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CREDIT AGREEMENT
dated as of October 9, 1997
by and among
THE MULTICARE COMPANIES, INC. and
CERTAIN OF ITS SUBSIDIARIES, AS BORROWERS,
THE FINANCIAL INSTITUTIONS IDENTIFIED HEREIN, AS LENDERS,
MELLON BANK, N.A., AS ISSUER OF LETTERS OF CREDIT,
MELLON BANK, N.A., AS ADMINISTRATIVE AGENT,
CITICORP USA, INC., AS SYNDICATION AGENT,
FIRST UNION NATIONAL BANK, AS DOCUMENTATION AGENT
NATIONSBANK, N.A., AS SYNDICATION AGENT, and
OTHER AGENTS IDENTIFIED HEREIN
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TABLE OF CONTENTS
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ARTICLE 1
CREDIT FACILITY............................................................ 2
1.1 COMMITMENT TO LEND............................................. 2
1.2 JOINT AND SEVERAL OBLIGATIONS.................................. 3
1.3 MANNER OF BORROWING............................................ 3
1.4 SCHEDULED REPAYMENTS........................................... 6
1.5 VOLUNTARY PREPAYMENTS AND UNSCHEDULED,
MANDATORY PREPAYMENTS........................................ 9
1.6 PAYMENTS BY THE BORROWERS IN GENERAL........................... 13
1.7 REDUCTIONS OF RC COMMITMENT.................................... 15
1.8 INTEREST....................................................... 15
1.9 FEES........................................................... 17
1.10 COMPUTATION OF INTEREST AND FEES............................... 18
1.11 PROMISSORY NOTES; RECORDS OF ACCOUNT........................... 18
1.12 PRO RATA TREATMENT............................................. 19
1.13 TAXES ON PAYMENTS.............................................. 19
1.14 REGISTERED NOTES AND LOANS..................................... 21
ARTICLE 2
YIELD PROTECTION AND BREAKAGE INDEMNITY.................................... 23
2.1 MANDATORY SUSPENSION AND CONVERSION OF LIBO RATE
LOANS........................................................ 23
2.2 REGULATORY CHANGES............................................. 24
2.3 CAPITAL AND RESERVE REQUIREMENTS............................... 25
2.4 BREAKAGE....................................................... 25
2.5 DETERMINATIONS................................................. 25
2.6 REPLACEMENT OF LENDERS......................................... 26
2.7 CHANGE OF LENDING OFFICE....................................... 26
ARTICLE 3
LETTERS OF CREDIT.......................................................... 28
3.1 ISSUANCE OF LETTERS OF CREDIT.................................. 28
ARTICLE 4
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CONDITIONS TO EFFECTIVENESS OF AGREEMENT
AND FUNDINGS................................................................ 33
4.1 CONDITIONS TO EFFECTIVENESS OF AGREEMENT AND
INITIAL FUNDING............................................... 33
4.2 CONDITIONS TO EACH LOAN AND ISSUANCE OF EACH LETTER
OF CREDIT..................................................... 38
ARTICLE 5
REPRESENTATIONS AND WARRANTIES.............................................. 40
5.1 REPRESENTATIONS................................................. 40
5.2 REPRESENTATIONS AND WARRANTIES ABSOLUTE......................... 48
ARTICLE 6
AFFIRMATIVE COVENANTS....................................................... 49
6.1 REPORTING REQUIREMENTS.......................................... 49
6.2 MAINTENANCE OF EXISTENCE........................................ 54
6.3 CONDUCT OF BUSINESS AND MAINTENANCE OF LICENSES
AND OTHER PROPERTY.............................................. 54
6.4 MAINTENANCE OF RECORDS; FISCAL YEAR............................. 55
6.5 COMPLIANCE WITH LAWS....................................... 55
6.6 ERISA........................................................... 55
6.7 RIGHT OF INSPECTION............................................. 56
6.8 INSURANCE....................................................... 57
6.9 PAYMENT OF TAXES AND OTHER CHARGES.............................. 57
6.10 SUBSIDIARIES TO BE BORROWERS.................................... 57
6.11 PRESERVATION OF STATUS AS SENIOR INDEBTEDNESS................... 58
6.12 INTEREST RATE HEDGING AGREEMENTS................................ 58
6.13 CORPORATE SEPARATENESS.......................................... 58
6.14 TRANSACTIONS WITH AFFILIATES.................................... 59
6.15 CASH PROCEEDS OF EQUITY OF SURETY............................... 59
6.16 CAPITAL STOCK................................................... 59
6.17 USE OF PROCEEDS................................................. 59
6.18 CERTAIN DISPOSITIONS............................................ 59
ARTICLE 7
FINANCIAL COVENANTS......................................................... 60
7.1 CERTAIN FINANCIAL COVENANTS..................................... 60
7.2 CALCULATION OF FINANCIAL COVENANTS.............................. 61
ARTICLE 8
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NEGATIVE COVENANTS......................................................... 62
8.1 INDEBTEDNESS................................................... 62
8.2 LIENS.......................................................... 64
8.3 LOANS, ADVANCES AND INVESTMENTS................................ 65
8.4 ACQUISITIONS, ETC.............................................. 66
8.5 DISPOSITIONS................................................... 67
8.6 ISSUANCE OF SUBSIDIARY STOCK OR OTHER OWNERSHIP
INTERESTS.................................................... 68
8.7 LEASES......................................................... 69
8.8 DIVIDENDS AND RELATED DISTRIBUTIONS............................ 69
8.9 CONSOLIDATED TAX RETURN........................................ 69
8.10 LIMITATION ON PAYMENTS, PREPAYMENTS,
DEFEASEMENT AND OTHER ACTION WITH RESPECT TO
CERTAIN DEBT OBLIGATIONS..................................... 70
8.11 LIMITATIONS ON MODIFICATION OF CERTAIN DOCUMENTS............... 70
8.12 LIMITATION ON CERTAIN RESTRICTIVE PROVISIONS................... 71
8.13 LIMITATIONS ON MERGERS, ETC.................................... 71
8.14 AVOIDANCE OF OTHER CONFLICTS................................... 71
8.15 CAPITAL EXPENDITURES........................................... 71
8.16 MANAGEMENT FEE................................................. 71
ARTICLE 9
DEFAULTS................................................................... 73
9.1 "EVENTS OF DEFAULT............................................. 73
9.2 CONSEQUENCES OF AN EVENT OF DEFAULT............................ 76
9.3 APPLICATION OF PROCEEDS........................................ 77
ARTICLE 10
THE ADMINISTRATIVE AGENT................................................... 79
10.1 APPOINTMENT.................................................... 79
10.2 GENERAL NATURE OF ADMINISTRATIVE AGENT'S DUTIES................ 79
10.3 EXERCISE OF POWERS............................................. 80
10.4 GENERAL EXCULPATORY PROVISIONS................................. 80
10.5 ADMINISTRATION BY THE ADMINISTRATIVE AGENT..................... 81
10.6 LENDER PARTIES NOT RELYING ON ADMINISTRATIVE
AGENT OR OTHER LENDERS....................................... 82
10.7 INDEMNIFICATION................................................ 82
10.8 REGISTER....................................................... 83
10.9 SUCCESSOR ADMINISTRATIVE AGENT................................. 83
10.10 ADDITIONAL ADMINISTRATIVE AGENTS; COLLATERAL
AGENT........................................................ 83
10.11 CALCULATIONS................................................... 84
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10.12 OTHER AGENTS.................................................. 84
10.13 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY............... 84
ARTICLE 10A
SPECIAL INTERCREDITOR PROVISIONS........................................... 86
10A.1 SPECIAL PROVISIONS APPLICABLE TO LENDER PARTIES AS
PARTIES TO THE GENESIS CREDIT AGREEMENT..................... 86
ARTICLE 10B
SPECIAL INTER-BORROWER PROVISIONS.......................................... 87
10B.1 CERTAIN BORROWER ACKNOWLEDGEMENTS............................. 87
10B.2 CERTAIN INTER-BORROWER AGREEMENTS............................. 87
10B.3 RECORDS....................................................... 88
ARTICLE 11
DEFINITIONS; CONSTRUCTION.................................................. 89
11.1 CERTAIN DEFINITIONS........................................... 89
11.2 CONSTRUCTION..................................................112
11.3 ACCOUNTING PRINCIPLES.........................................113
ARTICLE 12
MISCELLANEOUS..............................................................114
12.1 NOTICES.......................................................114
12.2 PRIOR UNDERSTANDINGS; ENTIRE AGREEMENT........................114
12.3 SEVERABILITY..................................................114
12.4 DESCRIPTIVE HEADINGS..........................................115
12.5 GOVERNING LAW.................................................115
12.6 NON-MERGER OF REMEDIES........................................115
12.7 NO IMPLIED WAIVER; CUMULATIVE REMEDIES........................115
12.8 AMENDMENTS; WAIVERS...........................................116
12.9 SUCCESSORS AND ASSIGNS........................................117
12.10 COUNTERPARTS; PHOTOCOPIED OR TELECOPIED SIGNATURE
PAGES.......................................................119
12.11 MAXIMUM LAWFUL INTEREST RATE..................................119
12.12 INDEMNIFICATION...............................................120
12.13 EXPENSES......................................................121
12.14 MAXIMUM AMOUNT OF JOINT AND SEVERAL LIABILITY.................122
12.15 AUTHORIZATION OF MULTICARE BY OTHER BORROWERS.................122
12.16 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY...............123
12.17 CERTAIN WAIVERS BY BORROWERS..................................123
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12.18 SET-OFF.......................................................123
12.19 SHARING OF COLLECTIONS........................................124
12.20 OTHER LOAN DOCUMENTS..........................................124
12.21 CERTAIN BORROWER ACKNOWLEDGEMENTS.............................124
12.22 CONSENT TO JURISDICTION, SERVICE AND VENUE; WAIVER
OF JURY TRIAL...............................................124
LIST OF SCHEDULES..........................................................253
LIST OF EXHIBITS...........................................................254
SCHEDULE 6.10..............................................................255
SCHEDULE 8.4...............................................................257
SCHEDULE 8.5(h)............................................................259
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of October 9, 1997, by and among
THE MULTICARE COMPANIES, INC., a Delaware corporation (together with its
successors, "Multicare"), the Subsidiaries of Multicare referred to on the
signature pages hereto and such other Subsidiaries of Multicare which may from
time to time become Borrowers hereunder in accordance with the provisions hereof
(collectively with Multicare, the "Borrowers"), the Lenders referred to on the
signature pages hereto (together with other lenders parties hereto from time to
time pursuant to Section 12.9 below and their successors and assigns, the
"Lenders"), MELLON BANK, N.A., a national banking association, as issuer of
Letters of Credit hereunder (in such capacity, together with its successors and
assigns in such capacity, the "Issuer"), MELLON BANK, N.A., a national banking
association, as Administrative Agent for itself and for the other Agents, the
Lenders and the Issuer hereunder (in such capacity, together with its successors
and assigns in such capacity, the "Administrative Agent"), and CITICORP USA,
INC., a Delaware corporation, as Syndication Agent, NATIONSBANK, N.A., a
national banking association, as Syndication Agent, and FIRST UNION NATIONAL
BANK, a national banking association, as Documentation Agent. Certain terms used
herein are defined in Article 11 below.
W I T N E S S E T H T H A T
WHEREAS, Acquisition Corp. has acquired (or will be acquiring
simultaneously with the execution of this Agreement) all of the shares of common
stock of Multicare and has merged into, or simultaneously with the execution of
this Agreement will merge into, Multicare, with Multicare being the surviving
entity; and
WHEREAS, Multicare has requested that the Lenders extend the Loans
to the Borrowers for the purposes described herein; and
WHEREAS, as more particularly set forth in the Pledge Agreement,
certain collateral securing the obligations hereunder is to be shared with
certain creditors party to the Qualifying Interest Rate Hedging Agreement (as
such term is defined in Article 11 below).
WHEREAS, the Lenders have agreed to extend the Loans to the
Borrowers on the terms and conditions described herein; and
WHEREAS, ALL OBLIGATIONS HEREUNDER AND UNDER EACH AGREEMENT AND
INSTRUMENT DELIVERED IN CONNECTION HEREWITH FROM TIME TO TIME ARE "SENIOR
INDEBTEDNESS" AND ARE HEREBY DESIGNATED BY MULTICARE AS "DESIGNATED SENIOR
INDEBTEDNESS" WITHIN THE MEANING OF THE 1997 SUBORDINATED NOTE INDENTURE.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained and intending to be legally bound hereby, the parties
hereto hereby agree as follows.
ARTICLE 1
CREDIT FACILITY
1.1 COMMITMENT TO LEND.
(a) Term Loans.
(i) Tranche A Term Loans. Upon the terms and subject to the
conditions of this Agreement, each Tranche A Lender agrees to make, on the
Closing Date, a Loan (a "Tranche A Term Loan") to the Borrowers in the amount of
such Lender's Tranche A Commitment. The total amount of the Tranche A Commitment
of all Tranche A Lenders on the Agreement Date is $200,000,000.00.
(ii) Tranche B Term Loans. Upon the terms and subject to the
conditions of this Agreement, each Tranche B Lender agrees to make, on the
Closing Date, a Loan (a "Tranche B Term Loan") to the Borrowers in the amount of
such Lender's Tranche B Commitment. The total amount of the Tranche B Commitment
of all Tranche B Lenders on the Agreement Date is $150,000,000.00.
(iii) Tranche C Term Loans. Upon the terms and subject to the
conditions of this Agreement, each Tranche C Lender agrees to make, on the
Closing Date, a Loan (a "Tranche C Term Loan") to the Borrowers in the amount of
such Lender's Tranche C Commitment. The total amount of the Tranche C Commitment
of all Tranche C Lenders on the Agreement Date is $50,000,000.00.
(b) Revolving Credit Loans. Upon the terms and subject to the
conditions of this Agreement, each RC Lender agrees to make, from time to time
during the period from and including the Closing Date to but excluding the RC
Maturity Date, one or more Loans ("RC Loans") to the Borrowers in an aggregate
unpaid principal amount not exceeding at any time such Lender's RC Commitment at
such time; provided, however, that the Borrowers shall not request, and the
Lenders shall have no obligation to make, any RC Loans at any time in excess of
the Available RC Commitment. The total amount of the RC Commitment of all RC
Lenders on the Agreement Date is $125,000,000.00.
(c) Swing Loans. Upon the terms and subject to the conditions of
this Agreement, the Swing Loan Lender agrees to make, from time to time, from
and including the Closing Date to but excluding the RC Maturity Date, one or
more Swing Loans to the
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Borrowers, in an aggregate unpaid principal amount not exceeding at any time
$10,000,000.00, provided however that no Swing Loan shall be made at any time in
an amount in excess of the Available RC Commitment. Each Swing Loan shall be in
a principal amount equal to $500,000.00 or an integral multiple thereof and
shall be made and maintained as a Prime Rate Loan unless a fixed rate shall be
agreed upon by the Swing Loan Lender and Multicare (on behalf of the Borrowers).
All Swing Loans shall be disbursed by the Swing Loan Lender in Dollars in funds
immediately available to Multicare (on behalf of the Borrowers) by crediting an
account of Multicare at the Swing Loan Lender's Domestic Lending Office, or in
such other manner as may have been specified in the applicable notice of
borrowing and as shall be acceptable to the Swing Loan Lender.
1.2 JOINT AND SEVERAL OBLIGATIONS.
WHETHER OR NOT EXPRESSLY STATED HEREIN OR IN ANY OTHER LOAN
DOCUMENT, ALL OBLIGATIONS OF THE BORROWERS (OR OF ANY BORROWER) HEREUNDER AND
UNDER EACH OTHER LOAN DOCUMENT (WHETHER IN CONNECTION WITH LOANS, LETTERS OF
CREDIT OR OTHER OBLIGATIONS) ARE JOINT AND SEVERAL OBLIGATIONS OF ALL BORROWERS.
1.3 MANNER OF BORROWING.
(a) Notice of Borrowing. Except for requests for Swing Loans which
shall be governed by paragraph (e) below, Multicare (on behalf of the Borrowers)
shall give the Administrative Agent notice (which shall be irrevocable), in the
case of Prime Rate Loans, no later than 11:00 a.m. (Philadelphia, Pennsylvania
time) one Business Day prior to the requested date for the making of such Loans
and, in the case of LIBO Rate Loans, 11:00 a.m. (Philadelphia, Pennsylvania,
time) three Business Days before the requested date for the making of such
Loans. Each such notice shall be in the form of Exhibit B hereto and shall
specify (i) whether the requested Loans are to be Tranche A Term Loans, Tranche
B Term Loans, Tranche C Term Loans or RC Loans, (ii) the requested date for the
making of such Loans which date shall be a Business Day, (iii) the Type or Types
of Loans requested and (iv) the amount of each such Type of Loan, which amount
shall be $5,000,000.00 or any integral multiple of $1,000,000.00 in excess
thereof (except that in the case of RC Loans, the amount of the requested Loan
may be less if the amount requested is equal to the total Available RC
Commitment). Upon receipt of any such notice, the Administrative Agent shall
promptly notify each applicable Lender of the contents thereof and of the amount
and Type of each Loan to be made by such Lender on the requested date specified
therein.
(b) Funding by Lenders. Not later than 12:00 noon (Philadelphia,
Pennsylvania time) on each requested date for the making of Loans (other than
Swing Loans), each Lender shall make available to the Administrative Agent, in
Dollars in funds immediately available to the Administrative Agent at the office
designated by the Administrative Agent, the Loans to be made by such Lender on
such date, provided however
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that if a Lender does not receive timely notice from the Administrative Agent as
set forth in paragraph (a) above, such Lender shall fund the required amount
promptly upon receipt of such notice. The obligations of the Lenders hereunder
are several; accordingly, any Lender's failure to make any Loan to be made by it
on the requested date therefor shall not relieve any other Lender of its
obligation to make any Loan to be made by it on such date, but the latter shall
not be liable for the former's failure.
(c) Permitted Assumption as to Funding. Unless the Administrative
Agent shall have received notice from a Lender prior to 11:00 a.m.
(Philadelphia, Pennsylvania time) on the requested date for the making of any
Loan (other than a Swing Loan) that such Lender will not make available to the
Administrative Agent the Loan requested to be made by it on such date, the
Administrative Agent may assume that such Lender has made such Loan available.
The Administrative Agent in its sole discretion and in reliance upon such
assumption, may make available to the Borrowers on the requested date a
corresponding amount on behalf of such Lender. If and to the extent such Lender
shall not have made available to the Administrative Agent the Loans requested to
be made by such Lender on such date and the Administrative Agent shall have so
made available to the Borrowers a corresponding amount on behalf of such Lender,
(i) such Lender shall, on demand, pay to the Administrative Agent such
corresponding amount together with interest thereon, for each day from the date
such amount shall have been so made available by the Administrative Agent to the
Borrowers until the date such amount shall have been paid in full to the
Administrative Agent, at the Federal Funds Rate until (and including) the third
Business Day after demand is made and thereafter at the Prime Rate, and (ii) the
Administrative Agent shall be entitled to all interest payable by Borrowers on
such amount for the period commencing on the date such amount was advanced by
the Administrative Agent to but not including the date on which such amount is
received by the Administrative Agent from such Lender. Moreover, any Lender that
shall have failed to make available the required amount shall not be entitled to
vote on such matters as Lenders or Required Lenders are otherwise entitled to
vote on or consent to or approve under this Agreement and the other Loan
Documents until such amount with interest is paid in full to the Administrative
Agent by such Lender. Without limiting any obligations of any Lender pursuant to
this paragraph (c), if such Lender does not pay such corresponding amount
promptly upon the Administrative Agent's demand therefor, the Administrative
Agent shall notify Multicare (on behalf of the Borrowers) and the Borrowers
shall promptly repay such corresponding amount to the Administrative Agent
together with accrued interest thereon at the applicable rate or rates on such
Loans.
(d) Disbursements of Funds to Borrowers. All amounts made available
to the Administrative Agent in accordance with paragraph (b) above shall be
disbursed by the Administrative Agent promptly but in any event not later than
4:00 p.m. (Philadelphia, Pennsylvania time) on the requested date therefor in
Dollars, in funds immediately available to the Borrowers by crediting such
amount to an account of Multicare at the Administrative Agent's Domestic Lending
Office or in such other manner as may be agreed to by Multicare and the
Administrative Agent.
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(e) Special Provisions Respecting Swing Loans.
(i) Request for Borrowing. Multicare (on behalf of the Borrowers)
shall give the Swing Loan Lender notice (which shall be irrevocable) of a
request for a Swing Loan (with a copy to the Administrative Agent) no later than
12:00 noon (Philadelphia, Pennsylvania time) on the day such Loan is requested;
if such notice is received later than 12:00 noon (Philadelphia, Pennsylvania
time), then the request shall be deemed to be a request for a Swing Loan to be
made on the next Business Day. The Swing Loan Lender shall provide prompt notice
to the Administrative Agent of the making of any Swing Loans to the Borrowers.
(ii) Participation by RC Lenders. Upon demand made to all of the RC
Lenders by the Swing Loan Lender, which demand may be made before or after a
Default (including a Default arising under Section 9.1(m) (Insolvency,
Bankruptcy, Etc.)), and before or after the maturity date of the subject Swing
Loans but subject to the provisions of paragraph (iv) below, each RC Lender
(other than the Swing Loan Lender) shall promptly, irrevocably and
unconditionally purchase from the Swing Loan Lender, without recourse or
warranty, an undivided interest and participation in the Swing Loans then
outstanding. Each RC Lender shall effect such purchase by paying to the Swing
Loan Lender, without reduction or deduction of any kind, including reductions or
deductions for set-off, recoupment or counterclaim, in Dollars immediately
available to the Swing Loan Lender at the Swing Loan Lender's Domestic Lending
Office, an amount equal to such RC Lender's pro rata share of the principal
amount of all Swing Loans then outstanding. Each RC Lender's pro rata share of
the Swing Loans shall be based on the amount of such RC Lender's pro rata share
of the total RC Commitment. Thereafter, the RC Lenders' respective interests in
such Swing Loans, and the remaining interest of the Swing Loan Lender in such
Swing Loans, shall in all respects be treated as RC Loans under this Agreement,
except that subject to Section 1.8(d) (Default Rate) such Swing Loans shall
continue to bear interest at the rate specified for such Swing Loans until such
Swing Loans are due and payable and such Swing Loans shall be due and payable by
the Borrowers on the dates referred to in Section 1.4(e). If any RC Lender does
not pay any amount which it is required to pay promptly upon the Swing Loan
Lender's demand therefor, (i) the Swing Loan Lender shall be entitled to recover
such amount on demand from such RC Lender, together with interest thereon, at
the Federal Funds Rate for the first three Business Days, and thereafter at the
Prime Rate, for each day from the date of such demand, if made prior to 2:00
p.m. (Philadelphia, Pennsylvania time) on any Business Day, or, if made at any
later time, from the next Business Day following the date of such demand, until
the date such amount is paid in full to the Swing Loan Lender by such RC Lender
and (ii) the Swing Loan Lender shall be entitled to all interest payable by the
Borrowers on such amount until the date on which such amount is received by the
Swing Loan Lender from such RC Lender. Moreover, any RC Lender that shall fail
to make available the required amount shall not be entitled to vote on or
consent to or approve any matter under this Agreement and the other Loan
Documents until such amount with interest is paid in full to the Swing Loan
Lender by such RC Lender. Without limiting any obligations of any RC Lender
pursuant to this paragraph (ii), if such RC Lender does not pay
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such corresponding amount promptly upon the Swing Loan Lender's demand therefor,
the Swing Loan Lender shall notify Multicare (on behalf of the Borrowers) and
the Borrowers shall promptly repay such corresponding amount to the Swing Loan
Lender together with accrued interest thereon at the applicable rate on such
Swing Loans.
(iii) No Set-off, Etc. Subject only to the limitations set forth in
the following paragraph (iv), the obligations of each RC Lender to make
available to the Swing Loan Lender the amounts set forth in the preceding
paragraph (ii) shall be absolute, unconditional and irrevocable under any and
all circumstances without reduction for any set-off or counterclaim of any
nature whatsoever and may not be terminated, suspended or delayed for any reason
whatsoever, shall not be subject to qualification or exception and shall be made
in accordance with the terms of this Agreement.
(iv) Certain Limitations. No RC Lender shall be obligated to
purchase a participation in any Swing Loan if such RC Lender proves that (A) the
Swing Loan Lender did not in good faith believe that the conditions specified in
clauses (i), (iii), and (iv) of Section 4.2(a) were satisfied at the time such
Swing Loan was made (unless such condition was waived in accordance with the
terms of this Agreement) or (B) such RC Lender had actual knowledge that any
such condition had not been satisfied and notified the Swing Loan Lender in a
writing received by the Swing Loan Lender at least one Business Day prior to the
time that it made such Swing Loan that the Swing Loan Lender was not authorized
to make such Swing Loan and stating with specificity the reason therefor.
1.4 SCHEDULED REPAYMENTS.
(a) Tranche A Term Loans. The Tranche A Term Loans shall mature and
become due and payable and shall be repaid by the Borrowers in quarterly
installments, payable on successive Quarterly Payment Dates commencing on the
first Quarterly Payment Date after the Closing Date and ending on the Tranche A
Maturity Date (whether or not such date would otherwise be a Quarterly Payment
Date). Each such installment shall be in an amount equal to one quarter of the
amount set forth below for the applicable year, provided that the final
installment shall be in an amount equal to the aggregate amount of the Tranche A
Term Loans then outstanding.
Year Ending Amount (Assuming Full Percent of
----------- $200,000,000.00 is Borrowed Tranche A Term Loan
and Not Otherwise Prepaid) -------------------
---------------------------
September 30, 1998 $24,000,000.00 12%
September 30, 1999 $28,000,000.00 14%
September 30, 2000 $32,000,000.00 16%
September 30, 2001 $36,000,000.00 18%
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Year Ending Amount (Assuming Full Percent of
----------- $200,000,000.00 is Borrowed Tranche A Term Loan
and Not Otherwise Prepaid) -------------------
---------------------------
September 30, 2002 $40,000,000.00 20%
September 30, 2003 $40,000,000.00 20%
In the event that less than the full amount of the Tranche A Term Loans is
advanced, the amount of each annual repayment will be equal to the amount
actually advanced multiplied by the applicable percentage shown above as such
amount may be further reduced pursuant to Section 1.5 below.
(b) Tranche B Term Loans. The Tranche B Term Loans shall mature and
become due and payable and shall be repaid by the Borrowers in quarterly
installments, payable on successive Quarterly Payment Dates commencing with the
first Quarterly Payment Date after the Closing Date and ending with the Tranche
B Maturity Date (whether or not such date would otherwise be a Quarterly Payment
Date). Each such installment shall be in an amount equal to one quarter of the
amount set forth below for the applicable year, provided that the final
installment shall be in an amount equal to the aggregate amount of Tranche B
Term Loans then outstanding.
Year Ending Amount (Assuming Full Percent of
----------- $150,000,000.00 is Borrowed Tranche B Term Loan
and Not Otherwise Prepaid) -------------------
---------------------------
September 30, 1998 $1,500,000.00 1%
September 30, 1999 $1,500,000.00 1%
September 30, 2000 $1,500,000.00 1%
September 30, 2001 $1,500,000.00 1%
September 30, 2002 $1,500,000.00 1%
September 30, 2003 $1,500,000.00 1%
September 30, 2004 $141,000,000.00 94%
In the event that less than the full amount of the Tranche B Term Loans is
advanced, the amount of each annual repayment will be equal to the amount
actually advanced multiplied by the applicable percentage shown above, as such
amount may be further reduced pursuant to Section 1.5 below.
(c) Tranche C Term Loans. The Tranche C Term Loans shall mature and
become due and payable and shall be repaid by the Borrowers in quarterly
installments, payable on each successive March 1, June 1, September 1 and
December 1 commencing with December 1, 1997 and ending with the Tranche C
Maturity Date (whether or not such date
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would otherwise be a date specified above in this paragraph (c)). Each such
installment shall be in an amount equal to one quarter (except that for the year
ending June 1, 1998 each such installment shall be in an amount equal to one
third) of the amount set forth below for the applicable year, provided that the
final installment shall be in an amount equal to the aggregate amount of Tranche
C Term Loans then outstanding.
Year Ending Amount (Assuming Full Percent of
----------- $50,000,000.00 is Borrowed Tranche C Term Loan
and Not Otherwise Prepaid) -------------------
---------------------------
June 1, 1998 $ 500,000.00 1%
June 1, 1999 $ 500,000.00 1%
June 1, 2000 $ 500,000.00 1%
June 1, 2001 $ 500,000.00 1%
June 1, 2002 $ 500,000.00 1%
June 1, 2003 $ 500,000.00 1%
June 1, 2004 $ 500,000.00 1%
June 1, 2005 $46,500,000.00 93%
In the event that less than the full amount of the Tranche C Term Loans is
advanced, the amount of each annual repayment will be equal to the amount
actually advanced multiplied by the applicable percentage shown above, as such
amount may be further reduced pursuant to Section 1.5 below.
(d) RC Loans. The aggregate outstanding principal amount of the RC
Loans shall mature and become due and payable, and shall be repaid by the
Borrowers, on the RC Maturity Date.
(e) Swing Loans. The Borrowers shall repay each Swing Loan no later
than 3:00 p.m. (Philadelphia, Pennsylvania time) on the date specified in the
notice of borrowing delivered under Section 1.3(e) (which shall be a date not
later than the earlier of (A) the fifth Business Day after the date on which
such Swing Loan is to be made and (B) the RC Maturity Date). The Swing Loan
Lender shall provide prompt notice to the Administrative Agent of any repayment
of Swing Loans by the Borrowers.
(f) Letters of Credit. The Borrowers shall reimburse the Issuer,
through the Administrative Agent, for each Drawing under a Letter of Credit on
the date determined with respect to such Drawing in the manner set forth in
Article 3 below. In addition, the Borrowers shall fund the cash collateral
account securing Letter of Credit obligations in the
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manner set forth in Article 3 below.
1.5 VOLUNTARY PREPAYMENTS AND UNSCHEDULED, MANDATORY
PREPAYMENTS.
(a) Optional Prepayments. The Borrowers may, at any time and from
time to time, prepay the Loans in whole or in part, without premium or penalty
(but with any payment required under Section 2.4 (Breakage)), except that any
optional partial prepayment (other than a prepayment of all outstanding RC
Loans) shall be in an aggregate principal amount of $5,000,000.00 or any
integral multiple of $1,000,000.00 in excess thereof except that a Swing Loan
(prior to the time that the Swing Loan Lender makes a demand under Section
1.3(e)(ii)) may be prepaid in an aggregate principal amount of $500,000.00 or
any integral multiple thereof. Amounts to be so prepaid shall irrevocably be due
and payable on the date specified in the applicable notice of prepayment
delivered pursuant to paragraph (c) of this Section 1.5 together with interest
thereon as provided in Section 1.8 (Interest) and together with any payment
required under Section 2.4 (Breakage).
(b) Mandatory Prepayments.
(i) Excess Cash Flow. For each fiscal year of the Borrowers
commencing with the fiscal year ending December 31, 1998, upon the earlier of
(A) the date on which the Administrative Agent receives the annual financial
statements specified in Section 6.1 hereof and (B) the date by which the
Borrowers are required to provide such financial statements, the Borrowers shall
prepay a portion of the Loans in an amount equal to fifty percent (50%) of the
Excess Cash Flow for such fiscal year.
(ii) Net Proceeds of Dispositions. No more than five (5)
Business Days after the date of any sale, assignment, transfer or other
disposition after the Agreement Date by any Borrower of any assets (other than
pursuant to paragraphs (a), (b), (c) or (e) of Section 8.5 below) whether now
owned or hereafter acquired (collectively, a "disposition of assets"),
Multicare, on behalf of the Borrowers, shall notify the Administrative Agent in
writing that such disposition of assets has occurred, the date of such event and
the amount of the Net Cash Proceeds received in connection therewith. The
Administrative Agent shall promptly forward a copy of such notice to each Lender
Party. In the event that the Borrowers sell, assign, transfer or otherwise
dispose of the assets identified on Schedule 8.5(d) or in Section 6.18 hereof,
then on or before the day of such sale, Multicare, on behalf of the Borrowers,
shall give written notice of prepayment to the Administrative Agent and shall
repay the Loans in an amount equal to the amount of such Net Cash Proceeds. In
the case of a disposition of assets other than those identified on Schedule
8.5(d) or in Section 6.18 hereof, in the event that the Borrowers have not,
within 364 days after the date of any such disposition of assets, reinvested all
of the corresponding Net Cash Proceeds in their business pursuant to an
Acquisition in property or assets (other than current assets) of a nature or
type or that are used in a business (or in a company having property and assets
of a nature or type, or engaged in a business) similar or related to the nature
or type of the property and assets of, or the business of the Borrowers on the
date of such Acquisition, which is permitted by Section 8.4 (and so state in
reasonable detail in a certificate delivered by Multicare (on their behalf) to
the Administrative Agent), then, Multicare, on behalf of the Borrowers, shall
give written notice of prepayment to the Administrative Agent at least five
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(5) days prior to the date of the subject prepayment, and on or before the 364th
day following such sale shall repay the Loans in an amount equal to the amount
of such Net Cash Proceeds not so reinvested. Notwithstanding anything to the
contrary contained in this Agreement, in the event there occurs a disposition of
assets which would otherwise result in a mandatory prepayment under the 1997
Subordinated Notes to the extent the Borrowers are not otherwise required to
make a mandatory prepayment hereunder, the Borrowers shall be obligated to make
a mandatory prepayment hereunder in an amount not less than the amount, and at a
time not later than such time, necessary to avoid any required prepayment under
the 1997 Subordinated Notes and the 1997 Subordinated Note Indenture.
(iii) Net Proceeds of Sales of Capital Stock or Issuance of
Debt. Within five (5) days of (1) the sale or issuance of any capital stock or
debt securities of any Borrower (other than a sale to a Borrower), or (2) equity
contributed by Surety raised from Persons other than Cypress, TPG, Nazem or
Genesis in respect of common stock, the Borrowers shall prepay a portion of the
Loans in an amount equal to the amount of the Net Cash Proceeds of such sale of
stock or debt securities or equity contribution.
(c) Application and Timing of Prepayments.
(i) Notice. Subject to the provisions of the last sentence of
this paragraph (i), the Borrowers shall give the Administrative Agent notice of
each prepayment of Loans, which notice, in the case of a prepayment of Prime
Rate Loans, shall be given no later than 11:00 a.m. (Philadelphia, Pennsylvania
time) three (3) Business Days before and, in the case of a prepayment of LIBO
Rate Loans, no later than 11:00 A.M. (Philadelphia, Pennsylvania, time) five (5)
Business Days before, the date of such prepayment. Each such notice of
prepayment shall be in the form of Exhibit C hereto and shall specify (i) the
date such prepayment is to be made and (ii) whether the Loans to be prepaid are
Tranche A Term Loans, Tranche B Term Loans, Tranche C Term Loans, RC Loans, or
Swing Loans (consistent with the provisions of this Agreement), (iii) the amount
and Type and, in the case of any LIBO Rate Loan, the last day of the applicable
Interest Period for the Loan to be prepaid, (iv) whether the prepayment is a
voluntary prepayment pursuant to paragraph (a) of this Section 1.5 or a
mandatory prepayment pursuant to paragraph (b) of this Section 1.5 and (v) if a
mandatory prepayment, the reason therefor. Upon receipt of any such notice, the
Administrative Agent shall promptly notify each applicable Lender of the
contents thereof. Notwithstanding the foregoing, if the Borrowers wish to make a
prepayment of Swing Loans only, they may prepay such Swing Loans by giving the
Swing Loan Lender and the Administrative Agent written notice no later than
12:00 noon (Philadelphia time) one Business Day prior to the date of such
prepayment or as otherwise agreed to by Multicare (on behalf of the Borrowers)
and the Swing Loan Lender.
(ii) Timing and Application of Voluntary Prepayments and
Mandatory Prepayments from a Disposition Described in Section 6.18. Any
voluntary prepayments pursuant to paragraph (a) of this Section 1.5 or mandatory
prepayment resulting from a disposition of assets described in Section 6.18
shall be applied in the following order:
(1) First, prepayments shall be applied against the RC
Loans and Swing Loans but with no corresponding reduction in
the amount of the RC Commitment unless otherwise specified by
Multicare (on behalf of the Borrowers) and shall be applied
among the RC Loans and Swing
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Loans at the time outstanding on a pro rata basis in
accordance with the relative aggregate principal amounts
thereof held by each applicable Lender.
(2) Second, (subject to the terms of paragraph (d) below
(Tranche B/Tranche C Opt-Out)) prepayments shall be applied
against the Term Loans and shall be applied among the Tranche
A Term Loans, the Tranche B Term Loans and the Tranche C Term
Loans at the time outstanding on a pro rata basis in
accordance with the relative aggregate principal amounts
thereof held by each applicable Lender. Prepayments of the
various Term Loans shall be applied to each of the respective
remaining installments thereof set forth in Section 1.4 on a
pro rata basis in accordance with the relative amounts
thereof.
Any excess shall be applied to any other amounts owing in respect of the Loan
Obligations or deposited in the Letter of Credit cash collateral account if
required under Article 3 below and, if all such Loan Obligations have been then
paid in full and the amount of outstanding Letters of Credit is less than the
sum of the amount in the cash collateral account (as required) and the Available
RC Commitment, then any excess amount shall be returned to Multicare (on behalf
of the Borrowers) or as otherwise required by applicable Law.
(iii) Timing and Application of Mandatory Prepayments from the
Disposition of Assets Identified on Schedule 8.5(d). Any mandatory prepayments
pursuant to paragraph (b) of this Section 1.5 resulting from the disposition of
assets identified on Schedule 8.5(d) shall be applied in the following order:
(1) First, prepayments shall be applied against the
Tranche A Term Loan, on a pro rata basis in accordance with
the relative aggregate principal amounts held by each
applicable Lender. Prepayments of the Tranche A Term Loan
shall be applied to each of the respective remaining
installments thereof set forth in Section 1.4 on a pro rata
basis in accordance with the relative amounts thereof.
(2) Second, (subject to the terms of paragraph (d) below
(Tranche B/Tranche C Opt-Out)) prepayments shall be applied
against the Tranche B Term Loans and the Tranche C Term Loans
at the time outstanding on a pro rata basis in accordance with
the relative aggregate principal amounts thereof held by each
applicable Lender. Prepayments of the Tranche B Term Loans and
the Tranche C Term Loans shall be applied to each of the
respective remaining installments thereof set forth in Section
1.4 on a pro rata basis in accordance with the relative
amounts thereof.
(3) Third, prepayments shall be applied against the RC
Loans and Swing Loans with a corresponding reduction in the
amount of the RC Commitment and shall be applied among the RC
Loans and the Swing Loans at the time outstanding on a pro
rata basis in accordance with the relative aggregate principal
amount thereof held by each applicable Lender.
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Prepayments shall be applied to any other amounts owing in respect of the Loan
Obligations or deposited in the Letter of Credit cash collateral account and, if
all such Loan Obligations have been paid in full and the amount of outstanding
Letters of Credit is less than the sum of the amount in the cash collateral
account and the Available RC Commitment, then any excess shall be returned to
Multicare (on behalf of the Borrowers) or as otherwise required by applicable
law.
(iv) Timing and Application of Other Mandatory Prepayments.
Other than mandatory prepayments resulting from the disposition of assets
identified on Schedule 8.5(d) or from the disposition of assets described in
Section 6.18, any mandatory prepayments pursuant to paragraph (b) of this
Section 1.5 shall be applied in the following order:
(1) First, (subject to the terms of paragraph (d) below
(Tranche B/Tranche C Opt-Out)) prepayments shall be applied
against the Term Loans and shall be applied among the Tranche
A Term Loans, the Tranche B Term Loans and the Tranche C Term
Loans at the time outstanding on a pro rata basis in
accordance with the relative aggregate principal amounts
thereof held by each applicable Lender. Prepayments of the
various Term Loans shall be applied to each of the respective
remaining installments thereof set forth in Section 1.4 on a
pro rata basis in accordance with the relative amounts
thereof.
(2) Second, prepayments shall be applied against the RC
Loans and Swing Loans with a corresponding reduction in the
amount of the RC Commitment and shall be applied among the RC
Loans and the Swing Loans at the time outstanding on a pro
rata basis in accordance with the relative aggregate principal
amount thereof held by each applicable Lender provided,
however, the Borrowers need not prepay the RC Loans to the
extent that there would be, after giving effect to the
reduction in the amount of the RC Commitment (which commitment
reduction is unaffected by the terms of this proviso),
sufficient Available RC Commitment to reborrow such amounts.
The preceding proviso shall not apply to prepayments in
respect of Net Cash Proceeds of dispositions.
Any excess shall be applied to any other amounts owing in respect of the Loan
Obligations or deposited in the Letter of Credit cash collateral account and, if
all such Loan Obligations have been paid in full and the amount of outstanding
Letters of Credit is less than the sum of the amount in the cash collateral
account and the Available RC Commitment, then any excess amount shall be
returned to Multicare (on behalf of the Borrowers) or as otherwise required by
applicable Law.
(d) Tranche B/Tranche C Opt-Out. With respect to any prepayment of
the Tranche B Term Loans or Tranche C Term Loans, the Administrative Agent shall
ratably pay the Tranche B Lenders or Tranche C Lenders, as the case may be, as
required under paragraph (c) of this Section 1.5, unless the Administrative
Agent shall have received written notice from any Tranche B Lender or Tranche C
Lender, as the case may be, not later than 11:00 a.m. two (2) Business Days
prior to the date of such prepayment, that such Tranche B
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Lender or Tranche C Lender, as the case may be, elects not to receive any
prepayment under this paragraph (d) (a "Tranche B Opt-Out Lender" or "Tranche C
Opt-Out Lender", as applicable). Any prepayment which would have been remitted
to a Tranche B Opt-Out Lender or Tranche C Opt-Out Lender but for its election
to not receive such prepayment, shall be paid ratably to the remaining Lender
Parties in the order and as provided in paragraph (c) of this Section 1.5;
provided, however, that notwithstanding the foregoing provisions of this
paragraph (d), Tranche B Lenders and Tranche C Lenders must accept any
prepayment made pursuant to this Section 1.5 on any date on which the Tranche A
Term Loans have been paid in full (or are to be concurrently paid in full).
(e) Certain Provisions Respecting Prepayments Generally. Prepayments
shall be subject to the interest payment provisions, as applicable, set forth in
Section 1.8 and the breakage indemnity provisions, as applicable, set forth in
Section 2.4 below.
1.6 PAYMENTS BY THE BORROWERS IN GENERAL.
(a) Time, Place and Manner. All payments due to the Administrative
Agent under the Loan Documents shall be made to the Administrative Agent at the
office designated by the Administrative Agent on the signature pages hereto or
to such other Person or at such other address as the Administrative Agent may
designate by written notice to Multicare on behalf of the Borrowers. All
payments due to any Lender under the Loan Documents, whether made to the
Administrative Agent or directly to a Lender or the Issuer, shall be made for
the account of, in the case of payments in respect of LIBO Rate Loans, such
Lender's or Issuer's Eurodollar Lending Office and, in the case of all other
payments, such Lender's or Issuer's Domestic Lending Office. Except as otherwise
set forth in this Agreement, a payment shall not be deemed to have been made on
any day unless such payment has been received by the required Person, at the
required place of payment, in Dollars in funds immediately available to such
Person, no later than 1:00 p.m. (Philadelphia, Pennsylvania time) on such day;
provided, however, that the failure of the Borrowers to make any such payment by
such time shall not constitute a Default hereunder so long as such payment is
received no later than 3:00 p.m. (Philadelphia, Pennsylvania time) on such day,
but any such payment received later than 1:00 p.m. (Philadelphia, Pennsylvania
time) on such day shall be deemed to have been made on the next Business Day for
the purpose of calculating interest on the amount paid, provided further, that
any such payment made with the proceeds of Loans shall be deemed to have been
made on the date of the making of such Loans, so long as such proceeds are
immediately so applied and are not otherwise disbursed to the Borrowers.
(b) No Reductions. All payments due to the Administrative Agent, the
Issuer or any Lender under this Agreement and the other Loan Documents, shall be
made by the Borrowers without any reduction or deduction whatsoever, including
any reduction or deduction for any charge, set-off, holdback, recoupment or
counterclaim (whether sounding in tort, contract or otherwise).
(c) Authorization to Charge Accounts. The Borrowers hereby authorize
each Lender Party, each participant and each Affiliate of each Lender Party if
and to the extent any amount payable by the Borrowers under the Loan Documents
(whether payable to such Person or to any other Lender Party) is not otherwise
paid when due, to charge such amount
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against any or all of the demand deposit or other accounts of any Borrower with
such Person (whether maintained at a branch or office located within or without
the United States), with the Borrowers remaining jointly and severally liable
for any deficiency. The Person so charging any such account shall give the
relevant Borrower prompt notice thereof, but any failure to give or delay in
giving such notice shall not affect such Person's right to effect such charge.
Such charging of accounts shall be subject to the provisions of Section 12.19
hereof.
(d) Extension of Payment Dates if Not a Business Day. Whenever any
payment to the Administrative Agent, the Issuer or any Lender under the Loan
Documents would otherwise be due (except by reason of acceleration) on a day
that is not a Business Day, such payment shall instead be due on the next
succeeding Business Day unless, in the case of a payment of the principal of
LIBO Rate Loans, such extension would cause payment to be due in the next
succeeding calendar month, in which case such due date shall be advanced to the
next preceding Eurodollar Business Day. If the due date for any payment under
the Loan Documents is extended (whether by operation of any Loan Document,
applicable Law or otherwise), such payment shall bear interest for such extended
time at the rate of interest applicable hereunder.
(e) Disbursement of Payments to Lenders and Issuer. The
Administrative Agent shall promptly distribute to each applicable Lender Party
its ratable share of each payment received by the Administrative Agent under the
Loan Documents for the account of such Lender Party by crediting an account of
such Lender Party at the Administrative Agent's office or by wire transfer to an
account of such Lender Party at an office of any other commercial bank located
in the United States or at any Federal Reserve Bank designated by such Person.
Unless the Administrative Agent shall have received notice from Multicare (on
behalf of the Borrowers) prior to the date on which any payment is due to any
Lender Parties under the Loan Documents that the Borrowers will not make such
payment in full, the Administrative Agent may assume that the Borrowers have
made such payment in full to the Administrative Agent on such date and the
Administrative Agent, in its sole discretion may, in reliance upon such
assumption, cause to be distributed to each applicable Lender Party on such due
date, a corresponding amount with respect to the amount then due to such Person.
If and to the extent that the Borrowers shall not have so made such payment in
full to the Administrative Agent, and the Administrative Agent shall have so
distributed to such Lender or Lenders or the Issuer a corresponding amount, such
Lender Parties shall, on demand, repay to the Administrative Agent the amount so
distributed together with interest thereon, for each day from the date such
amount is distributed to such Lender Party until the date the such Person repays
such amount to the Administrative Agent, at the Federal Funds Rate until (and
including) the third Business Day after demand is made and thereafter at the
Prime Rate. Moreover, any Lender Party that shall have failed to make available
the required amount shall not be entitled to vote on such matters as Lenders or
Required Lenders are otherwise entitled to vote on or consent to or approve
under this Agreement and the other Loan Documents until such amount with
interest is paid in full to the Administrative Agent by such Lender. Nothing in
this Section 1.6 shall relieve the Borrowers from any payment obligations.
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(f) Breakage Costs on LIBO Rate Loans. Any repayment or prepayment
of a LIBO Rate Loan made on a day other than the last day of the applicable
Interest Period therefor shall be subject to payments in respect of breakage
costs as required to be paid in respect thereof pursuant to Section 2.4 below.
1.7 REDUCTIONS OF RC COMMITMENT.
(a) Optional Reductions. The Borrowers may reduce the RC Commitment
by giving the Administrative Agent notice (which shall be irrevocable) thereof
no later than 11:00 a.m. (Philadelphia, Pennsylvania, time) on the third
Business Day before the requested date of such reduction, provided, that each
partial reduction thereof shall be in an amount equal to $10,000,000.00 or any
integral multiple of $5,000,000.00 in excess thereof and, provided, further,
that no reduction shall reduce the RC Commitment to an amount less than the sum
of (i) the aggregate of the principal amount of all Swing Loans outstanding on
such date (after giving effect to any repayment of Swing Loans made on or prior
to such date), (ii) the aggregate of the principal amount of all RC Loans
outstanding on such date (after giving effect to any repayment or prepayment of
RC Loans made on or prior to such date), (iii) the aggregate amount of the
Contingent Reimbursement Obligations and (iv) the aggregate amount of all
unreimbursed Drawings. Upon receipt of any such notice, the Administrative Agent
shall promptly notify each RC Lender of the contents thereof and the amount
(based on a pro rata reduction to each RC Lender's Commitment) to which such RC
Lender's RC Commitment is to be reduced.
(b) Mandatory Reductions. At the time of any mandatory prepayment of
RC Loans pursuant to Section 1.5, the RC Commitment shall be reduced to the
extent required by said Section 1.5.
(c) No Reinstatement of RC Commitment. All reductions of the RC
Commitment are permanent and the RC Commitment cannot be restored without the
written consent of all RC Lenders.
1.8 INTEREST.
(a) Interest Rates in General. Except for Swing Loans which shall
bear the interest rate specified in Section 1.1(c) above, subject to the terms
and conditions of this Agreement, each Loan shall, at the option of the
Borrowers, bear interest on the outstanding principal amount thereof until paid
in full at a rate per annum equal to (i) the Prime Rate as in effect from time
to time or (ii) the applicable LIBO Rate for a specified Interest Period plus in
the case of both (i) and (ii) the Applicable Margin, if any.
(b) Election of LIBO Rate. Unless otherwise designated by the
Borrowers as a LIBO Rate Loan in accordance with this paragraph (b), each Loan
(other than a Swing Loan which is subject to Section 1.1(c) above) shall be
deemed to be a Prime Rate Loan as more fully set forth below.
(i) Prime Rate Unless Otherwise Designated. Prime Rate Loans
shall continue as Prime Rate Loans unless and until such Loans are converted
into Loans of
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another Type. LIBO Rate Loans for any Interest Period shall continue as Loans of
such Type until the end of the then current Interest Period therefor, at which
time they shall be automatically converted into Prime Rate Loans unless
Multicare (on behalf of the Borrowers) shall have given the Administrative Agent
notice in accordance with clause (ii) below requesting that such Loans continue
as LIBO Rate Loans for another Interest Period of a specified duration.
(ii) Election of LIBO Rate. To elect a LIBO Rate, Multicare
(on behalf of the Borrowers) shall give the Administrative Agent notice (which
shall be irrevocable) no later than 11:00 a.m. (Philadelphia, Pennsylvania,
time) three (3) Eurodollar Business Days before the requested date of the
funding, conversion or continuation which date shall be a Eurodollar Business
Day. Each such notice shall be in the form of Exhibit D hereto and shall specify
(A) the requested date of such funding, conversion or continuation, (B) whether
the subject Loan is a new advance or an existing Loan that is to be converted or
continued, (C) in the case of any LIBO Rate Loan being continued, the last day
of the current Interest Period, (D) whether such Loan is to be a Tranche A Term
Loan, Tranche B Term Loan, Tranche C Term Loan or an RC Loan and (E) the amount
of, and the desired Interest Period for, the Loan subject to such LIBO Rate
election provided that the Borrowers shall not be entitled to select an Interest
Period for any Loan which shall end on a date later than the Maturity Date
applicable to such Loan. Upon receipt of any such notice, the Administrative
Agent shall promptly notify each applicable Lender of the contents thereof.
(iii) LIBO Rate Suspended During Event of Default.
Notwithstanding anything to the contrary contained in clauses (i) or (ii) of
this paragraph (b), so long as an Event of Default shall have occurred and be
continuing, the Administrative Agent may (and, at the request of the Required
Lenders, shall) notify Multicare (on behalf of the Borrowers) that Loans may
only be converted into or continued upon the expiration of the applicable
current Interest Period therefor as Prime Rate Loans or Loans of such specified
Types as shall be acceptable to the Required Lenders. Thereafter, until no Event
of Default shall continue to exist, Loans may not be converted into or continued
as Loans of any Type other than Prime Rate Loans or one or more of such
specified Types.
(iv) Limitation on Types of Loans. Notwithstanding anything to
the contrary contained in this Agreement, the Borrowers shall borrow, prepay,
convert and continue Loans in a manner such that (A) unless otherwise agreed to
by the Administrative Agent, the aggregate principal amount of LIBO Rate Loans
of the same Type shall, at all times, be not less than $10,000,000.00 and (B)
there shall be, at any one time, no more than the number of Interest Periods
specified below in effect for each Tranche:
Maximum No. of
Interest Periods Tranche
---------------- -------
five (5) RC Loans
three (3) Tranche A
three (3) Tranche B
three (3) Tranche C
(v) Flexibility as to Source. Each Lender may fund LIBO Rate
Loans from any source that such Lender deems (in its sole discretion)
appropriate without
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loss of any rights hereunder.
(c) Interest Payment Dates. Interest shall be payable, (i) in the
case of Prime Rate Loans, quarterly in arrears on each Quarterly Payment Date,
(ii) in the case of LIBO Rate Loans, on the last day of each applicable Interest
Period (and, in the case of any LIBO Rate Loan having an Interest Period longer
than three months, on each three month anniversary of the first day of such
Interest Period) and (iii) in the case of any Loan (including Swing Loans), when
such Loan shall be due (whether at maturity, upon mandatory prepayment, by
reason of notice of prepayment or acceleration or otherwise) or converted, but
only to the extent then accrued on the amount then so due or converted.
(d) Default Rate. At any time that an Event of Default shall have
occurred and shall be continuing, any amount payable hereunder and under each
other Loan Document shall bear interest (whether before or after judgment),
payable on demand, at a rate per annum equal to the applicable Default Rate.
1.9 FEES.
(a) Commitment Fees. The Borrowers shall pay to the Administrative
Agent, for the account of each RC Lender, a commitment fee on the daily unused
amount of such RC Lender's RC Commitment for each day from and including the
Closing Date to but excluding the RC Maturity Date. The rate per annum shall
initially be equal to .50% of such unused amount but shall be adjusted five (5)
Business Days following delivery of the annual Officer's Compliance Certificate
for the year ending December 31, 1997 pursuant to Section 6.1 below and
thereafter shall be readjusted on the fifth (5th) Business Day following
delivery of such quarterly or annual Officer's Compliance Certificates. At any
time that such annual or quarterly Officer's Compliance Certificate to be
delivered pursuant to said Section 6.1 and is not so delivered, then the
Commitment Fee shall be based on the highest percentage set forth below in this
section 1.9(a). The adjustments in the rate shall be based on the Adjusted Total
Debt/Cash Flow Ratio as set forth in the chart below. The commitment fee shall
be payable in arrears (i) on successive Quarterly Payment Dates beginning with
the first Quarterly Payment Date after the Closing Date, (ii) on the date of any
reduction of the RC Commitment (to the extent accrued and unpaid on the amount
of such reduction) and (iii) on the RC Maturity Date.
Adjusted Total Commitment
Debt/Cash Flow Ratio Fee
-------------------- ----------
less than 3.5 .25%
greater than or equal
to 3.5 but less than 4.5 .3125%
greater than or equal
to 4.5 but less than 5.0 .375%
greater than or equal
to 5.0 .50%
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(b) Letter of Credit Fees. The Borrowers shall pay to the
Administrative Agent, for the respective accounts of the RC Lenders, a letter of
credit commission on the daily aggregate amount of the Contingent Reimbursement
Obligations under each Letter of Credit at a rate per annum equal to the
Applicable Margin that would be applicable to RC Loans that are LIBO Rate Loans
at such time. In addition, the Borrowers shall pay to the Administrative Agent,
for the sole account of the Issuer, a Letter of Credit fronting fee on the daily
aggregate amount of the Contingent Reimbursement Obligations under each Letter
of Credit at a rate per annum equal to .10%. Such fees shall be payable in
arrears on successive Quarterly Payment Dates and at the expiration or other
termination of each Letter of Credit. In addition, the Borrowers shall pay to
the Administrative Agent, for the benefit of the Issuer, the Issuer's standard
posted charges for such matters as opening, negotiation and transfer.
(c) Other Fees. The Borrowers shall pay to the Administrative Agent
for the respective accounts of the Administrative Agent, the Issuer, the Lenders
and/or the other Agents as the case may be, such other fees as have been or may
be agreed to in writing by the Borrowers or by Acquisition Corp. in connection
with the commitment to enter into this Agreement (including any facility fees
referred to in any commitment letters) and the transactions contemplated by this
Agreement.
1.10 COMPUTATION OF INTEREST AND FEES. Interest calculated on the basis of
the LIBO Rate or the Federal Funds Rate shall be computed on the basis of a year
of 360 days and paid for the actual number of days elapsed. Commitment fees,
letter of credit fees and interest calculated on the basis of the Prime Rate
shall be computed on the basis of a year of 365 or 366 days, as applicable, and
paid for the actual number of days elapsed. Interest, commitment fees and letter
of credit fees for any period shall be calculated from and including the first
day thereof to but excluding the last day thereof.
1.11 PROMISSORY NOTES; RECORDS OF ACCOUNT. Each Lender's Loans and the
Borrowers' joint and several obligations to repay such Loans with interest in
accordance with the terms of this Agreement shall be evidenced by this
Agreement, the Register and other records of the Administrative Agent and such
Lender and, in the case of Tranche A Term Loans, a single Tranche A Term Note
payable to the order of such Lender, in the case of RC Loans, a single RC Note
payable to the order of such Lender and, in the case of Swing Loans, a single
Swing Loan Note payable to the order of the Swing Loan Lender. The records of
each Lender shall be prima facie evidence of such Lender's Loans and, in each
case, of accrued interest thereon and all payments made in respect thereto. Each
Lender's participation in Letters of Credit shall be evidenced by this
Agreement, the records of such Lender and the Issuer and the Letters of Credit.
In the event that there is any dispute concerning the amount of any such
obligations, the amount of each Lender's Commitment with respect to RC Loans,
Tranche A Term Loans, Tranche B Term Loans and Tranche C Term Loans and the
amount of outstanding Loan Obligations of each and every Type shall at all times
be ascertained from the records of the Administrative Agent, including without
limitation, the Register, all of which shall be conclusive absent manifest error
except that the outstanding face amount of any Letters of Credit, the amount of
any unpaid Drawings, the amount of unpaid interest accrued thereon and fees
relating to Letters of Credit shall at all times be ascertained from the records
of the Issuer which shall be
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conclusive absent manifest error and the outstanding amount of any Swing Loans
and the amount of unpaid interest thereon shall at all times be ascertained from
the records of the Swing Loan Lender, which shall be conclusive absent manifest
error.
1.12 PRO RATA TREATMENT. Except to the extent otherwise provided herein,
(a) Tranche A Term Loans shall be made by, and principal, interest and fees in
respect thereof shall be paid or repaid to, the Tranche A Lenders pro rata in
accordance with their respective Tranche A Commitments and interest in Tranche A
Loans; (b) Tranche B Term Loans shall be made by, and principal, interest and
fees in respect thereof shall be paid or repaid to, the Tranche B Lenders pro
rata in accordance with their respective Tranche B Commitments and interest in
Tranche B Loans; (c) Tranche C Term Loans shall be made by, and principal,
interest and fees in respect thereof shall be paid or repaid to, the Tranche C
Lenders pro rata in accordance with their respective Tranche C Commitments and
interest in Tranche C Loans; and (d) RC Loans shall be made by, and principal,
interest and fees in respect thereof shall be paid or repaid to, the RC Lenders
pro rata in accordance with their respective RC Commitments and interest in RC
Loans. Each participation of obligations in respect to Letters of Credit and
Swing Loans shall be allocated among, and each reimbursement of Drawings under
Letters of Credit or letter of credit commissions shall be made for the account
of, the RC Lenders pro rata in accordance with their respective amounts of RC
Commitments.
1.13 TAXES ON PAYMENTS.
(a) Taxes Payable by the Borrowers. If any Tax is required to be
withheld or deducted from, or is otherwise payable by the Borrowers in
connection with, any payment due to the Administrative Agent, the Issuer or any
Lender that is not a "United States Person" (as such term is defined in Section
7701(a)(30) of the Code), the Borrowers (i) shall, if required, withhold or
deduct the amount of such Tax from such payment and, in any case, pay such Tax
to the appropriate taxing authority in accordance with applicable Law and (ii)
except in the case of any Bank Tax, shall pay the Issuer, to such Lender or the
Administrative Agent such additional amounts as may be necessary so that the net
amount received by such Person with respect to such payment, after withholding
or deducting all Taxes required to be withheld or deducted, is equal to the full
amount payable hereunder. If any Tax is withheld or deducted from, or is
otherwise payable by the Borrowers in connection with, any payment due to the
Issuer, any Lender or the Administrative Agent hereunder, the Borrowers shall
furnish to such Person the original or a certified copy of a receipt (if any)
for such Tax from the applicable taxing authority or other evidence of payment
thereof satisfactory to such Person within 30 days after the date of such
payment (or, if such receipt shall not have been made available by such taxing
authority within such time, the Borrowers shall use reasonable efforts to
promptly obtain and furnish such receipt). If the Borrowers fail to pay any such
Taxes when due to the appropriate taxing authority or fail to remit to the
Issuer, any Lender or the Administrative Agent the required receipts or other
evidence of payment thereof satisfactory to such Person, the Borrowers shall
indemnify such person for any Taxes, interest, penalties or additions to Tax
that may become payable by such Person as a result of any such failure.
(b) Taxes Payable by the Issuer, any Lender or the Administrative
Agent. The Borrowers shall, promptly upon request by the Issuer, any Lender or
the Administrative
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Agent that is not a United States Person, pay to such Person an amount equal to
(i) all Taxes (other than Bank Taxes and without duplication of amounts paid
pursuant to the preceding paragraph (a)) payable by such Person with respect to
any payment due to such Person hereunder and (ii) all Taxes (other than Bank
Taxes) payable by such Person as a result of payments made by the Borrowers
(whether made to a taxing authority or to such Person pursuant to the preceding
paragraph (a) or this paragraph (b)).
(c) Credits and Deductions. If the Issuer, any Lender or the
Administrative Agent is, in its sole opinion, able to apply for any refund,
offset, credit, deduction or other reduction in Taxes by reason of any payment
made by the Borrowers under the preceding paragraph (a) or (b), the Issuer, such
Lender or the Administrative Agent, as the case may be, shall use reasonable
efforts to obtain such refund, offset, credit, deduction or other reduction and,
upon receipt thereof, will pay to the Borrowers such amount, not exceeding the
increased amount paid by the Borrowers, as is equal to the net after-tax value
to the Issuer, such Lender or the Administrative Agent, in its sole opinion, of
such part of such refund, offset, credit, deduction or other reduction as it
considers to be allocable to such payment by the Borrowers, having regard to all
of such Person's dealings giving rise to similar refunds, offsets, credits,
deductions or other reductions in relation to the same tax period and to the
cost of obtaining the same; provided, however, that if such Person has made a
payment to the Borrowers pursuant to this paragraph (c) and the applicable
refund, offset, credit, deduction or other reduction in Tax is subsequently
disallowed, the Borrowers shall, promptly upon request by the Issuer, the
Administrative Agent or such Lender refund to such Person that portion of such
payment determined by such Person, in its sole opinion, relating to such
disallowance; and provided, further that (i) the Issuer, the Administrative
Agent or such Lender, as the case may be, shall not be obligated to disclose to
the Borrowers any information regarding its Tax affairs or computations and (ii)
nothing in this paragraph (c) shall interfere with the right of such Person to
arrange its Tax affairs as it deems appropriate.
(d) Exemption from U.S. Withholding Taxes. Each Lender that is not a
United States Person shall submit to the Borrowers and the Administrative Agent,
on or before the fifth day prior to the first Quarterly Payment Date occurring
after the Closing Date (or, in the case of a Person that is not a United States
Person and that became a Lender by assignment, promptly upon such assignment),
two duly completed and signed copies of either (A) Form 1001 of the United
States Internal Revenue Service entitling such Lender to a complete exemption
from withholding on all amounts to be received by such Lender pursuant to this
Agreement and the Loans, (B) Form 4224 of the United States Internal Revenue
Service relating to all amounts to be received by such Lender pursuant to this
Agreement and the Loans or (C) in the case of a Lender Party that is claiming an
exemption from United States withholding tax under Section 871(h) or 881(c) of
the Internal Revenue Code with respect to payments of "portfolio interest" two
accurate and complete signed original Forms W-8 (or any successor form
prescribed by the Internal Revenue Service, certifying that such Lender Party is
exempt from or is entitled to a reduced rate of United States withholding tax on
payments under this Agreement or the Notes) and, if such Lender Party delivers
such Forms W-8 (or successor form), two signed certificates that such Lender
Party is not (1) a "bank" for purposes of Section 881(c) of the Internal Revenue
Code, (2) is not a 10% shareholder (within the meaning of Section 871(h)(3)(B)
of the Internal Revenue Code) of the Borrower and (3) is not a controlled
foreign corporation related to the Borrower (within the meaning of Section
864(d)(4) of the Internal Revenue Code), as appropriate,
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Each such Lender shall, from time to time after submitting either such Form,
submit to the Borrowers and the Administrative Agent such additional duly
completed and signed copies of one or the other such Forms (or any successor
forms as shall be adopted from time to time by the relevant United States taxing
authorities) as may be (A) requested in writing by the Borrowers or the
Administrative Agent and (B) appropriate under the circumstances and under then
current United States law or regulations to avoid or reduce United States
withholding taxes on payments in respect of all amounts to be received by such
Lender pursuant to this Agreement or the Loans. Upon the request of the
Borrowers or the Administrative Agent, each Lender that is a United States
Person shall submit to the Borrowers and the Administrative Agent a certificate
to the effect that it is a United States Person.
(e) Obligations under this Section 1.13 shall survive payment of the
Loans.
1.14 REGISTERED NOTES AND LOANS.
(a) Request for Registration. Any Lender may request the Borrowers
(through the Administrative Agent), and the Borrowers agree thereupon, to
register such Loans as provided in Section 1.14(c) and, if such Lender is
otherwise entitled to a Note hereunder, to issue such Lender's Note, evidencing
such Loans, or to exchange such Note for a new Note, registered as provided in
Section 1.14(c) (a "Registered Note"). A Registered Note may not be exchanged
for a Note that is not in registered form. A Registered Note shall be deemed to
be and shall be a Note for all purposes of this Agreement and the other Loan
Documents.
(b) Delivery of Tax Forms. Each Non-U.S. Lender that requests or
holds a Registered Note pursuant to Section 1.14(a) or registers its Loans
pursuant to Section 1.14(a) (a "Registered Lender") (or, if such Registered
Lender is not the beneficial owner thereof, such beneficial owner) shall deliver
to Multicare (on behalf of the Borrowers) (with a copy to the Administrative
Agent) prior to or at the time such Non-U.S. Lender becomes a Registered Lender,
the applicable form described in Section 1.13(d) (or such successor and related
forms as may from time to time be adopted by the relevant taxing authorities of
the United States) together with an annual certificate stating that such
Registered Lender or beneficial owner, as the case may be, is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code and is not otherwise
described in Section 881(c)(3) of the Code. Each Registered Lender or beneficial
owner, as the case may be, shall promptly notify Multicare (on behalf of the
Borrowers) (with a copy to the Administrative Agent) if at any time such
Registered Lender or beneficial owner, as the case may be, determines that it is
no longer in a position to provide such previously delivered certificate to the
Borrowers (or any other form of certification adopted by the relevant taxing
authorities of the United States for such purposes).
(c) Registration of Loans. The Administrative Agent, acting, for
this purpose, as agent of the Borrowers, shall, upon request of any Registered
Lender, enter in the Register the name, address and taxpayer identification
number (if provided) of the Registered Lender or beneficial owner, as the case
may be. In addition to the requirements of Section 12.9 (Successors and
Assigns), a Registered Note and the Loans evidenced thereby (or such Loans
pending delivery of such Registered Note) or any other Loans registered pursuant
to Section 1.14(a) above may be assigned or otherwise transferred in
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whole or in part only by registration of such assignment or transfer of such
Registered Note and/or the Loans so registered on the Register (and each such
Registered Note shall expressly so provide). Any assignment or transfer of all
or part of such Loans and such Registered Note shall be registered on the
Register only upon compliance with the provisions of Section 12.9 and, in the
case of Registered Notes, surrender for registration of assignment or transfer
of the Registered Note evidencing such Loans, duly endorsed by (or accompanied
by a written instrument of assignment or transfer fully executed by) the
Registered Lender thereof, and thereupon one or more new Registered Notes in the
same aggregate principal amount shall be issued to the designated assignee(s) or
transferee(s) and, if less than all of such Registered Notes is thereby being
assigned or transferred, the assignor or transferor.
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ARTICLE 2
YIELD PROTECTION AND BREAKAGE INDEMNITY
2.1 MANDATORY SUSPENSION AND CONVERSION OF LIBO RATE LOANS. Any Lender's
obligations to make, continue or convert into LIBO Rate Loans of any Type shall
be suspended, all such Lender's outstanding Loans of such Type shall be
converted into Prime Rate Loans on the last day of their applicable Interest
Periods (or, in the case of clause (c) below, on the last day such Lender may
lawfully continue to maintain Loans of such Type if earlier, or, in the case of
clause (d) below, on the day determined by such Lender to be the last Business
Day before the effective date of the applicable restriction), and all pending
requests for the making or continuation of or conversion into Loans of such Type
by such Lender shall be deemed requests for Prime Rate Loans, if:
(a) on or prior to the date required for the determination of a LIBO
Rate for any Interest Period, the Administrative Agent determines that for any
reason appropriate information is not available to it for purposes of
determining the LIBO Rate for such Interest Period;
(b) on or prior to the first day of any Interest Period for a LIBO
Rate Loan, the Required Lenders have informed the Administrative Agent of their
determination that the LIBO Rate as determined by the Administrative Agent for
such Interest Period would not accurately reflect the cost to such Lenders of
making, continuing or converting into a LIBO Rate Loan for such Interest Period;
(c) at any time such Lender determines that any Regulatory Change
makes it unlawful or impracticable for such Lender or its applicable Eurodollar
Lending Office to make, continue or convert into a LIBO Rate Loan of such Type,
or to comply with its obligations hereunder in respect thereof; or
(d) such Lender notifies the Administrative Agent of its
determination that (i) by reason of any Regulatory Change, such Lender or its
applicable Eurodollar Lending Office is restricted, directly or indirectly, in
the amount that it may hold of (A) a category of liabilities that includes
deposits by reference to which, or on the basis of which, the interest rate
applicable to LIBO Rate Loans of such Type is directly or indirectly determined
or (B) the category of assets that includes LIBO Rate Loans of such Type and
(ii) in connection therewith, such Lender has elected not to make available
hereunder LIBO Rate Loans of such Type.
If, as a result of this Section 2.1, any Loan of any Lender that would otherwise
be made or maintained as or converted into a LIBO Rate Loan for any Interest
Period is instead made or maintained as or converted into a Prime Rate Loan,
then, unless the corresponding Loan of each of the other Lenders is also to be
made or maintained as or converted into a Prime Rate Loan, such Loan shall be
treated as being a LIBO Rate Loan of such Type for such Interest Period for all
purposes of this Agreement (including the timing, application and proration
among the Lenders of interest payments, conversions and prepayments) except for
the calculation of the interest rate borne by such Loan. The Administrative
Agent shall promptly notify Multicare (on behalf of the Borrowers) and each
Lender of the existence or occurrence
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of any condition or circumstance specified in clause (a) or (b) above, and each
Lender shall promptly notify Multicare (on behalf of the Borrowers) and the
Administrative Agent of the existence, occurrence or termination of any
condition or circumstance specified in clause (c) or (d) above applicable to
such Lender's Loans, but the failure by the Administrative Agent or such Lender
to give any such notice shall not affect such Lender's rights hereunder.
2.2 REGULATORY CHANGES. If in the determination of any Lender or, in the
case of any Letter of Credit or Drawing, the Issuer, (a) any Regulatory Change
shall directly or indirectly
(i) reduce the amount of any sum received or receivable by (A)
such Lender with respect to any LIBO Rate Loan or Letter of Credit
Participation or the return to be earned by such Lender on any LIBO Rate
Loan or Letter of Credit Participation, or (B) the Issuer with respect to
any Letter of Credit or Drawing,
(ii) impose a cost on (A) such Lender or any Affiliate of such
Lender that is attributable to the making or maintaining of, or such
Lender's commitment to make or acquire, any LIBO Rate Loan, or Letter of
Credit Participation or (B) the Issuer or any of its Affiliates that is
attributable to the issuance or maintaining of, or the commitment to
issue, any Letter of Credit or the making or maintaining of any Drawing,
(iii) require (A) such Lender or any Affiliate of such Lender
to make any payment on or calculated by reference to any amount received
by such Lender in respect of its LIBO Rate Loans or its obligations to
make LIBO Rate Loans or (B) the Issuer or any of its Affiliates to make
any payment on or calculated by reference to any amount received by the
Issuer or any of its Affiliates in respect of any Letter of Credit, or its
commitment to issue any Letter of Credit or Drawing, or
(iv) reduce, or have the effect of reducing, the rate of
return on any capital (A) such Lender or any Affiliate of such Lender is
required to maintain on account of any LIBO Rate Loan or Letter of Credit
Participation or such Lender's commitment to make any LIBO Rate Loan or
Letter of Credit Participation, or (B) the Issuer or of any of its
Affiliates is required to maintain on account of any Letter of Credit or
Drawing or the Issuer's commitment to issue any Letter of Credit.
and (b) such reduction, increased cost or payment shall not be fully compensated
for by an adjustment in the applicable rates of interest payable under the Loan
Documents, then the Borrowers shall pay to such Lender or the Issuer such
additional amounts as such Lender or the Issuer determines will fully compensate
it for such reduction, increased cost or payment. Such additional amounts shall
be payable, in the case of those applicable to prior periods, within 15 Business
Days after request for such payment by such Lender or the Issuer, as the case
may be, accompanied by the certificate described in Section 2.5 and, in the case
of those applicable to future periods, on the dates specified, or determined in
accordance with a method specified, by such Lender or the Issuer, as the case
may be, provided that the Borrowers shall not be liable for any amount payable
with respect to any period more than 90 days before the date of such request or
certificate, or, if earlier the retroactive effective date of the Regulatory
Change if such Regulatory Change occurs during such 90-day period.
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2.3 CAPITAL AND RESERVE REQUIREMENTS. If, in the determination of any
Lender, or the Issuer, such Lender, the Issuer or any Affiliate thereof is
required, under applicable Law (including Regulation D), or interpretations,
directives, requests and governmental or regulatory guidelines (whether or not
having the force of law), to maintain capital or deposit any reserve on account
of any Loan, any Letter of Credit (whether drawn or undrawn) or any commitment
to make any Loan or issue any Letter of Credit, then, upon request by such
Lender or the Issuer, the Borrowers shall pay to such Lender or the Issuer, as
the case may be, such additional amounts as such Person determines will fully
compensate it for any reduction in the rate of return on the capital that such
Lender, the Issuer or such Affiliate thereof is so required to maintain. Such
additional amounts shall be payable, in the case of those applicable to prior
periods, within 15 Business Days after request by such Lender or the Issuer, as
the case may be, for such payment accompanied by the certificate described in
Section 2.5 (provided that the Borrowers shall not be liable for any amount
payable with respect to any period more than 90 days before the date of such
request or certificate, or, if earlier, the retroactive effective date of such
determination if made during such 90-day period), and, in the case of those
relating to future periods, on the dates specified, or determined in accordance
with a method specified, by such Lender or the Issuer, as the case may be.
2.4 BREAKAGE. The Borrowers shall pay to each Lender, upon request, such
amount as such Lender reasonably determines is necessary to compensate it for
any loss, cost or expense (excluding loss of the Applicable Margin) incurred by
it as a result of (a) any payment, prepayment or conversion of a LIBO Rate Loan
on a date other than the last day of an Interest Period for such LIBO Rate Loan
or (b) a LIBO Rate Loan for any reason not being made or converted, or any
payment of principal thereof or interest thereon not being made, on the date
therefor determined in accordance with the applicable provisions of this
Agreement. At the election of such Lender, and without limiting the generality
of the foregoing, but without duplication, such compensation on account of
losses may include an amount equal to the excess of (i) the interest that would
have been received from the Borrowers under this Agreement (excluding the
Applicable Margin) during the remainder of the applicable Interest Period over
(ii) the interest component of the return that such Lender determines it could
have obtained had it placed such amount on deposit in the interbank Dollar
market for a period equal to such remaining portion of the Interest Period.
2.5 DETERMINATIONS. In making the determinations contemplated by this
Article 2, each Lender and the Issuer shall make such estimates, assumptions,
allocations and the like that such Person in good faith determines to be
appropriate, and such Person's selection thereof in accordance with this Section
2.5, and the determinations made by such Person on the basis thereof, shall be
final, binding and conclusive upon the Borrowers, except, in the case of such
determinations, for manifest errors. Each Lender and the Issuer shall furnish to
the Borrowers, at the time of any request for compensation under Section 2.2 or
2.3, a certificate outlining in reasonable detail the computation of any amounts
claimed by it under this Article 2 and the assumptions underlying such
computations, which shall include a statement of an officer of such Person
certifying that such request for compensation is being made pursuant to a policy
adopted by such Person to seek such compensation generally from customers
similar to the Borrowers and having similar provisions in agreements with
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such Person.
2.6 REPLACEMENT OF LENDERS. If any Lender requests compensation pursuant
to Sections 1.13 (Taxes on Payments), 2.2 (Regulatory Changes) or 2.3 (Capital
and Reserve Requirements), or such Lender's obligation to make or continue Loans
as LIBO Rate Loans shall be suspended pursuant to Section 2.1 (Mandatory
Suspension and Conversion of LIBO Rate Loans) or such Lender has defaulted on
its obligations to make or participate in Loans pursuant to Section 1.3 (Manner
of Borrowing), Multicare (on behalf of the Borrowers), upon three Business Days'
notice, may require that such Lender transfer all of its right, title and
interest under this Agreement, such Lender's Notes, if any, and the other Loan
Documents to any Eligible Institution identified by Multicare (on behalf of the
Borrowers) subject to
(a) the consent of the Administrative Agent (which consent shall not
be unreasonably withheld),
(b) satisfaction of the other conditions specified in Section 12.9
below (Successors and Assigns),
(c) the agreement of the proposed transferee to assume all of the
obligations of such Lender hereunder and under the other Loan Documents for
consideration equal to the outstanding principal amount of such Lender's Loans,
unreimbursed Drawings payable to the transferor, interest thereon to the date of
such transfer, and all other amounts payable hereunder to such Lender to the
date of transfer,
(d) such transferor Lender shall have been paid on or prior to the
date of such transfer all fees and other amounts payable to such transferor
hereunder including those amounts payable under said Sections 1.13, 2.2 or 2.3,
as applicable (and including any fees accrued hereunder and any amounts that
would be payable under Section 2.4 (Breakage) as if all of such Lender's Loans
and share of unreimbursed Drawings were being prepaid in full on such date) or
arrangements satisfactory to the transferor Lender shall have been made for such
payments, and
(e) satisfaction of the condition that if the Lender being replaced
has requested compensation pursuant to Sections 1.13, 2.2 or 2.3, the proposed
transferee's aggregate requested compensation, if any, pursuant to Sections
1.13, 2.2 or 2.3 with respect to such replaced Lender's Loans is lower than that
of the Lender replaced.
Without prejudice to the survival of any other agreement of the Borrowers
hereunder, the agreements of the Borrowers contained in Sections 1.13 (Taxes on
Payments), 2.2 (Regulatory Changes), 2.3 (Capital and Reserve Requirements), 2.4
(Breakage), 12.12 (Indemnification) and 12.13 (Expenses) (without duplication of
any payments made to such Lender by the Borrowers or the proposed transferee)
shall survive for the benefit of any Lender replaced under this Section 2.6 with
respect to the time prior to such replacement.
2.7 CHANGE OF LENDING OFFICE. Each Lender agrees that, upon the occurrence
of any event giving rise to the operation of Sections 1.13 (Taxes on Payments),
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2.1 (Mandatory Suspension and Conversion of LIBO Rate Loans), 2.2 (Regulatory
Changes) or 2.3 (Capital and Reserve Requirements) with respect to such Lender,
it will, if requested by the Borrowers, use reasonable efforts (subject to
overall policy considerations of such Lender) to designate another lending
office for any Loans affected by such event, provided that such designation is
made on such terms that such Lender and its lending office suffer no material
economic, legal or regulatory disadvantage, with the object of avoiding the
consequence of the event giving rise to the operation of any such Section.
Nothing in this Section 2.7 shall affect or postpone any of the obligations of
the Borrowers or the right of any Lender provided in Section 1.13 (Taxes on
Payments), 2.1 (Mandatory Suspension and Conversion of LIBO Rate Loans), 2.2
(Regulatory Changes) or 2.3 (Capital and Reserve Requirements).
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ARTICLE 3
LETTERS OF CREDIT
3.1 ISSUANCE OF LETTERS OF CREDIT.
(a) In General. Upon the terms and subject to the conditions of this
Agreement, the Issuer shall, from time to time, from the Closing Date to the
date which is 90 days prior to the RC Maturity Date, issue one or more Letters
of Credit for the account of any Borrower, provided that (i) the sum of the
Contingent Reimbursement Obligations (after giving effect to the requested
Letter of Credit) plus the aggregate unpaid amount of all Drawings under Letters
of Credit shall not exceed $15,000,000.00 and provided, further, that the face
amount of the Letter of Credit so requested shall not exceed the Available RC
Commitment at such time. Each Letter of Credit shall be in a form and shall
contain such terms as shall be reasonably satisfactory to the Issuer. Letters of
Credit shall be issued only on a Business Day, and shall be used for the general
corporate purposes of the Borrowers or for such other purposes as shall be
acceptable to the Issuer in its sole discretion.
(b) Terms. Each Letter of Credit shall be denominated only in
Dollars and shall expire on or before the first anniversary of the issuance
thereof and in any event not later than the fifth Business Day preceding the RC
Maturity Date. No Letter of Credit shall have an expiration date which is
extendable under an "evergreen" or similar provision unless the Issuer expressly
agrees to the same in its sole discretion in any particular case. All other
extensions and renewals are also at the sole discretion of the Issuer. Any
extension of the expiry date of a Letter of Credit to a date beyond the first
anniversary of the issuance thereof shall constitute an "issuance" of such
Letter of Credit for all purposes hereof.
(c) Form of Request. The Borrowers shall request the issuance of a
Letter of Credit by furnishing to the Administrative Agent and the Issuer, at
least five Business Days before the requested date of such issuance (or at such
later time as shall be acceptable to the Issuer), such notice thereof as shall
be reasonably satisfactory to the Issuer to which shall be attached a
certificate of the chief financial officer or other Responsible Officer of
Multicare representing that Multicare is, and after giving effect to the
additional Indebtedness will be, in compliance with Section 4.03 of the 1997
Subordinated Note Indenture, that the obligations with respect to such Letter of
Credit constitute "Senior Indebtedness" and "Designated Senior Indebtedness" as
defined in the 1997 Subordinated Note Indenture, and as to such other matters as
required by Section 4.2 below.
(d) Participation by RC Lenders. Upon the date of issuance of a
Letter of Credit, the Issuer shall be deemed to have granted to each RC Lender
(other than the Issuer), and each RC Lender (other than the Issuer) shall be
deemed to have acquired from the Issuer without further action by any party
hereto, a participation in such Letter of Credit and any Drawings that may at
any time be made thereunder, to the extent of such Lender's pro rata share of
the RC Commitment.
(e) Notice of Drawings. The Issuer shall promptly notify Multicare
(on behalf of the Borrowers) of its receipt of each Drawing request with respect
to a Letter of Credit, stating the date and amount of the Drawing requested
thereby and the date and
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amount of each Drawing disbursed pursuant to such request. The failure of the
Issuer to give, or delay in giving, any such notice shall not release or
diminish the obligations hereunder of the Borrowers in respect of such Drawing.
(f) Reimbursement of Drawings by Borrowers. If at any time Multicare
(on the behalf of the Borrowers) receives notice of a Drawing, the Borrowers
shall reimburse such Drawing by paying to the Issuer in immediately available
funds the amount of the payment made by the Issuer with respect to such Drawing,
together with interest thereon at a rate per annum equal to the Prime Rate from
the day that the Drawing is made until the day such reimbursement is made if
such Drawing is not reimbursed on the day the Drawing is made. Such
reimbursement shall be made by the Borrowers to the Issuer no later than one (1)
Business Day following the date that Multicare (on behalf of Borrowers) receives
the relevant notice of Drawing if such notice is received on or prior to 10:00
a.m. (Philadelphia, Pennsylvania time) and no later than two (2) Business Days
following the date that Multicare receives the relevant notice of Drawing if
such notice is received after 10:00 a.m. (Philadelphia, Pennsylvania time). If
the Borrowers shall fail to make any payment required by this paragraph (f) at
the time specified, and if at such time, there shall be any Available RC
Commitment, the Administrative Agent may (but is not obligated to) assume that
the Borrowers intend to use the proceeds of RC Loans to make such payment. In
reliance on such assumption, the Administrative Agent may (but is not obligated
to) notify the RC Lenders (and Multicare (on behalf of the Borrowers)) that
notwithstanding the Borrowers' failure to provide notice pursuant to Section 1.3
above, such notice is deemed given pursuant to this paragraph (f) requesting an
RC Loan bearing interest at the Prime Rate in an amount sufficient to make the
payments required by this paragraph (f). Such notice from the Administrative
Agent shall be treated by the Lenders in the same manner as a notice from the
Borrowers under Section 1.3 above. The Administrative Agent may, at the
direction of the Issuer, apply the proceeds of such Loans to satisfy the
requirements of this paragraph (f).
(g) Obligations of RC Lenders to Issuer. In the event that the
Borrowers shall fail to make any payment when due pursuant to the preceding
paragraph (f) and for so long as such failure shall be continuing, the Issuer
may give notice of such failure to the Administrative Agent and each RC Lender,
which notice shall include, in the case of an RC Lender, the amount of such RC
Lender's interest in such Drawing, whereupon each such RC Lender (other than the
Issuer) shall promptly remit such amount to the Administrative Agent for the
account of the Issuer as provided in this paragraph (g). Each RC Lender (other
than the Issuer) shall, in the event it receives such notice from the Issuer at
or before 12:00 noon (Philadelphia, Pennsylvania time) on any Business Day, fund
its participation in any unreimbursed Drawing by remitting to the Administrative
Agent, no later than 2:00 p.m. (Philadelphia, Pennsylvania time) on such day, in
immediately available funds its share of the reimbursement obligations in
respect of each Drawing. In the event that the Administrative Agent receives
such funds from an RC Lender at or before 2:00 p.m. (Philadelphia, Pennsylvania
time) on any day, the Administrative Agent shall make available the amount
thereof to the Issuer, in immediately available funds no later than 4:00 p.m.
(Philadelphia, Pennsylvania time) on that same day. Any amount payable by an RC
Lender to the Administrative Agent for the account of the Issuer under this
paragraph (g), and any amount payable by the Administrative Agent to the Issuer
under this paragraph (g), shall bear interest for each day from the date due
(and including such day if paid after 2:00 p.m. (Philadelphia, Pennsylvania
time) in the case of any such payment by an RC Lender to the Administrative
Agent, or 4:00 p.m. (Philadelphia, Pennsylvania time), in the case of any such
payment by
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the Administrative Agent to the Issuer, on such day) until the date it is
received by the Issuer at a rate equal to the Federal Funds Rate until (and
including) the third Business Day after the date due and thereafter at the Prime
Rate. Moreover, any Lender that shall have failed to make available the required
amount shall not be entitled to vote on such matters as Lenders or Required
Lender are otherwise entitled to vote on or consent to or approve under this
Agreement and the other Loan Documents until such amount with interest is paid
in full to the Administrative Agent by such Lender. Each RC Lender shall, upon
the demand of the Issuer, reimburse the Issuer, through the Administrative Agent
to the extent that the Issuer has not been reimbursed by the Borrowers after
demand therefor, for the reasonable costs and expenses (including reasonable
legal fees) incurred by it (other than as a result of its willful misconduct or
gross negligence as finally determined by a court of competent jurisdiction) in
connection with the collection of amounts due under, the administration of, and
the preservation and enforcement of any rights conferred by, the Letters of
Credit or the performance of the Issuer's obligations under this Agreement in
respect thereof on a pro rata basis relative to such RC Lender's pro rata share
of the RC Commitment (as of the time such costs and expenses are incurred). The
Issuer shall refund through the Administrative Agent any costs and expenses
reimbursed by such RC Lender that are subsequently recovered from the Borrowers
in an amount equal to such RC Lender's ratable share thereof.
(h) Cash Collateral. It is intended that at all times that the
Borrowers shall have contingent or other obligations (including obligations in
respect of fees) relating to Letters of Credit, there shall be sufficient
availability under the RC Commitment to reimburse the Issuer (and the RC
Lenders) out of proceeds of RC Loans. Accordingly, in the event that there
shall, at any time, be insufficient availability under the RC Commitment (after
giving effect to all outstanding Swing Loans and RC Loans) to do so (whether
because the amount of the RC Commitment is reduced pursuant to a mandatory
reduction or is terminated at maturity, upon acceleration or otherwise or
because the amount of outstanding RC Loans, Swing Loans and such Letter of
Credit obligations exceeds the amount of the RC Commitment for any other
reason), the Borrowers shall forthwith pay to the Administrative Agent an amount
equal to the aggregate face value of all outstanding Letters of Credit plus the
aggregate amount of all unreimbursed Drawings plus the amount of all fees or
other obligations in respect of Letters of Credit to the extent of such excess.
Such amount shall be maintained by the Administrative Agent in an
interest-bearing cash collateral account in the name of and for the benefit of
the Issuer and the RC Lenders to secure such payment obligations of the
Borrowers until such time as all outstanding Letters of Credit have expired or
been cancelled and all amounts in respect thereof have been paid in full. Upon
receipt of a notice from the Issuer that there are unreimbursed Drawings or
other amounts due in respect of such Letters of Credit (which notice shall set
forth the amount of such unreimbursed Drawings or other obligations) the
Administrative Agent shall promptly disburse from the cash collateral account
the amount specified in the notice and shall pay such amount to the Issuer and
RC Lenders ratably in accordance with the respective amounts owing to each such
Person, first, for fees and indemnities until the same are paid in full and,
second, for unreimbursed Drawings. The Administrative Agent and the Issuer may
rely on their records as to any amounts so owing and shall be fully protected in
doing so. Such records shall be conclusive, absent manifest error. At any time
that the RC Commitment again becomes available for reimbursement of Drawings
under outstanding Letters of Credit such that (i) the sum of the RC Commitment
at that time and the amount in the cash collateral account exceeds (ii) the sum
of all outstanding RC Loans and Swing Loans, the face amount of all outstanding
Letters of Credit and the amount of all unreimbursed
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Drawings, then, upon written request of Multicare (on behalf of the Borrowers)
(which request shall (A) represent that there exists no Default or Event of
Default and (B) specify the amount of such excess), the Administrative Agent
shall release such excess amount to the Borrowers from the cash collateral
account. If all Loan Obligations (other than Loan Obligations constituting
contingent obligations under indemnification provisions which survive
indefinitely, so long as no unsatisfied claim has been made under any such
indemnification provision) have been indefeasibly paid in full in cash, all
Commitments have terminated and all Letters of Credit have expired, promptly
following demand by Multicare (on behalf of the Borrowers) the Administrative
Agent shall release to the Borrowers all remaining funds in the Letter of Credit
cash collateral account.
(i) Obligations Absolute. The obligation of each Borrower and each
RC Lender to make available to the Issuer the amounts set forth in this Article
3 shall be absolute, unconditional and irrevocable under any and all
circumstances without reduction for any set-off or counterclaim of any nature
whatsoever, and may not be terminated, suspended or delayed for any reason
whatsoever, shall not be subject to any qualification or exception and shall be
made in accordance with the terms and conditions of this Agreement under all
circumstances, including any of the following circumstances:
(i) any lack of validity or enforceability of this Agreement
or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or other
right which any Borrower may have at any time against a beneficiary named
in a Letter of Credit, any transferee of any Letter of Credit (or any
Person for whom any such transferee may be acting), the Administrative
Agent, the Issuer, any RC Lender or any other Person, whether in
connection with this Agreement, any Letter of Credit, the transactions
contemplated herein or any unrelated transactions (including any
underlying transaction between such Borrower and the beneficiary named in
any such Letter of Credit);
(iii) any draft, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Loan
Documents; or
(v) the occurrence of any Default or Event of Default.
(j) Limitations on Liability; Protection of Issuer, Administrative
Agent and Lenders.
(i) Limitation on Liability of Lender Parties. Without
affecting any rights any Lender Party may have under applicable Law, each of the
Borrowers agrees that none of the RC Lenders, the Issuer, the Administrative
Agent or their respective officers or directors shall be liable or responsible
for, and the obligations of the Borrowers to the RC Lenders, the Issuer and the
Administrative Agent hereunder shall not in any manner be affected by: (A) the
use that may be made of any Letter of Credit or the proceeds thereof by
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the beneficiary thereof or any other Person or any acts or omissions of such
beneficiary or any other Person; (B) the validity, sufficiency or genuineness of
documents presented in connection with any Drawing, or of any endorsements
thereon, even if such documents should, in fact, prove to be in any or all
respects, invalid, insufficient, fraudulent or forged; or (C) any other
circumstances whatsoever in making or failing to make payment under any Letter
of Credit or any other action taken or omitted to be taken by any Person under
or in connection with any Letter of Credit, except that the Borrowers shall have
a claim against the Issuer and the Issuer shall be liable to the Borrowers, in
each case to the extent and only to the extent of any damages suffered by the
Borrowers that they prove are caused by the Issuer's willful misconduct or gross
negligence. In furtherance and not in limitation of the foregoing, in
determining whether to pay under any Letter of Credit, the Issuer shall not have
any obligation relative to the other Lenders other than to determine that any
documents required to be delivered under such Letter of Credit appear to have
been delivered and that they appear to comply on their face with the
requirements of such Letter of Credit, regardless of any notice or information
to the contrary. Any action taken or omitted to be taken by the Issuer under or
in connection with any Letter of Credit (if taken or omitted in the absence of
gross negligence or willful misconduct, as finally determined by a court of
competent jurisdiction) shall not create for the Issuer any resulting liability
to any Borrower or any Lender.
(ii) Indemnification and Expenses. In addition to any other
amounts payable under this Agreement, the Borrowers agree jointly and severally
to protect, indemnify, pay and hold the Issuer and each RC Lender harmless from
and against any and all claims, costs, charges and expenses (including
reasonable attorneys' fees) which the Issuer may incur or be subject to as a
consequence, direct or indirect, of (A) the issuance of, or payment of any
drawing under, any Letter of Credit, other than as a result of the gross
negligence or willful misconduct of the Issuer as finally determined by a court
of competent jurisdiction or (B) the failure of the Issuer to honor a Drawing
under any Letter of Credit as a result of any act or omission of any present or
future government or Governmental Authority.
(iii) Issuer Not Responsible. In furtherance of the foregoing
limitations on liability, the Issuer shall not be responsible for: (A) the form,
validity, sufficiency, accuracy, genuineness or legal effect of any document
submitted by any party in connection with the issuance of Letters of Credit; (B)
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof in whole or in part; (C) errors, omissions,
interruptions, or delays in transmissions or delivery of any messages, by mail,
cable, telecopy, telex or otherwise, whether or not in cipher, except for
damages proven to be caused by the Issuer's gross negligence or willful
misconduct; (D) the misapplication by the beneficiary of any Letter of Credit or
the proceeds of any drawing under such Letter of Credit; or (E) any consequence
arising from causes beyond the control of the Issuer, including any governmental
acts.
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ARTICLE 4
CONDITIONS TO EFFECTIVENESS OF AGREEMENT
AND FUNDINGS
4.1 CONDITIONS TO EFFECTIVENESS OF AGREEMENT AND INITIAL FUNDING. The
effectiveness of this Agreement, the obligation of the Lenders to make the
initial Loans hereunder and the obligation of the Issuer to issue Letters of
Credit hereunder are subject to the fulfillment of the following conditions on
or before that date which is 120 days after the closing with respect to the
Tender Offer (unless such date is extended in writing by the Agents in their
sole discretion), in each case to the satisfaction of the Agents and, to the
extent specified below, to the satisfaction of each Lender (each Lender upon
making its initial Loan hereunder being deemed to have waived or found
satisfactory all such conditions so specified).
(a) Secretary's Certificates. The Borrowers shall have delivered, or
caused to be delivered, a certificate of the Secretary or an Assistant Secretary
(or general partner, as applicable) of each of the Borrowers and Surety, with
specimen signatures of the authorized signatories to the Loan Documents, and to
which shall be attached copies of the following, as applicable: articles or
certificate of incorporation (each of which shall be certified as of a recent
date by the Secretary of State of the state of such Borrower's or Surety's
incorporation), certificates of formation (each of which shall be certified as
of a recent date by the Secretary of State of the state of such Borrower's or
Surety's formation), operating agreements, management agreements, bylaws,
partnership agreements, resolutions and shareholder agreements.
(b) Good Standing Certificates. The Borrowers shall have delivered,
or caused to be delivered, a good standing or subsistence certificate, as the
case may be, issued as of a recent date with respect to each Borrower (and each
corporate, limited liability company or limited partnership, general partner of
Borrowers that are partnerships) and Surety, (i) issued by the Secretary of
State or other appropriate official of the jurisdiction of formation of such
Person and (ii) issued by the Secretary of State or other appropriate official
of each jurisdiction where it is required to qualify to do business and, if any
such certificate is dated more than twenty-one (21) days prior to the Closing
Date, a confirmation (which may be provided by a reputable corporate service) of
the information in such certificate.
(c) The Notes. The Borrowers shall have delivered to the
Administrative Agent for distribution to each of the RC Lenders, the Tranche A
Lenders and the Swing Loan Lender the applicable Notes referred to in Section
1.11.
(d) Lien Searches. The Borrowers shall have delivered to the
Administrative Agent Uniform Commercial Code, tax, and judgment lien searches of
the Borrowers and Surety, in such form, as of such date and with such content as
are acceptable to the Administrative Agent.
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(e) Pledge Agreement. The Borrowers and GENESIS ELDERCARE CORP. (the
"Surety") shall each have executed and delivered Pledge Agreements whereby the
Administrative Agent shall receive a first priority security interest for the
benefit of the Lender Parties in all of the equity interests in each of the
direct and indirect Restricted Subsidiaries of Multicare, the stock of Multicare
and all inter-Borrower notes (collectively, as such agreements are amended,
modified, restated or supplemented from time to time in accordance with the
terms hereof and thereof, the "Pledge Agreement") in substantially the form
annexed to this Agreement as Exhibit E (together with the stock certificates,
assignment powers, Uniform Commercial Code financing statements (in proper form
for filing in the appropriate offices to perfect the security interest of the
Administrative Agent, for the benefit of the Secured Parties, in the Collateral
granted under the Pledge Agreement) and other items required thereunder to the
extent that such items were not previously delivered to the Administrative
Agent).
(f) Guaranty. The Borrowers shall have caused to be delivered to the
Administrative Agent for the benefit of the Lender Parties a Guaranty and
Suretyship Agreement in substantially the form annexed hereto as Exhibit F (the
"Suretyship Agreement") duly executed by the Surety, whereby the Surety
guarantees and becomes surety for all of the Borrowers' obligations hereunder
and under the other Loan Documents.
(g) Multicare Management Agreement. Prior to or substantially
contemporaneously with the initial funding hereunder, GENESIS HEALTH VENTURES,
INC. ("Genesis") (and/or one or more of its Subsidiaries) shall have entered
into a Management Agreement with the Surety (the "Multicare Management
Agreement") under which Genesis (and/or such Subsidiaries) will provide
management services to the Borrowers (or Surety). The Multicare Management
Agreement shall be on terms and conditions satisfactory to the Agents. As a
further condition, Genesis, Multicare and the Agents shall enter into the
Multicare Management Subordination Agreement.
(h) Other Transaction Documents; Tender Offer. (i) The Borrowers
shall have delivered to each of the Agents and any Lender that so requests, each
of the other Transaction Documents certified by a Responsible Officer of
Multicare as being a true and correct copy of such Transaction Document as in
full force and effect on the Closing Date. (ii) The Tender Offer shall have
closed with the purchase of at least a majority of the common stock of Multicare
having been purchased for $28 per share and the other transactions contemplated
by the Transaction Documents to have occurred on or before the Closing Date
shall have taken place in strict compliance with the terms of said Transaction
Documents, subject only to such modifications as are acceptable to the Agents.
There shall be no legal impediment to the merger of Acquisition Corp. into
Multicare under Section 253 or 251, as the case may be, of the Delaware General
Corporation Law on the terms set forth in the Merger Agreement and the
restrictions in Section 203 of the Delaware General Corporation Law and any
other impediment under Delaware law shall be inapplicable to the acquisition of
the shares of Multicare by Acquisition Corp. and the proposed merger pursuant to
the terms of the Merger Agreement.
(i) Acquisition and Merger. The Borrowers shall have provided the
Agents with evidence that simultaneously with the closing hereunder, Acquisition
Corp. will merge with Multicare, with Multicare being the surviving entity in
accordance with the terms of the Merger Agreement and in compliance with all
applicable Laws, and that
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simultaneously with the closing hereunder, Surety will own 100% of the capital
stock of such surviving entity.
(j) Opinions of Counsel. (i) The Borrowers shall have delivered
favorable opinions of counsel, dated as of the Closing Date, from:
(1) Blank, Rome, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Borrowers,
as to the absence of conflicts with other financing agreements and other
material agreements of the Borrowers, the status of the Loan Obligations as
"Senior Indebtedness" and "Designated Senior Indebtedness" within the meaning of
the 1997 Subordinated Note Indenture, and compliance with Regulations G, T, U
and X of the Board of Governors of the Federal Reserve System, the perfection of
security interests under the Pledge Agreement, issuance of capital stock of the
Borrowers, the due organization of the Borrowers and Surety, the due
authorization of the transactions referred to herein, the enforceability of the
Loan Documents, and such other matters as the Agents may reasonably request, in
form and substance satisfactory to the Agents; and
(2) Local counsel to the Borrowers in the States of
Massachusetts, West Virginia, New Jersey, Ohio, Pennsylvania, Wisconsin,
Connecticut, Illinois, Rhode Island, Vermont and Virginia as to certain health
care matters and such other matters as the Agents may reasonably request, in
form and substance satisfactory to the Agents.
(ii) Drinker ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, special counsel to the
Administrative Agent shall have delivered to the Administrative Agent a
favorable opinion of counsel, dated as of the Closing Date, as to such matters
as the Administrative Agent shall reasonably request.
(k) Solvency Opinion. The Borrowers shall have delivered letters
from their chief financial officers and from a nationally recognized appraisal
firm, valuation consultant or investment banking firm satisfactory to the Agents
each of which shall be in form and substance satisfactory to the Agents,
attesting to the solvency of the Borrowers, taken as a whole, after giving
effect to the transactions referred to herein (including the making of the
initial Loans and the acquisition of Multicare and its Subsidiaries by
Acquisition Corp.).
(l) Officers Certificate Regarding Senior Subordinated 12-1/2% Notes
and Convertible 7% Subordinated Debentures. Multicare, on behalf of Borrowers
shall have delivered a certificate dated the Closing Date signed by a
Responsible Officer detailing as of the Closing Date the amount of Multicare's
Convertible 7% Subordinated Debentures remaining outstanding and the maximum
amount necessary to redeem and retire all such Debentures by no later than March
16, 1998; and the amount of Multicare's Senior Subordinated 12-1/2% Notes
remaining outstanding and the maximum amount necessary to redeem and retire all
such Notes by no later than January 2, 1998.
(m) Consents and Approvals. All material corporate, governmental,
judicial and third party consents and approvals necessary in connection with
this Agreement and the other Loan Documents, the Tender Offer and the related
transactions (including consents and approvals required under or referred to in
the Merger Agreement) shall have been obtained and, as applicable, become final
orders (without imposition of any conditions that are not acceptable to the
Lenders) and shall remain in full force and effect and, to the extent
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requested by any Agent, copies thereof shall have been delivered to the
Administrative Agent. Without limiting the generality of the foregoing, all
appropriate filings shall have been made under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust
Improvements Act of 1976, as amended, and the applicable waiting periods
relating thereto shall have expired or been terminated without requests for
additional information from the reviewing agencies.
(n) Financial Statements; Projections.
(i) Financial Statements. The Borrowers shall have delivered,
or caused to be delivered, to the Administrative Agent, the Issuer
and the Lenders at least three (3) Business Days prior to the
Closing Date each of the following:
(x) a consolidated income statement of Multicare and its
consolidated Subsidiaries for the twelve calendar month period
ending on June 30, 1997, adjusted, on a pro forma basis to the
beginning of the period (as required for the financial
covenants) to reflect the consummation of all of the
transactions set forth in the Transaction Documents and all
Acquisitions and dispositions which shall have occurred within
said twelve month period as if such transactions, Acquisitions
and dispositions had occurred on the first day of such period,
which statement shall be supplemented by information
separating out and explaining all pro forma adjustments made
thereto; and
(y) a consolidated balance sheet of Multicare and its
consolidated Subsidiaries as of June 30, 1997, reflecting, on
a pro forma basis, the consummation of all transactions set
forth in the Transaction Documents including all borrowings in
connection therewith and all borrowings otherwise contemplated
hereunder, the application of all proceeds of such borrowings
and the amount of all outstanding Indebtedness after giving
effect to the foregoing, which balance sheet shall be
supplemented by information separating out and explaining all
pro forma adjustments made thereto;
each of which statements shall be (1) in form acceptable to the Agents, (2)
accompanied by explanatory notes acceptable to the Agents and (3) certified by
the chief financial officer of Acquisition Corp. to fairly present on a pro
forma basis the financial condition and results of operations as at the date, or
for the period, indicated.
(ii) Projections. Multicare on behalf of the Borrowers shall
have delivered to each Lender projections respecting the
consolidated financial condition and results of operations of
Multicare and its consolidated Subsidiaries for the period
commencing on January 1, 1997 and ending on December 31, 2002, which
projections shall be in reasonable detail, shall reflect the
consummation of the transactions contemplated hereby and the
Transaction Documents including the making of the initial Loans and
shall be accompanied by a written statement of the assumptions and
estimates underlying such projections.
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(o) Officer's Compliance Certificate. Multicare on behalf of the
Borrowers shall have delivered an Officer's Compliance Certificate, dated as of
the Closing Date, as to the truth of the representations and warranties herein
and in the other Loan Documents and the absence of any Default (in each case,
both before and after giving effect to the initial Loans). The Officer's
Compliance Certificate shall demonstrate that EBITDA of the Borrowers for the
twelve calendar month period ending June 30, 1997 (after making all adjustments
referred to in paragraph (n) above) is no less than $118,000,000.00 and Total
Funded Indebtedness of the Borrowers is not more than $760,000,000.00. The
Officer's Compliance Certificate delivered pursuant to this paragraph (o) shall
include a reconciliation of the financial information set forth thereon
respecting Multicare and its Restricted Subsidiaries and that set forth on the
financial statements for Multicare and its consolidated subsidiaries.
(p) Repayment of Predecessor Indebtedness. The Borrowers shall have
delivered to the Administrative Agent evidence that, prior to or substantially
simultaneously with the making of the initial Loans, (a) all Indebtedness of the
Borrowers other than that expressly permitted under Section 8.1 (Indebtedness)
below will be repaid, (b) all commitments to lend in respect of such
Indebtedness shall have been effectively terminated and (c) all collateral held
in connection therewith shall have been released (or undertakings to release
such collateral upon receipt of specified funds shall have been duly made) and
UCC-3 termination statements and all other documents necessary in the
determination of the Administrative Agent to effectively terminate of record all
security interests related to such Indebtedness shall have been duly executed by
the proper parties and shall have been delivered to the Administrative Agent (or
undertakings to do so upon receipt of specified funds shall have been furnished
to the Administrative Agent).
(q) Insurance. The Borrowers shall have delivered to the
Administrative Agent evidence of the insurance required by Section 6.8 below.
(r) Fees and Expenses. The Borrowers shall have paid the fees
required to be paid to the Agents and the Lenders on or before the Closing Date
and the fees and disbursements of counsel for the Agents in connection with the
negotiation, preparation, execution and delivery of the Loan Documents and the
making of the initial Loans.
(s) Closing of Genesis Credit Facilities. All conditions to the
initial funding under the Third Amended and Restated Credit Agreement, dated as
of the date hereof, among Genesis, certain of its Subsidiaries, Mellon as
administrative agent, and certain other agents and lenders referred to therein
(the "Genesis Credit Agreement") shall have been satisfied.
(t) Investment in Surety. Genesis shall have acquired approximately
44% of the common stock of Surety for a purchase price of at least
$325,000,000.00, Cypress, Nazem and TPG, collectively, shall have paid at least
$420,000,000.00 for the remainder of the common stock of Surety, and all of the
proceeds of the sale of such common stock shall have been contributed by the
Surety to Acquisition Corp.
(u) Acquisition and Merger. The Borrowers shall have submitted to
the Agents evidence satisfactory to the Agents that the total amount paid by
Acquisition Corp. to acquire the common stock of Multicare and by Acquisition
Corp. or Multicare to complete
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the merger of Acquisition Corp. into Multicare, including without limitation
consulting, severance and other payments to employees of Multicare,
non-competition, amounts provided to refinance existing indebtedness of
Multicare and all amounts of assumed indebtedness has not and will not exceed
$1,533,000,000.00 in the aggregate.
(v) 1997 Subordinated Note Indenture. The 1997 Subordinated Note
Indenture with terms and conditions satisfactory to the Agents in their sole
discretion, shall have been executed by the parties thereto, and Acquisition
Corp. shall have received at least $250,000,000.00 in gross proceeds from the
sale of the 1997 Subordinated Note and the net proceeds from such issuance shall
have been released to the Borrower from the escrow in which they were deposited.
(w) Tax Sharing Agreement. The Borrowers shall have delivered a copy
of the Tax Sharing Agreement duly executed by the Borrowers, the Surety and the
Excluded Subsidiaries (the "Tax Sharing Agreement"), limiting, as between the
parties thereto, the tax liabilities of the Borrowers in connection with a
consolidated tax filing (which may include as part of the consolidated group for
tax purposes the Borrowers, the Surety and the Excluded Subsidiaries), to the
amount of tax liabilities that the Borrowers would have incurred had they filed
separately. The Tax Sharing Agreement shall be certified as such by a
Responsible Officer of Multicare.
4.2 CONDITIONS TO EACH LOAN AND ISSUANCE OF EACH LETTER OF CREDIT.
(a) Conditions. The obligation of the Lenders to make any Loans,
including the initial Loans and the obligation of the Issuer to issue any
Letters of Credit are subject to fulfillment of each of the following
conditions, in each case, unless otherwise specified, to the satisfaction of the
Administrative Agent:
(i) Absence of Default. There shall not, either prior to or
after giving effect to each such Loan or Letter of Credit, as the case may be,
exist an Event of Default or a Default.
(ii) Borrowing Notice/L.C. Request. In connection with any
request for Loans (other than Swing Loans), the Administrative Agent shall have
received a borrowing notice as required by Section 1.3 above; in connection with
any request for the issuance of a Letter of Credit, the Issuer and the
Administrative Agent shall have received a Letter of Credit request as required
by Section 3.1 above; and in connection with any request for any Swing Loans,
the Swing Loan Lender and the Administrative Agent shall have received a Swing
Loan request as required by Section 1.3(e).
(iii) Truth of Representations. The representations and
warranties of the Borrowers and each other Loan Party made in this Agreement and
each other Loan Document shall be true and correct in all material respects as
of the date each such Loan is made or Letter of Credit issued (both immediately
prior to and after giving effect to said Loan or Letter of Credit) as if made on
and as of such date.
(iv) No Violations of Law. Neither the making of, nor use of
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proceeds of, such Loans nor the issuance of, or use of the proceeds of, such
Letters of Credit shall conflict with, or cause any Borrower to violate any Law.
(v) Compliance with Indenture Covenants. Neither the making of
such Loans nor the issuance of such Letters of Credit shall violate the terms of
the 1995 Subordinated Note Indenture or the 1996 Subordinated Note Indenture, if
and when applicable as set forth in Section 5.1(w), or the 1997 Subordinated
Note Indenture and Multicare shall deliver a certificate of its chief financial
officer or controller representing that, both before and after giving effect to
such additional Indebtedness, Multicare is in compliance with the financial
covenants set forth in Section 4.03 of the 1997 Subordinated Note Indenture and
that such Loans or Letters of Credit as the case may be constitute "Senior
Indebtedness" and "Designated Senior Indebtedness" as defined in the 1997
Subordinated Note Indenture and, if applicable as set forth in Section 5.1(w),
the 1995 Subordinated Note Indenture and the 1996 Subordinated Note Indenture.
(vi) Additional Information. The Lenders shall have received
such additional information and documentation as the Lenders may reasonably
request.
(b) Deemed Representation and Warranty. The request for, and
acceptance of, any Loan (including any Swing Loan) or Letter of Credit by any
Borrowers shall be deemed a representation and warranty by the Borrowers that
the conditions specified in clauses (i), (iii) and (iv) of the preceding
paragraph (a) have been satisfied.
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ARTICLE 5
REPRESENTATIONS AND WARRANTIES
5.1 REPRESENTATIONS. The Borrowers hereby jointly and severally represent
and warrant to each Lender Party as follows:
(a) Status of Borrowers. Each Borrower is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization. Each Borrower has the power and authority to own its property and
to transact the business in which it is engaged or presently proposes to engage.
Each Borrower is duly qualified to do business as a foreign corporation or
foreign partnership and is in good standing in all jurisdictions in which the
ownership of its properties or the nature of its activities or both makes such
qualification necessary or advisable, except for any failures to maintain such
qualifications which, individually or in the aggregate, could not have a
Material Adverse Effect. Schedule 5.1(a) hereto sets forth for each Borrower, as
of the Closing Date, (i) whether it is a corporation, limited partnership or
general partnership, (ii) the jurisdiction of its organization, and (iii) the
jurisdictions in which it is qualified to do business as a foreign corporation
or a foreign partnership, as the case may be, except where the failure to
maintain such qualification could not, individually or in the aggregate, have a
Material Adverse Effect. Each direct and indirect Subsidiary of Multicare, other
than the Excluded Subsidiaries, is a Borrower hereunder and is designated as
such on the signature pages hereto (or, after the Closing Date, on signature
pages of a Joinder Supplement hereto). The states in which any Borrowers operate
Health Care Businesses are Massachusetts, West Virginia, New Jersey, Ohio,
Pennsylvania, Wisconsin, Connecticut, Illinois, Rhode Island, Vermont and
Virginia.
(b) Capitalization of Borrowers. Schedule 5.1(b) hereto sets forth
(i) for each corporate Borrower, (A) the authorized capitalization, (B) the
names of the owners (indicating whether they are Borrowers) of the outstanding
capital stock, (C) the number and class of shares issued to each such owner and
(D) the percentage of outstanding shares of each class of capital stock owned by
each such owner, and (ii) for each Borrower which is a partnership, (A) the
names of the owners (indicating whether they are Borrowers) of the outstanding
equity thereof and (B) the percentage ownership interest of, and type of equity
issued to, each such owner. The outstanding equity of each Borrower has been
duly authorized and validly issued. All capital stock is fully paid and
nonassessable. Each Borrower owns beneficially and of record and has good title
to all equity indicated as being owned by it on said Schedule 5.1(b), free and
clear of any Lien, except for Liens in favor of the Administrative Agent, as
agent for the benefit of the Secured Parties, as contemplated by the Loan
Documents and other Permitted Liens. There are no options, warrants, calls, or
similar rights relating to equity of the Borrowers. No Excluded Subsidiary has
any equity interest in any Borrower.
(c) Authorization, Execution and Binding Effect of Loan Documents.
Each Borrower has the power and authority to execute, deliver, perform, and take
all actions contemplated by, each Loan Document to which it is a party, and all
such action has been duly and validly authorized by all necessary corporate or
partnership (as the case may be) proceedings on its part. This Agreement and
each other Loan Document has been duly and
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validly executed and delivered by each Loan Party listed on the signature pages
hereto or thereto, as the case may be. This Agreement and each other Loan
Document constitutes the legal, valid and binding obligation of each Loan Party
purporting to be a party hereto or thereto, as the case may be, enforceable
against such Person in accordance with its terms, except as the enforceability
hereof of thereof may be limited by bankruptcy, insolvency or other similar laws
of general application affecting the enforcement of creditors' rights or by
general principles of equity limiting the availability of equitable remedies.
(d) Security. The Pledge Agreement creates in favor of the
Administrative Agent for the benefit of the Secured Parties a legal, valid and
enforceable Lien on all right, title and interest of each Borrower in the
Collateral described therein, and the Administrative Agent has (or, upon the
filing of the UCC-1 financing statements delivered by the Borrowers on the
Closing Date, will have), for the benefit of the Secured Parties, a fully
perfected and continuing first priority Lien on all of the right, title and
interest of each Borrower in the Collateral described in the Pledge Agreement,
subject to no Liens other than Permitted Liens.
(e) Governmental Approvals and Filings; Absence of Conflicts. No
approval, order, consent, authorization, exemption or other action by, or
filing, recording or registration with, or notice to, any Governmental Authority
or other Person is necessary in connection with, the execution and delivery of
any Loan Document by any Loan Party, or in connection with the performance of
the terms hereof or thereof by such Person, other than the filing of Uniform
Commercial Code financing and continuation statements as referred to in the
Pledge Agreement. No Loan Party is subject to any Law which purports to restrict
or regulate its ability to borrow money, obtain credit or provide a guarantee or
other form of credit support as a consequence of the nature of the business
conducted by such Loan Party. Neither the execution and delivery of this
Agreement or any other Loan Document by any Loan Party, nor the performance of
or compliance with the terms and conditions hereof or thereof (including the
execution, delivery and performance of the Transaction Documents) by any Loan
Party does or will
(i) violate or conflict with any Law or any judgment, decree,
or order of a court or Governmental Authority or any settlement
agreement,
(ii) violate, conflict with or result in a breach of any term
or condition of, or constitute a default under, or cause an
acceleration of, or result in the creation or imposition of any Lien
upon any of property of any Loan Party (except for any Lien in favor
of the Administrative Agent pursuant to the Pledge Agreement) under
or in connection with,
(x) its articles or certificate of incorporation,
bylaws, partnership agreement or operating agreement (or other
constituent documents),
(y) any agreement or instrument creating, evidencing or
securing any Indebtedness in the aggregate amount of
$250,000.00 or more to which any Loan Party is a party or by
which it or any of its properties (now owned or hereafter
acquired) may be subject or bound, or
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(z) any other agreement or instrument or arrangement to
which it is a party or by which it or any of its properties
(now owned or hereafter acquired) may be subject or bound,
except, in the case of the foregoing clause (z), for matters that,
individually or in the aggregate, could not have a Material Adverse
Effect, or
(iii) result in a Limitation on any Licenses applicable to the
operations or properties of any Borrower, or adversely affect the
ability of any Borrower to participate in any Third Party Payor
Arrangement.
Except to the extent that the failure to obtain the same could not have a
Material Adverse Effect, no approval, order, consent of, authorization,
exemption or other action by, or filing, recording or registration with, or
notice to, any Governmental Authority or other Person is necessary in connection
with the Tender Offer and merger of Acquisition Corp. into Multicare except such
consents as are listed on Schedule 5.1(e) hereto all of which have been obtained
and are in full force and effect.
(f) Financial Statements. Multicare has heretofore furnished to the
Administrative Agent and each Lender consolidated balance sheets of Multicare
and its consolidated Subsidiaries as of December 31, 1996 and December 31, 1995
and the related consolidated statements of income, cash flows and changes in
stockholders' equity for the fiscal years then ended, as examined and reported
on by KPMG Peat Marwick, independent certified public accountants for Multicare,
who delivered an unqualified opinion in respect thereof. Such financial
statements (including the notes thereto) present fairly the financial condition
of Multicare and its consolidated Subsidiaries as of the end of each such fiscal
year and the results of their operations and their cash flows for the fiscal
years then ended, all in conformity with GAAP. Multicare has heretofore
furnished to the Administrative Agent, the Issuer and each Lender interim
consolidated balance sheets of Multicare and its consolidated Subsidiaries as of
the first two fiscal quarters of the fiscal year beginning January 1, 1997,
together with the related consolidated statements of income, cash flows and
changes in stockholders' equity for the applicable fiscal periods ending on each
such date. Such financial statements (including the notes thereto), as well as
those financial statements delivered pursuant to paragraph (n) of Section 4.1
above, present fairly the financial condition of Multicare and its consolidated
Subsidiaries as of the date specified and the results of their operations and
their cash flows for the fiscal periods specified, all in conformity with GAAP,
subject to normal and recurring year-end audit adjustments, except that such
financial statements do not contain all of the footnote disclosures required by
GAAP. There are no material liabilities of the Borrowers except as disclosed on
such financial statements. Schedule 8.1 hereto sets forth, as of the Closing
Date, all Indebtedness (and commitments for Indebtedness) of the Borrowers.
(g) Projections. The projections delivered pursuant to paragraph (n)
of Section 4.1 above and the assumptions and estimates referred to therein are,
as of the Closing Date, reasonable, are made in good faith, are consistent with
the Loan Documents and represent the Borrowers' best judgment as to such
matters. Nothing has come to the attention of any Borrower which would lead such
Borrower to believe that such projections will not be attained or exceeded
provided, however, that nothing contained in this paragraph (g) shall constitute
a representation or warranty that such future financial performance or
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results of operations will in fact be achieved.
(h) Absence of Material Adverse Change. Since December 31, 1996,
there has been no material adverse change in the business, operations, condition
(financial or otherwise), properties or prospects of the Borrowers taken as a
whole or the industry served by the Borrowers.
(i) Title to Property. Each Borrower has good and marketable title
to all property owned or purported to be owned by it, including but not limited
to all property reflected in the most recent balance sheets delivered to the
Lenders pursuant to this Agreement (except such property as was sold or
otherwise disposed of in accordance with Section 8.5 (Dispositions) below)
subject to no Liens except Permitted Liens. Schedule 8.2 hereto sets forth, as
of the Closing Date, all Liens on property of the Borrowers.
(j) Solvency. The present fair saleable value of the assets of the
Borrowers, taken as a whole, after giving effect to all the transactions
contemplated by the Loan Documents and the funding of the Loans and the issuance
of the Letters of Credit hereunder exceeds the amount that will be required to
be paid on or in respect of the existing debts and other liabilities (including
contingent liabilities) of Borrowers, taken as a whole, as they mature.
Multicare does not intend to, nor does Multicare believe that it will, incur
debts beyond its ability to pay such debts as they mature (taking into account
the timing and amounts of cash to be received by Multicare, and of amounts to be
payable on or in respect of debt of Multicare). The property of each Borrower
does not constitute unreasonably small capital for such Borrower to carry out
its business as now conducted and as proposed to be conducted including the
capital needs of such Borrower. The cash available to each Borrower after taking
into account all other anticipated uses of the cash of such Borrower, is
anticipated to be sufficient to pay all such amounts on or in respect of debt of
such Borrower when such amounts are required to be paid.
(k) Accurate and Complete Disclosure. The information heretofore,
contemporaneously or hereafter provided in writing by or on behalf of any
Borrower to any Lender Party pursuant to or in connection with this Agreement or
any other Loan Document is or will be (as the case may be) true and accurate in
all material respects on the date as of which such information is dated (or, if
not dated, when received by such Lender Party) and does not or will not (as the
case may be) omit to state any material fact necessary to make such information
not misleading at such time in light of the circumstances in which it was
provided.
(l) Legal and Administrative Proceedings. There is no action, suit,
litigation or proceeding pending, or to the knowledge of the Borrowers,
threatened nor, to the knowledge of the Borrowers, is there any investigation
pending or threatened, in any court or before any arbitrator or Governmental
Authority or any payor appeals bodies respecting or relating to any Borrowers
(or any officer or director thereof) or any property of any Borrowers that,
individually or in the aggregate, (i) could have a material adverse effect on
the business, condition (financial or otherwise), operations, properties or
prospects of the Borrowers taken as a whole or (ii) could materially adversely
affect the Lenders' rights and remedies hereunder or under the other Loan
Documents, this Agreement or other Loan Documents or the ability of the
Borrowers to perform their obligations hereunder or thereunder.
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(m) Absence of Violations and Conflicts. No Borrower is in violation
of, in default under, or is subject to any contingent liability on account of
any violation of or conflict with: (i) any Law; (ii) its articles or certificate
of incorporation, bylaws, partnership agreement, operating agreement (or other
constituent documents); or (iii) any financing agreement or other instrument or
arrangement to which it is a party or by which it or any of its properties (now
owned or hereafter acquired) may be subject or bound, except, with respect to
clauses (i) or (iii) above for matters that, individually or in the aggregate,
could not have a Material Adverse Effect.
(n) Operation of Health Care Facilities.
(i) Except where the failure to possess the same, either
individually or in the aggregate, could not have a Material Adverse Effect, each
Borrower possesses all Licenses and Reimbursement Approvals necessary to operate
its Health Care Businesses substantially as now operated and as presently
proposed to be operated. No Borrower is in material violation of the terms of
its Licenses and Reimbursement Approvals.
(ii) Except for Limitations which, individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect,
there is no threatened or pending Limitation of any material License or
Reimbursement Approval relating to the operation of any of Borrowers' Health
Care Businesses.
(iii) Except where the failure to file the same, either
individually or in the aggregate, could not have a Material Adverse Effect, each
of the Borrowers has caused there to be accurately prepared and filed (or
obtained extensions for) all applicable cost reports with respect to any and all
Third Party Payor Arrangements that are material to conduct its Health Care
Businesses substantially as now conducted.
(iv) No Borrower is subject to any claim (including any claim
for overpayment), litigation, proceeding or other action or, to any Borrower's
knowledge, investigation relating to a claim or action by any Governmental
Authority except matters that, if adversely decided, individually or in the
aggregate, could not have a Material Adverse Effect.
(v) Each of the Borrowers participates in an internal
comprehensive compliance program respecting compliance with all Laws affecting
the types of businesses carried on by Borrowers (including health care Laws) and
has made such program available for review by any Lender, upon request.
(vi) Each of the foregoing statements in this paragraph (n)
are also true as applied to Persons managed by any Borrower to the extent that
the failure of any such statement to be true (as applied to any Person managed
by a Borrower) could have a Material Adverse Effect.
(o) Management Agreements. Schedule 5.1(o) sets forth as of the
Closing Date, a complete and correct list of all Management Agreements relating
to (i) the operation and management by a Person that is not a Borrower of each
health care facility owned by a Borrower and (ii) the operation and management
by a Borrower of each health care facility owned by a Person that is not a
Borrower. As of the Closing Date, each such Management
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Agreement is in full force and effect subject to no material default.
(p) Health Care Business. Schedule 5.1(p) sets forth, as of the
Closing Date, a complete and correct list of all Health Care Businesses owned or
operated by the Borrowers and the locations thereof indicating which such Health
Care Businesses are operated but not owned.
(q) Leased Properties. Schedule 5.1(q) identifies all properties
leased by any Borrower as of the Closing Date. As of the Closing Date, all
leases relating to such leased properties are in full force and effect subject
to no material default. Such leases comply with the provisions of Section 8.7
below.
(r) Intellectual Property. Each Borrower owns, or is licensed or
otherwise has the right to use, all the patents, trademarks, service marks,
names (trade, service, fictitious or otherwise), copyrights, technology
(including computer programs and software), processes, data bases and other
rights (collectively, "intellectual property"), free from burdensome
restrictions, necessary to own and operate its properties and to carry on its
business as presently conducted and presently planned to be conducted without
conflict with the rights of others. No Borrower is in material violation of the
rights of others with respect to any intellectual property.
(s) Employee Benefits/ERISA.
(i) The Borrowers and the members of their Controlled
Groups maintain only those Defined Benefit Pension Plans, Defined
Contribution Plans and other Plans listed on Schedule 5.1(s)
attached hereto and contribute to only those Multiemployer Plans
listed on Schedule 5.1(s) attached hereto.
(ii) Each Defined Benefit Plan and Defined Contribution
Plan, as most recently amended, including amendments to any trust
agreement, group annuity, or insurance contracts, or other governing
instrument, is the subject of a favorable determination letter by
the Internal Revenue Service with respect to its qualification under
ss.401(a) of the Code.
(iii) All Plans comply, both in form and in operation,
with the requirements of the Code and ERISA.
(iv) There is not now, and has not been, any material
violation of the Code or ERISA with respect to the filing of
applicable reports, documents, and notices regarding any Plan with
the Secretary of Labor, the Secretary of the Treasury, the PBGC or
any other governmental entity or the furnishing of such documents to
the participants or beneficiaries of any Plan. Borrowers have
furnished to the Lenders copies of the most recent annual report,
audited financial statements, and other reports filed with the
Secretary of Labor, the Secretary of the Treasury, the PBGC or any
other governmental entity with respect to each Plan.
(v) All Pension Plans, as of the date hereof, meet the
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minimum funding standards of ss.412 of the Code and ss.302 of ERISA
without regard to any funding waiver. Borrowers and the members of
their Controlled Group have, as of the date hereof, made all
contributions or payments to or under Pension Plans required by the
terms of any such Plan or any contract or agreement.
(vi) No Material liability to the PBGC has been, or is
expected by any Borrower or any member of its Controlled Group to
be, incurred by the Borrower or any member of its Controlled Group.
(vii) No Defined Benefit Pension Plan has any Amount of
Unfunded Benefit Liabilities except as listed on Schedule 5.1(s)
which, in the aggregate, do not exceed $500,000.00.
(viii) No trust was established in connection with any
Defined Benefit Pension Plan pursuant to ss.4049 of ERISA (as in
effect on December 17, 1987) and no liabilities (whether or not such
liability is being litigated) have been asserted against any
borrower or any member of its Controlled Group in connection with
any such Defined Benefit pension Plan by the PBGC or by a trustee
appointed pursuant to ss.4042(b) or (c) of ERISA, and no lien has
been attached and no person has threatened to attach a lien on any
property of any Borrower or any member of its Controlled Group as a
result of any failure to comply with the Code or ERISA.
(ix) No Prohibited Transaction has occurred with respect
to any Plan.
(x) No Reportable Event has occurred with respect to any
Defined Benefit Plan.
(xi) No Borrower or any member of its Controlled Group
has any unfunded liabilities of unfunded and uninsured "employee
welfare benefit plans" (as defined in ss.3(1) of ERISA).
(xii) There is not now, and has not been, any COBRA
Violation with respect to any Plan to which such continuation
coverage requirements apply which has a material adverse effect,
directly or indirectly, on the financial condition of any of the
Borrowers.
(xiii) Borrowers and the members of their Controlled
Group have established only those irrevocable trusts the assets of
which remain subject to the general creditors of Borrowers and/or
members of their Controlled Group (sometimes referred to as "rabbi
trusts") listed on Schedule 5.1(s) attached hereto and have
furnished to the Lenders copies of each such "rabbi trust."
(xiv) If any Borrower or any member of its Controlled
Group were obligated to pay the entire potential Withdrawal
Liabilities for which any of them would be liable if each of them
were to withdraw from the
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Multiemployer Plans to which any of them makes contributions, such
obligations would not be in excess of $500,000.00.
(xv) Borrowers and the members of their Controlled Group
have complied with the requirements of ss.515 of ERISA with respect
to Multiemployer Plans.
(t) Environmental Matters.
(i) Each Borrower and each of its respective
Environmental Affiliates is and has been, in full compliance with
all applicable Environmental Laws, except for matters which,
individually or in the aggregate, could not have a Material Adverse
Effect. There are no circumstances that may prevent or interfere
with such full compliance now or in the future.
(ii) Each Borrower and each of its respective
Environmental Affiliates have all Environmental Approvals necessary
or desirable for the ownership and operation of their respective
properties, facilities and businesses as presently owned and
operated and as presently proposed to be owned and operated, in the
future, except for matters which, individually or in the aggregate,
could not have a Material Adverse Effect.
(iii) There is no Environmental Claim pending or to the
knowledge of any Borrower after due inquiry, threatened, and there
are no past or present acts, omissions, events or circumstances
(including but not limited to any dumping, leaching, deposition,
removal, abandonment, escape, emission, discharge or release of any
Environmental Concern Material at, on or under any facility or
property now or previously owned, operated or leased by any Borrower
or any Environmental Affiliates of Borrowers) that could form the
basis of any Environmental Claim against any Borrower or any such
Environmental Affiliates, except for matters which, if adversely
decided, individually or in the aggregate, could not have a Material
Adverse Effect.
(iv) No facility or property now or previously owned,
operated or leased by any Borrower or any of their respective
Environmental Affiliates is an Environmental Cleanup Site. No
Borrower and none of their respective Environmental Affiliates has
directly transported or disposed of or arranged for the
transportation or disposal of any Environmental Concern Materials to
any Environmental Cleanup Site. No Lien exists, and, to the
Borrowers' knowledge after due inquiry, no condition exists which
could result in the filing of a Lien, against any property of any
Borrower or any Subsidiary of any Borrower or any of their
respective Environmental Affiliates, under any Environmental Law.
(u) Margin Regulations. No proceeds of any Loan hereunder will be
used for the purpose of purchasing or carrying any "margin stock," as such term
is used in Regulations G and U of the Board of Governors of the Federal Reserve
System, as amended from time to time, or to extend credit to others for the
purpose of purchasing or carrying any "margin stock". Neither the making of any
Loan or issuance of any Letter of Credit nor any
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use of proceeds of the foregoing will violate or conflict with the provisions of
Regulation G, T, U or X of the Board of Governors of the Federal Reserve System,
as amended from time to time.
(v) Regulation O. No director, executive officer or principal
shareholder of any Borrower is a "director," "executive officer" or "principal
shareholder" of any Lender, as such terms are used in Regulation O of the Board
of Governors of the Federal Reserve System, as amended.
(w) Subordinated Notes. Multicare hereby confirms that the Loan
Obligations are "Senior Indebtedness" and hereby designates the Loan Obligations
as "Designated Senior Indebtedness" under the 1997 Subordinated Note Indenture.
All of the Loan Obligations constitute and will constitute "Senior Indebtedness"
and "Designated Senior Indebtedness" within the meaning ascribed to such terms
in such indentures. The subordination provisions therein are enforceable against
the respective issuers thereunder and the holders, from time to time, of the
1997 Subordinated Notes. The respective issuers are not in default under any
such indenture. From the time that the Put/Call Agreement is exercised and
Genesis owns 100% of the capital stock of Surety or at any other time that any
financial or other covenants of the 1995 Subordinated Note Indenture or the 1996
Subordinated Note Indenture may apply to Multicare and its Subsidiaries, the
foregoing statements shall be equally applicable with regard to the 1995
Subordinated Note Indenture and 1996 Subordinated Note Indenture.
(x) Certain Documents and Transactions. Each of the Transaction
Documents (including the Multicare Management Agreement), and the Tax Sharing
Agreement are in full force and effect and no amendments, modifications or
supplements have been made to any such documents as the same were delivered to
the Agents pursuant to Article 4 above except (i) such amendments, modifications
or supplements to Transaction Documents as could not reasonably be expected to
have an adverse effect on any Borrower (including the condition (financial or
otherwise), properties or prospects of such Borrower), the Loan Documents or any
Lender Parties and (ii) supplements or amendments to the Tax Sharing Agreement
necessary to join any other Subsidiaries of Multicare which may hereafter be
consolidated with Multicare for tax purposes. There exists no default under any
such agreements except for immaterial breaches.
(y) Labor Matters. There are no existing, or, to the best of
Borrowers' knowledge, threatened or contemplated, strikes, slowdowns, picketing
or work stoppages by any employees against any Borrower, any lockouts by any
Borrower of any of its employees or any labor trouble or other occurrence, event
or condition of a similar character which individually or in the aggregate,
could have a Material Adverse Effect.
5.2 REPRESENTATIONS AND WARRANTIES ABSOLUTE. The representations and
warranties of the Borrowers set forth in this Article 5 are unaffected by any
prior or subsequent investigation by, or knowledge of, any Agent, the Issuer, or
any Lender.
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ARTICLE 6
AFFIRMATIVE COVENANTS
So long as any Loan Obligation shall remain unpaid or any Lender
shall have any Commitment under this Agreement, each of the Borrowers shall
comply with the following covenants.
6.1 REPORTING REQUIREMENTS.
(a) Annual Financial Statements. As soon as practicable, and in any
event within 90 days after the close of each fiscal year of Multicare, Multicare
(on behalf of the Borrowers) shall furnish to the Administrative Agent, the
Issuer and each Lender, audited
(i) consolidated statements of income, cash flows and changes
in stockholders' equity of Surety, Multicare and its consolidated
Subsidiaries (the "Multicare Group") for such fiscal year and a
consolidated balance sheet of such Persons as of the close of such
fiscal year. If at any time the Cash Flow of the Excluded
Subsidiaries in the aggregate exceeds 3% of the Cash Flow of
Multicare and its consolidated Subsidiaries, Multicare on behalf of
the Borrowers shall furnish statements of income, cash flows and
changes in stockholders equity of the Borrowers on a consolidated
basis, for such fiscal year and a balance sheet of such Persons, on
a consolidated basis, as of the close of such fiscal year, in lieu
of the requirements of the preceding sentence; and
(ii) statements of income, cash flows and changes in
stockholders equity of Genesis and its Subsidiaries (including the
Multicare Group), on a consolidated basis, for such fiscal year and
a balance sheet of Genesis and its Subsidiaries, on a consolidated
basis, as of the close of such fiscal year,
and with respect to all of the foregoing financial statements
referred to above setting forth the appropriate footnotes, all in
reasonable detail, setting forth in comparative form the
corresponding figures for the preceding fiscal year. Such financial
statements shall be accompanied by an unqualified opinion in form
and substance satisfactory to the Administrative Agent of
independent certified public accountants of recognized national
standing selected by the Borrowers and satisfactory to the
Administrative Agent.
(b) Quarterly Financial Statements. As soon as practicable, and in
any event within 45 days after the close of each fiscal quarter of each fiscal
year of Multicare, Multicare, on behalf of the Borrowers, shall furnish to the
Administrative Agent, the Issuer and each Lender, the following unaudited
financial statements:
(i) consolidated statements of income, cash flows and changes
in stockholders' equity of the Multicare Group for such fiscal
quarter and the applicable year to date period, and a consolidated
balance sheet of such
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Persons as of the close of such fiscal quarter. If at any time the
Cash Flow of the Excluded Subsidiaries in the aggregate exceeds 3%
of the Cash Flow of Surety, Multicare and its Subsidiaries,
Multicare, on behalf of the Borrowers shall furnish statements of
income, cash flows and changes in stockholders equity of the
Borrowers on a consolidated basis, for such fiscal quarter and
applicable year-to-date period, in lieu of the requirements of the
preceding sentence; and
(ii) statement of income, cash flows and changes in
stockholders' equity for Genesis and its Subsidiaries (including the
Multicare Group), on a consolidated basis, for such fiscal quarter,
together with the applicable year to date period and a balance sheet
of such Persons on a consolidated basis as of the end of such fiscal
quarter.
all in reasonable detail, setting forth in comparative form the
corresponding figures for the same periods or as of the same date
during the preceding fiscal year (except for the balance sheets,
which shall set forth in comparative form the corresponding balance
sheets as of the prior fiscal year end). Such financial statements
shall be certified by the chief financial officer or other
Responsible Officer of Multicare and Surety, as appropriate, as
presenting fairly the financial position of the subject entities as
of the end of such fiscal quarter and year-to-date period, and the
results of their operations and their cash flows and changes in
stockholders' equity for such fiscal quarter and year-to-date
period, in conformity with GAAP, subject to normal and recurring
year-end audit adjustments.
(c) Quarterly Compliance Certificates. Surety and Multicare, on
behalf of the Borrowers, shall deliver to the Administrative Agent, the Issuer
and each Lender, an Officer's Compliance Certificate concurrently with the
delivery of the financial statements referred to in paragraph (a) of this
Section 6.1 (with respect to the fiscal year) and paragraph (b) of this Section
6.1 (with respect to the first three fiscal quarters). Each such Officer's
Compliance Certificate shall include among other things referred to therein the
calculations necessary to demonstrate the Borrowers' compliance with the
covenants set forth in Article 7 hereof. In addition, the Officers' Compliance
Certificate shall show the calculations necessary to confirm compliance with the
financial covenants set forth in Section 4.03 of the 1997 Subordinated Note
Indenture. The Officer's Compliance Certificate delivered pursuant to this
paragraph (c) shall include a reconciliation of the financial information set
forth thereon respecting Multicare and its Restricted Subsidiaries and that set
forth on the financial statements for Multicare and its consolidated
Subsidiaries.
(d) Other Information To Be Delivered Annually. Multicare, on behalf
of the Borrowers, shall deliver to the Administrative Agent, the Issuer and each
Lender, the following: (i) annually, within one hundred twenty (120) days of the
end of Multicare's fiscal year, an accountants' management letter respecting
Multicare and its consolidated Subsidiaries, provided by independent certified
public accountants satisfactory to the Administrative Agent, and (ii) annually,
no later than ninety (90) days prior to the commencement of each fiscal year of
Multicare's, an annual budget respecting Multicare and its consolidated
Subsidiaries, setting forth in reasonable detail, expected sources and uses of
funds, for the fiscal year then beginning in form and substance satisfactory to
the
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Administrative Agent.
(e) SEC Filings and Other Disclosure. Promptly upon their becoming
available to any Borrower or Surety but no later than ten Business Days after
the same are filed with the Securities Exchange Commission or any securities
exchange, Multicare, on behalf of the Borrowers, shall deliver to the
Administrative Agent, the Issuer and each Lender, a copy of (i) all regular or
special reports, registration statements and amendments to the foregoing which
any Borrower or any of its Affiliates shall file with the Securities and
Exchange Commission or any securities exchange, (ii) all reports, proxy
statements, financial statements and other information distributed by any
Borrower or any of its Affiliates to its stockholders, bondholders or the
financial community generally, (iii) all accountants' management letters (not
otherwise delivered pursuant to the preceding paragraph (d)) and all other
reports submitted by accountants in connection with any audit of any Borrower or
the Surety, and (iv) copies of all compliance certificates and notices delivered
to or from the trustees under the 1997 Subordinated Note Indenture.
(f) Notice of Certain Events. Promptly upon any Borrower becoming
aware of any of the following, such Borrower or Multicare, on behalf of the
Borrowers, shall give the Administrative Agent notice thereof, together with a
written statement setting forth the details thereof and any action with respect
thereto taken or proposed to be taken by any Borrower:
(i) Loss of Licenses or Reimbursement Approvals. Any actual
Limitation (other than in the ordinary course of business) or any
threatened Limitation (to the extent that it individually or in the
aggregate with all other actual or threatened Limitations is
material) of any License or Reimbursement Approval relating to the
operation of a Health Care Business or, if the same individually or
in the aggregate could have a Material Adverse Effect, any
Limitation of any License or Reimbursement Approval of any Person
managed by any Borrower;
(ii) Default. Any Event of Default or Default;
(iii) Material Adverse Change. Any material adverse change in
the business, operations or condition (financial or otherwise), or
prospects of any Borrower;
(iv) Material Litigation. Any pending or threatened action,
suit, proceeding or investigation by or before any Governmental
Authority against or affecting any Borrower (or any officer or
director thereof) or any property of any Borrower, except for
matters that if adversely decided, individually or in the aggregate,
could not have a Material Adverse Effect;
(v) Breach or Termination of Certain Agreements. Any breach,
claimed breach, termination or purported or threatened termination
(including a copy of any notice of termination) of (A) the Multicare
Management Agreement, (B) any other Transaction Document (except a
termination in accordance with its terms), (C) any other Management
Agreement except in the ordinary course of business, (D) the 1997
Subordinated Note Indenture, if
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and when applicable as set forth in Section 5.1(w), the 1995
Subordinated Note Indenture and/or, the 1996 Subordinated Note
Indenture (including a copy of any notice of default delivered
thereunder) or (E) any other agreement or instrument material to the
business, operations, condition (financial or otherwise) or
prospects of Multicare and its Restricted Subsidiaries taken as a
whole.
(vi) ERISA.
(A) any taxes, penalties, interest charges and other
financial obligations in excess of $250,000.00 that have been
assessed or otherwise imposed, or which any Borrower has
reason to believe may be assessed or otherwise imposed in
excess of $250,000.00, against any Borrower or any member of
its Controlled Group by the Internal Revenue Service, the
PBGC, the Department of Labor or any other governmental entity
with respect to any Plan or Multiemployer Plan;
(B) any application for a waiver by a Borrower or any
member of its Controlled Group of the minimum funding standard
under ss.412 of the Code with respect to a Pension Plan;
(C) the adoption of any Plan, including but not limited
to a Defined Benefit Pension Plan, or any obligation to
contribute to any Multiemployer Plan by a Borrower or any
member of its Controlled Group;
(D) any Prohibited Transaction with respect to a Plan.
(E) (1) that any Reportable Event has or will occur with
respect to any Defined Benefit Pension Plan maintained by any
Borrower or any member of its Controlled Group, (2) that any
Defined Benefit Pension Plan maintained by any Borrower or any
member of its Controlled Group is to be terminated in
"distress termination" (within the meaning of ss.4041(c) of
ERISA), (3) that the PBGC has instituted or will institute
proceedings under Title IV of ERISA to terminate any Defined
Benefit Pension Plan maintained by any Borrower or any member
of its Controlled Group, (4) that any Borrower has incurred
Withdrawal Liability from a Multiemployer Plan maintained by
it or any member of its Controlled Group, (5) that any
Multiemployer Plan to which any Borrower or any member of its
Controlled Group has made contributions is or will be in
Reorganization, or (6) that any other condition exists with
respect to a Defined Benefit Pension Plan or Multiemployer
Plan which presents a material risk of termination of any such
Plan, Borrowers will furnish a statement to the Lenders
setting forth the details of such Reportable Event, distress
termination, termination proceedings, Withdrawal Liability,
Reorganization or condition, and the action that Borrowers
propose to take with respect thereto, together with a copy of
any notice of such Reportable Event or distress termination
given to the PBGC, or a copy of any notice of
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termination proceedings, Withdrawal Liability or
Reorganization received by such Borrower or any member of its
Controlled Group.
(F) any default by Borrower or any member of its
Controlled Group (as defined in ss.4219(c)(5) of ERISA) with
respect to payments to a Multiemployer Plan required by reason
of its withdrawal (as defined in ss.4203 or ss.4205 of ERISA).
(G) any action brought against Borrower or any member of
its Controlled Group under ss.502 of ERISA with respect to its
failure to comply with ss.519 of ERISA.
(vii) Environmental. Any Environmental Claim pending or
threatened against any Borrower or any of its Environmental
Affiliates, or any past or present acts, omissions, events or
circumstances (including but not limited to any dumping, leaching,
deposition, removal, abandonment, escape, emission, discharge or
release of any Environmental Concern Material at, on or under any
facility or property now or previously owned, operated or leased by
any Borrower or any of its Environmental Affiliates) that could form
the basis of such Environmental Claim, which Environmental Claim, if
adversely resolved, individually or in the aggregate, could have a
Material Adverse Effect.
(g) Other ERISA Information. The Borrowers shall deliver to the
Administrative Agent, copies of the following:
(A) Promptly after the filing thereof with the Secretary
of Labor, the Secretary of the Treasury, the PBGC or any other
governmental entity, copies of each annual report, each
audited financial statement and any other report so filed with
respect to each Plan.
(B) As soon as possible (and in any event within five
days) after the receipt by any Borrower or any member of its
Controlled Group of a demand letter from the PBGC notifying
any Borrower or any member of its Controlled Group of the
final decision finding liability and the date by which such
liability must be paid, Borrowers will furnish to the Lenders
a copy of such letter together with a statement to the Lenders
setting forth the action which Borrowers propose to take with
respect thereto.
(C) Borrowers will furnish to the Lenders as soon as
possible after receipt thereof a copy of any notice that any
Borrower or any member of its Controlled Group receives from
the PBGC, the Internal Revenue Service, the Department of
Labor or any other governmental entity or the sponsor of any
Multiemployer Plan that sets forth or proposes any action to
be taken or determination made by the PBGC, the Internal
Revenue Service, the Department of Labor or any other
governmental entity or the sponsor of any Multiemployer Plan
with
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respect to any Plan.
(h) Amendments to Transaction Documents. Multicare (on behalf of the
Borrowers) shall furnish the Administrative Agent copies or drafts of all
proposed amendments, modifications or waivers to any Transaction Documents (1)
in the case of any amendments, modifications or waivers requiring the consent of
the Required Lenders at least 20 Business Days prior to the effective date
thereof and (2) in all other cases, at least 5 Business Days prior to the
effective date thereof.
(i) Notice of Non-Renewal of Management Agreement. Multicare, on
behalf of the Borrowers shall give the Administrative Agent written notice
promptly upon receipt of delivery of any notice of non-renewal or termination
delivered under or relating to the Multicare Management Agreement. The
Administrative Agent shall promptly give each Lender a copy of any notice
delivered pursuant to this paragraph (i).
(j) Notices under Indenture. Multicare, on behalf of the Borrowers
shall furnish to the Administrative Agent copies of all notices, reports,
certificates or other material delivered to or by the trustee or any other party
under the 1997 Subordinated Note Indenture, promptly upon receipt thereof.
(k) Other Information. In addition, the Borrowers will promptly
furnish, and cause Surety to furnish, to the Administrative Agent such other
information as any Lender Party, through the Administrative Agent, may
reasonably request including information submitted by the Borrowers or the
Surety to any Governmental Authority and the Administrative Agent will furnish
such information to the requesting Lender Party.
6.2 MAINTENANCE OF EXISTENCE. Each Borrower shall preserve and maintain,
and shall cause Surety to preserve and maintain, its corporate or partnership
existence, as the case may be, and good standing in the jurisdiction of its
organization provided, however, upon giving written notice to the Administrative
Agent, the Borrowers may dissolve any Subsidiary if (a) such Subsidiary is not
(either individually or in the aggregate with all other entities dissolved
pursuant to this proviso) a material Borrower (or material Borrowers) and (b)
Multicare determines that it is in the best interest of the Borrowers, taken as
a whole, that such Subsidiary be dissolved. Multicare and (to the extent that
any failure to qualify or remain qualified could have a Material Adverse Effect)
each Restricted Subsidiary shall qualify and remain qualified as a foreign
corporation or partnership in each jurisdiction in which such qualification is
required, provided, however nothing in this Section 6.2 shall prohibit any sales
or other dispositions permitted under Section 8.5 or Section 8.13.
6.3 CONDUCT OF BUSINESS AND MAINTENANCE OF LICENSES AND OTHER PROPERTY.
(a) Type of Business. Each Borrower shall continue to engage in the
business of the same general type as conducted by the Borrowers on the Closing
Date and not engage in any other type of business without the consent of the
Required Lenders.
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(b) Healthcare and Regulatory Rights. Except where the failure to
take any of the following actions, individually or in the aggregate, could not
have a Material Adverse Effect, each Borrower shall (i) maintain in effect all
Licenses and Reimbursement Approvals necessary or appropriate to own and operate
all Health Care Businesses which it owns or operates and (ii) obtain all
Licenses and Reimbursement Approvals necessary or appropriate to own and operate
all Health Care Businesses which it acquires and (iii) continue its
participation in any and all Third Party Payor Arrangements. Except where such
failure to so comply (together with all other failures from time to time by the
same or other Borrowers), could not reasonably be expected to have a Material
Adverse Effect, each Borrower shall comply with any and all rules, regulations,
standard procedures and decrees necessary to maintain its participation in any
such Third Party Payor Arrangements and prepare and file all applicable cost
reports with respect to all Third Party Payors Arrangements to the extent
required. Each Borrower shall use its best efforts to cause each Person managed
by it to obtain and maintain its Licenses and Reimbursement Approvals necessary
for the conduct of its business and to continue its participation in Third Party
Payor Arrangements and comply with all rules, regulations, standard procedures
and decrees relating thereto to the extent that the failure to do so could have
a Material Adverse Effect.
(c) Maintenance of Property. Each Borrower shall maintain, keep and
preserve all of its property necessary or useful in the proper conduct of its
business in good working order and condition, ordinary wear and tear excepted
(except for sales and other dispositions of property permitted under Section 8.5
below (Dispositions)). Without limiting the generality of the foregoing, each
Borrower shall maintain in full force and effect each lease, Management
Agreement and other material agreement used or useful in its business, subject
to no material default except where the loss of, or default under, such lease,
Management Agreement or other agreement (i) could not individually or in the
aggregate reasonably be expected to have a Material Adverse Effect or (ii) is
not otherwise prohibited by the terms of this Agreement.
6.4 MAINTENANCE OF RECORDS; FISCAL YEAR. Each Borrower shall keep adequate
records and books of account, in which complete entries will be made in
accordance with historical practice and GAAP, reflecting all financial
transactions of the Borrowers. Each Borrower shall maintain, and shall cause the
Surety to maintain, a fiscal year end of December 31.
6.5 COMPLIANCE WITH LAWS. Each Borrower shall comply (and maintain
procedures to assure compliance) in all material respects with all applicable
Laws (including environmental and health care Laws) and all judgments, decrees
or orders of any court or Governmental Authority and all settlement agreements.
Without limiting the generality of the foregoing, each of the Borrowers shall
maintain in full force and effect an internal compliance program respecting
compliance with all Laws affecting the types of businesses carried on by the
Borrowers (including healthcare Laws) and make such program available for review
by any Lender, upon request.
6.6 ERISA.
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(a) Each Borrower will, and will cause each member of its Controlled
Group, to comply in all material respects with the provisions of ERISA and the
Code with respect to any Plan both in form and in operation.
(b) Each Borrower will cause to be made all contributions required
to avoid any Accumulated Funding Deficiency, whether or not waived, with respect
to any Pension Plan.
(c) No Borrower will adopt or permit the adoption by any member of
its Controlled Group of any Defined Benefit Pension Plan which would result in
any Amount of Unfunded Benefit Liabilities in excess of $500,000.00.
(d) No Borrower will acquire, or permit the acquisition by any
member of its Controlled Group of, any trade or business which has incurred
either directly or indirectly any Amount of Unfunded Benefit Liabilities under
any Defined Benefit Pension Plan in excess of $500,000.00.
(e) The Borrowers will not permit with respect to any Plan, any
Prohibited Transaction or Prohibited Transactions under ERISA or the Code
resulting in liability of any Borrower or any member of its Controlled Group
which together with any other liabilities subject to this paragraph (e) would in
the aggregate be in excess of $500,000.00, unless such Borrower or any member of
its Controlled Group will be contesting in good faith and by appropriate
proceedings any such matter and measures are available and are being taken which
have the effect of preventing the seizure of property of such Borrower or any
member of its Controlled Group pending the outcome of such contest.
(f) No Borrower will withdraw, or permit any member of its
Controlled Group to withdraw, from any Multiemployer Plan to which any of them
may hereafter contribute if the Withdrawal Liability which would thereupon be
incurred would have a material adverse effect, directly or indirectly, on the
financial condition of any of the Borrowers.
(g) No Borrower will permit any unfunded liabilities of unfunded and
uninsured "employee welfare benefit plans" (as defined in ss.3(1) of ERISA) of
any Borrower and of any member of its Controlled Group in excess of $500,000.00
in the aggregate with all other liabilities subject to this paragraph (g).
(h) No Borrower will, or will permit any member of its Controlled
Group to, cause or suffer to exist a COBRA Violation with respect to any Plan to
which such continuation coverage requirements apply if the violation(s) could
result in a liability in excess of $500,000.00 in the aggregate.
6.7 RIGHT OF INSPECTION. Each Borrower shall, at any reasonable time and
from time to time, and upon reasonable advance notice (but no advance notice
shall be required if a Default or an Event of Default shall then exist), permit
the Administrative Agent, the Issuer or any Lender or any agent or
representative thereof, to examine and make copies and abstracts from the
records and books of account of, and visit and inspect the properties of, any
Borrower, and to discuss the affairs, finances and accounts of such
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Borrower with any of its officers, directors and independent accountants.
6.8 INSURANCE. Each Borrower shall maintain with financially sound and
reputable insurers insurance with respect to its properties and business and
against such liabilities, casualties and contingencies and of such types and in
such amounts as are customary in the case of Persons engaged in the same or
similar businesses or having similar properties similarly situated, including
insurance covering its respective properties, buildings, machinery, equipment,
tools, furniture, fixtures and operations, and medical malpractice, professional
liability and public liability, as well as business interruption. The Borrowers
shall have the Administrative Agent named to receive certificates evidencing
such insurance annually at least thirty days prior to the anniversary date of
such insurance policies and any other time requested by the Administrative
Agent.
6.9 PAYMENT OF TAXES AND OTHER CHARGES. Each Borrower shall
(a) on or prior to the date on which penalties attach thereto, pay
all taxes, assessments and other governmental charges imposed upon it or any of
its properties; and
(b) on or prior to the date when due, pay all lawful claims of
materialmen, mechanics, carriers, warehousemen, landlords and other like Persons
and all other lawful claims which, in each case if unpaid, might result in the
creation of a Lien upon any of its properties, provided that unless and until
foreclosure, distraint, levy, sale or similar proceedings shall have been
commenced, such Borrower need not pay or discharge any such tax, assessment,
charge or claim so long as (x) the validity thereof is being contested in good
faith and by appropriate proceedings diligently conducted and (y) such reserves
or other appropriate provisions as may be required by GAAP shall have been made
therefor.
6.10 SUBSIDIARIES TO BE BORROWERS.
(a) Each Borrower shall cause all of its Subsidiaries, other than
Excluded Subsidiaries, at all times to be Borrowers hereunder (by signing
Joinder Supplements hereto, executing Notes or allonges thereto and taking such
other action as the Administrative Agent may reasonably request) and cause all
the capital stock or other equity interests in such Subsidiaries owned by
Borrowers, other than capital stock or other equity interests in Excluded
Subsidiaries, and all notes or other rights to receive payment from another
Borrower to be pledged to the Administrative Agent for the benefit of the
Secured Parties pursuant to the Pledge Agreement. Without limiting the
generality of the foregoing, when the Borrowers are required, in connection with
an Acquisition or otherwise, to cause one or more (direct or indirect)
Subsidiaries of Multicare (each, a "Joining Subsidiary") to become Borrowers
hereunder, then the Borrowers and each such Joining Subsidiary shall take the
actions set forth on Schedule 6.10, in the case of the formation of a new
Subsidiary, promptly upon such formation, and in the case of the acquisition of
an entity which shall become a Subsidiary, no later than the date of the
consummation of the relevant Acquisition.
(b) With the prior written consent of the Administrative Agent,
Multicare (on behalf of the Borrowers) may from time to time redesignate one or
more Subsidiaries
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which are designated as Excluded Subsidiaries on Schedule 11.1 to be Borrowers
and Restricted Subsidiaries hereunder, Pledgors under the Pledge Agreement and
comparable parties under the other Loan Documents (and not Excluded
Subsidiaries). Thereupon and upon satisfaction of the requirements set forth in
paragraph (a) above for Joining Subsidiaries, such redesignated Subsidiaries
shall be Borrowers hereunder, Pledgors under the Pledge Agreement and comparable
parties to the other Loan Documents. The Administrative Agent shall give the
Lenders notice of any such redesignation.
6.11 PRESERVATION OF STATUS AS SENIOR INDEBTEDNESS. The Borrowers shall
comply with the terms of the 1997 Subordinated Note Indenture. Each Borrower
shall promptly take or cause Genesis to take, as appropriate, all action
necessary or requested by the Administrative Agent at any time to protect,
preserve and give effect to the status of the Loan Obligations as "Senior
Indebtedness" and "Designated Senior Indebtedness" within the meaning of the
1995 Subordinated Note Indenture and the 1996 Subordinated Note Indenture, if
and when applicable to Multicare or the other Borrowers as set forth in Section
5.1(w), and the 1997 Subordinated Note Indenture.
6.12 INTEREST RATE HEDGING AGREEMENTS. At all times from and after ninety
(90) days after the Closing Date, the Borrowers shall maintain one or more
Interest Rate Hedging Agreements to the extent necessary to ensure that at all
times at least fifty percent (50%) of the Total Funded Indebtedness of the
Borrowers effectively bears, or is capped at, a fixed interest rate provided,
however, that no Borrower shall enter into any rate swap, cap or collar
agreement which is not an Interest Rate Hedging Agreement.
6.13 CORPORATE SEPARATENESS. Each Borrower shall observe all requirements
necessary to cause it to be treated as a separate legal entity for all purposes
under applicable corporate law. Without limiting the foregoing requirement, each
Borrower specifically shall (i) maintain and cause each Excluded Subsidiary to
maintain separate corporate and financial records and observing all corporate
formalities; (ii) maintain, and cause each Excluded Subsidiary to maintain,
capitalization adequate to meet its business needs; (iii) cause all reports,
filings and public information to refer to such Borrower or Excluded Subsidiary,
as the case may be, as a separate company (and not a division of each other);
and (iv) otherwise conduct and cause each Excluded Subsidiary to conduct, its
dealings with third parties in its own name and as a separate and independent
entity. Without limiting the generality of the foregoing, except as expressly
permitted or required elsewhere by this Agreement or unless specifically agreed
to by the Required Lenders, no Borrower may enter into any merger or other
combination with or transfer assets to any of the Genesis Group or any Excluded
Subsidiary, or make any loan to, advance to, or other investment in any of the
Genesis Group or any Excluded Subsidiary, or guarantee any Indebtedness or
otherwise be liable for obligations of any of the Genesis Group or any Excluded
Subsidiary, provided, nothing in this Section 6.13 shall prohibit the execution
and delivery of the Multicare Management Agreement or the Tax Sharing Agreement,
or the transactions contemplated thereby. Notwithstanding the foregoing, the
Borrowers may make such Investments in, borrow money from, and carry on other
transactions with, Excluded Subsidiaries on an arm's length basis to the extent
that this Agreement permits the Borrowers to carry on such activities with
unrelated third parties.
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6.14 TRANSACTIONS WITH AFFILIATES. Each Borrower shall effect all
transactions with Affiliates (excluding transactions with other Borrowers) on a
basis at least as favorable to such Borrower as would at the time be obtainable
for a comparable transaction on an arm's length dealing with an unrelated third
party, except that this Section 6.14 shall not apply to (a) the Tax Sharing
Agreement, (b) the Transaction Documents, or (c) transaction fees and expenses
payable to Genesis, Cypress and TPG within seven days of the Closing Date, to
the extent such are permitted by the 1997 Subordinated Note Indenture.
6.15 CASH PROCEEDS OF EQUITY OF SURETY. The Borrowers shall cause the
Surety to contribute to Multicare any cash proceeds of equity or other capital
contributions raised by Surety.
6.16 CAPITAL STOCK. The Capital Stock of Multicare shall be owned at all
times by Surety, subject to no Liens, except those in favor of the
Administrative Agent for the benefit of the Secured Parties pursuant to the
terms of the Pledge Agreement. At no time shall any equity interest in any
Restricted Subsidiary be owned by any Excluded Subsidiary.
6.17 USE OF PROCEEDS. The Borrowers will apply the proceeds of the Loans
only (i) to refinance all of the existing Indebtedness of Multicare and its
Subsidiaries (including without limitation Indebtedness acquired by Multicare as
a result of its merger with Acquisition Corp.) except Indebtedness identified on
Schedule 8.1 hereto, (ii) to fund working capital and Capital Expenditure needs,
subject to the other limitations set forth in this Agreement, (iii) to fund
interest and principal payments on the Loans and other permitted Indebtedness,
(iv) to pay (as a result of the merger of Acquisition Corp. into Multicare) the
consideration to former shareholders of Multicare who did not tender their
shares in the Tender Offer, (v) to pay transaction costs resulting from the
Tender Offer and the merger of Acquisition Corp. into Multicare, and (vi) for
general corporate purposes.
6.18 CERTAIN DISPOSITIONS. On or before December 31, 1997, the Borrowers
shall sell to Genesis and/or one or more of its Subsidiaries (other than Surety
or Multicare or any Subsidiary of either of them) their contract therapy
business for a cash purchase price of approximately $24,000,000.00 and their
institutional pharmacy business for a cash purchase price of approximately
$50,000,000.00, each on terms and conditions satisfactory to the Agents.
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ARTICLE 7
FINANCIAL COVENANTS
7.1 CERTAIN FINANCIAL COVENANTS. So long as any Loan Obligations shall
remain unpaid or any Lender has any Commitment under this Agreement, the
Borrowers shall comply with the following financial covenants.
(a) Fixed Charge Coverage. The Fixed Charge Coverage Ratio shall be
at least equal to the ratios set forth below during the periods indicated below:
Period Ratio
------ -----
9/30/97 through 6/30/99 1.20
7/01/99 through 9/30/01 1.25
10/01/01 through 9/30/02 1.30
10/01/02 and thereafter 1.35
(b) Consolidated Net Worth. The total amount of stockholders' equity
of Multicare and the Restricted Subsidiaries, on a consolidated basis, at any
date of determination after the Agreement Date shall be not less than the sum of
(i) Six Hundred Eighty Five Million Dollars ($685,000,000.00)
plus
(ii) an amount equal to the sum of:
(A) an amount equal to the net proceeds of all
equity offerings of Surety on a cumulative basis
commencing on the Agreement Date through such date of
determination, plus
(B) 75% of the cumulative amount of Net Income
(which shall not be reduced by the amount of any net
loss for any fiscal quarter) of Multicare and its
Restricted Subsidiaries, on a consolidated basis, for
the period commencing on the first day of the fiscal
quarter in which the Agreement Date occurs through the
last day of the fiscal quarter ending on, or most
recently prior to, such date of determination, plus
(C) any reduction in the amount of debt of
Multicare and its Restricted Subsidiaries as a result of
the conversion of convertible debt securities into
equity (excluding Multicare's Convertible Subordinated
7% Debentures).
(c) Adjusted Total Debt/Cash Flow. The Adjusted Total Debt/Cash Flow
Ratio shall be not greater than the ratios set forth below during the periods
indicated below:
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Period Ratio
------ -----
9/30/97 through 9/30/98 6.50
10/01/98 through 9/30/99 5.75
10/01/99 through 9/30/00 5.25
10/01/00 and thereafter 4.50
(d) Adjusted Senior Debt/Cash Flow. The Adjusted Senior Debt/Cash
Flow Ratio shall be not greater than the ratios set forth below during the
periods indicated below:
Period Ratio
------ -----
9/30/97 through 9/30/98 4.50
10/01/98 through 9/30/99 4.00
10/01/99 and thereafter 3.50
7.2 CALCULATION OF FINANCIAL COVENANTS. The financial covenants set forth
in this Article 7 shall be maintained continuously and shall be tested at the
end of each fiscal quarter and at such other times as may be required by the
terms of this Agreement. Following the effective date of any Acquisition that is
effected by Multicare or any of its Restricted Subsidiaries and that is
permitted under Section 8.4 hereof (Acquisitions Etc.) the financial covenants
set forth in this Article 7 shall be computed on a pro forma basis as if the
effective date of such Acquisition had been the first day of the earliest of the
four fiscal quarters ended on, or most recently prior to, such actual date of
the Acquisition. For purposes of such computation, the Borrowers may elect to
make pro forma income statement adjustments at the time of the effective date of
such Acquisition under the following circumstances: (i) adjustments to reflect
the elimination of that portion of salary and employee benefit expenses that
will no longer be incurred after the Acquisition, to the extent demonstrated by
Multicare to the satisfaction of the Administrative Agent, and (ii) adjustments
to reflect any other savings in expenses which will be realized by such Person
so acquired as a consequence of such Acquisition, to the extent demonstrated by
Multicare to the satisfaction of the Administrative Agent. Following the
effective date of any disposition that is effected by Multicare or any of its
Restricted Subsidiaries and that is permitted under Section 8.5 hereof
(Dispositions), the financial covenants set forth in this Article 7 shall be
computed on a pro forma basis as if the effective date of such disposition had
been the first day of the earliest of the four fiscal quarters ended on, or most
recently prior to, such actual date of disposition. Following the Closing Date,
the financial covenants set forth in this Article 7 shall be computed on a pro
forma basis as if all transactions in connection with the Transaction Documents
had been consummated, including as if the Multicare Management Agreement had
been in effect since the first day of the earliest of the four fiscal quarters
ended on, or most recently prior to, the Closing Date. Unless otherwise agreed
to by the Required Lenders, the financial condition and results of operations of
the Excluded Subsidiaries shall not be combined with those of the Borrowers for
purposes of calculating the financial covenants set forth in this Article 7.
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ARTICLE 8
NEGATIVE COVENANTS
So long as any Loan Obligations shall remain unpaid or any Lender or the
Issuer shall have any Commitment under this Agreement, each of the Borrowers
shall comply with the following covenants.
8.1 INDEBTEDNESS. No Borrower shall, nor shall any Borrower permit Surety
to, at any time, create, incur, assume or suffer to exist any Indebtedness
(including any Guaranties, Capitalized Leases or Assumed Indebtedness), except:
(a) Indebtedness to the Lender Parties pursuant to this Agreement
and the other Loan Documents;
(b) Indebtedness constituting intercompany (i.e. inter-Borrower)
loans and advances evidenced by promissory notes duly pledged to the
Administrative Agent for the benefit of the Secured Parties pursuant to the
terms of the Pledge Agreement;
(c) Obligations of Multicare under Interest Rate Hedging Agreements
entered into pursuant to Section 6.12 hereof;
(d) Indebtedness (including the indebtedness under the 1997
Subordinated Notes) existing on the Closing Date acceptable to the Agents and
described on Schedule 8.1 hereto, which sets forth certain Indebtedness in a
principal amount not exceeding $300,000,000.00; and any extensions, renewals,
refinancing of the same so long as such extensions, renewals and refinancing (i)
are in a principal amount no greater than the amount the Indebtedness so
extended, renewed or refinanced, (ii) have maturity dates (and amortization
schedules) no earlier than the debt being refinanced, (iii) are incurred
pursuant to agreements or instruments which do not prohibit the Indebtedness or
Liens created pursuant to the Loan Documents or otherwise conflict with the
terms of the Loan Documents or contain terms and conditions which are more
onerous than the terms and conditions in the existing agreements and
instruments, (iv) are not made at a time that a Default or Event of Default has
occurred and is continuing or would be caused thereby, and (v) in the case of
any extension, renewal or refinancing of the 1997 Subordinated Notes, or, if and
when applicable as set forth in Section 5.1(w), the 1995 Subordinated Notes or
the 1996 Subordinated Notes, has subordination provisions at least as favorable
to the senior lenders as those set forth in the agreement refinanced or extended
and generally be in terms acceptable to the Administrative Agent;
(e) With respect to the Borrowers (but not the Surety) other
Indebtedness incurred from time to time, in an aggregate outstanding principal
amount not to exceed Fifteen Million Dollars ($15,000,000.00) at any time so
long as such Indebtedness is incurred pursuant to agreements or instruments
which do not cause a Default or Event of Default hereunder, which contain terms
and conditions no more onerous than the terms and conditions hereof and which do
not mature, or have principal amortization prior to, the Maturity Date;
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(f) With respect to the Borrowers (but not the Surety), Indebtedness
in an aggregate amount not to exceed $20,000,000.00 incurred to finance the
construction of the assisted living facilities identified on Schedule 8.1(f)
attached hereto, provided that the Borrowers' obligations with respect to such
Indebtedness shall be terminated in connection with the disposition of such
facilities, as contemplated in Section 8.5 (Disposition) hereto.
(g) Provided that the terms of this Agreement and the consummation
of the transactions contemplated hereby and by the Transaction Documents are
consistent with, and do not cause a default under, Multicare's Convertible
Subordinated 7% Debentures or the Indenture under which they were issued,
Indebtedness evidenced by Multicare's Convertible Subordinated 7% Debentures in
the original principal amount of $86,250,000.00 of which no more than
$39,424,000.00 in principal amount shall remain outstanding as of the Closing
Date, provided that the Borrowers shall cause all such Indebtedness to be
redeemed or converted, and all shares of stock received on conversion or
redeemed, by no later than March 16, 1998, at an aggregate cost to the Borrowers
(including amounts expended prior to, on and after the Closing Date) not to
exceed $122,000,000.00 plus interest to the date of redemption;
(h) Provided that the terms of this Agreement and the consummation
of the transactions contemplated hereby and by the Transaction Documents are
consistent with, and do not cause a default under, Multicare's Senior
Subordinated 12-1/2% Notes on the Indenture under which they were issued,
Indebtedness evidenced by Multicare's Senior Subordinated 12-1/2% Notes in the
original principal amount of $100,000,000.00, of which no more than $75,000.00
in principal amount shall remain outstanding as of the Closing Date provided
that the Borrowers shall cause all such Indebtedness to be repaid by no later
than January 2, 1998, at an aggregate cost to the Borrowers (including amounts
expended prior to, on and after the Closing Date) not to exceed $26,000,000.00
plus interest through the redemption date;
provided, however, that all Indebtedness incurred pursuant to paragraph (e)
above shall be subject to the following: (i) it shall be incurred on terms which
do not prohibit the Indebtedness created pursuant to the Loan Documents, or
otherwise conflict with the terms hereof or the other Loan Documents; (ii) at
the time such Indebtedness is incurred, no Default or Event of Default shall
have occurred and be continuing or shall be caused or created thereby; (iii)
prior to the incurrence of such Indebtedness, Multicare (on behalf of the
Borrowers) shall deliver to the Administrative Agent a certificate of a
Responsible Officer of Multicare (A) stating the amount of such Indebtedness,
(B) containing a representation that such Indebtedness was incurred in
compliance with the provisions of this Section 8.1 and showing calculations
thereof, and (C) containing a representation that such Indebtedness was incurred
in compliance with the financial covenants set forth herein, in Section 5.9 of
the 1995 Subordinated Note Indenture and in Section 5.9 of the 1996 Subordinated
Note Indenture, if and when applicable to Multicare as set forth in Section
5.1(w), and the 1997 Subordinated Note Indenture and showing calculations
thereof; (iv) the terms of the instruments and agreements respecting such
Indebtedness shall be no more restrictive than the terms of this Agreement; and
(v) the instruments and agreements respecting such Indebtedness shall not
contain provisions that would violate the terms of Section 8.12 (Limitation on
Certain Restrictive Provisions) below.
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8.2 LIENS. No Borrower shall, nor shall any Borrower permit Surety to, at
any time create, incur, assume or suffer to exist any Lien on any of its assets
or assets of the Surety (now owned or hereafter acquired), except for the
following ("Permitted Liens"):
(a) Liens pursuant to the Loan Documents;
(b) Liens acceptable to the Agents and existing on the Closing Date
securing obligations existing on the Closing Date, which Liens and obligations
are listed on Schedule 8.2 hereto (and any extension, renewal and replacement
Liens upon the same property theretofore subject to a listed Lien, provided that
(i) the amount secured by each Lien constituting such an extension, renewal or
replacement Lien shall not exceed the amount secured by the corresponding Lien
theretofore existing and (ii) such replacement Liens are incurred pursuant to
agreements or instruments which do not prohibit the Liens or Indebtedness
created pursuant to the Loan Documents or otherwise conflict with the terms of
the Loan Documents);
(c) Liens arising from taxes, assessments, charges or claims
described in Section 6.9 hereof to the extent permitted by said Section 6.9,
provided that the aggregate amount secured by all Liens described in this clause
(c) shall not at any time exceed $500,000.00;
(d) Liens existing on real estate and equipment acquired by any
Borrower in an Acquisition permitted under Section 8.4 hereof so long as any
such Lien secures only the corresponding Assumed Indebtedness permitted under
clause (e) of Section 8.1, above;
(e) With respect to the Borrowers (but not the Surety) other (i)
purchase money Liens encumbering only the property purchased with the proceeds
from the corresponding Indebtedness, and (ii) Capitalized Leases, in each case
securing Indebtedness permitted under clause (e) of Section 8.1 above;
(f) Other Liens (other than on Collateral) securing Indebtedness
incurred pursuant to paragraph (f) of Section 8.1 above in an amount not to
exceed $20,000,000.00 in the aggregate;
(g) Liens in respect of property or assets of the Borrowers imposed
by law which were incurred in the ordinary course of business, such as
carriers', warehousemen's and mechanics' Liens, statutory landlord's Liens, and
other similar Liens arising in the ordinary course of business, and (i) which do
not in the aggregate materially detract from the value of such property or
assets or materially impair the use thereof in the operation of the business of
the Borrowers taken as a whole or (ii) which are being contested in good faith
by appropriate proceedings, which proceedings have the effect of preventing the
forfeiture or sale of the property or asset subject to such lien and that
adequate reserves have been set aside on the applicable Borrower's books to
protect against an adverse result;
(h) Liens arising from judgments, decrees or attachments and Liens
securing appeal bonds arising from judgments, in each case in circumstances not
constituting an Event of Default under Section 9.1(g);
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(i) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, performance and return-of-money bonds
and other similar obligations incurred in the ordinary course of business
(exclusive of obligations in respect of the payment for borrowed money); and
(j) easements, rights-of-way, restrictions, minor defects or
irregularities in title to real property and other similar charges or
encumbrances on real property not interfering in any material respect with the
ordinary conduct of the business of the Borrowers taken as a whole or the value
or salability of the assets so encumbered or affecting their use for their
intended purposes;
provided, however, that no Lien permitted under clauses (d), (e) or (f) above
shall be created at any time, if there shall exist, either before or after
giving effect to such transaction, a Default or an Event of Default. "Permitted
Liens" shall in no event include any Lien imposed by, or required to be granted
pursuant to, ERISA or any Environmental Law.
8.3 LOANS, ADVANCES AND INVESTMENTS. No Borrower shall, nor shall any
Borrower permit Surety to, at any time (i) make or suffer to exist any loan or
advance to, or (ii) purchase, acquire or own (beneficially or of record) any
stock, bonds, notes or securities of, or any partnership interest (whether
general or limited) in, or any other interest in, or (iii) make any capital
contribution to, or other investment in (collectively, "Investments") any other
Person, except:
(a) receivables owing to such Borrower arising from provision of
services or sales of inventory under usual and customary terms in the ordinary
course of business; and loans and advances extended by a Borrower to
subcontractors or suppliers under usual and customary terms in the ordinary
course of business;
(b) (i) loans or advances from Multicare to a wholly-owned
Restricted Subsidiary of Multicare or (ii) loans from a wholly-owned Restricted
Subsidiary of Multicare to Multicare or another wholly-owned Restricted
Subsidiary of Multicare, provided, however, all such loans and advances shall be
evidenced by promissory notes duly pledged to the Administrative Agent for the
benefit of the Secured Parties pursuant to the Pledge Agreement;
(c) the capital stock or other ownership interests in other
Borrowers duly pledged to the Administrative Agent, for the benefit of the
Secured Parties;
(d) Cash Equivalent Investments;
(e) Acquisitions permitted under Section 8.4 (Acquisitions, Etc.)
below;
(f) the Surety's initial Investment in the capital stock of
Acquisition Corp.;
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(g) the capital stock or other ownership interests in the Excluded
Subsidiaries existing on the Closing Date and set forth on Schedule 11.1 hereto;
(h) Investments existing on the Closing Date in an amount not
greater than $20,050,000.00 which are listed on Schedule 8.3 hereto; and
(i) With respect to the Borrowers (but not the Surety) other
Investments not covered by clauses (a) through (h) of this Section 8.3 provided,
that
(1) at the time that any Investment is made, the aggregate
amount (which shall include all existing amounts and all new
commitments therefor) of all Investments pursuant to this paragraph
(i) shall not exceed $15,000,000.00; and
(2) no Default or Event of Default shall then exist either
before or after giving effect to such transaction.
Investments referred to in paragraph (h) which are existing on the Closing Date
and the amount of each such Investment are listed on Schedule 8.3 hereto. On or
before (if practicable) but in any event within 5 days after any Investment is
made pursuant to the preceding paragraph (i), Multicare (on behalf of the
Borrowers) shall deliver to the Administrative Agent a supplement to Schedule
8.3 showing the proposed Investment, together with a certificate of a
Responsible Officer of Multicare stating that such Investment was made in
compliance with this Section 8.3 and in compliance with the provisions of the
1997 Subordinated Note Indenture. The "amount" of any Investment referred to in
this Section 8.3 shall mean the sum of the following (without duplication): the
amount of cash paid for or contributed to such Investment; the fair market value
of any equity or assets constituting consideration for or contributed to such
Investment; and any commitment to pay, contribute, incur, or become liable for
any of the foregoing.
8.4 ACQUISITIONS, ETC. No Borrower shall engage, or permit the Surety to
engage, in any Acquisition (other than an acquisition of assets in the ordinary
course of business) except:
(a) A Borrower may merge with or into Multicare or any direct or
indirect wholly-owned Restricted Subsidiary of Multicare, provided that
(i) if Multicare is a party to the merger, it is the surviving entity and
(ii) if Multicare is not a party to the merger, a wholly-owned Restricted
Subsidiary of Multicare is the surviving entity and provided, further,
that no Event of Default or Default shall occur and be continuing before
or after giving effect to such transaction; and
(b) So long as no Default or Event of Default has occurred or would
exist after giving effect to such Acquisition, any Borrower may make an
Acquisition not covered by clause (a) of this Section 8.4, provided,
however, that (i) the Acquisition Cost of all Acquisitions made pursuant
to this paragraph (b) does not exceed $15,000,000.00 in any fiscal year,
provided, that if the Adjusted Total Debt/Cash Flow Ratio is, and has been
for two consecutive fiscal quarters, less than or equal to 4.5 to 1.0,
then the Acquisition Cost of all Acquisitions pursuant to this paragraph
(b)
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shall not exceed $25,000,000.00 in any fiscal year and (ii) the
"Acquisition Conditions" set forth on Schedule 8.4 hereto shall have been
satisfied.
8.5 DISPOSITIONS. No Borrower shall, or shall permit Surety to, sell,
convey, assign, lease as lessor, transfer, abandon or otherwise dispose of
(collectively, for purposes of this Section 8.5, "transfer"), voluntarily or
involuntarily, any of its assets, except:
(a) A Borrower may sell inventory in the ordinary course of
business;
(b) A Borrower may dispose of equipment which is obsolete or no
longer useful in its business;
(c) A Borrower may transfer its properties to Multicare or a
wholly-owned Restricted Subsidiary of Multicare so long as no Event of
Default or Default shall exist either before or after giving effect to
such transfer;
(d) Subject to mandatory prepayment provisions set forth above, the
Borrowers may transfer at any time the facilities identified on Schedule
8.5(d) located in the states of Ohio, Wisconsin or Illinois (i) for a cash
price or (ii) in connection with a swap of assets of the same type and
generating cash flow at approximately the same level, or greater, than the
facilities identified in Schedule 8.5(d) being transferred, as certified
by a Responsible Officer of Multicare, on behalf of the Borrowers, in
writing prior to such transfer with such detail and supporting financing
information as the Administrative Agent may require; provided that in the
case of either (i) or (ii) above the Board of Directors of Multicare
determines that the fair market value in either case is equal to the fair
market value in an arm's length transaction with an unrelated third party
and such transfer is on such terms as are (A) reflective of market
conditions at the time of sale, (B) consistent with the terms of this
Agreement, and (C) satisfactory to the Administrative Agent.
(e) The Borrowers may grant Liens permitted under Section 8.2
(Liens);
(f) Subject to mandatory prepayment provisions set forth above, the
Borrowers shall make the dispositions described in Section 6.18 above;
(g) Subject to mandatory prepayment provisions set forth above, the
Borrowers may transfer the assisted living facilities described in
Schedule 8.1(f) attached hereto to a Person who is not a Borrower for a
sales price at least sufficient to repay any Indebtedness associated
therewith provided that the Cash Flow for the immediately preceding four
fiscal quarters for such facilities (and if such facilities have not been
in operation for four fiscal quarters, then such Cash Flow for the period
since operations commenced on an annualized basis) does not exceed 15% of
the associated Indebtedness;
(h) Subject to mandatory prepayment provisions set forth above, so
long as no Default or Event of Default has occurred or would exist after
giving effect to such transfer, a Borrower may transfer other assets
(including ownership interests in Restricted Subsidiaries) provided,
however, that (i) the "Disposition Conditions" set
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forth on Schedule 8.5(h) hereto shall have been satisfied and (ii) both of
the following financial tests shall be satisfied:
(A) The sum of the aggregate fair market value of the property
subject to such proposed transfer plus the aggregate fair
market value of all property previously transferred pursuant
to this paragraph (h) at any time after the Closing Date (in
each case determined as of the date of transfer or proposed
transfer, as the case may be) is less than an amount equal to
5% of the total assets of Multicare and its Restricted
Subsidiaries, on a consolidated basis, determined as of the
fiscal quarter ending on, or most recently prior to, the date
of the proposed transfer; and
(B) The sum of the amount of Cash Flow attributable to the
property subject to such proposed transfer plus the amount of
Cash Flow attributable to all property previously transferred
pursuant to this paragraph (h) at any time after the Closing
Date ( in each case for the four fiscal quarters ended on, or
most recently prior to, the date of the transfer or proposed
transfer, as the case may be) is less than an amount equal to
5% of the Cash Flow of Multicare and its Restricted
Subsidiaries, on a consolidated basis, for the four fiscal
quarters ending on, or most recently prior to, the date of the
proposed transfer.
(i) Subject to mandatory prepayment provisions set forth
above, so long as no Default or Event of Default has
occurred or would exist after giving effect to such
transfer, any Borrower may transfer its interests in
Excluded Subsidiaries.
8.6 ISSUANCE OF SUBSIDIARY STOCK OR OTHER OWNERSHIP INTERESTS. The
Borrowers shall not, and shall not permit the Surety to, create, acquire,
dispose of, or change any interest in any Restricted Subsidiary except as
follows:
(a) Restricted Subsidiaries of Borrowers (or any interest therein)
may be created or acquired in connection with an Acquisition to the extent
permitted under Section 8.4 above (Acquisitions, Etc.);
(b) Restricted Subsidiaries of Borrowers (or any interest therein)
may be created or acquired in connection with an Investment to the extent
permitted under Section 8.3 above (Loans, Advances and Investments);
(c) Restricted Subsidiaries of Borrowers may be created as
wholly-owned direct or indirect Restricted Subsidiaries of Multicare for
other purposes consistent with the terms of this Agreement; and
(d) Restricted Subsidiaries (or any interest therein) may be
disposed of pursuant to the provisions of Section 8.5 above
(Dispositions);
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provided, however, that with respect to Restricted Subsidiaries created or
acquired in accordance with paragraphs (a), (b) or (c) above, they shall become
"Borrowers" hereunder and corresponding parties to the other Loan Documents,
their equity owned by Borrowers shall be pledged to the Administrative Agent,
for the benefit of the Secured Parties, pursuant to the Pledge Agreement (all as
more fully set forth in Section 6.10 above) and they shall become parties to the
Tax Sharing Agreement.
8.7 LEASES. The Borrowers shall not, and shall not permit the Surety to,
at any time, enter into or suffer to remain in effect any lease, as lessee, of
any property, except:
(a) Leases (including subleases) by Multicare or a wholly-owned
Restricted Subsidiary of Multicare as lessor (or sublessor) to Multicare
or another wholly-owned Restricted Subsidiary of Multicare as lessee (or
sublessee);
(b) Capitalized Leases permitted under Section 8.1 above; and
(c) Other leases which are not Capitalized Leases or Synthetic
Leases but only to the extent that the aggregate Rental Expense of the
Surety, the Borrowers with respect to all such other leases does not
exceed (i) during the fiscal year ending December 31, 1997, $15,000,000.00
and (ii) during each fiscal year thereafter, an amount equal to the amount
permitted in the preceding year plus an additional $2,000,000.00 (e.g.,
$17,000,000.00 in the fiscal year ending December 31, 1998.)
8.8 DIVIDENDS AND RELATED DISTRIBUTIONS. Except for dividends from
Multicare to Surety in an amount necessary to permit Surety to pay its taxes and
general corporate operating expenses of the type typically incurred by a
corporation whose only assets are the stock of operating companies with no other
business activity, Multicare shall not, and the Borrowers shall not permit the
Surety to, (a) declare or pay any dividends, (b) purchase, redeem, retire or
otherwise acquire for value any of its capital stock now or hereafter
outstanding, or (c) make any distribution of assets to its stockholders as such
whether in cash, assets or obligations of Multicare or the Surety, (d) allocate
or otherwise set apart any sum for the payment of any dividend or distribution
on, or for the purchase, redemption or retirement of, any shares of its capital
stock, or (e) make any other distribution by return of capital or otherwise in
respect of any shares of its capital stock except that Multicare and the Surety
may each declare and pay dividends and make distributions payable solely in its
common stock, or options, warrants or other rights to purchase common stock,
provided that any such stock, warrants, options or other rights (other than such
as are issued by Surety to Cypress, Nazem or TPG) are pledged to the
Administrative Agent for the benefit of the Secured Parties pursuant to the
Pledge Agreement.
8.9 CONSOLIDATED TAX RETURN. No Borrower shall (a) file or consent to the
filing of any consolidated income tax return with any Person other than other
Borrowers or other Persons party to the Tax Sharing Agreement or (b) become
party to any tax sharing or tax allocation agreement with any other Person other
than the Tax Sharing Agreement. From and after the effective date of the Tax
Sharing Agreement (which shall be on or about the Closing Date), each of the
Borrowers shall cause the Tax Sharing Agreement to remain in full force and
effect, subject to no amendments or modifications other than (a) joinder of
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additional Subsidiaries of Multicare, from time to time, such that at all times
all Subsidiaries of Multicare shall be parties thereto, and (b) such amendments
or modifications which, individually or in the aggregate, could not reasonably
be expected to have an adverse effect on the Borrowers taken as a whole
(including the business, operations, condition, financial or otherwise,
properties or prospects of the Borrowers), the Loan Documents or any Lender
Party.
8.10 LIMITATION ON PAYMENTS, PREPAYMENTS, DEFEASEMENT AND OTHER ACTION
WITH RESPECT TO CERTAIN DEBT OBLIGATIONS. No Borrower shall, and no Borrower
shall permit Surety to, directly or indirectly, pay, prepay, purchase, defease,
redeem, retire, acquire, or otherwise make any payment (on account of principal,
interest, premium or otherwise) in respect of any obligation under, or evidenced
by the 1997 Subordinated Note Indenture (or cause or allow any event or
condition to exist which would require any payment, prepayment, purchase,
defeasance, redemption, retirement, acquisition or other payment of any such
obligation) except that a Borrower may make cash interest payments on the
aforesaid Indebtedness, as and when required to do so by the mandatory terms
thereof, all to the extent consistent with the subordination provisions
applicable thereto. No Borrower shall, and no Borrower shall permit Surety to,
amend, modify or supplement the terms or provisions contained in the
aforementioned debt agreements or any agreement or instrument evidencing,
relating or applicable thereto. No Borrower shall, and no Borrower shall permit
Surety to, take or omit to take any action under or in connection with, any such
agreement or instrument, which would violate or impair the subordination
provisions thereof. No Borrower will, and no Borrower shall permit Surety to,
make or give any notice that it shall make any voluntary or optional payment or
prepayment or redemption or acquisition for value of, or will refund, refinance
or exchange any Indebtedness (excluding Loan Obligations) if at such time any
Default or Event of Default has occurred and is continuing or would be directly
or indirectly caused as a result thereof. No Loan Party shall designate any of
its Indebtedness as "Designated Senior Indebtedness" for purposes of the 1997
Subordinated Note Indenture except Indebtedness incurred pursuant to this
Agreement, the other Loan Documents, or Qualifying Interest Rate Hedging
Agreements.
8.11 LIMITATIONS ON MODIFICATION OF CERTAIN DOCUMENTS.
(a) Constituent Documents. No Borrower shall, or permit the Surety
to, amend, modify or supplement its articles or certificate of
incorporation, bylaws, partnership agreement or other constituent
documents (i) if a Material Adverse Effect could result from such
amendment, modification or supplement or (ii) if such amendment,
modification or waiver could reasonably be expected to materially
adversely affect the rights or interests of the Agents, the Issuer or the
Lenders.
(b) Transaction Documents. No Borrower shall or permit the Surety
to, amend, modify or supplement any Transaction Document, except for such
amendments, modifications or supplements which could not reasonably be
expected to have an adverse effect on the Borrowers taken as a whole
(including the condition (financial or otherwise), properties or prospects
of the Borrowers), the Loan Documents or any Lender Party.
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8.12 LIMITATION ON CERTAIN RESTRICTIVE PROVISIONS. No Borrower shall, or
shall permit the Surety to, enter into, or remain a party to, any agreement or
instrument which would impose any restriction: (a) on the right of such Person
from time to time to declare and pay dividends or take similar actions with
respect to capital stock owned by such Person or pay any Indebtedness,
obligations or liabilities from time to time owed to another Borrower; or (b)
that would prohibit the grant of any Lien upon any of its properties (now owned
or hereafter acquired) to secure any senior Indebtedness except for restrictions
in agreements respecting Permitted Liens to the extent that the prohibition
applies only to property subject to the Permitted Lien; or (c) would prohibit,
or require the consent of any Person to, any amendment, modification or
supplement to any of the Loan Documents except: (i) restrictions set forth in
the Loan Documents; (ii) legal restrictions of general applicability; and (iii)
restrictions pursuant to the 1997 Subordinated Note Indenture.
8.13 LIMITATIONS ON MERGERS, ETC. No Borrower shall, or permit the Surety
to, merge or consolidate with or into any Person, except (a) mergers of any
Borrower with Multicare where Multicare is the survivor, (b) mergers of any
Restricted Subsidiary of Multicare with any wholly-owned Restricted Subsidiary
of Multicare where such wholly-owned Restricted Subsidiary is the survivor, (c)
any merger pursuant to an Acquisition permitted under Section 8.4 above
(Acquisitions, Etc.) or (d) any merger pursuant to a transfer permitted under
Section 8.5 above (Dispositions).
8.14 AVOIDANCE OF OTHER CONFLICTS. No Borrower shall, or permit the Surety
to, violate or conflict with, be in default under, or be or remain subject to
any liability (contingent or otherwise) on account of any violation or conflict
with (a) its articles or certificate of incorporation, bylaws or partnership
agreement (or other constituent documents), or (b) any agreement or instrument
to which it is party or by which any of its properties (now owned or hereafter
acquired) may be subject or bound, except, with respect to clause (b), for
matters that could not, individually or in the aggregate, have a Material
Adverse Effect.
8.15 CAPITAL EXPENDITURES. No Borrower shall make or commit to make any
Capital Expenditure if, after giving effect to such Capital Expenditure, the
aggregate amount of all Capital Expenditures of the Borrowers incurred (i)
during the fiscal year ending December 31, 1997, would exceed $45,000,000.00,
and (ii) during any fiscal year thereafter, would exceed $35,000,000.00.
8.16 MANAGEMENT FEE. The Borrowers shall not pay management fees under the
Multicare Management Agreement in any fiscal year in an amount less than
$23,900,000.00, or in excess of 6% of the consolidated net revenue of the
Borrowers. All such management fees shall be subordinated to the obligations of
the Borrowers hereunder in accordance with the terms contained in the Multicare
Management Subordination Agreement as in effect on the date hereof. Such
management fees may be accrued but not paid except that such fees may be paid to
the extent they do not exceed in any fiscal year the greater of (a) 4% of the
consolidated net revenue of the Borrowers, and (b) $23,900,000.00. To the
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extent such management fees in any fiscal year (including the payment in such
year of accrued management fees) would exceed the amount specified in the
preceding sentence, such excess amount shall be payable only to the extent that,
both before and after giving effect to such payment, (i) there exists no Event
of Default or Default, (ii) Borrower's Fixed Charge Coverage Ratio shall be not
less than 1.4 for the two most recent completed fiscal quarters of the
Borrowers, and (iii) the Adjusted Total Debt/Cash Flow Ratio for the two most
recently completed fiscal quarters of the Borrowers shall be less than 4.00. No
Borrower shall agree, or permit Surety to agree, with any Person (other than the
Lender Parties) to withhold, defer or change the amount or timing of payments
under the Multicare Management Agreement.
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ARTICLE 9
DEFAULTS
9.1 "EVENTS OF DEFAULT." An Event of Default means any one of the
following events (whatever the reason for such Event of Default, whether it
shall be voluntary or involuntary and whether it shall be by action or inaction,
by operation of law, pursuant to a court order or any rule or regulation of any
Governmental Authority or otherwise):
(a) Failure to Pay Principal or Reimburse Drawings. The Borrowers
shall fail to make any payment of the principal of any Loan on the date when the
same shall become due and payable, whether at stated maturity or at a date fixed
for any installment or prepayment thereof or otherwise; or the Borrowers shall
fail to make any reimbursement of any Drawing under a Letter of Credit or shall
fail to deposit any amount into the cash collateral account, in either case, at
the times and in the amounts specified in Article 3 above.
(b) Failure to Pay Interest, Fees and Other Amounts. The Borrowers
shall fail to make any payment of interest on any Loan or shall fail to pay any
fees or any other amounts owing hereunder or under any other Loan Documents
(other than as specified in paragraph (a) above) on the dates when such
interest, fees or other amounts shall become due and payable and such failure
continues for more than three (3) Business Days.
(c) Covenant Defaults. (i) There shall occur a default in the due
performance or observance of any term, covenant or agreement to be performed or
observed pursuant to any of Sections 6.1(f)(ii), 6.2, 6.3, 6.7, 6.10, 6.11, 6.14
or 6.17 or any Section of Article 7 or any Section of Article 8.
(ii) There shall occur any default in the due performance or
observance of any term, covenant or agreement to be performed or observed
pursuant to the provisions of this Agreement (other than as provided in
paragraph (a) or paragraph (b) above or subparagraph (i) of this paragraph (c))
and, if capable of being remedied, such default shall continue unremedied for
thirty (30) days after any Borrower becomes aware, or should in the exercise of
reasonable diligence have become aware, of such default.
(d) Misrepresentation. Any representation or warranty made or deemed
made by any Loan Party in or pursuant to or in connection with any Loan Document
shall prove to have been false or misleading in any material respect as of the
time when made or deemed made.
(e) Subordinated Debentures. Any "Event of Default" (or similar
term) as defined in the 1997 Subordinated Note Indenture and any other
subordinated indentures to which any Borrower may from time to time be party
shall have occurred and be continuing; or, any term or provision of the
subordination provisions contained in any such indenture shall cease to be in
full force and effect in accordance with its respective terms, or any Loan Party
or any holder of any 1997 Subordinated Note or other subordinated note or other
subordinated obligations (or any trustee or agent on behalf of such holder)
shall terminate,
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repudiate, declare voidable or void or otherwise contest any term or provision
of such subordination provisions; or Multicare shall make, or shall be required
to make or to offer to make, any defeasance, redemption or purchase of 1997
Subordinated Notes under the 1997 Subordinated Note Indenture or Multicare shall
make, or shall be required to make or offer to make, any defeasance, redemption
or purchase of subordinated notes under any similar provision, if any, under any
such other subordinated indentures or other subordinated obligations.
(f) Other Cross-Defaults. (i) Any Loan Party shall fail to pay, in
accordance with its terms and when due and payable, any Indebtedness (other than
Indebtedness referred in paragraph (a) or (e) above) under, or arising out of
any Qualifying Interest Rate Hedging Agreement or an agreement or instrument (or
group or series of related agreements or instruments) which evidences
outstanding Indebtedness in excess of $5,000,000.00; (ii) the maturity of any
such Indebtedness shall, in whole or in part, have been accelerated, or any such
Indebtedness shall, in whole or in part, have been required to be prepaid or
purchased prior to the stated maturity thereof; (iii) any event shall have
occurred and be continuing that permits any holder or holders of such
Indebtedness, any trustee or agent acting on behalf of such holder or holders or
any other Person to accelerate the maturity thereof or require any prepayment or
repurchase thereof; or (iv) a default by any Loan Party shall be continuing
under any other instrument or agreement (whether or not relating to
Indebtedness) binding upon such Person, except a default that, together with all
other such defaults under this clause (iv), could not have a Material Adverse
Effect.
(g) Judgments and Executions. One or more judgments for the payment
of money shall have been entered against any Loan Party or Loan Parties which
judgment or judgments, to the extent not paid or fully covered by insurance,
exceed $1,000,000.00 in the aggregate, and such judgment or judgments shall have
remained undischarged and unstayed for a period of 30 consecutive days; or one
or more writs or warrants of attachment, garnishment, execution, distraint or
similar process or any attachment (prejudgment or otherwise) of assets exceeding
in value the aggregate amount of $1,000,000.00 shall have been issued against
any Loan Party or Loan Parties or any of its or their respective properties.
(h) Invalidity or Noncompliance With Loan Documents. Any of the Loan
Parties shall fail to perform any of its obligations under any of the Loan
Documents (after taking into account any applicable cure period set forth in
such agreements), or the validity of this Agreement or any of the other Loan
Documents, or the subordination provisions of any other instrument or document
intended by the parties hereto to benefit the Lender Parties, shall have been
challenged or disaffirmed by or on behalf of any of the Loan Parties, or any of
the Loan Documents shall cease to be in full force and effect (other than
pursuant to its terms) or, other than as a direct result of any action or
inaction of a Lender Party, any Liens created or intended to be created by any
of the Loan Documents shall at any time cease to be valid and perfected subject
to no equal or prior Liens except Permitted Liens.
(i) Material Adverse Effect. The Required Lenders shall have
determined in good faith that an event or condition has occurred which could
have a Material Adverse Effect.
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(j) Environmental. Any one or more of the events or conditions set
forth in the following clauses (i) or (ii) shall have occurred with respect to
any Borrower or any Loan Party or any of their respective Environmental
Affiliates, and the Required Lenders shall determine in good faith (which
determination shall be conclusive) that such event(s) or condition(s),
individually or in the aggregate, could have a Material Adverse Effect: (i) any
past or present violation of any Environmental Law by such Person which has not
been cured to the satisfaction of the Required Lenders, or (ii) the existence of
any pending or threatened Environmental Claim against any such Person, or the
existence of any past or present acts, omissions, events or circumstances that
could form the basis of any Environmental Claim against any such Person.
(k) Change of Control. A Change of Control shall have occurred; or a
"Change in Control" (as defined in the 1997 Subordinated Note Indenture) shall
have occurred.
(l) Subsidiaries as Loan Parties. Any direct or indirect Subsidiary
of Multicare, other than Excluded Subsidiaries, shall fail to be, or shall cease
to be, or fail to become, a Borrower hereunder; or the equity of any such Person
owned by any Borrower or of Multicare shall cease to be, or fail to be, pledged
under the Pledge Agreement.
(m) Insolvency, Bankruptcy, Etc. Any Loan Party shall make an
assignment for the benefit of creditors or a composition with creditors, shall
generally not be paying its debts as they mature, shall admit its inability to
pay its debts as they mature, shall file a petition in bankruptcy, shall be
adjudicated insolvent or bankrupt, shall petition or apply to any tribunal for
the appointment of any receiver, custodian, liquidator or trustee of or for it
or any substantial part of its property or assets, shall commence any proceeding
relating to it under any bankruptcy, reorganization, arrangement, readjustment
of debt, receivership, dissolution or liquidation law or statute of any
jurisdiction, whether now or hereafter in effect; or there shall be commenced
against such Loan Party, any such proceeding and the same shall not be dismissed
within thirty (30) days or an order, judgment or decree approving the petition
in any such proceeding shall be entered against such Loan Party; or any Loan
Party shall by any act or failure to act indicate its consent to, approval of or
acquiescence in, any such proceeding or any appointment of any receiver,
custodian, liquidator or trustee of or for it or for any substantial part of its
property or assets, or shall suffer the appointment of any receiver, liquidator
or trustee, or shall take any corporate action for the purpose of effecting any
of the foregoing; or any court of competent jurisdiction shall assume
jurisdiction with respect to any such proceeding and the same shall not be
dismissed within thirty (30) days or a receiver or a trustee or other officer or
representative of a court or of creditors, or any court, governmental office or
agency, shall, under color of legal authority, take and hold possession of any
substantial part of the property or assets of such Loan Party and shall not have
relinquished possession within thirty (30) days, or such Loan Party shall have
concealed, removed, or permitted to be concealed or removed, any part of its
property, with intent to hinder, delay or defraud its creditors, or any of them,
or any Loan Party shall have suffered or permitted, while insolvent, any
creditor to obtain a Lien upon any of its property through legal proceedings or
distraint.
(n) Termination of Multicare Management Agreement or other
Transaction Documents. Except as permitted by the Required Lenders, (i) the
Multicare Management Agreement shall cease to be in full force and effect or
there shall be any breach by any party
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thereto or a default thereunder, or an amendment, modification or supplement
thereto not permitted by the terms of this Agreement or any notice of
non-renewal or termination thereunder shall have been delivered by any party
thereto, or (ii) any other Transaction Document shall cease to be in full force
and effect (other than by its terms) or there shall be any material breach by
any party thereto or a default thereunder or any such document shall be amended,
modified, restated or supplemented in a manner not expressly permitted by the
terms of this Agreement or (iii) any other Management Agreement of any Borrower
shall be terminated or cease to be renewed or extended or shall be amended,
modified, restated or supplemented if such termination, failure to renew or
extend or amendment, modification, restatement or supplement (either singly or
collectively with all other such events relating to other Management Agreements)
could have a Material Adverse Effect.
(o) Loss of Licenses, Reimbursement Approvals, Etc. There shall be a
Limitation of one or more Licenses or Reimbursement Approvals of any Borrower or
Borrowers or Persons managed by a Borrower or Borrowers and the Required Lenders
shall determine in good faith that such Limitation, individually or collectively
all such Limitations could reasonably be expected to have a Material Adverse
Effect.
9.2 CONSEQUENCES OF AN EVENT OF DEFAULT.
(a) Events of Default in General. If an Event of Default
(other than one specified in paragraph (m) of Section 9.1 (Insolvency,
Bankruptcy, Etc.) hereof) shall occur and be continuing or shall exist, then, in
addition to all other rights and remedies which the Administrative Agent or any
other Lender Party may have hereunder or under any other Loan Document, at law,
in equity or otherwise, the Lenders shall be under no further obligation to make
Loans, the Issuer shall be under no further obligation to issue Letters of
Credit hereunder, and the Administrative Agent may, (and upon the written
request of the Required Lenders, shall), by notice to Multicare (on behalf of
the Borrowers), from time to time do any or all of the following:
(i) Declare the Commitments terminated, whereupon the
Commitments will terminate and any fees hereunder shall be
immediately due and payable without presentment, demand, protest or
further notice of any kind, all of which are hereby waived, and an
action therefor shall immediately accrue.
(ii) Declare the unpaid principal amount of the Loans,
interest accrued thereon and all other Loan Obligations to be
immediately due and payable without presentment, demand, protest or
further notice of any kind, all of which are hereby waived, and an
action therefor shall immediately accrue.
(iii) Direct the Borrowers to pay (and the Borrowers jointly
and severally agree that upon receipt of notice they will pay) to
the Administrative Agent cash for deposit to the credit of the
Letter of Credit collateral account in accordance with Article 3
hereof.
(iv) Take (or direct the Collateral Agent to take) any and all
actions permitted under the Pledge Agreement or other Loan
Documents.
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(v) Exercise such other remedies as may be available to the
Lender Parties under applicable Law.
(b) Automatic Acceleration; Certain Bankruptcy-Related Events.
If an Event of Default specified in paragraph (m) of Section 9.1 (Insolvency,
Bankruptcy, Etc.) hereof shall occur or exist, then, in addition to all other
rights and remedies which any Lender Party may have hereunder or under any other
Loan Document, at law, in equity or otherwise, the Commitments shall
automatically terminate and the Lenders shall be under no further obligation to
make Loans and the Issuer shall be under no further obligation to issue Letters
of Credit hereunder, and the unpaid principal amount of the Loans, interest
accrued thereon and all other Loan Obligations including those referred to in
clause (iii) of the preceding paragraph (a), shall become immediately due and
payable without presentment, demand, protest or notice of any kind, all of which
are hereby waived, and an action therefor shall immediately accrue, and in
addition, the Administrative Agent may, (and upon the written request of the
Required Lenders), shall, by notice to Multicare (on behalf of the Borrowers),
do one or more of the following: (i) take any and all actions permitted under
the Pledge Agreement or any other Loan Document or (ii) exercise such other
remedies as may be available to the Lender Parties under applicable Law.
(c) Equitable Remedies. It is agreed that, in addition to all
other rights hereunder or under Law, the Administrative Agent shall have the
right to institute proceedings in equity or other appropriate proceedings for
the specific performance of any covenant or agreement made in any of the Loan
Documents or for an injunction against the violation of any of the terms of any
of the Loan Documents or in aid of the exercise of any power granted in any of
the Loan Documents or by Law or otherwise.
9.3 APPLICATION OF PROCEEDS. After the occurrence of an Event of Default
and acceleration of the Loans, any amounts received on account of Loan
Obligations shall be applied by the Administrative Agent in the following order:
First, to payment of that portion of the Loan Obligations
constituting fees, indemnities, expenses and other amounts due to the
Administrative Agent in its capacity as such;
Second, to payment of that portion of the Loan Obligations
constituting fees, indemnities (other than those paid pursuant to the
preceding clause First) due to the Lender Parties, ratably among them in
proportion to the amounts described in this clause Second due to them;
Third, to payment of that portion of the Loan Obligations
constituting accrued and unpaid interest on Loans and accrued and unpaid
interest on Drawings, ratably among the Lender Parties in proportion to
the respective amounts described in this clause Third due to them;
Fourth, to payment of that portion of the Loan Obligations
constituting unpaid principal of the Loans or unreimbursed Drawings
ratably among the Lender Parties in proportion to the respective amounts
described in this clause Fourth due to them;
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Fifth, to be deposited in such cash collateral account, if any, as
may be required under Article 3 above;
Sixth, to payment of all other Loan Obligations, ratably among the
Lender Parties in proportion to the respective amounts described in this
clause Sixth due to them; and
Finally, the balance, if any, after all of the Loan Obligations have
been indefeasibly paid in full and all of the Letters of Credit shall have
terminated (or funds equal to the amount of any contingent liabilities in
respect thereof shall have been deposited in the Letter of Credit cash
collateral account), to Multicare (on behalf of the Borrowers) or as
otherwise required by Law.
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ARTICLE 10 - THE ADMINISTRATIVE AGENT
10.1 APPOINTMENT. Subject to the provisions of the second sentence of
Section 10.9 below, each Lender Party hereby irrevocably appoints Mellon to act
as Administrative Agent for such Lender Party under this Agreement and the other
Loan Documents. Each Lender Party hereby irrevocably authorizes the
Administrative Agent to take such action on behalf of such Lender Party under
the provisions of this Agreement and the other Loan Documents, and to exercise
such powers and to perform such duties, as are expressly delegated to or
required of the Administrative Agent by the terms hereof or thereof, together
with such powers as are reasonably incidental thereto. Mellon hereby agrees to
act as Administrative Agent on behalf of the Lender Parties on the terms and
conditions set forth in this Agreement and the other Loan Documents, subject to
its right to resign as provided in Section 10.9 hereof. Each Lender Party hereby
irrevocably authorizes the Administrative Agent to execute and deliver each of
the Loan Documents and to accept delivery of such of the other Loan Documents as
may not require execution by the Administrative Agent. Each Lender Party agrees
that the rights and remedies granted to the Administrative Agent under the Loan
Documents shall be exercised exclusively by the Administrative Agent (or a
Person designated by the Administrative Agent), and that no Lender shall have
any right individually to exercise any such right or remedy, except to the
extent, if any, expressly provided herein or therein.
10.2 GENERAL NATURE OF ADMINISTRATIVE AGENT'S DUTIES. Notwithstanding
anything to the contrary elsewhere in this Agreement or in any other Loan
Document:
(a) The Administrative Agent shall have no duties or
responsibilities except those expressly set forth in this Agreement and
the other Loan Documents, and no implied duties or responsibilities on the
part of the Administrative Agent shall be read into this Agreement or any
other Loan Document or shall otherwise exist.
(b) The duties and responsibilities of the Administrative Agent
under this Agreement and the other Loan Documents shall be mechanical and
administrative in nature, and the Administrative Agent shall not have a
fiduciary relationship with respect to any Lender Party.
(c) The Administrative Agent's relationship with and to the Lender
Parties is governed exclusively by the terms of this Agreement and the
other Loan Documents. The Administrative Agent does not assume, and shall
not at any time be deemed to have, any relationship of agency or trust
with or for, any Lender Party or any other Person or (except only as
expressly provided in this Agreement and the other Loan Documents) any
other duty or responsibility to such Lender Party or other Person.
(d) The Administrative Agent shall be under no obligation to take
any action hereunder or under any other Loan Document if the
Administrative Agent believes in good faith that taking such action may
conflict with any Law or any provision of this Agreement or any other Loan
Document, or may require the
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Administrative Agent to qualify to do business in any jurisdiction where
it is not then so qualified.
(e) The authority of the Administrative Agent to request information
from the Borrowers or take any other voluntary action hereunder shall
impose no duty of any kind on the Administrative Agent to make such
request or take any such action.
(f) The Administrative Agent shall have no duty to inquire whether
any Interest Rate Hedging Agreement conforms to the terms and limitations
of this Agreement and shall have no duty to inquire as to whether the
Borrowers maintain any Interest Rate Hedging Agreements.
10.3 EXERCISE OF POWERS. The Administrative Agent shall take any action of
the type specified in this Agreement or any other Loan Document as being within
the Administrative Agent's rights, powers or discretion in accordance with
directions from the Required Lenders (or as otherwise provided in the Loan
Documents). In the absence of such direction, the Administrative Agent shall
have the authority (but under no circumstances shall be obligated), in its sole
discretion, to take any such action, except to the extent that this Agreement or
such other Loan Document expressly requires the direction or consent of the
Required Lenders (or all of the Lenders, or some other Person or group of
Persons), in which case the Administrative Agent shall not take such action
absent such direction or consent. Any action or inaction pursuant to such
direction, discretion or consent shall be binding on each Lender Party (whether
or not it so consented). The Administrative Agent shall not have any liability
to any Person as a result of any action or inaction in conformity with this
Section 10.3.
10.4 GENERAL EXCULPATORY PROVISIONS. Notwithstanding anything to the
contrary elsewhere in this Agreement or any other Loan Document:
(a) The Administrative Agent shall not be liable for any action
taken or omitted to be taken by it under or in connection with this Agreement or
any other Loan Document, except only for direct (as opposed to consequential or
other) damages suffered by a Person and only to the extent that such Person
proves that such damages were caused by the Administrative Agent's own gross
negligence or willful misconduct.
(b) The Administrative Agent shall not be responsible for (i) the
execution, delivery, effectiveness, enforceability, genuineness, validity or
adequacy of any Loan Document, (ii) any recital, representation, warranty,
document, certificate, report or statement in, provided for in, or received
under or in connection with, any Loan Document, (iii) any failure of any Loan
Party, any Lender or the Issuer to perform any of their respective obligations
under any Loan Document, (iv) the existence, validity, enforceability,
perfection, recordation, priority, adequacy or value, now or hereafter, of any
Lien or other direct or indirect security afforded or purported to be afforded
by any Loan Document or otherwise from time to time, (v) caring for, protecting,
insuring, or paying any taxes, charges or assessments with respect to any
Collateral, or (vi) the enforceability of any subordination.
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(c) The Administrative Agent shall not be under any obligation to
ascertain, inquire or give any notice relating to (i) the performance or
observance of any of the terms or conditions of this Agreement or any other Loan
Document on the part of any Loan Party, (ii) the business, operations, condition
(financial or otherwise) or prospects of any Loan Party or any other Person
(even if the Administrative Agent knows or should know that some event or
condition exists or fails to exist), or (iii) except to the extent set forth in
Section 10.5(f) below, the existence of any Event of Default or Default.
(d) The Administrative Agent shall not be under any obligation,
either initially or on a continuing basis, to provide any Lender Party with any
notices, reports or information of any nature, whether in its possession
presently or hereafter, whether obtained under or in connection with this
Agreement or otherwise, except for such notices, reports and other information
expressly required by this Agreement or any other Loan Document to be furnished
by the Administrative Agent to such Lender Party.
10.5 ADMINISTRATION BY THE ADMINISTRATIVE AGENT.
(a) The Administrative Agent may rely upon any notice or other
communication of any nature (written or oral, including but not limited to
telephone conversations, whether or not such notice or other communication is
made in a manner permitted or required by this Agreement or any other Loan
Document) purportedly made by or on behalf of the proper party or parties, and
the Administrative Agent shall not have any duty to verify the identity or
authority of any Person giving such notice or other communication.
(b) The Administrative Agent may consult with legal counsel
(including in-house counsel for the Administrative Agent or in-house or other
counsel for any Loan Party), independent public accountants and any other
experts selected by it from time to time, and the Administrative Agent 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.
(c) The Administrative Agent may conclusively rely upon the truth of
the statements and the correctness of the opinions expressed in any certificates
or opinions furnished to the Administrative Agent in accordance with the
requirements of this Agreement or any other Loan Document. Whenever the
Administrative Agent shall deem it necessary or desirable that a matter be
proved or established with respect to any Loan Party or Lender Party, such
matter may be established by a certificate of such Loan Party or Lender Party,
as the case may be, and the Administrative Agent may conclusively rely upon such
certificate (unless other evidence with respect to such matter is specifically
prescribed in this Agreement or another Loan Document).
(d) The Administrative Agent may fail or refuse to take any action
unless it shall be directed by the Required Lenders (or all of the Lenders, or
some other Person or group of Persons, if this Agreement or another Loan
Document so expressly requires) to take such action and it shall be indemnified
to its satisfaction from time to time against any and all amounts, liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature which may be imposed on,
incurred
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by or asserted against the Administrative Agent by reason of taking or
continuing to take any such action.
(e) The Administrative Agent may perform any of its duties under
this Agreement or any other Loan Document by or through agents or
attorneys-in-fact. The Administrative Agent shall not be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.
(f) The Administrative Agent shall not be deemed to have any
knowledge or notice of the occurrence of any Event of Default or Default unless
the Administrative Agent has received notice from a Lender Party or a Borrower
referring to this Agreement, describing such Event of Default or Default, and
stating that such notice is a "notice of default." If the Administrative Agent
receives such a notice, the Administrative Agent shall give prompt notice
thereof to each Lender Party.
10.6 LENDER PARTIES NOT RELYING ON ADMINISTRATIVE AGENT OR OTHER LENDERS.
Each Lender Party acknowledges as follows: (a) neither the Administrative Agent
nor any other Lender Party has made any representations or warranties to it, and
no act taken hereafter by the Administrative Agent or any other Lender Party
shall be deemed to constitute any representation or warranty by the
Administrative Agent or such other Lender Party to it; (b) it has, independently
and without reliance upon the Administrative Agent or any other Lender Party,
and based upon such documents and information as it has deemed appropriate, made
its own credit and legal analysis and decision to enter into this Agreement and
the other Loan Documents; and (c) it will, independently and without reliance
upon the Administrative Agent or any other Lender Party, and based upon such
documents and information as it shall deem appropriate at the time, make its own
decisions to take or not take action under or in connection with this Agreement
and the other Loan Documents.
10.7 INDEMNIFICATION. Each Lender agrees to reimburse and indemnify each
Agent and its directors, officers, employees and agents (to the extent not
reimbursed by a Loan Party and without limitation of the obligations of the Loan
Parties to do so), in proportion to the Lenders' respective pro rata share of
(without duplication) the Commitment, the Loans and Letter of Credit
Participations, from and against any and all amounts, losses, liabilities,
claims, damages, expenses, obligations, penalties, actions, judgments, suits,
costs or disbursements of any kind or nature (including the fees and
disbursements of counsel for such Agent or such other Person in connection with
any investigative, administrative or judicial proceeding commenced or
threatened, whether or not such Agent or such other Person shall be designated a
party thereto) that may at any time be imposed on, incurred by or asserted
against such Agent or such other Person as a result of, or arising out of, or in
any way related to or by reason of, this Agreement, any other Loan Document, the
Tender Offer, any Acquisition or any other transaction from time to time
contemplated hereby or thereby, or any transaction actually or proposed to be
financed in whole or in part, directly or indirectly, with the proceeds of any
Loan or Letter of Credit, provided that no Lender shall be liable for any
portion of such amounts, losses, liabilities, claims, damages, expenses,
obligations, penalties, actions, judgments, suits, costs or disbursements that
such Lender Party proves were the result of the gross negligence or
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willful misconduct of such Agent or such other Person. Payments under this
Section 10.7 shall be due and payable on demand.
10.8 REGISTER. The Administrative Agent shall maintain at its address
referred to in Section 12.1 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lenders and the Commitment of, and principal amount of the
Loans and stated interest thereon owing to, each Lender from time to time (the
"Register"). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrowers, the Agents and the Lenders
may treat each Person whose name is recorded in the Register as a Lender
hereunder for all purposes of this Agreement. The Register shall be available
for inspection by Multicare on behalf of the Borrowers or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
10.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may resign
at any time by giving 30 days' prior written notice thereof to the other Lender
Parties and Multicare on behalf of the Borrowers. The Administrative Agent may
be removed by the Required Lenders at any time for cause by such Required
Lenders giving 30 days' prior written notice thereof to the Administrative
Agent, the other Lender Parties and Multicare on behalf of the Borrowers. Upon
any such resignation or removal, the Required Lenders shall have the right to
appoint a successor Administrative Agent with (so long as no Default or Event of
Default shall have occurred and then be continuing) the consent of Multicare on
behalf of the Borrowers whose consent shall not be unreasonably withheld or
delayed. If no successor Administrative Agent shall have been so appointed and
consented to, and shall have accepted such appointment, within 30 days after
such notice of resignation or removal, then the retiring Administrative Agent
may (but shall not be required to) appoint a successor Administrative Agent.
Each successor Administrative Agent shall be a Lender if any Lender shall at the
time be willing to become the successor Administrative Agent, and if no Lender
shall then be so willing, then such successor Administrative Agent shall be an
Eligible Institution. Upon the acceptance by a successor Administrative Agent of
its appointment as Administrative Agent hereunder, such successor Administrative
Agent shall thereupon succeed to and become vested with all the properties,
rights, powers, privileges and duties of the former Administrative Agent in its
capacity as such, without further act, deed or conveyance. Upon the effective
date of resignation or removal of a retiring Administrative Agent, such
Administrative Agent shall be discharged from its duties under this Agreement
and the other Loan Documents, but the provisions of this Agreement shall inure
to its benefit as to any actions taken or omitted by it while it was
Administrative Agent under this Agreement. If and so long as no successor
Administrative Agent shall have been appointed, then any notice or other
communication required or permitted to be given by the Administrative Agent
shall be sufficiently given if given by the Required Lenders, all notices or
other communications required or permitted to be given to the Administrative
Agent shall be given to each Lender, and all payments to be made to the
Administrative Agent shall be made directly to the Loan Party or Lender Party
for whose account such payment is made.
10.10 ADDITIONAL ADMINISTRATIVE AGENTS; COLLATERAL AGENT. If the
Administrative Agent shall from time to time deem it necessary or advisable, for
its
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own protection in the performance of its duties hereunder or in the interest of
the Lender Parties, the Administrative Agent and the Borrowers shall (and the
Borrowers shall cause the other Loan Parties to) execute and deliver a
supplemental agreement and all other instruments and agreements necessary or
advisable, in the opinion of the Administrative Agent, to constitute one or more
other Persons designated by the Administrative Agent, to act as
co-Administrative Agent or agent with respect to any part of the Collateral,
with such powers of the Administrative Agent as may be provided in such
supplemental agreement, and to vest in such other Person as such co-Agent or
separate agent, as the case may be, any properties, rights, powers, privileges
and duties of the Administrative Agent under this Agreement or any other Loan
Document.
10.11 CALCULATIONS. The Administrative Agent shall not be liable for any
calculation, apportionment or distribution of payments made by it in good faith
and without gross negligence or willful misconduct. If such calculation,
apportionment or distribution is subsequently determined to have been made in
error, the sole recourse of any Lender Party to whom payment was due but not
made shall be to recover from the other Lender Parties any payment in excess of
the amount to which they are determined to be entitled or, if the amount due was
not paid by the appropriate Loan Party, to recover such amount from the
appropriate Loan Party.
10.12 OTHER AGENTS.
(a) In General. The title "Syndication Agent" given to Citicorp USA, Inc.
and NationsBank, N.A. in this Agreement and the title "Documentation Agent"
given to First Union National Bank in this Agreement are solely for
identification purposes and imply no rights in favor of such Person and no
responsibility by such Person except such rights or obligations of "Agents"
(including the right to make certain determinations) as are expressly stated
herein. No such Agent shall be liable for any act or failure to act on its part
except for that which the claimant proves constitutes the gross negligence or
willful misconduct of such Agent.
(b) Successor Agents. Any Syndication Agent and the Documentation Agent
may resign at any time and such Agents may be removed at any time for cause by
the other Agents and Multicare in which event, Multicare (on behalf of the
Borrowers) if no Default or Event of Default shall then exist, and the
Administrative Agent may (in their sole discretion) appoint a successor Agent.
10.13 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. With respect to its
Commitment hereunder and the Loan Obligations owing to it, the Administrative
Agent shall have the same rights and powers under this Agreement and each other
Loan Document as any other Lender and may exercise the same as though it were
not the Administrative Agent, and the terms "Lender", "Holder of Notes" and like
terms shall include the Administrative Agent in its individual capacity as such.
The Administrative Agent and its Affiliates may, without liability to account,
make loans to, accept deposits from, acquire debt or equity interests in, act as
trustee under indentures of, enter into Interest Rate Hedging Agreements with,
serve as "Administrative Agent" for other financing
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vehicles, issue letters of credit on behalf of, and engage in any other business
with, (a) any Loan Party or any stockholder, Subsidiary or Affiliate of any Loan
Party or (b) any other Person, whether such other Person may be engaged in any
conflict or dispute with any Loan Party or any Lender Party or otherwise, as
though the Administrative Agent were not the Administrative Agent hereunder.
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ARTICLE 10A
SPECIAL INTERCREDITOR PROVISIONS
10A.1 SPECIAL PROVISIONS APPLICABLE TO LENDER PARTIES AS PARTIES TO
THE GENESIS CREDIT AGREEMENT. There are certain understandings about the Genesis
Credit Agreement which the Lenders have relied upon in entering into this
Agreement and wish to confirm in an intercreditor agreement with the parties to
the Genesis Credit Agreement. Because each of the Lenders hereunder is also a
"Lender" under the Genesis Credit Agreement, this provision (and a corresponding
provision in the Genesis Credit Agreement) shall take the place of a separate
agreement and shall serve as a intercreditor agreement among the lenders party
to this Agreement and the lenders party to the Genesis Credit Agreement.
Accordingly, each of the Lenders hereunder, in its capacity as a "Lender" under
the Genesis Credit Agreement, agree, so long as it remains a party to the
Genesis Credit Agreement, that without the written consent of the Required
Lenders, the parties to the Genesis Credit Agreement will not amend, modify,
supplement or restate the assignment provisions of the Genesis Credit Agreement
(currently set forth in Section 12.9 of the Genesis Credit Agreement ) which
require that assignments or participations of any lender's rights and
obligations thereunder be made concurrent with a like assignment or
participation of such lender's rights and obligations hereunder.
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ARTICLE 10B
SPECIAL INTER-BORROWER PROVISIONS
10B.1 CERTAIN BORROWER ACKNOWLEDGEMENTS.
(a) Each Borrower acknowledges that it will enjoy significant
benefits from the business conducted by the other Borrowers because of, inter
alia, their combined ability to bargain with other Persons including without
limitation their ability to receive the credit facilities on favorable terms
granted by this Agreement and other Loan Documents which would not have been
available to an individual Borrower acting alone. Each Borrower has determined
that it is in its best interest to procure credit facilities which each Borrower
may utilize directly and which receive the credit support of the other Borrowers
as contemplated by this Agreement and the other Loan Documents.
(b) The Lenders have advised the Borrowers that they are unwilling
to enter into this Agreement and the other Loan Documents and make available the
credit facilities extended hereby to any Borrower unless each Borrower agrees,
among other things, to be jointly and severally liable for the due and proper
payment of the obligations of each other Borrower under this Agreement and other
Loan Documents. Each Borrower has determined that it is in its best interest and
in pursuit of its purposes that it so induce the Lenders to extend credit
pursuant to this Agreement and the other documents executed in connection
herewith (i) because of the desirability to each Borrower of the credit
facilities, the interest rates and the modes of borrowing available hereunder,
(ii) because each Borrower may engage in transactions jointly with other
Borrowers and (iii) because each Borrower may require, from time to time, access
to funds under this Agreement for the purposes herein set forth.
(c) Each Borrower has determined that it has and, after giving
effect to the transactions contemplated by this Agreement and the other Loan
Documents (including, without limitation, the inter-Borrower arrangement set
forth in this Article 10(B) will have, assets having a fair saleable value in
excess of the amount required to pay its probable liability on its existing
debts as they fall due for payment and that the sum of its debts is not and will
not then be greater than all of its property at a fair valuation, that such
Borrower has, and will have, access to adequate capital for the conduct of its
business and the ability to pay its debts from time to time incurred in
connection therewith as such debts mature and that the value of the benefits to
be derived by such Borrower from the access to funds under this Agreement
(including, without limitation, the inter-Borrower arrangement set forth in this
Section 10B) is reasonably equivalent to the obligations undertaken pursuant
hereto.
10B.2 CERTAIN INTER-BORROWER AGREEMENTS.
(a) Subject to paragraph (b) below, each Borrower as indemnitor
shall indemnify the other Borrowers as indemnitees for all Loan Obligations
incurred by the indemnitee Borrowers for Loans advanced to, or Letters of Credit
issued for the account of, the indemnitor Borrower.
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(b) The rights and obligations of the Borrowers pursuant to
paragraph (a) above shall be subordinated in all respects to the rights of the
Administrative Agent and the other Lender Parties with respect to the Loan
Obligations and, accordingly, each Borrower agrees that it shall not make any
payment or receive any payment pursuant to the preceding paragraph (a) at any
time a Default has occurred and is continuing or would be caused thereby. Each
Borrower agrees that in the event it receives any payment described by or in
violation of this paragraph (b), it shall accept such payment as agent of the
Administrative Agent, for the benefit of the Lender Parties, and hold the same
in trust on behalf of and for the benefit of the Administrative Agent, for the
benefit of the Lender Parties.
10B.3 RECORDS. Multicare (on behalf of each Borrower) shall maintain
records specifying (a) all Loan Obligations incurred by each Borrower, (b) the
date of such incurrence, (c) the date and amount of any payments made in respect
of such Loan Obligations and (d) all inter-Borrower obligations pursuant to
paragraph 10B.2 above. Multicare shall make copies of such records available to
the Administrative Agent, upon request.
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ARTICLE 11
DEFINITIONS; CONSTRUCTION
11.1 CERTAIN DEFINITIONS. As used in this Agreement, the following
terms have the following meanings, (terms defined in the singular to have a
correlative meaning when used in the plural) unless the context hereof otherwise
clearly requires:
"Accumulated Funding Deficiency" has the meaning given to such term
in ss.4001(a)(18) of ERISA.
"Acquisition" means any acquisition by one or more of the Borrowers,
directly or indirectly, whether in one transaction or in a series of related
transactions (and whether by merger, consolidation, acquisition of assets or
otherwise) of all or any substantial portion of the ownership interests in or
assets of any separate business enterprise.
"Acquisition Corp." means Genesis Eldercare Acquisition Corp., a
Delaware corporation.
"Acquisition Cost" means, with respect to any Acquisition, the value
in Dollars of the total consideration paid or payable (whether immediate or
deferred and whether in cash, equity or other assets) by any of the Borrowers
(such consideration including the amount of any Assumed Indebtedness) for or in
respect of the ownership interests or assets being acquired in such Acquisition.
"Adjusted Senior Debt/Cash Flow Ratio" means as of any date of
determination:
(a) Adjusted Senior Debt as of such date of determination
divided by
(b) Cash Flow of Multicare and its Restricted Subsidiaries, on
a consolidated basis, for the four fiscal quarters ending on,
or most recently prior to, such date of determination.
"Adjusted Senior Debt" means, as of any date of determination, the
result of:
(a) Adjusted Total Indebtedness, as of such date of
determination
less
(b) the sum of (i) Indebtedness which is evidenced by the 1997
Subordinated Notes, and (ii) any other Indebtedness which is
both permitted under the terms of this Agreement and expressly
subordinated in right of payment to all Loan Obligations under
terms satisfactory to the Administrative Agent.
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"Adjusted Total Debt/Cash Flow Ratio" means, as of any date of
determination, the ratio of:
(a) Adjusted Total Indebtedness as of such date of
determination
divided by
(b) Cash Flow of Multicare and its Restricted Subsidiaries, on
a consolidated basis, for the four fiscal quarters ended on,
or most recently prior to, such date of determination.
"Adjusted Total Indebtedness" means, as of any date of
determination, the sum of:
(a) Total Funded Indebtedness as of such date of determination
plus
(b) the product of (i) the amount of Rental Expense of
Multicare and its Restricted Subsidiaries, on a consolidated
basis, for the four fiscal quarters ended on, or most recently
prior to, such date of determination multiplied by (ii) eight
(8).
"Administrative Agent" has the meaning ascribed to such term in the
preamble of this Agreement.
"Affiliate" of a Person means (a) any other Person which directly or
indirectly controls, or is controlled by, or is under common control with, such
Person, (b) any director or officer (or, in the case of a Person which is not a
corporation, any individual having analogous powers) of such Person or of a
Person who is an Affiliate of such Person, and (c) any individual related to
such Person or Affiliate by consanguinity or adoption within the third degree.
For purposes of the preceding sentence, "control" of a Person means (a) the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by contract or otherwise and (b) in any case
shall include direct or indirect ownership (beneficially or of record) of, or
direct or indirect power to vote, 5% or more of the outstanding shares of any
class of capital stock of such Person (or in the case of a Person that is not a
corporation, 5% or more of any class of equity interest). Excluded Subsidiaries
may be "Affiliates" of Multicare.
"Agents" means collectively the Administrative Agent, Citicorp USA,
Inc., and NationsBank, N.A., each as a Syndication Agent, and First Union
National Bank, as Documentation Agent.
"Agreement" means this Credit Agreement as the same may be amended,
modified, restated or supplemented from time to time in accordance with its
terms.
"Agreement Date" means the date first-above written.
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"Amount of Unfunded Benefit Liabilities" has the meaning given to
such term in ss.4001(a)(18) of ERISA.
"Applicable Margin" means a marginal rate of interest which is added
to the LIBO Rate or Prime Rate, as the case may be, to determine the effective
rate of interest on Loans and other payments as specified in the Loan Documents.
Until the Officer's Compliance Certificate for the fiscal year ended December
31, 1997 is delivered to the Administrative Agent and Lenders pursuant to
Section 6.1 above, the Applicable Margin (a) for LIBO Rate Loans shall be the
following: 2.5% for any RC Loans or Tranche A Term Loans; 2.75% for any Tranche
B Term Loans; and 3.0% for any Tranche C Term Loan, and (b) for Prime Rate Loans
shall be .75% for RC Loans and Tranche A Loans, shall be 1.0% for Tranche B
Loans and shall be 1.25% for Tranche C Loans. Thereafter, the Applicable Margin
shall be determined in the following manner:
(a) For any RC Loans or Tranche A Term Loans, the Applicable Margin
shall be the percentage amount set forth below under the caption
"Applicable Margin for RC Loans and Tranche A Term Loans" opposite the
relevant Adjusted Total Debt/Cash Flow Ratio:
Adjusted Total Applicable Margin for RC Loans
Debt/Cash Flow Ratio and Tranche A Term Loans
-------------------- ------------------------------
Prime Rate Loans LIBO Rate Loans
---------------- ---------------
below 3.0 0 .75%
>= 3.0 < 3.5 0 1.00%
>= 3.5 < 4.0 0 1.25%
>= 4.0 < 4.5 0 1.50%
>= 4.5 < 5.0 0 1.75%
>= 5.0 < 5.5 .25% 2.00%
>= 5.5 < 6.0 .50% 2.25%
>= 6.0 .75% 2.50%
(b) For any Tranche B Term Loans, the Applicable Margin for LIBO
Rate Loans shall be 2.75%, provided, however, that any time that the
Adjusted Total Debt/Cash Flow Ratio is less than 4.5 to 1.0, the
Applicable Margin for Tranche B Term Loans shall be 2.5%. The Applicable
Margin for Tranche B Term Loans which are Prime Rate Loans shall be 1.0%
provided, however, that at any time that the Adjusted Total Debt/Cash Flow
Ratio is less than 4.5 to 1.0 the Applicable Margin for Tranche B Loans
which are Prime Rate Loans shall be .75%.
(c) For any Tranche C Term Loans, the Applicable Margin for LIBO
Rate Loans shall be 3.0%, provided, however, that any time that the
Adjusted Total Debt/Cash Flow Ratio is less than 4.5 to 1.0, the
Applicable Margin for Tranche C Term Loans shall be 2.75%. The Applicable
Margin for Tranche C Term Loans which are Prime Rate Loans shall be 1.25%
provided, however, that at any time that the Adjusted Total Debt/Cash Flow
Ratio is less than 4.5 to 1.0 the Applicable Margin for Tranche C Loans
which are Prime Rate Loans shall be 1.00%.
(d) The Applicable Margin for Swing Loans at all times shall be
zero.
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The Applicable Margin shall be adjusted five Business Days after receipt of the
annual or quarterly Officer's Compliance Certificate, delivered pursuant to
Section 6.1. At any time that such annual or quarterly Officer's Compliance
Certificate is required to be delivered pursuant to said Section 6.1 and is not
so delivered, then the Applicable Margin shall be the highest rate specified for
the subject Tranche or Loan until the Officer's Compliance Certificate is so
delivered.
"Assignment and Acceptance" shall have the meaning ascribed to such
term in Section 12.9.
"Assumed Indebtedness" means Indebtedness incurred by a Person which
is not a Borrower and which (a) is existing at the time such Person (or assets
of such Person) is acquired by a Borrower and (b) is assumed by a Borrower in
connection with such Acquisition, other than Indebtedness incurred by the
original obligor in connection with, or in contemplation of, such Acquisition.
"Available RC Commitment" means, as of any date, the difference
between (a) and (b) where (a) is the amount of the RC Commitment on such date
and (b) is the sum of (i) the aggregate outstanding principal amount of all RC
Loans on such date, (ii) the face amount of all outstanding Letters of Credit on
such date, (iii) the aggregate unpaid amount of all Drawings under Letters of
Credit as of such date, (iv) the aggregate outstanding principal amount of all
Swing Loans on such date, (v) the maximum amount necessary to redeem by March
16, 1998, all shares of stock issuable on conversion of Multicare's Convertible
Subordinated 7% Debentures outstanding on the date of determination of
"Available RC Commitment," and (vi) the maximum amount (including principal,
interest, premiums and fees, if any) necessary to repay by January 2, 1998, all
of Multicare's Senior Subordinated 12-1/2% Notes outstanding on the date of
determination of "Available RC Commitment." For purposes of clauses (v) and (vi)
the phrase "outstanding on the date of determination of "Available RC
Commitment" shall initially be determined with reference to the Officers
Certificate delivered by Multicare pursuant to Section 4.1(l) hereof and
thereafter shall be determined with reference to updated Officer's Certificates
(in the form and with the same level of detail as the Officer's Certificate
delivered pursuant to Section 4.1(l) above) which Multicare may deliver to the
Administrative Agent from time to time, provided that Multicare shall deliver
not more than four (4) such updated Officer's Certificates hereunder.
"Bank Tax" means (i) any Tax based on or measured by net income of a
Lender Party, any franchise Tax and any doing business Tax imposed upon any
Lender Party by any jurisdiction (or any political subdivision thereof) in which
such Lender Party or any lending office of a Lender Party is located and (ii)
for the purposes of Section 1.13, any other Tax imposed by a jurisdiction other
than the United States or a political subdivision thereof that would not have
been imposed but for a present or former connection between such Lender Party or
lending office (as the case may be) and such jurisdiction.
"Borrowers" has the meaning ascribed to such term in the preamble
hereto. It is the intent of the parties (and a covenant of the Borrowers herein)
that each Person which is now or hereafter becomes a direct or indirect
Subsidiary of Multicare, other than Excluded Subsidiaries, shall at all times
after becoming a Subsidiary of Multicare be a "Borrower" pursuant to the terms
of this Agreement.
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"Business Day" means any day other than a Saturday, Sunday, public
holiday under the laws of the Commonwealth of Pennsylvania, the State of New
York or other day on which banking institutions are authorized or obligated to
close in the city in which the Administrative Agent's Domestic Lending Office is
located or, as applicable, in the city in which the Issuer's Domestic Lending
Office is located, provided, however, that whether or not expressly stated in
this Agreement or other Loan Documents, when "Business Day" is used with respect
to any LIBO Rate Loan, such Business Day must also be a Eurodollar Business Day.
"Capital Expenditures", with respect to any Person, means, for any
period, all expenditures (whether paid in cash or accrued as liabilities) of
such Person during such period which are, or should be, classified as capital
expenditures in accordance with GAAP.
"Capitalized Lease" means at any time any lease which is, or should
be, capitalized on the balance sheet of the lessee at such time in accordance
with GAAP.
"Capitalized Lease Obligation" of any Person at any time means the
aggregate amount which is, or should be, reported as a liability on the balance
sheet of such Person at such time as lessee under a Capitalized Lease in
accordance with GAAP.
"Cash Equivalent Investments" means any of the following: (i) full
faith and credit obligations of the United States of America, or fully
guaranteed as to interest and principal by the full faith and credit of the
United States of America, maturing in not more than one year from the date such
investment is made; (ii) time deposits and certificates of deposit having a
final maturity of not more than one year after the date of issuance thereof of
any commercial bank incorporated under the laws of the United States of America
or any state thereof or the District of Columbia, which bank is a member of the
Federal Reserve System and has a combined capital and surplus of not less than
$1,000,000,000.00 and with a senior unsecured debt credit rating of at least "A"
by ▇▇▇▇▇'▇ Investors Service, Inc. or "A" by Standard & Poor's Ratings Services;
(iii) commercial paper of companies, banks, trust companies or national banking
associations (in each case excluding Multicare and its Affiliates) incorporated
or doing business under the laws of the United States or one of the States
thereof, in each case having a remaining term until maturity of not more than
180 days from the date such investment is made and rated at least P-1 by ▇▇▇▇▇'▇
Investors Service, Inc. or at least A-1 by Standard & Poor's Ratings Services;
and (iv) repurchase agreements with any financial institution having combined
capital and surplus of not less than $1,000,000,000.00 with a term of not more
than seven days for underlying securities of the type referred to in clause (i)
above.
"Cash Flow", with respect to any Person, for any period, means (a)
Net Income of such Person plus (b) each of the following to the extent deducted
in determining Net Income: (i) Interest Expense, (ii) Rental Expense, (iii)
depreciation expense, (iv) amortization expense and, (v) income taxes, all as
adjusted for changes in accrued management fees under the Multicare Management
Agreement, in each case for such period.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act, as amended, and any successor statute of similar
import, and regulations thereunder, in each case as in effect from time to time.
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"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System List, as the same may be amended
from time to time.
"Change of Control" means the occurrence of any of the following
events:
(a) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended) other than a Permitted Holder (as hereinafter defined), in
a single transaction or through a series of related transactions, is
or becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Securities Exchange Act of 1934, as amended except that a Person
shall be deemed a "beneficial owner" of all securities that such
Person has a right to acquire, whether such right is exercisable
immediately or only after the passage of time, upon the happening of
an event or otherwise), directly or indirectly, of more than, on a
fully diluted basis, 35% of the total Voting Stock of the Surety
(and all rights and options to purchase such Voting Stock) if such
"beneficial ownership" is greater than the amount of voting power of
the Voting Stock of the Surety (and all rights and options to
purchase such Voting Stock) held by Genesis and its Affiliates on
such date;
(b) TPG, Cypress, Nazem and Genesis, collectively, shall cease
to own beneficially and of record at least 51% of the shares of each
class of capital stock of Surety (and all rights and options to
purchase such shares of capital stock) subject to no Liens;
(c) if Surety at any time fails to own beneficially and of
record 100% of the capital stock of Multicare (and all rights and
option to purchase such shares of capital stock);
(d) if Multicare at any time fails to own beneficially and of
record 100% of the capital stock of all the Borrowers (subject to
any permitted disposition pursuant to Section 8.5 hereof);
(e) if Surety, Multicare or any other Loan Party consolidates
or merges with or into another corporation or conveys, transfers or
leases all or substantially all of its assets to any Person, or any
corporation consolidates or merges with or into Surety, Multicare or
any other Loan Party, in any such event pursuant to a transaction in
which the outstanding Voting Stock of Surety, Multicare or any other
Loan Party is changed into or exchanged for cash, securities or
other property, other than any such transaction where (i) the
outstanding Voting Stock of Surety, Multicare or any other Loan
Party is changed into or exchanged for (x) Voting Stock of the
surviving corporation which is not Redeemable Capital Stock (as
hereinafter defined) or (y) cash, securities or other property in an
amount which such party would not be prohibited, under the 1995
Subordinated Note Indenture, or the 1996 Subordinated Note
Indenture, to the extent either is applicable as set forth in
Section 5.1(w), or the 1997 Subordinated Note Indenture if then in
effect from paying as a "restricted payment" (as defined in such
indentures), and (ii) the
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holders of the Voting Stock of Surety, Multicare or any other Loan
Party, as the case may be, immediately prior to such transaction
own, directly or indirectly, not less than 50% of the Voting Stock
of the surviving corporation immediately after such transaction;
(f) if during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of
Directors of Surety, Multicare or any other Loan Party (together
with any new directors whose election by any such Board of Directors
or whose nomination for election by the stockholders of such company
was approved by a vote of at least 66-2/3% of the directors then
still in office who were either directors at the beginning of such
period or whose election or nomination for election was previously
so approved) cease for any reason to constitute a majority of such
Board of Directors then in office except in the case of a change in
the composition of the Board of Directors of Multicare, approved by
Genesis in connection with its acquisition of the common stock of
Surety held by Cypress, Nazem and TPG); or
(g) Surety, Multicare or any other Loan Party is liquidated or
dissolved or adopts a plan of liquidation.
For purposes of this definition of "Change of Control," (A) "Voting Stock" shall
mean stock of the class or classes pursuant to which the holders thereof have
the general voting power under ordinary circumstances to elect at least a
majority of the board of directors, managers or trustees of a corporation
(irrespective of whether or not at the time stock of any other class or classes
shall have or might have voting power by reason of the happening of any
contingency); (B) "Redeemable Capital Stock" of a Person shall mean any capital
stock or equity interests that, either by its terms, by the terms of any
security into which it is convertible or exchangeable or otherwise, is, or upon
the happening of an event or passage of time would be, required to be redeemed
prior to any stated maturity of the principal of the 1995 Subordinated Notes, or
the 1996 Subordinated Notes, the extent either is applicable as set forth in
Section 5.1(w), or the 1997 Subordinated Notes or is redeemable at the option of
the holder thereof at any time prior to any such stated maturity, or is
convertible into or exchangeable for debt securities at any time prior to any
such stated maturity at the option of the holder thereof; (C) "Board of
Directors" of a company shall mean the board of directors of such company or the
executive committee of such company; and (D) "Permitted Holder" shall mean (i)
Genesis, Cypress and TPG, in the case of Surety, (ii) Surety in the case of
Multicare, and (iii) Multicare in the case of its Subsidiaries.
"Closing Date" means the date that the initial Loans are made
hereunder.
"COBRA Violation" means any violation of the "continuation coverage
requirements" of "group health plans" of former ss.162(k) of the Code (as in
effect for tax years beginning on or before December 31, 1988) and of ss.4980B
of the Code (as in effect for tax years beginning on or after January 1, 1989)
and Part 6 of Subtitle B of Title I of ERISA.
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"Code" shall mean the Internal Revenue Code of 1986, as amended, and
any successor statute of similar import, and regulations thereunder, in each
case as in effect from time to time, and the Treasury regulations thereunder.
"Collateral" means (a) the cash collateral account, if any, in
respect of Letters of Credit from time to time and (b) the collateral subject
to, or purported to be subject to, the Liens of the Pledge Agreement, from time
to time.
"Commitment" means, with respect to any Lender, the obligation of
such Lender to make Loans pursuant to the terms of this Agreement and, with
respect to the Issuer, to issue Letters of Credit. "Commitment" means, with
respect to all Lender Parties, the sum of each Lender Party's Commitment.
"Contingent Reimbursement Obligation" means the contingent
obligation of the Borrowers to reimburse the Issuer for any Drawings that may be
made under an outstanding Letter of Credit, whenever issued. Without limiting
the generality of the foregoing, the amount of all Contingent Reimbursement
Obligations at any time shall be the aggregate amount available to be drawn
under outstanding Letters of Credit at such time.
"Controlled Group" means a group of employers, of which any Borrower
is a member and which group constitutes:
(a) A controlled group of corporations (as defined inss.414(b)
of the Code);
(b) Trades or businesses (whether or not incorporated) which
are under common control (as defined in ss.414(c) of the Code);
(c) Trades or businesses (whether or not incorporated) which
constitute an affiliated service group (as defined in ss.414(m) of the Code); or
(d) Any other entity required to be aggregated with any
Borrower pursuant to ss.414(o) of the Code.
"Cypress" means The Cypress Group L.L.C., a Delaware limited
liability company and (a) any Subsidiary thereof and (b) any other Affiliate
thereof reasonably acceptable to the Administrative Agent. Without limiting the
generality of the foregoing, "Cypress" shall include Cypress Associates L.P.,
Cypress Offshore Partners L.P., Cypress Merchant Banking Partners L.P., and
Cypress Advisors Inc.
"Default" means any event or condition which with notice, passage of
time or both, would constitute an Event of Default.
"Default Rate" means, with respect to any amounts payable hereunder
or under the other Loan Documents, a rate equal to the sum of (a) two percent
(2%) per annum plus (b) the interest rate otherwise in effect with respect to
such amounts or, if no such rate is otherwise in effect with respect to such
amounts, a rate equal to the sum of (i) the Prime Rate plus (ii) the highest
Applicable Margin thereon plus (iii) two percent (2%).
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"Defined Benefit Pension Plan" means a defined benefit plan (other
than a Multiemployer Plan) as defined in ss.3(35) of ERISA which is maintained
by any Borrower or any member of its Controlled Group.
"Defined Contribution Plan" means an individual account plan (other
than a Multiemployer Plan) as defined in ss.3(34) of ERISA which is maintained
by any Borrower or any member of its Controlled Group.
"Dollar," "Dollars" and the symbol "$" means lawful money of the
United States of America.
"Domestic Lending Office" means, with respect to any Lender or the
Issuer (i) the branch or office of such Lender or the Issuer, as the case may be
designated, from time to time, by such Person in a notice to the Administrative
Agent and Multicare.
"Drawing" means (a) any amount disbursed by the Issuer pursuant to
the terms of a Letter of Credit or (b) as the context may require, the
obligation of the Borrowers to reimburse the Issuer for such disbursement.
"EBITDA" means Net Income before Interest Expense, provision for
income taxes, depreciation and amortization, as adjusted on a pro forma basis
for the transactions contemplated by the Multicare Management Agreement.
"Eligible Institution" means (i) a Lender; (ii) an Affiliate of a
Lender; (iii) a commercial bank organized under the laws of the United States,
or any State thereof, and having a combined capital and surplus of at least
$1,000,000,000.00; (iv) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof, and having a combined
capital and surplus of at least $1,000,000,000.00; (v) a commercial bank
organized under the laws of any other country that is a member of the
Organization for Economic Cooperation and Development or has concluded special
lending arrangements with the International Monetary Fund associated with its
General Arrangements to Borrow or under the laws of a political subdivision of
any such country, and having a combined capital and surplus of at least
$1,000,000,000.00, so long as such bank is acting through a branch or agency
located in the United States; and (vi) a finance company, insurance company or
other financial institution or fund (whether a corporation, partnership, trust
or other entity) that is engaged in making, purchasing or otherwise investing in
commercial loans in the ordinary course of its business and having a combined
capital and surplus or total assets of at least $500,000,000.00 and (vii) with
respect to any Lender that is a fund, any other fund with assets in excess of
$100,000,000.00 that invests in bank loans and is managed by the same investment
advisor as such Lender; provided, however, that neither any Loan Party nor any
Affiliate of a Loan Party shall qualify as an Eligible Institution under this
definition.
"Environmental Affiliate" means, with respect to any Person, any
other Person whose liability (contingent or otherwise) for any Environmental
Claim such Person has retained, assumed or otherwise is liable for (by Law,
agreement or otherwise).
"Environmental Approvals" means any approval, order, consent,
authorization, certificate, license, permit or validation of, or exemption or
other action by, or
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filing, recording or registration with, any Governmental Authority pursuant to
or required under any Environmental Law.
"Environmental Claim" means, with respect to any Person, any action,
suit, proceeding, investigation, notice, claim, complaint, demand, request for
information or other communication (written or oral) by any other Person
(including but not limited to any Governmental Authority, citizens' group or
present or former employee of such Person) alleging, asserting or claiming any
actual or potential (a) violation of any Environmental Law, (b) liability under
any Environmental Law or (c) liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damages, property damages,
personal injuries, fines or penalties arising out of, based on or resulting from
the presence, or release into the environment, of any Environmental Concern
Materials at any location, whether or not owned by such Person.
"Environmental Cleanup Site" means any location which is listed or
proposed for listing on the National Priorities List (as established under
CERCLA), on CERCLIS or on any similar state list of sites requiring
investigation or cleanup, or which is the subject of any pending or threatened
action, suit, proceeding or investigation related to or arising from any alleged
violation of any Environmental Law.
"Environmental Concern Materials" means (a) any flammable substance,
explosive, radioactive material, hazardous material, hazardous waste, toxic
substance, solid waste, pollutant, contaminant or any related material, raw
material, substance, product or by-product of any substance specified in or
regulated or otherwise affected by any Environmental Law (including but not
limited to any "hazardous substance" as defined in CERCLA or any similar state
Law), (b) any toxic chemical or other substance from or related to industrial,
commercial or institutional activities, and (c) asbestos, gasoline, diesel fuel,
motor oil, waste and used oil, heating oil and other petroleum products or
compounds, polychlorinated biphenyls, radon and urea formaldehyde.
"Environmental Law" means any Law, whether now existing or
subsequently enacted or amended, relating to (a) pollution or protection of the
environment, including natural resources, (b) exposure of Persons, including but
not limited to employees, to Environmental Concern Materials, (c) protection of
the public health or welfare from the effects of products, by-products, wastes,
emissions, discharges or releases of Environmental Concern Materials or (d)
regulation of the manufacture, use or introduction into commerce of
Environmental Concern Materials including their manufacture, formulation,
packaging, labeling, distribution, transportation, handling, storage or
disposal. "Environmental Law" shall also include any Environmental Approval and
the terms and conditions thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations thereunder.
"Eurodollar Business Day" means any Business Day on which dealings
in Dollar deposits are carried on in the London interbank market and on which
commercial banks are open for domestic and international business (include
dealings in Dollar deposits) in London, England.
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"Eurodollar Lending Office" means, with respect to any Lender or the
Issuer, the branch or office of such Lender or the Issuer, as the case may be,
designated by such Person in a notice to the Administrative Agent and Multicare.
"Event of Default" means any of the Events of Default described in
Section 9.1 hereof.
"Excess Cash Flow" means, for any fiscal year of the Borrowers, the
amount, if any, by which Net Cash Provided by Operations for such fiscal year
exceeds the sum of (a) the aggregate principal amount of Total Funded
Indebtedness incurred consistently with the terms of this Agreement and
scheduled to have been repaid or prepaid during such fiscal year, plus (b) the
amount of any Investments made pursuant to Section 8.3(i).
"Excluded Subsidiaries" means, subject to Section 6.10(b), the
entities listed on Schedule 11.1 attached hereto and, after the Closing Date,
each Subsidiary of any Excluded Subsidiary.
"Federal Funds Rate" for any day means the rate per annum determined
by the Administrative Agent (which determination shall be conclusive) to be the
rate per annum announced by the Federal Reserve Bank of New York on such day as
being the weighted average of the rates on overnight Federal funds transactions
arranged by federal funds brokers on the previous trading day, or, if such
Federal Reserve Bank does not announce such rate on any day, the rate for the
last day on which such rate was announced.
"Fixed Charge Coverage Ratio" means, as of any date of
determination, the result of:
(a) Cash Flow of Multicare and its Restricted Subsidiaries, on
a consolidated basis, for the four fiscal quarters ending on,
or most recently prior to, such date of determination
divided by
(b) the sum of (i) Interest Expense, income taxes and Rental
Expense of Multicare and its Restricted Subsidiaries, on a
consolidated basis, for the four fiscal quarters ending on, or
most recently prior to such date of determination and (ii)
principal payments scheduled or required to be made on Total
Funded Indebtedness for the four fiscal quarters ending on, or
most recently prior to, such date of determination.
"GAAP" has the meaning set forth in Section 11.3 hereof.
"Genesis" has the meaning ascribed to such term in Section 4.1
hereof.
"Genesis Credit Agreement" has the meaning ascribed to such term in
Section 4.1 hereof.
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"Genesis Group" means Genesis and its Subsidiaries other than the
Multicare Group.
"Governmental Authority" means any government or political
subdivision or any agency, authority, bureau, central bank, commission,
department or instrumentality of either, or any court, tribunal, grand jury or
arbitrator, in each case whether foreign or domestic.
"Guaranty" means, with respect to any Person (a "Guarantor"), any
contractual or other obligation, contingent or otherwise, of such Person to pay
any Indebtedness or other obligation of any other Person or to otherwise protect
the holder of any such Indebtedness or other obligation against loss (whether
such obligation arises by agreement to pay, to keep well, to purchase assets,
goods, securities or services or otherwise) provided, however, that the term
"Guaranty" shall not include an endorsement for collection or deposit in the
ordinary course of business. The term, "Guaranty," when used as a verb has the
correlative meaning.
"Health Care Business" means any healthcare related business
including any facility, unit, operation, or business supplying health care
services, supplies or products, including long-term care, rehabilitation
therapy, specialized health care, health care management and pharmacies.
"Indebtedness" of any Person means (without duplication):
(a) all obligations on account of money borrowed by, or credit
extended to or on behalf of, or for or on account of deposits with or advances
to, such Person;
(b) all obligations of such Person evidenced by bonds,
debentures, notes or similar instruments;
(c) all obligations of such Person for the deferred purchase
price of property or services;
(d) all obligations secured by a Lien on property owned by
such Person (whether or not assumed) provided, however, for purposes of
determining the amount of such Indebtedness under this clause (d), the amount of
any such non-recourse Indebtedness shall be limited to the lesser of (i) the
fair market value of the asset subject to such Lien and (ii) the amount of such
Indebtedness;
(e) all obligations of such Person under Capitalized Leases
(without regard to any limitation of the rights and remedies of the holder of
such Lien or the lessor under such Capitalized Lease to repossession or sale of
such property);
(f) the face amount of all letters of credit issued for the
account of such Person and, without duplication, the unreimbursed amount of all
drafts drawn thereunder, and all other obligations of such Person associated
with such letters of credit or draws thereon;
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(g) all obligations of such Person with respect to acceptances
or similar obligations issued for the account of such Person;
(h) all obligations of such Person under a product financing
or similar arrangement described in paragraph 8 of FASB Statement of Accounting
Standards No. 49 or any similar requirement of GAAP;
(i) all obligations of such Person under any Interest Rate
Hedging Agreement or any currency protection agreement, currency future, option
or swap or other currency hedge agreement;
(j) all Guaranties of such Person; and
(k) all obligations of such Person under, or in respect of,
any Synthetic Leases.
Indebtedness shall not include accounts payable to trade creditors arising out
of purchases of goods or services in the ordinary course of business, provided
that (i) such accounts payable are payable on usual and customary trade terms,
and (ii) such accounts payable are not overdue by more than 60 days according to
the original terms of sale except (if no foreclosure, distraint, levy, sale or
similar proceeding shall have been commenced) where such payments are being
contested in good faith by appropriate proceedings diligently conducted and
subject to such reserves or other appropriate provisions as may be required by
GAAP.
"Indemnified Parties" means, collectively, the Lender Parties and
their respective Affiliates and (without duplication) the directors, trustees,
officers, employees, attorneys and agents of each of the foregoing.
"Interest Expense" means, for any Person, for any period, the sum
(without duplication) of (a) all interest accrued (or accreted) on Indebtedness
of such Person during such period whether or not actually paid (excluding any
obligations under any Synthetic Leases) plus (b) the net amount accrued under
any Interest Rate Hedging Agreements (or less the net amount receivable
thereunder) during such period.
"Interest Period" means with respect to any LIBO Rate Loan, (a)
initially, the period commencing on the borrowing or conversion date, as the
case may be, and ending one, two, three or six months thereafter as selected by
the Borrowers pursuant to Section 1.8 above and (b) thereafter, each period
commencing on the day after the last day of the preceding Interest Period and
ending one, two, three or six months thereafter, as selected by the Borrower
pursuant to Section 1.8 above provided, however, if any such Interest Period
would otherwise end on a day which is not a Eurodollar Business Day, such
Interest Period shall be extended to the next succeeding Eurodollar Business Day
unless the result of such extension would be to carry such Interest Period into
another calendar month in which event such Interest Period shall end on the
immediately preceding Eurodollar Business Day and provided, further, if any such
Interest Period begins on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period (as may be the case
with an Interest Period commencing at the end of a calendar month) the Interest
Period shall end on the last Eurodollar Business Day of the relevant calendar
month.
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"Interest Rate Hedging Agreement" means any rate swap, cap or collar
agreement with a term of at least three years or such shorter term as may be
acceptable to the Administrative Agent to which any or all of the Borrowers are
party and which is on terms and conditions satisfactory to the Administrative
Agent.
"Investments" has the meaning set forth in Section 8.3 hereof.
"Issuer" has the meaning ascribed to such term in the preamble
hereto.
"JCAHO" means Joint Commission on Accreditation of Healthcare
Organizations.
"Joinder Effective Date" means the date that any Joining Subsidiary
becomes a Borrower hereunder pursuant to Section 6.10.
"Joinder Supplement" has the meaning set forth in Schedule 6.10
hereto.
"Joining Subsidiary" has the meaning set forth in Section 6.10
hereof.
"Law" means any law (including common law), constitution, statute,
treaty, convention, regulation, rule, ordinance, order, injunction, writ, decree
or award of any Governmental Authority.
"Lender" has the meaning ascribed to such term in the preamble
hereto and shall include the Swing Loan Lender.
"Lender Parties" means, collectively, the Lenders, the Issuer and
the Agents.
"Letter of Credit" means any letter of credit issued by the Issuer
pursuant to Article 3 hereof.
"Letter of Credit Participation" means, with respect to any RC
Lender, the participation interest of such Lender in any Letter of Credit
acquired pursuant to Article 3 above. The amount of the Letter of Credit
Participation of an RC Lender in any Letter of Credit shall be deemed to be the
amount equal to such RC Lender's pro rata share (determined on the basis of the
RC Commitments at such time) of the sum of (a) the aggregate unpaid amount of
all Drawings thereunder at such time and (b) the amount of any Contingent
Reimbursement Obligations with respect thereto at such time.
"LIBO Rate" means the rate per annum determined by the
Administrative Agent by dividing (the resulting quotient to be rounded upward to
the nearest 1/100 of 1%) (a) the rate of interest (which shall be the same for
each day in such Interest Period) determined in good faith by the Administrative
Agent (which determination shall be conclusive) to be the average of the rates
per annum for deposits in Dollars offered to major money center banks in the
London interbank market at approximately 11:00 a.m., London time, two Eurodollar
Business Days prior to the first day of the applicable Interest Period for
delivery on the first day of such Interest Period in similar amounts and
maturities as the proposed LIBO Rate Loan by (b) a number equal to 1.0 minus the
Reserve Percentage. "Reserve Percentage" for any day means the percentage
(expressed as a decimal, rounded
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upward to the nearest 1/100 of 1%), as determined in good faith by the
Administrative Agent (which determination shall be conclusive), which is in
effect on such day as prescribed by the Board of Governors of the Federal
Reserve System representing the maximum reserve requirement (including
supplemental, marginal and emergency reserve requirements) with respect to
eurocurrency funding (currently referred to as "Eurocurrency liabilities") of a
member bank in such System. The LIBO Rate shall be adjusted automatically as of
the effective date of each change in the Reserve Percentage.
"LIBO Rate Loan" means a Loan bearing interest at the per annum rate
of the LIBO Rate plus Applicable Margin.
"Licenses" means any and all licenses, including provisional
licenses, certificates of need, JCAHO and/or other accreditations, permits,
franchises, rights to conduct business, approvals by a Governmental Authority or
otherwise, consents, qualifications, operating authority, and/or any other
authorizations.
"Lien" means any mortgage, deed of trust, pledge, lien, security
interest, charge or other encumbrance or security arrangement of any nature
whatsoever, including but not limited to any conditional sale or title retention
arrangement, and any assignment, deposit arrangement or lease intended as, or
having the effect of, security.
"Limitation" means a revocation, suspension, termination,
impairment, probation, limitation, non-renewal, forfeiture, declaration of
ineligibility, loss of status as a participating provider in a Third Party Payor
Arrangement and/or loss of any other rights.
"Loans" means collectively, the Swing Loans, the Tranche A Term
Loans, the Tranche B Term Loans, the Tranche C Term Loans and the RC Loans.
"Loan" means any of the Loans.
"Loan Documents" means this Agreement, the Notes, the Suretyship
Agreement, Letters of Credit, the Pledge Agreement, each Joinder Supplement and
all other agreements and instruments executed in connection herewith or
therewith, in each case as the same may be amended, modified or supplemented
from time to time.
"Loan Obligations" means all obligations, from time to time, of any
Loan Party to any Lender Party or other Indemnified Party under, or arising out
of, this Agreement or any Loan Document whether such obligations are direct or
indirect, absolute or contingent, due or to become due, now or hereafter
arising, (specifically including obligations arising or accruing after the
commencement of any bankruptcy, insolvency, or similar proceeding with respect
to any Loan Party, or which would have accrued but for the commencement of such
proceeding even if the claim is not allowed in such proceeding under applicable
law).
"Loan Parties" means the Borrowers, the Surety and any other Person
who from time to time grants or purports to grant to the Administrative Agent a
Lien on any property pursuant to the Pledge Agreement or is a Guarantor of any
Loan Obligations.
"Management Agreement" means any agreement pursuant to which a
Person (or group of Persons) manages the business of another Person (or group of
Persons).
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"Material Adverse Effect" means (a) a material adverse effect on the
business, operations, condition (financial or otherwise), properties or
prospects of Multicare or of the Borrowers, taken as a whole, or (b) an adverse
effect on the legality, validity, binding effect or enforceability of any Loan
Document, or the ability of the Administrative Agent or any Lender Party to
enforce any rights or remedies under or in connection with any Loan Document.
Without limiting the generality of the foregoing, as used in connection with any
provisions respecting the ownership or operation of any Health Care Business,
Material Adverse Effect may include, among other things, any loss or suspension
of a License or Reimbursement Approval for any material nursing home or other
material Health Care Business or material group of nursing homes or other
material group of Health Care Businesses of the Borrowers, or any event,
occurrence or matter or series thereof giving rise to a reasonable probability
of any of the foregoing consequences.
"Maturity Date" means the latest of the RC Maturity Date, the
Tranche A Maturity Date, the Tranche B Maturity Date or the Tranche C Maturity
Date or, as the context may require, the applicable maturity date for a
specified Tranche of a Loan.
"Mellon" means Mellon Bank, N.A., a national banking association,
and any successor or assign thereof.
"Merger" means the merger of Acquisition Corp. into Multicare on the
terms stated in the Merger Agreement without any change thereto or waiver of any
provisions thereof not approved by the Required Lenders.
"Merger Agreement" means the Agreement and Plan of Merger dated as
of June 16, 1997, among Multicare, Surety and Acquisition Corp.
"Multicare" has the meaning ascribed to such term in the preamble of
this Agreement.
"Multicare Group" has the meaning ascribed to such term in Section
6.1 hereof.
"Multicare Management Agreement" has the meaning ascribed to such
term in Section 4.1.
"Multicare Management Subordination Agreement" means the
Subordination Agreement among Genesis, Multicare and the Agents dated of even
date herewith whereby Genesis has agreed to subordinate its rights to payments
under the Multicare Management Agreement to the extent and on the terms and
conditions as set forth in the Multicare Management Subordination Agreement,
which such terms and conditions are subject to the Agents' approval.
"Multiemployer Plan" means such term in ss.4001(a)(3) of ERISA.
"Nazem" means Nazem, Inc., a Delaware corporation and (a) any
Subsidiary thereof and (b) any other Affiliate thereof reasonably acceptable to
the Administrative Agent.
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Without limiting the generality of the foregoing, "Nazem" includes Genesis
ElderCare Portfolio K, L.P.
"Net Cash Proceeds" means, with respect to any transaction involving
a Borrower, the gross proceeds thereof in the form of cash or cash equivalents,
net of the sum of the following (without duplication): (a) payments made to
retire obligations (other than to a Borrower) that are attributable to or
secured by the properties that are the subject of a sale, assignment or other
disposition which is part of the transaction, (b) reasonable brokerage
commissions and other reasonable fees and expenses (including reasonable fees
and expenses of legal counsel and investment bankers) related to such
transaction, and (c) all taxes actually paid or estimated in good faith to be or
become payable as a result of such transaction.
"Net Cash Provided by Operations" means for any period, the Net
Income of the Borrowers on a consolidated basis for such period plus
amortization and depreciation expense of the Borrowers for such period plus cash
extraordinary gains (other than from a disposition) less Capital Expenditures of
the Borrowers for such period (to the extent permitted by the terms of this
Agreement), less increases in working capital (or plus decreases in working
capital) of the Borrowers during such period.
"Net Income" means, with respect to any Person, for any period the
net earnings (or loss) after taxes of such Person for such period less
extraordinary gains, plus extraordinary non-cash losses.
"1995 Subordinated Note Indenture" means the Indenture dated as of
June 15, 1995 between Genesis and Delaware Trust Company, as Trustee, relating
to the 1995 Subordinated Notes, as such Indenture may be amended, modified,
restated or supplemented from time to time in accordance with the terms of this
Agreement.
"1995 Subordinated Notes" means Genesis' 9-3/4% Senior Subordinated
Notes issued pursuant to the 1995 Subordinated Note Indenture in the original
aggregate principal amount of $120,000,000.00.
"1996 Subordinated Note Indenture" means the Indenture, dated as of
October 7, 1996, between Genesis and First Union National Bank, as Trustee,
relating to the 1996 Subordinated Notes, as such Indenture may be amended,
modified, restated or supplemented from time to time in accordance with the
terms of this Agreement.
"1996 Subordinated Notes" means Genesis' 9 1/4% Senior Subordinated
Notes issued pursuant to the 1996 Subordinated Note Indenture, in the original
aggregate principal amount of $125,000,000.00.
"1997 Subordinated Note Indenture" means the Indenture, dated as of
August 11, 1997 between Acquisition Corp., PNC Bank, National Association as
trustee, and Banque Internationale a Luxembourg, S.A. as paying agent, relating
to the 1997 Subordinated Notes, as such Indenture may be amended, modified or
supplemented from time to time in accordance with the terms of this Agreement.
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"1997 Subordinated Notes" means Acquisition Corp.'s 9% Senior
Subordinated Note issued pursuant to the 1997 Subordinated Note Indenture, in
the original principal amount of $250,000,000.00.
"Non-U.S. Lender" means any Lender that is not a United States
Person.
"Notes" means, collectively, the Swing Loan Note, the Tranche A Term
Notes, and the RC Notes. A "Note" means any of the Notes.
"Officer's Compliance Certificate" means a certificate, as of a
specified date, of the chief financial officer or controller of Multicare in
substantially the form of Exhibit G hereto as to each of the following: (a) the
absence of any Event of Default or Default on such date, (b) the truth of the
representations and warranties herein and in the other Loan Documents as of such
date, and (c) compliance (or if required by the terms of this Agreement
respecting the delivery of any such Officer's Compliance Certificate, pro forma
compliance after taking account of such acquisitions, dispositions, indebtedness
or other events as this Agreement shall direct for such pro forma compliance
statement) with the financial covenants set forth in Article 7 and the financial
limitations set forth in Sections 8.1(e), 8.2(e), 8.3(i), 8.4(b), 8.5(h), and
8.7(c).
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
"Pension Plan" means a pension plan (as defined in ss.3(2) of ERISA)
which is subject to Part 3 of Subtitle B of Title I of ERISA or subject to
ss.412 of the Code and maintained by any Borrower or any member of its
Controlled Group.
"Permitted Liens" has the meaning set forth in Section 8.2 above.
"Person" means an individual, corporation, partnership, trust,
unincorporated association, limited liability company, joint venture,
joint-stock company, Governmental Authority or any other entity.
"Plan" means an employee benefit plan (other than a Multiemployer
Plan) as defined in ss.3(3) of ERISA which is either (1) maintained by any
Borrower or any member of its Controlled Group, or (2) maintained pursuant to a
collective bargaining agreement or any other arrangement under which more than
one employer makes contributions and to which any Borrower or any member of its
Controlled Group is then making or accruing an obligation to make contributions
or has ever been obligated to make contributions.
"Pledge Agreement" has the meaning ascribed to such term in Section
4.1 hereof.
"Premises" has the meaning set forth in Section 12.12 hereof.
"Prime Rate" means the greater of (A) the interest rate per annum
announced from time to time by the Administrative Agent as its prime rate or (B)
the Federal Funds Rate plus .50%. The Prime Rate may be greater or less than
other interest rates charged by the Administrative Agent to other borrowers.
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"Prime Rate Loan" means any Loan bearing interest at the Prime Rate
plus the Applicable Margin.
"Prohibited Transaction" has the meaning given to such term in
ss.406 of ERISA or ss.4975(c) of the Code.
"Qualifying Interest Rate Hedging Agreements" means such Interest
Rate Hedging Agreements as may be entered into from time to time pursuant to
Section 6.12 above between any or all of the Borrowers, on the one hand, and any
Lender Party, on the other hand.
"Quarterly Payment Date" means the last Business Day of each
December, March, June and September.
"RC Commitment" means, with respect to any RC Lender, (i) the amount
set forth opposite such Lender's name under the heading "RC Commitment" on
Schedule 1.1 hereto or, in the case of a Lender that becomes a Lender pursuant
to an assignment, the amount of the assignor's RC Commitment assigned to such
Lender, in either case as the same may be reduced from time to time pursuant to
Section 1.7 above or increased or reduced from time to time pursuant to
assignments in accordance with Section 12.9 below or (ii) as the context may
require, the obligation of such Lender to make RC Loans in an aggregate unpaid
principal amount not exceeding such amount; and "RC Commitment" means with
respect to all RC Lenders, the sum of each RC Lender's RC Commitment.
"RC Lender" means (i) any Lender with an "RC Commitment" designated
on Schedule 1.1 hereto and (ii) any Person that is assigned any or all of the
rights or obligations of an RC Lender with respect to its RC Commitment or RC
Loans, from time to time, pursuant to Section 12.9.
"RC Loans" has the meaning ascribed to such term in Section 1.1 of
this Agreement.
"RC Maturity Date" means September 30, 2003.
"RC Note" means each promissory note of the Borrowers issued to an
RC Lender relating to such Lender's RC Loans and RC Commitments substantially in
the form of Exhibit A-1 hereto, together with any allonges thereto, from time to
time, and any promissory note issued in substitution therefor pursuant to the
terms hereof, together with all extensions, renewals, refinancings or refundings
thereof in whole or part, in each case as the same may be amended, modified,
restated or supplemented from time to time.
"Register" has the meaning ascribed to such term in Section 10.8
hereof.
"Registered Lender" has the meaning ascribed to such term in Section
1.14 hereof.
"Registered Noteholder" has the meaning ascribed to such term in
Section 1.14 hereof.
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"Regulatory Change" means any applicable law, interpretation,
directive, request or guideline (whether or not having the force of law), or any
change therein or in the administration or enforcement thereof, that becomes
effective or is implemented or first required or expected to be complied with
after the Agreement Date (including any applicable law that shall have become
such as the result of any act of omission of the Borrowers or any of their
Affiliates, without regard to when such applicable law shall have been enacted
or implemented), whether the same is (i) the result of an enactment by a
government or any agency or political subdivision thereof, a determination of a
court or regulatory authority or otherwise or (ii) enacted, adopted, issued or
proposed before or after the Agreement Date, including any such that imposes,
increases or modifies any Tax, reserve requirement, insurance charge, special
deposit requirement, assessment or capital adequacy requirement, but excluding
any such that imposes, increases or modifies any Bank Tax.
"Reimbursement Approvals" means, with respect to all Third Party
Payor Arrangements, any and all certifications, provider numbers, provider
agreements, participation agreements, accreditations (including JCAHO
accreditation) and/or any other agreements with or approvals by organizations
and Governmental Authorities.
"Rental Expense" means, with respect to any Person for any period,
the aggregate rental obligations of such Person, payable in respect of any
leases (including Synthetic Leases but excluding Capitalized Leases) during such
period, but in any case including obligations for taxes, insurance, maintenance
and similar costs which the lessee is obligated to pay under the terms of such
leases and which are attributable to the leases for such period (whether such
amounts are accrued or paid during such period).
"Required Lenders" means, as of any date, Lenders otherwise eligible
to vote pursuant to the terms of this Agreement holding, in the aggregate, at
least 51% of the aggregate outstanding Loans, participations in Letters of
Credit and available Commitments so eligible to vote.
"Responsible Officer" of a Person means the President, the
Secretary, the Chief Executive Officer, any Vice President, the Controller, the
Treasurer or the Chief Financial Officer of such Person.
"Restricted Subsidiaries" means all direct and indirect Subsidiaries
of Multicare at any time, other than Excluded Subsidiaries.
"Secured Parties" has the meaning ascribed to such term in the
Pledge Agreement.
"Subsidiary" of a Person at any time means:
(a) any corporation of which a majority (by number of shares
or number of votes) of any class of outstanding capital stock
normally entitled to vote for the election of one or more directors
(regardless of any contingency which does or may suspend or dilute
the voting rights of such class) is at such time owned directly or
indirectly, beneficially or of record, by such Person or one or more
Subsidiaries of such Person;
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(b) any trust of which a majority of the beneficial interest
is at such time owned directly or indirectly, beneficially or of
record, by such Person or one or more Subsidiaries of such Person;
(c) any partnership, limited liability company, joint venture
or other entity of which ownership interests having ordinary voting
power to elect a majority of the board of directors or other Persons
performing similar functions are at such time owned directly or
indirectly, beneficially or of record, by, or which is otherwise
controlled directly, indirectly or through one or more
intermediaries by, such Person or one or more Subsidiaries of such
Person; or
(d) any entity which is consolidated with such Person for
financial reporting purposes.
"Surety" has the meaning ascribed to such term in Section 4.1
hereof.
"Suretyship Agreement" has the meaning ascribed to such term in
Section 4.1 hereof.
"Swing Loan" means an amount advanced by the Swing Loan Lender
pursuant to Section 1.1(c) hereof.
"Swing Loan Lender" means Mellon, in its capacity as such.
"Swing Loan Note" means the promissory note of the Borrowers issued
to the Swing Loan Lender in substantially the form of Exhibit A-3 hereto,
together with any allonges thereto from time to time and any promissory note
issued in substitution therefor pursuant to the terms hereof, together with all
extensions, renewals, refinancings or refundings thereof in whole or in part, in
each case as the same may be amended, modified, restated or supplemented from
time to time.
"Synthetic Lease" means any lease (other than a Capitalized Lease)
wherein the lessee is treated (or purported to be treated) as the owner of the
leased property for income tax purposes.
"Tax" means any federal, state, local or foreign tax assessment or
other governmental charge or levy (including any withholding tax) upon a Person
or upon its assets, revenues, income or profits.
"Tax Sharing Agreement" has the meaning ascribed to such term in
Section 4.1 hereof.
"Tender Offer" means Acquisition Corp.'s offer to purchase the
outstanding common shares of Multicare as contained in its "Offer to Purchase
for Cash All Outstanding Shares of Common Stock of Multicare Companies" dated
June 20, 1997, as extended from time to time.
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"Term Loans" means collectively the Tranche A Term Loans, the
Tranche B Term Loans and the Tranche C Term Loans.
"Third Party Claims" has the meaning set forth in Section 12.12
hereof.
"Third Party Payor Arrangements" means any and all arrangements with
Medicare, Medicaid, CHAMPUS, and any other Governmental Authority, or
quasi-public agency, Blue Cross, Blue Shield, any and all managed care plans and
organizations, including but not limited to HMOs and preferred provider
organizations, private commercial insurance companies, employee assistance
programs and/or any other third party arrangements, plans or programs for
payment or reimbursement in connection with health care services, products or
supplies.
"Total Funded Indebtedness" means the aggregate amount of
consolidated Indebtedness (including the current portion thereof), of Multicare
and its Restricted Subsidiaries (including all Indebtedness consisting of
Capitalized Lease Obligations, Synthetic Leases, Guaranties and letter of credit
reimbursement obligations).
"TPG" means TPG Partners II, L.P., a Delaware limited partnership
and (a) any Subsidiary thereof and (b) any other Affiliate thereof reasonably
acceptable to the Administrative Agent. Without limiting the generality of the
foregoing, "TPG" includes TPG Parallel II, L.P., TPG Investors II, L.P. and TPG
MC Coinvestment, L.P.
"Tranche" means the designation of a Loan as an RC Loan, a Tranche A
Term Loan, a Tranche B Term Loan or a Tranche C Term Loan and the designation of
the related Commitment as an RC Commitment, a Tranche A Commitment, a Tranche B
Commitment or a Tranche C Commitment as applicable.
"Tranche A Commitment" means, (1) with respect to any Tranche A
Lender, (a) at any time prior to the Closing Date, (i) the amount set forth
opposite such Lender's name under the heading "Tranche A Commitment" on Schedule
1.1 hereto or, in the case of a Lender that becomes a Lender pursuant to an
assignment, the amount of the assignor's Tranche A Commitment assigned to such
Lender, in either case as the same may be increased or reduced from time to time
pursuant to assignments in accordance with Section 12.9 or (ii) as the context
may require, the obligation of such Lender to make Tranche A Loans in an
aggregate unpaid principal amount not exceeding such amount, and (b) thereafter,
zero; and (2) with respect to all Tranche A Lenders, the sum of each Lender's
Tranche A Commitment.
"Tranche A Lender" means (a) any Lender with a "Tranche A
Commitment" designated on Schedule 1.1 hereto and (b) any Person that is
assigned any or all of the rights or obligations of a Tranche A Lender with
respect to its Tranche A Commitment or Tranche A Term Loans, from time to time,
pursuant to Section 12.9.
"Tranche A Maturity Date" means September 30, 2003.
"Tranche A Term Loan" has the meaning ascribed to that term in
Section 1.1 of this Agreement.
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"Tranche A Term Note" means each promissory note of the Borrowers
issued to a Tranche A Lender relating to such Lender's Tranche A Loans and
Tranche A Commitment substantially in the form of Exhibit A-2 hereto, together
with any allonges thereto from time to time and any promissory note issued in
substitution therefor pursuant to the terms hereof, together with all
extensions, renewals, refinancings or refundings thereof in whole or part, in
each case as the same may be amended, modified, restated or supplemented from
time to time.
"Tranche B Commitment" means, (1) with respect to any Tranche B
Lender, (a) at any time prior to the Closing Date, (i) the amount set forth
opposite such Lender's name under the heading "Tranche B Commitment" on Schedule
1.1 hereto or, in the case of a Lender that becomes a Lender pursuant to an
assignment, the amount of the assignor's Tranche B Commitment assigned to such
Lender, in either case as the same may be increased or reduced from time to time
pursuant to assignments in accordance with Section 12.9, or (ii) as the context
may require, the obligation of such Lender to make Tranche B Term Loans in an
aggregate unpaid principal amount not exceeding such amount, and (b) thereafter,
zero; and (2) with respect to all Tranche B Lenders, the sum of each Lender's
Tranche B Commitment.
"Tranche B Lender" means (i) any Lender with a "Tranche B
Commitment" designated on Schedule 1.1 hereto and (ii) any Person that is
assigned any or all of the rights or obligations of a Tranche B Lender with
respect to its Tranche B Commitment or Tranche B Term Loans, from time to time,
pursuant to Section 12.9.
"Tranche B Maturity Date" means September 30, 2004.
"Tranche B Opt-Out Lender" has the meaning ascribed to such term in
Section 1.5 hereof.
"Tranche B Term Loan" has the meaning ascribed to that term in
Section 1.1 of this Agreement.
"Tranche C Commitment" means (1) with respect to any Tranche C
Lender, (a) at any time on or prior to the Closing Date, (i) the amount set
forth opposite such Lender's name under the heading "Tranche C Commitment" on
Schedule 1.1 hereto or, in the case of a Lender that becomes a Lender pursuant
to an assignment, the amount of the assignor's Tranche C Commitment assigned to
such Lender, in either case as the same may be increased or reduced from time to
time pursuant to assignments in accordance with Section 12.9, (ii) as the
context may require, the obligation of such Lender to make Tranche C Term Loans
in an aggregate unpaid principal amount not exceeding such amount, and (b)
thereafter, zero; and (2) with respect to all Tranche C Lenders, the sum of each
Lender's Tranche C Commitment.
"Tranche C Lender" means (i) any Lender with a "Tranche C
Commitment" designated on Schedule 1.1 hereto and (ii) any Person that is
assigned any or all of the rights or obligations of a Tranche C Lender with
respect to its Tranche C Commitment or Tranche C Term Loans, from time to time,
pursuant to Section 12.9.
"Tranche C Maturity Date" means June 1, 2005.
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"Tranche C Opt-Out Lender" has the meaning ascribed to such term in
Section 1.5 hereof.
"Tranche C Term Loan" has the meaning ascribed to that term in
Section 1.1 of this Agreement.
"Transaction Documents" means each of the material documents as may
exist on the date that the Tender Offer is consummated with such changes thereto
as are permitted by the terms of this Agreement respecting (i) the Tender Offer,
(ii) the proposed merger between the Acquisition Corp. and Multicare, (iii) the
relationship between Genesis, Cypress, Nazem and TPG and the rights and
obligations relating thereto and (iv) related matters including the Put/Call
Agreement and the Stockholders Agreement respecting Surety, the Merger Agreement
and the Multicare Management Agreement.
"Type" means with respect to Loans, any of the following, each of
which shall be deemed to be a different "Type" of Loan: Prime Rate Loans, LIBO
Rate Loans having a one-month Interest Period commencing on a specified date,
LIBO Rate Loans having a two-month Interest Period commencing on a specified
date, LIBO Rate Loans having a three-month Interest Period and LIBO Rate Loans
having a six-month Interest Period commencing on a specified date.
"United States Person" has the meaning ascribed to such term in
Section 1.13 hereof.
"Withdrawal Liability" has the meaning given to such term in ss.4201
of ERISA.
11.2 CONSTRUCTION. In this Agreement and each other Loan Document, unless
the context otherwise clearly requires,
(a) references to the plural include the singular, the singular the
plural and the part the whole;
(b) "or" has the inclusive meaning represented by the phrase
"and/or;"
(c) the terms "property" and "assets" each include all properties
and assets of any kind or nature, tangible or intangible, real, personal or
mixed, now existing or hereafter acquired;
(d) the words "hereof," "herein" and "hereunder" (and similar terms)
in this Agreement or any other Loan Document refer to this Agreement or such
other Loan Document, as the case may be, as a whole and not to any particular
provision of this Agreement or such other Loan Document;
(e) the words "includes" and "including" (and similar terms) in this
Agreement or any other Loan Document mean "includes, without limitation" and
"including, without limitation," respectively whether or not stated; and
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(f) references to "determination" (and similar terms) by any Lender
Party include good faith estimates by such Lender Party (in the case of
quantitative determinations) and good faith beliefs by such Lender Party (in the
case of qualitative determinations).
No doctrine of construction of ambiguities in agreements or instruments against
the interests of the party controlling the drafting thereof shall apply to this
Agreement or any other Loan Document. The section and other headings contained
in this Agreement and in each other Loan Document, and any tables of contents
contained herein or therein, are for reference purposes only and shall not
affect the construction or interpretation of this Agreement or such other Loan
Document in any respect. Whenever this Agreement requires the delivery of
financial projections, it is understood that the projections shall be made in
good faith, consistent with the Loan Documents and based on Multicare's
reasonable judgment as to the anticipated financial performance and results of
operations. However, any such financial projections shall not constitute a
representation or warranty that such future financial performance or results of
operations will in fact be achieved.
11.3 ACCOUNTING PRINCIPLES.
(a) As used herein, "GAAP" shall mean generally accepted accounting
principles (other than as set forth herein as to consolidation) in the United
States, applied on a basis consistent with the principles used in preparing the
financial statements of Multicare and its consolidated Subsidiaries as of
December 31, 1996 and for the fiscal year then ended. When the word
"consolidated" is used in this Agreement, it shall be used in a manner
consistent with generally accepted accounting principles in the United States
except that such principles relating to what entities shall be consolidated
shall be superseded by any terms of this Agreement which designate what entities
shall be consolidated for purposes relating hereto.
(b) Except as otherwise provided in this Agreement, all computations
and determinations as to accounting or financial matters shall be made, and all
financial statements to be delivered pursuant to this Agreement shall be
prepared, in accordance with GAAP and all accounting or financial terms shall
have the meanings ascribed to such terms by GAAP.
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ARTICLE 12
MISCELLANEOUS
12.1 NOTICES. Unless otherwise expressly provided under this Agreement all
notices, requests, demands, directions and other communications (collectively
"notices") given to or made upon any party under the provisions of this
Agreement (and unless otherwise specified, in each other Loan Document) shall be
by telephone (immediately confirmed in writing) or in writing (including
facsimile communication) and if in writing shall be delivered by hand,
nationally recognized overnight courier or U.S. mail or sent by facsimile to the
respective parties at the addresses and numbers set forth under their respective
names on the signature pages of this Agreement or in accordance with any
subsequent unrevoked written direction from any party to the others. All notices
shall, except as otherwise expressly provided in this Agreement, be effective
(a) in the case of facsimile, when received, (b) in the case of hand-delivered
notice, when hand delivered, (c) in the case of telephone, when telephoned,
provided, however, that in order to be effective unless otherwise expressly
provided, telephonic notices must be confirmed in writing no later than the next
day by letter or facsimile, (d) if given by U.S. mail, the day after such
communication is deposited in the mails with overnight first class postage
prepaid, return receipt requested, and (e) if given by any other means
(including by air courier), when delivered; provided, further, that notices to
the Administrative Agent shall not be effective until received. Any Lender
giving any notice to the Borrowers shall simultaneously send a copy of such
notice to the Administrative Agent, and the Administrative Agent shall promptly
notify the other Lenders of the receipt by it of any such notice. Except as
otherwise provided in this Agreement, in the event of a discrepancy between any
telephonic or written notice, the written notice shall control.
12.2 PRIOR UNDERSTANDINGS; ENTIRE AGREEMENT. This Agreement and the other
Loan Documents supersede all prior and contemporaneous understandings and
agreements, whether written or oral, among the parties hereto relating to the
transactions provided for herein and therein except as expressly provided
otherwise (e.g., certain fee agreements and fee arrangements set forth in the
commitment letter relating hereto). This Agreement and the other Loan Documents
represent the entire agreement between the parties to this Agreement with
respect to the transactions contemplated hereby or thereby and, except as
expressly provided herein or in the other Loan Documents, shall not be affected
by reference to any other documents.
12.3 SEVERABILITY. Every provision of this Agreement and each of the other
Loan Documents is intended to be severable, and if any term or provision of this
Agreement or any of the other Loan Documents shall be invalid, illegal or
unenforceable for any reason, the validity, legality and enforceability of the
remaining provisions shall not be affected or impaired thereby, and any
invalidity, illegality or unenforceability in any jurisdiction shall not affect
the validity, legality or enforceability of any such term or provision in any
other jurisdiction. If any provision of this Agreement shall be held invalid or
unenforceable in whole or in part in any jurisdiction, this Agreement shall, as
to such jurisdiction, be deemed amended to modify or delete, as necessary, the
offending provision or provisions and to alter
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the bounds thereof in order to render it or them valid and enforceable to the
maximum extent permitted by applicable Law, without in any manner affecting the
validity or enforceability of such provision or provisions in any other
jurisdiction or the remaining provisions hereof in any jurisdiction.
12.4 DESCRIPTIVE HEADINGS. The descriptive headings of the several
sections of this Agreement are inserted for convenience only and shall not
affect the meaning or construction of any of the provisions of this Agreement.
12.5 GOVERNING LAW. This Agreement and the rights and obligations of the
parties under this Agreement and under the other Loan Documents shall be
construed in accordance with and shall be governed by the laws of the
Commonwealth of Pennsylvania.
12.6 NON-MERGER OF REMEDIES. The covenants and obligations of the
Borrowers and the rights and remedies of the Administrative Agent and other
Lender Parties hereunder and under the other Loan Documents shall not merge with
or be extinguished by the entry of a judgment hereunder or thereunder, and such
covenants, obligations, rights and remedies shall survive any entry of a
judgment until payment in full of the Loan Obligations and termination of the
Commitment. All obligations under the Loan Documents shall continue to apply
with respect to and during the collection of amounts due under the Loan
Documents or the proof and allowability of any claim arising under this
Agreement or any other Loan Document, whether in bankruptcy or receivership
proceedings or otherwise, and in any workout, restructuring or in connection
with the protection, preservation, exercise or enforcement of any of the terms
of this Agreement or of any rights under this Agreement or under any other Loan
Document or in connection with any foreclosure, collection or bankruptcy
proceedings. Without limiting the generality of the foregoing, post-judgment
interest rate shall be the interest rate provided in paragraph (d) of Section
1.8 (Default Rate) above.
12.7 NO IMPLIED WAIVER; CUMULATIVE REMEDIES. No course of dealing and no
delay or failure of the Administrative Agent or any other Lender Party in
exercising any right, power or privilege under this Agreement or any other Loan
Document shall affect any other or future exercise thereof or exercise of any
other right, power or privilege; nor shall any single or partial exercise of any
such right, power or privilege or any abandonment or discontinuance of steps to
enforce such a right, power or privilege preclude any further exercise thereof
or of any other right, power or privilege. The rights and remedies of the
Administrative Agent and the other Lender Parties under this Agreement and any
other Loan Document are cumulative and not exclusive of any rights or remedies
which the Administrative Agent or any other Lender Party would otherwise have
hereunder or thereunder, at law, in equity or otherwise. Any waiver of a
specific default made in accordance with Section 12.8 below shall be effective
only as to such specific default and shall not apply to any subsequent default.
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12.8 AMENDMENTS; WAIVERS. Any term, covenant, agreement or condition of
any Loan Document to which the Lenders (or the Administrative Agent) are party
may be amended, and any right under the Loan Documents may be waived, if, but
only if, such amendment or waiver is in writing and is signed by the Required
Lenders (or by the Administrative Agent at the direction of the Required
Lenders); provided, however, if the rights and duties of the Administrative
Agent are affected thereby, such amendment or waiver must be executed by the
Administrative Agent; and provided, further, that any amendment or waiver of the
terms of Article 3 hereof or any other amendment or waiver that relates to
Letters of Credit or rights or obligations relating thereto or the rights or
obligations of the Issuer must also be executed by the Issuer; and provided,
further, that no such amendment or waiver shall be effective unless in writing
and signed by each Lender referred to below, if it would
(a) increase such Lender's Commitment or the outstanding
amount of such Lender's Loans or Letters of Credit Participations, or
(b) extend the maturity of any Loan held by such Lender, or
the time of any scheduled principal payment of any Loan of such Lender;
(c) decrease the rate of interest or amount of fees due to
such Lender or decrease the principal amount in respect of any Loan of
such Lender or extend the time of payment of interest or fees due to such
Lender, provided that the written consent of the Required Lenders, rather
than the consent of all Lenders, shall be sufficient to waive imposition
of the Default Rate,
(d) reduce or waive any payment owing to such Lender in
respect to any unreimbursed Drawings; or
(e) change the number of Lenders which are required to consent
to any proposed action under this Agreement before such action may be
taken under this Agreement if such change could cause such Lender to lose
its right to participate in such consent;
and provided, further, that no such amendment or waiver shall be effective
unless in writing and signed by all the Lenders if it would
(i) amend the definition of "Required Lenders" or
(ii) release any Borrower of its Obligations or release
any guaranty or collateral security granted pursuant to the Loan
Documents;
provided, however, the Administrative Agent may, without the consent of any
Person, release any Borrower, guarantor or collateral security granted pursuant
to the Loan Documents, (A) as a court of competent jurisdiction may direct, or
(B) in connection with a disposition permitted under Section 8.5 above (other
than a disposition to another Borrower) or as may be otherwise provided under
the Loan Documents and provided further that for purposes of determining
whether" all Lenders", "the Required Lenders" or "any Lender" has consented to
any amendment or waiver, no effect shall be given to the determination of any
Lender who has lost its right to vote pursuant to Sections 1.3(c), 1.3(e)(ii),
or 1.6(e).
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Without limiting the generality of the foregoing, the Administrative Agent is
authorized and directed to take such action as it deems necessary or desirable
(including, without limitation, the execution and filing of UCC-3 termination
statements or the giving of direction to another Person to do the same) to
release any security interest referred to in the proviso to this clause (ii).
Further, the Administrative Agent and the Lenders may amend or modify the
provisions of Article 10 hereof (except for Section 10.9 (Successor
Administrative Agent) and paragraph (b) of Section 10.12 (Other Agents) and
Article 10A hereof) without the need for any consent or approval from the
Borrowers, it being acknowledged that the Borrowers are not third party
beneficiaries of the provisions of said Article 10 (except for Section 10.9
(Successor Administrative Agent) and paragraph (b) of Section 10.12 (Successor
Agent)) and (y) without the consent of any Lenders, the Administrative Agent may
enter into amendments and modifications to this Agreement and the other Loan
Documents as necessary or desirable to cure any ambiguities herein or therein or
to add additional Borrowers or add additional Collateral. Reference is made to
Article 10A of the Genesis Credit Agreement which affects the right of the
parties hereto to amend certain provisions set forth in Section 12.9 below
without the consent of certain Lenders party thereto; accordingly, when amending
Section 12.9 below, consideration shall be given to the provisions of said
Section 10A of the Genesis Credit Agreement.
12.9 SUCCESSORS AND ASSIGNS
(a) Assignments by the Borrowers. Without the prior written consent
of all of the Lenders, no Borrower may assign any of its rights or delegate any
of its duties or obligations under this Agreement or any other Loan Document.
(b) Participations. Any Lender or the Issuer may sell participations
to one or more Eligible Institutions of all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment); provided, however, that, with respect to any Lender,
(i) such Lender's obligations under this Agreement shall remain unchanged, (ii)
such Lender shall remain solely responsible to the other parties to this
Agreement for the performance of such obligations, (iii) all amounts payable by
the Borrowers under this Agreement shall be determined as if such transferor
Lender had not sold such participation and no participant shall be entitled to
receive any greater amount pursuant to this Agreement than the transferor Lender
would have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such participant had no
such transfer occurred, (iv) such participant shall agree to be bound by the
provisions of this Agreement and the other Loan Documents, (v) with respect to
any sale of a participation in any Tranche hereunder, such Lender shall
contemporaneously sell to the same participant a proportionately equal amount of
its interest in the same Tranche under the Genesis Credit Agreement, and (vi)
the Borrowers, the Administrative Agent and the other Lenders shall continue to
deal solely and directly with such transferor Lender in connection with such
Lender's rights and obligations under this Agreement, and such Lender shall
retain the sole rights and responsibility vis-a-vis the Borrowers to enforce the
obligations of the Borrowers relating to the Loans and Letters of Credit
including the right to approve any amendment, modification or waiver of any
provision of this Agreement (except that such Lender may give its participants
the right to
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direct such Lender to approve or disapprove any amendment, modification or
waiver which would require such Lender's consent under clause (a) (b), (c), of
the preceding Section 12.8).
(c) Assignments by Lenders. Each Lender and the Issuer may assign to
one or more Eligible Institutions all or a portion of its interest, rights and
obligations under this Agreement (including all or a portion of its Commitment)
and the other Loan Documents; provided, however, that with respect to any
assignment, (i) unless the assignee is (prior to the effective time of the
assignment) an existing Lender or the Issuer or an Affiliate of an existing
Lender or the Issuer, the Administrative Agent and, if no Event of Default has
occurred and is continuing, Multicare (on behalf of the Borrowers) must give
their prior written consent to such assignment (which consent shall not be
unreasonably withheld), (ii) the parties to each such assignment shall execute
and deliver to the Administrative Agent and, unless an Event of Default has
occurred and is continuing, Multicare (on behalf of the Borrowers), for their
acceptance, an Assignment and Acceptance Agreement in substantially the form
attached hereto as Exhibit H (an "Assignment and Acceptance"), together with (A)
any Note subject to such assignment, and (B) a processing and recordation fee of
$3,500.00, (or such lesser amount as is required for the Administrative Agent to
receive an aggregate amount equal to $3,500.00 under this Agreement and the
Genesis Credit Agreement in respect of such transfer), (iii) no Lender may make
a partial assignment if the amount of its portion of the Commitment and (without
duplication) the outstanding Loans and Letter of Credit Participations, together
with the amount of its interest under the Genesis Credit Agreement assigned in
accordance with clause (v) below, is, or after giving effect to the proposed
assignment would be, less than Ten Million Dollars ($10,000,000.00), (iv) unless
the assignee is (prior to the effective time of the assignment) the Issuer or a
Lender hereunder, the aggregate amount of any interest so sold to any assignee
pursuant to any partial assignment hereunder, together with the aggregate amount
so sold to such assignee in accordance with clause (v) below, may not be less
than Ten Million Dollars ($10,000,000.00), and (v) with respect to any
assignment of an interest in any Tranche hereunder, the assignor shall
contemporaneously assign to the same assignee a proportionately equal amount of
its interest in the same Tranche under the Genesis Credit Agreement.
The requirements set forth in paragraphs (iii) and (iv) above and
the requirements as to an assignee being an Eligible Institution shall not apply
to certain assignments approved by the Administrative Agent and Genesis (on
behalf of the Borrowers) prior to the Agreement Date. "Partial assignment" as
used in clauses (iii) and (iv) above means any assignment of a Lender's rights
and obligations hereunder except an assignment of all of such Lender's rights
and obligations such that after the assignment such Lender shall have no
Commitment and no interest in any Loans or Letters of Credit hereunder. Upon
compliance with clauses (i) through (v) above, from and after the effective date
specified in the relevant Assignment and Acceptance, (1) the assignee shall be a
party to this Agreement and the other Loan Documents and to the extent provided
in such Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement and under the other Loan Documents and (2) the assigning
Lender shall, to the extent provided in such Assignment and Acceptance, be
released from its obligations under this Agreement and the other Loan Documents.
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(d) Procedures Respecting Assignment. Upon their receipt of an
Assignment and Acceptance executed by the assignor and the assignee, subject to
the conditions set forth in the preceding paragraph (c), the Administrative
Agent and (unless an Event of Default shall have occurred and be continuing)
Multicare (on behalf of the Borrowers) shall accept such Assignment and
Acceptance. If the subject assignment is of an interest in the Tranche A
Commitment and Tranche A Term Loan and/or RC Commitment and RC Loans, within
thirty (30) days after such Assignment and Acceptance is signed and accepted by
all parties and made effective, the Borrowers, at their own expense, shall
execute and deliver to the Administrative Agent new Notes in exchange for the
surrendered Notes, each to the order of such assignee in an amount equal to its
portion of the Commitment and Loans, assigned to it pursuant to such Assignment
and Acceptance and new Notes to the order of the assigning Lender in an amount
equal to the Commitment and Loans retained by it. Such Notes shall be in an
aggregate principal amount equal to the aggregate principal amount of such
surrendered Notes, shall be dated the date of such surrendered Notes (each
assignee shall confirm in the Assignment and Acceptance that, notwithstanding
the date of the new Notes made in favor of such assignee, such assignee shall
have no right to, or interest in, any fees or interest which shall have accrued
on the Loans prior to the effective date of the Assignment and Acceptance).
Cancelled or replaced Notes shall be returned to the Borrowers upon the
execution of such new Notes.
(e) Assignments to Federal Reserve Bank. Notwithstanding any of the
terms of this Section 12.9, without the consent of the Administrative Agent and
the Borrowers, (i) any Lender may assign all or any portion of its rights to
payments in connection with this Agreement to a Federal Reserve Bank as
collateral in accordance with Regulation A of the Board of Governors of the
Federal Reserve System and (ii) in the case of any Lender that is a fund, any
such Lender may collaterally assign or pledge any portion of its Loans (other
than RC Loans) and its Notes (other than RC Notes) to its trustee (if such
trustee is an Eligible Institution) in support of its obligations to such
trustee, provided, however, that before any other transfer may be made to such
trustee (whether as a result of such collateral assignment or pledge or
otherwise) the conditions of paragraphs (c) and (d) above must be satisfied.
Such assignment shall not affect any other rights or any obligations of the
assigning Lender
12.10 COUNTERPARTS; PHOTOCOPIED OR TELECOPIED SIGNATURE PAGES. Any Loan
Document may be executed in one or more counterparts, each of which shall
constitute an original, but all of which together shall constitute one and the
same instrument. Delivery of a photocopy or telecopy of an executed counterpart
of a signature page to any Loan Document shall be as effective as delivery of a
manually executed counterpart of such Loan Document.
12.11 MAXIMUM LAWFUL INTEREST RATE. Notwithstanding any provision
contained in this Agreement or the Notes or any other Loan Document, the total
liability of the Borrowers for payment of interest pursuant to this Agreement
and the Notes shall not exceed the maximum amount of such interest permitted by
Law to be charged, collected, or received from the Borrowers, and if any payment
by the Borrowers includes interest in excess of such a maximum amount, each
Lender shall apply such excess to the reduction of the unpaid principal amount
due pursuant to this Agreement and the Notes, or if none is due,
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to the other Loan Obligations, if any, and then such excess shall be refunded to
Multicare (on behalf of the Borrowers).
12.12 INDEMNIFICATION.
(a) Whether or not any fundings are made under this Agreement, the
Borrowers jointly and severally shall unconditionally upon demand, pay or
reimburse the Administrative Agent and other Lender Parties for, and indemnify
and save the Administrative Agent, the other Lender Parties and their respective
Affiliates, officers, directors, employees, agents, attorneys, shareholders and
consultants (collectively, "Indemnitees") harmless from and against, any and all
losses, liabilities, claims, damages, expenses, obligations, penalties, actions,
judgments, suits, costs or disbursements of any kind or nature whatsoever
(including the fees and disbursements of counsel for such Indemnitee in
connection with any investigative, administrative or judicial proceeding
commenced or threatened, whether or not such Indemnitee shall be designated a
party thereto) that may at any time be imposed on, asserted against or incurred
by such Indemnitee as a result of, or arising out of, or in any way related to
or by reason of, this Agreement or any other Loan Document, any Acquisition or
transaction from time to time contemplated hereby or by any other Loan Document,
or any transaction actually or proposed to be financed in whole or in part or
directly or indirectly with the proceeds of any Loan or Letter of Credit, any
transaction contemplated by the Transaction Documents but excluding any such
losses, liabilities, claims, damages, expenses, obligations, penalties, actions,
judgments, suits, costs or disbursements that the Borrower proves were the
result solely of the gross negligence or willful misconduct of such Indemnitee,
as finally determined by a court of competent jurisdiction. If and to the extent
that the foregoing obligations of the Borrowers under this paragraph (a), or any
other indemnification obligation of the Borrowers hereunder or under any other
Loan Document are unenforceable for any reason, the Borrowers hereby agree,
jointly and severally, to make the maximum contribution to the payment and
satisfaction of such obligations which is permissible under applicable Law.
(b) Without limiting the generality of the foregoing, the Borrowers
jointly and severally hereby indemnify and agree to defend and hold harmless
each Indemnitee, from and against any and all claims, actions, causes of action,
liabilities, penalties, fines, damages, judgments, losses, suits, expenses,
legal or administrative proceedings, interest, costs and expenses (including
court costs and attorneys', consultants' and experts' fees) arising out of or in
any way relating to: (i) the use, handling, management, production, treatment,
processing, storage, transfer, transportation, disposal, release or threat of
release of any Environmental Concern Material by or on behalf of, any Borrower
or any of its Environmental Affiliates; (ii) the presence of Environmental
Concern Materials on, about, beneath or arising from any premises owned or
occupied by any Borrower or any of its Environmental Affiliates (herein
collectively, the "Premises"); (iii) the failure of any Borrower or
Environmental Affiliate of a Borrower or any occupant of any Premises to comply
with the Environmental Laws; (iv) any Borrower's breach of any of the
representations, warranties and covenants contained herein or in any Loan
Documents; (v) Regulatory Actions (as hereinafter defined) and Third Party
Claims (as hereinafter defined); or (vi) the imposition or recording of a Lien
against any Premises in connection with any release at, on or from any Premises
or any activities undertaken on or occurring at any Premises, or arising from
such Premises or pursuant to any Environmental Law. The
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Borrowers' indemnity and defense obligations under this section shall include,
whether foreseeable or unforeseeable, any and all costs related to any remedial
action. "Regulatory Action" means any notice of violation, citation, complaint,
request for information, order, directive, compliance schedule, notice of claim,
consent decree, action, litigation or proceeding brought or instituted by any
governmental authority under or in connection with any Environmental Law
involving any Borrower or any occupant of any of the Premises or involving any
of the Premises or any activities undertaken on or occurring at any Premises.
"Third Party Claims" means claims by a party (other than a party to this
Agreement and other than Regulatory Actions) based on negligence, trespass,
strict liability, nuisance, toxic tort or detriment to human health or welfare
due to Environmental Concern Materials on, about, beneath or arising from any
Premises or in any way related to any alleged violation of any Environmental
Laws or any activities undertaken on or occurring at any Premises.
(c) The indemnities contained herein shall survive repayment of the
Loan Obligations, termination of the Commitment and satisfaction, release, and
discharge of the Loan Documents, whether through full payment of the Loans,
foreclosure, deed in lieu of foreclosure or otherwise.
(d) The foregoing amounts are in addition to any other amounts which
may be due and payable to the Administrative Agent and/or the Lenders under this
Agreement. A certification by the Administrative Agent or a Lender hereunder of
the amount of liabilities, losses, costs, expenses, claims and/or charges shall
be conclusive, absent manifest error.
12.13 EXPENSES
Whether or not there shall be any funding hereunder, the Borrowers
agree, jointly and severally, to pay promptly or cause to be paid promptly and
to hold harmless
(i) with respect to matters relating to clause (1) of
this paragraph (i), the Agents, and, with respect to clauses (2) and
(3) of this paragraph (i), the Administrative Agent (and after an
Event of Default, and for the period in which the same shall
continue, each Lender Party) against liability for the payment of
all reasonable out-of-pocket costs and expenses (including but not
limited to reasonable fees and expenses of counsel, including local
counsel, auditors, consulting engineers, appraisers, and all other
professional, accounting, evaluation and consulting costs) incurred
by it from time to time arising from or relating to (1) the
negotiation, preparation, execution and delivery of this Agreement
and the other Loan Documents, (2) the administration and performance
of this Agreement and the other Loan Documents, and (3) any
requested amendments, modifications, supplements, waivers or
consents (whether or not ultimately entered into or granted) to this
Agreement or any other Loan Document;
(ii) the Administrative Agent (and, with respect to
clause (4) of this paragraph (ii) after an Event of Default, and for
the period in which the same shall continue, each Lender Party)
against liability for the payment of all reasonable out-of-pocket
costs and expenses (including but not limited to reasonable fees and
expenses of counsel, including local counsel, auditors,
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consulting engineers, appraisers, and all other professional,
accounting, evaluation and consulting costs) incurred by it from
time to time arising from or relating to the enforcement or
preservation of rights under, or administration of, this Agreement
or any other Loan Document (including but not limited to any such
costs or expenses arising from or relating to (1) the creation,
perfection or protection of any Lien on any Collateral, (2) the
protection, collection, lease, sale, taking possession of,
preservation of, or realization on, any Collateral, including
advances for storage, insurance premiums, transportation charges,
taxes, filing fees and the like, (3) collection or enforcement of an
outstanding Loan, Obligation, and (4) any litigation, proceeding,
dispute, work-out, restructuring or rescheduling related in any way
to this Agreement or the other Loan Documents); and
(iii) each Lender Party against liability for all stamp,
document, transfer, recording, filing, registration, search, sales
and excise fees and taxes and all similar impositions now or
hereafter determined by any Lender Party to be payable in connection
with this Agreement or any other Loan Documents.
12.14 MAXIMUM AMOUNT OF JOINT AND SEVERAL LIABILITY. To the extent that
applicable Law otherwise would render the full amount of the joint and several
obligations of any Subsidiary of Multicare hereunder and under the other Loan
Documents invalid or unenforceable, such Borrower's obligations hereunder and
under the other Loan Documents shall be limited to the maximum amount which does
not result in such invalidity or unenforceability, provided, however, that each
Borrower's obligations hereunder and under the other Loan Documents shall be
presumptively valid and enforceable to their fullest extent in accordance with
the terms hereof or thereof, as if this Section 12.14 were not a part of this
Agreement.
12.15 AUTHORIZATION OF MULTICARE BY OTHER BORROWERS.
(a) Each of the Borrowers hereby irrevocably authorizes Multicare to
give notices, make requests, make payments, receive payments and notices, give
receipts and execute agreements, make agreements or take any other action
whatever on behalf of such Borrower under and with respect to any Loan Document
and each Borrower shall be bound thereby. This authorization is coupled with an
interest and shall be irrevocable, and the Administrative Agent and each Lender
Party may rely on any notice, request, information supplied by Multicare and
every document executed by Multicare, agreement made by Multicare or other
action taken by Multicare in respect of the Borrowers or any thereof as if the
same were supplied, made or taken by any or all Borrowers. Without limiting the
generality of the foregoing, the failure of one or more Borrowers to join in the
execution of any writing in connection herewith shall not, unless the context
clearly requires, relieve any such Borrower from obligations in respect of such
writing.
(b) The Borrowers acknowledge that the credit provided hereunder is
on terms more favorable than any Borrower acting alone would receive and that
each Borrower benefits indirectly from all Loans and Letters of Credit
hereunder. Multicare and, subject only to the terms of the preceding paragraph
(a), each of the other Borrowers, shall be
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jointly and severally liable for all Loan Obligations, regardless of, inter
alia, which Borrower requested (or received the proceeds of) a particular Loan
or Letter of Credit.
12.16 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. With respect to its
Commitment hereunder and the Loan Obligations owing to it, the Administrative
Agent shall have the same rights and powers under this Agreement and each other
Loan Document as any other Lender and may exercise the same as though it were
not the Administrative Agent, and the terms "Lender," "Issuer," "Holders of
Notes" and like terms shall include the Administrative Agent in its individual
capacity as such. The Administrative Agent and its Affiliates may, without
liability to account, make loans to, accept deposits from, acquire debt or
equity interests in, act as trustee under indentures of, enter into Interest
Rate Hedging Agreements with, serve as "Administrative Agent" for other
financing vehicles, issue letters of credit on behalf of, and engage in any
other business with, (a) any Loan Party or any stockholder, Subsidiary or
Affiliate of any Loan Party or (b) any other Person, whether such other Person
may be engaged in any conflict or dispute with any Loan Party or any Lender
Party or otherwise, as though the Administrative Agent were not the
Administrative Agent hereunder.
12.17 CERTAIN WAIVERS BY BORROWERS. Each Borrower hereby waives
promptness, diligence, notice of acceptance and any other notice with respect to
any of the Loan Obligations and any requirement that any Lender Party protect,
secure, perfect or insure any Lien or any property subject thereto or exhaust
any right or take any action against any other Borrower or any other Person or
any collateral or other direct or indirect security for any of the Loan
Obligations. Without limiting the generality of the foregoing, each Borrower
acknowledges and agrees that the Administrative Agent or other Lender Party may
commence an action against such Borrower whether or not any action is brought
against any other Borrower or against any collateral and it shall be no defense
to any action brought against any Borrower that the Lender Parties have failed
to bring an action against any other Loan Party or any Collateral.
12.18 SET-OFF. The Borrowers hereby agree that, to the fullest extent
permitted by Law, if any Loan Obligation shall be due and payable (by
acceleration or otherwise), each Lender Party shall have the right, without
notice to any Borrower, to set-off against and to appropriate and apply to such
Loan Obligation any indebtedness, liability or obligation of any nature owing to
any Borrower by such Lender Party, including but not limited to all deposits now
or hereafter maintained by any Borrower with such Lender Party. Such right shall
exist whether or not such Lender Party or any other Person shall have given
notice or made any demand to any Borrower or any other Person. The Borrowers
hereby agree that, to the fullest extent permitted by Law, any participant and
any Affiliate of any Lender Party or any participant shall have the same rights
of set-off as a Lender Party as provided in this Section 12.18. The rights
provided by this Section 12.18 are in addition to all other rights of set-off
and banker's lien and all other rights and remedies which any Lender Party (or
any such participant, or Affiliate) may otherwise have under this Agreement, any
other Loan Document, at law or in equity, or otherwise.
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12.19 SHARING OF COLLECTIONS. The Lender Parties hereby agree among
themselves that if any Lender Party shall receive (by voluntary payment,
realization upon security, charging of accounts, set-off or from any other
source) any amount on account of the Loan Obligations in greater proportion than
any such amount received by any other Lender Party (based on the relative amount
of each such Lender Party's interest in the Loan Obligations), then the Lender
Party receiving such proportionately greater payment shall notify each other
Lender Party and the Administrative Agent of such receipt, and equitable
adjustment will be made in the manner stated in this Section 12.19 so that, in
effect, all such excess amounts will be shared ratably among all of the Lender
Parties. The Lender Party receiving such excess amount shall purchase (which it
shall be deemed to have done simultaneously upon the receipt of such excess
amount) for cash from the other Lender Parties a participation in the applicable
Loan Obligations owed to such other Lender Parties in such amount as shall
result in a ratable sharing by all Lender Parties of such excess amount (and to
such extent the receiving Lender Party shall be a participant). If all or any
portion of such excess amount is thereafter recovered from the Lender Party
making such purchase, such purchase shall be rescinded and the purchase price
restored to the extent of such recovery, together with interest or other
amounts, if any, required by Law to be paid by the Lender Party making such
purchase. The Borrowers hereby consent to and confirm the foregoing
arrangements. Each participant shall be bound by this Section 12.19 as fully as
if it were a Lender hereunder.
12.20 OTHER LOAN DOCUMENTS. Each Lender acknowledges that on signing this
Agreement it is bound by the terms of the Loan Documents. Without limiting the
generality of the foregoing, each Lender party to a Qualifying Interest Rate
Hedging Agreement acknowledges that it is familiar with the provisions set forth
in Section 2 of the Pledge Agreement.
12.21 CERTAIN BORROWER ACKNOWLEDGEMENTS. Each Borrower hereby acknowledges
that neither the Administrative Agent nor any other Lender Party has any
fiduciary relationship with, or any fiduciary duty to any Borrower arising out
of or in connection with this Agreement or any of the other Loan Documents and
the relationship between the Administrative Agent and the other Lender Parties,
on the one hand, and the Borrower, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor.
12.22 CONSENT TO JURISDICTION, SERVICE AND VENUE; WAIVER OF JURY TRIAL.
(a) Consent to Jurisdiction. For the purpose of enforcing payment
and performance of the Loan Documents, including, any payment under the Notes
and performance of other obligations under the Loan Documents, or in any other
matter relating to, or arising out of, the Loan Documents, each of the Borrowers
hereby consents to the jurisdiction and venue of the courts of the Commonwealth
of Pennsylvania or of any federal court located in such state, waive personal
service of any and all process upon it and consents that all such service of
process be made by certified or registered mail directed to Multicare (on behalf
of the applicable Borrowers) at the address provided for in Section 12.1 and
service so made shall be deemed to be completed upon actual receipt or execution
of a receipt by any Person at such address. Each of the Borrowers hereby waives
the right to contest the jurisdiction and venue of the courts located in the
Commonwealth of Pennsylvania
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on the ground of inconvenience or otherwise and, further, waives any right to
bring any action or proceeding against (a) the Administrative Agent in any court
outside the Commonwealth of Pennsylvania, or (b) any other Lender other than in
a state within the United States designated by such Lender. The provisions of
this Section 12.22 shall not limit or otherwise affect the right of the
Administrative Agent or any other Lender Party to institute and conduct an
action in any other appropriate manner, jurisdiction or court.
(b) WAIVER OF JURY TRIAL; DAMAGES. NEITHER ANY LENDER PARTY NOR ANY
LOAN PARTY, NOR ANY ASSIGNEE, SUCCESSOR, HEIR OR PERSONAL REPRESENTATIVE OF THE
FOREGOING SHALL SEEK A JURY TRIAL IN ANY PROCEEDING BASED UPON OR ARISING OUT OF
THIS AGREEMENT, OR ANY OTHER LOAN DOCUMENT, OR INVOLVING ANY COLLATERAL OR ANY
GUARANTY RELATING TO THE INDEBTEDNESS HEREUNDER OR THE RELATIONSHIP BETWEEN OR
AMONG SUCH PERSONS OR ANY OF THEM. NO SUCH PERSON WILL SEEK TO CONSOLIDATE ANY
SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT
BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, EACH PARTY TO THIS AGREEMENT WAIVES
ANY RIGHTS IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION REFERRED TO IN THIS
SECTION 12.22 ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. EACH PARTY TO THIS
AGREEMENT (i) CERTIFIES THAT NEITHER THE ADMINISTRATIVE AGENT NOR ANY LENDER
PARTY NOR ANY REPRESENTATIVE, OR ATTORNEY OF THE ADMINISTRATIVE AGENT OR ANY
LENDER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE ADMINISTRATIVE
AGENT OR SUCH LENDER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVERS AND (ii) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT AND EACH OTHER LOAN DOCUMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS PARAGRAPH (b) OF SECTION 12.22.
THE PROVISIONS OF THIS SECTION 12.22 HAVE BEEN FULLY DISCLOSED TO THE PARTIES
AND THE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS. NO PARTY HAS IN ANY WAY
AGREED WITH OR REPRESENTED TO ANY OTHER PARTY THAT THE PROVISIONS OF THIS
SECTION 12.22 WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.
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IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed and delivered this Agreement as of the date first
above written.
BORROWERS:
THE MULTICARE COMPANIES, INC., a
Delaware corporation
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President, Controller
and Assistant Secretary
Address for notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
ADS APPLE VALLEY LIMITED PARTNERSHIP, a Massachusetts limited partnership, by:
ADS Apple Valley, Inc. its General Partner
ADS DARTMOUTH GENERAL PARTNERSHIP, a Massachusetts general partnership, by ADS
Dartmouth ALF, Inc. and ADS Senior Housing, Inc., its General Partners
ADS HINGHAM LIMITED PARTNERSHIP, a Massachusetts limited partnership, by ADS
Hingham Nursing Facility, Inc., its General Partner
ADS RECUPERATIVE CENTER LIMITED PARTNERSHIP, a Massachusetts limited
partnership, by ADS Recuperative Center, Inc., its General Partner
CARE 4, L.P., a Delaware limited partnership, by Institutional Health Care
Services, Inc., its General Partner
CARE HAVEN ASSOCIATES LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
/s/ JVM
---------------------
Initials of ▇▇▇▇▇▇
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CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Cumberland, Inc., its General Partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
GROTON ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Groton, Inc., its General Partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited
partnership, by Health Resources of Middletown (R.I.), Inc., its General Partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc., its General Partner
RALEIGH MANOR LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
ROMNEY HEALTH CARE CENTER LIMITED PARTNERSHIP, a West Virginia limited
partnership, by Glenmark Associates, Inc., its General Partner
SISTERVILLE HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
THE ▇▇▇▇▇▇ GROUP - ▇▇▇▇▇▇▇ HOUSE, L.P., a New Jersey limited partnership, by
Encare of Wyncote, Inc., its General Partner
THE ▇▇▇▇▇▇ GROUP - QUAKERTOWN MANOR, L.P., a New Jersey limited partnership, by
Encare of Quakertown, Inc., its General Partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Wallingford, Inc., its General Partner
WARWICK ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Warwick, Inc., its General Partner
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
__________________________
On behalf of each of the foregoing
as Vice President, Controller
and Assistant Secretary of the General
Partner
Address for notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-127-
▇▇▇▇▇ ▇▇▇▇▇ ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Encare of Mendham, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Breyut Convalescent Center, L.L.C., its General Partner, by Century Care
Management, Inc., its authorized manager
POMPTON ASSOCIATES, L.P., a New Jersey limited partnership, by Pompton Corp.,
L.L.C., its General Partner, by Century Care Management, Inc., its authorized
manager
THE ▇▇▇▇▇▇ GROUP - OLD BRIDGE, L.P., a New Jersey limited partnership, by Health
Resources of ▇▇▇▇▇, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
THE ▇▇▇▇▇▇ GROUP - RIDGEWOOD, L.P., a New Jersey limited partnership, by Health
Resources of Ridgewood, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
__________________________
On behalf of each of the foregoing
as Vice President, Controller
and Assistant Secretary of the manager
Address for notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-128-
ACADEMY NURSING HOME, INC., a Massachusetts corporation
ADS APPLE VALLEY, INC., a Massachusetts corporation
ADS CONSULTING, INC., a Massachusetts corporation
ADS DANVERS ALF, INC., a Delaware corporation
ADS DARTMOUTH ALF, INC., a Delaware corporation
ADS HINGHAM ALF, INC., a Delaware Corporation
ADS HINGHAM NURSING FACILITY, INC., a Massachusetts corporation
ADS HOME HEALTH, INC., a Delaware corporation
ADS MANAGEMENT, INC., a Massachusetts corporation
ADS/MULTICARE, INC., a Delaware corporation
ADS RECUPERATIVE CENTER, INC., a Massachusetts corporation
ADS SENIOR HOUSING, INC., a Massachusetts corporation
ADS VILLAGE MANOR, INC., a Massachusetts corporation
ANR, INC., a Delaware corporation
APPLEWOOD HEALTH RESOURCES, INC., a Delaware corporation
AUTOMATED PROFESSIONAL ACCOUNTS, INC., a West Virginia corporation
BERKS NURSING HOMES, INC., a Pennsylvania corporation
BETHEL HEALTH RESOURCES, INC., a Delaware corporation
BRIGHTWOOD PROPERTY, INC., a West Virginia corporation
CENTURY CARE CONSTRUCTION, INC., a New Jersey corporation
CENTURY CARE MANAGEMENT, INC., a Delaware corporation
CHATEAU VILLAGE HEALTH RESOURCES, INC., a Delaware corporation
CHG INVESTMENT CORP., INC., a Delaware corporation
CHNR-1, INC., a Delaware corporation
COLONIAL HALL HEALTH RESOURCES, INC., a Delaware corporation
COLONIAL HOUSE HEALTH RESOURCES, INC., a Delaware corporation
COMPASS HEALTH SERVICES, INC., a West Virginia corporation
CONCORD HEALTH GROUP, INC., a Delaware corporation
/s/ JVM
--------------------
Initials of ▇▇▇▇▇▇
-129-
CONCORD HOME HEALTH, INC., a Pennsylvania corporation
CONCORD PHARMACY SERVICES, INC., a Pennsylvania corporation
CONCORD REHAB, INC., a Pennsylvania corporation
CONCORD SERVICE CORPORATION, a Pennsylvania corporation
CVNR, INC., a Delaware corporation
DELM NURSING, INC., a Pennsylvania corporation
ELMWOOD HEALTH RESOURCES, INC., a Delaware corporation
ENCARE OF MASSACHUSETTS, INC., a Delaware corporation
ENCARE OF PENNYPACK, INC., a Pennsylvania corporation
ENCARE OF QUAKERTOWN, INC., a Pennsylvania corporation
ENCARE OF WYNCOTE, INC., a Pennsylvania corporation
ENR, INC., a Delaware corporation
GLENMARK ASSOCIATES, INC., a West Virginia corporation
GMA - BRIGHTWOOD, INC., a West Virginia corporation
GMA CONSTRUCTION, INC., a West Virginia corporation
GMA - MADISON, INC., a West Virginia corporation
GMA PARTNERSHIP HOLDING COMPANY, INC., a West Virginia corporation
GMA - UNIONTOWN, INC., a Pennsylvania corporation
HEALTH RESOURCES OF BROADMAN, INC., a Delaware corporation
HEALTH RESOURCES OF CEDAR GROVE, INC., a New Jersey corporation
HEALTH RESOURCES OF COLCHESTER, INC., a Connecticut corporation
HEALTH RESOURCES OF COLUMBUS, INC., a Delaware corporation
HEALTH RESOURCES OF CUMBERLAND, INC., a Delaware corporation
HEALTH RESOURCES OF EATONTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF FARMINGTON, INC., a Delaware corporation
HEALTH RESOURCES OF ▇▇▇▇▇▇▇, INC., a Delaware corporation
/s/ JVM
--------------------
Initials of ▇▇▇▇▇▇
-130-
HEALTH RESOURCES OF GLASTONBURY, INC., a Connecticut corporation
HEALTH RESOURCES OF GROTON, INC., a Delaware corporation
HEALTH RESOURCES OF LAKEVIEW, INC., a New Jersey corporation
HEALTH RESOURCES OF LEMONT, INC., a Delaware corporation
HEALTH RESOURCES OF ▇▇▇▇, INC., a New Jersey corporation
HEALTH RESOURCES OF KARMENTA AND MADISON, INC., a Delaware corporation
HEALTH RESOURCES OF ▇▇▇▇▇▇▇▇, INC., a Delaware corporation
HEALTH RESOURCES OF MIDDLETOWN (R.I.), INC., a Delaware corporation
HEALTH RESOURCES OF MORRISTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF NORFOLK, INC., a Delaware corporation
HEALTH RESOURCES OF NORWALK, INC., a Connecticut corporation
HEALTH RESOURCES OF PENNINGTON, INC., a New Jersey corporation
HEALTH RESOURCES OF ROCKVILLE, INC., a Delaware corporation
HEALTH RESOURCES OF SOUTH BRUNSWICK, INC., a New Jersey corporation
HEALTH RESOURCES OF ▇▇▇▇ HILLS, INC., a New Jersey corporation
HEALTH RESOURCES OF WALLINGFORD, INC., a Delaware corporation
HEALTH RESOURCES OF WARWICK, INC., a Delaware corporation
HEALTHCARE REHAB SYSTEMS, INC., a Pennsylvania corporation
HORIZON ASSOCIATES, INC., a West Virginia corporation
HORIZON MEDICAL EQUIPMENT AND SUPPLY, INC., a West Virginia corporation
HORIZON MOBILE, INC., a West Virginia corporation
HORIZON REHABILITATION, INC., a West Virginia corporation
HR OF CHARLESTON, INC., a West Virginia corporation
HRWV Huntington, Inc., a West Virginia corporation
/s/ JVM
--------------------
Initials of ▇▇▇▇▇▇
-131-
INSTITUTIONAL HEALTH CARE SERVICES, INC., a New Jersey corporation
LAKEWOOD HEALTH RESOURCES, INC., a Delaware corporation
LAUREL HEALTH RESOURCES, INC., a Delaware corporation
LEHIGH NURSING HOMES, INC., a Pennsylvania corporation
LWNR, INC., a Delaware corporation
MABRI CONVALESCENT CENTER, INC., a Connecticut corporation
MARKGLEN, INC., a West Virginia corporation
MARSHFIELD HEALTH RESOURCES, INC., a Delaware corporation
▇▇▇▇▇▇▇▇▇▇ NURSING HOMES, INC., a Pennsylvania corporation
MULTICARE AMC, INC., a Delaware Corporation
MULTICARE HOME HEALTH OF ILLINOIS, INC., a Delaware corporation
NATIONAL PHARMACY SERVICE, INC., a Pennsylvania corporation
NURSING AND RETIREMENT CENTER OF THE ANDOVERS, INC., a Massachusetts corporation
PHC OPERATING CORP., a Delaware corporation
POCAHONTAS CONTINUOUS CARE CENTER, INC., a West Virginia corporation
PRESCOTT NURSING HOME, INC., a Massachusetts corporation
PROGRESSIVE REHABILITATION CENTERS, INC., a Delaware corporation
PROVIDENCE HEALTH CARE, INC., a Delaware corporation
REST HAVEN NURSING HOME, INC, a West Virginia corporation
RIDGELAND HEALTH RESOURCES, INC., a Delaware corporation
RIVER PINES HEALTH RESOURCES, INC., a Delaware corporation
RIVERSHORES HEALTH RESOURCES, INC., a Delaware corporation
RLNR, INC., a Delaware corporation
ROSE HEALTHCARE, INC., a New Jersey corporation
ROSE VIEW MANOR, INC., a Pennsylvania corporation
RSNR, INC., a Delaware corporation
RVNR, INC., a Delaware corporation
SENIOR LIVING VENTURES, INC., a Pennsylvania corporation
/s/ JVM
------------------
Initials of ▇▇▇▇▇▇
-132-
SCHUYLKILL NURSING HOMES, INC., a Pennsylvania corporation
SCHUYLKILL PARTNERSHIP ACQUISITION CORP., a Pennsylvania corporation
SENIOR SOURCE, INC., a Massachusetts corporation
SNOW VALLEY HEALTH RESOURCES, INC., a Delaware corporation
SOLOMONT FAMILY FALL RIVER VENTURE, INC., a Massachusetts corporation
SOLOMONT FAMILY MEDFORD VENTURE, INC., a Massachusetts corporation
▇▇▇▇▇▇▇▇ CONVALESCENT CENTER, INC., a Delaware corporation
S.T.B. INVESTORS, LTD., a New York corporation
SVNR, INC., a Delaware corporation
THE ADS GROUP, INC., a Massachusetts corporation
TRI-STATE MOBILE MEDICAL SERVICES, INC., a West Virginia corporation
WESTFORD NURSING AND RETIREMENT CENTER, INC., a Massachusetts corporation
WILLOW MANOR NURSING HOME, INC., a Massachusetts corporation
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_______________________
On behalf of each of the foregoing as Vice
President, Controller and Assistant
Secretary
Address for notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-133-
BREYUT CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
ENCARE OF MENDHAM, L.L.C., a New Jersey limited liability company, by Century
Care Management, Inc., its authorized manager
HEALTH RESOURCES OF BRIDGETON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CINNAMINSON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CRANBURY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF ▇▇▇▇▇, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF ENGLEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EWING, L.L.C., a New Jersey limited liability company. by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF FAIR LAWN, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF ▇▇▇▇▇▇▇, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF RIDGEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF WEST ORANGE, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
POMPTON CARE, L.L.C., a New Jersey limited liability company, by Century Care
Management, Inc., its authorized manager
ROEPHEL CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
/s/ JVM
------------------
Initials of ▇▇▇▇▇▇
-134-
TOTAL REHABILITATION CENTER, L.L.C., a New
Jersey limited liability corporation, by
Century Care Management, Inc., its authorized
manager
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_______________________
On behalf of each of the foregoing
Vice President, Controller
and Assistant Secretary of the manager
Address for notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-135-
The Surety hereby joins this Credit Agreement for the purposes of (1)
acknowledging the terms and conditions and receipt of a true, correct and
complete copy hereof, (2) representing and warranting to the Lender Parties that
the representations and warranties contained herein are true and correct, and
(3) agreeing with the Lender Parties to comply with the affirmative, financial
and negative covenants contained herein to the extent they apply, by their
terms, to the Surety.
GENESIS ELDERCARE CORP.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
_______________________
Title:
-136-
[PAGES 137-177 INTENTIONALLY OMITTED]
-137-
AGENTS, ISSUER AND LENDERS:
MELLON BANK, N.A., as a Lender,
as Issuer and as Administrative Agent
By /s/ ▇▇▇▇▇▇▇ ▇. Bauswald
________________________________
Name: ▇▇▇▇▇▇▇ ▇. Bauswald
Title: Vice President
Address for notices:
street address:
AIM 199-5220
Mellon Independence Center
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
mailing address:
AIM 199-5220
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇,
Loan Administration
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-178-
With a copy to
Plymouth Meeting Executive Campus
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
Plymouth Meeting, Pennsylvania 19462
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Vice President
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
With a copy for notices respecting
assignments to:
MELLON BANK, N.A.
One Mellon ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-179-
CITICORP USA INC., as a Lender and as
Syndication Agent
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_______________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Managing Director
Address for notices:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-180-
FIRST UNION NATIONAL BANK, as a Lender and
as Documentation Agent
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Senior Vice President
Address for notices:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-181-
NATIONSBANK, N.A., as a Lender and as a
Syndication Agent
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
_______________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Vice President
Address for notices:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
NC1-001-15-11
Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
With a copy to
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
NC1-007-0813
Attention: ▇▇▇▇▇ ▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
-182-
CORESTATES BANK, N.A.
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
CoreStates Bank, N.A.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
F.C. 1-8-3-22
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-183-
CREDIT LYONNAIS NEW YORK BRANCH
By /s/ Farboud Tavangar
________________________________
Name: Farboud Tavangar
Title: First Vice President
Address for notices:
Credit Lyonnais New York Branch
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-184-
FLEET NATIONAL BANK
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
Title: Senior Vice President
Address for notices:
Fleet National Bank
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-185-
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By /s/ Takuya Honjo
________________________________
Name: Takuya Honjo
Title: Senior Vice President
Address for notices:
The Industrial Bank of Japan, Limited
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ Takehisa
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-186-
NATIONAL WESTMINSTER BANK Plc
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
National Westminster Bank Plc
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Gleacher NatWest Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Field ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-187-
THE SAKURA BANK, LIMITED
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
Address for notices:
The Sakura Bank, Limited
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-188-
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇
Title: Vice President
Address for notices:
Bank of America National Trust
& Savings Associations
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
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Attention: ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-189-
BANQUE PARIBAS
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Director
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Director
Address for notices:
Banque Paribas
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Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-190-
BANK OF MONTREAL
By /s/ ▇▇▇▇▇ Konigsmann
________________________________
Name: ▇▇▇▇▇ Konigsmann
Title: Director
Address for notices:
Bank of Montreal
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Attention: ▇▇▇▇▇ Konigsmann
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-191-
BANKBOSTON, N.A.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
Address for notices:
BankBoston, N.A.
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Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-192-
THE BANK OF NEW YORK
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Address for notices:
The Bank of New York
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-193-
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By /s/ ▇. ▇▇▇▇▇▇▇▇
________________________________
Name: ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
Bank of Tokyo-Mitsubishi Trust Company
1251 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
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Attention: ▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-194-
CRESTAR BANK
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Address for Notices:
Crestar Bank
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Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-195-
DRESDNER BANK AG, NEW YORK
BRANCH AND GRAND CAYMAN BRANCH
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
_______________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Treasurer
Address for notices:
Dresdner Bank AG, New York
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Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-196-
FINOVA CAPITAL CORPORATION
By /s/ ▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title:
Address for notices:
Finova Capital Corporation
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Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-197-
THE FUJI BANK, LIMITED, NEW YORK BRANCH
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President and Manager
Address for notices:
The Fuji Bank, Limited,
New York Branch
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Attention: ▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-198-
KEY CORPORATE CAPITAL INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: Vice President
Address for notices:
Key Corporate Capital Inc.
c/o Key Bank, N.A.
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Attention: ▇▇▇▇▇▇ ▇▇▇▇
OH-01-27-0605
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-199-
KREDIETBANK N.V.
By ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
Kredietbank N.V.
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Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-200-
FIRST NATIONAL BANK OF MARYLAND
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Address for notices:
First National Bank of Maryland
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-201-
NATEXIS BANQUE BFCE
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: VP - Group Manager
Address for notices:
Natexis Banque BFCE
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Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-202-
ROYAL BANK OF CANADA
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Senior Manager
Address for notices:
Royal Bank of Canada
Financial Square, ▇▇▇▇ ▇▇▇▇▇
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Attention: ▇▇▇ ▇▇▇▇▇▇, Manager
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-203-
NATIONAL CITY BANK OF PENNSYLVANIA
By /s/ ▇. ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇. ▇. ▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
National City Bank of Pennsylvania
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Loc. ▇▇-▇▇-▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-204-
THE MITSUBISHI TRUST AND BANKING CORPORATION
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
Address for notices:
The Mitsubishi Trust and Banking
Corporation
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Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ or
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-205-
THE SANWA BANK, LIMITED
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
The Sanwa Bank, Limited
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Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-206-
THE SUMITOMO BANK, LIMITED
By /s/ J. ▇▇▇▇ ▇▇▇▇
________________________________
Name: J. ▇▇▇▇ ▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇
Title: Vice President and Manager
Address for notices:
The Sumitomo Bank, Limited
One Liberty Place
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Attention: J. ▇▇▇▇ ▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-207-
TORONTO DOMINION (NEW YORK), INC.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Mgr. Cr. Admin.
Address for notices:
The Toronto-Dominion Bank
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Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-208-
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By /s/ Noboru Kubora
________________________________
Name: Noboru Kubora
Title: Deputy General Manager
Address for notices:
The Long-Term Credit Bank of Japan, Ltd.
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Attention: Junicchi Ebihara
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-209-
SUMMIT BANK
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President and Regional Manager
Address for notices:
Summit Bank
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Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-210-
THE DAI-ICHI KANGYO BANK, LTD.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Vice President and Group Leader
Address for notices:
The Dai-Ichi Kangyo Bank, Ltd.
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Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-211-
CREDITANSTALT CORPORATE FINANCE, INC.
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
_______________________________
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Associate
Address for notices:
Creditanstalt Corporate Finance, Inc.
Two ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-212-
CREDIT SUISSE FIRST BOSTON
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
By /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Associate
Address for notices:
Credit Suisse First Boston
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-213-
FIRST NATIONAL BANK OF CHICAGO
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
Address for notices:
First National Bank of Chicago
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▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-214-
SCOTIABANC, INC.
By /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: Relationship Manager
Address for notices:
ScotiaBanc, Inc.
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Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-215-
COMMERZBANK AG, NEW YORK BRANCH
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
By /s/ G. Rod McWa
--------------------------------
Name: G. Rod McWa
Title: Vice President
Address for notices:
Commerzbank AG, New York Branch
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-216-
CIBC INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
_________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Manager Director, CIBC Wood Gundy
Securities Corp., as Agent
Address for notices:
CIBC Inc.
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Attention: ▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-217-
AMSOUTH BANK
By /s/ ▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Commercial Banking Officer
Address for notices:
AmSouth Bank
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Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-218-
PFL LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. Theodaid
________________________________
Name: ▇▇▇▇▇▇▇ ▇. Theodaid
Title: VP and Asst. Secretary
Address for notices:
PFL Life Insurance Company
c/o Aegon USA Investment Management, Inc.
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Attention: ▇▇▇▇ ▇▇▇▇▇▇, Securities Analyst
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-219-
PEOPLES INTERNAL BOND FUND
By /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: Second Vice President--Investments
Address for notices:
Peoples Internal Bond Fund
c/o Aegon USA Investment Management, Inc.
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Attention: ▇▇▇▇ ▇▇▇▇▇▇, Securities Analyst
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-220-
ALLSTATE INSURANCE COMPANY
By________________________________
Name:
By________________________________
Name:
Its Authorized Signatories
Address for notices:
Allstate Insurance Company
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Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-221-
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-222-
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-223-
FLOATING RATE PORTFOLIO
By: Chancellor LGT Senior Secured
Management, Inc., as attorney in fact
By /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
________________________________
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President
Address for notices:
Floating Rate Portfolio
c/o Chancellor LGT Senior Secured
Management, Inc.
1166 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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-225-
PRIME INCOME TRUST
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Senior Vice President
Address for notices:
Prime Income Trust
c/o ▇▇▇▇ ▇▇▇▇▇▇ Intercapital, Inc.
72nd ▇▇▇▇▇
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. Pistecchia
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-226-
[THIS PAGE INTENTIONALLY OMITTED]
-227-
DEEPROCK & COMPANY
By: ▇▇▇▇▇ ▇▇▇▇▇ Management
as Investment Advisor
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President and Portfolio
Manager
Address for notices:
Deeprock & Company
c/o State Street Bank & Trust Company
Corporate Trust Division
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▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-228-
ING HIGH INCOME PRINCIPAL PRESERVATION
OFFERING, L.P.
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President & Portfolio Manager
Address for notices:
Ing High Income Principal Preservation
Offering, L.P.
c/o Ing Capital Advisors, Inc.
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Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-229-
KZH-ING-1 CORPORATION
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Agent
Address for notices:
KZH-ING-1 Corporation
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-230-
MASSACHUSETTS MUTUAL LIFE INSURANCE CO.
By /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Director
Address for notices:
Massachusetts Mutual Life Insurance Co.
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Attention: ▇▇▇▇ ▇▇▇▇▇▇▇, Managing Director
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-231-
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING
RATE FUND, INC.
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Asset Management,
L.P., as Investment Advisor
By /s/ R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
________________________________
Name: R. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Authorized Signatory
Address for notices:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Senior Floating Rate Fund, Inc.
c/o Merrill ▇▇▇▇▇ Asset Management
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Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-232-
METROPOLITAN LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Vice President
Address for notices:
Metropolitan Life Insurance Company
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Asst. Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-233-
THE NORTHWESTERN MUTUAL LIFE INSURANCE
COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Address for notices:
The Northwestern Mutual Life Insurance
Company
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▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Associate Director
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-234-
NEW YORK LIFE INSURANCE AND ANNUITY
CORPORATION
By: New York Life Insurance Company
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Investment Manager
Address for notices:
New York Life Insurance and Annuity
Corporation
c/o New York Life Insurance Company
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-▇▇▇-
▇▇▇ ▇▇▇▇ SECURITIES FUND, L.P.
By: Oak Hill Securities GenPar, L.P.,
Its General Partner
By: Oak Hill Securities MGP, Inc.,
Its General Partner
By /s/ ▇▇▇▇▇ ▇. August
________________________________
Name: ▇▇▇▇▇ ▇. August
Title: President
Address for notices:
Oak Hill Securities Fund, L.P.
c/o Oak Hill Partners, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-236-
OCTAGON CREDIT INVESTORS LOAN PORTFOLIO (A
Unit of The Chase Manhattan Bank)
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
Address for notices:
Octagon Credit Investors Loan Portfolio
(A Unit of The Chase Manhattan Bank)
c/o Octagon Credit Investors
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▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Managing Director
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-237-
PARIBAS CAPITAL FUNDING LLC
By /s/ ▇▇▇▇ ▇▇▇▇▇
________________________________
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Director
Address for notices:
Paribas Capital Funding LLC
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇ Trust Dept.
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇
Phone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇(67)(68)
-238-
PILGRIM AMERICA PRIME RATE TRUST
By /s/ ▇▇▇▇▇▇▇ ▇. Bachevich
________________________________
Name: ▇▇▇▇▇▇▇ ▇. Bachevich
Title: Vice President
[/R]
Address for notices:
Pilgrim America Prime Rate Trust
c/o Pilgrim America Investments, Inc.
Two Renaissance Square
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
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Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-239-
ROYALTON COMPANY
By: Pacific Investment Management
Company, as its Investment Advisor
By /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
Address for notices:
Royalton Company
c/o Pacific Investment Management Co.
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▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇ (▇▇▇▇▇▇▇)
(▇▇▇) ▇▇▇-▇▇▇▇ (▇▇▇▇▇▇▇)
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-240-
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-241-
NORTHERN LIFE INSURANCE COMPANY
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Treasurer
Address for notices:
Northern Life Insurance Company
c/o Reliastar Investment Research, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇, Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-242-
KZH - SOLEIL CORPORATION
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Agent
Address for notices:
KZH - Soleil Corporation
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-243-
KZH HOLDING CORPORATION III
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Agent
Address for notices:
KZH Holding Corporation III
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-244-
KZH-CRESCENT CORPORATION
By /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Authorized Agent
Address for notices:
KZH-Crescent Corporation
▇/▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-245-
▇▇▇ ▇▇▇▇▇▇ AMERICAN CAPITAL PRIME RATE
INCOME TRUST
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Senior Vice President & Director
Address for notices:
▇▇▇ ▇▇▇▇▇▇ American Capital
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇ or 6741
-246-
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-247-
CONTINENTAL ASSURANCE COMPANY
Separate Account (E)
By: TCW Asset Management Company as
attorney-in-fact
By /s/ ▇▇▇▇ ▇. Gold
________________________________
Name: ▇▇▇▇ ▇. Gold
Title: Managing Director
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
Address for notices:
Continental Assurance Company
c/o TCW Asset Management Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. Gold/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
-248-
CIBC INC.
By /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
________________________________
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: CIBC Wood Gundy Securities Corp.,
as Agent
Address for notices:
CIBC Inc.
c/o Canadian Imperial Bank of Commerce
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.
By________________________________
Name:
Title:
Address for notices:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING,
INC.
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CRESCENT/MACH I PARTNERS, L.P.
by: TCW Asset Management Company,
its Investment Manager
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________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President
Address for notices:
Crescent/Mach I Partners L.P.
c/o State Street Bank & Trust Co.
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Please Copy Rate Set Notices To:
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Trust Company of the West
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NEW YORK LIFE INSURANCE COMPANY
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________________________________
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Investment Manager
Address for notices:
New York Life Insurance and
Annuity Corporation
c/o New York Life Insurance Company
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LIST OF SCHEDULES
1.1 Lenders' Commitments
4.1(l) Certificate re: Senior Subordinated Notes and Convertible Debentures
5.1(a) Corporate/Partnership Status of Borrowers
5.1(b) Capitalization of Borrowers
5.1(e) Required Consents
5.1(o) Management Agreements
5.1(p) Health Care Businesses
5.1(q) Leased Properties
5.1(s) Defined Contribution Plans, other Plans and Multiemployer Plans
6.10 Adding Borrowers
8.1 Existing Indebtedness
8.1(f) Assisted Living Facilities
8.2 Permitted Liens
8.3 Investments
8.4 Acquisition Conditions
8.5(d) Ohio, Illinois and Wisconsin Operations
8.5(h) Disposition Conditions
11.1 Capital Stock or other Ownership Interests in Excluded Subsidiaries
LIST OF EXHIBITS
A-1 Form of RC Note
A-2 Form of Tranche A Note
A-3 Form of Swing Loan Note
B Form of Advance Request
C Form of Prepayment Notice
D Form of LIBO Loan Notice
E Form of Pledge Agreement
F Form of Suretyship Agreement
G Form of Officer's Compliance Certificate
H Form of Assignment and Acceptance
I Form of Joinder Supplement
J Form of Multicare Management Subordination Agreement
SCHEDULE 6.10
JOINDER OF BORROWERS
1. Joinder Supplement. Multicare (on behalf of itself and the other
Borrowers) and each Joining Subsidiary shall execute and deliver to the
Administrative Agent, with an executed counterpart for each Lender Party, an
agreement in substantially the form attached to this Agreement as Exhibit I (a
"Joinder Supplement") as to becoming a party hereto and to the relevant Loan
Documents.
2. Notes. Each Joining Subsidiary and each existing Borrower shall
execute and deliver to the Administrative Agent a replacement Note or Allonge
for each Tranche A Lender and each RC Lender, as necessary.
3. Collateral. Each applicable Borrower and each applicable Joining
Subsidiary shall deliver to the Administrative Agent (1) certificates and
instruments representing the stock certificates and other instruments to be
pledged pursuant to the Pledge Agreement accompanied by duly executed
instruments of transfer or assignments in blank to the extent required by the
Pledge Agreement and (2) evidence of the completion of all recordings and
filings (including Uniform Commercial Code financing statements) as may be
necessary or, in the opinion of the Administrative Agent, desirable to create or
perfect the Liens granted and created or purported to be granted and created by
each Joining Subsidiary (or by each existing Borrower in the collateral
comprised of equity of any Joining Subsidiaries) under and pursuant to the
Pledge Agreement.
4. Lien Searches. For each Joining Subsidiary which is acquired by a
Borrower pursuant to an Acquisition, each Joining Subsidiary shall deliver to
the Administrative Agent such evidence of recent searches of Uniform Commercial
Code, tax, judgment records and other appropriate registers as the
Administrative Agent shall request.
5. Corporate or Partnership Proceedings. Each Joining Subsidiary
shall deliver to the Administrative Agent, with an executed counterpart for each
Lender Party, certificates by the Secretary or Assistant Secretary of each
Joining Subsidiary (or general partner thereof), dated as of the Joinder
Effective Date (as defined below) as to the incumbency and signatures of the
respective officers of such Joining Subsidiary who are authorized to sign Loan
Documents, together with (i) true copies of the articles of incorporation and
bylaws or partnership agreement (or other constituent documents) of such Joining
Subsidiary in effect on such date, (ii) true copies of all corporate or
partnership action taken by such Joining Subsidiary relative to this Agreement,
the Joinder Supplement and the other Loan Documents. Each Joining Subsidiary
shall also deliver certificates from
the appropriate Secretaries of State or other applicable Governmental
Authorities dated not more than 30 days before the relevant Joinder Effective
Date showing the good standing of such Joining Subsidiary in its state of
incorporation or organization and each state in which such Joining Subsidiary
does business.
6. Legal Opinions of Counsel. The Borrowers and each Joining
Subsidiary collectively shall cause to be delivered to the Administrative Agent,
with an executed counterpart for each Lender Party, an opinion or opinions
addressed to each Lender Party, dated the relevant Joinder Effective Date, of
counsel to such Joining Subsidiary, Genesis and each of the other Borrowers as
to such matters as may be requested by the Administrative Agent, all in form and
substance satisfactory to the Administrative Agent.
7. Fees, Expenses, Etc. The Borrowers and each Joining Subsidiary
shall pay or cause to be paid all fees and other compensation required to be
paid to the Lender Parties pursuant hereto or pursuant to any other written
agreement on or prior to the Joinder Effective Date.
8. Additional Matters. The Borrowers and each Joining Subsidiary
shall deliver, or cause to be delivered, to the Administrative Agent such other
revised schedules, certificates, opinions, instruments and other documents
(including those relating to licensing) as may be requested by the
Administrative Agent. All such schedules, certificates, opinions, instruments
and other documents shall be satisfactory in form and substance to the
Administrative Agent.
SCHEDULE 8.4
ACQUISITION CONDITIONS
1. Notice. Not later than 15 Business Days before the consummation
of a proposed Acquisition, Multicare (on behalf of the Borrowers) shall have
delivered to each Lender Party a notice of the proposed Acquisition, together
with the following:
(1) copies of audited financial statements of the entity to be
acquired (the "Target") for its last three fiscal years (to the extent
that such audited statements are available, or, to the extent such audited
statements are not so available, unaudited statements for as much of such
period as is available);
(2) copies of the interim financial statements of the Target
for the latest fiscal quarter;
(3) a pro forma projected balance sheet of Multicare and its
Restricted Subsidiaries as of the date of, and after giving effect to, the
proposed Acquisition and a pro forma income statement of Multicare and its
Restricted Subsidiaries for the four fiscal quarters ended on, or most
recently prior to, the date of such proposed Acquisition after giving
effect thereto;
(4) an Officer's Compliance Certificate showing pro forma
compliance with the covenants referred to therein after giving effect to
the proposed Acquisition (which certificate may be delivered after the
other items referred to in this paragraph (1) but no later than five (5)
Business Days prior to the date of the proposed Acquisition); and
(5) revisions to the most recent financial projections
delivered to the Lender Parties by Multicare, which revisions shall take
into account the projected financial condition and results of operations
of the Target for the period covered by such projections.
2. Other Information. In addition, Multicare (on behalf of the
Borrowers) shall have delivered to the Administrative Agent (and with respect to
the information referred to in paragraph (2) below, the requesting Lender Party)
the following:
(1) copies of any agreements entered into or proposed to be
entered into by such Borrower in connection with such Acquisition; and
(2) such other information about the Target or such
Acquisition as any Lender Party may reasonably request.
3. Board Approval. The board of directors (or equivalent governing
body) of the Target shall have approved such Acquisition.
4. Line of Business. Not less than 75% of the Target's revenues
during its most recently completed fiscal year shall have been derived from
lines of business which are, at the time of the Acquisition, among the principal
lines of business of any of the Borrowers.
5. No Default. No Event of Default or Default shall have occurred
and be continuing before, or after giving effect to, the consummation of the
Acquisition.
6. Limitations on Mergers and Consolidations. If any merger is
effected in connection with the Acquisition, a Borrower (including an entity
that becomes a Borrower consistent with the provisions of this Agreement) shall
be the surviving entity in the merger. No consolidation shall be permitted in
connection with any Acquisition.
7. Joinder to Loan Documents. The Borrowers shall cause any new
(direct or indirect) Subsidiary of Multicare which is created or acquired as a
direct or indirect result of, or in connection with, such Acquisition, to become
a Borrower hereunder pursuant to and in accordance with the terms of Section
6.10 of this Agreement and shall cause the ownership interests therein to be
pledged under the Pledge Agreement.
8. Arm's Length. The Acquisition shall be made in good faith in an
arm's-length transaction to a Person which is not an Affiliate of any Borrower,
except as otherwise agreed to by the Required Lenders. Without limiting the
generality of the foregoing, the total consideration paid for the Acquisition
shall be no greater than the fair market value of the subject assets (including
intangible assets).
SCHEDULE 8.5(h)
DISPOSITION CONDITIONS
1. Notice. Multicare (on behalf of the Borrowers) shall have given
each Lender Party at least 5 days prior written notice of any transfer (as
defined in Section 8.5 of this Agreement), together with an Officer's Compliance
Certificate showing pro forma compliance with the financial covenants referred
to therein (including the financial tests set forth in paragraph (h) of Section
8.5) after giving effect to such transfer.
2. Arm's Length. The transfer shall be made in good faith in an
arm's-length transaction to a Person which is not an Affiliate of any Borrower,
except as otherwise agreed to by the Required Lenders. Without limiting the
generality of the foregoing, the total consideration for the transfer shall be
at least equal to the fair market value of the subject assets (including
intangible assets).
3. Transfer of Equity of a Borrower. In the event that any shares of
capital stock, partnership interests or other ownership interests of a Borrower
are to be disposed of or otherwise transferred in such transaction each of the
following additional conditions shall be met:
(a) All Loans made to such Borrower and all intercompany
obligations of such Borrower shall have been repaid in full and such
Borrower shall sign an acknowledgement that all obligations of the Lender
Parties to it are terminated; and
(b) The Administrative Agent shall have received such
replacement Notes, certificates, opinions, documents and/or instruments it
shall reasonably request.
4. 1997 Subordinated Debt Indenture. The disposition shall not be
prohibited by, result in a default or breach under, or trigger a mandatory
prepayment requirement under the terms of the 1997 Subordinated Debt Indenture.