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EXHIBIT 4.2
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AMENDED AND RESTATED
CREDIT AGREEMENT
DATED AS OF JULY 1, 1998,
AMONG
VISION TWENTY-ONE, INC.,
THE BANKS PARTY HERETO,
AND
BANK OF MONTREAL,
as Agent
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TABLE OF CONTENTS
SECTION DESCRIPTION PAGE
SECTION 1. THE CREDIT FACILITIES...............................................................1
Section 1.1. Revolving Credit Commitments....................................................1
Section 1.2. Letters of Credit...............................................................2
Section 1.3. Term Credit Commitments.........................................................4
Section 1.4. Applicable Interest Rates.......................................................5
Section 1.5. Minimum Borrowing Amounts.......................................................8
Section 1.6. Manner of Borrowing Loans and Designating Applicable
Interest Rates..................................................................8
Section 1.7. Interest Periods...............................................................10
Section 1.8. Maturity of Loans..............................................................11
Section 1.9. Prepayments....................................................................12
Section 1.10. Default Rate...................................................................13
Section 1.11. The Notes......................................................................13
Section 1.12. Funding/Hedging Indemnity......................................................14
Section 1.13. Commitment Terminations........................................................15
SECTION 2. FEES, EXTENSIONS, AND SUBSTITUTION OF BANKS........................................16
Section 2.1. Fees...........................................................................16
Section 2.2. Extensions of the Revolving Credit Termination Date............................17
Section 2.3. Substitution of Banks..........................................................18
SECTION 3. PLACE AND APPLICATION OF PAYMENTS..................................................18
SECTION 4. COLLATERAL AND GUARANTIES..........................................................20
Section 4.1. Collateral.....................................................................20
Section 4.2 Collections....................................................................20
Section 4.3. Guaranties.....................................................................21
Section 4.4. Further Assurances.............................................................21
Section 4.5. Liens on After-Acquired Real Property..........................................21
SECTION 5. DEFINITIONS; INTERPRETATION........................................................22
Section 5.1. Definitions....................................................................22
Section 5.2. Interpretation.................................................................35
Section 5.3. Change in Accounting Principles................................................35
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SECTION 6. REPRESENTATIONS AND WARRANTIES.....................................................35
Section 6.1. Organization and Qualification.................................................35
Section 6.2. Subsidiaries...................................................................36
Section 6.3. Authority and Validity of Obligations..........................................36
Section 6.4. Use of Proceeds; Margin Stock..................................................37
Section 6.5. Financial Reports..............................................................37
Section 6.6. No Material Adverse Change.....................................................37
Section 6.7. Full Disclosure................................................................38
Section 6.8. Trademarks, Franchises, and Licenses...........................................38
Section 6.9. Governmental Authority and Licensing...........................................38
Section 6.10. Good Title.....................................................................38
Section 6.11. Litigation and Other Controversies.............................................38
Section 6.12. Taxes..........................................................................38
Section 6.13. Approvals......................................................................39
Section 6.14. Affiliate Transactions.........................................................39
Section 6.15. Investment Company; Public Utility Holding Company.............................39
Section 6.16. ERISA..........................................................................39
Section 6.17. Compliance with Laws...........................................................39
Section 6.18. Other Agreements...............................................................40
Section 6.19. Solvency.......................................................................40
Section 6.20. Capital Structure..............................................................40
Section 6.21. Year 2000 Compliance...........................................................40
Section 6.22. No Default.....................................................................40
SECTION 7. CONDITIONS PRECEDENT...............................................................40
Section 7.1. Initial Credit Event...........................................................41
Section 7.2. All Credit Events..............................................................42
SECTION 8. COVENANTS..........................................................................43
Section 8.1. Maintenance of Business........................................................43
Section 8.2. Maintenance of Properties......................................................43
Section 8.3. Taxes and Assessments..........................................................43
Section 8.4. Insurance......................................................................43
Section 8.5. Financial Reports..............................................................43
Section 8.6. Inspection.....................................................................45
Section 8.7. Current Ratio..................................................................46
Section 8.8. Total Funded Debt/Adjusted EBITDA Ratio........................................46
Section 8.9. Net Worth......................................................................46
Section 8.10. Interest Coverage Ratio........................................................46
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Section 8.11. Debt Service Coverage Ratio....................................................47
Section 8.12. Capital Expenditures...........................................................47
Section 8.13. Indebtedness for Borrowed Money................................................47
Section 8.14. Liens..........................................................................48
Section 8.15. Investments, Acquisitions, Loans, Advances and
Guaranties.....................................................................49
Section 8.16. Mergers, Consolidations and Sales..............................................51
Section 8.17. Maintenance of Subsidiaries....................................................52
Section 8.18. Dividends and Certain Other Restricted Payments................................52
Section 8.19. ERISA..........................................................................52
Section 8.20. Compliance with Laws...........................................................52
Section 8.21. Burdensome Contracts With Affiliates...........................................52
Section 8.22. No Changes in Fiscal Year......................................................53
Section 8.23. Formation of Subsidiaries......................................................53
Section 8.24. Change in the Nature of Business...............................................53
Section 8.25. Change in Capital Structure....................................................53
Section 8.26. Use of Loan Proceeds...........................................................53
Section 8.27. Restrictions on Subsidiary Distributions.......................................53
Section 8.28. Limits on Certain Non-Material Subsidiaries....................................53
Section 8.29. Interest Rate Protection.......................................................54
Section 8.30. Year 2000 Compliance...........................................................54
Section 8.31. Total Funded Debt to Total Capitalization......................................55
Section 8.32. Practice Base..................................................................55
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.....................................................55
Section 9.1. Events of Default..............................................................55
Section 9.2. Non-Bankruptcy Defaults........................................................57
Section 9.3. Bankruptcy Defaults............................................................58
Section 9.4. Collateral for Undrawn Letters of Credit.......................................58
Section 9.5. Notice of Default..............................................................58
Section 9.6. Expenses.......................................................................59
SECTION 10. CHANGE IN CIRCUMSTANCES............................................................59
Section 10.1. Change of Law..................................................................59
Section 10.2. Unavailability of Deposits or Inability to Ascertain,
or Inadequacy of, LIBOR........................................................59
Section 10.3. Increased Cost and Reduced Return..............................................59
Section 10.4. Lending Offices................................................................61
Section 10.5. Discretion of Bank as to Manner of Funding.....................................61
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SECTION 11. THE AGENT..........................................................................61
Section 11.1. Appointment and Authorization of Agent.........................................61
Section 11.2. Agent and its Affiliates.......................................................61
Section 11.3. Action by Agent................................................................62
Section 11.4. Consultation with Experts......................................................62
Section 11.5. Liability of Agent; Credit Decision............................................62
Section 11.6. Indemnity......................................................................63
Section 11.7. Resignation of Agent and Successor Agent.......................................63
SECTION 12. MISCELLANEOUS......................................................................64
Section 12.1. Withholding Taxes..............................................................64
Section 12.2. No Waiver, Cumulative Remedies.................................................65
Section 12.3. Non-Business Days..............................................................65
Section 12.4. Documentary Taxes..............................................................65
Section 12.5. Survival of Representations....................................................65
Section 12.6. Survival of Indemnities........................................................65
Section 12.7. Sharing of Set-Off.............................................................65
Section 12.8. Notices........................................................................66
Section 12.9. Counterparts...................................................................67
Section 12.10. Successors and Assigns.........................................................67
Section 12.11. Participants...................................................................67
Section 12.12. Assignment of Commitments by Banks.............................................67
Section 12.13. Amendments.....................................................................68
Section 12.14. Headings.......................................................................68
Section 12.15. Costs and Expenses.............................................................68
Section 12.16. Set-off........................................................................69
Section 12.17. Entire Agreement...............................................................69
Section 12.18. Governing Law..................................................................69
Section 12.19. Severability of Provisions.....................................................69
Section 12.20. Excess Interest................................................................69
Section 12.21. Confidentiality................................................................70
Section 12.22. Single Bank....................................................................70
Section 12.23. Reaffirmation of Collateral Documents..........................................70
Section 12.24 Equalization of Outstanding Loans..............................................71
Section 12.25. Submission to Jurisdiction; Waiver of Jury Trial...............................71
Signature Page...........................................................................................72
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EXHIBIT A - Notice of Payment Request
EXHIBIT B - Request for New Borrowing
EXHIBIT C - Rollover/Repayment Request
EXHIBIT D - Revolving Note
EXHIBIT E - Term A Note
EXHIBIT F - Term B Note
EXHIBIT G - Notice of Repayment
EXHIBIT H - Compliance Certificate
EXHIBIT I - Assignment and Acceptance
SCHEDULE 6.2 - Subsidiaries
SCHEDULE 6.7 - Additional Disclosures
SCHEDULE 6.12 - Taxes
SCHEDULE 8.13 - Existing Indebtedness
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AMENDED AND RESTATED CREDIT AGREEMENT
To each of the Banks signatory hereto
Ladies and Gentlemen:
The undersigned, Vision Twenty-One, Inc., a Florida corporation (the
"Borrower"), refers to that certain Credit Agreement dated as of January 30,
1998, as amended, among the Borrower, the several financial institutions parties
thereto, and Bank of Montreal, as agent (herein, the "Original Credit
Agreement"). The Borrower has requested that the aggregate commitments available
under the Original Credit Agreement be increased, that certain additional
amendments be made to the Original Credit Agreement and, for the sake of clarity
and convenience, that the Original Credit Agreement be restated in its entirety
as so amended. This Agreement amends and replaces the Original Credit Agreement
in its entirety and, from and after the date hereof, all references made to the
Original Credit Agreement in any Loan Document or in any other instrument or
document shall, without more, be deemed to refer to this Agreement. This
Agreement shall become effective as of the date hereof, and supersedes all
provisions of the Original Credit Agreement as of such date, upon the execution
of this Agreement by each of the parties hereto and fulfillment of the
conditions precedent contained in Section 7.1 hereof. Each of you is hereinafter
referred to as a "Bank," all of you are hereinafter referred to collectively as
the "Banks," and Bank of Montreal in its capacity as agent for the Banks
hereunder is hereinafter referred to as the "Agent." All capitalized terms used
herein without definition shall have the same meanings herein as such terms are
defined in Section 5 hereof.
NOW, THEREFORE, in consideration of the mutual agreements contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. THE CREDIT FACILITIES.
Section 1.1. Revolving Credit Commitments. Subject to the terms and
conditions hereof, each Bank, by its acceptance hereof, severally agrees to make
a loan or loans (individually a "Revolving Loan" and collectively the "Revolving
Loans") to the Borrower from time to time on a revolving basis up to the amount
of such Bank's revolving credit commitment set forth on the applicable signature
page hereof or pursuant to Section 12.12 hereof (its "Revolving Credit
Commitment" and, cumulatively for all the Banks, the "Revolving Credit
Commitments"), subject to any reductions thereof pursuant to the terms hereof,
before the Revolving Credit Termination Date. The sum of the aggregate principal
amount of Revolving Loans and of L/C Obligations at any time outstanding shall
not exceed the Revolving Credit Commitments in effect at such time. Each
Borrowing of Revolving Loans shall be made ratably
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from the Banks in proportion to their respective Revolver Percentages. As
provided in Section 1.6(a) hereof, the Borrower may elect that each Borrowing of
Revolving Loans be either Base Rate Loans or Eurodollar Loans. Revolving Loans
may be repaid and the principal amount thereof reborrowed before the Revolving
Credit Termination Date, subject to the terms and conditions hereof.
Section 1.2. Letters of Credit. (a) General Terms. Subject to the terms
and conditions hereof, as part of the Revolving Credit, the Agent shall issue
standby letters of credit (each a "Letter of Credit") for the Borrower's account
in an aggregate undrawn face amount up to the amount of the L/C Commitment,
provided that the aggregate L/C Obligations at any time outstanding shall not
exceed the difference between the Revolving Credit Commitments in effect at such
time and the aggregate principal amount of Revolving Loans then outstanding.
Each Letter of Credit shall be issued by the Agent, but each Bank shall be
obligated to reimburse the Agent for such Bank's Revolver Percentage of the
amount of each drawing thereunder and, accordingly, each Letter of Credit shall
constitute usage of the Revolving Credit Commitment of each Bank pro rata in an
amount equal to its Revolver Percentage of the L/C Obligations then outstanding.
(b) Applications. At any time before the Revolving Credit Termination
Date, the Agent shall, at the request of the Borrower, issue one or more Letters
of Credit, in a form satisfactory to the Agent, with expiration dates no later
than the earlier of 12 months from the date of issuance (or be cancelable not
later than 12 months from the date of issuance and each renewal) or Revolving
Credit Termination Date, in an aggregate face amount as set forth above, upon
the receipt of an application duly executed by the Borrower for the relevant
Letter of Credit in the form then customarily prescribed by the Agent for the
Letter of Credit requested (each an "Application"). Notwithstanding anything
contained in any Application to the contrary: (i) the Borrower shall pay fees in
connection with each Letter of Credit as set forth in Section 2.1 hereof, (ii)
except as otherwise provided in Section 1.9 hereof, before the occurrence of a
Default or an Event of Default, the Agent will not call for the funding by the
Borrower of any amount under a Letter of Credit before being presented with a
drawing thereunder, and (iii) if the Agent is not timely reimbursed for the
amount of any drawing under a Letter of Credit on the date such drawing is paid,
the Borrower's obligation to reimburse the Agent for the amount of such drawing
shall bear interest (which the Borrower hereby promises to pay) from and after
the date such drawing is paid at a rate per annum equal to the sum of 2% plus
the Applicable Margin plus the Base Rate from time to time in effect. If the
Agent issues any Letter of Credit with an expiration date that is automatically
extended unless the Agent gives notice that the expiration date will not so
extend beyond its then scheduled expiration date, the Agent will give such
notice of non-renewal before the time necessary to prevent such automatic
extension if before such required notice date: (i) the expiration date of such
Letter of Credit if so extended would be after the Revolving Credit Termination
Date, (ii) the Revolving Credit Commitments have been
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terminated, or (iii) a Default or an Event of Default exists and the Required
Banks have given the Agent instructions not to so permit the extension of the
expiration date of such Letter of Credit. The Agent agrees to issue amendments
to the Letter(s) of Credit increasing the amount, or extending the expiration
date, thereof at the request of the Borrower subject to the conditions of
Section 7.2 hereof and the other terms of this Section 1.2.
(c) The Reimbursement Obligations. Subject to Section 1.2(b) hereof, the
obligation of the Borrower to reimburse the Agent for all drawings under a
Letter of Credit (a "Reimbursement Obligation") shall be governed by the
Application related to such Letter of Credit, except that reimbursement shall be
made by no later than 12:00 Noon (Chicago time) on the date when each drawing is
paid in immediately available funds at the Agent's principal office in Chicago,
Illinois. If the Borrower does not make any such reimbursement payment on the
date due and the Participating Banks fund their participations therein in the
manner set forth in Section 1.2(d) below, then all payments thereafter received
by the Agent in discharge of any of the relevant Reimbursement Obligations shall
be distributed in accordance with Section 1.2(d) below.
(d) The Participating Interests. Each Bank (other than the Bank then
acting as Agent in issuing Letters of Credit), by its acceptance hereof,
severally agrees to purchase from the Agent, and the Agent hereby agrees to sell
to each such Bank (a "Participating Bank"), an undivided percentage
participating interest (a "Participating Interest"), to the extent of its
Revolver Percentage, in each Letter of Credit issued by, and each Reimbursement
Obligation owed to, the Agent. Upon any failure by the Borrower to pay any
Reimbursement Obligation at the time required on the date the related drawing is
paid, as set forth in Section 1.2(c) above, or if the Agent is required at any
time to return to the Borrower or to a trustee, receiver, liquidator, custodian,
or other Person any portion of any payment of any Reimbursement Obligation, each
Participating Bank shall, not later than the Business Day it receives a
certificate in the form of Exhibit A hereto from the Agent to such effect, if
such certificate is received before 1:00 p.m. (Chicago time), or not later than
1:00 p.m. (Chicago time) the following Business Day, if such certificate is
received after such time, pay to the Agent an amount equal to such Participating
Bank's Revolver Percentage of such unpaid or recaptured Reimbursement Obligation
together with interest on such amount accrued from the date the related payment
was made by the Agent to the date of such payment by such Participating Bank at
a rate per annum equal to: (i) from the date the related payment was made by the
Agent to the date 2 Business Days after payment by such Participating Bank is
due hereunder, the Federal Funds Rate for each such day and (ii) from the date 2
Business Days after the date such payment is due from such Participating Bank to
the date such payment is made by such Participating Bank, the Base Rate in
effect for each such day. Each such Participating Bank shall thereafter be
entitled to receive its Revolver Percentage of each payment received in respect
of the relevant Reimbursement Obligation and of interest paid thereon, with the
Agent retaining its Revolver Percentage as a Bank hereunder.
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The several obligations of the Participating Banks to the Agent under
this Section 1.2 shall be absolute, irrevocable, and unconditional under any and
all circumstances whatsoever and shall not be subject to any set-off,
counterclaim or defense to payment which any Participating Bank may have or have
had against the Borrower, the Agent, any other Bank, or any other Person
whatsoever. Without limiting the generality of the foregoing, such obligations
shall not be affected by any Default or Event of Default or by any reduction or
termination of any Commitment of any Bank, and each payment by a Participating
Bank under this Section 1.2 shall be made without any offset, abatement,
withholding, or reduction whatsoever. The Agent shall be entitled to offset
amounts received for the account of a Bank under this Agreement against unpaid
amounts due from such Bank to the Agent hereunder (whether as fundings of
participations, indemnities, or otherwise), but shall not be entitled to offset
against amounts owed to the Agent by any Bank arising outside of this Agreement.
(e) Indemnification. The Participating Banks shall, to the extent of
their respective Revolver Percentages, indemnify the Agent (to the extent not
reimbursed by the Borrower) against any cost, expense (including reasonable
counsel fees and disbursements), claim, demand, action, loss, or liability
(except such as result from the Agent's gross negligence or willful misconduct)
that the Agent may suffer or incur in connection with any Letter of Credit. The
obligations of the Participating Banks under this Section 1.2(e) and all other
parts of this Section 1.2 shall survive termination of this Agreement and of all
Applications, Letters of Credit, and all drafts and other documents presented in
connection with drawings thereunder.
Section 1.3. Term Credit Commitments. (a) Subject to the terms and
conditions hereof, each Bank, by its acceptance hereof, severally agrees to make
one or more loans (individually a "Term A Loan" and collectively the "Term A
Loans") to the Borrower from time to time in the aggregate amount of such Bank's
commitment to make Term A Credit as set forth on the applicable signature page
hereof or pursuant to Section 12.12 hereof (its "Term A Credit Commitment" and,
cumulatively for all the Banks, the "Term A Credit Commitments"), subject to any
reduction thereof pursuant to the terms hereof, on or before the Term A Credit
Commitment Termination Date (at which time the Term A Credit Commitments of the
Banks shall expire). Each Borrowing of Term A Loans shall be made ratably by the
Banks in proportion to their respective Term A Loan Percentages. Each Borrowing
of Term A Loans shall be used solely for the purposes provided in Section 6.4
hereof. Each Borrowing of Term A Loans shall be in an amount of $1,000,000 or
such greater amount which is an integral multiple of $100,000. As provided in
Section 1.6(a) hereof, the Borrower may elect that each Borrowing of Term A
Loans be either Base Rate Loans or Eurodollar Loans. The principal amount of
each Term A Loan made by a Bank to the Borrower shall permanently reduce the
amount available to the Borrower under such Bank's Term A Credit Commitment, and
no amount repaid or prepaid on any Term A Loan may be borrowed again.
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(b) Subject to the terms and conditions hereof, each Bank, by its
acceptance hereof, severally agrees to make one or more loans (individually a
"Term B Loan" and collectively the "Term B Loans") to the Borrower from time to
time in the aggregate amount of such Bank's commitment to make Term B Loans as
set forth on the applicable signature page hereof or pursuant to Section 12.12
hereof (its "Term B Credit Commitment" and, cumulatively for all the Banks, the
"Term B Credit Commitments"), subject to any reduction thereof pursuant to the
terms hereof, on or before the Term B Credit Commitment Termination Date (at
which time the Term B Credit Commitments of the Banks shall expire). There shall
be no more than 2 advances of Term B Loans made under the Term B Credit
Commitments, and any part of the Term B Credit Commitments not requested on the
date of the second advance hereunder shall thereupon terminate. Each Borrowing
of Term B Loans shall be made ratably by the Banks in proportion to their
respective Term B Loan Percentages. Each Borrowing of Term B Loans shall be used
solely for the purposes provided in Section 6.4 hereof. Each Borrowing of Term B
Loans shall be in an amount of $1,000,000 or such greater amount which is an
integral multiple of $100,000. As provided in Section 1.6(a) hereof, the
Borrower may elect that each Borrowing of Term B Loans be either Base Rate
Loans, Eurodollar Loans, or Fixed Rate Loans. The principal amount of each Term
B Loan made by a Bank to the Borrower shall permanently reduce the amount
available to the Borrower under such Bank's Term B Credit Commitment, and no
amount repaid or prepaid on any Term B Loan may be borrowed again.
Section 1.4. Applicable Interest Rates. (a) Base Rate Loans. Each Base
Rate Loan made or maintained by a Bank shall bear interest during each Interest
Period it is outstanding (computed on the basis of a year of 365 or 366 days, as
the case may be, and actual days elapsed, except that determinations made under
clause (ii) of the definition of Base Rate set forth below shall be computed on
the basis of a year of 360 days and actual days elapsed) on the unpaid principal
amount thereof from the date such Loan is advanced, continued or created by
conversion from a Eurodollar Loan until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Margin plus
the Base Rate from time to time in effect, payable on the last day of its
Interest Period and at maturity (whether by acceleration or otherwise).
"Base Rate" means for any day the greater of: (i) the rate of interest
announced by the Agent from time to time as its prime commercial rate, or
equivalent, for U.S. Dollar loans to borrowers located in the United States with
any change in the Base Rate resulting from a change in said prime commercial
rate to be effective as of the date of the relevant change in said prime
commercial rate (it being acknowledged and agreed that such rate may not be the
Agent's best or lowest rate); and (ii) the sum of (x) the rate for that day set
forth opposite the caption "Federal Fund (Effective)" in the daily statistical
release designated as "Composite 3:30 P.M. Quotations for U.S. Government
Securities," or any successor publication, published by the Federal Reserve Bank
of New York or, if such publication shall be suspended or terminated, the rate
determined
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by the Agent (based on quotations received from two or more Federal funds
dealers of recognized standing) to be the prevailing rate per annum (rounded
upward, if necessary, to the nearest 1/100 of 1%) at approximately 10:00 a.m.
(Chicago time) (or as soon thereafter as is practicable) on such day for the
purchase at face value of overnight Federal funds in an amount approximately
equal to the principal amount owed to the Agent for which such rate is being
determined, plus (y) 1/2 of 1%.
(b) Eurodollar Loans. Each Eurodollar Loan made or maintained by a Bank
shall bear interest during each Interest Period it is outstanding (computed on
the basis of a year of 360 days and actual days elapsed) on the unpaid principal
amount thereof from the date such Loan is advanced, continued, or created by
conversion from a Base Rate Loan until maturity (whether by acceleration or
otherwise) at a rate per annum equal to the sum of the Applicable Margin plus
the Adjusted LIBOR applicable for such Interest Period, payable on the last day
of the Interest Period and at maturity (whether by acceleration or otherwise),
and, if the applicable Interest Period is longer than three months, on each day
occurring every three months after the commencement of such Interest Period.
"Adjusted LIBOR" means, for any Borrowing of Eurodollar Loans, a rate
per annum determined in accordance with the following formula:
Adjusted LIBOR = LIBOR
---------------------------------
1 - Eurodollar Reserve Percentage
"LIBOR" means, for an Interest Period for a Borrowing of Eurodollar
Loans, (a) the LIBOR Index Rate for such Interest Period, if such rate is
available, and (b) if the LIBOR Index Rate cannot be determined, the arithmetic
average of the rates of interest per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) at which deposits in U.S. Dollars in immediately
available funds are offered to the Agent at 11:00 a.m. (London, England time) 2
Business Days before the beginning of such Interest Period by 3 or more major
banks in the interbank eurodollar market selected by the Agent for delivery on
the first day of and for a period equal to such Interest Period and in an amount
equal or comparable to the principal amount of the Eurodollar Loan scheduled to
be made by the Agent as part of such Borrowing.
"LIBOR Index Rate" means, for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next higher one hundred-thousandth of a
percentage point) for deposits in U.S. Dollars for a period equal to such
Interest Period, which appears on the Telerate Page 3750 as of 11:00 a.m.
(London, England time) on the day 2 Business Days before the commencement of
such Interest Period.
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"Telerate Page 3750" means the display designated as "Page 3750" on the
Dow ▇▇▇▇▇ Telerate Service (or such other page as may replace Page 3750 on that
service or such other service as may be nominated by the British Bankers'
Association as the information vendor for the purpose of displaying British
Bankers' Association Interest Settlement Rates for U.S. Dollar deposits).
"Eurodollar Reserve Percentage" means, for any Borrowing of Eurodollar
Loans, the daily average for the applicable Interest Period of the maximum rate,
expressed as a decimal, at which reserves (including, without limitation, any
supplemental, marginal, and emergency reserves) are imposed during such Interest
Period by the Board of Governors of the Federal Reserve System (or any
successor) on "eurocurrency liabilities", as defined in such Board's Regulation
D (or in respect of any other category of liabilities that includes deposits by
reference to which the interest rate on Eurodollar Loans is determined or any
category of extensions of credit or other assets that include loans by
non-United States offices of any Bank to United States residents), subject to
any amendments of such reserve requirement by such Board or its successor,
taking into account any transitional adjustments thereto. For purposes of this
definition, the Eurodollar Loans shall be deemed to be "eurocurrency
liabilities" as defined in Regulation D without benefit or credit for any
prorations, exemptions or offsets under Regulation D.
(c) Fixed Rate Loans. Each Fixed Rate Loan made or maintained by a Bank
shall bear interest (computed on the basis of a year of 360 days and the actual
days elapsed) on the unpaid principal amount thereof from the date such Loan is
advanced or created by conversion from a Base Rate Loan or Eurodollar Loan until
maturity (whether by acceleration or otherwise) at a rate per annum equal to the
sum of the Applicable Margin with respect to Eurodollar Loans as from time to
time in effect plus the Adjusted Fixed Rate applicable to the relevant Borrowing
of Term B Loans, payable on the last day of each March, June, September, and
December occurring after the relevant Borrowing of Fixed Rate Loans is advanced
or created and at maturity (whether by acceleration or otherwise). Fixed Rate
Loans shall only be available for Borrowings of Term B Loans. In the event the
Borrower elects that a Borrowing of Term B Loans constitute Fixed Rate Loans,
such election shall be irrevocable and remain in effect with respect to such
Borrowing of Term B Loans from the date such Fixed Rate Loans are advanced or
created by conversion from a Base Rate Loan or Eurodollar Loan through the final
maturity date of the Term B Loans.
"Adjusted Fixed Rate" means, for any Borrowing of Fixed Rate Loans, a
rate per annum determined in accordance with the following formula:
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Adjusted Fixed Rate = Fixed Rate + (Adjusted
LIBOR-LIBOR, as determined by the Floating Rate
Payor pursuant to clause (d) below)
"Floating Rate Payor" means Bank of Montreal, in its capacity as a
payment obligor under Section 1.4(d) below.
"Fixed Rate" means, with respect to a Borrowing of Fixed Rate Loans
advanced or created by conversion from a Base Rate Loan or Eurodollar Loan on
the same day, the rate per annum quoted to the Borrower by the Floating Rate
Payor on the date on which such Borrowing is to be advanced or created, it being
acknowledged and agreed that the Fixed Rate shall be established at the time of
each Borrowing of Term B Loans by the Floating Rate Payor in its sole
discretion.
(d) Floating Rate Payor Obligation. Subject to receipt by the Agent of
payment in full of interest due by the Borrower with respect to each Borrowing
of Fixed Rate Loans, the Agent will remit to the Floating Rate Payor the
interest so paid by the Borrower and the Floating Rate Payor shall pay to the
Agent for distribution to the Banks ratably an amount equal to interest which
would have accrued on such Borrowing during the prior 3-month period at a rate
per annum equal to the sum of the Applicable Margin with respect to Eurodollar
Loans in effect during such period plus the Adjusted LIBOR (computed on the
basis of a year of 360 days and the actual number of days elapsed) (as
determined by the Floating Rate Payor on the first day of the relevant calendar
quarter and determined as if the relevant Interest Period was 3 months, provided
during the first three months following the date hereof such rate shall be
determined on the first day of each month and determined as if the relevant
Interest Period was 1 month). In the event any such Fixed Rate Loans bear
interest at the default rate provided for in Section 1.10(c) hereof, the Banks
shall also be entitled to receive from the Floating Rate Payor their pro rata
share thereof, based on their Percentages of the relevant Borrowing of Term B
Loans, to the extent paid by the Borrower. In the event interest on any such
Fixed Rate Loan is not paid, either in whole or in part, by the Borrower, then
the Floating Rate Payor shall be obligated to pay to the Agent for distribution
to the Banks an amount determined by multiplying the amounts due the Banks as
set forth above times a fraction, the numerator of which is the amount of
interest actually paid by the Borrower to the Agent and the denominator of which
is the amount of interest due from Borrower with respect to such Fixed Rate
Loans.
(e) Rate Determinations. The Agent shall determine each interest rate
applicable to the Loans (other than Fixed Rate Loans) and the Reimbursement
Obligations hereunder, and its determination thereof shall be conclusive and
binding except in the case of manifest error. The Floating Rate Payor shall
determine each interest rate applicable to the Fixed Rate Loans, and its
determination thereof shall be conclusive and binding except in the case of
manifest error.
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Section 1.5. Minimum Borrowing Amounts. Each Borrowing of Base Rate
Loans advanced under a Credit shall be in an amount not less than $100,000. Each
Borrowing of Eurodollar Loans advanced, continued, or converted under a Credit
shall be in an amount equal to $1,000,000 or such greater amount which is an
integral multiple of $500,000. Each Borrowing of Fixed Rate Loans advanced or
created by conversion under the relevant Term Credit shall be in an amount equal
to $1,000,000 or such greater amount which is an integral multiple of $500,000.
Section 1.6. Manner of Borrowing Loans and Designating Applicable
Interest Rates. (a) Notice to the Agent. The Borrower shall give notice to the
Agent by no later than 10:00 a.m. (Chicago time): (i) at least 3 Business Days
before the date on which the Borrower requests the Banks to advance a Borrowing
of Eurodollar Loans, (ii) at least 3 Business Days before the date on which the
Borrower requests the Banks to advance a Borrowing of Term B Loans which are
Fixed Rate Loans, and (iii) on the date the Borrower requests the Banks to
advance a Borrowing of Base Rate Loans. The Loans included in each Borrowing
shall bear interest initially at the type of rate specified in such notice of a
new Borrowing. Thereafter, except with respect to Fixed Rate Loans, the Borrower
may from time to time elect to change or continue the type of interest rate
borne by each Borrowing or, subject to Section 1.5's minimum amount requirement
for each outstanding Borrowing, a portion thereof, as follows: (i) if such
Borrowing is of Eurodollar Loans, on the last day of the Interest Period
applicable thereto, the Borrower may continue part or all of such Borrowing as
Eurodollar Loans or convert part or all of such Borrowing into Base Rate Loans
or, with respect to any Borrowing of Term B Loans, into Fixed Rate Loans or (ii)
if such Borrowing is of Base Rate Loans, on any Business Day, the Borrower may
convert all or part of such Borrowing into Eurodollar Loans for an Interest
Period or Interest Periods specified by the Borrower or, with respect to any
Borrowing of Term B Loans, into Fixed Rate Loans. The Borrower shall give all
such notices requesting the advance, continuation, or conversion of a Borrowing
to the Agent by telephone or telecopy (which notice shall be irrevocable once
given and, if by telephone, shall be promptly confirmed in writing),
substantially in the form attached hereto as Exhibit B (Request for New
Borrowing) or Exhibit C (Rollover/Conversion Request), as applicable, or in such
other form acceptable to the Agent. Notices of the continuation of a Borrowing
of Eurodollar Loans for an additional Interest Period or of the conversion of
part or all of a Borrowing of Eurodollar Loans into Base Rate Loans or Fixed
Rate Loans or of Base Rate Loans into Eurodollar Loans or Fixed Rate Loans must
be given by no later than 10:00 a.m. (Chicago time) at least 3 Business Days
before the date of the requested continuation or conversion. All such notices
concerning the advance, continuation, or conversion of a Borrowing shall specify
the date of the requested advance, continuation, or conversion of a Borrowing
(which shall be a Business Day), the amount of the requested Borrowing to be
advanced, continued, or converted, the type of Loans to comprise such new,
continued, or converted Borrowing and, if such Borrowing is to be comprised of
Eurodollar Loans, the Interest Period applicable thereto. Notwithstanding
anything to the contrary contained
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herein, unless otherwise agreed by the Floating Rate Payor in its discretion,
(i) the original principal amount of Fixed Rate Loans available hereunder shall
not exceed $35,000,000 in the aggregate, and (ii) all requests for an advance of
Fixed Rate Loans or of the conversion of Base Rate Loans or Eurodollar Loans
into Fixed Rate Loans shall be made, if at all, prior to September 30, 1998, at
which time the Borrower's right to thereafter select new Fixed Rate options for
the Term B Loans shall expire. The Borrower agrees that the Agent may rely on
any such telephonic or telecopy notice given by any person the Agent in good
faith believes is an Authorized Representative without the necessity of
independent investigation, and in the event any such notice by telephone
conflicts with any written confirmation, such telephonic notice shall govern if
the Agent has acted in reliance thereon.
(b) Notice to the Banks. The Agent shall give prompt telephonic or
telecopy notice to each Bank of any notice from the Borrower received pursuant
to Section 1.6(a) above and, if such notice requests the Banks to make
Eurodollar Loans, the Agent shall give notice to the Borrower and each Bank by
like means of the interest rate applicable thereto promptly after the Agent has
made such determination.
(c) Borrower's Failure to Notify; Automatic Continuations and
Conversions. Any outstanding Borrowing of Base Rate Loans shall automatically be
continued for an additional Interest Period on the last day of its then current
Interest Period unless the Borrower has notified the Agent within the period
required by Section 1.6(a) that the Borrower intends to convert such Borrowing,
subject to Section 7.2 hereof, into a Borrowing of Eurodollar Loans or, with
respect to a Borrowing of Term B Loans, Fixed Rate Loans or such Borrowing is
prepaid in accordance with Section 1.9(a). If the Borrower fails to give notice
pursuant to Section 1.6(a) above of the continuation or conversion of any
outstanding principal amount of a Borrowing of Eurodollar Loans before the last
day of its then current Interest Period within the period required by Section
1.6(a) or, whether or not such notice has been given, one or more of the
conditions set forth in Section 7.2 for the continuation or conversion of a
Borrowing of Eurodollar Loans would not be satisfied (unless such conditions
have been waived in accordance with the terms of this Agreement), and such
Borrowing is not prepaid in accordance with Section 1.9(a), such Borrowing shall
automatically be converted into a Borrowing of Base Rate Loans.
(d) Disbursement of Loans. Not later than 1:00 p.m. (Chicago time) on
the date of any requested advance of a new Borrowing, subject to Section 7
hereof, each Bank shall make available its Loan comprising part of such
Borrowing in funds immediately available at the principal office of the Agent in
Chicago, Illinois. The Agent shall make the proceeds of each new Borrowing
available to the Borrower at the Agent's principal office in Chicago, Illinois
(or by wire transfer of funds pursuant to the Borrower's written instructions to
the Agent).
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(e) Agent Reliance on Bank Funding. Unless the Agent shall have been
notified by a Bank prior to (or, in the case of a Borrowing of Base Rate Loans,
by 1:00 p.m. Chicago time on) the date on which such Bank is scheduled to make
payment to the Agent of the proceeds of a Loan (which notice shall be effective
upon receipt) that such Bank does not intend to make such payment, the Agent may
assume that such Bank has made such payment when due and the Agent may in
reliance upon such assumption (but shall not be required to) make available to
the Borrower the proceeds of the Loan to be made by such Bank and, if any Bank
has not in fact made such payment to the Agent, such Bank shall, on demand, pay
to the Agent the amount made available to the Borrower attributable to such Bank
together with interest thereon in respect of each day during the period
commencing on the date such amount was made available to the Borrower and ending
on (but excluding) the date such Bank pays such amount to the Agent at a rate
per annum equal to (i) from the date the related advance was made by the Agent
to the date 2 Business Days after payment by such Bank is due hereunder, the
Federal Funds Rate for each such day and (ii) from the date 2 Business Days
after the date such payment is due from such Bank to the date such payment is
made by such Bank, the Base Rate in effect for each such day. If such amount is
not received from such Bank by the Agent immediately upon demand, the Borrower
will, on demand, repay to the Agent the proceeds of the Loan attributable to
such Bank with interest thereon at a rate per annum equal to the interest rate
applicable to the relevant Loan, but without such payment being considered a
payment or prepayment of a Loan under Section 1.12 hereof, so that the Borrower
will have no liability under such Section with respect to such payment.
Section 1.7. Interest Periods. As provided in Section 1.6(a) hereof, at
the time of each request to advance, continue, or create by conversion a
Borrowing of Eurodollar Loans, the Borrower shall select an Interest Period
applicable to such Loans from among the available options. The term "Interest
Period" means the period commencing on the date a Borrowing of Loans is
advanced, continued, or created by conversion and ending: (a) in the case of
Base Rate Loans, on the last day of the calendar quarter in which such Borrowing
is advanced, continued, or created by conversion (or on the last day of the
following calendar quarter if such Loan is advanced, continued or created by
conversion on the last day of a calendar quarter) and (b) in the case of a
Eurodollar Loan, 1, 2, 3, or 6 months thereafter; provided, however, that:
(a) any Interest Period for a Borrowing of Revolving Loans
consisting of Base Rate Loans that otherwise would end after the
Revolving Credit Termination Date shall end on the Revolving Credit
Termination Date, and any Interest Period for a Borrowing of Term A
Loans consisting of Base Rate Loans that otherwise would end after the
final maturity date of the Term A Loans shall end on the final maturity
date of the Term A Loans, and any Interest Period for a Borrowing of
Term B Loans consisting of Base Rate Loans that would otherwise
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end after the final maturity date of the Term B Loans end on the final
maturity date of the Term B Loans;
(b) no Interest Period with respect to any portion of the Term A
Loans shall extend beyond the final maturity date of the Term A Loans,
no Interest Period with respect to any portion of the Term B Loans shall
extend beyond the final maturity date of the Term B Loans, and no
Interest Period with respect to any portion of the Revolving Loans shall
extend beyond the Revolving Credit Termination Date;
(c) no Interest Period with respect to any portion of the Term A
Loans consisting of Eurodollar Loans shall extend beyond a date on which
the Borrower is required to make a scheduled payment of principal on the
Term A Loans, unless the sum of (i) the aggregate principal amount of
Term A Loans that are Base Rate Loans plus (ii) the aggregate principal
amount of Term A Loans that are Eurodollar Loans with Interest Periods
expiring on or before such date, equals or exceeds the principal amount
to be paid on the Term A Loans on such payment date;
(d) no Interest Period with respect to any portion of the Term B
Loans consisting of Eurodollar Loans shall extend beyond a date on which
the Borrower is required to make a scheduled payment of principal on the
Term B Loans, unless the sum of (i) the aggregate principal amount of
Term B Loans that are Base Rate Loans plus (ii) the aggregate principal
amount of Term B Loans that are Eurodollar Loans with Interest Periods
expiring on or before such date plus (iii) the aggregate principal
amount of Term B Loans that are Fixed Rate Loans scheduled to mature on
or before such date equals or exceeds the principal amount to be paid on
the Term B Loans on such payment date;
(e) whenever the last day of any Interest Period would otherwise
be a day that is not a Business Day, the last day of such Interest
Period shall be extended to the next succeeding Business Day, provided
that, if such extension would cause the last day of an Interest Period
for a Borrowing of Eurodollar Loans to occur in the following calendar
month, the last day of such Interest Period shall be the immediately
preceding Business Day; and
(f) for purposes of determining an Interest Period for a
Borrowing of Eurodollar Loans, a month means a period starting on one
day in a calendar month and ending on the numerically corresponding day
in the next calendar month; provided, however, that if there is no
numerically corresponding day in the month in which such an Interest
Period is to end or if such an Interest Period begins on the
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last Business Day of a calendar month, then such Interest Period shall
end on the last Business Day of the calendar month in which such
Interest Period is to end.
Section 1.8. Maturity of Loans. (a) Revolving Loans. Each Revolving Loan
shall mature and become due and payable by the Borrower on the Revolving Credit
Termination Date.
(b) Scheduled Payments of Term A Loans. The Borrower shall make
principal payments on the Term A Loans in installments on the last day of each
March, June, September and December in each year, commencing with the calendar
quarter ending September 30, 1999, with the amount of each such installment to
equal 6.25% of the original aggregate principal amount of the Term A Loans made
to the Borrower on or prior to the Term A Credit Commitment Termination Date,
except that the final payment of both principal and interest not sooner paid on
the Term A Loans shall be due and payable on the Term A Credit Final Maturity
Date. Each such principal payment shall be applied to the Banks holding the Term
A Notes pro rata based on their Term A Loan Percentages.
(c) Scheduled Payments of Term B Loans. The Borrower shall make
principal payments on the Term B Loans in installments on the last day of each
June in each year, commencing June 30, 1999, with the amount of each such
installment to equal 1.0% of the original aggregate principal amount of the Term
B Loans made to the Borrower on or prior to the Term B Credit Commitment
Termination Date (with each such installment deemed to reduce each Fixed Rate
Loan then outstanding by an amount equal to 1.0% of the original principal
amount thereof), except that the final payment of both principal and interest
not sooner paid on the Term B Loans shall be due and payable on the Term B
Credit Final Maturity Date. Each such principal payment shall be applied to the
Banks holding the Term B Notes pro rata based upon their Term B Loan
Percentages.
Section 1.9. Prepayments. (a) Optional. The Borrower shall have the
privilege of prepaying without premium or penalty and in whole or in part (but,
if in part, then: (i) if such Borrowing is of Base Rate Loans, in an amount not
less than $100,000, (ii) if such Borrowing is of Eurodollar Loans or Fixed Rate
Loans, in an amount not less than $500,000, and (iii) in each case, in an amount
such that the minimum amount required for a Borrowing pursuant to Section 1.5
hereof remains outstanding) any Borrowing of Eurodollar Loans or Fixed Rate
Loans at any time upon 3 Business Days prior notice to the Agent or, in the case
of a Borrowing of Base Rate Loans, notice delivered to the Agent by the Borrower
no later than 10:00 a.m. (Chicago time) on the date of prepayment (such notice
to be in substantially the form attached hereto as Exhibit G (Notice of
Repayment) or in such other form acceptable to the Agent), such prepayment to be
made by the payment of the principal amount to be prepaid and, in the case of
any Eurodollar Loan or Fixed Rate Loan, accrued interest thereon to the date
fixed for prepayment plus any amounts due the Banks under Section 1.12 hereof.
The Agent will
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promptly advise each Bank of any such prepayment notice it receives from the
Borrower. Any amount of Revolving Loans paid or prepaid before the Revolving
Credit Termination Date may, subject to the terms and conditions of this
Agreement, be borrowed, repaid and borrowed again. No amount of the Term A Loans
or Term B Loans paid or prepaid may be reborrowed.
(b) Mandatory. (i) The Borrower shall, on each date the Revolving Credit
Commitments are reduced pursuant to Section 1.13 hereof, prepay the Revolving
Loans and, if necessary, prefund the L/C Obligations by the amount, if any,
necessary to reduce the sum of the aggregate principal amount of Revolving Loans
and of L/C Obligations then outstanding to the amount to which the Revolving
Credit Commitments have been so reduced.
(ii) If after the date of this Agreement the Borrower or any Subsidiary
shall issue any Indebtedness for Borrowed Money, other than Indebtedness for
Borrowed Money permitted by Section 8.13 hereof, the Borrower shall promptly
notify the Agent of the net cash proceeds (i.e., gross proceeds of cash or cash
equivalents minus the costs directly incurred and payable as a result thereof)
of such issuance to be received by or for the account of the Borrower or such
Subsidiary in respect thereof. Promptly upon, and in no event later than the
Business Day after, receipt by the Borrower or such Subsidiary of net cash
proceeds of such issuance, the Borrower shall prepay the Term Loans in an
aggregate amount equal to 100% of the amount of such net cash proceeds. The
amount of such prepayment shall be applied on a ratable basis among the then
outstanding Term A Loans and Term B Loans, and on a ratable basis among all
remaining payments on such Term A Loans and Term B Loans. The Borrower
acknowledges that its performance hereunder shall not limit the rights and
remedies of the Banks arising from any breach of Section 8.13 hereof.
(iii) Unless the Borrower otherwise directs, prepayments of Loans under
this Section 1.9(b) shall be applied first to Borrowings of Base Rate Loans
until payment in full thereof with any balance applied to Borrowings of
Eurodollar Loans in the order in which their Interest Periods expire and
thereafter, in the case of the Term B Loans, with any balance applied to the
Fixed Rate Loans. Each prepayment of Loans under this Section 1.9(b) shall be
made by the payment of the principal amount to be prepaid and accrued interest
thereon to the date of prepayment together with any amounts due the Banks under
Section 1.12 hereof. Each prefunding of L/C Obligations shall be made in
accordance with Section 9.4 hereof.
Section 1.10. Default Rate. Notwithstanding anything to the contrary
contained in Section 1.4 hereof, while any Event of Default exists or after
acceleration, the Borrower shall pay interest (after as well as before entry of
judgment thereon to the extent permitted by law) on the principal amount of all
Loans (computed on the basis of a year of 360 days and actual days elapsed) at a
rate per annum equal to:
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(a) for any Base Rate Loan, the sum of 2% plus the Applicable
Margin plus the Base Rate from time to time in effect;
(b) for any Eurodollar Loan, the sum of 2% plus the rate of
interest in effect thereon at the time of such default until the end of
the Interest Period applicable thereto and, thereafter, at a rate per
annum equal to the sum of 2% plus the Applicable Margin for Base Rate
Loans plus the Base Rate from time to time in effect; and
(c) for any Fixed Rate Loan, the sum of 2% plus the interest in
effect thereon at the time of such default;
provided, however, that (i) in the event any Fixed Rate Loan, or portion
thereof, is not paid when due, the overdue amount thereof shall bear interest at
the rate per annum equal to the rate per annum applicable to Base Rate Loans
hereunder after default and (ii) in the absence of acceleration, any other
adjustments pursuant to this Section 1.10 shall be made at the election of the
Required Banks with written notice to the Borrower. While any Event of Default
exists or after acceleration, interest shall be paid on demand of the Agent at
the request or with the consent of the Required Banks.
Section 1.11. The Notes. (a) The Revolving Loans made to the Borrower by
a Bank shall be evidenced by a single promissory note of the Borrower issued to
such Bank in the form of Exhibit D hereto. Each such promissory note is
hereinafter referred to as a "Revolving Note" and collectively such promissory
notes are referred to as the "Revolving Notes."
(b) The Term A Loans made to the Borrower by a Bank shall be evidenced
by a single promissory note of the Borrower issued to such Bank in the form of
Exhibit E hereto. Each such promissory note is hereinafter referred to as a
"Term A Note" and collectively such promissory notes are referred to as the
"Term A Notes."
(c) The Term B Loans made to the Borrower by a Bank shall be evidenced
by a single promissory note of the Borrower issued to such Bank in the form of
Exhibit F hereto. Each such promissory note is hereinafter referred to as a
"Term B Note" and collectively such promissory notes are referred to as the
"Term B Notes".
(d) Each Bank shall record on its books and records or on a schedule to
its appropriate Note the amount of each Loan advanced, continued or converted by
it, all payments of principal and interest and the principal balance from time
to time outstanding thereon, the type of such Loan, and, for any Eurodollar
Loan, the Interest Period and, for any Eurodollar Loan and Fixed Rate Loan, the
interest rate applicable thereto. The record thereof, whether shown on such
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books and records of a Bank or on a schedule to the relevant Note, shall be
prima facie evidence as to all such matters; provided, however, that the failure
of any Bank to record any of the foregoing or any error in any such record shall
not limit or otherwise affect the obligation of the Borrower to repay all Loans
made to it hereunder together with accrued interest thereon. At the request of
any Bank and upon such Bank tendering to the Borrower the appropriate Note to be
replaced, the Borrower shall furnish a new Note to such Bank to replace any
outstanding Note, and at such time the first notation appearing on a schedule on
the reverse side of, or attached to, such Note shall set forth the aggregate
unpaid principal amount of all Loans, if any, then outstanding thereon.
Section 1.12. Funding/Hedging Indemnity. If any Bank or the Floating Rate
Payor shall incur any loss, cost or expense (including, without limitation, any
loss of profit, and any loss, cost or expense incurred by reason of the
liquidation or re-employment of deposits or other funds acquired by such Bank or
Floating Rate Payor to fund or maintain any Eurodollar Loan or Fixed Rate Loan
or the relending or reinvesting of such deposits or amounts paid or prepaid to
such Bank or, with respect to any Fixed Rate Loans, by reason of the prepayment
under or termination, in whole or in part, of any interest rate hedging
arrangement entered into by the Floating Rate Payor with respect thereto) as a
result of:
(a) any payment, prepayment or conversion of a Eurodollar Loan on
a date other than the last day of its Interest Period, or any payment or
prepayment of a Fixed Rate Loan, or any part thereof, on a date other
than the regularly scheduled payment date for the originally scheduled
principal payment thereof as provided in Section 1.8(c) hereof,
(b) any failure (because of a failure to meet the conditions of
Section 7 or otherwise) by the Borrower to borrow a Fixed Rate Loan, or
to borrow or continue a Eurodollar Loan, or to convert a Base Rate Loan
into a Eurodollar Loan or Fixed Rate Loan, or to convert a Eurodollar
Loan into a Fixed Rate Loan, on the date specified in a notice given
pursuant to Section 1.6(a),
(c) any failure by the Borrower to make any payment of principal
on any Eurodollar Loan or Fixed Rate Loan when due (whether by
acceleration or otherwise), or
(d) any acceleration of the maturity of a Eurodollar Loan or
Fixed Rate Loan as a result of the occurrence of any Event of Default
hereunder,
then, upon the demand of such Bank or Floating Rate Payor, the Borrower shall
pay to such Bank or Floating Rate Payor such amount as will reimburse such Bank
or Floating Rate Payor
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for such loss, cost or expense. If any Bank or the Floating Rate Payor makes
such a claim for compensation, it shall provide to the Borrower, with a copy to
the Agent, a certificate setting forth the amount of such loss, cost or expense
in reasonable detail (including an explanation of the basis for and the
computation of such loss, cost or expense) and the amounts shown on such
certificate shall be conclusive if reasonably determined.
Section 1.13. Commitment Terminations. (a) Optional Revolving Credit
Terminations. The Borrower shall have the right at any time and from time to
time, upon 3 Business Days prior written notice to the Agent, to terminate the
Revolving Credit Commitments without premium or penalty and in whole or in part,
any partial termination to be (i) in an amount not less than $1,000,000 and (ii)
allocated ratably among the Banks in proportion to their respective Revolver
Percentages, provided that the Revolving Credit Commitments may not be reduced
to an amount less than the sum of the aggregate principal amount of Revolving
Loans and of L/C Obligations then outstanding. Any termination of the Revolving
Credit Commitments below $5,000,000 shall reduce the L/C Commitment by a like
amount. The Agent shall give prompt notice to each Bank of any such termination
of the Revolving Credit Commitments.
(b) Optional Term A Credit Terminations. The Borrower shall have the
right at any time and from time to time, upon 3 Business Days prior written
notice to the Agent, to terminate the Term A Credit Commitments without premium
or penalty and in whole or in part, any partial termination to be (i) in an
amount not less than $1,000,000 and (ii) allocated ratably among the Banks in
proportion the their respective Term A Loan Percentages. The Agent shall give
prompt notice to each Bank of any such termination of the Term A Credit
Commitments.
(c) Optional Term B Credit Terminations. The Borrower shall have the
right at any time and from time to time, upon 3 Business Days prior written
notice to the Agent, to terminate the Term B Credit Commitments without premium
or penalty and in whole or in part, any partial termination to be (i) in an
amount not less than $1,000,000 and (ii) allocated ratably among the Banks in
proportion the their respective Term B Loan Percentages. The Agent shall give
prompt notice to each Bank of any such termination of the Term B Credit
Commitments.
(d) Mandatory Revolving Credit Terminations. If at any time net cash
proceeds remain after the prepayment of the Term Loans in full pursuant to
Section 1.9(b) hereof, the Revolving Credit Commitments shall ratably terminate
by an amount equal to 100% of such excess proceeds (it being expressly
understood and agreed that any such mandatory termination of the Revolving
Credit Commitments hereunder as a result of the foregoing shall be in addition
to any and all other rights and remedies that the Banks may have as a result of
any breach of the terms of Section 8.13 hereof).
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(e) Mandatory Termination Upon a Change of Control. After the occurrence
of a Change of Control, the Required Banks may, by written notice to the
Borrower at any time on or before the date occurring 90 days after the date the
Borrower notifies the Banks of such Change of Control, terminate the remaining
Commitments and all other obligations of the Banks hereunder on the date stated
in such notice (which shall in no event be sooner than 30 days after the
occurrence of such Change of Control). On the date the Commitments are so
terminated, all outstanding Obligations (including, without limitation, all
principal of and accrued interest on the Notes and all amounts owing under
Section 1.12 hereof) shall forthwith be due and payable without further demand,
presentment, protest, or notice of any kind and the Borrower shall immediately
pay to the Banks the full amount then available for drawing under each Letter of
Credit, such amount to be held in the Account referred to in Section 9.4 hereof
(the Borrower agreeing to immediately make such payment on the date the
Commitments are so terminated and acknowledging and agreeing that the Banks
would not have an adequate remedy at law for the failure by the Borrower to
honor any such demand and that the Banks, and the Agent on their behalf, shall
have the right to require the Borrower to specifically perform such undertaking
whether or not any drawings or other demands for payment have been made under
any of the Letters of Credit).
(f) Any termination of the Commitments pursuant to this Section 1.13 may
not be reinstated.
SECTION 2. FEES, EXTENSIONS, AND SUBSTITUTION OF BANKS.
Section 2.1. Fees. (a) Revolving Credit Commitment Fee. The Borrower
shall pay to the Agent for the ratable account of the Banks in accordance with
their Revolver Percentages a commitment fee at the rate per annum equal to the
Applicable Margin (computed on the basis of a year of 360 days and the actual
number of days elapsed) on the average daily Unused Revolving Credit
Commitments. Such commitment fee shall be payable quarter-annually in arrears on
the last day of each March, June, September and December in each year
(commencing September 30, 1998) and on the Revolving Credit Termination Date,
unless the Revolving Credit Commitments are terminated in whole on an earlier
date, in which event the commitment fee for the period to the date of such
termination in whole shall be paid on the date of such termination.
(b) Term A Credit Commitment Fee. The Borrower shall pay to the Agent
for the ratable account of the Banks in accordance with their Term A Loan
Percentages a commitment fee at the rate per annum equal to the Applicable
Margin (computed on the basis of a year of 360 days and the actual number of
days elapsed) on the average daily undrawn Term A Credit Commitments. Such
commitment fee shall be payable quarter-annually in arrears on the last day of
each March, June, September and December in each year (commencing September 30,
1998)
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and on the Term A Credit Commitment Termination Date, unless the Term A Credit
Commitments are terminated in whole on an earlier date, in which event the
commitment fee for the period to the date of such termination in whole shall be
paid on the date of such termination.
(c) Term B Credit Commitment Fee. The Borrower shall pay to the Agent
for the ratable account of the Banks in accordance with their Term B Loan
Percentages a commitment fee at the rate per annum equal to the Applicable
Margin (computed on the basis of a year of 360 days and the actual number of
days elapsed) on the average daily undrawn Term B Credit Commitments. Such
commitment fee shall be payable quarter-annually in arrears on the last day of
each March, June, September and December in each year (commencing September 30,
1998) and on the Term B Credit Commitment Termination Date, unless the Term B
Credit Commitments are terminated in whole on an earlier date, in which event
the commitment fee for the period to the date of such termination in whole shall
be paid on the date of such termination.
(d) Letter of Credit Fees. On the date of issuance or extension, or
increase in the amount, of any Letter of Credit pursuant to Section 1.2 hereof,
the Borrower shall pay to the Agent for its own account an issuance fee equal to
.25% per annum of the face amount of (or of the increase in the face amount of)
such Letter of Credit. Quarterly in arrears, on the last day of each calendar
quarter, commencing on September 30, 1998, the Borrower shall pay to the Agent,
for the ratable benefit of the Banks in accordance with their Revolver
Percentages, a letter of credit fee at a rate per annum equal to the Applicable
Margin (computed on the basis of a year of 360 days and the actual number of
days elapsed) in effect during each day of such quarter applied to the daily
average face amount of Letters of Credit outstanding during such quarter. In
addition, the Borrower shall pay to the Agent for its own account the Agent's
standard drawing, negotiation, amendment, and other administrative fees for each
Letter of Credit. Such standard fees referred to in the preceding sentence may
be established by the Agent from time to time.
(e) Agent Fees. The Borrower shall pay to the Agent for its own use and
benefit the fees agreed to between the Agent and the Borrower in a letter dated
June 5, 1998, or as otherwise from time to time agreed between them in writing.
(f) Audit Fees. The Borrower shall pay to the Agent for its own use and
benefit charges for audits of the Collateral performed by the Agent or its
agents or representatives in such amounts as the Agent may from time to time
request (the Agent acknowledging and agreeing that such charges shall be
computed in the same manner as it at the time customarily uses for the
assessment of charges for similar collateral audit and, in any event, not in
excess of $10,000 for any single audit); provided, however, that in the absence
of any Default and Event of Default, the Borrower shall not be required to pay
the Agent for more than (i) two (2) such audits during the initial 12 months of
this Agreement and (ii) one (1) such audit during each 12 month period ending
thereafter.
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Section 2.2. Extensions of the Revolving Credit Termination Date. No
later than 90 days before the Revolving Credit Termination Date, the Borrower
may make a request for a one year extension of the Revolving Credit Termination
Date in a written notice to the Agent. The Agent will promptly inform the Banks
of any such request, and each Bank shall notify the Agent in writing within 60
days following such request whether such Bank agrees to the requested extension.
If a Bank fails to so notify the Agent whether such Bank agrees to such
extension, such Bank shall be deemed to have refused to grant the requested
extension. Upon receipt by the Agent of the written consent of all the Banks,
the Revolving Credit Termination Date shall be automatically extended an
additional year. Otherwise, the Revolving Credit Termination Date will remain as
scheduled, at which time all Revolving Loans and all other Obligations relating
to the Revolving Credit shall be due and payable. In the event any extension is
granted hereunder, the Borrower shall, and shall cause each Subsidiary to,
execute and deliver such additional instruments and documents as the Agent may
reasonably deem necessary or appropriate to reflect any such extension. All
costs and expenses incurred by the Agent in connection with each extension
request (including reasonable attorneys' fees) shall be paid by the Borrower in
accordance with Section 12.15 hereof.
Section 2.3. Substitution of Banks. Upon the receipt by the Borrower of
(a) a claim from any Bank for compensation under Section 10.3 or 12.1 hereof,
(b) notice by any Bank to the Borrower of any illegality pursuant to Section
10.1 hereof or (c) notice from the Agent that a Bank or Banks have not approved
an extension of the Termination Date pursuant to Section 2.2 hereof, or in the
event any Bank is in default in any material respect with respect to its
obligations under the Loan Documents (herein, a "Defaulting Bank") (any such
Bank referred to in clause (a), (b), or (c) above, or any such Defaulting Bank,
being hereinafter referred to as an "Affected Bank"), the Borrower may, in
addition to any other rights the Borrower may have hereunder or under applicable
law, require, at its expense, any such Affected Bank to assign, at par plus
accrued interest and fees, without recourse, all of its interest, rights and
obligations hereunder (including all of its Commitments and the Loans and
participation interests in Letters of Credit and other amounts at any time owing
to it hereunder and the other Loan Documents) to a bank or other institutional
lender specified by the Borrower, provided that (i) such assignment shall not
conflict with or violate any law, rule, or regulation or order of any court or
other governmental authority, (ii) the Borrower shall have received the written
consent of the Agent, which consent shall not be unreasonably withheld, to such
assignment, (iii) the Borrower shall have paid to the Affected Bank all monies
(together with amounts due such Affected Lender under Section 1.12 hereof as if
such Loans owing to it were prepaid rather than assigned) other than such
principal, interest, and fees accrued and owing to it hereunder, and (iv) the
assignment is entered into in accordance with the other requirements of Section
12.12 hereof.
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SECTION 3. PLACE AND APPLICATION OF PAYMENTS.
All payments of principal of and interest on the Loans and the
Reimbursement Obligations, and of all other Obligations payable by the Borrower
under this Agreement and the other Loan Documents, shall be made by the Borrower
to the Agent by no later than 12:00 Noon (Chicago time) on the due date thereof
at the office of the Agent in Chicago, Illinois (or such other location in the
State of Illinois as the Agent may designate to the Borrower) for the benefit of
the Bank or Banks entitled thereto. Any payments received after such time shall
be deemed to have been received by the Agent on the next Business Day. All such
payments shall be made in U.S. Dollars, in immediately available funds at the
place of payment, in each case without set-off or counterclaim. The Agent will
promptly thereafter cause to be distributed like funds relating to the payment
of principal or interest on Loans and on Reimbursement Obligations in which the
Banks have purchased Participating Interests ratably to the Banks and like funds
relating to the payment of any other amount payable to any Bank to such Bank, in
each case to be applied in accordance with the terms of this Agreement.
Anything contained herein to the contrary notwithstanding, all payments
and collections received in respect of the Obligations and all proceeds of the
Collateral received, in each instance, by the Agent or any of the Banks after
the occurrence and during the continuation of an Event of Default shall be
remitted to the Agent and distributed as follows:
(a) first, to the payment of any outstanding costs and expenses
reasonably incurred by the Agent, and any security trustee therefor, in
monitoring, verifying, protecting, preserving or enforcing the Liens on
the Collateral or by the Agent, and any security trustee therefor, in
protecting, preserving or enforcing rights under the Loan Documents, and
in any event all costs and expenses of a character which the Borrower
has agreed to pay the Agent under Section 12.15 hereof (such funds to be
retained by the Agent for its own account unless it has previously been
reimbursed for such costs and expenses by the Banks, in which event such
amounts shall be remitted to the Banks to reimburse them for payments
theretofore made to the Agent);
(b) second, to the payment of any outstanding interest or other
fees or amounts due under the Notes and the other Loan Documents
(including amounts owing to the Banks or the Floating Rate Payor under
Section 1.12 hereof), in each case other than for principal on the Loans
or in reimbursement or collateralization of L/C Obligations, pro rata as
among the Agent and the Banks in accord with the amount of such interest
and other fees or amounts owing each;
(c) third, to the payment of the principal of the Notes and any
unpaid Reimbursement Obligations and to the Agent to be held as
collateral security for any
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other L/C Obligations (until the Agent is holding an amount of cash
equal to the then outstanding amount of all such L/C Obligations), the
aggregate amount paid to or held as collateral security for the Banks to
be allocated pro rata as among the Banks in accord with the aggregate
unpaid principal balances of their Loans and interests in the Letters of
Credit;
(d) fourth, to the Agent and the Banks ratably in accordance with
the amounts of any other indebtedness, obligations or liabilities of the
Borrower and its Subsidiaries owing to each of them and secured by the
Collateral Documents (other than for Hedging Liability described in
subsection (e) below), unless and until all such indebtedness,
obligations and liabilities have been fully paid and satisfied;
(e) fifth, to the payment of the Hedging Liability (if any) pro
rata as among the Banks to whom such Hedging Liability is owed in
accordance with the then respective unpaid amounts of such liability;
and
(f) sixth, to the Borrower or whoever else may be lawfully
entitled thereto.
SECTION 4. COLLATERAL AND GUARANTIES.
Section 4.1. Collateral. The Obligations shall be secured by (a) valid,
perfected, and enforceable Liens on all right, title, and interest of the
Borrower and each Material Subsidiary in all capital stock or other equity
interests held by such Person in each of its Subsidiaries, whether now owned or
hereafter formed or acquired, and all proceeds thereof, and (b) valid, perfected
(subject to the proviso appearing at the end of this sentence) and enforceable
Liens on all right, title, and interest of the Borrower and each Material
Subsidiary in all accounts and account receivables, notes and note receivables,
contract rights, instruments, documents, chattel paper, general intangibles
(including, without limitation, patents, trademarks, trade names, copyrights,
and other intellectual property rights), investment property, deposit accounts,
inventory, machinery and equipment, and real estate, whether now owned or
hereafter acquired or arising, and all proceeds thereof; provided, however,
that: (i) until the Agent or the Required Banks require otherwise, Liens on real
estate need not be granted and Liens on intellectual property rights need not be
filed with the United States Patent and Trademark Office or the United States
Copyright Office, (ii) the Lien of the Agent on Property subject to a Capital
Lease or conditional sale agreement or subject to a purchase money lien in each
instance permitted hereby shall be subject to the rights of the lessor or lender
thereunder, (iii) until an Event of Default has occurred and is continuing and
thereafter until otherwise required by the Agent or the Required Banks, Liens on
deposit accounts maintained by the Borrower or any Material Subsidiary in
proximity to its operations for the purpose of paying amounts owing (as opposed
to receiving collections of the Collateral as provided in Section 4.2 below),
Liens on note receivables, and Liens on vehicles
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which are subject to a certificate of title law need not be perfected provided
that the total value of such property at any one time not so perfected does not
exceed $500,000 in the aggregate, (iv) until an Event of Default has occurred
and is continuing and thereafter until otherwise required by the Agent or the
Required Banks, no Lien need be granted upon the capital stock of Block Vision
of Texas, Inc. or Vision Insurance Plan of America, Inc., or the partnership
interests in Vision Twenty-One Surgery Center, Ltd. or Vision Twenty-One Surgery
Center-Largo, Ltd. so long as the Borrower is in compliance with Section 8.28
hereof. The Borrower acknowledges and agrees that the Liens on the Collateral
shall be granted to the Agent for the benefit of itself and the Banks and shall
be valid and perfected first priority Liens subject, however, to the proviso
appearing at the end of the immediately preceding sentence, in each case
pursuant to one or more Collateral Documents from such Persons, each in form and
substance satisfactory to the Agent.
Section 4.2 Collections. The Borrower shall maintain all such
arrangements as shall be necessary or appropriate to assure that all proceeds of
the Collateral of the Borrower and its Material Subsidiaries are deposited (in
the same form as received) in accounts maintained with, or under the dominion
and control of, the Agent, such accounts to constitute special restricted
accounts, the Borrower acknowledging that the Agent has (and is hereby granted)
a lien on such accounts and all funds contained therein to secure the
Obligations. If and to the extent that proceeds are deposited in accounts
maintained with financial institutions other than the Agent, it shall be a
condition to the Borrower's or any Material Subsidiary's right to so effect such
deposits more than 30 days after the date hereof that the financial institutions
maintaining such accounts have delivered to the Agent blocked account agreements
satisfactory to the Agent in form and substance pursuant to which such financial
institutions acknowledge the Agent's Lien thereon, waive any right of offset or
bankers' liens thereon (other than with respect to account maintenance charges
and returned items) and agree that the collected balances in such accounts will
only be transferred to the Agent. The Banks agree with the Borrower that if and
so long as no Default or Event of Default has occurred or is continuing, amounts
on deposit in the accounts maintained with the Agent will (subject to the rules
and regulations of the Agent as from time to time in effect applicable to demand
deposit accounts) be made available to the Borrower and its Material
Subsidiaries for use in the conduct of their business. Upon the occurrence of an
Event of Default, the Agent may apply the funds on deposit in such accounts to
the Obligations.
Section 4.3. Guaranties. The payment and performance of the Obligations
shall at all times be guaranteed by each direct and indirect Material Subsidiary
of the Borrower pursuant to one or more guaranty agreements in form and
substance acceptable to the Agent, as the same may be amended, modified or
supplemented from time to time (individually a "Guaranty" and collectively the
"Guaranties").
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Section 4.4. Further Assurances. The Borrower agrees that it shall, and
shall cause each Material Subsidiary to, from time to time at the request of the
Agent or the Required Banks, execute and deliver such documents and do such acts
and things as the Agent or the Required Banks may reasonably request in order to
provide for or perfect or protect such Liens on the Collateral. In the event any
Subsidiary hereinafter becomes a Material Subsidiary or the Borrower or any
Material Subsidiary forms or acquires any other Material Subsidiary after the
date hereof, the Borrower shall within 10 Business Days of such event, formation
or acquisition cause such newly formed or acquired or existing Material
Subsidiary to execute a Guaranty and such Collateral Documents as the Agent may
then require, and the Borrower shall also deliver to the Agent, or cause such
Material Subsidiary to deliver to the Agent, at the Borrower's cost and expense,
such other instruments, documents, certificates, and opinions reasonably
required by the Agent in connection therewith.
Section 4.5. Liens on After-Acquired Real Property. In the event that
the Borrower or any Material Subsidiary owns or hereafter acquires any real
property, at the request of the Agent or the Required Banks pursuant to the
terms of Section 4.1 above, the Borrower shall, or shall cause such Material
Subsidiary to, execute and deliver to the Agent (or a security trustee therefor)
a mortgage or deed of trust acceptable in form and substance to the Agent for
the purpose of granting to the Agent for the benefit of the Banks a lien on such
real property to secure the Obligations, shall pay all taxes, costs and expenses
incurred by the Agent in recording such mortgage or deed of trust, and shall at
its expense supply to the Agent a survey and a mortgagee's policy of title
insurance from a title insurer reasonably acceptable to the Agent insuring the
validity of such mortgage or deed of trust and its status as a first lien
(subject to liens permitted by this Agreement) on the real property encumbered
thereby and a current environmental assessment (and reliance letter), in form
and substance reasonably acceptable to the Agent, with respect to such real
property.
SECTION 5. DEFINITIONS; INTERPRETATION.
Section 5.1. Definitions. The following terms when used herein shall
have the following meanings:
"Account" is defined in Section 9.4 hereof.
"Acquired Business" means the entity or assets acquired by the Borrower
or a Subsidiary in an Acquisition, whether before or after the date hereof.
"Acquisition" means any transaction or series of related transactions
for the purpose of or resulting, directly or indirectly, in (a) the acquisition
of all or substantially all of the assets of a Person, or of any business or
division of a Person, (b) the acquisition of in excess of 50% of the
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capital stock, partnership interests, membership interests or equity of any
Person, or otherwise causing any Person to become a Subsidiary, or (c) a merger
or consolidation or any other combination with another Person (other than a
Person that is a Subsidiary) provided that the Borrower or the Subsidiary is the
surviving entity.
"Acquisition EBITDA" means, with reference to any period and any
Acquired Business of a Target, the total net income (as determined in accordance
with GAAP) of such Target arising out of the Acquired Business plus the sum of
all amounts deducted in arriving at such net income amount in respect of (x)
interest expense for such period, (y) federal, state, and local income taxes for
such period, and (z) depreciation of fixed assets and amortization of intangible
assets for such period and adjusted for shareholder expenses (including
professional compensation), non-recurring expenses and reasonably anticipated
revenues due to new business or new locations of the Acquired Business (based on
year-to-date historical performance of such new business or new locations), such
adjustments to be reasonably determined by the Borrower in good faith and
established to the reasonably satisfaction of the Agent.
"Adjusted EBITDA" means, with reference to any period, EBITDA for such
period calculated on a pro forma basis, in accordance with the balance sheets,
income statements and other related financial statements furnished to the Agent
and the Banks pursuant to Section 8.15(k) hereof, as if each acquisition
permitted by Section 8.15(k) hereof occurring during such period had taken place
on the first day of such period.
"Adjusted LIBOR" is defined in Section 1.4(b) hereof.
"Affiliate" means any Person directly or indirectly controlling or
controlled by, or under direct or indirect common control with, another Person.
A Person shall be deemed to control another Person for the purposes of this
definition if such Person possesses, directly or indirectly, the power to
direct, or cause the direction of, the management and policies of the other
Person, whether through the ownership of voting securities, common directors,
trustees or officers, by contract or otherwise; provided that, in any event for
purposes of this definition, any Person that owns, directly or indirectly, 5% or
more of the securities having the ordinary voting power for the election of
directors or governing body of a corporation or 5% or more of the partnership or
other ownership interest of any other Person (other than as a limited partner of
such other Person) will be deemed to control such corporation or other Person.
"Agent" means Bank of Montreal, and any successor pursuant to Section
11.7 hereof.
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"Applicable Margin" means, with respect to Loans, Reimbursement
Obligations, and the commitment fees and letter of credit fees payable under
Section 2.1 hereof, the rate per annum specified below:
Applicable Margin for Base Rate Loans under Revolving Credit and
Reimbursement Obligations : 1.5%
Applicable Margin for Eurodollar Loans under Revolving Credit and
letter of credit fee: 3.0%
Applicable Margin for Revolving Credit Commitment fee, Term A Credit
Commitment fee and Term B Credit Commitment fee:
.625%
Applicable Margin for Base Rate Loans under Term Credits 1.50%
Applicable Margin for Eurodollar Loans under Term Credits 3.25%
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; provided, however, that the Applicable Margin shall be subject to quarterly
adjustments on the first Pricing Date, and thereafter from one Pricing Date to
the next the Applicable Margin shall mean a rate per annum determined in
accordance with the following schedule:
APPLICABLE
MARGIN FOR
THE REVOLVING
APPLICABLE APPLICABLE CREDIT
MARGIN FOR MARGIN FOR COMMITMENT
BASE RATE EURODOLLAR FEE, TERM A
LOANS UNDER LOANS UNDER CREDIT APPLICABLE APPLICABLE
TOTAL FUNDED REVOLVING REVOLVING COMMITMENT MARGIN FOR MARGIN FOR
DEBT/ADJUSTED CREDIT AND CREDIT AND FEE AND BASE RATE EURODOLLAR
EBITDA RATIO REIMBURSEMENT LETTER OF TERM B CREDIT LOANS UNDER LOANS UNDER
FOR SUCH OBLIGATIONS CREDIT FEE COMMITMENT TERM TERM
PRICING DATE SHALL BE: SHALL BE: FEE SHALL BE: CREDITS: CREDITS:
Greater than 3.0 1.5% 3.0% .625% 1.5% 3.25%
to 1.0
Equal to or less 1.375% 2.875% .625% 1.375% 3.25%
than 3.0 to 1.0,
but greater than
2.5 to 1.0
Equal to or less 1.25% 2.75% .50% 1.25% 3.0%
than 2.5 to 1.0,
but greater than
2.0 to 1.0
Equal to or less 1.0% 2.5% .50% 1.0% 3.0%
than 2.0 to 1.0,
but greater than
1.5 to 1.0
Equal to or less .75% 2.25% .50% .75% 3.0%
than 1.5 to 1.0
For purposes hereof, the term "Pricing Date" means, for any fiscal quarter of
the Borrower ending on or after June 30, 1998, the date on which the Agent is in
receipt of the Borrower's most recent financial statements for the fiscal
quarter then ended, pursuant to Section 8.5(b) or (c) hereof. The Applicable
Margin shall be established based on the Total Funded Debt/Adjusted EBITDA Ratio
for the most recently completed fiscal quarter and the Applicable Margin
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established on a Pricing Date shall remain in effect until the next Pricing
Date. If the Borrower has not delivered its financial statements by the date
such financial statements (and, in the case of the year-end financial
statements, audit report) are required to be delivered under Section 8.5(b) or
(c) hereof, until such financial statements and audit report are delivered, the
Applicable Margin shall be the highest Applicable Margin (i.e., the Total Funded
Debt/Adjusted EBITDA Ratio shall be deemed to be greater than 3.0 to 1.0). If
the Borrower subsequently delivers such financial statements before the next
Pricing Date, the Applicable Margin established by such late delivered financial
statements shall take effect from the date of delivery until the next Pricing
Date. In all other circumstances, the Applicable Margin established by such
financial statements shall be in effect from the Pricing Date that occurs
immediately after the end of the Borrower's fiscal quarter covered by such
financial statements until the next Pricing Date. Each determination of the
Applicable Margin made by the Agent in accordance with the foregoing shall be
conclusive and binding on the Borrower and the Banks if reasonably determined.
"Application" is defined in Section 1.2(b) hereof.
"Authorized Representative" means those persons shown on the list of
officers provided by the Borrower pursuant to Section 7.1(h) hereof or on any
update of any such list provided by the Borrower to the Agent, or any further or
different officer of the Borrower so named by any Authorized Representative of
the Borrower in a written notice to the Agent.
"Bank" is defined in the introductory paragraph of this Agreement and
includes each assignee bank pursuant to Section 12.12 hereof.
"Base Rate" is defined in Section 1.4(a) hereof.
"Base Rate Loan" means a Loan bearing interest at a rate specified in
Section 1.4(a) hereof.
"Borrower" is defined in the introductory paragraph of this Agreement.
"Borrowing" means the total of Loans of a single type advanced,
continued for an additional Interest Period, or converted from a different type
into such type by the Banks under a Credit on a single date and, in the case of
Eurodollar Loans, for a single Interest Period. Borrowings of Loans are made and
maintained ratably from each of the Banks under a Credit according to their
Percentages of such Credit. A Borrowing is "advanced" on the day Banks advance
funds comprising such Borrowing to the Borrower, is "continued" on the date a
new Interest Period for the same type of Loans commences for such Borrowing, and
is "converted" when such Borrowing is changed from one type of Loans to the
other, all as requested by the Borrower pursuant to Section 1.6(a).
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"Business Day" means any day (other than a Saturday or Sunday) on which
banks are not authorized or required to close in Chicago, Illinois and, if the
applicable Business Day relates to the advance or continuation of, or conversion
into, or payment of a Eurodollar Loan, on which banks are dealing in U.S. Dollar
deposits in the interbank eurodollar market in London, England.
"Capital Expenditures" means, with respect to any Person for any period,
the aggregate amount of all expenditures (whether paid in cash or accrued as a
liability) by such Person during that period which, in accordance with GAAP, are
or should be included as "additions to property, plant or equipment" or similar
items reflected in the statement of cash flows of such Person, provided Capital
Expenditures shall not include amounts paid by the Borrower or any of its
Subsidiaries for the assets or business of a Target pursuant to an Acquisition
permitted by this Agreement.
"Capital Lease" means any lease of Property which in accordance with
GAAP is required to be capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligation" means, for any Person, the amount of the
liability shown on the balance sheet of such Person in respect of a Capital
Lease determined in accordance with GAAP.
"Change of Control" means any of (a) the acquisition by 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 ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇) at any time
of beneficial ownership of 40% or more of the outstanding capital stock of the
Borrower on a fully-diluted basis, (b) the failure of individuals who are
members of the board of directors of the Borrower on the date of this Agreement
(together with any new or replacement directors whose initial nomination for
election was approved by a majority of the directors who were either directors
on the date of this Agreement or previously so approved) to constitute a
majority of the board of directors of the Borrower, or (c) the failure of
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ to own and control at least 1,000,000 shares of the Voting
Stock of the Borrower.
"Code" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto.
"Collateral" means all properties, rights, interests and privileges from
time to time subject to the Liens granted to the Agent, or any security trustee
therefor, by the Collateral Documents.
"Collateral Documents" means the Security Agreement, the Pledge
Agreement, and all other mortgages, deeds of trust, security agreements, pledge
agreements, assignments, financing
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36
statements and other documents as shall from time to time secure or relate to
the Obligations or any part thereof.
"Commitments" means the Revolving Credit Commitments, the L/C
Commitment, the Term A Credit Commitments and the Term B Credit Commitments.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower or any Subsidiary, are treated
as a single employer under Section 414 of the Code.
"Credit" means any one of the Revolving Credit, the Term A Credit or the
Term B Credit.
"Credit Event" means the advancing of any Loan, the continuation of or
conversion into a Eurodollar Loan, the conversion into a Fixed Rate Loan, or the
issuance of, or extension of the expiration date or increase in the amount of,
any Letter of Credit.
"Current Ratio" means, at any time the same is to be determined, the
ratio of (a) current assets of the Borrower and its Subsidiaries at such time to
(b) current liabilities of the Borrower and its Subsidiaries at such time,
current assets and current liabilities each to be computed on a consolidated
basis in accordance with GAAP.
"Default" means any event or condition the occurrence of which would,
with the passage of time or the giving of notice, or both, constitute an Event
of Default.
"EBITDA" means, with reference to any period, Net Income for such period
plus the sum (without duplication) of all amounts deducted in arriving at such
Net Income amount in respect of (w) Interest Expense for such period, (x)
federal, state and local income taxes for such period, (y) depreciation of fixed
assets and amortization of intangible assets for such period, and (z) one-time
charges incurred on or about January 30, 1998, arising out of the prepayment of
the indebtedness owing to Prudential Securities Credit Corporation on or about
January 30, 1998.
"Eligible Line of Business" means any business engaged in as of the date
of this Agreement by the Borrower or any Subsidiary existing as of the date of
this Agreement (including the Borrower) and any other business activities
reasonably related thereto in the healthcare industry.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, or any successor statute thereto.
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"Eurodollar Loan" means a Loan bearing interest at the rate specified in
Section 1.4(b) hereof.
"Eurodollar Reserve Percentage" is defined in Section 1.4(b) hereof.
"Event of Default" means any event or condition identified as such in
Section 9.1 hereof.
"Federal Funds Rate" means the fluctuating interest rate per annum
described in part (x) of clause (ii) of the definition of Base Rate appearing in
Section 1.4(a) hereof.
"Fixed Rate Loan" means a Term Loan bearing interest at the rate
determined pursuant to Section 1.4(c) hereof.
"Fixed Rate" is defined in Section 1.4(c) hereof.
"Floating Rate Payor" is defined in Section 1.4(c) hereof.
"GAAP" means generally accepted accounting principles set forth from
time to time in the opinions and pronouncements of the Accounting Principles
Board and the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board (or agencies with
similar functions of comparable statute and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date of
determination.
"Guaranty" is defined in Section 4.2 hereof.
"Hedging Liability" means the liability of the Borrower to any of the
Banks in respect of any interest rate swaps, interest rate caps, interest rate
collars, or other interest rate hedging arrangements as the Borrower may from
time to time enter into with any one or more of the Banks party to this
Agreement. Unless and until the amount of the Hedging Liability is fixed and
determined, the Hedging Liability shall be deemed to be 4% per annum of the
notional amount of the hedge from the date of computation to the date the hedge
expires.
"Hostile Acquisition" means the acquisition of the capital stock or
other equity interests of a Person through a tender offer or similar
solicitation of the owners of such capital stock or other equity interests which
has not been approved (prior to such acquisition) by resolutions of the Board of
Directors of such Person or by similar action if such Person is not a
corporation, and as to which such approval has not been withdrawn.
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"Indebtedness for Borrowed Money" means for any Person (without
duplication and, with respect to the Borrower and its Subsidiaries, on a
consolidated basis) (i) all indebtedness created, assumed or incurred in any
manner by such Person representing money borrowed (including by the issuance of
debt securities), (ii) all indebtedness for the deferred purchase price of
property or services (other than trade accounts payable arising in the ordinary
course of business), (iii) all indebtedness secured by any Lien upon Property of
such Person, whether or not such Person has assumed or become liable for the
payment of such indebtedness, (iv) all Capitalized Lease Obligations of such
Person and (v) all obligations of such Person on or with respect to letters of
credit, bankers' acceptances and other extensions of credit whether or not
representing obligations for borrowed money, but in any event not including
rentals due under operating leases.
"Interest Expense" means, with reference to any period, the sum of all
interest charges (including imputed interest charges with respect to Capitalized
Lease Obligations and all amortization of debt discount and expense) of the
Borrower and its Subsidiaries for such period determined on a consolidated basis
in accordance with GAAP, but not including interest charges incurred prior to
January 30, 1998, arising out of the indebtedness owing to Prudential Securities
Credit Corporation repaid in full on or about January 30, 1998.
"Interest Period" is defined in Section 1.7 hereof.
"L/C Commitment" means $5,000,000, as reduced pursuant to the terms
hereof.
"L/C Obligations" means the aggregate undrawn face amounts of all
outstanding Letters of Credit and all unpaid Reimbursement Obligations.
"Lending Office" is defined in Section 10.4 hereof.
"Letter of Credit" is defined in Section 1.2(a) hereof.
"LIBOR" is defined in Section 1.4(b) hereof.
"Lien" means any mortgage, lien, security interest, pledge, charge or
encumbrance of any kind in respect of any Property, including the interests of a
vendor or lessor under any conditional sale, Capital Lease or other title
retention arrangement.
"Loan" means a Base Rate Loan or Eurodollar Loan or Fixed Rate Loan,
each of which is a "type" of Loan hereunder, outstanding as a Revolving Loan or
Term A Loan or Term B Loan, as applicable.
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"Loan Documents" means this Agreement, the Notes, the Applications, the
Collateral Documents, the Guaranties, and each other instrument or document to
be delivered hereunder or thereunder or otherwise in connection therewith.
"Majority Banks" means, as of the date of determination thereof, Banks
whose outstanding Loans and interests in Letters of Credit and Unused Revolving
Credit Commitments and unfunded Term A Credit Commitments and unfunded Term B
Credit Commitments constitute more than 50% of the sum of the total outstanding
Loans, interests in Letters of Credit, Unused Revolving Credit Commitments,
unfunded Term A Credit Commitments, and unfunded Term B Credit Commitments of
the Banks.
"Material Adverse Effect" means (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, condition
(financial or otherwise) or prospects of the Borrower, or the Borrower and its
Subsidiaries taken as a whole; (b) a material impairment of the ability of the
Borrower or any Subsidiary to perform its obligations under any Loan Document;
or (c) a material adverse effect upon the legality, validity, binding effect or
enforceability against the Borrower or any Subsidiary of any Loan Document.
"Material Subsidiary" means each Subsidiary, other than (a) so long as
the Borrower is in compliance with Section 8.28 hereof, Block Vision of Texas,
Inc., Vision Insurance Plan of America, Inc., Vision Twenty-One Surgery Center,
Ltd., and Vision Twenty-One Surgery Center-Largo, Ltd. and (b) any Subsidiary
that does not engage in any significant business activity or own any asset or
assets (including the capital stock of another Person) with a fair market value
in excess of $1,000 or generate revenues in excess of $1,000 annually and does
not have any Subsidiary other than an inactive subsidiary (within the meaning of
this clause (b)).
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc.
"Minneapolis Acquisition" means that certain Acquisition described in
the Borrower's letter to the Agent dated July 1, 1998, a copy of which is on
file with the Agent.
"Net Income" means, with reference to any period, the net income (or net
loss) of the Borrower and its Subsidiaries for such period computed on a
consolidated basis in accordance with GAAP.
"Net Worth" means, at any time the same is to be determined, total
shareholder's equity (including capital stock, additional paid-in capital and
retained earnings after deducting treasury stock) which would appear on the
balance sheet of the Borrower and its Subsidiaries prepared on a consolidated
basis in accordance with GAAP.
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"Notes" means and includes the Revolving Notes, the Term A Notes,
and the Term B Notes.
"Obligations" means all fees payable hereunder, all obligations of
the Borrower to pay principal and interest on Loans and Reimbursement
Obligations, and all other payment obligations of the Borrower or any
Subsidiary arising under or in relation to any Loan Document, in each case
whether now existing or hereafter arising.
"Participating Bank" is defined in Section 1.2(d) hereof.
"Participating Interest" is defined in Section 1.2(d) hereof.
"PBGC" means the Pension Benefit Guaranty Corporation or any Person
succeeding to any or all of its functions under ERISA.
"Percentage" means for any Bank its Revolver Percentage, Term A
Loan Percentage, or Term B Loan Percentage, as applicable.
"Permitted Acquisition" means the Minneapolis Acquisition, and any
other Acquisition with respect to which all of the following conditions shall
have been satisfied:
(a) the Acquired Business is an Eligible Line
of Business, the Target of the Acquisition is a professional
association of ophthalmologists and/or optometrists and is not a
practice management firm, and the Acquisition consists of the
purchase by the Borrower or a Subsidiary of the "business assets"
from such Target concurrently with the Borrower or such Subsidiary
entering into a long-term management agreement with such Target to
provide management and administrative services to such Target on a
fee basis;
(b) the Acquisition shall not be a Hostile
Acquisition;
(c) the financial statements of the Acquired
Business shall have been audited by one of the "Big Six" accounting
firms or by another independent accounting firm of national or
regional repute or such accountants are otherwise reasonably
satisfactory to the Agent, or if such financial statements have not
been audited by such an accounting firm, such financial statements
shall have been approved as to form and substance to the reasonable
satisfaction of the Agent;
(d) the Total Consideration paid for the Target
shall not exceed 7.0 times the Acquisition EBITDA of the Acquired
Business for the four fiscal quarter period immediately preceding
the date of the Acquisition;
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(e) of the Total Consideration paid for the
Target, not less than 40% thereof shall consist of equity
securities of the Borrower;
(f) after giving effect to the Acquisition, no
Default or Event of Default shall exist, including with respect to
the covenants contained in Section 8 on a pro forma basis; and
(g) the Total Consideration paid for the Target
shall not exceed $7,500,000 without prior approval by the Agent.
"Person" means an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization or any other
entity or organization, including a government or agency or political
subdivision thereof.
"Plan" means any employee pension benefit plan covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code that either (i) is maintained by a member of the Controlled Group for
employees of a member of the Controlled Group or (ii) is maintained pursuant to
a collective bargaining agreement or any other arrangement under which more
than one employer makes contributions and to which a member of the Controlled
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions.
"Pledge Agreement" means that certain Pledge Agreement dated as of
January 30, 1998, among the Borrower, certain of its Subsidiaries, and the
Agent, as the same may be amended, modified or restated from time to time.
"Property" means any interest in any kind of property or asset,
whether real, personal or mixed, or tangible or intangible.
"Reimbursement Obligation" is defined in Section 1.2(c) hereof.
"Required Banks" means, as of the date of determination thereof,
Banks whose outstanding Loans and interests in Letters of Credit and Unused
Revolving Credit Commitments and unfunded Term A Credit Commitments and
unfunded Term B Credit Commitments constitute more than 66 2/3% of the sum of
the total outstanding Loans, interests in Letters of Credit, Unused Revolving
Credit Commitments, unfunded Term A Credit Commitments, and unfunded Term B
Credit Commitments of the Banks.
"Revolver Percentage" means, for each Bank, the percentage of the
Revolving Credit Commitments represented by such Bank's Revolving Credit
Commitment or, if the Revolving Credit Commitments have been terminated, the
percentage held by such Bank (including through
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participation interests in Reimbursement Obligations) of the aggregate
principal amount of all Revolving Loans and L/C Obligations then outstanding.
"Revolving Credit" means the credit facility for making Revolving
Loans and issuing Letters of Credit described in Sections 1.1 and 1.2 hereof.
"Revolving Credit Commitment" is defined in Section 1.1 hereof. The
Borrower and the Banks acknowledge and agree that the Revolving Credit
Commitments of the Banks aggregate $7,500,000 on the date hereof.
"Revolving Credit Termination Date" means June 30, 2003, or such
later date to which the same may be extended pursuant to Section 2.2 hereof, or
such earlier date on which the Revolving Credit Commitments are terminated in
whole pursuant to Section 1.13, 9.2 or 9.3 hereof.
"Revolving Loan" is defined in Section 1.1 hereof and, as so
defined, includes a Base Rate Loan or a Eurodollar Loan, each of which is a
"type" of Revolving Loan hereunder.
"Revolving Note" is defined in Section 1.11(a) hereof.
"S&P" means Standard & Poor's Ratings Services Group, a division of
The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
"Security Agreement" means that certain Security Agreement dated as
of January 30, 1998, among the Borrower, certain of its Subsidiaries, and the
Agent, as the same may be amended, modified or restated from time to time.
"subsidiary" means, as to any particular parent corporation or
organization, any other corporation or organization more than 50% of the
outstanding Voting Stock of which is at the time directly or indirectly owned
by such parent corporation or organization or by any one or more other entities
which are themselves subsidiaries of such parent corporation or organization.
The term "Subsidiary" means a subsidiary of the Borrower or of any of its
direct or indirect Subsidiaries.
"Target" means the Persons whose assets or equity interests are the
subject of an Acquisition.
"Term A Credit" means the credit facility for Term A Loans
described in Section 1.3(a) hereof.
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"Term A Credit Commitment" is defined in Section 1.3(a) hereof. The
Borrower and the Banks acknowledge and agree that the Term A Credit Commitments
of the Banks aggregate $22,500,000 on the date hereof.
"Term A Credit Final Maturity Date " means June 30, 2003.
"Term A Credit Commitment Termination Date" means June 30, 1999, or
such earlier date on which the Term A Credit Commitments are terminated in
whole pursuant to Section 1.13, 9.2, or 9.3 hereof.
"Term A Loan" is defined in Section 1.3(a) hereof and, as so
defined, includes a Base Rate Loan or a Eurodollar Loan, each of which is a
"type" of Term A Loan hereunder.
"Term A Loan Percentage" means, for each Bank, the percentage of
the Term A Credit Commitment represented by such Bank's Term A Credit
Commitment or, if the Term A Credit Commitments have been terminated or have
expired, the percentage held by such Bank of the aggregate principal amount of
all Term A Loans then outstanding.
"Term A Note" is defined in Section 1.11(b) hereof.
"Term B Credit" means the credit facility for Term B Loans
described in Section 1.3(b) hereof.
"Term B Credit Commitment" is defined in Section 1.3(b) hereof. The
Borrower and the Banks acknowledge and agree that the Term B Credit Commitments
of the Banks aggregate $70,000,000 on the date hereof.
"Term B Credit Final Maturity Date " means June 30, 2005.
"Term B Credit Commitment Termination Date" means September 30,
1998, or such earlier date on which the Term B Credit Commitments are
terminated in whole pursuant to Section 1.13, 9.2, or 9.3 hereof.
"Term B Loan" is defined in Section 1.3(b) hereof and, as so
defined, includes a Base Rate Loan or a Eurodollar Loan or a Fixed Rate Loan,
each of which is a "type" of Term B Loan hereunder.
"Term B Loan Percentage" means, for each Bank, the percentage of
the Term B Credit Commitments represented by such Bank's Term B Credit
Commitment or, if the Term B Credit Commitments have been terminated or have
expired, the percentage held by such Bank of the aggregate principal amount of
all Term B Loans then outstanding.
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"Term B Note" is defined in Section 1.11(c) hereof.
"Term Credits" means and includes the Term A Credit and the Term B
Credit.
"Term Loans" means and includes the Term A Loans and the Term B
Loans.
"Total Capitalization" means, at any time the same is to be
determined, the sum of Total Funded Debt plus Net Worth.
"Total Consideration" means the total amount (but without
duplication) of (a) cash paid in connection with any Acquisition, plus (b)
indebtedness payable to the seller in connection with such Acquisition, plus
(c) the fair market value of any equity securities, including any warrants or
options therefor, delivered in connection with any Acquisition, plus (d) the
present value of covenants not to compete entered into in connection with such
Acquisition or other future payments which are required to be made over a
period of time and are not contingent upon the Borrower or its Subsidiary
meeting financial performance objectives (discounted at the Base Rate), but
only to the extent not included in clause (a), (b), or (c) above, plus (e) the
amount of indebtedness assumed in connection with such Acquisition.
"Total Funded Debt" means, at any time the same is to be
determined, the aggregate of all Indebtedness for Borrowed Money of the
Borrower and its Subsidiaries at such time, including all Indebtedness for
Borrowed Money of any other Person which is directly or indirectly guaranteed
by the Borrower or any of its Subsidiaries or which the Borrower or any of its
Subsidiaries has agreed (contingently or otherwise) to purchase or otherwise
acquire or in respect of which the Borrower or any of its Subsidiaries has
otherwise assured a creditor against loss.
"Total Funded Debt/Adjusted EBITDA Ratio" means, as of the last day
of any fiscal quarter of the Borrower, the ratio of (a) the Total Funded Debt
of the Borrower and its Subsidiaries as of the last day of such fiscal quarter
to (b) Adjusted EBITDA for the period of four fiscal quarters then ended.
"Unfunded Vested Liabilities" means, for any Plan at any time, the
amount (if any) by which the present value of all vested nonforfeitable accrued
benefits under such Plan exceeds the fair market value of all Plan assets
allocable to such benefits, all determined as of the then most recent valuation
date for such Plan, but only to the extent that such excess represents a
potential liability of a member of the Controlled Group to the PBGC or the Plan
under Title IV of ERISA.
"U.S. Dollars" and "$" each means the lawful currency of the United
States of America.
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"Unused Revolving Credit Commitments" means, at any time, the
difference between the Revolving Credit Commitments then in effect and the
aggregate outstanding principal amount of Revolving Loans and L/C Obligations.
"Voting Stock" of any Person means capital stock or other equity
interests of any class or classes (however designated) having ordinary power
for the election of directors or other similar governing body of such Person,
other than stock or other equity interests having such power only by reason of
the happening of a contingency.
"Year 2000 Problem" means any risk that computer hardware, software
or equipment containing embedded microchips essential to the business or
operations of a Person will not, in the case of date or time periods occurring
after December 31, 1999, function at least as effectively and reliably as in
the case of times or time periods occurring before January 1, 2000, including
the making of accurate leap year calculations.
"Welfare Plan" means a "welfare plan" as defined in Section 3(1)
of ERISA.
"Wholly-owned Subsidiary" means a Subsidiary of which all of the
issued and outstanding shares of capital stock (other than directors'
qualifying shares as required by law) or other equity interests are owned by
the Borrower and/or one or more Wholly-owned Subsidiaries within the meaning of
this definition.
Section 5.2. Interpretation. The foregoing definitions
are equally applicable to both the singular and plural forms of the terms
defined. The words "hereof", "herein", and "hereunder" and words of like import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement. All references to time of day
herein are references to Chicago, Illinois time unless otherwise specifically
provided. Where the character or amount of any asset or liability or item of
income or expense is required to be determined or any consolidation or other
accounting computation is required to be made for the purposes of this
Agreement, it shall be done in accordance with GAAP except where such
principles are inconsistent with the specific provisions of this Agreement.
Section 5.3. Change in Accounting Principles. If, after
the date of this Agreement, there shall occur any change in GAAP from those
used in the preparation of the financial statements referred to in Section 6.5
hereof and such change shall result in a change in the method of calculation of
any financial covenant, standard or term found in this Agreement, either the
Borrower or the Required Banks may by notice to the Banks and the Borrower,
respectively, require that the Banks and the Borrower negotiate in good faith
to amend such covenants, standards, and term so as equitably to reflect such
change in accounting principles, with the desired result being that the
criteria for evaluating the financial condition of the Borrower and its
Subsidiaries shall be the same as if such change had not been made. No delay by
the Borrower
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or the Required Banks in requiring such negotiation shall limit their right to
so require such a negotiation at any time after such a change in accounting
principles. Until any such covenant, standard, or term is amended in accordance
with this Section 5.3, financial covenants shall be computed and determined in
accordance with GAAP in effect prior to such change in accounting principles.
Without limiting the generality of the foregoing, the Borrower shall neither be
deemed to be in compliance with any financial covenant hereunder nor out of
compliance with any financial covenant hereunder if such state of compliance or
noncompliance, as the case may be, would not exist but for the occurrence of a
change in accounting principles after the date hereof.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants to the Agent and the Banks as
follows:
Section 6.1. Organization and Qualification. The
Borrower is duly organized, validly existing and in good standing as a
corporation under the laws of the state of its incorporation, has full and
adequate corporate power to own its Property and conduct its business as now
conducted, and is duly licensed or qualified and in good standing in each
jurisdiction in which the nature of the business conducted by it or the nature
of the Property owned or leased by it requires such licensing or qualifying,
except where the failure to do so would not have a Material Adverse Effect.
Section 6.2. Subsidiaries. Each Subsidiary is duly
organized, validly existing and in good standing under the laws of the
jurisdiction in which it is incorporated or organized, as the case may be, has
full and adequate power to own its Property and conduct its business as now
conducted, and is duly licensed or qualified and in good standing in each
jurisdiction in which the nature of the business conducted by it or the nature
of the Property owned or leased by it requires such licensing or qualifying,
except where the failure to do so would not have a Material Adverse Effect.
Schedule 6.2 hereto (as the same may be deemed amended pursuant to Section
8.16(c) or 8.23 hereof) identifies each Subsidiary, the jurisdiction of its
incorporation or organization, as the case may be, the percentage of issued and
outstanding shares of each class of its capital stock or other equity interests
owned by the Borrower and the other Subsidiaries and, if such percentage is not
100% (excluding directors' qualifying shares as required by law), a description
of each class of its authorized capital stock and other equity interests and
the number of shares of each class issued and outstanding. All of the
outstanding shares of capital stock and other equity interests of each
Subsidiary are validly issued and outstanding and fully paid and nonassessable
and all such shares and other equity interests indicated on Schedule 6.2 (as
the same may be deemed amended pursuant to Section 8.16(c) or 8.23 hereof) as
owned by the Borrower or a Subsidiary are owned, beneficially and of record, by
the Borrower or such Subsidiary free and clear of all Liens other than the
Liens granted in favor of the Agent pursuant
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to the Collateral Documents. There are no outstanding commitments or other
obligations of any Subsidiary to issue, and no options, warrants or other
rights of any Person to acquire, any shares of any class of capital stock or
other equity interests of any Subsidiary.
Section 6.3. Authority and Validity of Obligations. The
Borrower has full right and authority to enter into this Agreement and the
other Loan Documents executed by it, to make the borrowings herein provided
for, to issue its Notes in evidence thereof, to grant to the Agent the Liens
described in the Collateral Documents executed by the Borrower, and to perform
all of its obligations hereunder and under the other Loan Documents executed by
it. Each Material Subsidiary has full right and authority to enter into the
Loan Documents executed by it, to guarantee the Obligations, to grant to the
Agent the Liens described in the Collateral Documents executed by such Person,
and to perform all of its obligations under the Loan Documents executed by it.
The Loan Documents delivered by the Borrower and by each Subsidiary have been
duly authorized, executed and delivered by such Person and constitute valid and
binding obligations of such Person enforceable in accordance with their terms
except as enforceability may be limited by bankruptcy, insolvency, fraudulent
conveyance or similar laws affecting creditors' rights generally and general
principles of equity (regardless of whether the application of such principles
is considered in a proceeding in equity or at law); and this Agreement and the
other Loan Documents do not, nor does the performance or observance by the
Borrower or any Subsidiary of any of the matters and things herein or therein
provided for, (a) contravene or constitute a default under any provision of law
or any judgment, injunction, order or decree binding upon the Borrower or any
Subsidiary or any provision of the charter, articles of incorporation or
by-laws of the Borrower or any Subsidiary, (b) contravene or constitute a
default under any covenant, indenture or agreement of or affecting the Borrower
or any Subsidiary or any of its Property, in each case where such contravention
or default is reasonably likely to have a Material Adverse Effect, or (c)
result in the creation or imposition of any Lien on any Property of the
Borrower or any Subsidiary other than the Liens granted in favor of the Agent
pursuant to the Collateral Documents.
Section 6.4. Use of Proceeds; Margin Stock. The
Borrower shall use the proceeds of (i) the Term A Loans and any advance of the
Term B Loans made after the date of this Agreement solely for the purpose of
financing one or more acquisitions permitted by Section 8.13(k) of this
Agreement and (ii) the Revolving Loans, the initial advance of Term B Loans
made on the date of this Agreement, and the Letters of Credit made available
hereunder to refinance existing indebtedness on the date of this Agreement and
for its general working capital purposes and such other legal and proper
purposes as are consistent with all applicable laws. Neither the Borrower nor
any Subsidiary is engaged in the business of extending credit for the purpose
of purchasing or carrying margin stock (within the meaning of Regulation U of
the Board of Governors of the Federal Reserve System), and no part of the
proceeds of any Loan or any other extension of credit made hereunder will be
used to purchase or carry any such margin
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stock or to extend credit to others for the purpose of purchasing or carrying
any such margin stock. Margin stock (as hereinabove defined) constitutes less
than 25% of those assets of the Borrower and its Subsidiaries which are subject
to any limitation on sale, pledge, or other restriction hereunder.
Section 6.5. Financial Reports. The consolidated
balance sheet of the Borrower and its Subsidiaries as at December 31, 1997, and
the related consolidated statements of income, retained earnings and cash flows
of the Borrower and its Subsidiaries for the fiscal year then ended, and
accompanying notes thereto, which financial statements are accompanied by the
audit report of Ernst & Young, independent public accountants, and the
unaudited interim consolidated balance sheet of the Borrower and its
Subsidiaries as at March 31, 1998, and the related consolidated statements of
income and retained earnings of the Borrower and its Subsidiaries for the 3
months then ended, heretofore furnished to the Banks, fairly present in all
material respects the consolidated financial condition of the Borrower and its
Subsidiaries as at said dates and the consolidated results of their operations
and cash flows for the periods then ended in conformity with GAAP applied on a
consistent basis. Neither the Borrower nor any other Subsidiary has contingent
liabilities which are material to it other than as indicated on such financial
statements or which have been incurred after such date with respect to
Acquisitions consummated prior to the date of this Agreement and either
disclosed on Schedule 6.7 attached hereto or disclosed to the Banks in the
written materials delivered to the Banks pursuant to Section 6.7 hereof or,
with respect to future periods, on the financial statements furnished pursuant
to Section 8.5 hereof.
Section 6.6. No Material Adverse Change. Since March 31,
1998, there has been no change in the condition (financial or otherwise) or
business prospects of the Borrower or any Subsidiary, except those occurring in
the ordinary course of business and in connection with the Acquisitions
consummated prior to the date of this Agreement, none of which individually or
in the aggregate have been materially adverse.
Section 6.7. Full Disclosure. The information set forth
on Schedule 6.7 hereof and the statements and information furnished by Borrower
to the Banks in connection with the negotiation of this Agreement and the other
Loan Documents and the commitments by the Banks to provide all or part of the
financing contemplated hereby do not contain any untrue statements of a
material fact or omit a material fact necessary to make the material statements
contained herein or therein, in the light of the circumstances under which they
were made, not misleading, the Banks acknowledging that any projections and
other forward-looking statements regarding future expectations and the beliefs
(the "Statements") furnished by the Borrower to the Banks are subject to risks
and uncertainties which could cause actual results to differ materially from
the Statements made by the Borrower and that the Borrower only represents that
at the time the Statements were made by the Borrower to the Banks, the Borrower
did not know of any material facts that would cause the Statements to be
untrue.
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Section 6.8. Trademarks, Franchises, and Licenses. The
Borrower and each of the Subsidiaries own, possess, or have the right to use
all necessary patents, licenses, franchises, trademarks, trade names, trade
styles, copyrights, trade secrets, know how and confidential commercial and
proprietary information to conduct their businesses as now conducted, without
known conflict with any patent, license, franchise, trademark, trade name,
trade style, copyright or other proprietary right of any other Person.
Section 6.9. Governmental Authority and Licensing. The
Borrower and each of the Subsidiaries have received all licenses, permits, and
approvals of all Federal, state, local, and foreign governmental authorities,
if any, necessary to conduct their business, in each case where the failure to
obtain or maintain the same is reasonably likely to have a Material Adverse
Effect. No investigation or proceeding which, if adversely determined, is
reasonably likely to result in revocation or denial of any material license,
permit, or approval, or of any right to receive reimbursement or payments under
Medicare or other governmental third-party reimbursement or prospective payment
program, is pending or, to the knowledge of the Borrower, threatened.
Section 6.10. Good Title. The Borrower and each of the
Subsidiaries have good and defensible title (or valid leasehold interests) to
their assets as reflected on the most recent consolidated balance sheet of the
Borrower and its Subsidiaries furnished to the Banks (except for sales of
assets in the ordinary course of business), subject to no Liens other than such
thereof as are permitted by Section 8.14.
Section 6.11. Litigation and Other Controversies. There
is no litigation or governmental proceeding or labor controversy pending, nor
to the knowledge of the Borrower threatened, against the Borrower or any
Subsidiary which if adversely determined is reasonably likely to have a
Material Adverse Effect.
Section 6.12. Taxes. All tax returns required to be filed
by the Borrower or any Subsidiary in any jurisdiction have, in fact, been
filed, and all taxes, assessments, fees and other governmental charges upon the
Borrower or any Subsidiary or upon any of their respective Properties, income
or franchises, which are shown to be due and payable in such returns, have been
paid, except such taxes, assessments, fees and governmental charges, if any, as
are being contested in good faith and by appropriate proceedings which prevent
enforcement of the matter under contest and as to which adequate reserves
established in accordance with GAAP have been provided. Except as disclosed on
Schedule 6.12 hereof, the Borrower does not know of any proposed additional tax
assessment against the Borrower or any Subsidiary for which adequate provisions
in accordance with GAAP have not been made on their accounts. Adequate
provisions in accordance with GAAP for taxes on the books of the Borrower and
each Subsidiary have been made for all open years, and for its current fiscal
period.
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Section 6.13. Approvals. No authorization, consent,
license, or exemption from, or filing or registration with, any court or
governmental department, agency or instrumentality, nor any approval or consent
of the stockholders of the Borrower, or any Subsidiary, or any other Person, is
or will be necessary to the valid execution, delivery or performance by the
Borrower or any Subsidiary of this Agreement or any other Loan Document, except
for (i) such approvals which have been obtained prior to the date of this
Agreement and which remain in full force and effect or are otherwise subject to
the terms of Section 6.9 hereof and (ii) the filing of financing statements
with respect to the Collateral.
Section 6.14. Affiliate Transactions. Neither the
Borrower nor any Subsidiary is a party to any contracts or agreements with any
of its Affiliates on terms and conditions which are less favorable to the
Borrower or such Subsidiary than would be usual and customary in similar
contracts or agreements between Persons not affiliated with each other.
Section 6.15. Investment Company; Public Utility Holding
Company. Neither the Borrower nor any Subsidiary is an "investment company" or
a company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or a "public utility holding
company" within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
Section 6.16. ERISA. The Borrower and each Subsidiary,
and each member of its Controlled Group, has fulfilled its obligations under
the minimum funding standards of, and is in compliance in all material respects
with, ERISA and the Code to the extent applicable to any Plan maintained by it
or for the benefit of its employees and has not incurred any liability to the
PBGC or a Plan under Title IV of ERISA other than a liability to the PBGC for
premiums under Section 4007 of ERISA. Neither the Borrower nor any Subsidiary
has any material contingent liabilities with respect to any post-retirement
benefits under a Welfare Plan, other than liability for continuation coverage
described in article 6 of Title I of ERISA.
Section 6.17. Compliance with Laws. The Borrower and
each Subsidiary are in compliance with the requirements of all federal, state
and local laws, rules and regulations applicable to or pertaining to their
Properties or business operations (including, without limitation, the
Occupational Safety and Health Act of 1970, the Americans with Disabilities Act
of 1990, laws and regulations relating to the providing of health care services
and products, and laws and regulations establishing quality criteria and
standards for air, water, land and toxic or hazardous wastes and substances),
where any such non-compliance, individually or in the aggregate, is reasonably
likely to have a Material Adverse Effect. Neither the Borrower nor any
Subsidiary has received notice to the effect that its operations are not in
compliance with any of the requirements of applicable federal, state or local
environmental, health and safety statutes and regulations or are the subject of
any governmental investigation evaluating whether any remedial
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action is needed to respond to a release of any toxic or hazardous waste or
substance into the environment, where any such non-compliance or remedial
action, individually or in the aggregate, is reasonably likely to have a
Material Adverse Effect.
Section 6.18. Other Agreements. Neither the Borrower nor
any Subsidiary is in default under the terms of any covenant, indenture or
agreement of or affecting such Persons or any of their Properties, which
default if uncured is reasonably likely to have a Material Adverse Effect.
Section 6.19. Solvency. The Borrower and its
Subsidiaries, on a consolidated basis, are solvent, able to pay their debts as
they become due, and have sufficient capital to carry on their business and all
businesses in which they are about to engage.
Section 6.20. Capital Structure. On the date of this
Agreement, the Borrower's capital stock consists of 50,000,000 shares of
authorized common stock, $.001 par value, of which 12,570,972 shares are
outstanding, all of which have been validly issued, are fully paid, and
non-assessable; and 10,000,000 shares of authorized preferred stock, of which
no shares are outstanding.
Section 6.21. Year 2000 Compliance. The Borrower and its
Subsidiaries have conducted a review and assessment of their computer
applications, and have made inquiry of their material suppliers, vendors and
customers, with respect to any Year 2000 Problems. Based on the foregoing
review, assessment and inquiry, the Borrower believes any such Year 2000
Problems, individually or in the aggregate, are not reasonably likely to have a
Material Adverse Effect.
Section 6.22. No Default. No Default or Event of Default
has occurred and is continuing.
SECTION 7. CONDITIONS PRECEDENT.
The obligation of each Bank to advance, continue or convert any
Loan (other than the continuation of, or conversion into, a Base Rate Loan) or
of the Agent to issue, extend the expiration date (including by not giving
notice of non-renewal) of or increase the amount of any Letter of Credit under
this Agreement, shall be subject to the following conditions precedent:
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Section 7.1. Initial Credit Event. Before or concurrently
with the initial Credit Event:
(a) the Agent shall have received for each Bank
this Agreement duly executed by the Borrower and the Banks;
(b) the Agent shall have received for each Bank
such Bank's duly executed Notes of the Borrower dated the
date hereof and otherwise in compliance with the provisions
of Section 1.11 hereof;
(c) Agent shall have received a reaffirmation
and/or supplements to the Guaranty Agreement, the Security
Agreement and the Pledge Agreement, duly executed by each
Material Subsidiary, together with (i) to the extent not
heretofore delivered to the Agent, original stock
certificates or other similar instruments or securities
representing all of the issued and outstanding shares of
capital stock or other equity interest of each Subsidiary as
of the date of this Agreement (other than Block Vision of
Texas, Inc., Vision Insurance Plan of America, Inc., Vision
Twenty-One Surgery Center, Ltd., and Vision Twenty-One
Surgery Center-Largo, Ltd.), (ii) to the extent not
heretofore delivered to the Agent, stock powers for the
Collateral consisting of the stock or other equity interest
of each Subsidiary (other than Block Vision of Texas, Inc.,
Vision Insurance Plan of America, Inc., Vision Twenty-One
Surgery Center, Ltd., and Vision Twenty-One Surgery
Center-Largo, Ltd.), each to be executed in blank and
undated, and (iii) to the extent not heretofore delivered to
the Agent, UCC financing statements to be filed against the
Borrower, and each Material Subsidiary, as debtor, in favor
of the Agent, as secured party;
(d) the Agent shall have received evidence of
insurance required to be maintained under the Loan Documents,
naming the Agent as loss payee;
(e) the Agent shall have received for each Bank
copies of the Borrower's and each Material Subsidiary's
articles of incorporation and bylaws (or comparable
constituent documents) and any amendments thereto, certified
in each instance by its Secretary or Assistant Secretary;
(f) the Agent shall have received for each Bank
copies of resolutions of the Borrower's and of each Material
Subsidiary's Board of Directors authorizing the execution,
delivery and performance of this Agreement and the other Loan
Documents to which it is a party and the consummation of the
transactions contemplated hereby and thereby, together with
specimen signatures of the persons authorized to execute such
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documents on the Borrower's and such Material Subsidiary's
behalf, all certified in each instance by its Secretary or
Assistant Secretary;
(g) the Agent shall have received for each Bank
copies of the certificates of good standing for the Borrower
and for each Material Subsidiary (dated no earlier than 30
days prior to the date hereof) from the office of the
secretary of the state of its incorporation and of each state
in which it is qualified to do business as a foreign
corporation;
(h) the Agent shall have received for each Bank
a list of the Borrower's Authorized Representatives;
(i) the Agent shall have received for itself
and for the Banks the initial fees called for by Section 2.1
hereof;
(j) each Bank shall have received such
evaluations and certifications as it may reasonably require
(including a compliance certificate in the form attached
hereto as Exhibit H containing compliance calculations of the
financial covenants as of March 31, 1998) in order to satisfy
itself as to the value of the Collateral, the financial
condition of the Borrower and its Subsidiaries, and the lack
of material contingent liabilities of the Borrower and its
Subsidiaries; and
(k) the Agent shall have received for each Bank
the favorable written opinions of counsel to the Borrower and
its Subsidiaries, in form and substance reasonably
satisfactory to the Agent.
Section 7.2. All Credit Events. As of the time of each
Credit Event hereunder:
(a) in the case of a Borrowing the Agent shall
have received the notice required by Section 1.6 hereof, in
the case of the issuance of any Letter of Credit the Agent
shall have received a duly completed Application for such
Letter of Credit together with any fees called for by Section
2.1 hereof and, in the case of an extension or increase in
the amount of a Letter of Credit, a written request therefor
in a form acceptable to the Agent together with fees called
for by Section 2.1 hereof;
(b) each of the representations and warranties
set forth in Section 6 hereof shall be and remain true and
correct as of such time, except to the extent that any such
representation or warranty relates solely to an earlier time;
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(c) the Borrower shall be in full compliance
with all of the terms and conditions hereof, and no Default
or Event of Default shall have occurred and be continuing
hereunder or would occur as a result of such Credit Event;
and
(d) such Credit Event shall not violate any
order, judgment or decree of any court or other authority or
any provision of law or regulation applicable to any Bank
(including, without limitation, Regulation U of the Board of
Governors of the Federal Reserve System).
Each request for a Borrowing hereunder and each request for the
issuance of, increase in the amount of, or extension of the expiration date of,
a Letter of Credit shall be deemed to be a representation and warranty by the
Borrower on the date on such Credit Event as to the facts specified in
subsections (a) through (c), both inclusive, this Section 7.2.
SECTION 8. COVENANTS.
The Borrower agrees that, so long as any Note or any L/C Obligation
is outstanding or any Commitment is available to or in use by the Borrower
hereunder, except to the extent compliance in any case or cases is waived in
writing by the Required Banks:
Section 8.1. Maintenance of Business. The Borrower shall, and
shall cause each Subsidiary to, preserve and maintain its existence, except as
otherwise provided in Section 8.16(c) hereof. The Borrower shall, and shall
cause each Subsidiary to, preserve and keep in force and effect all licenses,
permits, franchises, approvals, patents, trademarks, trade names, trade styles,
copyrights, and other proprietary rights necessary to the proper conduct of its
business where the failure to do so is reasonably likely to have a Material
Adverse Effect.
Section 8.2. Maintenance of Properties. The Borrower shall, and
shall cause each Subsidiary to, maintain, preserve and keep its property, plant
and equipment in good repair, working order and condition (ordinary wear and
tear excepted) and shall from time to time make all needful and proper repairs,
renewals, replacements, additions and betterments thereto so that at all times
the operation thereof shall be fully preserved and maintained, except to the
extent that, in the reasonable business judgment of such Person, any such
Property is no longer necessary for the proper conduct of the business of such
Person.
Section 8.3. Taxes and Assessments. The Borrower shall duly pay
and discharge, and shall cause each Subsidiary to duly pay and discharge, all
taxes, rates, assessments, fees and governmental charges upon or against it or
its Properties, in each case before the same become delinquent and before
penalties accrue thereon, unless and to the extent that the same are being
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contested in good faith and by appropriate proceedings which prevent
enforcement of the matter under contest and adequate reserves are provided
therefor.
Section 8.4. Insurance. The Borrower shall insure and keep
insured, and shall cause each Subsidiary to insure and keep insured, with
insurance companies with a general policyholder service rating of not less than
A as rated in the most current available Best's Insurance Report, all insurable
Property owned by it which is of a character usually insured by Persons
similarly situated and operating like Properties against loss or damage from
such hazards and risks, and in such amounts, as are insured by Persons
similarly situated and operating like Properties; and the Borrower shall
insure, and shall cause each Subsidiary to insure, such other hazards and risks
(including professional liability, employers' and public liability risks) with
insurance companies with a general policyholder service rating of not less than
A as rated in the most current available Best's Insurance Report as and to the
extent usually insured by Persons similarly situated and conducting similar
businesses. The Borrower shall in any event maintain, and cause each Subsidiary
to maintain, insurance on the Collateral to the extent required by the
Collateral Documents. The Borrower shall, upon the request of the Agent,
furnish to the Agent and each Bank a certificate setting forth in summary form
the nature and extent of the insurance maintained pursuant to this Section.
Section 8.5. Financial Reports. The Borrower shall, and shall
cause each Subsidiary to, maintain a standard system of accounting in
accordance with GAAP and shall furnish to the Agent, each Bank and each of
their duly authorized representatives such information respecting the business
and financial condition of the Borrower and each Subsidiary as the Agent or
such Bank may reasonably request; and without any request, shall furnish to the
Agent and the Banks:
(a) as soon as available, and in any event within 30
days after the last day of each calendar month (except with respect to
January month-end financial statements in each year, in which case the
financial statements required below shall be delivered within 45 days
after the last day of each January), a copy of the consolidated
balance sheet of Borrower and its Subsidiaries as of the last day of
such month and the consolidated statements of income, retained
earnings and cash flows of the Borrower and its Subsidiaries for the
month and for the fiscal year-to-date period then ended, each in
reasonable detail shown in comparative form against the Borrower's
business plan for such year, prepared by the Borrower and certified to
by the Borrower's chief financial officer, or another officer of the
Borrower reasonably acceptable to the Agent;
(b) as soon as available, and in any event within 45
days after the close of each fiscal quarter of each fiscal year of the
Borrower, a copy of the consolidated and consolidating balance sheet
of the Borrower and its Subsidiaries as of the last day of such period
and the consolidated and consolidating statements of income, retained
earnings
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and cash flows of the Borrower and its Subsidiaries for the fiscal
quarter and for the fiscal year-to-date period then ended, each in
reasonable detail showing in comparative form the figures for the
corresponding date and period in the previous fiscal year, prepared by
the Borrower in accordance with GAAP and certified to by the
Borrower's chief financial officer, or another officer of the Borrower
reasonably acceptable to the Agent;
(c) as soon as available, and in any event within 90
days after the close of each fiscal year of the Borrower, a copy of
the consolidated and consolidating balance sheet of the Borrower and
its Subsidiaries as of the last day of the period then ended and the
consolidated and consolidating statements of income, retained earnings
and cash flows of the Borrower and its Subsidiaries for the period
then ended, and accompanying notes thereto, each in reasonable detail
showing in comparative form the figures for the previous fiscal year,
accompanied by an unqualified opinion on the consolidated financial
statements of Ernst & Young (or its successors) or another firm of
independent public accountants of recognized national standing,
selected by the Borrower and reasonably satisfactory to the Required
Banks, to the effect that the consolidated financial statements have
been prepared in accordance with GAAP and present fairly, in all
material respects, in accordance with GAAP the consolidated financial
condition of the Borrower and its Subsidiaries as of the close of such
fiscal year and the results of their operations and cash flows for the
fiscal year then ended and that an examination of such accounts in
connection with such financial statements has been made in accordance
with generally accepted auditing standards and, accordingly, such
examination included such tests of the accounting records and such
other auditing procedures as were considered necessary in the
circumstances;
(d) promptly after the sending or filing thereof, copies
of each financial statement, report, notice or proxy statement sent by
the Borrower or any Subsidiary to its stockholders, and copies of each
regular, periodic or special report, registration statement or
prospectus (including all Form 10-K, Form 10-Q, and Form 8-K reports
and proxy statements) filed by the Borrower or any Subsidiary with any
securities exchange or the Securities and Exchange Commission or any
successor agency;
(e) promptly after receipt thereof, a copy of each audit
made by any regulatory agency of the books and records of the Borrower
or any Subsidiary or of any notice of material noncompliance with any
applicable law, regulation, or guideline relating to the Borrower or
any Subsidiary or any of their respective businesses;
(f) as soon as available, and in any event within 75
days after the end of each fiscal year of the Borrower, a copy of the
Borrower's consolidated and consolidating business plan for the
following fiscal year, such business plan to show the Borrower's
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projected consolidated and consolidating revenues, expenses, and
balance sheet on month-by-month basis, such business plan to be in
reasonable detail prepared by the Borrower and in form reasonably
satisfactory to the Agent which shall include a summary of all
assumptions made in preparing such business plan;
(g) notice of any Change of Control; and
(h) promptly after knowledge thereof shall have come to
the attention of any responsible officer of the Borrower, written
notice of any threatened or pending litigation or governmental
proceeding or labor controversy against the Borrower or any other
Subsidiary which, if adversely determined, is reasonably likely to
have a Material Adverse Effect or of the occurrence of any Default or
Event of Default hereunder.
Each of the financial statements furnished to the Banks pursuant to subsections
(b) and (c) of this Section 8.5 shall be accompanied by a written certificate
in the form attached hereto as Exhibit H signed by the chief financial officer
of the Borrower, or another officer of the Borrower reasonably acceptable to
the Agent, to the effect that to the best of such officer's knowledge and
belief no Default or Event of Default has occurred during the period covered by
such statements or, if any such Default or Event of Default has occurred during
such period, setting forth a description of such Default or Event of Default
and specifying the action, if any, taken by the Borrower or any Subsidiary to
remedy the same. Such certificate shall also set forth the calculations
supporting such statements in respect of Sections 8.7, 8.8, 8.9, 8.10, 8.11 and
8.12 of this Agreement.
Section 8.6. Inspection. The Borrower shall, and shall cause
each Subsidiary to, permit the Agent, each Bank and each of their duly
authorized representatives and agents to visit and inspect any of its
Properties, corporate books and financial records, to examine and make copies
of its books of accounts and other financial records, and to discuss its
affairs, finances and accounts with, and to be advised as to the same by, its
executive officers, employees and independent public accountants (and by this
provision the Borrower hereby authorizes such accountants to discuss with the
Agent and such Banks the finances and affairs of the Borrower and each other
Subsidiary) at such reasonable times and intervals as the Agent or any such
Bank may designate with prior notice to the Borrower.
Section 8.7. Current Ratio. The Borrower shall at all times
maintain a Current Ratio of not less than 1.0 to 1.0.
Section 8.8. Total Funded Debt/Adjusted EBITDA Ratio. As of the
last day of each fiscal quarter of the Borrower ending during the periods
specified below, the Borrower shall not
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permit the Total Funded Debt/Adjusted EBITDA Ratio as of the last day of such
fiscal quarter to be greater than or equal to:
RATIO SHALL NOT BE GREATER
FROM AND INCLUDING TO AND INCLUDING THAN OR EQUAL TO
the date hereof 12/31/98 3.75 to 1.0
01/01/99 06/30/99 3.50 to 1.0
07/01/99 12/31/99 3.25 to 1.0
01/01/2000 at all times thereafter 3.00 to 1.0
Section 8.9. Net Worth. The Borrower shall, at all times,
maintain Net Worth of not less than the sum of (a) $61,717,034, plus (b) 75% of
Net Income for each fiscal quarter of the Borrower ending after March 31, 1998
(i.e., commencing with the fiscal quarter ending June 30, 1998), for which such
Net Income is a positive amount (i.e., there shall be no reduction to the
amount of Net Worth required to be maintained hereunder for any such period in
which Net Income is less than zero), plus (c) 100% of the net proceeds received
by the Borrower from any offering of equity securities of the Borrower received
at any time after the date of this Agreement.
Section 8.10. Interest Coverage Ratio. As of the last day of each
fiscal quarter of the Borrower ending during the periods specified below, the
Borrower shall maintain a ratio of EBITDA for the four fiscal quarters of the
Borrower then ended to Interest Expense for the same four fiscal quarters then
ended of not less than:
RATIO SHALL NOT BE LESS THAN
FROM AND INCLUDING TO AND INCLUDING
the date hereof 12/31/98 3.0 to 1.0
01/01/99 12/31/99 3.25 to 1.0
01/01/2000 and at all times thereafter 3.5 to 1.0
; provided that such ratio shall be computed on June 30, 1998, for the period
of two fiscal quarters then ended, and on September 30, 1998, for the period of
three fiscal quarters then ended.
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Section 8.11. Debt Service Coverage Ratio. As of the last day of
each fiscal quarter of the Borrower ending during the periods specified below,
the Borrower shall maintain a ratio of (a) EBITDA for the four fiscal quarters
of the Borrower then ended less the sum of (i) Capital Expenditures incurred
during such period and (ii) cash payments made during such period with respect
to federal, state, and local income taxes to (b) the aggregate amount of
payments required to be made by the Borrower and its Subsidiaries during the
four fiscal quarters of the Borrower then ended in respect of all principal on
all Indebtedness for Borrowed Money (whether at maturity, as a result of
mandatory sinking fund redemption, mandatory prepayment, acceleration or
otherwise) plus Interest Expense for the same four fiscal quarter period then
ended, of not less than:
RATIO SHALL NOT BE LESS THAN
FROM AND INCLUDING TO AND INCLUDING
the date hereof 12/31/98 1.75 to 1.0
01/01/99 at all times thereafter 2.0 to 1.0
; provided that such ratio shall be computed on June 30, 1998, for the period
of two fiscal quarters then ended, and on September 30, 1998, for the period of
three fiscal quarters then ended.
Section 8.12. Capital Expenditures. The Borrower shall not, nor
shall it permit any other Subsidiary to, incur Capital Expenditures in an
aggregate amount in excess of $6,000,000 during any fiscal year.
Section 8.13. Indebtedness for Borrowed Money. The Borrower shall
not, nor shall it permit any Subsidiary to, issue, incur, assume, create or
have outstanding any Indebtedness for Borrowed Money; provided, however, that
the foregoing shall not restrict nor operate to prevent:
(a) the Obligations of the Borrower and each Subsidiary
owing to the Agent and the Banks hereunder;
(b) purchase money indebtedness and Capitalized Lease
Obligations of the Borrower and of its Subsidiaries in an aggregate
amount not to exceed $1,000,000 at any one time outstanding;
(c) obligations of the Borrower arising out of interest
rate hedging agreements entered into with financial institutions in
the ordinary course of business;
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(d) guaranties expressly permitted by Section 8.15
hereof;
(e) indebtedness assumed in any one or more acquisitions
permitted by Section 8.15(k) hereof, but not incurred in contemplation
of such acquisition, in an aggregate amount not to exceed $1,000,000
at any one time outstanding;
(f) other indebtedness existing on the date of this
Agreement and described on Schedule 8.13 attached hereto and made a
part hereof, as reduced from time to time by repayments thereof;
(g) indebtedness from time to time owing by the Borrower
to any Subsidiary or by any Subsidiary to the Borrower or any other
Subsidiary; and
(h) other indebtedness of the Borrower and its
Subsidiaries not otherwise permitted by this Section in an aggregate
amount not to exceed $5,000,000 at any one time outstanding.
Section 8.14. Liens. The Borrower shall not, nor shall it permit
any other Subsidiary to, create, incur or permit to exist any Lien of any kind
on any Property owned by any such Person; provided, however, that the foregoing
shall not apply to nor operate to prevent:
(a) Liens arising by statute in connection with worker's
compensation, unemployment insurance, old age benefits, social security
obligations, taxes, assessments, statutory obligations or other similar
charges, good faith cash deposits in connection with tenders, contracts
or leases to which the Borrower or any Subsidiary is a party or other
cash deposits required to be made in the ordinary course of business,
provided in each case that the obligation is not for borrowed money and
that the obligation secured is not overdue or, if overdue, is being
contested in good faith by appropriate proceedings which prevent
enforcement of the matter under contest and adequate reserves have been
established therefor;
(b) mechanics', workmen's, materialmen's, landlords',
carriers', or other similar Liens arising in the ordinary course of
business with respect to obligations which are not due or which are
being contested in good faith by appropriate proceedings which prevent
enforcement of the matter under contest;
(c) the pledge of assets for the purpose of securing an
appeal, stay or discharge in the course of any legal proceeding,
provided that the aggregate amount of liabilities of the Borrower and
its Subsidiaries secured by a pledge of assets permitted
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under this subsection, including interest and penalties thereon, if
any, shall not be in excess of $500,000 at any one time outstanding;
(d) the Liens granted in favor of the Agent for the
benefit of the Agent and the Banks pursuant to the Collateral
Documents;
(e) Liens on property of the Borrower, or any Subsidiary
created solely for the purpose of securing indebtedness permitted by
Section 8.13(b) hereof, representing or incurred to finance, refinance
or refund the purchase price of Property, provided that no such Lien
shall extend to or cover other Property of the Borrower or such
Subsidiary other than the respective Property so acquired, and the
principal amount of indebtedness secured by any such Lien shall at no
time exceed the original purchase price of such Property;
(f) easements, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of business which,
in the aggregate, are not substantial in amount and which do not
materially detract from the value of the Property subject thereto or
materially interfere with the ordinary conduct of the business of the
Borrower or any Subsidiary;
(g) Liens on fixed assets acquired by the Borrower or
any Subsidiary, or owned by any newly acquired Subsidiary existing at
the time of acquisition, securing indebtedness permitted by Section
8.13(e) hereof and not incurred in contemplation of such acquisition;
and
(h) any interest or title of a lessor under any
operating lease.
Section 8.15. Investments, Acquisitions, Loans, Advances and
Guaranties. The Borrower shall not, nor shall it permit any Subsidiary to,
directly or indirectly, make, retain or have outstanding any investments
(whether through purchase of stock or obligations or otherwise) in, or loans or
advances (other than for travel advances and other similar cash advances made to
employees in the ordinary course of business) to, any other Person, or acquire
all or any substantial part of the assets or business of any other Person or
division thereof, or be or become liable as endorser, guarantor, surety or
otherwise for any debt, obligation or undertaking of any other Person, or
otherwise agree to provide funds for payment of the obligations of another, or
supply funds thereto or invest therein or otherwise assure a creditor of another
against loss, or apply for or become liable to the issuer of a letter of credit
which supports an obligation of another, or subordinate any claim or demand it
may have to the claim or demand of any other Person; provided, however, that the
foregoing shall not apply to nor operate to prevent:
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(a) investments in direct obligations of the United
States of America or of any agency or instrumentality thereof whose
obligations constitute full faith and credit obligations of the United
States of America, provided that any such obligations shall mature
within one year of the date of issuance thereof;
(b) investments in commercial paper rated at least P-1
by ▇▇▇▇▇'▇ and at least A-1 by S&P maturing within one year of the date
of issuance thereof;
(c) investments in certificates of deposit issued by any
Bank or by any United States commercial bank having capital and surplus
of not less than $100,000,000 which have a maturity of one year or
less;
(d) endorsement of items for deposit or collection of
commercial paper received in the ordinary course of business;
(e) the Borrower's investments from time to time in its
Subsidiaries, and investments made from time to time by a Subsidiary in
one or more of its Subsidiaries;
(f) the guaranty of the Obligations by the Subsidiaries
pursuant to the Guaranties;
(g) guaranties issued by the Borrower or any Subsidiary
guaranteeing or otherwise supporting the repayment of indebtedness of
the Borrower or another Subsidiary otherwise permitted by Section 8.13
hereof;
(h) trade receivables from time to time owing to the
Borrower or any Subsidiary created or acquired in the ordinary course
of its business;
(i) guaranties by the Borrower or any Subsidiary of the
obligations of any other Subsidiary, as lessee, under any real estate
leases entered into in the ordinary course of its business;
(j) ordinary course of business investments in, directly
or indirectly, joint ventures with other Persons formed to provide
products or services in an Eligible Line of Business in an aggregate
amount not to exceed $1,000,000 during any fiscal year of the Borrower;
(k) Permitted Acquisitions and other acquisitions by the
Borrower or any Subsidiary of the stock or assets of Persons primarily
engaged in any Eligible Line of Business if and only so long as (i)
prior to consummation of any such transaction the
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Borrower shall have notified the Banks of the proposed transaction in
reasonable detail as to the terms thereof (including sources and uses
of funds therefor) and the Borrower shall have furnished the Banks
historic and pro forma financial information and compliance
calculations reasonably satisfactory to the Agent demonstrating no
Default or Event of Default exists or, on a pro forma basis, would
occur after giving effect to such transaction, (ii) the acquisition is
not a Hostile Acquisition, (iii) in the case of any acquisition other
than a Permitted Acquisition, the Majority Banks have consented thereto
in writing prior to the Borrower or any Subsidiary entering into such
transaction or a binding commitment to consummate any such transaction,
whichever is earlier (no such consent being required for a Permitted
Acquisition), which consent shall not be unreasonably withheld, and
(iv) no Default or Event of Default exists or would arise immediately
after giving effect to any such transaction;
(l) investments held by any Subsidiary acquired after
the date of this Agreement existing at the time of its acquisition by
the Borrower or other existing Subsidiary and not acquired by such
Subsidiary in contemplation of such acquisition;
(m) intercompany advances made from time to time between
the Borrower and one or more Subsidiaries or between Subsidiaries; and
(n) other investments, loans, advances and guaranties in
addition to those otherwise permitted by this Section (including,
without limitation, any liabilities arising out of "off balance sheet"
transactions), in an aggregate amount not to exceed $500,000 at any one
time outstanding.
In determining the amount of investments, acquisitions, loans, advances and
guaranties permitted under this Section, investments and acquisitions shall
always be taken at the original cost thereof (regardless of any subsequent
appreciation or depreciation therein), loans and advances shall be taken at the
principal amount thereof then remaining unpaid, and guaranties shall be taken
at the amount of the obligations guaranteed thereby.
Section 8.16. Mergers, Consolidations and Sales. The Borrower
shall not, nor shall it permit any Subsidiary to, be a party to any merger or
consolidation, or sell, transfer, lease or otherwise dispose of its Property,
including any disposition of Property as part of a sale and leaseback
transaction, or in any event sell or discount (with or without recourse) any of
its notes or accounts receivable; provided, however, that this Section shall not
apply to nor operate to prevent:
(a) the sale or lease of inventory in the ordinary
course of business, or the lease of equipment or real property in the
ordinary course of business to a provider, or
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professional association of providers, of medical services in the
ordinary course of business (provided any such lease shall be junior
and subordinate to the rights of the Agent in any such asset);
(b) the sale, transfer, lease, or other disposition of
Property of the Borrower or any Subsidiary to one another in the
ordinary course of its business;
(c) a merger of any Subsidiary with and into the
Borrower or any other Subsidiary; provided that, in the case of any
merger involving the Borrower, the Borrower is the corporation
surviving the merger;
(d) the sale of delinquent notes or accounts receivable
in the ordinary course of business for purposes of collection only (and
not for the purpose of any bulk sale or securitization transaction);
(e) the sale, transfer, or other disposition of any
tangible personal property that, in the reasonable business judgment of
the Borrower or its Subsidiary, has become uneconomical, obsolete, or
worn out, and which is disposed of in the ordinary course of business;
and
(f) the sale, transfer, lease, or other disposition of
Property of the Borrower or any Subsidiary aggregating for the Borrower
and its Subsidiaries not more than $1,000,000 during any 12-month
period.
In the event of any merger permitted by Section 8.16(c) above, the Borrower
shall give the Agent and the Banks prior written notice of any such event and,
immediately after giving effect to any such merger, Schedule 6.2 of this
Agreement shall be deemed amended excluding reference to any such Subsidiary
merged out of existence. So long as no Default or Event of Default has occurred
and is continuing or would arise as a result thereof, upon the written request
of the Borrower, the Agent shall release its Lien on any Property sold pursuant
to the foregoing provisions.
Section 8.17. Maintenance of Subsidiaries. The Borrower shall not
assign, sell or transfer, nor shall it permit any Subsidiary to issue, assign,
sell or transfer, any shares of capital stock of a Subsidiary; provided,
however, that the foregoing shall not operate to prevent (i) the Lien on the
capital stock of each Subsidiary granted to the Agent pursuant to the Collateral
Documents, (ii) the issuance, sale and transfer to any person of any shares of
capital stock of a Subsidiary solely for the purpose of qualifying, and to the
extent legally necessary to qualify, such person as a director of such
Subsidiary, and (iii) any transaction permitted by Section 8.16(c) above.
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Section 8.18. Dividends and Certain Other Restricted Payments.
The Borrower shall not, nor shall it permit any Subsidiary to, declare or pay
any dividends on or make any other distributions in respect of any class or
series of its capital stock (other than dividends payable solely in its capital
stock) or directly or indirectly purchase, redeem or otherwise acquire or retire
any of its capital stock; provided, however, that the foregoing shall not
operate to prevent the making of dividends or distributions by any Wholly-Owned
Subsidiary to its parent corporation.
Section 8.19. ERISA. The Borrower shall, and shall cause each
Subsidiary to, promptly pay and discharge all obligations and liabilities
arising under ERISA pertaining to a Plan of a character which if unpaid or
unperformed is reasonably likely to result in the imposition of a Lien against
any of its Properties. The Borrower shall, and shall cause each Subsidiary to,
promptly notify the Agent of (i) the occurrence of any reportable event (as
defined in ERISA) with respect to a Plan, (ii) receipt of any notice from the
PBGC of its intention to seek termination of any Plan or appointment of a
trustee therefor, (iii) its intention to terminate or withdraw from any Plan,
and (iv) the occurrence of any event with respect to any Plan which would result
in the incurrence by the Borrower or any Subsidiary of any material liability,
fine or penalty, or any material increase in the contingent liability of the
Borrower or any Subsidiary with respect to any post-retirement Welfare Plan
benefit.
Section 8.20. Compliance with Laws. The Borrower shall, and shall
cause each Subsidiary to, comply in all respects with the requirements of all
federal, state and local laws, rules, regulations, ordinances and orders
applicable to or pertaining to its Properties or business operations, where any
such non-compliance, individually or in the aggregate, is reasonably likely to
have a Material Adverse Effect or is reasonably likely to result in a Lien upon
any of their Property.
Section 8.21. Burdensome Contracts With Affiliates. The Borrower
shall not, nor shall it permit any Subsidiary to, enter into any contract,
agreement or business arrangement with any of its Affiliates on terms and
conditions which are less favorable to the Borrower or such Subsidiary than
would be usual and customary in similar contracts, agreements or business
arrangements between Persons not affiliated with each other.
Section 8.22. No Changes in Fiscal Year. The Borrower shall not,
nor shall it permit any Subsidiary to, change its fiscal year from its present
basis without the prior written consent of the Required Banks.
Section 8.23. Formation of Subsidiaries. Promptly upon the
formation or acquisition of any Subsidiary, the Borrower shall provide the Agent
and the Banks written notice thereof and shall do such acts and things as are
required of it to comply with Section 4 hereof, and then and
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thereafter Schedule 6.2 of this Agreement shall be deemed amended from and after
such date to include reference to any such Subsidiary.
Section 8.24. Change in the Nature of Business. The Borrower
shall not, nor shall it permit any Subsidiary to, engage in any business or
activity if as a result the general nature of the business of the Borrower or
any Subsidiary would be changed in any material respect from the general nature
of the business engaged in by it as of the date of this Agreement or as of the
date such Person becomes a Subsidiary hereunder.
Section 8.25. Change in Capital Structure. Except for the
authorization and/or issuance of additional common stock, the Borrower shall
not change its capital structure or authorize or issue any other equity
securities (other than warrants and/or options to acquire the Borrower's common
stock) without the prior written consent of the Required Banks.
Section 8.26. Use of Loan Proceeds. The Borrower shall use the
credit extended under this Agreement solely for the purposes set forth in, or
otherwise permitted by, Section 6.4 hereof.
Section 8.27. Restrictions on Subsidiary Distributions. Except as
provided herein, the Borrower shall not, nor shall it permit any Subsidiary to,
directly or indirectly create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of the Borrower or any Subsidiary to: (a) guarantee the Obligations and grant
Liens on its assets to the Agent for the benefit of the Banks as required by
Section 4 hereof; (b) in the case of any Subsidiary, pay dividends or make any
other distribution on any of such Subsidiary's capital stock or other equity
interests owned by the Borrower or any Subsidiary; (c) pay any indebtedness owed
to the Borrower or any Subsidiary; (d) make loans or advances to the Borrower or
any Subsidiary; or (e) transfer any of its property or assets to the Borrower or
any Subsidiary.
Section 8.28. Limits on Certain Non-Material Subsidiaries. So
long as any one or more of Block Vision of Texas, Inc. ("BVT"), Vision Insurance
Plan of America, Inc. ("VIPA"), Vision Twenty-One Surgery Center, Ltd. ("Surgery
Center"), or Vision Twenty-One Surgery Center-Largo, Ltd. ("Surgery
Center-Largo"), is a Subsidiary, directly or indirectly, of the Borrower, the
Borrower shall not permit the total combined tangible assets of BVT, VIPA,
Surgery Center and Surgery Center-Largo to have a book value in excess of 2.5%
of the Borrower's consolidated total tangible assets or the combined gross
revenues of BVT, VIPA, Surgery Center and Surgery Center-Largo to be in excess
of 2.5% of the Borrower's consolidated total revenues.
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Section 8.29. Interest Rate Protection. Prior to September 30,
1998, the Borrower will hedge its interest rate risk on $35,000,000 of the
principal amount outstanding on the Term B Loans for a minimum of three years,
through the use of one or more Fixed Rate Loans, interest rate swaps, interest
rate caps, interest rate collars or other recognized interest rate hedging
arrangements (collectively, "Hedging Arrangements"), with all of the foregoing
to effectively limit the amount of interest that the Borrower must pay on
notional amounts of not less than such portion of the Term B Loans to not more
than a rate acceptable to the Agent in its discretion for a period ending no
earlier than June 30, 2001. Any Hedging Arrangements entered into after the date
of this Agreement shall be on terms and conditions, and with such parties,
reasonably acceptable to the Agent. If the Borrower enters into any Hedging
Arrangements with any Bank, the Borrower's obligations to such Bank in
connection with such Hedging Arrangements do not constitute usage of the
Commitments of such Bank.
Section 8.30. Year 2000 Compliance. The Borrower shall take all
reasonable actions necessary and commit adequate resources to assure that its
computer-based and other systems (and those of all Subsidiaries) are able to
effectively process data, including dates before, on and after January 1, 2000,
without experiencing any Year 2000 Problems that could cause a Material Adverse
Effect. At the request of the Agent or the Required Banks, the Borrower will
provide the Banks with assurances and substantiations (including, but not
limited to, the results of internal or external reports prepared in the ordinary
course of business or at the request of the Agent or the Required Banks)
reasonably acceptable to the Agent and the Required Banks as to the capability
of the Borrower and its Subsidiaries to conduct its and their businesses and
operations before, on, and after January 1, 2000, without experiencing a Year
2000 Problem that, individually or in the aggregate, is reasonably likely to
have a Material Adverse Effect. In addition, the Borrower hereby agrees that it
shall engage an independent systems consultant selected by the Borrower and
reasonably satisfactory to the Agent to review the adequacy of the primary
computer and related reporting systems used with respect to the managed care and
financial reporting aspects of the business of the Borrower and its Subsidiaries
(including, without limitation, the integration of physician practices and of
the operations and capacity for growth of the Borrower and its Subsidiaries in
light of their targeted expansion and growth) and the risks of any Year 2000
Problems affecting the Borrower or any Subsidiary which, individually or in the
aggregate, are reasonably likely to have a Material Adverse Effect (herein, the
"Systems and Y2K Report"). The Systems and Y2K Report shall be delivered to the
Banks on or before September 30, 1998, or, if earlier, not less than ten (10)
Business Days prior to any request for an advance of any Term A Loans or Term B
Loans which, when made, would cause the original aggregate principal amount of
the Term A Loans and Term B Loans (determined exclusive of the Term B Loans made
on the date hereof) to exceed $10,000,000. In the event such Systems and Y2K
Report discloses any Year 2000 Problems or any other deficiencies in the
computer and related reporting systems, operations or capacity for growth of the
Borrower and its Subsidiaries in light of their targeted expansion and growth
which, individually or in the
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aggregate, are reasonably likely to have a Material Adverse Effect, the Term A
Credit Commitments of the Banks shall be suspended (and no Term A Loans shall be
available to the Borrower hereunder) until such Year 2000 Problems or other
computer, reporting, operating or capacity deficiencies are cured to the
reasonable satisfaction of the Required Banks.
Section 8.31. Total Funded Debt to Total Capitalization. The
Borrower shall not, at any time during each of the periods specified below,
permit the ratio of Total Funded Debt to Total Capitalization to exceed:
FROM AND INCLUDING TO AND INCLUDING RATIO SHALL NOT EXCEED
the date hereof 06/30/99 .55 to 1.0
07/01/99 and at all times thereafter .50 to 1.0
Section 8.32. Practice Base. (a) Physician Base. The number of
physicians employed or covered by management service agreements with the
Borrower or any Subsidiary as of the end of any fiscal quarter shall not be less
than 80% of the number of physicians so employed or covered as of the date
hereof.
(b) Patient Base. The number of managed care lives covered by
management service agreements with the Borrower or any Subsidiary as of the end
of any fiscal quarter shall not be less than 80% of the number of managed care
lives covered as of the date hereof.
SECTION 9. EVENTS OF DEFAULT AND REMEDIES.
Section 9.1. Events of Default. Any one or more of the following
shall constitute an "Event of Default" hereunder:
(a) default in the payment when due of all or any part
of the principal of any Note (whether at the stated maturity thereof or
at any other time provided for in this Agreement), or default for a
period of 3 Business Days in the payment when due of any interest on
any Note or of any Reimbursement Obligation or of any fee or other
Obligation payable hereunder or under any other Loan Document;
(b) default in the observance or performance of any
covenant set forth in Section 8.5, 8.7, 8.8, 8.9, 8.10, 8.11, 8.12,
8.13, 8.15, 8.16, 8.17, 8.18, 8.24, 8.25, 8.26, 8.27, 8.31, or 8.32
hereof or of any provision in any Loan Document dealing with the
use, disposition or remittance of the proceeds of Collateral or
requiring the maintenance of insurance thereon;
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(c) default in the observance or performance of any
other provision hereof or of any other Loan Document which is not
remedied within 30 days after the earlier of (i) the date on which such
failure shall first become known to any executive officer of the
Borrower or (ii) written notice thereof is given to the Borrower by the
Agent;
(d) any representation or warranty made herein or in any
other Loan Document or in any certificate furnished to the Agent or the
Banks pursuant hereto or thereto or in connection with any transaction
contemplated hereby or thereby proves untrue in any material respect as
of the date of the issuance or making or deemed making thereof;
(e) any event occurs or condition exists (other than
those described in subsections (a) through (d) above) which is
specified as an event of default under any of the other Loan Documents,
or any of the Loan Documents, or any material provisions thereof, shall
for any reason not be or shall cease to be in full force and effect or
is declared to be null and void, or any of the Collateral Documents
shall for any reason fail to create a valid and perfected first
priority Lien in favor of the Agent in any Collateral purported to be
covered thereby except as expressly permitted by the terms thereof, or
the Borrower or any Subsidiary takes any action for the purpose of
terminating, repudiating or rescinding any Loan Document executed by it
or any of its obligations thereunder;
(f) default shall occur under any Indebtedness for
Borrowed Money aggregating in excess of $500,000 issued, assumed or
guaranteed by the Borrower or any Subsidiary, or under any indenture,
agreement or other instrument under which the same may be issued, and
such default shall continue for a period of time sufficient to permit
the acceleration of the maturity of any such Indebtedness for Borrowed
Money (whether or not such maturity is in fact accelerated), or any
such Indebtedness for Borrowed Money shall not be paid when due
(whether by demand, lapse of time, acceleration or otherwise);
(g) any judgment or judgments, writ or writs or warrant
or warrants of attachment, or any similar process or processes in an
aggregate amount in excess of $500,000 in excess of any applicable
insurance coverage shall be entered or filed against any of the
Borrower or any Subsidiary, or against any of its Property, and which
remains undischarged, unvacated, unbonded or unstayed for a period of
30 days;
(h) the Borrower or any Subsidiary, or any member of its
Controlled Group, shall fail to pay when due an amount or amounts
aggregating in excess $500,000 which it shall have become liable to pay
to the PBGC or to a Plan under Title IV of ERISA; or notice of intent
to terminate a Plan or Plans having aggregate Unfunded Vested
Liabilities in excess of $500,000 (collectively, a "Material Plan")
shall be filed under Title IV of
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ERISA by the Borrower or any Subsidiary, or any other member of its
Controlled Group, any plan administrator or any combination of the
foregoing; or the PBGC shall institute proceedings under Title IV of
ERISA to terminate or to cause a trustee to be appointed to administer
any Material Plan or a proceeding shall be instituted by a fiduciary of
any Material Plan against the Borrower or any Subsidiary, or any member
of its Controlled Group, to enforce Section 515 or 4219(c)(5) of ERISA
and such proceeding shall not have been dismissed within 30 days
thereafter; or a condition shall exist by reason of which the PBGC
would be entitled to obtain a decree adjudicating that any Material
Plan must be terminated;
(i) the Borrower or any Subsidiary shall (i) have
entered involuntarily against it an order for relief under the United
States Bankruptcy Code, as amended, (ii) not pay, or admit in writing
its inability to pay, its debts generally as they become due, (iii)
make an assignment for the benefit of creditors, (iv) apply for, seek,
consent to, or acquiesce in, the appointment of a receiver, custodian,
trustee, examiner, liquidator or similar official for it or any
substantial part of its Property, (v) institute any proceeding seeking
to have entered against it an order for relief under the United States
Bankruptcy Code, as amended, to adjudicate it insolvent, or seeking
dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail
to file an answer or other pleading denying the material allegations of
any such proceeding filed against it, (vi) take any corporate action in
furtherance of any matter described in parts (i) through (v) above, or
(vii) fail to contest in good faith any appointment or proceeding
described in Section 9.1(j) hereof;
(j) a custodian, receiver, trustee, examiner, liquidator
or similar official shall be appointed for the Borrower or any
Subsidiary or any substantial part of any of its Property, or a
proceeding described in Section 9.1(i)(v) shall be instituted against
the Borrower or any Subsidiary, and such appointment continues
undischarged or such proceeding continues undismissed or unstayed for a
period of 30 days; or
(k) one or more long-term management agreements pursuant
to which the Borrower or any Subsidiary provides management and/or
administrative services is terminated or cancelled prior to its
scheduled termination date (whether as a result of a breach by the
Borrower or such Subsidiary thereunder or otherwise) or any advisory
agreement pursuant to which one or more Persons provide advisory
services to the Borrower or any Subsidiary in connection with
identifying potential Acquisitions is terminated or cancelled prior to
its scheduled termination date (whether as a result of a breach by the
Borrower or such Subsidiary thereunder or otherwise) and, in the
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reasonable judgment of the Required Banks, any such termination or
cancellation is reasonably likely to have a Material Adverse Effect.
Section 9.2. Non-Bankruptcy Defaults. When any Event of Default
other than those described in subsection (i) or (j) of Section 9.1 hereof has
occurred and is continuing, the Agent shall, by written notice to the Borrower:
(a) if so directed by the Required Banks, terminate the remaining Commitments
and all other obligations of the Banks hereunder on the date stated in such
notice (which may be the date thereof); (b) if so directed by the Required
Banks, declare the principal of and the accrued interest on all outstanding
Notes to be forthwith due and payable and thereupon all outstanding Notes,
including both principal and interest thereon, shall be and become immediately
due and payable together with all other amounts payable under the Loan Documents
without further demand, presentment, protest or notice of any kind; and (c) if
so directed by the Required Banks, demand that the Borrower immediately pay to
the Agent the full amount then available for drawing under each or any Letter of
Credit, and the Borrower agrees to immediately make such payment and
acknowledges and agrees that the Banks would not have an adequate remedy at law
for failure by the Borrower to honor any such demand and that the Agent, for the
benefit of the Banks, shall have the right to require the Borrower to
specifically perform such undertaking whether or not any drawings or other
demands for payment have been made under any Letter of Credit. The Agent, after
giving notice to the Borrower pursuant to Section 9.1(c) or this Section 9.2,
shall also promptly send a copy of such notice to the other Banks, but the
failure to do so shall not impair or annul the effect of such notice.
Section 9.3. Bankruptcy Defaults. When any Event of Default
described in subsections (i) or (j) of Section 9.1 hereof has occurred and is
continuing, then all outstanding Notes shall immediately become due and payable
together with all other amounts payable under the Loan Documents without
presentment, demand, protest or notice of any kind, the obligation of the Banks
to extend further credit pursuant to any of the terms hereof shall immediately
terminate and the Borrower shall immediately pay to the Agent the full amount
then available for drawing under all outstanding Letters of Credit, the Borrower
acknowledging and agreeing that the Banks would not have an adequate remedy at
law for failure by the Borrower to honor any such demand and that the Banks, and
the Agent on their behalf, shall have the right to require the Borrower to
specifically perform such undertaking whether or not any draws or other demands
for payment have been made under any of the Letters of Credit.
Section 9.4. Collateral for Undrawn Letters of Credit. (a) If
the prepayment of the amount available for drawing under any or all outstanding
Letters of Credit is required under Section 1.9(b) or under Section 9.2 or 9.3
above, the Borrower shall forthwith pay the amount required to be so prepaid, to
be held by the Agent as provided in subsection (b) below.
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(b) All amounts prepaid pursuant to subsection (a) above shall be
held by the Agent in a separate collateral account (such account, and the credit
balances, properties and any investments from time to time held therein, and any
substitutions for such account, any certificate of deposit or other instrument
evidencing any of the foregoing and all proceeds of and earnings on any of the
foregoing being collectively called the "Account") as security for, and for
application by the Agent (to the extent available) to, the reimbursement of any
payment under any Letter of Credit then or thereafter made by the Agent, and to
the payment of the unpaid balance of any Loans and all other Obligations. The
Account shall be held in the name of and subject to the exclusive dominion and
control of the Agent for the benefit of the Agent and the Banks. If and when
requested by the Borrower, the Agent shall invest funds held in the Account from
time to time in direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America with a remaining maturity of one year or less, provided that the Agent
is irrevocably authorized to sell investments held in the Account when and as
required to make payments out of the Account for application to amounts due and
owing from the Borrower to the Agent or Banks; provided, however, that if (i)
the Borrower shall have made payment of all such obligations referred to in
subsection (a) above, (ii) all relevant preference or other disgorgement periods
relating to the receipt of such payments have passed, and (iii) no Letters of
Credit, Commitments, Loans or other Obligations remain outstanding hereunder,
then the Agent shall release to the Borrower any remaining amounts held in the
Account.
Section 9.5. Notice of Default. The Agent shall give notice to
the Borrower under Section 9.1(c) hereof promptly upon being requested to do so
by any Bank and shall thereupon notify all the Banks thereof.
Section 9.6. Expenses. The Borrower agrees to pay to the Agent
and each Bank, and any other holder of any Note outstanding hereunder, all
expenses reasonably incurred or paid by the Agent and such Bank or any such
holder, including reasonable attorneys' fees and court costs, in connection with
any Default or Event of Default by the Borrower hereunder or in connection with
the enforcement of any of the Loan Documents.
SECTION 10. CHANGE IN CIRCUMSTANCES.
Section 10.1. Change of Law. Notwithstanding any other provisions
of this Agreement or any Note, if at any time any change in applicable law or
regulation or in the interpretation thereof makes it unlawful for any Bank to
make or continue to maintain any Eurodollar Loans or to perform its obligations
as contemplated hereby, such Bank shall promptly give notice thereof to the
Borrower and such Bank's obligations to make or maintain Eurodollar Loans under
this Agreement shall terminate until it is no longer unlawful for such Bank to
make or maintain Eurodollar Loans. The Borrower shall prepay on demand the
outstanding principal
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amount of any such affected Eurodollar Loans, together with all interest accrued
thereon and all other amounts then due and payable to such Bank under this
Agreement; provided, however, subject to all of the terms and conditions of this
Agreement, the Borrower may then elect to borrow the principal amount of the
affected Eurodollar Loans from such Bank by means of Base Rate Loans from such
Bank, which Base Rate Loans shall not be made ratably by the Banks but only from
such affected Bank.
Section 10.2. Unavailability of Deposits or Inability to
Ascertain, or Inadequacy of, LIBOR. If on or prior to the first day of any
Interest Period for any Borrowing of Eurodollar Loans:
(a) the Agent determines that deposits in U.S. Dollars
(in the applicable amounts) are not being offered to it in the
interbank eurodollar market for such Interest Period, or that by reason
of circumstances affecting the interbank eurodollar market adequate and
reasonable means do not exist for ascertaining the applicable LIBOR, or
(b) the Required Banks advise the Agent that (i) LIBOR
as determined by the Agent will not adequately and fairly reflect the
cost to such Banks of funding their Eurodollar Loans for such Interest
Period or (ii) that the making or funding of Eurodollar Loans become
impracticable,
then the Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Agent notifies the Borrower that the circumstances
giving rise to such suspension no longer exist, the obligations of the Banks to
make Eurodollar Loans shall be suspended.
Section 10.3. Increased Cost and Reduced Return. (a) If, on or
after the date hereof, the adoption of any applicable law, rule or regulation,
or any change therein, or any change in the interpretation or administration
thereof by any governmental authority, central bank or comparable agency charged
with the interpretation or administration thereof, or compliance by any Bank (or
its Lending Office) with any request or directive (whether or not having the
force of law) of any such authority, central bank or comparable agency:
(i) shall subject any Bank (or its Lending Office) to
any tax, duty or other charge with respect to its Eurodollar Loans or
Fixed Rate Loans, its Notes, its Letter(s) of Credit, or its
participation in any thereof, any Reimbursement Obligations owed to it
or its obligation to make Eurodollar Loans or Fixed Rate Loans, issue a
Letter of Credit, or to participate therein, or shall change the basis
of taxation of payments to any Bank (or its Lending Office) of the
principal of or interest on its Eurodollar Loans, Fixed Rate Loans,
Letter(s) of Credit, or participations therein or any other amounts due
under this Agreement or any other Loan Document in respect of its
Eurodollar Loans or Fixed Rate
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Loans, Letter(s) of Credit, any participation therein, any
Reimbursement Obligations owed to it, or its obligation to make
Eurodollar Loans or Fixed Rate Loans, or issue a Letter of Credit, or
acquire participations therein (except for changes in the rate of tax
on the overall net income of such Bank or its Lending Office imposed by
the jurisdiction in which such Bank's principal executive office or
Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the Federal
Reserve System, but excluding with respect to any Eurodollar Loans or
Fixed Rate Loans any such requirement included in an applicable
Eurodollar Reserve Percentage) against assets of, deposits with or for
the account of, or credit extended by, any Bank (or its Lending Office)
or shall impose on any Bank (or its Lending Office) or on the interbank
market any other condition affecting its Eurodollar Loans or Fixed Rate
Loans, its Notes, its Letter(s) of Credit, or its participation in any
thereof, any Reimbursement Obligation owed to it, or its obligation to
make Eurodollar Loans or Fixed Rate Loans, or to issue a Letter of
Credit, or to participate therein;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Eurodollar Loan or Fixed Rate
Loan, issuing or maintaining a Letter of Credit, or participating therein, or
to reduce the amount of any sum received or receivable by such Bank (or its
Lending Office) under this Agreement or under any other Loan Document with
respect thereto, by an amount deemed by such Bank to be material, then, within
15 days after demand by such Bank (with a copy to the Agent), the Borrower
shall be obligated to pay to such Bank such additional amount or amounts as
will compensate such Bank for such increased cost or reduction.
(b) If, after the date hereof, any Bank or the Agent shall have
determined that the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any Bank (or its Lending Office) with any request or directive regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has had the effect of reducing the rate of
return on such Bank's capital as a consequence of its obligations hereunder to a
level below that which such Bank could have achieved but for such adoption,
change or compliance (taking into consideration such Bank's policies with
respect to capital adequacy) by an amount deemed by such Bank to be material,
then from time to time, within 15 days after demand by such Bank (with a copy to
the Agent), the Borrower shall pay to such Bank such additional amount or
amounts as will compensate such Bank for such reduction.
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(c) A certificate of a Bank claiming compensation under this
Section 9.3 and setting forth the additional amount or amounts to be paid to it
hereunder shall be conclusive if reasonably determined. In determining such
amount, such Bank may use any reasonable averaging and attribution methods.
Section 10.4. Lending Offices. Each Bank may, at its option,
elect to make its Loans hereunder at the branch, office or affiliate specified
on the appropriate signature page hereof (each a "Lending Office") for each type
of Loan available hereunder or at such other of its branches, offices or
affiliates as it may from time to time elect and designate in a written notice
to the Borrower and the Agent.
Section 10.5. Discretion of Bank as to Manner of Funding.
Notwithstanding any other provision of this Agreement, each Bank shall be
entitled to fund and maintain its funding of all or any part of its Loans in any
manner it sees fit, it being understood, however, that for the purposes of this
Agreement all determinations hereunder with respect to Eurodollar Loans shall be
made as if each Bank had actually funded and maintained each Eurodollar Loan
through the purchase of deposits in the interbank eurodollar market having a
maturity corresponding to such Loan's Interest Period and bearing an interest
rate equal to LIBOR for such Interest Period.
SECTION 11. THE AGENT.
Section 11.1. Appointment and Authorization of Agent. Each Bank
hereby appoints Bank of Montreal as the Agent under the Loan Documents and
hereby authorizes the Agent to take such action as Agent on its behalf and to
exercise such powers under the Loan Documents as are delegated to the Agent by
the terms thereof, together with such powers as are reasonably incidental
thereto. The Banks expressly agree that the Agent is not acting as a fiduciary
of the Banks in respect of the Loan Documents, the Borrower or otherwise, and
nothing herein or in any of the other Loan Documents shall result in any duties
or obligations on the Agent or any of the Banks except as expressly set forth
herein.
Section 11.2. Agent and its Affiliates. The Agent shall have the
same rights and powers under this Agreement and the other Loan Documents as any
other Bank and may exercise or refrain from exercising such rights and power as
though it were not the Agent, and the Agent and its affiliates may accept
deposits from, lend money to, and generally engage in any kind of business with
the Borrower or any Affiliate of the Borrower as if it were not the Agent under
the Loan Documents. The term "Bank" as used herein and in all other Loan
Documents, unless the context otherwise clearly requires, includes the Agent in
its individual capacity as a Bank. References in Section 1 hereof to the Agent's
Loans, or to the amount owing to the Agent for which an interest rate is being
determined, refer to the Agent in its individual capacity as a Bank.
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Section 11.3. Action by Agent. If the Agent receives from the
Borrower a written notice of an Event of Default pursuant to Section 8.5 hereof,
the Agent shall promptly give each of the Banks written notice thereof. The
obligations of the Agent under the Loan Documents are only those expressly set
forth therein. Without limiting the generality of the foregoing, the Agent shall
not be required to take any action hereunder with respect to any Default or
Event of Default, except as expressly provided in Sections 9.2 and 9.5. Upon the
occurrence of an Event of Default, the Agent shall take such action to enforce
its Lien on the Collateral and to preserve and protect the Collateral as may be
directed by the Required Banks. Unless and until the Required Banks give such
direction, the Agent may (but shall not be obligated to) take or refrain from
taking such actions as it deems appropriate and in the best interest of all the
Banks. In no event, however, shall the Agent be required to take any action in
violation of applicable law or of any provision of any Loan Document, and the
Agent shall in all cases be fully justified in failing or refusing to act
hereunder or under any other Loan Document unless it first receives any further
assurances of its indemnification from the Banks that it may require, including
prepayment of any related expenses and any other protection it requires against
any and all costs, expense, and liability which may be incurred by it by reason
of taking or continuing to take any such action. The Agent shall be entitled to
assume that no Default or Event of Default exists unless notified in writing to
the contrary by a Bank or the Borrower. In all cases in which the Loan Documents
do not require the Agent to take specific action, the Agent shall be fully
justified in using its discretion in failing to take or in taking any action
thereunder. Any instructions of the Required Banks, or of any other group of
Banks called for under the specific provisions of the Loan Documents, shall be
binding upon all the Banks and the holders of the Obligations.
Section 11.4. Consultation with Experts. The Agent may consult
with legal counsel, independent public accountants and other experts selected by
it and shall not be liable for any action taken or omitted to be taken by it in
good faith in accordance with the advice of such counsel, accountants or
experts.
Section 11.5. Liability of Agent; Credit Decision. Neither the
Agent nor any of its directors, officers, agents, or employees shall be liable
for any action taken or not taken by it in connection with the Loan Documents:
(i) with the consent or at the request of the Required Banks or (ii) in the
absence of its own gross negligence or willful misconduct. Neither the Agent nor
any of its directors, officers, agents or employees shall be responsible for or
have any duty to ascertain, inquire into or verify: (i) any statement, warranty
or representation made in connection with this Agreement, any other Loan
Document or any Credit Event; (ii) the performance or observance of any of the
covenants or agreements of the Borrower or any Subsidiary contained herein or in
any other Loan Document; (iii) the satisfaction of any condition specified in
Section 7 hereof, except receipt of items required to be delivered to the Agent;
or (iv) the validity, effectiveness, genuineness, enforceability, perfection,
value, worth or collectibility hereof or of any other Loan Document or of any
other documents or writing furnished in
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connection with any Loan Document or of any Collateral; and the Agent makes no
representation of any kind or character with respect to any such matter
mentioned in this sentence. The Agent may execute any of its duties under any of
the Loan Documents by or through employees, agents, and attorneys-in-fact and
shall not be answerable to the Banks, the Borrower, or any other Person for the
default or misconduct of any such agents or attorneys-in-fact selected with
reasonable care, except for its gross negligence or willful misconduct. The
Agent shall not incur any liability by acting in reliance upon any notice,
consent, certificate, other document or statement (whether written or oral)
believed by it to be genuine or to be sent by the proper party or parties. In
particular and without limiting any of the foregoing, the Agent shall have no
responsibility for confirming the accuracy of any compliance certificate or
other document or instrument received by it under the Loan Documents. The Agent
may treat the payee of any Note as the holder thereof until written notice of
transfer shall have been filed with the Agent signed by such payee in form
satisfactory to the Agent. Each Bank acknowledges that it has independently and
without reliance on the Agent or any other Bank, and based upon such
information, investigations and inquiries as it deems appropriate, made its own
credit analysis and decision to extend credit to the Borrower in the manner set
forth in the Loan Documents. It shall be the responsibility of each Bank to keep
itself informed as to the creditworthiness of the Borrower and its Subsidiaries,
and the Agent shall have no liability to any Bank with respect thereto.
Section 11.6. Indemnity. The Banks shall ratably, in accordance
with their respective Percentages, indemnify and hold the Agent, and its
directors, officers, employees, agents and representatives harmless from and
against any liabilities, losses, costs or expenses suffered or incurred by it
under any Loan Document or in connection with the transactions contemplated
thereby, regardless of when asserted or arising, except to the extent they are
promptly reimbursed for the same by the Borrower and except to the extent that
any event giving rise to a claim was caused by the gross negligence or willful
misconduct of the party seeking to be indemnified. The obligations of the Banks
under this Section shall survive termination of this Agreement.
Section 11.7. Resignation of Agent and Successor Agent. The Agent
may resign at any time by giving written notice thereof to the Banks and the
Borrower. Upon any such resignation of the Agent, the Required Banks shall have
the right to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Required Banks, and shall have accepted such appointment,
within 30 days after the retiring Agent's giving of notice of resignation then
the retiring Agent may, on behalf of the Banks, appoint a successor Agent, which
shall be any Bank hereunder or any commercial bank organized under the laws of
the United States of America or of any State thereof and having a combined
capital and surplus of at least $200,000,000. Upon the acceptance of its
appointment as the Agent hereunder, such successor Agent shall thereupon succeed
to and become vested with all the rights and duties of the retiring Agent under
the Loan Documents, and the retiring Agent shall be discharged from its duties
and obligations thereunder. After any retiring Agent's resignation hereunder as
Agent, the
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provisions of this Section 11 and all protective provisions of the other Loan
Documents shall inure to its benefit as to any actions taken or omitted to be
taken by it while it was Agent, but no successor Agent shall in any event be
liable or responsible for any actions of its predecessor. If the Agent resigns
and no successor is appointed, the rights and obligations of such Agent shall be
automatically assumed by the Required Banks and (i) the Borrower shall be
directed to make all payments due each Bank hereunder directly to such Bank and
(ii) the Agent's rights in the Collateral Documents shall be assigned without
representation, recourse or warranty to the Banks as their interests may appear.
SECTION 12. MISCELLANEOUS.
Section 12.1. Withholding Taxes. (a) Payments Free of
Withholding. Except as otherwise required by law and subject to Section 12.1(b)
hereof, each payment by the Borrower under this Agreement or the other Loan
Documents shall be made without withholding for or on account of any present or
future taxes (other than overall net income taxes on the recipient) imposed by
or within the jurisdiction in which the Borrower is domiciled, any jurisdiction
from which the Borrower makes any payment, or (in each case) any political
subdivision or taxing authority thereof or therein. If any such withholding is
so required, the Borrower shall make the withholding, pay the amount withheld to
the appropriate governmental authority before penalties attach thereto or
interest accrues thereon and forthwith pay such additional amount as may be
necessary to ensure that the net amount actually received by each Bank and the
Agent free and clear of such taxes (including such taxes on such additional
amount) is equal to the amount which that Bank or the Agent (as the case may be)
would have received had such withholding not been made. If the Agent or any Bank
pays any amount in respect of any such taxes, penalties or interest, the
Borrower shall reimburse the Agent or such Bank for that payment on demand in
the currency in which such payment was made. If the Borrower pays any such
taxes, penalties or interest, it shall deliver official tax receipts evidencing
that payment or certified copies thereof to the Bank or Agent on whose account
such withholding was made (with a copy to the Agent if not the recipient of the
original) on or before the thirtieth day after payment.
(b) U.S. Withholding Tax Exemptions. Each Bank that is not a
United States person (as such term is defined in Section 7701(a)(30) of the
Code) shall submit to the Borrower and the Agent on or before the earlier of the
date the initial Borrowing is made hereunder and 30 days after the date hereof,
two duly completed and signed copies of either Form 1001 (relating to such Bank
and entitling it to a complete exemption from withholding under the Code on all
amounts to be received by such Bank, including fees, pursuant to the Loan
Documents and the Loans) or Form 4224 (relating to all amounts to be received by
such Bank, including fees, pursuant to the Loan Documents and the Loans) of the
United States Internal Revenue Service. Thereafter and from time to time, each
Bank shall submit to the Borrower and the Agent such additional duly completed
and signed copies of one or the other of such Forms (or such successor forms as
shall
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be adopted from time to time by the relevant United States taxing authorities)
as may be (i) requested by the Borrower in a written notice, directly or through
the Agent, to such Bank and (ii) required 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 Bank, including fees, pursuant to
the Loan Documents or the Loans.
(c) Inability of Bank to Submit Forms. If any Bank determines,
as a result of any change in applicable law, regulation or treaty, or in any
official application or interpretation thereof, that it is unable to submit to
the Borrower or the Agent any form or certificate that such Bank is obligated to
submit pursuant to subsection (b) of this Section 12.1 or that such Bank is
required to withdraw or cancel any such form or certificate previously submitted
or any such form or certificate otherwise becomes ineffective or inaccurate,
such Bank shall promptly notify the Borrower and Agent of such fact and the Bank
shall to that extent not be obligated to provide any such form or certificate
and will be entitled to withdraw or cancel any affected form or certificate, as
applicable.
Section 12.2. No Waiver, Cumulative Remedies. No delay or failure
on the part of the Agent or any Bank or on the part of the holder or holders of
any of the Obligations in the exercise of any power or right under any Loan
Document shall operate as a waiver thereof or as an acquiescence in any default,
nor shall any single or partial exercise of any power or right preclude any
other or further exercise thereof or the exercise of any other power or right.
The rights and remedies hereunder of the Agent, the Banks and of the holder or
holders of any of the Obligations are cumulative to, and not exclusive of, any
rights or remedies which any of them would otherwise have.
Section 12.3. Non-Business Days. If any payment hereunder becomes
due and payable on a day which is not a Business Day, the due date of such
payment shall be extended to the next succeeding Business Day on which date such
payment shall be due and payable. In the case of any payment of principal
falling due on a day which is not a Business Day, interest on such principal
amount shall continue to accrue during such extension at the rate per annum then
in effect, which accrued amount shall be due and payable on the next scheduled
date for the payment of interest.
Section 12.4. Documentary Taxes. The Borrower agrees to pay on
demand any documentary, stamp or similar taxes payable in respect of this
Agreement or any other Loan Document, including interest and penalties, in the
event any such taxes are assessed, irrespective of when such assessment is made
and whether or not any credit is then in use or available hereunder.
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Section 12.5. Survival of Representations. All representations
and warranties made herein or in any other Loan Document or in certificates
given pursuant hereto or thereto shall survive the execution and delivery of
this Agreement and the other Loan Documents, and shall continue in full force
and effect with respect to the date as of which they were made as long as any
credit is in use or available hereunder.
Section 12.6. Survival of Indemnities. All indemnities and other
provisions relative to reimbursement to the Banks of amounts sufficient to
protect the yield of the Banks with respect to the Loans and Letters of Credit,
including, but not limited to, Sections 1.12, 10.3 and 12.15 hereof, shall
survive the termination of this Agreement and the other Loan Documents and the
payment of the Obligations.
Section 12.7. Sharing of Set-Off. Each Bank agrees with each other
Bank a party hereto that if such Bank shall receive and retain any payment,
whether by set-off or application of deposit balances or otherwise, on any of
the Loans or Reimbursement Obligations in excess of its ratable share of
payments on all such Obligations then outstanding to the Banks, then such Bank
shall purchase for cash at face value, but without recourse, ratably from each
of the other Banks such amount of the Loans or Reimbursement Obligations, or
participations therein, held by each such other Banks (or interest therein) as
shall be necessary to cause such Bank to share such excess payment ratably with
all the other Banks; provided, however, that if any such purchase is made by any
Bank, and if such excess payment or part thereof is thereafter recovered from
such purchasing Bank, the related purchases from the other Banks shall be
rescinded ratably and the purchase price restored as to the portion of such
excess payment so recovered, but without interest. For purposes of this Section,
amounts owed to or recovered by, the Agent in connection with Reimbursement
Obligations in which Banks have been required to fund their participation shall
be treated as amounts owed to or recovered by the Agent as a Bank hereunder.
Section 12.8. Notices. Except as otherwise specified herein, all
notices hereunder and under the other Loan Documents shall be in writing
(including, without limitation, notice by telecopy) and shall be given to the
relevant party at its address or telecopier number set forth below, or such
other address or telecopier number as such party may hereafter specify by notice
to the Agent and the Borrower given by courier, by United States certified or
registered mail, by telecopy or by other telecommunication device capable of
creating a written record of such notice and its receipt. Notices under the Loan
Documents to the Banks and the Agent shall be addressed to their respective
addresses or telecopier numbers set forth on the signature pages hereof, and to
the Borrower to:
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Vision Twenty-One, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with notices of any Event of Default also sent to:
▇▇▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Each such notice, request or other communication shall be effective (i) if
given by telecopier, when such telecopy is transmitted to the telecopier number
specified in this Section or on the signature pages hereof and a confirmation
of such telecopy has been received by the sender, (ii) if given by mail, 5 days
after such communication is deposited in the mail, certified or registered with
return receipt requested, addressed as aforesaid or (iii) if given by any other
means, when delivered at the addresses specified in this Section or on the
signature pages hereof; provided that any notice given pursuant to Section 1
hereof shall be effective only upon receipt.
Section 12.9. Counterparts. This Agreement may be executed in any
number of counterparts, and by the different parties hereto on separate
counterpart signature pages, and all such counterparts taken together shall be
deemed to constitute one and the same instrument.
Section 12.10. Successors and Assigns. This Agreement shall be
binding upon the Borrower and its successors and assigns, and shall inure to the
benefit of the Agent and each of the Banks and the benefit of their respective
successors and assigns, including any subsequent holder of any of the
Obligations. The Borrower may not assign any of its rights or obligations under
any Loan Document without the written consent of all of the Banks.
Section 12.11. Participants. Each Bank shall have the right at its
own cost to grant participations (to be evidenced by one or more agreements or
certificates of participation) in the Loans made and Reimbursement Obligations
and/or Commitments held by such Bank at any time and from time to time to one or
more other Persons; provided that no such participation shall relieve any Bank
of any of its obligations under this Agreement, and, provided, further that
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no such participant shall have any rights under this Agreement except as
provided in this Section, and the Agent shall have no obligation or
responsibility to such participant. Any agreement pursuant to which such
participation is granted shall provide that the granting Bank shall retain the
sole right and responsibility to enforce the obligations of the Borrower under
this Agreement and the other Loan Documents including, without limitation, the
right to approve any amendment, modification or waiver of any provision of the
Loan Documents, except that such agreement may provide that such Bank will not
agree to any modification, amendment or waiver of the Loan Documents that would
reduce the amount of or postpone any fixed date for payment of any Obligation in
which such participant has an interest. Any party to which such a participation
has been granted shall have the benefits of Section 1.12 and Section 10.3
hereof. The Borrower authorizes each Bank to disclose to any participant or
prospective participant under this Section any financial or other information
pertaining to the Borrower.
Section 12.12. Assignment of Commitments by Banks. Each Bank shall
have the right at any time, with the prior consent of the Agent and, so long as
no Event of Default then exists, the Borrower (which consent of the Borrower
shall not be unreasonably withheld-it being agreed that the Borrower's consent
shall not be required during the existence of any Event of Default), to sell,
assign, transfer or negotiate all or any part of its Commitments (including the
same percentage of its Notes, outstanding Loans and Reimbursement Obligations
owed to it) to one or more commercial banks or other financial institutions,
provided that, unless otherwise agreed to by the Agent, such assignment shall be
of a fixed percentage (and not by its terms of varying percentage) of the
assigning Bank's Commitments; provided, however, that in order to make any such
assignment (i) unless the assigning Bank is assigning all of its Commitments,
outstanding Loans and Reimbursement Obligations, the assigning Bank shall retain
at least $5,000,000 in Commitments, outstanding Loans and Reimbursement
Obligations, (ii) the assignee bank shall have Commitments, outstanding Loans
and Reimbursement Obligations of at least $5,000,000, (iii) each such assignment
shall be evidenced by a written agreement (substantially in the form attached
hereto as Exhibit I or in such other form acceptable to the Agent) executed by
such assigning Bank, such assignee bank or banks, the Agent and, if required as
provided above, the Borrower, which agreement shall specify in each instance the
portion of the Obligations which are to be assigned to the assignee bank and the
portion of the Commitments of the assigning Bank to be assumed by the assignee
bank or banks, and (iv) the assigning Bank shall pay to the Agent a processing
fee of $3,500 and any out-of-pocket attorneys' fees and expenses incurred by the
Agent in connection with any such assignment agreement. Any such assignee shall
become a Bank for all purposes hereunder to the extent of the Commitments it
assumes and the assigning Bank shall be released from its obligations, and will
have released its rights, under the Loan Documents to the extent of such
assignment. The Borrower authorizes each Bank to disclose to any purchaser or
prospective purchaser of an interest in the Loans and Reimbursement Obligations
owed to it or its Commitments under this Section any financial or other
information pertaining to the Borrower.
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Section 12.13. Amendments. Any provision of this Agreement or the
other Loan Documents may be amended or waived if, but only if, such amendment or
waiver is in writing and is signed by (a) the Borrower, (b) the Required Banks,
and (c) if the rights or duties of the Agent are affected thereby, the Agent;
provided that:
(i) no amendment or waiver pursuant to this Section
12.13 shall (A) increase any Commitment of any Bank without the consent
of such Bank or (B) reduce the amount of or postpone the date for
payment of any principal of or interest on any Loan or of any
Reimbursement Obligation or of any fee payable hereunder without the
consent of the Bank to which such payment is owing or which has
committed to make such Loan or Letter of Credit (or participate
therein) hereunder; and
(ii) no amendment or waiver pursuant to this Section
12.13 shall, unless signed by each Bank, change the definitions of
Revolving Credit Termination Date, Term A Credit Commitment Termination
Date, Term B Credit Commitment Termination Date, Term A Credit Final
Maturity Date, Term B Credit Final Maturity Date, or Required Banks,
change the provisions of this Section 12.13, Section 7, Section 9,
release any guarantor or all or any substantial part of the Collateral
(except as otherwise provided for in the Loan Documents), or affect the
number of Banks required to take any action hereunder or under any
other Loan Document.
Section 12.14. Headings. Section headings used in this Agreement
are for reference only and shall not affect the construction of this Agreement.
Section 12.15. Costs and Expenses. The Borrower agrees to pay all
reasonable costs and out-of-pocket expenses of the Agent in connection with the
preparation, negotiation, and administration of the Loan Documents, including,
without limitation, the reasonable fees and disbursements of counsel to the
Agent, in connection with the preparation and execution of the Loan Documents,
and any amendment, waiver or consent related thereto, whether or not the
transactions contemplated herein are consummated. The Borrower further agrees to
indemnify the Agent, each Bank, and their respective directors, officers and
employees, against all losses, claims, damages, penalties, judgments,
liabilities and expenses (including, without limitation, all reasonable expenses
of litigation or preparation therefor, whether or not the indemnified Person is
a party thereto) which any of them may pay or incur arising out of or relating
to any Loan Document or any of the transactions contemplated thereby or the
direct or indirect application or proposed application of the proceeds of any
Loan or Letter of Credit, other than those which arise from the gross negligence
or willful misconduct of the party claiming indemnification. The Borrower, upon
demand by the Agent or a Bank at any time, shall reimburse the Agent or such
Bank for any legal or other expenses incurred in connection with investigating
or defending against any of the foregoing (including any settlement costs
relating to the foregoing) except if
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the same is directly due to the gross negligence or willful misconduct of the
party to be indemnified. The obligations of the Borrower under this Section
shall survive the termination of this Agreement.
Section 12.16. Set-off. In addition to any rights now or hereafter
granted under applicable law and not by way of limitation of any such rights,
upon the occurrence of any Event of Default, each Bank and each subsequent
holder of any Obligation is hereby authorized by the Borrower at any time or
from time to time, without notice to the Borrower or to any other Person, any
such notice being hereby expressly waived, to set-off and to appropriate and to
apply any and all deposits (general or special, including, but not limited to,
indebtedness evidenced by certificates of deposit, whether matured or unmatured,
but not including trust accounts, and in whatever currency denominated) and any
other indebtedness at any time held or owing by that Bank or that subsequent
holder to or for the credit or the account of the Borrower, whether or not
matured, against and on account of the Obligations of the Borrower to that Bank
or that subsequent holder under the Loan Documents, including, but not limited
to, all claims of any nature or description arising out of or connected with the
Loan Documents, irrespective of whether or not (a) that Bank or that subsequent
holder shall have made any demand hereunder or (b) the principal of or the
interest on the Loans or Notes and other amounts due hereunder shall have become
due and payable pursuant to Section 9 and although said obligations and
liabilities, or any of them, may be contingent or unmatured. Any Bank exercising
any such right of set-off shall endeavor in good faith to give the Borrower
notice after effecting any such set-off; however such Bank shall in no event be
liable to the Borrower for such Bank's failure to do so and its failure to do so
shall not affect the validity of any such set-off.
Section 12.17. Entire Agreement. The Loan Documents constitute the
entire understanding of the parties thereto with respect to the subject matter
thereof and any prior agreements, whether written or oral, with respect thereto
are superseded hereby.
Section 12.18. Governing Law. This Agreement and the other Loan
Documents, and the rights and duties of the parties hereto, shall be construed
and determined in accordance with the internal laws of the State of Illinois.
Section 12.19. Severability of Provisions. Any provision of any
Loan Document which is unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such unenforceability without
invalidating the remaining provisions hereof or affecting the validity or
enforceability of such provision in any other jurisdiction.
Section 12.20. Excess Interest. Notwithstanding any provision to
the contrary contained herein or in any other Loan Document, no such provision
shall require the payment or permit the collection of any amount in excess of
the maximum amount of interest permitted by
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applicable law to be charged for the use or detention, or the forbearance in the
collection, of all or any portion of the Loans or other obligations outstanding
under this Agreement or any other Loan Document ("Excess Interest"). If any
Excess Interest is provided for, or is adjudicated to be provided for, herein or
in any other Loan Document, then in such event (a) the provisions of this
Section 12.20 shall govern and control; (b) neither the Borrower nor any
guarantor or endorser shall be obligated to pay any Excess Interest; (c) any
Excess Interest that the Agent or any Bank may have received hereunder shall, at
the option of the Agent, be (i) applied as a credit against the then outstanding
principal amount of Loans hereunder, accrued and unpaid interest thereon (not to
exceed the maximum amount permitted by applicable law) and any other
obligations, or all of the foregoing; (ii) refunded to the Borrower, or (iii)
any combination of the foregoing; (d) the interest rate payable hereunder or
under any other Loan Document shall be automatically subject to reduction to the
maximum lawful contract rate allowed under applicable usury laws, and this
Agreement and the other Loan Documents shall be deemed to have been, and shall
be, reformed and modified to reflect such reduction in the relevant interest
rate; and (e) neither the Borrower nor any guarantor or endorser shall have any
action against the Agent or any Bank for any damages whatsoever arising out of
the payment or collection of any Excess Interest.
Section 12.21. Confidentiality. Any information disclosed by the
Borrower or any of its Subsidiaries to the Agent or any Bank which was
designated proprietary or confidential at the time of its receipt by the Agent
or such Bank, and which it is not otherwise in the public domain, shall not be
disclosed by the Agent or such Bank to any other Person except (i) to its
independent accountants and legal counsel (it being understood that the Persons
to whom such disclosure is made will be informed of the confidential nature of
such information and instructed to keep such information confidential), (ii)
pursuant to statutory and regulatory requirements, (iii) pursuant to any
mandatory court order, subpoena or other legal process, (iv) to the Agent or any
other Bank, (v) pursuant to any agreement heretofore or hereafter made between
such Bank and the Borrower which permits such disclosure, (vi) in connection
with the exercise of any remedy under the Loan Documents, or (vii) subject to an
agreement containing provisions substantially the same as those of this Section,
to any participant in or assignee of, or prospective participant in or assignee
of, any Obligation or Commitments.
Section 12.22. Single Bank. If and so long as Bank of Montreal is
the only Bank hereunder, Bank of Montreal shall have all rights, powers and
privileges afforded to the Agent, the Banks, and the Required Banks hereunder
and under the other Loan Documents.
Section 12.23. Reaffirmation of Collateral Documents. The Borrower
heretofore executed and delivered to the Agent the Security Agreement and the
Pledge Agreement and certain other Collateral Documents for the benefit of the
Agent and the Banks. The Borrower hereby agrees that, notwithstanding the
execution and delivery of this Agreement, the Security
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Agreement, the Pledge Agreement, and all other Collateral Documents heretofore
executed and delivered to the Agent shall remain in full force and effect and
shall secure all the Obligations of the Borrower hereunder and under the other
Loan Documents and that all rights and remedies of the Agent and the Banks
thereunder, and all Obligations of the Borrower thereunder and all Liens created
and provided for thereunder, shall be and remain in full force and effect and
shall not be affected, impaired, or discharged hereby. The Borrower hereby
acknowledges and agrees, and the Agent and the Banks hereby acknowledge and
agree, that the "Credit Agreement" and the "Notes" referred to in the Security
Agreement, the Pledge Agreement, and such other Collateral Document shall from
and after the date hereof be deemed a reference to this Agreement and the Notes
issued hereunder.
Section 12.24 Equalization of Outstanding Loans. Anything
contained in the Original Credit Agreement or this Agreement to the contrary
notwithstanding, upon satisfactory completion of the conditions precedent to the
effectiveness of this Agreement as set forth in Section 7.1 above, the Borrower
shall prepay all outstanding Eurodollar Loans and Fixed Rate Loans outstanding
under the Original Credit Agreement, and thereafter there shall be such
non-ratable Borrowings and repayments thereof (and adjustments between the Banks
as to any outstanding Base Rate Loans) as shall be necessary so that after
giving effect thereto each Bank holds its ratable share of the relevant Loans
(and the Borrower shall pay to each Bank currently party to the Original Credit
Agreement who holds Eurodollar Loans or Fixed Rate Loans which are to be prepaid
any compensation required by Section 1.12 of the Original Credit Agreement).
Section 12.25. Submission to Jurisdiction; Waiver of Jury Trial.
The Borrower hereby submits to the nonexclusive jurisdiction of the United
States District Court for the Northern District of Illinois and of any Illinois
State court sitting in the City of Chicago for purposes of all legal
proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby. The Borrower
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient forum. THE BORROWER, THE AGENT AND
EACH BANK HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY
LEGAL PROCEEDING ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED THEREBY.
[SIGNATURE PAGES TO FOLLOW]
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Upon your acceptance hereof in the manner hereinafter set forth,
this Agreement shall constitute a contract between us for the uses and purposes
hereinabove set forth.
Dated as of this 1st day of July, 1998.
VISION TWENTY-ONE, INC.
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Financial Officer
Accepted and agreed to as of the day and year last above written.
BANK OF MONTREAL, in its individual
capacity as a Bank and as Agent
Address and Amount of Commitments: By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Address: Title: Director
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
with notices of Borrowing requests to:
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Revolving Credit Commitment:
$7,500,000
Term A Credit Commitment:
$22,500,000
Term B Credit Commitment:
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$70,000,000
Lending Offices:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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EXHIBIT A
NOTICE OF PAYMENT REQUEST
[Date]
[Name of Bank]
[Address]
Attention:
Reference is made to the Amended and Restated Credit Agreement,
dated as of July 1, 1998, among Vision Twenty-One, Inc., the Banks party
thereto, and Bank of Montreal, as Agent (the "Credit Agreement"). Capitalized
terms used herein and not defined herein have the meanings assigned to them in
the Credit Agreement. [The Borrower has failed to pay its Reimbursement
Obligation in the amount of $_________. Your Bank's Percentage of the unpaid
Reimbursement Obligation is $_________] or [Bank of Montreal has been required
to return a payment by the Borrower of a Reimbursement Obligation in the amount
of $________. Your Bank's Percentage of the returned Reimbursement Obligation
is $_________.]
Very truly yours,
BANK OF MONTREAL, as Agent
By
Its
------------------------------
90
EXHIBIT B
(LETTERHEAD)
VISION TWENTY-ONE, INC.
Date: ___/___/___
Fax to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal
Fax #: ▇▇▇-▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
RE: VISION TWENTY-ONE, INC.
Request for New Borrowing
Vision Twenty-One, Inc. requests the following activity:
_____ BORROWING AT BASE RATE INTEREST OPTION:
(Notify Agent day of borrowing by 10:00 a.m. Chicago time)
Borrowing Date: ___/___/___ Amount: $_________ Facility:
Revolving Credit
Borrowing Date: ___/___/___ Amount: $_________ Facility: Term
Credit
_____ BORROWING AT EURODOLLAR RATE INTEREST OPTION:
(Notify Agent 3 days prior to borrowing date by 10:00 a.m. Chicago
time)
Facility: Revolving Credit
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Borrowing Date: ___/___/___ Amount: $_________ Maturity Date:
___/___/___
Facility: Term A Credit
91
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Facility: Term B Credit
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
_____ BORROWING AT FIXED RATE INTEREST OPTION--TERM B CREDIT ONLY:
(Notify Agent 3 days prior to borrowing date by 10:00 a.m. Chicago
time)
Facility: Term B Credit
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Borrowing Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Please send the funds requested above using our standard wire transfer
instructions or the following:
BANK:_____________________________________________
ABA #:____________________________________________
ACCT NAME:________________________________________
ACCT #:___________________________________________
ATTN:_____________________________________________
From
Name_____________________________
Title____________________________
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92
EXHIBIT C
(LETTERHEAD)
VISION TWENTY-ONE, INC.
Date: ___/___/___
Fax to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal
Fax #: ▇▇▇-▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
RE: VISION TWENTY-ONE, INC.
Rollover/Conversion Request
Vision Twenty-One, Inc. requests the following activity:
_____ ROLLOVER EURODOLLAR CONTRACT:
Maturing Eurodollar Contract:
Amount: $_________ Facility:___________ Maturity Date
___/___/___
Interest Due: Agent will inform Vision Twenty-One, Inc.
Increase/Decrease Amount (if applicable): $______________
Please initiate a NEW EURODOLLAR Contract(s) as follows:
Amount $____________ New Maturity Date: ___/___/___
Amount $____________ New Maturity Date: ___/___/___
_____ CONVERT MATURING EURODOLLAR CONTRACT TO [BASE RATE] [FIXED RATE]*
OPTION:
Maturing Eurodollar Contract:
Amount: $____________ Facility:____________ Maturity Date
___/___/___
Interest Due: Agent will inform Vision Twenty-One, Inc.
Please convert the amount given below to the [BASE RATE] [FIXED
RATE]* Interest Option
------------------------
* only available for Term B Credits, and shall mature on the final maturity
date of the Term B Loans
93
Amount $____________ Repayment Amount (if applicable):
$____________
Interest Due: Agent will inform Vision Twenty-One, Inc.
_____ CONVERT BASE RATE FUNDS TO NEW [EURODOLLAR] [FIXED RATE]* CONTRACT:
Base Rate Funds:
Amount: $____________ Facility:________________ Effective Date
___/___/___
Repayment Amount (if applicable):________________
Interest Due: Agent will inform Vision Twenty-One, Inc.
Please initiate a NEW [EURODOLLAR] [FIXED RATE]* Contract(s) as follows:
Amount $____________ New Maturity Date: ___/___/___
Amount $____________ New Maturity Date: ___/___/___
From_________________________________
Name______________________________
Title_____________________________
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94
EXHIBIT D
REVOLVING NOTE
U.S. $_______________ ________________, 19___
FOR VALUE RECEIVED, the undersigned, VISION TWENTY-ONE, INC., a
Florida corporation (the "Borrower"), hereby promises to pay to the order of
______________________ (the "Bank") on the Revolving Credit Termination Date of
the hereinafter defined Credit Agreement, at the principal office of Bank of
Montreal, as Agent, in Chicago, Illinois, in immediately available funds, the
principal sum of ___________________ Dollars ($__________) or, if less, the
aggregate unpaid principal amount of all Revolving Loans made by the Bank to
the Borrower pursuant to the Credit Agreement, together with interest on the
principal amount of each Revolving Loan from time to time outstanding hereunder
at the rates, and payable in the manner and on the dates, specified in the
Credit Agreement.
The Bank shall record on its books or records or on a schedule
attached to this Note, which is a part hereof, each Revolving Loan made by it
pursuant to the Credit Agreement, together with all payments of principal and
interest and the principal balances from time to time outstanding hereon,
whether the Revolving Loan is a Base Rate Loan or a Eurodollar Loan, the
interest rate and Interest Period applicable thereto, provided that prior to
the transfer of this Note all such amounts shall be recorded on a schedule
attached to this Note. The record thereof, whether shown on such books or
records or on a schedule to this Note, shall be prima facie evidence of the
same, provided, however, that the failure of the Bank to record any of the
foregoing or any error in any such record shall not limit or otherwise affect
the obligation of the Borrower to repay all Revolving Loans made to it pursuant
to the Credit Agreement together with accrued interest thereon.
This Note is one of the Revolving Notes referred to in the Amended
and Restated Credit Agreement dated as of July 1, 1998, among the Borrower,
Bank of Montreal, as Agent, and the Banks party thereto (the "Credit
Agreement"), and this Note and the holder hereof are entitled to all the
benefits and security provided for thereby or referred to therein, to which
Credit Agreement reference is hereby made for a statement thereof. All defined
terms used in this Note, except terms otherwise defined herein, shall have the
same meaning as in the Credit Agreement. This Note shall be governed by and
construed in accordance with the internal laws of the State of Illinois.
95
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
The Borrower hereby waives demand, presentment, protest or notice
of any kind hereunder.
VISION TWENTY-ONE, INC.
By
Name_________________________
Title________________________
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96
EXHIBIT E
TERM A NOTE
U.S. $_______________ ________________, 19___
FOR VALUE RECEIVED, the undersigned, VISION TWENTY-ONE, INC., a
Florida corporation (the "Borrower"), hereby promises to pay to the order of
______________________ (the "Bank") at the principal office of Bank of
Montreal, as Agent, in Chicago, Illinois, in immediately available funds, the
principal sum of ___________________ Dollars ($__________) or, if less, the
aggregate unpaid principal amount of all Term A Loans made or maintained by the
Bank to the Borrower pursuant to the Credit Agreement, in consecutive
quarter-annual principal installments in the amounts called for by Section
1.8(b) of the Credit Agreement, commencing on ________________, _____, and
continuing on the last day of each __________, __________, __________, and
__________ occurring thereafter, together with interest on the principal amount
of such Term A Loans from time to time outstanding hereunder at the rates, and
payable in the manner and on the dates, specified in the Credit Agreement,
except that all principal and interest not sooner paid on the Term A Loans
evidenced hereby shall be due and payable on the Term A Credit Final Maturity
Date.
The Bank shall record on its books or records or on a schedule
attached to this Note, which is a part hereof, each Term A Loan made or
maintained by it pursuant to the Credit Agreement, together with all payments
of principal and interest and the principal balances from time to time
outstanding hereon, whether the Term A Loan is a Base Rate Loan or a Eurodollar
Loan, the interest rate and Interest Period applicable thereto, provided that
prior to the transfer of this Note all such amounts shall be recorded on a
schedule attached to this Note. The record thereof, whether shown on such books
or records or on a schedule to this Note, shall be prima facie evidence of the
same, provided, however, that the failure of the Bank to record any of the
foregoing or any error in any such record shall not limit or otherwise affect
the obligation of the Borrower to repay all Term A Loans made to it pursuant to
the Credit Agreement together with accrued interest thereon.
This Note is one of the Term A Notes referred to in the Amended and
Restated Credit Agreement dated as of July 1, 1998, among the Borrower, Bank of
Montreal, as Agent, and the Banks party thereto (the "Credit Agreement"), and
this Note and the holder hereof are entitled to all the benefits and security
provided for thereby or referred to therein, to which Credit Agreement
reference is hereby made for a statement thereof. All defined terms used in
this Note, except terms otherwise defined herein, shall have the same meaning
as in the Credit Agreement.
97
This Note shall be governed by and construed in accordance with the internal
laws of the State of Illinois.
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
The Borrower hereby waives demand, presentment, protest or notice
of any kind hereunder.
VISION TWENTY-ONE, INC.
By
Name______________________________
Title_____________________________
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98
EXHIBIT F
TERM B NOTE
U.S. $_______________ ________________, 19___
FOR VALUE RECEIVED, the undersigned, VISION TWENTY-ONE, INC., a
Florida corporation (the "Borrower"), hereby promises to pay to the order of
______________________ (the "Bank") at the principal office of Bank of
Montreal, as Agent, in Chicago, Illinois, in immediately available funds, the
principal sum of ___________________ Dollars ($__________) or, if less, the
aggregate unpaid principal amount of all Term B Loans made or maintained by the
Bank to the Borrower pursuant to the Credit Agreement, in consecutive
quarter-annual principal installments in the amounts called for by Section
1.8(c) of the Credit Agreement, commencing on September 30, 1998, and
continuing on the last day of each September occurring thereafter, together
with interest on the principal amount of such Term B Loans from time to time
outstanding hereunder at the rates, and payable in the manner and on the dates,
specified in the Credit Agreement, except that all principal and interest not
sooner paid on the Term B Loans evidenced hereby shall be due and payable on
the Term B Credit Final Maturity Date.
The Bank shall record on its books or records or on a schedule
attached to this Note, which is a part hereof, each Term B Loan made or
maintained by it pursuant to the Credit Agreement, together with all payments
of principal and interest and the principal balances from time to time
outstanding hereon, whether the Term B Loan is a Base Rate Loan or a Eurodollar
Loan or a Fixed Rate Loan, the interest rate and Interest Period applicable
thereto, provided that prior to the transfer of this Note all such amounts
shall be recorded on a schedule attached to this Note. The record thereof,
whether shown on such books or records or on a schedule to this Note, shall be
prima facie evidence of the same, provided, however, that the failure of the
Bank to record any of the foregoing or any error in any such record shall not
limit or otherwise affect the obligation of the Borrower to repay all Term B
Loans made to it pursuant to the Credit Agreement together with accrued
interest thereon.
This Note is one of the Term B Notes referred to in the Amended and
Restated Credit Agreement dated as of July 1, 1998, among the Borrower, Bank of
Montreal, as Agent, and the Banks party thereto (the "Credit Agreement"), and
this Note and the holder hereof are entitled to all the benefits and security
provided for thereby or referred to therein, to which Credit Agreement
reference is hereby made for a statement thereof. All defined terms used in
this Note, except terms otherwise defined herein, shall have the same meaning
as in the Credit Agreement.
99
This Note shall be governed by and construed in accordance with the internal
laws of the State of Illinois.
Voluntary prepayments may be made hereon, certain prepayments are
required to be made hereon, and this Note may be declared due prior to the
expressed maturity hereof, all in the events, on the terms and in the manner as
provided for in the Credit Agreement.
The Borrower hereby waives demand, presentment, protest or notice
of any kind hereunder.
VISION TWENTY-ONE, INC.
By
Name_____________________________
Title____________________________
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100
EXHIBIT G
(LETTERHEAD)
VISION TWENTY-ONE, INC.
Date: ___/___/___
Fax to: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Bank of Montreal
Fax #: ▇▇▇-▇▇▇-▇▇▇▇
Tel: ▇▇▇-▇▇▇-▇▇▇▇
RE: VISION TWENTY-ONE, INC.
Notice of Repayment
Vision Twenty-One, Inc. requests the following activity:
_____ REPAYMENT OF OUTSTANDING BORROWINGS UNDER BASE RATE OPTION:
(Notify Agent day of repayment by 10:00 a.m. Chicago time. Funds must
be received by 12:00 noon Chicago time day of repayment.)
Repayment Date: ___/___/___ Amount: $_________ Facility: Revolving
Credit
Repayment Date: ___/___/___ Amount: $_________ Facility: Term Credit
_____ REPAYMENT OF OUTSTANDING BORROWINGS UNDER EURODOLLAR OPTION:
(Notify Agent 3 Days prior to repayment and Receive Funds by 12:00
noon Chicago time day of repayment)
Facility: Revolving Credit
---------------------------
Repayment Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Repayment Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Facility: Term A Credit
------------------------
Repayment Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Repayment Date: ___/___/___ Amount: $________ Maturity Date:
___/___/___
Facility: Term B Credit
------------------------
101
Repayment Date: ___/___/___ Amount: $___________ Maturity Date:
___/___/___
Repayment Date: ___/___/___ Amount: $___________ Maturity Date:
___/___/___
_____ REPAYMENT OF OUTSTANDING BORROWINGS UNDER FIXED RATE OPTION
(Notify Agent 3 Days prior to repayment and Receive funds by 12:00
noon Chicago time day of repayment)
Facility: Term B Credit
Repayment Date: ___/___/___ Amount: $___________ Maturity Date:
___/___/___
Repayment Date: ___/___/___ Amount: $___________ Maturity Date:
___/___/___
From
----------------------------------
Name
--------------------------------
Title
-------------------------------
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102
EXHIBIT H
COMPLIANCE CERTIFICATE
FOR
VISION TWENTY-ONE, INC.
To: Bank of Montreal, as Agent
under, and the Banks party to,
the Credit Agreement referred t
o below
This Compliance Certificate is furnished to Bank of Montreal, as
Agent (the "Agent") pursuant to that certain Amended and Restated Credit
Agreement dated as of July 1, 1998, among Vision Twenty-One, Inc. (the
"Borrower"), Bank of Montreal, as Agent, and the Banks party thereto (the
"Credit Agreement"). Unless otherwise defined herein, the terms used in this
Compliance Certificate have the meanings ascribed thereto in the Credit
Agreement.
THE UNDERSIGNED HEREBY CERTIFIES THAT:
1. I am the duly elected __________________________ of the
Borrower;
2. I have reviewed the terms of the Credit Agreement and I
have made, or have caused to be made under my supervision, a
detailed review of the transactions and conditions of the Borrower
and its Subsidiaries during the accounting period covered by the
attached financial statements;
3. The examinations described in paragraph 2 did not
disclose, and I have no knowledge of, the existence of any condition
or the occurrence of any event which constitutes a Default or Event
of Default during or at the end of the accounting period covered by
the attached financial statements or as of the date of this
Certificate, except as set forth below; and
4. The Attachment hereto sets forth financial data and
computations evidencing the Borrower's compliance with certain
covenants of the Credit Agreement, all of which data and
computations are, to the best of my knowledge, true, complete and
correct and have been made in accordance with the relevant Sections
of the Credit Agreement.
103
Described below are the exceptions, if any, to paragraph 3 by
listing, in detail, the nature of the condition or event, the period during
which it has existed and the action which the Borrower has taken, is taking, or
proposes to take with respect to each such condition or event:
--------------------------------------------------------------------
--------------------------------------------------------------------
--------------------------------------------------------------------
--------------------------------------------------------------------
The foregoing certifications, together with the computations set
forth in the Attachment hereto and the financial statements delivered with this
Certificate in support hereof, are made and delivered this _________ day of
__________________ 19___.
VISION TWENTY-ONE, INC.
By
-----------------------------------------
------------------ , --------------------
(Name) (Title)
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104
ATTACHMENT TO COMPLIANCE CERTIFICATE
FOR
VISION TWENTY-ONE, INC.
Compliance Calculations for Amended and Restated Credit Agreement
Dated as of July 1, 1998
Calculations as of _____________, _____
A. Current Ratio (Section 8.6)
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1. Consolidated current assets $
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2. Consolidated current liabilities $
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3. Ratio of line A1 to A2 :1.0
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4. Line A3 ratio must be equal to or greater than 1.0:1.0
5. The Borrower is in compliance (circle yes or no) yes/no
B. Total Funded Debt/Adjusted EBITDA Ratio (Section 8.8)
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1. Total Funded Debt $
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2. Net Income (adjusted, pro forma, for acquisition effect) for past
4 quarters
------------
3. Interest Expense (adjusted, pro forma, for acquisition effect) for
past 4 quarters
------------
4. Taxes (adjusted, pro forma, for acquisition effect) for past 4 quarters
------------
5. Depreciation, Amortization and other Non-Cash Charges
(adjusted, pro forma, for acquisition effect) for past 4 quarters
------------
105
6. Sum of Lines B2, B3, B4, and B5 ("Adjusted EBITDA")
-----------
7. Ratio of Line B1 to B6 :1.0
---
8. Line B7 ratio must not be equal to or greater than :1.0
---
9. The Borrower is in compliance (circle yes or no) yes/no
C. Net Worth (Section 8.9)
-----------------------
1. Net Worth $
-----------
2. Line C1 shall not be less than $
-----------
3. The Borrower is in compliance (circle yes or no) yes/no
D. Interest Coverage Ratio (Section 8.10)
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1. Net Income for past 4 quarters $
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2. Interest Expense for past 4 quarters $
-----------
3. Taxes for past 4 quarters $
-----------
4. Depreciation, Amortization and other Non-Cash Charges for
past 4 quarters $
-----------
5. Sum of lines D1, D2, D3 and D4 ("EBITDA") $
-----------
6. Interest Expense for past 4 quarters $
-----------
7. Ratio of Line D5 to Line D6 : 1.0
---
8. Line D7 ratio must not be less than : 1.0
---
9. The Borrower is in compliance (circle yes or no) yes/no
E. Debt Service Coverage Ratio (Section 8.11)
------------------------------------------
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1. EBITDA (Line D5 above) for past 4 quarters $
-----------
2. Capital Expenditures for past 4 quarters $
-----------
3. Cash payments in respect of income taxes for past 4 quarters $
-----------
4. Line E1 minus Lines E2 and E3 $
-----------
5. Principal payments for past 4 quarters $
-----------
6. Interest Expense for past 4 quarters $
-----------
7. Line E5 plus Line E6 $
-----------
8. Ratio of Line E4 to Line E7 ____:1.0
9. Line E8 ratio must not be less than ____:1.0
10. The Borrower is in compliance (circle yes or no) yes/no
F. Capital Expenditures (Section 8.12)
1. Capital Expenditures (year-to-date) $
-----------
2. Line F1 not to exceed $
-----------
3. The Borrower is in compliance (circle yes or no) yes/no
G. Other Permitted Indebtedness (Section 8.13(h))
1. Indebtedness for Borrowed Money (exclusive of indebtedness
permitted under Section 8.13(a)-(g)) $
-----------
2. Line G1 not to exceed $ 5,000,000
3. The Borrower is in compliance (circle yes or no) yes/no
H. Limits on certain Non-Material Subsidiaries (Section 8.28)
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107
1. Combined total assets of
(a) Block Vision of Texas, Inc. $
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(b) Vision Insurance Plan of
America, Inc. $
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(c) Vision Twenty-One Surgery
Center, Ltd. $
----------
(d) Vision Twenty-One Surgery
Center-Largo, Ltd. $
----------
TOTAL $
----------
2. Consolidated total assets of Borrower
and its Subsidiaries $
----------
x .025 $
------------ ----------
3. Line H1 less than Line H2 yes/no
4. Combined gross revenues of
(a) Block Vision of Texas, Inc. $
----------
(b) Vision Insurance Plan of
America, Inc. $
----------
(c) Vision Twenty-One Surgery
Center, Ltd. $
----------
(d) Vision Twenty-One Surgery
Center-Largo, Ltd. $
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TOTAL $
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5. Consolidated total revenues of
Borrower and its Subsidiaries $
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x .025 $
------------ -----------
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6. Line H4 less than Line H5 yes/no
7. The Borrower is in compliance (circle yes or no) yes/no
I. Total Funded Debt to Total Capitalization (Section 8.31)
1. Total Funded Debt $
-----------
2. Net Worth $
-----------
3. Sum of Lines I1 and I2 $
-----------
4. Ratio of Line I1 to Line I3 :1.0
---
5. Line I4 ratio shall not exceed :1.0
---
6. The Borrower is in compliance (circle yes or no) yes/no
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EXHIBIT I
ASSIGNMENT AND ACCEPTANCE
Dated _____________, 19_____
Reference is made to the Amended and Restated Credit Agreement
dated as of July 1, 1998 (the "Credit Agreement") among Vision Twenty-One,
Inc., a Florida corporation, the Banks (as defined in the Credit Agreement) and
Bank of Montreal, as Agent for the Banks (the "Agent"). Terms defined in the
Credit Agreement are used herein with the same meaning.
_____________________________________________________ (the
"Assignor") and _________________________ (the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the
Assignee, and the Assignee hereby purchases and assumes from the
Assignor, a _______% interest in and to all of the Assignor's
rights and obligations under the Credit Agreement as of the
Effective Date (as defined below), including, without limitation,
such percentage interest in the Assignor's Commitments as in effect
on the Effective Date and the Loans, if any, owing to the Assignor
on the Effective Date and the Assignor's Percentage of any
outstanding L/C Obligations.
2. The Assignor (i) represents and warrants that as
of the date hereof (A) its Revolving Credit Commitment is
$_____________ and its Term A Credit Commitment is $____________
and its Term B Credit Commitment is $____________, (B) the
aggregate outstanding principal amount of Loans made by it under
the Credit Agreement that have not been repaid is $____________
($_____________ of Revolving Loans and $_____________ of Term A
Loans and $____________ of Term B Loans) and a description of the
interest rates and interest periods of such Loans is attached as
Schedule 1 hereto, and (C) the aggregate principal amount of
Assignor's Percentage of outstanding L/C Obligations is
$____________; (ii) represents and warrants that it is the legal
and beneficial owner of the interest being assigned by it hereunder
and that such interest is free and clear of any adverse claim,
lien, or encumbrance of any kind; (iii) makes no representation or
warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection
with the Credit Agreement or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the Credit
Agreement or any other instrument or document furnished pursuant
thereto; and (iv) makes no representation or warranty and assumes
no responsibility with respect to the financial condition of the
Borrower or any Subsidiary or the performance or
110
observance by the Borrower or any Subsidiary of any of its obligations
under the Credit Agreement or any other instrument or document
furnished pursuant thereto.
3. The Assignee (i) confirms that it has received a
copy of the Credit Agreement, together with copies of the most recent
financial statements delivered to the Banks and referred to in Section
8.5(b) and (c) thereof and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to
enter into this Assignment and Acceptance; (ii) agrees that it will,
independently and without reliance upon the Agent, the Assignor or any
other Bank and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Credit Agreement; (iii) appoints
and authorizes the Agent to take such action as Agent on its behalf and
to exercise such powers under the Credit Agreement and the other Loan
Documents as are delegated to the Agent 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 and the other Loan Documents
are required to be performed by it as a Bank; and (v) specifies as its
lending office (and address for notices) the offices set forth beneath
its name on the signature pages hereof.
4. As consideration for the assignment and sale
contemplated in Section 1 hereof, the Assignee shall pay to the
Assignor on the Effective Date in Federal funds an amount equal to
$________________*. It is understood that commitment and/or letter of
credit fees accrued to the Effective Date with respect to the interest
assigned hereby are for the account of the Assignor and such fees
accruing from and including the date hereof are for the account of the
Assignee. Each of the Assignor and the Assignee hereby agrees that if
it receives any amount under the Credit Agreement which is for the
account of the other party hereto, it shall receive the same for the
account of such other party to the extent of such other party's
interest therein and shall promptly pay the same to such other party.
5. The effective date for this Assignment and
Acceptance shall be _____________, 19___(the "Effective Date").
Following the execution of this Assignment and Acceptance, it will be
delivered to the Agent for acceptance and recording by the Agent and,
if required, the Borrower.
-------------------------
* Amount should combine principal together with accrued interest and breakage
compensation, if any, to be paid by the Assignee, net of any portion of any
upfront fee to be paid by the Assignor to the Assignee. It may be
preferable in an appropriate case to specify these amounts generically or by
formula rather than as a fixed sum.
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111
6. Upon such acceptance and recording, as of the
Effective Date, (i) the Assignee shall be a party to the Credit
Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Bank thereunder and
(ii) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations
under the Credit Agreement.
7. Upon such acceptance and recording, from and after
the Effective Date, the Agent shall make all payments under the Credit
Agreement in respect of the interest assigned hereby (including,
without limitation, all payments of principal, interest and commitment
fees with respect thereto) to the Assignee. The Assignor and Assignee
shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Effective Date directly between
themselves.
8. In accordance with Section 12.12 of the Credit
Agreement, the Assignor and the Assignee request and direct that
the Agent prepare and cause the Borrower to execute and deliver to
the Assignee the relevant Notes payable to the Assignee in the
amount of its Commitments and new Notes to the Assignor in the
amount of its Commitments after giving effect to this assignment.
9. This Assignment and Acceptance shall be governed by,
and construed in accordance with, the laws of the State of Illinois.
[Assignor Bank]
By
Name
--------------------------------
Title
-------------------------------
[Assignee Bank]
By
Name
--------------------------------
Title
-------------------------------
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112
Lending office (and address for notices):
Accepted and consented this
____ day of ___________, 19__
VISION TWENTY-ONE, INC.
By
-------------------------------------
Name
---------------------------------
Title
--------------------------------
Accepted and consented to by the Agent this
_______ day of ___________, 19__
BANK OF MONTREAL, as Agent
By
-------------------------------------
Name
---------------------------------
Title
--------------------------------
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113
SCHEDULE I
PRINCIPAL AMOUNT TYPE OF LOAN INTEREST RATE MATURITY DATE
114
SCHEDULE 6.2
SUBSIDIARIES
NAME JURISDICTION OF INCORPORATION PERCENTAGE
OWNERSHIP
Vision 21 Physician Practice Management Florida 100%
Company
Vision Twenty-One Eye Laser Centers, Inc. Florida 100%
Vision 21 of Southern Arizona, Inc. Florida 100%
Vision 21 of Sierra Vista, Inc. Florida 100%
Vision 21 Management Services, Inc. Florida 100%
Vision 21 Managed Eye Care of Tampa Florida 100%
Bay, Inc.
Vision Twenty-One Managed Eye Care New York 100%
IPA, Inc.
BBG-COA, Inc. Delaware 100%
MEC Health Care, Inc. Maryland 100%
LSI Acquisition, Inc. New Jersey 100%
Vision Twenty-One of Wisconsin, Inc. Wisconsin 100%
Vision Twenty-One Eye Surgery Centers, Florida 100%
Inc.
Eye Surgery Center Management, Inc. Florida 100%
Vision Twenty-One Refractive Center, Inc. Florida 100%
BVC Administrators, Inc. New Jersey 100%(1)
----------------------------
(1) Subsidiaries of BBG-COA, Inc.
115
Block Vision, Inc. New Jersey 100%(1)
BHVC Independent Practice Association, New York 100%(2)
Inc.
The Block Group of New York, Inc. New York 100%(2)
BBG Independent Practice Association, New York 100%(2)
Inc.
VCA Independent Practice Association, . New York 100%(2)
Inc.
UVC Independent Practice Association, New York 100%(2)
Inc.
CHVC Independent Practice Association, New York 100%(2)
Inc.
Block Vision of Texas, Inc. Texas 100%(2)
WVC Independent Practice Association, New York 100%(2)
Inc.
FVC Independent Practice Association, Inc. New York 100%(2)
MVC Independent Practice Association, New York 100%(2)
Inc.
Vision Insurance Plans of America, Inc. Wisconsin 100%(3)
Vision Twenty-One Surgery Center, Ltd. Florida 4
Vision Twenty-One Surgery Center-Largo, Florida 4
Ltd.
---------------------------
(2) Subsidiaries of Block Vision, Inc.
(2) Subsidiaries of Block Vision, Inc.
(3) Subsidiary of Vision Twenty-One of Wisconsin, Inc.
(4) Vision Twenty-One Eye Surgery Centers, Inc. is currently general partner to
those newly-formed limited partnerships. Final percentage equity interest
to be determined.
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SCHEDULE 6.7
ADDITIONAL DISCLOSURES
None
117
SCHEDULE 6.12
TAXES
The Internal Revenue Service has notified Block Vision, Inc. that
it intends to conduct a routine examination of that company's consolidated tax
return filed on Form 1120 for the year ended April 30, 1996.
118
SCHEDULE 8.13
PERMITTED INDEBTEDNESS
Capital lease obligation:
Property equipment lease dated June 27, 1996
with Hillside Finance International, LLC $ 650,000
Note payable to selling shareholder with
Interest at the rate of 8% due April 1998 245,440
Other long-term debt 387,797
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$1,283,237
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