EXHIBIT 4.2
AMENDED AND RESTATED
CREDIT AGREEMENT
among
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
AS AGENT AND AN ISSUING BANK,
THE FIRST NATIONAL BANK OF CHICAGO,
AS DOCUMENTATION AGENT,
THE SEVERAL FINANCIAL INSTITUTIONS
FROM TIME TO TIME PARTY HERETO
and
HEALTHCOR HOLDINGS, INC.
and
HEALTHCOR, INC.,
as Borrowers
Dated as of October 31, 1996
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TABLE OF CONTENTS
PAGE
ARTICLE I - Definitions.................................................... 2
Section 1.1 Definitions............................................ 2
Section 1.2 Other Definitional Provisions.......................... 18
ARTICLE II - Revolving Credit Loans........................................ 18
Section 2.1 Revolving Credit Commitments........................... 18
Section 2.2 Revolving Credit Notes................................. 18
Section 2.3 Repayment of Revolving Credit Loans.................... 18
Section 2.4 Interest............................................... 18
Section 2.5 Use of Proceeds........................................ 19
Section 2.6 Commitment Fee......................................... 19
Section 2.7 Reduction or Termination of Revolving Credit
Commitments ........................................ 19
ARTICLE III - Acquisition Line Loans....................................... 20
Section 3.1 Acquisition Line Loans................................. 20
Section 3.2 The Acquisition Line Notes............................. 20
Section 3.3 Repayment of Acquisition Line Loans.................... 20
Section 3.4 Interest............................................... 21
Section 3.5 Prepayments from Excess Cash Flow...................... 21
Section 3.6 [Intentionally Omitted]................................ 21
Section 3.7 Use of Proceeds........................................ 22
Section 3.8 Commitment Fee......................................... 22
Section 3.9 Reduction or Termination of Acquisition Line
Commitments ......................................... 22
ARTICLE IV - Letters of Credit............................................. 22
Section 4.1 Letters of Credit...................................... 22
Section 4.2 Participation by Banks................................. 22
Section 4.3 Procedure for Issuing Letters of Credit................ 23
Section 4.4 Reimbursements; Payments Constitute Revolving Credit
Loans ............................................... 23
Section 4.5 Letter of Credit Fee................................... 23
Section 4.6 Obligations Absolute................................... 24
Section 4.7 Limitation of Liability................................ 24
Section 4.8 Letter of Credit Documents............................. 25
ARTICLE V - Borrowing Procedure; Payments.................................. 25
Section 5.1 Borrowing Procedure.................................... 25
Section 5.2 Conversions and Continuations.......................... 26
Section 5.3 Method of Payment...................................... 26
Section 5.4 Voluntary Prepayment................................... 26
Section 5.5 Pro Rata Treatment..................................... 27
Section 5.6 Non-Receipt of Funds by the Agent...................... 27
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TABLE OF CONTENTS
(Continued)
PAGE
Section 5.7 Withholding Taxes...................................... 27
Section 5.8 Withholding Tax Exemption.............................. 28
Section 5.9 Computation of Interest................................ 29
ARTICLE VI - Yield Protection and Illegality............................... 29
Section 6.1 Additional Costs....................................... 29
Section 6.2 Limitation on Types of Loans........................... 30
Section 6.3 Illegality............................................. 31
Section 6.4 Treatment of Eurodollar Loans.......................... 31
Section 6.5 Compensation........................................... 32
Section 6.6 Capital Adequacy....................................... 32
Section 6.7 Additional Costs in Respect of Letters of Credit....... 33
ARTICLE VII - Security..................................................... 33
Section 7.1 Collateral............................................. 33
Section 7.2 Lockbox Accounts....................................... 34
Section 7.3 Guaranties............................................. 35
Section 7.4 Setoff................................................. 35
ARTICLE VIII - Conditions Precedent........................................ 35
Section 8.1 Initial Loans.......................................... 35
Section 8.2 All Loans.............................................. 38
Section 8.3 Acquisition Line Loans................................. 38
ARTICLE IX - Representations and Warranties................................ 38
Section 9.1 Corporate Existence.................................... 38
Section 9.2 Financial Statements................................... 39
Section 9.3 Corporate Action; No Breach............................ 39
Section 9.4 Operation of Business.................................. 39
Section 9.5 Litigation and Judgments............................... 40
Section 9.6 Rights in Properties; Liens............................ 40
Section 9.7 Enforceability......................................... 40
Section 9.8 Approvals.............................................. 40
Section 9.9 Debt................................................... 40
Section 9.10 Taxes.................................................. 40
Section 9.11 Use of Proceeds; Margin Securities..................... 41
Section 9.12 ERISA.................................................. 41
Section 9.13 Disclosure............................................. 41
Section 9.14 Subsidiaries........................................... 41
Section 9.15 Agreements............................................. 41
Section 9.16 Compliance with Laws; Environmental Liabilities........ 42
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TABLE OF CONTENTS
(Continued)
PAGE
Section 9.17 Fraud and Abuse........................................ 42
Section 9.18 Self Referral.......................................... 42
ARTICLE X - Positive Covenants............................................. 43
Section 10.1 Reporting Requirements................................. 43
Section 10.2 Maintenance of Existence; Conduct of Business.......... 44
Section 10.3 Maintenance of Properties.............................. 45
Section 10.4 Taxes and Claims....................................... 45
Section 10.5 Insurance.............................................. 45
Section 10.6 Inspection Rights...................................... 45
Section 10.7 Keeping Books and Records.............................. 45
Section 10.8 Compliance with Laws................................... 46
Section 10.9 Compliance with Agreements............................. 46
Section 10.10 Further Assurances..................................... 46
Section 10.11 ERISA.................................................. 46
Section 10.12 Security Agreements; Guaranties........................ 46
ARTICLE XI - Negative Covenants............................................ 46
Section 11.1 Funded Debt............................................ 46
Section 11.2 Limitation on Liens.................................... 47
Section 11.3 Mergers, Etc........................................... 49
Section 11.4 Restricted Payments.................................... 49
Section 11.5 Loans and Investments.................................. 50
Section 11.6 Limitation on Issuance of Subsidiaries' Capital Stock.. 51
Section 11.7 Transactions With Affiliates........................... 51
Section 11.8 Disposition of Assets.................................. 51
Section 11.9 Sale and Leaseback..................................... 52
Section 11.10 Prepayment of Funded Debt.............................. 52
Section 11.11 Nature of Business..................................... 52
Section 11.12 Environmental Protection............................... 52
Section 11.13 Accounting............................................. 52
Section 11.14 Compensation........................................... 52
ARTICLE XII - Financial Covenants.......................................... 52
Section 12.1 Funded Debt to EBITDAA Ratio........................... 52
Section 12.2 Consolidated Net Worth................................. 53
Section 12.3 Fixed Charge Coverage Ratio............................ 53
Section 12.4 Capital Expenditures................................... 53
Section 12.5 Funded Debt to Capitalization Ratio.................... 53
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TABLE OF CONTENTS
(Continued)
PAGE
ARTICLE XIII - Default..................................................... 53
Section 13.1 Events of Default...................................... 53
Section 13.2 Remedies............................................... 56
Section 13.3 Letters of Credit...................................... 56
Section 13.4 Performance by the Agent............................... 57
ARTICLE XIV - The Agent and the Documentation Agent........................ 57
Section 14.1 Appointment, Powers and Immunities..................... 57
Section 14.2 Rights of Agent and Documentation Agent as a Bank...... 59
Section 14.3 Sharing of Payments, Etc............................... 59
Section 14.4 INDEMNIFICATION........................................ 59
Section 14.5 Independent Credit Decisions........................... 60
Section 14.6 Several Commitments.................................... 61
Section 14.7 Successor Agent and Documentation Agent................ 61
ARTICLE XV - Miscellaneous................................................. 62
Section 15.1 Expenses............................................... 62
Section 15.2 INDEMNIFICATION........................................ 62
Section 15.3 LIMITATION OF LIABILITY................................ 63
Section 15.4 No Duty................................................ 63
Section 15.5 No Fiduciary Relationship.............................. 63
Section 15.6 No Waiver; Cumulative Remedies......................... 63
Section 15.7 Successors and Assigns................................. 64
Section 15.8 Survival............................................... 66
Section 15.9 ENTIRE AGREEMENT....................................... 66
Section 15.10 Amendments, Etc........................................ 67
Section 15.11 Maximum Interest Rate.................................. 67
Section 15.12 Notices................................................ 68
Section 15.13 GOVERNING LAW; VENUE; SERVICE OF PROCESS............... 68
Section 15.14 Counterparts........................................... 68
Section 15.15 Severability........................................... 69
Section 15.16 Headings............................................... 69
Section 15.17 Construction........................................... 69
Section 15.18 Independence of Covenants.............................. 69
-iv-
AMENDED AND RESTATED CREDIT AGREEMENT
THIS AMENDED AND RESTATED CREDIT AGREEMENT (the "AGREEMENT"), dated as of
October 31, 1996, is among HEALTHCOR HOLDINGS, INC., a corporation duly
organized and validly existing under the laws of the State of Delaware
("HOLDINGS"), HEALTHCOR, INC., a corporation duly organized and validly existing
under the laws of the State of Delaware ("HEALTHCOR" with Holdings and HealthCor
being hereinafter collectively referred to as the "BORROWERS"), each of the
banks or other lending institutions which is or which may from time to time
become a signatory hereto or any successor or assignee thereof (individually, a
"BANK" and, collectively, the "BANKS"), THE FIRST NATIONAL BANK OF CHICAGO, a
national banking association, as documentation agent (in such capacity, the
"DOCUMENTATION AGENT"), and TEXAS COMMERCE BANK NATIONAL ASSOCIATION, a national
banking association, as an issuing bank (in such capacity, together with its
successors in such capacity, an "ISSUING BANK") and as agent for itself, the
Documentation Agent, the Issuing Banks and the other Banks (in such capacity,
together with its successors in such capacity, the "AGENT").
R E C I T A L S:
A. The Borrowers, the Agent and certain of the Banks previously entered
into that certain Credit Agreement dated as of May 16, 1996, as amended pursuant
to that certain First Amendment to Credit Agreement dated as of September 3,
1996 (as amended, the "EXISTING CREDIT AGREEMENT"), pursuant to which certain of
the Banks extended credit to Holdings in the form of term loans and to HealthCor
in the form of revolving credit loans (collectively, the "EXISTING LOANS").
B. The Borrowers have requested the Banks to (i) make a revolving credit
loan in the form of advances and letters of credit available to HealthCor in an
aggregate principal amount not to exceed $15,000,000.00 outstanding at any time,
a portion of the proceeds of which shall be used to repay the indebtedness of
HealthCor outstanding under the Existing Loan, and (ii) make a term loan
available to Holdings with multiple advances initially available thereunder in
an aggregate principal amount not to exceed $45,000,000.00 outstanding at any
time, which amount may be increased to (a) $52,500,000.00 outstanding at any
time, subject to the condition that Holdings raises at least $5,000,000.00 in
additional equity capital, or (b) $60,000,000.00 outstanding at any time,
subject to the condition that Holdings raises $10,000,000.00 (inclusive of the
aforementioned $5,000,000) in the aggregate in equity capital, as hereinafter
provided.
C. The Banks are willing to make such extensions of credit to the
Borrowers upon the terms and conditions hereinafter set forth.
D. The parties hereto desire to amend the Existing Credit Agreement as
hereinafter provided and have agreed for purposes of clarity and ease of
administration, to amend the
AMENDED AND RESTATED CREDIT AGREEMENT - Page 1
Existing Credit Agreement and then restate the Existing Credit Agreement in its
entirety by means of this Agreement.
NOW THEREFORE, in consideration of the premises and the mutual covenants
herein contained, the parties hereto agree as follows, and the Existing Credit
Agreement is hereby amended and restated in its entirety as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. As used in this Agreement, the following terms
have the following meanings:
"ACQUIRED COMPANY" means, as of any date of calculation of EBITDAA,
a Subsidiary acquired by a Company, or a Person all or substantially all
of the assets of which have been acquired by a Company, in each case,
following the Closing Date.
"ACQUIRED EBITDA" means for each Acquired Company, (a) EBITDA for
such Acquired Company for the twelve (12) month period ended on the date
of calculation, calculated as of the Initial Report Date for such Acquired
Company, multiplied by (b) the EBITDA Factor for such Acquired Company.
"ACQUISITION LINE" means as to each Bank, the nonrevolving line of
credit to be made available to Holdings by such Bank pursuant to Section
3.1.
"ACQUISITION LINE AVAILABLE AMOUNT" means (a) from the Closing Date
until such date as Holdings has demonstrated to the satisfaction of the
Agent and the Required Banks in their sole discretion, that since the
effective date of the initial public offering of its common stock,
Holdings has raised additional equity capital in an aggregate amount in
excess of $5,000,000, $45,000,000; (b) from the date Holdings demonstrates
that it has raised an additional $5,000,000 in equity capital as described
in clause (a) preceding until such time as Holdings demonstrates to the
satisfaction of the Agent and the Required Banks in their sole discretion,
that since the effective date of the initial public offering of its common
stock, Holdings has raised equity capital in an aggregate amount in excess
of $10,000,000, $52,500,000; and (c) following the date Holdings
demonstrates that is has raised equity capital in an aggregate amount in
excess of $10,000,000 as described in clause (b) preceding, $60,000,000.
"ACQUISITION LINE COMMITMENTS" means, as to each Bank, the
obligation of such Bank to make Acquisition Line Loans hereunder in the
aggregate principal amount at any one time outstanding up to but not
exceeding the amount set forth opposite the name of such Bank on the
signature pages hereto under the heading "Acquisition Line Commitment" or
on the signature pages of an Assignment and Acceptance pursuant to which
such Bank assumed its Acquisition Line Commitment, as applicable, as the
same
AMENDED AND RESTATED CREDIT AGREEMENT - Page 2
may be (a) reduced pursuant to Section 3.9 or terminated pursuant to
Section 3.9 or 13.2 and (b) reduced or increased from time to time
pursuant to assignments by or to such Bank pursuant to Section 15.7.
"ACQUISITION LINE LOAN" means as to each Bank, an acquisition line
loan made by such Bank pursuant to Section 3.1.
"ACQUISITION LINE MATURITY DATE" means 11:00 a.m. Houston, Texas
time on October 31, 2001.
"ACQUISITION LINE NOTE" means a promissory note of Holdings payable
to the order of a Bank evidencing an Acquisition Line Loan, in
substantially the form of Exhibit "A-2" hereto, and all extensions,
renewals, and modifications thereof and all substitutions therefor.
"ACQUISITION LINE TERMINATION DATE" means 11:00 a.m. Houston, Texas
time on October 31, 1998.
"ADDITIONAL COSTS" has the meaning specified in Section 6.1.
"ADJUSTED EURODOLLAR RATE" means, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (rounded upwards, if
necessary, to the nearest 1/16 of 1%) determined by the Agent to be equal
to the Eurodollar Rate for such Eurodollar Loan for such Interest Period
divided by 1 minus the Reserve Requirement for such Eurodollar Loan for
such Interest Period.
"ADJUSTMENT DATE" means the last day of each calendar quarter.
"AFFILIATE" means, as to any Person, any other Person (a) that
directly or indirectly, through one or more intermediaries, controls or is
controlled by, or is under common control with, such Person; (b) that
directly or indirectly beneficially owns or holds five percent or more of
any class of voting stock of such Person; or (c) five percent or more of
the voting stock of which is directly or indirectly beneficially owned or
held by the Person in question. The term "control" means the possession,
directly or indirectly, of the power to direct or cause direction of the
management and policies of a Person, whether through the ownership of
voting securities, by contract, or otherwise; PROVIDED, however, in no
event shall the Agent, the Documentation Agent, any Issuing Bank or any
Bank be deemed an Affiliate of either Borrower or any of the Subsidiaries.
"AGENT'S FEE LETTER" means the letter agreement dated June 7, 1996,
among the Agent, Chase Securities Inc. and Holdings.
"ALTERNATE BASE RATE" means, for any day, a rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to the greater of (a)
the Prime Rate in effect on such day, or (b) the Federal Funds Effective
Rate in effect on such day plus 1/2 of
AMENDED AND RESTATED CREDIT AGREEMENT - Page 3
1%. For purposes hereof: "PRIME RATE" shall mean the rate of interest per
annum publicly announced from time to time by the Agent as its prime rate
in effect at its principal office in Houston, Texas; and "FEDERAL FUNDS
EFFECTIVE RATE" shall mean, for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a Business Day, the
average of the quotations for the day of such transactions received by the
Agent from three federal funds brokers of recognized standing selected by
it. If for any reason the Agent determines (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the
Federal Funds Effective Rate, for any reason, including the inability or
failure of the Agent to obtain sufficient quotations in accordance with
the terms hereof, the Alternate Base Rate shall be determined without
regard to clause (b) of the first sentence of this definition, as
appropriate, until the circumstances giving rise to such inability no
longer exist. Any change in the Alternate Base Rate due to a change in the
Prime Rate or the Federal Funds Effective Rate shall be effective on the
effective day of such change in the Prime Rate or the Federal Funds
Effective Rate, respectively.
"ALTERNATE BASE RATE LOANS" means Loans, the interest rates on which
are determined on the basis of the rates referred to in the definition of
"Alternate Base Rate" in this Section 1.1.
"APPLICABLE COMMITMENT FEE RATE" means, for any day, a per annum
percentage rate that is subject to adjustment (upwards or downwards, as
appropriate) based on the Funded Debt to EBITDAA Ratio. Effective as of
the last day of each calendar quarter (each an "ADJUSTMENT DATE") the
Applicable Commitment Fee Rate shall be adjusted to reflect the Applicable
Commitment Fee Rate prescribed below for the Funded Debt to EBITDAA Ratio
as demonstrated by the Compliance Certificate delivered for that quarter:
=====================================================================
APPLICABLE COMMITMENT
FUNDED DEBT TO EBITDAA RATIO FEE RATE
=====================================================================
Less than 1.00 to 1.00 .250%
---------------------------------------------------------------------
Greater than or equal to 1.00 to 1.00, but less
than 1.75 to 1.00 .250%
---------------------------------------------------------------------
Greater than or equal to 1.75 to 1.00, but less
than 2.50 to 1.00 .375%
---------------------------------------------------------------------
Greater than or equal to 2.50 to 1.00 .375%
=====================================================================
The Applicable Commitment Fee Rate shall be .250% from the date hereof
until the first Adjustment Date after the date hereof that the Compliance
Certificate demonstrates a change in the Funded Debt to EBITDAA Ratio to
an amount so that another Applicable Commitment Fee Rate shall be applied.
After each adjustment of the Applicable
AMENDED AND RESTATED CREDIT AGREEMENT - Page 4
Commitment Fee Rate in accordance herewith, the new Applicable Commitment
Fee Rate shall apply until the next Adjustment Date that the Compliance
Certificate demonstrates a change in the Funded Debt to EBITDAA Ratio to
an amount so that another Applicable Commitment Fee Rate shall be applied.
Upon the request of the Agent, the Borrowers must demonstrate to the
reasonable satisfaction of the Required Banks the required applicable
ratio in order to obtain an adjustment to a lower Applicable Commitment
Fee Rate. If the Borrowers fail to furnish to the Agent any Compliance
Certificate by the date required by this Agreement, then the maximum
Applicable Commitment Fee Rate shall apply until the Borrowers furnish the
required Compliance Certificate to the Agent.
"APPLICABLE LENDING OFFICE" means for each Bank and each Type of
Loan, the Lending Office of such Bank (or of an Affiliate of such Bank)
designated for such Type of Loan below its name on the signature pages
hereof or such other office of such Bank (or of an Affiliate of such Bank)
as such Bank may from time to time specify to the Borrower and the Agent
as the office by which its Loans of such Type are to be made and
maintained.
"APPLICABLE MARGIN" means, for any day, the margin of interest over
the Eurodollar Rate or Alternate Base Rate, as the case may be, that is
applicable when any Applicable Rate based on the Eurodollar Rate or the
Alternate Base Rate is determined under this Agreement. The Applicable
Margin is subject to adjustment (upwards or downwards, as appropriate)
based on the Funded Debt to EBITDAA Ratio. Effective as of each Adjustment
Date the Applicable Margin for each type of Loan shall be adjusted to
reflect the Applicable Margin prescribed below for the Funded Debt to
EBITDAA Ratio as demonstrated by the Compliance Certificate delivered for
that quarter:
=============================================================================
FUNDED DEBT TO EURODOLLAR RATE ALTERNATE BASE RATE
EBITDAA RATIO APPLICABLE MARGIN APPLICABLE RATE
=============================================================================
Less than 1.00 to 1.00 1.25% 0%
-----------------------------------------------------------------------------
Greater than or equal to 1.00 to 1.75% 0%
1.00, but less than 1.75 to 1.00
-----------------------------------------------------------------------------
Greater than or equal to 1.75 to 2.25% .250%
1.00, but less than 2.50 to 1.00
-----------------------------------------------------------------------------
Greater than or equal to 2.50 to 2.75% .750%
1.00
=============================================================================
The Applicable Margin shall be 0.0% with respect to the Alternate Base
Rate and 1.75% with respect to the Eurodollar Rate from the date hereof
until the first Adjustment Date after the date hereof that the Compliance
Certificate demonstrates a change in the Funded Debt to EBITDAA Ratio to
an amount such that another Applicable Margin shall be applied. After each
adjustment of the Applicable Margin for each Type of Loan in accordance
herewith, the new Applicable Margin for each Type of Loan shall apply to
AMENDED AND RESTATED CREDIT AGREEMENT - Page 5
all Loans of each such Type thereafter outstanding or made until the next
Adjustment Date that the Compliance Certificate demonstrates a change in
the Funded Debt to EBITDAA Ratio to an amount such that another Applicable
Margin shall be applied. Upon the request of the Agent, the Borrowers must
demonstrate to the reasonable satisfaction of the Required Banks the
required applicable ratio in order to obtain an adjustment to a lower
applicable margin for each Type of Loan. If the Borrowers fail to furnish
to the Agent any Compliance Certificate by the date required by this
Agreement, then the maximum Applicable Margin shall apply to all Loans of
each such Type thereafter outstanding or made until the Borrowers furnish
the required Compliance Certificate to the Agent.
"APPLICABLE RATE" means: (a) during the period that a Loan is an
Alternate Base Rate Loan, the Alternate Base Rate plus the Applicable
Margin; and (b) during the period that a Loan is a Eurodollar Loan, the
Adjusted Eurodollar Rate plus the Applicable Margin.
"ASSIGNEE" has the meaning assigned to it in Section 15.7(b).
"ASSIGNING BANK" has the meaning assigned to it in Section 15.7(b).
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Bank and its assignee and accepted by the Agent pursuant
to Section 15.7, in substantially the form of Exhibit "J" hereto.
"ASSIGNMENTS OF LIFE INSURANCE" shall have the meaning specified in
Section 7.1(d).
"BORROWER SECURITY AGREEMENT" means the Amended and Restated
Security Agreement of the Borrowers in favor of the Agent for the benefit
of the Agent, the Documentation Agent, the Banks and the Issuing Banks, in
substantially the form of Exhibit "D-1" hereto, as the same may be
amended, supplemented, or modified.
"BUSINESS DAY" means (a) a day other than Saturday, Sunday or day on
which commercial banks in Houston, Texas or New York, New York are not
authorized or required to close, and (b) with respect to all borrowings,
payments, Conversions, Continuations, Interest Periods, and notices in
connection with Eurodollar Loans, any day which is a Business Day
described in clause (a) above and which is also a day on which dealings in
Dollar deposits are carried out in the Eurodollar interbank market.
"CAPITAL LEASE OBLIGATIONS" means, as to any Person, the obligations
of such Person to pay rent or other amounts under a lease of (or other
agreement conveying the right to use) real and/or personal property, which
obligations are required to be classified and accounted for as a capital
lease on a balance sheet of such Person under GAAP. For purposes of this
Agreement, the amount of such Capital Lease Obligations shall be the
capitalized amount thereof, determined in accordance with GAAP.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 6
"CLOSING DATE" means October 31, 1996, which shall be the date of
the closing of the transactions contemplated by this Agreement and
delivery of the items required to be delivered pursuant to Section 8.1.
"CODE" means the Internal Revenue Code of 1986, as amended, and the
regulations promulgated and rulings issued thereunder.
"COLLATERAL" has the meaning specified in Section 7.1.
"COMMITMENTS" means, as to each Bank, its Revolving Credit
Commitment and its Acquisition Line Commitment.
"COMPANIES" means Holdings and (a) all of its affiliated entities
including, without limitation, those entities described on Schedule 1
hereto, (b) all of its Subsidiaries and all Subsidiaries of any other
present or future Company formed or acquired after the date of this
Agreement, and (c) the successors and assigns of each of the foregoing
entities.
"COMPLIANCE CERTIFICATE" means a certificate in substantially the
form of Exhibit "K" hereto delivered by the Borrowers to the Agent
pursuant to Section 10.1(c).
"CONSOLIDATED NET WORTH" means, at any particular time, all amounts
which, in conformity with GAAP, would be included as stockholders' equity
on a consolidated balance sheet of the Companies.
"CONTINUE," "CONTINUATION," and "CONTINUED" shall refer to the
continuation pursuant to Section 5.2 of a Eurodollar Loan as a Eurodollar
Loan from one Interest Period to the next Interest Period.
"CONTRIBUTION AND INDEMNIFICATION AGREEMENT" has the meaning
specified in Section 8.1(o).
"CONVERT," "CONVERSION," and "CONVERTED" shall refer to a conversion
pursuant to Section 5.2 or Article VI of one Type of Loan into another
Type of Loan.
"DEFAULT" means an Event of Default or the occurrence of an event or
condition which with notice or lapse of time or both would become an Event
of Default.
"DEFAULT RATE" means the lesser of (i) the Maximum Rate, or (ii) the
sum of the Applicable Rate in effect from day to day, plus four percent
(4%).
"DOCUMENTATION AGENT" means First Chicago.
"DOCUMENTATION AGENT'S FEE LETTER" means the letter agreement dated
June 7, 1996 between the Documentation Agent and Holdings.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 7
"DOLLARS" and "$" mean lawful money of the United States of America.
"EBITDA" means, for any Person for any period, the sum of the
following for such period determined in accordance with GAAP on a
consolidated basis: (a) net income before provision for income taxes, PLUS
(b) Interest Expense, PLUS (c) depreciation, amortization and other
non-cash charges to the extent actually deducted in arriving at net
income, MINUS (d) extraordinary income, PLUS (e) extraordinary losses,
MINUS (f) depreciation, relating to the Rockwell Project.
"EBITDA FACTOR" means, for each Acquired Company, as of any date of
calculation of EBITDAA, the percentage set forth below corresponding to
the Initial Report Date for such Acquired Company, relative to such date
of calculation of EBITDAA:
==========================================================
INITIAL REPORT DATE EBITDA FACTOR
----------------------------------------------------------
Same as date of calculation of EBITDAA 1.000
----------------------------------------------------------
Last day of first calendar month prior to .917
date of calculation of EBITDAA
----------------------------------------------------------
Last day of second calendar month prior .833
to date of calculation of EBITDAA
----------------------------------------------------------
Last day of third calendar month prior to .750
date of calculation of EBITDAA
----------------------------------------------------------
Last day of fourth calendar month prior to .667
date of calculation of EBITDAA
----------------------------------------------------------
Last day of fifth calendar month prior to .583
date of calculation of EBITDAA
----------------------------------------------------------
Last day of sixth calendar month prior to .500
date of calculation of EBITDAA
----------------------------------------------------------
Last day of seventh calendar month prior .417
to date of calculation of EBITDAA
----------------------------------------------------------
Last day of eighth calendar month prior .333
to date of calculation of EBITDAA
----------------------------------------------------------
Last day of ninth calendar month prior to .250
date of calculation of EBITDAA
----------------------------------------------------------
Last day of tenth calendar month prior to .167
date of calculation of EBITDAA
----------------------------------------------------------
Last day of eleventh calendar month prior .083
to date of calculation of EBITDAA
----------------------------------------------------------
Last day of twelfth calendar month prior 0.000
to date of calculation of EBITDAA
==========================================================
"EBITDAA" means, for any period, the sum of (a) EBITDA for the
Companies on a consolidated basis for such period, PLUS (b) the Acquired
EBITDA for all Acquired
AMENDED AND RESTATED CREDIT AGREEMENT - Page 8
Companies for such period, plus (c) the Historical Acquired EBITDA for all
Historical Acquired Companies for such period.
"ELIGIBLE ASSIGNEE" means any commercial bank, savings and loan
association, savings bank or other financial institution having capital
and surplus of at least $100,000,000 and reasonably acceptable to the
Agent.
"ENVIRONMENTAL LAWS" means any and all federal, state, and local
laws, regulations, and requirements pertaining to health, safety, or the
environment, as such laws, regulations, and requirements may be amended or
supplemented from time to time.
"ENVIRONMENTAL LIABILITIES" means, as to any Person, all
liabilities, obligations, responsibilities, remedial actions, losses,
damages, costs, and expenses (including, without limitation, all
reasonable fees, disbursements and expenses of counsel, expert and
consulting fees and costs of investigation and feasibility studies),
fines, penalties, sanctions, and interest arising from environmental,
health or safety conditions or the Release or threatened Release of a
Hazardous Material into the environment, resulting from the past, present,
or future operations of such Person or its Affiliates.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, and the regulations and published
interpretations thereunder.
"ERISA AFFILIATE" means any corporation or trade or business which
is a member of the same controlled group of corporations (within the
meaning of Section 414(b) of the Code) as the Borrowers or is under common
control (within the meaning of Section 414(c) of the Code) with the
Borrowers.
"EURODOLLAR LOANS" means Loans the interest rates on which are
determined on the basis of the rates referred to in the definition of
"Adjusted Eurodollar Rate" in this Section 1.1.
"EURODOLLAR RATE" means, for any Eurodollar Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/16 of 1%) at which the Reference Bank or any of its Affiliates
is offered Dollar deposits at or about 10:00 A.M., New York City time, two
Business Days prior to the first day of such Interest Period in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of its Eurodollar Loans are then being
conducted for delivery on the first day of such Interest Period for a
number of days comprised therein and in an amount comparable to the
principal amount of the Eurodollar Loan to which such Interest Period
relates.
"EVENT OF DEFAULT" has the meaning specified in Section 13.1.
"EXCESS CASH FLOW" means, for any Person for any period, the sum of
the following determined in accordance with GAAP on a consolidated basis:
(a) net income,
AMENDED AND RESTATED CREDIT AGREEMENT - Page 9
PLUS (b) depreciation, amortization, non-cash taxes and other non-cash
charges to the extent actually deducted in arriving at net income for such
period, MINUS (c) other non-cash gains, MINUS (d) total scheduled
principal payments on long term debt during such period, MINUS (e)
optional principal prepayments on the outstanding Acquisition Line Loans
during such period, MINUS (f) Unleveraged Nonreimbursed Capital
Expenditures made during such period, MINUS (g) total scheduled payments
made in respect of Capital Lease Obligations.
"EXISTING LOANS" has the meaning specified in the Recitals hereto.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/16 of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members
of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day, provided that (a) if the day for which such
rate is to be determined is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b)
if such rate is not so published on such next succeeding Business Day, the
Federal Funds Rate for any day shall be the average rate charged to the
Agent on such day on such transactions as determined by the Agent.
"FEE LETTERS" means collectively, the Agent's Fee Letter and the
Documentation Agent's Fee Letter.
"FIRST CHICAGO" means The First National Bank of Chicago, a national
banking association.
"FIXED CHARGE COVERAGE RATIO" means, for any period, the ratio
determined on a consolidated basis of (a) EBITDAA, less (i) cash taxes
paid by the Companies during such period, LESS (ii) the Unleveraged
Nonreimbursed Capital Expenditures for such period TO (b) the sum of (i)
the total current maturities of long term debt and current maturities of
Capital Lease Obligations of the Companies determined in accordance with
GAAP, PLUS (ii) the Interest Expense of the Companies for such period.
"FUNDED DEBT" means at any time (without duplication): (a) all
obligations of the Companies, or any of them, for borrowed money and all
obligations of the Companies, or any of them, evidenced by bonds, notes,
debentures, or other similar instruments, including without limitation the
indebtedness of the Borrowers pursuant to this Agreement, (b) all Capital
Lease Obligations of the Companies, or any of them, (c) all debt or other
obligations of others Guaranteed by the Companies, or any of them, (d) all
reimbursement obligations of the Companies, or any of them (whether
contingent or otherwise) in respect of letters of credit, bankers'
acceptances, surety or other bonds and similar instruments, (e) all
obligations of the Companies, or any of them, to pay the deferred purchase
price of property or services, except trade accounts payable of the
AMENDED AND RESTATED CREDIT AGREEMENT - Page 10
Companies, or any of them, arising in the ordinary course of business that
are not past due by more than ninety (90) days, (f) all obligations
secured by a Lien existing on property owned by the Companies, or any of
them, whether or not the obligations secured thereby have been assumed by
the Companies, or any of them, or are non-recourse to the credit of the
Companies, or any of them, and (g) all other debt of the Companies, or any
of them.
"FUNDED DEBT TO EBITDAA RATIO" means, at any time, the ratio of
Funded Debt to EBITDAA.
"GAAP" means generally accepted accounting principles, applied on a
consistent basis, as set forth in Opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants and/or in
statements of the Financial Accounting Standards Board and/or their
respective successors and which are applicable in the circumstances as of
the date in question. Accounting principles are applied on a "consistent
basis" when the accounting principles applied in a current period are
comparable in all material respects to those accounting principles applied
in a preceding period.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state
or political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory, or administrative functions of or
pertaining to government.
"GUARANTEE" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any debt or
other obligation of any other Person and, without limiting the generality
of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person (a) to purchase or pay (or advance or supply
funds for the purchase or payment of) such debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise)
or (b) entered into for the purpose of assuring in any other manner the
obligee of such debt or other obligation of the payment thereof or to
protect the obligee against loss in respect thereof (in whole or in part),
provided that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business. The term
"Guarantee" used as a verb has a corresponding meaning.
"GUARANTIES" means (i) the amended and restated guaranty of the
respective Guarantors in favor of the Agent for the benefit of the Agent,
the Documentation Agent, the Issuing Banks and the Banks, in substantially
the form of Exhibit "E-1" hereto, as the same may be amended, supplemented
or modified, (ii) the guaranties, each in substantially the form of
Exhibit "E-1" hereto, hereafter executed by any Companies formed or
acquired after the date of this Agreement, as the same may be amended,
supplemented or modified, and (iii) the amended and restated guaranty of
the Borrowers with respect to the Obligations of the other Borrower, in
substantially the form of Exhibit "E-2" hereto, as the same may be
amended, supplemented or modified.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 11
"GUARANTORS" means the Companies other than the Borrowers.
"HAZARDOUS MATERIAL" means any substance, product, waste, pollutant,
material, chemical, contaminant, constituent, or other material which is
or becomes listed, regulated, or addressed under any Environmental Law,
including, without limitation, asbestos, petroleum, and polychlorinated
biphenyls.
"HEALTH CARE REGULATORS" means all federal and state governmental
regulators and accreditation agencies and their respective official
intermediaries and/or carriers, including without limitation the Texas
Department of Health, and the Health Care Financing Administration and its
intermediary and/or carrier.
"HISTORICAL ACQUIRED COMPANY" means, as of any date of calculation
of EBITDAA, a Subsidiary acquired by a Company, or a Person all or
substantially all of the assets of which have been acquired by a Company,
in each case, prior to the Closing Date.
"HISTORICAL ACQUIRED EBITDA" means for each Historical Acquired
Company the amount of EBITDA set forth next to the relevant date of
calculation and the name of such Historical Acquired Company on Schedule 5
attached hereto.
"HOME" means HealthCor Oxygen and Medical Equipment, Inc. (formerly
known as Permian Medical, Inc. and successor in interest by merger to
Colfax Medical Service and Supply, Inc., β.β. Supply & Service, Inc. and
Arlington Diversified Medical Equipment, Inc.), a Texas corporation.
"INITIAL REPORT DATE" for an Acquired Company means either (a) the
last day of the calendar month immediately preceding the calendar month in
which the stock or assets of such Acquired Company are acquired by a
Company, or (b) if the requisite financial information cannot be
determined for the dates or periods set forth in clause (a) above, then
the last day of another preceding calendar month approved by the Required
Banks.
"INTEREST EXPENSE" means for any Person for any period of
calculation thereof, all interest (whether accrued as a liability and
payable in cash or imputed) on debt, liabilities or other obligations of
such Person during such period.
"INTEREST PERIOD" means with respect to any Eurodollar Loans, each
period commencing on the date such Loan is made or converted from an
Alternate Base Rate Loan or, in the case of each subsequent, successive
Interest Period applicable to a Eurodollar Loan, the last day of the next
preceding Interest Period with respect to such Loan, and ending on the
numerically corresponding day in the first, second, third or sixth
calendar month thereafter, as the applicable Borrower may select as
provided in Section 5.1, except that each such Interest Period which
commences on the last Business Day of a calendar month (or on any day for
which there is no numerically corresponding day in the appropriate
subsequent calendar month) shall end on the last Business Day of
AMENDED AND RESTATED CREDIT AGREEMENT - Page 12
the appropriate subsequent calendar month. Notwithstanding the foregoing:
(a) each Interest Period which would otherwise end on a day which is not a
Business Day shall end on the next succeeding Business Day (or, if such
succeeding Business Day falls in the next succeeding calendar month, on
the next preceding Business Day); (b) any Interest Period for a Eurodollar
Loan which would otherwise extend beyond the maturity date of the Note
evidencing such Eurodollar Loan shall end on the maturity date of such
Note; (c) no more than six (6) Interest Periods shall be in effect at the
same time; (d) no Interest Period shall have a duration of less than one
(1) month and, if the Interest Period would otherwise be a shorter period,
Eurodollar Loans shall not be available hereunder, and (e) no Interest
Period for any Loans may extend beyond a principal repayment date unless,
after giving effect thereto, the aggregate principal amount of the
Eurodollar Loans having Interest Periods that end after such principal
payment date shall be equal to or less than the Loans to be outstanding
hereunder after such principal payment date.
"ISSUING BANK" means, with respect to any Letter of Credit, TCB or
any of its Affiliates or, with the approval of the Agent, any other Bank
which chooses to be an Issuing Bank hereunder, in its capacity as issuer
of a Letter of Credit.
"L/C APPLICATION" has the meaning specified in Section 4.1.
"L/C DOCUMENTS" has the meaning specified in Section 4.1.
"LC PARTICIPATION" means, with respect to any Bank at any time, the
amount of the participating interest held by such Bank in respect of a
Letter of Credit.
"LETTER OF CREDIT" means any standby letter of credit issued by an
Issuing Bank for the account of HealthCor pursuant to Article IV.
"LETTER OF CREDIT LIABILITIES" means, at any time, the aggregate
face amounts of all outstanding Letters of Credit and the aggregate amount
of any unreimbursed payments made in respect of any drawing under a Letter
of Credit.
"LETTER OF CREDIT REQUEST FORM" means a certificate, in
substantially the form of Exhibit "C" hereto, properly completed and
signed by HealthCor requesting issuance of a Letter of Credit.
"LIEN" means any lien, mortgage, security interest, tax lien,
financing statement, pledge, charge, hypothecation, assignment,
preference, priority, or other encumbrance of any kind or nature
whatsoever (including, without limitation, any conditional sale or title
retention agreement), whether arising by contract, operation of law, or
otherwise.
"LOAN DOCUMENTS" means this Agreement and all promissory notes,
security agreements, pledge agreements, deeds of trust, fee letters,
assignments, guaranties, letters of credit, letter of credit applications
and other instruments, documents, and agreements executed and delivered
pursuant to or in connection with this Agreement, as such
AMENDED AND RESTATED CREDIT AGREEMENT - Page 13
instruments, documents, and agreements may be amended, modified, renewed,
extended, or supplemented from time to time.
"LOAN REQUEST FORM" means a certificate, in substantially the form
of Exhibit "B-1" hereto, properly completed and signed by HealthCor with
respect to Revolving Credit Loans or Holdings with respect to Acquisition
Line Loans, requesting a Loan.
"LOANS" means the Revolving Credit Loans and the Acquisition Line
Loans.
"MAXIMUM RATE" means, at any time and with respect to any Bank, the
maximum rate of interest under applicable law that such Bank may charge
the Borrowers. The Maximum Rate shall be calculated in a manner that takes
into account any and all fees, payments, and other charges in respect of
the Loan Documents that constitute interest under applicable law. Each
change in any interest rate provided for herein based upon the Maximum
Rate resulting from a change in the Maximum Rate shall take effect without
notice to the Borrowers at the time of such change in the Maximum Rate.
For purposes of determining the Maximum Rate under Texas law, the
applicable rate ceiling shall be the indicated rate ceiling described in,
and computed in accordance with, Article 5069-1.04, Vernon's Texas Civil
Statutes.
"MULTIEMPLOYER PLAN" means a multiemployer plan defined as such in
Section 3(37) of ERISA to which contributions have been made by Holdings
or any ERISA Affiliate and which is covered by Title IV of ERISA.
"NOTES" means the Revolving Credit Notes and the Acquisition Line
Notes.
"NOTICE OF CONTINUATION OR CONVERSION" means a certificate, in
substantially the form of Exhibit "B-2" hereto, properly completed and
signed by the applicable Borrower requesting the conversion of a Loan from
one Type into another Type or the continuation of a Eurodollar Loan.
"OBLIGATED PARTY" means any Guarantor or any other Person who is or
becomes party to any agreement that guarantees or secures payment and
performance of the Obligations or any part thereof.
"OBLIGATIONS" means all obligations, indebtedness, and liabilities
of the Borrowers to the Agent, the Documentation Agent, the Issuing Banks
and the Banks, their successors and assigns, or any of them, arising
pursuant to any of the Loan Documents, now existing or hereafter arising,
whether direct, indirect, related, unrelated, fixed, contingent,
liquidated, unliquidated, joint, several, or joint and several, including,
without limitation, the obligations, indebtedness, and liabilities of the
Borrowers under this Agreement and the other Loan Documents (including,
without limitation, all of HealthCor's contingent reimbursement
obligations in respect of Letters of Credit), and all interest accruing
AMENDED AND RESTATED CREDIT AGREEMENT - Page 14
thereon and all attorneys' fees and other expenses incurred in the
enforcement or collection thereof.
"OPERATING LEASE" means any lease (other than a lease constituting a
Capital Lease Obligation) of real or personal property.
"PAYOR" has the meaning assigned to it in Section 5.6.
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
succeeding to all or any of its functions under ERISA.
"PERMITTED DEBT" has the meaning specified in Section 11.1.
"PERMITTED LIENS" has the meaning specified in Section 11.2.
"PERSON" means any individual, corporation, business trust,
association, company, partnership, joint venture, Governmental Authority,
or other entity.
"PHARMACY" means HealthCor Pharmacy, Inc., a Texas corporation.
"PLAN" means any employee benefit or other plan established or
maintained by Holdings or any ERISA Affiliate and which is covered by
Title IV of ERISA.
"PLEDGE AGREEMENT" means that certain amended and restated pledge
agreement in favor of the Agent for the benefit of the Agent, the
Documentation Agent, the Issuing Banks and the Banks, in substantially the
form of Exhibit "F" hereto, as the same may be amended, supplemented or
modified.
"PREFERRED STOCK" shall mean HealthCor's Convertible Series A and
Series B Preferred Stock, $.01 par value.
"PREFERRED STOCK PURCHASE AGREEMENTS" means Holdings' Convertible
Preferred Stock Purchase Agreement dated October 18, 1989, as amended, and
Series B Convertible Preferred Stock Purchase Agreement dated June 1,
1992, as amended.
"PRINCIPAL OFFICE" means the principal office of the Agent,
presently located at βββ ββββββ, βββββββ, βββββ βββββ.
"PROHIBITED TRANSACTION" means any transaction set forth in Section
406 of ERISA or Section 4975 of the Code.
"QUARTERLY PAYMENT DATE" means the first day of each January, April,
July and October of each year, the first of which shall be the first such
day after the date of this Agreement.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 15
"REFERENCE BANK" means Texas Commerce Bank National Association.
"REGISTER" has the meaning assigned to it in Section 15.7(d).
"REGULATION D" means Regulation D of the Board of Governors of the
Federal Reserve System as the same may be amended or supplemented from
time to time.
"REGULATORY CHANGE" means, with respect to any Bank, any change
after the date of this Agreement in United States federal, state, or
foreign laws or regulations (including Regulation D) or the adoption or
making after such date of any interpretations, directives, or requests
applying to a class of banks including such Bank of or under any United
States federal or state, or any foreign, laws or regulations (whether or
not having the force of law) by any court or governmental or monetary
authority charged with the interpretation or administration thereof.
"REPORTABLE EVENT" means any of the events set forth in Section 4043
of ERISA.
"REQUIRED BANKS" means at any time while no Loans or Letter of
Credit Liabilities are outstanding, Banks having at least 66-2/3% of the
aggregate amount of the Commitments and, at any time while Loans or Letter
of Credit Liabilities are outstanding, Banks holding at least 66-2/3% of
the outstanding aggregate principal amount of the Loans and LC
Participations.
"REQUIRED PAYMENT" has the meaning assigned to it in Section 5.6.
"RESERVE REQUIREMENT" means, for any Eurodollar Loan for any
Interest Period therefor, the average maximum rate at which reserves
(including any marginal, supplemental or emergency reserves) are required
to be maintained during such Interest Period under Regulation D by member
banks of the Federal Reserve System in New York City with deposits
exceeding one billion Dollars against "Eurocurrency Liabilities" as such
term is used in Regulation D. Without limiting the effect of the
foregoing, the Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks by reason of any Regulatory
Change against (i) any category of liabilities which includes deposits by
reference to which the Adjusted Eurodollar Rate is to be determined, or
(ii) any category of extensions of credit or other assets which include
Eurodollar Loans.
"REVOLVING CREDIT COMMITMENT" means, as to each Bank, the obligation
of such Bank to make Revolving Credit Loans and purchase participations in
Letters of Credit pursuant to Section 4.1 in an aggregate principal amount
at any one time outstanding up to but not exceeding the amount set forth
opposite the name of such Bank on the signature pages hereto under the
heading "Revolving Credit Commitment," or in the Assignment and Acceptance
pursuant to which such Bank assumed its Revolving Credit Commitment, as
applicable, as the same may be (a) reduced pursuant to Section 2.7 or
AMENDED AND RESTATED CREDIT AGREEMENT - Page 16
terminated pursuant to Section 2.7 or 13.2 and (b) reduced or increased
from time to time pursuant to assignments by or to such Bank pursuant to
Section 15.7.
"REVOLVING CREDIT LOAN" means, as to each Bank, the loans to be made
by such Bank pursuant to Section 2.1.
"REVOLVING CREDIT NOTE" means a promissory note of HealthCor payable
to the order of a Bank, in substantially the form of Exhibit "A-1" hereto,
and all extensions, renewals, and modifications thereof and all
substitutions therefor.
"REVOLVING CREDIT TERMINATION DATE" means 11:00 A.M. Houston, Texas
time on October 31, 1999, or such earlier date and time on which the
Revolving Credit Commitments terminate as provided in this Agreement.
"RICO" means the Racketeer Influenced and Corrupt Organization Act
of 1970, as amended from time to time.
"ROCKWELL PROJECT" means that certain software consulting and design
project conducted pursuant to a consulting agreement with Rockwell
International.
"SECURITY AGREEMENTS" means (i) the amended and restated security
agreements in favor of the Agent for the benefit of the Agent, the
Documentation Agent, the Issuing Banks and the Banks, in the form of
Exhibit "D-1" hereto for the Borrowers or Exhibit "D-2" hereto for the
Guarantors, as the same may be amended, supplemented or modified, and (ii)
the Security Agreements, each in substantially the form of Exhibit "D-2"
hereto, hereafter executed by any Companies formed or acquired after the
date of this Agreement, as the same may be amended, supplemented or
modified.
"SUBSIDIARY" means any corporation of which at least a majority of
the outstanding shares of stock having by the terms thereof ordinary
voting power to elect a majority of the board of directors of such
corporation (irrespective of whether or not at the time stock of any other
class or classes of such corporation shall have or might have voting power
by reason of the happening of any contingency) is at the time directly or
indirectly owned or controlled by Holdings or one or more of the
Subsidiaries or by Holdings and one or more of the Subsidiaries.
"TERMINATION DATE" means, with respect to the Revolving Credit
Commitments, the Revolving Credit Termination Date, and with respect to
the Acquisition Line Commitments, the Acquisition Line Termination Date.
"TYPE" means any type of Loan (i.e., Alternate Base Rate Loan or
Eurodollar Loan).
"UCC" means the Uniform Commercial Code as in effect in the State of
Texas.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 17
"UNLEVERAGED NONREIMBURSED CAPITAL EXPENDITURES" means, for any
period of determination, the total capital expenditures of the Companies
LESS increases in long term Debt directly associated with those
expenditures LESS any reimbursements of such expenditures paid in cash by
Medicare during such period.
Section 1.2 OTHER DEFINITIONAL PROVISIONS. All definitions contained in
this Agreement are equally applicable to the singular and plural forms of the
terms defined. The words "hereof," "herein," and "hereunder" and words of
similar import referring to this Agreement refer to this Agreement as a whole
and not to any particular provision of this Agreement. Unless otherwise
specified, all Article and Section references pertain to this Agreement. All
accounting terms not specifically defined herein shall be construed in
accordance with GAAP. Terms used herein that are defined in the UCC, unless
otherwise defined herein, shall have the meanings specified in the UCC.
ARTICLE II
REVOLVING CREDIT LOANS
Section 2.1 REVOLVING CREDIT COMMITMENTS. Subject to the terms and
conditions of this Agreement, each Bank severally agrees to make one or more
Revolving Credit Loans to HealthCor from time to time from the date hereof to
and including the Revolving Credit Termination Date in an aggregate principal
amount at any time outstanding up to but not exceeding the amount of such Bank's
Revolving Credit Commitment as then in effect, provided that the aggregate
amount of all Revolving Credit Loans at any time outstanding shall not exceed
the aggregate amount of the Revolving Credit Commitments minus the outstanding
Letter of Credit Liabilities. Subject to the foregoing limitations, and the
other terms and provisions of this Agreement, HealthCor may borrow, repay, and
reborrow hereunder the amount of the Revolving Credit Commitments by means of
Alternate Base Rate Loans and Eurodollar Loans and, until the Revolving Credit
Termination Date, HealthCor may Convert Loans of one Type into Loans of another
Type. Loans of each Type made by each Bank shall be made and maintained at such
Bank's Applicable Lending Office for Loans of such Type.
Section 2.2 REVOLVING CREDIT NOTES. The obligation of HealthCor to repay
each Bank for Revolving Credit Loans made by such Bank and interest thereon
shall be evidenced by a Revolving Credit Note executed by HealthCor, payable to
the order of such Bank, in the principal amount of such Bank's Revolving Credit
Commitment, and dated the date hereof or such later date as may be required with
respect to transactions contemplated by Section 15.7.
Section 2.3 REPAYMENT OF REVOLVING CREDIT LOANS. HealthCor shall repay the
unpaid principal amount of all Revolving Credit Loans on the Revolving Credit
Termination Date.
Section 2.4 INTEREST. The unpaid principal amount of the Revolving Credit
Loans shall bear interest at a varying rate per annum equal from day to day to
the lesser of (a) the Maximum Rate, or (b) the Applicable Rate. If at any time
the Applicable Rate for any Revolving Credit Loan shall exceed the Maximum Rate,
thereby causing the interest accruing on
AMENDED AND RESTATED CREDIT AGREEMENT - Page 18
such Revolving Credit Loan to be limited to the Maximum Rate, then any
subsequent reduction in the Applicable Rate for such Revolving Credit Loan shall
not reduce the rate of interest on such Revolving Credit Loan below the Maximum
Rate until the aggregate amount of interest accrued on such Revolving Credit
Loan equals the aggregate amount of interest which would have accrued on such
Revolving Credit Loan if the Applicable Rate had at all times been in effect.
Accrued and unpaid interest on the Revolving Credit Loans shall be due and
payable as follows:
(i) in the case of Alternate Base Rate Loans, on each Quarterly
Payment Date;
(ii) in the case of each Eurodollar Loan, on the last day of the
Interest Period with respect thereto and in the case of an Interest Period
with a duration greater than three months, on the last day of each third
month during such Interest Period;
(iii) upon the payment or prepayment of any Revolving Credit Loan or
the Conversion of any Loan to a Loan of another Type (but only on the
principal amount so paid, prepaid, or Converted); and
(iv) on the Revolving Credit Termination Date.
Notwithstanding the foregoing, any outstanding principal of any Revolving Credit
Loan and (to the fullest extent permitted by law) any other amount payable by
HealthCor under this Agreement or any other Loan Document that is not paid in
full when due (whether at stated maturity, by acceleration, or otherwise) shall
bear interest at the Default Rate for the period from and including the due date
thereof to but excluding the date the same is paid in full. Interest payable at
the Default Rate shall be payable from time to time on demand.
Section 2.5 USE OF PROCEEDS. The proceeds of Revolving Credit Loans shall
be used by HealthCor for general corporate purposes, including support of
working capital, issuance of Letters of Credit for all Subsidiaries and to
refinance the outstanding revolving credit debt of HealthCor under the Existing
Loans.
Section 2.6 COMMITMENT FEE. HealthCor agrees to pay to the Agent for the
account of each Bank a nonrefundable commitment fee on the daily average unused
amount of such Bank's Revolving Credit Commitment for the period from and
including the date of this Agreement to and including the Revolving Credit
Termination Date, at the Applicable Commitment Fee Rate based on a 360 day year
and the actual number of days elapsed. For the purposes of calculating the
commitment fee hereunder, the Revolving Credit Commitment shall be deemed
utilized by the amount of all outstanding Revolving Credit Loans and Letter of
Credit Liabilities. Accrued commitment fee shall be payable in arrears on each
Quarterly Payment Date and on the Revolving Credit Termination Date.
Section 2.7 REDUCTION OR TERMINATION OF REVOLVING CREDIT COMMITMENTS.
Subject to the terms of Section 5.4 regarding prepayments, HealthCor shall have
the right to terminate in whole or reduce in part the unused portion of the
Revolving Credit Commitments upon at least
AMENDED AND RESTATED CREDIT AGREEMENT - Page 19
three Business Days' prior notice (which notice shall be irrevocable) to the
Agent specifying the effective date thereof, whether a termination or reduction
is being made, and the amount of any partial reduction, PROVIDED, HOWEVER, the
aggregate Revolving Credit Commitments shall never be reduced below an amount
equal to the outstanding Letter of Credit Liabilities. Each partial reduction
shall be in the amount of $100,000 or an integral multiple thereof and HealthCor
shall simultaneously prepay the amount by which the unpaid principal amount of
the Revolving Credit Loans plus the outstanding Letter of Credit Liabilities
exceeds the Revolving Credit Commitments (after giving effect to such notice)
plus accrued and unpaid interest on the principal amount so prepaid. The
Revolving Credit Commitments may not be reinstated after they have been
terminated or reduced.
ARTICLE III
ACQUISITION LINE LOANS
Section 3.1 ACQUISITION LINE LOANS. Subject to the terms and conditions of
this Agreement, each Bank agrees to make one or more Acquisition Line Loans to
Holdings from time to time from the date hereof to and including the Acquisition
Line Termination Date, in an aggregate principal amount at any time outstanding
up to but not exceeding the lesser of (a) such Bank's pro rata part of the
Acquisition Line Available Amount or (b) the amount of such Bank's Acquisition
Line Commitment as then in effect, provided that the aggregate amount of all
Acquisition Line Loans at any time outstanding shall not exceed the aggregate
amount of the Acquisition Line Commitments. Holdings may Convert Loans of one
Type into Loans of another Type. Loans of each Type made by each Bank shall be
made and maintained at such Bank's Applicable Lending Office for Loans of such
Type.
Section 3.2 THE ACQUISITION LINE NOTES. The obligation of Holdings to
repay each Acquisition Line Loan and interest thereon shall be evidenced by an
Acquisition Line Note, each of which shall be executed by Holdings and payable
to the order of a Bank, in the principal amount of such Bank's pro rata portion
(based upon its Acquisition Line Commitment) of the aggregate amount of the
Acquisition Line Loans made by the Banks on such date and dated the date of such
Bank's Acquisition Line Loan or such later date as may be required with respect
to transactions contemplated by Section 15.7.
Section 3.3 REPAYMENT OF ACQUISITION LINE LOANS. Holdings shall repay the
unpaid principal balance of each Acquisition Line Note in quarterly principal
installments commencing on (a) with respect to each Acquisition Line Loan that
is made on or prior to the fifteenth (15th) day of the second month during any
calendar quarter, the first day of the second calendar quarter following the
quarter in which such Acquisition Line Loan was made, and (b) with respect to
each Acquisition Line Loan that is made on or after the sixteenth (16th) day of
the second month during any calendar quarter, the first day of the third
calendar quarter following the quarter in which such Acquisition Line Loan was
made, and continuing on the first day of each quarter thereafter, based upon a
five (5) year amortization schedule. Any remaining balance shall be due and
payable on the Acquisition Line Maturity Date.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 20
Section 3.4 INTEREST. The unpaid principal amount of the Acquisition Line
Loans shall bear interest at a varying rate per annum equal from day to day to
the lesser of (a) the Maximum Rate, or (b) the Applicable Rate. If at any time
the Applicable Rate for any Acquisition Line Loan shall exceed the Maximum Rate,
thereby causing the interest accruing on such Acquisition Line Loan to be
limited to the Maximum Rate, then any subsequent reduction in the Applicable
Rate for such Acquisition Line Loan shall not reduce the rate of interest on
such Acquisition Line Loan below the Maximum Rate until the aggregate amount of
interest accrued on such Acquisition Line Loan equals the aggregate amount of
interest which would have accrued on such Acquisition Line Loan if the
Applicable Rate had at all times been in effect. Accrued and unpaid interest on
the Acquisition Line Loans shall be due and payable as follows:
(i) in the case of Alternate Base Rate Loans, on each Quarterly
Payment Date;
(ii) in the case of each Eurodollar Loan, on the last day of the
Interest Period with respect thereto and, in the case of an Interest
Period with a duration greater than three months, on the last day of each
third month during such Interest Period;
(iii) upon the payment or prepayment of any Acquisition Line Loan or
the Conversion of any Loan to a Loan of another Type (but only on the
principal amount so paid, prepaid, or Converted); and
(iv) on the Acquisition Line Loan Maturity Date.
Notwithstanding the foregoing, any outstanding principal of any Acquisition Line
Loan and (to the fullest extent permitted by law) any other amount payable by
the Borrowers under this Agreement or any other Loan Document that is not paid
in full when due (whether at stated maturity, by acceleration, or otherwise)
shall bear interest at the Default Rate for the period from and including the
due date thereof to but excluding the date the same is paid in full. Interest
payable at the Default Rate shall be payable from time to time on demand.
Section 3.5 PREPAYMENTS FROM EXCESS CASH FLOW. If at any time during any
fiscal year of Holdings, commencing with the fiscal year ending December 31,
1997, the aggregate outstanding principal balance under the Acquisition Line
shall exceed $40,000,000, fifty percent (50%) of any Excess Cash Flow for such
fiscal year shall be applied toward prepayment of the remaining installments of
the Acquisition Line Loans in the inverse order of maturity. Such application of
prepayments shall be made first to Alternate Base Rate Loans and second to
Eurodollar Loans. Each such prepayment shall be made on or before the date that
is seven (7) Business Days after the earlier of (a) the date on which the
financial statements referred to in subsection 10.1(a) are required to be
delivered to the Agent and the Banks and (b) the date on which such financial
statements are actually delivered.
Section 3.6 [INTENTIONALLY OMITTED].
Section 3.7 USE OF PROCEEDS. The proceeds of the Acquisition Line Loans
shall be used by Holdings to (i) refinance the term debt outstanding under the
Existing Credit Agreement, (ii)
AMENDED AND RESTATED CREDIT AGREEMENT - Page 21
refinance outstanding Revolving Credit Loans which have been outstanding for
less than six (6) months, the proceeds of which were used to fund acquisitions,
and (iii) finance future acquisitions subject to the terms and conditions
hereof.
Section 3.8 COMMITMENT FEE. Holdings agrees to pay to the Agent for the
account of each Bank a nonrefundable commitment fee on the daily average unused
amount of such Bank's Acquisition Line Commitment for the period from and
including the date of this Agreement to and including the Acquisition Line
Termination Date, at the Applicable Commitment Fee Rate based on a 360 day year
and the actual number of days elapsed. The accrued commitment fee shall be
payable in arrears on each Quarterly Payment Date until and including the
Acquisition Line Termination Date.
Section 3.9 REDUCTION OR TERMINATION OF ACQUISITION LINE COMMITMENTS.
Subject to the terms of Section 5.4 regarding prepayments, Holdings shall have
the right to terminate in whole or reduce in part the unused portion of the
Acquisition Line Commitments upon at least three (3) Business Days prior notice
(which notice shall be irrevocable) to the Agent specifying the effective date
thereof, whether a termination or reduction is being made, and the amount of any
partial reduction. Each partial reduction shall be in the amount of $1,000,000
or an integral multiple thereof. The Acquisition Line Commitments may not be
reinstated after they have been terminated or reduced.
ARTICLE IV
LETTERS OF CREDIT
Section 4.1 LETTERS OF CREDIT. Subject to the terms and conditions of this
Agreement, the Issuing Banks agree to issue one or more Letters of Credit for
the account of HealthCor from time to time from the date hereof to and including
the Revolving Credit Termination Date; PROVIDED, however, that the outstanding
Letter of Credit Liabilities shall not at any time exceed the lesser of (1)
$2,000,000, or (2) an amount equal to the aggregate amount of the Revolving
Credit Commitments minus the sum of the outstanding Revolving Credit Loans. Each
Letter of Credit shall have an expiration date prior to the Revolving Credit
Termination Date, shall be payable in Dollars must be satisfactory in form and
substance to the applicable Issuing Bank, and shall be issued pursuant to such
documents and instruments (including, without limitation, such Issuing Bank's
standard application for issuance of letters of credit as then in effect [each
an "L/C APPLICATION"]) as such Issuing Bank may require (collectively, the "L/C
DOCUMENTS"). No Letter of Credit shall require any payment by the Issuing Bank
to the beneficiary thereunder pursuant to a drawing prior to the third Business
Day following presentment of a draft and any related documents to the Issuing
Bank.
Section 4.2 PARTICIPATION BY BANKS. By the issuance of any Letter of
Credit (which shall include any letters of credit issued for the account of
HealthCor under the Existing Credit Agreement that are outstanding on the
Closing Date) and without any further action on the part of the applicable
Issuing Bank or any of the Banks in respect thereof, each Issuing Bank hereby
grants to each Bank and each Bank hereby agrees to acquire from each Issuing
Bank a
AMENDED AND RESTATED CREDIT AGREEMENT - Page 22
participation in each such Letter of Credit and the related Letter of Credit
Liabilities, effective upon the issuance thereof without recourse or warranty,
except as to the amount of any draws made on any Letter of Credit, equal to such
Bank's pro rata part (based on the Revolving Credit Commitments) of such Letter
of Credit and Letter of Credit Liabilities. Each Issuing Bank shall provide a
copy of each Letter of Credit to each other Bank promptly after issuance. This
agreement to grant and acquire participations is an agreement between each
Issuing Bank and the Banks, and neither HealthCor nor any beneficiary of a
Letter of Credit shall be entitled to rely thereon. HealthCor agrees that each
Bank purchasing a participation from any Issuing Bank pursuant to this Section
4.2 may exercise all its rights to payment against HealthCor including the right
of setoff, with respect to such participation as fully as if such Bank were the
direct creditor of HealthCor in the amount of such participation.
Section 4.3 PROCEDURE FOR ISSUING LETTERS OF CREDIT. Each Letter of Credit
shall be issued on at least three Business Days prior notice from the Borrower
to the applicable Issuing Bank (with a copy to the Agent) by means of a Letter
of Credit Request Form describing the transaction proposed to be supported
thereby and specifying the information required therein. Such Issuing Bank shall
notify each Bank of the contents of each such notice on the day such notice is
received by such Issuing Bank if received by 11:00 a.m. Houston, Texas time on a
Business Day and otherwise on the next succeeding Business Day. Upon fulfillment
of the applicable conditions precedent contained in Article VIII, such Issuing
Bank shall make the applicable Letter of Credit available to HealthCor or, if so
requested by HealthCor, to the beneficiary of the Letter of Credit.
Section 4.4 REIMBURSEMENTS; PAYMENTS CONSTITUTE REVOLVING CREDIT LOANS.
Each payment by an Issuing Bank pursuant to a drawing under a Letter of Credit
shall constitute and be deemed an Alternate Base Rate Loan by each Bank to
HealthCor under such Bank's Revolving Credit Note and this Agreement as of the
day and time such payment is made by such Issuing Bank and in the amount of such
Bank's pro rata share of such payment; provided, however, if the applicable
conditions precedent contained in Section 8.2 are not satisfied on the date such
payment is made, HealthCor shall pay to the Agent for the account of the Issuing
Bank, prior to 11:00 a.m. Houston, Texas time on the Business Day immediately
following the date such payment is made by the Issuing Bank, the amount of such
payment, together with interest thereon at the Alternate Base Rate plus the
Applicable Margin from the date such payment is made by the Issuing Bank. If
HealthCor fails to reimburse the Issuing Bank for such drawing prior to 11:00
a.m. Houston, Texas time on the Business Day following the date such payment is
made by the Issuing Bank, such amount shall bear interest at the Default Rate
for the period from and including the due date thereof to but excluding the date
the same is paid in full. Promptly on the Business Day immediately following the
date each payment is made by an Issuing Bank pursuant to a drawing under a
Letter of Credit and after receipt of notice from the Issuing Bank of
HealthCor's failure to reimburse the Issuing Bank for such payment and the
amount of such payment, each Bank will make available to the Agent for the
account of the Issuing Bank at the Principal Office in immediately available
funds, such Bank's pro rata share of such payment.
Section 4.5 LETTER OF CREDIT FEE. HealthCor shall pay to the Agent for the
account of the Banks (to be shared ratably) a nonrefundable letter of credit fee
payable on the date each
AMENDED AND RESTATED CREDIT AGREEMENT - Page 23
Letter of Credit is issued, renewed or extended in an amount equal to the
greater of (i) a percentage per annum equal from day to day to the Applicable
Margin then in effect for Eurodollar Loans multiplied by the face amount of such
Letter of Credit, for the period during which such Letter of Credit will remain
outstanding, based on a 360 day year and the actual number of days elapsed, or
(ii) $500.00. Such letter of credit fee shall be payable upon the issuance of
each such Letter of Credit, as a condition to such issuance. A nonrefundable fee
in the amount of one-eighth of one percent (1/8%) per annum of the average daily
face amount of such Letter of Credit shall be payable by HealthCor to the
applicable Issuing Bank for its own account. In addition to the foregoing fees,
HealthCor shall pay or reimburse the applicable Issuing Bank for such normal and
customary costs and expenses as are incurred or charged by such Issuing Bank in
issuing, effecting payment under, amending or otherwise administering any Letter
of Credit.
Section 4.6 OBLIGATIONS ABSOLUTE. The obligations of the Borrowers under
this Agreement and the other Loan Documents (including without limitation the
obligation of HealthCor to reimburse the applicable Issuing Bank for draws under
any Letter of Credit) shall be absolute, unconditional, and irrevocable, and
shall be performed strictly in accordance with the terms of this Agreement and
the other Loan Documents under all circumstances whatsoever, including without
limitation the following circumstances:
(a) Any lack of validity or enforceability of any Letter of Credit
or any other Loan Document;
(b) The existence of any claim, set-off, counterclaim, defense or
other rights which HealthCor, any Obligated Party, or any other Person may
have at any time against any beneficiary of any Letter of Credit, the
Issuing Bank, or any other Person, whether in connection with this
Agreement or any other Loan Document or any unrelated transaction;
(c) Any statement, draft, or other document presented under any
Letter of Credit proving to be forged, fraudulent, invalid, or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect whatsoever;
(d) Payment by the Issuing Bank under any Letter of Credit against
presentation of a draft or other document which does not comply with the
terms of such Letter of Credit; or
(e) Any other circumstance or happening whatsoever, whether or not
similar to any of the foregoing.
Section 4.7 LIMITATION OF LIABILITY. HealthCor assumes all risks of the
acts or omissions of any beneficiary of any Letter of Credit with respect to its
use of such Letter of Credit. Neither the Issuing Bank, the Agent, the
Documentation Agent, any Bank nor any of their officers or directors shall have
any responsibility or liability to HealthCor or any other Person for: (a) the
failure of any draft to bear any reference or adequate reference to any Letter
AMENDED AND RESTATED CREDIT AGREEMENT - Page 24
of Credit, or the failure of any documents to accompany any draft at
negotiation, or the failure of any Person to surrender or to take up any Letter
of Credit or to send documents apart from drafts as required by the terms of any
Letter of Credit, or the failure of any Person to note the amount of any
instrument on any Letter of Credit, each of which requirements, if contained in
any Letter of Credit itself, it is agreed may be waived by the Issuing Bank, (b)
errors, omissions, interruptions, or delays in transmission or delivery of any
messages, (c) the validity, sufficiency, or genuineness of any draft or other
document, or any endorsement(s) thereon, even if any such draft, document or
endorsement should in fact prove to be in any and all respects invalid,
insufficient, fraudulent, or forged or any statement therein is untrue or
inaccurate in any respect, (d) the payment by the Issuing Bank to the
beneficiary of any Letter of Credit against presentation of any draft or other
document that does not comply with the terms of the Letter of Credit, or (e) any
other circumstance whatsoever in making or failing to make any payment under a
Letter of Credit. The Issuing Bank may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
Section 4.8 LETTER OF CREDIT DOCUMENTS. Certain additional provisions
regarding the obligations, liabilities, rights, remedies and agreements of
HealthCor and the Issuing Bank relative to the Letters of Credit shall be set
forth in the L/C Documents. To the extent the terms of this Agreement conflict
with any L/C Documents, this Agreement shall control.
ARTICLE V
BORROWING PROCEDURE; PAYMENTS
Section 5.1 BORROWING PROCEDURE. The Borrowers shall give the Agent notice
of each requested Loan by means of a Loan Request Form containing the
information therein required on the requested date of each Alternate Base Rate
Loan and at least three Business Days before the requested date of each
Eurodollar Loan. The Agent at its option may accept telephonic requests for
Loans, provided that such acceptance shall not constitute a waiver of the
Agent's right to delivery of a Loan Request Form in connection with subsequent
Loans. Any telephonic request for a Loan by any Borrower shall be promptly
confirmed by submission of a properly completed Loan Request Form to the Agent.
Each Revolving Credit Loan shall be in a minimum principal amount of $100,000 or
an integral multiple thereof. Each Acquisition Line Loan shall be in an
aggregate principal amount of $1,000,000 or an integral multiple thereof. The
aggregate principal amount of Eurodollar Loans having the same Interest Period
shall be at least equal to $1,000,000. The Agent shall promptly notify each Bank
of the contents of each such notice in writing. Not later than 12:00 Noon
Houston, Texas time on the date specified for each Loan hereunder, each Bank
will make available to the Agent at the Principal Office in immediately
available funds, for the account of the applicable Borrower, its pro rata share
of each Loan. After the Agent's receipt of such funds and subject to the other
terms and conditions of this Agreement, the Agent will make each Loan available
to the applicable Borrower by depositing the same, in immediately available
funds, in an account of such Borrower (designated by such Borrower) maintained
with the Agent at the Principal Office. All notices under this Section shall be
irrevocable and unless otherwise provided, shall be given not later than 11:00
A.M. Houston,
AMENDED AND RESTATED CREDIT AGREEMENT - Page 25
Texas, time on the day which is not less than the number of Business Days
specified above for such notice.
Section 5.2 CONVERSIONS AND CONTINUATIONS. The Borrowers shall have the
right from time to time to Convert all or part of a Loan of one Type into a Loan
of another Type or to Continue Eurodollar Loans as Eurodollar Loans by giving
the Agent written notice at least three Business Days before Conversion or
Continuation by means of a Notice of Conversion or Continuation containing the
information required therein; PROVIDED that (i) Eurodollar Loans may only be
Converted on the last day of the Interest Period, and (ii) except for
Conversions into Alternate Base Rate Loans, no Conversions shall be made while a
Default has occurred and is continuing. The Agent shall promptly notify each
Bank of the contents of each such notice in writing. All notices under this
Section shall be irrevocable and shall be given not later than 11:00 A.M.
Houston, Texas time on the day which is not less than the number of Business
Days specified above for such notice. If the applicable Borrower shall fail to
give the Agent the notice as specified above for Continuation or Conversion of a
Eurodollar Loan prior to the end of the Interest Period with respect thereto,
such Eurodollar Loan shall be Converted automatically into an Alternate Base
Rate Loan on the last day of the then current Interest Period for such
Eurodollar Loan.
Section 5.3 METHOD OF PAYMENT. All payments of principal, interest, and
other amounts to be made by the Borrowers under this Agreement and the other
Loan Documents shall be made to the Agent at the Principal Office for the
account of each Bank's Applicable Lending Office in Dollars and in immediately
available funds, without setoff, deduction, or counterclaim, not later than
11:00 A.M., Houston, Texas time on the date on which such payment shall become
due (each such payment made after such time on such due date to be deemed to
have been made on the next succeeding Business Day). Each Borrower shall, at the
time of making each such payment, specify to the Agent the sums payable by such
Borrower under this Agreement and the other Loan Documents to which such payment
is to be applied (and in the event that such Borrower fails to so specify, or if
an Event of Default has occurred and is continuing, the Agent may apply such
payment to the Obligations in such order and manner as it may elect in its sole
discretion, subject to Section 5.5 hereof). Each payment received by the Agent
under this Agreement or any other Loan Document for the account of a Bank shall
be paid promptly to such Bank, in immediately available funds, for the account
of such Bank's Applicable Lending Office. Whenever any payment under this
Agreement or any other Loan Document shall be stated to be due on a day that is
not a Business Day, such payment may be made on the next succeeding Business
Day, and such extension of time shall in such case be included in the
computation of the payment of interest and commitment fee, as the case may be.
Section 5.4 VOLUNTARY PREPAYMENT. The Borrowers may, with same day notice
in the case of Alternate Base Rate Loans and upon at least three Business Days'
prior notice to the Agent in the case of Eurodollar Loans, prepay the Loans in
whole at any time or from time to time in part without premium or penalty
(except as set forth in Section 6.5) but with accrued interest to the date of
prepayment on the amount so prepaid, provided that (a) Eurodollar Loans may be
prepaid only on the last day of the Interest Period for such Loans, and (b) each
partial prepayment shall be in the principal amount of $500,000 or an integral
multiple thereof.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 26
Otherwise, the applicable Borrower shall pay to the Agent on demand for the
account of the Banks, any loss or expense that the Banks incur because of such
prepayment. All notices under this Section shall be irrevocable and shall be
given not later than 11:00 A.M. Houston, Texas, time on the day which is not
less than the number of Business Days specified above for such notice.
Section 5.5 PRO RATA TREATMENT. Except to the extent otherwise provided
herein: (a) each Loan shall be made by the Banks under Section 2.1 and 3.1 or
deemed made by the Banks under Section 4.4, each payment of commitment fee under
Sections 2.6 and 3.8 and letter of credit fee under Section 4.5 shall be made
for the account of the Banks, and each termination or reduction of the Revolving
Credit Commitments under Section 2.7 or the Acquisition Line Commitments under
Section 3.9 shall be applied to the Revolving Credit Commitments or the
Acquisition Line Commitments of the Banks, as the case may be, pro rata
according to the respective unused Revolving Credit Commitments or Acquisition
Line Commitments and each Letter of Credit shall be deemed participated in by
the Banks, pro rata according to the amounts of their respective Revolving
Credit Commitments; (b) the making, Conversion, and Continuation of Loans of a
particular Type (other than Conversions provided for by Section 6.4) shall be
made pro rata among the Banks holding Loans of such Type according to the
amounts of their respective Commitments; (c) each payment and prepayment of
principal of or interest on Loans by the Borrowers of a particular Type shall be
made to the Agent for the account of the Banks holding Loans of such Type pro
rata in accordance with the respective unpaid principal amounts of such Loans
held by such Banks; and (d) Interest Periods for Loans of a particular Type
shall be allocated among the Banks holding Loans of such Type pro rata according
to the respective principal amounts held by such Banks.
Section 5.6 NON-RECEIPT OF FUNDS BY THE AGENT. Unless the Agent shall have
been notified by a Bank or a Borrower (the "PAYOR") prior to the date on which
such Bank is to make payment to the Agent of the proceeds of a Loan to be made
by it hereunder or such Borrower is to make a payment to the Agent for the
account of one or more of the Banks, as the case may be (such payment being
herein called the "REQUIRED PAYMENT"), which notice shall be effective upon
receipt, that the Payor does not intend to make the Required Payment to the
Agent, the Agent may assume that the Required Payment has been made and may, in
reliance upon such assumption (but shall not be required to), make the amount
thereof available to the intended recipient on such date and, if the Payor has
not in fact made the Required Payment to the Agent, the recipient of such
payment shall, on demand, pay to the Agent the amount made available to it
together with interest thereon in respect of the period commencing on the date
such amount was so made available by the Agent until the date the Agent recovers
such amount at a rate per annum equal to the Alternate Base Rate plus the
Applicable Margin (or, if the recipient of such payment is a Bank or an Issuing
Bank, the Federal Funds Rate) for such period.
Section 5.7 WITHHOLDING TAXES.
(a) Each of the Borrowers agrees to pay to each Bank that is not a
U.S. Person such additional amounts as are necessary in order that the net
payment of any amount due to such non-U.S. Person hereunder after
deduction for or withholding in respect of any
AMENDED AND RESTATED CREDIT AGREEMENT - Page 27
U.S. taxes imposed with respect to such payment (or in lieu thereof,
payment of such U.S. taxes by such non-U.S. Person), will not be less than
the amount stated herein to be then due and payable, PROVIDED that the
foregoing obligation to pay such additional amounts shall not apply:
(i) to any payment to any Bank hereunder unless such Bank is,
on the date hereof (or on the date it becomes a Bank hereunder as
provided in Section 15.8 hereof) and on the date of any change in
the Applicable Lending Office of such Bank, either entitled to
submit a Form 1001 (relating to such Bank and entitling it to a
complete exemption from withholding on all interest to be received
by it hereunder in respect of the Loans) or Form 4224 (relating to
all interest to be received by such Bank hereunder in respect of the
Loans),
(ii) to any U.S. taxes imposed solely by reason of the failure
of such non-U.S. Person (or, if such non-U.S. Person is not the
beneficial owner of the relevant Loan, such beneficial owner) to
comply with applicable certification, information, documentation or
other reporting requirements concerning the nationality, residence,
identity or connections with the United States of America of such
non-U.S. Person (or beneficial owner, as the case may be) if such
compliance is required by statute or regulation of the United States
of America as a precondition to relief or exemption from such U.S.
taxes.
For the purposes of this Section 5.7(a), (A) "FORM 1001" shall mean Form
1001 (Ownership, Exemption, or Reduced Rate Certificate) of the Department
of the Treasury of the United States of America, and (B) "FORM 4224" shall
mean Form 4224 (Exemption from Withholding of Tax on Income Effectively
Connected with the Conduct of a Trade Business in the United States) of
the Department of the Treasury of the United States of America (or in
relation to either such Form such successor and related forms as may from
time to time be adopted by the relevant taxing authorities of the United
States of America to document a claim to which such Form relates).
(b) Within 30 days after paying any amount to the Agent or any Bank
from which it is required by law to make any deduction or withholding, and
within 30 days after it is required by law to remit such deduction or
withholding to any relevant taxing or other authority, the Borrowers shall
deliver to the Agent for delivery to such non-U.S. Person evidence
satisfactory to such Person of such deduction, withholding or payment (as
the case may be).
Section 5.8 WITHHOLDING TAX EXEMPTION. Each Bank that is not incorporated
under the laws of the United States of America or a state thereof agrees that it
will deliver to the Borrowers and the Agent two duly completed copies of Form
1001 or 4224, certifying in either case that such Bank is entitled to receive
payments from the Borrowers under any Loan Document without deduction or
withholding of any United States federal income taxes. Each Bank which so
delivers a Form 1001 or 4224 further undertakes to deliver to the Borrowers and
the Agent two additional copies of such form (or a successor form) on or before
the date such form expires or
AMENDED AND RESTATED CREDIT AGREEMENT - Page 28
becomes obsolete or after the occurrence of any event requiring a change in the
most recent form so delivered by it, and such amendments thereto or extensions
or renewals thereof as may be reasonably requested by the Borrowers or the
Agent, in each case certifying that such Bank is entitled to receive payments
from the Borrowers under any Loan Document without deduction or withholding of
any United States federal income taxes, unless an event (including without
limitation any change in treaty, law or regulation) has occurred prior to the
date on which any such delivery would otherwise be required which renders all
such forms inapplicable or which would prevent such Bank from duly completing
and delivering any such form with respect to it and such Bank advises the
Borrowers and the Agent that it is not capable of receiving such payments
without any deduction or withholding of United States federal income tax.
Section 5.9 COMPUTATION OF INTEREST. Interest on the Loans and all other
amounts payable by either of the Borrowers hereunder shall be computed on the
basis of a year of 360 days and the actual number of days elapsed (including the
first day but excluding the last day) unless such calculation would result in a
usurious rate, in which case interest shall be calculated on the basis of a year
of 365 or 366 days, as the case may be.
ARTICLE VI
YIELD PROTECTION AND ILLEGALITY
Section 6.1 ADDITIONAL COSTS.
(a) Each of the Borrowers shall pay directly to each Bank from time
to time such amounts as such Bank may determine to be necessary to
compensate it for any costs incurred by such Bank which such Bank
determines are attributable to such Borrower and its making or maintaining
of any Eurodollar Loans hereunder or its obligation to make any of such
Loans hereunder, or any reduction in any amount receivable by such Bank
hereunder in respect of any such Loans or such obligation (such increases
in costs and reductions in amounts receivable being herein called
"ADDITIONAL COSTS"), resulting from any Regulatory Change which:
(i) changes the basis of taxation of any amounts payable to
such Bank under this Agreement or its Notes in respect of any of
such Loans (other than taxes imposed on the overall net income of
such Bank or its Applicable Lending Office for any Eurodollar Loans
by the jurisdiction in which such Bank has its principal office or
such Applicable Lending Office);
(ii) imposes or modifies any reserve, special deposit, minimum
capital, capital ratio, or similar requirement relating to any
extensions of credit or other assets of, or any deposits with or
other liabilities or commitments of, such Bank (including any
Eurodollar Loans or any deposits referred to in the definition of
"Eurodollar Rate" in Section 1.1 hereof); or
AMENDED AND RESTATED CREDIT AGREEMENT - Page 29
(iii) imposes any other condition affecting this Agreement or
the Notes or any of such extensions of credit or liabilities or
commitments.
Each Bank will notify the Borrowers of any event occurring after the date
of this Agreement which will entitle such Bank to compensation pursuant to
this Section 6.1(a) as promptly as practicable after it obtains knowledge
thereof and determines to request such compensation, and will designate a
different Applicable Lending Office for the Loans affected by such event
if such designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the sole opinion of such Bank, violate any
law, rule, or regulation or be in any way disadvantageous to such Bank,
provided that such Bank shall have no obligation to so designate an
Applicable Lending Office located outside the United States of America.
Each Bank will furnish the Borrowers with a certificate (which absent
manifest error, shall be conclusive) setting forth the basis and the
amount of each request of such Bank for compensation under this Section
6.1(a). If any Bank requests compensation from the Borrowers under this
Section 6.1(a), the Borrowers may, by notice to such Bank (with a copy to
the Agent) suspend the obligation of such Bank to make or Continue making,
or Convert Loans into, Loans of the Type with respect to which such
compensation is requested until the Regulatory Change giving rise to such
request ceases to be in effect (in which case the provisions of Section
6.4 hereof shall be applicable).
(b) Without limiting the effect of the foregoing provisions of this
Section 6.1, in the event that, by reason of any Regulatory Change that
becomes effective after date hereof, any Bank either (i) incurs Additional
Costs based on or measured by the excess above a specified level of the
amount of a category of deposits or other liabilities of such Bank which
includes deposits by reference to which the interest rate on Eurodollar
Loans is determined as provided in this Agreement or a category of
extensions of credit or other assets of such Bank which includes
Eurodollar Loans or (ii) becomes subject to restrictions on the amount of
such a category of liabilities or assets which it may hold, then, if such
Bank so elects by notice to the Borrowers (with a copy to the Agent), the
obligation of such Bank to make or Continue making, or Convert Loans into,
Eurodollar Loans hereunder shall be suspended until such Regulatory Change
ceases to be in effect (in which case the provisions of Section 6.4 hereof
shall be applicable).
(c) Determinations and allocations by any Bank for purposes of this
Section 6.1 of the effect of any Regulatory Change on its costs of
maintaining its obligations to make Eurodollar Loans or of making or
maintaining Eurodollar Loans or on amounts receivable by it in respect of
Eurodollar Loans, and of the additional amounts required to compensate
such Bank in respect of any Additional Costs, shall be conclusive,
provided that such determinations and allocations are made on a reasonable
basis.
Section 6.2 LIMITATION ON TYPES OF LOANS. Anything herein to the contrary
notwithstanding, if with respect to any Eurodollar Loans for any Interest Period
therefor:
AMENDED AND RESTATED CREDIT AGREEMENT - Page 30
(a) The Agent determines (which determination shall be conclusive)
that quotations of interest rates for the relevant deposits referred to in
the definition of "Eurodollar Rate" in Section 1.1 hereof are not being
provided in the relative amounts or for the relative maturities for
purposes of determining the rate of interest for Eurodollar Loans as
provided in this Agreement; or
(b) Required Banks determine (which determination shall be
conclusive) and notify the Agent that the relevant rates of interest
referred to in the definition of "Eurodollar Rate" in Section 1.1 hereof
on the basis of which the rate of interest for such Loans for such
Interest Period is to be determined do not accurately reflect the cost to
the Banks of making or maintaining Eurodollar Loans for such Interest
Period;
then the Agent shall give the Borrowers prompt notice thereof specifying the
relevant amounts or periods, and so long as such condition remains in effect,
the Banks shall be under no obligation to make additional Eurodollar Loans or to
Convert Alternate Base Rate Loans into Eurodollar Loans and the Borrowers shall,
on the last day(s) of the then current Interest Period(s) for the outstanding
Eurodollar Loans, either prepay such Eurodollar Loans or Convert such Eurodollar
Loans into Alternate Base Rate Loans in accordance with the terms of this
Agreement.
Section 6.3 ILLEGALITY. Notwithstanding any other provision of this
Agreement, in the event that it becomes unlawful for any Bank or its Applicable
Lending Office to (a) honor its obligation to make Eurodollar Loans hereunder or
(b) maintain Eurodollar Loans hereunder, then such Bank shall promptly notify
the Borrowers (with a copy to the Agent) thereof and such Bank's obligation to
make or maintain Eurodollar Loans and to Convert Alternate Base Rate Loans into
Eurodollar Loans hereunder shall be suspended until such time as such Bank may
again make and maintain Eurodollar Loans (in which case the provisions of
Section 6.4 hereof shall be applicable).
Section 6.4 TREATMENT OF EURODOLLAR LOANS. If the Eurodollar Loans of any
Bank are to be Converted pursuant to Section 6.1 or 6.3 hereof, such Bank's
Eurodollar Loans shall be automatically Converted into Alternate Base Rate Loans
on the last day(s) of the then current Interest Period(s) for the Eurodollar
Loans (or, in the case of a Conversion required by Section 6.1(b) or 6.3 hereof,
on such earlier date as such Bank may specify to the Borrowers with a copy to
the Agent) and, unless and until such Bank gives notice as provided below that
the circumstances specified in Section 6.1 or 6.3 hereof which gave rise to such
Conversion no longer exist:
(a) To the extent that such Bank's Eurodollar Loans have been so
Converted, all payments and prepayments of principal which would otherwise
be applied to such Bank's Eurodollar Loans shall be applied instead to its
Alternate Base Rate Loans;
(b) All Loans which would otherwise be made or Continued by such
Bank as Eurodollar Loans shall be made as or Converted into Alternate Base
Rate Loans and all Loans of such Bank which would otherwise be Converted
into Eurodollar Loans shall be Converted instead into (or shall remain as)
Alternate Base Rate Loans; and
AMENDED AND RESTATED CREDIT AGREEMENT - Page 31
If such Bank gives notice to the Borrowers (with a copy to the Agent) that the
circumstances specified in Section 6.1 or 6.3 hereof which gave rise to the
Conversion of such Bank's Eurodollar Loans pursuant to this Section 6.4 no
longer exist (which such Bank agrees to do promptly upon such circumstances
ceasing to exist) at a time when Eurodollar Loans are outstanding, such Bank's
Alternate Base Rate Loans shall be automatically Converted, on the first day(s)
of the next succeeding Interest Period(s) for such outstanding Eurodollar Loans
to the extent necessary so that, after giving effect thereto, all Loans held by
the Banks holding Eurodollar Loans and by such Bank are held pro rata (as to
principal amounts, Types, and Interest Periods) in accordance with their
respective Commitments.
Section 6.5 COMPENSATION. The Borrowers shall pay to the Agent for the
account of each Bank, upon the request of such Bank through the Agent, such
amount or amounts as shall be sufficient (in the reasonable opinion of such
Bank) to compensate it for any loss, cost, or expense incurred by it as a result
of:
(a) Any payment, prepayment or Conversion of a Eurodollar Loan for
any reason (including, without limitation, the acceleration of the
outstanding Loans pursuant to Section 13.2) on a date other than the last
day of an Interest Period for such Loan; or
(b) Any failure by the Borrower for any reason (including, without
limitation, the failure of any conditions precedent specified in Article
VIII to be satisfied) to borrow, Convert, or prepay a Eurodollar Loan on
the date for such borrowing, Conversion, or prepayment, specified in the
relevant notice of borrowing, prepayment, or Conversion under this
Agreement.
Section 6.6 CAPITAL ADEQUACY. If after the date hereof, any Bank shall
have determined that the adoption or implementation of any applicable law, rule,
or regulation regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any central bank or other
Governmental Authority charged with the interpretation or administration
thereof, or compliance by such Bank (or its parent) with any guideline, request,
or directive regarding capital adequacy (whether or not having the force of law)
of any central bank or other Governmental Authority, has or would have the
effect of reducing the rate of return on such Bank's (or its parent's) capital
as a consequence of its obligations hereunder or the transactions contemplated
hereby to a level below that which such Bank (or its parent) could have achieved
but for such adoption, implementation, change or compliance (taking into
consideration such Bank's policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within ten
(10) Business Days after demand by such Bank (with a copy to the Agent), the
Borrowers shall pay to such Bank such additional amount or amounts as will
compensate such Bank (or its parent) for such reduction; provided, however, the
Borrowers shall not be required to compensate any such Bank for any such
reduction for any period prior to the date upon which such Bank gives notice to
the Borrowers that an event or change resulting in a reduced rate of return on
the Bank's capital has occurred. A certificate of such Bank claiming
compensation under this Section and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive, provided that the
AMENDED AND RESTATED CREDIT AGREEMENT - Page 32
determination thereof is made on a reasonable basis. In determining such amount
or amounts, such Bank may use any reasonable averaging and attribution methods.
Section 6.7 ADDITIONAL COSTS IN RESPECT OF LETTERS OF CREDIT. If as a
result of any Regulatory Change there shall be imposed, modified, or deemed
applicable any tax, reserve, special deposit, or similar requirement against or
with respect to or measured by reference to Letters of Credit issued or to be
issued hereunder or the commitments to issue or participate in Letters of Credit
hereunder, and the result shall be to increase the cost to an Issuing Bank or
any Bank of issuing, maintaining or participating in any Letter of Credit or its
commitment to issue or participate in Letters of Credit hereunder or reduce any
amount receivable by an Issuing Bank or any Bank hereunder in respect of any
Letter of Credit (which increase in cost, or reduction in amount receivable,
shall be the result of the Issuing Bank's or such Bank's reasonable allocation
of the aggregate of such increases or reductions resulting from such event),
then, upon demand by such Issuing Bank or such Bank, the Borrowers agree to pay
such Issuing Bank or such Bank, from time to time as specified by such Issuing
Bank or such Bank, such additional amounts as shall be sufficient to compensate
such Issuing Bank or such Bank for such increased costs or reductions in amount.
A statement as to such increased costs or reductions in amount incurred by such
Issuing Bank or such Bank, submitted by such Issuing Bank or such Bank to the
Borrowers, shall be conclusive as to the amount thereof, provided that the
determination thereof is made on a reasonable basis.
ARTICLE VII
SECURITY
Section 7.1 COLLATERAL. To secure full and complete payment and
performance of the Obligations, the Borrowers shall execute and deliver or cause
to be executed and delivered the documents described below covering the property
and collateral described in this Section 7.1 (which, together with any other
property and collateral which may now or hereafter secure the Obligations or any
part thereof, is sometimes herein called the "COLLATERAL"):
(a) Each of the Companies shall grant to the Agent for the benefit
of the Agent, the Documentation Agent, the Banks and the Issuing Banks a
first priority security interest in all of its accounts, accounts
receivable, equipment, machinery, fixtures, inventory, chattel paper,
documents, instruments, and general intangibles, whether now owned or
hereafter acquired, and all products and proceeds thereof, pursuant to the
Security Agreements, provided that such security interest may be subject
in priority to certain Permitted Liens. The Agent may file and cause to be
filed such documents and instruments, including without limitation,
Uniform Commercial Code financing statements, as the Agent, in its sole
discretion, deems necessary or desirable to evidence and perfect its Liens
and security interests in the Collateral described in the Security
Agreements.
(b) The Borrowers shall cause each Person that becomes a Company
after the date hereof to grant to the Agent for the benefit of the Agent,
the Documentation Agent, the Banks and the Issuing Banks a first priority
security interest in all of its accounts,
AMENDED AND RESTATED CREDIT AGREEMENT - Page 33
accounts receivable, equipment, machinery, fixtures, inventory, chattel
paper, documents, instruments, and general intangibles, whether now owned
or hereafter acquired, and all products and proceeds thereof, pursuant to
a Security Agreement, provided that such security interest may be subject
in priority to certain Permitted Liens. The Agent may file and cause to be
filed such documents and instruments, including without limitation,
Uniform Commercial Code financing statements, as the Agent, in its sole
discretion, deems necessary or desirable to evidence and perfect its Liens
and security interests in the Collateral described in each such Security
Agreement.
(c) Holdings shall pledge and grant to the Agent for the benefit of
the Agent, the Documentation Agent, the Banks and the Issuing Banks a
continuing first priority security interest in one hundred percent (100%)
of the issued and outstanding capital stock of each of its Subsidiaries,
whether now existing or hereafter formed or acquired, and all products and
proceeds thereof, pursuant to the Pledge Agreement. The Agent shall retain
possession of the certificates evidencing the capital stock of the
Subsidiaries, together with stock powers duly executed in blank by
Holdings.
(d) A Life insurance policy issued on the life of S. βββββ ββββββ in
the amount of $2,000,000.00 and a life insurance policy issued on the life
of ββββββ β. ββββββ in the amount of $1,500,000 shall be collaterally
assigned to the Agent for the benefit of the Agent, the Documentation
Agent, the Issuing Banks and the Banks pursuant to assignments of life
insurance policy as collateral, each in form and substance satisfactory to
the Agent (the "ASSIGNMENTS OF LIFE INSURANCE").
(e) Each of the Companies shall execute and cause to be executed
such further documents and instruments, including without limitation,
Uniform Commercial Code financing statements, as the Agent, in its sole
discretion, deems necessary or desirable to evidence and perfect its liens
and security interests in the Collateral.
Section 7.2 LOCKBOX ACCOUNTS. Each Borrower shall (and shall cause each
other presently existing Company and each Company formed or acquired in the
future to) (a) establish and maintain one or more lockboxes and/or accounts (the
"LOCKBOX ACCOUNTS") with the Agent (the maintenance of which shall be subject to
such rules and regulations as the Agent shall from time to time specify), (b)
grant security interests to the Agent for the benefit of the Agent, the
Documentation Agent, the Issuing Banks and the Banks in each such Lockbox
Account and the related deposit accounts by executing one or more, as
appropriate, assignments in substantially the form of Exhibit "G" hereto, and
(c) promptly notify all of their respective accounts receivable obligors
hereafter to direct all payments on such accounts receivable directly into one
of the Lockbox Accounts. At any time while a Default does not exist and will not
occur as a result of any withdrawal, then (and at all other times to the extent
required by applicable law), the Companies may have full access to their
respective Lockbox Accounts and may withdraw from their respective Lockbox
Accounts in the amounts then remaining in excess of the minimum deposit required
to keep such account active. While a Default exists, the Agent may, without
prior notice or demand, take and apply against the Obligations for the pro rata
benefit of the Banks any and all funds then or thereafter on deposit in any one
or more Lockbox Accounts.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 34
Section 7.3 GUARANTIES. Each Borrower shall, and shall cause (a) the
presently existing Companies jointly and severally (without limit) to guarantee
full payment and performance of the Obligations, and (b) each Company formed or
acquired in the future to execute and deliver to the Agent on demand a guarantee
of the full payment and performance of the Obligations, pursuant to the
respective Guaranties.
Section 7.4 SETOFF. If an Event of Default shall have occurred and is
continuing, the Agent, Documentation Agent, Issuing Banks and each Bank are
hereby authorized at any time and from time to time, without notice to the
Borrowers (any such notice being hereby expressly waived by the Borrowers), to
set off and apply any and all deposits (general, time or demand, provisional or
final) at any time held and other indebtedness at any time owing by the Agent,
Documentation Agent, Issuing Banks or such Bank to or for the credit or the
account of the Borrowers against any and all of the obligations of the Borrowers
now or hereafter existing under this Agreement, the Notes, or any other Loan
Document, irrespective of whether or not the Agent, Documentation Agent, the
Issuing Banks or such Bank shall have made any demand under this Agreement, the
Notes or any other Loan Document and although such obligations may be unmatured.
As further security for the Obligations, each Borrower hereby grants to the
Agent for the benefit of the Agent, Documentation Agent, the Banks and the
Issuing Banks a security interest in all money, instruments and other property
of each such Borrower now or hereafter held by the Agent. In addition to the
right of setoff and as further security for the Obligations, each Borrower
hereby grants to the Agent for the benefit of the Agent, Documentation Agent,
the Banks and the Issuing Banks a security interest in all deposits (general or
special, time or demand, provisional or final) and other accounts of such
Borrower now or hereafter on deposit with or held by the Agent and all other
sums at any time credited or owing from the Agent, the Documentation Agent, the
Banks or the Issuing Banks to the Borrowers. The rights and remedies of the
Agent, the Documentation Agent, Issuing Banks and each Bank hereunder are in
addition to other rights and remedies (including, without limitation, other
rights of setoff) which the Agent, the Documentation Agent, the Issuing Banks
and the Banks may have.
ARTICLE VIII
CONDITIONS PRECEDENT
Section 8.1 INITIAL LOANS. The obligation of each Bank to make its initial
Loan or of any Issuing Bank to issue the initial Letter of Credit is subject to
the condition precedent that the Agent shall have received on or before the day
of such Loan or issuance all of the following, each dated (unless otherwise
indicated) the date hereof, in form and substance satisfactory to the Agent:
(a) RESOLUTIONS. Resolutions of the Board of Directors of each of
the Companies certified by a Secretary or an Assistant Secretary of such
Company which authorize the execution, delivery, and performance by such
Company of the Loan Documents to which such Company is or is to be a
party;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 35
(b) INCUMBENCY CERTIFICATE. A certificate of incumbency of each of
the Companies certified as of the Closing Date by the Secretary or an
Assistant Secretary of such Company certifying the names of the officers
of such Company authorized to sign this Agreement and each of the other
Loan Documents to which such Company is or is to be a party (including the
certificates contemplated herein) together with specimen signatures of
such officers;
(c) ARTICLES OR CERTIFICATE OF INCORPORATION. The articles or
certificate of incorporation, as applicable, of each of the Companies
certified by the Secretary of State of such Company's jurisdiction of
incorporation as of a current date acceptable to the Agent;
(d) BYLAWS. The bylaws of each of the Companies certified as of the
Closing Date by the Secretary or an Assistant Secretary of each such
Company;
(e) GOVERNMENTAL CERTIFICATES. Certificates of the appropriate
government officials of the state of incorporation of each of the
Companies as to the existence and good standing of such Company, each
dated a current date acceptable to the Agent;
(f) REVOLVING CREDIT NOTES. The Revolving Credit Notes executed by
HealthCor;
(g) ACQUISITION LINE NOTES. Acquisition Line Notes executed by
Holdings evidencing any Acquisition Line Loans made or to be made on the
Closing Date;
(h) SECURITY AGREEMENTS. The Security Agreements executed by the
respective Companies;
(i) GUARANTIES. The Guaranties executed by each Borrower and each
Guarantor;
(j) PLEDGE AGREEMENT. The Pledge Agreement executed by Holdings,
HOME Holdings, HOME and Pharmacy;
(k) STOCK CERTIFICATES. The original stock certificates evidencing
the stock pledged pursuant to the Pledge Agreement, together with stock
powers duly executed in blank;
(l) FINANCING STATEMENTS. Uniform Commercial Code financing
statements executed by the Companies and covering such Collateral as the
Agent may request;
(m) ASSIGNMENTS OF DEPOSIT ACCOUNTS. Assignments of deposit
accounts, executed by the appropriate parties in accordance with Section
7.2;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 36
(n) ASSIGNMENTS OF LIFE INSURANCE POLICIES. The Assignments of Life
Insurance, executed by the appropriate parties, in accordance with Section
7.1(d);
(o) CONTRIBUTION AND INDEMNIFICATION AGREEMENT. The Contribution and
Indemnification Agreement (herein so called) in substantially the form of
Exhibit "H" hereto, executed by the Companies;
(p) PREFERRED STOCK. All of the issued and outstanding Preferred
Stock shall have been converted into common stock of HealthCor upon terms
satisfactory to the Agent and the Required Banks and the obligation of
HealthCor to pay any accrued dividends on the Preferred Stock shall have
been extinguished;
(q) CORPORATE STRUCTURE. The corporate structure of Holdings and its
Subsidiaries shall be satisfactory to the Agent and the Required Banks;
(r) MATERIAL ADVERSE CHANGE. No material adverse change shall have
occurred since the date of the most recent consolidated financial
statements delivered by Holdings to the Agent, in the financial condition,
business, operations, or prospects of the Borrowers or in their assets,
liabilities and properties and there shall be no material threatened or
pending litigation adversely affecting their property;
(s) INSURANCE POLICIES. Copies of all insurance policies required by
Section 10.5, together with insurance certificates evidencing such
policies and showing the Agent as an additional insured and loss payee;
(t) UCC SEARCHES. The results of Uniform Commercial Code searches
showing all financing statements and other documents or instruments on
file against the Companies in such jurisdictions as the Agent shall
determine;
(u) LIEN RELEASES. Executed UCC-3 Termination Statements or
Assignments and other Lien releases that release or assign to the Agent
all Liens held by holders of Funded Debt not constituting Permitted Debt
and all other Liens that do not constitute Permitted Liens;
(v) OPINION OF COUNSEL. A favorable opinion of legal counsel to the
Companies, as to the matters set forth in Exhibit "I" hereto, and such
other matters as the Agent may reasonably request;
(w) FEES. Evidence that the fees referred to in the Fee Letters
shall have been paid in full;
(x) ATTORNEYS' FEES AND EXPENSES. Evidence that the costs, fees and
expenses (including attorneys' fees) referred to in the Fee Letters and in
Section 15.1, to the extent incurred, shall have been paid in full by the
Borrowers.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 37
Section 8.2 ALL LOANS. The obligation of each Bank to make any Loan or of
any Issuing Bank to issue any Letter of Credit (including the initial Loan or
issuance) is subject to the following additional conditions precedent:
(a) REQUEST FOR LOAN OR LETTER OF CREDIT. The Agent or the Issuing
Bank shall have received, in accordance with Section 5.1 or 4.3, as the
case may be, a Loan Request Form or Letter of Credit Request Form, dated
the date of such Loan or Letter of Credit, executed by an authorized
officer of the applicable Borrower;
(b) NO DEFAULT. No Default shall have occurred and be continuing, or
would result from such Loan or Letter of Credit, as the case may be;
(c) REPRESENTATIONS AND WARRANTIES. All of the representations and
warranties contained in Article IX hereof and in the other Loan Documents
shall be true and correct on and as of the date of such Loan with the same
force and effect as if such representations and warranties had been made
on and as of such date; and
(d) ADDITIONAL DOCUMENTATION. The Agent shall have received such
additional approvals, opinions, or documents as the Agent or its legal
counsel, ββββββββ ββββββββ & ββββββ P.C., may reasonably request.
Section 8.3 ACQUISITION LINE LOANS. The obligation of each Bank to make
any Acquisition Line Loan is subject to the additional condition precedent that
Holdings shall have delivered to the Agent at least ten Business Days (except in
the case of the initial Acquisition Line Loans in which case Holdings shall have
delivered the certificate referred to below on or before November 15, 1996)
prior to the date of the requested Loan, a certificate of the Chief Financial
Officer of Holdings in form and substance satisfactory to the Agent and the
Required Banks certifying and demonstrating compliance with each of the
financial covenants contained in Article XII hereof after giving effect to the
proposed acquisition(s) to be financed with the proceeds of the requested
Acquisition Line Loan.
ARTICLE IX
REPRESENTATIONS AND WARRANTIES
To induce the Agent, the Documentation Agent, the Issuing Banks and the
Banks to enter into this Agreement, each Borrower represents and warrants to the
Agent, the Documentation Agent, the Issuing Bank and the Banks that:
Section 9.1 CORPORATE EXISTENCE. Each Company (a) is a corporation duly
organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation; (b) has all requisite corporate power and
authority to own its assets and carry on its business as now being or as
proposed to be conducted; and (c) is qualified to do business in all
jurisdictions in which the nature of its business makes such qualification
necessary and where failure to so qualify would have a material adverse effect
on its business, condition (financial or otherwise),
AMENDED AND RESTATED CREDIT AGREEMENT - Page 38
operations, prospects, or properties. Such Borrower has the corporate power and
authority to execute, deliver, and perform its obligations under this Agreement
and the other Loan Documents to which it is or may become a party. Each
Guarantor has the corporate power and authority to execute, deliver, and perform
its obligations under its Guaranty and the other Loan Documents to which it is
or may become a party.
Section 9.2 FINANCIAL STATEMENTS. Holdings has delivered to the Agent
audited consolidated financial statements of the Companies as at and for the
fiscal year ended December 31, 1995, and unaudited consolidated and
consolidating financial statements of the Companies for the six (6)-month period
ended June 30, 1996. Such financial statements are true and correct, have been
prepared in accordance with GAAP (subject to year end adjustments and
disclosures in the case of unaudited interim financial statements), and fairly
and accurately present, on a consolidated and consolidating basis, the financial
condition of the Companies as of the respective dates indicated therein and the
results of operations for the respective periods indicated therein. None of the
Companies has any material obligations or liabilities (direct, indirect,
contingent or liquidated), liabilities for taxes, unusual forward or long-term
commitments, or unrealized or anticipated losses from any unfavorable
commitments except as scheduled or referred to or reflected in such financial
statements. There has been no material adverse change in the business, condition
(financial or otherwise), operations, prospects, or properties of any of the
Companies since the effective date of the most recent financial statements
referred to in this Section.
Section 9.3 CORPORATE ACTION; NO BREACH. The execution, delivery, and
performance by each Company of this Agreement and the other Loan Documents to
which such Company is or may become a party and compliance with the terms and
provisions hereof and thereof have been duly authorized by all requisite
corporate action on the part of such Company and do not and will not (a) violate
or conflict with, or result in a breach of, or require any consent under (i) the
articles of incorporation or bylaws of such Company, (ii) any applicable law,
rule, or regulation or any order, writ, injunction, or decree of any
Governmental Authority or arbitrator, which violation or conflict could have a
material adverse effect on the business, condition (financial or otherwise),
operations, prospects, or properties of any Company, the Collateral taken as a
whole, or the ability of the Companies to pay and perform the Obligations, or
(iii) any material agreement or instrument to which such Company is a party or
by which any of them or any of their property is bound or subject, or (b)
constitute a default under any such material agreement or instrument, or result
in the creation or imposition of any Lien (except as provided in Article VII)
upon any of the revenues or assets of such Company.
Section 9.4 OPERATION OF BUSINESS. Each Company possesses all licenses,
permits, franchises, patents, copyrights, trademarks, and tradenames, or rights
thereto, necessary to conduct its business substantially as now conducted and as
presently proposed to be conducted, and no Company is in violation of any valid
rights of others with respect to any of the foregoing, which violation would
have a material adverse effect on the business, condition (financial or
otherwise), operations, prospects, or properties of any Company, the Collateral
taken as a whole, or the abilities of the Companies to pay and perform the
Obligations. Without in any way limiting the foregoing, (a) each Borrower is
(and each Company is, except to the extent that it
AMENDED AND RESTATED CREDIT AGREEMENT - Page 39
would not have a material adverse effect on the business, condition [financial
or otherwise], operations, prospects, or properties of such Company) an
accredited, licensed, registered, or certified, as the case may be, healthcare
provider with the appropriate Healthcare Regulators where the nature and extent
of its business require, and (b) each Company has obtained and possesses all
requisite licenses and permits from and has registered with all of the
appropriate Governmental Authorities as necessary for such Company to distribute
or dispense drugs or controlled substances, to the extent such Company does so,
including without limitation, the Drug Enforcement Agency of the United States
Department of Justice and the Texas Department of Public Safety.
Section 9.5 LITIGATION AND JUDGMENTS. Except as disclosed on Schedule 2
hereto, there is no action, suit, investigation, or proceeding before or by any
Governmental Authority or arbitrator pending, or to the knowledge of such
Borrower, threatened against or affecting any Company, that would, if adversely
determined, have a material adverse effect on the business, condition (financial
or otherwise), operations, prospects, or properties of any Company or the
ability of the Companies to pay and perform the Obligations. There are no
outstanding judgments against any Company.
Section 9.6 RIGHTS IN PROPERTIES; LIENS. Each Company has good and
indefeasible title to or valid leasehold interests in its properties and assets,
real and personal, including the properties, assets, and leasehold interests
reflected in the financial statements described in Section 9.2, and none of the
properties, assets, or leasehold interests of any Company is subject to any
Lien, except the Permitted Liens.
Section 9.7 ENFORCEABILITY. This Agreement constitutes, and the other Loan
Documents, when delivered, shall constitute the legal, valid, and binding
obligations of the respective Companies that are party thereto, enforceable
against the respective Companies in accordance with their respective terms,
except as limited by bankruptcy, insolvency, or other laws of general
application relating to the enforcement of creditors' rights.
Section 9.8 APPROVALS. No authorization, approval, or consent of, and no
filing or registration with, any Governmental Authority or third party is or
will be necessary for the execution, delivery, or performance by the Companies
of the respective Loan Documents to which they are or may become a party or for
the validity or enforceability thereof.
Section 9.9 DEBT. The Companies have no Funded Debt, except as disclosed
on Schedule 3 hereto.
Section 9.10 TAXES. Each Company has filed all tax returns (federal,
state, and local) required to be filed, including all income, franchise,
employment, property, and sales tax returns, and has paid all of its liabilities
for taxes, assessments, governmental charges, and other levies that are due and
payable, except (i) any such taxes, assessments, levies, or other charges the
amount or validity of which are currently being contested in good faith by
appropriate proceedings and with respect to which adequate reserves in
accordance with GAAP have been established on the books of such Company, and
(ii) where failure to pay state taxes does not and
AMENDED AND RESTATED CREDIT AGREEMENT - Page 40
will not have a material adverse effect on the business, condition (financial or
otherwise), operations, prospects or properties of any Company, the Collateral
taken as a whole, or the ability of the Companies to pay and perform the
Obligations. Such Borrower knows of no pending investigation of any Company by
any taxing authority or of any pending but unassessed tax liability of any
Company.
Section 9.11 USE OF PROCEEDS; MARGIN SECURITIES. None of the Companies is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulations G, T, U, or X of the Board of Governors of the
Federal Reserve System), and no part of the proceeds of any Loan will be used to
purchase or carry any margin stock or to extend credit to others for the purpose
of purchasing or carrying margin stock.
Section 9.12 ERISA. Each Company is in compliance in all material respects
with all applicable provisions of ERISA. Neither a Reportable Event nor a
Prohibited Transaction has occurred and is continuing with respect to any Plan.
No notice of intent to terminate a Plan has been filed, nor has any Plan been
terminated. No circumstances exist which constitute grounds entitling the PBGC
to institute proceedings to terminate, or appoint a trustee to administer, a
Plan, nor has the PBGC instituted any such proceedings. No Company or ERISA
Affiliate has completely or partially withdrawn from a Multiemployer Plan. Each
Company and each ERISA Affiliate have met their minimum funding requirements
under ERISA with respect to all of their Plans, and the present value of all
vested benefits under each Plan do not exceed the fair market value of all Plan
assets allocable to such benefits, as determined on the most recent valuation
date of the Plan and in accordance with ERISA. No Company or ERISA Affiliate has
incurred any liability to the PBGC under ERISA.
Section 9.13 DISCLOSURE. No statement, information, report,
representation, or warranty made by any Company in this Agreement or in any
other Loan Document or furnished to the Agent, the Documentation Agent, any
Issuing Bank or any Bank in connection with this Agreement or any transaction
contemplated hereby contains any untrue statement of a material fact or omits to
state any material fact necessary to make the statements herein or therein not
misleading. There is no fact known to such Borrower which has a material adverse
effect, or which could reasonably be expected to have a material adverse effect,
on the business, condition (financial or otherwise), operations, prospects, or
properties of any Company that has not been disclosed in writing to the Agent,
the Documentation Agent, the Issuing Banks and the Banks.
Section 9.14 SUBSIDIARIES. Such Borrower has no Subsidiaries other than
those listed on Schedule 1 hereto, and Schedule 1 sets forth the jurisdiction of
incorporation of each Subsidiary and the percentage of such Borrower's ownership
of the outstanding voting stock of each Subsidiary. All of the outstanding
capital stock of each Subsidiary has been validly issued, is fully paid, and is
nonassessable.
Section 9.15 AGREEMENTS. No Company is a party to any indenture, loan, or
credit agreement, or to any lease or other agreement or instrument, or subject
to any charter or corporate restriction the compliance with which is reasonably
likely to have a material adverse
AMENDED AND RESTATED CREDIT AGREEMENT - Page 41
effect on the business, condition (financial or otherwise), operations,
prospects, or properties of such Company, or the ability of such Company to pay
and perform its obligations under the Loan Documents to which it is a party. No
Company is in default in any respect in the performance, observance, or
fulfillment of any of the obligations, covenants, or conditions contained in any
agreement or instrument material to its business to which it is a party which
could reasonably be expected to have a material adverse effect on the business,
condition (financial or otherwise), operations, prospects, or properties of such
Company.
Section 9.16 COMPLIANCE WITH LAWS; ENVIRONMENTAL LIABILITIES. No Company
is in violation in any material respect of any law, rule, regulation, order, or
decree of any Governmental Authority or arbitrator, including without limitation
any Environmental Laws. No Company is aware of, nor has any Company received
notice of, any conditions or circumstances associated with the currently or
previously owned or leased properties or operations of any Company that has
given or could reasonably be expected to give rise to any Environmental
Liabilities of any Company, and no Lien arising under any Environmental Law has
attached to any property or revenues of any Company.
Section 9.17 FRAUD AND ABUSE. None of the Companies, and to such
Borrower's knowledge, none of the officers, directors, agents, and employees of
any of the respective Companies, have engaged in any activities that are
prohibited under 42 U.S.C. ss.1320a-7b, known as the anti-kickback statute, or
the regulations promulgated thereunder, or related or similar state or local
statutes or regulations (including, but not limited to, Texas Health & Safety
Code ss. 161.091), including but not limited to the following: (a) knowingly and
willfully making or causing to be made a false statement or representation of a
material fact in any application for any benefit or payment; (b) knowingly and
willfully making or causing to be made any false statement or representation of
a material fact for use in determining rights to any benefit or payment; (c)
failing to disclose knowledge by a claimant of the occurrence of any event
affecting the initial or continued right to any benefit or payment on its own
behalf or on behalf of another; (d) knowingly and willfully soliciting or
receiving any remuneration (including any kickback, bribe, or rebate), directly
or indirectly, overtly or covertly, in cash or in kind or knowingly and
willfully offering or paying such remuneration as an inducement (a) in return
for referring an individual to a Person for the furnishing or arranging for the
furnishing of any item or service for which payment may be made in whole or in
part by Medicare, Medicaid, or other government program or (b) in return for
purchasing, leasing, or ordering or arranging for or recommending purchasing,
leasing, or ordering any good, facility, service, or item for which payment may
be made in whole or in part by Medicare, Medicaid, or other government program.
The investments in Sections 11.3 and 11.5 hereto conform to a safe harbor
promulgated under 42 U.S.C.
ss.1320a-7b.
Section 9.18 SELF REFERRAL. None of the Companies, and to such Borrower's
knowledge none of the officers, directors, agents, and employees of any of the
respective Companies, have engaged in any activities that are prohibited under
42 U.S.C. ss.1395nn, known as the self-referral or βββββ statute, or the
regulations promulgated thereunder, or related or similar state or local
statutes or regulations. The Companies' respective businesses currently are
conducted in a manner that will not violate 42 U.S.C. ss.1395nn as amended and
to be effective January 1, 1995.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 42
The ownership interests described in Sections 11.3 and 11.5 hereto in entities
to which such Borrower or its employees make referrals do not constitute a
violation of 42 U.S.C. ss.1395nn.
ARTICLE X
POSITIVE COVENANTS
Each Borrower covenants and agrees that, as long as the Obligations or any
part thereof are outstanding or any Bank has any Commitment hereunder or any
Issuing Bank has any obligation to issue Letters of Credit hereunder, such
Borrower will perform and observe the following positive covenants:
Section 10.1 REPORTING REQUIREMENTS. The Borrowers will furnish to the
Agent, the Documentation Agent, the Issuing Banks and each Bank:
(a) ANNUAL FINANCIAL STATEMENTS. As soon as available, and in any
event within ninety (90) days after the end of each fiscal year of the
Borrower, beginning with the fiscal year ending December 31, 1996, a copy
of the annual audit report of the Companies for such fiscal year
containing, on a consolidated and consolidating basis, balance sheets and
statements of income, retained earnings, and cash flow as at the end of
such fiscal year and for the 12-month period then ended, in each case
setting forth in comparative form the figures for the preceding fiscal
year, all in reasonable detail and audited and certified by and
accompanied by the unqualified opinion of, independent certified public
accountants of recognized standing acceptable to the Agent, to the effect
that such report has been prepared in accordance with GAAP and presents
fairly the financial conditions and results of operations of the
Companies;
(b) MONTHLY FINANCIAL STATEMENTS. As soon as available, and in any
event within forty-five (45) days after the end of each calendar month, a
copy of an unaudited financial report of the Companies as of the end of
such month and for the portion of the fiscal year then ended, containing,
on a consolidated and consolidating basis, balance sheets and statements
of income, retained earnings, and cash flow, in each case setting forth in
comparative form the figures for the corresponding period of the preceding
fiscal year, all in reasonable detail and prepared in accordance with GAAP
to fairly and accurately present (subject to year-end audit adjustments
and disclosures) the financial condition and results of operations of the
Companies, on a consolidated and consolidating basis, at the date and for
the periods indicated therein;
(c) COMPLIANCE CERTIFICATE. Concurrently with the delivery of each
of the financial statements referred to in subsection 10.1(a), and within
forty-five (45) days after the end of each fiscal quarter, a compliance
certificate of the chief financial officer or chief executive officer of
the Companies in substantially the form of Exhibit "K" hereto;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 43
(d) ACCOUNTS RECEIVABLE REPORT. Concurrently with the delivery of
each of the financial statements referred to in subsection 10.1(b), an
accounts receivable report in form and detail satisfactory to the Agent
and the Required Banks;
(e) ACQUISITION AGREEMENTS. Promptly, and in any event within three
(3) days after the execution thereof, copies of each letter of intent or
purchase contract or agreement executed by any Company for the purchase of
any ownership interest in any Person or substantially all of the assets of
any Person;
(f) REGULATORY NONCOMPLIANCE. Promptly, notice of any investigation
or claim in respect of any Company's status as a provider by or before any
Health Care Regulator that is not resolved in favor of such Company in the
exit interview or that results in notification to any Company that it is
out of compliance and that could reasonably be expected to have a material
adverse effect on the business, condition (financial or otherwise),
operations, prospects, or properties of such Company;
(g) NOTICE OF LITIGATION. Promptly after the commencement thereof,
notice of all actions, suits, and proceedings before any Governmental
Authority or arbitrator affecting any Company seeking $100,000 or more in
damages or which, if determined adversely to such Company, could have a
material adverse effect on the business, condition (financial or
otherwise), operations, prospects, or properties of such Company;
(h) NOTICE OF DEFAULT. As soon as possible and in any event within
five (5) days after the occurrence of each Default, a written notice
setting forth the details of such Default and the action that the
Borrowers have taken and propose to take with respect thereto;
(i) NOTICE OF MATERIAL ADVERSE CHANGE. As soon as possible and in
any event within five (5) days after the occurrence thereof, written
notice of any matter that is reasonably likely to have a material adverse
effect on the business, condition (financial or otherwise), operations,
prospects, or properties of any Company;
(j) GENERAL INFORMATION. Promptly, such other information concerning
the Companies as the Agent, the Documentation Agent, or any Bank may from
time to time reasonably request.
Section 10.2 MAINTENANCE OF EXISTENCE; CONDUCT OF BUSINESS. Such Borrower
will preserve and maintain, and will cause each Company to preserve and
maintain, its corporate existence and all of its leases, privileges, licenses,
permits, franchises, qualifications, and rights that are necessary or desirable
in the ordinary conduct of its business, except where the failure to do so does
not and will not have a material adverse effect on the business, condition
(financial or otherwise), operations, prospects, or properties of any Company,
the Collateral taken as a whole, or the ability of the Companies to pay and
perform the Obligations. Without in any way limiting the foregoing, the Borrower
will preserve and maintain, and will cause each Company to preserve and maintain
its status as an approved provider with all the Health Care Regulators
AMENDED AND RESTATED CREDIT AGREEMENT - Page 44
and other applicable Governmental Authorities where the failure to do so would
have a material adverse effect on its business, condition (financial or
otherwise), operations, prospects, or properties.
Section 10.3 MAINTENANCE OF PROPERTIES. Such Borrower will maintain, keep,
and preserve, and cause each Company to maintain, keep, and preserve, all of its
properties (tangible and intangible) necessary or useful in the proper conduct
of its business in good working order and condition.
Section 10.4 TAXES AND CLAIMS. Such Borrower will pay or discharge, and
will cause each Company to pay or discharge, at or before maturity or before
becoming delinquent (a) all taxes, levies, assessments, and governmental charges
imposed on it or its income or profits or any of its property, and (b) all
lawful claims for labor, material, and supplies, which, if unpaid, might become
a Lien upon any of its property; PROVIDED, however, that neither such Borrower
nor any Company shall be required to pay or discharge any tax, levy, assessment,
or governmental charge which is being contested in good faith by appropriate
proceedings diligently pursued, and for which adequate reserves have been
established; PROVIDED, FURTHER that with respect to taxes in an aggregate amount
in excess of $100,000, the conditions of Permitted Liens as described in Section
11.2 shall exist and notice shall have been given to the Agent and the Banks.
Section 10.5 INSURANCE. Such Borrower will maintain, and will cause each
of the Companies to maintain, insurance with financially sound and reputable
insurance companies in such amounts and covering such risks as is usually
carried by corporations engaged in similar businesses and owning similar
properties in the same general areas in which such Borrower and the Companies
operate, provided that in any event such Borrower will maintain and cause each
Company to maintain property and casualty insurance coverage for each Company of
at least $1,000,000 per incident and $2,000,000 maximum coverage and medical
malpractice liability coverage for each Company of at least $1,500,000 per
incident and $3,000,000 maximum coverage. Each insurance policy covering
Collateral or general liability shall, within ten (10) Business Days following
the Closing Date, name the Agent as loss payee or as an additional insured, as
applicable, and shall provide that such policy will not be cancelled or reduced
without thirty (30) days' prior written notice to the Agent. The Borrowers shall
at all times keep and maintain the insurance coverage on the lives of S. Wayne
and ββββββ β. ββββββ described in Section 7.1.
Section 10.6 INSPECTION RIGHTS. At any reasonable time and from time to
time, the Borrowers will permit, and will cause each Company to permit,
representatives of the Agent, the Issuing Bank and each Bank to examine, copy,
and make extracts from its books and records, to visit and inspect its
properties, and to discuss its business, operations, and financial condition
with its officers, employees, and independent certified public accountants.
Section 10.7 KEEPING BOOKS AND RECORDS. Such Borrower will maintain, and
will cause each Company to maintain, proper books of record and account in which
full, true, and correct
AMENDED AND RESTATED CREDIT AGREEMENT - Page 45
entries in conformity with GAAP (subject to year-end adjustments and
disclosures) shall be made of all dealings and transactions in relation to its
business and activities.
Section 10.8 COMPLIANCE WITH LAWS. Such Borrower will comply, and will
cause each Company to comply, in all material respects with all applicable laws,
rules, regulations, orders, and decrees of any Governmental Authority or
arbitrator.
Section 10.9 COMPLIANCE WITH AGREEMENTS. Such Borrower will comply, and
will cause each Company to comply, in all material respects with all agreements,
contracts, and instruments binding on it or affecting its properties or
business.
Section 10.10 FURTHER ASSURANCES. Such Borrower will, and will cause each
Company to, execute and deliver such further agreements and instruments and take
such further action as may be requested by the Agent to carry out the provisions
and purposes of this Agreement and the other Loan Documents and to create,
preserve, and perfect the Liens of the Agent for the benefit of the Agent, the
Documentation Agent, the Issuing Banks and the Banks in the Collateral.
Section 10.11 ERISA. Such Borrower will comply, and will cause each
Company to comply, with all minimum funding requirements, and all other material
requirements, of ERISA, if applicable, so as not to give rise to any liability
thereunder.
Section 10.12 SECURITY AGREEMENTS; GUARANTIES. Such Borrower shall cause
each Person that becomes a Company after the date hereof to execute and deliver
to the Agent a Security Agreement and a Guaranty within thirty (30) days after
the date such Person becomes a Company. Contemporaneously with the execution and
delivery of such Security Agreement and Guaranty, such Borrower shall cause all
outstanding capital stock of such Company to be pledged to the Agent pursuant to
a counterpart of the Pledge Agreement and deliver to the Agent such other
documents as the Agent may reasonably request.
ARTICLE XI
NEGATIVE COVENANTS
Each Borrower covenants and agrees that, as long as the Obligations or any
part thereof are outstanding or any Bank has any Commitment hereunder or any
Issuing Bank has any obligation to issue Letters of Credit hereunder, such
Borrower will perform and observe the following negative covenants:
Section 11.1 FUNDED DEBT. Such Borrower will not incur, create, assume, or
permit to exist, and will not permit any Company to incur, create, assume, or
permit to exist, any Funded Debt, except the following (herein referred to as
"PERMITTED DEBT"):
(a) Funded Debt to the Agent, the Documentation Agent, the Banks and
the Issuing Banks pursuant to the Loan Documents;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 46
(b) Funded Debt in an aggregate amount not to exceed $2,000,000 at
any time outstanding subordinated in payment to the Obligations in the
manner, to the extent and pursuant to documentation satisfactory to the
Agent and the Required Banks;
(c) Funded Debt of any Company to any other Company, so long as each
such Company shall have executed and delivered to the Agent a Security
Agreement, Uniform Commercial Code Financing Statements, assignment of
deposit accounts, and a Guaranty in accordance with Article VII, shall be
a party to the Contribution and Indemnification Agreement, and shall have
delivered to the Agent Uniform Commercial Code Lien searches and tax and
judgment Lien searches for all appropriate names and jurisdictions as the
Agent may require;
(d) Funded Debt of any Company under any seller note or any
guarantee of a seller note incurred in connection with any acquisition
permitted under this Agreement;
(e) Purchase money indebtedness of any Company representing the
purchase price of equipment, that is secured by the asset purchased;
provided that the principal amount of such indebtedness does not exceed
the purchase price of the equipment acquired and the Lien does not attach
to any other asset of any Company; capital leases so long as such leases
do not cover any property other than the property acquired in connection
therewith, together with renewals and extensions thereof; and
(f) Existing Funded Debt described on Schedule 3 hereto.
Section 11.2 LIMITATION ON LIENS. Such Borrower will not incur, create,
assume, or permit to exist, and will not permit any Company to incur, create,
assume, or permit to exist, any Lien upon any of its property, assets, or
revenues, whether now owned or hereafter acquired, except the following (herein
referred to as "PERMITTED LIENS"):
(a) Existing Liens on the property described on Schedule 4 hereto to
secure Permitted Debt;
(b) Liens in favor of the Agent for the benefit of the Agent, the
Documentation Agent, the Banks and the Issuing Banks to secure the
Obligations;
(c) Capital leases so long as such leases do not cover any property
other than the property acquired in connection therewith, together with
renewals and extensions thereof;
(d) Encumbrances consisting of minor easements, zoning restrictions,
or other restrictions on the use of real property that do not
(individually or in the aggregate) materially affect the value of the
assets encumbered thereby or materially impair the ability of such
Borrower or the Subsidiaries to use such assets in their respective
businesses, and none of which is violated in any material respect by
existing or proposed structures or land use;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 47
(e) The following to the extent no Lien has been filed in any
jurisdiction or agreed to: Liens for taxes, assessments, or other
governmental charges which are not yet due and payable;
(f) The following to the extent no Lien has been filed in any
jurisdiction or agreed to: Liens of mechanics, materialmen, warehousemen,
carriers, or other similar statutory Liens securing obligations that are
not yet due and are incurred in the ordinary course of business; and
landlord's Liens for rental not yet due and payable and which, to the
extent the same encumbers any of the Collateral, has been waived or
subordinated to the extent required by the Security Agreements;
(g) Liens resulting from good faith deposits to secure payments of
workmen's compensation or other social security programs or to secure the
performance of tenders, statutory obligations, surety and appeal bonds,
bids, contracts (other than for payment of Funded Debt), or leases made in
the ordinary course of business, not in excess of 10% of the aggregate
amount due thereunder;
(h) The following so long as the validity or amount thereof is being
contested in good faith and by appropriate and lawful proceedings
diligently conducted, reserve or other appropriate provision (if any)
required by GAAP shall have been made, levy and execution thereon have
been stayed and continue to be stayed, any thereof covering any Collateral
must be subordinate to all Liens in favor of the Agent, and they do not in
the aggregate materially detract from the value of the property of the
Person in question, or materially impair the use thereof in the operation
of its business: Claims and Liens for taxes due and payable; claims and
Liens upon, and defects of title to, real or personal property (other than
any of the Collateral), including any attachment of personal or real
property or other legal process prior to adjudication of a dispute on the
merits; claims and Liens of mechanics, materialmen, warehousemen,
carriers, landlords, or other like Liens; and adverse judgments on appeal;
(i) Liens on the capital stock of any Subsidiary acquired after the
date of this Agreement in a transaction permitted hereunder, securing all
or part of the purchase price thereof to the seller, so long as either (i)
the indebtedness secured thereby is subordinated to the Obligations in the
manner and to the extent satisfactory to the Agent and the Required Banks
and such Subsidiary shall have executed and delivered to the Agent a
Security Agreement, Uniform Commercial Code financing statements, and
assignment of deposit accounts, and a Guaranty in accordance with Article
VII and an addendum to the Contribution and Indemnification Agreement by
which such Subsidiary is made a party thereto, and shall have delivered to
the Agent Uniform Commercial Code Lien searches and tax and judgment Lien
searches for all appropriate names and jurisdictions as the Agent may
require, or (ii) the indebtedness secured thereby was incurred in
connection with an acquisition, no portion of the purchase price of which
was financed with funds advanced by the Banks pursuant to this Agreement;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 48
(j) Liens securing indebtedness for the purchase price of equipment;
provided that any such Lien shall attach only to the asset purchased; and
(k) Financing Statements filed in connection with operating lease
transactions described in Uniform Commercial Code search reports
previously furnished to the Agent.
Section 11.3 MERGERS, ETC. Such Borrower will not, and will not permit any
Company to, form any new Subsidiary, become a party to a merger or
consolidation, or purchase or otherwise acquire or commit to purchase or acquire
all or any part of the assets of any Person or any shares or other evidence of
beneficial ownership of any Person, or wind-up, dissolve, or liquidate;
PROVIDED, however, that each Company shall be permitted to (a) form a new
Subsidiary which shall have executed and delivered to the Agent a Security
Agreement, Uniform Commercial Code financing statements, an assignment of
deposit accounts, and a Guaranty in accordance with Article VII and an addendum
to the Contribution and Indemnification Agreement by which such Subsidiary is
made a party thereto, (b) subject to the provisions of subsection (c) of this
Section and Section 11.5, merge or consolidate with any Person if the surviving
Person shall have executed and delivered to the Agent a Security Agreement,
Uniform Commercial Code financing statements, an assignment of deposit accounts,
and a Guaranty in accordance with Article VII and an addendum to the
Contribution and Indemnification Agreement by which such Person is made a party
thereto and shall have delivered to the Agent Uniform Commercial Code Lien
searches and tax and judgment Lien searches for all appropriate names and
jurisdictions as the Agent may require, (c) purchase or acquire or commit to
purchase or acquire assets of or any shares or other evidence of beneficial
ownership of any Person to the extent permitted by Section 11.5, provided that
each Subsidiary so acquired shall have executed and delivered to the Agent a
Security Agreement, Uniform Commercial Code financing statements, an assignment
of deposit accounts, and a Guaranty in accordance with Article VII and an
addendum to the Contribution and Indemnification Agreement by which such
Subsidiary is made a party thereto and shall have delivered to the Agent Uniform
Commercial Code Lien searches and tax and judgment Lien searches for all
appropriate names and jurisdictions as the Agent may require.
Section 11.4 RESTRICTED PAYMENTS. Such Borrower will not declare or pay
any dividends or make any other payment or distribution (whether in cash,
property, or obligations) on account of its capital stock, or redeem, purchase,
retire, or otherwise acquire any of its capital stock, or permit any of the
Companies to purchase or otherwise acquire any capital stock of another Company,
or set apart any money for a sinking or other analogous fund for any dividend or
other distribution on its capital stock or for any redemption, purchase,
retirement, or other acquisition of any of its capital stock, except for any
loan, advance, extension of credit, capital contribution, or distribution (which
includes, with respect to the equity securities issued by any Company, the
retirement, redemption, or purchase of such shares or the declaration or payment
of any dividend by that Company) by any Company to any other Company so long as
each of the Companies shall have executed and delivered to the Agent a Security
Agreement, Uniform Commercial Code financing statements, an assignment of
deposit accounts, and a Guaranty in accordance with Article VII, shall be a
party to the Contribution and Indemnification Agreement and shall have delivered
to the Agent all Uniform Commercial Code, tax and judgment lien searches
required by the Agent.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 49
Section 11.5 LOANS AND INVESTMENTS. Such Borrower will not make, and will
not permit any Company to make, any advance, loan, extension of credit, or
capital contribution to or investment in, or purchase or own, or permit any
Company to purchase or own, any stock, bonds, notes, debentures, or other
securities of, any Person, except for the following:
(a) Investments in obligations of the United States of America and
agencies thereof and obligations guaranteed by the United States of
America maturing within one year from the date of acquisition;
(b) Certificates of deposit issued by commercial banks organized
under the laws of the United States of America or any state thereof and
having (i) combined capital, surplus, and undivided profits of not less
than $100,000,000 and (ii) a commercial paper rating from βββββ'β
Investors Service, Inc., or Standard & Poor's Corporation of at least P-1
and A-1, respectively;
(c) Eurodollar investments with financial institutions having (i)
combined capital, surplus, and undivided profits of not less than U.S.
$100,000,000, and (ii) a commercial paper rated at least P-1 or A-1 by
βββββ'β Investors Service, Inc., or Standard & Poor's Corporation,
respectively, or, if any institution does not have a commercial paper
rating, a comparable bond rating of at least A or BAA-1 by Standard &
Poor's Corporation or βββββ'β Investors Service, Inc., respectively;
(d) Extensions of credit in connection with trade receivables and
overpayments of trade payables and prepaid expenses, in each case
resulting from transactions in the ordinary course of business;
(e) Any loan, advance, extension of credit, capital contribution, or
distribution (which includes, with respect to the equity securities issued
by any Company, the retirement, redemption, or purchase of such shares or
the declaration or payment of any dividend by that Company) by any Company
to any other Company so long as each of the Companies shall have executed
and delivered to the Agent a Security Agreement, Uniform Commercial Code
financing statements, an assignment of deposit accounts, and a Guaranty in
accordance with Article VII, shall be a party to the Contribution and
Indemnification Agreement and shall have delivered to the Agent all
Uniform Commercial Code, tax and judgment lien searches required by the
Agent;
(f) Investments in the Companies listed on Schedule 2 and any
increase in the value of such investments;
(g) Acquisition of assets of any Person, so long as (a) the
provisions of Section 10.1(e) of the Agreement have been complied with,
(b) the total consideration cash and noncash - for each such acquisition
paid or to be paid by the Companies is not more than $5,000,000, (c) the
total consideration - cash and noncash - for such acquisition and all
other acquisitions of assets of or any shares or other beneficial
ownership of any Person (excluding acquisitions for which the Companies
have obtained the prior written
AMENDED AND RESTATED CREDIT AGREEMENT - Page 50
consent of the Required Banks but including any acquisitions made pursuant
to subsection 11.5(h)) during the six (6) month period then ended paid or
to be paid by the Companies is not more than $5,000,000 in the aggregate,
and (d) no Default is then continuing or would result from such
acquisition; and
(h) Acquisition of any new Subsidiary, so long as (a) such
Subsidiary has executed and delivered to the Agent a Security Agreement,
Uniform Commercial Code financing statements, an assignment of deposit
accounts, and a Guaranty in accordance with Article VII and an addendum to
the Contribution and Indemnification Agreement by which such Subsidiary is
made a party thereto, and has delivered to the Agent Uniform Commercial
Code lien searches and tax and judgment lien searches for all appropriate
names and jurisdictions as the Agent may require, (b) the provisions of
Section 10.1(e) of the Agreement have been complied with, (c) the total
consideration - cash and noncash - for each such acquisition paid or to be
paid by the Companies is not more than $5,000,000, (d) the total
consideration - cash and noncash - for such acquisition and all other
acquisitions of assets of or any shares or other beneficial ownership of
any Person (excluding acquisitions for which the Companies have obtained
the prior written consent of the Required Banks but including any
acquisitions made pursuant to subsection 11.5(g)) during the six (6) month
period then ended paid or to be paid by the Companies is not more than
$5,000,000, in the aggregate and (e) no Default is then continuing or
would result from such acquisition.
Section 11.6 LIMITATION ON ISSUANCE OF SUBSIDIARIES' CAPITAL STOCK. Such
Borrower will not, and will not permit any of the Companies to, at any time
issue, sell, assign, or otherwise dispose of (a) any of its capital stock, (b)
any securities exchangeable for or convertible into or carrying any rights to
acquire any of its capital stock, or (c) any option, warrant, or other right to
acquire any of its capital stock; PROVIDED, however, that the following shall be
permitted so long as no Default exists or would occur as a result thereof: (i)
options for the purchase of common stock issued to employees of the Companies,
(ii) Holdings may issue common stock, warrants for common stock, or debt
convertible into common stock to a seller in connection with an acquisition
permitted by Section 11.5, and (iii) the issuance and sale of stock to the
HealthCor Employee Stock Ownership Plan.
Section 11.7 TRANSACTIONS WITH AFFILIATES. Such Borrower will not enter
into, and will not permit any Company to enter into, any transaction, including,
without limitation, the purchase, sale, or exchange of property or the rendering
of any service, with any Affiliate of such Borrower or such Company, except in
the ordinary course of and pursuant to the reasonable requirements of such
Borrower's or such Subsidiary's business and upon fair and reasonable terms no
less favorable to such Borrower or such Subsidiary than would be obtained in a
comparable arm's-length transaction with a Person not an Affiliate of such
Borrower or such Subsidiary.
Section 11.8 DISPOSITION OF ASSETS. Such Borrower will not and will not
permit any Company to, sell, lease, assign, transfer, or otherwise dispose of
any of its assets, except dispositions of inventory in the ordinary course of
business.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 51
Section 11.9 SALE AND LEASEBACK. Such Borrower will not enter into, and
will not permit any Company to enter into, any arrangement with any Person
pursuant to which it leases from such Person real or personal property that has
been or is to be sold or transferred, directly or indirectly, by it to such
Person.
Section 11.10 PREPAYMENT OF FUNDED DEBT. Such Borrower will not prepay,
and will not permit any Company to prepay, any Funded Debt, except the
Obligations.
Section 11.11 NATURE OF BUSINESS. Such Borrower will not and will not
permit any Company to, engage in any business not reasonably related to the
businesses in which it is engaged on the date hereof.
Section 11.12 ENVIRONMENTAL PROTECTION. Such Borrower will not, and will
not permit any Company to, (a) use (or permit any tenant to use) any of its
respective properties or assets for the handling, processing, storage,
transportation, or disposal of any Hazardous Material, (b) generate any
Hazardous Material, (c) conduct any activity that is likely to cause a release
or threatened release of any Hazardous Material, or (d) otherwise conduct any
activity or use any of its respective properties or assets in any manner that is
likely to violate any Environmental Law or create any Environmental Liabilities
for which such Borrower or Company would be responsible.
Section 11.13 ACCOUNTING. Such Borrower will not, and will not permit any
Company to, change its fiscal year or make any change (a) in accounting
treatment or reporting practices, except as required by GAAP and disclosed to
the Agent, or (b) in tax reporting treatment, except as required by law and
disclosed to the Agent.
Section 11.14 COMPENSATION. Such Borrower will not pay, and will not
permit any Company to pay, to S. βββββ ββββββ or ββββββ β. ββββββ, or either of
them, any cash compensation (including salary, bonus and other cash
compensation) which would cause the aggregate combined cash compensation of S.
βββββ ββββββ and ββββββ β. ββββββ to be greater than $750,000 during any fiscal
year of the Borrowers.
ARTICLE XII
FINANCIAL COVENANTS
Each Borrower covenants and agrees that, as long as the Obligations or any
part thereof are outstanding or any Bank has any Commitment hereunder or any
Issuing Bank has any obligation to issue Letters of Credit hereunder, such
Borrower will perform and observe the following financial covenants:
Section 12.1 FUNDED DEBT TO EBITDAA RATIO. Such Borrower will not permit
the Funded Debt to EBITDAA Ratio calculated as of the last day of each fiscal
quarter of the Borrowers for the four fiscal quarters then ended to exceed 3.00
to 1.00.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 52
Section 12.2 CONSOLIDATED NET WORTH. Such Borrower will at all times
maintain or cause to be maintained Consolidated Net Worth in an amount not less
than the sum of (a) the Consolidated Net Worth as of the Closing Date, PLUS (b)
fifty percent (50%) of the consolidated net income of the Companies (to the
extent positive) for each fiscal year (which for the 1996 fiscal year shall be
limited to the net income of the Companies after the Closing Date), PLUS (c) one
hundred percent (100%) of the net proceeds received by the Companies from the
sale or issuance of equity securities.
Section 12.3 FIXED CHARGE COVERAGE RATIO. Such Borrower will not permit
the Fixed Charge Coverage Ratio calculated as of the last day of each fiscal
quarter of the Borrowers for the four fiscal quarters then ended to be less than
1.20 to 1.00.
Section 12.4 CAPITAL EXPENDITURES. Such Borrower will not permit the
aggregate capital expenditures of the Companies to exceed $10,000,000 during any
fiscal year; PROVIDED, HOWEVER, that for the purpose of determining the
aggregate capital expenditures of the Companies, to the extent that a Company
acquires the assets of or any shares or other beneficial ownership of any
Person, any portion of the purchase price that would otherwise be characterized
as capital expenditures shall not be included in the determination of capital
expenditures for the purposes of this Section 12.4.
Section 12.5 FUNDED DEBT TO CAPITALIZATION RATIO. Such Borrower will not
at any time permit the ratio of (a) Funded Debt of the Companies to (b) the sum
of Funded Debt of the Companies, PLUS Consolidated Net Worth to be greater than
fifty percent (50%).
ARTICLE XIII
DEFAULT
Section 13.1 EVENTS OF DEFAULT. Each of the following shall be deemed an
"Event of Default":
(a) Either Borrower shall fail to pay (i) any principal of the
Obligations when due, or (ii) any interest or other part of the
Obligations within five (5) days after the date due.
(b) Any representation or warranty made or deemed made by either
Borrower or any Obligated Party (or any of their respective officers) in
any Loan Document or in any certificate, report, notice, or financial
statement furnished at any time in connection with this Agreement shall be
false, misleading, or erroneous in any material respect when made or
deemed to have been made.
(c) Either Borrower or any Obligated Party shall fail to perform,
observe, or comply with any covenant, agreement, or term contained in
Article XI, or Article XII of this Agreement.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 53
(d) Either Borrower or any Obligated Party shall fail to perform,
observe, or comply with any other covenant, agreement, or term contained
in this Agreement or any other Loan Document (other than covenants to pay
the Obligations and the covenants contained in Articles XI and XII of this
Agreement) and such failure shall continue for a period of thirty (30)
days after notice thereof to such Borrower or such Borrower or Obligated
Party otherwise has notice thereof.
(e) Either Borrower, any Company, or any Obligated Party shall
commence a voluntary proceeding seeking liquidation, reorganization, or
other relief with respect to itself or its debts under any bankruptcy,
insolvency, or other similar law now or hereafter in effect or seeking the
appointment of a trustee, receiver, liquidator, custodian, or other
similar official of it or a substantial part of its property or shall
consent to any such relief or to the appointment of or taking possession
by any such official in an involuntary case or other proceeding commenced
against it or shall make a general assignment for the benefit of creditors
or shall generally fail to pay its debts as they become due or shall take
any corporate action to authorize any of the foregoing.
(f) An involuntary proceeding shall be commenced against either
Borrower, any Company, or any Obligated Party seeking liquidation,
reorganization, or other relief with respect to it or its debts under any
bankruptcy, insolvency, or other similar law now or hereafter in effect or
seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official for it or a substantial part of its property, and
such involuntary proceeding shall remain undismissed and unstayed for a
period of sixty (60) days.
(g) Either Borrower, any Company, or any Obligated Party shall fail
to discharge within a period of thirty (30) days after the commencement
thereof any attachment, sequestration, or similar proceeding or
proceedings involving an aggregate amount in excess of One Hundred
Thousand Dollars ($100,000) against any of its assets or properties.
(h) A final judgment or judgments for the payment of money in excess
of One Hundred Thousand Dollars ($100,000) in the aggregate shall be
rendered by a court or courts against either Borrower, any of the
Companies, or any Obligated Party and the same shall not be discharged (or
provision shall not be made for such discharge), or a stay of execution
thereof shall not be procured, within thirty (30) days from the date of
entry thereof and such Borrower or the relevant Company or Obligated Party
shall not, within said period of thirty (30) days, or such longer period
during which execution of the same shall have been stayed, appeal
therefrom and cause the execution thereof to be stayed during such appeal.
(i) Either Borrower, any Company, or any Obligated Party shall fail
to pay when due (after the lapse of any applicable grace periods) any
principal of or interest on any Funded Debt in excess of Five Hundred
Thousand Dollars ($500,000) (other than the Obligations), or the maturity
of any such Funded Debt shall have been accelerated, or any
AMENDED AND RESTATED CREDIT AGREEMENT - Page 54
such Funded Debt shall have been required to be prepaid prior to the
stated maturity thereof, or any event shall have occurred that permits
(or, with the giving of notice or lapse of time or both, would permit) any
holder or holders of such Funded Debt or any Person acting on behalf of
such holder or holders to accelerate the maturity thereof or require any
such prepayment.
(j) This Agreement or any other Loan Document shall cease to be in
full force and effect or shall be declared null and void or the validity
or enforceability thereof shall be contested or challenged by either
Borrower, any Company, any Obligated Party or any of their respective
shareholders, or either Borrower or any Obligated Party shall deny that it
has any further liability or obligation under any of the Loan Documents,
or any Lien or security interest created by the Loan Documents shall for
any reason cease to be a valid, first priority perfected security interest
in and Lien upon any of the Collateral purported to be covered thereby.
(k) Any of the following events shall occur or exist with respect to
any Company or any ERISA Affiliate: (i) any Prohibited Transaction
involving any Plan; (ii) any Reportable Event with respect to any Plan;
(iii) the filing under Section 4041 of ERISA of a notice of intent to
terminate any Plan or the termination of any Plan; (iv) any event or
circumstance that might constitute grounds entitling the PBGC to institute
proceedings under Section 4042 of ERISA for the termination of, or for the
appointment of a trustee to administer, any Plan, or the institution by
the PBGC of any such proceedings; or (v) complete or partial withdrawal
under Section 4201 or 4204 of ERISA from a Multiemployer Plan or the
reorganization, insolvency, or termination of any Multiemployer Plan; and
in each case above, such event or condition, together with all other
events or conditions, if any, have subjected or could in the reasonable
opinion of Required Banks subject any Company to any tax, penalty, or
other liability to a Plan, a Multiemployer Plan, the PBGC, or otherwise
(or any combination thereof) which in the aggregate exceed or could
reasonably be expected to exceed One Hundred Thousand Dollars ($100,000).
(l) S. βββββ ββββββ and ββββββ β. ββββββ, or either of them, shall
transfer, assign, encumber (voluntarily or involuntarily), sell, or convey
in any manner more than 10% of the equity securities of Holdings owned or
held by S. βββββ ββββββ and ββββββ β. ββββββ, or either of them.
(m) There shall occur a material change or changes in the management
of the Companies, or any of them. Without in any way limiting the
foregoing, a material change in management shall be deemed to have
occurred if S. βββββ ββββββ or ββββββ β. ββββββ ceases to be actively
involved in the management of the Companies.
(n) Any Company shall fail to be an accredited, licensed, registered
or certified health care provider, as the case may be, as represented and
warranted pursuant to Section 9.4.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 55
Section 13.2 REMEDIES. If any Event of Default shall occur and be
continuing, the Agent may (and if directed by Required Banks, shall) do any one
or more of the following:
(a) ACCELERATION. Declare all outstanding principal of and accrued
and unpaid interest on the Notes and all other obligations of the
Borrowers under the Loan Documents immediately due and payable, and the
same shall thereupon become immediately due and payable, without notice,
demand, presentment, notice of dishonor, notice of acceleration, notice of
intent to accelerate, protest, or other formalities of any kind, all of
which are hereby expressly waived by the Borrowers.
(b) TERMINATION OF COMMITMENTS. Terminate the Commitments and the
obligation of the Issuing Banks to issue Letters of Credit hereunder
without notice to the Borrowers.
(c) JUDGMENT. Reduce any claim to judgment.
(d) FORECLOSURE. Foreclose or otherwise enforce any Lien granted to
the Agent for the benefit of itself, the Documentation Agent, the Issuing
Banks and the Banks to secure payment and performance of the Obligations
in accordance with the terms of the Loan Documents.
(e) RIGHTS. Exercise any and all rights and remedies afforded by the
laws of the State of Texas or any other jurisdiction, by any of the Loan
Documents, by equity, or otherwise.
Provided, however, that upon the occurrence of an Event of Default under
Subsection (e) or (f) of Section 13.1, the Commitments of all of the Banks and
the obligation of the Issuing Banks to issue Letters of Credit shall
automatically terminate, and the outstanding principal of and accrued and unpaid
interest on the Notes and all other obligations of the Borrowers under the Loan
Documents shall thereupon become immediately due and payable without notice,
demand, presentment, notice of dishonor, notice of acceleration, notice of
intent to accelerate, protest, or other formalities of any kind, all of which
are hereby expressly waived by the Borrowers.
Section 13.3 LETTERS OF CREDIT. If any Event of Default shall occur and be
continuing, HealthCor shall, if requested by the Agent (either acting on its own
or at the request of the Required Banks), immediately deposit with and pledge to
the Agent cash or cash equivalent investments in an amount equal to the
outstanding Letter of Credit Liabilities as security for the Obligations.
Furthermore, in order to continue to secure the full and complete payment and
performance of the Obligations arising in connection with the Letter of Credit
Liabilities that continue to be outstanding after acceleration of the other
Obligations or the exercise of other rights after the occurrence of an Event of
Default, the Agent may do either or both of the following: (a) segregate such
Collateral or accounts and other property as the Agent may in its sole
discretion select, and (b) retain and deposit into one or more cash collateral
accounts any proceeds received by the Agent from the foreclosure of Collateral,
exercise of rights of offset or banker's lien, or exercise of other rights.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 56
Section 13.4 PERFORMANCE BY THE AGENT. If either Borrower shall fail to
perform any covenant or agreement in accordance with the terms of the Loan
Documents, the Agent may, at the direction of Required Banks, perform or attempt
to perform such covenant or agreement on behalf of such Borrower. In such event,
such Borrower shall, at the request of the Agent, promptly pay any amount
expended by the Agent or the Banks in connection with such performance or
attempted performance to the Agent at the Principal Office, together with
interest thereon at the Default Rate from and including the date of such
expenditure to but excluding the date such expenditure is paid in full.
Notwithstanding the foregoing, it is expressly agreed that neither the Agent,
the Documentation Agent, any Issuing Bank nor any Bank shall have any liability
or responsibility for the performance of any obligation of the Borrowers under
this Agreement or any of the other Loan Documents.
ARTICLE XIV
THE AGENT AND THE DOCUMENTATION AGENT
Section 14.1 APPOINTMENT, POWERS AND IMMUNITIES. In order to expedite the
various transactions contemplated by this agreement, the Banks and the Issuing
Banks hereby irrevocably appoint and authorize TCB to act as their Agent and
First Chicago to act as the Documentation Agent hereunder and under each of the
other Loan Documents. TCB and First Chicago each hereby consents to such
appointment and agrees to perform the duties of the Agent and the Documentation
Agent, as the case may be as specified herein. The Banks and the Issuing Banks
authorize and direct the Agent and the Documentation Agent to take such action
in their name and on their behalf under the terms and provisions of the Loan
Documents and to exercise such rights and powers thereunder as are specifically
delegated to or required of the Agent and the Documentation Agent for the Banks
and the Issuing Banks, together with such rights and powers as are reasonably
incidental thereto. The Agent is hereby expressly authorized to act as the Agent
on behalf of itself, the other Banks and the Issuing Banks:
(a) To receive on behalf of the Documentation Agent, each of the
Banks and the Issuing Banks any payment of principal, interest, fees or
other amounts paid pursuant to this Agreement and the Notes and to
distribute to the Documentation Agent, each Bank and/or Issuing Bank its
share of all payments so received as provided in this Agreement;
(b) To receive all documents and items to be furnished under the
Loan Documents;
(c) To act as nominee for and on behalf of the Documentation Agent,
the Banks and the Issuing Banks in and under the Loan Documents;
(d) To arrange for the means whereby the funds of the Banks are to
be made available to the Borrower;
AMENDED AND RESTATED CREDIT AGREEMENT - Page 57
(e) To distribute to the Documentation Agent, the Banks and the
Issuing Banks information, requests, notices, payments, prepayments,
documents and other items received from the Borrowers, the other Obligated
Parties, and other Persons;
(f) To execute and deliver to the Borrowers, the other Obligated
Parties, and other Persons, all requests, demands, approvals, notices, and
consents received from the Documentation Agent, the Banks and the Issuing
Banks;
(g) To the extent permitted by the Loan Documents, to exercise on
behalf of the Documentation Agent, each Bank and Issuing Bank all rights
and remedies of the Documentation Agent, the Banks and the Issuing Banks
upon the occurrence of any Event of Default;
(h) To accept, execute, and deliver the Security Agreements, the
Pledge Agreement and any other security documents as the secured party,
including, without limitation all UCC financing statements; and
(i) To take such other actions as may be contemplated by the Loan
Documents or requested by Required Banks or, if otherwise required by the
Loan Documents, all of the Banks. To take all such actions incidental
thereto.
Neither the Agent, the Documentation Agent nor any of their Affiliates,
officers, directors, employees, attorneys, or agents shall be liable for any
action taken or omitted to be taken by any of them hereunder or otherwise in
connection with this Agreement or any of the other Loan Documents except for its
or their own gross negligence or willful misconduct. Without limiting the
generality of the preceding sentence, each of the Agent and the Documentation
Agent (i) may treat the payee of any Note as the holder thereof until the Agent
receives written notice of the assignment or transfer thereof signed by such
payee and in form reasonably satisfactory to the Agent; (ii) shall have no
duties or responsibilities except those expressly set forth in this Agreement
and the other Loan Documents, and shall not by reason of this Agreement or any
other Loan Document be a trustee or fiduciary for any Bank or Issuing Bank;
(iii) shall not be required to initiate any litigation or collection proceedings
hereunder or under any other Loan Document except to the extent requested by
Required Banks; (iv) shall not be responsible to the Banks or the Issuing Banks
for any recitals, statements, representations or warranties contained in this
Agreement or any other Loan Document, or any certificate or other document
referred to or provided for in, or received by any of them under, this Agreement
or any other Loan Document, or for the value, validity, effectiveness,
enforceability, or sufficiency of this Agreement or any other Loan Document or
any other document referred to or provided for herein or therein or for any
failure by any Person to perform any of its obligations hereunder or thereunder;
(v) may consult with legal counsel (including counsel for the Borrowers),
independent public accountants, and other experts selected by it and shall not
be liable for any action taken or omitted to be taken in good faith by it in
accordance with the advice of such counsel, accountants, or experts; and (vi)
shall incur no liability under or in respect of any Loan Document by acting upon
any notice, consent, certificate, or other instrument or writing believed by it
to be genuine and signed or sent by the proper party or parties. As to any
matters not
AMENDED AND RESTATED CREDIT AGREEMENT - Page 58
expressly provided for by this Agreement, the Agent and the Documentation Agent
shall in all cases be fully protected in acting, or in refraining from acting,
hereunder in accordance with instructions signed by Required Banks (unless
otherwise required by this Agreement), and such instructions of Required Banks
and any action taken or failure to act pursuant thereto shall be binding on all
of the Banks; PROVIDED, however, that neither the Agent nor the Documentation
Agent shall be required to take any action which exposes the Agent or the
Documentation Agent to personal liability or which is contrary to this Agreement
or any other Loan Document or applicable law.
Section 14.2 RIGHTS OF AGENT AND DOCUMENTATION AGENT AS A BANK. With
respect to its Commitments, the Loans made by it and the Notes issued to it,
each of TCB and First Chicago in its capacity as a Bank hereunder shall have the
same rights and powers hereunder as any other Bank and may exercise the same as
though it were not acting as the Agent, the Documentation Agent or an Issuing
Bank, as the case may be, and the term "BANK" or "BANKS" shall, unless the
context otherwise indicates, include each of the Agent and Documentation Agent
in its individual capacity. The Agent, the Documentation Agent and their
respective Affiliates may (without having to account therefor to any Bank or
Issuing Bank) accept deposits from, lend money to, act as trustee under
indentures of, provide merchant banking services to, and generally engage in any
kind of business with the Borrowers, any of the Companies, any other Obligated
Party, and any other Person who may do business with or own securities of either
Borrower, any Company, or any other Obligated Party, all as if it were not
acting as the Agent or the Documentation Agent, as the case may be, and without
any duty to account therefor to the Banks or the Issuing Banks.
Section 14.3 SHARING OF PAYMENTS, ETC. If any Bank shall obtain any
payment of any principal of or interest on any Loan made by it under this
Agreement or payment of any other obligation under the Loan Documents then owed
by either Borrower or any other Obligated Party to such Bank, whether voluntary,
involuntary, through the exercise of any right of setoff, banker's lien,
counterclaim or similar right, or otherwise, in excess of its pro rata share,
such Bank shall promptly purchase from the other Banks participations in the
Loans held by them hereunder in such amounts, and make such other adjustments
from time to time as shall be necessary to cause such purchasing Bank to share
the excess payment ratably with each of the other Banks in accordance with its
pro rata portion thereof. To such end, all of the Banks shall make appropriate
adjustments among themselves (by the resale of participations sold or otherwise)
if all or any portion of such excess payment is thereafter rescinded or must
otherwise be restored. Each Borrower agrees, to the fullest extent it may
effectively do so under applicable law, that any Bank so purchasing a
participation in the Loans made by the other Banks may exercise all rights of
setoff, banker's lien, counterclaim, or similar rights with respect to such
participation as fully as if such Bank were a direct holder of Loans to such
Borrower in the amount of such participation. Nothing contained herein shall
require any Bank to exercise any such right or shall affect the right of any
Bank to exercise, and retain the benefits of exercising, any such right with
respect to any other indebtedness or obligation of such Borrower.
Section 14.4 INDEMNIFICATION. THE BANKS HEREBY AGREE TO
INDEMNIFY THE AGENT, THE DOCUMENTATION AGENT AND THE ISSUING
AMENDED AND RESTATED CREDIT AGREEMENT - Page 59
BANKS FROM AND HOLD THE AGENT, THE DOCUMENTATION AGENT AND THE ISSUING BANKS
HARMLESS AGAINST (TO THE EXTENT NOT REIMBURSED UNDER SECTIONS 15.1 AND 15.2, BUT
WITHOUT LIMITING THE OBLIGATIONS OF THE BORROWERS UNDER SECTIONS 15.1 AND 15.2),
RATABLY IN ACCORDANCE WITH THEIR RESPECTIVE COMMITMENTS, ANY AND ALL
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS,
DEFICIENCIES, SUITS, COSTS, EXPENSES (INCLUDING ATTORNEYS' FEES), AND
DISBURSEMENTS OF ANY KIND OR NATURE WHATSOEVER WHICH MAY BE IMPOSED ON, INCURRED
BY, OR ASSERTED AGAINST THE AGENT, THE DOCUMENTATION AGENT OR THE ISSUING BANKS
IN ANY WAY RELATING TO OR ARISING OUT OF ANY OF THE LOAN DOCUMENTS OR ANY ACTION
TAKEN OR OMITTED TO BE TAKEN BY THE AGENT, THE DOCUMENTATION AGENT OR AN ISSUING
BANK UNDER OR IN RESPECT OF ANY OF THE LOAN DOCUMENTS; PROVIDED, FURTHER, THAT
NO BANK SHALL BE LIABLE FOR ANY PORTION OF THE FOREGOING TO THE EXTENT CAUSED BY
THE AGENT'S, THE DOCUMENTATION AGENT'S OR SUCH ISSUING BANK'S GROSS NEGLIGENCE
OR WILLFUL MISCONDUCT. WITHOUT LIMITATION OF THE FOREGOING, IT IS THE EXPRESS
INTENTION OF THE BANKS THAT THE AGENT, THE DOCUMENTATION AGENT AND THE ISSUING
BANKS SHALL BE INDEMNIFIED HEREUNDER FROM AND HELD HARMLESS AGAINST ALL OF SUCH
LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES, PENALTIES, ACTIONS, JUDGMENTS,
DEFICIENCIES, SUITS, COSTS, EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES), AND
DISBURSEMENTS OF ANY KIND OR NATURE DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RESULTING FROM THE SOLE OR CONTRIBUTORY NEGLIGENCE OF THE AGENT, THE
DOCUMENTATION AGENT OR SUCH ISSUING BANK. WITHOUT LIMITING ANY OTHER PROVISION
OF THIS SECTION, EACH BANK AGREES TO REIMBURSE THE AGENT, THE DOCUMENTATION
AGENT AND THE ISSUING BANKS PROMPTLY UPON DEMAND FOR ITS PRO RATA SHARE
(CALCULATED ON THE BASIS OF THE COMMITMENTS) OF ANY AND ALL OUT-OF-POCKET
EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES) INCURRED BY THE AGENT, THE
DOCUMENTATION AGENT OR AN ISSUING BANK IN CONNECTION WITH THE PREPARATION,
EXECUTION, DELIVERY, ADMINISTRATION, MODIFICATION, AMENDMENT OR ENFORCEMENT
(WHETHER THROUGH NEGOTIATIONS, LEGAL PROCEEDINGS, OR OTHERWISE) OF, OR LEGAL
ADVICE IN RESPECT OF RIGHTS OR RESPONSIBILITIES UNDER, THE LOAN DOCUMENTS, TO
THE EXTENT THAT THE AGENT, THE DOCUMENTATION AGENT OR SUCH ISSUING BANK IS NOT
REIMBURSED FOR SUCH EXPENSES BY THE BORROWERS.
Section 14.5 INDEPENDENT CREDIT DECISIONS. Each Bank agrees that it has
independently and without reliance on the Agent, the Documentation Agent, any
Issuing Bank or any other Bank, and based on such documents and information as
it has deemed appropriate, made its own credit analysis of the Borrowers and
decision to enter into this Agreement and that it will, independently and
without reliance upon the Agent, the Documentation Agent, any Issuing Bank or
any other Bank, and based upon such documents and information as it shall deem
appropriate
AMENDED AND RESTATED CREDIT AGREEMENT - Page 60
at the time, continue to make its own analysis and decisions in taking or not
taking action under this Agreement or any of the other Loan Documents. Neither
the Agent nor the Documentation Agent shall be required to keep itself informed
as to the performance or observance by either Borrower or any Obligated Party of
this Agreement or any other Loan Document or to inspect the properties or books
of either Borrower or any Obligated Party. Except for notices, reports and other
documents and information expressly required to be furnished to the Banks by the
Agent or the Documentation Agent hereunder or under the other Loan Documents,
neither the Agent nor the Documentation Agent shall have any duty or
responsibility to provide the Issuing Banks or any Bank with any credit or other
financial information concerning the affairs, financial condition or business of
the Borrowers or any Obligated Party (or any of their Affiliates) which may come
into the possession of the Agent, the Documentation Agent or any of their
respective Affiliates.
Section 14.6 SEVERAL COMMITMENTS. The Commitments and other obligations of
the Banks under this Agreement are several. The default by any Bank in making a
Loan in accordance with its Commitment shall not relieve the other Banks of
their obligations under this Agreement. In the event of any default by any Bank
in making any Loan, each nondefaulting Bank shall be obligated to make its Loan
but shall not be obligated to advance the amount which the defaulting Bank was
required to advance hereunder. In no event shall any Bank be required to advance
an amount or amounts which shall in the aggregate exceed such Bank's Commitment.
No Bank shall be responsible for any act or omission of any other Bank.
Section 14.7 SUCCESSOR AGENT AND DOCUMENTATION AGENT. The Documentation
Agent may resign at any time by giving notice thereof to the Agent and the
Documentation Agent may be removed at any time with or without cause by Required
Banks. Subject to the appointment and acceptance of a successor Agent as
provided below, the Agent may resign at any time by giving notice thereof to the
Banks and the Borrowers and the Agent may be removed at any time with or without
cause by Required Banks. Upon any such resignation or removal of the Agent,
Required Banks will have the right to appoint a successor Agent. If no successor
Agent shall have been so appointed by Required Banks and shall have accepted
such appointment within 30 days after the retiring Agent's giving of notice of
resignation or the Required Banks' removal of the retiring Agent, then the
retiring Agent may, on behalf of the Banks, appoint a successor Agent, which
shall be a commercial bank organized under the laws of the United States of
America or any State thereof and having combined capital and surplus of at least
$100,000,000. Upon the acceptance of its appointment as successor Agent, such
successor Agent shall thereupon succeed to and become vested with all rights,
powers, privileges, immunities, and duties of the resigning or removed Agent,
and the resigning or removed Agent shall be discharged from its duties and
obligations under this Agreement and the other Loan Documents. After any Agent's
resignation or removal as Agent, the provisions of this Article XIV shall
continue in effect for its benefit in respect of any actions taken or omitted to
be taken by it while it was the Agent.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 61
ARTICLE XV
MISCELLANEOUS
Section 15.1 EXPENSES. Each Borrower hereby agrees to pay on demand: (a)
all reasonable costs and expenses of the Agent in connection with the
preparation, negotiation, execution, and delivery of this Agreement and the
other Loan Documents and any and all amendments, modifications, renewals,
extensions, and supplements thereof and thereto, including, without limitation,
the fees and expenses of legal counsel for the Agent, (b) all costs and expenses
of the Agent, the Documentation Agent, the Issuing Banks and the Banks in
connection with any Default and the enforcement of this Agreement or any other
Loan Document, including, without limitation, the fees and expenses of legal
counsel for the Agent, the Documentation Agent, the Issuing Banks and the Banks,
and (c) all other costs and expenses incurred by the Agent in connection with
this Agreement or any other Loan Document.
Section 15.2 INDEMNIFICATION. EACH BORROWER SHALL INDEMNIFY THE AGENT, THE
DOCUMENTATION AGENT, EACH ISSUING BANK AND EACH BANK AND EACH AFFILIATE THEREOF
AND THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, ATTORNEYS, AND AGENTS
(COLLECTIVELY, THE "INDEMNIFIED PARTIES") FROM, AND HOLD EACH OF THEM HARMLESS
AGAINST, ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES, JUDGMENTS,
DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS' FEES) TO WHICH ANY OF
THEM MAY BECOME SUBJECT WHICH DIRECTLY OR INDIRECTLY ARISE FROM OR RELATE TO (A)
THE NEGOTIATION, EXECUTION, DELIVERY, PERFORMANCE, ADMINISTRATION, OR
ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS, (B) ANY OF THE TRANSACTIONS
CONTEMPLATED BY THE LOAN DOCUMENTS, (C) ANY BREACH BY EITHER BORROWER OF ANY
REPRESENTATION, WARRANTY, COVENANT, OR OTHER AGREEMENT CONTAINED IN ANY OF THE
LOAN DOCUMENTS, (D) THE PRESENCE, RELEASE, THREATENED RELEASE, DISPOSAL,
REMOVAL, OR CLEANUP OF ANY HAZARDOUS MATERIAL LOCATED ON, ABOUT, WITHIN, OR
AFFECTING ANY OF THE PROPERTIES OR ASSETS OF EITHER BORROWER OR ANY COMPANY, OR
(E) ANY INVESTIGATION, LITIGATION, OR OTHER PROCEEDING, INCLUDING, WITHOUT
LIMITATION, ANY THREATENED INVESTIGATION, LITIGATION, OR OTHER PROCEEDING
RELATING TO ANY OF THE FOREGOING; PROVIDED, HOWEVER, NO INDEMNIFIED PARTY SHALL
HAVE THE RIGHT TO BE INDEMNIFIED FOR ITS OWN FRAUD, GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. WITHOUT LIMITING ANY PROVISION OF THIS AGREEMENT OR OF ANY OTHER
LOAN DOCUMENT, IT IS THE EXPRESS INTENTION OF THE PARTIES HERETO THAT EACH
PERSON TO BE INDEMNIFIED UNDER THIS SECTION SHALL BE INDEMNIFIED FROM AND HELD
HARMLESS AGAINST ANY AND ALL LOSSES, LIABILITIES, CLAIMS, DAMAGES, PENALTIES,
JUDGMENTS, DISBURSEMENTS, COSTS, AND EXPENSES (INCLUDING ATTORNEYS' FEES)
ARISING OUT OF OR RESULTING FROM THE SOLE OR CONTRIBUTORY NEGLIGENCE OF SUCH
PERSON.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 62
Section 15.3 LIMITATION OF LIABILITY. NONE OF THE AGENT, THE DOCUMENTATION
AGENT, ANY ISSUING BANK, ANY BANK, OR ANY AFFILIATE, OFFICER, DIRECTOR,
EMPLOYEE, ATTORNEY, OR AGENT THEREOF SHALL HAVE ANY LIABILITY WITH RESPECT TO,
AND EACH BORROWER HEREBY WAIVES, RELEASES, AND AGREES NOT TO βββ ANY OF THEM
UPON, ANY CLAIM FOR ANY SPECIAL OR PUNITIVE DAMAGES SUFFERED OR INCURRED BY
EITHER BORROWER IN CONNECTION WITH, ARISING OUT OF, OR IN ANY WAY RELATED TO,
THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, OR ANY OF THE TRANSACTIONS
CONTEMPLATED BY THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH BORROWER
HEREBY WAIVES, RELEASES, AND AGREES NOT TO βββ THE AGENT, THE DOCUMENTATION
AGENT, ANY ISSUING BANK, OR ANY BANK OR ANY OF THEIR RESPECTIVE AFFILIATES,
OFFICERS, DIRECTORS, EMPLOYEES, ATTORNEYS, OR AGENTS FOR PUNITIVE DAMAGES IN
RESPECT OF ANY CLAIM IN CONNECTION WITH, ARISING OUT OF, OR IN ANY WAY RELATED
TO, THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS, OR ANY OF THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS.
Section 15.4 NO DUTY. All attorneys, accountants, appraisers, and other
professional Persons and consultants retained by the Agent, the Documentation
Agent, the Issuing Banks and the Banks shall have the right to act exclusively
in the interest of the Agent, the Documentation Agent, the Issuing Banks and the
Banks and shall have no duty of disclosure, duty of loyalty, duty of care, or
other duty or obligation of any type or nature whatsoever to the Borrower or any
of the Borrower's shareholders or any other Person.
Section 15.5 NO FIDUCIARY RELATIONSHIP. The relationship between the
Borrowers and each Bank is solely that of debtor and creditor, and neither the
Agent, the Documentation Agent, any Issuing Bank nor any Bank has any fiduciary
or other special relationship with the Borrowers, and no term or condition of
any of the Loan Documents shall be construed so as to deem the relationship
between the Borrowers and any Bank to be other than that of debtor and creditor.
Section 15.6 NO WAIVER; CUMULATIVE REMEDIES. No failure on the part of the
Agent, the Documentation Agent, any Issuing Bank or any Bank to exercise and no
delay in exercising, and no course of dealing with respect to, any right, power,
or privilege under this Agreement shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, power, or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any
other right, power, or privilege. The rights and remedies provided for in this
Agreement and the other Loan Documents are cumulative and not exclusive of any
rights and remedies provided by law.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 63
Section 15.7 SUCCESSORS AND ASSIGNS.
(a) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns. The
Borrowers may not assign or transfer any of their rights or obligations
hereunder without the prior written consent of the Agent, the
Documentation Agent and all of the Banks. Any Bank may sell participations
to one or more banks or other institutions in or to all or a portion of
its rights and obligations under this Agreement and the other Loan
Documents (including, without limitation, all or a portion of its
Commitments and the Loans owing to it); PROVIDED, however, that (i) such
Bank's obligations under this Agreement and the other Loan Documents
(including, without limitation, its Commitments) shall remain unchanged,
(ii) such Bank shall remain solely responsible to the Borrower for the
performance of such obligations, (iii) such Bank shall remain the holder
of its Notes for all purposes of this Agreement, (iv) the Borrowers shall
continue to deal solely and directly with such Bank in connection with
such Bank's rights and obligations under this Agreement and the other Loan
Documents, and (v) such Bank shall not sell a participation that conveys
to the participant the right to vote or give or withhold consents under
this Agreement or any other Loan Document, other than the right to vote
upon or consent to (A) any increase of such Bank's Commitments, (B) any
reduction of the principal amount of, or interest to be paid on, the Loans
of such Bank, (C) any reduction of any commitment fee or other amount
payable to such Bank under any Loan Document, (D) any release of
Collateral or release of any Guarantor, or (E) any postponement of any
date for the payment of any amount payable in respect of the Loans of such
Bank.
(b) The Borrowers and each of the Banks agree that any Bank (the
"ASSIGNING BANK") may, with the Agent's consent and unless an Event of
Default has occurred, the Borrowers' consent (except that no consent shall
be required with respect to assignments by TCB and First Chicago during
the first six months after the date hereof, TCB and First Chicago agreeing
to use reasonable efforts to keep the Borrowers advised of any potential
assignees), which consent of the Borrowers shall not be unreasonably
withheld or delayed, at any time assign to one or more Eligible Assignees
all, or a proportionate part of all, of its rights and obligations under
this Agreement and the other Loan Documents (including, without
limitation, its Commitments and Loans) (each an "ASSIGNEE"); PROVIDED,
however, that (i) each such assignment shall be of a consistent, and not a
varying, percentage of all of the assigning Bank's Commitments, rights and
obligations under this Agreement and the other Loan Documents, (ii) except
in the case of an assignment of all of a Bank's rights and obligations
under this Agreement and the other Loan Documents, the amount of the
Commitments of the assigning Bank being assigned pursuant to each
assignment (determined as of the date of the Assignment and Acceptance
with respect to such assignment) shall in no event be less than
$5,000,000, and (iii) the parties to each such assignment shall execute
and deliver to the Agent for its acceptance and recording in the Register
(as defined below), an Assignment and Acceptance, together with the Notes
subject to such assignment, and, except in the case of an assignment to an
Affiliate of the Assigning Bank, a processing and recordation fee of
$2,500, to be paid by the Assignee. Upon such execution, delivery,
acceptance, and recording, from and
AMENDED AND RESTATED CREDIT AGREEMENT - Page 64
after the effective date specified in each Assignment and Acceptance,
which effective date shall be at least five Business Days after the
execution thereof, or, if so specified in such Assignment and Acceptance,
the date of acceptance thereof by the Agent, (x) the assignee thereunder
shall be a party hereto as a "Bank" and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment
and Acceptance, have the rights and obligations of a Bank hereunder and
under the Loan Documents and (y) the Bank that is an assignor thereunder
shall, to the extent that rights and obligations hereunder have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its
rights and be released from its obligations under this Agreement and the
other Loan Documents (and, in the case of an Assignment and Acceptance
covering all or the remaining portion of a Bank's rights and obligations
under the Loan Documents, such Bank shall cease to be a party thereto).
(c) By executing and delivering an Assignment and Acceptance, the
Bank that is an assignor thereunder and the assignee thereunder confirm to
and agree with each other and the other parties hereto as follows: (i)
other than as provided in such Assignment and Acceptance, such assigning
Bank makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties, or representations made in or
in connection with the Loan Documents or the execution, legality,
validity, and enforceability, genuineness, sufficiency, or value of the
Loan Documents or any other instrument or document furnished pursuant
thereto; (ii) such assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrowers or any Obligated Party or the performance or observance by
either Borrower or any Obligated Party of its obligations under the Loan
Documents; (iii) such assignee confirms that it has received a copy of the
other Loan Documents, together with copies of the financial statements
referred to in Section 9.2 and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Agent, the Documentation Agent
or such assignor and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan
Documents; (v) such assignee confirms that it is an Eligible Assignee;
(vi) such assignee appoints and authorizes the Agent and the Documentation
Agent to take such action as agent on its behalf and exercise such powers
under the Loan Documents as are delegated to the Agent and the
Documentation Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; and (vii) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of the Loan Documents are required to be performed by it as a Bank.
(d) The Agent shall maintain at its Principal Office a copy of each
Assignment and Acceptance delivered to and accepted by it and a register
for the recordation of the names and addresses of the Banks and the
Commitments of, and principal amount of the Loans owing to, each Bank from
time to time (the "REGISTER"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
AMENDED AND RESTATED CREDIT AGREEMENT - Page 65
Borrowers, the Agent, the Documentation Agent, the Issuing Banks and the
Banks may treat each Person whose name is recorded in the Register as a
Bank hereunder for all purposes under the Loan Documents. The Register
shall be available for inspection by either Borrower, any Issuing Bank or
any Bank at any reasonable time and from time to time upon reasonable
prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Bank and assignee representing that it is an Eligible Assignee,
together with any Note subject to such assignment, the Agent shall, if
such Assignment and Acceptance has been completed and is in substantially
the form of Exhibit "J" hereto, (i) accept such Assignment and Acceptance,
(ii) record the information contained therein in the Register, and (iii)
give prompt written notice thereof to the Borrowers. Within five (5)
Business Days after their receipt of such notice, the Borrowers, at their
expense, shall execute and deliver to the Agent in exchange for the
surrendered Notes new Notes to the order of such Eligible Assignee in an
amount equal to the Commitments assumed by it pursuant to such Assignment
and Acceptance and, if the assigning Bank has retained a portion of its
Commitments, new Notes to the order of the assigning Bank in an amount
equal to the Commitments retained by it hereunder (each such promissory
note shall constitute a "NOTE" for purposes of the Loan Documents). Such
new Notes shall be in an aggregate principal amount of the surrendered
Notes, shall be dated the effective date of such Assignment and
Acceptance, and shall otherwise be in substantially the form of Exhibits
"A-1" and "A-2" hereto.
(f) Any Bank may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section, disclose
to the assignee or participant or proposed assignee or participant, any
information relating to the Borrowers or its Subsidiaries furnished to
such Bank by or on behalf of either Borrower or its Subsidiaries.
(g) Any Bank may pledge or assign its Notes to any Federal Reserve
Bank in accordance with applicable law.
Section 15.8 SURVIVAL. All representations and warranties made in this
Agreement or any other Loan Document or in any document, statement, or
certificate furnished in connection with this Agreement shall survive the
execution and delivery of this Agreement and the other Loan Documents, and no
investigation by the Agent, the Documentation Agent, any Issuing Bank or any
Bank or any closing shall affect the representations and warranties or the right
of the Agent, the Documentation Agent, any Issuing Bank or any Bank to rely upon
them. Without prejudice to the survival of any other obligation of the Borrowers
hereunder, the obligations of the Borrowers under Article VI and Sections 15.1
and 15.2 shall survive repayment of the Notes and termination of the
Commitments.
Section 15.9 ENTIRE AGREEMENT. THIS AGREEMENT, THE NOTES, AND THE
OTHER LOAN DOCUMENTS REFERRED TO HEREIN EMBODY THE FINAL, ENTIRE
AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR
AMENDED AND RESTATED CREDIT AGREEMENT - Page 66
COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR
ORAL, RELATING TO THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED OR
VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR
DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE
PARTIES HERETO.
Section 15.10 AMENDMENTS, ETC. No amendment or waiver of any provision of
this Agreement, the Notes, or any other Loan Document to which either Borrower
is a party, nor any consent to any departure by either Borrower therefrom, shall
in any event be effective unless the same shall be agreed or consented to by
Required Banks and the Borrowers, and each such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; PROVIDED, that no amendment, waiver, or consent shall, unless in writing
and signed by all of the Banks and the Borrowers, do any of the following: (a)
increase the Commitments of the Banks or subject the Banks to any additional
obligations; (b) reduce the principal of, or interest on, the Notes or any fees
or other amounts payable to the Banks hereunder; (c) postpone any date fixed for
any payment of principal of, or interest on, the Notes or any fees or other
amounts payable to the Banks hereunder; (d) waive any of the conditions
specified in Article VIII; (e) change the percentage of the Commitments or of
the aggregate unpaid principal amount of the Notes or the number of Banks which
shall be required for the Banks or any of them to take any action under this
Agreement; (f) change any provision contained in this Section 15.11; or (g)
release any Collateral or any Guarantor. Notwithstanding anything to the
contrary contained in this Section, no amendment, waiver, or consent shall be
made with respect to Article XIV hereof without the prior written consent of the
Agent and no amendment, waiver, or consent shall be made with respect to Article
IV hereof without the prior written consent of the Issuing Banks.
Section 15.11 MAXIMUM INTEREST RATE. No provision of this Agreement or of
any other Loan Document shall require the payment or the collection of interest
in excess of the maximum amount permitted by applicable law. If any excess of
interest in such respect is hereby provided for, or shall be adjudicated to be
so provided, in any Loan Document or otherwise in connection with this loan
transaction, the provisions of this Section shall govern and prevail and neither
the Borrowers nor the sureties, guarantors, successors, or assigns of the
Borrowers shall be obligated to pay the excess amount of such interest or any
other excess sum paid for the use, forbearance, or detention of sums loaned
pursuant hereto. In the event any Bank ever receives, collects, or applies as
interest any such sum, such amount which would be in excess of the maximum
amount permitted by applicable law shall be applied as a payment and reduction
of the principal of the indebtedness evidenced by the Notes; and, if the
principal of the Notes has been paid in full, any remaining excess shall
forthwith be paid to the Borrowers. In determining whether or not the interest
paid or payable exceeds the Maximum Rate, the Borrowers and each Bank shall, to
the extent permitted by applicable law, (a) characterize any non-principal
payment as an expense, fee, or premium rather than as interest, (b) exclude
voluntary prepayments and the effects thereof, and (c) amortize, prorate,
allocate, and spread in equal or unequal parts the total amount of interest
throughout the entire contemplated term of the indebtedness evidenced by the
Notes so that interest for the entire term does not exceed the Maximum Rate.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 67
Section 15.12 NOTICES. All notices and other communications provided for
in this Agreement and the other Loan Documents to which either Borrower is a
party shall be given or made by telecopy or in writing and telecopied, mailed by
certified mail return receipt requested, or delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof; or, as to any party at such other address as shall be designated by such
party in a notice to each other party given in accordance with this Section.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telecopy, subject to
telephone confirmation of receipt, or when personally delivered or, in the case
of a mailed notice, when duly deposited in the mails, in each case given or
addressed as aforesaid; provided, however, notices to the Agent pursuant to
Article II, III and IV shall not be effective until received by the Agent.
SECTION 15.13 GOVERNING LAW; VENUE; SERVICE OF PROCESS. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT
HAS BEEN ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IT SHALL BE PERFORMABLE FOR
ALL PURPOSES IN DALLAS COUNTY, TEXAS. ANY ACTION OR PROCEEDING AGAINST EITHER
BORROWER UNDER OR IN CONNECTION WITH ANY OF THE LOAN DOCUMENTS MAY BE BROUGHT IN
ANY STATE OR FEDERAL COURT IN DALLAS COUNTY, TEXAS. EACH BORROWER HEREBY
IRREVOCABLY (A) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURTS, AND (B)
WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT OR THAT ANY SUCH COURT IS AN
INCONVENIENT FORUM. EACH BORROWER AGREES THAT SERVICE OF PROCESS UPON IT MAY BE
MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, AT ITS ADDRESS
SPECIFIED OR DETERMINED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 15.12.
NOTHING HEREIN OR IN ANY OF THE OTHER LOAN DOCUMENTS SHALL AFFECT THE RIGHT OF
THE AGENT, THE DOCUMENTATION AGENT, ANY ISSUING BANK OR ANY BANK TO SERVE
PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE
AGENT, THE DOCUMENTATION AGENT, ANY ISSUING BANK OR ANY BANK TO BRING ANY ACTION
OR PROCEEDING AGAINST EITHER BORROWER OR WITH RESPECT TO ANY OF ITS PROPERTY IN
COURTS IN OTHER JURISDICTIONS. ANY ACTION OR PROCEEDING BY EITHER BORROWER
AGAINST THE AGENT, THE DOCUMENTATION AGENT, ANY ISSUING BANK OR ANY BANK SHALL
BE BROUGHT ONLY IN A COURT LOCATED IN DALLAS COUNTY, TEXAS.
Section 15.14 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
AMENDED AND RESTATED CREDIT AGREEMENT - Page 68
Section 15.15 SEVERABILITY. Any provision of this Agreement held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Agreement and the effect thereof shall be
confined to the provision held to be invalid or illegal.
Section 15.16 HEADINGS. The headings, captions, and arrangements used in
this Agreement are for convenience only and shall not affect the interpretation
of this Agreement.
Section 15.17 CONSTRUCTION. Each of the Borrowers, the Agent, the
Documentation Agent, each Issuing Bank and each Bank acknowledge that each of
them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement and the other Loan Documents
with its legal counsel and that this Agreement and the other Loan Documents
shall be construed as if jointly drafted by the parties hereto.
Section 15.18 INDEPENDENCE OF COVENANTS. All covenants hereunder shall be
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitations of, another covenant shall
not avoid the occurrence of a Default if such action is taken or such condition
exists.
[Remainder of Page Intentionally Left Blank]
AMENDED AND RESTATED CREDIT AGREEMENT - Page 69
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
BORROWERS:
HEALTHCOR HOLDINGS, INC.
By: S. βββββ ββββββ
Chairman of the Board, Chief Executive Officer
and Secretary
Address for Notices:
ββββ βββββ βββββββ ββββββββββ
βββββ β-ββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: S. βββββ ββββββ
HEALTHCOR, INC.
By: S. βββββ ββββββ
Chairman of the Board
Address for Notices:
ββββ βββββ βββββββ ββββββββββ
βββββ β-ββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: S. βββββ ββββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 70
AGENT:
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION
By: ββββββ β. ββββββββ
Vice President
Address for Notices:
ββββ ββββ ββββββ, βββ βββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. ββββββ β. ββββββββ
Vice President
AMENDED AND RESTATED CREDIT AGREEMENT - Page 71
DOCUMENTATION AGENT:
THE FIRST NATIONAL BANK OF CHICAGO
By:
Name:
Title:
Address for Notices:
Public Banking Department
βββ βββββ ββββββββ βββββ, βββββ ββββ
βββββββ, ββββββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: Mr. ββββ Back
Corporate Banking Officer
AMENDED AND RESTATED CREDIT AGREEMENT - Page 72
ISSUING BANK:
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION
By: ββββββ β. ββββββββ
Vice President
Address for Notices:
ββββ ββββ ββββββ, βββ βββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. ββββββ β. ββββββββ
Vice President
AMENDED AND RESTATED CREDIT AGREEMENT - Page 73
BANKS:
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION
REVOLVING CREDIT COMMITMENT: By: ββββββ β. ββββββββ
$3,500,000 Vice President
ACQUISITION LINE COMMITMENT: Address for Notices:
$14,000,000 ββββ ββββ ββββββ, βββ βββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. ββββββ β. ββββββββ
Vice President
Lending Office for Alternate Base Rate Loans
ββββ ββββ ββββββ
ββββββ, βββββ βββββ
Lending Office for Eurodollar Loans
ββββ ββββ ββββββ
ββββββ, βββββ βββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 74
THE FIRST NATIONAL BANK OF CHICAGO
REVOLVING CREDIT COMMITMENT: By:
Name:
$3,500,000 Title:
ACQUISITION LINE COMMITMENT: Address for Notices:
$14,000,000 Public Banking Department
βββ βββββ ββββββββ βββββ, βββββ ββββ
βββββββ, ββββββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: Mr. ββββ Back
Corporate Banking Officer
Lending Office for Alternate Base Rate Loans
Public Banking Department
βββ βββββ ββββββββ βββββ, βββββ ββββ
βββββββ, ββββββββ βββββ
Lending Office for Eurodollar Loans
Public Banking Department
βββ βββββ ββββββββ βββββ, βββββ ββββ
βββββββ, ββββββββ βββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 75
THE BOATMEN'S NATIONAL BANK
OF ST. LOUIS
REVOLVING CREDIT COMMITMENT: By:
Name:
$1,600,000 Title:
ACQUISITION LINE COMMITMENT: Address for Notices:
$6,400,000 βββ ββββββ ββββββ
ββ. βββββ, ββββββββ βββββ-ββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. βββββ ββββββ
Lending Office for Alternate Base Rate Loans
βββ ββββββ ββββββ
ββ. βββββ, ββββββββ βββββ
Lending Office for Eurodollar Loans
βββ ββββββ ββββββ
ββ. βββββ, ββββββββ βββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 76
FLEET BANK, N.A.
REVOLVING CREDIT COMMITMENT: By:
Name:
$2,400,000 Title:
ACQUISITION LINE COMMITMENT: Address for Notices:
$9,600,000 1133 Avenue of the ββββββββ, ββββ βββββ
βββ ββββ, βββ ββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. βββββββ ββββββ
Lending Office for Alternate Base Rate Loans
1133 Avenue of the ββββββββ, ββββ βββββ
βββ ββββ, βββ ββββ βββββ
Lending Office for Eurodollar Loans
1133 Avenue of the ββββββββ, ββββ βββββ
βββ ββββ, βββ ββββ βββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 77
BANK OF AMERICA TEXAS, N.A.
REVOLVING CREDIT COMMITMENT: By: J. βββββ ββββββ
$2,400,000 Senior Vice President
ACQUISITION LINE COMMITMENT:
$9,600,000 By: βββββββ β. ββββββββ
Vice President
Address for Notices:
ββββ β. ββββ βββββββββ βββββββ, ββββ #ββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. βββββββ β. ββββββββ
Lending Office for Alternate Base Rate Loans
ββββ β. ββββ βββββββββ βββββββ, ββββ #ββββ
ββββββ, βββββ βββββ
Lending Office for Eurodollar Loans
ββββ β. ββββ βββββββββ βββββββ, ββββ #ββββ
ββββββ, βββββ βββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 78
HIBERNIA NATIONAL BANK
REVOLVING CREDIT COMMITMENT: By:
Name:
$1,600,000 Title:
ACQUISITION LINE COMMITMENT: Address for Notices:
$6,400,000 βββ ββββββββββ ββββββ
βββ βββββββ, βββββββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββ. βββββββ ββββ
Lending Office for Alternate Base Rate Loans
βββ ββββββββββ ββββββ
βββ βββββββ, βββββββββ βββββ
Lending Office for Eurodollar Loans
βββ ββββββββββ ββββββ
βββ βββββββ, βββββββββ βββββ
AMENDED AND RESTATED CREDIT AGREEMENT - Page 79
INDEX TO EXHIBITS
EXHIBIT DESCRIPTION OF EXHIBIT SECTION
------- ---------------------- -------
"A-1" Form of Revolving Credit Note 2.2
"A-2" Form of Acquisition Line Note 3.2
"B-1" Loan Request Form 5.1
"B-2" Notice of Continuation or Conversion 5.2
"C" Letter of Credit Request Form 4.3
"D-1" Borrower Security Agreement 7.1(a)
"D-2" Subsidiary Security Agreement 7.1(b)
"E-1" Subsidiary Guaranty 7.3
"E-2" Borrower Guaranty 7.3
"F" Pledge Agreement 7.1(c)
"G" Assignment of Deposit Accounts 7.2
"H" Contribution and Indemnification Agreement 8.1(r)
"I" Matters to be Addressed by Opinion of Counsel
for the Companies 8.1(y)
"J" Assignment and Acceptance 15.7
"K" Compliance Certificate 10.1(c)
INDEX TO SCHEDULES
SCHEDULE DESCRIPTION OF SCHEDULE SECTION
1 Companies 9.14
2 Litigation 9.5
3 Existing Debt 9.9
4 Existing Liens 11.2
5 Historical Acquired EBITDA 1.1
SCHEDULE 1
LIST OF SUBSIDIARIES
=================================================================================================
PERCENTAGE OF
NAME OF JURISDICTION OF VOTING STOCK OWNED QUALIFIED TO DO
SUBSIDIARY INCORPORATION BY HOLDINGS BUSINESS IN
-------------------------------------------------------------------------------------------------
HealthCor, Inc. Delaware 100% Arkansas, Kansas,
Missouri, New Mexico,
Oklahoma, Texas
-------------------------------------------------------------------------------------------------
HealthCor Pharmacy, Inc. Texas 100% Arkansas, Colorado,
Kansas, Missouri,
Oklahoma
-------------------------------------------------------------------------------------------------
HealthCor Oxygen and Texas 100% Arkansas, Colorado,
Medical Equipment, Inc. Kansas, Missouri, New
Mexico, Oklahoma
-------------------------------------------------------------------------------------------------
HealthCor Rehabilitation Texas 100% None
Services, Inc.
-------------------------------------------------------------------------------------------------
Physicians Home Health Missouri 100% None
Network, Inc.
-------------------------------------------------------------------------------------------------
HC Personnel Resources, Texas 100% None
Inc.
=================================================================================================
SCHEDULE 2
EXISTING LITIGATION
NONE
SCHEDULE 3
EXISTING DEBT
SCHEDULE 4
EXISTING LIENS
NONE
SCHEDULE 5
HISTORICAL ACQUIRED EBITDA
EXHIBIT "A-1"
FORM OF REVOLVING CREDIT NOTE
REVOLVING CREDIT NOTE
$FIG_AMT~ Dallas, Texas October 31, 1996
FOR VALUE RECEIVED, the undersigned, HEALTHCOR, INC., a Delaware
corporation ("Maker"), hereby promises to pay to the order of PAYEE~, a
ENTITY_PAYEE~ ("Payee"), at the offices of Texas Commerce Bank National
Association, a national banking association, as agent (in such capacity,
"Agent"), located at ββββ ββββ ββββββ, ββββββ, βββββ βββββ or at such other
location as Agent may designate to Maker in writing, for the account of the
Applicable Lending Office (as defined in the Agreement referred to below) of
Payee, in lawful money of the United States of America and in immediately
available funds, the principal sum of DOLLAR_AMOUNT~/100 DOLLARS ($FIG_AMT~), or
such lesser amount as shall equal the aggregate unpaid principal amount of the
Revolving Credit Loans made by Payee to Maker under the Agreement referred to
below on the dates and in the principal amounts provided in such Agreement, and
to pay interest on the amount of each such Revolving Credit Loan, at such
office, in like money and funds, for the period commencing on the date of such
Revolving Credit Loan until the Revolving Credit Loan shall be paid in full, at
the rates per annum and on the dates provided in the Agreement.
This Note (the "Note") has been executed and delivered by Maker pursuant
to the terms of that certain Amended and Restated Credit Agreement (as the same
may be amended, supplemented or modified from time to time, the "Agreement") of
even date herewith, among Maker, HealthCor Holdings, Inc., a Delaware
corporation ("Holdings"), Payee and the other lenders from time to time party
thereto (collectively, the "Banks"), the Issuing Banks (as defined in the
Agreement), The First National Bank of Chicago, a national banking association,
as documentation agent (the "Documentation Agent"), and the Agent and is one of
the Revolving Credit Notes described therein. Capitalized terms used and not
otherwise defined herein shall have the same meanings as set forth in the
Agreement. Reference is hereby made to the Agreement for provisions affecting
this Note including, but not limited to, provisions regarding interest rates,
repayments, prepayments, Events of Default, and Payee's rights as a result of
the occurrence thereof.
This Note and the other Revolving Credit Notes are in renewal, extension
and modification, but not extinguishment, of the outstanding indebtedness
evidenced by those certain Revolving Credit Notes previously executed by Maker
and delivered pursuant to that certain Credit Agreement dated May 16, 1996 among
Maker, Holdings, the lenders party thereto (the "Existing Banks"), the Existing
Banks issuing Letters of Credit thereunder and Texas Commerce Bank National
Association, as agent.
Subject to the terms of the Agreement and as otherwise calculated in
accordance with the Agreement, the outstanding principal balance hereof shall
bear interest prior to maturity at a
REVOLVING CREDIT NOTE - Page 1
varying rate per annum which shall from day to day be equal to the lesser of (a)
the Maximum Rate or (b) the Applicable Rate. If at any time the Applicable Rate
shall exceed the Maximum Rate, thereby causing the interest rate hereon to be
limited to the Maximum Rate, then any subsequent reduction in the Applicable
Rate shall not reduce the rate of interest hereon below the Maximum Rate until
the total amount of interest accrued hereon equals the amount of interest which
would have accrued hereon if the Applicable Rate had at all times been in
effect.
The outstanding principal balance of this Note, together with all accrued
and unpaid interest thereon, shall be due and payable on the Revolving Credit
Termination Date. Accrued and unpaid interest on the outstanding principal
balance hereof shall be due and payable as provided in Section 2.4 of the
Agreement. All past due principal and interest shall bear interest at the
Default Rate.
Maker may prepay the principal of this Note upon the terms and conditions
specified in the Agreement. Maker may borrow, repay, and reborrow hereunder upon
the terms and conditions specified in the Agreement.
If the holder hereof expends any effort in any attempt to enforce payment
of all or any part or installment of any sum due the holder hereunder, or if
this Note is placed in the hands of an attorney for collection, or if it is
collected through any legal proceedings, Maker agrees to pay all reasonable
costs, expenses, and fees incurred by the holder, including reasonable
attorneys' fees.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
THIS NOTE IS PERFORMABLE IN DALLAS COUNTY, TEXAS.
Maker and each surety, guarantor, endorser, and other party ever liable
for payment of any sums of money payable on this Note jointly and severally
waive notice, presentment, demand for payment, protest, notice of protest and
non-payment or dishonor, notice of acceleration, notice of intent to accelerate,
notice of intent to demand, diligence in collecting, grace, and all other
formalities of any kind, and consent to all extensions without notice for any
period or periods of time and partial payments, before or after maturity, all
without prejudice to the holder. The holder shall similarly have the right to
deal in any way, at any time, with one or more of the foregoing parties without
notice to any other party, and to grant any such party any extensions of time
for payment of any of said indebtedness, or to grant any other indulgences or
forbearances whatsoever, without notice to any other party and without in any
way affecting the personal liability of any party hereunder.
Maker hereby authorizes the holder hereof to record in its internal
records the amount and Type of all Loans made to Maker hereunder and all
continuations, conversions, and payments of principal in respect of such Loans,
which recordings shall be prima facie evidence as to the
REVOLVING CREDIT NOTE - Page 2
outstanding principal balance of this Note; provided, however, any failure by
the holder hereof to make any such recording shall not limit or otherwise affect
the obligations of Maker under the Agreement or this Note.
HEALTHCOR, INC.
By:
S. βββββ ββββββ,
Chairman of the Board
REVOLVING CREDIT NOTE - Page 3
EXHIBIT "A-2"
FORM OF ACQUISITION LINE NOTE
ACQUISITION LINE NOTE
$FIELD-1~ Dallas, Texas October 31, 1996
FOR VALUE RECEIVED, the undersigned, HEALTHCOR HOLDINGS, INC., a
Delaware corporation ("Maker"), hereby promises to pay to the order of FIELD-2~
("Payee") at the offices of Texas Commerce Bank National Association, a national
banking association, as agent ("Agent"), located at ββββ ββββ ββββββ, ββββββ,
βββββ βββββ, or at such other location as Agent may designate to Maker in
writing, for the account of the Applicable Lending Office (as defined in the
Agreement referred to below) of Payee on the Acquisition Line Maturity Date (as
defined in the Agreement referred to below), in lawful money of the United
States of America and in immediately available funds, the principal sum of
FIELD-3~DOLLARS ($FIELD-1~), or, if less, the then unpaid principal amount of
all Acquisition Line Loans (as defined in the Agreement) made by Payee to Maker
pursuant to the Agreement, together with interest on the outstanding principal
balance from day to day remaining at the rates per annum and on the dates
provided in the Agreement (hereinafter defined).
This Note has been executed and delivered by Maker pursuant to the terms
of that certain Amended and Restated Credit Agreement of even date herewith,
among Maker, HealthCor, Inc., a Delaware corporation, Payee, The First National
Bank of Chicago, as documentation agent, certain other lenders from time to time
party thereto (collectively, the "Banks"), the Issuing Banks (as defined in the
Agreement), and the Agent (as the same may be amended, supplemented or modified
from time to time, the "Agreement") and is one of the Acquisition Line Notes
described therein. This Note and the other initial Acquisition Line Notes are
executed in partial renewal, extension and modification, but not in
extinguishment of, certain of the obligations, indebtedness and liabilities of
Payee evidenced by certain Term Notes dated September 3, 1996, executed by Payee
and payable to The First National Bank of Chicago in the principal amount of
$4,285,714.28 and to Texas Commerce Bank in the original principal amount of
$5,714,285.72. All capitalized terms used and not otherwise defined herein shall
have the same meanings as set forth in the Agreement. Reference is hereby made
to the Agreement for provisions affecting this Note including, but not limited
to, provisions regarding interest rates, repayments, prepayments, Events of
Default and Payee's rights as a result of the occurrence thereof. Maker may
prepay all or any portion of the principal amount of this Note upon the terms
and conditions specified in the Agreement.
Subject to the terms of the Agreement and as otherwise calculated in
accordance with the terms of the Agreement, the outstanding principal balance
hereof shall bear interest prior to maturity at a varying rate per annum which
shall from day to day be equal to the lesser of (a) the Maximum Rate, or (b) the
Applicable Rate. If at any time the Applicable Rate shall exceed the Maximum
Rate, thereby causing the interest rate hereon to be limited to the Maximum
Rate, then any subsequent reduction in the Applicable Rate will not reduce the
rate of interest hereon below the Maximum Rate until the total amount of
interest accrued hereon equals the amount of interest which would have accrued
hereon if the Applicable Rate had at all times been in effect. The outstanding
principal balance of this Note, together with interest thereon, shall be due and
payable on the dates and in the amounts set forth in the Agreement. Accrued and
unpaid interest
ACQUISITION LINE NOTE - Page 1
on the outstanding principal balance hereof shall be due and payable as provided
in Section 3.4 of the Agreement. All past due principal and interest shall bear
interest at the Default Rate.
If the holder hereof expends any effort in any attempt to enforce payment
of all or any part or installment of any sum due the holder hereunder, or if
this Note is placed in the hands of an attorney for collection, or if it is
collected through any legal proceedings, Maker agrees to pay all collection
costs and fees incurred by the holder, including reasonable attorneys' fees.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
THIS NOTE IS PERFORMABLE IN DALLAS COUNTY, TEXAS.
Maker and each surety, guarantor, endorser, and other party ever liable
for payment of any sums of money payable on this Note jointly and severally
waive notice, presentment, demand for payment, protest, notice of protest and
non-payment or dishonor, notice of acceleration, notice of intent to accelerate,
notice of intent to demand, diligence in collecting, grace, and all other
formalities of any kind, and consent to all extensions without notice for any
period or periods of time and partial payments, before or after maturity, and
any impairment of any collateral securing this Note, all without prejudice to
the holder. The holder shall similarly have the right to deal in any way, at any
time, with one or more of the foregoing parties without notice to any other
party, and to grant any such party any extensions of time for payment of any of
said indebtedness, or to release or substitute part or all of the collateral
securing this Note, or to grant any other indulgences or forbearances
whatsoever, without notice to any other party and without in any way affecting
the personal liability of any party hereunder.
HEALTHCOR HOLDINGS, INC.
By:S. βββββ ββββββ
Chairman of the Board, Chief Executive
Officer and Secretary
ACQUISITION LINE NOTE - Page 2
EXHIBIT "A-2"
FORM OF ACQUISITION LINE NOTE
ACQUISITION LINE NOTE
$FIELD-1~ Dallas, Texas October 31, 1996
FOR VALUE RECEIVED, the undersigned, HEALTHCOR HOLDINGS, INC., a
Delaware corporation ("Maker"), hereby promises to pay to the order of FIELD-2~
("Payee") at the offices of Texas Commerce Bank National Association, a national
banking association, as agent ("Agent"), located at ββββ ββββ ββββββ, ββββββ,
βββββ βββββ, or at such other location as Agent may designate to Maker in
writing, for the account of the Applicable Lending Office (as defined in the
Agreement referred to below) of Payee on the Acquisition Line Maturity Date (as
defined in the Agreement referred to below), in lawful money of the United
States of America and in immediately available funds, the principal sum of
FIELD-3~DOLLARS ($FIELD-1~), or, if less, the then unpaid principal amount of
all Acquisition Line Loans (as defined in the Agreement) made by Payee to Maker
pursuant to the Agreement, together with interest on the outstanding principal
balance from day to day remaining at the rates per annum and on the dates
provided in the Agreement (hereinafter defined).
This Note has been executed and delivered by Maker pursuant to the terms
of that certain Amended and Restated Credit Agreement of even date herewith,
among Maker, HealthCor, Inc., a Delaware corporation, Payee, The First National
Bank of Chicago, as documentation agent, certain other lenders from time to time
party thereto (collectively, the "Banks"), the Issuing Banks (as defined in the
Agreement), and the Agent (as the same may be amended, supplemented or modified
from time to time, the "Agreement") and is one of the Acquisition Line Notes
described therein. This Note and the other initial Acquisition Line Notes are
executed in partial renewal, extension and modification, but not in
extinguishment of, certain of the obligations, indebtedness and liabilities of
Payee evidenced by certain Term Notes dated September 3, 1996, executed by Payee
and payable to The First National Bank of Chicago in the principal amount of
$4,285,714.28 and to Texas Commerce Bank in the original principal amount of
$5,714,285.72. All capitalized terms used and not otherwise defined herein shall
have the same meanings as set forth in the Agreement. Reference is hereby made
to the Agreement for provisions affecting this Note including, but not limited
to, provisions regarding interest rates, repayments, prepayments, Events of
Default and Payee's rights as a result of the occurrence thereof. Maker may
prepay all or any portion of the principal amount of this Note upon the terms
and conditions specified in the Agreement.
Subject to the terms of the Agreement and as otherwise calculated in
accordance with the terms of the Agreement, the outstanding principal balance
hereof shall bear interest prior to maturity at a varying rate per annum which
shall from day to day be equal to the lesser of (a) the Maximum Rate, or (b) the
Applicable Rate. If at any time the Applicable Rate shall exceed the Maximum
Rate, thereby causing the interest rate hereon to be limited to the Maximum
Rate, then any subsequent reduction in the Applicable Rate will not reduce the
rate of interest hereon below the Maximum Rate until the total amount of
interest accrued hereon equals the amount of interest which would have accrued
hereon if the Applicable Rate had at all times been in effect. The outstanding
principal balance of this Note, together with interest thereon, shall be due and
payable on the dates and in the amounts set forth in the Agreement. Accrued and
unpaid interest
ACQUISITION LINE NOTE - Page 1
on the outstanding principal balance hereof shall be due and payable as provided
in Section 3.4 of the Agreement. All past due principal and interest shall bear
interest at the Default Rate.
If the holder hereof expends any effort in any attempt to enforce payment
of all or any part or installment of any sum due the holder hereunder, or if
this Note is placed in the hands of an attorney for collection, or if it is
collected through any legal proceedings, Maker agrees to pay all collection
costs and fees incurred by the holder, including reasonable attorneys' fees.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
THIS NOTE IS PERFORMABLE IN DALLAS COUNTY, TEXAS.
Maker and each surety, guarantor, endorser, and other party ever liable
for payment of any sums of money payable on this Note jointly and severally
waive notice, presentment, demand for payment, protest, notice of protest and
non-payment or dishonor, notice of acceleration, notice of intent to accelerate,
notice of intent to demand, diligence in collecting, grace, and all other
formalities of any kind, and consent to all extensions without notice for any
period or periods of time and partial payments, before or after maturity, and
any impairment of any collateral securing this Note, all without prejudice to
the holder. The holder shall similarly have the right to deal in any way, at any
time, with one or more of the foregoing parties without notice to any other
party, and to grant any such party any extensions of time for payment of any of
said indebtedness, or to release or substitute part or all of the collateral
securing this Note, or to grant any other indulgences or forbearances
whatsoever, without notice to any other party and without in any way affecting
the personal liability of any party hereunder.
HEALTHCOR HOLDINGS, INC.
By:S. βββββ ββββββ
Chairman of the Board, Chief Executive
Officer and Secretary
ACQUISITION LINE NOTE - Page 2
EXHIBIT "B-1"
LOAN REQUEST FORM
LOAN REQUEST FORM
TO: TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
as Agent
ββββ ββββ ββββββ
ββββ ββββββ βββ ββββββ
ββββββ, βββββ βββββ-ββββ
Attention: ββββββ β. ββββββββ
Ladies and Gentlemen:
The undersigned is an officer of HEALTHCOR, INC./HEALTHCOR HOLDINGS, INC.
[as applicable], a Delaware corporation (the "Borrower"), and is authorized to
make and deliver this certificate pursuant to that certain Amended and Restated
Credit Agreement dated as of October 31, 1996, among HealthCor, Inc., HealthCor
Holdings, Inc., Texas Commerce Bank National Association, a national banking
association, as agent (in such capacity, the "Agent"), The First National Bank
of Chicago, as documentation agent (the "Documentation Agent"), certain other
lenders from time to time party thereto (collectively, the "Banks") and the
Banks from time to time issuing letters of credit thereunder (the "Issuing
Banks") (such Credit Agreement, as the same may be amended, supplemented or
modified from time to time, being hereinafter referred to as the "Credit
Agreement"). All terms defined in the Credit Agreement shall have the same
meanings herein.
In accordance with the Credit Agreement, the undersigned Borrower hereby
requests that the Lender make the Loan requested on schedule or schedules
attached hereto (the "Requested Loan").
In connection with the foregoing and pursuant to the terms and provisions
of the Credit Agreement, the undersigned hereby certifies to the Agent, the
Documentation Agent, the Banks and the Issuing Banks that the following
statements are true and correct:
(i) The representations and warranties contained in Article IX of
the Credit Agreement and in each of the other Loan Documents are true and
correct on and as of the date hereof with the same force and effect as if
made on and as of such date.
(ii) No Default has occurred and is continuing or would result from
the Requested Loan.
(iii) All information supplied on the schedule or schedules and
officer's certificate attached hereto is true, correct, and complete as of
the date hereof.
BORROWER:
[HEALTHCOR, INC./
HEALTHCOR HOLDINGS, INC.]
By:
Name:
Title:
Dated as of:___________________
[insert date of
Requested Loan]
-2-
SCHEDULE 1
TO
LOAN REQUEST FORM
Revolving Credit Loan
REQUEST INFORMATION
(1) Revolving Credit Commitment...............................$15,000,000.00
(2) Aggregate outstanding principal amount of all Revolving
Credit Loans...................................................$_________
(3) Aggregate amount of all Letter of Credit Liabilities...........$_________
(4) Available Revolving Credit Commitment [line (1) minus the sum of
line (2) and line (3)].........................................$_________
(5) Amount of requested Revolving Credit Loan1.....................$_________
(6) Type of requested Revolving Credit Loan (check whichever is applicable):
_____ Alternate Base Rate Loan
_____ Eurodollar Loan having an Interest Period of:
_____ one month
_____ two months
_____ three months
_____ six months
(7) Number of Interest Periods currently in effect................._________
(8) Date of requested Revolving Credit Loan................._________, 19___
--------
1 The requested Revolving Credit Loan must be in an amount equal to or less
than the amount shown on line (4) above.
SCHEDULE 2
TO
LOAN REQUEST FORM
ACQUISITION LINE LOAN REQUEST INFORMATION
(1) Amount of requested Acquisition Line Loan.....................$_________
(2) Type of requested Acquisition Line Loan (check whichever is applicable):
_____ Alternate Base Rate Loan
_____ Eurodollar Loan having an Interest Period of:
_____ one month
_____ two months
_____ three months
_____ six months
(3) Number of Interest Periods currently in effect................._________
(4) Date of requested Acquisition Line Loan................._________, 19___
Attached hereto is the certificate of the Chief Financial Officer of Holdings
certifying to and demonstrating compliance with each of the financial covenants
contained in Article XII of the Credit Agreement, after giving effect to the
proposed acquisition to be financed with the proceeds of the Acquisition Line
Loan requested hereby.
EXHIBIT "C"
LETTER OF CREDIT REQUEST FORM
LETTER OF CREDIT REQUEST FORM
TO: Texas Commerce Bank National Association,
as an Issuing Bank
ββββ ββββ ββββββ
ββββ ββββββ βββ ββββββ
ββββββ, βββββ βββββ-ββββ
Attention: ββββββ β. ββββββββ
Ladies and Gentlemen:
The undersigned is an officer of HEALTHCOR, INC., a Delaware corporation
(the "Borrower"), and is authorized to make and deliver this certificate
pursuant to that certain Amended and Restated Credit Agreement dated as of
October 31, 1996, among Borrower, HealthCor Holdings, Inc., a Delaware
corporation, Texas Commerce Bank National Association, as agent (in such
capacity, the "Agent"), The First National Bank of Chicago, as documentation
agent (the "Documentation Agent"), the lenders from time to time party thereto
(collectively, the "Banks"), and the Banks from time to time issuing letters of
credit thereunder (in such capacity, the "Issuing Banks") (as the same may be
amended, supplemented or modified from time to time, the "Credit Agreement").
All terms defined in the Credit Agreement shall have the same meanings herein.
In accordance with the Credit Agreement, the Borrower hereby requests that
the Issuing Bank issue a Letter of Credit. The Letter of Credit shall:
(a) be issued on ________________, 19___;1
(b) be in the amount of $____________;2
(c) permit [a single drawing/multiple drawings]3 on the terms and
conditions set forth in the L/C Application attached as Annex
I hereto;
--------
1 Insert date not later than the Revolving Credit Termination Date.
2 Insert face amount of Letter of Credit. Issuance is subject to
Dollar limit on aggregate face amount of Letters of Credit specified
in Section 4.1 of the Credit Agreement ($2,000,000).
3 Specify one.
LETTER OF CREDIT REQUEST FORM - Page 1
(d) be payable upon presentation of a [sight draft/time draft. The
time draft shall be payable on __________________, 19___];4
and
(e) expire on __________________, 19___.4
The Letter of Credit is to be delivered by the Issuing Bank to
_____________________.5
[Drawing/Each drawing]3 under the Letter of Credit shall be subject to the
conditions specified in the L/C Application attached as Annex I hereto.
In connection with the foregoing and pursuant to the terms and provisions
of the Credit Agreement, the undersigned hereby certifies that the following
statements are true and correct:
(i) The representations and warranties contained in Article IX of the
Credit Agreement and in each of the other Loan Documents are true and
correct on and as of the date hereof with the same force and effect as if
made on and as of such date.
(ii) No Default has occurred and is continuing or would result from the
issuance of the Letter of Credit requested hereunder.
(iii) The face amount of the Letter of Credit requested hereunder, when
added to all outstanding Revolving Credit Loans and Letter of Credit
Liabilities, will not exceed the aggregate amount of the Revolving Credit
Commitments.
(iv) The proposed terms of the Letter of Credit requested hereunder and
the transactions proposed to be supported thereby are accurately and
completely described on the L/C Application attached as Annex I hereto.
(v) All information supplied below is true, correct, and complete as
of the date hereof.
INFORMATION
(a) Revolving Credit Commitment .................... $15,000,000.00
(b) Aggregate outstanding principal amount of all
Revolving Credit Loans.......................... $____________
(c) Aggregate outstanding amount of all Letter of
Credit Liabilities ............................. $____________
--------
4 Insert date not later than the earlier of (a) one year after
issuance or (b) the Revolving Credit Termination Date.
5 Insert name of Borrower or name and address of beneficiary.
LETTER OF CREDIT REQUEST FORM - Page 2
(d) Net availability for Letters of Credit: [line (a) minus the
sum of line (b) and line (c)] .................. $____________
(e) Face Amount of requested Letter of Credit ...... $____________
(f) Date requested for issuance of Letter of Credit . _______, 19__
BORROWER:
HEALTHCOR, INC.
By:
Name:
Title:
Dated as of:__________________
[insert date of
proposed issuance
of Letter of Credit]
LETTER OF CREDIT REQUEST FORM - Page 3
ANNEX 1
TO
LETTER OF CREDIT REQUEST FORM
L/C APPLICATION
EXHIBIT "D-1"
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT
This AMENDED AND RESTATED BORROWER SECURITY AGREEMENT (this
"Agreement") dated as of October 31, 1996, is by and among HEALTHCOR, INC., a
Delaware corporation ("HealthCor"), HEALTHCOR HOLDINGS, INC., a Delaware
corporation ("Holdings," and together with HealthCor, the "Debtors" and
individually, a "Debtor"), and TEXAS COMMERCE BANK NATIONAL ASSOCIATION, a
national banking association, as agent (in such capacity, the "Agent") for
itself, the Documentation Agent (hereinafter defined), the Issuing Banks
(hereinafter defined) and the Banks (hereinafter defined).
R E C I T A L S:
A. The Debtors, the Agent, certain lenders (collectively, the "Existing
Banks"), and the Existing Banks issuing letters of credit thereunder (in such
capacity, the "Existing Issuing Banks") previously entered into that certain
Credit Agreement dated as of May 16, 1996 (as amended, the "Existing Credit
Agreement").
B. Pursuant to the Existing Credit Agreement, each of the Debtors executed
and delivered to the Agent a Security Agreement dated as of May 16, 1996, which
secured the obligations of the Debtors under the Existing Credit Agreement
(collectively, the "Existing Security Agreements").
C. Concurrently herewith the Debtors, the Agent, The First National Bank
of Chicago, a national banking association, as documentation agent (in such
capacity, the "Documentation Agent"), certain lenders (together with any other
lenders that may from time to time become a party thereto, the "Banks"), and the
Banks issuing letters of credit thereunder (in such capacity, the "Issuing
Banks") are entering into that certain Amended and Restated Credit Agreement of
even date herewith (as the same may be amended, supplemented or modified from
time to time, being hereinafter referred to as the "Credit Agreement").
D. The parties hereto now desire to amend and restate the Existing
Security Agreements, as hereinafter provided, and have agreed, for purposes of
clarity and ease of administration, to carry out the agreed upon amendments by
amending the pertinent provisions of the Existing Security Agreements and then
consolidating and restating the Existing Security Agreements, insofar as they
relate to property of the Debtors, in their entirety by means of this Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows and the Existing Security
Agreements are hereby amended, consolidated and restated in their entireties as
follows:
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 1
ARTICLE I
DEFINITIONS; SECURITY INTEREST
Section 1.1 DEFINITIONS. All capitalized terms used and not otherwise
defined herein shall have their respective meanings as set forth in the Credit
Agreement.
Section 1.2 SECURITY INTEREST. Each of the Debtors hereby grants to the
Agent for the benefit of itself, the Documentation Agent, the Banks and the
Issuing Banks, and confirms that the Agent has previously been granted and now
possesses, a security interest in the following property, whether now owned or
existing or hereafter acquired or arising and wherever arising or located (such
property being hereinafter sometimes called the "Collateral"):
(ACCOUNTS)
(a) All accounts, receivables, accounts receivable, general
intangibles, book debts, contract rights, instruments, and documents
(including, without limitation, all documents of title); (b) all chattel
paper, notes, drafts, acceptances, other evidences, and forms of payment
under leases of equipment or contracts for the sale of inventory or the
performance of services, and other forms of obligations received by or
belonging to such Debtor for goods sold or leased and/or services rendered
by such Debtor; (c) all of the rights of such Debtor in, to, and under all
purchase orders, sales contracts, instruments, and other documents
evidencing obligations for or representing payment for goods sold or
leased and/or services rendered by such Debtor; and (d) all moneys due or
to become due to such Debtor under all contracts for the sale or lease of
goods and/or the performance of services by such Debtor; in each case of
whatever nature, now owned by such Debtor or existing or hereafter
acquired, created, or arising and the rights and interests of such Debtor
in goods, the sale and delivery of which give rise to any and all proceeds
of any of the foregoing Collateral (including, but not limited to, all
insurance and claims for insurance in respect of the Collateral).
(INVENTORY)
All goods, merchandise, raw materials, goods in process, finished
goods, and other tangible personal property of whatever nature now owned
by such Debtor or hereafter from time to time existing or acquired, and
held for sale or lease or furnished or to be furnished under contracts of
service or used or usable or consumed or consumable in such Debtor's
business and all accessions and appurtenances thereto, and all accounts,
receivables, accounts receivables, instruments, notes, chattel paper,
documents (including, without limitation, all documents of title),
contract rights, and general intangibles arising in connection with any of
the foregoing and all products and proceeds of any of the foregoing
Collateral (including, without limitation, all insurance and claims for
insurance effective or held for the benefit of such Debtor or the Agent in
respect of any of the foregoing Collateral).
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 2
(EQUIPMENT)
All goods, equipment, machinery, furnishings, fixtures, furniture,
appliances, accessories, leasehold improvements, chattels, and other
articles of personal property of whatever nature now owned by such Debtor
or hereafter acquired, all accessions and appurtenances thereto, and all
renewals or replacements of or substitutions for any of the foregoing and
all proceeds of any of the foregoing Collateral (including, but not
limited to, all insurance and claims for insurance in respect of any of
the foregoing Collateral).
Section 1.3 OBLIGATIONS. The Collateral shall secure the following
obligations, indebtedness, and liabilities (all such obligations, indebtedness,
and liabilities being hereinafter sometimes called the "Obligations"): (a) with
respect to Holdings, the obligations, indebtedness, and liabilities of HealthCor
to the Banks and the Issuing Banks evidenced by the Revolving Credit Notes
(herein so called) executed by HealthCor pursuant to the Credit Agreement; (b)
with respect to HealthCor, the obligations, indebtedness, and liabilities of
Holdings to the Banks evidenced by the Acquisition Line Notes executed by
Holdings pursuant to the Credit Agreement; (c) the obligations, indebtedness,
and liabilities of the Debtors to the Agent, the Documentation Agent, the Banks
and the Issuing Banks under the Credit Agreement; (d) the obligations,
indebtedness, and liabilities of the Debtors to the Agent, the Documentation
Agent, the Banks and the Issuing Banks under that certain guaranty agreement of
even date herewith, executed by the Debtors in favor of the Agent, the
Documentation Agent, the Banks and the Issuing Banks, pursuant to the Credit
Agreement, (e) all future advances by the Banks and the Issuing Banks to either
Debtor; (f) all costs and expenses, including without limitation all attorneys'
fees and legal expenses, incurred by the Agent, the Documentation Agent, the
Banks and the Issuing Banks to preserve and maintain the Collateral, collect the
obligations herein described, and enforce this Agreement; (g) all other
Obligations (as such term is defined in the Credit Agreement); and (h) all
extensions, renewals, and modifications of any of the foregoing.
Section 1.4 RENEWAL OF OBLIGATIONS AND LIENS. The parties hereto
acknowledge and agree that (a) the Revolving Credit Notes and the Acquisition
Line Notes are in renewal, extension and modification, but not in extinguishment
of, certain of the existing indebtedness of the Debtors under the Existing
Credit Agreement, and (b) such existing indebtedness is secured by liens and
security interests granted by the Debtors pursuant to the Existing Security
Agreements, which liens and security interests are not extinguished or released,
but instead are hereby renewed, extended, carried forward and continued in
accordance with the terms of this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
To induce the Agent to enter into this Agreement and to induce the Banks
and the Issuing Banks to extend credit to the Debtors under the Credit
Agreement, each Debtor represents and warrants to the Agent, the Documentation
Agent, the Banks and the Issuing Banks that:
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 3
Section 2.1 TITLE. Except for the Permitted Liens, such Debtor owns, and
with respect to Collateral acquired after the date hereof such Debtor will own,
the Collateral free and clear of any Lien.
Section 2.2 ACCOUNTS. Each Debtor represents, warrants, and covenants that
each and all of its accounts will meet the following requirements continuously
from the time each of them comes into existence until it is collected in full:
(a) the account arose from the performance of services by such Debtor which
services have been fully and satisfactorily performed or from the absolute sale
of goods by such Debtor in which such Debtor had the sole and complete
ownership, and the goods have been shipped or delivered to the account debtor,
evidencing which such Debtor or the Agent has possession of shipping and
delivery receipts; (b) the account is not subject to setoff, counterclaim,
defense, allowance or adjustment other than discounts for prompt payment shown
on the invoice or to dispute, objection or complaint by the account debtor
concerning his or its liability on the account, and the goods, the sale of which
gives rise to the account, have not been returned, rejected, lost, or damaged;
(c) the account arose in the ordinary course of such Debtor's business, and no
notice of bankruptcy, insolvency, or financial embarrassment of the account
debtor has been received by such Debtor; and (d) such Debtor shall notify the
Agent promptly in writing when any account ceases to meet any of the
requirements of this Agreement. Nothing in this Section shall be construed to
limit or release any right of the Agent to any Collateral arising pursuant to
Section 1.2 of this Agreement.
Section 2.3 FINANCING STATEMENTS. No financing statement, security
agreement, or other lien instrument covering all or any part of the Collateral
is on file in any public office, except as may have been filed in favor of the
Agent or to perfect any Permitted Lien.
Section 2.4 ORGANIZATION AND AUTHORITY. Each Debtor is a corporation duly
organized, validly existing, and in good standing under the laws of the state of
its incorporation. Each Debtor has the corporate power and authority to execute,
deliver, and perform this Agreement, and the execution, delivery, and
performance of this Agreement by such Debtor (a) have been authorized by all
necessary corporate action on the part of such Debtor, (b) do not and will not
violate (i) any law, rule or regulation which violation would have a material
adverse effect on the business, condition (financial or otherwise), operations,
prospects, or properties of such Debtor, the Collateral taken as a whole, or the
ability of the Companies to pay and perform the Obligations, or (ii) the
certificate of incorporation or bylaws of such Debtor, and (c) do not and will
not conflict with, result in a breach of, or constitute a default under the
provisions of any material indenture, mortgage, deed of trust, security
agreement, instrument, or agreement pursuant to which such Debtor or any of its
property is bound.
Section 2.5 PRINCIPAL PLACE OF BUSINESS. The principal place of business
and chief executive office of each Debtor, and the office where each Debtor
keeps its books and records, is located at the address of such Debtor shown
below its name on the signature pages of this Agreement.
Section 2.6 LOCATION OF COLLATERAL. All inventory, machinery, and
equipment (other than inventory, machinery and equipment, which individually or
in the aggregate is immaterial)
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 4
of each Debtor are located at the locations specified on Schedule 1 hereto, or
at other locations within the continental United States of America in the
ordinary course of each Debtor's business so long as all actions have been taken
to assure the continued perfection and priority of the Agent's security interest
therein.
ARTICLE III
COVENANTS
The Debtors jointly and severally covenant and agree with the Agent, the
Documentation Agent, the Banks and the Issuing Banks that until the Obligations
are paid and performed in full and all Commitments of the Banks and the Issuing
Banks to the Borrowers have been terminated:
Section 3.1 MAINTENANCE. Each Debtor shall maintain the Collateral in good
operating condition and repair, and no Debtor shall permit any waste or
destruction of the Collateral or any part thereof except for the ordinary wear
and tear of its intended primary use. No Debtor shall use or permit the
Collateral to be used in violation of any law or inconsistently with the terms
of any policy of insurance. No Debtor shall use or permit the Collateral to be
used in any manner or for any purpose that would impair the value of the
Collateral or expose the Collateral to unusual risk.
Section 3.2 ENCUMBRANCES. No Debtor shall create, permit, or suffer to
exist, and each Debtor shall defend the Collateral against, any Lien on the
Collateral except Permitted Liens, and each Debtor shall defend such Debtor's
rights in the Collateral and the Agent's security interest in the Collateral
against the claims of all Persons.
Section 3.3 MODIFICATION OF COLLATERAL. No Debtor shall do anything to
impair the rights of the Agent in the Collateral. Without the prior written
consent of the Agent, no Debtor shall (a) grant any extension of time for any
payment with respect to the Collateral, (b) compromise, compound, or settle any
of the Collateral, (c) release in whole or in part any person or entity liable
for payment with respect to the Collateral, (d) allow any credit or discount for
payment with respect to the Collateral other than normal trade discounts granted
in the ordinary course of business and other adjustments, such as bad debt
expense, made in the ordinary course of business, (e) release any lien, security
interest or assignment securing the Collateral, or (f) otherwise amend or modify
any of the Collateral.
Section 3.4 DISPOSITION OF COLLATERAL. No Debtor shall sell, lease, or
otherwise dispose of the Collateral or any part thereof without the prior
written consent of the Agent, except the Debtors may sell inventory in the
ordinary course of business and may dispose of obsolete items of equipment in
the ordinary course of business.
Section 3.5 FURTHER ASSURANCES. At any time and from time to time, upon
the request of the Agent, and at the sole expense of the Debtors, each Debtor
shall promptly execute and deliver all such further instruments and documents
and take such further action as the Agent may deem necessary or desirable to
preserve and perfect its security interest in the Collateral and carry
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 5
out the provisions and purposes of this Agreement, including, without
limitation, the execution and filing of such financing statements as the Agent
may require. A carbon, photographic, or other reproduction of this Agreement or
of any financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement and may be filed as a financing statement.
Each Debtor shall promptly endorse and deliver to the Agent all documents,
instruments, and chattel paper that it now owns or may hereafter acquire.
Section 3.6 RISK OF LOSS; INSURANCE. The Debtors shall be responsible for
any loss of or damage to the Collateral. Each Debtor shall maintain, with
financially sound and reputable companies, insurance policies (i) insuring the
Collateral against loss by fire, explosion, theft, and such other risks and
casualties as are customarily insured against by companies engaged in the same
or a similar business, and (ii) insuring such Debtor and the Agent against
liability for personal injury and property damage relating to the Collateral,
such policies to be in such amounts and covering such risks as are customarily
insured against by companies engaged in the same or a similar business, but at
least in the amounts specified in the Credit Agreement, with losses payable to
such Debtor and the Agent as their respective interests may appear. All
insurance with respect to the Collateral shall provide that no cancellation,
reduction in amount, or change in coverage thereof shall be effective unless the
Agent has received thirty (30) days prior written notice thereof. Each Debtor
shall furnish the Agent with certificates or other evidence satisfactory to the
Agent of compliance with the foregoing insurance provisions. Each Debtor shall
deliver to the Agent upon demand copies of all insurance policies covering the
Collateral or any part thereof.
Section 3.7 INSPECTION RIGHTS. Each Debtor shall permit the Agent, the
Documentation Agent, the Banks and the Issuing Banks and their representatives,
upon one (1) Business Day's prior notice, to examine or inspect the Collateral
wherever located and to examine, inspect, and copy such Debtor's books and
records at any reasonable time and as often as they may desire. The Agent may at
any time and from time to time contact account debtors and other obligors to
verify the existence, amounts, and terms of any Debtor's accounts.
Section 3.8 MORTGAGEE'S AND LANDLORD WAIVERS. The Debtors shall deliver to
the Agent an instrument satisfactory in form and substance to the Agent,
executed by the landlord of the premises located at ββββ βββββ βββββββ
ββββββββββ, βββββ β-ββββ, ββββββ, βββββ βββββ, by which such landlord waives or
subordinates its rights, if any, in the Collateral. With respect to all other
locations of Collateral, upon the request of the Agent at any time, each Debtor
shall exert its best efforts to cause each mortgagee of real property owned by
such Debtor and each landlord of real property leased by such Debtor to execute
and deliver instruments satisfactory in form and substance to the Agent by which
such mortgagee or landlord waives or subordinates its rights, if any, in the
Collateral.
Section 3.9 NOTIFICATION. Each Debtor shall promptly notify the Agent of
(i) any Lien or material claim made or threatened against the Collateral, (ii)
any material change in the Collateral, including, without limitation, any
material damage to or loss of the Collateral, and (iii) the occurrence or
existence of any Default.
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 6
Section 3.10 CORPORATE CHANGES. No Debtor shall change its name, identity,
or corporate structure in any manner that might make any financing statement
filed in connection with this Agreement seriously misleading, unless such Debtor
shall have given the Agent thirty (30) days prior written notice thereof and
shall have taken all action deemed necessary or desirable by the Agent to make
each financing statement not seriously misleading. No Debtor shall change its
principal place of business, chief executive office, or the place where it keeps
its books and records, unless it shall have given the Agent thirty (30) days
prior written notice thereof and shall have taken all action deemed necessary or
desirable by the Agent to cause its security interest in the Collateral to be
perfected with the priority required by this Agreement.
Section 3.11 BOOKS AND RECORDS; INFORMATION. Each Debtor shall keep
accurate and complete books and records of the Collateral and such Debtor's
business and financial condition in accordance with GAAP (subject to year-end
adjustments and disclosures). Each Debtor shall from time to time at the request
of the Agent deliver to the Agent such information regarding the Collateral and
such Debtor as the Agent may request, including, without limitation, lists and
descriptions of the Collateral and evidence of the identity and existence of the
Collateral. Each Debtor shall ββββ its books and records to reflect the security
interest of the Agent under this Agreement.
Section 3.12 LOCATION OF COLLATERAL. No Debtor shall move any of its
equipment, machinery or inventory from the locations specified herein without
the prior written consent of the Agent, except to other locations within the
continental United States of America in the ordinary course of business so long
as all actions have been taken to assure the continued perfection and priority
of the Agent's security interest therein.
Section 3.13 LOCKBOX ACCOUNTS. Each Debtor hereby agrees to the terms,
provisions and covenants set forth in Section 7.2 of the Credit Agreement and
the rights of the Agent thereunder, and hereby agrees to comply with each of the
requirements specified therein.
ARTICLE IV
RIGHTS OF THE AGENT
Section 4.1 CERTAIN COVENANTS AND RIGHTS REGARDING THE COLLATERAL.
(a) Each Debtor shall from time to time at the request of the Agent
furnish the Agent with a schedule of each account included in the
Collateral and a list of all those liable on checks, notes, drafts, and
other instruments representing the proceeds of such accounts. The Agent
shall have the right to make test verifications of the Collateral. If any
part of the Collateral is or becomes subject to the Federal Assignment of
Claims Act, the Debtor whose Collateral has been affected thereby will
execute all instruments and take all steps required by the Agent to comply
with that act. If part of the Collateral is evidenced by promissory notes,
trade acceptances or other instruments for the payment of money, each
Debtor will, at the request of the Agent, immediately deliver them to the
Agent, appropriately endorsed to the order of the Agent, and regardless of
the form of
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 7
endorsement, such Debtor waives presentment, demand, notice of dishonor,
protest, and notice of protest.
(b) If the validity or priority of this Agreement or of any rights,
titles, security interests or other interests created or evidenced hereby
shall be attacked, endangered, or questioned, or if any legal proceedings
are instituted with respect thereto, each Debtor will give prompt written
notice thereof to the Agent and, at the Debtors' own cost and expense,
will diligently endeavor to cure any defect which may be developed or
claimed, and will take all necessary and proper steps for the defense of
such legal proceedings, and the Agent (whether or not named as a party to
the legal proceedings with respect thereto) is hereby authorized and
empowered to take such additional steps as in its judgment and discretion
may be necessary or proper for the defense of any such legal proceedings
or the protection of the validity or priority of this Agreement and the
rights, titles, security interests, and other interests created or
evidenced hereby, and all expenses so incurred of every kind and character
shall be a demand obligation owing by the Debtors and the party incurring
such expenses shall be subrogated to all rights of the Person receiving
such payment.
(c) Upon the occurrence of an Event of Default, or if the Agent
shall deem payment of the Obligations to be insecure, and at any time
thereafter, the Agent is authorized to take possession peaceably of the
Collateral and of all books, records and accounts relating thereto, and to
exercise without interference from the Debtors any and all rights which
either Debtor has with respect to the management, possession, protection,
or preservation of the Collateral. If necessary to obtain the possession
provided for above, the Agent may invoke any and all legal remedies to
dispossess either Debtor, including specifically one or more actions for
forcible entry and detainer. In connection with any action taken by the
Agent pursuant to this Section, the Agent shall not be liable for any loss
sustained by either Debtor resulting from any act or omission of the Agent
unless such loss is caused by the willful misconduct and bad faith of the
Agent, nor shall the Agent be obligated to perform or discharge any
obligation, duty, or liability under any sale or lease agreement covering
the Collateral or any part thereof, or under or by reason of this
Agreement or exercise of rights or remedies hereunder.
(d) At any time prior to the termination of this Agreement the Agent
may notify the account debtors or obligors of any accounts, chattel paper,
negotiable instruments, or other evidences of indebtedness included in the
Collateral to pay the Agent directly. Until the Agent elects to exercise
these rights, each Debtor is authorized as agent of the Agent to collect
and enforce such accounts. The costs of collection and enforcement,
including attorneys' fees and expenses, shall be borne solely by the
Debtors whether incurred by the Agent or the Debtors.
Section 4.2 PERFORMANCE BY THE AGENT. If either of the Debtors fails to
perform or comply with any of its obligations and responsibilities contained
herein, the Agent itself may, at its sole discretion, cause or attempt to cause
performance or compliance with such agreement, the expenses of the Agent,
together with interest thereon at the Default Rate, shall be payable by
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 8
the Debtors to the Agent on demand and shall constitute Obligations secured by
this Agreement. The Agent, upon making such payment, shall be subrogated to all
of the rights of the Person receiving such payment. Notwithstanding the
foregoing, it is expressly agreed that the Agent shall not have any liability or
responsibility for the performance of any obligation of either Debtor under this
Agreement.
Section 4.3 SETOFF; PROPERTY HELD BY THE AGENT. If an Event of Default
shall have occurred and be continuing, the Agent shall have the right to set off
and apply against the Obligations, at any time and without notice to either
Debtor, any and all deposits (general or special, time or demand, provisional or
final) or other sums at any time credited by or owing from the Agent to either
Debtor whether or not the Obligations are then due. As additional security for
the Obligations, each Debtor hereby grants the Agent a security interest in all
money, instruments, and other property of such Debtor now or hereafter held by
the Agent. In addition to the Agent's right of setoff and as further security
for the Obligations, each Debtor hereby grants the Agent a security interest in
all deposits (general or special, time or demand, provisional or final) and
other accounts of such Debtor now or hereafter deposited with or held by the
Agent and all other sums at any time credited by or owing from the Agent to such
Debtor. The rights and remedies of the Agent hereunder are in addition to other
rights and remedies (including, without limitation, other rights of setoff)
which the Agent may have.
Section 4.4 ASSIGNMENT BY THE AGENT. The Agent, the Documentation Agent,
the Banks and the Issuing Banks may from time to time assign the Obligations and
any portion thereof, and/or the Collateral and any portion thereof, and the
assignee shall be entitled to all of the rights and remedies of such Person
under this Agreement in relation thereto.
ARTICLE V
DEFAULT
Section 5.1 RIGHTS AND REMEDIES. Upon the occurrence of an Event of
Default, the Agent shall have the following rights and remedies:
(i) In addition to all other rights and remedies granted to the
Agent in this Agreement and in any other instrument or agreement securing,
evidencing, or relating to the Obligations or any part thereof, the Agent
shall have all of the rights and remedies of a secured party under the
Uniform Commercial Code as adopted by the State of Texas. Without limiting
the generality of the foregoing, the Agent may (A) without demand or
notice to either Debtor, collect, receive, or take possession of the
Collateral or any part thereof and for that purpose the Agent may enter
upon any premises on which the Collateral is located and remove the
Collateral therefrom or render it inoperable, and/or (B) sell, lease, or
otherwise dispose of the Collateral, or any part thereof, in one or more
parcels at public or private sale or sales, at the Agent's offices or
elsewhere, for cash, on credit, or for future delivery. Upon the request
of the Agent, each Debtor shall assemble the Collateral and make it
available to the Agent at any place designated by the Agent that is
reasonably convenient to such Debtor and the Agent. Each Debtor agrees
that the
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 9
Agent shall not be obligated to give more than ten (10) days prior written
notice of the time and place of any public sale or of the time after which
any private sale may take place and that such notice shall constitute
reasonable notice of such matters. Each Debtor shall be jointly and
severally liable for all expenses of retaking, holding, preparing for
sale, or the like, and all attorneys' fees, legal expenses, and all other
costs and expenses incurred by the Agent in connection with the collection
of the Obligations and the enforcement of the Agent's rights under this
Agreement. The Debtors shall remain liable for any deficiency if the
proceeds of any sale or disposition of the Collateral are insufficient to
pay the Obligations in full. Each Debtor waives all rights of marshalling
in respect of the Collateral.
(ii) The Agent may cause any or all of the Collateral held by it to
be transferred into the name of the Agent or the name or names of the
Agent's nominee or nominees.
Section 5.2 APPLICATION OF PROCEEDS OF SALE. The proceeds of any sale of
Collateral pursuant to Section 5.1 hereof, as well as any Collateral consisting
of cash, shall be applied by the Agent as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses incurred by the Agent in connection with such sale or otherwise
in connection with this Agreement or any of the Obligations, including,
but not limited to, all court costs and the reasonable fees and expenses
of its agents and one legal counsel, the repayment of all advances made
hereunder or under any other Loan Document by the Agent on behalf of
either Debtor and any other costs or expenses incurred in connection with
the exercise of any right or remedy hereunder;
SECOND, to the payment in full of all other Obligations that are
payable to the Agent or the Documentation Agent including, without
limitation, all expense reimbursements and indemnities;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses incurred by the Issuing Banks in connection with the Credit
Agreement, any Letter of Credit, or any of the Obligations, including, but
not limited to, all court costs and the reasonable fees and expenses of
their agents and one legal counsel;
FOURTH, to the payment in full of all other Obligations that are
payable to the Issuing Banks, including, without limitation, all Letter of
Credit disbursements and all accrued and unpaid interest thereon and all
Letter of Credit fees;
FIFTH, to the payment in full of the Obligations, pro rata among the
Banks in accordance with the amounts of the Loans held by them, or, if no
Loans shall be outstanding, in accordance with the amounts of their
Commitments;
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 10
SIXTH, if any Letter of Credit remains outstanding, the Agent, after
making the applications required by paragraphs "FIRST" through "FIFTH"
above, shall hold back and retain as Collateral for the Obligations an
amount equal to the aggregate face amounts of all outstanding Letters of
Credit; and
SEVENTH, provided that all of the Obligations have been paid and
performed in full and all Commitments and Letters of Credit have
terminated, to the Debtors, or their successors or assigns, or to
whomsoever may lawfully be entitled to the same, or as a court of
competent jurisdiction may otherwise direct.
Upon any sale of the Collateral by the Agent (including, without limitation, a
sale pursuant to any applicable Uniform Commercial Code or under a judicial
proceeding), the receipt of the Agent or of the officer making the sale shall be
a sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Agent or such
officer or be answerable in any way for the misapplication thereof.
ARTICLE VI
MISCELLANEOUS
Section 6.1 NO WAIVER; CUMULATIVE REMEDIES. No failure on the part of the
Agent to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power, or privilege under this Agreement shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, power,
or privilege under this Agreement preclude any other or further exercise thereof
or the exercise of any other right, power, or privilege. The rights and remedies
provided for in this Agreement are cumulative and not exclusive of any rights
and remedies provided by law.
Section 6.2 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the Debtors, the Agent, the Documentation Agent, the
Banks and the Issuing Banks and their respective heirs, successors, and assigns,
except that neither Debtor may assign any of its rights or obligations under
this Agreement without the prior written consent of the Agent. The provisions of
this Agreement shall apply to each Debtor, individually and collectively.
Section 6.3 AMENDMENT; ENTIRE AGREEMENT; CONTROLLING AGREEMENT. THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS EMBODY THE FINAL, ENTIRE AGREEMENT AMONG
THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS,
REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE
SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE
PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO. The
provisions of this Agreement may be amended or
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 11
waived only by an instrument in writing signed by the parties hereto. In the
event any term or provision of this Agreement expressly conflicts with any term
or provision of the Credit Agreement, the terms and provisions of the Credit
Agreement shall govern and control.
Section 6.4 NOTICES. All notices and other communications provided for in
this Agreement shall be given or made in writing and telecopied, mailed by
certified mail return receipt requested, or delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof; or, as to any party at such other address as shall be designated by such
party in a notice to the other party given in accordance with this Section.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telecopy, subject to
telephone confirmation of receipt, or when personally delivered or, in the case
of a mailed notice, when duly deposited in the mails, in each case given or
addressed as aforesaid.
Section 6.5 APPLICABLE LAW; VENUE; SERVICE OF PROCESS. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT
HAS BEEN ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IT SHALL BE PERFORMABLE FOR
ALL PURPOSES IN DALLAS COUNTY, TEXAS. ANY ACTION OR PROCEEDING AGAINST EITHER
DEBTOR UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER INSTRUMENT OR
AGREEMENT SECURING, EVIDENCING, OR RELATING TO THE OBLIGATIONS OR ANY PART
THEREOF MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT IN DALLAS COUNTY, TEXAS.
EACH DEBTOR HEREBY IRREVOCABLY (I) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF
SUCH COURTS, AND (II) WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN SUCH COURT OR THAT SUCH
COURT IS AN INCONVENIENT FORUM. EACH DEBTOR AGREES THAT SERVICE OF PROCESS UPON
IT MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, AT ITS
ADDRESS SPECIFIED OR DETERMINED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 6.4
OF THIS AGREEMENT. NOTHING IN THIS AGREEMENT OR ANY OTHER INSTRUMENT OR
AGREEMENT SECURING, EVIDENCING, OR RELATING TO THE OBLIGATIONS OR ANY PART
THEREOF SHALL AFFECT THE RIGHT OF THE AGENT TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE AGENT TO BRING ANY ACTION OR
PROCEEDING AGAINST EITHER DEBTOR OR WITH RESPECT TO ANY OF THE COLLATERAL IN ANY
STATE OR FEDERAL COURT IN ANY OTHER JURISDICTION. ANY ACTION OR PROCEEDING BY
EITHER DEBTOR AGAINST THE AGENT SHALL BE BROUGHT ONLY IN A COURT LOCATED IN
DALLAS COUNTY, TEXAS.
Section 6.6 HEADINGS. The headings, captions, and arrangements used in
this Agreement are for convenience only and shall not affect the interpretation
of this Agreement.
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 12
Section 6.7 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Agreement or in any certificate
delivered pursuant hereto shall survive the execution and delivery of this
Agreement, and no investigation by the Agent, the Documentation Agent, or any
Bank or Issuing Bank shall affect the representations and warranties or the
right of the Agent, the Documentation Agent, the Banks and the Issuing Banks to
rely upon them.
Section 6.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 6.9 WAIVER OF BOND. In the event the Agent seeks to take
possession of any or all of the Collateral by judicial process, each Debtor
hereby irrevocably waives any bonds and any surety or security relating thereto
that may be required by applicable law as an incident to such possession, and
waives any demand for possession prior to the commencement of any such suit or
action.
Section 6.10 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 6.11 CONSTRUCTION. Each Debtor and the Agent acknowledge that each
of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement with its legal counsel and that
this Agreement shall be construed as if jointly drafted by the Debtors and the
Agent.
Section 6.12 OBLIGATIONS ABSOLUTE. The obligations of each Debtor under
this Agreement shall be absolute and unconditional and shall not be released,
discharged, reduced, or in any way impaired by any circumstance whatsoever,
including, without limitation, any amendment, modification, extension, or
renewal of this Agreement, the Obligations, or any document or instrument
evidencing, securing, or otherwise relating to the Obligations, or any release
or subordination of collateral, or any waiver, consent, extension, indulgence,
compromise, settlement, or other action or inaction in respect of this
Agreement, the Obligations, or any document or instrument evidencing, securing,
or otherwise relating to the Obligations, or any exercise or failure to exercise
any right, remedy, power, or privilege in respect of the Obligations.
Section 6.13 RELEASE OF SECURITY INTEREST. At such time as all of the
Obligations have been paid and performed in full, all obligations and
commitments of the Banks and the Issuing Banks to make advances, issue letters
of credit or otherwise extend credit under the Credit Agreement have expired or
terminated, and no Letters of Credit remain outstanding, the Agent shall release
the security interest granted hereby.
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 13
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first written above.
DEBTORS:
HEALTHCOR, INC.
HEALTHCOR HOLDINGS, INC.
By:S. βββββ ββββββ
Chairman of the Board of each of the
Debtors
Address for Notices:
ββββ βββββ βββββββ ββββββββββ, βββββ β-ββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: S. βββββ ββββββ
AGENT:
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION,
as Agent
By:ββββββ β. ββββββββ
Vice President
Address for Notices:
ββββ ββββ ββββββ
ββββ ββββββ βββ ββββββ
ββββββ, βββββ βββββ-ββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββββββ β. ββββββββ
AMENDED AND RESTATED BORROWER SECURITY AGREEMENT - Page 14
SCHEDULE 1
LOCATIONS OF COLLATERAL
EXHIBIT "D-2"
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT
This AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT (this
"Agreement") dated as of October 31, 1996 is by and among the undersigned
debtors (each, a "Debtor" and collectively, the "Debtors") and TEXAS COMMERCE
BANK NATIONAL ASSOCIATION, a national banking association, as agent (in such
capacity, together with its successors and assigns in such capacity, the
"Agent") for itself, the Documentation Agent (hereinafter defined), the Issuing
Banks (hereinafter defined) and the Banks (hereinafter defined).
R E C I T A L S:
A. HealthCor, Inc., a Delaware corporation ("HealthCor"), HealthCor
Holdings, Inc., a Delaware corporation ("Holdings", and together with HealthCor,
the "Borrowers"), the Agent, certain lenders (collectively, the "Existing
Banks"), and the Existing Banks issuing letters of credit thereunder (in such
capacity, the "Existing Issuing Banks") previously entered into that certain
Credit Agreement dated as of May 16, 1996 (as amended, the "Existing Credit
Agreement").
B. Pursuant to the Existing Credit Agreement, each of the Debtors executed
and delivered to the Agent a Security Agreement dated as of May 16, 1996, which
secured the obligations of the Borrowers under the Existing Credit Agreement
(collectively, the "Existing Security Agreements").
C. Concurrently herewith the Borrowers, the Agent, The First National Bank
of Chicago, a national banking association, as documentation agent (in such
capacity, the "Documentation Agent"), certain lenders (together with any other
lenders that may from time to time become a party thereto, the "Banks"), and the
Banks issuing letters of credit thereunder (in such capacity, the "Issuing
Banks") are entering into that certain Amended and Restated Credit Agreement of
even date herewith (as the same may be amended, supplemented or modified from
time to time, being hereinafter referred to as the "Credit Agreement").
D. The parties hereto now desire to amend and restate the Existing
Security Agreements, as hereinafter provided, and have agreed, for purposes of
clarity and ease of administration, to carry out the agreed upon amendments by
amending the pertinent provisions of the Existing Security Agreements and then
consolidating and restating the Existing Security Agreements, insofar as they
relate to property of the Debtors, in their entirety by means of this Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows and the Existing Security
Agreements are hereby amended, consolidated and restated in their entirety as
follows:
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 1
ARTICLE I
DEFINITIONS; SECURITY INTEREST
Section 1.1 DEFINITIONS. All capitalized terms used and not otherwise
defined herein shall have their respective meanings as set forth in the Credit
Agreement.
Section 1.2 SECURITY INTEREST. Each Debtor hereby grants to the Agent, for
the benefit of itself, the Documentation Agent, the Issuing Banks and the Banks,
and confirms that the Agent has previously been granted and now possesses a
security interest in the following property, whether now owned or existing or
hereafter acquired or arising and wherever arising or located (such property
being hereinafter sometimes called the "Collateral"):
(ACCOUNTS)
(a) All accounts, receivables, accounts receivable, general
intangibles, book debts, contract rights, instruments, and documents
(including, without limitation, all documents of title); (b) all chattel
paper, notes, drafts, acceptances, other evidences, and forms of payment
under leases of equipment or contracts for the sale of inventory or the
performance of services, and other forms of obligations received by or
belonging to such Debtor for goods sold or leased and/or services rendered
by such Debtor; (c) all of the rights of such Debtor in, to, and under all
purchase orders, sales contracts, instruments, and other documents
evidencing obligations for or representing payment for goods sold or
leased and/or services rendered by such Debtor; and (d) all moneys due or
to become due to such Debtor under all contracts for the sale or lease of
goods and/or the performance of services by such Debtor; in each case of
whatever nature, now owned by such Debtor or existing or hereafter
acquired, created, or arising and the rights and interests of such Debtor
in goods, the sale and delivery of which give rise to any and all proceeds
of any of the foregoing Collateral (including, but not limited to, all
insurance and claims for insurance in respect of the Collateral).
(INVENTORY)
All goods, merchandise, raw materials, goods in process, finished
goods, and other tangible personal property of whatever nature now owned
by such Debtor or hereafter from time to time existing or acquired, and
held for sale or lease or furnished or to be furnished under contracts of
service or used or usable or consumed or consumable in such Debtor's
business and all accessions and appurtenances thereto, and all accounts,
receivables, accounts receivables, instruments, notes, chattel paper,
documents (including, without limitation, all documents of title),
contract rights, and general intangibles arising in connection with any of
the foregoing and all products and proceeds of any of the foregoing
Collateral (including, without limitation, all insurance and claims for
insurance effective or held for the benefit of such Debtor or the Agent in
respect of any of the foregoing Collateral).
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 2
(EQUIPMENT)
All goods, equipment, machinery, furnishings, fixtures, furniture,
appliances, accessories, leasehold improvements, chattels, and other
articles of personal property of whatever nature now owned by such Debtor
or hereafter acquired, all accessions and appurtenances thereto, and all
renewals or replacements of or substitutions for any of the foregoing and
all proceeds of any of the foregoing Collateral (including, without
limitation, all insurance and claims for insurance in respect of any of
the foregoing Collateral).
Section 1.3 OBLIGATIONS. The Collateral shall secure the following
obligations, indebtedness, and liabilities (all such obligations, indebtedness,
and liabilities being hereinafter sometimes called the "Obligations"): (a) the
obligations, indebtedness, and liabilities of the Company to the Banks and the
Issuing Banks evidenced by the Revolving Credit Notes (herein so called)
executed by the Company pursuant to the Credit Agreement; (b) the obligations,
indebtedness, and liabilities of Holdings to the Banks evidenced by the
Acquisition Line Notes executed by Holdings pursuant to the Credit Agreement;
(c) the obligations, indebtedness, and liabilities of each Debtor to the Agent,
the Documentation Agent, the Issuing Banks and the Banks under that certain
Amended and Restated Subsidiary Guaranty of even date herewith, executed by such
Debtor in favor of the Agent, the Documentation Agent, the Issuing Banks and the
Banks pursuant to the Credit Agreement; (d) the obligations, indebtedness, and
liabilities of the Company and Holdings to the Agent, the Documentation Agent,
the Issuing Banks and the Banks under the Credit Agreement; (e) all future
advances by the Banks and the Issuing Banks to the Company, Holdings and any
Debtor, or any of them; (f) all costs and expenses, including without limitation
all attorneys' fees and legal expenses incurred by the Agent, the Documentation
Agent, the Issuing Banks and the Banks to preserve and maintain the Collateral,
collect the obligations herein described, and enforce this Agreement; (g) all
other Obligations (as such term is defined in the Credit Agreement); and (h) all
extensions, renewals, and modifications of any of the foregoing.
Section 1.4 RENEWAL OF OBLIGATIONS AND LIENS. The parties hereto
acknowledge and agree that (i) the Revolving Credit Notes and the initial
Acquisition Line Notes are in renewal, extension and modification, but not in
extinguishment of, the existing indebtedness of the Company and Holdings under
the Existing Credit Agreement, and (ii) such existing indebtedness is secured by
liens and security interests granted by the Debtors pursuant to the Existing
Security Agreements, which liens and security interests are not extinguished or
released, but instead are hereby renewed, extended, carried forward and
continued in accordance with the terms of this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
To induce the Agent to enter into this Agreement and to induce the Banks
and the Issuing Banks to extend credit to the Borrowers under the Credit
Agreement, each Debtor represents and warrants to the Agent, the Documentation
Agent, the Issuing Banks and the Banks that:
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 3
Section 2.1 TITLE. Except for the Permitted Liens, such Debtor owns, and
with respect to Collateral acquired after the date hereof such Debtor will own,
the Collateral free and clear of any Lien.
Section 2.2 ACCOUNTS. Each Debtor represents, warrants, and covenants that
each and all of its accounts will meet the following requirements continuously
from the time each of them comes into existence until it is collected in full:
(a) the account arose from the performance of services by such Debtor which
services have been fully and satisfactorily performed or from the absolute sale
of goods by such Debtor in which such Debtor had the sole and complete
ownership, and the goods have been shipped or delivered to the account debtor,
evidencing which such Debtor or the Agent has possession of shipping and
delivery receipts; (b) the account is not subject to setoff, counterclaim,
defense, allowance or adjustment other than discounts for prompt payment shown
on the invoice, or to dispute, objection or complaint by the account debtor
concerning his or its liability on the account, and the goods, the sale of which
gives rise to the account, have not been returned, rejected, lost, or damaged;
(c) the account arose in the ordinary course of such Debtor's business, and no
notice of bankruptcy, insolvency, or financial embarrassment of the account
debtor has been received by such Debtor; and (d) such Debtor shall notify the
Agent promptly in writing when any account ceases to meet any of the
requirements of this Agreement. Nothing in this Section shall be construed to
limit or release any right of the Agent and the Documentation Agent to any
Collateral arising pursuant to Section 1.2 of this Agreement.
Section 2.3 FINANCING STATEMENTS. No financing statement, security
agreement, or other lien instrument covering all or any part of the Collateral
is on file in any public office, except as may have been filed in favor of the
Agent or to perfect any Permitted Lien.
Section 2.4 ORGANIZATION AND AUTHORITY. Each Debtor is a corporation duly
organized, validly existing, and in good standing under the laws of the state of
its incorporation. Each Debtor has the corporate power and authority to execute,
deliver, and perform this Agreement, and the execution, delivery, and
performance of this Agreement by such Debtor (a) have been authorized by all
necessary corporate action on the part of such Debtor, (b) do not and will not
violate (i) any law, rule or regulation which violation would have a material
adverse effect on the business, condition (financial or otherwise), operations,
prospects, or properties of such Debtor, the Collateral taken as a whole, or the
ability of the Companies to pay and perform the Obligations, or (ii) the
articles or certificate of incorporation or bylaws of such Debtor, and (c) do
not and will not conflict with, result in a breach of, or constitute a default
under the provisions of any material indenture, mortgage, deed of trust,
security agreement, instrument or agreement pursuant to which such Debtor or any
of its property is bound.
Section 2.5 PRINCIPAL PLACE OF BUSINESS. The principal place of business
and chief executive office of each Debtor, and the office where each Debtor
keeps its books and records, is located at the address of such Debtor shown
below its name on the signature pages hereof.
Section 2.6 LOCATION OF COLLATERAL. All inventory, machinery, and
equipment (except for inventory, machinery and equipment which is not,
individually or in the aggregate, material in value or to the business of any
Debtor) of each Debtor are located at the locations specified on Schedule 1
hereto or at other locations within the continental United States of America in
the
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 4
ordinary course of each Debtor's business so long as all actions have been taken
to assure the continued perfection and priority of the Agent's security interest
therein.
ARTICLE III
COVENANTS
The Debtors jointly and severally covenant and agree with the Agent, the
Documentation Agent, the Issuing Banks and the Banks that until the Obligations
are paid and performed in full and all Commitments of the Banks and the Issuing
Banks to the Borrowers have been terminated:
Section 3.1 MAINTENANCE. Each Debtor shall maintain the Collateral in good
operating condition and repair, and no Debtor shall permit any waste or
destruction of the Collateral or any part thereof except for the ordinary wear
and tear of its intended primary use. No Debtor shall use or permit the
Collateral to be used in violation of any law or inconsistently with the terms
of any policy of insurance. No Debtor shall use or permit the Collateral to be
used in any manner or for any purpose that would impair the value of the
Collateral or expose the Collateral to unusual risk.
Section 3.2 ENCUMBRANCES. No Debtor shall create, permit, or suffer to
exist, and each Debtor shall defend the Collateral against, any Lien on the
Collateral except Permitted Liens, and shall defend such Debtor's rights in the
Collateral and the Agent's security interest in the Collateral against the
claims of all Persons.
Section 3.3 MODIFICATION OF COLLATERAL. No Debtor shall do anything to
impair the rights of the Agent in the Collateral. Without the prior written
consent of the Agent, no Debtor shall (a) grant any extension of time for any
payment with respect to the Collateral, (b) compromise, compound, or settle any
of the Collateral, (c) release in whole or in part any person or entity liable
for payment with respect to the Collateral, (d) allow any credit or discount for
payment with respect to the Collateral other than normal trade discounts granted
in the ordinary course of business and other adjustments, such as bad debt
expense, made in the ordinary course of business, (e) release any lien, security
interest, or assignment securing the Collateral, or (f) otherwise amend or
modify any of the Collateral.
Section 3.4 DISPOSITION OF COLLATERAL. No Debtor shall sell, lease, or
otherwise dispose of the Collateral or any part thereof without the prior
written consent of the Agent except the Debtors may sell inventory in the
ordinary course of business and may dispose of obsolete items of equipment in
the ordinary course of business.
Section 3.5 FURTHER ASSURANCES. At any time and from time to time, upon
the request of the Agent, and at the sole expense of the Debtors, each Debtor
shall promptly execute and deliver all such further instruments and documents
and take such further action as the Agent may deem necessary or desirable to
preserve and perfect its security interest in the Collateral and carry out the
provisions and purposes of this Agreement, including, without limitation, the
execution and filing of such financing statements as the Agent may require. A
carbon, photographic, or other reproduction of this Agreement or of any
financing statement covering the Collateral or any part thereof shall be
sufficient as a financing statement and may be filed as a financing statement.
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 5
Each Debtor shall promptly endorse and deliver to the Agent all documents,
instruments, and chattel paper that it now owns or may hereafter acquire.
Section 3.6 RISK OF LOSS; INSURANCE. The Debtors shall be responsible for
any loss of or damage to the Collateral. Each Debtor shall maintain, with
financially sound and reputable companies, insurance policies (i) insuring the
Collateral against loss by fire, explosion, theft, and such other risks and
casualties as are customarily insured against by companies engaged in the same
or a similar business, and (ii) insuring such Debtor and the Agent against
liability for personal injury and property damage relating to the Collateral,
such policies to be in such amounts and covering such risks as are customarily
insured against by companies engaged in the same or a similar business, but at
least in the amounts specified in the Credit Agreement, with losses payable to
such Debtor and the Agent, as their respective interests may appear. All
insurance with respect to the Collateral shall provide that no cancellation,
reduction in amount, or change in coverage thereof shall be effective unless the
Agent has received thirty (30) days prior written notice thereof. Each Debtor
shall furnish the Agent with certificates or other evidence satisfactory to the
Agent of compliance with the foregoing insurance provisions. Each Debtor shall
deliver to the Agent upon demand copies of all insurance policies covering the
Collateral or any part thereof.
Section 3.7 INSPECTION RIGHTS. Each Debtor shall permit the Agent, the
Documentation Agent, the Banks, the Issuing Banks and their representatives,
upon one (1) Business Day's prior notice, to examine or inspect the Collateral
wherever located and to examine, inspect, and copy such Debtor's books and
records at any reasonable time and as often as they may desire. The Agent may at
any time and from time to time contact account debtors and other obligors to
verify the existence, amounts, and terms of any Debtor's accounts.
Section 3.8 MORTGAGEE'S AND LANDLORD WAIVERS. The Debtors shall deliver to
the Agent an instrument satisfactory in form and substance to the Agent,
executed by the landlord of the premises located at ββββ βββββ βββββββ
ββββββββββ, βββββ β-ββββ, ββββββ, βββββ βββββ, by which such landlord waives or
subordinates its rights, if any, in the Collateral. With respect to all other
locations of Collateral, upon the request of the Agent at any time, each Debtor
shall exert its best efforts to cause each mortgagee of real property owned by
such Debtor and each landlord of real property leased by such Debtor to execute
and deliver instruments satisfactory in form and substance to the Agent by which
such mortgagee or landlord waives or subordinates its rights, if any, in the
Collateral.
Section 3.9 NOTIFICATION. Each Debtor shall promptly notify the Agent of
(i) any Lien or material claim made or threatened against the Collateral, (ii)
any material change in the Collateral, including, without limitation, any
material damage to or loss of the Collateral, and (iii) the occurrence or
existence of any Default.
Section 3.10 CORPORATE CHANGES. No Debtor shall change its name, identity,
or corporate structure in any manner that might make any financing statement
filed in connection with this Agreement seriously misleading, unless such Debtor
shall have given the Agent thirty (30) days prior written notice thereof and
shall have taken all action deemed necessary or desirable by the Agent to make
each financing statement not seriously misleading. No Debtor shall change its
principal place of business, chief executive office, or the place where it keeps
its books and
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 6
records, unless it shall have given the Agent thirty (30) days prior written
notice thereof and shall have taken all action deemed necessary or desirable by
the Agent to cause its security interest in the Collateral to be perfected with
the priority required by this Agreement.
Section 3.11 BOOKS AND RECORDS; INFORMATION. Each Debtor shall keep
accurate and complete books and records of the Collateral and such Debtor's
business and financial condition in accordance with GAAP (subject to year-end
adjustments and disclosures). Each Debtor shall from time to time at the request
of the Agent deliver to the Agent such information regarding the Collateral and
such Debtor as the Agent may request, including, without limitation, lists and
descriptions of the Collateral and evidence of the identity and existence of the
Collateral. Each Debtor shall ββββ its books and records to reflect the security
interest of the Agent under this Agreement.
Section 3.12 LOCATION OF COLLATERAL. No Debtor shall move any of its
equipment, machinery or inventory from the locations specified herein without
the prior written consent of the Agent, except to other locations within the
continental United States of America in the ordinary course of business so long
as all actions have been taken to assure the continued perfection and priority
of the Agent's security interest therein.
Section 3.13 LOCKBOX ACCOUNTS. Each Debtor hereby agrees to the terms,
provisions and covenants set forth in Section 7.2 of the Credit Agreement and
the rights of the Agent thereunder, and hereby agrees to comply with each of the
requirements specified therein.
ARTICLE IV
RIGHTS OF THE AGENT
Section 4.1 CERTAIN COVENANTS AND RIGHTS REGARDING THE COLLATERAL.
(a) Each Debtor shall from time to time at the request of the Agent
furnish the Agent with a schedule of each account included in the
Collateral and a list of all those liable on checks, notes, drafts, and
other instruments representing the proceeds of such accounts. The Agent
shall have the right to make test verifications of the Collateral. If any
part of the Collateral is or becomes subject to the Federal Assignment of
Claims Act, the Debtor whose Collateral has been affected thereby will
execute all instruments and take all steps required by the Agent to comply
with that act. If part of the Collateral is evidenced by promissory notes,
trade acceptances or other instruments for the payment of money, each
Debtor will, at the request of the Agent, immediately deliver them to the
Agent, appropriately endorsed to the Agent's order, and regardless of the
form of endorsement, such Debtor waives presentment, demand, notice of
dishonor, protest, and notice of protest.
(b) If the validity or priority of this Agreement or of any rights,
titles, security interests or other interests created or evidenced hereby
shall be attacked, endangered, or questioned, or if any legal proceedings
are instituted with respect thereto, each Debtor will give prompt written
notice thereof to the Agent and, at the Debtors' own cost and expense,
will diligently endeavor to cure any defect which may be developed or
claimed,
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 7
and will take all necessary and proper steps for the defense of such legal
proceedings, and the Agent (whether or not named as a party to the legal
proceedings with respect thereto) is hereby authorized and empowered to
take such additional steps as in its judgment and discretion may be
necessary or proper for the defense of any such legal proceedings or the
protection of the validity or priority of this Agreement and the rights,
titles, security interests, and other interests created or evidenced
hereby, and all expenses so incurred of every kind and character shall be
a demand obligation owing by the Debtors and the party incurring such
expenses shall be subrogated to all rights of the Person receiving such
payment.
(c) Upon the occurrence of an Event of Default, or if the Agent
shall deem payment of the Obligations to be insecure, and at any time
thereafter, the Agent is authorized to take possession peaceably of the
Collateral and of all books, records and accounts relating thereto, and to
exercise without interference from the Debtors any and all rights which
any such Debtor has with respect to the management, possession,
protection, or preservation of the Collateral. If necessary to obtain the
possession provided for above, the Agent may invoke any and all legal
remedies to dispossess any such Debtor, including specifically one or more
actions for forcible entry and detainer. In connection with any action
taken by the Agent pursuant to this Section, the Agent shall not be liable
for any loss sustained by any Debtor resulting from any act or omission of
the Agent unless such loss is caused by the willful misconduct and bad
faith of the Agent, nor shall the Agent be obligated to perform or
discharge any obligation, duty, or liability under any sale or lease
agreement covering the Collateral or any part thereof, or under or by
reason of this Agreement or exercise of rights or remedies hereunder.
(d) At any time prior to the termination of this Agreement the Agent
may notify the account debtors or obligors of any accounts, chattel paper,
negotiable instruments, or other evidences of indebtedness included in the
Collateral to pay the Agent directly. Until the Agent elects to exercise
these rights, each Debtor is authorized as agent of the Agent to collect
and enforce such accounts. The costs of collection and enforcement,
including attorneys' fees and expenses, shall be borne solely by the
Debtors whether incurred by the Agent or the Debtors.
Section 4.2 PERFORMANCE BY THE AGENT. If any of the Debtors fails to
perform or comply with any of its obligations or agreements contained herein,
the Agent itself may, at its sole discretion, cause or attempt to cause
performance or compliance with such agreement, the expenses of the Agent,
together with interest thereon at the Default Rate, shall be payable by the
Debtors to the Agent on demand and shall constitute Obligations secured by this
Agreement. The Agent, upon making such payment, shall be subrogated to all of
the rights of the Person receiving such payment. Notwithstanding the foregoing,
it is expressly agreed that the Agent shall not have any liability or
responsibility for the performance of any obligation of any Debtor under this
Agreement.
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 8
Section 4.3 SETOFF; PROPERTY HELD BY THE AGENT. If an Event of Default
shall have occurred and be continuing, the Agent shall have the right to set off
and apply against the Obligations, at any time and without notice to any Debtor,
any and all deposits (general or special, time or demand, provisional or final)
or other sums at any time credited by or owing from the Agent to any Debtor
whether or not the Obligations are then due. As additional security for the
Obligations, each Debtor hereby grants the Agent a security interest in all
money, instruments, and other property of such Debtor now or hereafter held by
the Agent. In addition to the Agent's right of setoff and as further security
for the Obligations, each Debtor hereby grants the Agent a security interest in
all deposits (general or special, time or demand, provisional or final) and
other accounts of such Debtor now or hereafter deposited with or held by the
Agent and all other sums at any time credited by or owing from the Agent to such
Debtor. The rights and remedies of the Agent hereunder are in addition to other
rights and remedies (including, without limitation, other rights of setoff)
which the Agent may have.
Section 4.4 ASSIGNMENT BY THE AGENT. The Agent, the Documentation Agent,
the Banks and the Issuing Banks may from time to time assign the Obligations and
any portion thereof, and/or the Collateral and any portion thereof, and the
assignee shall be entitled to all of the rights and remedies of such Person
under this Agreement in relation thereto.
ARTICLE V
DEFAULT
Section 5.1 RIGHTS AND REMEDIES. Upon the occurrence of an Event of
Default, the Agent shall have the following rights and remedies:
(i) In addition to all other rights and remedies granted to the
Agent in this Agreement and in any other instrument or agreement securing,
evidencing, or relating to the Obligations or any part thereof, the Agent
shall have all of the rights and remedies of a secured party under the
Uniform Commercial Code as adopted by the State of Texas. Without limiting
the generality of the foregoing, the Agent may (A) without demand or
notice to any Debtor, collect, receive, or take possession of the
Collateral or any part thereof and for that purpose the Agent may enter
upon any premises on which the Collateral is located and remove the
Collateral therefrom or render it inoperable, and/or (B) sell, lease, or
otherwise dispose of the Collateral, or any part thereof, in one or more
parcels at public or private sale or sales, at the Agent's offices or
elsewhere, for cash, on credit, or for future delivery. Upon the request
of the Agent, each Debtor shall assemble the Collateral and make it
available to the Agent at any place designated by the Agent that is
reasonably convenient to such Debtor and the Agent. Each Debtor agrees
that the Agent shall not be obligated to give more than ten (10) days
prior written notice of the time and place of any public sale or of the
time after which any private sale may take place and that such notice
shall constitute reasonable notice of such matters. Each Debtor
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 9
shall be jointly and severally liable for all expenses of retaking,
holding, preparing for sale, or the like, and all attorneys' fees, legal
expenses, and all other costs and expenses incurred by the Agent in
connection with the collection of the Obligations and the enforcement of
the Agent's rights under this Agreement. The Debtors shall remain liable
for any deficiency if the proceeds of any sale or disposition of the
Collateral are insufficient to pay the Obligations in full. Each Debtor
waives all rights of marshalling in respect of the Collateral.
(ii) The Agent may cause any or all of the Collateral held by it to
be transferred into the name of the Agent or the name or names of the
Agent's nominee or nominees.
Section 5.2 APPLICATION OF PROCEEDS OF SALE. The proceeds of any sale of
Collateral pursuant to Section 5.1 hereof, as well as any Collateral consisting
of cash, shall be applied by the Agent as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses incurred by the Agent in connection with such sale or otherwise
in connection with this Agreement or any of the Obligations, including,
but not limited to, all court costs and the reasonable fees and expenses
of its agents and one legal counsel, the repayment of all advances made
hereunder or under any other Loan Document by the Agent on behalf of any
Debtor and any other costs or expenses incurred in connection with the
exercise of any right or remedy hereunder;
SECOND, to the payment in full of all other Obligations that are
payable to the Agent or the Documentation Agent including, without
limitation, all expense reimbursements and indemnities;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses incurred by the Issuing Banks in connection with the Credit
Agreement, any Letter of Credit, or any of the Obligations, including, but
not limited to, all court costs and the reasonable fees and expenses of
their agents and one legal counsel;
FOURTH, to the payment in full of all other Obligations that are
payable to the Issuing Banks, including, without limitation, all Letter of
Credit disbursements and all accrued and unpaid interest thereon and all
Letter of Credit fees;
FIFTH, to the payment in full of the Obligations, pro rata among the
Banks in accordance with the amounts of the Loans held by them, or, if no
Loans shall be outstanding, in accordance with the amounts of their
Commitments;
SIXTH, if any Letter of Credit remains outstanding, the Agent, after
making the applications required by paragraphs "FIRST" through "FIFTH"
above,
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 10
shall hold back and retain as Collateral for the Obligations an amount
equal to the aggregate face amounts of all outstanding Letters of Credit;
and
SEVENTH, provided that all of the Obligations have been paid and
performed in full and all Commitments and Letters of Credit have
terminated, to the Debtors or their successors or assigns, or to
whomsoever may lawfully be entitled to the same, or as a court of
competent jurisdiction may otherwise direct.
Upon any sale of the Collateral by the Agent (including, without limitation, a
sale pursuant to any applicable Uniform Commercial Code or under a judicial
proceeding), the receipt of the Agent or of the officer making the sale shall be
a sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Agent or such
officer or be answerable in any way for the misapplication thereof.
ARTICLE VI
MISCELLANEOUS
Section 6.1 NO WAIVER; CUMULATIVE REMEDIES. No failure on the part of the
Agent to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power, or privilege under this Agreement shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, power,
or privilege under this Agreement preclude any other or further exercise thereof
or the exercise of any other right, power, or privilege. The rights and remedies
provided for in this Agreement are cumulative and not exclusive of any rights
and remedies provided by law.
Section 6.2 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the Debtors, the Agent, the Documentation Agent, the
Banks and the Issuing Banks and their respective heirs, successors, and assigns,
except that no Debtor may assign any of its rights or obligations under this
Agreement without the prior written consent of the Agent. The provisions of this
Agreement shall apply to each Debtor, individually and collectively.
Section 6.3 AMENDMENT; ENTIRE AGREEMENT; CONTROLLING AGREEMENT. THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS EMBODY THE FINAL, ENTIRE AGREEMENT AMONG
THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS,
REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE
SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE
PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO. The
provisions of this Agreement may be amended or
waived only by an instrument in writing signed by the parties hereto. In the
event any term or provision of this Agreement expressly conflicts with any term
or provision of the Credit Agreement, the terms and provisions of the Credit
Agreement shall govern and control.
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 11
Section 6.4 NOTICES. All notices and other communications provided for in
this Agreement shall be given or made in writing and telecopied, mailed by
certified mail return receipt requested, or delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof; or, as to any party at such other address as shall be designated by such
party in a notice to the other party given in accordance with this Section.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telecopy, subject to
telephone confirmation of receipt, or when personally delivered or, in the case
of a mailed notice, when duly deposited in the mails, in each case given or
addressed as aforesaid.
Section 6.5 APPLICABLE LAW; VENUE; SERVICE OF PROCESS. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT
HAS BEEN ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IT SHALL BE PERFORMABLE FOR
ALL PURPOSES IN DALLAS COUNTY, TEXAS. ANY ACTION OR PROCEEDING AGAINST ANY
DEBTOR UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER INSTRUMENT OR
AGREEMENT SECURING, EVIDENCING, OR RELATING TO THE OBLIGATIONS OR ANY PART
THEREOF MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT IN DALLAS COUNTY, TEXAS.
EACH DEBTOR HEREBY IRREVOCABLY (I) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF
SUCH COURTS, AND (II) WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN SUCH COURT OR THAT SUCH
COURT IS AN INCONVENIENT FORUM. EACH DEBTOR AGREES THAT SERVICE OF PROCESS UPON
IT MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, AT ITS
ADDRESS SPECIFIED OR DETERMINED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 6.4
OF THIS AGREEMENT. NOTHING IN THIS AGREEMENT OR ANY OTHER INSTRUMENT OR
AGREEMENT SECURING, EVIDENCING, OR RELATING TO THE OBLIGATIONS OR ANY PART
THEREOF SHALL AFFECT THE RIGHT OF THE AGENT TO SERVE PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF THE AGENT TO BRING ANY ACTION OR
PROCEEDING AGAINST ANY DEBTOR OR WITH RESPECT TO ANY OF THE COLLATERAL IN ANY
STATE OR FEDERAL COURT IN ANY OTHER JURISDICTION. ANY ACTION OR PROCEEDING BY
ANY DEBTOR AGAINST THE AGENT SHALL BE BROUGHT ONLY IN A COURT LOCATED IN DALLAS
COUNTY, TEXAS.
Section 6.6 HEADINGS. The headings, captions, and arrangements used in
this Agreement are for convenience only and shall not affect the interpretation
of this Agreement.
Section 6.7 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Agreement or in any certificate
delivered pursuant hereto shall survive the execution and delivery of this
Agreement, and no investigation by the Agent, the Documentation Agent, any Bank
or Issuing Bank shall affect the representations and warranties
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 12
of any Debtor herein or the right of the Agent, the Documentation Agent, the
Banks and the Issuing Banks to rely upon them.
Section 6.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 6.9 WAIVER OF BOND. In the event the Agent seeks to take
possession of any or all of the Collateral by judicial process, each Debtor
hereby irrevocably waives any bonds and any surety or security relating thereto
that may be required by applicable law as an incident to such possession, and
waives any demand for possession prior to the commencement of any such suit or
action.
Section 6.10 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 6.11 CONSTRUCTION. Each Debtor and the Agent acknowledge that each
of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement with its legal counsel and that
this Agreement shall be construed as if jointly drafted by the Debtors and the
Agent.
Section 6.12 OBLIGATIONS ABSOLUTE. The obligations of each Debtor under
this Agreement shall be absolute and unconditional and shall not be released,
discharged, reduced, or in any way impaired by any circumstance whatsoever,
including, without limitation, any amendment, modification, extension, or
renewal of this Agreement, the Obligations, or any document or instrument
evidencing, securing, or otherwise relating to the Obligations, or any release
or subordination of collateral, or any waiver, consent, extension, indulgence,
compromise, settlement, or other action or inaction in respect of this
Agreement, the Obligations, or any document or instrument evidencing, securing,
or otherwise relating to the Obligations, or any exercise or failure to exercise
any right, remedy, power, or privilege in respect of the Obligations.
Section 6.13 RELEASE OF SECURITY INTEREST. At such time as all of the
Obligations have been paid and performed in full, all obligations and
commitments of the Banks and the Issuing Banks to make advances, issue letters
of credit or otherwise extend credit under the Credit Agreement have expired or
terminated, and no Letters of Credit remain outstanding, the Agent shall release
the security interest granted hereby.
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 13
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first written above.
DEBTORS:
HEALTHCOR PHARMACY, INC.
HEALTHCOR OXYGEN AND MEDICAL
EQUIPMENT, INC.
PHYSICIANS HOME HEALTH NETWORK, INC.
HEALTHCOR REHABILITATION SERVICES,
INC.
HC PERSONNEL RESOURCES, INC.
By:
Name:
Title:
Address: ββββ βββββ βββββββ ββββββββββ
βββββ β-ββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Tel. No.: (βββ) βββ-ββββ
Attn: S. βββββ ββββββ
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 14
THE AGENT:
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION,
as Agent
By:ββββββ β. ββββββββ,
Vice President
Address: ββββ ββββ ββββββ
ββββ ββββββ βββ ββββββ
ββββββ, βββββ βββββ-ββββ
Fax No.: (βββ) βββ-ββββ
Tel. No.: (βββ) βββ-ββββ
Attn: ββββββ β. ββββββββ
AMENDED AND RESTATED SUBSIDIARY SECURITY AGREEMENT - Page 15
SCHEDULE 1
LOCATIONS OF COLLATERAL
SCHEDULE 1, Locations of Collateral
EXHIBIT "E-1"
AMENDED AND RESTATED SUBSIDIARY GUARANTY
AMENDED AND RESTATED SUBSIDIARY GUARANTY
This AMENDED AND RESTATED SUBSIDIARY GUARANTY (this "Guaranty"), executed
as of October 31, 1996 by the undersigned guarantors (each, a "Guarantor" and
collectively, the "Guarantors"), is a condition to the extension of credit in
the form of loans and letters of credit under the Credit Agreement (hereinafter
defined).
R E C I T A L S:
A. HealthCor, Inc., a Delaware corporation ("HealthCor"), HealthCor
Holdings, Inc., a Delaware corporation ("Holdings", and together with HealthCor,
the "Borrowers"), certain lenders (collectively, the "Existing Banks"), and the
Existing Banks issuing letters of credit thereunder (in such capacity, the
"Existing Issuing Banks") and Texas Commerce Bank National Association, a
national banking association, as agent for itself, the Existing Banks and the
Existing Issuing Banks (in such capacity, the "Agent") previously entered into
that certain Credit Agreement dated as of May 16, 1996 (as amended, the
"Existing Credit Agreement").
B. Pursuant to the Existing Credit Agreement, each of the Guarantors
executed and delivered to the Agent a Guaranty Agreement dated as of May 16,
1996, which secured the obligations of the Borrowers under the Existing Credit
Agreement (collectively, the "Existing Guaranty Agreements").
C. Concurrently herewith the Borrowers, the Agent, The First National Bank
of Chicago, a national banking association, as documentation agent (in such
capacity, the "Documentation Agent"), certain lenders (together with any other
lenders that may from time to time become a party thereto, the "Banks"), and the
Banks issuing letters of credit thereunder (in such capacity, the "Issuing
Banks") are entering into that certain Amended and Restated Credit Agreement of
even date herewith (as the same may be amended, supplemented or modified from
time to time, being hereinafter referred to as the "Credit Agreement").
D. The parties hereto now desire to amend and restate the Existing
Guaranty Agreements as hereinafter provided and have agreed, for purposes of
clarity and ease of administration, to carry out the agreed upon amendments by
amending the pertinent provisions of the Existing Guaranty Agreements and then
consolidating and restating the Existing Guaranty Agreements in their entirety
by means of this Agreement.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the Guarantors hereby jointly and severally, and
irrevocably and unconditionally, guarantee to the Agent, the Documentation
Agent, the Banks and the Issuing Banks the full and prompt payment and
performance of the Guaranteed Indebtedness (hereinafter defined) on the
following terms and the Existing Subsidiary Guaranties are hereby amended,
consolidated and restated in their entirety as follows:
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 1
1. The term "Guaranteed Indebtedness", as used herein, means all of the
"Obligations", as defined in the Credit Agreement. The term "Guaranteed
Indebtedness" shall include any and all post-petition interest and expenses
(including reasonable attorneys' fees) whether or not allowed under any
bankruptcy, insolvency, or other similar law. All other capitalized terms used
and not otherwise defined herein shall have their respective meanings as set
forth in the Credit Agreement.
2. The parties hereto acknowledge and agree that (i) the Revolving Credit
Notes and the initial Acquisition Line Notes renew, extend and modify, but do
not extinguish the existing indebtedness of the Borrowers under the Existing
Credit Agreement, and (ii) such existing indebtedness is guaranteed by the
Guarantors pursuant to the Existing Guaranty Agreements, which guaranties are
hereby amended, restated and consolidated in accordance with the terms of this
Guaranty.
3. This instrument shall be an absolute, continuing, irrevocable, and
unconditional guaranty of payment and performance, and not a guaranty of
collection, and each Guarantor shall remain liable on its obligations hereunder
until the payment and performance in full of the Guaranteed Indebtedness. No
set-off, counterclaim, recoupment, reduction, or diminution of any obligation,
or any defense of any kind or nature which either Borrower may have against the
Agent, the Documentation Agent, or any Bank or Issuing Bank, or any other party,
or which any Guarantor may have against either Borrower, the Agent, the
Documentation Agent, or any Bank or Issuing Bank, or any other party, shall be
available to, or shall be asserted by, any Guarantor against the Agent, the
Documentation Agent, or any Bank or Issuing Bank, or any subsequent holder of
the Guaranteed Indebtedness or any part thereof or against payment of the
Guaranteed Indebtedness or any part thereof.
4. The obligations of each Guarantor hereunder shall be limited to an
aggregate amount equal to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of the United
States Bankruptcy Code or to being set aside, avoided, or annulled under any
applicable state law relating to fraudulent transfers or fraudulent obligations.
5. If any Guarantor becomes liable for any indebtedness owing by either
Borrower to the Agent, the Documentation Agent, or any Bank or Issuing Bank by
endorsement or otherwise, other than under this Guaranty, such liability shall
not be in any manner impaired or affected hereby, and the rights of the Agent,
the Documentation Agent, the Banks and the Issuing Banks hereunder shall be
cumulative of any and all other rights that the Agent, the Documentation Agent,
the Banks and the Issuing Banks may ever have against any Guarantor. The
exercise by the Agent, the Documentation Agent, or any Bank or Issuing Bank of
any right or remedy hereunder or under any other instrument, or at law or in
equity, shall not preclude the concurrent or subsequent exercise of any other
right or remedy.
6. In the event of default by either Borrower in payment or performance of
the Guaranteed Indebtedness, or any part thereof, when such Guaranteed
Indebtedness becomes due, whether by its terms, by acceleration, or otherwise,
each Guarantor jointly and severally agrees
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 2
to promptly pay the amount due thereon to the Agent, for the pro rata benefit of
the Banks and the Issuing Banks, without notice or demand in lawful currency of
the United States of America and it shall not be necessary for the Agent, the
Documentation Agent, or any Bank or Issuing Bank, in order to enforce such
payment by any Guarantor, first to institute suit or exhaust its remedies
against either Borrower, any Guarantor or other Person liable on such Guaranteed
Indebtedness, or to enforce any rights against any collateral which shall ever
have been given to secure such Guaranteed Indebtedness. Notwithstanding anything
to the contrary contained in this Guaranty, each Guarantor hereby irrevocably
subordinates to the prior indefeasible payment in full of the Guaranteed
Indebtedness any and all rights such Guarantor may now or hereafter have under
any agreement or at law or in equity (including, without limitation, any law
subrogating such Guarantor to the rights of the Agent, the Documentation Agent,
the Banks and the Issuing Banks) to assert any claim against or seek
contribution, indemnification or any other form of reimbursement from either
Borrower or any other party liable for payment of any or all of the Guaranteed
Indebtedness pursuant to any payment made by such Guarantor under or in
connection with this Guaranty or otherwise.
7. If acceleration of the time for payment of any amount payable by either
Borrower under the Guaranteed Indebtedness is stayed upon the insolvency,
bankruptcy, or reorganization of either Borrower, all such amounts otherwise
subject to acceleration under the terms of the Guaranteed Indebtedness shall
nonetheless be jointly and severally payable by the Guarantors hereunder
forthwith on demand by the Agent.
8. Each Guarantor hereby agrees that its obligations under this Guaranty
shall not be released, discharged, diminished, impaired, reduced, or affected
for any reason or by the occurrence of any event, including, without limitation,
one or more of the following events, whether or not with notice to or the
consent of any Guarantor: (a) the taking or accepting of collateral as security
for any or all of the Guaranteed Indebtedness or the release, surrender,
exchange, or subordination of any collateral now or hereafter securing any or
all of the Guaranteed Indebtedness; (b) any partial release of the liability of
any Guarantor hereunder, or the full or partial release of any other guarantor
from liability for any or all of the Guaranteed Indebtedness; (c) any disability
of either Borrower, or the dissolution, insolvency, or bankruptcy of either
Borrower, any Guarantor, or any other party at any time liable for the payment
of any or all of the Guaranteed Indebtedness; (d) any renewal, extension,
modification, waiver, amendment, or rearrangement of any or all of the
Guaranteed Indebtedness or any instrument, document, or agreement evidencing,
securing, or otherwise relating to any or all of the Guaranteed Indebtedness;
(e) any adjustment, indulgence, forbearance, waiver, or compromise that may be
granted or given by the Agent, the Documentation Agent, or any Bank or Issuing
Bank to either Borrower, any Guarantor, or any other Person ever liable for any
or all of the Guaranteed Indebtedness; (f) any neglect, delay, omission,
failure, or refusal of the Agent, the Documentation Agent, or any Bank or
Issuing Bank to take or prosecute any action for the collection of any of the
Guaranteed Indebtedness or to foreclose or take or prosecute any action in
connection with any instrument, document, or agreement evidencing, securing, or
otherwise relating to any or all of the Guaranteed Indebtedness; (g) the
unenforceability or invalidity of any or all of the Guaranteed Indebtedness or
of any instrument, document, or agreement evidencing, securing, or otherwise
relating to any or all of the Guaranteed Indebtedness; (h) any payment by
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 3
either Borrower or any other party to the Agent, the Documentation Agent, or any
Bank or Issuing Bank is held to constitute a preference under applicable
bankruptcy or insolvency law or if for any other reason the Agent, the
Documentation Agent, or any Bank or Issuing Bank is required to refund any
payment or pay the amount thereof to someone else; (i) the settlement or
compromise of any of the Guaranteed Indebtedness; (j) the non-perfection of any
security interest or lien securing any or all of the Guaranteed Indebtedness;
(k) any impairment of any collateral securing any or all of the Guaranteed
Indebtedness; (l) the failure of the Agent, the Documentation Agent, or any Bank
or Issuing Bank to sell any collateral securing any or all of the Guaranteed
Indebtedness in a commercially reasonable manner or as otherwise required by
law; (m) any change in the corporate existence, structure or ownership of either
Borrower; or (n) any other circumstance which might otherwise constitute a
defense available to, or discharge of, either Borrower or any Guarantor.
9. Each Guarantor represents and warrants to the Agent, the Documentation
Agent, the Banks and the Issuing Banks that:
(a) All individual representations and warranties contained in the
Credit Agreement, to the extent that they relate to the Guarantors, are
true and correct in all respects.
(b) The value of the consideration received and to be received by
such Guarantor as a result of the Borrowers, the Banks, the Issuing Banks,
the Documentation Agent and the Agent entering into the Credit Agreement,
the extensions of credit thereunder, and such Guarantor executing and
delivering this Guaranty is reasonably equivalent to or greater than the
liability and obligation of such Guarantor hereunder, and such liability
and obligation, the Borrower's entering into the Credit Agreement, and the
extensions of credit thereunder have benefited and may reasonably be
expected to benefit such Guarantor directly or indirectly.
(c) Such Guarantor has, independently and without reliance upon the
Agent, the Documentation Agent, or any Bank or Issuing Bank and based upon
such documents and information as such Guarantor has deemed appropriate,
made its own analysis and decision to enter into this Guaranty.
(d) The ability of the Borrowers to borrow and obtain letters of
credit from time to time under the Credit Agreement will enable such
Guarantor to obtain credit, will benefit such Guarantor and the
consolidated corporate group of which such Guarantor is a part and is
necessary and convenient to the conduct, promotion and attainment of the
business of such Guarantor.
(e) As additional consideration for entering into this Guaranty,
such Guarantor has obtained certain rights under that certain Contribution
and Indemnification Agreement of even date herewith, among such Guarantor
and the other Companies.
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 4
(f) Such Guarantor has adequate capital to conduct its business as a
going concern, as presently conducted and as proposed to be conducted;
such Guarantor will be able to meet its obligations hereunder and in
respect of its other existing and future indebtedness and liabilities as
and when the same shall be due and payable; such Guarantor is not
insolvent (as that term is defined in 11 U.S.C. ss. 101 or under other
applicable law) and will not be rendered insolvent by its obligations
hereunder, and the foregoing representations are supported by such
Guarantor's internal projections and forecasts.
(g) Such Guarantor has determined that the execution and delivery of
this Guaranty is to its advantage and benefit, taking into account all
relevant facts and circumstances.
10. Each Guarantor covenants and agrees that, as long as the Guaranteed
Indebtedness or any part thereof is outstanding or any Bank or Issuing Bank has
any commitment under the Credit Agreement:
(a) Such Guarantor will furnish promptly to the Agent written notice
of the occurrence of any default under this Guaranty or any Default under
the Credit Agreement.
(b) Such Guarantor will furnish promptly to the Agent such
additional information concerning such Guarantor as the Agent, the
Documentation Agent, any Bank or Issuing Bank may reasonably request.
(c) Such Guarantor will obtain at any time and from time to time all
authorizations, licenses, consents or approvals as shall now or hereafter
be necessary or desirable under all applicable laws or regulations to
conduct its business substantially as now conducted and as presently
proposed to be conducted or otherwise in connection with the execution,
delivery and performance of this Guaranty and will promptly furnish copies
thereof to the Agent.
11. If an Event of Default shall have occurred and be continuing, the
Agent, the Documentation Agent, the Banks and the Issuing Banks shall each have
the right to set off and apply against this Guaranty or the Guaranteed
Indebtedness or both, at any time and without notice to any Guarantor, any and
all deposits (general or special, time or demand, provisional or final) or other
sums at any time credited by or owing from the Agent, the Documentation Agent,
or any Bank or Issuing Bank to any Guarantor whether or not the Guaranteed
Indebtedness is then due and irrespective of whether or not the Agent, the
Documentation Agent, or any Bank or Issuing Bank shall have made any demand
under this Guaranty. As security for this Guaranty and the Guaranteed
Indebtedness, each Guarantor hereby grants the Agent, the Documentation Agent,
the Banks and the Issuing Banks a security interest in all money, instruments,
certificates of deposit, and other property of such Guarantor now or hereafter
held by the Agent, the Documentation Agent, or any Bank or Issuing Bank,
including, without limitation, property held in safekeeping. In addition to the
rights of setoff of the Agent, the Documentation Agent, the Banks and the
Issuing Banks and as further security for this Guaranty and the Guaranteed
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 5
Indebtedness, each Guarantor hereby grants the Agent, the Documentation Agent,
the Banks and the Issuing Banks a security interest in all deposits (general or
special, time or demand, provisional or final) and all other accounts of such
Guarantor now or hereafter on deposit with or held by the Agent, the
Documentation Agent, or any Bank or Issuing Bank and all other sums at any time
credited by or owing from the Agent, the Documentation Agent, or any Bank or
Issuing Bank to such Guarantor. The rights and remedies of the Agent, the
Documentation Agent, the Banks and the Issuing Banks hereunder are in addition
to other rights and remedies (including, without limitation, other rights of
setoff) which the Agent, the Documentation Agent, the Banks and the Issuing
Banks may have.
12. (a) Each Guarantor hereby agrees that the Subordinated Indebtedness
(hereinafter defined) shall be subordinate and junior in right of payment to the
prior payment in full of all Guaranteed Indebtedness, and each Guarantor hereby
assigns the Subordinated Indebtedness to the Agent, for the pro rata benefit of
the Banks and the Issuing Banks, as security for the Guaranteed Indebtedness. If
any sums shall be paid to any Guarantor by either Borrower or any other Person
on account of the Subordinated Indebtedness, such sums shall be held in trust by
such Guarantor for the benefit of the Agent and shall forthwith be paid to the
Agent, for the pro rata benefit of the Banks and the Issuing Banks, without
affecting the liability of any Guarantor under this Guaranty and may be applied
by the Agent, the Documentation Agent, the Banks and the Issuing Banks against
the Guaranteed Indebtedness in such order and manner as they may determine in
their absolute discretion; provided, however, that so long as no Event of
Default shall have occurred, either Borrower shall be permitted to pay to any
Guarantor, and each Guarantor shall be permitted to receive and retain, payments
on account of Subordinated Indebtedness consisting of trade payables owing by
either Borrower to any Guarantor. Upon the request of the Agent, each Guarantor
shall execute, deliver, and endorse to the Agent, for the pro rata benefit of
the Banks and the Issuing Banks, such documents and instruments as the Agent may
request to perfect, preserve and enforce the rights of the Agent, the Banks and
the Issuing Banks hereunder. For purposes of this Guaranty, the term
"Subordinated Indebtedness" means all indebtedness, liabilities and obligations
of the Borrowers and the Subsidiaries, or any of them, to any Guarantor, whether
such indebtedness, liabilities, and obligations now exist or are hereafter
incurred or arise, or whether the obligations of either Borrower or any
Subsidiary thereon are direct, indirect, contingent, primary, secondary,
several, joint, joint and several, or otherwise, and irrespective of whether
such indebtedness, liabilities or obligations are evidenced by a note, contract,
open account or otherwise, and irrespective of the Person or Persons in whose
favor such indebtedness, obligations or liabilities may, at their inception,
have been, or may hereafter be, created, or the manner in which they have been
or may hereafter be acquired by any Guarantor.
(b) Each Guarantor agrees that any and all liens, security
interests, judgment liens, charges, or other encumbrances upon the assets of the
Borrowers and the Subsidiaries, or any of them, securing payment of any
Subordinated Indebtedness shall be and remain inferior and subordinate to any
and all liens, security interests, judgment liens, charges or other encumbrances
upon such assets securing payment of the Guaranteed Indebtedness or any part
thereof, regardless of whether such encumbrances in favor of any Guarantor or
the Agent presently exist or are hereafter created or attached. No Guarantor
shall (i) file suit against either Borrower or any
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 6
Subsidiary or exercise or enforce any other creditor's right it may have against
either Borrower or any Subsidiary, or (ii) foreclose, repossess, sequester, or
otherwise take steps or institute any action or proceedings (judicial or
otherwise, including without limitation the commencement of, or joinder in, any
liquidation, bankruptcy, rearrangement, debtor's relief or insolvency
proceeding) to enforce any liens, security interests, collateral rights,
judgments or other encumbrances held by any Guarantor on assets of either
Borrower or any other Company unless and until the Guaranteed Indebtedness shall
have been paid in full, no Letters of Credit are outstanding, and the
Commitments have expired or terminated.
(c) In the event of any receivership, bankruptcy, reorganization,
rearrangement, debtor's relief, or other insolvency proceeding involving either
Borrower or any Subsidiary as debtor, the Agent shall have the right to prove
and vote any claim under the Subordinated Indebtedness and to receive, for the
benefit of the Banks and the Issuing Banks, directly from the receiver, trustee
or other court custodian, all dividends, distributions and payments made in
respect of the Subordinated Indebtedness. The Agent, the Documentation Agent,
the Banks and the Issuing Banks may apply any such dividends, distributions and
payments against the Guaranteed Indebtedness in such order and manner as they
may determine in their absolute discretion.
(d) Each Guarantor agrees that all promissory notes, accounts
receivable, ledgers, records or any other evidence of Subordinated Indebtedness
shall contain a specific written notice thereon that the indebtedness evidenced
thereby is subordinated under the terms of this Guaranty.
13. No Guarantor shall prepay any of its debts or obligations, except the
Guaranteed Indebtedness.
14. No amendment or waiver of any provision of this Guaranty or consent to
any departure by any Guarantor therefrom shall in any event be effective unless
the same shall be in writing and signed by the Agent and the Required Banks. No
failure on the part of the Agent, the Documentation Agent, or any Bank or
Issuing Bank to exercise, and no delay in exercising, any right, power, or
privilege hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power, or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, power, or
privilege. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
15. Any acknowledgment or new promise, whether by payment of principal or
interest or otherwise and whether by either Borrower or other Person, including
any Guarantor, with respect to any of the Guaranteed Indebtedness shall, if the
statute of limitations in favor of any Guarantor against the Agent, the
Documentation Agent, the Banks or the Issuing Banks shall have commenced to run,
toll the running of such statute of limitations and, if the period of such
statute of limitations shall have expired, prevent the operation of such statute
of limitations.
16. This Guaranty is for the benefit of the Agent, the Documentation
Agent, the Banks and the Issuing Banks, and their respective successors and
assigns, and in the event of an
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 7
assignment of the Guaranteed Indebtedness, or any part thereof, the rights and
benefits hereunder, to the extent applicable to the indebtedness so assigned,
may be transferred with such indebtedness. This Guaranty is binding not only on
each Guarantor, but on each Guarantor's successors and assigns. The Guarantors'
obligations and agreements hereunder are joint and several. The provisions of
this Guaranty shall apply to each Guarantor individually and collectively.
17. Each Guarantor recognizes that the Agent, the Documentation Agent, the
Banks and the Issuing Banks are relying upon this Guaranty and the undertakings
of each Guarantor hereunder in making extensions of credit to the Borrowers
under the Credit Agreement and further recognizes that the execution and
delivery of this Guaranty is a material inducement to the Agent, the
Documentation Agent, the Banks and the Issuing Banks in entering into the Credit
Agreement. Each Guarantor hereby acknowledges that there are no conditions to
the full effectiveness of this Guaranty.
18. THIS GUARANTY IS EXECUTED AND DELIVERED AS AN INCIDENT TO A LENDING
TRANSACTION NEGOTIATED, CONSUMMATED, AND PERFORMABLE IN DALLAS COUNTY, TEXAS,
AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF TEXAS. ANY ACTION OR PROCEEDING AGAINST ANY GUARANTOR UNDER OR IN CONNECTION
WITH THIS GUARANTY MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT IN DALLAS
COUNTY, TEXAS. EACH GUARANTOR HEREBY IRREVOCABLY (I) SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF SUCH COURTS, AND (II) WAIVES ANY OBJECTION IT MAY NOW OR
HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN SUCH
COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM. EACH GUARANTOR AGREES THAT
SERVICE OF PROCESS UPON IT MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN
RECEIPT REQUESTED, AT ITS ADDRESS SPECIFIED BELOW. NOTHING HEREIN SHALL AFFECT
THE RIGHT OF THE AGENT, THE DOCUMENTATION AGENT, OR ANY BANK OR ISSUING BANK TO
SERVE PROCESS IN ANY OTHER MATTER PERMITTED BY LAW OR SHALL LIMIT THE RIGHT OF
THE AGENT, THE DOCUMENTATION AGENT, OR ANY BANK OR ISSUING BANK TO BRING ANY
ACTION OR PROCEEDING AGAINST ANY GUARANTOR OR WITH RESPECT TO ANY OF SUCH
GUARANTOR'S PROPERTY IN COURTS IN OTHER JURISDICTIONS TO THE EXTENT SUCH
JURISDICTION IS PROPER. ANY ACTION OR PROCEEDING BY ANY GUARANTOR AGAINST THE
AGENT, THE DOCUMENTATION AGENT, ANY BANK OR ISSUING BANK SHALL BE BROUGHT ONLY
IN A COURT LOCATED IN DALLAS COUNTY, TEXAS.
19. Each Guarantor jointly and severally agrees to pay on demand all
reasonable attorneys' fees and all other costs and expenses incurred by the
Agent, the Documentation Agent, the Banks and the Issuing Banks in connection
with the preparation, administration, enforcement, or collection of this
Guaranty.
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 8
20. Each Guarantor hereby waives promptness, diligence, notice of any
default under the Guaranteed Indebtedness, demand of payment, notice of
acceptance of this Guaranty, presentment, notice of protest, notice of dishonor,
notice of acceleration, notice of intent to accelerate, notice of the incurring
by either Borrower of additional indebtedness, and all other notices and demands
with respect to the Guaranteed Indebtedness and this Guaranty.
21. The Credit Agreement, and all of the terms thereof, are incorporated
herein by reference, the same as if stated verbatim herein, and each Guarantor
agrees that the Agent, the Documentation Agent, the Banks and the Issuing Banks
may exercise any and all rights granted to them under the Credit Agreement and
the other Loan Documents (as defined in the Credit Agreement) without affecting
the validity or enforceability of this Guaranty.
22.(a) Each Guarantor hereby represents and warrants to the Agent, the
Documentation Agent, the Banks and the Issuing Banks that such Guarantor (a) has
adequate means to obtain from the Borrowers on a continuing basis information
concerning the financial condition and assets of the Borrowers and (b) is not
relying upon the Agent, the Documentation Agent, or any Bank or Issuing Bank to
provide (and the Agent, the Documentation Agent, the Banks and the Issuing Banks
shall have no duty to provide) any such information to such Guarantor either now
or in the future.
(b) THIS GUARANTY EMBODIES THE FINAL, ENTIRE AGREEMENT OF THE GUARANTORS,
THE AGENT, THE DOCUMENTATION AGENT, THE BANKS AND THE ISSUING BANKS WITH RESPECT
TO EACH GUARANTOR'S GUARANTY OF THE GUARANTEED INDEBTEDNESS AND SUPERSEDES ANY
AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND UNDERSTANDINGS,
WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF. THIS GUARANTY IS
INTENDED BY THE GUARANTORS, THE AGENT, THE DOCUMENTATION AGENT, THE BANKS AND
THE ISSUING BANKS AS A FINAL AND COMPLETE EXPRESSION OF THE TERMS OF THE
GUARANTY, AND NO COURSE OF DEALING AMONG THE GUARANTORS, THE AGENT, THE
DOCUMENTATION AGENT, THE BANKS AND THE ISSUING BANKS, NO COURSE OF PERFORMANCE,
NO TRADE PRACTICES, AND NO EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OR DISCUSSIONS OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE SHALL
BE USED TO CONTRADICT, VARY, SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY
AGREEMENT. THERE ARE NO ORAL AGREEMENTS AMONG THE GUARANTORS, THE AGENT, THE
DOCUMENTATION AGENT, THE BANKS AND THE ISSUING BANKS. THE PROVISIONS OF THIS
AGREEMENT MAY BE AMENDED OR WAIVED ONLY BY AN INSTRUMENT IN WRITING SIGNED BY
THE PARTIES HERETO. IN THE EVENT ANY TERM OR PROVISION OF THIS AGREEMENT
EXPRESSLY CONFLICTS WITH ANY TERM OR PROVISION OF THE CREDIT AGREEMENT, THE
TERMS AND PROVISIONS OF THE CREDIT AGREEMENT SHALL GOVERN AND CONTROL.
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 9
23. Each Guarantor acknowledges that it has had the benefit of legal
counsel of its own choice and has been afforded an opportunity to review this
Guaranty with its legal counsel and that this Guaranty shall be construed as if
jointly drafted by the Guarantors and the Agent.
EXECUTED as of the day and year first written above.
GUARANTORS:
HEALTHCOR PHARMACY, INC.
HEALTHCOR OXYGEN AND MEDICAL
EQUIPMENT, INC.
HEALTHCOR REHABILITATION SERVICES,
INC.
PHYSICIANS HOME HEALTH NETWORK, INC.
HC PERSONNEL RESOURCES, INC.
By:ββββββ β. ββββββ
President of each of the above Guarantors
Address: ββββ βββββ βββββββ ββββββββββ
βββββ β-ββββ
ββββββ, βββββ βββββ
Attn: S. βββββ ββββββ
AMENDED AND RESTATED SUBSIDIARY GUARANTY - Page 10
EXHIBIT "E-2"
AMENDED AND RESTATED BORROWER GUARANTY
AMENDED AND RESTATED BORROWER GUARANTY
WHEREAS, the execution of this Amended and Restated Borrower Guaranty
(this "Guaranty") by HealthCor, Inc., a Delaware corporation ("HealthCor") and
HealthCor Holdings, Inc., a Delaware corporation ("Holdings", and together with
HealthCor, the "Guarantors") is a condition to the Banks (hereinafter defined)
and the Issuing Banks (hereinafter defined) making loans to the Guarantors and
issuing letters of credit for the account of HealthCor, pursuant to that certain
Amended and Restated Credit Agreement dated of even date herewith among the
Guarantors, TEXAS COMMERCE BANK NATIONAL ASSOCIATION, a national banking
association, as agent (in such capacity, the "Agent"), THE FIRST NATIONAL BANK
OF CHICAGO, a national banking association, as documentation agent (in such
capacity, the "Documentation Agent"), the lenders from time to time party
thereto (collectively, the "Banks") and the Banks that issue letters of credit
thereunder (collectively, the "Issuing Banks") (such Amended and Restated Credit
Agreement, as the same may be amended, supplemented or otherwise modified from
time to time is hereinafter referred to as the "Credit Agreement"); and
WHEREAS, each of the Guarantors previously entered into that certain
Credit Agreement dated as of May 16, 1996, among the Guarantors, Texas Commerce
Bank National Association, as agent, the lenders party thereto and the lenders
issuing letters of credit thereunder (as amended, the "Existing Credit
Agreement"); and
WHEREAS, pursuant to the Existing Credit Agreement, each of the Guarantors
executed a Guaranty Agreement dated as of May 16, 1996 (collectively, the
"Existing Guaranties") pursuant to which each of the Guarantors guaranteed the
prompt payment and performance of all indebtedness, liabilities and obligations
of the other Guarantor under the Existing Credit Agreement; and
WHEREAS, the Guarantors have requested and the Agent, the Documentation
Agent, the Banks and the Issuing Banks have agreed, subject to certain terms and
conditions, to amend and restate the Existing Credit Agreement pursuant to the
terms of the Credit Agreement; and
WHEREAS, in connection therewith, the Guarantors and the Agent now desire
to amend and consolidate the Existing Guaranties as hereinafter provided, and
have agreed, for purposes of clarity and ease of administration, to carry out
the agreed upon amendments by amending the pertinent provisions of the Existing
Guaranties and restating the Existing Guaranties in their entireties by means of
this Guaranty;
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which are hereby acknowledged, each of the Guarantors hereby amends, restates
and consolidates the Existing Guaranties pursuant hereto and hereby irrevocably
and unconditionally guarantees to the Agent, the Documentation Agent, the Banks,
the Issuing Banks and each of them the full and prompt payment and performance
of the Guaranteed Indebtedness (hereinafter defined), this Guaranty being upon
the following terms:
1. All capitalized terms used and not otherwise defined herein shall have
their respective meanings as set forth in the Credit Agreement. The term
"Guaranteed Indebtedness",
AMENDED AND RESTATED BORROWER GUARANTY - Page 1
as used herein, means, as to each Guarantor, all of the "Obligations", as
defined in the Credit Agreement, other than the Obligations of such Guarantor.)
The term "Guaranteed Indebtedness" shall include any and all post-petition
interest and expenses (including reasonable attorneys' fees) whether or not
allowed under any bankruptcy, insolvency, or other similar law.
2. This instrument shall be an absolute, continuing, irrevocable, and
unconditional guaranty of payment and performance, and not a guaranty of
collection, and the Guarantors shall remain liable on their respective
obligations hereunder until the payment and performance in full of the
Guaranteed Indebtedness. No set-off, counterclaim, recoupment, reduction, or
diminution of any obligation, or any defense of any kind or nature which either
Guarantor may have against the other Guarantor, the Agent, the Documentation
Agent, any Bank or Issuing Bank, or any other party, shall be available to, or
shall be asserted by, such Guarantor against the other Guarantor, the Agent, the
Documentation Agent, any Bank, Issuing Bank or any subsequent holder of the
Guaranteed Indebtedness or any part thereof or against payment of the Guaranteed
Indebtedness or any part thereof.
3. The obligations of each Guarantor hereunder shall be limited to an
aggregate amount equal to the largest amount that would not render its
obligations hereunder subject to avoidance under Section 548 of the United
States Bankruptcy Code or to being set aside, avoided, or annulled under any
applicable state law relating to fraudulent transfers or fraudulent obligations.
4. If either Guarantor becomes liable for any indebtedness owing by the
other Guarantor to the Agent, the Documentation Agent, any Bank or Issuing Bank
by endorsement or otherwise, other than under this Guaranty, such liability
shall not be in any manner impaired or affected hereby, and the rights of the
Agent, the Documentation Agent, the Banks and the Issuing Banks hereunder shall
be cumulative of any and all other rights that the Agent, the Documentation
Agent, the Banks and the Issuing Banks may ever have against the other
Guarantor. The exercise by the Agent, the Documentation Agent, or any Bank or
Issuing Bank of any right or remedy hereunder or under any other instrument, or
at law or in equity, shall not preclude the concurrent or subsequent exercise of
any other right or remedy.
5. In the event of default by either Guarantor in payment or performance
of the Guaranteed Indebtedness, or any part thereof, when such Guaranteed
Indebtedness becomes due, whether by its terms, by acceleration, or otherwise,
the other Guarantor shall promptly pay the amount due thereon to the Agent, the
Documentation Agent, the Banks and the Issuing Banks without notice or demand in
lawful currency of the United States of America and it shall not be necessary
for the Agent, the Documentation Agent or any Bank or Issuing Bank, in order to
enforce such payment by such Guarantor, first to institute suit or exhaust its
remedies against the defaulting Guarantor or others liable on such Guaranteed
Indebtedness, or to enforce any rights against any collateral which shall ever
have been given to secure such Guaranteed Indebtedness. Notwithstanding anything
to the contrary contained in this Guaranty, each Guarantor hereby irrevocably
waives any and all rights it may now or hereafter have under any agreement or at
law or in equity (including, without limitation, any law subrogating such
Guarantor to the rights of the Agent, the Documentation Agent, the Banks and the
Issuing Banks) to assert any claim against or seek contribution, indemnification
or any other form of reimbursement from the other Guarantor or any other party
liable for payment of any or all of the Guaranteed Indebtedness for
AMENDED AND RESTATED BORROWER GUARANTY - Page 2
any payment made by such paying Guarantor under or in connection with this
Guaranty or otherwise.
6. If acceleration of the time for payment of any amount payable by either
Guarantor under the Guaranteed Indebtedness is stayed upon the insolvency,
bankruptcy, or reorganization of such Guarantor, all such amounts otherwise
subject to acceleration under the terms of the Guaranteed Indebtedness shall
nonetheless be payable by the other Guarantor hereunder forthwith on demand by
the Agent.
7. Each Guarantor hereby agrees that its obligations under this Guaranty
shall not be released, discharged, diminished, impaired, reduced, or affected
for any reason or by the occurrence of any event, including, without limitation,
one or more of the following events, whether or not with notice to or the
consent of such Guarantor: (a) the taking or accepting of collateral as security
for any or all of the Guaranteed Indebtedness or the release, surrender,
exchange, or subordination of any collateral now or hereafter securing any or
all of the Guaranteed Indebtedness; (b) any partial release of the liability of
such Guarantor hereunder, or the full or partial release of any other guarantor
from liability for any or all of the Guaranteed Indebtedness; (c) any disability
of the other Guarantor, or the dissolution, insolvency, or bankruptcy of either
Guarantor, or any other party at any time liable for the payment of any or all
of the Guaranteed Indebtedness; (d) any renewal, extension, modification,
waiver, amendment, or rearrangement of any or all of the Guaranteed Indebtedness
or any instrument, document, or agreement evidencing, securing, or otherwise
relating to any or all of the Guaranteed Indebtedness; (e) any adjustment,
indulgence, forbearance, waiver, or compromise that may be granted or given by
the Agent, the Documentation Agent, the Banks and the Issuing Banks to either
Guarantor, or any other party ever liable for any or all of the Guaranteed
Indebtedness; (f) any neglect, delay, omission, failure, or refusal of the
Agent, the Documentation Agent, the Banks and the Issuing Banks to take or
prosecute any action for the collection of any of the Guaranteed Indebtedness or
to foreclose or take or prosecute any action in connection with any instrument,
document, or agreement evidencing, securing, or otherwise relating to any or all
of the Guaranteed Indebtedness; (g) the unenforceability or invalidity of any or
all of the Guaranteed Indebtedness or of any instrument, document, or agreement
evidencing, securing, or otherwise relating to any or all of the Guaranteed
Indebtedness; (h) any payment by the other Guarantor or any other party to the
Agent, the Documentation Agent, any Bank or Issuing Bank is held to constitute a
preference under applicable bankruptcy or insolvency law or if for any other
reason the Agent, the Documentation Agent, or any Bank or Issuing Bank is
required to refund any payment or pay the amount thereof to someone else; (i)
the settlement or compromise of any of the Guaranteed Indebtedness; (j) the
non-perfection of any security interest or lien securing any or all of the
Guaranteed Indebtedness; any impairment of any collateral securing any or all of
the Guaranteed Indebtedness; (k) the failure of the Agent, the Documentation
Agent, or any Bank or Issuing Bank to sell any collateral securing any or all of
the Guaranteed Indebtedness in a commercially reasonable manner or as otherwise
required by law; or (l) any change in the corporate existence, structure, or
ownership of the other Guarantor.
8. Each Guarantor represents and warrants to the Agent, the Documentation
Agent, the Banks and the Issuing Banks as follows:
AMENDED AND RESTATED BORROWER GUARANTY - Page 3
(a) Such Guarantor is a corporation duly organized, validly existing
and in good standing under the laws of the state of its incorporation, and
is qualified to do business in all jurisdictions in which the nature of
the business conducted by it makes such qualification necessary and where
failure to so qualify would have a material adverse effect on its
business, financial condition, or operations.
(b) Such Guarantor has the corporate power and authority and legal
right to execute, deliver, and perform its obligations under this
Guaranty, and this Guaranty constitutes the legal, valid, and binding
obligation of such Guarantor, enforceable against it in accordance with
its respective terms, except as limited by bankruptcy, insolvency, or
other laws of general application relating to the enforcement of
creditor's rights.
(c) The execution, delivery, and performance by such Guarantor of
this Guaranty (i) have been duly authorized by all requisite action on the
part of such Guarantor, (ii) do not and will not violate or conflict with
(x) any law, rule, or regulation or any order, writ, injunction or decree
of any Governmental Authority or arbitrator, which violation would have a
material adverse effect on the business, condition (financial or
otherwise), operations, prospects, or properties of such Guarantor or any
other Company, the Collateral taken as a whole, or the ability of such
Guarantor or the other Companies to pay and perform the Guaranteed
Indebtedness, or (y) the articles of certificate of incorporation or
bylaws of such Guarantor, and (iii) do not and will not conflict with,
result in a breach of, or constitute a default under, or result in the
imposition of any lien upon any assets of such Guarantor pursuant to the
provisions of any material indenture, mortgage, deed of trust, security
agreement, franchise, permit, license, instrument, or agreement to which
such Guarantor or its properties is bound.
(d) No authorization, approval, or consent of, and no filing or
registration with, any Governmental Authority or third party is necessary
for the execution, delivery or performance by such Guarantor of this
Guaranty or the validity or enforceability thereof.
(e) The value of the consideration received and to be received by
such Guarantor as a result of the Guarantors, the Agent, the Documentation
Agent, the Banks and the Issuing Banks entering into the Credit Agreement
and such Guarantor executing and delivering this Guaranty is reasonably
worth at least as much as the liability and obligation of such Guarantor
hereunder, and such liability and obligation and the Credit Agreement have
benefited and may reasonably be expected to benefit such Guarantor
directly or indirectly.
(f) Such Guarantor has, independently and without reliance upon the
Agent, the Documentation Agent or any Bank or Issuing Bank and based upon
such documents and information as such Guarantor has deemed appropriate,
made its own analysis and decision to enter into this Guaranty.
(g) Such Guarantor and the consolidated corporate group of which
such Guarantor is a part will benefit from and such ability is necessary
and convenient to the conduct, promotion and attainment of the business of
the Guarantors.
AMENDED AND RESTATED BORROWER GUARANTY - Page 4
(h) Such Guarantor hereby acknowledges that, as additional
consideration for entering into this Guaranty it has obtained certain
rights under that certain Contribution and Indemnification Agreement of
even date herewith among the Guarantors and certain other guarantors of
the Guaranteed Indebtedness.
(i) Such Guarantor has adequate capital to conduct its business as a
going concern, as presently conducted and as proposed to be conducted;
such Guarantor will be able to meet its obligations hereunder and in
respect of its other existing and future indebtedness and liabilities as
and when the same shall be due and payable; such Guarantor is not
insolvent (as that term is defined in 11 U.S.C. ss. 101 or under other
applicable law) and will not be rendered insolvent by its obligations
hereunder; and the foregoing representations are supported by such
Guarantor's internal projections and forecasts.
(j) Such Guarantor has determined that the execution and delivery of
this Guaranty is to its advantage and benefit, taking into account all
relevant facts and circumstances.
(k) All of the representations and warranties contained in the
Credit Agreement, to the extent that they relate to such Guarantor, are
true and correct.
9. Each Guarantor covenants and agrees that, as long as the Guaranteed
Indebtedness or any part thereof is outstanding or any Bank or Issuing Bank has
any commitment under the Credit Agreement:
(a) Such Guarantor will furnish promptly to the Agent written notice
of the occurrence of any default under this Guaranty or any Default under
the Credit Agreement.
(b) Such Guarantor will furnish promptly to the Agent such
additional information concerning such Guarantor as the Agent, the
Documentation Agent, or any Bank or Issuing Bank may reasonably request.
(c) Such Guarantor will obtain at any time and from time to time all
authorizations, licenses, consents or approvals as shall now or hereafter
be necessary or desirable under all applicable laws or regulations to
conduct its business substantially as now conducted and as presently
proposed to be conducted or otherwise in connection with the execution,
delivery and performance of this Guaranty and will promptly furnish copies
thereof to the Agent.
10. If an Event of Default shall have occurred and be continuing, the
Agent, the Documentation Agent, the Banks and the Issuing Banks shall each have
the right to set off and apply against this Guaranty or the Guaranteed
Indebtedness or both, at any time and without notice to either Guarantor, any
and all deposits (general or special, time or demand, provisional or final) or
other sums at any time credited by or owing from the Agent, the Documentation
Agent or any Bank or Issuing Bank to such Guarantor whether or not the
Guaranteed Indebtedness is then due and irrespective of whether or not the
Agent, the Documentation Agent or any Bank or Issuing Bank shall have made any
demand under this Guaranty. As security for
AMENDED AND RESTATED BORROWER GUARANTY - Page 5
this Guaranty and the Guaranteed Indebtedness, each Guarantor hereby grants the
Agent, the Documentation Agent, the Banks and the Issuing Banks a security
interest in all money, instruments, certificates of deposit, and other property
of such Guarantor now or hereafter held by the Agent, the Documentation Agent,
any Bank or Issuing Bank. In addition to the rights of setoff of the Agent, the
Documentation Agent, the Banks and the Issuing Banks, and as further security
for this Guaranty and the Guaranteed Indebtedness, each Guarantor hereby grants
the Agent, the Documentation Agent, the Banks and the Issuing Banks a security
interest in all deposits (general or special, time or demand, provisional or
final) and all other accounts of such Guarantor now or hereafter on deposit with
or held by the Agent, the Documentation Agent, any Bank or Issuing Bank and all
other sums at any time credited by or owing from the Agent, the Documentation
Agent, any Bank or Issuing Bank to such Guarantor. The rights and remedies of
the Agent, the Documentation Agent, the Banks and the Issuing Banks hereunder
are in addition to other rights and remedies (including, without limitation,
other rights of setoff) which the Agent, the Documentation Agent, the Banks and
the Issuing Banks may have.
11. No amendment or waiver of any provision of this Guaranty or consent to
any departure by the Guarantors therefrom shall in any event be effective unless
the same shall be in writing and signed by the Agent. No failure on the part of
the Agent, the Documentation Agent or any Bank or Issuing Bank to exercise, and
no delay in exercising, any right, power, or privilege hereunder shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power, or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, power, or privilege. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
12. Any acknowledgment or new promise, whether by payment of principal or
interest or otherwise and whether by the Guarantors or others with respect to
any of the Guaranteed Indebtedness shall, if the statute of limitations in favor
of the Guarantors against the Agent, the Documentation Agent, the Banks or the
Issuing Banks shall have commenced to run, toll the running of such statute of
limitations and, if the period of such statute of limitations shall have
expired, prevent the operation of such statute of limitations.
13. This Guaranty is for the benefit of the Agent, the Documentation
Agent, the Banks and the Issuing Banks and their successors and assigns, and in
the event of an assignment of the Guaranteed Indebtedness, or any part thereof,
the rights and benefits hereunder, to the extent applicable to the indebtedness
so assigned, may be transferred with such indebtedness. This Guaranty is binding
not only on the Guarantors, but on the Guarantors' successors and assigns.
14. Each Guarantor recognizes that the Agent, the Documentation Agent, the
Banks and the Issuing Banks are relying upon this Guaranty and the undertakings
of such Guarantor hereunder in making extensions of credit to the other
Guarantor under the Credit Agreement and further recognizes that the execution
and delivery of this Guaranty is a material inducement to the Agent, the
Documentation Agent, the Banks and the Issuing Banks in entering into the Credit
Agreement. Each Guarantor hereby acknowledges that there are no conditions to
the full effectiveness of this Guaranty.
15. THIS GUARANTY IS EXECUTED AND DELIVERED AS AN INCIDENT TO
A LENDING TRANSACTION NEGOTIATED, CONSUMMATED, AND PERFORMABLE IN
AMENDED AND RESTATED BORROWER GUARANTY - Page 6
DALLAS COUNTY, TEXAS, AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF TEXAS. ANY ACTION OR PROCEEDING AGAINST EITHER
GUARANTOR UNDER OR IN CONNECTION WITH THIS GUARANTY MAY BE BROUGHT IN ANY STATE
OR FEDERAL COURT IN DALLAS COUNTY, TEXAS. EACH GUARANTOR HEREBY IRREVOCABLY (I)
SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURTS, AND (II) WAIVES ANY
OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH ACTION OR
PROCEEDING BROUGHT IN SUCH COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
EACH GUARANTOR AGREES THAT SERVICE OF PROCESS UPON IT MAY BE MADE BY CERTIFIED
OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, AT ITS ADDRESS SPECIFIED BELOW.
NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE AGENT, THE DOCUMENTATION AGENT, ANY
BANK OR ISSUING BANK TO SERVE PROCESS IN ANY OTHER MATTER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT OF THE AGENT, THE DOCUMENTATION AGENT, ANY BANK OR ISSUING
BANK TO BRING ANY ACTION OR PROCEEDING AGAINST EITHER GUARANTOR OR WITH RESPECT
TO ANY OF SUCH GUARANTOR'S PROPERTY IN COURTS IN OTHER JURISDICTIONS TO THE
EXTENT SUCH JURISDICTION IS PROPER. ANY ACTION OR PROCEEDING BY THE GUARANTORS
AGAINST THE AGENT, THE DOCUMENTATION AGENT, ANY BANK OR ISSUING BANK SHALL BE
BROUGHT ONLY IN A COURT LOCATED IN DALLAS COUNTY, TEXAS.
16. The Guarantors shall pay on demand all reasonable attorneys' fees and
all other costs and expenses incurred by the Agent, the Documentation Agent, the
Banks and the Issuing Banks in connection with the enforcement or collection of
this Guaranty.
17. Each Guarantor hereby waives promptness, diligence, notice of any
default under the Guaranteed Indebtedness, demand of payment, notice of
acceptance of this Guaranty, presentment, notice of protest, notice of dishonor,
notice of acceleration, notice of intent to accelerate, notice of the incurring
by the other Guarantor of additional indebtedness, and all other notices and
demands with respect to the Guaranteed Indebtedness and this Guaranty.
18. The Credit Agreement, and all of the terms thereof, are incorporated
herein by reference, the same as if stated verbatim herein, and each Guarantor
agrees that the Agent, the Documentation Agent, the Banks and the Issuing Banks
may exercise any and all rights granted to them under the Credit Agreement and
the other Loan Documents (as defined in the Credit Agreement) without affecting
the validity or enforceability of this Guaranty.
19. Each Guarantor hereby represents and warrants to the Agent, the
Documentation Agent, the Banks and the Issuing Banks that such Guarantor (a) has
adequate means to obtain from the other Guarantor on a continuing basis
information concerning the financial condition and assets of such other
Guarantor and (b) is not relying upon the Agent, the Documentation Agent or any
Bank or Issuing Bank to provide (and the Agent, the Documentation Agent, the
Banks and the Issuing Banks shall have no duty to provide) any such information
to the Guarantors either now or in the future.
AMENDED AND RESTATED BORROWER GUARANTY - Page 7
20. THIS GUARANTY EMBODIES THE FINAL, ENTIRE AGREEMENT OF THE GUARANTORS,
THE AGENT, THE DOCUMENTATION AGENT, THE BANKS AND THE ISSUING BANKS WITH RESPECT
TO THE RESPECTIVE GUARANTORS' GUARANTY OF THE GUARANTEED INDEBTEDNESS AND
SUPERSEDES ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS, AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE SUBJECT MATTER HEREOF.
THIS GUARANTY IS INTENDED BY THE GUARANTORS, THE AGENT, THE DOCUMENTATION AGENT,
THE BANKS AND THE ISSUING BANKS AS A FINAL AND COMPLETE EXPRESSION OF THE TERMS
OF THE GUARANTY, AND NO COURSE OF DEALING AMONG THE GUARANTORS, THE AGENT, THE
DOCUMENTATION AGENT, THE BANKS AND THE ISSUING BANKS, NO COURSE OF PERFORMANCE,
NO TRADE PRACTICES, AND NO EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OR DISCUSSIONS OR OTHER EXTRINSIC EVIDENCE OF ANY NATURE SHALL BE
USED TO CONTRADICT, VARY, SUPPLEMENT OR MODIFY ANY TERM OF THIS GUARANTY. THERE
ARE NO ORAL AGREEMENTS AMONG THE GUARANTORS, THE AGENT, THE DOCUMENTATION AGENT,
THE BANKS AND THE ISSUING BANKS.
EXECUTED as of the 31st day of October, 1996.
GUARANTORS:
HEALTHCOR, INC.
HEALTHCOR HOLDINGS, INC.
By:S. βββββ ββββββ
Chief Executive Officer
Address: ββββ βββββ βββββββ ββββββββββ
βββββ β-ββββ
ββββββ, βββββ βββββ
Attn.: S. βββββ ββββββ
AMENDED AND RESTATED BORROWER GUARANTY - Page 8
EXHIBIT "F"
AMENDED AND RESTATED PLEDGE AGREEMENT
AMENDED AND RESTATED PLEDGE AGREEMENT
This AMENDED AND RESTATED PLEDGE AGREEMENT (this "Agreement"), dated as of
October 31, 1996, is by and among the corporations signatory hereto under the
heading "Pledgors" on the signature pages hereof (whether one or more,
collectively referred to as the "Pledgors" and individually as a "Pledgor") and
TEXAS COMMERCE BANK NATIONAL ASSOCIATION, a national banking association, as
agent (in such capacity, the "Agent") for itself, the Documentation Agent
(hereinafter defined), the other Issuing Banks (hereinafter defined) and the
other lenders (collectively, the "Banks") from time to time party to that
certain Amended and Restated Credit Agreement dated of even date herewith among
HealthCor, Inc., a Delaware corporation ("HealthCor"), Healthcor Holdings, Inc.,
a Delaware corporation ("Holdings", and together with HealthCor, the
"Borrowers"), the Agent, Texas Commerce Bank National Association and each of
the other Banks issuing letters of credit from time to time thereunder (in such
capacity, collectively, the "Issuing Banks"), The First National Bank of
Chicago, a national banking association, as documentation agent (in such
capacity, the "Documentation Agent") and the Banks, as the same may be amended
or modified from time to time (the "Credit Agreement").
R E C I T A L S:
A. The Borrowers, the Agent, certain lenders (collectively, the "Existing
Banks"), and the Existing Banks issuing letters of credit thereunder (in such
capacity, the "Existing Issuing Banks") previously entered into that certain
Credit Agreement dated as of May 16, 1996 (as amended, the "Existing Credit
Agreement").
B. Pursuant to the Existing Credit Agreement, Pledgor executed and
delivered to the Agent a Pledge Agreement dated as of May 16, 1996, which
secured the obligations of the Borrowers under the Existing Credit Agreement
(the "Existing Pledge Agreement").
C. Concurrently herewith the Borrowers, the Agent, the Documentation
Agent, the Banks and the Issuing Banks are amending and restating the Existing
Credit Agreement pursuant to the Credit Agreement and in connection therewith,
the parties hereto now desire to amend and restate the Existing Pledge
Agreement, as hereinafter provided, and have agreed, for purposes of clarity and
ease of administration, to carry out the agreed upon amendments by amending the
pertinent provisions of the Existing Pledge Agreement and then restating the
Existing Pledge Agreement in its entirety by means of this Agreement.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows and the Existing Pledge
Agreement is hereby amended, consolidated and restated in its entirety as
follows:
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 1
ARTICLE I
DEFINITION; SECURITY INTEREST AND PLEDGE
Section 1.1 DEFINITIONS. All capitalized terms used and not otherwise
defined herein shall have their respective meanings as set forth in the Credit
Agreement.
Section 1.2 SECURITY INTEREST AND PLEDGE. Each Pledgor hereby pledges and
grants to the Agent, for the benefit of itself, the Documentation Agent, the
Banks and the Issuing Banks, and confirms that the Agent has been previously
granted and now possesses a security interest in the following property (such
property being hereinafter sometimes called the "Collateral"):
(a) all present and future issued and outstanding shares of capital
stock or other equity or investment securities now owned or hereafter
acquired by such Pledgor, including without limitation, the shares of
stock more fully described on Schedule I attached hereto;
(b) all present and future increases, profits, combinations,
reclassifications of, and substitutes and replacements for, all or part of
the foregoing, and all present and future accounts, contract rights,
general intangibles, chattel paper, documents, instruments, cash and
noncash proceeds, and other rights arising from or by virtue of, or from
the voluntary or involuntary sale, lease, or other disposition of, or
collections with respect to, or proceeds payable by virtue of claims
against any Person with respect to, all or any part of the foregoing; and
(c) all products, proceeds, revenues, distributions, dividends,
stock dividends, securities, and other property, rights, and interests any
Pledgor receives or is at any time entitled to receive on account of any
of the foregoing.
Section 1.3 OBLIGATIONS. The Collateral shall secure the following
obligations, indebtedness, and liabilities (all such obligations, indebtedness,
and liabilities being hereinafter sometimes called the "Obligations"): (a) the
obligations, indebtedness, and liabilities of HealthCor to the Banks and the
Issuing Banks evidenced by the Revolving Credit Notes (herein so called)
executed by HealthCor pursuant to the Credit Agreement; (b) the obligations,
indebtedness, and liabilities of Holdings to the Banks evidenced by the
Acquisition Line Notes executed by Holdings pursuant to the Credit Agreement;
(c) the respective obligations, indebtedness, and liabilities of the Borrowers
to the Agent, the Documentation Agent, the Banks and the Issuing Banks under
that certain Amended and Restated Borrower Guaranty of even date herewith,
executed by the Borrowers in favor of the Agent, the Documentation Agent, the
Banks and the Issuing Banks, pursuant to the Credit Agreement; (d) the
respective obligations, indebtedness, and liabilities of the Borrowers to the
Agent, the Documentation Agent, the Banks and the Issuing Banks under the Credit
Agreement; (e) the respective obligations, indebtedness and liabilities of the
Pledgors, other than the Borrowers, under that certain Amended and Restated
Subsidiary Guaranty of even date herewith executed by such Pledgors in favor of
the Agent, the Documentation Agent, the Banks and the Issuing Banks pursuant to
the Credit Agreement; (f) all
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 2
future advances by the Banks and the Issuing Banks to the Borrowers, or either
of them; (g) all costs and expenses, including without limitation attorneys'
fees and legal expenses incurred by the Agent, the Documentation Agent, the
Banks and the Issuing Banks to preserve and maintain the Collateral, collect the
obligations herein described, and enforce this Agreement; (h) all other
Obligations (as such term is defined in the Credit Agreement); and (i) all
extensions, renewals and modifications of any of the foregoing.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Each Pledgor represents and warrants to the Agent, the Documentation
Agent, the Banks and the Issuing Banks that:
Section 2.1 TITLE. Such Pledgor owns, and with respect to Collateral
acquired after the date hereof, such Pledgor will own, legally and beneficially,
the Collateral free and clear of any Lien, or any right or option on the part of
any Person to purchase or otherwise acquire the Collateral or any part thereof,
except for the security interest granted hereunder. The Collateral is not
subject to any restriction on transfer or assignment except for compliance with
applicable federal and state securities laws and regulations promulgated
thereunder. Such Pledgor has the unrestricted right to pledge the Collateral as
contemplated hereby. All of the Collateral has been duly and validly issued and
is fully paid and nonassessable.
Section 2.2 ORGANIZATION AND AUTHORITY. Each Pledgor is a corporation duly
organized, validly existing, and in good standing under the laws of the state of
its incorporation. Each Pledgor has the corporate power and authority to
execute, deliver, and perform this Agreement, and the execution, delivery, and
performance of this Agreement by such Pledgor (a) have been duly authorized by
all necessary corporate action on the part of such Pledgor, (b) do not and will
not violate or conflict with (i) any law, rule, or regulation or any order,
writ, injunction, or decree of any Governmental Authority or arbitrator, which
violation would have a material adverse effect on the business, condition
(financial or otherwise), operations, prospects, or properties of such Pledgor,
the Collateral taken as a whole, or the ability of the Companies to pay and
perform the Obligations, or (ii) the articles of incorporation or bylaws of such
Pledgor, and (c) do not and will not conflict with, result in a breach of, or
constitute a default under the provisions of any material indenture, mortgage,
deed of trust, security agreement, instrument or agreement binding on such
Pledgor or any of its property.
Section 2.3 PRINCIPAL PLACE OF BUSINESS. The principal place of business
and chief executive office of each Pledgor, and the office where each Pledgor
keeps its books and records, is located at the address of such Pledgor shown on
the signature pages hereof.
Section 2.4 PERCENTAGE OF STOCK. The Collateral constitutes one hundred
percent (100%) of the issued and outstanding shares of capital stock of each
issuer thereof.
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 3
Section 2.5 FIRST PRIORITY PERFECTED SECURITY INTEREST. This Agreement
creates and continues in favor of the Agent for the benefit of itself, the
Documentation Agent, the Banks and the Issuing Banks, a first priority perfected
security interest in the Collateral. There are no conditions precedent to the
effectiveness of this Agreement that have not been fully and permanently
satisfied.
ARTICLE III
AFFIRMATIVE AND NEGATIVE COVENANTS
Each Pledgor covenants and agrees with the Agent, the Documentation Agent,
the Banks and the Issuing Banks that:
Section 3.1 ENCUMBRANCES. Such Pledgor shall not create, permit, or suffer
to exist, and shall defend the Collateral against, any Lien on the Collateral
except the pledge and security interest of the Agent hereunder and the Permitted
Liens, and shall defend such Pledgor's rights in the Collateral and the Agent's
security interest in the Collateral against the claims of all Persons.
Section 3.2 SALE OF COLLATERAL. Such Pledgor shall not sell, assign, or
otherwise dispose of the Collateral or any part thereof without the prior
written consent of the Agent.
Section 3.3 DISTRIBUTIONS. If such Pledgor shall become entitled to
receive or shall receive any stock certificate (including, without limitation,
any certificate representing a stock dividend or a distribution in connection
with any reclassification, increase, or reduction of capital or issued in
connection with any reorganization), option or rights, whether as an addition
to, in substitution of, or in exchange for any Collateral or otherwise, such
Pledgor agrees to accept the same as the Agent's agent and to hold the same in
trust for the Agent, and to deliver the same forthwith to the Agent in the exact
form received, with the appropriate endorsement of such Pledgor, when necessary,
and/or appropriate undated stock powers duly executed in blank, to be held by
the Agent as additional Collateral for the Obligations, subject to the terms
hereof. Any sums paid upon or in respect of the Collateral upon the liquidation
or dissolution of the issuer thereof shall be paid over to the Agent to be held
by it as additional Collateral for the Obligations subject to the terms hereof;
and in case any distribution of capital shall be made on or in respect of the
Collateral or any property shall be distributed upon or with respect to the
Collateral pursuant to any recapitalization or reclassification of the capital
of the issuer thereof or pursuant to any reorganization of the issuer thereof,
the property so distributed shall be delivered to the Agent to be held by it, as
additional Collateral for the Obligations, subject to the terms hereof. All sums
of money and property so paid or distributed in respect of the Collateral that
are received by such Pledgor shall, until paid or delivered to the Agent, be
held by such Pledgor in trust as additional security for the Obligations.
Section 3.4 FURTHER ASSURANCES. At any time and from time to time, upon
the request of the Agent, and at the sole expense of such Pledgor, such Pledgor
shall promptly execute and deliver all such further instruments and documents
and take such further action as the Agent may
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 4
deem necessary or desirable to preserve and perfect its security interest in the
Collateral and carry out the provisions and purposes of this Agreement,
including, without limitation, the execution and filing of such financing
statements, continuation statements and other documents in such offices as the
Agent may require. A carbon, photographic, or other reproduction of this
Agreement or of any financing statement covering the Collateral or any part
thereof shall be sufficient as a financing statement and may be filed as a
financing statement. Subject to the right of such Pledgor to receive cash
dividends under Section 4.3 hereof, in the event any Collateral is ever received
by such Pledgor, such Pledgor shall promptly transfer and deliver to the Agent
such Collateral so received by such Pledgor (together with any necessary
endorsements in blank or undated stock powers duly executed in blank), which
Collateral shall thereafter be held by the Agent pursuant to the terms of this
Agreement. The Agent shall at all times have the right to exchange any
certificates representing Collateral for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.
Section 3.5 INSPECTION RIGHTS. Such Pledgor shall permit the Agent, the
Documentation Agent, the Banks, the Issuing Banks and their representatives,
upon one (1) Business Day's prior notice, to examine, inspect, and copy such
Pledgor's books and records at any reasonable time and as often as they may
desire.
Section 3.6 NOTIFICATION. Such Pledgor shall promptly notify the Agent of
(i) any Lien or material claim made or threatened against the Collateral, (ii)
any material change in the Collateral, including, without limitation, any
material decrease in the value of the Collateral, and (iii) the occurrence or
existence of any Default.
Section 3.7 BOOKS AND RECORDS; INFORMATION. Such Pledgor shall keep
accurate and complete books and records of the Collateral and such Pledgor's
business and financial condition in accordance with GAAP (subject to year-end
adjustments and disclosures). Such Pledgor shall from time to time at the
request of the Agent deliver to the Agent such information regarding the
Collateral and such Pledgor as the Agent may request. Such Pledgor shall ββββ
its books and records to reflect the security interest of the Agent under this
Agreement.
Section 3.8 ADDITIONAL SECURITIES. Such Pledgor shall not consent to or
approve the issuance of any additional shares of any class of capital stock of
the issuer of the Collateral, or any securities convertible into, or
exchangeable for, any such shares or any warrants, options, rights, or other
commitments entitling any Person to purchase or otherwise acquire any such
shares.
Section 3.9 PROVIDE INFORMATION. Such Pledgor shall fully cooperate, to
the extent requested by the Agent, in the completion of any notice, form,
schedule, or other document filed by the Agent on its own behalf or on behalf of
such Pledgor, including, without limitation, any required notice or statement of
beneficial ownership or of the acquisition of beneficial ownership of equity
securities constituting part of the Collateral and any notice of proposed sale
of any such securities pursuant to Rule 144 as promulgated by the Securities and
Exchange Commission ("SEC") under the Securities Act of 1933, as amended.
Without limiting the generality of the foregoing, such Pledgor shall furnish to
the Agent any and all information which the Agent may
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 5
reasonably request for purposes of any such filing, regarding such Pledgor, the
Collateral, and any issuer of any of the Collateral, and such Pledgor shall
disclose to the Agent all material adverse information known by such Pledgor
with respect to the operations of any issuer of any of the Collateral.
ARTICLE IV
RIGHTS OF THE AGENT AND PLEDGORS
Section 4.1 CERTAIN COVENANTS AND RIGHTS REGARDING COLLATERAL.
(a) Each Pledgor shall from time to time at the request of the Agent
furnish the Agent with a schedule of each account included in the
Collateral and a list of all those liable on checks, notes, drafts, and
other instruments representing the proceeds of such accounts. The Agent
shall have the right to make test verifications of the Collateral. If any
part of the Collateral is or becomes subject to the Federal Assignment of
Claims Act, the Pledgor whose Collateral is or becomes affected thereby
will execute all instruments and take all steps required by the Agent to
comply with that act. If part of the Collateral is evidenced by promissory
notes, trade acceptances or other instruments for the payment of money,
each Pledgor will, at the request of the Agent, immediately deliver them
to the Agent, appropriately endorsed to the Agent's order, and regardless
of the form of endorsement, each Pledgor waives presentment, demand,
notice of dishonor, protest, and notice of protest.
(b) If the validity or priority of this Agreement or of any rights,
titles, security interests or other interests created or evidenced hereby
shall be attacked, endangered, or questioned, or if any legal proceedings
are instituted with respect thereto, the Pledgors will give prompt written
notice thereof to the Agent and, at the Pledgors' own cost and expense,
will diligently endeavor to cure any defect which may be developed or
claimed, and will take all necessary and proper steps for the defense of
such legal proceedings, and the Agent (whether or not named as a party to
the legal proceedings with respect thereto) is hereby authorized and
empowered to take such additional steps as in its judgment and discretion
may be necessary or proper for the defense of any such legal proceedings
or the protection of the validity or priority of this Agreement and the
rights, titles, security interests, and other interests created or
evidenced hereby, and all expenses so incurred of every kind and character
shall be a demand obligation owing by the Pledgors and the party incurring
such expenses shall be subrogated to all rights of the Person receiving
such payment.
(c) Upon the occurrence of an Event of Default or if the Agent shall
deem payment of the Obligations to be insecure, and at any time
thereafter, the Agent is authorized to take possession peaceably of the
Collateral and of all books, records and accounts relating thereto, and to
exercise without interference from the Pledgors any and all rights which
such Pledgors have with respect to the management, possession,
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 6
protection, or preservation of the Collateral. If necessary to obtain the
possession provided for above, the Agent may invoke any and all legal
remedies to dispossess the Pledgors, including specifically one or more
actions for forcible entry and detainer. In connection with any action
taken by the Agent pursuant to this Section, the Agent shall not be liable
for any loss sustained by the Pledgors resulting from any act or omission
of the Agent unless such loss is caused by the willful misconduct and bad
faith of the Agent, nor shall the Agent be obligated to perform or
discharge any obligation, duty, or liability under any sale or lease
agreement covering the Collateral or any part thereof, or under or by
reason of this Agreement or exercise of rights or remedies hereunder.
(d) At any time prior to the termination of this Agreement the Agent
may notify the account debtors or obligors of any accounts, chattel paper,
negotiable instruments, or other evidences of indebtedness included in the
Collateral to pay the Agent directly. Until the Agent elects to exercise
these rights, each Pledgor is authorized as agent of the Agent to collect
and enforce such accounts. The costs of collection and enforcement,
including attorneys' fees and expenses, shall be borne solely by the
Pledgors whether incurred by the Agent or the Pledgors.
Section 4.2 VOTING RIGHTS. Unless and until an Event of Default shall have
occurred and be continuing, each Pledgor shall be entitled to exercise any and
all voting rights pertaining to the Collateral owned by such Pledgor or any part
thereof for any purpose not inconsistent with the terms of this Agreement or the
Credit Agreement. The Agent shall execute and deliver to each Pledgor all such
proxies and other instruments as each Pledgor may reasonably request for the
purpose of enabling such Pledgor to exercise the voting rights which it is
entitled to exercise pursuant to this Section.
Section 4.3 DIVIDENDS. Unless and until an Event of Default shall have
occurred and be continuing, each Pledgor shall be entitled to receive and retain
any dividends on the Collateral, owned by such Pledgor paid in cash out of
earned surplus to the extent and only to the extent that such dividends are
permitted by the Credit Agreement.
Section 4.4 PERFORMANCE BY THE AGENT. If any Pledgor fails to perform or
comply with any of its agreements contained herein, the Agent itself may, at its
sole discretion, cause or attempt to cause performance or compliance with such
agreement, and the expenses of the Agent, together with interest thereon at the
Default Rate, shall be payable by such Pledgor to the Agent on demand and shall
constitute Obligations secured by this Agreement. The Agent, upon making such
payment, shall be subrogated to all of the rights of the Person receiving such
payment. Notwithstanding the foregoing, it is expressly agreed that the Agent
shall not have any liability or responsibility for the performance of any
obligation of any Pledgor under this Agreement.
Section 4.5 SETOFF; PROPERTY HELD BY THE AGENT. If an Event of Default
shall have occurred and be continuing, the Agent shall have the right to set off
and apply against the Obligations, at any time and without notice to the
Pledgors, any and all deposits (general or special, time or demand, provisional
or final) or other sums at any time credited by or owing
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 7
from the Agent to any Pledgor whether or not the Obligations are then due. As
additional security for the Obligations, each Pledgor hereby grants the Agent a
security interest in all money, instruments, and other property of such Pledgor
now or hereafter held by the Agent. In addition to the Agent's right of setoff
and as further security for the Obligations, each Pledgor hereby grants the
Agent a security interest in all deposits (general or special, time or demand,
provisional or final) and other accounts of such Pledgor now or hereafter
maintained with the Agent and all other sums at any time credited by or owing
from the Agent to such Pledgor. The rights and remedies of the Agent hereunder
are in addition to other rights and remedies (including, without limitation,
other rights of setoff) which the Agent may have.
Section 4.6 THE AGENT'S DUTY OF CARE. Other than the exercise of
reasonable care in the physical custody of the Collateral while held by the
Agent hereunder, the Agent shall have no responsibility for or obligation or
duty with respect to all or any part of the Collateral or any matter or
proceeding arising out of or relating thereto, including, without limitation,
any obligation or duty to collect any sums due in respect thereof or to protect
or preserve any rights against prior parties or any other rights pertaining
thereto, it being understood and agreed that each Pledgor shall be responsible
for preservation of all rights in the Collateral owned by such Pledgor. Without
limiting the generality of the foregoing, the Agent shall be conclusively deemed
to have exercised reasonable care in the custody of the Collateral if the Agent
takes such action, for purposes of preserving rights in the Collateral, as such
Pledgor may reasonably request in writing, but no failure or omission or delay
by the Agent in complying with any such request by any Pledgor, and no refusal
by the Agent to comply with any such request by any Pledgor, shall be deemed to
be a failure to exercise reasonable care. The Agent shall not be responsible for
any decline in the value of the Collateral and shall not be required to take any
steps to preserve rights against prior parties or to protect, preserve, or
maintain any Lien given to secure the Collateral.
Section 4.7 ASSIGNMENT BY THE AGENT. The Agent, the Documentation Agent,
the Banks and the Issuing Banks may at any time and from time to time assign the
Obligations and any portion thereof and/or the Collateral and any portion
thereof, and the assignee shall be entitled to all of the rights and remedies of
the Agent, the Documentation Agent, the Banks and the Issuing Banks under this
Agreement in relation thereto.
ARTICLE V
DEFAULT
Section 5.1 RIGHTS AND REMEDIES. If any Event of Default shall occur, the
Agent shall have the following rights and remedies:
(i) In addition to all other rights and remedies granted to the
Agent in this Agreement and in any other instrument or agreement securing,
evidencing, or relating to the Obligations, the Agent shall have all of
the rights and remedies of a secured party under the Uniform Commercial
Code as adopted by the State of Texas. Without limiting
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 8
the generality of the foregoing, the Agent may (A) without demand or
notice to any Pledgor, collect, receive, or take possession of the
Collateral or any part thereof, (B) sell or otherwise dispose of the
Collateral, or any part thereof, in one or more parcels at public or
private sale or sales, at the Agent's offices or elsewhere, for cash, on
credit, or for future delivery, and/or (C) bid and become a purchaser at
any sale free of any right or equity of redemption in any Pledgor, which
right or equity is hereby expressly waived and released by each Pledgor.
Upon the request of the Agent, each Pledgor shall assemble the Collateral
owned by such Pledgor and make it available to the Agent at any place
designated by the Agent that is reasonably convenient to such Pledgor and
the Agent. Each Pledgor agrees that the Agent shall not be obligated to
give more than ten (10) days prior written notice of the time and place of
any public sale or of the time after which any private sale may take place
and that such notice shall constitute reasonable notice of such matters.
The Agent shall not be obligated to make any sale of the Collateral
regardless of notice of sale having been given. The Agent may adjourn any
public or private sale from time to time by announcement at the time and
place fixed therefor, and such sale may, without further notice, be made
at the time and place to which it was so adjourned. Each Pledgor shall be
liable for all expenses of retaking, holding, preparing for sale, or the
like, and all attorneys' fees and other expenses incurred by the Agent in
connection with the collection of the Obligations and the enforcement of
the Agent's rights under this Agreement, all of which expenses and fees
shall constitute additional Obligations secured by this Agreement. Each
Pledgor shall remain liable for any deficiency if the proceeds of any sale
or disposition of the Collateral are insufficient to pay the Obligations.
Each Pledgor waives all rights of marshalling in respect of the
Collateral.
(ii) The Agent may cause any or all of the Collateral held by it to
be transferred into the name of the Agent or the name or names of the
Agent's nominee or nominees.
(iii) The Agent may collect or receive all money or property at any
time payable or receivable on account of or in exchange for any of the
Collateral, but shall be under no obligation to do so.
(iv) The Agent shall have the right, but shall not be obligated to,
exercise or cause to be exercised all voting, consensual, and other powers
of ownership pertaining to the Collateral, and each Pledgor shall deliver
to the Agent, if requested by the Agent, irrevocable proxies with respect
to the Collateral in form satisfactory to the Agent.
(v) Each Pledgor hereby acknowledges and confirms that the Agent may
be unable to effect a public sale of any or all of the Collateral by
reason of certain prohibitions contained in the Securities Act of 1933, as
amended, and applicable state securities laws and may be compelled to
resort to one or more private sales thereof to a restricted group of
purchasers who will be obligated to agree, among other things, to acquire
any shares of the Collateral for their own respective accounts for
investment and not with a view to distribution or resale thereof. Each
Pledgor further acknowledges and
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 9
confirms that any such private sale may result in prices or other terms
less favorable to the seller than if such sale were a public sale and,
notwithstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner, and
the Agent shall be under no obligation to take any steps in order to
permit the Collateral to be sold at a public sale. The Agent shall be
under no obligation to delay a sale of any of the Collateral for any
period of time necessary to permit any issuer thereof to register such
Collateral for public sale under the Securities Act of 1933, as amended,
or under applicable state securities laws.
(vi) On any sale of the Collateral, the Agent is hereby authorized
to comply with any limitation or restriction with which compliance is
necessary, in the view of the Agent's counsel, in order to avoid any
violation of applicable law or in order to obtain any required approval of
the purchaser or purchasers by any applicable governmental authority.
Section 5.2 APPLICATION OF PROCEEDS OF SALE. The proceeds of any sale of
Collateral pursuant to Section 5.1 hereof, as well as any Collateral consisting
of cash, shall be applied by the Agent as follows:
FIRST, to the payment of all reasonable out-of-pocket costs and
expenses incurred by the Agent in connection with such sale or otherwise
in connection with this Agreement or any of the Obligations, including,
but not limited to, all court costs and the reasonable fees and expenses
of its agents and one legal counsel, the repayment of all advances made
hereunder or under any other Loan Document by the Agent on behalf of any
Pledgor and any other costs or expenses incurred in connection with the
exercise of any right or remedy hereunder;
SECOND, to the payment in full of all other Obligations that are
payable to the Agent or the Documentation Agent including, without
limitation, all expense reimbursements and indemnities;
THIRD, to the payment of all reasonable out-of-pocket costs and
expenses incurred by the Issuing Banks in connection with the Credit
Agreement, any Letter of Credit, or any of the Obligations, including, but
not limited to, all court costs and the reasonable fees and expenses of
their agents and one legal counsel;
FOURTH, to the payment in full of all other Obligations that are
payable to the Issuing Banks, including, without limitation, all Letter of
Credit disbursements and all accrued and unpaid interest thereon and all
Letter of Credit fees;
FIFTH, to the payment in full of the Obligations, pro rata among the
Banks in accordance with the amounts of the Loans held by them, or, if no
Loans shall be outstanding, in accordance with the amounts of their
Commitments;
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 10
SIXTH, if any Letter of Credit remains outstanding, the Agent, after
making the applications required by paragraphs "FIRST" through "FIFTH"
above, shall hold back and retain as Collateral for the Obligations an
amount equal to the aggregate face amounts of all outstanding Letters of
Credit; and
SEVENTH, provided that all of the Obligations have been paid and
performed in full and all Commitments and Letters of Credit have
terminated, to the Pledgors, or their respective successors or assigns, or
to whomsoever may lawfully be entitled to the same, or as a court of
competent jurisdiction may otherwise direct.
Upon any sale of the Collateral by the Agent (including, without limitation, a
sale pursuant to any applicable Uniform Commercial Code or under a judicial
proceeding), the receipt of the Agent or of the officer making the sale shall be
a sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Agent or such
officer or be answerable in any way for the misapplication thereof.
ARTICLE VI
MISCELLANEOUS
Section 6.1 NO WAIVER; CUMULATIVE REMEDIES. No failure on the part of the
Agent to exercise and no delay in exercising, and no course of dealing with
respect to, any right, power, or privilege under this Agreement shall operate as
a waiver thereof, nor shall any single or partial exercise of any right, power,
or privilege under this Agreement preclude any other or further exercise thereof
or the exercise of any other right, power, or privilege. The rights and remedies
provided for in this Agreement are cumulative and not exclusive of any rights
and remedies provided by law.
Section 6.2 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon
and inure to the benefit of the Pledgors, the Agent, the Documentation Agent,
the Banks, the Issuing Banks, and their respective heirs, successors, and
assigns, except that no Pledgor may assign any of its rights or obligations
under this Agreement without the prior written consent of the Agent.
Section 6.3 AMENDMENT; ENTIRE AGREEMENT; CONTROLLING AGREEMENT. THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS EMBODY THE FINAL, ENTIRE AGREEMENT AMONG
THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS,
REPRESENTATIONS, AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THE
SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE
PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO. THERE ARE
NO ORAL AGREEMENTS AMONG THE PARTIES HERETO. The provisions of this Agreement
may be amended or waived only by an
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 11
instrument in writing signed by the parties hereto. In the event any term or
provision of this Agreement expressly conflicts with any term or provision of
the Credit Agreement, the terms and provisions of the Credit Agreement shall
govern and control.
Section 6.4 NOTICES. All notices and other communications provided for in
this Agreement shall be given or made in writing and telecopied, mailed by
certified mail return receipt requested, or delivered to the intended recipient
at the "Address for Notices" specified below its name on the signature pages
hereof; or, as to any party, at such other address as shall be designated by
such party in a notice to any other party given in accordance with this Section.
Except as otherwise provided in this Agreement, all such communications shall be
deemed to have been duly given when transmitted by telecopy, subject to
telephone confirmation of receipt, or when personally delivered or, in the case
of a mailed notice, when duly deposited in the mails, in each case given or
addressed as aforesaid.
Section 6.5 APPLICABLE LAW; VENUE; SERVICE OF PROCESS. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS AND THE APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS AGREEMENT
HAS BEEN ENTERED INTO IN DALLAS COUNTY, TEXAS, AND IT SHALL BE PERFORMABLE FOR
ALL PURPOSES IN DALLAS COUNTY, TEXAS. ANY ACTION OR PROCEEDING AGAINST ANY
PLEDGOR UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER INSTRUMENT OR
AGREEMENT SECURING, EVIDENCING, OR RELATING TO THE OBLIGATIONS OR ANY PART
THEREOF MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT IN DALLAS COUNTY, TEXAS.
EACH PLEDGOR HEREBY IRREVOCABLY (I) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF
SUCH COURTS, AND (II) WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH ACTION OR PROCEEDING BROUGHT IN SUCH COURT OR THAT SUCH
COURT IS AN INCONVENIENT FORUM. EACH PLEDGOR AGREES THAT SERVICE OF PROCESS UPON
IT MAY BE MADE BY CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED, AT ITS
ADDRESS SPECIFIED OR DETERMINED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 6.4
OF THIS AGREEMENT. NOTHING IN THIS AGREEMENT OR ANY OTHER INSTRUMENT OR
AGREEMENT SECURING, EVIDENCING, OR RELATING TO THE OBLIGATIONS OR ANY PART
THEREOF SHALL AFFECT THE RIGHT OF THE AGENT, THE DOCUMENTATION AGENT, THE BANKS,
AND THE ISSUING BANKS TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
SHALL LIMIT THE RIGHT OF THE AGENT TO BRING ANY ACTION OR PROCEEDING AGAINST ANY
PLEDGOR OR WITH RESPECT TO ANY OF ITS PROPERTY IN COURTS IN OTHER JURISDICTIONS.
ANY ACTION OR PROCEEDING BY ANY PLEDGOR AGAINST THE AGENT, THE DOCUMENTATION
AGENT, THE BANKS, AND THE ISSUING BANKS SHALL BE BROUGHT ONLY IN A COURT LOCATED
IN DALLAS COUNTY, TEXAS.
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 12
Section 6.6 HEADINGS. The headings, captions, and arrangements used in
this Agreement are for convenience only and shall not affect the interpretation
of this Agreement.
Section 6.7 SURVIVAL. All representations and warranties made in this
Agreement shall survive the execution and delivery of this Agreement, and no
investigation by the Agent, the Documentation Agent or any Bank or Issuing Bank
shall affect the representations and warranties of any Pledgor herein or the
right of the Agent, the Documentation Agent, the Banks and the Issuing Banks to
rely upon them.
Section 6.8 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
Section 6.9 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Agreement, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
Section 6.10 CONSTRUCTION. Each Pledgor and the Agent acknowledge that
each of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement with its legal counsel and that
this Agreement shall be construed as if jointly drafted by such Pledgor and the
Agent.
Section 6.11 OBLIGATIONS ABSOLUTE. The obligations of each Pledgor under
this Agreement shall be absolute and unconditional and shall not be released,
discharged, reduced, or in any way impaired by any circumstance whatsoever,
including, without limitation, any amendment, modification, extension, or
renewal of this Agreement, the Obligations, or any document or instrument
evidencing, securing, or otherwise relating to the Obligations, or any release,
subordination, or impairment of collateral, or any waiver, consent, extension,
indulgence, compromise, settlement, or other action or inaction in respect of
this Agreement, the Obligations, or any document or instrument evidencing,
securing, or otherwise relating to the Obligations, or any exercise or failure
to exercise any right, remedy, power, or privilege in respect of the
Obligations.
Section 6.12 RELEASE OF SECURITY INTEREST. At such time as all of the
Obligations have been paid and performed in full, all obligations and
commitments of the Banks and the Issuing Banks to make advances, issue letters
of credit or otherwise extend credit under the Credit Agreement have expired or
terminated, and no Letters of Credit remain outstanding, the Agent shall release
the security interest granted hereby.
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 13
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first written above.
PLEDGORS:
HEALTHCOR HOLDINGS, INC.
By:S. βββββ ββββββ
Chairman of the Board
Address for Notices:
ββββ βββββ βββββββ ββββββββββ
βββββ β-ββββ
ββββββ, βββββ βββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: S. βββββ ββββββ
AGENT:
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION,
as Agent
By:ββββββ β. ββββββββ
Vice President
Address for Notices:
ββββ ββββ ββββββ
ββββ ββββββ βββ ββββββ
ββββββ, βββββ βββββ-ββββ
Fax No.: (βββ) βββ-ββββ
Telephone No.: (βββ) βββ-ββββ
Attention: ββββββ β. ββββββββ
DA962190392
121296 v16
255:13312-244
AMENDED AND RESTATED PLEDGE AGREEMENT - Page 14
SCHEDULE I
NUMBER
TYPE OF OF CERTIFICATE
PLEDGOR COMPANY STOCK SHARES NUMBER(S)
Healthcor Holdings, HealthCor, Inc. Common 1,000 001
Inc. HealthCor Pharmacy, Inc. Common 1,000 1
Physicians Home Health
Network, Inc. Common 1,000 05
HealthCor Oxygen and
Medical Equipment, Inc. Common 400 1
HealthCor Rehabilitation
Services, Inc. Common 100 1
HC Personnel
Resources, Inc. Common 1,000 01
SCHEDULE I TO AMENDED AND RESTATED PLEDGE AGREEMENT- Solo Page
EXHIBIT "G"
ASSIGNMENT OF DEPOSIT ACCOUNTS
ASSIGNMENT OF DEPOSIT ACCOUNTS
THIS ASSIGNMENT OF DEPOSIT ACCOUNTS (this "Assignment") is executed as of
October 31, 1996 by the parties signatory hereto (although more than one,
"ASSIGNOR") to TEXAS COMMERCE BANK NATIONAL ASSOCIATION, a national banking
association, as Agent ("ASSIGNEE"), whose address is 2200 ββββ Avenue, Post
Office Box 660197, Dallas, ββββββ ββββββ, βββββ βββββ-ββββ pursuant to that
certain Amended and Restated Credit Agreement dated of even date herewith among
HealthCor, Inc. (the "Company"), HealthCor Holdings, Inc. ("Holdings," and
together with the Company, the "Borrowers"), The First National Bank of Chicago,
as documentation agent (the "Documentation Agent"), the lenders from time to
time party thereto (collectively, the "Banks"), the Banks that from time to time
issue letters of credit thereunder (in such capacity, the "Issuing Banks"), and
Assignee, as agent for itself, the Documentation Agent, the Banks and the
Issuing Banks (such credit agreement as the same may be amended or otherwise
modified is referred to as the "Credit Agreement"). In consideration of the
extensions of credit made or to be made or other financial accommodations
afforded or to be afforded to the Borrowers by the Banks and the Issuing Banks
pursuant to the Credit Agreement, Assignor does hereby assign and transfer to
and pledge with Assignee all right, title, and interest of Assignor in and to
the following accounts:
================================================================================
ASSIGNOR LOCKBOX NO. ACCOUNT NO. INSTITUTION
--------------------------------------------------------------------------------
HealthCor Oxygen Medical Texas Commerce Bank
Equipment, Inc. 911437 088 05 129 721 National Association
--------------------------------------------------------------------------------
HealthCor, Inc. 911556 074 019 132 35 Texas Commerce Bank
National Association
================================================================================
together with all instruments, documents, and other writings evidencing the same
and all sums now or at any time hereafter on deposit therein, all sums due or to
become due thereon, and all extensions or renewals thereof, if the account or
accounts may be extended or renewed (collectively, the "ACCOUNT"), and Assignor
does also hereby grant to Assignee for the benefit of itself, the Documentation
Agent, the Banks and the Issuing Banks, a security interest in the Account,
which security interest may also be evidenced by one or more other security
agreements between Assignor and Assignee, and in the event of any conflict
between the terms hereof and the terms thereof, the terms thereof will apply.
Such security interest extends to any payment, renewal, or other proceeds of the
Account.
This assignment is made as and shall constitute collateral security for
any and all indebtedness and liabilities of any kind and nature of Assignor to
Assignee, the Documentation Agent, the Banks and the Issuing Banks under the
Credit Agreement, howsoever evidenced, whether now existing or hereafter
arising, direct or indirect, absolute, contingent, joint, several, or joint and
several (the "OBLIGATION").
ASSIGNMENT OF DEPOSIT ACCOUNTS - Page 1
Upon default in the payment of the Obligation or any part thereof,
Assignee is hereby authorized to apply all or any portion of the funds
represented by the Account to the payment of the Obligation and to withdraw
funds for such purpose at such times and in such amounts as it shall in its
discretion determine.
Assignor hereby constitutes and appoints Assignee the true and lawful
attorney of Assignor, with full power of substitution, to ask, demand, collect,
receive, receipt for, βββ for, compound, and give acquittance for any and all
amounts which may be or become due or payable under the Account, to execute any
and all withdrawal receipts or other orders for the payment of money drawn on
the Account, to endorse the name of Assignor on all commercial paper given in
payment or in part payment thereof, and, in its discretion, to file any claim or
take any other action or proceeding, either in its own name or in the name of
Assignor or otherwise, which Assignee may deem necessary or appropriate to
protect and preserve the right, title and interest of Assignee, the
Documentation Agent, the Banks and the Issuing Banks hereunder, and without
limiting the foregoing, Assignee shall have and is hereby given full power and
authority to transfer the Account into the name of Assignee or its nominee.
Assignor represents and warrants that (a) the Account is genuine and
represents in all respects what it purports to be, (b) Assignor is the owner
thereof free and clear of all liens and encumbrances of any nature whatsoever,
(c) Assignor will not create any other security interest in, mortgage, or
otherwise assign the Account or any part thereof, (d) that any funds payable
with respect to the Account that are received by Assignor shall immediately upon
such receipt become subject to the lien hereof and be segregated from all other
funds of Assignor and be held in trust for Assignee, the Documentation Agent,
the Banks and the Issuing Banks and be immediately paid into the Account, and
(e) Assignor has full powers, right and authority to execute and deliver this
assignment.
THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES
AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN OR ORAL AGREEMENTS AMONG
THE PARTIES.
ASSIGNMENT OF DEPOSIT ACCOUNTS - Page 2
EXECUTED as of the date first above written.
ASSIGNOR:
HEALTHCOR, INC.
HEALTHCOR HOLDINGS, INC.
HEALTHCOR OXYGEN AND
MEDICAL EQUIPMENT, INC.
HEALTHCOR REHABILITATION
SERVICES, INC.
HC PERSONNEL RESOURCES, INC.
By:S. βββββ ββββββ
Chairman of the Board
HEALTHCOR PHARMACY, INC.
PHYSICIANS HOME HEALTH NETWORK, INC.
By:ββββββ β. ββββββ
Chief Executive Officer, President and
Secretary
ASSIGNMENT OF DEPOSIT ACCOUNTS - Page 3
EXHIBIT "H"
CONTRIBUTION AND INDEMNIFICATION AGREEMENT
CONTRIBUTION AND INDEMNIFICATION AGREEMENT
THIS CONTRIBUTION AND INDEMNIFICATION AGREEMENT (this "Agreement") dated
as of October 31, 1996, among HEALTHCOR HOLDINGS, INC., a Delaware corporation
("Holdings"), HEALTHCOR, INC., a Delaware corporation ("HealthCor," and together
with Holdings, the "Borrowers"), and the other parties signatory hereto (such
other
parties being herein each called an "Affiliate" and collectively called the
"Affiliates", and together with HealthCor and Holdings, each a "Company" and
collectively the "Companies").
R E C I T A L S:
A. HealthCor, Holdings, Texas Commerce Bank National Association, a
national banking association, as agent (in such capacity, the "Agent"), The
First National Bank of Chicago, as documentation agent (the "Documentation
Agent"), certain banks (collectively, the "Banks") and certain Banks issuing
letters of credit thereunder (in such capacity, the "Issuing Banks") have
entered into an Amended and Restated Credit Agreement of even date herewith (as
the same may hereafter be amended, supplemented or modified from time to time,
the "Credit Agreement"), pursuant to which the Banks and the Issuing Banks have
agreed to make certain loans and extensions of credit to the Borrowers.
B. Each Affiliate has executed and delivered to the Agent the Subsidiary
Guaranty Agreement of even date herewith (the "Subsidiary Guaranty"), pursuant
to which such Affiliate has jointly and severally guaranteed the full and prompt
payment and performance of the Guaranteed Indebtedness (as defined in the
Subsidiary Guaranty);
C. Each of the Borrowers has executed and delivered to the Agent the
Borrower Guaranty Agreement of even date herewith (the "Borrower Guaranty"),
pursuant to which such Borrower has jointly and severally guaranteed the full
and prompt payment and performance of the other Borrower's obligations under the
Credit Agreement; and
D. The parties wish to enter into this Agreement to effect an equitable
sharing of the Affiliates' risk in guaranteeing the Guaranteed Indebtedness.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. If any Affiliate makes a payment in respect of the Guaranteed
Indebtedness, it shall have the rights of contribution and reimbursement set
forth below against the other Companies and the Borrowers and shall be
indemnified as set forth below; PROVIDED that no Affiliate shall enforce its
rights to any payment by exercising its rights of contribution, reimbursement or
indemnification until all the Guaranteed Indebtedness shall have been paid in
full.
CONTRIBUTION AND INDEMNIFICATION AGREEMENT - Page 1
2. If any Affiliate makes a payment in respect of the Guaranteed
Indebtedness that is greater than its Pro Rata Percentage (hereinafter defined)
of the Guaranteed Indebtedness, calculated as of the date such payment is made,
the Affiliate making such payment shall have the right to receive from each of
the other Companies, and the other Companies jointly and severally agree to pay
to such Affiliate, when permitted by paragraph 1 hereof, an amount such that the
net payments made by the Companies in respect of the Guaranteed Indebtedness
shall be shared among the Companies pro rata in proportion to their respective
Pro Rata Percentage of the Guaranteed Indebtedness. The Companies hereby jointly
and severally indemnify each of the Affiliates and jointly and severally agree
to hold each of them harmless from and against any and all amounts which any
such Affiliate shall ever be required to pay in respect of the Guaranteed
Indebtedness in excess of such Affiliate's respective Pro Rata Percentage of the
Guaranteed Indebtedness. Notwithstanding anything to the contrary contained in
this paragraph or in this Agreement, no liability or obligation of any Company
that shall accrue pursuant to this Agreement shall be paid nor shall it be
deemed owed pursuant to this Agreement or any Loan Documents until all of the
Guaranteed Indebtedness shall be paid in full. As used herein, the term "Pro
Rata Percentage" shall mean, for each Company, the percentage derived by
dividing (a) the aggregate amount of all accounts receivable of such Company, by
(b) the total aggregate amount of all accounts receivable of all of the
Companies.
3. If any Affiliate makes any payment in respect of the Guaranteed
Indebtedness, the Affiliate making such payment shall have the right to receive
from the Borrowers, and the Borrowers agree to pay to such Affiliate, when
permitted by paragraph 1 hereof, an amount equal to such payment. Each of the
Borrowers hereby indemnifies each of the Affiliates and agrees to hold each of
them harmless from and against any and all amounts that any such Affiliate shall
ever be required to pay in respect of the Guaranteed Indebtedness.
Notwithstanding anything to the contrary contained in this paragraph or in this
Agreement, no liability or obligation of the Borrowers that shall accrue
pursuant to this Agreement shall be paid or shall be deemed owed pursuant to
this Agreement or any Loan Documents until all of the Guaranteed Indebtedness
shall be paid in full.
4. Each party hereto represents and warrants to each other party hereto
and to their respective successors and assigns that:
(a) the execution, delivery and performance by each party hereto of this
Agreement are within such party's corporate or partnership powers, have been
duly authorized by all necessary corporate or partnership action, as the case
may be, require no action by or in respect of, or filing with, any governmental
body, agency or official and do not contravene, or constitute a default under,
any provision of applicable law or regulation or of the certificate of
incorporation or bylaws or other organizing document of such party or of any
agreement, judgment, injunction, order, decree or other instrument binding upon
such party or result in the creation or imposition of any lien, security
interest or other charge or encumbrance on any asset of such party; and
CONTRIBUTION AND INDEMNIFICATION AGREEMENT - Page 2
(b) this Agreement constitutes a legal, valid and binding agreement of
each party hereto, enforceable against such party in accordance with its terms.
5. No failure or delay by any Company in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and non-exclusive of any rights or remedies
provided by law.
6. Any provision of this Agreement may be amended or waived if, but only
if, such amendment or waiver is in writing and is signed by the parties hereto
and consented to by the Agent and the Required Banks.
7. The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
8. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS.
9. This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Agreement shall become effective
when a counterpart hereof shall have been signed by all the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the date first above
written.
HEALTHCOR HOLDINGS, INC.
HEALTHCOR, INC.
HEALTHCOR OXYGEN AND MEDICAL
EQUIPMENT, INC.
HEALTHCOR REHABILITATION SERVICES,
INC.
HC PERSONNEL RESOURCES, INC.
By:S. βββββ ββββββ
Chairman of the Board of each of the
above Companies
CONTRIBUTION AND INDEMNIFICATION AGREEMENT - Page 3
HEALTHCOR PHARMACY, INC.
PHYSICIANS HOME HEALTH NETWORK, INC.
By:ββββββ β. ββββββ
Chief Executive Officer, President and
Secretary of each of the above Companies
CONTRIBUTION AND INDEMNIFICATION AGREEMENT - Page 4
EXHIBIT "I"
MATTERS TO BE ADDRESSED IN OPINION OF COUNSEL
All capitalized terms used and not otherwise defined herein shall have
their respective meanings as set forth in the Amended and Restated Credit
Agreement to which this is an Exhibit (the "Credit Agreement").
1. Each Company is a corporation duly organized, validly existing,
and in good standing under the laws of the state of its incorporation.
Except where failure would not have a material adverse effect on its
business, condition (financial or otherwise), operations, prospects, or
properties, each Company is duly qualified to transact business as a
foreign corporation in each jurisdiction where such Company conducts any
substantial business or has any property, which includes, without
limitation, those jurisdictions named for each Company on Schedule 1 to
the Credit Agreement.
2. Each Borrower has the corporate power and authority to execute,
deliver, and perform the Credit Agreement, the Notes, and the other Loan
Documents to which such Borrower is a party. The execution, delivery, and
performance by each Borrower of the Credit Agreement, the Notes, and the
other Loan Documents to which such Borrower is a party and compliance with
the terms and provisions thereof have been duly authorized by all
requisite corporate action on the part of such Borrower and do not and
will not (a) violate or conflict with, or result in a breach of, or
require any consent under (i) the certificate of incorporation or bylaws
of such Borrower, (ii) any applicable law, rule, or regulation or any
order, writ, injunction, or decree of any Governmental Authority or
arbitrator, or (iii) any agreement or instrument to which such Borrower is
a party or by which such Borrower or any of its properties is bound or
subject, or (b) constitute a default under any such agreement or
instrument, or result in the creation or imposition of any Lien (except
Liens created in favor of the Agent for the benefit of itself, the
Documentation Agent, the Banks, and the Issuing Banks pursuant to the Loan
Documents) upon any of the revenues or assets of such Borrower.
3. Each Guarantor has the corporate power and authority to execute,
deliver, and perform the Guaranty to which it is a party (the "Subsidiary
Guaranty") and each of the other Loan Documents to which such Guarantor is
a party. The execution, delivery, and performance by the Guarantors of the
Subsidiary Guaranty and each of the other Loan Documents to which such
Guarantor is a party and compliance with the terms and provisions thereof
have been duly authorized by all requisite corporate action on the part of
such Guarantor and do not and will not (a) violate or conflict with, or
result in a breach of, or require any consent under (i) the articles or
certificate of incorporation or bylaws of such Guarantor, (ii) any
applicable law, rule, or regulation or any order, writ, injunction, or
decree of any Governmental Authority or arbitrator, or (iii) any agreement
or instrument to which such Guarantor is a party or by which it or any of
its property is bound or subject, or (b) constitute a default under any
such agreement or instrument, or result in the creation or imposition of
any Lien (except Liens created in favor of the Agent for the benefit of
itself, the Documentation Agent, the Banks and the Issuing Banks pursuant
to the Loan Documents) upon any of the revenues or assets of such
Guarantor.
MATTERS TO BE ADDRESSED IN OPINION OF COUNSEL - Page 1
4. The Credit Agreement, the Notes, and the other Loan Documents to
which either Borrower is a party have been duly executed and delivered by
such Borrower and constitute the legal, valid, and binding obligations of
such Borrower enforceable against such Borrower in accordance with their
respective terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, or other similar laws
affecting the enforcement of creditors' rights generally.
5. The Subsidiary Guaranty and each of the other Loan Documents to
which each Guarantor is a party have been duly executed and delivered by
each Guarantor and constitute the legal, valid, and binding obligations of
each Guarantor enforceable against such Guarantor in accordance with their
respective terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, or other similar laws
affecting the enforcement of creditors' rights generally.
6. There are no legal or arbitral proceedings and no proceedings by
or before any Governmental Authority, pending or, to our knowledge,
threatened against or affecting either Borrower, any Guarantor or any
properties or rights of either Borrower or any Guarantor, which if
adversely determined, would have a material adverse effect on the
business, condition (financial or otherwise), operations, prospects, or
properties of either Borrower or any Guarantor.
7. No authorization, consent, or approval of, or filing or
registration with, any Governmental Authority is required for the
execution, delivery, and performance by either Borrower of the Credit
Agreement, the Notes or any other Loan Documents to which either Borrower
is a party, or the execution, delivery, and performance by any Guarantor
of the Subsidiary Guaranty or any other Loan Document to which such
Guarantor is a party.
8. All of the shares of capital stock of each issuer of stock
pledged pursuant to the Pledge Agreement (the "Pledged Stock") have been
duly authorized and validly issued and are fully paid and nonassessable.
None of the shares of capital stock of any issuer of the Pledged Stock are
subject to any restriction on transfer or assignment, except compliance
with applicable securities laws and regulations.
9. None of the Companies is an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
10. To our knowledge, after reasonable investigation, the proceeds
of the Loans under the Credit Agreement are not intended to be used
directly or indirectly for the purpose of purchasing or carrying, or for
the purpose of extending credit to others for the purpose of purchasing or
carrying, any "margin stock" as that term is defined in Regulation U of
the Board of Governors of the Federal Reserve System, as amended.
MATTERS TO BE ADDRESSED IN OPINION OF COUNSEL - Page 2
EXHIBIT "J"
FORM OF ASSIGNMENT AND ACCEPTANCE
ASSIGNMENT AND ACCEPTANCE
Dated _____________, 19__
Reference is hereby made to the Amended and Restated Credit Agreement
dated as of October 31, 1996 (as the same may be amended and in effect from time
to time, the "Credit Agreement"), among HEALTHCOR, INC., a Delaware corporation,
HEALTHCOR HOLDINGS, INC., a Delaware corporation (collectively, "the
Borrowers"), the lenders from time to time party thereto (the "Banks"), Texas
Commerce Bank National Association, as an issuing bank (in such capacity, an
"Issuing Bank"), THE FIRST NATIONAL BANK OF CHICAGO, as documentation agent (the
"Documentation Agent"), and TEXAS COMMERCE BANK NATIONAL ASSOCIATION, as agent
for itself, the Documentation Agent, the Issuing Banks and the other Banks (in
such capacity, the "Agent"). Capitalized terms used herein and not otherwise
defined shall have the meanings assigned to such terms in the Credit Agreement.
________________________ (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 the Assignor's rights and obligations under the Credit
Agreement and the other Loan Documents as of the Effective Date (as
defined below) (including, without limitation, such percentage interest in
the Revolving Credit Commitment and the Acquisition Line Commitment of the
Assignor on the Effective Date and such percentage interest in Assignor's
pro rata interest in the Acquisition Line Loans and Revolving Credit Loans
and pro rata participation interests in the Letter of Credit Liabilities
outstanding on the Effective Date together with such percentage interest
in all unpaid interest and fees accrued from the Effective Date). This
Assignment and Acceptance is made by Assignor without recourse.
2. The Assignor (i) represents that as of the date hereof its Revolving
Credit Commitment is equal to $_______________, the outstanding principal
balance of its Revolving Credit Loans is $______________, its Acquisition
Line Commitment is equal to $______________, the outstanding principal
balance of its Acquisition Line Loans is $_____________, and its
participation in outstanding Letters of Credit is $______________ (all as
unreduced by any assignments which have not yet become effective); (ii)
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 any other Loan Document or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other Loan Document, other than 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;
(iii) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrowers or any Obligated
Party or the performance or observance by the Borrowers or any other
Obligated Party of any of their obligations under the
ASSIGNMENT AND ACCEPTANCE - Page 1
Agreement or any other Loan Document; and (iv) attaches the Notes held by
Assignor and requests that the Agent exchange such Notes for new Notes
payable to the order of (a) the Assignee and in the case of the Revolving
Credit Note, in an amount equal to the Revolving Credit Commitment assumed
by the Assignee pursuant hereto, and in the case of the Acquisition Line
Notes, in an amount equal to the outstanding principal amount of the
Acquisition Line Loans purchased under each Acquisition Line Note, and (b)
the Assignor and in the case of the Revolving Credit Note, in an amount
equal to the Revolving Credit Commitment retained by the Assignor under
the Credit Agreement, and in the case of the Acquisition Line Notes, in an
amount equal to the outstanding principal amount of the Acquisition Line
Loans under each Acquisition Line Note, retained thereby, respectively, as
specified above.
3. The Assignee (a) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (b) confirms that it has
received a copy of the Credit Agreement, together with copies of the most
recent financial statements delivered pursuant to Section 10.1(a) 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; (c) agrees that it will, independently and without
reliance upon the Agent, the Documentation Agent, the Assignor, any
Issuing Bank, or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit
Agreement and the other Loan Documents; (d) confirms that it is eligible
to be an Assignee; (e) appoints and authorizes Texas Commerce Bank
National Association 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; (f) agrees that it will perform in accordance with
their terms all 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] (g) agrees that it will keep confidential all information with
respect to the Borrowers or any Obligated Party furnished to it by the
Borrowers or any Obligated Party or the Assignor (other than information
generally available to the public or otherwise available to the Assignor
on a nonconfidential basis) [; and (h) attaches the forms prescribed by
the Internal Revenue Service of the United States certifying as to the
Assignee's exemption from United States withholding taxes with respect to
all payments to be made to the Assignee under the Loan Documents or such
other documents as are necessary to indicate that all such payments are
subject to such tax at a rate reduced by an applicable tax treaty].1
4. The effective date for this Assignment and Acceptance shall be
______________, 19__ (the "Effective Date").2 Following the execution of
this Assignment and Acceptance, it will be delivered to the Agent for its
acceptance and recording.
--------
1 If the Assignee is organized under the laws of a jurisdiction
outside the United States.
2 Such date shall be at least ten (10) Business Days after the
execution of this Assignment and Acceptance and delivery thereof to
the Agent.
ASSIGNMENT AND ACCEPTANCE - Page 2
5. Upon such acceptance and recording, from and after the Effective Date, (i)
the Assignee shall be a party to the Credit Agreement and, to the extent
provided in this Assignment and Acceptance, shall have the rights and
obligations of a Bank thereunder and under the other Loan Documents 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 and the other Loan Documents.
6. Upon such acceptance and recording, from and after the Effective Date, the
Agent shall make all payments in respect of the interest assigned hereby
(including payments of principal, interest, fees, and other amounts) to
the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments for periods prior to the Effective Date by the
Agent or with respect to the making of this assignment directly between
themselves.
7. This Assignment and Acceptance shall be governed by, and construed in
accordance with, the laws of the State of Texas and applicable laws of the
United States of America.
[NAME OF ASSIGNOR],
ORIGINAL
REVOLVING CREDIT COMMITMENT: By:
Name:
$ Title:
EFFECTIVE DATE
REVOLVING CREDIT COMMITMENT:
$
ORIGINAL ACQUISITION
LINE COMMITMENT:
$
EFFECTIVE DATE
ACQUISITION LINE COMMITMENT:
$
AMOUNT OF EACH ACQUISITION
LINE NOTE AS OF EFFECTIVE DATE:
$
$
ASSIGNMENT AND ACCEPTANCE - Page 3
[NAME OF ASSIGNEE],
REVOLVING CREDIT COMMITMENT: By:
Name:
$ Title:
ACQUISITION LINE COMMITMENT:
$
AMOUNT OF EACH
ACQUISITION LINE NOTE:
$
$
Accepted on the _____ day of __________, 19__.
TEXAS COMMERCE BANK
NATIONAL ASSOCIATION,
as agent for itself, the Documentation
Agent, the other Issuing Banks
and the other Banks
By:
Name:
Title:
ASSIGNMENT AND ACCEPTANCE - Page 4