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EXHIBIT 4.6
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PARTICIPATION AGREEMENT
Dated as of March 30, 1998
among
PROVINCE HEALTHCARE COMPANY
as the Construction Agent and as the Lessee,
THE VARIOUS PARTIES HERETO
FROM TIME TO TIME,
as the Guarantors,
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as the Owner Trustee
under the PHC Real Estate Trust 1998-1,
THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES HERETO FROM
TIME TO TIME, as the Holders,
THE VARIOUS BANKS AND OTHER LENDING INSTITUTIONS WHICH ARE PARTIES HERETO FROM
TIME TO TIME, as the Lenders,
and
FIRST UNION NATIONAL BANK,
as the Agent for the Lenders
and respecting the Security Documents,
as the Agent for the Lenders and the Holders,
to the extent of their interests
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TABLE OF CONTENTS
Page
SECTION 1. THE LOANS.............................................................................................1
SECTION 2. HOLDER ADVANCES.......................................................................................2
SECTION 3. SUMMARY OF TRANSACTIONS...............................................................................2
3.1. Operative Agreements................................................................................2
3.2. Property Purchase...................................................................................2
3.3. Construction of Improvements; Lease or Disposition of Property......................................3
SECTION 4. THE CLOSINGS..........................................................................................3
4.1. Initial Closing Date................................................................................3
4.2. Initial Closing Date; Property Closing Dates; Acquisition Advances; Construction Advances...........3
SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT; REPORTING REQUIREMENTS ON COMPLETION DATE; THE LESSEE'S
DELIVERY OF NOTICES; RESTRICTIONS ON LIENS............................................................4
5.1. General.............................................................................................4
5.2. Procedures for Funding..............................................................................4
5.3. Conditions Precedent for the Lessor, the Agent, the Lenders and the Holders Relating to the Initial
Closing Date and the Advance of Funds for the Acquisition of a Property.............................6
5.4. Conditions Precedent for the Lessor, the Agent, the Lenders and the Holders Relating to the Advance
of Funds after the Acquisition Advance.............................................................11
5.5. Additional Reporting and Delivery Requirements on Completion Date and on Construction Period
Termination Date...................................................................................13
5.6. The Construction Agent Delivery of Construction Budget Modifications...............................14
5.7. Restrictions on Liens..............................................................................14
5.8. Punch List Items...................................................................................14
5.9. Joinder Agreement Requirements.....................................................................14
SECTION 6. REPRESENTATIONS AND WARRANTIES.......................................................................15
6.2. Representations and Warranties of the Borrower.....................................................15
6.3. Representations and Warranties of Each Credit Party................................................18
SECTION 6B. GUARANTY............................................................................................23
6B.1. Guaranty of Payment and Performance...............................................................23
6B.2. Obligations Unconditional.........................................................................23
6B.3. Modifications.....................................................................................24
6B.4. Waiver of Rights..................................................................................24
6B.5. Reinstatement.....................................................................................25
6B.6. Remedies..........................................................................................25
6B.7. Limitation of Guaranty............................................................................25
6B.8. Payment of Amounts to the Agent...................................................................26
6B.9. Release of Guarantors.............................................................................26
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SECTION 7. PAYMENT OF CERTAIN EXPENSES...........................................................................26
7.1. Transaction Expenses...............................................................................26
7.2. [Intentionally Omitted]............................................................................27
7.3. Certain Fees and Expenses..........................................................................28
7.4. Facility Fee.......................................................................................28
SECTION 8. OTHER COVENANTS AND AGREEMENTS.......................................................................28
8.1. Cooperation with the Construction Agent or the Lessee..............................................28
8.2. Covenants of the Owner Trustee and the Holders.....................................................29
8.3. Credit Party Covenants, Consent and Acknowledgment.................................................30
8.4. Sharing of Certain Payments........................................................................34
8.5. Grant of Easements, etc............................................................................34
8.6. Appointment by the Agent, the Lenders, the Holders and the Owner Trustee...........................35
8.7. Collection and Allocation of Payments and Other Amounts............................................35
8.8. Release of Properties, etc.........................................................................39
SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT.................................................................39
9.1. The Construction Agent's and the Lessee's Credit Agreement Rights..................................39
9.2. The Construction Agent's and the Lessee's Trust Agreement Rights...................................40
SECTION 10. TRANSFER OF INTEREST................................................................................40
10.1. Restrictions on Transfer..........................................................................40
10.2. Effect of Transfer................................................................................41
SECTION 11. INDEMNIFICATION.....................................................................................41
11.1. General Indemnity.................................................................................41
11.2. General Tax Indemnity.............................................................................44
11.3. Increased Costs, Illegality, etc..................................................................47
11.4. Funding/Contribution Indemnity....................................................................49
11.5. Withholding Taxes.................................................................................49
11.6. Replacement of Lenders and Holders................................................................52
11.7. EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT LIABILITY, ETC............................53
SECTION 12. MISCELLANEOUS.......................................................................................54
12.1. Survival of Agreements............................................................................54
12.2. No Broker, etc....................................................................................54
12.3. Notices...........................................................................................54
12.4. Counterparts......................................................................................56
12.5. Terminations, Amendments, Waivers, Etc.; Unanimous Vote Matters...................................56
12.6. Headings, etc.....................................................................................58
12.7. Parties in Interest...............................................................................58
12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL; VENUE; ARBITRATION...............58
12.9. Severability......................................................................................60
12.10. Liability Limited................................................................................60
12.11. Rights of the Credit Parties.....................................................................62
12.12. Further Assurances...............................................................................62
12.13. Calculations under Operative Agreements..........................................................62
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12.14. Confidentiality..................................................................................62
12.15. Financial Reporting/Tax Characterization.........................................................64
12.16. Set-off..........................................................................................64
EXHIBITS
A Requisition Form (Sections 4.2, 5.2, 5.3 and 5.4)
B Outside Counsel Opinion for the Lessee (Section 5.3(j))
C [Intentionally Omitted]
D Officer's Certificate (Section 5.3(aa))
E Officer's Certificate (Section 5.3(bb))
F Officer's Certificate (Section 5.3(dd))
G Officer's Certificate (Section 5.3(ee))
H Legal Opinion of Owner Trustee's Counsel (Section 5.3(ff))
I Outside Counsel Opinion for the Lessee (Section 5.3(gg))
J Officer's Certificate (Section 5.5)
K Description of Material Litigation (Section 6.3(d))
L Compliance Certificate
M Form of Joinder Agreement (Section 5.9)
N States of Incorporation/Formation and Principal Place of
Business of Each Guarantor (Section 6.3(i))
Appendix A Rules of Usage and Definitions
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PARTICIPATION AGREEMENT
THIS PARTICIPATION AGREEMENT dated as of March 30, 1998 (as amended,
modified, extended, supplemented, restated and/or replaced from time to time,
this "Agreement") is by and among PROVINCE HEALTHCARE COMPANY a Delaware
corporation (the "Lessee" or the "Construction Agent"); the various parties
hereto from time to time as guarantors (subject to the definition of Guarantors
in Appendix A hereto, individually, a "Guarantor" and collectively, the
"Guarantors"); FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking
association, not individually (in its individual capacity, the "Trust Company"),
except as expressly stated herein, but solely as the Owner Trustee under the PHC
Real Estate Trust 1998-1 (the "Owner Trustee", the "Borrower" or the "Lessor");
the various banks and other lending institutions which are parties hereto from
time to time as lenders (subject to the definition of Lenders in Appendix A
hereto, individually, a "Lender" and collectively, the "Lenders"); FIRST UNION
NATIONAL BANK, a national banking association, as the agent for the Lenders and
respecting the Security Documents, as the agent for the Lenders and the Holders,
to the extent of their interests (in such capacity, the "Agent"); the various
banks and other lending institutions which are parties hereto from time to time
as holders of certificates issued with respect to the PHC Real Estate Trust
1998-1 (subject to the definition of Holders in Appendix A hereto, individually,
a "Holder" and collectively, the "Holders"). Capitalized terms used but not
otherwise defined in this Agreement shall have the meanings set forth in
Appendix A hereto.
In consideration of the mutual agreements herein contained and other
good and valuable consideration, the receipt of which is hereby acknowledged,
the parties hereto hereby agree as follows:
SECTION 1. THE LOANS.
Subject to the terms and conditions of this Agreement and in reliance
on the representations and warranties of each of the parties hereto contained
herein or made pursuant hereto, the Lenders have agreed to make Loans to the
Lessor from time to time in an aggregate principal amount of up to the aggregate
amount of the Commitments of the Lenders in order for the Lessor to acquire the
Properties and certain Improvements, to develop and construct certain
Improvements in accordance with the Agency Agreement and the terms and
provisions hereof, to construct Modifications and for the other purposes
described herein, and in consideration of the receipt of proceeds of the Loans,
the Lessor will issue the Notes. The Loans shall be made and the Notes shall be
issued pursuant to the Credit Agreement. Pursuant to Section 5 of this Agreement
and Section 2 of the Credit Agreement, the Loans will be made to the Lessor from
time to time at the request of (a) the Construction Agent in consideration for
the Construction Agent agreeing for the benefit of the Lessor, pursuant to the
Agency Agreement, to acquire the Properties, to acquire the Equipment, to
construct certain Improvements and to cause the Lessee to lease the Properties,
each in accordance with the Agency Agreement and the other Operative Agreements
or (b) the Lessee in consideration for the Lessee agreeing for the benefit of
the
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Lessor, pursuant to the Lease, to construct Modifications in accordance with the
Lease and the other Operative Agreements. The Loans and the obligations of the
Lessor under the Credit Agreement shall be secured by the Collateral.
SECTION 2. HOLDER ADVANCES.
Subject to the terms and conditions of this Agreement and in reliance
on the representations and warranties of each of the parties hereto contained
herein or made pursuant hereto, on each date Advances are requested to be made
in accordance with Section 5 hereof, each Holder shall make a Holder Advance on
a pro rata basis to the Lessor with respect to the PHC Real Estate Trust 1998-1
based on its Holder Commitment in an amount in immediately available funds such
that the aggregate of all Holder Advances on such date shall be three percent
(3%) of the amount of the Requested Funds on such date; provided, that no Holder
shall be obligated for any Holder Advance in excess of its pro rata share of the
Available Holder Commitment. The aggregate amount of Holder Advances shall be up
to the aggregate amount of the Holder Commitments. No prepayment or any other
payment with respect to any Advance shall be permitted such that the Holder
Advance with respect to such Advance is less than three percent (3%) of the
outstanding amount of such Advance, except in connection with termination or
expiration of the Term or in connection with the exercise of remedies relating
to the occurrence of a Lease Event of Default. The representations, warranties,
covenants and agreements of the Holders herein and in the other Operative
Agreements are several, and not joint or joint and several.
SECTION 3. SUMMARY OF TRANSACTIONS.
3.1. OPERATIVE AGREEMENTS.
On the date hereof, each of the respective parties hereto and thereto
shall execute and deliver this Agreement, the Lease, each applicable Ground
Lease, the Agency Agreement, the Credit Agreement, the Notes, the Trust
Agreement, the Certificates, the Security Agreement, each applicable Mortgage
Instrument and such other documents, instruments, certificates and opinions of
counsel as agreed to by the parties hereto.
3.2. PROPERTY PURCHASE.
On each Property Closing Date and subject to the terms and conditions
of this Agreement (a) the Holders will each make a Holder Advance in accordance
with Sections 2 and 5 of this Agreement and the terms and provisions of the
Trust Agreement, (b) the Lenders will each make Loans in accordance with
Sections 1 and 5 of this Agreement and the terms and provisions of the Credit
Agreement, (c) the Lessor will purchase and acquire good and marketable title to
or ground lease pursuant to a Ground Lease, the applicable Property, each to be
within an Approved State, identified by the Construction Agent, in each case
pursuant to a Deed, ▇▇▇▇ of Sale or Ground Lease, as the case may be, and grant
the Agent a lien on such Property by execution of
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the required Security Documents, (d) the Agent, the Lessee and the Lessor shall
execute and deliver a Lease Supplement relating to such Property and (e) the
Term shall commence with respect to such Property.
3.3. CONSTRUCTION OF IMPROVEMENTS; LEASE OR DISPOSITION OF PROPERTY.
Construction Advances will be made with respect to particular
Improvements to be constructed and with respect to ongoing Work regarding the
Equipment and construction of particular Improvements, in each case, pursuant to
the terms and conditions of this Agreement, the Agency Agreement or Section
11.1(c) of the Lease. The Construction Agent (or, respecting Section 11.1(c) of
the Lease, the Lessee) will act as a construction agent on behalf of the Lessor
respecting the Work regarding the Equipment, the construction of such
Improvements (or, respecting Section 11.1(c) of the Lease, the Modifications)
and the expenditures of the Construction Advances related to the foregoing. The
Construction Agent shall promptly notify the Lessor upon Completion of the
Improvements and the Lessee shall commence to pay Basic Rent as of the Rent
Commencement Date. The Lessee shall promptly notify the Lessor upon completion
of each Modification.
SECTION 4. THE CLOSINGS.
4.1. INITIAL CLOSING DATE.
All documents and instruments required to be delivered on the Initial
Closing Date shall be delivered at the offices of ▇▇▇▇▇ & ▇▇▇ ▇▇▇▇▇, PLLC,
Charlotte, North Carolina, or at such other location as may be determined by the
Lessor, the Agent and the Lessee.
4.2. INITIAL CLOSING DATE; PROPERTY CLOSING DATES; ACQUISITION
ADVANCES; CONSTRUCTION ADVANCES.
The Construction Agent (or, respecting Section 11.1(c) of the Lease,
the Lessee) shall deliver to the Agent a requisition (a "Requisition"), in the
form attached hereto as EXHIBIT A or in such other form as is satisfactory to
the Agent, in its reasonable discretion, in connection with (a) the Transaction
Expenses and other fees, expenses and disbursements payable, pursuant to Section
7.1, by the Lessor and (b) each Acquisition Advance pursuant to Section 5.3 and
(c) each Construction Advance pursuant to Section 5.4.
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SECTION 5. FUNDING OF ADVANCES; CONDITIONS PRECEDENT;
REPORTING REQUIREMENTS ON COMPLETION DATE;
THE LESSEE'S DELIVERY OF NOTICES; RESTRICTIONS ON LIENS.
5.1. GENERAL.
(a) To the extent funds have been advanced to the Lessor as
Loans by the Lenders and to the Lessor as Holder Advances by the
Holders, the Lessor will use such funds from time to time in accordance
with the terms and conditions of this Agreement and the other Operative
Agreements (i) at the direction of the Construction Agent to acquire
the Properties in accordance with the terms of this Agreement, the
Agency Agreement and the other Operative Agreements, (ii) to make
Advances to the Construction Agent to permit the acquisition, testing,
engineering, installation, development, construction, modification,
design, and renovation, as applicable, of the Properties (or components
thereof) in accordance with the terms of the Agency Agreement and the
other Operative Agreements, (iii) to make Advances to the Lessee to
fund Modifications pursuant to Section 11.1(c) of the Lease and (iv) to
pay Transaction Expenses, fees, expenses and other disbursements
payable by the Lessor under Sections 7.1(a) and 7.1(b).
(b) In lieu of the payment of interest on the Loans and Holder
Yield on the Holder Advances on any Scheduled Interest Payment Date
with respect to any Property during the period prior to the Rent
Commencement Date with respect to such Property, (i) each Lender's Loan
shall automatically be increased by the amount of interest accrued and
unpaid on such Loan for such period (except to the extent that at any
time such increase would cause such Lender's Loan to exceed such
Lender's Available Commitment, in which case the Lessee shall pay such
excess amount to such Lender in immediately available funds on the date
such Lender's Available Commitment was exceeded), and (ii) each
Holder's Holder Advance shall automatically be increased by the amount
of Holder Yield accrued and unpaid on such Holder Advance for such
period (except to the extent that at any time such increase would cause
the Holder Advance of such Holder to exceed such Holder's Available
Holder Commitment, in which case the Lessee shall pay such excess
amount to such Holder in immediately available funds on the date the
Available Holder Commitment of such Holder was exceeded). Such
increases in a Lender's Loan and a Holder's Holder Advance shall occur
without any disbursement of funds by any Person.
5.2. PROCEDURES FOR FUNDING.
(a) The Construction Agent (or, respecting Section 11.1(c) of
the Lease, the Lessee) shall designate the date for Advances hereunder
in accordance with the terms and provisions hereof; provided, however,
it is understood and agreed that no more than two (2) Advances
(excluding any conversion and/or continuation of any Loans or Holder
Advances) may be requested during any calendar month. Not less than (i)
three (3) Business Days prior to the Initial Closing Date and (ii)
three (3) Business Days prior to
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the date on which any Acquisition Advance or Construction Advance is to
be made, the Construction Agent shall deliver to the Agent, (A) with
respect to the Initial Closing Date and each Acquisition Advance, a
Requisition as described in Section 4.2 hereof (including without
limitation a legal description of the Land, a schedule of the
Improvements, if any, and a schedule of the Equipment, if any, acquired
or to be acquired on such date, and a schedule of the Work, if any, to
be performed, each of the foregoing in a form reasonably acceptable to
the Agent) and (B) with respect to each Construction Advance, a
Requisition identifying (among other things) the Property to which such
Construction Advance relates.
(b) Each Requisition shall: (i) be irrevocable, (ii) request
funds in an amount that is not in excess of the total aggregate of the
Available Commitments plus the Available Holder Commitments at such
time, and (iii) request that the Holders make Holder Advances and that
the Lenders make Loans to the Lessor for the payment of Transaction
Expenses, Property Acquisition Costs (in the case of an Acquisition
Advance) or other Property Costs (in the case of a Construction
Advance) that have previously been incurred or are to be incurred on
the date of such Advance to the extent such were not subject to a prior
Requisition, in each case as specified in the Requisition.
(c) Subject to the satisfaction of the conditions precedent
set forth in Sections 5.3 or 5.4, as applicable, on each Property
Closing Date or the date on which the Construction Advance is to be
made, as applicable, (i) the Lenders shall make Loans based on their
respective Lender Commitments to the Lessor in an aggregate amount
equal to ninety-seven percent (97%) of the Requested Funds specified in
any Requisition (ratably between the Tranche A Lenders and the Tranche
B Lenders with the Tranche A Lenders funding eighty-five percent (85%)
of the Requested Funds and the Tranche B Lenders funding twelve percent
(12%) of the Requested Funds), up to an aggregate principal amount
equal to the aggregate of the Available Commitments, (ii) each Holder
shall make a Holder Advance based on its Holder Commitment in an amount
such that the aggregate of all Holder Advances at such time shall be
three percent (3%) of the balance of the Requested Funds specified in
such Requisition, up to the aggregate advanced amount equal to the
aggregate of the Available Holder Commitments; and (iii) the total
amount of such Loans and Holder Advances made on such date shall (x) be
used by the Lessor to pay Property Costs and/or Transaction Expenses
within three (3) Business Days of the receipt by the Lessor of such
Advance or (y) be advanced by the Lessor on the date of such Advance to
the Construction Agent or the Lessee to pay Property Costs, as
applicable. Notwithstanding that the Operative Agreements state that
Advances shall be directed to the Lessor, each Advance shall in fact be
directed to the Agent (for the benefit of the Lessor) and applied by
the Agent (for the benefit of the Lessor) pursuant to the requirements
imposed on the Lessor under the Operative Agreements.
(d) With respect to an Advance obtained by the Lessor to pay
for Property Costs and/or Transaction Expenses or other costs payable
under Section 7.1 hereof and not expended by the Lessor for such
purpose on the date of such Advance, such amounts
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shall be held by the Lessor (or the Agent on behalf of the Lessor)
until the applicable closing date or, if such closing date does not
occur within three (3) Business Days of the date of the Lessor's
receipt of such Advance, shall be applied regarding the applicable
Advance to repay the Lenders and the Holders and, subject to the terms
hereof, and of the Credit Agreement and the Trust Agreement, shall
remain available for future Advances. Any such amounts held by the
Lessor (or the Agent on behalf of the Lessor) shall be subject to the
lien of the Security Agreement.
(e) All Operative Agreements which are to be delivered to the
Lessor, the Agent, the Lenders or the Holders shall be delivered to the
Agent, on behalf of the Lessor, the Agent, the Lenders or the Holders,
and such items (except for Notes, Certificates and chattel paper
originals, with respect to which in each case there shall be only one
original) shall be delivered with originals sufficient for the Lessor,
the Agent, each Lender and each Holder. All other items which are to be
delivered to the Lessor, the Agent, the Lenders or the Holders shall be
delivered to the Agent, on behalf of the Lessor, the Agent, the Lenders
or the Holders, and such other items shall be held by the Agent. To the
extent any such other items are requested in writing from time to time
by the Lessor, any Lender or any Holder, the Agent shall provide a copy
of such item to the party requesting it.
(f) Notwithstanding the completion of any closing under this
Agreement pursuant to Sections 5.3 or 5.4, each condition precedent in
connection with any such closing may be subsequently enforced by the
Agent (unless such has been expressly waived in writing by the Agent).
5.3. CONDITIONS PRECEDENT FOR THE LESSOR, THE AGENT, THE LENDERS
AND THE HOLDERS RELATING TO THE INITIAL CLOSING DATE AND THE
ADVANCE OF FUNDS FOR THE ACQUISITION OF A PROPERTY.
The obligations (i) on the Initial Closing Date of the Lessor, the
Agent, the Lenders and the Holders to enter into the transactions contemplated
by this Agreement, including without limitation the obligation to execute and
deliver the applicable Operative Agreements to which each is a party on the
Initial Closing Date, (ii) on the Initial Closing Date of the Holders to make
Holder Advances, and of the Lenders to make Loans in order to pay Transaction
Expenses, fees, expenses and other disbursements payable by the Lessor under
Section 7.1(a) of this Agreement and (iii) on a Property Closing Date for the
purpose of providing funds to the Lessor necessary to pay the Transaction
Expenses, fees, expenses and other disbursements payable by the Lessor under
Section 7.1(b) of this Agreement and to acquire or ground lease a Property (an
"Acquisition Advance"), in each case (with regard to the foregoing Sections
5.3(i), (ii) and (iii)) are subject to the satisfaction or waiver of the
following conditions precedent on or prior to the Initial Closing Date or the
applicable Property Closing Date, as the case may be (To the extent such
conditions precedent require the delivery of any agreement, certificate,
instrument, memorandum, legal or other opinion, appraisal, commitment, title
insurance commitment, lien report or any other document of any kind or type,
such shall be in form and substance satisfactory to the Agent, in its reasonable
discretion. Notwithstanding the foregoing, the
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obligations of each party shall not be subject to any conditions contained in
this Section 5.3 which are required to be performed by such party.):
(a) the correctness of the representations and warranties of
the parties to this Agreement contained herein, in each of the other
Operative Agreements and each certificate delivered pursuant to any
Operative Agreement (including without limitation the Incorporated
Representations and Warranties) on each such date, except to the extent
the facts upon which such representation and warranty are based may be
changed as a result of transactions or occurrences permitted or
contemplated hereby or such representation or warranty relates solely
to a prior date;
(b) the performance by the parties to this Agreement of their
respective agreements contained herein and in the other Operative
Agreements to be performed by them on or prior to each such date;
(c) the Agent shall have received a fully executed counterpart
copy of the Requisition, appropriately completed;
(d) title to each such Property shall conform to the
representations and warranties set forth in Section 6.3(l) hereof;
(e) the Construction Agent shall have delivered to the Agent a
good standing certificate for the Construction Agent in the state where
each such Property is located (as of the applicable Property Closing
Date), the Deed with respect to the Land and existing Improvements (if
any), a copy of the Ground Lease (if any), and a copy of the ▇▇▇▇ of
Sale with respect to the Equipment (if any), respecting such of the
foregoing as are being acquired or ground leased on each such date with
the proceeds of the Loans and Holder Advances or which have been
previously acquired or ground leased with the proceeds of the Loans and
Holder Advances and such Land, existing Improvements (if any) and
Equipment (if any) shall be located in an Approved State;
(f) there shall not have occurred and be continuing any
Default or Event of Default under any of the Operative Agreements and
no Default or Event of Default under any of the Operative Agreements
will have occurred and be continuing after giving effect to the Advance
requested by each such Requisition;
(g) the Construction Agent shall have delivered to the Agent
title insurance commitments to issue policies respecting each such
Property in favor of the Lessor and the Agent through an agent or
agency selected by the Construction Agent and from a title insurance
company acceptable to the Agent, with such title exceptions thereto as
are acceptable to the Agent;
(h) the Construction Agent shall have delivered to the Agent
an environmental site assessment respecting each such Property prepared
by an independent recognized professional selected by the Construction
Agent and acceptable to the Agent;
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(i) the Construction Agent shall have delivered to the Agent a
survey (with a flood hazard certification) respecting each such
Property prepared by an independent recognized professional acceptable
to the Agent;
(j) unless such an opinion has previously been delivered with
respect to a particular state, the Construction Agent shall have caused
to be delivered to the Agent a legal opinion in the form attached
hereto as EXHIBIT B or in such other form as is acceptable to the Agent
with respect to local law real property issues respecting the state in
which each such Property is located addressed to the Lessor, the Agent,
the Lenders and the Holders from counsel located in the state where
each such Property is located, and prepared by counsel selected by the
Construction Agent and acceptable to the Agent;
(k) the Agent shall be satisfied that the acquisition, ground
leasing and/or holding of each such Property and the execution of the
Mortgage Instrument and the other Security Documents will not
materially and adversely affect the rights of the Lessor, the Agent,
the Holders or the Lenders under or with respect to the Operative
Agreements;
(l) the Construction Agent shall have delivered to the Agent
invoices for, or other reasonably satisfactory evidence of, the various
Transaction Expenses and other fees, expenses and disbursements
referenced in Sections 7.1(a) or 7.1(b) of this Agreement, as
appropriate;
(m) the Construction Agent shall have caused to be delivered
to the Agent a Mortgage Instrument (substantially in such form as
necessary to conform to applicable state law), Lessor Financing
Statements and Lender Financing Statements respecting each such
Property, all fully executed and in recordable form;
(n) the Lessee shall have delivered to the Agent with respect
to each such Property a Lease Supplement and a memorandum (or short
form lease) regarding the Lease and such Lease Supplement (such
memorandum or short form lease to be substantially in the form attached
to the Lease as EXHIBIT B or in such other form as is acceptable to the
Agent, with modifications as necessary to conform to applicable state
law, and in form suitable for recording);
(o) with respect to each Acquisition Advance, the sum of the
Available Commitment plus the Available Holder Commitment (after
deducting the Unfunded Amount, if any, and after giving effect to the
Acquisition Advance) will be sufficient to pay all amounts payable
therefrom;
(p) if any such Property is subject to a Ground Lease, the
Construction Agent shall have caused a lease memorandum (or short form
lease) to be delivered to the Agent for such Ground Lease and, if
requested by the Agent, a landlord waiver and a mortgagee waiver (in
each case, in such form as is acceptable to the Agent);
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(q) counsel (acceptable to the Agent) for the ground lessor of
each such Property subject to a Ground Lease shall have issued to the
Lessor, the Agent, the Lenders and the Holders, its opinion;
(r) the Construction Agent shall have delivered to the Agent a
preliminary Construction Budget for each such Property, if applicable;
(s) the Construction Agent shall have provided evidence to the
Agent of insurance with respect to each such Property as provided in
the Lease;
(t) subject to Section 5.5 of this Agreement, the Construction
Agent shall have caused an Appraisal regarding each such Property to be
provided to the Agent from an appraiser satisfactory to the Agent;
(u) [intentionally omitted];
(v) the Construction Agent shall cause (i) Uniform Commercial
Code lien searches, tax lien searches and judgment lien searches
regarding the Lessee to be conducted (and copies thereof to be
delivered to the Agent) in such jurisdictions as determined by the
Agent by a nationally recognized search company selected by the
Construction Agent and acceptable to the Agent and (ii) the liens
referenced in such lien searches which are objectionable to the Agent
to be either removed or otherwise handled in a manner satisfactory to
the Agent;
(w) all taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the
Operative Agreements and/or documents related thereto shall have been
paid or provisions for such payment shall have been made to the
satisfaction of the Agent;
(x) [intentionally omitted];
(y) in the opinion of the Agent and its counsel, the
transactions contemplated by the Operative Agreements do not and will
not subject the Lessor, the Lenders, the Agent or the Holders to any
materially adverse regulatory prohibitions, constraints, penalties;
(z) each of the Operative Agreements to be entered into on
such date shall have been duly authorized, executed and delivered by
the parties thereto, and shall be in full force and effect, and the
Agent shall have received a fully executed copy of each of the
Operative Agreements;
(aa) as of the Initial Closing Date only, the Agent shall have
received an Officer's Certificate, dated as of the Initial Closing
Date, of the Lessee in the form attached hereto as EXHIBIT D or in such
other form as is acceptable to the Agent stating that (i) each and
every representation and warranty of each Credit Party contained in the
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Operative Agreements to which it is a party is true and correct on and
as of the Initial Closing Date; (ii) no Default or Event of Default has
occurred and is continuing under any Operative Agreement; (iii) each
Operative Agreement to which any Credit Party is a party is in full
force and effect with respect to it; and (iv) each Credit Party has
duly performed and complied with all covenants, agreements and
conditions contained herein or in any Operative Agreement required to
be performed or complied with by it on or prior to the Initial Closing
Date;
(bb) as of the Initial Closing Date only, the Agent shall have
received (i) a certificate of the Secretary or an Assistant Secretary
of each Credit Party, dated as of the Initial Closing Date, in the form
attached hereto as EXHIBIT E or in such other form as is acceptable to
the Agent attaching and certifying as to (1) the resolutions of the
Board of Directors of such Credit Party duly authorizing the execution,
delivery and performance by such Credit Party of each of the Operative
Agreements to which it is or will be a party, (2) the articles of
incorporation or other such similar organizational documents of such
Credit Party certified as of a recent date by the Secretary of State of
its state of incorporation and its by-laws and (3) the incumbency and
signature of persons authorized to execute and deliver on behalf of
such Credit Party the Operative Agreements to which it is or will be a
party and (ii) a good standing certificate (or local equivalent) from
the appropriate office of the respective states where such Credit Party
is incorporated and where the principal place of business of such
Credit Party is located as to its good standing in each such state;
(cc) since the date of the most recent audited Financial
Statements (as such term is defined in the Lessee Credit Agreement) of
the Lessee, there shall not have occurred any event, condition or state
of facts which shall or could reasonably be expected to have a Material
Adverse Effect, other than as specifically contemplated by the
Operative Agreements;
(dd) as of the Initial Closing Date only, the Agent shall have
received an Officer's Certificate of the Lessor dated as of the Initial
Closing Date in the form attached hereto as EXHIBIT F or in such other
form as is acceptable to the Agent, stating that (i) each and every
representation and warranty of the Lessor contained in the Operative
Agreements to which it is a party is true and correct on and as of the
Initial Closing Date, (ii) each Operative Agreement to which the Lessor
is a party is in full force and effect with respect to it and (iii) the
Lessor has duly performed and complied with all covenants, agreements
and conditions contained herein or in any Operative Agreement required
to be performed or complied with by it on or prior to the Initial
Closing Date;
(ee) as of the Initial Closing Date only, the Agent shall have
received (i) a certificate of the Secretary, an Assistant Secretary,
Trust Officer or Vice President of the Trust Company in the form
attached hereto as EXHIBIT G or in such other form as is acceptable to
the Agent, attaching and certifying as to (A) the signing resolutions
duly authorizing the execution, delivery and performance by the Lessor
of each of the Operative Agreements to which it is or will be a party,
(B) its articles of association or
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other equivalent charter documents and its by-laws, as the case may be,
certified as of a recent date by an appropriate officer of the Trust
Company and (C) the incumbency and signature of persons authorized to
execute and deliver on its behalf the Operative Agreements to which it
is a party and (ii) a good standing certificate from the Office of the
Comptroller of the Currency;
(ff) as of the Initial Closing Date only, counsel for the
Lessor acceptable to the Agent shall have issued to the Lessee, the
Holders, the Lenders and the Agent its opinion in the form attached
hereto as EXHIBIT H or in such other form as is reasonably acceptable
to the Agent; and
(gg) as of the Initial Closing Date only, the Construction
Agent shall have caused to be delivered to the Agent a legal opinion in
the form attached hereto as EXHIBIT I or in such other form as is
reasonably acceptable to the Agent, addressed to the Lessor, the Agent,
the Lenders and the Holders, prepared by counsel acceptable to the
Agent;
(hh) as of the Initial Closing Date only, the Construction
Agent shall cause (i) tax lien searches and judgment lien searches
regarding each Credit Party to be conducted by a nationally recognized
search company acceptable to the Agent (and copies thereof to be
delivered to the Agent) in such jurisdictions as determined by the
Agent and (ii) the liens referenced in such lien searches which are
objectionable to the Agent to be either removed or otherwise handled in
a manner satisfactory to the Agent; and
(ii) as of the Property Closing Date, with respect to each
Permitted Facility which is an improvement to any medical office or
acute care facility (but does not constitute the entire medical office
or acute care facility), the Construction Agent shall cause to be in
place all access easements, utility easements, parking easements and
any and all other easements and/or other documents as required by the
Agent in its reasonable discretion.
5.4. CONDITIONS PRECEDENT FOR THE LESSOR, THE AGENT, THE LENDERS AND
THE HOLDERS RELATING TO THE ADVANCE OF FUNDS AFTER THE ACQUISITION
ADVANCE.
The obligations of the Holders to make Holder Advances, and the Lenders
to make Loans in connection with all requests for Advances subsequent to the
acquisition of a Property including without limitation amounts respecting
Section 11.1(c) of the Lease (and to pay the Transaction Expenses, fees,
expenses and other disbursements payable by the Lessor under Section 7.1 of this
Agreement in connection therewith) are subject to the satisfaction or waiver of
the following conditions precedent (To the extent such conditions precedent
require the delivery of any agreement, certificate, instrument, memorandum,
legal or other opinion, appraisal, commitment, title insurance commitment, lien
report or any other document of any kind or type, such shall be in form and
substance satisfactory to the Agent, in its reasonable discretion.
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Notwithstanding the foregoing, the obligations of each party shall not be
subject to any conditions contained in this Section 5.4 which are required to be
performed by such party.):
(a) the correctness on such date of the representations and
warranties of the parties to this Agreement contained herein, in each
of the other Operative Agreements and each certificate delivered
pursuant to any Operative Agreement (including without limitation the
Incorporated Representations and Warranties on each such date, except
to the extent the facts upon which any such representations and
warranties are based may be changed as a result of transactions or
occurrences permitted or contemplated hereby or any such
representations or warranties relate solely to a prior date);
(b) the performance by the parties to this Agreement of their
respective agreements contained herein and in the other Operative
Agreements to be performed by them on or prior to each such date;
(c) the Agent shall have received a fully executed counterpart
of the Requisition, appropriately completed;
(d) based upon the applicable Construction Budget which shall
satisfy the requirements of this Agreement, the Available Commitments
and the Available Holder Commitment (after deducting the Unfunded
Amount) will be sufficient to complete the Improvements in the
reasonable judgment of the Agent;
(e) there shall not have occurred and be continuing any
Default or Event of Default under any of the Operative Agreements and
no Default or Event of Default under any of the Operative Agreements
will have occurred and be continuing after giving effect to the
Construction Advance requested by the applicable Requisition;
(f) the title insurance policy delivered in connection with
the requirements of Section 5.3(g) shall provide for (or shall be
endorsed to provide for) insurance in an amount at least equal to the
maximum total Property Cost indicated by the Construction Budget
referred to in subparagraph (d) above and there shall be no title
change or exception objectionable to the Agent;
(g) the Construction Agent shall have delivered to the Agent
copies of the Plans and Specifications for the applicable Improvements
or, respecting Section 11.1(c) of the Lease, the Lessee shall have
delivered to the Agent documentation describing each applicable
Modification;
(h) the Construction Agent shall have delivered to the Agent
invoices for, or other reasonably satisfactory evidence of, any
Transaction Expenses and other fees, expenses and disbursements
referenced in Section 7.1(b) that are to be paid with the Advance;
(i) [intentionally omitted];
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(j) the Construction Agent or the Lessee, as the case may be,
shall have delivered, or caused to be delivered to the Agent, invoices,
Bills of Sale or other documents acceptable to the Agent, in each case
with regard to any Equipment or other components of such Property then
being acquired with the proceeds of the Loans and Holder Advances and
naming the Lessor as purchaser and transferee;
(k) all taxes, fees and other charges in connection with the
execution, delivery, recording, filing and registration of the
Operative Agreements shall have been paid or provisions for such
payment shall have been made to the satisfaction of the Agent;
(l) since the date of the most recent audited Financial
Statements (as such term is defined in the Lessee Credit Agreement) of
the Lessee, there shall not have occurred any event, condition or state
of facts which shall or could reasonably be expected to have a Material
Adverse Effect, other than as specifically contemplated by the
Operative Agreements;
(m) [intentionally omitted]; and
(n) in the opinion of the Agent and its counsel, the
transactions contemplated by the Operative Agreements do not and will
not subject the Lessor, the Lenders, the Agent or the Holders to any
materially adverse regulatory prohibitions, constraints, penalties or
fines.
5.5. ADDITIONAL REPORTING AND DELIVERY REQUIREMENTS ON COMPLETION DATE
AND ON CONSTRUCTION PERIOD TERMINATION DATE.
On or prior to the Completion Date for each Property, the Construction
Agent shall deliver to the Agent an Officer's Certificate in the form attached
hereto as EXHIBIT J or in such other form as is reasonably acceptable to the
Agent specifying (a) the address for such Property, (b) the Completion Date for
such Property, (c) the aggregate Property Cost for such Property, (d) detailed,
itemized documentation supporting the asserted Property Cost figures and (e)
that all representations and warranties of the Construction Agent and Lessee in
each of the Operative Agreements and each certificate delivered pursuant thereto
(including without limitation the Incorporated Representations and Warranties)
are true and correct as of the Completion Date. The Agent shall have the right
to contest the information contained in such Officer's Certificate. Furthermore,
on or prior to the Completion Date for each Property, the Construction Agent
shall deliver or cause to be delivered to the Agent (unless previously delivered
to the Agent) originals of the following, each of which shall be in form and
substance acceptable to the Agent, in its reasonable discretion: (u) a title
insurance endorsement regarding the title insurance policy delivered in
connection with the requirements of Section 5.3(g), but only to the extent such
endorsement is necessary to provide for insurance in an amount at least equal to
the maximum total Property Cost and, if endorsed, the endorsement shall not
include a title change or exception objectionable to the Agent; (v) an as-built
survey for such Property, (w) insurance certificates respecting such Property as
required hereunder and under the Lease Agreement, (x) a
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memorandum (or short form) of the Lease and such Lease Supplement (in form
suitable for recording), (y) if requested by the Agent, amendments to the Lessor
Financing Statements executed by the appropriate parties and (z) an Appraisal
regarding such Property provided, however, such an Appraisal shall not be
required if, as of such Completion Date, the Agent has previously received
Appraisal(s) pursuant to Section 5.3(t) for Properties that are then subject to
the Lease and that have an aggregate value (as established by such Appraisal(s))
of at least $7,000,000. In addition, on the Completion Date for such Property
the Construction Agent covenants and agrees that the recording fees, documentary
stamp taxes or similar amounts required to be paid in connection with the
related Mortgage Instrument shall be paid in an amount required by applicable
law, subject, however, to the obligations of the Lenders and the Holders to fund
such costs to the extent required pursuant to Section 7.1.
5.6. THE CONSTRUCTION AGENT DELIVERY OF CONSTRUCTION BUDGET
MODIFICATIONS.
The Construction Agent covenants and agrees to deliver to the Agent
each month notification of any modification to any Construction Budget regarding
any Property if such modification increases the total cost to construct such
Property; provided no Construction Budget may be increased unless (a) the title
insurance policies referenced in Section 5.3(g) are also modified or endorsed,
if necessary, to provide for insurance in an amount that satisfies the
requirements of Section 5.4(f) of this Agreement and (b) after giving effect to
any such amendment, the Construction Budget remains in compliance with the
requirements of Section 5.4(d) of this Agreement.
5.7. RESTRICTIONS ON LIENS.
On each Property Closing Date, the Construction Agent shall cause each
Property acquired by the Lessor on such date to be free and clear of all Liens
except those referenced in Sections 6.3(q)(i) and 6.3(q)(ii). On each date a
Property is either sold to a third party in accordance with the terms of the
Operative Agreements or, pursuant to Section 22.1(a) of the Lease Agreement,
retained by the Lessor, the Lessee shall cause such Property to be free and
clear of all Liens (other than Lessor Liens and such other Liens that are
expressly set forth as title exceptions on the title commitment issued under
Section 5.3(g) with respect to such Property, to the extent such title
commitment has been approved by the Agent).
5.8 PUNCH LIST ITEMS.
Lessee shall cause all punch list items respecting each Property to be
completed in a good and workmanlike manner within one hundred twenty (120) days
of the Completion Date for such Property.
5.9 JOINDER AGREEMENT REQUIREMENTS.
Each Wholly-Owned Entity formed or acquired by the Lessee or another
Wholly-Owned Entity subsequent to the Initial Closing Date shall become a
Guarantor and shall satisfy the following conditions within thirty (30) days
after such formation or acquisition of such Wholly-
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Owned Entity (provided, to the extent such Wholly-Owned Entity does not have
assets with a gross value (determined in accordance with GAAP) in excess of
$100,000 when so formed or acquired but later obtains assets, including but not
limited to investments, loans or other distributions from the Construction
Agent, the Lessee or any Subsidiary thereof in excess of $100,000, then such
Wholly-Owned Entity shall satisfy the following conditions within thirty (30)
days after obtaining such assets):
(a) such Wholly-Owned Entity shall execute and deliver to the
Agent a Joinder Agreement in the form attached hereto as EXHIBIT M;
(b) such Wholly-Owned Entity shall have delivered to the Agent
(x) an Officer's Certificate of such Wholly-Owned Entity in the form
attached hereto as EXHIBIT D, (y) a certificate of the Secretary or an
Assistant Secretary of such Wholly-Owned Entity in the form attached
hereto as EXHIBIT E and (z) good standing certificates (or local
equivalent) from the respective states where such Wholly-Owned Entity
is incorporated and where the principal place of business of such
Wholly-Owned Entity is located as to its good standing in each such
state;
(c) such Wholly-Owned Entity shall have delivered to the Agent
an opinion of counsel (acceptable to the Agent) in the form attached
hereto as EXHIBIT I; and
(d) the Agent shall have received such other documents,
certificates and information as the Agent shall have reasonably
requested.
SECTION 6. REPRESENTATIONS AND WARRANTIES.
6.1. [INTENTIONALLY OMITTED]
6.2. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
Effective as of the Initial Closing Date and the date of each Advance,
the Trust Company in its individual capacity and as the Borrower, as indicated,
represents and warrants to each of the other parties hereto as follows,
provided, that the representations in the following paragraphs (h), (j) and (k)
are made solely in its capacity as the Borrower:
(a) It is a national banking association and is duly organized
and validly existing and in good standing under the laws of the United
States of America and has the power and authority to enter into and
perform its obligations under the Trust Agreement and (assuming due
authorization, execution and delivery of the Trust Agreement by the
Holders) has the corporate and trust power and authority to act as the
Owner Trustee and to enter into and perform the obligations under each
of the other Operative Agreements to which the Trust Company or the
Owner Trustee, as the case may be, is or will be a party and each other
agreement, instrument and document to be executed and delivered by it
on or before such Closing Date in connection with or as contemplated by
each such
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Operative Agreement to which the Trust Company or the Owner Trustee, as
the case may be, is or will be a party;
(b) The execution, delivery and performance of each Operative
Agreement to which it is or will be a party, either in its individual
capacity or (assuming due authorization, execution and delivery of the
Trust Agreement by the Holders) as the Owner Trustee, as the case may
be, has been duly authorized by all necessary action on its part and
neither the execution and delivery thereof, nor the consummation of the
transactions contemplated thereby, nor compliance by it with any of the
terms and provisions thereof (i) does or will require any approval or
consent of any trustee or holders of any of its indebtedness or
obligations, (ii) does or will contravene any Legal Requirement
relating to its banking or trust powers, (iii) does or will contravene
or result in any breach of or constitute any default under, or result
in the creation of any Lien upon any of its property under, (A) its
charter or by-laws, or (B) any indenture, mortgage, chattel mortgage,
deed of trust, conditional sales contract, bank loan or credit
agreement or other agreement or instrument to which it is a party or by
which it or its properties may be bound or affected, which
contravention, breach, default or Lien under clause (B) would
materially and adversely affect its ability, in its individual capacity
or as the Owner Trustee, to perform its obligations under the Operative
Agreements to which it is a party or (iv) does or will require any
Governmental Action by any Governmental Authority regulating its
banking or trust powers;
(c) The Trust Agreement and, assuming the Trust Agreement is
the legal, valid and binding obligation of the Holders, each other
Operative Agreement to which the Trust Company or the Owner Trustee, as
the case may be, is or will be a party have been, or on or before such
Closing Date will be, duly executed and delivered by the Trust Company
or the Owner Trustee, as the case may be, and the Trust Agreement and
each such other Operative Agreement to which the Trust Company or the
Owner Trustee, as the case may be, is a party constitutes, or upon
execution and delivery will constitute, a legal, valid and binding
obligation enforceable against the Trust Company or the Owner Trustee,
as the case may be, in accordance with the terms thereof;
(d) There is no action or proceeding pending or, to its
knowledge, threatened to which it is or will be a party, either in its
individual capacity or as the Owner Trustee, before any Governmental
Authority that, if adversely determined, would materially and adversely
affect its ability, in its individual capacity or as the Owner Trustee,
to perform its obligations under the Operative Agreements to which it
is a party or would question the validity or enforceability of any of
the Operative Agreements to which it is or will become a party;
(e) It has not assigned or transferred any of its right, title
or interest in or under the Lease, the Agency Agreement or its interest
in any Property or any portion thereof, except in accordance with the
Operative Agreements;
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(f) No Default of Event of Default under the Operative
Agreements attributable to it has occurred and is continuing;
(g) Except as otherwise contemplated in the Operative
Agreements, the proceeds of the Loans and Holder Advances shall not be
applied by the Owner Trustee for any purpose other than (i) the
purchase and/or lease of the Properties, the acquisition, installation
and testing of the Equipment, the construction of Improvements and the
payment of Transaction Expenses and the fees, expenses and other
disbursements referenced in Sections 7.1(a) and 7.1(b) of this
Agreement, in each case which accrue prior to the Rent Commencement
Date with respect to a particular Property and (ii) Modifications in
accordance with Section 11.1(c) of the Lease;
(h) Neither the Owner Trustee nor any Person authorized by the
Owner Trustee to act on its behalf has offered or sold any interest in
the Trust Estate or the Notes, or in any similar security relating to a
Property, or in any security the offering of which for the purposes of
the Securities Act would be deemed to be part of the same offering as
the offering of the aforementioned securities to, or solicited any
offer to acquire any of the same from, any Person other than, in the
case of the Notes, the Agent, and neither the Owner Trustee nor any
Person authorized by the Owner Trustee to act on its behalf will take
any action which would subject, as a direct result of such action
alone, the issuance or sale of any interest in the Trust Estate or the
Notes to the provisions of Section 5 of the Securities Act or require
the qualification of any Operative Agreement under the Trust Indenture
Act of 1939, as amended;
(i) The Owner Trustee's principal place of business, chief
executive office and office where the documents, accounts and records
relating to the transactions contemplated by this Agreement and each
other Operative Agreement are kept are located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇;
(j) The Owner Trustee is not engaged principally in, and does
not have as one (1) of its important activities, the business of
extending credit for the purpose of purchasing or carrying any margin
stock (within the meaning of Regulation U of the Board of Governors of
the Federal Reserve System of the United States), and no part of the
proceeds of the Loans or the Holder Advances will be used by it to
purchase or carry any margin stock or to extend credit to others for
the purpose of purchasing or carrying any such margin stock or for any
purpose that violates, or is inconsistent with, the provisions of
Regulations G, T, U, or X of the Board of Governors of the Federal
Reserve System of the United States;
(k) The Owner Trustee is not an "investment company" or a
company controlled by an "investment company" within the meaning of the
Investment Company Act;
(l) Each Property is free and clear of all Lessor Liens
attributable to the Owner Trustee in its individual capacity; and
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(m) The Owner Trustee, in its trust capacity, is a party to no
documents, instruments or agreements other than the Operative
Agreements to which it is a party and any other documents delivered by
the Owner Trustee in connection with the Operative Agreements.
6.3. REPRESENTATIONS AND WARRANTIES OF EACH CREDIT PARTY.
Effective as of the Initial Closing Date, the date of each Advance, the
date each Wholly-Owned Entity delivers a Joinder Agreement and the Rent
Commencement Date, each Credit Party represents and warrants to each of the
other parties hereto that:
(a) The Incorporated Representations and Warranties are true
and correct (unless such relate solely to an earlier point in time) and
the Lessee has delivered to the Agent the financial statements and
other reports referred to in Article IV of the Lessee Credit Agreement;
(b) The execution and delivery by each Credit Party of this
Agreement and the other applicable Operative Agreements as of such date
and the performance by each Credit Party of its respective obligations
under this Agreement and the other applicable Operative Agreements are
within the corporate powers of each Credit Party, have been duly
authorized by all necessary corporate action on the part of each Credit
Party (including without limitation any necessary shareholder action),
have been duly executed and delivered, have received all necessary
governmental approval, and do not (i) violate any Legal Requirement
which is binding on any Credit Party or any Subsidiary of any Credit
Party, (ii)contravene or conflict with, or result in a breach of, any
provision of the Articles of Incorporation, By-Laws or other such
similar organizational documents of any Credit Party or any Subsidiary
of any Credit Party or of any agreement, indenture, instrument or other
document which is binding on any Credit Party or any Subsidiary of any
Credit Party or (iii) result in, or require, the creation or imposition
of any Lien (other than pursuant to the terms of the Operative
Agreements) on any asset of any Credit Party or any of Subsidiary of
any Credit Party;
(c) This Agreement and the other applicable Operative
Agreements executed prior to and as of such date by any Credit Party
constitute the legal, valid and binding obligation of such Credit
Party, as applicable, enforceable against such Credit Party, as
applicable, in accordance with their terms, except as enforceability
may be limited by bankruptcy or general principles of equity. Each
Credit Party has executed the various Operative Agreements required to
be executed by such Credit Party as of such date;
(d) Except as described in EXHIBIT K, there are no actions,
suits or proceedings pending or, to our knowledge, threatened against
any Credit Party in any court or before any Governmental Authority (nor
shall any order, judgment or decree have been issued or proposed to be
issued by any Governmental Authority to set aside, restrain, enjoin or
prevent the full performance of any Operative Agreement or any
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transaction contemplated thereby) that (i) concern any Credit Party or
any Property or the Lessee's interest therein, that in any such case
have or could reasonable be expected to have a Material Adverse Effect
or (ii) question the validity or enforceability of any Operative
Agreement or any transaction described in the Operative Agreements;
(e) No Governmental Action by any Governmental Authority or
other authorization, registration, consent, approval, waiver, notice or
other action by, to or of any other Person pursuant to any Legal
Requirement, contract, indenture, instrument or agreement or for any
other reason is required to authorize or is required in connection with
(i) the execution, delivery or performance of any Operative Agreement,
(ii) the legality, validity, binding effect or enforceability of any
Operative Agreement, (iii) the acquisition, ownership, construction,
completion, occupancy, operation, leasing or subleasing of any Property
or (iv) any Advance, in each case, except those which have been
obtained and are in full force and effect or will be obtained prior to
the time such are required;
(f) Upon the execution and delivery of each Lease Supplement
to the Lease, (i) the Lessee will have unconditionally accepted the
Property subject to the Lease Supplement and will have a valid and
subsisting leasehold interest in such Property, subject only to the
Permitted Liens, and (ii) no offset will exist with respect to any Rent
or other sums payable under the Lease;
(g) Except as otherwise contemplated by the Operative
Agreements, the Construction Agent shall not use the proceeds of any
Holder Advance or Loan for any purpose other than (i) the purchase
and/or lease of the Properties, the acquisition, installation and
testing of the Equipment, the construction of Improvements and the
payment of Transaction Expenses and the fees, expenses and other
disbursements referenced in Sections 7.1(a) and 7.1(b) of this
Agreement, in each case which accrue prior to the Rent Commencement
Date with respect to a particular Property and (ii) in accordance with
Section 11.1(c) of the Lease;
(h) All information heretofore or contemporaneously herewith
furnished by any Credit Party or any Subsidiary of any Credit Party to
the Agent, the Owner Trustee, any Lender or any Holder for purposes of
or in connection with this Agreement and the transactions contemplated
hereby is, and all information hereafter furnished by or on behalf of
any Credit Party or any Subsidiary of any Credit Party to the Agent,
the Owner Trustee, any Lender or any Holder pursuant hereto or in
connection herewith will be, true and accurate in every material
respect on the date as of which such information is dated or certified,
and such information, taken as a whole, does not and will not omit to
state any material fact necessary to make such information, taken as a
whole, not misleading;
(i) The principal place of business, chief executive office
and office of the Construction Agent and the Lessee where the
documents, accounts and records relating to the transactions
contemplated by this Agreement and each other Operative Agreement are
kept are located at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
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Tennessee 37027. The states of incorporation/formation and the
principal place of business of each Guarantor are located in the states
set forth on EXHIBIT N;
(j) The representations and warranties of each Credit Party
set forth in any of the Operative Agreements are true and correct in
all material respects on and as of each such date as if made on and as
of such date, except to the extent the facts on which any such
representation or warranty are based may be changed as result of
transactions or occurrences permitted or contemplated hereby or any
such representation or warranty relates solely to a prior date. Each
Credit Party is in all material respects in compliance with its
obligations under the Operative Agreements and there exists no Default
or Event of Default under any of the Operative Agreements which is
continuing and which has not been cured within any cure period
expressly granted under the terms of the applicable Operative Agreement
or otherwise waived in accordance with the applicable Operative
Agreement. No Default or Event of Default will occur under any of the
Operative Agreements as a result of, or after giving effect to, the
Advance requested by the Requisition on the date of each Advance;
(k) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, each Property
then being financed consists of (i) unimproved Land or (ii) Land and
existing Improvements thereon which Improvements are either suitable
for occupancy at the time of acquisition or ground leasing or will be
renovated and/or modified in accordance with the terms of this
Agreement. Each Property then being financed is located at the location
set forth on the applicable Requisition, each of which is in one (1) of
the Approved States;
(l) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, the Lessor has
good and marketable fee simple title to each Property, or, if any
Property is the subject of a Ground Lease, the Lessor will have a valid
ground leasehold interest enforceable against the ground lessor of such
Property in accordance with the terms of such Ground Lease, subject
only to (i) such Liens referenced in Sections 6.3(q)(i) and 6.3(q)(ii)
on the applicable Property Closing Date and (ii) subject to Section
5.7, Permitted Liens after the applicable Property Closing Date;
(m) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, no portion of
any Property is located in an area identified as a special flood hazard
area by the Federal Emergency Management Agency or other applicable
agency, or if any such Property is located in an area identified as a
special flood hazard area by the Federal Emergency Management Agency or
other applicable agency, then flood insurance has been obtained for
such Property in accordance with Section 14.2(b) of the Lease and in
accordance with the National Flood Insurance Act of 1968, as amended;
(n) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, each Property
complies with all Insurance
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Requirements and all standards of Lessee or any other Credit Party with
respect to similar properties (in similar markets) owned or operated by
Lessee or any other Credit Party;
(o) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, each Property
complies with all Legal Requirements as of such date (including without
limitation all zoning and land use laws and Environmental Laws), except
to the extent that failure to comply therewith, individually or in the
aggregate, shall not and could not reasonably be expected to have a
Material Adverse Effect;
(p) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, all utility
services and facilities necessary for the construction and operation of
the Improvements and the installation and operation of the Equipment
regarding each Property (including without limitation gas, electrical,
water and sewage services and facilities) are available directly or
indirectly at the applicable Land or will be constructed prior to the
Completion Date for such Property;
(q) (i) The Security Documents create, as security for the
Obligations (as such term is defined in the Security Agreement), valid
and enforceable security interests in, and Liens on, all of the
Collateral, in favor of the Agent, for the ratable benefit of the
Lenders and the Holders, as their respective interests appear in the
Operative Agreements, and such security interests and Liens are subject
to no other Liens other than Liens that are expressly set forth as
title exceptions on the title commitment issued under Section 5.3(g)
with respect to the applicable Property, to the extent such title
commitment has been approved by the Agent. Upon recordation of the
Mortgage Instrument in the real estate recording office in the
applicable Approved State identified by the Construction Agent or the
Lessee, the Lien created by the Mortgage Instrument in the real
property described therein shall be a perfected first priority mortgage
Lien on such real property in favor of the Agent, for the ratable
benefit of the Lenders and the Holders, as their respective interests
appear in the Operative Agreements. To the extent that the security
interests in the portion of the Collateral comprised of personal
property can be perfected by filing in the filing offices in the
applicable Approved States or elsewhere identified by the Construction
Agent or the Lessee, upon filing of the Lender Financing Statements in
such filing offices, the security interests created by the Security
Agreement shall be perfected first priority security interests in such
personal property in favor of the Agent, for the ratable benefit of the
Lenders and the Holders, as their respective interests appear in the
Operative Agreements;
(ii) The Lease Agreement creates, as security for the
obligations of the Lessee under the Lease Agreement, valid and
enforceable security interests in, and Liens on, each Property leased
thereunder, in favor of the Lessor, and such security interests and
Liens are subject to no other Liens other than Liens that are expressly
set forth as title exceptions on the title commitment issued under
Section 5.3(g) with respect to the applicable Property, to the extent
such title commitment has been approved by the Agent. Upon recordation
of the memorandum of the Lease Agreement and the memorandum of a
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Ground Lease (or, in either case, a short form lease) in the real
estate recording office in the applicable Approved State identified by
the Construction Agent or the Lessee, the Lien created by the Lease
Agreement in the real property described therein shall be a perfected
first priority mortgage Lien on such real property in favor of the
Agent, for the ratable benefit of the Lenders and the Holders, as their
respective interests appear in the Operative Agreements. To the extent
that the security interests in the portion of any Property comprised of
personal property can be perfected by the filing in the filing offices
in the applicable Approved State or elsewhere identified by the
Construction Agent or the Lessee upon filing of the Lessor Financing
Statements in such filing offices, a security interest created by the
Lease Agreement shall be perfected first priority security interests in
such personal property in favor of the Lessor, which rights pursuant to
the Lessor Financing Statements are assigned to the Agent, for the
ratable benefit of the Lenders and the Holders, as their respective
interests appear in the Operative Agreements;
(r) [intentionally omitted];
(s) The Plans and Specifications for each Property will be
prepared prior to the commencement of construction in accordance with
all applicable Legal Requirements (including without limitation all
applicable Environmental Laws and building, planning, zoning and fire
codes), except to the extent the failure to comply therewith,
individually or in the aggregate, shall not have and could not
reasonably be expected to have a Material Adverse Effect. Upon
completion of the Improvements for each Property in accordance with the
applicable Plans and Specifications, such Improvements will be within
any building restriction lines and will not encroach in any manner onto
any adjoining land (except as permitted by express written easements,
which have been approved by the Agent);
(t) As of the Rent Commencement Date only, each Property shall
be operational;
(u) As of each Property Closing Date, the date of each
subsequent Advance and the Rent Commencement Date only, acquisition,
installation and testing of the Equipment (if any) and construction of
the Improvements (if any) to such date shall have been performed in a
good and workmanlike manner, substantially in accordance with the
applicable Plans and Specifications;
(v) As of each Property Closing Date only, each Property has
been acquired or (to the extent the consent of the Agent is required)
ground leased pursuant to a Ground Lease at a price that is not in
excess of fair market value or fair market rental value, as the case
may be; and
(w) As of the Initial Closing Date, each Wholly-Owned Entity
(formed prior to or on such date) shall have executed this Agreement in
its capacity as a Guarantor.
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SECTION 6B. GUARANTY
6B.1. GUARANTY OF PAYMENT AND PERFORMANCE.
Subject to Section 6B.7, each Guarantor hereby, jointly and severally,
unconditionally guarantees to each Financing Party the prompt payment and
performance of the Company Obligations in full when due (whether at stated
maturity, as a mandatory prepayment, by acceleration or otherwise) or when such
is otherwise to be performed; provided, notwithstanding the foregoing, the
obligations of the Guarantors under this Section 6B shall not constitute a
direct guaranty of the indebtedness of the Lessor evidenced by the Notes but
rather a guaranty of the Company Obligations arising under the Operative
Agreements. This Section 6B is a guaranty of payment and performance and not of
collection and is a continuing guaranty and shall apply to all Company
Obligations whenever arising. All rights granted to the Financing Parties under
this Section 6B shall be subject to the provisions of Section 8.2(h) and 8.6.
6B.2. OBLIGATIONS UNCONDITIONAL.
Each Guarantor agrees that the obligations of the Guarantors hereunder
are absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Operative Agreements, or
any other agreement or instrument referred to therein, or any substitution,
release or exchange of any other guarantee of or security for any of the Company
Obligations, and, to the fullest extent permitted by applicable law,
irrespective of any other circumstance whatsoever which might otherwise
constitute a legal or equitable discharge or defense of a surety, guarantor or
co-obligor, it being the intent of this Section 6B.2 that the obligations of the
Guarantors hereunder shall be absolute and unconditional under any and all
circumstances. Each Guarantor agrees that this Section 6B may be enforced by the
Financing Parties without the necessity at any time of resorting to or
exhausting any other security or collateral and without the necessity at any
time of having recourse to the Notes, the Certificates or any other of the
Operative Agreements or any collateral, if any, hereafter securing the Company
Obligations or otherwise and each Guarantor hereby waives the right to require
the Financing Parties to proceed against the Construction Agent, the Lessee or
any other Person (including without limitation a co-guarantor) or to require the
Financing Parties to pursue any other remedy or enforce any other right. Each
Guarantor further agrees that it hereby waives any and all right of subrogation,
indemnity, reimbursement or contribution against the Lessee and the Construction
Agent or any other Guarantor of the Company Obligations for amounts paid under
this Section 6B until such time as the Loans, Holder Advances, accrued but
unpaid interest, accrued but unpaid Holder Yield and all other amounts owing
under the Operative Agreements have been paid in full. Without limiting the
generality of the waiver provisions of this Section 6B, each Guarantor hereby
waives any rights to require the Financing Parties to proceed against the
Construction Agent, the Lessee or any co-guarantor or to require Lessor to
pursue any other remedy or enforce any other right, including without
limitation, any and all rights under N.C. Gen. Stat. ▇▇.▇▇. 26-7 through 26-9.
Each Guarantor further agrees that nothing contained herein shall prevent the
Financing Parties from suing on any Operative Agreement or foreclosing any
security interest in or Lien on any collateral, if any, securing the Company
Obligations or from exercising any other rights available to it under any
Operative Agreement, or any other instrument of security, if any, and the
exercise of any of the
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aforesaid rights and the completion of any foreclosure proceedings shall not
constitute a discharge of any Guarantor's obligations hereunder; it being the
purpose and intent of each Guarantor that its obligations hereunder shall be
absolute, independent and unconditional under any and all circumstances;
provided that any amounts due under this Section 6B which are paid to or for the
benefit of any Financing Party shall reduce the Company Obligations by a
corresponding amount (unless required to be rescinded at a later date). Neither
any Guarantor's obligations under this Section 6B nor any remedy for the
enforcement thereof shall be impaired, modified, changed or released in any
manner whatsoever by an impairment, modification, change, release or limitation
of the liability of the Construction Agent or the Lessee or by reason of the
bankruptcy or insolvency of the Construction Agent or the Lessee. Each Guarantor
waives any and all notice of the creation, renewal, extension or accrual of any
of the Company Obligations and notice of or proof of reliance by any Financing
Party upon this Section 6B or acceptance of this Section 6B. The Company
Obligations shall conclusively be deemed to have been created, contracted or
incurred, or renewed, extended, amended or waived, in reliance upon this Section
6B. All dealings between the Construction Agent, the Lessee and any of the
Guarantors, on the one hand, and the Financing Parties, on the other hand,
likewise shall be conclusively presumed to have been had or consummated in
reliance upon this Section 6B.
6B.3. MODIFICATIONS.
Each Guarantor agrees that (a) all or any part of the security now or
hereafter held for the Company Obligations, if any, may be exchanged,
compromised or surrendered from time to time; (b) no Financing Party shall have
any obligation to protect, perfect, secure or insure any such security
interests, liens or encumbrances now or hereafter held, if any, for the Company
Obligations or the properties subject thereto; (c) the time or place of payment
of the Company Obligations may be changed or extended, in whole or in part, to a
time certain or otherwise, and may be renewed or accelerated, in whole or in
part; (d) the Construction Agent, the Lessee and any other party liable for
payment under the Operative Agreements may be granted indulgences generally; (e)
any of the provisions of the Notes, the Certificates or any of the other
Operative Agreements may be modified, amended or waived; (f) any party
(including any co-guarantor) liable for the payment thereof may be granted
indulgences or be released; and (g) any deposit balance for the credit of the
Construction Agent, the Lessee or any other party liable for the payment of the
Company Obligations or liable upon any security therefor may be released, in
whole or in part, at, before or after the stated, extended or accelerated
maturity of the Company Obligations, all without notice to or further assent by
such Guarantor, which shall remain bound thereon, notwithstanding any such
exchange, compromise, surrender, extension, renewal, acceleration, modification,
indulgence or release.
6B.4. WAIVER OF RIGHTS.
Each Guarantor expressly waives to the fullest extent permitted by
applicable law: (a) notice of acceptance of this Section 6B by any Financing
Party and of all extensions of credit or other Advances to the Construction
Agent and the Lessee by the Lenders pursuant to the terms of the Operative
Agreements; (b) presentment and demand for payment or performance of any of the
Company Obligations; (c) protest and notice of dishonor or of default with
respect to the Company
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Obligations or with respect to any security therefor; (d) notice of any
Financing Party obtaining, amending, substituting for, releasing, waiving or
modifying any security interest, lien or encumbrance, if any, hereafter securing
the Company Obligations, or any Financing Party's subordinating, compromising,
discharging or releasing such security interests, liens or encumbrances, if any;
and (e) all other notices to which such Guarantor might otherwise be entitled.
Notwithstanding anything to the contrary herein, (i) each Guarantor's payments
hereunder shall be due five (5) Business Days after written demand by the Agent
for such payment (unless the Company Obligations are automatically accelerated
pursuant to the applicable provisions of the Operative Agreements in which case
the Guarantors' payments shall be automatically due) and (ii) any modification
of the Operative Agreements which has the effect of increasing the Company
Obligations shall not be enforceable against a Guarantor unless such Guarantor
executes the document evidencing such modification or otherwise reaffirms its
guaranty in writing in connection with such modification.
6B.5. REINSTATEMENT.
The obligations of the Guarantors under this Section 6B shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Company Obligations is rescinded or
must be otherwise restored by any holder of any of the Company Obligations,
whether as a result of any proceedings in bankruptcy or reorganization or
otherwise, and each Guarantor agrees that it will indemnify each Financing Party
on demand for all reasonable costs and expenses (including, without limitation,
reasonable fees of counsel) incurred by any Financing Party in connection with
such rescission or restoration, including without limitation any such costs and
expenses incurred in defending against any claim alleging that such payment
constituted a preference, fraudulent transfer or similar payment under any
bankruptcy, insolvency or similar law.
6B.6. REMEDIES.
The Guarantors agree that, as between the Guarantors, on the one hand,
and each Financing Party, on the other hand, the Company Obligations may be
declared to be forthwith due and payable as provided in the applicable
provisions of the Operative Agreements (and shall be deemed to have become
automatically due and payable in the circumstances provided therein)
notwithstanding any stay, injunction or other prohibition preventing such
declaration (or preventing such Company Obligations from becoming automatically
due and payable) as against any other Person and that, in the event of such
declaration (or such Company Obligations being deemed to have become
automatically due and payable), such Company Obligations (whether or not due and
payable by any other Person) shall forthwith become due and payable by the
Guarantors in accordance with the applicable provisions of the Operative
Agreements.
6B.7. LIMITATION OF GUARANTY.
Notwithstanding any provision to the contrary contained herein or in
any of the other Operative Agreements, to the extent the obligations of any
Guarantor shall be adjudicated to be invalid or unenforceable for any reason
(including without limitation because of any applicable
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state or federal law relating to fraudulent conveyances or transfers) then the
obligations of such Guarantor hereunder shall be limited to the maximum amount
that is permissible under applicable law (whether federal or state and including
without limitation the Bankruptcy Code).
Subject to Section 6B.5, upon the satisfaction of the Company
Obligations in full, regardless of the source of payment, the Guarantors'
obligations hereunder shall be deemed satisfied, discharged and terminated other
than indemnifications set forth herein that expressly survive.
6B.8. PAYMENT OF AMOUNTS TO THE AGENT.
Each Financing Party hereby instructs each Guarantor, and each
Guarantor hereby acknowledges and agrees, that until such time as the Loans and
the Holder Advances are paid in full and the Liens evidenced by the Security
Agreement and the Mortgage Instruments have been released any and all Rent
(excluding Excepted Payments which shall be payable to each Holder or other
Person as appropriate) and any and all other amounts of any kind or type under
any of the Operative Agreements due and owing or payable to any Person shall
instead be paid directly to the Agent (excluding Excepted Payments which shall
be payable to each Holder or other Person as appropriate) or as the Agent may
direct from time to time for allocation and distribution in accordance with the
procedures set forth in Section 8.7 hereof.
6B.9. RELEASE OF GUARANTORS.
Each Financing Party hereby agrees that (a) the Agent shall be
permitted to release any Guarantor from its guaranty obligations under this
Section 6B without the consent of any other Financing Party if the release is
granted in connection with a disposition by the applicable Credit Party of all
the shares of stock or partnership or other equity interest in such Guarantor
and such disposition is permitted pursuant to the applicable provisions of the
Operative Agreements and the Lessee Credit Agreement and (b) the Agent shall be
permitted to release any Guarantor from its guaranty obligations under this
Section 6B.9 without the consent of any other Financing Party if the release is
requested by the Construction Agent or the Lessee in connection with a
dissolution of the Guarantor, subject to the Construction Agent or the Lessee
providing to the Agent written representations to the effect that such Guarantor
has no business operations and no assets.
SECTION 7. PAYMENT OF CERTAIN EXPENSES.
7.1. TRANSACTION EXPENSES.
(a) The Lessor agrees on the Initial Closing Date, to pay, or
cause to be paid, all Transaction Expenses arising from the Initial
Closing Date, including without limitation all reasonable fees,
expenses and disbursements of the various legal counsels for the Lessor
and the Agent in connection with the transactions contemplated by the
Operative Agreements and incurred in connection with such Initial
Closing Date, the initial fees and expenses of the Owner Trustee due
and payable on such Initial Closing
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Date, all fees, taxes and expenses for the recording, registration and
filing of documents and all other reasonable fees, expenses and
disbursements incurred in connection with such Initial Closing Date;
provided, however, the Lessor shall pay such amounts described in this
Section 7.1(a) only if (i) such amounts are properly described in a
Requisition delivered on or before the Initial Closing Date, and (ii)
funds are made available by the Lenders and the Holders in connection
with such Requisition in an amount sufficient to allow such payment. On
the Initial Closing Date after delivery and receipt of the Requisition
referenced in Section 4.2(a) hereof and satisfaction of the other
conditions precedent for such date, the Holders shall make Holder
Advances and the Lenders shall make Loans to the Lessor to pay for the
Transaction Expenses, fees, expenses and other disbursements referenced
in this Section 7.1(a). The Lessee agrees to timely pay all amounts
referred to in this Section 7.1(a) to the extent not paid by the
Lessor.
(b) Assuming no Default or Event of Default shall have
occurred and be continuing and only for the period prior to the Rent
Commencement Date, the Lessor agrees on each Property Closing Date, on
the date of any Construction Advance and on the Completion Date to pay,
or cause to be paid, all Transaction Expenses including without
limitation all reasonable fees, expenses and disbursements of the
various legal counsels for the Lessor and the Agent in connection with
the transactions contemplated by the Operative Agreements and billed in
connection with such Advance or such Completion Date, all amounts
described in Section 7.1(a) of this Agreement which have not been
previously paid, the annual fees and reasonable out-of-pocket expenses
of the Owner Trustee, all fees, expenses and disbursements incurred
with respect to the various items referenced in Sections 5.3, 5.4
and/or 5.5 (including without limitation any premiums for title
insurance policies and charges for any updates to such policies) and
all other reasonable fees, expenses and disbursements in connection
with such Advance or such Completion Date including without limitation
all expenses relating to and all fees, taxes and expenses for the
recording, registration and filing of documents and during the
Commitment Period, all fees, expenses and costs referenced in Sections
7.3(a), 7.3(b), 7.3(d) and 7.4; provided, however, the Lessor shall pay
such amounts described in this Section 7.1(b) only if (i) such amounts
are properly described in a Requisition delivered on the applicable
date and (ii) funds are made available by the Lenders and the Holders
in connection with such Requisition in an amount sufficient to allow
such payment. On each Property Closing Date, on the date of any
Construction Advance or any Completion Date, after delivery of the
applicable Requisition and satisfaction of the other conditions
precedent for such date, the Holders shall make a Holder Advance and
the Lenders shall make Loans to the Lessor to pay for the Transaction
Expenses, fees, expenses and other disbursements referenced in this
Section 7.1(b). The Lessee agrees to timely pay all amounts referred to
in this Section 7.1(b) to the extent not paid by the Lessor.
7.2. [INTENTIONALLY OMITTED]
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7.3. CERTAIN FEES AND EXPENSES.
The Lessee agrees to pay or cause to be paid (a) the initial and annual
Owner Trustee's fee and all reasonable expenses of the Owner Trustee and any
co-trustees (including without limitation reasonable counsel fees and expenses)
or any successor owner trustee and/or co-trustee, for acting as the owner
trustee under the Trust Agreement, (b) all reasonable costs and expenses
incurred by the Credit Parties, the Agent, the Lenders, the Holders or the
Lessor in entering into any Lease Supplement and any future amendments,
modifications, supplements, restatements and/or replacements with respect to any
of the Operative Agreements, whether or not such Lease Supplement, amendments,
modifications, supplements, restatements and/or replacements are ultimately
entered into, or giving or withholding of waivers of consents hereto or thereto,
which have been requested by the Credit Parties, the Agent, the Lenders, the
Holders or the Lessor, (c) all reasonable costs and expenses incurred by the
Credit Parties, the Agent, the Lenders, the Holders or the Lessor in connection
with any exercise of remedies under any Operative Agreement or any purchase of
any Property by any Credit Party or any third party and (d) all reasonable costs
and expenses incurred by the Credit Parties, the Agent, the Lenders, the Holders
or the Lessor in connection with any transfer or conveyance of any Property,
whether or not such transfer or conveyance is ultimately accomplished.
7.4. FACILITY FEE.
During the Commitment Period, the Lessee agrees to pay or to cause to
be paid to the Agent for the account of (a) the Lenders, respectively, a
facility fee (the "Lender Facility Fee") equal to the product of the average
daily Available Commitment multiplied by a rate equal to the Applicable
Percentage for the Lender Facility Fee and (b) the Holders, respectively, a
facility fee (the "Holder Facility Fee") equal to the product of the average
daily Available Holder Commitments multiplied by a rate equal to the Applicable
Percentage for the Holder Facility Fee. Such Facility Fees shall be calculated
on the basis of a year of three hundred sixty (360) days for the actual days
elapsed and shall be payable quarterly in arrears on each Facility Fee Payment
Date. If all or a portion of any such Facility Fee shall not be paid when due,
such overdue amount shall bear interest, payable by the Lessee on demand, at a
rate per annum equal to the ABR plus two percent (2%) from the date of such
non-payment until such amount is paid in full (as well as before judgment).
SECTION 8. OTHER COVENANTS AND AGREEMENTS.
8.1. COOPERATION WITH THE CONSTRUCTION AGENT OR THE LESSEE.
The Holders, the Lenders, the Lessor (at the direction of the Majority
Secured Parties) and the Agent shall, at the expense of and to the extent
reasonably requested by the Construction Agent or the Lessee (but without
assuming additional liabilities on account thereof and only to the extent such
is acceptable to the Holders, the Lenders, the Lessor (at the direction of the
Majority Secured Parties) and the Agent in their reasonable discretion),
cooperate with the Construction Agent or the Lessee in connection with the
Construction Agent or the Lessee
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satisfying its covenant obligations contained in the Operative Agreements
including without limitation at any time and from time to time, promptly and
duly executing and delivering any and all such further instruments, documents
and financing statements (and continuation statements related thereto).
8.2. COVENANTS OF THE OWNER TRUSTEE AND THE HOLDERS.
Each of the Owner Trustee and the Holders hereby agrees that so long as
this Agreement is in effect:
(a) Neither the Owner Trustee (in its trust capacity or in its
individual capacity) nor any Holder will create or permit to exist at
any time, and each of them will, at its own cost and expense, promptly
take such action as may be necessary duly to discharge, or to cause to
be discharged, all Lessor Liens on the Properties attributable to it;
provided, however, that the Owner Trustee and the Holders shall not be
required to so discharge any such Lessor Lien while the same is being
contested in good faith by appropriate proceedings diligently
prosecuted so long as such proceedings shall not materially and
adversely affect the rights of the Lessee under the Lease and the other
Operative Agreements or involve any material danger of impairment of
the Liens of the Security Documents or of the sale, forfeiture or loss
of, and shall not interfere with the use or disposition of, any
Property or title thereto or any interest therein or the payment of
Rent;
(b) Without prejudice to any right under the Trust Agreement
of the Owner Trustee to resign (subject to requirement set forth in the
Trust Agreement that such resignation shall not be effective until a
successor shall have agreed to accept such appointment), or the
Holders' rights under the Trust Agreement to remove the institution
acting as the Owner Trustee (after consent to such removal by the Agent
as provided in the Trust Agreement), each of the Owner Trustee and the
Holders hereby agrees with the Lessee and the Agent (i) not to
terminate or revoke the trust created by the Trust Agreement except as
permitted by Article VIII of the Trust Agreement, (ii) not to amend,
supplement, terminate or revoke or otherwise modify any provision of
the Trust Agreement in such a manner as to adversely affect the rights
of any such party without the prior written consent of such party and
(iii) to comply with all of the terms of the Trust Agreement, the
nonperformance of which would adversely affect such party;
(c) The Owner Trustee or any successor may resign or be
removed by the Holders as the Owner Trustee, a successor Owner Trustee
may be appointed and a corporation may become the Owner Trustee under
the Trust Agreement, only in accordance with the provisions of Article
IX of the Trust Agreement and, with respect to such appointment, with
the consent of the Lessee, which consent shall not be unreasonably
withheld or delayed;
(d) The Owner Trustee, in its capacity as the Owner Trustee
under the Trust Agreement, and not in its individual capacity, shall
not contract for, create, incur or
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assume any Indebtedness, or enter into any business or other activity
or enter into any contracts or agreements, other than pursuant to or
under the Operative Agreements;
(e) The Holders will not instruct the Owner Trustee to take
any action in violation of the terms of any Operative Agreement;
(f) Neither any Holder nor the Owner Trustee shall (i)
commence any case, proceeding or other action with respect to the Owner
Trustee under any existing or future law of any jurisdiction, domestic
or foreign, relating to bankruptcy, insolvency, reorganization,
arrangement, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or (ii) seek appointment of a
receiver, trustee, custodian or other similar official with respect to
the Owner Trustee or for all or any substantial benefit of the
creditors of the Owner Trustee; and neither any Holder nor the Owner
Trustee shall take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth
in this paragraph;
(g) The Owner Trustee shall give prompt notice to the Lessee,
the Holders and the Agent if the Owner Trustee's principal place of
business or chief executive office, or the office where the records
concerning the accounts or contract rights relating to any Property are
kept, shall cease to be located at ▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, or if it shall change its name; and
(h) The Owner Trustee shall take or refrain from taking such
actions and grant or refrain from granting such approvals with respect
to the Operative Agreements and/or relating to any Property in each
case as directed in writing by the Agent (until such time as the Loans
are paid in full, and then by the Majority Holders) or, in connection
with Sections 8.5 and 9.2 hereof, the Lessee; provided, however, that
notwithstanding the foregoing provisions of this subparagraph (h) the
Owner Trustee, the Agent, the Lenders and the Holders each acknowledge,
covenant and agree that neither the Owner Trustee nor the Agent shall
act or refrain from acting, regarding each Unanimous Vote Matter until
such party has received the approval of each Lender and each Holder.
8.3. CREDIT PARTY COVENANTS, CONSENT AND ACKNOWLEDGMENT.
(a) Each Credit Party acknowledges and agrees that the Owner
Trustee, pursuant to the terms and conditions of the Security Agreement
and the Mortgage Instruments, shall create Liens in favor of the Agent
respecting the various personal property, fixtures and real property
described therein to secure the Owner Trustee's obligations under this
Agreement and under the other Operative Agreements. Each Credit Party
hereby irrevocably consents to the creation, perfection and maintenance
of such Liens. Each Credit Party shall, to the extent reasonably
requested by any of the other parties hereto, cooperate with the other
parties in connection with their covenants herein or in the other
Operative Agreements and shall from time to time duly execute and
deliver any and all such future instruments, documents and financing
statements (and continuation statements related thereto) as any other
party hereto may reasonably request.
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(b) The Lessor hereby instructs each Credit Party, and each
Credit Party hereby acknowledges and agrees, that until such time as
the Loans and the Holder Advances are paid in full and the Liens
evidenced by the Security Agreement and the Mortgage Instruments have
been released (i) any and all Rent (excluding Excepted Payments which
shall be payable to each Holder or other Person as appropriate) and any
and all other amounts of any kind or type under any of the Operative
Agreements due and owing or payable to any Person shall instead be paid
directly to the Agent (excluding Excepted Payments which shall be
payable to each Holder or other Person as appropriate) or as the Agent
may direct from time to time for allocation and distribution in
accordance with the procedures set forth in Section 8.7 hereof, (ii)
all rights of the Lessor under the Lease shall be exercised by the
Agent and (iii) each Credit Party shall cause all notices,
certificates, financial statements, communications and other
information which are delivered, or are required to be delivered, to
the Lessor, to also to be delivered at the same time to the Agent.
(c) No Credit Party shall consent to or permit any amendment,
supplement or other modification of the terms or provisions of any
Operative Agreement except in accordance with Section 12.5 of this
Agreement.
(d) The Lessee hereby covenants and agrees to cause an
Appraisal or reappraisal (in form and substance satisfactory to the
Agent and from an appraiser selected by the Agent) to be issued
respecting any Property as requested by the Agent (i) at each and every
time as such shall be required to satisfy any regulatory requirements
imposed on the Agent, the Lessor, the Trust Company, any Lender and/or
any Holder and (ii) after the occurrence of an Event of Default.
(e) Each Credit Party hereby covenants and agrees that, except
for amounts payable as Basic Rent, any and all payment obligations
owing from time to time under the Operative Agreements by any Person to
the Agent, any Lender, any Holder or any other Person shall (without
further action) be deemed to be Supplemental Rent obligations payable
by the Lessee and guaranteed by the other Credit Parties. Without
limitation, such obligations of the Lessee shall include without
limitation arrangement fees, administrative fees, facility fees,
breakage costs, indemnities, trustee fees and transaction expenses
incurred by the parties hereto in connection with the transactions
contemplated by the Operative Agreements.
(f) At any time the Lessor or the Agent is entitled under the
Operative Agreements to possession of a Property or any component
thereof, each of the Construction Agent and the Lessee hereby covenants
and agrees, at its own cost and expense, to assemble and make the same
available to the Agent (on behalf of the Lessor).
(g) The Lessee hereby covenants and agrees that Equipment
respecting any individual Property (exclusive of fixtures which are
integral and necessary for the structure and/or mechanical operation of
such Property) shall at no time constitute in
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excess of fifteen percent (15%) of the aggregate Advances respecting
such Property funded at such time under the Operative Agreements.
(h) The Lessee hereby covenants and agrees that (i) as of
Completion (A) the Property Cost for each individual parcel of the
Property shall be no less than $750,000 and (B) each parcel of the
Property shall be a Permitted Facility and (ii) the aggregate Property
Cost for all Properties at any time shall not exceed $35,000,000.
(i) The Lessee hereby covenants and agrees that it shall give
prompt notice to the Agent if the Lessee's principal place of business
or chief executive office, or the office where the records concerning
the accounts or contract rights relating to any Property are kept,
shall cease to be located at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ or if it shall change its name.
(j) The Lessee hereby covenants and agrees that the aggregate
Property Cost of Properties purchased for any reason by the Lessee
pursuant to the Purchase Option of Lessee and/or sold for any reason to
any Person pursuant to the Sale Option of Lessee prior to the
Expiration Date shall not exceed the lesser of (i) thirty-three percent
(33%) of the aggregate Property Cost (up to and including the date any
such Election Date is specified by Lessee) for all Properties then
subject to the Lease and all other properties which were previously
Properties subject to the Lease and (ii) Twelve Million Dollars
($12,000,000). To the extent any such purchase pursuant to the Purchase
Option and/or sale pursuant to the Sale Option shall occur prior to the
Construction Period Termination Date, then the aggregate amount paid to
the Agent (for the benefit of the Financing Parties with respect to any
such Purchase Option and/or Sale Option) shall remain available for
future Advances until the Construction Period Termination Date;
provided in no event shall any Lender be obligated to lend more than
its Lender Commitment and in no event shall any Holder be obligated to
advance more than its Holder Commitment.
(k) The Lessee shall furnish to the Agent at such times as
required under the Lessee Credit Agreement the financial statements and
other information required to be delivered pursuant to Section 5.1 and
Section 5.2 of the Lessee Credit Agreement.
(l) The Lessee hereby covenants and agrees that the rights of
the Lessee under this Agreement and the Lease shall not impair or in
any way diminish the obligations of the Construction Agent and/or the
rights of the Lessor under the Agency Agreement.
(m) The Lessee shall, on or before the first day of each
fiscal quarter of the Lessee, furnish to the Agent a written notice
setting forth the Lessee's calculation, in reasonable detail, of the
ratio of Consolidated Adjusted Rate to Annualized Consolidated EBITDAR
for the immediately preceding fiscal quarter of the Lessee.
(n) Each Credit Party shall promptly notify the Agent, or
cause the Agent to be promptly notified, upon such Credit Party gaining
knowledge of the occurrence of any Default or Event of Default which is
continuing at such time. In any event, such notice
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shall be provided to the Agent within ten (10) days of when such Credit
Party gains such knowledge.
(o) Until all of the obligations under the Operative
Agreements have been finally and indefeasibly paid and satisfied in
full and the Commitments and the Holder Commitments terminated unless
consent has been obtained from the Majority Secured Parties, each
Credit Party will:
(i) except as permitted by the express provisions of
the Lessee Credit Agreement, preserve and maintain its
separate legal existence and all rights, franchises, licenses
and privileges necessary to the conduct of its business, and
qualify and remain qualified as a foreign corporation (or
partnership, limited liability company or other such similar
entity, as the case may be) and authorized to do business in
each jurisdiction in which the failure to do so qualify would
have a Material Adverse Effect;
(ii) pay and perform all obligations of the Credit
Parties under the Operative Agreements and pay and perform (A)
all taxes, assessments and other governmental charges that may
be levied or assessed upon it or any of its property, and (B)
all other indebtedness, obligations and liabilities in
accordance with customary trade practices, which if not paid
would have a Material Adverse Effect; provided that any Credit
Party may in each case contest any item described in this
Section 8.3(n)(ii) in good faith so long as adequate reserves
are maintained with respect thereto in accordance with GAAP;
(iii) to the extent failure to do so would have a
Material Adverse Effect, (A) observe and remain in compliance
with all applicable Laws and maintain in full force and effect
all Governmental Actions, in each case applicable to the
conduct of its business; (B) keep in full force and effect all
licenses, certifications or accreditations necessary for any
Facility to carry on its business; and (C) not permit the
termination of any insurance reimbursement program available
to any Facility; and
(iv) provided that the Agent, the Lenders and the
Holders use reasonable efforts to minimize disruption to the
business of Credit Parties, permit representatives of the
Agent or any Lender or Holder, from time to time, to visit and
inspect its properties; inspect, audit and make extracts from
its books, records and files, including without limitation
management letters prepared by independent accountants; and
discuss with its principal officers, and its independent
accountants, its business, assets, liabilities, financial
condition, results of operations and business prospects.
(p) Lessee shall take all action necessary to assure that
Lessee's computer based systems are able to operate and effectively
process data including dates on and after
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January 1, 2000. At the request of the Agent, Lessee shall provide
Agent assurance acceptable to Agent of Lessee's Year 2000
compatibility.
(q) Lessee shall perform any and all obligations of Lessor
under, and cause Lessee to otherwise remain in full compliance with,
the terms and provisions of each Ground Lease, if any.
(r) Each Credit Party hereby covenants and agrees to cause
each of its Wholly-Owned Entities formed after the Initial Closing Date
to execute a Joinder Agreement and to observe the terms of Section 5.9
of this Agreement, all within thirty (30) days of the formation or
acquisition of each such Wholly-Owned Entity.
(s) Concurrently with the delivery of the financial statements
required pursuant to Section 28.1 of the Lease, the Lessee shall
deliver a Compliance Certificate with respect to the period covered by
the financial statements then being delivered, together with an
Interest Rate Calculation Worksheet (in the form attached to the
Compliance Certificate) and a Covenant Compliance Worksheet (in the
form attached to the Compliance Certificate) reflecting the computation
of the financial covenants incorporated pursuant to Section 28.1 of the
Lease as of the last day of the period covered by such financial
statements.
8.4. SHARING OF CERTAIN PAYMENTS.
Except for Excepted Payments, the parties hereto acknowledge and agree
that all payments due and owing by any Credit Party to the Lessor under the
Lease or any of the other Operative Agreements shall be made by such Credit
Party directly to the Agent as more particularly provided in Section 8.3 hereof.
The Lessor, the Holders, the Agent, the Lenders and the Credit Parties
acknowledge the terms of Section 8.7 of this Agreement regarding the allocation
of payments and other amounts made or received from time to time under the
Operative Agreements and agree, that all such payments and amounts are to be
allocated as provided in Section 8.7 of this Agreement.
8.5. GRANT OF EASEMENTS, ETC.
The Agent, the Lenders and the Holders hereby agree that, so long as no
Event of Default shall have occurred and be continuing, the Owner Trustee shall,
from time to time at the request of the Lessee (and with the prior consent of
the Agent), in connection with the transactions contemplated by the Agency
Agreement, the Lease or the other Operative Agreements, (i) grant easements and
other rights in the nature of easements with respect to any Property, (ii)
release existing easements or other rights in the nature of easements which are
for the benefit of any Property, (iii) execute and deliver to any Person any
instrument appropriate to confirm or effect such grants or releases, and (iv)
execute and deliver to any Person such other documents or materials in
connection with the acquisition, development, construction, testing or operation
of any Property, including without limitation reciprocal easement agreements,
construction contracts, operating agreements, development agreements, plats,
replats or subdivision
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documents; provided, that each of the agreements referred to in this Section 8.5
shall be of the type normally executed by the Lessee in the ordinary course of
the Lessee's business and shall be on commercially reasonable terms so as not to
diminish the value of any Property in any material respect.
8.6. APPOINTMENT BY THE AGENT, THE LENDERS, THE HOLDERS AND THE
OWNER TRUSTEE.
The Holders hereby appoint the Agent to act as collateral agent for the
Holders in connection with the Lien granted by the Security Documents to secure
the Holder Amount. The Lenders and the Holders acknowledge and agree and direct
that the rights and remedies of the beneficiaries of the Lien of the Security
Documents shall be exercised by the Agent on behalf of the Lenders and the
Holders as directed from time to time by the Majority Secured Parties or,
pursuant to Sections 8.2(h) and 12.5, all of the Lenders and the Holders, as the
case may be; provided, in all cases, the Agent shall allocate payments and other
amounts received in accordance with Section 8.7 of this Agreement. The Agent is
further appointed to provide notices under the Operative Agreements on behalf of
the Owner Trustee (as determined by the Agent, in its reasonable discretion), to
receive notices under the Operative Agreements on behalf of the Owner Trustee
and (subject to Sections 8.5 and 9.2) to take such other action under the
Operative Agreements on behalf of the Owner Trustee as the Agent shall determine
in its reasonable discretion from time to time. The Agent hereby accepts such
appointments. For purposes hereof, the provisions of Section 7 of the Credit
Agreement, together with such other terms and provisions of the Credit Agreement
and the other Operative Agreements as required for the full interpretation and
operation of Section 7 of the Credit Agreement are hereby incorporated by
reference as if restated herein for the mutual benefit of the Agent and each
Holder as if each Holder were a Lender thereunder. Outstanding Holder Advances
and outstanding Loans shall each be taken into account for purposes of
determining Majority Secured Parties. Further, the Agent shall be entitled to
take such action on behalf of the Owner Trustee as is delegated to the Agent
under any Operative Agreement (whether express or implied) as may be reasonably
incidental thereto. The parties hereto hereby agree to the provisions contained
in this Section 8.6. Any appointment of a successor agent under Section 7.9 of
the Credit Agreement shall also be effective as an appointment of a successor
agent for purposes of this Section 8.6.
8.7. COLLECTION AND ALLOCATION OF PAYMENTS AND OTHER AMOUNTS.
(a) Each Credit Party has agreed pursuant to the terms of this
Agreement to pay to (i) the Agent any and all Rent (excluding Excepted
Payments) and any and all other amounts of any kind or type under any
of the Operative Agreements due and owing or payable to any Person and
(ii) each Person as appropriate the Excepted Payments. Promptly after
receipt, the Agent shall apply and allocate, in accordance with the
terms of this Section 8.7, such amounts received from any Credit Party
and all other payments, receipts and other consideration of any kind
whatsoever received by the Agent pursuant to the Security Agreement or
otherwise received by the Agent, the Holders or any of the Lenders in
connection with the Collateral, the Security Documents or any of the
other Operative Agreements. Ratable distributions among the Lenders and
the Holders under this Section 8.7 shall be made based on (in the case
of the Lenders) the ratio of the
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outstanding Loans to the aggregate Property Cost and (in the case of
the Holders) the ratio of the outstanding Holder Advances to the
aggregate Property Cost. Ratable distributions among the Tranche A
Lenders under this Section 8.7 shall be made based on the ratio of the
individual Tranche A Lender's Commitment for Tranche A Loans to the
aggregate of all the Tranche A Lenders' Commitments for Tranche A
Loans. Ratable distributions among the Tranche B Lenders under this
Section 8.7 shall be made based on the ratio of the individual Tranche
B Lender's Commitment for Tranche B Loans to the aggregate of all the
Tranche B Lenders' Commitments for Tranche B Loans. Ratable
distributions among the Lenders (in situations where the Tranche A
Lenders are not differentiated from the Tranche B Lenders) shall be
made based on the ratio of the individual Lender's Commitment to the
aggregate of all the Lenders' Commitments. Ratable distributions among
the Holders under this Section 8.7 shall be based on the ratio of the
individual Holder's Holder Commitment to the aggregate of all the
Holders' Holder Commitments.
(b) Payments and other amounts received by the Agent from time
to time in accordance with the terms of subparagraph (a) shall be
applied and allocated as follows:
(i) Any such payment or amount identified as or
deemed to be Basic Rent shall be applied and allocated by the
Agent first, ratably to the Lenders and the Holders for
application and allocation to the payment of interest on the
Loans and thereafter the principal of the Loans which is due
and payable on such date and to the payment of accrued Holder
Yield with respect to the Holder Advances and thereafter the
portion of the Holder Advances which is due on such date; and
second, if no Default or Event of Default is in effect, any
excess shall be paid to such Person or Persons as the Lessee
may designate; provided, that if a Default or Event of Default
is in effect, such excess (if any) shall instead be held by
the Agent until the earlier of (I) the first date thereafter
on which no Default or Event of Default shall be in effect (in
which case such payments or returns shall then be made to such
other Person or Persons as the Lessee may designate) and (II)
the Maturity Date or the Expiration Date, as the case may be
(or, if earlier, the date of any Acceleration), in which case
such amounts shall be applied and allocated in the manner
contemplated by Section 8.7(b)(iv).
(ii) If on any date the Agent or the Lessor shall
receive an amount (if any) in respect of (A) any Casualty or
Condemnation pursuant to Sections 15.1(a) or 15.1(g) of the
Lease (excluding any payments in respect thereof which are
payable to the Lessee in accordance with the Lease), or (B)
the Termination Value in connection with the delivery of a
Termination Notice pursuant to Article XVI of the Lease, or
(C) the Termination Value in connection with the exercise of
the Purchase Option under Section 20.1 of the Lease or the
exercise of the option of the Lessor to transfer the
Properties to the Lessee pursuant to Section 20.3 of the
Lease, or (D) any payment required to be made or elected to be
made by the Construction Agent to the Lessor pursuant to the
terms of the Agency Agreement, then in each case, the Lessor
shall be required to pay such amount received (1) if
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no Acceleration has occurred, to prepay the principal balance
of the Loans and the Holder Advances, on a pro rata basis, a
portion of such amount to be distributed to the Lenders and
the Holders or (2) if an Acceleration has occurred, to apply
and allocate the proceeds respecting Sections 8.7(b)(ii)(A)
through 8.7(b)(ii)(D) in accordance with Section 8.7(b)(iii)
hereof.
(iii) Subject to Section 8.7(c), an amount equal to
any payment identified as proceeds of the sale or other
disposition (or lease upon the exercise of remedies) of the
Properties or any portion thereof, whether pursuant to Article
XXII of the Lease or the exercise of remedies under the
Security Documents or otherwise, the execution of remedies set
forth in the Lease and any payment in respect of excess wear
and tear pursuant to Section 22.3 of the Lease (whether such
payment relates to a period before or after the Construction
Period Termination Date) shall be applied and allocated by the
Agent first, ratably to the payment of the principal and
interest of the Tranche B Loans then outstanding, second,
ratably to the payment to the Holders of the outstanding
principal balance of all Holder Advances plus all outstanding
Holder Yield with respect to such outstanding Holder Advances,
third, to the extent such amount exceeds the maximum amount to
be returned pursuant to the foregoing provisions of this
paragraph (iii), ratably to the payment of the principal and
interest of the Tranche A Loans then outstanding, fourth, to
any and all other amounts owing under the Operative Agreements
to the Lenders under the Tranche B Loans, fifth, to any and
all other amounts owing under the Operative Agreements to the
Holders, sixth, to any and all other amounts owing under the
Operative Agreements to the Lenders under the Tranche A Loans,
and seventh, to the extent moneys remain after application and
allocation pursuant to clauses first through sixth above, to
the Owner Trustee for application and allocation to any and
all other amounts owing to the Holders or the Owner Trustee
and as the Holders shall determine; provided, where no Event
of Default shall exist and be continuing and a prepayment is
made for any reason with respect to less than the full amount
of the outstanding principal amount of the Loans and the
outstanding Holder Advances, the proceeds shall be applied and
allocated ratably to the Lenders and to the Holders.
(iv) Subject to Section 8.7(c), an amount equal to
(A) any such payment identified as a payment pursuant to
Section 22.1(b) of the Lease (or otherwise) of the Maximum
Residual Guarantee Amount (and any such lesser amount as may
be required by Section 22.1(b) of the Lease) in respect of the
Properties, (B) any other amount payable upon any exercise of
remedies after the occurrence of an Event of Default not
covered by Sections 8.7(b)(i) or 8.7(b)(iii) above (including
without limitation any amount received in connection with an
Acceleration which does not represent proceeds from the sale
or liquidation of the Properties) and (C) any other amount
payable by any Guarantor pursuant to Section 6B (including
without limitation from collateral securing obligations of one
or more of the Credit Parties under the Operative Agreements
and the obligations of one or more of the Credit Parties under
the Lessee Credit
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Agreement and the transactions related thereto) shall be
applied and allocated by the Agent first, ratably, to the
payment of the principal and interest balance of Tranche A
Loans then outstanding, second, ratably to the payment of the
principal and interest balance of the Tranche B Loans then
outstanding, third, ratably to the payment of the principal
balance of all Holder Advances plus all outstanding Holder
Yield with respect to such outstanding Holder Advances,
fourth, to the payment of any other amounts owing to the
Lenders hereunder or under any of the other Operative
Agreement, and fifth, to the extent moneys remain after
application and allocation pursuant to clauses first through
fourth above, to the Owner Trustee for application and
allocation to Holder Advances and Holder Yield and any other
amounts owing to the Holders or the Owner Trustee as the
Holders shall determine.
(v) An amount equal to any such payment identified as
Supplemental Rent shall be applied and allocated by the Agent
to the payment of any amounts then owing to the Agent, the
Lenders, the Holders and the other parties to the Operative
Agreements (or any of them) (other than any such amounts
payable pursuant to the preceding provisions of this Section
8.7(b)) as shall be determined by the Agent in its reasonable
discretion; provided, however, that Supplemental Rent received
upon the exercise of remedies after the occurrence and
continuance of an Event of Default in lieu of or in
substitution of the Maximum Residual Guarantee Amount or as a
partial payment thereon shall be applied and allocated as set
forth in Section 8.7(b)(iv).
(vi) The Agent in its reasonable judgment shall
identify the nature of each payment or amount received by the
Agent and apply and allocate each such amount in the manner
specified above.
(c) Upon the termination of the Commitments and the payment in
full of the Loans and all other amounts owing by the Owner Trustee
hereunder or under any Credit Document and the payment in full of all
amounts owing to the Holders and the Owner Trustee under the Trust
Agreement, any moneys remaining with the Agent shall be returned to the
Owner Trustee or such other Person or Persons as the Holders may
designate for application and allocation to any and all other amounts
owing to the Holders or the Owner Trustee and as the Holders shall
determine. In the event of an Acceleration it is agreed that, prior to
the application and allocation of amounts received by the Agent in the
order described in Section 8.7(b) above, any such amounts shall first
be applied and allocated to the payment of (i) any and all sums
advanced by the Agent in order to preserve the Collateral or to
preserve its Lien thereon, (ii) the expenses of retaking, holding,
preparing for sale or lease, selling or otherwise disposing or
realizing on the Collateral, or of any exercise by the Agent of its
rights under the Security Documents, together with reasonable
attorneys' fees and expenses and court costs and (iii) any and all
other amounts reasonably owed to the Agent under or in connection with
the transactions contemplated by the Operative Agreements (including
without limitation any accrued and unpaid administration fees).
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8.8. RELEASE OF PROPERTIES, ETC.
If the Lessee shall at any time purchase any Property pursuant to the
Lease, or the Construction Agent shall purchase any Property pursuant to the
Agency Agreement, or if any Property shall be sold in accordance with Article
XXII of the Lease, then, upon satisfaction by the Owner Trustee of its
obligation to prepay the Loans, Holder Advances and all other amounts owing to
the Lenders and the Holders under the Operative Agreements, the Agent is hereby
authorized and directed to release such Properties from the Liens created by the
Security Documents to the extent of its interest therein. In addition, upon the
termination of the Commitments and the Holder Commitments and the payment in
full of the Loans, the Holder Advances and all other amounts owing by the Owner
Trustee hereunder or under any other Operative Agreement the Agent is hereby
authorized and directed to release all of the Properties from the Liens created
by the Security Documents to the extent of its interest therein. Upon request of
the Owner Trustee following any such release, the Agent shall, at the sole cost
and expense of the Lessee, execute and deliver to the Owner Trustee and the
Lessee such documents as the Owner Trustee or the Lessee shall reasonably
request to evidence such release.
SECTION 9. CREDIT AGREEMENT AND TRUST AGREEMENT.
9.1. THE CONSTRUCTION AGENT'S AND THE LESSEE'S CREDIT AGREEMENT RIGHTS.
Notwithstanding anything to the contrary contained in the Credit
Agreement, the Agent, the Lenders, the Holders, the Credit Parties and the Owner
Trustee hereby agree that, prior to the occurrence and continuation of any
Default or Event of Default, the Construction Agent or the Lessee, as the case
may be, shall have the following rights:
(a) the right to designate an account to which amounts funded
under the Operative Agreements shall be credited pursuant to Section
2.3(a) of the Credit Agreement;
(b) the right to terminate or reduce the Commitments pursuant
to Section 2.5(a) of the Credit Agreement;
(c) the right to exercise the conversion and continuation
options pursuant to Section 2.7 of the Credit Agreement;
(d) the right to approve any successor agent pursuant to
Section 7.9 of the Credit Agreement;
(e) the right to consent to any assignment by a Lender to
which the Lessor has the right to consent pursuant to Section 9.8 of
the Credit Agreement; and
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(f) without limiting the foregoing clauses (a) through (e),
and in addition thereto, provided, that no Event of Default then
exists, the Construction Agent or the Lessee, as the case may be, shall
have the right to exercise any other right of the Owner Trustee under
the Credit Agreement upon not less than five (5) Business Days' prior
written notice from the Construction Agent or the Lessee, as the case
may be, to the Owner Trustee and the Agent.
9.2. THE CONSTRUCTION AGENT'S AND THE LESSEE'S TRUST AGREEMENT
RIGHTS.
Notwithstanding anything to the contrary contained in the Trust
Agreement, the Credit Parties, the Owner Trustee and the Holders hereby agree
that, prior to the occurrence and continuation of any Default or Event of
Default, the Construction Agent or the Lessee, as the case may be, shall have
the following rights:
(a) the right to exercise the conversion and continuation
options pursuant to Section 3.8 of the Trust Agreement and the right to
terminate or reduce the Holder Commitments pursuant to Section 3.9 of
the Trust Agreement;
(b) no removal of the Owner Trustee and appointment of a
successor Owner Trustee pursuant to Section 9.1 of the Trust Agreement
shall be made without the prior written consent (not to be unreasonably
withheld or delayed) of the Lessee; and
(c) the Holders and the Owner Trustee shall not amend,
supplement or otherwise modify any provision of the Trust Agreement in
such a manner as to adversely affect the rights of the Construction
Agent or the Lessee, as the case may be, without the prior written
consent (not to be unreasonably withheld or delayed) of the
Construction Agent or the Lessee, as the case may be.
SECTION 10. TRANSFER OF INTEREST.
10.1. RESTRICTIONS ON TRANSFER.
Each Lender may participate, assign or transfer all or a portion of its
interest hereunder and under the other Operative Agreements in accordance with
Sections 9.7 and 9.8 of the Credit Agreement; provided, each participant,
assignee or transferee must obtain the same ratable interest in Tranche A Loans,
Tranche B Loans and the Lessee Credit Agreement. The Holders may, directly or
indirectly, assign, convey or otherwise transfer any of their right, title or
interest in or to the Trust Estate or the Trust Agreement with the prior written
consent of the Agent and the Lessee (which consent shall not be unreasonably
withheld or delayed) and in accordance with the terms of Section 11.8(b) of the
Trust Agreement. The Owner Trustee may, subject to the rights of the Lessee
under the Lease and the other Operative Agreements and to the Lien of the
applicable Security Documents but only with the prior written consent of the
Agent (which consent may be withheld by the Agent in its sole discretion) and
(provided, no Default or Event of Default has occurred and is continuing) with
the consent of the Lessee, directly or indirectly,
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assign, convey, appoint an agent with respect to enforcement of, or otherwise
transfer any of its right, title or interest in or to any Property, the Lease,
the Trust Agreement and the other Operative Agreements (including without
limitation any right to indemnification thereunder), or any other document
relating to a Property or any interest in a Property as provided in the Trust
Agreement and the Lease. The provisions of the immediately preceding sentence
shall not apply to the obligations of the Owner Trustee to transfer Property to
the Lessee or a third party purchaser pursuant to Article XXII of the Lease upon
payment for such Property in accordance with the terms and conditions of the
Lease. No Credit Party may assign any of the Operative Agreements or any of
their respective rights or obligations thereunder or with respect to any
Property in whole or in part to any Person without the prior written consent of
the Agent, the Lenders, the Holders and the Lessor.
10.2. EFFECT OF TRANSFER.
From and after any transfer effected in accordance with this Section
10, the transferor shall be released, to the extent of such transfer, from its
liability hereunder and under the other documents to which it is a party in
respect of obligations to be performed on or after the date of such transfer;
provided, however, that any transferor shall remain liable hereunder and under
such other documents to the extent that the transferee shall not have assumed
the obligations of the transferor thereunder. Upon any transfer by the Owner
Trustee, a Holder or a Lender as above provided, any such transferee shall
assume the obligations of the Owner Trustee, the Holder or the Lender, as the
case may be, and shall be deemed an "Owner Trustee", "Holder", or "Lender", as
the case may be, for all purposes of such documents and each reference herein to
the transferor shall thereafter be deemed a reference to such transferee for all
purposes, except as provided in the preceding sentence. Notwithstanding any
transfer of all or a portion of the transferor's interest as provided in this
Section 10, the transferor shall be entitled to all benefits accrued and all
rights vested prior to such transfer including without limitation rights to
indemnification under any such document.
SECTION 11. INDEMNIFICATION.
11.1. GENERAL INDEMNITY.
Whether or not any of the transactions contemplated hereby shall be
consummated, the Indemnity Provider hereby assumes liability for and agrees to
defend, indemnify and hold harmless each Indemnified Person on an After Tax
Basis from and against any Claims, which may be imposed on, incurred by or
asserted against an Indemnified Person by any third party, including without
limitation Claims arising from the negligence of an Indemnified Person (but not
to the extent such Claims arise from the gross negligence or willful misconduct
of such Indemnified Person itself, as determined by a court of competent
jurisdiction or pursuant to arbitration as set forth in Section 12.8, as opposed
to gross negligence or willful misconduct imputed to such Indemnified Person
with regard to the acts or omissions of any Person which is not an agent or
employee of such Indemnified Person; provided, no Indemnified Person shall be
responsible for the acts or omissions of the Construction Agent regardless of
any agency status)
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in any way relating to or arising or alleged to arise out of the execution,
delivery, performance or enforcement of this Agreement, the Lease or any other
Operative Agreement or on or with respect to any Property or any component
thereof, including without limitation Claims in any way relating to or arising
or alleged to arise out of (a) the financing, refinancing, purchase, acceptance,
rejection, ownership, design, construction, refurbishment, development,
delivery, acceptance, nondelivery, leasing, subleasing, possession, use,
operation, maintenance repair, modification, transportation, condition, sale,
return, repossession (whether by summary proceedings or otherwise), or any other
disposition of any Property or any part thereof, including without limitation
the acquisition, holding or disposition of any interest in the Property, lease
or agreement comprising a portion of any thereof; (b) any latent or other
defects in any Property or any portion thereof whether or not discoverable by an
Indemnified Person or the Indemnity Provider; (c) a violation of Environmental
Laws, Environmental Claims or other loss of or damage to any property or the
environment relating to the Property, the Lease, the Agency Agreement or the
Indemnity Provider; (d) the Operative Agreements, or any transaction
contemplated thereby; (e) any breach by the Indemnity Provider of any of its
representations or warranties under the Operative Agreements to which the
Indemnity Provider is a party or failure by the Indemnity Provider to perform or
observe any covenant or agreement to be performed by it under any of the
Operative Agreements; (f) the transactions contemplated hereby or by any other
Operative Agreement, in respect of the application of Parts 4 and 5 of Subtitle
B of Title I of ERISA; and (g) personal injury, death or property damage,
including without limitation Claims based on strict or absolute liability in
tort. Without limiting the generality of the foregoing, Environmental Claims
shall include without limitation amounts paid in settlement of claims, all
consultant and expert fees and expenses of any Indemnified Person incurred in
connection with any investigation of site conditions, any abatement, cleanup,
remediation, removal or restoration work, or liability for any damages or
injuries of any Person or to land, air, water or other natural resources.
If a written Claim is made against any Indemnified Person or if any
proceeding shall be commenced against such Indemnified Person (including without
limitation a written notice of such proceeding), for any Claim, such Indemnified
Person shall promptly notify the Indemnity Provider in writing and shall not
take action with respect to such Claim without the consent of the Indemnity
Provider for thirty (30) days after the receipt of such notice by the Indemnity
Provider; provided, however, that in the case of any such Claim, if action shall
be required by law or regulation to be taken prior to the end of such period of
thirty (30) days, such Indemnified Person shall endeavor to, in such notice to
the Indemnity Provider, inform the Indemnity Provider of such shorter period,
and no action shall be taken with respect to such Claim without the consent of
the Indemnity Provider before seven (7) days before the end of such shorter
period; provided, further, that the failure of such Indemnified Person to give
the notices referred to in this sentence shall not diminish the Indemnity
Provider's obligation hereunder except to the extent such failure precludes in
all respects the Indemnity Provider from contesting such Claim.
If, within thirty (30) days of receipt of such notice from the
Indemnified Person (or such shorter period as the Indemnified Person has
notified the Indemnity Provider is required by law or regulation for the
Indemnified Person to respond to such Claim), the Indemnity Provider shall
request in writing that such Indemnified Person respond to such Claim, the
Indemnified Person
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shall, at the expense of the Indemnity Provider, in good faith conduct and
control such action (including without limitation by pursuit of appeals)
(provided, however, that (A) if such Claim, in the Indemnity Provider's
reasonable discretion, can be pursued by the Indemnity Provider on behalf of or
in the name of such Indemnified Person, the Indemnified Person, at the Indemnity
Provider's request, shall allow the Indemnity Provider to conduct and control
the response to such Claim and (B) in the case of any Claim (and notwithstanding
the provisions of the foregoing subsection (A)), the Indemnified Person may
request the Indemnity Provider to conduct and control the response to such Claim
(with counsel to be selected by the Indemnity Provider and consented to by such
Indemnified Person, such consent not to be unreasonably withheld; provided,
however, that any Indemnified Person may retain separate counsel at the expense
of the Indemnity Provider in the event of a conflict of interest between such
Indemnified Person and the Indemnity Provider)) by, in the sole discretion of
the Person conducting and controlling the response to such Claim (1) resisting
payment thereof, (2) not paying the same except under protest, if protest is
necessary and proper, (3) if the payment be made, using reasonable efforts to
obtain a refund thereof in appropriate administrative and judicial proceedings,
or (4) taking such other action as is reasonably requested by the Indemnity
Provider from time to time.
The party controlling the response to any Claim shall consult in good
faith with the non-controlling party and shall keep the non-controlling party
reasonably informed as to the conduct of the response to such Claim; provided,
that all decisions ultimately shall be made in the discretion of the controlling
party. The parties agree that an Indemnified Person may at any time decline to
take further action with respect to the response to such Claim and may settle
such Claim if such Indemnified Person shall waive its rights to any indemnity
from the Indemnity Provider that otherwise would be payable in respect of such
Claim (and any future Claim, the pursuit of which is precluded by reason of such
resolution of such Claim) and shall pay to the Indemnity Provider any amount
previously paid or advanced by the Indemnity Provider pursuant to this Section
11.1 by way of indemnification or advance for the payment of an amount regarding
such Claim.
Notwithstanding the foregoing provisions of this Section 11.1, an
Indemnified Person shall not be required to take any action and no Indemnity
Provider shall be permitted to respond to any Claim in its own name or that of
the Indemnified Person unless (A) the Indemnity Provider shall have agreed to
pay and shall pay to such Indemnified Person on demand and on an After Tax Basis
all reasonable costs, losses and expenses that such Indemnified Person actually
incurs in connection with such Claim, including without limitation all
reasonable legal, accounting and investigatory fees and disbursements and, if
the Indemnified Person has informed the Indemnity Provider that it intends to
contest such Claim (whether or not the control of the contest is then assumed by
the Indemnity Provider), the Indemnity Provider shall have agreed that the Claim
is an indemnifiable Claim hereunder, (B) in the case of a Claim that must be
pursued in the name of an Indemnified Person (or an Affiliate thereof), the
amount of the potential indemnity (taking into account all similar or logically
related Claims that have been or could be raised for which the Indemnity
Provider may be liable to pay an indemnity under this Section 11.1) exceeds
$25,000 (or such lesser amount as may be subsequently agreed between the
Indemnity Provider and the Indemnified Person), (C) the Indemnified Person shall
have
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reasonably determined that the action to be taken will not result in any
material danger of sale, forfeiture or loss of the Property, or any part thereof
or interest therein, will not interfere with the payment of Rent, and will not
result in risk of criminal liability, (D) if such Claim shall involve the
payment of any amount prior to the resolution of such Claim, the Indemnity
Provider shall provide to the Indemnified Person an interest-free advance in an
amount equal to the amount that the Indemnified Person is required to pay (with
no additional net after-tax cost to such Indemnified Person) prior to the date
such payment is due, (E) in the case of a Claim that must be pursued in the name
of an Indemnified Person (or an Affiliate thereof), the Indemnity Provider shall
have provided to such Indemnified Person an opinion of independent counsel
selected by the Indemnified Person and reasonably satisfactory to the Indemnity
Provider stating that a reasonable basis exists to contest such Claim (or, in
the case of an appeal of an adverse determination, an opinion of such counsel to
the effect that the position asserted in such appeal will more likely than not
prevail) and (F) no Event of Default shall have occurred and be continuing. In
no event shall an Indemnified Person be required to appeal an adverse judicial
determination to the United States Supreme Court. In addition, an Indemnified
Person shall not be required to contest any Claim in its name (or that of an
Affiliate) if the subject matter thereof shall be of a continuing nature and
shall have previously been decided adversely by a court of competent
jurisdiction pursuant to the contest provisions of this Section 11.1, unless
there shall have been a change in law (or interpretation thereof) and the
Indemnified Person shall have received, at the Indemnity Provider's expense, an
opinion of independent counsel selected by the Indemnified Person and reasonably
acceptable to the Indemnity Provider stating that as a result of such change in
law (or interpretation thereof), it is more likely than not that the Indemnified
Person will prevail in such contest. In no event shall the Indemnity Provider be
permitted to adjust or settle any Claim without the consent of the Indemnified
Person to the extent any such adjustment or settlement involves, or is
reasonably likely to involve, any performance by or adverse admission by or with
respect to the Indemnified Person.
11.2. GENERAL TAX INDEMNITY.
(a) The Indemnity Provider shall pay and assume liability for,
and does hereby agree to indemnify, protect and defend each Property
and all Indemnified Persons, and hold them harmless against, all
Impositions on an After Tax Basis, and all payments pursuant to the
Operative Agreements shall be made free and clear of and without
deduction for any and all present and future Impositions.
(b) Notwithstanding anything to the contrary in Section
11.2(a) hereof, the following shall be excluded from the indemnity
required by Section 11.2(a):
(i) Taxes (other than Taxes that are, or are in the
nature of, sales, use, rental, value added, transfer or
property taxes) that are imposed on a Indemnified Person
(other than the Lessor, the Owner Trustee and/or the Trust) by
the United States federal government that are based on or
measured by the net income (including without limitation taxes
based on capital gains and minimum taxes) of such Person;
provided, that this clause (i) shall not be interpreted to
prevent a
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payment from being made on an After Tax Basis if such payment
is otherwise required to be so made;
(ii) Taxes (other than Taxes that are, or are in the
nature of, sales, use, rental, value added, transfer or
property taxes) that are imposed on any Indemnified Person
(other than the Lessor) by any state or local jurisdiction or
taxing authority within any state or local jurisdiction and
that are based upon or measured by the net income (including
without limitation taxes based on capital gains and minimum
taxes) of such Person; provided that such Taxes shall not be
excluded under this subparagraph (ii) to the extent the
location, possession or use of any Property in, the location
or the operation of the Lessee in, or the Lessee's making
payments under the Operative Agreements from, the jurisdiction
imposing such Taxes been the sole connection between such
Indemnified Person and the jurisdiction imposing such Taxes;
provided, further, that this clause (ii) shall not be
interpreted to prevent a payment from being made on an After
Tax Basis if such payment is otherwise required to be so made;
(iii) any Tax to the extent it relates to any act,
event or omission that occurs after the termination of the
Lease and redelivery or sale of the property in accordance
with the terms of the Lease (but not any Tax that relates to
such termination, redelivery or sale and/or to any period
prior to such termination, redelivery or sale); and
(iv) any Taxes which are imposed on an Indemnified
Person as a result of the gross negligence or willful
misconduct of such Indemnified Person itself, as determined by
a court of competent jurisdiction (as opposed to gross
negligence or willful misconduct imputed to such Indemnified
Person with regard to the acts or omissions of any Person
which is not an agent or employee of such Indemnified Person;
provided, no Indemnified Person shall be responsible for the
acts or omissions of the Construction Agent regardless of any
agency status), but not Taxes imposed as a result of ordinary
negligence of such Indemnified Person;
(c) (i) Subject to the terms of Section 11.2(e), the
Indemnity Provider shall pay or cause to be paid all
Impositions directly to the taxing authorities where feasible
and otherwise to the Indemnified Person, as appropriate, and
the Indemnity Provider shall at its own expense, upon such
Indemnified Person's reasonable request, furnish to such
Indemnified Person copies of official receipts or other
satisfactory proof evidencing such payment.
(ii) In the case of Impositions for which no contest
is conducted pursuant to Section 11.2(e) and which the
Indemnity Provider pays directly to the taxing authorities,
the Indemnity Provider shall pay such Impositions prior to the
latest time permitted by the relevant taxing authority for
timely payment. In the case of Impositions for which the
Indemnity Provider reimburses an Indemnified Person, the
Indemnity Provider shall do so within thirty (30) days after
receipt by
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the Indemnity Provider of demand by such Indemnified Person
describing in reasonable detail the nature of the Imposition
and the basis for the demand (including without limitation the
computation of the amount payable), accompanied by receipts or
other reasonable evidence of such demand. In the case of
Impositions for which a contest is conducted pursuant to
Section 11.2(e), the Indemnity Provider shall pay such
Impositions or reimburse such Indemnified Person for such
Impositions, to the extent not previously paid or reimbursed
pursuant to subsection (a), prior to the latest time permitted
by the relevant taxing authority for timely payment after
conclusion of all contests under Section 11.2(e).
(iii) At the Indemnity Provider's request, the amount
of any indemnification payment by the Indemnity Provider
pursuant to subsection (a) shall be verified and certified by
an independent public accounting firm mutually acceptable to
the Indemnity Provider and the Indemnified Person. The fees
and expenses of such independent public accounting firm shall
be paid by the Indemnity Provider unless such verification
shall result in an adjustment in the Indemnity Provider's
favor of fifteen percent (15%) or more of the payment as
computed by the Indemnified Person, in which case such fee
shall be paid by the Indemnified Person.
(d) The Indemnity Provider shall be responsible for preparing
and filing any real and personal property or ad valorem tax returns in
respect of each Property and any other tax returns requested by the
Owner Trustee respecting the transactions described in the Operative
Agreements. In case any other report or tax return shall be required to
be made with respect to any obligations of the Indemnity Provider under
or arising out of subsection (a) and of which the Indemnity Provider
has knowledge or should have knowledge, the Indemnity Provider, at its
sole cost and expense, shall notify the relevant Indemnified Person of
such requirement and (except if such Indemnified Person notifies the
Indemnity Provider that such Indemnified Person intends to file such
report or return) (A) to the extent required or permitted by and
consistent with Legal Requirements, make and file in Indemnity
Provider's name such return, statement or report; and (B) in the case
of any other such return, statement or report required to be made in
the name of such Indemnified Person, advise such Indemnified Person of
such fact and prepare such return, statement or report for filing by
such Indemnified Person or, where such return, statement or report
shall be required to reflect items in addition to any obligations of
the Indemnity Provider under or arising out of subsection (a), provide
such Indemnified Person at the Indemnity Provider's expense with
information sufficient to permit such return, statement or report to be
properly made with respect to any obligations of the Indemnity Provider
under or arising out of subsection (a). Such Indemnified Person shall,
upon the Indemnity Provider's request and at the Indemnity Provider's
expense, provide any data maintained by such Indemnified Person (and
not otherwise available to or within the control of the Indemnity
Provider) with respect to each Property which the Indemnity Provider
may reasonably require to prepare any required tax returns or reports.
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(e) If a written Claim is made against any Indemnified Person
or if any proceeding shall be commenced against such Indemnified Person
(including without limitation a written notice of such proceeding), for
any Impositions, the provisions in Section 11.1 relating to
notification and rights to contest shall apply; provided, however, if
such contest involves a Tax other than a Tax on net income and can be
pursued independently from any other proceeding involving a tax
liability of such Indemnified Person, the Indemnified Person, at the
Indemnity Provider's request, shall allow the Indemnity Provider (and
the Indemnity Provider shall be obligated) to conduct and control such
contest.
11.3 INCREASED COSTS, ILLEGALITY, ETC.
Without limiting the rights of the Lessee under Section 11.6 of the
Participation Agreement:
(a) If, due to either (i) the introduction of or any change in
or in the interpretation of any law or regulation or (ii) the
compliance with any guideline or request hereafter adopted, promulgated
or made by any central bank or other governmental authority (whether or
not having the force of law), there shall be any increase in the cost
to any Financing Party of agreeing to make or making, funding or
maintaining Advances, then the Lessee shall from time to time, upon
demand by such Financing Party (with a copy of such demand to the Agent
but subject to the terms of Section 11.6 of the Participation
Agreement, as the case may be), pay to the Agent for the account of
such Financing Party additional amounts sufficient to compensate such
Financing Party for such increased cost. A certificate as to the amount
of such increased cost, submitted to the Lessee and the Agent by such
Financing Party, shall be conclusive and binding for all purposes,
absent manifest error.
(b) If any Financing Party determines that compliance with any
law or regulation or any guideline or request from any central bank or
other governmental authority (whether or not having the force of law,
but in each case promulgated or made after the date hereof) affects or
would affect the amount of capital required or expected to be
maintained by such Financing Party or any corporation controlling such
Financing Party and that the amount of such capital is increased by or
based upon the existence of such Financing Party's commitment to make
Advances and other commitments of this type or upon the Advances, then,
upon demand by such Financing Party (with a copy of such demand to the
Agent but subject to the terms Section 11.6 of the Participation
Agreement), the Lessee shall pay to the Agent for the account of such
Financing Party, from time to time as specified by such Financing
Party, additional amounts sufficient to compensate such Financing Party
or such corporation in the light of such circumstances, to the extent
that such Financing Party reasonably determines such increase in
capital to be allocable to the existence of such Financing Party's
commitment to make such Advances. A certificate as to such amounts
submitted to the Lessee and the Agent by such Financing Party shall be
conclusive and binding for all purposes, absent manifest error.
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(c) Without limiting the effect of the foregoing, the Lessee
shall pay to each Financing Party on the last day of the Interest
Period therefor so long as such Financing Party is maintaining reserves
against "Eurocurrency liabilities" under Regulation D an additional
amount (determined by such Financing Party and notified to the Lessee
through the Agent) equal to the product of the following for each
Eurodollar Loan or Eurodollar Holder Advance, as the case may be, for
each day during such Interest Period:
(i) the principal amount of such Eurodollar Loan or
Eurodollar Holder Advance, as the case may be, outstanding on
such day; and
(ii) the remainder of (x) a fraction the numerator
of which is the rate (expressed as a decimal) at which
interest accrues on such Eurodollar Loan or Eurodollar Holder
Advance, as the case may be, for such Interest Period as
provided in the Credit Agreement or the Trust Agreement, as
the case may be (less the Applicable Percentage), and the
denominator of which is one (1) minus the effective rate
(expressed as a decimal) at which such reserve requirements
are imposed on such Financing Party on such day minus (y) such
numerator; and
(iii) 1/360.
(d) Without affecting its rights under Sections 11.3(a),
11.3(b) or 11.3(c) or any other provision of any Operative Agreement,
each Financing Party agrees that if there is any increase in any cost
to or reduction in any amount receivable by such Financing Party with
respect to which the Lessee would be obligated to compensate such
Financing Party pursuant to Sections 11.3(a) or 11.3(b), such Financing
Party shall use reasonable efforts to select an alternative office for
Advances which would not result in any such increase in any cost to or
reduction in any amount receivable by such Financing Party; provided,
however, that no Financing Party shall be obligated to select an
alternative office for Advances if such Financing Party determines that
(i) as a result of such selection such Financing Party would be in
violation of any applicable law, regulation, treaty, or guideline, or
would incur additional costs or expenses or (ii) such selection would
be inadvisable for regulatory reasons or materially inconsistent with
the interests of such Financing Party.
(e) With reference to the obligations of the Lessee set forth
in Sections 11.3(a) through 11.3(d), the Lessee shall not have any
obligation to pay to any Financing Party amounts owing under such
Sections for any period which is more than one (1) year prior to the
date upon which the request for payment therefor is delivered to the
Lessee.
(f) Notwithstanding any other provision of this Agreement, if
any Financing Party shall notify the Agent that the introduction of or
any change in or in the interpretation of any law or regulation makes
it unlawful, or any central bank or other governmental authority
asserts that it is unlawful, for any Financing Party to perform its
obligations hereunder to make or maintain Eurodollar Loans or
Eurodollar Holder
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Advances, as the case may be, then (i) each Eurodollar Loan or
Eurodollar Holder Advance, as the case may be, will automatically, at
the earlier of the end of the Interest Period for such Eurodollar Loan
or Eurodollar Holder Advance, as the case may be, or the date required
by law, convert into an ABR Loan or an ABR Holder Advance, as the case
may be, and (iii) the obligation of the Financing Parties to make,
convert or continue Eurodollar Loans or Eurodollar Holder Advances, as
the case may be, shall be suspended until the Agent shall notify the
Lessee that such Financing Party has determined that the circumstances
causing such suspension no longer exist.
11.4 FUNDING/CONTRIBUTION INDEMNITY.
Subject to the provisions of Section 11.6 of the Participation
Agreement, the Lessee agrees to indemnify each Financing Party and to hold each
Financing Party harmless from any loss or reasonable expense which such
Financing Party may sustain or incur as a consequence of (a) any default in
connection with the drawing of funds for any Advance, (b) any default in making
any prepayment after a notice thereof has been given in accordance with the
provisions of the Operative Agreements or (c) the making of a voluntary or
involuntary prepayment of Eurodollar Loans or Eurodollar Holder Advances, as the
case may be, on a day which is not the last day of an Interest Period with
respect thereto. Such indemnification shall be in an amount equal to the excess,
if any, of (x) the amount of interest or Holder Yield, as the case may be, which
would have accrued on the amount so prepaid, or not so borrowed, accepted,
converted or continued for the period from the date of such prepayment or of
such failure to borrow, accept, convert or continue to the last day of such
Interest Period (or, in the case of a failure to borrow, accept, convert or
continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable Eurodollar Rate plus the Applicable
Percentage for such Loan or Holder Advance, as the case may be, for such
Interest Period over (y) the amount of interest (as determined by such Financing
Party in its reasonable discretion) which would have accrued to such Financing
Party on such amount by (i) (in the case of the Lenders) re-employing such funds
in loans of the same type and amount during the period from the date of
prepayment or failure to borrow to the last day of the then applicable Interest
Period (or, in the case of a failure to borrow, the Interest Period that would
have commenced on the date of such failure) and (ii) (in the case of the
Holders) placing such amount on deposit for a comparable period with leading
banks in the relevant interest rate market. This covenant shall survive the
termination of the Operative Agreements and the payment of all other amounts
payable hereunder.
11.5 WITHHOLDING TAXES.
(a) So long as the applicable Lender or Holder shall have
complied with the provisions of Section 11.5(c) hereof, any and all
payments under any Note, Certificate or other Operative Agreement shall
be made, in accordance with the terms hereof and thereof, free and
clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all
liabilities with respect thereto (other than taxes imposed on net
income or profits of, or any branch or franchise taxes applicable to,
the Agent, any Lender or any Holder) (y) by the jurisdiction under the
laws of which the Agent, such Lender or such Holder, as the case may
be, is organized or
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any political subdivision thereof and (z) in the case of each Lender
and Holder, by the jurisdiction in which any lending office of such
Lender or any office of such Holder from which Holder Advances are made
is located or any political subdivision thereof (all such non-excluded
taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "Non-Excluded Taxes"). If
any obligor shall be required by law to deduct any Non-Excluded Taxes
from or in respect of any sum payable under any Operative Agreement or
under any Note or Certificate to the Agent, any Lender or any Holder,
so long as the applicable Lender or Holder shall have complied with the
provisions of Section 11.5(c) hereof, (i) the sum shall be payable by
the Lessee and shall be increased as may be necessary so that after
making all required deductions (including without limitation deductions
applicable to additional sums payable under this Section), the Agent or
such Lender or such Holder, as the case may be, receives an amount
equal to the sum it would have received had no such deductions been
made, (ii) the Lessee will make such deductions and (iii) the Lessee
will pay the full amount deducted to the relevant taxation authority or
other authority in accordance with applicable law. If and to the extent
that the Agent or any Lender or any Holder subsequently shall be
refunded or otherwise recover all or any part of such deduction, it
shall refund to the Lessee the amount so recovered.
(b) So long as the applicable Lender or Holder shall have
complied with the provisions of Section 11.5(c), the Lessee will
indemnify the Agent, each Lender and each Holder for the full amount of
Non-Excluded Taxes (including without limitation any Non-Excluded Taxes
imposed by any jurisdiction on amounts payable under this Section) paid
by the Agent or such Lender or such Holder, as the case may be, and any
liability (including without limitation penalties, interest and
expenses) arising therefrom or with respect thereto. This
indemnification shall be made within thirty (30) days from the date the
Agent or any Lender or any Holder, as the case may be, makes written
demand therefor and delivers to the Lessee the original receipt of
Non-Excluded Taxes paid by it or an invoice from the relevant taxing
authority regarding such Non-Excluded Taxes. Within thirty (30) days
after the date of any payment of Non-Excluded Taxes pursuant to this
Section, the Lessee will furnish to the Agent or the relevant Lender or
the relevant Holder, as the case may be, the original or a certified
copy of a receipt or other relevant documentation evidencing payment
thereof; provided, that demand therefor must be made on the Lessee
within one hundred twenty (120) days after the Agent's or relevant
Lender's or relevant Holder's actual knowledge that such Lender or
Holder is entitled to such payment. If and to the extent that any
Lender or Holder subsequently shall be refunded or otherwise recover
all or any part of such payment of taxes, it shall refund to the Lessee
the amount so recovered.
(c) If any Lender or Holder is a "foreign corporation,
partnership or trust" within the meaning of the Code, and such Lender
or Holder is entitled to an exemption (or is exempt) from United States
withholding tax under Section 1441 or 1442 of the Code, such Lender or
Holder will deliver to the Agent and the Lessee:
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(i) if such Lender or Holder is entitled to claim
an exemption from, or a reduction of, withholding tax under a
United States tax treaty, properly completed IRS Forms 1001
and W-8 before the payment of any interest to such Lender or
Holder Yield to such Holder in the first calendar year, and
before the payment of any interest to such Lender or Holder
Yield to such Holder in each third succeeding calendar year,
during which interest may be paid to such Lender or Holder
Yield may be paid to such Holder under any Operative
Agreement;
(ii) if such Lender or Holder is entitled to claim
that interest (in the case of Lenders) or Holder Yield (in the
case of Holders) paid under the Operative Agreements is exempt
from United States withholding tax because it is effectively
connected with a United States trade or business of such
Lender or Holder, two (2) properly completed and executed
copies of IRS Form 4224 before the payment of any interest to
such Lender or Holder Yield to such Holder is due in the first
taxable year of such Lender or Holder, and in each succeeding
taxable year of such Lender or Holder, during which interest
may be paid to such Lender or Holder Yield may be paid to such
Holder under the Operative Agreements, and IRS Form W-9; and
(iii) such other form or forms as may be required
under the Code or other laws of the United States as a
condition to exemption from, or reduction of, United States
withholding tax.
Each Lender and Holder as of the Initial Closing Date, and
each assignee under any (x) Assignment and Acceptance (as of the date
thereof) or (y) assignment by any Holder of an interest under the Trust
Agreement and any Certificate, that is a "foreign corporation,
partnership or trust" as described herein must be eligible to claim a
complete exemption and must provide applicable forms to the Lessee as
required by this Section 11.5. Each such Lender and Holder will
promptly notify the Agent and the Lessee of any changes in
circumstances that would modify or render invalid any claimed exemption
or reduction.
(d) If any Lender or Holder is entitled to a reduction in the
applicable withholding tax, the Agent may withhold from any interest
payment to such Lender or any payment of Holder Yield to such Holder an
amount equivalent to the applicable withholding tax after taking into
account such reduction. If the forms or other documentation required
under subsection (c) above are not executed, completed and/or delivered
to the Agent, then the Agent may withhold from any interest payment to
such Lender or any payment of Holder Yield to such Holder, as the case
may be, not providing such forms or other documentation an amount
equivalent to the applicable withholding tax. For purposes of this
Section, a distribution hereunder by the Agent to or for the account of
any Lender or Holder shall be deemed a payment by the Lessee.
(e) If the Internal Revenue Service or any other Governmental
Authority, domestic or foreign, asserts a claim that the Agent did not
properly withhold tax from
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amounts paid to or for the account of any Lender or Holder (whether
because the appropriate form was not delivered or was not properly
executed, completed and/or delivered, because such Lender or Holder
failed to notify the Agent of a change in circumstances that rendered
the exemption from, or reduction of, withholding tax ineffective, or
for any other reason), such Lender or Holder shall indemnify the Agent
fully for all amounts paid, directly or indirectly, by the Agent as tax
or otherwise, including without limitation penalties and interest, and
including without limitation any taxes imposed by any jurisdiction on
the amounts payable to the Agent under this subsection (e), together
with all costs, expenses and reasonably attorneys' fees incurred or
paid in connection therewith.
(f) If at any time the Lessee requests any Lender or Holder to
deliver any forms other than documentation pursuant to subsection (c)
above, then the Lessee shall, upon demand of such Lender or Holder,
reimburse such Lender or Holder for any reasonable costs or expenses
incurred by such Lender or Holder in the preparation or delivery of
such forms or other documentation.
(g) Each Lender and Holder agrees that, if the Lessee is
required to pay additional amounts to or for the account of any Lender
or Holder pursuant to subsections (a) or (b) above, then such Lender or
Holder will, to the extent permitted by law, endeavor in good faith to
designate another lending office for its Eurodollar Loans (in the case
of Lenders) or office for its Eurodollar Holder Advances (in the case
of Holders), but only if such designation would make it lawful for such
Lender or Holder to continue to make or maintain Eurodollar Loans or
Eurodollar Holder Advances hereunder; provided that such designation is
made on such terms that such Lender or Holder, in its good faith
determination, suffers no increased cost or economic, legal or
regulatory disadvantage, with the object of avoiding the consequence of
the event giving rise to the operation of this Section.
11.6 REPLACEMENT OF LENDERS AND HOLDERS.
The Lessee may, at any time and so long as no Default or Event of
Default has then occurred and is continuing, replace any Lender or Holder (a)
that has requested additional amounts from the Lessee under Section 11.3 or 11.5
or (b) the obligation of which to make or maintain Eurodollar Loans or
Eurodollar Holder Advances has been suspended under Section 11.3(f) by written
notice to the Agent and such Lender or such Holder, as the case may be, given
not more than thirty (30) days after any such event. Within sixty (60) days of
such notice, the Lessee shall give written notice to the Agent and such Lender
or such Holder, as the case may be, identifying one or more Persons each of
which qualifies as an Eligible Assignee and shall be reasonably acceptable to
the Agent (each, a "Replacement Financing Party," and collectively, the
"Replacement Financing Parties") to replace such Lender or Holder (the "Replaced
Financing Party"), provided that (i) the second notice from the Lessee to the
Replaced Financing Party and the Agent provided for hereinabove shall specify an
effective date for such replacement (the "Replacement Effective Date"), which
shall be at least five (5) Business Days after such notice is given, (ii) as of
the relevant Replacement Effective Date, each Replacement Financing Party
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shall enter into an Assignment and Acceptance with the Replaced Financing Party
(if such Replaced Financing Party is a Lender) (but shall not be required to pay
the processing fee otherwise payable to the Agent with regard thereto) or shall
enter into an assignment and acceptance with the Replaced Financing Party, in
form and substance satisfactory to the signatories (if such Replaced Financing
Party is a Holder), pursuant to which such Replacement Financing Parties
collectively shall acquire, in such proportion among them as they may agree with
the Lessee and the Agent, all (but not less than all) of the Commitments, Holder
Commitments, outstanding Loans and outstanding Holder Advances of the Replaced
Financing Party, and, in connection therewith, shall pay to the Replaced
Financing Party, as the purchase price in respect thereof, an amount equal to
the sum as of the Replacement Effective Date (without duplication) of (x) the
unpaid principal amount of and all accrued but unpaid interest on all
outstanding Loans of the Replaced Financing Party, (y) the unpaid amount of
Holder Advances and all accrued but unpaid Holder Yield on Holder Advances of
the Replaced Financing Party and (z) the Replaced Financing Party's ratable
share of all accrued but unpaid fees owing to the Replaced Financing Party
hereunder and (iii) all other obligations of the Lessee owing to the Replaced
Financing Party (other than those specifically described in clause (ii) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid), including without limitation amounts payable under Section 11.4 as
a result of the actions required to be taken under this Section, shall be paid
in full by the Lessee to the Replaced Financing Party on or prior to the
Replacement Effective Date.
11.7 EXPRESS INDEMNIFICATION FOR ORDINARY NEGLIGENCE, STRICT
LIABILITY, ETC.
WITHOUT LIMITING THE GENERALITY OF THE INDEMNIFICATION PROVISIONS OF
ANY AND ALL OF THE OPERATIVE AGREEMENTS, EACH PERSON PROVIDING INDEMNIFICATION
OF ANOTHER PERSON UNDER ANY OPERATIVE AGREEMENT HEREBY FURTHER EXPRESSLY
RELEASES EACH BENEFICIARY OF ANY SUCH INDEMNIFICATION FROM ALL CLAIMS FOR LOSS
OR DAMAGE, DESCRIBED IN ANY OPERATIVE AGREEMENT, CAUSED BY ANY ACT OR OMISSION
ON THE PART OF ANY SUCH BENEFICIARY ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE
(WHETHER SOLE OR CONTRIBUTORY) OR STRICT LIABILITY OF ANY SUCH BENEFICIARY, AND
INDEMNIFIES, EXONERATES AND HOLDS EACH SUCH BENEFICIARY FREE AND HARMLESS FROM
AND AGAINST ANY AND ALL ACTIONS, CAUSES OF ACTION, SUITS, CLAIMS, LOSSES, COSTS,
LIABILITIES, DAMAGES AND EXPENSES (INCLUDING WITHOUT LIMITATION ATTORNEY'S FEES
AND EXPENSES), DESCRIBED ABOVE, INCURRED BY ANY SUCH BENEFICIARY (IRRESPECTIVE
OF WHETHER ANY SUCH BENEFICIARY IS A PARTY TO THE ACTION FOR WHICH
INDEMNIFICATION UNDER THIS AGREEMENT OR ANY OTHER OPERATIVE AGREEMENT IS SOUGHT)
ATTRIBUTABLE TO THE ORDINARY NEGLIGENCE (WHETHER SOLE OR CONTRIBUTORY) OR STRICT
LIABILITY OF ANY SUCH BENEFICIARY.
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SECTION 12. MISCELLANEOUS.
12.1. SURVIVAL OF AGREEMENTS.
The representations, warranties, covenants, indemnities and agreements
of the parties provided for in the Operative Agreements, and the parties'
obligations under any and all thereof, shall survive the execution and delivery
of this Agreement, the transfer of any Property to the Owner Trustee, the
acquisition of any Property (or any of its components), the construction of any
Improvements, the Completion of any Property, any disposition of any interest of
the Owner Trustee in any Property or any interest of the Holders in the Trust
Estate, the payment of the Notes and any disposition thereof and shall be and
continue in effect notwithstanding any investigation made by any party and the
fact that any party may waive compliance with any of the other terms, provisions
or conditions of any of the Operative Agreements. Except as otherwise expressly
set forth herein or in other Operative Agreements, the indemnities of the
parties provided for in the Operative Agreements shall survive the expiration or
termination of any thereof.
12.2. NO BROKER, ETC.
Each of the parties hereto represents to the others that it has not
retained or employed any broker, finder or financial adviser to act on its
behalf in connection with this Agreement, nor has it authorized any broker,
finder or financial adviser retained or employed by any other Person so to act.
Any party who is in breach of this representation shall indemnify and hold the
other parties harmless from and against any liability arising out of such breach
of this representation.
12.3. NOTICES.
All notices required or permitted to be given under any Operative
Agreement shall be in writing. Notices may be served by certified or registered
mail, postage paid with return receipt requested; by private courier, prepaid;
by telex, facsimile, or other telecommunication device capable of transmitting
or creating a written record; or personally. Mailed notices shall be deemed
delivered five (5) days after mailing, properly addressed. Couriered notices
shall be deemed delivered when delivered as addressed, or if the addressee
refuses delivery, when presented for delivery notwithstanding such refusal.
Telex or telecommunicated notices shall be deemed delivered when receipt is
either confirmed by confirming transmission equipment or acknowledged by the
addressee or its office. Personal delivery shall be effective when accomplished.
Unless a party changes its address by giving notice to the other party as
provided herein, notices shall be delivered to the parties at the following
addresses:
If to the Construction Agent or the Lessee, to such entity at the
following addresses:
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Province Healthcare Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Vice President - Finance
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ PLLC
Nashville City Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Guarantor, to such entity in care of the Lessee at the
above-referenced address.
If to the Owner Trustee, to it at the following address:
First Security Bank, National Association
▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇. ▇▇▇▇▇
Vice President
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Holders, to each such Holder at the address set forth for
such Holder on Schedule I of the Trust Agreement.
If to the Agent, to it at the following address:
First Union National Bank
c/o First Union Capital Markets Group
DC-6
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇
Capital Markets Services
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy (which shall not constitute notice) to:
First Union National Bank
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall not constitute notice) to:
First Union National Bank
One First Union Center, 5th Floor
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Lender, to it at the address set forth for such Lender in
Schedule 1.1 of the Credit Agreement.
From time to time any party may designate additional parties and/or
another address for notice purposes by notice to each of the other parties
hereto. Each notice hereunder shall be effective upon receipt or refusal
thereof.
12.4. COUNTERPARTS.
This Agreement may be executed by the parties hereto in separate
counterparts, each of which when so executed and delivered shall be an original,
but all such counterparts shall together constitute but one (1) and the same
instrument.
12.5. TERMINATIONS, AMENDMENTS, WAIVERS, ETC.; UNANIMOUS VOTE
MATTERS.
Each Operative Agreement may be terminated, amended, supplemented,
waived or modified only by an instrument in writing signed by, subject to
Article VIII of the Trust Agreement regarding termination of the Trust
Agreement, the Majority Secured Parties and each Credit Party (to the extent
such Credit Party is a party to such Operative Agreement). In addition, (a) the
Unanimous Vote Matters shall require the consent of each Lender and each Holder
and (b) any provision of any Operative Agreement incorporated by reference or
otherwise referenced in a second Operative Agreement shall remain, respecting
such second Operative Agreement, in its original form without regard to any such
termination, amendment, supplement, waiver or modification in the first
Operative Agreement except if such has been agreed to by an instrument in
writing signed by, subject to Article VIII of the Trust Agreement regarding
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termination of the Trust Agreement, the Majority Secured Parties and each Credit
Party (to the extent such Credit Party is a party to such Operative Agreement).
Notwithstanding the foregoing, no such termination, amendment,
supplement, waiver or modification shall, without the consent of the Agent and,
to the extent affected thereby, each Lender and each Holder (collectively, the
"Unanimous Vote Matters") (i) reduce the amount of any Note or any Certificate,
extend the scheduled date of maturity of any Note, extend the scheduled
Expiration Date, extend any payment date of any Note or Certificate, reduce the
stated rate of interest payable on any Note, reduce the stated Holder Yield
payable on any Certificate (other than as a result of waiving the applicability
of any post-default increase in interest rates or Holder Yields), modify the
priority of any Lien in favor of the Agent under any Security Document,
subordinate any obligation owed to any Lender or Holder, reduce any Lender
Facility Fees or any Holder Facility Fees payable under the Participation
Agreement, extend the scheduled date of payment of any Lender Facility Fees or
any Holder Facility Fees or increase the amount or extend the expiration date of
any Lender's Commitment or the Holder Commitment of any Holder, or (ii)
terminate, amend, supplement, waive or modify any provision of this Section 12.5
or reduce the percentages specified in the definitions of Majority Lenders,
Majority Holders or Majority Secured Parties, or consent to the assignment or
transfer by the Owner Trustee of any of its rights and obligations under any
Credit Document or release a material portion of the Collateral (except in
accordance with Section 8.8) or release any Credit Party from its obligations
under any Operative Agreement or otherwise alter any payment obligations of any
Credit Party to the Lessor or any Financing Party under the Operative
Agreements, or (iii) terminate, amend, supplement, waive or modify any provision
of Section 7 of the Credit Agreement, or (iv) permit Advances for Work in excess
of the Construction Budget, or (v) eliminate the automatic option under Section
5.3(b) of the Agency Agreement requiring that the Construction Agent pay certain
liquidated damages in exchange for the conveyance of a Property to the
Construction Agent. Any such termination, amendment, supplement, waiver or
modification shall apply equally to each of the Lenders and the Holders and
shall be binding upon all the parties to this Agreement. In the case of any
waiver, each party to this Agreement shall be restored to its former position
and rights under the Operative Agreements, and any Default or Event of Default
waived shall be deemed to be cured and not continuing; but no such waiver shall
extend to any subsequent or other Default or Event of Default, or impair any
right consequent thereon.
If at a time when the conditions precedent set forth in the Operative
Agreements to any Loan are, in the opinion of the Majority Lenders, satisfied,
any Lender shall fail to fulfill its obligations to make such Loan (any such
Lender, a "Defaulting Lender") then, for so long as such failure shall continue,
the Defaulting Lender shall (unless the Lessee and the Majority Lenders,
determined as if the Defaulting Lender were not a "Lender", shall otherwise
consent in writing) be deemed for all purposes relating to terminations,
amendments, supplements, waivers or modifications under the Operative Agreements
to have no Loans, shall not be treated as a "Lender" when performing the
computation of Majority Lenders or Majority Secured Parties, and shall have no
rights under this Section 12.5; provided that any action taken pursuant to the
second paragraph of this Section 12.5 shall not be effective as against the
Defaulting Lender.
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If at a time when the conditions precedent set forth in the Operative
Agreements to any Holder Advance are, in the opinion of the Majority Holders,
satisfied, any Holder shall fail to fulfill its obligations to make such Holder
Advance (any such Holder, a "Defaulting Holder") then, for so long as such
failure shall continue, the Defaulting Holder shall (unless the Lessee and the
Majority Holders, determined as if the Defaulting Holder were not a "Holder",
shall otherwise consent in writing) be deemed for all purposes relating to
terminations, amendments, supplements, waivers or modifications under the
Operative Agreements to have no Holder Advances, shall not be treated as a
"Holder" when performing the computation of Majority Holders or Majority Secured
Parties, and shall have no rights under this Section 12.5; provided that any
action taken pursuant to the second paragraph of this Section 12.5 shall not be
effective as against the Defaulting Holder.
12.6. HEADINGS, ETC.
The Table of Contents and headings of the various Articles and Sections
of this Agreement are for convenience of reference only and shall not modify,
define, expand or limit any of the terms or provisions hereof.
12.7. PARTIES IN INTEREST.
Except as expressly provided herein, none of the provisions of this
Agreement are intended for the benefit of any Person except the parties hereto.
12.8. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF JURY
TRIAL; VENUE; ARBITRATION.
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED, INTERPRETED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA.
Any legal action or proceeding with respect to this Agreement or any
other Operative Agreement may be brought in the courts of the State of
North Carolina in Mecklenburg County or of the United States for the
Western District of North Carolina and, by execution and delivery of
this Agreement, each of the parties to this Agreement hereby
irrevocably accepts for itself and in respect of its property,
generally and unconditionally, the nonexclusive jurisdiction of such
courts. Each of the parties to this Agreement further irrevocably
consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies
thereof by registered or certified mail, postage prepaid, to it at the
address set out for notices pursuant to Section 12.3, such service to
become effective three (3) days after such mailing. Nothing herein
shall affect the right of any party to serve process in any other
manner permitted by Law or to commence legal proceedings or to
otherwise proceed against any party in any other jurisdiction.
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(b) EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY, TO THE FULLEST EXTENT ALLOWED BY APPLICABLE LAW,
WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT, ANY OTHER OPERATIVE AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.
(c) Each of the parties to this Agreement hereby irrevocably
waives any objection which it may now or hereafter have to the laying
of venue of any of the aforesaid actions or proceedings arising out of
or in connection with this Agreement or any other Operative Agreement
brought in the courts referred to in subsection (a) above and hereby
further irrevocably waives and agrees not to plead or claim in any such
court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum.
(d) Notwithstanding the provisions of Section 12.8(a) or of
any other Operative Agreement to the contrary, upon demand of any party
to this Agreement and/or any other Operative Agreement, whether made
before or within three (3) months after institution of any judicial
proceeding, any dispute, claim or controversy arising out of, connected
with or relating to this Agreement and/or any other Operative Agreement
between or among parties to this Agreement and/or any other Operative
Agreement ("Disputes") shall be resolved by binding arbitration as
provided herein. Institution of a judicial proceeding by a party does
not waive the right of that party to demand arbitration hereunder.
Disputes may include without limitation tort claims, counterclaims,
disputes as to whether a matter is subject to arbitration, claims
brought as class actions, claims arising from agreements executed in
the future, or claims arising out of or connected with the transaction
reflected by this Agreement and/or any other Operative Agreement.
Arbitration shall be conducted under and governed by the
Commercial Financial Disputes Arbitration Rules (the "Arbitration
Rules") of the American Arbitration Association (the "AAA") and Title 9
of the United States Code. All arbitration hearings shall be conducted
in Charlotte, North Carolina. A hearing shall begin within ninety (90)
days of demand for arbitration and all hearings shall be concluded
within one hundred twenty (120) days of demand for arbitration. These
time limitations may not be extended unless a party shows cause for
extension and then no more than a total extension of sixty (60) days.
The expedited procedures set forth in Rule 51 et seq. of the
Arbitration Rules shall be applicable to claims of less than
$1,000,000. All applicable statutes of limitation shall apply to any
Dispute. A judgment upon the award may be entered in any court having
jurisdiction. The panel from which all arbitrators are selected shall
be comprised of licensed attorneys selected from the Commercial
Financial Disputes Arbitration Panel of the AAA. The single arbitrator
selected for expedited procedure shall be a retired judge from the
highest court of general jurisdiction, state or federal, of the state
where the hearing will be conducted or if such person is not available
to serve, the single arbitrator may be a licensed attorney.
Notwithstanding the foregoing, this arbitration provision does not
apply to disputes under or related to swap agreements.
Notwithstanding the immediately preceding binding arbitration
provisions, the parties to this Agreement and/or any other Operative
Agreement agree to preserve,
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without diminution, certain remedies that the Agent on behalf of the
Lenders and the Holders may employ or exercise freely, independently or
in connection with an arbitration proceeding or after an arbitration
action is brought. The Agent on behalf of the Lenders and the Holders
shall have the right to proceed in any court of proper jurisdiction or
by self-help to exercise or prosecute the following remedies, as
applicable (i) all rights to foreclose against any real or personal
property or other security by exercising a power of sale granted under
any Operative Agreement or under applicable Law or by judicial
foreclosure and sale, including without limitation a proceeding to
confirm the sale; (ii) all rights of self-help including without
limitation peaceful occupation of real property and collection of
rents, set-off and peaceful possession of personal property; (iii)
obtaining provisional or ancillary remedies including without
limitation injunctive relief, sequestration, garnishment, attachment,
appointment of receiver and filing an involuntary bankruptcy
proceeding; and (iv) when applicable, a judgment by confession of
judgment. Preservation of these remedies does not limit the power of an
arbitrator to grant similar remedies that may be requested by a party
in a Dispute.
The parties to this Agreement and/or any other Operative
Agreement agree that they shall not have a remedy of special, punitive
or exemplary damages against any other party in any Dispute and hereby
waive any right or claim to special, punitive or exemplary damages they
have now or which may arise in the future in connection with any
Dispute whether the Dispute is resolved by arbitration or judicially.
By execution and delivery of this Agreement and/or any other
Operative Agreement, each of the parties hereto and/or thereto accepts,
for itself and in connection with its properties, generally and
unconditionally, the non-exclusive jurisdiction relating to any
arbitration proceedings conducted under the Arbitration Rules in
Charlotte, North Carolina and irrevocably agrees to be bound by any
final judgment rendered thereby in connection with this Agreement
and/or any other Operative Agreement from which no appeal has been
taken or is available.
12.9. SEVERABILITY.
Any provision of this Agreement that 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 hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
12.10. LIABILITY LIMITED.
(a) The Lenders, the Agent, the Credit Parties, the Owner
Trustee and the Holders each acknowledge and agree that the Owner
Trustee is (except as otherwise expressly provided herein or therein)
entering into this Agreement and the other Operative Agreements to
which it is a party (other than the Trust Agreement and to the
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extent otherwise provided in Section 6.2 of this Agreement), solely in
its capacity as trustee under the Trust Agreement and not in its
individual capacity and that the Trust Company shall not be liable or
accountable under any circumstances whatsoever in its individual
capacity for or on account of any statements, representations,
warranties, covenants or obligations stated to be those of the Owner
Trustee, except for its own gross negligence or willful misconduct and
as otherwise expressly provided herein or in the other Operative
Agreements.
(b) Anything to the contrary contained in this Agreement, the
Credit Agreement, the Notes or in any other Operative Agreement
notwithstanding, no Exculpated Person shall be personally liable in any
respect for any liability or obligation arising hereunder or in any
other Operative Agreement including without limitation the payment of
the principal of, or interest on, the Notes, or for monetary damages
for the breach of performance of any of the covenants contained in the
Credit Agreement, the Notes, this Agreement, the Security Agreement or
any of the other Operative Agreements. The Lenders, the Holders and the
Agent agree that, in the event any remedies under any Operative
Agreement are pursued, neither the Lenders, the Holders nor the Agent
shall have any recourse against any Exculpated Person, for any
deficiency, loss or Claim for monetary damages or otherwise resulting
therefrom and recourse shall be had solely and exclusively against the
Trust Estate (excluding Excepted Payments) and the Credit Parties (with
respect to the Credit Parties' obligations under the Operative
Agreements); but nothing contained herein shall be taken to prevent
recourse against or the enforcement of remedies against the Trust
Estate (excluding Excepted Payments) in respect of any and all
liabilities, obligations and undertakings contained herein and/or in
any other Operative Agreement. Notwithstanding the provisions of this
Section, nothing in any Operative Agreement shall: (i) constitute a
waiver, release or discharge of any indebtedness or obligation
evidenced by the Notes and/or the Certificates arising under any
Operative Agreement or secured by any Operative Agreement, but the same
shall continue until paid or discharged; (ii) relieve any Exculpated
Person from liability and responsibility for (but only to the extent of
the damages arising by reason of): active waste knowingly committed by
any Exculpated Person with respect to any Property, any fraud, gross
negligence or willful misconduct on the part of any Exculpated Person;
(iii) relieve any Exculpated Person from liability and responsibility
for (but only to the extent of the moneys misappropriated, misapplied
or not turned over) (A) except for Excepted Payments, misappropriation
or misapplication by the Lessor (i.e., application in a manner contrary
to any of the Operative Agreements) of any insurance proceeds or
condemnation award paid or delivered to the Lessor by any Person other
than the Agent, (B) except for Excepted Payments, any deposits or any
escrows or amounts owed by the Construction Agent under the Agency
Agreement held by the Lessor or (C) except for Excepted Payments, any
rent or other income received by the Lessor from any Credit Party that
is not turned over to the Agent; or (iv) affect or in any way limit the
Agent's rights and remedies under any Operative Agreement with respect
to the Rents and rights and powers of the Agent under the Operative
Agreements or to obtain a judgment against the Lessee's interest in the
Properties or the Agent's rights and powers to obtain a judgment
against the Lessor or any Credit Party (provided, that no deficiency
judgment or other
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money judgment shall be enforced against any Exculpated Person except
to the extent of the Lessor's interest in the Trust Estate (excluding
Excepted Payments) or to the extent the Lessor may be liable as
otherwise contemplated in clauses (ii) and (iii) of this Section
12.10(b)).
12.11. RIGHTS OF THE CREDIT PARTIES.
If at any time all obligations (i) of the Owner Trustee under the
Credit Agreement, the Security Documents and the other Operative Agreements and
(ii) of the Credit Parties under the Operative Agreements have in each case been
satisfied or discharged in full, then the Credit Parties shall be entitled to
(a) terminate the Lease and the guaranty obligations under Section 6B and (b)
receive all amounts then held under the Operative Agreements and all proceeds
with respect to any of the Properties. Upon the termination of the Lease and
Section 6B pursuant to the foregoing clause (a), the Lessor shall transfer to
the Lessee (or its designee) all of its right, title and interest free and clear
of the Lien of the Lease, the Lien of the Security Documents and all Lessor
Liens in and to any Properties then subject to the Lease and any amounts or
proceeds referred to in the foregoing clause (b) shall be paid over to the
Lessee.
12.12. FURTHER ASSURANCES.
The parties hereto shall promptly cause to be taken, executed,
acknowledged or delivered, at the sole expense of the Lessee, all such further
acts, conveyances, documents and assurances as the other parties may from time
to time reasonably request in order to carry out and effectuate the intent and
purposes of this Participation Agreement, the other Operative Agreements and the
transactions contemplated hereby and thereby (including without limitation the
preparation, execution and filing of any and all Uniform Commercial Code
financing statements, filings of Mortgage Instruments and other filings or
registrations which the parties hereto may from time to time request to be filed
or effected). The Lessee, at its own expense and without need of any prior
request from any other party, shall take such action as may be necessary
(including without limitation any action specified in the preceding sentence),
or (if the Owner Trustee shall so request) as so requested, in order to maintain
and protect all security interests provided for hereunder or under any other
Operative Agreement.
12.13. CALCULATIONS UNDER OPERATIVE AGREEMENTS.
The parties hereto agree that all calculations and numerical
determinations to be made under the Operative Agreements by the Owner Trustee
shall be made by the Agent and that such calculations and determinations shall
be conclusive and binding on the parties hereto in the absence of manifest
error.
12.14. CONFIDENTIALITY.
Each Financing Party severally agrees to use reasonable efforts to keep
confidential all non-public information pertaining to any Credit Party or any of
its Subsidiaries which is provided to it by any Credit Party or any of its
Subsidiaries and which an officer of any Credit
62
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Party or any of its Subsidiaries has requested in writing be kept confidential,
and shall not intentionally disclose such information to any Person except:
(a) to the extent such information is public when received by
such Person or becomes public thereafter due to the act or omission of
any party other than such Person;
(b) to the extent such information is independently obtained
from a source other than any Credit Party or any of its Subsidiaries
and such information from such source is not, to such Person's
knowledge, subject to an obligation of confidentiality or, if such
information is subject to an obligation of confidentiality, that
disclosure of such information is permitted;
(c) to counsel, auditors or accountants retained by any such
Person or any Affiliates of any such Person (if such Affiliates are
permitted to receive such information pursuant to clause (f) or (g)
below), provided they agree to keep such information confidential as if
such Person or Affiliate were party to this Agreement and to financial
institution regulators, including examiners of any Financing Party or
any Affiliate thereof in the course of examinations of such Persons;
(d) in connection with any litigation or the enforcement or
preservation of the rights of any Financing Party under the Operative
Agreements;
(e) to the extent required by any applicable statute, rule or
regulation or court order (including without limitation, by way of
subpoena) or pursuant to the request of any regulatory or Governmental
Authority having jurisdiction over any such Person; provided, however,
that such Person shall endeavor (if not otherwise prohibited by Law) to
notify the Lessee prior to any disclosure made pursuant to this clause
(e), except that no such Person shall be subject to any liability
whatsoever for any failure to so notify the Lessee;
(f) any Financing Party may disclose such information to
another Financing Party or to any Affiliate of a Financing Party that
is a direct or indirect owner of any Financing Party;
(g) any Financing Party may disclose such information to an
Affiliate of any Financing Party to the extent required in connection
with the transactions contemplated hereby or to the extent such
Affiliate is involved in, or provides advice or assistance to such
Person with respect to, such transactions (provided, in each case that
such Affiliate has agreed in writing to maintain confidentiality as if
it were such Financing Party (as the case may be)); or
(h) to the extent disclosure to any other financial
institution or other Person is appropriate in connection with any
proposed or actual (i) assignment or grant of a participation by any of
the Lenders of interests in the Credit Agreement or any Note to such
other financial institution (who will in turn be required by the Agent
to agree in
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writing to maintain confidentiality as if it were a Lender originally
party to this Agreement) or (ii) assignment by any Holder of interests
in the Trust Agreement to another Person (who will in turn be required
by the transferring Holder to agree in writing to maintain
confidentiality as if it were a Holder originally party to this
Agreement).
Subject to the terms of Sections 12.14(a), (b), (d) and (e) under the
terms of any one or more of which circumstances disclosure shall be permitted,
each Financing Party severally agrees to use reasonable efforts to keep
confidential all non-public information pertaining to the financing structure
described in the unrecorded Operative Agreements.
12.15. FINANCIAL REPORTING/TAX CHARACTERIZATION.
Lessee agrees to obtain advice from its own accountants and tax counsel
regarding the financial reporting treatment and the tax characterization of the
transactions described in the Operative Agreements. Lessee further agrees that
Lessee shall not rely upon any statement of any Financing Party or any of their
respective Affiliates and/or Subsidiaries regarding any such financial reporting
treatment and/or tax characterization.
12.16. SET-OFF.
In addition to any rights now or hereafter granted under applicable Law
and not by way of limitation of any such rights, upon and after the occurrence
of any Event of Default and during the continuance thereof, the Lenders, the
Holders, their respective Affiliates and any assignee or participant of a Lender
or a Holder in accordance with the applicable provisions of the Operative
Agreements are hereby authorized by the Credit Parties at any time or from time
to time, without notice to the Credit Parties or to any other Person, any such
notice being hereby expressly waived, to set-off and to appropriate and to apply
any and all deposits (general or special, time or demand, including without
limitation indebtedness evidenced by certificates of deposit, whether matured or
unmatured) and any other indebtedness at any time held or owing by the Lenders,
the Holders, their respective Affiliates or any assignee or participant of a
Lender or a Holder in accordance with the applicable provisions of the Operative
Agreements to or for the credit or the account of any Credit Party against and
on account of the obligations of any Credit Party under the Operative Agreements
irrespective of whether or not (a) the Lenders or the Holders shall have made
any demand under any Operative Agreement or (b) the Agent shall have declared
any or all of the obligations of any Credit Party under the Operative Agreements
to be due and payable and although such obligations shall be contingent or
unmatured. NOTWITHSTANDING THE FOREGOING, NEITHER THE AGENT NOR ANY OTHER
FINANCING PARTY SHALL EXERCISE, OR ATTEMPT TO EXERCISE, ANY RIGHT OF SETOFF,
BANKER'S LIEN, OR THE LIKE, AGAINST ANY DEPOSIT ACCOUNT OR PROPERTY OF ANY
CREDIT PARTY HELD BY THE AGENT OR ANY OTHER FINANCING PARTY, WITHOUT THE PRIOR
WRITTEN CONSENT OF THE MAJORITY SECURED PARTIES, AND ANY FINANCING PARTY
VIOLATING THIS PROVISION SHALL INDEMNIFY THE AGENT AND THE OTHER FINANCING
PARTIES FROM ANY AND ALL COSTS, EXPENSES, LIABILITIES AND DAMAGES RESULTING
THEREFROM. The contractual restriction on the exercise of setoff rights provided
in the
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foregoing sentence is solely for the benefit of the Agent and the
Financing Parties and may not be enforced by any Credit Party.
[signature pages follow]
65
70
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
day and year first above written.
PROVINCE HEALTHCARE COMPANY, as the
Construction Agent and as the Lessee
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Title: Vice President - Finance
------------------------------------
BLYTHE-PROVINCE, INC.,
a Tennessee corporation, as a Guarantor
BRIM EQUIPMENT SERVICES, INC.,
an Oregon corporation, as a Guarantor
BRIM FIFTH AVENUE, INC.,
an Oregon corporation, as a Guarantor
BRIM HEALTHCARE, INC.,
an Oregon corporation, as a Guarantor
BRIM HOSPITALS, INC.,
an Oregon corporation, as a Guarantor
BRIM OUTPATIENT SERVICES, INC.
an Oregon corporation, as a Guarantor
BRIM PAVILION, INC.,
an Oregon corporation, as a Guarantor
BRIM SERVICES GROUP, INC.,
an Oregon corporation, as a Guarantor
CARE HEALTH COMPANY, INC.,
a Washington corporation, as a Guarantor
MEXIA-PRINCIPAL, INC.,
a Texas corporation, as a Guarantor
PALESTINE-PRINCIPAL G.P., INC.,
a Texas corporation, as a Guarantor
PALESTINE-PRINCIPAL, INC.,
a Tennessee corporation, as a Guarantor
PHC-▇▇▇▇▇▇, INC.,
a Louisiana corporation, as a Guarantor
PHC-LAKE HAVASU, INC.,
an Arizona corporation, as a Guarantor
[Signature pages continued]
71
PHC OF DELAWARE, INC.,
a Delaware corporation, as a Guarantor
PRINCIPAL HOSPITAL COMPANY OF NEVADA, INC.,
a Nevada corporation, as a Guarantor
PRINCIPAL ▇▇▇▇ COMPANY,
a Delaware corporation, as a Guarantor
PRINCIPAL-NEEDLES, INC.,
a Tennessee corporation, as a Guarantor
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Assistant Treasurer of each of the
foregoing Guarantors
MEXIA PRINCIPAL HEALTHCARE LIMITED
PARTNERSHIP, a Texas limited partnership, as
a Guarantor
By: Mexia-Principal, Inc., a Texas
corporation, its General Partner
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Assistant Treasurer
-------------------------------------
PALESTINE PRINCIPAL HEALTHCARE LIMITED
PARTNERSHIP, a Texas limited partnership, as
a Guarantor
By: Palestine-Principal G.P., Inc., a
Texas corporation, its General
Partner
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Assistant Treasurer
-------------------------------------
[Signature pages continued]
72
INTEGRATED HEALTH MANAGEMENT, LLC, a
California limited liability company, as a
Guarantor
By: Brim Healthcare, Inc., as Member
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Assistant Treasurer
-------------------------------------
[Signature pages continued]
73
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly stated
herein, but solely as the Owner Trustee
under the PHC Real Estate Trust 1998-1, as
the Owner Trustee and as the Lessor
By: /s/ C. ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: C. ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
74
FIRST UNION NATIONAL BANK, as a Holder, as a
Lender and as the Agent
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Senior Vice President
-------------------------------------
[Signature pages continued]
75
NATIONSBANK OF TENNESSEE, N.A., as a Holder
and as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------------
Title: Senior Vice President
-------------------------------------
[Signature pages continued]
76
KEY CORPORATE CAPITAL, INC., as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------------
Title: AVP
-------------------------------------
[Signature pages continued]
77
CORESTATES BANK, N.A., as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
78
BANQUE PARIBAS, as a Holder and as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇
---------------------------------------
Title: AVP
-------------------------------------
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
79
MELLON BANK, N.A., as a Lender
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
80
NATIONAL CITY BANK OF KENTUCKY, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
81
AMSOUTH BANK, as a Lender
By: /s/ ▇▇▇▇▇ ▇. WIND
----------------------------------------
Name: ▇▇▇▇▇ ▇. Wind
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
82
FIRST AMERICAN NATIONAL BANK, as a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Title: Senior Vice President
-------------------------------------
[Signature pages continued]
83
FLEET NATIONAL BANK, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
84
▇▇▇▇▇▇ COMMERCIAL PAPER INC., as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------------
Title: Authorized Signatory
-------------------------------------
[Signature pages continued]
85
CREDIT LYONNAIS NEW YORK BRANCH, as a Lender
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
[Signature pages continued]
▇▇
▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, N.A., as a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------------
Title: Vice President
-------------------------------------
87
EXHIBIT A
REQUISITION FORM
(Pursuant to Sections 4.2, 5.2, 5.3 and 5.4 of the Participation Agreement)
Province Healthcare Company, a Delaware corporation (the "Company")
hereby certifies as true and correct and delivers the following Requisition to
First Union National Bank, as the agent for the Lenders (hereinafter defined)
and respecting the Security Documents, as the agent for the Lenders and the
Holders (hereinafter defined), to the extent of their interests (the "Agent"):
Reference is made herein to that certain Participation Agreement dated
as of March 30, 1998 (as amended, modified, extended, supplemented, restated
and/or replaced from time to time, the "Participation Agreement") among the
Company, in its capacity as the Lessee and as the Construction Agent, First
Security Bank, National Association, as the Owner Trustee, the various banks and
other lending institutions which are parties thereto from time to time, as
holders (the "Holders"), the various banks and other lending institutions which
are parties thereto from time to time, as lenders (the "Lenders"), and the
Agent. Capitalized terms used herein but not otherwise defined herein shall have
the meanings set forth therefor in the Participation Agreement.
Check one:
____ INITIAL CLOSING DATE: _________________
(three (3) Business Days prior notice required for Advance)
____ PROPERTY CLOSING DATE:_________________
(three (3) Business Days prior notice required for Advance)
____ CONSTRUCTION ADVANCE DATE:_____________
(three (3) Business Days prior notice required for Advance)
1. Transaction Expenses and other fees, expenses and disbursements under
Sections 7.1(a) or 7.1(b) of the Participation Agreement and any and
all other amounts contemplated to be financed under the Participation
Agreement including without limitation any Work, broker's fees, taxes,
recording fees and the like (with supporting invoices or closing
statement attached):
A-1
88
Party to Whom Amount Owed
Amount is Owed (in U.S. Dollars)
-------------- --------------
-------------- --------------
-------------- --------------
2. Description of Land (which shall be a legal description of the Land in
connection with an Advance to pay Property Acquisition Costs): See
attached Schedule 1
3. Description of Improvements: See attached Schedule 2
4. Description of Equipment: See attached Schedule 3
5. Description of Work: See attached Schedule 4
6. Aggregate Loans and Holder Advances requested since the Initial Closing
Date with respect to each Property for which Advances are requested
under this Requisition (listed on a Property by Property basis),
including without limitation all amounts requested under this
Requisition: [IDENTIFY ON A PROPERTY BY PROPERTY BASIS]
$______________ [Property]
In connection with this Requisition, the Company hereby requests that
the Lenders make Loans to the Lessor in the amount of $______________ and that
the Holders make Holder Advances to the Lessor in the amount of
$________________. The Company hereby certifies (i) that the foregoing amounts
requested do not exceed the total aggregate of the Available Commitments plus
the Available Holder Commitments and (ii) each of the provisions of the
Participation Agreement applicable to the Loans and Holder Advances requested
hereunder have been complied with as of the date of this Requisition.
The Company has caused this Requisition to the executed by its duly
authorized officer as of this _____ day of __________, ______.
PROVINCE HEALTHCARE COMPANY
By:
----------------------------------------
Name:
--------------------------------------
Title:
------------------------------------
A-2
89
Schedule 1
Description of Land
(Legal Description and Street Address)
A-3
90
Schedule 2
Description of Improvements
A-4
91
Schedule 3
Description of Equipment
======================================= ====================== ======================== ==========================
General Description Make Model Serial Number
--------------------------------------- ---------------------- ------------------------ --------------------------
--------------------------------------- ---------------------- ------------------------ --------------------------
--------------------------------------- ---------------------- ------------------------ --------------------------
--------------------------------------- ---------------------- ------------------------ --------------------------
--------------------------------------- ---------------------- ------------------------ --------------------------
--------------------------------------- ---------------------- ------------------------ --------------------------
--------------------------------------- ---------------------- ------------------------ --------------------------
A-5
92
Schedule 4
Work
Work Performed for which the Advance is requested:
----------------------------------------------------------
----------------------------------------------------------
----------------------------------------------------------
A-6
93
EXHIBIT B
[Outside Counsel Opinion for the Lessee]
(Pursuant to Section 5.3(j) of the
Participation Agreement)
____________, ______
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Synthetic Lease Financing Provided in favor of Province Healthcare
Company
Dear Sirs:
We have acted as special counsel to Province Healthcare Company, a Delaware
corporation (the "Lessee"), and the various parties to the Participation
Agreement (hereinafter defined) from time to time, as guarantors (individually,
a "Guarantor" and collectively, the "Guarantors"; individually, Lessee and each
Guarantor may be referred to herein as a "Credit Party" or collectively, as the
"Credit Parties") in connection with certain transactions contemplated by the
Participation Agreement dated as of March 30, 1998 (the "Participation
Agreement"), among the Lessee, First Security Bank, National Association, as the
Owner Trustee (the "Owner Trustee"), First Union National Bank, as a holder
(together with the other holders, the "Holders"), First Union National Bank, as
a lender (together with the other lenders, the "Lenders") and First Union
National Bank, as the agent for the Lenders and respecting the Security
Documents, as the agent for the Lenders and the Holders, to the extent of their
interests (the "Agent"). This opinion is delivered pursuant to Section 5.3(j) of
the Participation Agreement. All capitalized terms used herein, and not
otherwise defined herein, shall have the meanings assigned thereto in Appendix A
to the Participation Agreement.
In connection with the foregoing, we have examined originals, or copies
certified to our satisfaction, of [IDENTIFY THE APPLICABLE OPERATIVE AGREEMENTS,
INCLUDING EACH MORTGAGE INSTRUMENT, RELATED UCC FIXTURE FILINGS, ADDITIONAL UCCS
(HEREINAFTER DEFINED), DEEDS AND MEMORANDA OF LEASE] and such other corporate
documents and records of each Credit Party, certificates of public officials and
representatives of each Credit Party as to certain factual matters, and such
other instruments and documents which we have deemed necessary or advisable to
examine for the purpose of this opinion. With respect to such examination, we
have assumed (i) the statements of fact made in all such certificates, documents
and instruments are true, accurate and complete; (ii) except as to each Credit
Party, the due authorization, execution and delivery of the Operative Agreements
by the parties thereto; (iii) the genuineness of all signatures (except as to
each Credit Party), the authenticity and completeness of all documents,
certificates, instruments, records and corporate records submitted to us as
originals and the conformity to the original instruments of all documents
submitted to us as copies, and the
B-1
94
authenticity and completeness of the originals of such copies; (iv) except as to
each Credit Party, that all parties have all requisite corporate power and
authority to execute, deliver and perform the Operative Agreements; and (v)
except as to the Lessee, the enforceability of the Operative Agreements against
all parties thereto.
Based on the foregoing, and having due regard for such legal considerations as
we deem relevant, and subject to the limitations and assumptions set forth
herein, including without limitation the matters set forth in the last two (2)
paragraphs hereof, we are of the opinion that:
(a) Each Mortgage Instrument and each Memorandum of Lease are
enforceable in accordance with their respective terms, except as limited by laws
generally affecting the enforcement of creditors' rights, which laws will not
materially prevent the realization of the benefits intended by such documents.
(b) Each form of Mortgage Instrument and UCC fixture filing relating
thereto, attached hereto as Schedules 1 and 2, respectively, is in proper form
for filing and recording with the offices of [IDENTIFY THE RECORDING OFFICES OF
THE RESPECTIVE COUNTY CLERKS WHERE THE PROPERTIES ARE TO BE LOCATED]. Upon
filing of each Mortgage Instrument and UCC fixture filing in [IDENTIFY THE
RECORDING OFFICES OF THE RESPECTIVE COUNTY CLERKS WHERE THE PROPERTIES ARE TO BE
LOCATED], the Agent will have a valid, perfected lien and security interest in
that portion of the Collateral described in such Mortgage Instrument or UCC
fixture filing to the extent such Collateral is comprised of real property
and/or fixtures.
(c) The forms of UCC financing statements relating to the Security
Documents, attached hereto as Schedule 3 (the "Additional UCCs"), are in proper
form for filing and recording with the offices of [IDENTIFY (I) THE RECORDING
OFFICES OF THE RESPECTIVE COUNTY CLERKS WHERE THE PROPERTIES ARE TO BE LOCATED
AND (II) THE SECRETARY OF STATE WHERE THE PROPERTIES ARE TO BE LOCATED]. Upon
filing of the Additional UCCs in [IDENTIFY (I) THE RECORDING OFFICES OF THE
RESPECTIVE COUNTY CLERKS WHERE THE PROPERTIES ARE TO BE LOCATED AND (II) THE
SECRETARY OF STATE WHERE THE PROPERTIES ARE TO BE LOCATED], the Agent will have
a valid, perfected lien and security interest in that portion of the Collateral
which can be perfected by filing UCC-1 financing statements under Article 9 of
the UCC.
(d) Each form of Deed and Memorandum of Lease is in appropriate form
for filing and recording with the [IDENTIFY THE RECORDING OFFICES OF THE
RESPECTIVE COUNTY CLERKS FOR THE COUNTIES WHERE THE PROPERTIES ARE TO BE
LOCATED].
(e) Each Memorandum of Lease, when filed and recorded with the
[IDENTIFY THE RECORDING OFFICES OF THE RESPECTIVE COUNTY CLERKS FOR THE COUNTIES
WHERE THE PROPERTIES ARE TO BE LOCATED], will have been filed and recorded in
all public offices in the State of __________ in which filing or recording is
necessary to provide constructive notice of the Lease to third Persons and to
establish of record the interest of the Lessor thereunder as to the Properties
described in each such Memorandum of Lease.
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(f) Title to the Properties located in the State of ___________ may be
held in the name of the Owner Trustee as follows: First Security Bank, National
Association, not individually, but solely as the Owner Trustee under the PHC
Real Estate Trust 1998-1.
(g) The execution and delivery by First Security Bank, National
Association, individually or as the Owner Trustee, as the case may be, of the
Operative Agreements to which it is a party and compliance by First Security
Bank, National Association, individually or as the Owner Trustee, with all of
the provisions thereof do not and will not contravene any law, rule or
regulation of [IDENTIFY THE STATE].
(h) By reason of their participation in the transaction contemplated
under the Operative Agreements, none of the Agent, the Lenders, the Holders or
the Owner Trustee has to (a) qualify as a foreign corporation in [IDENTIFY THE
STATE], (b) file any application or any designation for service of process in
[IDENTIFY THE STATE] or (c) pay any franchise, income, sales, excise, stamp or
other taxes of any kind to [IDENTIFY THE STATE].
(i) The provisions in the Operative Agreements concerning Rent,
interest, fees, prepayment premiums and other similar charges do not violate the
usury laws or other similar laws regulating the use or forbearance of money of
[IDENTIFY THE STATE].
(j) If the transactions contemplated by the Operative Agreements are
characterized as a lease transaction by a court of competent jurisdiction, the
Lease and the applicable Lease Supplement shall demise to the Lessee a valid
leasehold interest in the Properties described in such Lease Supplement.
(k) If the transactions contemplated by the Operative Agreements are
characterized as a loan transaction by a court of competent jurisdiction, the
combination of the Mortgage Instruments, the Deeds, the Lease and the applicable
Lease Supplements (and the other Operative Agreements incorporated therein by
reference) are sufficient to create a valid, perfected lien or security interest
in the Properties therein described, enforceable as a mortgage in [IDENTIFY THE
STATE].
(l) Except for the payment of a privilege tax in the amount of $______
pursuant to Tennessee Code Annotated ss.67-4-409 (b), no transfer, mortgage,
intangible, documentary stamp or similar taxes are presently payable to the
State of Tennessee or any political subdivision thereof on account of (i) the
execution and delivery of the Operative Agreements or (ii) the creation of the
indebtedness and the obligations evidenced thereby under the Operative
Agreements.
This opinion is limited to the matters stated herein and no opinion is implied
or may be inferred beyond the matters stated herein. This opinion is based on
and is limited to the laws of the State of ___________ and the federal laws of
the United States of America. Insofar as the foregoing opinion relates to
matters of law other than the foregoing, no opinion is hereby given.
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This opinion is for the sole benefit of the Lessee, the Construction Agent, the
Guarantors, the Owner Trustee, the Holders, the Lenders, the Agent and their
respective successors and assigns and may not be relied upon by any other person
other than such parties and their respective successors and assigns without the
express written consent of the undersigned. The opinions expressed herein are as
of the date hereof and we make no undertaking to amend or supplement such
opinions if facts come to our attention or changes in the current law of the
jurisdictions mentioned herein occur which could affect such opinions.
Very truly yours,
[LESSEE'S OUTSIDE COUNSEL]
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Distribution List
First Union National Bank, as the Agent, a Holder and a Lender
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Holders
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Lenders
Province Healthcare Company, as the Construction Agent and the Lessee
The various parties to the Participation Agreement from time to time, as the
Guarantors
First Security Bank, National Association, not individually, but solely as the
Owner Trustee under the PHC Real Estate Trust 1998-1
B-5
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Schedule 1
Form of Mortgage Instrument
B-6
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Schedule 2
Forms of UCC Fixture Filings
B-7
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Schedule 3
Forms of UCC Financing Statements
B-8
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EXHIBIT C
[Intentionally Omitted]
C-1
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EXHIBIT D
PROVINCE HEALTHCARE COMPANY
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(aa) of the Participation Agreement)
Province Healthcare Company, a Delaware corporation (the "Company"), DOES
HEREBY CERTIFY as follows:
1. Each and every representation and warranty of each Credit Party
contained in the Operative Agreements to which it is a party is true
and correct on and as of the date hereof.
2. No Default or Event of Default has occurred and is continuing under
any Operative Agreement.
3. Each Operative Agreement to which any Credit Party is a party is in
full force and effect with respect to it.
4. Each Credit Party has duly performed and complied with all covenants,
agreements and conditions contained in the Participation Agreement
(hereinafter defined) or in any Operative Agreement required to be
performed or complied with by it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement dated as of March 30, 1998 among the Company, as the Lessee and as the
Construction Agent, the various parties thereto from time to time, as guarantors
(the "Guarantors"), First Security Bank, National Association, as the Owner
Trustee, the various banks and other lending institutions which are parties
thereto from time to time, as holders (the "Holders"), the various banks and
other lending institutions which are parties thereto from time to time, as
lenders (the "Lenders"), and First Union National Bank, as the agent for the
Lenders and respecting the Security Documents, as the agent for the Lenders and
the Holders, to the extent of their interests (the "Agent").
IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be duly
executed and delivered as of this _____ day of __________, 1998.
PROVINCE HEALTHCARE COMPANY
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
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EXHIBIT E
[NAME OF CREDIT PARTY]
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(bb) of the Participation Agreement)
[NAME OF CREDIT PARTY], a Delaware corporation (the "Company") DOES HEREBY
CERTIFY as follows:
1. Attached hereto as Schedule 1 is a true, correct and complete copy of
the resolutions of the Board of Directors of the Company duly adopted
by the Board of Directors of the Company on __________. Such
resolutions have not been amended, modified or rescinded since their
date of adoption and remain in full force and effect as of the date
hereof.
2. Attached hereto as Schedule 2 is a true, correct and complete copy of
the Articles of Incorporation of the Company on file in the Office of
the Secretary of State of __________. Such Articles of Incorporation
have not been amended, modified or rescinded since their date of
adoption and remain in full force and effect as of the date hereof.
3. Attached hereto as Schedule 3 is a true, correct and complete copy of
the Bylaws of the Company. Such Bylaws have not been amended, modified
or rescinded since their date of adoption and remain in full force and
effect as of the date hereof.
4. The persons named below now hold the offices set forth opposite their
names, and the signatures opposite their names and titles are their
true and correct signatures.
Name Office Signature
---- ------ ---------
------------------- ----------------------- -------------------------
------------------- ----------------------- -------------------------
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IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be duly
executed and delivered as of this _____ day of ___________, 1998.
[NAME OF CREDIT PARTY]
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
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Schedule 1
BOARD RESOLUTIONS
E-3
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Schedule 2
ARTICLES OF INCORPORATION
E-4
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Schedule 3
BYLAWS
E-5
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EXHIBIT F
FIRST SECURITY BANK, NATIONAL ASSOCIATION
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(dd) of the Participation Agreement)
FIRST SECURITY BANK, NATIONAL ASSOCIATION, a national banking
association, not individually (except with respect to paragraph 1 below, to the
extent any such representations and warranties are made in its individual
capacity) but solely as the owner trustee under the PHC Real Estate Trust 1998-1
(the "Owner Trustee"), DOES HEREBY CERTIFY as follows:
1. Each and every representation and warranty of the Owner
Trustee contained in the Operative Agreements to which it is a
party is true and correct on and as of the date hereof.
2. Each Operative Agreement to which the Owner Trustee is a party
is in full force and effect with respect to it.
3. The Owner Trustee has duly performed and complied with all
covenants, agreements and conditions contained in the
Participation Agreement (hereinafter defined) or in any
Operative Agreement required to be performed or complied with
by it on or prior to the date hereof.
Capitalized terms used in this Officer's Certificate and not otherwise defined
herein have the respective meanings ascribed thereto in the Participation
Agreement dated as of March 30, 1998 among Province Healthcare Company as the
Lessee and as the Construction Agent, the various parties thereto from time to
time as guarantors (the "Guarantors"), the Owner Trustee, the various banks and
other lending institutions which are parties thereto from time to time, as
holders (the "Holders"), the various banks and other lending institutions which
are parties thereto from time to time, as Lenders (the "Lenders"), and First
Union National Bank, as the agent for the Lenders and respecting the Security
Documents, as the agent for the Lenders and the Holders, to the extent of their
interests (the "Agent").
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IN WITNESS WHEREOF, the Owner Trustee has caused this Officer's Certificate to
be duly executed and delivered as of this _____ day of __________, 1998.
FIRST SECURITY BANK, NATIONAL ASSOCIATION,
not individually, except as expressly
stated herein, but solely as the Owner
Trustee under the PHC Real Estate Trust
1998-1
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
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EXHIBIT G
FIRST SECURITY BANK, NATIONAL ASSOCIATION
OFFICER'S CERTIFICATE
(Pursuant to Section 5.3(ee) of the Participation Agreement)
CERTIFICATE OF ASSISTANT SECRETARY
I, ______________________, duly elected and qualified Assistant
Secretary of the Board of Directors of First Security Bank, National Association
(the "Association"), hereby certify as follows:
1. The Association is a National Banking Association duly organized,
validly existing and in good standing under the laws of the United States. With
respect thereto the following is noted:
A. Pursuant to Revised Statutes 324, et seq., as amended, 12 U.S.C.
1, et seq., the Comptroller of the Currency charters and exercises
regulatory and supervisory authority over all National Banking
Associations;
B. On December 9, 1881, the First National Bank of Ogden, Utah was
chartered as a National Banking Association under the laws of the
United States and under Charter No. 2597;
C. On October 2, 1922, in connection with a consolidation of The First
National Bank of Ogden, Ogden, Utah, and The Utah National Bank of
Ogden, Ogden, Utah, the title was changed to "The First & Utah
National Bank of Ogden"; on January 18, 1923, The First & Utah
National Bank of Ogden changed its title to "First Utah National
Bank of Ogden"; on January 19, 1926, the title was changed to "First
National Bank of Ogden"; on February 24, 1934, the title was changed
to "First Security Bank of Utah, National Association"; on June 21,
1996, the title was changed to "First Security Bank, National
Association"; and
D. First Security Bank, National Association, Ogden, Utah, continues to
hold a valid certificate to do business as a National Banking
Association.
2. The Association's Articles of Association, as amended, are in full
force and effect, and a true, correct and complete copy is attached hereto as
EXHIBIT A and incorporated herein by reference. Said Articles were last amended
October 20, 1975, as required by law on notice at a duly called special meeting
of the shareholders of the Association.
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3. The Association's By-Laws, as amended, are in full force and effect;
and a true, correct and complete copy is attached hereto as EXHIBIT B and
incorporated herein by reference. Said By-Laws, still in full force and effect,
were adopted September 17, 1942, by resolution, after proper notice of
consideration and adoption of By-Laws was given to each and every shareholder,
at a regularly called meeting of the Board of Directors with a quorum present.
4. Pursuant to the authority vested in it by an Act of Congress
approved December 23, 1913 and known as the Federal Reserve Act, as amended, the
Federal Reserve Board (now the Board of Governors of the Federal Reserve System)
has granted to the Association now known as "First Security Bank, National
Association" of Ogden, Utah, the right to act, when not in contravention of
State or local law, as trustee, executor, administrator, registrar of stocks and
bonds, guardian of estates, assignee, receiver, committee of estates of
lunatics, or in any other fiduciary capacity in which State banks, trust
companies or other corporations which come into competition with National Banks
are permitted to act under the laws of the State of Utah; and under the
provisions of applicable law, the authority so granted remains in full force and
effect.
5. Pursuant to authority vested by Act of Congress (12 ▇.▇.▇. ▇▇▇ ▇▇▇
▇▇ ▇.▇.▇. ▇▇▇, as amended) the Comptroller of the Currency has issued Regulation
9, as amended, dealing, in part, with the Fiduciary Powers of National Banks,
said regulation providing in subparagraph 9.7 (a) (1-2):
(1) The board of directors is responsible for the proper exercise of
fiduciary powers by the Bank. All matters pertinent thereto,
including the determination of policies, the investment and
disposition of property held in fiduciary capacity, and the
direction and review of the actions of all officers, employees, and
committees utilized by the Bank in the exercise of its fiduciary
powers, are the responsibility of the board. In discharging this
responsibility, the board of directors may assign, by action duly
entered in the minutes, the administration of such of the Bank's
fiduciary powers as it may consider proper to assign to such
director(s), officer(s), employee(s) or committee(s) as it may
designate.
(2) No fiduciary account shall be accepted without the prior approval
of the board, or of the director(s), officer(s), or committee(s) to
whom the board may have designated the performance of that
responsibility. . . .
6. A Resolution relating to Exercise of Fiduciary Powers was adopted by
the Board of Directors at a meeting held July 26, 1994 at which time there was a
quorum present; said resolution is still in full force and effect and has not
been rescinded. Said resolution is attached hereto as EXHIBIT C and incorporated
herein by reference.
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7. A Resolution relating to the Designation of Officers and Employees
to Exercise Fiduciary Powers was adopted by the Trust Policy Committee at a
meeting held February 7, 1996 at which time a quorum was present; said
resolution is still in full force and effect and has not been rescinded. Said
resolution is attached hereto as EXHIBIT D and is incorporated herein by
reference.
8. Attached hereto as EXHIBIT E and incorporated herein by reference,
is a listing of facsimile signatures of persons authorized (herein "Authorized
Signatory or Signatories") on behalf of the Association and its Trust Group to
act in exercise of its fiduciary powers subject to the resolutions in Paragraphs
6 and 7, above.
9. The principal office of the First Security Bank, National
Association, Trust Group and of its departments, except for the St. ▇▇▇▇▇▇,
Utah, Ogden, Utah, and Provo, Utah, branch offices, is located at ▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ and all records relating to fiduciary
accounts are located at such principal office of the Trust Group or in storage
facilities within Salt Lake County, Utah, except for those of the Ogden, Utah,
St. ▇▇▇▇▇▇, Utah, and Provo, Utah, branch offices, which are located at said
office.
10. Each Authorized Signatory (i) is a duly elected or appointed, duly
qualified officer or employee of the Association; (ii) holds the office or job
title set forth below his or her name on the date hereof; (iii) and the
facsimile signature appearing opposite the name of each such officer or employee
is a true replica of his or her signature.
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IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the
Association this __________ day of _________________, 1998.
(SEAL)
---------------------------
R. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Senior Vice President
Assistant Secretary
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EXHIBIT A
ARTICLES OF ASSOCIATION
G-5
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EXHIBIT B
BY-LAWS
G-6
116
EXHIBIT C
RESOLUTION RELATING TO
EXERCISE OF FIDUCIARY POWERS
G-7
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EXHIBIT D
RESOLUTION RELATING TO THE
DESIGNATION OF OFFICERS AND EMPLOYEES
TO EXERCISE FIDUCIARY POWERS
G-8
118
EXHIBIT E
AUTHORIZED SIGNATORY OR SIGNATORIES
G-9
119
EXHIBIT H
[The Owner Trustee's Outside Counsel Opinion]
(Pursuant to Section 5.3(ff) of the
Participation Agreement)
___________, 1998
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Trust Agreement dated as of March 30, 1998
Dear Sirs:
We have acted as special counsel for First Security Bank, National
Association, a national banking association, in its individual capacity ("FSB")
and in its capacity as trustee (the "Owner Trustee") under the Trust Agreement
dated as of March 30, 1998 (the "Trust Agreement") by and among it and the
various banks and other lending institutions which are parties thereto from time
to time, as holders (the "Holders"), in connection with the execution and
delivery by the Owner Trustee of the Operative Agreements to which it is a
party. Except as otherwise defined herein, the terms used herein shall have the
meanings set forth in Appendix A to the Participation Agreement dated as of
March 30, 1998 (the "Participation Agreement") by and among Province Healthcare
Company (the "Lessee"), the various parties thereto from time to time, as
guarantors (the "Guarantors"), First Security Bank, National Association, as the
Owner Trustee, the Holders, the various banks and other lending institutions
which are parties thereto from time to time, as lenders (the "Lenders") and
First Union National Bank, as the agent for the Lenders and respecting the
Security Documents, as the agent for the Lenders and the Holders, to the extent
of their interests (the "Agent").
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of such documents, corporate records and other instruments
as we have deemed necessary or advisable for the purpose of rendering this
opinion.
Based upon the foregoing, we are of the opinion that:
1. FSB is a national banking association duly organized, validly
existing and in good standing under the laws of the United States of America and
each of FSB and the Owner Trustee has under the laws of the State of Utah and
federal banking law the power and authority to enter into and perform its
obligations under the Trust Agreement and each other Operative Agreement to
which it is a party.
2. The Owner Trustee is the duly appointed trustee under the Trust
Agreement.
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3. The Trust Agreement has been duly authorized, executed and delivered
by one (1) of the officers of FSB and, assuming due authorization, execution and
delivery by the Holders, is a legal, valid and binding obligation of the Owner
Trustee (and to the extent set forth therein, against FSB), enforceable against
the Owner Trustee (and to the extent set forth therein, against FSB) in
accordance with its terms, and the Trust Agreement creates under the laws of the
State of Utah for the Holders the beneficial interest in the Trust Estate it
purports to create and is a valid trust under the laws of the State of Utah.
4. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by FSB, and, assuming due authorization,
execution and delivery by the other parties thereto, are legal, valid and
binding obligations of FSB, enforceable against FSB in accordance with their
respective terms.
5. The Operative Agreements to which it is party have been duly
authorized, executed and delivered by the Owner Trustee, and, assuming due
authorization, execution and delivery by the other parties thereto, are legal,
valid and binding obligations of the Owner Trustee, enforceable against the
Owner Trustee in accordance with their respective terms. The Notes and
Certificates have been duly issued, executed and delivered by the Owner Trustee,
pursuant to authorization contained in the Trust Agreement, and the Certificates
are entitled to the benefits and security afforded by the Trust Agreement in
accordance with its terms and the terms of the Trust Agreement.
6. The execution and delivery by each of FSB and the Owner Trustee of
the Trust Agreement and the Operative Agreements to which it is a party, and
compliance by FSB or the Owner Trustee, as the case may be, with all of the
provisions thereof do not and will not contravene any Laws applicable to or
binding on FSB, or as the Owner Trustee, or contravene the provisions of, or
constitute a default under, its charter documents or by-laws or, to our
knowledge after due inquiry, any indenture, mortgage contract or other agreement
or instrument to which FSB or Owner Trustee is a party or by which it or any of
its property may be bound or affected.
7. The execution and delivery of the Operative Agreements by each of
FSB and the Owner Trustee and the performance by each of FSB and the Owner
Trustee of their respective obligations thereunder does not require on or prior
to the date hereof the consent or approval of, the giving of notice to, the
registration or filing with, or the taking of any action in respect of any
Governmental Authority or any court.
8. Assuming that the trust created by the Trust Agreement is treated as
a grantor trust for federal income tax purposes within the contemplation of
Section 671 through 678 of the Internal Revenue Code of 1986, there are no fees,
taxes, or other charges (except taxes imposed on fees payable to the Owner
Trustee) payable to the State of Utah or any political subdivision thereof in
connection with the execution, delivery or performance by the Owner Trustee, the
Agent, the Lenders, the Lessee or the Holders, as the case may be, of the
Operative Agreements or in connection with the acquisition of any Property by
the Owner Trustee or in connection with the making by any Holder of its
investment in the Trust or its acquisition of the beneficial
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interest in the Trust Estate or in connection with the issuance and acquisition
of the Certificates, or the Notes, and neither the Owner Trustee, the Trust
Estate nor the trust created by the Trust Agreement will be subject to any fee,
tax or other governmental charge (except taxes on fees payable to the Owner
Trustee) under the laws of the State of Utah or any political subdivision
thereof on, based on or measured by, directly or indirectly, the gross receipts,
net income or value of the Trust Estate by reason of the creation or continued
existence of the trust under the terms of the Trust Agreement pursuant to the
laws of the State of Utah or the Owner Trustee's performance of its duties under
the Trust Agreement.
9. There is no fee, tax or other governmental charge under the laws of
the State of Utah or any political subdivision thereof in existence on the date
hereof on, based on or measured by any payments under the Certificates, Notes or
the beneficial interest in the Trust Estate, by reason of the creation of the
trust under the Trust Agreement pursuant to the laws of the State of Utah or the
Owner Trustee's performance of its duties under the Trust Agreement within the
State of Utah.
10. Upon the filing of the financing statement on form UCC-1 in the
form attached hereto as Schedule 1 with the Utah Division of Corporation and
Commercial Code, the Agent's security interest in the Trust Estate, for the
benefit of the Lenders and the Holders, will be perfected, to the extent that
such perfection is governed by Article 9 of the Uniform Commercial Code as in
effect in the State of Utah (the "Utah UCC").
Your attention is directed to the Utah UCC, which provides, in part,
that a filed financing statement which does not state a maturity date or which
states a maturity date of more than five (5) years is effective only for a
period of five (5) years from the date of filing, unless within six (6) months
prior to the expiration of said period a continuation statement is filed in the
same office or offices in which the original statement was filed. The
continuation statement must be signed by the secured party, identify the
original statement by file number and state that the original statement is still
effective. Upon the timely filing of a continuation statement, the effectiveness
of the original financing statement is continued for five (5) years after the
last date to which the original statement was effective. Succeeding continuation
statements may be filed in the same manner to continue the effectiveness of the
original statement.
The foregoing opinions are subject to the following assumptions, exceptions and
qualifications:
A. We are attorneys admitted to practice in the State of Utah and in
rendering the foregoing opinions we have not passed upon, or purported to pass
upon, the laws of any jurisdictions other than the State of Utah and the federal
banking law governing the banking and trust powers of FSB. In addition, without
limiting the foregoing we express no opinion with respect to (i) federal
securities laws, including the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, and the Trust Indenture Act of
1939, as amended, (ii) the Federal Aviation Act of 1958, as amended, (iii) the
Federal Communications Act of 1934, as amended, or (iv) state securities or blue
sky laws. Insofar as the foregoing opinions relate to the legality, validity,
binding effect and enforceability of the documents involved in these
transactions, which by their terms are governed by the laws of a state other
than Utah, we have
H-3
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assumed that the laws of such state (as to which we express no opinion), are in
all material aspects identical to the laws of the State of Utah.
B. The opinions set forth in paragraphs 3, 4, and 5 above are subject
to the qualification that enforceability of the Trust Agreement and the other
Operative Agreements to which FSB and the Owner Trustee are parties, in
accordance with their respective terms, may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium, receivership or similar laws affecting
enforcement of creditors' rights generally, and (ii) general principles of
equity, regardless of whether such enforceability is considered in a proceeding
in equity or at law.
C. As to the documents involved in these transactions, we have assumed
that each is a legal, valid and binding obligation of each party thereto, other
than FSB or the Owner Trustee, and is enforceable against each such party in
accordance with their respective terms.
D. We have assumed that all signatures, other than those of the Owner
Trustee or FSB, on documents and instruments involved in these transactions are
genuine, that all documents and instruments submitted to us as originals are
authentic, and that all documents and instruments submitted to us as copies
conform with the originals, which facts we have not independently verified.
E. We do not purport to be experts in respect of, or express any
opinion concerning laws, rules or regulations applicable to the particular
nature of the equipment or property involved in these transactions.
F. We have made no investigation of, and we express no opinion
concerning, the nature of the title to any part of the equipment or property
involved in these transactions or the priority of any mortgage or security
interest.
G. We have assumed that the Participation Agreement and the
transactions contemplated thereby are not within the prohibitions of Section 406
of the Employee Retirement Income Security Act of 1974.
H. In addition to any other limitation by operation of law upon the
scope, meaning, or purpose of this opinion, the opinions expressed herein speak
only as of the date hereof. We have no obligation to advise the recipients of
this opinion (or any third party) and make no undertaking to amend or supplement
such opinions if facts come to our attention or changes in the current law of
the jurisdictions mentioned herein occur which could affect such opinions the
legal analysis, a legal conclusion or any information confirmation herein.
I. This opinion is for the sole benefit of the Lessee, the Construction
Agent, the Guarantors, the Owner Trustee, the Holders, the Lenders, the Agent
and their respective successors and assigns in matters directly related to the
Participation Agreement or the transaction contemplated thereunder and may not
be relied upon by any other person other than such parties and their respective
successors and assigns without the express written consent of
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the undersigned. The opinions expressed in this letter are limited to the
matter set forth in this letter, and no other opinions should be inferred beyond
the matters expressly stated.
Very truly yours,
RAY, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
M. ▇▇▇▇ ▇▇▇▇▇▇
H-5
124
Distribution List
First Union National Bank, as the Agent, a Holder and a Lender
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Holders
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Lenders
Province Healthcare Company, as the Construction Agent and the Lessee
The various parties to the Participation Agreement from time to time, as the
Guarantors
First Security Bank, National Association, not individually, but solely as the
owner Trustee under the PHC Real Estate Trust 1998-1
H-6
125
EXHIBIT I
[Outside Counsel Opinion for the Lessee]
(Pursuant to Section 5.3(gg) of the Participation Agreement)
_____________, 1998
TO THOSE ON THE ATTACHED DISTRIBUTION LIST
Re: Synthetic Lease Financing Provided in favor of Province
Healthcare Company
Dear Sirs:
We have acted as special counsel to Province Healthcare Company, a Delaware
corporation (the "Lessee"), and the various parties to the Participation
Agreement (hereinafter defined) from time to time as guarantors (the
"Guarantors") in connection with certain transactions contemplated by the
Participation Agreement dated as of March 30, 1998 (the "Participation
Agreement"), among the Lessee, the Guarantors, First Security Bank, National
Association (the "Owner Trustee"), First Union National Bank as a holder
(together with the other holders, the "Holders"), First Union National Bank, as
a lender (together with the other lenders, the "Lenders"), and First Union
National Bank, as the agent for the Lenders and respecting the Security
Documents, as the agent for the Lenders and the Holders, to the extent of their
interests (the "Agent"). This opinion is delivered pursuant to Section 5.3(gg)
of the Participation Agreement. All capitalized terms used herein, and not
otherwise defined herein, shall have the meanings assigned thereto in Appendix A
to the Participation Agreement.
In connection with the foregoing, we have examined originals, or copies
certified to our satisfaction, of the Operative Agreements, and such other
corporate documents and records of the Credit Parties, certificates of public
officials and representatives of the Credit Parties as to certain factual
matters, and such other instruments and documents which we have deemed necessary
or advisable to examine for the purpose of this opinion. With respect to such
examination, we have assumed (i) the statements of fact made in all such
certificates, documents and instruments are true, accurate and complete; (ii)
the due authorization, execution and delivery of the Operative Agreements by the
parties thereto other than the Credit Parties; (iii) the genuineness of all
signatures (other than the signatures of persons signing on behalf of the Credit
Parties), the authenticity and completeness of all documents, certificates,
instruments, records and corporate records submitted to us as originals and the
conformity to the original instruments of all documents submitted to us as
copies, and the authenticity and completeness of the originals of such copies;
(iv) that all parties other than the Credit Parties have all requisite corporate
power and authority to execute, deliver and perform the Operative Agreements;
and (v) the enforceability of the Operative Agreements against all parties
thereto other than the Credit Parties and respecting the opinion set forth below
in section (i), First Security Bank, National Association, individually or as
the Owner Trustee, as the case may be. We have further assumed
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that the laws of the States of [STATE OF LAWYER'S ADMISSION] and [GOVERNING LAW
OF PARTICIPATION AGREEMENT] are substantially identical.
Based on the foregoing, and having due regard for such legal considerations as
we deem relevant, and subject to the limitations and assumptions set forth
herein, including without limitation the matters set forth in the last two (2)
paragraphs hereof, we are of the opinion that:
(a) Each Credit Party is a corporation duly incorporated, a limited
partnership duly formed [or a ________ duly formed], validly existing and in
good standing under the laws of the state of its formation and has the power and
authority to conduct its business as presently conducted and to execute, deliver
and perform its obligations under the Operative Agreements to which it is a
party. Each Credit Party is duly qualified to do business in all jurisdictions
in which its failure to so qualify would materially impair its ability to
perform its obligations under the Operative Agreements to which it is a party or
its financial position or its business as now and now proposed to be conducted.
(b) The execution, delivery and performance by each Credit Party of the
Operative Agreements to which it is a party have been duly authorized by all
necessary action on the part of each Credit Party and the Operative Agreements
to which each Credit Party is a party have been duly executed and delivered by
each Credit Party.
(c) The Operative Agreements to which each Credit Party is a party
constitute valid and binding obligations of each Credit Party enforceable
against each Credit Party in accordance with the terms thereof, subject to
bankruptcy, insolvency, liquidation, reorganization, fraudulent conveyance, and
similar laws affecting creditors' rights generally, and general principles of
equity (regardless of whether the application of such principles is considered
in a proceeding in equity or at law).
(d) The execution and delivery by each Credit Party of the Operative
Agreements to which it is a party and compliance by each Credit Party with all
of the provisions thereof do not and will not (i) contravene the provisions of,
or result in any breach of or constitute any default under, or result in the
creation of any Lien (other than Permitted Liens) upon any of its property
under, its respective Articles of Incorporation, By-Laws or other formation
documents or any indenture, mortgage, chattel mortgage, deed of trust, lease,
conditional sales contract, bank loan or credit agreement or other agreement or
instrument to which any Credit Party is a party or by which it or any of its
property may be bound or affected, or (ii) contravene any Laws or any order of
any Governmental Authority applicable to or binding on any Credit Party.
(e) No Governmental Action by, and no notice to or filing with, any
Governmental Authority is required for the due execution, delivery or
performance by any Credit Party of any of the Operative Agreements to which it
is a party or for the acquisition, ownership, construction and completion of the
Properties, except for those which have been obtained.
(f) Except as set forth on Schedule 1 hereto, there are no actions,
suits or proceedings pending or to our knowledge, threatened against any Credit
Party in any court or before any
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Governmental Authority, that concern the Properties or any Credit Party's
interest therein or that question the validity or enforceability of any
Operative Agreement to which any Credit Party is a party or the overall
transaction described in the Operative Agreements to which any Credit Party is a
party.
(g) Neither the nature of the Properties, nor any relationship between
any Credit Party and any other Person, nor any circumstance in connection with
the execution, delivery and performance of the Operative Agreements to which any
Credit Party is a party is such as to require any approval of stockholders of,
or approval or consent of any trustee or holders of indebtedness of, any Credit
Party, except for such approvals and consents which have been duly obtained and
are in full force and effect.
(h) The Security Documents which have been executed and delivered as of
the date of this opinion create, for the benefit of the Agent, the security
interests in the Collateral described therein which by their terms such Security
Documents purport to create. Upon filing of the UCC-1 financing statements
(attached hereto as Schedule 2) relating to the Security Documents in the
recording offices of (A) the respective county clerk where the principal place
of business of any Credit Party is located and (B) the Secretary of State where
the principal place of business of any Credit Party is located, the Agent will
have a valid, perfected lien and security interest in that portion of the
Collateral which can be perfected by the filing of UCC-1 financing statement
under Article 9 of the UCC in [IDENTIFY THE STATE].
(i) The Operative Agreements to which First Security Bank, National
Association, individually or as to the Owner Trustee, is a party constitute
valid and binding obligations of such party and are enforceable against First
Security Bank, National Association, individually or as the Owner Trustee, as
the case may be, in accordance with the terms thereof, subject to bankruptcy,
insolvency, liquidation, reorganization, fraudulent conveyance, and similar laws
affecting creditors, rights generally, and general principles of equity
(regardless of whether the application of such principles is considered in a
proceeding in equity or at law).
(j) The issuance, sale and delivery of the Notes and the issuance and
delivery of the Certificates under the circumstances contemplated by the
Participation Agreement do not, under existing law, require registration of the
Notes or the Certificates being issued on the date hereof under the Securities
Act of 1933, as amended, or the qualification of the Loan Agreement under the
Trust Indenture Act of 1939, as amended.
This opinion is limited to the matters stated herein and no opinion is implied
or may be inferred beyond the matters stated herein. This opinion is based on
and is limited to the laws of the States of __________________________________,
and the federal laws of the United States of America. Insofar as the foregoing
opinion relates to matters of law other than the foregoing, no opinion is hereby
given.
This opinion is for the sole benefit of the Lessee, the Construction Agent, the
Guarantors, the Owner Trustee, the Holders, the Lenders, the Agent and their
respective successors and assigns and may not be relied upon by any other person
other than such parties and their respective successors and assigns without the
express written consent of the undersigned. The opinions
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expressed herein are as of the date hereof and we make no undertaking to amend
or supplement such opinions if facts come to our attention or changes in the
current law of the jurisdictions mentioned herein occur which could affect such
opinions.
Very truly yours,
[LESSEE'S OUTSIDE COUNSEL]
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Distribution List
First Union National Bank, as the Agent, a Holder and a Lender
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Holders
The various banks and other lending institutions which are parties to the
Participation Agreement from time to time, as additional Lenders
Province Healthcare Company, as the Construction Agent and the Lessee
The various parties to the Participation Agreement from time to time, as the
Guarantors
First Security Bank, National Association, not individually, but solely as the
Owner Trustee under the PHC Real Estate Trust 1998-1
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Schedule 1
(Litigation)
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Schedule 2
(UCC-1 Financing Statements)
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EXHIBIT J
PROVINCE HEALTHCARE COMPANY
OFFICER'S CERTIFICATE
(Pursuant to Section 5.5 of the Participation Agreement)
PROVINCE HEALTHCARE COMPANY, a Delaware corporation (the "Company") DOES HEREBY
CERTIFY as follows:
1. The address for the subject Property is ______________________________
_____________________.
2. The Completion Date for the construction of Improvements at the
Property occurred on ______________.
3. The aggregate Property Cost for the Property was $___________.
4. Attached hereto as Schedule 1 is the detailed, itemized documentation
supporting the asserted Property Cost figures.
5. All representations and warranties of the Company in each Operative
Agreement and in each certificate delivered pursuant thereto (including
without limitation the Incorporated Representations and Warranties) are
true and correct as of the Completion Date.
Capitalized terms used in this Officer's Certificate and not otherwise defined
have the respective meanings ascribed thereto in the Participation Agreement
dated as of March 30, 1998 among the Company, as the Lessee and as the
Construction Agent, the parties thereto from time to time, as guarantors (the
"Guarantors"), First Security Bank, National Association, as the Owner Trustee,
the various banks and other lending institutions which are parties thereto from
time to time, as holders (the "Holders"), the various banks and other lending
institutions which are parties thereto from time to time, as lenders (the
"Lenders"), and First Union National Bank, as the agent for the Lenders and
respecting the Security Documents, as the agent for the Lenders and the Holders,
to the extent of their interests.
[The remainder of this page has been intentionally left blank.]
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IN WITNESS WHEREOF, the Company has caused this Officer's Certificate to be duly
executed and delivered as of this ____ day of ______________, ______.
PROVINCE HEALTHCARE COMPANY
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
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Schedule I
(Itemized Documentation in Support of Asserted Property Cost)
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EXHIBIT K
[Description of Material Litigation]
(Pursuant to Section 6.3(d) of the Participation Agreement)
1. Eastern Plumas Hospital District ▇. ▇▇▇▇ Healthcare, Inc., United
States District Court for the Eastern District of California. Eastern Plumas
Hospital District ("EPHD"), a debtor in bankruptcy, brought an adversary
proceeding against Brim Healthcare, Inc. ("Brim Healthcare") seeking a
declaratory judgment and damages in the amount of $12MM for breach of contract,
breach of fiduciary duty, fraud and negligence. By motion, the case was
withdrawn from the Bankruptcy Court and transferred to the United States
District Court. The dispute arises out of Brim Healthcare's performance of a
management agreement with EPHD, which agreement was terminated on November 22,
1994, by a written Termination Agreement. The Termination Agreement contains a
mutual release which, if effective, will act to bar all of EPHD's claims. The
Lessee believes that it has meritorious factual and legal defenses and has filed
a motion for summary judgment seeking a dismissal of the action based upon the
mutual release.
2. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, M.D. ▇. ▇▇▇▇ Healthcare, Inc., et al., Civil
District Court for ▇▇▇▇▇▇▇ Parish, Louisiana. Plaintiff, a physician formerly
employed directly by ▇▇▇▇▇▇▇ Parish Hospital, has sued the Lessee, two of its
employees, and other unrelated entities claiming breach of his employment
contract and seeking compensatory damages as well as earned but unpaid
compensation. The Lessee was, during the relevant time frame, the manager of the
hospital pursuant to a written agreement which contains an indemnity provision.
Because Plaintiff was terminated by the action of the hospital's board, the
Lessee has invoked its rights under the indemnity provision. The hospital has
acknowledged its indemnity obligation.
3. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇. Notice, pursuant to Article 4590i of the Texas
Civil Statutes, has been received by the Lessee's Memorial Mother ▇▇▇▇▇▇▇
Hospital ("Mother ▇▇▇▇▇▇▇"), informing the Lessee of the intent to initiate an
action for medical malpractice against Mother ▇▇▇▇▇▇▇ and others. The notice
asserts that ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, a minor, died following an appendectomy procedure
due to the negligence of his treating physician and nurses. The Lessee's
professional liability insurer has been placed on notice of this claim.
4. ▇▇▇▇▇▇ ▇▇▇▇▇▇ v. Ojai Valley Hospital, et al. ▇▇. ▇▇▇▇▇▇ has
commenced a medical malpractice action against Ojai Valley Hospital, which the
Lessee manages, the Lessee and various individuals because of a post-operative
infection which he claims to have received as a result of negligence on the part
of hospital personnel. This matter has been reported to the Lessee's
professional liability insurance carrier which has assumed the defense.
5. ▇▇▇▇ Dissiere, M.D. v. General Hospital, et al. The Lessee is one
defendant among others in this action alleging wrongful denial of medical staff
privileges. The Lessee's interests are being defended pursuant to an indemnity
agreement with General Hospital.
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6. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇ Healthcare Inc., et al., Case No. INC003693,
Superior Court for Riverside County, California. Plaintiff, a former employee of
San Gorgonio Memorial Hospital, a facility managed by the Lessee, has sued San
Gorgonio Memorial Hospital, a physician practice group, one of the physicians
who is a principal in the practice group, the Lessee and an employee of the
Lessee. Plaintiff claims that she was wrongfully fired from her job in
retaliation for her expressed intention to report what she claimed to be
substandard medical care delivered by the physicians who were practicing in the
San Gorgonio Memorial Hospital's emergency department. This case is still in the
early stages of discovery, however, preliminary investigation suggests to the
Lessee that it has numerous meritorious factual and legal defenses. The
hospital's insurance carrier has agreed to defend and indemnify Lessee's
employer in her capacity as CEO of the hospital. Lessee's request to the
hospital that it acknowledge contractual obligations to indemnfy Lessee is
pending before the hospital board.
7. ▇▇▇▇ ▇▇▇▇▇▇, et ux. ▇. ▇▇▇▇ Hospital, Inc., et al., United States
District Court for the Central District of California, Case No. 98-0623.
Plaintiff, a former employee of the Needles Desert Community Hospital, now known
as Colorado River Medical Center, has sued the Lessee and two of its agents
claiming that the defendants tortiously interfered with his contractual
relationship with Needles Desert Community Hospital resulting in his losing his
job. He has claimed an unspecified amount of damages for loss of employment,
loss of economic advantage and other theories. The defendants removed the case
from the state court, where plaintiff originally filed it, to the United States
District Court. This case is in its very earliest states and no discovery has
taken place. The Lessee believes that it has valid factual and legal defenses.
The Lessee's Directors' and Officers' liability insurer has acknowledged
coverage of certain claims.
8. ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ has asserted a claim against the Lessee claiming
that the Lessee breached an agreement whereby ▇▇▇▇▇▇ was to practice medicine at
Memorial Mother ▇▇▇▇▇▇▇ Hospital, in Palestine, Texas. He claims that he has
suffered damages in the total amount of $538,630. ▇▇▇▇▇▇ has not initiated any
litigation on this claim but has threatened to do so. The Lessee believes that
it has valid factual and legal defenses to any claim which ▇▇▇▇▇▇ might
subsequently file.
9. RRAC Contractors, Inc. ▇. ▇▇▇▇▇▇▇ Parish Hospital, et al., Second
Judicial District Court, ▇▇▇▇▇▇▇ Parish, Louisiana, Case No. 26,309. Plaintiff,
a heating and air conditioning contractor, has sued the Lessee's Brim
Healthcare, together with a publicly owned hospital and the governmental entity
which owns the hospital, to recover $55,431, which Plaintiff contends remains to
be paid on a contract for the installation of an HVAC system in the hospital.
Pursuant to a management agreement between the hospital and Brim Healthcare, the
hospital is obligated to indemnify Brim Healthcare for this claim. Brim
Healthcare invoked its right to indemnification; however, the hospital refused
to acknowledge its obligation. The Lessee has retained trial defense counsel and
intends to assert a cross-claim against the hospital for indemnification.
10. ▇▇▇▇▇▇ ▇▇▇▇▇▇, et al. ▇. ▇▇▇▇▇▇ Hospital, et al., District Court,
Park County, Wyoming, Civil Action No. 20289. Plaintiff has filed a medical
malpractice claim against the
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Lessee, a hospital managed by the Lessee, and various individuals claiming that
she suffered damages resulting from a medication error which occurred when she
was a patient in the hospital emergency room. The claim has been reported to the
Lessee's malpractice insurance carrier which has acknowledged coverage.
11. De ▇▇▇ ▇▇▇▇▇ v. Memorial Mother France Hospital. ▇▇. ▇▇▇▇▇ has
served the hospital (operated by the Lessee) with notice, under Article 4590i of
the Texas Civil Code, of her intent to initiate a medical malpractice claim. She
claims to have been a patient at the hospital on January 6, 1997 for delivery of
a baby under the care of Dr. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ and his professional practice
group. She asserts that negligent medical care caused her child to be
still-born. This claim has been reported to the Lessee's professional liability
insurance carrier.
12. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ v. ▇▇▇▇▇▇ ▇▇▇▇▇▇, Superior Court of California for
Humbolt County, Case No. DR 9700421. ▇▇. ▇▇▇▇▇▇ has sued the Lessee's Brim
Hospitals, Inc. subsidiary, her treating physician and General Hospital of
Eureka, California alleging otherwise unspecified acts of medical negligence and
seeking an unspecified amount of unliquidated damages. This case has been
reported to the Lessee's medical malpractice insurance carrier.
13. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, a minor v. Needles Desert Community Hospital,
Superior Court of California for San Bernadino, Case No. BCV-3306. Through his
legal guardian plaintiff, a minor, has sued his treating physician, ▇▇▇▇▇▇▇
▇▇▇▇, M.D. and the Needles Desert Community Hospital, now known as Colorado
River Medical Center, which the Lessee operates pursuant to a lease agreement
with the City of Needles, California. The lawsuit alleges that the plaintiff was
injured by otherwise unspecified medical negligence on the part of the
defendants.
14. U.S. Department of Justice Overbilling Claims. The United States
has asserted three claims against Lessee hospitals concerning overbilling:
(a) Parkview Regional Hospital. United States asserts that a
total of $22,561.85 was overbilled for a period of time from January
1992 through December 1996 in connection with the hospital's blood
chemistry CPT codes. The Government has proposed a settlement of three
times that amount, plus an additional $1,403.52, for a total of
$69,089.04. Officials of the Lessee are working cooperatively with both
the Government as well as the prior owner to resolve this dispute. It
is expected that the dispute will be resolved for significantly less
than the amount demanded.
(b) Memorial Mother ▇▇▇▇▇▇▇ Hospital. This claim is in the
process of being resolved. No money was paid by the Lessee, however, a
corporate compliance agreement for future billing activity with the
Government is required to be entered. The compliance agreement is
currently being negotiated.
(c) Colorado Plains Medical Center, Inc. On February 2, 1998,
the United States asserted a claim against this facility for duplicate
billing allegedly occurring between December 1, 1987 and December 31,
1991 totaling $2,052.44 for 23 claims. All amounts have been uncovered
by HCGA administratively. The Government now seeks
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penalties ($5,000 - $10,000 per claim) and treble damages under the
False Claims Act. The Government claims the Lessee's maximum exposure
for damages and penalties is thus $235,065.51. The Government will
require a corporate compliance agreement to be entered into and has
offered to settle the damage claim for $3,976.70.
15. ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇▇. Lessee has received correspondence from ▇▇▇▇
▇▇▇▇▇▇, Esq., an attorney practicing in Stockton, California, threatening to
file a lawsuit against Lessee's hospital in Eureka, California and against North
Coast Family Practice Clinic, an entity unrelated to Lessee. ▇▇. ▇▇▇▇▇▇ claims
that the hospital and North Coast have breached an oral agreement to purchase
his medical practice. Lessee denies that it ever entered into such an agreement
and believes that it would have valid legal and factual defense to any such
claim.
16. Various Medical Malpractice Claims. The Lessee has been named
defendant in various medical malpractice claims that are pending. All defense
counsel retained by the Lessee have reported that they reasonably anticipated
that any settlement or adverse verdict would be within the limits of available
insurance.
The Lessee, in its good faith judgment, believes that, as of the date
hereof, based on the Lessee's current knowledge, none of the above-referenced
litigation would result in a Material Adverse Effect.
For purposes of this Schedule 4.14, the term "Lessee" shall be deemed
to include Province Healthcare Company and its consolidated subsidiaries.
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EXHIBIT L
FORM OF
COMPLIANCE CERTIFICATE
THIS CERTIFICATE is given pursuant to Section 8.3(s) of the Participation
Agreement dated as of March 30, 1998 among Province Healthcare Company (the
"Company"), the various parties thereto from time to time, as the guarantors,
the various banks and other lending institutions parties thereto from time to
time, as the lenders, the various banks and other lending institutions parties
thereto from time to time, as the holders, First Security Bank, National
Association, as Owner Trustee under the PHC Real Estate Trust 1998-1 and First
Union National Bank, as the Agent (as amended, modified, supplemented, restated
and/or replaced from time to time, the "Participation Agreement"). Capitalized
terms used herein but not defined herein shall have the meanings provided in the
Participation Agreement.
The undersigned hereby certifies that:
1. I am the duly elected [Chief Executive Officer] [Chief Financial Officer]
[Vice President-Finance] [Vice President-Controller] of the Company and am
making this certification in my official capacity as such.
2. Enclosed with this Certificate are copies of the financial statements of the
Company and its Subsidiaries as of _____________, and for the [________-month
period] [year] then ended, required to be delivered under Section [5.1(a)]
[5.1(b)] of the Lessee Credit Agreement. Such financial statements are true and
accurate in all material respects and fairly present in all material respects
the financial condition of the Company and its Subsidiaries on a consolidated
basis as of the date indicated and the results of operations of the Company and
its Subsidiaries on a consolidated basis for the period covered thereby
(subject, in the case of interim statements, to the absence of footnote
disclosures and normal and reasonable year-end adjustments).
3. The undersigned has reviewed the terms of the Lessee Credit Agreement and has
made, or caused to be made under the supervision of the undersigned, a review in
reasonable detail of the transactions and condition of the Company and its
Subsidiaries during the accounting period covered by such financial statements.
4. The examination described in Paragraph 3 above did not disclose, and the
undersigned has no knowledge of the existence of, any Default or Event of
Default as of the date of this Certificate. [, except as set forth below.
Describe here or in a separate attachment any exceptions to Paragraph 4 above by
listing, in reasonable detail, the nature of the Default or Event of Default,
the period during which it existed and the action that the Company has taken or
proposes to take with respect thereto.]
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5. Attached to this Certificate as Attachments A and B, respectively, are a
Covenant Compliance Worksheet and an Interest Rate Calculation Worksheet
reflecting the computation of the financial covenants set forth in Article VI of
the Lessee Credit Agreement as of the last day of the period covered by the
financial statements enclosed herewith.
IN WITNESS WHEREOF, the undersigned has executed and delivered this Certificate
as of the _______ day of ___________, ____.
PROVINCE HEALTHCARE COMPANY
[signature of CEO, CFO, V.P. Finance,
or V.P.-Controller of Company]
Name:
--------------------------------
Title:
-------------------------------
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ATTACHMENT A
Covenant Compliance Worksheet
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RATIO OF CONSOLIDATED ADJUSTED DEBT TO ANNUALIZED NOT GREATER THAN OR EQUAL TO:
CONSOLIDATED EBITDAR (SECTION 6.9 OF THE 4.5 TO 1.0 THROUGH 12/31/98
CREDIT AGREEMENT): 5.0 TO 1.0 THEREAFTER(1)
---------------------------------------------------------------------------------------------------------------------
(1) Consolidated Adjusted Debt as of the measurement date
(a) Consolidated Debt as of the measurement date $__________
(b) Facility Rent Expense for two immediately $__________
preceding fiscal quarters then ending
(c) Multiply line 1(b) by two $__________
(d) Multiply line 1(c) by eight $__________
(e) Consolidated Adjusted Debt: $__________
Add lines (1)(a) and (1)(d)
(2) Annualized Consolidated EBITDAR for two immediately
preceding fiscal quarters then ending
(a) Consolidated Net Income for two immediately $__________
preceding fiscal quarters then ending
(b) The sum of the following for such period:
Interest Expense $__________
Taxes $__________
Depreciation $__________
Amortization $__________
Facility Rent Expense $__________
Minority Interests(2) $__________
$__________
--------------------------
(1) The ratio shall be not greater than or equal to 5.0 to 1.0 for all
periods after the completion by the Company of a subordinated debt offering of
at least $75,000,000 prior to December 31, 1998.
(2) To extent issuer of minority interest is obligated to pay debt
service on loans from Affiliates before making distributions.
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---------------------------------------------------------------------------------------------------------------------
RATIO OF CONSOLIDATED ADJUSTED DEBT TO ANNUALIZED NOT GREATER THAN OR EQUAL TO:
CONSOLIDATED EBITDAR (SECTION 6.9 OF THE 4.5 TO 1.0 THROUGH 12/31/98
CREDIT AGREEMENT): 5.0 TO 1.0 THEREAFTER(1)
---------------------------------------------------------------------------------------------------------------------
(c) Add lines (2)(a) and (2)(b) $__________
(d) Annualized Consolidated EBITDAR: $__________
Multiply line 2(c) by two(3)
(3) Ratio of Consolidated Adjusted Debt to Annualized _________
Consolidated EBITDAR:
Divide line (1)(e) by line (2)(d)
(3) Do not multiply losses of an extraordinary nature, included in
Consolidated Net Income in line 2(a) above, by two.
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---------------------------------------------------------------------------------------------------------------------
RATIO OF CONSOLIDATED ADJUSTED SENIOR DEBT TO
ANNUALIZED CONSOLIDATED EBITDAR
(SECTION 6.10 OF THE CREDIT AGREEMENT): NOT GREATER THAN OR EQUAL TO:
4.5 TO 1.0 THROUGH 12/31/98
4.0 TO 1.0 THROUGH 3/31/00
3.50 TO 1.0 THEREAFTER(4)
---------------------------------------------------------------------------------------------------------------------
(1) Consolidated Adjusted Senior Debt $__________
(a) Consolidated Adjusted Debt (from prior page) $__________
(b) Subordinated Debt $__________
(c) Consolidated Adjusted Senior Debt: $__________
Subtract line (1)(b) from line (1)(a)
(2) Annualized Consolidated EBITDAR (from prior page) $__________
(3) Ratio of Consolidated Adjusted Senior Debt to
Annualized Consolidated EBITDAR:
Divide Line (1)(c) by Line (2) __________
-----------------
(4) The ratio shall be not greater than or equal to 4.0 to 1.0 for all
periods after the completion by the Company of a subordinated debt offering of
at least $75,000,000 prior to December 31, 1998 through the period ending March
31, 2000.
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--------------------------------------------------------------------------------------------------------------------
ANNUALIZED JOINT VENTURE EBITDAR (SECTION 6.11
OF THE CREDIT AGREEMENT):
NOT GREATER THAN:
TWENTY PERCENT (20%) OF
ANNUALIZED CONSOLIDATED EBITDAR
--------------------------------------------------------------------------------------------------------------------
(1) Annualized Joint Venture EBITDAR for two immediately
preceding fiscal quarters then ending(5)
(a) Consolidated Net Income for Non-Wholly Owned $__________
Consolidated Subsidiaries for two immediately
preceding fiscal quarters then ending
(b) The sum of the following for Non-Wholly Owned Consolidated
Subsidiaries for such period
Interest Expense $__________
Taxes $__________
Depreciation $__________
Amortization $__________
Facility Rent Expense $__________
Minority Interests(6) $__________
$__________
(c) Add lines (1)(a) and (1)(b) $__________
(d) Annualized Joint Venture EBITDAR: $__________
Multiply line (1)(c) by two(7)
(2) Annualized Consolidated EBITDAR (from calculations for $__________
Section 6.9)
(3) Maximum Permitted Annualized Joint Venture EBITDAR: $__________
Multiply line (2) by .2
---------------------
(5) Exclude from line (1) calculations, EBITDAR related to the
Palestine Limited Partnership.
(6) To extent issuer of minority interest is obligated to pay debt
service on loans from Affiliates before making distributions.
(7) Do not multiply losses of an extraordinary nature, included in
Consolidated Net Income in line 1(a) above, by two.
L-6
145
--------------------------------------------------------------------------------------------------------------------
MINIMUM NET WORTH
(SECTION 6.12) OF THE CREDIT AGREEMENT NOT LESS THAN $84,000,000, PLUS 85%
OF CONSOLIDATED NET INCOME (BUT
EXCLUDING ANY NET LOSS) FROM JANUARY
1, 1998, PLUS 90% OF INCREASES IN THE
STATED CAPITAL AND ADDITIONAL PAID IN
CAPITAL ACCOUNTS OF THE COMPANY
RESULTING FROM THE ISSUANCE OF EQUITY
SECURITIES OR OTHER CAPITAL
INVESTMENTS AFTER THE AMENDMENT
EFFECTIVE DATE
--------------------------------------------------------------------------------------------------------------------
(1) $84,000,000 $84,000,000
(2) Consolidated Net Income (excluding any net loss) for $__________
all periods from and after January 1, 1998
(3) Multiply line (2) by .85 $__________
(4) Increases in the stated capital and additional paid in $__________
capital accounts of Borrower resulting from the issuance
of equity securities or other capital investments after
the Amendment Effective Date
(5) Multiply line (4) by .9 $__________
(6) Required Minimum Net Worth: $__________
Add lines (1), (3) and (5)
(7) Consolidated Net Worth at Measurement date: $__________
L-7
146
--------------------------------------------------------------------------------------------------------------------
FIXED CHARGE COVERAGE RATIO
(SECTION 6.13 OF THE CREDIT AGREEMENT): NOT LESS THAN OR EQUAL TO:
1.2 TO 1.0
--------------------------------------------------------------------------------------------------------------------
(1) Annualized Consolidated EBITDAR (from calculation for $__________
Section 6.9)
(2) Fixed Charges
(a) Scheduled Principal Payments $__________
(b) The sum of the following for the two fiscal
quarters then ending:
Interest Expense (payable in cash) $__________
Facility Rent Expense $__________
Cash Taxes $__________
(c) Multiply line 2(b) by two $__________
(d) Actual Capital Expenditures for four fiscal $__________
quarters then ending(8)
(e) Fixed Charges: Add lines (2)(a), (2)(c) and 2(d) $__________
(3) Ratio of Annualized Consolidated EBITDAR to Fixed Charges: __________
Divide line 1 by line 2(e)
---------------
(8) Excluding, for measurement dates ending on or prior to
September 30, 1998, aggregate acquisition expenditures and current building
programs incurred on or prior to December 31, 1997 at Parkview Regional
Hospital, Mexia, Texas and Colorado Plains Medical Center, Fort ▇▇▇▇▇▇,
Colorado, not to exceed $3,200,000).
L-8
147
--------------------------------------------------------------------------------------------------------------------
CAPITAL EXPENDITURES (SECTION 6.14 OF THE CREDIT AGREEMENT)
NOT GREATER THAN 5% OF CONSOLIDATED NET
REVENUES FOR THE FOUR FISCAL QUARTERS THEN
ENDING (EXCLUDING THROUGH SEPTEMBER 30, 1998
ACQUISITION EXPENDITURES AND CURRENT BUILDING
PROGRAMS AT PARKVIEW REGIONAL HOSPITAL, MEXIA,
TEXAS AND COLORADO PLAINS MEDICAL CENTER,
FORT ▇▇▇▇▇▇, COLORADO NOT
TO EXCEED $3,200,000)
--------------------------------------------------------------------------------------------------------------------
(1) Capital Expenditures for four fiscal quarters then __________
ending(9)
(2) Consolidated Net Revenues for such period $__________
(3) Maximum Permitted Capital Expenditures:
Multiply line (2) by 0.05 __________
--------------------------------------------------------------------------------------------------------------------
-----------------
(9) Excluding, for measurement dates on or prior to September 30,
1998, aggregate acquisition expenditures and current building programs at
Parkview Regional Hospital, Mexia, Texas and Colorado Plains Medical Center,
Fort ▇▇▇▇▇▇, Colorado not to exceed $3,200,000.
L-9
148
--------------------------------------------------------------------------------------------------------------------
ANNUALIZED NON-LANDLORD CONSENT EBITDAR (SECTION 6.15 OF THE
CREDIT AGREEMENT):
NOT GREATER THAN:
TEN PERCENT (10%) OF
ANNUALIZED CONSOLIDATED EBITDAR
--------------------------------------------------------------------------------------------------------------------
(1) Annualized Non-Landlord Consent EBITDAR for two
immediately preceding fiscal quarters then ending
(a) Consolidated Net Income, attributable to all $__________
Facility Leased Properties of the Company or
any Subsidiary for which a Landlord Consent has
not been delivered by the Agent, for two
immediately preceding fiscal quarters then
ending
(b) The sum of the following, attributable to all Facility Leased
Properties of the Borrower or any Subsidiary for which a
Landlord Consent has not been delivered by the Agent, for such
period
Interest Expense $__________
Taxes $__________
Depreciation $__________
Amortization $__________
Facility Rent Expense $__________
Minority Interests(10) $__________
(c) Add lines (1)(a) and (1)(b) $__________
(d) Annualized Non-Landlord Consent EBITDAR: $__________
Multiply line (1)(c) by two(1)
(10) To extent issuer of minority interest is obligated to pay debt
service on loans from Affiliates before making distributions.
(11) Do not multiply losses of an extraordinary nature, included in
Consolidated Net Income in line 1(a) above, by two.
L-10
149
--------------------------------------------------------------------------------------------------------------------
ANNUALIZED NON-LANDLORD CONSENT EBITDAR
(SECTION 6.15 OF THE CREDIT AGREEMENT):
NOT GREATER THAN:
TEN PERCENT (10%) OF
ANNUALIZED CONSOLIDATED EBITDAR
--------------------------------------------------------------------------------------------------------------------
(2) Annualized Consolidated EBITDAR (from calculations for $__________
Section 6.9)
(3) Maximum Permitted Annualized Non-Landlord Consent $__________
EBITDAR:
Multiply line (2) by .1
--------------------------------------------------------------------------------------------------------------------
PARKVIEW REGIONAL HOSPITAL/EBITDAR
TO FACILITY RENT EXPENSE
(SECTION 6.16 OF THE CREDIT AGREEMENT): NOT LESS THAN 1.75 TO 1.0 AT ANY TIME
--------------------------------------------------------------------------------------------------------------------
(1) EBITDAR of Parkview Regional Hospital for the period $__________
of determination
(2) Facility Rent Expense of Parkview Regional Hospital __________
for the period of determination
(3) Ration of EBITDAR to Facility Rent Expense for __________
Parkview Regional Hospital:
Divide line 1 by line ▇
▇-▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇▇ B
Interest Rate Calculation Worksheet
--------------------------------------------------------------------------------------------------------------------
RATIO OF CONSOLIDATED ADJUSTED DEBT TO ANNUALIZED CONSOLIDATED
EBITDAR:
--------------------------------------------------------------------------------------------------------------------
(1) Consolidated Adjusted Debt (from calculation for $__________
Section 6.9)
(2) Annualized Consolidated EBITDAR (From calculation for $__________
Section 6.9)
(3) Ratio of Consolidated Adjusted Debt to Annualized $__________
Consolidated EBITDAR:
Divide Line (1) by Line (2)
(4) Applicable Margin: EURODOLLAR __________%
ABR __________%
L-12
151
EXHIBIT M
JOINDER AGREEMENT
(Pursuant to Section 5.9 of the Participation Agreement)
THIS JOINDER AGREEMENT dated as of _____________, ___________ (as
amended, modified, supplemented, restated and/or replaced from time to time, the
"Agreement"), is by and between ___________________, a ___________ (the
"Company"), and FIRST UNION NATIONAL BANK, as the Agent for the Lenders and
respecting the Security Documents, as the Agent for the Lenders and the Holders,
to the extent of their interests (the "Agent"). Capitalized terms not otherwise
defined herein shall have the meanings set forth therefor in the Participation
Agreement dated as of March 30, 1998 (as amended, modified, supplemented,
restated and/or replaced from time to time, the "Participation Agreement") among
Province Healthcare Company, the various parties thereto from time to time, as
the Guarantors, First Security Bank, National Association, as the Owner Trustee
under the PHC Real Estate Trust 1998-1, the various banks and other lending
institutions which are parties thereto from time to time, as the Lenders, the
various banks and other lending institutions which are parties thereto from time
to time, as the Holders, and the Agent.
The Company is a Wholly-Owned Entity, and, consequently, the Credit
Parties are required by Section 8.3(r) of the Participation Agreement to cause
the Company to become a "Guarantor".
Accordingly, the Company hereby agrees as follows with the Agent, for
the benefit of the Financing Parties:
1. The Company hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the Company will be deemed to be a party to the
Participation Agreement and a "Guarantor" for all purposes of the Participation
Agreement and all other Operative Agreements, and shall have all of the
obligations of a Guarantor under the Operative Agreements as if the Company had
executed the Participation Agreement. The Company hereby ratifies, as of the
date hereof, and agrees to be bound by, all of the terms, provisions and
conditions applicable to the Guarantors contained in the Operative Agreements.
Without limiting the generality of the foregoing terms of this paragraph 1, the
Company hereby (i) jointly and severally together with the other Guarantors,
guarantees to each Financing Party, as provided in Sections 6B.1 through 6B.8 of
the Participation Agreement, the prompt payment and performance of the Company
Obligations in full when due (whether at stated maturity, as a mandatory
prepayment, by acceleration or otherwise) strictly in accordance with the terms
thereof.
2. THE COMPANY HEREBY EXPRESSLY ACKNOWLEDGES AND AGREES TO THE
PROVISIONS OF SECTION 12.8 OF THE PARTICIPATION AGREEMENT, INCLUDING WITHOUT
LIMITATION THOSE PROVISIONS REGARDING GOVERNING LAW, SUBMISSION TO JURISDICTION,
WAIVER OF
M-1
152
JURY TRIAL, VENUE AND ARBITRATION. THIS PROVISION HAS BEEN SPECIFICALLY REVIEWED
BY THE COMPANY.
3. The chief executive office and principal place of business of the
Company are located at the location(s) set forth on Schedule 1 attached hereto.
4. All notices and other communications to be delivered to the Company
shall be directed to Province Healthcare Company at its address set forth in
Section 12.3 of the Participation Agreement or such other address as may be
specified, in accordance with the terms of the Participation Agreement, by
Province Healthcare Company from time to time.
5. The Company hereby waives acceptance by the Financing Parties of the
guaranty by the Company under Sections 6B.1 through 6B.8 of the Participation
Agreement upon the execution of this Agreement by the Company.
6. This Agreement may be executed in multiple counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute one contract.
7. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NORTH CAROLINA.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly
executed by its authorized officers, and the Agent, for the benefit of the
Financing Parties, has caused the same to be accepted by its authorized officer,
as of the day and year first above written.
[COMPANY]
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
Acknowledged and accepted:
FIRST UNION NATIONAL BANK,
as the Agent
By:
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
M-2
153
EXHIBIT N
[States of Incorporation/Formation and Principal Place of Business of Each Guarantor]
(Pursuant to Section 6.3(i) of the Participation Agreement)
Guarantors State of Incorporation/ State of Principal
Formation Place of Business
BLYTHE-PROVINCE, INC. Tennessee Tennessee
BRIM EQUIPMENT SERVICES, INC. Oregon Tennessee
BRIM FIFTH AVENUE, INC. Oregon Tennessee
BRIM HEALTHCARE, INC. Oregon Tennessee
BRIM HOSPITALS, INC. Oregon Tennessee
BRIM OUTPATIENT SERVICES, INC. Oregon Tennessee
BRIM PAVILION, INC. Oregon Tennessee
BRIM SERVICES GROUP, INC. Oregon Tennessee
CARE HEALTH COMPANY, INC. Washington Tennessee
MEXIA-PRINCIPAL, INC. Texas Tennessee
PALESTINE-PRINCIPAL G.P., INC. Texas Tennessee
PALESTINE-PRINCIPAL, INC. Tennessee Tennessee
PHC-▇▇▇▇▇▇, INC. Louisiana Tennessee
PHC-LAKE HAVASU, INC. Arizona Tennessee
PHC OF DELAWARE, INC. Delaware Tennessee
PRINCIPAL HOSPITAL COMPANY OF NEVADA, INC. Nevada Tennessee
PRINCIPAL ▇▇▇▇ COMPANY Delaware Tennessee
PRINCIPAL-NEEDLES, INC. Tennessee Tennessee
MEXIA PRINCIPAL HEALTHCARE LIMITED PARTNERSHIP Texas Tennessee
PALESTINE PRINCIPAL HEALTHCARE LIMITED PARTNERSHIP Texas Tennessee
INTEGRATED HEALTH MANAGEMENT, LLC California Tennessee
N-1
154
Appendix A
Rules of Usage and Definitions
I. Rules of Usage
The following rules of usage shall apply to this Appendix A and the Operative
Agreements (and each appendix, schedule, exhibit and annex to the foregoing)
unless otherwise required by the context or unless otherwise defined therein:
(a) Except as otherwise expressly provided, any definitions set forth
herein or in any other document shall be equally applicable to the singular and
plural forms of the terms defined.
(b) Except as otherwise expressly provided, references in any document
to articles, sections, paragraphs, clauses, annexes, appendices, schedules or
exhibits are references to articles, sections, paragraphs, clauses, annexes,
appendices, schedules or exhibits in or to such document.
(c) The headings, subheadings and table of contents used in any
document are solely for convenience of reference and shall not constitute a part
of any such document nor shall they affect the meaning, construction or effect
of any provision thereof.
(d) References to any Person shall include such Person, its successors,
permitted assigns and permitted transferees.
(e) Except as otherwise expressly provided, reference to any agreement
means such agreement as amended, modified, extended, supplemented, restated
and/or replaced from time to time in accordance with the applicable provisions
thereof.
(f) Except as otherwise expressly provided, references to any law
includes any amendment or modification to such law and any rules or regulations
issued thereunder or any law enacted in substitution or replacement therefor.
(g) When used in any document, words such as "hereunder", "hereto",
"hereof" and "herein" and other words of like import shall, unless the context
clearly indicates to the contrary, refer to the whole of the applicable document
and not to any particular article, section, subsection, paragraph or clause
thereof.
(h) References to "including" means including without limiting the
generality of any description preceding such term and for purposes hereof the
rule of ejusdem generis shall not be applicable to limit a general statement,
followed by or referable to an enumeration of specific matters, to matters
similar to those specifically mentioned.
Appendix A-1
155
(i) References herein to "attorney's fees", "legal fees", "costs of
counsel" or other such references shall be deemed to exclude salary of the
Agent's regularly employed personnel and overhead.
(j) Each of the parties to the Operative Agreements and their counsel
have reviewed and revised, or requested revisions to, the Operative Agreements,
and the usual rule of construction that any ambiguities are to be resolved
against the drafting party shall be inapplicable in the construing and
interpretation of the Operative Agreements and any amendments or exhibits
thereto.
(k) Capitalized terms used in any Operative Agreements which are not
defined in this Appendix A but are defined in another Operative Agreement shall
have the meaning so ascribed to such term in the applicable Operative Agreement.
II. Definitions
"AAA" shall have the meaning given to such term in Section 12.8(d) of
the Participation Agreement.
"ABR" shall mean, for any day, a rate per annum equal to the greater of
(a) the Prime Lending Rate in effect on such day, and (b) the Federal Funds
Effective Rate in effect on such day plus one-half of one percent (0.5%). For
purposes hereof: "Prime Lending Rate" shall mean the rate announced by the Agent
from time to time as its prime lending rate as in effect from time to time. The
Prime Lending Rate is a reference rate and is one of several interest rate bases
used by the Agent and does not necessarily represent the lowest or most
favorable rate offered by the Agent actually charged to any customer. Any Lender
may make commercial loans or other loans at rates of interest at, above or below
the Prime Lending Rate. The Prime Lending Rate shall change automatically and
without notice from time to time as and when the prime lending rate of the Agent
changes. "Federal Funds Effective Rate" shall mean, for any period, a
fluctuating interest rate per annum equal for each day during such period to the
weighted average of the rates on overnight Federal funds transactions with
members or the Federal Reserve System arranged by Federal funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding 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 such day on such transactions received by the Agent from three
(3) Federal funds brokers of recognized standing selected by it. Any change in
the ABR due to a change in the Prime Lending Rate or the Federal Funds Effective
Rate shall be effective as of the opening of business on the effective day of
such change in the Prime Lending Rate or the Federal Funds Effective Rate,
respectively.
"ABR Holder Advance" shall mean a Holder Advance bearing a Holder Yield
based on the ABR.
Appendix A-2
156
"ABR Loans" shall mean Loans the rate of interest applicable to which
is based upon the ABR.
"Acceleration" shall have the meaning given to such term in Section 6
of the Credit Agreement.
"Accounts" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Acquisition Advance" shall have the meaning given to such term in
Section 5.3 of the Participation Agreement.
"Acquisition Loan" shall mean any Loan made in connection with an
Acquisition Advance.
"Additional Incorporated Terms" shall have the meaning given to such
term in Section 28.1 of the Lease.
"Advance" shall mean a Construction Advance or an Acquisition Advance.
"Affiliate" shall mean, with respect to any Person, any Person or group
acting in concert in respect of the Person in question that, directly or
indirectly, controls or is controlled by or is under common control with such
Person.
"After Tax Basis" shall mean, with respect to any payment to be
received, the amount of such payment increased so that, after deduction of the
amount of all taxes required to be paid by the recipient calculated at the then
maximum marginal rates generally applicable to Persons of the same type as the
recipients with respect to the receipt by the recipient of such amounts (less
any tax savings realized as a result of the payment of the indemnified amount),
such increased payment (as so reduced) is equal to the payment otherwise
required to be made.
"Agency Agreement" shall mean the Agency Agreement, dated on or about
the Initial Closing Date between the Construction Agent and the Lessor.
"Agency Agreement Event of Default" shall mean an "Event of Default" as
defined in Section 5.1 of the Agency Agreement.
"Agent" shall mean First Union National Bank, as agent for the Lenders
pursuant to the Credit Agreement, or any successor agent appointed in accordance
with the terms of the Credit Agreement and respecting the Security Documents,
for the Lenders and the Holders, to the extent of their interests.
"Annualized Consolidated EBITDAR" shall mean, as of the last day of any
fiscal quarter, Consolidated EBITDAR for the two (2) consecutive fiscal quarters
ending on such date,
Appendix A-3
157
multiplied by two (2); provided, that for purposes of this calculation, losses
of an extraordinary nature included in Consolidated Net Income shall not be
multiplied by two.
"Annualized Facility Rent Expense" shall mean, as of the last day of
any fiscal quarter, Facility Rent Expense for the two (2) consecutive fiscal
quarters ending on such date, multiplied by two (2).
"Applicable Percentage" shall mean, at any time with respect to any
Eurodollar Loan and the Lender Facility Fee, the applicable percentage points as
determined under the following matrix with reference to the ratio of
Consolidated Adjusted Debt to Annualized Consolidated EBITDAR, calculated as
provided below:
Ratio of
Consolidated Applicable Applicable Applicable Applicable
Adjusted Debt to Percentage for Percentage Percentage Percentage
Pricing Annualized Eurodollar for ABR for Lender for Holder
Level Consolidated EBITDAR Loans Loans Facility Fee Facility Fee
----- -------------------- ----- ----- ------------ ------------
Level I Less than 2.0 to 1.0 0.75% 0.00% 0.250% 0.250%
Level II Less that 2.5 to 1.0 1.00% 0.00% 0.250% 0.250%
but greater than or
equal to 2.0 to 1.0
Level III Less than 3.0 to 1.0 1.25% 0.00% 0.3125% 0.3125%
but greater than or
equal to 2.5 to 1.0
Level IV Less than 3.5 to 1.0 1.50% 0.25% 0.3125% 0.3125%
but greater than or
equal to 3.0 to 1.0
Appendix A-4
158
Level V Less than 4.0 to 1.0 1.75% 0.50% 0.375% 0.375%
but greater than or
equal to 3.5 to 1.0
Level VI Equal to of greater 2.00% 0.75% 0.500% 0.500%
than 4.0 to 1.0
From the Initial Closing Date until the fifth (5th) Business Day after receipt
by the Agent of the financial statements of Borrower for the fiscal quarter
ended March 31, 1998 (as delivered pursuant to Section 5.1(b) of the Lessee
Credit Agreement), the Applicable Percentages shall be based on Pricing Level
II. The Applicable Percentages shall be reset from time to time in accordance
with the above matrix on the fifth (5th) Business Day after receipt by the Agent
in accordance with Sections 5.1(a) or (b) of the Lessee Credit Agreement of
financial statements, together with a Compliance Certificate attaching an
Interest Rate Calculation worksheet (reflecting the computation of the ratio of
Consolidated Adjusted Debt to Annualized Consolidated EBITDAR as of the last day
of the preceding fiscal quarter or fiscal year, as appropriate) that provides
for different Applicable Percentages than those then in effect.
"Appraisal" shall mean, with respect to any Property, an appraisal to
be delivered in connection with the Participation Agreement or in accordance
with the terms of the Lease, in each case prepared by a reputable appraiser
reasonably acceptable to the Agent, which in the judgment of counsel to the
Agent, complies with all of the provisions of the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, as amended, the rules and regulations
adopted pursuant thereto, and all other applicable Legal Requirements.
"Appraisal Procedure" shall have the meaning given such term in Section
22.4 of the Lease.
"Approved State" shall mean any of the forty-eight states in the
continental United States.
"Appurtenant Rights" shall mean (a) all agreements, easements, rights
of way or use, rights of ingress or egress, privileges, appurtenances,
tenements, hereditaments and other rights and benefits at any time belonging or
pertaining to the Land underlying the Improvements or the Improvements,
including without limitation the use of any streets, ways, alleys, vaults or
strips of land adjoining, abutting, adjacent or contiguous to the Land and (b)
all permits, licenses and rights, appurtenant to such Land or the Improvements,
in each case which is of record or is known to the Lessee.
"Arbitration Rules" shall have the meaning given to such term in
Section 12.8(d) of the Participation Agreement.
"Assignment and Acceptance" shall mean the Assignment and Acceptance in
the form attached to the Credit Agreement as EXHIBIT B.
Appendix A-5
159
"Available Commitment" shall mean, as to any Lender at any time, an
amount equal to the excess, if any, of (a) the amount of such Lender's
Commitment over (b) the aggregate principal amount of all Loans made by such
Lender as of such date after giving effect to Section 5.2(d) of the
Participation Agreement (but without giving effect to any other repayments or
prepayments of any Loans hereunder).
"Available Holder Commitments" shall mean an amount equal to the
excess, if any, of (a) the aggregate amount of the Holder Commitments over (b)
the aggregate amount of the Holder Advances made since the Initial Closing Date
after giving effect to Section 5.2(d) of the Participation Agreement (but
without giving effect to any other repayments or prepayments of any Holder
Advances).
"Bankruptcy Code" shall mean Title 11 of the U. S. Code entitled
"Bankruptcy," as now or hereafter in effect or any successor thereto.
"Base Amount" shall have the meaning specified in Section 10.1(e) of
the Lease.
"Basic Rent" shall mean, the sum of (a) the Loan Basic Rent and (b) the
Lessor Basic Rent, calculated as of the applicable date on which Basic Rent is
due.
"Benefited Lender" shall have the meaning specified in Section 9.10(a)
of the Credit Agreement.
"▇▇▇▇ of Sale" shall mean a ▇▇▇▇ of Sale regarding Equipment in form
and substance satisfactory to the Agent.
"Board" shall mean the Board of Governors of the Federal Reserve System
of the United States (or any successor).
"Borrower" shall mean the Owner Trustee, not in its individual capacity
but as Borrower under the Credit Agreement.
"Borrowing Date" shall mean any Business Day specified in a notice
delivered pursuant to Section 2.3 of the Credit Agreement as a date on which the
Lessor requests the Lenders to make Loans hereunder.
"Budgeted Total Property Cost" shall mean, at any date of determination
with respect to any Construction Period Property, an amount equal to the
aggregate amount which the Construction Agent in good faith expects to be
expended in order to achieve Completion with respect to such Property.
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which commercial banks in Charlotte, North Carolina or any other states
from which the Agent, any Lender or any Holder funds or engages in
administrative activities with respect to the
Appendix A-6
160
transactions under the Operative Agreements are authorized or required by law to
close; provided, however, that when used in connection with a Eurodollar Loan,
the term "Business Day" shall also exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Capital Asset" shall mean any asset that would, in accordance with
GAAP, be required to be classified and accounted for as a capital asset.
"Capital Lease" shall mean any lease of any property that would, in
accordance with GAAP, be required to be classified and accounted for as a
capital lease on the balance sheet of the lessee.
"Capital Lease Obligation" shall mean, with respect to any Capital
Lease, the amount of the obligation of the lessee thereunder that would, in
accordance with GAAP, appear on a balance sheet as a liability of such lessee in
respect of such Capital Lease.
"Capital Stock" shall mean any nonredeemable capital stock of any
Credit Party or any of its Subsidiaries, whether common or preferred.
"Casualty" shall mean any damage or destruction of all or any portion
of the Property as a result of a fire or other casualty.
"CERCLA" shall mean the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, 42 U.S.C. ss. 9601 et seq., as amended
by the Superfund Amendments and Reauthorization Act of 1986.
"Certificate" shall mean a Certificate in favor of each Holder
regarding the Holder Commitment of such Holder issued pursuant to the terms and
conditions of the Trust Agreement in favor of each Holder.
"Change of Control" shall mean (i) any Person or "group" (within the
meaning of Section 13(d)(3) under the Exchange Act), shall, directly or
indirectly, as a result of a tender or exchange offer, open market purchases,
privately negotiated purchases or otherwise, have become, after the Initial
Closing Date, the "beneficial owner" (within the meanings of Rules 13d-3 and
13d-5 under the Exchange Act) of securities of the Lessee representing 30% or
more of the combined voting power of the then outstanding securities of the
Lessee ordinarily (and apart from rights accruing under special circumstances)
having the right to vote in the election of directors, assuming the conversion,
exchange or exercise into or for voting stock of all outstanding shares so
convertible (other than GTCR Fund IV, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ or ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ , which
currently are the beneficial owners of 36.6% of the voting securities of the
Lessee and may increase such holdings without causing a Change of Control), or
(ii) the members of the Board of Directors of the Lessee shall cease to consist
of a majority of the individuals (y) who constituted the Board of Directors as
of the Initial Closing Date or (z) who shall have become members thereof
subsequent to the Initial Closing Date after having been nominated, or otherwise
approved in writing, by at least a majority of individuals who constituted the
Board of Directors of the Lessee
Appendix A-7
161
as of the Initial Closing Date. For purposes of this definition, "voting power"
shall be determined with reference to the then outstanding securities of the
Lessee ordinarily (and apart from rights accruing under special circumstances)
having the right to vote in the election of directors, assuming the conversion,
exchange or exercise into or for voting stock of all outstanding securities of
the Lessee other than voting stock.
"Chattel Paper" shall have the meaning given to such term in Section 1
of the Security Agreement.
"Claims" shall mean any and all obligations, liabilities, losses,
actions, suits, penalties, claims, demands, costs and expenses (including
without limitation reasonable attorney's fees and expenses) of any nature
whatsoever.
"Closing Date" shall mean the Initial Closing Date and each Property
Closing Date.
"Code" shall mean the Internal Revenue Code of 1986 together with rules
and regulations promulgated thereunder, as amended from time to time, or any
successor statute thereto.
"Collateral" shall mean all assets of the Lessor, the Construction
Agent and the Lessee, now owned or hereafter acquired, upon which a Lien is
purported to be created by one or more of the Security Documents.
"Commencement Date" shall have the meaning specified in Section 2.2 of
the Lease.
"Commitment" shall mean, as to any Lender, the obligation of such
Lender to make the portion of the Loans to the Lessor in an aggregate principal
amount at any time outstanding not to exceed the amount set forth opposite such
Lender's name on Schedule 1.1 of the Credit Agreement, as such amount may be
increased or reduced from time to time in accordance with the provisions of the
Operative Agreements.
"Commitment Percentage" shall mean, as to any Lender at any time, the
percentage which such Lender's Commitment then constitutes of the aggregate
Commitments (or, at any time after the Commitments shall have expired or
terminated, the percentage which the aggregate principal amount of such Lender's
Loans then outstanding constitutes of the aggregate principal amount of all of
the Loans then outstanding), and such Commitment Percentage shall take into
account both the Lender's Tranche A Commitment and the Lender's Tranche B
Commitment.
"Commitment Period" shall mean the period from and including the
Initial Closing Date to and including the Construction Period Termination Date,
or such earlier date as the Commitments shall terminate as provided in the
Credit Agreement or the Holder Commitment shall terminate as provided in the
Trust Agreement.
"Company Obligations" shall mean the obligations of Province Healthcare
Company, in any and all capacities under and with respect to the Operative
Agreements and each Property.
Appendix A-8
162
"Completion" shall mean, with respect to a Property, such time as the
acquisition, installation, testing and final completion of the Improvements on
such Property has been achieved in accordance with the Plans and Specifications,
the Agency Agreement and/or the Lease, and in compliance with all Legal
Requirements (except if non-compliance, individually or in the aggregate, shall
not have and could not reasonably be expected to have a Material Adverse Effect)
and Insurance Requirements and a certificate of occupancy has been issued with
respect to such Property by the appropriate governmental entity. If the Lessor
purchases a Property that includes existing Improvements that are to be
immediately occupied by the Lessee, the date of Completion for such Property
shall be the Property Closing Date.
"Completion Date" shall mean, with respect to a Property, the earlier
of (a) the date on which Completion for such Property has occurred or (b) the
Construction Period Termination Date.
"Compliance Certificate" shall mean a fully completed certificate in
the form of EXHIBIT L.
"Condemnation" shall mean any taking or sale of the use, access,
occupancy, easement rights or title to any Property or any part thereof, wholly
or partially (temporarily or permanently), by or on account of any actual or
threatened eminent domain proceeding or other taking of action by any Person
having the power of eminent domain, including without limitation an action by a
Governmental Authority to change the grade of, or widen the streets adjacent to,
any Property or alter the pedestrian or vehicular traffic flow to any Property
so as to result in a change in access to such Property, or by or on account of
an eviction by paramount title or any transfer made in lieu of any such
proceeding or action.
"Consolidated Adjusted Debt" shall mean the sum of (a) Consolidated
Debt, and (b) the product of (i) Annualized Facility Rent Expense, multiplied by
(ii) eight (8).
"Consolidated Debt" shall mean, at any date, the aggregate (without
duplication) of all Debt of the Lessee and its Subsidiaries as of such date,
determined on a consolidated basis.
"Consolidated EBITDAR" shall mean, with respect to the Lessee and its
Subsidiaries on a consolidated basis as of the last day of any period, EBITDAR
for the period ending on such date determined in accordance with GAAP.
Consolidated EBITDAR shall be deemed to include without duplication, historical
Consolidated EBITDAR, of any business acquired and operated by the Lessee or any
Subsidiary after the commencement of the relevant measurement period, as if such
business had been acquired by the Lessee or such Subsidiary as of the first day
of such measurement period, subject to pro forma expense adjustments as set
forth below; provided that such Consolidated EBITDAR is supported by financial
statements, tax returns or other financial data acceptable to the Agent in its
sole discretion. Calculations of Consolidated EBITDAR shall exclude the results
of operations of any entity disposed of by the Lessee or any Subsidiary at any
time after the first day of the relevant measurement period. Consolidated
EBITDAR shall be adjusted for pro forma expense adjustments in connection with
newly acquired entities, if and only to the extent approved in writing by the
Majority Secured Parties.
Appendix A-9
163
"Consolidated Net Income" shall mean, for any fiscal quarter, the net
income (or loss) of the Lessee and its Subsidiaries, on a consolidated basis and
excluding intercompany items, for such quarter, determined in accordance with
GAAP, but excluding the effect of: (a) gains on the sale, conversion or other
disposition of Capital Assets, (b) gains on the acquisition, retirement, sale or
other disposition of stock of the Lessee or any of its Subsidiaries, (c) gains
on the collection of life insurance proceeds, (d) any write-up of any asset, (e)
any other gain or credit of an extraordinary nature, and (f) noncash losses
approved in writing by the Agent.
"Consolidated Subsidiary" shall mean, as to any Person, any Subsidiary
of such Person which under the rules of GAAP consistently applied should have
its financial results consolidated with those of such Person for purposes of
financial accounting statements.
"Construction Advance" shall mean an advance of funds to pay Property
Costs pursuant to Section 5.4 of the Participation Agreement.
"Construction Agent" shall mean Province Healthcare Company, a Delaware
corporation, as the construction agent under the Agency Agreement.
"Construction Budget" shall mean the cost of acquisition, installation,
testing, constructing and developing any Property as determined by the
Construction Agent in its reasonable, good faith judgment.
"Construction Commencement Date" shall mean, with respect to
Improvements, the date on which construction of such Improvements commences
pursuant to the Agency Agreement.
"Construction Contract" shall mean any contract entered into between
the Construction Agent or the Lessee with a Contractor for the construction of
Improvements or any portion thereof on the Property.
"Construction Loan" shall mean any Loan made in connection with a
Construction Advance.
"Construction Loan Property Cost" shall mean with respect to each
Construction Period Property at the date of determination, an amount equal to
(a) the aggregate principal amount of Construction Loans made on or prior to
such date with respect to the Property minus (b) the aggregate principal amount
of prepayments or repayments of the Loans allocated to reduce the Construction
Loan Property Cost of such Property pursuant to Section 2.6(c) of the Credit
Agreement.
"Construction Period" shall mean, with respect to a Property, the
period commencing on the Construction Commencement Date for such Property and
ending on the Completion Date for such Property.
Appendix A-10
164
"Construction Period Property" means, at any date of determination, any
Property as to which the Rent Commencement Date has not occurred on or prior to
such date.
"Construction Period Termination Date" shall mean (a) the earlier of
(i) the date that the Commitments have been terminated in their entirety in
accordance with the terms of Section 2.5(a) of the Credit Agreement, or (ii) the
second anniversary of the Initial Closing Date or (b) such later date as shall
be agreed to by the Majority Secured Parties.
"Contingent Obligation" shall mean, with respect to any Person, any
direct or indirect liability of such Person with respect to any Debt, lease,
dividend, guaranty, letter of credit (other than a standby letter of credit with
no reasonable likelihood of draw, in the reasonable opinion of the Agent) or
other obligation (the "primary obligation") of another Person (the "primary
obligor"), whether or not contingent (a) to purchase, repurchase or otherwise
acquire such primary obligations, (b) to advance or provide funds (i) for the
payment or discharge of any such primary obligations (ii) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency or any balance sheet item, level of income or financial
condition of the primary obligor, (c) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligator in respect thereof to make
payment of such primary obligation or (d) otherwise to assure or hold harmless
the owner of any such primary obligation against loss or failure or inability of
the primary obligor to perform in respect thereof. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by such Person in good faith.
"Contractor" shall mean each entity with whom the Construction Agent or
the Lessee contracts to construct any Improvements or any portion thereof on the
Property.
"Controlled Group" shall mean all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Lessee, are treated as a single employer
under Section 414 of the Code.
"Co-Owner Trustee" shall have the meaning specified in Section 9.2 of
the Trust Agreement.
"Credit Agreement" shall mean the Credit Agreement, dated on or about
the Initial Closing Date, among the Lessor, the Agent and the Lenders, as
specified therein.
"Credit Agreement Default" shall mean any event or condition which,
with the lapse of time or the giving of notice, or both, would constitute a
Credit Agreement Event of Default.
"Credit Agreement Event of Default" shall mean any event or condition
defined as an "Event of Default" in Section 6 of the Credit Agreement.
Appendix A-11
165
"Credit Documents" shall mean the Participation Agreement, the Credit
Agreement, the Notes and the Security Documents.
"Credit Parties" shall mean the Construction Agent, the Lessee and each
Guarantor.
"Debt" shall mean, with respect to any Person or group of Persons,
without duplication, (i) all indebtedness of such Person for money borrowed,
(ii) all reimbursement obligations of such Person with respect to surety bonds,
letters of credit and bankers' acceptances (in each case, whether or not
matured), (iii) all obligations of such Person evidenced by notes, bonds,
debentures or similar instruments, (iv) all obligations of such Person to pay
the deferred purchase price of property or services (including earnouts and
other similar contingent obligations, calculated in accordance with GAAP), other
than trade payables, (v) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (vi) all Capital Lease Obligations of such Person,
(vii) all monetary obligations and amounts owing of such Person under the
Operative Agreements or any other synthetic or end loaded lease facility of such
Person, (viii) the net termination obligations of such Person under any Swap
Agreement or other interest rate protection or hedging arrangement, calculated
as of any date as if such agreement or arrangement were terminated as of such
date, (ix) all obligations of such Person to purchase, redeem, retire, defease
or otherwise make any payment in respect of any capital stock or other equity
securities that, by their stated terms (or by the terms of any equity securities
issuable upon conversion thereof or in exchange therefor), or upon the
occurrence of any event, mature or are mandatorily redeemable, or are redeemable
at the option of the holder thereof, in whole or in part, (x) all indebtedness
referred to in clauses (i) through (ix) above secured by any lien on any
property or asset owned or held by such Person regardless of whether the
indebtedness secured thereby shall have been assumed by such Person or is
nonrecourse to the credit of such Person, and (xi) any Contingent Obligation of
such Person to the extent that such Contingent Obligation in accordance with
GAAP would be set forth in a specific Dollar amount on the liability side of a
balance sheet, and excluding any guaranty of Debt related to an operating lease,
provided that such guaranty will be included as a Contingent Obligation if the
guaranty is called and there is not a corresponding forgiveness of lease
payments in like amounts commencing in the order due, and provided, further,
that Contingent Obligations of such Person under the Operative Agreements shall
constitute "Debt" of such Person.
"Deed" shall mean a warranty deed regarding the Land and/or
Improvements in form and substance satisfactory to the Agent.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Holder" shall have the meaning given to such term in
Section 12.5 of the Participation Agreement.
Appendix A-12
166
"Defaulting Lender" shall have the meaning given to such term in
Section 12.5 of the Participation Agreement.
"Deficiency Balance" shall have the meaning given in Section 22.1(b) of
the Lease Agreement.
"Disputes" shall have the meaning given to such term in Section 12.8(d)
of the Participation Agreement.
"Documents" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Early Termination Conditions" shall mean (a) compliance with Section
8.3(j) of the Participation Agreement and (b) no Default or Event of Default
shall have occurred and be continuing, either at the date any election of the
Sale Option and/or the Purchase Option is elected in accordance with the
applicable provisions of the Lease (other than any such Default or Event of
Default that will be cured by the payment of Termination Value).
"EBITDAR" shall mean, for any Person for any fiscal quarter, (i)
Consolidated Net Income, plus (ii) the sum of Interest Expense, taxes,
depreciation, amortization, and Facility Rent Expense.
"Election Date" shall have the meaning given to such term in Section
20.1 of the Lease.
"Election Notice" shall have the meaning given to such term in Section
20.1 of the Lease.
"Eligible Assignee" shall mean (i) a commercial bank organized under
the laws of the United States or any state thereof and having total assets in
excess of $1,000,000,000, (ii) a commercial bank organized under the laws of any
other country that is a member of the OECD or a political subdivision of any
such country and having total assets in excess of $1,000,000,000, provided, that
such bank is acting through a branch or agency located in the United States, in
the country under the laws of which it is organized or in another country that
is also a member of the OECD, (iii) the central bank of any country that is a
member of the OECD, (iv) a finance company, mutual fund, insurance company or
other financial institution that is engaged in making, purchasing or otherwise
investing in commercial loans in the ordinary course of its business and having
total assets in excess of $250,000,000, (v) any Affiliate of an existing Lender
or (vi) any other Person (other than an Affiliate of any Credit Party) approved
by the Agent and the Lessee, which approval shall not be unreasonably withheld.
"Employee Benefit Plan" or "Plan" shall mean an employee benefit plan
(within the meaning of Section 3(3) of ERISA, including without limitation any
Multiemployer Plan), or any "plan" as defined in Section 4975(e)(1) of the Code
and as interpreted by the Internal Revenue
Appendix A-13
167
Service and the Department of Labor in rules, regulations, releases or bulletins
in effect on any Closing Date.
"Environmental Claims" shall mean any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative, judicial, or
private in nature) arising (a) pursuant to, or in connection with, an actual or
alleged violation of, any Environmental Law, (b) in connection with any
Hazardous Substance, (c) from any abatement, removal, remedial, corrective, or
other response action in connection with a Hazardous Substance, Environmental
Law, or other order of a Tribunal or (d) from any actual or alleged damage,
injury, threat, or harm to health, safety, natural resources, or the
environment.
"Environmental Laws" shall mean any Law, permit, consent, approval,
license, award, or other authorization or requirement of any Tribunal relating
to emissions, discharges, releases, threatened releases of any Hazardous
Substance into ambient air, surface water, ground water, publicly owned
treatment works, septic system, or land, or otherwise relating to the handling,
storage, treatment, generation, use, or disposal of Hazardous Substances,
pollution or to the protection of health or the environment, including without
limitation CERCLA, the Resource Conservation and Recovery Act, 42 U.S.C. ss.
6901, et seq., and state statutes analogous thereto.
"Environmental Violation" shall mean any activity, occurrence or
condition that violates or threatens (but only if the threat requires
remediation under any Environmental Law and is not remediated during any grace
period allowed under such Environmental Law) to violate or results in or
threatens (but only if the threat requires remediation under any Environmental
Law and is not remediated during any grace period allowed under such
Environmental Law) to result in noncompliance with any Environmental Law.
"Equipment" shall mean equipment, apparatus, furnishings, fittings and
personal property of every kind and nature whatsoever purchased, leased or
otherwise acquired using the proceeds of the Loans or the Holder Advances by the
Construction Agent, the Lessee or the Lessor and all improvements and
modifications thereto and replacements thereof, whether or not now owned or
hereafter acquired or now or subsequently attached to, contained in or used or
usable in any way in connection with any operation of any Improvements or other
improvements to real property, including but without limiting the generality of
the foregoing, all of the following to the extent acquired using the proceeds of
the Loans or the Holder Advances and all improvements and modifications thereto
and replacements thereof: all equipment described in the Appraisal including
without limitation all heating, electrical, and mechanical equipment, lighting,
switchboards, plumbing, ventilation, air conditioning and air-cooling apparatus,
refrigerating, and incinerating equipment, escalators, elevators, loading and
unloading equipment and systems, cleaning systems (including without limitation
window cleaning apparatus), telephones, communication systems (including without
limitation satellite dishes and antennae), televisions, computers, sprinkler
systems and other fire prevention and extinguishing apparatus and materials,
security systems, motors, engines, machinery, pipes, pumps, tanks, conduits,
appliances, fittings and fixtures of every kind and description.
Appendix A-14
168
"Equipment Schedule" shall mean (a) each Equipment Schedule attached to
the applicable Requisition and (b) each Equipment Schedule attached to the
applicable Lease Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"ERISA Affiliate" shall mean each entity required to be aggregated with
the Lessee pursuant to the requirements of Section 414(b) or (c) of the Code.
"Eurocurrency Reserve Requirements" shall mean for any day as applied
to a Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal) of reserve requirements in effect on such day
(including without limitation basic, supplemental, marginal and emergency
reserves under any regulations of the Board or other Governmental Authority
having jurisdiction with respect thereto) dealing with reserve requirements
prescribed on eurocurrency funding (currently referred to as "Eurocurrency
liabilities" in Regulation D) maintained by a member bank of the Federal Reserve
System.
"Eurodollar Holder Advance" shall mean a Holder Advance bearing a
Holder Yield based on the Eurodollar Rate.
"Eurodollar Loans" shall mean Loans the rate of interest applicable to
which is based upon the Eurodollar Rate.
"Eurodollar Rate" shall mean for the Interest Period for each
Eurodollar Loan or Eurodollar Holder Advance comprising part of the same
borrowing or advance (including without limitation conversions, extensions and
renewals), a per annum interest rate equal to the per annum rate determined by
the Agent on the basis of the offered rates for deposits in dollars for a period
of time corresponding to such Interest Period (and commencing on the first day
of such Interest Period), reported on Telerate page 3750 as of 11:00 a.m.
(London time) two (2) Business Days before the first day of such Interest
Period. In the event no such offered rates appear on Telerate page 3750,
"Eurodollar Rate" shall mean for the Interest Period for each Eurodollar Loan or
Eurodollar Holder Advance comprising part of the same borrowing or advance
(including without limitation conversions, extensions and renewals), a per annum
interest rate equal to the per annum rate determined by the Agent on the basis
of the offered rates for deposits in dollars for a period of time corresponding
to such Interest Period (and commencing on the first day of such Interest
Period), which appear on the Reuters Screen LIBO Page as of 11:00 a.m. (London
time) two (2) Business Days before the first day of such Interest Period
(provided that if at least two (2) such offered rates appear on the Reuters
Screen LIBO Page, the rate in respect of such Interest Period will be the
arithmetic mean of such offered rates). As used herein, "Reuters Screen LIBO
Page" means the display designated as page "LIBO" on the Reuters Monitor Money
Rates Service (or such other page as may replace the LIBO page on that service
for the purpose of displaying London interbank offered rates of major banks)
("RMMRS"). In the event the RMMRS is not then quoting such offered rates,
"Eurodollar Rate" shall mean for the Interest Period for each Eurodollar Loan or
Eurodollar Holder Advance
Appendix A-15
169
comprising part of the same borrowing or advance (including without limitation
conversions, extensions and renewals), the average (rounded upward to the
nearest one-sixteenth (1/16) of one percent (1%)) per annum rate of interest
determined by the office of the Agent (each such determination to be conclusive
and binding) as of two (2) Business Days prior to the first day of such Interest
Period, as the effective rate at which deposits in immediately available funds
in U.S. dollars are being, have been, or would be offered or quoted by the Agent
to major banks in the applicable interbank market for Eurodollar deposits at any
time during the Business Day which is the second Business Day immediately
preceding the first day of such Interest Period, for a term comparable to such
Interest Period and in the amount of the requested Eurodollar Loan and/or
Eurodollar Holder Advance. If no such offers or quotes are generally available
for such amount, then the Agent shall be entitled to determine the Eurodollar
Rate from another recognized service or interbank quotation, or by estimating in
its reasonable judgment the per annum rate (as described above) that would be
applicable if such quote or offers were generally available.
"Event of Default" shall mean a Lease Event of Default, an Agency
Agreement Event of Default or a Credit Agreement Event of Default.
"Excepted Payments" shall mean: (a) all indemnity payments (including
without limitation indemnity payments made pursuant to Section 11 of the
Participation Agreement), whether made by adjustment to Basic Rent or otherwise,
to which the Owner Trustee, any Holder or any of their respective Affiliates,
agents, officers, directors or employees is entitled;
(b) any amounts (other than Basic Rent or Termination Value) payable
under any Operative Agreement to reimburse the Owner Trustee, any Holder or any
of their respective Affiliates (including without limitation the reasonable
expenses of the Owner Trustee, the Trust Company and the Holders incurred in
connection with any such payment) for performing or complying with any of the
obligations of any Credit Party under and as permitted by any Operative
Agreement;
(c) any amount payable to a Holder by any transferee of such interest
of a Holder as the purchase price of such Holder's interest in the Trust Estate
(or a portion thereof);
(d) any insurance proceeds (or payments with respect to risks
self-insured or policy deductibles) under liability policies other than such
proceeds or payments payable to the Agent or any Lender;
(e) any insurance proceeds under policies maintained by the Owner
Trustee or any Holder;
(f) Transaction Expenses or other amounts, fees, disbursements or
expenses paid or payable to or for the benefit of the Owner Trustee or any
Holder;
Appendix A-16
170
(g) all right, title and interest of any Holder or the Owner Trustee to
any Property or any portion thereof or any other property to the extent any of
the foregoing has been released from the Liens of the Security Documents and the
Lease pursuant to the terms thereof;
(h) upon termination of the Credit Agreement pursuant to the terms
thereof, all remaining property covered by the Lease or Security Documents;
(i) all payments in respect of the Holder Yield;
(j) any payments in respect of interest to the extent attributable to
payments referred to in clauses (a) through (i) above; and
(k) any rights of either the Owner Trustee or the Trust Company to
demand, collect, ▇▇▇ for or otherwise receive and enforce payment of any of the
foregoing amounts, provided that such rights shall not include the right to
terminate the Lease.
"Excess Proceeds" shall mean the excess, if any, of the aggregate of
all awards, compensation or insurance proceeds payable in connection with a
Casualty or Condemnation over the Termination Value paid by the Lessee pursuant
to the Lease with respect to such Casualty or Condemnation.
"Exculpated Persons" shall mean the Borrower, the Holders, the Lessor,
their officers, directors, shareholders and partners.
"Expiration Date" shall have the meaning specified in Section 2.2 of
the Lease.
"Facility Fee" shall mean, collectively, the Holder Facility Fee and
the Lender Facility Fee.
"Facility Fee Payment Date" shall mean the last Business Day of each
January, April, July and October and the last Business Day of the Commitment
Period, or such earlier date as the Commitments shall terminate as provided in
the Credit Agreement or the Holder Commitment shall terminate as provided in the
Trust Agreement.
"Facility Rent Expense" shall mean, for any fiscal quarter, all amounts
paid, payable or accrued during such fiscal quarter by the Lessee and its
Subsidiaries on a consolidated basis with respect to all operating leases of
hospitals and the operating lease of any other facility with a Lease Expense in
excess of $200,000 annually; provided that Facility Rent Expense shall exclude
any amounts that constitute Debt pursuant to clause (vii) of the Debt
definition.
"Fair Market Sales Value" shall mean, with respect to any Property, the
amount, which in any event, shall not be less than zero (0), that would be paid
in cash in an arms-length transaction between an informed and willing purchaser
and an informed and willing seller, neither of whom is under any compulsion to
purchase or sell, respectively, such Property. Fair Market Sales Value of any
Property shall be determined based on the assumption that, except for purposes
of
Appendix A-17
171
Section 17 of the Lease, such Property is in the condition and state of repair
required under Section 10.1 of the Lease and each Credit Party is in compliance
with the other requirements of the Operative Agreements.
"Federal Funds Effective Rate" shall have the meaning given to such
term in the definition of ABR.
"Financing Party" shall mean each of the Lessor, the Owner Trustee, in
its trust capacity, the Agent, the Holders and/or the Lenders.
"Fixtures" shall mean all fixtures relating to the Improvements,
including without limitation all components thereof, located in or on the
Improvements, together with all replacements, modifications, alterations and
additions thereto.
"Force Majeure Event" shall mean any event beyond the control of the
Construction Agent, other than a Casualty or Condemnation, including without
limitation strikes, lockouts, adverse soil conditions, acts of God, adverse
weather conditions, inability to obtain labor or materials, governmental
activities, civil commotion and enemy action; but excluding any event, cause or
condition that results from the Construction Agent's financial condition.
"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 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.
"Form 4224" shall mean Form 4224 (Exemption from Withholding of Tax on
Income Effectively Connected with the Conduct of a Trade or Business in the
United States) of the Department of Treasury of the United States of America and
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.
"GAAP" shall mean generally accepted accounting principles, as
recognized by the American Institute of Certified Public Accountants,
consistently applied and maintained on a consistent basis for the Lessee and its
Subsidiaries on a consolidated basis throughout the period indicated and
consistent with the financial practice of the Lessee and its Subsidiaries after
the date hereof.
"Governmental Action" shall mean all permits, authorizations,
registrations, consents, assignments, approvals, waivers, exceptions, variances,
orders, judgments, written interpretations, decrees, licenses, exemptions,
publications, filings, notices to and declarations of or with, or required by,
any Governmental Authority, or required by any Legal Requirement, and shall
include, without limitation, all environmental and operating permits and
licenses that are required for the full use, occupancy, zoning and operating of
the Property.
Appendix A-18
172
"Governmental Authority" shall mean any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Ground Lease" shall mean a ground lease (in form and substance
satisfactory to the Agent) respecting any Property owned by the Lessee (or a
parent corporation or any Subsidiary of the Lessee) and leased to the Lessor
where such lease (a) has at least a ninety-nine (99) year term and payments set
at no more than $1.00 per year, or (b) is subject to such other terms and
conditions as are satisfactory to the Agent.
"GTCR Fund IV" shall mean Golder, Thoma, ▇▇▇▇▇▇, ▇▇▇▇▇▇ Fund IV, L.P.
"Guarantors" shall mean the various parties to the Participation
Agreement from time to time, as guarantors of the Construction Agent and the
Lessee with respect to the Operative Agreements and the Properties.
"Hard Costs" shall mean all costs and expenses payable for supplies,
materials, labor and profit with respect to the Improvements under any
Construction Contract.
"Hazardous Substance" shall mean any of the following: (a) any
petroleum or petroleum product, explosives, radioactive materials, asbestos,
formaldehyde, polychlorinated biphenyls, lead and radon gas; (b) any substance,
material, product, derivative, compound or mixture, mineral, chemical, waste,
gas, medical waste, or pollutant, in each case whether naturally occurring,
man-made or the by-product of any process, that is toxic, harmful or hazardous
to the environment or human health or safety as determined in accordance with
any Environmental Law; or (c) any substance, material, product, derivative,
compound or mixture, mineral, chemical, waste, gas, medical waste or pollutant
that would support the assertion of any claim under any Environmental Law,
whether or not defined as hazardous as such under any Environmental Law.
"HCFA" shall mean the United States Health Care Financing
Administration and any successor agency.
"Holder Advance" shall mean any advance made by any Holder to the Owner
Trustee pursuant to the terms of the Trust Agreement or the Participation
Agreement.
"Holder Amount" shall mean as of any date, the aggregate amount of
Holder Advances made by each Holder to the Trust Estate pursuant to Section 2 of
the Participation Agreement and Section 3.1 of the Trust Agreement less any
payments of any Holder Advances received by the Holders pursuant to Section 3.4
of the Trust Agreement.
"Holder Commitments" shall mean $1,050,000, as such amount may be
increased or decreased from time to time in accordance with the provisions of
the Operative Agreements; provided, if there shall be more than one (1) Holder,
the Holder Commitment of each Holder
Appendix A-19
173
shall be as set forth in Schedule I to the Trust Agreement as such Schedule I
may be amended and replaced from time to time.
"Holder Construction Property Cost" shall mean, with respect to each
Construction Period Property, at any date of determination, an amount equal to
the outstanding Holder Advances made with respect thereto under the Trust
Agreement.
"Holder Facility Fee" shall have the meaning given to such term in
Section 7.4 of the Participation Agreement.
"Holder Overdue Rate" shall mean the lesser of (a) the ABR plus two
percent (2%) and (b) the highest rate permitted by applicable law.
"Holder Property Cost" shall mean with respect to a Property an amount
equal to the outstanding Holder Advances with respect thereto.
"Holder Yield" shall mean with respect to Holder Advances from time to
time either the Eurodollar Rate plus 2.00% or the ABR plus 0.75% as elected by
the Owner Trustee from time to time with respect to such Holder Advances in
accordance with the terms of the Trust Agreement; provided, however, (a) upon
delivery of the notice described in Section 3.7(c) of the Trust Agreement, the
outstanding Holder Advances of each Holder shall bear a yield at the ABR plus
0.75% applicable from time to time from and after the dates and during the
periods specified in Section 3.7(c) of the Trust Agreement, and (b) upon the
delivery by a Holder of the notice described in Section 11.3(f) of the
Participation Agreement, the Holder Advances of such Holder shall bear a yield
at the ABR plus 0.75% applicable from time to time after the dates and during
the periods specified in Section 11.3(f) of the Participation Agreement.
"Holders" shall mean First Union National Bank and each of the other
banks and financial institutions which may be from time to time holders of
Certificates in connection with the PHC Real Estate Trust 1998-1.
"Impositions" shall mean, except to the extent described in the
following sentence, any and all liabilities, losses, expenses, costs, charges
and Liens of any kind whatsoever for fees, taxes, levies, imposts, duties,
charges, assessments or withholdings ("Taxes") including but not limited to (i)
real and personal property taxes, including without limitation personal property
taxes on any property covered by the Lease that is classified by Governmental
Authorities as personal property, and real estate or ad valorem taxes in the
nature of property taxes; (ii) sales taxes, use taxes and other similar taxes
(including rent taxes and intangibles taxes); (iii) excise taxes; (iv) real
estate transfer taxes, conveyance taxes, stamp taxes and documentary recording
taxes and fees; (v) taxes that are or are in the nature of franchise, income,
value added, privilege and doing business taxes, license and registration fees;
(vi) assessments on any Property, including without limitation all assessments
for public Improvements or benefits, whether or not such improvements are
commenced or completed within the Term; and (vii) taxes, Liens, assessments or
charges asserted, imposed or assessed by the PBGC or any governmental authority
succeeding to or performing functions similar to, the PBGC; and in each case all
Appendix A-20
174
interest, additions to tax and penalties thereon, which at any time prior to,
during or with respect to the Term or in respect of any period for which the
Lessee shall be obligated to pay Supplemental Rent, may be levied, assessed or
imposed by any Governmental Authority upon or with respect to (a) any Property
or any part thereof or interest therein; (b) the leasing, financing,
refinancing, demolition, construction, substitution, subleasing, assignment,
control, condition, occupancy, servicing, maintenance, repair, ownership,
possession, activity conducted on, delivery, insuring, use, operation,
improvement, sale, transfer of title, return or other disposition of such
Property or any part thereof or interest therein; (c) the Notes, other
indebtedness with respect to any Property, or the Certificates, or any part
thereof or interest therein; (d) the rentals, receipts or earnings arising from
any Property or any part thereof or interest therein; (e) the Operative
Agreements, the performance thereof, or any payment made or accrued pursuant
thereto; (f) the income or other proceeds received with respect to any Property
or any part thereof or interest therein upon the sale or disposition thereof;
(g) any contract (including the Agency Agreement) relating to the construction,
acquisition or delivery of the Improvements or any part thereof or interest
therein; (h) the issuance of the Notes or the Certificates; (i) the Owner
Trustee, the Trust or the Trust Estate; or (j) otherwise in connection with the
transactions contemplated by the Operative Agreements.
"Improvements" shall mean, with respect to the construction,
renovations and/or Modifications on any Land, all buildings, structures,
Fixtures, and other improvements of every kind existing at any time and from
time to time on or under the Land purchased, leased or otherwise acquired using
the proceeds of the Loans or the Holder Advances or is otherwise leased pursuant
to the Lease and in all cases, is encumbered by a first priority, perfected
Mortgage Instrument, together with any and all appurtenances to such buildings,
structures or improvements, including without limitation sidewalks, utility
pipes, conduits and lines, parking areas and roadways, and including without
limitation all Modifications and other additions to or changes in the
Improvements at any time, including without limitation (a) any Improvements
existing as of the Property Closing Date as such Improvements may be referenced
on the applicable Requisition and (b) any Improvements made subsequent to such
Property Closing Date.
"Incorporated Covenants" shall have the meaning given to such term in
Section 28.1 of the Lease.
"Incorporated Representations and Warranties" shall have the meaning
given to such term in Section 28.1 of the Lease.
"Indebtedness" of a Person shall mean, without duplication, such
Person's:
(a) obligations for borrowed money;
(b) obligations representing the deferred purchase price of
Property (whether real, personal, tangible, intangible or mixed) or
services (other than accounts payable arising in the ordinary course of
such Person's business payable on terms customary in the trade);
Appendix A-21
175
(c) obligations, whether or not assumed, secured by liens or
payable out of the proceeds or production from property now or
hereafter owned or acquired by such Person;
(d) obligations which are evidenced by notes, acceptances or
other instruments;
(e) Capital Lease Obligations;
(f) net liabilities under interest rate swap, exchange or cap
agreements; and
(g) contingent obligations.
"Indemnified Person" shall mean the Lessor, the Owner Trustee, in its
individual and its trust capacity, the Trust, the Trust Company, the Agent, the
Holders, the Lenders and their respective successors, assigns, directors,
shareholders, partners, officers, employees, agents and Affiliates.
"Indemnity Provider" shall mean, respecting each Property, the Lessee.
"Initial Closing Date" shall mean March 30, 1998.
"Initial Construction Advance" shall mean any initial Advance to pay
for: (a) Property Costs for construction of any Improvements; and (b) the
Property Costs of restoring or repairing any Property which is required to be
restored or repaired in accordance with Section 15.1(e) of the Lease.
"Instruments" shall have the meaning given to such term in Section 1 of
the Security Agreement.
"Insurance Requirements" shall mean all terms and conditions of any
insurance policy either required by the Lease to be maintained by the Lessee or
required by the Agency Agreement to be maintained by the Construction Agent, and
all requirements of the issuer of any such policy and, regarding self insurance,
any other requirements of the Lessee.
"Interest Expense" shall mean, for any fiscal quarter, total interest
expense of the Lessee and its Subsidiaries on a consolidated basis for such
fiscal quarter (including, without limitation, interest expense attributable to
Capital Lease Obligations), determined in accordance with GAAP and all lease
payments made by the Lessee and its Subsidiaries pursuant to the Operative
Agreements.
"Interest Period" shall mean (a) during the Commitment Period and
thereafter as to any Eurodollar Loan or Eurodollar Holder Advance (i) with
respect to the initial Interest Period, the period beginning on the date of the
first Eurodollar Loan and Eurodollar Holder Advance and
Appendix A-22
176
ending one (1) month, two (2) months or three (3) months thereafter, as selected
by the Lessor (in the case of a Eurodollar Loan) or the Owner Trustee (in the
case of a Eurodollar Holder Advance) in its applicable notice given with respect
thereto and (ii) thereafter, each period commencing on the last day of the next
preceding Interest Period applicable to such Eurodollar Loan or Eurodollar
Holder Advance and ending one (1) month, two (2) months or three (3) months
thereafter, as selected by the Lessor by irrevocable notice to the Agent (in the
case of a Eurodollar Loan) or by the Owner Trustee (in the case of a Eurodollar
Holder Advance) in each case not less than three (3) Business Days prior to the
last day of the then current Interest Period with respect thereto; provided,
however, that all of the foregoing provisions relating to Interest Periods are
subject to the following: (A) if any Interest Period would end on a day which is
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day (except that where the next succeeding Business Day
falls in the next succeeding calendar month, then on the next preceding Business
Day), (B) no Interest Period shall extend beyond the Maturity Date or the
Expiration Date, as the case may be, (C) where an Interest Period begins on a
day for which there is no numerically corresponding day in the calendar month in
which the Interest Period is to end, such Interest Period shall end on the last
Business Day of such calendar month, and (D) there shall not be more than four
(4) Interest Periods outstanding at any one (1) time.
"Interest Rate Calculation Worksheet" shall mean a fully completed
worksheet in the form of Attachment B to Exhibit L.
"Interests" shall mean all ownership or profit-sharing interests
(howsoever designated) in any general or limited partnership, limited liability
company or joint venture, and all agreements, instruments and documents
convertible, in whole or in part, into any one or more or all of the foregoing.
"Investment Company Act" shall mean the Investment Company Act of 1940,
as amended, together with the rules and regulations promulgated thereunder.
"Joinder Agreement" shall mean a joinder agreement, in the form of
EXHIBIT M to the Participation Agreement, executed from time to time between a
Wholly-Owned Entity and the Agent.
"Land" shall mean a parcel of real property described on (a) the
Requisition issued by the Construction Agent on the Property Closing Date
relating to such parcel and (b) the schedules to each applicable Lease
Supplement executed and delivered in accordance with the requirements of Section
2.4 of the Lease.
"Law" shall mean any statute, law, ordinance, regulation, rule,
directive, order, writ, injunction or decree of any Tribunal.
"Lease" or "Lease Agreement" shall mean the Lease Agreement dated on or
about the Initial Closing Date, between the Lessor and the Lessee, together with
any Lease Supplements thereto.
Appendix A-23
177
"Lease Default" shall mean any event or condition which, with the lapse
of time or the giving of notice, or both, would constitute a Lease Event of
Default.
"Lease Event of Default" shall have the meaning specified in Section
17.1 of the Lease.
"Lease Expense" shall mean, for any fiscal quarter, all amounts paid,
payable or accrued during such fiscal quarter by the Borrower and its
Subsidiaries on a consolidated basis with respect to all leases and rental
agreements, including, without limitation, all amounts paid as Facility Rent
Expense, of the Lessee and its Subsidiaries, other than Capital Leases,
determined in accordance with GAAP; provided that Lease Expense shall exclude
any amounts that constitute Debt pursuant to clause (vii) of the Debt
definition.
"Lease Supplement" shall mean each Lease Supplement substantially in
the form of EXHIBIT A to the Lease, together with all attachments and schedules
thereto.
"Legal Requirements" shall mean all foreign, federal, state, county,
municipal and other governmental statutes, laws, rules, orders, regulations,
ordinances, judgments, decrees and injunctions affecting the Owner Trustee, any
Holder, the Lessor, any Credit Party, the Agent, any Lender or any Property,
Land, Improvement, Equipment or the taxation, demolition, construction, use or
alteration of such Improvements, whether now or hereafter enacted and in force,
including without limitation any that require repairs, modifications or
alterations in or to any Property or in any way limit the use and enjoyment
thereof (including without limitation all building, zoning and fire codes and
the Americans with Disabilities Act of 1990, 42 U.S.C. ss. 12101 et. seq., and
any other similar federal, state or local laws or ordinances and the regulations
promulgated thereunder) and any that may relate to environmental requirements
(including without limitation all Environmental Laws), and all permits,
certificates of occupancy, licenses, authorizations and regulations relating
thereto, and all covenants, agreements, restrictions and encumbrances contained
in any instruments which are either of record or known to any Credit Party
affecting any Property or the Appurtenant Rights.
"Lender Commitments" shall mean $33,950,000, as such amount may be
increased or reduced from time to time in accordance with the provisions of the
Operative Agreements; provided, if there shall be more than one (1) Lender, the
Lender Commitment of each Lender shall be as set forth in Schedule 1.1 to the
Credit Agreement as such Schedule 1.1 may be amended and replaced from time to
time.
"Lender Facility Fee" shall have the meaning given to such term in
Section 7.4 of the Participation Agreement.
"Lender Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdiction in order to procure a security interest in favor of the
Agent in the Collateral subject to the Security Documents.
Appendix A-24
178
"Lenders" shall mean First Union National Bank and each of the other
banks and financial institutions which may be from time to time party to the
Participation Agreement and the Credit Agreement.
"Lessee" shall have the meaning set forth in the Lease.
"Lessee Credit Agreement" shall mean that certain Amended and Restated
Credit Agreement dated as of March 30, 1998 between the Lessee, First Union
National Bank, as Agent and various financial institutions party thereto, as
such may hereafter be amended, modified, supplemented, restated and/or replaced
from time to time.
"Lessee Credit Agreement Event of Default" shall mean an Event of
Default as defined in Article VII of the Lessee Credit Agreement.
"Lessee's Equipment" shall mean equipment which (a) is personal
property or a fixture but otherwise shall not constitute real property, (b) is
not financed with any Advance, (c) is not a replacement for any Equipment, (d)
is not a Modification required by any Legal Requirement or any Insurance
Requirement, (e) is not necessary or appropriate for the mechanical operation,
utility service, structure or for any other such purpose relating to the
physical plant of any Property and (f) may be removed from any Property without
causing material damage to such Property.
"Lessor" shall mean the Owner Trustee, not in its individual capacity,
but as the Lessor under the Lease.
"Lessor Basic Rent" shall mean the Holder Yield due on the Holder
Advances on any Scheduled Interest Payment Date pursuant to the Trust Agreement
(but not including interest on (a) any such scheduled Holder Yield due on the
Holder Advances prior to the Rent Commencement Date with respect to the Property
to which such Holder Advances relate or (b) overdue amounts under the Trust
Agreement or otherwise).
"Lessor Financing Statements" shall mean UCC financing statements and
fixture filings appropriately completed and executed for filing in the
applicable jurisdictions in order to protect the Lessor's interest under the
Lease to the extent the Lease is a security agreement or a mortgage.
"Lessor Lien" shall mean any Lien, true lease or sublease or
disposition of title arising as a result of (a) any claim against the Lessor or
the Trust Company, in its individual capacity, not resulting from the
transactions contemplated by the Operative Agreements, (b) any act or omission
of the Lessor or the Trust Company, in its individual capacity, which is not
required by the Operative Agreements or is in violation of any of the terms of
the Operative Agreements, (c) any claim against the Lessor or the Trust Company,
in its individual capacity, with respect to Taxes or Transaction Expenses
against which the Lessee is not required to indemnify the Lessor or the Trust
Company, in its individual capacity, pursuant to Section 11 of the Participation
Agreement or (d) any claim against the Lessor arising out of any transfer by the
Lessor of all or
Appendix A-25
179
any portion of the interest of the Lessor in the Properties, the Trust Estate or
the Operative Agreements other than the transfer of title to or possession of
any Properties by the Lessor pursuant to and in accordance with the Lease, the
Credit Agreement, the Security Agreement or the Participation Agreement or
pursuant to the exercise of the remedies set forth in Article XVII of the Lease.
"Lien" shall mean any mortgage, pledge, security interest, encumbrance,
lien, option or charge of any kind.
"Limited Recourse Amount" shall mean with respect to all the Properties
on an aggregate basis, an amount equal to the sum of the Termination Values with
respect to all the Properties on an aggregate basis on each Payment Date, less
the Maximum Residual Guarantee Amount as of such date with respect to all the
Properties on an aggregate basis.
"Loan Basic Rent" shall mean the interest due on the Loans on any
Scheduled Interest Payment Date pursuant to the Credit Agreement (but not
including interest on (a) any such Loan due prior to the Rent Commencement Date
with respect to the Property to which such Loan relates or (b) any overdue
amounts under Section 2.8(c) of the Credit Agreement or otherwise).
"Loan Property Cost" shall mean, with respect to each Property at any
date of determination, an amount equal to (a) the aggregate principal amount all
Loans (including without limitation all Acquisition Loans and Construction
Loans) made on or prior to such date with respect to such Property minus (b) the
aggregate amount of prepayments or repayments as the case may be of the Loans
allocated to reduce the Loan Property Cost of such Property pursuant to Section
2.6(c) of the Credit Agreement.
"Loans" shall mean the loans extended pursuant to the Credit Agreement
and shall include both the Tranche A Loans and the Tranche B Loans.
"Majority Holders" shall mean at any time, Holders whose Holder
Advances outstanding represent at least fifty-one percent (51%) of (a) the
aggregate Holder Advances outstanding or (b) to the extent there are no Holder
Advances outstanding, the aggregate Holder Commitments.
"Majority Lenders" shall mean at any time, Lenders whose Loans
outstanding represent at least fifty-one percent (51%) of (a) the aggregate
Loans outstanding or (b) to the extent there are no Loans outstanding, the
aggregate Lender Commitments.
"Majority Secured Parties" shall mean at any time, Lenders and Holders
whose Loans and Holder Advances outstanding represent at least fifty-one percent
(51%) of (a) the aggregate Advances outstanding or (b) to the extent there are
no Advances outstanding, the sum of the aggregate Holder Commitments plus the
aggregate Lender Commitments.
"Marketing Period" shall mean, if the Lessee has given a Sale Notice in
accordance with Section 20.1 of the Lease, the period commencing on the date
such Sale Notice is given and ending on a particular Payment Date or the
Expiration Date, as applicable.
Appendix A-26
180
"Material Adverse Effect" shall, mean a material adverse effect on (a)
the financial condition, operations, business, properties or prospects of the
Lessee and its Subsidiaries, taken as a whole; (b) the ability of the Lessee or
any of its Subsidiaries to perform its material obligations under any Material
Operative Agreement; (c) the legality, validity or enforceability of any
Material Operative Agreement; (d) the perfection or priority of the liens of the
Agent granted under the Material Operative Agreements or the rights and remedies
of the Agent or the other Financing Parties under the Material Operative
Agreements, or (e) the value, utility or useful life of any Property or the use,
or ability of the Lessee to use, any Property for the purpose for which it was
intended (provided, respecting this subsection (e), no Material Adverse Effect
shall result to the extent the applicable Property is purchased by the Lessee
pursuant to the Purchase Option or is sold to another Person pursuant to the
Sale Option, in each case (i) in accordance with Section 8(j) of the
Participation Agreement and Articles XIX, XX and XXII of the Lease and (ii)
within thirty (30) days of the Lessor having gained knowledge of such material
adverse effect described in this subsection (e)).
"Material Operative Agreements" shall mean the following: the
Participation Agreement, the Agency Agreement, the Trust Agreement, the
Certificates, the Credit Agreement, the Notes, the Lease, the Lease Supplements
(and memoranda of the Lease and each Lease Supplement in a form reasonably
acceptable to the Agent), the Joinder Agreements, the Security Agreement, the
Mortgage Instruments, the other Security Documents, the Ground Leases, the Deeds
and the Bills of Sale.
"Maturity Date" shall mean the Expiration Date.
"Maximum Residual Guarantee Amount" shall mean an amount equal to the
product of the aggregate Property Cost for all of Properties times eighty-five
percent (85%).
"Medicaid Regulations" shall mean, collectively, (i) all federal
statutes (whether set forth in Title XIX of the Social Security Act, 42 USC
▇▇.▇▇. 1396 et seq., or elsewhere) affecting the medical assistance program
established by Title XIX of the Social Security Act, and any statutes succeeding
thereto; (ii) all applicable provisions of all federal rules, regulations,
manuals and orders of all Governmental Authorities promulgated pursuant to or in
connection with the statutes described in clause (i) above and all federal
administrative, reimbursement and other guidelines of all Governmental
Authorities having the force of law promulgated pursuant to or in connection
with the statutes described in clause (i) above; (iii) all state statutes and
plans for medical assistance enacted in connection with the statutes and
provisions described in clauses (i) and (ii) above; and (iv) all applicable
provisions of all rules, regulations, manuals and orders of all Governmental
Authorities promulgated pursuant to or in connection with the statutes described
in clause (iii) above and all state administrative, reimbursement and other
guidelines of all Governmental Authorities having the force of law promulgated
pursuant to or in connection with the statutes described in clause (iii) above,
in each case as may be amended, supplemented or otherwise modified from time to
time.
Appendix A-27
181
"MediCal Regulations" shall mean collectively, all California state
statues (whether set forth in Cal. Welf. & Inst. Code ▇▇.▇▇. 14000 et seq., or
elsewhere) affecting the health insurance program for the aged and disabled
established in connection with Title XIX of the Social Security Act, and any
statutes succeeding thereto; together with all applicable provisions of all
rules, regulations, manuals and orders and administrative, reimbursement and
other guidelines having the force of law of all Governmental Authorities
(including without limitation, the California Department of Health Services)
promulgated pursuant to or in connection with any of the foregoing having the
force of law, in each case as may be amended, supplemented or otherwise modified
from to time.
"Medicare Regulations" shall mean, collectively, all federal statutes
(whether set forth in Title XVIII of the Social Security Act, 42 USC ▇▇.▇▇.
1396, et seq., or elsewhere) affecting the health insurance program of the aged
and disabled established by Title XVIII of the Social Security Act and any
statutes succeeding thereto; together with all applicable provisions of all
rules, regulations, manuals and orders and administrative, reimbursement and
other guidelines having the force of law of all Governmental Authorities
(including without limitation, Health and Human Services ("HHS"), HCFA, the
Office of the Inspector General for HHS, or any Person succeeding to the
functions of law, in each case as may be amended from time to time.
"Modifications" shall have the meaning specified in Section 11.1(a) of
the Lease.
"Mortgage Instrument" shall mean any mortgage, deed of trust or any
other instrument executed by the Owner Trustee and the Lessee (or regarding any
property subject to a Ground Lease, the applicable Affiliate of the Lessee) in
favor of the Agent (for the benefit of the Lenders and the Holders) and
evidencing a Lien on the Property, in form and substance reasonably acceptable
to the Agent.
"Multiemployer Plan" shall mean any plan described in Section
4001(a)(3) of ERISA to which contributions are or have been made or required by
any Credit Party or any of its Subsidiaries or ERISA Affiliates.
"Multiple Employer Plan" shall mean a plan to which any Credit Party or
any ERISA Affiliate and at least one (1) other employer other than an ERISA
Affiliate is making or accruing an obligation to make, or has made or accrued an
obligation to make, contributions.
"New Facility" shall have the meaning given to such term in Section
28.1 of the Lease.
"Non-Excluded Taxes" shall have the meaning given to such term in
Section 11.5 of the Participation Agreement.
"Notes" shall mean those notes issued to the Lenders pursuant to the
Credit Agreement and shall include both the Tranche A Notes and the Tranche B
Notes.
"Obligations" shall have the meaning given to such term in Section 1 of
the Security Agreement.
Appendix A-28
182
"OECD" shall mean the Organization for Economic Cooperation and
Development.
"Officer's Certificate" with respect to any person shall mean a
certificate executed on behalf of such person by a Responsible Officer who has
made or caused to be made such examination or investigation as is necessary to
enable such Responsible Officer to express an informed opinion with respect to
the subject matter of such Officer's Certificate.
"Operative Agreements" shall mean the following: the Participation
Agreement, the Agency Agreement, the Trust Agreement, the Certificates, the
Credit Agreement, the Notes, the Lease, the Lease Supplements (and memoranda of
the Lease and each Lease Supplement in a form reasonably acceptable to the
Agent), the Joinder Agreements, the Security Agreement, the Mortgage
Instruments, the other Security Documents, the Ground Leases, the Deeds, the
Bills of Sale and any and all other agreements, documents and instruments
executed from time to time in connection with any of the foregoing.
"Original Executed Counterpart" shall have the meaning given to such
term in Section 5 of EXHIBIT A to the Lease.
"Overdue Interest" shall mean any interest payable pursuant to Section
2.8(c) of the Credit Agreement.
"Overdue Rate" shall mean (a) with respect to the Loan Basic Rent, and
any other amount owed under or with respect to the Credit Agreement or the
Security Documents, the rate specified in Section 2.8(b) of the Credit
Agreement, (b) with respect to the Lessor Basic Rent, the Holder Yield and any
other amount owed under or with respect to the Trust Agreement, the Holder
Overdue Rate, and (c) with respect to any other amount, the amount referred to
in clause (y) of Section 2.8(b) of the Credit Agreement.
"Owner Trustee," "Borrower" or "Lessor" shall mean First Security Bank,
National Association, not individually, except as expressly stated in the
various Operative Agreements, but solely as the Owner Trustee under the PHC Real
Estate Trust 1998-1 and any successor or replacement and/or additional Owner
Trustee expressly permitted under the Operative Agreements.
"Participation Agreement" shall mean the Participation Agreement dated
on or about the Initial Closing Date, among the Lessee, the Owner Trustee, not
in its individual capacity except as expressly stated therein, the Holders, the
Lenders and the Agent.
"Payment Date" shall mean any Scheduled Interest Payment Date and any
date on which interest or Holder Yield in connection with a prepayment of
principal on the Loans or of the Holder Advances is due under the Credit
Agreement or the Trust Agreement.
Appendix A-29
183
"PBGC" shall mean the Pension Benefit Guaranty Corporation created by
Section 4002(a) of ERISA or any successor thereto.
"Pension Plan" shall mean a "pension plan", as such term is defined in
section 3(2) of ERISA, which is subject to title IV of ERISA (other than a
Multiemployer Plan), and to which any Credit Party or any ERISA Affiliate may
have any liability, including without limitation any liability by reason of
having been a substantial employer within the meaning of section 4063 of ERISA
at any time during the preceding five (5) years, or by reason of being deemed to
be a contributing sponsor under section 4069 of ERISA.
"Permitted Facility" shall mean a medical office or acute care facility
of the type and size customarily used and operated by the Lessee in its ordinary
course of business as of the Initial Closing Date or an improvement to any of
the foregoing.
"Permitted Liens" shall mean:
(a) the respective rights and interests of the parties to the
Operative Agreements as provided in the Operative Agreements;
(b) the rights of any sublessee or assignee under a sublease
or an assignment expressly permitted by the terms of the Lease for no
longer than the duration of the Lease;
(c) Liens for Taxes that either are not yet delinquent or are
being contested in accordance with the provisions of Section 13.1 of
the Lease;
(d) Liens arising by operation of law, materialmen's,
mechanics', workmen's, repairmen's, employees', carriers',
warehousemen's and other like Liens relating to the construction of the
Improvements or in connection with any Modifications or arising in the
ordinary course of business for amounts that either are not more than
thirty (30) days past due or are being diligently contested in good
faith by appropriate proceedings, so long as such proceedings satisfy
the conditions for the continuation of proceedings to contest Taxes set
forth in Section 13.1 of the Lease;
(e) Liens of any of the types referred to in clause (d) above
that have been bonded for not less than the full amount in dispute (or
as to which other security arrangements satisfactory to the Lessor and
the Agent have been made), which bonding (or arrangements) shall comply
with applicable Legal Requirements, and shall have effectively stayed
any execution or enforcement of such Liens;
(f) Liens arising out of judgments or awards with respect to
which appeals or other proceedings for review are being prosecuted in
good faith and for the payment of which adequate reserves have been
provided as required by GAAP or other appropriate provisions have been
made, so long as such proceedings have the effect of staying the
Appendix A-30
184
execution of such judgments or awards and satisfy the conditions for
the continuation of proceedings to contest Taxes set forth in Section
13.1 of the Lease;
(g) Liens in favor of municipalities to the extent agreed to
by the Lessor;
(h) Liens upon Lessee's Equipment leased under a Capital Lease
(including sale/leaseback transactions permitted by Section 6.17 of the
Lessee Credit Agreement) and placed upon such Lessee's Equipment at the
time of, or within sixty (60) days after, the commencement of the lease
thereof to secure the lease payments under such Capital Lease, provided
that any such lien (i) shall not encumber any Property or any other
property of the Lessee or any of its Subsidiaries and (ii) shall not
exceed the total of such lease payments; and
(i) Purchase money liens incurred or assumed in the purchase
of Lessee's Equipment permitted under Section 6.14 of the Lessee Credit
Agreement, provided that any such lien (i) attaches to such asset
concurrently with or within ten (10) days after the acquisition
thereof, (ii) shall not encumber any Property or any other property of
the Lessee or any of its Subsidiaries and (iii) shall not exceed the
purchase price of such asset.
"Person" shall mean any individual, corporation, partnership, joint
venture, association, joint stock company, trust, unincorporated organization,
governmental authority or any other entity.
"PHC" shall mean Province Healthcare Company, a Delaware corporation,
and its successors and permitted assigns.
"PHC Real Estate Trust 1998-1" shall mean the grantor trust created
pursuant to the terms and conditions of the Trust Agreement.
"Plans and Specifications" shall mean, with respect to Improvements,
the plans and specifications for such Improvements to be constructed or already
existing, as such Plans and Specifications may be amended, modified or
supplemented from time to time in accordance with the terms of the Operative
Agreements.
"Prime Lending Rate" shall have the meaning given to such term in the
definition of ABR.
"Property" shall mean, with respect to each Permitted Facility that is
(or is to be) acquired, constructed, renovated and/or modified pursuant to the
terms of the Operative Agreements, the Land and each item of Equipment and the
various Improvements, in each case located on such Land, including without
limitation each Construction Period Property, each Property subject to a Ground
Lease and each Property for which the Term has commenced.
Appendix A-31
185
"Property Acquisition Cost" shall mean the cost to the Lessor to
purchase a Property on a Property Closing Date.
"Property Closing Date" shall mean the date on which the Lessor
purchases a Property or, with respect to the first Advance, the date on which
the Lessor seeks reimbursement for Property previously purchased by the Lessor.
"Property Cost" shall mean with respect to a Property the aggregate
amount (and/or the various items and occurrences giving rise to such amounts) of
the Loan Property Cost plus the Holder Property Cost for such Property (as such
amounts shall be increased equally among all Properties respecting the Holder
Advances and the Loans extended from time to time to pay for the Transaction
Expenses, fees, expenses and other disbursements referenced in Sections 7.1(a)
and 7.1(b) of the Participation Agreement).
"Purchase Option" shall have the meaning given to such term in Section
20.1 of the Lease.
"Register" shall have the meaning given to such term in Section 9.7(c)
of the Credit Agreement.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System (or any successor), as the same may be modified and
supplemented and in effect from time to time.
"Release" shall mean any release, pumping, pouring, emptying,
injecting, escaping, leaching, dumping, seepage, spill, leak, flow, discharge,
disposal or emission of a Hazardous Substance.
"Rent" shall mean, collectively, the Basic Rent and the Supplemental
Rent, in each case payable under the Lease.
"Rent Commencement Date" shall mean, regarding each Property, the
Completion Date.
"Replaced Financing Party" shall have the meaning specified in Section
11.6 of the Participation Agreement.
"Replacement Effective Date" shall have the meaning specified in
Section 11.6 of the Participation Agreement.
"Replacement Financing Party" shall have the meaning specified in
Section 11.6 of the Participation Agreement.
"Reportable Event" shall have the meaning specified in ERISA.
Appendix A-32
186
"Requested Funds" shall mean any funds requested by the Lessee or the
Construction Agent, as applicable, in accordance with Section 5 of the
Participation Agreement.
"Requisition" shall have the meaning specified in Section 4.2 of the
Participation Agreement.
"Responsible Officer" shall mean the Chairman or Vice Chairman of the
Board of Directors, the Chairman or Vice Chairman of the Executive Committee of
the Board of Directors, the President, any Senior Vice President or Executive
Vice President, any Vice President, the Secretary, any Assistant Secretary, the
Treasurer, or any Assistant Treasurer, except that when used with respect to the
Trust Company or the Owner Trustee, "Responsible Officer" shall also include the
Cashier, any Assistant Cashier, any Trust Officer or Assistant Trust Officer,
the Controller and any Assistant Controller or any other officer of the Trust
Company or the Owner Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Sale Date" shall have the meaning given to such term in Section
20.3(a) of the Lease.
"Sale Notice" shall mean a notice given to the Lessor in connection
with the election by the Lessee of its Sale Option.
"Sale Option" shall have the meaning given to such term in Section 20.1
of the Lease.
"Sale Proceeds Shortfall" shall mean the amount by which the proceeds
of a sale described in Section 22.1 of the Lease are less than the Limited
Recourse Amount with respect to the Properties if it has been determined that
the Fair Market Sales Value of the Properties at the expiration of the term of
the Lease has been impaired by greater than expected wear and tear during the
Term of the Lease.
"Scheduled Interest Payment Date" shall mean (a) as to any Eurodollar
Loan or Eurodollar Holder Advance, the last day of the Interest Period
applicable to such Eurodollar Loan or Eurodollar Holder Advance, (b) as to any
ABR Loan or any ABR Holder Advance, the fifteenth day of each month and (c) as
to all Loans and Holder Advances, the date of any voluntary or involuntary
payment, prepayment, return or redemption, and the Maturity Date or the
Expiration Date, as the case may be.
"Secured Parties" shall have the meaning given to such term in the
Security Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"Security Agreement" shall mean the Security Agreement dated on or
about the Initial Closing Date between the Lessor and the Agent, for the benefit
of the Secured Parties.
Appendix A-33
187
"Security Documents" shall mean the collective reference to the
Security Agreement, the Mortgage Instruments, (to the extent the Lease is
construed as a security instrument) the Lease and all other security documents
hereafter delivered to the Agent granting a lien on any asset or assets of any
Person to secure the obligations and liabilities of the Lessor under the Credit
Agreement and/or under any of the other Credit Documents or to secure any
guarantee of any such obligations and liabilities.
"Soft Costs" shall mean all costs which are ordinarily and reasonably
incurred in relation to the acquisition, development, installation,
construction, improvement and testing of the Properties other than Hard Costs,
including without limitation structuring fees, administrative fees, legal fees,
upfront fees, fees and expenses related to appraisals, title examinations, title
insurance, document recordation, surveys, environmental site assessments,
geotechnical soil investigations and similar costs and professional fees
customarily associated with a real estate closing, the Lender Facility Fee, the
Holder Facility Fee, fees and expenses of the Owner Trustee payable or
reimbursable under the Operative Agreements and costs and expenses incurred
pursuant to Sections 7.3(a) and 7.3(b) of the Participation Agreement.
"Stock" shall mean all shares, options, interests or other equivalents
(howsoever designated) of or in a corporation, whether voting or nonvoting,
including, without limitation, common stock, warrants, preferred stock,
convertible debentures and all agreements, instruments and documents
convertible, in whole or in part, into any one or more or all of the foregoing.
"Subsidiary" shall mean any corporation of which more than fifty
percent (50%) of the outstanding Stock having ordinary voting power to elect a
majority of the board of directors, or other entity of which more than 50% of
the Interests or voting power, is at the time, directly or indirectly, owned by
any Person or one or more of its Subsidiaries (irrespective of whether, at the
time, the ownership interests or Stock of any other class or classes of such
entity or corporation shall have or might have voting power by reason of the
happening of any contingency). When used without reference to a parent, the term
"Subsidiary" shall be deemed to refer to a Subsidiary of the Lessee.
"Supplemental Amounts" shall have the meaning given to such term in
Section 9.18 of the Credit Agreement.
"Supplemental Rent" shall mean all amounts, liabilities and obligations
(other than Basic Rent) which the Lessee assumes or agrees to pay to the Lessor,
the Trust Company, the Holders, the Agent, the Lenders or any other Person under
the Lease or under any of the other Operative Agreements including without
limitation payments of the Termination Value and the Maximum Residual Guarantee
Amount and all indemnification amounts, liabilities and obligations.
"Swap Agreement" shall mean any and all interest rate swap agreements,
interest rate cap agreements, interest rate collar agreements, interest rate
insurance or other hedging arrangements and all other similar agreements or
arrangements between the Lessee and any Lender designed to protect against
fluctuations in interest rates.
Appendix A-34
188
"Taxes" shall have the meaning specified in the definition of
"Impositions".
"Term" shall have the meaning specified in Section 2.2 of the Lease.
"Termination Date" shall have the meaning specified in Section 16.2(a)
of the Lease.
"Termination Event" shall mean (a) with respect to any Pension Plan,
the occurrence of a Reportable Event or an event described in Section 4062(e) of
ERISA, (b) the withdrawal of any Credit Party or any ERISA Affiliate from a
Multiple Employer Plan during a plan year in which it was a substantial employer
(as such term is defined in Section 4001(a)(2) of ERISA), or the termination of
a Multiple Employer Plan, (c) the distribution of a notice of intent to
terminate a Plan or Multiemployer Plan pursuant to Section 4041(a)(2) or 4041A
of ERISA, (d) the institution of proceedings to terminate a Plan or
Multiemployer Plan by the PBGC under Section 4042 of ERISA, (e) any other event
or condition which might constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan or
Multiemployer Plan, or (f) the complete or partial withdrawal of any Credit
Party or any ERISA Affiliate from a Multiemployer Plan.
"Termination Notice" shall have the meaning specified in Section 16.1
of the Lease.
"Termination Value" shall mean the sum of (a) either (i) with respect
to all Properties, an amount equal to the aggregate outstanding Property Cost
for all the Properties, in each case as of the last occurring Payment Date, or
(ii) with respect to a particular Property, an amount equal to the product of
the Termination Value of all the Properties times a fraction, the numerator of
which is the Property Cost allocable to the particular Property in question and
the denominator of which is the aggregate Property Cost for all the Properties,
in each case as of the last occurring Payment Date, plus (b) respecting the
amounts described in each of the foregoing subclause (i) or (ii), as applicable,
any and all accrued and unpaid interest on the Loans and any and all accrued and
unpaid Holder Yield on the Holder Advances related to the applicable Property
Cost, plus (c) to the extent the same is not duplicative of the amounts payable
under clause (b) above, all other Rent and other amounts then due and payable or
accrued under the Agency Agreement, Lease and/or under any other Operative
Agreement (including without limitation amounts under Sections 11.1 and 11.2 of
the Participation Agreement and all costs and expenses referred to in clause
FIRST of Section 22.2 of the Lease).
"Tranche A Commitments" shall mean the obligation of the Tranche A
Lenders to make the Tranche A Loans to the Lessor in an aggregate principal
amount at any one (1) time outstanding not to exceed the aggregate of the
amounts set forth opposite each Tranche A Lender's name on Schedule 1.1 to the
Credit Agreement, as such amount may be reduced from time to time in accordance
with the provisions of the Operative Agreements; provided, no Tranche A Lender
shall be obligated to make Tranche A Loans in excess of such Tranche A Lender's
share of the Tranche A Commitments as set forth adjacent to such Tranche A
Lender's name on Schedule 1.1 to Credit Agreement.
Appendix A-35
189
"Tranche A Lenders" shall mean First Union National Bank and the
several banks and other financial institutions from time to time party to the
Credit Agreement that commit to make the Tranche A Loans.
"Tranche A Loans" shall mean the Loans made pursuant to the Tranche A
Commitment.
"Tranche A Note" shall have the meaning given to it in Section 2.2 of
the Credit Agreement.
"Tranche B Commitments" shall mean the obligation of the Tranche B
Lenders to make the Tranche B Loans to the Lessor in an aggregate principal
amount at any one (1) time outstanding not to exceed the aggregate of the
amounts set forth opposite each Tranche B Lender's name on Schedule 1.1 to the
Credit Agreement, as such amount may be reduced from time to time in accordance
with the provisions of the Operative Agreements; provided, no Tranche B Lender
shall be obligated to make Tranche B Loans in excess of such Tranche B Lender's
share of the Tranche B Commitments as set forth adjacent to such Tranche B
Lender's name on Schedule 1.1 to Credit Agreement.
"Tranche B Lenders" shall mean First Union National Bank and the
several banks and other financial institutions from time to time party to the
Credit Agreement that commit to make the Tranche B Loans.
"Tranche B Loan" shall mean the Loans made pursuant to the Tranche B
Commitment.
"Tranche B Note" shall have the meaning given to it in Section 2.2 of
the Credit Agreement.
"Transaction Expenses" shall mean all Soft Costs and all other costs
and expenses incurred in connection with the preparation, execution and delivery
of the Operative Agreements and the transactions contemplated by the Operative
Agreements including without limitation all costs and expenses described in
Section 7.1 of the Participation Agreement and the following:
(a) the reasonable fees, out-of-pocket expenses and
disbursements of counsel in negotiating the terms of the Operative
Agreements and the other transaction documents, preparing for the
closings under, and rendering opinions in connection with, such
transactions and in rendering other services customary for counsel
representing parties to transactions of the types involved in the
transactions contemplated by the Operative Agreements;
(b) the reasonable fees, out-of-pocket expenses and
disbursements of accountants for any Credit Party in connection with
the transaction contemplated by the Operative Agreements;
Appendix A-36
190
(c) any and all other reasonable fees, charges or other
amounts payable to the Lenders, the Agent, the Holders, the Owner
Trustee or any broker which arises under any of the Operative
Agreements;
(d) any other reasonable fee, out-of-pocket expenses,
disbursement or cost of any party to the Operative Agreements or any of
the other transaction documents; and
(e) any and all Taxes and fees incurred in recording or filing
any Operative Agreement or any other transaction document, any deed,
declaration, mortgage, security agreement, notice or financing
statement with any public office, registry or governmental agency in
connection with the transactions contemplated by the Operative
Agreement.
"Tribunal" shall mean any state, commonwealth, federal, foreign,
territorial, or other court or government body, subdivision agency, department,
commission, board, bureau or instrumentality of a governmental body.
"Trust" shall mean the PHC Real Estate Trust 1998-1.
"Trust Agreement" shall mean the Trust Agreement dated on or about the
Initial Closing Date between the Holders and the Owner Trustee.
"Trust Company" shall mean First Security Bank, National Association,
in its individual capacity, and any successor owner trustee under the Trust
Agreement in its individual capacity.
"Trust Estate" shall have the meaning specified in Section 2.2 of the
Trust Agreement.
"Type" shall mean, as to any Loan, whether it is an ABR Loan or a
Eurodollar Loan.
"UCC Financing Statements" shall mean collectively the Lender Financing
Statements and the Lessor Financing Statements.
"Unanimous Vote Matters" shall have the meaning given it in Section
12.5 of the Participation Agreement.
"Unfunded Amount" shall have the meaning specified in Section 3.2 of
the Agency Agreement.
"Unfunded Liability" shall mean, with respect to any Plan, at any time,
the amount (if any) by which (a) the present value of all benefits under such
Plan exceeds (b) the fair market value of all Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plan, but only to the extent that such excess represents a potential liability
of the Company or any member of the Controlled Group to the PBGC or such Plan
under Title IV of ERISA.
Appendix A-37
191
"Uniform Commercial Code" and "UCC" shall mean the Uniform Commercial
Code as in effect in any applicable jurisdiction.
"United States Bankruptcy Code" shall mean Title 11 of the United
States Code.
"Wholly-Owned Entity" shall mean a Person, with respect to which all of
the shares of capital stock or other ownership interest are owned by Province
Healthcare Company and/or one of its wholly-owned Subsidiaries or other
wholly-owned entities; provided, such Person shall have assets with a gross
value (determined in accordance with GAAP) in excess of $100,000.
"Work" shall mean the furnishing of labor, materials, components,
furniture, furnishings, fixtures, appliances, machinery, equipment, tools,
power, water, fuel, lubricants, supplies, goods and/or services with respect to
any Property.
"Year 2000" shall mean the calendar year beginning January 1, 2000 and
ending December 31, 2000.
