EXHIBIT 10.6
FIRST AMENDMENT TO CREDIT AGREEMENT
FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment")
dated as of October 8, 2002, among Vanguard Health Systems,
Inc. (the "Borrower"), the lenders from time to time party to the
Credit Agreement referred to below (the "Lenders"), and Bank of
America, N.A., as Administrative Agent (the "Administrative
Agent"). Unless otherwise indicated, all capitalized terms used
herein and not otherwise defined herein shall have the respective
meanings provided to such terms in the Credit Agreement referred
to below.
W I T N E S S E T H:
WHEREAS, the Borrower, the Lenders, the Joint Lead
Arrangers, the Administrative Agent, the Syndication Agent and
the Co-Documentation Agents are parties to a Credit Agreement,
dated as of July 30, 2001 (the "Credit Agreement"); and
WHEREAS, subject to the terms and conditions of this
Amendment, the parties hereto wish to amend the Credit Agreement
as herein provided;
NOW, THEREFORE, it is agreed:
I. Consent.
1. Notwithstanding anything to the contrary contained in
Sections 9.01, 9.02, 9.04 and 9.05 of the Credit Agreement, the
BHS Acquisition shall be permitted in accordance with the terms
of that certain Purchase and Sale Agreement, dated as of October
8, 2002, among the Borrower, VHS San Antonio Partners, L.P. and
the Baptist Health System (as in effect on the date hereof, the
"BHS Acquisition Agreement"), provided that (i) the BHS
Acquisition Agreement and all other documentation related thereto
shall be in the form delivered on October 7, 2002 to the Lenders
with such amendments, modifications or waivers thereto as may be
agreed to by the Administrative Agent or the Required Lenders,
(ii) any Liens on any assets acquired as part of the BHS
Acquisition shall not have been incurred in anticipation of the
BHS Acquisition and shall not attach to any other property or
assets of the Borrower or any of its Subsidiaries and (iii) any
Indebtedness assumed by the Borrower and its Subsidiaries
pursuant to the BHS Acquisition Agreement (x) shall not exceed in
aggregate principal amount $10,000,000, (y) shall not constitute
debt for borrowed money (it being understood and agreed that
Capitalized Lease Obligations and purchase money Indebtedness
shall not constitute debt for borrowed money for purposes of this
clause (y)), and (z) shall not have been incurred in connection
with, or in anticipation or contemplation of, the BHS
Acquisition.
II. Amendments and Modifications to Credit Agreement.
1. Section 1.01(d)(iv) of the Credit Agreement is hereby
restated in its entirety as follows:
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"(iv) shall not (x) in the case of the Incremental Term
Loans provided pursuant to the Incremental Term Loan Commitment
Agreement delivered in connection with the First Amendment,
exceed $200,000,000 in aggregate principal amount for all such
Incremental Term Loans made by all Incremental Term Loan Lenders
party to such Incremental Term Loan Commitment Agreement and (y)
in the case of Incremental Term Loans other than those incurred
pursuant to preceding sub-clause (x), exceed $150,000,000 in
aggregate principal amount for all such other Incremental Term
Loans made by all Incremental Term Loan Lenders pursuant to this
sub-clause (y) and the various other Incremental Term Loan
Commitment Agreements, provided that the aggregate principal
amount of such other Incremental Term Loans may exceed such
$150,000,000 amount so long as at the time of the incurrence of
such other Incremental Term Loans in excess of such $150,000,000
amount the Consolidated Senior Leverage Ratio (calculated on a
Post-Test Period Pro Forma Basis and assuming that all such other
Incremental Term Loans to be incurred on such date or pursuant to
any other then existing Incremental Term Loan Commitment
Agreements have been incurred and the proceeds thereof have been
applied in a manner as certified to by an Authorized Officer of
the Borrower to the Administrative Agent) is less than 2.50:1.00,
provided further, however, that in no event shall the aggregate
principal amount of all Incremental Term Loans made by all
Incremental Term Loan Lenders pursuant to this sub-clause (y) and
the various Incremental Term Loan Commitment Agreements (other
than those provided as described in preceding sub-clause (x))
exceed $250,000,000".
2. Section 1.13(a)(iv) of the Credit Agreement is hereby
restated in its entirety as follows:
"(iv) the aggregate amount of all Incremental Term Loan
Commitments permitted to be provided pursuant to this Section
1.13 shall not (x) in the case of the Incremental Term Loan
Commitments provided pursuant to the Incremental Term Loan
Commitment Agreement delivered in connection with the First
Amendment, exceed $200,000,000 and (y) in the case of Incremental
Term Loan Commitments other than those described in preceding sub-
clause (x), exceed $150,000,000, provided that the Borrower may
request Incremental Term Loan Commitments (under this sub-clause
(y)) to be provided (as set forth in this Section 1.13) in excess
of $150,000,000 so long as at the time of such request and the
provision of such Incremental Term Loan Commitments, the
Consolidated Senior Leverage Ratio (calculated on a Post-Test
Period Pro Forma Basis and assuming that all Incremental Term
Loans to be incurred, pursuant to such Incremental Term Loan
Commitments (and any other then existing Incremental Term Loan
Commitment Agreements) have been incurred and the proceeds
thereof have been applied in a manner as certified to by an
Authorized Officer of the Borrower to the Administrative Agent)
is less than 2.50:1.00, provided further, however, that in no
event shall the aggregate amount of Incremental Term Loan
Commitments (other than those provided as described in preceding
sub-clause (x)) permitted to be provided pursuant to this Section
1.13 exceed $250,000,000".
3. Section 7.08(b) of the Credit Agreement is hereby
amended by (i) inserting the text "(other than Incremental B Term
Loans)" immediately following the text "Incremental Term Loans"
and (ii) inserting the following sentence at the end of such
Section 7.08(b):
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"All proceeds from Incremental B Term Loans shall be
used solely (i) to finance, in part, the BHS Acquisition and (ii)
to pay fees and expenses incurred in connection therewith".
4. Section 9.02(viii) is hereby amended by (i) deleting
clause (I) of the second proviso contained in such Section
9.02(viii) in its entirety and inserting the following new clause
"(I)" in lieu thereof:
"(I) the Consolidated Senior Leverage Ratio on the last
day of the most recently ended Test Period determined on a Post-
Test Period Pro Forma Basis (and after giving effect to any
Indebtedness incurred in connection with such Permitted
Acquisition or to finance same) is less than the Designated
Consolidated Senior Leverage Ratio Level on such last day and";
and (ii) deleting the reference to the ratio "0.50:1.00"
contained in clause (II) of the second proviso contained in such
Section 9.02(viii) and inserting the ratio "0.70:1.00" in lieu
thereof.
5. Section 9.03(vii) of the Credit Agreement is hereby
amended by: (i) inserting the text "(I)" immediately preceding
the text "PIK Preferred Stock (x) prior to January 1, 2008"
appearing in such Section 9.03(vii), (ii) deleting the text
"clauses (x) and (y)" appearing in such Section 9.03(vii) and
inserting the text "sub-clauses (x) and (y) of this clause (I)"
in lieu thereof and (iii) inserting the following new clause (II)
before the semi-colon appearing at the end of such Section
9.03(vii):
"and (II) BHS PIK Preferred Stock (x) prior to eighth
year anniversary of the consummation of the BHS Acquisition,
solely through the issuance of additional shares of BHS PIK
Preferred Stock (and not in cash) and (y) thereafter, in cash so
long as no Default or Event of Default then exists or would arise
therefrom, in the case of each of sub-clauses (x) and (y) of this
clause (II) pursuant to the BHS PIK Preferred Stock Documents".
6. Section 9.04 of the Credit Agreement is hereby amended
by: (a) deleting the word "and" appearing at the end of clause
(xvi) thereof, (b) redesignating existing clause (xvii) thereof
as clause (xviii) and (c) inserting the following new clause
(xvii) immediately following clause (xvi) of such Section 9.04:
"(xvii) unsecured subordinated Indebtedness of the
Borrower, but not any Subsidiary thereof, incurred pursuant to
the Convertible Subordinated Debt, in an aggregate principal
amount not to exceed $17,641,800 less the amount of any
repayments thereof after the First Amendment Effective Date;
and".
7. Section 9.07(b) of the Credit Agreement is hereby
amended by deleting the table in such Section in its entirety and
inserting the following table in lieu thereof:
"Period Amount
July 1, 2002 through June 30, 2003 $80,000,000
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"Period Amount
July 1, 2003 through June 30, 2004 $60,000,000
July 1, 2004 through June 30, 2005 $50,000,000
July 1, 2005 through June 30, 2006 $45,000,000
Each fiscal year of the Borrower $50,000,000"
ended after June 30, 2006 .
8. (a) Section 9.07(d) of the Credit Agreement is hereby
amended by deleting references to "$75,000,000" and "$25,000,000"
appearing in such Section 9.07(d) and inserting the text
"$250,000,000" and "$50,000,000", respectively, in lieu thereof;
(b) Section 9.07(d) of the Credit Agreement is
hereby further amended by restating clause (ii) of the first
sentence thereof in its entirety as follows:
"(ii) on the date of the making of any Capital
Expenditure pursuant to this clause (d) the Consolidated Senior
Leverage Ratio on the last day of the most recently ended Test
Period shall be less than the Designated Consolidated Senior
Leverage Ratio Level on such last day".
9. Section 9.08 of the Credit Agreement is hereby amended
by deleting the table appearing in such Section 9.08 in its
entirety and inserting the following table in lieu thereof:
"Test Period Ending On Ratio
September 30, 2002 2.00:1.00
December 31, 2002 2.00:1.00
March 31, 2003 2.00:1.00
June 30, 2003 2.00:1.00
September 30, 2003 2.00:1.00
December 31, 2003 2.15:1.00
March 31, 2004 2.15:1.00
June 30, 2004 2.30:1.00
September 30, 2004 2.30:1.00
December 31, 2004 2.45:1.00
March 31, 2005 2.45:1.00
June 30, 2005 and 2.60:1.00".
thereafter
10. Section 9.09 of the Credit Agreement is hereby amended
by deleting the table appearing in such Section 9.09 in its entirety and
inserting the following table in lieu thereof:
"Test Period Ending On Ratio
September 30, 2002 5.50:1.00
December 31, 2002 5.50:1.00
March 31, 2003 5.50:1.00
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"Test Period Ending On Ratio
June 30, 2003 5.50:1.00
September 30, 2003 5.50:1.00
December 31, 2003 5.25:1.00
March 31, 2004 5.25:1.00
June 30, 2004 5.00:1.00
September 30, 2004 5.00:1.00
December 31, 2004 4.75:1.00
March 31, 2005 4.75:1.00
June 30, 2005 4.50:1.00
September 30, 2005 4.50:1.00
December 31, 2005 4.25:1.00".
and thereafter
11. Section 9.10(a)(i) of the Credit Agreement is hereby
amended by inserting the text ", any Convertible Subordinated
Debt" immediately after the text "Senior Subordinated Notes"
appearing therein.
12. Section 9.10(a)(ii) of the Credit Agreement is hereby
amended by: (i) deleting the text "or" immediately after the text
"Existing Indebtedness" and inserting a comma in lieu thereof and
(ii) inserting the text "or any BHS PIK Preferred Stock Document"
immediately after the text "any PIK Preferred Stock" appearing
therein.
13. Section 9.10(a)(iii) of the Credit Agreement is hereby
amended by (i) inserting the text ", any Convertible Subordinated
Debt Document" immediately after the first reference to "Senior
Subordinated Note Document" appearing therein, (ii) inserting the
text "(I) in the case of amendments and/or modifications to the
Senior Subordinated Note Documents or the Permitted Subordinated
Note Documents only" immediately preceding clause (x) appearing
therein and (iii) inserting the following clause "(II)" at the
end of the Section:
"and (II) in the case of amendments and/or
modifications to the Convertible Subordinated Debt Documents,
technical amendments or modifications thereto which do not amend
or modify the subordination provisions contained therein and are
not adverse to the interest of the Lenders in any material
respect".
14. Section 9.10(b) of the Credit Agreement is hereby
amended by inserting the text ", Convertible Subordinated Debt"
immediately following each reference to "Senior Subordinated
Notes" appearing therein.
15. Section 9.12(a)(i) of the Credit Agreement is hereby
amended by: (i) redesignating existing clause (y) of the
parenthetical statement appearing therein as clause (z) and (ii)
inserting the following new clause "(y)" immediately after clause
(x) of such parenthetical statement thereof:
", (y) the issuance of the BHS PIK Preferred Stock on
the First Amendment Effective Date and the issuance of additional
shares of BHS PIK Preferred Stock in payment of regularly
accruing dividends on theretofore outstanding BHS PIK Preferred
Stock".
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16. The definition of "Additional Capital Expenditures
Amount" appearing in Section 11.01 of the Credit Agreement is
hereby restated in its entirety as follows:
"Additional Capital Expenditures Amount" shall mean,
(I) for the fiscal year of the Borrower ending June 30, 2003, an
amount (not less than $0) equal to the product of (a) .05
multiplied by the remainder of (x) the consolidated net revenue
for such fiscal year attributable to Health Care Assets (other
than health maintenance organizations, physician practices, the
physician practice management business of Watermark Physician
Services, Inc. and BHS) of the Borrower and its Subsidiaries less
(y) the consolidated net revenue for the Borrower's fiscal year
ended June 30, 2002 (determined on a pro forma basis in a manner
consistent with the methodology used in preparing the financial
statements referred to in Section 7.05(b)) attributable to Health
Care Assets (other than health maintenance organizations,
physician practices, the physician practice management business
of Watermark Physician Services, Inc. and BHS) of the Borrower
and its Subsidiaries, and (II) for any fiscal year of the
Borrower after its fiscal year ending June 30, 2003, an amount
(not less than $0) equal to the product of (a) .05 multiplied by
the remainder of (x) the consolidated net revenue for such fiscal
year attributable to Health Care Assets (other than health
maintenance organizations, physician practices and the physician
practice management business of Watermark Physician Services,
Inc.) of the Borrower and its Subsidiaries less (y) the sum of
(1) the consolidated net revenue for the Borrower's fiscal year
ended June 30, 2002 (determined on a pro forma basis in a manner
consistent with the methodology used in preparing the financial
statements referred to in Section 7.05(b)) attributable to Health
Care Assets (other than health maintenance organizations,
physician practices, the physician practice management business
of Watermark Physician Services, Inc. and BHS) of the Borrower
and its Subsidiaries and (2) the net revenue attributable to
Health Care Assets of BHS for the fiscal year ended June 30, 2003
(determined on a pro forma basis in a manner consistent with the
methodology used in preparing the financial statements referred
to in Section 7.05(b)), (in each case as determined in good faith
by an Authorized Officer of the Borrower and set forth in
reasonable detail in the Compliance Certificate delivered by the
Borrower to the Administrative Agent within 90 days following
each fiscal year end of the Borrower pursuant to Section
8.01(d)).
17. The definition of "Change of Control" appearing in
Section 11.01 of the Credit Agreement is hereby amended by
restating clause (z) thereof in its entirety as follows:
"(z) a "Change of Control", as defined in the Senior
Subordinated Note Documents, the Convertible Subordinated Debt
Documents or the BHS PIK Preferred Stock Documents, shall occur
under the Senior Subordinated Note Documents, the Convertible
Subordinated Debt Documents or the BHS PIK Preferred Stock
Documents, as the case may be, or a comparable event, whether or
not so titled shall occur under any Permitted Subordinated Note
Document".
18. The definition of "Consolidated Senior Debt" appearing
in Section 11.01 of the Credit Agreement is hereby amended by (i)
deleting the word "and" appearing at the end of the sub-clause
(y)(i) thereof and inserting a comma in lieu thereof and (ii)
inserting at the end of such definition the text ", and (iii) the
aggregate principal amount of all Convertible Subordinated Debt
outstanding at such time (to the extent same are reflected in
Consolidated Debt at such time)".
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19. The definition of "Specified Construction Projects"
appearing in Section 11.01 of the Credit Agreement is hereby
amended by inserting the text "(including for this purpose any
construction project for the addition of hospital bed capacity)"
immediately following the first instance the text "Health Care
Assets" appears in said definition.
20. Section 11.01 of the Credit Agreement is hereby further
amended by inserting in the appropriate alphabetical order the
following new definitions:
"BHS" shall mean the five-hospital network known as the
Baptist Health Systems located in San Antonio, Texas.
"BHS Acquisition" shall mean the acquisition of BHS by
one or more Subsidiaries of the Borrower.
"BHS PIK Preferred Stock" shall mean pay-in-kind
preferred stock of the Borrower $0.01 par value per share, and
any additional shares thereof issued as pay-in-kind Dividends,
issued to the seller of BHS as partial consideration for the BHS
Acquisition.
"BHS PIK Preferred Stock Document" shall mean the
Certificate of Designation, Preferences and Rights for the BHS
PIK Preferred Stock, as in effect on the First Amendment
Effective Date and as the same may be amended, modified or
supplemented from time to time in accordance with the terms
hereof and thereof.
"Convertible Subordinated Debt" shall mean unsecured
convertible subordinated debt of the Borrower evidenced by that
certain 8.18% Convertible Subordinated Note due 2012 issued to
the seller of BHS as partial consideration for the BHS
Acquisition, as in effect on the First Amendment Effective Date
and as the same may be amended, modified or supplemented from
time to time in accordance with the terms hereof and thereof.
"Convertible Subordinated Debt Documents" shall mean
that certain 8.18% Convertible Subordinated Note due 2012 and
each other document or agreement relating to the issuance of such
Convertible Subordinated Note due 2012.
"Designated Consolidated Senior Leverage Ratio Level"
shall mean, on the last day of any Test Period set forth below,
the ratio set forth opposite such Test Period:
Test Period Ending On Ratio
September 30, 2002 3.00:1.00
December 31, 2002 3.00:1.00
March 31, 2003 3.00:1.00
June 30, 2003 3.00:1.00
September 30, 2003 3.00:1.00
December 31, 2003 2.75:1.00
March 31, 2004 2.75:1.00
June 30, 2004 2.75:1.00
September 30, 2004 2.75:1.00
December 31, 2004 and thereafter 2.50:1.00
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"First Amendment" shall mean the First Amendment to
this Credit Agreement, dated October 8, 2002.
"First Amendment Effective Date" shall have the meaning
provided in the First Amendment.
"Incremental B Term Loans" shall mean the Loans made
pursuant to the Incremental Term Loan Commitment Agreement
executed and delivered by the Lenders party thereto on the date
hereof in connection with the First Amendment.
21. Section 11.02(b)(i) of the Credit Agreement is hereby
amended by: (i) deleting the text "0.5" appearing in clause (x)
of the proviso of such Section 11.02(b)(i) and inserting the text
"0.7" in lieu thereof and (ii) deleting the text "50%" appearing
in clause (y) of the proviso of such Section 11.02(b)(i) and
inserting the text "70%" in lieu thereof.
22. Notwithstanding anything to the contrary contained in
Section 9.07 of the Credit Agreement, the Borrower and the
Lenders hereby agree that the Borrower shall not be permitted to
carry over any of the Unused Capital Expenditure Amount for the
Borrower's fiscal year ending June 30, 2002 to make any Capital
Expenditures in its fiscal year ending June 30, 2003 or in any
future fiscal year of the Borrower.
23. The Borrower and each Lender hereby agrees that the
sole "lead arranger" and "book manager" with respect to the
Incremental B Term Loans is Banc of America Securities LLC and
that there is no other "lead arranger", "book manager" or other
agent with respect thereto.
III. Miscellaneous Provisions.
1. In order to induce the Lenders to enter into this
Amendment, the Borrower hereby represents and warrants that:
(a) no Default or Event of Default exists as of the
First Amendment Effective Date (as defined below), both
before and immediately after giving effect to this
Amendment; and
(b) all of the representations and warranties
contained in the Credit Agreement and the other Credit
Documents are true and correct in all material respects on
the First Amendment Effective Date, both before and after
giving effect to this Amendment, with the same effect as
though such representations and warranties had been made on
and as of the First Amendment Effective Date (it being
understood that any representation or warranty made as of a
specific date or for a given period shall be true and
correct in all material respects as of such specified date
or such given period, as the case may be).
2. This Amendment is limited as specified and shall not
constitute a modification, acceptance or waiver of any other
provision of the Credit Agreement or any other Credit Document.
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3. This Amendment may be executed in any number of
counterparts and by the different parties hereto on separate
counterparts, each of which counterparts when executed and
delivered shall be an original, but all of which shall together
constitute one and the same instrument. A complete set of
counterparts shall be lodged with the Borrower and the
Administrative Agent.
4. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
5. This Amendment shall become effective on the date (the
"First Amendment Effective Date") when each of the following
conditions shall have been satisfied:
(i) the Borrower and the Required Lenders shall have
signed a counterpart hereof (whether the same or different
counterparts) and shall have delivered (including by way of
facsimile transmission) the same to the Administrative Agent
at the Notice Office;
(ii) each of the Lenders shall have received audited
consolidated financial statements of BHS for its fiscal
years 2000, 2001 and 2002, which (x) in the case of such
financial statements for BHS' fiscal year 2001, shall not be
materially different, in the reasonable judgment of the
Administrative Agent, from the draft audited financial
statements for such year previously received by the Lenders
unless such differences are acceptable to the Administrative
Agent and (y) in the case of such financial statements for
BHS' fiscal year 2002, shall demonstrate that BHS'
consolidated EBITDA for such fiscal year 2002 was at least
$10,000,000; and
(iii) (x) an Incremental Term Loan Commitment
Agreement in the form of Exhibit A to this Amendment shall
have been executed and delivered by the Borrower and the
Incremental Term Loan Lenders party thereto providing for up
to, but no more than, $200 million of Incremental Term Loans
(as defined in such Incremental Term Loan Commitment
Agreement) to be funded by such Incremental Term Loan
Lenders on the terms thereof and of the Credit Agreement
(and such amount of Incremental Term Loans, when added to
the cash utilized by the Borrower as contemplated in Section
7(a) of such Incremental Term Loan Commitment Agreement,
shall be sufficient to effect the BHS Acquisition), (y) each
of the conditions precedent set forth in such Incremental
Term Loan Commitment Agreement (including, without
limitation, the consummation of the BHS Acquisition as
provided therein) shall have been satisfied and not waived
except with the approval of the Required Lenders and (z) the
Incremental Term Loans described in preceding clause (x)
shall have been funded, and the BHS Acquisition shall have
been consummated, in each case concurrently with the
occurrence of the First Amendment Effective Date.
6. From and after the First Amendment Effective Date, all
references in the Credit Agreement and each of the other Credit
Documents to the Credit Agreement shall be deemed to be
references to the Credit Agreement as modified hereby.
* * *
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IN WITNESS WHEREOF, each of the parties hereto has
caused a counterpart of this Amendment to be duly executed and
delivered as of the date first above written.
VANGUARD HEALTH SYSTEMS, INC.,
as Borrower
By:/s/_____________________________
Name:
Title:
BANK OF AMERICA, N.A.,
Individually and as Administrative
Agent
By:/s/_____________________________
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ SENIOR FUNDING, INC.
By:/s/_____________________________
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION
(f/k/a First Union National Bank)
By:/s/_____________________________
Name:
Title:
GENERAL ELECTRIC CAPITAL
CORPORATION
By:________________________________
Name:
Title:
LASALLE BANK NATIONAL ASSOCIATION
By:/s/_____________________________
Name:
Title:
CREDIT SUISSE FIRST BOSTON
By:/s/_____________________________
Name:
Title:
UBS AG, STAMFORD BRANCH
By:________________________________
Name:
Title:
CREDIT LYONNAIS AMERICAS
By:/s/_____________________________
Name:
Title:
By:/s/_____________________________
Name:
Title:
EXHIBIT A
INCREMENTAL TERM LOAN COMMITMENT AGREEMENT
[Bank of America, N.A.]
[Other Lenders]
Vanguard Health Systems, Inc.
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Incremental Term Loan Commitments
Ladies and Gentlemen:
Reference is hereby made to the Credit Agreement, dated
as of July 30, 2001 (as amended, modified or supplemented from
time to time, the "Credit Agreement"), among Vanguard Health
Systems, Inc. (the "Borrower" or "you"), the lenders from time to
time party thereto (the "Lenders"), Banc of America Securities
LLC and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc., as Joint Lead
Arrangers and Book Managers, Bank of America, N.A., as
Administrative Agent (in such capacity, the "Administrative
Agent"), ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Senior Funding, Inc., as Syndication
Agent and Wachovia Bank, National Association (formerly known as
First Union National Bank) and General Electric Capital
Corporation, as Co-Syndication Agents. Unless otherwise defined
herein, capitalized terms used herein shall have the respective
meanings set forth in the Credit Agreement (for this purpose,
after giving effect to the First Amendment to Credit Agreement,
dated October 8, 2002 (the "First Amendment")).
Each Lender (each an "Incremental Term Loan Lender")
party to this letter agreement (this "Agreement") hereby
severally agrees to provide the Incremental Term Loan Commitment
set forth opposite its name on Annex I attached hereto (for each
such Incremental Term Loan Lender, its "Incremental Term Loan
Commitment"). Each Incremental Term Loan Commitment provided
pursuant to this Agreement shall be subject to the terms and
conditions set forth in the Credit Agreement, including Section
1.13 thereof.
Each Incremental Term Loan Lender, the Borrower and the
Administrative Agent acknowledge and agree that the Incremental
Term Loan Commitments provided pursuant to this Agreement shall
constitute Incremental Term Loan Commitments of the respective
Tranche specified in Annex I attached hereto and, upon the
incurrence of Incremental Term Loans pursuant to such Incremental
Term Loan Commitments, shall constitute Incremental Term Loans
under such specified Tranche for all purposes of the Credit
Agreement and the other Credit Documents.
Each Incremental Term Loan Lender and the Borrower
further agree that, with respect to the Incremental Term Loan
Commitments provided by such Incremental Term Loan Lender
pursuant to this Agreement, such Incremental Term Loan Lender
shall receive such
upfront fees, if any, as are specified in Annex I attached
hereto, which upfront fee shall be due and payable to such
Incremental Term Loan Lender upon the Agreement Effective Date
(as defined below) or as otherwise specified in said Annex I.
Each Incremental Term Loan Lender party to this
Agreement (i) confirms that it has received a copy of the Credit
Agreement and the other Credit Documents, together with copies of
the financial statements referred to therein and such other
documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Agreement
and, to the extent applicable, to become a Lender under the
Credit Agreement, (ii) agrees that it will, independently and
without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit
Agreement, (iii) appoints and authorizes the Administrative Agent
and the Collateral Agent to take such action as agent on its
behalf and to exercise such powers under the Credit Agreement and
the other Credit Documents as are delegated to the Administrative
Agent and the Collateral Agent, as the case may be, by the terms
thereof, together with such powers as are reasonably incidental
thereto, (iv) agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender,
and (v) in the case of each lending institution organized under
the laws of a jurisdiction outside the United States, attaches
the applicable forms described in Section 4.04(b) of the Credit
Agreement certifying as to its entitlement to a complete
exemption from United States withholding taxes with respect to
all payments to be made under the Credit Agreement and the other
Credit Documents. Upon the date of (i) the execution of a
counterpart of this Agreement by such Incremental Term Loan
Lenders, the Administrative Agent, the Borrower, the Majority
Lenders of each Tranche (if any) required to consent to the
provision of the Incremental Term Loan Commitments to be provided
pursuant to this Agreement as provided in Section 1.13(a)(ix) and
1.13(a)(x), as the case may be, of the Credit Agreement, (ii) the
delivery to the Administrative Agent of a fully executed copy
(including by way of counterparts and by facsimile) hereof, (iii)
the payment of any fees required in connection herewith and (iv)
the satisfaction of all conditions precedent set forth in Section
7 of Annex I hereto (such date, the "Agreement Effective Date"),
each Incremental Term Loan Lender party hereto (i) shall be
obligated to make the Incremental Term Loans provided to be made
by it as provided in this Agreement on the terms, and subject to
the conditions, set forth in the Credit Agreement and (ii) to the
extent provided in this Agreement, shall have the rights and
obligations of a Lender thereunder and under the other Credit
Documents. The maximum number of drawings with respect to the
Incremental Term Loan Commitments provided pursuant to this
Agreement shall be as specified in Annex I attached hereto.
Furthermore, any undrawn Incremental Term Loan Commitments
provided pursuant to this Agreement shall expire on the date
specified in Annex I attached hereto.
The Borrower acknowledges and agrees that (i) it shall
be liable for all Obligations with respect to the Incremental
Term Loan Commitments provided hereby including, without
limitation, any Loans made pursuant thereto and (ii) all such
Obligations (including any such Loans) shall be entitled to the
benefits of the Security Documents. Attached hereto as Annex II
are executed resolutions of the Borrower authorizing the
incurrence of the Incremental Term Loans to be incurred pursuant
to the Incremental Term Loan Commitments provided hereunder.
2
Each Subsidiary Guarantor acknowledges and agrees that
all Obligations with respect to the Incremental Term Loan
Commitments provided hereby and any Loans made pursuant thereto
shall (i) be fully guaranteed pursuant to the Subsidiaries
Guaranty in accordance with the terms and provisions thereof and
(ii) be entitled to the benefits of the Security Documents, and
attached hereto as Annex III are resolutions from each such
Subsidiary Guarantor covering the matters set forth in preceding
clauses (i) and (ii).
The Obligations to be incurred pursuant to the
Incremental Term Loan Commitments provided hereunder are
permitted by, and constitute "Senior Indebtedness" and
"Designated Senior Indebtedness" (or any similar terms) under (i)
the Convertible Subordinated Debt and (ii) the Senior
Subordinated Note Documents, and, after the issuance of any
Permitted Subordinated Notes, the Permitted Senior Subordinated
Note Documents, and attached hereto as Annex IV are calculations
showing that such Obligations are permitted by the terms of the
documentation referred to in this clause (ii).
Attached hereto as Annex V is an opinion of Waller,
Lansden, ▇▇▇▇▇▇ & ▇▇▇▇▇ counsel to the Borrower, delivered as
required pursuant to Section 1.13(b)(v) of the Credit Agreement.
You may accept this Agreement by executing the enclosed
copies in the space provided below, and returning a copy of same
to us before the close of business on October ___, 2002. If you
do not so accept this Agreement by such time, our Incremental
Term Loan Commitments set forth in this Agreement shall be deemed
cancelled.
After the execution and delivery to the Administrative
Agent of a fully executed copy of this Agreement (including by
way of counterparts and by facsimile) by the parties hereto and
the effectiveness hereof in accordance with the provisions
herein, this Agreement shall constitute a Credit Document and may
only be changed, modified or varied by written instrument in
accordance with the requirements for the modification of Credit
Documents pursuant to Section 13.12 of the Credit Agreement.
3
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.
Very truly yours,
BANK OF AMERICA, N.A.
By__________________________
Name:
Title:
[OTHER INCREMENTAL TERM
LOAN LENDERS]
Agreed and Accepted
this ___ day of October ___, 2002
VANGUARD HEALTH SYSTEMS, INC.
By:_____________________________
Name:
Title:
BANK OF AMERICA, N.A.,
as Administrative Agent
By:_____________________________
Name:
Title:
4
Each Subsidiary Guarantor acknowledges and agrees to the
foregoing provisions of this Incremental Term Loan Commitment
Agreement, specifically including the acknowledgments and
agreements made by it pursuant to the seventh paragraph of the
Incremental Term Loan Commitment Agreement.
901:
VHS ACQUISITION CORPORATION
VHS OUTPATIENT CLINICS, INC.
VHS OF PHOENIX, INC.
VHS OF ARROWHEAD, INC.
PLEASANT PROPERTIES, INC.
VHS OF SOUTH PHOENIX, INC.
VHS IMAGING CENTERS, INC.
VHS OF ANAHEIM, INC.
VHS OF ORANGE COUNTY, INC.
VHS HOLDING COMPANY, INC.
VHS OF HUNTINGTON BEACH, INC.
VHS OF ILLINOIS, INC.
▇▇▇▇▇▇▇ HEALTH PROVIDERS, INC.
▇▇▇▇▇▇▇ MANAGEMENT SERVICES,
INC.
MIDWEST CLAIMS PROCESSING, INC.
PROS TEMPORARY STAFFING, INC.
WATERMARK PHYSICIAN SERVICES,
INC.
VHS GENESIS LABS, INC.
▇▇▇▇▇▇▇ MEDICAL RECORDS, INC.
VANGUARD HEALTH MANAGEMENT,
INC.
TRINITY MEDCARE, INC.
V-II ACQUISITION CO., INC.
VANGUARD HEALTH FINANCIAL
COMPANY, INC.
VHS OF RANCOCAS, INC.
VHS PHOENIX HEALTH PLAN, INC.
HOSPITAL DEVELOPMENT OF
WEST PHOENIX, INC.
HOSPITAL DEVELOPMENT COMPANY
NUMBER 1, INC.
HOSPITAL DEVELOPMENT COMPANY
NUMBER 2, INC.
VOLUNTEER INSURANCE LTD.,
each as a Guarantor
5
By:_____________________________
Title:
Duly authorized to sign on behalf of
each of the foregoing entities
VHS ACQUISITION SUBSIDIARY
NUMBER 1, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 2, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 3, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 4, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 5, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 6, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 7, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 8, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 9, INC.
VHS ACQUISITION SUBSIDIARY
NUMBER 10, INC.,
each as a Guarantor
By:_____________________________
Title:
6
Duly authorized to sign on behalf of
each of the foregoing entities
THE ANAHEIM VHS LIMITED
PARTNERSHIP, as a Guarantor
By: VHS of Anaheim, Inc., its
General Partner
By:_____________________________
Title:
THE HUNTINGTON BEACH VHS LIMITED
PARTNERSHIP, as a Guarantor
By: VHS of Huntington Beach,
Inc., its General Partner
By:_____________________________
Title:
HEALTHCARE COMPLIANCE, L.L.C.,
as a Guarantor
By: Vanguard Health
Management, Inc., its Member
By:_____________________________
Title:
VHS SAN ANTONIO PARTNERS, L.P.,
as a Guarantor
By: VHS Acquisition Subsidiary
Number 5, Inc., its General
Partner
By:_____________________________
Title:
7
THE VHS ARIZONA IMAGING CENTERS
LIMITED PARTNERSHIP, as a Guarantor
By: VHS Imaging Centers, Inc.,
its General Partner
By:_____________________________
Title:
8
ANNEX I
TERMS AND CONDITIONS FOR
INCREMENTAL TERM LOAN COMMITMENT AGREEMENT
1. Incremental Term Loan Commitment Amounts (as of the
Agreement Effective Date):
Amount of Incremental
Name of Lender Term Loan Commitment
Total $200,000,000
2. Designation of Tranche of Incremental Term Loan Commitments
(and Incremental Term Loans to be funded thereunder): B
3. Maturity Date ________, 2009 (the "Incremental Term Loan
Maturity Date").
4. Dates for, and amounts of, Scheduled Incremental Term Loan
Repayments:
Date Amount
March 31, 2003 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
June 30, 2003 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
September 30, 2003 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
December 31, 2003 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
March 31, 2004 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
June 30, 2004 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
September 30, 2004 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
December 31, 2004 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
March 31, 2005 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
June 30, 2005 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
September 30, 2005 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
December 31, 2005 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
March 31, 2006 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
June 30, 2006 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
September 30, 2006 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
December 31, 2006 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
March 31, 2007 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
June 30, 2007 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
September 30, 2007 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
December 31, 2007 0.25% of the initial
agreement principal
2
amount of Incremental Term Loans
hereunder
March 31, 2008 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
June 30, 2008 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
September 30, 2008 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
December 31, 2008 0.25% of the initial
agreement principal amount of
Incremental Term Loans
hereunder
March 31, 2009 23.5% of the initial
aggregate principal amount of
Incremental Term Loans
hereunder
June 30, 2009 23.5% of the initial
aggregate principal amount of
Incremental Term Loans
hereunder
September 30, 2009 23.5% of the initial
aggregate principal amount of
Incremental Term Loans
hereunder
Incremental Term 23.5% of the initial
Loan Maturity aggregate principal amount of
Date Incremental Term Loans
hereunder
5. Rules for application of voluntary and mandatory
prepayments:
As provided in Sections 4.01(a)(vi)(A) and
4.02(h)(iv)(A), as the case may be, i.e., (1) first, to
reduce the Scheduled Incremental Term Loan Repayments
which will become due within twelve months after the
date of such prepayment in direct order of maturity of
the dates of such Scheduled Incremental Term Loan
Repayments and (2) second, to the extent in excess of
the amount required to be applied as provided in the
preceding clause (1), to reduce the then remaining
Scheduled Incremental Term Loan Repayments on a pro
rata basis (based on the then remaining principal
amounts of such Scheduled Incremental Term Loan
Repayments).
3
6. Interest Rates:
Applicable Margin for Incremental B Term Loans
maintained as (i) Base Rate Loans shall be _____%, and
(ii) Eurodollar Loans shall be _____%.
It is understood and agreed that prior to the earlier
of (i) the 90th day following the incurrence of the
Incremental Term Loans hereunder and (ii) the date upon
which the Administrative Agent shall determine in its
sole discretion that the primary syndication of the
Incremental Term Loans has been completed, Incremental
Term Loans maintained as Eurodollar Loans may only be
incurred having (x) one week Interest Periods, each of
which shall begin and end on the same day of the week,
or (y) any otherwise allowed Interest Period (pursuant
to Section 1.09 of the Credit Agreement) so long as the
Borrower pays any breakage costs incurred by any Lender
in connection with such primary syndication.
7. Other Conditions:
(a) The structure and all terms of, and the documentation for,
each component of the BHS Acquisition shall be as set forth in
the BHS Acquisition Agreement (as defined in Section I.1 of the
First Amendment) and the documentation related thereto, in each
case delivered on October 7, 2002 to the Lenders and the
Incremental Term Loan Lenders party to the Incremental Term Loan
Commitment Agreement to which this Annex I is attached, with such
amendments, modifications or waivers thereto as may be agreed to
by the Administrative Agent or the Required Lenders (for this
purpose determined including each Lender's Revolving Loan
Commitments as well as such Lender's Incremental Term Loan
Commitments and Incremental Term Loans (the "Aggregate Required
Lenders")), and such documentation shall be in full force and
effect. The BHS Acquisition shall have been consummated in
accordance with the respective documentation therefore in all
material respects and in accordance with all applicable laws.
(b) After giving effect to the BHS Acquisition and financings
incurred in connection therewith, the Borrower and its
Subsidiaries will have no outstanding Indebtedness or preferred
stock other than: (w) the PIK Preferred Stock, (x) the BHS PIK
Preferred Stock, (y) Indebtedness outstanding under the Credit
Agreement and (z) Indebtedness outstanding as permitted pursuant
to Section 9.04 of the Credit Agreement on the Agreement
Effective Date.
(c) The Borrower shall have received cash proceeds in an amount
equal to at least $50,000,000 from either the MSCP Group or
management or both in consideration of common equity issued by
the Borrower to them.
(d) The Borrower shall have issued to the seller of BHS the
Convertible Subordinated Debt, and each of the Convertible
Subordinated Debt Documents shall be in the form delivered on
October 7, 2002 to the Lenders and the Incremental Term Loan
Lenders party to the Incremental Term
4
Loan Commitment Agreement to which this Annex I is attached,
with such amendments, modifications or waivers thereto as may be
agreed to by the Administrative Agent or the Aggregate Required
Lenders.
(e) VHS Acquisition Subsidiary Number 5, Inc. shall have issued
19.9% of its capital stock to the seller of BHS and the
documentation related thereto shall be in the form delivered on
October 7, 2002 to the Lenders and the Incremental Term Loan
Lenders party to the Incremental Term Loan Commitment Agreement
to which this Annex I is attached, with such amendments,
modifications or waivers thereto as may be agreed to by the
Administrative Agent or the Aggregate Required Lenders.
(f) The Borrower shall have utilized approximately $45,000,000
of its cash on hand (subject to adjustments to such amount in
connection with Special Capital Expenditures (as defined below)
and any purchase price adjustment in connection with the BHS
Acquisition) to finance, in part, the BHS Acquisition and to pay
fees and expenses in connection therewith prior to the
utilization of the Incremental Term Loans to be incurred pursuant
to the Incremental Term Loan Commitment Agreement to which this
Annex I is attached for such purpose. No Loans other than the
Incremental Term Loans to be incurred pursuant to the Incremental
Term Loan Commitment Agreement to which this Annex I is attached
shall be incurred to finance any part of the BHS Acquisition or
to pay any fees or expenses in connection therewith. For the
purposes of this Section 7, the term "Special Capital
Expenditures" shall mean both (i) BHS' cost of Capital
Expenditures made after July 15, 2002 and prior to the Agreement
Effective Date, in an amount not to exceed $3,500,000, in
connection with making those repairs related to life and safety
issues which state regulators have requested that BHS make as
soon as practicable and (ii) BHS' cost of other non-routine
capital expenditures made after July 15, 2002 that are approved
in writing by both BHS and Borrower.
(g) All necessary governmental (domestic and foreign) and third
party approvals and/or consents required in connection with the
transactions contemplated by the BHS Acquisition and otherwise
referred to in the First Amendment shall have been obtained and
remain in effect. Additionally, there shall not exist any
judgment, order, injunction or other restraint prohibiting or
imposing materially adverse conditions upon the BHS Acquisition
or the transactions contemplated by the Incremental Term Loan
Commitment Agreement to which this Annex I is attached.
(h) No litigation by any entity (private or governmental) shall
be pending or threatened with respect to the BHS Acquisition, the
Incremental Term Loans to be incurred pursuant to the Incremental
Term Loan Commitment Agreement to which this Annex I is attached
or the Credit Agreement or any documentation executed in
connection therewith, or could reasonably be expected to have a
material adverse effect on the business, property, assets,
liabilities
5
(actual or contingent), operations or condition
(financial or otherwise) of the Borrower and its Subsidiaries
taken as a whole.
(i) The Administrative Agent shall have received legal opinions
from counsel, and covering matters, acceptable to the
Administrative Agent. None of the Incremental Term Loans to be
incurred pursuant to the Incremental Term Loan Commitment
Agreement to which this Annex I is attached or any other
financing to the Borrower (and neither the guaranties thereof nor
the security thereof) shall cause a violation or breach of any
agreement relating to any existing Indebtedness of the Borrower
or any of its Subsidiaries (including, without limitation, the
Senior Subordinated Notes and the Convertible Subordinated Debt),
or any other material contract, of the Borrower or any of its
Subsidiaries.
(j) All costs, fees, expenses (including, without limitation,
legal fees and expenses) and other compensation contemplated by
the First Amendment and the Incremental Term Loan Commitment
Agreement to which this Annex I is attached, payable to the
Lender and the Administrative Agent shall have been paid to the
extent due.
(k) The existing and new Subsidiary Guarantors shall have
executed and delivered (or acknowledged) the Subsidiaries
Guaranty. Each new Subsidiary Guarantor which is required to
execute a counterpart of the Subsidiaries Guaranty shall be
required to sign a counterpart of each of the Security Documents
and, to the extent required, enter into Mortgages, and thereby
provide a security interest in all of the Collateral owned by
each such new Subsidiary Guarantor to secure all Obligations
(including the Incremental Term Loans) owed by each such new
Subsidiary Guarantor under the Credit Documents to which it is a
party.
(l) The shareholders of the VHS Acquisition Subsidiary Number 5,
Inc. shall have executed a Shareholders Agreement which shall
provide that VHS Acquisition Subsidiary Number 5, Inc. may take
any action required by the Credit Agreement including, without
limitation, becoming a party to the Subsidiaries Guaranty and the
Security Documents, which Shareholders Agreement shall be in the
form delivered on October 7, 2002 to the Lenders and the
Incremental Term Loan Lenders party to the Incremental Term Loan
Commitment Agreement to which this Annex I is attached, with such
amendments, modifications or waivers thereto as may be agreed to
by the Administrative Agent or the Aggregate Required Lenders.
(m) The Borrower shall have issued to the seller of BHS the BHS
PIK Preferred Stock, and the BHS PIK Preferred Stock Document
shall be in the form delivered on October 7, 2002 to the Lenders
and the Incremental Term Loan Lenders party to the Incremental
Term Loan Commitment Agreement to which this Annex I is attached,
with such amendments, modifications or waivers thereto as may be
agreed to by the Administrative Agent or the Aggregate Required
Lenders.
6
(n) The Lenders shall have received from the chief financial
officer of the Borrower a solvency certificate, in form of
Exhibit L to the Credit Agreement.
(o) The Required Lenders (for this purpose excluding any
Lender's Incremental Term Loans and Incremental Term Loan
Commitments provided pursuant to the Incremental Term Loan
Commitment Agreement to which this Annex I is attached) shall
have executed and delivered the First Amendment.
(p) The Borrower shall be in compliance with each of Section
9.08 and 9.09 of the Credit Agreement (after giving effect to the
First Amendment), with the calculations necessary to determine
such compliance to be made on a Pro Forma Basis after giving
effect to the BHS Acquisition, the incurrence of the Incremental
Term Loans pursuant to the Incremental Term Loan Commitment
Agreement to which this Annex I is attached and all other
transactions consummated in connection therewith, and the
Borrower shall have delivered to the Administrative Agent and
each Lender (including, for this purpose each Incremental Term
Loan Lender) an officer's certificate from the Chief Financial
Officer of the Borrower certifying as to the matters above and
setting forth in reasonable detail the calculations necessary to
certify to such matters.
(q) All representations and warranties contained in the
Credit Agreement and the other Credit Documents shall be true and
correct in all material respects as of the Agreement Effective
Date (although any representations and warranties which
specifically relate to a given date or period shall be true and
correct in all material respects as of the respective date or for
the respective period, as the case may be).
(r) No Default or Event of Default shall exist and be
continuing on the Agreement Effective Date.
8. Maximum Number of Drawings permitted with respect to the
Incremental Term Loan Commitments provided pursuant to the
Incremental Term Loan Commitment Agreement to which this Annex I
is attached: 1
9. Expiration date of any undrawn Incremental Term Loan
Commitments provided pursuant to the Incremental Term Loan
Commitment Agreement pursuant to which this Annex 1 is attached:
5:30 pm (EST) January 3, 2003, or, if earlier, the termination of
that certain Purchase and Sale Agreement, dated as of October
8, 2002, among the Borrower, VHS San Antonio Partners, L.P. and
the Baptist Health System.
7