Exhibit 10.1
EXECUTION COPY
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CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT
Dated as of December 1, 2003
among
GENESIS HEALTHCARE CORPORATION
as Borrower
and
THE GUARANTORS REFERRED TO HEREIN
and
THE LENDERS REFERRED TO HEREIN
and
WACHOVIA CAPITAL MARKETS LLC
as Co-Lead Arranger and Joint Bookrunner
CITIGROUP GLOBAL MARKETS INC.
as Co-Lead Arranger and Joint Bookrunner
WACHOVIA BANK, NATIONAL ASSOCIATION
as Administrative Agent
CITICORP NORTH AMERICA, INC.
as Syndication Agent
and
GENERAL ELECTRIC CAPITAL CORPORATION
as Documentation Agent
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TABLE OF CONTENTS
Page
PARTIES..........................................................................................................1
INTRODUCTORY STATEMENT...........................................................................................1
1. DEFINITIONS.............................................................................................2
2. THE LOANS..............................................................................................30
SECTION 2.1 B Term Loans.....................................................................30
SECTION 2.2 Revolving Credit Loans...........................................................31
SECTION 2.3 Disbursement of Funds and Notice of Borrowing of Revolving Credit Loans..........31
SECTION 2.4 Swingline Loans..................................................................32
SECTION 2.5 Interest Rate Type of the Loans..................................................33
SECTION 2.6 Repayment; Evidence of Debt; Administration......................................34
SECTION 2.7 Interest.........................................................................35
SECTION 2.8 Revolving Credit Commitment Fees, Facility Fee and Other Fees....................35
SECTION 2.9 Termination and/or Reduction of the Total Revolving Credit Commitment............36
SECTION 2.10 Voluntary Prepayments............................................................36
SECTION 2.11 Mandatory Prepayments............................................................37
SECTION 2.12 Amortization.....................................................................39
SECTION 2.13 Default Interest; Alternate Rate of Interest.....................................39
SECTION 2.14 Continuation and Conversion of Loans.............................................40
SECTION 2.15 Reimbursement of Lenders.........................................................41
SECTION 2.16 Change in Circumstances..........................................................42
SECTION 2.17 Change in Legality...............................................................44
▇▇▇▇▇▇▇ ▇.▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Withholding........................................................45
SECTION 2.19 Interest Adjustments.............................................................47
SECTION 2.20 Manner of Payments...............................................................48
SECTION 2.21 Letters of Credit................................................................48
3. REPRESENTATIONS AND WARRANTIES OF CREDIT PARTIES.......................................................54
SECTION 3.1 Existence and Power..............................................................54
SECTION 3.2 Authority and No Violation.......................................................54
i
TABLE OF CONTENTS
(continued)
Page
SECTION 3.3 Governmental and Other Approval..................................................55
SECTION 3.4 Binding Agreements...............................................................56
SECTION 3.5 No Material Adverse Effect.......................................................56
SECTION 3.6 Financial Information............................................................57
SECTION 3.7 Credit Parties...................................................................57
SECTION 3.8 Patents, Trademarks, Copyrights and Other Rights.................................57
SECTION 3.9 Fictitious Names.................................................................58
SECTION 3.10 Title to Properties..............................................................58
SECTION 3.11 Book Value of Excluded Assets....................................................59
SECTION 3.12 Litigation; Judgments............................................................59
SECTION 3.13 Federal Reserve Regulations......................................................59
SECTION 3.14 Investment Company Act...........................................................60
SECTION 3.15 Taxes............................................................................60
SECTION 3.16 Compliance with ERISA............................................................60
SECTION 3.17 Agreements.......................................................................61
SECTION 3.18 Security Interest................................................................61
SECTION 3.19 Disclosure.......................................................................61
SECTION 3.20 Environmental Matters............................................................62
SECTION 3.21 Pledged Securities...............................................................63
SECTION 3.22 Compliance with Laws; Third Party Payor Arrangements.............................64
SECTION 3.23 Projected Financial Information..................................................64
SECTION 3.24 Real Property....................................................................64
SECTION 3.25 No Default.......................................................................65
SECTION 3.26 Labor Matters....................................................................65
SECTION 3.27 Organizational Documents.........................................................65
4. CONDITIONS TO THE EFFECTIVENESS OF THIS CREDIT AGREEMENT AND THE MAKING OF THE LOANS...................65
SECTION 4.1 Conditions Precedent to the Effectiveness of This Credit Agreement and
the Making of the Loans..........................................................65
SECTION 4.2 Conditions Precedent to Each Loan and each Letter of Credit......................69
ii
TABLE OF CONTENTS
(continued)
Page
5. AFFIRMATIVE COVENANTS..................................................................................70
SECTION 5.1 Financial Statements and Reports.................................................70
SECTION 5.2 Compliance with Laws.............................................................73
SECTION 5.3 Maintenance of Properties........................................................73
SECTION 5.4 Notice of Material Events........................................................73
SECTION 5.5 Insurance........................................................................74
SECTION 5.6 Books and Records................................................................75
SECTION 5.7 Observance of Material Agreements................................................76
SECTION 5.8 Taxes and Charges................................................................76
SECTION 5.9 Liens............................................................................76
SECTION 5.10 Further Assurances; Security Interests...........................................77
SECTION 5.11 Environmental Laws...............................................................77
SECTION 5.12 Subsidiaries.....................................................................78
SECTION 5.13 Lease Agreements.................................................................78
SECTION 5.14 After-Acquired Real Property Assets..............................................79
SECTION 5.15 Lender Meetings..................................................................79
SECTION 5.16 Use of Proceeds of Revolving Credit Loans........................................79
SECTION 5.17 Cash Management System...........................................................79
SECTION 5.18 ERISA Plan Compliance and Reports................................................79
6. NEGATIVE COVENANTS.....................................................................................80
SECTION 6.1 Limitations on Indebtedness and Disqualified Capital Stock.......................80
SECTION 6.2 Limitations on Liens.............................................................81
SECTION 6.3 Limitation on Guaranties.........................................................83
SECTION 6.4 Limitations on Investments.......................................................84
SECTION 6.5 Restricted Payments..............................................................85
SECTION 6.6 Intentionally Omitted............................................................85
SECTION 6.7 Merger, Sale of Assets, Purchases, etc...........................................85
SECTION 6.8 Places of Business; Change of Name...............................................88
SECTION 6.9 Limitations on Capital Expenditures..............................................88
SECTION 6.10 Maximum Total Leverage Ratio.....................................................89
SECTION 6.11 Maximum Senior Leverage Ratio....................................................89
iii
TABLE OF CONTENTS
(continued)
Page
SECTION 6.12 Minimum Consolidated Fixed Charge Coverage Ratio.................................90
SECTION 6.13 Minimum Consolidated Net Worth...................................................90
SECTION 6.14 Transactions with Affiliates.....................................................90
SECTION 6.15 Business Activities..............................................................90
SECTION 6.16 Intentionally Omitted............................................................90
SECTION 6.17 Receivables......................................................................90
SECTION 6.18 Intentionally Omitted............................................................90
SECTION 6.19 Changes to Material Agreements...................................................90
SECTION 6.20 ERISA Compliance.................................................................91
SECTION 6.21 Hazardous Materials..............................................................91
SECTION 6.22 Use of Proceeds of Loans.........................................................91
SECTION 6.23 Fiscal Year; Fiscal Quarter......................................................91
SECTION 6.24 Formation of Foreign Subsidiaries................................................91
SECTION 6.25 Limitation on Restrictive Agreements.............................................92
7. EVENTS OF DEFAULT......................................................................................92
8. GRANT OF SECURITY INTEREST; REMEDIES...................................................................95
SECTION 8.1 Security Interests...............................................................95
SECTION 8.2 Use of Collateral................................................................95
SECTION 8.3 Cash Management System...........................................................95
SECTION 8.4 Credit Parties to Hold in Trust..................................................96
SECTION 8.5 Collections, etc.................................................................96
SECTION 8.6 Possession, Sale of Collateral, etc..............................................97
SECTION 8.7 Application of Proceeds on Default...............................................98
SECTION 8.8 Power of Attorney................................................................98
SECTION 8.9 Financing Statements, Direct Payments............................................99
SECTION 8.10 Further Assurances...............................................................99
SECTION 8.11 Termination and Release..........................................................99
SECTION 8.12 Remedies Not Exclusive...........................................................99
SECTION 8.13 Continuation and Reinstatement..................................................100
iv
TABLE OF CONTENTS
(continued)
Page
9. GUARANTY..............................................................................................100
SECTION 9.1 Guaranty........................................................................100
SECTION 9.2 No Impairment of Guaranty, etc..................................................101
SECTION 9.3 Continuation and Reinstatement, etc.............................................101
SECTION 9.4 Limitation on Guaranteed Amount etc.............................................102
SECTION 9.5 Termination and Release.........................................................102
10. PLEDGE................................................................................................102
SECTION 10.1 Pledge..........................................................................102
SECTION 10.2 Covenant........................................................................103
SECTION 10.3 Registration in Nominee Name; Denominations.....................................103
SECTION 10.4 Voting Rights; Dividends; etc...................................................103
SECTION 10.5 Remedies Upon Default...........................................................104
SECTION 10.6 Application of Proceeds of Sale and Cash........................................105
SECTION 10.7 Effect of Certain Applicable Law................................................106
SECTION 10.8 Continuation and Reinstatement..................................................106
SECTION 10.9 Termination and Release.........................................................106
11. CASH COLLATERAL.......................................................................................107
SECTION 11.1 Cash Collateral Account.........................................................107
SECTION 11.2 Investment of Funds.............................................................107
SECTION 11.3 Grant of Security Interest......................................................107
SECTION 11.4 Remedies........................................................................108
12. THE AGENTS AND THE ISSUING BANK.......................................................................108
SECTION 12.1 Administration by the Administrative Agent......................................108
SECTION 12.2 Advances and Payments...........................................................109
SECTION 12.3 Sharing of Setoffs and Cash Collateral..........................................110
SECTION 12.4 Notice to the Lenders...........................................................110
SECTION 12.5 Liability of the Administrative Agent, the Co-Lead Arrangers and the
Issuing Bank....................................................................111
SECTION 12.6 Reimbursement and Indemnification...............................................112
SECTION 12.7 Rights of the Agents............................................................113
SECTION 12.8 Independent Investigation by Lenders............................................113
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TABLE OF CONTENTS
(continued)
Page
SECTION 12.9 Agreement of the Lenders........................................................113
SECTION 12.10 Notice of Transfer..............................................................113
SECTION 12.11 Relations Among Lenders.........................................................113
SECTION 12.12 Successor Agents................................................................113
SECTION 12.13 Tenant's Quiet Enjoyment........................................................114
SECTION 12.14 Lender Payments.................................................................114
13. MISCELLANEOUS.........................................................................................115
SECTION 13.1 Notices.........................................................................115
SECTION 13.2 Survival of Agreement, Representations and Warranties, etc......................116
SECTION 13.3 Successors and Assigns; Syndications; Loan Sales; Participations................116
SECTION 13.4 Expenses; Documentary Taxes.....................................................120
SECTION 13.5 Indemnity.......................................................................121
SECTION 13.6 CHOICE OF LAW...................................................................121
SECTION 13.7 WAIVER OF JURY TRIAL............................................................122
SECTION 13.8 WAIVER WITH RESPECT TO DAMAGES..................................................122
SECTION 13.9 No Waiver.......................................................................122
SECTION 13.10 Extension of Payment Date.......................................................123
SECTION 13.11 Amendments, etc.................................................................123
SECTION 13.12 Severability....................................................................124
SECTION 13.13 SERVICE OF PROCESS..............................................................124
SECTION 13.14 Headings........................................................................125
SECTION 13.15 Execution in Counterparts.......................................................125
SECTION 13.16 Subordination of Intercompany Indebtedness, Receivables and Advances............126
SECTION 13.17 Confidentiality.................................................................126
SECTION 13.18 Entire Agreement................................................................127
SECTION 13.19 Enforcement of Rights; No Obligation to ▇▇▇▇▇▇▇▇ Assets.........................127
SECTION 13.20 Reproduction of Documents.......................................................127
SECTION 13.21 Right of Set-Off................................................................128
SECTION 13.22 Consolidated Subsidiaries.......................................................128
vi
Schedules
---------
1.2 Excluded Assets
2.21 Existing Letters of Credit
3.1(a) List of jurisdictions where the Borrower is qualified/not in good standing
3.1(b) List of jurisdictions where each Credit Party is qualified/not in good standing
3.3(c) Governmental Approvals
3.7(a) Credit Parties Information
3.7(b) Capital Stock in Persons other than a Credit Party
3.8 Proprietary Rights
3.9 Fictitious Names
3.10(a) Title to Properties
3.10(d) Rights of First Refusal/Option Rights
3.12(a) Litigation
3.12(c) Investigations/Medicare-Medicaid Claims
3.15 Taxes
3.17(b) Agreements
3.18(a) Filing Offices for UCC-1 Financing Statements
3.18(b) Filing Offices for the Mortgages and Fixture Filings
3.20 Environmental Matters
3.21(a) Pledged Securities
3.21(c) Restrictions on Transfer of the Pledged Securities
3.24(a) Owned Real Property Assets
3.24(b) Leased Real Property Assets
3.26 Labor Matters
4.1(c) Local Counsel Opinions
6.1 Existing Indebtedness
6.2 Existing Liens
6.3 Certain Guaranties by Borrower
6.4 Existing Investments
8.3(b) Concentration Accounts
8.3(c) Government Concentration Accounts
vii
Exhibits
A Form of Assignment and Acceptance
B Form of Borrowing Certificate
C Form of Instrument of Assumption and Joinder
D Form of Mortgage
E Form of Note
F Form of Closing Certificate
G Form of Contribution Agreement
viii
CREDIT, SECURITY, GUARANTY AND PLEDGE
AGREEMENT, dated as of December 1, 2003 (as
this agreement may be further amended,
amended and restated, supplemented or
otherwise modified, renewed or replaced from
time to time, the "Credit Agreement"), among
(i) Genesis HealthCare Corporation, a
Pennsylvania corporation (the "Borrower");
(ii) the Guarantors referred to herein;
(iii) the Lenders referred to herein; (iv)
Wachovia Bank, National Association, as
Administrative Agent; (v) Wachovia Capital
Markets LLC., as Co-Lead Arranger and Joint
Bookrunner; (vi) Citicorp North America,
Inc., as Syndication Agent; (vii) Citigroup
Global Markets Inc., as Co-Lead Arranger and
Joint Bookrunner , and (viii) General
Electric Capital Corporation, as
Documentation Agent.
INTRODUCTORY STATEMENT
All terms not otherwise defined above or in this Introductory
Statement are as defined in Article 1 hereof or as defined elsewhere herein.
Subject to and upon the terms and conditions set forth herein,
the Lenders are willing to make available to the Borrower: (a) Revolving Credit
Loans in the amount of $75,000,000 and (b) the B Term Loans in the amount of
$185,000,000, and other financial accommodations provided for in this Credit
Agreement.
To provide assurance for the repayment of the Loans hereunder
and the other Obligations (as such term is hereinafter defined) of the Borrower
hereunder, the Borrower will, among other things, provide or cause to be
provided to the Administrative Agent, for the benefit of the Secured Parties,
the following (each as more fully described herein):
(i) a guaranty of the Obligations by each of the Guarantors pursuant to Article
9 hereof;
(ii) a security interest in the Collateral from each of the Credit Parties
pursuant to Article 8 hereof;
(iii) a pledge by each of the Pledgors of the Pledged Collateral owned by it
pursuant to Article 10 hereof; and
(iv) Mortgages with respect to certain Real Property Assets owned by the Credit
Parties.
Subject to the terms and conditions set forth herein, the
Administrative Agent is willing to act as administrative agent for the Lenders,
the Documentation Agent is willing to act as documentation agent for the
Lenders, the Syndication Agent is willing to act as syndication agent, the
Issuing Bank is willing to issue Letters of Credit as provided herein, and each
Lender is willing to make Loans and to participate in Letters of Credit to the
Borrower as provided herein, in an aggregate principal amount at any one time
outstanding not in excess of the Total Credit Commitments hereunder.
1
Accordingly, the parties hereto hereby agree as follows:
1. DEFINITIONS
For the purposes hereof unless the context otherwise requires,
all references to Sections, Exhibits and Schedules shall be deemed references to
Sections of, and Exhibits and Schedules to, this Credit Agreement, the following
terms shall have the meanings indicated, all accounting terms not otherwise
defined herein shall have the respective meanings accorded to them under GAAP
and all terms defined in the UCC and not otherwise defined herein shall have the
respective meanings accorded to them therein. Whenever the context may require,
any pronoun shall include the masculine, feminine and neuter forms. Unless the
context otherwise requires, any of the following terms may be used in the
singular or the plural, depending on the reference:
"Adjusted LIBO Rate" shall mean with respect to any Eurodollar
Loan for any Interest Period, the rate per annum equal to the quotient (rounded
upwards, if necessary, to the next 1/100 of 1%) of (i) the LIBO Rate for such
Eurodollar Loan for such Interest Period divided by (ii) one minus the
applicable statutory reserve requirements of the Administrative Agent, expressed
as a decimal (including without duplication or limitation, basic, supplemental,
marginal and emergency reserves), from time to time in effect under Regulation D
or similar regulations of the Board. It is agreed that for purposes of this
definition, Eurodollar Loans made hereunder shall be deemed to constitute
Eurocurrency Liabilities as defined in Regulation D and to be subject to the
reserve requirements of Regulation D (for so long as such requirements are in
effect).
"Administrative Agent" shall mean Wachovia Bank, National
Association, in its capacity as administrative agent for the Lenders hereunder
or such successor Administrative Agent as may be appointed pursuant to Section
12.12 hereof.
"Affiliate" shall mean with respect to any Person (including a
Credit Party), any other Person which, directly or indirectly, is in control of,
is controlled by, or is under common control with, such Person. For purposes of
this definition, a Person shall be deemed to be "controlled by" another Person
if such latter Person possesses, directly or indirectly, power either to (i)
vote fifteen percent (15%) or more of the securities or other ownership
interests having ordinary voting power for the election of directors (or the
equivalent) of such controlled Person or (ii) direct or cause the direction of
the management and policies of such controlled Person whether by contract or
otherwise.
"Affiliated Group" shall mean a group of Persons, each of
which is an Affiliate of some other Person in the group.
2
"Agents" shall mean collectively, the Administrative Agent,
the Documentation Agent and the Syndication Agent.
"Applicable Interest Margin" shall mean:
(i) (A) in the case of Base Rate Loans that are B Term
Loans 1.75% per annum, and (B) in the case of
Eurodollar Loans that are B Term Loans, 2.75% per
annum;
(ii) from the Closing Date until the date that is six
months thereafter, (A) in the case of Base Rate Loans
that are Revolving Credit Loans or Swingline Loans,
2.00% per annum and (B) in the case of Eurodollar
Loans that are Revolving Credit Loans, 3.00% per
annum; and
(iii) from and after the date that is six months after the
Closing Date, the Applicable Interest Margin for
Revolving Credit Loans and Swingline Loans shall be
determined in accordance with the following grid
(provided that all Swingline Loans shall be Base Rate
Loans as set forth in Section 2.5 hereof):
Eurodollar Loan
Base Rate Loan Applicable Interest
Total Leverage Ratio Applicable Interest Margin Margin
-------------------- -------------------------- -------------------
Greater than or equal to 4.0:1 2.00% 3.00%
Less than 4.0:1, but 1.75% 2.75%
Greater than or equal to 3.5:1
Less than 3.5:1, but 1.50% 2.50%
Greater than or equal to 3.0:1
Less than 3.0:1, but 1.25% 2.25%
Greater than or equal to 2. 5:1
Less than 2.5:1 1.00% 2.00%
"Applicable Law" shall mean all applicable provisions of
statutes, rules, regulations and orders of the United States, any state thereof
or municipality therein or of any foreign governmental body or of any regulatory
agency applicable to the Person in question, and all orders and decrees of all
courts and arbitrators in proceedings or actions in which the Person in question
is a party.
"Assignment and Acceptance" shall mean an agreement
substantially in the form of Exhibit A hereto, executed by the assignor, the
assignee and the other parties as contemplated hereby or thereby or any such
other form approved by the Administrative Agent.
3
"Authorized Officer" shall mean, with respect to the Borrower
or any other Credit Party, the president, vice president, chief financial
officer, chief accounting officer, secretary, treasurer or the general partner,
manager or member of such entity (or of the general partner, manager or member
of such entity, if not a natural person), as the case may be.
"B Term Loan" shall have the meaning given to such term in
Section 2.1 hereof.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of
1978, as heretofore and hereafter amended, as codified at 11 U.S.C. ss. 101 et
seq.
"Bankruptcy Court" shall mean the United States Bankruptcy
Court for the District of Delaware.
"Base Rate" shall mean, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Rate in effect for such day plus 1/2 of 1%. For purposes hereof, "Prime
Rate" shall mean the rate of interest per annum established from time to time by
the Administrative Agent as its prime rate, which rate may not be the lowest
rate of interest charged by the Administrative Agent to its customers. "Federal
Funds Rate" shall mean, for any day, the rate per annum (rounded upwards, if
necessary, to the next 1/100th of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers, on such day, as published on the next
succeeding Business Day by the Federal Reserve Bank of New York; provided, that
(i) if such day is not a Business Day, the Federal Funds Rate for such day shall
be such rate on such transactions on the next preceding Business Day as so
published on the next succeeding Business Day and (ii) if no such rate is so
published on such next succeeding Business Day, the Federal Funds Rate for such
day shall be the average rate quoted to the Administrative Agent on such day on
such transactions as determined by the Administrative Agent. If the
Administrative Agent shall have determined (which determination shall be
conclusive absent manifest error) that it is unable to ascertain the Federal
Funds Rate for any reason, including (without limitation) the inability or
failure of the Administrative Agent to obtain quotations in accordance with the
terms hereof, the Base Rate shall be determined without regard to clause (b) of
the first sentence of this definition until the circumstances giving rise to
such inability no longer exist. Any change in the Base Rate due to a change in
the Prime Rate or the Federal Funds Rate shall be effective on the effective
date of such change in the Prime Rate or the Federal Funds Rate, respectively.
"Base Rate Loan" shall mean a Loan based on the Base Rate in
accordance with the provisions of Article 2 hereof.
"Board" shall mean the Board of Governors of the Federal
Reserve System of the United States of America.
"Borrower" shall have the meaning given to such term in the
initial paragraph of this Credit Agreement.
"Borrowing" shall mean (i) a Loan or group of Loans of the
same Tranche and Interest Rate Type, made, converted or continued on the same
date and, in the case of Eurodollar Loans, as to which a single Interest Period
is in effect or (ii) a Swingline Loan.
4
"Borrowing Certificate" shall mean a borrowing certificate,
substantially in the form of Exhibit B hereto, to be delivered by the Borrower
to the Administrative Agent in connection with each Borrowing.
"Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banks are required or permitted to close in the
States of New York or North Carolina; 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 on the
London Interbank Market.
"Capital Expenditures" shall mean, with respect to any Person
for any period, the aggregate of all expenditures (whether paid in cash or
accrued as a liability) by such Person during that period which, in accordance
with GAAP, are or should be included in "additions to property, plant or
equipment" or similar items reflected in the statement of cash flows of such
Person (other than expenditures incurred in connection with any acquisition
permitted under Section 6.7 hereof).
"Capital Lease", as applied to any Person, shall mean any
lease of any property (whether real, personal or mixed) by that Person as lessee
which, in accordance with GAAP, is or should be accounted for as a capital lease
on the balance sheet of that Person.
"Capital Stock" shall mean (i) with respect to corporate
stock, any and all shares, interests, rights to purchase, warrants, options,
participations or other equivalents of or interests in (however designated)
corporate stock, including without limitation, any preferred stock or (ii) with
respect to any other evidence of beneficial ownership of any entity which is not
a corporation, any and all partnership interests or any other equity interests
or evidences of beneficial ownership, rights to purchase, warrants, options,
participations or other equivalents of or interests in (however designated) a
partnership interest or other equity interest or evidence of beneficial
ownership.
"Cash Collateral Account" shall have the meaning given to such
term in Section 11.1 hereof.
"Cash Equivalents" shall mean any of the following: (i) full
faith and credit obligations of the United States of America, or fully
guaranteed as to interest and principal by the full faith and credit of the
United States of America, maturing in not more than one year from the date such
investment is made; (ii) time deposits and certificates of deposit having a
final maturity of not more than one year after the date of issuance thereof of
any commercial bank or depository institution incorporated under the laws of the
United States of America or any state thereof or the District of Columbia, which
(i) in the case of a bank, is a member of the Federal Reserve System and (ii) in
the case of either a bank or a depository institution, has a combined capital
and surplus of not less than $1,000,000,000.00 and with a senior unsecured debt
credit rating of at least "A" by ▇▇▇▇▇'▇ or "A" by S&P; (iii) commercial paper
of companies, banks, trust companies or national banking associations
incorporated or doing business under the laws of the United States of America or
one of the States thereof, in each case having a remaining term until maturity
of not more than one hundred eighty (180) days from the date such investment is
made and rated at least P-1 by ▇▇▇▇▇'▇ or at least A-1 by S&P; (iv) repurchase
agreements with any financial institution having combined capital and surplus of
not less than $1,000,000,000.00 with a term of not more than seven (7) days for
underlying securities of the type referred to in clauses (i) and (ii) above; and
(v) money market funds which invest primarily in the Cash Equivalents set forth
in the preceding clauses (i) - (iv).
5
"CHAMPUS" shall mean, collectively, the Civilian Health and
Medical Program of the Uniformed Service, a program of medical benefits covering
former and active members of the uniformed services and certain of their
dependents, financed and administered by the United States Departments of
Defense, Health and Human Services and Transportation, and all laws, rules,
regulations, manuals, orders, guidelines or requirements pertaining to such
program including (a) all federal statutes (whether set forth in 10 U.S.C.
ss.ss.1071-1106 or elsewhere) affecting such program; and (b) all rules,
regulations (including 32 C.F.R. ss.199), manuals, orders and administrative,
reimbursement and other guidelines of all Governmental Authorities promulgated
in connection with such program (whether or not having the force of law), in
each case as the same may be amended, supplemented or otherwise modified from
time to time.
"CHAMPUS Receivable" shall mean a Receivable payable to a
Credit Party pursuant to CHAMPUS.
"CHAMPVA" shall mean, collectively, the Civilian Health and
Medical Program of the Department of Veteran Affairs, a program of medical
benefits covering retirees and dependents of former members of the armed
services administered by the United States Department of Veteran Affairs, and
all laws, rules, regulations, manuals, orders, guidelines or requirements
pertaining to such program including (a) all federal statutes (whether set forth
in 38 U.S.C. ss.1713 or elsewhere) affecting such program or, to the extent
applicable to CHAMPVA; and (b) all rules, regulations (including 38 C.F.R.
ss.17.54), manuals, orders and administrative, reimbursement and other
guidelines of all Governmental Authorities promulgated in connection with such
program (whether or not having the force of law), in each case as the same may
be amended, supplemented or otherwise modified from time to time.
"CHAMPVA Receivable" shall mean a Receivable payable to a
Credit Party pursuant to CHAMPVA.
"Change in Control" shall mean (i) any Person, Affiliated
Group or group (such term being used as defined in the Exchange Act), acquiring
ownership or control of in excess of 35% of equity securities having voting
power to vote in the election of the Board of Directors of the Borrower either
on a fully diluted basis or based solely on the voting stock then outstanding,
(ii) if at any time, individuals who at the date hereof (and after giving effect
to the additional appointments effective on or about the date hereof which are
described in the Information Statement) constituted the Board of Directors of
the Borrower (together with any new directors whose election by such Board of
Directors or whose nomination for election by the shareholders of the Borrower,
as the case may be, was approved by a vote of the majority of the directors then
still in office who were either directors at the date hereof or whose election
or nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors of the Borrower then in office,
(iii) the direct or indirect sale, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of the
Borrower to any Person or (iv) the adoption of a plan relating to the
liquidation or dissolution of the Borrower.
6
"Closing Date" shall mean the date on which the conditions
precedent set forth in Section 4.1 hereof have been satisfied or waived, but in
no event later than December 31, 2003.
"CMS" shall mean The Center for Medicare and Medicaid
Services, formerly known as the Health Care Financing Administration, the entity
within the United States Department of Health and Human Services responsible for
administering the Medicare program and the federal aspects of the Medicaid
programs, directly and through its fiscal intermediaries and agents.
"Co-Lead Arrangers" shall mean Wachovia Capital Markets LLC
and Citigroup Global Markets Inc. in their capacities as co-lead arrangers.
"Code" shall mean the Internal Revenue Code of 1986, as
heretofore and hereafter amended, as codified at 26 U.S.C. ss. 1 et seq., and
the applicable regulations promulgated thereunder, or any successor provision
thereto.
"Collateral" shall mean with respect to each Credit Party, all
of such Credit Party's right, title and interest in and to (i) all personal
property, tangible and intangible, wherever located or situated and whether now
owned, presently existing or hereafter acquired or created, including but not
limited to, all goods, accounts, health-care insurance receivables, instruments,
intercompany obligations, contract rights, partnership and joint venture
interests, interests in limited liability companies, documents, chattel paper,
electronic chattel paper, general intangibles, goodwill, equipment, machinery,
inventory, investment property, copyrights, trademarks, trade names, patents,
insurance proceeds, cash, deposit accounts, letter of credit rights, supporting
obligations, fixtures, Non-Government Receivables, Rights to Government
Receivables and the Pledged Securities, and any proceeds or products of, income
from, any of the foregoing, in any form, including, without limitation, any
claims against third parties for loss or damage to or destruction of any or all
of the foregoing; (ii) all Real Property Assets owned by a Credit Party, (iii)
all books, records, ledger cards, computer tapes and diskettes wherever located,
related to the Collateral described in clause (i), (ii) or (iv) of this
definition; and (iv) the Pledged Collateral; excluding all Excluded Assets.
"Commitments" shall mean the Term Loan B Commitments or the
Revolving Credit Commitments.
"Concentration Accounts" shall mean the concentration accounts
established by the Credit Parties for deposit of all collections on Receivables
other than Medicare Receivables as set forth on Schedule 8.3(b) hereto.
"Consolidated EBITDA" subject to Section 13.22 hereof, shall
mean, for any period, all as determined in accordance with GAAP, the
Consolidated Net Income (or net loss) of the Borrower and its Consolidated
Subsidiaries for such period, plus (a) the sum for such period for Borrower and
its Consolidated Subsidiaries determined on a consolidated basis of (i)
depreciation expense, (ii) amortization expense, (iii) other non-cash expenses,
(iv) provision for LIFO adjustment for inventory valuation, (v) net total
Federal, state and local income tax expenses, (vi) Consolidated Interest
Expense, (vii) extraordinary losses, and (viii) any non-recurring charge or
restructuring charge less (b) extraordinary gains for such period for Borrower
and its Consolidated Subsidiaries determined on a consolidated basis to the
extent included in the definition of Consolidated Net Income.
7
"Consolidated EBITDAR" subject to Section 13.22 hereof, shall
mean, for any period, Consolidated EBITDA for such period plus Consolidated
Rental Expense for such period, to the extent not already added back in the
computation of Consolidated EBITDA for such period, minus non-cash rental
obligations accrued during such period.
"Consolidated Fixed Charge Coverage Ratio" subject to Section
13.22 hereof, shall mean, at any date for which such ratio is to be determined,
the ratio of Consolidated EBITDAR for the Rolling Four Quarter period ended on
such date to the sum of the following for such period: (i) Consolidated Interest
Expense plus (ii) Consolidated Rental Expense plus (iii) scheduled principal
payments on all Indebtedness of the Borrower and its Consolidated Subsidiaries,
including, without limitation, any Indebtedness under any B Term Loans, the
ElderCare Subordinated Notes and any Mortgage Loans plus (iv) cash taxes paid;
provided, however that the Consolidated Fixed Charge Coverage Ratio for the
Rolling Four Quarter period ended (a) December 31, 2003, shall include the
amounts in clauses (i), (iii) and (iv) above for the most recent quarter
multiplied by 4; (b) March 31, 2004, shall include the amounts in clauses (i),
(iii) and (iv) above for the most recent two quarters multiplied by 2; and (c)
June 30, 2004, shall include the amounts in clauses (i), (iii) and (iv) above
for the most recent three quarters multiplied by 4/3; provided, further that for
purposes of clauses (i), (iii) and (iv) of this definition only, the quarter
ended December 31, 2003 shall be deemed to have begun on the Closing Date and
all amounts for such quarter shall be increased proportionally to the extent
they represent less than a full quarter.
"Consolidated Interest Expense" subject to Section 13.22
hereof, shall mean, for any period, the gross interest expense, whether paid or
accrued and expensed in accordance with GAAP (including the interest component
of Capital Lease obligations) of the Borrower and its Consolidated Subsidiaries
on a consolidated basis for such period, including, without limitation or
duplication, (i) interest expense in respect of the Loans and all other
outstanding Indebtedness, (ii) amortization of the discount or issuance cost of
any Indebtedness (including, without limitation, any original issue discount
attributable to any issuance of debt securities), (iii) commissions, discounts
and other fees and charges payable in connection with letters of credit, (iv)
net payments payable in connection with all Interest Rate Protection Agreements
(including amortization of any discount) except for payments required to cancel
part or all of any Interest Rate Protection Agreement in connection with the
Spin-off, and (v) any interest which is capitalized, all as determined in
accordance with GAAP; provided, however that Consolidated Interest Expense for
the Rolling Four Quarter period ended (a) December 31, 2003, shall be calculated
for the most recent quarter multiplied by 4; (b) March 31, 2004, shall be
calculated for the most recent two quarters multiplied by 2; and (c) June 30,
2004, shall be calculated for the most recent three quarters multiplied by 4/3;
provided, further that the quarter ended December 31, 2003 shall be deemed to
have begun on the Closing Date and all amounts for such quarter shall be
increased proportionally to the extent they represent less than a full quarter.
8
"Consolidated Net Income" subject to Section 13.22 hereof,
shall mean, for any period for which such amount is being determined, the net
income or loss of the Borrower and its Consolidated Subsidiaries during such
period determined on a consolidated basis for such period taken as a single
accounting period in accordance with GAAP; provided, that (i) there shall be
excluded (x) the income (or loss) of any Person (other than a Consolidated
Subsidiary) in which the Borrower or any of its Consolidated Subsidiaries has an
equity investment or comparable interest, except to the extent of the amount of
dividends or other distributions actually paid to the Borrower or any of its
Consolidated Subsidiaries by such Person during such period and (y) the income
of any Consolidated Subsidiary to the extent that the declaration or payment of
dividends or similar distributions by that Consolidated Subsidiary of its income
is not at the time permitted by operation of the terms of its charter or any
agreement, instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Consolidated Subsidiary; and (ii) there shall be
included or excluded (as applicable) on a Pro Forma Basis the income (or loss)
of any Person which becomes a Consolidated Subsidiary of the Borrower, is merged
into or consolidated with the Borrower or any of its Consolidated Subsidiaries
or assets are acquired or sold or otherwise disposed of by the Borrower or any
of its Consolidated Subsidiaries during such period. The definition of
Consolidated Net Income shall exclude the impact of the cumulative effect of any
change in accounting principles.
"Consolidated Net Working Assets" subject to Section 13.22
hereof, shall mean for any date for which it is to be determined, (i) the total
assets of the Borrower and its Consolidated Subsidiaries which may properly be
classified as current assets in accordance with GAAP (excluding cash and Cash
Equivalents), minus (ii) the total liabilities of the Borrower and its
Consolidated Subsidiaries which may properly be classified as current
liabilities in accordance with GAAP (excluding current maturities of all long
term Indebtedness), determined on a consolidated basis in accordance with GAAP.
"Consolidated Net Worth" subject to Section 13.22 hereof,
shall mean at any date of determination, the sum of the capital stock and
additional paid-in capital plus retained earnings (or minus accumulated deficit)
of the Borrower and its Consolidated Subsidiaries on a consolidated after-tax
basis determined in accordance with GAAP.
"Consolidated Rental Expense" subject to Section 13.22 hereof,
shall mean, for any period, the aggregate rental obligations of the Borrower and
its Consolidated Subsidiaries on a consolidated basis for such period payable in
cash in respect of any leases (other than Capital Leases) including, without
limitation, obligations for taxes, insurance, maintenance and similar costs
which the lessee is obligated to pay under the terms of such leases and which
are attributable to such leases for such period (whether such amounts are
accrued or paid during such period); provided, however, that Consolidated Rental
Expense (i) shall not include any one-time payments to ElderTrust contemplated
by the ElderTrust Agreement, and (ii) shall be adjusted on a pro forma basis to
give effect to the ElderTrust Transactions at the beginning of such period.
"Consolidated Subsidiaries" shall mean all Subsidiaries of a
Person which are required or permitted to be consolidated with such Person for
financial reporting purposes in accordance with GAAP.
9
Consolidated Tangible Assets" subject to Section 13.22 hereof,
shall mean, at any date of determination, (i) the consolidated total assets of
the Borrower and its Consolidated Subsidiaries in accordance with GAAP, minus
(ii) the amount of all unamortized debt discount, goodwill, and other intangible
assets of the Borrower and its Consolidated Subsidiaries to the extent reflected
in determining consolidated total assets in clause (i) above.
"Contribution Agreement" shall mean a contribution agreement
among the Credit Parties, substantially in the form of Exhibit G hereto, as such
agreement may be amended, amended and restated, supplemented or otherwise
modified, renewed or replaced from time to time.
"Credit Agreement" shall have the meaning given to such term
in the initial paragraph of this agreement.
"Credit Exposure" shall mean, without duplication, with
respect to any Lender, an amount equal to (i) the aggregate principal amount of
outstanding Loans owed to such Lender hereunder, plus (ii) such Lender's pro
rata share of any L/C Exposure (if applicable), plus (iii) the unused amount of
the Revolving Credit Commitment of such Lender then in effect.
"Credit Party" shall mean the Borrower and each of the
Guarantors.
"Debtor Relief Laws" shall mean the Bankruptcy Code and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief laws of the United States of America or other
applicable jurisdictions from time to time in effect affecting the rights of
creditors generally.
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of Default.
"Defaulting Lender" shall mean, at any time, any Lender which
shall not have theretofore made available to the Administrative Agent or the
Issuing Bank, as applicable, any amounts required to be made available by such
Lender hereunder or otherwise failed to pay any obligation owing by such Lender
pursuant to this Credit Agreement.
"Designated Non-Cash Consideration" shall mean the fair market
value of total consideration received by a Credit Party in connection with a
sale or disposition other than the amount of cash or Cash Equivalents received
in connection with the sale or disposition; provided, however, the total amount
of Designated Non-Cash Consideration which has not been sold for cash or
otherwise monetizied at any one time does not exceed $25,000,000, provided,
further, that all consideration that is so designated as Designated Non-Cash
Consideration is so designated pursuant to an officer's certificate, setting
forth the basis of such valuation and executed by the principal executive
officer and principal financial officer.
"Disqualified Capital Stock" shall mean Capital Stock of any
class or classes (however designated) that, by its terms (or by the terms of any
security into which it is convertible, or for which it is exchangeable, in each
case at the option of the holder of the Capital Stock), or upon the happening of
any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the holder of the
Capital Stock, in whole or in part, on or prior to the date that is 91 days
after the Term Loan B Maturity Date.
10
"Documentation Agent" shall mean General Electric Capital
Corporation in its capacity as documentation agent for the Lenders hereunder.
"Dollars" and "$" shall mean lawful money of the United States
of America.
"ElderCare Subordinated Notes" shall mean those certain notes
issued under the ElderCare Subordinated Note Indenture.
"ElderCare Subordinated Note Indenture" shall mean the
Indenture dated as of October 28, 2003 pursuant to which the Borrower has issued
$225,000,000 of its 8% unsecured Senior Subordinated Notes due 2013 and the
Guarantors have guaranteed such Notes.
"ElderTrust" shall mean ElderTrust, a Maryland real estate
investment trust.
"ElderTrust Agreements" shall mean that certain Master
Agreement dated September 11, 2003 between GHVI and ElderTrust Operating Limited
Partnership, and all agreements contemplated thereby.
"ElderTrust Transactions" shall mean the transactions
contemplated by the ElderTrust Agreements.
"Eligible Assignee" shall mean (i) any Lender, any Affiliate
of any Lender (which, for purposes of this definition, shall include any
investment or similar fund that is owned, managed or controlled by such Lender)
and any Related Fund (any two or more Related Funds being treated as a single
Eligible Assignee for all purposes hereof), and (ii) any commercial bank,
insurance company, investment or mutual fund or other entity that is an
"accredited investor" (as defined in Regulation D under the Securities Act) and
which extends credit, buys loans and is in the business of lending as one of its
businesses; provided, that no Affiliate of the Borrower shall be an Eligible
Assignee.
"Environment" shall mean any surface or subsurface water,
groundwater, water vapor, surface or subsurface land, air, fish, wildlife,
microorganisms and all other natural resources.
"Environmental Claim" shall mean any and all administrative or
judicial actions, suits, orders, claims, liens, notices, notices of violations,
investigations, complaints, requests for information, proceedings, or other
written communication, whether criminal or civil, pursuant to or relating to any
applicable Environmental Law by any Person (including, but not limited to, any
Governmental Authority, private person and citizens' group) based upon,
alleging, asserting, or claiming any actual or potential (i) violation of or
liability under any Environmental Law, (ii) violation of any Environmental
Permit, or (iii) liability for investigatory costs, cleanup costs, removal
costs, remedial costs, response costs, natural resource damages, damage,
property damage, personal injury, fines, or penalties arising out of, based on,
resulting from, or related to the presence, Release, or threatened Release into
the Environment, of any Hazardous Materials at any location, including, but not
limited to, any Premises or any location other than any Premises to which
Hazardous Materials or materials containing Hazardous Materials were sent for
handling, storage, treatment, or disposal.
11
"Environmental Clean-up Site" shall mean any location which is
listed or proposed for listing on the National Priorities List, the
Comprehensive Environmental Response, Compensation and Liability Information
System, or on any similar state list of sites requiring investigation or
cleanup, or which is the subject of any pending action, suit, proceeding, or
investigation related to or arising from any alleged violation of any
Environmental Law, or at which there has been a Release, or a threatened or
suspected Release of a Hazardous Material.
"Environmental Laws" shall mean any and all applicable
federal, state, local or municipal or foreign laws, rules, orders, regulations,
statutes, ordinances, codes, common law doctrines, decrees or requirements of
any Governmental Authority regulating, relating to, or imposing liability or
standards of conduct concerning, any Hazardous Material or environmental
protection or worker health and safety, as now or at any time hereafter in
effect, including without limitation, the Clean Water Act also known as the
Federal Water Pollution Control Act ("FWPCA"), 33 U.S.C. ss. 1251 et seq., the
Clean Air Act ("CAA"), 42 U.S.C. ▇▇.▇▇. 7401 et seq., the Federal Insecticide,
Fungicide and Rodenticide Act ("FIFRA"), 7 U.S.C. ▇▇.▇▇. 136 et seq., the
Surface Mining Control and Reclamation Act ("SMCRA"), 30 U.S.C. ▇▇.▇▇. 1201 et
seq., the Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA"), 42 U.S.C. ss. 9601 et seq., the Superfund Amendment and
Reauthorization Act of 1986 ("▇▇▇▇"), Public Law 99-499, 100 Stat. 1613, the
Emergency Planning and Community Right to Know Act ("ECPCRKA"), 42 U.S.C. ss.
11001 et seq., the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C.
ss. 6901 et seq., the Occupational Safety and Health Act as amended ("OSHA"), 29
U.S.C. ss. 655 and ss. 657, together, in each case, with any amendment thereto,
and the regulations adopted and the publications promulgated thereunder and all
substitutions thereof.
"Environmental Permit" shall mean any federal, state, local,
provincial, or foreign permits, licenses, approvals, consents or authorizations
required by any Governmental Authority under or in connection with any
Environmental Law and includes any and all orders, consent orders or binding
agreements issued or entered into by a Governmental Authority under any
applicable Environmental Law.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as heretofore and hereafter amended, as codified at 29 U.S.C. ss. 1001
et seq., and applicable regulations promulgated thereunder, or any successor
provision thereto.
"ERISA Affiliate" shall mean each Person (as defined in
Section 3(9) of ERISA) which is treated as a single employer with any Credit
Party under Section 414(b), (c), (m) or (o) of the Code.
"Eurodollar Loan" shall mean a Loan based on the LIBO Rate in
accordance with the provisions of Article 2 hereof.
"Event of Default" shall have the meaning given to such term
in Article 7 hereof.
12
"Excess Cash Flow" shall mean for any period for which it is
to be determined, the sum of (i) Consolidated Net Income, (ii) to the extent
Consolidated Net Income has been reduced thereby, amortization expense,
depreciation expense, and other non-cash expenses and (iii) the negative change,
if any, in Consolidated Net Working Assets during such period minus the sum of
(w) non-cash items increasing Consolidated Net Income, (x) principal repayments
by the Borrower or any of its Consolidated Subsidiaries on their Indebtedness,
including principal repayments on the Loans and the principal portion of
payments under Capital Leases (but exclusive of mandatory payments during the
period based upon the amount of Excess Cash Flow during prior periods, payments
made from the proceeds of any asset sales to the extent attributable to any
proceeds on such sales which were not included in Consolidated Net Income for
such period, insurance proceeds, new equity securities issued by the Borrower or
Indebtedness incurred by the Borrower or any of its Consolidated Subsidiaries
and any payments that can be reborrowed), (y) the net positive change, if any,
in Consolidated Net Working Assets during such period, and (z) Capital
Expenditures permitted hereunder, to the extent paid in cash from sources other
than secured purchase money financing, all as determined for such period in
conformity with GAAP and without any double-counting.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, including the rules and regulations promulgated thereunder.
"Excluded Assets" shall mean (without duplication): (i) all
assets listed on Schedule 1.2 hereto and any personal property located in or
appurtenant to the foregoing Excluded Assets (other than Receivables or other
intangibles related to such Excluded Assets so long as the grant of a security
interest in such Receivables or other intangibles is not prohibited or
restricted by Applicable Law or any contract, or agreement), (ii) any other
assets held for sale on the date of this Agreement or immediately upon the
acquisition thereof by the Borrower or any Credit Party, (iii) any other assets
related to any discontinued operations as designated by the Borrower as of the
date of this Agreement, (iv) equity interests in Joint Ventures to the extent
that a security interest therein is prohibited by contract, agreement or
Applicable Law, whether now held by a Credit party or hereafter acquired by a
Credit Party, (v) the Capital Stock of any Subsidiaries that are not organized
within the United States of America, whether now held by a Credit Party or
hereafter acquired by a Credit Party but, only to the extent that such Capital
Stock owned by the Credit Parties exceeds 65% of the outstanding Capital Stock
of any such Subsidiary, (vi) Capital Stock of any Subsidiary which is not a
Credit Party, to the extent that a security interest therein is prohibited by
contract, agreement or Applicable Law, (vii) assets subject to Liens permitted
by Section 6.2 to the extent that the agreement creating the permitted Liens
prohibits the creation of additional Liens on the same asset, and (ix) those
items listed on Schedule 3.21(a) under the heading "Non-Pledged Capital Stock".
"Facility Termination Date" shall mean the date on which all
of the Obligations have been indefeasibly paid in full in cash, the Total
Revolving Credit Commitment and the Total Term Loan B Commitment have been
permanently terminated in their entirety and all Letters of Credit shall have
expired or been terminated, canceled or cash collateralized in an amount equal
to 105% of the then current L/C Exposure.
"Federal Funds Rate" shall have the meaning given to such term
in the definition of "Base Rate" set forth in this Article 1.
13
"Federal Securities Laws" shall have the meaning given to such
term in Section 10.7 hereof.
"Fee Letter" shall mean that certain letter agreement, dated
as of October 14, 2003, between the Borrower and the Administrative Agent,
relating to the payment of certain fees, as the same may be amended, modified or
supplemented from time to time by a written instrument executed by the parties
thereto.
"Fees" shall mean all fees payable pursuant to the Fee Letter
and pursuant to the terms of this Credit Agreement.
"Fundamental Documents" shall mean this Credit Agreement, any
note issued to evidence any Loan hereunder, any Letter of Credit, any Mortgage,
the Contribution Agreement, UCC financing statements, the Fee Letter and any
other documentation which is required to be or is otherwise executed by any
Credit Party and delivered in connection with this Credit Agreement or any of
the documents listed above.
"GAAP" shall mean generally accepted accounting principles in
the United States of America as in effect from time to time, consistently
applied (except for accounting changes in response to FASB releases, or other
authoritative pronouncements); provided, however, that for purposes of
determining compliance with any covenant set forth in Article 6 hereof, GAAP
shall mean generally accepted accounting principles in the United States of
America as in effect on the Closing Date, applied on a basis consistent with the
application used in the financial statements referred to in Section 3.6 hereof.
"GHVI" shall mean Genesis Health Ventures, Inc., a
Pennsylvania corporation, which intends to change its name to NeighborCare Inc.
after the Spin-off.
"Governmental Authority" shall mean any federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, or any court, in each case whether of the United States or any
foreign jurisdiction.
"Government Receivables" shall mean, collectively, any and all
Receivables which are (a) Medicare Receivables, (b) Medicaid Receivables, (c)
TRICARE Receivables, (d) CHAMPVA Receivables, (e) CHAMPUS Receivables; or (f)
any other Receivables payable by a Governmental Authority and approved by the
Administrative Agent in its sole discretion.
"Guarantors" shall mean the guarantors signatory hereto as of
the date hereof and any other direct or indirect Subsidiary of a Credit Party
acquired or created after the date hereof, which Subsidiary becomes a signatory
to this Credit Agreement as a Guarantor pursuant to Section 5.12 hereof.
"Guaranty" shall mean, as to any Person, any direct or
indirect obligation of such Person guaranteeing or intending to guarantee, or
otherwise providing credit support, for any Indebtedness, Capital Lease,
dividend or other monetary obligation ("primary obligation") of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, by
contract, as a general partner or otherwise, including, without limitation, any
obligation of such Person, whether or not contingent, (a) to purchase any such
primary obligation or any property constituting direct or indirect security
therefor, (b) to advance or supply funds (i) for the purchase or payment of any
such primary obligation or (ii) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, or (c) to purchase property, securities or services from the
primary obligor or other Person, in each case, primarily for the purpose of
assuring the performance of the primary obligor of any such primary obligation
or assuring the owner of any such primary obligation of the repayment of such
primary obligation. The amount of any Guaranty shall be deemed to be an amount
equal to (x) the stated or determinable amount of the primary obligation in
respect of which such Guaranty is made (or, if the amount of such primary
obligation is not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder)) or (y) the stated maximum liability under such Guaranty, whichever
is less.
14
"Hazardous Materials" shall mean any chemicals, materials,
substances or wastes in any amount or concentration which are now or hereafter
become defined as or included in the definition of "hazardous substances,"
"hazardous materials," "hazardous wastes," "extremely hazardous wastes,"
"restricted hazardous wastes," "toxic substances," "toxic pollutants,"
"pollutants," "regulated substances," "solid wastes," or "contaminants" or words
of similar import, under any Environmental Law, including petroleum, petroleum
hydrocarbons or petroleum products, petroleum by-products, radioactive
materials, asbestos or asbestos-containing materials, gasoline, diesel fuel,
pesticides, radon, urea formaldehyde, lead or lead-containing materials,
polychlorinated biphenyls.
"Hedging Agreements" shall mean any Interest Rate Protection
Agreement entered into from time to time among a Lender and the Borrower as
permitted by this Credit Agreement; provided, that the Administrative Agent
shall have received written notice thereof from such Lender within ten (10)
Business Days after execution of such Interest Rate Protection Agreement.
"Hedging Banks" shall mean any Lender or Lenders which have
entered into a Hedging Agreement.
"Hedging Obligations" shall mean all the obligations of the
Borrower to Hedging Banks under the Hedging Agreements.
"Indebtedness" shall mean (without double counting), at any
time and with respect to any Person, (i) indebtedness of such Person for
borrowed money (whether by loan or the issuance and sale of debt securities) or
for the deferred purchase price of property or services purchased (other than
amounts constituting trade payables arising in the ordinary course of business
and payable in accordance with customary trading terms not in excess of 90
days); (ii) all indebtedness of such Person evidenced by a note, bond, debenture
or similar instrument (whether or not disbursed in full in the case of a
construction loan); (iii) indebtedness of others which such Person has directly
or indirectly assumed or guaranteed or otherwise provided credit support
therefor; (iv) indebtedness of others secured by a Lien on assets of such
Person, whether or not such Person shall have assumed such indebtedness
(provided, that if such Person has not assumed such indebtedness of another
Person then the amount of indebtedness of such Person pursuant to this clause
(iv) for purposes of this Credit Agreement shall be equal to the lesser of the
amount of the indebtedness of the other Person or the fair market value of the
assets of such Person which secures such other indebtedness); (v) obligations of
such Person in respect of letters of credit, acceptance facilities, or drafts or
similar instruments issued or accepted by banks and other financial institutions
for the account of such Person; (vi) any Guaranty by such Person; (vii)
obligations of such Person under Capital Leases; (viii) all obligations of such
Person under any Interest Rate Protection Agreement; and (ix) deferred payment
obligations of such Person resulting from the adjudication or settlement of any
litigation.
15
"Information Statement" shall mean the Borrower's Information
Statement dated November 14, 2003 as filed with the SEC as an exhibit to
Amendment No. 2 to the Borrower's Form 10.
"Initial Date" shall mean (i) in the case of the
Administrative Agent, the Documentation Agent, the Syndication Agent and the
Issuing Bank, the Closing Date, (ii) in the case of each Lender which is an
original party to this Credit Agreement, the Closing Date and (iii) in the case
of any other Lender, the effective date of the Assignment and Acceptance
pursuant to which it became a Lender.
"Instrument of Assumption and Joinder" shall mean an
Assumption and Joinder Agreement substantially in the form of Exhibit C hereto.
"Interest Deficit" shall have the meaning given to such term
in Section 2.19 hereof.
"Interest Payment Date" shall mean (i) as to any Base Rate
Loan (other than a Swingline Loan), the last Business Day of each March, June,
September and December (commencing the last Business Day of December 2003), (ii)
with respect to any Swingline Loan, the day that such loan is required to be
paid, and (iii) as to any Eurodollar Loan the last day of the applicable
Interest Period; provided, that in the case of an Interest Period with a
duration in excess of three (3) months an Interest Payment Date shall occur on
each date occurring at three (3) month intervals after the first day of such
Interest Period.
"Interest Period" shall mean as to any Eurodollar Loan, the
period commencing on the date such Loan is made, continued or converted or the
last day of the preceding Interest Period and ending on the numerically
corresponding day (or if there is no corresponding day, then the last day) in
the calendar month that is one, two, three or six months thereafter as the
Borrower may elect; provided, however, that (i) if any Interest Period would end
on a day which shall not be a Business Day, such Interest Period shall be
extended to the next succeeding Business Day, unless such next succeeding
Business Day would fall in the next calendar month, in which case, such Interest
Period shall end on the next preceding Business Day, (ii) no Interest Period
with respect to a B Term Loan or a Revolving Credit Loan (in each case
constituting a Eurodollar Loan) may be selected which would end later than the
Term Loan B Maturity Date or the Revolving Credit Commitment Termination Date,
respectively, (iii) interest shall accrue from and including the first day of
such Interest Period to but excluding the last date of such Interest Period and
(iv) no Interest Period with respect to any portion of the B Term Loans
constituting a Eurodollar Loan may be selected which extends beyond the date
under which a mandatory repayment of such Tranche will be required to be made
under Section 2.12 hereof if the aggregate principal amount of Eurodollar Loans
which are B Term Loans, which have Interest Periods ending after such date, will
be in excess of the aggregate principal amount of the B Term Loans outstanding
less the aggregate amount of such mandatory prepayment on the Tranche.
16
"Interest Rate Protection Agreement" shall mean any interest
rate swap agreement, interest rate cap agreement, synthetic cap, collar or floor
or other financial agreement or arrangement designed to protect a Credit Party
against fluctuations in interest rates or to reduce the effect of any such
fluctuations.
"Interest Rate Type" shall have the meaning given to such term
in Section 2.5 hereof.
"Investment" shall mean any stock, evidence of indebtedness or
other security of any Person, any loan, advance, contribution of capital,
extension of credit or commitment therefor (including, without limitation, the
Guaranty of loans made to others, but excluding current trade and customer
accounts receivable arising in the ordinary course of business and payable in
accordance with customary trading terms in the ordinary course of business or
periodic payments made pursuant to settlements for satisfaction of outstanding
Receivables entered into in the ordinary course of business), and any purchase
of (i) any security of another Person or (ii) a line of business, or all or
substantially all of the assets, of any Person or any binding commitment to make
any such purchase which by its terms is not conditioned upon receiving a consent
or waiver from the Lenders under the Credit Agreement.
"Issuing Bank" shall mean Wachovia Bank, National Association
or any other Revolving Credit Lender which agrees to serve as issuer of Letters
of Credit hereunder.
"JCAHO" shall mean the Joint Commission on Accreditation of
Healthcare Organizations.
"Joint Venture" shall mean any Person (other than a wholly
owned Subsidiary of a Credit Party) in which an equity interest is, at the time
any determination is being made, owned or controlled by a Credit Party as
permitted by this Credit Agreement.
"L/C Exposure" shall mean, at any time, the amount expressed
in Dollars of the aggregate face amount of all drafts which may then or
thereafter be presented by beneficiaries under all Letters of Credit then
outstanding plus (without duplication), the face amount of all drafts which have
been presented or accepted under all Letters of Credit but have not yet been
paid or have been paid but not reimbursed, whether directly or from the proceeds
of a Revolving Credit Loan hereunder.
"Lender" and "Lenders" shall mean the financial institutions
whose names appear on the signature pages hereof and any assignee of a Lender
pursuant to Section 13.3 hereof, and their respective successors. Unless the
context otherwise requires, the term "Lender" includes the Swingline Lender.
"Lending Office" shall mean, with respect to any of the
Lenders, the branch or branches (or Affiliate or Affiliates) from which such
Lender's Eurodollar Loans or Base Rate Loans, as the case may be, are made or
maintained and for the account of which all payments of principal of, and
interest on, such Lender's Eurodollar Loans or Base Rate Loans are made, as
notified to the Administrative Agent from time to time.
17
"Letter of Credit" shall mean a standby letter of credit
issued by the Issuing Bank pursuant to Section 2.21 hereof.
"Letter of Credit Fees" shall mean the fees payable in respect
of Letters of Credit pursuant to Section 2.21 hereof.
"LIBO Rate" shall mean, with respect to any Borrowing
consisting of Eurodollar Loans for any Interest Period, the rate per annum
(rounded upwards, if necessary, to the next 1/100 of 1%) appearing on Telerate
Page 3750 (or on any successor page) as the London interbank offered rate for
deposits in dollars at approximately 11:00 a.m. (London time) two (2) Business
Days prior to the commencement of such Interest Period with a maturity
comparable to such Interest Period. In the event that such rate is not available
at such time for any reason, then the "LIBO Rate" with respect to such Borrowing
of Eurodollar Loans for such Interest Period shall be the rate per annum at
which, as determined by the Administrative Agent, dollars in an amount
comparable to the amount of such Borrowing are being offered to leading banks at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the
commencement of the applicable Interest Period for settlement in immediately
available funds by leading banks in the London interbank market for a period
equal to the Interest Period selected.
"Lien" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
agreement to grant a security interest at a future date, any lease in the nature
of security, and the filing of, or agreement to give, any financing statement
under the Uniform Commercial Code of any jurisdiction).
"Loans" shall mean, collectively, the B Term Loans, the
Swingline Loans and the Revolving Credit Loans. A "Loan" shall mean any one of
such Loans individually.
"LTM EBITDA" shall mean as of the date of determination
thereof with respect to any Swapped Asset or Real Property Asset exchanged for a
Swapped Asset, unadjusted EBITDA for the prior twelve fiscal months calculated
solely for such Swapped Asset or Real Property Asset in accordance with GAAP.
"Margin Stock" shall be as defined in Regulation U of the
Board.
"Material Adverse Effect" shall mean any event or condition
that (i) has a material adverse effect on the business, assets, properties,
performance, operations or condition (financial or otherwise) or prospects of
the Credit Parties taken as a whole or of the Borrower except any such effect or
condition resulting solely from or arising solely in connection with any event
or action in connection the Spin-off as disclosed in the Information Statement,
(ii) materially impairs the ability of the Borrower or any Credit Party to
perform its respective obligations under any Fundamental Document to which it is
or will be a party or (iii) materially and adversely affects the Liens taken as
a whole granted to the Administrative Agent (for the benefit of Secured Parties)
or materially impairs the validity or enforceability of, or materially impairs
the rights, remedies or benefits available to the Administrative Agent or the
Secured Parties; provided, however, that any event or condition will be deemed
to have a "Material Adverse Effect" if such event or condition when taken
together with all other events and conditions occurring or in existence at such
time (including all other events and conditions which, but for the fact that a
representation, warranty or covenant is subject to a "Material Adverse Effect"
exception, would cause such representation or warranty contained herein to be
untrue or such covenant to be breached) would result in a "Material Adverse
Effect," even though, individually, such event or condition would not do so.
18
"Material Agreement" shall mean (i) any credit agreement,
indenture, or other agreement related to indebtedness of any Credit Party for
borrowed money in excess of $50,000,000 (other than this Credit Agreement and
the other Fundamental Documents); (ii) any agreement pursuant to which the
Credit Parties would reasonably expect to (A) recognize aggregate annual future
revenues in excess of 5% of the aggregate annual revenues of the Credit Parties
for the preceding fiscal year, or (B) incur aggregate annual future expenses in
excess of 5% of the aggregate annual revenues of the Credit Parties for the
preceding fiscal year; and (iii) any other agreement, the breach or termination
of which would reasonably be expected to have a Material Adverse Effect.
"Medicaid" shall mean collectively, the healthcare assistance
program established by Title XIX of the Social Security Act (42 U.S.C.
ss.ss.1396 et seq.) and any statutes succeeding thereto, and all laws, rules,
regulations, manuals, orders, guidelines or requirements pertaining to such
program including (a) all federal statutes (whether set forth in Title XIX of
the Social Security Act or elsewhere) affecting such program; (b) all state
statutes and plans for medical assistance enacted in connection with such
program and federal rules and regulations promulgated in connection with such
program; and (c) all applicable provisions of all rules, regulations, manuals,
orders and administrative, reimbursement, guidelines and requirements of all
Governmental Authorities promulgated in connection with such program (whether or
not having the force of law), in each case as the same may be amended,
supplemented or otherwise modified from time to time.
"Medicaid Receivable" shall mean a Receivable payable to a
Credit Party (i) pursuant to a Medicaid Provider Agreement or (ii) pursuant to
an assignment to such Credit Party under a Medicaid Provider Agreement.
"Medicaid Provider Agreement" shall mean an agreement entered
into between a health care facility, supplier or physician and CMS or any
federal or state agency or other entity administering Medicaid in such state, or
any other grant of authority by CMS or any federal or state agency or other
entity administering Medicaid in such state, under which the health care
facility, supplier or physician is authorized to provide medical goods and
services to Medicaid recipients and to be reimbursed by Medicaid for such goods
and services.
"Medicare" shall mean collectively, the health insurance
program for the aged and disabled established by Title XVIII of the Social
Security Act (42 U.S.C. ss.ss.1395 et seq.) and any statutes succeeding thereto,
and all laws, rules, regulations, manuals, orders or guidelines pertaining to
such program including (a) all federal statutes (whether set forth in Title
XVIII of the Social Security Act or elsewhere) affecting such program; and (b)
all applicable provisions of all rules, regulations, manuals, orders and
administrative, reimbursement, guidelines and requirements of all Governmental
Authorities promulgated in connection with such program (whether or not having
the force of law), in each case as the same may be amended, supplemented or
otherwise modified from time to time.
19
"Medicare Receivable" shall mean a Receivable payable to a
Credit Party (i) pursuant to a Medicare Provider Agreement or (ii) pursuant to
an assignment to such Credit Party under a Medicare Provider Agreement.
"Medicare Receivable Concentration Accounts" shall mean
concentration accounts established by the Credit Parties for the deposit of all
collections on Medicare Receivables as set forth on Schedule 8.3(c) hereto.
"Medicare Provider Agreement" shall mean an agreement entered
into between a health care facility, supplier or physician and CMS or any
federal or state agency or other entity administering Medicare in such state, or
other grant of authority by CMS or any federal or state agency or other entity
administering Medicare in such state, under which the health care facility,
supplier or physician is authorized to provide medical goods and services to
Medicare patients and to be reimbursed by Medicare for such goods and services.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc. or if
such company shall cease to issue ratings, another nationally recognized
statistical rating company selected in good faith by mutual agreement of the
Administrative Agent and the Borrower.
"Mortgage" shall mean a Mortgage, Open End Mortgage, Deed of
Trust, Trust Deed, Deed to Secure Debt, Credit Line Deed of Trust, Assignment,
Security Agreement and Financing Statement, substantially in the form of Exhibit
D hereto, executed and delivered by any Credit Party to the Administrative Agent
(for the benefit of the Secured Parties) and in each case, as such document may
be amended, amended and restated, supplemented or otherwise modified, renewed or
replaced from time to time.
"Mortgage Loan" shall mean a loan made to a Credit Party for
which the primary collateral is a Real Property Asset of such Credit Party.
"Multiemployer Plan" shall mean a plan described in Section
4001(a)(3) of ERISA to which any Credit Party or ERISA Affiliate is making or
accruing an obligation to make contributions, or otherwise pursuant to which any
Credit Party could have liability.
"Net Cash Proceeds" shall mean (a) the aggregate cash proceeds
received by a Credit Party in a transaction permitted under Section 6.7(a)(iv)
hereof (including, without limitation, as applicable, all cash proceeds received
by way of deferred payment of principal pursuant to a note or installment
receivable, sale or monetization of other non-cash consideration or otherwise,
but only as and when received) and minus (b) reasonable and customary brokerage
commissions and other reasonable and customary fees and direct expenses
(including reasonable and customary fees and expenses of counsel and investment
bankers actually paid by the applicable Credit Party) related to such
transaction, minus, and (c) payments made to retire Indebtedness (other than the
Loans) secured by any assets being sold or otherwise disposed of where payment
of such Indebtedness is required in connection with such sale or disposition;
provided, that with respect to taxes, expenses shall only include taxes to the
extent that taxes are payable in cash in the current year or in the next
succeeding year with respect to the current year as a direct result of the
applicable transaction.
20
"Net Offering Proceeds" shall mean all cash received by the
Borrower as a result of the sale of any Capital Stock (other than cash received
upon the exercise of stock options) or issuance of any Subordinated Debt, minus
customary costs and discounts of issuance paid by the Borrower.
"Non-Government Receivables" shall mean with respect to each
Credit Party, the Receivables of such Credit Party, other than Government
Receivables, together with any and all rights to receive payments due thereon,
and all proceeds thereof in any way derived, whether directly or indirectly.
"Obligations" shall mean (a) all obligations, whether direct
or indirect, contingent or absolute, of every type or description and at any
time existing, of the Borrower to make due and punctual payment of (i) principal
of and all interest on the Loans, the Fees, the Letter of Credit Fees, any
reimbursement obligations in respect of Letters of Credit, costs and attorneys'
fees and all other monetary obligations of the Borrower to the Agents, the
Issuing Bank, any Lender or any other Secured Party under or in respect of this
Credit Agreement, any note evidencing any of the Loans hereunder, any other
Fundamental Document or the Fee Letter, (ii) all Hedging Obligations and (iii)
amounts payable to Wachovia Bank, National Association or any Lender in
connection with any bank account maintained by the Borrower or any other Credit
Party at Wachovia Bank, National Association or any Lender or any other banking
services (including, without limitation, cash management services) provided to
the Borrower or any other Credit Party by Wachovia Bank, National Association or
any Lender with respect to, or in any way related to or otherwise required by,
any of the Fundamental Documents (including, without limitation, interest
accruing at the then applicable rate provided in this Credit Agreement after the
maturity of any of the Loans, and interest accruing at the then applicable rate
provided in this Credit Agreement after the filing of any petition in bankruptcy
or the commencement of any insolvency, reorganization or like proceeding,
relating to the Borrower or any other Credit Party, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding) and (b) all
other obligations of the Borrower or any other Credit Party pursuant to this
Credit Agreement or any other Fundamental Document.
"Opt-Out Lender" shall have the meaning given to such term in
Section 2.11(h) hereof.
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any successor thereto.
"Percentage" shall mean with respect to any Lender, the
percentage of the Total Credit Exposure represented by such Lender's Credit
Exposure, or the percentage of the specified Commitments or Tranche of Loans
held by such Lender, as the context may require.
21
"Permitted Acquisition" means any acquisition, whether by
purchase, merger, consolidation or otherwise, by the Borrower or any Credit
Party of all or substantially all the assets of, or all the equity interests in,
a Person or a division, line of business or other business unit of a Person or
the purchase of the remaining equity interests in a Joint Venture, so long as
(a) such acquisition shall not have been preceded by a tender offer that has not
been approved or otherwise recommended by the board of directors of such Person,
(b) such assets are to be used in, or such Person so acquired is engaged in, as
the case may be, a business of the type conducted by Borrower or its
Subsidiaries on the Closing Date or in a business reasonably related thereto,
(c) immediately after giving effect thereto, (i) no Default or Event of Default
has occurred and is continuing or would result therefrom, (ii) all transactions
related thereto are consummated in all material respects in accordance with
Applicable Laws, (iii) all the equity interests of each Subsidiary formed for
the purpose of or resulting from such acquisition shall be owned directly by the
Borrower or a Credit Party and all actions required to be taken under Sections
5.10, 5.12 and 5.14 shall have been taken, (iv) the Borrower and the Credit
Parties are in compliance, on a pro forma basis after giving effect to such
acquisition, with the covenants contained in Sections 6.9 through 6.13
recomputed as at the date of the last ended Rolling Four Quarters, as if such
acquisition (and any related incurrence or repayment of Indebtedness) had
occurred on the first day of the relevant Rolling Four Quarters, (v) any
Indebtedness or any Disqualified Capital Stock that is incurred, acquired or
assumed in connection with such acquisition shall be in compliance with Section
6.1 and (d) with respect to any transactions or series of related transactions
with a value in excess of $5,000,000, the Borrower has delivered to the
Administrative Agent an officers' certificate to the effect set forth in clauses
(a), (b) and (c) above, together with all relevant financial information for the
Person or assets to be acquired.
"Permitted Liens" shall mean Liens permitted under Section 6.2
hereof.
"Person" shall mean any natural person, corporation, division
of a corporation, partnership, limited liability partnership, limited liability
company, trust, joint venture, association, company, estate, unincorporated
organization or government or any agency or political subdivision thereof.
"Plan" shall mean an employee pension benefit plan within the
meaning of Section 3(2) of ERISA, other than a Multiemployer Plan, maintained or
contributed to by any Credit Party, or any ERISA Affiliate, or otherwise
pursuant to which any Credit Party could have liability.
"Plan of Reorganization" shall mean the plan of reorganization
filed with the Bankruptcy Court and confirmed by the order dated September 20,
2001 with respect to those certain cases pending under Chapter 11 of the
Bankruptcy Code in the District of Delaware filed by (i) the Borrower and
certain of its subsidiaries (Case Nos. 00-02691 through 00-2836 (JHW), which
cases are jointly administered as Case No. 00-2692 (JHW)) and (ii) Multicare
AMC, Inc. and certain of its subsidiaries (Case Nos. 00-2494 through 00-2690
(JHW) which cases are jointly administered as Case No. 00-2494 (JHW)).
22
"Pledged Collateral" shall mean the Pledged Securities and any
proceeds or products thereof or income therefrom, in any form, together with (i)
all profits, dividends and distributions to which a Pledgor shall at any time be
entitled in respect of its Pledged Securities; (ii) all other payments, if any,
due or to become due to a Pledgor in respect of its Pledged Securities, whether
as contractual obligations, damages, insurance proceeds, condemnation awards or
otherwise; (iii) all of a Pledgor's claims, rights, powers, privileges,
authority, options, security interest, liens and remedies, if any, under or
arising out of the ownership of such Pledgor's Pledged Securities; (iv) all
present and future claims, if any, of a Pledgor against the applicable entity in
which such Pledgor owns its Pledged Securities or under or arising out of the
applicable partnership or operating agreement, as applicable, for monies loaned
or advanced, for services rendered or otherwise; (v) to the extent permitted by
Applicable Law, all of a Pledgor's rights, if any, under the applicable
partnership or operating agreement, as applicable, or at law, to exercise and
enforce every right, power, remedy, authority, option and privilege of such
Pledgor relating to its Pledged Securities, including, without limitation, any
power to terminate, cancel or modify the applicable partnership or operating
agreement, as applicable, to execute any instruments and to take any and all
other action on behalf of and in the name of such Pledgor in respect of its
Pledged Securities and the entity in which such Pledgor owns its Pledged
Securities, to make determinations, to exercise any election (including, but not
limited to, election of remedies) or option or to give or receive any notice,
consent, amendment, waiver or approval, together with full power and authority
to demand, receive, enforce or collect any of the foregoing or any property of
the applicable entity, to enforce or execute any checks, or other instruments or
orders, to file any claims and to take any action in connection with any of the
foregoing; and (vi) to the extent not otherwise included, any and all proceeds
(as defined in Section 9-102(a)(64) of the UCC) of any or all of the foregoing.
"Pledged Securities" shall mean all Capital Stock now or
hereafter owned by a Credit Party; excluding any of the foregoing that
constitutes Excluded Assets. The Pledged Securities as of the Closing Date are
listed on Schedule 3.21(a), under the heading "Pledged Capital Stock and Other
Pledged Equity Interests."
"Pledgor" shall mean a Credit Party that owns any of the
Pledged Securities.
"Premises" shall mean any real property currently or formerly
owned, leased or operated by any Credit Party, including, but not limited to,
all soil, surface water, or groundwater thereat.
"Prepayment Date" shall have the meaning given to such term in
Section 2.11(l) hereof.
"Prime Rate" shall have the meaning given to such term in the
definition of "Base Rate" set forth in this Article 1.
"Pro Forma Basis" shall mean in connection with any
transaction for which a determination on a Pro Forma Basis is required to be
made hereunder, such determination shall be made (i) after giving effect to any
issuance of Indebtedness, any acquisition, any disposition or any other
transaction, as applicable, and (ii) assuming that the issuance of Indebtedness,
acquisition, disposition or other transaction and, if applicable, the
application of proceeds therefrom, occurred at the beginning of the most recent
Rolling Four Quarter period ending at least thirty (30) days prior to the date
on which such issuance of Indebtedness, acquisition, disposition or other
transaction occurred, and (iii) with all calculations of Consolidated Net
Income, Consolidated EBITDA and any financial definition utilizing any such
terms being calculated on a pro-forma basis in accordance with Regulation S-X
under the Exchange Act.
23
"Proprietary Rights" shall have the meaning given to such term
in Section 3.8(a) hereof.
"Purchasing Lender" shall have the meaning given to such term
in Section 2.16(e).
"Real Property Assets" shall mean as of any time, all parcels
of real property, owned and all health care facilities leased at such time
directly or indirectly by any Credit Party , together with in each case, all
buildings, improvements, appurtenant fixtures and equipment, easements and other
property and rights incidental to the ownership or lease (as applicable) of such
parcel of real property or any of the foregoing, other than any of the foregoing
that constitute Excluded Assets.
"Receivables" shall mean all rights to receive payment from an
obligor for services rendered by the Credit Parties in the ordinary course of
business, including but not limited to those which, consistent with such Credit
Party's past accounting practice are classified as (i) Medicare Receivables,
(ii) CHAMPUS Receivables, (iii) CHAMPVA Receivables, (iv) Medicaid Receivables,
(v) TRICARE Receivables, (vi) Blue Cross/Blue Shield patient receivables, (vii)
non-contract patient receivables due from commercial insurance companies, (viii)
contract patient receivables due from health maintenance organizations, prepaid
plans, exclusive provider organizations, preferred provider organizations and
other managed care programs or (ix) private patient receivables representing
balances due from patients for deductibles, coinsurance, copayments and services
not otherwise covered by third party payors, which in any instance is not
evidenced by an instrument or chattel paper. Such amounts shall include all
interest, finance charges or other amounts legally payable by an obligor in
respect thereof.
"Register" shall have the meaning given to such term in
Section 13.3(e).
"Regulation D" shall mean Regulation D of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation U" shall mean Regulation U of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation T" shall mean Regulation T of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulation X" shall mean Regulation X of the Board as from
time to time in effect and all official rulings and interpretations thereunder
or thereof.
"Regulatory Licenses" shall mean any and all licenses,
including provisional licenses, certificates of need, JCAHO and/or other
accreditations, permits, franchising rights to conduct business, approvals by a
Governmental Authority or otherwise, consents, qualifications, operating
authority and/or any other authorizations necessary for a Credit Party to
operate their business.
24
"Reimbursement Approvals" shall mean, with respect to all
Third Party Payor Arrangements, any and all certifications, provider numbers,
provider agreements, (including, without limitation, Medicare Provider
Agreements and Medicaid Provider Agreements) participation agreements,
accreditations (including JCAHO accreditation) and/or any other agreements with
or approvals by organizations and Governmental Authorities, including, without
limitation, the right to reimbursement on a current basis and without
suspension, offset or recoupment, or in due course, as otherwise provided under
law or contract.
"Related Fund" shall mean, with respect to any Lender that is
an investment fund, any other investment fund that invests in commercial loans
and that is managed or advised by the same investment advisor as such Lender or
by an Affiliate of such investment advisor.
"Release" shall mean any discharging, disposing, emitting,
leaking, pumping, pouring, emptying, injecting, escaping, leaching, dumping or
spilling of any Hazardous Material into the Environment.
"Reportable Event" shall mean any reportable event as defined
in Section 4043(c) of ERISA other than those events as to which the 30-day
notice period is waived under (i) subsection .22, .23, .25, .27 or .28 of PBGC
Regulation Section 4043 or (ii) PBGC Regulation Section 4043 solely as a result
of the subject Plan's relevant funding status.
"Required Lenders" shall mean Lenders having Credit Exposure
greater than fifty percent (50%) of the Total Credit Exposure; provided, that
for purposes of this definition, the Credit Exposure of a Lender shall be
disregarded if and for so long as such Lender shall be a Defaulting Lender.
"Required Revolving Credit Lenders" shall mean (i) Revolving
Credit Lenders holding greater than fifty percent (50%) of the unpaid principal
amount, if any, of the Revolving Credit Loans and L/C Exposure then outstanding
or (ii) if no Revolving Credit Loans and no Letters of Credit are then
outstanding, Revolving Credit Lenders holding greater than fifty percent (50%)
of the Total Revolving Credit Commitment; provided, that for purposes of this
definition, the Revolving Credit Loans, the pro rata portion of L/C Exposure or
the Revolving Credit Commitment of a Revolving Credit Lender shall be
disregarded if and for so long as such Revolving Credit Lender shall be a
Defaulting Lender.
"Requirements" shall mean all present and future laws,
statutes, codes, ordinances, orders, judgments, decrees, injunctions, rules,
regulations and requirements of every Governmental Authority having jurisdiction
over any Real Property Asset and all restrictive covenants applicable to any
Real Property Asset.
"Restricted Payment" shall mean (i) any distribution, dividend
or other direct or indirect payment on account of shares of any class of Capital
Stock of a Credit Party (other than distributions and dividends payable solely
in shares of Capital Stock other than Disqualified Capital Stock), (ii) any
redemption or other acquisition, re-acquisition or retirement by a Credit Party
of any shares of any class of its own Capital Stock or the Capital Stock of
another Credit Party or an Affiliate, now or hereafter outstanding (other than
redemptions, acquisitions and retirements payable in shares of Capital Stock
other than Disqualified Capital Stock), (iii) any payment made to retire, or
obtain the surrender of, any outstanding warrants, puts or options or other
rights to purchase or otherwise acquire shares of any Capital Stock of a Credit
Party or an Affiliate, now or hereafter outstanding, (iv) any payment by a
Credit Party of principal of, premium, if any, or interest on, or any
redemption, purchase, retirement, defeasance, sinking fund or similar payment
with respect to any Subordinated Debt and any Indebtedness now or hereafter
outstanding which Indebtedness is subordinated to any of the Obligations, and
(v) any payment under any Synthetic Purchase Agreement.
25
"Revolving Credit Commitment" shall mean the commitment of
each Lender to make Revolving Credit Loans to the Borrower and to participate in
Letters of Credit and Swingline Loans hereunder, up to an aggregate principal
amount, at any one time, not in excess of the amount set forth (i) under such
Lender's name opposite the column entitled "Revolving Credit Commitment" on the
signature pages hereto or (ii) in any applicable Assignment and Acceptance(s) to
which it may be a party, as the case may be, as such amount may be reduced from
time to time in accordance with the terms of this Credit Agreement.
"Revolving Credit Commitment Fee" shall have the meaning given
to such term in Section 2.8(a) hereof.
"Revolving Credit Commitment Termination Date" shall mean the
earlier of (i) the Revolving Credit Loan Maturity Date, and (ii) the date on
which the Total Revolving Credit Commitment shall terminate in accordance with
Section 2.9 or Article 7 hereof.
"Revolving Credit Lender" shall mean any Lender holding a
Revolving Credit Commitment hereunder.
"Revolving Credit Loan Maturity Date" shall mean the fifth
anniversary of the Closing Date.
"Revolving Credit Loans" shall have the meaning given to such
term in Section 2.2 hereof.
"Rights" shall mean, with respect to the Government
Receivables of any Credit Party, the right to receive proceeds therefrom, as
permitted by Applicable Law.
"Rolling Four Quarters" shall mean, with respect to any date
of determination, the fiscal quarter then ended and the three (3) immediately
preceding fiscal quarters considered as a single period.
"S&P" shall mean Standard & Poor's Ratings Group (a division
of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.) or, if such company shall cease to issue
ratings, another nationally recognized statistical rating company selected in
good faith by mutual agreement of the Administrative Agent and the Borrower.
"SEC" shall mean the United States Securities and Exchange
Commission.
"Secured Parties" shall mean the Agents, the Issuing Bank, the
Lenders, the Hedging Banks and each of their respective successors and assigns.
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"Securities Act" shall mean the Securities Act of 1933, as
amended, including the rules and regulations promulgated thereunder.
"Senior Debt" shall mean the Indebtedness outstanding under
this Credit Agreement, and any other Indebtedness secured in whole or in part by
a mortgage or security interest or other Lien on assets of the Borrower or any
other Credit Parties (including, without limitation, the principal portion of
any synthetic lease entered into by the Borrower or any of its Subsidiaries).
"Senior Leverage Ratio" shall mean, at any date for which such
ratio is to be determined, the ratio of Senior Debt at such date to Consolidated
EBITDA for the most recent Rolling Four Quarter period.
"Somerset/▇▇▇▇▇ ▇▇▇▇▇▇▇ Transaction" means the acquisition of
certain assets and/or equity from Southcoast Health System, Inc. and ▇▇▇▇▇▇▇▇
▇▇▇▇ Term Care Services, Inc. related to certain skilled nursing facilities
known as ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Nursing Care Center and Somerset Nursing and
Rehabilitation Center (f/k/a/ SouthCoast Nursing and Rehabilitation Center) in
the Commonwealth of Massachusetts.
"Spin-off" shall mean the spin off of the Borrower and its
Subsidiaries from GHVI as more fully described in the Information Statement.
"Subordinated Debt" shall mean (i) the ElderCare Subordinated
Notes and (ii) all other Indebtedness of any of the Credit Parties that is
subordinated to the Obligations pursuant to written agreements, containing
interest rates, payment terms, maturities, amortization schedules, covenants,
defaults, remedies, subordination provisions and other material terms in form
and substance satisfactory to the Required Lenders.
"Subsidiary" shall mean with respect to any Person, any
corporation, association, joint venture, partnership or other business entity
(whether now existing or hereafter organized) of which at least a majority of
the voting stock or other ownership interests having ordinary voting power for
the election of directors (or the equivalent) is, at the time as of which any
determination is being made, owned or controlled by such Person or one or more
subsidiaries of such Person or by such Person and one or more subsidiaries of
such Person.
"Swapped Asset" shall have the meaning given to such term in
Section 6.7(a)(ix).
"Swingline Lender" shall mean Wachovia Bank, National
Association in its capacity as Swingline Lender.
"Swingline Loan" shall have the meaning given to such term in
Section 2.4 hereof.
"Syndication Agent" shall mean Citicorp North America, Inc. in
its capacity as syndication agent for the Lenders hereunder.
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"Synthetic Purchase Agreement" shall mean any swap, derivative
or other agreement or combination of agreements pursuant to which any Credit
Party is or may become obligated to make (i) any payment in connection with a
purchase by any third party from a Person other than a Credit Party of any
Capital Stock in any Credit Party or any Subordinated Debt or (ii) any payment
(other than on account of a permitted purchase by it of any Capital Stock in any
Credit Party or any Subordinated Debt) the amount of which is determined by
reference to the price or value at any time of any Capital Stock in any Credit
Party or any Subordinated Debt; provided, that no phantom stock or similar plan
providing for payments only to current or former directors, officers or
employees of a Credit Party (or to their heirs or estates) shall be deemed to be
a Synthetic Purchase Agreement.
"Term Loan B Commitment" shall mean the commitment of each
Lender to make B Term Loans to the Borrower up to an aggregate principal amount,
at any one time, not in excess of the amount set forth (i) under such Lender's
name opposite the row entitled "Term Loan B Commitment" on the schedule pages
hereto or (ii) in any applicable Assignment and Acceptance(s) to which it may be
a party, as the case may be, as such amount may be reduced from time to time in
accordance with the terms of this Credit Agreement.
"Term Loan B Lender" shall mean any Lender holding a Term Loan
B Commitment hereunder.
"Term Loan B Maturity Date" shall mean the earlier of (i) the
seventh anniversary of the Closing Date and (ii) the date on which the B Term
Loans shall become due and payable pursuant to Article 7 hereof.
"Third Party Payor Arrangements" shall mean any and all
arrangements with Medicare, Medicaid, CHAMPUS, CHAMPVA, TRICARE and any other
Governmental Authority, or quasi-public agency, Blue Cross, Blue Shield, any and
all managed care plans and organizations, including but not limited to health
maintenance organizations and preferred provider organizations, private
commercial insurance companies, employee assistance programs and/or any other
third party arrangements, plans or programs for payment or reimbursement in
connection with health care services, products or supplies.
"Title Company" shall mean LANDAMERICA Financial Group (or its
subsidiaries or affiliates) or any other title insurance company of recognized
national standing which is acceptable to the Administrative Agent in its sole
discretion.
"Total Credit Commitments" shall mean the sum of the Total
Term Loan B Commitment and the Total Revolving Credit Commitment.
"Total Credit Exposure" shall mean an amount equal to (i) the
aggregate principal amount of all outstanding Loans hereunder, plus (ii) the
then current amount of L/C Exposure, plus (iii) the aggregate amount of the
unused Total Credit Commitments then in effect.
"Total Funded Debt" subject to Section 13.22 hereof, shall
mean with respect to the Borrower and its Consolidated Subsidiaries, all
Indebtedness of the Borrower and its Consolidated Subsidiaries which (i) as of
the date of the creation or incurrence thereof, by its terms matures in, or at
the Borrower's or such Consolidated Subsidiary's option can be extended for, one
year or more from such date of creation or incurrence (including current
portions of such long term Indebtedness), including all hedging agreements and
letters of credit entered into in connection with such Indebtedness and (ii)
should be shown on the consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries in accordance with GAAP; provided; that Total Funded
Debt shall be reduced by the aggregate amount of all cash (other than restricted
cash and restricted investments) on hand, as would be shown on a balance sheet
prepared as of the date of determination all in accordance with GAAP, to the
extent such cash exceeds $40,000,000. The term "Total Funded Debt" shall
include, without limitation, Mortgage Loans, ElderCare Subordinated Notes, and
the principal portion of any synthetic lease entered into by the Borrower or any
of its Consolidated Subsidiaries.
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"Total Leverage Ratio" subject to Section 13.22 hereof, shall
mean, at any date for which such ratio is to be determined, the ratio of Total
Funded Debt of the Borrower and its Consolidated Subsidiaries at such date to
Consolidated EBITDA for the most recent Rolling Four Quarter period. For
purposes of calculating the Total Leverage Ratio, Consolidated EBITDA shall be
calculated on a pro forma basis in accordance with Regulation S-X under the
Exchange Act to give effect to any Permitted Acquisition consummated during the
applicable Rolling Four Quarters as if such Permitted Acquisition were
consummated on the first day of such Rolling Four Quarters.
"Total Revolving Credit Commitment" shall mean the aggregate
amount of the Revolving Credit Commitments then in effect of all of the
Revolving Credit Lenders, as such amount may be reduced or modified from time to
time in accordance with the terms of this Credit Agreement.
"Total Term Loan B Commitment" shall mean the aggregate amount
of the Term Loan B Commitments then in effect of all the Term Loan B Lenders as
such amount may be reduced or modified from time to time in accordance with the
terms of this Credit Agreement.
"Tranche" when used in reference to any Loan or Borrowing,
refers to whether such Loan, or the Loans comprising such Borrowing, are
Revolving Credit Loans, Swingline Loans or B Term Loans.
"TRICARE" shall mean, collectively, a program of medical
benefits covering former and active members of the uniformed services and
certain of their dependents, financed and administered by the United States
Departments of Defense, Health and Human Services and Transportation, which
program was formerly known as the Civilian Health and Medical Program of the
Uniformed Services (CHAMPUS), and all laws, rules, regulations, manuals, orders
and administrative, reimbursement and other guidelines of all Governmental
Authorities promulgated in connection with such program (whether or not having
the force of law), in each case as the same may be amended, supplemented or
otherwise modified from time to time.
"TRICARE Receivable" shall mean a Receivable payable to a
Credit Party pursuant to TRICARE.
"UCC" shall mean the Uniform Commercial Code as in effect in
the State of New York from time to time.
"Uniform Customs" shall have the meaning given to such term in
Section 2.21(c) hereof.
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"Unrestricted Subsidiary" shall mean those Subsidiaries listed
on Schedule 3.7(b) hereto and any other Subsidiary of any Credit Party
designated by the Borrower as an Unrestricted Subsidiary in a written notice to
the Administrative Agent; provided, however, that (i) after giving effect to
such designation, no Default or Event of Default shall be continuing at the time
of such designation or on a pro forma basis as of the most recent date for which
a compliance certificate has been delivered pursuant to Section 5.1(a)(iii)
hereof and (ii) any Credit Party may elect that any Unrestricted Subsidiary no
longer remain an Unrestricted Subsidiary by providing written notice thereof to
the Administrative Agent along with an Instrument of Assumption and Joinder
executed by such former Unrestricted Subsidiary, appropriate UCC-1 financing
statements, certificates representing all Pledged Securities owned by such
former Unrestricted Subsidiary together with an undated stock power executed in
blank, corporate documents to the extent set forth in Section 4.1(a) and, upon
request, Mortgages or any Real Property Assets owned by such former Unrestricted
Subsidiary, written opinions of counsel (which may be an employee of, or counsel
for, a Credit Party) in form and substance reasonably satisfactory to the
Administrative Agent; provided, further, that after giving effect to such
election, no Default or Event of Default shall be continuing at the time of such
election or on a pro forma basis as of the most recent date for which a
compliance certificate has been delivered pursuant to Section 5.1(a)(iii)
hereof.
2. THE LOANS
SECTION 2.1 B Term Loans. (a) Each Term Loan B Lender,
severally and not jointly, agrees, upon the terms and subject to the conditions
hereinafter set forth to make a term loan (each a "B Term Loan" and collectively
the "B Term Loans") to the Borrower on the Closing Date in a single draw in a
principal amount equal to such Term Loan B Lender's Term Loan B Commitment.
(b) The B Term Loans may be used (i) to transfer funds to GHVI
in consideration for certain assets being transferred to the Borrower in
connection with the Spin-off with the understanding that GHVI may finance the
repayment of its existing indebtedness and payment of transaction fees and
expenses relating to the Spin-off, and (ii) to finance Fees and other expenses
incurred in connection with the Spin-off and this Credit Agreement and for
general corporate purposes (including working capital expenditures and permitted
acquisitions) in accordance with the provisions of this Credit Agreement.
(c) The B Term Loans shall be made by each Term Loan B Lender
ratably in accordance with its Term Loan B Percentage.
(d) Once repaid, no B Term Loans may be re-borrowed.
SECTION 2.2 Revolving Credit Loans. (a) Each Revolving Credit
Lender, severally and not jointly, agrees, upon the terms and subject to the
conditions hereinafter set forth, to make loans (each a "Revolving Credit Loan"
and collectively, the "Revolving Credit Loans") to the Borrower on any Business
Day and from time to time from the Closing Date to but excluding the Revolving
Credit Commitment Termination Date, each in a principal amount which when added
to the aggregate principal amount of all Revolving Credit Loans then outstanding
to the Borrower from such Revolving Credit Lender, plus such Revolving Credit
Lender's Revolving Credit Percentage of the then current L/C Exposure, plus such
Revolving Credit Lender's Percentage of the Total Revolving Credit Commitment of
the aggregate principal amount of all Swingline Loans then outstanding, does not
exceed such Revolving Credit Lender's Revolving Credit Commitment (after giving
effect to all Revolving Credit Loans and Swingline Loans repaid and all
reimbursements of Letters of Credit made concurrently with the making of any
Revolving Credit Loans).
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(b) The Revolving Credit Loans may be used for general
corporate purposes (including working capital expenditures and acquisitions
permitted under Section 6.7(b) hereof) in accordance with the provisions of this
Credit Agreement.
(c) Each Revolving Credit Loan requested hereunder on any date
shall be made by each Revolving Credit Lender ratably in accordance with its
Percentage of the Total Revolving Credit Commitment.
(d) Subject to the terms and conditions of this Credit
Agreement, at any time prior to the Revolving Credit Commitment Termination
Date, the Borrower may borrow, repay and re-borrow amounts constituting the
Revolving Credit Loans.
SECTION 2.3 Disbursement of Funds and Notice of Borrowing of
Revolving Credit Loans. (a) The Borrower shall give the Administrative Agent
prior written, facsimile or telephonic (promptly confirmed in writing) notice of
each Borrowing of Revolving Credit Loans hereunder; such notice shall be
irrevocable and to be effective, must be received by the Administrative Agent
not later than 12:00 noon (Eastern time), (i) in the case of Base Rate Loans, on
the Business Day on which such Loan is to be made and (ii) in the case of
Eurodollar Loans, on the third Business Day preceding the date on which such
Loan is to be made. Each such written notice or written confirmation of
telephonic notice shall be given in substantially the form of the Borrowing
Certificate appropriately completed to specify (A) the amount of the proposed
Borrowing, (B) the date thereof (which shall be a Business Day) and (C) whether
the Loan(s) then being requested are to be (or what portion or portions thereof
are to be) a Base Rate Loan or a Eurodollar Loan and the Interest Period or
Interest Periods with respect thereto in the case of Eurodollar Loans. In the
case of a Eurodollar Loan, if no election of an Interest Period is specified in
such notice, such notice shall be deemed a request for an Interest Period of one
month. If no election is made as to the Interest Rate Type of any Loan, such
notice shall be deemed a request for a Base Rate Loan.
(b) The Administrative Agent shall promptly notify each Lender
of its proportionate share of each Borrowing, the date of such Borrowing, the
Interest Rate Type of each Loan being requested and the Interest Periods
applicable thereto. On the borrowing date specified in such notice (and on the
Closing Date, in the case of the B Term Loans), each Lender shall make its
proportionate share of the Borrowing available at the office of the
Administrative Agent, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention:
Syndication Agency Services for credit to Genesis HealthCare Corporation and in
each case, no later than 2:00 p.m. Eastern time in the case of a Borrowing
consisting of Base Rate Loans and 1:00 p.m. Eastern time in the case of a
Borrowing consisting of Eurodollar Loans, in Federal or other immediately
available funds (provided that the Swingline Loans shall be made as provided in
Section 2.4).
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(c) Notwithstanding any provision to the contrary in this
Credit Agreement, the Borrower shall not, in any notice of Borrowing under this
Section 2.3 request any Eurodollar Loan which, if made, would result in an
aggregate of more than seven (7) separate Eurodollar Loans (whether such
Eurodollar Loans are Revolving Credit Loans or B Term Loans) of any Lender being
outstanding hereunder at any one time. For purposes of the foregoing, Eurodollar
Loans having Interest Periods commencing and ending on the same days shall be
considered one (1) single Eurodollar Loan.
(d) The aggregate amount of any Borrowing of a Loan consisting
of a Eurodollar Loan shall be in a minimum aggregate principal amount of
$5,000,000 or such greater amount which is an integral multiple of $1,000,000,
and the aggregate amount of any Borrowing of a Loan consisting of a Base Rate
Loan (other than a Swingline Loan) shall be in a minimum aggregate principal
amount of $2,000,000 or such greater amount which is an integral multiple of
$1,000,000 (or such lesser amount as shall equal (i) the available but unused
portion of the Total Credit Commitment then in effect or (ii) the amount
necessary to fund a drawing under a Letter of Credit). The aggregate amount of
any Borrowing of a Swingline Loan shall be in a minimum aggregate principal
amount of $250,000 or such greater amount which is an integral multiple of
$50,000.
(e) The Administrative Agent shall disburse the proceeds of
Loans by depositing them (other than a Revolving Credit Loan or Swingline Loan
used to fund a drawing under a Letter of Credit) on the date of the Borrowing in
an account of the Borrower as the Borrower may specify to the Administrative
Agent in writing.
SECTION 2.4 Swingline Loans. (a) Subject to the terms and
conditions set forth herein, the Swingline Lender agrees to make loans (each a
"Swingline Loan", and collectively, the "Swingline Loans") to the Borrower from
time to time from the Closing Date to but excluding the Revolving Credit
Commitment Termination Date, in an aggregate principal amount at any time
outstanding that will not result in (i) the aggregate principal amount of
outstanding Swingline Loans exceeding $10,000,000 or (ii) the aggregate
principal amount of all Revolving Credit Loans then outstanding plus the
aggregate L/C Exposure then existing plus the aggregate principal amount of all
Swingline Loans then outstanding exceeding the Total Revolving Credit
Commitment; provided that the Swingline Lender shall not be required to make a
Swingline Loan to refinance an outstanding Swingline Loan. Within the foregoing
limits and subject to the terms and conditions set forth herein, the Borrower
may borrow, repay and reborrow Swingline Loans.
(b) To request a Swingline Loan, the Borrower shall notify the
Administrative Agent of such request by telephone (confirmed by facsimile), not
later than 12:00 noon, Eastern time, on the day of a proposed Swingline Loan.
Each such notice shall be irrevocable and shall specify the requested date
(which shall be a Business Day) and amount of the requested Swingline Loan. The
Administrative Agent will promptly advise the Swingline Lender of any such
notice received from the Borrower. The Swingline Lender shall disburse the
proceeds of each Swingline Loan by depositing them on the date of the Borrowing
in an account of the Borrower as the Borrower may specify to the Administrative
Agent in writing by 3:00 p.m., Eastern time, on the requested date of such
Swingline Loan.
32
(c) The Swingline Lender may by written notice given to the
Administrative Agent not later than 10:00 a.m., Eastern time, on any Business
Day require the Lenders to acquire participations on such Business Day in all or
a portion of the Swingline Loans outstanding. Such notice shall specify the
aggregate amount of Swingline Loans in which Lenders will participate. Promptly
upon receipt of such notice, the Administrative Agent will give notice thereof
to each Lender, specifying in such notice such Lender's ratable portion of such
Swingline Loan or Loans (in accordance with its respective Percentage of the
Total Revolving Credit Commitments). Each Lender hereby absolutely and
unconditionally agrees, upon receipt of notice as provided above, to pay to the
Administrative Agent, for the account of the Swingline Lender, such Lender's
ratable portion of such Swingline Loan or Loans (in accordance with its
respective Percentage of the Total Revolving Credit Commitments). Each Lender
acknowledges and agrees that its obligation to acquire participations in
Swingline Loans pursuant to this paragraph is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including the occurrence
and continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding
or reduction whatsoever. Each Lender shall comply with its obligation under this
paragraph by wire transfer of immediately available funds, in the same manner as
provided in Section 2.3(b) with respect to Loans made by such Lender (and
Section 2.3(b) shall apply, mutatis mutandis, to the payment obligations of the
Lenders), and the Administrative Agent shall promptly pay to the Swingline
Lender the amounts so received by it from the Lenders. The Administrative Agent
shall notify the Borrower of any participations in any Swingline Loan acquired
pursuant to this paragraph, and thereafter payments in respect of such Swingline
Loan shall be made to the Administrative Agent and not to the Swingline Lender.
Any amounts received by the Swingline Lender from the Borrower (or other party
on behalf of the Borrower) in respect of a Swingline Loan after receipt by the
Swingline Lender of the proceeds of a sale of participations therein shall be
promptly remitted to the Administrative Agent; any such amounts received by the
Administrative Agent shall be promptly remitted by the Administrative Agent to
the Lenders that shall have made their payments pursuant to this paragraph and
to the Swingline Lender, as their interests may appear; provided that any such
payment so remitted shall be repaid to the Swingline Lender or to the
Administrative Agent, as applicable, if and to the extent such payment is
required to be refunded to the Borrower for any reason. The purchase of
participations in a Swingline Loan pursuant to this paragraph shall not relieve
the Borrower of any default in the payment thereof.
SECTION 2.5 Interest Rate Type of the Loans. Each Loan shall
be either a Base Rate Loan or Eurodollar Loan (each such type of Loan, an
"Interest Rate Type") as the Borrower may request either (i) in its notice of
Borrowing delivered to the Administrative Agent pursuant to Section 2.3(a)
hereof or (ii) as such Loan may be continued or converted pursuant to the
provisions of Section 2.14 hereof; provided that each Swingline Loan shall be a
Base Rate Loan. Subject to Sections 2.16(d) and 2.18(g) hereof, each Lender may
at its option fulfill its obligations hereunder with respect to any Eurodollar
Loan by causing a foreign Lending Office to make such Loan; provided, that any
exercise of such option shall not affect the obligation of the Borrower to repay
such Loan in accordance with the terms hereof and of any note evidencing such
Loan. Subject to the other provisions of Section 2.3, Section 2.13(b) and
Section 2.17, Loans of more than one Interest Rate Type may be outstanding at
the same time.
33
SECTION 2.6 Repayment; Evidence of Debt; Administration. (a)
The Loans shall be subject to voluntary prepayment as provided in Section 2.10
hereof, to mandatory prepayment as provided in Section 2.11 hereof, amortization
as provided in Section 2.12 hereof and acceleration as provided in Article 7
hereof.
(b) The outstanding principal balance of the Revolving Credit
Loans shall be payable in full on the Revolving Credit Commitment Termination
Date, and the outstanding principal balance of the B Term Loans shall be payable
in full on the Term Loan B Maturity Date.
(c) The outstanding principal balance of the Swingline Loans
shall be payable in full on the earlier of (i) the Revolving Credit Commitment
Termination Date and (ii) thirty (30) days after such Swingline Loan is made;
provided that on each day a Revolving Credit Loan is made, the Borrower shall
repay all then-outstanding Swingline Loans.
(d) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such Lender resulting from each Loan made by such Lender, including the amounts
of principal and interest payable and paid to such Lender from time to time
hereunder.
(e) The Administrative Agent shall maintain accounts in which
it shall record (i) the amount of each outstanding Loan hereunder, the Interest
Rate Type thereof and the Interest Period applicable thereto, (ii) the amount of
any principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder and (iii) the amount of any sum received by
the Administrative Agent hereunder for the account of the Lenders and each
Lender's share thereof.
(f) The entries made in the accounts maintained pursuant to
paragraph (c) or (d) of this Section 2.6 shall be prima facie evidence of the
existence and amounts of the Obligations recorded therein; provided, however,
that the failure of any Lender or the Administrative Agent to maintain such
accounts or any error therein shall not in any manner affect the obligation of
the Borrower to repay the Loans and other Obligations in accordance with the
terms of this Credit Agreement.
(g) Any Lender may request that Loans made by it be evidenced
by a promissory note. In such event, the Borrower shall promptly prepare,
execute and deliver to such Lender a promissory note payable to the order of
such Lender (or, if requested by such Lender, to such Lender and its registered
assigns), in substantially the form of Exhibit E hereto. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 13.3 hereof) be represented by
one or more promissory notes in such form payable to the order of the payee
named therein.
(h) All amounts received by the Administrative Agent from or
on behalf of the Borrower as a payment or prepayment of, or interest on, the B
Term Loans or the Revolving Credit Loans shall be applied among the Lenders
holding the B Term Loans or the Revolving Credit Loans, as the case may be,
ratably in accordance with the outstanding B Term Loans or the Revolving Credit
Loans (as the case may be) owed to each such Lender.
34
SECTION 2.7 Interest. (a) In the case of a Base Rate Loan,
interest shall be payable at a rate per annum (computed on the basis of the
actual number of days elapsed over a year of 360 days) equal to the Base Rate
plus the Applicable Interest Margin. Interest shall be payable in arrears on
each Base Rate Loan on each Interest Payment Date, on the Term Loan B Maturity
Date (in the case of a Base Rate Loan which is a B Term Loan), and on the
Revolving Credit Commitment Termination Date (in the case of a Base Rate Loan
which is either a Revolving Credit Loan or a Swingline Loan).
(b) In the case of a Eurodollar Loan, interest shall be
payable at a rate per annum (computed on the basis of the actual number of days
elapsed over a year of 360 days) equal to the Adjusted LIBO Rate plus the
Applicable Interest Margin. Interest shall be payable on each Eurodollar Loan on
each Interest Payment Date, on the Term Loan B Maturity Date (in the case of a
Eurodollar Loan which is a B Term Loan), and on the Revolving Credit Commitment
Termination Date (in the case of a Eurodollar Loan which is a Revolving Credit
Loan). The Administrative Agent shall determine the applicable Adjusted LIBO
Rate for each Interest Period as soon as practicable on the date when such
determination is to be made in respect of such Interest Period and shall
promptly notify the Borrower and the Lenders of the applicable interest rate so
determined. Such determination shall be conclusive absent manifest error.
(c) Interest in respect of any Loan hereunder shall accrue
from and including the date of such Loan to but excluding the date on which such
Loan is paid or, if applicable, converted to a Loan of a different Interest Rate
Type.
(d) Anything in this Credit Agreement or in any note
evidencing any Loan hereunder to the contrary notwithstanding, the interest rate
on the Loans or with respect to any drawing under a Letter of Credit shall in no
event be in excess of the maximum rate permitted by Applicable Law.
SECTION 2.8 Revolving Credit Commitment Fees, Facility Fee and
Other Fees. (a) The Borrower agrees to pay to the Administrative Agent for the
account of each Revolving Credit Lender quarterly in arrears on the last
Business Day of each March, June, September and December (commencing the last
Business Day of December 2003) prior to the Revolving Credit Commitment
Termination Date, on the date of any termination or reduction of the Total
Revolving Credit Commitment, and on the Revolving Credit Commitment Termination
Date, a fee (the "Revolving Credit Commitment Fee") at a rate per annum of 0.50%
of such Revolving Credit Lender's Revolving Credit Commitment, whether used or
unused (computed on the basis of the actual number of days elapsed during the
period over a year of 360 days).
(b) The Revolving Credit Commitment Fees shall commence to
accrue on the Closing Date.
(c) The Borrower agrees to pay to the applicable party, on the
Closing Date, any and all Fees, expenses and other amounts that are then due and
payable pursuant to the Fee Letter and, thereafter, any and all Fees, expenses
and other amounts payable thereunder when due and payable.
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SECTION 2.9 Termination and/or Reduction of the Total
Revolving Credit Commitment. (a) Upon at least three (3) Business Days' prior
written, facsimile or telephonic notice (provided, that such telephonic notice
is immediately followed by written confirmation) to the Administrative Agent,
the Borrower may at any time in whole permanently terminate, or from time to
time in part permanently reduce, the Total Revolving Credit Commitment. In the
case of a partial reduction, each such reduction shall be in a minimum aggregate
principal amount of $5,000,000 or an integral multiple thereof; provided,
however, that the Total Revolving Credit Commitment may not be reduced to an
amount less than the aggregate principal amount of all Revolving Credit Loans
and Swingline Loans then outstanding, plus the then current L/C Exposure.
(b) The Total Revolving Credit Commitment shall automatically
and permanently reduce, on the date of any mandatory prepayment or repayment of
Revolving Credit Loans, pursuant to Section 2.11(g) or 2.11(i) hereof, in an
amount equal to such mandatory prepayment or repayment of Revolving Credit
Loans.
(c) Any partial reduction of the Total Revolving Credit
Commitment hereunder shall be made among the Revolving Credit Lenders in
accordance with their respective Percentages of the Total Revolving Credit
Commitment.
(d) Simultaneously with each termination or reduction of the
Total Revolving Credit Commitment, the Borrower shall pay to the Administrative
Agent for the benefit of the Revolving Credit Lenders all accrued and unpaid
Revolving Credit Commitment Fees on the amount of the Total Revolving Credit
Commitment so terminated or reduced through the date of such termination or
reduction.
SECTION 2.10 Voluntary Prepayments. (a) The Borrower shall
have the right at its option at any time and from time to time to prepay (i) any
Base Rate Loan (other than the Swingline Loan), in whole or in part, upon same
day prior written, facsimile, or telephonic (promptly confirmed in writing)
notice to the Administrative Agent received not later than 11:30 a.m. (Eastern
time) on such day, in the principal amount of $2,000,000 or such greater amount
which is an integral multiple of $1,000,000 if prepaid in part, (ii) any
Eurodollar Loan, in whole or in part, upon same day prior written, facsimile, or
telephonic (promptly confirmed in writing) notice received not later than 11:30
a.m. (Eastern time) on such day, in the principal amount of $5,000,000 or such
greater amount which is an integral multiple of $1,000,000 if prepaid in part,
(iii) any Swingline Loan, in whole or in part, by providing written, telephonic
(promptly confirmed in writing) or facsimile notice to the Administrative Agent
and the Swingline Lender no later than 12:00 noon, Eastern time, on the day of
such prepayment, in the minimum principal amount of $250,000; provided, that in
the case of Eurodollar Loans the Borrower pays any amounts required to be paid
under Section 2.15 as a result of such prepayment. Each notice of prepayment
shall specify the prepayment date, each Loan to be prepaid and the principal
amount thereof, shall be irrevocable and shall commit the Borrower to prepay
each such Loan in the amount and on the date stated therein. All prepayments
under this Section 2.10 on account of B Term Loans shall be applied ratably in
accordance with each Lender's proportionate share of the B Term Loans and
against scheduled amortization payments of the B Term Loans in inverse order of
the maturity thereof.
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SECTION 2.11 Mandatory Prepayments. (a) If at any time the sum
of the aggregate principal amount of all Revolving Credit Loans outstanding,
plus the aggregate principal amount of all Swingline Loans plus the then current
L/C Exposure shall exceed the Total Revolving Credit Commitment, the Borrower
will immediately prepay such Revolving Credit Loans to the extent necessary to
eliminate such excess.
(b) On or before January 15 in each year (commencing on
January 15, 2005), the Borrower shall prepay Loans in an amount equal to 75% of
the Excess Cash Flow for the immediately preceding fiscal year; provided,
however, that if the Total Leverage Ratio is less than 2.75:1.00, then such
prepayment shall be in an amount equal to 50% of such Excess Cash Flow.
Concurrently with the making of each such prepayment, the Borrower shall deliver
to the Administrative Agent, a certificate in such form as may be reasonably
satisfactory to the Administrative Agent, signed by the chief financial officer
of the Borrower, setting forth in reasonable detail the calculation of Excess
Cash Flow for the immediately preceding fiscal year.
(c) Within two (2) Business Days of the receipt of any Net
Cash Proceeds by the Borrower or any Credit Party, the Borrower shall prepay
Loans in an amount equal to 100% of the Net Cash Proceeds received by such
Credit Party; provided, that no prepayment shall be required to the extent such
Net Cash Proceeds are reinvested in assets to be used in the business of the
Credit Parties within 365 days of the receipt of such Net Cash Proceeds.
(d) Within two (2) Business Days following the receipt by the
Borrower or any other Credit Party (or by the Administrative Agent as loss
payee) of any payment of proceeds of (i) any insurance relating to any
Collateral (other than business interruption insurance) required to be
maintained pursuant to this Credit Agreement or any other Fundamental Document
on account of each separate loss, damage or injury in excess of $5,000,000 to
any tangible real or personal property of the Borrower or any of its
Subsidiaries other than Excluded Assets, or (ii) any condemnation proceeding
affecting any Real Property Asset (provided, that, so long as no Default or
Event of Default shall have occurred and then be continuing, such insurance or
condemnation proceeds (or any portion thereof) may be expended or irrevocably
committed by the Borrower or any of its Subsidiaries to repair or replace such
property within 180 days of such loss, damage, injury or condemnation and the
Borrower shall furnish to the Administrative Agent evidence satisfactory to the
Administrative Agent of such expenditure or commitment and shall have certified
to the Administrative Agent that such proceeds (or such proceeds together with
other funds available to the Borrower) are sufficient to repair or replace such
property), the Borrower shall prepay or, to the extent the Administrative Agent
is loss payee under any insurance policy, irrevocably direct the Administrative
Agent to apply as a prepayment of the Loans, an amount equal to 100% (or such
lesser percentage which represents that portion of such proceeds not expended or
committed pursuant to the immediately preceding parenthetical phrase) of such
insurance or condemnation proceeds; provided, that if an Event of Default shall
have occurred and be continuing, the Administrative Agent may require all
proceeds of insurance required to be maintained pursuant to this Credit
Agreement or any other Fundamental Document which would otherwise be payable to
the Borrower to be paid to the Administrative Agent and applied pursuant to
Section 12.2(b).
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(e) At any time the Total Leverage Ratio is equal to or
greater than 2.75:1.00, within two (2) Business Days of the receipt of any Net
Offering Proceeds from any sale of Capital Stock by the Borrower or any other
Credit Party, the Borrower shall prepay Loans in an amount equal to 50% of such
Net Offering Proceeds received.
(f) At any time the Borrower or any other Credit Party
receives Net Offering Proceeds from the issuance of Subordinated Debt, then
within two (2) Business Days of the receipt of such Net Offering Proceeds, the
Borrower shall prepay the Loans in an amount equal to 100% of the Net Offering
Proceeds.
(g) So long as no Default or Event of Default has occurred and
is then continuing, any prepayments required under Section 2.11(b), (c), (d),
(e) or (f) shall be applied: (i) first to the outstanding principal balance (in
inverse order of maturity) of the B Term Loans held by each Lender which does
not elect to opt-out of such prepayment pursuant to Section 2.11(h) ratably in
accordance with each Lender's proportionate share of the B Term Loans, (ii)
second to the outstanding principal balance of the Swingline Loans, (iii) third
to the outstanding principal balance of the Revolving Credit Loans ratably in
accordance with each Lender's proportionate share of Revolving Credit Loans and
(iv) fourth the remainder, if any, may, at the Borrower's request, be applied as
a voluntary prepayment in accordance with Section 2.10 hereof and to the extent
not so applied may be retained by the Borrower.
(h) The Administrative Agent shall make the prepayments of B
Term Loans to each Term Loan B Lender to the extent required by 2.11(g)(i)
unless not later than 11:30 a.m. Eastern time two (2) Business Days prior to the
making of such prepayment, the Administrative Agent shall have received notice
from a Term Loan B Lender electing not to receive such prepayment (each such
Lender, an "Opt-Out Lender").
(i) If a Default or an Event of Default has occurred and is
then continuing, at any time a prepayment is required under Section 2.11(b),
(c), (d), (e) or (f), then such prepayment shall be applied to the outstanding
principal balance (in inverse order of maturity in the case of B Term Loans) of
B Term Loans and Revolving Credit Loans ratably to each Tranche of Loans in
accordance with each Lender's proportionate share of each Tranche of such Loans.
(j) All prepayments of Loans under this Section 2.11 shall, as
regards Interest Rate Type, be applied first to Base Rate Loans, and subject to
Section 2.11(l) hereof, then to Eurodollar Loans in the order of the scheduled
expiry of Interest Periods with respect thereto (i.e. those Eurodollar Loans
with Interest Periods which end sooner would be paid before those with Interest
Periods which end later).
(k) All prepayments under this Section 2.11 shall be
accompanied by accrued but
unpaid interest on the principal amount being prepaid to (but not including) the
date of prepayment.
(l) If on any day on which Loans would otherwise be required
to be prepaid pursuant to this Section 2.11, but for the operation of this
Section 2.11(l) (each a "Prepayment Date"), the amount of such required
prepayment exceeds the then outstanding aggregate principal amount of Base Rate
Loans which are of the Tranche required to be prepaid, and no Default or Event
of Default exists or is continuing, then on such Prepayment Date, (i) the
Borrower shall deposit Dollars into the Cash Collateral Account in an amount
equal to such excess, and only the outstanding Base Rate Loans which are of the
Tranche required to be prepaid shall be required to be prepaid on such
Prepayment Date and (ii) on the last day of each Interest Period after such
Prepayment Date in effect with respect to a Eurodollar Loan which is of the
Tranche required to be prepaid, the Administrative Agent is irrevocably
authorized and directed to apply funds from the Cash Collateral Account (and
liquidate investments held in the Cash Collateral Account as necessary) to
prepay such Eurodollar Loans for which the Interest Period is then ending to the
extent funds are available in the Cash Collateral Account.
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SECTION 2.12 Amortization. The Borrower shall be required to
repay the principal amount of the B Term Loans, to the extent then outstanding,
in equal installments of $462,500 each, commencing on the last Business Day of
March 2004, and continuing on the last Business Day of each quarter thereafter
through the Term Loan B Maturity Date, and the outstanding balance of the B Term
Loans on the Term Loan B Maturity Date.
SECTION 2.13 Default Interest; Alternate Rate of Interest. (a)
In the event that, and for so long as, (i) any Event of Default described in
Section 7.1(h) or Section 7.1(i) hereof shall have occurred and be continuing,
or (ii) any other Event of Default shall have occurred and be continuing and the
Borrower shall have received written notice from the Administrative Agent that
the default rate shall be in effect, the Borrower shall on demand from time to
time pay interest, to the extent permitted by Applicable Law, on all Loans and
overdue amounts outstanding up to (but not including) the date of actual payment
of such Loan or overdue amount (after as well as before judgment) (i) for the
remainder of the then current Interest Period for each Eurodollar Loan, at 2% in
excess of the rate then in effect for each such Eurodollar Loan, (ii) for all
periods subsequent to the then current Interest Period for each Eurodollar Loan
and for all Base Rate Loans of a particular Tranche, at 2% in excess of the rate
then in effect for Base Rate Loans of the same Tranche and (iii) for all other
overdue amounts hereunder, at 2% in excess of the rate then in effect for Base
Rate Loans which are B Term Loans.
(b) In the event, and on each occasion, that on or before the
day on which the Adjusted LIBO Rate for a Eurodollar Loan is to be determined as
set forth herein, (i) the Administrative Agent shall have received notice from
any Lender of such Lender's determination (which determination, absent manifest
error, shall be conclusive) that Dollar deposits in an amount equal to the
principal amount of such Lender's Eurodollar Loan are not generally available in
the London Interbank Market or that the rate at which such Dollar deposits are
being offered will not adequately and fairly reflect the cost to such Lender of
making or maintaining the principal amount of such Lender's Eurodollar Loan
during the applicable Interest Period or (ii) the Administrative Agent shall
have determined that reasonable means do not exist for ascertaining the
applicable Adjusted LIBO Rate, the Administrative Agent shall, as soon as
practicable thereafter, give written or facsimile notice of such determination
by such Lender or the Administrative Agent to the Borrower and the Lenders and
any request by the Borrower for a Eurodollar Loan pursuant to Section 2.3 or
conversion to or continuation as a Eurodollar Loan pursuant to Section 2.14,
made after receipt of such notice and until the circumstances giving rise to
such notice no longer exist, shall be deemed to be a request for a Base Rate
Loan; provided, however, that in the circumstances described in clause (i)
above, such deemed request shall only apply to the affected Lender's portion
thereof.
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SECTION 2.14 Continuation and Conversion of Loans. The
Borrower shall have the right, at any time, (i) to convert any Eurodollar Loan
or portion thereof to a Base Rate Loan or to continue any Eurodollar Loan for a
successive Interest Period, or (ii) to convert any Base Rate Loan (other than a
Swingline Loan) or portion thereof to a Eurodollar Loan, subject to the
following:
(a) at least three (3) Business Days prior to any conversion
or continuation hereunder, the Borrower shall give the Administrative Agent
written, facsimile or telephonic (promptly confirmed in writing) notice with
respect thereto; such notice shall be irrevocable and to be effective, must be
received by the Administrative Agent on the day required not later than 11:30
a.m. Eastern time;
(b) unless the Required Lenders otherwise consent, no Event of
Default shall have occurred and be continuing at the time of any conversion to a
Eurodollar Loan or continuation of a Eurodollar Loan into a subsequent Interest
Period;
(c) the aggregate principal amount of Loans continued as, or
converted to, Eurodollar Loans as part of the same continuation or conversion,
shall be in a minimum amount of $5,000,000 or in such greater amount which is an
integral multiple of $1,000,000;
(d) if fewer than all Loans of a particular Tranche at the
time outstanding shall be continued or converted, such continuation or
conversion shall be made pro rata among the Lenders in accordance with the
respective principal amount of such Loans held by the Lenders immediately prior
to such continuation or conversion;
(e) no Base Rate Loan (or portion thereof) may be converted to
a Eurodollar Loan and no Eurodollar Loan may be continued as a Eurodollar Loan
if, after such conversion or continuation, and after giving effect to any
concurrent prepayment of Loans, an aggregate of more than the number of separate
Eurodollar Loans permitted under Section 2.3(c) hereof would be outstanding
hereunder;
(f) the Interest Period with respect to a new Eurodollar Loan
effected by a continuation or conversion shall commence on the date of such
continuation or conversion;
(g) if a Eurodollar Loan is converted to a Base Rate Loan
other than on the last day of the Interest Period with respect thereto, the
amounts required by Section 2.15 shall be paid upon such conversion;
(h) accrued interest on a Eurodollar Loan (or portion thereof)
being converted to a Base Rate Loan shall be paid by the Borrower at the time of
conversion; and
(i) each request for a continuation as, or conversion to, a
Eurodollar Loan which fails to state an applicable Interest Period shall be
deemed to be a request for an Interest Period of one month.
Subject to the foregoing, in the event that the Borrower shall not give notice
to continue or convert any Eurodollar Loan as provided above, such Loan (unless
repaid) shall automatically be converted to a Base Rate Loan at the expiration
of the then current Interest Period. The Administrative Agent shall, after it
receives notice from the Borrower, promptly give the Lenders notice of any
continuation or conversion.
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SECTION 2.15 Reimbursement of Lenders. (a) The Borrower shall
reimburse each Lender on demand for any loss (excluding any loss of Applicable
Interest Margin) incurred or to be incurred by such Lender in the re-employment
of the funds released (i) by any prepayment or conversion (for any reason
whatsoever) of a Eurodollar Loan if such Loan is prepaid or converted prior to
the last day of the Interest Period for such Loan or (ii) in the event that
after the Borrower delivers a notice of borrowing under Section 2.3 or notice of
continuation or conversion under Section 2.14 in respect of a Eurodollar Loan,
such Loan is not made, continued or converted on the first day of the Interest
Period specified in the applicable notice for any reason other than (I) a
suspension or limitation under Section 2.13(b) of the right of the Borrower to
select a Eurodollar Loan or (II) a breach by such Lender of its obligation to
fund such Borrowing when it was otherwise required to do so hereunder. Such loss
shall be the amount as reasonably determined by such Lender as the excess, if
any, of (A) the amount of interest which would have accrued to such Lender on
the amount so paid or not borrowed, continued or converted at a rate of interest
equal to the interest rate applicable to such Loan pursuant to Section 2.7
hereof, for the period from the date of such payment or failure to borrow,
continue or convert to the last day (excluding the Applicable Interest Margin)
(x) in the case of a payment prior to the last day of the Interest Period for
such Loan, of the then current Interest Period for such Loan, or (y) in the case
of a failure to borrow, continue or convert, of the Interest Period for such
Loan which would have commenced on the date of such failure to borrow, continue
or convert, over (B) the amount realized by such Lender in re-employing the
funds not advanced or the funds received in prepayment or realized from the Loan
not so continued or converted during the period referred to above. Each Lender
shall deliver to the Borrower and to the Administrative Agent from time to time
one or more certificates setting forth the amount of such loss (and in
reasonable detail the manner of computation thereof) as determined by such
Lender, which certificates shall be conclusive absent manifest error. The
Borrower shall pay such Lender the amounts shown on such certificate within ten
(10) days of the Borrower's receipt of such certificate.
(b) In the event the Borrower fails to prepay any Loan on the
date specified in any prepayment notice delivered pursuant to Section 2.10, the
Borrower on demand by any Lender, shall pay to the Administrative Agent for the
account of such Lender any amounts required to compensate such Lender for any
actual loss incurred by such Lender as a result of such failure to prepay,
including, without limitation, any loss, cost or expenses incurred by reason of
the acquisition of deposits or other funds by such Lender to fulfill obligations
incurred in anticipation of such prepayment. Each Lender shall deliver to the
Borrower and to the Administrative Agent from time to time one or more
certificates setting forth the amount of such loss (and in reasonable detail the
manner of computation thereof) as determined by such Lender, which certificates
shall be conclusive absent manifest error. The Borrower shall pay the
Administrative Agent for the account of such Lender the amounts shown on such
certificate within ten (10) days of the Borrower's receipt of such certificate.
41
SECTION 2.16 Change in Circumstances. (a) In the event that
after the Initial Date, any change in Applicable Law or in the interpretation or
administration thereof (including, without limitation, any request, guideline or
policy not having the force of law) by any Governmental Authority charged with
the administration or interpretation thereof or, with respect to clauses (ii),
(iii) or (iv) below any changes in conditions, shall occur which shall:
(i) subject any Lender to, or increase the net amount of, any
tax, levy, impost, duty, charge, fee, deduction or withholding with
respect to any Eurodollar Loan (other than withholding tax imposed by
the United States of America or any political subdivision or taxing
authority thereof or therein or any other tax, levy, impost, duty,
charge, fee, deduction or withholding (x) that is measured with respect
to the overall net income of such Lender or of a Lending Office of such
Lender, and that is imposed by the United States of America, or by the
jurisdiction in which such Lender or Lending Office is incorporated, in
which such Lending Office is located, managed or controlled or in which
such Lender has its principal office or a presence not otherwise
connected with, or required by, this transaction (or any political
subdivision or taxing authority thereof or therein), or (y) that is
imposed solely by reason of any Lender failing to make a declaration
of, or otherwise to establish, nonresidence, or to make any other claim
for exemption, or otherwise to comply with any certification,
identification, information, documentation or reporting requirements
prescribed under the laws of the relevant jurisdiction, in those cases
where a Lender may properly make such declaration or claim or so
establish nonresidence or otherwise comply); or
(ii) change the basis of taxation of any payment to any Lender
of principal of or interest on any Eurodollar Loan or other fees and
amounts payable to any Lender hereunder, or any combination of the
foregoing, other than withholding tax imposed by the United States of
America or any political subdivision or taxing authority thereof or
therein or any other tax, levy, impost, duty, charge, fee, deduction or
withholding that is measured with respect to the overall net income of
such Lender or of a Lending Office of such Lender, and that is imposed
by the United States of America, or by the jurisdiction in which such
Lender or Lending Office is incorporated, in which such Lending Office
is located, managed or controlled or in which such Lender has its
principal office or a presence not otherwise connected with, or
required by, this transaction (or any political subdivision or taxing
authority thereof or therein); or
(iii) impose, modify or deem applicable any reserve, deposit
or similar requirement against any assets held by, deposits with or for
the account of, or loans or commitments by, an office of such Lender
with respect to any Eurodollar Loan; or
(iv) impose upon such Lender or the London Interbank Market
any other condition with respect to the Eurodollar Loans or this Credit
Agreement;
and the result of any of the foregoing shall be to increase the actual cost to
such Lender of making or maintaining any Eurodollar Loan hereunder or to reduce
the amount of any payment (whether of principal, interest or otherwise) received
or receivable by such Lender in connection with any Eurodollar Loan hereunder,
or to require such Lender to make any payment in connection with any Eurodollar
Loan hereunder, in each case by or in an amount which such Lender in its sole
judgment shall deem material, then and in each case, the Borrower agrees to pay
to the Administrative Agent for the account of such Lender, in accordance with,
and as provided in, paragraph (c) below, such amounts as shall be necessary to
compensate such Lender for such cost, reduction or payment.
42
(b) If at any time and from time to time after the Initial
Date, any Lender shall have determined that the applicability of any law, rule,
regulation or guideline regarding capital adequacy which is adopted after the
Initial Date, or any change in any law, rule, regulation or guideline regarding
capital adequacy or in the interpretation or administration of any of the
foregoing by any Governmental Authority, central bank or comparable agency
charged with the interpretation or administration thereof, or the compliance by
any Lender (or any Lending Office of such Lender) or any Lender's holding
company with any request or directive issued after the Initial Date regarding
capital adequacy (whether or not having the force of law) of any such authority,
central bank or comparable agency, has or would have the effect of reducing the
rate of return on such Lender's capital or on the capital of such Lender's
holding company, if any, as a consequence of this Credit Agreement or the Loans
made or Letters of Credit issued pursuant hereto to a level below that which
such Lender or such Lender's holding company could have achieved but for such
applicability, adoption, change or compliance (taking into consideration such
Lender's policies and the policies of such Lender's holding company with respect
to capital adequacy) by an amount deemed by such Lender in its sole judgment to
be material, then from time to time the Borrower agrees to pay to the
Administrative Agent for the account of such Lender, in accordance with, and as
provided in, paragraph (c) below, such additional amount or amounts as will
compensate such Lender or such Lender's holding company for any such reduction
suffered to the extent attributable to this Credit Agreement or the Loans made
or Letters of Credit issued pursuant hereto.
(c) Each Lender shall deliver to the Borrower and to the
Administrative Agent from time to time one or more certificates setting forth
the amounts due to such Lender under paragraph (a) or (b) above, the changes as
a result of which such amounts are due and the manner of computing such amounts.
Each such certificate shall be conclusive in the absence of manifest error. The
Borrower shall pay to the Administrative Agent for the account of each such
Lender the amounts shown as due on any such certificate within ten (10) days
after the Borrower's receipt of the same. No failure on the part of any Lender
to demand compensation under paragraph (a) or (b) above on any one occasion
shall constitute a waiver of its right to demand such compensation on any other
occasion. The protection of this Section 2.16 shall be available to each Lender
regardless of any possible contention of the invalidity or inapplicability of
any law, regulation or other condition which shall give rise to any demand by
such Lender for compensation hereunder.
(d) Each Lender agrees that after it becomes aware of the
occurrence of an event or the existence of a condition that (i) would cause it
to incur any increased cost hereunder or render it unable to perform its
agreements hereunder for the reasons specifically set forth in Section 2.13(b),
this Section 2.16, Section 2.17 or Section 2.21(g) or (ii) would require the
Borrower to pay an increased amount under Section 2.13(b), this Section 2.16,
Section 2.17 or Section 2.21(g), it will use reasonable efforts to notify the
Borrower in writing of such event or condition and, to the extent not
inconsistent with such Lender's internal policies, will use its reasonable
efforts to make, fund or maintain the affected Loans of such Lender, or if
applicable, participate in Letters of Credit as required by Section 2.21,
through another Lending Office of such Lender if as a result thereof the
additional monies which would otherwise be required to be paid or the reduction
of amounts receivable by such Lender hereunder in respect of such Loans, Letters
of Credit or participations therein would be materially reduced, or such
inability to perform would cease to exist, or the increased costs which would
otherwise be required to be paid in respect of such Loans, Letters of Credit or
participations pursuant to Section 2.13(b), this Section 2.16, Section 2.17 or
Section 2.21 would be materially reduced or the taxes or other amounts otherwise
payable under Section 2.13(b), this Section 2.16, Section 2.17 or Section 2.21
would be materially reduced, and if, as determined by such Lender, in its sole
discretion, the making, funding or maintaining of such Loans, Letters of Credit
or participations therein through such other Lending Office would not otherwise
materially adversely affect such Loans, Letters of Credit or participations
therein or such Lender.
43
(e) If the Borrower shall receive notice from any Lender that
Eurodollar Loans are no longer available from such Lender pursuant to Section
2.17, that amounts are due to such Lender pursuant to subparagraph (c) hereof,
that any of the events designated in subparagraph (d) hereof have occurred, or
that an event has occurred that would cause the Borrower to pay any amount
pursuant to clause (c) of Section 2.18, the Borrower may (but subject in any
such case to the payments required by this Credit Agreement, including, without
limitation Section 2.15 hereof), upon at least five (5) Business Days' prior
written or facsimile notice to such Lender and the Administrative Agent, but not
more than thirty (30) days after receipt of notice from such Lender, identify to
the Administrative Agent a lending institution ("Purchasing Lender") reasonably
acceptable to the Borrower and the Administrative Agent (and that qualifies as
an Eligible Assignee), which will purchase (for an amount, in immediately
available funds, equal to the principal amount of outstanding Loans payable to
such Lender, plus all accrued but unpaid interest and fees payable to such
Lender) the Commitments (if applicable), the amount of outstanding Loans and
participations in Letters of Credit (if applicable), from the Lender providing
such notice, and such Lender shall thereupon assign its Commitments (if
applicable), its participations in Letters of Credit (if applicable) and any
Loans owing to such Lender, and any notes held by such Lender to such Purchasing
Lender pursuant to Section 13.3 hereof.
SECTION 2.17 Change in Legality. (a) Notwithstanding anything
to the contrary contained elsewhere in this Credit Agreement, if any change
after the date hereof in Applicable Law, guideline or order, or in the
interpretation thereof by any Governmental Authority charged with the
administration thereof, shall make it unlawful for any Lender to make or
maintain any Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to a Eurodollar Loan, then, by written notice
to the Borrower and the Administrative Agent, such Lender may (i) declare that
Eurodollar Loans will not thereafter be made by such Lender hereunder and/or
(ii) require that, subject to Section 2.15, all outstanding Eurodollar Loans
made by it be converted to Base Rate Loans, whereupon all of such Eurodollar
Loans shall automatically be converted to Base Rate Loans, as of the effective
date of such notice as provided in paragraph (b) below. Such Lender's pro rata
portion of any subsequent Eurodollar Loan shall, instead, be a Base Rate Loan
unless such declaration is subsequently withdrawn.
(b) A notice to the Borrower by any Lender pursuant to
paragraph (a) above shall be effective for purposes of clause (ii) thereof, if
lawful, on the last day of the current Interest Period for each outstanding
Eurodollar Loan; and in all other cases, on the date of receipt of such notice
by the Borrower.
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▇▇▇▇▇▇▇ ▇.▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Withholding. (a) Prior to the
Closing Date, and prior to the effective date set forth in the Assignment and
Acceptance with respect to any Lender becoming a Lender after the date hereof,
and from time to time thereafter if requested by the Borrower or the
Administrative Agent or required because, as a result of a change in law or a
change in circumstances or otherwise, a previously delivered form or statement
becomes incomplete or incorrect in any material respect, each Lender shall
provide, if applicable, the Administrative Agent and the Borrower with two (2)
complete, accurate and duly executed original Forms ▇-▇, ▇-▇▇▇▇ or W-8ECI or
other statements prescribed by the Internal Revenue Service of the United States
certifying such Lender's exemption from, or entitlement to a reduced rate of,
United States withholding taxes (including backup withholding taxes) with
respect to all payments to be made to such Lender hereunder and under any other
Fundamental Document. In addition, in those circumstances as shall be necessary
to allow payments hereunder to be made free of (or at a reduced rate of)
withholding tax, the Administrative Agent (or any successor agent) shall provide
the Borrower with two (2) complete, accurate and duly executed original Forms
W-8IMY or other applicable statements prescribed by the Internal Revenue Service
of the United States.
(b) The Borrower or the Administrative Agent shall be entitled
to deduct and withhold any and all present or future taxes or withholdings, and
all liabilities with respect thereto, from payments to a Lender hereunder or
under any other Fundamental Document, if and to the extent that the Borrower or
the Administrative Agent in good faith determines that such deduction or
withholding is required by the law of the United States, including, without
limitation, any applicable treaty of the United States. In the event the
Borrower or the Administrative Agent shall so determine that deduction or
withholding of taxes is required, it shall advise the affected Lender as to the
basis of such determination prior to actually deducting and withholding such
taxes. In the event the Borrower or the Administrative Agent shall so deduct or
withhold taxes from amounts payable hereunder, it (i) shall pay to, or deposit
with, the appropriate taxing authority in a timely manner the full amount of
taxes it has deducted or withheld; (ii) shall provide to each Lender from whom
taxes were deducted or withheld, evidence of payment of such taxes to, or the
deposit thereof with, the appropriate taxing authority and a statement setting
forth the amount of taxes deducted or withheld, the applicable rate, and any
other information or documentation reasonably requested by such Lender; and
(iii) shall forward to each such Lender any official tax receipts or other
documentation with respect to the payment or deposit of the deducted or withheld
taxes as may be issued from time to time by the appropriate taxing authority.
Unless the Borrower and the Administrative Agent have received forms or other
documents as required by Section 2.18(a) that are satisfactory to them
indicating that payments hereunder or under any note evidencing the Loans
hereunder are not subject to United States withholding tax or are subject to
such tax at a rate reduced by an applicable tax treaty, the Borrower or the
Administrative Agent may withhold taxes from such payments at the applicable
statutory rate in the case of payments to or for any Lender.
(c) Each Lender agrees (i) that as between it and the Borrower
or the Administrative Agent, such Lender shall be the Person to deduct and
withhold taxes, and to the extent required by law, it shall deduct and withhold
taxes on amounts that such Lender may remit to any other Person(s) by reason of
any undisclosed transfer or assignment of an interest in this Credit Agreement
to such other Person(s) pursuant to Section 13.3; and (ii) to indemnify the
Borrower and the Administrative Agent and any officers, directors, partners,
limited liability company members, agents, employees or representatives of the
Borrower or the Administrative Agent against, and to hold them harmless from,
any tax, interest, additions to tax, penalties, reasonable counsel and
accountants' fees, disbursements or payments arising from the assertion by any
appropriate taxing authority of any claim against them relating to a failure to
withhold taxes as required by law with respect to amounts described in clause
(i) of this paragraph (c) or arising from the reliance by the Borrower or the
Administrative Agent on any form or other document furnished by such Lender and
purporting to establish a basis for not withholding, or for withholding at a
reduced rate, taxes with respect to payments hereunder or under any other
Fundamental Document.
45
(d) Each assignee of a Lender's interest in this Credit
Agreement in conformity with Section 13.3 shall be bound by this Section 2.18,
so that such assignee will have all of the obligations and provide all of the
forms and statements and all indemnities, representations and warranties
required to be given under this Section 2.18.
(e) Notwithstanding the foregoing, in the event that any
withholding taxes shall become payable solely as a result of any change in any
statute, treaty, ruling, determination or regulation occurring after the Initial
Date in respect of any sum payable hereunder or under any other Fundamental
Document to any Lender or any of the Agents (i) the sum payable by the Borrower
shall be increased as may be necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section 2.18) such Lender or the applicable Agent (as the case may be)
receives an amount equal to the sum it would have received had no such
withholding deductions been made, (ii) the Borrower shall make such deductions,
(iii) the Borrower shall pay the full amount deducted to the relevant taxation
authority or other authority in accordance with Applicable Law and (iv) the
Borrower shall forward to such Lender or the applicable Agent (as the case may
be) the official tax receipts or other documentation pursuant to and as set
forth in Section 2.18(b). In addition, the Borrower shall indemnify each Lender
and each of the Agents for any additional withholding taxes paid by such Lender
or such Agent, as the case may be, or any liability (including penalties and
interest) arising therefrom or with respect thereto, whether or not such
additional withholding taxes were correctly or legally asserted.
(f) In the event that a Lender or an Agent receives a refund
of or credit for taxes withheld or paid pursuant to this Section 2.18, which
credit, refund, deduction, or other tax benefit is identifiable by such Lender
or such Agent (as applicable) as being a result of taxes withheld or paid in
connection with sums payable hereunder or under any other Fundamental Document,
such Lender or such Agent (as applicable) shall promptly notify the
Administrative Agent and the Borrower and shall remit to the Borrower the amount
of such refund, credit, deduction, or other tax benefit allocable to payments
made hereunder or under any other Fundamental Document.
(g) Each Lender agrees that after it becomes aware of the
occurrence of an event that would cause the Borrower to pay any amount pursuant
to clause (e) of this Section 2.18, it will use reasonable efforts to notify the
Borrower of such event and, to the extent not inconsistent with such Lender's
internal policies, will use its reasonable efforts to make, fund or maintain the
affected Loans of such Lender through another Lending Office of such Lender if
as a result thereof the additional monies which would otherwise be required to
be paid by reason of Section 2.18(e) in respect of such Loans would be
materially reduced, and if, as determined by such Lender, in its discretion, the
making, funding or maintaining of such Loans through such other Lending Office
would not otherwise materially adversely affect such Loans or such Lender.
46
(h) For any period with respect to which a Lender has failed
to provide the Borrower with the appropriate forms pursuant to Section 2.18(a)
(unless such failure is due to a change in treaty, law or regulation occurring
subsequent to the date on which a form originally was required to be provided),
such Lender shall not be entitled to indemnification under Section 2.18(e);
provided, however, that should a Lender, which is otherwise exempt from or
subject to a reduced rate of withholding tax, become subject to taxes because of
its failure to deliver a form required hereunder, the Borrower shall take such
steps as such Lender shall reasonably request to assist such Lender to recover
such taxes.
SECTION 2.19 Interest Adjustments. If the provisions of this
Credit Agreement or any note evidencing any of the Loans hereunder would at any
time require payment by the Borrower to a Lender of any amount of interest in
excess of the maximum amount then permitted by the law applicable to any Loan,
the applicable interest payments to that Lender in connection with such Loan
shall be reduced to the extent and in such a manner as is necessary in order
that such Lender shall not receive interest in excess of such maximum amount.
If, as a result of the foregoing, a Lender shall receive interest payments
hereunder with respect to a Loan or under a note evidencing such Loan in an
amount less than the amount otherwise provided hereunder, such deficit
(hereinafter called the "Interest Deficit") will, to the fullest extent
permitted by Applicable Law, cumulate and will be carried forward (without
interest) until the Facility Termination Date (except to the extent paid
pursuant to the immediately succeeding sentence). Interest otherwise payable to
a Lender hereunder with respect to such Loan and under any note evidencing such
Loan for any subsequent period shall be increased by the maximum amount of the
Interest Deficit that may be so added without causing such Lender to receive
interest in excess of the maximum amount then permitted by Applicable Law.
The amount of any Interest Deficit relating to any Loan and
any note evidencing such Loan shall be treated as a prepayment premium and
shall, to the fullest extent permitted by Applicable Law, be paid in full at the
time of any optional prepayment by the Borrower to the Lenders of all the Loans
within the applicable Tranche at that time outstanding pursuant to Section 2.10
hereof. The amount of any Interest Deficit relating to a Loan and any note at
the time of any complete payment of the Loans within the applicable Tranche at
that time outstanding (other than an optional prepayment thereof pursuant to
Section 2.10 hereof) shall be canceled and not paid.
SECTION 2.20 Manner of Payments. Except as provided in Section
2.11(h) hereof, all payments of principal and interest by the Borrower in
respect of any Loans shall be allocated pro rata among the Lenders holding such
Loans in accordance with the then outstanding principal amounts of such Loans
held by them. All payments by the Borrower hereunder and under any notes
evidencing the Loans hereunder shall be made without offset, counterclaim,
recoupment, defense, setoff or other deduction in Dollars, in Federal or other
immediately available funds, at the office of the Administrative Agent, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Syndication Agency
Services, for credit to Genesis HealthCare Corporation, no later than 1:00
p.m.(Eastern time), on the date on which such payment shall be due (except for
payments to be made directly to the Issuing Bank or the Swingline Lender as
expressly provided herein). Any payment received at such office after such time
shall be deemed received on the following Business Day. The Administrative Agent
shall distribute any payment received by it for the account of any Lender to
such Lender promptly following receipt thereof.
47
SECTION 2.21 Letters of Credit. (a) (i) Upon the terms and
subject to the conditions hereof and of Applicable Law, the Issuing Bank agrees,
upon the request of the Borrower, to issue Letters of Credit (and to extend
Letters of Credit previously issued hereunder) payable in Dollars from time to
time after the Closing Date and prior to the Revolving Credit Commitment
Termination Date; provided, however, that (A) the Borrower shall not request,
and the Issuing Bank shall not issue, any Letter of Credit if, after giving
effect thereto, the sum of the then current L/C Exposure, plus the aggregate
principal amount of all Revolving Credit Loans then outstanding, plus the
aggregate principal amount of all Swingline Loans then outstanding would exceed
the Total Revolving Credit Commitment, (B) the Borrower shall not request, and
the Issuing Bank shall not issue, any Letter of Credit having an expiration date
(x) later than the tenth day prior to the Revolving Credit Commitment
Termination Date or (y) more than one year after its date of issuance or
extension; provided, however, that a Letter of Credit may, if requested by the
Borrower, provide that such Letter of Credit is renewable for successive periods
of one year or less, unless the Issuing Bank shall have delivered a notice of
non-renewal to the beneficiary of such Letter of Credit and (C) the Borrower
shall not request, and the Issuing Bank shall not issue, any Letter of Credit
if, after giving effect thereto, the then current L/C Exposure with respect to
Letters of Credit would exceed $15,000,000.
(ii) Immediately upon the issuance of each Letter of Credit,
each Revolving Credit Lender shall be deemed to, and hereby agrees to,
have irrevocably purchased from the Issuing Bank a participation in
such Letter of Credit in accordance with such Revolving Credit Lender's
Percentage of the Total Revolving Credit Commitment.
(iii) Each Letter of Credit may, at the option of the Issuing
Bank, provide that the Issuing Bank may (but shall not be required to)
pay all or any part of the maximum amount which may at any time be
available for drawing thereunder to the beneficiary thereof upon the
occurrence or continuation of an Event of Default and the acceleration
of the maturity of the Loans; provided, that, if payment is not then
due to the beneficiary, the Issuing Bank shall deposit the funds in
question in a segregated account with the Issuing Bank to secure
payment to the beneficiary and any funds so deposited shall be paid to
the beneficiary of the Letter of Credit if conditions to such payment
are satisfied or returned to the Issuing Bank for distribution to the
Revolving Credit Lenders (or, if all Obligations shall have been
indefeasibly paid in full in cash, to the Borrower) if no payment to
the beneficiary has been made and the final date available for drawings
under the Letter of Credit has passed. Each payment or deposit of funds
by the Issuing Bank as provided in this paragraph shall be treated for
all purposes of this Credit Agreement as a drawing duly honored by such
Issuing Bank under the related Letter of Credit.
48
(b) Whenever the Borrower desires the issuance of a Letter of
Credit, it shall deliver to the Administrative Agent and the Issuing Bank a
written notice no later than 1:00 p.m. (Eastern time) at least two (2) Business
Days prior to the proposed date of issuance (or such lesser time as is
acceptable to the Issuing Bank). Such notice shall specify (i) the proposed date
of issuance (which shall be a Business Day), (ii) the face amount of the Letter
of Credit, (iii) the expiration date of the Letter of Credit and (iv) the name
and address of the beneficiary. Such notice shall be accompanied by a brief
description of the underlying transaction and upon request of the Issuing Bank
or the Administrative Agent, the Borrower shall provide additional details
regarding the underlying transaction. Concurrently with the giving of written
notice of a request for the issuance of a Letter of Credit, the Borrower shall
specify a precise description of the documents and the verbatim text of any
certificate to be presented by the beneficiary of such Letter of Credit which,
if presented by such beneficiary prior to the expiration date of the Letter of
Credit, would require the Issuing Bank to make payment under the Letter of
Credit; provided, however, that the Issuing Bank, in its reasonable discretion,
may require customary changes in any such documents and certificates to be
presented by the beneficiary. Any Letter of Credit shall be issued solely for
one of the following purposes: (1) to provide credit support for the Borrower's
obligations under and pursuant to a Hedging Agreement in accordance with the
terms of the applicable Hedging Agreement, (2) to provide credit support for
indemnity obligations of a Credit Party or Subsidiary thereof in connection with
the sale or lease of an asset permitted hereunder (provided, that the applicable
indemnity obligation is not prohibited by the terms of this Credit Agreement),
(3) in connection with a Permitted Lien or (4) for such other purpose as has
been approved by the Administrative Agent and the Issuing Bank. Upon issuance of
each Letter of Credit, the Issuing Bank shall notify the Administrative Agent of
the issuance of such Letter of Credit. Promptly after receipt of such notice,
the Administrative Agent shall notify each Revolving Credit Lender of the
issuance and the amount of such Revolving Credit Lender's respective
participation in the applicable Letter of Credit.
(c) Each Letter of Credit shall be subject to (i) the Uniform
Customs and Practice for Documentary Credits, International Chamber of Commerce
Publication No. 500, or any successor publication, as adopted or amended from
time to time (the "Uniform Customs") and (ii) as to matters not addressed by the
Uniform Customs, the law of the State of New York (or, if the Issuing Bank so
elects, the law of the jurisdiction in which the office from which it issues its
Letters of Credit is located). The Issuing Bank shall be entitled to honor any
drafts and accept any documents presented to it by the beneficiary of such
Letter of Credit in accordance with the terms of such Letter of Credit and
believed by the Issuing Bank in good faith to be genuine. The Issuing Bank shall
not have any duty to inquire as to the accuracy or authenticity of any draft or
other drawing documents which may be presented to it, but shall be responsible
only to determine in accordance with customary commercial practices that the
documents which are required to be presented before payment or acceptance of a
draft under any Letter of Credit have been delivered and that they comply on
their face with the requirements of such Letter of Credit.
(d) If the Issuing Bank shall make payment on any draft
presented under a Letter of Credit (regardless of whether a Default, Event of
Default or acceleration has occurred), the Issuing Bank shall give notice of
such payment to the Administrative Agent and the Revolving Credit Lenders, and
each Revolving Credit Lender hereby authorizes and requests the Issuing Bank to
advance for its account, pursuant to the terms hereof, its share of such payment
based upon its participation in the Letter of Credit and agrees promptly to
reimburse the Issuing Bank in immediately available funds in Dollars for the
amount so advanced on its behalf by the Issuing Bank. If any such reimbursement
is not made by any Revolving Credit Lender in immediately available funds on the
same day on which the Issuing Bank shall have made payment on any such draft,
such Revolving Credit Lender shall pay interest thereon to the Issuing Bank at a
rate per annum equal to the Issuing Bank's cost of obtaining overnight funds in
the Federal Funds market for the first three (3) days following the time when
such Revolving Credit Lender fails to make the required reimbursement, and
thereafter at a rate per annum equal to the Base Rate plus the Applicable
Interest Margin for Base Rate Loans which are Revolving Credit Loans.
49
(e) The Borrower is absolutely, unconditionally and
irrevocably obligated to reimburse all amounts drawn under each Letter of
Credit. If any draft is presented under a Letter of Credit, the payment of which
is required to be made at any time on or before the Revolving Credit Commitment
Termination Date, then payment by the Issuing Bank of such draft shall
constitute a Revolving Credit Loan (which is a Base Rate Loan) hereunder and
interest shall accrue from the date the Issuing Bank makes payment on such draft
under such Letter of Credit. If any draft is presented under a Letter of Credit,
the payment of which is required to be made after the Revolving Credit
Commitment Termination Date or at the time when an Event of Default or Default
shall have occurred and then be continuing, then the Borrower shall immediately
pay to the Issuing Bank, in immediately available funds, the full amount of such
draft together with interest thereon at a rate per annum of 2% in excess of the
rate then in effect for Revolving Credit Loans which are Base Rate Loans from
the date on which the Issuing Bank makes such payment of such draft until the
date it receives full reimbursement for such payment from the Borrower. The
Borrower further agrees that the Issuing Bank may reimburse itself for such
drawing from the balance in any other account of the Borrower maintained with
the Issuing Bank.
(f) (i) The Borrower agrees to pay the following amounts to
the Issuing Bank with respect to Letters of Credit issued by it hereunder:
(A) with respect to the issuance, amendment, transfer
or other transaction related to a Letter of Credit and each
drawing made thereunder, documentary and processing charges in
accordance with the Issuing Bank's standard schedule for such
charges in effect at the time of such issuance, amendment,
transfer, drawing or other transaction, as the case may be;
and
(B) a fronting fee payable directly to the Issuing
Bank, for its sole account, for the period from and including
the Closing Date to, but excluding, the Revolving Credit
Commitment Termination Date computed at a rate equal to
one-quarter of one percent (1/8 of 1%) per annum of the daily
average L/C Exposure (calculated in the same manner as
interest on a Eurodollar Loan), such fee to be due and payable
in arrears on and through the last Business Day of each March,
June, September and December in each year (commencing on the
last Business Day of December 2003) prior to the Revolving
Credit Commitment Termination Date or the expiration of the
last outstanding Letter of Credit (whichever is later) and on
the later of the Revolving Credit Commitment Termination Date
and the expiration of the last outstanding Letter of Credit.
50
(ii) The Borrower agrees to pay to the Administrative Agent
for distribution to each Revolving Credit Lender in respect of its L/C
Exposure, such Revolving Credit Lender's pro rata share (based on its
Revolving Credit Commitment) of a commission equal to (A) a per annum
percentage rate equal to the Applicable Interest Margin for Revolving
Credit Loans which are Eurodollar Loans multiplied by (B) the average
daily amount of the L/C Exposure. Such commission shall be calculated
in the same manner as interest on a Eurodollar Loan and shall be due
and payable in arrears on and through the last Business Day of each
March, June, September and December (commencing the last Business Day
of December 2003) prior to the Revolving Credit Commitment Termination
Date or the expiration of the last outstanding Letter of Credit
(whichever is later) and on the later of the Revolving Credit
Commitment Termination Date and the expiration of the last outstanding
Letter of Credit. From the occurrence and during the continuance, of an
Event of Default, such commission shall be increased to an amount equal
to 2% plus the Applicable Interest Margin for Revolving Credit Loans
which are Eurodollar Loans multiplied by the daily average amount of
the L/C Exposure; and
(iii) Promptly upon receipt by the Issuing Bank or the
Administrative Agent of any amount described in clause (ii) of this
Section 2.21(f), or any amount described in Section 2.21(e) previously
reimbursed to the Issuing Bank by the Revolving Credit Lenders, the
Issuing Bank or the Administrative Agent (as applicable) shall
distribute to each Revolving Credit Lender its pro rata share of such
amount based on its participation in, or amount paid by such Revolving
Credit Lender with respect to, the applicable Letter(s) of Credit.
Amounts payable under clauses (i)(A) and (i)(B) of this Section 2.21(f)
shall be paid directly to the Issuing Bank and shall be for its
exclusive use.
(g) If by reason of (i) any change in Applicable Law after the
Initial Date, or in the interpretation or administration thereof (including,
without limitation, any request, guideline or policy not having the force of
law) by any Governmental Authority charged with the administration or
interpretation thereof, or (ii) compliance by the Issuing Bank or any Revolving
Credit Lender with any direction, request or requirement (whether or not having
the force of law) issued after the Initial Date by any Governmental Authority or
monetary authority, including, without limitation, any change whether or not
proposed or published prior to the Initial Date and any modifications to
Regulation D occurring after the Initial Date:
(A) the Issuing Bank or any Revolving Credit Lender
shall be subject to any tax, levy, impost, duty, fee, charge,
deduction or withholding of any nature with respect to any
Letter of Credit (other than withholding tax imposed by the
United States of America or any other tax, levy, impost, duty,
fee, charge, deduction or withholding (1) that is measured
with respect to the overall net income of the Issuing Bank or
such Revolving Credit Lender or of a Lending Office of the
Issuing Bank or such Revolving Credit Lender, and that is
imposed by the United States of America, or by the
jurisdiction in which the Issuing Bank or such Revolving
Credit Lender is incorporated, or in which such Lending Office
is located, managed or controlled or in which the Issuing Bank
or such Revolving Credit Lender has its principal office or a
presence which is not otherwise connected with, or required
by, this transaction (or any political subdivision or taxing
authority thereof or therein) or (2) that is imposed solely by
reason of the Issuing Bank or such Revolving Credit Lender
failing to make a declaration of, or otherwise to establish,
nonresidence or to make any other claim for exemption, or
otherwise to comply with any certification, identification,
information, documentation or reporting requirements
prescribed under the laws of the relevant jurisdiction, in
those cases where the Issuing Bank or such Revolving Credit
Lender may properly make the declaration or claim or so
establish nonresidence or otherwise comply), or to any
variation thereof or to any penalty with respect to the
maintenance or fulfillment of its obligations under this
Section 2.21, whether directly or by such being imposed on or
suffered by the Issuing Bank or any Revolving Credit Lender;
51
(B) the basis of taxation of any fee or amount
payable hereunder with respect to any Letter of Credit or any
participation therein shall be changed;
(C) any reserve, deposit or similar requirement is or
shall be applicable, imposed or modified in respect of any
Letter of Credit issued by the Issuing Bank or participations
therein purchased by any Revolving Credit Lender; or
(D) there shall be imposed on the Issuing Bank or any
Revolving Credit Lender any other condition regarding this
Section 2.21, any Letter of Credit or any participation
therein;
and the result of the foregoing is to directly or indirectly increase from the
conditions that exist on the Initial Date the cost to the Issuing Bank or any
Lender of issuing, making or maintaining any Letter of Credit or of purchasing
or maintaining any participation therein, or to reduce the amount receivable in
respect thereof by the Issuing Bank or any Lender, then and in any such case the
Issuing Bank or such Lender may, at any time, notify the Borrower, and the
Borrower shall pay on demand such amounts as the Issuing Bank or such Lender may
specify to be necessary to compensate the Issuing Bank or such Lender for such
additional cost or reduced receipt. Sections 2.16(b), (c) and (d) shall in all
instances apply to the Issuing Bank and any Lender with respect to the Letters
of Credit issued hereunder. The determination by the Issuing Bank or any Lender,
as the case may be, of any amount due pursuant to this Section 2.21 as set forth
in a certificate setting forth the calculation thereof in reasonable detail
shall, in the absence of manifest error, be final, conclusive and binding on all
of the parties hereto.
(h) If at any time when an Event of Default shall have
occurred and be continuing, any Letters of Credit shall remain outstanding, then
the Issuing Bank may, and if directed by the Required Revolving Credit Lenders
shall, require the Borrower to deliver to the Administrative Agent cash or Cash
Equivalents in an amount equal to 105% of the amount of the L/C Exposure or to
furnish other security acceptable to the Issuing Bank and the Required Revolving
Credit Lenders. Any amounts so delivered pursuant to the preceding sentence
shall be applied to reimburse the Issuing Bank for the amount of any drawings
honored under Letters of Credit and any costs associated with the Letters of
Credit; provided, however, that if prior to the Revolving Credit Commitment
Termination Date, (i) no Default or Event of Default is then continuing, then
the Administrative Agent shall return all of such collateral relating to such
deposit to the Borrower if requested by it or (ii) Letters of Credit shall
expire or be returned by the beneficiary so that the amount of the cash or Cash
Equivalents delivered to the Administrative Agent hereunder shall exceed 105% of
the then current L/C Exposure, then such excess shall first be applied to pay
any Obligations owing to the Revolving Credit Lenders under this Credit
Agreement and the remainder shall be returned to the Borrower.
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(i) Notwithstanding the termination of the Revolving Credit
Commitments and the payment of the Revolving Credit Loans, the obligations of
the Borrower under this Section 2.21 shall remain in full force and effect until
the Administrative Agent, the Issuing Bank and the Revolving Credit Lenders
shall have been irrevocably released from their obligations with regard to any
and all Letters of Credit.
(j) The obligations of the Borrower to reimburse the Issuing
Bank and the Revolving Credit Lenders for drawings made under any Letter of
Credit shall be unconditional and irrevocable and shall be paid strictly in
accordance with the terms of this Credit Agreement under all circumstances,
including, without limitation: (i) any lack of validity or enforceability of any
Letter of Credit; (ii) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against a beneficiary of any
Letter of Credit or against the Issuing Bank or any of the Revolving Credit
Lenders, whether in connection with this Credit Agreement, the transactions
contemplated herein or any unrelated transaction; (iii) payment by the Issuing
Bank against any draft, demand, certificate or other document presented under
any Letter of Credit which proves to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or inaccurate
in any respect; (iv) payment by the Issuing Bank of any Letter of Credit against
presentation of a demand, draft or certificate or other document which does not
comply with the terms of such Letter of Credit (including, without limitation,
payment by the Issuing Bank in accordance with its usual practices and
procedures, subsequent to the expiry date of a Letter of Credit, as long as the
Issuing Bank has obtained the consent of the Borrower thereto and has not been
notified in writing by the Administrative Agent or a Revolving Credit Lender of
the occurrence of the Revolving Credit Commitment Termination Date); (v) any
other circumstance or happening whatsoever, which is similar to any of the
foregoing; or (vi) the fact that any Event of Default shall have occurred and be
continuing (it being understood that any such payment by the Borrower shall be
without prejudice to, and shall not constitute a waiver of, any rights the
Borrower might have or might acquire against any party as a result of the
payment by the Issuing Bank of any draft or the reimbursement by the Borrower
thereof).
(k) The letters of credit issued by the Issuing Bank and
outstanding on the Closing Date which are listed on Schedule 2.21 hereto shall
for all purposes be deemed to be Letters of Credit issued hereunder on the
Closing Date.
3. REPRESENTATIONS AND WARRANTIES OF CREDIT PARTIES
In order to induce the Agents, the Issuing Bank and the
Lenders to enter into this Credit Agreement and to make Loans and to issue or
purchase participations in the Letters of Credit provided for herein, the Credit
Parties, jointly and severally, make the following representations and
warranties to, and agreements with, the Agents, the Issuing Bank and the
Lenders, all of which shall survive the execution and delivery of this Credit
Agreement, the issuance of any notes evidencing any of the Loans hereunder and
the making of the Loans and the issuance of the Letters of Credit:
53
SECTION 3.1 Existence and Power. (a) The Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of Pennsylvania and is qualified to do business and is in good standing in all
jurisdictions where (i) the nature of its properties or business so requires and
(ii) the failure to be in good standing could reasonably be expected to have a
Material Adverse Effect. Schedule 3.1(a) hereto sets forth a list of all
jurisdictions in which the Borrower is so qualified.
(b) Each other Credit Party is duly organized, validly
existing and in good standing under the laws of its jurisdiction of organization
and is qualified to do business and is in good standing in all jurisdictions
where (i) the nature of its properties or business so requires and (ii) the
failure to be in good standing could reasonably be expected to have a Material
Adverse Effect. Schedule 3.1(b) hereto also sets forth a list of the
jurisdiction of organization of each Credit Party and all jurisdictions in which
each Credit Party is qualified to do business.
(c) Each of the Credit Parties has the partnership, company or
corporate, as the case may be, power and authority (i) to own its respective
properties and carry on its respective business as now being, or as now intended
to be, conducted, (ii) to execute, deliver and perform, as applicable, its
obligations under the Fundamental Documents and any other documents contemplated
hereby or thereby to which it is or will be a party, and (iii) to grant to the
Administrative Agent, for the benefit of the Secured Parties, a security
interest in the Collateral and the Real Property Assets as contemplated by this
Credit Agreement and the other Fundamental Documents to which it is or will be a
party; and in the case of the Pledgors, to pledge to the Administrative Agent
for the benefit of the Secured Parties, the Pledged Collateral as contemplated
by Article 10 hereof; and in the case of the Borrower, to execute, deliver and
perform its obligations under this Credit Agreement and any notes evidencing any
of the Loans hereunder and to borrow hereunder; and in the case of the
Guarantors, to guaranty the Obligations as contemplated by Article 9 hereof.
SECTION 3.2 Authority and No Violation. The execution,
delivery and performance of this Credit Agreement and the other Fundamental
Documents to which it is a party, by each Credit Party, the grant to the
Administrative Agent for the benefit of the Secured Parties of the security
interest in the Collateral and the Real Property Assets as contemplated by this
Credit Agreement and the other Fundamental Documents to which it is or will be a
party, by each Credit Party, and the pledge to the Administrative Agent for the
benefit of the Secured Parties of the Pledged Collateral as contemplated by
Article 10 hereof, by each Pledgor and, in the case of the Borrower, the
Borrowings hereunder and the execution, delivery and performance of the notes
evidencing any of the Loans hereunder and, in the case of each Guarantor, the
guaranty of the Obligations as contemplated in Article 9 hereof, (i) have been
duly authorized by all necessary company, partnership or corporate (as
applicable) action on the part of each such Credit Party, (ii) will not
constitute a violation of any provision of Applicable Law or any order of any
Governmental Authority applicable to such Credit Party or any of its respective
properties or assets, (iii) will not violate any provision of the Certificate of
Incorporation, By-Laws, partnership agreement, limited liability company
agreement, articles of organization or any other organizational document of any
Credit Party, or any provision of any Regulatory License, Reimbursement
Approval, or material indenture, agreement, bond, note, mortgage, deed of trust,
or other similar instrument to which such Credit Party is a party or by which
such Credit Party or any of its respective properties or assets are bound or to
which such Credit Party is subject, (iv) will not be in conflict with, result in
a breach of, or constitute (with due notice or lapse of time or both) a default
under, or create any right to terminate, any such Regulatory License,
Reimbursement Approval or material indenture, agreement, bond, note, mortgage,
deed of trust, or other similar instrument and (v) will not result in the
creation or imposition of (or the obligation to create or impose) any Lien,
charge or encumbrance of any nature whatsoever upon any of the properties or
assets of any of the Credit Parties other than pursuant to this Credit Agreement
or the other Fundamental Documents.
54
SECTION 3.3 Governmental and Other Approval. (a) All
authorizations, approvals, orders, consents, licenses, registrations or filings
from or with any Governmental Authority (other than UCC financing statements and
the Mortgages all of which will be delivered to the Administrative Agent in
accordance with the terms of this Credit Agreement, in form suitable for
recording or filing with the appropriate filing office) required for the
execution, delivery and performance by any Credit Party of this Credit Agreement
and the other Fundamental Documents to which it is a party, and the execution
and delivery by the Borrower of any notes evidencing any of the Loans hereunder,
have been duly obtained or made, and are in full force and effect, and if any
further authorizations, approvals, orders, consents, licenses, registrations or
filings should hereafter become necessary, the Credit Parties shall obtain or
make all such authorizations, approvals, orders, consents, licenses,
registrations or filings.
(b) Each Credit Party has obtained and holds in full force and
effect all Regulatory Licenses, other licenses, Reimbursement Approvals,
authorizations, consents, franchises, permits, certificates (including, without
limitation, certificates of need) accreditations, easements, rights of way and
other approvals necessary to own its respective property and assets and to carry
on its respective business as now being, or as now intended to be, conducted,
other than those the absence of which is not reasonably likely to have a
Material Adverse Effect.
(c) As of the Closing Date, except as set forth on Schedule
3.3(c) hereto, during the last twenty-four (24) months, no Credit Party has been
notified by JCAHO or any relevant Governmental Authority or other Person with
respect to any Regulatory License, any Reimbursement Approval or other approval
or authorization necessary to operate its business as currently being conducted,
of such Governmental Authority's or other Person's actual revocation,
suspension, termination, rescission, or non-renewal, such Regulatory License,
Reimbursement Approval or other approval or authorization.
(d) All required consents and approvals have been obtained
with respect to the financing transaction contemplated hereby from all
Governmental Authorities with jurisdiction over the business and activities of
any Credit Party and from any other entity whose consent, waiver or approval is
required pursuant to the terms of existing contracts to which any of the Credit
Parties is bound.
SECTION 3.4 Binding Agreements. Each Credit Party has duly
executed and delivered this Credit Agreement and each other Fundamental Document
to which it is a party. Each of this Credit Agreement and the other Fundamental
Documents constitutes the legal, valid and binding obligation of each Credit
Party that is a party thereto, enforceable against such Credit Party in
accordance with its respective terms, except as enforceability may be limited by
applicable bankruptcy, insolvency and similar laws affecting creditors' rights
generally and to general principles of equity, whether such enforceability is
considered in a proceeding at law or in equity.
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SECTION 3.5 No Material Adverse Effect. (a) Other than in
connection with the Spin-off as disclosed in the Information Statement, since
June 30, 2003 there has been no material adverse change with respect to the
business, operations, performance, assets, properties, or condition (financial
or otherwise) or prospects of the Credit Parties taken as a whole.
(b) No Credit Party has entered or is entering into the
arrangements contemplated hereby and by the other Fundamental Documents, or
intends to make any transfer or incur any obligations hereunder or thereunder,
with actual intent to hinder, delay or defraud either present or future
creditors. On and as of the Closing Date, on a Pro Forma Basis after giving
effect to the Spin-off and all Indebtedness (including the Loans) expected to be
in existence on the Closing Date: (i) each Credit Party expects the cash
available to such Credit Party, after taking into account all other anticipated
uses of the cash of such Credit Party (including the payments on or in respect
of debt referred to in clause (iii) of this Section 3.5(b)), will be sufficient
to satisfy all final judgments for money damages which have been docketed
against such Credit Party or which may be rendered against such Credit Party in
any action in which such Credit Party is a defendant (taking into account the
reasonably anticipated maximum amount of any such judgment and the earliest time
at which such judgment might be entered); (ii) the sum of the present fair
saleable value of the assets of each Credit Party will exceed the probable
liability of such Credit Party on its debts (including its Guaranties); (iii) no
Credit Party will have incurred or intends to, or believes that it will, incur
debts beyond its ability to pay such debts as such debts mature (taking into
account the timing and amounts of cash to be received by such Credit Party from
any source, and of amounts to be payable on or in respect of debts of such
Credit Party and the amounts referred to in clause (i)); and (iv) each Credit
Party believes it will have sufficient capital with which to conduct its present
and proposed business and the property of such Credit Party does not constitute
unreasonably small capital with which to conduct its present or proposed
business. For purposes of this Section 3.5(b), "debt" means any liability or a
claim, and "claim" means any (y) right to payment whether or not such right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured, or (z)
right to an equitable remedy for breach of performance if such breach gives rise
to a payment, whether or not such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, unmatured, disputed, undisputed,
legal, equitable, secured or unsecured.
SECTION 3.6 Financial Information. (i) The audited, combined
balance sheet of the Borrower at September 30, 2002 and (ii) the unaudited,
combined balance sheet of the Borrower at June 30, 2003, together in each case
with all unaudited pro forma adjustments thereto and with the related statements
of income, stockholders' equity and cash flows and the related notes and
supplemental information, in the forms which have previously been delivered to
the Lenders, have been prepared in accordance with GAAP consistently applied,
except as otherwise indicated in the notes to such financial statements and
subject in the case of unaudited statements, to changes resulting from year-end
and audit adjustments. All of such financial statements fairly present, in
accordance with GAAP, the combined financial position and the results of
operations, as the case may be, of the Borrower, at the dates or for the periods
indicated assuming that the operations of GHVI contributed to the Borrower prior
to the Spin-off were organized as a separate legal entity, as more fully
described in the notes to such financial statements.
56
SECTION 3.7 Credit Parties. (a) Annexed hereto as Schedule
3.7(a) is a correct and complete list as of the Closing Date, of each Credit
Party showing, as to each, (i) its exact legal name, (ii) the jurisdiction in
which it was incorporated or otherwise organized, (iii) its type of
organization, (iv) in the case of a Credit Party, its taxpayer identification
number and organizational identification number if it has one, (v) in the case
of a Credit Party which is a corporation, its authorized capitalization, the
number of shares of its capital stock outstanding and the ownership of such
capital stock, (vi) in the case of a Credit Party which is a limited
partnership, the general partners and limited partners of such Credit Party and
the ownership of its partnership interests, (vii) in the case of a Credit Party
which is a limited liability company, the members of such Credit Party and the
ownership of its limited liability company interests and (viii) in the case of
each Credit Party, the location of its chief executive office and the location
where it keeps the records concerning the Collateral or any Real Property Asset
or any item included in the Collateral.
(b) As of the Closing Date, no Credit Party owns any Capital
Stock, either directly or indirectly, in any Person other than another Credit
Party or as set forth on Schedule 3.7(b) hereto.
SECTION 3.8 Patents, Trademarks, Copyrights and Other Rights.
(a) The Credit Parties possess all patents, patent rights and licenses,
trademarks, service marks, tradenames, trademark rights and licenses,
copyrights, copyright rights and licenses and any other similar rights, free
from burdensome restrictions, which are material to the conduct of their
respective businesses (collectively the "Proprietary Rights") and have duly
recorded their interest in the United States Patent and Trademark Office or the
United States Copyright Office as applicable, except where the failure to have
recorded any of the foregoing would not reasonably be expected to have a
Material Adverse Effect. Schedule 3.8 lists, as of the Closing Date, all
registered Proprietary Rights, and all Proprietary Rights as to which an
application for registration has been made, owned and used or held for use by
any Credit Party, specifying as to each, as applicable: (i) the nature of such
Proprietary Right; (ii) the Credit Party which owns such Proprietary Right;
(iii) the jurisdictions or government offices by or in which such Proprietary
Right has been issued or registered (or, if applicable, in which an application
for such issuance or registration has been filed), including the respective
registration or application numbers, (iv) all licenses, sublicenses and other
agreements (other than any license to use software or similar items which are
readily available in the market place on substantially similar terms) pursuant
to which a Credit Party is authorized to use any Proprietary Right, including,
the identity of the licensor, (v) all licenses, sublicenses and other agreements
pursuant to which any Credit Party granted to a Person other than a Credit Party
a license to use any Proprietary Right including, the identity of the licensee.
To the best of the Credit Parties' knowledge, a Credit Party is either (1) the
sole and exclusive owner (excluding licenses granted by a Credit Party) of all
right, title and interest in and to (free and clear of any Lien) the Proprietary
Rights and has sole and exclusive rights to the use thereof or the material
covered thereby in connection with the services or products in respect of which
they are being used, or (2) the licensee of (free and clear of any Lien) the
Proprietary Rights described in Schedule 3.8 hereto and has the rights to the
use thereof or material covered thereby in connection with the services or
products in respect of which they are being used.
57
(b) Except as set forth on Schedule 3.8 hereto, as of the
Closing Date, (i) there is no claim, suit, action or proceeding pending, or to
the Credit Parties' knowledge, threatened, against a Credit Party that involves
a claim of infringement of any Proprietary Right and (ii) no Credit Party has
any knowledge of any existing infringement by any other Person of any of the
Proprietary Rights which in either case would have a Material Adverse Effect.
SECTION 3.9 Fictitious Names. Except as disclosed on Schedule
3.9 hereto, none of the Credit Parties has done business, is doing business or
intends to do business other than under its full corporate, partnership or
company name (as applicable), including, without limitation, under any trade
name or other doing business name; provided, that if any of the Credit Parties
intends to do business other than under its full corporate, partnership or
company name (as applicable), including, without limitation, under any trade
name or other doing business name, it shall have provided the Administrative
Agent with reasonable prior written notice of its intention to do so.
SECTION 3.10 Title to Properties. (a) Except as set forth on
Schedule 3.10(a) hereto, or in a schedule of permitted encumbrances attached to
a particular Mortgage, the Credit Parties and their Subsidiaries have good title
to (and with respect to Real Property Assets, good and marketable title to, or
valid leasehold interests in) each of the properties and assets reflected on the
financial statements referred to in Section 3.6 hereof, including, without
limitation, the Real Property Assets listed on Schedules 3.24(a) and 3.24(b)
hereto (other than such properties or assets disposed of in the ordinary course
of business since the date of such financial statements or as permitted
hereunder) and all such properties and assets are free and clear of Liens,
except Permitted Liens.
(b) Each of the Credit Parties has complied in all respects
with all leases to which it is a party, and is aware of no defaults under any
such lease or any conditions which with the passage of time or delivery of
notice would constitute a default thereunder and all such leases are in full
force and effect, except where the failure to so comply or the default
thereunder would not reasonably be expected to have a Material Adverse Effect.
Each of the Credit Parties which is a lessee under any lease, enjoys peaceful
and undisturbed possession of the Real Property Assets leased pursuant to such
lease, subject to Permitted Liens.
(c) As of the Closing Date, no Credit Party has received any
notice of, nor has any knowledge of, any pending or contemplated condemnation
proceeding affecting any Real Property Asset or any sale or disposition thereof
in lieu of condemnation.
(d) As of the Closing Date, no Credit Party is obligated under
any right of first refusal, option or other contractual right to sell, assign or
otherwise dispose of any Real Property Asset or any interest therein except for
such rights of first refusal, options or other contractual rights described on
Schedule 3.10(d) hereto.
58
SECTION 3.11 Book Value of Excluded Assets. As of June 30,
2003, the book value of the Excluded Assets described in clauses (ii) and (iii)
of the definition of Excluded Assets does not exceed $20,000,000.
SECTION 3.12 Litigation; Judgments. (a) Except as set forth on
Schedule 3.12(a) hereto, there are no actions, suits or other proceedings at law
or in equity by or before any arbitrator or arbitration panel, or any
Governmental Authority (including, but not limited to, matters relating to
environmental liability) or any investigation by any Governmental Authority of
the affairs of, or to the best of each Credit Party's knowledge, threatened
action, suit or other proceeding against or affecting, any Credit Party or of
any of their respective properties or rights which either (A) could reasonably
be expected to have a Material Adverse Effect, or (B) relate to this Credit
Agreement, any Fundamental Document or any of the transactions contemplated
hereby or thereby or the Loans hereunder. No Credit Party is in default with
respect to any order, writ, injunction, decree, rule or regulation of any
Governmental Authority binding upon such Person, which default could reasonably
be expected to have a Material Adverse Effect.
(b) There are no unpaid final, nonappealable judgments or
decrees in an aggregate amount of $10,000,000 or more entered by a court or
courts of competent jurisdiction against any Credit Party (other than any
judgment as to which, and only to the extent, a reputable insurance company has
acknowledged coverage of such claim in writing).
(c) Except as set forth on Schedule 3.12(c) hereto or as
otherwise disclosed pursuant to Section 5.4(b) with respect to matters arising
after the date hereof, to the knowledge of the Borrower, there is no pending
investigation of the Credit Parties by JCAHO, which investigation is not
otherwise conducted in the ordinary course of business and no criminal, civil or
administrative action, audit, or investigation by a fiscal intermediary or by
the federal government or any state government exists or is threatened with
respect to the Credit Parties which could reasonably be expected to adversely
affect the Credit Parties' right to receive a material portion of Medicare and
Medicaid reimbursement to which it would otherwise be entitled, right to
participate in the Medicare and Medicaid programs, or otherwise have a Material
Adverse Effect on the receipt of Medicare and Medicaid reimbursement by the
Credit Parties, and except as set forth on Schedule 3.12(c) hereto, to the
knowledge of the Borrower, none of the Credit Parties is subject to any pending
but unassessed material Medicare or Medicaid claim payment adjustments, except
to the extent the Borrower has established adequate reserves for such
adjustments in accordance with GAAP.
SECTION 3.13 Federal Reserve Regulations. No Credit Party is
engaged principally or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying any Margin Stock. No
part of the proceeds of the Loans will be used, directly or indirectly, whether
immediately, incidentally or ultimately (i) to purchase or carry any Margin
Stock or to extend credit to others for the purpose of purchasing or carrying
any Margin Stock, or (ii) for any other purpose, in each case, violative of or
inconsistent with any of the provisions of any regulation of the Board,
including, without limitation, Regulations T, U and X thereto.
SECTION 3.14 Investment Company Act. No Credit Party is, or
will during the term of this Credit Agreement be, (i) an "investment company" or
a company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended, or (ii) subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act or any
foreign, federal or local statute or any other Applicable Law of the United
States of America or any other jurisdiction, in each case limiting its ability
to incur indebtedness for money borrowed as contemplated hereby or by any other
Fundamental Document.
59
SECTION 3.15 Taxes. Except as set forth on Schedule 3.15
hereto, each Credit Party has filed or caused to be filed all United States
federal tax returns, state income tax returns and other material tax returns
which are required to be filed with any Governmental Authority after giving
effect to applicable extensions, and has paid or has caused to be paid all taxes
as shown on said returns or on any assessment received by them, to the extent
that such taxes have become due, except as permitted by Section 5.8 hereof. No
Credit Party knows of any material additional assessments or any basis therefor.
In the reasonable, good faith opinion of the Credit Parties, the charges,
accruals and reserves on the books of the Credit Parties in respect of taxes or
other governmental charges are adequate.
SECTION 3.16 Compliance with ERISA. (a) Each Plan has been
maintained and operated in all respects in accordance with all Applicable Laws,
including ERISA and the Code except to the extent that any failure thereof could
not reasonably be expected to result in a material liability. Each Plan intended
to qualify under Section 401(a) of the Code so qualifies except to the extent
that any failure to so qualify could not reasonably be expected to result in a
material liability. No Reportable Event has occurred since the effective date of
the Plan of Reorganization. No Plan has an "accumulated funding deficiency,"
within the meaning of Section 412 of the Code or Section 302 of ERISA, or has
applied for or received a waiver of the minimum funding standards or an
extension of any amortization period, within the meaning of Section 412 of the
Code or Section 303 or 304 of ERISA. No material liability has been, and no
circumstances exist pursuant to which any such material liability could
reasonably likely be, imposed upon any Credit Party or ERISA Affiliate (i) under
Sections 4971 through 4980B of the Code, Section 409, 502(i), 502(l) or 515 of
ERISA, or under Title IV of ERISA with respect to any Plan or Multiemployer
Plan, or with respect to any plan heretofore maintained by any Credit Party or
ERISA Affiliate, or any entity that heretofore was an ERISA Affiliate, or (ii)
for the failure to fulfill any obligation to contribute to any Multiemployer
Plan. Neither any Credit Party nor any ERISA Affiliate has received any
notification that any Multiemployer Plan is in reorganization or has been
terminated within the meaning of Title IV of ERISA, no Multiemployer Plan is
reasonably expected to be in reorganization or to be terminated and, using
actuarial assumptions and computation methods consistent with Part 1 of Subtitle
E of Title IV of ERISA, the aggregate liabilities of the Credit Parties and
their ERISA Affiliates to all Multiemployer Plans in the event of a complete
withdrawal therefrom, as of the close of the most recent fiscal year of each
such Plan then ended would not exceed $1,000,000.
(b) Assuming none of the Lenders is using assets of any
employee benefit plan subject to Title I of ERISA or any "plan" (within the
meaning of Section 4975(e) of the Code) maintained by any Credit Party or any
ERISA Affiliate to make the Loans, the execution, delivery and performance of
the Fundamental Documents and the consummation of the transactions contemplated
hereby and thereby will not involve any "prohibited transaction" within the
meaning of Section 406 of ERISA or Section 4975 of the Code.
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SECTION 3.17 Agreements. (a) No Credit Party is in default in
the performance, observance or fulfillment of any of the obligations, covenants
or conditions contained in any agreement or instrument to which it is a party
(including, without limitation, any Regulatory License or any Reimbursement
Approval) or by which it or any of its property or assets is bound in any
respect which default could reasonably be expected to result in a Material
Adverse Effect.
(b) Schedule 3.17(b) hereto is a true and complete listing as
of the Closing Date of Material Agreements.
SECTION 3.18 Security Interest. (a) This Credit Agreement and
the other Fundamental Documents (other than the Mortgages), when executed and
delivered, will create and grant to the Administrative Agent for the benefit of
the Secured Parties (upon (i) the filing of the appropriate UCC-1 financing
statements with the filing offices listed on Schedule 3.18(a) hereto and (ii)
the possession of the certificates evidencing Pledged Securities and Collateral
of the type specified in Section 9-313 of the UCC) a valid and first priority
perfected security interest in the Collateral (other than such de minimus
portion of the Collateral, a security interest in which cannot be perfected by
filing of a UCC-1 Financing Statement), subject only to Permitted Liens.
(b) The Mortgages, when executed and delivered, will create in
favor of the Administrative Agent, for the benefit of the Secured Parties, a
legal, valid and enforceable first priority Lien on all of the Credit Parties'
respective right, title and interest in and to all the Real Property Assets
(except personalty that does not constitute fixtures) and the proceeds thereof,
and when the Mortgages are filed in the offices specified on Schedule 3.18(b)
hereto, the proper amount of mortgage recording or similar taxes (if any) are
paid and when the UCC-1 financing statements relating to fixtures are duly filed
with the filing offices listed on Schedule 3.18(b) hereto, the Mortgages shall
constitute fully perfected first priority Liens on, and fully perfected first
priority security interests in, all right, title and interest of the Credit
Parties' in all the Real Property Assets (except personalty that does not
constitute fixtures) and the proceeds thereof, in each case subject only to
Permitted Liens.
SECTION 3.19 Disclosure. Neither this Credit Agreement nor any
other Fundamental Document nor any agreement, document, certificate or statement
furnished to any of the Agents, the Issuing Bank or any Lender by or on behalf
of any Credit Party in connection with the transactions contemplated hereby, at
the time it was furnished or delivered, contained any untrue statement of a
material fact regarding the Credit Parties or the financing transactions
contemplated hereby including the Collateral or, when taken together with all
such other agreements, documents, certificates and statements, omitted to state
a material fact necessary under the circumstances under which it was made in
order to make the statements contained herein or therein not misleading. There
is no fact known to any Credit Party (other than general industry conditions,
facts relating to the Spin-off as disclosed in the Information Statement, or
such other facts which have been disclosed to the Agents, the Issuing Bank and
the Lenders in writing) which has had a Material Adverse Effect, or could
reasonably be expected in the future to have a Material Adverse Effect.
61
SECTION 3.20 Environmental Matters. (a) Except as set forth on
Schedule 3.20 hereto, as of the Closing Date, there are no past, pending, or, to
the knowledge of the Borrower, threatened Environmental Claims against,
affecting or with respect to any Credit Party or any Premises, and no Credit
Party is aware of any facts or circumstances which could reasonably be expected
to form the basis for any such Environmental Claim, except to the extent that
any such Environmental Claims, individually or in the aggregate, would not have
a Material Adverse Effect;
(b) No Premises is currently or was formerly used for the
handling, storage, treatment, disposal, manufacture, processing or generation of
Hazardous Materials, except to the extent that any such activity, individually
or in the aggregate, would not reasonably be expected to have a Material Adverse
Effect on any Credit Party;
(c) Each Credit Party and any tenants, operators or occupants
of any Premises have obtained and hold all required material Environmental
Permits, except to the extent that any failure to obtain or hold any such
Environmental Permit, individually or in the aggregate, would not have a
Material Adverse Effect;
(d) Each Credit Party is in compliance with all terms,
conditions and provisions of all applicable (1) Environmental Permits, and (2)
Environmental Laws, except to the extent that any such non-compliance,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect;
(e) No Releases of Hazardous Materials have occurred at, from,
in, to, on, or under any Premises, and no Hazardous Materials are present in,
on, about or migrating to or from any Premises, except to the extent that any
such Releases or presence of Hazardous Materials, individually or in the
aggregate, would not reasonably be expected to have a Material Adverse Effect;
(f) Neither any Credit Party nor any predecessor of any Credit
Party, nor any entity previously owned by any Credit Party, has transported or
arranged for the treatment, storage, handling, disposal, or transportation of
any Hazardous Material to any location (other than any Premises) which could
result in an Environmental Claim against any Credit Party, except to the extent
that any such activity, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect;
(g) No Premises is a current, or to the knowledge of any
Credit Party, a proposed Environmental Clean-up Site, except to the extent as
would not reasonably be expected to have a Material Adverse Effect;
(h) There are no (i) underground storage tanks (active or
abandoned), (ii) polychlorinated biphenyl containing equipment, (iii)
asbestos-containing material at any Premises, or (iv) lead-based paint located
at any Premises, except to the extent that the presence of any of the foregoing,
individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect; and
(i) There have been no material environmental investigations,
studies, audits, tests, reviews or other analyses conducted by, or on behalf of,
and which are in the possession of any Credit Party with respect to any Premises
which have not been delivered to the Agents except for such investigations,
studies, audits, tests, reviews or analyses which do not individually or in the
aggregate reveal environmental conditions that could have a Material Adverse
Effect.
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SECTION 3.21 Pledged Securities. (a) Annexed hereto as
Schedule 3.21(a) under the heading "Pledged Capital Stock and Other Pledged
Equity Interests" is a correct and complete list as of the Closing Date, of all
the Pledged Securities hereunder showing, as to each, the entity whose stock or
other equity interests are being pledged, the Pledgor of such stock or other
equity interests, the stock certificate number (if applicable) and the number of
shares or amount of the capital stock or other equity interests being pledged
hereunder. Also set forth on Schedule 3.21(a) under the heading "Non-Pledged
Capital Stock" is a list of the Subsidiaries directly or indirectly owned or
controlled by a Credit Party whose Capital Stock will not be pledged hereunder.
Each Pledgor (i) is the legal and beneficial owner of, and has sole right, title
and interest to, the Pledged Securities owned by such Pledgor, free and clear of
all Liens, security interests or other encumbrances whatsoever, except the
security interests created by this Credit Agreement and the other Fundamental
Documents and (ii) has sole right and power to pledge, and grant the security
interest in, and Lien upon, such Pledged Securities pursuant to this Credit
Agreement without the consent of any Person or Governmental Authority
whatsoever.
(b) All of the Pledged Securities are duly authorized, validly
issued, fully paid and non-assessable.
(c) There are no restrictions on the transfer of any of the
Pledged Securities which limit the ability of a Pledgor to pledge such
securities or interests (as applicable) to the Administrative Agent (for the
benefit of the Secured Parties). Except as set forth on Schedule 3.21(c) hereto
and for restrictions created herein or under applicable securities laws or
regulatory laws and the regulations promulgated thereunder, there are no
restrictions on the transfer of any of the Pledged Securities by the
Administrative Agent upon the occurrence of an Event of Default.
(d) There are no warrants, options, conversion or similar
stock purchase rights currently outstanding with respect to, and no agreements
to purchase or otherwise acquire, any shares of the Capital Stock or other
equity interests of any issuer of any of the Pledged Securities.
(e) There are no securities or obligations of any kind
convertible into any shares of the Capital Stock or other equity interests of
any issuer of any of the Pledged Securities; and
(f) Article 10 of this Credit Agreement is effective to create
a valid, binding and enforceable security interest in, and Lien upon, all right,
title and interest of the Pledgors in the Pledged Collateral and upon the
delivery of the Pledged Securities to the Administrative Agent or the filing of
the necessary UCC-1 financing statements, as applicable, such security interest
and Lien constitute a fully perfected first and prior security interest and Lien
upon all right, title and interest of the Pledgors in the Pledged Collateral.
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SECTION 3.22 Compliance with Laws; Third Party Payor
Arrangements. (a) No Credit Party or any Real Property Asset is in violation of
any Applicable Law (including, without limitation, any Environmental Law or
health care law) or any restrictions of record or agreements affecting any Real
Property Asset, except for such violations which in the aggregate are not
reasonably likely to have a Material Adverse Effect.
(b) No Credit Party or any Real Property Asset is in violation
of any zoning or building law, ordinance, rule, regulation or restriction
affecting a Real Property Asset or any building permit, including, without
limitation, any certificate of occupancy, where such violation could reasonably
be expected to result in a Material Adverse Effect.
(c) The Borrowings hereunder, the intended use of the proceeds
of the Loans as contemplated by Sections 2.1(b) and 2.2(b) hereof, the issuance
of the Letters of Credit hereunder and the performance of the Fundamental
Documents will not violate any Applicable Law.
(d) Each Credit Party has caused to be accurately prepared and
filed (or obtained extensions for) all applicable cost reports with respect to
all Third Party Payor Arrangements, except for such cost reports the failure of
which to file, in the aggregate, are not reasonably likely to have a Material
Adverse Effect.
(e) Each Credit Party participates in an internal
comprehensive compliance program with respect to Applicable Laws relating to the
health care industry.
SECTION 3.23 Projected Financial Information. The Borrower has
delivered to the Agents certain projections relating to the Borrower consisting
of balance sheets, income statements and cash flows, together with a statement
of the underlying assumptions. Such projected statements are based on good faith
estimates and assumptions believed to be reasonable at the time made, it being
recognized by the Lenders that such projections as to future events are not to
be viewed as facts and that actual results during the period or periods covered
by any such projections may differ from the projected results.
SECTION 3.24 Real Property. (a) Schedule 3.24(a) is a true and
complete list as of the Closing Date of (i) the facility number and street
address of each Real Property Asset owned by a Credit Party, (ii) the Credit
Party which owns each such Real Property Asset, (iii) the appraised value of
each such Real Property Asset, if available, and the date of the applicable
appraisal, (iv) the facility type of each such Real Property Asset, (v) any
lease(s) to which each such Real Property Asset is subject and (vi) the name and
address of the lessee, if applicable, of each such Real Property Asset. The
applicable Credit Party has a fee simple title to each Real Property Asset
listed on Schedule 3.24(a) hereto.
(b) Schedule 3.24(b) is a true and complete list as of the
Closing Date of (i) the facility number and street address of each Real Property
Asset leased by a Credit Party, (ii) the Credit Party which leases each such
Real Property Asset, (iii) the facility type of such Real Property Asset, (iii)
the name and address of the owner/lessor of each such Real Property Asset, (iv)
the leases to which each such Real Property Asset is subject and (v) the name
and address of any sublessee of each such Real Property Asset.
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(c) With respect to each of the Real Property Assets, except
as, in the aggregate for all Real Property Assets, could not reasonably be
expected to have a Material Adverse Effect:
(i) none of the Real Property Assets are located in a "flood
plain" as defined pursuant to the Flood Disaster Protection Act of
1973, as amended;
(ii) real property tax lots covering the Real Property Assets
do not cover any other real property;
(iii) each Real Property Asset is an independent unit which
does not rely on any drainage, sewer, access, structural or other
facilities located on any other real property not included in the same
(x) to fulfill any Applicable Law, (y) for structural support or (z) to
furnish any essential building systems or utilities or to provide
access; and
(iv) no building or other improvement not included in any Real
Property Asset relies on any part of the same to fulfill any Applicable
Law, for structural support or to furnish any essential building
systems or utilities or to provide access.
SECTION 3.25 No Default. No Default or Event of Default exists
under or with respect to any Fundamental Document.
SECTION 3.26 Labor Matters. Except as set forth on Schedule
3.26 hereto, (i) as of the Closing Date, there are no collective bargaining
agreements or Multiemployer Plans covering the employees of any Credit Party and
(ii) no Credit Party has suffered any material strikes, walkouts or work
stoppages within the last three (3) years.
SECTION 3.27 Organizational Documents. The documents delivered
pursuant to Section 4.1(b) constitute, as of the Closing Date, all of the
organizational documents (together with all amendments and modifications
thereof) of the Credit Parties as of the Closing Date. The Credit Parties
represent that they have delivered to the Administrative Agent true, correct and
complete copies of each of the documents set forth in Section 4.1(b).
4. CONDITIONS TO THE EFFECTIVENESS OF THIS CREDIT AGREEMENT AND THE MAKING OF
THE LOANS
SECTION 4.1 Conditions Precedent to the Effectiveness of This
Credit Agreement and the Making of the Loans. The effectiveness of this Credit
Agreement and the making of the Loans is subject to the satisfaction in full or
waiver of the following conditions, either before or simultaneous with the
Closing Date:
(a) The Credit Agreement. The Administrative Agent shall have
received executed counterparts of this Credit Agreement, which, when taken
together, bear the signatures of the Agents, the Issuing Bank, all of the Credit
Parties and all of the Lenders;
(b) Supporting Documents of the Credit Parties. The
Administrative Agent shall have received in form and substance satisfactory to
its counsel:
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(i) a copy of the articles of incorporation of the Borrower,
certified as of a recent date by the Secretary of the Commonwealth of
Pennsylvania;
(ii) a certificate of the Secretary of the Borrower, dated the
Closing Date and certifying (A) that attached thereto is a true and
complete copy of the articles of incorporation and by-laws of the
Borrower as in effect on the date of such certification; (B) that the
articles of incorporation of the Borrower have not been amended since
the date of the last amendment thereto indicated on the certificate of
the Secretary of the Commonwealth of Pennsylvania furnished pursuant to
clause (i) above, except to the extent specified in such Secretary's
Certificate; (C) that attached thereto is a true and complete copy of
resolutions adopted by the Borrower's Board of Directors authorizing
the Borrowings by the Borrower, the grant by the Borrower of the
security interests contemplated by the Fundamental Documents and the
execution, delivery and performance by the Borrower in accordance with
its respective terms of this Credit Agreement, the other Fundamental
Documents to which it is or will be a party and any other documents
required or contemplated hereunder or thereunder and that such
resolutions have not been amended, rescinded or supplemented and are
currently in effect; and (D) as to the incumbency and specimen
signature of each officer of the Borrower executing this Credit
Agreement, any notes (on behalf of the Borrower), the other Fundamental
Documents or any other document delivered in connection herewith or
therewith on behalf of the Borrower (such certificate to contain a
certification by another officer of the Borrower as to the incumbency
and signature of the officer signing the certificate referred to in
this clause (ii));
(iii) a certificate of the Secretary of each other Credit
Party, dated the Closing Date (which certificate may be an omnibus
certificate executed by the same individual on behalf of multiple
Credit Parties), and certifying (A) such Credit Party is in good
standing in its jurisdiction of organization and has paid all its
franchise and other similar taxes except where such failure to be in
good standing would not have a Material Adverse Effect; (B) that
attached thereto is a true and complete copy of resolutions or other
authorizing documents adopted by the appropriate Person or Persons of
such Credit Party authorizing the Guaranty hereunder by such Credit
Party, the grant by such Credit Party of the security interests
contemplated by the Fundamental Documents and the execution, delivery
and performance by such Credit Party in accordance with its respective
terms of this Credit Agreement, the other Fundamental Documents to
which it is or will be a party and any other documents required or
contemplated hereunder or thereunder and that such resolutions have not
been amended, rescinded or supplemented and are currently in effect and
(C) as to the incumbency and specimen signature of each officer of such
Credit Party executing this Credit Agreement, any other Fundamental
Documents or any other document delivered in connection herewith or
therewith on behalf of such Credit Party (such certificate to contain a
certification by another officer of such Credit Party as to the
incumbency and signature of the officer signing the certificate
referred to in this clause (iii));
(iv) a certificate dated as of a recent date as to the good
standing and/or authority to do business of each of the Borrower and
the other Credit Parties issued by the Secretary of State or other
appropriate governmental official of the jurisdiction of its
organization and, to the extent requested by the Administrative Agent,
each other jurisdiction in which such entity is qualified to do
business; and
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(v) such additional documents relating to the Borrower and any
other Credit Party as the Administrative Agent or its counsel or any
Lender may reasonably request;
(c) Opinions of Counsel. The Administrative Agent shall have
received the written opinions of Drinker, ▇▇▇▇▇▇ & ▇▇▇▇▇ LLP, counsel to the
Credit Parties and of local counsel in each of the states listed on Schedule
4.1(c) hereto, each dated the Closing Date and addressed to the Agents, the
Issuing Bank, the Lenders and the other Secured Parties with respect to such
matters relating to this Credit Agreement and the Fundamental Documents as may
be requested by the Administrative Agent and its counsel, which opinion shall be
in form and substance satisfactory to the Administrative Agent and its counsel;
(d) No Material Adverse Effect. Other than in connection with
the Spin-off, no Material Adverse Effect shall have occurred since June 30,
2003;
(e) Material Agreements. The Administrative Agent or its
counsel shall have received a copy of each Material Agreement listed on Schedule
3.17(b) hereto, to the extent requested by the Administrative Agent;
(f) Financing Statements/Possession of Collateral. The
Administrative Agent shall have (i) received for filing all appropriate UCC
financing statements to perfect its security interest in the Collateral and
evidence satisfactory to the Administrative Agent that such UCC financing
statements will be filed on or promptly after the Closing Date, together with
any related filing fees or similar charges or taxes payable in connection with
such filing; (ii) received the Pledged Securities (to the extent such Pledged
Securities are represented by a certificate or other instrument) and all
instruments constituting Collateral each with appropriate undated stock powers
or other appropriate documents executed in blank and (iii) received delivery of
all other Collateral of the type specified in Section 9-313 of the UCC to the
extent requested by the Administrative Agent;
(g) Mortgages. The Administrative Agent shall have received a
duly executed Mortgage and appropriate UCC-1 Financing Statements with respect
to each owned Real Property Asset;
(h) Title Report. The Administrative Agent shall have received
a recent report by a Title Company as to the state of title of each owned Real
Property Asset, showing all Liens and encumbrances of record to the extent
requested by the Administrative Agent;
(i) Intentionally Omitted.
(j) Leases. The Administrative Agent or its counsel shall have
received certified true and complete copies of all material leases encumbering
the Real Property Assets, to the extent requested by the Administrative Agent;
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(k) Evidence of Title. The Administrative Agent shall be
satisfied that each Credit Party has sufficient right, title and interest in and
to the Collateral, the Real Property Assets and other assets which it purports
to own, as set forth in the documents and other materials presented to the
Agents to enable such Credit Party to grant to the Administrative Agent for the
benefit of the Secured Parties the security interests contemplated by the
Fundamental Documents, and that all financing statements, mortgages and other
filings under Applicable Law necessary to provide the Administrative Agent for
the benefit of the Secured Parties with a first priority perfected security
interest in the Pledged Securities, the Collateral and all Real Property Assets
(subject in the case of the Collateral and the Real Property Assets, to
Permitted Liens) have been filed and all taxes, recording or other fees relating
thereto have been paid, or, have been delivered to the Administrative Agent in
satisfactory form for filing;
(l) Insurance. The Administrative Agent shall have received
(i) a summary of all existing insurance coverage maintained by the Credit
Parties and their Subsidiaries which summary shall include for each insurance
policy, the policy number, the type of coverage, the policy limits and
deductibles, the insurer and the expiration date and (ii) evidence acceptable to
the Administrative Agent that the insurance policies required by Section 5.5
have been obtained and are in full force and effect, including Certificates of
Insurance with respect to all existing insurance coverage maintained by the
Credit Parties and/or their Subsidiaries which is set forth on the summary
delivered pursuant to clause (i) above, which certificates shall comply with the
requirements set forth in Section 5.5 hereof;
(m) Payment of the Fees. The Agents and the Co-Lead Arrangers
(for their benefit and the benefit of the Lenders) shall have received all Fees
due and payable on or before the Closing Date pursuant to the Fee Letter or this
Credit Agreement;
(n) Notes. For each Lender that has requested that the Loans
made by it be evidenced by a promissory note, the Administrative Agent shall
have received one or more promissory notes each duly executed on behalf of the
Borrower, dated the date hereof and payable to the order of such Lender in the
principal amount equal to such Lender's B Term Loans and/or Revolving Credit
Commitment, as applicable;
(o) Payment of Other Fees and Expenses. All out-of-pocket
expenses incurred by the Administrative Agent, the Co-Lead Arrangers and the
Issuing Bank in connection with this Credit Agreement and the transactions
contemplated hereby, including, without limitation, all statements presented for
reasonable fees and disbursements of any financial, accounting or valuation
advisors or special counsel retained by the Agents (including, but not limited
to, ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel to the Agents), shall have been paid by
the Borrower;
(p) Litigation. No litigation, inquiry, injunction or
restraining order shall be pending, entered or threatened which involves this
Credit Agreement or any of the other Fundamental Documents or which could
reasonably be expected to have a Material Adverse Effect;
(q) Required Consents and Approvals. The Administrative Agent
shall be satisfied that all required consents and approvals have been obtained
with respect to the Spin-off (except for consents and approvals which are not
reasonably likely to have a Materially Adverse Effect), from all Governmental
Authorities with jurisdiction over the business and activities of any Credit
Party and from any other entity whose consent, waiver or approval is required
pursuant to the terms of existing contracts to which any of the Credit Parties
is bound and which the Administrative Agent in its discretion deems necessary to
the transactions contemplated hereby;
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(r) Compliance with Laws. The Lenders shall be satisfied that
the transactions contemplated hereby will not violate any provision of
Applicable Law, or any order of any court or other agency of the United States
or any state thereof applicable to any of the Credit Parties or any of their
respective properties or assets;
(s) Representations and Warranties; No Default. The
representations and warranties set forth in Article 3 hereof and in any other
Fundamental Documents then in existence shall be true and correct in all
material respects, and no Default or Event of Default shall have occurred and be
continuing hereunder;
(t) Closing Certificate. The Administrative Agent shall have
received a closing certificate signed by an Authorized Officer of the Borrower,
substantially in the form of Exhibit F hereto;
(u) Approval of Counsel to the Agents. All legal matters
incident to this Credit Agreement, the Fundamental Documents and the
transactions contemplated hereby and thereby shall be reasonably satisfactory to
▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP, counsel to the Administrative Agent;
(v) Other Documents. The Agents and their counsel shall have
received fully executed originals of the Contribution Agreement and such other
documentation as the Agents or their counsel may request;
(w) Spin-off. The Spin-off shall have been consummated
substantially as described in the Information Statement;
(x) GHVI Credit Agreement. All Indebtedness under GHVI's
Credit, Security, Guaranty and Pledge Agreement dated as of October 2, 2001 (as
amended) shall have been repaid in full and all commitments thereunder
terminated; and
(y) Cash Management. The Borrower shall have established a
cash management system acceptable to the Administrative Agent for the Borrower
and the Guarantors, it being acknowledged by the Administrative Agent that the
Borrower's current existing cash management system is acceptable subject to
appropriate modifications being made to accommodate the Spin-off.
SECTION 4.2 Conditions Precedent to Each Loan and each Letter
of Credit. The obligation of the Issuing Bank to issue each Letter of Credit and
of the Lenders to make each Loan and to participate in each Letter of Credit
(including the initial Loan and/or Letter of Credit) are subject to the
following conditions precedent:
(a) Notice. The Administrative Agent shall have received a
notice with respect to such Borrowing or the Issuing Bank and the Administrative
Agent shall have received a notice with respect to such Letter of Credit as
required by Section 2.2 or Section 2.21 hereof, as applicable;
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(b) Borrowing Certificate. The Administrative Agent shall have
received a Borrowing Certificate with respect to such Borrowing, duly executed
by an Authorized Officer of the Borrower;
(c) Representations and Warranties. The representations and
warranties set forth in Article 3 hereof and in the other Fundamental Documents
shall be true and correct in all material respects on and as of the date of each
Borrowing or issuance of a Letter of Credit (except to the extent that such
representations and warranties expressly relate to an earlier date) with the
same effect as if made on and as of such date;
(d) No Event of Default. On the date of each Borrowing or
issuance of a Letter of Credit hereunder, no Default or Event of Default shall
have occurred and be continuing, nor shall any such event occur by reason of the
making of the requested Revolving Credit Loan or the issuance of the requested
Letter of Credit; and
(e) Total Revolving Credit Commitment. After giving effect to
the Revolving Credit Loans or Swingline Loans to be made or Letters of Credit to
be issued, the aggregate principal amount outstanding of all Revolving Credit
Loans plus all Swingline Loans plus the then current L/C Exposure shall not
exceed the Total Revolving Credit Commitment.
Each request for a Borrowing or issuance of a Letter of Credit hereunder shall
be deemed to be a representation and warranty by the Borrower on the date of
such Borrowing or issuance of a Letter of Credit hereunder as to the matters
specified in paragraphs (c), (d) and (e) of this Section 4.2.
5. AFFIRMATIVE COVENANTS
From the date hereof and for so long as any Commitments shall
be in effect, any amount remains outstanding with respect to any Loan, any
Letter of Credit shall remain outstanding (or not cash collateralized in an
amount equal to 105% of the then current L/C Exposure) or any Obligation remains
unpaid or unsatisfied, each Credit Party agrees that, unless the Required
Lenders shall otherwise consent in writing, each of them will:
SECTION 5.1 Financial Statements and Reports. (a) Subject to
the last paragraph of this Section 5.1(a), furnish or cause to be furnished to
the Agents, the Issuing Bank and each of the Lenders:
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(i) As soon as available, but in any event within ninety (90)
days (plus the period of any extensions obtained by the Borrower
pursuant to Rule 12b-25 of the Exchange Act) after the end of each
fiscal year of the Borrower (commencing with fiscal year ended
September 30, 2003, provided that such fiscal year 2003 financial
statements shall not be required to be delivered until February 12,
2004), (A) the consolidated (or combined in the case of the fiscal year
2003 financial statements) balance sheet of the Borrower and its
Consolidated Subsidiaries, in each case as at the end of, and the
related consolidated statements of income, stockholders' equity and
cash flows for, such fiscal year, and the corresponding figures as at
the end of, and for, the preceding fiscal year, and in the case of such
consolidated statements, certified by and accompanied by an unqualified
report and opinion of KPMG LLP, any other Big Four accounting firm or
another independent public accountant of recognized standing as shall
be retained by the Borrower and be satisfactory to the Administrative
Agent, which report and opinion shall be prepared in accordance with
generally accepted auditing standards relating to reporting and which
report and opinion shall contain no material exceptions or
qualifications except for qualifications relating to accounting changes
(with which such independent public accountants concur) in response to
FASB releases or other authoritative pronouncements and (B) annual
percentage statistics concerning occupancy rate, payor mix, any other
statistical and operating information that Borrower deems relevant in
the operation of its business and such other information as the
Administrative Agent may reasonably request;
(ii) As soon as available, but in any event within forty-five
(45) days (plus the period of any extensions obtained by the Borrower
pursuant to Rule 12b-25 of the Exchange Act) after the end of each of
the first three fiscal quarters of each of its fiscal years (commencing
with the fiscal quarter ending December 31, 2003), (A) the unaudited
and consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries as at the end of, and the related unaudited consolidated
statements of income, stockholders' equity and cash flows for, such
quarter, and for the portion of the fiscal year through the end of such
quarter, and the corresponding figures as at the end of such quarter,
and for the corresponding period, in the preceding fiscal year,
together with a certificate signed by an Authorized Officer of the
Borrower, on behalf of the Borrower, to the effect that such financial
statements, while not examined by independent public accountants,
reflect, in the opinion of the Borrower, all adjustments necessary to
present fairly the financial position of the Borrower and its
Consolidated Subsidiaries as at the end of the fiscal quarter and the
results of operations for the quarter then ended in conformity with
GAAP, subject to normal year-end audit adjustments and the absence of
footnotes and (B) quarterly percentage statistics concerning occupancy
rate, payor mix, any other statistical and operating information that
Borrower deems relevant in the operation of its business and such other
information as the Administrative Agent may reasonably request;
(iii) Simultaneously with the delivery of the statements
referred to in paragraphs (i) and (ii) of this Section 5.1(a), a
certificate of an Authorized Officer of the Borrower in form and
substance reasonably satisfactory to the Administrative Agent (A)
stating whether or not such Authorized Officer has knowledge, after due
inquiry, of any condition or event which would constitute an Event of
Default or Default and, if so, specifying each such condition or event
and the nature thereof and what action any Credit Party is taking or
proposes to take with respect thereto and (B) demonstrating in
reasonable detail compliance with the provisions of Sections 6.9
through 6.13 hereof;
(iv) Promptly upon their becoming available, copies of all
financial audits, studies, reports or evaluations prepared for, or
submitted to, any of the Credit Parties by any outside professional
financial firm or service, including, without limitation, any comment
letter submitted by the Borrower's accountants to management in
connection with their annual audit;
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(v) Promptly upon their becoming available, copies of all
registration statements, proxy statements, notices and reports which
the Borrower or any other Credit Party shall file with any securities
exchange or with the SEC or any successor agency; and
(vi) Within thirty (30) days after the end of each fiscal
year, a set of financial projections for the Borrower and its
Consolidated Subsidiaries for the next fiscal year in a form and in
reasonable detail satisfactory to the Administrative Agent.
Information required to be delivered pursuant to this Section
5.1(a) shall be deemed to have been delivered on the date on which the Borrower
provides notice to the Agents, Issuing Bank and each Lender that such
information has been posted on the Borrower's website on the Internet at the
website address listed on the signature pages hereof, at
[▇▇▇.▇▇▇/▇▇▇▇▇/▇▇▇▇▇▇▇▇.▇▇▇] or at another website identified in such notice and
accessible by the Lenders without charge; provided, that (A) such notice may be
included in a certificate delivered to the Administrative Agent pursuant to
paragraph (iii) hereof, and (B) the Borrower shall deliver paper copies of the
information referred to in paragraphs (i), (ii) and (iii) hereof to any Lender
that requests such delivery. All other notices and information required to be
provided pursuant to this Section 5.1(a) shall be deemed delivered pursuant to
this Section 5.1(a) when delivered to the Administrative Agent; provided, that
the Borrower shall deliver paper copies of any such notice or information to any
Lender that requests such delivery.
(b) Subject to the last paragraph of this Section 5.1(b),
furnish or cause to be furnished to the Administrative Agent:
(i) Promptly, and in any event within five (5) Business Days,
after receipt of any material notice or correspondence from any company
or agent for any company providing insurance coverage to any Credit
Party relating to any material loss or any loss in excess of $5,000,000
with respect to any Real Property Asset, copies of such notices and/or
correspondence;
(ii) Without limiting any Credit Party's other obligations to
give notice under the Fundamental Documents, within twenty (20) days of
the end of each calendar quarter, a schedule setting forth each sale or
other disposition of any asset or property effected outside the
ordinary course of business during such quarter, the date of each such
sale or disposition, the sales price with respect to such asset or
property sold or disposed of and the Net Cash Proceeds received during
such quarter from each such sale or disposition;
(iii) From time to time such additional information regarding
the financial condition or business of any of the Credit Parties, any
Real Property Asset or the Collateral, as the Administrative Agent, the
Issuing Bank or any Lender, acting through the Administrative Agent,
may reasonably request, including, without limitation, copies of all
management projections prepared at the reasonable request of any of the
Agents; and
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(iv) Upon the request of the Administrative Agent, updates and
such other information as the Administrative Agent may request with
respect to the status of any repurchase of the Borrower's common stock
as contemplated by Section 6.5(f) hereof.
All notices and information required to be provided pursuant to this Section
5.1(b) shall be deemed delivered pursuant to this Section 5.1(b) when delivered
to the Administrative Agent.
SECTION 5.2 Compliance with Laws. (a) Do or cause to be done
all things necessary (i) to preserve, renew and keep in full force and effect
its existence, Proprietary Rights, Regulatory Licenses, other licenses,
Reimbursement Approvals, permits, franchises, certificates (including, without
limitation, certificates of need), authorization, accreditations, easements,
rights of way and other rights, consents and approvals the nonexistence of which
is reasonably likely to have a Material Adverse Effect and (ii) to comply with
all applicable statutes, ordinances, rules, regulations and orders of, and all
applicable restrictions or requirements imposed by, any Governmental Authority
(including, without limitation, health care laws, Environmental Laws, all zoning
and building codes and ERISA) or any other Requirements except where the
necessity of compliance therewith is contested in good faith by the appropriate
proceedings or where such noncompliance in the aggregate would not reasonably be
expected to have a Material Adverse Effect; provided, in each case, that the
applicable Credit Party shall have set aside on its books reasonable reserves
(the presentation of which is segregated to the extent required by GAAP) with
respect thereto if such reserves are required by GAAP or where such
noncompliance in the aggregate would not reasonably be expected to have a
Material Adverse Effect.
(b) Obtain or make all further authorizations, approvals,
orders, consents, licenses, registration or filings from or with any
Governmental Authority required for the performance by any Credit Party of this
Credit Agreement and the other Fundamental Documents to which it is a party.
SECTION 5.3 Maintenance of Properties. Except to the extent
that the failure to do any of the following would not, in the aggregate,
reasonably be expected to have a Material Adverse Effect, (a) keep its tangible
properties including, without limitation, each Real Property Asset, in good
repair, working order and condition (ordinary wear and tear and damage by
casualty excepted) and (b) from time to time (i) subject to the terms hereof,
make all necessary and proper repairs, renewals, replacements, additions and
improvements thereto and (ii) comply with the provisions of all Regulatory
Licenses, Reimbursement Approvals, leases and other Material Agreements to which
it is a party so as to prevent any loss or forfeiture thereof or thereunder
unless compliance therewith is being currently contested in good faith by
appropriate proceedings and appropriate reserves have been established in
accordance with GAAP.
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SECTION 5.4 Notice of Material Events. (a) Promptly upon, but
in any event within five (5) Business Days after, an Authorized Officer or other
executive officer of any Credit Party obtaining knowledge of (i) any (X) Default
or (Y) Event of Default, (ii) any Material Adverse Effect, (iii) any action,
event or condition which could reasonably be expected to have a Material Adverse
Effect, (iv) the change of the chief executive office or the principal place of
business of any Credit Party or of the location of any Credit Party's books and
records with respect to the Collateral, any Real Property Asset or any Pledged
Securities, (v) any change in the name, corporate structure or the jurisdiction
of organization of any Credit Party, (vi) a change in the organizational
identification number of any Credit Party or the receipt of an organizational
number by a Credit Party which previously did not have one; (vii) any other
event which could reasonably be expected to materially decrease the value of the
Collateral, (viii) any material amendment to any Material Agreement, (ix) any
Person giving any notice to any Credit Party or taking any other action to
enforce remedies with respect to a claimed default or event or condition of the
type referred to in paragraphs (g), (h), (i) or (j) of Article 7, (x) any
strike, walkout, work stoppage or other material labor difficulty with respect
to any Credit Party, (xi) any pending or contemplated condemnation proceeding
affecting any Real Property Asset which would result in Net Cash Proceeds of
$3,000,000 or more or (xii) any revocation, suspension, termination, rescission,
non-renewal, forfeiture or similar action by any Governmental Authority to take
any of the foregoing actions with respect to a Regulatory License or a
Reimbursement Approval or any material amendment to any Regulatory License or
Reimbursement Approval, give written notice thereof to the Administrative Agent
specifying the nature and period of existence of any such condition or event, or
specifying the notice given or action taken by such Person and the nature of
such claimed Event of Default or condition and what action any Credit Party has
taken, is taking and proposes to take with respect thereto.
(b) Promptly upon, but in any event within ten (10) Business
Days after, an Authorized Officer or other executive officer of any Credit Party
obtaining knowledge of (i) the institution of, or threat of, any action, suit,
proceeding, investigation or arbitration by any Governmental Authority or other
Person against or affecting any Credit Party or any of its assets including,
without limitation, any Real Property Asset, Regulatory License or Reimbursement
Approval but excluding any condemnation proceeding or any sale or disposition in
lieu of condemnation with respect to any Real Property Asset which would result
in Net Cash Proceeds of less than $3,000,000 and (ii) any material development
in any such action, suit, proceeding, investigation or arbitration (whether or
not previously disclosed to the Administrative Agent), which, in the case of
clause (i) or (ii) above, is reasonably likely to have a Material Adverse
Effect, such Credit Party shall promptly give written notice thereof to the
Administrative Agent and provide such other information as may be available to
it to enable the Administrative Agent to evaluate such matters; and, in addition
to the requirements set forth in clauses (i) and (ii) of this subsection (b),
such Credit Party upon request shall promptly give notice to the Administrative
Agent of the status of any action, suit, proceeding, investigation or
arbitration covered by a report delivered to the Administrative Agent pursuant
to this subsection (b) above and provide such other information as may be
reasonably available to it to enable the Agents to evaluate such matters.
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SECTION 5.5 Insurance. (a) Keep its assets, or cause its
tenants under applicable leases to keep its assets, which are of an insurable
character (including, without limitation, all Real Property Assets) insured at
all times with financially sound and reputable insurance companies, against such
risks, in such amounts, and with such deductions as is customary for companies
of the same or similar size in the same or similar businesses; provided, that
such insurance shall (i) insure the assets (including, without limitation, all
Real Property Assets and all Collateral) of the Credit Parties (other than motor
vehicles) against all risk of loss or damage including, without limitation, loss
by fire, explosion, theft and such other casualties as may be reasonably
satisfactory to the Administrative Agent, and (ii) insure the Credit Parties,
and the Agents, the Issuing Bank and the Lenders against comprehensive general
and automobile liability, such policies to be in accordance with customary
industry practice and in such form and amounts and having such coverage as is
customary for companies of the same or similar size in the same or similar
businesses or as otherwise may be reasonably satisfactory to the Administrative
Agent. All such insurance shall (i) contain a Lender's Loss Payable Endorsement
in favor of the Administrative Agent on behalf of the Secured Parties in all
loss or damage insurance policies, (ii) provide that no cancellation, material
reduction in amount or material change in coverage thereof shall be effective
until at least thirty (30) days after written notice to the Administrative Agent
(on behalf of the Secured Parties) thereof, (iii) name the Administrative Agent
(for the benefit of the Secured Parties) as loss payee for physical damage
insurance with respect to property which constitutes Collateral or a Real
Property Asset as to which a Lien has been granted to the Administrative Agent,
with the right, if an Event of Default has occurred and is then continuing, to
adjust losses and claims with respect to such property, and as an additional
insured for liability insurance (provided, that with respect to property to
which a Lien permitted hereunder has been granted to another creditor, such
other creditor may also be named as loss payee, with payment to be made as their
interests may appear and as an additional insured, with the Administrative
Agent), (iv) state that neither the Agents, any of the Lenders, nor any other
Secured Party shall be responsible for premiums, commissions, club calls,
assessments or advances and (v) be reasonably satisfactory in all other respects
(including deductibles) to the Administrative Agent.
(b) Upon the request of the Administrative Agent, furnish to
the Administrative Agent, an updated schedule describing all insurance
maintained by the Credit Parties, which schedule shall set forth, for each
insurance policy, the policy number, the type of coverage, the policy limits and
deductibles, the insurer and the expiration date.
(c) Furnish to the Administrative Agent, to the extent not
previously delivered, original certificates of insurance for all insurance
maintained by a Credit Party which certificates shall comply with the
requirements of this Section 5.5 set forth above and contain signatures of duly
authorized representatives of the insurer, at all times prior to policy
termination, cessation or cancellation.
(d) Maintain such other insurance or self insurance as may be
required by Applicable Law or any agreement to which any Credit Party is a party
or as the Administrative Agent may reasonably request.
SECTION 5.6 Books and Records. (a) Maintain or cause to be
maintained at all times, in accordance with GAAP, true and complete books and
records of its financial operations.
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(b) Provide any Agent, the Issuing Bank and their
representatives (at the Borrower's expense) or any Lender and its
representatives (at such Lender's expense) access to such books and records and
to any of its properties or assets upon reasonable notice and during regular
business hours in order that such Agent, the Issuing Bank or such Lender (as
applicable) may make such audits and examinations and make abstracts from such
books, accounts, records and other papers of a Credit Party pertaining to the
Collateral or any Real Property Asset and upon notification to the Borrower,
permit such Agent, the Issuing Bank or such Lender (as applicable) or its
representatives to discuss the affairs, finances and accounts with, and be
advised as to the same by, officers and independent accountants, all as such
Agent, the Issuing Bank or such Lender (as applicable) may deem appropriate for
the purpose of verifying any report delivered by any Credit Party to any of the
Agents, the Issuing Bank and/or the Lenders pursuant to this Credit Agreement or
for otherwise ascertaining compliance with this Credit Agreement or any other
Fundamental Document.
SECTION 5.7 Observance of Material Agreements. (a) Duly
observe and perform all terms and conditions of any Material Agreement and
diligently protect and enforce the rights of the Credit Parties under all such
Material Agreements to the extent and in a manner consistent with prudent
business judgement.
(b) Promptly provide the Agents copies of any and all
agreements amending, altering, modifying, waiving or supplementing in any
material respect the ElderCare Subordinated Note Indenture and any other
Material Agreement.
(c) Maintain in effect all material Regulatory Licenses and
material Reimbursement Approvals necessary to the operation of its business.
(d) Except where the failure to participate or comply could
not reasonably be expected to have a Material Adverse Effect, continue its
participation in all Third Party Payor Arrangements and comply with all rules,
regulations, standard procedures and decrees necessary to continue its
participation in such Third Party Payor Arrangements and prepare and file all
applicable cost reports with respect to such Third Party Payor Arrangements.
SECTION 5.8 Taxes and Charges. Duly pay and discharge, or
cause to be paid and discharged, before the same shall become in arrears (after
giving effect to applicable extensions), all taxes, assessments, levies and
other governmental charges, in any material amount imposed upon any Credit Party
or its properties, sales and activities, or any part thereof, or upon the income
or profits therefrom, as well as all claims for labor, materials, or supplies
which if unpaid might by law become a Lien upon any property of any Credit
Party; provided, however, that any tax, assessment, levy, governmental charge or
claim for labor, material or supplies need not be paid if the validity or amount
thereof shall currently be contested in good faith by appropriate proceedings
and if such Credit Party shall have set aside on its books reasonable reserves
(the presentation of which is segregated to the extent required by GAAP) with
respect thereto if such reserves are required by GAAP; and provided, further,
that such Credit Party will pay all such taxes, assessments, levies or other
governmental charges and claims for labor, material or supplies forthwith upon
the commencement of proceedings to foreclose any Lien which may have attached as
security therefor.
SECTION 5.9 Liens. Defend the Collateral (including, without
limitation, the Pledged Securities) and the Real Property Assets against any and
all Liens, claims and other impediments howsoever arising, other than Permitted
Liens, and in any event defend the same against any attempted foreclosure.
SECTION 5.10 Further Assurances; Security Interests. (a) Upon
the request of any of the Agents, duly execute and deliver, or cause to be duly
executed and delivered, at the cost and expense of the Credit Parties, such
further instruments as may be necessary in the reasonable judgment of such Agent
or its counsel to carry out the provisions and purposes of this Credit Agreement
and the other Fundamental Documents.
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(b) Upon the request of the Administrative Agent, promptly
execute and deliver or cause to be executed and delivered, at the cost and
expense of the Credit Parties, such further instruments as may be appropriate in
the reasonable judgment of such Agent or its counsel, to provide the
Administrative Agent for the benefit of the Secured Parties a first perfected
Lien in the Collateral and all the Real Property Assets, and any and all
documents (including, without limitation, an amendment or supplement of any
financing statement and a continuation statement or other statement) for filing
under the provisions of the UCC and the rules and regulations thereunder, or any
other Applicable Law of the United States or any other jurisdiction which any
Agent may deem reasonably necessary or advisable, and perform or cause to be
performed such other ministerial acts which are reasonably necessary or
advisable, from time to time, in order to grant and maintain in favor of the
Administrative Agent for the benefit of the Secured Parties the security
interest in the Collateral and the Real Property Assets contemplated hereunder
and under the other Fundamental Documents, subject only to Permitted Liens.
(c) Promptly undertake to deliver or cause to be delivered to
the Administrative Agent from time to time such other documentation, consents,
authorizations and approvals, in form and substance reasonably satisfactory to
the Administrative Agent, as the Administrative Agent or its counsel shall deem
reasonably necessary or advisable to perfect or maintain the Liens of the
Administrative Agent for the benefit of the Secured Parties.
SECTION 5.11 Environmental Laws. (a) Promptly notify the
Administrative Agent upon any Credit Party gaining actual knowledge of any
violation or non-compliance with, or liability or potential liability under, any
Environmental Laws which, when taken together with all other violations of, or
liability under, Environmental Law is reasonably expected to have a Material
Adverse Effect, and promptly furnish to the Administrative Agent all written
notices of any nature which any Credit Party may receive from any Governmental
Authority or other Person with respect to any violation, or potential violation
or non-compliance with, or liability or potential liability under, any
Environmental Laws which, in any case or when taken together with all such other
notices, could reasonably be expected to have a Material Adverse Effect.
(b) Comply with and use reasonable efforts to ensure
compliance by all tenants and subtenants with all Environmental Laws, and obtain
and comply in all respects with and maintain and use reasonable efforts to
ensure that all tenants and subtenants obtain and comply in all respects with
and maintain any and all Environmental Permits required by Environmental Laws,
except where failure to do so is not reasonably likely to have a Material
Adverse Effect.
(c) Conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under all
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities, except where failure to
do so would not have a Material Adverse Effect. Any order or directive whose
lawfulness is being contested in good faith by appropriate proceedings shall be
considered a lawful order or directive when such proceedings, including any
judicial review of such proceedings, have been finally concluded by the issuance
of a final non-appealable order; provided, however, that the appropriate Credit
Party shall have set aside on its books reasonable reserves (the presentation of
which is segregated to the extent required by GAAP) with respect thereto.
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(d) Indemnify, defend and hold harmless the Agents, the
Issuing Bank, the Lenders and the other Secured Parties, and their respective
officers, directors, shareholders, employees, agents, representatives,
successors and assigns from and against any liability, fine, penalty, loss,
damage, suit, settlement, action, expense and cost (including, but not limited
to, reasonable attorneys' fees (including cost of in-house counsel) and
environmental consultant fees), arising out of or relating to: (A) the presence
or Release of any Hazardous Materials at, to, on, under, from, or about any
Premises; (B) any violation of any Environmental Law or Environmental Permit by
any Credit Party; (C) the transportation or the arrangement for the
transportation, handling, treatment, or disposal of any Hazardous Materials to
any location other than any Premises by or on behalf of any Credit Party; (D)
any Environmental Claim relating to any Premises or any activities conducted at
any Premises; and (E) any breach of any environmental representation or covenant
in this Credit Agreement or any other Fundamental Document (but excluding any
such liability, fine, penalty, loss, damage, suit, settlement, action, expense
or cost of an indemnified party to the extent primarily caused by the gross
negligence or willful misconduct of such indemnified party as determined by a
final judgment of a court of competent jurisdiction). The obligations of the
Borrower under this Section 5.11(d) shall survive the Facility Termination Date,
the termination of this Credit Agreement, the payment of the Obligations and the
expiration, termination and/or cancellation of the Letters of Credit hereunder
indefinitely.
SECTION 5.12 Subsidiaries. Except with respect to any Excluded
Assets, any Unrestricted Subsidiaries or as may otherwise be agreed in writing
by the Administrative Agent, deliver to the Administrative Agent reasonably
promptly after formation or acquisition of any new Subsidiary (but in any event
prior to commencement of operations by such Subsidiary), (i) an Instrument of
Assumption and Joinder executed by such Subsidiary, (ii) appropriate UCC-1
financing statements, Mortgages and/or other security documents, organizational
documents and written opinions of counsel, all as may be reasonably requested by
the Administrative Agent or its counsel and all in form and substance reasonably
satisfactory to the Agents and their counsel and (iii) if applicable,
certificates or other instruments (if any) representing all of the Capital Stock
of such Subsidiary together with an undated stock power (or other appropriate
document) executed in blank for each such certificate or other instrument.
SECTION 5.13 Lease Agreements. From time to time (i) furnish
to the Administrative Agent such information and reports regarding any lease
agreement with respect to a Real Property Asset to which a Credit Party is a
party as the Administrative Agent may reasonably request and (ii) upon the
occurrence and continuation of an Event of Default and the reasonable request of
the Administrative Agent, make such demands and requests for information,
reports or action to the other parties to a lease agreement to which a Credit
Party is a party, as the Credit Party is entitled to make under each such lease
agreement.
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SECTION 5.14 After-Acquired Real Property Assets. If, after
the Closing Date, any Credit Party purchases, leases or otherwise acquires any
Real Property Asset, or if any existing mortgage or deed of trust encumbering
any Real Property Asset in favor of a third party is released (a) promptly, but
in any event within thirty (30) days, after such purchase, lease or other
acquisition or release, provide written notice thereof to the Administrative
Agent, setting forth with specificity a description of such Real Property Asset
acquired, a title commitment, a survey (if available) and such Credit Party's
good faith estimate of the current fair market value of such Real Property Asset
and (b) if the Agents so request, the applicable Credit Party shall promptly
execute and deliver to the Administrative Agent, a Mortgage and such other
documents or instruments as such Agents shall reasonably request with respect to
such Real Property Asset.
SECTION 5.15 Lender Meetings. From time to time as requested
by the Administrative Agent or the Required Lenders, participate in, and cause
an Authorized Officer of the Borrower to be available for and to participate in,
a meeting of Lenders to be held, at reasonable intervals, at locations and at
times reasonably requested by the Administrative Agent (or, if applicable, the
Required Lenders).
SECTION 5.16 Use of Proceeds of Revolving Credit Loans. Use
the proceeds of the Loans for the purposes which are not otherwise prohibited by
the terms of this Credit Agreement, including, without limitation, Sections
2.1(b) and 2.2(b).
SECTION 5.17 Cash Management System. At all times maintain or
cause to be maintained an integrated cash management system in accordance with
the terms of Section 8.3 hereof.
SECTION 5.18 ERISA Plan Compliance and Reports. Furnish to the
Administrative Agent (i) as soon as possible, and in any event within ten (10)
days after any executive officer of a Credit Party has knowledge that (A) any
Reportable Event with respect to any Plan has occurred, a statement of an
executive officer of the Credit Party, setting forth on behalf of such Credit
Party details as to such Reportable Event and the action which it proposes to
take with respect thereto, together with a copy of the notice, if any, required
to be filed of such Reportable Event given to the PBGC or (B) an accumulated
funding deficiency has been incurred or an application has been made to the
Secretary of the Treasury for a waiver or modification of the minimum funding
standard or an extension of any amortization period under Section 412 of the
Code with respect to a Plan or Multiemployer Plan has been or is proposed to be
terminated, reorganized, partitioned or declared insolvent under Title IV of
ERISA, proceedings have been instituted to terminate a Plan if such Plan is
subject to Title IV of ERISA, an action has been instituted pursuant to Section
515 of ERISA to collect a delinquent contribution to a Multiemployer Plan, or
any such Credit Party or ERISA Affiliate will incur any liability to or on
account of the termination of or withdrawal from a Plan subject to Title IV of
ERISA or Multiemployer Plan under Section 4062, 4063, 4201 or 4204 of ERISA, a
statement of an executive officer of the Credit Party, setting forth full
details as to such event and the action the applicable Credit Party proposes to
take with respect thereto, (ii) promptly upon reasonable request of the
Administrative Agent, copies of each annual and other report with respect to
each Plan and (iii) promptly after receipt thereof, a copy of any notice any
Credit Party or ERISA Affiliate may receive from the PBGC relating to the PBGC's
intention to terminate any Plan subject to Title IV of ERISA or to appoint a
trustee to administer any Plan subject to Title IV of ERISA.
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6. NEGATIVE COVENANTS
From the date hereof and for so long as any Commitments shall
be in effect, any amount remains outstanding with respect to any Loan, any
Letter of Credit shall remain outstanding (or not cash collateralized in an
amount equal to 105% of the then current L/C Exposure) or any other Obligation
remains unpaid or unsatisfied, each Credit Party agrees that, unless the
Required Lenders shall otherwise consent in writing, it will not:
SECTION 6.1 Limitations on Indebtedness and Disqualified
Capital Stock. Incur, create, assume or suffer to exist any Disqualified Capital
Stock or Indebtedness, other than:
(a) the Indebtedness and other Obligations under this Credit
Agreement, and any Indebtedness extending, renewing or refinancing all or any
portion of the Indebtedness and/or other Obligations under this Credit
Agreement; provided, that the terms of any Indebtedness refinancing only a
portion of the Indebtedness and other Obligations under this Credit Agreement
shall have been approved in writing by the Administrative Agent and the Required
Lenders;
(b) Intentionally omitted;
(c) existing Indebtedness described on Schedule 6.1 hereto;
(d) Indebtedness in respect of intercompany advances
constituting Investments permitted under Section 6.4 hereof;
(e) Intentionally Omitted;
(f) Indebtedness incurred under Interest Rate Protection
Agreements to the extent entered into by the applicable Credit Party for bona
fide hedging purposes;
(g) Indebtedness of a Person which becomes a Credit Party
after the Closing Date in connection with a Permitted Acquisition; provided,
that (i) such Indebtedness existed at the time the Person became a Credit Party
and was not created in anticipation of the acquisition of such Person, (ii)
immediately after giving effect to the Permitted Acquisition of such Person by a
Credit Party, no Default or Event of Default shall have occurred and be
continuing, (iii) such Indebtedness is non-recourse to the Borrower or any other
Credit Party (other than such Person to the extent such Indebtedness was with
recourse to such Person at the time such Person became a Credit Party) and (iv)
the aggregate outstanding principal amount of Indebtedness of all of the Credit
Parties permitted by this Section 6.1(g) shall not exceed $15,000,000 at any
time;
(h) Indebtedness secured by any asset at the time of
acquisition of such asset by a Credit Party (not in violation of any of the
terms hereof) at any time after the Closing Date; provided, that (i) such
Indebtedness existed at the time the asset was acquired by a Credit Party and
was not created in anticipation of the acquisition thereof, (ii) such
Indebtedness is non-recourse to the Borrower or any other Credit Party (other
than to the specific asset acquired) and (iii) the aggregate outstanding
principal amount of Indebtedness of all of the Credit Parties permitted by this
Section 6.1(h) shall not exceed $10,000,000 at any time;
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(i) Guarantees permitted pursuant to Section 6.3 hereof;
(j) deferred payment obligations resulting from the
adjudication or settlement of any litigation involving a Credit Party; provided,
that (i) the aggregate amount of such obligations for all of the Credit Parties
shall not exceed $10,000,000 (except as covered by Insurance) at any time and
(ii) the judgment(s) to which such obligations relate would not be an Event of
Default hereunder;
(k) Subordinated Debt;
(l) other Indebtedness in an aggregate principal amount at any
time outstanding not exceeding $25,000,000;
(m) Indebtedness assumed as part of the ElderTrust
Transactions not to exceed $18,000,000 in the aggregate;
(n) assumed Indebtedness in an amount not to exceed $8,000,000
in connection with the Somerset/▇▇▇▇▇ ▇▇▇▇▇▇▇ Transaction; and
(o) any Indebtedness extending, renewing or refinancing all or
any portion of any Indebtedness described in paragraph (c), (g), (h) or (m) of
this Section 6.1, but only to the extent effected on substantially the same
terms or terms more favorable to the applicable Credit Party which is the
obligor of such Indebtedness (provided, that the interest rate may be at the
then prevailing rate for the same type of Indebtedness),
SECTION 6.2 Limitations on Liens. Incur, create, assume or
suffer to exist any Lien on any of its revenue stream, property or assets,
whether now owned or hereafter acquired, except:
(a) deposits under worker's compensation, unemployment
insurance and social security and similar laws or to secure statutory
obligations or surety, appeal, performance, completion or other similar bonds,
to secure performance as lessee under leases of real or personal property or to
secure performance of tenders, bids, contracts (other than for the repayment of
Indebtedness) and other obligations of a like nature, in each case incurred in
the ordinary course of business;
(b) Liens customarily granted or incurred in the ordinary
course of business with regard to services rendered by carriers, warehouses,
suppliers of materials and equipment, mechanics and repairmen and other Liens
imposed by Applicable Law which obligations are not yet due and payable (unless
such obligations are being contested in good faith and with respect to which
appropriate reserves have been established in accordance with GAAP);
(c) the Liens in favor of the Administrative Agent (for the
benefit of the Secured Parties) under this Credit Agreement, the other
Fundamental Documents and any other document contemplated hereby or thereby;
(d) existing Liens listed on Schedule 6.2 hereto;
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(e) Liens securing Indebtedness permitted pursuant to Section
6.1(l);
(f) Liens arising out of attachments, judgments or awards as
to which an appeal or other appropriate proceedings for contest or review are
timely commenced (and as to which foreclosure and other enforcement proceedings
shall not have been commenced (unless fully bonded or otherwise effectively
stayed)) and as to which appropriate reserves have been established in
accordance with GAAP;
(g) Liens for taxes, assessments or other governmental charges
or levies not yet due and payable, or the validity or amount of which is
currently being contested in good faith by appropriate proceedings and for which
reserves have been set aside on the books of the applicable Credit Party, in
each case pursuant to and in accordance with the terms of Section 5.8 hereof;
(h) financing statements filed in connection with a Capital
Lease or an operating lease, in each case not prohibited hereunder; provided,
that no such financing statement extends, covers or refers to any property or
assets of a Credit Party, other than the property or assets which are subject to
such Capital Lease or such operating lease;
(i) easements (including, without limitation, reciprocal
easement agreements and utility agreements), rights of way requirements,
restrictions (including, without limitation, zoning restrictions), covenants,
consents, reservations, encroachments, variations and other similar
restrictions, charges, encumbrances (whether or not recorded) (but specifically
excluding rights of first refusal, options and other contractual rights to sell,
assign or otherwise dispose of any Real Property Asset or any interest therein)
on any Real Property Asset which, in the aggregate, (i) do not materially
detract from the value of the applicable Real Property Asset subject thereto,
(ii) do not materially interfere with the ordinary conduct of the business of
the Credit Parties or any lessee under a lease or (iii) do not materially impair
the use of the applicable Real Property Asset by any Credit Party or any lessee
under a lease;
(j) Liens on the property or assets of a Person which becomes
a Credit Party after the Closing Date securing Indebtedness permitted under
Section 6.1(g) hereof; provided, that (i) such Liens existed at the time such
Person became a Credit Party and were not created in anticipation of the
acquisition of such Person, (ii) any such Lien does not by its terms cover any
property or assets after the time such Person becomes a Credit Party which were
not covered immediately prior thereto, and (iii) any such Lien does not by its
terms secure any Indebtedness other than Indebtedness existing immediately prior
to the time such Person becomes a Credit Party;
(k) Liens arising by virtue of any statutory or common law
provision relating to banker's liens, rights of set off or similar rights with
respect to deposit accounts;
(l) Liens on assets at the time of acquisition of the asset by
a Credit Party; provided, that (i) such Liens existed at the time of such
acquisition and were not created in anticipation of the acquisition of such
asset, (ii) any such Lien does not by its terms cover any property or assets
other than the asset acquired, and (iii) any such Lien does not by its terms
secure any Indebtedness other than Indebtedness permitted pursuant to Section
6.1(h), 6.1(m) and 6.1(n);
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(m) Liens securing refinancing Indebtedness permitted by
Section 6.1(o); provided, that such Liens shall by their terms cover only such
property or assets as is covered by the Liens securing the Indebtedness being
refinanced and no new or additional property or assets and any Liens granted
with respect to such refinancing Indebtedness shall be subordinated to at least
the same extent as the existing Liens securing such Indebtedness being
refinanced;
(n) Liens incurred in the ordinary course of business with
respect to obligations that do not exceed $10,000,000 in the aggregate at any
one time outstanding and that are not incurred in connection with Indebtedness
or the obtaining of advances or credit (other than trade credit in the ordinary
course of business);
(o) rights of first refusal, options or other contractual
rights to sell, assign or otherwise dispose of any Real Property Asset or
interest therein which right of first refusal, option or contractual right (i)
is described on Schedule 3.10(d) hereto, (ii) has been consented to in writing
by the Administrative Agent, (iii) is in connection with an asset sale permitted
by Section 6.7 hereof or (iv) in the case of such rights granted after the
Closing Date when taken with all other rights of first refusal, options and
other contractual rights permitted by this clause (o), do not over the term of
this Credit Agreement affect Real Property Assets having an aggregate fair
market value exceeding $5,000,000;
(p) Liens on Capital Stock held by a Credit Party in any Joint
Venture, to the extent that such Lien secures debt of such Joint Venture and is
non-recourse to the applicable Credit Party except to such Capital Stock; and
(q) leases or subleases of real property to others not
interfering in any material respect with the business of the Borrower or any
Credit Party;
SECTION 6.3 Limitation on Guaranties. Incur, create, assume or
suffer to exist any Guaranty, either directly or indirectly, except:
(a) the endorsement of negotiable instruments for deposit or
collection in the ordinary course of business;
(b) the Guaranties made by the Guarantors pursuant to Article
9 hereof;
(c) Guaranties of obligations of a Credit Party which
obligations are not prohibited hereunder;
(d) Guaranties set forth on Schedule 6.1 hereto;
(e) Guaranties of Indebtedness permitted by Section 6.1
hereof; provided that Guaranties of any Subordinated Debt shall be subordinated
to the same extent as such Subordinated Debt.
(f) Guaranties constituting Investments that are not
prohibited by Section 6.4;
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(g) other Guaranties of obligations and liabilities which do
not in the aggregate expose the guarantors thereof to an amount in excess of
$10,000,000 and
(h) Guaranties by the Borrower of the obligations set forth on
Schedule 6.3 hereto.
SECTION 6.4 Limitations on Investments. Create, make or incur
any Investment, except:
(a) cash and Cash Equivalents;
(b) Investments (whether as equity or loans) by the Borrower
or a Credit Party in another Credit Party or a Person that immediately becomes a
Credit Party;
(c) Investments (whether as equity or loans) by the Borrower
or a Credit Party in Subsidiaries which are not Credit Parties; provided, that
the aggregate amount of all such Investments (other than the Investments
described in the following sentence) made by the Credit Parties after the
Closing Date in such Subsidiaries may not exceed $10,000,000 at any time. The
foregoing limitation on amount shall exclude any amounts in respect of: (i)
Investments in the captive insurance subsidiary from time to time; (ii)
Investments in Unrestricted Subsidiaries in an amount (but not an amount in
excess of the amount referred to in Section 6.7(b)(vi)) necessary to finance the
acquisition of the Riverview Ridge and Pleasant View Retirement facilities if
such facilities are acquired subject to debt pursuant to the ElderTrust
Transaction described in Section 6.7(b)(vi) ; and (iii) Investments in
Unrestricted Subsidiaries in an amount (but not an amount in excess of the
amount referred to in Section 6.7(b)(vii)) necessary to finance the
Somerset/▇▇▇▇▇ ▇▇▇▇▇▇▇ Transaction to the extent that such transactions are
effected by Unrestricted Subsidiaries;
(d) additional Investments received in settlement of
Indebtedness or other obligations created in the ordinary course of business and
owing to any Credit Party;
(e) Investments in Joint Ventures; provided, that the
aggregate amount of all such Investments of the Credit Parties made after the
Closing Date taken as a whole in Joint Ventures (including both contributions of
capital to Joint Ventures and the cost of acquiring any Joint Venture interests,
other than an acquisition of the remaining interests in any Joint Venture which
results in such Joint Venture becoming a Credit Party) may not exceed
$25,000,000 at any time;
(f) existing Investments listed on Schedule 6.4 hereto;
(g) Investments made as a result of the receipt of non-cash
consideration from an asset sale made in compliance with Section 6.7 hereof; and
(h) Guaranties permitted by Section 6.3.
SECTION 6.5 Restricted Payments. Pay, declare, make or become
obligated to make any Restricted Payment, except:
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(a) the declaration and payment of dividends and/or
distributions by any Credit Party to a Credit Party;
(b) to the extent permitted under Section 13.16 hereof,
payments with respect to intercompany Indebtedness, intercompany receivables or
intercompany advances constituting Investments permitted under Section 6.4
hereof;
(c) Intentionally Omitted.
(d) so long as no Default or Event of Default has occurred and
is continuing, required payments (but not prepayments) of interest (in cash only
to the extent required) with respect to ElderCare Subordinated Notes or any
other Subordinated Debt incurred pursuant to Section 6.1; provided, that such
payment of interest is not prohibited by the subordination provisions of such
Subordinated Debt or any subordination agreements with respect thereto;
(e) Investments permitted under Section 6.4(e) hereof; and
(f) the repurchase by the Borrower of shares of its common
stock from its shareholders at any time or times from and after the Closing
Date, provided, however, that (i) after giving effect to any such repurchase and
any borrowing entered into in order to facilitate any such repurchase, no
Default or Event of Default shall have occurred and be continuing and that the
Total Leverage Ratio is less than 2.75:1.00 and (ii) the aggregate expenditures
for all such repurchases after the Closing Date does not exceed $50,000,000.
SECTION 6.6 Intentionally Omitted
SECTION 6.7 Merger, Sale of Assets, Purchases, etc. (a)
Whether in one transaction or a series of transactions, wind up, liquidate or
dissolve its affairs, or enter into any transaction of merger or consolidation,
or sell or otherwise dispose of any capital stock of any Subsidiary of any
Credit Party, or any of its property, stock or assets or agree to or suffer any
of the foregoing, except for:
(i) the merger by any solvent Guarantor into the Borrower or
another Guarantor if after such merger, no Default or Event of Default
exists;
(ii) the transfer by any solvent Guarantor of any or all of
its assets to the Borrower or another Guarantor and, in the case of a
transfer of all of the assets of a Guarantor, the subsequent
dissolution of such solvent Guarantor if after such transactions, no
Default or Event of Default exists;
(iii) sales or other dispositions of assets (other than Real
Property Assets) in the ordinary course of business;
85
(iv) sales or dispositions of assets for fair market value,
the aggregate proceeds of which do not exceed in any fiscal year of the
Borrower and the other Credit Parties 10% of Consolidated Tangible
Assets as shown on the most recent consolidated balance sheet of the
Borrower and its Consolidated Subsidiaries; provided, however, that
sales or dispositions of assets referred to in this clause (iv) shall
be subject to the following: (A) if the sale price in any single
transaction or series of related transactions is greater than
$5,000,000 then the fair market value of such asset shall be determined
in good faith and approved by the Board of Directors of the Borrower
and the Borrower shall deliver to the Administrative Agent a
certificate of an Authorized Officer of the Borrower attesting to such
fair market value and determination by the Board of Directors, (B)
except as provided in the following sentence, not less than 75% of the
consideration received in the sale or disposition by the Credit Party
is in the form of cash, Cash Equivalents and/or assets to be used in
the business of the Credit Parties (provided, that if such assets
constitute all or substantially all of the Capital Stock in, or assets
of, a Person or a division, line of business or other business unit of
a Person, such acquisition meets the requirements of the definition of
Permitted Acquisition); (C) if such sale or disposition is to an
Affiliate, it shall be made in compliance with Section 6.14 hereof; and
(D) the applicable Credit Party shall deliver to the Administrative
Agent, no less than ten (10) Business Days prior to the date of any
expected sale or other disposition (or such shorter period as the
Administrative Agent may agree), written notice of the identity of the
purchaser or transferee, the expected date of the closing of such sale
or other disposition, the expected date of receipt by the applicable
Credit Party of the Net Cash Proceeds with respect thereto, the
principal terms of the sale or disposition and such other information
as the Administrative Agent may request. Compliance with clause (B)
above shall not be required with respect to the disposition of any
asset having a fair market value of less than $5,000,000; provided,
that the aggregate fair market value of all assets disposed of without
compliance with clause (B) above shall not exceed $25,000,000 in any
fiscal year. For purposes of clause (B) above, each of the following
shall be deemed to be cash: (x) any liabilities, as shown on the most
recent balance sheet, of the Borrower or other Credit Party (other than
contingent liabilities and liabilities that are by their terms
subordinated to the Obligations) that are assumed by the transferee of
any such assets pursuant to a customary novation agreement that
releases the Borrower or applicable Credit Party from further
liability; (y) any securities, notes or other obligations received by a
Credit Party from such transferee that are, subject to ordinary
settlement periods, converted by the Credit Party into cash within 90
days, to the extent of the cash received in that conversion; and (z)
any Designated Non-Cash Consideration received by the Borrower or other
Credit Party in the sale or disposition.
(v) the use of cash in the ordinary course of business,
subject to the provisions of this Credit Agreement;
(vi) the granting of Permitted Liens;
(vii) the consummation by way of merger of a transaction
permitted by Section 6.7(b)(ii);
(viii) the transfers of assets constituting Investments
permitted by Section 6.4 or Restricted Payments permitted by Section
6.5;
86
(ix) swaps of assets used in the business in a substantially
concurrent exchange for other assets to be used in the business (such
newly acquired asset or assets a "Swapped Asset"); provided, that (a)
the aggregate LTM EBITDA for all Swapped Assets (determined for each
Swapped Asset as of the time of exchange thereof) during the term of
this Credit Agreement shall not exceed $15,000,000, (b) after giving
effect to such asset swap on a Pro Forma Basis, no Default or Event of
Default has occurred and is continuing, (c) LTM EBITDA for the Swapped
Asset shall be at least 90% of LTM EBITDA for the asset exchanged
therefor and (d) all aspects of the asset swap (including, without
limitation, the calculation of LTM EBITDA in connection therewith)
shall be satisfactory to the Administrative Agent in its sole
discretion; and
(x) sales to ElderTrust pursuant to the exercise by ElderTrust
of the option granted to ElderTrust in the ElderTrust Agreements.
(b) Purchase or otherwise acquire all or substantially all of
any stock or assets of any other Person, except for:
(i) transactions contemplated by Sections 6.7(a)(i) and
6.7(a)(ii) above;
(ii) Permitted Acquisitions; provided that (x) in connection
with the foregoing, the appropriate Credit Parties shall take all
actions necessary or reasonably requested by the Administrative Agent
to maintain the perfection of or perfect, as the case may be, protect
and preserve the Liens on the Collateral granted to the Administrative
Agent pursuant to Article 8 hereof and otherwise comply with the
provisions of Sections 5.10, 5.12 and 5.14, in each case, on the terms
set forth therein and to the extent applicable, and (y) the aggregate
cash consideration for all Permitted Acquisitions (other than Permitted
Acquisitions constituting reinvestment of Net Cash Proceeds in
accordance with Section 2.11(c)) does not exceed $50,000,000 per fiscal
year;
(iii) the creation of new Subsidiaries which immediately
become Guarantors to the extent required by and in accordance with
Section 5.12 hereof;
(iv) Investments permitted by Section 6.4 hereof;
(v) asset swaps permitted under Section 6.7(a)(ix) hereof;
(vi) acquisitions which are part of the ElderTrust
Transactions for an aggregate consideration (exclusive of taxes, fees
and other ordinary closing-related costs of the transaction) not to
exceed $20,000,000; provided, however, if any of the facilities
acquired pursuant to the ElderTrust Transactions shall be made by
Unrestricted Subsidiaries as contemplated by Section 6.4(c) then, the
amount of cash consideration referred to in this Section 6.7(b)(vi)
shall be reduced by the amount of cash contributed to the applicable
Unrestricted Subsidiaries pursuant to Section 6.4(c) and the amount of
total consideration shall be reduced by the sum of the amount of cash
contributed to the Unrestricted Subsidiaries and the amount of debt
assumed by the Unrestricted Subsidiaries pursuant to the ElderTrust
Transactions; and
87
(vii) the purchase of Somerset and ▇▇▇▇▇ ▇▇▇▇▇▇▇ pursuant to
the Somerset/▇▇▇▇▇ ▇▇▇▇▇▇▇ Transaction for an aggregate consideration
(exclusive of taxes, fees and other ordinary closing-related costs of
the transaction) not to exceed $26,000,000; provided, however, if any
of the facilities acquired pursuant to the Somerset/▇▇▇▇▇ ▇▇▇▇▇▇▇
Transaction shall be made by Unrestricted Subsidiaries as contemplated
by Section 6.4(c) then, the amount of cash consideration referred to in
this Section 6.7(b)(vii) shall be reduced by the amount of cash
contributed to the applicable Unrestricted Subsidiaries pursuant to
Section 6.4(c) and the amount of total consideration shall be reduced
by the sum of the amount of cash contributed to the Unrestricted
Subsidiaries and the amount of debt assumed by the Unrestricted
Subsidiaries pursuant to the Somerset/▇▇▇▇▇ ▇▇▇▇▇▇▇ Transaction.
SECTION 6.8 Places of Business; Change of Name. Change its
name or change its jurisdiction of incorporation or organization, without in
each case (i) giving the Administrative Agent thirty (30) days prior written
notice of such change and (ii) filing any additional Uniform Commercial Code
financing statements, and such other documents requested by the Administrative
Agent to maintain perfection of the security interest of the Administrative
Agent for the benefit of the Secured Parties in the Collateral and in each Real
Property Asset.
SECTION 6.9 Limitations on Capital Expenditures. (a) Make or
incur any obligation to make Capital Expenditures (including obligations under
Capital Leases) which in the aggregate for each of the fiscal years indicated
below exceed the amount set forth opposite such fiscal year:
Fiscal Year Amount (in millions)
----------- --------------------
Closing Date through September 30, 2004 $50,000,000
October 1, 2004 - September 30, 2005 $55,000,000
October 1, 2005 - September 30, 2006 $60,000,000
October 1, 2006 - September 30, 2007 $62,500,000
October 1, 2007 - September 30, 2008 $65,000,000
October 1, 2008 - September 30, 2009, and each
fiscal year thereafter $65,000,000
(b) To the extent the amount of Capital Expenditures permitted
by the preceding paragraph (a) for any fiscal year (without regard to any
carry-over from a prior year pursuant to this paragraph) is in excess of the
actual amount of Capital Expenditures for such period, the amount of permitted
Capital Expenditures during the immediately succeeding fiscal year only, shall
be increased by the lesser of (i) the amount of such excess and (ii) the amount
equal to 20% of the amount of Capital Expenditures permitted by such paragraph
(a) (without regard to any carry-over from a prior year pursuant to this
paragraph) for the period with respect to which such excess exists.
SECTION 6.10 Maximum Total Leverage Ratio. For each Rolling
Four Quarters period ending on the dates indicated below, permit the Total
Leverage Ratio to be more than the corresponding ratio below:
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Period Ended Ratio
------------ -----
September 30, 2003 5.00:1.00
December 31, 2003 5.00:1.00
March 31, 2004 5.00:1.00
June 30, 2004 5.00:1.00
September 30, 2004 4.75:1.00
December 31, 2004 4.75:1.00
March 31, 2005 4.75:1.00
June 30, 2005 4.75:1.00
September 30, 2005 4.50:1.00
December 31, 2005 4.50:1.00
March 31, 2006 4.50:1.00
June 30, 2006 4.50:1.00
September 30, 2006 4.00:1.00
December 31, 2006 4.00:1.00
March 31, 2007 4.00:1.00
June 30, 2007 4.00:1.00
September 30, 2007 3.75:1.00
December 31, 2007 3.75:1.00
March 31, 2008 3.75:1.00
June 30, 2008 3.75:1.00
September 30, 2008 and each
fiscal quarter ended thereafter 3.50:1.00
SECTION 6.11 Maximum Senior Leverage Ratio. For each Rolling
Four Quarters period ending on the dates indicated below, permit the Senior
Leverage Ratio to be more than the corresponding ratio set forth below:
Period Ended Ratio
------------ -----
September 30, 2003 2.75:1.00
December 31, 2003 2.75:1.00
March 31, 2004 2.75:1.00
June 30, 2004 2.75:1.00
September 30, 2004 2.50:1.00
December 31, 2004 2.50:1.00
March 31, 2005 2.25:1.00
June 30, 2005 2.25:1.00
September 30, 2005 2.00:1.00
December 31, 2005 2.00:1.00
March 31, 2006 2.00:1.00
June 30, 2006 2.00:1.00
September 30, 2006 1.75:1.00
December 31, 2006 1.75:1.00
March 31, 2007 1.75:1.00
June 30, 2007 1.75:1.00
September 30, 2007 and each
fiscal quarter ended thereafter 1.50:1.00
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SECTION 6.12 Minimum Consolidated Fixed Charge Coverage Ratio.
For each Rolling Four Quarter period ending on the last day of each fiscal
quarter, permit the Consolidated Fixed Charge Coverage Ratio to be less than
1.75:1.00.
SECTION 6.13 Minimum Consolidated Net Worth. Permit
Consolidated Net Worth as of the close of each fiscal year (beginning with the
fiscal year ending September 30, 2004) to be less than the sum of (i) 90% of the
Consolidated Net Worth as reported in the Borrower's quarterly report on Form
10Q for the period ending December 31, 2003 plus (ii) 50% of Consolidated Net
Income (to the extent a positive number) of the Borrower and its Consolidated
Subsidiaries for each of the fiscal years ended after September 30, 2003.
SECTION 6.14 Transactions with Affiliates. Enter into any
transaction with, or make any payment to, any of its Affiliates that is less
favorable to such Credit Party or of any such Credit Party's Subsidiaries than
would have been the case if such transaction had been effected on an arms-length
basis with a Person other than an Affiliate except that (a) the Borrower may
enter into transactions with its Subsidiaries that are Credit Parties and (b)
Subsidiaries of the Borrower that are Credit Parties may enter into transactions
with other Subsidiaries of the Borrower that are Credit Parties and (c) the
investments contemplated by Section 6.4(c) and (e).
SECTION 6.15 Business Activities. Engage in any business
activities other than owning, leasing and operating any healthcare related
facility, unit, operation or business supplying healthcare services, supplies or
products, including long-term care, rehabilitation therapy, specialized health
care, health care management, and pharmacies.
SECTION 6.16 Intentionally Omitted.
SECTION 6.17 Receivables. Sell, discount or otherwise dispose
of Receivables owing to any Credit Party except (i) for purposes of collection
in the ordinary course of business or (ii) in connection with the sale of the
related Credit Party or Real Property Asset to the extent not prohibited under
Section 6.7 hereof.
SECTION 6.18 Intentionally Omitted.
SECTION 6.19 Changes to Material Agreements.
(a) Consent to any modification or waiver of any Material
Agreement listed on Schedule 3.17(b) hereto if such modification or waiver would
have a Material Adverse Effect with respect to the Credit Parties. The Borrower
will not consent to the assignment by any other party to any Material Agreement
of any rights, obligations or interests of such party thereunder except as
expressly permitted by any such Material Agreement.
(b) Amend the articles or certificate of incorporation or
by-laws of any Credit Party in any manner which could be reasonably expected to
have a Material Adverse Effect.
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SECTION 6.20 ERISA Compliance. Engage in a "prohibited
transaction," as defined in Section 406 of ERISA or Section 4975 of the Code,
with respect to any Plan or Multiemployer Plan or knowingly consent to any
"party in interest" or any "disqualified person", as such terms are defined in
Section 3(14) or ERISA and Section 4975(e)(2) of the Code, respectively,
engaging in any "prohibited transaction", with respect to any Plan or
Multiemployer Plan; or permit any Plan to incur any "accumulated funding
deficiency", as defined in Section 302 of ERISA or Section 412 of the Code; or
terminate any Plan in a manner which could result in the imposition of a Lien on
any property of any Credit Party or any ERISA Affiliate pursuant to Section 4068
of ERISA; or breach or knowingly permit any employee or officer or any trustee
or administrator of any Plan to breach any fiduciary responsibility imposed
under Title I of ERISA with respect to any Plan; engage in any transaction which
would result in the incurrence of a liability under Section 4069 of ERISA; or
fail to make contributions to a Plan or Multiemployer Plan which could result in
the imposition of a Lien on any property of any Credit Party or any ERISA
Affiliate pursuant to Section 302(f) of ERISA or Section 412(n) of the Code, if
the occurrence of any of the foregoing events (alone or in the aggregate) would
reasonably be expected to result in a liability which has a Material Adverse
Effect.
SECTION 6.21 Hazardous Materials. Cause or permit any of its
properties or assets to be used to generate, manufacture, refine, transport,
treat, store, handle, dispose, transfer, produce or process Hazardous Materials,
except in compliance with all applicable Environmental Laws; nor release,
discharge, dispose of or permit or suffer any release or disposal as a result of
any intentional act or omission on its part of Hazardous Materials onto any such
property or asset in violation of any Environmental Law or in a manner that
could result in liability under any Environmental Law, except as are not
reasonably likely to have a Material Adverse Effect.
SECTION 6.22 Use of Proceeds of Loans.
(a) Use the proceeds of any Loans hereunder other than for the
purposes set forth in, and as required by, Sections 2.1(b) and 2.2(b) hereof.
(b) Use, directly or indirectly, the proceeds of any Loan
hereunder for the purpose (whether immediate, incidental or ultimate) of buying
or carrying any Margin Stock.
SECTION 6.23 Fiscal Year; Fiscal Quarter. Change its fiscal
year or any of its fiscal quarters.
SECTION 6.24 Formation of Foreign Subsidiaries. Form or
acquire any new direct Subsidiary that is not organized within the United States
of America.
SECTION 6.25 Limitation on Restrictive Agreements. Enter into
any agreement or other arrangement which prohibits or otherwise restricts the
existence of any Lien in favor of the Administrative Agent (for the benefit of
the Lenders) except (i) for any document or instrument governing secured
Indebtedness permitted hereunder that limits Liens only on the specific property
securing such permitted secured Indebtedness, (ii) any agreement which restricts
the ability to grant a security interest in Capital Stock of any Joint Venture
or any Unrestricted Subsidiary or (iii) as otherwise approved by the Agents.
91
7. EVENTS OF DEFAULT
In the case of the happening and during the continuance of any
of the following events (herein called "Events of Default"):
(a) any representation, warranty, certification or statement
made by a Credit Party in this Credit Agreement or any other Fundamental
Document to which it is a party or any statement or representation made by or on
behalf of any Credit Party in any report, financial statement, certificate or
other document furnished to any of the Agents, the Issuing Bank, any Lender or
any other Secured Party pursuant to this Credit Agreement or any other
Fundamental Document, shall prove to have been false or misleading in any
material respect when made or delivered;
(b) default shall be made in the payment of principal of any
of the Loans as and when due and payable, whether at the due date thereof, by
reason of maturity, mandatory prepayment, acceleration or otherwise;
(c) default shall be made in the payment of interest on the
Loans, the Fees, the Letter of Credit Fees or other amounts payable to any of
the Agents, the Issuing Bank or a Lender under this Credit Agreement, under any
Interest Rate Protection Agreement or under the fee letter with respect to any
Letter of Credit or under the Fee Letter, when and as the same shall become due
and payable, whether at the due date thereof or at a date fixed for prepayment
thereof or by acceleration thereof or otherwise and such default shall continue
unremedied for two (2) Business Days;
(d) default shall be made in the due observance or performance
of any covenant, condition or agreement contained in Sections 5.1(a) (other than
5.1(a)(vi)), 5.4(a)(i), 5.5(a), 5.17 or Article 6 of this Credit Agreement;
(e) default shall be made by any Credit Party in the due
observance or performance of any other covenant, condition or agreement to be
observed or performed pursuant to the terms of this Credit Agreement or any
other Fundamental Document (other than those covered by paragraphs (a), (b), (c)
or (d) of this Article 7), and such default shall continue unremedied for thirty
(30) days after a Credit Party receives written notice or obtains knowledge of
such occurrence;
(f) default shall be made with respect to payment of the
ElderCare Subordinated Notes or any other event of default shall occur under the
ElderCare Subordinated Note Indenture;
(g) default shall be made with respect to any payment, when
due, of any Indebtedness in excess of $10,000,000 (other than the Obligations
and the ElderCare Subordinated Notes) of any Credit Party or any other default
shall occur, if the effect of such non-payment default is to accelerate the
maturity of such Indebtedness or to permit the holder thereof to cause such
Indebtedness to become due prior to its stated maturity, and such default shall
not be remedied, cured, waived or consented to within the period of grace with
respect thereto, or any other circumstance which arises (other than the mere
passage of time) by reason of which any Credit Party (as applicable) is required
to repurchase or offer to holders of Indebtedness of any such Person, the
opportunity to have repurchased, any such Indebtedness; or any such Indebtedness
shall become or be declared to be due and payable prior to its stated maturity;
92
(h) any Credit Party shall generally not pay its debts as they
become due or shall admit in writing its inability to pay its debts, or shall
make a general assignment for the benefit of creditors; or any Credit Party
shall commence any case, proceeding or other action seeking to have an order for
relief entered on its behalf as a debtor or to adjudicate it a bankrupt or
insolvent or seeking reorganization, arrangement, adjustment, liquidation,
dissolution or composition of it or its debts under any law relating to
bankruptcy, insolvency, reorganization or relief of debtors or seeking
appointment of a receiver, trustee, custodian or other similar official for it
or for all or any substantial part of its property or shall file an answer or
other pleading in any such case, proceeding or other action admitting the
material allegations of any petition, complaint or similar pleading filed
against it or consenting to the relief sought therein; or any Credit Party shall
take any action to authorize, or in contemplation of, any of the foregoing;
(i) any involuntary case, proceeding or other action against
any Credit Party shall be commenced seeking to have an order for relief entered
against it as debtor or to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, liquidation, dissolution or composition
of it or its debts under any law relating to bankruptcy, insolvency,
reorganization or relief of debtors, or seeking appointment of a receiver,
trustee, custodian or other similar official for it or for all or any
substantial part of its property, and such case, proceeding or other action (i)
results in the entry of any order for relief against it or (ii) shall remain
undismissed for a period of sixty (60) days;
(j) one or more judgment(s) for the payment of money in excess
of $10,000,000 in the aggregate (other than a judgment as to which, and only to
the extent, a reputable insurance company has acknowledged coverage of such
claim in writing) shall be rendered against any Credit Party and either (i)
within thirty (30) days from the entry of such judgment, shall not have been
discharged or stayed pending appeal, or shall not have been discharged within
thirty (30) days from the entry of a final order of affirmance on appeal or (ii)
enforcement proceedings shall be commenced by any creditor on any such judgment;
(k) (i) failure by any Credit Party or ERISA Affiliate to make
any contributions required to be made to a Plan subject to Title IV of ERISA or
a Multiemployer Plan, (ii) any accumulated funding deficiency (within the
meaning of Section 412 of the Code or Section 302 of ERISA) shall exist with
respect to any Plan (whether or not waived), (iii) failure by any Plan to
satisfy the minimum funding standard required for any plan year or part thereof
under Section 412 of the Code or Section 302 of ERISA or a waiver of such
standard or an extension of any amortization period is sought or granted under
Section 412 of the Code or Section 303 or 304 of ERISA, (iv) any Credit Party or
ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan
that it has incurred withdrawal liability to such Multiemployer Plan, or that a
Multiemployer Plan is in reorganization or is being terminated, (v) a Reportable
Event with respect to a Plan shall have occurred, (vi) the withdrawal by any
Credit Party or ERISA Affiliate from a Plan during a plan year in which it was a
substantial employer (within the meaning of Section 4001(a)(2) or 4062(e) of
ERISA), (vii) the termination of a Plan, or the filing of a notice of intent to
terminate a Plan under Section 4041(c) of ERISA, (viii) the institution of
proceedings to terminate, or the appointment of a trustee with respect to, a
Plan by the PBGC, (ix) any other event or condition which could constitute
grounds under Section 4042(a) of ERISA for the termination of, or the
appointment of a trustee to administer, any Plan, or (x) the imposition of a
Lien pursuant to Section 412 of the Code or Section 302 of ERISA as to any
Credit Party or ERISA Affiliate; and the occurrence of any of the foregoing
events, individually or in the aggregate, could reasonably be expected to result
in a liability in excess of $1,000,000;
93
(l) any Credit Party is liable for a violation or liability
under any Environmental Law which is reasonably likely to have a Material
Adverse Effect;
(m) (i) this Credit Agreement, any Mortgage, or any other
Fundamental Document shall, for any reason, not be or shall cease to be in full
force and effect (except in accordance with its terms) or shall be declared null
and void or any of the Fundamental Documents shall not give or shall cease to
give the Administrative Agent the Liens or material rights, powers and
privileges purported to be created thereby in favor of the Administrative Agent
for the benefit of the Secured Parties, superior to and prior to the rights of
all third Persons and subject to no other Liens (other than Permitted Liens),
except as the same shall be terminated in accordance with this Credit Agreement
or the terms of the applicable Fundamental Documents, or (ii) the validity or
enforceability of the Liens granted, to be granted, or purported to be granted,
by any of the Fundamental Documents shall be contested by any Credit Party or
any of their respective Affiliates;
(n) a Change in Control shall occur and shall not have been
consented to by the Required Lenders;
(o) at any time, for any reason, any Credit Party shall
repudiate, or seek to repudiate, any of its Obligations under any Fundamental
Document to which it is a party; and
(p) there shall be any revocations, suspensions, terminations,
recessions, non-renewals or forfeitures or similar actions with respect to one
or more Regulatory Licenses or Reimbursement Approvals, which individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect;
then, in every such event and at any time thereafter during the continuance of
such event, the Administrative Agent may, and if directed by the Required
Lenders shall, take any or all of the following actions, at the same or
different times: (x) terminate forthwith the Commitments and/or (y) declare the
principal of and the interest on the Loans and the notes evidencing the Loans
hereunder and all other amounts payable hereunder or thereunder to be forthwith
due and payable, whereupon the same shall become and be forthwith due and
payable, without presentment, demand, protest, notice of acceleration or other
notice of any kind, all of which are hereby expressly waived, anything in this
Credit Agreement or in any note evidencing any Loan hereunder to the contrary
notwithstanding and/or (z) require the Borrower to deliver to the Administrative
Agent from time to time cash or Cash Equivalents in an amount equal to 105% of
the amount of the L/C Exposure or to furnish other security therefor acceptable
to the Issuing Bank and the Required Revolving Credit Lenders. If an Event of
Default specified in paragraphs (h) or (i) above shall have occurred, the
Commitments shall automatically terminate and the principal of, and interest on,
the Loans and the notes evidencing the Loans hereunder and all other amounts
payable hereunder and thereunder shall automatically become due and payable
without presentment, demand, protest, or other notice of any kind, all of which
are hereby expressly waived, anything in this Credit Agreement or any note
evidencing any Loan hereunder to the contrary notwithstanding. Such remedies
shall be in addition to any other remedy available to any of the Secured Parties
pursuant to Applicable Law or otherwise.
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8. GRANT OF SECURITY INTEREST; REMEDIES
SECTION 8.1 Security Interests. The Borrower, as security for
the due and punctual payment of the Obligations (including interest accruing on
and after the filing of any petition in bankruptcy or of reorganization of the
Borrower whether or not post filing interest is allowed in such proceeding) and
each of the Guarantors, as security for its obligations under Article 9 hereof,
hereby mortgage, pledge, assign, transfer, set over, convey and deliver to the
Administrative Agent (for the benefit of the Secured Parties) and grant to the
Administrative Agent (for the benefit of the Secured Parties) a security
interest in the Collateral; provided, however, that the Credit Parties grant a
security interest unto the Administrative Agent (for the benefit of the Secured
Parties) in their right, title and interest in, to and under their Rights in
Government Receivables only to the extent that such grant of a security interest
is not prohibited by non-waivable provisions of Applicable Law, but the terms of
this proviso shall not affect the Credit Parties' grant and creation of a Lien
on Rights in Government Receivables in favor of the Administrative Agent (for
the benefit of the Secured Parties).
SECTION 8.2 Use of Collateral. So long as no Event of Default
shall have occurred and be continuing, and subject to the various provisions of
this Credit Agreement and the other Fundamental Documents, a Credit Party may
use the Collateral in any lawful manner except as otherwise provided hereunder.
SECTION 8.3 Cash Management System.
(a) The Credit Parties shall at all times maintain in all
material respects their current cash management system as in effect as of the
date hereof or cause to be maintained another cash management system reasonably
acceptable to the Administrative Agent.
(b) The Credit Parties shall promptly transfer or cause to be
transferred all funds arising from the collection of Receivables other than
Medicare Receivables to one or more of the Concentration Accounts set forth on
Schedule 8.3(b) hereto.
(c) The Credit Parties shall promptly transfer or cause to be
transferred all funds arising from the collection of Medicare Receivables to one
or more of the Medicare Receivable Concentration Accounts set forth on Schedule
8.3(c).
(d) So long as no Event of Default shall have occurred and be
continuing, the Credit Parties shall have free access to the funds in the
Concentration Accounts and the Medicare Receivable Concentration Accounts. Upon
the occurrence and during the continuation of an Event of Default, the
Administrative Agent (for the benefit of the Secured Parties), subject to
Applicable Law, shall have the right to establish sole dominion and control over
the Concentration Accounts and each Medicare Receivable Concentration Accounts,
and the balances in such accounts shall be applied toward the payment of the
Obligations.
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(e) If any Credit Party maintains any Concentration Account or
Government Receivable Concentration Account at an institution other than the
Administrative Agent, within 45 days after the Closing Date, or such greater
period as the Administrative Agent may agree (but in no event later than 180
days after the Closing Date), the Borrower shall deliver to the Administrative
Agent an account control agreement or a blocked account agreement (in form and
substance reasonably satisfactory to the Administrative Agent) with respect to
each Concentration Account and the Government Receivable Concentration Account,
duly executed by the applicable Credit Party and the financial institution where
such account is maintained.
SECTION 8.4 Credit Parties to Hold in Trust. Upon the
occurrence and during the continuance of an Event of Default, upon the request
of the Administrative Agent, each of the Credit Parties will, upon receipt by it
of any revenue, income, profits or other sums in which a security interest is
granted by this Article 8, payable pursuant to any agreement or otherwise, or of
any check, draft, note, trade acceptance or other instrument evidencing an
obligation to pay any such sum, hold the sum or instrument in trust for the
Administrative Agent, segregate such sum or instrument from their own assets and
forthwith, without any notice, demand or other action whatsoever (all notices,
demands, or other actions on the part of any of the Agents or any other Secured
Party being expressly waived), endorse, transfer and deliver any such sums or
instruments or both, to the Administrative Agent to be applied to the repayment
of the Obligations in accordance with the provisions of Section 8.7 hereof.
SECTION 8.5 Collections, etc. Upon the occurrence and during
the continuance of an Event of Default, the Administrative Agent may, in its
sole discretion, except as prohibited or restricted by Applicable Law in the
case of Government Receivables, in its name (on behalf of the Secured Parties)
or in the name of any Credit Party or otherwise, demand, ▇▇▇ for, collect or
receive any money or property at any time payable or receivable on account of or
in exchange for, or make any compromise or settlement deemed desirable with
respect to, any of the Collateral, but shall be under no obligation so to do, or
the Administrative Agent may extend the time of payment, arrange for payment in
installments, or otherwise modify the terms of, or release, any of the
Collateral, without thereby incurring responsibility to, or discharging or
otherwise affecting any liability of, any Credit Party. The Administrative Agent
will not be required to take any steps to preserve any rights against prior
parties to the Collateral. If any Credit Party fails to make any payment or take
any action required hereunder, the Administrative Agent may, except to the
extent prohibited by Applicable Law with respect to Government Receivables, make
such payments and take all such actions as the Administrative Agent reasonably
deems necessary to protect the Administrative Agent's (on behalf of the Secured
Parties) security interests in the Collateral and/or the value thereof, and the
Administrative Agent is hereby authorized (without limiting the general nature
of the authority herein above conferred), except to the extent prohibited by
Applicable Law with respect to Government Receivables, to pay, purchase, contest
or compromise any Liens that in the judgment of the Administrative Agent appear
to be equal to, prior to or superior to the security interests of the
Administrative Agent (on behalf of the Secured Parties) in the Collateral and
any Liens not expressly permitted by this Credit Agreement.
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SECTION 8.6 Possession, Sale of Collateral, etc. Upon the
occurrence and during the continuance of an Event of Default, to the fullest
extent permitted by Applicable Law, the Administrative Agent may lawfully enter
upon the premises of any Credit Party or wherever the Collateral may be, and
take possession of the Collateral, and may demand and receive such possession
from any Person who has possession thereof, and the Administrative Agent may
take such measures as it deems necessary or proper for the care or protection
thereof, including the right to remove all or any portion of the Collateral, and
with or without taking such possession may sell or cause to be sold, whenever
the Administrative Agent shall decide, in one or more sales or parcels, at such
prices as the Administrative Agent may deem appropriate, and for cash or on
credit or for future delivery, without assumption of any credit risk, all or any
portion of the Collateral, at any broker's board or at public or private sale,
with ten (10) days' written notice to the Credit Parties of the time and place
of any such public sale or sales (which notice the Credit Parties hereby agree
is reasonable) and with such other notices as may be required by Applicable Law
and cannot be waived, and neither the Agents, the Issuing Bank, the Lenders nor
any other Secured Party shall have any liability should the proceeds resulting
from a private sale be less than the proceeds realizable from a public sale, and
the Agents, the Issuing Bank, the Lenders, any other Secured Party or any other
Person may be the purchaser of all or any portion of the Collateral so sold and
thereafter hold the same absolutely, free (to the fullest extent permitted by
Applicable Law) from any claim or right of whatever kind, including any equity
of redemption, of any Credit Party, any such demand, notice, claim, right or
equity being hereby expressly waived and released. At any sale or sales made
pursuant to this Article 8, the Agents, the Issuing Bank, the Lenders and the
other Secured Parties may bid for or purchase, free (to the fullest extent
permitted by Applicable Law) from any claim or right of whatever kind, including
any equity of redemption, of any Credit Party, any such demand, notice, claim,
right or equity being hereby expressly waived and released, any part of or all
of the Collateral offered for sale, and may make any payment on account thereof
by using any claim for moneys then due and payable to the Agents, the Issuing
Bank, the Lenders and the other Secured Parties by any Credit Party hereunder as
a credit against the purchase price. The Agents, the Issuing Bank, the Lenders
and the other Secured Parties shall in any such sale make no representations or
warranties with respect to the Collateral or any part thereof, and neither the
Agents, the Issuing Bank, the Lenders nor any other Secured Party shall be
chargeable with any of the obligations or liabilities of any Credit Party. Each
Credit Party hereby agrees (i) that it will indemnify and hold the Agents, the
Issuing Bank, the Lenders and any other Secured Party harmless from and against
any and all claims with respect to the Collateral asserted before the taking of
actual possession or control of the relevant Collateral by the Administrative
Agent, the Issuing Bank, the Lenders or any other Secured Party pursuant to this
Article 8, or arising out of any act of, or omission to act on the part of, such
Person (other than the Agents, the Issuing Bank, the Lenders and any other
Secured Party) prior to such taking of actual possession or control by such
Secured Party (whether asserted before or after such taking of possession or
control), or arising out of any act on the part of any Credit Party or its
Affiliates or agents before or after the commencement of such actual possession
or control by such Secured Party; and (ii) neither the Agents, the Issuing Bank,
the Lenders, nor any other Secured Party shall have any liability or obligation
to any Credit Party arising out of any such claim except for acts of willful
misconduct or gross negligence as determined by a final order or judgment of a
court of competent jurisdiction. In any action hereunder, the Agents, the
Issuing Bank, the Lenders and any other Secured Party shall be entitled if
permitted by Applicable Law to the appointment of a receiver without notice, to
take possession of all or any portion of the Collateral and to exercise such
powers as the court shall confer upon the receiver. Notwithstanding the
foregoing, upon the occurrence of an Event of Default, and during the
continuation of such Event of Default, any Agent, the Issuing Bank, any Lender
and/or any other Secured Party shall be entitled to apply, without prior notice
to any of the Credit Parties, any cash or cash items constituting Collateral in
the possession of such Secured Party to payment of the Obligations.
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SECTION 8.7 Application of Proceeds on Default. Upon the
occurrence and during the continuance of an Event of Default, the balance in any
account of any Credit Party with a Lender, all other income on the Collateral,
and all proceeds from any sale of the Collateral pursuant hereto shall be
applied first toward payment of the reasonable out-of-pocket costs and expenses
paid or incurred by any Agent in enforcing this Credit Agreement, in realizing
on or protecting any Collateral and in enforcing or collecting any Obligations
or any Guaranty thereof, including, without limitation, court costs, reasonable
attorney's fees and expenses and reasonable financial consultants' fees incurred
by any Agent and then to the indefeasible payment in full in cash of the
Obligations in accordance with Section 12.2(b) hereof. Any amounts remaining
after such indefeasible payment in full shall be remitted to the appropriate
Credit Party or as a court of competent jurisdiction may otherwise direct.
SECTION 8.8 Power of Attorney. Upon the occurrence and during
the continuance of an Event of Default which is not waived in writing by the
Required Lenders, (a) each Credit Party does hereby irrevocably make, constitute
and appoint the Administrative Agent or any of its officers or designees its
true and lawful attorney-in-fact with full power in the name of the
Administrative Agent, such other Person or such Credit Party to receive, open
and dispose of all mail addressed to any Credit Party, and to endorse any notes,
checks, drafts, money orders or other evidences of payment relating to the
Collateral that may come into the possession of the Administrative Agent with
full power and right to cause the mail of such Persons to be transferred to the
Administrative Agent's own offices or otherwise, and to do any and all other
acts necessary or proper to carry out the intent of this Credit Agreement and
the grant of the security interests hereunder and under the Fundamental
Documents, and each Credit Party hereby ratifies and confirms all that the
Administrative Agent or its substitutes shall properly do by virtue hereof; and
(b) each Credit Party does hereby further irrevocably make, constitute and
appoint the Administrative Agent or any of its officers or designees its true
and lawful attorney-in-fact in the name of the Administrative Agent, such other
Person or such Credit Party (i) to enforce all of such Credit Party's rights
under and pursuant to all agreements with respect to the Collateral, all for the
sole benefit of the Administrative Agent (for the benefit of the Secured
Parties), (ii) to enter into and perform such agreements as may be necessary in
order to carry out the terms, covenants and conditions of the Fundamental
Documents that are required to be observed or performed by any Credit Party,
(iii) to execute such other and further mortgages, pledges and assignments of
the Collateral, and related instruments or agreements, as the Administrative
Agent may reasonably require for the purpose of perfecting, protecting,
maintaining or enforcing the security interests granted to the Administrative
Agent for the benefit of the Secured Parties hereunder and under the other
Fundamental Documents, and (iv) to do any and all other things necessary or
proper to carry out the intention of this Credit Agreement and the grant of the
security interests hereunder and under the other Fundamental Documents. Each of
the Credit Parties hereby ratifies and confirms in advance all that the
Administrative Agent as such attorney-in-fact or its substitutes shall properly
do by virtue of this power of attorney in accordance with the terms hereof.
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SECTION 8.9 Financing Statements, Direct Payments. Each Credit
Party hereby authorizes the Administrative Agent to file UCC financing
statements and any amendments thereto or continuations thereof and any other
appropriate security documents or instruments and to give any notices necessary
or desirable to perfect the Lien of the Administrative Agent (for the benefit of
the Secured Parties) on the Collateral, in all cases without the signature of
any Credit Party or to execute such items as attorney-in-fact for any Credit
Party; provided, that the Administrative Agent shall provide copies of any such
documents or instruments to the Borrower. Each Credit Party further authorizes
the Administrative Agent upon the occurrence of a default under Article 7(b) or
Article 7(c) hereof, and during the continuation of any such default, to notify
any account debtors or tenants that all sums payable to any Credit Party
relating to the Collateral shall be paid directly to the Administrative Agent.
SECTION 8.10 Further Assurances. Upon the request of the
Administrative Agent, each Credit Party hereby agrees to duly and promptly
execute and deliver, or cause to be duly executed and delivered, at the cost and
expense of the Credit Parties, such further instruments as may be necessary or
proper, in the reasonable judgment of the Administrative Agent, to carry out the
provisions and purposes of this Article 8 or to perfect and preserve the Liens
of the Administrative Agent for the benefit of the Secured Parties hereunder and
under the Fundamental Documents, in the Collateral or any portion thereof.
SECTION 8.11 Termination and Release. The security interests
granted under this Article 8 shall terminate on the Facility Termination Date.
Upon request by the Credit Parties (and at the sole expense of the Credit
Parties) after such termination, the Administrative Agent will take all
reasonable action and do all things reasonably necessary, including executing
UCC termination statements, to terminate the security interest granted to it
(for the benefit of the Secured Parties) hereunder. Upon the written request of
the Credit Parties, the Administrative Agent shall at the sole cost and expense
of the applicable Credit Party release its security interest (i) in all personal
property located in or appurtenant to a leased Real Property Asset upon the
expiration or termination without renewal of the lease for such Real Property
Asset , (ii) in any Collateral sold, transferred or otherwise disposed of by any
Credit Party to the extent such sale, transfer or other disposition is permitted
by and made in accordance with the terms of this Agreement and (iii) any
Collateral which is owned by any Guarantor which is released from its
obligations hereunder in accordance with Section 9.5 hereof.
SECTION 8.12 Remedies Not Exclusive. The remedies conferred
upon or reserved to the Administrative Agent in this Article 8 are intended to
be in addition to, and not in limitation of, any other remedy or remedies
available to the Administrative Agent. Without limiting the generality of the
foregoing, the Administrative Agent, the other Agents, the Issuing Bank, the
Lenders and any other Secured Party shall have all rights and remedies of a
secured creditor under Article 9 of the UCC and under any other Applicable Law.
SECTION 8.13 Continuation and Reinstatement. Each Credit Party
further agrees that the security interest granted hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment or any
part thereof of any Obligation is rescinded or must otherwise be restored by any
Agent, the Issuing Bank, any Lender or any other Secured Party upon the
bankruptcy or reorganization of any Credit Party or otherwise.
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9. GUARANTY
SECTION 9.1 Guaranty. (a) Each Guarantor unconditionally and
irrevocably, jointly and severally guarantees to the Secured Parties the due and
punctual payment by, and performance of, the Obligations (including interest
accruing on and after the filing of any petition in bankruptcy or of
reorganization of the obligor whether or not post filing interest is allowed in
such proceeding). Each Guarantor further agrees that the Obligations may be
increased, extended or renewed, in whole or in part, without notice or further
assent from it (except as may be otherwise required herein), and it will remain
bound upon this Guaranty notwithstanding any extension or renewal of any
Obligation.
(b) Each Guarantor waives presentation to, demand for payment
from and protest to, as the case may be, any Credit Party or any other guarantor
of any of the Obligations, and also waives notice of protest for nonpayment,
notice of acceleration and notice of intent to accelerate. The obligations of
each Guarantor hereunder shall not be affected by (i) the failure of any Agent,
the Issuing Bank, any Lender or any other Secured Party to assert any claim or
demand or to enforce any right or remedy against the Borrower or any Guarantor
or any other guarantor under the provisions of this Credit Agreement or any
other agreement or otherwise; (ii) any extension or renewal of any provision
hereof or thereof; (iii) the failure of any Agent, the Issuing Bank, any Lender
or any other Secured Party to obtain the consent of the Guarantor with respect
to any rescission, waiver, compromise, acceleration, amendment or modification
of any of the terms or provisions of this Credit Agreement, any notes evidencing
any of the Loans hereunder or of any other Fundamental Document or other
agreement; (iv) the release, exchange, waiver or foreclosure of any security
held by the Administrative Agent for the Obligations or any of them; (v) the
failure of any Agent, the Issuing Bank, any Lender or any other Secured Party to
exercise any right or remedy against any other Guarantor or any other guarantor
of the Obligations; or (vi) the release or substitution of any Guarantor or
guarantor.
(c) Each Guarantor further agrees that this Guaranty
constitutes a guaranty of performance and of payment when due and not just of
collection, and waives any right to require that any resort be had by any Agent,
the Issuing Bank, any Lender or any other Secured Party to any security held for
payment of the Obligations or to any balance of any deposit, account or credit
on the books of any Agent, the Issuing Bank, any Lender or any other Secured
Party in favor of the Borrower or any Guarantor, or to any other Person.
(d) Each Guarantor hereby expressly assumes all
responsibilities to remain informed of the financial condition of the Borrower,
the Guarantors and any other guarantors and any circumstances affecting the
Collateral or the Real Property Assets or the Pledged Securities or the ability
of the Borrower to perform under this Credit Agreement.
(e) Each Guarantor's obligations under the Guaranty shall not
be affected by the genuineness, validity, regularity or enforceability of the
Obligations, any notes evidencing any of the Loans hereunder or any other
instrument evidencing any Obligations, or by the existence, validity,
enforceability, perfection, or extent of any Lien on any Collateral or Real
Property Asset or Pledged Collateral securing any Obligation or by any other
circumstance relating to the Obligations which might otherwise constitute a
defense to this Guaranty. None of the Agents, the Issuing Bank, any of the
Lenders nor any other Secured Party make any representation or warranty with
respect to any such circumstances or have any duty or responsibility whatsoever
to any Guarantor in respect to the management and maintenance of the Obligations
or any collateral security for the Obligations.
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SECTION 9.2 No Impairment of Guaranty, etc. The obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason (except indefeasible payment and
performance in full in cash of the Obligations), including, without limitation,
any claim of waiver, release, surrender, alteration or compromise, or any
circumstance that might constitute a defense to, or legal or equitable discharge
of, the Borrower or any Guarantor, and shall not be subject to any defense or
set-off, counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality or unenforceability of the Obligations or otherwise.
Without limiting the generality of the foregoing, the obligations of each
Guarantor hereunder shall not be discharged or impaired or otherwise affected by
the failure of any Agent, the Issuing Bank, any Lender or any other Secured
Party to assert any claim or demand or to enforce any remedy under this Credit
Agreement or any other Fundamental Document or other agreement, by any waiver or
modification of any provision hereof or thereof, by any default, failure or
delay, willful or otherwise, in the performance of the Obligations, or by any
other act or thing or omission or delay to do any other act or thing which may
or might in any manner or to any extent vary the risk of such Guarantor or would
otherwise operate as a discharge of such Guarantor as a matter of law, unless
and until the Facility Termination Date.
SECTION 9.3 Continuation and Reinstatement, etc. (a) Each
Guarantor further agrees that its Guaranty hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
any Agent, the Issuing Bank, any Lender or any other Secured Party upon the
bankruptcy or reorganization of Borrower or a Guarantor, or otherwise. In
furtherance of the provisions of this Article 9, and not in limitation of any
other right which any Agent, the Issuing Bank, any Lender or any other Secured
Party may have at law or in equity against the Borrower, a Guarantor or any
other Person by virtue hereof, upon failure of the Borrower to pay any
Obligation when and as the same shall become due, whether at maturity, by
acceleration, after notice or otherwise, each Guarantor hereby promises to and
will, upon receipt of written demand by any Agent, the Issuing Bank, any Lender
or any other Secured Party, forthwith pay or cause to be paid to the
Administrative Agent for the benefit of the Secured Parties (as applicable) in
cash an amount equal to the unpaid amount of all the Obligations with interest
thereon at a rate of interest equal to the rate specified in Section 2.13(a)
hereof, and thereupon the Administrative Agent shall assign such Obligation,
together with all security interests, if any, then held by the Administrative
Agent in respect of such Obligation, to the Guarantors making such payment; such
assignment to be subordinate and junior to the rights of the Administrative
Agent on behalf of the Secured Parties with regard to amounts payable by the
Borrower in connection with the remaining unpaid Obligations (including interest
accruing on and after the filing of any petition in bankruptcy or of
reorganization of an obligor whether or not post filing interest is allowed in
such proceeding) and to be pro tanto to the extent to which the Obligation in
question was discharged by the Guarantor or Guarantors making such payments.
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(b) All rights of a Guarantor against the Borrower, arising as
a result of the payment by such Guarantor of any sums to the Administrative
Agent for the benefit of the Secured Parties or directly to the Secured Parties
hereunder by way of right of subrogation or otherwise, shall in all respects be
subordinated and junior in right of payment to, and shall not be exercised by
such Guarantor until and unless, the prior indefeasible payment in full in cash
of all the Obligations (including interest accruing on and after the filing of
any petition in bankruptcy or of reorganization of an obligor whether or not
post filing interest is allowed in such proceeding). If any amount shall be paid
to such Guarantor for the account of the Borrower, such amount shall be held in
trust for the benefit of the Administrative Agent, segregated from such
Guarantor's own assets, and shall forthwith be paid to the Administrative Agent
on behalf of the Secured Parties to be credited and applied to the Obligations,
whether matured or unmatured.
SECTION 9.4 Limitation on Guaranteed Amount etc.
Notwithstanding any other provision of this Article 9, the amount guaranteed by
each Guarantor hereunder shall be limited to the extent, if any, required so
that its obligations under this Article 9 shall not be subject to avoidance
under Section 548 of the Bankruptcy Code or to being set aside or annulled under
any Applicable Law relating to fraud on creditors. In determining the
limitations, if any, on the amount of any Guarantor's obligations hereunder
pursuant to the preceding sentence, it is the intention of the parties hereto
that any rights of subrogation or contribution which such Guarantor may have
under this Article 9, any other agreement or Applicable Law shall be taken into
account.
SECTION 9.5 Termination and Release. The guarantees granted
under this Article 9 shall terminate on the Facility Termination Date. Upon the
written request of the Credit Parties, the Administrative Agent shall at the
sole cost and expense of the applicable Credit Party release any Guarantor from
its obligations hereunder if (i) such Guarantor ceases to be a Subsidiary of the
Borrower or any other Credit Party as a result of any transaction that is
permitted by and effected in accordance with the terms of this Credit Agreement
or (ii) such Guarantor is designated an Unrestricted Subsidiary in accordance
with the terms of this Credit Agreement.
10. PLEDGE
SECTION 10.1 Pledge. Each Pledgor, as security for the due and
punctual payment of the Obligations (including interest accruing on and after
the filing of any petition in bankruptcy or of reorganization of the Borrower
whether or not post filing interest is allowed in such proceeding) in the case
of the Borrower and as security for its obligations under Article 9 hereof in
the case of a Pledgor which is a Guarantor, hereby pledges, hypothecates,
assigns, transfers, sets over and delivers unto the Administrative Agent for the
benefit of the Secured Parties, a security interest in all Pledged Collateral
now owned or hereafter acquired by it. The Pledgors shall deliver to the
Administrative Agent the definitive instruments (if any) representing all
Pledged Securities, accompanied by undated stock powers, duly endorsed or
executed in blank by the appropriate Pledgor, and such other instruments or
documents as the Administrative Agent or its counsel shall reasonably request.
Each delivery of securities being pledged hereunder shall be accompanied by a
schedule showing a description of the securities theretofore and then being
pledged hereunder. Each schedule so delivered shall supersede any prior
schedules so delivered.
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SECTION 10.2 Covenant. Each Pledgor covenants that as
stockholder or partner or member of each of its respective Subsidiaries (other
than Subsidiaries whose Capital Stock constitute Excluded Assets) it will not
take any action to allow any additional shares of Capital Stock or any
securities convertible or exchangeable into such Capital Stock of any such
Subsidiaries to be issued, unless such securities are pledged to the
Administrative Agent (for the benefit of the Secured Parties) as security for
the Obligations.
SECTION 10.3 Registration in Nominee Name; Denominations. Upon
the occurrence or continuation of an Event of Default, the Administrative Agent
shall have the right (in its sole discretion) to hold the certificates
representing any Pledged Securities (a) in its own name (on behalf of itself and
any of the Secured Parties) or in the name of its nominee or (b) in the name of
the appropriate Pledgor, endorsed or assigned in blank or in favor of the
Administrative Agent. Upon the occurrence or continuation of an Event of
Default, the Administrative Agent shall have the right to exchange the
certificates representing any of the Pledged Securities for certificates of
smaller or larger denominations for any purpose consistent with this Credit
Agreement.
SECTION 10.4 Voting Rights; Dividends; etc. (a) The
appropriate Pledgor shall be entitled to exercise any and all voting and/or
consensual rights and powers accruing to an owner of the Pledged Securities
being pledged by it hereunder or any part thereof for any purpose not
inconsistent with the terms hereof, at all times, except as expressly provided
in paragraph (c) below.
(b) All dividends or distributions of any kind whatsoever
(other than (x) cash dividends or (y) distributions expressly permitted by
Section 6.5 hereof) received by a Pledgor, whether resulting from a subdivision,
combination, or reclassification of the outstanding capital stock of the issuer
or received in exchange for Pledged Securities or any part thereof or as a
result of any merger, consolidation, acquisition, or other exchange of assets to
which the issuer may be a party, or otherwise, shall be and become part of the
Pledged Collateral pledged hereunder and shall immediately be delivered to the
Administrative Agent to be held subject to the terms hereof. All dividends and
distributions which are received contrary to the provisions of this subsection
(b) shall be received in trust for the benefit of the Secured Parties,
segregated from such Pledgor's own assets, and shall be delivered to the
Administrative Agent.
(c) Upon the occurrence and during the continuance of an Event
of Default and notice from the Administrative Agent of the transfer of such
rights to the Administrative Agent, all rights of a Pledgor (i) to exercise the
voting and/or consensual rights and powers which it is entitled to exercise
pursuant to this Section 10.4 and (ii) to receive and retain any dividends and
distributions, shall cease, and all such rights shall thereupon become vested in
the Administrative Agent, which shall have the sole and exclusive right and
authority to exercise such voting and/or consensual rights and receive such
dividends and distributions until such time as such Event of Default has been
cured; provided, however, that to the extent any governmental consents or
filings are required for the exercise by the Administrative Agent of any of the
foregoing rights and powers, the Administrative Agent shall refrain from
exercising such rights or powers until the making of such required filings, the
receipt of such consent and the expiration of all related waiting periods.
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SECTION 10.5 Remedies Upon Default. If an Event of Default
shall have occurred and be continuing, the Administrative Agent, on behalf of
the Secured Parties, may sell the Pledged Collateral, or any part thereof, at
public or private sale or at any broker's board or on any securities exchange,
for cash, upon credit or for future delivery as the Administrative Agent shall
deem appropriate subject to the terms hereof or as otherwise provided in the
UCC. The Administrative Agent shall be authorized at any such sale (if it deems
it advisable to do so) to restrict to the full extent permitted by Applicable
Law the prospective bidders or purchasers to Persons who will represent and
agree that they are purchasing the Pledged Collateral for their own account for
investment and not with a view to the distribution or sale thereof, and upon
consummation of any such sale, the Administrative Agent shall have the right to
assign, transfer, and deliver to the purchaser or purchasers thereof the Pledged
Collateral so sold. Each such purchaser at any such sale shall hold the property
sold absolutely, free from any claim or right on the part of any Pledgor. The
Administrative Agent shall give the Pledgors ten (10) days' written notice of
any such public or private sale, or sale at any broker's board or on any such
securities exchange, or of any other disposition of the Pledged Collateral. Such
notice, in the case of public sale, shall state the time and place for such sale
and, in the case of sale at a broker's board or on a securities exchange, shall
state the board or exchange at which such sale is to be made and the day on
which the Pledged Collateral, or portion thereof, will first be offered for sale
at such board or exchange. Any such public sale shall be held at such time or
times within ordinary business hours and at such place or places as the
Administrative Agent may fix and shall state in the notice of such sale. At any
such sale, the Pledged Collateral, or portion thereof, to be sold may be sold in
one lot as an entirety or in separate parcels, as the Administrative Agent may
(in its sole discretion) determine. The Administrative Agent shall not be
obligated to make any sale of the Pledged Collateral if it shall determine not
to do so, regardless of the fact that notice of sale of the Pledged Collateral
may have been given. The Administrative Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case the sale of all or any part of the
Pledged Collateral is made on credit or for future delivery, the Pledged
Collateral so sold shall be retained by the Administrative Agent until the sale
price is paid by the purchaser or purchasers thereof, but the Administrative
Agent shall not incur any liability in case any such purchaser or purchasers
shall fail to take up and pay for the Pledged Collateral so sold and, in case of
any such failure, such Pledged Collateral may be sold again upon like notice. At
any sale or sales made pursuant to this Section 10.5, the Administrative Agent,
any other Agent, the Issuing Bank, any Lender or any other Secured Party may bid
for or purchase, free from any claim or right of whatever kind, including any
equity of redemption, of the Pledgors, any such demand, notice, claim, right or
equity being hereby expressly waived and released, any or all of the Pledged
Collateral offered for sale, and may make any payment on the account thereof by
using any claim for moneys then due and payable to the Agents, the Issuing Bank,
the Lenders and any other Secured Party by any Credit Party as a credit against
the purchase price; and the Administrative Agent, upon compliance with the terms
of sale, may hold, retain and dispose of the Pledged Collateral without further
accountability therefor to any Pledgor or any third party (other than to the
Secured Parties). The Administrative Agent shall in any such sale make no
representations or warranties with respect to the Pledged Collateral or any part
thereof, and shall not be chargeable with any of the obligations or liabilities
of the Pledgors with respect thereto. The Administrative Agent may exercise,
either by itself or by its nominee or designee, in the name of the applicable
Pledgor(s), all of the rights, powers and remedies granted to the Administrative
Agent in this Section 10 in respect of any Pledged Collateral, any
organizational document pursuant to which any Pledgor owns its Pledged
Collateral, and may exercise and enforce all of the Administrative Agent's
rights and remedies hereunder and under law. Each Pledgor hereby agrees (i) it
will indemnify and hold each of the Agents, the Issuing Bank, the Lenders and
any other Secured Party harmless from and against any and all claims with
respect to the Pledged Collateral asserted before the taking of actual
possession or control of the Pledged Collateral by the Administrative Agent
pursuant to this Credit Agreement, or arising out of any act of, or omission to
act on the part of, any Person prior to such taking of actual possession or
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control by the Administrative Agent (whether asserted before or after such
taking of possession or control), or arising out of any act on the part of any
Pledgor, its agents or Affiliates before or after the commencement of such
actual possession or control by the Administrative Agent and (ii) the Agents,
the Issuing Bank, the Lenders and any other Secured Party shall have no
liability or obligation arising out of any such claim. As an alternative to
exercising the power of sale herein conferred upon it, the Administrative Agent
may proceed by a suit or suits at law or in equity to foreclose upon the Pledged
Collateral under this Credit Agreement and to sell the Pledged Collateral, or
any portion thereof, pursuant to a judgment or decree of a court or courts
having competent jurisdiction. All remedies under this Section 10.5 shall be
effected in compliance with the Applicable Law referred to in Section 10.7
below.
SECTION 10.6 Application of Proceeds of Sale and Cash. The
proceeds of sale of the Pledged Collateral sold pursuant to Section 10.5 hereof
shall be applied by the Administrative Agent on behalf of the Secured Parties to
the payment of all reasonable out-of-pocket costs and expenses paid or incurred
by any Agent in connection with such sale, including, without limitation, all
court costs, the reasonable fees and expenses of counsel for any Agent in
connection therewith, the reasonable fees and expenses of any financial
consultants in connection therewith and the payment of all reasonable
out-of-pocket costs and expenses paid or incurred by any Agent in enforcing this
Credit Agreement, in realizing or protecting any Collateral and in enforcing or
collecting any Obligations or any Guaranty thereof, including, without
limitation, court costs, the reasonable attorneys' fees and expenses incurred by
any Agent in connection therewith and the reasonable fees and expenses of any
financial consultants in connection therewith and then to the indefeasible
payment in full in cash of the Obligations in accordance with Section 12.2(b)
hereof. Any amounts remaining after such indefeasible payment in full shall be
remitted to the appropriate Pledgor, or as a court of competent jurisdiction may
otherwise direct.
SECTION 10.7 Effect of Certain Applicable Law. In view of the
position of each Pledgor in relation to the Pledged Securities pledged by it, or
because of other present or future circumstances, (a) a question may arise under
the Securities Act, the Exchange Act or any similar statute hereafter enacted
analogous in purpose or effect (collectively, the "Federal Securities Laws"),
and (b) a question may arise under various federal or state licensing or
regulatory laws (collectively, "Regulatory Laws"), with respect to any
disposition of the Pledged Securities permitted hereunder. Each Pledgor
understands that compliance with the Federal Securities Laws and the Regulatory
Laws may very strictly limit the course of conduct of the Administrative Agent
if the Administrative Agent were to attempt to dispose of all or any part of the
Pledged Securities, and may also limit the extent to which or the manner in
which any subsequent transferee of any Pledged Securities may dispose of the
same. Similarly, there may be other legal restrictions or limitations affecting
the Administrative Agent in any attempt to dispose of all or any part of the
Pledged Securities under applicable Blue Sky or other state securities laws, or
similar laws analogous in purpose or effect. Under Applicable Law, in the
absence of an agreement to the contrary, the Administrative Agent may perhaps be
held to have certain general duties and obligations to a Pledgor to make some
effort towards obtaining a fair price even though the Obligations may be
discharged or reduced by the proceeds of a sale at a lesser price. Each Pledgor
waives to the fullest extent permitted by Applicable Law any such general duty
or obligation to it, and the Pledgors and/or the Credit Parties will not attempt
to hold the Administrative Agent, any other Agent, the Issuing Bank, any Lender
or any other Secured Party responsible for selling all or any part of the
Pledged Securities at an inadequate price, even if the Administrative Agent
shall accept the first offer received or does not approach more than one
possible purchaser. Without limiting the generality of the foregoing, the
provisions of this Section 10.7 would apply if, for example, the Administrative
Agent were to place all or any part of the Pledged Securities for private
placement by an investment banking firm, or if such investment banking firm
purchased all or any part of the Pledged Securities for its own account, or if
the Administrative Agent placed all or any part of the Pledged Securities
privately with a purchaser or purchasers.
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SECTION 10.8 Continuation and Reinstatement. Each Pledgor
further agrees that its pledge hereunder shall continue to be effective or be
reinstated, as the case may be, if at any time payment, or any part thereof, of
any Obligation is rescinded or must otherwise be restored by any Agent, the
Issuing Bank, any Lender or any other Secured Party upon the bankruptcy or
reorganization of any Pledgor or otherwise.
SECTION 10.9 Termination and Release. The pledge referenced
herein shall terminate on the Facility Termination Date, at which time the
Administrative Agent shall assign and deliver to the appropriate Pledgor, or to
such Person or Persons as such Pledgor shall designate, against receipt, such of
the Pledged Securities (if any) as shall not have been sold or otherwise applied
by the Administrative Agent pursuant to the terms hereof and shall still be held
by it hereunder, together with appropriate instruments of reassignment and
release. Upon the written request of the Credit Parties, the Administrative
Agent shall at the sole cost and expense of the applicable Credit Party release
the pledge relating to, and assign and deliver to the appropriate Pledgor, or to
such Person or Persons as such Pledgor shall designate, any Pledged Securities
(together with appropriate instruments and reassignment and release) (i) that
are sold, transferred or otherwise disposed of by any Pledgor to the extent such
sale, transfer or other disposition is permitted by and made in accordance with
the terms of this Credit Agreement, (ii) that are subsequently designated as an
Excluded Asset in accordance with the terms of this Credit Agreement. Any
release and reassignment made pursuant to this Section 10.9 shall be free and
clear of all Liens, arising by, under or through any Lender but shall otherwise
be without recourse upon or warranty by the Administrative Agent and at the
expense of the Pledgors, or (iii) that are owned by any Guarantor which is
released from its obligations hereunder pursuant to Section 9.5 hereof.
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11. CASH COLLATERAL
SECTION 11.1 Cash Collateral Account. There shall be
established with the Administrative Agent an account (the "Cash Collateral
Account") in the name of the Administrative Agent (for the benefit of the
Secured Parties), into which the Borrower may from time to time deposit Dollars
pursuant to, and in accordance with Section 2.11(l) hereof. Except to the extent
otherwise provided in this Article 11, the Cash Collateral Account shall be
under the sole dominion and control of the Administrative Agent and shall be
subject to a control agreement entered into between the Borrower and the
Administrative Agent.
SECTION 11.2 Investment of Funds. (a) The Administrative Agent
is hereby authorized and directed to invest and reinvest the funds from time to
time deposited into the Cash Collateral Account, so long as no Event of Default
has occurred and is continuing, on the instructions of the Borrower (provided,
that any such instructions given verbally shall be confirmed promptly in
writing) or, if the Borrower shall fail to give such instructions upon delivery
of any such funds, in the sole discretion of the Administrative Agent; provided,
that in no event may the Borrower give instructions to the Administrative Agent
to, or may the Administrative Agent in its discretion, invest or reinvest funds
in the Cash Collateral Account in other than Cash Equivalents.
(b) Any net income or gain on the investment of funds from
time to time held in the Cash Collateral Account, shall be promptly reinvested
by the Administrative Agent as a part of the Cash Collateral Account; and any
net loss on any such investment shall be charged against the Cash Collateral
Account.
(c) None of the Agents, the Issuing Bank, any of the Lenders
nor any other Secured Party shall be a trustee for any of the Credit Parties, or
shall have any obligations or responsibilities, or shall be liable for anything
done or not done, in connection with the Cash Collateral Account, except as
expressly provided herein and except that the Administrative Agent shall have
the obligations of a secured party under the UCC. None of the Agents, the
Issuing Bank, any of the Lenders nor any other Secured Party shall have any
obligation or responsibility or shall be liable in any way for any investment
decision made in accordance with this Section 11.2 or for any decrease in the
value of the investments held in the Cash Collateral Account.
SECTION 11.3 Grant of Security Interest. For value received
and to induce the Issuing Bank to issue Letters of Credit and the Lenders to
enter into this Credit Agreement and to make Loans to the Borrower and to
acquire participations in Letters of Credit from time to time as provided for in
this Credit Agreement, as security for the payment of all of the Obligations,
each of the Credit Parties hereby assigns to the Administrative Agent (for the
benefit of the Secured Parties) and grants to the Administrative Agent (for the
benefit of the Secured Parties), a first and prior Lien upon all of such Credit
Party's rights in and to the Cash Collateral Account, all cash, documents,
instruments and securities from time to time held therein, and all rights
pertaining to investments of funds in the Cash Collateral Account and all
products and proceeds of any of the foregoing. All cash, documents, instruments
and securities from time to time on deposit in the Cash Collateral Account, and
all rights pertaining to investments of funds in the Cash Collateral Account
shall immediately and without any need for any further action on the part of any
of the Credit Parties, the Administrative Agent or any other Secured Party,
become subject to the Lien set forth in this Section 11.3, be deemed Collateral
for all purposes hereof and be subject to the provisions of this Credit
Agreement.
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SECTION 11.4 Remedies. At any time during the continuation of
an Event of Default, the Administrative Agent may sell any documents,
instruments and securities held in the Cash Collateral Account and may
immediately apply the proceeds thereof and any other cash held in the Cash
Collateral Account in accordance with Section 12.2(b).
12. THE AGENTS AND THE ISSUING BANK
SECTION 12.1 Administration by the Administrative Agent. (a)
The general administration of the Fundamental Documents and any other documents
contemplated by this Credit Agreement or any other Fundamental Document shall be
by the Administrative Agent or its respective designees. Except as otherwise
expressly provided herein, the Issuing Bank and each of the Lenders hereby
irrevocably authorizes the Administrative Agent, at its discretion, to take or
refrain from taking such actions as agent on its behalf and to exercise or
refrain from exercising such powers under the Fundamental Documents, any notes
evidencing any of the Loans hereunder and any other documents contemplated by
this Credit Agreement or any other Fundamental Document as are expressly
delegated by the terms hereof or thereof, as appropriate, to the Administrative
Agent together with all powers reasonably incidental thereto. None of the Agents
shall have any duties or responsibilities except as set forth in the Fundamental
Documents.
(b) The Secured Parties hereby authorize the Administrative
Agent (in its sole discretion):
(i) in connection with the sale or other disposition of any
asset included in the Collateral or in the Real Property Assets or all
of the capital stock of any Guarantor, to the extent undertaken in
accordance with the terms of this Credit Agreement, to release a Lien
granted to it (for the benefit of the Secured Parties) on such asset or
capital stock and/or to release such Guarantor from its obligations
hereunder;
(ii) to determine that the cost to the Borrower or another
Credit Party is disproportionate to the benefit to be realized by the
Agents, the Issuing Bank, the Lenders and the other Secured Parties by
perfecting a Lien in a given asset or group of assets included in the
Collateral and that the Borrower or other Credit Party should not be
required to perfect such Lien in favor of the Administrative Agent (for
the benefit of the Secured Parties);
(iii) to appoint subagents to be the holder of record of a
Lien to be granted to the Administrative Agent (for the benefit of the
Secured Parties) or to hold on behalf of the Administrative Agent such
Collateral or instruments relating thereto;
(iv) to enter into and perform its obligations under the other
Fundamental Documents; and
(v) to execute and deliver the agreements contemplated by
Section 12.13 hereof.
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SECTION 12.2 Advances and Payments. (a) On the date of each
Loan, the Administrative Agent shall be authorized (but not obligated) to
advance, for the account of each of the applicable Lenders, the amount of the
applicable Loan to be made by it in accordance with its proportionate share of
its Commitments hereunder. Each of the Lenders hereby authorizes and requests
the Administrative Agent to advance for its account, pursuant to the terms
hereof, the amount of the Loan to be made by it, and each of the Lenders agrees
forthwith to reimburse the Administrative Agent in immediately available funds
for the amount so advanced on its behalf by the Administrative Agent. If any
such reimbursement is not made in immediately available funds on the same day on
which the Administrative Agent shall have made any such amount available on
behalf of any Lender, such Lender shall pay interest to the Administrative Agent
at a rate per annum equal to the Administrative Agent's cost of obtaining
overnight funds in the New York Federal Funds Market for the first three days
following the time when the Lender fails to make the required reimbursement, and
thereafter at a rate per annum equal to the Base Rate plus the Applicable
Interest Margin for Base Rate Loans which are Revolving Credit Loans. If and to
the extent that any such reimbursement shall not have been made to the
Administrative Agent, the Borrower agrees to repay to the Administrative Agent
forthwith on demand a corresponding amount with interest thereon for each day
from the date such amount is made available to the Borrower until the date such
amount is repaid to the Administrative Agent at the Base Rate plus the
Applicable Interest Margin for Base Rate Loans which are Revolving Credit Loans.
(b) If a Default or Event of Default has occurred and is then
continuing, any amounts received by the Administrative Agent in connection with
the Fundamental Documents, the application of which is not otherwise provided
for, shall be applied as follows:
first, to pay to the Agents all unreimbursed costs and
expenses of the Agents which are payable by the Borrower or
any of the other Credit Parties pursuant to any of the
Fundamental Documents and all unreimbursed costs and expenses
of the Lenders which are payable pursuant to this Credit
Agreement; second, to pay each Lender, accrued but unpaid
interest on the Loans owed to each Lender and any fees,
premiums, scheduled periodic payments and any interest accrued
thereon owing under outstanding Hedging Agreements to each
Hedging Bank, pro rata in accordance with the amounts owed to
each such Lender and Hedging Bank; third, to pay pro rata to
each Revolving Credit Lender the accrued but unpaid Revolving
Credit Commitment Fees in accordance with each Lender's
Revolving Credit Commitment Percentage; fourth, to pay pro
rata to each Agent and each Lender all unpaid Fees; fifth, to
pay the Swingline Lender, if any Swingline Loans are
outstanding, the principal on the Swingline Loans then
outstanding; sixth, to pay to each Lender with a Loan
outstanding, principal on the Loans in accordance with the
amount of outstanding Loans owed to each Lender and to pay to
each Hedging Bank the outstanding Hedging Agreement
Obligations (including, without limitation, any breakage,
termination, or other payments, and any interest accrued
thereon, arising under any Hedging Agreement) pro rata in
accordance with the amounts owed to each Lender and each
Hedging Bank; and seventh, to pay any other amounts then due
under this Credit Agreement or any other Fundamental Document.
All amounts to be paid to any Lender by the Administrative
Agent shall be credited to that Lender, after collection by
the Administrative Agent, in immediately available funds
either by wire transfer or deposit in such Lender's
correspondent account with the Administrative Agent, or as
such Lender and the Administrative Agent shall agree in
writing from time to time.
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SECTION 12.3 Sharing of Setoffs and Cash Collateral. (a) Each
of the Lenders agrees that if it shall, through the exercise of a right of
banker's lien, set off or counterclaim against any Credit Party (including, but
not limited to, pursuant to Section 13.21 hereof or as a secured claim under
Section 506 of the Bankruptcy Code or other security or interest arising from,
or in lieu of, such secured claim and received by such Lender under any
applicable bankruptcy, insolvency or other similar law) or otherwise, obtain
payment in respect of its Loans as a result of which the unpaid portion of its
Loans is proportionately less than the unpaid portion of Loans of any of the
other Lenders (a) it shall promptly purchase at par (and shall be deemed to have
thereupon purchased) from such other Lenders a participation in the Loans of
such other Lenders, so that the aggregate unpaid principal amount of each of the
Lender's Loans and its participation in Loans of the other Lenders shall be in
the same proportion to the aggregate unpaid principal amount of all Loans then
outstanding as the principal amount of its Loans prior to the obtaining of such
payment was to the principal amount of all Loans outstanding prior to the
obtaining of such payment and (b) such other adjustments shall be made from time
to time as shall be equitable to ensure that the Lenders share any such payment
pro rata. If all or any portion of such excess payment is thereafter recovered
from the Lender which originally received such excess payment, such purchase (or
portion thereof) shall be canceled and the purchase price restored to the extent
of such recovery. The Credit Parties expressly consent to the foregoing
arrangements and agree that any Lender or Lenders holding (or deemed to be
holding) a participation in a Loan may exercise any and all rights of banker's
lien, set off or counterclaim with respect to any and all moneys owing by the
Borrower to such Lender or Lenders as fully as if such Lender or Lenders held
such and was the original obligee on such Loan or on any note evidencing such
Loan (if applicable), in the amount of such participation.
(b) The Administrative Agent is hereby authorized at any time
and from time to time, to the fullest extent permitted by Applicable Law, to set
off and apply any and all amounts received by the Administrative Agent for the
account of a Defaulting Lender to the satisfaction of the unpaid obligations
owing by such Defaulting Lender to the Administrative Agent or the Issuing Bank
and the rights of such Defaulting Lender with respect to all such amounts shall
be subject and subordinate to the rights of the Administrative Agent and the
Issuing Bank, as the case may be, to be paid the amounts owing to it by such
Defaulting Lender.
SECTION 12.4 Notice to the Lenders. Upon receipt by the
Administrative Agent or the Issuing Bank from any of the Credit Parties of any
communication calling for an action on the part of the Lenders or the Revolving
Credit Lenders, as the case may be, or upon written notice to the Administrative
Agent of any Event of Default, the Administrative Agent or the Issuing Bank will
in turn promptly inform the other Lenders or the Revolving Credit Lenders, as
the case may be, in writing (which shall include facsimile communications) of
the nature of such communication or of the Event of Default, as the case may be.
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SECTION 12.5 Liability of the Administrative Agent, the
Co-Lead Arrangers and the Issuing Bank. (a) The Administrative Agent, the
Co-Lead Arrangers and the Issuing Bank, when acting on behalf of the Lenders (or
in the case of the Administrative Agent, when acting on behalf of the Secured
Parties), may execute any of its duties under this Credit Agreement or the other
Fundamental Documents by or through its officers, agents, or employees and
neither the Administrative Agent, the Co-Lead Arrangers, the Issuing Bank nor
their respective officers, agents or employees shall be liable to the Lenders or
any of them for any action taken or omitted to be taken in good faith, nor be
responsible to the Lenders or to any of them for the consequences of any
oversight or error of judgment, or for any loss, unless the same shall happen
through its gross negligence or willful misconduct. The Administrative Agent,
the Co-Lead Arrangers, the Issuing Bank and their respective directors,
officers, agents, and employees shall in no event be liable to the Lenders or to
any of them, nor shall any Lender have any cause of action against any of them
for any action taken or omitted to be taken by it pursuant to instructions
received by it from the Required Lenders or the Required Revolving Credit
Lenders, as the case may be, or in reliance upon the advice of counsel selected
by it with reasonable care or counsel to the Borrower. Without limiting the
foregoing, neither the Administrative Agent, the Co-Lead Arrangers, the Issuing
Bank nor any of their respective directors, officers, employees, or agents shall
be responsible to any of the Lenders for the due execution, validity,
genuineness, effectiveness, sufficiency, or enforceability of, or for any
statement, warranty, or representation in, or for the perfection of any security
interest contemplated by, this Credit Agreement, any other Fundamental Document
or any related agreement, document or order, or for freedom of any of the
Collateral or any of the Real Property Assets or any of the Pledged Securities
from prior Liens or security interests, or shall be required to ascertain or to
make any inquiry concerning the performance or observance by the Borrower or any
other Credit Party of any of the terms, conditions, covenants, or agreements of
this Credit Agreement, any other Fundamental Document, or any related agreement
or document.
(b) None of the Administrative Agent (in its capacity as agent
for the Lenders and for the Secured Parties), the Co-Lead Arrangers, the Issuing
Bank or any of their respective directors, officers, employees, or agents shall
have any responsibility to the Borrower or any other Credit Party on account of
the failure or delay in performance or breach by any of the Lenders of any of
such Lender's obligations under this Credit Agreement, the other Fundamental
Documents or any related agreement or document or in connection herewith or
therewith. No Lender nor any of its directors, officers, employees or agents
shall have any responsibility to the Borrower or any other Credit Party on
account of the failure or delay in performance or breach by any other Lender of
such other Lender's obligations under this Credit Agreement, the other
Fundamental Documents or any related agreement or document or in connection
herewith or therewith.
(c) The Administrative Agent (as agent for the Lenders and the
Secured Parties) the Co-Lead Arrangers and the Issuing Bank shall be entitled to
rely on any communication, instrument, or document believed by it to be genuine
or correct and to have been signed or sent by a Person or Persons believed by it
to be the proper Person or Persons, and it shall be entitled to rely on advice
of legal counsel (who may be counsel for the Borrower), independent public
accountants, and other professional advisers and experts selected by it.
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(d) Each of the Administrative Agent, the Co-Lead Arrangers
and the Issuing Bank shall be entitled to refrain from any act or the taking of
any action (including the failure to take an action) in connection herewith or
any of the other Fundamental Documents or from the exercise of any power,
discretion or authority vested in it hereunder or thereunder unless and until it
shall have received instructions in respect thereof from the Required Lenders or
Required Revolving Credit Lenders, as the case may be, and, upon receipt of such
instructions from the Required Lenders or Required Revolving Credit Lenders, as
the case may be, it shall be entitled to act or (where so instructed) refrain
from acting, or to exercise such power, discretion or authority, in accordance
with such instructions.
SECTION 12.6 Reimbursement and Indemnification. Each of the
Lenders agrees (i) to reimburse the Administrative Agent, the Co-Lead Arrangers
and/or the Issuing Bank for such Lender's pro rata share of any expenses and
fees incurred for the benefit of the Lenders under the Fundamental Documents,
including, without limitation, counsel fees and compensation of agents,
employees, financial advisors and other professionals paid for services rendered
on behalf of the Agents, the Issuing Bank or the Lenders, and any other expense
incurred in connection with the operations or enforcement thereof not reimbursed
by or on behalf of the Borrower and (ii) to indemnify and hold harmless the
Administrative Agent, the Co-Lead Arrangers and/or the Issuing Bank and any of
their respective directors, officers, employees, or agents, on demand, in
accordance with such Lender's Percentage, from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements (including reasonable attorneys' fees and
disbursements) of any kind or nature whatsoever which may be imposed on,
incurred by, or asserted against, it or any of them in any way relating to or
arising out of any of the Fundamental Documents or any related agreement or
document, or any action taken or omitted to be taken by it or any of them under
any of the Fundamental Documents or any related agreement or document, to the
extent not reimbursed by or on behalf of the Borrower or any other Credit Party
(except such as shall result from the gross negligence or willful misconduct of
the Person to be reimbursed, indemnified or held harmless, as applicable) and
(iii) to indemnify and hold harmless the Issuing Bank and any of its directors,
officers, employees, or agents, on demand, in the amount of its Revolving Credit
Percentage share, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may be imposed on, incurred by, or
asserted against it or any of them in any way relating to or arising out of the
issuance of any Letters of Credit or the failure to issue Letters of Credit
(except as shall result from the gross negligence or willful misconduct of the
Person to be reimbursed, indemnified or held harmless, as applicable). If any
indemnity furnished to any Agent, any Co-Lead Arranger or the Issuing Bank for
any purpose shall, in the opinion of such Agent, Co-Lead Arranger or the Issuing
Bank, as the case may be, be insufficient or become impaired, such Agent,
Co-Lead Arranger or the Issuing Bank, as the case may be, may call for
additional indemnity and cease, or not commence, to do the acts indemnified
against until such additional indemnity is furnished; provided, that in no event
shall this sentence require any Lender to indemnify any Agent, any Co-Lead
Arranger or the Issuing Bank against any liability, obligation, loss, damage,
penalty, action, judgment, suit, cost, expense or disbursement in excess of such
Lender's pro rata share thereof. To the extent indemnification payments made by
the Lenders pursuant to this Section 12.6 are subsequently recovered by the
Administrative Agent, the Co-Lead Arrangers or the Issuing Bank from a Credit
Party, the Administrative Agent, the Co-Lead Arrangers or the Issuing Bank, as
applicable, will promptly refund such previously paid indemnity payments to the
Lenders.
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SECTION 12.7 Rights of the Agents. It is understood and agreed
that each of the Agents shall have the same duties, rights and powers as a
Lender hereunder (including the right to give such instructions) as any of the
other Lenders and may exercise such rights and powers, as well as its rights and
powers under other agreements and instruments to which it is or may be party,
and engage in other transactions with any Credit Party or Affiliate thereof, as
though it were not an Agent under this Credit Agreement and the other
Fundamental Documents.
SECTION 12.8 Independent Investigation by Lenders. Each of the
Lenders acknowledges that it has decided to enter into this Credit Agreement and
the other Fundamental Documents, to make the Loans and to participate in the
Letters of Credit hereunder based on its own analysis of the transactions
contemplated hereby and of the creditworthiness of the Credit Parties and agrees
that neither the Administrative Agent nor the Issuing Bank shall bear any
responsibility therefor.
SECTION 12.9 Agreement of the Lenders. Upon any occasion
requiring or permitting an approval, consent, waiver, election or other action
on the part of the Required Lenders, action shall be taken by the Administrative
Agent for and on behalf of, or for the benefit of, all Lenders upon the
direction of the Required Lenders and any such action shall be binding on all
Lenders. No amendment, modification, consent or waiver shall be effective except
in accordance with the provisions of Section 13.11 hereof.
SECTION 12.10 Notice of Transfer. The Administrative Agent and
the Issuing Bank may deem and treat any Lender which is a party to this Credit
Agreement as the owner of such Lender's respective portions of the Loans and
participations in Letters of Credit for all purposes, unless and until a written
notice of the assignment or transfer thereof executed by any such Lender shall
have been received by the Administrative Agent and shall have become effective
in accordance with Section 13.3 hereof.
SECTION 12.11 Relations Among Lenders. Each Lender in its
capacity as a Lender hereunder agrees that it will not take any legal action,
nor institute any actions or proceedings, against the Borrower or any other
Credit Party with respect to any Collateral or any Real Property Asset, it being
understood and agreed that all such actions are to be taken by the
Administrative Agent on behalf of the Lenders. Without limiting the generality
of the foregoing, no Lender may unilaterally terminate its Commitment or
accelerate, or otherwise enforce or seek to enforce any rights or remedies with
respect to, any Loans or other Obligations owed to it, except statutory or
common law rights of banker's liens and setoff with respect to accounts
maintained with such Lender.
SECTION 12.12 Successor Agents. The Administrative Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrower, but such resignation shall not become effective until acceptance by a
successor agent of its appointment pursuant hereto. Upon any such resignation,
the retiring Administrative Agent shall promptly appoint a successor agent from
among the Lenders; provided, that such replacement is reasonably acceptable (as
evidenced in writing) to the Required Lenders, the Issuing Bank and the
Borrower; provided, however, that such approval by the Borrower shall not be
required at any time when a Default or Event of Default has occurred and is
continuing. If no successor agent shall have been so appointed by the retiring
Administrative Agent and shall have accepted such appointment, within 30 days
after the retiring agent's giving of notice of resignation, the Borrower may
appoint a successor as agent (provided, that such successor is reasonably
acceptable to the Required Lenders and the Issuing Bank), which shall be either
a Lender or a commercial bank organized under the laws of the United States of
America or of any State thereof and shall have a combined capital and surplus of
at least $250,000,000. Upon the acceptance of any appointment as Administrative
Agent hereunder by a successor agent, such successor agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Administrative Agent and the retiring Administrative Agent shall
be discharged from its duties and obligations under this Credit Agreement, the
other Fundamental Documents and any other credit documentation. After any
retiring Administrative Agent's resignation hereunder as Administrative Agent
the provisions of this Article 12 shall inure to its benefit as to any actions
taken or omitted to be taken by it while it was Administrative Agent under this
Credit Agreement and the other Fundamental Documents.
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SECTION 12.13 Tenant's Quiet Enjoyment. Upon the written
request of the Borrower, the Administrative Agent shall deliver a subordination,
non-disturbance and attornment agreement, in favor of the lessee under any lease
of Real Property Assets, in form and substance reasonably satisfactory to the
Administrative Agent and the Borrower, pursuant to which agreement the
Administrative Agent shall agree (to the extent required by the applicable lease
or sublease) (a) to give the tenant or subtenant thereunder the same notice, if
any, given to the Borrower of any default or acceleration of any obligation
underlying the applicable Mortgage or any sale in foreclosure under such
Mortgage, (b) to permit the tenant or subtenant thereunder to cure any such
default on the Borrower's behalf within any applicable cure period, (c) to
permit the tenant or subtenant thereunder to appear by its representative and to
bid at any sale in foreclosure made with respect to the applicable Mortgage and
(d) subject to the terms to be included in the applicable subordination,
non-disturbance and attornment agreement, not to disturb the aforesaid tenant's
or subtenant's possession so long as it is not in default in performing its
obligations under such lease or sublease.
SECTION 12.14 Lender Payments. (a) Except as otherwise
provided herein, all payments by any Lender hereunder shall be made to the
Administrative Agent at the office of Wachovia Bank, National Association, ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Syndication Agency
Services (wiring information: ABA-▇▇▇▇▇▇▇▇▇, Acct. No.: ▇▇▇▇▇▇▇▇▇▇▇▇▇, Account
Name: Genesis HealthCare Corporation, Ref: Genesis HealthCare Corporation) not
later than 1:00 p.m. (Eastern time). All payments received after such time shall
be deemed received on the next succeeding Business Day. All payments shall be
made in immediately available funds in lawful money of the United States of
America.
(b) If any Agent, the Issuing Bank, any Lender or any other
Secured Party is required at any time to return to the Borrower, or to a
trustee, receiver, liquidator, custodian, or any official under any proceeding
under any Debtor Relief Law, any portion of a payment made by the Borrower, each
such Secured Party shall, on demand of the Administrative Agent, return its
share of the amount to be returned which is received by the applicable Secured
Party, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate.
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13. MISCELLANEOUS
SECTION 13.1 Notices. (a) Notices and other communications
provided for herein shall be in writing and shall be delivered and addressed:
(i) if to the Administrative Agent:
Wachovia Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Syndication Agency Services
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
Wachovia Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ Santa ▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇.▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
(ii) if to a Credit Party:
Genesis HealthCare Corporation
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
(iii) if to the Lender, to it at its address set forth on
its signature page hereto.
or such other address as such party may from time to time designate by giving
written notice to the other parties hereunder.
Any failure of any Person giving notice pursuant to this Section 13.1, to
provide a courtesy copy to a party as provided herein, shall not affect the
validity of such notice. All notices and other communications given to any party
hereto in accordance with the provisions of this Credit Agreement shall be
deemed to have been given (x) on the fifth Business Day after the date when sent
by registered or certified mail, postage prepaid, return receipt requested, if
by mail, (y) when delivered, if delivered by hand or overnight courier service
or (z) when receipt is acknowledged, if by facsimile communications equipment or
e-mail in each case addressed to such party as provided in this Section 13.1 or
in accordance with the latest unrevoked written direction from such party.
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(b) No notice to or demand on any of the Credit Parties shall
entitle such Credit Party to any other or further notice or demand in the same,
similar or other circumstances.
SECTION 13.2 Survival of Agreement, Representations and
Warranties, etc. All warranties, representations and covenants made by any of
the Credit Parties herein, in any other Fundamental Document or in any
certificate or other instrument delivered by it under this Credit Agreement or
any other Fundamental Document shall be considered to have been relied upon by
the Administrative Agent, the Issuing Bank and the Lenders and, except for any
terminations, amendments, modifications or waivers thereof in accordance with
the terms hereof, shall survive the execution and delivery of this Credit
Agreement, the making of the Loans and the issuance of the Letters of Credit
herein contemplated and the execution and delivery of any notes evidencing any
Loan hereunder regardless of any investigation made by the Administrative Agent,
the Issuing Bank or the Lenders or on their behalf, and shall continue in full
force and effect so long as any Obligation is outstanding and unpaid and so long
as the Commitments have not been terminated. All statements in any such
certificate or other instrument shall constitute representations and warranties
by the Credit Parties hereunder.
SECTION 13.3 Successors and Assigns; Syndications; Loan Sales;
Participations. (a) Whenever in this Credit Agreement any of the parties hereto
is referred to, such reference shall be deemed to include the successors and
assigns of such party; provided, however, that neither the Borrower nor any
other Credit Party may assign its rights hereunder without the prior written
consent of the Administrative Agent, the Issuing Bank and all of the Lenders.
All covenants, promises and agreements by or on behalf of any of the Credit
Parties which are contained in this Credit Agreement shall inure to the benefit
of the successors and assigns of the Administrative Agent, the Issuing Bank and
the Lenders; provided, however, that the Lenders may only assign their
interests, rights and obligations under this Credit Agreement in accordance with
this Section 13.3.
(b) Each of the Lenders may (but only with the prior written
consent of the Administrative Agent and the Borrower and in the case of an
assignment of a Revolving Credit Commitment and/or Revolving Loans, the Issuing
Bank, which consent in each case shall not be unreasonably withheld or delayed
and which consent by the Borrower shall not be required if at the time the
applicable Assignment and Acceptance is delivered to the Administrative Agent
for its acceptance and recording, an Event of Default has occurred and is then
continuing) assign to one or more Lenders or an Eligible Assignee all or a
portion of its interests, rights and obligations under this Credit Agreement
(including, without limitation, all or a portion of any Loans at the time owing
to it, any note held by it evidencing such Loans, or all or a portion of its
Commitment(s) and the same portion of all Loans at the time owing to it and any
notes held by it evidencing its Loans and its obligations with regard to Letters
of Credit); provided, however, that (i) each assignment shall (x) in the case of
a Revolving Credit Loan or Revolving Credit Commitment, be in a minimum amount
of $2,500,000 (or such lesser amount as shall equal any Lender's entire
Revolving Credit Loans or Revolving Credit Commitment)), or (y) in the case of a
B Term Loan, be in a minimum amount of $1,000,000 (or such lesser amount as
shall equal any Lender's entire B Term Loan, (ii) the parties to each such
assignment shall execute and deliver to the Administrative Agent, for its
acceptance and recording in the Register (as defined below), an Assignment and
Acceptance substantially in the form of Exhibit A hereto, together with the
assigning Lender's original note (if any) evidencing the Loans being assigned
and a processing and recordation fee of $3,500 (which fee shall also be payable
in the case of assignments from an assigning Lender to another Lender hereunder)
to be paid to the Administrative Agent by the assigning Lender or the assignee
and (iii) the assignee shall deliver to the Borrower and the Administrative
Agent certification as to the exemption from deduction or withholding of any
United States federal income taxes in accordance with Section 2.18. Upon such
execution, delivery, acceptance and recording, from and after the effective date
specified in each Assignment and Acceptance, which effective date shall not
(unless otherwise agreed to by the Administrative Agent) be earlier than five
(5) Business Days after the date of acceptance and recording by the
Administrative Agent, (x) the assignee thereunder shall be a party hereto and,
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to the extent provided in such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and under the other Fundamental Documents and
shall be bound by the provisions hereof and (y) the assigning Lender thereunder
shall, to the extent provided in such Assignment and Acceptance, relinquish its
rights and be released from its obligations under this Credit Agreement except
that, notwithstanding such assignment, any rights and remedies available to the
Borrower for any breaches by such assigning Lender of its obligations hereunder
while a Lender shall be preserved after such assignment and such Lender shall
not be relieved of any liability to the Borrower due to any such breach. In the
case of an Assignment and Acceptance covering all or the remaining portion of
the assigning Lender's rights and obligations under this Credit Agreement, such
assigning Lender shall cease to be a party hereto. It shall not be necessary for
any Lender to sell the same percentage of its Revolving Credit Commitment and
Revolving Credit Loans and its B Term Loans (although each such percentage of
its Revolving Credit Commitment and Revolving Credit Loans and its B Term Loans
must be a constant, not varying percentage) (provided, that any such assignment
shall be subject to the provisions of this Section 13.3 in all respects).
(c) Each Lender, in accordance with Section 13.3(b) hereof
(other than with respect to the minimum amount of an assignment and necessity of
obtaining consents which shall be governed by the provisions set forth below of
this Section 13.3(c)), may at any time make an assignment of its interests,
rights and obligations under this Credit Agreement to any Affiliate of such
Lender or to a Related Fund without the consent of the Administrative Agent, the
Issuing Bank or the Borrower or any other Credit Party. Any assignment to any
Affiliate of the assigning Lender or to a Related Fund hereunder shall not be
subject to the requirement of Section 13.3(b) as to a minimum amount and any
such assignment to any Affiliate of the assigning Lender or to a Related Fund
shall not release the assigning Lender from its remaining obligations hereunder,
if any.
(d) By executing and delivering an Assignment and Acceptance,
the assigning Lender thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby and that such interest is free and clear of any
adverse claim, the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or any other
Fundamental Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of the Credit Agreement, any of the other
Fundamental Documents or any other instrument or document furnished pursuant
hereto or thereto; (ii) such assignor Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition of any of
the Credit Parties or the performance or observance by any of the Credit Parties
of any of their respective obligations under the Fundamental Documents or any
other instrument or document furnished pursuant thereto; (iii) such assignee
confirms that it has received a copy of this Credit Agreement, together with
copies of the most recent financial statements delivered pursuant to Sections
5.1(a)(i) and (ii) (or if none of such financial statements shall have then been
delivered, then copies of the financial statements referred to in Section 3.6
hereof) and such other documents and information as it has deemed appropriate to
make its own credit analysis and decision to enter into such Assignment and
Acceptance; (iv) such assignee agrees that it will, independently and without
reliance upon the assigning Lender, the Administrative Agent, the Issuing Bank,
any other Lender or any other Secured Party and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Credit Agreement or
any of the other Fundamental Documents or any other instrument or document
furnished pursuant thereto; (v) such assignee appoints and authorizes the
Administrative Agent and the Issuing Bank to take such action as agent(s) on its
behalf and to exercise such powers under this Credit Agreement as are delegated
to the Administrative Agent or the Issuing Bank (as applicable) by the terms
hereof, together with such powers as are reasonably incidental thereto; and (vi)
such assignee agrees that it will be bound by the provisions of this Credit
Agreement and the other Fundamental Documents and will perform in accordance
with their terms all of the obligations which by the terms of this Credit
Agreement and the other Fundamental Documents are required to be performed by it
as a Lender.
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(e) The Administrative Agent shall maintain at its address at
which notices are to be given to it pursuant to Section 13.1 hereof a copy of
each Assignment and Acceptance and a register for the recordation of the names
and addresses of the Lenders and the Commitments of, and principal amount of the
Loans owing to, each Lender from time to time (the "Register"). The entries in
the Register shall be conclusive, in the absence of manifest error, and the
Credit Parties, the Administrative Agent, the Issuing Bank and the Lenders may
treat each Person whose name is recorded in the Register as a Lender hereunder
for all purposes of the Fundamental Documents. The Register shall be available
for inspection by any Credit Party or any Lender at any reasonable time and from
time to time upon reasonable prior notice.
(f) Subject to the foregoing, upon its receipt of an
Assignment and Acceptance executed by an assigning Lender and an assignee
together with the assigning Lender's original note (if any) evidencing the Loans
being assigned thereby, the processing and recordation fee, and evidence of the
Administrative Agent's and the Borrower's written consent to such assignment (if
required), the Administrative Agent shall, if such Assignment and Acceptance has
been completed and is substantially in the form of Exhibit A hereto, (i) accept
such Assignment and Acceptance, (ii) record the information contained therein in
the Register and (iii) give prompt written notice thereof to the Borrower.
Within five (5) Business Days after receipt of the notice, the Borrower, at its
own expense, shall execute and deliver to the Administrative Agent, in exchange
for any surrendered note, a new note to the order of such assignee in an amount
equal to the Revolving Credit Commitment or the principal amount of the B Term
Loan (as appropriate) assumed by the assignee Lender pursuant to such Assignment
and Acceptance and if the assigning Lender has retained a Revolving Credit
Commitment or any portion of a B Term Loan, a new note to the order of the
assigning Lender in an amount equal to the Revolving Credit Commitment or the
principal amount of the B Term Loan (as appropriate) retained by it hereunder.
Such new notes shall be in an aggregate principal amount equal to the aggregate
principal amount of the surrendered note (or if applicable, the outstanding
principal amount of the applicable Loan owed to the assigning Lender immediately
preceding the relevant assignment), shall be dated the date of the surrendered
note and shall otherwise be in substantially the form of the surrendered note.
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(g) Each of the Lenders may, without the consent of any of the
Credit Parties or any of the Agents, the Issuing Bank or the other Lenders, sell
participations to one or more banks, mutual funds or other financial
institutions in all or a portion of its rights and obligations under this Credit
Agreement (including, without limitation, all or a portion of any B Term Loans
at the time owing to it and any note held by it evidencing such Loans, or all or
a portion of its Revolving Credit Commitment and the same portion of all
Revolving Credit Loans (if any) at the time owing to it and any notes held by it
evidencing its Revolving Credit Loans and its participation in Letters of
Credit); provided, however, that (i) any such Lender's obligations under this
Credit Agreement shall remain unchanged, (ii) such participant shall not be
granted any voting rights or any right to control the vote of such Lender under
this Credit Agreement, except that such participant may be granted voting rights
(or a right to control the vote of such Lender under this Credit Agreement) with
respect to (A) proposed decreases to interest rates or fees payable to the
applicable Lender, (B) subject to Section 13.11 hereof changes to the amount of
the Revolving Credit Commitments of the applicable Lender (except for a ratable
decrease in the Total Revolving Credit Commitment of all Lenders holding
Revolving Credit Commitments), (C) final maturity of any Loan and fees (in each
case, as applicable to such participant) and (D) releases of all or
substantially all the Collateral and the Real Property Assets, (iii) any such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iv) the participating banks or other entities
shall be entitled to the cost protection provisions contained in Sections 2.15,
2.16, 2.17, 2.18 and 2.21 hereof, but a participant shall not be entitled to
receive pursuant to such provisions an amount larger than its share of the
amount to which the Lender granting such participation would have been entitled
to receive and (v) the Credit Parties, the Administrative Agent, the Issuing
Bank and the other Lenders shall continue to deal solely and directly with such
Lender in connection with such Lender's and its participants' rights and
obligations under this Credit Agreement.
(h) A Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
13.3, disclose to the assignee or participant or proposed assignee or
participant, any information relating to any of the Credit Parties furnished to
the Administrative Agent, the Issuing Bank or such Lender by or on behalf of the
Borrower or any other Credit Party; provided, that prior to any such disclosure,
each such assignee or participant or proposed assignee or participant shall
agree in writing to be bound by the provisions of Section 13.17 hereof.
(i) The Credit Parties consent that any Lender may at any time
and from time to time pledge or otherwise grant a security interest in any Loan
or in any Note evidencing the Loans (or any part thereof) to any Federal Reserve
Bank.
(j) Any assignment pursuant to paragraph (b) or (c) of this
Section 13.3 shall constitute an amendment of the Commitments appearing on the
signature pages hereto as of the effective date of such assignment.
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(k) Notwithstanding anything contained in this Section any
Lender may at any time assign or pledge all or any portion of its rights under
this Agreement without the prior written consent of the Borrower, the Agents or
the Issuing Bank to secure extensions of credit to such Lender or in support of
obligations owed by such Lender; provided that (i) no such assignment or pledge
shall release a Lender from any of its obligations hereunder or substitute any
such assignee for such Lender as a party hereto and (ii) the right of any such
assignee or pledgee to exercise any of such Lender's rights hereunder or to
further transfer all or any portion of the rights pledged or granted to it,
whether by means of foreclosure or otherwise shall at all times be subject to
the other terms and provisions of this Section 13.3. In order to facilitate such
an assignment, the Borrower shall, at the request of the assigning Lender, duly
execute and deliver to the assigning Lender a Note or Notes evidencing the Loans
made to the Borrower by the assigning Lender hereunder.
SECTION 13.4 Expenses; Documentary Taxes. Whether or not the
transactions hereby contemplated shall be consummated, the Borrower agrees to
pay (a) all reasonable out-of-pocket expenses incurred by the Administrative
Agent and the Issuing Bank in connection with, or arising out of, the
performance of due diligence, the negotiation, preparation, execution, delivery,
waiver or modification and administration of this Credit Agreement and any other
documentation contemplated hereby, the making of the Loans and the issuance of
the Letters of Credit, the Collateral, the Pledged Securities, any Real Property
Asset or any Fundamental Document, including but not limited to, the reasonable
out-of-pocket costs and internally allocated charges of one legal counsel or
audit or field examinations of the Administrative Agent and the Issuing Bank in
connection with the administration of this Credit Agreement, the verification of
financial data or the transactions contemplated hereby, and the reasonable fees
and disbursements of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel for the Agents, and
any other counsel that the Agents shall retain and (b) all reasonable
out-of-pocket expenses incurred by the Agents, the Issuing Bank, any Lender and
any other Secured Party in the enforcement or protection (as distinguished from
administration) of the rights and remedies of the Agents, the Issuing Bank, the
Lenders and any other Secured Parties in connection with this Credit Agreement,
the other Fundamental Documents, the Letters of Credit or any notes evidencing
the Loans hereunder, or as a result of any transaction, action or non-action
arising from any of the foregoing, including but not limited to, the reasonable
fees and disbursements of any counsel for any of the Agents, the Issuing Bank,
the Lenders or any other Secured Party. Such payments shall be made on the date
this Credit Agreement is executed by the Borrower and thereafter on demand. The
Borrower agrees that it shall indemnify the Agents, the Issuing Bank, the
Lenders and any other Secured Parties from and hold them harmless against any
documentary taxes, assessments or charges made by any Governmental Authority by
reason of the execution and delivery of this Credit Agreement or any notes
evidencing any of the Loans hereunder or the issuance of Letters of Credit. The
obligations of the Borrower under this Section 13.4 shall survive the Facility
Termination Date, the termination of this Credit Agreement and the payment of
the Loans and/or the expiration of the Letters of Credit.
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SECTION 13.5 Indemnity. The Borrower agrees to indemnify and
hold harmless the Agents, the Issuing Bank, the Co-Lead Arrangers, the Lenders
and any other Secured Parties, their respective directors, officers, employees,
trustees, Affiliates, investments advisors and agents, and any professionals
retained by them (each an "Indemnified Party") (to the full extent permitted by
Applicable Law) from and against any and all claims, demands, losses, judgments,
damages and liabilities (including liabilities for penalties) incurred by any of
them as a result of, or arising out of, or in any way related to, or by reason
of, any investigation, litigation or other proceeding (whether or not any
Indemnified Party is a party thereto) related to the entering into and/or
performance of this Credit Agreement or any other Fundamental Document or the
use of the proceeds of any Loans hereunder or the issuance of any Letter of
Credit or the consummation of any other transaction contemplated in this Credit
Agreement or any other Fundamental Document, including, without limitation, the
reasonable fees and disbursements of counsel incurred in connection with any
such investigation, litigation or other proceeding (but excluding any such
losses, liabilities, claims, damages or expenses of an Indemnified Party to the
extent incurred by reason of the gross negligence or willful misconduct of such
Indemnified Party as determined by a final order or judgment of a court of
competent jurisdiction). The foregoing indemnity agreement includes any
reasonable costs incurred by an Indemnified Party in connection with any action
or proceeding which may be instituted in respect of the foregoing by one of the
Agents, the Co-Lead Arrangers or the Issuing Bank or by any other Person either
against one of the Agents, the Co-Lead Arrangers, the Issuing Bank or the
Lenders or in connection with which any officer or employee of one of the
Agents, the Co-Lead Arrangers, the Issuing Bank or the Lenders is called as a
witness or deponent, including, but not limited to, the reasonable fees and
disbursements of ▇▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP, counsel to the Agents and the
Co-Lead Arrangers and any out-of-pocket costs incurred by the Agents, the
Co-Lead Arrangers, the Issuing Bank, the Lenders or any other Secured Party in
appearing as a witness or in otherwise complying with legal process served upon
them. The obligations of the Borrower under this Section 13.5 shall survive the
Facility Termination Date, the termination of this Credit Agreement and the
payment of the Loans and/or the expiration or termination of the Letters of
Credit and shall inure to the benefit of any Person who was a Lender
notwithstanding such Person's assignment of all its Loans and its Revolving
Credit Commitment hereunder.
If a Credit Party shall fail to do any act or thing which it
has covenanted to do hereunder or under a Fundamental Document, or any
representation or warranty of a Credit Party shall be breached, the
Administrative Agent may (but shall not be obligated to) do the same or cause it
to be done or remedy any such breach, and there shall be added to the
Obligations hereunder the cost or expense incurred by the Administrative Agent
in so doing, and any and all amounts expended by the Administrative Agent in
taking any such action shall be repayable to it upon its demand therefor and
shall bear interest at a rate per annum of 2% in excess of the rate then in
effect for Base Rate Loans which are Revolving Credit Loans set forth in Section
2.13(a) from time to time in effect from the date advanced to the date of
repayment.
SECTION 13.6 CHOICE OF LAW. THIS CREDIT AGREEMENT, THE OTHER
FUNDAMENTAL DOCUMENTS AND ANY NOTE EVIDENCING ANY OF THE LOANS HEREUNDER SHALL
IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH, AND GOVERNED BY, THE LAWS OF
THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES AND BY
FEDERAL LAW TO THE EXTENT APPLICABLE; PROVIDED, HOWEVER, THAT WITH RESPECT TO
ANY MORTGAGE FILED IN A JURISDICTION OUTSIDE THE STATE OF NEW YORK, THE LAWS OF
SUCH JURISDICTION WHERE SUCH MORTGAGE WAS FILED SHALL APPLY.
121
SECTION 13.7 WAIVER OF JURY TRIAL. TO THE EXTENT NOT
PROHIBITED BY APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY
WAIVES, AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT
OR OTHERWISE), ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE,
CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION ARISING OUT OF OR BASED UPON THIS
CREDIT AGREEMENT, THE SUBJECT MATTER HEREOF, ANY OTHER FUNDAMENTAL DOCUMENT OR
THE SUBJECT MATTER THEREOF, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING AND WHETHER IN CONTRACT OR TORT OR OTHERWISE. EACH PARTY HERETO
ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTIES HERETO THAT THE
PROVISIONS OF THIS SECTION 13.7 CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH SUCH
OTHER PARTIES HAVE RELIED, ARE RELYING AND WILL RELY IN ENTERING INTO THIS
CREDIT AGREEMENT AND ANY OTHER FUNDAMENTAL DOCUMENT. ANY PARTY MAY FILE AN
ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 13.7 WITH ANY COURT AS WRITTEN
EVIDENCE OF THE CONSENT OF ANY OTHER PARTY TO THE WAIVER OF ITS RIGHTS TO TRIAL
BY JURY.
SECTION 13.8 WAIVER WITH RESPECT TO DAMAGES. EACH CREDIT PARTY
ACKNOWLEDGES THAT NEITHER THE ADMINISTRATIVE AGENT, THE CO-LEAD ARRANGERS, THE
ISSUING BANK, ANY LENDER NOR ANY OTHER SECURED PARTY HAS ANY FIDUCIARY
RELATIONSHIP WITH, OR FIDUCIARY DUTY TO, ANY CREDIT PARTY ARISING OUT OF OR IN
CONNECTION WITH THIS CREDIT AGREEMENT OR ANY OTHER FUNDAMENTAL DOCUMENT AND THE
RELATIONSHIP BETWEEN THE ADMINISTRATIVE AGENT, THE CO-LEAD ARRANGERS, THE
ISSUING BANK, THE LENDERS AND ANY OTHER SECURED PARTIES, ON THE ONE HAND, AND
THE CREDIT PARTIES, ON THE OTHER HAND, IN CONNECTION THEREWITH IS SOLELY THAT OF
DEBTOR AND CREDITOR. TO THE EXTENT PERMITTED BY APPLICABLE LAW, NO CREDIT PARTY
SHALL ASSERT, AND EACH CREDIT PARTY HEREBY WAIVES, ANY CLAIMS AGAINST THE
ADMINISTRATIVE AGENT, THE CO-LEAD ARRANGERS, THE ISSUING BANK, THE LENDERS AND
ANY OTHER SECURED PARTY ON ANY THEORY OF LIABILITY, FOR SPECIAL, INDIRECT,
CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL DAMAGES)
ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF, THIS CREDIT AGREEMENT,
ANY FUNDAMENTAL DOCUMENT, ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY OR
THEREBY, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
SECTION 13.9 No Waiver. No failure on the part of the
Administrative Agent, the Issuing Bank, any Lender or any other Secured Party to
exercise, and no delay in exercising, any right, power or remedy hereunder,
under any note evidencing any Loan hereunder, with regard to any Letter of
Credit, or any other Fundamental Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right, power or remedy preclude
any other or further exercise thereof or the exercise of any other right, power
or remedy. All remedies hereunder are cumulative and are not exclusive of any
other remedies provided by law.
122
SECTION 13.10 Extension of Payment Date. Except as otherwise
specifically provided in Article 2 hereof, should any payment or prepayment of
principal of or interest on any of the Loans or any other amount due hereunder,
become due and payable on a day other than a Business Day, the due date of such
payment or prepayment shall be extended to the next succeeding Business Day and,
in the case of a payment or prepayment of principal, interest shall be payable
thereon at the rate herein specified during such extension.
SECTION 13.11 Amendments, etc. (a) Unless otherwise
specifically provided herein any provision of this Credit Agreement may be
amended or waived if, but only if, such amendment or waiver is in writing and is
signed by the Credit Parties and the Required Lenders (and, if the rights or
duties of any of the Agents are affected thereby, by the applicable Agent);
provided, that if such amendment or waiver affects only the Lenders holding B
Term Loans, Swingline Loans or Revolving Credit Loans (or Revolving Credit
Commitments), as applicable, then only Lenders holding more than 50% of the
Loans in the applicable Tranche (or the Revolving Credit Commitments, if
applicable) shall be required to sign such amendment or waiver; provided,
further, that no such amendment or waiver shall (i) increase, decrease, or
extend the Commitment of any Lender (except for a ratable decrease in the
Commitment of all Lenders holding Commitments for that Tranche), without the
prior written consent of such Lender, (ii) reduce the principal of, or rate of
interest on, any Loan or any Fees specified herein, due to a Lender without the
prior written consent of such Lender, (iii) postpone the date fixed for any
payment of principal of, or interest on, any Loan or any Fees hereunder due to a
Lender or for any reduction or termination of the Commitment of a Lender,
without the prior written consent of each such Lender, (iv) increase the amount
of the B Term Loans, Swingline Loans or the Revolving Credit Loans of a Lender,
without the prior written consent of such Lender, (v) decrease any amount
payable to a Lender pursuant to the provisions of Section 2.12 or Section 12.2
hereof, without the prior written consent of each such Lender, (vi) release all
or substantially all of the Collateral and the Real Property Assets from the
Liens created by the Fundamental Documents or release the Guarantors from the
guaranties hereunder accounting for all or substantially all of the value of the
Borrower and Guarantors taken as a whole (except, in each case, as expressly
permitted hereby), without the prior written consent of all the Lenders, or
release Collateral in any transaction or series of related transactions having
an aggregate net book value in excess of 50% of the net book value of all Credit
Parties, as determined on the Closing Date, (except as expressly permitted
hereby) without the consent of Lenders having Credit Exposure greater than
Eighty Five percent (85%) of the Total Credit Exposure; provided, that for
purposes of this clause (vi), the Credit Exposure of a Lender shall be
disregarded if and for so long as such Lender shall be a Defaulting Lender,
(vii) amend or modify the provisions of this Section 13.11, without the prior
written consent of all the Lenders, (viii) amend the definition of "Required
Lenders," without the prior written consent of all the Lenders or "Required
Revolving Credit Lenders" without the consent of all the Revolving Credit
Lenders or (ix) amend or modify any provision of this Agreement which expressly
provides for the unanimous consent or approval of the Lenders. No such
amendment, modification, waiver or consent shall amend Section 2.21 hereof or
adversely affect the rights and obligations of the Issuing Bank hereunder
without its prior written consent. Each holder of a Commitment, a Loan or a note
evidencing any Loan hereunder shall be bound by any amendment, modification,
waiver or consent authorized as provided herein (whether or not any applicable
note shall have been marked to indicate such amendment, modification, waiver or
consent); and any consent by any holder of a Commitment, a Loan or a note shall
bind any Person subsequently acquiring such Commitment, Loan or note (whether or
not any applicable note is so marked).
123
(b) If a condition to Borrowing or the issuance of a Letter of
Credit hereunder is not satisfied or some other event occurs that would prohibit
the Borrower from borrowing or receiving a Letter of Credit hereunder, then in
order to waive such condition or consent to such event, the consent of the
Required Revolving Credit Lenders (as a separate group) shall be required in
addition to any other consent required pursuant this Credit Agreement.
(c) Notwithstanding the foregoing provisions of this Section
13.11 or anything to the contrary contained in this Credit Agreement, any Lender
which has requested that it not receive material, non-public information
concerning the Borrower or any of the other Credit Parties and which is
therefore unable or unwilling to vote with respect to an issue arising under
this Credit Agreement will agree to vote and will be deemed to have voted its
Credit Exposure under this Credit Agreement pro rata in accordance with the
percentage of Credit Exposure voted in favor of, and the percentage of Credit
Exposure voted against, any such issue under this Credit Agreement.
(d) If the Borrower shall have requested a waiver, consent, or
amendment from the Lenders of any of the matters described in clauses (i)
through (vii) of Section 13.11(a), and the Borrower shall have received such
waiver, consent, or amendment from Lenders holding greater than 50% of the Total
Credit Exposure (or in the case of such a waiver, consent or amendment relating
to a single Tranche, greater than 50% of the aggregate Credit Exposure of all
Lenders with respect to such Tranche), then with respect to any Lender that has
not consented (the "Non-Consenting Lenders"), the Borrower may, upon at least
five (5) Business Days' prior written or facsimile notice to such Lender and the
Administrative Agent, identify to the Administrative Agent a Purchasing Lender
which will purchase (for an amount, in immediately available funds, equal to the
principal amount of outstanding Loans payable to such Non-Consenting Lender,
plus all accrued but unpaid interest and fees payable to such Non-Consenting
Lender), the Commitments of such Non-Consenting Lender (if applicable), and such
Non-Consenting Lender shall thereupon assign any Loans owing to such
Non-Consenting Lender, its Commitments (if applicable) and any notes held by
such Non-Consenting Lender to such Purchasing Lender pursuant to Section 13.3
hereof; provided, that the consent of the Administrative Agent required pursuant
to Section 13.3 hereof shall not be unreasonably withheld.
SECTION 13.12 Severability. Any provision of this Credit
Agreement or of any note evidencing any Loan hereunder which is invalid, illegal
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without invalidating the remaining provisions hereof, and any such invalidity,
illegality or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
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SECTION 13.13 SERVICE OF PROCESS. EACH PARTY HERETO (EACH A
"SUBMITTING PARTY") HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE STATE
COURTS OF THE STATE OF NEW YORK IN NEW YORK COUNTY AND TO THE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK SITTING
IN NEW YORK COUNTY, FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING
ARISING OUT OF OR BASED UPON THIS CREDIT AGREEMENT (INCLUDING, BUT NOT LIMITED
TO, THE LETTERS OF CREDIT, THE SUBJECT MATTER HEREOF AND ANY OTHER FUNDAMENTAL
DOCUMENT AND THE SUBJECT MATTER THEREOF). EACH SUBMITTING PARTY TO THE EXTENT
PERMITTED BY APPLICABLE LAW (A) HEREBY WAIVES, AND AGREES NOT TO ASSERT, BY WAY
OF MOTION, AS A DEFENSE, OR OTHERWISE, IN ANY SUCH SUIT, ACTION OR OTHER
PROCEEDING BROUGHT IN THE ABOVE-NAMED COURTS, ANY CLAIM THAT IT IS NOT SUBJECT
PERSONALLY TO THE JURISDICTION OF SUCH COURTS, THAT ITS PROPERTY IS EXEMPT OR
IMMUNE FROM ATTACHMENT OR EXECUTION, THAT THE SUIT, ACTION OR PROCEEDING IS
BROUGHT IN AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR
PROCEEDING IS IMPROPER OR THAT THIS CREDIT AGREEMENT, THE SUBJECT MATTER HEREOF
AND ANY OTHER FUNDAMENTAL DOCUMENT OR THE SUBJECT MATTER THEREOF (AS APPLICABLE)
MAY NOT BE ENFORCED IN OR BY SUCH COURT AND (B) HEREBY WAIVES THE RIGHT TO
ASSERT IN ANY SUCH ACTION, SUIT OR PROCEEDING ANY OFFSETS OR COUNTERCLAIMS
EXCEPT COUNTERCLAIMS THAT ARE COMPULSORY OR OTHERWISE ARISE FROM THE SAME
SUBJECT MATTER. EACH SUBMITTING PARTY HEREBY CONSENTS TO SERVICE OF PROCESS BY
MAIL AT THE ADDRESS TO WHICH NOTICES ARE TO BE GIVEN TO IT PURSUANT TO SECTION
13.1 HEREOF. EACH SUBMITTING PARTY AGREES THAT ITS SUBMISSION TO JURISDICTION
AND CONSENT TO SERVICE OF PROCESS BY MAIL IS MADE FOR THE EXPRESS BENEFIT OF
EACH OF THE OTHER SUBMITTING PARTIES. FINAL JUDGMENT AGAINST ANY SUBMITTING
PARTY IN ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE, AND MAY BE
ENFORCED IN ANY OTHER JURISDICTION (X) BY SUIT, ACTION OR PROCEEDING ON THE
JUDGMENT, A CERTIFIED OR TRUE COPY OF WHICH SHALL BE CONCLUSIVE EVIDENCE OF THE
FACT AND OF THE AMOUNT OF INDEBTEDNESS OR LIABILITY OF THE SUBMITTING PARTY
THEREIN DESCRIBED OR (Y) IN ANY OTHER MANNER PROVIDED BY OR PURSUANT TO THE LAWS
OF SUCH OTHER JURISDICTION; PROVIDED, HOWEVER, THAT THE ADMINISTRATIVE AGENT AND
THE ISSUING BANK MAY AT THEIR OPTION BRING SUIT, OR INSTITUTE OTHER JUDICIAL
PROCEEDINGS AGAINST A SUBMITTING PARTY OR ANY OF ITS ASSETS IN ANY ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ OR OF ANY COUNTRY OR PLACE WHERE THE
SUBMITTING PARTY OR SUCH ASSETS MAY BE FOUND.
SECTION 13.14 Headings. Section headings used herein and the
Table of Contents are for convenience only and are not to affect the
construction of or be taken into consideration in interpreting this Credit
Agreement.
SECTION 13.15 Execution in Counterparts. This Credit Agreement
may be executed in any number of counterparts, each of which shall constitute an
original, but all of which taken together shall constitute one and the same
instrument. Signature pages may be detached from counterpart documents and
reassembled to form duplicate executed originals. Delivery of an executed
signature page to this Credit Agreement by facsimile shall be as effective as
delivery of a manually executed counterpart of this Credit Agreement.
125
SECTION 13.16 Subordination of Intercompany Indebtedness,
Receivables and Advances. (a) Each Credit Party hereby agrees that any
intercompany Indebtedness or other intercompany receivables or intercompany
advances of any other Credit Party, directly or indirectly, in favor of such
Credit Party of whatever nature at any time outstanding shall be completely
subordinate in right of payment to the prior indefeasible payment in full of the
Obligations, and that no payment on any such Indebtedness, receivable or advance
shall be made until the prior indefeasible payment in full of all the
Obligations, termination of the Commitments and the expiration and/or
termination of all Letters of Credit (or the cash collateralization of the
outstanding Letters of Credit in an amount equal to 105% of the then current L/C
Exposure) (i) except intercompany receivables and intercompany advances
permitted pursuant to the terms hereof may be repaid, and interest, fees and
other related amounts may be paid, and intercompany Indebtedness permitted
pursuant to the terms hereof may be repaid, and interest, fees and other related
amounts may be paid, in each case so long as no Default or Event of Default,
shall have occurred and be continuing and (ii) except as specifically consented
to by the Administrative Agent and the Required Lenders in writing.
(b) In the event that any payment on any such Indebtedness
shall be received by such Credit Party other than as permitted by Section
13.16(a) hereof before payment in full of all Obligations, termination of the
Commitments and the expiration and/or termination of all Letters of Credit (or
the cash collateralization of the outstanding Letters of Credit in an amount
equal to 105% of the then current L/C Exposure), such Credit Party shall receive
such payments and hold the same in trust for, segregate the same from its own
assets and shall immediately pay over to, the Administrative Agent on behalf of
the Secured Parties all such sums to the extent necessary so that the Secured
Parties shall have been paid all Obligations owed or which may become owing.
SECTION 13.17 Confidentiality. Each of the Lenders understands
that some of the information furnished to it pursuant to this Credit Agreement
may be received by it prior to the time that such information shall have been
made public, and each of the Lenders hereby agrees that it will keep all the
information received by it in connection with this Credit Agreement confidential
except that a Lender shall be permitted to disclose information (i) to such of
its officers, directors, employees, agents, representatives, auditors,
consultants, advisors, trustees, investment advisors, lawyers and affiliates as
need to know such information in connection with this Credit Agreement or any
other Fundamental Document, so long as such disclosure is subject to the
understanding that it remain confidential pursuant to the terms hereof; (ii) to
a proposed assignee or participant in accordance with Section 13.3(h) hereof, so
long as such disclosure is subject to the understanding that it remain
confidential pursuant to the terms hereof; (iii) to the extent required by
Applicable Law and regulations or by any subpoena or other legal process (in any
which event such Lender shall promptly notify the Borrower to the extent not
prohibited by Applicable Law); (iv) to the extent requested by any bank
regulatory authority or other regulatory authority; (v) to the extent such
information (A) becomes publicly available other than as a result of a breach of
this Credit Agreement, (B) becomes available to such Lender on a nonconfidential
basis from a source other than the Borrower or any of its Affiliates, which
source is not known to such Lender to be prohibited from transmitting the
information to such Lender by any contractual or other obligation to the
Borrower or (C) was available to such Lender on a nonconfidential basis prior to
its disclosure to such Lender; (vi) to the extent the Borrower shall have
consented to such disclosure in writing; or (vii) in any proceeding brought by a
Lender against the Borrower for the purpose of protecting or enforcing any of
its rights and/or remedies in connection with any Fundamental Document or in any
other proceeding (including any counter-claim) brought against a Lender in
connection with any Fundamental Document or any of the transactions contemplated
thereby. Notwithstanding anything else in this Credit Agreement or the
Fundamental Documents to the contrary, each party hereto (and each employee,
representative, or other agent of any party) may disclose to any and all
126
persons, without limitation of any kind, the Federal income tax treatment and
Federal tax structure of any and all transaction(s) contemplated herein and all
materials of any kind (including opinions or other tax analyses) that are or
have been provided to any party (or to any employee, representative, or other
agent of any party) relating to such tax treatment or tax structure, provided,
however, that this authorization of disclosure shall not apply to restrictions
reasonably necessary to comply with securities laws. This authorization of
disclosure is retroactively effective immediately upon commencement of the first
discussions regarding the transactions contemplated herein, and the parties aver
and affirm that this tax disclosure authorization has been given on a date which
is no later than 30 days from the first day that any party hereto (or any
employee, representative, or other agent of any party hereto) first made or
provided a statement as to the potential tax consequences that may result from
the transactions contemplated hereby. Notwithstanding Section 13.2 of this
Agreement, the confidentiality obligations set forth in this Section 13.17 shall
survive the Facility Termination Date and the termination of this Credit
Agreement.
SECTION 13.18 Entire Agreement. This Credit Agreement
(including the Exhibits and Schedules hereto) represents the entire agreement of
the parties with regard to the subject matter hereof and the terms of any
letters and other documentation entered into between any of the parties hereto
(other than the Fee Letter) prior to the execution of this Credit Agreement
which relate to Loans to be made or Letters of Credit to be issued hereunder
shall be replaced by the terms of this Credit Agreement.
SECTION 13.19 Enforcement of Rights; No Obligation to ▇▇▇▇▇▇▇▇
Assets. In enforcing any rights under this Credit Agreement or any other
Fundamental Document, neither the Administrative Agent, the Issuing Bank, any
Lender nor any of the other Secured Parties shall be required to resort to any
particular security, right or remedy through foreclosure or otherwise, or to
proceed in any particular order of priority, or to otherwise act or refrain from
acting; and, to the extent permitted by Applicable Law, each Credit Party hereby
waives and releases any right to a marshaling of assets or a sale in inverse
order of alienation.
SECTION 13.20 Reproduction of Documents. The Credit Agreement,
all documents constituting Schedules or Exhibits hereto, and all documents
relating hereto received by a party hereto, including, without limitation: (a)
consents, waivers and modifications that may hereafter be executed; (b) the
Fundamental Documents; and (c) financial statements, certificates, and other
information previously or hereafter furnished to any of the Agents, the Issuing
Bank, any Lender or any other Secured Party may be reproduced by the party
receiving the same by any photographic, photostatic, microfilm, micro-card,
miniature photographic or other similar process. Each of the parties hereto
agrees and stipulates that, to the extent permitted by Applicable Law, any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by such party in the
regular course of business) and that, to the extent permitted by applicable law,
any enlargement, facsimile, or further reproduction of such reproduction shall
likewise be admissible in evidence.
127
SECTION 13.21 Right of Set-Off. Subject to Section 12.3 upon
the occurrence and during the continuance of any Event of Default, the
Administrative Agent and each Lender is hereby authorized at any time and from
time to time, to the fullest extent permitted by law and without order of or
application to any court, to set-off and apply any and all deposits (general or
special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by the Administrative Agent and each such Lender
or any Affiliate thereof to or for the credit or the account of any Credit Party
against any and all of the Obligations, irrespective of whether or not such
Lender shall have made any demand under any Fundamental Document and although
the Obligations may not have been accelerated. The rights of each Lender and the
Administrative Agent under this Section are in addition to other rights and
remedies which such Lender and the Administrative Agent may have upon the
occurrence and during the continuance of any Event of Default.
SECTION 13.22 Consolidated Subsidiaries. In the event that for
any Rolling Four Quarter period the Consolidated EBITDA attributable to
Consolidated Subsidiaries which are not Credit Parties (other than the
Borrower's captive insurance subsidiary) is greater than 5% of Consolidated
EBITDA of the Borrower and its Consolidated Subsidiaries, then all calculations
of Consolidated EBITDA, Consolidated EBITDAR, Consolidated Fixed Charged
Coverage Ratio, Consolidated Interest Expense, Consolidated Net Income,
Consolidated Net Working Assets, Consolidated Net Worth, Consolidated Rental
Expense, Consolidated Tangible Assets, Total Leverage Ratio and Total Funded
Debt, with respect to such Rolling Four Quarter Period, shall all be computed
based on the financial performance of the Borrower and the Credit Parties on a
consolidated basis without including the assets, liabilities, income, or loss of
any Person which is not a Credit Party (other than the Borrower's captive
insurance subsidiary) except to the extent of any distribution or dividend
actually paid to the Borrower or any Credit Party by such Person during such
period.
[Signature Pages Follow]
128
IN WITNESS WHEREOF, the undersigned have caused this Credit Agreement
to be executed as of the date first written above.
BORROWER:
GENESIS HEALTHCARE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
GUARANTORS:
-----------
ACADEMY NURSING HOME, INC.
ADS APPLE VALLEY, INC.
ADS CONSULTING, INC.
ADS DANVERS ALF, INC.
ADS DARTMOUTH ALF, INC.
ADS HINGHAM ALF, INC.
ADS HINGHAM NURSING FACILITY, INC.
ADS HOME HEALTH, INC.
ADS MANAGEMENT, INC.
ADS PALM CHELMSFORD, INC.
ADS RECUPERATIVE CENTER, INC.
ADS RESERVOIR WALTHAM, INC.
ADS SENIOR HOUSING, INC.
ADS/MULTICARE, INC.
ANR, INC.
APPLEWOOD HEALTH RESOURCES, INC.
ASL, INC.
ASSISTED LIVING ASSOCIATES OF BERKSHIRE, INC.
ASSISTED LIVING ASSOCIATES OF LEHIGH, INC.
ASSISTED LIVING ASSOCIATES OF SANATOGA, INC.
BERKS NURSING HOMES, INC.
BRIGHTWOOD PROPERTY, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
BRINTON MANOR, INC.
BURLINGTON ▇▇▇▇▇ CONVALESCENT CENTER, INC.
CAREFLEET, INC.
CENTURY CARE MANAGEMENT, INC.
CHATEAU VILLAGE HEALTH RESOURCES, INC.
CHELTENHAM LTC MANAGEMENT, INC.
CHG INVESTMENT CORP., INC.
CHNR-I, INC.
COLONIAL HALL HEALTH RESOURCES, INC.
CONCORD HEALTH GROUP, INC.
CONCORD SERVICE CORPORATION
CRESTVIEW CONVALESCENT HOME, INC.
CRESTVIEW NORTH, INC.
CRYSTAL CITY NURSING CENTER, INC.
CVNR, INC.
▇▇▇▇ VIEW MANOR, INC.
DELM NURSING, INC.
DERBY NURSING CENTER CORPORATION
▇▇▇▇▇ ▇▇▇▇▇▇ AND ASSOCIATES, INC.
DOVER HEALTH CARE ASSOCIATES, INC.
ELDERCARE RESOURCES CORP.
ELMWOOD HEALTH RESOURCES, INC.
ENCARE OF PENNYPACK, INC.
ENCARE OF QUAKERTOWN, INC.
ENCARE OF WYNCOTE, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
ENR, INC.
GENESIS ELDERCARE CENTERS - BELVEDERE, INC.
GENESIS ELDERCARE CENTERS - CHAPEL MANOR, INC.
GENESIS ELDERCARE CENTERS-▇▇▇▇▇▇▇, INC.
GENESIS ELDERCARE CENTERS - PENNSBURG, INC.
GENESIS ELDERCARE CORP.
GENESIS ELDERCARE DIAGNOSTIC SERVICES, INC.
GENESIS ELDERCARE HOME CARE SERVICES, INC.
GENESIS ELDERCARE HOSPITALITY SERVICES, INC.
GENESIS ELDERCARE LIVING FACILITIES, INC.
GENESIS ELDERCARE NATIONAL CENTERS, INC.
GENESIS ELDERCARE NETWORK SERVICES OF MASSACHUSETTS, INC.
GENESIS ELDERCARE NETWORK SERVICES, INC.
GENESIS ELDERCARE PARTNERSHIP CENTERS, INC.
GENESIS ELDERCARE PHYSICIAN SERVICES, INC.
GENESIS ELDERCARE PROPERTIES, INC.
GENESIS ELDERCARE REHABILITATION SERVICES, INC.
GENESIS ELDERCARE STAFFING SERVICES, INC.
GENESIS ELDERCARE TRANSPORTATION SERVICES, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
GENESIS HEALTH VENTURES OF ARLINGTON, INC.
GENESIS HEALTH VENTURES OF BLOOMFIELD, INC.
GENESIS HEALTH VENTURES OF CLARKS SUMMIT, INC.
GENESIS HEALTH VENTURES OF INDIANA, INC.
GENESIS HEALTH VENTURES OF ▇▇▇▇▇▇, INC.
GENESIS HEALTH VENTURES OF MASSACHUSETTS, INC.
GENESIS HEALTH VENTURES OF NAUGATUCK, INC.
GENESIS HEALTH VENTURES OF NEW GARDEN, INC.
GENESIS HEALTH VENTURES OF POINT PLEASANT, INC.
GENESIS HEALTH VENTURES OF SALISBURY, INC.
GENESIS HEALTH VENTURES OF ▇▇▇▇▇, INC.
GENESIS HEALTH VENTURES OF WEST VIRGINIA, INC.
GENESIS HEALTH VENTURES OF ▇▇▇▇▇▇-▇▇▇▇▇, INC.
GENESIS HEALTH VENTURES OF WINDSOR, INC.
GENESIS HEALTHCARE CENTERS HOLDINGS, INC.
GENESIS HEALTHCARE HOLDING COMPANY I, INC.
GENESIS HEALTHCARE HOLDING COMPANY II, INC.
GENESIS IMMEDIATE MED CENTER, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
GENESIS PROPERTIES OF DELAWARE CORPORATION
GENESIS SELECTCARE CORP.
GENESIS/VNA PARTNERSHIP HOLDING COMPANY, INC.
GERIATRIC & MEDICAL COMPANIES, INC.
GERIATRIC AND MEDICAL INVESTMENTS CORPORATION
GERIATRIC AND MEDICAL SERVICES, INC.
▇▇▇▇-MED CORP.
GLENMARK ASSOCIATES - DAWNVIEW MANOR, INC.
GLENMARK ASSOCIATES, INC.
GLENMARK PROPERTIES, INC.
GMA-BRIGHTWOOD, INC.
GMA-MADISON, INC.
GMA - UNIONTOWN, INC.
GMA PARTNERSHIP HOLDING COMPANY, INC.
GMC LEASING CORPORATION
GMC-LTC MANAGEMENT, INC.
GMS INSURANCE SERVICES, INC.
GOVERNOR'S HOUSE NURSING HOME, INC.
HEALTH RESOURCES OF ACADEMY MANOR, INC.
HEALTH RESOURCES OF ▇▇▇▇▇▇▇▇, INC.
HEALTH RESOURCES OF BROOKLYN, INC.
HEALTH RESOURCES OF CEDAR GROVE, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
HEALTH RESOURCES OF CINNAMINSON, INC.
HEALTH RESOURCES OF COLCHESTER, INC.
HEALTH RESOURCES OF COLUMBUS, INC.
HEALTH RESOURCES OF CUMBERLAND, INC.
HEALTH RESOURCES OF ENGLEWOOD, INC.
HEALTH RESOURCES OF ▇▇▇▇▇, INC.
HEALTH RESOURCES OF FARMINGTON, INC.
HEALTH RESOURCES OF ▇▇▇▇▇▇▇, INC.
HEALTH RESOURCES OF GLASTONBURY, INC.
HEALTH RESOURCES OF GROTON, INC.
HEALTH RESOURCES OF LAKEVIEW, INC.
HEALTH RESOURCES OF LEMONT, INC.
HEALTH RESOURCES OF ▇▇▇▇▇▇▇▇, INC.
HEALTH RESOURCES OF MIDDLETOWN (RI), INC.
HEALTH RESOURCES OF MORRISTOWN, INC.
HEALTH RESOURCES OF NORTH ANDOVER, INC.
HEALTH RESOURCES OF ROCKVILLE, INC.
HEALTH RESOURCES OF SOLOMONT BROOKLINE, INC.
HEALTH RESOURCES OF ▇▇▇▇ HILLS, INC.
HEALTH RESOURCES OF WALLINGFORD, INC.
HEALTH RESOURCES OF WARWICK, INC.
HEALTH RESOURCES OF WESTWOOD, INC.
HEALTHCARE RESOURCES CORP.
HELSTAT, INC.
HILLTOP HEALTH CARE CENTER, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
HMNH REALTY, INC.
HNCA, INC.
HORIZON ASSOCIATES, INC.
HORIZON MOBILE, INC.
HORIZON REHABILITATION, INC.
HR OF CHARLESTON, INC.
HRWV HUNTINGTON, INC.
INNOVATIVE HEALTH CARE MARKETING, INC.
KEYSTONE NURSING HOME, INC.
KNOLLWOOD MANOR, INC.
KNOLLWOOD NURSING HOME, INC.
LAKE MANOR, INC.
LAKEWOOD HEALTH RESOURCES, INC.
LAUREL HEALTH RESOURCES, INC.
LEHIGH NURSING HOMES, INC.
LIFE SUPPORT MEDICAL EQUIPMENT, INC.
LIFE SUPPORT MEDICAL, INC.
LRC HOLDING COMPANY, INC.
LWNR, INC.
MABRI CONVALESCENT CENTER, INC.
MANOR MANAGEMENT CORP. OF GEORGIAN MANOR, INC.
MARLINTON ASSOCIATES, INC.
MARLINTON PARTNERSHIP HOLDING COMPANY, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
▇▇▇▇▇▇▇▇ HEALTH CARE CENTER-CONCORD, INC.
▇▇▇▇▇▇▇▇ HEALTH CARE CENTERS, INC.
MERIDIAN HEALTH, INC.
MERIDIAN HEALTHCARE INVESTMENTS, INC.
MERIDIAN HEALTHCARE, INC.
MHNR, INC.
MNR, INC.
▇▇▇▇▇▇▇▇▇▇ NURSING HOMES, INC.
MULTICARE AMC, INC.
NURSING AND RETIREMENT CENTER OF THE ANDOVERS, INC.
OAK HILL HEALTH CARE CENTER, INC.
PHC OPERATING CORP.
PHILADELPHIA AVENUE CORPORATION
POCAHONTAS CONTINUOUS CARE CENTER, INC.
PRESCOTT NURSING HOME, INC.
PROSPECT PARK LTC MANAGEMENT, INC.
PROVIDENCE FUNDING CORPORATION
PROVIDENCE HEALTH CARE, INC.
REST HAVEN NURSING HOME, INC.
RHS MEMBERSHIP INTEREST HOLDING COMPANY
RIDGELAND HEALTH RESOURCES, INC.
RIVERSHORES HEALTH RESOURCES, INC.
RLNR, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
ROSE HEALTHCARE, INC.
ROSE VIEW MANOR, INC.
RSNR, INC.
RVNR, INC.
S. T. B. INVESTORS, LTD.
SCHUYLKILL NURSING HOMES, INC.
SENIOR LIVING VENTURES, INC.
SENIOR SOURCE, INC.
SNOW VALLEY HEALTH RESOURCES, INC.
SOLOMONT FAMILY MEDFORD VENTURE, INC.
▇▇▇▇▇▇▇▇ CONVALESCENT CENTER, INC.
STATE STREET ASSOCIATES, INC.
SVNR, INC.
THE ADS GROUP, INC.
THE APPLE VALLEY PARTNERSHIP HOLDING COMPANY, INC.
THE HOUSE OF ▇▇▇▇▇▇▇▇, INC.
THE MULTICARE COMPANIES, INC.
TMC ACQUISITION CORP.
TRI STATE MOBILE MEDICAL SERVICES, INC.
VALLEY MEDICAL SERVICES, INC.
VALLEY TRANSPORT AMBULANCE SERVICE, INC.
VERSALINK, INC.
VILLAS REALTY & INVESTMENTS, INC.
WALNUT LTC MANAGEMENT, INC.
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
WAYSIDE NURSING HOME, INC.
▇▇▇▇▇▇▇▇▇▇ AMBULANCE SERVICE, INC.
WEST PHILA. LTC MANAGEMENT, INC.
WESTFORD NURSING AND RETIREMENT CENTER, INC.
WILLOW MANOR NURSING HOME, INC.
WYNCOTE HEALTHCARE CORP.
YE OLDE AMBULANCE COMPANY, INC.
YORK LTC MANAGEMENT, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer of each of the
foregoing entities
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
ADS APPLE VALLEY LIMITED PARTNERSHIP
By: ADS Apple Valley, Inc., its general partner
ADS HINGHAM LIMITED PARTNERSHIP
By: ADS Hingham Nursing Facility, Inc., its general partner
ADS RECUPERATIVE CENTER LIMITED PARTNERSHIP
By: ADS Recuperative Center, Inc., its general partner
BREVARD MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
CARE HAVEN ASSOCIATES LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general partner
CATONSVILLE MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc. and Meridian Health, Inc., its general
partners
CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P.
By: Health Resources of Cumberland, Inc., its general partner
EASTON MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc. and Meridian Health, Inc., its general
partners
EDELLA STREET ASSOCIATES
By: Genesis Health Ventures of Clarks Summit, Inc., its general
partner
GENESIS ELDERCARE CENTERS I, L.P.
By: Genesis Eldercare Partnership Centers, Inc., its general partner
GENESIS ELDERCARE CENTERS II, L.P.
By: Genesis Eldercare Partnership Centers, Inc., its general partner
GENESIS ELDERCARE CENTERS III, L.P.
By: Genesis Eldercare Partnership Centers, Inc., its general partner
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
GENESIS HEALTH VENTURES OF WEST VIRGINIA, L.P.
By: Meridian Healthcare, Inc. and Meridian Health, Inc., its general
partners
GENESIS PROPERTIES LIMITED PARTNERSHIP
By: Genesis Health Ventures of Arlington, Inc., its general partner
GENESIS PROPERTIES OF DELAWARE LTD. PARTNERSHIP, L.P.
By: Genesis Properties of Delaware Corporation, its general partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general partner
GREENSPRING MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
GROTON ASSOCIATES OF CONNECTICUT, L.P.
By: Health Resources of Groton, Inc., its general partner
▇▇▇▇▇▇▇▇ ▇▇▇▇ MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc. and Meridian Health, Inc., its general
partners
▇▇▇▇▇▇▇▇ HEALTH CARE CENTER-CONCORD LIMITED PARTNERSHIP
By: ▇▇▇▇▇▇▇▇ Health Care Center-Concord, Inc., its general partner
MERIDIAN/CONSTELLATION LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
MERIDIAN EDGEWOOD LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
MERIDIAN PERRING LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
MERIDIAN VALLEY LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
MERIDIAN VALLEY VIEW LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P.
By: Health Resources of Middletown (RI), Inc., its general partner
MILLVILLE MERIDIAN LIMITED PARTNERSHIP
By: Meridian Healthcare, Inc., its general partner
NORRISTOWN NURSING AND REHABILITATION CENTER, ASSOCIATES, L.P.
By: GMC-LTC Management, Inc., its general partner
NORTH CAPE CONVALESCENT CENTER ASSOCIATES, L.P.
By: Geriatric and Medical Services, Inc., its general
partner
PHILADELPHIA AVENUE ASSOCIATES
By: Philadelphia Avenue Corporation, its general partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP
By: Glenmark Associates, Inc. and GMA Partnership Holding Company,
Inc., its general partners
RALEIGH MANOR LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general partner
RIVER STREET ASSOCIATES
By: Genesis Health Ventures of ▇▇▇▇▇▇-▇▇▇▇▇, Inc., its general
partner
ROMNEY HEALTH CARE CENTER, LTD., LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general partner
SEMINOLE MERIDIAN LIMITED PARTNERSHIP
By: Meridian Health, Inc., its general partner
SISTERSVILLE HAVEN LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general partner
STATE STREET ASSOCIATES, L.P.
By: State Street Associates, Inc., its general partner
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP
By: Glenmark Associates, Inc., its general partner
THE ▇▇▇▇▇▇ GROUP-▇▇▇▇▇▇▇ HOUSE, L.P.
By: Encare of Wyncote, Inc., its general partner
THE ▇▇▇▇▇▇ GROUP-QUAKERTOWN MANOR, L.P.
By: Encare of Quakertown, Inc., its general partner
THERAPY CARE SYSTEMS, L.P.
By: Genesis ElderCare Rehabilitation Services, Inc., its general
partner
VOLUSIA MERIDIAN LIMITED PARTNERSHIP
By: Meridian Health, Inc., its general partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P.
By: Health Resources of Wallingford, Inc., its general partner
WARWICK ASSOCIATES OF RHODE ISLAND, L.P.
By: Health Resources of Warwick, Inc., its general partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer of the
respective general partners of each of the
foregoing entities
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
▇▇▇▇▇ ▇▇▇▇▇ ASSOCIATES OF NEW JERSEY, L.P.
By: Encare of Mendham, L.L.C., its general partner
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P.
By: Breyut Convalescent Center, L.L.C., its general partner
POMPTON ASSOCIATES, L.P.
By: Pompton Care, L.L.C., its general partner
THE ▇▇▇▇▇▇ GROUP-OLD BRIDGE, L.P.
By: Health Resources of ▇▇▇▇▇, L.L.C., its general partner
THE ▇▇▇▇▇▇ GROUP-RIDGEWOOD, L.P.
By: Health Resources of Ridgewood, L.L.C., its general partner
By: Century Care Management, Inc., the manager of the respective
general partners of each of the foregoing entities
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
ARCADIA ASSOCIATES
By: ADS/Multicare, Inc., its managing partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer
▇▇▇▇▇▇▇▇ HEALTH FACILITIES
By: Meridian Healthcare, Inc. and Meridian Health, Inc., its partners
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Title: Senior Vice President, Planning and
Development, and Treasurer of each of the
partners of the foregoing entity
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
BREYUT CONVALESCENT CENTER, L.L.C.
ENCARE OF MENDHAM, L.L.C.
HEALTH RESOURCES OF BRIDGETON, L.L.C.
HEALTH RESOURCES OF CINNAMINSON, L.L.C.
HEALTH RESOURCES OF CRANBURY, L.L.C.
HEALTH RESOURCES OF EATONTOWN, L.L.C.
HEALTH RESOURCES OF ▇▇▇▇▇, L.L.C.
HEALTH RESOURCES OF ENGLEWOOD, L.L.C.
HEALTH RESOURCES OF ▇▇▇▇▇, L.L.C.
HEALTH RESOURCES OF FAIR LAWN, L.L.C.
HEALTH RESOURCES OF ▇▇▇▇▇▇▇, L.L.C.
HEALTH RESOURCES OF RIDGEWOOD, L.L.C.
HEALTH RESOURCES OF SOUTH BRUNSWICK, L.L.C.
HEALTH RESOURCES OF WEST ORANGE, L.L.C.
POMPTON CARE, L.L.C.
ROEPHEL CONVALESCENT CENTER, L.L.C.
By: Century Care Management, Inc., the manager of
each of the foregoing entities
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
GENESIS-GEORGETOWN SNF/JV, LLC
GLENMARK LIMITED LIABILITY COMPANY I
MILFORD ALF, LLC
RESPIRATORY HEALTH SERVICES LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Senior Vice President, Planning and
Development, and Treasurer of each of the
foregoing entities
[SIGNATURE PAGE TO CREDIT, SECURITY, GUARANTY AND PLEDGE AGREEMENT]
WACHOVIA BANK, NATIONAL ASSOCIATION, as
Administrative Agent and Lender
By: /s/ ▇▇▇▇▇ Santa ▇▇▇▇
--------------------------------------------
Name: ▇▇▇▇▇ Santa ▇▇▇▇, Director
Its Duly Authorized Signature
Revolving Credit Commitment: $ 30,000,000
Term Loan B Commitment: $110,000,000
Total Commitment: $140,000,000
UBS LOAN FINANCE LLC, as Lender
By: /s/ ▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
--------------------------------------------
▇▇▇▇▇▇▇▇ ▇'▇▇▇▇▇
Director
By: /s/ ▇▇▇▇▇▇▇ ▇. Saint
--------------------------------------------
▇▇▇▇▇▇▇ ▇. Saint
Associate Director
Banking Products
Services, US
Revolving Credit Commitment: $5,000,000.00
Term Loan B Commitment: $ 000.00
Total Commitment: $5,000,000.00
CITICORP NORTH AMERICA, INC., as Syndication
Agent and Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Director/Vice President
Its Duly Authorized Signature
Revolving Credit Commitment: $20,000,000.00
Term Loan B Commitment: $30,000,000.00
Total Commitment: $50,000,000.00
GENERAL ELECTRIC CAPITAL CORPORATION, as
Documentation Agent and Lender
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Its Duly Authorized Signature
Revolving Credit Commitment: $20,000,000.00
Term Loan B Commitment: $45,000,000.00
Total Commitment: $65,000,000.00