EXHIBIT 10.1
EXECUTION VERSION
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CREDIT AGREEMENT
DATED AS OF MARCH __, 2006
by and among
RADNET MANAGEMENT, INC.
as Borrower
and
THE OTHER PERSONS PARTY HERETO THAT
ARE DESIGNATED AS CREDIT PARTIES
and
GENERAL ELECTRIC CAPITAL CORPORATION
as Agent, L/C Issuer and a Lender
and
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
as Lenders
and
GE CAPITAL MARKETS, INC.
as Lead Arranger
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TABLE OF CONTENTS
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Page
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SECTION 1. AMOUNTS AND TERMS OF LOANS..............................................................................1
1.1 Loans...........................................................................................1
1.2 Interest and Applicable Margins.................................................................9
1.3 Fees...........................................................................................11
1.4 Payments.......................................................................................12
1.5 Prepayments....................................................................................13
1.6 Maturity.......................................................................................14
1.7 Loan Accounts..................................................................................14
1.8 Yield Protection...............................................................................15
1.9 Taxes..........................................................................................16
SECTION 2. CONDITIONS TO LOANS....................................................................................18
2.1 Conditions to Initial Loans....................................................................18
2.2 Conditions to All Loans........................................................................19
SECTION 3. REPRESENTATIONS AND WARRANTIES.........................................................................20
3.1 Organization, Powers, Capitalization and Good Standing.........................................20
3.2 Disclosure.....................................................................................21
3.3 No Material Adverse Effect.....................................................................21
3.4 No Conflict....................................................................................21
3.5 Financial Statements and Projections...........................................................21
3.6 Solvency.......................................................................................22
3.7 Use of Proceeds; Margin Regulations............................................................22
3.8 Brokers........................................................................................22
3.9 Compliance with Laws...........................................................................22
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3.10 Intellectual Property..........................................................................23
3.11 Investigations, Audits, Etc....................................................................23
3.12 Employee Matters...............................................................................23
3.13 Litigation; Adverse Facts......................................................................23
3.14 Ownership of Property; Liens...................................................................23
3.15 Environmental Matters..........................................................................24
3.16 ERISA..........................................................................................25
3.17 Deposit and Disbursement Accounts..............................................................26
3.18 Agreements and Other Documents.................................................................26
3.19 Insurance......................................................................................26
3.20 Taxes and Tax Returns..........................................................................26
3.21 Senior Indebtedness and Designated Senior Indebtedness.........................................27
3.22 Health Care Matters............................................................................27
SECTION 4. AFFIRMATIVE COVENANTS..................................................................................29
4.1 Compliance With Laws and Contractual Obligations...............................................29
4.2 Insurance......................................................................................30
4.3 Inspection; Lender Meeting.....................................................................30
4.4 Organizational Existence.......................................................................31
4.5 Environmental Matters..........................................................................31
4.6 Landlords' Agreements, Mortgagee Agreements, Bailee Letters and Real Estate Purchases..........32
4.7 Further Assurances.............................................................................32
4.8 Payment of Taxes...............................................................................33
4.9 Cash Management Systems........................................................................33
4.10 Interest Rate Agreements.......................................................................33
4.11 Healthcare Matters.............................................................................33
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SECTION 5. NEGATIVE COVENANTS.....................................................................................34
5.1 Indebtedness...................................................................................34
5.2 Liens and Related Matters......................................................................36
5.3 Investments....................................................................................36
5.4 Contingent Obligations.........................................................................37
5.5 Restricted Payments............................................................................38
5.6 Restriction on Fundamental Changes.............................................................39
5.7 Disposal of Assets or Subsidiary Stock.........................................................42
5.8 Transactions with Affiliates...................................................................42
5.9 Conduct of Business............................................................................43
5.10 Changes Relating to Indebtedness...............................................................43
5.11 Fiscal Year....................................................................................43
5.12 Press Release; Public Offering Materials.......................................................43
5.13 Subsidiaries...................................................................................43
5.14 Deposit Accounts...............................................................................44
5.15 Hazardous Materials............................................................................44
5.16 ERISA..........................................................................................44
5.17 SaleLeasebacks.................................................................................44
5.18 Prepayments of Other Indebtedness..............................................................44
5.19 Changes to Material Contracts..................................................................44
SECTION 6. FINANCIAL COVENANTS/REPORTING..........................................................................44
6.1 Financial Covenants............................................................................44
6.2 Financial Statements and Other Reports.........................................................46
6.3 Accounting Terms; Utilization of GAAP for Purposes of Calculations Under Agreement.............50
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SECTION 7. DEFAULT, RIGHTS AND REMEDIES...........................................................................51
7.1 Event of Default...............................................................................51
7.2 Suspension or Termination of Commitments.......................................................53
7.3 Acceleration and other Remedies................................................................53
7.4 Performance by Agent...........................................................................54
7.5 Application of Proceeds........................................................................54
SECTION 8. ASSIGNMENT AND PARTICIPATION...........................................................................55
8.1 Assignments and Participations; Binding Effect.................................................55
8.2 Agent..........................................................................................57
8.3 Set Off and Sharing of Payments................................................................64
8.4 Disbursement of Funds..........................................................................64
8.5 Disbursements of Advances; Payment.............................................................65
SECTION 9. MISCELLANEOUS..........................................................................................66
9.1 Indemnities....................................................................................66
9.2 Amendments and Waivers.........................................................................67
9.3 Notices........................................................................................68
9.4 Failure or Indulgence Not Waiver; Remedies Cumulative..........................................71
9.5 Marshaling; Payments Set Aside.................................................................71
9.6 Severability...................................................................................71
9.7 Lenders' Obligations Several; Independent Nature of Lenders' Rights............................71
9.8 Headings.......................................................................................71
9.9 Applicable Law.................................................................................71
9.10 Successors and Assigns.........................................................................72
9.11 No Fiduciary Relationship; Limited Liability...................................................72
9.12 Construction...................................................................................72
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9.13 Confidentiality................................................................................72
9.14 CONSENT TO JURISDICTION........................................................................73
9.15 WAIVER OF JURY TRIAL...........................................................................73
9.16 Survival of Warranties and Certain Agreements..................................................73
9.17 Entire Agreement...............................................................................74
9.18 Counterparts; Effectiveness....................................................................74
9.19 Replacement of Lenders.........................................................................74
9.20 Delivery of Termination Statements and Mortgage Releases.......................................75
9.21 Subordination of Intercompany Debt.............................................................75
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INDEX OF APPENDICES
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Annexes
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Annex A - Definitions
Annex B - Pro Rata Shares and Commitment Amounts
Annex C - Closing Checklist
Annex D - Pro Forma
Annex E - Lenders' Bank Accounts
Annex F - Compliance and Excess Cash Flow Certificate
Exhibits
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Exhibit 1.1(a) - Term Note B
Exhibit 1.1(b)(i) - Revolving Note
Exhibit 1.1(b)(ii) - Notice of Revolving Credit Advance
Exhibit 1.1(c) - Swing Line Note
Exhibit 1.1(d) - Request for Letter of Credit Issuance
Exhibit 1.2(e) - Notice of Continuation/Conversion
Exhibit 6.2(d) - Borrowing Base Certificate
Exhibit 8.1 - Assignment Agreement
Schedules
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Schedule 3.1(a) - Jurisdictions of Organization and Qualifications
Schedule 3.1(b) - Capitalization
Schedule 3.7 - Use of Proceeds
Schedule 3.10 - Intellectual Property
Schedule 3.11 - Investigations and Audits
Schedule 3.12 - Employee Matters
Schedule 3.13 - Litigation
Schedule 3.14 - Real Estate
Schedule 3.15 - Environmental Matters
Schedule 3.16 - ERISA
Schedule 3.17 - Deposit and Disbursement Accounts
Schedule 3.18 - Agreements and Other Documents
Schedule 3.19 - Insurance
Schedule 3.22 - Health Care Matters
Schedule 5.1 - Indebtedness
Schedule 5.2 - Liens
Schedule 5.4 - Contingent Obligations
Schedule 5.8 - Affiliate Transactions
Schedule 5.9 - Business Description
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CREDIT AGREEMENT
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This CREDIT AGREEMENT is dated as of March __, 2006 and entered into by
and among RADNET MANAGEMENT, INC., a California corporation ("BORROWER"), the
other persons designated as "Credit Parties", the financial institutions who are
or hereafter become parties to this Agreement as Lenders, and GENERAL ELECTRIC
CAPITAL CORPORATION, a Delaware corporation (in its individual capacity "GE
CAPITAL"), as the initial L/C Issuer and as Agent.
R E C I T A L S:
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WHEREAS, Borrower desires that Lenders extend a term credit facility
and a revolving credit facility to Borrower to fund the repayment of certain
indebtedness of Borrower, to provide working capital financing for Borrower and
its Subsidiaries and to provide funds for other general corporate purposes of
Borrower and its Subsidiaries; and
WHEREAS, Borrower desires to secure all of its Obligations (as
hereinafter defined) under the Loan Documents (as hereinafter defined) by
granting to Agent, for the benefit of Agent and Lenders, a security interest in
and lien upon substantially all of its personal and real property; and
WHEREAS, Primedex Health Systems, Inc., a New York corporation
("HOLDINGS") that owns all of the Stock of Borrower is willing to guaranty all
of the Obligations and pledge to Agent, for the benefit of Agent and Lenders,
all of the Stock of Borrower and substantially all of its other personal and
real property to secure the Obligations; and
WHEREAS, each of ▇▇▇▇▇▇▇ Radiology Medical Group III, a California
general partnership ("▇▇▇▇▇▇▇"), ▇▇▇▇▇▇▇ Radiology Medical Group, Inc., a
California corporation ("▇▇▇▇▇▇▇ RADIOLOGY"), ProNet Imaging Medical Group,
Inc., a California corporation ("PRONET"), Diagnostic Imaging Services, Inc., a
Delaware corporation, and Borrower's Domestic Subsidiaries is willing to
guaranty all of the Obligations of Borrower and to grant to Agent, for the
benefit of Agent and Lenders, a security interest in and lien upon substantially
all of its personal and real property to secure the Obligations; and
WHEREAS, all capitalized terms herein shall have the meanings ascribed
thereto in ANNEX A hereto, which is incorporated herein by reference.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, Borrower, Credit Parties, Lenders and
Agent agree as follows:
AMOUNTS AND TERMS OF LOANS
LOANS. Subject to the terms and conditions of this Agreement and in reliance
upon the representations and warranties of Borrower and the other Credit Parties
contained herein:
TERM LOAN B. Each Term Lender agrees, severally and not jointly, to lend to
Borrower in one draw, on the Closing Date, its Pro Rata Share of the aggregate
amount of $86,000,000 (the "TERM LOAN B"). Borrower shall repay Term Loan B
through periodic payments on the dates and in the amounts indicated below
("SCHEDULED INSTALLMENTS").
Date Scheduled Installment
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Beginning with April 30, 2006, $215,000
each April 30, July 31, October
31 and January 31 occurring
prior to April 30, 2011
March [__], 2011 $81,700,000
The final installment shall in all events equal the entire remaining
principal balance of the Term Loan B. Notwithstanding the foregoing, the
outstanding principal balance of the Term Loan B shall be due and payable in
full on the Commitment Termination Date. Amounts borrowed under this SECTION
1.1(A) and repaid may not be reborrowed.
At the request of the applicable Lender, such Lender's Term Loan B
shall be evidenced by promissory notes substantially in the form of EXHIBIT
1.1(A) (as amended, modified, extended, substituted or replaced from time to
time, each a "TERM NOTE B" and, collectively, the "TERM NOTES B"), and, except
as provided in SECTION 1.7, Borrower shall execute and deliver each Term Note B
to the applicable Lender. Each Term Note B shall represent the obligation of
Borrower to pay the amount of the applicable Lender's Term Loan B Commitment,
together with interest thereon.
REVOLVING LOANS.
Each Revolving Lender agrees, severally and not jointly, to make available to
Borrower from time to time until the Commitment Termination Date its Pro Rata
Share of advances (each a "REVOLVING CREDIT ADVANCE") requested by Borrower
hereunder. The Pro Rata Share of the Revolving Loan of any Revolving Lender
(including, without duplication, Swing Line Loans) shall not at any time exceed
its separate Revolving Loan Commitment. Revolving Credit Advances may be repaid
and reborrowed; provided, that the amount of any Revolving Credit Advance to be
made at any time shall not exceed Borrowing Availability. The Revolving Loans
shall be repaid in full on the Commitment Termination Date. If requested by a
Revolving Lender, Borrower shall execute and deliver to such Revolving Lender a
note to evidence the Revolving Loan Commitment of that Revolving Lender. Each
such note shall be in the maximum principal amount of the Revolving Loan
Commitment of the applicable Revolving Lender, dated the Closing Date and
substantially in the form of EXHIBIT 1.1(B)(I) (as amended, modified, extended,
substituted or replaced from time to time, each a "REVOLVING NOTE" and,
collectively, the "REVOLVING NOTES"). If at any time the aggregate outstanding
Revolving Loan exceeds the Borrowing Base (any such excess Revolving Loan is
herein referred to as an "OVERADVANCE"), Lenders shall not be obligated to make
Revolving Credit Advances, no additional Letters of Credit shall be issued and
the Revolving Loan must be repaid immediately and Letters of Credit cash
collateralized in an amount sufficient to eliminate any Overadvance. All
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Overadvances shall constitute Index Rate Loans and at the written request of
Agent or the Requisite Lenders shall bear interest at the Index Rate plus the
Revolving Loan Applicable Index Rate Margin and shall bear interest at the
Default Rate only if not repaid within three (3) Business Days. For funding
requests for Revolving Credit Advances to be funded as Index Rate Loans of
$5,000,000 or less, written notice must be provided by 1:00 p.m. (New York time)
on the Business Day on which the Revolving Credit Advance is to be made; for
funding requests for Revolving Credit Advances to be funded as Index Rate Loans
of more than $5,000,000, written notice must be provided by 1:00 p.m. (New York
time) on the Business Day before which the Revolving Credit Advance is to be
made. All Revolving Credit Advances to be funded as LIBOR Loans require three
(3) Business Days prior written notice. Written notices for all funding requests
shall be in the form attached as EXHIBIT 1.1(B)(II) ("NOTICE OF REVOLVING CREDIT
ADVANCE").
Swing Line Facility.
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Agent shall notify the Swing Line Lender upon Agent's receipt of any Notice of
Revolving Credit Advance. Subject to the terms and conditions hereof, the Swing
Line Lender may, in its discretion, make available from time to time until the
Commitment Termination Date advances (each, a "SWING LINE ADVANCE") in
accordance with any such notice. The provisions of this SECTION 1.1(C) shall not
relieve Revolving Lenders of their obligations to make Revolving Credit Advances
under SECTION 1.1(B); provided that if the Swing Line Lender makes a Swing Line
Advance pursuant to any such notice, such Swing Line Advance shall be in lieu of
any Revolving Credit Advance that otherwise may be made by Revolving Lenders
pursuant to such notice. Except as provided in SECTION 1.1(B)(II) above, the
aggregate amount of Swing Line Advances outstanding shall not exceed at any time
the lesser of (A) the Swing Line Commitment and (B) Borrowing Availability
("SWING LINE AVAILABILITY"). Until the Commitment Termination Date, Borrower may
from time to time borrow, repay and reborrow under this SECTION 1.1(C). Each
Swing Line Advance shall be made pursuant to a Notice of Revolving Credit
Advance delivered by Borrower to Agent in accordance with SECTION 1.1(B). Unless
the Swing Line Lender has received at least one (1) Business Day's prior written
notice from Requisite Revolving Lenders instructing it not to make a Swing Line
Advance, the Swing Line Lender shall, notwithstanding the failure of any
condition precedent set forth in SECTION 2.2, be entitled to fund that Swing
Line Advance, and to have each Revolving Lender make Revolving Credit Advances
in accordance with SECTION 1.1(C)(III) or purchase participating interests in
accordance with SECTION 1.1(C)(IV). Notwithstanding any other provision of this
Agreement or the other Loan Documents, the Swing Line Loan shall constitute an
Index Rate Loan. Unless refunded as a Revolving Loan as provided in Section
1.1(c)(iii) below, Borrower shall repay the aggregate outstanding principal
amount of the Swing Line Loan upon demand therefor by Agent. The entire unpaid
balance of the Swing Line Loan and all other noncontingent Obligations shall be
immediately due and payable in full in immediately available funds on the
Commitment Termination Date if not sooner paid in full.
Borrower shall execute and deliver to the Swing Line Lender a promissory note to
evidence the Swing Line Commitment. Such note shall be in the principal amount
of the Swing Line Commitment of the Swing Line Lender, dated the Closing Date
and substantially in the form of EXHIBIT 1.1(C) (as amended, modified, extended,
substituted or replaced from time to time, the "SWING LINE NOTE"). The Swing
Line Note shall represent the obligation of Borrower to pay the amount of the
Swing Line Commitment or, if less, the aggregate unpaid principal amount of all
Swing Line Advances made to Borrower together with interest thereon as
prescribed in SECTION 1.2.
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The Swing Line Lender, at any time and from time to time in its sole and
absolute discretion but no less frequently than once each week, shall on behalf
of Borrower (and Borrower hereby irrevocably authorizes the Swing Line Lender to
so act on its behalf) request each Revolving Lender (including the Swing Line
Lender) to make a Revolving Credit Advance to Borrower (which shall be an Index
Rate Loan) in an amount equal to that Revolving Lender's Pro Rata Share of the
principal amount of the Swing Line Loan (the "REFUNDED SWING LINE LOAN")
outstanding on the date such notice is given. Unless any of the events described
in SECTIONS 7.1(F) and 7.1(G) has occurred and is continuing (in which event the
procedures of SECTION 1.1(C)(IV) shall apply) and regardless of whether the
conditions precedent set forth in this Agreement to the making of a Revolving
Credit Advance are then satisfied, each Revolving Lender shall disburse directly
to Agent, its Pro Rata Share of a Revolving Credit Advance on behalf of the
Swing Line Lender, prior to 3:00 p.m. (New York time), in immediately available
funds on the Business Day next succeeding the date that notice is given. The
proceeds of those Revolving Credit Advances shall be immediately paid to the
Swing Line Lender and applied to repay the Refunded Swing Line Loan.
If, prior to refunding a Swing Line Loan with a Revolving Credit Advance
pursuant to SECTION 1.1(C)(III), one of the events described in SECTIONS 7.1(F)
or 7.1(G) has occurred and is continuing, then, subject to the provisions of
SECTION 1.1(C)(V) below, each Revolving Lender shall, on the date such Revolving
Credit Advance was to have been made for the benefit of Borrower, purchase from
the Swing Line Lender an undivided participation interest in the Swing Line Loan
in an amount equal to its Pro Rata Share (determined with respect to Revolving
Loans) of such Swing Line Loan. Upon request, each Revolving Lender shall
promptly transfer to the Swing Line Lender, in immediately available funds, the
amount of its participation interest.
Each Revolving Lender's obligation to make Revolving Credit Advances in
accordance with SECTION 1.1(C)(III) and to purchase participation interests in
accordance with SECTION 1.1(C)(IV) shall be absolute and unconditional and shall
not be affected by any circumstance, including (A) any setoff, counterclaim,
recoupment, defense or other right that such Revolving Lender may have against
the Swing Line Lender, Borrower or any other Person for any reason whatsoever;
(B) the occurrence or continuance of any Default or Event of Default; (C) any
inability of Borrower to satisfy the conditions precedent to borrowing set forth
in this Agreement at any time or (D) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing. Swing Line Lender
shall be entitled to recover, on demand, from each Revolving Lender the amounts
required pursuant to SECTIONS 1.1.(C)(III) or 1.1(C)(IV), as the case may be. If
any Revolving Lender does not make available such amounts to Agent or the Swing
Line Lender, as applicable, the Swing Line Lender shall be entitled to recover,
on demand, such amount from such Revolving Lender, together with interest
thereon for each day from the date of non-payment until such amount is paid in
full at the Federal Funds Rate for the first two Business Days and at the Index
Rate thereafter.
LETTERS OF CREDIT. The Revolving Loan Commitment may, in addition to advances
under the Revolving Loan, be utilized (subject to the limitations imposed by
SECTION 1.1(A)), upon the request of Borrower, for the issuance of Letters of
Credit. Immediately upon the issuance by an L/C Issuer of a Letter of Credit,
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and without further action on the part of Agent or any of the Lenders, each
Revolving Lender shall be deemed to have purchased from such L/C Issuer a
participation in such Letter of Credit (or in its obligation under a risk
participation agreement with respect thereto) equal to such Revolving Lender's
Pro Rata Share of the aggregate amount available to be drawn under such Letter
of Credit.
MAXIMUM AMOUNT. The aggregate amount of Letter of Credit Obligations with
respect to all Letters of Credit outstanding or unreimbursed at any time shall
not exceed $2,000,000 ("L/C SUBLIMIT").
REIMBURSEMENT. Borrower shall be irrevocably and unconditionally obligated
forthwith without presentment, demand, protest or other formalities of any kind,
to reimburse any L/C Issuer on demand in immediately available funds for any
amounts paid by such L/C Issuer with respect to a Letter of Credit, including
all reimbursement payments, Fees, Charges, costs and expenses paid by such L/C
Issuer, without duplication of fees otherwise paid by Borrower. Borrower hereby
authorizes and directs Agent, at Agent's option, to debit Borrower's account (by
increasing the outstanding principal balance of the Revolving Credit Advances or
Swing Line Advances made to Borrower) in the amount of any payment made by an
L/C Issuer with respect to any Letter of Credit, and a Notice of Revolving
Credit Advance requesting an Index Rate Loan in such amount shall be deemed to
have been timely given on such date. All amounts paid by an L/C Issuer with
respect to any Letter of Credit that are not immediately repaid by Borrower with
the proceeds of a Revolving Credit Advance, Swing Line Advance or otherwise
shall bear interest payable on demand at the interest rate applicable to
Revolving Credit Advances which are Index Rate Loans plus, at the election of
Agent or Requisite Revolving Lenders, an additional two percent (2.00%) per
annum. Each Revolving Lender agrees to fund its Pro Rata Share of any Revolving
Loan made pursuant to this SECTION 1.1(D)(II). In the event Agent elects not to
debit Borrower's account and Borrower fails to reimburse the L/C Issuer in full
on the date of any payment in respect of a Letter of Credit, Agent shall
promptly notify each Revolving Lender of the amount of such unreimbursed payment
and the accrued interest thereon and each Revolving Lender, on the next Business
Day prior to 3:00 p.m. (New York time), shall deliver to Agent an amount equal
to its Pro Rata Share thereof in same day funds. Each Revolving Lender hereby
absolutely and unconditionally agrees to pay to the L/C Issuer upon demand by
the L/C Issuer such Revolving Lender's Pro Rata Share of each payment made by
the L/C Issuer in respect of a Letter of Credit and reimbursed within one (1)
Business Day by Borrower or satisfied through a debit of Borrower's account.
Each Revolving Lender acknowledges and agrees that its obligations pursuant to
this subsection in respect of Letters of Credit are absolute and unconditional
and shall not be affected by any circumstance whatsoever, including setoff,
counterclaim, the occurrence and continuance of a Default or an Event of Default
or any failure by Borrower to satisfy any of the conditions set forth in SECTION
2.2. If any Revolving Lender fails to make available to the L/C Issuer the
amount of such Revolving Lender's Pro Rata Share of any payments made by the L/C
Issuer in respect of a Letter of Credit as provided in this SECTION 1.1(D)(II),
the L/C Issuer shall be entitled to recover such amount on demand from such
Revolving Lender together with interest at the Index Rate.
REQUEST FOR LETTERS OF CREDIT. Borrower shall give Agent at least three (3)
Business Days prior written notice specifying the date a Letter of Credit is
requested to be issued, the amount and the name and address of the beneficiary
and a description of the transactions proposed to be supported thereby, and the
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expiry date (or extended expiry date) of the Letter of Credit. Each request by
Borrower for the issuance of a Letter of Credit shall be in the form of EXHIBIT
1.1(D). If Agent informs Borrower that the L/C Issuer cannot issue the requested
Letter of Credit directly, Borrower may request that L/C Issuer arrange for the
issuance of the requested Letter of Credit under a risk participation agreement
with another financial institution reasonably acceptable to Agent, L/C Issuer
and Borrower. The issuance of any Letter of Credit under this Agreement shall be
subject to satisfaction of the conditions set forth in SECTION 2.2 and the
conditions that the Letter of Credit (i) supports a transaction benefiting
Borrower or its wholly-owned Subsidiaries and (ii) is in a form, is for an
amount and contains such terms and conditions as are reasonably satisfactory to
the L/C Issuer and, in the case of standby letters of credit, Agent. The initial
notice requesting the issuance of a Letter of Credit shall be accompanied by the
form of the Letter of Credit and the Master Standby Agreement or Master
Documentary Agreement, as applicable, and an application for a Letter of Credit,
if any, then required by the L/C Issuer completed in a manner reasonably
satisfactory to such L/C Issuer. If any provision of any application or
reimbursement agreement is inconsistent with the terms of this Agreement, then
the provisions of this Agreement, to the extent of such inconsistency, shall
control.
EXPIRATION DATES OF LETTERS OF CREDIT. The expiration date of each Letter of
Credit shall be on a date which is not later than the earlier of (a) one year
from its date of issuance or (b) the tenth (10th) day prior to the date set
forth in clause (a) of the definition of the term Commitment Termination Date.
Notwithstanding the foregoing, a Letter of Credit may provide for automatic
extensions of its expiration date for one (1) or more successive one (1) year
periods provided that upon not less than 30 days written notice to Borrower, the
L/C Issuer has the right to terminate such Letter of Credit on each such annual
expiration date and no renewal term may extend the term of the Letter of Credit
to a date that is later than the tenth (10th) day prior to the date set forth in
clause (a) of the definition of the term Commitment Termination Date. The L/C
Issuer may elect not to renew any such Letter of Credit and, upon direction by
Agent or Requisite Revolving Lenders, shall not renew any such Letter of Credit
at any time during the continuance of an Event of Default, provided that, in the
case of a direction by Agent or Requisite Revolving Lenders, the L/C Issuer
receives such directions prior to the date notice of non-renewal is required to
be given by the L/C Issuer and the L/C Issuer has had a reasonable period of
time to act on such notice.
OBLIGATIONS ABSOLUTE. The obligation of Borrower to reimburse the L/C Issuer,
Agent and Lenders for payments made in respect of Letters of Credit issued by
the L/C Issuer shall be unconditional and irrevocable and shall be paid under
all circumstances strictly in accordance with the terms of this Agreement,
including the following circumstances: (a) any lack of validity or
enforceability of any Letter of Credit; (b) any amendment or waiver of or any
consent or departure from all or any of the provisions of any Letter of Credit
or any Loan Document; (c) the existence of any claim, set-off, defense or other
right which Borrower, any of its Subsidiaries or Affiliates or any other Person
may at any time have against any beneficiary of any Letter of Credit, Agent, any
L/C Issuer, any Lender or any other Person, whether in connection with this
Agreement, any other Loan Document or any other related or unrelated agreements
or transactions; (d) any draft or other document presented under any Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect
or any statement therein being untrue or inaccurate in any respect; (e) payment
under any Letter of Credit against presentation of a draft or other document
that does not substantially comply with the terms of such Letter of Credit; or
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(f) any other act or omission to act or delay of any kind of any L/C Issuer,
Agent, any Lender or any other Person or any other event or circumstance
whatsoever that might, but for the provisions of this SECTION 1.1(D)(V),
constitute a legal or equitable discharge of Borrower's obligations hereunder.
Without limiting the generality of the foregoing, it is expressly understood and
agreed by Borrower that the absolute and unconditional obligation of Borrower to
Agent and Lenders hereunder to reimburse payments made under a Letter of Credit
will not be excused by the gross negligence or willful misconduct of the L/C
Issuer. However, the foregoing shall not be construed to excuse an L/C Issuer
from claims which Borrower may assert against the L/C Issuer subject to the
terms of the Master Standby Agreement or the Master Documentary Agreement.
OBLIGATIONS OF L/C ISSUERS. Each L/C Issuer (other than GE Capital) hereby
agrees that it will not issue a Letter of Credit hereunder until it has provided
Agent with written notice specifying the amount and intended issuance date of
such Letter of Credit and Agent has returned a written acknowledgment of such
notice to L/C Issuer (such notices and acknowledgements to be given promptly).
Each L/C Issuer (other than GE Capital) further agrees to provide to Agent: (a)
a copy of each Letter of Credit issued by such L/C Issuer promptly after its
issuance; (b) a weekly report summarizing available amounts under Letters of
Credit issued by such L/C Issuer, the dates and amounts of any draws under such
Letters of Credit, the effective date of any increase or decrease in the face
amount of any Letters of Credit during such week and the amount of any
unreimbursed draws under such Letters of Credit; and (c) such additional
information reasonably requested by Agent from time to time with respect to the
Letters of Credit issued by such L/C Issuer.
Swap Related Reimbursement Obligations.
---------------------------------------
Borrower agrees to reimburse GE Capital in immediately available funds in the
amount of any payment made by GE Capital under a Swap Related L/C (such
reimbursement obligation, whether contingent upon payment by GE Capital under
the Swap Related L/C or otherwise, being herein called a "SWAP RELATED
REIMBURSEMENT OBLIGATION"). No Swap Related Reimbursement Obligation for any
Swap Related L/C may exceed the amount of the payment obligations owed by
Borrower under the interest rate protection or hedging agreement or transaction
supported by the Swap Related L/C.
A Swap Related Reimbursement Obligation shall be due and payable by Borrower
within one (1) Business Day after the date on which the related payment is made
by GE Capital under the Swap Related L/C.
Any Swap Related Reimbursement Obligation shall, during the period in which it
is unpaid, bear interest at the rate per annum equal to the LIBOR Rate plus one
percent (1%), as if the unpaid amount of the Swap Related Reimbursement
Obligation were a LIBOR Loan, and not at any otherwise applicable Default Rate.
Such interest shall be payable upon demand. The following additional provisions
apply to the calculation and charging of interest by reference to the LIBOR
Rate:
7
(A) The LIBOR Rate shall be determined for each successive
one-month LIBOR Period during which the Swap Related Reimbursement
Obligation is unpaid, notwithstanding the occurrence of any Event of
Default and even if the LIBOR Period were to extend beyond the
Commitment Termination Date.
(B) If a Swap Related Reimbursement Obligation is paid during
a monthly period for which the LIBOR Rate is determined, interest shall
be pro-rated and charged for the portion of the monthly period during
which the Swap Related Reimbursement Obligation was unpaid. SECTION
1.2(D) shall not apply to any payment of a Swap Related Reimbursement
Obligation during the monthly period.
(C) Notwithstanding the last sentence of the definition of
"LIBOR Rate", with respect to Swap Related Reimbursement Obligations if
the LIBOR Rate is no longer available from Telerate News Service, the
LIBOR Rate shall be determined by GE Capital from such financial
reporting service or other information available to GE Capital as in GE
Capital's reasonable discretion indicates GE Capital's cost of funds.
Except as provided in the foregoing provisions of this SECTION 1.1(E) and in
SECTION 1.3(E), Borrower shall not be obligated to pay to GE Capital or any of
its Affiliates any Letter of Credit Fee, or any other fees, charges or expenses,
in respect of a Swap Related L/C or arranging for any interest rate protection
or hedging agreement or transaction supported by the Swap Related L/C. GE
Capital and its Affiliates shall look to the beneficiary of a Swap Related L/C
for payment of any such letter of credit fees or other fees, charges or expenses
and such beneficiary may factor such fees, charges, or expenses into the pricing
of any interest rate protection or hedging arrangement or transaction supported
by the Swap Related L/C.
If any Swap Related L/C is revocable prior to its scheduled expiry date, GE
Capital agrees not to cause or permit the Swap Related L/C to be revoked unless
the Commitment Termination Date or an Event of Default has occurred.
GE Capital or any of its Affiliates shall be permitted to (i) provide
confidential or other information furnished to it by any of the Credit Parties
(including, without limitation, copies of any documents and information in or
referred to in the Closing Checklist, Financial Statements and Compliance
Certificates) to a beneficiary or potential beneficiary of a Swap Related L/C
and (ii) receive confidential or other information from the beneficiary or
potential beneficiary relating to any agreement or transaction supported or to
be supported by the Swap Related L/C. However, no confidential information shall
be provided to any Person under this paragraph unless the Person has agreed to
comply with the covenant substantially as contained in SECTION 9.13 of this
Agreement.
FUNDING AUTHORIZATION. The proceeds of all Loans made pursuant to this Agreement
subsequent to the Closing Date are to be funded by Agent by wire transfer to the
account designated by Borrower below (the "DISBURSEMENT Account"):
8
Bank:
------------------------------------
ABA No.:
------------------------------------
Bank Address:
------------------------------------
Account No.:
------------------------------------
Reference:
------------------------------------
Borrower shall provide Agent with written notice of any change in the foregoing
instructions at least three (3) Business Days before the desired effective date
of such change.
INTEREST AND APPLICABLE MARGINS.
--------------------------------
Borrower shall pay interest to Agent, for the ratable benefit of Lenders with
respect to the various Loans made by each Lender (or in the case of the Swing
Line Loan, for the benefit of the Swing Line Lender), in arrears on each
applicable Interest Payment Date, at the following rates: (i) with respect to
the Revolving Credit Advances which are designated as Index Rate Loans (and for
all other Obligations not otherwise set forth below), the Index Rate plus the
Applicable Revolver Index Margin per annum or, with respect to Revolving Credit
Advances which are designated as LIBOR Loans, at the election of Borrower, the
applicable LIBOR Rate plus the Applicable Revolver LIBOR Margin per annum; (ii)
with respect to such portion of the Term Loan B designated as an Index Rate
Loan, the Index Rate plus the Applicable Term Loan B Index Margin per annum or,
with respect to such portion of the Term Loan B designated as a LIBOR Loan, the
applicable LIBOR Rate plus the Applicable Term Loan B LIBOR Margin per annum;
and (iii) with respect to the Swing Line Loan, the Index Rate plus the
Applicable Revolver Index Margin per annum.
The Applicable Margins are as follows:
Applicable Revolver Index Margin 2.50%
Applicable Revolver LIBOR Margin 4.00%
Applicable Term Loan B Index Margin 2.50%
Applicable Term Loan B LIBOR Margin 4.00%
Applicable L/C Margin 4.00%
Applicable Unused Line Fee Margin 0.50%
If any payment on any Loan becomes due and payable on a day other than a
Business Day, the maturity thereof will be extended to the next succeeding
Business Day (except as set forth in the definition of LIBOR Period) and, with
respect to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension.
All computations of Fees calculated on a per annum basis and interest shall be
made by Agent on the basis of a 360-day year, in each case for the actual number
of days occurring in the period for which such Fees and interest are payable.
The Index Rate is a floating rate determined for each day. Each determination by
Agent of an interest rate and Fees hereunder shall be presumptive evidence of
the correctness of such rates and Fees.
9
So long as an Event of Default has occurred and is continuing under SECTION
7.1(A), (F) or (G) and without notice of any kind, or so long as any other Event
of Default has occurred and is continuing and at the election of Agent (or upon
the written request of Requisite Lenders) confirmed by written notice from Agent
to Borrower, the interest rates applicable to the Loans and the Letter of Credit
Fee shall be increased by two percentage points (2%) per annum above the rates
of interest or the rate of such Fee otherwise applicable hereunder ("DEFAULT
Rate"), and the outstanding principal balance of the Loans shall bear interest
at the Default Rate applicable to such Obligations. Interest and Letter of
Credit Fees at the Default Rate shall accrue from the initial date of such Event
of Default until that Event of Default is cured or waived and shall be payable
upon demand, but in any event, shall be payable on the next regularly scheduled
payment date set forth herein for such Obligation.
Borrower shall have the option to (i) request that any Revolving Credit Advance
be made as a LIBOR Loan, (ii) convert at any time all or any part of outstanding
Loans (other than the Swing Line Loan) from Index Rate Loans to LIBOR Loans,
(iii) convert any LIBOR Loan to an Index Rate Loan, subject to payment of the
LIBOR Breakage Costs in accordance with SECTION 1.3(D) if such conversion is
made prior to the expiration of the LIBOR Period applicable thereto, or (iv)
continue all or any portion of any Loan (other than the Swing Line Loan) as a
LIBOR Loan upon the expiration of the applicable LIBOR Period and the succeeding
LIBOR Period of that continued Loan shall commence on the first day after the
last day of the LIBOR Period of the Loan to be continued. Any Loan or group of
Loans having the same proposed LIBOR Period to be made or continued as, or
converted into, a LIBOR Loan must be in a minimum amount of $5,000,000 and
integral multiples of $500,000 in excess of such amount. Any such election must
be made by 1:00 p.m. (New York time) on the 3rd Business Day prior to (1) the
date of any proposed Revolving Credit Advance which is to bear interest at the
LIBOR Rate, (2) the end of each LIBOR Period with respect to any LIBOR Loans to
be continued as such, or (3) the date on which Borrower wishes to convert any
Index Rate Loan to a LIBOR Loan for a LIBOR Period designated by Borrower in
such election. If no election is received with respect to a LIBOR Loan by 1:00
p.m. (New York time) on the 3rd Business Day prior to the end of the LIBOR
Period with respect thereto, that LIBOR Loan shall be converted to an Index Rate
Loan at the end of its LIBOR Period. Borrower must make such election by notice
to Agent in writing, by fax or overnight courier (or by telephone, to be
confirmed in writing on such day). In the case of any conversion or
continuation, such election must be made pursuant to a written notice (a "NOTICE
OF CONVERSION/CONTINUATION") in the form of EXHIBIT 1.2(E). No Loan shall be
made, converted into or continued as a LIBOR Loan, if an Event of Default has
occurred and is continuing and Agent or Requisite Lenders have determined not to
make or continue any Loan as a LIBOR Loan as a result thereof. No Loan may be
made as or converted into a LIBOR Loan until the earlier of (i) 45 days after
the Closing Date or (ii) completion of the primary syndication as determined by
Agent.
Notwithstanding anything to the contrary set forth in this SECTION 1.2, if a
court of competent jurisdiction determines in a final order that the rate of
interest payable hereunder exceeds the highest rate of interest permissible
under law (the "MAXIMUM LAWFUL RATE"), then so long as the Maximum Lawful Rate
would be so exceeded, the rate of interest payable hereunder shall be equal to
the Maximum Lawful Rate; provided, however, that if at any time thereafter the
rate of interest payable hereunder is less than the Maximum Lawful Rate,
Borrower shall continue to pay interest hereunder at the Maximum Lawful Rate
10
until such time as the total interest received by Agent, on behalf of Lenders,
is equal to the total interest that would have been received had the interest
rate payable hereunder been (but for the operation of this paragraph) the
interest rate payable since the Closing Date as otherwise provided in this
Agreement. Thereafter, interest hereunder shall be paid at the rate(s) of
interest and in the manner provided in SECTIONS 1.2(A) through (E), unless and
until the rate of interest again exceeds the Maximum Lawful Rate, and at that
time this paragraph shall again apply. In no event shall the total interest
received by any Lender pursuant to the terms hereof exceed the amount that such
Lender could lawfully have received had the interest due hereunder been
calculated for the full term hereof at the Maximum Lawful Rate. If the Maximum
Lawful Rate is calculated pursuant to this paragraph, such interest shall be
calculated at a daily rate equal to the Maximum Lawful Rate divided by the
number of days in the year in which such calculation is made. If,
notwithstanding the provisions of this SECTION 1.2(F), a court of competent
jurisdiction shall determine by a final, non-appealable order that a Lender has
received interest hereunder in excess of the Maximum Lawful Rate, Agent shall,
to the extent permitted by applicable law, promptly apply such excess as
specified in SECTION 1.5(E) and thereafter shall refund any excess to Borrower
or as such court of competent jurisdiction may otherwise order.
FEES.
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FEE LETTER. Borrower shall pay to GE Capital, individually, the Fees specified
in that certain fee letter dated as of January 30, 2006 among Borrower and GE
Capital (the "GE CAPITAL FEE LETTER"), at the times specified for payment
therein.
UNUSED LINE FEE. As additional compensation for the Revolving Lenders, Borrower
shall pay to Agent, for the ratable benefit of such Lenders, in arrears, on the
first Business Day of each month prior to the Commitment Termination Date and on
the Commitment Termination Date, a fee for Borrower's non-use of available funds
in an amount equal to the Applicable Unused Line Fee Margin per annum multiplied
by the difference between (x) the Maximum Amount (as it may be reduced from time
to time) and (y) the average for the period of the daily closing balances of the
Revolving Loan (including, without duplication, Swing Line Loans) outstanding
during the period for which such Fee is due.
LETTER OF CREDIT FEE. Borrower agrees to pay to Agent for the benefit of
Revolving Lenders, as compensation to such Revolving Lenders for Letter of
Credit Obligations incurred hereunder, (i) without duplication of costs and
expenses otherwise payable to Agent or Lenders hereunder, all reasonable costs
and expenses, without duplication of fees otherwise paid by Borrower, incurred
by Agent or any Lender on account of such Letter of Credit Obligations, and (ii)
for each month during which any Letter of Credit Obligation shall remain
outstanding, a fee (the "LETTER OF CREDIT FEE") in an amount equal to the
product of the average daily undrawn face amount of all Letters of Credit
issued, guaranteed or supported by risk participation agreements multiplied by a
per annum rate equal to the Applicable L/C Margin from time to time in effect.
Such fee shall be paid to Agent for the benefit of the Revolving Lenders in
arrears, on the first Business Day of each month and on the Commitment
Termination Date. In addition, Borrower shall pay to any L/C Issuer, on demand,
such reasonable fees, without duplication of fees otherwise payable hereunder
(including all per annum fees), charges and expenses of such L/C Issuer in
11
respect of the issuance, negotiation, acceptance, amendment, transfer and
payment of such Letter of Credit or otherwise payable pursuant to the
application and related documentation under which such Letter of Credit is
issued.
LIBOR BREAKAGE COSTS. Upon (i) any default by Borrower in making any borrowing
of, conversion into or continuation of any LIBOR Loan following Borrower's
delivery to Agent of any LIBOR Loan request in respect thereof or (ii) any
payment of a LIBOR Loan on any day that is not the last day of the LIBOR Period
applicable thereto (regardless of the source of such prepayment and whether
voluntary, by acceleration or otherwise), Borrower shall pay Agent, for the
benefit of all Lenders that funded or were prepared to fund any such LIBOR Loan,
LIBOR Breakage Costs, if applicable.
EXPENSES AND ATTORNEYS' FEES. Borrower agrees to pay all reasonable,
out-of-pocket fees, charges, costs and expenses (including reasonable attorneys'
fees and expenses) incurred by Agent in connection with any matters contemplated
by or arising out of the Loan Documents, in connection with the examination,
review, due diligence investigation, documentation, negotiation, closing and
syndication of the transactions contemplated herein and in connection with the
continued administration of the Loan Documents including any amendments,
modifications, consents and waivers. Borrower agrees to promptly pay all
reasonable, out-of-pocket fees, charges, costs and expenses (including fees,
charges, costs and expenses of attorneys, auditors, appraisers, consultants and
advisors) incurred by Agent in connection with any amendment, waiver, consent
with respect to the Loan Documents, Event of Default, work-out or action to
enforce any Loan Document or to collect any payments due from Borrower or any
other Credit Party. In addition, in connection with any work-out or action to
enforce any Loan Document or to collect any payments due from Borrower or any
other Credit Party, Borrower agrees to promptly pay all reasonable fees,
charges, costs and expenses, including, without limitation, reasonable
attorneys' fees, incurred by Lenders. All fees, charges, costs and expenses for
which Borrower is responsible under this SECTION 1.3(E) shall be deemed part of
the Obligations when incurred, payable in accordance with the penultimate
sentence of SECTION 1.4 and secured by the Collateral.
PAYMENTS. All payments by Borrower of the Obligations shall be without
deduction, defense, setoff or counterclaim and shall be made in same day funds
and delivered to Agent, for the benefit of Agent and Lenders, as applicable, by
wire transfer to the account identified on ANNEX E such other place as Agent may
from time to time designate in writing.
Borrower shall receive credit on the day of receipt for funds received
by Agent by 2:00 p.m. (New York time). In the absence of timely receipt, such
funds shall be deemed to have been paid on the next Business Day. Whenever any
payment to be made hereunder shall be stated to be due on a day that is not a
Business Day, the payment may be made on the next succeeding Business Day and
such extension of time shall be included in the computation of the amount of
interest and Fees due hereunder.
Borrower hereby authorizes Lenders to make Revolving Credit Advances or
Swing Line Advances for the payment of Scheduled Installments, interest, Fees
and expenses, Letter of Credit reimbursement obligations and any amounts
required to be deposited with respect to outstanding Letter of Credit
Obligations pursuant to SECTIONS 1.5(F) OR 7.3; provided, that so long as no
12
Event of Default has occurred and is continuing, expense reimbursements pursuant
to SECTION 1.3(E) shall be payable 10 days after notice thereof to Borrower (and
otherwise such expense reimbursements shall be payable upon demand).
PREPAYMENTS.
------------
VOLUNTARY PREPAYMENTS OF LOANS. At any time, Borrower may prepay the Loans, in
whole or in part, without premium or penalty subject to the payment of LIBOR
Breakage Costs, if applicable. Prepayments of Term Loan B shall be applied in
accordance with SECTION 1.5(E).
PREPAYMENTS FROM EXCESS CASH FLOW. Within one hundred (100) days after the end
of each Fiscal Year commencing with the Fiscal Year ended October 31, 2006,
Borrower shall prepay the Loans in an amount equal to seventy-five percent (75%)
of the Excess Cash Flow for such Fiscal Year (PROVIDED, however, that for Fiscal
Year 2006, Borrower shall prepay the Loans in an amount equal to seventy-five
percent (75%) of the Excess Cash Flow for the period beginning on the Closing
Date and ending on October 31, 2006). The calculation shall be based on the
audited Financial Statements for Holdings and its Subsidiaries. Any prepayments
from Excess Cash Flow paid pursuant to this SECTION 1.5(B) shall be applied in
accordance with SECTION 1.5(E).
PREPAYMENTS FROM ASSET DISPOSITIONS. Immediately upon receipt of any Net
Proceeds in excess of $500,000 in the aggregate during any Fiscal Year, Borrower
shall prepay the Loans in an amount equal to such Net Proceeds, except that
Borrower or its Subsidiaries may reinvest all Net Proceeds of any such Asset
Disposition, within one hundred eighty (180) days, in fixed assets. If Borrower
does not intend to so reinvest such Net Proceeds or if the period set forth in
the immediately preceding sentence expires without Borrower having reinvested
the Net Proceeds of any such Asset Disposition, Borrower shall prepay the Loans
in an amount equal to such remaining Net Proceeds in accordance with SECTION
1.5(E).
PREPAYMENTS FROM ISSUANCE OF SECURITIES. Immediately upon the receipt by
Holdings, Borrower or any of its Subsidiaries of the proceeds of the issuance of
Stock, Borrower shall prepay the Loans in an amount equal to such proceeds, net
of underwriting discounts and commissions and other reasonable out-of-pocket
costs associated therewith. The payments shall be applied in accordance with
SECTION 1.5(E). Notwithstanding the foregoing, the following proceeds of stock
issuance shall be excluded from any mandatory prepayment: (i) proceeds of
issuances of Stock by Holdings or Borrower on or prior to the Closing Date, (ii)
proceeds of issuances of Stock of Holdings (and options and warrants for the
issuance of Stock of Holdings) to employees and directors of Holdings, Borrower
or ▇▇▇▇▇▇▇ and proceeds from the exercise of options and warrants by employees
and directors and (iii) proceeds of issuances of Stock by any Subsidiary of
Borrower to Borrower which constitutes an Investment permitted hereunder.
APPLICATION OF PROCEEDS. With respect to any prepayments made by Borrower
pursuant to SECTIONS 1.5(B), 1.5(C) and SECTION 1.5(D) and any payments of Term
Loan B pursuant to SECTION 1.5(A), such prepayments shall be applied as follows:
first, in payment of the Term Loan B in the inverse order of maturity of the
Scheduled Installments until the Term Loan B shall have been prepaid in full;
second, to any unpaid Swap Related Reimbursement Obligations and Obligations
then due and owing with respect to Interest Rate Agreements, ratably to the
aggregate combined balance of the unpaid Swap Related Reimbursement Obligations
and Obligations then due and owing with respect to Interest Rate Agreements;
third to reduce the outstanding principal balance of the Swing Line Loan
13
outstanding to Borrower until the same has been repaid in full; and fourth, to
the Revolving Credit Advances outstanding to Borrower until the same has been
repaid in full with a corresponding permanent reduction of the Revolving Loan
Commitment. Considering each type of Loan being prepaid separately, any such
prepayment shall be applied first to Index Rate Loans of the type required to be
prepaid before application to LIBOR Loans of the type required to be prepaid, in
each case in a manner which minimizes any resulting LIBOR Breakage Costs.
LETTER OF CREDIT OBLIGATIONS. In the event any Letters of Credit are outstanding
at the time that the Revolving Loan Commitment is terminated, Borrower shall
deposit with Agent for the benefit of all Revolving Lenders cash in an amount
equal to 105% of the aggregate outstanding Letter of Credit Obligations to be
available to Agent to reimburse payments of drafts drawn under such Letters of
Credit and pay any Fees and expenses related thereto.
MATURITY. All of the Obligations shall become due and payable as otherwise set
forth herein, but in any event all of the remaining Obligations shall become due
and payable upon the Commitment Termination Date. Until the Termination Date,
Agent shall be entitled to retain the Liens on the Collateral granted under the
Collateral Documents and the ability to exercise all rights and remedies
available to them under the Loan Documents and applicable laws. Notwithstanding
anything contained in this Agreement to the contrary, upon any termination of
the Revolving Loan Commitment, all of the Obligations (other than contingent
indemnification obligations as to which no claim has been asserted) shall be due
and payable.
LOAN ACCOUNTS. Agent shall maintain a loan account (the "LOAN ACCOUNT") on its
books to record: the name and federal employer identification number of each
Lender, all Advances and the Term Loan B, all payments made by Borrower, and all
other debits and credits as provided in this Agreement with respect to the Loans
or any other Obligations. All entries in the Loan Account shall be made in
accordance with Agent's customary accounting practices as in effect from time to
time. The balance in the Loan Account, as recorded on Agent's most recent
printout or other written statement, shall, absent manifest error, be
presumptive evidence of the amounts due and owing to Agent and Lenders by
Borrower; PROVIDED that any failure to so record or any error in so recording
shall not limit or otherwise affect (other than to the extent of such error)
Borrower's duty to pay the Obligations. Agent shall render to Borrower a monthly
accounting of transactions with respect to the Loans setting forth the balance
of the Loan Account for the immediately preceding month. Unless Borrower
notifies Agent in writing of any objection to any such accounting (specifically
describing the basis for such objection), within forty-five (45) days after the
date thereof, each and every such accounting shall, absent manifest error, be
presumptive evidence of all matters reflected therein. Only those items
expressly objected to in such notice shall be deemed to be disputed by Borrower.
Notwithstanding any provision herein contained to the contrary, any Lender may
elect (which election may be revoked) to dispense with the issuance of Notes to
that Lender and may rely on the Loan Account as evidence of the amount of
Obligations from time to time owing to it.
YIELD PROTECTION.
-----------------
CAPITAL ADEQUACY AND OTHER ADJUSTMENTS. In the event that any Lender shall have
determined that the adoption after the date hereof of any law, treaty,
governmental (or quasi-governmental) rule, regulation, guideline or order
regarding capital adequacy, reserve requirements or similar requirements or
14
compliance by any Lender or any corporation controlling such Lender with any
request or directive regarding capital adequacy, reserve requirements or similar
requirements (whether or not having the force of law and whether or not failure
to comply therewith would be unlawful) from any central bank or governmental
agency or body having jurisdiction does or shall have the effect of increasing
the amount of capital, reserves or other funds required to be maintained by such
Lender or any corporation controlling such Lender and thereby reducing the rate
of return on such Lender's or such corporation's capital as a consequence of its
obligations hereunder, then Borrower shall from time to time within fifteen (15)
days after notice and demand from such Lender (together with the certificate
referred to in the next sentence and with a copy to Agent) pay to Agent, for the
account of such Lender, additional amounts sufficient to compensate such Lender
for such reduction; provided that if the respective Lender has unreasonably
delayed or withheld such notice and demand, the respective Lender shall not be
entitled to receive additional payments pursuant to this Section 1.8(a) for
periods occurring prior to the 180th day before the receipt of such notice and
demand. A certificate as to the amount of such cost and showing the basis of the
computation of such cost submitted by such Lender to Borrower and Agent shall be
presumptive evidence of the matters set forth therein.
INCREASED LIBOR FUNDING COSTS; ILLEGALITY. Notwithstanding anything to the
contrary contained herein, if the introduction of or any change in any law,
rule, regulation, treaty or directive (or any change in the interpretation
thereof) after the date hereof shall make it unlawful, or any central bank or
other Governmental Authority shall assert that it is unlawful, for any Lender to
agree to make or to make or to continue to fund or maintain any LIBOR Loan,
then, unless that Lender is able to make or to continue to fund or to maintain
such LIBOR Loan at another branch or office of that Lender without, in that
Lender's opinion, adversely affecting it or its Loans or the income obtained
therefrom, on notice thereof and demand therefor by such Lender to Borrower
through Agent, (i) the obligation of such Lender to agree to make or to make or
to continue to fund or maintain LIBOR Loans shall terminate and (ii) Borrower
shall forthwith prepay in full each such outstanding LIBOR Loans owing to such
Lender, together with interest accrued thereon, unless Borrower, within five (5)
Business Days after the delivery of such notice and demand, converts all LIBOR
Loans into Index Rate Loans. If, after the date hereof, the introduction of,
change in or interpretation of any law, rule, regulation, treaty or directive
would impose or increase reserve requirements (other than as taken into account
in the definition of LIBOR) and the result of any of the foregoing is to
increase the cost to Agent or any such Lender of issuing any Letter of Credit or
making or continuing any Loan hereunder, as the case may be, or to reduce any
amount receivable hereunder, then Borrower shall from time to time within
fifteen (15) days after notice and demand from Agent (together with the
certificate referred to in the next sentence) pay to Agent for the account of
all such affected Lenders additional amounts sufficient to compensate such
Lenders for such increased cost; provided that Borrower shall not be liable to
pay for any such amounts incurred or accrued more than one hundred eighty (180)
days prior to the date on which notice of the event giving rise to the
obligation to make such payment is given to Borrower, and provided further, that
such Lender shall not be entitled to any such additional amounts unless such
Lender is imposing similar types of assessments on other similarly situated
borrowers. A certificate as to the amount of such cost and showing the basis of
the computation of such cost submitted by Agent on behalf of all such affected
Lenders to Borrower shall be presumptive evidence of the matters set forth
therein.
15
TAXES.
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NO DEDUCTIONS; OTHER TAXES. Any and all payments or reimbursements made
hereunder or under any other Loan Documents shall be made free and clear of and
without deduction for any and all Charges, present or future, taxes, levies,
imposts, deductions or withholdings, and all liabilities with respect thereto
(including any interest, additions to tax or penalties applicable thereto) of
any nature whatsoever imposed by any Governmental Authority ("TAXES"), excluding
(a) such Taxes to the extent imposed on or measured by Agent's or a Lender's net
income (and franchise taxes, branch profits taxes, taxes on doing business or
other taxes imposed in lieu thereof) as a result of a connection between such
Agent or Lender and the jurisdiction of the Governmental Authority imposing such
Tax or any political subdivision or taxing authority thereof or therein (other
than any such connection that would not have arisen but for such Agent or Lender
having executed, delivered, performed its obligations or received a payment
under, or enforced, this Agreement or any other Loan Document) and (b) any
United States federal withholding tax that is imposed on amounts payable to a
Foreign Lender at the time such Foreign Lender becomes a party to this Agreement
or is attributable to such Foreign Lender's failure (other than as a result of a
change in law, rule, regulation or treaty or in the administration,
interpretation or application thereof by any Governmental Authority) to comply
with SECTION 1.9(C), except to the extent that such Foreign Lender's assignor
(if any) was entitled, at the time of assignment, to receive additional amounts
from the Borrower with respect to such withholding tax pursuant to this SECTION
1.9(A) (collectively, "EXCLUDED Taxes," and all such non-Excluded Taxes being
referred to herein as "NON-EXCLUDED TAXES"). If Borrower shall be required by
law to deduct any Non-Excluded Taxes or Other Taxes from or in respect of any
sum payable hereunder or under any other Loan Document to any Lender or Agent,
then the sum payable hereunder shall be increased as may be necessary so that,
after making all required deductions (including deductions applicable to
additional sums payable pursuant to this SECTION 1.9), such Lender or Agent
receives an amount equal to the sum it would have received had no such
deductions been made. If any amounts are payable in respect of Non-Excluded
Taxes or Other Taxes pursuant to the preceding sentence, Borrower agrees to
reimburse each Lender or Agent, upon the written request of such Lender or Agent
and reasonable documentation of such amounts, for any net additional taxes
imposed on or measured by the net income of such Lender or Agent as such Lender
or Agent shall determine are payable in respect of such amounts so paid to or on
behalf of such Lender or Agent pursuant to the preceding sentence and in respect
of any amounts paid to or on behalf of such Lender or Agent pursuant to this
sentence. All required deductions shall be withheld and timely paid over to the
relevant Governmental Authority in accordance with applicable law. In addition,
Borrower agrees to timely pay to the relevant Governmental Authority in
accordance with applicable law any present or future stamp or documentary taxes
or any other excise or property taxes, charges or similar levies which arise
from any payment made hereunder or under any other Loan Document or from the
execution, delivery, enforcement or registration of, or otherwise with respect
to, this Agreement or any other Loan Document ("OTHER TAXES").
CHANGES IN TAX LAWS. In the event that, after the date hereof (or in the case of
an assignee or participant, the date of the relevant assignment or sale of a
participation), (1) any changes in any existing law, regulation, treaty or
directive or in the administration, interpretation or application thereof, (2)
any new law, regulation, treaty or directive enacted or any administration,
interpretation or application thereof, or (3) compliance with any request,
guideline or directive (whether or not having the force of law) from any
Governmental Authority:
16
does or shall subject Agent or any Lender to any tax of any kind whatsoever with
respect to this Agreement, or any other Loan Documents or any Loans made or
Letters of Credit issued hereunder, or change the basis of taxation of payments
to Agent or such Lender in respect thereof (except for the imposition of, or any
change in the rate of, any Excluded Tax); or
does or shall impose on Agent or any Lender any other condition, cost or expense
in connection with the transactions contemplated hereby or participations
herein; and the result of any of the foregoing is to increase the cost to Agent
or any such Lender of issuing or maintaining any Letter of Credit or making or
continuing any Loan hereunder, as the case may be, or to reduce any amount
receivable hereunder or under any other Loan Document, then, in any such case,
Borrower shall promptly pay to Agent or such Lender, upon its demand with
reasonable documentation thereof, any additional amounts necessary to compensate
Agent or such Lender, on an after-tax basis, for such additional cost or reduced
amount receivable, as reasonably determined by Agent or such Lender; provided
that Agent or such Lender shall not be entitled to any such amounts to the
extent that the event giving rise to such additional cost or reduced amount
receivable occurred more than 180 days prior to the date such notice and demand
is given to the Borrower; provided, however, that if the event giving rise to
such additional cost or reduced amount receivable has a retroactive effect, then
such 180-day period shall be extended to include the period of such retroactive
effect. If Agent or such Lender becomes aware that it is entitled to claim any
additional amounts pursuant to this SECTION 1.9(B), it shall promptly notify
Borrower of the event by reason of which Agent or such Lender has become so
entitled. A certificate as to any additional amounts payable pursuant to the
foregoing sentence submitted by Agent or such Lender to Borrower (with a copy to
Agent if applicable) shall be presumptive evidence of the amount due. Borrower
shall be presumptive evidence of the amount due. Borrower shall pay Agent or
such Lender, as the case may be, the amount shown as due on any such certificate
within ten (10) days after the receipt thereof.
FOREIGN LENDERS. Prior to becoming a Lender under this Agreement and within
fifteen (15) days after a reasonable written request of Borrower or Agent from
time to time thereafter, each such Person or Lender that is not in each case a
"United States person" (as such term is defined in IRC Section 7701(a)(30)) for
U.S. federal income tax purposes (a "FOREIGN LENDER") shall provide to Borrower
and Agent, if it is legally entitled to, a properly completed and executed IRS
Form W-8BEN or Form W-8ECI or other applicable form, certificate or document
prescribed by the IRS, certifying as to such Foreign Lender's entitlement to an
exemption from, or reduction in, United States withholding tax with respect to
payments to be made to such Foreign Lender under this Agreement and under the
Notes (a "CERTIFICATE OF EXEMPTION").
INDEMNIFICATION. Borrower will indemnify each Lender and Agent for the full
amount of Non-Excluded Taxes and Other Taxes (including any Non-Excluded Taxes
and Other Taxes imposed by any jurisdiction on amounts payable under this
SECTION 1.9) paid by such Lender or Agent, as the case may be, and any liability
(including penalties, interest and expenses including reasonable attorney's fees
and expenses) arising therefrom or with respect thereto, whether or not such
Non-Excluded Taxes or Other Taxes were correctly or legally asserted by the
relevant Governmental Authority. A certificate as to the amount of such payments
or liabilities submitted by Lender or Agent to Borrower (with a copy to Agent if
applicable) shall be presumptive evidence of the amount due. Borrower shall pay
Agent or such Lender, as the case may be, the amount shown as due on any such
certificate within ten (10) day s after the receipt thereof.
17
EVIDENCE OF PAYMENTS. As soon as practicable after any payment of Non-Excluded
Taxes or Other Taxes by the Borrower to a Governmental Authority, the Borrower
shall deliver to the Agent the original or a certified copy of a receipt issued
by such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Agent.
CONDITIONS TO LOANS
The obligations of Lenders and L/C Issuers to make Loans and to issue
or cause to be issued Letters of Credit are subject to satisfaction of all of
the applicable conditions set forth below.
CONDITIONS TO INITIAL LOANS. The obligations of Lenders and L/C Issuers to make
the initial Loans and to issue or cause to be issued Letters of Credit on the
Closing Date are, in addition to the conditions precedent specified in SECTION
2.2, subject to
the Second Lien Loans shall have been, or shall reasonably concurrently be,
fully funded in an aggregate principal amount not to exceed $60,000,000. The
terms and conditions of the Second Lien Loans shall be reasonably satisfactory
in form and substance to the Agent and each Lender;
EBITDA of Holdings and its Subsidiaries for the trailing twelve Fiscal Month
period ending January 31, 2006 (including adjustments, if any, reasonably
satisfactory to the Agent) shall have been at least $35,500,000;
the Leverage Ratio as of January 31, 2006 based upon EBITDA for the trailing
twelve Fiscal Month period ending on such date, determined on a pro forma basis
after giving effect to the Loans and the Related Transactions, shall not exceed
4.90:1;
the Senior Leverage Ratio as of January 31, 2006 based upon EBITDA for the
trailing twelve Fiscal Month period ending on such date, determined on a pro
forma basis after giving effect to the Loans and the Related Transactions, shall
not exceed 2.80:1;
total Funded Debt of Holdings and its Subsidiaries on a consolidated basis after
giving pro forma effect to the Loans and Related Transactions shall not exceed
$173,000,000;
Agent shall have received, in form and substance reasonably satisfactory to it,
evidence that the Loans have been rated not less than (i) B3 from ▇▇▇▇▇'▇
Investors Service, Inc. and (ii) B from Standard & Poor's Ratings Group, a
division of the McGraw Hill Companies, Inc.;
Agent shall have received copies of employment agreements between Borrower and
each of Dr. ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇ ▇▇▇▇▇▇▇, each of which shall be
in form and substance reasonably satisfactory to Agent and Lenders;
Agent has received evidence, in form and substance reasonably satisfactory to
it, that Borrower has obtained a key man life insurance policy, naming Agent as
assignee, in the amount of $5,000,000 for Dr. ▇▇▇▇▇▇ ▇▇▇▇▇▇;
18
the Related Transactions shall have been consummated in accordance with their
respective terms, except as may have been consented to in writing by Agent;
Borrower shall deliver all documents listed on, take all actions set forth on
and satisfy all other conditions precedent listed in the Closing Checklist
attached hereto as ANNEX C, all in form and substance, or in a manner,
reasonably satisfactory to Agent and Lenders; and
Borrower shall have paid to the Agent all Fees required to be paid on the
Closing Date pursuant to the GE Capital Fee Letter, and shall have reimbursed
Agent for all fees, costs and expenses of closing presented as of the Closing
Date.
CONDITIONS TO ALL LOANS. Except as otherwise expressly provided herein, no
Lender or L/C Issuer shall be obligated to fund any Advance or incur any Letter
of Credit Obligation, if, as of the date thereof (the "FUNDING DATE"):
any representation or warranty by any Credit Party contained herein or in any
other Loan Document is untrue or incorrect in any material respect (without
duplication of any materiality qualifier contained therein) as of such date,
except to the extent that such representation or warranty expressly relates to
an earlier date, and Agent or Requisite Revolving Lenders have determined not to
make such Advance or incur such Letter of Credit Obligation as a result of the
fact that such warranty or representation is untrue or incorrect; any Default or
Event of Default has occurred and is continuing or would result immediately
after giving effect to any Advance (or the incurrence of any Letter of Credit
Obligation), and Agent or Requisite Revolving Lenders shall have determined not
to make any Advance or incur any Letter of Credit Obligation as a result of that
Default or Event of Default; or
after giving effect to any Advance (or the incurrence of any Letter of Credit
Obligations), the outstanding amount of the Revolving Loan would exceed
remaining Borrowing Availability (except as provided in SECTION 1.1(B)(II)).
The request and acceptance by Borrower of the proceeds of any Advance, the
incurrence of any Letter of Credit Obligations or the conversion or continuation
of any Loan into, or as, a LIBOR Loan shall be deemed to constitute, as of the
date thereof, (i) a representation and warranty by Borrower that the conditions
in this SECTION 2.2 have been satisfied and (ii) a reaffirmation by Borrower of
the granting and continuance of Agent's Liens, on behalf of itself and Lenders,
pursuant to the Collateral Documents.
REPRESENTATIONS AND WARRANTIES
To induce Agent and Lenders to enter into the Loan Documents, to make
Loans and to issue or cause to be issued Letters of Credit, Borrower and the
other Credit Parties executing this Agreement, jointly and severally, represent,
warrant and covenant to Agent and each Lender that the following statements are
and, after giving effect to the Related Transactions will remain true, correct
and complete until the Termination Date with respect to all Credit Parties.
19
ORGANIZATION, POWERS, CAPITALIZATION AND GOOD STANDING.
-------------------------------------------------------
ORGANIZATION AND POWERS. Each of the Credit Parties and each of their
Subsidiaries is duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization and qualified to do business in all
states where such qualification is required except where failure to be so
qualified or be in good standing would not reasonably be expected to have a
Material Adverse Effect. The jurisdiction of organization and all jurisdictions
in which each Credit Party is qualified to do business as of the Closing Date
are set forth on SCHEDULE 3.1(A). Each of the Credit Parties and each of their
Subsidiaries has all requisite organizational power and authority to own and
operate its properties, to carry on its business as now conducted and proposed
to be conducted, to enter into each Loan Document and Related Transactions
Document to which it is a party and to incur the Obligations, grant liens and
security interests in the Collateral and carry out the Related Transactions.
CAPITALIZATION. As of the Closing Date: (i) the authorized Stock of each of the
Credit Parties and each of their Subsidiaries is as set forth on SCHEDULE
3.1(B); (ii) all issued and outstanding Stock of each of the Credit Parties and
each of their Subsidiaries is duly authorized and validly issued, fully paid,
nonassessable (as applicable), free and clear of all Liens other than those in
favor of (A) Agent for the benefit of Agent and Lenders and (B) Second Lien
Agent for the benefit of Second Lien Agent and Second Lien Lenders, and such
Stock was issued in compliance with all applicable state, federal and foreign
laws concerning the issuance of securities; (iii) the identity of the holders of
the Stock of each of the Credit Parties (other than Holdings) and their
Subsidiaries and the percentage of their fully-diluted ownership of the Stock of
each of the Credit Parties and their Subsidiaries is set forth on SCHEDULE
3.1(B); and (iv) no Stock of any Credit Party or any of their Subsidiaries,
other than those described above, are issued and outstanding. Except as provided
in SCHEDULE 3.1(B), as of the Closing Date, there are no preemptive or other
outstanding rights, options, warrants, conversion rights or similar agreements
or understandings for the purchase or acquisition from any Credit Party or any
of their Subsidiaries of any Stock of any such entity. No Credit Party has any
Subsidiaries except as set forth on SCHEDULE 3.1(B).
BINDING OBLIGATION. This Agreement is, and the other Loan Documents and Related
Transactions Documents when executed and delivered will be, the legally valid
and binding obligations of the Credit Parties, each enforceable against each
Credit Party, as applicable, in accordance with their respective terms, except
as may be limited by bankruptcy, insolvency, reorganization, moratorium or other
laws affecting, creditors' rights generally and the effects of general
principles of equity.
20
DISCLOSURE. No representation or warranty of any Credit Party contained in this
Agreement, the Financial Statements referred to in SECTION 3.5, the other
Related Transactions (other than Projections, as to which the only
representation and warranty made is as set forth in Section 3.5 hereof), the
other Loan Documents or any other document, certificate or written statement
furnished to Agent or any Lender by or on behalf of any such Person for use in
connection with the Loan Documents or the Related Transactions Documents
contains any untrue statement of a material fact or omitted, omits or will omit
to state a material fact necessary in order to make the statements contained
herein or therein not misleading in any material respect in light of the
circumstances in which the same were made.
NO MATERIAL ADVERSE EFFECT. Since October 31, 2005 there have been no events or
changes in facts or circumstances affecting the Credit Parties which
individually or in the aggregate have had or would reasonably be expected to
have a Material Adverse Effect.
NO CONFLICT. The consummation of the Related Transactions does not and will not
violate or conflict with any laws, rules, regulations or orders of any
Governmental Authority or violate, conflict with, result in a breach of, or
constitute a default (with due notice or lapse of time or both) under any
Contractual Obligation or organizational documents of any Credit Party or any of
its Subsidiaries, except if such violations, conflicts, breaches or defaults
have not had and would not reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect.
FINANCIAL STATEMENTS AND PROJECTIONS. All Financial Statements concerning
Holdings and its Subsidiaries which have been or will hereafter be furnished to
Agent pursuant to this Agreement, including those listed below, have been or
will be prepared in accordance with GAAP consistently applied (except as
disclosed therein) and do or will present fairly in all material respects the
financial condition of the entities covered thereby as at the dates thereof and
the results of their operations for the periods then ended, subject to, in the
case of unaudited Financial Statements, the absence of footnotes and normal
year-end adjustments.
The consolidated balance sheets at October 31, 2005 and the related statement of
income of Holdings and its Subsidiaries, for the Fiscal Year then ended, audited
by ▇▇▇▇ ▇▇▇▇▇ LLP.
The consolidated balance sheet at December 31, 2005 and the related statement of
income of Holdings and its Subsidiaries for the two (2) months then ended.
The Projections delivered on or prior to the Closing Date and the updated
Projections delivered pursuant to SECTION 6.2(H) represent and will represent as
of the date thereof the good faith estimate of Borrower and its senior
management concerning the most probable course of its business.
21
SOLVENCY. BORROWER IS SOLVENT AND THE CREDIT PARTIES AND THEIR SUBSIDIARIES,
----------------------------------------------------------------------------
TAKEN AS A WHOLE, ARE SOLVENT.
------------------------------
USE OF PROCEEDS; MARGIN REGULATIONS. i) No part of the proceeds of any Loan will
be used for "buying" or "carrying" "margin stock" within the respective meanings
of such terms under Regulation U of the Board of Governors of the Federal
Reserve System as now and from time to time hereafter in effect or for any other
purpose that violates the provisions of the regulations of the Board of
Governors of the Federal Reserve System. If requested by Agent, each Credit
Party will furnish to Agent and each Lender a statement to the foregoing effect
in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.
Borrower shall utilize the proceeds of the Loans solely for the Refinancing (and
to pay any related transaction expenses), and for the financing of Borrower's
ordinary working capital and general corporate needs. SCHEDULE 3.7 contains a
description of Borrower's sources and uses of funds as of the Closing Date,
including Loans and Letter of Credit Obligations to be made or incurred on that
date, and a funds flow memorandum detailing how funds from each source are to be
transferred for particular uses.
None of Holdings or any of its Subsidiaries is subject to regulation as (i) an
"investment company" as defined in, or subject to regulation under, the
Investment Company Act of 1940 or (ii) a "holding company" as defined in, or
subject to regulation under, the Public Utility Holding Company Act of 1935.
22
BROKERS. No broker or finder acting on behalf of any Credit Party or Affiliate
thereof brought about the obtaining, making or closing of the Loans or the
Related Transactions, and no Credit Party or Affiliate thereof has any
obligation to any Person in respect of any finder's or brokerage fees in
connection therewith.
COMPLIANCE WITH LAWS. Each Credit Party represents and warrants that it (i) is
in compliance and each of its Subsidiaries is in compliance with the
requirements of all applicable laws, rules, regulations and orders of any
Governmental Authority (including, without limitation, Executive Order No. 13224
on Terrorist Financing, effective September 24, 2001, and the Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Public Law 107-56) and the obligations,
covenants and conditions contained in all Contractual Obligations other than
those laws, rules, regulations, orders and provisions of such Contractual
Obligations the noncompliance with which would not be reasonably expected to
have, either individually or in the aggregate, a Material Adverse Effect, and
(ii) maintains and each of its Subsidiaries maintains all licenses,
qualifications and permits referred to above other than any failure to maintain
which would not reasonably be expected to have a Material Adverse Effect.
INTELLECTUAL PROPERTY. As of the Closing Date, each of the Credit Parties and
its Subsidiaries owns, is licensed to use or otherwise has the right to use, all
material Intellectual Property used in or necessary for the conduct of its
business as currently conducted that is material to the financial condition,
business or operations of such Credit Party and its Subsidiaries and all such
Intellectual Property that is federally registered as of the Closing Date is
identified on SCHEDULE 3.10 and duly and properly registered, filed or issued in
the applicable office and jurisdictions for such registrations, filings or
issuances. As of the Closing Date, except as disclosed in SCHEDULE 3.10, to
their knowledge, the use of such Intellectual Property by the Credit Parties and
their Subsidiaries and the conduct of their businesses does not and has not been
alleged by any Person to infringe on the rights of any Person.
INVESTIGATIONS, AUDITS, ETC. As of the Closing Date, except as set forth on
SCHEDULE 3.11, no Credit Party or any of their Subsidiaries is the subject of an
audit by the IRS or, to each Credit Party's knowledge, any review by the IRS or
any governmental investigation concerning the violation or possible violation of
any law.
EMPLOYEE MATTERS. As of the Closing Date, except as set forth on SCHEDULE 3.12,
(a) no Credit Party or Subsidiary of a Credit Party nor any of their respective
employees is subject to any collective bargaining agreement, (b) no petition for
certification or union election is pending with respect to the employees of any
Credit Party or any of their Subsidiaries and no union or collective bargaining
unit has sought such certification or recognition with respect to the employees
of any Credit Party or any of their Subsidiaries, (c) there are no strikes,
slowdowns, work stoppages or controversies pending or, to the best knowledge of
any Credit Party after due inquiry, threatened between any Credit Party or any
of their Subsidiaries and its respective employees, other than employee
grievances arising in the ordinary course of business which could not reasonably
be expected to have, either individually or in the aggregate, a Material Adverse
Effect and (d) hours worked by and payment made to employees of each Credit
Party and each of their Subsidiaries comply in all material respects with the
Fair Labor Standards Act and each other federal, state, provincial, local or
foreign law applicable to such matters. Except as set forth on SCHEDULE 3.12,
neither Borrower nor any of its Subsidiaries is party to a material employment
contract.
23
LITIGATION; ADVERSE FACTS. Except as set forth on SCHEDULE 3.13, there are no
judgments outstanding against any Credit Party or any of its Subsidiaries or
affecting any property of any Credit Party or any of its Subsidiaries as of the
Closing Date, nor is there any Litigation pending, or to the best knowledge of
any Credit Party threatened, against any Credit Party or any of its
Subsidiaries, in each case which would reasonably be expected to result in any
Material Adverse Effect.
OWNERSHIP OF PROPERTY; LIENS. As of the Closing Date, the real estate ("REAL
ESTATE") listed in SCHEDULE 3.14 constitutes all of the real property owned,
leased, subleased, or used by any Credit Party or any of its Subsidiaries. As of
the Closing Date, each of the Credit Parties and each of its Subsidiaries owns
good and marketable fee simple title to all of its owned Real Estate, and valid
and marketable leasehold interests in all of its leased Real Estate, all as
described on SCHEDULE 3.14, and copies of all such leases or a summary of terms
thereof reasonably satisfactory to Agent have been delivered to Agent. SCHEDULE
3.14 further describes any Real Estate with respect to which any Credit Party or
any of its Subsidiaries is a lessor, sublessor or assignor as of the Closing
Date. As of the Closing Date, each of the Credit Parties and each of its
Subsidiaries also has good and marketable title to, or valid leasehold interests
in, all of its personal property and assets subject to applicable Permitted
Encumbrances. As of the Closing Date, none of the properties and assets of any
Credit Party or any of its Subsidiaries are subject to any Liens other than
Permitted Encumbrances, and there are no facts, circumstances or conditions
known to Borrower that are reasonably likely to result in any Liens (including
Liens arising under Environmental Laws) other than Permitted Encumbrances
against the properties or assets of any Credit Party or any of its Subsidiaries.
Each of the Credit Parties and each of its Subsidiaries has received all deeds,
assignments, waivers, consents, nondisturbance and attornment or similar
agreements, bills of sale and other documents, and has duly effected all
recordings, filings and other actions necessary to establish, protect and
perfect such Credit Party's or Subsidiary's right, title and interest in and to
all such Real Estate and other properties and assets. As of the Closing Date,
SCHEDULE 3.14 also describes any purchase options, rights of first refusal or
other similar contractual rights pertaining to any Real Estate. As of the
Closing Date, no portion of any Credit Party's or any of its Subsidiaries' Real
Estate necessary to operate the Borrower's business in the ordinary course has
suffered any material damage by fire or other material casualty loss that has
not heretofore been repaired, restored or otherwise remedied as reasonably
necessary to operate the Borrower's business in the ordinary course. As of the
Closing Date, all material permits required to have been issued or appropriate
to enable the Real Estate to be lawfully occupied and used for all of the
purposes for which it is currently occupied and used have been lawfully issued
and are in full force and effect.
ENVIRONMENTAL MATTERS.
----------------------
Except as set forth in SCHEDULE 3.15, as of the Closing Date: (i) the Real
Estate is free of contamination from any Hazardous Material except for such
contamination that could not reasonably be expected to materially adversely
impact the value or marketability of such Real Estate and that could not
reasonably be expected to result in Environmental Liabilities of the Credit
Parties or their Subsidiaries in excess of $100,000 in the aggregate; (ii) no
Credit Party and no Subsidiary of a Credit Party has caused or suffered to occur
any Release of Hazardous Materials on, at, in, under, above, to, from or about
24
any of their Real Estate where such Release could reasonably be expected to
have, either individually or in the aggregate, a Material Adverse Effect; (iii)
the Credit Parties and their Subsidiaries are and have been in compliance with
all Environmental Laws, except for such noncompliance that could not reasonably
be expected to result in Environmental Liabilities of the Credit Parties or
their Subsidiaries in excess of $100,000 in the aggregate; (iv) the Credit
Parties and their Subsidiaries have obtained, and are in compliance with, all
Environmental Permits required by Environmental Laws for the operations of their
respective businesses as presently conducted or as proposed to be conducted,
except where the failure to so obtain or comply with such Environmental Permits
could not reasonably be expected to result in Environmental Liabilities of the
Credit Parties or their Subsidiaries in excess of $100,000 in the aggregate, and
all such Environmental Permits are valid, uncontested and in good standing; (v)
no Credit Party and no Subsidiary of a Credit Party is involved in operations or
knows of any facts, circumstances or conditions, including any Releases of
Hazardous Materials, that are likely to result in any Environmental Liabilities
of such Credit Party or Subsidiary which could reasonably be expected to be in
excess of $100,000 in the aggregate, and no Credit Party or Subsidiary of a
Credit Party has permitted any current or former tenant or occupant of the Real
Estate to engage in any such operations; (vi) there is no Litigation arising
under or related to any Environmental Laws, Environmental Permits or Hazardous
Material that seeks damages, penalties, fines, costs or expenses in excess of
$100,000 in the aggregate or injunctive relief against, or that alleges criminal
misconduct by any Credit Party or any Subsidiary of a Credit Party; (vii) no
notice has been received by any Credit Party or any Subsidiary of a Credit Party
identifying any of them as a "potentially responsible party" or requesting
information under CERCLA or analogous state statutes, and to the knowledge of
the Credit Parties, there are no facts, circumstances or conditions that may
result in any of the Credit Parties or their Subsidiaries being identified as a
"potentially responsible party" under CERCLA or analogous state statutes; and
(viii) the Credit Parties have provided to Agent copies of all existing
environmental reports, reviews and audits and all written information pertaining
to actual or potential Environmental Liabilities, in each case in possession of
the Credit Parties relating to any of the Credit Parties or their Subsidiaries.
Each Credit Party hereby acknowledges and agrees that Agent (i) is not now, and
has not ever been, in control of any of the Real Estate or affairs of such
Credit Party or its Subsidiaries , and (ii) does not have the capacity through
the provisions of the Loan Documents or otherwise to influence any Credit
Party's or its Subsidiaries' conduct with respect to the ownership, operation or
management of any of their Real Estate or compliance with Environmental Laws or
Environmental Permits.
ERISA.
------
SCHEDULE 3.16 lists all Title IV Plans and Multiemployer Plans. As of the
Closing Date, copies of all such listed Plans, together with a copy of the three
most recent form IRS/DOL 5500-series for each such Plan, to the extent
applicable, have been delivered to Agent. Except with respect to Multiemployer
Plans, each Qualified Plan has been determined by the IRS to qualify under
Section 401(a) of the IRC, and to the knowledge of the applicable Credit Party,
nothing has occurred that would cause the loss of such qualification. Except as
would not reasonably be expected to have a Material Adverse Effect, each Plan is
in material compliance with the applicable provisions of ERISA and the IRC.
Neither any Credit Party nor ERISA Affiliate has failed to make any contribution
or pay any amount due as required by either Section 412 of the IRC or Section
25
302 of ERISA or the terms of any Title IV Plan. No Credit Party has engaged in a
"prohibited transaction," as defined in Section 406 of ERISA and Section 4975 of
the IRC, in connection with any Plan, that would subject any Credit Party to a
material tax on prohibited transactions imposed by Section 502(i) of ERISA or
Section 4975 of the IRC.
As of the Closing Date, except as set forth in SCHEDULE 3.16: (i) no Title IV
Plan has any Unfunded Pension Liability; (ii) no ERISA Event or event described
in Section 4062(e) of ERISA with respect to any Title IV Plan has occurred or is
reasonably expected to occur; (iii) there are no pending, or to the knowledge of
Borrower, threatened claims (other than claims for benefits in the normal
course), sanctions, actions or lawsuits, asserted or instituted against any Plan
or any Person as fiduciary or sponsor of any Plan that could result in liability
to a Credit Party; (iv) within the last five years no Title IV Plan of any
Credit Party or ERISA Affiliate has been terminated, whether or not in a
"standard termination" as that term is used in Section 404(b)(1) of ERISA, that
remains unsatisfied or could reasonably be expected to result in liability to
any Credit Party in excess of $500,000, nor has any Title IV Plan of any Credit
Party or ERISA Affiliate (determined at any time within the past five years)
with Unfunded Pension Liabilities been transferred outside of the "controlled
group" (within the meaning of Section 4001(a)(14) of ERISA) of any Credit Party
or ERISA Affiliate that has or could reasonably be expected to result in a
Material Adverse Effect.
DEPOSIT AND DISBURSEMENT ACCOUNTS. SCHEDULE 3.17 lists all banks and other
financial institutions at which any Credit Party maintains deposit or other
accounts as of the Closing Date, including any Disbursement Accounts, and such
SCHEDULE correctly identifies the name, address and telephone number of each
depository, the name in which the account is held, a description of the purpose
of the account, and the complete account number therefor.
AGREEMENTS AND OTHER DOCUMENTS. As of the Closing Date, each Credit Party has
provided to Agent or its counsel, on behalf of Lenders, accurate and complete
copies (or summaries) of all of the following agreements or documents to which
it is subject and each of which is listed in SCHEDULE 3.18: supply agreements
and purchase agreements not terminable by such Credit Party within sixty (60)
days following written notice issued by such Credit Party and involving
transactions in excess of $1,000,000 per annum (other than purchase orders
entered into in the ordinary course of business); leases of Equipment having a
remaining term of one year or longer and requiring aggregate rental and other
payments in excess of $500,000 per annum (other than purchase orders entered
into in the ordinary course of business); licenses and permits held by the
Credit Parties, the absence of which would reasonably be expected to have a
Material Adverse Effect; instruments and documents evidencing any Indebtedness
or Guaranteed Indebtedness of such Credit Party, other than guaranties issued by
Holdings or Borrower of leases for leased premises of any Credit Party, and any
Lien granted by such Credit Party with respect thereto which are to remain in
effect after the Closing Date; and instruments and agreements evidencing the
issuance of any equity securities, warrants, rights or options to purchase
equity securities of such Credit Party.
INSURANCE. Each Credit Party represents and warrants that it and each of its
Subsidiaries currently maintains in good repair, working order and condition
(normal wear and tear excepted) all material properties as set forth in SECTION
4.2 and maintains all insurance described in such SECTION. SCHEDULE 3.19 lists
all insurance policies of any nature maintained, as of the Closing Date, for
current occurrences by each Credit Party, as well as a summary of the key
business terms of each such policy such as deductibles, coverage limits and term
of policy.
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TAXES AND TAX RETURNS.
----------------------
As of the Closing Date, (i) all Tax Returns required to be filed by the Credit
Parties have been timely and properly filed and (ii) all taxes that are due
(other than taxes being contested in good faith by appropriate proceedings and
for which adequate reserves have been provided for in accordance with GAAP) have
been paid, in each case except where the failure to file Tax Returns or pay
Taxes would not reasonably be expected to have a Material Adverse Effect. No
Governmental Authority has asserted any claim for taxes, or to any Credit
Party's knowledge, has threatened to assert any claim for taxes that would, if
not paid by a Credit Party, have a Material Adverse Effect. All taxes required
by law to be withheld or collected and remitted (including, without limitation,
income tax, unemployment insurance and workmen's compensation premiums) with
respect to the Credit Parties have been withheld or collected and paid to the
appropriate Governmental Authorities (or are properly being held for such
payment), except for amounts the nonpayment of which would not be reasonably
likely to have a Material Adverse Effect.
None of the Credit Parties has been notified that either the IRS, or any other
Governmental Authority, has raised or intends to raise, any adjustments with
respect to Taxes of the Credit Parties, which adjustments would be reasonably
likely to have a Material Adverse Effect.
SENIOR INDEBTEDNESS AND DESIGNATED SENIOR INDEBTEDNESS. This Agreement, the
credit facilities created hereunder and all present and future Obligations
constitute the "Senior Indebtedness" under and as such terms are defined in the
Indenture. Without limiting the foregoing, all present and future Obligations
are hereby designated as "Senior Indebtedness" in each case as such terms are
used in the Indenture. The Subordinated Notes are unsecured and no Credit Party
other than Holdings has any liabilities or obligations (by guaranty or
otherwise) with respect to the Subordinated Notes.
HEALTH CARE MATTERS.
--------------------
COMPLIANCE WITH HEALTH CARE LAWS; PERMITS. Each Credit Party and each of their
Subsidiaries, and any Person acting on their behalf, is in compliance in all
material respects with all Health Care Laws applicable to it, its products and
its properties or other assets or its business or operation, including its
provision of professional services. Each Credit Party and each of their
Subsidiaries, and any Person acting on their behalf, has in effect all Permits,
including, without limitation, all Permits necessary for it to own, lease or
operate its properties and other assets and to carry on its business and
operations, including its provision of professional services, as presently
conducted. All such Permits are in full force and effect and there has occurred
no default under, or violation of, any such Permit. Except as set forth on
SCHEDULE 3.22, no action, demand, requirement or investigation by any
Governmental Authority and no suit, action or proceeding by any other person, in
each case with respect to each Credit Party, each of their Subsidiaries, any
Person acting on their behalf, or any of their respective properties, other
assets or provision of professional services under any Requirements of Law, is
pending or, to the knowledge of each Credit Party and their Subsidiaries,
threatened.
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FILINGS. Except as set forth on SCHEDULE 3.22, all reports, documents, claims,
notices or approvals required to be filed, obtained, maintained or furnished to
any Governmental Authority have been so filed, obtained, maintained or
furnished, and all such reports, documents, claims and notices were complete and
correct in all material respects on the date filed (or were corrected in or
supplemented by a subsequent filing).
MATERIAL STATEMENTS. No Credit Party nor any of their Subsidiaries, nor any
officer, affiliate, employee or agent of any Credit Party or any of their
Subsidiaries, has made an untrue statement of a material fact or fraudulent
statement to any Governmental Authority, failed to disclose a material fact
required to any Governmental Authority, or committed an act, made a statement,
or failed to make a statement that, at the time such disclosure was made, would
reasonably be expected to constitute a violation of any Health Care Law. No
Credit Party nor any of their Subsidiaries, nor any officer, affiliate, employee
or agent of any Credit Party or any of their Subsidiaries, has made any untrue
statement of fact regarding claims incurred but not reported.
BILLING. Each Credit Party, each of their Subsidiaries and each contracting
physician of each Credit Party or any of their Subsidiaries (to the extent
required) has the requisite provider number or other Permit to ▇▇▇▇ the Medicare
program (to the extent such entity participates in the Medicare program), the
respective Medicaid program in the state or states in which such entity
operates, and all other Third Party Payor Programs (as defined below), including
but not limited to Capitated Contracts with managed care organizations, that
each Credit Party and each of their Subsidiaries currently ▇▇▇▇. There is no
investigation, audit, claim review, or other action pending, or to the knowledge
of any Credit Party or their Subsidiaries, threatened which could result in a
revocation, suspension, termination, probation, restriction, limitation, or
non-renewal of any Third Party Payor (as defined below) provider number or
result in any Credit Party's or any of their Subsidiaries' exclusion from any
Third Party Payor Program. No Credit Party nor any of their Subsidiaries has
billed or received any payment or reimbursement in excess of amounts allowed by
any Health Care Law or other law. For purposes of this Agreement, a "THIRD PARTY
PAYOR" means Medicare, Medicaid, TRICARE, Blue Cross and/or Blue Shield, state
government insurers, private insurers and any other person or entity which
presently or in the future maintains Third Party Payor Programs. In addition,
for purposes of this Agreement, "THIRD PARTY PAYOR PROGRAMS" means all third
party payor programs in which Borrower, each of the Credit Parties and each of
its Subsidiaries participates (including, without limitation, Medicare,
Medicaid, TRICARE or any other federal or state health care programs, as well as
Blue Cross and/or Blue Shield, managed care plans, or any other private
insurance programs).
PROCEEDINGS. There are no facts, circumstances or conditions that would
reasonably be expected to form the basis for any material investigation, suit,
claim, audit, action (legal or regulatory) or proceeding (legal or regulatory)
by a Governmental Authority against or affecting any Credit Party or any of
their Subsidiaries relating to any of the Health Care Laws.
PROHIBITED TRANSACTIONS. No Credit Party, any of their Subsidiaries or any
Person acting on behalf of any Credit Party or any of their Subsidiaries is a
party to any contract, lease agreement or other arrangement (including any joint
venture or consulting agreement) with any physician, health care facility,
hospital, nursing facility, home health agency or other person who is in a
position to make or influence referrals to or otherwise generate business to
provide services, lease space, lease equipment or engage in any other venture or
activity, other than agreements which are in compliance with all applicable
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Health Care Laws. No Credit Party, any of their Subsidiaries, or any person
acting on behalf of any Credit Parties or any their Subsidiaries, directly or
indirectly: (1) offered or paid any remuneration, in cash or in kind, to, or
made any financial arrangements with, any past, present or potential patient,
supplier, medical staff member, contractor or Third Party Payor of any Credit
Parties and/or any of their Subsidiaries in order to illegally obtain business
or payments from such person; (2) given or agreed to give, or is aware that
there has been made or that there is any illegal agreement to make, any illegal
gift or gratuitous payment of any kind, nature or description (whether in money,
property or services) to any past, present or potential patient, supplier,
contractor, Third Party Payor or any other person; (3) made or agreed to make,
or is aware that there has been made or that there is any agreement to make, any
contribution, payment or gift of funds or property to, or for the private use
of, any governmental official, employee or agent where either the contribution,
payment or gift or the purpose of such contribution, payment or gift is or was
illegal under the laws of any government entity having jurisdiction over such
payment, contribution or gift; (4) established or maintained any unrecorded fund
or asset for any purpose or made any misleading, false or artificial entries on
any of its books or records for any reason; or (5) made, or agreed to make, or
is aware that there has been made or that there is any agreement to make, any
payment to any person with the intention or understanding that any part of such
payment would be used or was given for any purpose other than that described in
the documents supporting such payment.
FAIR MARKET VALUE. The compensation paid or to be paid by each Credit Party and
each of their Subsidiaries to any physician or physician group who is employed
by or contracted with each Credit Party or any of their Subsidiaries is fair
market value for the services and items actually provided by such physician, not
taking into account the value or volume of referrals or other business generated
by such physicians or physician groups for each Credit Party or each of their
Subsidiaries. Each Credit Party and each of their Subsidiaries has at all times
maintained a written agreement with each physician or physician group receiving
compensation from each Credit Party or any of their Subsidiaries.
MEDICARE/MEDICAID. There are no Medicare or Medicaid termination proceedings
underway with respect to any of the Credit Parties, each entity meets the
Medicare conditions of participation and, to our knowledge after such reasonable
investigation under the circumstances, no employee or independent contractor of
any Credit Parties has been excluded in participating in Medicare or Medicaid or
any similar federal programs.
COMPLIANCE. Each Credit Parties possess and implement all necessary policies and
procedures to ensure that all aspects of each Credit Parties' operations, their
employees, and all healthcare providers under contract with any Credit Party,
comply with all applicable Health Care Laws.
AFFIRMATIVE COVENANTS
Each Credit Party executing this Agreement jointly and severally agrees
as to all Credit Parties that from and after the date hereof and until the
Termination Date:
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COMPLIANCE WITH LAWS AND CONTRACTUAL OBLIGATIONS. Each Credit Party will (a)
comply with and shall cause each of its Subsidiaries to comply with (i) the
requirements of all applicable material laws, rules, regulations and orders of
any Governmental Authority (including, without limitation, laws, rules,
regulations and orders relating to taxes, employer and employee contributions,
securities, employee retirement and welfare benefits, environmental protection
matters and employee health and safety) as now in effect and which may be
imposed in the future in all jurisdictions in which any Credit Party or any of
its Subsidiaries is now doing business or may hereafter be doing business and
(ii) the obligations, covenants and conditions contained in all Contractual
Obligations of such Credit Party or any of its Subsidiaries other than the
noncompliance with which would not be reasonably expected to have, either
individually or in the aggregate, a Material Adverse Effect, and (b) maintain or
obtain and shall cause each of its Subsidiaries to maintain or obtain all
licenses, qualifications and permits now held or hereafter required to be held
by such Credit Party or any of its Subsidiaries, for which the loss, suspension,
revocation or failure to obtain or renew, would reasonably be expected to have,
either individually or in the aggregate, a Material Adverse Effect. This SECTION
4.1 shall not preclude any Credit Party or its Subsidiaries from contesting any
taxes or other payments, if they are being diligently contested in good faith in
a manner which stays enforcement thereof and if appropriate expense provisions
have been recorded in conformity with GAAP, subject to SECTION 5.2 and no Lien
(other than a Permitted Encumbrance) in respect thereof has been created.
INSURANCE. Each Credit Party will maintain or cause to be maintained, with
insurers reasonably acceptable to Agent, public liability and property damage
insurance with respect to its business and properties and the business and
properties of its Subsidiaries against loss or damage of the kinds customarily
carried or maintained by corporations of established reputation engaged in
substantially similar businesses and in amounts reasonably acceptable to Agent
and will deliver evidence thereof to Agent. Agent confirms that the insurance in
effect on the Closing Date is reasonably acceptable to it. The Credit Parties
shall maintain business interruption insurance providing coverage for a period
of at least six (6) months and in an amount not less than $20,000,000. Each
Credit Party shall, pursuant to endorsements and/or assignments in form and
substance reasonably satisfactory to Agent, (i) cause Agent to be named as
lender's loss payee in the case of casualty insurance, and assignee in the case
of all business interruption insurance, in each case for the benefit of Agent
and Lenders and (ii) cause Agent and each Lender to be named as additional
insureds in the case of all liability insurance other than professional
liability insurance. So long as no Event of Default has occurred and is
continuing, proceeds of business interruption insurance will be released to the
Credit Parties. In the event any Credit Party fails to provide Agent with
evidence of the insurance coverage required by this Agreement, Agent may
purchase insurance at such Credit Party's expense to protect Agent's interests
in the Collateral. This insurance may, but need not, protect such Credit Party's
interests. The coverage purchased by Agent may not pay any claim made by such
Credit Party or any claim that is made against such Credit Party in connection
with the Collateral. Such Credit Party may later cancel any insurance purchased
by Agent, but only after providing Agent with evidence that such Credit Party
has obtained insurance as required by this Agreement. If Agent purchases
insurance for the Collateral, such Credit Party will be responsible for the
costs of that insurance, including interest and other Charges imposed by Agent
in connection with the placement of the insurance, until the effective date of
the cancellation or expiration of the insurance. The costs of the insurance may
be added to the Obligations. The costs of the insurance may be more than the
cost of insurance such Credit Party is able to obtain on its own.
30
INSPECTION; LENDER MEETING. Upon three (3) days' prior written notice to the
Credit Parties and the Lenders, each Credit Party shall permit any authorized
representatives of Agent to visit, audit and inspect any of the properties of
such Credit Party and its Subsidiaries, including its and their financial and
accounting records (which audits and inspections of financial and accounting
records shall in the absence of an Event of Default take place in Borrower's
corporate office), and to make copies and take extracts therefrom, and to
discuss its and their affairs, finances and business with its and their officers
and certified public accountants, at such reasonable times during normal
business hours and as often as may be reasonably requested (collectively a
"FIELD REVIEW"); provided, that, upon the occurrence and continuance of an Event
of Default, Agent shall not be required to provide any notice to the Credit
Parties prior to the performance of a Field Review; provided further, that, so
long as no Event of Default has occurred and is continuing, Agent shall be
limited to two (2) Field Reviews during any calendar year. Representatives of
each Lender will be permitted to accompany representatives of Agent during each
Field Review at such Lender's expense. In addition to the foregoing, each Credit
Party will participate and will cause key management personnel of each Credit
Party and its Subsidiaries to participate in a meeting with Agent and Lenders at
least once during each year, which meeting shall be held at such time and such
place as may be reasonably requested by Agent.
ORGANIZATIONAL EXISTENCE. Except as otherwise permitted by SECTION 5.6, each
Credit Party will and will cause its material Subsidiaries to at all times
preserve and keep in full force and effect its organizational existence and all
rights and franchises material to its business.
ENVIRONMENTAL MATTERS. Each Credit Party shall and shall cause each Person
within its control to: (a) conduct its operations and keep and maintain its Real
Estate in compliance with all Environmental Laws and Environmental Permits other
than noncompliance that would not reasonably be expected to have a Material
Adverse Effect; (b) implement any and all investigation, remediation, removal
and response actions that are appropriate or necessary to maintain the value and
marketability of the Real Estate or to otherwise comply with Environmental Laws
and Environmental Permits pertaining to the presence, generation, treatment,
storage, use, disposal, transportation or Release of any Hazardous Material on,
at, in, under, above, to, from or about any of its Real Estate, except where the
failure to do so would not reasonably be expected to have, either individually
or in the aggregate, a Material Adverse Effect; (c) notify Agent promptly after
such Credit Party or any Person within its control becomes aware of any
violation of Environmental Laws or Environmental Permits or any Release on, at,
in, under, above, to, from or about any Real Estate that is reasonably likely to
result in Environmental Liabilities to a Credit Party or its Subsidiaries in
excess of $100,000; and (d) promptly forward to Agent a copy of any order,
notice of actual or alleged violation or liability, request for information or
any communication or report received by such Credit Party or any Person within
its control in connection with any such violation or Release or any other matter
relating to any Environmental Laws or Environmental Permits that could
reasonably be expected to result in Environmental Liabilities in excess of
$100,000, in each case whether or not the Environmental Protection Agency or any
Governmental Authority has taken or threatened any action in connection with any
such violation, Release or other matter. If Agent at any time has a reasonable
31
basis to believe that there may be a violation of any Environmental Laws or
Environmental Permits by any Credit Party or any Person under its control or any
Environmental Liability arising thereunder, or a Release of Hazardous Materials
on, at, in, under, above, to, from or about any of its Real Estate, that, in
each case, could reasonably be expected to have a Material Adverse Effect, then
each Credit Party and its Subsidiaries shall, upon Agent's written request (i)
cause the performance of such environmental audits including subsurface sampling
of soil and groundwater, and preparation of such environmental reports, at
Borrower's expense, as Agent may from time to time reasonably request, which
shall be conducted by reputable environmental consulting firms reasonably
acceptable to Agent and shall be in form and substance reasonably acceptable to
Agent, and (ii) if the Credit Parties fail to perform (or cause performance of)
any environmental audit under SECTION 4.5(D)(I) above within a reasonable time
after receiving a written request from Agent, Credit Parties shall permit Agent
or its representatives to have reasonable access to all Real Estate for the
purpose of conducting such environmental audits and testing as Agent deems
appropriate, including subsurface sampling of soil and groundwater. Borrower
shall reimburse Agent for the costs of such audits and tests and the same will
constitute a part of the Obligations. Agent confirms that the environmental
reports provided on or before the Closing Date are satisfactory to it.
LANDLORDS' AGREEMENTS, MORTGAGEE AGREEMENTS, BAILEE LETTERS AND REAL ESTATE
PURCHASES. Each Credit Party shall use reasonable efforts to obtain a landlord's
agreement, mortgagee agreement or bailee letter, as applicable, from the lessor
of Borrower's corporate office, which agreement or letter shall contain a waiver
or subordination of all Liens or claims that the landlord, mortgagee or bailee
may assert against the Collateral at that location, and shall otherwise be
reasonably satisfactory in form and substance to Agent. Each Credit Party shall
and shall cause its Subsidiaries to timely and fully pay and perform their
obligations under all leases and other agreements with respect to each leased
location or public warehouse where any Collateral is or may be located (other
than Collateral in an aggregate amount for all such locations not to exceed
$100,000 in the aggregate).
FURTHER ASSURANCES.
-------------------
Each Credit Party shall, from time to time, execute such guaranties, financing
statements, documents, security agreements and reports as Agent or Requisite
Lenders at any time may reasonably request to evidence, perfect or otherwise
implement the guaranties and security for repayment of the Obligations
contemplated by the Loan Documents.
In the event any Credit Party acquires a fee ownership interest in real property
after the Closing Date, such Credit Party shall deliver to Agent a fully
executed mortgage or deed of trust over such real property in form and substance
reasonably satisfactory to Agent, together with such title insurance policies,
surveys, appraisals, evidence of insurance, legal opinions, environmental
assessments and other documents and certificates as shall be reasonably required
by Agent.
Each Credit Party shall (i) cause each Person, upon its becoming a Domestic
Subsidiary of such Credit Party (provided that this shall not be construed to
constitute consent by any of the Lenders to any transaction not expressly
permitted by the terms of this Agreement), promptly to guaranty the Obligations
and to grant to Agent, for the benefit of Agent and Lenders, a security interest
in the real, personal and mixed property of such Domestic Subsidiary to secure
the Obligations and (ii) pledge, or cause to be pledged, to Agent, for the
benefit of Agent and Lenders, all of the Stock of such Domestic Subsidiary to
32
secure the Obligations. Each Credit Party shall pledge, or cause to be pledged,
to Agent, for the benefit of Agent and Lenders, 66% of the outstanding voting
Stock and 100% of the outstanding nonvoting Stock of any person upon its
becoming a first tier Foreign Subsidiary of any Credit Party. The documentation
for such guaranty, security and pledge shall be substantially similar to the
Loan Documents executed concurrently herewith with such modifications as are
reasonably requested by Agent.
PAYMENT OF TAXES. Each Credit Party shall timely pay and discharge (or cause to
be paid and discharged) all material taxes, assessments and governmental and
other charges or levies imposed upon it or upon its income or profits, or upon
property belonging to it; provided that such Credit Party shall not be required
to pay any such tax, assessment, charge or levy that is being contested in good
faith by appropriate proceedings and for which the affected Credit Party shall
have set aside on its books adequate reserves with respect thereto in
conformance with GAAP.
CASH MANAGEMENT SYSTEMS. Borrower shall, and shall cause each other Credit Party
to, enter into Control Agreements with respect to each deposit account
maintained by Borrower or any Subsidiary of Borrower (other than any payroll
account so long as such payroll account is a zero balance account) as of or
after the Closing Date. Each such deposit account control agreement shall be in
form and substance reasonably satisfactory to Agent.
INTEREST RATE AGREEMENTS. Within ninety (90) days after the Closing Date,
Borrower shall enter into, and shall thereafter maintain, Interest Rate
Agreements providing for interest rate protection (1) for at least fifty percent
(50%) of the outstanding principal amount of the Term Loan B and Second Lien
Loan and (2) other terms and conditions reasonably satisfactory to Agent.
HEALTHCARE MATTERS. WITHIN FIVE (5) BUSINESS DAYS AFTER ANY CREDIT PARTY
OBTAINING KNOWLEDGE THEREOF: notice of any material investigation or audit, or
pending or threatened proceedings relating to any violation by any Credit Party,
any of their Subsidiaries, or any health care facility to which any Credit Party
or any their Subsidiaries provides services, of any Health Care Laws (including,
without limitation, any investigation or audit or proceeding involving violation
of any of the Medicare and/or Medicaid fraud and abuse provisions);
copies of any written recommendation from any Governmental Authority or other
regulatory body that any Credit Party or any of their Subsidiaries, or any
obligor to which any Credit Party or any their Subsidiaries provides services
should have its licensure, provider or supplier number, or accreditation
suspended, revoked, or limited in any way, or have its eligibility to
participate in TRICARE, Medicare or Medicaid or to accept assignments or rights
to reimbursement under TRICARE, Medicaid or Medicare regulations suspended,
revoked, or limited in any way;
notice of any claim to recover any alleged material overpayments with respect to
any receivables including, without limitation, payments received from TRICARE,
Medicare, Medicaid or from any private insurance carrier;
33
notice of termination of eligibility of any Credit Party, any Subsidiary of any
Credit Party, or any health care facility to which any Credit Party provides
services to participate in any reimbursement program of any private insurance
carrier, managed care or similar organization, or other obligor applicable to
it;
notice of any material reduction in the level of reimbursement expected to be
received with respect to any Receivables;
notice of any reimbursement payment contract or process that results or is
reasonably expected to result in any claim against a Credit Party or any
Subsidiary of such Credit Party (including on account of overpayments,
settlement payments, appeals, repayment plan requests);
copies of any report or communication from any Governmental Authority in
connection with any inspection of any facility of a Credit Party or any
Subsidiary of such Credit Party other those which are routine and non-material;
and
notice of any healthcare provider's fees being contested or disputed.
NEGATIVE COVENANTS
Each Credit Party executing this Agreement jointly and severally agrees
as to all Credit Parties that from and after the date hereof until the
Termination Date:
INDEBTEDNESS. The Credit Parties shall not and shall not cause or permit their
Subsidiaries directly or indirectly to create, incur, assume, or otherwise
become or remain directly or indirectly liable with respect to any Indebtedness
(other than pursuant to a Contingent Obligation permitted under SECTION 5.4)
except:
Indebtedness described on SCHEDULE 5.1;
the Obligations;
the Indebtedness incurred under the Second Lien Credit Agreement, together with
any refinancings, refundings, extensions, renewals and/or replacements thereof
to the extent permitted by the Intercreditor Agreement; provided that the
Incremental Term Loan C shall only be permitted to be incurred on or prior to
December 27, 2007 and so long as the following conditions have been satisfied:
no Default or Event of Default has occurred or is continuing
or would result after giving effect to such Incremental Term Loan C;
the Incremental Term Loan C must be in an aggregate principal
amount not greater than $16,147,000;
the Incremental Term Loan C shall have been consented to in
writing by Agent;
34
the Incremental Term Loan C is funded on the date that
Holdings prepays all outstanding Indebtedness existing with respect to
the Subordinated Notes and the proceeds of such Incremental Term Loan C
are used to fund such prepayment and any fees, expenses and costs
incurred in connection therewith;
the Borrower has provided evidence reasonably satisfactory to
the Agent that the Borrower would have been in compliance with the
financial covenants set forth in SECTION 6 assuming that the
Incremental Term Loan C had been incurred on the last day of the then
most recently completed Fiscal Quarter; and
the Agent receives evidence reasonably satisfactory to the
Agent, that, after giving effect to such Incremental Term Loan C, the
Leverage Ratio is less than 3.50 to 1.00.
the Indebtedness of Holdings incurred under the Subordinated Notes;
intercompany Indebtedness arising from loans made by (i) any Credit Party other
than Holdings, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Radiology and ProNet to any other Credit Party
other than Holdings, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Radiology and ProNet, (ii) Borrower to
▇▇▇▇▇▇▇ on the Closing Date in an aggregate amount not greater than $15,000,000
and (iii) any Credit Party (other than ▇▇▇▇▇▇▇) to ▇▇▇▇▇▇▇ after the Closing
Date in aggregate amount not to exceed $5,000,000 at any time outstanding (in
addition to loans made pursuant to clause (ii) above) at any time outstanding;
provided, however, that upon the request of Agent at any time, such Indebtedness
shall be evidenced by promissory notes having terms reasonably satisfactory to
Agent, the sole originally executed counterparts of which shall be pledged and
delivered to Agent, for the benefit of Agent and Lenders, as security for the
Obligations;
Indebtedness incurred during any Fiscal Year in amount not to exceed $4,000,000
in the aggregate which is secured by purchase money Liens or incurred with
respect to Capital Leases and purchase money Indebtedness (the "YEARLY PMSI
LIMIT"); PROVIDED, HOWEVER, that commencing with Fiscal Year 2007, the Yearly
PMSI Limit will be increased in any period by an amount equal to 50% of the
difference obtained by taking the Yearly PMSI Limit (excluding any Carry Over
Amounts) MINUS the actual amount of such Indebtedness incurred during such prior
period (the "CARRY OVER AMOUNT") (and such Carry Over Amount shall be deemed to
be the last amount of Indebtedness incurred in that succeeding period);
unsecured Indebtedness of a Target incurred in connection with a Permitted
Acquisition so long as the aggregate amount of such unsecured Indebtedness does
not exceed $2,000,000 in the aggregate for any Permitted Acquisition;
any other unsecured Indebtedness not to exceed $1,000,000 in an aggregate
principal amount at any time outstanding;
Indebtedness under Interest Rate Agreements entered into pursuant to SECTION
4.10 entered into to protect Borrower or Subsidiary thereof against fluctuations
in interest rates in respect of Indebtedness otherwise permitted under this
Agreement or (ii) other hedging agreements providing protection against
fluctuations in currency values or commodity prices in connection with
Borrower's or any of its Subsidiaries' operations, so long as the purpose of any
such agreement is a bona fide hedging activity (and is not for speculative
purposes); and
35
refinancings of Indebtedness permitted under clauses (a) and (d) which have been
approved by the Agent and do not accelerate the scheduled dates for payment
thereof, increase the principal amounts thereof, materially increase any
interest rate or fees applicable thereto, add additional obligors therefor, or
enhance the collateral therefor or the priority thereof.
LIENS AND RELATED MATTERS.
--------------------------
NO LIENS. The Credit Parties shall not and shall not cause or permit their
Subsidiaries to directly or indirectly create, incur, assume or permit to exist
any Lien on or with respect to any property or asset of such Credit Party or any
such Subsidiary, whether now owned or hereafter acquired, or any income or
profits therefrom, except Permitted Encumbrances (including, without limitation,
those Liens constituting Permitted Encumbrances existing on the date hereof and
renewals and extensions thereof, as set forth on SCHEDULE 5.2).
NO NEGATIVE PLEDGES. The Credit Parties shall not and shall not cause or permit
their Subsidiaries to directly or indirectly enter into or assume any agreement
(other than the Loan Documents and Second Lien Loan Documents) prohibiting the
creation or assumption of any Lien upon its properties or assets, whether now
owned or hereafter acquired and other than (i) provisions restricting subletting
or assignment under any lease governing a leasehold interest or lease of
personal property; (ii) restrictions with respect to a Subsidiary imposed
pursuant to any agreement which has been entered into for the sale of
disposition of all or substantially all of the equity interests or assets of
such Subsidiary, so long as such sale or disposition of all or substantially all
of the equity interests or assets of such Subsidiary is permitted under this
Agreement; and (iii) restrictions on assignments or sublicensing of licensed
Intellectual Property.
NO RESTRICTIONS ON SUBSIDIARY DISTRIBUTIONS TO BORROWER. Except as provided
herein and the Second Lien Loan Documents, the Credit Parties shall not and
shall not cause or permit their Subsidiaries to directly or indirectly create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction of any kind on the ability of any such Subsidiary to:
(1) pay dividends or make any other distribution on any of such Subsidiary's
Stock owned by Borrower or any other Subsidiary; (2) pay any Indebtedness owed
to Borrower or any other Subsidiary; (3) make loans or advances to Borrower or
any other Subsidiary; or (4) transfer any of its property or assets to Borrower
or any other Subsidiary.
INVESTMENTS. The Credit Parties shall not and shall not cause or permit their
Subsidiaries to directly or indirectly make or own any Investment in any Person
except:
Borrower and its Subsidiaries may make and own Investments in Cash Equivalents
subject to Control Agreements in favor of Agent;
Borrower and the other Credit Parties may make loans to other Credit Parties to
the extent permitted under SECTION 5.1;
36
Borrower and its Subsidiaries may make loans and advances to employees for
moving, entertainment, travel and other similar expenses in the ordinary course
of business not to exceed $500,000 in the aggregate at any time outstanding;
Credit Parties and their Subsidiaries may make capital contributions to their
wholly-owned Subsidiaries that are Credit Parties other than ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Radiology and ProNet;
Investments representing non-cash consideration received in accordance with
SECTION 5.7;
Investments existing on the Closing Date, as set forth on SCHEDULE 5.3 and any
renewals, amendments and replacements thereof that do not increase the amount
thereof;
each Credit Party may hold investments comprised of notes payable, or stock or
other securities issued by financially troubled Account Debtors (excluding
Affiliates) to such Credit Party pursuant to agreements with respect to
settlement of such Account Debtor's Accounts with such Credit Party negotiated
in the ordinary course of business;
Investments consisting of loans by Borrower to employees of Borrower which are
used solely by such employees to simultaneously purchase the Stock of Holdings,
provided that Holdings contemporaneously contributes the proceeds of such Stock
to the capital of Borrower;
Interest Rate Agreements and other hedging agreements entered into in compliance
with SECTION 5.1;
Borrower and its Subsidiaries may make advances in the form of a prepayment of
expenses, so long as such expenses were incurred in the ordinary course of
business and are being paid in accordance with customary trade terms of Borrower
or such Subsidiary; and
Permitted Acquisitions.
CONTINGENT OBLIGATIONS. The Credit Parties shall not and shall not cause or
permit their Subsidiaries to directly or indirectly create or become or be
liable with respect to any Contingent Obligation except:
Contingent Obligations with respect to the Second Lien Loan Obligations and
Letter of Credit Obligations;
those arising under Interest Rate Agreements or other hedging agreements entered
into in compliance with SECTION 5.1;
those resulting from endorsement of negotiable instruments for collection in the
ordinary course of business;
those existing on the Closing Date and described in SCHEDULE 5.4;
those arising under indemnity agreements to title insurers to cause such title
insurers to issue to Agent mortgagee title insurance policies;
37
those arising with respect to customary indemnification obligations incurred in
connection with Asset Dispositions permitted hereunder;
those incurred in the ordinary course of business with respect to (i) surety and
appeal bonds, performance and return-of-money bonds and other similar
obligations not exceeding at any time outstanding $500,000 in aggregate
liability and (ii) bonds required to be posted in connection with worker's
compensation insurance not exceeding at any time outstanding $1,400,000 in
aggregate liability;
those incurred with respect to Indebtedness permitted by SECTION 5.1 (other than
SECTION 5.1(D)) provided that (i) any such Contingent Obligation is subordinated
to the Obligations to the same extent as the Indebtedness to which it relates is
subordinated to the Obligations and (ii) no Credit Party may incur Contingent
Obligations in respect of Indebtedness incurred by any Person that is not a
Credit Party under this clause (h);
guaranties of leases for leased premises of any Credit Party issued by Holdings
and Borrower in ordinary course of business consistent with past practices; and
any other Contingent Obligation not expressly permitted by clauses (a) through
(i) above, so long as any such other Contingent Obligations, in the aggregate at
any time outstanding, do not exceed $500,000 and no Credit Party may incur
Contingent Obligations in respect of Indebtedness incurred by any Person that is
not a Credit Party under this clause (j).
RESTRICTED PAYMENTS. The Credit Parties shall not and shall not cause or permit
their Subsidiaries to directly or indirectly declare, order, pay, make or set
apart any sum for any Restricted Payment, except that:
Each Credit Party other than Holdings may make payments and distributions to
Holdings (whether directly or through sequential upstream Restricted Payments)
that are used by Holdings to pay federal and state income taxes then due and
owing, franchise taxes and other similar licensing expenses incurred in the
ordinary course of business; PROVIDED that each Credit Party's aggregate
contribution to taxes as a result of the filing of a consolidated or combined
return by Holdings shall not be greater, nor the aggregate receipt of tax
benefits less, than they would have been had such Credit Party not filed a
consolidated or combined return with Holdings;
Direct Subsidiaries of Borrower may make Restricted Payments to Borrower;
Except as otherwise expressly prohibited by the Intercreditor Agreement and
provided no optional prepayments are made until the Discharge of First Lien
Obligations (other than in connection with a "Refinancing" thereof (as defined
in, and to the extent permitted by, the Intercreditor Agreement)) Borrower and
each other Credit Party may make payments pursuant to the terms of the Second
Lien Credit Agreement;
Borrower may pay dividends to Holdings to permit Holdings to repurchase Stock
owned by employees of Borrower whose employment with Borrower and its
Subsidiaries has been terminated, provided that such Restricted Payments shall
not exceed $250,000 in any Fiscal Year or $1,000,000 during the term of this
Agreement in the aggregate and provided that no Event of Default exists at the
time of such Restricted Payment or would occur as a result thereof;
38
Borrower may pay dividends to Holdings to permit Holdings to make regularly
scheduled interest payments on the Subordinated Notes in amount not to exceed
$465,000 in any Fiscal Quarter provided that no Event of Default exists at the
time of such Restricted Payment or would occur as a result thereof;
Borrower may pay dividends to Holdings to permit Holdings to pay corporate
overhead expenses in the ordinary course of business, provided that such
Restricted Payments shall not exceed $750,000 in any Fiscal Year and provided
that no Event of Default exists at the time of such Restricted Payment or would
occur as a result thereof;
Borrower may pay dividends to Holdings on the Closing Date in an aggregate
amount not to exceed $4,741,931.83 in order to pay in full certain amounts owed
by Holdings to ▇▇▇▇▇▇ ▇▇▇▇▇▇, M.D., ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ and Galt Financial, Ltd.;
Borrower may pay dividends to Holdings with the proceeds of the Incremental Term
Loan C to permit Holdings to prepay the Subordinated Notes; and
Borrower may pay prepayment fees, early termination charges, make-whole premiums
or similar amounts (including any interest, fees, charges and other amounts
thereon) owing to any Prior Lender as a result of payments or prepayments made
on or prior to the Closing Date (i) upon a payment in full of the Obligations or
(ii) so long as (A) the aggregate amount of such prepayment fees, early
termination charges, make-whole premiums and similar amounts paid (including any
interest, fees, charges and other amounts thereon) shall not exceed $1,235,000,
(B) at the time of such payment the Leverage Ratio shall not exceed 3.50:1,
determined on a pro forma basis after giving effect to such payment and based
upon EBITDA for the twelve Fiscal Month period ending as of the last day of the
most recently completed Fiscal Month, (C) after giving effect to such payment,
the Borrower shall have at least $3,500,000 of availability through a
combination of Borrowing Availability and cash on hand and (D) no Default or
Event of Default exists at the time of such payment or would occur as result
thereof.
RESTRICTION ON FUNDAMENTAL CHANGES. The Credit Parties shall not and shall not
cause or permit their Subsidiaries to directly or indirectly: (a) amend, modify
or waive any term or provision of its organizational documents in a manner
adverse to the Lenders, including its articles of incorporation, certificates of
designations pertaining to preferred stock, by-laws, partnership agreement or
operating agreement in any manner adverse to the Agent or Lenders unless
required by law; (b) enter into any transaction of merger or consolidation
except, upon not less than five (5) Business Days prior written notice to Agent,
any wholly-owned Subsidiary of Borrower may be merged with or into Borrower
(PROVIDED that Borrower is the surviving entity) or any other wholly-owned
Subsidiary of Borrower (provided that, in the case of any such merger of any
Domestic Subsidiary with or into a Foreign Subsidiary, the Domestic Subsidiary
is the surviving entity); (c) liquidate, wind-up or dissolve itself (or suffer
any liquidation or dissolution); or (d) acquire by purchase or otherwise all or
any substantial part of the Stock, business or assets of any other Person.
Notwithstanding the foregoing, Borrower (or Holdings, so long as
contemporaneously therewith, all assets so acquired are transferred to Borrower
contemporaneous with the closing of such acquisition), may acquire all or
substantially all of the assets or Stock of any Person (the "TARGET") (in each
case, a "PERMITTED ACQUISITION") subject to the satisfaction of each of the
following conditions:
39
(i) Agent shall receive at least 30 Business Days' prior written notice
of such proposed Permitted Acquisition, which notice shall include a reasonably
detailed description of such proposed Permitted Acquisition;
(ii) such Permitted Acquisition shall only involve assets located in
the United States and comprising a business, or those assets of a business, of
the type engaged in by Borrower as of the Closing Date, and which business would
not subject Agent or any Lender to regulatory or third party approvals in
connection with the exercise of its rights and remedies under this Agreement or
any other Loan Documents other than approvals applicable to the exercise of such
rights and remedies with respect to Borrower prior to such Permitted
Acquisition;
(iii) such Permitted Acquisition shall be consensual and shall have
been approved by the Target's board of directors;
(iv) no additional Indebtedness, Guaranteed Indebtedness, Contingent
Obligations or other liabilities shall be incurred, assumed or otherwise be
reflected on a consolidated balance sheet of Borrower and Target after giving
effect to such Permitted Acquisition, except (A) ordinary course trade payables
and accrued expenses and (B) Indebtedness otherwise permitted under SECTION
5.1(F) or 5.1(G) of the Target not to exceed $2,000,000 in the aggregate for any
Permitted Acquisition so long as on a pro forma basis, Holdings and its
Subsidiaries would have had a Leverage Ratio and Senior Leverage Ratio of less
than or equal to the Leverage Ratio and Senior Leverage Ratio, respectively, of
Holdings and its Subsidiaries for the four quarter period ending on the last day
of the month immediately preceding the month in which such proposed Permitted
Acquisition is to be consummated (after giving effect to such Permitted
Acquisition and all Loans funded in connection therewith as if made on the first
day such period); in each case to the extent no Default or Event of Default has
occurred and is continuing or would result after giving effect to such Permitted
Acquisition;
(v) the sum of all amounts payable in connection with any Permitted
Acquisition (including the purchase price, all transaction costs and all
Indebtedness, liabilities and Contingent Obligations incurred or assumed in
connection therewith or otherwise reflected on a consolidated balance sheet of
Borrower and Target) shall not exceed $2,000,000 and the sum of such amounts
payable in connection with all Permitted Acquisitions shall not exceed
$10,000,000, and the portion thereof allocable to goodwill and intangible assets
for all such Permitted Acquisitions during the term hereof shall not exceed
$5,000,000;
(vi) unless otherwise consented to in writing by Agent, the Target
shall not have incurred an operating loss for the trailing twelve-month period
preceding the date of the Permitted Acquisition, as determined based upon the
Target's financial statements for its most recently completed fiscal year and
its most recent interim financial period completed within sixty (60) days prior
to the date of consummation of such Permitted Acquisition;
(vii) the business and assets acquired in such Permitted Acquisition
shall be free and clear of all Liens (other than Permitted Encumbrances);
40
(viii) at or prior to the closing of any Permitted Acquisition, Agent
will be granted a first priority perfected Lien (subject to Permitted
Encumbrances) in all assets acquired pursuant thereto or in the assets and Stock
of the Target, and Holdings and Borrower and the Target shall have executed such
documents and taken such actions as may be required by Agent in connection
therewith;
(ix) Concurrently with delivery of the notice referred to in CLAUSE (I)
above, Borrower shall have delivered to Agent, in form and substance reasonably
satisfactory to Agent:
(A) a pro forma consolidated balance sheet, income
statement and cash flow statement of Holdings and its Subsidiaries (the
"ACQUISITION PRO FORMA"), based on recent financial statements, which shall be
complete and shall fairly present in all material respects the assets,
liabilities, financial condition and results of operations of Holdings and its
Subsidiaries in accordance with GAAP consistently applied, but taking into
account such Permitted Acquisition and the funding of all Loans in connection
therewith, and such Acquisition Pro Forma shall reflect that (x) on a pro forma
basis, Holdings and its Subsidiaries would have had a Leverage Ratio and Senior
Leverage Ratio with a numerator (or equivalent thereof) one quarter (0.25) less
than otherwise permitted (for example, if the permitted Leverage Ratio is less
than or equal 3.00 to 1.00, Holdings and its Subsidiaries must have a Leverage
Ratio of less than or equal to 2.75 to 1.00) for the four quarter period ending
on the last day of the month immediately preceding the month in which such
proposed Permitted Acquisition is to be consummated (after giving effect to such
Permitted Acquisition and all Loans funded in connection therewith as if made on
the first day of such period), (y) average daily Borrowing Availability for the
90-day period preceding the consummation of such Permitted Acquisition would
have exceeded $5,000,000 on a pro forma basis (after giving effect to such
Permitted Acquisition and all Loans funded in connection therewith as if made on
the first day of such period) and the Acquisition Projections (as hereinafter
defined) shall reflect that such Borrowing Availability of $5,000,000 shall
continue for at least 90 days after the consummation of such Permitted
Acquisition, and (z) on a pro forma basis, no Event of Default has occurred and
is continuing or would result after giving effect to such Permitted Acquisition
and Borrower would have been in compliance with the financial covenants set
forth in SECTION 6 for the four quarter period reflected in the Compliance and
Excess Cash Flow Certificate most recently delivered to Agent pursuant to
SECTION 6.2(O) prior to the consummation of such Permitted Acquisition (after
giving effect to such Permitted Acquisition and all Loans funded in connection
therewith as if made on the first day of such period);
(B) updated versions of the most recently delivered
Projections covering the 3 year period commencing on the date of such Permitted
Acquisition and otherwise prepared in accordance with the Projections (the
"ACQUISITION PROJECTIONS") and based upon historical financial data of a recent
date reasonably satisfactory to Agent, taking into account such Permitted
Acquisition; and
(C) a certificate of the chief financial officer of
Borrower to the effect that: (w) Borrower (after taking into consideration all
rights of contribution and indemnity Borrower has against Holdings and each
other Subsidiary of Holdings) will be Solvent upon the consummation of the
Permitted Acquisition; (x) the Acquisition Pro Forma fairly presents the
financial condition of Holdings and its Subsidiaries (on a consolidated basis)
41
as of the date thereof after giving effect to the Permitted Acquisition; (y) the
Acquisition Projections are reasonable estimates of the future financial
performance of Holdings and its Subsidiaries subsequent to the date thereof
based upon the historical performance of Holdings and its Subsidiaries and the
Target and show that Holdings and its Subsidiaries shall continue to be in
compliance with the financial covenants set forth in SECTION 6 for the 3-year
period thereafter; and (z) Holdings and its Subsidiaries have completed their
due diligence investigation with respect to the Target and such Permitted
Acquisition, which investigation was conducted in a manner similar to that which
would have been conducted by a prudent purchaser of a comparable business and
the results of which investigation were delivered to Agent and Lenders;
(x) on or prior to the date of such Permitted Acquisition, Agent shall
have received, in form and substance reasonably satisfactory to Agent, copies of
the acquisition agreement and related agreements and instruments, and all
opinions, certificates, lien search results and other documents reasonably
requested by Agent, including those specified in the last sentence of SECTION
4.6; and
(xi) at the time of such Permitted Acquisition and after giving effect
thereto, no Default or Event of Default has occurred and is continuing.
DISPOSAL OF ASSETS OR SUBSIDIARY STOCK. The Credit Parties shall not and shall
not cause or permit their Subsidiaries to directly or indirectly convey, sell,
lease, sublease, transfer or otherwise dispose of, or grant any Person an option
to acquire, in one transaction or a series of related transactions, any of its
property, business or assets, whether now owned or hereafter acquired, except
for (a) sales of inventory to customers in the ordinary course of business and
dispositions of obsolete equipment not used or useful in the business; (b) any
condemnation or taking of such assets by eminent domain proceedings; and (c)
Asset Dispositions by Borrower and its Subsidiaries (excluding sales of Accounts
and Stock of any of Holdings' Subsidiaries) if all of the following conditions
are met: (i) the aggregate fair market value of assets sold or otherwise
disposed of in any Fiscal Year does not exceed $1,000,000; (ii) the
consideration received is at least equal to the fair market value of such assets
(as determined by the board of directors of the applicable Credit Party in good
faith); (iii) at least 85% of the consideration received is cash; (iv) the Net
Proceeds of such Asset Disposition are applied as required by SECTION 1.5(C);
(v) after giving effect to the Asset Disposition and the repayment of
Indebtedness with the proceeds thereof, Borrower is in compliance on a pro forma
basis with the covenants set forth in SECTION 6 recomputed for the most recently
ended quarter for which information is available; and (vi) no Event of Default
has occurred and is continuing or would result from such Asset Disposition.
TRANSACTIONS WITH AFFILIATES. The Credit Parties shall not and shall not cause
or permit their Subsidiaries to directly or indirectly enter into or permit to
exist any transaction (including the purchase, sale, lease or exchange of any
property or the rendering of any management, consulting, investment banking,
advisory or other similar services) with any Affiliate or with any director,
officer or employee of any Credit Party, except (a) as set forth on SCHEDULE
5.8, (b) transactions in the ordinary course of and pursuant to the reasonable
requirements of the business of any such Credit Party or any of its Subsidiaries
and upon fair and reasonable terms which (except in the case of transactions
42
among Domestic Credit Parties) are fully disclosed to Agent and are no less
favorable to any such Credit Party or any of its Subsidiaries than would be
obtained in a comparable arm's length transaction with a Person that is not an
Affiliate, (c) payment of reasonable compensation to officers and employees for
services actually rendered to any such Credit Party or any of its Subsidiaries;
(d) payment of director's fees not to exceed $50,000 in the aggregate for any
Fiscal Year of Holdings; (e) loans to employees permitted in SECTION 5.3, (f)
Restricted Payments permitted in SECTION 5.5 and the agreements pursuant to
which such Restricted Payments are required to be made, (g) reimbursement of
employee travel and lodging costs incurred in the ordinary course of business,
(h) the guaranty of the Obligations by Credit Parties, (i) employment
agreements, equity incentive agreements and other employee and management
arrangements in the ordinary course of business which are fully disclosed to the
Agent and (j) the guaranty of the Second Lien Loan Obligations.
CONDUCT OF BUSINESS. Holdings shall not engage in any business activity other
than its ownership of the Stock of its Subsidiaries and its performance of the
Related Transaction Documents. The Credit Parties (other than Holdings) shall
not and shall not cause or permit their Subsidiaries to directly or indirectly
engage in any business other than businesses of the type described on SCHEDULE
5.9.
CHANGES RELATING TO INDEBTEDNESS. The Credit Parties shall not and shall not
cause or permit their Subsidiaries to directly or indirectly change or amend the
terms of the Second Lien Loan Documents if such change or amendment would breach
the terms of the Intercreditor Agreement.
FISCAL YEAR. No Credit Party shall change its Fiscal Year or permit any of its
Subsidiaries to change their respective Fiscal Years.
PRESS RELEASE; PUBLIC OFFERING MATERIALS. Each Credit Party executing this
Agreement agrees that neither it nor its Affiliates will in the future issue any
press releases or other public disclosure, including any prospectus, proxy
statement or other materials filed with any Governmental Authority relating to a
public offering of the Stock of any Credit Party, using the name of GE Capital
or its affiliates or referring to this Agreement, the other Loan Documents or
the Related Transactions Documents without at least two (2) Business Days' prior
notice to GE Capital and without the prior written consent of GE Capital unless
(and only to the extent that) such Credit Party or Affiliate is required to do
so under law and then, in any event, such Credit Party or Affiliate will consult
with GE Capital before issuing such press release or other public disclosure.
SUBSIDIARIES. The Credit Parties shall not and shall not cause or permit their
Subsidiaries to directly or indirectly establish, create or acquire any new
Subsidiary, other than in connection with a Permitted Acquisition.
DEPOSIT ACCOUNTS. The Credit Parties shall not and shall not cause or permit
their Subsidiaries to establish any new deposit accounts (other than payroll,
employee benefits and other similar trust accounts) without prior written notice
to Agent and unless Agent and the bank at which the account is to be opened
enter into a Control Agreement in form and substance reasonably acceptable to
Agent.
43
HAZARDOUS MATERIALS. The Credit Parties shall not and shall not cause or permit
their Subsidiaries to cause or permit a Release of any Hazardous Material on,
at, in, under, above, to, from or about any of the Real Estate where such
Release would (a) violate in any respect, or form the basis for any
Environmental Liabilities by the Credit Parties or any of their Subsidiaries
under, any Environmental Laws or Environmental Permits or (b) otherwise
adversely impact the value or marketability of any of the Real Estate or any of
the Collateral, other than such violations or Environmental Liabilities that
could not reasonably be expected to have a Material Adverse Effect.
ERISA. The Credit Parties shall not and shall not cause or permit any ERISA
Affiliate to, cause or permit to occur an ERISA Event to the extent such ERISA
Event could reasonably be expected to have a Material Adverse Effect.
SALE-LEASEBACKS. The Credit Parties shall not and shall not cause or permit any
of their Subsidiaries to engage in any sale-leaseback, synthetic lease or
similar transaction involving any of its assets.
PREPAYMENTS OF OTHER INDEBTEDNESS. The Credit Parties shall not, directly or
indirectly, voluntarily purchase, redeem, defease or prepay any principal of,
premium, if any, interest or other amount payable in respect of any Subordinated
Debt other than (a) intercompany Indebtedness reflecting amounts owing to
Borrower, (b) as permitted in SECTION 5.5(C), and (c) the prepayment of the
Subordinated Notes with proceeds of the Incremental Term Loan C.
CHANGES TO MATERIAL CONTRACTS. The Credit Parties shall not and shall not cause
or permit any of their Subsidiaries to change or amend the terms of the
Management Agreement.
FINANCIAL COVENANTS/REPORTING
Borrower covenants and agrees that from and after the date hereof until
the Termination Date, Borrower shall perform and comply with, and shall cause
each of the other Credit Parties to perform and comply with, all covenants in
this SECTION 6 applicable to such Person.
FINANCIAL COVENANTS.
--------------------
CAPITAL EXPENDITURE LIMITS. Holdings and its Subsidiaries on a consolidated
basis shall not make Capital Expenditures during the following periods that
exceed the aggregate the amounts set forth opposite each of such periods (the
"CAPEX LIMIT"):
MAXIMUM CAPITAL
PERIOD EXPENDITURES PER PERIOD
------ -----------------------
Fiscal Year 2006 $ 8,500,000
Fiscal Year 2007 $10,000,000
Fiscal Year 2008 $11,000,000
Fiscal Year 2009 $11,000,000
Fiscal Year 2010 and each Fiscal Year thereafter $12,000,000
44
PROVIDED, HOWEVER, that commencing with Fiscal Year 2007, the Capex Limit
referenced above will be increased in any period by an amount equal to 50% of
the difference obtained by taking the Capex Limit for the immediately prior
period (excluding any Carry Over Amounts) MINUS the actual amount of any Capital
Expenditures expended during such prior period (the "CARRY OVER AMOUNT"), and
for purposes of measuring compliance herewith, the Carry Over Amount shall be
deemed to be the last amount spent on Capital Expenditures in that succeeding
period.
DAYS SALES OUTSTANDING. Holdings and its Subsidiaries shall not have Days Sales
Outstanding to exceed ninety-five (95) days as of the last day of any Fiscal
Quarter.
MINIMUM FIXED CHARGE COVERAGE RATIO. Holdings and its Subsidiaries shall have on
a consolidated basis at the end of each Fiscal Quarter set forth below, a Fixed
Charge Coverage Ratio for the 12-Fiscal Month period then ended of not less than
the following:
1.00 for each Fiscal Quarter ending on or prior to
January 31, 2007;
1.10 for the Fiscal Quarter ending after January 31,
2007 but on or prior to July 31, 2007; and
1.20 for each Fiscal Quarter ending thereafter.
INTENTIONALLY OMITTED.
MAXIMUM LEVERAGE RATIO. Holdings and its Subsidiaries on a consolidated basis
shall have, at the end of each Fiscal Quarter set forth below, a Leverage Ratio
as of the last day of such Fiscal Quarter and for the 12-Fiscal Month period
then ended, of not more than the following:
5.25 for each Fiscal Quarter ending on or prior to
January 31, 2007;
5.20 for the Fiscal Quarter ending April 30, 2007;
5.10 for the Fiscal Quarter ending July 31, 2007;
4.90 for the Fiscal Quarter ending October 31, 2007;
4.85 for the Fiscal Quarter ending January 31, 2008;
4.75 for the Fiscal Quarter ending April 30, 2008;
4.65 for the Fiscal Quarter ending July 31, 2008;
4.40 for the Fiscal Quarter ending October 31, 2008;
4.30 for the Fiscal Quarter ending January 31, 2009;
4.20 for the Fiscal Quarter ending April 30, 2009;
4.00 for the Fiscal Quarter ending July 31, 2009;
3.85 for the Fiscal Quarter ending October 31, 2009;
3.70 for the Fiscal Quarter ending January 31, 2010;
3.60 for the Fiscal Quarter ending April 30, 2010;
3.50 for the Fiscal Quarter ending July 31, 2010;
45
3.25 for each Fiscal Quarter ending after July 31, 2010
but on or prior to January 31, 2011;
3.00 for the Fiscal Quarter ending April 30, 2011;
2.75 for the Fiscal Quarter ending July 31, 2011;
2.50 for each Fiscal Quarter ending after July 31, 2011
but on or prior to January 31, 2012;
2.25 for each Fiscal Quarter ending after January 31,
2012 but on prior to July 31, 2012; and
2.00 for each Fiscal Quarter ending thereafter.
MAXIMUM SENIOR LEVERAGE RATIO. Holdings and its Subsidiaries on a consolidated
basis shall have, at the end of each Fiscal Quarter set forth below, a Senior
Leverage Ratio as of the last day of such Fiscal Quarter and for the 12-Fiscal
Month period then ended, of not more than the following:
3.00 for each Fiscal Quarter ending on or prior to
January 31, 2007
2.85 for the Fiscal Quarter ending April 30, 2007;
2.75 for the Fiscal Quarter ending July 31, 2007;
2.70 for the Fiscal Quarter ending October 31, 2007;
2.60 for the Fiscal Quarter ending January 31, 2008;
2.50 for the Fiscal Quarter ending April 30, 2008;
2.40 for the Fiscal Quarter ending July 31, 2008;
2.30 for the Fiscal Quarter ending October 31, 2008;
2.20 for the Fiscal Quarter ending January 31, 2009;
2.10 for the Fiscal Quarter ending April 30, 2009;
2.00 for the Fiscal Quarter ending July 31, 2009;
1.75 for the Fiscal Quarter ending October 31, 2009;
1.75 for each Fiscal Quarter ending after October 31,
2009 but on or prior to April 30, 2010;
1.50 for each Fiscal Quarter ending after April 30,
2010 but on prior to January 31, 2011;
1.25 for each Fiscal Quarter ending after January 31,
2011 but on prior to July 31, 2011; and
1.00 for each Fiscal Quarter ending thereafter.
FINANCIAL STATEMENTS AND OTHER REPORTS. Holdings and Borrower will maintain, and
cause each of its Subsidiaries to maintain, a system of accounting established
and administered in accordance with sound business practices to permit
preparation of Financial Statements in conformity with GAAP (it being understood
that monthly Financial Statements are not required to have footnote
disclosures). Borrower will deliver each of the Financial Statements and other
reports described below to Agent (and each Lender in the case of the Financial
Statements and other reports described in ▇▇▇▇▇▇▇▇ (▇.▇)(▇), (▇), (▇), (▇), (▇),
(▇), (▇), (▇) and (O)).
46
MONTHLY FINANCIALS AND QUARTERLY STATEMENTS.
(i) As soon as available and in any event within
forty-five (45) days after the end of each Fiscal Month (including the last
Fiscal Month of Holdings' Fiscal Year), Borrower will deliver (1) the
consolidated and consolidating balance sheets of Holdings and its Subsidiaries,
as at the end of such month, and the related consolidated and consolidating
statements of income, stockholders' equity and cash flow for such Fiscal Month
and for the period from the beginning of the then current Fiscal Year of
Holdings to the end of such Fiscal Month, (2) a report setting forth in
comparative form the corresponding figures for the corresponding periods of the
previous Fiscal Year and the corresponding figures from the most recent
Projections for the current Fiscal Year delivered pursuant to SECTION 6.2(H) and
(3) a schedule of the outstanding Indebtedness for borrowed money of Holdings
and its Subsidiaries describing in reasonable detail each such debt issue or
loan outstanding and the principal amount and amount of accrued and unpaid
interest with respect to each such debt issue or loan.
(ii) As soon as available and in any event within
forty-five (45) days after the end of each Fiscal Quarter, Borrower will deliver
unit volumes and historical net collections by major payor groups and a
consolidated statement of stockholder's equity.
YEAR-END FINANCIALS. As soon as available and in any event within ninety (90)
days (or if Holdings files an extension with the Securities & Exchange
Commission, one hundred and five (105) days; PROVIDED, that Borrower has given
Agent a written explanation within ninety (90) days after the end of the
applicable Fiscal Year of Holdings, in form and substance reasonably acceptable
to Agent, regarding the need for such extension) after the end of each Fiscal
Year of Holdings, Borrower will deliver (1) the consolidated and consolidating
balance sheets of Holdings and its Subsidiaries, as at the end of such year, and
the related consolidated and consolidating statements of income, stockholders'
equity and cash flow for such Fiscal Year, (2) a schedule of the outstanding
Indebtedness for borrowed money of Holdings and its Subsidiaries describing in
reasonable detail each such debt issue or loan outstanding and the principal
amount and amount of accrued and unpaid interest with respect to each such debt
issue or loan and (3) a report with respect to the consolidated Financial
Statements from a firm of Certified Public Accountants selected by Borrower and
reasonably acceptable to Agent, which report shall be prepared in accordance
with Statement of Auditing Standards No. 58 (the "STATEMENT") "Reports on
Audited Financial Statements" and such report shall be "Unqualified" (as such
term is defined in such Statement).
ACCOUNTANTS' REPORTS. Promptly upon receipt thereof, Borrower will deliver
copies of all significant reports submitted by Holdings' firm of certified
public accountants in connection with each annual, interim or special audit or
review of any type of the Financial Statements or related internal control
systems of Holdings or its Subsidiaries made by such accountants, including any
comment letter submitted by such accountants to management in connection with
their services.
BORROWING BASE CERTIFICATE. As soon as available and in any event within five
(5) Business Days after the end of each Fiscal Month, concurrently with the
delivery of any Notice of Revolving Credit Advance and from time to time upon
the reasonable request of Agent, Borrower will deliver a Borrowing Base
Certificate (in substantially the same form as EXHIBIT 6.2(D), the "BORROWING
BASE CERTIFICATE") as at the last day of such period.
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MANAGEMENT REPORT. Together with each delivery of Financial Statements of
Borrower pursuant to SECTIONS 6.2(A)(II) and (B), Borrower will deliver a
management report (1) describing the operations and financial condition of
Holdings and its Subsidiaries for the Fiscal Month then ended and the portion of
the current Fiscal Quarter then elapsed (or for the Fiscal Year then ended in
the case of year-end financials) and (2) discussing the reasons for any
significant variations. The information above shall be presented in reasonable
detail and shall be certified by the chief financial officer of Holdings to the
effect that such information fairly presents the results of operations and
financial condition of Holdings Borrower and its Subsidiaries as at the dates
and for the periods indicated.
[INTENTIONALLY OMITTED.]
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APPRAISALS. From time to time, if Agent or any Lender determines that obtaining
appraisals is necessary in order for Agent or such Lender to comply with
applicable laws or regulations, Agent will, at Borrower's expense, obtain
appraisal reports in form and substance and from appraisers reasonably
satisfactory to Agent stating the then current fair market values of all or any
portion of the Real Estate owned by Credit Parties. In addition to the
foregoing, at Borrower's expense, at any time while and so long as an Event of
Default shall have occurred and be continuing, and in the absence of a Default
or Event of Default not more than once during each calendar year, Agent may
obtain appraisal reports in form and substance and from appraisers satisfactory
to Agent stating the then current market values of all or any portion of the
Real Estate and personal property owned by any of the Credit Parties.
PROJECTIONS. As soon as available and in any event no later than the last day of
each of Holdings' Fiscal Years, Borrower will deliver Projections of Holdings
and its Subsidiaries for the forthcoming three (3) Fiscal Years, year by year,
and for the forthcoming Fiscal Year, Fiscal Month by Fiscal Month.
SEC FILINGS AND PRESS RELEASES. Promptly upon their becoming available, Borrower
will deliver copies of (1) all Financial Statements, reports, notices and proxy
statements, material reports and material notices sent or made available by
Holdings or any of their Subsidiaries to their Stockholders, (2) all regular and
periodic reports and all registration statements and prospectuses, if any, filed
by Holdings or any of their Subsidiaries with any securities exchange or with
the Securities and Exchange Commission, any Governmental Authority or any
private regulatory authority, and (3) all press releases and other statements
made available by Holdings or any of its Subsidiaries to the public concerning
developments in the business of any such Person.
EVENTS OF DEFAULT, Etc. Promptly upon any officer of any Credit Party obtaining
knowledge of any of the following events or conditions, Borrower shall deliver
copies of all notices given or received by Holdings or any of its Subsidiaries
with respect to any such event or condition and a certificate of Borrower's
chief executive officer specifying the nature and period of existence of such
event or condition and what action Holdings or any of its Subsidiaries has
taken, is taking and proposes to take with respect thereto: (1) any condition or
event that constitutes, or which could reasonably be expected to result in the
occurrence of, an Event of Default or Default; (2) any notice that any Person
has given to Borrower or any of its Subsidiaries or any other action taken with
respect to a claimed default or event or condition of the type referred to in
SECTION 7.1(B); or (3) any event or condition that could reasonably be expected
to result in any Material Adverse Effect.
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LITIGATION. Promptly upon any officer of any Credit Party obtaining knowledge of
(1) the institution of any action, charge, claim, demand, suit, proceeding,
petition, governmental investigation, tax audit or arbitration now pending or,
to the best knowledge of such Credit Party after due inquiry, threatened against
or affecting any Credit Party or any of its Subsidiaries or any property of any
Credit Party or any of its Subsidiaries ("LITIGATION") not previously disclosed
by Borrower to Agent or (2) any material development in any action, suit,
proceeding, governmental investigation or arbitration at any time pending
against or affecting any Credit Party or any property of any Credit Party which,
in each case, would reasonably be expected to have a Material Adverse Effect,
Borrower will promptly give notice thereof to Agent and provide such other
information as may be reasonably available to them to enable Agent and its
counsel to evaluate such matter.
NOTICE OF CORPORATE AND OTHER CHANGES. Borrower shall provide prompt written
notice of (1) all jurisdictions in which a Credit Party becomes qualified after
the Closing Date to transact business, (2) any change after the Closing Date in
the authorized and issued Stock of any Credit Party or any amendment to their
articles or certificate of incorporation, by-laws, partnership agreement or
other organizational documents, (3) any Subsidiary created or acquired by any
Credit Party or any of its Subsidiaries after the Closing Date, such notice, in
each case, to identify the applicable jurisdictions, capital structures or
Subsidiaries, as applicable, and (4) any other event that occurs after the
Closing Date which would cause any of the representations and warranties in
SECTION 3 of this Agreement or in any other Loan Document to be untrue or
misleading in any material respect. The foregoing notice requirement shall not
be construed to constitute consent by any of the Lenders to any transaction
referred to above which is not expressly permitted by the terms of this
Agreement.
SECOND LIEN CREDIT AGREEMENT NOTICES. Borrower shall deliver within five (5)
Business Days after (i) delivery thereof, copies of all notices, certificates
and other documents or reports delivered by Borrower or on its behalf to the
Second Lien Agent and (ii) receipt thereof, copies of all notices delivered by
Second Lien Agent to Borrower.
OTHER INFORMATION. With reasonable promptness, Borrower will deliver such other
information and data with respect to any Credit Party or any Subsidiary of any
Credit Party as from time to time may be reasonably requested by Agent.
COMPLIANCE AND EXCESS CASH FLOW CERTIFICATE. Together with each delivery of
Financial Statements pursuant to SECTION 6.2(A) for the last month of each
Fiscal Quarter and SECTION 6.2(B), Borrower will deliver a fully and properly
completed Compliance and Excess Cash Flow Certificate (in substantially the same
form as ANNEX F (the "COMPLIANCE AND EXCESS CASH FLOW CERTIFICATE") signed by
Borrower's chief executive officer or chief financial officer; provided that the
Excess Cash Flow portion of such certificate is only required to be delivered
annually; provided that Schedule 2 of the Compliance and Excess Cash Flow
certificate shall be delivered only in connection with the Financial Statements
of Borrower and its Subsidiaries delivered pursuant to Section 6.2(b).
49
TAXES. Borrower shall provide prompt written notice of (i) the execution or
filing with the IRS or any other Governmental Authority of any agreement or
other document extending, or having the effect of extending, the period for
assessment or collection of any Charges by any Credit Party or any of its
Subsidiaries and (ii) any agreement by any Credit Party or any of its
Subsidiaries or request directed to any Credit Party or any of its Subsidiaries
to make any adjustment under IRC Section 481(a), by reason of a change in
accounting method or otherwise, which could reasonably be expected to have a
Material Adverse Effect.
ERISA. With reasonable promptness, Borrower shall provide to Agent copies of the
most recent actuarial reports with respect to any Title IV Plans as they become
available. Promptly upon any Credit Party becoming aware of any fact or
condition which could reasonably be expected to result in an ERISA Event,
Borrower shall deliver to Agent a summary of such facts and circumstances and
any action the Credit Parties intend to take regarding such facts or conditions.
ACCOUNTING TERMS; UTILIZATION OF GAAP FOR PURPOSES OF CALCULATIONS UNDER
AGREEMENT. For purposes of this Agreement, all accounting terms not otherwise
defined herein shall have the meanings assigned to such terms in conformity with
GAAP. Financial statements and other information furnished to Agent pursuant to
SECTION 6.2 or any other section (unless specifically indicated otherwise) shall
be prepared in accordance with GAAP as in effect at the time of such
preparation; PROVIDED that no Accounting Change shall affect financial
covenants, standards or terms in this Agreement; PROVIDED further that Borrower
shall prepare footnotes to the Financial Statements required to be delivered
hereunder that show the differences between the Financial Statements delivered
(which reflect such Accounting Changes) and the basis for calculating financial
covenant compliance (without reflecting such Accounting Changes). All such
adjustments described in clause (c) of the definition of the term Accounting
Changes resulting from expenditures made subsequent to the Closing Date
(including capitalization of costs and expenses or payment of pre-Closing Date
liabilities) shall be treated as expenses in the period the expenditures are
made. Notwithstanding the foregoing, in the event that any Accounting Change
shall occur and such change results in a change in the method of calculation of
the financial covenants, standards or terms in this Agreement, then Borrower and
Agent agree to negotiate in good faith in order to amend such provisions of this
Agreement so as to equitably reflect such Accounting Changes with the desired
result that the criteria for evaluating the financial condition of the Credit
Parties shall be the same after such Accounting Changes as if such Accounting
Changes had not been made. Until such time as such an amendment shall have been
executed and delivered by Borrower, Agent and the Requisite Lenders, all
financial covenants, standards and terms in this Agreement shall continue to be
calculated or construed as if such Accounting Changes had not occurred.
DEFAULT, RIGHTS AND REMEDIES
EVENT OF DEFAULT. "EVENT OF DEFAULT" shall mean the occurrence or existence of
any one or more of the following:
PAYMENT. (1) Failure to pay any installment or other payment of principal of any
Loan when due, or to timely repay Revolving Loans to reduce their balance to the
maximum amount of Revolving Loans then permitted to be outstanding in accordance
with SECTION 1.1(B)(I) or to reimburse any L/C Issuer for any payment made by
such L/C Issuer under or in respect of any Letter of Credit when due or (2)
50
failure to pay, within three (3) days after the due date, any interest or Fees
on any Loan or any other amount due under this Agreement or any of the other
Loan Documents; or
DEFAULT IN OTHER AGREEMENTS. (1) Any Credit Party or any of its Subsidiaries
fails to pay when due or within any applicable grace period any principal or
interest on Indebtedness (other than the Loans) or any Contingent Obligations or
(2) breach or default of any Credit Party or any of its Subsidiaries, or the
occurrence of any condition or event, with respect to any Indebtedness (other
than the Loans) or any Contingent Obligations, if the effect of such breach,
default or occurrence is to cause or to permit the holder or holders then to
cause, Indebtedness and/or Contingent Obligations having an individual principal
amount in excess of $500,000 or having an aggregate principal amount in excess
of $1,000,000 to become or be declared due prior to their stated maturity; or
BREACH OF CERTAIN PROVISIONS. Failure of any Credit Party to perform or comply
with any term or condition contained in (1) the GE Capital Fee Letter, (2)
SECTION 6.2 which failure continues for more than five (5) Business Days after
the date specified for performance or compliance with such term or condition,
(3) that portion of SECTION 4.2 relating to the Credit Parties' obligation to
maintain insurance, or (4) SECTION 4.3, SECTION 4.4, SECTION 5 or SECTION 6.1;
or
BREACH OF WARRANTY. Any representation, warranty, certification or other
statement made by any Credit Party in any Loan Document or in any statement or
certificate at any time given by such Person in writing pursuant or in
connection with any Loan Document is false in any material respect (without
duplication of materiality qualifiers contained therein) on the date made; or
OTHER DEFAULTS UNDER LOAN DOCUMENTS. Any Credit Party defaults in the
performance of or compliance with any term contained in this Agreement or the
other Loan Documents (other than occurrences described in other provisions of
this SECTION 7.1 for which a different grace or cure period is specified, or for
which no cure period is specified and which constitute immediate Events of
Default) and such default is not remedied or waived within thirty (30) days
after the earlier of (1) receipt by Borrower of notice from Agent or Requisite
Lenders of such default or (2) actual knowledge of Borrower or any other Credit
Party of such default; or
INVOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC. (1) A court enters a
decree or order for relief with respect to any Credit Party in an involuntary
case under the Bankruptcy Code, which decree or order is not stayed or other
similar relief is not granted under any applicable federal or state law; or (2)
the continuance of any of the following events for sixty (60) days unless
dismissed, bonded or discharged: (a) an involuntary case is commenced against
any Credit Party, under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect; or (b) a decree or order of a court for the
appointment of a receiver, liquidator, sequestrator, trustee, custodian or other
officer having similar powers over any Credit Party, or over all or a
substantial part of its property, is entered; or (c) a receiver, trustee or
other custodian is appointed without the consent of a Credit Party, for all or a
substantial part of the property of the Credit Party; or
51
VOLUNTARY BANKRUPTCY; APPOINTMENT OF RECEIVER, ETC. (1) any Credit Party
commences a voluntary case under the Bankruptcy Code, or consents to the entry
of an order for relief in an involuntary case or to the conversion of an
involuntary case to a voluntary case under any such law or consents to the
appointment of or taking possession by a receiver, trustee or other custodian
for all or a substantial part of its property; or (2) any Credit Party makes any
assignment for the benefit of creditors; or (3) the Board of Directors of any
Credit Party adopts any resolution or otherwise authorizes action to approve any
of the actions referred to in this SECTION 7.1(G); or
JUDGMENT AND ATTACHMENTS. Any money judgment, writ or warrant of attachment, or
similar process (other than those described elsewhere in this SECTION 7.1)
involving (1) an amount in any individual case in excess of $250,000 or (2) an
amount in the aggregate at any time in excess of $500,000 (in either case to the
extent not adequately covered by insurance in Agent's sole discretion as to
which the insurance company has acknowledged coverage) is entered or filed
against one or more of the Credit Parties or any of their respective assets and
remains undischarged, unvacated, unbonded or unstayed for a period of thirty
(30) days or in any event later than five (5) Business Days prior to the date of
any proposed sale thereunder; or
DISSOLUTION. Any order, judgment or decree is entered against any Credit Party
decreeing the dissolution or split up of such Credit Party and such order
remains undischarged or unstayed for a period in excess of fifteen (15) days; or
SOLVENCY. Borrower ceases to be Solvent, the Credit Parties and their
Subsidiaries, taken as a whole, cease to be Solvent, or any Credit Party fails
to pay its debts as they become due or admits in writing its present or
prospective inability to pay its debts as they become due; or
INVALIDITY OF LOAN DOCUMENTS. Any of the Loan Documents for any reason, other
than a partial or full release in accordance with the terms thereof, ceases to
be in full force and effect or is declared to be null and void, or any Credit
Party denies that it has any further liability under any Loan Documents to which
it is party, or gives notice to such effect; or
DAMAGE; CASUALTY. Any event occurs, whether or not insured or insurable, as a
result of which revenue-producing activities cease or are substantially
curtailed at any facility of any Credit Party generating more than 5% of the
consolidated revenues of the Credit Parties for the Fiscal Year preceding such
event and such cessation or curtailment continues for more than 15 days; or
CHANGE OF CONTROL. A Change of Control occurs;
SUBORDINATED INDEBTEDNESS. The failure of any Credit Party or any creditor of
Borrower or any of its Subsidiaries to comply with the terms of any
subordination or intercreditor agreement applicable to the Subordinated Notes;
or
INVALIDITY OF INTERCREDITOR AGREEMENT. The Liens securing the Second Lien Loan
Obligations cease to be subordinated to the Liens securing the Obligations in
the manner contemplated by the Intercreditor Agreement, the Intercreditor
Agreement for any reason ceases to be in full force and effect, is declared to
be null and void or any "Second Lien Secured Creditor" (as defined therein)
claims that is not bound thereby or give notice to such effect.
52
SUSPENSION OR TERMINATION OF COMMITMENTS. Upon the occurrence of any Default or
Event of Default, Agent may, and at the request of Requisite Revolving Lenders
Agent shall, without notice or demand, immediately suspend or terminate all or
any portion of Lenders' obligations to make additional Advances or issue or
cause to be issued Letters of Credit under the Revolving Loan Commitment;
PROVIDED that, in the case of a Default, if the subject condition or event is
waived by Requisite Revolving Lenders or cured within any applicable grace or
cure period, the Revolving Loan Commitment shall be reinstated.
ACCELERATION AND OTHER REMEDIES. Upon the occurrence of any Event of Default
described in SECTIONS 7.1(F) or 7.1(G), the Commitments shall be immediately
terminated and all of the Obligations, including the Revolving Loans, shall
automatically become immediately due and payable, without presentment, demand,
protest, notice of intent to accelerate, notice of acceleration or other
requirements of any kind, all of which are hereby expressly waived by Borrower,
and the Commitments shall thereupon terminate. Upon the occurrence and during
the continuance of any other Event of Default, Agent may, and at the request of
the Requisite Lenders, Agent shall, by written notice to Borrower (a) reduce the
aggregate amount of the Commitments from time to time, (b) declare all or any
portion of the Loans and all or any portion of the other Obligations to be, and
the same shall forthwith become, immediately due and payable together with
accrued interest thereon, (c) terminate all or any portion of the obligations of
Agent, L/C Issuers and Lenders to make Revolving Credit Advances and issue
Letters of Credit, (d) demand that Borrower immediately deliver to Agent either
(i) cash for the benefit of L/C Issuers (and Borrower shall then immediately so
deliver) in an amount equal to 105% of the aggregate outstanding Letter of
Credit Obligations or (ii) an Acceptable Standby Letter of credit for the
benefit of the L/C Issuers (and Borrower shall then immediately so deliver), and
(e) exercise any other remedies which may be available under the Loan Documents
or applicable law. Borrower hereby grants to Agent, for the benefit of L/C
Issuers and each Lender with a participation in any Letters of Credit then
outstanding, a security interest in such cash collateral or Acceptable Standby
Letter of Credit to secure all of the Letter of Credit Obligations. Any such
cash collateral or Acceptable Standby Letter of Credit shall be made available
by Agent to L/C Issuers to reimburse L/C Issuers for payments of drafts drawn
under such Letters of Credit and any Fees, Charges and expenses of L/C Issuers
with respect to such Letters of Credit and the unused portion thereof, after all
such Letters of Credit shall have expired or been fully drawn upon, shall be
applied to pay any other Obligations. After all such Letters of Credit shall
have expired or been fully drawn upon and the Termination Date shall have
occurred, the balance, if any, of such cash collateral or Acceptable Standby
Letter of Credit shall be (subject to any rights of third parties and except as
otherwise directed by a court of competent jurisdiction) returned to Borrower.
Borrower shall from time to time execute and deliver to Agent such further
documents and instruments as Agent may reasonably request with respect to such
cash collateral.
PERFORMANCE BY AGENT. If any Credit Party shall fail to perform any covenant,
duty or agreement contained in any of the Loan Documents which failure
constitutes an Event of Default, Agent may perform or attempt to perform such
covenant, duty or agreement on behalf of such Credit Party after the expiration
of any cure or grace periods set forth herein. In such event, such Credit Party
shall, at the request of Agent, promptly pay any amount reasonably expended by
Agent in such performance or attempted performance to Agent, together with
interest thereon at the highest rate of interest in effect upon the occurrence
of an Event of Default as specified in SECTION 1.2(D) from the date of such
expenditure until paid. Notwithstanding the foregoing, it is expressly agreed
that Agent shall not have any liability or responsibility for the performance of
any obligation of any Credit Party under this Agreement or any other Loan
Document.
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APPLICATION OF PROCEEDS. Notwithstanding anything to the contrary contained in
this Agreement, upon the occurrence and during the continuance of an Event of
Default, Borrower irrevocably waives the right to direct the application of any
and all payments at any time or times thereafter received by Agent from or on
behalf of Borrower, and Agent shall have the continuing and exclusive right to
apply and to reapply any and all payments received at any time or times after
the occurrence and during the continuance of an Event of Default.
Notwithstanding anything to the contrary contained in this Agreement (including,
without limitation, SECTION 1.1 and SECTION 1.5 hereof), all payments (including
the proceeds of any Asset Disposition or other sale of, or other realization
upon, all or any part of the Collateral) received after acceleration of the
Obligations shall be applied as follows: FIRST, to all costs and expenses
incurred by or owing to Agent and any Lender with respect to this Agreement, the
other Loan Documents or the Collateral; SECOND, to accrued and unpaid interest
and Fees with respect to the Obligations (including any interest which but for
the provisions of the Bankruptcy Code, would have accrued on such amounts);
THIRD, to the principal amount of the Obligations outstanding (including Swap
Reimbursement Obligations but excluding Obligations owed to any Lender under an
Interest Rate Agreement) and to cash collateralize outstanding Letters of Credit
(pro rata among all such Obligations (based upon the principal amount thereof or
the outstanding face amount of such Letters of Credit, as applicable) (and with
respect to amounts applied to Term Loan B, pro rata among all remaining
Scheduled Installments thereof); and FOURTH to any other obligations of Borrower
owing to Agent or any Lender under the Loan Documents or any Interest Rate
Agreement. Any balance remaining shall be delivered to Borrower or to whomever
may be lawfully entitled to receive such balance or as a court of competent
jurisdiction may direct.
ASSIGNMENT AND PARTICIPATION
ASSIGNMENTS AND PARTICIPATIONS; BINDING EFFECT.
-----------------------------------------------
BINDING EFFECT. This Agreement shall become effective when it shall have been
executed by Credit Parties and the Agent and when the Agent shall have been
notified by each Lender and L/C Issuer that such Lender or L/C Issuer has
executed it. Thereafter, it shall be binding upon and inure to the benefit of,
but only to the benefit of, each Credit Party (in each case except for SECTION
8.2), the Agent, each Lender and L/C Issuer and, to the extent provided in
SECTION 8.2, each other Indemnitee and Secured Party and, in each case, their
respective successors and permitted assigns. Except as expressly provided in any
Loan Document (including in SECTION 8.2), no Credit Party, any L/C Issuer or the
Agent shall have the right to assign any rights or obligations hereunder or any
interest herein.
RIGHT TO ASSIGN. Each Lender may sell or assign all or a portion of its rights
and obligations hereunder (including all or a portion of its Commitments and its
rights and obligations with respect to Loans and Letters of Credit) to (i) any
existing Lender, (ii) any Affiliate or Approved Fund of any existing Lender or
(iii) any other Person acceptable (which acceptance shall not be unreasonably
withheld or delayed) to the Agent and, as long as no Event of Default is
continuing, the Borrower; PROVIDED, HOWEVER, that (x) such sales and assignments
do not have to be ratable between the Facilities but must be ratable among the
obligations owing to and owed by such Lender with respect to a Facility and (y)
for each Facility, the aggregate outstanding principal amount (determined as of
54
the effective date of the applicable Assignment Agreement) of the Loans,
Commitments and Letter of Credit subject to any such sale or assignment shall be
an integral multiple of $1,000,000, unless such sale or assignment is made to an
existing Lender or an Affiliate or Approved Fund of any existing Lender, is of
the assignor's (together with its Affiliates and Approved Funds) entire interest
in such Facility or is made with the prior consent of the Borrower and the
Agent; PROVIDED, FURTHER, HOWEVER that no Lender may sell or assign all or a
portion of its rights hereunder to any Person who is a Credit Party or who to
the actual knowledge of such Lender at the time of the contemplated assignment
is an Affiliate of any Credit Party.
PROCEDURE. The parties to each sale or assignment made in reliance on CLAUSE (B)
above (other than those described in CLAUSE (E) or (F) below) shall execute and
deliver to the Agent (which shall keep a copy thereof) an Assignment Agreement,
together with any existing Note subject to such sale or assignment (or any
affidavit of loss therefor acceptable to the Agent and the Borrower), any tax
forms required to be delivered pursuant to SECTION 1.9 and payment by the
assignee of an assignment fee in the amount of $3,500; PROVIDED, however, that
no assignment fee shall be due in connection with an assignment by a Lender to
an existing Lender, an Affiliate of such Lender or an Approved Fund. Each
assigning Lender shall provide notice of each such assignment to Borrower and
Borrower shall update its records to properly reflect such assignment. Upon
receipt of all the foregoing, and conditioned upon such receipt and upon the
Agent consenting to such Assignment Agreement, from and after the effective date
specified in such Assignment Agreement, the Agent shall record or cause to be
recorded in the Loan Account the information contained in such Assignment
Agreement; PROVIDED, however, that that consent of the Agent shall not be
required in connection with an assignment by a Lender to an existing Lender, an
Affiliate of such Lender or an Approved Fund.
EFFECTIVENESS. Effective upon the entry of such record in the Loan Account, (i)
such assignee shall become a party hereto and, to the extent that rights and
obligations under the Loan Documents have been assigned to such assignee
pursuant to such Assignment Agreement, shall have the rights and obligations of
a Lender, (ii) any applicable Note shall be transferred to such assignee through
such entry and (iii) the assignor thereunder shall, to the extent that rights
and obligations under this Agreement have been assigned by it pursuant to such
Assignment Agreement, relinquish its rights (except for those surviving the
termination of the Commitments and the payment in full of the Obligations) and
be released from its obligations under the Loan Documents, other than those
relating to events or circumstances occurring prior to such assignment (and, in
the case of an Assignment Agreement covering all or the remaining portion of an
assigning Lender's rights and obligations under the Loan Documents, such Lender
shall cease to be a party hereto except that each Lender agrees to remain bound
by SECTION 8.2, SECTION 8.3 to the extent provided in SECTION 8.2(N) and SECTION
9.13).
GRANT OF SECURITY INTERESTS. In addition to the other rights provided in this
SECTION 8.1, each Lender may grant a security interest in, or otherwise assign
as collateral, any of its rights under this Agreement, whether now owned or
hereafter acquired (including rights to payments of principal or interest on the
Loans), to (A) any federal reserve bank (pursuant to Regulation A of the Federal
Reserve Board) or other funding source in support of borrowings made by such
Lender from such Person, without notice to the Agent or (B) any holder of, or
trustee for the benefit of the holders of, such Lender's Securities by notice to
the Agent; PROVIDED, HOWEVER, that no such holder or trustee, whether because of
55
such grant or assignment or any foreclosure thereon (unless such foreclosure is
made through an assignment in accordance with CLAUSE (B) above), shall be
entitled to any rights of such Lender hereunder and no such Lender shall be
relieved of any of its obligations hereunder.
PARTICIPANTS AND SPVS. In addition to the other rights provided in this SECTION
8.1, each Lender may, (x) with notice to the Agent, grant to an SPV, organized,
administered or managed by such Lender, the option to make all or any part of
any Loan that such Lender would otherwise be required to make hereunder (and the
exercise of such option by such SPV and the making of Loans pursuant thereto
shall satisfy the obligation of such Lender to make such Loans hereunder) and
such SPV may assign to such Lender the right to receive payment with respect to
any Obligation and (y) without notice to or consent from the Agent or the
Borrower, sell participations to one or more Persons in or to all or a portion
of its rights and obligations under the Loan Documents (including all its rights
and obligations with respect to the Term Loan, Revolving Loans and Letters of
Credit); PROVIDED, HOWEVER, that, whether as a result of any term of any Loan
Document or of such grant or participation, (i) no such SPV or participant shall
have a commitment, or be deemed to have made an offer to commit, to make Loans
hereunder, and, except as provided in the applicable option agreement, none
shall be liable for any obligation of such Lender hereunder, (ii) if any such
SPV or participant elects not to exercise its option to fund or otherwise fails
to provide all or any part of a Loan, the Lender granting such option or
participation shall be obligated to make such Loan pursuant to the terms hereof,
(iii) such Lender's rights and obligations, and the rights and obligations of
the Credit Parties and the Secured Parties towards such Lender, under any Loan
Document shall remain unchanged and each other party hereto shall continue to
deal solely with such Lender, which shall remain the holder of the Obligations
in the Loan Account, except that (A) each such participant and SPV shall be
entitled to the benefit of SECTIONS 1.8 and SECTION 1.9, but only to the extent
such participant or SPV delivers the tax forms such Lender is required to
collect pursuant to SECTION 1.9 and then only to the extent of any amount to
which such Lender would be entitled in the absence of any such grant or
participation and (B) each such SPV may receive other payments that would
otherwise be made to such Lender pursuant to the terms hereof with respect to
Loans funded by such SPV to the extent provided in the applicable option
agreement and set forth in a notice provided to the Agent by such SPV and such
Lender, PROVIDED, HOWEVER, that in no case (including pursuant to CLAUSE (A) or
(B) above) shall an SPV or participant have the right to enforce any of the
terms of any Loan Document and (iv) the consent of such SPV or participant shall
not be required (either directly, as a restraint on such Lender's ability to
consent hereunder or otherwise) for any amendments, waivers or consents with
respect to any Loan Document or to exercise or refrain from exercising any
powers or rights such Lender may have under or in respect of the Loan Documents
(including the right to enforce or direct enforcement of the Obligations),
except for those described in SECTIONS 9.2(C)(II) and (C)(III) with respect to
amounts, or dates fixed for payment of amounts, to which such participant or SPV
would otherwise be entitled and, in the case of participants, except for
releases of all or substantially all of the Collateral (other than in accordance
with this Agreement and the other Loan Documents). No party hereto shall
institute against any SPV grantee of an option pursuant to this clause (f) any
bankruptcy, reorganization, insolvency, liquidation or similar proceeding, prior
to the date that is one year and one day after the payment in full of all
outstanding commercial paper of such SPV; provided, however, that each Lender
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having designated an SPV as such agrees to indemnify each Indemnitee against any
Liability that may be incurred by, or asserted against, such Indemnitee as a
result of failing to institute such proceeding (including a failure to get
reimbursed by such SPV for any such Liability). The agreement in the preceding
sentence shall survive the termination of the Commitments and the payment in
full of the Obligations.
Nothing contained in this SECTION 8 shall require the consent of any party for
GE Capital to assign any of its rights in respect of any Swap Related
Reimbursement Obligation.
AGENT.
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APPOINTMENT. Each Lender hereby designates and appoints GE Capital as its Agent
under this Agreement and the other Loan Documents, and each Lender hereby
irrevocably authorizes Agent to execute and deliver the Collateral Documents and
to take such action or to refrain from taking such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers as are set forth herein or therein, together with such other powers
as are reasonably incidental thereto. Agent is authorized and empowered to
amend, modify, or waive any provisions of this Agreement or the other Loan
Documents on behalf of Lenders subject to the requirement that certain of
Lenders' consent be obtained in certain instances as provided in this SECTION
8.2 and SECTION 9.2. The provisions of this SECTION 8.2 are solely for the
benefit of Agent and Lenders and neither Borrower nor any other Credit Party
shall have any rights as a third party beneficiary of any of the provisions
hereof. In performing its functions and duties under this Agreement, Agent shall
act solely as agent of Lenders and does not assume and shall not be deemed to
have assumed any obligation toward or relationship of agency or trust with or
for Borrower or any other Credit Party. Agent may perform any of its duties
hereunder, or under the Loan Documents, by or through its agents or employees.
NATURE OF DUTIES. The duties of Agent shall be mechanical and administrative in
nature. Agent shall not have by reason of this Agreement a fiduciary
relationship in respect of any Lender. Nothing in this Agreement or any of the
Loan Documents, express or implied, is intended to or shall be construed to
impose upon Agent any obligations in respect of this Agreement or any of the
Loan Documents except as expressly set forth herein or therein. Each Lender
shall make its own independent investigation of the financial condition and
affairs of each Credit Party in connection with the extension of credit
hereunder and shall make its own appraisal of the creditworthiness of each
Credit Party, and Agent shall have no duty or responsibility, either initially
or on a continuing basis, to provide any Lender with any credit or other
information with respect thereto (other than as expressly required herein). If
Agent seeks the consent or approval of any Lenders to the taking or refraining
from taking any action hereunder, then Agent shall send notice thereof to each
Lender. Agent shall promptly notify each Lender any time that the Requisite
Lenders, Requisite Revolving Lenders or Supermajority Revolving Lenders have
instructed Agent to act or refrain from acting pursuant hereto.
RIGHTS, EXCULPATION, ETC. Neither Agent nor any of its officers, directors,
employees or agents shall be liable to any Lender for any action taken or
omitted by them hereunder or under any of the Loan Documents, or in connection
herewith or therewith, except that Agent shall be liable to the extent of its
own gross negligence or willful misconduct as determined by a final
non-appealable order by a court of competent jurisdiction. Agent shall not be
liable for any apportionment or distribution of payments made by it in good
faith and if any such apportionment or distribution is subsequently determined
to have been made in error the sole recourse of any Lender to whom payment was
due but not made, shall be to recover from other Lenders any payment in excess
57
of the amount to which they are determined to be entitled (and such other
Lenders hereby agree to return to such Lender any such erroneous payments
received by them). In no event shall Agent be liable for punitive, special,
consequential, incidental, exemplary or other similar damages. In performing its
functions and duties hereunder, Agent shall exercise the same care which it
would in dealing with loans for its own account, but neither Agent nor any of
its agents or representatives shall be responsible to any Lender for any
recitals, statements, representations or warranties herein or for the execution,
effectiveness, genuineness, validity, enforceability, collectibility, or
sufficiency of this Agreement or any of the Loan Documents or the transactions
contemplated thereby, or for the financial condition of any Credit Party. Agent
shall not be required to make any inquiry concerning either the performance or
observance of any of the terms, provisions or conditions of this Agreement or
any of the Loan Documents or the financial condition of any Credit Party, or the
existence or possible existence of any Default or Event of Default. Agent may at
any time request instructions from Requisite Lenders, Requisite Revolving
Lenders, Supermajority Revolving Lenders or all affected Lenders with respect to
any actions or approvals which by the terms of this Agreement or of any of the
Loan Documents Agent is permitted or required to take or to grant. If such
instructions are promptly requested, Agent shall be absolutely entitled to
refrain from taking any action or to withhold any approval and shall not be
under any liability whatsoever to any Person for refraining from any action or
withholding any approval under any of the Loan Documents until it shall have
received such instructions from the Requisite Lenders, Requisite Revolving
Lenders, Supermajority Revolving Lenders or such other portion of the Lenders as
shall be prescribed by this Agreement. Without limiting the foregoing, no Lender
shall have any right of action whatsoever against Agent as a result of Agent
acting or refraining from acting under this Agreement or any of the other Loan
Documents in accordance with the instructions of Requisite Lenders, Requisite
Revolving Lenders, Supermajority Revolving Lenders or all affected Lenders, as
applicable; and, notwithstanding the instructions of Requisite Lenders,
Requisite Revolving Lenders, Supermajority Revolving Lenders or all affected
Lenders, as applicable, Agent shall have no obligation to take any action if it
believes, in good faith, that such action is deemed to be illegal by Agent or
exposes Agent to any liability for which it has not received satisfactory
indemnification in accordance with SECTION 8.2(E).
RELIANCE. Agent shall be entitled to rely, and shall be fully protected in
relying, upon any written or oral notices, statements, certificates, orders or
other documents or any telephone message or other communication (including any
writing, telex, fax or telegram) believed by it in good faith to be genuine and
correct and to have been signed, sent or made by the proper Person, and with
respect to all matters pertaining to this Agreement or any of the Loan Documents
and its duties hereunder or thereunder. Agent shall be entitled to rely upon the
advice of legal counsel, independent accountants, and other experts selected by
Agent in its sole discretion.
INDEMNIFICATION. Lenders will reimburse and indemnify Agent for and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including, without limitation, attorneys'
fees and expenses), advances or disbursements of any kind or nature whatsoever
which may be imposed on, incurred by, or asserted against Agent in its capacity
as such in any way relating to or arising out of this Agreement or any of the
Loan Documents or any action taken or omitted by Agent in its capacity as such
in under this Agreement or any of the Loan Documents, in proportion to each
Lender's Pro Rata Share, but only to the extent that any of the foregoing is not
reimbursed by Borrower; provided, however, that no Lender shall be liable for
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any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, advances or disbursements to the
extent resulting from Agent's gross negligence or willful misconduct as
determined by a final non-appealable order by a court of competent jurisdiction.
If any indemnity furnished to Agent for any purpose shall, in the opinion of
Agent, be insufficient or become impaired, Agent may call for additional
indemnity and cease, or not commence, to do the acts indemnified against even if
so directed by the Requisite Lenders, Requisite Revolving Lenders, Supermajority
Revolving Lenders or such other portion of the Lenders as shall be prescribed by
this Agreement until such additional indemnity is furnished. The obligations of
Lenders under this SECTION 8.2(E) shall survive the payment in full of the
Obligations and the termination of this Agreement.
GE CAPITAL (OR ANY SUCCESSOR AGENT) INDIVIDUALLY. With respect to its
Commitments hereunder, GE Capital (or any successor Agent) shall have and may
exercise the same rights and powers hereunder and is subject to the same
obligations and liabilities as and to the extent set forth herein for any other
Lender. The terms "Lenders," "Requisite Lenders," "Requisite Revolving Lenders,"
"Supermajority Revolving Lenders" or any similar terms shall, unless the context
clearly otherwise indicates, include GE Capital (or any successor Agent) in its
individual capacity as a Lender or one of the Requisite Lenders, Requisite
Revolving Lenders or Supermajority Revolving Lenders. GE Capital (or any
successor Agent), either directly or through strategic affiliations, may lend
money to, acquire equity or other ownership interests in, provide advisory
services to and generally engage in any kind of banking, trust or other business
with any Credit Party as if it were not acting as Agent pursuant hereto and
without any duty to account therefor to Lenders. GE Capital (or any successor
Agent), either directly or through strategic affiliations, may accept fees and
other consideration from any Credit Party for services in connection with this
Agreement or otherwise without having to account for the same to Lenders.
SUCCESSOR AGENT.
----------------
RESIGNATION. Upon notice to the Borrower, Agent may, and upon written request of
Requisite Lenders shall, resign from the performance of all its agency functions
and duties hereunder at any time. Such resignation shall take effect immediately
unless otherwise indicated by the Requisite Lenders or Agent, as the case may
be, provided it is understood and agreed that the removed or resigning Agent
("PRIOR AGENT") may be required to remain in its role as collateral agent for a
reasonable period of time with respect to holding and perfecting Liens on
Collateral to allow documentation of the transfer of the agency responsibility
and authority. It is understood that the Prior Agent shall retain all of the
benefits of the indemnity provisions contained in this Agreement during such
period.
APPOINTMENT OF SUCCESSOR. Upon any such notice of resignation pursuant to clause
(i) above, Requisite Lenders shall appoint a successor Agent which, unless an
Event of Default has occurred and is continuing, shall be subject to Borrower's
approval (which shall not be unreasonably withheld or delayed). If a successor
Agent shall not have been so appointed within the thirty (30) Business Day
period referred to in clause (i) above, the retiring Agent, upon notice to
Borrower, shall then appoint a successor Agent who shall serve as Agent until
such time, if any, as Requisite Lenders appoint a successor Agent as provided
above.
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SUCCESSOR AGENT. Upon the acceptance of any appointment as Agent under the Loan
Documents by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under the Loan Documents. After any retiring Agent's resignation as
Agent, the provisions of this SECTION 8.2 shall continue to inure to its benefit
as to any actions taken or omitted to be taken by it in its capacity as Agent.
COLLATERAL MATTERS.
-------------------
RELEASE OF COLLATERAL. Lenders hereby irrevocably authorize Agent, at its option
and in its discretion, to release or subordinate any Lien granted to or held by
Agent upon any Collateral (w) with respect to any assets that are subject to a
Permitted Lien described in clause (j) or (l) of the definition of Permitted
Encrumbances so long as such release or subordination is made in connection with
the acquisition of such asset, (x) on the Termination Date, (y) constituting
property being sold or disposed of if Borrower certifies to Agent that the sale
or disposition is made in compliance with the provisions of this Agreement (and
Agent may rely in good faith conclusively on any such certificate, without
further inquiry) or (z) in accordance with the provisions of the next sentence.
In addition, with the consent of Requisite Lenders, during any Fiscal Year Agent
may release any Lien granted to or held by Agent upon any Collateral having a
book value not greater than ten percent (10%) of the total book value of all
Collateral as of the first day of such Fiscal Year.
CONFIRMATION OF AUTHORITY; EXECUTION OF RELEASES. Without in any manner limiting
Agent's authority to act without any specific or further authorization or
consent by Lenders (as set forth in SECTION 8.2(H)(I)), each Lender agrees to
confirm in writing, upon request by Agent or Borrower, the authority to release
any Collateral conferred upon Agent under clauses (x) and (y) of SECTION
8.2(H)(I). Upon receipt by Agent of any required confirmation from the Requisite
Lenders of its authority to release any particular item or types of Collateral,
and upon at least ten (10) Business Days' prior written request by Borrower,
Agent shall (and is hereby irrevocably authorized by Lenders to) execute such
documents as may be necessary to evidence the release of the Liens granted to
Agent upon such Collateral; PROVIDED, HOWEVER, that (x) Agent shall not be
required to execute any such document on terms which, in Agent's opinion, would
expose Agent to liability or create any obligation or entail any consequence
other than the release of such Liens without recourse or warranty, and (y) such
release shall not in any manner discharge, affect or impair the Obligations or
any Liens upon (or obligations of any Credit Party, in respect of), all
interests retained by any Credit Party, including the proceeds of any sale, all
of which shall continue to constitute part of the Collateral.
ABSENCE OF DUTY. Agent shall have no obligation whatsoever to any Lender or any
other Person to assure that the property covered by the Collateral Documents
exists or is owned by Borrower or any other Credit Party or is cared for,
protected or insured or has been encumbered or that the Liens granted to Agent
have been properly or sufficiently or lawfully created, perfected, protected or
enforced or are entitled to any particular priority, or to exercise at all or in
any particular manner or under any duty of care, disclosure or fidelity, or to
continue exercising, any of the rights, authorities and powers granted or
available to Agent in this SECTION 8.2(H) or in any of the Loan Documents, it
being understood and agreed that in respect of the property covered by the
Collateral Documents or any act, omission or event related thereto, Agent may
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act in any manner it may deem appropriate, in its discretion, given Agent's own
interest in property covered by the Collateral Documents as one of the Lenders
and that Agent shall have no duty or liability whatsoever to any of the other
Lenders, PROVIDED that Agent shall exercise the same care which it would in
dealing with loans for its own account.
AGENCY FOR PERFECTION. Agent and each Lender hereby appoint each other Lender as
agent for the purpose of perfecting Agent's security interest in assets which,
in accordance with the Code in any applicable jurisdiction, can be perfected by
possession or control. Should any Lender (other than Agent) obtain possession or
control of any such assets, such Lender shall notify Agent thereof, and,
promptly upon Agent's request therefor, shall deliver such assets to Agent or in
accordance with Agent's instructions or transfer control to Agent in accordance
with Agent's instructions. Each Lender agrees that it will not have any right
individually to enforce or seek to enforce any Collateral Document or to realize
upon any collateral security for the Loans unless instructed to do so by Agent
in writing, it being understood and agreed that such rights and remedies may be
exercised only by Agent.
NOTICE OF DEFAULT. 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 Agent for the
account of Lenders, unless Agent shall have received written notice from a
Lender or Borrower referring to this Agreement, describing such Default or Event
of Default and stating that such notice is a "notice of default". Agent will use
reasonable efforts to promptly notify each Lender of its receipt of any such
notice, unless such notice is with respect to defaults in the payment of
principal, interest and fees, in which case Agent will notify each Lender of its
receipt of such notice. Agent shall take such action with respect to such
Default or Event of Default as may be requested by Requisite Lenders in
accordance with SECTION 7. Unless and until Agent has received any such request,
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 interests of Lenders.
LENDER ACTIONS AGAINST COLLATERAL. Each Lender agrees that it will not take any
enforcement action, nor institute any actions or proceedings, with respect to
the Loans, against Borrower or any Credit Party hereunder or under the other
Loan Documents or against any Collateral (including the exercise of any right of
set-off) without the consent of the Agent or Requisite Lenders. All such
enforcement actions and proceedings shall be (i) taken in concert and (ii) at
the direction of or with the consent of Agent or Requisite Lenders. Agent is
authorized to issue all notices to be issued by or on behalf of Lenders with
respect to any Subordinated Debt and the Second Lien Loan. With respect to any
action by Agent to enforce the rights and remedies of Agent and the Lenders
under this Agreement and the other Loan Documents, each Lender hereby consents
to the jurisdiction of the court in which such action is maintained, and agrees
to deliver its Notes to Agent to the extent necessary to enforce the rights and
remedies of Agent for the benefit of the Lenders under any mortgages in
accordance with the provisions hereof.
AGENT REPORTS. Each Lender may from time to time receive one or more reports or
other information (each, a "REPORT") prepared by or on behalf of Agent (or one
or more of Agent's Affiliates). With respect to each Report, each Lender hereby
agrees that:
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Agent (and Agent's Affiliates) shall have no duties or obligations in connection
with or as a result of a Lender receiving a copy of a Report, which will be
provided solely as a courtesy, without consideration. Each Lender will perform
its own diligence and will make its own independent investigation of the
operations, financial conditions and affairs of the Credit Parties and will not
rely on any Report or make any claim that it has done so. In addition, each
Lender releases, and agrees that it will not assert, any claim against Agent (or
one or more of Agent's Affiliates) that in any way relates to any Report or
arises out of a Lender having access to any Report or any discussion of its
contents, and each Lender agrees to indemnify and hold harmless Agent (and
Agent's Affiliates) and their respective officers, directors, employees, agents
and attorneys from all claims, liabilities and expenses relating to a breach by
a Lender or any of its personnel of this Section or otherwise arising out of a
Lender's access to any Report or any discussion of its contents;
Each Report may not be complete and certain information and findings obtained by
Agent (or one or more of Agent's Affiliates) regarding the operations and
condition of the Credit Parties may not be reflected in each Report. Agent (and
Agent's Affiliates) makes no representations or warranties of any kind with
respect to (i) any existing or proposed financing; (ii) the accuracy or
completeness of the information contained in any Report or in any other related
documentation; (iii) the scope or adequacy of Agent's (and Agent's Affiliates')
due diligence, or the presence or absence of any errors or omissions contained
in any Report or in any other related documentation; and (iv) any work performed
by Agent (or one or more of Agent's Affiliates) in connection with or using any
Report or any related documentation; and
Each Lender agrees to safeguard each Report and any related documentation with
the same care which it uses with respect to information of its own which it does
not desire to disseminate or publish, and agrees not to reproduce or distribute
or provide copies of or disclose any Report or any other related documentation
or any related discussions to anyone.
INTERCREDITOR AGREEMENT. EACH LENDER AND EACH OTHER PERSON PARTY HERETO FROM
TIME TO TIME (OTHER THAN THE CREDIT PARTIES) HEREBY (A) ACKNOWLEDGES THAT IT HAS
RECEIVED A COPY OF THE INTERCREDITOR AGREEMENT, (B) CONSENTS TO THE PROVISIONS
OF THE INTERCREDITOR AGREEMENT, (C) AGREES THAT IT WILL BE BOUND BY AND WILL
TAKE NO ACTIONS CONTRARY TO THE PROVISIONS OF THE INTERCREDITOR AGREEMENT AND
(D) AUTHORIZES AND INSTRUCTS THE AGENT ON ITS BEHALF TO ENTER INTO THE
INTERCREDITOR AGREEMENT AS FIRST LIEN AGENT (AS DEFINED THEREIN) AND ON BEHALF
OF SUCH LENDER. AGENT IS AUTHORIZED TO EXECUTE AND DELIVER THE POST-CLOSING
AGREEMENT, AND EACH LENDER BY MAKING OR PURCHASING AN INTEREST IN ANY LOAN AT
ANY TIME SHALL BE DEEMED TO HAVE AGREED TO BE BOUND BY SUCH AGREEMENT.
ADDITIONAL SECURED PARTIES. The benefit of the provisions of the Loan Documents
directly relating to the Collateral or any Lien granted thereunder shall extend
to and be available to any Secured Party that is not a Lender as long as, by
accepting such benefits, such Secured Party agrees, as among the Agent and all
other Secured Parties, that such Secured Party is bound by (and, if requested by
the Agent, shall confirm such agreement in a writing in form and substance
62
acceptable to the Agent) this SECTION 8.2, SECTION 8.3 and SECTION 9.13 and the
decisions and actions of the Agent and the Required Lenders (or, where expressly
required by the terms of this Agreement, a greater proportion of the Lenders) to
the same extent a Lender is bound; PROVIDED, HOWEVER, that, notwithstanding the
foregoing, (a) such Secured Party shall be bound by SECTION 8.2(E) only to the
extent of Liabilities, costs and expenses with respect to or otherwise relating
to the Collateral held for the benefit of such Secured Party, in which case the
obligations of such Secured Party thereunder shall not be limited by any concept
of Pro Rata Share or similar concept, (b) each of the Agent and the Lenders
shall be entitled to act at its sole discretion, without regard to the interest
of such Secured Party, regardless of whether any Obligation to such Secured
Party thereafter remains outstanding, is deprived of the benefit of the
Collateral, becomes unsecured or is otherwise affected or put in jeopardy
thereby, and without any duty or liability to such Secured Party or any such
Obligation and (c) such Secured Party shall not have any right to be notified
of, consent to, direct, require or be heard with respect to, any action taken or
omitted in respect of the Collateral or under any Loan Document.
SET OFF AND SHARING OF PAYMENTS. Subject to SECTION 8.2(K), in addition to any
rights now or hereafter granted under applicable law and not by way of
limitation of any such rights, during the continuance of any Event of Default,
each Lender is hereby authorized by Borrower at any time or from time to time,
with reasonably prompt subsequent notice to Borrower (any prior or
contemporaneous notice being hereby expressly waived) to set off and to
appropriate and to apply any and all (A) balances held by such Lender at any of
its offices for the account of Borrower or any of its Subsidiaries (regardless
of whether such balances are then due to Borrower or its Subsidiaries), and (B)
other property at any time held or owing by such Lender to or for the credit or
for the account of Borrower or any of its Subsidiaries, against and on account
of any of the Obligations; except that no Lender shall exercise any such right
without the prior written consent of Agent. Notwithstanding anything herein to
the contrary, the failure to give notice of any set off and application made by
such Lender to Borrower shall not affect the validity of such set off and
application. Any Lender exercising a right to set off shall purchase for cash
(and the other Lenders shall sell) interests in each of such other Lender's Pro
Rata Share of the Obligations as would be necessary to cause all Lenders to
share the amount so set off with each other Lender entitled to share in the
amount so set off in accordance with their respective Pro Rata Shares. Borrower
agrees, to the fullest extent permitted by law, that any Lender may exercise its
right to set off with respect to amounts in excess of its Pro Rata Share of the
Obligations and upon doing so shall deliver such amount so set off to the Agent
for the benefit of all Lenders entitled to share in the amount so set off in
accordance with their Pro Rata Shares.
DISBURSEMENT OF FUNDS. Agent may, on behalf of Lenders, disburse funds to
Borrower for Loans requested. Each Lender shall reimburse Agent on demand for
all funds disbursed on its behalf by Agent, or if Agent so requests, each Lender
will remit to Agent its Pro Rata Share of any Loan before Agent disburses same
to Borrower. If Agent elects to require that each Lender make funds available to
Agent prior to a disbursement by Agent to Borrower, Agent shall advise each
Lender by telephone or fax of the amount of such Lender's Pro Rata Share of the
Loan requested by Borrower no later than 1:00 p.m. (New York time) on the
Funding Date applicable thereto, and each such Lender shall pay Agent such
Lender's Pro Rata Share of such requested Loan, in same day funds, by wire
transfer to Agent's account on such Funding Date. If any Lender fails to pay the
amount of its Pro Rata Share within one (1) Business Day after Agent's demand,
Agent shall promptly notify Borrower, and Borrower shall immediately repay such
63
amount to Agent. Any repayment required pursuant to this SECTION 8.4 shall be
without premium or penalty. Nothing in this SECTION 8.4 or elsewhere in this
Agreement or the other Loan Documents, including the provisions of SECTION 8.5,
shall be deemed to require Agent to advance funds on behalf of any Lender or to
relieve any Lender from its obligation to fulfill its commitments hereunder or
to prejudice any rights that Agent or Borrower may have against any Lender as a
result of any default by such Lender hereunder.
DISBURSEMENTS OF ADVANCES; PAYMENT.
-----------------------------------
ADVANCES; PAYMENTS.
Revolving Lenders shall refund or participate in the Swing Line Loan in
accordance with clauses (iii) and (iv) of SECTION 1.1(C). If the Swing Line
Lender declines to make a Swing Line Advance or if Swing Line Availability is
zero, Agent shall notify Revolving Lenders, promptly after receipt of a Notice
of Revolving Credit Advance and in any event prior to 1:00 p.m. (New York time)
on the date such Notice of a Revolving Credit Advance is received, by fax,
telephone or other similar form of transmission. Each Revolving Lender shall
make the amount of such Lender's Pro Rata Share of such Revolving Credit Advance
available to Agent in same day funds by wire transfer to Agent's account as set
forth in SECTION 1.1(E) not later than 3:00 p.m. (New York time) on the
requested Funding Date in the case of an Index Rate Loans and not later than
11:00 a.m. (New York time) on the requested Funding Date in the case of a LIBOR
Loan. After receipt of such wire transfers (or, in the Agent's sole discretion,
before receipt of such wire transfers), subject to the terms hereof, Agent shall
make the requested Revolving Credit Advance to Borrower as designated by
Borrower in the Notice of Revolving Credit Advance. All payments by each
Revolving Lender shall be made without setoff, counterclaim or deduction of any
kind.
At least once each calendar week or more frequently at Agent's election (each, a
"SETTLEMENT DATE"), Agent shall advise each Lender by telephone or fax of the
amount of such Lender's Pro Rata Share of principal, interest and Fees paid for
the benefit of Lenders with respect to each applicable Loan. Provided that each
Lender has funded all payments and Advances required to be made by it and funded
all purchases of participations required to be funded by it under this Agreement
and the other Loan Documents as of such Settlement Date, Agent shall pay to each
Lender such Lender's Pro Rata Share of principal, interest and Fees paid by
Borrower since the previous Settlement Date for the benefit of such Lender on
the Loans held by it. Such payments shall be made by wire transfer to such
Lender's account (as specified by such Lender in ANNEX E or the applicable
Assignment Agreement) not later than 2:00 p.m. (New York time) on the next
Business Day following each Settlement Date. To the extent that any Lender (a
"NON-FUNDING LENDER") has failed to fund all such payments and Advances or
failed to fund the purchase of all such participations required to be funded by
such Lender pursuant to this Agreement, Agent shall be entitled to set off the
funding shortfall against that Non-Funding Lender's Pro Rata Share of all
payments received from Borrower.
AVAILABILITY OF LENDER'S PRO RATA SHARE. Agent may assume that each Revolving
Lender will make its Pro Rata Share of each Revolving Credit Advance available
to Agent on each Funding Date. If such Pro Rata Share is not, in fact, paid to
Agent by such Revolving Lender when due, Agent will be entitled to recover such
amount on demand from such Revolving Lender without setoff, counterclaim or
deduction of any kind. If any Revolving Lender fails to pay the amount of its
64
Pro Rata Share forthwith upon Agent's demand, Agent shall promptly notify
Borrower and Borrower shall immediately repay such amount to Agent. Nothing in
this SECTION 8.5(B) or elsewhere in this Agreement or the other Loan Documents
shall be deemed to require Agent to advance funds on behalf of any Revolving
Lender or to relieve any Revolving Lender from its obligation to fulfill its
Commitments hereunder or to prejudice any rights that Borrower may have against
any Revolving Lender as a result of any default by such Revolving Lender
hereunder. To the extent that Agent advances funds to Borrower on behalf of any
Revolving Lender and is not reimbursed therefor on the same Business Day as such
Advance is made, Agent shall be entitled to retain for its account all interest
accrued on such Advance until reimbursed by the applicable Revolving Lender.
RETURN OF PAYMENTS.
-------------------
If Agent pays an amount to a Lender under this Agreement in the belief or
expectation that a related payment has been or will be received by Agent from
Borrower and such related payment is not received by Agent, then Agent will be
entitled to recover such amount from such Lender on demand without setoff,
counterclaim or deduction of any kind.
If Agent determines at any time that any amount received by Agent under this
Agreement must be returned to Credit Party or paid to any other Person pursuant
to any insolvency law or otherwise, then, notwithstanding any other term or
condition of this Agreement or any other Loan Document, Agent will not be
required to distribute any portion thereof to any Lender. In addition, each
Lender will repay to Agent on demand any portion of such amount that Agent has
distributed to such Lender, together with interest at such rate, if any, as
Agent is required to pay to Borrower or such other Person, without setoff,
counterclaim or deduction of any kind.
NON-FUNDING LENDERS. The failure of any Non-Funding Lender to make any Revolving
Credit Advance or any payment required by it hereunder, or to fund any purchase
of any participation in any Swing Line Loan to be made or funded by it on the
date specified therefor shall not relieve any other Lender (each such other
Revolving Lender, an "OTHER LENDER") of its obligations to make such Advance or
fund the purchase of any such participation on such date, but neither any Other
Lender nor Agent shall be responsible for the failure of any Non-Funding Lender
to make an Advance, fund the purchase of a participation or make any other
payment required hereunder. Notwithstanding anything set forth herein to the
contrary, a Non-Funding Lender shall not have any voting or consent rights under
or with respect to any Loan Document or constitute a "Lender" or a "Revolving
Lender" (or be included in the calculation of "Requisite Lenders", "Requisite
Revolving Lenders" or "Supermajority Revolving Lenders" hereunder) for any
voting or consent rights under or with respect to any Loan Document.
MISCELLANEOUS
INDEMNITIES. Borrower agrees to indemnify, pay, and hold Agent, each Lender,
each L/C Issuer and their respective Affiliates, officers, directors, employees,
agents, and attorneys (the "INDEMNITEES") harmless from and against any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs and expenses (including all reasonable fees and expenses of
counsel to such Indemnitees) of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against the Indemnitee as a result of such
Indemnitees being a party to this Agreement or the transactions consummated
65
pursuant to this Agreement or otherwise relating to any of the Loan Documents or
Related Transactions; provided, that Borrower shall have no obligation to an
Indemnitee hereunder with respect to liabilities to the extent resulting from
the gross negligence or willful misconduct of that Indemnitee as determined by a
court of competent jurisdiction. If and to the extent that the foregoing
undertaking may be unenforceable for any reason, Borrower agrees to make the
maximum contribution to the payment and satisfaction thereof which is
permissible under applicable law.
AMENDMENTS AND WAIVERS.
-----------------------
Except for actions expressly permitted to be taken by Agent, no amendment,
modification, termination or waiver of any provision of this Agreement or any
other Loan Document, or any consent to any departure by any Credit Party
therefrom, shall in any event be effective unless the same shall be in writing
and signed by Borrower, and by Requisite Lenders, Requisite Revolving Lenders,
Supermajority Revolving Lenders or all affected Lenders, as applicable. Except
as set forth in clauses (b) and (c) below, all such amendments, modifications,
terminations or waivers requiring the consent of any Lenders shall require the
written consent of Requisite Lenders.
No amendment, modification, termination or waiver of or consent with respect to
any provision of this Agreement that increases the ratios set forth in the
definition of Applicable Senior Multiple or Applicable Total Multiple, shall be
effective unless the same shall be in writing and signed by Agent, Supermajority
Revolving Lenders and Borrower. No amendment, modification, termination or
waiver of or consent with respect to any provision of this Agreement that waives
compliance with the conditions precedent set forth in SECTION 2.2 to the making
of any Loan or the incurrence of any Letter of Credit Obligations shall be
effective unless the same shall be in writing and signed by Agent, Requisite
Revolving Lenders and Borrower. Notwithstanding anything contained in this
Agreement to the contrary, no waiver or consent with respect to any Default or
any Event of Default shall be effective for purposes of the conditions precedent
to the making of Loans or the incurrence of Letter of Credit Obligations set
forth in SECTION 2.2 unless the same shall be in writing and signed by Agent,
Requisite Revolving Lenders and Borrower.
No amendment, modification, termination or waiver shall, unless in writing and
signed by Agent and each Lender directly affected thereby: (i) increase the
principal amount, or postpone or extend the scheduled date of expiration, of any
Lender's Commitment (which action shall be deemed only to affect those Lenders
whose Commitments are increased or the scheduled date of expiration of whose
Commitments are postponed or extended and may be approved by Requisite Lenders,
including those Lenders whose Commitments are increased or the scheduled date of
expiration of whose Commitments are postponed or extended); (ii) reduce the
principal of, rate of interest on (other than any determination or waiver to
charge or not charge interest at the Default Rate) or Fees payable with respect
to any Loan or Letter of Credit Obligations of any affected Lender; (iii) extend
any scheduled payment date or final maturity date of the principal amount of any
Loan of any affected Lender or postpone or extend the scheduled date of
expiration of any Letter of Credit beyond the date set forth in clause (b) of
the initial sentence of SECTION 1.1(D)(IV); (iv) waive, forgive, defer, extend
or postpone any payment of interest or Fees as to any affected Lender (which
action shall be deemed only to affect those Lenders to whom such payments are
made); (v) release any Guaranty or, except as otherwise permitted in SECTION 5.7
or SECTION 8.2(H), release Collateral (which action shall be deemed to directly
66
affect all Lenders); (vi) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Loans that shall be required for
Lenders or any of them to take any action hereunder (which action shall be
deemed to directly affect all Lenders); and (vii) amend or waive this SECTION
9.2 or the definitions of the terms "Requisite Lenders", "Requisite Revolving
Lenders" or "Supermajority Revolving Lenders" insofar as such definitions affect
the substance of this SECTION 9.2 or the term "Pro Rata Share" (which action
shall be deemed to directly affect all Lenders). Furthermore, no amendment,
modification, termination or waiver affecting the rights or duties of Agent or
L/C Issuer, or of GE Capital in respect of any Swap Related Reimbursement
Obligations, under this Agreement or any other Loan Document, including any
release of any Guaranty or Collateral requiring a writing signed by all Lenders,
shall be effective unless in writing and signed by Agent or L/C Issuer or GE
Capital, as the case may be, in addition to Lenders required hereinabove to take
such action. Each amendment, modification, termination or waiver shall be
effective only in the specific instance and for the specific purpose for which
it was given. No amendment, modification, termination or waiver shall be
required for Agent to take additional Collateral pursuant to any Loan Document.
No amendment, modification, termination or waiver of any provision of any Note
shall be effective without the written concurrence of the holder of that Note.
No notice to or demand on any Credit Party in any case shall entitle such Credit
Party or any other Credit Party to any other or further notice or demand in
similar or other circumstances. Any amendment, modification, termination, waiver
or consent effected in accordance with this SECTION 9.2 shall be binding upon
each holder of the Notes at the time outstanding and each future holder of the
Notes.
NOTICES.
--------
ADDRESSES. All notices, demands, requests, directions and other communications
required or expressly authorized to be made by this Agreement shall, whether or
not specified to be in writing but unless otherwise expressly specified to be
given by any other means, be given in writing and (i) addressed to the
respective party as set forth below and otherwise to the party to be notified at
its address specified opposite its name on the signature page of any applicable
Assignment, (ii) posted to any E-SystemIntralinks(R) (to the extent such system
is available and set up by or at the direction of the Agent or (prior to
posting) in an appropriate location by uploading such notice, demand, request,
direction or other communication to ▇▇▇.▇▇▇▇▇▇▇▇▇▇.▇▇▇, faxing it to
▇▇▇-▇▇▇-▇▇▇▇ with an appropriate bar-coded fax coversheet or using such other
means of posting to Intralinks(R) as may be available and reasonably acceptable
to the Agent prior to such posting, (iii) posted to any other E-System set up by
or at the direction of the Agent in an appropriate location or (iv) addressed to
such other address as shall be notified in writing (A) in the case of the
Borrower, the Agent and the Swingline Lender, to the other parties hereto and
(B) in the case of all other parties, to the Borrower and the Agent.
Transmission by electronic mail (including E-Fax, even if transmitted to the fax
numbers set forth in CLAUSE (I) above) shall not be sufficient or effective to
transmit any such notice under this SUBSECTION (A) unless such transmission is
an available means to post to any E-System.
Notices shall be addressed as follows:
If to Borrower: Radnet Management, Inc.
c/o Primedex Health Systems, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇▇ ▇▇▇▇▇▇, M.D.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
67
With a copy to: Sheppard, Mullin, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to Agent or GE Capital: General Electric Capital Corporation
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ATTN: General Counsel - Healthcare
Financial Services
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to: ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
Sears Tower, Suite 5800
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
ATTN: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to a Lender: To the address set forth on the
signature page hereto or in the
applicable Assignment Agreement
EFFECTIVENESS. All communications described in SUBSECTION (A) above and all
other notices, demands, requests and other communications made in connection
with this Agreement shall be effective and be deemed to have been received (i)
if delivered by hand, upon personal delivery, (ii) if delivered by overnight
courier service, one Business Day after delivery to such courier service, (iii)
if delivered by mail, within (3) Business Days after deposited in the mail and,
(iv) if delivered by facsimile (other than to post to an E-System pursuant to
SUBSECTION (A)(II) OR (A)(III) above), upon sender's receipt of confirmation of
proper transmission, and (v) if delivered by posting to any E-System, on the
later of the date of such posting in an appropriate location and the date access
to such posting is given to the recipient thereof in accordance with the
standard procedures applicable to such E-System; PROVIDED, HOWEVER, that no
communications to the Agent pursuant to SECTION 2 or SECTION 8 shall be
effective until received by the Agent.
ELECTRONIC TRANSMISSIONS.
-------------------------
AUTHORIZATION. Subject to the provisions of SUBSECTION (A), each of the Agent,
the Borrower, the Lenders, the L/C Issuers and each of their authorized
representatives is authorized (but not required) to transmit, post or otherwise
make or communicate, in its sole discretion, Electronic Transmissions in
68
connection with any Loan Document and the transactions contemplated therein.
Each of Holdings, the Borrower and each Credit Party hereby acknowledges and
agrees, and each of Holdings and the Borrower shall cause each other Credit
Party to acknowledge and agree, that the use of Electronic Transmissions is not
necessarily secure and that there are risks associated with such use, including
risks of interception, disclosure and abuse and each indicates it assumes and
accepts such risks by hereby authorizing the transmission of Electronic
Transmissions.
SIGNATURES. Subject to the provisions of SUBSECTION (A) above, (A) no posting to
any E-System shall be denied legal effect merely because it is made
electronically, (B) each E Signature on any such posting shall be deemed
sufficient to satisfy any requirement for a "signature" and (C) each such
posting shall be deemed sufficient to satisfy any requirement for a "writing",
in each case including pursuant to any Loan Document, any applicable provision
of any UCC, the federal Uniform Electronic Transactions Act, the Electronic
Signatures in Global and National Commerce Act and any substantive or procedural
Requirement of Law governing such subject matter, (ii) each such posting that is
not readily capable of bearing either a signature or a reproduction of a
signature may be signed, and shall be deemed signed, by attaching to, or
logically associating with such posting, an E-Signature, upon which each Credit
Party may rely and assume the authenticity thereof, (iii) each such posting
containing a signature, a reproduction of a signature or an E-Signature shall,
for all intents and purposes, have the same effect and weight as a signed paper
original and (iv) each party hereto or beneficiary hereto agrees not to contest
the validity or enforceability of any posting on any E-System or E-Signature on
any such posting under the provisions of any applicable Requirement of Law
requiring certain documents to be in writing or signed; PROVIDED, HOWEVER, that
nothing herein shall limit such party's or beneficiary's right to contest
whether any posting to any E-System or E-Signature has been altered after
transmission.
SEPARATE AGREEMENTS. All uses of an E-System shall be governed by and subject
to, in addition to SUBSECTIONS (A) and (B) and this SUBSECTION (C), separate
terms and conditions posted or referenced in such E-System and related
Contractual Obligations executed by Credit Parties in connection with the use of
such E-System.
LIMITATION OF LIABILITY. ALL E-SYSTEMS AND ELECTRONIC TRANSMISSIONS SHALL BE
PROVIDED "AS IS" AND "AS AVAILABLE". NONE OF AGENT OR ANY OF ITS RELATED PERSONS
WARRANTS THE ACCURACY, ADEQUACY OR COMPLETENESS OF ANY E-SYSTEMS OR ELECTRONIC
TRANSMISSION, AND EACH DISCLAIMS ALL LIABILITY FOR ERRORS OR OMISSIONS THEREIN.
NO WARRANTY OF ANY KIND IS MADE BY THE AGENT OR ANY OF ITS RELATED PERSONS IN
CONNECTION WITH ANY E SYSTEMS OR ELECTRONIC COMMUNICATION, INCLUDING ANY
WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT
OF THIRD-PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS. Each of
Holdings, the Borrower and each Credit Party agrees (and each of Holdings and
the Borrower shall cause each other Credit Party to agree) that the Agent has no
responsibility for maintaining or providing any equipment, software, services or
any testing required in connection with any Electronic Transmission or otherwise
required for any E-System.
69
FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of Agent or any Lender to exercise, nor any partial exercise of, any
power, right or privilege hereunder or under any other Loan Documents shall
impair such power, right, or privilege or be construed to be a waiver of any
Default or Event of Default. All rights and remedies existing hereunder or under
any other Loan Document are cumulative to and not exclusive of any rights or
remedies otherwise available.
MARSHALING; PAYMENTS SET ASIDE. Neither Agent nor any Lender shall be under any
obligation to marshal any assets in payment of any or all of the Obligations. To
the extent that Borrower makes payment(s) or Agent enforces its Liens or Agent
or any Lender exercises its right of set-off, and such payment(s) or the
proceeds of such enforcement or set-off is subsequently invalidated, declared to
be fraudulent or preferential, set aside, or required to be repaid by anyone
(whether as a result of any demand, litigation, settlement or otherwise), then
to the extent of such recovery, the Obligations or part thereof originally
intended to be satisfied, and all Liens, rights and remedies therefor, shall be
revived and continued in full force and effect as if such payment had not been
made or such enforcement or set-off had not occurred.
SEVERABILITY. The invalidity, illegality, or unenforceability in any
jurisdiction of any provision under the Loan Documents shall not affect or
impair the remaining provisions in the Loan Documents.
LENDERS' OBLIGATIONS SEVERAL; INDEPENDENT NATURE OF LENDERS' RIGHTS. The
obligation of each Lender hereunder is several and not joint and no Lender shall
be responsible for the obligation or commitment of any other Lender hereunder.
In the event that any Lender at any time should fail to make a Loan as herein
provided, the Lenders, or any of them, at their sole option, may make the Loan
that was to have been made by the Lender so failing to make such Loan. Nothing
contained in any Loan Document and no action taken by Agent or any Lender
pursuant hereto or thereto shall be deemed to constitute Lenders to be a
partnership, an association, a joint venture or any other kind of entity. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt.
HEADINGS. Section and subsection headings are included herein for convenience of
reference only and shall not constitute a part of this Agreement for any other
purposes or be given substantive effect.
APPLICABLE LAW. THIS AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS WHICH DOES
NOT EXPRESSLY SET FORTH APPLICABLE LAW SHALL BE GOVERNED BY AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK.
SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns except that Borrower may not assign its rights or obligations hereunder
without the written consent of all Lenders and any such purported assignment
without such written consent shall be void.
70
NO FIDUCIARY RELATIONSHIP; LIMITED LIABILITY. No provision in the Loan Documents
and no course of dealing between the parties shall be deemed to create any
fiduciary duty owing to any Credit Party by Agent or any Lender. Borrower and
each other Credit Party agree that neither Agent nor any Lender shall have
liability to Borrower or any other Credit Party (whether sounding in tort,
contract or otherwise) for losses suffered by Borrower or any other Credit Party
in connection with, arising out of, or in any way related to the transactions
contemplated and the relationship established by the Loan Documents, or any act,
omission or event occurring in connection therewith, unless and to the extent
that it is determined that such losses resulted from the gross negligence or
willful misconduct of the party from which recovery is sought as determined by a
final non-appealable order by a court of competent jurisdiction. Neither Agent
nor any Lender shall have any liability with respect to, and Borrower and each
other Credit Party hereby waive, release and agree not to ▇▇▇ for, any special,
indirect or consequential damages suffered by Borrower and any other Credit
Party in connection with, arising out of, or in any way related to the Loan
Documents or the transactions contemplated thereby.
CONSTRUCTION. Agent, each Lender, Borrower and each other Credit Party
acknowledge that each of them has had the benefit of legal counsel of its own
choice and has been afforded an opportunity to review the Loan Documents with
its legal counsel and that the Loan Documents shall be construed as if jointly
drafted by Agent, each Lender, Borrower and each other Credit Party.
CONFIDENTIALITY. Until the Termination Date, Agent and each Lender agree to
exercise their best efforts to keep confidential any non-public information
delivered pursuant to the Loan Documents and identified as such by Borrower and
not to disclose such information to Persons other than to potential assignees or
participants or to any Affiliate of, or Persons employed by or engaged, by
Agent, a Lender or any of their respective Affiliates or a Lender's assignees or
participants including attorneys, auditors, professional consultants, rating
agencies, insurance industry associations and portfolio management services, or
to a Person that is an investor or prospective investor in a Securitization,
that agrees that its access to information regarding the Borrower and the Loans
is solely for purposes of evaluating an investment in such Securitization, or to
a Person that is a trustee, collateral manager, servicer, noteholder or secured
party in a Securitization in connection with the administration, servicing and
reporting on the assets serving as collateral for such Securitization. The
confidentiality provisions contained in this SECTION 9.13 shall not apply to
disclosures (a) required to be made by Agent or any Lender to any regulatory or
governmental agency or pursuant to (i) any subpoena or similar legal process or
(ii) law, rule, regulations or legal process, (b) consisting of general
portfolio information that does not specifically identify Borrower, (c) in
connection with the exercise of any remedies hereunder or under any other Loan
Document or any action or proceeding relating to this Agreement or any other
Loan Document or the enforcement of rights hereunder or thereunder, (d) 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, any Lender or
any of their respective Affiliates on a nonconfidential basis from a source
other than the Credit Parties or (e) made to S&P, ▇▇▇▇▇'▇ and/or other ratings
agency, as such Lender reasonably deems necessary or appropriate in connection
with such Lender's obtaining financing; provided, however, that each such entity
agrees to take reasonable steps to maintain the confidentiality of such
disclosures. Each Credit Party consents to the publication by Agent or any
Lender of a tombstone or similar advertising material relating to the financing
transactions contemplated by this Agreement. Agent or such Lender shall provide
a draft of any such tombstone or similar advertising material to each Credit
71
Party for review and comment prior to the publication thereof. Agent may provide
to industry trade organizations information with respect to the Credit Facility
that is necessary and customary for inclusion in league table measurements. The
obligations of Agent and Lenders under this SECTION 9.13 shall supersede and
replace the obligations of Agent and Lenders under any confidentiality agreement
in respect of this financing executed and delivered by Agent or any Lender prior
to the date hereof.
CONSENT TO JURISDICTION. BORROWER AND CREDIT PARTIES HEREBY CONSENT TO THE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN NEW YORK COUNTY, STATE
OF NEW YORK AND IRREVOCABLY AGREE THAT, SUBJECT TO AGENT'S ELECTION, ALL ACTIONS
OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE OTHER LOAN
DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. BORROWER AND CREDIT PARTIES
EXPRESSLY SUBMIT AND CONSENT TO THE JURISDICTION OF THE AFORESAID COURTS AND
WAIVE ANY DEFENSE OF FORUM NON CONVENIENS. BORROWER AND CREDIT PARTIES HEREBY
WAIVE PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREES THAT ALL SUCH SERVICE
OF PROCESS MAY BE MADE UPON BORROWER AND CREDIT PARTIES BY CERTIFIED OR
REGISTERED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED TO BORROWER, AT THE ADDRESS
SET FORTH IN THIS AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN (10) DAYS
AFTER THE SAME HAS BEEN POSTED.
WAIVER OF JURY TRIAL. BORROWER, CREDIT PARTIES, AGENT AND EACH LENDER HEREBY
WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
BORROWER, CREDIT PARTIES, AGENT AND EACH LENDER ACKNOWLEDGE THAT THIS WAIVER IS
A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS
RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS AND THAT EACH WILL CONTINUE TO RELY ON THE WAIVER IN THEIR RELATED
FUTURE DEALINGS. BORROWER, CREDIT PARTIES, AGENT AND EACH LENDER WARRANT AND
REPRESENT THAT EACH HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH
LEGAL COUNSEL, AND THAT EACH KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
RIGHTS.
SURVIVAL OF WARRANTIES AND CERTAIN AGREEMENTS. All agreements, representations
and warranties made herein shall survive the execution and delivery of this
Agreement, the making of the Loans, issuances of Letters of Credit and the
execution and delivery of the Notes. Notwithstanding anything in this Agreement
or implied by law to the contrary, the agreements of Borrower set forth in
SECTIONS 1.8, 1.9 and 9.1 shall survive the repayment of the Obligations and the
termination of this Agreement.
ENTIRE AGREEMENT. This Agreement, the Notes and the other Loan Documents embody
the entire agreement among the parties hereto and supersede all prior
commitments, agreements, representations, and understandings, whether oral or
written, relating to the subject matter hereof (other than the GE Capital Fee
Letter), and may not be contradicted or varied by evidence of prior,
contemporaneous, or subsequent oral agreements or discussions of the parties
hereto. All Exhibits, Schedules and Annexes referred to herein are incorporated
in this Agreement by reference and constitute a part of this Agreement.
72
COUNTERPARTS; EFFECTIVENESS. This Agreement and any amendments, waivers,
consents or supplements may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all of which
counterparts together shall constitute but one in the same instrument. This
Agreement shall become effective upon the execution of a counterpart hereof by
each of the parties hereto.
REPLACEMENT OF LENDERS.
Within fifteen (15) days after receipt by Borrower of written notice and demand
from any Lender for payment pursuant to SECTION 1.8 or 1.9 or, as provided in
SECTION 9.19(C), in the case of certain refusals by any Lender to consent to
certain proposed amendments, modifications, terminations or waivers with respect
to this Agreement that have been approved by Requisite Lenders, Requisite
Revolving Lenders, Supermajority Revolving Lenders or all affected Lenders, as
applicable (any such Lender demanding such payment or refusing to so consent
being referred to herein as an "AFFECTED LENDER"), Borrower may, at its option,
notify Agent and such Affected Lender of its intention to do one of the
following:
Borrower may obtain, at Borrower's expense, a replacement Lender ("REPLACEMENT
LENDER") for such Affected Lender, which Replacement Lender shall be reasonably
satisfactory to Agent. In the event Borrower obtains a Replacement Lender that
will purchase all outstanding Obligations owed to such Affected Lender and
assume its Commitments hereunder within ninety (90) days following notice of
Borrower's intention to do so, the Affected Lender shall sell and assign all of
its rights and delegate all of its obligations under this Agreement to such
Replacement Lender in accordance with the provisions of SECTION 8.1, PROVIDED
that Borrower has reimbursed such Affected Lender for any administrative fee
payable pursuant to SECTION 8.1 and, in any case where such replacement occurs
as the result of a demand for payment pursuant to SECTION 1.8 or 1.9, paid all
amounts required to be paid to such Affected Lender pursuant to SECTION 1.8 or
1.9 through the date of such sale and assignment; or
Borrower may, with Agent's consent, prepay in full all outstanding Obligations
owed to such Affected Lender and terminate such Affected Lender's Pro Rata Share
of the Revolving Loan Commitment and Pro Rata Share of the Term Loan B
Commitment, in which case the Revolving Loan Commitment and Term Loan B
Commitment will be reduced by the amount of such Pro Rata Share. Borrower shall,
within ninety (90) days following notice of its intention to do so, prepay in
full all outstanding Obligations owed to such Affected Lender (including, in any
case where such prepayment occurs as the result of a demand for payment for
increased costs, such Affected Lender's increased costs for which it is entitled
to reimbursement under this Agreement through the date of such prepayment), and
terminate such Affected Lender's obligations under the Revolving Loan Commitment
and Term Loan B Commitment.
In the case of a Non-Funding Lender pursuant to SECTION 8.5(A), at Borrower's
request, Agent or a Person acceptable to Agent shall have the right with Agent's
consent and in Agent's sole discretion (but shall have no obligation) to
purchase from any Non-Funding Lender, and each Non-Funding Lender agrees that it
shall, at Agent's request, sell and assign to Agent or such Person, all of the
73
Loans and Commitments of that Non-Funding Lender for an amount equal to the
principal balance of all Loans held by such Non-Funding Lender and all accrued
interest and Fees with respect thereto through the date of sale, such purchase
and sale to be consummated pursuant to an executed Assignment Agreement.
If, in connection with any proposed amendment, modification, waiver or
termination pursuant to SECTION 9.2 (a "PROPOSED CHANGE"):
requiring the consent of all affected Lenders, the consent of Requisite Lenders
is obtained, but the consent of other Lenders whose consent is required is not
obtained (any such Lender whose consent is not obtained as described in this
clause (i) and in clauses (ii), (iii) and (iv) below being referred to as a
"NON-CONSENTING LENDER"), or
requiring the consent of Supermajority Revolving Lenders, the consent of
Requisite Revolving Lenders is obtained, but the consent of Supermajority
Revolving Lenders is not obtained,
then, so long as Agent is not a Non-Consenting Lender, at Borrower's request
Agent, or a Person reasonably acceptable to Agent, shall have the right with
Agent's consent and in Agent's sole discretion (but shall have no obligation) to
purchase from such Non-Consenting Lenders, and such Non-Consenting Lenders agree
that they shall, upon Agent's request, sell and assign to Agent or such Person,
all of the Loans and Commitments of such Non-Consenting Lenders for an amount
equal to the principal balance of all Loans held by the Non-Consenting Lenders
and all accrued interest and Fees and other Obligations owing with respect
thereto through the date of sale, such purchase and sale to be consummated
pursuant to an executed Assignment Agreement.
DELIVERY OF TERMINATION STATEMENTS AND MORTGAGE RELEASES. On the Termination
Date, and so long as no suits, actions proceedings, or claims are pending or
threatened against any Indemnitee asserting any damages, losses or liabilities
that are indemnified liabilities hereunder, Agent shall deliver to Borrower
termination statements, mortgage releases and other documents necessary or
appropriate to evidence the termination of the Liens securing payment of the
Obligations.
SUBORDINATION OF INTERCOMPANY DEBT.
-----------------------------------
Each Credit Party hereby agrees that any intercompany Indebtedness or other
intercompany payables or receivables, or intercompany advances directly or
indirectly made by or owed to such Credit Party by any other Credit Party
(collectively, "INTERCOMPANY DEBT"), of whatever nature at any time outstanding
shall be subordinate and subject in right of payment to the prior payment in
full in cash of the Obligations. Each Credit Party hereby agrees that it will
not, while any Event of Default is continuing, accept any payment, including by
offset, on any Intercompany Debt until the Termination Date, in each case,
except with the prior written consent of Agent.
In the event that any payment on any Intercompany Debt shall be received by a
Credit Party other than as permitted by this SECTION 9.21 before the Termination
Date, such Credit Party shall receive such payments and hold the same in trust
for, segregate the same from its own assets and shall immediately pay over to,
the Agent for the benefit of the Agent and Lenders all such sums to the extent
necessary so that Agent and the Lenders shall have been paid in full, in cash,
all Obligations owed or which may become owing.
74
Upon any payment or distribution of any assets of any Credit Party of any kind
or character, whether in cash, property or securities by set-off, recoupment or
otherwise, to creditors in any liquidation or other winding-up of such Credit
Party or in the event of any Proceeding, Agent and Lenders shall first be
entitled to receive payment in full in cash, in accordance with the terms of the
Obligations and of this Agreement, of all amounts payable under or in respect of
such Obligations, before any payment or distribution is made on, or in respect
of, any Intercompany Debt, in any such Proceeding, any distribution or payment,
to which Agent or any Lender would be entitled except for the provisions hereof
shall be paid by such Credit Party, or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other person making such payment or distribution
directly to Agent (for the benefit of Agent and the Lenders) to the extent
necessary to pay all such Obligations in full in cash, after giving effect to
any concurrent payment or distribution to Agent and Lenders (or to Agent for the
benefit of Agent and Lenders).
75
Witness the due execution hereof by the respective duly authorized
officers of the undersigned as of the date first written above.
RADNET MANAGEMENT, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
PRIMEDEX HEALTH SYSTEMS, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
▇▇▇▇▇▇▇ RADIOLOGY MEDICAL GROUP III
By: ProNet Imaging Medical Group, Inc.,
its general partner
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
By: ▇▇▇▇▇▇▇ Radiology Medical Group, Inc.,
its general partner
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
PRONET IMAGING MEDICAL GROUP, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
S-1
▇▇▇▇▇▇▇ RADIOLOGY MEDICAL GROUP, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
RADNET SUB, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
SO CAL MR SITE MANAGEMENT, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
RADNET MANAGEMENT I, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
RADNET MANAGEMENT II, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
S-2
RADNET MANAGED IMAGING SERVICES, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
DIAGNOSTIC IMAGING SERVICES, INC.
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
GENERAL ELECTRIC CAPITAL CORPORATION,
as Agent, an L/C Issuer and a Lender
By:
-------------------------------------------
Its Duly Authorized Signatory
S-3
[LENDER]
By:
-------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
Address:
-------------------------------------
Attn:
------------------------------
Fax: (___) ___-____
ABA No.:
----------------------------------------
account No.:
------------------------------------
Bank:
-------------------------------------------
Bank Address:
-----------------------------------
S-4
ANNEX A
TO
CREDIT AGREEMENT
----------------
DEFINITIONS
-----------
Capitalized terms used in the Loan Documents shall have (unless
otherwise provided elsewhere in the Loan Documents) the following respective
meanings and all references to Sections, Exhibits, Schedules or Annexes in the
following definitions shall refer to Sections, Exhibits, Schedules or Annexes of
or to the Agreement:
ACCEPTABLE STANDBY LETTER OF CREDIT means a standby letter of credit,
issued by a bank or financial institution acceptable to Agent in its sole
discretion, in form and substance satisfactory to Agent in its sole discretion,
in an amount equal to 105% of the aggregate outstanding Letter of Credit
Obligations to be available to Agent to reimburse payments of drafts drawn under
outstanding Letters of Credit and to pay any Fees and expenses related thereto.
ACCOUNT DEBTOR means any Person who may become obligated to any Credit
Party under, with respect to, or on account of, an Account, Chattel Paper or
General Intangibles (including a payment intangible).
ACCOUNTING CHANGES means: (a) changes in accounting principles required
by GAAP and implemented by Holdings or any of its Subsidiaries; (b) changes in
accounting principles recommended by Holdings' certified public accountants and
implemented by Holdings; and (c) changes in carrying value of Borrower's or any
of its Subsidiaries' assets, liabilities or equity accounts resulting from (i)
the application of purchase accounting principles (A.P.B. 16 and/or 17, FASB 141
and EITF 88-16 and FASB 109) to the Related Transactions or (ii) as the result
of any other adjustments that, in each case, were applicable to, but not
included in, the Pro Forma.
ACCOUNTS means all "accounts," as such term is defined in the Code, now
owned or hereafter acquired by any Credit Party, including (a) all accounts
receivable, other receivables, book debts and other forms of obligations (other
than forms of obligations evidenced by Chattel Paper or Instruments), (including
any such obligations that may be characterized as an account or contract right
under the Code), (b) all of each Credit Party's rights in, to and under all
purchase orders or receipts for goods or services, (c) all of each Credit
Party's rights to any goods represented by any of the foregoing (including
unpaid sellers' rights of rescission, replevin, reclamation and stoppage in
transit and rights to returned, reclaimed or repossessed goods), (d) all rights
to payment due to any Credit Party for property sold, leased, licensed, assigned
or otherwise disposed of, for a policy of insurance issued or to be issued, for
a secondary obligation incurred or to be incurred, for energy provided or to be
provided, for the use or hire of a vessel under a charter or other contract,
arising out of the use of a credit card or charge card, or for services rendered
or to be rendered by such Credit Party or in connection with any other
transaction (whether or not yet earned by performance on the part of such Credit
Party), (e) all healthcare insurance receivables, and (f) all collateral
security of any kind, now or hereafter in existence, given by any Account Debtor
or other Person with respect to any of the foregoing.
A-1
ADVANCES means any Revolving Credit Advance or Swing Line Advance, as
the context may require.
AFFECTED LENDER has the meaning ascribed to it in SECTION 9.19(A).
AFFILIATE means, with respect to any Person, (a) each Person that,
directly or indirectly, owns or controls, whether beneficially, or as a trustee,
guardian or other fiduciary, 10% or more of the Stock having ordinary voting
power in the election of directors of such Person, (b) each Person that
controls, is controlled by or is under common control with such Person, and (c)
each of such Person's officers, directors, joint venturers and partners. For the
purposes of this definition, "control" of a Person shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of its
management or policies, whether through the ownership of voting securities, by
contract or otherwise; PROVIDED, HOWEVER, that the term "Affiliate" shall
specifically exclude Agent and each Lender, and any purchaser of the
Subordinated Debt or Second Lien Loan.
AGENT means GE Capital in its capacity as Agent for Lenders or a
successor agent.
AGREEMENT means this Credit Agreement (including all schedules,
subschedules, annexes and exhibits hereto), as the same may be amended,
supplemented, restated or otherwise modified from time to time.
ANTI-TERRORISM LAWS has the meaning ascribed to it in SECTION 3.9.
APPLICABLE L/C MARGIN means the per annum fee, from time to time in
effect, payable with respect to outstanding Letter of Credit Obligations as
determined by reference to SECTION 1.2(A).
APPLICABLE MARGINS means collectively the Applicable L/C Margin, the
Applicable Unused Line Fee Margin, the Applicable Revolver Index Margin, the
Applicable Term Loan B Index Margin, the Applicable Revolver LIBOR Margin and
the Applicable Term Loan B LIBOR Margin.
APPLICABLE SENIOR MULTIPLE means (i) from the Closing Date through
April 30, 2006, 3.00:1.00 and (ii) on each day thereafter, the maximum permitted
Senior Leverage Ratio for the most recently specified test date set forth in
SECTION 6.1(F) as of or prior to such day.
APPLICABLE TOTAL MULTIPLE means (i) from the Closing Date through April
30, 2006, 5.25:1.00 and (ii) on each day thereafter, the maximum permitted
Leverage Ratio for the most recently specified test date set forth in SECTION
6.1(E) as of or prior to such day.
APPLICABLE REVOLVER INDEX MARGIN means the per annum interest rate
margin from time to time in effect and payable in addition to the Index Rate
applicable to the Revolving Loan, as determined by reference to SECTION 1.2(A).
APPLICABLE REVOLVER LIBOR MARGIN means the per annum interest rate from
time to time in effect and payable in addition to the LIBOR Rate applicable to
the Revolving Loan, as determined by reference to SECTION 1.2(A).
A-2
APPLICABLE TERM LOAN B INDEX MARGIN means the per annum interest rate
from time to time in effect and payable in addition to the Index Rate applicable
to the Term Loan B, as determined by reference to SECTION 1.2(a).
APPLICABLE TERM LOAN B LIBOR MARGIN means the per annum interest rate
from time to time in effect and payable in addition to the LIBOR Rate applicable
to the Term Loan B, as determined by reference to SECTION 1.2(a).
APPLICABLE UNUSED LINE FEE MARGIN means the per annum fee, from time to
time in effect, payable in respect of Borrower's non-use of committed funds
pursuant to SECTION 1.3(B), which fee is determined by reference to SECTION 1.2
(A).
APPROVED FUND means, with respect to any Lender, any Person (other than
a natural Person) that (a) 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 its business and (b) is advised or managed by (i) such
Lender, (ii) any Affiliate of such Lender or (iii) any Person (other than an
individual) or any Affiliate of any Person (other than an individual) that
administers or manages such Lender.
ASSET DISPOSITION means the disposition whether by sale, lease,
transfer, loss, damage, destruction, casualty, condemnation or otherwise of any
of the following: (a) any of the Stock or other equity or ownership interest of
any of Borrower's Subsidiaries or (b) any or all of the assets of Borrower or
any of its Subsidiaries other than sales and dispositions described in SECTION
5.7(A).
ASSIGNMENT AGREEMENT has the meaning ascribed to it in SECTION 8.1(A).
AVERAGE DAILY BALANCE means, for any period, the quotient of (a) the
sum of daily closing balances of the Revolving Loan (including, without
duplication, the Swing Line Loan and Letter of Credit Obligations) for each day
during such period divided by (b) the number of days during such period. To the
extent the calculation of the Leverage Ratio and Senior Leverage Ratio includes
any period prior to the Closing Date, the Average Daily Balance of the Revolving
Loan (including, without duplication, the Swing Line Loan and Letter of Credit
Obligations) shall be measured from the Closing Date to the last day of the
period being measured.
BANKRUPTCY CODE means the provisions of Title 11 of the United States
Code, 11 U.S.C. ▇▇.▇▇. 101 et seq. or other applicable bankruptcy, insolvency or
similar laws.
▇▇▇▇▇▇▇ has the meaning ascribed to in the recitals to the Agreement.
▇▇▇▇▇▇▇ RADIOLOGY has the meaning ascribed to in the recitals to the
Agreement.
BORROWER has the meaning ascribed to it in the preamble to the
Agreement.
BORROWER PLEDGE AGREEMENT means the Pledge Agreement of even date
herewith executed by Borrower in favor of Agent, on behalf of itself and
Lenders, pledging all Stock of its Subsidiaries and all Intercompany Notes owing
to or held by it.
A-3
BORROWING AVAILABILITY means as of any date of determination the lesser
of (i) the Maximum Amount and (ii) the Borrowing Base, in each case, LESS the
sum of the Revolving Loan then outstanding (including, without duplication, the
outstanding balance of Letter of Credit Obligations and the Swing Line Loan then
outstanding) LESS at all times on or prior to April __, 2006, $1,000,000.
BORROWING BASE means, as of any date of calculation, the lesser of (i)
(a) the product of (A) EBITDA multiplied by (B) the Applicable Senior Multiple
as of such date, MINUS (b) outstanding Senior Debt of Holdings and its
Subsidiaries (other than the outstanding aggregate principal balance of the
Revolving Loans) and (ii) (a) the product of (A) EBITDA multiplied by (B) the
Applicable Total Multiple as of such date, MINUS (b) outstanding total Funded
Debt of Holdings and its Subsidiaries (other than the outstanding aggregate
principal balance of the Revolving Loans). For purposes of calculating the
Borrowing Base as of any date of calculation, EBITDA shall be calculated for the
twelve (12) month period ending on the date most recently ended for which
financial statements described in SECTION 6.2(A) of Holdings and its
Subsidiaries were delivered to Agent.
BORROWING BASE CERTIFICATE has the meaning ascribed to it in SECTION
6.2(D).
BUSINESS DAY means any day that is not a Saturday, a Sunday or a day on
which banks are required or permitted to be closed in the State of New York or
New Jersey and in reference to LIBOR Loans shall mean any such day that is also
a LIBOR Business Day.
CAPEX LIMIT has the meaning ascribed to it in SECTION 6.1.
CAPITAL EXPENDITURES has the meaning ascribed to it in SECTION 6.1(A)
of SCHEDULE 1 to ANNEX F.
CAPITAL LEASE means, with respect to any Person, any lease of any
property (whether real, personal or mixed) by such Person as lessee that, in
accordance with GAAP, would be required to be classified and accounted for as a
capital lease on a balance sheet of such Person.
CAPITAL LEASE OBLIGATION means, with respect to any Capital Lease of
any Person, the amount of the obligation of the lessee thereunder that, in
accordance with GAAP, would appear on a balance sheet of such lessee in respect
of such Capital Lease.
CAPITATED CONTRACTS means all of Credit Parties' contracts whether
presently existing or hereafter executed between Credit Parties and various
health maintenance organizations and all proceeds therefrom.
CASH EQUIVALENTS means: (i) marketable securities (A) issued or
directly and unconditionally guaranteed as to interest and principal by the
United States government or (B) issued by any agency of the United States
government the obligations of which are backed by the full faith and credit of
the United States, in each case maturing within one (1) year after acquisition
thereof; (ii) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof, in each case maturing within one year after acquisition
thereof and having, at the time of acquisition, a rating of at least A-1 from
S&P or at least P-1 from ▇▇▇▇▇'▇; (iii) commercial paper maturing no more than
A-4
one year from the date of acquisition and, at the time of acquisition, having a
rating of at least A-1 from S&P or at least P-1 from ▇▇▇▇▇'▇; (iv) certificates
of deposit or bankers' acceptances issued or accepted by any Lender or by any
commercial bank organized under the laws of the United States of America or any
state thereof or the District of Columbia that is at least (A) "adequately
capitalized" (as defined in the regulations of its primary Federal banking
regulator) and (B) has Tier 1 capital (as defined in such regulations) of not
less than $250,000,000, in each case maturing within one year after issuance or
acceptance thereof; and (v) shares of any money market mutual or similar funds
that (A) has substantially all of its assets invested continuously in the types
of investments referred to in clauses (i) through (iv) above, (B) has net assets
of not less than $500,000,000 and (C) has the highest rating obtainable from
either S&P or ▇▇▇▇▇'▇.
CERTIFICATE OF EXEMPTION has the meaning ascribed to it in SECTION
1.9(C).
CHANGE OF CONTROL means any of the following: (a) any person or group
of persons (within the meaning of the Securities Exchange Act of 1934) shall
have acquired beneficial ownership (within the meaning of Rule 13d-3 promulgated
by the Securities and Exchange Commission under the Securities Exchange Act of
1934) of 30% or more of the issued and outstanding shares of Stock of Holdings
having the right to vote for the election of directors of Holdings under
ordinary circumstances; (b) during any period of twelve consecutive calendar
months, individuals who at the beginning of such period constituted the board of
directors of Holdings (together with any new directors whose election by the
board of directors of Holdings or whose nomination for election by the
Stockholders of Holdings was approved by a vote of at least two-thirds of the
directors then still in office who either were directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason other than death or disability to constitute a
majority of the directors then in office; (c) Holdings ceases to own and control
all of the economic and voting rights associated with all of the outstanding
Stock of Borrower, (d) Borrower ceases to own and control all of the economic
and voting rights associated with all of the outstanding Stock of any of its
Subsidiaries, (e) Dr. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ceases to own, directly or indirectly, at
least ninety five percent (95%) of the economic and voting rights of ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ Radiology and ProNet or (e) any "Change of Control" shall occur (as such
term is defined in any agreement governing Subordinated Debt).
CHARGES means all federal, state, county, city, municipal, local,
foreign or other governmental premiums and other amounts (including premiums and
other amounts owed to the PBGC at the time due and payable), levies,
assessments, charges, liens, claims or encumbrances upon or relating to (a) the
Collateral, (b) the Obligations, (c) the employees, payroll, income or gross
receipts of any Credit Party, (d) any Credit Party's ownership or use of any
properties or other assets, or (e) any other aspect of any Credit Party's
business.
CHATTEL PAPER means any "chattel paper," as such term is defined in the
Code, including electronic chattel paper, now owned or hereafter acquired by any
Credit Party, wherever located.
CLOSING CHECKLIST means the schedule, including all appendices,
exhibits or schedules thereto, listing certain documents and information to be
delivered in connection with the Agreement, the other Loan Documents and the
transactions contemplated thereunder, substantially in the form attached hereto
as ANNEX C.
A-5
CLOSING DATE means March __, 2006.
CODE means the Uniform Commercial Code as the same may, from time to
time, be enacted and in effect in the State of New York; PROVIDED, that to the
extent that the Code is used to define any term herein or in any Loan Document
and such term is defined differently in different Articles or Divisions of the
Code, the definition of such term contained in Article or Division 9 shall
govern; PROVIDED FURTHER, that in the event that, by reason of mandatory
provisions of law, any or all of the attachment, perfection or priority of, or
remedies with respect to, Agent's or any Lender's Lien on any Collateral is
governed by the Uniform Commercial Code as enacted and in effect in a
jurisdiction other than the State of New York, the term "Code" shall mean the
Uniform Commercial Code as enacted and in effect in such other jurisdiction
solely for purposes of the provisions thereof relating to such attachment,
perfection, priority or remedies and for purposes of definitions related to such
provisions.
COLLATERAL means the property covered by the Security Agreement and the
other Collateral Documents and any other property, real or personal, tangible or
intangible, now existing or hereafter acquired, that may at any time be or
become subject to a security interest or Lien in favor of Agent, on behalf of
itself and Lenders, to secure the Obligations or any portion thereof.
COLLATERAL DOCUMENTS means the Security Agreement, the Pledge
Agreements, the Guaranties, the Patent Security Agreements, the Trademark
Security Agreements, the Copyright Security Agreements and all similar
agreements entered into guaranteeing payment of, or granting a Lien upon
property as security for payment of, the Obligations or any portion thereof.
COMMITMENT TERMINATION DATE means the earliest of (a) March __, 2011,
(b) if the Subordinated Notes have not been refinanced, extended or discharged
by December 31, 2007 with Indebtedness which has a final maturity date no
earlier than September __, 2012 (unless refinanced in full with the the
Incremental Term Loan C, in which case the final maturity date may be no earlier
than March __, 2012) and on other terms acceptable to Agent and Requisite
Lenders, December 31, 2007 (c) the date of termination of Lenders' obligations
to make Advances and to incur Letter of Credit Obligations or permit existing
Loans to remain outstanding pursuant to SECTION 7.3, and (d) the date of (i)
indefeasible prepayment in full by Borrower of the Loans, (ii) the cancellation
and return (or stand-by guarantee) of all Letters of Credit or the cash
collateralization or, with the consent of Agent in each instance, the backing
with standby letters of credit acceptable to Agent, of all Letter of Credit
Obligations pursuant to and in the amount required by SECTION 1.5(F), and (iii)
the permanent reduction of the Commitments to zero dollars ($0).
COMMITMENTS means (a) as to any Lender, the aggregate of such Lender's
Revolving Loan Commitment and Term Loan B Commitment as set forth on ANNEX B to
the Agreement or in the most recent Assignment Agreement executed by such Lender
and (b) as to all Lenders, the aggregate of all Lenders' Revolving Loan
Commitments and Term Loan B Commitments, which aggregate commitment shall be ONE
HUNDRED MILLION DOLLARS ($100,000,000) on the Closing Date, as such Commitments
may be reduced, amortized or adjusted from time to time in accordance with this
Agreement.
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COMMUNICATION means any notice, information or other communication
required or permitted to be given or made under this Agreement, but excluding
any Loan Document requested by Agent to be delivered solely in a signed writing,
including without limitation, any mortgage, Note, power of attorney, or Patent,
Trademark or Copyright Security Agreement.
COMPLIANCE AND EXCESS CASH FLOW CERTIFICATE has the meaning ascribed to
it in SECTION 6.2(O).
CONSOLIDATED NET INCOME has the meaning ascribed to it in SECTION
6.1(B) of SCHEDULE 1 to ANNEX F.
CONTINGENT OBLIGATION means, as applied to any Person, any direct or
indirect liability of that Person: (i) with respect to Guaranteed Indebtedness
and with respect to any Indebtedness, lease, dividend or other obligation of
another Person if the purpose or intent of the Person incurring such liability,
or the effect thereof, is to provide assurance to the obligee of such liability
that such liability will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such liability will be
protected (in whole or in part) against loss with respect thereto; (ii) with
respect to any letter of credit issued for the account of that Person or as to
which that Person is otherwise liable for reimbursement of drawings; (iii) under
any foreign exchange contract, currency swap agreement, interest rate swap
agreement (including Interest Rate Agreements) or other similar agreement or
arrangement designed to alter the risks of that Person arising from fluctuations
in currency values or interest rates, (iv) any agreement, contract or
transaction involving commodity options or future contracts, (v) to make
take-or-pay or similar payments if required regardless of nonperformance by any
other party or parties to an agreement, or (vi) pursuant to any agreement to
purchase, repurchase or otherwise acquire any obligation or any property
constituting security therefor, to provide funds for the payment or discharge of
such obligation or to maintain the solvency, financial condition or any balance
sheet item or level of income of another. The amount of any Contingent
Obligation shall be equal to the amount of the obligation so guaranteed or
otherwise supported or, if not a fixed and determined amount, the maximum amount
so guaranteed.
CONTRACTUAL OBLIGATIONS means, as applied to any Person, any indenture,
mortgage, deed of trust, contract, undertaking, agreement or other instrument to
which that Person is a party or by which it or any of its properties is bound or
to which it or any of its properties is subject including the Related
Transactions Documents.
CONTROL AGREEMENT means a tri-party deposit account, securities account
or commodities account control agreements by and among the applicable Credit
Party, Agent and the depository, securities intermediary or commodities
intermediary, and each in form and substance reasonably satisfactory in all
respects to Agent and in any event providing to Agent "control" of such deposit
account, securities or commodities account within the meaning of Articles 8 and
9 of the Code.
COPYRIGHT LICENSE means any and all rights now owned or hereafter
acquired by any Credit Party under any written agreement granting any right to
such Credit Party to use any Copyright or Copyright registration owned by a
third party.
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COPYRIGHT SECURITY AGREEMENTS means the Copyright Security Agreements
made in favor of Agent, on behalf of itself and Lenders, by each applicable
Credit Party.
COPYRIGHTS means all of the following now owned or hereafter adopted or
acquired by any Credit Party: (a) all copyrights and General Intangibles of like
nature (whether registered or unregistered), all registrations and recordings
thereof, and all applications in connection therewith, including all
registrations, recordings and applications in the United States Copyright Office
or in any similar office or agency of the United States, any state or territory
thereof, or any other country or any political subdivision thereof; and (b) all
reissues, extensions or renewals thereof.
CREDIT PARTIES means Holdings, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Radiology, ProNet,
Borrower and each other Person (i) which executes this Agreement as a "Credit
Party," (ii) which executes a Guaranty, (iii) which grants a Lien on all or
substantially all of its assets to secure payment of the Obligations and (iv)
all of the Stock of which is pledged to Agent for the benefit of itself and
Lenders.
CURRENT ASSETS means, with respect to any Person, all current assets of
such Person as of any date of determination calculated in accordance with GAAP,
but excluding cash, cash equivalents and debts due from Affiliates.
CURRENT LIABILITIES means, with respect to any Person, all liabilities
that should, in accordance with GAAP, be classified as current liabilities, and
in any event shall include all Indebtedness payable on demand or within one year
from any date of determination without any option on the part of the obligor to
extend or renew beyond such year, all accruals for federal or other taxes based
on or measured by income and payable within such year, but excluding the current
portion of long-term debt required to be paid within one year and the aggregate
outstanding principal balances of the Revolving Loan and the Swing Line Loan.
DAYS SALES OUTSTANDING means (a) the gross Accounts of Holdings and its
Subsidiaries DIVIDED BY (b) the quotient of the gross sales (excluding revenues
associated with Capitated Contracts) of Holdings and its Subsidiaries for the
preceding twelve (12) months of any date of determination DIVIDED BY 365.
DEFAULT means any event that, with the passage of time or notice or
both, would, unless cured or waived, become an Event of Default.
DEFAULT RATE has the meaning ascribed to it in SECTION 1.2(D).
DISBURSEMENT ACCOUNT has the meaning ascribed to it in SECTION 1.1(E).
DISCHARGE OF FIRST LIEN OBLIGATIONS has the meaning ascribed to it in
the Intercreditor Agreement.
DISCLOSURE SCHEDULES means the Schedules prepared by Borrower and
denominated as SCHEDULES 1.1(A) THROUGH 5.19 in the index to the Agreement.
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DOCUMENTS means any "document," as such term is defined in the Code,
including electronic documents, now owned or hereafter acquired by any Credit
Party, wherever located.
DOLLARS or $ means lawful currency of the United States of America.
DOMESTIC CREDIT PARTIES means any Credit Party organized under the laws
of a jurisdiction in the United States of America.
DOMESTIC SUBSIDIARIES means any Subsidiary organized under the laws of
a jurisdiction in the United States of America.
EBITDA has the meaning ascribed to it in SCHEDULE II to EXHIBIT 6.2(D).
ELECTRONIC TRANSMISSION means each document, instruction,
authorization, file, information and any other communication transmitted, posted
or otherwise made or communicated by e-mail or E-Fax, or otherwise to or from an
E-System or other equivalent service.
ENVIRONMENTAL LAWS means all applicable federal, state, local and
foreign laws, statutes, ordinances, codes, rules, standards and regulations, now
or hereafter in effect, and any legally binding applicable judicial or
administrative interpretation thereof, including any applicable judicial or
administrative order, consent decree, order or judgment, imposing liability or
standards of conduct for or relating to the regulation and protection of human
health, safety and the environment (including ambient air, surface water,
groundwater, wetlands, land surface or subsurface strata). Environmental Laws
include the Comprehensive Environmental Response, Compensation, and Liability
Act of 1980 (42 U.S.C. ▇▇.▇▇. 9601 ET SEQ.) ("CERCLA"); the Hazardous Materials
Transportation Authorization Act of 1994 (49 U.S.C. ▇▇.▇▇. 5101 ET SEQ.); the
Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. ▇▇.▇▇. 136 ET
SEQ.); the Solid Waste Disposal Act (42 U.S.C. ▇▇.▇▇. 6901 ET SEQ.); the Toxic
Substance Control Act (15 U.S.C. ▇▇.▇▇. 2601 ET SEQ.); the Clean Air Act (42
U.S.C. ▇▇.▇▇. 7401 ET SEQ.); the Federal Water Pollution Control Act (33 U.S.C.
▇▇.▇▇. 1251 ET SEQ.); the Occupational Safety and Health Act (29 U.S.C. ▇▇.▇▇.
651 ET SEQ.); and the Safe Drinking Water Act (42 U.S.C. ▇▇.▇▇. 300(f) ET SEQ.),
and any and all regulations promulgated thereunder, and all analogous state,
local and foreign counterparts or equivalents and any transfer of ownership
notification or approval statutes.
ENVIRONMENTAL LIABILITIES means, with respect to any Person, all
liabilities, obligations, responsibilities, response, remedial and removal
costs, investigation and feasibility study costs, capital costs, operation and
maintenance costs, losses, damages, punitive damages, property damages, natural
resource damages, consequential damages, treble damages, costs and expenses
(including all reasonable fees, disbursements and expenses of counsel, experts
and consultants), fines, penalties, sanctions and interest incurred as a result
of or related to any claim, suit, action, investigation, proceeding or demand by
any Person, whether based in contract, tort, implied or express warranty, strict
liability, criminal or civil statute or common law, including any arising under
or related to any Environmental Laws, Environmental Permits, or in connection
with any Release or threatened Release or presence of a Hazardous Material
whether on, at, in, under, from or about or in the vicinity of any real or
personal property.
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ENVIRONMENTAL PERMITS means all permits, licenses, authorizations,
certificates, approvals or registrations required by any Governmental Authority
under any Environmental Laws.
EQUIPMENT means all "equipment," as such term is defined in the Code,
now owned or hereafter acquired by any Credit Party, wherever located and, in
any event, including all such Credit Party's machinery and equipment, including
processing equipment, conveyors, machine tools, data processing and computer
equipment, including embedded software and peripheral equipment and all
engineering, processing and manufacturing equipment, office machinery,
furniture, materials handling equipment, tools, attachments, accessories,
automotive equipment, trailers, trucks, forklifts, molds, dies, stamps, motor
vehicles, rolling stock and other equipment of every kind and nature, trade
fixtures and fixtures not forming a part of real property, together with all
additions and accessions thereto, replacements therefor, all parts therefor, all
substitutes for any of the foregoing, fuel therefor, and all manuals, drawings,
instructions, warranties and rights with respect thereto, and all products and
proceeds thereof and condemnation awards and insurance proceeds with respect
thereto.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and all regulations promulgated thereunder.
ERISA AFFILIATE means, with respect to any Credit Party, any trade or
business (whether or not incorporated) that, together with such Credit Party,
are treated as a single employer under Section 4001(b)(1) of ERISA or Sections
414(b), (c), (m) or (o) of the IRC.
ERISA EVENT means, with respect to any Credit Party or any ERISA
Affiliate, (a) any event described in Section 4043 of ERISA with respect to a
Title IV Plan; (b) the withdrawal of any Credit Party or ERISA Affiliate from a
Title IV Plan subject to Section 4063 of ERISA during a plan year in which it
was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (c) the
complete or partial withdrawal of any Credit Party or any ERISA Affiliate from
any Multiemployer Plan; (d) the filing of a notice of intent to terminate a
Title IV Plan or the treatment of a plan amendment as a termination under
Section 4041 of ERISA; (e) the institution of proceedings to terminate a Title
IV Plan or Multiemployer Plan by the PBGC; (f) the failure by any Credit Party
or ERISA Affiliate to make when due required contributions to a Multiemployer
Plan or Title IV Plan unless such failure is cured within 30 days; (g) any other
event or condition that might reasonably be expected to constitute grounds under
Section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Title IV Plan or Multiemployer Plan or for the imposition of
liability under Section 4069 or 4212(c) of ERISA; (h) the termination of a
Multiemployer Plan under Section 4041A of ERISA or the reorganization or
insolvency of a Multiemployer Plan under Section 4241 or 4245 of ERISA; or (i)
the loss of a Qualified Plan's qualification or tax exempt status; or (j) the
termination of a Plan described in Section 4064 of ERISA.
E-SIGNATURE means the process of attaching to or logically associating
with an Electronic Transmission an electronic symbol, encryption, digital
signature or process (including the name or an abbreviation of the name of the
party transmitting the Electronic Transmission) with the intent to sign,
authenticate or accept such Electronic Transmission.
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E-SYSTEM means any electronic system, including Intralinks(R) and any
other Internet or extranet-based site, whether such electronic system is owned,
operated or hosted by the Agent or any other Person, providing for access to
data protected by passcodes or other security system.
EVENT OF DEFAULT has the meaning ascribed to it in SECTION 7.1.
EXCESS CASH FLOW has the meaning ascribed to it in SCHEDULE 2 to ANNEX
F.
EXCLUDED TAX has the meaning ascribed to it in SECTION 1.9(A).
FACILITIES means the Term Loan Facility and the Revolving Credit
Facility.
FAIR LABOR STANDARDS ACT means the Fair Labor Standards Act, 29 U.S.C.
ss.201 et seq.
FEDERAL FUNDS RATE means, for any day, a floating rate equal to the
weighted average of the rates on overnight federal funds transactions among
members of the Federal Reserve System, as determined by Agent in its sole
discretion, which determination shall be final, binding and conclusive (absent
manifest error).
FEDERAL RESERVE BOARD means the Board of Governors of the Federal
Reserve System.
FEES means any and all fees payable to Agent or any Lender pursuant to
the Agreement or any of the other Loan Documents.
FIELD REVIEW has the meaning ascribed to it in SECTION 4.3.
FINANCIAL STATEMENTS means the consolidated and consolidating income
statements, statements of cash flows and balance sheets of Holdings and its
Subsidiaries delivered in accordance with SECTION 6.2.
FISCAL MONTH means any of the monthly accounting periods of Holdings of
each Fiscal Year.
FISCAL QUARTER means any of the quarterly accounting periods of
Holdings, ending on January 31, April 30, July 31 and October 31 of each year.
FISCAL YEAR means any of the annual accounting periods of Holdings
ending on October 31 of each year.
FIXED CHARGES has the meaning ascribed to it in SECTION 6.1(C) of
SCHEDULE 1 to ANNEX F.
FIXED CHARGE COVERAGE RATIO has the meaning ascribed to it in SECTION
6.1(C) of SCHEDULE 1 to ANNEX F.
FIXTURES means all "fixtures" as such term is defined in the Code, now
owned or hereafter acquired by any Credit Party.
FOREIGN LENDER has the meaning ascribed to it in SECTION 1.9(C).
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FOREIGN SUBSIDIARY means any direct or indirect Subsidiary of Holdings
organized under the laws of a jurisdiction outside of the United States.
FUNDED DEBT means, with respect to any Person, without duplication, all
Indebtedness for borrowed money evidenced by notes, bonds, debentures, or
similar evidences of Indebtedness and that by its terms matures more than one
year from, or is directly or indirectly renewable or extendible at such Person's
option under a revolving credit or similar agreement obligating the lender or
lenders to extend credit over a period of more than one year from the date of
creation thereof, and specifically including Capital Lease Obligations, current
maturities of long-term debt, revolving credit and short-term debt extendible
beyond one year at the option of the debtor, and also including, in the case of
Borrower, the Obligations (including Letter of Credit Obligations), the Second
Lien Loan Obligations and, without duplication, Guaranteed Indebtedness
consisting of guaranties of Funded Debt of other Persons.
FUNDING DATE has the meaning ascribed to it in SECTION 2.2.
GAAP means generally accepted accounting principles in the United
States of America, consistently applied.
GE CAPITAL has the meaning ascribed to it in the Preamble.
GE CAPITAL FEE LETTER has the meaning ascribed to it in SECTION 1.3(A).
GENERAL INTANGIBLES means "general intangibles," as such term is
defined in the Code, now owned or hereafter acquired by any Credit Party,
including all right, title and interest that such Credit Party may now or
hereafter have in or under any Contractual Obligation, all payment intangibles,
customer lists, Licenses, Copyrights, Trademarks, Patents, and all applications
therefor and reissues, extensions or renewals thereof, rights in Intellectual
Property, interests in partnerships, joint ventures and other business
associations, licenses, permits, copyrights, trade secrets, proprietary or
confidential information, inventions (whether or not patented or patentable),
technical information, procedures, designs, knowledge, know-how, software, data
bases, data, skill, expertise, experience, processes, models, drawings,
materials and records, goodwill (including the goodwill associated with any
Trademark or Trademark License), all rights and claims in or under insurance
policies (including insurance for fire, damage, loss and casualty, whether
covering personal property, real property, tangible rights or intangible rights,
all liability, life, key man and business interruption insurance, and all
unearned premiums), uncertificated securities, chooses in action, deposit,
checking and other bank accounts, rights to receive tax refunds and other
payments, rights to receive dividends, distributions, cash, Instruments and
other property in respect of or in exchange for pledged Stock and Investment
Property, rights of indemnification, all books and records, correspondence,
credit files, invoices and other papers, including all tapes, cards, computer
runs and other papers and documents in the possession or under the control of
such Credit Party or any computer bureau or service company from time to time
acting for such Credit Party.
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GOODS means any "goods," as such term is defined in the Code, now owned
or hereafter acquired by any Credit Party, wherever located, including embedded
software to the extent included in "goods" as defined in the Code, manufactured
homes, standing timber that is cut and removed for sale and unborn young of
animals.
GOVERNMENTAL AUTHORITY means any nation or government, any state or
other political subdivision thereof, and any agency, department or other entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
GUARANTEED INDEBTEDNESS means, as to any Person, any obligation of such
Person guaranteeing, providing comfort or otherwise supporting any Indebtedness,
lease, dividend, or other obligation ("PRIMARY OBLIGATION") of any other Person
(the "PRIMARY OBLIGOR") in any manner, including any obligation or arrangement
of such Person to (a) purchase or repurchase any such primary obligation, (b)
advance or supply funds (i) for the purchase or payment of any such primary
obligation or (ii) to maintain working capital or equity capital of the primary
obligor or otherwise to maintain the net worth or solvency or any balance sheet
condition of the primary obligor, (c) purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary
obligation, (d) protect the beneficiary of such arrangement from loss (other
than product warranties given in the ordinary course of business) or (e)
indemnify the owner of such primary obligation against loss in respect thereof.
The amount of any Guaranteed Indebtedness at any time shall be deemed to be an
amount equal to the lesser at such time of (x) the stated or determinable amount
of the primary obligation in respect of which such Guaranteed Indebtedness is
incurred and (y) the maximum amount for which such Person may be liable pursuant
to the terms of the instrument embodying such Guaranteed Indebtedness, or, if
not stated or determinable, the maximum reasonably anticipated liability
(assuming full performance) in respect thereof.
GUARANTIES means, that Guaranty executed as of the closing date by
Holdings, ▇▇▇▇▇▇▇ and Borrower's Subsidiaries, and any other guaranty executed
by any Guarantor in favor of Agent and Lenders in respect of the Obligations.
GUARANTORS means Holdings, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Radiology, ProNet, each
Domestic Subsidiary of Borrower and each other Person, if any, that executes a
guaranty or other similar agreement in favor of Agent, for itself and the
ratable benefit of Lenders, in connection with the transactions contemplated by
the Agreement and the other Loan Documents.
HAZARDOUS MATERIAL means any substance, material or waste that is
regulated by, or forms the basis of liability now or hereafter under, any
Environmental Laws, including any material or substance that is (a) defined as a
"solid waste," "hazardous waste," "hazardous material," "hazardous substance,"
"dangerous goods," "extremely hazardous waste," "restricted hazardous waste,"
"pollutant," "contaminant," "hazardous constituent," "special waste," "toxic
substance" or other similar term or phrase under any Environmental Laws, or (b)
petroleum or any fraction or by-product thereof, asbestos, polychlorinated
biphenyls (PCB's), or any radioactive substance.
HEALTH CARE LAWS means (i) any and all federal, state and local fraud
and abuse laws, including, without limitation, the federal Anti-Kickback Statute
(42 U.S.C. ss. 1320a-7(b)), the ▇▇▇▇▇ Law (42 U.S.C. ss. 1395nn and ss.1395(q)),
the civil False Claims Act (31 U.S.C. ss. 3729 et seq.), Sections 1320a-7 and
1320a-7a of Title 42 of the United States Code and the regulations promulgated
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pursuant to such statutes; (ii) the federal Food, Drug & Cosmetic Act (21 U.S.C.
▇▇.▇▇. 301 et seq.) and the regulations promulgated thereunder, (iii) the Health
Insurance Portability and Accountability Act of 1996 (Pub. L. No. 104-191) and
the regulations promulgated thereunder, (iv) Medicare (Title XVIII of the Social
Security Act) and the regulations promulgated thereunder; (v) Medicaid (Title
XIX of the Social Security Act) and the regulations promulgated thereunder; (vi)
the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub.
L. No. 108-173) and the regulations promulgated thereunder; (vii) quality,
safety and accreditation standards and requirements of all applicable state laws
or regulatory bodies; (viii) Requirements of Law relating to the ownership or
operation of a health care facility or business, or assets used in connection
therewith, (ix) Requirements of Law relating to the billing or submission of
claims, collection of accounts receivable, underwriting the cost of, or
provision of management or administrative services in connection with, any and
all of the foregoing, by any Credit Party and any of their Subsidiaries,
including, but not limited to, laws and regulations relating to practice of
medicine and other health care professions, professional fee splitting,
tax-exempt organization and charitable trust law applicable to health care
organizations, certificates of need, certificates of operations and authority,
and (x) any and all other applicable health care laws, regulations, manual
provisions, policies and administrative guidance, each of (i) through (x) as may
be amended from time to time.
HOLDINGS has the meaning ascribed thereto in the recitals to the
Agreement.
HOLDINGS GUARANTY means the guaranty of even date herewith executed by
Holdings in favor of Agent, on behalf of itself and Lenders.
HOLDINGS PLEDGE AGREEMENT means the Pledge Agreement of even date
herewith executed by Holdings in favor of Agent, on behalf of itself and
Lenders, pledging all the Stock of Borrower and all Intercompany Notes owing to
or held by it.
INCREMENTAL TERM LOAN C mans the "Incremental Term Loan C" as defined
in the Second Lien Credit Agreement as in effect on the Closing Date.
INDEBTEDNESS means, with respect to any Person, without duplication (a)
all indebtedness of such Person for borrowed money or for the deferred purchase
price of property payment for which is deferred six (6) months or more, but
excluding obligations to trade creditors incurred in the ordinary course of
business that are unsecured and not overdue by more than six (6) months unless
being contested in good faith, (b) all reimbursement and other obligations with
respect to letters of credit, bankers' acceptances and surety bonds, whether or
not matured, (c) all obligations evidenced by notes, bonds, debentures or
similar instruments, (d) all indebtedness created or arising under any
conditional sale or other title retention agreement with respect to property
acquired by such Person (even though the rights and remedies of the seller or
lender under such agreement in the event of default are limited to repossession
or sale of such property), (e) all Capital Lease Obligations and the present
value (discounted at the Index Rate as in effect on the Closing Date) of future
rental payments under all synthetic leases, (f) all obligations of such Person
under commodity purchase or option agreements or other commodity price hedging
arrangements, in each case whether contingent or matured, (g) all net payment
obligations of such Person under any foreign exchange contract, currency swap
agreement, interest rate swap (including Interest Rate Agreements), cap or
collar agreement or other similar agreement or arrangement designed to alter the
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risks of that Person arising from fluctuations in currency values or interest
rates, in each case whether contingent or matured, (h) all Indebtedness referred
to above secured by (or for which the holder of such Indebtedness has an
existing right, contingent or otherwise, to be secured by) any Lien upon or in
property or other assets (including accounts and contract rights) owned by such
Person, even though such Person has not assumed or become liable for the payment
of such Indebtedness, (i) "earnouts" and similar payment obligations excluding
bonus, phantom stock or other similar compensation payments owed to employees,
or officers and incurred in the ordinary course of business, (j) the Second Lien
Obligations and (k) the Obligations.
INDEMNITEES has the meaning ascribed to it in SECTION 9.1.
INDENTURE means that certain First Supplemental Indenture dated as of
October 30, 2003 to Indenture dated as of June 25, 1993 between Holdings and
American Stock Transfer & Trust Company, as trustee, relating to the
Subordinated Notes.
INDEX RATE means, for any day, a floating rate equal to the higher of
(i) the rate publicly quoted from time to time by THE WALL STREET JOURNAL as the
"base rate on corporate loans posted by at least 75% of the nation's 30 largest
banks" (or, if THE WALL STREET JOURNAL ceases quoting a base rate of the type
described, the highest per annum rate of interest published by the Federal
Reserve Board in Federal Reserve statistical release H.15 (519) entitled
"Selected Interest Rates" as the Bank prime loan rate or its equivalent), and
(ii) the Federal Funds Rate plus 50 basis points per annum. Each change in any
interest rate provided for in the Agreement based upon the Index Rate shall take
effect at the time of such change in the Index Rate.
INDEX RATE LOAN means a Loan or portion thereof bearing interest by
reference to the Index Rate.
INSTRUMENTS means all "instruments," as such term is defined in the
Code, now owned or hereafter acquired by any Credit Party, wherever located,
and, in any event, including all certificated securities, all certificates of
deposit, and all promissory notes and other evidences of indebtedness, other
than instruments that constitute, or are a part of a group of writings that
constitute, Chattel Paper.
INTELLECTUAL PROPERTY means any and all Licenses, Patents, Copyrights,
Trademarks, and the goodwill associated with such Trademarks.
INTERCOMPANY DEBT has the meaning ascribed to it in SECTION 9.21.
INTERCOMPANY NOTES means a promissory note contemplated by SECTION
5.1(E).
INTERCREDITOR AGREEMENT means that certain Intercreditor Agreement,
dated as of the Closing Date, among the Agent, the Second Lien Agent (as defined
therein) and the Credit Parties, as amended, restated, supplemented and
otherwise modified from time to time.
INTEREST EXPENSE has the meaning ascribed to it in SECTION 6.1(C) of
SCHEDULE 1 to ANNEX F.
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INTEREST PAYMENT DATE means (a) as to any Index Rate Loan, the first
Business Day of each month to occur while such Loan is outstanding, and (b) as
to any LIBOR Loan, the last day of the applicable LIBOR Period; PROVIDED, that
in the case of any LIBOR Period greater than three months in duration, interest
shall be payable at three month intervals and on the last day of such LIBOR
Period; and PROVIDED FURTHER that, in addition to the foregoing, each of (x) the
date upon which all of the Commitments have been terminated and the Loans have
been paid in full and (y) the Commitment Termination Date shall be deemed to be
an "INTEREST PAYMENT DATE" with respect to any interest that has then accrued
under the Agreement.
INTEREST RATE AGREEMENT means any interest rate swap agreement,
interest rate cap agreement, interest rate collar agreement or similar agreement
or arrangement designed to protect Borrower against fluctuations in interest
rates entered into between Borrower and any Lender pursuant to SECTION 4.10 (and
any other such agreement otherwise agreed to by Agent).
INVENTORY means any "inventory," as such term is defined in the Code,
now owned or hereafter acquired by any Credit Party, wherever located, including
inventory, merchandise, goods and other personal property that are held by or on
behalf of any Credit Party for sale or lease or are furnished or are to be
furnished under a contract of service, or that constitute raw materials, work in
process, finished goods, returned goods, supplies or materials of any kind,
nature or description used or consumed or to be used or consumed in such Credit
Party's business or in the processing, production, packaging, promotion,
delivery or shipping of the same, including all supplies and embedded software.
INVESTMENt means (i) any direct or indirect purchase or other
acquisition by Borrower or any of its Subsidiaries of any Stock, or other
ownership interest in, any other Person, and (ii) any direct or indirect loan,
advance or capital contribution by Borrower or any of its Subsidiaries to any
other Person, including all indebtedness and accounts receivable due from that
other Person that are not current assets and did not arise from sales to that
other Person in the ordinary course of business.
INVESTMENT PROPERTY means all "investment property," as such term is
defined in the Code, now owned or hereafter acquired by any Credit Party,
wherever located, including: (i) all securities, whether certificated or
uncertificated, including stocks, bonds, interests in limited liability
companies, partnership interests, treasuries, certificates of deposit, and
mutual fund shares; (ii) all securities entitlements of any Credit Party,
including the rights of such Credit Party to any securities account and the
financial assets held by a securities intermediary in such securities account
and any free credit balance or other money owing by any securities intermediary
with respect to that account; (iii) all securities accounts of any Credit Party;
(iv) all commodity contracts of any Credit Party; and (v) all commodity accounts
held by any Credit Party.
IRC means the Internal Revenue Code of 1986, as amended, and all
regulations promulgated thereunder.
IRS means the United States Internal Revenue Service.
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L/C ISSUER means GE Capital or a Subsidiary thereof or a bank or other
legally authorized Person selected by or acceptable to Agent in its sole
discretion, in such Person's capacity as an issuer of Letters of Credit
hereunder.
L/C SUBLIMIT has the meaning ascribed to it in SECTION 1.1(D).
LENDERS means GE Capital, the other Lenders named on the signature
pages of the Agreement, and, if any such Lender shall decide to assign all or
any portion of the Obligations, such term shall include any assignee of such
Lender.
LETTERS OF CREDIT means documentary or standby letters of credit issued
for the account of Borrower by L/C Issuers, and bankers' acceptances issued by
Borrower, for which Agent and Lenders have incurred Letter of Credit
Obligations. The term does not include a Swap Related L/C.
LETTER OF CREDIT FEE has the meaning ascribed to it in SECTION 1.3(C).
LETTER OF CREDIT OBLIGATIONS means all outstanding obligations incurred
by Agent and Lenders at the request of Borrower, whether direct or indirect,
contingent or otherwise, due or not due, in connection with the issuance of
Letters of Credit by L/C Issuers or the purchase of a participation as set forth
in SECTION 1.1(D) with respect to any Letter of Credit. The amount of such
Letter of Credit Obligations shall equal the maximum amount that may be payable
by Agent and Lenders thereupon or pursuant thereto.
LEVERAGE RATIO has the meaning ascribed to it in SECTION 6.1(E) of
SCHEDULE 1 to ANNEX F.
LIBOR BREAKAGE COSTS means (i) an amount equal to the amount of any
losses, expenses, liabilities (including, without limitation, any loss
(including interest paid) and lost opportunity cost (consisting of the present
value of the difference between the LIBOR Rate in effect for the Interest Period
and any lower LIBOR Rate in effect at the time of prepayment for the remainder
of that Interest Period) in connection with the re-employment of such funds)
that any Lender may sustain as a result of (a) any default by Borrower in making
any borrowing of, conversion into or continuation of any LIBOR Loan following
Borrower's delivery to Agent of any LIBOR Loan request in respect thereof or (b)
any payment of a LIBOR Loan on any day that is not the last day of the LIBOR
Period applicable thereto (regardless of the source of such prepayment and
whether voluntary, by acceleration or otherwise) and (ii) an administrative fee
in an amount equal to $250.00. For purposes of calculating amounts payable to a
Lender under SECTION 1.3(E), each Lender shall be deemed to have actually funded
its relevant LIBOR Loan through the purchase of a deposit bearing interest at
LIBOR in an amount equal to the amount of that LIBOR Loan and having a maturity
and repricing characteristics comparable to the relevant LIBOR Period; PROVIDED,
HOWEVER, that each Lender may fund each of its LIBOR Loans in any manner it sees
fit, and the foregoing assumption shall be utilized only for the calculation of
amounts payable under SECTION 1.3(D).
LIBOR BUSINESS DAY means a Business Day on which banks in the City of
London are generally open for interbank or foreign exchange transactions.
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LIBOR LOANS means a Loan or any portion thereof bearing interest by
reference to the LIBOR Rate.
LIBOR PERIOD means, with respect to any LIBOR Loan, each period
commencing on a LIBOR Business Day selected by Borrower pursuant to the
Agreement and ending one, two, three or six months thereafter, as selected by
Borrower's irrevocable notice to Agent as set forth in SECTION 1.2(E); PROVIDED,
that the foregoing provision relating to LIBOR Periods is subject to the
following:
(a) if any LIBOR Period would otherwise end on a day
that is not a LIBOR Business Day, such LIBOR Period shall be extended to the
next succeeding LIBOR Business Day unless the result of such extension would be
to carry such LIBOR Period into another calendar month in which event such LIBOR
Period shall end on the immediately preceding LIBOR Business Day;
(b) any LIBOR Period that would otherwise extend
beyond the date set forth in clause (a) of the definition of "Commitment
Termination Date" shall end two (2) LIBOR Business Days prior to such date;
(c) any LIBOR Period that begins on the last LIBOR
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such LIBOR Period) shall
end on the last LIBOR Business Day of a calendar month;
(d) Borrower shall select LIBOR Periods so as not to
require a payment or prepayment of any LIBOR Loan during a LIBOR Period for such
Loan;
(e) Borrower shall select LIBOR Periods so that there
shall be no more than 5 separate LIBOR Loans in existence at any one time; and
(f) no LIBOR Period may be selected for any portion
of the Term Loan B if a Scheduled Installment for such Term Loan B is payable
during such LIBOR Period and the portion of such Term Loan B which constitutes
an Index Rate Loan does not equal or exceed the amount of such Scheduled
Installment.
LIBOR RATE means for each LIBOR Period, a rate of interest determined
by Agent equal to:
(a) the offered rate for deposits in United States
Dollars for the applicable LIBOR Period that appears on Telerate Page 3750 as of
11:00 a.m. (London time), on the second full LIBOR Business Day next preceding
the first day of such LIBOR Period (unless such date is not a Business Day, in
which event the next succeeding Business Day will be used); divided by
(b) a number equal to 1.0 MINUS the aggregate (but
without duplication) of the rates (expressed as a decimal fraction) of reserve
requirements in effect on the day that is two (2) LIBOR Business Days prior to
the beginning of such LIBOR Period (including basic, supplemental, marginal and
emergency reserves under any regulations of the Federal Reserve Board or other
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Governmental Authority having jurisdiction with respect thereto, as now and from
time to time in effect) for Eurocurrency funding (currently referred to as
"Eurocurrency Liabilities" in Regulation D of the Federal Reserve Board that are
required to be maintained by a member bank of the Federal Reserve System.
If such interest rates shall cease to be available from Telerate News
Service, the LIBOR Rate shall be determined from such financial reporting
service or other information as shall be available to Agent.
LICENSE means any Copyright License, Patent License, Trademark License
or other license of rights or interests now held or hereafter acquired by any
Credit Party.
LIEN means any mortgage or deed of trust, pledge, hypothecation,
assignment, deposit arrangement, lien, charge, claim, security interest,
easement or encumbrance, or preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including any lease
or title retention agreement, any financing lease having substantially the same
economic effect as any of the foregoing, and the filing of, or agreement to
give, any financing statement perfecting a security interest under the Code or
comparable law of any jurisdiction).
LITIGATION has the meaning ascribed to it in SECTION 6.2(K).
LOAN ACCOUNT has the meaning ascribed to it in SECTION 1.7.
LOAN DOCUMENTS means the Agreement, the Notes, the Collateral
Documents, the GE Capital Fee Letter, the Intercreditor Agreement, the
subordination provisions applicable to any Subordinated Debt and intercreditor
provisions applicable to any Indebtedness that is PARI PASSU in right of payment
to the Obligations and all other agreements, instruments, documents and
certificates identified in the Closing Checklist executed and delivered to, or
in favor of, Agent or any Lenders and including all other pledges, powers of
attorney, consents, assignments, contracts, notices, and all other written
matter whether heretofore, now or hereafter executed by or on behalf of any
Credit Party, or any employee of any Credit Party, and delivered to Agent or any
Lender in connection with the Agreement or the transactions contemplated thereby
(other than the Second Lien Loan Documents). Any reference in the Agreement or
any other Loan Document to a Loan Document shall include all appendices,
exhibits or schedules thereto, and all amendments, restatements, supplements or
other modifications thereto, and shall refer to the Agreement or such Loan
Document as the same may be in effect at any and all times such reference
becomes operative.
LOANS means the Revolving Loan, the Swing Line Loan and the Term Loan.
MANAGEMENT AGREEMENT means that certain Amended and Restated Management
and Service Agreement dated as of January 1, 2004, as in effect on the Closing
Date.
MASTER DOCUMENTARY AGREEMENT means the Master Agreement for Documentary
Letters of Credit dated as of the Closing Date between Borrower, as Applicant,
and GE Capital, as Issuer, as the same may be amended, restated, modified and/or
supplemented from time to time including, without limitation, by joinder
thereto.
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MASTER STANDBY AGREEMENT means the Master Agreement for Standby Letters
of Credit dated as of the Closing Date between Borrower, as Applicant, and GE
Capital, as Issuer, as the same may be amended, restated, modified and/or
supplemented from time to time including, without limitation, by joinder
thereto.
MATERIAL ADVERSE EFFECT means a material adverse effect on (a) the
business, assets, operations or financial or other condition of the Credit
Parties considered as a whole, (b) Borrower's ability to pay any of the Loans or
any of the other Obligations in accordance with the terms of the Agreement, (c)
the Collateral or Agent's Liens, on behalf of itself and Lenders, on the
Collateral or the priority of such Liens, or (d) Agent's or any Lender's rights
and remedies under the Agreement and the other Loan Documents.
MAXIMUM AMOUNT means, as of any date of determination, an amount equal
to the Revolving Loan Commitment of all Lenders as of that date.
MAXIMUM LAWFUL RATE has the meaning ascribed to it in SECTION 1.2(F).
▇▇▇▇▇'▇ means ▇▇▇▇▇'▇ Investors Services, Inc.
MULTIEMPLOYER PLAN means a "multiemployer plan" as defined in Section
(3)(7) of ERISA, and to which any Credit Party or ERISA Affiliate is making, is
obligated to make or has made or been obligated to make in the past five years
contributions on behalf of participants who are or were employed by any of them
or withdrawal liability payments.
NET PROCEEDS means cash proceeds received by Borrower or any of its
Subsidiaries from any Asset Disposition (including insurance proceeds, awards of
condemnation, and payments under notes or other debt securities received in
connection with any Asset Disposition), net of (a) the costs of such Asset
Disposition (including taxes attributable to such sale, lease or transfer) and
any commissions and other customary transaction fees, costs and expenses), other
than any costs payable to any Affiliate of a Credit Party (b) amounts applied to
repayment of Indebtedness (other than the Obligations) secured by a Lien
permitted under the Agreement on the asset or property disposed, and (c) any
amounts required to be held in escrow until such time as such amounts are
released from escrow whereupon such amounts shall be considered Net Proceeds.
NON-CONSENTING LENDER has the meaning ascribed to it in SECTION
9.19(C).
NON-EXCLUDED TAXES has the meaning ascribed to it in SECTION 1.9(A).
NON-FUNDING LENDER has the meaning ascribed to it in SECTION 8.5(A).
NOTES means, collectively, the Revolving Notes, the Swing Line Note and
the Term Notes.
NOTICE OF CONVERSION/CONTINUATION has the meaning ascribed to it in
SECTION 1.2(E).
NOTICE OF REVOLVING CREDIT ADVANCE has the meaning ascribed to it in
SECTION 1.1(B).
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OBLIGATIONS means all loans, advances, debts, liabilities and
obligations, for the performance of covenants, tasks or duties or for payment of
monetary amounts (whether or not such performance is then required or
contingent, or such amounts are liquidated or determinable), including Letter of
Credit Obligations and, but only to the extent that the Agent has acknowledged
in writing that such obligations constitute "Obligations" hereunder, obligations
under Interest Rate Agreements, owing by any Credit Party to Agent or any
Lender, and all covenants and duties regarding such amounts, of any kind or
nature, present or future, whether or not evidenced by any note, agreement or
other instrument, arising under the Agreement or any of the other Loan
Documents; PROVIDED, however, that "Obligations" shall not include any
prepayment fees, early termination charges, make-whole premiums or similar
amounts (or any interest, fees, charges or other amounts thereon) owing to any
Prior Lender as a result of payments or prepayments made on or prior to the
Closing Date. This term includes all principal, interest (including all interest
that accrues after the commencement of any case or proceeding by or against any
Credit Party in bankruptcy, whether or not allowed in such case or proceeding),
Fees, Swap Related Reimbursement Obligations, Charges, expenses, attorneys' fees
and any other sum chargeable to any Credit Party under the Agreement or any of
the other Loan Documents.
OPERATING CASH FLOW has the meaning ascribed to it in SECTION 6.1(E) of
SCHEDULE 1 to ANNEX F.
OTHER LENDER has the meaning ascribed to it in SECTION 8.5(D).
OTHER TAXES has the meaning ascribed to it in SECTION 1.9(A).
OVERADVANCE has the meaning ascribed to it in SECTION 1.1(B).
PATENT LICENSE means rights under any written agreement now owned or
hereafter acquired by any Credit Party granting any right to such Credit Party
with respect to any invention on which a Patent owned by a third party is in
existence.
PATENT SECURITY AGREEMENTS means the Patent Security Agreements made in
favor of Agent, on behalf of itself and Lenders, by each applicable Credit
Party.
PATENTS means all of the following in which any Credit Party now holds
or hereafter acquires any interest: (a) all letters patent of the United States
or any other country, all registrations and recordings thereof, and all
applications for letters patent of the United States or of any other country,
including registrations, recordings and applications in the United States Patent
and Trademark Office or in any similar office or agency of the United States,
any State or any other country, and (b) all reissues, continuations,
continuations-in-part or extensions thereof.
PBGC means the Pension Benefit Guaranty Corporation.
PERMITS means any permit, approval, authorization, license,
registration, certification, certificate of authority, variance, permission,
franchise, qualification, order, filing or consent required from a Governmental
Authority or other Person under an applicable Requirement of Law.
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PERMITTED ACQUISITION has the meaning ascribed to in SECTION 5.6.
PERMITTED ENCUMBRANCES means the following encumbrances: (a) Liens for
taxes, assessments or governmental charges or levies not yet due and payable or
Liens for taxes, assessments or governmental charges or levies being contested
in good faith and by appropriate proceedings for which adequate reserves have
been established in accordance with GAAP, excluding federal income tax Liens and
Liens in favor of the PBGC under ERISA; (b) Liens in respect of property or
assets of the Borrower or any of its Subsidiaries imposed by law which were
incurred in the ordinary course of business and which have not arisen to secure
Indebtedness for borrowed money, such as carriers', materialmen's,
warehousemen's and mechanics' Liens, statutory and common law landlord's Liens,
and other similar Liens arising in the ordinary course of business, and which
either (1) do not in the aggregate materially detract from the value of such
property or assets or materially impair the use thereof in the operation of the
business of the Borrower or any of its Subsidiaries or (2) are being contested
in good faith by appropriate proceedings, which proceedings have the effect of
preventing the forfeiture or sale of the property or asset subject to such Lien;
(c) Liens created by or pursuant to this Agreement, the Collateral Documents or
the other Loan Documents; (d) Liens in existence on the Closing Date which are
listed, and the property subject thereto described, on SCHEDULE 5.2, without
giving effect to any extensions or renewals thereof; (e) Liens arising from
judgments, decrees, awards or attachments in circumstances not constituting an
Event of Default, PROVIDED that the amount of cash and property (determined on a
fair market value basis) deposited or delivered to secure the respective
judgment or decree or subject to attachment shall not exceed $250,000 or the
Dollar Equivalent thereof in the aggregate at any time; (f) Liens (other than
any Lien imposed by ERISA) (1) incurred or deposits made in the ordinary course
of business in connection with general insurance maintained by the Borrower and
its Subsidiaries, (2) incurred or deposits made in the ordinary course of
business of the Borrower and its Subsidiaries in connection with workers'
compensation, unemployment insurance and other types of social security, (3) to
secure the performance by the Borrower and its Subsidiaries of tenders,
statutory obligations (other than excise taxes), surety, stay, customs and
appeal bonds, statutory bonds, bids, leases, government contracts, trade
contracts, performance and return of money bonds and other similar obligations
(exclusive of obligations for the payment of borrowed money) to the extent
incurred in the ordinary course of business, (4) to secure the performance by
the Borrower and its Subsidiaries of leases of Real Property, to the extent
incurred or made in the ordinary course of business consistent with past
practices, and (5) other deposits not to exceed $250,000 in the aggregate; (g)
licenses, sublicenses, leases or subleases granted to third Persons in the
ordinary course of business not interfering in any material respect with the
business of the Borrower or any of its Subsidiaries; (h) easements,
rights-of-way, restrictions, minor defects or irregularities in title,
encroachments and other similar charges or encumbrances, in each case not
securing Indebtedness and not interfering in any material respect with the
ordinary conduct of the business of the Borrower or any of its Subsidiaries; (i)
Liens arising from precautionary UCC financing statements regarding operating
leases; (j) Liens created pursuant to or in connection with leases or Capital
Leases permitted pursuant to this Agreement, PROVIDED that (1) such Liens only
serve to secure the payment of rent or Indebtedness arising under such leases or
Capital Leases and (2) the Liens encumbering the assets leased or purported to
be leased under such leases or Capital Leases do not encumber any other assets
of the Borrower or any of its Subsidiaries (other than letters of credit,
payment undertaking agreements, guaranteed investment contracts, deposits of
cash or Cash Equivalents and other credit support arrangements, in each case
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having an aggregate value not exceeding the fair market value of the assets
leased or purported to be leased under such leases or Capital Leases (each of
such values determined at the time when the lease agreement relating to the
relevant lease or Capital Lease is signed and delivered)); (k) (1) those liens,
encumbrances, hypothecs and other matters affecting title to any Real Property
and found reasonably acceptable by the Agent or insured against by title
insurance, (2) as to any particular Real Property at any time, such easements,
encroachments, covenants, rights of way, minor defects, irregularities or
encumbrances on title which would not reasonably be expected to materially
impair such Real Property for the purpose for which it is held by the mortgagor
or grantor thereof, or the lien or hypothec held by the Agent, (3) zoning and
other municipal ordinances which are not violated in any material respect by the
existing improvements and the present use made by the mortgagor or grantor
thereof of the premises, (4) general real estate taxes and assessments not yet
delinquent, (5) any Lien that would be disclosed on a true, correct and complete
survey of the Real Property that does not materially affect the use or enjoyment
of the Real Property as it is currently being used, and (6) such other similar
items as the Agent may consent to (such consent not to be unreasonably
withheld); (l) Liens arising pursuant to purchase money mortgages or security
interests securing Indebtedness representing the purchase price (or financing of
the purchase price within 90 days after the respective purchase) of assets
acquired after the Closing Date, PROVIDED that (1) any such Liens attach only to
the assets so purchased, upgrades thereon and, if the asset so purchased is an
upgrade, the original asset itself (and such other assets financed by the same
financing source), (2) the Indebtedness (other than Indebtedness incurred from
the same financing source to purchase other assets and excluding Indebtedness
representing obligations to pay installation and delivery charges for the
property so purchased) secured by any such Lien does not exceed 100% of the
lesser of the fair market value or the purchase price of the property being
purchased at the time of the incurrence of such Indebtedness and (3) the
Indebtedness secured thereby is permitted to be incurred pursuant to this
Agreement; (m) Liens arising out of consignment or similar arrangements for the
sale of goods entered into by the Borrower or any of its Subsidiaries in the
ordinary course of business; (n) rights of setoff upon deposits of cash in favor
of banks or other depository institutions as permitted by any Control Agreement
or, with respect to deposits of cash not subject to a Control Agreement,
customary rights of setoff in favor of such banks or depository institutions;
(o) Liens securing Second Lien Loan Obligations; and (p) Liens securing
Indebtedness or leases that refinance, refund, extend, renew and/or replace
Indebtedness or leases secured by Liens described in clauses (a) through (n)
above. Anything in the foregoing to the contrary notwithstanding, in no event
shall "Permitted Encumbrances" include any Lien to secure any prepayment fees,
early termination charges, make-whole premiums or similar amounts (or any
interest, fees, charges or other amounts thereon) owing to any Prior Lender as a
result of payment or prepayments made on or prior to the Closing Date.
PERSON means any individual, sole proprietorship, partnership, joint
venture, trust, unincorporated organization, association, corporation, limited
liability company, institution, public benefit corporation, other entity or
government (whether federal, state, county, city, municipal, local, foreign, or
otherwise, including any instrumentality, division, agency, body or department
thereof).
PLAN means, at any time, an "employee benefit plan," as defined in
Section 3(3) of ERISA, that any Credit Party or ERISA Affiliate maintains,
contributes to or has an obligation to contribute to on behalf of its employees.
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PLEDGE AGREEMENTS means Holdings Pledge Agreement, Borrower Pledge
Agreement and any other pledge agreement entered into after the Closing Date by
any Credit Party.
POST-CLOSING AGREEMENT means that certain Post-Closing Matters
Agreement, dated as of the Closing Date, between Borrower and Agent with respect
to certain agreements, documents and instruments to be delivered after the
Closing Date.
PRIOR LENDERS means Bridge Healthcare Finance, LLC, General Electric
Capital Corporation and its Affiliates, Post Advisory Group, LLC, and Lyon
Financial Services, Inc. dba U.S. Bank Portfolio Services (as servicer for
certain Persons).
PRIOR LENDER OBLIGATIONS means certain Indebtedness and other
obligations owing to each of the Prior Lenders.
PRO FORMA means the unaudited consolidated and consolidating balance
sheets of Holdings and its Subsidiaries prepared in accordance with GAAP as of
the Closing Date after giving effect to the Related Transactions. The Pro Forma
is annexed hereto as ANNEX D.
PRO RATA SHARE means with respect to all matters relating to any Lender
(a) with respect to the Revolving Loan, the percentage obtained by dividing (i)
the Revolving Loan Commitment of that Lender by (ii) the aggregate Revolving
Loan Commitments of all Lenders, (b) with respect to the Term Loan B, the
percentage obtained by dividing (i) the Term Loan B Commitment of that Lender by
(ii) the aggregate Term Loan B Commitments of all Lenders, (c) with respect to
all Loans, the percentage obtained by dividing (i) the aggregate Commitments of
that Lender by (ii) the aggregate Commitments of all Lenders, and (d) with
respect to all Loans on and after the Commitment Termination Date, the
percentage obtained by dividing (i) the aggregate outstanding principal balance
of the Loans held by that Lender, by (ii) the outstanding principal balance of
the Loans held by all Lenders, as any such percentages may be adjusted by
assignments pursuant to SECTION 8.1.
PRONET has the meaning ascribed to in the recitals to the Agreement.
PROCEEDING means a proceeding under the United States Bankruptcy Code,
insolvency laws or any similar law in any jurisdiction, in which any Credit
Party or any Subsidiary thereof is a debtor.
PROJECTIONS means Holdings, and its Subsidiaries' forecasted
consolidated and consolidating: (a) balance sheets; (b) profit and loss
statements; (c) cash flow statements; and (d) capitalization statements, all
prepared on a Subsidiary by Subsidiary or division-by-division basis, if
applicable, and otherwise consistent with the historical Financial Statements of
Holdings, together with appropriate supporting details and a statement of
underlying assumptions.
PROPOSED CHANGE has the meaning ascribed to it in SECTION 9.19(C).
QUALIFIED ASSIGNEE means (a) any Lender, any Affiliate of any Lender
and, with respect to any Lender that is an investment fund that invests in
commercial loans, any other investment fund that invests in commercial loans and
that is managed or advised by the same investment advisor as such Lender or by
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an Affiliate of such investment advisor, and (b) any commercial bank, savings
and loan association or savings bank or any other entity which is an "accredited
investor" (as defined in Regulation D under the Securities Act of 1933) which
extends credit or buys loans as one of its businesses, including insurance
companies, mutual funds, lease financing companies and commercial finance
companies, which has a rating of BBB or higher from S&P and a rating of Baa2 or
higher from ▇▇▇▇▇'▇ at the date that it becomes a Lender and which, through its
applicable lending office, is capable of lending to Borrower without the
imposition of any withholding or similar taxes.
QUALIFIED PLAN means a Plan that is intended to be tax-qualified under
Section 401(a) of the IRC.
REAL ESTATE has the meaning ascribed to it in SECTION 3.14.
REFINANCING means the repayment in full by Borrower of the Prior Lender
Obligations on the Closing Date.
REFUNDED SWING LINE LOAN has the meaning ascribed to it in SECTION
1.1(C)(III).
RELATED TRANSACTIONS means the initial borrowing under the Revolving
Loan, the Term Loan B, and the Second Lien Loan on the Closing Date, the
Refinancing, the payment of all Fees, costs and expenses associated with all of
the foregoing and the execution and delivery of all of the Related Transactions
Documents.
RELATED TRANSACTIONS DOCUMENTS means the Loan Documents, the Second
Lien Loan Documents and all other agreements or instruments executed in
connection with the Related Transactions.
RELEASE means any release, threatened release, spill, emission,
leaking, pumping, pouring, emitting, emptying, escape, injection, deposit,
disposal, discharge, dispersal, dumping, leaching or migration of Hazardous
Material in the indoor or outdoor environment, including the movement of
Hazardous Material through or in the air, soil, surface water, ground water or
property.
REPLACEMENT LENDER has the meaning ascribed to it in SECTION 9.19(A).
REQUIREMENTS OF LAW means, as to any Person, the Governing Documents of
such Person, and any law, ordinance, policy, manual provision, guidance,
principle of common law, statute, rule or regulation, or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its assets or to which such Person or
any of its assets is subject including, without limitation, the Securities Act,
the Securities Exchange Act, Regulations T, U and X of the Federal Reserve
Board, ERISA, the Fair Labor Standards Act, the Worker Adjustment and Retraining
Notification Act, Americans with Disabilities Act of 1990, the Social Security
Act, any Health Care Law, Environmental Law, and any certificate of occupancy,
zoning ordinance, building, environmental or land use requirement or Permit or
environmental, labor, employment, occupational safety or health law, rule or
regulation, including Environmental, Health or Safety laws (including, without
limitation, those applicable to the disposal of medical waste).
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REQUISITE LENDERS means Lenders having (a) more than 50% of the
Commitments of all Lenders, or (b) if the Commitments have been terminated, more
than 50% of the aggregate outstanding amount of the Loans.
REQUISITE REVOLVING LENDERS means Lenders having (a) more than 50% of
the Revolving Loan Commitments of all Lenders, or (b) if the Revolving Loan
Commitments have been terminated, more than 50% of the aggregate outstanding
amount of the Revolving Loan (with the Swing Line Loan being attributed to the
Lender making such Loan).
RESTRICTED PAYMENT means, with respect to any Credit Party (a) the
declaration or payment of any dividend or the incurrence of any liability to
make any other payment or distribution of cash or other property or assets in
respect of Stock; (b) any payment on account of the purchase, redemption,
defeasance, sinking fund or other retirement of such Credit Party's Stock or any
other payment or distribution made in respect thereof, either directly or
indirectly; (c) any payment or prepayment of principal of, premium, if any, or
interest, fees or other charges on or with respect to, and any redemption,
purchase, retirement, defeasance, sinking fund or similar payment and any claim
for rescission with respect to, any Subordinated Debt (and payment of prepayment
fees, early termination charges, make-whole premiums or similar amounts
(including any interest, fees, charges or other amounts thereon) to any Prior
Lender owing as a result of the payment or prepayment of obligations on or prior
to the Closing Date); (d) any payment made to redeem, purchase, repurchase or
retire, or to obtain the surrender of, any outstanding warrants, options or
other rights to acquire Stock of such Credit Party now or hereafter outstanding;
(e) any payment of a claim for the rescission of the purchase or sale of, or for
material damages arising from the purchase or sale of, any shares of such Credit
Party's Stock or of a claim for reimbursement, indemnification or contribution
arising out of or related to any such claim for damages or rescission; (f) any
payment, loan, contribution, or other transfer of funds or other property to any
Stockholder of such Credit Party other than payment of compensation in the
ordinary course of business to Stockholders who are employees of such Credit
Party; and (g) any payment of management fees (or other fees of a similar
nature), out-of-pocket expenses in connection therewith and indemnities payable
in connection with any management services, consulting or like agreement by such
Credit Party to any Stockholder of such Credit Party or its Affiliates.
REVOLVING CREDIT ADVANCE has the meaning ascribed to it in SECTION
1.1(B).
REVOLVING CREDIT FACILITY means the Revolving Loan Commitments and the
provisions herein related to the Revolving Loans, Swing Line Loans and Letters
of Credit.
REVOLVING LENDERS means those Lenders having a Revolving Loan
Commitment.
REVOLVING LOAN(S) means, at any time, the sum of (i) the aggregate
amount of Revolving Credit Advances outstanding to Borrower (including Swing
Line Advances) PLUS (ii) the aggregate Letter of Credit Obligations incurred on
behalf of Borrower. Unless the context otherwise requires, references to the
outstanding principal balance of the Revolving Loan shall include the
outstanding balance of Letter of Credit Obligations.
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REVOLVING LOAN COMMITMENT means (a) as to any Lender, the commitment of
such Lender to make its Pro Rata Share of Revolving Credit Advances or incur its
Pro Rata Share of Letter of Credit Obligations (including, in the case of the
Swing Line Lender, its commitment to make Swing Line Advances as a portion of
its Revolving Loan Commitment) as set forth on ANNEX B or in the most recent
Assignment Agreement, if any, executed by such Lender and (b) as to all Lenders,
the aggregate commitment of all Lenders to make the Revolving Credit Advances
(including, in the case of the Swing Line Lender, Swing Line Advances) or incur
Letter of Credit Obligations, which aggregate commitment shall be FIFTEEN
MILLION DOLLARS ($15,000,000) on the Closing Date, as such amount may be
adjusted, if at all, from time to time in accordance with the Agreement.
REVOLVING NOTES has the meaning ascribed to it in SECTION 1.1(B).
S&P means Standard & Poor's Ratings Services, a division of the
▇▇▇▇▇▇-▇▇▇▇ Companies, Inc.
SCHEDULED INSTALLMENTS has the meaning ascribed to it in SECTION
1.1(A).
SECOND LIEN AGENT means the "Agent" under (and as defined in) the
Second Lien Credit Agreement.
SECOND LIEN CREDIT AGREEMENT means that certain Second Lien Credit
Agreement, dated as of the date hereof, by and among the Borrower, the Credit
Parties (as defined therein), the Agent (as defined therein) and the Lenders (as
defined therein), as amended, restated, supplemented, refinanced, refunded,
extended, renewed, replaced or otherwise modified from time to time, in
accordance with the Intercreditor Agreement.
SECOND LIEN LENDERS means the "Lenders" under (and as defined in) the
Second Lien Credit Agreement.
SECOND LIEN LOAN DOCUMENTS means the Second Lien Credit Agreement and
all other agreements, instruments, documents and certificates executed and
delivered in connection therewith, including all other pledges, powers of
attorney, consents, assignments, contracts, notices, and all other written
matter whether heretofore, now or hereafter executed by or on behalf of any
Credit Party, or any employee of any Credit Party, in connection with the Second
Lien Credit Agreement or the transactions contemplated thereby. Any reference in
any of the aforementioned documents shall include all appendices, exhibits or
schedules thereto, and all amendments, restatements, supplements or other
modifications thereto, and shall refer to such documents as the same may be in
effect at any and all times such reference becomes operative.
SECOND LIEN LOAN means the "Term Loan C" as defined in the Second Lien
Credit Agreement.
SECOND LIEN LOAN OBLIGATIONS means the "Obligations" as defined in the
Second Lien Credit Agreement.
SECURED PARTIES means the Lenders, the Agent, each other Indemnitee and
any other holder of any Obligations of any Credit Party.
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SECURITIZATION means a public or private offering by a Lender or any of
its direct or indirect Affiliates or their respective successors and assigns, of
securities which represent an interest in, or which are collateralized, in whole
or in part, by the Loans and the Loan Documents.
SECURITY means all Stock, Stock equivalents, voting trust certificates,
bonds, debentures, instruments and other evidence of Indebtedness, whether or
not secured, convertible or subordinated, all certificates of interest, share or
participation in, all certificates for the acquisition of, and all warrants,
options and other rights to acquire, any Security.
SECURITY AGREEMENT means the Security Agreement of even date herewith
entered into by and among Agent, on behalf of itself and Lenders, and each
Credit Party that is a signatory thereto.
SENIOR DEBT has the meaning ascribed to it in SECTION 6.1(F) of
SCHEDULE 1 to ANNEX F.
SENIOR LEVERAGE RATIO has the meaning ascribed to it in SECTION 6.1(F)
of SCHEDULE 1 to ANNEX F.
SETTLEMENT DATE has the meaning ascribed to it in SECTION 8.5(A)(II).
SOFTWARE means all "software" as such term is defined in the Code, now
owned or hereafter acquired by any Credit Party, other than software embedded in
any category of Goods, including all computer programs and all supporting
information provided in connection with a transaction related to any computer
program.
SOLVENT means, with respect to any Person on a particular date, that on
such date (a) the fair value of the property of such Person is greater than the
total amount of liabilities, including subordinated and contingent liabilities,
of such Person; (b) the present fair saleable value of the assets of such Person
is not less than the amount that will be required to pay the probable liability
of such Person on its debts and liabilities, including subordinated and
contingent liabilities as they become absolute and matured; (c) such Person does
not intend to, and does not believe that it will, incur debts or liabilities
beyond such Person's ability to pay as such debts and liabilities mature; and
(d) such Person is not engaged in a business or transaction, and is not about to
engage in a business or transaction, for which such Person's property would
constitute an unreasonably small capital. The amount of contingent liabilities
(such as Litigation, guaranties and pension plan liabilities) at any time shall
be computed as the amount that, in light of all the facts and circumstances
existing at the time, represents the amount that would be reasonably be expected
to become an actual or matured liability.
STATEMENT has the meaning ascribed to it in SECTION 6.2(B).
STOCK means all shares, options, warrants, general or limited
partnership interests, membership interests or other equivalents (regardless of
how designated) of or in a corporation, partnership, limited liability company
or equivalent entity whether voting or nonvoting, including common stock,
preferred stock or any other "equity security" (as such term is defined in Rule
3a11-1 of the General Rules and Regulations promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934).
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STOCKHOLDER means, with respect to any Person, each holder of Stock of
such Person.
SUBORDINATED DEBT means the Indebtedness of Holdings evidenced by the
Subordinated Notes and any other Indebtedness of any Credit Party subordinated
to the Obligations as to right and time of payment and as to any other rights
and remedies thereunder and having such other terms as are reasonably
satisfactory to Agent and Requisite Lenders.
SUBORDINATED NOTES means those certain 11.5% Series A Convertible
Subordinated Debentures Due June, 30 2008 issued by Holdings in an aggregate
original principal amount of $16,147,000.
SUBSIDIARY means, with respect to any Person, (a) any corporation of
which an aggregate of more than 50% of the outstanding Stock having ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether, at the time, Stock of any other class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time, directly or indirectly, owned
legally or beneficially by such Person or one or more Subsidiaries of such
Person, or with respect to which any such Person has the right to vote or
designate the vote of 50% or more of such Stock whether by proxy, agreement,
operation of law or otherwise, and (b) any partnership or limited liability
company in which such Person and/or one or more Subsidiaries of such Person
shall have an interest (whether in the form of voting or participation in
profits or capital contribution) of more than 50% or of which any such Person is
a general partner or may exercise the powers of a general partner. Unless the
context otherwise requires, each reference to a Subsidiary shall be a reference
to a Subsidiary of the Holdings and shall include, in any event, ▇▇▇▇▇▇▇.
SUBSIDIARY GUARANTY means the Subsidiary Guaranty of even date herewith
executed by one or more subsidiaries of Borrower in favor of Agent, on behalf of
itself and Lenders.
SUPERMAJORITY REVOLVING LENDERS means Lenders having (a) 80% or more of
the Revolving Loan Commitments of all Lenders, or (b) if the Revolving Loan
Commitments have been terminated, 80% or more of the aggregate outstanding
amount of the Revolving Loan (with the Swing Line Loan being attributed to the
Lender making such Loan).
SWAP RELATED L/C means a letter of credit or other credit enhancement
provided by GE Capital to the extent supporting the payment obligations by
Borrower under an interest rate protection or hedging agreement or transaction
(including, but not limited to, interest rate swaps, caps, collars, floors and
similar transactions) designed to protect or manage exposure to the fluctuations
in the interest rates applicable to any of the Loans, and which agreement or
transaction Borrower entered into as the result of a specific referral pursuant
to which GE Capital, GE Corporate Financial Services, Inc. or any other
Affiliate of GE Capital had arranged for Borrower to enter into such agreement
or transaction. The term includes a Swap Related L/C as it may be increased from
time to time fully to support Borrower's payment obligations under any and all
such interest rate protection or hedging agreements or transactions.
SWAP RELATED REIMBURSEMENT OBLIGATION has the meaning ascribed to it in
SECTION 1.1(E).
SWING LINE ADVANCE has the meaning ascribed to it in SECTION 1.1(C).
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SWING LINE AVAILABILITY has the meaning ascribed to it in SECTION
1.1(C).
SWING LINE COMMITMENT means the commitment of the Swing Line Lender to
make Swing Line Advances as set forth on ANNEX B to the Agreement, which
commitment constitutes a subfacility of the Revolving Loan Commitment of the
Swing Line Lender.
SWING LINE LENDER means GE Capital.
SWING LINE LOAN means at any time, the aggregate amount of Swing Line
Advances outstanding to Borrower.
SWING LINE NOTE has the meaning ascribed to it in SECTION 1.1(C).
TARGET has the meaning ascribed to in SECTION 5.6.
TAX RETURNS means all reports, returns, information returns, claims for
refund, elections, estimated Tax filings or payments, requests for extension,
documents, statements, declarations and certifications and other information
required to be filed with respect to Taxes, including attachments thereto and
amendments thereof.
TAXES has the meaning ascribed to it in SECTION 1.9(A).
TERMINATION DATE means the date on which (a) the Loans have been
indefeasibly repaid in full, (b) all other Obligations under the Agreement and
the other Loan Documents have been completely discharged (other than contingent
indemnification obligations as to which no unsatisfied claim has been asserted),
(c) all Letter of Credit Obligations have been cash collateralized in the amount
set forth in SECTION 1.5(F), cancelled or, with the consent of Agent in each
instance, backed by standby letters of credit acceptable to Agent, (d) all
Commitments have been terminated and (e) Agent and Lenders have been released by
Credit Parties of all claims against Agent and Lenders.
TERM LENDERS means those Lenders having Term Loan B Commitments.
TERM LOAN B has the meaning ascribed to it in SECTION 1.1(A).
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TERM LOAN B COMMITMENT means (a) as to any Lender, the commitment of
such Lender to make its Pro Rata Share of the Term Loan B (as set forth on ANNEX
B) in the maximum aggregate amount set forth in SECTION 1.1(A) or in the most
recent Assignment Agreement, if any, executed by such Lender and (b) as to all
Lenders, the aggregate commitment of all Lenders to make the Term Loan B. The
Term Loan B Commitment with respect to each Term Loan B shall reduce
automatically by the amount prepaid or repaid in respect of such Term Loan B
(but solely by the amount of such prepayment or repayment allocable to a Lender,
for purposes of clause (a) of this definition).
TERM LOAN FACILITY means the Term Loan B Commitments and the provisions
herein related to the Term Loan B.
TERM NOTE B has the meaning ascribed to it in SECTION 1.1(A).
TITLE IV PLAN means a Plan (other than a Multiemployer Plan), that is
covered by Title IV of ERISA or Section 412 of the IRC, and that any Credit
Party or ERISA Affiliate maintains, contributes to or has an obligation to
contribute to on behalf of participants who are or were employed by any of them.
TRADEMARK SECURITY AGREEMENTS means the Trademark Security Agreements
made in favor of Agent, on behalf of itself and Lenders, by each applicable
Credit Party.
TRADEMARK LICENSE means rights under any written agreement now owned or
hereafter acquired by any Credit Party granting any right to such Credit Party
to use any Trademark owned by a third party.
TRADEMARKS means all of the following now owned or hereafter adopted or
acquired by any Credit Party: (a) all trademarks, trade names, corporate names,
business names, trade styles, service marks, logos, internet domain names, other
source or business identifiers, prints and labels on which any of the foregoing
have appeared or appear, designs and general intangibles of like nature (whether
registered or unregistered), all registrations and recordings thereof, and all
applications in connection therewith, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any similar
office or agency of the United States, any state or territory thereof, or any
other country or any political subdivision thereof; (b) all reissues, extensions
or renewals thereof; and (c) all goodwill associated with or symbolized by any
of the foregoing.
UNFUNDED PENSION LIABILITY means, at any time, the aggregate amount, if
any, of the amount by which the present value of all accrued benefits under each
Title IV Plan exceeds the fair market value of all assets of such Title IV Plan
allocable to such benefits in accordance with Title IV of ERISA, all determined
as of the most recent valuation date for each such Title IV Plan using the
actuarial assumptions for purposes of determining the funded status of such
Title IV Plan under Section 412 of the IRC.
WELFARE PLAN means a Plan described in Section 3(l) of ERISA.
Rules of construction with respect to accounting terms used in the
Agreement or the other Loan Documents shall be as set forth or referred to in
this ANNEX A. All other undefined terms contained in any of the Loan Documents
shall, unless the context indicates otherwise, have the meanings provided for by
the Code to the extent the same are used or defined therein; in the event that
any term is defined differently in different Articles or Divisions of the Code,
the definition contained in Article or Division 9 shall control. Unless
otherwise specified, references in the Agreement or any of the Appendices to a
Section, subsection or clause refer to such Section, subsection or clause as
contained in the Agreement. The words "herein," "hereof" and "hereunder" and
other words of similar import refer to the Agreement as a whole, including all
Annexes, Exhibits and Schedules, as the same may from time to time be amended,
restated, modified or supplemented, and not to any particular section,
subsection or clause contained in the Agreement or any such Annex, Exhibit or
Schedule.
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Wherever from the context it appears appropriate, each term stated in
either the singular or plural shall include the singular and the plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, feminine and neuter genders. The words "including", "includes" and
"include" shall be deemed to be followed by the words "without limitation"; the
word "or" is not exclusive; references to Persons include their respective
successors and assigns (to the extent and only to the extent permitted by the
Loan Documents) or, in the case of governmental Persons, Persons succeeding to
the relevant functions of such Persons; and all references to statutes and
related regulations shall include any amendments of the same and any successor
statutes and regulations. Whenever any provision in any Loan Document refers to
the knowledge (or an analogous phrase) of any Credit Party, such words are
intended to signify that such Credit Party has actual knowledge or awareness of
a particular fact or circumstance or that such Credit Party, if it had exercised
reasonable diligence, would have known or been aware of such fact or
circumstance. Definitions of agreements and instruments in ANNEX A shall mean
and refer to such agreements and instruments as amended, modified, supplemented,
restated, substituted or replaced from time to time in accordance with their
respective terms and the terms of this Agreement and the other Loan Documents.
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