interbank market for
deposits in which it regularly participates; or
(C) that U.S. dollar deposits in immediately available funds
in an amount approximately equal to the outstanding
principal balance of the Line of Credit are not readily
available to the Administrative Agent's Eurodollar
Office for delivery on the first day of any Interest
Period;
then, and in any such event, the Administrative Agent shall forthwith so notify
the Company by facsimile notice at least one day prior to (i) the date that the
LIBOR Rate is to be set, (ii) the commencement date of the applicable Interest
Period or (iii) the occurrence of the applicable event, and the Interest Rate
shall become the Prime Rate and shall remain the Prime Rate until the
Administrative Agent determines and so notifies the Company that the
circumstances giving
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rise to such notice no longer apply. Until the Administrative Agent notifies
the Company that the circumstances giving rise to such notice no longer apply,
the obligation of the Administrative Agent to allow selection by the Company of
a LIBOR Loan (during the occurrence of such circumstances, referred to as
"Affected Loans") shall be suspended. If at the time the Administrative Agent
so notifies the Company, the Company has previously given the Administrative
Agent a Notice of Borrowing or a Notice of Continuation or Conversion with
respect to one or more Affected Loans but such borrowing or conversion has not
yet gone into effect, such notification shall be deemed to be void and the
Company may only borrow or convert to a Prime Rate Loan. If as a result of a
Legal Impediment, the Administrative Agent and/or any Bank shall incur Breakage
Costs in converting from a LIBOR Loan, then the Company shall pay all such
Breakage Costs to the Administrative Agent promptly upon its demand therefor for
its account and/or the account of any such Bank.
Section 2.3.5. Payments Not at End of Interest Period. If the Company
for any reason makes any payment of principal with respect to any LIBOR Loan on
any day other than the last day of an Interest Period applicable to such Loan or
fails to borrow or continue, or convert to, a LIBOR Loan after giving a Notice
of Borrowing or Notice of Continuation or Conversion, the Company shall pay to
the Administrative Agent for the account of the Banks an amount equal to all
Breakage Costs associated therewith (which amounts shall be disclosed to the
Company in reasonable detail). The Company shall pay such amount within ten
(10) Business Days of receipt by the Company of a statement therefor.
Section 2.3.6. Usury. If the rate of interest payable by the Company
under this Agreement, the Notes or the Other Documents shall be or become
usurious or otherwise unlawful under laws applicable thereto, the interest rate
shall be reduced to the maximum lawful rate and any amount paid by the Company
in excess of the maximum lawful rate shall be considered a payment in reduction
of principal or, at the sole election of the Banks, shall be returned to the
Company.
Section 2.4. Fees.
Section 2.4.1. Unused Fee. The Company agrees to pay to the
Administrative Agent for the account of the Banks a fee on the average daily
unused portion of the Combined Commitment Amount from the Closing Date until the
Scheduled Maturity Date at the rate of one-half of one percentage point (.5%)
(the "Unused Fee"). The Unused Fee shall be payable in arrears on (i) the last
day of each quarter commencing on June 30, 1994 and continuing on each September
30, December 31, March 31 and June 30 thereafter, (ii) the Scheduled Maturity
Date, (iii) the acceleration of the Obligations and (iv) the termination of this
Agreement. The Administrative Agent shall promptly pay to each Bank its pro
rata share of the Unused Fee.
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Section 2.4.2. Facility Fee. The Company agrees to pay to the
Administrative Agent for the account of the Banks an annual, flat facility fee
equal to one-quarter of one percentage point (.25%) of the Combined Commitment
Amount (the "Facility Fee"). The Facility Fee shall be payable in advance on
the Closing Date and thereafter on each June 30 commencing June 30, 1995. The
Administrative Agent shall promptly pay to each Bank its pro rata share of the
Facility Fee.
Section 2.4.3. Letter of Credit Fees. The Company agrees to pay to
the Administrative Agent for the account of the Banks such issuance, annual,
drawing, amendment and/or renewal fees as the Administrative Agent may
customarily charge in connection with letters of credit of a type and having an
amount and a maturity similar to that of the requested Letter of Credit, and, in
addition thereto, with respect to any Letter of Credit issued with a separate
Reimbursement Agreement, to pay all fees owed to the Administrative Agent as set
forth in such Reimbursement Agreement. The Administrative Agent shall promptly
pay to each Bank its pro rata share of any such fees.
Section 2.4.4. Calculation of Fees. All Fees shall, except as
otherwise provided in this Agreement, be calculated on the basis of a three
hundred sixty (360) day year and according the actual number of days elapsed in
each accrual period.
Section 2.5. General Terms Applicable to the Credit Facility.
Section 2.5.1. Direct Debit. The Company hereby authorizes the
Administrative Agent to automatically debit, charge against and collect from the
Company's demand deposit account established with the Administrative Agent any
and all principal, interest, fees, charges, expenses and other amounts due and
payable under this Agreement as when the same become due and payable.
Section 2.5.2. Overdue Payments. Overdue principal (whether at
maturity, by reason of acceleration or otherwise) and, to the extent permitted
by applicable law, overdue interest and fees and any other amounts payable
hereunder and under the Notes, including unpaid Reimbursement Obligations, shall
bear interest from and including the due date thereof until paid, compounded
monthly and payable on demand, at a rate per annum equal to the Default Rate.
Section 2.5.3. Manner and Time of Payments by the Company. All
payments made by the Company hereunder on account of principal, interest, and
fees and expenses shall be made in United States funds on their respective due
dates to the Administrative Agent for the account of the Banks in immediately
available funds without setoff or counterclaim not later than 12:00 p.m.
(Hartford, Connecticut time) at the head office of the Administrative Agent or
at such other address as the Administrative Agent may from time to time specify
in writing. Any payment required to be made by the Company hereunder on account
of any Letter of Credit which is denominated in a currency other than United
States dollars shall be made in and be equal to the equivalent
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of such currency in United States dollars. Each such payment will be applied,
first, on account of fees and expenses which may be due and payable hereunder,
second, on account of the interest then due and owing, and third, on account of
the principal then due and owing.
Section 2.5.4. Payments among the Agent and the Banks. The
Administrative Agent shall have no obligation to remit to the Banks any amounts
under this Agreement not actually collected from the Company or any Subsidiary.
In addition, in the event that any payment received by the Administrative Agent
is rescinded or must otherwise be restored or returned upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Company or any
Subsidiary or upon the appointment of any intervenor or conservator of, or
trustee or similar official for, the Company or any Subsidiary or any
substantial part of their properties or assets, or otherwise, and if the
Administrative Agent paid any Bank its pro rata share of such payment, then such
Bank shall, on demand from the Administrative Agent, immediately pay to the
Administrative Agent an amount equal to such Bank's pro rata share of any such
payment which must be rescinded, restored or returned by the Administrative
Agent. Any such amount shall be paid no later than 3:00 p.m. (Hartford,
Connecticut time) on the Business Day following the date of demand for payment
by the Administrative Agent and, if not so paid, shall bear interest at the
Federal Funds Effective Rate.
Section 2.5.5. Non-Receipt of Funds by the Administrative
Agent.
(a) Unless the Administrative Agent shall have received notice
from a Bank prior to the date on which such Bank is to provide funds to the
Administrative Agent for a Revolving Loan or Letter of Credit Participation
under such Bank's Commitment that such Bank will not make available to the
Administrative Agent such funds, the Administrative Agent may assume that such
Bank has made such funds available to the Administrative Agent on the date of
the Loan or Drawing, and the Administrative Agent, in its sole discretion, may,
but shall not be obligated to, in reliance upon such assumption, make available
to the Company on such date a corresponding amount. If and to the extent any
Bank shall not have made funds available to the Administrative Agent as
required by this Agreement (whether in connection with a Revolving Loan or a
Drawing), and if the Administrative Agent shall have made such funds available
to the Company, such Bank (a "Delinquent Bank") and the Company severally agree
to repay to the Administrative Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount
is made available to the Company or the Drawing is made, as applicable, until
the date such amount is repaid to the Administrative Agent, at (i) the Federal
Funds Effective Rate, in the case of the Delinquent Bank, and (ii) at the rate
applicable to such Revolving Loan, in the case of the Company. If such Bank
shall repay to the Administrative Agent such corresponding amount (in which
case such Bank shall no longer be deemed a Delinquent Bank) and such amount
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was advanced to the Company, such amount so repaid shall constitute such Bank's
Revolving Loan or unpaid Reimbursement Obligation, as the case may be, under its
Commitment for purposes of this Agreement. Until it shall have paid to the
Administrative Agent any unpaid amount as described above, a Delinquent Bank
(regardless of whether such Bank serves as the Administrative Agent) shall be
deemed to have assigned any and all payments due to it from the Company, whether
on account of outstanding Loans, unpaid Reimbursement Obligations, interest,
fees or otherwise, to the remaining non-Delinquent Banks for application to, and
reduction of, their respective pro rata shares of all outstanding Loans and
unpaid Reimbursement Obligations. If the Delinquent Bank has not paid to the
Administrative Agent any unpaid amount as described above within three (3)
Business Days after demand therefor from the Administrative Agent, then the
Delinquent Bank hereby authorizes the Administrative Agent to distribute such
payments to the non-Delinquent Banks in accordance with their respective pro
rata shares of all outstanding Loans and unpaid Reimbursement Obligations. A
Delinquent Bank shall be deemed to have satisfied in full a delinquency when and
if, as a result of application of the assigned payments to all outstanding Loans
and unpaid Reimbursement Obligations of the non-Delinquent Banks, the Banks'
respective pro rata shares of all outstanding Loans have been returned to those
in effect immediately prior to such delinquency and without giving effect to the
nonpayment causing such delinquency.
(b) Unless the Administrative Agent shall have received notice
from the Company prior to the date on which any payment is due to the Banks
hereunder that the Company will not make such payment in full, the
Administrative Agent may assume that the Company has made such payment in full
to the Administrative Agent on such date, and the Administrative Agent in its
sole discretion may, but shall not be obligated to, in reliance upon such
assumption, cause to be distributed to each Bank on such due date an amount
equal to the amount then due such Bank. If and to the extent that the Company
shall not have so made such payment in full to the Administrative Agent, each
Bank shall repay to the Administrative Agent forthwith on demand such amount
distributed to such Bank together with interest thereon, for each day from the
date such amount is distributed to such Bank until the date such Bank repays
such amount to the Administrative Agent, at the Federal Funds Effective Rate.
(c) Nothing contained in this Section 2.5.5. shall be construed
to relieve any Bank of its obligation to make funds available to the
Administrative Agent under this Agreement except as otherwise expressly provided
herein, nor to relieve the Company of its obligation to make any payment when
due.
Section 2.5.6. Increased Costs and Capital Adequacy.
(a) If any change in any law, regulation, order, decree, treaty,
directive or bulletin or in the interpretation or application thereof after the
date hereof by any court or administrative or
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governmental authority charged with the administration thereof, or if the
Agents' or any Bank's or Bank Affiliate's compliance with any request or
directive (whether or not having the force of law) from any central bank or
monetary authority or other governmental authority, agency or instrumentality
enacted or adopted after the date hereof, shall in any such case:
(i) impose, modify or deem applicable any reserve,
special deposit or similar requirement against any
credit extended by the Banks or any Bank Affiliate
under this Agreement; or
(ii) impose on the Banks or any Bank Affiliate or their
parent bank holding companies any other condition
regarding this Agreement,
and the result of any event referred to in the preceding clause (i) or (ii)
above shall be to increase the cost to the Banks or any Bank Affiliate or such
holding company of issuing, funding or maintaining the Loans or Letters of
Credit (which increase in cost shall be determined by the Banks' reasonable
allocation of the aggregate of such cost increases resulting from such event),
then, upon written request by the Administrative Agent (a "Request"), the
Company shall pay to the Administrative Agent from time to time as specified by
the Agent, additional amounts which shall be sufficient to compensate the Banks
for such increased cost from the date of such change. The Request shall include
a certificate as to such increased cost incurred as a result of any event
mentioned in clause (i) or (ii) above prepared in reasonable detail (which shall
include the method employed by a Bank in determining the allocation of such
costs to the Company) and otherwise in accordance with this subsection (a),
submitted by the Administrative Agent, shall be conclusive evidence, absent
manifest error, as to the amount thereof. Each Bank shall notify the
Administrative Agent in writing of any demand hereunder, which notice shall
include the aforementioned certificate.
(b) (i) In addition to the foregoing, if any change in any
domestic or foreign law, regulation, order, decree, treaty, directive or
bulletin or in the interpretation or application thereof after the date hereof
by any court or administrative or governmental authority charged with the
administration thereof, or if the Administrative Agent's or any Banks' or Bank
Affiliate's compliance with any request or directive (whether or not having the
force of law) from any central bank or monetary authority or other governmental
authority, agency or instrumentality enacted or adopted after the date hereof,
shall in any such case:
(A) subject the Administrative Agent and/or any Bank
or Bank Affiliate to any new or additional tax or change in any tax with respect
to the Notes, the Line of Credit or any Letter of Credit, or change the basis of
taxation of payments to the Administrative Agent and/or any Bank or Bank
Affiliate of principal, commitment fee, interest, premium, or any other amount
payable under the Notes; or
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(B) impose, modify or hold applicable or change any
reserve (including, without limitation, basic, supplemental, marginal and
emergency reserves) on an industry-wide special deposit, capital adequacy,
compulsory loan or similar requirement against assets held by, or deposits or
other liabilities in or for the account of, advances or other credit extended
by, or any other acquisition of funds for loans by (including, without
limitation, all Eurocurrency funding by all "Eurocurrency liabilities" as
defined in Regulation D of the Board of Governors of the Federal Reserve System,
as amended) any office of the Administrative Agent and/or any Bank or Bank
Affiliate; or
(C) impose on the Administrative Agent and/or any Bank
or Bank Affiliate any other condition or change therein; and the result of any
of the foregoing is to increase the cost to the Administrative Agent and/or any
Bank or Bank Affiliate of making, renewing or maintaining advances or extensions
of credit or to reduce any amount receivable thereon then, in any such case, the
Company shall promptly pay the Administrative Agent, upon a Request, such
amounts as will compensate the Administrative Agent and/or any Bank or Bank
Affiliate for such additional cost or reduced amount receivable. Upon the
failure of the Company to compensate the Administrative Agent and/or the Bank or
the Bank Affiliate for the amounts set forth herein within ten (10) Business
Days of a Request, then, at the Administrative Agent's option, the obligation of
the Banks or any Bank Affiliates to make, convert and maintain advances
hereunder as loans under which the Interest Rate is the LIBOR Rate, and the
right of the Company to elect that the Interest Rate be the LIBOR Rate, shall
forthwith be unavailable and the Interest Rate hereunder shall be automatically
converted to the Prime Rate.
(ii) If the Administrative Agent and/or any Bank or Bank
Affiliate becomes entitled to claim any additional amounts payable pursuant to
this subsection (b), the Administrative Agent shall promptly submit to the
Company a Request with respect to such entitlement. A certificate as to any
additional amounts payable pursuant to the foregoing submitted by the
Administrative Agent (and signed by an authorized officer of the Administrative
Agent) to the Company shall, absent manifest error, be conclusive. Each Bank
shall notify the Administrative Agent in writing of any demand hereunder, which
notice shall include the aforementioned certificate.
(iii) If a Request is given, the Company shall have the
option, exercisable by notice to the Administrative Agent given within five (5)
Business Days' after the Company's receipt of such notice, to convert the
Interest Rate to the LIBOR Rate, or the Prime Rate, as applicable; provided,
however, that if the Company makes such election, or if the Interest Rate is
converted to another Interest Rate pursuant to this subsection (b), the Company
shall pay any Breakage Costs incurred in making any such conversion to the
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Administrative Agent promptly, upon demand, for its account and/or the account
of any such Bank or Bank Affiliate. The Administrative Agent shall certify such
costs to the Company, which certification may be based on certifications
submitted to the Administrative Agent, and such certification shall be binding
absent manifest error.
(c) If any Bank shall have determined that (i) the applicability
of any law, rule, regulation or guideline adopted pursuant to or arising out of
the July 1988 report of the Basle Committee on Banking Regulations and
Supervisory Practices entitled "International Convergence of Capital Measurement
and Capital Standards", (ii) the adoption after the date hereof of any
applicable law, rule or regulation regarding capital adequacy, or any change
therein, or (iii) any change in the interpretation or administration thereof, or
compliance by the Banks or any of their parent bank holding companies with any
requirement or directive regarding capital adequacy (whether or not having the
force of law) of any such authority, central bank or comparable agency, except
any such adoption or change or any such compliance with a request or directive
which applies or has been applied solely to the Banks or any of their parent
bank holding companies by reason of events or conditions relating solely to the
Banks, has the effect of reducing the rate of return on the Banks or any of
their parent bank holding companies capital as a consequence of its commitment
hereunder or to a level below that which the Banks or such holding companies
could have achieved but for such adoption, change or compliance by an amount
deemed by the Banks to be material (for which reduction of the rate of return
shall be determined by the Banks' or any such holding company's reasonable
allocation of such reduction of the rate of return resulting from such event)
then, upon the submission of a Request by the Administrative Agent, the Company
shall pay to the Administrative Agent, from time to time as specified by the
Administrative Agent, such additional amount or amounts which shall be
sufficient to compensate the affected Bank(s) for such reduction. A certificate
as to such increased cost incurred by a Bank as a result of any event mentioned
in this subsection (c), prepared in reasonable detail (which shall include the
method employed by such Bank in determining the allocation of such costs to the
Company) and otherwise in accordance with this subsection (c) submitted by the
Administrative Agent to the Company, shall be conclusive evidence, absent
manifest error, as to the amount thereof. Each Bank shall notify the Agent in
writing of any Request hereunder, which notice shall include the aforementioned
certificate.
(d) Except as otherwise specifically provided in this Section,
amounts payable by the Company pursuant to this Section shall be payable within
ten (10) Business Days of receipt by the Company of a Request.
(e) Any certificate relating to a Request shall provide
reasonable supporting documentation relative to the calculation of any amounts
set forth thereon.
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(f) Notwithstanding any provision of this Section 2.5.6. to the
contrary, prior to giving any Request, the Agent or the Bank providing such
Request shall first use its best efforts (which shall not require additional
costs or administrative burdens on the Agent or the Bank) to take such steps
(including, without limitation, changing its head office or Eurodollar Office)
as would eliminate or reduce any cost or expense to be borne by the Company
under this Section 2.5.6.
(g) In lieu of paying any Request, the Company shall have the
right, within thirty (30) Business Days of the delivery of such Request, to
terminate the Commitments by prepaying the entire principal amount due and
payable under this Agreement, the Notes and the Other Documents in accordance
with Section 2.5.8. hereof. In such an event, the Company shall have no
liability to pay any Request.
(h) Notwithstanding any provision of this Section 2.5.6. to the
contrary, in no event shall Borrower be obligated to pay any Request which
relates to any income, excise or franchise taxes imposed or sought to be imposed
on the Agents or any of the Banks.
Section 2.5.7. Withholding Tax Exemption. Each Bank that is not
incorporated under the laws of the United States of America or a state thereof
agrees that such Bank will deliver to each of the Company and the Agent, at
least three (3) Business Days before interest or fees first become payable
hereunder for the account of such Bank, two (2) duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, in either case certifying
whether such Bank is entitled to receive payments under this Agreement and the
Notes without deduction or withholding of any United States Federal income
taxes. Each Bank which so delivers a Form 1001 or 4224 further undertakes to
deliver to each of the Company and the Administrative Agent two (2) additional
copies of such form (or a successor form) on or before the date that such form
expires or becomes obsolete or after the occurrence of any event requiring a
change in the most recent form so delivered by it, and such amendments thereto
or extensions or renewals thereof as may be reasonably requested by the Company
or the Administrative Agent, in each case certifying whether such Bank is
entitled to receive payments under this Agreement and the Notes without
deduction or withholding of any United States Federal income taxes, unless an
event (including without limitation any change in treaty, law or regulation) has
occurred prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent such
Bank from duly completing and delivering any such form with respect to it and
such Bank advises the Company and the Administrative Agent that it is not
capable of receiving payments without any deduction or withholding of United
States federal income tax.
Section 2.5.8. Prepayments of the Loans. The Company may upon at
least three (3) Business Days' notice to the Administrative Agent in the case of
LIBOR Loans and upon at least one (1) Business Day's notice in the case of Prime
Rate Loans (such notice being given by Meditrust on behalf of the Company)
prepay any Revolving Loan in
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whole by paying the entire principal amount of such Loan together with accrued
and unpaid interest thereon to the date of such prepayment and, in the case
where the Administrative Agent will be required to break a LIBOR funding
contract by reason of such prepayment, any Breakage Costs. Any such prepayment
hereunder shall be applied first to any Breakage Costs and other amounts due
with respect to the Revolving Loan being prepaid, then to accrued and unpaid
interest and finally to the principal due in respect thereof. Any and all
prepayments shall not affect the obligation, if any, to pay the regular
installments required hereunder, until all Obligations have been paid in full.
Section 2.5.9. Sharing of Payments, Etc. If any Bank shall effect
payment of any principal, interest, fee or expense under this Agreement or any
Other Document through the exercise of any right of set-off, banker's lien,
counterclaim or similar right, it shall be deemed to have purchased from each of
the other Banks participations in the Revolving Loans made by or the Letter of
Credit Participations held by the other Banks in such amounts, and make such
other adjustments from time to time as shall be equitable, to the end that the
Banks shall share the benefit of such payment pro rata in accordance with the
respective amounts of unpaid principal of and interest on the Revolving Loans
made by and the Letter of Credit Participations held by each of them. To such
end, the Banks shall make appropriate adjustments among themselves (by the
resale of participations sold or otherwise) if such payment is rescinded or must
otherwise be restored. The Company agrees that any Bank so purchasing a
participation in the Revolving Loans made by or the Letter of Credit
Participations held by the other Banks may exercise all rights of set- off,
banker's lien, counterclaim or similar rights with respect to such participation
as fully as if such Bank were a direct holder of the Revolving Loans or the
Letter of Credit Participations in the amount of such participation. Nothing
contained herein shall require any Bank to exercise any such right or shall
affect the right of any Bank to exercise, and retain the benefits of exercising,
any such right with respect to any other indebtedness or obligation of the
Company to such Bank.
Section 2.5.10. Interpretation. Whenever this Agreement shall refer
to the amount of Revolving Loans, Credits Outstanding and/or Reimbursement
Obligations of or made by or with respect to any Bank as of any date, it shall
mean such Bank's share, based on such Bank's then Commitment Percentage, of all
Revolving Loans, Credits Outstanding and/or Reimbursement Obligations as of such
date.
Section 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Agents and the Banks to enter into this Agreement and
to make the Loans and to induce the Agents to issue the Letters of Credit, the
Company makes the following representations and warranties to the Agents and the
Banks, which, except as specifically
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provided below, shall be deemed made as of the Closing Date and as of the date
each Revolving Loan is made and each Letter of Credit is issued which shall
survive the execution and delivery hereof and each performance hereunder. Any
knowledge acquired by the Agents or the Banks shall not diminish its right to
rely upon such representations and warranties.
Section 3.1. Organization, Power and Authority. Meditrust is a
self-administered REIT, validly existing and in good standing under the laws of
the Commonwealth of Massachusetts, and each other Company is a corporation or
partnership duly organized and validly existing under the laws of the
jurisdiction of its organization. Each Company is qualified to do business in
each jurisdiction in which such qualification is necessary in view of its
business and operations or the ownership of its properties, except where the
failure to so qualify would not have a Material Adverse Effect.
Section 3.2. Authority. The execution, delivery and performance by
the Company of this Agreement, the Notes and the Other Documents are within
Meditrust's trust powers and each Company's powers, have been duly authorized by
all necessary action, and do not and will not (a) require any consent or
approval of the shareholders or partners of such Company not obtained, (b)
contravene Meditrust's Declaration of Trust or each other Company's charter,
partnership agreement or by- laws, (c) violate any provision of any Legal
Requirement (including, without limitation, Regulation X of the Board of
Governors of the Federal Reserve System) presently in effect having
applicability to the Company, the violation of which would have a Material
Adverse Effect, (d) result in a breach of or constitute a default under any
indenture or loan or credit agreement or any other agreement, lease or
instrument to which the Company is a party or by which it or its properties may
be bound or affected, the default under or breach of which would have a Material
Adverse Effect, or (e) result in, or require, the creation or imposition of any
mortgage, deed of trust, pledge, lien, security interest or other charge or
encumbrance of any nature upon or with respect to any of the properties now
owned or hereafter acquired by the Company. The Company is not in default under
any such Legal Requirement or any such indenture, agreement, lease or
instrument, which default would result in or cause any Material Adverse Effect.
Section 3.3. No Breach. Neither the execution nor delivery of this
Agreement or the Notes, nor the offering, issuance and sale of the Notes, nor
fulfillment of nor compliance with the terms and provisions hereof and of the
Notes will conflict with, or result in a breach of the terms, conditions or
provisions of, or constitute a default under, or result in any violation of, or
result in the creation of any Lien upon any of the properties or assets of the
Company pursuant to, the Declaration of Trust or by-laws of Meditrust or the
charter, partnership agreement or by-laws of any other Company, any agreement
(including any agreement with stockholders), instrument or Legal Requirements to
which the Company is subject which would have a Material Adverse Effect. Neither
Meditrust nor any Company is a
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party to, or otherwise subject to any provisions contained in, any instrument
evidencing Indebtedness of the Company, any agreement relating thereto or any
other contract or agreement (including its Declaration of Trust, charter or
partnership agreement, as the case may be) which limits the amount of, or
otherwise imposes restrictions on the incurring of, Indebtedness of the Company
of the type to be evidenced by the Notes except as set forth in the Declaration
of Trust and the agreements listed in Schedule 3.3. attached hereto.
Section 3.4. Qualification as a Real Estate Investment Trust.
Meditrust qualified as a REIT under the provisions of the Code, as applicable
for its fiscal years ended December 31, 1988 through December 31, 1993.
Appropriate Federal income tax returns for the fiscal years through December 31,
1992 have been filed by the Company with the Internal Revenue Service (the
"IRS") and no previously filed return has been examined and reported on by the
IRS. Meditrust is in a position to qualify for the 1994 fiscal year as a REIT
under the provisions of the Code. The Company has not incurred any liability
for excise taxes pursuant to Section 4981 of the Code.
Section 3.5. Binding Obligations. This Agreement, the Notes and the
Other Documents, when issued and delivered for value received, constitute the
legal, valid and binding obligations of the Company enforceable against it in
accordance with their respective terms, except as the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally or general principles of equity.
Section 3.6. Permits. The Company possesses all material permits,
authorizations, licenses, approvals, waivers and consents, the failure of which
to possess would have a Material Adverse Effect, all of which are in full force
and effect.
Section 3.7. No Consents. The execution, delivery and performance of
the Agreement, the Notes and the Other Documents did not and does not require
any approval, consent or waiver under any material agreement, document, or
instrument to which the Company is a party or by which it or its properties or
assets may be bound or affected. No approval, authorization, consent, waiver or
order of, or registration, application or filing with, any Tribunal was or is
required in connection with the transactions contemplated by the Agreement, the
Notes or the Other Documents.
Section 3.8. Financial Statements. Meditrust has furnished to the
Agents and the Banks its audited consolidated Financial Statements for the
fiscal year ending December 31, 1993. All Financial Statements of the Company
heretofore delivered to the Agent present fairly in all material respects the
financial condition and results of business operations of the Company for the
periods indicated in accordance with GAAP. The Company has no material direct
or contingent liabilities, liabilities for taxes, unusual commitments or
unrealized or unanticipated losses not disclosed in such Financial Statements
which when taken together would have a Material Adverse
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Effect. Since the date of the latest dated balance sheet included in the
Financial Statements, there has been no material adverse change in the business
operations or financial condition of the Company from that set forth in the
balance sheet contained in such Financial Statements except as disclosed in such
Financial Statements or in Schedule 3.8. attached hereto.
Section 3.9. Financial Information. All written data, reports and
information which the Company has supplied to the Agents or the Banks or caused
to be so supplied by a third party on its behalf in connection with this
Agreement are complete and accurate in all material respects and contain no
material omission or misstatement except such as have been corrected in a
writing delivered to the Agents.
Section 3.10. INTENTIONALLY LEFT BLANK.
Section 3.11. Use of Proceeds. Neither Meditrust nor any other
Company is an "investment company," or an "affiliated person" of, or "promoter"
or "principal underwriter" for, an "investment company," as such terms are
defined in the Investment Company Act of 1940, as amended (15 U.S.C. ##80(a)(1)
et seq.). Neither Meditrust nor any other Company (i) is a "holding company," or
an "affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company," within the meaning of the Public Utility Holding Company Act of 1935,
as amended, or (ii) is subject to regulation under the Federal Power Act, the
Investment Company Act of 1940 or the Interstate Commerce Act, nor is subject to
any other statute or regulation which regulates the incurring of Indebtedness by
Meditrust or any other Company , other than Federal and State securities laws.
The Company does not own any margin security as that term is defined in
Regulation U of the Board of Governors of the Federal Reserve System. None of
the proceeds of the Loans will be used, or have been used, directly or
indirectly, for the purpose of reducing or retiring any Indebtedness which was
originally incurred to purchase or carry any margin security or for any other
purpose which might constitute any of the Loans a "purpose credit" within the
meaning of said Regulation U or Regulations G or X of the Federal Reserve Board.
Section 3.12. Title to Real and Personal Property. Unless otherwise
disclosed to the Agents, the Company has good and marketable fee or leasehold
title to all its real property, including all Facilities owned by the Company, a
Company Limited Partnership or a Controlled Limited Partnership, and good and
marketable title to all the other property and assets, including Mortgages,
reflected in the Financial Statements referred to in Section 3.8. hereof or
acquired by the Company subsequent to such date, free of all Liens except (a)
property and assets sold or otherwise disposed of subsequent to such date; (b)
Permitted Liens; and (c) imperfections of title and other Liens not otherwise
insured against that do not materially detract from the value of the property or
have a Material Adverse Effect. All Mortgages have been properly recorded in
the jurisdictions necessary in order to perfect the Company's Liens therein. No
financing
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statement under any Uniform Commercial Code or other law which names the Company
as a debtor relating to any Facility has been filed in any jurisdiction and the
Company has not signed any financing statement or any security agreement
authorizing any secured party thereunder to file any such financing statement
relating to any Facility except for Permitted Liens or as set forth on Schedule
3.12. attached hereto.
Section 3.13. Statutory Compliance. Except where non-compliance would
not have a Material Adverse Effect, the Company is in material compliance with
all material Laws existing on the date hereof of all Tribunals applicable to it,
its properties and assets and the business conducted by it, including, without
limitation, (i) the provisions of the Code (Sections 856 through 860) relating
to the organization of REITs and their qualification and maintenance as such,
(ii) all SEC and state "blue sky" laws relating to the offering its securities,
(iii) ERISA, (iv) the United States Occupational Safety and Health Act of 1970
and (v) all Environmental Laws.
Section 3.14. Events of Default. No Event of Default has occurred
and/or is continuing and no Default would occur as a result of the execution and
delivery by the Company of this Agreement, the Notes and the Other Documents,
the making of any Revolving Loan or the issuance of any Letter of Credit.
Section 3.15. Other Defaults. The Company is not in default, after
giving effect to any applicable notice, grace or cure periods, in the
performance, observance or fulfillment of any of the material obligations,
covenants or conditions contained in any indenture, mortgage, deed of trust,
lease, agreement, document or instrument to which it is a party or by which it
or its properties and assets are bound, where such default would have a Material
Adverse Effect.
Section 3.16. Taxes. The Company has filed all tax returns and
reports required to be filed by them with any and all Federal, state or local
governmental bodies, instrumentalities or agencies and has paid in full, made
adequate provisions or established adequate reserves for or is contesting in
good faith in appropriate proceedings, the payment of all taxes, interest,
penalties, assessments or deficiencies shown to be due or claimed to be due on
or in respect to such tax returns and reports.
Section 3.17. Solvency. The Company is currently, and after giving
effect to the transactions contemplated by this Agreement will be, Solvent and
is not contemplating either the filing of a petition under any Federal or state
bankruptcy or insolvency law or the liquidating of all or a major portion of its
properties and assets, and the Company has no knowledge of any Person
contemplating the filing of any such petition against it.
Section 3.18. Ranking of Loan. Except as permitted by Section 7.3.
or as set forth in Schedule 3.18. attached hereto, no Indebtedness of the
Company is secured by or otherwise benefits from any Lien on or with respect to
the whole or any part of the Company's
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properties or assets, present or future. The Revolving Loans and other sums
payable by the Company hereunder and under the Notes rank at least equal in
terms of seniority and priority with all Unsecured Indebtedness of the Company
and at least pari passu with the Via Banque Credit Facility. There exists no
default or event or condition which, with the giving of notice or passage of
time, or both, would constitute a default under the provisions of any instrument
evidencing such Indebtedness or of any agreement relating thereto.
Section 3.19. Litigation. Except as set forth on Schedule 3.19. attached
hereto, there are no actions, suits or proceedings by or before any Tribunal or
any arbitration or alternate dispute resolution proceeding, pending or, to the
knowledge of the Company or any of its officers, threatened against the Company
or their properties or assets, which if adversely determined, would have a
Material Adverse Effect.
Section 3.20. Guarantees. Except as permitted under Section 7.2. hereof
or as set forth in the Financial Statements referred to in Section 3.8. hereof
and Schedule 3.20. attached hereto, the Company is not a party to any Guarantee
or other similar type of agreement, and the Company has not offered its
endorsement to any Person which would in any way create a contingent liability
(except by endorsement of negotiable instruments payable at sight for deposit or
collection or similar banking transactions in the Company's ordinary course of
business).
Section 3.21. ERISA. The Company and each member of the Controlled Group
have fulfilled their obligations under the minimum funding standards of ERISA
and the Code with respect to each Plan and are in compliance in all material
respects with the currently applicable provisions of ERISA and the Code, and
have not incurred any liability to the PBGC or a Plan under Title IV of ERISA.
Section 3.22. Environmental Protection. Except as set forth on Schedule
3.22. attached hereto, to the best of the Company's knowledge, after due inquiry
and investigation:
(a) The business operations of the Company and each Facility comply in
all material respects with all applicable Environmental Laws except where
non-compliance would not have a Material Adverse Effect or result in a material
decrease in the value of a Facility.
(b) Neither the Company nor, to the Company's knowledge, any Operator
has received any notice or claim to the effect that it is or may be liable to
any Person as a result of the Release or threatened Release of any Hazardous
Materials or any letter or request for information under CERCLA or any other
Environmental Laws which would have a Material Adverse Effect or result in a
material decrease in the value of a Facility, and, neither the Company, any
Operator nor any Facility are the subject of any investigation by a Federal,
state or local governmental instrumentality, body or agency evaluating whether
any remedial action is needed to respond to a Release or threatened
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Release of any Hazardous Material or claim, or threatened lawsuit or claim
arising under or related to any Environmental Law which would have a Material
Adverse Effect or result in a material decrease in the value of a Facility.
(c) Neither the Company nor, to the Company's knowledge, any Operator
or any Facility are, nor are any of their properties, assets and operations,
subject to any outstanding written order or agreement with any Federal, state or
local governmental instrumentality, body or agency or private party respecting
any Environmental Laws which would have a Material Adverse Effect or result in a
material decrease in the value of a Facility.
(d) Neither the Company, any Operator nor any Facility has filed any
notice under any Environmental Law indicating past or present treatment or
disposal of Hazardous Materials except where non- compliance would not have a
Material Adverse Effect or result in a material decrease in the value of a
Facility, and all of the operations of the Company, any Operator or any Facility
which involve the generation, transportation, treatment, storage or disposal of
Hazardous Materials are in substantial and material compliance with all
Environmental Laws except where non-compliance would not have a Material Adverse
Effect or result in a material decrease in the value of a Facility.
(e) No Hazardous Material exists on, under or about any of the
Facilities, in a manner that could give rise to any claim or suit against the
Company or any Operator, which would have a Material Adverse Effect or result in
a material decrease in the value of a Facility and neither the Company, any
Operator nor any Facility has filed any notice or report of a Release of any
Hazardous Materials that could give rise to any such claim or suit against the
Company or any Operator which would have a Material Adverse Effect or result in
a material decrease in the value of a Facility.
Section 3.23. Facilities and Operators. Each Company which is the owner
or operator of a Facility and, to the knowledge of the Company, each Operator is
in compliance in all material respects with all applicable Laws pertaining to
the ownership or operation of health care facilities of the types owned by the
Company or any Operator.
Section 3.24. Material Subsidiaries. All Subsidiaries of Meditrust other
than Meditrust-Illinois are parties to this Agreement as borrowers and listed
on the signature pages hereto.
Section 3.25. Materiality. Nothing has come to the attention of the
Company that causes it to believe that any documents or agreements delivered or
caused to be delivered by it, or any statements made by the Company or its
agents or representatives, to the Banks or its agents or representatives
regarding the transactions contemplated hereby, contains an untrue statement of
a material fact or omits to state a material fact necessary to make the
statements therein not misleading.
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Section 4. CONDITIONS TO OBLIGATIONS OF THE BANKS
The Agents and the Banks shall have no obligations under this Agreement
unless and until they are satisfied, in their reasonable credit judgment, that
all of the following conditions shall have been fulfilled prior to or on the
Closing Date:
Section 4.1. Authorizations. The Agents shall have received:
(i) evidence satisfactory to the Agents to verify the authority of the
Person or Persons signing this Agreement, the Notes and the Other Documents to
legally bind the Company, and the authority of each Person who will sign the
other statements, reports, certificates and documents called for by the terms of
this Agreement and will otherwise act under this Agreement and the Notes for and
on behalf of the Company; and
(ii) the specimen signature of each Person named pursuant to clause
(i) of this Section 4.1. certified by an appropriate officer of each Company to
be a true specimen thereof.
Section 4.2. Representations and Warranties True. The representations and
warranties contained in Section 3 of this Agreement are true and correct in all
material respects, and Meditrust, on behalf of the Company, shall have so
certified to the Agents.
Section 4.3. Performance and Compliance. The Company shall have performed
and complied in all material respects with all covenants, agreements and
conditions in this Agreement, the Notes and the Other Documents which are
required to be performed or complied with by the Company on or prior to the
Closing Date, and Meditrust, on behalf of the Company, shall have so certified
to the Agents.
Section 4.4. Delivery of Documents. The Company shall have duly executed
and delivered to the Agents on behalf of the Banks, in form and substance
satisfactory to the Banks and their legal counsel, this Agreement, the Notes,
the Other Documents and all further documents as they may request to evidence
the Obligations. In addition, the Agents on behalf of the Banks shall have
received or agreed to waive or delay the receipt of:
Section 4.4.1. A certificate of a duly authorized officer of Meditrust
certifying as to (A) the resolutions of the Trustees of Meditrust approving this
Agreement, the Notes and the Other Documents to which it is a party, (B)
Meditrust's Declaration of Trust and (C) all documents evidencing other
necessary action and governmental approvals, if any, with respect to the
transactions contemplated by this Agreement.
Section 4.4.2. A certificate of the Secretary or Assistant Secretary of
each other Company which is a corporation certifying as to (x) the resolutions
of the Board of Directors of each Company
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approving this Agreement, the Notes and the Other Documents and (y) all
documents evidencing other necessary action and governmental approvals, if any,
with respect to the transactions contemplated by this Agreement.
Section 4.4.3. A certificate from the Secretary of the Commonwealth of
Massachusetts certifying as to the Declaration of Trust of Meditrust.
Section 4.4.4. A certificate from the Secretary of the Commonwealth of
Massachusetts certifying as to the good standing of Meditrust.
Section 4.4.5. A certificate from the Secretary of State of the state of
incorporation of each other Company which is a corporation certifying as to the
good standing of such Company.
Section 4.4.6. A certificate from the Secretary of State of the state of
organization of each Company which is a limited partnership certifying as to the
legal existence of such Company.
Section 4.4.7. Meditrust on behalf of the Company shall deliver a
certificate executed by a duly authorized officer that the Company, after giving
effect to the transactions contemplated by the Agreement, is Solvent on the
Closing Date.
Section 4.4.8. The Company's legal counsel shall deliver to the Agents and
the Banks an opinion as to certain matters relating to the transactions
contemplated by this Agreement, the Notes and the Other Documents, such opinion
to be substantially in the form attached hereto as Exhibit E.
Section 4.4.9. Via Banque shall have executed and delivered to the Banks a
letter acknowledging and agreeing as to the pari passu nature of payments and
borrowings under the Line of Credit and the Via Banque Credit Facility.
Section 4.4.10. Such further documents, instruments and agreements as the
Banks shall reasonably request, all reasonably satisfactory in form and
substance to the Banks and their legal counsel.
Section 5. CONDITIONS TO MAKING REVOLVING LOANS AND ISSUING LETTERS OF
CREDIT
The Agents and the Banks shall have no obligation to make Revolving Loans
or to issue or purchase participations in Letters of Credit unless and until
they are satisfied, in their sole and absolute discretion, that all of the
following conditions shall have been fulfilled prior to or contemporaneously
with the making of such Revolving Loan or the issuance of such Letter of Credit,
as applicable.
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Section 5.1. Notice of Borrowing. The Administrative Agent shall have
received, in a timely manner, a Notice of Borrowing or a Letter of Credit
Application, as applicable, in a form reasonably satisfactory to the
Administrative Agent.
Section 5.2. No Adverse Change. No event, circumstance, or condition
shall exist or shall have occurred and be continuing which has a Material
Adverse Effect and Meditrust shall have so certified on behalf of the Company.
Section 5.3. Truth of Representations and Warranties. All of the
representations and warranties set forth in Section 3 hereof shall be true and
correct in all material respects as of the date of the requested Revolving Loan
or the issuance of the requested Letter of Credit and Meditrust shall have so
certified on behalf of the Company.
Section 5.4. No Default. No event which constitutes an Event of Default
has occurred and is continuing, or would occur as a result of the making of the
requested Revolving Loan or the issuance of the requested Letter of Credit and
Meditrust shall have so certified on behalf of the Company.
Section 5.5. Payment of Fees. The Company shall have paid any fees and
expenses due and payable to the Agents and the Banks under this Agreement and
the Other Documents.
Section 5.6. Authority. To the extent necessary, the authority referred
to in Section 4.1. shall remain in full force and effect and the incumbency of
officers shall be as stated in the certificates of incumbency delivered pursuant
to Section 4.1. or as subsequently reflected in a new certificate of incumbency
delivered to the Agents in connection with the requested Revolving Loan or
Letter of Credit.
Section 5.7. Legal Matters. All legal matters incident to the
transactions contemplated by the requested Letter of Credit shall be reasonably
satisfactory to the Agents and their legal counsel and no change shall have
occurred in any Law or interpretation thereof which, in the opinion of the Banks
and their legal counsel, would make it illegal or against the policy of any
Tribunal for the Agents or any Bank to issue Letters of Credit.
Section 6. AFFIRMATIVE COVENANTS OF BORROWER
The Company covenants and agrees that from the Closing Date until the
payment and performance in full of the Obligations, unless the Agents otherwise
consent in writing:
6.1. Financial Statements and Reporting Requirements.
(a) Quarterly Reports. As soon as available and in any event within
fifty (50) days after the end of each of the first three fiscal quarters of each
fiscal year, the Company shall provide a consolidated Financial Statement to the
Banks, including consolidated
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balance sheets as of the end of such quarter, consolidated statements of income
and statements of cash flow for the period commencing as of the end of the
previous fiscal year and ending with such fiscal quarter (it being understood
that for so long as the Company files reports on Form 10-Q with the SEC, copies
of said Form 10-Q shall satisfy its obligations hereunder), together with a
certificate of a duly authorized officer of Meditrust on behalf of each entity
comprising the Company stating that as of the date of such certificate, to the
best of such officer's knowledge, after reasonable inquiry, no Event of Default
or Default has occurred, or, if an Event of Default or a Default has occurred
and is continuing, a statement as to the nature thereof and the action which the
Company has taken or proposes to take with respect thereto, and further setting
out in such detail as is reasonably required by the Banks.
(b) Annual Reports. As soon as available and in any event within one
hundred (100) days after the end of each fiscal year, the Company shall provide
a consolidated Financial Statement to the Banks for such fiscal year audited
without Qualification by Coopers & Lybrand or such an independent certified
public accountant of recognized standing and acceptable to the Majority Banks,
which Financial Statement shall include the consolidated balance sheets as of
the end of such fiscal year, consolidated statements of income and statements of
cash flow for such year and a consolidated statement of shareholders' equity (it
being understood that for so long as the Company files reports on Form 10-K with
the SEC, copies of said Form 10-K shall satisfy its obligations hereunder),
together with a certificate of a duly authorized officer of Meditrust on behalf
of each entity comprising the Company stating that, as of the date of such
certificate, to the best of such officer's knowledge and after reasonable
inquiry, no Event of Default or Default has occurred, or, if an Event of Default
or a Default has occurred and is continuing, a statement as to the nature
thereof and the action which the Company has taken or proposes to take with
respect thereto further setting out in such detail as is reasonably requested by
the Majority Banks.
(c) Borrowing Base Report. As soon as available but in any event
within thirty (30) days of the end of each fiscal quarter, the Company shall
furnish to the Banks a report in the form of Exhibit F attached hereto setting
forth a computation of the Borrowing Base, a listing of all Investments which
are thirty (30) days or more delinquent in payments to the Company and such
other information in respect of the Borrowing Base as the Banks may reasonably
require (the "Borrowing Report").
(d) Covenant Compliance. The Company shall submit with any quarterly
or annual reports required under subsections (a) or (b) above, a report executed
by a duly authorized officer of Meditrust certifying as to the Company's
compliance with the financial covenants set forth in Section 8 hereof in a form
reasonably acceptable to the Banks.
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(e) Other Reports. As soon as available but no later than one hundred
fifty (150) days after each June 30 and December 31, the Company shall furnish
to the Banks a report, known as the "Meditrust Facility Summary," in
substantially the form of Exhibit G attached hereto. The Company shall also
submit with any quarterly or annual reports required under subsections (a) or
(b) above, a report as to any material litigation relating to the Company not
previously disclosed to the Banks and such other information as the Banks may
reasonably require.
(f) SEC Reports. As soon as available, the Company shall provide the
Banks with copies of any and all reports and filings required to be made by the
Company with the SEC, including Form 10-Q and Form 10-K.
(g) Additional Reports. The Company shall provide the Banks with the
following additional reports:
(i) as soon as available and in any event within a reasonable time
after the close of each fiscal year of Meditrust copies of the portions of any
and all auditor's letters to the trustees of Meditrust or to any other entity
comprising the Company regarding any material weakness of the various accounting
practices and control procedures used by Meditrust or any other entity
comprising the Company;
(ii) promptly after the Company becomes aware of the commencement
thereof, notice of all actions, suits and proceedings before any Tribunal which
are not fully covered by insurance without the applicability of any co-insurance
provisions or which have not been bonded and in which either (a) the amount in
controversy exceeds THREE MILLION AND N0/100 DOLLARS ($3,000,000.00) for any
single proceeding or FIVE MILLION AND NO/100 DOLLARS ($5,000,000.00) in the
aggregate or (b) the results thereof may have a Material Adverse Effect;
(iii) promptly after becoming aware of a claim by any Person that the
Company is in default under any agreement entered into in connection with the
borrowing of money in excess of ONE MILLION AND NO/100 DOLLARS ($1,000,000.00),
notice of any such claim or default;
(iv) notice of any material adverse change in the conduct of the
business operations or financial condition of the Company or any Company Limited
Partnership taken as a whole promptly upon the Company or any Company Limited
Partnership becoming aware of any such change;
(v) notice of any Release or any danger of a Release resulting from a
condition which exists on any Facility which could form a basis for a claim
pursuant to Environmental Laws or of any notification having been filed with
regard to a Release on or into any Facility under any Environmental Laws
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but only if the foregoing may result in a material decrease in the value of such
Facility and such notice shall indicate the steps the Company has or will take
to remediate all hazardous environmental conditions and the reserves it has or
expects to establish in its Financial Statements for such purposes; and
(vi) notice of any Facilities which have not provided the Company with
financial and operating reports for a period of ninety (90) days fromthe date
specified for the delivery thereof promptly upon the passage of such ninetieth
day.
(h) The Company shall provide the Banks, as soon as possible, but in
any event not later than one hundred (100) days after the end of each fiscal
year of Meditrust, a certificate of a duly authorized officer of Meditrust
stating that Meditrust qualified as a REIT under Sections 856 through 860 of the
Code (or any successor provisions thereto) for such fiscal year and that it is
in a position to qualify as such REIT for its current fiscal year.
(i) The Company shall also provide the Banks with such other
information relating to the Company or any of its Subsidiaries (including,
without limitation, any Plan) as the Banks may from time to time reasonably
request.
(j) To the extent any Bank is obligated to do so by applicable Law, it
may deliver to any Tribunal having jurisdiction over it, copies of the reports
and other information provided by the Company to the Banks pursuant to this
Section 6.1.
(k) The Company shall notify the Agents immediately upon the amendment
or modification of the Via Banque Credit Facility and the Banks shall have a
period of five (5) Business Days in which to determine whether or not they wish
to make a corresponding amendment or modification to this Agreement.
Section 6.2. Appraisals. The Company shall, from time to time and upon the
request of the Agents, deliver a Qualified Appraisal with respect to each
Facility and, notwithstanding the foregoing, the Agents may, at the Company's
expense, obtain an updated Qualified Appraisal with respect to any Facility;
provided, however, that, unless an Event of Default has occurred and is
continuing beyond any applicable grace or cure period, the Company shall not
have to pay for a new or updated Qualified Appraisal for which the existing
appraisal is less than eighteen (18) months old or expend more than ONE HUNDRED
THOUSAND ($100,000.00) in any twelve (12) month period in respect of appraisals.
Section 6.3. Maintenance of Property.
(a) The Company covenants to keep and maintain, or to use all reasonable
legal remedies to cause the Operator of each Facility to keep and maintain, all
of their respective material property in good
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repair, working order and condition reasonable wear and tear excepted, and from
time to time to make, or use all reasonable legal remedies to cause to be made,
all proper repairs, renewals or replacements, betterments and improvements
thereto so that the business carried on in connection therewith may be properly
and advantageously conducted at all times.
(b) The Company covenants to procure and maintain, or use all reasonable
legal remedies to cause the Operator of each Facility to procure and maintain,
(i) all necessary licenses and permits and (ii) if operating hospital
facilities, all accreditations or health care facilities accredited, as
appropriate, by the Accreditation Association for Ambulatory Care and the Joint
Commission on Accreditation of Healthcare Organizations (or any successors
thereto).
(c) The Company covenants to (i) keep all of their respective insurable
properties insured, or to use all reasonable legal remedies to cause the
Operator of each Facility to keep such property insured, against loss or damage
by theft, fire, smoke, sprinklers, riot and explosion, such insurance (the
"Insurance") to be in such form, in such amounts and against such other risks
and hazards as are customarily maintained by other Persons operating similar
business and having similar properties in the same general areas in which the
Company presently owns Facilities, including but not limited to liability
coverage; (ii) with respect to Facilities operated pursuant to Leases or
Mortgages in effect on the date of this Agreement, to use all reasonable legal
remedies to cause the Operators of such Facilities to place the Insurance on
each such Facility with an insurer which is financially sound and reputable, and
(iii) with respect to any Facility operated pursuant to a Lease or Mortgage
entered into after the date of this Agreement, to include in such Lease or
Mortgage contractual provisions requiring the Operator thereunder to at all
times have Insurance in effect with respect to such Facility, carried by an
insurer which is financially sound and reputable, and the Company covenants to
use all reasonable legal remedies to enforce such contractual provisions. The
Company further covenants that it shall require, or use its best efforts to
cause the Operator of each Facility to require, that the insurer with respect to
each such Insurance policy provide for thirty (30) days' advance written notice
to the Company of any cancellation or termination of, or other change of any
nature whatsoever in, the coverage provided under any such policy.
Section 6.4. Maintenance of Existence. (a) Meditrust shall preserve and
maintain (i) its qualifications as a REIT under Sections 856 through 860 of the
Code (and any successor provisions thereto) and (ii) the applicability to the
Company and its shareholders of the method of taxation provided for in Section
857(b) of the Code (and any successor provision thereto).
(b) Meditrust shall preserve and maintain its existence as a Massachusetts
business trust and all of its rights, franchises and privileges as a business
trust and each other Company's existence as a
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corporation or partnership in the state in which it is incorporated or organized
and all of its rights, franchises and privileges as a corporation or
partnership. Notwithstanding the foregoing provisions of this subsection (b),
(i) Meditrust may change its existence as a Massachusetts business trust with
the prior written consent of the Banks, which consent shall not be unreasonably
withheld, conditioned or delayed, if such change does not, in the reasonable
opinion of the Banks and their counsel, have a Material Adverse Effect and (ii)
any Subsidiary or Controlled Limited Partnership may be dissolved if it no
longer possesses any assets.
Section 6.5. Taxes and Other Assessments. The Company shall pay and
discharge, and maintain adequate reserves for the payment and discharge of, all
taxes, assessments, government charges or levies, or claims for labor, supplies,
rent or other obligations made against it or its properties and assets which, if
unpaid, might become a Lien against the Company or its properties and assets,
except liabilities which are being contested in good faith in appropriate
proceedings or with respect to which the Company has made adequate provision or
established adequate reserves, except that the Company shall pay all such taxes,
assessments, government charges, levies or claims forthwith upon the
commencement of proceedings to foreclose any Lien that may have attached as
security therefor.
Section 6.6. Inspection. The Company shall permit the Agents or any of
their officers, agents, attorneys or accountants, at their expense and at any
time during normal business hours and upon reasonable prior notice (or if an
Event of Default shall have occurred and is continuing, at any time and without
prior notice), to (i) examine and take abstracts from the books and records of
the Company; and (ii) discuss the affairs, finances and business operations of
the Company with its appropriate officers, employees and accountants; provided,
however, that the right of inspection under this Section 6.6. is subject to the
contractual provisions contained in the Leases and Mortgages and the legal
rights of patients in Facilities.
Section 6.7. Notices of Default. Upon becoming aware of the occurrence of
any Default or Event of Default the Company shall promptly notify the Agents
thereof in writing.
Section 6.8. Maintenance of Books and Records. The Company shall keep
adequate books and records of account, in which true and complete entries will
be made reflecting all of its business and financial transactions, and such
entries will be made in accordance with GAAP including the maintenance of
adequate reserves for depreciation of property, if such reserves are required by
GAAP.
Section 6.9. Maintenance of Permits. The Company shall obtain and/or
maintain in full force and effect all material permits, authorizations,
licenses, approvals, waivers and consents which it presently possesses and are
advisable to maintain or which may become necessary in the future to conduct its
business operations.
Section 6.10. Use of Proceeds. The Company will use the proceeds of the
Loans solely for the purposes set forth in Section 2.1.2. hereof.
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Section 6.11. Change of Offices. The Company shall give the
Agents prompt written notice of any change or relocation of its chief
executive office.
Section 6.12. Compliance with Laws. (a) The Company will, or will use all
reasonable legal remedies to cause the Operators of each of the Facilities to,
comply in all material respects with all Legal Requirements applicable to such
Operators or to the Company as owner or mortgagee of health care facilities,
such compliance to include, without limitation, compliance with all applicable
Laws pertaining to the operation of health care facilities of the types owned by
the Company, paying before the same become delinquent all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits or
its properties, and paying all its properties, except to the extent contested in
good faith by proper proceedings which stay the imposition of any penalty, fine
or Lien resulting from the non-payment thereof and with respect thereof, and
except to the extent that payment of such items or compliance with the relevant
Legal Requirements is the responsibility of the Operator of the Facility, where
the Company is using all reasonable legal remedies to enforce its rights against
such Operator and to obtain compliance by such Operator with the relevant Legal
Requirements, and except where the non-payment or non-compliance would not have
a Material Adverse Effect.
Section 6.13. Compliance with Environmental Laws.
(a) The Company shall promptly advise the Agents in writing and in
reasonable detail of (i) any Release of any Hazardous Material required to be
reported to any Tribunal under any applicable Environmental Laws which would
have a Material Adverse Effect or result in a material decrease in the value of
a Facility; (ii) any and all written communications received by the Company with
respect to claims or suits under such Environmental Laws or any Release of
Hazardous Materials required to be reported to any Tribunal which would have a
Material Adverse Effect or result in a material decrease in the value of a
Facility; or (iii) any remedial action taken by the Company, each Operator or
any other Person in response to any Hazardous Materials on, under or about the
properties or assets of the Company or any Facility, the existence of which
could give rise to a claim or suit which would have a Material Adverse Effect,
result in a material adverse change of any Operator's business operations or
financial condition or result in a material decrease in the value of a Facility.
(b) The Company shall, and shall use all reasonable efforts to insure
that each Facility and each Operator, comply in all material respects with all
Environmental Laws and establish and maintain policies and procedures to ensure
and monitor continued compliance with all Environmental Laws. The Company shall,
and shall use all reasonable efforts to insure that each Facility and Operator,
to the
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extent required by any Environmental Law, promptly take any and all
necessary remedial action in connection with the presence, storage,
use, disposal, transportation or Release of any Hazardous Materials
on, under or about its business premises or any Facility.
Section 6.14. Business of the Borrower. The Company, on a consolidated
basis, will continue to operate the same primary business as those in which it
currently operates (i.e., investing in and financing Facilities).
Section 6.15. Other Subsidiaries. Meditrust shall cause (i) each
Subsidiary (other than a Company which is a signatory to this Agreement) within
thirty (30) days after the organization thereof and (ii) Meditrust-Illinois,
upon the payment in full of, and the release of the documents pertaining to, the
$6,800,000 in aggregate principal amount of Illinois Health Facility Authority
Floating Rate Industrial Revenue Bonds, Series 1984 (Midwest Cambridge, Inc.,
Project) issued to finance the Facility owned by Meditrust-Illinois and known as
Poplar Creek/Hoffman Estates, to become a party to this Agreement and a
signatory of the Notes, with the effect that each such Subsidiary shall be
deemed to become part of the "Company" for the purposes of this Agreement. In
connection therewith, there shall be furnished to each Bank:
(a) Co-maker signature pages, in substantially the form of the Notes,
signed by such Subsidiary to such Bank;
(b) A certificate of a duly authorized officer of such Subsidiary or of the
corporate general partner of such Subsidiary, as the case may be,
certifying as to (x) the resolutions of the Board of Directors of such
Subsidiary or the corporate general partner approving this Agreement,
the Notes and each Other Document to which it is a party in connection
with this Agreement, (y) the by-laws and the charter or the partnership
agreement, as the case may be, of such Subsidiary, and (z) all
documents evidencing other necessary action and governmental approvals,
if any, with respect to this Agreement, the Notes and the Other
Documents;
(c) Certificates of the Secretary or Assistant Secretary of such Subsidiary
or the corporate general partner of such Subsidiary, as the case may
be, certifying as to the names and true signatures of the officers of
the Subsidiary or corporate general partner of such Subsidiary, as the
case may be, a partnership becoming a part of the Company signing this
Agreement, the Notes and the Other Documents and that such officers are
authorized to sign such documents;
(d) A certificate from the Secretary of State of such Subsidiary's state of
organization certifying as to the good standing (or legal existence) of
such Subsidiary;
(e) A favorable opinion of Nutter, McClennen & Fish or other legal counsel
acceptable to the Agents satisfactory in form and substance to the
Agents and their legal counsel; and
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(f) Evidence reasonably satisfactory to the Agents that the transactions
contemplated are in accordance with Regulation U issued by the Board of
Governors of the Federal Reserve System.
Section 6.16. Ranking of Loan. The obligations of the Company to the Banks
under this Agreement and the Notes shall rank at least equal in seniority and
priority with all other Unsecured Indebtedness of the Company and, in the event
that any of such other Indebtedness shall be secured, the obligations to the
Banks hereunder shall be secured likewise so as to continue to rank at least
equal in seniority and priority with such other secured Indebtedness.
Section 6.17. Intercompany Indebtedness. The Company shall use its best
efforts to ensure that all Indebtedness of any Subsidiary to Meditrust or any
other Subsidiary shall be evidenced by an intercompany note.
Section 7. NEGATIVE COVENANTS
The Company covenants and agrees that from the date hereof until the payment
and performance in full of the Obligations, unless the Agents otherwise consent
in writing:
Section 7.1. Limitation on Indebtedness. The Company shall not create,
incur, assume, guarantee or be or remain liable with respect to any Indebtedness
other than the following ("Permitted Indebtedness"):
(a) Indebtedness of the Company or any of its Subsidiaries to the Agents,
the Banks or any Bank Affiliates;
(b) Indebtedness existing as of the date of this Agreement and disclosed on
Schedule 7.1 hereto or in the Financial Statements referred to in
Section 3.8. hereof;
(c) Indebtedness under the Via Banque Credit Facility; and
(d) Indebtedness which satisfies the following conditions:
(1) the additional Indebtedness must conform in all material respect
with the restrictions contained in Section 7.3. hereof regarding
additional Liens;
(2) the terms and provisions of the instrument or instruments
controlling the covenants, events of default and acceleration of
maturity provisions of such additional Indebtedness may not be less
favorable to the Company than the comparable terms and provisions set
forth in this Agreement;
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(3) the additional Indebtedness and the instrument or instruments
controlling the creation, assumption or issuance thereof shall satisfy
the requirements of Section 6.16. hereof;
(4) any additional Indebtedness otherwise permitted by this Section
7.1. shall not affect the Company's obligation to prepay outstanding
Loans pursuant to Section 2.1.15 hereof; and
(5) the proceeds of such additional Indebtedness shall be used to
prepay outstanding Loans as required by said Section 2.1.15.
Section 7.2. Contingent Liabilities. The Company shall not create, incur,
assume, guarantee or remain liable with respect to any Guarantees other than the
following:
(a) Guarantees in favor of the Agents, the Banks or any Bank
Affiliates including the Guaranty and the Meditrust-Illinois Guarantee;
(b) Guarantees existing on the date of this Agreement and disclosed on
Schedule 7.2. attached hereto or in the Financial Statements referred
to in Section 3.8. hereof or in favor of Subsidiaries;
(c) Guarantees resulting from the endorsement of negotiable
instruments for collection in the ordinary course of business;
(d) Guarantees with respect to surety, appeal performance and
return-of-money and other similar obligations incurred in the ordinary
course of business (exclusive of obligations for the payment of
borrowed money) not exceeding ONE HUNDRED THOUSAND AND NO/100 DOLLARS
($100,000.00) in the aggregate;
(e) Guarantees of normal trade debt relating to the acquisition of
goods and supplies;
(f) Guarantees relating to Permitted Indebtedness; and
(g) Guarantees used as a credit enhancement relating to the financing
of one or more health care facilities of a type described in the
definition of Facility, in which event, such health care facilities
shall be deemed to be Facilities for purposes of Sections 6.1., 6.3.
and 6.12. of this Agreement and provided, that such Guarantee shall
cease to be a Guarantee at such time as the Company actually advances
funds as a result of a demand for payment under such Guarantee.
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Section 7.3. Negative Pledge/Encumbrances. The Company shall not create,
incur, assume or suffer to exist any Lien on any of its properties and assets,
or assign or otherwise convey any right to receive income with respect to, any
of its properties and assets except the following ("Permitted Liens"):
(a) Liens for taxes, assessments and governmental charges not yet due
and payable or which are being actively contested in good faith by
appropriate proceedings or for which adequate reserves have been
established in accordance with GAAP,
(b) other Liens incidental to the conduct of the Company's business or
the ownership of its property and assets which were not incurred in
connection with the borrowing of money or the obtaining of advances or
credit, and which do not in the aggregate materially detract from the
value of its property or assets or materially impair the use thereof in
the operation of its business,
(c) existing Liens securing Indebtedness of the Company that is
outstanding on the Closing Date and set forth in Schedule 7.1. attached
hereto or as otherwise described in the Financial Statements
(including, for this purpose, any substitute Lien required to be
created to secure such Indebtedness where (i) either the existing Lien
was released to enable the Company to comply with the option provisions
under a Facility Lease, which permits the lessee thereunder to purchase
the Facility covered by such Lease, or the substitution provisions
under a Facility Lease, which permit the lessee of such Facility to
substitute one property for another under the relevant Lease, and (ii)
a Qualified Appraisal has been obtained which shows that the property
covered by such substitute Lien is of equivalent value to the property
it has replaced, and (iii) the Board of Trustees of Meditrust has made
a good faith determination that the property subject to such substitute
Lien is of equivalent value to the property it has replaced, and (iv)
the failure to create such Lien would create a default under the terms
of the instrument governing such Indebtedness); provided, that neither
the Company nor any of its Subsidiaries may create, assume, incur or
suffer to exist any Lien upon any of its property or assets to secure
any Indebtedness set forth in Schedule 7.1. or as is otherwise
described in the Financial Statements that is hereafter renewed,
refunded, extended or refinanced,
(d) Liens incurred in connection with the borrowing of money not
otherwise permitted provided that immediately after creation of such
Lien, the total amount of Indebtedness secured by Liens permitted by
this Agreement will not exceed 15% of the shareholders' equity in the
Company; provided, further, that (A) nothing in this subsection (d)
shall be deemed to permit any transaction which would otherwise be
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prohibited by this Agreement and (B) shareholders' equity shall, for
the purpose of all calculations thereof under this subsection (d) only,
be reduced by the amount by which the Company's intangible assets
exceed five percent (5%) of shareholders' equity,
(e) Liens (other than those permitted by subsections (a) through (d)
of this Section 7.3.) securing Indebtedness in an aggregate principal
amount at any time outstanding not exceeding ONE HUNDRED THOUSAND AND
NO/100 DOLLARS ($100,000.00) for the Company taken as a whole, and
(f) Liens on property of the Company other than those permitted by
subsections (a) through (e) of this Section 7.3., provided that the
Indebtedness incurred under this Agreement shall be equally and ratably
secured, on a pari passu and pro rata basis, with any and all
Indebtedness hereinafter incurred by the Company and secured by such
Lien.
Section 7.4. Investments. Neither the Company nor any Subsidiary shall
make or permit to remain outstanding any loan or advance to, or own, purchase or
acquire any stock, obligations or securities of, or any other interest in, or
make any capital contribution to, any Person, except that the Company and any
Subsidiary may:
(a) invest in Permitted Investments and, to the extent permitted by
Section 7.7., Gross Real Estate Investments and, to the extent
permitted by Section 7.8., Construction Investments;
(b) make or permit to remain outstanding loans and advances to any
Subsidiary;
(c) own, purchase or acquire stock, obligations or securities of, or
any other interest in, a Subsidiary or another Person which immediately
after such purchase or acquisition will be a Subsidiary;
(d) acquire and own stock, obligations or securities, or other
interests, received in settlement of debts (created in the ordinary
course of business) owing to the Company or any Subsidiary, provided,
that such stock, obligations, securities or other interests shall be
carried on the books of the Company at the lesser of book value or fair
market value, such valuation to be as determined by the board of
trustees of Meditrust in good faith, in the case of any debt in an
aggregate principal amount equal to or exceeding ONE MILLION AND NO/100
DOLLARS ($1,000,000.00);
(e) make or permit to remain outstanding travel and other like
advances to officers and employees in the ordinary course of business;
and
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(f) own, purchase or acquire stock, obligations or securities of any
Person, including, without limitation, making mortgage loans, entering
into sale and leaseback transactions not otherwise prohibited by this
Agreement, or investing in partnerships, to the extent that any such
investments are in the ordinary course of business and not prohibited
by Meditrust's Declaration of Trust, as the same may from time to time
be amended.
Section 7.5. ERISA. Neither the Company nor any member of the Controlled
Group shall terminate any Plan so as to result in any material liability to
the Company or any Subsidiary to the PBGC or permit to exist any occurrence of
any "reportable event" (as defined in Title IV of ERISA), or any other event or
condition, which presents a material risk of such a termination by the PBGC of
any Plan.
Section 7.6. Fiscal Year. The Company shall not change its fiscal year
end.
Section 7.7. Gross Real Estate Investments. The Company shall not have
Gross Real Estate Investments relating to a single Operator which exceed, in
the aggregate, twenty-five percent (25%) of the Company's Gross Real Estate
Investments; provided, however, that:
(i) Gross Real Estate Investments in Facilities owned by Mediplex
cannot exceed the lesser of FOUR HUNDRED FIFTY MILLION AND
NO/100 DOLLARS ($450,000,000.00) or thirty-five percent (35%)
of the Company's Gross Real Estate Investments.
Notwithstanding the foregoing, if, at any time as the result
of a sale of Mortgages at a public or private sale, the Gross
Real Estate Investments relating to Facilities owned by
Mediplex as set forth above shall exceed thirty-five percent
(35%) of the Company's Gross Real Estate Investments, the
Company shall have one hundred twenty (120) days in which to
reduce the amount of Gross Real Estate Investments relating
to Facilities owned by Mediplex to an amount not more than
thirty-five percent (35%) of the Company's Gross Real Estate
Investments.
(ii) Gross Real Estate Investments relating to Life Care Centers
of America, Inc. (exclusive of Gross Real Estate Investments
relating to
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Health Asset Realty Trust ("HART")) may not exceed
twenty-five percent (25%) of Gross Real Estate Investments;
provided, however, that Gross Real Estate Investments
relating to either Life Care Centers of America, Inc. or HART
may not exceed thirty-five percent (35%) of the Company's
Gross Real Estate Investments.
Section 7.8. Construction Investments. The Company shall not permit its
Construction Investments to exceed seventeen and one-half percent (17.5%) of its
Gross Real Estate Investments. In addition, the Company shall not make a
Construction Investment for a Facility unless (i) there is included in the terms
thereof an agreement for the conversion of the Company's interests in the
Facility upon the completion thereof into full ownership, a mortgage interest or
majority partnership interest and (ii), if a mortgage interest, the Company
shall receive or retain a first Lien in such Facility and otherwise satisfy all
Legal Requirements.
Section 7.9. Interest Rate Protection. The Company shall not permit more
than twenty-five percent (25%) of its consolidated Total Capital to bear
interest at other than fixed rates; provided, however, that if and to the extent
that any of such consolidated Total Capital is subject to an interest rate
protection agreement approved by the Agents (which approval shall not be
unreasonably withheld, conditioned or delayed), such consolidated Total Capital
shall be deemed to bear interest at a fixed rate.
Section 7.10. Dividends. Meditrust shall not pay or declare any Dividend
on any of its of beneficial interest or make any other distribution on account
thereof, or redeem or otherwise acquire, directly or indirectly, any of its
shares of beneficial interest if such action by Meditrust would constitute an
Event of Default or Default, or an event of default or default under any other
material agreement to which Meditrust is a party. This Section 7.10. shall not
apply to the payment or distribution made in the form of shares of beneficial
interest of Meditrust.
Section 7.11. Amendment of Declaration of Trust. Meditrust shall not amend
its Declaration of Trust except if (a) such amendment is required by applicable
law or (b) the Agents consent to such amendment, which consent shall not be
unreasonably withheld. In the event of any such amendment, Meditrust shall
promptly forward copies thereof to the Banks. Notwithstanding the foregoing,
Meditrust may amend its Declaration of Trust in the manner set forth in the
proxy statement issued in connection with its 1992 and 1994 annual meetings.
Section 7.12. Future Leases. The Company shall not become a party to any
Facility Lease after the Closing Date except for a Facility Lease where the
obligations of the lessee to make payments
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under such Facility Lease cover fully the Company's obligations to make
principal, interest and other payments on the Indebtedness relating to the
Facility which is the subject of such Facility Lease, if any, including, without
limitation, all interest rate adjustments or escalations, prepayment penalties
and similar payments.
Section 7.13. Leases. The Company shall not create or suffer to exist any
obligations for the payment of rent by the Company for any property under leases
(other than capitalized lease obligations included as Indebtedness of the
Company) except for the following:
(i) ground leases for Facilities existing on the Closing Date;
(ii) ground leases for terms no less than ten (10) years in connection with
sale/leaseback transactions of Facilities;
(iii) office leases in the ordinary course of business; and
(iv) office equipment and automobile leases in the ordinary course of
business.
Section 7.14. Prohibited Transactions. The Company shall not engage in any
prohibited transactions as such term is defined in Section 857(b)(6) of the Code
(except that the Company may sell, transfer or otherwise dispose of a Facility
within four (4) years after the acquisition thereof so long as (i) such
disposition, including the excise taxes attributable thereto, will not have a
Material Adverse Effect and (ii) the trustees of Meditrust have theretofore made
a good-faith determination that such disposition is in the best interests of the
Company, nor shall the Company incur any material liability for excise taxes
pursuant to Section 4981 of the Code.
Section 7.15. Mergers. The Company shall not merge or consolidate with, or
sell, assign, lease or otherwise dispose of (whether in one transaction or a
series of transactions) all or substantially all of its properties and assets
(whether now owned or hereafter acquired) to any Person, except that any
Subsidiary may dispose of its properties and assets (subject to the limitations
of Section 7.14. hereof) to, Meditrust or any Subsidiary and except that any
Company may merge or consolidate with any other Person if in such transaction
the Company is the surviving entity.
Section 7.16. Change in Business. The Company shall not make any material
change in the nature of its business as conducted as of the Closing Date.
Section 7.17. Issuance of Stock by Subsidiaries. The Company shall not
permit any Subsidiary to issue, sell or dispose of any shares of its stock of
any class (including any warrants, rights or options to purchase or otherwise
acquire stock or other securities exchangeable for or convertible into stock) or
any of its partnership or other equity interests, except to Meditrust, the
Company or any
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wholly-owned Subsidiary, and except (i) for the purpose of qualifying directors
and (ii) to the extent that holders of minority interests may be entitled to
purchase stock by reason of validly pre-existing preemptive rights.
Section 7.18. Sale of Stock and Indebtedness. The Company shall not sell
or otherwise dispose of, or part with control of, any shares of stock or
Indebtedness of any Subsidiary, except to the Company or another Subsidiary, and
except that all shares of stock and Indebtedness of any Subsidiary at the time
owned by or owed to the Company and any Subsidiaries may be sold as an entirety
for a cash consideration which represents the fair value (as determined in good
faith by the trustees of Meditrust) at the time of sale of the shares of stock
and such Indebtedness; provided, that the assets of such Subsidiary do not
constitute, when aggregated with all sales during the four (4) most recently
completed fiscal quarters, ten percent (10%) of the Company's consolidated total
assets (as defined by GAAP) or ten percent (10%) of the Company's Operating Cash
Flow; and provided further, that at the time of such sale, such Subsidiary shall
not own, directly or indirectly, any shares of stock or Indebtedness of any
other Subsidiary (unless all of the shares of stock and Indebtedness of such
other Subsidiary are being sold simultaneously as permitted by this Section
7.18.).
Section 7.19. Transactions with Affiliates. The Company shall not directly
or indirectly, purchase, acquire or lease any property from, or sell, transfer
or lease any property to, exchange any property with, render any service to or
otherwise deal with, (i) any Affiliate, (ii) any Person owning, beneficially or
of record, directly or indirectly, either individually or together with all
other Persons to whom such Person is related by blood, adoption or marriage,
equity securities of the Company aggregating ten percent (10%) or more of the
voting power of the Company or (iii) any Person related by blood, adoption or
marriage to any Person described or coming within the provisions of clause (i)
or (ii) of this Section 7.19., provided that the Company may sell to or purchase
(within the limitations of Section 7.19.) from any such Person shares of equity
securities of, or other interests in, the Company; provided, however, that this
Section shall not prohibit transactions which are in the ordinary course of
business of the Company or its Subsidiaries, and which are made upon fair and
reasonable terms no less favorable to the Company or its Subsidiaries involved
than could be obtained in a comparable arm's-length transaction with a Person
which is not an Affiliate.
Section 8. FINANCIAL COVENANTS.
The Company covenants and agrees that from the date hereof, until the
payment and performance in full of the Obligations, unless the Banks otherwise
consent in writing:
Section 8.1. Cash Flow Coverage. Meditrust shall not permit the ratio of
(x) its Operating Cash Flow plus its Interest Expense to (y) its Interest
Expense to be less than 2.0 to 1.0 at the end of each
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fiscal quarter. Meditrust's compliance with said ratio shall be calculated on a
year-to-date basis.
Section 8.2. Modified Cash Flow Coverage. Meditrust shall not permit the
ratio of (x) its Modified Operating Cash Flow plus its Interest Expense to (y)
its Interest Expense plus its Dividends plus its Balloon Payments to be less
than 1.0 to 1.0 at the end of each fiscal quarter. Meditrust's compliance with
said ratio shall be calculated on a year-to-date basis.
Section 8.3. Total Liabilities to Tangible Net Worth. Meditrust shall not
permit the ratio of (x) its Total Liabilities to (y) its Tangible Net Worth to
be greater than 1.75 to 1.0 at any time.
Section 8.4. Tangible Net Worth. Meditrust shall maintain a Tangible Net
Worth at all times of at least FIVE HUNDRED MILLION AND NO/100 DOLLARS
($500,000,000.00) plus seventy-five percent (75%) of the net amount received by
Meditrust from the sale of equity securities, the exercise of warrants and the
conversion of debentures to equity after the Closing Date.
Section 8.5. Establishment of Covenants. The Company acknowledges that the
foregoing covenants were established by the Company and the Banks on the basis
of financial information and forecasts provided to the Banks by the Company in
connection with the Banks' evaluation and underwriting of the Line of Credit
after leaving a margin in favor of the Company which the Company and the Banks
have mutually agreed is fair. Accordingly, the Company and the Banks have
mutually agreed that the Company's failure to comply with the express terms of
any financial covenant shall be deemed material for the purposes of this
Agreement.
Section 9. THE AGENTS
Section 9.1. Appointment, Powers and Immunities. Each Bank and each
subsequent holder of the Notes and the Letter of Credit Participations hereby
irrevocably appoints and authorizes the Agents to act as their agents under this
Agreement and the Other Documents with such powers as are specifically delegated
to the Agents by the terms of this Agreement and the Other Documents together
with such other powers as are reasonably incidental thereto. The Agents shall
have no duties or responsibilities except those expressly set forth in this
Agreement and the Other Documents and shall not be trustees for any Bank. The
Agents shall not be responsible to the Banks for any recitals, statements,
representations or warranties contained in this Agreement or the Other Documents
or in any certificate or other document referred to or provided for in, or
received by any of them under, this Agreement or the Other Documents, or for the
value, validity, effectiveness, genuineness, enforceability or sufficiency of
this Agreement, the Other Documents or any other document referred to or
provided for herein or therein or for the collectibility of the Loans or the
Letter of Credit Participations or for any failure by the Company to perform any
of its obligations under this Agreement, the
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Notes or the Other Documents. The Agents may employ agents and attorneys-in-fact
and shall not be answerable, except as to money or securities received by them
or their authorized agents, for the negligence or misconduct of any such agents
or attorneys-in-fact selected by them with reasonable care. Neither the Agents
nor any of their directors, officers, employees or agents shall be liable or
responsible for any action taken or omitted to be taken by them under this
Agreement, or under the Other Documents or in connection herewith or therewith,
except for their own gross negligence or willful misconduct.
Section 9.2. Reliance by Agents. The Agents shall be entitled to rely upon
any certification, notice or other communication (including any thereof by
telephone, telex, telegram or cable) believed by the Agents to be genuine and
correct and to have been signed or sent by or on behalf of the proper Person or
Persons, and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Agents. As to any matters not
expressly provided for by this Agreement or the Other Documents, the Agents
shall in all cases be fully protected in acting, or in refraining from acting,
under this Agreement or the Other Documents in accordance with instructions
signed by the Banks, and such instructions of the Banks and any action taken or
failure to act pursuant thereto shall be binding on all of the Banks. The Agents
shall be entitled to take, and to rely on, advice of counsel concerning all
matters pertaining to their rights and duties under this Agreement and the Other
Documents. The Agents may utilize the services of such Persons as the Agents in
their sole discretion may reasonably determine.
Section 9.3. Payments.
(a) A payment by the Company to the Agents under this Agreement, the
Notes or any of the Other Documents for the account of any Bank shall constitute
a payment to such Bank. Except as otherwise provided in this Agreement, the
Agents agree promptly to distribute to each Bank such Bank's pro rata share of
payments received by the Agents for the account of the Banks except as otherwise
expressly provided in this Agreement, the Notes or any of the Other Documents.
(b) If in the opinion of the Agents, the distribution of any amount
received by the Agents in such capacity hereunder, under this Agreement, the
Notes or any of the Other Documents could reasonably be expected to involve the
Agents in liability, the Agents may refrain from making distribution until the
Agents' right to make distribution shall have been adjudicated by a court of
competent jurisdiction. If a court of competent jurisdiction shall adjudge that
any amount received and distributed by the Agents is to be repaid, each Person
to whom any such distribution shall have been made shall either repay to the
Agents its proportionate share of the amount so adjudged to the repaid or shall
pay over the same in such manner and to such Persons as shall be determined by
such court.
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Section 9.4. Holders. The Agents may deem and treat the holder of any
Letter of Credit Participation as the absolute owner for all purposes hereof
until the Agents shall have been furnished in writing with a different name by
such payee or by a subsequent holder, assignee or transferee.
Section 9.5. Events of Default. The Agents shall not be deemed to have
knowledge of the occurrence of any Default or Event of Default (other than the
nonpayment of principal of or interest on the Loans or the Reimbursement
Obligations) unless the Agents have received notice from a Bank or the Company
specifying such Event of Default or Default and stating that such notice is a
"Notice of Default." In the event that the Agents receive such a "Notice of
Default" or in the event of any nonpayment of principal or interest on the Loans
or the Reimbursement Obligations, the Agents shall give prompt notice thereof to
the Banks and shall take such action with respect to such Event of Default or
Default as shall be directed by the Majority Banks.
Section 9.6. Rights as a Bank. With respect to its Commitment, its Letter
of Credit Participation and the Loans made by it, each Agent in its capacity as
a Bank hereunder shall have the same rights and powers hereunder as any other
Bank and may exercise the same as though it were not acting as an Agent, and the
term "Bank" or "Banks" shall, unless the context otherwise indicates, include
the Agents in their individual capacities. The Agents and their Bank Affiliates
may (without having to account therefor to any Bank) accept deposits from, lend
money to and generally engage in any kind of banking, trust or other business
with the Company, as if they were not acting as the Agents, and the Agents may
accept fees and other consideration from the Company for services in connection
with this Agreement or any of the Other Documents or otherwise without having to
account for the same to the Banks.
Section 9.7. Indemnification. The Banks shall indemnify the Agents (to the
extent not reimbursed by the Company hereunder), ratably in accordance with
their respective Commitments and/or Letter of Credit Participations, for any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind and nature whatsoever which
may be imposed on, incurred by or asserted against the Agents in their
capacities as the Agents under this Agreement in any way relating to or arising
out of this Agreement or any of the Other Documents or any other document
contemplated hereby or thereby or referred to herein or therein (including,
without limitation, the costs and expenses which the Company is obligated to pay
under Section 12.4. hereof, but excluding, unless an Event of Default has
occurred and is continuing, normal administrative costs and expenses incident to
the performance of their agency duties hereunder) or the enforcement of any of
the terms of this Agreement, the Other Documents or of any such other documents;
provided, however, that no Bank 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.
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Section 9.8. Non-Reliance on Agents and other Banks. Each Bank agrees
that it has, independently and without reliance on the Agents or any other
Bank, and based on such documents and information as it has deemed
appropriate, made its own credit analysis of the Company and decision to
enter into this Agreement and that it will, independently and without
reliance upon the Agents or any other Bank, 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 this
Agreement or the Other Documents. The Agents shall not be required to keep
themselves informed as to the performance or observance by the Company of
this Agreement or the Other Documents or any other document referred to or
provided for herein or therein or to inspect the properties or books of the
Company or any Subsidiary. Except for (i) notices, reports and other
documents and written information delivered by the Company to the Agents
hereunder or under the Other Documents (copies of all of which the Agent
shall immediately distribute to the Banks upon receipt by the Agents), or
required to be delivered by the Company to all of the Banks and (ii)
notices, reports and other documents required to be delivered by the Agents
hereunder to the Banks, the Agents shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning the financial condition or business of the Company or any
Subsidiary, which may come into the possession of the Agents or any of
their Bank Affiliates.
Section 9.9. Failure to Act. Except for action expressly required of
the Agents hereunder or under the Other Documents, the Agents shall in all
cases be fully justified in failing or refusing to act hereunder or
thereunder unless they shall be indemnified to their satisfaction by the
Banks against any and all liability and expense that may be incurred by
them by reason of taking or continuing to take any such action.
Section 9.10. Resignation of Agents. Either Agent may resign at any
time by giving sixty (60) days prior written notice thereof to the other
Agent, the Banks and the Company and, unless otherwise approved by the
Majority Banks, the Administrative Agent shall resign within thirty (30)
days after the date on which its Commitment (plus the Commitments of any of
its Bank Affiliates) is reduced to less than EIGHT MILLION AND NO/100
DOLLARS ($8,000,000.00); provided, however, that if at the time of such
resignation, such Agent should be the only Agent then remaining, such
resignation shall not be effective until the appointment of a successor
Agent as provided for herein. Upon any such resignation, the remaining
Agent shall be the sole Agent and shall serve as the Administrative Agent.
If upon any such resignation, such Agent should be the only Agent remaining
and decline to serve as the Administrative Agent, the Majority Banks shall
have the right to appoint a successor Agent (including an Agent to serve as
the Administrative Agent). Unless an Event of Default shall have occurred
and be continuing, such successor Agent shall be acceptable to the Company.
If a resigning Agent should then be serving as the Administrative Agent,
the Majority Banks shall either designate the remaining Agent or any new
Agent appointed as aforesaid to serve as the Administrative Agent. If no
successor Agent shall have been so appointed by the Banks as aforesaid and
shall have accepted such
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appointment within thirty (30) days after the retiring Agent's giving of
notice of resignation, then the retiring Agent may, on behalf of the Banks,
appoint a successor Agent, which shall be a bank or financial institution
of recognized standing. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations hereunder as an Agent. After any retiring
Agent's resignation, the provisions of this Agreement, the Notes and the
Other Documents shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by the Agent while it was acting as an
Agent.
Section 9.11. Cooperation of Banks. Each Agent shall provide the other
Banks with such information and documentation as such other Bank shall
reasonably request relating to the performance of its duties hereunder,
including, in the case of the Administrative Agent, all information
relative to the outstanding balance of principal, interest and other sums
owed to such other Banks by the Company, and shall cooperate with the other
Banks with respect to any and all collections and/or foreclosure
proceedings at any time commenced against the Company or any Subsidiary or
otherwise in respect of any collateral on behalf of the Banks.
Section 9.12. Actions by Agents. In case one or more Events of Default
have occurred and shall be continuing, and whether or not acceleration of
the Obligations shall have occurred, the Agents shall, if (a) so requested
by the Majority Banks and (b) the Majority Banks have provided to the
Agents such additional indemnities and assurances against expenses and
liabilities as the Agents may reasonably request, proceed to enforce the
provisions of any of the Other Documents authorizing the sale or other
disposition all or any part of any collateral and exercise all or any such
other legal and equitable and other rights or remedies as it may have in
respect of any such collateral. The Majority Banks may direct the Agents in
writing as to the method and the extent of any such sale or other
disposition or other rights or remedies as it may have in respect of such
collateral, the Banks hereby agreeing to indemnify and hold the Agents
harmless from all liabilities incurred in respect of all actions taken or
omitted in accordance with such directions; provided, however, that the
Agents need not comply with any such direction to the extent that the
Agents reasonably believe the Agents' compliance with such direction to be
unlawful or commercially unreasonable in any applicable jurisdiction. In
any event, the Banks agree, as among themselves, that the Agents shall not,
without the consent or approval of the Majority Banks, (i) consent or agree
to any amendment or waiver of any material term, condition or covenant
contained in this Agreement or the Other Documents (other than those
provisions that may only be amended or waived with the unanimous approval
of the Banks under Section 9.14), (ii) declare any Event of Default or
determine that a Material Adverse Effect has occurred, (iii) exercise any
right or remedy with respect to the acceleration or collection of the
Obligations or (iv) take any other action which requires the consent or
approval of the Banks under this Agreement or the Other Documents.
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Section 9.13. Security.
(a) The Agents acknowledge to the other Banks that they are
acting in an agency capacity hereunder and that any liens and security
interests in any collateral secure the Obligations of the Company owing to
all of the Banks.
(b) Notwithstanding anything to the contrary set forth herein,
each of the parties hereto acknowledges and agrees that the respective
rights, benefits and privileges of the Agents and the Banks under each of
the Other Documents and all other instruments, documents and agreements
providing the benefit of any collateral security or guarantees for the
prompt payment and performance of the Obligations are for the ratable and
mutual benefit of the Banks, and each of the rights, benefits and
privileges thereunder shall be exercised (or not exercised) solely by the
Agents but only at the direction and with the consent and approval of the
Majority Banks in accordance with this Section 9.
Section 9.14. Required Approval. Any action which requires the consent
or approval of the Banks under this Agreement may be taken upon the
affirmative consent or approval of the Majority Banks to be effective;
provided, however, that the following action shall require the unanimous
affirmative approval of all of the Banks:
(i) any increase in the amount of the Combined Commitment Amount
or the aggregate amount of Letters of Credit which may be issued hereunder;
(ii) any amendment of the calculation of the Borrowing Base which
would have the effect of increasing credit availability thereunder;
(iii) any extension of the Scheduled Maturity Date or the Letter of
Credit Termination Date;
(iv) any increase or decrease in any Bank's Commitment Percentage
or Commitment, other than in connection with assignments under Section 11
hereof;
(v) any change in the definitions of LIBOR, LIBOR Margin and
Prime Rate;
(vi) the release of any collateral or the release or discharge of
any Person which is a party to this Agreement, the Notes or the Other
Documents except as contemplated by this Agreement;
(vii) any decrease in any Fees, interest (other than resulting from
fluctuations in the Prime Rate), indemnities or other reimbursements
payable to the Banks;
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(viii) any extension, waiver or excuse of any payment of any of the
Obligations at their due date, whether by acceleration or otherwise;
(ix) any amendment to Section 8 of this Agreement;
(x) any amendment to Section 1.87. or Section 9 of this Agreement
or any other provision of this Agreement providing for the respective
voting rights of the Banks; or
(xi) the issuance of a Letter of Credit under a separate
Reimbursement Agreement containing or providing for terms, conditions,
covenants or Fees less favorable to the Banks than those set forth in this
Agreement or the Meditrust-Illinois Reimbursement Agreement.
Section 9.15. Amendment. The Company hereby agrees that the foregoing
provisions of this Section 9 (other than Section 9.14.) constitute an
agreement among, and solely for the benefit of, the Banks and the Agents,
and the Banks and the Agents acknowledge that the Company is not a party to
or bound by such foregoing provisions and that any and all of the
provisions of this Section 9 other than Section 9.14. may be amended at any
time by the Banks and the Agents as provided herein without the consent or
approval of, or notice to, the Company (other than the requirement of
notice to the Company of the resignation of an Agent).
Section 9.16. Questionnaire. In order to assist the Agents in the
administration and performance of their duties under this Agreement, each
Bank hereby agrees to complete and deliver to each Agent a questionnaire in
substantially the form of Exhibit H attached hereto (an "Administrative
Questionnaire").
Section 10. DEFAULT
Section 10.1. Events of Default. The occurrence and continuance of any
of the following events after any applicable cure period shall constitute a
default under this Agreement, the Notes and the Other Documents (an "Event
of Default"):
(a) the Company shall fail to pay when due and payable, whether
at the due date thereof, at a date fixed for prepayment thereof, by
acceleration thereof or otherwise, (i) any outstanding principal amount of
any Loan; (ii) any amount of accrued and unpaid interest thereon; (iii) any
of the Reimbursement Obligations; or (iv) any fees, expenses or other
amounts payable under this Agreement, the Notes or the Other Documents and,
in the case of clauses (ii), (iii) and (iv) above, such default shall
continue unremedied for (5) Business Days from the date specified for
payment; or
(b) the Company shall fail to perform any term, covenant or
agreement contained in Section 7 of this Agreement; or
(c) the Company shall fail to perform any other term, covenant or
agreement contained in this Agreement (other than in respect of terms,
covenants or agreements covered elsewhere in this
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Section 10) and such non-performance shall continue unremedied for thirty
(30) days after written notice of such non-performance shall have been
received or deemed received by Meditrust on behalf of the Company from the
Agents; or
(d) any written representation or warranty of the Company, made
in or in connection with this Agreement, the Notes or the Other Documents
or in any certificate or report or any other document or instrument
delivered hereunder or thereunder, shall prove to have been false in any
material respect upon the date when made or deemed to have been made; or
(e) any monetary default (unless duly waived in writing by the
obligee) shall occur with respect to any Unsecured Indebtedness of the
Company in excess of FIVE MILLION AND NO/100 DOLLARS ($5,000,000.00) or any
amount of recourse secured Indebtedness of the Company under any agreements
under which any Indebtedness may be issued by the Company and such default
shall continue for more than the grace period, if specified therein, after
all required notices have been given, and any other default under such
agreements if the effect of such other default under such agreements is to
accelerate the maturity of such Indebtedness or to permit the holder
thereof (or any representative on behalf of such holder) to cause the same
to become due prior to its stated maturity or if any such Indebtedness
shall not be paid when due or accelerated and such default shall continue
for more than the period of grace, if any, therein specified, all required
notices having been given or if the Company fails to make payment within
five (5) days after demand is made for payment of any Indebtedness which is
due on demand; or
(f) one or more final judgments or orders for the payment of
money which would have a Material Adverse Effect shall be rendered against
the Company or any Subsidiary and either (i) enforcement proceedings shall
have been commenced by any creditor upon such judgment or order, or (ii) a
stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect for any period of ten (10)
consecutive Business Days; or
(g) Meditrust or any of its Subsidiaries having assets which in
the aggregate exceed FIFTEEN MILLION AND NO/100 DOLLARS ($15,000,000.00)
shall commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official or it or any substantial part of its property, or
shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against it, or shall make a general assignment for the benefit of
creditors or shall fail generally to pay its debts as they become due, or
shall take any action to authorize any of the foregoing; or
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(h) an involuntary case or other proceeding shall be commenced
against Meditrust or any of its Subsidiaries having assets which in the
aggregate exceed FIFTEEN MILLION AND NO/100 DOLLARS ($15,000,000.00)
seeking liquidation, reorganization or other relief with respect to it or
its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial
part of its property, or an order for relief shall be entered against the
Company under the federal bankruptcy laws as now or hereafter in effect and
remain undischarged for ninety (90) days; or
(i) there shall have occurred and be continuing, thirty (30) days
after knowledge or notice thereof shall have been given to Meditrust on
behalf of the Company by the Agents, any event which would allow for the
termination of any Plan and the then current value of such Plan's benefits
guaranteed under Title IV of ERISA exceeds the then current fair market
value of such Plan's assets allocable to such benefits by more than ONE
MILLION AND NO/100 DOLLARS ($1,000,000.00) (or in the case of such a
termination event involving the withdrawal of a substantial employer, the
withdrawing employer's proportionate share of such excess exceeds such
amount); or
(j) the Company should fail to terminate the Commitments and
prepay the entire principal amount due and payable under this Agreement,
the Notes and the Other Documents within forty-five (45) days after any
sale, transfer, assignment or other permanent disposition (other than the
contemplated merger of The Mediplex Group, Inc. with a subsidiary of Sun
Healthcare Group, Inc.) of an Operator that represents more than twenty
percent (20%) of the Company's Gross Real Estate Investments, such
percentage being based on the Company's most recent Borrowing Report and
quarterly Financial Statements; or
(k) the Company should fail to terminate the Commitments and
prepay the entire principal amount due and payable under this Agreement,
the Notes and the Other Documents within forty-five (45) days after the
accumulation of fifteen percent (15%) or more of the voting stock of
Meditrust by a Person or group of affiliated Persons; or
(l) the occurrence of an "event of default" (after giving effect
to any applicable grace period) under any of the Other Documents, as such
term is defined or used therein.
Section 10.2. Remedies. Upon the occurrence of an Event of Default,
the Agents shall (i) if requested by Banks having more than fifty percent
(50%) in aggregate amount of the Commitments, by notice to Meditrust on
behalf of the Company, terminate the obligation of the Banks to make
Revolving Loans or to issue Letters of Credit and such obligations shall
thereupon terminate, and (ii) if requested by Banks holding Notes
evidencing more than fifty percent (50%) in aggregate principal amount of
the Revolving Loans, by notice to Meditrust on behalf of the Company
declare the Notes (together with accrued
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interest thereon) to be, and the Notes shall thereupon become, immediately
due and payable without presentment, demand, protest or other notice of any
kind, all of which are hereby waived by the Company; provided that in the
case of any of the Events of Default specified in subsection (g) or (h) of
Section 10.1 hereof with respect to the Company, without any notice to the
Company or any other act by the Agents or the Banks, the obligation of the
Banks to make Revolving Loans and to issue Letters of Credit shall
thereupon terminate and the Notes (together with accrued interest thereon)
shall become immediately due and payable without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Company. The rights and the remedies herein provided shall be cumulative
and not exclusive of any rights or remedies provided by law, in equity or
in the Other Documents.
The Company acknowledges and agrees that, at the time of the exercise
by the Banks of its remedies under this Section 10.2., there may be one or
more Letters of Credit issued and outstanding under which, in the event of
a Drawing thereunder, the Administrative Agent will be required to honor
such Drawing. In addition to any of the other rights and remedies of the
Banks in respect of such Drawing contained in this Agreement or any of the
Other Documents, the amount of any such Drawing and any Reimbursement
Obligation created thereby shall become immediately due and payable without
presentment, demand, protest or other notice of any kind.
Section 11. ASSIGNMENT
Section 11.1. Assignment.
(a) Each Bank may assign to one or more Persons all or a portion
of its interests, rights and obligations under this Agreement (including
all or a portion of its Commitment, the same portion of its Letter of
Credit Participation and the same portion of the Loans at the time owing to
it); provided, however, that (i) except in the case of an assignment to a
Bank, the Administrative Agent and Meditrust on behalf of the Company must
give their prior written consent to such assignment (which consent shall
not be unreasonably withheld although in the case of Meditrust it shall be
reasonable for consent to be withheld, among other reasons, if the proposed
assignment is to a competitor of Meditrust or if Meditrust, in its
reasonable discretion, believes that such assignment would increase its
costs under Section 2.5.6. or 12.6. hereof); (ii) each such assignment
shall be of a constant, and not a varying, percentage of all the assigning
Bank's interests, rights and obligations under this Agreement; (iii) the
amount of the Commitment, the Letter of Credit Participations and the Loans
of the assigning Bank subject to each such assignment (determined as of the
date of the Assignment and Acceptance with respect to such assignment is
delivered to the Agents) shall not be less than EIGHT MILLION AND NO/100
DOLLARS ($8,000,000.00); (iv) the parties to each such assignment shall
execute and deliver to the Administrative Agent an assignment and
acceptance in the form of Exhibit I attached hereto (the "Assignment and
Acceptance") and a
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processing and recordation fee in the amount of THREE THOUSAND AND NO/100
DOLLARS ($3,000.00); (v) the assignee shall be a bank or financial
institution of recognized standing and in the business of making the types
of loans contemplated in this Agreement and (vi) the assignee, if it shall
not be a Bank, shall deliver to the Administrative Agent an Administrative
Questionnaire. Upon such execution, delivery, acceptance and recording
pursuant to Section 11.2. hereof, from and after the effective date
specified in each Assignment and Acceptance, which effective date shall be
at least five (5) Business Days after the execution thereof, (A) the
assignee thereunder shall be a party hereto and, to the extent of the
interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Bank under this Agreement (including, without limitation,
the benefit of the cost protection provisions) to the same extent as if
they were a Bank; and (B) the assigning Bank thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all or the remaining portion of an
assigning Bank's interests, rights and obligations under this Agreement,
such Bank shall cease to be a party hereto but shall continue to be
entitled to the benefits of any indemnity, waiver, release or limitation of
liability contained herein, as well as to any Fees accrued for its account
and not yet paid).
(b) By executing and delivering an Assignment and Acceptance, the
assigning Bank thereunder and the assignee thereunder shall be deemed to
confirm to and agree with each other and the other parties hereto as
follows: (i) such assigning Bank warrants that it is the legal and
beneficial owner of the interest being assigned thereby free and clear of
any adverse claim and that its Commitment, its Letter of Credit
Participations and the outstanding balances of its Loans, in each case
without giving effect to assignments thereof which have not become
effective, are as set forth in such Assignment and Acceptance; (ii) except
as set forth in subsection (i) above, such assigning Bank makes no
representation or warranty and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
this Agreement, or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, the Notes, the Other
Documents or any other agreement, document or instrument furnished pursuant
hereto or thereto; (iii) such assignee represents and warrants that it is
legally authorized to enter into such Assignment and Acceptance; (iv) such
assignee confirms that it has received a copy of this Agreement, together
with copies of the most recent Financial Statements delivered pursuant to
Section 6.1. hereof and such other documents and information as it has
deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (v) such assignee will independently
and without reliance upon the Agents, such assigning Bank or any other Bank
and based on such documents and information as it shall deem appropriate at
the time, continue to make its own credit decisions in taking or not taking
action under this Agreement; (vi) such assignee appoints and
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authorizes the Agents to take such action as agent on its behalf and to
exercise such powers under this Agreement as are delegated to the Agents by
the terms hereof, together with such powers as are reasonably incidental
thereto; and (vii) such assignee agrees that it will perform in accordance
with their terms all the obligations which by the terms of this Agreement
are required to be performed by it as a Bank.
Section 11.2. Maintenance of a Register. The Administrative Agent
shall maintain at one of its principal offices a copy of each Assignment
and Acceptance delivered to it and a register for the recordation of the
names and addresses of the Banks, and the Commitment, the Letter of Credit
Participations and the principal amount of the Loans owing to each Bank
pursuant to the terms hereof from time to time (the "Register"). The
entries in the Register shall be conclusive in the absence of manifest
error and the Company, the Agents and the Banks may treat each person whose
name is recorded in the Register pursuant to the terms hereof as a Bank
hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Company and any Bank, at any reasonable
time and from time to time upon reasonable prior notice. The Agents shall
also be authorized to amend, modify and substitute Schedule 1.22. attached
hereto from time to time to properly reflect the Commitment Percentages of
the Banks under this Agreement.
Section 11.3. Questionnaire. Upon its receipt of a duly completed
Assignment and Acceptance executed by an assigning Bank and an assignee, an
Administrative Questionnaire completed in respect of the assignee (unless
the assignee shall already be a Bank hereunder), the processing and
recordation fee referred to in Section 11.1. above and, if required, the
written consent of the Agents and/or the Company to such assignment, the
Administrative Agent shall (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register, and (iii) give
prompt notice thereof to the Banks and Meditrust on behalf of the Company.
Section 11.4. Sale of Participations. Each Bank may, without the
consent of the Company or the Agents, sell participations to one or more
banks, financial institutions or other entities in all or a portion of its
rights and obligations under this Agreement (including all or a portion of
its Commitment, the same portion of its Letter of Credit Participations and
the same portion of the Loans owing to Bank); provided, however, that (i)
such Bank's obligations under this Agreement shall remain unchanged; (ii)
such Bank shall remain solely responsible to the other parties hereto for
the performance of such obligations; (iii) the participating banks,
financial institutions or other entities shall be entitled to the benefit
of the cost protection provisions contained in this Agreement to the same
extent as if they were Banks although such participating banks may not
increase any costs which shall be payable by the Company; and (iv) the
Company, the Agents and the other Banks shall continue to deal solely and
directly with such Bank in connection with such Bank's rights, interests
and obligations under this Agreement, and such Bank shall retain the sole
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right to enforce the obligations of the Company relating to the Loans and
to approve any amendment, modification or waiver of any provision of this
Agreement (other than amendments, modifications or waivers decreasing any
Fees payable hereunder or the amount of principal of or the rate at which
interest is payable on the Loans, extending any scheduled principal payment
date or date fixed for the payment of interest on the Loans or changing or
extending the Commitments).
Section 11.5. Disclosure of Information. Any Bank or participant may,
in connection with any assignment or participation or proposed assignment
or participation pursuant to this Section, disclose to the assignee or
participant, or proposed assignee or participant, any information relating
to the Company furnished to such Bank by or on behalf of either the
Company; provided, however, that prior to any such disclosure of
information designated by the Company as confidential, each such assignee
or participant or proposed assignee or participant shall be advised of the
confidential nature of such information.
Section 11.6. Assignee or Participant Affiliated with the Borrower. If
any assignee Bank is an Affiliate of the Company, then any such assignee
Bank shall have no right to vote as a Bank hereunder or under any of the
Other Documents for purposes of granting consents or waivers or for
purposes of agreeing to amendments or other modifications to this Agreement
or any of the Other Documents or for purposes of making requests to the
Agents pursuant to Section 11 hereof, and the determination of the Banks
shall, for all purposes of this Agreement and the Other Documents, be made
without regard to such assignee Bank's interest in any of the Loans or the
Letter of Credit Participations, including, without limitation,
determinations requiring the consent of all Banks. If any Bank sells a
participating interest in any of the Loans or the Letter of Credit
Participations to a participant, and such participant is the Company or an
Affiliate of the Company, then such transferor Bank shall promptly notify
the Agents of the sale of such participation. A transferor Bank shall have
no right to vote as a Bank under this Agreement or any of the Other
Documents for purposes of (i) granting consents or waivers, (ii) agreeing
to amendments or modifications to this Agreement or any of the Other
Documents or, (iii) making requests to the Agents pursuant to Section 11
hereof to the extent that such participation is beneficially owned by the
Company or any Affiliate of the Company, and the determination of the Bank
shall for all purposes of this Agreement and the Other Documents be made
without regard to the interest of such transferor Bank in the Loans or the
Letter of Credit Participations to the extent of such participation.
Section 11.7. Miscellaneous Assignment Provisions. If any assignee
Bank is not incorporated under the laws of the United States of America or
any state thereof, it shall, prior to the date on which any interest or
fees are payable under this Agreement or any of the Other Documents for its
account, deliver to the Company and the Agents certification as to its
exemption from deduction or withholding of any United States federal income
taxes. If any Bank which serves as the
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bank to which reference is had for the determination of any rate of
interest chargeable under this Agreement transfers all of its interest,
rights and obligations under this Agreement, the Agents shall, in
consultation with the Company and with the consent of the Company and the
Banks, appoint another Bank to act as a reference bank hereunder. Anything
contained in this Section 11 to the contrary notwithstanding, any Bank may
at any time pledge all or any portion of its interest and rights under this
Agreement (including all or any portion of its Note) to any of the twelve
(12) Federal Reserve Banks organized under Section 4 of the Federal Reserve
Act. No such pledge or the enforcement thereof shall release the pledgor
Bank from its obligations under this Agreement or any of the Other
Documents.
Section 11.8. No Assignment or Delegation by the Company. The Company
shall not assign or delegate any of its rights or duties under this
Agreement, and any attempted assignment by the Company shall be null and
void and without legal effect.
Section 12. MISCELLANEOUS
Section 12.1. Confidentiality. In handling any financial or business
information provided under this Agreement by the Company, each of the
Agents, the Banks and their officers, agents, attorneys, accountants or
designees shall exercise the same degree of care that such Person exercises
with respect to its own proprietary information of the same types to
maintain the confidentiality of any non-public information thereby received
except that disclosure of such information may be made (i) to Bank
Affiliates in connection with their present or prospective business
relations with the Company; (ii) with the prior consent of the Company, to
prospective assignees, transferees or purchasers of an interest in the
Obligations (which consent shall not be unreasonably withheld although it
shall be reasonable for the Company to withhold such consent if the
prospective assignee, transferee or purchaser is a competitor of the
Company); (iii) as required by any Law or order, subpoena, judicial order
or similar order; and (iv) as may be required in connection with the
examination, audit or similar investigation of the Banks.
Section 12.2. Waivers.
Section 12.2.1. The Company waives presentment, demand, notice,
protest, notice of acceptance, notice of loans made, credit extended,
collateral received or delivered or other action taken in reliance hereon
and all other demands and notices of any description. With respect to the
Obligations, the Company assents to any extension or postponement of the
time of payment or any other indulgence, to any substitution, exchange or
release of any collateral, to the addition or release of any party or
Person primarily or secondarily liable therefor, to the acceptance of
partial payments thereon and the settling, compromising or adjusting of any
of the foregoing, all in such manner and at such time or times as the Banks
may deem advisable in their sole and absolute discretion. The Banks shall
have no duty, other than to act in a commercially reasonable manner, as to
the
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collection or protection of collateral or any income thereon, as to the
preservation of rights or remedies against prior parties, or as to the
preservation of any rights and remedies pertaining thereto beyond the safe
custody thereof. The Banks may exercise their rights and remedies with
respect to any collateral without resorting or regard to other collateral
or sources of reimbursement for liability. The Banks shall not be deemed to
have waived any of their rights and remedies with respect to the
Obligations or any collateral unless such waiver shall be in writing and
signed by the Agents. No delay or omission on the part of the Banks in
exercising any right or remedy shall operate as a waiver of such right or
remedy or any other right or remedy. A waiver on any one occasion shall not
be construed as a bar to any subsequent enforcement by the Banks. All
rights and remedies of the Banks with respect to the Obligations or any
collateral shall be cumulative and may be exercised singularly or
concurrently.
Section 12.2.2. THE COMPANY ACKNOWLEDGES THAT THE TRANSACTION OF
WHICH THIS AGREEMENT IS A PART IS A COMMERCIAL TRANSACTION AND HEREBY
WAIVES ITS RIGHTS TO NOTICE AND HEARING UNDER CHAPTER 903a OF THE
CONNECTICUT GENERAL STATUTES OR BY OTHER APPLICABLE LAW WITH RESPECT TO ANY
PREJUDGMENT REMEDY WHICH THE AGENTS OR THE BANKS MAY DESIRE TO USE.
Section 12.2.3. THE COMPANY HEREBY WAIVES TRIAL BY JURY IN ANY
COURT IN ANY SUIT, ACTION OR PROCEEDING OR ANY MATTER ARISING IN CONNECTION
WITH OR IN ANY WAY RELATED TO THE TRANSACTION OF WHICH THIS AGREEMENT IS A
PART AND/OR IN THE ENFORCEMENT BY THE AGENTS OR THE BANKS OF ANY OF THEIR
RIGHTS AND REMEDIES HEREUNDER OR UNDER APPLICABLE LAW. THE COMPANY
ACKNOWLEDGES THAT IT MAKES THIS WAIVER KNOWINGLY, VOLUNTARILY AND ONLY
AFTER CONSIDERATION OF THE RAMIFICATIONS OF THIS WAIVER WITH ITS ATTORNEY.
Section 12.2.4. In addition to (and without limitation of) any
right of setoff, bankers' lien or counterclaim that the Banks may have,
each of the Banks shall be entitled, at its option, to the fullest extent
permitted by law, to setoff and apply any and all balances and deposits
(general or special, time or demand, provisional or final) at any time held
and all other indebtedness owing by such Bank to or for the credit or
account of the Company (whether or not such balances, deposits or other
indebtedness are then due to the Company) against any and all of the
Obligations upon the failure of the Company to pay when due any amount
owing pursuant to this Agreement or the Notes. Any Bank exercising a right
under this Section 12.2.4. shall give the Company prompt notice thereof;
provided, however, that any failure to give such notice shall not affect
the validity of any such action, and shall further account to each other
Bank for any amounts so received in accordance with Section 2.5.10. hereof.
Section 12.2.5. The Company does hereby waive any claims, causes
of action, losses, damages or expenses, in tort, contract or otherwise
which the Company may have against the Agents, the Banks, a Bank Affiliate
or any Bank Agents which has arisen out of the
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relationship between it and the Agents, the Banks or any Bank Affiliate or
Bank Agents which the Company may have as of the Closing Date. The Company
acknowledges that it makes this waiver and release knowingly, voluntarily
and only after considering the ramifications of this waiver and release
with its attorneys.
Section 12.3. Notices. All notices, requests, demands or other
communications required by this Agreement shall be made in writing and
shall be (i) personally delivered, (ii) transmitted by postage prepaid
registered mail, return receipt requested, (iii) transmitted by telex (with
postage prepaid mail confirmation), (iv) transmitted by telecopier or
facsimile or (v) transmitted by internationally recognized courier service
with provision for receipt (with charges prepaid) and unless otherwise
specifically provided herein, shall be deemed to have been duly given on
the first to occur of (i) the date of delivery if delivered personally,
(ii) five (5) days following posting if transmitted by mail, (iii) the date
of transmission with confirmed answer back if transmitted by telex, or (iv)
the date of receipt if transmitted by telecopier or by internationally
recognized courier service if addressed as follows or to such other address
as either party may designate in writing:
If to the Company:
Meditrust
197 First Avenue
Needham, MA 02194
Attn: David F. Benson, President
Telephone: (617) 433-6000
Telecopier: (617) 433-1290
with a copy to:
Nutter, McClennen & Fish
One International Place
Boston, MA 02110-2699
Attn: Paul R. Eklund, Esq.
Telephone: (617) 439-2303
Telecopier: (617) 973-9748
If to the Agents:
Fleet Bank, National Association
One Constitution Plaza
Hartford, CT 06115-1600
Attn: Barbara Beaudoin, Vice President
Telephone: (203) 244-5537
Telecopier: (203) 244-7045
First Union National Bank of North Carolina
One First Union Center
Charlotte, NC 28288-0735
Attn: John W. Ransom, Vice President
Telephone: (704) 383-5212
Telecopier: (704) 374-4092
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with a copy, in the case of Fleet, to:
Updike, Kelly & Spellacy, P.C.
One State Street
P.O. Box 231277
Hartford, CT 06123-1277
Attn: Robert J. Martino, Esq.
Telephone: (203) 548-2658
Telecopier: (203) 548-2680
with a copy, in the case of FUB, to:
King & Spalding
191 Peachtree Street
Atlanta, GA 30303-1763
Attn: Walter W. Driver, Esq.
Telephone: (404) 572-4600
Telecopier: (404) 572-5100
If to the Banks, to the address set forth in the most recent
Administrative Questionnaire received by the Agents if the notice is to be
given by the Agents and to the Agents, as set forth above, if the notice is
to be given by the Company.
Section 12.4. Fees and Expenses. The Company will pay on demand all
reasonable out-of-pocket expenses incurred by the Agents in connection with
(i) the issuance of any Letters of Credit; (ii) any amendment or
modification of this Agreement or the Other Documents requested by the
Company; (iii) any prepayment, refinancing or other restructuring of this
Agreement; (iv) any Qualified Appraisal subject to the provisions of
Section 6.2. hereof and (v) the Agents' or the Banks' exercise,
preservation or enforcement of any of their rights and remedies under this
Agreement and the Other Documents from and after the occurrence of a
Default or Event of Default, including, without limitation, reasonable fees
and expenses of outside legal counsel, accounting, appraisal, auditing,
consulting, or other similar professional fees or expenses, and the amount
of all such expenses shall, until paid, bear interest at the rate
applicable to principal hereunder (including any default rate).
Section 12.5. Term of Agreement. This Agreement shall continue in
force and effect so long as the Banks have any commitment to make Revolving
Loans or Letters of Credit hereunder or any of the Obligations shall be
outstanding.
Section 12.6. Taxes.
(a) All payments made by the Company on account of this Agreement
shall be made free and clear of, and without deduction for
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or on account of, any present or future stamp or other taxes, levies,
imposts, duties, charges, fees, deductions, withholdings, restrictions or
conditions of any nature whatsoever now or hereafter imposed, levied,
collected, withheld or assessed by the United States of America (or by any
political subdivision or taxing authority thereof or therein), excluding
income, excise and franchise taxes now or hereafter imposed by the United
States of America or any political subdivision or taxing authority thereof
or therein (such non-excluded taxes being called "Taxes"). If any Taxes are
required to be withheld from any amounts payable to the Agents or any Bank
pursuant to this Agreement or the Other Documents, then the amounts so
payable to the Agents or the Banks shall be increased to the extent
necessary to yield to the Agents or the Banks (after payment of all Taxes)
interest or any such other amounts payable hereunder at the rates or in the
amounts specified herein. Whenever any Tax is payable by the Company, as
promptly as possible thereafter, the Company shall send the Agents an
original official receipt showing payment thereof. The Company shall
indemnify the Agents and the Banks for any incremental taxes, interest or
penalties that may become payable by them as a consequence of the failure
of the Company to pay any Taxes or the failure of the Company to deliver to
the Agents an original official receipt therefor.
(b) The Company shall indemnify the Agents and the Banks for and
hold the Agents and the Banks harmless from any present or future claim of
liability for any registration charge or any stamp, excise or similar
taxes, including any interest equalization tax, and any penalties or
interest with respect thereto, that may be imposed by any jurisdiction in
connection with this Agreement.
Section 12.7. Schedules and Exhibits. The Schedules and Exhibits
which are attached hereto are and shall constitute a part of this
Agreement.
Section 12.8. Governing Law; Consent to Jurisdiction. This Agreement,
the Notes and the Other 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 Connecticut (or,
if any portion of any collateral is located in another state, by the laws
of such state to the extent necessary for the enforcement of the Banks'
remedies under this Agreement). The Company agrees that any suit for the
enforcement of this Agreement, the Notes or the Other Documents may be
brought in the courts of the State of Connecticut or any federal court
sitting therein and consents to the non-exclusive jurisdiction of such
court and to service of process in any such suit being made upon the
Company by mail at the address referred to in Section 12.3. hereof.
Section 12.9. Survival of Representations. All representations,
warranties, covenants and agreements contained in this Agreement, the Notes
or the Other Documents shall survive the Closing Date, and continue in full
force and effect until all of the payment and the performance of the
Obligations in full.
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Section 12.10. Amendments. No modification or amendment of this
Agreement, the Notes or the Other Documents shall be effective unless same
shall be in writing and signed by the Company, the Agents and the Majority
Banks (or all of the Banks if required hereunder); provided, however, that
modifications and amendments to Section 11 hereof shall be governed by
Section 9.15. hereof.
Section 12.11. Counterparts. This Agreement may be signed in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
Section 12.12. No Agency Relationship. The Agents and the Banks are
not the agents or representatives of the Company nor is the Company the
agent or representative of the Agents or the Banks and this Agreement shall
not make the Agent or the Banks liable to any third party, including, but
not limited to, the Company's existing shareholders, directors, officers,
creditors or any other party in interest.
Section 12.13. Severability. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provisions in any other
jurisdiction.
Section 12.14. Headings. All article, section and subsection headings
in this Agreement, the Notes and the Other Documents are included for
convenience of reference only and shall not constitute a part of this
Agreement, the Notes or the Other Documents for any other purpose.
Section 12.15. Brokers. No broker or finder has brought about the
obtaining, making or closing of, and no broker's or finder's fees or
commissions will be payable by the Company, the Agents or any Bank to any
Person in connection with, the transactions contemplated by this Agreement,
and, except as to Fees due to the Banks under this Agreement, each party
hereunder shall indemnify and hold the other parties to this Agreement
harmless from and against any and all cost, claim, liability, damage or
expense (including but not limited to reasonable attorneys' fees) in
connection with any broker's or finder's fees or commission's claimed to be
due hereunder as a result of such indemnifying party's actions.
Section 12.16. Reinstatement. This Agreement shall continue to be
effective or be reinstated, as the case may be, if at any time any amount
received by the Agent or the Banks in respect of the Obligations is
rescinded or must otherwise be restored or returned by the Banks upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Company or upon the appointment of any intervenor or conservator of, or
trustee or similar official for, the Company or any substantial part of its
properties or assets, or otherwise, all as though such payments had not
been made.
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Section 12.17. Interpretation and Construction. The following rules
shall apply to the interpretation and construction of this Agreement, the
Notes and the Other Documents unless the context requires otherwise: (a)
the singular includes the plural and the plural includes the singular; (b)
words importing any gender include the other genders; (c) references to
statutes are to be construed as including all statutory provisions
consolidating, amending or replacing the statute to which reference is made
and all regulations promulgated pursuant to such statutes; (d) references
to "writing" shall include printing, photocopy, typing, lithography and
other means of reproducing words in a tangible, visible form; (e) the words
"including", "includes" and "include" shall be deemed to be followed by the
words "without limitation"; (f) references to the introductory paragraph,
preliminary statements, articles, sections (or subdivisions of sections),
exhibits or schedules are to those of this Agreement unless otherwise
indicated; (g) references to agreements and other contractual instruments
shall be deemed to include all subsequent amendments and other
modifications to such instruments, but only to the extent that such
amendments and other modifications are permitted or not prohibited by the
terms of this Agreement; (h) references to Persons include their respective
permitted successors and assigns; and (i) "or" is not exclusive.
Section 12.18. Indemnification. The Company hereby indemnifies and
holds the Agents, the Banks and any Bank Affiliate and any Bank Agents (an
"Indemnified Party"), harmless from and against any and all claims,
actions, causes of action, damages, losses, obligations, payments,
liabilities, costs, fees or expenses (including reasonable legal fees and
expenses) which the Indemnified Party may incur or which may be claimed
against the Indemnified Party by any Person by reason of or in connection
with the execution, delivery, operation, enforcement or termination of this
Agreement, the Notes or the Other Documents or in any manner in connection
with or related to this Agreement, the Notes or the Other Documents or the
transactions contemplated hereby or thereby; provided, however, that the
Company shall not be required to indemnify the Indemnified Party for any
claims, actions, causes of action, damages, losses, obligations, payments,
liabilities, costs, fees or expenses to the extent, but only to the extent,
caused by the Indemnified Party's gross negligence or willful misconduct or
if the Company shall be the prevailing party in any such claim, action or
cause of action. Nothing in this Section is intended to limit the Company's
obligations hereunder. In case any claim is asserted or any action or
proceeding is brought against an Indemnified Party, the Indemnified Party
shall promptly notify the Company of such claim, action or proceeding and,
at the option of the Indemnified Party, (i) such Indemnified Party may
retain legal counsel, reasonably satisfactory to the Company, to represent
it in such defense and the Company shall reimburse such Indemnified Party
for its reasonable fees and expenses of such legal counsel or (ii) the
Company shall resist, settle or defend with counsel reasonably
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acceptable to such Indemnified Party, such claim, action or proceeding. The
Agents, the Banks, the Bank Affiliates and the Bank Agents shall cooperate
and join with the Company, at the expense of the Company, as may be
required in connection with any action taken or defended by the Company as
provided herein.
Section 12.19. Limitation of Liability. The Declaration of Trust of
Meditrust, a copy of which is duly filed in the office of the Secretary of
the Commonwealth of Massachusetts, provides that the name "Meditrust"
refers to the Trustees under the Declaration of Trust collectively as
Trustees, but not individually or personally; and that no trustee, officer,
shareholder, employee or agent of Meditrust shall be held to any personal
liability, jointly or severally, for any obligation of, or claim against,
Meditrust. All persons dealing with Meditrust, in any way, shall look only
to the assets of Meditrust and the collateral pledged as security for the
Notes, if any, for the payment of any sum or the performance of any
obligation of Meditrust under the Notes or otherwise.
IN WITNESS WHEREOF, the Company, the Agents and the Banks have executed
this Agreement as of the date first set forth above.
THE COMPANY:
MEDITRUST
By:________________________________
Name:
Its:
MEDIPLEX OF QUEENS, INC.
MEDITRUST OF ALABAMA, INC.
MEDITRUST OF ARKANSAS, INC.
MEDITRUST OF KANSAS, INC.
MEDITRUST OF LOUISIANA, INC.
MEDITRUST AT ALPINE, INC.
MEDITRUST OF HOUSTON, INC.
MEDITRUST AT MOUNTAINVIEW, INC.
MEDITRUST OF BATON ROUGE, INC.
MEDITRUST OF TEXAS, INC.
MEDITRUST OF CALIFORNIA, INC.
MEDITRUST OF COLORADO, INC.
MEDITRUST OF MICHIGAN, INC.
MEDITRUST OF MISSOURI, INC.
MEDITRUST OF WYOMING, INC.
MEDITRUST OF WASHINGTON, INC.
MEDITRUST MORTGAGE INVESTMENTS, INC.
MEDITRUST OF LOS ANGELES, INC.
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MEDITRUST OF OHIO, INC.
MEDITRUST OF BAKERSFIELD,
CALIFORNIA, INC.
MEDITRUST OF ARLINGTON, TEXAS, INC.
MEDITRUST ACQUISITION CORPORATION
MARIN HEALTH CARE ASSOCIATES LIMITED
PARTNERSHIP
By: Meditrust of California, Inc.,
General Partner
MEDITRUST OF DESOTO LIMITED
PARTNERSHIP
By Meditrust of Texas, Inc.,
General Partner
PLAZA MEDICAL NURSING FACILITY
By Meditrust, General Partner
MEDITRUST OF ARIZONA, INC.
MEDITRUST MANAGEMENT CORP.
MEDITRUST OF CONNECTICUT, INC.
MEDITRUST OF SAN ANTONIO , INC.
MEDITRUST OF MARYLAND, INC.
MEDITRUST TRI-STATES, INC.
MEDITRUST OF KENTUCKY, INC.
MEDITRUST HOLDING VI, INC.
MEDITRUST HOLDING VII, INC.
MEDITRUST OF MASSACHUSETTS, INC.
MEDITRUST FINANCE CORPORATION
MEDITRUST OF COLLEGE STATION, INC.
MEDITRUST OF NEW YORK, INC.
PACIFIC FINANCE CORPORATION
MEDITRUST FINANCIAL SERVICES CORPORATION
MEDITRUST OF NEW HAMPSHIRE, INC.
MEDITRUST OF LYNN, INC.
MEDITRUST OF BENTON, INC.
NEW ENGLAND FINANCE CORPORATION
(as to all of the foregoing)
By:____________________________
Name:
Its:
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THE BANKS:
FLEET BANK, NATIONAL ASSOCIATION
By:________________________________
Name:
Its:
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
By:________________________________
Name:
Its:
THE BANK OF CALIFORNIA, N.A.
By:________________________________
Name:
Its:
THE BANK OF TOKYO TRUST COMPANY
By:________________________________
Name:
Its:
SHAWMUT BANK CONNECTICUT, N.A.
By:________________________________
Name:
Its:
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NATIONAL WESTMINSTER BANK USA
By:________________________________
Name:
Its:
THE RIGGS NATIONAL BANK OF
WASHINGTON, D.C.
By:________________________________
Name:
Its:
THE BANK OF NEW YORK
By:________________________________
Name:
Its:
THE AGENTS:
FLEET BANK, NATIONAL ASSOCIATION
By:________________________________
Name:
Its:
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
By:________________________________
Name:
Its: