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AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
by and among
MEDITRUST
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
July 20, 1995
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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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AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
This AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT (the "Agreement")
is made as of this 20th day of July, 1995 by and among MEDITRUST, a
Massachusetts business trust, with its chief executive office located at 197
First Avenue, Needham, Massachusetts 02194 ("Meditrust" or 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.
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 Amended and Restated Revolving
Credit Agreement and shall include any and all amendments, restatements,
modifications and supplements hereto.
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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.
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 or any
Subsidiary 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.
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Section 1.19. "CLOSING DATE" means July 20, 1995.
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 FIFTY-FIVE
MILLION AND NO/100 DOLLARS ($155,000,000.00).
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 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 organized to own a Facility of which the Company or a
Subsidiary of the Company is the general partner and owns one hundred percent
(100%) of the partnership interests of such limited partnership.
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 or a Subsidiary of 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 or a Subsidiary of the
Company.
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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 or a Subsidiary of the Company is the sole
general partner and which the Company or a Subsidiary of the Company owns at
least sixty six and two/thirds percent (66.66%) of the aggregate partnership
interests of such limited partnership.
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, a
Subsidiary of 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
aggregate interest in the Controlled Limited Partnership possessed by the
Company or a Subsidiary of the Company and the denominator of which is one
hundred (100);
BUT EXCLUDING FROM THE CALCULATION THEREOF:
(a) any Investment in which the Company or a Subsidiary of 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 or a Subsidiary of 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.
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
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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, a Subsidiary of
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 Limited Partnership, a Controlled Limited Partnership or
any Subsidiary of the Company 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.
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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 or a Subsidiary of 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),
(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,
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(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 the Company 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.
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 or any
Subsidiary of the Company's investment in Facilities leased by, the Company or
any Subsidiary of 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
2.2.10. 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
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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.
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 Company 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 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
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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 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 Company 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 or a Subsidiary of the Company, the amount invested by the Company
or a Subsidiary of the Company in the case of a Facility leased by the Company
or any such Subsidiary 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 or a Subsidiary of 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 or a Subsidiary of 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 Subsidiary of 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 or a Subsidiary of 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 or a Subsidiary of the Company under
the lease relating thereto.
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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 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
(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%).
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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 and it's
Subsidiaries on a consolidated basis 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.
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
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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 or a Subsidiary of 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, a Subsidiary of 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.
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.
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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 or a Subsidiary of 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.
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:
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(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 or a
Subsidiary of 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 or a Subsidiary of the Company, provided that any such bond (x) may
only be held during the time that the Company or a Subsidiary of 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.
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.
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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.
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 or any Subsidiary 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.
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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).
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.
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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.
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.
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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.
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 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. 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.
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, the Company shall
notify the
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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 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 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
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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 of its 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 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 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
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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 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
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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 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 2.2. 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 or a Subsidiary 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).
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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 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 (i) on _____, 1994, Fleet issued 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) the Company guaranteed 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 or a Subsidiary of
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 or any such Subsidiary 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 or any such Subsidiary.
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 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
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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 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
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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 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
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").
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
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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.
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 2.2.10. GUARANTY. The Company shall unconditionally
guarantee the payment and performance of the Reimbursement Obligations of each
Subsidiary in respect of any Letter of Credit issued under this Agreement
pursuant to a continuing guaranty agreement in the form attached hereto as
EXHIBIT C (the "Guaranty").
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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 ($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, 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.
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(c) Notwithstanding the foregoing, the Company
may not select an Interest Period that would end, but for the provisions of the
definition of Interest Period, after the Scheduled Maturity Date.
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 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
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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.
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.
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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.
ERROR! BOOKMARK NOT DEFINED.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 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. 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 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, 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
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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 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.
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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 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
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
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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.
(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 [6~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
39
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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 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
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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 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 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, have been duly authorized by all necessary action,
and do not and will not (a) require any consent or approval of the shareholders
of the Company not obtained, (b) contravene Meditrust's Declaration of Trust,
(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 of Meditrust or any agreement
(including any agreement with stockholders), instrument or Legal Requirements
to which the Company is subject which would have a Material Adverse Effect.
Meditrust is not a 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) which limits the amount of, or otherwise imposes restrictions on the
incurring of, Indebtedness of the Company of the type to be
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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, 1993 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 and 1995 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, 1994. 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 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.
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Section 3.11. USE OF PROCEEDS. Meditrust is not 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. Section Section 80(a)(1)
ET SEQ.). Meditrust (i) is not 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 not 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, 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 or a Subsidiary of the Company has good
and marketable fee or leasehold title to all its real property, including all
Facilities owned by the Company, a Subsidiary of 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 or a Subsidiary of
the Company's Liens therein. No financing statement under any Uniform
Commercial Code or other law which names the Company or any Subsidiary of the
Company as a debtor relating to any Facility has been filed in any jurisdiction
and neither the Company or any Subsidiary of the Company has 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
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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 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, its Subsidiaries 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:
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(a) The business operations of the Company, each
Subsidiary 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 Subsidiary of the Company or 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 Subsidiary of 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
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, any Subsidiary of 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 Subsidiary of 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 Subsidiary 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, any Subsidiary of the Company, or any Operator, which
would have a Material Adverse Effect or any result in a material decrease in
the value of a Facility and neither the Company, any Subsidiary or 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, any Subsidiary of 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 Subsidiary of the
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 a Subsidiary of the Company or any Operator.
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Section 3.24. MATERIAL SUBSIDIARIES. All Subsidiaries of Meditrust
are listed on SCHEDULE 3.24. attached 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.
Section 3.26. INTERCOMPANY INDEBTEDNESS. All Indebtedness of any
Subsidiary of the Company to the Company or to another Subsidiary of the
Company is evidenced by an intercompany promissory note. All Indebtedness of
any Subsidiary of the Company which relates to any Investment is subject to
terms and conditions, including rates of interest and terms of repayment, which
are substantially similar to the terms and conditions of the underlying
Investment in all material respects.
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 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 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
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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 from the Secretary of the
Commonwealth of Massachusetts certifying as to the Declaration of Trust of
Meditrust.
Section 4.4.3. A certificate from the Secretary of the
Commonwealth of Massachusetts certifying as to the good standing of Meditrust.
Section 4.4.4. 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 4.4.5. 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 4.4.6. 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 4.4.7. 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.
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.
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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.
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.
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 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 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
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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 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.
(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 Subsidiary of the Company regarding any material weakness of the various
accounting practices and control procedures used by Meditrust or any Subsidiary
of the Company;
(ii) promptly after the Company becomes aware of the
commencement thereof, notice of all actions, suits and proceedings against the
Company or any Subsidiary of the Company 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
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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 or any Subsidiary of 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, any
Subsidiary of the Company, or any Company Limited Partnership taken as a whole
promptly upon the Company, any Subsidiary of 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 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
from the 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
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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, on behalf of itself and each of its
Subsidiaries, 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 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, on behalf of itself and each of its
Subsidiaries, 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, on behalf of itself and each of its Subsidiaries,
covenants to (i) keep all of its 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 or its
Subsidiaries 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, on behalf of itself and each of its Subsidiaries,
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).
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(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 shall cause each of its Subsidiaries to preserve and
maintain its existence as a 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, any
Subsidiaries of the Company or their 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 any Subsidiary of the Company; and (ii) discuss the
affairs, finances and business operations of the Company and any Subsidiary of
the Company with its and their 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 and its
Subsidiaries shall keep adequate books and records of account, in which true
and complete entries will be made reflecting all of their 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 and its Subsidiaries
shall obtain and/or maintain in full force and effect all material permits,
authorizations, licenses, approvals, waivers and consents which they presently
possesses and are advisable to maintain or which may become necessary in the
future to conduct their business operations.
ERROR! BOOKMARK NOT DEFINED.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 and its
Subsidiaries 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 or any
Subsidiary of 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 or its Subsidiaries, 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 or any of its Subsidiaries 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 or any of its Subsidiaries 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 or any of its Subsidiaries, 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 of its Subsidiaries 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 of its Subsidiaries, 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 of its Subsidiaries, Facilities and
Operators, to the 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).
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Section 6.15. 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 6.16. INTERCOMPANY INDEBTEDNESS. All Indebtedness of any
Subsidiary of the Company to the Company or any other Subsidiary shall be
evidenced by an intercompany promissory note executed within 30 days after the
insurance of such indebtedness. All Indebtedness of any Subsidiary of the
Company which relates to any Investment shall be subject to terms and
conditions, including rates of interest and terms of repayment, which are
substantially similar to the terms and conditions of the underlying Investment
in all material respects.
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. Neither the Company nor any
of its Subsidiaries shall 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 of the Company 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;
(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
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(5) the proceeds of such additional Indebtedness shall be
used to prepay outstanding Loans as required by said Section 2.1.15; and
(e) Indebtedness of any Subsidiary of the Company to the Company
the proceeds of which are used to fund Investments in the ordinary course of
the business of the Company.
Section 7.2. CONTINGENT LIABILITIES. Neither the Company nor any of
its Subsidiaries shall 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 of the Company and its Subsidiaries 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
described in subsections (a) and (b) of Section 7.1.; and
(g) Guarantees of the Company or any Subsidiary of the
Company 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 or any
Subsidiary of the Company actually advances funds as a result of a demand for
payment under such Guarantee.
Section 7.3. NEGATIVE PLEDGE/ENCUMBRANCES. Neither the Company nor
any of its Subsidiaries 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,
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(b) other Liens incidental to the conduct of the
Company's or any Subsidiary'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
or any its Subsidiaries 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 or any such Subsidiary 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 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 and its Subsidiaries taken as a
whole, and
(f) Liens on property of the Company or any of its
Subsidiaries 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 or any of its
Subsidiaries 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:
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(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
(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 and its
Subsidiaries 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 and its Subsidiaries' 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
and its Subsidiaries' 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 and its Subsidiaries' 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 and its Subsidiaries'
Gross Real Estate Investments.
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(ii) Gross Real Estate Investments relating to
Life Care Centers of America, Inc. (exclusive of Gross Real Estate Investments
relating to 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 and its
Subsidiaries' Gross Real Estate Investments.
Section 7.8. CONSTRUCTION INVESTMENTS. The Company and its
Subsidiaries shall not permit the Construction Investments of the Company and
its Subsidiaries to exceed seventeen and one-half percent (17.5%) of Gross Real
Estate Investments. In addition, neither the Company nor any Subsidiary shall
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 or such
Subsidiary'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 or a Subsidiary of 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. Neither the Company nor any Subsidiary
shall 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 under such
Facility Lease cover fully the Company's or such Subsidiary 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. Neither the Company nor any of its
Subsidiaries shall create or suffer to exist any obligations for the payment of
rent by the Company or such Subsidiary for any property under leases
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(other than capitalized lease obligations included as Indebtedness of the
Company or such Subsidiary) 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. Neither the Company nor any
of its Subsidiaries shall engage in any prohibited transactions as such term is
defined in Section 857(b)(6) of the Code (except that the Company or a
Subsidiary 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 or a Subsidiary incur any material liability for
excise taxes pursuant to Section 4981 of the Code.
Section 7.15. MERGERS. Neither the Company nor any of its
Subsidiaries shall 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 Meditrust or a Subsidiary may
merge or consolidate with any other Person if in such transaction Meditrust or
the Subsidiary is the surviving entity and the 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 or any 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 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
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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. Neither the Company nor
any Subsidiary shall 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 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
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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 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.
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(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.
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
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the foregoing to the extent they arise from the gross negligence or willful
misconduct of the Person to be indemnified.
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 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
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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.
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
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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;
(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
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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 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
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
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(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
(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
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 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
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(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 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 the Company declare the Notes
(together with accrued 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 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
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and deliver to the Administrative Agent an assignment and acceptance in the
form of EXHIBIT I attached hereto (the "Assignment and Acceptance") and a
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
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
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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 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 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
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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 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.
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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 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.
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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 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: Cliff Mellor, Vice President
Telephone: (203) 244-5157
Telecopier: (203) 244-5616
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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
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: John F. Wolter, Esq.
Telephone: (203) 548-2691
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).
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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 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.
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
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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 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.
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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
/s/ Michael S. Benjamin
By:________________________________
Name: Michael S. Benjamin
Its: Senior Vice President
THE BANKS:
FLEET BANK, NATIONAL ASSOCIATION
/s/ Douglas G. Russell
By:________________________________
Name: Douglas G. Russell
Its: Senior Vice President
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
/s/ Joseph H. Towell
By:________________________________
Name: Joseph H. Towell
Its: First Senior Vice President
THE BANK OF CALIFORNIA, N.A.
/s/ A.W. Kelley
By:________________________________
Name: A.W. Kelley
Its: Vice President
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THE BANK OF TOKYO TRUST COMPANY
/s/ Michael J. Cronin
By:________________________________
Name: Michael J. Cronin
Its: Vice President
SHAWMUT BANK CONNECTICUT, N.A.
/s/ David C. Paulsor
By:________________________________
Name: David C. Paulsor
Its: Vice President
NATIONAL WESTMINSTER BANK USA
/s/ Paul Chau
By:________________________________
Name: Paul Chau
Its: Vice President
THE RIGGS NATIONAL BANK OF WASHINGTON,
D.C.
/s/ R. L. Amader
By:________________________________
Name: R. L. Amader
Its: Vice President
THE BANK OF NEW YORK
/s/ Kenneth Sneider
By:________________________________
Name: Kenneth Sneider
Its: Vice President
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THE AGENTS:
FLEET BANK, NATIONAL ASSOCIATION
/s/ Douglas G. Russell
By:________________________________
Name: Douglas G. Russell
Its: Senior Vice President
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
/s/ Joseph N. Towell
By:________________________________
Name: Joseph N. Towell
Its: Senior Vice President