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Exhibit 10.6
FOURTH AMENDMENT AND WAIVER TO
SECOND AMENDED AND RESTATED CREDIT AGREEMENT
THIS FOURTH AMENDMENT AND WAIVER (this "Amendment") to the Second Amended
and Restated Credit Agreement referred to below is made as of October 14, 1999
by and among NEW AMERICAN HEALTHCARE CORPORATION, a Delaware corporation (the
"Borrower"), TORONTO DOMINION (TEXAS), INC., as agent for the financial
institutions party hereto (in such capacity, the "Agent"), THE TORONTO-DOMINION
BANK, as Issuing Bank and THE FINANCIAL INSTITUTIONS PARTY HERETO
(collectively, the "Banks"; individually, a "Bank").
W I T N E S S E T H
WHEREAS, the Borrower, the Agent, the Issuing Bank and the Banks are party
to that certain Second Amended and Restated Credit Agreement, dated as of May
14, 1999 (as amended, supplemented or otherwise modified from time to time,
prior to the date hereof, the "Credit Agreement"); and
WHEREAS, the Agent, the Issuing Bank and the Banks have agreed to amend,
and to waive certain violations of, the Credit Agreement in the manner, and on
the terms and conditions, provided for herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. CERTAIN DEFINITIONS. Capitalized terms used herein and not otherwise
defined shall have the meanings ascribed to them in the Credit Agreement.
2. AMENDMENTS.
(a) The definition of "Permitted Purposes" set forth in Section 1.1 of
the Credit Agreement is hereby amended as of the Amendment Effective Date (as
hereinafter defined) by inserting the following new sentence as the end thereof:
"Notwithstanding the foregoing, no Capital Expenditure in an amount in
excess of $100,000 shall be deemed to be a Permitted Purpose unless
otherwise approved by the Agent."
(b) Section 7.2 of the Credit Agreement is hereby amended as of the
Amendment Effective Date by inserting the following new subsection at the end
thereof:
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"(u) To the Agent, with sufficient copies for distribution by the
Agent to each of the Banks, not later than Friday of each week, commencing
on October 22, 1999, a rolling cash flow forecast for the succeeding
13-week period in the form attached hereto as EXHIBIT 7.2(u)."
(c) Exhibit 2.1(c) to the Credit Agreement is hereby amended as of the
Amendment Effective Date by deleting such Exhibit in its entirety and inserting
in lieu thereof a new Exhibit in the form attached hereto as Exhibit 2.1(c).
(d) The Credit Agreement is hereby further amended as of the Amendment
Effective Date by inserting a new Exhibit 7.2(u) immediately following Exhibit
4.2-2 to the Credit Agreement.
3. CAPITAL EXPENDITURES BUDGET. On or before October 20, 1999, the
Borrower shall deliver to the Agent a revised Capital Expenditures Budget in
form and substance satisfactory to the Agent (the "Budget"). The parties hereto
agree that failure to deliver the same shall constitute an immediate Event of
Default for any and all purposes under the Credit Agreement and the other Loan
Documents. Upon delivery of the Budget, Schedule 8.11 to the Credit Agreement
shall be deemed to be amended as of such date by deleting such Schedule in its
entirety and inserting in lieu thereof a new Schedule in the form of the Budget.
4. WAIVER. The Majority Banks hereby waive any Event of Default which
arises solely from the failure of Borrower to have EBITDAR of at least $896,000
for the month ended August 31, 1999, as required by Section 7.18(a)(iv) of the
Credit Agreement.
5. RATIFICATION OF CREDIT AGREEMENT. The Credit Agreement and the other
Loan Documents shall continue to be in full force and effect in accordance with
their respective terms and, except as expressly provided herein, shall be
unmodified. In addition, except as expressly provided herein, this Amendment
shall not be deemed a waiver of any term or condition of any Loan Document by
the Agent or the Banks with respect to any right or remedy which the Agent or
the Banks may now or in the future have under the Loan Documents, at law or in
equity or otherwise or be deemed to prejudice any rights or remedies which the
Agent or the Banks may now have or may have in the future under or in
connection with any Loan Document or under or in connection with any Incipient
Default or Event of Default which may now exist or which may occur after the
date hereof. Except as expressly provided herein, the Credit Agreement and all
other Loan Documents are hereby in all respects ratified and confirmed.
6. REPRESENTATIONS AND WARRANTIES. The Borrower hereby represents and
warrants to the Banks that it is not aware of any Incipient Default or Event of
Default other than those expressly waived pursuant hereto or otherwise
disclosed in writing to the Agent. The Borrower acknowledges that the Banks are
relying on the foregoing representation and warranty in making their decision
to enter into this Amendment.
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7. OUTSTANDING INDEBTEDNESS; WAIVER OF CLAIMS. The Borrower hereby
acknowledges and agrees that as of October 13, 1999 the outstanding principal
amount of the Loan is $102,733,072.26 and that such principal amount is payable
pursuant to the Credit Agreement without defense, offset, withholding,
counterclaim or deduction of any kind. The Borrower hereby further acknowledges
that it has no Claims (as hereinafter defined) against the Agent, the Issuing
Bank or the Banks and their respective employees, agents, representatives,
consultants, attorneys, fiduciaries, servants, officers, directors, partners,
predecessors, subsidiary corporations, parent corporations and related
corporate divisions and their respective successors and assigns (all of the
foregoing being the "Indemnified Persons") and hereby waives, releases, remises
and forever discharges Agent, the Issuing Bank, each Bank and each other
Indemnified Person from any and all Claims of any and every character, known or
unknown, direct and/or indirect, at law or in equity, of whatsoever kind or
nature, whether heretofore or hereafter arising, for or because of any matter
or things done, omitted or suffered to be done by any Indemnified Person prior
to and including the date hereof, and in any way directly or indirectly arising
out of or in any way connected to the Credit Agreement or any other Loan
Document. For purposes hereof, "Claims" shall mean all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits or claims
which may be instituted or asserted against or incurred by such Indemnified
Person as the result of credit having been extended under the Credit Agreement
or any other Loan Document or otherwise arising in connection with the
transactions contemplated thereunder.
8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
9. EFFECTIVENESS. This Amendment shall become effective as of the date
(the "Amendment Effective Date") upon which the Agent confirms to the Borrower
that each of the following conditions, in the judgment of the Agent, has been
satisfied in full:
(a) The Agent shall have received nine (9) original copies of this
Amendment duly executed and delivered by the Borrower, the Agent, the Issuing
Bank and the Majority Banks and acknowledged by the Guarantors listed on the
signatures pages hereto.
(b) The Loan Request submitted to the Agent on September 27, 1999 shall
have been revised in a manner satisfactory to the Agent and resubmitted to the
Agent.
10. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which shall be an original with the same effect as if the
signatures thereto and hereto were upon the same instrument.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, each of the parties hereto has executed this
Amendment as of date and year first above written.
NEW AMERICAN HEALTHCARE CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: SVP-CAO
TORONTO DOMINION (TEXAS), INC.,
As Agent and a Bank
By:
------------------------------------
Name:
Title:
THE TORONTO-DOMINION BANK,
as Issuing Bank
By:
------------------------------------
Name:
Title:
BANK OF AMERICA, N.A. f/k/a
NATIONSBANK, N.A.
By:
------------------------------------
Name:
Title:
[SIGNATURES CONTINUED ON NEXT PAGE]
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FIRST UNION NATIONAL BANK
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: SENIOR VICE PRESIDENT
FIRST AMERICAN NATIONAL BANK
By:
------------------------------------
Name:
Title:
NATIONAL CITY BANK OF KENTUCKY
By:
------------------------------------
Name:
Title:
BANK ONE, N.A.
By:
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Name:
Title:
AMSOUTH BANK
By:
------------------------------------
Name:
Title:
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The undersigned Guarantors hereby (i) acknowledge
and consent to the amendments to the Credit
Agreement effected by this Amendment and (ii)
confirm and agree that their obligations under their
respective Guaranties shall continue without any diminution
thereof and shall remain in full force and effect on and after
the effectiveness of this Amendment.
NAHC OF MISSOURI, INC.
NAHC OF TEXAS, INC.
NAHC II OF TEXAS, INC.
NAHC FINANCIAL, INC.
NAHC OF IOWA, INC.
NAHC OF OREGON, INC.
NAHC II OF OREGON, INC.
NAHC III OF OREGON, INC.
NAHC OF WYOMING, INC.
NAHC COMPANY, INC.
NAHC GEORGIA HOLDINGS, INC.
NAHC OF MISSISSIPPI, INC.
NAHC OF WASHINGTON, INC.
MEMORIAL HOSPITAL OF ADEL, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: VP-Secretary
NAHC LIMITED PARTNERSHIP
By: New American Healthcare Corporation,
Its General Partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
Title: SVP-CAO
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WELSH, CARSON, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ VII, L.P.
By: WCAS VII Partners,
as General Partner
By: /s/
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Name:
Title: General Partner
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