EXHIBIT 10.27
THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS THIRD AMENDMENT (this "Amendment"), made this ____ day of June,
2002, is by and among U.S. Bank National Association (the "Bank") the successor
to Bank of America, N.A., the successor to NationsBank, N.A. ("Bank of
America"), ARC of Bellingham, L.P., a Tennessee limited partnership (the
"Borrower") and Symbion Ambulatory Resource Centres, Inc., a Tennessee
corporation and the successor to Ambulatory Resource Centres, Inc. (the
"Guarantor").
RECITALS
Bank of America has previously made a loan to the Borrower, an
Affiliate of Guarantor, pursuant to a Loan and Security Agreement dated
September 7, 1999 (as amended from time to time, the "Loan Agreement").
Capitalized terms not otherwise defined in this Amendment shall have the
meaning provided in the Loan Agreement. The Loan Agreement has been amended
pursuant to (i) a First Amendment to Loan and Security Agreement dated April
12, 2000 among Bank of America, Borrower and Guarantor, and (ii) a Second
Amendment to Loan and Security Agreement dated March 29, 2001 among Bank of
America, Borrower and Guarantor. At the request of Borrower, Bank has acquired
all of Bank of America's interest in the indebtedness extended pursuant to the
Loan Agreement, conditioned upon the execution of this Amendment and compliance
with the terms hereof.
NOW, THEREFORE, the parties to this Amendment hereby agree as follows:
Article I. Amendment to Loan Agreement. The parties hereto amend the Loan
Agreement as follows:
Section 1.1 The definition of "LOAN TERMINATION DATE" in the Loan
Agreement is hereby deleted in its entirety and replaced with the following:
`"LOAN TERMINATION DATE" means the earlier of (i) April 2,
2003 or (ii) the financial closing of the credit facility
substantially as described in the term sheet posted by Banc of America
Securities LLC as of May 16, 2002 on XxxxxXxxxx.xxx.'
Section 1.2 The following definitions are hereby added to the Loan
Agreement:
`"EBITDAR" means, for any Person and for any period of
determination, the Net Income for such period plus (A) Interest
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Expense for such period deducted in the determination of Net Income,
(B) federal and state taxes for such period deducted in the
determination of Net Income, (C) depreciation deducted in the
determination of Net Income, (D) amortization deducted in the
determination of Net Income, (E) non-cash or non-recurring charges for
such period deducted in the determination of Net Income, and (F)
Rental Expense for such period deducted in the determination of Net
Income, all as determined in accordance with generally accepted
accounting principles consistently applied.
"FIXED CHARGE COVERAGE RATIO" means the ratio of (A) the sum
of EBITDAR, minus maintenance Capital Expenditures, minus cash
payments of federal and state taxes to (B) the sum of Interest
Expense, plus Rental Expense, plus scheduled principal payments on
Indebtedness, measured on a trailing four quarters basis.
"TWELVE MONTH PRO-FORMA EFFECT" means, in making any
calculation to determine if Symbion is in compliance with Subparagraph
6.15(g) of the Loan Agreement, that the calculation will be made
assuming that (a) any Acquisition made during the twelve-month period
ending on the date of determination (the "Reference Period"), and (b)
any Indebtedness associated with (a) incurred during the Reference
Period or to be incurred as of the date of determination, were made or
incurred on the first day of the Reference Period. Any funds to be
used in consummating an Acquisition will be assumed to have been used
for that purpose as of the first day of the Reference Period. If
EBITDA for the Reference Period associated with the assets acquired or
to be acquired in any Permitted Acquisition is greater than $0, such
EBITDA will be included in the calculation of EBITDA, and any
Indebtedness to be incurred in connection with the consummation of any
Acquisition will be assumed to have been incurred on the first day of
the Reference Period. Interest Expense with respect to such
Indebtedness assumed to have been incurred on the first day of the
Reference Period which bears interest at a floating rate shall be
calculated at the current rate under the agreement governing such
Indebtedness. Any Interest Expense incurred during the Reference
Period which was or is to be refinanced with the proceeds of
Indebtedness assumed to have been incurred as of the first day of the
Reference Period will be excluded from the calculation for which a
Pro-Forma Effect is being given.'
Section 1.3 Section 2.2(a) of the Loan Agreement is hereby deleted in
its entirety and replaced with the following:
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"(a) Interest shall be charged and paid on the Loan from the
date of the initial advance until the Loan is paid at a rate equal to
the LIBO Rate plus three hundred fifty basis points (3.5%), to be
adjusted at the beginning of each Interest Period."
Section 1.4 The following is hereby added to the Loan Agreement as
Section 6.15(g):
"(g) At the end of each Quarterly Period, the Fixed Charge
Coverage Ratio of Symbion, calculated on a consolidated basis and
giving Twelve-Month Pro-Forma Effect to any Acquisition made and any
Funded Debt incurred in connection therewith, shall be greater than
1.25 to 1.00."
Article II. General.
Section 2.1 Loan Agreement. Except as amended hereby, the provisions
of the Loan Agreement shall remain in full force and effect. References in the
Loan Agreement and the other Loan Documents shall be references to the Loan
Agreement as amended by this Amendment.
Section 2.2 Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Tennessee without
reference to its choice of law rules.
Section 2.3 Execution in Counterparts. This Amendment may be executed
in one or more counterparts, each of which shall be considered an original
instrument, but all of which shall be considered one and the same agreement,
and shall become binding when one or more counterparts have been signed by each
of the parties and delivered to each of the parties.
Section 2.4 Representations. Borrower hereby makes the following
representations and warranties:
(a) as of the date hereof, Borrower has no defense against
payment of any or all of the Obligations;
(b) as of the date hereof, no Event of Default or Unmatured
Default has occurred or is continuing (after giving effect to this
Amendment).
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first above written.
BANK: BORROWER:
U.S BANK NATIONAL ASSOCIATION ARC OF BELLINGHAM, L.P.,
a Tennessee Limited Partnership
By: Ambulatory Resource
Centres of
Washington, Inc., its General
Partner
BY:
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GUARANTOR:
SYMBION AMBULATORY
RESOURCE CENTRES, INC.
BY:
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SYMBION:
The undersigned guarantor of the indebtedness extended pursuant to the Loan
Agreement hereby acknowledges the foregoing amendment.
SYMBION, INC.
BY:
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TITLE:
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