EXHIBIT 10.22
PRIME MEDICAL SERVICES, INC.
AMENDED AND RESTATED
LOAN AGREEMENT
$50,000,000.00
TERM LOAN
and
$40,000,000.00
REVOLVING CREDIT LOAN
THE FIRST NATIONAL BANK OF BOSTON,
as Administrative Agent and Syndication Agent
NATIONSBANK OF TEXAS, N.A.,
as Documentation Agent
and
THE BANKS NAMED HEREIN,
as Banks
Dated as of April 26, 1996
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS............................................1
Section 1.1 Amendment and Restatement...........................1
Section 1.2 Definitions.........................................1
Section 1.3 Other Definitional Provisions......................14
ARTICLE II ADVANCES.............................................14
Section 2.1 Commitments........................................14
Section 2.2 Notes..............................................15
Section 2.3 Repayment of Advances..............................15
Section 2.4 Interest...........................................15
Section 2.5 Borrowing Procedure................................16
Section 2.6 Continuations; Conversions.........................16
Section 2.7 Use of Proceeds....................................17
Section 2.8 Fees...............................................17
ARTICLE III PAYMENTS............................................17
Section 3.1 Method of Payment..................................17
Section 3.2 Optional Prepayment................................18
Section 3.3 Mandatory Prepayments..............................18
Section 3.4 Pro Rata Treatment.................................19
Section 3.5 Non-Receipt of Funds by the Administrative Agent...19
Section 3.6 Withholding Taxes..................................19
Section 3.7 Withholding Tax Exemption..........................20
Section 3.8 Computation of Interest............................20
Section 3.9 Order of Application...............................20
ARTICLE IV YIELD PROTECTION AND ILLEGALITY......................21
Section 4.1 Additional Costs...................................21
Section 4.2 Limitation on Eurodollar Advances..................22
Section 4.3 Illegality.........................................22
Section 4.4 Treatment of Eurodollar Advances...................22
Section 4.5 Compensation.......................................23
Section 4.6 Capital Adequacy...................................23
ARTICLE V SECURITY..............................................24
Section 5.1 Collateral.........................................24
Section 5.2 Setoff.............................................24
Section 5.3 Guaranties.........................................24
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ARTICLE VI CONDITIONS PRECEDENT.................................24
Section 6.1 Initial Advance....................................24
Section 6.2 All Advances.......................................26
ARTICLE VII REPRESENTATIONS AND WARRANTIES......................26
Section 7.1 Existence..........................................27
Section 7.2 Financial Statements...............................27
Section 7.3 Corporate Action: No Breach........................27
Section 7.4 Operation of Business..............................27
Section 7.5 Litigation and Judgments...........................28
Section 7.6 Rights in Properties; Liens........................28
Section 7.7 Enforceability.....................................28
Section 7.8 Approvals..........................................28
Section 7.9 Debt...............................................28
Section 7.10 Taxes.............................................28
Section 7.11 Use of Proceeds; Margin Securities................28
Section 7.12 ERISA.............................................28
Section 7.13 Disclosure........................................29
Section 7.14 Subsidiaries; Partnerships........................29
Section 7.15 Agreements........................................29
Section 7.16 Compliance with Legal Requirements;
Governmental Authorizations.......................29
Section 7.17 Investment Company Act............................30
Section 7.18 Public Utility Holding Company Act................30
Section 7.19 Environmental Matters.............................30
Section 7.20 Acquisition.......................................30
ARTICLE VIII POSITIVE COVENANTS.................................31
Section 8.1 Reporting Requirements.............................31
Section 8.2 Maintenance of Existence; Conduct of Business......33
Section 8.3 Maintenance of Properties..........................33
Section 8.4 Taxes and Claims...................................33
Section 8.5 Insurance..........................................33
Section 8.6 Inspection Rights..................................34
Section 8.7 Keeping Books and Records..........................34
Section 8.8 Compliance with Laws...............................34
Section 8.9 Compliance with Agreements.........................34
Section 8.10 Further Assurances................................34
Section 8.11 ERISA.............................................34
Section 8.12 Information Relating to Proposed Acquisitions.....34
Section 8.13 After-Acquired Subsidiaries.......................34
Section 8.14 Syndication Cooperation...........................35
ARTICLE IX NEGATIVE COVENANTS...................................35
Section 9.1 Debt...............................................35
Section 9.2 Limitation on Liens................................35
Section 9.3 Mergers, Etc.......................................36
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Section 9.4 Restricted Payments................................36
Section 9.5 Investments........................................36
Section 9.6 Limitation on Issuance of Capital Stock............37
Section 9.7 Transactions With Affiliates.......................37
Section 9.8 Disposition of Assets..............................37
Section 9.9 Sale and Leaseback.................................37
Section 9.10 Prepayment of Debt................................37
Section 9.11 Nature of Business................................37
Section 9.12 Environmental Protection..........................38
Section 9.13 Accounting........................................38
Section 9.14 Amendment of Partnership and Management
Agreements........................................38
ARTICLE X FINANCIAL COVENANTS...................................38
Section 10.1 Total Debt to EBITDA..............................38
Section 10.2 Interest Coverage Ratio...........................38
Section 10.3 Total Debt Service Coverage Ratio.................39
Section 10.4 Consolidated Net Worth............................39
Section 10.5 Minimum EBITDA....................................39
ARTICLE XI DEFAULT..............................................39
Section 11.1 Events of Default.................................39
Section 11.2 Remedies..........................................41
Section 11.3 Performance by the Administrative Agent...........42
ARTICLE XII THE ADMINISTRATIVE AGENT............................42
Section 12.1 Appointment, Powers and Immunities................42
Section 12.2 Rights of Administrative Agent as a Bank..........43
Section 12.3 Sharing of Payments, Etc..........................43
Section 12.4 Indemnification...................................44
Section 12.5 Independent Credit Decisions......................44
Section 12.6 Several Commitments...............................45
Section 12.7 Successor Administrative Agent....................45
Section 12.8 Independent Contractor............................45
ARTICLE XIII MISCELLANEOUS......................................46
Section 13.1 Expenses..........................................46
Section 13.2 Indemnification...................................46
Section 13.3 No Duty...........................................46
Section 13.4 No Fiduciary Relationship.........................46
Section 13.5 No Waiver; Cumulative Remedies....................47
Section 13.6 Successors and Assigns............................47
Section 13.7 Survival..........................................49
Section 13.8 Entire Agreement..................................49
Section 13.9 Amendments, Etc...................................49
Section 13.10 Maximum Interest Rate............................50
Section 13.11 Notices..........................................50
Section 13.12 Governing Law....................................50
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Section 13.13 Counterparts.....................................50
Section 13.14 Severability.....................................50
Section 13.15 Headings.........................................50
Section 13.16 Construction.....................................50
Section 13.17 Independence of Covenants........................50
Section 13.18 Confidentiality..................................51
Section 13.19 Renewal and Increase.............................51
Section 13.20 Waiver of Jury Trial.............................51
Section 13.21 Choice of Forum; Consent to Service of
Process and Jurisdiction.........................52
INDEX TO EXHIBITS
Exhibit Description of Exhibit
A Advance Request Form
B Form of Assignment and Acceptance
C Borrower Security Agreement
D Form of Guaranty
E Form of Guarantor Security Agreement
F Form of Pledge Agreement
G Form of Revolving Credit Note
H Form of Term Note
I Perfection Certificate
J Form of Opinion of Counsel for Borrower and the Guarantors
K Compliance Certificate
INDEX TO SCHEDULES
Schedule Description of Schedule
1 Commitments
2 Guarantors
3 Partnerships
7.5 Existing Litigation
7.9 Existing Debt
7.14.1 Capitalization of Subsidiaries
7.14.2 Partners
7.15 Agreements
7.16 Governmental Disclosures
7.19 Environmental Matters
9.2 Existing Liens
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AMENDED AND RESTATED LOAN AGREEMENT
THIS AMENDED AND RESTATED LOAN AGREEMENT (the "Agreement"), dated as of
April 26, 1996, is among PRIME MEDICAL SERVICES, INC., a Delaware corporation
("Borrower"), each of the banks or other lending institutions which is or which
may from time to time become a signatory hereto or any successor or assignee
thereof (collectively, the "Banks" and individually, a "Bank"), THE FIRST
NATIONAL BANK OF BOSTON ("FNBB"), a national banking association, as
Administrative Agent for itself and the other Banks (in such capacity, together
with its successors in such capacity, the "Administrative Agent"), NATIONSBANK
OF TEXAS, N.A. ("NationsBank"), a national banking association, as Documentation
Agent for itself and the other Banks (in such capacity, together with its
successors in such capacity, the "Documentation Agent"), and FNBB, as
Syndication Agent (in such capacity, together with its successors in such
capacity, the "Syndication Agent").
R E C I T A L S
1. Reference is hereby made to that certain Loan Agreement dated as of
November 28, 1994, by and between Borrower, the Banks defined therein, and FNBB,
as Agent for the Banks defined therein as amended by that certain First
Amendment to Loan Agreement dated as of August 17, 1995 (the "Original Credit
Agreement").
2. Borrower has requested that the Banks increase the Commitments (as
defined in the Original Credit Agreement), provide to Borrower the Term Loan
Commitment (as defined herein), admit additional financial institutions as Banks
hereunder and modify certain other provisions contained in the Original Credit
Agreement.
3. The Administrative Agent, the Documentation Agent, the Syndication
Agent, the Banks and Borrower desire and have agreed to amend and restate the
Original Credit Agreement in its entirety as and pursuant to this Agreement.
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Amendment and Restatement.
----------------------------
This Agreement is in renewal, extension, modification, increase and
restatement of the Original Credit Agreement.
Section 1.2 Definitions.
------------
As used in this Agreement, the following terms shall have the following
meanings:
"Acquisition" means any transaction, or any series of related transactions,
consummated on or after the date hereof, by which Borrower or any Subsidiary
directly or indirectly (a) acquires all or substantially all of the assets of
any Person, whether through purchase of assets, merger, or otherwise, (b)
acquires (in one transaction or as the most recent transaction in a series of
transactions) at least a majority (in number of votes) of the securities (or
similar ownership interests) of any Person, or (c) acquires (in one transaction
or as the most recent transaction in a series of transactions) at least a
majority of the general partnership interests of any Person.
"Additional Costs" has the meaning specified in Section 4.1.
"Adjusted Eurodollar Rate" means, for any Eurodollar Advance for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 0.01%) determined by the Administrative Agent to be equal to (a) the
Eurodollar Rate for such Eurodollar Advance for such Interest Period divided by
(b) 1.00 minus the Reserve Requirement for such Eurodollar Advance for such
Interest Period.
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"Administrative Agent" has the meaning specified in the preamble.
"Advance" means (a) with respect to the Revolving Credit Commitment, each
advance of funds by the Banks, or any of them, to Borrower pursuant to Section
2.5(b), and (b) with respect to the Term Loan Commitment, each advance by the
Banks to Borrower pursuant to Section 2.5(a).
"Advance Request Form" means a certificate, in substantially the form of
Exhibit A, properly completed and signed by Borrower requesting an Advance.
"Affiliate" means, as to any Person, any other Person (a) that directly or
indirectly, through one or more intermediaries, Controls or is Controlled by, or
is under common Control with, such Person, (b) that directly or indirectly
beneficially owns or holds five percent (5%) or more of any class of voting
stock of such Person, or (c) five percent (5%) or more of the voting stock of
which is directly or indirectly beneficially owned or held by the Person in
question; provided, however, in no event shall the Agents or any Bank be deemed
an Affiliate of Borrower or any of its Subsidiaries.
"After-Acquired Subsidiary" has the meaning specified in Section 8.13.
"Agents" means the Administrative Agent, the Documentation Agent and the
Syndication Agent. "Agent" means any one of the Agents.
"Alternate Base Rate" means, at any time, the greater of (a) the variable
rate of interest established from time to time by the Administrative Agent as
its "base rate" and set by the Administrative Agent as a general reference rate
of interest charged by the Administrative Agent, and (b) the Federal Funds Rate
plus one-half of one percent (.5%). Borrower acknowledges that the
Administrative Agent may, from time to time, extend credit to other borrowers at
rates of interest varying from, and having no relationship to, such general
reference rate. Each change in the Alternate Base Rate shall become effective
without prior notice to Borrower automatically as of the opening of business on
the date of such change in the Alternate Base Rate.
"Alternate Base Rate Advances" means Advances that bear interest at rates
based upon the Alternate Base Rate.
"Applicable Lending Office" means for each Bank and each Type of Advance,
the lending office of such Bank (or of an Affiliate of such Bank) designated for
such Type of Advance below its name on the signature pages hereof or an
Assignment and Acceptance, or such other office of such Bank (or of an Affiliate
of such Bank) as such Bank may from time to time specify to Borrower and the
Administrative Agent as the office by which its Advances of such Type are to be
made and maintained.
"Applicable Margin" means the interest margin over the Alternate Base Rate
or the Adjusted Eurodollar Rate, as the case may be, that is as follows: (a)
from the date hereof until delivery of financial statements and a compliance
certificate for the period ending September 30, 1996, as required hereunder, (i)
one and one-quarter of one percent (1.25%) for Alternate Base Rate Advances, and
(ii) two and three-quarters of one percent (2.75%) for Eurodollar Advances; and
(b) thereafter, based on the Total Debt to EBITDA Ratio as of and for the most
recent four (4) quarter period ending on or before the date of determination,
the margin set forth opposite such ratio below:
Applicable
Margin Applicable
Alternate Margin
Base Rate Eurodollar
Total Debt to EBITDA Ratio Advances Advances
------------------------------------ ------------ ----------
Less than 2.0 to 1.0 0.5% 2.00%
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Less than 2.50 to 1.0 but greater than 0.75% 2.25%
or equal to 2.0 to 1.0
Less than 3.0 to 1.0 but greater than 1.00% 2.50%
or equal to 2.50 to 1.0
Less than 3.50 to 1.0 but greater than 1.25% 2.75%
or equal to 3.0 to 1.0
Greater than or equal to 3.50 to 1.0 1.50% 3.00%
The Total Debt to EBITDA Ratio shall be determined from the then-most
current of either (a) the quarterly or annual financial statements and related
compliance certificate delivered pursuant to Section 8.1, or (b) the most recent
Advance Request Form for a Permitted Acquisition, calculating any adjustments to
such ratio necessitated as a result of the Permitted Acquisition for which such
Advance was made. The adjustment, if any, to the Applicable Margin shall be
effective commencing on the fifth (5th) Business Day after delivery of such
financial statements (and related compliance certificate) or the respective date
of Advance for a Permitted Acquisition, as the case may be. If Borrower fails at
any time to furnish to the Administrative Agent and the Banks the financial
statements and related compliance certificate as required to be delivered
pursuant to Section 8.1, then the maximum Applicable Margin shall apply until
such time as such financial statements and compliance certificates are so
delivered.
"Applicable Payment Amount" means, as of any date, an amount equal to (a)
the aggregate amount of Debt of the Companies, as of such date, minus (b) the
product of (i) EBITDA of the Companies, for the four (4) fiscal quarter period
immediately preceding the date of determination, and (ii) 2.75; provided that if
such Applicable Payment Amount is less than $0.00, then the Applicable Payment
Amount shall be $0.00.
"Applicable Rate" means: (a) during any period that an Advance is an
Alternate Base Rate Advance, the Alternate Base Rate plus the Applicable Margin;
and (b) during any period that an Advance is a Eurodollar Advance, the Adjusted
Eurodollar Rate plus the Applicable Margin.
"Applicable Unused Fee Percentage" means the per annum rate with respect to
the unused portion of the Revolving Credit Commitments as follows: (a) from the
date hereof until delivery of financial statements and a compliance certificate
for the period ending September 30, 1996, as required hereunder, one-half of one
percent (0.50%); and (b) thereafter, based on the Total Debt to EBITDA Ratio as
of and for the most recent four (4) quarter period ending on or before the date
of determination, the percentage set forth opposite such ratio below:
Applicable
Unused Fee
Total Debt to EBITDA Ratio Percentage
Less than 2.5 to 1.0 0.375%
Greater than or equal to 2.50 to 1.0 0.50%
The Applicable Unused Fee Percentage shall be adjusted, if necessary, at
the same time as adjustments to the Applicable Margin.
"Assignee" has the meaning specified in Section 13.6.
"Assigning Bank" has the meaning specified in Section 13.6.
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"Assignment and Acceptance" means an assignment and acceptance entered into
by an Assigning Bank and its Assignee and accepted by the Administrative Agent
pursuant to Section 13.6, in substantially the form of Exhibit B.
"Bank" and "Banks" have the meanings specified in the preamble.
"Basle Accord" means the proposals for risk-based capital framework
described by the Basle Committee on Banking Regulations and Supervisory
Practices in its paper entitled "International Convergence of Capital
Measurement and Capital Standards" dated July 1988, as amended, supplemented and
otherwise modified and in effect from time to time, or any replacement thereof.
"Borrower Security Agreement" means the Borrower Security Agreement
executed by Borrower in favor of the Administrative Agent for the benefit of the
Banks in substantially the form of Exhibit C, as the same may be amended,
supplemented, or modified from time to time, which Borrower Security Agreement
is in renewal, amendment, restatement and substitution of that certain Borrower
Security Agreement dated November 28, 1994, executed by Borrower in favor of the
Administrative Agent, for the benefit of the Banks under the Original Credit
Agreement, as amended pursuant to that First Amendment to Borrower Security
Agreement dated as of August 17, 1995.
"Business Day" means (a) any day on which the Administrative Agent is open
for regular business, and (b) with respect to all borrowings, payments,
Conversions, Continuations, Interest Periods, and notices in connection with
Eurodollar Advances, any day which is a Business Day described in clause (a)
above and which is also a day on which dealings in Dollar deposits are carried
out in the London interbank market.
"Capital Lease Obligations" means, as to any Person, the obligations of
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) real and/or personal property, which obligations are
required to be classified and accounted for as a capital lease on a balance
sheet of such Person under GAAP. For purposes of this Agreement, the amount of
such Capital Lease Obligations shall be the capitalized amount thereof, as
determined in accordance with GAAP.
"Change in Control" means the individuals who, as of the date of this
Agreement, constitute the members of Borrower's Board of Directors (the
"Incumbent Board") do not constitute or cease for any reason to constitute at
least fifty percent (50%) of:
(a) Borrower's Board of Directors; or
(b) The surviving corporation's Board of Directors in the event of any
merger or consolidation (if permitted by Section 9.3) involving Borrower; or
(c) The controlling entity's board of directors, the comparable body if
there is no Board of Directors, or voting control if there is no comparable
body, in the event that the surviving corporation under clause (b) above is
directly or indirectly controlled by that entity.
Any individual who becomes a member of the Board of Directors or comparable
body or who obtains a voting interest, as applicable under clauses (a), (b), or
(c) above, after the date of this agreement and whose appointment to the Board,
or nomination for election, was approved or ratified by a vote of the
individuals comprising at least fifty (50%) of the Incumbent Board shall be
deemed to be a member of the Incumbent Board.
"Code" means the Internal Revenue Code of 1986, as amended, and the
regulations promulgated and rulings issued thereunder.
"Collateral" has the meaning specified in Section 5.1.
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"Commitment" means, as to each Bank as of any date, the Revolving Credit
Commitment and the Term Loan Commitment of such Bank. "Commitments" means the
Revolving Credit Commitments and the Term Loan Commitments of all the Banks.
"Companies" means Borrower and its Subsidiaries.
"Confidential Information" means any and all information relating to the
Companies, including, without limitation, information relating to each of the
Company's financial condition, business plans, management, earnings, assets,
liabilities, contracts, processes, products, research and development
activities, intellectual property, services, customers, suppliers, marketing and
sales. In addition, Confidential Information shall include any and all other
information marked or identified in writing by any of the Companies as
"Confidential" or "Confidential Information" and provided by each of the
Companies or its representatives to any of the Banks or the Agents or obtained
by the Banks or the Agents after an inspection pursuant to Section 8.6.
Notwithstanding the foregoing, "Confidential Information" shall not include:
(i) any information known to an Agent or a Bank prior to disclosure by any
of the Companies or its representatives, as documented prior to such disclosure
in such Agent's or Bank's written records;
(ii) any information which an Agent or a Bank demonstrates became available
to it on a non-confidential basis from a source (other than any of the
Companies) who is not bound by a confidentiality agreement with, or any other
contractual, legal or fiduciary obligation of confidentiality to, any of the
Companies or any other party with respect to such information;
(iii) any information which an Agent or a Bank demonstrates is or becomes
generally available to the public other than as a result of a disclosure by it
in breach of Section 13.18; and
(iv) any information which an Agent or a Bank demonstrates was conceived of
or developed by it or any of its employees without access or reference, directly
or indirectly, to the Confidential Information.
"Consolidated Net Income" means, for any Person for any period, the amount
which, in conformity with GAAP, would be shown on a consolidated income
statement of such Person as net income for such period, after deduction of any
minority interests.
"Consolidated Net Worth" means, at any particular time, all amounts which,
in conformity with GAAP, would be included as stockholders' equity on a
consolidated balance sheet of the Companies.
"Continue," "Continuation," and "Continued" refers to the continuation
pursuant to Section 2.6 of a Eurodollar Advance from one Interest Period to the
next Interest Period.
"Control" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities or other ownership interests, by
contract or otherwise. "Controlling" and "Controlled" have meanings correlative
thereto.
"Conversion" and "Converted" refers to a conversion pursuant to Section 2.6
of one Type of Advance into another Type of Advance.
"Debt" means as to any Person at any time (without duplication and without
duplication among the Companies): (a) all obligations of such Person for
borrowed money; (b) all obligations of such Person evidenced by bonds, notes,
debentures, or other similar instruments; (c) all obligations of such Person to
pay the deferred purchase price of property or services, except trade accounts
payable of such Person arising in the ordinary course of business that are not
past due by more than ninety (90) days; (d) all Capital Lease Obligations of
such Person; (e) all indebtedness or other obligations of others of the types
described in this definition, if Guaranteed by such Person; (f) all obligations
secured by a Lien existing on property owned by such Person,
5
whether or not the obligations secured thereby have been assumed by such
Person or arenon-recourse to the credit of such Person; (g) all reimbursement
obligations of such Person (whether contingent or otherwise) in respect of
letters of credit, bankers' acceptances, surety or other bonds and similar
instruments; and (h) all liabilities of such Person in respect of unfunded
vested benefits under any Plan; provided, however, that the term Debt shall not
include endorsements of instruments for deposit or collection in the ordinary
course of business.
"Default" means an Event of Default or the occurrence of an event or
condition which with the giving of notice or the lapse of time or both would
become an Event of Default.
"Defaulting Bank" means any Bank that has defaulted on any of its
obligations under this Agreement.
"Default Rate" means the lesser of (a) the Maximum Rate, and (b) the sum of
the Alternate Base Rate in effect from day to day plus the Applicable Margin
plus two percent (2%).
"Documentation Agent" has the meaning specified in the preamble.
"Dollars" and "$" mean lawful money of the United States of America.
"EBITDA" means, for any Person for any period, Consolidated Net Income of
such Person for such period, determined after deduction of any minority
interests, plus all amounts deducted therefrom during such period, in conformity
with GAAP, for interest, taxes, depreciation and amortization.
"Eligible Assignee" means any commercial bank, savings and loan
association, savings bank, finance company, insurance company, pension fund,
mutual fund, or other financial institution (whether a corporation, partnership,
or other entity) approved by the Administrative Agent and, so long as no Default
has occurred and is continuing, Borrower, such approvals not to be unreasonably
withheld.
"Environmental Laws" means any and all federal, state, and local laws,
regulations, and requirements pertaining to health, safety, or the environment,
including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, 42 U.S.C. ss. 9601 et seq., the Resource
Conservation and Recovery Act of 1976, 42 U.S.C. ss. 6901 et seq., the
Occupational Safety and Health Act, 29 U.S.C. ss. 651 et seq., the Clean Air
Act, 42 U.S.C. ss. 7401 et seq., the Clean Water Act, 33 U.S.C. ss. 1251 et
seq., and the Toxic Substances Control Act, 15 U.S.C. ss. 2601 et seq., as such
laws, regulations, and requirements may be amended or supplemented from time to
time.
"Environmental Liabilities" means, as to any Person, all liabilities,
obligations, responsibilities, Remedial Actions, losses, damages, punitive
damages, consequential damages, treble damages, costs, and expenses (including,
without limitation, all reasonable fees, disbursements and expenses of counsel,
expert and consulting fees and costs of investigation and feasibility studies),
fines, penalties, sanctions, and interest incurred as a result of any claim or
demand, by any Person, whether based in contract, tort, implied or express
warranty, strict liability, criminal or civil statute, including any
Environmental Law, permit, order or agreement with any Governmental Authority or
other Person, arising from environmental, health or safety conditions or the
Release or threatened Release of a Hazardous Material into the environment,
resulting from the past, present, or future operations of such Person or its
Affiliates.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations and published interpretations
thereunder.
"ERISA Affiliate" means any corporation or trade or business which is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as Borrower or is under common control (within the
meaning of Section 414(c) of the Code) with Borrower.
6
"Eurodollar Advances" means Advances the interest rates on which are
determined on the basis of the rates referred to in the definition of "Adjusted
Eurodollar Rate" in this Section 1.1.
"Eurodollar Rate" means, for any Eurodollar Advance for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
0.01%) quoted by the Administrative Agent at approximately 11:00 a.m. London
time (or as soon thereafter as practicable) two (2) Business Days prior to the
first (1st) day of such Interest Period for the offering by the Administrative
Agent to leading banks in the London interbank market of Dollar deposits in
immediately available funds having a term comparable to such Interest Period and
in an amount comparable to the principal amount of the Eurodollar Advance made
by the Administrative Agent to which such Interest Period relates. If the
Administrative Agent is not participating in any Eurodollar Advances during any
Interest Period therefor (pursuant to Section 4.4 or for any other reason), the
Adjusted Eurodollar Rate for such Advances for such Interest Period shall be
determined by reference to the amount of the Advances which the Administrative
Agent would have made had it been participating in such Advances.
"Event of Default" has the meaning specified in Section 11.1.
"Excess Cash Flow" means, for any quarterly period, (a) EBITDA, minus (b)
total cash income tax expense actually paid during such period, minus (c) the
aggregate amount of any optional prepayments of the Obligations during such
period, minus (d) scheduled principal payments in respect of all Debt during
such period, minus (e) total consolidated interest expense in respect of all
Debt actually paid or that is payable during such period, minus (f) capital
expenditures during such period (provided that such capital expenditures shall
not exceed (x) $2,000,000.00 minus (y) the aggregate amount of capital
expenditures during the three (3) fiscal quarters ending prior to such quarterly
fiscal period).
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 0.01%) equal to the weighted average of
the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day, provided that (a) if the day for which such rate is to be determined is not
a Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if such rate is not so published on such next
succeeding Business Day, the Federal Funds Rate for any day shall be the average
rate charged to the Administrative Agent on such day on such transactions as
determined by the Administrative Agent.
"FNBB" has the meaning specified in the preamble.
"GAAP" means generally accepted accounting principles, applied on a
consistent basis, as set forth in Opinions of the Accounting Principles Board of
the American Institute of Certified Public Accountants and/or in statements of
the Financial Accounting Standards Board and/or their respective successors and
which are applicable in the circumstances as of the date in question. Accounting
principles are applied on a "consistent basis" when the accounting principles
applied in a current period are comparable in all material respects to those
accounting principles applied in a preceding period, except for changes required
by GAAP.
"Governmental Authority" means any nation or government, any state or
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory, or administrative functions of or pertaining to
government.
"Governmental Authorization" shall mean any approval, consent, license,
permit, waiver, or other authorization issued, granted, given, or otherwise made
available by or under the authority of any Governmental Authority or pursuant to
any Legal Requirement.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
such Person directly or indirectly guaranteeing any Debt or other obligation of
any other Person and, without limiting the generality of the foregoing, any
obligation, direct or indirect, contingent or otherwise, of such Person (a) to
purchase or pay (or advance or supply funds for the purchase or payment of) such
Debt or other obligation (whether arising by virtue of partnership arrangements,
by agreement to
7
keep-well, to purchase assets, goods, securities or services, to take-or-pay, or
to maintain financial statement conditions or otherwise), or (b) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect the obligee against loss
in respect thereof (in whole or in part), provided that the term "Guarantee"
shall not include endorsements for collection or deposit in the ordinary course
of business. The term "Guarantee" used as a verb has a corresponding meaning.
"Guaranties" means, collectively, the Guaranty Agreements executed by the
Guarantors in favor of the Agents and the Banks, each in substantially the form
of Exhibit D, which Guaranty Agreements are in renewal, amendment, substitution
and replacement of the Guaranty Agreements executed by the Guarantors under the
Original Credit Agreement in favor of the Agent and the Banks under the Original
Credit Agreement. "Guaranty" means any one of the Guaranties.
"Guarantors" means, collectively, all Wholly-Owned Subsidiaries of
Borrower, now owned or hereafter acquired or formed, including, without
limitation, the Subsidiaries listed on Schedule 2. "Guarantor" means any one of
the Guarantors.
"Guarantor Security Agreements" means the Security Agreements executed by
the Guarantors in favor of the Administrative Agent, for the benefit of the
Banks, in substantially the form of Exhibit E, as the same may be amended,
supplemented or modified from time to time, which Security Agreements are in
renewal, amendment, restatement and substitution of the Security Agreements
executed by the Guarantors under the Original Credit Agreement in favor of the
Administrative Agent, for the benefit of the Banks under the Original Credit
Agreement. "Guarantor Security Agreement" means any one of the Guarantor
Security Agreements.
"Hazardous Material" means any substance, product, waste, pollutant,
material, chemical, contaminant, constituent, or other material which is or
becomes listed, regulated, or addressed under any Environmental Law, including,
without limitation, asbestos, petroleum, and polychlorinated biphenyls.
"Hedging Agreement" has the meaning specified in Section 11.1.
"Interest Coverage Ratio" means, as to the Companies for any period, (a)
EBITDA for such period divided by (b) the aggregate amount of consolidated
interest expense for such period, all as determined in accordance with GAAP.
"Interest Period" means, with respect to any Eurodollar Advance, each
period commencing on the date such Advance is made or Converted from an Advance
of another Type or, in the case of each subsequent, successive Interest Period
applicable to a Eurodollar Advance, the last day of the next preceding Interest
Period with respect to such Advance, and ending on the numerically corresponding
day in the first (1st), second (2nd), third (3rd) or sixth (6th) calendar month
thereafter, as Borrower may select as provided in Section 2.5 or 2.6, except
that each such Interest Period which commences on the last Business Day of a
calendar month (or on any day for which there is no numerically corresponding
day in the appropriate subsequent calendar month) shall end on the last Business
Day of the appropriate subsequent calendar month. Notwithstanding the foregoing:
(a) each Interest Period which would otherwise end on a day which is not a
Business Day shall end on the next succeeding Business Day (or, if such
succeeding Business Day falls in the next succeeding calendar month, on the next
preceding Business Day); (b) any Interest Period which would otherwise extend
beyond the Termination Date shall end on the Termination Date; (c) no more than
six (6) Interest Periods shall be in effect at the same time; and (d) no
Interest Period shall have a duration of less than one (1) month and, if any
Interest Period would otherwise be a shorter period, such Advances shall not be
available hereunder.
"Issuance Proceeds" means the net proceeds of (i) any sale or issuance of
Borrower's capital stock, or (ii) the incurrence of any Debt of the type
described in subsections (a) and (b) of the definition of Debt, in each case to
the extent permitted hereunder; provided that "Issuance Proceeds " shall not
include proceeds from the exercise of any warrants issued to Alabama Lithotripsy
Joint Venture to the extent such warrant proceeds are contemporaneously used to
pay outstanding Debt to Alabama Lithotripsy Joint Venture.
8
"Legal Requirement" shall mean any federal, state, local, municipal,
foreign, international, multinational, or other administrative order,
constitution, law, ordinance, principle of common law, regulation, statute, or
treaty as in effect on the date hereof.
"Lien" means any lien, mortgage, security interest, tax lien, financing
statement, pledge, charge, hypothecation, assignment, preference, priority, or
other encumbrance of any kind or nature whatsoever (including, without
limitation, any conditional sale or title retention agreement), whether arising
by contract, operation of law, or otherwise.
"Litho" means Lithotripters, Inc., a North Carolina corporation.
"Loan Documents" means this Agreement, the Notes, the Guaranties, the
Borrower Security Agreement, the Guarantor Security Agreements, the Pledge
Agreements, any Hedging Agreement between the Administrative Agent and the
Documentation Agent, and all other instruments, documents, and agreements
executed and delivered pursuant to or in connection with this Agreement, as such
instruments, documents, and agreements may be amended, modified, renewed,
extended, or supplemented from time to time.
"Material Subsidiary" means, as of any date, (a) any Subsidiary which,
together with its Subsidiaries, accounts for three percent (3%) or more of the
Company's consolidated gross revenues or assets, or (b) any combination of
Subsidiaries which, together with their Subsidiaries, account for seven percent
(7%) or more of the Company's consolidated gross revenues or assets, in each
case on a consolidated basis (but without elimination of any minority interests)
as of and for the most recent fiscal quarter for which such information is
available. "Material Subsidiaries" means all of the Material Subsidiaries.
"Maximum Rate" means, at any time and with respect to any Bank, the maximum
rate of interest under applicable law that such Bank may charge Borrower. The
Maximum Rate shall be calculated in a manner that takes into account any and all
fees, payments, and other charges in respect of the Loan Documents that
constitute interest under applicable law. Each change in any interest rate
provided for herein based upon the Maximum Rate resulting from a change in the
Maximum Rate shall take effect without notice to Borrower at the time of such
change in the Maximum Rate.
"Multiemployer Plan" means a multiemployer plan as defined in Section 3(37)
of ERISA to which contributions have been made by Borrower or any ERISA
Affiliate of Borrower and which is covered by Title IV of ERISA.
"NationsBank" has the meaning specified in the preamble.
"Notes" means the Revolving Credit Notes and the Term Notes. "Note" means
any one of the Notes.
"Obligated Party" means any Person who is or becomes party to any agreement
that guarantees or secures payment and performance of the Obligations or any
part thereof.
"Obligations" means all obligations, indebtedness, and liabilities of
Borrower to the Agents and the Banks, or any of them, arising pursuant to any of
the Loan Documents, now existing or hereafter arising, whether direct, indirect,
related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several,
or joint and several, and all interest accruing thereon and all attorneys' fees
and other expenses incurred in the enforcement or collection thereof.
"Original Credit Agreement" has the meaning specified in the recitals.
"Partnerships" means the partnerships in which Borrower or any Subsidiary
now owns or hereafter acquires general and/or limited partnership interests and
the other Persons in which Borrower or any Subsidiary now owns or hereafter
acquires ownership interests, including, without limitation, the partnerships
and other Persons listed on Schedule 3. "Partnership" means any one of the
Partnerships.
9
"Payment Date" means (a) with respect to Alternate Base Rate Advances and
the commitment fees payable pursuant to Section 2.8(a), the last Business Day of
each April, July, October and January, commencing June 30, 1996, and (b) with
respect to Eurodollar Advances, the last day of the respect Interest Period
therefor, provided that if any Interest Period is greater than three (3) months,
then accrued interest shall also be due and payable shall also be due and
payable on the date that is three (3) months after the commencement of such
Interest Period.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to all or any of its functions under ERISA.
"Permitted Acquisition" means an Acquisition by Borrower or any of its
Subsidiaries with respect to which each of the following conditions shall have
been satisfied:
(a) the Acquisition by Borrower or such Subsidiary is of a business, assets
or Person (as applicable, the "Target") which is engaged in substantially the
same business as the business conducted by Borrower or such Subsidiary on the
date hereof, or any other business reasonably related thereto;
(b) as of the closing of such Acquisition, the Acquisition has been
approved and recommended by the board of directors or other applicable governing
body of the Target and the Person from which the Target is to be acquired;
(c) prior to the closing of such acquisition, the Target and the Person
from which the Target is to be acquired must be Solvent;
(d) as of the closing of such Acquisition, after giving effect to such
Acquisition, Borrower or the Subsidiary that is the acquiring party must be
Solvent and the Companies, on a consolidated basis, must be Solvent;
(e) as of the closing of such Acquisition, after giving effect to such
Acquisition, no Default shall exist or occur as a result of, and after giving
effect to, such Acquisition;
(f) the aggregate purchase price with respect to such Acquisition does not
exceed five (5) times EBITDA of the Target, subject to adjustments acceptable to
the Administrative Agent where less than all of the business, assets or stock of
the Target is acquired, acquired pursuant to the Acquisition for the four (4)
fiscal quarters ending on the most recently ended fiscal period prior to the
date of such Acquisition;
(g) the aggregate cash consideration for such Acquisition does not exceed
$10,000,000.00 and the aggregate cash consideration for all Acquisitions (other
than the Acquisition of additional limited partnership interests of the
Partnerships in which Litho is, as of the date hereof, the general partner)
during the immediately preceding twelve (12) month period (including such
Acquisition) does not exceed $20,000,000.00;
(h) after giving effect to such Acquisition, the aggregate Debt of the
Companies (without deduction for any minority interests and including any
Advances under the Revolving Credit Commitments) does not exceed the product of
(1) EBITDA of the Companies (including EBITDA for the Target acquired pursuant
to the Acquisition) for the four (4) fiscal quarters ending on the closing of
the Acquisition, and (2) 2.75;
(i) the Administrative Agent shall have received pro forma financial
statements of the Companies (as if the business, assets or Person acquired had
been acquired since the first (1st) day of the period for which such pro forma
financial statements are delivered) for the prior four (4) fiscal quarters of
Borrower and the Companies;
(j) if the Target is to be an After-Acquired Subsidiary, then Borrower
shall have complied with the terms and conditions set forth in Section 8.13; and
10
(k) the Administrative Agent has received a certificate, executed by the
President or a Vice President of Borrower confirming that all representations
and warranties set forth in the Loan Documents continue to be true and correct
in all material respects immediately prior to and after giving effect to the
Permitted Acquisition and the transactions contemplated thereby, and setting
forth the calculations supporting compliance with the limitations prescribed
herein.
"Person" means any individual, corporation, business trust, association,
company, partnership, joint venture, Governmental Authority, or other entity.
"Plan" means any employee benefit or other plan established or maintained
by Borrower or any ERISA Affiliate of Borrower and which is covered by Title IV
of ERISA.
"Pledge Agreements" means the Pledge Agreements executed by Borrower and
each Subsidiary of Borrower that owns general and/or limited partnership
interests in the Partnerships in favor of the Administrative Agent, for the
benefit of the Banks, substantially in the form of Exhibit F, as the same may be
amended, supplemented or modified from time to time. "Pledge Agreement" means
any one of the Pledge Agreements.
"Pledgors" means each of the pledgors of partnership interests pursuant to
a Pledge Agreement. "Pledgor" means any one of the Pledgors.
"Principal Office" means the principal office of the Administrative Agent,
presently located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
"Prohibited Transaction" means any transaction set forth in Section 406 of
ERISA or Section 4975 of the Code.
"Regulation D" means Regulation D of the Board of Governors of the Federal
Reserve System as the same may be amended or supplemented from time to time.
"Regulatory Change" means, with respect to any Bank, any change after the
date of this Agreement in United States federal, state, or foreign laws or
regulations (including Regulation D) or the adoption or making after such date
of any interpretations, directives, or requests applying to a class of banks
including such Bank of or under any United States federal, state, or foreign
laws or regulations (whether or not having the force of law) by any court or
governmental or monetary authority charged with the interpretation or
administration thereof.
"Release" means, as to any Person, any release, spill, emission, leaking,
pumping, injection, deposit, disposal, disbursement, leaching, or migration of
Hazardous Materials into the indoor or outdoor environment or into or out of
property owned by such Person, including, without limitation, the movement of
Hazardous Materials through or in the air, soil, surface water, ground water, or
property.
"Remedial Action" means all actions required to (a) clean up, remove,
treat, or otherwise address Hazardous Materials in the indoor or outdoor
environment, (b) prevent the Release or threat of Release or minimize the
further Release of Hazardous Materials so that they do not migrate or endanger
or threaten to endanger public health or welfare or the indoor or outdoor
environment, or (c) perform pre-remedial studies and investigations and
post-remedial monitoring and care.
"Required Banks" means, as of any date, any combination of Banks (other
than any Defaulting Banks) who collectively hold sixty percent (60%) of the sum
of (a) the Revolving Credit Commitments (other than of any Defaulting Banks), or
if the Revolving Credit Commitments shall have been terminated, then of the
aggregate unpaid principal amount of the Revolving Credit Notes (other than of
any Defaulting Banks), and (b) the aggregate unpaid principal amount of the Term
Notes (other than of any Defaulting Banks).
"Reportable Event" means any of the events set forth in Section 4043 of
ERISA.
11
"Reserve Requirement" means, for any Eurodollar Advance for any Interest
Period therefor, the average rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by each Bank on its portion of such Advance
against "Eurocurrency Liabilities" as such term is used in Regulation D. Without
limiting the effect of the foregoing, the Reserve Requirement shall reflect any
other reserves required to be maintained by a Bank by reason of any Regulatory
Change against (i) any category of liabilities which includes deposits by
reference to which the Adjusted Eurodollar Rate is to be determined, or (ii) any
category of extensions of credit or other assets which include Eurodollar
Advances.
"Revolving Credit Commitment" means, as to each Bank as of any date, the
obligation of such Bank on such date to make Advances hereunder in an aggregate
principal amount at any time outstanding up to but not exceeding the amount
shown on Schedule 1 as its Revolving Credit Commitment, as the same may be
reduced pursuant to Section 2.1(c) or terminated pursuant to Section 2.1(c) or
Section 11.2 and as the same may be increased or decreased from time to time by
further assignment pursuant to Section 13.6. "Revolving Credit Commitments"
means the Revolving Credit Commitments of all of the Banks in the original
aggregate amount of $40,000,000.00.
"Revolving Credit Loan" means all Advances with respect to the Revolving
Credit Commitment, evidenced by the Revolving Credit Notes.
"Revolving Credit Note" means a revolving credit note executed by Borrower,
substantially in the form of Exhibit G, payable to each Bank in an amount equal
to such Bank's Revolving Credit Commitment, as the same may be amended,
supplemented, modified or restated from time to time, evidencing the obligation
of Borrower to repay the Revolving Credit Loan, and all renewals, modifications
and extensions thereof. "Revolving Credit Notes" means all of the Revolving
Credit Notes of the Banks.
"RICO" means the Racketeer Influenced and Corrupt Organization Act of 1970,
as amended from time to time.
"Solvent" means, with respect to any Person, that on the date of
determination (a) the fair market value of its assets is greater than the total
amount of liabilities, including, without limitation, contingent liabilities of
such Person which would be required to be included on the balance sheet of such
Person or disclosed in the financial statements of such Person in accordance
with GAAP, (b) the present fair salable value of the assets of such Person is
not less than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and matured, (c) such Person
does not intend to, and does believe that it will, incur debts or liabilities
beyond such Person's ability to pay as such debts and liabilities mature, and
(d) such Person is not engaged in business or transactions, and is not about to
engage in business or transactions, for which its assets would constitute an
unreasonably small capital.
"Subsidiary" means, with respect to any Person, any corporation,
partnership, association, or other business entity (a) of which securities or
other ownership interests representing more than fifty percent (50%) of the
equity or more than fifty percent (50%) of the ordinary voting power or more
than fifty percent (50%) of the general partnership interests are, at the time
any determination is made, owned, Controlled or held by such Person, or (b) that
is, at the time any determination is made, otherwise Controlled by one or more
Subsidiaries of such Person or by such Person and one or more Subsidiaries of
such Person.
"Syndication Agent" has the meaning specified in the preamble.
"Termination Date" means 1:00 p.m. Boston, Massachusetts time on April 30,
2001, or such earlier date and time on which the Commitments terminate as
provided in this Agreement.
"Term Loan" means the $50,000,000.00 term loan facility provided to
Borrower by the Banks hereunder.
"Term Loan Commitment" means, as to each Bank as of the date hereof, the
obligation of such Bank on such date to make Advances hereunder in an aggregate
principal amount up to but not exceeding the amount shown on Schedule 1 hereto
as its Term Loan Commitment, as the same may be increased or decreased from time
to time by further assignment pursuant
12
to Section 13.6. "Term Loan Commitments" means the Term Loan Commitments of
all of the Banks in the original aggregate amount of $50,000,000.00.
"Term Note" means a term promissory note executed by Borrower,
substantially in the form of Exhibit H, payable to each Bank in an amount equal
to such Bank's Term Loan Commitment, as the same may be amended, supplemented,
modified or restated from time to time, evidencing the obligation of Borrower to
repay the Term Loan, and all renewals, modifications and extensions thereof.
"Term Notes" means all of the Term Notes of the Banks.
"Total Debt Service Coverage Ratio" means, as to the Companies for any
period, (a) the sum of EBITDA for such period, minus the aggregate amount of
capital expenditures made during such period, divided by (b) the sum of all
principal and interest payments payable during such period in respect of all
Debt of the Companies (without deduction for any minority interests), all as
determined on a rolling four (4) quarter and consolidated basis in accordance
with GAAP.
"Total Debt to EBITDA" means, as of any date, the ratio of (a) the
aggregate amount of Debt of the Companies (without deduction for any minority
interests), as of such date, to (b) EBITDA of the Companies, for the four (4)
fiscal quarter period ending on the date of determination.
"Type" means any type of Advance (i.e., Alternate Base Rate Advance or
Eurodollar Advance).
"UCC" means the Uniform Commercial Code as in effect in the Commonwealth of
Massachusetts or other applicable jurisdiction, as amended.
"Wholly-Owned Subsidiaries" means, as of any date, all Subsidiaries that
are wholly-owned by Borrower or a wholly- owned Subsidiary of Borrower.
"Wholly-Owned Subsidiary" means any one of the Wholly-Owned Subsidiaries.
Section 1.3 Other Definitional Provisions.
------------------------------
All definitions contained in this Agreement are equally applicable to the
singular and plural forms of the terms defined. The words "hereof," "herein,"
and "hereunder" and words of similar import referring to this Agreement refer to
this Agreement as a whole and not to any particular provision of this Agreement.
Unless otherwise specified, all Article, Section, Exhibit and Schedule
references pertain to this Agreement. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP. All financial
covenants and related definitions relating to the Companies shall, unless
otherwise indicated, be determined after deduction of any minority interests,
provided that all references to "Debt" shall include all Debt without deduction
for any minority interests. Terms used herein that are defined in the UCC,
unless otherwise defined herein, shall have the meanings specified in the UCC.
ARTICLE II
ADVANCES
Section 2.1 Commitments.
-----------
(a) Revolving Credit Commitments. Subject to the terms and conditions of
this Agreement, each Bank hereby severally agrees to make one or more Advances
to Borrower from time to time from the date hereof to the Termination Date in an
aggregate principal amount at any time outstanding up to but not exceeding the
amount of such Bank's Revolving Credit Commitment as then in effect. Subject to
the foregoing limitations, and the other terms and provisions of this Agreement,
Borrower may borrow, repay, and reborrow hereunder the amount of the Revolving
Credit Commitments by means of Eurodollar Advances (or, in the event Eurodollar
Advances are unavailable hereunder, Alternate Base Rate Advances when required
or permitted by Article IV).
(b) Term Loan Commitments. Subject to the terms and conditions of this
Agreement, each Bank hereby severally agrees to make a single Advance to
Borrower, on or about the date of this Agreement, in the amount of such Bank's
Term Loan Commitment. Borrower may not borrow, repay, and reborrow hereunder any
portion of the amount of the Term Loan.
13
(c) Optional Reduction and Termination of Revolving Credit Commitments.
Borrower shall have the right to terminate in whole or reduce in part the unused
portion of the Revolving Credit Commitments upon at least three (3) Business
Days' prior written notice (which notice shall be irrevocable) to the
Administrative Agent specifying the effective date thereof, whether a
termination or reduction is being made, and the amount of any partial reduction,
provided that each partial reduction shall be in the amount of $1,000,000.00 or
a greater integral multiple thereof and Borrower shall simultaneously prepay the
amount by which the unpaid principal amount of the Revolving Credit Notes
exceeds the Revolving Credit Commitments (after giving effect to such notice)
plus accrued and unpaid interest on the principal amount so prepaid. No portion
of the Revolving Credit Commitments may be reinstated after it has been
terminated or reduced.
Section 2.2 Notes.
------
(a) Revolving Credit Notes. The obligation of Borrower to repay each Bank
for Advances made by such Bank pursuant to such Bank's Revolving Credit
Commitment, and all interest thereon, shall be evidenced by a Revolving Credit
Note dated the date hereof, executed by Borrower and payable to the order of
such Bank in the original principal amount of such Bank's Revolving Credit
Commitment.
(b) Term Notes. The obligation of Borrower to repay each Bank for Advances
made by such Bank pursuant to such Bank's Term Loan Commitment, and all interest
thereon, shall be evidenced by a Term Note dated the date hereof, executed by
Borrower and payable to the order of such Bank in the original principal amount
of such Bank's Term Loan Commitment.
Section 2.3 Repayment of Advances.
----------------------
(a) Revolving Credit Notes. Borrower shall repay the outstanding principal
amount of the Revolving Credit Notes on the Termination Date.
(b) Term Notes. Borrower shall repay the outstanding principal amount of
the Term Notes as follows: (i) in one (1) installment, on July 31, 1996, in the
amount of $1,000,000.00; (ii) in seven (7) equal quarterly installments, on
October 31, 1996, January 31, 1997, April 30, 1997, July 31, 1997, October 31,
1997, January 31, 1998, and April 30, 1998, each in the amount of $2,000,000.00;
(iii) in four (4) equal quarterly installments, on July 31, 1998, October 31,
1998, January 31, 1999 and April 30, 1999, each in the amount of $2,500,000.00;
and (iv) in eight (8) equal quarterly installments, on July 31, 1999, October
31, 1999, January 31, 2000, April 30, 2000, July 31, 2000, October 31, 2000,
January 31, 2001 and on the Termination Date, each in the amount of
$3,125,000.00.
Section 2.4 Interest.
---------
The unpaid principal amount of all Advances shall bear interest at a
varying rate per annum equal from day to day to the lesser of (a) the Maximum
Rate, or (b) the Applicable Rate. If at any time the Applicable Rate for any
Advance shall exceed the Maximum Rate, thereby causing the interest accruing on
such Advance to be limited to the Maximum Rate, then any subsequent reduction in
the Applicable Rate for such Advance shall not reduce the rate of interest on
such Advance below the Maximum Rate until the aggregate amount of interest
accrued on such Advance equals the aggregate amount of interest which would have
accrued on such Advance if the Applicable Rate had at all times been in effect.
Accrued and unpaid interest on the Advances shall be due and payable on each
Payment Date and on the Termination Date. Notwithstanding the foregoing, any
outstanding principal of any Advance and (to the fullest extent permitted by
law) any other amount payable by Borrower under this Agreement or any other Loan
Document that is not paid in full when due (whether at stated maturity, by
acceleration, or otherwise) shall bear interest at the Default Rate for the
period from and including the due date thereof to but excluding the date the
same is paid in full. Interest payable at the Default Rate shall be payable from
time to time on demand.
Section 2.5 Borrowing Procedure.
--------------------
(a) Revolving Credit Loan. Borrower shall give the Administrative Agent
notice by means of an Advance Request Form of each requested Advance under the
Revolving Credit Commitments hereunder at least two (2) Business Days before the
requested date of each Eurodollar Advance (and at least one (1) Business Day
before the requested date of each Alternate Base
14
Rate Advance), specifying: (a) the requested date of such Advance (which shall
be a Business Day); (b) the amount of such Advance; and (c) the duration of the
Interest Period for such Advance (if a Eurodollar Advance). The Administrative
Agent at its option may accept telephonic requests for Advances under the
Revolving Credit Commitments, provided that such acceptance shall not constitute
a waiver of the Administrative Agent's right to delivery of an Advance Request
Form in connection with subsequent Advances under the Revolving Credit
Commitments. Any telephonic request for an Advance under the Revolving Credit
Commitments by Borrower shall be promptly confirmed by submission of a properly
completed Advance Request Form to the Administrative Agent. Each Advance under
the Revolving Credit Commitments shall be in a minimum principal amount of
$1,000,000.00 or a greater integral multiple thereof, provided that if such
Advance equals the entire remaining unfunded portion of the Revolving Credit
Commitments, it may be for any amount. The aggregate principal amount of
Eurodollar Advances having the same Interest Period shall be at least equal to
$2,500,000.00 or a greater integral multiple of $500,000.00.
(b) Term Loan. Borrower shall give the Administrative Agent notice by means
of an Advance Request Form of the initial Advance under the Term Loan
Commitments hereunder at least two (2) Business Days before the requested date
thereof, specifying: (a) the requested date of such Advance (which shall be a
Business Day); (b) the amount of such Advance; and (c) the duration of the
Interest Period for such Advance (if a Eurodollar Advance).
(c) Generally. The Administrative Agent shall notify each Bank of the
contents of each Advance Request Form. Not later than 11:00 a.m. Boston,
Massachusetts time on the date specified for each Advance hereunder, each Bank
will make available to the Administrative Agent at the Principal Office in
immediately available funds, for the account of Borrower, its pro rata share of
each Advance. After the Administrative Agent's receipt of such funds and subject
to the other terms and conditions of this Agreement, the Administrative Agent
will make each Advance available to Borrower by depositing the same, in
immediately available funds, in a deposit account of Borrower maintained at the
Documentation Agent. All notices under this Section shall be irrevocable and
shall be given not later than 11:00 a.m. Boston, Massachusetts time on the day
which is not less than the number of Business Days specified above for such
notice.
Section 2.6 Continuations; Conversions.
---------------------------
(a) Continuations. Borrower shall have the right to Continue Eurodollar
Advances by giving the Administrative Agent written notice specifying: (i) the
Continuation date; (ii) the amount of the Advance to be Continued; and (iii) the
duration of the Interest Period applicable thereto, which notice shall be
irrevocable and must be given by Borrower not later than 11:00 a.m. Boston,
Massachusetts time at least two (2) Business Days before each such Continuation.
The Administrative Agent shall promptly notify each Bank of the contents of each
such notice. If Borrower shall fail to give the Administrative Agent the notice
as specified above for Continuation of a Eurodollar Advance prior to the end of
the Interest Period applicable thereto, such Eurodollar Advance shall be
automatically Continued for a one (1) month Interest Period.
(b) Conversions. Borrower shall have the right to Convert an Alternate Base
Rate Advance at any time to a Eurodollar Advance by giving the Administrative
Agent written notice specifying: (i) the Conversion Date; (ii) the amount of the
Advance to be Converted; and (iii) the duration of the Interest Period
applicable thereto, which notice shall be irrevocable and must be given by
Borrower not later than 11:00 a.m. Boston, Massachusetts time at least two (2)
Business Days before each such Conversion. The Administrative Agent shall
promptly notify each Bank of the contents of each such notice.
(c) Default. After the occurrence and during the continuance of a Default,
no outstanding Advances may be Converted into, or Continued as, a Eurodollar
Advance.
Section 2.7 Use of Proceeds.
----------------
(a) Revolving Credit Loan. The proceeds of Advances under the Revolving
Credit Commitments shall be used by Borrower (i) for working capital in the
ordinary course of business, (ii) to purchase, refurbish or replace equipment to
be utilized in lithotripsy operations, (iii) to finance the Acquisition of Litho
and to finance Permitted Acquisitions, (iv) to the extent permitted by this
Agreement, to repurchase outstanding capital stock of Borrower, and (v) to make
loans or capital contributions
15
to its Subsidiaries the proceeds of which are used by each such Subsidiary for
one or more of the purposes permitted by Subsections (i), (ii), (iii), and (iv)
of this Section 2.7(a).
(b) Term Loan. The proceeds of Advances under the Term Loan Commitments
shall be used by Borrower to finance the Acquisition of Litho.
Section 2.8 Fees.
-----
(a) Borrower hereby agrees to pay to the Administrative Agent, for the
ratable account of each Bank, a commitment fee on the daily average unused
amount of such Bank's Revolving Credit Commitment for the period from and
including the date of this Agreement to but excluding the Termination Date, at
the per annum rate equal to the Applicable Unused Fee Percentage based on a
365-day or 366-day year, as the case may be, and the actual number of days
elapsed. Accrued commitment fees shall be payable in arrears on each Payment
Date and on the Termination Date.
(b) Borrower hereby agrees to pay to the Agents for their own respective
accounts, the fees agreed to by Borrower and the Agents pursuant to a side
letter agreement with each Agent.
ARTICLE III
PAYMENTS
Section 3.1 Method of Payment.
------------------
All payments of principal, interest, and other amounts to be paid by
Borrower under this Agreement and the other Loan Documents shall be paid to the
Administrative Agent at the Principal Office for the account of each Bank's
Applicable Lending Office in Dollars and in immediately available funds, without
setoff, deduction, or counterclaim, not later than 1:00 p.m. Boston,
Massachusetts time on the date on which such payment shall become due (each such
payment made after such time on such due date to be deemed to have been made on
the next succeeding Business Day). Borrower shall, at the time of making each
such payment, specify to the Administrative Agent the sums payable by Borrower
under this Agreement and the other Loan Documents to which such payment is to be
applied (and in the event that Borrower fails to so specify, or if an Event of
Default has occurred and is continuing, the Administrative Agent may apply such
payment to the Obligations in such order and manner as it may elect in its sole
discretion, subject to Section 3.4). Each payment received by the Administrative
Agent under this Agreement or any other Loan Document for the account of a Bank
shall be paid promptly to such Bank, in immediately available funds, for the
account of such Bank's Applicable Lending Office. Whenever any payment under
this Agreement or any other Loan Document shall be stated to be due on a day
that is not a Business Day, such payment may be made on the next succeeding
Business Day, and such extension of time shall in such case be included in the
computation of the payment of interest and commitment fee, as the case may be.
Section 3.2 Optional Prepayment.
--------------------
Borrower may, upon at least three (3) Business Days' prior notice to the
Administrative Agent, prepay the Notes in whole at any time or from time to time
in part without premium or penalty but with accrued interest to the date of
prepayment on the amount so prepaid, provided that (a) Eurodollar Advances
prepaid on a day other than the last day of the Interest Period for such
Advances shall include the additional compensation, if any, required by Section
4.5, and (b) each partial prepayment shall be in the amount of the aggregate
remaining outstanding principal amount of the Eurodollar Advances or in the
principal amount of $1,000,000.00 or a greater integral multiple thereof. All
notices under this Section shall be irrevocable and must be given by Borrower
not later than 11:00 a.m. Boston, Massachusetts time on the day which is not
less than the number of Business Days specified above for such notice. Optional
prepayments shall be applied to the Notes as set forth in Section 3.9.
Section 3.3 Mandatory Prepayments.
----------------------
(a) Revolving Credit Notes.
16
(i) Asset Sales. Immediately upon the receipt of the proceeds thereof,
Borrower shall prepay the Revolving Credit Notes in an amount equal to the net
proceeds of any sale, liquidation or disposition of any assets of any Company
(other than the Partnerships), where such net proceeds exceed $100,000.00.
(ii) Sale or Issuance of Capital Stock or Debt. Immediately upon the
receipt of the proceeds thereof, Borrower shall prepay the Revolving Credit
Notes in an amount equal to fifty percent (50%) of any Issuance Proceeds.
(iii) American Physicians Service Group. Immediately upon the receipt of
the proceeds of any disposition of the stock of American Physicians Service
Group, Inc. held by any Company, Borrower shall prepay the Revolving Credit
Notes in an amount equal to excess of (A) the net proceeds of any disposition,
over (B) an amount equal to two dollars ($2.00) per share sold or disposed.
(iv) Application of Mandatory Prepayments. Any such mandatory prepayments
of the Revolving Credit Notes shall be applied to the Revolving Credit Notes on
a pro rata basis based upon the outstanding principal balances of such Notes as
of the date of payment. Any such prepayments shall not reduce the Revolving
Credit Commitments.
(b) Term Notes.
-----------
(i) Asset Sales by Partnerships. Immediately upon the receipt of the
proceeds thereof, Borrower shall prepay the Term Notes in an amount equal to the
net proceeds of any sale, liquidation or disposition of any Partnership or of
any assets of any Partnership; provided that such net proceeds shall be limited
to Borrower's or its Wholly-Owned Subsidiary's pro rata portion of such net
proceeds; and provided further that Borrower shall not be required to prepay the
Term Notes to the extent that the net proceeds of any sale, liquidation or
disposition of any assets of any Partnership are used by such Partnership to
replace such assets with assets of similar character within ninety (90) days of
such sale, liquidation or disposition.
(ii) Sale or Issuance of Capital Stock or Debt. Immediately upon the
receipt of the proceeds thereof, Borrower shall prepay the Term Notes in an
amount equal to the lesser of (A) fifty percent (50%) of any Issuance Proceeds,
and (B) the Applicable Payment Amount.
(iii) Excess Cash Flow. Borrower shall prepay the Term Notes within thirty
(30) days of the end of each fiscal quarter of Borrower, commencing with the
fiscal quarter ending on June 30, 1996, in amount equal to the lesser of (A)
seventy-five percent (75%) of Excess Cash Flow for such fiscal quarter, and (B)
the Applicable Payment Amount.
(iv) Application of Mandatory Prepayments. Any mandatory prepayments of the
Term Notes shall be applied to the Term Notes on a pro rata basis based upon the
outstanding principal balances of such Notes as of the date of payment.
Section 3.4 Pro Rata Treatment.
-------------------
Except to the extent otherwise provided herein: (a) each Advance shall be
by the Banks under Section 2.1(a), each payment of commitment fee under Section
2.8(a) shall be made for the account of the Banks, and each termination or
reduction of the Revolving Credit Commitments under Section 2.1(c) or otherwise
shall be applied to the Revolving Credit Commitments of the Banks, pro rata
according to the respective unused Revolving Credit Commitments; (b) the making
and Continuation of Advances shall be made pro rata among the Banks according to
the amounts of their respective Commitments; and (c) each payment and prepayment
of principal of or interest on Advances by Borrower shall be made to the
Administrative Agent for the account of the Banks in accordance with Section
3.9.
Section 3.5 Non-Receipt of Funds by the Administrative Agent.
---------------------------------------------------
Unless the Administrative Agent shall have been notified by a Bank or
Borrower (the "Payor") prior to the date on which such Bank is to make payment
to the Administrative Agent of the proceeds of an Advance to be made by it
hereunder or Borrower is to make a payment to the Administrative Agent for the
account of one or more of the Banks, as the case may be (such payment being
herein called the "Required Payment"), which notice shall be effective upon
receipt, that the Payor does not intend to make the Required Payment to the
Administrative
17
Agent, the Administrative Agent may assume that the Required Payment has been
made and may, in reliance upon such assumption (but shall not be required to),
make the amount thereof available to the intended recipient on such date and, if
the Payor has not in fact made the Required Payment to the Administrative Agent,
the recipient of such payment shall, on demand, return to the Administrative
Agent the amount made available to it together with interest thereon in respect
of the period commencing on the date such amount was so made available by the
Administrative Agent until the date the Administrative Agent recovers such
amount at a rate per annum equal to the Federal Funds Rate for such period.
Section 3.6 Withholding Taxes.
------------------
All payments by Borrower of principal of and interest on the Advances and
of all fees and other amounts payable under any Loan Document are payable
without deduction for or on account of any present or future taxes, duties or
other charges levied or imposed by the United States of America or by the
government of any jurisdiction outside the United States of America or by any
political subdivision or taxing authority of or in any of the foregoing through
withholding or deduction with respect to any such payments. If any such taxes,
duties or other charges are so levied or imposed, Borrower will pay additional
interest or will make additional payments in such amounts so that every net
payment of principal of and interest on the Advances and of all other amounts
payable by any of them under any Loan Document, after withholding or deduction
for or on account of any such present or future taxes, duties or other charges,
will not be less than the amount provided for herein or therein, provided that
Borrower shall have no obligation to pay such additional amounts to any Bank to
the extent that such taxes, duties, or other charges are levied or imposed by
reason of the failure of such Bank to comply with the provisions of Section 3.7.
Borrower shall furnish promptly to the Administrative Agent for distribution to
each affected Bank, as the case may be, official receipts evidencing any such
withholding or reduction.
Section 3.7 Withholding Tax Exemption.
--------------------------
Each Bank that is not incorporated under the laws of the United States of
America or a state thereof agrees that it will deliver to Borrower and the
Administrative Agent two (2) duly completed copies of United States Internal
Revenue Service Form 1001 or 4224, certifying in either case that such Bank is
entitled to receive payments from Borrower under any Loan Document, 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 Borrower
and the Administrative Agent two (2) additional copies of such form (or a
successor form) on or before the date 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 Borrower or the Administrative Agent, in each
case certifying that such Bank is entitled to receive payments from Borrower
under any Loan Document 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 Borrower and the Administrative
Agent that it is not capable of receiving such payments without any deduction or
withholding of United States federal income tax.
Section 3.8 Computation of Interest.
------------------------
Interest on the Eurodollar Advances shall be computed on the basis of a
year of 360 days. Interest on Alternate Base Rate Advances and all other amounts
payable by Borrower hereunder shall be computed on the basis of a year of 365 or
366 days, as the case may be.
Section 3.9 Order of Application.
---------------------
(a) No Default. Prior to the occurrence of an Event of Default, any
voluntary payment may (except as otherwise provided herein) be applied, at the
option of Borrower, to either the Revolving Notes or the Term Notes. Any payment
(whether voluntary or mandatory) of the Revolving Notes shall be applied to the
Revolving Notes on a pro rata basis based upon the outstanding principal
balances of the Revolving Notes as of the date of payment. Any payment of the
Term Notes (whether voluntary or mandatory) shall be applied to the Term Notes
on a pro rata basis based upon the outstanding principal balances of the Term
Notes as of the date of payment, and (x) voluntary prepayments shall be applied
to reduce the payments required by Section 2.3(b) on a pro rata basis, and (y)
mandatory prepayments shall be applied to reduce the payments required by
Section 2.3(b) in the inverse order of maturity.
18
(b) After Default. After the occurrence and during the continuance of an
Event of Default, any payment shall be applied shall be applied in the following
order: (i) to all fees and expenses for which Agents or Banks have not been paid
or reimbursed in accordance with the Loan Documents (and if such payment is less
than all unpaid or unreimbursed fees and expenses, then the payment shall be
paid against unpaid and unreimbursed fees and expenses in the order of
incurrence or due date); (ii) to accrued interest on the Revolving Notes and the
Term Notes on a pro rata basis, based upon the outstanding principal balances of
such Notes as of the date of payment; and (iii) to the principal of the
Revolving Notes and the Term Notes on a pro rata basis, based upon the
outstanding principal balances of such Notes as of the date of payment, and any
such prepayments of the Term Notes shall be applied to reduce the payments
required by Section 2.3(b) in such order as shall be determined by the
Administrative Agent in its sole discretion.
(c) Application to Advances. Subject to the foregoing, and so long as no
Event of Default has occurred and is continuing, payments of principal of any
Note shall be applied to such outstanding Alternate Base Rate Advances and
Eurodollar Advances under such Note as Borrower shall select; provided, however,
that Borrower shall select Alternate Base Rate Advances and Eurodollar Advances
to be repaid in a manner designated to minimize the funding loss required to be
paid pursuant to Section 4.5, if any, resulting from such payment; and provided
further that if Borrower shall fail to select the Alternate Base Rate Advances
and Eurodollar Advances to which such payments are to be applied, or if an Event
of Default has occurred and is continuing at the time of such payment, then the
Administrative Agent shall be entitled to apply the payment to such Advances in
the manner in which it shall deem appropriate in its sole discretion.
ARTICLE IV
YIELD PROTECTION AND ILLEGALITY
Section 4.1 Additional Costs.
-----------------
(a) Borrower hereby agrees to pay directly to each Bank from time to time
such amounts as such Bank may determine to be necessary to compensate it for any
costs incurred by such Bank which such Bank determines are attributable to its
making or maintaining any Eurodollar Advances hereunder or its obligation to
make any of such Advances hereunder, or any reduction in any amount receivable
by such Bank hereunder in respect of any such Advances or such obligation (such
increases in costs and reductions in amounts receivable being herein called
"Additional Costs"), resulting from any Regulatory Change which:
(i) changes the basis of taxation of any amounts payable to such Bank under
this Agreement or its Notes in respect of any of such Advances (other than (1)
taxes imposed on the overall net income of such Bank or its Applicable Lending
Office for any of such Advances, (2) franchise or similar taxes of such Bank,
and (3) amounts withheld pursuant to the last sentence of Section 3.7);
(ii) imposes or modifies any reserve, special deposit, minimum capital,
capital ratio, or similar requirement relating to any extensions of credit or
other assets of, or any deposits with or other liabilities or commitments of,
such Bank; or
(iii) imposes any other Additional Cost affecting this Agreement or the
Notes or any of such extensions, of credit or liabilities or commitments.
Each Bank will notify Borrower of any event occurring after the date of
this Agreement which will entitle such Bank to compensation pursuant to this
Section 4.1(a) as promptly as practicable after it obtains knowledge thereof and
determines to request such compensation, and will designate a different
Applicable Lending Office for the Advances affected by such event if such
designation will avoid the need for, or reduce the amount of, such compensation
and will not, in the sole opinion of such Bank, violate any law, rule, or
regulation or be in any way disadvantageous to such Bank, provided that such
Bank shall have no obligation to so designate an Applicable Lending Office
located outside the United States of America. Each Bank will furnish
19
Borrower with a certificate setting forth the basis and the amount of each
request of such Bank for compensation under this Section 4.1(a). If any Bank
requests compensation from Borrower under this Section 4.1(a), Borrower may, by
notice to such Bank (with a copy to the Administrative Agent) suspend the
obligation of such Bank to make or Continue making Eurodollar Advances until the
Regulatory Change giving rise to such request ceases to be in effect (in which
case such Bank's Eurodollar Advances shall be Converted to Alternate Base Rate
Advances in accordance with the provisions of Section 4.4).
(b) Without limiting the effect of the foregoing provisions of this Section
4.1, in the event that, by reason of any Regulatory Change, any Bank either (i)
incurs Additional Costs based on or measured by the excess above a specified
level of the amount of a category of deposits or other liabilities of such Bank
which includes deposits by reference to which the interest rate on Eurodollar
Advances is determined as provided in this Agreement or a category of extensions
of credit or other assets of such Bank which includes Eurodollar Advances or
(ii) becomes subject to restrictions on the amount of such a category of
liabilities or assets which it may hold, then, if such Bank so elects by notice
to Borrower (with a copy to the Administrative Agent), the obligation of such
Bank to make or Continue making Eurodollar Advances hereunder shall be suspended
until such Regulatory Change ceases to be in effect (in which case such Bank's
Eurodollar Advances shall be Converted to Alternate Base Rate Advances in
accordance with the provisions of Section 4.4).
(c) Determinations and allocations by any Bank for purposes of this Section
4.1 of the effect of any Regulatory Change on its costs of maintaining its
obligations to make Advances or of making or maintaining Advances or on amounts
receivable by it in respect of Advances, and of the additional amounts required
to compensate such Bank in respect of any Additional Costs, shall be conclusive,
absent manifest error and provided that such determinations and allocations are
made on a reasonable basis.
Section 4.2 Limitation on Eurodollar Advances.
-------------------------------------
Anything herein to the contrary notwithstanding, if with respect to any
Eurodollar Advance for any Interest Period therefor:
(a) The Administrative Agent determines (which determination shall be
conclusive absent manifest error) that quotations of interest rates for the
relevant deposits referred to in the definition of "Eurodollar Rate" in Section
1.1 are not being provided in the relative amounts or for the relative
maturities for purposes of determining the rate of interest for such Advances as
provided in this Agreement; or
(b) The Required Banks determine (which determination shall be conclusive
absent manifest error) and notify the Administrative Agent that the rate of
interest referred to in the definition of "Eurodollar Rate" in Section 1.1 on
the basis of which the rate of interest for such Advances for such Interest
Period is to be determined do not accurately reflect the cost to the Banks of
making or maintaining such Advances for such Interest Period;
then the Administrative Agent shall give Borrower prompt notice thereof
specifying the relevant amounts or periods, and so long as such condition
remains in effect, the Banks shall be under no obligation to make or Continue
additional Eurodollar Advances and Borrower shall, on the last day(s) of the
then-current Interest Period(s) for the outstanding Eurodollar Advances, prepay
such Eurodollar Advances or Convert them to Alternate Base Rate Advances in
accordance with Section 4.4.
Section 4.3 Illegality.
-----------
Notwithstanding any other provision of this Agreement, in the event that it
becomes unlawful for any Bank or its Applicable Lending Office to (a) honor its
obligation to make Eurodollar Advances hereunder, or (b) maintain Eurodollar
Advances hereunder, then such Bank shall promptly notify Borrower (with a copy
to the Administrative Agent) thereof and such Bank's obligation to make or
maintain Eurodollar Advances shall be suspended until such time as such Bank may
again make and maintain Eurodollar Advances (in which case such Bank's
Eurodollar Advances shall be Converted to Alternate Base Rate Advances in
accordance with the provisions of Section 4.4).
Section 4.4 Treatment of Eurodollar Advances.
---------------------------------
If the Eurodollar Advances of any Bank are to be Converted pursuant to
Section 4.1, 4.2 or 4.3, such Bank's Eurodollar Advances shall be automatically
Converted into Alternate Base Rate Advances on the last day(s) of the then
current Interest Period(s) for the Eurodollar Advances (or, in the case of a
Conversion required by Section 4.1(b) or 4.3(b), on such earlier date as such
Bank may specify to Borrower with a copy to the
20
Administrative Agent) and, unless and until such Bank gives notice as provided
below that the circumstances specified in Section 4.1, 4.2 or 4.3 which gave
rise to such Conversion no longer exist:
(a) To the extent that such Bank's Eurodollar Advances have been so
Converted, all payments and prepayments of principal which would otherwise be
applied to such Bank's Eurodollar Advances shall be applied instead to its
Alternate Base Rate Advances; and
(b) All Advances which would otherwise be made or Continued by such Bank as
Eurodollar Advances shall be made as or Converted into Alternate Base Rate
Advances.
If such Bank gives notice to Borrower (with a copy to the Administrative
Agent) that the circumstances specified in Section 4.1, 4.2 or Section 4.3 which
gave rise to the Conversion of such Bank's Eurodollar Advances pursuant to this
Section 4.4 no longer exist (which such Bank agrees to do promptly upon such
circumstances ceasing to exist) at a time when Advances are outstanding, such
Bank's Alternate Base Rate Advances shall be automatically Converted, on the
first day(s) of the next succeeding Interest Period(s) for such outstanding
Eurodollar Advances to the extent necessary so that, after giving effect
thereto, all Eurodollar Advances held by the Banks holding the same are held pro
rata (as to principal amounts and Interest Periods) in accordance with their
respective Commitments.
Section 4.5 Compensation.
-------------
Borrower shall pay to the Administrative Agent, for the account of each
Bank, upon the request of such Bank through the Administrative Agent, such
amount or amounts as shall be sufficient (in the reasonable opinion of such
Bank) to compensate it for any loss, cost, or expense incurred by it as a result
of:
(a) Any payment, prepayment or Conversion of a Eurodollar Advance for any
reason (including, without limitation, the acceleration of the outstanding
Advances pursuant to Section 11.2) on a date other than the last day of an
Interest Period for such Advance; or
(b) Any failure by Borrower for any reason (including, without limitation,
the failure of any conditions precedent specified in Article VI to be satisfied)
to borrow or prepay a Eurodollar Advance on the date for such borrowing or
prepayment, specified in the relevant notice of borrowing or prepayment under
this Agreement.
Such compensation shall not exceed the excess, if any, of (i) the amount of
interest which otherwise would have accrued on the principal amount so paid or
not borrowed for the period from the date of such payment or failure to borrow
to the last day of the Interest Period for such Advance (or, in the case of a
failure to borrow, the Interest Period for such Advance which would have
commenced on the date specified for such borrowing) at the applicable rate of
interest for such Advance provided for herein over (ii) the interest component
of the amount such Bank would have bid in the London interbank market for Dollar
deposits of leading banks and amounts comparable to such principal amount and
with maturities comparable to such period.
Section 4.6 Capital Adequacy.
-----------------
If after the date hereof, any Bank shall have determined that the adoption
or implementation of any applicable law, rule, or regulation regarding capital
adequacy (including, without limitation, any law, rule, or regulation
implementing the Basle Accord), or any change therein, or any change in the
interpretation or administration thereof by any central bank or other
Governmental Authority charged with the interpretation or administration
thereof, or compliance by such Bank (or its parent) with any guideline, request,
or directive regarding capital adequacy (whether or not having the force of law)
of any central bank or other Governmental Authority (including, without
limitation, any guideline or other requirement implementing the Basle Accord),
has or would have the effect of reducing the rate of return on such Bank's (or
its parent's) capital as a consequence of its obligations hereunder or the
transactions contemplated hereby to a level below that which such Bank (or its
parent) could have achieved but for such adoption, implementation, change or
compliance (taking into consideration such Bank's policies with respect to
capital adequacy) by an amount deemed by such Bank to be material, then from
time to time, within ten (10) Business Days after demand by such Bank (with a
copy to the Administrative Agent), which demand shall be delivered by such Bank
to Borrower as promptly as practicable after such Bank obtains knowledge of such
reduction in its rate of return, Borrower shall pay to such Bank such additional
amount or amounts as will compensate such Bank (or its parent) for such
reduction. A certificate of such Bank claiming compensation under this Section
and setting forth
21
the additional amount or amounts to be paid to it hereunder shall be conclusive,
absent manifest error and provided that the determination thereof is made on a
reasonable basis. In determining such amount or amounts, such Bank may use any
reasonable averaging and attribution methods.
ARTICLE V
SECURITY
Section 5.1 Collateral.
-----------
To secure the full and complete payment and performance of the Obligations,
Borrower shall execute and deliver or cause to be executed and delivered the
documents described below covering the property and collateral described therein
(which, together with any other property and collateral which may now or
hereafter secure the Obligations or any part thereof, is sometimes herein called
the "Collateral"):
(a) Borrower shall execute and deliver to the Administrative Agent, for the
benefit of the Banks, the Borrower Security Agreement.
(b) The Guarantors shall execute and deliver to the Administrative Agent,
for the benefit of the Banks, the Guarantor Security Agreements.
(c) Pledgors shall execute and deliver to the Administrative Agent, for the
benefit of the Banks, the Pledge Agreements.
(d) Borrower shall execute and cause to be executed such further documents
and instruments, including without limitation, Uniform Commercial Code financing
statements, as the Administrative Agent and the Documentation Agent, in their
sole discretion, deem necessary or desirable to evidence and perfect the
Administrative Agent's liens and security interests in the Collateral.
Section 5.2 Setoff.
-------
If an Event of Default shall have occurred and is continuing, each Bank is
hereby authorized at any time and from time to time, without notice to Borrower
(any such notice being hereby expressly waived by Borrower), to set off and
apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by such Bank to
or for the credit or the account of Borrower against any and all of the
obligations of Borrower now or hereafter existing under this Agreement, such
Bank's Notes, or any other Loan Document, irrespective of whether or not the
Administrative Agent or such Bank shall have made any demand under this
Agreement or such Bank's Notes or such other Loan Document and although such
obligations may be unmatured. Each Bank agrees promptly to notify Borrower (with
a copy to the Administrative Agent) after any such setoff and application,
provided that the failure to give such notice shall not affect the validity of
such setoff and application. The rights and remedies of each Bank hereunder are
in addition to other rights and remedies (including, without limitation, other
rights of setoff) which such Bank may have.
Section 5.3 Guaranties.
-----------
Each Guarantor shall unconditionally and irrevocably guarantee the payment
and performance of the Obligations by execution and delivery of the Guaranties.
ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1 Initial Advance.
-----------------
The obligation of each Bank to make its initial Advance is subject to the
condition precedent that the Documentation Agent shall have received on or
before the day of such Advance all of the following, each dated (unless
otherwise indicated) the date hereof, in form and substance satisfactory to the
Documentation Agent:
22
(a) Resolutions. Resolutions of the Boards of Directors of Borrower and
each Guarantor certified by the Secretary or an Assistant Secretary of each of
them which authorize the execution, delivery, and performance by such Company of
this Agreement and/or the other Loan Documents to which such Company is or is to
be a party;
(b) Incumbency Certificate. A certificate of incumbency certified by the
Secretary or an Assistant Secretary of Borrower and each Guarantor certifying
the names of the officers of each such Company, authorized to sign this
Agreement and each of the other Loan Documents to which each such Company is or
is to be a party (including the certificates contemplated herein) together with
specimen signatures of such officers;
(c) Articles of Incorporation. The articles of incorporation of Borrower
and each Guarantor certified, in the case of Borrower, by the Secretary of State
of Delaware, and, in the case of each Guarantor, by the Secretary or an
Assistant Secretary of such Company;
(d) Bylaws. The bylaws of Borrower and each Guarantor certified by the
Secretary or an Assistant Secretary of each such Company;
(e) Governmental Certificates. Certificates of the appropriate government
officials of the state of incorporation of Borrower and each Guarantor as to the
existence and good standing of each of them;
(f) Notes. The Notes executed by Borrower;
(g) Borrower Security Agreement. The Borrower Security Agreement executed
by Borrower;
(h) Guaranties. The Guaranties executed by the Guarantors;
(i) Guarantor Security Agreement. The Guarantor Security Agreements
executed by the Guarantors;
(j) Pledge Agreements. The Pledge Agreements executed by the Pledgors;
(k) Financing Statements. Uniform Commercial Code financing statements
executed by Borrower and each Guarantor and covering the Collateral;
(l) Stock Certificates. Stock certificates evidencing all stock pledged
pursuant to the Borrower Security Agreement and each Guarantor Security
Agreement, as applicable, together with stock powers duly executed in blank;
(m) Certificates of Title. Original certificates of title, together with
executed applications for title, for all vehicles used in connection with the
transportation of lithotripters pledged pursuant to the Borrower Security
Agreement and the Guarantor Security Agreements;
(n) Insurance Policies. Copies of all insurance policies required by
Section 8.5, together with loss payee endorsements in favor of the
Administrative Agent, for the benefit of the Banks, with respect to all
insurance policies covering Collateral;
(o) UCC and Tax and Judgment Lien Searches. The results of Uniform
Commercial Code searches showing all financing statements and other documents or
instruments, and tax and judgment lien searches showing all tax and judgment
liens, on file against each Company in such jurisdictions as the Administrative
Agent shall require, such searches to be as of a date no more than twenty (20)
days prior to the date of the initial Advance;
(p) Perfection Certificate. A Perfection Certificate, in substantially the
form of Exhibit I hereto, properly completed and signed by the Chief Executive
or Chief Financial Officer of Borrower and the Guarantors;
23
(q) Opinion of Counsel. Favorable opinions as to the matters set forth in
Exhibit J hereto of (i) ▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, special Texas legal counsel
to Borrower and the Guarantors, (ii) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, special
North Carolina counsel to Litho, (iii) ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇, special
Massachusetts legal counsel to the Agents and the Banks, and (iv) ▇▇▇▇▇ & ▇▇▇
▇▇▇▇▇, L.L.C., special North Carolina counsel to the Agents and the Banks;
(r) Attorneys' Fees and Expenses. Evidence that the costs and expenses
(including attorneys' fees) referred to in Section 13.1, to the extent incurred,
shall have been paid in full by Borrower;
(s) Fees. Borrower shall have paid to the Agents for their own account, the
fees owed by Borrower to the Agents pursuant to the letter agreements of even
date herewith between Borrower and the Agents;
(t) Federal Reserve Board Form U-1. For each Bank a properly completed
Federal Reserve Board Form U-1 duly executed by each Company pledging stock of
another Company; and
(u) Acquisition of Litho. Borrower shall have acquired good title, free and
clear of all Liens, to all of the issued and outstanding capital stock of Litho.
Section 6.2 All Advances.
-------------
The obligation of each Bank to make any Advance (including the initial
Advance) is subject to the following additional conditions precedent:
(a) Advance Request Form. The Administrative Agent shall have received, in
accordance with Section 2.5, an Advance Request Form executed by an authorized
officer of Borrower;
(b) No Default. No Default shall have occurred and be continuing, or would
result from such Advance;
(c) Representations and Warranties. All of the representations and
warranties contained in Article VII hereof and in each of the other Loan
Documents shall be true and correct on and as of the date of such Advance with
the same force and effect as if such representations and warranties had been
made on and as of such date, except to the extent that such representations and
warranties speak to a specific date or the facts on which such representations
and warranties are based have been changed by transactions contemplated by the
Loan Documents; and
(d) Additional Documentation. The Administrative Agent shall have received
such additional approvals, opinions, or documents as are required by the terms
and provisions of this Agreement or any other Loan Document.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
To induce the Agents and the Banks to enter into this Agreement, Borrower
hereby represents and warrants to the Agents and the Banks that:
Section 7.1 Existence.
----------
(a) Corporate Existence. Each of the Companies (other than the
Partnerships): (a) is a corporation duly organized, validly existing, and in
good standing under the laws of the jurisdiction of its incorporation; (b) has
all requisite corporate power and authority to own its assets and carry on its
business as now being or as proposed to be conducted; and (c) is qualified to do
business in all jurisdictions in which the nature of its business makes such
qualification necessary and where failure to so qualify would have a material
adverse effect on the business, condition (financial or otherwise), operations,
or properties of the Companies taken as a whole, Borrower, or any Material
Subsidiary. Each Company has the corporate power and authority to execute,
deliver, and perform its obligations under this Agreement and the other Loan
Documents to which it is or may become a party.
24
(b) Partnership Existence. Each of the Partnerships: (a) is a general
partnership, limited partnership or limited liability company, as appropriate,
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its formation; (b) has all requisite partnership power and
authority or company power and authority, as appropriate, to own its assets and
carry on its business as now being or as proposed to be conducted; and (c) is
qualified to do business in all jurisdictions in which the nature of its
business makes such qualification necessary and where failure to so qualify
would have a material adverse effect on the business, condition (financial or
otherwise), operations, or properties of the Companies taken as a whole,
Borrower, or any Material Subsidiary.
Section 7.2 Financial Statements.
-----------------------
Borrower has delivered to the Administrative Agent (a) audited consolidated
financial statements of the Companies as of and for the fiscal year ended
December 31, 1995, and unaudited consolidated financial statements of Borrower
for the two (2) month period ended February 29, 1996, and (b) audited
consolidated financial statements of Litho and the Partnerships as of and for
the fiscal years ended December 31, 1995, December 31, 1994 and December 31,
1993. Such financial statements have been prepared in accordance with GAAP, and
fairly present, on a consolidated basis, the financial condition of the
Companies and Litho and the Partnerships, as appropriate, as of the respective
dates indicated therein and the results of operations for the respective periods
indicated therein. There has been no material adverse change in the business,
condition (financial or otherwise), operations, or properties of the Companies
taken as a whole, Borrower, or any Material Subsidiary since the effective date
of the most recent financial statements referred to in this Section.
Section 7.3 Corporate Action: No Breach.
------------------------------
The execution, delivery, and performance by each Company of this Agreement
and the other Loan Documents to which such Company is or may become a party and
compliance with the terms and provisions hereof and thereof have been duly
authorized by all requisite corporate action (or, if such Company is a
partnership, then partnership action) on the part of such Company and do not and
will not (a) violate or conflict with, or result in a breach of, or require any
consent under (i) the articles of incorporation or bylaws of such Company (or,
if such Company is a partnership, then the partnership agreement of such
Company), (ii) any material applicable law, rule, or regulation or any material
order, writ, injunction, or decree of any Governmental Authority or arbitrator,
or (iii) any material agreement or instrument to which such Company is a party
or by which such Company or any of its property is bound or subject (other than
agreements and instruments relating to Debt which will be paid off with the
proceeds of the initial Advance), or (b) constitute a material default under any
such agreement or instrument (other than agreements and instruments relating to
Debt which will be paid off with the proceeds of the initial Advance), or result
in the creation or imposition of any Lien (except as provided in Article V) upon
any of the revenues or assets of any of the Companies.
Section 7.4 Operation of Business.
----------------------
Each of the Companies possesses all licenses, permits, franchises, patents,
copyrights, trademarks, and tradenames, or rights thereto, necessary to conduct
their respective businesses substantially as now conducted and as presently
proposed to be conducted. None of the Companies is in violation of any valid
rights of others with respect to any of the foregoing (except where the failure
to do so would not have a material adverse effect on the business, condition
(financial or otherwise), operations or properties of the Companies taken as a
whole, Borrower, or any Material Subsidiary).
Section 7.5 Litigation and Judgments.
---------------------------
As of the date hereof, except as disclosed on Schedule 7.5 hereto, there is
no action, suit, investigation, or proceeding before or by any Governmental
Authority or arbitrator pending, or to the knowledge of Borrower, threatened
against or affecting any of the Companies, that would, if adversely determined,
have a material adverse effect on the business, condition (financial or
otherwise), operations or properties of the Companies taken as a whole,
Borrower, or any Material Subsidiary or the ability of Borrower to pay and
perform the Obligations. There are no outstanding judgments against any Company.
Section 7.6 Rights in Properties; Liens.
----------------------------
Each of the Companies has good and indefeasible title to or valid leasehold
interests in their respective material properties and assets, real and personal,
including the properties, assets, and leasehold interests reflected in the
financial statements described in Section 7.2, and none of the properties,
assets, or leasehold interests of any Company is subject to any Lien, except as
permitted by Section 9.2.
25
Section 7.7 Enforceability.
---------------
This Agreement constitutes, and the other Loan Documents to which Borrower
is a party, when delivered, shall constitute the legal, valid, and binding
obligations of Borrower, enforceable against Borrower in accordance with their
respective terms, except as limited by bankruptcy, insolvency, or other laws of
general application relating to the enforcement of creditors' rights. The Loan
Documents to which each Guarantor is a party, when delivered, shall constitute
the legal, valid, and binding obligations of such Guarantor, enforceable against
such Guarantor in accordance with their respective terms, except as limited by
bankruptcy, insolvency, or other laws of general application relating to the
enforcement of creditors' rights.
Section 7.8 Approvals.
----------
No authorization, approval, or consent of, and no filing or registration
with, any Governmental Authority or third party is or will be necessary for the
execution, delivery, or performance by Borrower or any Guarantor of this
Agreement and the other Loan Documents to which Borrower or any Guarantor is or
may become a party or for the validity or enforceability thereof.
Section 7.9 Debt.
-----
As of the date hereof, the Companies have no Debt, except as disclosed on
Schedule 7.9.
Section 7.10 Taxes.
------
The Companies have filed or extended all tax returns (federal, state, and
local) required to be filed, including all income, franchise, employment,
property, and sales tax returns, and have paid all of their respective
liabilities for taxes, assessments, governmental charges, and other levies that
are due and payable. Except as previously disclosed to the Administrative Agent
in writing, no Company knows of any pending investigation of any of them by any
taxing authority or of any pending but unassessed tax liability of any of them.
Section 7.11 Use of Proceeds; Margin Securities.
--------------------------------------
No Company is engaged principally, or as one of its important activities,
in the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulations G, T, U, or X of the Board of
Governors of the Federal Reserve System), and no part of the proceeds of any
Advance will be used to purchase or carry any margin stock or to extend credit
to others for the purpose of purchasing or carrying margin stock, except for
purchases of Borrower's capital stock permitted by Section 9.4 hereof.
Section 7.12 ERISA.
------
The Companies are in compliance in all material respects with all
applicable provisions of ERISA. Neither a Reportable Event nor a Prohibited
Transaction has occurred and is continuing with respect to any Plan. No notice
of intent to terminate a Plan has been filed, nor has any Plan been terminated.
No circumstances exist which constitute grounds entitling the PBGC to institute
proceedings to terminate, or appoint a trustee to administer, a Plan, nor has
the PBGC instituted any such proceedings. None of the Companies nor any ERISA
Affiliate has completely or partially withdrawn from a Multi-employer Plan. The
Companies and each ERISA Affiliate have met their minimum funding requirements
under ERISA with respect to all of their Plans, and the present value of all
vested benefits under each Plan does not exceed the fair market value of all
Plan assets allocable to such benefits, as determined on the most recent
valuation, date of the Plan and in accordance with ERISA. None of the Companies
nor any ERISA Affiliate has incurred any liability to the PBGC under ERISA.
Section 7.13 Disclosure.
-----------
All factual information (taken as a whole) furnished by or on behalf of
Borrower in writing to any Agent or any Bank (including, without limitation, all
factual information contained in the Loan Documents) for purposes of or in
connection with this Agreement, the other Loan Documents or any transaction
contemplated herein or therein is, and all other such factual information (taken
as a whole) hereafter furnished by or on behalf of Borrower in writing will be,
true and accurate in all material respects on the date as of which such factual
information is dated or certified and is not (and such factual information
(taken as a whole) hereafter furnished will not be) incomplete by omitting to
state any facts necessary to make such factual information (taken as a whole)
not misleading in any material respect at such time in light of the
circumstances under which such factual information was provided.
Section 7.14 Subsidiaries; Partnerships.
---------------------------
Each of the Guarantors is a direct or indirect wholly-owned Subsidiary of
Borrower, and as of the date hereof, together with the Partnerships listed on
Schedule 3, constitute all of the Subsidiaries of Borrower. Schedule 7.14.1, as
the same may be amended from time to time to reflect transactions permitted by
this Agreement, sets forth the outstanding shares of capital stock (or other
ownership interests) and the name of each shareholder of each of the
Subsidiaries of Borrower. All of the outstanding capital stock of Borrower and
each of its Subsidiaries has been validly issued,
26
is fully paid, and is nonassessable. Schedule 7.14.2, as the same may be amended
from time to time to reflect transactions permitted by this Agreement, sets
forth the outstanding partnership interests of the Partnerships owned by each of
the Companies.
Section 7.15 Agreements.
-----------
Except as set forth on Schedule 7.15, none of the Companies is a party to
any indenture, loan, or credit agreement, or to any lease or other agreement or
instrument, or subject to any charter or corporate restriction which could
reasonably be expected to have a material adverse effect on the business,
condition (financial or otherwise), operations or properties of the Companies
taken as a whole, Borrower, or any Material Subsidiary or the ability of
Borrower or any Guarantor to pay and perform its obligations under the Loan
Documents to which it is a party. None of the Companies is in default in any
material respect in the performance, observance, or fulfillment of any of the
obligations, covenants, or conditions contained in any agreement or instrument
to which it is a party, which default, in the aggregate with all such other
defaults, would have a material adverse affect on the business, condition
(financial or otherwise), operations or properties of the Companies taken as a
whole, Borrower, or any Material Subsidiary.
Section 7.16 Compliance with Legal Requirements; Governmental
Authorizations.
-------------------------------------------------
(a) Except as set forth in Schedule 7.16.1: (i) each Company is in
compliance in all material respects with each Legal Requirement that is or was
applicable to it or to the conduct or operation of its business or the ownership
or use of any of its assets; and (ii) no Company has received any notice or
other communication from any Governmental Authority or other Person of any event
or circumstance which could constitute a violation of, or failure to comply
with, any Legal Requirement.
(b) Except as set forth in Schedule 7.16: (i) each Company is in material
compliance with all of the terms and requirements of each Governmental
Authorization held by such Company; (ii) no Company has received any notice or
other communication from any Governmental Authority or other Person of, any
event or circumstance which could constitute a violation of, or failure to
comply with, any term or requirement of any Governmental Authorization, or of
any actual or potential revocation, withdrawal, cancellation or termination of,
or material modification to, any Governmental Authorization; (iii) all
applications required to have been filed for the renewal of any required
Governmental Authorizations have been duly filed on a timely basis with the
appropriate Governmental Authorities, and all other filings required to have
been made with respect to such Governmental Authorizations have been duly made
on a timely basis with the appropriate Governmental Authorities; (iv) all
Governmental Authorizations of the Companies are transferable to the Companies;
(v) upon consummation of the transactions contemplated hereby, the Companies
will lawfully hold all such Governmental Authorizations; and (vi) none of such
Governmental Authorizations will terminate upon consummation of the transactions
contemplated hereby. Except as set forth on Schedule 7.16, each of the Companies
possesses the necessary Governmental Authorizations (i) necessary to permit each
Company to lawfully conduct and operate its respective business in the manner it
currently conducts and operates such business and to permit such Company to own
and use its assets in the manner in which it currently owns and uses such
assets, and (ii) necessary to permit each Company, upon the consummation of the
transactions contemplated hereby, to lawfully conduct and operate its business
and to permit each Company to own and use its assets, where the failure to have
such Governmental Authorization would have a material adverse effect on the
business, condition (financial or otherwise), operations or properties of the
Companies taken as a whole, Borrower, or any Material Subsidiary.
Section 7.17 Investment Company Act.
-----------------------
No Company is an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
Section 7.18 Public Utility Holding Company Act.
--------------------------------------
No Company is a "holding company" or a "subsidiary company" of a "holding
company" or an "affiliate" of a "holding company" or a "public utility" within
the meaning of the Public Utility Holding Company Act of 1935, as amended.
Section 7.19 Environmental Matters.
-----------------------
Except as disclosed on Schedule 7.19, as the same may be amended from time
to time, hereto:
(a) Each of the Companies and all of their respective properties, assets,
and operations are in compliance in all material respects with all Environmental
Laws. No Company is aware of, nor have any of them received notice of, any past,
27
present, or future conditions, events, activities, practices, or incidents which
may interfere with or prevent the material compliance or continued material
compliance of any Company with all material Environmental Laws; and
(b) The Companies have obtained all material permits, licenses and
authorizations that are required under applicable Environmental Laws, and all
such permits are in good standing and each Company is in compliance is all
material respects with all of the terms and conditions of such permits.
Section 7.20 Acquisition.
-------------
The Stock Purchase Agreement dated April 26, 1996, executed by Borrower,
Litho, and the Sellers defined therein previously delivered to the Agents and
the Banks is a true and correct copy of such agreement, and Borrower has
delivered to the Agents and the Banks true and correct copies of all amendments,
supplements and modifications thereto. Borrower has provided to the Agents and
the Banks all material information possessed by Borrower or of which Borrower is
aware regarding the acquisition by Borrower of the Acquisition of Litho.
ARTICLE VIII
POSITIVE COVENANTS
Borrower hereby covenants and agrees that, as long as the Obligations or
any part thereof are outstanding or any Bank has any Commitment hereunder,
Borrower will perform and observe each of the following positive covenants:
Section 8.1 Reporting Requirements.
-------------------------
Borrower will furnish to the Administrative Agent and each Bank:
(a) Annual Financial Statements. As soon as available, and in any event
within ninety-five (95) days after the end of each fiscal year of Borrower,
beginning with the fiscal year ending December 31, 1996, a copy of the annual
audit report of the Companies for such fiscal year containing, on a consolidated
and consolidating basis, balance sheets and statements of income, retained
earnings, and cash flow as at the end of such fiscal year and for the twelve
(12)-month period then ended, in each case setting forth in comparative form the
figures for the preceding fiscal year, audited by independent certified public
accountants of recognized standing, and accompanied by an opinion of such
independent certified public accountants stating that such report has been
prepared in accordance with GAAP;
(b) Monthly Financial Statements. As soon as available, and in any event
within forty (40) days after the end of each month of each fiscal year of
Borrower, a copy of an unaudited financial report of the Companies as of the end
of such month and for the portion of the fiscal year then ended, containing, on
a consolidated and consolidating basis, balance sheets and statements of income
(together with a breakdown of revenues by customer and procedure, and of
expenses by procedure), retained earnings, and cash flow, in each case setting
forth in comparative form the figures for the corresponding period of the
preceding fiscal year, certified by the chief financial officer of Borrower to
have been prepared in accordance with GAAP and to fairly and accurately present
(subject to year-end audit adjustments) the financial condition and results of
operations of the Companies, on a consolidated and consolidating basis, at the
date and for the periods indicated therein;
(c) Compliance Certificate. Concurrently with the delivery of each of the
financial statements referred to in Section 8.1(a) and within forty (40) days
after the end of each of the first three (3) fiscal quarters of each fiscal year
of Borrower, a certificate of the chief executive or chief financial officer of
Borrower, in substantially the form of Exhibit K, (i) stating that to such
officer's knowledge, no Default has occurred and is continuing, or if a Default
has occurred and is continuing, a statement as to the nature thereof and the
action that is proposed to be taken with respect thereto, and (ii) showing in
reasonable detail the calculations demonstrating compliance with Article X;
(d) Accounts Receivable Aging Report. As soon as available and in any event
within forty (40) days after the end of each month, an aged listing of the
accounts receivable of each of Borrower and its Subsidiaries as of the end of
such month in a form reasonably satisfactory to the Administrative Agent;
28
(e) Business Plan and Budget. As soon as available and in any event by
December 15 of each year, a copy of the annual budget and business plan of
Borrower and its Subsidiaries for the upcoming fiscal year, together with
details of the assumptions, if any, underlying such budget and business plan;
(f) Management Letters. Promptly upon receipt thereof, a copy of any
management letter or written report submitted to any Company by independent
certified public accountants with respect to the business, condition (financial
or otherwise), operations, or properties of any Company;
(g) Notice of Litigation. Promptly after the commencement thereof, notice
of all actions, suits, and proceedings before any Governmental Authority or
arbitrator affecting Borrower or any of its Subsidiaries which, if determined
adversely to Borrower or any such Subsidiary, could have a material adverse
effect on the business, condition (financial or otherwise), options, or
properties of Borrower, any Subsidiary or the Companies (taken as a whole);
(h) Notice of Default. As soon as possible and in any event within five (5)
days after Borrower knows of the occurrence of each Default, a written notice
setting forth the details of such Default and the action that Borrower has taken
and proposes to take with respect thereto;
(i) ERISA Reports. Promptly after the filing or receipt thereof, copies of
all reports, including annual reports, and notices which any Company files with
or receives from the PBGC or the U.S. Department of Labor under ERISA; and as
soon as possible and in any event within five (5) days after any Company knows
or has reason to know that any Reportable Event or Prohibited Transaction has
occurred with respect to any Plan or that the PBGC, or any Company has
instituted or will institute proceedings under Title IV of ERISA to terminate
any Plan, a certificate of the chief financial officer of Borrower setting forth
the details as to such Reportable Event or Prohibited Transaction or Plan
termination and the action that Borrower proposes to take with respect thereto;
(j) Reports to Other Creditors. Promptly after the furnishing thereof,
copies of any statement or report furnished by Borrower or any of its
Subsidiaries to any other creditor to which any Company owes $250,000.00 or more
pursuant to the terms of any indenture, loan, or credit or similar agreement and
not otherwise required to be furnished to the Administrative Agent and the Banks
pursuant to any other clause of this Section;
(k) Proxy Statements, Etc. As soon as available, one (1) copy of each
financial statement, report, notice or proxy statement sent by Borrower to its
stockholders generally and one (1) copy of each regular, periodic or special
report, registration statement, or prospectus filed by Borrower with any
securities exchange or the Securities and Exchange Commission or any successor
agency including, without limitation, all Forms 10-K, 10-Q and 8-K and all other
periodic reports required to be filed under the Securities Exchange Act of 1934
and the rules and regulations promulgated thereunder;
(l) Partnership Lists. As soon as available, and in any event (a) within
thirty (30) days after the end of each fiscal quarter of Borrower, a list of the
names of each partner of each of the Partnerships and as soon as available, and
(b) within thirty (30) days after the date hereof and thereafter within thirty
(30) days after the end of each fiscal year of Borrower, or upon the occurrence
and during the continuance of an Event of Default, a list of the names and
addresses of each partner of each of the Partnerships;
(m) Governmental Authorizations. Upon the request of the Administrative
Agent, but not more often than one (1) time during each fiscal year of Borrower,
a complete and accurate list of each Governmental Authorization held by each of
Companies or that otherwise relate to the business of, or to any of the assets
owned or used by, each of the Companies;
(n) Litho and Partnership Statements.
(i) As soon as available, and in any event within thirty (30) days after
the date hereof, unaudited consolidated financial statements of Litho and the
Partnerships for the three (3) month period ended March 31, 1996
29
and the four (4) month period ended April 30, 1996, which financial
statements shall not reflect a material adverse change in the financial
condition of Litho and the Partnerships since the statements referred to in
Section 7.2;
(ii) As soon as available, and in any event within thirty (30) days after
the end of each fiscal quarter of Borrower, beginning with the fiscal quarter
ended September 30, 1996, income and cash flow statements for each of the
Partnerships on a consolidated and consolidating basis;
(o) Partnership Actions. Promptly after the incurrence thereof, notice of
any Partnership's (i) incurrence of Debt, (ii) change in accounting treatment or
reporting practices (which change shall not affect any reporting requirements
set forth herein or the Loan Documents), except as permitted by GAAP and
disclosed to the Administrative Agent, (iii) change in tax reporting treatment,
except as permitted by law, (iv) amendment of any partnership agreement or
management agreement between such Partnership and any Company and copies of any
such amendment certified by an officer of Borrower as being true and correct,
and (v) change in its insurance; and
(p) General Information. Promptly, such other information concerning
Borrower or any of its Subsidiaries as the Administrative Agent or any Bank may
from time to time reasonably request.
Section 8.2 Maintenance of Existence; Conduct of Business.
----------------------------------------------
Borrower will preserve and maintain its corporate existence and all of its
leases, privileges, licenses, permits, franchises, qualifications, and rights
that are necessary or desirable in the ordinary conduct of its business.
Borrower will cause each of its Subsidiaries to preserve and maintain its
corporate, partnership or other similar existence and all of its leases,
privileges, licenses, permits, franchises, qualifications and rights that are
necessary or desirable in the ordinary conduct of its business, except, in each
case, where failure to do so would not have a material adverse effect on the
business, condition (financial or otherwise), operations or properties of the
Companies taken as a whole, Borrower, or any Material Subsidiary. Borrower will
conduct, and will cause each of its Subsidiaries to conduct, its business in an
orderly and efficient manner in accordance with good business practices.
Section 8.3 Maintenance of Properties.
--------------------------
Borrower will maintain, keep, and preserve, and cause each of its
Subsidiaries to maintain, keep, and preserve, all of its properties (tangible
and intangible) necessary or useful in the proper conduct of its business in
good working order and condition, except, in each case, as permitted by Section
9.8 or 9.9 or where the failure to do so would not have a material adverse
effect on the business, condition (financial or otherwise), operations or
properties of the Companies taken as a whole, Borrower, or any Material
Subsidiary.
Section 8.4 Taxes and Claims.
-----------------
Borrower will pay or discharge, and will cause each of its Subsidiaries to
pay or discharge, at or before maturity or before becoming delinquent (a) all
material taxes, levies, assessments, and governmental charges imposed on it or
its income or profits or any of its material property, and (b) all material
lawful claims for labor, material, and supplies, which, if unpaid, might become
a Lien upon any of its property; provided, however, that no Company shall be
required to pay or discharge any tax, levy, assessment, or governmental charge
which is being contested in good faith by appropriate proceedings diligently
pursued, and for which adequate reserves have been established.
Section 8.5 Insurance.
----------
Borrower will maintain, and will cause each of its Subsidiaries to maintain
(except in the case of the Partnerships, in which case Borrower shall maintain
for the Partnerships), insurance with financially sound and reputable insurance
companies in such amounts and covering such risks as is usually carried by
corporations engaged in similar businesses and owning similar properties in the
same general areas in which the Companies operate, consistent with past
practices of the Companies and to the extent available on commercially
reasonable terms, provided that in any event Borrower will maintain and cause
each of its Subsidiaries (except in the case of the Partnerships, in which case
Borrower shall maintain for the Partnerships) to maintain workmen's compensation
insurance, property insurance, comprehensive general liability insurance,
professional liability insurance, and business interruption insurance reasonably
satisfactory to the Banks. Each insurance policy covering Collateral shall name
the Administrative Agent as loss payee, for the benefit of the Banks, as its
interests may appear and shall provide that such policy will not be canceled or
reduced without thirty (30) days' prior written notice to the Administrative
Agent. Borrower will annually provide the Administrative Agent with all
certificates of insurance evidencing all policies of insurance of Borrower and
its Subsidiaries.
30
Section 8.6 Inspection Rights.
------------------
At any reasonable time and from time to time after reasonable notice to
Borrower, Borrower will permit, and will cause each of its Subsidiaries to
permit, representatives of the Administrative Agent and each Bank to examine,
copy, and make extracts from its books and records, to visit and inspect its
properties, and to discuss its business, operations, and financial condition
with its officers, and independent certified public accountants. Prior to
removing any such copies or extracts from a Company's premises, such Company's
representatives shall be provided a reasonable opportunity to review such
information and ▇▇▇▇ or identify it as "confidential" or "confidential
information" as reasonably deemed appropriate by such Company.
Section 8.7 Keeping Books and Records.
--------------------------
Borrower will maintain, and will cause each of its Subsidiaries to
maintain, proper books of record and account in which full, true, and correct
entries in conformity with GAAP shall be made of all dealings and transactions
in relation to its business and activities.
Section 8.8 Compliance with Laws.
---------------------
Borrower will comply, and will cause each of its Subsidiaries to comply, in
all material respects with all material applicable laws, rules, regulations,
orders, and decrees of any Governmental Authority or arbitrator.
Section 8.9 Compliance with Agreements.
-----------------------------
Borrower will comply, and will cause each of its Subsidiaries to comply, in
all material respects with all agreements, contracts, and instruments binding on
it or affecting its properties or business, except where the failure to do so
would not have a material adverse effect on the business, condition (financial
or otherwise), operations or properties of the Companies taken as a whole,
Borrower, or any Material Subsidiary.
Section 8.10 Further Assurances.
-------------------
Borrower will (a), and will cause each of its Subsidiaries (other than the
Partnerships) to, execute and deliver such further agreements and instruments
and take such further action as may be reasonably requested by the
Administrative Agent to carry out the provisions and purposes of this Agreement
and the other Loan Documents and, (b) and will cause each of its Subsidiaries
(including the Partnerships) to, create, preserve, and perfect the Liens of the
Administrative Agent, for the benefit of the Banks, in the Collateral.
Section 8.11 ERISA.
------
Borrower will comply, and will cause each of its Subsidiaries to comply,
with all minimum funding requirements, and all other material requirements, of
ERISA, if applicable, so as not to give rise to any liability thereunder.
Section 8.12 Information Relating to Proposed Acquisitions.
-----------------------------------------------
Borrower will use its best efforts to keep the Administrative Agent and the
Banks informed of the relevant information and status of and will share with the
Administrative Agent and the Banks and provide copies to the extent possible, of
all material due diligence information relating to any proposed Acquisition with
respect to which Borrower or any Subsidiary enters into a letter of intent or
acquisition agreement, during the term of this Agreement.
Section 8.13 After-Acquired Subsidiaries.
----------------------------
Concurrently upon the formation or Acquisition by Borrower or any
Subsidiary of any Wholly-Owned Subsidiary after the date hereof (pursuant to a
Permitted Acquisition or otherwise) (an "After-Acquired Subsidiary"), Borrower
shall cause the After-Acquired Subsidiary to deliver articles of incorporation,
bylaws, and resolutions (or other corresponding constituent documents) and such
opinions as the Administrative Agent shall require and to execute a Guaranty,
Guarantor Security Agreement, and Pledge Agreement (if applicable), as shall be
required by the Administrative Agent to create first priority Liens in favor of
the Administrative Agent, for the benefit of the Banks, in such After-Acquired
Subsidiary's assets, to secure the Obligations.
Section 8.14 Syndication Cooperation.
------------------------
Borrower acknowledges that the Agents intend promptly to commence to
syndicate the Commitments of the Banks in accordance with the provisions of
Section 13.6. Borrower agrees to actively assist Agents and their Affiliates in
achieving a syndication that is satisfactory to Agents and Borrower and in
preparing information requested by Agents in connection with arranging and
syndication of the Commitments of the Banks and to take such other action deemed
necessary by Agents or their Affiliates, including the holding of a formal
presentation to prospective Banks to achieve a successful syndication of the
Commitments by Agents. The syndication efforts will be accomplished by a variety
of means,
31
including the preparation of a confidential information memorandum and other
marketing materials, direct contact during the syndication between senior
management (including, but not limited to, the chief executive officer, the
chief financial officer and treasurer of Borrower) and advisors and Affiliates
of Borrower and the proposed syndicate Banks.
ARTICLE IX
NEGATIVE COVENANTS
Borrower hereby covenants and agrees that, as long as the Obligations or
any part thereof are outstanding or any Bank has any Commitment hereunder,
Borrower will perform and observe the following negative covenants:
Section 9.1 Debt.
-----
Borrower will not incur, create, assume, or permit to exist, nor permit any
of its Subsidiaries (other than the Partnerships) to incur, create, assume, or
permit to exist, any Debt, except:
(a) Debt owed to the Agents and the Banks pursuant to the Loan Documents;
(b) Existing Debt described on Schedule 7.9 hereto;
(c) Debt owed to Borrower or to any Wholly-Owned Subsidiary;
(d) Debt in an aggregate principal amount not to exceed $250,000.00 at any
time outstanding the proceeds of which are used by the Companies to purchase
equipment, other than lithotripters;
(e) Any Company's obligations as general partner of a Partnership for the
Debt of such Partnership; and
(f) Any Company's Guarantee of Debt of any Partnership, if such Company is
a general partner of such Partnership.
Section 9.2 Limitation on Liens.
--------------------
Borrower will not incur, create, assume, or permit to exist, nor permit any
of its Subsidiaries (other than the Partnerships) to incur, create, assume, or
permit to exist, any Lien upon any of their respective properties, assets, or
revenues, whether now owned or hereafter acquired, except:
(a) Liens disclosed on Schedule 9.2;
(b) Purchase money Liens securing Debt permitted by Section 9.1(d) and (e);
(c) Liens in favor of the Administrative Agent, for the benefit of the
Banks;
(d) Encumbrances consisting of minor easements, zoning restrictions, or
other restrictions on the use of real property that do not (individually or in
the aggregate) materially affect the value of the assets encumbered thereby or
materially impair the ability of Borrower or any of its Subsidiaries to use such
assets in their respective businesses, and none of which is violated in any
material respect by existing or proposed structures or land use;
(e) Liens for taxes, assessments, or other governmental charges which are
not delinquent or which are being contested in good faith and for which adequate
reserves have been established;
(f) Liens of mechanics, materialmen, warehousemen, carriers, or other
similar statutory Liens securing obligations that are not yet due and are
incurred in the ordinary course of business; and
(g) Liens resulting from good faith deposits to secure payments of
workmen's compensation or other social security programs or to secure the
performance of tenders, statutory obligations, surety and appeal bonds, bids,
contracts (other than for payment of Debt), or leases made in the ordinary
course of business.
32
Section 9.3 Mergers, Etc.
--------------
Except upon the prior written consent of the Required Banks, Borrower will
not become a party to a merger or consolidation, except with another Company
where Borrower is the surviving entity. Borrower will not, and will not permit
any of its Subsidiaries (other than the Partnerships) to, wind-up, dissolve or
liquidate itself, unless the assets and stock or other ownership interests of
the Company being wound up, dissolved or liquidated are transferred to another
Company. Except as permitted by Section 9.5, Borrower will not, and will not
permit any of its Subsidiaries (other than the Partnerships) to, make any
Acquisition other than a Permitted Acquisition. Borrower will not, and will not
permit any of its Subsidiaries (other than the Partnerships) to, form,
incorporate, acquire or make any investment in any Subsidiary, except (a) the
Subsidiaries listed on Schedule 7.14.1, (b) Subsidiaries acquired or formed
through a Permitted Acquisition, and (c) Wholly-Owned Subsidiaries formed in
accordance with Section 8.13.
Section 9.4 Restricted Payments.
---------------------
Borrower will not declare or pay any dividends or make any other payment or
distribution (whether in cash, property, or obligations) on account of its
capital stock, or redeem, purchase, retire, or otherwise acquire any of its
capital stock, or permit any of its Subsidiaries to purchase or otherwise
acquire any capital stock of Borrower, or set apart any money for a sinking or
other analogous fund for any dividend or other distribution on its capital stock
or for any redemption, purchase, retirement, or other acquisition of any of its
capital stock; provided, however, that, from the date hereof through and
including the Termination Date, Borrower may redeem or retire and/or the
Companies may purchase shares of Borrower's capital stock for an aggregate
consideration of no more than $750,000.00.
Section 9.5 Investments.
------------
Borrower will not make, nor permit any of its Subsidiaries (other than the
Partnerships) to make, any advance, loan, extension of credit, or capital
contribution to or investment in, or purchase or own, or permit any of its
Subsidiaries (other than the Partnerships) to purchase or own, any stock, bonds,
notes, debentures, or other securities of, any Person, except:
(a) The Companies, or any of them, may purchase (i) readily marketable
direct obligations of the United States of America or any agency thereof with
maturities of one year or less from the date of acquisition, (ii) fully insured
certificates of deposit with maturities of one year or less from the date of
acquisition issued by any commercial bank operating in the United States of
America having capital and surplus in excess of $1,000,000,000, and (iii)
commercial paper of a domestic issuer if at the time of purchase such paper is
rated in one (1) of the two (2) highest rating categories of Standard and Poor's
Rating Group, a division of McGraw Hill, Inc., a New York corporation, or
▇▇▇▇▇'▇ Investors Service, Inc.;
(b) The Companies, or any of them, may make loans to officers, directors
and employees of any of them provided such loans are made in the ordinary course
of business, and are in an aggregate principal amount of not more than
$200,000.00 at any time outstanding;
(c) Borrower may continue to hold capital stock of American Physicians
Service Group, Inc. held by Borrower on the date hereof; and
(d) The Companies may create new Subsidiaries, hold stock in Subsidiaries
and themselves, and engage in the transactions permitted by Section 9.3 hereof,
provided that Borrower complies with Section 8.13.
Section 9.6 Limitation on Issuance of Capital Stock.
----------------------------------------
Borrower will not permit any of its Subsidiaries to at any time issue,
sell, assign, or otherwise dispose of (a) any of its capital stock or other
ownership interests, (b) any securities exchangeable for or convertible into or
carrying any rights to acquire any of its capital stock or other ownership
interests, or (c) any option, warrant, or other right to acquire any of its
capital stock or other ownership interests; provided, however, that any
Subsidiary of Borrower may issue, sell, assign or otherwise dispose of its
capital stock or other ownership interests, or securities exchangeable for its
capital stock or other ownership interests, to Borrower or any other
Wholly-Owned Subsidiary.
Section 9.7 Transactions With Affiliates.
-----------------------------
Borrower will not enter into, and will not permit any of its Subsidiaries
to enter into, any transaction, including, without limitation, the purchase,
sale, or exchange of property or the rendering of any service, with any
Affiliate of Borrower or any Subsidiary of Borrower, except in the ordinary
course of Borrower's or such
33
Subsidiary's business and upon fair and reasonable terms no less favorable to
Borrower or such Subsidiary than would be obtained in a comparable arm's-length
transaction with a Person not an Affiliate of Borrower or such Subsidiary.
Section 9.8 Disposition of Assets.
----------------------
Borrower will not sell, lease, assign, transfer, or otherwise dispose of
any of its assets, nor permit any of its Subsidiaries (other than the
Partnerships) to do so with any of their respective assets, except (subject to
the mandatory prepayments required by Section 3.3) (a) inter-Company transfers
between Borrower and a Wholly-Owned Subsidiary or between Wholly-Owned
Subsidiaries, (b) dispositions of assets, other than lithotripters, in the
ordinary course of business for consideration of up to an aggregate amount of
$250,000.00 during the term of this Agreement, (and the Administrative Agent
agrees to execute and deliver releases of Liens in connection with such
dispositions), (c) dispositions by any Company of assets used in connection with
cardiac rehabilitation or diagnostic imaging, and (d) dispositions of any
tangible assets that are worn or obsolete, provided that such tangible assets
are replaced by assets of similar character where the replacement of such asset
is necessary or appropriate for the continued conduct of such Company's business
as presently conducted.
Section 9.9 Sale and Leaseback.
-------------------
Borrower will not enter into, nor permit any of its Subsidiaries (other
than the Partnerships) to enter into, any arrangement with any Person (other
than another Company) pursuant to which it leases from such Person equipment
used in lithotripsy operations that has been or is to be sold or transferred,
directly or indirectly, by it to such Person; provided, however, that the
Companies may enter into any arrangement with any Person pursuant to which it
leases from such Person real or personal property not used in lithotripsy
operations that has been or is to be sold or transferred, directly or
indirectly, by it to such Person, in an aggregate amount of up to but not to
exceed $250,000.00 during the term of this Agreement.
Section 9.10 Prepayment of Debt.
-------------------
Borrower will not prepay, nor permit any of its Subsidiaries to prepay, any
Debt, except the Obligations, if such prepayment would result in Borrower being
in violation of Article X hereof.
Section 9.11 Nature of Business.
-------------------
Borrower will not, and will not permit any of its Subsidiaries (other than
the Partnerships) to, engage in any business other than the businesses in which
they are engaged on the date hereof; provided, however, that Borrower will not
and will not permit any of its Subsidiaries (other than the Partnerships) not
already in the business of providing non-medical management services to cardiac
rehabilitation or diagnostic imaging operations, to engage in either such
business.
Section 9.12 Environmental Protection.
-------------------------
Borrower will not, and will not permit any of its Subsidiaries to, conduct
any activity or use any of their respective properties or assets in any manner
that could reasonably be expected to violate any Environmental Law or create any
Environmental Liabilities for which Borrower or any of its Subsidiaries would be
responsible.
Section 9.13 Accounting.
-----------
Borrower will not, and will not permit any of its Subsidiaries (other than
the Partnerships) to, change its fiscal year or make any change (a) in
accounting treatment or reporting practices, except as permitted by GAAP and
disclosed to the Administrative Agent, or (b) in tax reporting treatment, except
as permitted by law.
Section 9.14 Amendment of Partnership and Management Agreements.
---------------------------------------------------
Borrower will not, and will not permit any of its Subsidiaries to, amend
any partnership agreements of any of the Partnerships or any management
agreements between any Company and any of the Partnerships, if such amendment
could reasonably be expected to have a material adverse effect on the business,
condition (financial or otherwise), operations, or properties of the Companies
taken as a whole, Borrower, or any Material Subsidiary.
ARTICLE X
FINANCIAL COVENANTS
Borrower hereby covenants and agrees that, as long as the Obligations or
any part thereof are outstanding or any Bank has any Commitment hereunder,
Borrower will perform and observe the following financial covenants:
34
Section 10.1 Total Debt to EBITDA.
---------------------
Borrower will not permit the Total Debt to EBITDA Ratio, determined as of
the last day of each fiscal quarter of the Companies and for the four (4) fiscal
quarter period then ending, to exceed the ratio set forth opposite such period
below:
Period Ratio
------- -----
Date hereof through September 30, 1996 4.00 to 1.0
October 1, 1996 through December 31, 1996 3.25 to 1.0
January 1, 1997 through December 31, 1997 3.00 to 1.0
January 1, 1998 through December 31, 1998 2.50 to 1.0
January 1, 1999 and thereafter 2.00 to 1.0
For purposes of this Section 10.1, cash flows during the relevant period of
any entity acquired by the Companies during such period shall be included in the
calculation of EBITDA.
Section 10.2 Interest Coverage Ratio.
------------------------
Borrower will not permit the Interest Coverage Ratio (a) as of September
30, 1996 for the six (6) month period then ended to be less than 2.75 to 1.0,
(b) as of December 31, 1996 for the nine (9) month period then ended to be less
than 3.25 to 1.0, (c) as of the last day of March 31, 1997, June 30, 1997,
September 30, 1997 and December 31, 1997, in each case for the four (4) fiscal
quarters then ended, to be less than 3.75 to 1.0, (d) as of the last day of
March 31, 1998, June 30, 1998, September 30, 1998 and December 31, 1998, in each
case for the four (4) fiscal quarters then ended, to be less than 4.50 to 1.0,
and (e) as of the last day of each fiscal quarter of Borrower thereafter,
commencing March 31, 1999, to be less than 5.25 to 1.0.
Section 10.3 Total Debt Service Coverage Ratio.
----------------------------------
Borrower will not permit the Total Debt Service Coverage Ratio (a) as of
September 30, 1996 for the six (6) month period then ended to be less than 1.10
to 1.0, (b) as of December 31, 1996 for the nine (9) month period then ended to
be less than 1.20 to 1.0, and (c) as of the last day of each fiscal quarter of
Borrower thereafter, commencing March 31, 1997, to be less than 1.30 to 1.0.
Section 10.4 Consolidated Net Worth.
-----------------------
Borrower shall not permit, as of any date during the following periods, its
Consolidated Net Worth to be less than the amount set forth opposite such period
below, such amount to be (a) increased on the last day of each successive fiscal
quarter of Borrower, beginning June 30, 1996 to and including March 30, 1998, by
an amount equal to one hundred percent (100%) of the increase in net worth
arising from any Acquisition or equity issuance, and (b) increased on the last
day of each successive fiscal quarter of Borrower beginning June 30, 1998, by an
amount equal to seventy-five percent (75%) of Consolidated Net Income for such
fiscal quarter:
Period Amount
------ ------
Date hereof through September 29, 1996 $55,000,000.00
September 30, 1996 through March 30, 1997 $65,000,000.00
March 31, 1997 through September 29, 1997 $70,000,000.00
September 30, 1997 through March 30, 1998 $75,000,000.00
March 31, 1998 and thereafter $75,000,000.00
35
Section 10.5 Minimum EBITDA.
----------------
Borrower will not permit (a) EBITDA for any one (1) fiscal quarter of the
Companies to be less than $5,000,000.00, or (b) EBITDA for any two (2)
consecutive fiscal quarters of the Companies to be less than $12,000,000.00.
ARTICLE XI
DEFAULT
Section 11.1 Events of Default.
------------------
Each of the following shall be deemed an "Event of Default":
(a) Borrower shall fail to pay when due any amount of principal under any
Note.
(b) Borrower shall fail to pay by the Administrative Agent or any Bank
(through the Administrative Agent), any interest on the Advances, any fees due
hereunder or under any other Loan Document, or any other part of the Obligations
which does not constitute principal under the Notes, and such failure shall
continue for three (3) Business Days after such payment became due.
(c) Any representation or warranty made or deemed made by Borrower or any
Obligated Party (or any of their respective officers) in any Loan Document or in
any certificate, report, notice, or financial statement furnished at any time in
connection with this Agreement shall be false, misleading, or erroneous in any
material respect when made or deemed to have been made and the effect thereof
shall not have been cured within ten (10) Business Days after notice thereof to
Borrower by the Administrative Agent or any Bank (through the Administrative
Agent).
(d) Borrower shall fail to perform, observe, or comply with any covenant,
agreement, or term contained in Article X; or Borrower or any Obligated Party
shall fail to perform, observe, or comply with any covenant, agreement or term
contained in Section 8.1 (a), (b), (c) or (d), or Article IX and such failure
shall continue for a period of three (3) Business Days after notice thereof to
Borrower by the Administrative Agent or any Bank (through the Administrative
Agent); or Borrower or any Obligated Party shall fail to perform, observe br
comply with any other covenant, agreement, or term contained in this Agreement
or any other Loan Document (other than covenants to pay the Obligations) and
such failure shall continue for a period of ten (10) Business Days after notice
thereof to Borrower by the Administrative Agent or any Bank (through the
Administrative Agent).
(e) Any Company shall commence a voluntary 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 of it or a 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 generally
fail to pay its debts as they become due or shall take any corporate action to
authorize any of the foregoing.
(f) An involuntary proceeding shall be commenced against any Company
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 for it or a substantial part of its property, and such
involuntary proceeding shall remain undismissed and unstayed for a period of
forty-five (45) days.
(g) Any Company shall fail to discharge within a period of forty-five (45)
days after the commencement thereof any attachment, sequestration, or similar
proceeding or proceedings, including without limitation any order of forfeiture,
seizure or divestiture (whether under RICO or otherwise) involving an aggregate
amount in excess of Two Hundred Fifty Thousand and 00/100 Dollars ($250,000.00)
against any of its assets or properties.
(h) A final judgment or judgments for the payment of money in excess of Two
Hundred Fifty Thousand and 00/100 Dollars ($250,000.00) in the aggregate shall
be rendered by a court or courts against any Company and the same shall not be
discharged (or provision shall not be made for such discharge), or a stay of
execution thereof shall not be procured, within forty
36
-five (45) days from the date of entry thereof and such Company shall not,
within said period of forty-five (45) days, or such longer period during which
execution of the same shall have been stayed, appeal therefrom and cause the
execution thereof to be stayed during such appeal.
(i) Any Company shall fail to pay when due any principal of or interest on
Debt in an aggregate principal amount of Two Hundred Fifty Thousand and 00/100
Dollars ($250,000.00) or more (other than the Obligations), or the maturity of
any such Debt shall have been accelerated, or any such Debt shall have been
required to be prepaid prior to the stated maturity thereof, or any event shall
have occurred that permits (or, with the giving of notice or the lapse of time
or both, would permit) any holder or holders of such Debt or any Person acting
on behalf of such holder or holders to accelerate the maturity thereof or
require any such prepayment.
(j) This Agreement or any other Loan Document shall cease to be in full
force and effect or shall be declared null and void or the validity or
enforceability thereof shall be contested or challenged by Borrower, any
Subsidiary of Borrower, any Obligated Party or any of their respective
shareholders, or Borrower or any Obligated Party shall deny that it has any
further liability or obligation under any of the Loan Documents, or any Lien or
security interest created by the Loan Documents shall for any reason cease to be
a valid, first priority perfected security interest in and Lien upon any of the
Collateral purported to be covered thereby.
(k) Any of the following events shall occur or exist with respect to
Borrower or any ERISA Affiliate: (i) any Prohibited Transaction involving any
Plan; (ii) any Reportable Event with respect to any Plan; (iii) the filing under
Section 4041 of ERISA of a notice of intent to terminate any Plan or the
termination of any Plan; (iv) any event or circumstance that might constitute
grounds entitling the PBGC to institute proceedings under Section 4042 of ERISA
for the termination of, or for the appointment of a trustee to administer, any
Plan, or the institution by the PBGC of any such proceedings; or (v) complete or
partial withdrawal under Section 4201 or 4204 of ERISA from a Multi-employer
Plan or the reorganization, insolvency, or termination of any Multi-employer
Plan; and in each case above, such event or condition, together with all other
events or conditions, if any, have subjected or could in the reasonable opinion
of the Required Banks subject Borrower, or any of its Subsidiaries, to any tax,
penalty, or other liability to a Plan, a Multi-employer Plan, the PBGC, or
otherwise (or any combination thereof) which in the aggregate exceed or could
reasonably be expected to exceed Two Hundred Fifty Thousand and 00/100 Dollars
($250,000.00).
(l) Any Change in Control shall occur.
(m) Borrower shall fail to deliver to the Administrative Agent, for the
benefit of the Banks, interest rate hedging or other protection agreements (a
"Hedging Agreement") with a Bank or other person reasonably acceptable to the
Agents in a notional amount of at least Twenty Million and 00/100 Dollars
($20,000,000.00) for a duration of at least three (3) years, assuring that the
net interest cost on such amount is fixed, capped or hedged, in form and
substance acceptable to the Administrative Agent within ninety (90) days of the
date hereof.
Section 11.2 Remedies.
---------
If any Event of Default shall occur and be continuing, the Administrative
Agent may (and if directed by the Required Banks, shall) do any one or more of
the following:
(a) Acceleration. Declare all outstanding principal of and accrued and
unpaid interest on the Notes and all other obligations of Borrower under the
Loan Documents immediately due and payable, and the same shall thereupon become
immediately due and payable, without notice, demand, presentment, notice of
dishonor, notice of acceleration, notice of intent to accelerate, protest, or
other formalities of any kind, all of which are hereby expressly waived by
Borrower;
(b) Termination of Commitments. Terminate the Commitments without notice to
Borrower;
(c) Judgment. Reduce any claim to judgment;
37
(d) Foreclosure. Foreclose or otherwise enforce any Lien granted to the
Administrative Agent for the benefit of itself and the Banks to secure payment
and performance of the Obligations in accordance with the terms of the Loan
Documents; and
(e) Rights. Exercise any and all rights and remedies afforded by the laws
of the Commonwealth of Massachusetts or any other jurisdiction, by any of the
Loan Documents, by equity, or otherwise;
provided, however, that upon the occurrence of an Event of Default under
Subsection (e) or (f) of Section 11.1, the Commitments of all of the Banks shall
automatically terminate, and the outstanding principal of and accrued and unpaid
interest on the Notes and all other obligations of Borrower under the Loan
Documents shall thereupon become immediately due and payable without notice,
demand, presentment, notice of dishonor, notice of acceleration, notice of
intent to accelerate, protest, or other formalities of any kind, all of which
are hereby expressly waived by Borrower.
Section 11.3 Performance by the Administrative Agent.
----------------------------------------
If Borrower shall fail to perform any covenant or agreement in accordance
with the terms of the Loan Documents, the Administrative Agent may, at the
direction of the Required Banks, perform or attempt to perform such covenant or
agreement on behalf of Borrower. In such event, Borrower shall, at the request
of the Administrative Agent, promptly pay any amount expended by the
Administrative Agent or the Banks in connection with such performance or
attempted performance to the Administrative Agent at the Principal Office,
together with interest thereon at the Default Rate from and including the date
of such expenditure to but excluding the date such expenditure is paid in full.
Notwithstanding the foregoing, it is expressly agreed that neither the
Administrative Agent nor any Bank shall have any liability or responsibility for
the performance of any obligation of Borrower under this Agreement or any of the
other Loan Documents.
ARTICLE XII
THE ADMINISTRATIVE AGENT
Section 12.1 Appointment, Powers and Immunities.
-----------------------------------
In order to expedite the various transactions contemplated by this
agreement, the Banks hereby irrevocably appoint and authorize FNBB to act as
their Administrative Agent hereunder and under each of the other Loan Documents.
FNBB consents to such appointment and agrees to perform the duties of the
Administrative Agent as specified herein. The Banks authorize and direct the
Administrative Agent to take such action in their name and on their behalf under
the terms and provisions of the Loan Documents and to exercise such rights and
powers thereunder as are specifically delegated to or required of the
Administrative Agent for the Banks, together with such rights and powers as are
reasonably incidental thereto. The Administrative Agent is hereby expressly
authorized to act as the Administrative Agent on behalf of itself and the other
Banks:
(a) To receive on behalf of each of the Banks any payment of principal,
interest, fees or other amounts paid pursuant to this Agreement and the Notes
and to distribute to each Bank its pro rata share of all payments so received as
provided in this Agreement;
(b) To receive all documents and items to be furnished under the Loan
Documents;
(c) To act as nominee for and on behalf of the Banks in and under the Loan
Documents;
(d) To arrange for the means whereby the funds of the Banks are to be made
available to Borrower;
(e) To distribute to the Banks information, requests, notices, payments,
prepayments, documents and other items received from Borrower, the other
Obligated Parties, and other Persons;
(f) To execute and deliver to Borrower, the other Obligated Parties, and
other Persons, all requests, demands, approvals, notices, and consents received
from the Banks;
38
(g) To the extent permitted by the Loan Documents, to exercise on behalf of
each Bank all rights and remedies of the Banks upon the occurrence of any Event
of Default;
(h) To accept, execute, and deliver the Security Agreement and any other
security documents as the secured party; and
(i) To take such other actions as may be requested by the Required Banks.
Neither the Administrative Agent nor any of its Affiliates, officers,
directors, employees, attorneys, or agents shall be liable to any Bank for any
action taken or omitted to be taken by any of them hereunder or otherwise in
connection with this Agreement or any of the other Loan Documents (INCLUDING ANY
ACTION TAKEN OR OMITTED TO BE TAKEN BY SUCH PARTIES NEGLIGENTLY), but excluding
such actions or omissions arising from such parties' own gross negligence or
willful misconduct. Without limiting the generality of the preceding sentence,
the Administrative Agent: (i) may treat the payee of any Note as the holder
thereof until the Administrative Agent receives written notice of the assignment
or transfer thereof signed by such payee and in form satisfactory to the
Administrative Agent; (ii) shall have no duties or responsibilities except those
expressly set forth in this Agreement and the other Loan Documents, and shall
not by reason of this Agreement or any other Loan Document be a trustee or
fiduciary for any Bank; (iii) shall not be required to initiate any litigation
or collection proceedings hereunder or under any other Loan Document except to
the extent requested by the Required Banks; (iv) shall not be responsible to the
Banks for any recitals, statements, representations or warranties contained in
this Agreement or any other Loan Document, or any certificate or other document
referred to or provided for in, or received by any of them under, this Agreement
or any other Loan Document, or for the value, validity, effectiveness,
enforceability, or sufficiency of this Agreement or any other Loan Document or
any other document referred to or provided for herein or therein or for any
failure by any Person to perform any of its obligations hereunder or thereunder;
(v) may consult with legal counsel (including counsel for Borrower), independent
public accountants, and other experts selected by it and shall not be liable for
any action taken or omitted to be taken in good faith by it in accordance with
the advice of such counsel, accountants, or experts; and (vi) shall incur no
liability under or in respect of any Loan Document by acting upon any notice,
consent, certificate, or other instrument or writing believed by it to be
genuine and signed or sent by the proper party or parties. As to any matters not
expressly provided for by this Agreement, the Administrative Agent shall in all
cases be fully protected in acting, or in refraining from acting, here under in
accordance with instructions signed by the Required Banks, and such instructions
of the Required Banks and any action taken or failure to act pursuant thereto
shall be binding on all of the Banks; provided, however, that the Administrative
Agent shall not be required to take any action which exposes the Administrative
Agent to personal liability or which is contrary to this Agreement or any other
Loan Document or applicable law.
Section 12.2 Rights of Administrative Agent as a Bank.
-----------------------------------------
With respect to its Commitment, the Advances made by it and the Note issued
to it, FNBB 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 the Administrative Agent, and the term "Bank" or "Banks" shall,
unless the context otherwise indicates, include the Administrative Agent in its
individual capacity. The Administrative Agent and its Affiliates may (without
having to account therefor to any Bank) accept deposits from, lend money to, act
as trustee under indentures of, provide merchant banking services to, and
generally engage in any kind of business with Borrower, any Subsidiary of
Borrower, any other Obligated Party, and any other Person who may do business
with or own securities of Borrower or any other Obligated Party, all as if it
were not acting as the Administrative Agent and without any duty to account
therefor to the Banks.
Section 12.3 Sharing of Payments, Etc.
-------------------------
If any Bank shall obtain any payment of any principal of or interest on any
Advance made by it under this Agreement or payment of any other obligation under
the Loan Documents then owed by Borrower or any other Obligated Party to such
Bank, whether voluntary, involuntary, through the exercise of any right of
setoff, banker's lien, counterclaim or similar right, or otherwise, in excess of
its pro rata share, such Bank shall promptly purchase from the other Banks
participations in the Advances held by them hereunder in such amounts, and make
such other adjustments from time to time as shall be necessary to cause such
purchasing Bank to share the excess payment ratably with each of the other Banks
in accordance with its pro rata portion thereof. To such end, all of the Banks
shall make appropriate adjustments among themselves (by the resale of
participations sold or otherwise) if all or any portion of such excess payment
is thereafter rescinded or must
39
otherwise be restored. Borrower agrees, to the fullest extent it may effectively
do so under applicable law, that any Bank so purchasing a participation in the
Advances made by the other Banks may exercise all rights of setoff, banker's
lien, counterclaim, or similar rights with respect to such participation as
fully as if such Bank were a direct holder of Advances to Borrower 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 Borrower.
Section 12.4 Indemnification.
----------------
THE BANKS HEREBY AGREE TO INDEMNIFY THE ADMINISTRATIVE AGENT FROM AND HOLD
THE ADMINISTRATIVE AGENT HARMLESS AGAINST (TO THE EXTENT NOT REIMBURSED UNDER
SECTIONS 13.1 AND 13.2, BUT WITHOUT LIMITING THE OBLIGATIONS OF BORROWER UNDER
SECTIONS 13.1 AND 13.2), RATABLY IN ACCORDANCE WITH THEIR RESPECTIVE
COMMITMENTS, ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES,
ACTIONS, JUDGMENTS, DEFICIENCIES, SUITS, COSTS, EXPENSES (INCLUDING ATTORNEYS'
FEES), AND DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED
ON, INCURRED BY, OR ASSERTED AGAINST THE ADMINISTRATIVE AGENT IN ANY WAY
RELATING TO OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY ACTION TAKEN OR
OMITTED TO BE TAKEN BY THE ADMINISTRATIVE AGENT UNDER OR IN RESPECT OF ANY OF
THE LOAN DOCUMENTS INCLUDING ANY PORTION OF THE FOREGOING TO THE EXTENT CAUSED
BY THE ADMINISTRATIVE AGENT'S SOLE OR CONTRIBUTORY NEGLIGENCE; PROVIDED,
FURTHER, THAT NO BANK SHALL BE LIABLE FOR ANY PORTION OF THE FOREGOING TO THE
EXTENT CAUSED BY THE ADMINISTRATIVE AGENT'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. WITHOUT LIMITATION OF THE FOREGOING, IT IS THE EXPRESS INTENTION OF
THE BANKS THAT THE ADMINISTRATIVE AGENT SHALL BE INDEMNIFIED HEREUNDER FROM AND
HELD HARMLESS AGAINST ALL OF SUCH LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, DEFICIENCIES, SUITS, COSTS, EXPENSES (INCLUDING
ATTORNEYS' FEES), AND DISBURSEMENTS OF ANY KIND OR NATURE DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RESULTING FROM THE SOLE OR CONTRIBUTORY NEGLIGENCE OF THE
ADMINISTRATIVE AGENT. WITHOUT LIMITING ANY OTHER PROVISION OF THIS SECTION, EACH
BANK AGREES TO REIMBURSE THE ADMINISTRATIVE AGENT PROMPTLY UPON DEMAND FOR ITS
PRO RATA SHARE (CALCULATED ON THE BASIS OF THE COMMITMENTS) OF ANY AND ALL
OUT-OF-POCKET EXPENSES (INCLUDING ATTORNEYS' FEES) INCURRED BY THE
ADMINISTRATIVE AGENT IN CONNECTION WITH THE PREPARATION, EXECUTION, DELIVERY,
ADMINISTRATION, MODIFICATION, AMENDMENT OR ENFORCEMENT (WHETHER THROUGH
NEGOTIATIONS, LEGAL PROCEEDINGS, OR OTHERWISE) OF, OR LEGAL ADVICE IN RESPECT OF
RIGHTS OR RESPONSIBILITIES UNDER, THE LOAN DOCUMENTS, TO THE EXTENT THAT THE
ADMINISTRATIVE AGENT IS NOT REIMBURSED FOR SUCH EXPENSES BY BORROWER.
Section 12.5 Independent Credit Decisions.
-----------------------------
Each Bank agrees that it has independently and without reliance on any
Agent or any other Bank, and based on such documents and information as it has
deemed appropriate, made its own credit analysis of Borrower and decision to
enter into this Agreement and that it will, independently and without reliance
upon any Agent or any other Bank, and based upon 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 any of the
other Loan Documents. The Administrative Agent shall not be required to keep
itself informed as to the performance or observance by Borrower or any Obligated
Party of this Agreement or any other Loan Document or to inspect the properties
or books of Borrower or any Obligated Party. Except for notices, reports and
other documents and information expressly required to be furnished to the Banks
by the Administrative Agent hereunder or under the other Loan Documents, the
Administrative Agent shall not have any duty or responsibility to provide any
Bank with any credit or other financial information concerning the affairs,
financial condition or business of Borrower or any Obligated Party (or any of
their Affiliates) which may come into the possession of the Administrative Agent
or any of its Affiliates.
Section 12.6 Several Commitments.
--------------------
The Commitments and other obligations of the Banks under this Agreement are
several. The default by any Bank in making an Advance in accordance with its
Commitment shall not relieve the other Banks
40
of their obligations under this Agreement. In the event of any default by any
Bank in making any Advance, each nondefaulting Bank shall be obligated to make
its Advance but shall not be obligated to advance the amount which the
defaulting Bank was required to advance hereunder. In no event shall any Bank be
required to advance an amount or amounts which shall in the aggregate exceed
such Bank's Commitment. No Bank shall be responsible for any act or omission of
any other Bank.
Section 12.7 Successor Administrative Agent.
-------------------------------
Subject to the appointment and acceptance of a successor Administrative
Agent as provided below, the Administrative Agent may resign at any time by
giving notice thereof to the Banks and Borrower and the Administrative Agent may
be removed at any time with or without cause by the Required Banks. Upon any
such resignation or removal, the Required Banks will have the right to appoint a
successor Administrative Agent from among the remaining Banks. If no successor
Administrative Agent shall have been so appointed by the Required Banks and
shall have accepted such appointment within thirty (30) days after the retiring
Administrative Agent's giving of notice of resignation or the Required Banks'
removal of the retiring Administrative Agent, then the retiring Administrative
Agent may, on behalf of the Banks, appoint a successor Administrative Agent,
which shall be a commercial bank organized under the laws of the United States
of America or any State thereof and having combined capital and surplus of at
least One Billion Dollars ($1,000,000,000). Upon the acceptance of its
appointment as successor Administrative Agent, such successor Administrative
Agent shall thereupon succeed to and become vested with all rights, powers,
privileges, immunities, and duties of the resigning or removed Administrative
Agent, and the resigning or removed Administrative Agent shall be discharged
from its duties and obligations under this Agreement and the other Loan
Documents. After any Administrative Agent's resignation or removal as
Administrative Agent, the provisions of this Article XII shall continue in
effect for its benefit in respect of any actions taken or omitted to be taken by
it while it was the Administrative Agent.
Section 12.8 Independent Contractor.
-----------------------
(a) The relationship between each Agent and each of the Banks is that of an
independent contractor. The use of the term "Agent" is for convenience only and
is used to describe, as a form of convention, the independent contractual
relationship between each Agent and each of the Banks. Nothing contained in this
Agreement or the other Loan Documents shall be construed to create an agency,
trust or other fiduciary relationship between any Agent and any of the Banks.
(b) As an independent contractor empowered by the Banks to exercise certain
rights and perform certain duties and responsibilities hereunder and under the
other Loan Documents, the Administrative Agent is nevertheless a
"representative" of the Banks, as that term is defined in Article 1 of the
Uniform Commercial Code, for purposes of actions for the benefit of the Banks
and the Administrative Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents. Such actions include the
designation of the Administration Agent as "secured party," "mortgagee" or the
like on all financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority or
enforcement of any security interests, mortgages or deeds of trust in collateral
security intended to secure the payment or performance of any of the
Obligations, all for the benefit of the Banks and the Administrative Agent.
ARTICLE XIII
MISCELLANEOUS
Section 13.1 Expenses.
---------
Borrower hereby agrees to pay on demand: (a) all reasonable costs and
expenses of the Agents in connection with the preparation, negotiation,
syndication, execution, and delivery of this Agreement and the other Loan
Documents including, without limitation, the legal fees and reasonable expenses
of legal counsel for the Agents; (b) all reasonable costs and expenses of the
Agents in connection with any and all amendments, modifications, renewals,
extensions and supplements of any of the Loan Documents; (c) all reasonable
costs and expenses of the Agents and the Banks in connection with any Default
and the enforcement of this Agreement or any other Loan Document, including,
without limitation, the fees and expenses of legal counsel for the Agents and
the Banks; (d) all transfer, stamp, documentary, or other similar taxes,
assessments, or charges levied by any Governmental Authority in respect of this
Agreement or any of the other Loan Documents; (e) all costs, expenses,
assessments, and other charges incurred in connection with any filing,
registration, recording, or perfection of any security interest or Lien
contemplated by this Agreement or any other Loan Document; and (f) all other
41
reasonable costs and expenses incurred by the Agents in connection with this
Agreement or any other Loan Document, including, without limitation, all costs,
expenses, and other charges incurred in connection with obtaining any mortgagee
title insurance policy, survey, audit, appraisal in respect of the Collateral,
and other out-of-pocket costs and expenses.
SECTION 13.2 INDEMNIFICATION.
----------------
BORROWER SHALL INDEMNIFY THE AGENTS AND EACH BANK AND EACH AFFILIATE
THEREOF AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, ATTORNEYS, AND
AGENTS FROM, AND HOLD EACH OF THEM HARMLESS AGAINST, ANY AND ALL LOSSES,
LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS, DISBURSEMENTS, COSTS, AND
EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES) TO WHICH ANY OF THEM MAY BECOME
SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO (A) THE
NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR ENFORCEMENT OF
ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS CONTEMPLATED BY THE LOAN
DOCUMENTS, (C) ANY BREACH BY BORROWER OF ANY REPRESENTATION, WARRANTY, COVENANT,
OR OTHER AGREEMENT CONTAINED IN ANY OF THE LOAN DOCUMENTS, (D) THE PRESENCE,
RELEASE, THREATENED RELEASE, DISPOSAL, REMOVAL, OR CLEANUP OF ANY HAZARDOUS
MATERIAL LOCATED ON, ABOUT, WITHIN, OR AFFECTING ANY OF THE PROPERTIES OR ASSETS
OF BORROWER OR ANY SUBSIDIARY OF BORROWER, OR (E) ANY INVESTIGATION, LITIGATION,
OR OTHER PROCEEDING, INCLUDING, WITHOUT LIMITATION, ANY THREATENED
INVESTIGATION, LITIGATION, OR OTHER PROCEEDING RELATING TO ANY OF THE FOREGOING.
WITHOUT LIMITING THE FOREGOING, THIS INDEMNITY SHALL APPLY TO ANY LOSS,
LIABILITY, OBLIGATION, DAMAGE, PENALTY, JUDGMENT, CLAIM, DEFICIENCY OR EXPENSE
ARISING OUT OF THE SOLE OR CONCURRENT NEGLIGENCE OF ANY AGENT OR ANY BANK, BUT
SHALL EXCLUDE ANY LOSS, LIABILITY, OBLIGATION, DAMAGE, PENALTY, JUDGMENT, CLAIM,
DEFICIENCY OR EXPENSE ARISING BY REASON OF THE GROSS NEGLIGENCE OR WILFUL
MISCONDUCT OF ANY AGENT OR BANK.
Section 13.3 No Duty.
--------
All attorneys, accountants, appraisers, and other professional Persons and
consultants retained by the Agents and the Banks shall have the right to act
exclusively in the interest of the Agents and the Banks and shall have no duty
of disclosure, duty of loyalty, duty of care, or other duty or obligation of any
type or nature whatsoever to Borrower, any shareholder or Subsidiary of Borrower
or any other Person.
Section 13.4 No Fiduciary Relationship.
--------------------------
The relationship between Borrower and each Bank is solely that of debtor
and creditor, and none of the Agents nor any of the Banks has any fiduciary or
other special relationship with Borrower, and no term or condition of any of the
Loan Documents shall be construed so as to deem the relationship between
Borrower and any Bank to be other than that of debtor and creditor.
Section 13.5 No Waiver; Cumulative Remedies.
-------------------------------
No failure on the part of the Agents or any Bank to exercise and no delay
in exercising, and no course of dealing with respect to, any right, power, or
privilege under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any right, power, or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any
other right, power, or privilege. The rights and remedies provided for in this
Agreement and the other Loan Documents are cumulative and not exclusive of any
rights and remedies provided by law.
Section 13.6 Successors and Assigns.
-----------------------
(a) This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns. Borrower may not
assign or transfer any of its rights or obligations hereunder without the prior
written consent of the Administrative Agent and all of the Banks. Any Bank may
sell participations to one or more banks or other institutions in or to all or a
portion of its rights and obligations under this Agreement and the other Loan
Documents (including, without limitation, all or a portion of its Commitments
and the Advances owing to it); provided, however, that (i) such Bank's
obligations under this Agreement and the other Loan Documents (including,
without limitation, its Commitments) shall remain unchanged, (ii) such Bank
shall remain solely responsible to Borrower for the performance of such
obligations, (iii) such Bank shall remain the holder of its Notes for all
purposes of this Agreement, (iv) Borrower shall continue to deal solely and
directly with such Bank in connection with such Bank's rights and obligations
under this Agreement and the other Loan Documents, and
42
(v) such Bank shall not sell a participation that conveys to the participant the
right to vote or give or withhold consents under this Agreement or any other
Loan Document, other than the right to vote upon or consent to (A) any increase
of such Bank's Commitments, (B) any reduction of the principal amount of, or
interest to be paid on, the Advances of such Bank, (C) any reduction of any
commitment fee or other amount payable to such Bank under any Loan Document, or
(D) any postponement of any date for the payment of any amount payable in
respect of the Advances of such Bank.
(b) Borrower and each of the Banks agree that any Bank (an "Assigning
Bank") may at any time assign to one or more Eligible Assignees all, or a
portion of all, of its rights and obligations under this Agreement and the other
Loan Documents (including, without limitation, its Commitment and Advances)
(each an "Assignee"); provided, however, that (i) except in the case of an
assignment of all of a Bank's rights and obligations under this Agreement and
the other Loan Documents, the amount of the Commitments of the assigning Bank
being assigned pursuant to each assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall in no event be
less than $5,000,000.00, and (ii) the parties to each such assignment shall
execute and deliver to the Administrative Agent for its acceptance and recording
in the Register (as defined below), an Assignment and Acceptance, together with
the Note subject to such assignment, and a processing and recordation fee of
$3,000.00. Upon such execution, delivery, acceptance, and recording, 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, or, if so specified in such Assignment and Acceptance, the date of
acceptance thereof by the Administrative Agent, (x) the assignee thereunder
shall be a party hereto as a "Bank" and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment and
Acceptance, have the rights and obligations of a Bank hereunder and under the
Loan Documents and (y) the Bank that is an assignor thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released from
its obligations under this Agreement and the other Loan Documents (and, in the
case of an Assignment and Acceptance covering all or the remaining portion of a
Bank's rights and obligations under the Loan Documents, such Bank shall cease to
be a party thereto).
(c) By executing and delivering an Assignment and Acceptance, the Assigning
Bank and its Assignee confirm to and agree with each other and the other parties
hereto as follows: (i) other than as provided in such Assignment and Acceptance,
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 the Loan Documents or the execution, legality,
validity, and enforceability, genuineness, sufficiency, or. value of the Loan
Documents or any other instrument or document furnished pursuant thereto; (ii)
such Assigning Bank makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or any
Obligated Party or the performance or observance by Borrower or any Obligated
Party of its obligations under the Loan Documents; (iii) the Assignee confirms
that it has received copies of the Loan Documents, together with copies of the
financial statements referred to in Section 7.2 and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into such Assignment and Acceptance; (iv) the Assignee will,
independently and without reliance upon the Administrative Agent or such
assignor and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement and the other Loan Documents; (v) the
Assignee confirms that it is an Eligible Assignee; (vi) the Assignee appoints
and authorizes the Administrative Agent to take such action as Administrative
Agent on its behalf and exercise such powers under the Loan Documents as are
delegated to the Administrative Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; and (vii) the Assignee agrees that
it will perform in accordance with their terms all of the obligations which by
the terms of the Loan Documents are required to be performed by it as a Bank.
(d) The Administrative Agent shall maintain at its Principal Office a copy
of each Assignment and Acceptance delivered to and accepted by it and a register
for the recordation of the names and addresses of the Banks and the Commitment
of, and principal amount of the Advances owing to, each Bank from time to time
(the "Register"). The entries in the Register shall be conclusive and binding
for all purposes, absent manifest error, and Borrower, the Administrative Agent,
and the Banks may treat each Person whose name is recorded in the Register as a
Bank hereunder for all purposes under the Loan Documents. The Register shall be
available for inspection by Borrower or any Bank at any reasonable time and from
time to time upon reasonable prior notice.
43
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Bank and Assignee representing that it is an Eligible Assignee (or
other assignee permitted hereunder), together with any Note subject to such
assignment, the Administrative Agent shall, if such Assignment and Acceptance
has been completed and is in substantially the form of Exhibit A, (i) accept
such Assignment and Acceptance, (ii) record the information contained therein in
the Register, and (iii) give prompt written notice thereof to Borrower. Within
five (5) Business Days after its receipt of such notice, Borrower, at its
expense, shall execute and deliver to the Administrative Agent in exchange for
the surrendered Note a new Note to the order of such Eligible Assignee (or other
assignee permitted hereunder) in an amount equal to the portion of the
Commitments assumed by it pursuant to such Assignment and Acceptance and, if the
Assigning Bank has retained a portion of the Commitments, a new Note to the
order of the Assigning Bank in an amount equal to the portion of the Commitments
retained by it hereunder (each such promissory note shall constitute a "Note"
for purposes of the Loan Documents). Such new Notes shall be in an aggregate
principal amount of the surrendered Note, shall be dated the effective date of
such Assignment and Acceptance, and shall otherwise be in substantially the form
of Exhibit B and Exhibit C.
(f) Any Bank 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 Borrower or any Subsidiary of Borrower furnished to such, Bank by or
on behalf of Borrower or any of its Subsidiaries.
(g) Notwithstanding any other term of this Agreement to the contrary, any
Bank may (without requesting the consent of either the Administrative Agent or
Borrower) pledge its Notes to a Federal Reserve Bank in support of borrowings
made by such Bank from such Federal Reserve Bank.
(h) Notwithstanding any other term of this Agreement to the contrary, any
Bank may assign all, or a portion of all, of its rights and obligations under
this Agreement and the other Loan Documents (including, without limitation, its
Commitment and Advances) to an Affiliate of such Bank or any other Bank,
provided that:
(i) such assignor Bank has obtained the written consent of the
Administrative Agent (which consent shall not be unreasonably delayed or
withheld) if the effect of such assignment or delegation shall entitle such
Affiliate or other Bank to claim compensation from Borrower pursuant to Article
IV; and
(ii) in every other case, such assignor Bank has furnished notice to, but
not obtained the consent of, the Administrative Agent.
Section 13.7 Survival.
---------
All representations and warranties made in this Agreement or any other Loan
Document or in any document, statement, or certificate furnished in connection
with this Agreement shall survive the execution and delivery of this Agreement
and the other Loan Documents until the Obligations have been paid and performed
in full, and no investigation by the Administrative Agent or any Bank or any
closing shall affect the representations and warranties or the right of the
Administrative Agent or any Bank to rely upon them. Without prejudice to the
survival of any other obligation of Borrower hereunder, the obligations of
Borrower under Article IV and Sections 13.1 and 13.2 shall survive repayment of
the Notes and termination of the Commitments. The obligations of the
Administrative Agent and the Banks under Section 13.18 shall survive repayment
of the Notes and termination of the Commitments.
Section 13.8 ENTIRE AGREEMENT.
------------------
THIS AGREEMENT, THE NOTES, AND THE OTHER LOAN DOCUMENTS REFERRED TO HEREIN
EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDE ANY
AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS,
WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF AND MAY NOT BE
CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS
AMONG THE PARTIES HERETO.
Section 13.9 Amendments, Etc.
----------------
No amendment or waiver of any provision of this Agreement, the Notes, or
any other Loan Document to which Borrower is a party, nor any consent to any
departure by Borrower therefrom, shall in any event
44
be effective unless the same shall be agreed or consented to by the Required
Banks and Borrower, and each such waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given; provided,
that no amendment, waiver, or consent shall, unless in writing and signed by all
of the Banks and Borrower, do any of the following: (a) increase Commitments of
the Banks or subject the Banks to any additional obligations; (b) reduce the
principal of, or interest on, the Notes or any fees or other amounts payable to
the Banks (but not the Administrative Agent) hereunder; (c) postpone any date
fixed for any payment of principal of, or interest on, the Notes or any fees or
other amounts payable to the Administrative Agent or the Banks hereunder; (d)
change the percentage of the Commitments or of the aggregate unpaid principal
amount of the Notes or the number of Banks which shall be required for the Banks
or any of them to take any action under this Agreement; (e) change any provision
contained in this Section 13.9; or (f) release any material portion of the
Collateral, except in accordance with the relevant Loan Document.
Notwithstanding anything to the contrary contained in this Section, no
amendment, waiver, or consent shall be made with respect to Article XII without
the prior written consent of the Administrative Agent.
Section 13.10 Maximum Interest Rate.
----------------------
No provision of this Agreement or of any other Loan Document shall require
the payment or the collection of interest in excess of the maximum amount
permitted by applicable law. If any excess of interest in such respect is hereby
provided for, or shall be adjudicated to be so provided, in any Loan Document or
otherwise in connection with this loan transaction, the provisions of this
Section shall govern and prevail and neither Borrower nor the sureties,
guarantors, successors, or assigns of Borrower shall be obligated to pay the
excess amount of such interest or any other excess sum paid for the use,
forbearance, or detention of sums loaned pursuant hereto. In the event any Bank
ever receives, collects, or applies as interest any such sum, such amount which
would be in excess of the maximum amount permitted by applicable law shall be
applied as a payment and reduction of the principal of the indebtedness
evidenced by the Notes; and, if the principal of the Notes has been paid in
full, any remaining excess shall forthwith be paid to Borrower. In determining
whether or not the interest paid or payable exceeds the Maximum Rate, Borrower
and each Bank shall, to the extent permitted by applicable law, (a) characterize
any non-principal payment as an expense, fee, or premium rather than as
interest, (b) exclude voluntary prepayments and the effects thereof, and (c)
amortize, prorate, allocate, and spread in equal or unequal parts the total
amount of interest throughout the entire contemplated term of the indebtedness
evidenced by the Notes so that interest for the entire term does not exceed the
Maximum Rate.
Section 13.11 Notices.
--------
All notices and other communications provided for in this Agreement and the
other Loan Documents to which Borrower is a party shall be given or made by
telecopy or in writing and telecopied, mailed by certified mail return receipt
requested, or delivered to the intended recipient at the "Address for Notices"
specified below its name on the signature pages hereof-, or, as to any party at
such other address as shall be designated by such party in a notice to each
other party given in accordance with this Section. Except as otherwise provided
in this Agreement, all such communications shall be deemed to have been duly
given when transmitted by telecopy, subject to telephone confirmation of
receipt, or when personally delivered or, in the case of a mailed notice, when
duly deposited in the mails, in each case given or addressed as aforesaid;
provided, however, notices to the Administrative Agent pursuant to Article II
shall not be effective until received by the Administrative Agent.
Section 13.12 Governing Law.
---------------
This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts and the applicable laws of the United
States of America.
Section 13.13 Counterparts.
-------------
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same instrument.
Section 13.14 Severability.
-------------
Any provision of this Agreement held by a court of competent jurisdiction
to be invalid or unenforceable shall not impair or invalidate the remainder of
this Agreement and the effect thereof shall be confined to the provision held to
be invalid or illegal.
Section 13.15 Headings.
---------
The headings, captions, and arrangements used in this Agreement are for
convenience only and shall not affect the interpretation of this Agreement.
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Section 13.16 Construction.
-------------
Borrower, the Administrative Agent, and each Bank acknowledges that each of
them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement and the other Loan Documents
with its legal counsel.
Section 13.17 Independence of Covenants.
--------------------------
All covenants hereunder shall be given independent effect so that if a
particular action or condition is not permitted by any of such covenants, the
fact that it would be permitted by an exception to, or be otherwise within the
limitations of, another covenant shall not avoid the occurrence of a Default if
such action is taken or such condition exists.
Section 13.18 Confidentiality.
----------------
(a) The Agents and the Banks shall treat the Confidential Information in
confidence and undertake the following obligations with respect thereto:
(i) The Agents and each Bank and each Other Recipient (hereinafter defined)
shall not make use of, disseminate, or in any way disclose, directly or
indirectly, to any other Person other than the senior executives, employees,
attorneys, accountants and examiners of the Agents and each Bank, who reasonably
require access to the Confidential Information for the proper performance of
their assigned duties, and any contemplated assignee of all or a portion of a
Bank's rights and obligations under this Agreement (collectively, the "Other
Recipients") any Confidential Information without receiving prior written
permission from Borrower. Each Other Recipient will be informed of the terms and
provisions of this Section 13.18, and the Banks shall be liable for any breach
of any term or provision of this Section 13.18 by any Other Recipient as if such
person was a signatory hereto, unless such Other Recipient has entered into a
confidentiality agreement directly with Borrower; and
(ii) The Agents and each Bank and each Other Recipient shall use the
Confidential Information solely in connection with the Loan Documents or in
connection with the ordinary course of business of the Agents or the Banks
(except if such ordinary course of business activities are adverse to the
Companies' interests) and shall not use any of such Confidential Information for
any other purpose or aid any Person (other than the Agents, any Bank or any
Other Recipient) in learning of or using it or permit others to learn of or use
it.
(b) In the event that any Agent, any Bank or any Other Recipient becomes
legally compelled to disclose any of the Confidential Information, it shall
provide Borrower with notice promptly after receiving notice of any proceeding
relating to such disclosure so that the Companies may seek a protective order or
other appropriate remedy. In the event that such protective order or other
remedy is not obtained on or before the date that disclosure must be made, such
Agent, such Bank or the Other Recipient, as the case may be, will furnish only
that portion of the Confidential Information which it is legally required to
disclose.
(c) The Agents and the Banks are aware, and agree to inform all Other
Recipients, that the United States securities laws prohibit any Person who has
received material, non-public information such as is the subject of this Section
13.18 from an issuer from purchasing or selling the securities of such issuer or
from communicating such information to any other Person under circumstances in
which it is reasonably foreseeable that such Person is likely to purchase or
sell such securities.
(d) The Companies and the Agents and the Banks agree that monetary damages
would not be a sufficient remedy for any breach of this Section 13.18 by the
Agents, the Banks or any Other Recipient and that, in addition to all other
remedies, the Companies shall be entitled to specific performance and injunction
or other equitable relief as a remedy for any such breach.
(e) The restrictions and obligations of this Section 13.18 shall survive
the repayment of the Obligations and shall continue to bind the Agents, the
Banks and the Other Recipients.
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Section 13.19 Renewal and Increase.
-----------------------
The Revolving Credit Loan is in renewal, extension, modification and
amendment of the Original Credit Agreement and the loan documents executed in
connection therewith, and all liens and security interests securing payment
thereof.
Section 13.20 WAIVER OF JURY TRIAL.
---------------------
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, BORROWER HEREBY
IRREVOCABLY AND EXPRESSLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING, OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE)
ARISING OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED THEREBY OR THE ACTIONS OF ANY AGENT OR ANY BANK IN THE NEGOTIATION,
ADMINISTRATION, OR ENFORCEMENT THEREOF.
Section 13.21 CHOICE OF FORUM; CONSENT TO SERVICE OF PROCESS AND
JURISDICTION.
---------------------------------------------------
Any suit, action or proceeding against Borrower with respect to this
Agreement or the Loan Documents, or any judgment entered by any court in respect
thereof, may be brought in the courts of the Commonwealth of Massachusetts,
County of Suffolk, or in the United States courts located in the Commonwealth of
Massachusetts as the Administrative Agent shall, at the direction of the
Required Banks elect in their sole discretion, and Borrower irrevocably submits
to the non-exclusive jurisdiction of such courts for the purpose of any suit,
action or proceeding. Borrower irrevocably consents to the service of process in
any suit, action or proceeding in said court by the mailing thereof by the
Administrative Agent by registered or certified mail, postage prepaid to
Borrower's address shown opposite its name on the signature pages hereof.
Nothing herein or in any of the other Loan Documents shall affect the right of
the Administrative Agent to serve process in any other manner permitted by law
or shall limit the right of the Administrative Agent to bring any action or
proceeding against Borrower or with respect to any of its property in courts in
other jurisdictions. Borrower irrevocably waives any objections which it may now
or hereafter have to laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement or the other Loan Documents brought in the
courts located in the Commonwealth of Massachusetts, County of Suffolk, and
hereby further irrevocably waives any claim that any such suit, action or
proceeding brought in any such court has been brought in any inconvenient forum.
Any action or proceeding by Borrower against the Administrative Agent or any
Bank shall be brought only in a court located in Suffolk County, Massachusetts.
[Balance of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first above written.
BORROWER:
PRIME MEDICAL SERVICES, INC.
By:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Vice President - Finance
Address for Notices:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇-▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
48
FNBB:
THE FIRST NATIONAL BANK OF BOSTON,
as Administration Agent, Syndication Agent,
and a Bank
By:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Managing Director, High Technology
Division, Medical Technology Group
Address for Notices:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Lending Office for Base Rate Advances:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
P. 0. Box 2016
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Lending Office for Eurodollar Advances:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
49
NATIONSBANK:
NATIONSBANK OF TEXAS, N.A.,
as Documentation Agent and a Bank
By:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Senior Vice President
Address for Notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Lending Office for Base Rate Advances:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
Post Office Box 831000
Dallas, Texas 75283-1000
Lending Office for Eurodollar Advances:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
50