EXHIBIT 10.18.3
================================================================================
RENAL CARE GROUP, INC.
as Borrower
--------------------------------------------------------------------------------
SECOND AMENDED AND RESTATED
LOAN AGREEMENT
(MULTI-YEAR FACILITY)
Dated as of July 1, 2002
--------------------------------------------------------------------------------
THE SEVERAL LENDERS FROM
TIME TO TIME PARTY HERETO
BANK OF AMERICA, N.A.
as Agent
and
SUNTRUST BANK,
as Syndication Agent
BANC OF AMERICA SECURITIES LLC,
Sole Lead Arranger and Sole Book Manager
================================================================================
TABLE OF CONTENTS
I. DEFINITIONS..............................................................................................1
1.1 Terms Defined in This Agreement.................................................................1
1.2 Terms Generally................................................................................23
II. CREDIT FACILITIES.......................................................................................24
2.1 Amount of Revolving Credit Loans...............................................................24
2.2 Use of Proceeds of Revolving Credit Loans......................................................24
2.3 Revolving Credit Notes.........................................................................24
2.4 Separate Commitments of the Lenders............................................................25
2.5 Advances of Loans..............................................................................25
2.6 Interest.......................................................................................27
2.7 Alternate Rate of Interest if LIBOR Unavailable................................................28
2.8 Change in Circumstances........................................................................29
2.9 Change in Legality of LIBOR Loans..............................................................30
2.10 Principal Repayment............................................................................31
2.11 Prepayment of LIBOR Loans......................................................................31
2.12 Prepayment of Base Rate Loans..................................................................32
2.13 Mandatory Prepayments..........................................................................32
2.14 Reduction of Commitment........................................................................34
2.15 Fees...........................................................................................34
2.16 Swingline Loans................................................................................35
2.17 Letter of Credit Subfacility...................................................................38
2.18 Payments.......................................................................................43
III. CONDITIONS PRECEDENT....................................................................................44
3.1 Closing Conditions.............................................................................44
3.2 Conditions to all Loans and Issuances..........................................................47
IV. REPRESENTATIONS AND WARRANTIES..........................................................................48
4.1 Capacity.......................................................................................48
4.2 Authorization..................................................................................48
4.3 Binding Obligations............................................................................48
4.4 No Conflicting Law or Agreement................................................................48
4.5 No Consent Required............................................................................49
4.6 Financial Statements...........................................................................49
4.7 Fiscal Year....................................................................................49
4.8 Litigation.....................................................................................49
4.9 Taxes; Governmental Charges....................................................................49
4.10 Title to Properties............................................................................50
4.11 No Default.....................................................................................50
4.12 Casualties; Taking of Properties...............................................................50
4.13 Compliance with Laws...........................................................................50
4.14 Compliance with Fraud and Abuse Laws...........................................................50
4.15 ERISA..........................................................................................51
4.16 Full Disclosure of Material Facts..............................................................51
4.17 Investment Company Act.........................................................................51
i
4.18 Holding Company................................................................................51
4.19 Solvency.......................................................................................51
4.20 Subsidiaries...................................................................................51
4.21 Ownership of Patents, Licenses, Etc............................................................52
4.22 Environmental Compliance.......................................................................52
4.23 Labor Matters..................................................................................52
4.24 OSHA Compliance................................................................................52
4.25 Regulations T, U and X.........................................................................53
4.26 Inter-Company Notes............................................................................53
V. AFFIRMATIVE COVENANTS...................................................................................53
5.1 Payment of Obligations.........................................................................53
5.2 Maintenance of Existence.......................................................................53
5.3 Financial Statements and Reports...............................................................54
5.4 Taxes and Other Encumbrances...................................................................56
5.5 Payment of Debts...............................................................................56
5.6 Compliance with Laws...........................................................................56
5.7 Maintenance of Property........................................................................56
5.8 Compliance with Contractual Obligations........................................................57
5.9 Further Assurances.............................................................................57
5.10 Security Interest; Setoff......................................................................57
5.11 Insurance......................................................................................57
5.12 Accounts and Records...........................................................................58
5.13 Official Records...............................................................................58
5.14 Banking Relationships..........................................................................58
5.15 Right of Inspection............................................................................58
5.16 ERISA Information and Compliance...............................................................59
5.17 Indemnity; Expenses............................................................................59
5.18 Assistance in Litigation.......................................................................60
5.19 Name Changes...................................................................................60
5.20 Estoppel Letters...............................................................................61
5.21 Environmental Matters..........................................................................61
5.22 Opinions of Counsel............................................................................62
5.23 Additional Credit Parties......................................................................62
VI. NEGATIVE COVENANTS......................................................................................63
6.1 Debt...........................................................................................63
6.2 Encumbrances...................................................................................64
6.3 Investments....................................................................................64
6.4 Change of Control..............................................................................65
6.5 Nature of Business.............................................................................65
6.6 Consolidation, Mergers, Etc....................................................................65
6.7 Asset Dispositions.............................................................................65
6.8 Inconsistent Agreements........................................................................66
6.9 Fictitious Names...............................................................................66
6.10 Adverse Action With Respect to Plans...........................................................66
6.11 Transactions With Affiliates...................................................................66
6.12 Constituent Document Amendments................................................................66
6.13 Adverse Transactions...........................................................................66
6.14 Accounting Changes.............................................................................66
6.15 Restricted Payments............................................................................67
6.16 Limitation on Restricted Actions...............................................................67
6.17 Sale Leasebacks................................................................................67
6.18 No Further Negative Pledges....................................................................67
VII. FINANCIAL COVENANTS.....................................................................................68
7.1 Consolidated Net Worth.........................................................................68
7.2 Leverage Ratio.................................................................................68
7.3 Total Capitalization Ratio.....................................................................68
7.4 Fixed Charge Coverage..........................................................................68
VIII. EVENTS OF DEFAULT.......................................................................................68
8.1 Events of Default..............................................................................68
8.2 Remedies.......................................................................................71
IX. AGENCY PROVISIONS.......................................................................................72
9.1 Appointment and Authorization of Agent.........................................................72
9.2 Indemnification of Agent.......................................................................73
9.3 Credit Decision; Disclosure of Information by Agent............................................73
9.4 Notice of Default..............................................................................74
9.5 Funding of Advances Pursuant to Borrowing Notices..............................................74
9.6 Agent in its Individual Capacity...............................................................75
9.7 Successor Agent................................................................................76
9.8 Sharing of Payments, etc.......................................................................76
9.9 Payments Between the Agent and the Lenders.....................................................77
9.10 Assignments and Participations.................................................................78
9.11 Procedures for Notices and Approvals...........................................................81
9.12 Other Relationships With The Borrower..........................................................81
9.13 Taxes..........................................................................................81
9.14 Delegation of Duties...........................................................................83
9.15 Liability of Agent.............................................................................83
9.16 Reliance by Agent..............................................................................83
9.17 Other Agents; Lead Managers....................................................................84
X. GENERAL PROVISIONS......................................................................................84
10.1 Notices........................................................................................84
10.2 Renewal, Extension, or Rearrangement...........................................................86
10.3 Counterparts...................................................................................86
10.4 Negotiated Document............................................................................86
10.5 Consent to Jurisdiction; Venue.................................................................86
10.6 Not Partners; No Third Party Beneficiaries.....................................................86
10.7 No Reliance on Lenders' Analysis...............................................................86
10.8 No Marshaling of Assets........................................................................87
10.9 Impairment of Collateral.......................................................................87
10.10 Business Days..................................................................................87
10.11 Standard of Care; Limitation of Damages........................................................87
10.12 Incorporation of Schedules.....................................................................87
10.13 Indulgence Not Waiver..........................................................................87
10.14 Cumulative Remedies............................................................................88
10.15 Amendment and Waivers..........................................................................88
10.16 Entire Agreement...............................................................................89
10.17 Severability...................................................................................89
10.18 Time of Essence................................................................................89
10.19 Governing Law..................................................................................89
10.20 Captions Not Controlling.......................................................................90
10.21 Waiver of Right to Jury Trial..................................................................90
10.22 Facsimile Signatures...........................................................................90
10.23 Right of Set-Off; Adjustments..................................................................90
10.24 Confidentiality................................................................................90
10.25 No Waiver; Remedies Cumulative.................................................................91
10.26 Survival.......................................................................................91
EXHIBITS
1.3 Form of Swingline Note
2.3 Form of Revolving Credit Note
2.5.1(b) Form of Borrowing and Conversion Notices
3.1.1(d) Form of Guaranty Agreement
3.1.1(e) Form of Security Agreement
3.1.1(f) Form of Collateral Assignment
5.23 Form of Joinder Agreement
9.10 Form of Assignment and Acceptance
SCHEDULES
1.1(a) Commitments
1.1(b) Existing Letters of Credit
3.1.1 Opinion Subsidiaries
4.20 Subsidiaries
4.26 Inter-Company Notes
5.11 Insurance
6.1.7 Existing Debt
6.3 Existing Investments
6.17 Sale/Leaseback Transactions
SECOND AMENDED AND RESTATED LOAN AGREEMENT
This Second Amended and Restated Loan Agreement is entered into as of
the 1st day of July, 2002, by and among RENAL CARE GROUP, INC., a Delaware
corporation (the "Borrower"), the Lenders (as defined herein) from time to time
party hereto and BANK OF AMERICA, N.A., in its capacity as the Agent for the
Lenders (in such capacity, the "Agent").
RECITALS
WHEREAS, Bank of America, N.A. (formerly NationsBank of Tennessee,
N.A.) and the Borrower previously entered into that certain Loan Agreement dated
as of May 30, 1996, (as amended or modified from time to time, the "1996 Loan
Agreement"), providing for the extension of a credit facility to the Borrower
and certain other Subsidiaries of the Borrower; and
WHEREAS, the Agent, the Lenders and the Borrower amended and restated
the 1996 Loan Agreement to, among other things, increase the credit facility
provided for in the 1996 Loan Agreement pursuant to that certain First Amended
and Restated Loan Agreement dated as of August 4, 1997 (as amended or modified
from time to time, the "1997 Loan Agreement"); and
WHEREAS, the Borrower has requested that the Lenders increase and
otherwise amend the credit facility provided pursuant to the 1997 Loan
Agreement; and
WHEREAS, the Lenders and the Agent have agreed to amend and restate the
terms and conditions of the 1997 Loan Agreement on the terms and conditions
hereinafter set forth in accordance with the request of the Borrower;
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
I. DEFINITIONS
1.1 TERMS DEFINED IN THIS AGREEMENT.
As used below in this Agreement, the following capitalized terms shall
have the following meanings, unless the context expressly requires otherwise:
"364-DAY COMMITMENTS" means the total amount of all commitments of
those lenders party to the 364-Day Loan Agreement in effect from time to time.
"364-DAY LENDERS" means the lenders that are from time to time party to
the 364-Day Loan Agreement.
"364-DAY LOAN AGREEMENT" means that certain Loan Agreement (364-Day
Facility) dated as of the Closing Date among the Borrower, Bank of America,
N.A., as agent and the
lenders party thereto, as amended, modified, supplemented, extended, renewed or
restated from time to time.
"364-DAY LOANS" means those loans advanced under the 364-Day Loan
Agreement.
"364-DAY OBLIGATIONS" means the obligations of the Borrower to the
lenders to repay the 364-Day Loans, and all other obligations of the Borrower
and the Borrower Entities to the lenders and the agent under the 364-Day Loan
Agreement and all other documents and agreements related thereto.
"ACCOUNT AGREEMENT" has the meaning assigned in Section 2.16.4 of this
Agreement.
"ACQUIRED PRACTICE" means each of (i) a Practice acquired by a Borrower
Entity before the Closing Date, and (ii) a Practice acquired by a Borrower
Entity after the Closing Date in a Permitted Acquisition.
"ADDITIONAL CREDIT PARTY" means each Person that becomes a Guarantor
after the Closing Date by execution of a Joinder Agreement.
"AFFILIATE" means, with respect to any Person, any other Person (i)
directly or indirectly controlling or controlled by or under direct or indirect
common control with such Person or (ii) directly or indirectly owning or holding
five percent (5%) or more of the equity interest in such Person. For purposes of
this definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise,
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGENT" has the meaning assigned to such term in the heading hereof,
together with any successors and assigns.
"AGENT-RELATED PERSON" means the Agent (including any successor Agent),
together with its Affiliates (including in the case of Bank of America in its
capacity as Agent, the Arranger), and the officers, directors, employees, agents
and attorneys-in-fact of such Persons and Affiliates.
"AGREEMENT" means this Second Amended and Restated Loan Agreement
(including all schedules and exhibits hereto), as the same may be amended from
time to time.
"ALTERNATE BASE RATE" means the greater of (i) the Federal Funds Rate
plus one-half percent (1/2%), and (ii) the Prime Rate, in each case as such rate
may change from time to time.
"APPLICABLE COMMITMENT FEE," "APPLICABLE LIBO RATE MARGIN", "APPLICABLE
BASE RATE MARGIN" and "APPLICABLE LETTER OF CREDIT FEE" mean, for purposes of
calculating the applicable interest rate for any day for any Loan advanced
hereunder, the commitment fee respecting the Revolving Credit Loans and the
applicable rate of the Letter of Credit Fee for any day, (i) until the Pricing
Tier Determination Date determined by the delivery of the Borrower's
2
financial statements for the fiscal quarter ending June 30, 2002, the rates
identified as Tier 1 in the table below, and (ii) thereafter, the rates
established by the Agent from time to time upon each subsequent Pricing Tier
Determination Date pursuant to the percentage rates per annum set forth opposite
the appropriate test in the pricing grid below (ratio values shall be rounded to
the nearest one-hundredth, with any value of .005 rounded upward):
-------------------------------------------------------------------------------------------------------------------
BASE RATE LIBO RATE COMMITMENT LETTER OF CREDIT
LEVERAGE RATIO MARGIN MARGIN FEE FEE
-------------------------------------------------------------------------------------------------------------------
Tier 1
Less than or equal to 1.0 0% 1.0% 0.30% 1.0%
-------------------------------------------------------------------------------------------------------------------
Tier 2
Greater than 1.0 and
less than or equal to 1.5 0% 1.25% 0.30% 1.25%
-------------------------------------------------------------------------------------------------------------------
Tier 3
Greater than 1.5 and
less than or equal to 2.0 0% 1.50% 0.375% 1.50%
-------------------------------------------------------------------------------------------------------------------
Tier 4
Greater than 2.0 0.25% 1.75% 0.375% 1.75%
-------------------------------------------------------------------------------------------------------------------
The Leverage Ratio shall be established by the Agent on each Pricing Tier
Determination Date on the basis of the then current consolidated quarterly
financial statements of and schedules prepared by the Borrower delivered to the
Agent pursuant to this Agreement; provided, however, that, if the Borrower fails
to provide the financial statements and certificates required by Section 5.3 for
the last day of the most recently ended fiscal quarter preceding the Pricing
Tier Determination Date, the Applicable Commitment Fee, the Applicable LIBO Rate
Margin, the Applicable Base Rate Margin and the Applicable Letter of Credit Fee
shall be based on Tier 4 in the table above until such time as the appropriate
financial statements and certificates are provided, whereupon the rates shall be
determined as provided above. Additionally, if the Borrower's financial
statements are determined to have been in error in a manner that affects the
Leverage Ratio sufficiently that, in retrospect, a higher tier should have
applied to any period, the Borrower shall pay to the Agent for the account of
the Lenders, upon demand, the additional amount of interest that would have been
paid had the financial statements been correctly stated.
"APPLICABLE LENDING OFFICE" means, for each Lender, the office of such
Lender (or an Affiliate of such Lender) as such Lender may from time to time
specify to the Agent and the Borrower by written notice as the office by which
its LIBOR Loans are made and maintained.
"APPROVED FUND" means any Fund that is administered or managed by (a) a
Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an
entity that administers or manages a Lender.
"ARRANGER" means Banc of America Securities LLC, in its capacity as
sole lead arranger and sole book manager.
"ASSET DISPOSITION" means the disposition of any or all of the assets
(including without limitation the Capital Stock of a Subsidiary owned by a
Borrower Entity) of any Borrower Entity
3
whether by sale, lease, transfer or otherwise other than any such sale or
disposition permitted by Section 6.7.
"ASSIGNMENT AND ACCEPTANCE" means an Assignment and Acceptance in
substantially the form of Exhibit 9.10.
"BANK OF AMERICA" means Bank of America, N.A. and its successors.
"BANKING DAY" means a Business Day, subject to the following additional
convention. As to notices or payments received on a Business Day at or before
11:00 a.m. Charlotte, North Carolina time, the Banking Day shall correspond to
the Business Day of receipt. As to notices or payments received on a Business
Day after 11:00 a.m. Charlotte, North Carolina time, the Banking Day of receipt
shall be deemed to be the next following Business Day.
"BANKRUPTCY CODE" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
"BANKRUPTCY EVENT" means, with respect to any Person, the occurrence of
any of the following with respect to such Person: (i) a court or governmental
agency having jurisdiction in the premises shall enter a decree or order for
relief in respect of such Person in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of its Property
or ordering the winding up or liquidation of its affairs; or (ii) there shall be
commenced against such Person an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or any
case, proceeding or other action for the appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator (or similar official) of such Person
or for any substantial part of its Property or for the winding up or liquidation
of its affairs, and such involuntary case or other case, proceeding or other
action shall remain undismissed, undischarged or unbonded for a period of sixty
(60) consecutive days; or (iii) such Person shall commence a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, or consent to the entry of an order for relief in an
involuntary case under any such law, or consent to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of its Property
or make any general assignment for the benefit of creditors; or (iv) such Person
shall be unable to, or shall admit in writing its inability to, pay its debts
generally as they become due.
"BASE RATE LOAN" means a Loan for which the Borrower has elected the
application of an interest rate based upon the Alternate Base Rate.
"BORROWER" means Renal Care Group, Inc., a Delaware corporation,
together with its successors and permitted assigns. This definition does not
abrogate the requirement set forth below restricting the Borrower's ability to
assign any rights under this Agreement.
"BORROWER'S LINE OF BUSINESS" means (a) the business of owning,
operating and managing dialysis clinics and nephrology physician practices and
providing ancillary services
4
relating to the needs of patients with end stage renal disease and (b) the
business of owning, operating and managing clinics and practices in other
medical fields (including non-dialysis outpatient services); provided, that the
revenues for any period attributable to such other medical fields (including
non-dialysis outpatient services) shall not exceed 5% of the consolidated
revenues of the Borrower Entities for such period.
"BORROWER ENTITIES" means the Borrower and all its Subsidiaries in
existence from time to time, and "BORROWER ENTITY" means any one of them.
"BORROWING NOTICE" has the meaning assigned in Section 2.5.l(b) hereof.
"BUSINESS DAY" means any day on which the Agent and national banks
located in Charlotte, North Carolina are open for the conduct of ordinary
business; provided however, that when used in connection with determining the
LIBO Rate, the term "Business Day" shall exclude any day on which banks are not
open for dealings in U.S. Dollar deposits in the London Interbank Market.
"CAPITAL EXPENDITURES" means, for any period, all capital expenditures
of the Borrower Entities on a consolidated basis for such period, as determined
in accordance with GAAP.
"CAPITAL LEASE" means a lease that would be characterized as a financed
sale or purchase under GAAP.
"CAPITAL STOCK" means (i) in the case of a corporation, capital stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other equivalents (however designated) of
capital stock, (iii) in the case of a partnership, partnership interests
(whether general or limited), (iv) in the case of a limited liability company,
membership interests and (v) any other interest or participation that confers on
a Person the right to receive a share of the profits and losses of, or
distributions of assets of, the issuing Person.
"CASH CONSIDERATION" means all noncontingent obligations to pay cash
(whether payable over time or due at closing) as consideration in connection
with a Permitted Acquisition, whether characterized as price, deferred price,
consulting fee (if regarded as part of the purchase price rather than for bona
fide services to be provided independent of the purchase) or otherwise, plus the
maximum amount of contingent consideration (including, but not limited to,
"earnout notes") that could arise during the first year following the
acquisition as a result of the acquisition and all debt assumed in connection
with the acquisition, plus the amount of the Borrower's obligations to
repurchase its Capital Stock in connection with such Permitted Acquisition,
calculated as though the affected Capital Stock were repurchased at the stock
price in effect on the date of the closing of the Permitted Acquisition.
"CHANGE OF CONTROL" means the occurrence of any of the following
events: (i) any Person or two or more Persons acting in concert acquiring
beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as amended),
directly or indirectly, of securities of the Borrower (or other securities
convertible into such securities) representing 30% or more of the combined
voting
5
power of all securities thereof entitled to vote in the election of directors;
or (ii) during any period of up to 24 consecutive months, individuals who at the
beginning of such 24-month period were directors of the Borrower ceasing for any
reason to constitute a majority of the Board of Directors thereof unless the
Persons replacing such individuals were nominated by the Board of Directors of
the Borrower; or (iii) any Person or two or more Persons acting in concert
acquiring by contract or otherwise, or entering into a contract or arrangement
which upon consummation will result in the acquisition of, or control over,
securities of the Borrower (or other securities convertible into such
securities) representing 30% or more of the combined voting power of all
securities of the Borrower entitled to vote in the election of directors.
"CLOSING DATE" means the date of this Agreement.
"CMLTD" means scheduled maturities of long-term Debt (including Capital
Leases) arising for the 12 months following the date of determination.
"COLLATERAL" means all Property now or hereafter securing the
Obligations.
"COLLATERAL AGENT" means Bank of America, in its capacity as collateral
agent for the Lenders and the 364-Day Lenders under the Security Agreement and
the Collateral Assignment.
"COLLATERAL ASSIGNMENT" means that certain Amended and Restated
Collateral Assignment of Promissory Notes dated as of the Closing Date in the
form of Exhibit 3.1.1(f) executed by the Credit Parties and the Collateral
Agent, as amended, modified, restated or supplemented from time to time.
"COMMITMENT" means, (a) as to any Lender, the obligation of such Lender
to make Revolving Credit Loans in accordance with Article II hereof in an
aggregate principal amount at any time outstanding of up to such Lender's
Commitment Percentage of the Total Commitments, as such amount may be reduced or
modified from time to time in accordance with the terms hereof, (b) as to all
the Lenders, the aggregate Commitment of all Lenders to make Revolving Credit
Loans in accordance with Article II hereof, as such amount may be reduced or
modified from time to time pursuant to the terms hereof and (c) as to the
Issuing Lender, the LOC Commitment. The aggregate Commitments of all Lenders on
the Closing Date shall be One Hundred Million Dollars ($100,000,000). The
Borrower may also reduce the amount of the Commitments in accordance with
Section 2.14 of this Agreement; provided, however, the Borrower may not increase
the amount of the Commitments in any amount after such a reduction has occurred.
"COMMITMENT PERCENTAGE" means, for any Lender, the percentage
identified as its Commitment Percentage on Schedule 1.1(a) hereto, as such
percentage may be modified in connection with any assignment made in accordance
with the provisions of Section 9.10.
"CONSOLIDATED EBITDA" means, as of any date for the four fiscal quarter
period ending on such date with respect to the Borrower Entities on a
consolidated basis, the sum of (i) Consolidated Net Income plus (ii) an amount
which, in the determination of Consolidated Net Income, has been deducted for
interest expense, income, value added and similar taxes and
6
depreciation and amortization expense, as determined in accordance with GAAP,
(iii) plus any noncash and nonrecurring charges, (iv) plus the amount of the
deduction from Consolidated Net Income taken to reflect income attributed to
minority interests, less (v) the amount, if any, by which the contribution to
Consolidated EBITDA by Non-Guarantor Subsidiaries and Permitted Equity
Investments in the aggregate would exceed twenty percent (20%) of Consolidated
EBITDA.
"CONSOLIDATED NET INCOME" means, as of any date with respect to the
Borrower Entities on a consolidated basis, net income (excluding extraordinary
items) after interest expense, income, value added and similar taxes and
depreciation and amortization, all as determined in accordance with GAAP.
"CONSOLIDATED NET WORTH" means shareholders' equity of the Borrower
Entities, determined on a consolidated basis according to GAAP.
"CREDIT PARTIES" means the collective reference to the Borrower and the
Guarantors, and "CREDIT PARTY" means any one of them.
"DEBT" means, with respect to any Person, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, or upon
which interest payments are customarily made, (c) all obligations of such Person
under conditional sale or other title retention agreements relating to Property
purchased by such Person (other than customary reservations or retentions of
title under agreements with suppliers entered into in the ordinary course of
business), (d) all obligations of such Person issued or assumed as the deferred
purchase price of Property or services purchased by such Person (other than
trade debt incurred in the ordinary course of business and due within six months
of the incurrence thereof) which would appear as liabilities on a balance sheet
of such Person (including earnout obligations), (e) all obligations of such
Person under take-or-pay or similar arrangements or under commodities
agreements, (f) the implied principal component of all obligations of such
Person under Capital Leases, (g) all obligations of such Person under Hedging
Agreements, (h) the maximum amount of all performance and standby letters of
credit issued or bankers' acceptances facilities created for the account of such
Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (i) all preferred Capital Stock issued by such Person and which
by the terms thereof could be (at the request of the holders thereof or
otherwise) subject to mandatory sinking fund payments, redemption or other
acceleration at any time prior to the Termination Date, (j) the principal
portion of all obligations of such Person under Synthetic Leases, (k) all
obligations of such Person to repurchase any securities issued by such Person at
any time which repurchase obligations are related to the issuance thereof,
including, without limitation, obligations commonly known as residual equity
appreciation potential shares, (l) the aggregate amount of uncollected accounts
receivable of such Person subject at such time to a sale of receivables (or
similar transaction) to the extent such transaction is effected with recourse to
such Person (whether or not such transaction would be reflected on the balance
sheet of such Person in accordance with GAAP), (m) all Debt of others secured by
(or for which the holder of such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien on, or payable out of the proceeds of
production from, Property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (n) all Guaranty Obligations of
7
such Person with respect to Debt of another Person and (o) the Debt of any
partnership or unincorporated joint venture in which such Person is a general
partner or a joint venturer to the extent such Debt is recourse to such Person.
"DEBT ISSUANCE" means the issuance of any Debt for borrowed money by
any Borrower Entity other than Debt permitted to be incurred pursuant to Section
6.1.
"DEFAULT" means any event, act or condition that, but for the giving of
any required notice by the Agent and/or the passing of time, would be an Event
of Default hereunder.
"DEFAULT RATE" means the lesser of (i) two percent (2%) over the
Alternate Base Rate plus the Applicable Base Rate Margin in effect from time to
time, or (ii) the Maximum Lawful Amount.
"DOLLARS" and "$" means dollars in lawful currency of the United
States.
"DOMESTIC SUBSIDIARY" means any direct or indirect Subsidiary of the
Borrower which is incorporated or organized under the laws of any State of the
United States or the District of Columbia.
"ELIGIBLE ASSIGNEE" means (a) a Lender; (b) an Affiliate of a Lender;
(c) an Approved Fund; and (d) any other Person (other than a natural Person)
approved by the Agent and, unless (x) such Person is taking delivery of an
assignment in connection with physical settlement of a credit derivatives
transaction or (y) an Event of Default has occurred and is continuing, the
Borrower (each such approval not to be unreasonably withheld or delayed).
"ENCUMBRANCE" means any interest in or restriction upon Property in
favor of one not the owner thereof, whether voluntary or involuntary, including,
but not limited to, (i) the lien or security interest arising from a deed of
trust, mortgage, pledge, security agreement, conditional sale, Capital Lease,
consignment, or bailment for security purposes (including any agreement to give
any of the foregoing), (ii) reservations, exceptions, encroachments, easements,
rights-of-way, covenants, conditions, restrictions, leases, and other such title
encumbrances and (iii) any financing statement authorized by a Borrower Entity
to be filed under the Uniform Commercial Code as adopted and in effect in the
relevant jurisdiction.
"ENVIRONMENTAL LAWS" means the Environmental Protection Act, the
Resource Conservation and Recovery Act of 1976, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, the Hazardous Materials
Transportation Act and any other federal, state or municipal law, rule or
regulation relating to air emissions, water discharge, noise emissions, solid or
liquid waste disposal, hazardous or toxic waste or materials, or other
environmental or health matters.
"EQUITY ISSUANCE" means any issuance by any Credit Party to any Person
which is not a Credit Party of (a) shares of its capital stock, (b) any shares
of its capital stock pursuant to the exercise of options or warrants or (c) any
shares of its capital stock pursuant to the conversion of any debt securities to
equity.
8
"ERISA" means the Employee Retirement Income Security Act of 1974, and
any successor statute thereto, as amended from time to time, including (unless
the context otherwise requires) any rules or regulations promulgated thereunder.
"ERISA AFFILIATE" means any Person who for purposes of Title IV of
ERISA is a member of the Borrower's controlled group, or under common control
with the Borrower, within the meaning of Section 414 of the IRC, the regulations
promulgated pursuant thereto and the published revenue rulings issued
thereunder.
"ERISA EVENT" means (i) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, unless the 30-day notice requirement with
respect thereto has been waived by the PBGC; (ii) the provision by the
administrator of any Plan of a notice of intent to terminate such Plan, pursuant
to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan
amendment referred to in Section 4041(e) of ERISA); (iii) the cessation of
operations at a facility in the circumstances described in Section 4068(f) of
ERISA; (iv) the withdrawal by the Borrower or an ERISA Affiliate from a Multiple
Employer Plan during a plan year for which it was a substantial employer, as
defined in Section 4001(a)(2) of ERISA; (v) the failure by the Borrower or any
ERISA Affiliate to make a material payment to a Plan required under Section
302(f)(1) of ERISA; (vi) the adoption of an amendment to a Plan requiring the
provision of initial or additional security to such Plan, pursuant to Section
307 of ERISA; or (vii) the institution by the PBGC of proceedings to terminate a
Plan, pursuant to Section 4042 of ERISA, or the occurrence of any event or
condition which might constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, a Plan.
"EVENT OF DEFAULT" means the occurrence of any of the events specified
in Section 8.1 hereof, as to which any requirement for notice or lapse of time
has been satisfied.
"EXISTING LETTERS OF CREDIT" means the letters of credit described by
date of issuance, letter of credit number, undrawn amount, name of beneficiary
and date of expiry on Schedule 1.1(b) hereto.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards to the nearest 1/100 of 1%) equal to the weighted average of the rates
on overnight Federal funds transactions with members of the Federal Reserve
System arranged by Federal funds brokers on such day, as published by the
Federal Reserve Bank on the Business Day next succeeding such day; provided that
(a) 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 (b) 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 charged to Bank of America on such day on such
transactions as determined by the Agent.
"FINANCIAL STATEMENTS" means the audited consolidated balance sheet,
income statement and statement of cash flows for the Borrower Entities for the
fiscal year ending December 31, 2001.
9
"FIXED CHARGE COVERAGE RATIO" means, as of the end of each fiscal
quarter of the Borrower Entities for the twelve month period ending on such
date, the ratio of (i) the sum of (a) Consolidated EBITDA for the applicable
period less (b) the aggregate of all federal, state, local and foreign income
taxes of the Borrower Entities on a consolidated basis for the applicable period
plus (c) rent and lease expense of the Borrower Entities on a consolidated basis
for the applicable period less (d) the greater of (i) a charge of $500.00 per
dialysis station per fiscal quarter to allow for maintenance Capital
Expenditures and (ii) Capital Expenditures (other than any Permitted
Acquisitions) for the applicable period less (e) Permitted Dividends made to
Persons other than a Credit Party for the applicable period less (f) Permitted
Stock Purchases for the applicable period to (ii) the sum of (a) Interest
Expense for the applicable period plus (b) CMLTD (including implied amortization
calculated as one fifth (1/5th) of the aggregate of the outstanding principal
amount of (i) the Revolving Credit Loans as of the end of the applicable period
plus (ii) the Swingline Loans as of the end of the applicable period plus (iii)
the LOC Obligations as of the end of the applicable period) for the applicable
period plus (iv) 364-Day Loans as of the end of the applicable period plus (c)
rent and lease expense of the Borrower Entities on a consolidated basis for the
applicable period, as determined in accordance with GAAP.
"FOREIGN SUBSIDIARY" means any direct or indirect Subsidiary of the
Borrower which is not a Domestic Subsidiary.
"FRAUD AND ABUSE LAWS" means Section 1128B(b) of the Social Security
Act, 42 U.S.C. Section 1320a-7b(b) and Section 1877 of the Social Security Act,
42 U.S.C. Section 1877, as from time to time amended; any successor statute(s)
thereto: all rules and regulations promulgated thereunder; and any other Law
relating to the ownership of medical facilities by providers of medical services
or the referral of patients to medical facilities owned by providers of medical
services.
"FUND" means any Person (other than a natural Person) that is (or will
be) engaged in making, purchasing, holding or otherwise investing in commercial
loans and similar extensions of credit in the ordinary course of business.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.2.1.
"GOVERNMENTAL AUTHORITY" means any governmental or quasi-governmental
entity, court or tribunal including, without limitation, any department,
commission, board, bureau, agency, administration, service or other
instrumentality of any foreign or domestic governmental entity.
"GUARANTORS" means the collective reference to each of the Persons
which has executed the Guaranty Agreement and each Additional Credit Party which
has executed a Joinder Agreement, together with their successors and assigns,
and "GUARANTOR" means any one of them.
00
"XXXXXXXX XXXXXXXXX" means that certain Amended and Restated Joint and
Several Unconditional Guaranty dated as of the Closing Date in the form of
Exhibit 3.1.1(d) executed by the Guarantors whereby each becomes liable for the
Obligations, as amended, modified, restated or supplemented from time to time.
"GUARANTY OBLIGATIONS" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (i) to purchase any such Debt or any
Property constituting security therefor, (ii) to advance or provide funds or
other support for the payment or purchase of any such Debt or to maintain
working capital, solvency or other balance sheet condition of such other Person
(including without limitation keep well agreements, maintenance agreements,
comfort letters or similar agreements or arrangements) for the benefit of any
holder of Debt of such other Person, (iii) to lease or purchase Property,
securities or services primarily for the purpose of assuring the holder of such
Debt, or (iv) to otherwise assure or hold harmless the holder of such
Indebtedness against loss in respect thereof. The amount of any Guaranty
Obligation hereunder shall (subject to any limitations set forth therein) be
deemed to be an amount equal to the outstanding principal amount (or maximum
principal amount, if larger) of the Debt in respect of which such Guaranty
Obligation is made (or, if less, the maximum amount of such principal amounts
for which such Person may be liable under the terms of the instrument(s)
evidencing such Guaranty Obligation).
"HAZARDOUS SUBSTANCES" means those substances included from time to
time within the definition of hazardous substances, hazardous materials, toxic
substances, or solid waste under the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 as amended, 42 X.X.X.xx. 9601 et. seq.;
the Resource Conservation and Recovery Act of 1976, 42 X.X.X.xx. 6901 et. seq.;
the Hazardous Materials Transportation Act, 49 X.X.X.xx. 1801 et. seq.; the
Clean Water Act, 33 U.S.C. Section 1251 et. seq.; the Toxic Substances Control
Act, 15 U.S.C. Section 2601 et. seq., and in the regulations promulgated
pursuant to such acts and laws; and such other substances that are or become
regulated under any applicable local, state, or federal law or regulation
addressing environmental hazards.
"HEDGING AGREEMENTS" means any interest rate protection agreement or
foreign currency exchange agreement.
"INTER-COMPANY NOTES" means negotiable promissory notes evidencing the
loan obligations of the Borrower Entities to the Credit Parties.
"INTEREST EXPENSE" means expenses for all interest (including current
charges on Capital Leases and the implied interest component under Synthetic
Leases) and letter of credit fees and expenses for any interest rate swaps or
similar derivative contracts used for the management of interest expense of the
Borrower Entities on a consolidated basis, as determined in accordance with
GAAP.
11
"INTEREST PAYMENT DATE" means, (i) as to Base Rate Loans and Swingline
Loans, the last Business Day of each March, June, September and December and the
Maturity Date and (ii) as to LIBOR Loans, the last day of the Interest Period
applicable to such Loan, the date of repayment of principal of such Loan and the
Maturity Date and, in addition, in the case of a LIBOR Loan with an Interest
Period of six (6) months' duration, then also the date three months from the
beginning of the Interest Period.
"INTEREST PERIOD" means, as to LIBOR Loans, a period of one, two, three
or six months' duration, as the Borrower may elect, commencing, in each case, on
the date of the borrowing (including continuations and conversions thereof);
provided, however, (a) if any Interest Period would end on a day which is not a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day (except that where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business Day), (b) no
Interest Period shall extend beyond the Maturity Date, and (c) where an Interest
Period begins on a day for which there is no numerically corresponding day in
the calendar month in which the Interest Period is to end, such Interest Period
shall end on the last Business Day of such calendar month.
"INTEREST RATE SWAP OBLIGATIONS" means the present and future
obligations of the Borrower to any Lender or the Lenders arising from the
Borrower's entering into an interest rate swap, collar, hedge or other like
transaction for the management of interest rates with respect to the Revolving
Credit Loans.
"IRC" means the Internal Revenue Code of 1986, as amended, and any
successor thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time.
"INTERBANK OFFERED RATE" means, for any LIBOR Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100th of 1%) in each case determined by the Agent to be equal to:
(a) the offered rate that appears on the Dow Xxxxx Telerate Screen Page
3750 (or any successor page) that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for
delivery on the first day of the applicable Interest Period) for a term
equivalent to the applicable Interest Period at approximately 11:00
a.m. (London time) two Business Days prior to the first day of the
applicable Interest Period; or
(b) if for any reason the foregoing rate in clause (i) is unavailable
or undeterminable, the offered rate on such other page or other service
that displays an average British Bankers Association Interest
Settlement Rate for deposits in Dollars (for delivery on the first day
of the applicable Interest Period) for a term equivalent to the
applicable Interest Period at approximately 11:00 a.m. (London time)
two Business Days prior to the first day of the applicable Interest
Period; or
(c) if for any reason the foregoing rates in clauses (i) and (ii) are
unavailable or undeterminable, the rate of interest at which deposits
in Dollars for delivery on the first
12
day of the applicable Interest in same day funds in the approximate
amount of the applicable LIBOR Loan for a term equivalent to the
applicable Interest Period would be offered by the London branch of
Bank of America to major banks in the offshore Dollar market at
approximately 11:00 a.m. (London time) two Business Days prior to the
first day of the applicable Interest Period.
"INVESTMENT" means (a) the acquisition (whether for cash, property,
services, assumption of Debt, securities or otherwise) of assets, shares of
Capital Stock, bonds, notes, debentures, partnership, joint ventures or other
ownership interests or other securities of any other Person or (b) any deposit
with, or advance, loan or other extension of credit to, any other Person (other
than deposits made in connection with the purchase of equipment or other assets
in the ordinary course of business) or (c) any other capital contribution to or
investment in any other Person, including, without limitation, any Guaranty
Obligations (including any support for a letter of credit issued on behalf of
such Person) incurred for the benefit of such Person.
"ISSUING LENDER" means Bank of America.
"JOINDER AGREEMENT" means a Joinder Agreement substantially in the form
of Exhibit 5.23 hereto, executed and delivered by an Additional Credit Party in
accordance with the provisions of Section 5.23.
"LAW" OR "LAWS" means all applicable constitutional provisions,
statutes, codes, acts, ordinances, orders, judgments, decrees, injunctions,
rules, regulations, and requirements of all Governmental Authorities.
"LENDERS" means any of the Persons identified as a "Lender" on the
signature pages hereto, and any Person which may become a Lender by way of
assignment in accordance with the terms hereof, together with any successors and
permitted assigns.
"LETTER OF CREDIT" means (a) any letter of credit issued by the Issuing
Lender for the account of the Borrower in accordance with the terms of Section
2.17 and (b) any Existing Letter of Credit.
"LETTER OF CREDIT FEE" shall have the meaning assigned to such term in
Section 2.15.2.
"LEVERAGE RATIO" means, with respect to the Borrower Entities on a
consolidated basis for the twelve month period ending on the last day of any
fiscal quarter, the ratio of (a) Total Funded Debt of the Borrower Entities on
the last day of such period to (b) Consolidated EBITDA for such period.
"LIBO RATE" means, for any LIBOR Loan for any Interest Period therefor,
the rate per annum (rounded upwards, if necessary, to the nearest 1/100 of 1%)
determined by the Agent to be equal to the quotient obtained by dividing (a) the
Interbank Offered Rate for such LIBOR Loan for such Interest Period by (b) 1
minus the LIBO Rate Reserve Requirement for such LIBOR Loan for such Interest
Period.
13
"LIBO RATE RESERVE REQUIREMENT" means, at any time, the maximum rate at
which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) by member banks of the Federal Reserve System
against "Eurocurrency liabilities" (as such term is used in Regulation D).
Without limiting the effect of the foregoing, the LIBO Rate Reserve Requirement
shall reflect any other reserves required to be maintained by such member banks
with respect to (i) any category of liabilities which includes deposits by
reference to which the Adjusted LIBOR Rate is to be determined, or (ii) any
category of extensions of credit or other assets which include LIBOR Loans. The
Adjusted LIBOR Rate shall be adjusted automatically on and as of the effective
date of any change in the LIBO Rate Reserve Requirement.
"LIBOR LIABILITIES" means deposit liabilities which are deemed to be
Eurocurrency liabilities as such term is defined under the regulations of the
Board of Governors of the Federal Reserve Bank.
"LIBOR LOAN" means a Loan for which the Borrower has elected
application of an interest rate based on the LIBO Rate.
"LOAN" means any Revolving Credit Loan and/or any Swingline Loan,
individually or collectively, as appropriate.
"LOAN DOCUMENTS" means a collective reference to this Agreement, the
Notes, the Guaranty Agreement, the Security Agreement, the Collateral
Assignment, the LOC Documents, each Joinder Agreement and all other related
agreements and documents issued or delivered hereunder or thereunder or pursuant
hereto or thereto (in each case as the same may be amended, modified, restated,
supplemented, extended, renewed or replaced from time to time), and "LOAN
DOCUMENT" means any one of them.
"LOC COMMITMENT" means the commitment of the Issuing Lender to issue
Letters of Credit in an aggregate face amount at any time outstanding (together
with the amounts of any unreimbursed drawings thereon) of up to the LOC
Committed Amount.
"LOC COMMITTED AMOUNT" shall have the meaning assigned to such term in
Section 2.17.1.
"LOC DOCUMENTS" means, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in connection
therewith, any application therefor, and any agreements, instruments, guarantees
or other documents (whether general in application or applicable only to such
Letter of Credit) governing or providing for (i) the rights and obligations of
the parties concerned or at risk or (ii) any collateral security for such
obligations.
"LOC OBLIGATIONS" means, at any time, without duplication, the sum of
(i) the maximum amount which is, or at any time thereafter may become, available
to be drawn under Letters of Credit then outstanding, assuming compliance with
all requirements for drawings referred to in such
14
Letters of Credit plus (ii) the aggregate amount of all drawings under Letters
of Credit honored by the Issuing Lender but not theretofore reimbursed by the
Borrower.
"MATERIAL ADVERSE CHANGE" means any material and adverse change in the
business, Properties, financial condition or operations of the Borrower Entities
in the aggregate.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
business, Properties, financial condition or operations of the Borrower Entities
taken as a whole, (ii) the ability of any Credit Party to perform any material
obligation under the Loan Documents to which it is a party or (iii) the material
rights and remedies of the Agent and the Lenders under the Loan Documents.
"MATURITY DATE" means July 1, 2005.
"MAXIMUM LAWFUL AMOUNT" means the maximum lawful amount of interest,
loan charges, commitment fees or other charges that may be assessed under
Georgia law or, if higher, under applicable federal law.
"MOODY'S" means Xxxxx'x Investors Service, Inc. or any successor or
assignee in the business of rating securities.
"NET PROCEEDS" means the aggregate cash proceeds (including cash
actually received by way of deferred payment pursuant to a promissory note,
receivable or otherwise) received by the Borrower or any Borrower Entity of any
Asset Disposition, Equity Issuance or Debt Issuance, net of (a) direct costs and
expenses (including, without limitation, legal, accounting and investment
banking fees and sales commissions), (b) taxes paid or payable as a result
thereof and (c) in the case of any Asset Disposition, the amount necessary to
retire any Debt secured by a Permitted Encumbrance (ranking senior to any Lien
of the Collateral Agent) on the related Property; it being understood that "Net
Proceeds" shall include, without limitation, any cash received upon the sale or
other disposition of any non-cash consideration received by the Borrower or any
Borrower Entity in any Asset Disposition, Equity Issuance or Debt Issuance.
"NON-GUARANTOR SUBSIDIARY" means any Subsidiary of the Borrower that is
not a Guarantor.
"NON-OPINION SUBSIDIARIES" means those wholly owned Domestic
Subsidiaries of the Borrower for which the Agent has not received a legal
opinion (in form and substance reasonably satisfactory to the Agent) from
outside counsel to the Credit Parties, and "NON-OPINION SUBSIDIARY" means any
one of them.
"NOTE" OR "NOTES" means the Revolving Credit Notes and/or the Swingline
Note, individually or collectively, as appropriate.
"OBLIGATIONS" means (i) the present and future obligations of the
Borrower to the Lenders (including the Issuing Lender) to repay the Revolving
Credit Loans, the Swingline Loans, and all other obligations of the Borrower and
the other Borrower Entities to the Lenders
15
and to the Agent, whenever arising, under this Agreement and the other Loan
Documents (including, but not limited to, any interest accruing after the
occurrence of a Bankruptcy Event with respect to the Borrower or any other
Borrower Entity, regardless of whether such interest is an allowed claim under
the Bankruptcy Code), and (ii) the present and future obligations of the
Borrower to any Lender or any Affiliate of a Lender with respect to any Interest
Rate Swap Obligations.
"OPERATING LEASES" means leases that are not Capital Leases.
"PARTICIPATION INTEREST" means a purchase by a Lender of a
participation in Letters of Credit or LOC Obligations as provided in Section
2.17 or in any Loans as provided in Section 9.8.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"PERMITTED ACQUISITION" means the acquisition for consideration no
greater than fair market value (as determined by the Board of Directors of the
applicable Borrower Entity in good faith) (by asset purchase, stock purchase,
merger or otherwise) by a Borrower Entity of at least a majority of the Capital
Stock of another Person, or of substantially all of the assets of another
Person, or of substantially all of the assets of another Person used by that
Person in a distinct line of business or a distinct geographic or other division
of its business (it being acknowledged that medical records and certain other
professional assets that are required by Law to be owned by a Provider are not
acquired in these transactions), which meets the following criteria:
(a) The line of business engaged in by the acquired Person, or
the line of business in which the acquired assets were and are
utilized, must be within the Borrower's Line of Business.
(b) There may exist no Default or Event of Default at the time
of the acquisition or after giving effect to the acquisition including,
but not limited to, any Event of Default resulting from the breach of
any financial covenant contained in this Agreement.
(c) The consent of the Required Lenders shall be required as
to any single acquisition for which the Cash Consideration and non-cash
consideration (including without limitation, any Debt issued to finance
any such acquisition, any Capital Stock issued to finance any such
acquisition and any assumption of liabilities) exceeds $25,000,000.
(d) After giving effect to such acquisition, the aggregate of
(i) the Cash Consideration and non-cash consideration (including
without limitation, any Debt issued to finance any such acquisition,
any Capital Stock issued to finance any such acquisition and any
assumption of liabilities) for all acquisitions (excluding all
Permitted Equity Investments and Permitted Stock Purchases) in any
fiscal year plus (ii) all Permitted
16
Equity Investments in such fiscal year plus (iii) all Permitted Stock
Purchases in such fiscal year shall not exceed $100,000,000.
(e) The Agent shall have received all items in respect of the
Capital Stock acquired in the acquisition required to be delivered by
Section 5.23.
(f) In the case of any acquisition of the Capital Stock of
another Person, the board of directors (or other comparable governing
body) of such Person shall have duly approved the acquisition.
(g) The representations and warranties made by the Credit
Parties in any Loan Document shall be true and correct in all material
respects at and as if made as of the date of the acquisition (after
giving effect thereto) except to the extent such representations and
warranties expressly relate to an earlier date.
(h) With respect to any single acquisition for which the Cash
Consideration and non-cash consideration (including without limitation,
any Debt issued to finance any such acquisition, any Capital Stock
issued to finance any such acquisition and any assumption of
liabilities) exceeds $10,000,000, within fifteen (15) days after the
date of closing of such acquisition, (i) the Borrower shall have
delivered to the Agent, a Pro Forma Compliance Certificate
demonstrating that, upon giving effect to such acquisition on a pro
forma basis, the Borrower shall be in compliance with all of the
covenants set forth in Article VII and (ii) the Borrower shall provide
the Lenders with (A) a description of the operating profile of the
target, (B) a description of the terms of the acquisition (including,
but not limited to, the purchase price and method and structure of
payment thereof), and (C) historical financial statements of the target
for the most recent two fiscal years and for any subsequent interim
periods.
"PERMITTED DIVIDENDS" means (a) dividends or distributions by any
Borrower Entity which is not wholly owned (directly or indirectly) by the
Borrower to shareholders, members or partners of such Borrower Entity; provided,
that, such dividends or distributions are made by such Borrower Entity with
positive cash flow generated by such Borrower Entity and (b) dividends or
distributions by any Borrower Entity which is not wholly owned (directly or
indirectly) by the Borrower to shareholders, members or partners of such
Borrower Entity; provided, that, such dividends or distributions are made with
proceeds received from the sale of the Capital Stock of such Borrower Entity or
all or substantially all of the assets of such Borrower Entity in accordance
with the terms of Section 6.7(iii).
"PERMITTED ENCUMBRANCES" means all of the following:
(a) Encumbrances securing the payment of (i) any of the
Obligations and (ii) any of the 364-Day Obligations.
(b) Encumbrances securing taxes, assessments, or other
governmental charges not yet due or which are being contested in good
faith by appropriate action promptly
17
initiated and diligently conducted, if the Borrower has made reserve
therefor as required by GAAP.
(c) Mechanics', repairmen's, materialmen's, warehousemen's,
landlords' and other like liens arising by operation of law securing
accounts that are not delinquent.
(d) Encumbrances on real property used by the Borrower not
securing monetary obligations, provided that the Encumbrances are of a
type customarily placed on real property and do not materially impair
the value of the affected property.
(e) Pledges or deposits in the ordinary course of business to
secure nondelinquent obligations under insurance programs, xxxxxxx'x
compensation or unemployment laws or similar legislation or to secure
the performance of leases or contracts entered into in the ordinary
course of business.
(f) Encumbrances arising from good faith deposits in
connection with or to secure performance of statutory obligations and
surety and appeal bonds.
(g) Encumbrances arising by operation of law relating to
bankers' liens, rights of setoff or similar rights as to deposit
accounts or other funds maintained with a creditor depository
institution, provided that the Borrower Entity has no contractual
obligation to maintain any account with the creditor institution.
(h) Encumbrances on Property securing purchase money Debt
(including Capital Leases and Synthetic Leases) permitted by Section
6.1, provided that any such Encumbrance attaches to such Property
concurrently with or within 90 days after the acquisition thereof.
(i) Encumbrances securing judgments that themselves do not
give rise to an Event of Default.
"PERMITTED EQUITY INVESTMENT" means (a) any equity interest owned
directly by any Borrower Entity in any Person which is not a Borrower Entity as
of the Closing Date and (b) any capital contribution, purchase or other
acquisition of Capital Stock not constituting a Permitted Acquisition by any
Borrower Entity in any Person which is not a Borrower Entity subsequent to the
Closing Date; provided, that (i) such Person is engaged only in activities
included in the Borrower's Line of Business, (ii) the capital contributions,
purchases or other acquisitions of Capital Stock not constituting Permitted
Acquisitions made in any such Person in a single transaction shall not exceed
$25,000,000 and (iii) after giving effect to any such capital contribution,
purchase or other acquisition of Capital Stock not constituting a Permitted
Acquisition, the aggregate of (x) the Cash Consideration and non-cash
consideration (including without limitation, any Debt issued to finance any such
acquisition, any Capital Stock issued to finance such acquisition and any
assumption of liabilities) for all Permitted Acquisitions in any fiscal year
plus (y) all capital contributions, purchases or other acquisitions of Capital
Stock not constituting a Permitted Acquisition by Borrower Entities in Persons
that are not Borrower
18
Entities pursuant to this subclause (b) in such fiscal year and (z) all
Permitted Stock Purchases in such fiscal year, shall not exceed $100,000,000.
"PERMITTED STOCK PURCHASES" means any purchase of the Capital Stock of
any Borrower Entity which is not wholly-owned (directly or indirectly) by the
Borrower in an amount not to exceed $25,000,000 in any single transaction;
provided, that, after giving effect to any such purchase of Capital Stock, the
aggregate of (i) the Cash Consideration and non-cash consideration (including
without limitation, any Debt issued to finance any such acquisition, any Capital
Stock issued to finance any such acquisition and any assumption of liabilities)
for all Permitted Acquisitions in any fiscal year plus (ii) all Permitted Equity
Investments in such fiscal year plus (iii) all purchases of Capital Stock of any
Borrower Entity which is not wholly-owned (directly or indirectly) by the
Borrower in such fiscal year, shall not exceed $100,000,000.
"PERSON" means any individual, corporation, partnership, joint venture,
limited liability company, association, joint stock company, trust,
unincorporated organization, government, governmental agency or political
subdivision thereof, or any other form of entity.
"PLAN" means any employee benefit or other plan established or
maintained, or to which contributions have been made, by the Borrower or any
Subsidiary and covered by Title IV of ERISA or to which Section 412 of the IRC
applies.
"PRACTICE" means a dialysis clinic or laboratory or a nephrology
medical practice. Whenever in this Agreement "Practice" is used in describing an
acquisition by a Borrower Entity, and if the reference relates to a medical
practice, such reference is to the acquisition of the assets used in the
operation of the Practice that can lawfully be acquired by such Borrower Entity
or to the acquisition of the stock of a corporation that owns, as of the time of
purchase, only those assets that can be lawfully acquired by such Borrower
Entity
"PRICING TIER DETERMINATION DATE" means the fifth (5th) Business Day
following the date by which the Borrower is required to provide to the Agent and
the Lenders financial reports and certifications as required by Section 5.3
hereof that contain a calculation of, and information sufficient to support the
calculation of, the Leverage Ratio for the preceding four fiscal quarters.
"PRIME RATE" means, for any day, the rate per annum in effect for such
day as publicly announced from time to time by Bank of America as its "prime
rate." Such rate is a rate set by Bank of America based upon various factors
including Bank of America's costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate. Any change
in such rate announced by Bank of America shall take effect at the opening of
business on the day specified in the public announcement of such change.
"PRO FORMA COMPLIANCE CERTIFICATE" means a certificate of the chief
financial officer of the Borrower delivered to the Agent in connection with a
Permitted Acquisition and containing reasonably detailed calculations, upon
giving effect to the applicable transaction on a pro forma basis, of the
financial covenants set forth in Article VII.
19
"PRO RATA" OR "PRO RATA SHARE" refer to the apportionment among the
Lenders according to their respective Commitments at the time of determination;
provided, however, only for the purpose of making distributions of funds
received after the maturity of the Revolving Credit Loans (by acceleration or
otherwise), "Pro Rata" or "Pro Rata Share" shall refer to the apportionment
among the Lenders according to their respective Commitments and also taking into
account any Interest Rate Swap Obligations that may then be due to them from the
Borrower.
"PROPERTY" OR "PROPERTIES" means any interest in any kind of property,
whether real, personal, or mixed, or tangible or intangible.
"PROVIDER" means a nephrologist who performs professional services
respecting a Practice that is either managed by a Borrower Entity or the assets
of which are owned by a Borrower Entity.
"REGISTER" shall have the meaning given to such term in Section 9.10.
"REGULATION D, T, U OR X" means Regulation D, T, U or X, respectively,
of the Board of Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"REQUIRED LENDERS" means the Lenders holding more than sixty-six and
two-thirds percent (662/3%) of (i) the Total Commitments on the date of
determination (including the Participation Interests of the Issuing Lender in
any Letters of Credit) or (ii) if the Commitments have been terminated, the
outstanding Loans, LOC Obligations and Participation Interests (including the
Participation Interests of the Issuing Lender in any Letter of Credit);
provided, however, that the Commitment of any Lender not then in compliance with
its obligations hereunder (as determined by the Agent) shall be excluded from
the determination of the Required Lenders.
"RESTRICTED PAYMENT" means (i) any dividend or other distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
any Borrower Entity, now or hereafter outstanding, (ii) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of Capital Stock of any
Borrower Entity, now or hereafter outstanding, and (iii) any payment made to
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire shares of any class of Capital Stock of any Borrower
Entity, now or hereafter outstanding.
"REVOLVING CREDIT LOANS" means the collective reference to the
revolving credit loans made to the Borrower pursuant to Article II hereof.
"REVOLVING CREDIT NOTE" means any of the Revolving Credit Notes
referred to in Section 2.3 hereof .
"S & P" means Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc., or any successor or assignee in the business of rating securities.
20
"SECURITY AGREEMENT" means that certain Amended and Restated Equity
Interests Security Agreement dated as of the Closing Date in the form of Exhibit
3.1.1(e) executed by each of the Credit Parties and the Collateral Agent, as
amended, modified, restated or supplemented from time to time.
"SELLER" means the owner or owners of a Practice that is acquired by a
Borrower Entity.
"SERVICE AGREEMENT" means one of those service or management agreements
now in effect or hereafter entered into by a Borrower Entity and Sellers in
connection with the management of nephrology practices.
"SOLVENT" means, as to any Person, that as of any date of
determination, (i) the then fair value of the assets of such Person is (a)
greater than the then total amount of liabilities (including subordinated
liabilities) of such Person and (b) greater than the amount that will be
required to pay such Person's probable liability on such Person's then existing
debts as they become absolute and matured, (ii) such Person's capital is not
unreasonably small in relation to its business, and (iii) such Person has not
incurred and does not intend to incur, or believe or reasonably should believe
that it will incur, debts beyond its ability to pay such debts as they become
due.
"SUBSIDIARY" means any present or future corporation or other entity at
least a majority of whose outstanding voting stock or other voting securities
shall at the time be owned directly or indirectly by one or more Borrower
Entities or which is owned to a lesser degree but which is sufficiently
controlled by the Borrower Entities that the owned entity is required to be
reported with the other Borrower Entities on a consolidated basis under GAAP.
"SWINGLINE BORROWING NOTICE" has the meaning assigned in Section
2.16.3(b) hereof.
"SWINGLINE COMMITMENT" means Ten Million Dollars ($10,000,000.00).
"SWINGLINE LENDER" means Bank of America, together with any successors
or assigns in such capacity.
"SWINGLINE LOANS" means the loan advanced by the Swingline Lender under
Section 2.16 hereof.
"SWINGLINE NOTE" means the promissory note made by the Borrower in
substantially the form of Exhibit 1.3 hereto executed and delivered to the
Swingline Lender, together with any amendments, modifications and supplements
thereto and restatements thereof.
"SYNTHETIC LEASE" means any tax retention operating lease, off-balance
sheet loan or similar off-balance sheet financing product where such transaction
is considered borrowed money indebtedness for tax purposes but is classified as
an Operating Lease in accordance with GAAP.
21
"TOTAL CAPITALIZATION RATIO" means, as of any day, with respect to the
Borrower Entities on a consolidated basis, the ratio of (i) Total Funded Debt of
the Borrower Entities to (b) the sum of Total Funded Debt of the Borrower
Entities plus Consolidated Net Worth.
"TOTAL COMMITMENTS" means the total amount of all Commitments in effect
from time to time.
"TOTAL FUNDED DEBT" means, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to Property purchased by such Person (other than customary
reservations or retentions of title under agreements with suppliers entered into
in the ordinary course of business), (d) all obligations of such Person issued
or assumed as the deferred purchase price of Property or services purchased by
such Person (other than trade debt incurred in the ordinary course of business
and due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person (including earnout obligations),
(e) the implied principal component of all obligations of such Person under
Capital Leases, (f) the maximum amount of all performance and standby letters of
credit issued or bankers' acceptances facilities created for the account of such
Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (g) all preferred Capital Stock issued by such Person and which
by the terms thereof could be (at the request of the holders thereof or
otherwise) subject to mandatory sinking fund payments, redemption or other
acceleration at any time on or prior to the Termination Date, (h) the principal
portion of all obligations of such Person under Synthetic Leases, (i) the
aggregate amount of uncollected accounts receivable of such Person subject at
such time to a sale of receivables (or similar transaction) to the extent such
transaction is effected with recourse to such Person (whether or not such
transaction would be reflected on the balance sheet of such Person in accordance
with GAAP), (j) all Total Funded Debt of others secured by (or for which the
holder of such Total Funded Debt has an existing right, contingent or otherwise,
to be secured by) any Lien on, or payable out of the proceeds of production
from, Property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, but only to the extent of the value of such
Property, (k) all Guaranty Obligations of such Person with respect to Total
Funded Debt of another Person and (l) the Total Funded Debt of any partnership
or unincorporated joint venture in which such Person is a general partner or a
joint venturer to the extent such Total Funded Debt is recourse to such Person.
"UCC" means the Uniform Commercial Code as adopted in Georgia, as it
may be amended from time to time.
"UNUSED REVOLVING COMMITMENTS" means, for any period, the amount by
which (a) the then applicable Total Commitments exceed (b) the daily average sum
for such period of (i) the outstanding aggregate principal amount of all
Revolving Credit Loans plus (ii) the outstanding aggregate principal amount of
all LOC Obligations.
22
"WHOLLY-OWNED SUBSIDIARY" means any Person 100% of whose Capital Stock
is at the time owned by the Borrower directly or indirectly through other
Persons 100% of whose Capital Stock is at the time owned, directly or
indirectly, by the Borrower.
1.2 TERMS GENERALLY.
1.2.1 Computations; Accounting Principles. Except as otherwise
expressly provided herein, all accounting terms used herein shall be
interpreted, and all financial statements and certificates and reports
as to financial matters delivered to the Lenders hereunder shall be
prepared, in accordance with GAAP applied on a consistent basis. All
calculations made for the purposes of determining compliance with this
Agreement shall (except as otherwise expressly provided herein) be made
by application of GAAP applied on a basis consistent with the most
recent annual or quarterly financial statements delivered pursuant to
Section 5.3 (or, prior to the delivery of the first financial
statements pursuant to Section 5.3., consistent with the financial
statements as at December 31, 2001); provided, however, if (a) the
Borrower shall object to determining such compliance on such basis at
the time of delivery of such financial statements due to any change in
GAAP or the rules promulgated with respect thereto or (b) the Agent or
the Required Lenders shall object to determining such compliance on
such basis in writing within 60 days after delivery of such financial
statements due to any change in GAAP or the rules promulgated with
respect thereto, then such calculations shall be made on a basis
consistent with the most recent financial statements delivered by the
Borrower to the Lenders as to which no such objection shall have been
made.
Notwithstanding the above, the parties hereto acknowledge and
agree that, for purposes of all calculations made under the financial
covenants set forth in Article VII and for purposes of the definition
of "Applicable Commitment Fee", "Applicable LIBO Rate Margin",
"Applicable Base Rate Margin" and "Applicable Letter of Credit Fee" set
forth in Section 1.1, in connection with any Permitted Acquisition,
income statement and balance sheet items (whether positive or negative)
attributable to the Property acquired in any Permitted Acquisition and
any Debt incurred by the Borrower or any of its Subsidiaries in order
to consummate such Permitted Acquisition shall be included to the
extent relating to any period applicable in such calculations occurring
after the date of such Permitted Acquisition (and, notwithstanding the
foregoing, during the first four fiscal quarters following the date of
such Permitted Acquisition, (i) such Permitted Acquisition and any
Indebtedness incurred by the Borrower or any of its Subsidiaries in
order to consummate such Permitted Acquisition (a) shall be deemed to
have occurred on the first day of the four fiscal quarter period
immediately preceding the date of such Permitted Acquisition and (b) if
such Indebtedness has a floating or formula rate, then the implied rate
of interest for such Indebtedness for the applicable period shall be
determined by utilizing the rate which is or would be in effect with
respect to such Indebtedness as at the relevant date of determination).
1.2.2 Gender and Number. Words used herein indicating gender
or number shall be read as context may require.
23
1.2.3 References Include Successors. References herein to
specific Laws, regulatory bodies, parties or agreements also refer to
any successor Laws, regulatory bodies, and parties, and to all
modifications, extensions, renewals and restatements of agreements.
1.2.4 References to This Agreement. "Herein," "hereof" and
words of similar import refer to this Agreement as a whole and not to
any particular provision hereof, unless otherwise expressly stated.
II. CREDIT FACILITIES
Upon the terms and subject to the conditions set forth in this
Agreement, (i) the Lenders hereby grant to the Borrower a revolving credit
facility pursuant to which each Lender severally agrees to make Revolving Credit
Loans in accordance with the following terms and conditions of this Article II,
(ii) the Swingline Lender agrees to make Swingline Loans in accordance with the
following terms and conditions of this Article II and (iii) the Issuing Lender
agrees to issue, and each Lender severally agrees to participate in the issuance
by the Issuing Lender of standby Letters of Credit, in accordance with the
following terms and conditions of this Article II:
2.1 AMOUNT OF REVOLVING CREDIT LOANS.
The aggregate principal amount of all outstanding Revolving Credit
Loans plus the aggregate principal amount of all outstanding Swingline Loans
plus the aggregate principal amount of LOC Obligations outstanding shall not
exceed the total amount of the Commitments in effect from time to time. With
respect to each Lender individually, such Lender's pro rata share of outstanding
Revolving Credit Loans plus such Lender's pro rata share of outstanding
Swingline Loans plus such Lender's pro rata share of LOC Obligations outstanding
shall not exceed such Lender' s Commitment.
2.2 USE OF PROCEEDS OF REVOLVING CREDIT LOANS.
The proceeds of the Revolving Credit Loans shall be used by the
Borrower for Permitted Acquisitions, Capital Expenditures, working capital and
other general corporate purposes related to the Borrower's Line of Business.
2.3 REVOLVING CREDIT NOTES.
Each Lender's Revolving Credit Loans and the Borrower's obligations to
repay such Revolving Credit Loans shall be evidenced by separate Revolving
Credit Notes executed by the Borrower payable to the order of such Lender in the
form included as Exhibit 2.3 hereto.
24
2.4 SEPARATE COMMITMENTS OF THE LENDERS.
The Borrower acknowledges that each Lender's commitment to fund its
portion of the Revolving Credit Loans is made by each Lender severally, and
neither the Agent nor any Lender shall be liable for the failure of another
Lender to timely perform under this Agreement.
2.5 ADVANCES OF LOANS.
Subject to the terms and conditions of this Agreement, the Borrower may
borrow, repay and reborrow Revolving Credit Loans, provided that the outstanding
principal balance of the Revolving Credit Loans shall not at any time exceed the
respective amounts permitted under Section 2.1 above. Loans shall be disbursed
as follows:
2.5.1 Advanced Pursuant to Borrowing Notices.
2.5.1(a) Applicability. Revolving Credit Loans may
consist of LIBOR Loans, Base Rate Loans, or a combination
thereof, and the funding thereof shall be subject to this
Section 2.5.1.
2.5.1(b) Borrowing Notices. As long as the Borrower
meets the conditions for funding stated in this Agreement, the
Borrower may submit requests for Revolving Credit Loans
("Borrowing Notices") to the Agent. All requests shall be made
in writing or by telephone, subject to such security
procedures as the Agent may require from time to time
(provided that all such telephonic notices shall be confirmed
by written Borrowing Notices within one (1) Business Day) and
shall specify the proposed disbursement date for the requested
Revolving Credit Loan; the amount of the Revolving Credit
Loan; the purpose of the Revolving Credit Loan (characterized
in accordance with Section 2.2 above); the type of Revolving
Credit Loan, i.e., LIBOR Loan or Base Rate Loan; and if a
LIBOR Loan, the designated Interest Period. Each Borrowing
Notice shall irrevocably obligate the Borrower to accept the
Loan requested thereby. Borrowing Notices shall be in the form
of Exhibit 2.5.l(b) hereto or such other form as the Agent may
from time to time reasonably require.
2.5.1(c) Funding of Loans. The Lenders shall fund
their respective portions of requested Revolving Credit Loans
on the Banking Day (determined with a cutoff of 11:00 a.m.
Charlotte, North Carolina time, as provided in the definition
thereof) of the Agent's receipt of the Borrowing Notice, in
the case of Base Rate Loans, and on the third (3rd) Banking
Day following the Banking Day of Agent's receipt of the
Borrowing Notice, in the case of LIBOR Loans. All funds shall
be disbursed directly into an account maintained by the
Borrower with the Agent. The Borrower agrees that if any
Lender elects to fund any requested Revolving Credit Loan(s)
sooner after requested than is required hereunder, the Lender
may nevertheless use the entire response period allowed
hereunder upon receipt of any subsequent request, at the
Lender's sole option.
25
2.5.1(d) Base Rate Loan Limitations for Revolving
Credit Loans. Except for Revolving Loans made for the purpose
of reimbursing the Issuing Lender in respect of a drawing
under a Letter of Credit pursuant to Section 2.17.5, each
Revolving Credit Loan that is a Base Rate Loan shall be in the
minimum amount of $1,000,000.00 each and in multiples of
$100,000.00.
2.5.1(e) LIBOR Loan Limitations. Except for Revolving
Credit Loans made for the purpose of reimbursing the Issuing
Lender in respect of a drawing under a Letter of Credit
pursuant to Section 2.17.5, individual LIBOR Loans shall be in
the minimum amount of $1,000,000.00 each and shall be
requested in increments of $500,000.00. For purposes hereof,
LIBOR Loans with different Interest Periods shall be
considered as separate LIBOR Loans, even if they begin on the
same date, although borrowings, extensions and conversions
may, in accordance with the provisions hereof, be combined at
the end of existing Interest Periods to constitute a new
single LIBOR Loan with a single Interest Period. No more than
eight (8) LIBOR Loans may be outstanding hereunder at any
time.
2.5.1(f) Additional Limitation on LIBOR Interest
Periods. Notwithstanding anything to the contrary in this
Agreement, if a Default or an Event of Default shall have
occurred and be continuing, no additional LIBOR Loans may be
created.
2.5.2 Conversion of Loans. The Borrower shall have the right,
on prior notice to the Agent made in writing or by telephone, subject
to such security procedures as the Agent may require from time to time
(provided that all such telephonic notices shall be confirmed by
written Borrowing Notices within one (1) Business Day), which notice
shall be given three (3) Banking Days (determined with a cutoff of
11:00 a.m. Charlotte, North Carolina time, as provided in the
definition thereof) prior to the date of any requested conversion, to
convert any Base Rate Loan or LIBOR Loan into a Revolving Credit Loan
of another type, or to continue any LIBOR Loan for another Interest
Period, subject in each case to the following:
2.5.2(a) Application of Loans. Each conversion shall
be effected by applying the proceeds of the new LIBOR Loan
and/or Base Rate Loan, as the case may be, to the Revolving
Credit Loans (or portion thereof) being converted.
2.5.2(b) Notices of Conversions. Each notice pursuant
to this 2.5.2(b) shall be irrevocable and shall refer to this
Agreement and specify the identity and principal amount of the
particular Revolving Credit Loans that the Borrower requests
be converted or continued; if such notice requests conversion,
the date of such conversion (which shall be a Business Day);
and if a Revolving Credit Loan is to be converted to a LIBOR
Loan or a LIBOR Loan is to be continued, the Interest Period
with respect thereto. No LIBOR Loan shall be converted at any
time other than at the end of the Interest Period applicable
26
thereto, except in accordance with Section 2.11 hereof.
Conversion notices shall be in the form attached as Exhibit
2.5.1(b) hereto.
2.5.3 Absence of Election. In the event that the Borrower
shall not give notice to continue any LIBOR Loan for a subsequent
period, such LIBOR Loan (unless repaid) shall automatically be
converted into a Base Rate Loan. If the Borrower fails to specify in
any Borrowing Notice the type of borrowing or, in the case of a LIBOR
Loan, the applicable Interest Period, the Borrower will be deemed to
have requested a Base Rate Loan. If the Agent reasonably believes that
any failure by the Borrower to specify the type of borrowing or the
applicable Interest Period shall have resulted from failure of
communications equipment or clerical error, then prior to funding any
such borrowing Agent shall use reasonable efforts to obtain
confirmation from the Borrower of the contents of such Borrowing
Notice; provided, however, in the absence of prompt confirmation by the
Borrower which specifies the type of borrowing and/or the applicable
Interest Period, the Borrower will be deemed to have requested a Base
Rate Loan. Notwithstanding anything to the contrary contained above, if
a Default or Event of Default shall have occurred and be continuing, no
LIBOR Loan may be continued and no Base Rate Loan may be converted into
a LIBOR Loan.
2.5.4 Implied Representations Upon Request for Revolving
Credit Loan. Upon making any request for any Loan, the Borrower shall
be deemed to have warranted to the Agent and the Lenders that all
conditions to funding set forth in Article III hereof are satisfied and
that all warranties made herein are true and shall be true as of the
funding of the requested Loan, subject to exception for warranties that
speak to a specific date or for which the underlying facts have changed
pursuant to transactions permitted under this Agreement.
2.5.5 Advance Not Waiver. Any Lender's making of any Loan that
it is not obligated to make under any provision of Article III hereof
or any other provision hereof shall not be construed as a waiver of
such Lender's right to withhold future Loans, notify the Agent of an
Event of Default, or otherwise demand strict compliance with this
Agreement.
2.5.6 Draws by Debit Memorandum. The Agent may cause the
Lenders to draw amounts that may be available under the Revolving
Credit Loans to pay any Obligation that is not otherwise timely paid.
2.6 INTEREST.
Interest shall accrue on each Revolving Credit Loan as follows:
2.6.1 Base Rate Loans. Interest shall accrue on each Base Rate
Loan at an annual rate equal to the Alternate Base Rate plus the
Applicable Base Rate Margin, said rate to change contemporaneously with
any change in the Alternate Base Rate or the Alternate Base Rate
Margin.
27
2.6.2 LIBOR Loans. Interest shall accrue on each LIBOR Loan at
a rate equal to the LIBO Rate for the selected Interest Period plus the
Applicable LIBO Rate Margin, said rate to change contemporaneously with
any change in the LIBO Rate Margin.
2.6.3 Calculation of Interest. Interest for both Base Rate
Loans and LIBOR Loans shall be computed on the basis of a 360-day year
counting the actual number of days elapsed. Interest shall accrue on
the Business Day a Revolving Credit Loan is extended and shall accrue
to but not including the Banking Day that payment is received by the
Agent in immediately available funds.
2.6.4 Default Rate. Notwithstanding the foregoing, upon the
occurrence of an Event of Default and during the continuation of such
Event of Default, interest shall be charged at the Default Rate,
regardless of whether the Lenders have elected to exercise any other
remedies available to the Lenders, including, without limitation,
acceleration of the maturity of the outstanding principal of the Loans.
2.6.5 Payment of Interest. Interest for Base Rate Loans and
LIBOR Loans shall be due and payable in arrears, without notice, on
each Interest Payment Date.
2.6.6 Usury-Savings Provision. It is the intention of the
parties that all charges under or in connection with this Agreement and
the Obligations, however denominated, and including (without
limitation) all interest, commitment fees, late charges and loan
charges, shall be limited to the Maximum Lawful Amount. Such charges
hereunder shall be characterized and all provisions of the Loan
Documents shall be construed as to uphold the validity of charges
provided for therein to the fullest possible extent. Additionally, all
charges hereunder shall be spread over the full permitted term of the
Obligations for the purpose of determining the effective rate thereof
to the fullest possible extent, without regard to prepayment of or the
right to prepay the Obligations. If for any reason whatsoever, however,
any charges paid or contracted to be paid in respect of the Obligations
shall exceed the Maximum Lawful Amount, then, without any specific
action by the Lenders, the Agent or the Borrower, the obligation to pay
such interest and/or other charges shall be reduced to the Maximum
Lawful Amount in effect from time to time, and any amounts collected by
the Lenders that exceed the Maximum Lawful Amount shall be applied to
the reduction of the principal balance of the Obligations and/or
refunded to the Borrower so that at no time shall the interest or loan
charges paid or payable in respect of the Obligations exceed the
Maximum Lawful Amount. This provision shall control every other
provision herein and in any and all other agreements and instruments
now existing or hereafter arising between the Borrower and the Lenders
with respect to the Obligations.
2.7 ALTERNATE RATE OF INTEREST IF LIBOR UNAVAILABLE.
In the event, and on each occasion, that on the date of commencement of
any Interest Period for a LIBOR Loan, a Lender shall have determined (i) that
dollar deposits in the amount of the requested principal amount of such LIBOR
Loan are not generally available in the London Interbank Market; (ii) that the
rate at which such dollar deposits are being offered will not
28
adequately and fairly reflect the cost to the Lender of making or maintaining
such LIBOR Loan during such Interest Period; or (iii) that reasonable means do
not exist for ascertaining the LIBO Rate, the Lender shall, as soon as
practicable thereafter, give written or telephonic notice of such determination
to the Borrower and the Agent. In the event of any such determination, any
request by the Borrower for a LIBOR Loan under this Agreement shall, until the
circumstances giving rise to such notice no longer exist, be deemed to be a
request for a Base Rate Loan. Each determination by a Lender hereunder shall be
conclusive absent manifest error.
2.8 CHANGE IN CIRCUMSTANCES.
2.8.1 Imposition of Requirements. Notwithstanding any other
provision herein, if after the date of this Agreement any change in
applicable Laws or in the interpretation or administration thereof by
any Governmental Authority charged with the interpretation or
administration thereof (whether or not having the force of Law) shall
change the basis of taxation of payments to a Lender under any LIBOR
Loan made by the Lender or any other fees or amounts payable hereunder
(other than taxes imposed on the overall net income, gross receipts or
added value of a Lender by the country in which the Lender is located,
or by the jurisdiction in which a Lender has its principal office, or
by any political subdivision or taxing authority therein), or shall
impose, modify or deem applicable any reserve requirement, special
deposit, insurance charge (including FDIC insurance on LIBOR
Liabilities) or similar requirement against assets of, deposits with or
for the account of, or credit extended by, a Lender or shall impose on
a Lender or the London Interbank Market any other condition affecting
this Agreement or LIBOR Loans made by a Lender, and the result of any
of the foregoing shall be to increase the cost to the Lender of making
or maintaining its LIBOR Loan or to reduce the amount of any sum
received or receivable by a Lender hereunder (whether of principal,
interest or otherwise) in respect thereof by an amount deemed by the
affected Lender to be material, then the Borrower will pay to such
Lender such additional amount or amounts as will compensate the Lender
for such additional costs of reduction.
2.8.2 Other Changes. If either (i) the introduction of, or any
change in, or in the interpretation of, any United States or foreign
Law; or (ii) compliance with any directive, guidelines or request from
any central bank or other United States or foreign Governmental
Authority (whether or not having the force of law) promulgated or made
after the date hereof, affects or would affect the amount of capital
required or expected to be maintained by a Lender (or any lending
office of a Lender) or any corporation directly or indirectly owning or
controlling a Lender (or any lending office of a Lender) based upon the
existence of this Agreement, and the Lender shall have determined that
such introduction, change or compliance has or would have the effect of
reducing the rate of return on the Lender's capital or on the capital
of such owning or controlling corporation as a consequence of its
obligations hereunder (including its commitment) to a level below that
which the Lender or such owning or controlling corporation could have
achieved but for such introduction, change or compliance (after taking
into account that Lender's policies or the policies of such owning or
controlling corporation, as the case may be, regarding capital
adequacy) by an amount deemed by the Lender (in its sole discretion) to
be material, then, from time to time, the Borrower shall pay to the
Lender such additional
29
amount or amounts as will compensate the Lender for such reduction
attributable to making, funding and maintaining its commitment and
Loans hereunder.
2.8.3 Computation of Amounts. A certificate of a Lender
setting forth the basis and method of computation of such amount or
amounts specified in Sections 2.8.1 and 2.8.2 hereof as shall be
necessary to compensate the Lender (or its participating banks) as
specified above, as the case may be, shall be delivered to the Borrower
and shall be conclusive absent manifest error; provided however, that
the Borrower shall be responsible for compliance herewith and the
payment of increased costs only to the extent that (i) any change in
Laws giving rise to increased costs occurs after the date of this
Agreement; (ii) such increased costs are imposed by the Lender on all
other borrowers similarly situated with the Borrower; and (iii) the
Lender gives notice of the change giving rise to increased costs within
ninety (90) Business Days after the Lender has, or with reasonable
diligence should have had, knowledge of the change, or else the Lender
can only collect costs from and after the date of the notice. Subject
to the foregoing, the Borrower shall pay the affected Lender the amount
shown as due on any such certificate within ten (10) Business Days
after its receipt of such certificate.
2.8.4 No Duty to Contest. The protection of this Section 2.8
shall be available to a Lender regardless of any possible contention of
invalidity or inapplicability of the Law or condition that shall have
been imposed. Should a Lender assess any charge to the Borrower under
this Section 2.8, and provided that the Borrower pays the assessment to
the affected Lender, the Borrower may within ninety (90) days after
receiving notice of such assessment undertake, at the Borrower's own
expense, any contest of the matters giving rise to the charge that may,
in the opinion of the Borrower's independent counsel issued to the
affected Lender, and concurred in by counsel to the Lender, have a
reasonable chance of success, provided further that the contest would
not require the assertion of any position contrary to a position taken
by the Lender generally with taxing or regulatory authorities or any
other involved parties and that there does not exist any other
circumstance that would disadvantage the Lender in the event of such
contest, as the affected Lender may determine in its discretion. The
affected Lender shall offer reasonable participation to the Borrower
for the purpose of enabling the Borrower to pursue the contest of such
issue, with all expenses, including fees and expenses of the affected
Lender's counsel, to be paid by the Borrower.
2.9 CHANGE IN LEGALITY OF LIBOR LOANS.
Notwithstanding anything to the contrary herein contained, if any
change in any Law or in interpretation thereof by any Governmental Authority
charged with the administration or interpretation thereof shall make it unlawful
for a Lender to make or maintain any LIBOR Loan or to give effect to its
obligations as contemplated hereby, then, by written notice to the Borrower, the
Lender may (i) declare that LIBOR Loans will not thereafter be made by the
Lender hereunder, whereupon the Borrower shall be prohibited from requesting
LIBOR Loans from the Lender hereunder unless such declaration is subsequently
withdrawn; and (ii) require that all outstanding LIBOR Loans made by it be
converted to Base Rate Loans, in which event (a) all such LIBOR Loans shall be
automatically converted to Base Rate Loans (but without
30
imposition of any additional breakage fee or other charge that would normally
become due under Section 2.11 hereof) as of the effective date of such notice,
and (b) all payments and prepayments of principal that would otherwise have been
applied to repay the converted LIBOR Loans shall instead be applied to repay the
Base Rate Loans resulting from the conversion of such LIBOR Loans. Under such
circumstances, a borrowing request for a LIBOR Loan shall be regarded, as to the
Lender who has given notice under this Section 2.9, a request for a Base Rate
Loan, and as to all other Lenders, it shall be regarded as a request for a LIBOR
Loan. For purposes of this Section 2.9, a notice to the Borrower by the Lender
pursuant to (a) above shall be effective, if lawful, on the last day of the then
current Interest Period; in all other cases, such notice shall be effective on
the date of receipt by the Borrower.
2.10 PRINCIPAL REPAYMENT.
The principal amount of all Revolving Credit Loans shall become due and
payable in full on the Maturity Date or the earlier acceleration of the
Revolving Credit Loans in accordance with the terms of this Agreement.
2.11 PREPAYMENT OF LIBOR LOANS.
2.11.1 Notice of LIBOR Loan Prepayment. The Borrower may, upon
three (3) Banking Days' prior written notice to the Agent (with a
Banking Day cutoff of 11:00 a.m. Charlotte, North Carolina time, as
provided in the definition thereof), and upon payment of all applicable
premiums set forth in Section 2.11.3 hereof, prepay any outstanding
LIBOR Loans prior to any Interest Payment Date for such LIBOR Loans, in
whole or in part. Each notice of prepayment of any LIBOR Loan shall
specify the date and amount of such prepayment and shall be
irrevocable.
2.11.2 Amount of LIBOR Loan Prepayment. Each partial
prepayment of any LIBOR Loan shall be in an aggregate principal amount
which is the lesser of (i) the then outstanding principal balance of
the one or more LIBOR Loans to be prepaid, or (ii) $1,000,000.00 or a
larger integral multiple of $100,000.00. Interest on the amount prepaid
accrued to the prepayment date shall be paid on such date.
2.11.3 LIBOR Loan Breakage Costs. The Borrower shall
indemnify, defend and hold harmless each Lender against any loss or
expense that a Lender may incur in connection with the prepayment of a
LIBOR Loan, the Borrower's failure to borrow or to pay when it stated
it would do so, including, but not limited to, the fees or charges
customarily included in "breakage costs" that may result to a Lender
from the early repayment of a LIBOR Liability, which costs may be
calculated by a Lender as though the Loan(s) retired by the Borrower's
prepayment had been match-funded with a corresponding LIBOR Liability,
whether or not the Lender manages its LIBOR Liabilities on a
loan-by-loan basis. Additionally, upon prepayment of any LIBOR Loan on
a date other than the relevant Interest Payment Date for such
borrowing, the Borrower shall pay to the Lenders, in addition to all
other payments then due and owing the Lenders, premiums which shall be
equal to an amount, if any, reasonably determined by the Agent to be
the difference between the rate of interest then applicable to the
relevant
31
LIBOR Loan and the yield the Lenders would receive upon reinvestment of
so much of the relevant LIBOR Loans as is prepaid for the remainder of
the term of the relevant LIBOR Loan or Loans- Anything in this Section
2.11.3 to the contrary notwithstanding, the premiums payable upon any
such prepayment shall not exceed the amount, if any, determined by the
Agent to be the difference between the rate of interest then applicable
to the relevant LIBOR Loan and the yield that the Lenders could receive
upon reinvestment in the "Floor Reinvestment" of so much of the
relevant LIBOR Loan as is prepaid for the remainder of tile term of the
relevant LIBOR Loan. For purposes hereof, "Floor Reinvestment" shall
mean an investment for the time period from the date of such prepayment
to the end of the relevant Interest Period applicable to such LIBOR
Loan at an interest rate per annum equal to the Federal Funds Rate on
the date of such prepayment. All determinations, estimates,
assumptions, allocations and the like required for the determination of
such premiums shall be made by the Agent in good faith and shall be
presumed correct absent manifest error.
2.12 PREPAYMENT OF BASE RATE LOANS.
The Borrower may at any time prepay any outstanding Base Rate Loans
prior to the Maturity Date in whole or in part without premium or penalty upon
at least one Business Day's prior notice to the Agent. All such prepayments
shall be made in minimum amounts of $500,000.00 and in increments of $100,000.00
each.
2.13 MANDATORY PREPAYMENTS.
2.13.1 Commitments.
2.13.1(a) Total Commitments. If at any time, the sum of the
aggregate principal amount of outstanding Revolving Credit Loans plus
LOC Obligations plus Swingline Loans outstanding shall exceed the
aggregate amount of the Total Commitments, the Borrower immediately
shall prepay the Revolving Credit Loans and/or Swingline Loans (and
after all Loans have been repaid) cash collateralize the LOC
Obligations, in an amount sufficient to eliminate such excess.
2.13.1(b) Swingline Commitment. If at any time, the sum of the
aggregate principal amount of Swingline Loans shall exceed the
Swingline Commitment, the Borrower immediately shall prepay the
Swingline Loans in an amount necessary to eliminate such excess.
2.13.1(c) LOC Committed Amount. If at any time, the sum of the
aggregate principal amount of all LOC Obligations shall exceed the LOC
Committed Amount, the Borrower shall immediately cash collateralize the
LOC Obligations in an amount sufficient to eliminate such excess.
2.13.2 Asset Dispositions. Promptly (and in any event within 5
Business Days) after the occurrence of any Asset Disposition, the
Borrower shall prepay the Loans and the 364-Day Loans (on a pro rata
basis) in an aggregate amount equal to one hundred
32
percent (100%) of the Net Proceeds of the related Asset Disposition
(such prepayment to be applied as set forth in Section 2.13.5 below).
Notwithstanding the terms of Section 2.13.5 below, in the event the
Required Lenders consent to an Asset Disposition that would otherwise
be prohibited by the terms of this Agreement, the Lenders agree that
any Net Proceeds from such Asset Disposition remaining after having
prepaid the Loans (as set forth in Section 2.13.5 below) will not be
required to be placed in a cash collateral account to secure the LOC
Obligations.
2.13.3 Issuances of Equity. Promptly (and in any event within
5 Business Days) after the receipt by any Credit Party of proceeds from
any Equity Issuance (other than (a) equity issued by the Borrower to
(i) employees, officers and directors of any Borrower Entity and (ii)
those consultants of any Borrower Entity holding options to purchase
Capital Stock of the Borrower as of the Closing Date and (b) equity
issued by a Credit Party as consideration for a Permitted Acquisition),
the Borrower shall prepay the Loans and the 364-Day Loans (on a pro
rata basis) in an aggregate amount equal to 100% of the Net Proceeds of
such Equity Issuance (such prepayment to be applied as set forth in
Section 2.13.5 below).
2.13.4 Debt Issuances. Immediately upon receipt by any
Borrower Entity of proceeds from any Debt Issuance, the Borrower shall
prepay the Loans and the 364-Day Loans (on a pro rata basis) in an
aggregate amount equal to 100% of the Net Proceeds of such Debt
Issuance to the Lenders (such prepayment to be applied as set forth in
Section 2.13.5 below). Notwithstanding the terms of Section 2.13.5
below, in the event the Required Lenders consent to a Debt Issuance
that would otherwise be prohibited by the terms of this Agreement, the
Lenders agree that any Net Proceeds from such Debt Issuance remaining
after having prepaid the Loans (as set forth in Section 2.13.5 below)
will not be required to be placed in a cash collateral account to
secure the LOC Obligations.
2.13.5 Application of Mandatory Prepayments. All amounts
required to be paid pursuant to this Section 2.13 shall be applied as
follows: (a) with respect to all amounts prepaid pursuant to Section
2.13.1(a), to Revolving Credit Loans and (after all Revolving Credit
Loans have been repaid), to Swingline Loans and (after all Swingline
Loans have been repaid), to a cash collateral account in respect of LOC
Obligations, (b) with respect to all amounts prepaid pursuant to
Section 2.13.1(b), to Swingline Loans, (c) with respect to all amounts
prepaid pursuant to Section 2.13.1(c), to a cash collateral account in
respect of LOC Obligations, (d) with respect to all amounts prepaid
pursuant to Sections 2.13.2 and 2.13.4, pro rata to the Loans (with a
corresponding reduction in the Total Commitments) and the 364-Day Loans
and (e) with respect to all amounts prepaid pursuant to Section 2.13.3,
pro rata to the Loans and the 364-Day Loans. All prepayments made to
the Loans pursuant to Sections 2.13.2, 2.13.3 and 2.13.4 shall be
applied first to the Revolving Credit Loans until paid in full and then
to the Swingline Loans and (after all Loans have been repaid) to a cash
collateral account in respect of LOC Obligations (with a corresponding
reduction in the Total Commitments with respect to any prepayment
pursuant to Sections 2.13.2 or 2.13.4) until paid in full; provided,
that, with respect to any prepayment pursuant to Section 2.13.3, so
long as no Default or Event
33
of Default exists, the Borrower shall not be required to cash
collateralize the LOC Obligations outstanding as of the date of such
prepayment provided that the Total Commitments as of the date of such
prepayment exceed the amount of such LOC Obligations outstanding.
Within the parameters of the application set forth above, prepayments
shall be applied first to Base Rate Loans and then to LIBOR Loans in
direct order of Interest Period maturities. All prepayments under this
Section 2.13 shall be subject to Section 2.11.3 and accompanied by
interest on the principal amount prepaid through the date of
prepayment.
2.14 REDUCTION OF COMMITMENT.
2.14.1 Voluntary Reduction. The Borrower shall have the right
permanently to reduce the amount of the Total Commitments, at any time
and from time to time, in any amount of at least $5,000,000.00 and in
an integral multiple of $1,000,000.00, which reduction shall reduce
each Lender's Commitment on a Pro Rata basis; provided, that, no such
termination or reduction shall be made which would cause the sum of the
aggregate principal amount of outstanding Revolving Credit Loans plus
the aggregate principal amount of outstanding Swingline Loans plus the
aggregate amount of LOC Obligations outstanding to exceed the aggregate
amount of the Total Commitments. Any reduction by the Borrower shall
take effect on a date specified in a written notice to the Agent that
is at least ten (10) Business Days after the date the Agent receives
such notice. Upon any reduction, the Borrower shall immediately pay the
Agent any breakage costs or other such charges due under other
provisions of this Agreement as a result of the early payment of any
LIBOR Loan in connection with the reduction of the Total Commitments.
Following such reduction, the nonusage fee provided for in Section
2.15.1 shall be calculated with respect to the Total Commitments as so
reduced from the effective date of the reduction.
2.14.2 Mandatory Reductions. The Total Commitments
automatically shall be permanently reduced from time to time in
accordance with the terms of Section 2.13.
2.14.3 Maturity Date. Unless terminated sooner pursuant to
Section 2.14.1 or Section 8.2.2, the Commitments of the Lenders and the
LOC Commitment of the Issuing Lender shall automatically terminate on
the Maturity Date.
2.15 FEES.
2.15.1 Commitment Fee. The Borrower shall pay to the Agent for
distribution to the Lenders Pro Rata an additional commitment fee on
the Unused Revolving Commitments, such fee to accrue beginning on the
date that Agent confirms in writing that all conditions to the initial
advance provided under Section 3.1 of this Agreement have been
satisfied or waived. This fee shall be determined by applying the
Applicable Commitment Fee (applied on the basis of a 360-day year) to
the Unused Revolving Commitments (advances under the Swingline
Commitment shall not be regarded as "used" for the purpose of
determining usage of the Revolving Credit Loans). The
34
commitment fee shall be paid in arrears on each Interest Payment Date
applicable to Base Rate Loans. This commitment fee is not refundable.
2.15.2 Letter of Credit Fee. In consideration of the issuance
of standby Letters of Credit hereunder, the Borrower promises to pay to
the Agent for distribution to the Lenders Pro Rata a fee (the "Letter
of Credit Fee") with respect to the Letters of Credit. The fee shall be
determined by applying the Applicable Letter of Credit Fee (applied on
the basis of a 360-day year) to the average daily maximum amount
available to be drawn under each such standby Letter of Credit computed
at a per annum rate for each day from the date of issuance to the date
of expiration (other than the Existing Letter of Credit, for which the
Applicable Letter of Credit Fee shall be computed at a per annum rate
for each day from the Closing Date to the date of expiration). The
Letter of Credit Fee will be payable quarterly in arrears on the last
Business Day of each March, June, September and December for the
immediately preceding quarter (or a portion thereof).
2.15.3 Issuing Lender Fees. In addition to the Letter of
Credit Fee payable pursuant to Section 2.15.2, the Borrower promises to
pay to the Agent for the account of the Issuing Lender without sharing
by the other Lenders (i) a letter of credit fronting fee of 1/8% on the
average daily maximum amount available to be drawn under each Letter of
Credit computed at a per annum rate for each day from the date of
issuance to the date of expiration (which fronting fee shall be payable
quarterly in arrears on the last Business Day of each March, June,
September and December for the immediately preceding quarter (or a
portion thereof)) and (ii) the customary charges from time to time of
the Issuing Lender with respect to the issuance, amendment, transfer,
administration, cancellation and conversion of, and drawings under,
such Letters of Credit.
2.16 SWINGLINE LOANS.
The Swingline Lender hereby agrees to extend to the Borrower Swingline
Loans in the aggregate amount not to exceed Ten Million and No/100 Dollars
($10,000,000.00), on the following terms and conditions.
2.16.1 Use of Proceeds of Swingline Loans. The Borrower may
use the proceeds of Swingline Loans for working capital purposes.
2.16.2 Swingline Note. The Swingline Loans shall be evidenced
by the Swingline Note.
2.16.3 Funding of Swingline Loans Advanced Pursuant to
Borrowing Notices.
2.16.3(a) Applicability. Except for Swingline Loans
made pursuant to Account Agreements as provided in Section
2.16.4 hereof, the funding of Swingline Loans shall be subject
to this Section 2.16.3.
35
2.16.3(b) Borrowing Notices. As long as the Borrower
meets the conditions for funding stated in this Agreement, the
Borrower may submit requests for Swingline Loans ("Swingline
Borrowing Notices") to the Swingline Lender. The Borrower
shall request a Swingline Loan borrowing by written notice (or
telephonic notice promptly confirmed in writing) to the
Swingline Lender (with a copy to the Agent) not later than
1:00 p.m. (Charlotte, North Carolina time) on the Business Day
of the requested borrowing. Each such request shall be
irrevocable and shall specify (i) that a Swingline Loan is
requested, (ii) the date of the requested borrowing (which
shall be a Business Day) and (iii) the aggregate principal
amount to be borrowed. Swingline Borrowing Notices shall be in
such form as the Swingline Lender may from time to time
require.
2.16.3(c) Funding of Swingline Loans. The Swingline
Lender shall initiate the transfer of funds representing the
Swingline Loan advance to the Borrower by 3:00 p.m.
(Charlotte, North Carolina time) on the Business Day of the
requested borrowing. All funds shall be disbursed directly
into an account maintained by the Borrower with the Swingline
Lender.
2.16.3(d) Minimum Amounts for Swingline Loans. Each
Swingline Loan shall be in a minimum amount of $250,000.00
each and in multiples of $50,000.00.
2.16.4 Funding of Swingline Loans Advanced Pursuant to Cash
Management Accounts. The Borrower may have in effect from time to time
separate agreements with the Swingline Lender or its affiliates
("Account Agreements") establishing cash management procedures that may
involve the automatic disbursement and/or repayment of Swingline Loans.
The Account Agreements may be established using standardized forms that
do not address the specific circumstances of the Swingline Loan. To
resolve potential inconsistencies between this Agreement and Account
Agreements, the terms of this Agreement and of Account Agreements shall
relate to one another as follows:
2.16.4(a) Funding and Payment Procedures Controlled
by Account Agreements. The Account Agreements shall control
this Agreement as to (i) Section 2.16.3 hereof regarding
funding procedures, and (ii) Interest Payment Dates, to the
extent that an Account Agreement may provide for such payment
more frequently than otherwise required under this Agreement.
2.16.4(b) Certain Provisions Controlled by this
Agreement. Notwithstanding any provision of an Account
Agreement to the contrary, except as provided above in Section
2.16.4(a) hereof, the provisions of this Agreement shall
control any Account Agreement to the extent that an Account
Agreement may be inconsistent with this Agreement.
2.16.4(c) Continuing Warranty Under Account
Agreements. Because Account Agreements may provide for the
making of Swingline Loans
36
without formal draw requests from the Borrower, the Borrower
agrees that the Borrower's warranty under Section 2.16.5
hereof as to the satisfaction of all conditions to the right
to receive Swingline Loans shall be a continuing one during
any period that such an Account Agreement may be in effect.
Therefore, any Swingline Loans funded by the Swingline Lender
pursuant to an Account Agreement after the failure of a
condition stated in Article III hereof shall be deemed made
upon the affirmative misrepresentation of the Borrower unless
the Swingline Lender has received written notice of and waived
the failed condition in writing.
2.16.5 Implied Representations Upon Request for Swingline
Loan. Upon making any request for a Swingline Loan, the Borrower shall
be deemed to have represented to the Swingline Lender that all
conditions to funding are satisfied as of the submission of the request
to the Swingline Lender.
2.16.6 Advance Not Waiver. The Swingline Lender's making of
any Swingline Loan that it is not obligated to make under any provision
of Article III hereof or any other provision hereof shall not be
construed as a waiver of the Swingline Lender's right to withhold
future Swingline Loans, notify the Agent of an Event of Default, or
otherwise demand strict compliance with this Agreement.
2.16.7 Interest. Interest shall be charged and paid on each
Swingline Loan as follows:
2.16.7(a) Rate of Interest. Interest shall accrue on
Swingline Loans at an annual rate equal to the Adjusted Base
Rate plus the Applicable Base Rate Margin, said rate to change
contemporaneously with any change in the Adjusted Base Rate or
the Applicable Base Rate Margin.
2.16.7(b) Calculation of Interest. Interest shall be
computed on the basis of a 360-day year counting the actual
number of days elapsed.
2.16.7(c) Payment of Interest. Interest shall be due
and payable in arrears without notice on each Interest Payment
Date.
2.16.7(d) Default Rate. Notwithstanding the
foregoing, upon the occurrence of an Event of Default and
during the continuation of such Event of Default until it is
cured or waived, interest shall be charged at the Default
Rate, regardless of whether the Swingline Lender has elected
to exercise any other remedies available to it, including,
without limitation, acceleration of the maturity of the
outstanding principal of the Swingline Loans.
2.16.8 Repayment of Principal. All remaining principal,
interest and expenses outstanding under the Swingline Loans shall
become due in full on the Maturity Date or the earlier acceleration of
the Revolving Credit Loans in accordance with the terms of this
Agreement (unless required to be repaid by the Swingline Lender
pursuant to the
37
terms of Section 2.16.9 below). The Borrower may at any time prepay any
outstanding Swingline Loans in whole or in part without premium or
penalty.
2.16.9 Procedures Among the Lenders. The Borrower agrees to
repay all Swingline Loans within one Business Day of demand therefor by
the Swingline Lender. Each repayment of a Swingline Loan may be
accomplished by requesting Revolving Credit Loans which request is not
subject to the conditions set forth in Section 3.2. In the event that
the Borrower shall fail to timely repay any Swingline Loan, and in any
event upon (i) request by the Swingline Lender, (ii) the occurrence of
an Event of Default described in Section 8.1.7 or (iii) the
acceleration of any Loan or termination of any Commitment pursuant to
Section 8.2.2, each other Lender shall irrevocably and unconditionally
require from the Swingline Lender without recourse or warranty, an
undivided participation interest in the outstanding Swingline Loans as
necessary to cause each Lender to own a Pro Rata interest in the
outstanding Swingline Loans by directly purchasing a participation in
the outstanding Swingline Loans in such amount (regardless of whether
the conditions precedent thereto set forth in Section 3.2 are then
satisfied, whether or not the Borrower has submitted a Borrowing Notice
and whether or not the Commitments are then in effect, any Event of
Default exists or all the Loans have been accelerated) and paying the
proceeds thereto to the Swingline Lender at the address provided in
Section 10.1, or at such other address as the Swingline Lender may
designate, in Dollars and in immediately available funds. If such
amount is not in fact made available to the Swingline Lender by any
Lender, the Swingline Lender shall be entitled to recover such amount
on demand from such Lender, together with accrued interest thereon for
each day from the date of demand thereof, at the Federal Funds Rate. If
such Lender does not pay such amount forthwith upon the Swingline
Lender's demand therefor, and until such time as such Lender makes the
required payment, the Swingline Lender shall be deemed to continue to
have outstanding Swingline Loans in the amount of such unpaid
participation obligation for all purposes of the Loan Documents other
than those provisions requiring the other Lenders to purchase a
participation therein. Further, such Lender shall be deemed to have
assigned any and all payments made of principal and interest on its
Loans, and any other amounts due to it hereunder to the Swingline
Lender to fund Swingline Loans in the amount of the participation in
Swingline Loans that such Lender failed to purchase pursuant to this
Section 2.16.9 until such amount has been purchased (as a result of
such assignment or otherwise).
2.17 LETTER OF CREDIT SUBFACILITY.
2.17.1 Issuance. Subject to the terms and conditions hereof
and in reliance upon the representations and warranties set forth
herein, the Issuing Lender agrees to issue, and each Lender severally
agrees to participate in the issuance by the Issuing Lender of, standby
Letters of Credit in Dollars from time to time from the Closing Date
until the date thirty (30) days prior to the Maturity Date as the
Borrower may request, in a form acceptable to the Issuing Lender;
provided, however, that (i) the LOC Obligations outstanding shall not
at any time exceed TWENTY MILLION DOLLARS ($20,000,000) (the "LOC
Committed Amount"). No Letter of Credit shall (x) have an original
expiry date more than one year from the date of issuance or (y) as
originally issued or as extended, have an expiry date
38
extendingbeyond the date thirty (30) days prior to the Maturity Date.
Each Letter of Credit shall comply with the related LOC Documents. The
issuance and expiry dates of each Letter of Credit shall be a Business
Day.
2.17.2 Notice and Reports. The request for the issuance of a
Letter of Credit shall be submitted by the Borrower to the Issuing
Lender at least three (3) Business Days prior to the requested date of
issuance. The Issuing Lender will, at least quarterly and more
frequently upon request, disseminate to each of the Lenders a detailed
report specifying the Letters of Credit which are then issued and
outstanding and any activity with respect thereto which may have
occurred since the date of the prior report, and including therein,
among other things, the beneficiary, the face amount and the expiry
date, as well as any payment or expirations which may have occurred.
2.17.3 Participation.
(i) Each Lender acknowledges and confirms that it has
a Participation Interest in the liability of the Issuing
Lender under each Existing Letter of Credit in an amount equal
to its Commitment Percentage of such Existing Letters of
Credit. The Borrower's reimbursement obligations in respect of
each Existing Letter of Credit, and each Lender's obligations
in connection therewith, shall be governed by the terms of
this Agreement.
(ii) Each Lender, upon issuance of a Letter of
Credit, shall be deemed to have purchased without recourse a
Participation Interest from the Issuing Lender in such Letter
of Credit and the obligations arising thereunder and any
collateral relating thereto, in each case in an amount equal
to its pro rata share of the obligations under such Letter of
Credit (based on the respective Commitment Percentages of the
Lenders) and shall absolutely, unconditionally and irrevocably
assume and be obligated to pay to the Issuing Lender and
discharge when due, its pro rata share of the obligations
arising under such Letter of Credit. Without limiting the
scope and nature of each Lender's Participation Interest in
any Letter of Credit, to the extent that the Issuing Lender
has not been reimbursed as required hereunder or under any
such Letter of Credit, each such Lender shall pay to the
Issuing Lender its pro rata share of such unreimbursed drawing
in same day funds on the day of notification by the Issuing
Lender of an unreimbursed drawing pursuant to the provisions
of Section 2.17.4. The obligation of each Lender to so
reimburse the Issuing Lender shall be absolute and
unconditional and shall not be affected by the occurrence of a
Default, an Event of Default or any other occurrence or event.
Any such reimbursement shall not relieve or otherwise impair
the obligation of the Borrower to reimburse the Issuing Lender
under any Letter of Credit, together with interest as
hereinafter provided.
2.17.4 Reimbursement. In the event of any drawing under any
Letter of Credit, the Issuing Lender will promptly notify the Borrower.
Unless the Borrower shall immediately notify the Issuing Lender that
the Borrower intends to otherwise reimburse the Issuing Lender for such
drawing, the Borrower shall be deemed to have requested that the
Lenders
39
make a Revolving Credit Loan in the amount of the drawing as provided
in Section 2.17.5 on the related Letter of Credit, the proceeds of
which will be used to satisfy the related reimbursement obligations.
The Borrower promises to reimburse the Issuing Lender on the day of
drawing under any Letter of Credit (either with the proceeds of a
Revolving Credit Loan obtained hereunder or otherwise) in same day
funds. If the Borrower shall fail to reimburse the Issuing Lender as
provided hereinabove, the Borrower promises to pay the Issuing Lender
interest on the unreimbursed amount of such drawing on demand at a per
annum rate equal to two percent (2%) over the Alternate Base Rate plus
the Applicable Base Rate Margin. The Borrower's reimbursement
obligations hereunder shall be absolute and unconditional under all
circumstances irrespective of any rights of setoff, counterclaim or
defense to payment the Borrower may claim or have against the Issuing
Lender, the Agent, the Lenders, the beneficiary of the Letter of Credit
drawn upon or any other Person, including without limitation any
defense based on any failure of the Borrower or any other Credit Party
to receive consideration or the legality, validity, regularity or
unenforceability of the Letter of Credit. The Issuing Lender will
promptly notify the other Lenders of the amount of any unreimbursed
drawing and each Lender shall promptly pay to the Agent for the account
of the Issuing Lender in Dollars and in immediately available funds,
the amount of such Lender's pro rata share of such unreimbursed
drawing. Such payment shall be made on the day such notice is received
by such Lender from the Issuing Lender if such notice is received at or
before 2:00 P.M. (Charlotte, North Carolina time), and otherwise such
payment shall be made at or before 12:00 Noon (Charlotte, North
Carolina time) on the Business Day next succeeding the day such notice
is received. If such Lender does not pay such amount to the Issuing
Lender in full upon such request, such Lender shall, on demand, pay to
the Agent for the account of the Issuing Lender interest on the unpaid
amount during the period from the date of such drawing until such
Lender pays such amount to the Issuing Lender in full at a rate per
annum equal to, if paid within two (2) Business Days of the date that
such Lender is required to make payments of such amount pursuant to the
preceding sentence, the Federal Funds Rate and thereafter at a rate
equal to the Base Rate. Each Lender's obligation to make such payment
to the Issuing Lender, and the right of the Issuing Lender to receive
the same, shall be absolute and unconditional, shall not be affected by
any circumstance whatsoever and without regard to the termination of
this Credit Agreement or the Commitments hereunder, the existence of a
Default or Event of Default or the acceleration of the obligations of
the Borrower hereunder and shall be made without any offset, abatement,
withholding or reduction whatsoever. Simultaneously with the making of
each such payment by a Lender to the Issuing Lender, such Lender shall,
automatically and without any further action on the part of the Issuing
Lender or such Lender, acquire a Participation Interest in an amount
equal to such payment (excluding the portion of such payment
constituting interest owing to the Issuing Lender) in the related
unreimbursed drawn portion of the LOC Obligation and in the interest
thereon and in the related LOC Documents, and shall have a claim
against the Borrower with respect thereto.
2.17.5 Repayment with Revolving Credit Loans. On any day on
which the Borrower shall have requested, or been deemed to have
requested, a Revolving Credit Loan advance to reimburse a drawing under
a Letter of Credit, the Agent shall give notice to the Lenders that a
Revolving Credit Loan has been requested or deemed requested by the
Borrower to be made in connection with a drawing under a Letter of
Credit, in which case a
40
Revolving Credit Loan advance comprised of Base Rate Loans (or LIBOR
Loans to the extent the Borrower has complied with the procedures of
Section 2.5 with respect thereto) shall be immediately made to the
Borrower by all Lenders (notwithstanding any termination of the
Commitments pursuant to Section 8.2.2) pro rata based on the respective
Commitment Percentages of the Lenders (determined before giving effect
to any termination of the Commitments pursuant to Section 8.2.2) and
the proceeds thereof shall be paid directly to the Issuing Lender for
application to the respective LOC Obligations. Each such Lender hereby
irrevocably agrees to make its pro rata share of each such Revolving
Credit Loan immediately upon any such request or deemed request in the
amount, in the manner and on the date specified in the preceding
sentence notwithstanding (i) the amount of such borrowing may not
comply with the minimum amount for advances of Revolving Credit Loans
otherwise required hereunder, (ii) whether any conditions specified in
Section 3.2 are then satisfied, (iii) whether a Default or an Event of
Default then exists, (iv) failure for any such request or deemed
request for Revolving Credit Loan to be made by the time otherwise
required hereunder, (v) whether the date of such borrowing is a date on
which Revolving Credit Loans are otherwise permitted to be made
hereunder or (vi) any termination of the Commitments relating thereto
immediately prior to or contemporaneously with such borrowing. In the
event that any Revolving Credit Loan cannot for any reason be made on
the date otherwise required above (including, without limitation, as a
result of the commencement of a proceeding under the Bankruptcy Code
with respect to the Borrower or any other Credit Party), then each such
Lender hereby agrees that it shall forthwith purchase (as of the date
such borrowing would otherwise have occurred, but adjusted for any
payments received from the Borrower on or after such date and prior to
such purchase) from the Issuing Lender such Participation Interests in
the outstanding LOC Obligations as shall be necessary to cause each
such Lender to share in such LOC Obligations ratably (based upon the
respective Commitment Percentages of the Lenders (determined before
giving effect to any termination of the Commitments pursuant to Section
8.2.2)), provided that at the time any purchase of Participation
Interests pursuant to this sentence is actually made, the purchasing
Lender shall be required to pay to the Issuing Lender, to the extent
not paid to the Issuing Lender by the Borrower in accordance with the
terms of subsection (d) above, interest on the principal amount of
Participation Interests purchased for each day from and including the
day upon which such borrowing would otherwise have occurred to but
excluding the date of payment for such Participation Interests, at the
rate equal to, if paid within two (2) Business Days of the date of the
Revolving Credit Loan advance, the Federal Funds Rate, and thereafter
at a rate equal to the Base Rate.
2.17.6 Designation of Borrower Entities as Account Parties.
Notwithstanding anything to the contrary set forth in this Agreement,
including without limitation Section 2.17.1, a Letter of Credit issued
hereunder may contain a statement to the effect that such Letter of
Credit is issued for the account of any Subsidiary of the Borrower,
provided that notwithstanding such statement, the Borrower shall be the
actual account party for all purposes of this Agreement for such Letter
of Credit and such statement shall not affect the Borrower's
reimbursement obligations hereunder with respect to such Letter of
Credit.
41
2.17.7 Renewal, Extension. The renewal or extension of any
Letter of Credit shall, for purposes hereof, be treated in all respects
the same as the issuance of a new Letter of Credit hereunder.
2.17.8 Uniform Customs and Practices. The Issuing Lender may
have the Letters of Credit be subject to The Uniform Customs and
Practice for Documentary Credits (the "UCP") or the International
Standby Practices 1998 (the "ISP98"), in either case as published as of
the date of issue by the International Chamber of Commerce, in which
case the UCP or the ISP98, as applicable, may be incorporated therein
and deemed in all respects to be a part thereof.
2.17.9 Indemnification; Nature of Issuing Lender's Duties.
(i) In addition to its other obligations under this
Section 2.17, the Borrower hereby agrees to pay, and protect,
indemnify and save each Lender harmless from and against, any
and all claims, demands, liabilities, damages, losses, costs,
charges and expenses (including reasonable attorneys' fees)
that such Lender may incur or be subject to as a consequence,
direct or indirect, of (A) the issuance of any Letter of
Credit or (B) the failure of such Lender to honor a drawing
under a Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure
or de facto government or Governmental Authority (all such
acts or omissions, herein called "Government Acts").
(ii) As between the Borrower and the Lenders
(including the Issuing Lender), the Borrower shall assume all
risks of the acts, omissions or misuse of any Letter of Credit
by the beneficiary thereof. No Lender (including the Issuing
Lender) shall be responsible: (A) for the form, validity,
sufficiency, accuracy, genuineness or legal effect of any
document submitted by any party in connection with the
application for and issuance of any Letter of Credit, even if
it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (B) for the
validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign any Letter of
Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part, that may prove to be invalid or
ineffective for any reason; (C) for errors, omissions,
interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex or otherwise,
whether or not they be in cipher; (D) for any loss or delay in
the transmission or otherwise of any document required in
order to make a drawing under a Letter of Credit or of the
proceeds thereof; and (E) for any consequences arising from
causes beyond the control of such Lender, including, without
limitation, any Government Acts. None of the above shall
affect, impair, or prevent the vesting of the Issuing Lender's
rights or powers hereunder.
(iii) In furtherance and extension and not in
limitation of the specific provisions hereinabove set forth,
any action taken or omitted by any Lender (including the
Issuing Lender), under or in connection with any Letter of
Credit or the related certificates, if taken or omitted in
good faith, shall not put such Lender
42
under any resulting liability to the Borrower or any other
Credit Party. It is the intention of the parties that this
Agreement shall be construed and applied to protect and
indemnify each Lender (including the Issuing Lender) against
any and all risks involved in the issuance of the Letters of
Credit, all of which risks are hereby assumed by the Borrower
(on behalf of itself and each of the other Credit Parties),
including, without limitation, any and all Government Acts. No
Lender (including the Issuing Lender) shall, in any way, be
liable for any failure by such Lender or anyone else to pay
any drawing under any Letter of Credit as a result of any
Government Acts or any other cause beyond the control of such
Lender.
(iv) Nothing in this Section 2.17.9 is intended to
limit the reimbursement obligations of the Borrower contained
in Section 2.17.4 above. The obligations of the Borrower under
this Section 2.17.9 shall survive the termination of this
Agreement. No act or omission of any current or prior
beneficiary of a Letter of Credit shall in any way affect or
impair the rights of the Lenders (including the Issuing
Lender) to enforce any right, power or benefit under this
Agreement.
(v) Notwithstanding anything to the contrary
contained in this Section 2.17.9, the Borrower shall have no
obligation to indemnify any Lender (including the Issuing
Lender) in respect of any liability incurred by such Lender
(A) arising solely out of the gross negligence or willful
misconduct of such Lender, as determined by a court of
competent jurisdiction, or (B) caused by such Lender's failure
to pay under any Letter of Credit after presentation to it of
a request strictly complying with the terms and conditions of
such Letter of Credit, as determined by a court of competent
jurisdiction, unless such payment is prohibited by any law,
regulation, court order or decree.
2.17.10 Responsibility of Issuing Lender. It is expressly
understood and agreed that the obligations of the Issuing Lender
hereunder to the Lenders are only those expressly set forth in this
Agreement and that the Issuing Lender shall be entitled to assume that
the conditions precedent set forth in Section 3.2 have been satisfied
unless it shall have acquired actual knowledge that any such condition
precedent has not been satisfied; provided, however, that nothing set
forth in this Section 2.17 shall be deemed to prejudice the right of
any Lender to recover from the Issuing Lender any amounts made
available by such Lender to the Issuing Lender pursuant to this Section
2.17 in the event that it is determined by a court of competent
jurisdiction that the payment with respect to a Letter of Credit
constituted gross negligence or willful misconduct on the part of the
Issuing Lender.
2.17.11 Conflict with LOC Documents. In the event of any
conflict between this Agreement and any LOC Document (including any
letter of credit application), this Agreement shall control.
2.18 PAYMENTS.
Except as otherwise specifically provided herein, all payments
hereunder shall be made to the Agent in Dollars in immediately
available funds, without condition or deduction
43
for any counterclaim, defense, recoupment or setoff of any kind, at the
Agent's office specified in Section 10.1 not later than 2:00 P.M.
(Charlotte, North Carolina time) on the date when due. Payments
received after such time shall be deemed to have been received on the
next succeeding Business Day. The Agent may (but shall not be obligated
to) debit the amount of any such payment which is not made by such time
to any ordinary deposit account of the Borrower or any other Credit
Party maintained with the Agent (with notice to the Borrower or such
other Credit Party). The Borrower shall, at the time it makes any
payment under this Credit Agreement, specify to the Agent the Loans,
LOC Obligations, fees, interest or other amounts payable by the
Borrower hereunder to which such payment is to be applied (and in the
event that it fails so to specify, or if such application would be
inconsistent with the terms hereof, the Agent shall distribute such
payment to the Lenders in such manner as the Agent may determine to be
appropriate in respect of obligations owing by the Borrower hereunder,
subject to the terms of Section 9.5). The Agent will distribute such
payments to such Lenders, if any such payment is received prior to 2:00
P.M. (Charlotte, North Carolina time) on a Business Day in like funds
as received prior to the end of such Business Day and otherwise the
Agent will distribute such payment to such Lenders on the next
succeeding Business Day. Whenever any payment hereunder shall be stated
to be due on a day which is not a Business Day, the due date thereof
shall be extended to the next succeeding Business Day (subject to
accrual of interest and fees for the period of such extension), except
that in the case of LIBOR Loans, if the extension would cause the
payment to be made in the next following calendar month, then such
payment shall instead be made on the next preceding Business Day.
III. CONDITIONS PRECEDENT
3.1 CLOSING CONDITIONS.
The obligations of the Lenders to enter into this Agreement shall be
subject to the satisfaction of the following conditions:
3.1.1 Loan Documents. The Borrower shall have delivered to the
Agent the following documents, fully executed and in form and substance
acceptable to the Agent and the Lenders:
3.1.1(a) Loan Agreement. This Agreement.
3.1.1(b) Revolving Credit Notes. The Revolving Credit
Notes issued by the Borrower payable to the order of each of
the respective Lenders in the maximum principal amounts of the
Lenders' respective Commitments.
3.1.1(c) Swingline Note. The Swingline Note issued by
the Borrower payable to the order of the Swingline Lender in
the maximum principal amount of the Swingline Commitment.
44
3.1.1(d) Guaranty Agreement. The Guaranty Agreement
executed by all wholly-owned Subsidiaries of the Borrower.
3.1.1(e) Pledge of Equity Interests. The Security
Agreement, irrevocable proxies, blank stock powers, original
stock certificates and financing statements deemed necessary
by the Collateral Agent.
3.1.1(f) Pledge of Inter-Company Notes. The
Collateral Assignment granting to the Collateral Agent a first
priority perfected security interest in all Inter-Company
Notes, together with the original Promissory Notes evidencing
those obligations, endorsed payable to the order of the
Collateral Agent.
3.1.1(g) Charters. Copies of the articles of
incorporation or other charter documents of each Credit Party
certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state or other
jurisdiction of its incorporation or organization and
certified by a secretary or assistant secretary of such Credit
Party to be true and correct as of the Closing Date.
3.1.1(h) Bylaws. Copies of Bylaws, operating
agreements and other constituent and organizational documents
of each Credit Party certified by a secretary or assistant
secretary of such Credit Party to be true and correct as of
the Closing Date.
3.1.1(i) Certificates of Good Standing. Copies of
certificates of good standing or existence, as applicable with
respect to each Credit Party certified as of a recent date by
the appropriate Governmental Authorities of the state or other
jurisdiction of incorporation or organization.
3.1.1(j) Resolutions. Copies of resolutions for each
Credit Party approving and adopting the Loan Documents to
which it is a party, the transactions contemplated therein and
authorizing execution and delivery thereof, certified by a
secretary or assistant secretary of such Person to be true and
correct and in force and effect as of the Closing Date.
3.1.1(k) Incumbency. An incumbency certificate of
each Credit Party certified by a secretary or assistant
secretary to be true and correct as of the Closing Date.
3.1.1(l) Consents. Written evidence of the final
issuance of any necessary consents of Governmental Authorities
or other third parties to the execution, delivery and
performance of all Credit Parties under the Loan Documents.
45
3.1.1(m) Opinions of the Borrower's Counsel. Opinions
of counsel with respect to the Borrower and those Subsidiaries
identified on Schedule 3.1.1 in form and substance
satisfactory to the Agent dated as of the Closing Date from
counsel to the Credit Parties.
3.1.1(n) UCC Searches. Searches of the Uniform
Commercial Code filings in the state of incorporation or
organization of the Borrower. Duly executed UCC financing
statements for each appropriate jurisdiction as is necessary
to perfect the Collateral Agent's security interest in the
Collateral.
3.1.1(o) Payment of Fees and Expenses. Payment by the
Borrower to the Lenders and the Agent of all fees and expenses
which are due and payable on the Closing Date.
3.1.1(p) Officer's Certificate. The Agent shall have
received a certificate or certificates executed by an
executive officer of the Borrower dated as of the Closing
Date, in form and substance satisfactory to the Agent, stating
that (A) each Credit Party is in compliance with all existing
material financial obligations, (B) all governmental,
shareholder and third party consents and approvals, if any,
with respect to the Loan Documents and the transactions
contemplated thereby have been obtained, (C) no action, suit,
investigation or proceeding is pending or threatened in any
court or before any arbitrator or governmental instrumentality
that purports to affect any Borrower Entity or any transaction
contemplated by the Credit Documents, if such action, suit,
investigation or proceeding could have a Material Adverse
Effect and (D)(1) no Default or Event of Default exists and
(2) all representations and warranties contained herein and in
the other Loan Documents are true and correct in all material
respects.
3.1.1(q) Other Documents. Such other documents as the
Agent may reasonably require.
3.1.2 Additional Conditions. The Borrower shall have
satisfied the following additional conditions:
3.1.2(a) Warranties. All representations and
warranties set forth in the Loan Documents are true and
correct in all material respects and shall be true and correct
in all material respects taking into account the funding of
the requested Loan.
3.1.2(b) Covenants. All covenants made in the Loan
Documents must have been complied with in all material
respects and shall have been complied with, taking into
account the funding of the requested Loan.
3.1.2(c) Absence of Default. No Default or Event of
Default shall exist under this Agreement.
46
3.1.2(d) No Adverse Change. There must be no Material
Adverse Change since December 31, 2001.
3.1.2(e) Financial Information. The Agent and the
Lenders shall have received such financial information
relating to the Borrower Entities as the Agent and the Lenders
may reasonably require (including without limitation the
Financial Statements).
3.1.2(f) Absence of Litigation. There must be no
action, suit, proceeding or investigation against any Borrower
Entity before or through any Governmental Authority which, if
adversely determined, would likely have a Material Adverse
Effect.
3.2 CONDITIONS TO ALL LOANS AND ISSUANCES.
The Lenders shall not be obligated to make any Loan, the Issuing Lender
shall not be obligated to issue or extend any Letter of Credit, and the
Swingline Lender shall not be obligated to advance any Swingline Loans
(including the initial advance), unless all of the following conditions are
satisfied as of the time of the request and of funding or issuance:
3.2.1 Conditions to Initial Advance. All of the conditions in
Section 3.1 hereof must have been satisfied as of the date of the
initial advance hereunder.
3.2.2 Warranties. All representations and warranties made in
the Loan Documents must be true in all material respects as of such
date (except for those which expressly relate to an earlier date).
3.2.3 Covenants. All covenants made in the Loan Documents must
have been complied with in all material respects and shall have been
complied with in all material respects taking into account the funding
of the requested Loan.
3.2.4 Absence of Default. No Default or Event of Default shall
exist and be continuing either prior to or after giving effect to the
requested Loan.
3.2.5 Material Adverse Change. There shall not have occurred a
Material Adverse Change since the Borrower's most recent fiscal
year-end.
3.2.6 Commitments. Immediately after giving effect to the
making of such Loan (and the application of the proceeds thereof) or to
the issuance of such Letter of Credit, as the case may be, (i) the sum
of the aggregate outstanding principal amount of Revolving Credit Loans
plus Swingline Loans plus LOC Obligations shall not exceed the
aggregate amount of the Total Commitments and (ii) the LOC Obligations
shall not exceed the LOC Committed Amount.
47
The delivery of each Borrowing Notice and each request for a Letter of
Credit pursuant to Section 2.17 shall constitute a representation and warranty
by the Borrower of the correctness of the matters specified in Section 3.2.2,
3.2.3, 3.2.4, 3.2.5 and 3.2.6 above.
IV. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders and the Agent that:
4.1 CAPACITY.
Each Borrower Entity is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or
organization. Each Borrower Entity is qualified or authorized to do business in
all jurisdictions in which its ownership of property or conduct of business
requires such qualification or authorization or where thc failure to be so
qualified or authorized would not have a Material Adverse Effect. Each Borrower
Entity has the power and authority to own its Properties and to carry on its
business as now being conducted and as proposed to be conducted after the
execution hereof, to execute and deliver this Agreement and the other Loan
Documents, and to perform its obligations hereunder and under the other Loan
Documents.
4.2 AUTHORIZATION.
The execution, delivery and performance of this Agreement and the other
Loan Documents by each Borrower Entity executing such documents has been duly
authorized by all requisite action.
4.3 BINDING OBLIGATIONS.
This Agreement and the other Loan Documents, when executed and
delivered to the Agent and the Lenders, will be, legal, valid and binding upon
each Borrower Entity who is a party thereto, enforceable in accordance with its
respective terms, subject only to principles of equity and laws applicable to
creditors generally, including bankruptcy laws.
4.4 NO CONFLICTING LAW OR AGREEMENT.
The execution, delivery and performance of this Agreement and the other
Loan Documents by each Borrower Entity does not constitute a breach of or
default under, and will not violate or conflict with, any provisions of the
corporate charter or other constituent documents of a Borrower Entity; any
contract, financing agreement, lease, or other agreement to which a Borrower
Entity is a party or by which its Properties may be affected, the violation of
which would have a Material Adverse Effect; or any Law to which a Borrower
Entity is subject or by which its Properties may be affected, the violation of
which would have a Material Adverse Effect; nor will the same result in the
creation or imposition of any Encumbrance upon any Property of any Borrower
Entity, other than those contemplated by the Loan Documents.
48
4.5 NO CONSENT REQUIRED.
The execution, delivery, and performance of this Agreement and the
other Loan Documents by the Borrower Entities do not require the consent or
approval of or the giving of notice to any Person except for those consents
which have been duly obtained and are in full force and effect on the date
hereof and others, if any, which by their omission would not result in a
Material Adverse Effect.
4.6 FINANCIAL STATEMENTS.
The Financial Statements and the financial statements delivered to the
Lenders pursuant to Section 5.3.1 and 5.3.2, are complete and correct, have been
prepared in accordance with GAAP, and present fairly the financial condition and
results of operations of the Borrower Entities as of the date and for the period
stated therein, subject to year-end adjustments. No Material Adverse Change has
occurred since December 31, 2001. The Borrower acknowledges that the Lenders
have advanced (or shall advance) the Revolving Credit Loans and the Swingline
Loans in reliance upon the Financial Statements.
4.7 FISCAL YEAR.
The Borrower's fiscal year ends on December 31 of each year.
4.8 LITIGATION.
There is no litigation, arbitration, legal or administrative
proceeding, tax audit, investigation, or other action or proceeding of any
nature pending against any Borrower Entity or any of its Properties which, if
adversely determined, would likely have a Material Adverse Effect, and there is
no litigation, arbitration, legal or administrative proceeding, tax audit,
investigation, or other action or proceeding of any nature threatened in writing
against a Borrower Entity which, if adversely determined, would have a Material
Adverse Effect. No Borrower Entity is subject to any outstanding court, arbitral
or administrative order, writ or injunction. To the best of the Borrower's
knowledge, information and belief, no facts exist under which third parties have
unasserted claims against any Borrower Entity which, if adversely determined,
would have a Material Adverse Effect.
4.9 TAXES; GOVERNMENTAL CHARGES.
Each Borrower Entity has filed or caused to be filed or has lawfully
extended the deadline for filing all tax returns and reports required to be
filed, other than those which, if not filed, would not have a Material Adverse
Effect. Each Borrower Entity has paid, or made adequate provision for the
payment of, all taxes, assessments and other governmental charges that have or
may have become due pursuant to such returns or otherwise, or pursuant to any
assessment received by it, except such taxes, etc., if any, as are being
contested in good faith by appropriate proceedings and for which adequate
reserves have been provided. To the best of the Borrower's knowledge, there is
no proposed material tax assessment against any Borrower Entity. No extension of
time for the assessment of federal, state or local taxes of any Borrower
49
Entity is in effect or has been requested. Each Borrower Entity has timely made
all required remittances of withholding deposits and other assessments against
payroll expenditures except for matters that would not have a Material Adverse
Effect.
4.10 TITLE TO PROPERTIES.
Each Borrower Entity has good and marketable title to its Properties,
free and clear of all Encumbrances except for Permitted Encumbrances.
4.11 NO DEFAULT.
No Borrower Entity is in default in any respect that affects its
business, Properties, operations, or condition, financial or otherwise, under
any indenture, mortgage, deed of trust, obligation to equity holders, credit
agreement, note, agreement, lease, sale agreement or other instrument to which
any Borrower Entity is a party or by which its Properties are bound, which
default would have a Material Adverse Effect. To the best of the Borrower's
knowledge, information and belief, no other party to any contract with any
Borrower Entity under which a default would have a Material Adverse Effect is in
default or breach thereof and no circumstances exist which, with the giving of
notice and/or the passing of time would constitute such default or breach. No
Default or Event of Default exists under this Agreement.
4.12 CASUALTIES; TAKING OF PROPERTIES.
Neither the business nor the Property of any Borrower Entity is
presently impaired as a result of any fire, explosion, earthquake, flood,
drought, windstorm, accident, strike or other labor disturbance, embargo,
requisition or taking of property, cancellation of contracts, permits,
concessions by any domestic or foreign government or any agency thereof, riot,
activities of armed forces or acts of God or of any public enemy, in any case as
would have a Material Adverse Effect.
4.13 COMPLIANCE WITH LAWS.
No Borrower Entity is in violation of any Law to which it, its business
or any of its Properties are subject, the violation of which would likely have a
Material Adverse Effect, and there are no outstanding citations, notices or
orders of noncompliance issued to any Borrower Entity under any such Law, the
violation of which would likely have a Material Adverse Effect. Each Borrower
Entity has obtained all licenses, permits, franchises, or other governmental
authorizations necessary to the ownership of its Properties or to the conduct of
its business, except for those which, if not obtained, would not have a Material
Adverse Effect.
4.14 COMPLIANCE WITH FRAUD AND ABUSE LAWS.
Without limiting any other provision of this Agreement, (a) no Borrower
Entity is in violation of any Fraud and Abuse Law, the violation of which would
have a Material Adverse Effect and (b) to the best knowledge of the Credit
Parties, no Provider is in violation of any Fraud and Abuse Law, the violation
of which would have a Material Adverse Effect.
50
4.15 ERISA.
No ERISA Event has occurred with respect to any Plan or is reasonably
expected to occur with respect to any Plan, except for those which, if not
obtained, would not have a Material Adverse Effect.
4.16 FULL DISCLOSURE OF MATERIAL FACTS.
The Borrower has fully advised the Agent of all matters involving the
financial condition, business, operations and Properties of the Borrower
Entities that would be reasonably expected to have a Material Adverse Effect. No
information, exhibit, or report furnished or to be furnished by the Borrower to
the Lenders in connection with this Agreement contains, as of the date thereof,
any misrepresentation of fact or failed or will fail to state any material fact,
the omission of which would render the statements therein materially false or
misleading.
4.17 INVESTMENT COMPANY ACT.
No Borrower Entity is an "investment company" registered or required to
be registered under the Investment Company Act of 1940, as amended, and is not
controlled by such a company.
4.18 HOLDING COMPANY.
No Borrower Entity is subject to regulation under the Public Utility
Holding Company Act of 1935 or the Federal Power Act. In addition, no Borrower
Entity is a "holding company", or a "subsidiary company" of a "holding company",
or an "affiliate" of a "holding company" or of a "subsidiary" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended. No Borrower Entity is a "personal holding company" as defined in
Section 542 of the IRC.
4.19 SOLVENCY.
The Credit Parties are Solvent on a consolidated basis.
4.20 SUBSIDIARIES.
Set forth on Schedule 4.20 is a complete and accurate list with respect
to the Borrower and each of its direct and indirect Subsidiaries of (i) number
of shares of each class of Capital Stock outstanding, (ii) number and percentage
of outstanding shares of each class owned (directly or indirectly) by the
Borrower Entities and (iii) number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and all other similar rights
with respect thereto. The outstanding Capital Stock of all such Persons is
validly issued, fully paid and non-assessable and is owned by the Borrower
Entities, directly or indirectly, in the manner set forth on Schedule 4.20, free
and clear of all Encumbrances (other than those arising under or contemplated in
connection with the Loan Documents). Other than as set forth in Schedule 4.20,
neither the
51
Borrower nor any of its Subsidiaries has outstanding any securities convertible
into or exchangeable for its Capital Stock nor does any such Person have
outstanding any rights to subscribe for or to purchase or any options for the
purchase of, or any agreements providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating to
its Capital Stock. Also set forth on Schedule 4.20 is the jurisdiction of
incorporation or formation of the Borrower and each of its Subsidiaries.
Schedule 4.20 may be updated from time to time by the Borrower by giving written
notice thereof to the Agent.
4.21 OWNERSHIP OF PATENTS, LICENSES, ETC.
The Borrower Entities own all licenses, permits, franchises,
registrations, patents, copyrights, trademarks, trade names or service marks, or
the rights to use the foregoing, that are necessary for the continued operation
of their business except for such licenses, permits, franchises, registrations,
patents, copyrights, trademarks, trade names or service marks, which, if not
held or owned, would not have a Material Adverse Effect.
4.22 ENVIRONMENTAL COMPLIANCE.
Each Borrower Entity has duly complied with, and their Properties are
owned and operated in compliance with, all Environmental Laws, the violation of
which would have a Material Adverse Effect. There have been no citations,
notices or orders of non-compliance issued to any Borrower Entity or, to the
best of the Borrower's knowledge, relating to their business or Properties
pursuant to any Environmental Law, except for those which would not have a
Material Adverse Effect. Each Borrower Entity has obtained all required federal,
state and local licenses, certificates or permits relating to them and their
Properties as required by applicable Environmental Laws, except for those which,
if not obtained, would not have a Material Adverse Effect.
4.23 LABOR MATTERS.
No Borrower Entity is subject to any collective bargaining agreements
or any decrees or orders requiring them to recognize, deal with or employ any
Person. No demand for collective bargaining has been asserted against any
Borrower Entity by any union or organization. No Borrower Entity has experienced
any strike, labor dispute, slowdown or work stoppage due to labor dispute and,
to the best knowledge of the Borrower, there is no such strike, dispute,
slowdown or work stoppage threatened against any Borrower Entity. All Borrower
Entities are in compliance in all material respects with the Fair Labor
Standards Act of 1938, as amended, except for those matters which would not have
a Material Adverse Effect.
4.24 OSHA COMPLIANCE.
All Borrower Entities are in compliance in all material respects with
the Federal Occupational Safety and Health Act, as amended, and all regulations
under the foregoing, except for those matters which would not have a Material
Adverse Effect.
52
4.25 REGULATIONS T, U AND X.
No Borrower Entity is engaged in the business of extending credit for
the purpose of purchasing or carrying margin stock (within the meaning of
Regulation U). No part of the Letters of Credit or proceeds of any Loan will be
used, directly or indirectly, in any manner that would constitute a violation of
Regulation T, Regulation U or Regulation X. Margin stock (within the meaning of
Regulation U) does not constitute more than 25% of the value of the consolidated
assets of the Borrower Entities.
4.26 INTER-COMPANY NOTES.
Set forth on Schedule 4.26 hereto is a complete list of all
Inter-Company Notes, and no other Inter-Company Notes are required to be in
existence under the requirement of Section 5.24 hereof. Schedule 4.26 may be
updated from time to time by the Borrower by written notice to the Agent.
V. AFFIRMATIVE COVENANTS
The Borrower hereby covenants and agrees that so long as this Agreement
is in effect or any amounts payable hereunder or under any other Loan Document
shall remain outstanding, and until all of the Commitments hereunder shall have
terminated (and thereafter where expressly stated herein):
5.1 PAYMENT OF OBLIGATIONS.
The Borrower shall pay all amounts owed under the Obligations when due
without setoff, counterclaim or withholdings of any kind; provided, however, if
the Borrower is required by law to withhold any taxes (other than taxes based
upon the income of the Lender imposed by the jurisdiction in which the Lender is
organized or from which its interest herein has been generated) from any
payments on the Obligations to any Lender(s), the Borrower shall make additional
payments to such Lender(s) along with the regular payments as they become due so
that the end result is that such Lender(s) receives the amount that the
Lender(s) would have received if no such withholdings were made.
5.2 MAINTENANCE OF EXISTENCE.
Except for transactions permitted under Section 6.6, each Borrower
Entity shall (a) maintain its fundamental existence, name, material rights, and
franchises and (b) maintain its qualification and good standing in all states in
which such qualification is necessary (except to the extent that failure to so
qualify would not have a Material Adverse Effect).
53
5.3 FINANCIAL STATEMENTS AND REPORTS.
The Borrower shall furnish to the Agent and the Lenders or cause the
Agent and the Lenders to receive all of the following, all of which must be in
number sufficient for all Lenders and otherwise in form and substance
satisfactory to the Agent and the Lenders:
5.3.1 Quarterly Financial Reports. As soon as available, and
in any event by the fiftieth (50th) day of each fiscal quarter (except
that no quarterly financial statements need to be delivered for the
fiscal quarter ending December 31), the Borrower shall deliver
consolidated and consolidating balance sheets and income statements and
consolidated statements of cash flows of the Borrower and the other
Borrower Entities for and as of the end of the preceding fiscal
quarter, all prepared by the Borrower on a consolidated (and
consolidating, as applicable) basis and certified by the Borrower's
president or chief financial officer to be complete and correct and to
present fairly, in accordance with GAAP (excluding year-end adjustments
and required footnote disclosures), the financial condition of the
Borrower and its consolidated affiliates as of the date of such
statements and the results of their operations for such period. The
quarterly financial information shall further include calculations of
all financial ratios, the certification of the Borrower's president or
chief financial officer as to the absence of any Default or Event of
Default and a summary of acquisition activity, which summary shall be
in such form as the Agent may reasonably require.
5.3.2 Annual Financial Reports. As soon as available, and in
any event within ninety-five (95) days after the end of each fiscal
year, the Borrower shall deliver audited balance sheets of the Borrower
as of the end of such year and the related audited statements of
income, retained earnings and cash flows for such year, together with
supporting schedules, all such statements prepared in accordance with
GAAP on a consolidated basis and accompanied by an unqualified audit
report prepared by Ernst & Young or some other nationally recognized
accounting firm showing the financial condition of the Borrower and its
consolidated affiliates at the close of such year and the results of
its operations during such year. The annual audited financial
statements shall be accompanied by unaudited consolidating financial
statements for all the Borrower Entities, except that consolidating
statements of cash flows shall not be required. The annual financial
information shall include calculations of all financial ratios as
determined based upon the audited financial statements and the
certification of the Borrower's president or chief financial officer as
to the absence of any Default or Event of Default.
5.3.3 Budgets. As soon as available, and in any event within
sixty (60) days after the beginning of each fiscal year, the Borrower
shall deliver its Capital Expenditures budget and its operating budget
for the current fiscal year.
5.3.4 Accountant Reports. Within fifteen (15) days of the
Borrower's receipt thereof, the Borrower shall deliver a copy of each
management letter submitted to the Borrower or its consolidated
affiliates by their accountants in connection with any annual, interim
or special audit made by them.
54
5.3.5 Owner Mailings. Promptly upon the sending thereof, the
Borrower shall deliver a copy of each material statement, report or
notice sent to its shareholders.
5.3.6 SEC Filings. As soon as available, and in no event more
than fifteen (15) days after the filing thereof, the Borrower shall
deliver copies of all regular, periodic and special reports that any
Borrower Entity files with the United States Securities and Exchange
Commission or any successor thereto, or any national securities
exchanges or the National Association of Securities Dealers.
5.3.7 Change in Accounting Policies. The Borrower shall
promptly give written notice of any material change in accounting
policies or financial reporting practices on the part of any Borrower
Entity.
5.3.8 Notice Upon Perceived Breach. The Borrower agrees to
give prompt written notice of any action or inaction by or on behalf of
the Agent or any Lender in connection with this Agreement or the
Obligations that the Borrower believes may be actionable against such
party or a defense to payment of any or all of the Obligations for any
reason, including, but not limited to, commission of a tort or
violation of any contractual duty or duty implied by law.
5.3.9 Changes in Constituent Document. The Borrower shall give
prompt written notice of any material change in the corporate charter
or bylaws of the Borrower or any Subsidiary following the encumbrance
of the stock thereof in favor of the Agent as required under this
Agreement, and shall provide the Agent with a copy of such change
(Borrower Entities are restricted in the adoption of such amendments as
provided elsewhere in the Loan Documents, and nothing contained in this
Section shall be deemed a waiver of such restrictions).
5.3.10 Notice of Litigation. The Borrower shall give prompt
written notice of any litigation, arbitration, tax audit,
administrative proceeding or investigation that may hereafter be
instituted or threatened in writing in which the Borrower would be a
party or which otherwise may affect any Borrower Entity or any of their
business, operations or Properties, except for (i) actions seeking
monetary damages in an amount of less than five percent (5%) of
Consolidated EBITDA calculated over the most recent four fiscal
quarters for which financial statements have been submitted, (ii)
actions seeking only monetary damages in an unspecified amount, if the
Borrower believes in good faith that the matter, if adversely
determined, would not have a Material Adverse Effect, and (iii) matters
arising from premises or vehicular liability seeking only monetary
damages and which are fully covered by insurance, subject only to any
applicable deductible.
5.3.11 Defaults and Changes. The Borrower shall give prompt
written notice if the Borrower learns of the occurrence of (i) any
event that constitutes a Default or an Event of Default, together with
a detailed statement of the steps being taken as a result thereof, or
(ii) any Material Adverse Change.
55
5.3.12 Other Information. The Borrower shall promptly provide
such other information respecting the condition or operations,
financial or otherwise, of the Borrower Entities as the Agent or any
Lender may from time to time reasonably request.
5.4 TAXES AND OTHER ENCUMBRANCES.
Each Borrower Entity shall make due and timely payment or deposit of
all federal, state and local taxes, assessments or contributions required of it
by law, and execute and deliver to the Agent, on demand, appropriate
certificates attesting to the payment or deposit thereof; provided, however,
that the Borrower Entities shall not be required to pay or discharge any such
tax, assessment, charge or claim for as long as it is being diligently contested
in good faith by proper proceedings and for which appropriate reserves are being
maintained.
5.5 PAYMENT OF DEBTS.
Each Borrower Entity shall pay all of its Debts as and when the same
become due in accordance with their terms, except for such Debts being contested
in good faith by appropriate proceedings and for which adequate reserves have
been established on the books of such Borrower Entity in accordance with GAAP,
unless the failure to make any such payment could have a Material Adverse
Effect.
5.6 COMPLIANCE WITH LAWS.
Each Borrower Entity shall observe and comply with all Laws (including,
but not limited to, Fraud and Abuse Laws), and shall maintain all certificates,
franchises, permits, licenses, and authorizations necessary to the conduct of
its business or the operation of its Properties, except for such Laws,
certificates, franchises, permits, licenses and authorizations which, if
violated or not obtained and full penalties were imposed for such violation,
would not cause a Material Adverse Effect. Each Borrower Entity shall further
use its best efforts to assure the compliance by all Providers with all
applicable Laws, including, but not limited to, medical licensure and Fraud and
Abuse Laws, relating to their providing of professional services, except for
those which, if violated and full penalties were imposed for such violation,
would not cause a Material Adverse Effect.
5.7 MAINTENANCE OF PROPERTY.
All Borrower Entities shall maintain their Property (and any Property
leased by or consigned or held under title retention or conditional sales
contracts) in good and workable condition at all times, subject to ordinary wear
and tear, normal discards and replacements due to functional and useful-life
obsolescence, and shall make all repairs, replacements, additions, and
improvements to their Property reasonably necessary and proper to cause the
business carried on in connection with their Property to be conducted properly
and efficiently at all times.
56
5.8 COMPLIANCE WITH CONTRACTUAL OBLIGATIONS.
Each Borrower Entity will perform all of its obligations in respect of
all material contracts to which it is a party and will use its best efforts to
keep, and to take all action to keep, such contracts in full force and effect
and not allow any such contract to lapse or be terminated or any rights to renew
such to be forfeited or canceled, if such lapse, termination, forfeiture or
cancellation would have a Material Adverse Effect; provided, however, that any
such contract may lapse or be terminated or such renewal rights may be forfeited
or canceled if in the reasonable business judgment of the Borrower Entities it
is in their best interests to allow or cause such lapse, termination, forfeiture
or cancellation.
5.9 FURTHER ASSURANCES.
The Borrower Entities shall promptly cure any defects in the creation,
issuance, or delivery of the Loan Documents. The Borrower Entities at their
expense will execute (or cause to be executed) and deliver to the Agent upon
request all such other and further documents, agreements, and instruments in
compliance with or accomplishment of the covenants and agreements applicable to
them in the Loan Documents, or to evidence further and to describe more fully
any Collateral intended as security for the Obligations, or to correct any
omissions in the Loan Documents, or to state more fully the Obligations and
agreements set out in any of the Loan Documents, or to perfect, protect, or
preserve any Encumbrances created pursuant to any of the Loan Documents, or to
make any recordings, to file any notices, or to obtain any consents, all as the
Agent may reasonably request. The Borrower appoints the Agent as the Borrower's
attorney-in-fact to execute any financing statements or other instruments of
perfection with respect to the Collateral.
5.10 SECURITY INTEREST; SETOFF.
In order further to secure the payment of the Obligations, the Borrower
hereby grants to the Agent and to each Lender a security interest and right of
setoff against all of the Borrower's presently owned or hereafter acquired
monies, items, credits, deposits and instruments (including certificates of
deposit) presently or hereafter in the possession of any Lender or the Agent. By
maintaining any such accounts or other property with a Lender or the Agent, the
Borrower acknowledges that the Borrower voluntarily subjects the property to the
security interest arising hereunder. Subject to the provisions in Article IX
hereof, a Lender may exercise its rights under this Section without prior notice
(but with prompt notice following the setoff) following an Event of Default. The
Borrower agrees that neither the Lenders nor the Agent shall be liable for the
dishonor of any instrument after notice of setoff shall have been duly given
resulting from a Lender's exercise of its rights under this Section.
5.11 INSURANCE.
5.11.1 General Insurance Requirements. In addition to any
other specific requirements set forth in this Agreement and in other
Loan Documents, all the Borrower Entities shall maintain insurance on
all insurable Properties now or hereafter owned by them against such
risks and to the extent customary in their industry, and shall maintain
57
or cause to be maintained public liability and worker's compensation
insurance to the extent customary in the industry. The present casualty
insurance coverage of the Borrower Entities is outlined as to carrier,
policy number, expiration date, type and amount on Schedule 5.11.
5.11.2 Practice-Related Insurance Requirements. All Borrower
Entities shall maintain insurance for claims, however characterized,
against such Borrower Entities in connection with the provision of
medical services by Providers and/or ancillary services provided by
such Borrower Entities, in an amount of at least $1,000,000.00 per
occurrence, with such deductibles as are in accordance with normal
industry practice for entities the size and nature of the Borrower
Entities on a consolidated basis. The present liability insurance
coverage of the Borrower Entities is outlined as to carrier, policy
number, expiration date, type and amount on Schedule 5.11.
5.12 ACCOUNTS AND RECORDS.
The Borrower Entities shall maintain current books of record and
account, in which full, true, and correct entries will be made of all
transactions.
5.13 OFFICIAL RECORDS.
The Borrower Entities shall maintain current corporate and official
records, minute books and stock ledgers.
5.14 BANKING RELATIONSHIPS.
The Borrower Entities shall maintain their deposit accounts with the
Lenders or with other FDIC-insured depository institutions.
5.15 RIGHT OF INSPECTION.
The Borrower Entities shall permit any officer, employee, or agent of a
Lender or the Agent to visit and inspect during ordinary business hours any of
their Property, to examine their books of record and accounts and corporate
records, to take copies and extracts from such books of record and accounts, and
to discuss the affairs, finances, and accounts of the Borrower Entities with
their respective officers, accountants, and auditors, all at such reasonable
times and as often as the Agent or a Lender may reasonably desire and upon
reasonable advance notice absent an Event of Default. Without limiting the
Agent's right to obtain equitable relief as to any other appropriate right in
this Agreement or in other Loan Documents, the Borrower agrees that the rights
in this Section may be enforced by affirmative injunction and, to the extent the
right to review records may be denied, the right may be enforced by a
restraining order prohibiting the interference by the Borrower with the exercise
of rights to review of the records pursuant to this Section. Absent an Event of
Default, all expenses of such inspections, etc. shall be paid by the respective
Lenders, and in the presence of an Event of Default, all reasonable expenses
thereof shall be paid by the Borrower.
58
5.16 ERISA INFORMATION AND COMPLIANCE.
The Borrower Entities shall comply with ERISA and all other applicable
laws governing any pension or profit sharing plan or arrangement to which they
are a party, except for matters which would not have a Material Adverse Effect.
The Borrower Entities shall (i) upon request, provide the Agent with copies of
any annual report required to be filed pursuant to ERISA with respect to any
Plan or any other employee benefit plan; (ii) notify the Agent upon the
occurrence of any ERISA Event or of any additional act or condition arising in
connection with any Plan which they believe might constitute grounds for
termination thereof by the PBGC or for the appointment of a trustee to
administer the Plan; and (iii) furnish to the Agent, promptly upon request, such
additional information concerning any Plan or any other employee benefit plan as
the Agent may request.
5.17 INDEMNITY; EXPENSES.
Whether or not the transactions contemplated hereby are consummated,
the Borrower agrees to indemnify, save and hold harmless the Agent, each Lender
and their respective Affiliates, directors, officers, employees, counsel, agents
and attorneys-in-fact (collectively the "Indemnitees") from and against: (a) any
and all claims, demands, actions or causes of action that are asserted against
any Indemnitee by any Person (other than the Agent or any Lender) relating
directly or indirectly to a claim, demand, action or cause of action that such
Person asserts or may assert against any Credit Party, any Affiliate of any
Credit Party or any of their respective officers or directors; (b) any and all
claims, demands, actions or causes of action that may at any time (including at
any time following repayment of the Obligations and the resignation or removal
of the Agent or the replacement of any Lender) be asserted or imposed against
any Indemnitee, arising out of or relating to, the Loan Documents, any
predecessor Loan Documents, the Commitments, the use or contemplated use of the
proceeds of any Loan, or the relationship of any Credit Party, the Agent and the
Lenders under this Agreement or any other Loan Document; (c) any administrative
or investigative proceeding by any Governmental Authority arising out of or
related to a claim, demand, action or cause of action described in subsection
(a) or (b) above; and (d) any and all liabilities (including liabilities under
indemnities), losses, costs or expenses (including reasonable fees and costs of
counsel) that any Indemnitee suffers or incurs as a result of the assertion of
any foregoing claim, demand, action, cause of action or proceeding, or as a
result of the preparation of any defense in connection with any foregoing claim,
demand, action, cause of action or proceeding, in all cases, whether or not
arising out of the negligence of an Indemnitee, and whether or not an Indemnitee
is a party to such claim, demand, action, cause of action or proceeding (all the
foregoing, collectively, the "Indemnified Liabilities"); provided that no
Indemnitee shall be entitled to indemnification for any claim caused by its own
gross negligence or willful misconduct or for any loss asserted against it by
another Indemnitee. The agreements in this Section shall survive the termination
of the Commitments and repayment of all the other Obligations.
5.17.1 Taxes. All taxes that the Lenders or the Agent may be
required to pay because of the Obligations or because of the Lenders'
or the Agent's interest in any property securing the payment of the
Obligations, excepting taxes based upon the net income of a Lender or
the Agent.
59
5.17.2 Administration. All reasonable costs of the preparation
of this Agreement and any other related documents and the
administration of the Obligations (except for the Lenders' and the
Agent's usual overhead incurred in the acceptance and processing of
payments, the routine review of financial statements, certifications
and reports, routine communications with the Borrower, and other
ordinary activities that are not occasioned by a Default or an Event of
Default or by a request of the Borrower to waive or vary the terms of
this Agreement).
5.17.3 Protection of Collateral. All costs of preserving,
insuring, preparing for sale (whether by improvement, repair or
otherwise) or selling any Collateral.
5.17.4 Costs of Collection. All court costs and other costs of
collecting any debt, overdraft or other obligation included in the
Obligations.
5.17.5 Litigation. All reasonable costs arising from any
litigation, investigation, or administrative proceeding (whether or not
the Agent or a Lender is a party thereto) that the Agent or a Lender
may incur as a result of the Obligations or as a result of their
association with any of the Borrower Entities, including, but not
limited to, expenses incurred by the Agent or a Lender in connection
with a case or proceeding involving any Borrower Entity under any
chapter of the Bankruptcy Code or any successor statute thereto.
5.17.6 Attorneys' Fees. Reasonable attorneys' fees incurred in
connection with any of the foregoing.
If a Lender or the Agent pays any of the foregoing expenses, they shall become a
part of the Obligations and shall bear interest at the Default Rate. This
Section shall remain in full effect regardless of the full payment of the
Obligations, the purported termination of this Agreement, the delivery of the
executed original of this Agreement to the Borrower, or the content or accuracy
of any representation made by the Borrower to the Lenders or the Agent;
provided, however, the Agent or any Lender may terminate this Section as to
itself by executing and delivering to the Borrower a written instrument of
termination specifically referring to this Section.
5.18 ASSISTANCE IN LITIGATION.
The Borrower covenants to, upon request, cooperatively participate in
any proceeding in which the Borrower is not an adverse party to the Lenders or
the Agent and which concerns the Lenders' or the Agent's rights regarding the
Obligations or any Collateral.
5.19 NAME CHANGES.
The Borrower shall give the Agent notice no more than fifteen (15)
Business Days after any Borrower Entity changes its name.
60
5.20 ESTOPPEL LETTERS.
The Borrower covenants to provide the Agent, within ten (10) days after
request, an estoppel letter stating (i) the balance of the Obligations, (ii)
whether the Borrower has any defenses to payment of the Obligations and (iii)
the nature of any defenses to payment of the Obligations. Such balance as
presented for confirmation and the nonexistence of defenses shall be presumed if
the Borrower fails to respond to such a request within the required period.
5.21 ENVIRONMENTAL MATTERS.
5.21.1 Compliance With Environmental Laws. All Borrower
Entities will (i) employ in connection with their operations,
appropriate technology and compliance procedures to maintain compliance
with any applicable Environmental Laws, the violation of which would
reasonably be expected to have a Material Adverse Effect, (ii) obtain
and maintain any and all materials permits or other permits required by
applicable Environmental Laws in connection with its operations,
excepting only such permits, etc. which would not by their absence
cause a Material Adverse Effect, and (iii) dispose of any and all
Hazardous Substances only at facilities and with carriers reasonably
believed to possess valid permits under any applicable state and local
Environmental Laws. All Borrower Entities shall use their best efforts
to obtain all certificates required by law to be obtained by them from
all contractors employed by them in connection with the transport or
disposal of any Hazardous Substances.
5.21.2 Remedial Work. If any investigation, site monitoring,
containment, clean-up, removal, restoration or other remedial work of
any kind or nature with respect to any Borrower Entity's Properties is
required to be performed by them under any applicable local, state or
federal law or regulation, any judicial order, or by any governmental
or non-governmental entity or Person because of, or in connection with,
the current or future presence, suspected presence, release or
suspected release of a Hazardous Substance in or into the air, soil,
groundwater, surface water or soil vapor at, on, about, under, or
within any of a Borrower Entity's Property (or any portion thereof),
the Borrower shall within 30 days after written demand for performance
thereof (or such shorter period of time as may be required under
applicable law, regulation, order or agreement), commence and
thereafter diligently prosecute to completion, all such remedial work.
5.21.3 Indemnification of the Lenders and the Agent. The
Borrower agrees to indemnify, defend (with counsel reasonably
satisfactory to the indemnified party or parties) and hold harmless the
Lenders and the Agent against any loss, liability claim or expense,
including attorneys' fees, that a Lender or the Agent may incur as a
result of the violation or alleged violation of any Environmental Law
by a Borrower Entity or with respect to any other violation of
Environmental Laws with respect to any Borrower Entity's Properties.
This covenant shall survive the repayment of the Loans.
61
5.22 OPINIONS OF COUNSEL.
The Borrower agrees that the Agent may from time to time, but not more
frequently than once every calendar year absent a Default or an Event of
Default, request in writing a copy of the most recent letter of in-house counsel
and/or outside healthcare counsel issued to the Borrower's auditors addressing
any material loss contingencies as to which such counsel have devoted
substantive attention. Copies of such letters shall be delivered to the Lenders
within ten (10) days after request. Additionally, the Borrower shall, within
twenty (20) days after written request, respond to such questions that may be
raised by the Agent from time to time regarding the Borrower Entities'
compliance with Fraud and Abuse Laws, and shall engage the assistance of the
Borrower's healthcare counsel for the purpose of responding to such questions if
the Agent so requests.
Furthermore, in the event the aggregate revenues attributable to the
Non-Opinion Subsidiaries for the four fiscal quarter period most recently ending
constitutes ten percent (10%) or more of the consolidated revenues of the
Borrower and its Subsidiaries for such four fiscal quarter period, the Borrower
agrees that it shall cause outside counsel to provide a legal opinion (in form
and substance reasonably satisfactory to the Agent) to the Agent within 30 days
of such fiscal quarter end with respect to those Non-Opinion Subsidiaries
necessary to cause the aggregate revenues attributable to the Non-Opinion
Subsidiaries for the four fiscal quarter period most recently ending to be less
than ten percent (10%) of the consolidated revenues of the Borrower and its
Subsidiaries for such four fiscal quarter period. Such legal opinions shall
cover, among other things, the legality, validity, binding effect and
enforceability of the Loan Documents with respect to the applicable
Subsidiaries.
5.23 ADDITIONAL CREDIT PARTIES.
As soon as practicable and in any event within 30 days after any Person
becomes a Subsidiary of the Borrower, the Borrower shall provide the Agent with
written notice thereof and shall (a) if such Person is a wholly-owned Domestic
Subsidiary of a Credit Party, cause such Person to execute a Joinder Agreement
in substantially the same form as Exhibit 5.23, (b) if such Person is a Domestic
Subsidiary of a Credit Party, cause 100% of the Capital Stock of such Person
owned by such Credit Party to be delivered to the Agent (together with undated
stock powers signed in blank) or if such Person is a direct Foreign Subsidiary
of a Credit Party, cause 65% of the Capital Stock owned by such Credit Party
entitled to vote and 100% of the Capital Stock not entitled to vote of such
Person owned by such Credit Party to be delivered to the Agent (together with
undated stock powers signed in blank (unless, with respect to a Foreign
Subsidiary, such stock powers are deemed unnecessary by the Agent in its
reasonable discretion under the law of the jurisdiction of incorporation of such
Person)), and in each case pledged to the Agent pursuant to an appropriate
pledge agreement(s) any necessary perfection documents in each case in a form
reasonably acceptable to the Agent, (c) if such Person is a wholly-owned
Domestic Subsidiary of a Credit Party and has any Subsidiaries (i) deliver all
of the Capital Stock of any Domestic Subsidiaries owned by such Person and 65%
of the Capital Stock entitled to vote and 100% of the Capital Stock not entitled
to vote of any direct Foreign Subsidiaries owned by such Person (together with
undated stock powers signed in blank (unless, with respect to a Foreign
Subsidiary, such stock powers are deemed unnecessary by the Agent in its
62
reasonable discretion under the law of the jurisdiction of incorporation of such
Person) to the Agent and (ii) execute a pledge agreement any necessary
perfection documents in each case in a form reasonably acceptable to the Agent
and (d) deliver such documentation as the Agent may reasonably request in
connection with the foregoing, including without limitation, certified
resolutions and other organizational documents of such Person, all in form,
content and scope reasonably satisfactory to the Agent.
5.24 INTER-COMPANY NOTES RECEIVABLE.
The loan obligations of any Borrower Entity to any Credit Party which
are in excess of $10,000,000 shall be evidenced by Inter-Company Notes pledged
to the Agent to secure the Obligations.
VI. NEGATIVE COVENANTS
The Borrower covenants and agrees that, so long as this Agreement shall
remain outstanding, and until all of the Commitments hereunder shall have
terminated:
6.1 DEBT.
The Borrower will not permit any Borrower Entity to contract, create,
incur, assume or permit to exist any Debt, except:
6.1.1 Senior Debt. Indebtedness arising under (a) this
Agreement and the other Loan Documents and (b) the 364-Day Loan
Agreement and the other documents, instruments and agreements executed
in connection therewith.
6.1.2 Endorsements. Payment of collection items, pursuant to
endorsements of negotiable or similar instruments for collection or
deposit in the ordinary course of business.
6.1.3 Hedging Agreements. The obligations of any Borrower
Entity in respect of Hedging Agreements entered into in order manage
existing or anticipated interest rate or exchange rate risks and not
for speculative purposes.
6.1.4 Purchase Money. Purchase money Debt (including Capital
Leases) hereafter incurred by any Borrower Entity to finance the
purchase of fixed assets, provided that (i) the total of all such Debt
for all such Persons taken together shall not exceed an aggregate
principal amount of $10,000,000 at any one time outstanding and (ii) no
such Debt shall be refinanced for a principal amount in excess of the
principal balance outstanding thereon at the time of such refinancing.
6.1.5 Other Debt. Other unsecured Debt of the Borrower and its
Subsidiaries in an aggregate outstanding principal amount not to exceed
$15,000,000 at any time.
63
6.1.6 Intercompany Debt. (i) Debt owing from one Credit Party
to another Credit Party and (ii) other intercompany Debt permitted by
Section 6.3.
6.1.7 Existing Debt. Debt of the Borrower and its Subsidiaries
set forth on Schedule 6.1.7.
6.2 ENCUMBRANCES.
No Borrower Entity shall create, incur, assume, or permit to exist any
Encumbrance on any of its Property (now owned or hereafter acquired) except for
Permitted Encumbrances. No Borrower Entity shall sign or file under the Uniform
Commercial Code a financing statement that names such Borrower Entity as debtor
or the equivalent or sign any security agreement authorizing any secured party
thereunder to file any such financing statement, except to secure Permitted
Encumbrances.
6.3 INVESTMENTS.
The Borrower will not permit any Borrower Entity to make any
Investments, except for:
(a) those specific investments in existence as of the Closing Date and
set forth on Schedule 6.3;
(b) general obligations of, or obligations unconditionally guaranteed
as to principal and interest by, the United States of America maturing within
fifteen (15) months of the date of purchase;
(c) commercial paper having a rating of not less than "A2" or "P2" from
Xxxxx'x or S&P, respectively;
(d) Permitted Acquisitions;
(e) Permitted Equity Investments;
(f) Investments in any Credit Party;
(g) Investments by any Credit Party in any Borrower Entity that is not
a Credit Party; provided, that, (i) the aggregate loans extended to such Person
from the Credit Parties shall not exceed $1,000,000 in the aggregate at any one
time outstanding, (ii) the total Investments by the Credit Parties in such
Person shall not exceed $5,000,000 in the aggregate at any one time outstanding
and (iii) as of the end of the four fiscal quarter period most recently ending,
the aggregate amount of such Investments do not exceed an amount equal to ten
percent (10%) of Consolidated EBITDA for such period;
(h) certificates of deposit and bankers acceptances issued by a Lender
or another banking institution with a minimum net worth of $500,000,000.00 and
having a letter of credit rating of not less than "A" from Xxxxx'x or S&P,
respectively;
64
(i) loans extended by a Borrower Entity to any Credit Party in the
ordinary course of business;
(j) loans advanced to employees of the Borrower Entities for reasonable
travel and business expenses incurred in the ordinary course of business;
(k) loans to officers and directors of the Borrower Entities not to
exceed the sum of $500,000 in the aggregate at any time; and
(l) loans to nephrology physicians and nephrology physician practices
not to exceed $5,000,000 in the aggregate at any one time outstanding.
6.4 CHANGE OF CONTROL.
The Borrower shall not suffer or permit the occurrence of a Change of
Control.
6.5 NATURE OF BUSINESS.
No Borrower Entity shall engage in any activity or business beyond
those activities or businesses included in the Borrower's Line of Business.
6.6 CONSOLIDATION, MERGERS, ETC.
No Borrower Entity shall enter into any agreement to merge or
consolidate, or liquidate, wind up or dissolve itself (or suffer any liquidation
or dissolution); provided, that, notwithstanding the foregoing provisions of
this Section 6.6, the following actions may be taken if the Agent is given prior
written notice of such action, (i) any Subsidiary may merge or consolidate with
any other Subsidiary provided that (i) if a Guarantor is party thereto, a
Guarantor shall be the continuing or surviving corporation, (ii) the Credit
Parties shall cause to be executed and delivered such documents, instruments and
certificates as the Agent may reasonably request in order to maintain the
perfection and priority of the Agent's liens on the Capital Stock of the
Borrower Entities and (iii) after giving effect to such transaction, no Default
or Event of Default shall exist and (b) any Subsidiary may wind up, liquidate or
dissolve itself so long as it transfers all or substantially all of its assets
to a Credit Party prior to such wind up, liquidation or dissolution.
6.7 ASSET DISPOSITIONS.
No Borrower Entity shall dispose of any of its assets (including
without limitation pursuant to any sale and leaseback transaction or
securitization transaction) other than (i) the sale or exchange of used or
obsolete equipment provided that the equipment disposed of is replaced with
other equipment as needed to maintain continuous operations, (ii) the transfer
of assets among Credit Parties, if immediately after giving effect thereto no
Event of Default will exist, and (iii) other dispositions of assets which, in
the aggregate for any fiscal year, represent less than ten percent (10%) of each
of (x) the Borrower's total assets on a consolidated basis as reported
65
to the Lenders for the previous fiscal year, and (y) Consolidated EBITDA
determined on a rolling four-quarter basis as reported for the previous fiscal
year.
6.8 INCONSISTENT AGREEMENTS.
No Borrower Entity shall enter into any material agreement containing
any provision which would be violated or breached by the performance by the
Borrower Entities of their obligations under the Loan Documents.
6.9 FICTITIOUS NAMES.
The Borrower shall not use any name other than the name used in
executing this Agreement or any assumed or fictitious name.
6.10 ADVERSE ACTION WITH RESPECT TO PLANS.
No Borrower Entity shall take any action to terminate any Plan which
would reasonably result in a material liability of a Borrower Entity to any
Person.
6.11 TRANSACTIONS WITH AFFILIATES.
No Borrower Entity shall enter into any transaction with any Affiliate
except in the ordinary course of business and on fair and reasonable terms no
less favorable to the Borrower Entity than they would obtain in a comparable
arms length transaction with a Person not an Affiliate.
6.12 CONSTITUENT DOCUMENT AMENDMENTS.
No Borrower Entity shall amend its corporate charter or bylaws in any
material respect, except as necessary to accomplish corporate transactions that
could not reasonably be expected to adversely affect the Lenders.
6.13 ADVERSE TRANSACTIONS.
No Borrower Entity shall enter into any transaction that materially and
adversely affects or, to the best of its knowledge, is likely to materially and
adversely affect the Collateral or the Borrower's ability to repay the
Obligations.
6.14 ACCOUNTING CHANGES.
The Borrower shall not change its fiscal year or make any other
significant change in consolidated or consolidating accounting treatment and
reporting practices, except as required or permitted by GAAP.
66
6.15 RESTRICTED PAYMENTS.
The Borrower shall not permit any Borrower Entity to, directly or
indirectly, declare, order, make or set apart any sum for or pay any Restricted
Payment, except (a) to make dividends or distributions payable solely in the
same class of Capital Stock of such Person, (b) to make dividends or other
distributions payable to a Credit Party (directly or indirectly through
Subsidiaries), (c) so long as no Default or Event of Default exists prior to and
after giving effect to such transaction, the Borrower may, from and after the
Closing Date, repurchase shares of its Capital Stock in an amount not to exceed
during the term of this Agreement an aggregate amount equal to $100,000,000),
(d) so long as no Default or Event of Default exists prior to and after giving
effect thereto, any Borrower Entity may make Permitted Dividends and (e) so long
as no Default or Event of Default exists prior to and after giving effect
thereto, any Borrower Entity may make Permitted Stock Purchases.
6.16 LIMITATION ON RESTRICTED ACTIONS.
The Borrower will not permit any Borrower Entity to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Person to (a) pay
dividends or make any other distributions to any Credit Party on its Capital
Stock or with respect to any other interest or participation in, or measured by,
its profits, (b) pay any Indebtedness or other obligation owed to any Credit
Party, (c) make loans or advances to any Credit Party, (d) sell, lease or
transfer any of its properties or assets to any Credit Party, (e) grant an
Encumbrance on its properties or assets whether now owned or hereafter acquired
or (f) act as a Guarantor and pledge its equity interests pursuant to the Loan
Documents or any renewals, refinancings, exchanges, refundings or extension
thereof, except (in respect of any of the matters referred to in clauses (a)-(d)
above) for such encumbrances or restrictions existing under or by reason of (i)
this Agreement and the other Loan Documents, (ii) the 364-Day Loan Agreement or
(iii) applicable law.
6.17 SALE LEASEBACKS.
Except as set forth on Schedule 6.17, the Borrower will not permit any
Borrower Entity to, directly or indirectly, become or remain liable as lessee or
as guarantor or other surety with respect to any lease, whether an Operating
Lease or a Capital Lease, of any Property (whether real, personal or mixed),
whether now owned or hereafter acquired, (a) which such Borrower Entity has sold
or transferred or is to sell or transfer to a Person which is not a Borrower
Entity or (b) which such Borrower Entity intends to use for substantially the
same purpose as any other Property which has been sold or is to be sold or
transferred by such Borrower Entity to another Person which is not a Borrower
Entity in connection with such lease.
6.18 NO FURTHER NEGATIVE PLEDGES.
Except (a) pursuant to this Agreement and the other Loan Documents, (b)
pursuant to the 364-Day Loan Agreement and (c) pursuant to any document or
instrument governing Debt incurred pursuant to Section 6.1.4, provided that any
such restriction contained therein relates only to the asset or assets acquired
in connection therewith, the Borrower will not permit any
67
Borrower Entity to enter into, assume or become subject to any agreement
prohibiting or otherwise restricting the creation or assumption of any
Encumbrance upon its facilities or assets, whether now owned or hereafter
acquired, or requiring the grant of any security for such obligation if security
is given for some other obligation except for any prohibition or restriction
existing under or by reason of (i) applicable law or (ii) customary
non-assignment provisions in any lease governing a leasehold interest.
VII. FINANCIAL COVENANTS
7.1 CONSOLIDATED NET WORTH.
The Borrower shall maintain a Consolidated Net Worth as of the end of
each fiscal quarter in an amount at least equal to $480,000,000 minus the amount
of Capital Stock of the Borrower repurchased by the Borrower subsequent to the
Closing Date in accordance with Section 6.16, plus (on a cumulative basis as of
the end of each fiscal quarter of the Borrower commencing with the fiscal
quarter of the Borrower ending June 30, 2002) an amount equal to (i) the Net
Proceeds of all Equity Issuances issued by the Borrower after the Closing Date
plus (ii) seventy-five percent (75%) of the amount of net income for the fiscal
quarter then ended, without adjustment for net losses.
7.2 LEVERAGE RATIO.
The Borrower shall maintain a Leverage Ratio, measured as of the end of
each fiscal quarter for the previous four consecutive fiscal quarters, of no
greater than 2.50 to 1.00.
7.3 TOTAL CAPITALIZATION RATIO.
The Borrower shall maintain at all times a Total Capitalization Ratio
of no greater than 0.45 to 1.00.
7.4 FIXED CHARGE COVERAGE.
The Borrower shall maintain a Fixed Charge Coverage Ratio measured as
of the end of each fiscal quarter for the previous four consecutive fiscal
quarters of at least 2.00 to 1.00.
VIII. EVENTS OF DEFAULT
8.1 EVENTS OF DEFAULT.
Any of the following events shall be considered an Event of Default
under this Agreement:
8.1.1 Payments. The Borrower's failure to make payment of any
installment of principal included in the Obligations when due or any
payment of interest or expenses included in the Obligations within
three (3) days of when due.
68
8.1.2 Representations and Warranties. The making of any
representation or warranty by the Borrower or any other party in any
Loan Document that was incorrect in any material respect as of the date
thereof.
8.1.3 Negative Covenants. The failure of any Credit Party to
comply with any of the requirements of Article VI hereof.
8.1.4 Financial Covenants. The failure of any Credit Party to
comply with any of the requirements of Article VII hereof.
8.1.5 Reporting Requirements. The failure of any Credit Party
or any other party to timely perform any covenant in the Loan Documents
requiring the furnishing of notices, financial reports or other
information to the Agent or the Lenders when due.
8.1.6 Other Covenants. The failure of any Credit Party to
observe or perform any term, covenant or agreement contained in any
Loan Document, which covenant is not subject to any specific provision
in this Article VIII; provided, however, as to any such breach that is
reasonably susceptible to being cured, the occurrence of such breach
shall not constitute an Event of Default hereunder if such breach is
fully cured within twenty (20) days (or ten (10) days, if such breach
may be cured by the payment of a specific sum of money) after the
earlier of the Borrower Entity's knowledge of the facts giving rise
thereto or the Agent's written notice thereof to the Borrower given in
accordance with the provisions hereof.
8.1.7 Bankruptcy Event. A Bankruptcy Event shall occur with
respect to any Borrower Entity.
8.1.8 Discontinuance of Business. Any Borrower Entity's
discontinuance of its usual business or its dissolution, except
pursuant to transactions permitted under this Agreement.
8.1.9 Default on Other Debt. With respect to any Debt (other
than Debt outstanding under this Agreement) in excess of $10,000,000 in
the aggregate for the Borrower Entities taken as a whole, (a) any
Borrower Entity shall (i) default in any payment (beyond the applicable
grace period with respect thereto, if any) with respect to any such
Debt, or (ii) the occurrence and continuance of a default (after giving
effect to any applicable grace period) in the observance or performance
relating to such Debt or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event or
condition shall occur or condition exist, the effect of which default
or other event or condition is to cause, or permit, the holder of such
Debt (or trustee or agent on behalf of such holders) to cause
(determined without regard to whether any notice or lapse of time is
required), any such Debt to become due prior to its stated maturity; or
(b) any such Debt shall be declared due and payable, or required to be
prepaid other than by a regularly scheduled required prepayment, prior
to the stated maturity thereof;
69
8.1.10 Judgments. One or more judgments or decrees shall be
entered against one or more of the Borrower Entities involving
liability of $10,000,000 or more in the aggregate (to the extent not
paid or fully covered by insurance provided by a carrier who has
acknowledged coverage and has the ability to perform) and any such
judgments or decrees shall not have been vacated, discharged or stayed
or bonded pending appeal within 30 days from the entry thereof;
8.1.11 Insolvency. The Credit Parties shall no longer be
Solvent on a consolidated basis.
8.1.12 Attachment. The issuance of an attachment or other
process against any Property of any Borrower Entity, unless removed (by
bond or otherwise) within twenty (20) days, if the loss of use of the
property attached would likely have a Material Adverse Effect.
8.1.13 Insurance. Any Borrower Entity's failure to maintain
any insurance required herein or in any other Loan Document.
8.1.14 Contest. Any Borrower Entity's challenge or contest of
the validity or enforceability of this Agreement or any other Loan
Document or the validity, priority or perfection of any security
interest created hereunder or under any other Loan Document in any
action, suit or proceeding, or should they cease to be in full force
and effect.
8.1.15 Fraud and Abuse Laws. Receipt by a Borrower Entity of a
notice from a Governmental Authority that it intends (i) to disallow
requested reimbursements, demand adjustment or repayment of past
reimbursements in excess of five percent (5%) of Consolidated EBITDA
for the previous fiscal year respecting amounts submitted for
reimbursement or collected by a Borrower Entity or a Provider, (ii) to
impose civil money penalties in excess of five percent (5%) of
Consolidated EBITDA for the previous fiscal year, or (iii) to seek to
exclude any Borrower Entity or a Provider from participation in the
Medicare or Medicaid programs due to a failure to comply with Fraud and
Abuse Laws, if the consolidated gross revenues to the Borrower Entities
arising from the affected Borrower Entity or Provider exceed five
percent (5%) of Consolidated EBITDA for the previous fiscal year.
8.1.17 Guaranties. Except as a result of or in connection with
a dissolution or merger of a Subsidiary permitted by Section 6.6, the
guaranty given by any Guarantor under the Guaranty Agreement shall
cease to be in full force and effect, or any Guarantor (including any
Additional Credit Party) under the Guaranty Agreement or any Person
acting by or on behalf of such Guarantor shall deny or disaffirm such
Guarantor's obligations under such guaranty.
8.1.18 364-Day Loan Agreement. There shall occur an Event of
Default under, and as defined in, the 364-Day Loan Agreement.
70
8.1.19 ERISA. Any of the following events or conditions, if
such event or condition could involve possible taxes, penalties, and
other liabilities in an aggregate amount in excess of $10,000,000: (i)
any "accumulated funding deficiency," as such term is defined in
Section 302 of ERISA and Section 412 of the IRC, whether or not waived,
shall exist with respect to any Plan, or any lien shall arise on the
assets of any Borrower Entity or any ERISA Affiliate in favor of the
PBGC or a Plan; (ii) an ERISA Event shall occur with respect to a Plan,
which is, in the reasonable opinion of the Agent, likely to result in
(A) the termination of such Plan for purposes of Title IV of ERISA, or
(B) any Borrower Entity or any ERISA Affiliate incurring any liability
in connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency (within the meaning of
Section 4245 of ERISA) of such Plan; or (iv) any prohibited transaction
(within the meaning of Section 406 of ERISA or Section 4975 of the IRC)
or breach of fiduciary responsibility shall occur which may subject any
Borrower Entity or any ERISA Affiliate to any liability under Sections
406, 409, 502(i), or 502(l) of ERISA or Section 4975 of the IRC, or
under any agreement or other instrument pursuant to which any Borrower
Entity or any ERISA Affiliate has agreed or is required to indemnify
any person against any such liability.
8.2 REMEDIES.
Upon the happening of any Event of Default:
8.2.1 Default Rate. The Obligations shall thereafter bear
interest at the Default Rate.
8.2.2 Termination of Commitments. As provided in Article III
hereof, the Lenders shall not be obligated to advance any additional
Loans and the Swingline Lender will not be obligated to make any
Swingline Loans, and additionally, the Required Lenders may terminate
the obligations of the Lenders and the Swingline Lender to advance any
additional Loans by causing the Agent to give written notice thereof to
the Borrower, which formal termination shall remain in effect
notwithstanding any subsequent cure of the Event of Default and whether
or not the Revolving Credit Loans are accelerated unless the Revolving
Credit Loans are reinstated in writing by the Required Lenders.
8.2.2 Acceleration. The Required Lenders may declare the
entire principal amount of all Obligations then outstanding, including
interest accrued thereon, to be immediately due and payable without
presentment, demand, protest, notice of protest, or dishonor or other
notice of default of any kind, all of which are hereby expressly
waived.
8.2.3 Setoff. Subject to Section 9.8 hereof, any Lender may
exercise its lien upon and right of setoff against any monies, items,
credits, deposits or instruments that such Lender may have in its
possession and which belong to the Borrower or to any other person or
entity liable for the payment of any or all of the Obligations.
71
8.2.4 Cash Collateral. The Agent may or, upon the request and
direction of the Required Lenders, shall, direct the Borrower to pay
(and the Borrower hereby promises to pay, upon receipt of such notice)
to the Agent additional cash, to be held by the Agent, for the benefit
of the Lenders, in a cash collateral account as additional security for
the LOC Obligations in respect of subsequent drawings under all then
outstanding Letters of Credit in an amount equal to the maximum
aggregate amount which may be drawn under all Letters of Credits then
outstanding.
8.2.5 Other Remedies. The Agent shall, at the direction of the
Required Lenders, exercise any right that the Lenders have under any
other document evidencing or securing the Obligations or otherwise
available to the Lenders or the Agent at law or equity including,
without limitation, all rights and remedies against a Guarantor.
Notwithstanding the foregoing, if any Event of Default specified in
Section 8.1.7 or 8.1.11 shall occur, then, without the giving of any
notice or other action by the Agent or the Lenders, (i) the Commitments
shall automatically terminate, (ii) all Loans, all accrued interest in
respect thereof, all accrued and unpaid fees and other indebtedness or
obligations owing to the Agent and/or any of the Lenders hereunder
automatically shall immediately become due and payable and (iii) the
Borrower automatically shall be obligated (and hereby promises) to pay
to the Agent additional cash, to be held by the Agent, for the benefit
of the Lenders, in a cash collateral account as additional security for
the LOC Obligations in respect of subsequent drawings under all then
outstanding Letters of Credit in an amount equal to the maximum
aggregate amount which may be drawn under all Letters of Credits then
outstanding.
IX. AGENCY PROVISIONS
9.1 APPOINTMENT AND AUTHORIZATION OF AGENT.
(a) Each Lender hereby irrevocably (subject to Section 9.7) appoints,
designates and authorizes the Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document, together with such powers as are
reasonably incidental thereto. Notwithstanding any provision to the contrary
contained elsewhere herein or in any other Loan Document, the Agent shall not
have any duties or responsibilities, except those expressly set forth herein,
nor shall the Agent have or be deemed to have any fiduciary relationship with
any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Agent.
Without limiting the generality of the foregoing sentence, the use of the term
"agent" herein and in the other Loan Documents with reference to the Agent is
not intended to connote any fiduciary or other implied (or express) obligations
arising under agency doctrine of any applicable law. Instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties.
72
(b) The Issuing Lender shall act on behalf of the Lenders with respect
to any Letters of Credit issued by it and the documents associated therewith
until such time (and except for so long) as the Agent may agree at the request
of the Required Lenders to act for the Issuing Lender with respect thereto;
provided, however, that the Issuing Lender shall have all of the benefits and
immunities (i) provided to the Agent in this Article IX with respect to any acts
taken or omissions suffered by the Issuing Lender in connection with Letters of
Credit issued by it or proposed to be issued by it and the application and
agreements for letters of credit pertaining to the Letters of Credit as fully as
if the term "Agent" as used in this Article IX included the Issuing Lender with
respect to such acts or omissions, and (ii) as additionally provided herein with
respect to the Issuing Lender.
(c) Each Lender hereby consents to and approves the Security Agreement
and the Collateral Assignment. By execution hereof, the Lenders agree to be
bound by the terms of the Security Agreement and the Collateral Assignment and
further authorize and direct the Collateral Agent to enter into the Security
Agreement and the Collateral Assignment on behalf of the Lenders.
9.2 INDEMNIFICATION OF AGENT.
Whether or not the transactions contemplated hereby are consummated,
the Lenders shall indemnify upon demand each Agent-Related Person (to the extent
not reimbursed by or on behalf of any Credit Party and without limiting the
obligation of any Credit Party to do so), pro rata, and hold harmless each
Agent-Related Person from and against any and all Indemnified Liabilities
incurred by it; provided, however, that no Lender shall be liable for the
payment to any Agent-Related Person of any portion of such Indemnified
Liabilities resulting from such Person's gross negligence or willful misconduct;
provided, however, that no action taken in accordance with the directions of the
Required Lenders shall be deemed to constitute gross negligence or willful
misconduct for purposes of this Section. Without limitation of the foregoing,
each Lender shall reimburse the Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including reasonable fees and costs of counsel)
incurred by the Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that the Agent
is not reimbursed for such expenses by or on behalf of the Borrower. The
undertaking in this Section shall survive termination of the Commitments, the
payment of all Obligations hereunder and the resignation or replacement of the
Agent.
9.3 CREDIT DECISION; DISCLOSURE OF INFORMATION BY AGENT.
Each Lender acknowledges that no Agent-Related Person has made any
representation or warranty to it, and that no act by the Agent hereinafter
taken, including any consent to and acceptance of any assignment or review of
the affairs of any Credit Party or any Affiliate thereof, shall be deemed to
constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material information in their possession. Each Lender represents to the Agent
that it has, independently
73
and without reliance upon any Agent-Related Person and based on such documents
and information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of the Credit Parties and their respective
Subsidiaries, and all applicable bank or other regulatory Laws relating to the
transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Borrower and the other Credit Parties
hereunder. Each Lender also represents that it will, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement and the other Loan Documents, and to make such investigations as
it deems necessary to inform itself as to the business, prospects, operations,
property, financial and other condition and creditworthiness of the Borrower and
the other Credit Parties. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the Agent herein, the Agent
shall not have any duty or responsibility to provide any Lender with any credit
or other information concerning the business, prospects, operations, property,
financial and other condition or creditworthiness of any of the Credit Parties
or any of their respective Affiliates which may come into the possession of any
Agent-Related Person.
9.4 NOTICE OF DEFAULT.
The Agent shall not be deemed to have knowledge or notice of the
occurrence of any Default or Event of Default, except with respect to defaults
in the payment of principal, interest and fees required to be paid to the Agent
for the account of the Lenders, unless the Agent shall have received written
notice from a Lender or the Borrower referring to this Agreement, describing
such Default or Event of Default and stating that such notice is a "notice of
default." The Agent will notify the Lenders of its receipt of any such notice.
The Agent shall take such action with respect to such Default or Event of
Default as may be directed by the Required Lenders in accordance with Article
VIII; provided, however, that unless and until the Agent has received any such
direction, the Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable or in the best interest of the Lenders.
9.5 FUNDING OF ADVANCES PURSUANT TO BORROWING NOTICES.
Except to the extent otherwise provided herein, each Loan, each payment
or (subject to the terms of Section 2.13) prepayment of principal of any Loan,
each payment of interest on the Loans, each payment of commitment fees
referenced in Section 2.14, each reduction of the Total Commitments and each
conversion or extension of any Loan, shall be allocated pro rata among the
Lenders in accordance with the respective principal amounts of their outstanding
Loans.
Furthermore, no Lender shall be responsible for the failure or delay by
any other Lender in its obligation to make its ratable share of a borrowing
hereunder; provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any other Lender of its obligations
hereunder. Unless the Borrower or any Lender has notified the Agent prior to the
date any payment is required to be made by it to the Agent hereunder, that the
Borrower or such Lender, as the case may be, will not make such payment, the
Agent may assume that the Borrower or
74
such Lender, as the case may be, has timely made such payment and may (but shall
not be so required to), in reliance thereon, make available a corresponding
amount to the Person entitled thereto. If and to the extent that such payment
was not in fact made to the Agent in immediately available funds, then:
(a) if the Borrower failed to make such payment, each Lender shall
forthwith on demand repay to the Agent the portion of such assumed payment that
was made available to such Lender in immediately available funds, together with
interest thereon in respect of each day from and including the date such amount
was made available by the Agent to such Lender to the date such amount is repaid
to the Agent in immediately available funds, at the Federal Funds Rate from time
to time in effect; and
(b) if any Lender failed to make such payment, such Lender shall
forthwith on demand pay to the Agent the amount thereof in immediately available
funds, together with interest thereon for the period from the date such amount
was made available by the Agent to the Borrower to the date such amount is
recovered by the Agent (the "Compensation Period") at a rate per annum equal to
the Federal Funds Rate from time to time in effect. If such Lender does not pay
such amount forthwith upon the Agent's demand therefor, the Agent may make a
demand therefor upon the Borrower, and the Borrower shall pay such amount to the
Agent, together with interest thereon for the Compensation Period at a rate per
annum equal to the rate of interest applicable to the applicable borrowing.
Nothing herein shall be deemed to relieve any Lender from its
obligation to fulfill its Commitment or to prejudice any rights that the Agent
or the Borrower may have against any Lender as a result of any default by such
Lender hereunder. A notice of the Agent to any Lender with respect to any amount
owing under this Section shall be conclusive, absent manifest error.
9.6 AGENT IN ITS INDIVIDUAL CAPACITY.
Bank of America and its Affiliates may make loans to, issue letters of
credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting
or other business with each of the Credit Parties and their respective
Affiliates as though Bank of America were not the Agent or the Issuing Lender
hereunder and without notice to or consent of the Lenders. The Lenders
acknowledge that, pursuant to such activities, Bank of America or its Affiliates
may receive information regarding any Credit Party or its Affiliates (including
information that may be subject to confidentiality obligations in favor of such
Credit Party or such Affiliate) and acknowledge that the Agent shall be under no
obligation to provide such information to them. With respect to its Loans, Bank
of America shall have the same rights and powers under this Agreement as any
other Lender and may exercise such rights and powers as though it were not the
Agent or the Issuing Lender, and the terms "Lender" and "Lenders" include Bank
of America in its individual capacity.
75
9.7 SUCCESSOR AGENT.
The Agent may resign as the Agent upon 30 days' notice to the Lenders.
If the Agent resigns under this Agreement, the Required Lenders shall appoint
from among the Lenders a successor Agent for the Lenders which successor Agent
shall be consented to by the Borrower at all times other than during the
existence of an Event of Default (which consent of the Borrower shall not be
unreasonably withheld or delayed). If no successor Agent is appointed prior to
the effective date of the resignation of the Agent, the Agent may appoint, after
consulting with the Lenders and the Borrower, a successor Agent from among the
Lenders. Upon the acceptance of its appointment as successor Agent hereunder,
such successor Agent shall succeed to all the rights, powers and duties of the
retiring Agent and the term "Agent" shall mean such successor Agent and the
retiring Agent's appointment, powers and duties as the Agent shall be
terminated. After any retiring Agent's resignation hereunder as Agent, the
provisions of this Article IX shall inure to its benefit as to any actions taken
or omitted to be taken by it while it was the Agent under this Agreement. If no
successor Agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent's notice of resignation, the retiring Agent's
resignation shall nevertheless thereupon become effective and the Lenders shall
perform all of the duties of the Agent hereunder until such time, if any, as the
Required Lenders appoint a successor agent as provided for above.
9.8 SHARING OF PAYMENTS, ETC.
The Lenders agree among themselves that, in the event that any Lender
shall obtain payment in respect of any Loan, LOC Obligations or any other
obligation owing to such Lender under this Agreement through the exercise of a
right of setoff, banker's lien or counterclaim, or pursuant to a secured claim
under Section 506 of Title 11 of the United States Code or other security or
interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, in excess of its pro rata share of such
payment as provided for in this Agreement, such Lender shall promptly purchase
from the other Lenders a Participation Interest in such Loans, LOC Obligations
and other Obligations so that the amount of the Obligations held by each of the
Lenders shall continue to equal their respective Pro Rata Shares and make such
other adjustments from time to time, as shall be equitable to the end that all
Lenders share such payment in accordance with their respective ratable shares as
provided for in this Agreement. The Lenders further agree among themselves that
if payment to a Lender obtained by such Lender through the exercise of a right
of setoff, banker's lien, counterclaim or other event as aforesaid shall be
rescinded or must otherwise be restored, the other Lenders who shared in the
benefit of such payment shall similarly arrange their interests in the
Obligations to reverse the distribution to them as to allow the originally
remitting Lender to refund such payment. The Borrower agrees that any Lender so
purchasing a share in the Obligations contemplated in this Section 9.8 may, to
the fullest extent permitted by law, exercise all rights of payment, including
setoff, banker's lien or counterclaim, with respect to such share in the
Obligations as fully as if such Lender were a holder of such Loan, LOC
Obligations or other obligation in such amount. Except as otherwise expressly
provided in this Agreement, if any Lender or the Agent shall fail to remit to
the Agent or any other Lender an amount payable by such Lender or the Agent to
the Agent or such other Lender pursuant to this Agreement on the date when such
amount is due,
76
such payments shall be made together with interest thereon for each date from
the date such amount is due until the date such amount is paid to the Agent or
such other Lender at a rate per annum equal to the Federal Funds Rate. If under
any applicable bankruptcy, insolvency or other similar law, any Lender receives
a secured claim in lieu of a setoff to which this Section 9.8 applies, such
Lender shall, to the extent practicable, exercise its rights in respect of such
secured claim in a manner consistent with the rights of the Lenders under this
Section 9.8 to share in the benefits of any recovery on such secured claim.
9.9 PAYMENTS BETWEEN THE AGENT AND THE LENDERS.
9.9.1 Generally. All payments by the Agent to any Lender, and
all payments by any Lender to the Agent, under the terms of this
Agreement shall be made by wire transfer in immediately available funds
to the receiving party's address specified for notices in this
Agreement. If any of the Lenders fails to pay when due any sum payable
to the Agent, then, except as otherwise provided in Section 9.5 hereof,
such sum shall bear interest at the Federal Funds Rate, commencing on
the date such payment was due and ending on, but excluding, the date
such payment is made.
9.9.2 Allocation of Payments After Acceleration.
Notwithstanding any other provisions of this Agreement to the contrary,
after the occurrence and during the continuance of an Event of Default,
all amounts collected or received by the Agent or any Lender on account
of the Obligations or any other amounts outstanding under any of the
Loan Documents or in respect of the Collateral shall be paid over or
delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Agent in connection with enforcing the rights of the Lenders
under the Loan Documents and any protective advances made by the Agent
with respect to the Collateral under or pursuant to the terms of the
Loan Documents;
SECOND, to payment of any fees owed to the Agent;
THIRD, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation, reasonable attorneys' fees)
of each of the Lenders in connection with enforcing its rights under
the Loan Documents or otherwise with respect to the Obligations owing
to such Lender;
FOURTH, to the payment of all of the Obligations consisting of
accrued fees and interest;
FIFTH, to the payment of the outstanding principal amount of
the Obligations (including the payment or cash collateralization of the
outstanding LOC Obligations);
SIXTH, to all other Obligations and other obligations which
shall have become due and payable under the Loan Documents or otherwise
and not repaid pursuant to clauses "FIRST" through "FIFTH" above; and
77
SEVENTH, to the payment of the surplus, if any, to the
Borrower or whoever else may be lawfully entitled to receive such
surplus.
In carrying out the foregoing, (i) amounts received shall be
applied in the numerical order provided until exhausted prior to
application to the next succeeding category; (ii) each of the Lenders
shall receive an amount equal to its pro rata share (based on the
proportion that the then outstanding Loans and LOC Obligations held by
such Lender bears to the aggregate then outstanding Loans and LOC
Obligations) of amounts available to be applied pursuant to clauses
"THIRD", "FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent
that any amounts available for distribution pursuant to clause "FIFTH"
above are attributable to the issued but undrawn amount of outstanding
Letters of Credit, such amounts shall be held by the Agent in a cash
collateral account and applied (A) first, to reimburse the Issuing
Lender from time to time for any drawings under such Letters of Credit
and (B) then, following the expiration of all Letters of Credit, to all
other obligations of the types described in clauses "FIFTH" and "SIXTH"
above in the manner provided in this Section 9.9.2.
9.10 ASSIGNMENTS AND PARTICIPATIONS.
9.10.1 Successors and Assigns. The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns permitted hereby,
except that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent
of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void). Nothing in this
Agreement, expressed or implied, shall be construed to confer upon any
Person (other than the parties hereto, their respective successors and
assigns permitted hereby and, to the extent expressly contemplated
hereby, the Indemnitees) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
9.10.2 Eligible Assignees. Any Lender may assign to one or
more Eligible Assignees all or a portion of its rights and obligations
under this Agreement (including all or a portion of its Commitment and
the Loans (including for purposes of this Section 9.10.2,
participations in Swingline Loans) at the time owing to it); provided
that (i) except in the case of an assignment of the entire remaining
amount of the assigning Lender's Commitment and the Loans at the time
owing to it or in the case of an assignment to a Lender or an Affiliate
of a Lender or an Approved Fund with respect to a Lender, the aggregate
amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) subject to each such assignment, determined as
of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Agent, shall not be less than $2,500,000
unless each of the Agent and, so long as no Event of Default has
occurred and is continuing, the Borrower otherwise consents (each such
consent not to be unreasonably withheld or delayed), (ii) each partial
assignment shall be made as an assignment of a proportionate part of
all the assigning Lender's rights and obligations under this Agreement
with respect to the Loans or the Commitment assigned,
78
except that this clause (ii) shall not apply to rights in respect of
outstanding Swingline Loans, (iii) each such assignment by a Lender of
any portion of its Commitment and its Revolving Credit Loans shall be
accompanied by an assignment of the same percentage of such Lender's
364-Day Commitment and its 364-Day Loans and (iv) the parties to each
assignment shall execute and deliver to the Agent an Assignment and
Acceptance, together with a processing and recordation fee of $3,500.
Subject to acceptance and recording thereof by the Agent pursuant to
subsection (c) of this Section, from and after the effective date
specified in each Assignment and Acceptance, the Eligible Assignee
thereunder shall be a party hereto and, to the extent of the interest
assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such
Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering
all of the assigning Lender's rights and obligations under this
Agreement, such Lender shall cease to be a party hereto but shall
continue to be entitled to the benefits of Sections 5.17 and 10.25).
Upon request, the Borrower (at its expense) shall execute and deliver
new or replacement Notes to the assigning Lender and the assignee
Lender. Any assignment or transfer by a Lender of rights or obligations
under this Agreement that does not comply with this subsection shall be
treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with Section
9.10.4.
9.10.3 Register. The Agent, acting solely for this purpose as
an agent of the Borrower, shall maintain at its office in Chicago,
Illinois a copy of each Assignment and Acceptance delivered to it 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 pursuant to the terms hereof from time to time (the
"Register"). The entries in the Register shall be conclusive, and the
Borrower, the Agent and the Lenders may treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to
the contrary. The Register shall be available for inspection by the
Borrower and any Lender, at any reasonable time and from time to time
upon reasonable prior notice.
9.10.4 Participations. Any Lender may, without the consent of,
or notice to, the Borrower or the Agent, sell participations to one or
more banks or other entities (a "Participant") in all or a portion of
such Lender's rights and/or obligations under this Agreement (including
all or a portion of its Commitment and/or the Loans (including such
Lender's participations in Swingline Loans) owing to it); provided that
(i) such Lender's obligations under this Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations and (iii)
the Borrower, the Agent and the other Lenders shall continue to deal
solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or
instrument pursuant to which a Lender sells such a participation shall
provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any
provision of this Agreement; provided that such agreement or instrument
may provide that such Lender will not, without the consent of the
Participant, agree to any
79
amendment, waiver or other modification that would (i) postpone any
date upon which any payment of money is scheduled to be paid to such
Participant, (ii) reduce the principal, interest, fees or other amounts
payable to such Participant or (iii) release all or substantially all
of the Guarantors from their obligations under the Loan Documents.
Subject to Section 9.10.5, the Borrower agrees that each Participant
shall be entitled to the benefits of Sections 2.7, 2.8, 2.9 and 9.13 to
the same extent as if it were a Lender and had acquired its interest by
assignment pursuant to Section 9.10.2. To the extent permitted by law,
each Participant also shall be entitled to the benefits of Section
10.23 as though it were a Lender, provided such Participant agrees to
be subject to Section 9.8 as though it were a Lender.
9.10.5 A Participant shall not be entitled to receive any
greater payment under Section 2.7, 2.8 and 2.9 than the applicable
Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower's prior
written consent. A Participant that would be a Foreign Lender if it
were a Lender shall not be entitled to the benefits of Section 9.13
unless the Borrower is notified of the participation sold to such
Participant and such Participant agrees, for the benefit of the
Borrower, to comply with Section 9.13.4 as though it were a Lender.
9.10.6 Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Agreement
(including under its Notes, if any) to secure obligations of such
Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank; provided that no such pledge or assignment shall
release a Lender from any of its obligations hereunder or substitute
any such pledgee or assignee for such Lender as a party hereto.
9.10.7 If the consent of the Borrower to an assignment or to
an Eligible Assignee is required hereunder (including a consent to an
assignment which does not meet the minimum assignment threshold
specified in clause (i) of the proviso to the first sentence of Section
9.10.2, the Borrower shall be deemed to have given its consent five
Business Days after the date notice thereof has been delivered by the
assigning Lender (through the Agent) unless such consent is expressly
refused by the Borrower prior to such fifth Business Day.
9.10.8 Notwithstanding anything to the contrary contained
herein, if at any time Bank of America assigns all of its Commitment
and Loans pursuant to subsection (b) above, Bank of America may, (i)
upon 30 days' notice to the Borrower and the Lenders resign as Issuing
Lender and/or (ii) upon 5 Business Days' notice to the Borrower, resign
as Swingline Lender. In the event of any such resignation as Issuing
Lender or Swingline Lender, the Borrower shall be entitled to appoint
from among the Lenders a successor Issuing Lender or Swingline Lender
hereunder; provided, however, that no failure by the Borrower to
appoint any such successor shall affect the resignation of Bank of
America as Swingline Lender, as the case may be. Bank of America shall
retain all the rights and obligations of the Issuing Lender hereunder
with respect to all Letters of Credit outstanding as of the effective
date of its resignation as Issuing Lender and all LOC
80
Obligations with respect thereto (including the right to require the
Lenders to make Revolving Credit Loans or fund their Participation
Interests pursuant to Section 2.17). If Bank of America resigns as
Swingline Lender, it shall retain all the rights of the Swingline
Lender provided for hereunder with respect to Swingline Loans made by
it and outstanding as of the effective date of such resignation,
including the right to require the Lenders to make Revolving Credit
Loans or fund participations in outstanding Swingline Loans pursuant to
Section 2.16.9.
9.11 PROCEDURES FOR NOTICES AND APPROVALS.
All notices given among the Lenders and the Agent with respect to this
Agreement or the other Loan Documents shall be given in the manner provided in
this Agreement.
9.12 OTHER RELATIONSHIPS WITH THE BORROWER.
Each Lender is free to engage in deposit relationships and other
business relationships with the Borrower Entities, provided that such
relationship does not violate any restriction set forth in this Agreement.
9.13 TAXES.
9.13.1 Payments. Any and all payments by the Borrower to or
for the account of any Lender or the Agent hereunder or under any other
Loan Document shall be made free and clear of and without deduction for
any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, taxes
imposed on or measured by its income or capital, and franchise taxes
imposed on it, by the jurisdiction under the laws of which such Lender
(or its Applicable Lending Office) or the Agent (as the case may be) is
organized or maintains a lending office or any political subdivision
thereof (all such non-excluded taxes, duties, levies, imposts,
deductions, charges, withholdings, and liabilities being hereinafter
referred to as "Taxes"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable under this
Agreement or any other Loan Document to any Lender or the Agent (except
as permitted under subsection (e) below), (i) the sum payable shall be
increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section 9.13) such Lender or the Agent receives an amount equal to the
sum it would have received had no such 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 furnish to the Agent, at its address referred to in Section 10.1,
the original or a certified copy of a receipt evidencing payment
thereof.
9.13.2 Other Taxes. In addition, the Borrower agrees to pay
any and all present or future stamp or documentary taxes, property
taxes and any other excise or similar taxes or charges or levies which
arise from any payment made under this Agreement or any other Loan
Document or from the execution or delivery of, or otherwise with
respect
81
to, this Agreement or any other Loan Document (hereinafter referred to
as "Other Taxes").
9.13.3 Indemnity. The Borrower agrees to indemnify each Lender
and the Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section 9.13) paid by such
Lender or the Agent (as the case may be) and any liability (including
penalties, interest, and expenses) arising therefrom or with respect
thereto.
9.13.4 Foreign Lender. Each Lender that is not a United States
person under Section 7701(a)(30) of the Code (a "Foreign Lender"), on
or prior to the date of its execution and delivery of this Agreement in
the case of each Lender listed on the signature pages hereof and on or
prior to the date on which it becomes a Lender in the case of each
other Lender, and from time to time thereafter upon the expiration or
invalidity of any previously issued certificate or if requested in
writing by the Borrower or the Agent (but only so long as such Lender
remains lawfully able to do so), shall provide the Borrower and the
Agent with (i) a properly completed and duly executed Internal Revenue
Service Form W-8 BEN or W-8 ECI, as appropriate, or any successor form
prescribed by the Internal Revenue Service, certifying that such Lender
is entitled to benefits under an income tax treaty to which the United
States is a party which reduces to zero the rate of withholding tax on
payments of interest or certifying that the income receivable pursuant
to this Agreement is effectively connected with the conduct of a trade
or business in the United States, and (ii) any other form or
certificate required by any taxing authority (including any certificate
required by Sections 871(h) and 881(c) of the Internal Revenue Code),
certifying that such Lender is entitled to an exemption from
withholding tax on payments pursuant to this Agreement or any of the
other Loan Documents. Each Lender that is a United States person shall
submit a properly completed and duly executed Internal Revenue Service
Form W-9, or any successor form prescribed by the Internal Revenue
Service, certifying that it is exempt from backup withholding.
9.13.5 Form. For any period with respect to which a Lender has
failed to provide the Borrower and the Agent with the appropriate form
pursuant to Section 9.13.4 (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 9.13.1 or 9.13.2 with respect
to Taxes imposed by the United States; provided, however, that should a
Lender, which is otherwise exempt from 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.
9.13.6 Applicable Lending Office. If the Borrower is required
to pay additional amounts to or for the account of any Lender pursuant
to this Section 9.13, then such Lender will agree to use reasonable
efforts to change the jurisdiction of its Applicable Lending Office so
as to eliminate or reduce any such additional payment which may
thereafter accrue if such change, in the judgment of such Lender, is
not otherwise disadvantageous to such Lender. In the event that any
Lender receives a refund or credit
82
in respect of Taxes for which such party has received an
indemnification from the Borrower under Section 9.13.1 or 9.13.2, such
Lender shall promptly pay to the Borrower an amount that such Lender
reasonably determines is equal to the net tax benefit obtained by such
Lender. Nothing contained in this Section shall require any Lender to
claim a refund or credit, and nothing contained in this Section shall
require a Lender to disclose or detail the basis of its calculation of
the amount of any tax benefit or any other amount.
9.13.7 Evidence of Payment. Within thirty (30) days after the
date of any payment of Taxes, the Borrower shall furnish to the Agent
the original or a certified copy of a receipt evidencing such payment.
9.13.8 Survival. Without prejudice to the survival of any
other agreement of the Borrower hereunder, the agreements and
obligations of the Borrower contained in this Section 9.13 shall
survive the repayment of the Loans and other obligations under the Loan
Documents and the termination of the Commitments hereunder.
9.14 DELEGATION OF DUTIES.
The Agent may execute any of its duties under this Agreement or any
other Loan Document by or through agents, employees or attorneys-in-fact and
shall be entitled to advice of counsel and other consultants or experts
concerning all matters pertaining to such duties. The Agent shall not be
responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects in the absence of gross negligence or willful misconduct.
9.15 LIABILITY OF AGENT.
No Agent-Related Person shall (a) be liable for any action taken or
omitted to be taken by any of them under or in connection with this Agreement or
any other Loan Document or the transactions contemplated hereby (except for its
own gross negligence or willful misconduct in connection with its duties
expressly set forth herein), or (b) be responsible in any manner to any Lender
or participant for any recital, statement, representation or warranty made by
any Credit Party or any officer thereof, contained herein or in any other Loan
Document, or in any certificate, report, statement or other document referred to
or provided for in, or received by the Agent under or in connection with, this
Agreement or any other Loan Document, or the validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document, or for any failure of any Credit Party or any other party to any Loan
Document to perform its obligations hereunder or thereunder. No Agent-Related
Person shall be under any obligation to any Lender or participant to ascertain
or to inquire as to the observance or performance of any of the agreements
contained in, or conditions of, this Agreement or any other Loan Document, or to
inspect the Facilities, books or records of any Credit Party or any Affiliate
thereof.
9.16 RELIANCE BY AGENT.
(a) The Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate,
83
affidavit, letter, telegram, facsimile, telex or telephone message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Credit Party),
independent accountants and other experts selected by the Agent. The Agent shall
be fully justified in failing or refusing to take any action under any Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action. The Agent shall in all cases be fully protected in acting,
or in refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders or all the Lenders,
if required hereunder, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and participants. Where
this Agreement expressly permits or prohibits an action unless the Required
Lenders otherwise determine, the Agent shall, and in all other instances, the
Agent may, but shall not be required to, initiate any solicitation for the
consent or a vote of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 3.1, each Lender that has signed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Agent to such Lender for consent,
approval, acceptance or satisfaction, or required thereunder to be consented to
or approved by or acceptable or satisfactory to a Lender.
9.17 OTHER AGENTS; LEAD MANAGERS.
None of the Lenders identified on the facing page or signature pages of
this Agreement as a "syndication agent," "documentation agent," "co-agent" or
"lead manager" shall have any right, power, obligation, liability,
responsibility or duty under this Agreement other than those applicable to all
Lenders as such. Without limiting the foregoing, none of the Lenders so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders so identified in deciding to enter into this Agreement or in
taking or not taking action hereunder.
X. GENERAL PROVISIONS
10.1 NOTICES.
All communications relating to this Agreement or any of the other Loan
Documents shall be in writing and shall be effective when delivered by mail,
overnight courier, special courier, telecopier or otherwise to the following
addresses:
If to the Borrower:
Renal Care Group, Inc.
Attn: Xxxx Xxxxxxx
0000 Xxxx Xxx Xxxxxx, Xxxxx 000
00
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopier: (000) 000-0000
With a Copy To:
Xxxxxx & Bird LLP
Attn: Xxxxxx X. Xxxxxx
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopier: (000) 000-0000
If to the Agent:
For notices of borrowing, payments and other administrative matters:
Bank of America, N.A.
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
For all other notices:
Bank of America, N.A.
000 X. XxXxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxxx
Telecopier: (000) 000-0000
With a copy to:
Bank of America, N.A.
Bank of America Plaza
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telecopier: (000) 000-0000
If to the Lenders:
As stated on Schedule 1.1(a) attached hereto.
Any party may change its address for receipt of notice by written
direction to the other parties hereto.
85
10.2 RENEWAL, EXTENSION, OR REARRANGEMENT.
All provisions of this Agreement relating to Obligations shall apply
with equal force and effect to each and all promissory notes executed hereafter
which in whole or in part represent a renewal, extension for any period,
increase, or rearrangement of any part of the Obligations originally represented
by any part of such other Obligations.
10.3 COUNTERPARTS.
This Agreement may be executed in counterparts with all signatures or
by counterpart signature pages, and it shall not be necessary that the
signatures of all parties be contained on any one counterpart. Each counterpart
shall be deemed an original, but all of them together shall constitute one and
the same instrument.
10.4 NEGOTIATED DOCUMENT.
This Agreement and the other Loan Documents have been negotiated by the
parties with full benefit of counsel and should not be construed against any
party as author.
10.5 CONSENT TO JURISDICTION; VENUE.
Any legal action or proceeding with respect to this Agreement or any
other Loan Document may be brought in the United States District Court for the
Northern District of Georgia and of all Georgia state courts, and by execution
and delivery of this Agreement, each of the parties hereto hereby irrevocably
accepts for itself and in respect of its property, generally and
unconditionally, the nonexclusive jurisdiction of such courts. Each of the
parties hereto further irrevocably consents to the service of process out of any
of the aforementioned courts in any such action or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, to it at the
address set out for notices pursuant to Section 10.1, such service to become
effective ten (10) days after such mailing. Nothing herein shall affect the
right of the Agent or any Lender to serve process in any other manner permitted
by law or to commence legal proceedings or to otherwise proceed against any
Credit Party in any other jurisdiction.
10.6 NOT PARTNERS; NO THIRD PARTY BENEFICIARIES.
The relationship of the Lenders and the Borrower is that of lenders and
borrower only, and neither is a fiduciary, partner or joint venturer of the
other for any purpose. This Agreement has been executed for the sole benefit of
the Lenders, and no third party is authorized to rely upon the Lenders' rights
or duties hereunder.
10.7 NO RELIANCE ON LENDERS' ANALYSIS.
The Borrower acknowledges and represents that, in connection with the
Obligations, the Borrower has not relied upon any financial projection, budget,
assessment or other analysis by the Lenders or the Agent upon any representation
by the Lenders as to the risks, benefits or prospects of the Borrower's Line of
Business activities or present or future capital needs
86
incidental thereto, all such considerations having been examined fully and
independently by the Borrower.
10.8 NO MARSHALING OF ASSETS.
The Lenders and the Agent may proceed against collateral securing the
Obligations and against parties liable therefor in such order as they may elect,
and neither the Borrower nor any surety or guarantor for the Borrower nor any
creditor of the Borrower shall be entitled to require the Lenders or the Agent
to marshal assets. The benefit of any rule of law or equity to the contrary is
hereby expressly waived.
10.9 IMPAIRMENT OF COLLATERAL.
The Lenders or the Agent (acting as permitted under this Agreement) may
release any Collateral securing the Obligations or release any party liable
therefor. The defenses of impairment of collateral and impairment of recourse
and any requirement of diligence in collecting the Obligations are hereby
waived.
10.10 BUSINESS DAYS.
If any payment date under the Obligations falls on a day that is not a
Business Day, or if the last day of any notice period falls on such a day, the
payment shall be due and the notice period shall end on the next following
Business Day.
10.11 STANDARD OF CARE; LIMITATION OF DAMAGES.
The Lenders and the Agent shall be liable to the Borrower only for
matters arising from this Agreement or otherwise related to the Obligations
resulting from such Lender's or the Agent's gross negligence or willful
misconduct, and not for matters arising from their ordinary negligence, and
liability for all other matters is hereby waived. The Lenders and the Agent
shall not in any event be liable to the Borrower for special or consequential
damages arising from this Agreement or otherwise related to the Obligations.
10.12 INCORPORATION OF SCHEDULES.
All Schedules and Exhibits referred to in this Agreement are
incorporated herein by this reference.
10.13 INDULGENCE NOT WAIVER.
The Lenders' or the Agent's indulgence in the existence of a default
hereunder or any other departure from the terms of this Agreement shall not
prejudice the Lenders' or the Agent's rights to declare a default or otherwise
demand strict compliance with this Agreement.
87
10.14 CUMULATIVE REMEDIES.
The remedies provided the Lenders and the Agent in this Agreement are
not exclusive of any other remedies that may be available to the Lenders and the
Agent under any other document or at law or equity.
10.15 AMENDMENT AND WAIVERS.
Neither this Agreement nor any other Loan Document nor any of the terms
hereof or thereof may be amended, changed, waived, discharged or terminated
unless such amendment, change, waiver, discharge or termination is in writing
entered into by, or approved in writing by, the Required Lenders and the
Borrower, provided, however, that:
(a) without the consent of each Lender affected thereby, no such
amendment, change of waiver shall:
(i) extend the final maturity of any Loan, or extend or waive
the principal payment of any Loan, or any portion thereof;
(ii) reduce the rate or extend the time of payment of interest
(other than as a result of waiving the applicability of any
post-default increase in interest rates) thereon or fees hereunder;
(iii) reduce or waive the principal amount of any Loan (except
for the waiver of a mandatory prepayment required by Section 2.13
hereof);
(iv) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver of any
Default or Event of Default or mandatory reduction in the Commitments
shall not constitute a change in the terms of any Commitment of any
Lender);
(v) release all or substantially all of the Collateral;
(vi) release the Borrower or substantially all of the
Guarantors from its or their obligations under the Loan Documents;
(vii) amend, modify or waive any provision of this Section
10.16 or Section 2.7, 2.8, 2.9, 5.17, 9.8, 9.10, 9.13, 10.23, 10.24, or
10.25.
(viii) reduce any percentage specified in, or otherwise
modify, the definition of Required Lenders; or
(ix) consent to the assignment or transfer by the Borrower or
all or substantially all of the Guarantors of any of its or their
rights and obligations under (or in respect of) the Loan Documents
except as permitted thereby;
88
(b) without the consent of the Agent, no provision of Article IX may be
amended, changed, waived, discharged or terminated;
(c) without the consent of the Swingline Lender, no provision of
Section 2.16 may be amended, changed, waived, discharged or terminated; and
(d) without the consent of the Issuing Lender, no provision of Section
2.17 or Section 2.15.3 may be amended, changed, waived, discharged or terminated
in a manner that is adverse to the Issuing Lender.
Notwithstanding the fact that the consent of all the Lenders is
required in certain circumstances as set forth above, (x) each Lender is
entitled to vote as such Lender sees fit on any bankruptcy reorganization plan
that affects the Loans, and each Lender acknowledges that the provisions of
Section 1126(c) of the Bankruptcy Code supersedes the unanimous consent
provisions set forth herein and (y) the Required Lenders may consent to allow a
Credit Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding.
10.16 ENTIRE AGREEMENT.
This Agreement and the other written agreements among the Borrower, the
Lenders and the Agent represent the entire agreement between the parties
concerning the subject matter hereof, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Credit Documents or the transactions contemplated
herein and. Provided, if there is a conflict between this Agreement and any
other document executed contemporaneously herewith with respect to the
Obligations, the provision in this Agreement shall control.
10.17 SEVERABILITY.
Should any provision of any of the Loan Documents be declared illegal,
invalid or unenforceable for any reason, such provision shall be fully severable
and the remaining provisions hereof shall remain in full force and effect and
shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
10.18 TIME OF ESSENCE.
Time is of the essence of this Agreement, and all dates and time
periods specified herein shall be strictly observed.
10.19 GOVERNING LAW.
This Agreement and the other Loan Documents and all other documents
executed with respect to the Obligations and the rights and obligations of the
parties hereunder and thereunder shall be governed by and construed in
accordance with the laws of the State of Georgia.
89
10.20 CAPTIONS NOT CONTROLLING.
Captions and headings have been included in this Agreement for the
convenience of the parties, and shall not be construed as affecting the content
of the respective Sections.
10.21 WAIVER OF RIGHT TO JURY TRIAL.
TO THE EXTENT PERMITTED BY LAW, EACH OF THE AGENT, THE LENDERS AND EACH
OF THE CREDIT PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
10.22 FACSIMILE SIGNATURES.
This Agreement may be executed by facsimile signatures, and shall be
effective when the Agent has received telecopy transmissions of the signature
pages executed by all parties hereto; provided, however, that all parties shall
deliver original executed documents to the Agent promptly following the
execution hereof.
10.23 RIGHT OF SET-OFF; ADJUSTMENTS.
Upon the occurrence and during the continuance of any Event of Default,
each Lender (and each of its Affiliates) is hereby authorized at any time and
from time to time, to the fullest extent permitted by law, 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 such Lender (or any
of its Affiliates) to or for the credit or the account of any Credit Party
against any and all of the obligations of such Person now or hereafter existing
under this Agreement, under the Notes, under any other Loan Document or
otherwise, irrespective of whether such Lender shall have made any demand
hereunder or thereunder and although such obligations may be unmatured. Each
Lender agrees promptly to notify any affected Credit Party after any such
set-off and application made by such Lender; provided, however, that the failure
to give such notice shall not affect the validity of such set-off and
application. The rights of each Lender under this Section 10.23 are in addition
to other rights and remedies (including, without limitation, other rights of
set-off) that such Lender may have.
10.24 CONFIDENTIALITY.
Each of the Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its and its Affiliates' directors, officers, employees
and agents, including accountants, legal counsel and other advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such Information and instructed to keep such
Information confidential); (b) to the extent requested by any regulatory
authority; (c) to the extent required by applicable laws or regulations or by
any subpoena or similar legal process; (d) to any other party to this Agreement;
(e) in connection with the exercise of any remedies hereunder or any
90
suit, action or proceeding relating to this Agreement or the enforcement of
rights hereunder; (f) subject to an agreement containing provisions
substantially the same as those of this Section, to (i) any Eligible Assignee of
or Participant in, or any prospective Eligible Assignee of or Participant in,
any of its rights or obligations under this Agreement or (ii) any direct or
indirect contractual counterparty or prospective counterparty (or such
contractual counterparty's or prospective counterparty's professional advisor)
to any credit derivative transaction relating to obligations of the Borrower;
(g) with the consent of the Borrower; (h) to the extent such Information (i)
becomes publicly available other than as a result of a breach of this Section or
(ii) becomes available to the Agent or any Lender on a nonconfidential basis
from a source other than the Borrower; or (i) to the National Association of
Insurance Commissioners or any other similar organization or any nationally
recognized rating agency that requires access to information about a Lender's or
its Affiliates' investment portfolio in connection with ratings issued with
respect to such Lender or its Affiliates. For the purposes of this Section,
"Information" means all information received from the Borrower relating to the
Borrower or its business, other than any such information that is available to
the Agent or any Lender on a nonconfidential basis prior to disclosure by the
Borrower; provided that, in the case of information received from the Borrower
after the date hereof, such information is clearly identified in writing at the
time of delivery as confidential. Any Person required to maintain the
confidentiality of Information as provided in this Section shall be considered
to have complied with its obligation to do so if such Person has exercised the
same degree of care to maintain the confidentiality of such Information as such
Person would accord to its own confidential information.
10.25 NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Agent or any Lender in
exercising any right, power or privilege hereunder or under any other Loan
Document and no course of dealing between the Agent or any Lender and any of the
Credit Parties shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or under any other
Loan Document preclude any other or further exercise thereof or the exercise of
any other right, power or privilege hereunder or thereunder. The rights and
remedies provided herein are cumulative and not exclusive of any rights or
remedies which the Agent or any Lender would otherwise have. No notice to or
demand on any Credit Party in any case shall entitle the Borrower or any other
Credit Party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Agent or the Lenders
to any other or further action in any circumstances without notice or demand.
10.26 SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 2.9, 9.4, 9.13, or 5.17 shall survive the execution and delivery of this
Agreement, the making of the Loans, the issuance of the Letters of Credit, the
repayment of the Loans, LOC Obligations and other obligations under the Loan
Documents and the termination of the Commitments hereunder, and all
representations and warranties made by the Credit Parties herein shall survive
until this Agreement shall be terminated in accordance with the terms hereof.
91
Executed as of the date first written above.
RENAL CARE GROUP, INC. a Delaware
corporation
By: /s/ R. Xxxx Xxxxxxx
--------------------------------------
Name: R. Xxxx Xxxxxxx
-------------------------------------
Title: Executive Vice President
------------------------------------
BANK OF AMERICA, N.A., as Agent
By: /s/ Xxxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxxx Xxxxxxx
-------------------------------------
Title: Vice President
------------------------------------
BANK OF AMERICA, N.A.,
as a Lender
By: /s/ Xxxxx Xxxxxxx
---------------------------------------
Name: Xxxxx Xxxxxxx
-------------------------------------
Title: Senior Vice President
------------------------------------
SUNTRUST BANK,
as a Lender
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
-------------------------------------
Title: Vice President
------------------------------------
AMSOUTH BANK,
as a Lender
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxx
-------------------------------------
Title: Vice President
------------------------------------
XXXXX FARGO BANK, NATIONAL ASSOCIATION
as a Lender
By: /s/ Xxxxxxx Xxxxx
---------------------------------------
Name: Xxxxxxx Xxxxx
-------------------------------------
Title: Vice President
------------------------------------
Exhibit 1.3
SWINGLINE NOTE
$10,000,000 ___________, 2002
FOR VALUE RECEIVED, Renal Care Group, Inc., a Delaware corporation (the
"Borrower"), promises to pay to the order of BANK OF AMERICA, N.A. (the
"Swingline Lender"), the sum of Ten Million and No/100 Dollars ($10,000,000.00),
or as much thereof as may be outstanding from time to time, together with
interest thereon as provided in that Second Amended and Restated Loan Agreement
dated as of July ___, 2002 among the Borrower, the Lenders party thereto and
Bank of America, N.A. (formerly NationsBank of Tennessee, N.A.), as agent (the
"Agent") (as renewed, extended, amended, restated or modified from time to time,
the "Loan Agreement"). All capitalized terms used herein but not otherwise
defined shall have the meanings ascribed to such terms in the Loan Agreement.
This Note evidences the Swingline Loan. Reference is made to the Loan
Agreement for the terms of payment of principal and interest hereunder, for a
description of the rights of the Agent, to enforce this Note, and for additional
provisions regarding additional payments, prepayment, draws and other terms and
conditions applicable to the indebtedness evidenced by this Note. As provided in
the Loan Agreement, (i) all remaining principal, interest and expenses
outstanding hereunder or under the Loan Agreement shall become finally due on
the Maturity Date, and (ii) the sum of the outstanding principal balance
hereunder plus the outstanding principal balance of the Revolving Credit Loans
plus the aggregate principal amount of LOC Obligations outstanding may not
exceed $100,000,000 in the aggregate at any time.
As provided in the Loan Agreement, interest hereunder shall be
calculated based upon a 360-day year and actual days elapsed. As also provided
further in the Loan Agreement, the interest rate required hereby shall not
exceed the maximum rate permissible under applicable law, and any amounts paid
in excess of such rate shall be applied to reduce the principal amount hereof or
shall be refunded to the Borrower, at the option of the Swingline Lender.
Subject to the provisions of the Loan Agreement, the Borrower may
borrow, repay and reborrow amounts hereunder from time to time, provided that
the Borrower is not in default hereunder or under the Loan Agreement and
provided that all conditions to the Swingline Lender's obligation to fund
advances as set forth in the Loan Agreement are satisfied. The Swingline Lender
shall have no liability for its refusal to advance funds hereunder following a
determination that any condition precedent to the making of an advance has not
been satisfied.
The Swingline Lender's records of the amounts advanced hereunder shall
be prima facie evidence thereof, absent manifest error.
The occurrence of an Event of Default under the Loan Agreement shall
constitute an Event of Default under this Note.
1
Upon the occurrence of an Event of Default, the Swingline Lender may,
at its option and without notice (except as provided in the Loan Agreement), and
acting through the Agent in accordance with the Loan Agreement, declare all
principal and interest provided for under this Note, to be presently due and
payable, and may enforce any remedies available to the Swingline Lender under
any documents securing or evidencing debts of the Borrower to the Swingline
Lender. Upon an Event of Default, the remaining unpaid principal balance of the
indebtedness evidenced hereby and all expenses due the Swingline Lender shall
bear interest at the Default Rate, as defined in the Loan Agreement.
All amounts received for payment of this Note shall be applied in
accordance with the Loan Agreement.
The Borrower and all sureties, guarantors, endorsers and other parties
to this instrument hereby consent to any and all renewals, waivers,
modifications, or extensions of time (of any duration) that may be granted by
the Swingline Lender with respect to this Note and severally waive demand,
presentment, protest, notice of dishonor, and all other notices that might
otherwise be required by law, except as set forth in the Loan Agreement. All
parties hereto waive the defense of impairment of collateral and all other
defenses of suretyship, if applicable.
The Borrower's performance under this Note is secured by various
property, as described in the Loan Agreement.
The Borrower and all sureties, guarantors, endorsers and other parties
hereto agree to pay reasonable attorneys' fees and all court and other costs
that the Swingline Lender may incur in the course of efforts to collect the debt
evidenced hereby or to protect the Swingline Lender's interest in any collateral
securing the same, to the extent permitted by the Loan Agreement.
The validity and construction of this Note shall be determined
according to the laws of Georgia applicable to contracts executed and performed
within that state and applicable federal law. If any provision of this Note
should for any reason be invalid or unenforceable, the remaining provisions
hereof shall remain in full effect.
2
Words used herein indicating gender or number shall be read as context
may require.
RENAL CARE GROUP, INC., a Delaware corporation
By:
-------------------------------------------
Name:
------------------------------------------
Title:
----------------------------------------
3
Exhibit 2.3
REVOLVING CREDIT NOTE
$__,000,000.00 _________, 2002
FOR VALUE RECEIVED, Renal Care Group, Inc., a Delaware corporation (the
"Borrower"), promises to pay to the order of _________________________________
(the "Lender") the sum of __________________________Million and No/100 Dollars
($__,000,000.00) (or such lesser amount as shall equal the aggregate unpaid
principal amount of the Revolving Credit Loans made by the Lender to the
Borrower under the Loan Agreement), together with interest thereon as provided
in that Second Amended and Restated Loan Agreement dated as of July ___, 2002
among the Borrower, the Lenders party thereto and Bank of America, N.A.
(formerly NationsBank of Tennessee, N.A.) as agent (the "Agent") (as renewed,
extended, amended, restated or modified from time to time, the "Loan
Agreement"). All capitalized terms used herein but not otherwise defined shall
have the meanings ascribed to such terms in the Loan Agreement.
This Note is one of the Revolving Notes referred to in the Loan
Agreement and evidences the Revolving Credit Loans made by the Lender
thereunder. Reference is made to the Loan Agreement for the terms of payment of
principal and interest hereunder, for a description of the rights of the Agent
to enforce this Note, and for additional provisions regarding additional
payments, prepayment, draws and other terms and conditions applicable to the
indebtedness evidenced by this Note. As provided in the Loan Agreement, all
remaining principal, interest and expenses outstanding hereunder or under the
Loan Agreement shall become finally due on the Maturity Date.
As provided in the Loan Agreement, interest hereunder shall be
calculated based upon a 360-day year and actual days elapsed. As also provided
further in the Loan Agreement, the interest rate required hereby shall not
exceed the maximum rate permissible under applicable law, and any amounts paid
in excess of such rate shall be applied to reduce the principal amount hereof or
shall be refunded to the Borrower, at the option of the Lender.
Subject to the provisions of the Loan Agreement, the Borrower may
borrow, repay and reborrow amounts hereunder from time to time, provided that
the Borrower is not in default hereunder or under the Loan Agreement and
provided that all conditions to the Lender's obligation to fund advances as set
forth in the Loan Agreement are satisfied. The Lender shall have no liability
for its refusal to advance funds hereunder following a determination that any
condition precedent to the making of an advance has not been satisfied.
The date, amount, type, interest rate and duration of Interest Period
(if applicable) of each Revolving Credit Loan made by the Lender to the
Borrower, and each payment made on account of the principal thereof, shall be
recorded by the Lender on its books; provided that the failure of the Lender to
make any such recordation or endorsement shall not affect the obligations of the
Borrower to make a payment when due of any amount owing hereunder or under this
Note in
respect of the Revolving Credit Loans to be evidenced by this Note, and each
such recordation or endorsement shall be prima facie evidence of such
information.
The occurrence of an Event of Default under the Loan Agreement shall
constitute an Event of Default under this Note.
Upon the occurrence of an Event of Default, the Lender may, at its
option and without notice (except as provided in the Loan Agreement), and acting
through the Agent in accordance with the Loan Agreement, declare all principal
and interest provided for under this Note, to be presently due and payable, and
may enforce any remedies available to the Lender under any documents securing or
evidencing debts of the Borrower to the Lender. Upon an Event of Default, the
remaining unpaid principal balance of the indebtedness evidenced hereby and all
expenses due the Lender shall bear interest at the Default Rate, as defined in
the Loan Agreement.
All amounts received for payment of this Note shall be applied in
accordance with the Loan Agreement.
The Borrower and all sureties, guarantors, endorsers and other parties
to this instrument hereby consent to any and all renewals, waivers,
modifications, or extensions of time (of any duration) that may be granted by
the Lender with respect to this Note and severally waive demand, presentment,
protest, notice of dishonor, and all other notices that might otherwise be
required by law, except as set forth in the Loan Agreement. All parties hereto
waive the defense of impairment of collateral and all other defenses of
suretyship, if applicable.
The Borrower's performance under this Note is secured by various
property, as described in the Loan Agreement.
The Borrower and all sureties, guarantors, endorsers and other parties
hereto agree to pay reasonable attorneys' fees and all court and other costs
that the Lender may incur in the course of efforts to collect the debt evidenced
hereby or to protect the Lender's interest in any collateral securing the same,
as further provided in the Loan Agreement.
The validity and construction of this Note shall be determined
according to the laws of Georgia applicable to contracts executed and performed
within that state and applicable federal law. If any provision of this Note
should for any reason be invalid or unenforceable, the remaining provisions
hereof shall remain in full effect.
Words used herein indicating gender or number shall be read as context
may require.
This Note and the Revolving Credit Loans evidenced hereby may be
transferred in whole or in part only by registration of such transfer on the
Register maintained for such purpose by or on behalf of the Borrower as provided
in Section 9.10 of the Loan Agreement.
2
RENAL CARE GROUP, INC., a Delaware corporation
By:
------------------------------------------
Name:
-----------------------------------------
Title:
---------------------------------------
3
EXHIBIT 2.5.1(B)
BORROWING/CONVERSION NOTICE
Date: __________, 200_
The Agent: Bank of America, N.A., as Agent
000 Xxxxx Xxxxx Xxxxxx
XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attention: Agency Services
Borrower: Renal Care Group, Inc.
This notice is delivered under the Second Amended and Restated Loan
Agreement (as renewed, extended, amended, restated or modified from time to
time, the "Loan Agreement") dated as of July ___, 2002, among the Borrower, the
Lenders and Bank of America, N.A., as agent. Terms defined in the Loan Agreement
have the same meanings when used -- unless otherwise defined -- in this request.
The Borrower requests a Revolving Credit Loan under the Loan Agreement
as follows:
Borrowing Date _____________, 200_
Amount of Borrowing $__________________
Type of Borrowing (LIBOR or Base) __________________
For LIBOR Loans, the Interest Period ____________ months
The Borrower certifies that on the date hereof and on the date of the
above Borrowing Date - both before and after giving effect to the requested
Revolving Credit Loan -- (a) all of the representations and warranties in the
Loan Documents will be true and correct in all material respects (except those
which expressly relate to an earlier date), (b) no Default or Event of Default
exists and is continuing or would be caused by the requested borrowing, (c) all
conditions to the Borrower's right to receive the requested Loan under the Loan
Agreement have been and will have been satisfied and (d) immediately after
giving effect to the requested borrowing, the sum of the aggregate principal
amount of all outstanding Revolving Credit Loans plus Swingline Loans
outstanding plus the aggregate principal amount of LOC Obligations outstanding
shall not exceed the total amount of the Commitments.
RENAL CARE GROUP, INC., a Delaware corporation
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
2
Exhibit 3.1.l(d)
AMENDED AND RESTATED
GUARANTY AGREEMENT
THIS AMENDED AND RESTATED GUARANTY AGREEMENT (the "Guaranty") is
executed as of July ___, 2002 by the Guarantors (as defined herein) in favor of
BANK OF AMERICA, N.A. (formerly NationsBank of Tennessee, N.A.), as agent (the
"Agent") for the Lenders party to the Loan Agreement identified below and amends
and restates that certain Unconditional Joint and Several Guaranty dated as of
August ___, 1997 executed by certain of the Guarantors in favor of certain of
the Lenders and the Agent.
WITNESSETH:
WHEREAS, Renal Care Group, Inc., a Delaware corporation (the
"Borrower"), the Agent and certain lenders (the "Lenders") have entered into
that certain Second Amended and Restated Loan Agreement dated as of July ___,
2002 (as amended, supplemented, restated or otherwise modified from time to
time, the "Loan Agreement") (the Lenders and the Agent are referred to herein
collectively as the "Lender Parties"); and
WHEREAS, this Guaranty is a condition precedent to the effectiveness of
the Loan Agreement and the obligations of the Lenders to make loans and
extensions of credit to the Borrower under the Loan Agreement.;
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Guarantors hereby agree as follows:
SECTION 1
DEFINITIONS
1.1 CERTAIN DEFINITIONS.
Unless otherwise defined herein, capitalized terms used herein shall
have the meanings ascribed to such terms in the Loan Agreement.
"Default" means any event, act or condition that, but for the
giving of any required notice by the Agent and/or the passing of time,
would be an Event of Default hereunder.
"Guaranteed Obligations" means (i) the present and future
obligations of the Borrower to the Lenders (including the Issuing
Lender) to repay the Revolving Credit Loans, the Swingline Loans, and
all other obligations of the Borrower and the other Borrower Entities
to the Lenders and to the Agent, whenever arising, under the Loan
Agreement and the other Loan Documents (including, but not limited to,
any interest accruing after the occurrence of a Bankruptcy Event with
respect to the Borrower or any other Borrower Entity, regardless of
whether such interest is an allowed claim under the
Bankruptcy Code), and (ii) the present and future obligations of the
Borrower to any Lender or any Affiliate of a Lender with respect to any
Interest Rate Swap Obligations.
"Guarantors" means the collective reference to each of the
Persons identified as a Guarantor on the signature pages hereto and
each Additional Credit Party which has executed a Joinder Agreement,
together with their successors and assigns, and "Guarantor" means any
one of them.
SECTION 2
GUARANTY
2.1 THE GUARANTY.
Each Guarantor hereby guarantees to each Lender, each Affiliate of a
Lender that enters into a Hedging Agreement, and the Agent as hereafter
provided, as primary obligor and not as surety, the prompt payment of the
Guaranteed Obligations in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise) strictly in accordance with the terms thereof. Each Guarantor hereby
further agrees that if any of the Guaranteed Obligations are not paid in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or otherwise), the
Guarantors will promptly pay the same, without any demand or notice whatsoever
(except for any such notice required by the Loan Agreement), and that in the
case of any extension of time of payment or renewal of any of the Guaranteed
Obligations, the same will be promptly paid in full when due (whether at
extended maturity, as a mandatory prepayment, by acceleration, as a mandatory
cash collateralization or otherwise) in accordance with the terms of such
extension or renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Loan Documents or Hedging Agreements, the obligations of the
Guarantors hereunder and the other Loan Documents shall be limited to an
aggregate amount equal to the largest amount that would not render such
obligations subject to avoidance under Section 548 of the Bankruptcy Code or any
comparable provisions of any applicable state law.
2.2 OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 2.1 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Loan Documents or Hedging
Agreements, or any other agreement or instrument referred to therein, or any
substitution, compromise, release, impairment or exchange of any other guarantee
of or security for any of the Guaranteed Obligations, and, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor, it being the intent of this Section 2.2 that the
obligations of the Guarantors hereunder shall be absolute and unconditional
under any and all circumstances. Each Guarantor agrees that it shall have no
right of subrogation, indemnity,
4
reimbursement or contribution against the Borrower or any other guarantor for
amounts paid under this Section 2 until such time as the Lenders (and any
Affiliates of the Lenders entering into Hedging Agreements) have been paid in
full, all Commitments under the Loan Agreement have been terminated and no
Person or Governmental Authority shall have any right to request any return or
reimbursement of funds from the Lenders in connection with monies received under
the Loan Documents or Hedging Agreements. Without limiting the generality of the
foregoing, it is agreed that, to the fullest extent permitted by law, the
occurrence of any one or more of the following shall not alter or impair the
liability of the Guarantors hereunder which shall remain absolute and
unconditional as described above:
(a) at any time or from time to time, without notice to the
Guarantor, the time for any performance of or compliance with any of
the Guaranteed Obligations shall be extended, or such performance or
compliance shall be waived;
(b) any of the acts mentioned in any of the provisions of any
of the Loan Documents or Hedging Agreements or any other agreement or
instrument referred to in the Loan Documents or Hedging Agreements
shall be done or omitted;
(c) the maturity of any of the Guaranteed Obligations shall be
accelerated, or any of the Guaranteed Obligations shall be modified,
supplemented or amended in any respect, or any right under any of the
Loan Documents or Hedging Agreements or any other agreement or
instrument referred to in the Loan Documents or Hedging Agreements
shall be waived, or any other guarantee of any of the Guaranteed
Obligations or any security therefor shall be released, impaired or
exchanged in whole or in part or otherwise dealt with;
(d) any Encumbrance granted to, or in favor of, the Agent or
any Lender or Lenders as security for any of the Guaranteed Obligations
shall fail to attach or be perfected; or
(e) any of the Guaranteed Obligations shall be determined to
be void or voidable (including, without limitation, for the benefit of
any creditor of the Guarantor) or shall be subordinated to the claims
of any Person (including, without limitation, any creditor of a
Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest, notice of acceptance
of this Guaranty and of extensions of credit which may constitute Guaranteed
Obligations, notice of amendments, waivers or supplements to the Loan Documents
(except for any such notice required by the Loan Agreement) or Hedging
Agreements or the compromise, release or exchange of collateral or security and
all other notices whatsoever, and any requirement that the Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Loan Documents or Hedging Agreements or any other agreement or instrument
referred to in the Loan Documents or against any other Person under any other
guarantee of, or security for, any of the Guaranteed Obligations.
5
2.3 REINSTATEMENT.
Neither the Guarantors' obligations hereunder nor any remedy for the
enforcement thereof shall be impaired, modified, changed or released in any
manner whatsoever by an impairment, modification, change, release or limitation
of the liability of the Borrower, by reason of the Borrower's bankruptcy or
insolvency or by reason of the invalidity or unenforceability of all or any
portion of the Guaranteed Obligations. The obligations of the Guarantors under
this Guaranty shall be automatically reinstated if and to the extent that for
any reason any payment by or on behalf of any Person in respect of the
Guaranteed Obligations is rescinded or must be otherwise restored by any holder
of any of the Guaranteed Obligations, whether as a result of any proceedings in
bankruptcy or reorganization or otherwise, and the Guarantor agrees that it will
indemnify the Agent and each Lender on demand for all costs and expenses
(including, without limitation, reasonable fees and expenses of counsel)
incurred by the Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
2.4 CERTAIN ADDITIONAL WAIVERS.
Each of the Guarantors agrees that this Guaranty may be enforced by the
Agent and the Lenders without the necessity of resorting to or exhausting any
other security or collateral and without the necessity at any time of having
recourse to the Borrower under the Loan Agreement, any Hedging Agreement or any
collateral securing the Guaranteed Obligations or otherwise, and the Guarantor
agrees not to assert any right to require the Agent and the Lenders to proceed
against the Borrower or any other Person (including any co-guarantor) or to
require the Agent and the Lenders to pursue any other remedy or enforce any
other right. Each Guarantor further acknowledges and agrees that nothing
contained in this Guaranty shall prevent the Agent or the Lenders from suing the
Borrower in respect of its obligations under the Loan Agreement, any Hedging
Agreement and the other Loan Documents or foreclosing on any security interest
or lien on any collateral securing the Guaranteed Obligations or from exercising
any other rights available to the Agent and the Lenders under the Loan Documents
or Hedging Agreements if neither the Borrower nor the Guarantors timely perform
their obligations, and the exercise of any of such rights and completion of any
such foreclosure proceedings shall not constitute a discharge of any of the
Guarantors' obligations hereunder unless as a result thereof the Guaranteed
Obligations shall have been paid in full and all of the Commitments shall have
terminated or expired, it being the purpose and intent that the Guarantor's
obligations hereunder be absolute, irrevocable, independent and unconditional
under all circumstances.
2.5 REMEDIES.
Each Guarantor agrees that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Agent and the Lenders, on the
other hand, the Guaranteed Obligations may be declared to be forthwith due and
payable as provided in Section 8.2 of the Loan Agreement (and shall be deemed to
have become automatically due and payable in the circumstances provided in said
Section 8.2 of the Loan Agreement) for purposes of Section 2.1 notwithstanding
any stay, injunction or other prohibition preventing such declaration (or
6
preventing such Guaranteed Obligations from becoming automatically due and
payable) as against any other Person and that, in the event of such declaration
(or such Guaranteed Obligations being deemed to have become automatically due
and payable), such Guaranteed Obligations (whether or not due and payable by any
other Person) shall forthwith become due and payable by the Guarantor for
purposes of Section 2.1.
2.6 CERTAIN REPRESENTATIONS AND WARRANTIES.
The Guarantors agree that the Agent and the Lenders will have no
obligation to investigate the financial condition or affairs of the Borrower for
the benefit of the Guarantors nor to advise the Guarantors of any fact
respecting, or any change in, the financial condition or affairs of the Borrower
which might come to the knowledge of the Agent or any Lender at any time,
whether or not the Agent or any Lender knows or believes or has reason to know
or believe that any such fact or change is unknown to the Guarantors or might
(or does) materially increase the risk of the Guarantors as guarantors or might
(or would) affect the willingness of the Guarantors to continue as guarantors
with respect to the Guaranteed Obligations.
2.7 ADDITIONAL LIABILITY OF GUARANTORS.
If any Guarantor is or becomes liable for any indebtedness owing by
such Guarantor to the Agent or any Lender by endorsement or otherwise other than
under this Guaranty, such liability shall not be in any manner impaired or
reduced hereby but shall have all and the same force and effect it would have
had if this Guaranty had not existed and the Guarantors' liability hereunder
shall not be in any manner impaired or reduced thereby.
2.8 GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guaranty in this Section 2 is a guaranty of payment and not of
collection, is a continuing guaranty, and shall apply to all Guaranteed
Obligations whenever owing.
2.9 RIGHTS OF CONTRIBUTION.
The Guarantors hereby agree as among themselves that, if any Guarantor
shall make an Excess Payment (as defined below), such Guarantor shall have a
right of contribution from each other Guarantor in an amount equal to such other
Guarantor's Contribution Share (as defined below) of such Excess Payment. The
payment obligations of any Guarantor under this Section 2.9 shall be subordinate
and subject in right of payment to the prior payment in full to the Agent and
the Lenders of the Guaranteed Obligations, and none of the Guarantors shall
exercise any right or remedy under this Section 2.9 against any other Guarantor
until payment and satisfaction in full of all of such Guaranteed Obligations.
For purposes of this Section 2.9, (a) "Excess Payment" shall mean the amount
paid by any Guarantor in excess of its Pro Rata Share of any Guaranteed
Obligations; (b) "Pro Rata Share" shall mean, for any Guarantor in respect of
any payment of Guaranteed Obligations, the ratio (expressed as a percentage) as
of the date of such payment of Guaranteed Obligations of (i) the amount by which
the aggregate present fair salable value of all of its assets and facilities
exceeds the amount of all debts and liabilities of such Guarantor (including
contingent, subordinated, unmatured, and unliquidated
7
liabilities, but excluding the obligations of such Guarantor hereunder) to (ii)
the amount by which the aggregate present fair salable value of all assets and
other facilities of the Borrower and all of the Guarantors exceeds the amount of
all of the debts and liabilities (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of the Borrower and
the Guarantors hereunder) of the Borrower and all of the Guarantors; provided,
however, that, for purposes of calculating the Pro Rata Shares of the Guarantors
in respect of any payment of Guaranteed Obligations, any Guarantor that became a
Guarantor subsequent to the date of any such payment shall be deemed to have
been a Guarantor on the date of such payment and the financial information for
such Guarantor as of the date such Guarantor became a Guarantor shall be
utilized for such Guarantor in connection with such payment; and (c)
"Contribution Share" shall mean, for any Guarantor in respect of any Excess
Payment made by any other Guarantor, the ratio (expressed as a percentage) as of
the date of such Excess Payment of (i) the amount by which the aggregate present
fair salable value of all of its assets and facilities exceeds the amount of all
debts and liabilities of such Guarantor (including contingent, subordinated,
unmatured, and unliquidated liabilities, but excluding the obligations of such
Guarantor hereunder) to (ii) the amount by which the aggregate present fair
salable value of all assets and other facilities of the Borrower and all of the
Guarantors other than the maker of such Excess Payment exceeds the amount of all
of the debts and liabilities (including contingent, subordinated, unmatured, and
unliquidated liabilities, but excluding the obligations of the Borrower and the
Guarantors hereunder) of the Borrower and all of the Guarantors other than the
maker of such Excess Payment; provided, however, that, for purposes of
calculating the Contribution Shares of the Guarantors in respect of any Excess
Payment, any Guarantor that became a Guarantor subsequent to the date of any
such Excess Payment shall be deemed to have been a Guarantor on the date of such
Excess Payment and the financial information for such Guarantor as of the date
such Guarantor became a Guarantor shall be utilized for such Guarantor in
connection with such Excess Payment. This Section 2.9 shall not be deemed to
affect any right of subrogation, indemnity, reimbursement or contribution that
any Guarantor may have under applicable law against the Borrower in respect of
any payment of Guaranteed Obligations.
SECTION 3
REPRESENTATIONS, WARRANTIES AND COVENANTS
The representations and warranties contained in Section IV of the Loan
Agreement (the "Incorporated Representations") and the affirmative and negative
covenants contained in Sections V and VI of the Loan Agreement (the
"Incorporated Covenants") are incorporated herein by reference, mutatis
mutandis, for the benefit of the Agent and the Lenders to the same extent and
with the same effect as if set forth fully herein (such incorporation to include
all other relevant provisions of the Loan Agreement related thereto, including
without limitation the defined terms contained in Section 1 thereof which are
used in the Incorporated Representations and the Incorporated Covenants). Each
Guarantor affirms and represents and warrants to the Agent and the Lenders that
the Incorporated Representations are true and correct in all material respects
as of the date hereof and covenants and agrees that the Incorporated Covenants
shall be as binding on the Guarantors as if set forth fully herein.
8
SECTION 4
EVENTS OF DEFAULT
4.1 EVENTS OF DEFAULT.
The occurrence of an event which would constitute an Event of Default
under the Loan Agreement shall be an Event of Default hereunder (each an "Event
of Default").
4.2 REMEDIES.
Upon the occurrence of an Event of Default, and at any time thereafter
unless and until such Event of Default has been waived by the requisite Lenders
(pursuant to the voting requirements of Section 10.15 of the Loan Agreement) or
cured to the satisfaction of the requisite Lenders (pursuant to the voting
procedures in Section 10.15 of the Loan Agreement), the Agent may, or shall,
upon the request and direction of the Required Lenders, by written notice to the
Credit Parties, enforce any and all rights and interests created and existing
under the Loan Documents including, without limitation, all rights and remedies
existing under the Collateral Documents (including, without limitation, this
Guaranty), all rights and remedies against the Guarantor and all rights of
set-off.
SECTION 5
MISCELLANEOUS
5.1 CUMULATIVE RIGHTS.
All rights of the Agent and the Lenders hereunder or otherwise arising
under any documents executed in connection with or as security for the
Guaranteed Obligations are separate and cumulative and may be pursued
separately, successively or concurrently, or not pursued, without affecting or
limiting any other right of the Agent or any Lender and without affecting or
impairing the liability of the Guarantors.
5.2 USURY.
Notwithstanding any other provisions herein contained, no provision of
this Guaranty shall require or permit the collection from the Guarantors of
interest in excess of the maximum rate or amount that the Guarantors may be
required or permitted to pay pursuant to any applicable law. In the event any
such interest is collected, it shall be applied in reduction of the Guarantors'
obligations hereunder, and the remainder of such excess collected shall be
returned to the Guarantors once such obligations have been fully satisfied.
5.3 RIGHT OF SET-OFF.
After the occurrence of an Event of Default, any Lender may set-off any
matured obligation owed by the Guarantors under this Guaranty (to the extent
beneficially owned or held
9
by such Lender) against any obligation (whether or not matured) owed by such
Lender to any Guarantor, regardless of the place of payment.
5.4 TERM OF GUARANTEE.
This Guaranty shall continue in full force and effect until the
Guaranteed Obligations are fully and indefeasibly paid, performed and discharged
and all Commitments have expired or been terminated. This Guaranty covers the
Guaranteed Obligations whether presently outstanding or arising subsequent to
the date hereof including all amounts advanced by the Agent or any Lender in
stages or installments.
5.5 THE AGENT.
In acting under or by virtue of this Guaranty, the Agent shall be
entitled to all the rights, authority, privileges and immunities provided in the
Loan Agreement, all of which provisions are incorporated by reference herein
with the same force and effect as if set forth herein.
5.6 SUCCESSORS AND ASSIGNS.
This Guaranty shall be binding on and enforceable against the Guarantor
and its successors and assigns; provided that, the Guarantor may not assign or
transfer any of its obligations hereunder without prior written consent of the
Lenders. This Guaranty is intended for and shall inure to the benefit of the
Agent and each Lender and each and every person who shall from time to time be
or become the owner or holder of any of the Guaranteed Obligations, and each and
every reference herein to the "Agent" or the "Lender" shall include and refer to
each and every successor or assignee of the Agent or any Lender at any time
holding or owning any part of or interest in any part of the Guaranteed
Obligations. This Guaranty shall be transferable and negotiable with the same
force and effect, and to the same extent, that the Guaranteed Obligations are
transferable and negotiable, it being understood and stipulated that upon
assignment or transfer by the Agent or any Lender of any of the Guaranteed
Obligations the legal holder or owner of the Guaranteed Obligations (or a part
thereof or interest therein thus transferred or assigned by the Agent or any
Lender) shall (except as otherwise stipulated by the Agent or any such Lender in
its assignment) have and may exercise all of the rights granted to the Agent or
such Lender under this Guaranty to the extent of that part of or interest in the
Guaranteed Obligations thus assigned or transferred to said person. The
Guarantor expressly waives notice of transfer or assignment by the Lenders of
the Guaranteed Obligations, or any part thereof, or of the rights of the Agent
or any Lender hereunder. Failure to give notice will not affect the liabilities
of the Guarantor hereunder.
5.7 APPLICATION OF PAYMENTS.
Each of the Agent and the Lenders may apply any payments received by it
from any source against that portion of the Guaranteed Obligations (principal,
interest, court costs, attorneys' fees or other) as set forth in Section 9.9 of
the Loan Agreement.
10
5.8 MODIFICATIONS.
This Guaranty and the provisions hereof may not be amended, waived,
modified, changed, discharged or terminated except as set forth in Section 10.15
of the Loan Agreement.
5.9 NOTICES.
All communications with the parties hereto relating to this Guaranty or
any of the other Loan Documents shall be in writing and shall be effective when
delivered by mail, overnight courier, special courier, telecopier or otherwise
to the following addresses:
If to any Guarantor:
Renal Care Group, Inc.
Attn: Xxxx Xxxxxxx
0000 Xxxx Xxx Xxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxxx 00000
Telecopier: (000) 000-0000
With a Copy To:
Xxxxxx & Bird LLP
Attn: Xxxxxx X. Xxxxxx
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Telecopier: (000) 000-0000
If to the Agent:
Bank of America, N.A.
000 X. XxXxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxxx
Telecopier: (000) 000-0000
With a copy to:
Bank of America, N.A.
Bank of America Plaza
000 Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telecopier: (000) 000-0000
If to the Lenders:
11
As stated on Schedule 1.1 to the Loan Agreement.
Any party may change its address for receipt of notice by written direction to
the other parties hereto.
5.10 TAXES.
(a) Payments. Any and all payments by any Guarantor to or for
the account of any Lender or the Agent hereunder or under any other
Loan Document shall be made free and clear of and without deduction for
any and all present or future taxes, duties, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect
thereto, excluding, in the case of each Lender and the Agent, taxes
imposed on or measured by its income or capital, and franchise taxes
imposed on it, by the jurisdiction under the laws of which such Lender
(or its Applicable Lending Office) or the Agent (as the case may be) is
organized or maintains a lending office or any political subdivision
thereof (all such non-excluded taxes, duties, levies, imposts,
deductions, charges, withholdings, and liabilities being hereinafter
referred to as "Taxes"). If a Guarantor shall be required by law to
deduct any Taxes from or in respect of any sum payable under this
Guaranty or any other Loan Document to any Lender or the Agent (except
as permitted under subsection (e) below), (i) the sum payable shall be
increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section 5.10) such Lender or the Agent receives an amount equal to the
sum it would have received had no such deductions been made, (ii) the
Guarantors shall make such deductions, (iii) the Guarantors shall pay
the full amount deducted to the relevant taxation authority or other
authority in accordance with applicable law, and (iv) the Guarantors
shall furnish to the Agent, at its address referred to in Section 5.9,
the original or a certified copy of a receipt evidencing payment
thereof.
(b) Other Taxes. In addition, each Guarantor agrees to pay any
and all present or future stamp or documentary taxes, property taxes
and any other excise or similar taxes or charges or levies which arise
from any payment made under this Guaranty or any other Loan Document or
from the execution or delivery of, or otherwise with respect to, this
Guaranty or any other Loan Document (hereinafter referred to as "Other
Taxes").
(c) Indemnity. Each Guarantor agrees to indemnify each Lender
and the Agent for the full amount of Taxes and Other Taxes (including,
without limitation, any Taxes or Other Taxes imposed or asserted by any
jurisdiction on amounts payable under this Section 5.10) paid by such
Lender or the Agent (as the case may be) and any liability (including
penalties, interest, and expenses) arising therefrom or with respect
thereto.
(d) Evidence of Payment. Within thirty (30) days after the
date of any payment of Taxes, the Guarantor shall furnish to the Agent
the original or a certified copy of a receipt evidencing such payment.
12
(e) Survival. Without prejudice to the survival of any other
agreement of the Borrower hereunder, the agreements and obligations of
the Borrower contained in this Section 5.10 shall survive the repayment
of the Loans and other obligations under the Loan Documents and the
termination of the Commitments hereunder.
(f) Lending Offices. If the Guarantors are required to pay
additional amounts to or for the account of any Lender pursuant to this
Section 5.10, such Lender has agreed in Section 9.13.6 of the Loan
Agreement to use reasonable efforts to change the jurisdiction of its
Applicable Lending Office so as to eliminate or reduce any such
additional payment which may thereafter accrue if such change, in the
judgment of such Lender, is not otherwise disadvantageous to such
Lender
5.11 SEVERABILITY.
If any provision of this Guaranty is determined to be illegal, invalid
or unenforceable, such provision shall be fully severable and the remaining
provisions shall remain in full force and effect and shall be construed without
giving effect to the illegal, invalid or unenforceable provisions.
5.12 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF GEORGIA. The provisions of each of the Loan Agreement relating
to submission to jurisdiction and venue are hereby incorporated by reference
herein, mutatis mutandis.
5.13 WAIVER OF JURY TRIAL.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE PARTIES TO THIS
GUARANTY HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
5.14 HEADINGS.
The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Guaranty.
5.15 COUNTERPARTS.
This Guaranty may be executed in any number of counterparts, each of
which where so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument. It shall not be necessary in
making proof of this Guaranty to produce or account for more than one such
counterpart.
13
5.16 RIGHTS OF THE REQUIRED LENDERS.
All rights of the Agent hereunder, if not exercised by the Agent, may
be exercised by the Required Lenders.
5.17 JOINT AND SEVERAL OBLIGATIONS OF GUARANTORS.
(a) Each of the Guarantors is accepting joint and several
liability hereunder in consideration of the financial accommodation to
be provided by the holders of the Guaranteed Obligations, for the
mutual benefit, directly and indirectly, of each of the Guarantors and
in consideration of the undertakings of each of the Guarantors to
accept joint and several liability for the obligations of each of them.
(b) Each of the Guarantors jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Guarantors with respect to the payment and performance of all of the
Guaranteed Obligations arising under this Guaranty, the Loan Agreement,
the other Loan Documents and any other documents relating to the
Guaranteed Obligations, it being the intention of the parties hereto
that all the Guaranteed Obligations shall be the joint and several
obligations of each of the Guarantors without preferences or
distinction among them.
(c) Notwithstanding any provision to the contrary contained
herein, in the Loan Agreement, in any other of the Loan Documents or in
any other documents relating to the Guaranteed Obligations, the
obligations of each Guarantor under the Loan Agreement and the other
Loan Documents shall be limited to an aggregate amount equal to the
largest amount that would not render such obligations subject to
avoidance under Section 548 of the Bankruptcy Code or any comparable
provisions of any applicable state law.
[remainder of page intentionally left blank]
14
IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to be duly
executed and delivered as of the day and year first above written.
GUARANTORS: RENAL CARE GROUP EAST, INC.,
a Pennsylvania corporation
RENAL CARE GROUP MICHIGAN, INC.,
a Delaware corporation
MICHIGAN HOME DIALYSIS CENTER, INC.,
a Michigan corporation
RENAL CARE GROUP OF THE MIDWEST, INC.,
a Kansas corporation
FOUR STATE REGIONAL DIALYSIS CENTER, INC.,
a Missouri corporation
FORT XXXXX REGIONAL DIALYSIS CENTER, INC.,
a Missouri corporation
MIAMI REGIONAL DIALYSIS CENTER, INC.,
a Missouri corporation
RCG MISSISSIPPI, INC.,
a Delaware corporation
RENAL CARE GROUP OF THE SOUTHEAST, INC.,
a Florida corporation
NORTHEAST ALABAMA KIDNEY CLINIC, INC.,
an Alabama corporation
RENAL CARE GROUP TEXAS, INC.,
a Texas corporation
DIALYSIS MANAGEMENT CORPORATION,
a Texas corporation
RCG PA MERGER CORP.,
a Texas corporation
STAT DIALYSIS CORPORATION,
a Delaware corporation
Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
ANGLETON DIALYSIS, INC.,
a Texas corporation
BRAZORIA KIDNEY CENTER, INC.,
a Texas corporation
XXXXXXX DIALYSIS CLINIC, INC.,
a Texas corporation
XXXXXXX DIALYSIS, INC.,
a Texas corporation
JEFFERSON COUNTY DIALYSIS, INC.,
an Arkansas corporation
KDCO, INC.,
an Arkansas corporation
XXXXXX DIALYSIS, INC.,
an Arkansas corporation
LITTLE ROCK DIALYSIS, INC.,
an Arkansas corporation
NORTHWEST DIALYSIS, INC.,
an Arkansas corporation
RENALAB, INC.,
a Delaware corporation
RCG FINANCE, INC.,
a Delaware corporation
RENALPARTNERS, INC.,
a Delaware corporation
RENALNET, INC.,
a Delaware corporation
WOUND CARE GROUP, INC.
a Delaware corporation
DIABETES CARE GROUP, INC.
a Delaware corporation
RENAL CARE GROUP ARIZONA, INC.
an Arizona corporation
2 Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
RENAL CARE GROUP NORTHWEST, INC.,
a Delaware corporation
RENALNET, ARIZONA, INC.,
an Arizona corporation
RCG UNIVERSITY DIVISION, INC.
a Tennessee corporation
RCG SUPPLY COMPANY,
a Tennessee corporation
RENAL CARE GROUP ALASKA, INC.,
an Alaska corporation
RENAL CARE GROUP SOUTHWEST HOLDINGS, INC.,
a Texas corporation
DIALYSIS CENTERS OF AMERICA - ILLINOIS, INC.,
an Illinois corporation
SSKG, INC.,
an Illinois corporation
RENAL CARE GROUP OHIO, INC.,
a Delaware corporation
PHYSICIANS DIALYSIS COMPANY, INC.,
an Ohio corporation
3 Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
DIALYSIS LICENSING CORP.,
a Delaware corporation
RCGIH, INC.
a Delaware corporation
RCG INDIANA, LLC,
a Delaware limited liability company
KIDNEY DISEASE CENTERS OF THE OZARKS, LLC
a Missouri limited liability company
4 Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
STUTTGART DIALYSIS, LLC,
an Arkansas limited liability company
RCG WEST HEALTH SUPPLY, LLC,
an Arizona limited liability company
KENTUCKY RENAL CARE GROUP, LLC,
a Delaware limited liability company
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
5 Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
RENAL CARE GROUP SOUTHWEST, L.P.
a Delaware limited partnership
By: Renal Care Group Arizona, Inc.,
an Arizona corporation
Its: General Partner
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
6 Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
ACCEPTED:
BANK OF AMERICA, N.A.,
as Agent
By: /s/ Xxxxxxxx Xxxxxxx
-----------------------------------------
Name: XXXXXXXX XXXXXXX
---------------------------------------
Title: Vice President
--------------------------------------
7 Signature Page for Amended and
Restated Guaranty Agreement
Renal Care Group
Exhibit 3.1.1 (e)
AMENDED AND RESTATED
EQUITY INTERESTS SECURITY AGREEMENT
THIS AMENDED AND RESTATED EQUITY INTERESTS SECURITY AGREEMENT (this
"Security Agreement") is entered into as of the ____ day of July, 2002, by and
among RENAL CARE GROUP, INC., a Delaware corporation (the "Borrower"), each
Person that is identified on Schedule A hereto and that hereafter becomes a
party hereto (the Borrower and each such additional party are referred to herein
collectively as "Grantors" and individually as a "Grantor") and BANK OF AMERICA,
N.A., as collateral agent ("Collateral Agent" or the "Agent") for (i) the
Multi-Year Lenders (hereinafter defined) and (ii) the 364-Day Lenders
(hereinafter defined), and amends and restates that certain Equity Interests
Security Agreement dated as of August 4, 1997 (the "Original Pledge") executed
by certain of the Grantors and Bank of America, N.A., as Agent.
W I T N E S S E T H
WHEREAS, pursuant to the terms of the 364-Day Facility, the 364-Day
Lenders have agreed to make Loans (as defined in the 364-Day Facility) upon the
terms and subject to the conditions set forth therein;
WHEREAS, pursuant to the terms of the Multi-Year Facility, the
Multi-Year Lenders have agreed to make Loans (as defined in the Multi-Year
Facility) upon the terms and subject to the conditions set forth therein; and
WHEREAS, the Lenders have required that the Grantors execute and
deliver this Security Agreement to the Collateral Agent for the ratable benefit
of the holders of the Secured Obligations.
NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein
shall have the meanings provided in the Credit Agreements (hereinafter defined).
In addition, the following terms, which are defined in the UCC as in effect in
the State of Georgia on the date hereof, are used herein as so defined:
Accession, Financial Asset, Proceeds and Security. As used herein:
"364-Day Facility" means that certain 364-Day Loan Agreement
dated as of July ___, 2002, among the Borrower, Bank of America, N.A.,
as agent, and the lenders named therein, as amended, modified,
supplemented, extended, renewed or restated from time to time.
"364-Day Lenders" means the lenders identified in the 364-Day
Facility.
"Collateral" has the meaning provided in Section 2 hereof.
"Credit Agreements" means, collectively, the 364-Day Facility
and the Multi-Year Facility.
"Credit Documents" means, collectively, the Loan Documents (as
defined in the 364-Day Facility) and the Loan Documents (as defined in
the Multi-Year Facility).
"Event of Default" has the meaning provided in Section 8
hereof.
"Lenders" means, collectively, the 364-Day Lenders and the
Multi-Year Lenders.
"Multi-Year Facility" means that certain Second Amended and
Restated Loan Agreement dated as of July ___, 2002, among the Borrower,
Bank of America, N.A., as agent, and the lenders named therein, as
amended, modified, supplemented, extended, renewed or restated from
time to time.
"Multi-Year Lenders" means the lenders identified in the
Multi-Year Facility.
"Pledged Shares" has the meaning provided in Section 2 hereof.
"Required Lenders" means the 364-Day Lenders and the
Multi-Year Lenders holding more than sixty-six and two-thirds percent
(66 2/3%) of the aggregate Secured Obligations on the date of
determination; provided, however, that the Secured Obligations owing to
any of the Lenders not then in compliance with its obligations under
the 364-Day Facility or the Multi-Year Facility shall be excluded from
the determination of Required Lenders.
"Secured Obligations" means, without duplication:
(i) all of the obligations of the Credit Parties to
the 364-Day Lenders (including the Issuing Lender (as defined
in the 364-Day Facility)), and Bank of America, N.A., as the
agent under the 364-Day Facility, whenever arising, under the
364-Day Facility or any of the other Credit Documents,
including, without limitation, the Guaranty Agreement (as
defined in the 364-Day Facility), whether now existing or
hereafter arising, due or to become due, direct or indirect,
absolute or contingent, howsoever evidenced, created, held or
acquired, whether primary, secondary, direct, contingent, or
joint and several, as such obligations may be amended,
modified, increased, extended, renewed or replaced from time
to time;
(ii) all of the obligations of the Credit Parties to
the Multi-Year Lenders (including the Issuing Lender (as
defined in the Multi-Year Facility)), and Bank of America,
N.A., as the agent under the Multi-Year Facility, whenever
arising, under the Multi-Year Facility or any of the other
Credit Documents, including, without limitation, the Guaranty
Agreement (as defined in the Multi-Year Facility), whether now
existing or hereafter arising, due or to become due, direct or
indirect,
2
absolute or contingent, howsoever evidenced, created, held or
acquired, whether primary, secondary, direct, contingent, or
joint and several, as such obligations may be amended,
modified, increased, extended, renewed or replaced from time
to time;
(iii) the present and future obligations of the
Borrower to any Lender or any Affiliate of a Lender with
respect to any Interest Rate Swap Obligations to the extent
permitted under the Credit Agreements; and
(iv) all costs and expenses incurred in connection
with enforcement and collection of the Secured Obligations,
including reasonable attorneys' fees.
"UCC" means the Uniform Commercial Code in effect in the State
of Georgia.
2. Pledge and Grant of Security Interest. To secure the prompt payment
and performance in full when due, whether by lapse of time, acceleration,
mandatory prepayment or otherwise, of the Secured Obligations, each Grantor
hereby grants, pledges and assigns to the Collateral Agent, for the benefit of
the holders of the Secured Obligations, a continuing security interest in, and a
right to set-off against, any and all right, title and interest of such Grantor
in and to the following, whether now owned or existing or owned, acquired, or
arising hereafter (collectively, the "Collateral"):
(a) Pledged Shares. (i) One hundred percent (100%) (or, if
less, the full amount owned by such Grantor) of the issued and
outstanding Capital Stock owned by such Grantor of each Domestic
Subsidiary set forth on Schedule 2(a) attached hereto and (ii)
sixty-five percent (65%) (or, if less, the full amount owned by such
Grantor) of the issued and outstanding shares of Capital Stock entitled
to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2))
("Voting Equity") and one hundred percent (100%) (or, if less, the full
amount owned by such Grantor) of the issued and outstanding Capital
Stock not entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) ("Non-Voting Equity") owned by such Grantor of each
Foreign Subsidiary set forth on Schedule 2(a) attached hereto, in each
case together with the certificates (or other agreements or
instruments), if any, representing such Capital Stock, and all options
and other rights, contractual or otherwise, with respect thereto
(collectively, together with the Capital Stock described in Section
2(b) and 2(c) below, the "Pledged Shares"), including, but not limited
to, the following:
(A) all shares, securities, membership interests or
other equity interests representing a dividend on any of the
Pledged Shares, or representing a distribution or return of
capital upon or in respect of the Pledged Shares, or resulting
from a stock split, revision, reclassification or other
exchange therefor, and any subscriptions, warrants, rights or
options issued to the holder of, or otherwise in respect of,
the Pledged Shares, provided, however, that the Grantor shall
not be required to deliver more than sixty-five percent (65%)
of the Voting Equity of any Foreign Subsidiary of such
Grantor; and
3
(B) without affecting the obligations of the Grantors
under any provision prohibiting such action hereunder or under
either of the Credit Agreements, in the event of any
consolidation or merger involving the issuer of any Pledged
Shares and in which such issuer is not the surviving entity,
all Capital Stock of the successor entity (in the applicable
percentages specified above) formed by or resulting from such
consolidation or merger.
(b) Additional Shares. (i) One hundred percent (100%) (or, if
less, the full amount owned by such Grantor) of the issued and
outstanding Capital Stock owned by such Grantor of any Person which
hereafter becomes a Domestic Subsidiary and (ii) sixty-five percent
(65%) (or, if less, the full amount owned by such Grantor) of the
Voting Equity and one hundred percent (100%) (or, if less, the full
amount owned by such Grantor) of the Non-Voting Equity owned by such
Grantor of any Person which hereafter becomes a Foreign Subsidiary,
including, without limitation, the certificates (or other agreements or
instruments) representing such Capital Stock.
(c) Accessions and Proceeds. All Accessions and all Proceeds
of any and all of the foregoing.
Without limiting the generality of the foregoing, it is hereby
specifically understood and agreed that a Grantor may from time to time
hereafter deliver additional Capital Stock to the Agent as collateral security
for the Secured Obligations. Upon delivery to the Agent, such additional Capital
Stock shall be deemed to be part of the Collateral of such Grantor and shall be
subject to the terms of this Security Agreement whether or not Schedule 2(a) is
amended to refer to such additional Capital Stock.
3. Security for Secured Obligations. The security interest created
hereby in the Collateral of each Grantor constitutes continuing collateral
security for all of the Secured Obligations.
4. Delivery of the Collateral. Each Grantor hereby agrees that:
(a) Each Grantor shall deliver to the Agent (i) simultaneously
with or prior to the execution and delivery of this Security Agreement,
all certificates representing the Pledged Shares of such Grantor and
(ii) promptly upon the receipt thereof by or on behalf of a Grantor,
all other certificates and instruments constituting Collateral of a
Grantor. Prior to delivery to the Agent, all such certificates and
instruments constituting Collateral of a Grantor shall be held in trust
by such Grantor for the benefit of the Agent pursuant hereto. All such
certificates shall be delivered in suitable form for transfer by
delivery or shall be accompanied by duly executed instruments of
transfer or assignment in blank, substantially in the form provided in
Exhibit 4(a) attached hereto.
(b) Additional Securities. If such Grantor shall receive by
virtue of its being or having been the owner of any Collateral, any (i)
certificate, including without limitation, any certificate representing
a dividend or distribution in connection with any increase or reduction
of capital, reclassification, merger, consolidation, sale of assets,
4
combination of shares or other equity interests, stock splits, spin-off
or split-off, promissory notes or other instruments; (ii) option or
right, whether as an addition to, substitution for, or an exchange for,
any Collateral or otherwise; (iii) dividends payable in securities; or
(iv) distributions of securities in connection with a partial or total
liquidation, dissolution or reduction of capital, capital surplus or
paid-in surplus, then such Grantor shall receive such certificate,
instrument, option, right or distribution in trust for the benefit of
the Agent, shall segregate it from such Grantor's other property and
shall deliver it forthwith to the Agent in the exact form received
together with any necessary endorsement and/or appropriate stock power
duly executed in blank, substantially in the form provided in Exhibit
4(a), to be held by the Agent as Collateral and as further collateral
security for the Secured Obligations.
(c) Financing Statements. Each Grantor shall execute and
deliver to the Agent such UCC or other applicable financing statements
as may be reasonably requested by the Agent in order to perfect and
protect the security interest created hereby in the Collateral of such
Grantor.
5. Representations and Warranties. Each Grantor hereby represents and
warrants to the Agent, for the benefit of the holders of the Secured
Obligations, that so long as any of the Secured Obligations remains outstanding
and until all of the commitments relating thereto have been terminated:
(a) Authorization of Pledged Shares. The Pledged Shares are
duly authorized and validly issued, are fully paid and nonassessable
and are not subject to the preemptive rights of any Person.
(b) Title. Each Grantor has good and indefeasible title to the
Collateral of such Grantor and will at all times be the legal and
beneficial owner of such Collateral free and clear of any Encumbrance,
other than Permitted Encumbrances. There exists no "adverse claim"
within the meaning of Section 8-102 of the UCC with respect to the
Pledged Shares of such Grantor.
(c) Exercising of Rights. The exercise by the Agent of its
rights and remedies hereunder will not violate any law or governmental
regulation or any material contractual restriction binding on or
affecting a Grantor or any of its property.
(d) Grantor's Authority. No authorization, approval or action
by, and no notice or filing with any Governmental Authority or with the
issuer of any Pledged Stock is required either (i) for the pledge made
by a Grantor or for the granting of the security interest by a Grantor
pursuant to this Security Agreement (except as have been already
obtained) or (ii) for the exercise by the Agent or the holders of the
Secured Obligations of their rights and remedies hereunder (except as
may be required by laws affecting the offering and sale of securities).
(e) Security Interest/Priority. This Security Agreement
creates a valid security interest in favor of the Agent for the benefit
of the holders of the Secured
5
Obligations, in the Collateral. The taking of possession by the Agent
of the certificates representing the Pledged Shares and all other
certificates and instruments constituting Collateral will perfect and
establish the first priority of the Agent's security interest in the
Pledged Shares and, when properly perfected by filing or registration,
in all other Collateral represented by such Pledged Shares and
instruments securing the Secured Obligations. Except as set forth in
this Section 5(e), no action is necessary to perfect or otherwise
protect such security interest.
(f) Partnership and Membership Interests. Except as previously
disclosed to the Agent, none of the Pledged Shares consisting of
partnership or limited liability company interests (i) is dealt in or
traded on a securities exchange or in a securities market, (ii) by its
terms expressly provides that it is a security governed by Article 8 of
the UCC, (iii) is an investment company security, (iv) is held in a
securities account or (v) constitutes a Security or a Financial Asset.
(g) No Other Interests. No Grantor owns any Capital Stock in
any Subsidiary other than as set forth on Schedule 2(a) attached
hereto.
6. Covenants. Each Grantor hereby covenants, that so long as any of the
Secured Obligations remains outstanding and until all of the commitments
relating thereto have been terminated, such Grantor shall:
(a) Books and Records. Xxxx its books and records (and shall
cause the issuer of the Pledged Shares of such Grantor to xxxx its
books and records) to reflect the security interest granted to the
Agent, for the benefit of the holders of the Secured Obligations,
pursuant to this Security Agreement.
(b) Defense of Title. Warrant and defend title to and
ownership of the Collateral of such Grantor at its own expense against
the claims and demands of all other parties claiming an interest
therein, keep the Collateral free from all Encumbrances, except for
Permitted Encumbrances, and not sell, exchange, transfer, assign, lease
or otherwise dispose of Collateral of such Grantor or any interest
therein, except as permitted under the Credit Agreements and the other
Credit Documents.
(c) Further Assurances. Promptly execute and deliver at its
expense all further instruments and documents and take all further
action that may be necessary and desirable or that the Agent may
reasonably request in order to (i) perfect and protect the security
interest created hereby in the Collateral of such Grantor (including,
without limitation, any and all action necessary to satisfy the Agent
that the Agent has obtained a first priority perfected security
interest in all Collateral); (ii) enable the Agent to exercise and
enforce its rights and remedies hereunder in respect of the Collateral
of such Grantor; and (iii) otherwise effect the purposes of this
Security Agreement, including, without limitation and if requested by
the Agent, delivering to the Agent irrevocable proxies in respect of
the Collateral of such Grantor.
6
(d) Amendments. Not make or consent to any amendment or other
modification or waiver with respect to any of the Collateral of such
Grantor or enter into any agreement or allow to exist any restriction
with respect to any of the Collateral of such Grantor other than
pursuant hereto or as may be permitted under the Credit Agreements.
(e) Compliance with Securities Laws. File all reports and
other information now or hereafter required to be filed by such Grantor
with the United States Securities and Exchange Commission and any other
state, federal or foreign agency in connection with the ownership of
the Collateral of such Grantor.
(f) Issuance or Acquisition of Capital Stock. Not, without
providing 30 days prior written notice to the Agent and without
executing and delivering, or causing to be executed and delivered, to
the Agent such agreements, documents and instruments as the Agent may
require, issue or acquire any Capital Stock consisting of an interest
in a partnership or a limited liability company that (i) is dealt in or
traded on a securities exchange or in a securities market, (ii) by its
terms expressly provides that it is a security governed by Article 8 of
the UCC, (iii) is an investment company security, (iv) is held in a
securities account or (v) constitutes a Security or a Financial Asset.
7. Advances by Holders of the Secured Obligations. On failure of any
Grantor to perform any of the covenants and agreements contained herein, the
Agent may, at its sole option and in its sole discretion, perform the same and
in so doing may expend such sums as the Agent may reasonably deem advisable in
the performance thereof, including, without limitation, the payment of any
insurance premiums, the payment of any taxes, a payment to obtain a release of a
Encumbrance or potential Encumbrance, expenditures made in defending against any
adverse claim and all other expenditures which the Agent or the holders of the
Secured Obligations may make for the protection of the security hereof or which
may be compelled to make by operation of law. All such sums and amounts so
expended shall be repayable by the Grantors on a joint and several basis
promptly upon timely notice thereof and demand therefor, shall constitute
additional Secured Obligations and shall bear interest from the date said
amounts are expended at the Default Rate. No such performance of any covenant or
agreement by the Agent or the holders of the Secured Obligations on behalf of
any Grantor, and no such advance or expenditure therefor, shall relieve the
Grantors of any default under the terms of this Security Agreement, the Credit
Agreements, the other Credit Documents or any other documents relating to the
Secured Obligations. The holders of the Secured Obligations may make any payment
hereby authorized in accordance with any xxxx, statement or estimate procured
from the appropriate public office or holder of the claim to be discharged
without inquiry into the accuracy of such xxxx, statement or estimate or into
the validity of any tax assessment, sale, forfeiture, tax lien, title or claim
except to the extent such payment is being contested in good faith by a Grantor
in appropriate proceedings and against which adequate reserves are being
maintained in accordance with GAAP.
8. Events of Default. The occurrence of an event which would constitute
an Event of Default under and as defined in the 364-Day Facility or the
Multi-Year Facility shall be an Event of Default hereunder (an "Event of
Default").
7
9. Remedies.
(a) General Remedies. Upon the occurrence of an Event of
Default and during the continuation thereof, the Agent and the holders
of the Secured Obligations shall have, in addition to the rights and
remedies provided herein, in the in the Credit Agreements, in the other
Credit Documents, in any other documents relating to the Secured
Obligations, or by law (including, without limitation, levy of
attachment and garnishment), the rights and remedies of a secured party
under the UCC of the jurisdiction applicable to the affected
Collateral.
(b) Sale of Collateral. Upon the occurrence of an Event of
Default and during the continuation thereof, without limiting the
generality of this Section 9 and without notice, the Agent may, in its
sole discretion, sell or otherwise dispose of or realize upon the
Collateral, or any part thereof, in one or more parcels, at public or
private sale, at any exchange or broker's board or elsewhere, at such
price or prices and on such other terms as the Agent may deem
commercially reasonable, for cash, credit or for future delivery or
otherwise in accordance with applicable law. To the extent permitted by
law, any holder of the Secured Obligations may in such event, bid for
the purchase of such securities. Each Grantor agrees that, to the
extent notice of sale shall be required by law and has not been waived
by such Grantor, any requirement of reasonable notice shall be met if
notice, specifying the place of any public sale or the time after which
any private sale is to be made, is personally served on or mailed,
postage prepaid, to such Grantor, in accordance with the notice
provisions of Section 10.1 of each of the Credit Agreements at least
ten days before the time of such sale. The Agent shall not be obligated
to make any sale of Collateral of such Grantor regardless of notice of
sale having been given. The Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the
time and place to which it was so adjourned.
(c) Private Sale. Upon the occurrence of an Event of Default
and during the continuation thereof, the Grantors recognize that the
Agent may deem it impracticable to effect a public sale of all or any
part of the Pledged Shares or any of the securities constituting
Collateral and that the Agent may, therefore, determine to make one or
more private sales of any such Collateral to a restricted group of
purchasers who will be obligated to agree, among other things, to
acquire such Collateral for their own account, for investment and not
with a view to the distribution or resale thereof. Each Grantor
acknowledges that any such private sale may be at prices and on terms
less favorable to the seller than the prices and other terms which
might have been obtained at a public sale and, notwithstanding the
foregoing, agrees that such private sale shall be deemed to have been
made in a commercially reasonable manner and that the Agent shall have
no obligation to delay sale of any such Collateral for the period of
time necessary to permit the issuer of such Collateral to register such
Collateral for public sale under the Securities Act. Each Grantor
further acknowledges and agrees that any offer to sell such Collateral
which has been (i) publicly advertised on a bona fide basis in a
newspaper or other publication of general circulation in the financial
community of New York, New York (to the extent that such offer may be
advertised without prior registration under the Securities
8
Act), or (ii) made privately in the manner described above shall be
deemed to involve a "public sale" under the UCC, notwithstanding that
such sale may not constitute a "public offering" under the Securities
Act, and the Agent may, in such event, bid for the purchase of such
Collateral.
(d) Retention of Collateral. To the extent permitted under
applicable law, in addition to the rights and remedies hereunder, upon
the occurrence of an Event of Default, the Agent may, after providing
the notices required by Sections 9-620 and 9-621 of the UCC or
otherwise complying with the requirements of applicable law of the
relevant jurisdiction, accept or retain all or any portion of the
Collateral in satisfaction of the Secured Obligations. Unless and until
the Agent shall have provided such notices, however, the Agent shall
not be deemed to have accepted or retained any Collateral in
satisfaction of any Secured Obligations for any reason.
(e) Deficiency. In the event that the proceeds of any sale,
collection or realization are insufficient to pay all amounts to which
the Agent or the holders of the Secured Obligations are legally
entitled, the Grantors shall be jointly and severally liable for the
deficiency, together with interest thereon at the Default Rate,
together with the costs of collection and reasonable attorneys' fees
and expenses. Any surplus remaining after the full payment and
satisfaction of the Secured Obligations shall be returned to the
Grantors or to whomsoever a court of competent jurisdiction shall
determine to be entitled thereto.
(f) Authorization to File Financing Statements. Each Grantor
authorized the Agent to prepare and file such financing statements
(including renewal statements), amendments and supplements or such
other instruments as the Agent may from time to time reasonably deem
necessary in order to perfect and maintain the security interests
granted hereunder in accordance with the UCC.
10. Rights of the Agent.
(a) Power of Attorney. In addition to other powers of attorney
contained herein, each Grantor hereby designates and appoints the
Agent, on behalf of the holders of the Secured Obligations, and each of
its designees or agents, as attorney-in-fact of such Grantor,
irrevocably and with power of substitution, with authority to take any
or all of the following actions upon the occurrence and during the
continuation of an Event of Default:
(i) to demand, collect, settle, compromise and
adjust, and give discharges and releases concerning the
Collateral, all as the Agent may reasonably deem appropriate;
(ii) to commence and prosecute any actions at any
court for the purposes of collecting any of the Collateral and
enforcing any other right in respect thereof;
9
(iii) to defend, settle or compromise any action
brought and, in connection therewith, give such discharge or
release as the Agent may reasonably deem appropriate;
(iv) to pay or discharge taxes, liens, security
interests or other encumbrances levied or placed on or
threatened against the Collateral;
(v) to direct any parties liable for any payment in
connection with any of the Collateral to make payment of any
and all monies due and to become due thereunder directly to
the Agent or as the Agent shall direct;
(vi) to receive payment of and receipt for any and
all monies, claims, and other amounts due and to become due at
any time in respect of or arising out of any Collateral;
(vii) to sign and endorse any drafts, assignments,
proxies, stock powers, verifications, notices and other
documents relating to the Collateral;
(viii) to execute and deliver all assignments,
conveyances, statements, financing statements, renewal
financing statements, security and pledge agreements,
affidavits, notices and other agreements, instruments and
documents that the Agent may reasonably deem appropriate in
order to perfect and maintain the security interests and liens
granted in this Security Agreement and in order to fully
consummate all of the transactions contemplated therein;
(ix) to exchange any of the Collateral or other
property upon any merger, consolidation, reorganization,
recapitalization or other readjustment of the issuer thereof
and, in connection therewith, deposit any of the Collateral
with any committee, depository, transfer agent, registrar or
other designated agency upon such terms as the Agent may
reasonably deem appropriate;
(x) to vote for a shareholder resolution, or to sign
an instrument in writing, sanctioning the transfer of any or
all of the Collateral into the name of the Agent or one or
more of the holders of the Secured Obligations or into the
name of any transferee to whom the Collateral or any part
thereof may be sold pursuant to Section 9 hereof; and
(xi) to do and perform all such other acts and things
as the Agent may reasonably deem appropriate or convenient in
connection with the Collateral.
This power of attorney is a power coupled with an interest and
shall be irrevocable for so long as any of the Secured Obligations
shall remain outstanding and until all of the commitments relating
thereto shall have been terminated. The Agent shall be under no duty to
exercise or withhold the exercise of any of the rights, powers,
privileges and options expressly or implicitly granted to the Agent in
this Security Agreement, and shall not be liable for any failure to do
so or any delay in doing so. The
10
Agent shall not be liable for any act or omission or for any error of
judgment or any mistake of fact or law in its individual capacity or
its capacity as attorney-in-fact except acts or omissions resulting
from its gross negligence or willful misconduct. This power of attorney
is conferred on the Agent solely to protect, preserve and realize upon
its security interest in the Collateral.
(b) Performance by the Agent of Obligations. If any Grantor
fails to perform any agreement or obligation contained herein, the
Agent itself may perform, or cause performance of, such agreement or
obligation, and the expenses of the Agent incurred in connection
therewith shall be payable by the Grantors on a joint and several basis
pursuant to Section 26 hereof.
(c) Assignment by the Agent. The Agent may from time to time
assign the Secured Obligations and any portion thereof and/or the
Collateral and any portion thereof, and the assignee shall be entitled
to all of the rights and remedies of the Agent under this Security
Agreement in relation thereto.
(d) The Agent's Duty of Care. Other than the exercise of
reasonable care to assure the safe custody of the Collateral while
being held by the Agent hereunder, the Agent shall have no duty or
liability to preserve rights pertaining thereto, it being understood
and agreed that the Grantors shall be responsible for preservation of
all rights in the Collateral, and the Agent shall be relieved of all
responsibility for the Collateral upon surrendering it or tendering the
surrender of it to the Grantors. The Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the
Collateral in its possession if such Collateral is accorded treatment
substantially equal to that which the Agent accords its own property,
which shall be no less than the treatment employed by a reasonable and
prudent agent in the industry, it being understood that the Agent shall
not have responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other
matters relating to any Collateral, whether or not the Agent has or is
deemed to have knowledge of such matters, or (ii) taking any necessary
steps to preserve rights against any parties with respect to any of the
Collateral.
(e) Voting Rights in Respect of the Collateral.
(i) So long as no Event of Default shall have
occurred and be continuing, to the extent permitted by law,
each Grantor may exercise any and all voting and other
consensual rights pertaining to the Collateral of such Grantor
or any part thereof for any purpose not inconsistent with the
terms of this Security Agreement or either of the Credit
Agreements; and
(ii) Upon the occurrence and during the continuance
of an Event of Default, all rights of a Grantor to exercise
the voting and other consensual rights which it would
otherwise be entitled to exercise pursuant to paragraph (i) of
this subsection shall cease and all such rights shall
thereupon become vested in the
11
Agent which shall then have the sole right to exercise such
voting and other consensual rights.
(f) Dividend Rights in Respect of the Collateral.
(i) So long as no Event of Default shall have
occurred and be continuing and subject to Section 4(b) hereof,
each Grantor may receive and retain any and all dividends
(other than stock dividends and other dividends constituting
Collateral addressed hereinabove) or interest paid in respect
of the Collateral to the extent they are allowed under each of
the Credit Agreements.
(ii) Upon the occurrence and during the continuance
of an Event of Default:
(A) all rights of a Grantor to receive the
dividends and interest payments which it would
otherwise be authorized to receive and retain
pursuant to paragraph (i) of this subsection shall
cease and all such rights shall thereupon be vested
in the Agent, which shall then have the sole right to
receive and hold as Collateral such dividends and
interest payments; and
(B) all dividends and interest payments
which are received by a Grantor contrary to the
provisions of paragraph (A) of this subsection shall
be received in trust for the benefit of the Agent,
shall be segregated from other property or funds of
such Grantor, and shall be forthwith paid over to the
Agent as Collateral in the exact form received, to be
held by the Agent as Collateral and as further
collateral security for the Secured Obligations.
(g) Release of Collateral. The Agent may release any of the
Collateral from this Security Agreement or may substitute any of the
Collateral for other Collateral without altering, varying or
diminishing in any way the force, effect, lien, pledge or security
interest of this Security Agreement as to any Collateral not expressly
released or substituted, and this Security Agreement shall continue as
a first priority lien on all Collateral not expressly released or
substituted.
11. Rights of the Required Lenders. All rights of the Agent hereunder,
if not exercised by the Agent, may be exercised by the Required Lenders.
12. Application of Proceeds. Upon the occurrence and during the
continuation of an Event of Default, any payments in respect of the Secured
Obligations and any proceeds of the Collateral, when received by the Agent or
any of the holders of the Secured Obligations in cash or its equivalent, will be
applied in reduction of the Secured Obligations in the order set forth below:
12
(i) First, to the payment of the costs and expenses of the
Agent (including without limitation reasonable attorneys' fees)
incurred in connection with the execution of its duties as the Agent,
in exercising or attempting to exercise any right or remedy hereunder
or in taking possession of, protecting, preserving or disposing of any
item of Collateral, and all protective advances made by the Agent with
respect to the Collateral under or pursuant to the terms hereof;
(ii) Second, to the payment of any fees owed to the agent
under either of the Credit Agreements;
(iii) Third, to the payment of all out-of-pocket expenses
(including without limitation reasonable attorneys' fees) of each of
the Secured Parties in connection with enforcing its rights under the
Credit Documents or otherwise with respect to the Secured Obligations
owing to such Secured Party;
(iv) Fourth, to the Lenders, ratably, in accordance with the
respective amounts of the Secured Obligations constituting the then
aggregate unpaid principal amount of the Loans, together with all
accrued and unpaid interest thereon at such time; and
(v) Last, after payment in full of the Secured Obligations, to
the payment of the surplus, if any, to whoever may be lawfully entitled
to receive such surplus.
Each Grantor irrevocably waives the right to direct the application of such
payments and proceeds and acknowledges and agrees that the Agent shall have the
continuing and exclusive right to apply and reapply any and all such payments
and proceeds in the Agent's sole discretion, notwithstanding any entry to the
contrary upon any of its books and records. Payments by the Agent in respect of
(i) Secured Obligations related to the 364-Day Facility shall be made to the
agent under the 364-Day Facility for distribution to the 364-Day Lenders in
accordance with the 364-Day Facility, (ii) Secured Obligations related to the
Multi-Year Facility shall be made to the agent under the Multi-Year Facility for
distribution to the Multi-Year Lenders in accordance with the Multi-Year
Facility and (iii) Secured Obligations related to Hedging Agreements shall be
made to the party entitled thereto.
13. Costs of Counsel. At all times hereafter, whether or not upon the
occurrence of an Event of Default, the Grantors agree to promptly pay upon
demand any and all reasonable costs and expenses (including, without limitation,
reasonable attorneys' fees and expenses) of the Agent and the holders of the
Secured Obligations (a) as required by the Credit Agreements and (b) as
necessary to protect the Collateral or to exercise any rights or remedies under
this Security Agreement or with respect to any of the Collateral. All of the
foregoing costs and expenses shall constitute Secured Obligations hereunder.
13
14. Continuing Agreement.
(a) This Security Agreement shall be a continuing agreement in
every respect and shall remain in full force and effect so long as any
of the Secured Obligations remains outstanding and until all of the
commitments relating thereto have been terminated (other than any such
obligations which by the terms thereof are stated to survive
termination of the Credit Agreements and the other Credit Documents).
Upon such payment and termination, this Security Agreement shall be
automatically terminated and the Agent and the holders of the Secured
Obligations shall, upon the request and at the expense of the Grantors,
forthwith release all of its liens and security interests hereunder and
shall execute and deliver all UCC termination statements and/or other
documents reasonably requested by the Grantors evidencing such
termination. Notwithstanding the foregoing, all releases and
indemnities provided hereunder shall survive termination of this
Security Agreement.
(b) This Security Agreement shall continue to be effective or
be automatically reinstated, as the case may be, if at any time
payment, in whole or in part, of any of the Secured Obligations is
rescinded or must otherwise be restored or returned by the Agent or any
holder of the Secured Obligations as a preference, fraudulent
conveyance or otherwise under any bankruptcy, insolvency or similar
law, all as though such payment had not been made; provided that in the
event payment of all or any part of the Secured Obligations is
rescinded or must be restored or returned, all reasonable costs and
expenses (including, without limitation, attorneys' fees and
disbursements) incurred by the Agent or any holder of the Secured
Obligations in defending and enforcing such reinstatement shall be
deemed to be included as a part of the Secured Obligations.
15. Amendments and Waivers. This Security Agreement and the provisions
hereof may not be amended, waived, modified, changed, discharged or terminated
except as set forth in Section 10.15 of each of the Credit Agreements.
16. Successors in Interest. This Security Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Grantor, its successors and assigns, and shall inure, together with the rights
and remedies of the Agent and the holders of the Secured Obligations hereunder,
to the benefit of the Agent and the holders of the Secured Obligations and their
successors and permitted assigns; provided, however, that none of the Grantors
may assign its rights or delegate its duties hereunder without the prior written
consent of the requisite Lenders under the Credit Agreements. To the fullest
extent permitted by law, each Grantor hereby releases the Agent and each holder
of the Secured Obligations, and their respective successors and assigns, from
any liability for any act or omission relating to this Security Agreement or the
Collateral, except for any liability arising from the gross negligence or
willful misconduct of the Agent or such holder, or their respective officers,
employees or agents.
17. Notices. All notices required or permitted to be given under this
Security Agreement shall be given as provided in Section 10.1 of each of the
Credit Agreements.
18. Counterparts. This Security Agreement may be executed in any number
of counterparts, each of which where so executed and delivered shall be an
original, but all of
14
which shall constitute one and the same instrument. It shall not be necessary in
making proof of this Security Agreement to produce or account for more than one
such counterpart.
19. Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Security Agreement.
20. Governing Law; Submission to Jurisdiction; Venue. THIS SECURITY
AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE
GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF GEORGIA. The provisions of each of the Credit Agreements relating to
submission to jurisdiction and venue are hereby incorporated by reference
herein, mutatis mutandis.
21. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
EACH OF THE PARTIES TO THIS SECURITY AGREEMENT HEREBY IRREVOCABLY WAIVES ALL
RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF
OR RELATING TO THIS SECURITY AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
22. Severability. If any provision of this Security Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.
23. Entirety. This Security Agreement, the Credit Agreements, the other
Credit Documents and the other documents relating to the Secured Obligations
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Agreements, the
other Credit Documents, any other documents relating to the Secured Obligations,
or the transactions contemplated herein and therein.
24. Survival. All representations and warranties of the Grantors
hereunder shall survive the execution and delivery of this Security Agreement,
the Credit Agreements, the other Credit Documents and the other documents
relating to the Secured Obligations, the delivery of the Notes and the extension
of credit thereunder or in connection therewith.
25. Other Security. To the extent that any of the Secured Obligations
are now or hereafter secured by property other than the Collateral (including,
without limitation, real and other personal property owned by a Grantor), or by
a guarantee, endorsement or property of any other Person, then the Agent shall
have the right to proceed against such other property, guarantee or endorsement
upon the occurrence of any Event of Default, and the Agent shall have the right,
in its sole discretion, to determine which rights, security, liens, security
interests or remedies the Agent shall at any time pursue, relinquish,
subordinate, modify or take with respect thereto, without in any way modifying
or affecting any of them or the Secured Obligations or any of the rights of the
Agent or the holders of the Secured Obligations under this Security
15
Agreement, either of the Credit Agreements, under any of the other Credit
Documents or under any other document relating to the Secured Obligations.
26. Joint and Several Obligations of Grantors.
(a) Each of the Grantors is accepting joint and several
liability hereunder in consideration of the financial accommodation to
be provided by the holders of the Secured Obligations, for the mutual
benefit, directly and indirectly, of each of the Grantors and in
consideration of the undertakings of each of the Grantors to accept
joint and several liability for the obligations of each of them.
(b) Each of the Grantors jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Grantors with respect to the payment and performance of all of the
Secured Obligations arising under this Security Agreement, the Credit
Agreements, the other Credit Documents and any other documents relating
to the Secured Obligations, it being the intention of the parties
hereto that all the Secured Obligations shall be the joint and several
obligations of each of the Grantors without preferences or distinction
among them.
(c) Notwithstanding any provision to the contrary contained
herein, in either of the Credit Agreements, in any other of the Credit
Documents or in any other documents relating to the Secured
Obligations, the obligations of each Guarantor under either of the
Credit Agreements and the other Credit Documents shall be limited to an
aggregate amount equal to the largest amount that would not render such
obligations subject to avoidance under Section 548 of the Bankruptcy
Code or any comparable provisions of any applicable state law.
27. Amendment and Restatement. Notwithstanding the amendment and
restatement of the Original Pledge on the date hereof, this Security Agreement
continues, and does not terminate or nullify any of the liens or security
interests heretofore created or granted by the Grantors in favor of the Agent or
in favor of Bank of America, N.A., in its capacity as the agent under the 1997
Loan Agreement, and all such existing liens and security interests shall remain
in full force and effect, without interruption in the attachment or perfection
of any such liens and security interests.
16
28. Authorization of Financing Statements. The Grantors authorize the
Agent to file financing statements (including renewal statements and in lieu
statements) and amendments thereof and supplements thereto with respect to the
Collateral in such form and in such filing offices as the Agent reasonably
determines appropriate to perfect the security interests of the Agent under this
Security Agreement. Any financing statement filed by the Agent may contain a
general description of the collateral covered thereby, as permitted by the UCC,
which states that the security interest attaches to all personal property of the
debtor.
[remainder of page intentionally left blank]
17
Each of the parties hereto has caused a counterpart of this Security
Agreement to be duly executed and delivered as of the date first above written.
GRANTORS: RENAL CARE GROUP, INC.,
a Delaware corporation
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
RENAL CARE GROUP MICHIGAN, INC.,
a Delaware corporation
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
RENAL CARE GROUP OHIO, INC.,
a Delaware corporation
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
COLLATERAL AGENT: BANK OF AMERICA, N.A.,
as Collateral Agent
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Schedule A
to
Security Agreement
dated as of July ___, 2002
in favor of Bank of America, N.A.
as Collateral Agent
OTHER GRANTORS
Schedule 2(a)
to
Security Agreement
dated as of July ___, 2002
in favor of Bank of America, N.A.
as Collateral Agent
PLEDGED STOCK
Number of Certificate Percentage Percentage
Grantor Issuer Shares Number Owned Pledged
------- ------ ------ ------ -------
Exhibit 4(a)
to
Security Agreement
dated as of July ___, 2002
in favor of Bank of America, N.A.
as Collateral Agent
Irrevocable Stock Power
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
to
the following shares of capital stock of ____________________, a ____________
corporation:
No. of Shares Certificate No.
and irrevocably appoints __________________________________ its agent and
attorney-in-fact to transfer all or any part of such capital stock and to take
all necessary and appropriate action to effect any such transfer. The agent and
attorney-in-fact may substitute and appoint one or more persons to act for him.
The effectiveness of a transfer pursuant to this stock power shall be subject to
any and all transfer restrictions referenced on the face of the certificates
evidencing such interest or in the certificate of incorporation or bylaws of the
subject corporation, to the extent they may from time to time exist.
[HOLDER]
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Exhibit 3.1.1 (f)
AMENDED AND RESTATED
COLLATERAL ASSIGNMENT OF PROMISSORY NOTES
This Amended and Restated Collateral Assignment of Promissory Notes
(the "Assignment") is entered into as of the _____ day of July, 2002, by and
among RENAL CARE GROUP, INC., a Delaware corporation (the "Borrower"), and each
Person that is identified on collective Schedule A hereto and that hereafter
becomes a party hereto (the Borrower and each such additional party are referred
to herein collectively as "Grantors" and individually as a "Grantor") and BANK
OF AMERICA, N.A., as collateral agent (the "Collateral Agent" or the "Agent")
for (i) the Multi-Year Lenders (hereinafter defined) and (ii) the 364-Day
Lenders (hereinafter defined), and amends and restates that certain Collateral
Assignment of Promissory Notes dated as of August ___, 1997 (the "Original
Assignment") executed by certain of the Grantors and Bank of America, N.A., as
agent.
WITNESSETH
WHEREAS, pursuant to the terms of the 364-Day Facility, the 364-Day
Lenders have agreed to make Loans (as defined in the 364-Day Facility) upon the
terms and subject to the conditions set forth therein;
WHEREAS, pursuant to the terms of the Multi-Year Facility, the
Multi-Year Lenders have agreed to make Loans (as defined in the Multi-Year
Facility) upon the terms and subject to the conditions set forth therein; and
WHEREAS, the Lenders have required that the Grantors execute and
deliver this Assignment to the Collateral Agent for the ratable benefit of the
holders of the Secured Obligations.
NOW, THEREFORE, as an inducement to cause the Lenders to extend credit
to Grantor, and for other valuable consideration, the receipt and sufficiency of
which are acknowledged, it is agreed as follows:
1. Definitions. Capitalized terms used and not otherwise defined herein
shall have the meanings provided in the Credit Agreements (as defined below). As
used herein:
"364-Day Facility" means that certain 364-Day Loan Agreement
dated as of July ___, 2002, among the Borrower, Bank of America, N.A.,
as agent, and the lenders named therein, as amended, modified,
supplemented, extended, renewed or restated from time to time.
"364-Day Lenders" means the lenders identified in the 364-Day
Facility.
"Credit Agreements" means, collectively, the 364-Day Facility
and the Multi-Year Facility.
"Credit Documents" means, collectively, the Loan Documents (as
defined in the 364-Day Facility) and the Loan Documents (as defined in
the Multi-Year Facility).
"Event of Default" has the meaning provided in Section 11
hereof.
"Lenders" means, collectively, the 364-Day Lenders and the
Multi-Year Lenders.
"Multi-Year Facility" means that certain Second Amended and
Restated Loan Agreement dated as of July ___, 2002, among the Borrower,
Bank of America, N.A., as agent, and the lenders named therein, as
amended, modified, supplemented, extended, renewed or restated from
time to time.
"Multi-Year Lenders" means the lenders identified in the
Multi-Year Facility.
"Required Lenders" means the 364-Day Lenders and the
Multi-Year Lenders holding more than sixty-six and two-thirds percent
(66 2/3%) of the aggregate Secured Obligations on the date of
determination; provided, however, that the Secured Obligations owing to
any of the Lenders not then in compliance with its obligations under
the 364-Day Facility or the Multi-Year Facility shall be excluded from
the determination of Required Lenders.
"Secured Obligations" means, without duplication:
(i) all of the obligations of the Credit Parties to
the 364-Day Lenders (including the Issuing Lender (as defined
in the 364-Day Facility)), and Bank of America, N.A., as the
agent under the 364-Day Facility, whenever arising, under the
364-Day Facility or any of the other Credit Documents,
including, without limitation, the Guaranty Agreement (as
defined in the 364-Day Facility), whether now existing or
hereafter arising, due or to become due, direct or indirect,
absolute or contingent, howsoever evidenced, created, held or
acquired, whether primary, secondary, direct, contingent, or
joint and several, as such obligations may be amended,
modified, increased, extended, renewed or replaced from time
to time;
(ii) all of the obligations of the Credit Parties to
the Multi-Year Lenders (including the Issuing Lender (as
defined in the Multi-Year Facility)), and Bank of America,
N.A., as the agent under the Multi-Year Facility, whenever
arising, under the Multi-Year Facility or any of the other
Credit Documents, including, without limitation, the Guaranty
Agreement (as defined in the Multi-Year Facility), whether now
existing or hereafter arising, due or to become due, direct or
indirect, absolute or contingent, howsoever evidenced,
created, held or acquired, whether primary, secondary, direct,
contingent, or joint and several, as such obligations
may be amended, modified, increased, extended, renewed or
replaced from time to time;
(iii) the present and future obligations of the
Borrower to any Lender or any Affiliate of a Lender with
respect to any Interest Rate Swap Obligations to the extent
permitted under the Credit Agreements; and
(iv) all costs and expenses incurred in connection
with enforcement and collection of the Secured Obligations,
including reasonable attorneys' fees.
"UCC" means the Uniform Commercial Code in effect in the State
of Georgia.
2. Security Interest; Assignment. To secure the payment of the Secured
Obligations, each Grantor hereby assigns to the Agent, for the benefit of the
Lenders, and grants to the Agent, for the benefit of the Lenders, a security
interest in those promissory notes payable to the order of such Grantor and
described in Exhibit A attached hereto (the "Collateral Notes"), together with
all proceeds thereof.
3. Negotiation of Collateral Notes; Perfection. Each Grantor shall
negotiate the Collateral Notes to the Agent for the benefit of the Lenders by
endorsing its Collateral Notes to the order of Agent (without restriction or
qualification) and delivering the Collateral Notes to the Agent. The Agent shall
retain possession of the Collateral Notes to perfect its security interest
therein.
4. Representations and Warranties. Each Grantor represents and warrants
to the Agent, for the benefit of the holders of the Secured Obligations, that so
long as any of the Secured Obligations remains outstanding and until all of the
commitments relating thereto have been terminated:
(a) Sole Instrument. Each Collateral Note is the only
instrument evidencing the indebtedness described therein.
(b) Ownership of Collateral Notes. Grantor is the lawful
holder and owner of the Collateral Notes.
(c) No Obligation to Remit Payments. Grantor has not agreed,
and no holder of any Collateral Note shall be obligated, to remit any
payments made under the Collateral Notes for the account of any other
person or business entity, except that the Agent shall apply all funds
received by it as holder thereof for the account of Grantor.
(d) Binding Agreement. Each Collateral Note is the legal valid
and binding obligation of, and is enforceable against the maker thereof
(the "Obligor") according to its terms.
(e) No Other Assignment. No Collateral Note is subject to any
assignment, lien or other encumbrance, except for the security interest
provided for herein.
(f) Payments Current. All payments required under the
Collateral Notes are presently current.
(g) No Default. No default presently exists under any
Collateral Note and no condition presently exists which, with the
giving of notice, the passage of time, or both, will cause such a
default.
(h) No Setoff. None of the debts evidenced by the Collateral
Notes are subject to any defense or setoff except as may be provided by
applicable law.
(i) Valid Assignment. This Assignment and the delivery of the
Collateral Notes to the Agent for the benefit of the Lenders grants the
Agent, for the benefit of the Lenders, a valid first priority security
interest in the Collateral Notes.
(j) No Amendment or Waiver. Except as disclosed to the Agent
in writing, no provision of the Collateral Notes have been amended or
waived.
(k) Addresses of Obligors. The correct current addresses of
Obligors under the Collateral Notes are correctly listed on Exhibit A
hereto.
Without limiting the generality of the foregoing, it is hereby
specifically understood and agreed that a Grantor may from time to time
hereafter pledge and deliver additional promissory notes to the Agent
as collateral security for the Secured Obligations. Upon such pledge
and delivery to the Agent, such additional promissory notes shall be
deemed to be part of the Collateral Notes of such Grantor, and shall be
subject to the terms of this Assignment whether or not Exhibit A hereto
is amended to refer to such additional promissory notes.
5. Covenants. Each Grantor covenants with the Agent, for the benefit of
the holders of the Secured Obligations, that so long as any of the Secured
Obligations remains outstanding and until all of the commitments relating
thereto have been terminated as follows:
(a) Notice of Default and Consent to Action. Grantor shall
immediately notify the Agent if a default occurs under any Collateral
Note, and shall obtain the written consent of the Agent prior to the
exercise of any of Grantor's remedies upon such default.
(b) Notices. Grantor shall promptly convey to the Agent any
notice received by Grantor concerning any Collateral Note.
(c) No Further Encumbrances. Grantor shall not sell, assign,
or grant or allow any lien to attach to any of the Collateral Notes,
except for the security interest provided for herein.
6. Recitals. Each Grantor represents, warrants and agrees that the
recitals set forth at the beginning of this Assignment are true.
7. No Burdensome Agreements. Each Grantor represents and warrants that
it is not a party to any contract or agreement and is not subject to any
contingent liability that does or may impair such Grantor's ability to perform
under the terms of this Assignment. Each Grantor further represents and warrants
that the execution and performance of this Assignment will not cause a default,
acceleration or other event under any other contract or agreement to which it or
any property of the Grantor is subject, and will not result in the imposition of
any charge, penalty, lien or other encumbrance against any of the Grantor's
property except in favor of the Agent for the benefit of the Lenders.
8. Legal and Binding Agreement. Each Grantor represents and warrants
that the execution and performance of this Assignment will not violate any
judicial or administrative order or governmental law or regulation, and that
this Assignment is valid, binding and enforceable in every respect according to
its terms.
9. No Consent Required. Each Grantor represents and warrants that its
execution, delivery and performance of this Assignment do not require the
consent of or the giving of notice to any third party including, but not limited
to, any other lender, governmental body or regulatory authority.
10. No Default. Each Grantor represents and warrants that, as of its
execution of this Assignment, no default exists hereunder and no condition
exists which, with the giving of notice, the passing of time, or both, would
constitute such a default.
11. Event of Default Defined. The occurrence of an event which would
constitute an Event of Default under and as defined in the 364-Day Facility or
the Multi-Year Facility shall be an Event of Default hereunder (an "Event of
Default").
12. Remedies Upon Default. Upon the occurrence of an Event of Default
and during the continuation thereof, the Agent may pursue any or all of the
following remedies, without notice to the Grantors except as required below:
(a) Notice to Obligors. The Agent may notify any or all of the
Obligors to make payments and give notices pertaining to the Collateral
Notes directly to the Agent.
(b) Rights of Holder. The Agent may exercise any or all rights
of the holder of the Collateral Notes. Without limiting the foregoing,
the Agent may initiate any administrative or judicial proceeding that
it may deem necessary in the course of enforcing any rights under any
Collateral Note. Any administrative or judicial action or other action
taken by the Agent pursuant to any Collateral Note may be taken by the
Agent in its own name or in a Grantor's name. The Agent may enter into
any amendment or extension of any Collateral Note and may grant any
indulgences with respect thereto that the Agent may deem appropriate in
the course of exercising its rights under any Collateral Note. The
Grantors hereby appoint the Agent as their attorney-in-fact to take any
action authorized by this Assignment upon default. The Grantors
acknowledge that this power of attorney is coupled with an interest and
is irrevocable.
(c) Sale of Collateral Notes. The Agent may sell any or all of
the Collateral Notes pursuant to the Agent's rights under the UCC. Any
such sale may be either public or private. If public, the sale may be
postponed by announcement at the scheduled time and place and adjourned
to another time or place, or both. It is agreed that ten (10) days'
notice of any sale is commercially reasonable notice thereof. Any
public sale may be adjourned to a different time, place, or both by
announcement at the advertised time and place of sale, without further
publication. Any advertised sale may be canceled, in the Agent's
discretion, either before or after the opening of bidding. The Agent
shall transfer the Collateral Note(s) being sold to any purchaser
thereof by endorsing the Collateral Note(s) to the purchaser's order,
without warranty or recourse on the part of the Agent.
(d) Setoff. The Lenders may exercise their right of setoff as
provided in the Credit Agreements.
(e) Other Remedies. The Agent may pursue any other remedies
available under this Assignment, the Credit Agreements or any other
Credit Document evidencing or securing the Secured Obligations or
otherwise available to the Agent at law or equity. All such rights and
remedies shall be cumulative and no one of them shall exclude or
preclude the other(s).
(f) Application of Proceeds. Upon the occurrence and during
the continuation of an Event of Default, any payments in respect of the
Secured Obligations and any proceeds of the Collateral Notes, when
received by the Agent or any of the holders of the Secured Obligations
in cash or its equivalent, will be applied in reduction of the Secured
Obligations in the order set forth below:
(i) First, to the payment of the costs and expenses
of the Agent (including without limitation reasonable
attorneys' fees) incurred in connection with the execution of
its duties as the Agent, in exercising or attempting to
exercise any right or remedy hereunder or in taking possession
of, protecting, preserving or disposing of any Collateral
Notes, and all protective advances made by the Agent with
respect to the Collateral Notes under or pursuant to the terms
hereof;
(ii) Second, to the payment of any fees owed to the
agent under either of the Credit Agreements;
(iii) Third, to the payment of all out-of-pocket
expenses (including without limitation reasonable attorneys'
fees) of each of the Secured Parties in connection with
enforcing its rights under the Credit Documents or otherwise
with respect to the Secured Obligations owing to such Secured
Party;
(iv) Fourth, to the Lenders, ratably, in accordance
with the respective amounts of the Secured Obligations
constituting the then aggregate unpaid
principal amount of the Loans, together with all accrued and
unpaid interest thereon at such time; and
(v) Last, after payment in full of the Secured
Obligations, to the payment of the surplus, if any, to whoever
may be lawfully entitled to receive such surplus.
Each Grantor irrevocably waives the right to direct the application of such
payments and proceeds and acknowledges and agrees that the Agent shall have the
continuing and exclusive right to apply and reapply any and all such payments
and proceeds in the Agent's sole discretion, notwithstanding any entry to the
contrary upon any of its books and records. Payments by the Agent in respect of
(i) Secured Obligations related to the 364-Day Facility shall be made to the
agent under the 364-Day Facility for distribution to the 364-Day Lenders in
accordance with the 364-Day Facility, (ii) Secured Obligations related to the
Multi-Year Facility shall be made to the agent under the Multi-Year Facility for
distribution to the Multi-Year Lenders in accordance with the Multi-Year
Facility and (iii) Secured Obligations related to Hedging Agreements shall be
made to the party entitled thereto.
13. Incorporation of Exhibits. All Exhibits referred to in this
Assignment are incorporated herein by this reference.
14. Indulgence Not Waiver. The Lenders' or the Agent's indulgence in
the existence of an Event of Default hereunder or any other departure from the
terms of this Assignment shall not prejudice their rights to declare a default
or otherwise demand strict compliance with this Assignment.
15. Cumulative Remedies. The remedies provided the Agent in this
Assignment are not exclusive of any other remedies that may be available to the
Agent under any other document or at law or equity.
16. Amendment and Waiver in Writing. This Assignment and the provisions
hereof may not be amended, waived, modified, changed, discharged or terminated
except as set forth in Section 10.15 of each of the Credit Agreements.
17. Assignment. This Assignment shall create a continuing security
interest in the Collateral Notes and shall be binding upon each Grantor, its
successors and assigns, and shall inure, together with the rights and remedies
of the Agent and the holders of the Secured Obligations hereunder, to the
benefit of the Agent and the holders of the Secured Obligations and their
successors and permitted assigns; provided, however, that none of the Grantors
may assign its rights or delegate its duties hereunder without the prior written
consent of the requisite Lenders under the Credit Agreements. To the fullest
extent permitted by law, each Grantor hereby releases the Agent and each holder
of the Secured Obligations, and their respective successors and assigns, from
any liability for any act or omission relating to this Assignment or the
Collateral Notes, except for any liability arising from the gross negligence or
willful misconduct of the Agent or such holder, or their respective officers,
employees or agents.
18. Entirety. This Assignment, the Credit Agreements, the other Credit
Documents and the other documents relating to the Secured Obligations represent
the entire agreement of the parties hereto and thereto, and supersede all prior
agreements and understandings, oral or written, if any, including any commitment
letters or correspondence relating to the Credit Agreements, the other Credit
Documents, any other documents relating to the Secured Obligations, or the
transactions contemplated herein and therein.
19. Severability. If any provision of this Assignment is determined to
be illegal, invalid or unenforceable, such provision shall be fully severable
and the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
20. Time of Essence. Time is of the essence of this Assignment, and all
dates and time periods specified herein shall be strictly observed, except that
the Agent may permit specific deviations therefrom by its written consent.
21. Governing Law; Submission to Jurisdiction; Venue. THIS ASSIGNMENT
AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA.
The provisions of each of the Credit Agreements relating to submission to
jurisdiction and venue are hereby incorporated by reference herein, mutatis
mutandis.
22. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
EACH OF THE PARTIES TO THIS ASSIGNMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS ASSIGNMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
23. Gender and Number. Words used herein indicating gender or number
shall be read as context may require.
24. Captions Not Controlling. Captions and headings have been included
in this Assignment for the convenience of the parties, and shall not be
construed as affecting the content of the respective paragraphs.
25. Amendment and Restatement. Notwithstanding the amendment and
restatement of the Original Assignment on the date hereof, this Assignment
continues and does not terminate or nullify any of the liens or security
interests heretofore created or granted by the Grantor in favor of the Agent or
in favor of Bank of America, N.A., in its capacity as the agent under the 1997
Loan Agreement, and all such existing liens and security interests shall remain
in full force and effect without interruption on the attachment of perfection of
any such liens and security interests.
26. Joint and Several Obligations of Grantors.
(a) Each of the Grantors is accepting joint and several
liability hereunder in consideration of the financial accommodation to
be provided by the Lenders under the Credit Agreements, for the mutual
benefit, directly and indirectly, of each of such Grantors and in
consideration of the undertakings of each of such Grantors to accept
joint and several liability for the obligations of each of them.
(b) Each of the Grantors jointly and severally hereby
irrevocably and unconditionally accepts, not merely as a surety but
also as a co-debtor, joint and several liability with the other
Grantors with respect to the payment and performance of all of the
Secured Obligations of any such Grantor arising under this Assignment,
the Credit Agreements or the other Credit Documents, it being the
intention of the parties hereto that all the Secured Obligations shall
be the joint and several obligations of each of the Grantors without
preferences or distinction among them.
(c) Notwithstanding any provision to the contrary contained
herein, in either of the Credit Agreements or in any other of the other
Credit Documents, to the extent the obligations of a Grantor shall be
adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law
relating to fraudulent conveyances or transfers) then the obligations
of each Grantor hereunder shall be limited to the maximum amount that
is permissible under applicable law (whether federal or state and
including, without limitation, the Bankruptcy Code).
27. Authorization of Financing Statements. The Grantors authorize the
Agent to file financing statements (including renewal statements and in lieu
statements) and amendments thereof and supplements thereto with respect to the
Collateral Notes in such form and in such filing offices as the Agent reasonably
determines appropriate to perfect the security interests of the Agent under this
Assignment. Any financing statement filed by the Agent may contain a general
description of the collateral covered thereby, as permitted by the UCC, which
states that the security interest attaches to all personal property of the
debtor.
[remainder of page intentionally left blank]
Each of the parties hereto has caused a counterpart of this Assignment
to be duly executed and delivered as of the date first above written.
GRANTORS: RENAL CARE GROUP, INC., a Delaware corporation
By:
------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
RCG FINANCE, INC., a Delaware corporation
By:
------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
SCHEDULE A
A. Description of Collateral Notes
Name of Grantor: ___________________
Face Amount of Note Obligor Address Date of Note
------------------- ------- ------- ------------
Exhibit 5.23
FORM OF JOINDER AGREEMENT
JOINDER AGREEMENT
THIS JOINDER AGREEMENT (this "Agreement"), dated as of _____________,
200_, is entered into between _____________________, a ___________________ (the
"New Subsidiary") and Bank of America, N.A., in its capacity as Agent (the
"Agent") under that certain Second Amended and Restated Loan Agreement (as
renewed, extended, amended, restated or modified from time to time, the "Loan
Agreement") dated as of July ___, 2002 among Renal Care Group, Inc. (the
"Borrower"), the Lenders party thereto and the Agent. All capitalized terms used
herein and not otherwise defined shall have the meanings set forth in the Loan
Agreement.
The New Subsidiary and the Agent, for the benefit of the Lenders,
hereby agree as follows:
1. The New Subsidiary hereby acknowledges, agrees and confirms that, by
its execution of this Agreement, the New Subsidiary will be deemed to be a
Credit Party and a Guarantor under the Loan Agreement and a "Guarantor" party to
the Guaranty Agreement for all purposes of the Guaranty Agreement and shall have
all of the obligations of a Guarantor under the Guaranty Agreement as if it had
executed the Guaranty Agreement. The New Subsidiary hereby ratifies, as of the
date hereof, and agrees to be bound by, all of the terms, provisions and
conditions contained in the Guaranty Agreement, including without limitation (a)
all of the representations and warranties of the Guarantors set forth therein,
and (b) all of the affirmative and negative covenants of the Guarantors set
forth therein. Without limiting the generality of the foregoing terms of this
paragraph 1, the New Subsidiary hereby guarantees, jointly and severally with
the other Guarantors, to the Agent and the Lenders, as provided in Section 2 of
the Guaranty Agreement, prompt payment of the Guaranteed Obligations in full
when due (whether at stated maturity, as a mandatory prepayment, by
acceleration, as a mandatory cash collateralization or otherwise) strictly in
accordance with the terms thereof and agrees that if any of the Guaranteed
Obligations are not paid in full when due (whether at stated maturity, as a
mandatory prepayment, by acceleration, as a mandatory cash collateralization or
otherwise), the New Subsidiary will promptly pay the same, without any demand or
notice whatsoever (except for any such notice required by the Loan Agreement),
and that in the case of any extension of time of payment or renewal of any of
the Guaranteed Obligations, the same will be promptly paid in full when due
(whether at extended maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) in accordance with the terms of
such extension or renewal. Without limiting the generality of the foregoing
terms of this paragraph 1, the New Subsidiary hereby (a) acknowledges, agrees
and confirms that, by its execution of this Agreement, the New Subsidiary will
be deemed a party to the Security Agreement as a "Grantor" and a party to the
Collateral Assignment of Promissory Notes as a "Grantor", (b) acknowledges and
agrees that its obligations under the Guaranty Agreement are secured in
accordance with the terms of the Security Agreement, the Collateral Assignment
of Promissory Notes and the other Loan Documents and that the Lenders may
exercise their remedies thereunder in accordance with the terms thereof, (c)
grants to the Agent, for the benefit of the Lenders, a continuing security
interest in, and a right to set off against, any and all right, title and
interest of the New Subsidiary in and to the Collateral Notes (as defined in the
Collateral Assignment of Promissory Notes) identified on Schedule A attached
hereto and all of the Collateral (as defined in the Security Agreement). The New
Subsidiary hereby represents and warrants to the Agent and the Lenders that (a)
set forth on Schedule B attached hereto is (i) a list of all locations in the
United States where any personal property of the New Subsidiary is located and
(ii) the chief executive office, principal place of business and jurisdiction of
organization of the New Subsidiary, (b)
Page 2
set forth on Schedule C attached hereto is a complete and accurate list of all
Subsidiaries of the New Subsidiary, and (c) the New Subsidiary's legal name is
as shown in this Agreement and the New Subsidiary has not in the past four
months changed its name, been party to a merger, consolidation or other change
in structure or used any tradename except as set forth on Schedule D attached
hereto. Each of Schedule 4.21, Schedule 4.22 and 4.29 of the Loan Agreement,
Schedule A of the Security Agreement and Exhibit A of the Collateral Assignment
of Promissory Notes are hereby deemed amended to include the information on
Schedule A through Schedule C attached hereto, as applicable.
2. If required, the New Subsidiary is, simultaneously with the
execution of this Agreement, executing and delivering such Loan Documents (and
such other documents and instruments) as requested by the Agent in accordance
with Section 5.23 of the Loan Agreement.
3. The address of the New Subsidiary for purposes of Section 10.1 of
the Loan Agreement is as follows:
--------------------------
--------------------------
--------------------------
--------------------------
4. The New Subsidiary hereby waives acceptance by the Agent and the
Lenders of the guaranty by the New Subsidiary under the Loan Agreement upon the
execution of this Agreement by the New Subsidiary.
5. This Agreement may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall constitute one and the same instrument.
6. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF GEORGIA.
IN WITNESS WHEREOF, the New Subsidiary has caused this Agreement to be
duly executed by its authorized officer, and the Agent, for the benefit of the
Lenders, has caused the same to be accepted by its authorized officer, as of the
day and year first above written.
[NEW SUBSIDIARY]
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Acknowledged and accepted:
BANK OF AMERICA, N.A., as Agent
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Exhibit 9.10
ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Second Amended and Restated Loan
Agreement dated as of July __, 2002 (as renewed, extended, amended, restated or
modified from time to time, the "Loan Agreement") among Renal Care Group, Inc.
(the "Borrower"), the Lenders identified therein and Bank of America, N.A., as
Agent. All capitalized terms used herein and not otherwise defined shall have
the meanings set forth in the Loan Agreement.
The "Assignor" and the "Assignee" referred to on Schedule 1 agree as
follows:
1. The Assignor hereby sells and assigns to the Assignee, without
recourse and without representation or warranty except as expressly set forth
herein, and the Assignee hereby purchases and assumes from the Assignor, an
interest in and to the Assignor's rights and obligations under the Loan
Agreement and the other Loan Documents as of the date hereof equal to the
percentage interest specified on Schedule 1 of all outstanding rights and
obligations under the Loan Agreement and the other Loan Documents. After giving
effect to such sale and assignment, the Assignee's Commitment and the amount of
the Loans owing to the Assignee will be as set forth on Schedule 1.
2. The Assignor (i) represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim; (ii) makes no representation or
warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with the Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of the Loan Documents or any other instrument or document furnished
pursuant thereto; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of any Credit Party or
the performance or observance by any Credit Party of any of its obligations
under the Loan Documents or any other instrument or document furnished pursuant
thereto.
3. The Assignee (i) represents and warrants that it is a commercial
lender, other financial institution or other "accredited" investor (as defined
in SEC Regulation D) which makes or acquires or loans in the ordinary course of
business and that it will make or acquire Loans for its own account in the
ordinary course of business, (ii) confirms that it has received a copy of the
Loan Agreement, together with copies of the financial statements referred to in
Section 4.6 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (iii) agrees that it will, independently and without
reliance upon the Agent, the Assignor or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Agreement; (iv) confirms that it is an Eligible Assignee; (v) appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers and discretion under the Loan Agreement as are delegated to the
Agent by the terms thereof, together with such powers and discretion as are
reasonably incidental thereto; (vi) agrees that it will perform in accordance
with their terms all of the obligations that by the terms of the Loan Agreement
are required to be performed by it as a Lender; and (vii) attaches any U.S.
Internal Revenue Service or other forms required under Section 9.13.
4. Following the execution of this Assignment and Acceptance, it will
be delivered to the Agent for acceptance and recording by the Agent. The
effective date for this Assignment and Acceptance (the "Effective Date") shall
be the date of acceptance hereof by the Agent, unless otherwise specified on
Schedule 1.
Page 2
5. Upon such acceptance and recording by the Agent, as of the Effective
Date, (i) the Assignee shall be a party to the Loan Agreement and, to the extent
provided in this Assignment and Acceptance, have the rights and obligations of a
Lender thereunder and (ii) the Assignor shall, to the extent provided in this
Assignment and Acceptance, relinquish its rights and be released from its
obligations under the Loan Agreement.
6. Upon such acceptance and recording by the Agent, from and after the
Effective Date, the Agent shall make all payments under the Loan Agreement and
the Notes in respect of the interest assigned hereby (including, without
limitation, all payments of principal, interest and commitment fees with respect
thereto) to the Assignee. The Assignor and Assignee shall make all appropriate
adjustments in payments under the Loan Agreement and the Notes for periods prior
to the Effective Date directly between themselves.
7. This Assignment and Acceptance shall be governed by, and construed
in accordance with, the laws of the State of Georgia.
8. This Assignment and Acceptance may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. Delivery of an executed
counterpart of Schedule 1 to this Assignment and Acceptance by telecopier shall
be effective as delivery of a manually executed counterpart of this Assignment
and Acceptance.
Page 3
IN WITNESS WHEREOF, the Assignor and the Assignee have caused this
Assignment and Acceptance to be executed by their officers thereunto duly
authorized as of the date hereof.
____________________, as Assignor
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
_____________________, as Assignee
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Notice address of Assignee:
(Assignee)
--------------------------------------------
--------------------------------------------
Attn: _____________________
Telephone: (___) ________
Telecopy: (___) ________
CONSENTED TO:
BANK OF AMERICA, N.A.,
as Agent
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
RENAL CARE GROUP, INC.
By:
--------------------------------------------------
Name:
------------------------------------------------
Title:
-----------------------------------------------
NationsBank of Tennessee, N.A., Agent
Lenders under First Amended and Restated Loan Agreement
August ___, 1997
Page 11
SCHEDULE 1.1(A)
COMMITMENTS
----------------------------------------------------------------------------------------------------------------------
REVOLVING LOAN SWINGLINE LOAN
LENDER COMMITMENT PERCENTAGE COMMITMENT PERCENTAGE
----------------------------------------------------------------------------------------------------------------------
Bank of America, N.A. $33,333,333.33 33.33333% $10,000,000 $100.00000%
----------------------------------------------------------------------------------------------------------------------
SunTrust Bank $30,000,000.00 30.00000%
----------------------------------------------------------------------------------------------------------------------
AmSouth Bank $20,000,000.00 20.00000%
----------------------------------------------------------------------------------------------------------------------
Xxxxx Fargo Bank, National Association $16,666,666.67 16.66667%
----------------------------------------------------------------------------------------------------------------------
Total: $100,000,000.00 100.00000% $10,000,000 100.00000%
----------------------------------------------------------------------------------------------------------------------
NationsBank of Tennessee, N.A., Agent
Lenders under First Amended and Restated Loan Agreement
August ___, 1997
Page 11
SCHEDULE 1.1(B)
EXISTING LETTERS OF CREDIT
NationsBank of Tennessee, N.A., Agent
Lenders under First Amended and Restated Loan Agreement
August ___, 1997
Page 11
SCHEDULE 4.20
SUBSIDIARIES
SCHEDULE 4.26
INTER-COMPANY NOTES
SCHEDULE 5.11
INSURANCE
SCHEDULE 6.1.7
EXISTING DEBT
SCHEDULE 6.3
EXISTING INVESTMENTS
SCHEDULE 6.17
SALE/LEASEBACK TRANSACTIONS
