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EXECUTION COPY
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CREDIT AGREEMENT
by and among,
HEALTHSOUTH CORPORATION,
as Borrower,
UBS AG, STAMFORD BRANCH,
as Administrative Agent
DEUTSCHE BANK AG NEW YORK BRANCH
as Syndication Agent
THE LENDERS PARTY HERETO FROM TIME TO TIME
UBS WARBURG LLC
and
DEUTSCHE BANK SECURITIES INC.
as Joint Lead Arrangers
and
THE INDUSTRIAL BANK OF JAPAN, LIMITED,
as Documentation Agent
October 31, 2000
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ARTICLE I Definitions and Terms...................................................................................1
1.1. Definitions...........................................................................................1
1.2. Rules of Interpretation..............................................................................25
1.3. Classes and Types of Loans...........................................................................26
ARTICLE II The Loans.............................................................................................27
2.1. Revolving Credit Loans...............................................................................27
2.2. Facility Extension Loans.............................................................................29
2.3. Payment of Interest..................................................................................30
2.4. Payment of Principal.................................................................................30
2.5. Non-Conforming Payments..............................................................................31
2.6. Notes................................................................................................31
2.7. Pro Rata Payments....................................................................................31
2.8. Reductions...........................................................................................32
2.9. Conversions and Elections of Subsequent Interest Periods.............................................32
2.10. Unused Fees.......................................................................................33
2.11. Deficiency Advances...............................................................................33
2.12. Use of Proceeds...................................................................................33
2.13. Increase and Decrease in Amounts..................................................................33
ARTICLE III Letters of Credit....................................................................................34
3.1. Letters of Credit....................................................................................34
3.2. Reimbursement........................................................................................34
3.3. Letter of Credit Facility Fees.......................................................................37
3.4. Administrative Fees..................................................................................38
3.5. Applications.........................................................................................38
ARTICLE IV Change in Circumstances...............................................................................38
4.1. Increased Cost and Reduced Return....................................................................38
4.2. Limitation on Types of Loans.........................................................................39
4.3. Illegality...........................................................................................40
4.4. Treatment of Affected Loans..........................................................................40
4.5. Compensation.........................................................................................41
4.6. Taxes................................................................................................41
ARTICLE V Conditions to Making Loans and Issuing Letters of Credit...............................................43
5.1. Conditions of Initial Advance........................................................................43
5.2. Conditions of Loans and Letters of Credit............................................................45
ARTICLE VI Representations and Warranties........................................................................46
6.1. Organization and Authority...........................................................................46
6.2. Loan Documents.......................................................................................47
6.3. Solvency.............................................................................................47
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6.4. Subsidiaries and Subsidiaries' Guarantees............................................................47
6.5. Ownership Interests..................................................................................47
6.6. Financial Condition..................................................................................47
6.7. Title to Properties..................................................................................48
6.8. Taxes................................................................................................48
6.9. Other Agreements.....................................................................................48
6.10. Litigation........................................................................................49
6.11. Margin Stock......................................................................................49
6.12. Investment Company................................................................................50
6.13. Patents, Etc......................................................................................50
6.14. No Untrue Statement...............................................................................50
6.15. No Consents, Etc..................................................................................50
6.16. ERISA Requirement.................................................................................50
6.17. No Default........................................................................................51
6.18. Hazardous Materials...............................................................................51
6.19. Employment Matters................................................................................51
6.20. RICO..............................................................................................51
6.21. Reimbursement from Third Party Payors.............................................................51
6.22. Material Adverse Change...........................................................................52
ARTICLE VII Affirmative Covenants................................................................................52
7.1. Financial Statements, Reports, Etc...................................................................52
7.2. Maintain Properties..................................................................................53
7.3. Conduct of Business and Maintenance of Existence, Qualification, Etc.................................54
7.4. Regulations and Taxes................................................................................54
7.5. Insurance............................................................................................54
7.6. True Books...........................................................................................54
7.7. Right of Inspection..................................................................................54
7.8. Observe all Laws.....................................................................................54
7.9. Governmental Licenses................................................................................55
7.10. Covenants Extending to Other Persons..............................................................55
7.11. Officer's Knowledge of Default....................................................................55
7.12. Suits or Other Proceedings........................................................................55
7.13. Notice of Discharge of Hazardous Material or Environmental Complaint..............................55
7.14. Environmental Compliance..........................................................................56
7.15. Continuation of Current Business..................................................................56
7.16. Management Contracts..............................................................................56
7.17. Payment of Obligations............................................................................56
7.18. New Subsidiaries..................................................................................56
ARTICLE VIII Negative Covenants..................................................................................56
8.1. Financial Covenants..................................................................................57
8.2. Investments and Loans................................................................................57
8.3. Indebtedness.........................................................................................57
8.4. Disposition of Assets................................................................................57
8.5. Consolidation or Merger..............................................................................58
8.6. Liens................................................................................................58
ii
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8.7. Dividends and Distributions..........................................................................58
8.8. Acquisitions and Capital Expenditures................................................................58
8.9. Restricted Payments; Other Payments..................................................................59
8.10. Compliance with ERISA.............................................................................59
8.11. Fiscal Year.......................................................................................60
8.12. Dissolution, etc..................................................................................60
8.13. Transactions with Affiliates......................................................................60
ARTICLE IX Events of Default and Acceleration....................................................................60
9.1. Events of Default....................................................................................60
9.2. Administrative Agent to Act..........................................................................63
9.3. Cumulative Rights....................................................................................63
9.4. No Waiver............................................................................................63
9.5. Allocation of Proceeds...............................................................................64
ARTICLE X The Administrative Agent...............................................................................64
10.1. Appointment, Powers, and Immunities...............................................................64
10.2. Reliance by Administrative Agent..................................................................65
10.3. Defaults..........................................................................................65
10.4. Rights as Lender..................................................................................65
10.5. Indemnification...................................................................................66
10.6. Non-Reliance on Administrative Agent and Other Lenders............................................66
10.7. Resignation of Administrative Agent...............................................................66
10.8. Fees..............................................................................................67
ARTICLE XI Miscellaneous.........................................................................................67
11.1. Assignments and Participations....................................................................67
11.2. Notices...........................................................................................69
11.3. No Waiver.........................................................................................70
11.4. Rights of Setoff; Adjustments.....................................................................70
11.5. Survival..........................................................................................71
11.6. Expenses..........................................................................................71
11.7. Amendments and Waivers............................................................................72
11.8. Counterparts......................................................................................72
11.9. Waivers by Borrower...............................................................................72
11.10. Termination.......................................................................................72
11.11. Governing Law.....................................................................................73
11.12. Indemnification...................................................................................73
11.13. Agreement Controls................................................................................74
11.14. Integration.......................................................................................74
11.15. Successors and Assigns............................................................................74
11.16. Severability......................................................................................75
11.17. Lender Addenda....................................................................................75
11.18. Designated Senior Indebtedness....................................................................75
EXHIBIT A Lender Addendum
EXHIBIT B Form of Assignment and Acceptance
EXHIBIT C Notice of Appointment (or Revocation) of Authorized Representative
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EXHIBIT D Form of Borrowing Notice
EXHIBIT E Form of Interest Rate Selection Notice
EXHIBIT F Form of Note
EXHIBIT G Investments
EXHIBIT H Form of Opinion of Borrower's Counsel
EXHIBIT I Compliance Certificate
EXHIBIT J Executive Officers
EXHIBIT K Form of Guarantee
Schedule 1.1(a) Preferred Cash Distribution Arrangement
Schedule 6.4 Subsidiaries
Schedule 6.19 Employment Matters
Schedule 8.3 Existing Subsidiary Indebtedness
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT dated as of October 31, 2000 (this
"Agreement") is entered into by and among HEALTHSOUTH CORPORATION, a Delaware
corporation (the "Borrower"), the Lenders signatories hereto (the "Lenders") and
UBS AG, STAMFORD BRANCH, as administrative agent (in such capacity, the
"Administrative Agent").
RECITAL:
The Borrower has requested that the Lenders make available to
the Borrower a revolving credit facility of up to $400,000,000, including a
$20,000,000 sublimit for the issuance of standby letters of credit, the proceeds
of which shall be used as set forth in Section 2.12, and the Lenders have agreed
to make such revolving credit facility available to the Borrower on the
following terms and conditions:
ARTICLE I
Definitions and Terms
1.1. Definitions. (a) For the purposes of this agreement, in
addition to the definitions set forth above, the following terms shall have the
respective meanings set forth below:
"Acquisition" means the acquisition, whether with cash,
property, stock or promise to pay, of all or a portion of a Person or a
Facility or Facilities of a Person, permitted under Section 8.8;
provided such Person, Facility or Facilities is in substantially the
same line of business engaged in by Borrower or its Consolidated
Entities.
"Acquisition/CapEx Basket Amount" means, for any Fiscal Year,
the sum of (a) the Acquisition/CapEx Initial Basket Amount plus (b) 50%
of the amount, if any, of the Acquisition/CapEx Basket Amount
applicable to the immediately preceding Fiscal Year pursuant to the
foregoing clause (a) that was not expended during such immediately
preceding Fiscal Year for Acquisitions pursuant to Section 8.8(a)(ii)
or for Capital Expenditures pursuant to Section 8.8(b). For the
purposes hereof, any amount spent in any Fiscal Year in respect of
Acquisitions pursuant to Section 8.8(a)(ii) or Capital Expenditures
pursuant to Section 8.8(b) shall be applied, first, toward amounts
permitted to be spent during such Fiscal Year pursuant to the foregoing
clause (a) of this definition and, second, to amounts permitted to be
spent during such Fiscal Year pursuant to the foregoing clause (b) of
this definition.
"Acquisition/CapEx Initial Basket Amount" means an amount
equal to $650,000,000.
"Actual/360 Basis" means a method of computing interest or
other charges hereunder on the basis of an assumed year of 360 days for
actual number of days elapsed,
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meaning that interest or other charges accrued for each day will be
computed by multiplying the rate per annum applicable on that day by
the unpaid principal balance (or other relevant sum) on that day and
dividing the result by 360.
"Advance" means a borrowing under the Revolving Credit
Facility consisting of the aggregate principal amount of a Revolving
Credit Loan.
"Affiliate" of any specified Person means any other Person (i)
which directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, such
specified Person; or (ii) which beneficially owns or holds 5% or more
of any class of the outstanding Voting Stock (or in the case of a
Person which is not a corporation, 5% or more of the equity interest)
of such specified Person; or 5% or more of any class of the outstanding
Voting Stock (or in the case of a Person which is not a corporation, 5%
or more of the equity interest) of which is beneficially owned or held
by such specified Person. The term "control" means the possession,
directly or indirectly, of the power to direct or cause the direction
of the management and policies of a Person, whether through ownership
of Voting Stock, by contract or otherwise.
"Applicable Commitment Percentage" means, with respect to each
Lender, that portion of the Total Revolving Credit Commitment allocable
to such Lender (a) with respect to Lenders as of the Closing Date, as
set forth on Schedule 1 to the Lender Addendum executed and delivered
by such Lender, and (b) with respect to any Person who becomes a Lender
thereafter, as reflected in each Assignment and Acceptance to which
such Lender is a party assignee; provided that the Applicable
Commitment Percentage of each Lender shall be increased or decreased to
reflect any assignments to or by such Lender effected in accordance
with Section 11. 1.
"Applicable Extension Percentage" means, with respect to each
Lender, that portion of the aggregate amount of Facility Extension
Loans outstanding and allocable to such Lender as in effect from time
to time giving effect to each Assignment and Acceptance to which such
Lender is a party.
"Applicable Lending Office" means, for each Lender and for
each Type of Loan, the "Lending Office" of such Lender (or an affiliate
of such Lender) designated for such Type of Loan on the signature pages
hereof or such other office of such Lender (or an affiliate of such
Lender) as such Lender may from time to time specify to the
Administrative Agent and the Borrower by written notice in accordance
with the terms hereof as the office by which its Loans of such Type are
to be made and maintained.
"Applicable Margin" means that percent per annum set forth in
the table below under the heading "Applicable Margin for Eurodollar
Rate Loans" or "Applicable Margin for Base Rate Loans", as applicable,
opposite the applicable Tier determined by the highest Rating as in
effect at the time of determination (subject to the provisions of this
definition following the table below):
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RATING APPLICABLE MARGIN FOR APPLICABLE MARGIN
TIER S&P OR MOODYS EURODOLLAR RATE LOANS FOR BASE RATE LOANS
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<S> <C> <C> <C>
I BBB+ Baa1 1.250% 0.250%
or higher or higher
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II BBB Baa2 1.500% 0.500%
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III BBB- Baa3 1.750% 0.750%
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IV BB+ Ba1 2.000% 1.000%
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V Less than Less than 2.250% 1.250%
BB+ Ba1
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The Applicable Margin shall be established from time to time
based upon the Rating then in effect. Any change in the Applicable
Margin due to a change in any Rating shall be effective on the date of
such change in such Rating. In the event (i) of a split Rating where
the Ratings are more than one Tier apart, then the Tier next above the
Tier corresponding to the lower Rating shall apply and, (ii) either
Rating is Tier IV or below (or unrated), then (A) the Applicable Margin
shall be Tier IV if either Rating is Tier IV or higher and (B) Tier V
otherwise. In the event that the Borrower shall not have a Rating by
either S&P or Moody's, the Applicable Margin shall be mutually agreed
to by the Borrower, the Administrative Agent and the Lenders and shall
be Tier V until such mutual agreement is reached.
"Applicable Unused Fee" means that percent per annum set forth
in the table below under the heading "Applicable Unused Fee" opposite
the applicable Tier determined by the highest Rating as in effect at
the time of determination (subject to the provisions of this definition
following the table below):
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RATING APPLICABLE UNUSED
TIER S&P OR MOODY'S FEE
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<S> <C> <C> <C>
I BBB+ Baa1 0.250%
or higher or higher
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II BBB Baa2 0.375%
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III BBB- Baa3 0.375%
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IV BB+ Ba1 0.500%
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V Less than Less than 0.500%
BB+ Ba1
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The Applicable Unused Fee shall be established from time to
time based upon the Ratings then in effect. Any change in the
Applicable Unused Fee due to a change in any Rating shall be effective
on the date of such change in such Rating. In the event (i) of split
Ratings where the Ratings are more than one Tier apart, then the Tier
next above the Tier corresponding to the lower Rating shall apply and,
(ii) either Rating is Tier IV or below (or unrated), then (A) the
Applicable Unused Fee shall be Tier IV if either Rating is Tier IV or
higher and (B) Tier V otherwise. In the event that the Borrower shall
not have a Rating by either S&P or Moody's, the Applicable Unused Fee
shall be mutually agreed to by the Borrower, the Administrative Agent
and the Lenders and shall be Tier IV until such mutual agreement is
reached.
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"Applications and Agreements for Letters of Credit" means,
collectively, the Applications and Agreements for Letters of Credit, or
similar documentation, executed by the Borrower from time to time and
delivered to the Issuing Bank to support the issuance of Letters of
Credit and which terms shall state that the requested Letter of Credit
is to be issued under this Agreement.
"Assignment and Acceptance" means an Assignment and Acceptance
in the form of Exhibit B (with blanks appropriately filled in) (or in
such other form as shall be approved by the Administrative Agent)
delivered to the Administrative Agent in connection with an assignment
of a Lender's interest under this Agreement pursuant to Section 11. 1.
"Authorized Representative" means any of the Executive
Officers of the Borrower or, with respect to financial matters, the
Treasurer or the Chief Financial Officer of the Borrower, or any other
Person expressly designated by the board of directors of the Borrower
(or the appropriate committee thereof) as an Authorized Representative
of the Borrower, as set forth from time to time in a certificate in the
form of Exhibit C.
"Base Rate" means, for any day, the rate per annum equal to
the higher of (i) the Prime Rate for such day or (ii) the Federal Funds
Rate for such day plus one-half of one percent (1/2%). Any change in
the Base Rate due to a change in the Prime Rate or the Federal Funds
Rate shall be effective on the effective date of such change in the
Prime Rate or Federal Funds Rate.
"Base Rate Loan" means a Loan for which the rate of interest
is determined by reference to the Base Rate.
"Base Rate Refunding Loan" means an Advance under the
Revolving Credit Facility which bears interest at a Base Rate made to
satisfy Reimbursement Obligations arising from a drawing under a Letter
of Credit.
"Board" means the Board of Governors of the Federal Reserve
System (or any successor body).
"Borrowing Notice" means the notice delivered by an Authorized
Representative in connection with an Advance under the Revolving Credit
Facility, in the form of Exhibit D.
"Business Day" means, (i) except in the case of a Eurodollar
Rate Loan, any day which is not a Saturday, Sunday or a day on which
banks in the State of New York are authorized or obligated by law,
executive order or governmental decree to be closed and, (ii) with
respect to any Eurodollar Rate Loan, any day which is a Business Day,
as described above, and on which the relevant international financial
markets are open for the transaction of business contemplated by this
Agreement in London, England, and New York, New York.
4
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"Capital Expenditures" means, for any period, with respect to
any Person, the aggregate of all expenditures by such Person and its
Subsidiaries for the acquisition or leasing (pursuant to a Capital
Lease) of fixed or capital assets or additions to equipment (including
replacements, capitalized repairs and improvements during such period)
which should be capitalized under GAAP on a consolidated balance sheet
of such Person and its Subsidiaries, but for the avoidance of
duplication, excluding any amounts included in Cost of Acquisition with
respect to any Acquisition.
"Capital Leases" means all leases which have been or should be
capitalized in accordance with GAAP as in effect from time to time
including Statement No. 13 of the Financial Accounting Standards Board
or any successor thereof.
"Capital Stock" of any Person means any and all shares, rights
to purchase, warrants or options (whether or not currently
exercisable), participation or other equivalents of or interest in
(however designated) the equity (including without limitation common
stock, preferred stock and partnership and joint venture interests) of
such Person (excluding any debt securities that are convertible into,
or exchangeable for, such equity).
"Change of Control" means, at any time:
(i) all or substantially all of the Borrower's assets are sold
as an entirety to any Person or related group of Persons;
(ii) there shall be consummated any consolidation or merger of
the Borrower (A) in which the Borrower is not the continuing or
surviving corporation (other than a consolidation or merger with a
wholly owned Subsidiary of the Borrower in which all shares of the
Borrower's Common Stock outstanding immediately prior to the
effectiveness thereof are changed into or exchanged for the same
consideration) or (B) pursuant to which the Borrower's Common Stock
would be converted into cash, securities or other property, in each
case other than a consolidation or merger of the Borrower in which the
holders of the Borrower's Common Stock immediately prior to the
consolidation or merger have, directly or indirectly, at least a
majority of the total Voting Stock of the continuing or surviving
corporation immediately after such consolidation or merger in
substantially the same proportion as their ownership of the Borrower's
Common Stock immediately before such transaction;
(iii) any "person" or "group" (each as used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act), who are not as of the
Closing Date owners of one percent (1%) or more of the Voting Stock of
the Borrower, either (A) becomes the "beneficial owner" (as defined in
Rule 13d-3 of the Exchange Act), directly or indirectly, of Voting
Stock of the Borrower (or securities convertible into or exchangeable
for such Voting Stock) representing 15% or more of the combined voting
power of all Voting Stock of the Borrower (on a fully diluted basis) or
(B) otherwise has the ability, directly or indirectly, to elect a
majority of the board of directors of the Borrower;
(iv) during any period of up to 24 consecutive months,
commencing on the Closing Date, individuals who at the beginning of
such period were directors of the
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Borrower shall cease for any reason (other than the death, disability
or retirement of an officer of the Borrower that is serving as a
director at such time so long as another officer of the Borrower
replaces such Person as a director) to constitute a majority of the
board of directors of the Borrower;
(v) any Person or two or more Persons acting in concert shall
have acquired by contract or otherwise, or shall have entered into a
contract or arrangement that, upon consummation thereof, will result in
its or their acquisition, of the power to exercise, directly or
indirectly, a controlling influence on the management or policies of
the Borrower, or
(vi) the Borrower is liquidated or dissolved or adopts a plan
of liquidation or dissolution.
"Closing Date" means the date as of which this Agreement is
executed by the Borrower, the Lenders and the Administrative Agent and
on which the conditions set forth in Section 5.1 have been satisfied.
"Code" means the Internal Revenue Code of 1986, as amended,
and any regulations promulgated thereunder.
"Common Stock" means the common stock, par value $.01 per
share, of the Borrower.
"Consistent Basis" in reference to the application of GAAP
means the accounting principles observed in the period referred to are
comparable in all material respects to those applied in the preparation
of the audited financial statements of the Borrower referred to in
Section 6.6(a).
"Consolidated Amortization Expense" of the Borrower for any
period means the amortization expense of the Borrower and its
Consolidated Entities for such period (to the extent included in the
computation of Consolidated Net Income), determined on a consolidated
basis in accordance with GAAP.
"Consolidated Depreciation Expense" of the Borrower means the
depreciation expense of the Borrower and its Consolidated Entities for
such period (to the extent included in the computation of Consolidated
Net Income of the Borrower), determined on a consolidated basis in
accordance with GAAP.
"Consolidated EBITDA" means, with respect to the Borrower and
its Consolidated Entities for any Four-Quarter Period ending on the
date of computation thereof, the sum of, without duplication, (i)
Consolidated Net Income, (ii) Consolidated Interest Expense, (iii)
Consolidated Income Tax Expense, (iv) Consolidated Amortization
Expense, (v) Consolidated Depreciation Expense, (vi) the minority
interest of any Person or Persons in the income of Consolidated
Entities for such period, (vii) the non-recurring, non-cash expenses
and cash transaction costs relating to professional fees arising in
conjunction with an Acquisition provided such expenses do not exceed
10% of the Cost of Acquisition and (viii) as applicable, the
non-recurring, non-cash expenses incurred by
6
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the Borrower and its Consolidated Entities during the three month
period ended September 30, 1999 and the three month period ended
December 31, 1999; all determined on a consolidated basis in accordance
with GAAP applied on a Consistent Basis.
"Consolidated Entity" means any Person whose financial
statements are appropriately consolidated with the Borrower's financial
statements under GAAP.
"Consolidated Indebtedness" means all Indebtedness of the
Borrower and its Consolidated Entities, all determined on a
consolidated basis.
"Consolidated Interest Expense" means, with respect to any
Four-Quarter Period ending on the date of computation thereof, the
gross interest expense of the Borrower and its Consolidated Entities,
including without limitation (i) the current amortized portion of debt
discounts to the extent included in gross interest expense, (ii) the
current amortized portion of all fees (including fees payable in
respect of any Rate Hedging Obligation) payable in connection with the
incurrence of Indebtedness to the extent included in gross interest
expense, (iii) the portion of any payments made in connection with
Capital Leases allocable to interest expense, and (iv) lease payments,
other than the Headquarters Obligations and Hospitals Obligations, made
pursuant to the Headquarters Lease and Hospitals Lease, respectively,
all determined on a consolidated basis in accordance with GAAP applied
on a Consistent Basis.
"Consolidated Net Income" of the Borrower for any period means
the net income (or loss) of the Borrower and its Consolidated Entities
for such period determined on a consolidated basis in accordance with
GAAP, without giving effect to dividends on any series of preferred
stock of any Consolidated Entity, whether or not in cash, to the extent
such consolidated net income was reduced thereby; provided that there
shall be excluded from such net income (for all purposes, other than
compliance with Section 8.1(a), to the extent otherwise included
therein), without duplication, (i) the net income of any Person (other
than a Consolidated Entity) to the extent that any such income has not
actually been received by the Borrower or a Consolidated Entity in the
form of dividends or similar distributions during such period, but
including, in any event, net income of any Person who becomes a
Consolidated Entity whose Acquisition is accounted for on a "pooling of
interests" basis; (ii) except to the extent includable in the
consolidated net income of the Borrower or a Consolidated Entity
pursuant to the foregoing clause (i), the net income of any Person that
accrued prior to the date that (a) such Person becomes a Consolidated
Entity or is merged into or consolidated with a Consolidated Entity or
(b) the assets of such Person are acquired by the Borrower or a
Consolidated Entity; (iii)the net income of any Consolidated Entity to
the extent that the declaration or payment of dividends or similar
distributions by such Consolidated Entity of that income is not
permitted by operation of the terms of its charter or any agreement,
instrument, judgment, decree, order, statute, rule or governmental
regulation applicable to that Consolidated Entity during such period;
(iv) any gain (or loss), together with any related provisions for taxes
on any such gain, realized during such period by the Borrower or its
Consolidated Entities upon (a) the acquisition of any securities, or
the extinguishment of any Indebtedness, of the Borrower or its
Consolidated Entities or (b) any asset sale by the
7
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referent Person or any of its Subsidiaries; (v) any extraordinary gain
(or extraordinary loss), together with any related provision for taxes
or tax benefit resulting from any such extraordinary gain or loss,
realized by the Borrower or its Consolidated Entities during such
period; and (vi) in the case of a successor to any Person by
consolidation, merger or transfer of its assets, any earnings of the
successor prior to such merger, consolidation or transfer of assets.
"Consolidated Net Worth" of the Borrower as of any date means
the Consolidated Stockholders' Equity (including any preferred stock
that is classified as equity under GAAP, other than Disqualified Stock)
of the Borrower and its Consolidated Entities (excluding any equity
adjustment for foreign currency translation for any period subsequent
to the Closing Date) on a consolidated basis at such date, as
determined in accordance with GAAP, less all write-ups subsequent to
the Closing Date in the book value of any asset owned by the Borrower
or any of its Consolidated Entities.
"Consolidated Stockholders' Equity" means at any time as at
which the amount thereof is to be determined, the sum of the following
amounts in respect of the Borrower and the Consolidated Entities: (i)
the par or stated value of all Capital Stock of the Borrower, (ii)
retained earnings, (iii) additional paid in capital, (iv) capital
surplus and (v) earned surplus minus treasury stock.
"Consolidated Tangible Net Assets" means, as of any date on
which the amount thereof is determined, Consolidated Total Assets minus
(without duplication of deductions in respect of items already deducted
in arriving at surplus and retained earnings) (i) all reserves (other
than contingency reserves not allocated to any particular purpose),
including without limitation reserves for depreciation, depletion,
amortization, obsolescence, deferred income taxes, insurance and
inventory valuation, and (ii) the net book value of all assets which
would be treated as intangible assets, such as (without limitation)
goodwill (whether representing the excess of cost over book value of
assets acquired or otherwise), capitalized expenses, unamortized debt
discount and expense, consignment inventory rights, patents,
trademarks, trade names, copyrights, franchises and licenses, all as
determined on a consolidated basis in accordance with GAAP applied on a
Consistent Basis.
"Consolidated Tangible Net Worth" means, as of any date on
which the amount thereof is to be determined, Consolidated
Stockholders' Equity minus (without duplication of deductions in
respect of items already deducted in arriving at surplus and retained
earnings) (i) all reserves (other than contingency reserves not
allocated to any particular purpose), including without limitation
reserves for depreciation, depletion, amortization, obsolescence,
deferred income taxes, insurance and inventory valuation, and (ii) the
net book value of all assets which would be treated as intangible
assets, such as (without limitation) goodwill (whether representing the
excess of cost over book value of assets acquired or otherwise),
capitalized expenses, unamortized debt discount and expense,
consignment inventory rights, patents, trademarks, trade names,
copyrights, franchises and licenses, all as determined on a
consolidated basis in accordance with GAAP applied on a Consistent
Basis.
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"Consolidated Total Assets" means, as of any date on which the
amount thereof is to be determined, the net book value of all assets of
the Borrower and its Consolidated Entities as determined on a
consolidated basis in accordance with GAAP applied on a Consistent
Basis.
"Consolidated Total Capital" means, as of any date on which
the amount thereof is to be determined, the sum of Consolidated
Indebtedness plus Consolidated Stockholders' Equity of the Borrower and
its Consolidated Entities.
"Continue", "Continuation", and "Continued" shall refer to the
continuation pursuant to Section 2.9 hereof of a Eurodollar Rate Loan
as a Eurodollar Rate Loan from one Interest Period to the next Interest
Period.
"Contract Provider" means any Person who provides professional
health care services under or pursuant to any contract with the
Borrower or any Subsidiary.
"Controlled Investment Affiliate" of any specified Person,
means any other Person that (i) directly or indirectly through one or
more intermediaries is in control of, is controlled by, or is under
common control with, such specified Person and (ii) is organized by
such specified Person primarily for the purpose of making equity or
debt investments in one or more companies. For purposes of this
definition, "control" of a Person means the power, directly or
indirectly, to direct or cause the direction of the management and
policies of such Person, whether through ownership of Voting Stock, by
contract or otherwise.
"Controlled Partnership" means a general partnership of which
the Borrower or a Subsidiary is a general partner, or a limited
partnership whose general partners include the Borrower or a Subsidiary
(but not including Vanderbilt), or a limited liability company whose
members include the Borrower or a Subsidiary or another Controlled
Partnership, which partnership, whether general or limited, or limited
liability company has assets with a value in excess of $2,000.00, and
with respect to which partnership or limited liability company the
Borrower or a Subsidiary is entitled to receive not less than 50% of
any distributions of cash made to the partners or members thereof,
other than any preferred cash distribution arrangement in existence at
the Closing Date as set forth on Schedule 1.1(a) hereto, or approved by
the Required Lenders in writing, or which is otherwise a Consolidated
Entity.
"Convert", "Conversion" and "Converted" refers to a conversion
pursuant to Section 2.9 or Article IV of one Type of Loan into another
Type of Loan.
"Convertible Subordinated Debentures" means the 3.25%
Convertible Subordinated Debentures due 2003 issued by the Borrower, as
the same may be amended, supplemented, waived or otherwise modified
from time to time.
"Cost of Acquisition" means in respect of any Acquisition, the
sum of (i) the amount of cash paid by the Borrower and its Consolidated
Entities in connection with such Acquisition, (ii) the Fair Market
Value of all Capital Stock or other ownership
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<PAGE>
interests of the Borrower or any Consolidated Entity issued or given in
connection with such Acquisition, (iii) the amount (determined by using
the face amount or the amount payable at maturity, whichever is
greater) of all Indebtedness incurred, assumed or acquired in
connection with such Acquisition, (iv) all additional purchase price
amounts in the form of earnouts and other contingent obligations that
should be recorded on the financial statements of the Borrower and its
Consolidated Entities in connection with Generally Accepted Accounting
Principles, (v) all amounts paid in respect of covenants not to
compete, consulting agreements and other affiliated contracts in
connection with such Acquisition and (vi) the aggregate fair market
value of all other consideration given by the Borrower and its
Consolidated Entities in connection with such Acquisition.
"Default" means any event or condition which, with the giving
or receipt of notice or lapse of time or both, would constitute an
Event of Default.
"Default Rate" means (i) with respect to each Eurodollar Rate
Loan, until the end of the Interest Period applicable thereto, a rate
of two percent (2%) above the Eurodollar Rate applicable to such Loan
plus the Applicable Margin applicable to Eurodollar Loans, and
thereafter at a rate of interest per annum which shall be two percent
(2%) above the Base Rate plus the Applicable Margin applicable to Base
Rate Loans, (ii) with respect to Base Rate Loans, at a rate of interest
per annum which shall be two percent (2%) above the Base Rate plus the
Applicable Margin applicable to Base Rate Loans and (iii) in any case,
the maximum rate permitted by applicable law, if lower.
"Disqualified Stock" means any Capital Stock that, by its
terms (or by the terms of any security into which it is convertible or
for which it is exchangeable), or upon the happening of any event,
matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder
thereof, in whole or in part, on or prior to the Revolving Credit
Termination Date or the Facility Extension Loan Termination Date, if
applicable.
"Dollars" and the symbol "$" mean dollars constituting legal
tender for the payment of public and private debts in the United States
of America.
"Eligible Assignee" means (i) a Lender, (ii) an affiliate of a
Lender, (iii) any Controlled Investment Affiliate of a Lender, and (iv)
any other Person approved by the Administrative Agent and, unless an
Event of Default has occurred and is continuing at the time any
assignment is effected in accordance with Section 11.1, the Borrower,
such approval not to be unreasonably withheld or delayed by the
Borrower or the Administrative Agent and such approval to be deemed
given by the Borrower if no objection is received by the assigning
Lender and the Administrative Agent from the Borrower within two
Business Days after written notice of such proposed assignment has been
provided by the assigning Lender to the Borrower; provided, however,
that neither the Borrower nor an affiliate of the Borrower shall
qualify as an Eligible Assignee.
"Employee Benefit Plan" means any employee benefit plan within
the meaning of Section 3(3) of ERISA which (i) is maintained for
employees of the Borrower or any of its ERISA Affiliates or is assumed
by the Borrower or any of its ERISA Affiliates in
10
<PAGE>
connection with any Acquisition or (ii) has at any time been maintained
for the employees of the Borrower or any current or former ERISA
Affiliate.
"Environmental Laws" means any federal, state or local
statute, law, ordinance, code, rule, regulation, order, decree, permit
or license regulating, relating to, or imposing liability or standards
of conduct concerning any environmental matters or conditions,
environmental protection or conservation, including without limitation,
the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended; the Superfund Amendments and Reauthorization
Act of 1986, the Resource Conservation and Recovery Act, as amended;
the Toxic Substances Control Act, as amended; the Clean Air Act, as
amended; the Clean Water Act, as amended; together with all regulations
promulgated thereunder, and any other "Superfund" or "Superlien" law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor statute and all
rules and regulations promulgated thereunder.
"ERISA Affiliate", as applied to the Borrower, means any
Person or trade or business which is a member of a group which is under
common control with the Borrower, who together with the Borrower, is
treated as a single employer within the meaning of Section 414(b) and
(c) of the Code.
"Eurodollar Rate" means the interest rate per annum calculated
according to the following formula:
Eurodollar Rate = Interbank Offered Rate
----------------------
(1- Reserve Requirement)
"Eurodollar Rate Loan" means a Loan for which the rate of
interest is determined by reference to the Eurodollar Rate.
"Event of Default" means any of the occurrences set forth as
such in Section 9. 1.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder.
"Executive Officer" means any Person who from time to time
holds the offices with Borrower listed on Exhibit J.
"Facility" means an inpatient or outpatient rehabilitation
facility, certified outpatient rehabilitation facility, skilled nursing
facility, specialty medical center, specialty orthopedic hospital or
acute care hospital, subacute inpatient facility, transitional living
center, medical office building, outpatient surgery center or
outpatient diagnostic center with all buildings and improvements
associated therewith, that is owned or leased or acquired (as permitted
under Section 8.8), in whole or part, by the Borrower or a Subsidiary
or any Controlled Partnership.
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"Facility Extension Loan Termination Date" means the Facility
Extension Maturity Date or such earlier date of termination of Lenders'
obligations hereunder as may be determined pursuant to Section 9.1 upon
the occurrence of an Event of Default, or such date on which the
Borrower may voluntarily and permanently terminate the Revolving Credit
Facility by payment in full of all outstanding amounts under the
Facility Extension Loans with all accrued and unpaid interest and fees
thereon.
"Fair Market Value" means, with respect to any capital stock
or other ownership interests issued or given by the Borrower or any
Consolidated Entity in connection with an Acquisition, (i) in the case
of capital stock that is Common Stock and such Common Stock is then
designated as a national market system security by the National
Association of Securities Dealers, Inc. ("NASD") or is listed on a
national securities exchange, the average of the last reported bid and
ask quotations or prices reported thereon for Common Stock or such
other value as may be ascribed to the Common Stock in a definitive
merger or acquisition agreement provided such value is determined
according to customary methods for like transactions and is approved
(to the extent required by Borrower's charter or bylaws) by the
Borrower's board of directors or (ii) in the case of capital stock that
is not Common Stock or in the event that Common Stock is not so
designated by NASD or listed on such national exchange, or in the case
of any other ownership interests, the determination of the fair market
value thereof in good faith by a majority of disinterested members of
the board of directors of the Borrower or such Consolidated Entity, in
each case effective as of the close of business on the Business Day
immediately preceding the closing date of such Acquisition.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upwards, if necessary, to the nearest 1/100th of 1%) equal to
the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by
Federal funds brokers on such day, as published by the Federal Reserve
Bank of New York on the Business Day next succeeding such day, provided
that (a) if such day is not a Business Day, the Federal Funds Rate for
such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and
(b) if no such rate is so published on such next succeeding Business
Day, the Federal Funds Rate for such day shall be the average rate
charged to the Administrative Agent (in its individual capacity) on
such day on such transaction as shall be determined by the
Administrative Agent.
"Fiscal Year" means, with respect to the Borrower, the twelve
month fiscal period of the Borrower commencing on January 1 of each
calendar year and ending on December 31 of each calendar year.
"Four-Quarter Period" means a period of four full consecutive
fiscal quarters of the Borrower and its Subsidiaries, taken together as
one accounting period.
"GAAP" or "Generally Accepted Accounting Principles" means
generally accepted accounting principles, being those principles of
accounting set forth in pronouncements of the Financial Accounting
Standards Board or the American Institute
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<PAGE>
of Certified Public Accountants or which have other substantial
authoritative support and are applicable in the circumstances as of the
date of a report.
"Governmental Authority" means any Federal, state, municipal,
national or other governmental department, commission, board, bureau,
court, agency or instrumentality or political subdivision thereof or
any entity or officer exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to any
government or any court, in each case whether associated with a state
of the United States, the United States, or a foreign entity or
government.
"Guarantee" means the guarantee, substantially in the form of
Exhibit K, to which each Guarantor shall become a party.
"Guaranteed Obligations" of any Person means all guaranties
(including guaranties of guaranties and guaranties of dividends and
other monetary obligations), endorsements, assumptions and other
contingent obligations with respect to, or to purchase or to otherwise
pay or acquire, Indebtedness of others; provided, however, that such
term shall not include obligations under leases and other contracts
initially incurred directly by another Person and subsequently directly
assumed by the Person in question, but such term shall include
obligations that, if the same had been initially incurred directly by
the Person in question, would have constituted Guaranteed Obligations.
"Guarantor" means any Subsidiary of the Borrower that directly
or indirectly guarantees any Indebtedness of the Borrower and becomes a
party to the Guarantee.
"Hazardous Material" means and includes any pollutant,
contaminant, or hazardous, toxic or dangerous waste, substance or
material (including without limitation petroleum products,
asbestos-containing materials, and lead), the generation, handling,
storage, disposal, treatment or emission of which is subject to any
Environmental Law.
"HCFA" means the United States Health Care Financing
Administration and any successor thereto.
"Headquarters Lease" means the Amended and Restated Lease
Agreement dated as of October 31, 2000, between First Security Bank,
National Association, a national banking association, not individually,
but solely as Owner Trustee under the HEALTHSOUTH Corporation Trust
1995-1, as Lessor and HEALTHSOUTH Holdings, Inc., a Delaware
corporation, as Lessee, as such Lease Agreement may be amended,
modified, supplemented or restated in its entirety from time to time.
"Headquarters Obligations" means all of the Holder Advances
and Loans, as each such term is defined in the Headquarters
Participation Agreement.
"Headquarters Participation Agreement" means the Amended and
Restated Participation Agreement dated as of October 31, 2000 by and
among HEALTHSOUTH HOLDINGS, INC., as Lessee, FIRST SECURITY BANK,
NATIONAL ASSOCIATION, a national banking association, not individually,
except as expressly stated herein, but solely as Owner Trustee under
the HEALTHSOUTH Corporation Trust
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<PAGE>
1995-1, THE CHASE MANHATTAN BANK, as Documentation Agent; UBS WARBURG
LLC and DEUTSCHE BANK SECURITIES, INC., as Joint Lead Arrangers;
DEUTSCHE BANK AG NEW YORK BRANCH, as Syndication Agent; UBS AG,
Stamford Branch, as Administrative Agent for the Lenders and the
Holders; UBS AG, Stamford Branch, and the various other banks and
lending institutions which are parties thereto from time to time as
Holders, and UBS AG, Stamford Branch and the various other banks and
lending institutions which are parties thereto from time to time as
Lenders, as such Headquarters Participation Agreement may be amended,
modified, supplemented or restated in its entirety from time to time.
"Hospitals Lease" means the Lease Agreement dated as of
October 31, 2000, between First Security Bank, a national banking
association, not individually, but solely as Owner Trustee under the
HEALTHSOUTH Corporation Trust 2000-1, as Lessor, and HEALTHSOUTH
Corporation, a Delaware corporation, as Lessee, as such Lease Agreement
may be amended, modified, supplemented or restated in its entirety from
time to time.
"Hospitals Obligations" means all of the Holder Advances and
Loans, as each such term is defined in the Hospitals Participation
Agreement.
"Hospitals Participation Agreement" means the Participation
Agreement dated as of October 31, 2000 by and among HEALTHSOUTH
Corporation., as Lessee, FIRST SECURITY BANK, NATIONAL ASSOCIATION, a
national banking association, not individually, except as expressly
stated therein, but solely as Owner Trustee under the HEALTHSOUTH
Corporation Trust 2000-1, THE CHASE MANHATTAN BANK, as Documentation
Agent; UBS WARBURG LLC and DEUTSCHE BANK SECURITIES, INC., as Joint
Lead Arrangers; DEUTSCHE BANK AG NEW YORK BRANCH, as Syndication Agent;
UBS AG, Stamford Branch, as Administrative Agent for the Lenders and
the Holders; UBS AG, Stamford Branch, and the various other banks and
lending institutions which are parties thereto from time to time as
Holders, and UBS AG, Stamford Branch and the various other banks and
lending institutions which are parties thereto from time to time as
Lenders, as such Hospitals Participation Agreement may be amended,
modified, supplemented or restated in its entirety from time to time.
"Indebtedness" of any Person at any date means, without
duplication: (i) all indebtedness of such Person for borrowed money
(whether or not the recourse of the lender is to the whole of the
assets of such Person or only to a portion thereof); (ii) all
obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments; (iii) all obligations (contingent or
otherwise) of such Person in respect of letters of credit or other
similar instruments (or reimbursement obligations with respect
thereto); (iv) all obligations of such Person with respect to Rate
Hedging Obligations (excluding, for all purposes of this Agreement
other than Section 9.1(e), those that fix the interest rate on variable
rate indebtedness otherwise permitted hereunder or that protect the
Borrower and or its Consolidated Entities against changes in foreign
exchange rates); (v) obligations of such Person to pay the deferred and
unpaid purchase price of property or services, except trade payables
and accrued expenses incurred in the ordinary course of business; (vi)
all Capitalized Lease Obligations of such Person; (vii) all
indebtedness of
14
<PAGE>
others secured by a Lien on any assets of such Person, whether or not
such indebtedness is assumed by such Person; (viii) all Guaranteed
Obligations; (ix) the Headquarters Obligations and the Hospitals
Obligations; and (x) all obligations of a like nature to those
described in clauses (i) through (ix) above of a partnership of which
such Person is a general partner or of a limited liability company of
which such Person is a member. The amount of Indebtedness of any Person
at any date shall be the outstanding balance at such date of all
unconditional obligations as described above, the maximum liability of
such Person for any such contingent obligations at such date and, in
the case of clause (vii), the amount of the Indebtedness secured.
"Interbank Offered Rate" means, for any Eurodollar Rate Loan
for the Interest Period applicable thereto, the rate per annum (rounded
upwards, if necessary, to the nearest one-one hundredth (1/100) of one
percent) appearing on Dow Jones Telerate Page 3750 (or any successor
page) as the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two Business Days prior to the
first day of such Interest Period for a term comparable to such
Interest Period. If for any reason, as determined by the Administrative
Agent, such rate is not available, the term "Interbank Offered Rate"
means, for any Eurodollar Rate Loan for the Interest Period applicable
thereto, the rate per annum (rounded upwards, if necessary, to the
nearest 1 /100 of 1 %) appearing on Reuters Screen LIBO Page as the
London interbank offered rate for deposits in Dollars at approximately
11:00 a.m. (London time) two Business Days prior to the first day of
such Interest Period for a term comparable to such Interest Period;
provided, however, if more than one rate is specified on Reuters Screen
LIBO Page, the applicable rate shall be the arithmetic mean of all such
rates (rounded upwards, if necessary, to the nearest 1/100 of 1%).
"Interest Period" means, with respect to any Eurodollar Rate
Loan, each period commencing on the date such Eurodollar Rate Loan is
made or Converted from a Loan of another Type or the last day of the
next preceding Interest Period for such Loan and ending on the
numerically corresponding day in the first, second, third or sixth
calendar month thereafter, as the Borrower may select as provided in
Section 2.3, except that each Interest Period that commences on the
last Business Day of a calendar month (or on any day for which there is
no numerically corresponding day in the appropriate subsequent calendar
month) shall end on the last Business Day of the appropriate subsequent
calendar month. Notwithstanding the foregoing: (i) if any Interest
Period for any Eurodollar Rate Loan would otherwise end after the
Revolving Credit Termination Date (with respect to Revolving Credit
Loans) or the Facility Extension Loan Termination Date (with respect to
Facility Extension Loans), such Interest Period shall end on the
Revolving Credit Termination Date or the Facility Extension Loan
Termination Date, as applicable; (ii) each Interest Period that would
otherwise end on a day which is not a Business Day shall end on the
next succeeding Business Day (or, in the case of an Interest Period for
a Eurodollar Rate Loan, if such next succeeding Business Day falls in
the next succeeding calendar month, on the next preceding Business
Day); and (iii) notwithstanding clauses (i) and (ii) above, no Interest
Period for any Loan shall have a duration of less than one month (in
the case of a Eurodollar Rate Loan) and, if the Interest Period for any
Eurodollar Rate Loan would otherwise be a shorter period, such Loan
shall not be available hereunder for such period.
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<PAGE>
"Interest Rate Selection Notice" means the written notice
delivered by an Authorized Representative in connection with the
election of a subsequent Interest Period for any Eurodollar Rate Loan
or the Conversion of any Eurodollar Rate Loan into a Base Rate Loan or
the Conversion of any Base Rate Loan into a Eurodollar Rate Loan,
substantially in the form of Exhibit E.
"Issuing Bank" means UBS AG, Stamford Branch, as issuer of
Letters of Credit under Article III.
"LC Account Agreement" means the LC Account Agreement dated as
of the date hereof among the Borrower, the Administrative Agent and the
Lenders, as amended, modified or supplemented from time to time.
"Lender Addendum" means, with respect to any initial Lender, a
Lender Addendum, substantially in the form of Exhibit A, to be executed
and delivered by such Lender on the Closing Date as provided in Section
11.17.
"Letter of Credit" means a standby letter of credit issued by
the Issuing Bank pursuant to Article III for the account of the
Borrower in favor of a Person advancing credit or securing an
obligation on behalf of the Borrower.
"Letter of Credit Commitment" means, with respect to each
Lender, the obligation of such Lender to acquire Participations in
respect of Letters of Credit and Reimbursement Obligations up to an
aggregate amount at any one time outstanding equal to such Lender's
Applicable Commitment Percentage of the Total Letter of Credit
Commitment as the same may be increased or decreased from time to time
pursuant to this Agreement.
"Letter of Credit Facility" means, the facility described in
Article III providing for the issuance by the Issuing Bank for the
account of the Borrower of Letters of Credit in an aggregate stated
amount at any time outstanding not exceeding, together with all
Reimbursement Obligations, the Total Letter of Credit Commitment.
"Letter of Credit Outstandings" means, as of any date of
determination, the aggregate amount remaining undrawn under all Letters
of Credit plus Reimbursement Obligations then outstanding.
"Lien" means any interest in property securing any obligation
owed to, or a claim by, a Person other than the owner of the property,
whether such interest is based on the common law, statute or contract,
and including but not limited to the lien or security interest arising
from a mortgage, encumbrance, pledge, security agreement, conditional
sale or trust receipt or a lease, consignment or bailment for security
purposes. For the purposes of this Agreement, the Borrower and any
Subsidiary shall be deemed to be the owner of any property which it has
acquired or holds subject to a conditional sale agreement, financing
lease, or other arrangement pursuant to which title to the property has
been retained by or vested in some other Person for security purposes.
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"Loan" or "Loans" means any Revolving Credit Loans,
Reimbursement Obligations and Letter of Credit Outstandings and all
extensions and renewals thereof, including, if applicable and without
limitation, any Facility Extension Loans.
"Loan Documents" means this Agreement, the Notes, the LC
Account Agreement, the Applications and Agreements for Letter of Credit
and all other instruments and documents heretofore or hereafter
executed or delivered to or in favor of any Lender or the
Administrative Agent in connection with the Loans made, Letters of
Credit issued and transactions contemplated under this Agreement, as
the same may be amended, supplemented or replaced from time to time.
"Material Adverse Effect" means a material adverse effect on
(i) the business, properties, operations, condition or prospects,
financial or otherwise, of the Borrower and its Consolidated Entities,
taken as a whole, (ii) the ability of the Borrower to pay or perform
its obligations, liabilities and indebtedness under the Loan Documents
as such payment or performance becomes due in accordance with the terms
thereof, or (iii) the rights, powers and remedies of the Administrative
Agent or any Lender under any Loan Document or the validity, legality
or enforceability thereof (including for purposes of clauses (ii) and
(iii) the imposition of burdensome conditions thereon).
"Material Group" means, at any time, any group, whether one or
more, or combination of Consolidated Entities (a) whose assets, in the
aggregate, constitute 5% or more of the assets of the Borrower and the
Consolidated Entities on a consolidated basis or (b) whose net
revenues, in the aggregate, constitute 5% or more of the net revenues
of the Borrower and the Consolidated Entities on a consolidated basis.
"Medicaid Certification" means certification by HCFA or a
state agency or entity under contract with HCFA that a health care
operation is in compliance with all the conditions of participation set
forth in the Medicaid Regulations.
"Medicaid Provider Agreement" means an agreement entered into
between a state agency or other entity administering the Medicaid
program and a health care operation under which the health care
operation agrees to provide services for Medicaid patients in
accordance with the terms of the agreement and Medicaid Regulations.
"Medicaid Regulations" means, collectively, (i) all federal
statutes (whether set forth in Title XIX of the Social Security Act or
elsewhere) affecting the medical assistance program established by
Title XIX of the Social Security Act and any statutes succeeding
thereto; (ii) all applicable provisions of all federal rules,
regulations, manuals and orders of all Governmental Authorities
promulgated pursuant to or in connection with the statutes described in
clause (i) above and all federal administrative, reimbursement and
other guidelines of all Governmental Authorities having the force of
law promulgated pursuant to or in connection with the statutes
described in clause (i) above; (iii) all state statutes and plans for
medical assistance enacted in connection with the statutes and
provisions described in clauses (i) and (ii) above; and (iv) all
applicable provisions of all rules, regulations, manuals and orders of
all Governmental Authorities promulgated pursuant to or in connection
with the statutes described in clause (iii) above
17
<PAGE>
and all state administrative, reimbursement and other guidelines of all
Governmental Authorities having the force of law promulgated pursuant
to or in connection with the statutes described in clause (ii) above,
in each case as may be amended, supplemented or otherwise modified from
time to time.
"Medicare Certification" means certification by HCFA or a
state agency or entity under contract with HCFA that a health care
operation is in compliance with all the conditions of participation set
forth in the Medicare Regulations.
"Medicare Provider Agreement" means an agreement entered into
between a state agency or other entity administering the Medicare
program and a health care operation under which the health care
operation agrees to provide services for Medicare patients in
accordance with the terms of the agreement and Medicare Regulations.
"Medicare Regulations" means, collectively, all federal
statutes (whether set forth in Title XVIII of the Social Security Act
or elsewhere) affecting the health insurance program for the aged and
disabled established by Title XVIII of the Social Security Act and any
statutes succeeding thereto; together with all applicable provisions of
all rules, regulations, manuals and orders and administrative,
reimbursement and other guidelines having the force of law of all
Governmental Authorities (including without limitation, Health and
Human Services ("HHS"), HCFA, the Office of the Inspector General for
HHS, or any Person succeeding to the functions of any of the foregoing)
promulgated pursuant to or in connection with any of the foregoing
having the force of law, as each may be amended, supplemented or
otherwise modified from time to time.
"Moody's" means Moody's Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined
in Section 4001(a)(3) of ERISA to which the Borrower or any ERISA
Affiliate is making, or is accruing an obligation to make,
contributions or has made, or been obligated to make, contributions
within the preceding six (6) Fiscal Years.
"1999 10-K" means the Borrower's Annual Report on Form 10-K
for the Fiscal Year Ended December 31, 1999
"Notes" means, the promissory notes of the Borrower evidencing
the Loans executed and delivered to the Lenders as provided in Section
2.6, substantially in the form of Exhibit F, with appropriate
insertions as to amounts, dates and names of Lenders.
"Obligations" means the obligations, liabilities and
Indebtedness of the Borrower with respect to (i) the principal and
interest on the Loans, (ii) the Reimbursement Obligations and otherwise
in respect of the Letters of Credit, (iii) all liabilities of the
Borrower to any Lender which arise under a Swap Agreement, and (iv) the
payment and performance of all other obligations, liabilities and
Indebtedness of the Borrower to the Lenders or the Administrative Agent
hereunder, under any one or more of the other Loan Documents or with
respect to the Loans.
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"Participation" means, with respect to any Lender (other than
the Issuing Bank) and a Letter of Credit, the extension of credit
represented by the participation of such Lender hereunder in the
liability of the Issuing Bank in respect of a Letter of Credit issued
by the Issuing Bank in accordance with the terms hereof.
"PBGC" means the Pension Benefit Guaranty Corporation and any
successor thereto.
"Pension Plan" means any employee pension benefit plan within
the meaning of Section 3(2) of ERISA, other than a Multiemployer Plan,
which is subject to the provisions of Title IV of ERISA or Section 412
of the Code and which (i) is maintained for employees of the Borrower
or any of its ERISA Affiliates or is assumed by the Borrower or any of
its ERISA Affiliates in connection with any Acquisition or (ii) has at
any time been maintained for the employees of the Borrower or any
current or former ERISA Affiliate.
"Permitted Encumbrances" means:
(1) liens for taxes, assessments and other governmental
charges that are not delinquent or that are being contested in good
faith by appropriate proceedings duly pursued;
(2) mechanic's, materialmen's, contractor's, landlord's or
other similar liens arising in the ordinary course of business,
securing obligations that are not delinquent or that are being
contested in good faith by appropriate proceedings duly pursued;
(3) restrictions, exceptions, reservations, easements,
conditions, limitations and other matters of record that do not
materially adversely affect the value or utility of the affected
property;
(4) Liens on assets securing Indebtedness the proceeds of
which are used to acquire such
assets;
(5) Liens and other matters approved in writing by the
Required Lenders; and
(6) Liens in favor of landlords, the amount secured by which
landlords' Liens, in the aggregate, would not materially adversely
affect the Borrower or a Material Group.
"Permitted Investments" means:
(1) direct obligations of, or obligations the payment of which
is guaranteed by, the United States of America or an interest in any
trust or fund that invests solely in such obligations or repurchase
agreements, properly secured, with respect to such obligations.
(2) direct obligations of agencies or instrumentalities of the
United States of America having a rating of A or higher by S&P or A2 or
higher by Moody's;
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(3) a certificate of deposit issued by, or other
interest-bearing deposits with, a bank which is a Lender or an
affiliate of a Lender, or a bank having its principal place of business
in the United States of America and having equity capital of not less
than $250,000,000;
(4) a certificate of deposit issued by, or other
interest-bearing deposits with, any other bank organized under the laws
of the United States of America or any state thereof, provided that
such deposit is either (i) insured by the Federal Deposit Insurance
Corporation or (ii) properly secured by such bank by pledging direct
obligations of the United States of America having a market value not
less than the face amount of such deposits;
(5) the capital stock of and partnership interests in, and
loans made by the Borrower to, Controlled Partnerships and
Subsidiaries;
(6) prime commercial paper maturing within 270 days of the
acquisition thereof and, at the time of acquisition, having a rating of
A-1 or higher by S&P, or P-1 or higher by Moody's;
(7) eligible banker's acceptances, repurchase agreements and
tax-exempt municipal bonds having a maturity of less than one year, in
each case having a rating, or that is the full recourse obligation of a
person whose senior debt is rated, A or higher by S&P or A2 or higher
by Moody's;
(8) loans made by the Borrower or a Consolidated Entity in an
aggregate amount of $2,000,000 or less to employees of the Borrower or
of a Consolidated Entity;
(9) loans made by the Borrower or a Controlled Partnership in
an aggregate amount of $1,000,000 or less to limited partners (or
potential limited partners) of Controlled Partnerships for the purpose
of enabling such limited partners to acquire limited partnership
interests in Controlled Partnerships, to operate their practices or to
restructure partnership interests;
(10) loans in an aggregate amount of up to $20,000,000 made by
the Borrower to the HEALTHSOUTH Employee Stock Benefit Plan;
(11) scholarship loans made by the Borrower in an aggregate
amount not exceeding $1,000,000 to individuals who meet certain
eligibility requirements as established by the Borrower from time to
time;
(12) up to 100% of the outstanding shares of stock of
Caretenders Healthcorp (formerly known as Senior Services, Inc.)
provided that aggregate costs incurred to purchase such shares shall
not exceed $12,000,000;
(13) other investments of less than $5,000,000 in the
aggregate expressly approved in writing by the Administrative Agent and
investments of $5,000,000 or greater expressly approved in writing by
the Required Lenders;
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(14) any other investment having a rating of A or higher or
A-1 or higher by S&P or A2 or higher or P-1 or higher by Moody's;
(15) loans to health care practitioners and other persons not
to exceed in the aggregate $5,000,000;
(16) investments in Acacia Venture Partners, HEALTHSMART,
Caremark Rx, Inc. and Austin Medical Office Building which in the
aggregate do not exceed $5,000,000; and
(17) additional investments existing on the Closing Date and
described in Exhibit G.
"Person" means an individual, partnership, corporation,
limited liability company, trust, unincorporated organization,
association, joint venture or a government or agency or political
subdivision thereof.
"Prime Rate" means the per annum rate of interest established
from time to time by the Administrative Agent as its prime rate, which
rate may not be the lowest rate of interest charged by the
Administrative Agent to its customers.
"Principal Office" means the office of the Administrative
Agent at 677 Washington Boulevard, Stamford, Connecticut 06901,
Attention: Jennifer Poccia, or such other office and address as the
Administrative Agent may from time to time designate.
"Rate Hedging Obligations" means any and all obligations of
the Borrower or any Consolidated Entity, whether absolute or contingent
and howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all agreements, devices or
arrangements designed to protect the Borrower or such Consolidated
Entity from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or
exchange transactions, including, but not limited to,
Dollar-denominated or cross-currency interest rate exchange agreements,
forward currency exchange agreements, interest rate cap or collar
protection agreements, forward rate currency or interest rate options,
puts, warrants and those commonly known as interest rate "swap"
agreements; and (ii) any and all cancellations, buybacks, reversals,
terminations or assignments of any of the foregoing.
"Rating" means the rating of senior unsecured Indebtedness of
the Borrower in effect at any time which rating is made by either of
Moody's or S&P.
"Regulation D" means Regulation D of the Board as the same may
be amended or supplemented from time to time.
"Reimbursement Obligation" means, at any time, the obligation
of the Borrower with respect to any Letter of Credit to reimburse the
Issuing Bank and the Lenders to the extent of their respective
Participations (including by the receipt by the Issuing Bank of
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proceeds of Loans pursuant to Section 3.2) for amounts theretofore paid
by the Issuing Bank pursuant to a drawing under such Letter of Credit.
"Required Lenders" means, as of any date, Lenders on such date
having Credit Exposures (as defined below) aggregating at least 51% of
the aggregate Credit Exposures of all the Lenders on such date. For
purposes of the preceding sentence, the amount of the "Credit Exposure"
of each Lender shall be equal to the aggregate principal amount of the
Loans, so long as there exists no Event of Default, owing to such
Lender plus the aggregate unutilized amounts of such Lender's Revolving
Credit Commitment plus the amount of such Lender's Applicable
Commitment Percentage of Letter of Credit Outstandings; provided that,
if any Lender shall have failed to pay to the Issuing Bank its
Applicable Commitment Percentage of any drawing under any Letter of
Credit resulting in an outstanding Reimbursement Obligation, such
Lender's Credit Exposure attributable to Letters of Credit and
Reimbursement Obligations shall be deemed to be held by the Issuing
Bank for purposes of this definition.
"Reserve Requirement" means, at any time, the maximum rate at
which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained
under regulations issued from time to time by the Board by member banks
of the Federal Reserve System (or any successor) by member banks of the
Federal Reserve System against "Eurocurrency liabilities" (as such term
is used in Regulation D). Without limiting the effect of the foregoing,
the Reserve Requirement shall reflect any other reserves required to be
maintained by such member banks with respect to (i) any category of
liabilities which includes deposits by reference to which the
Eurodollar Rate is to be determined, or (ii) any category of extensions
of credit or other assets which include Eurodollar Rate Loans. The
Eurodollar Rate shall be adjusted automatically on and as of the
effective date of any change in the Reserve Requirement.
"Restricted Payment" means (a) any dividend or other
distribution, direct or indirect, on account of any shares of any class
of stock of Borrower or any of its Consolidated Entities (other than
those payable or distributable solely to the Borrower) now or hereafter
outstanding, except a dividend payable solely in shares of a class of
stock to the holders of that class; (b) any redemption, conversion,
exchange, retirement or similar payment, purchase or other acquisition
for value, direct or indirect, of any shares of any class of stock of
the Borrower or any of its Consolidated Entities (other than those
payable or distributable solely to the Borrower) now or hereafter
outstanding; (c) any payment made to retire, or to obtain the surrender
of, any outstanding warrants, options or other rights to acquire shares
of any class of stock of the Borrower or any of its Consolidated
Entities now or hereafter outstanding; (d) any issuance and sale of
capital stock of any Consolidated Entity of the Borrower (or any
option, warrant or right to acquire such stock) other than to the
Borrower; and (e) any optional or voluntary payment, prepayment,
repurchase or redemption of, or otherwise voluntary or optional
defeasance of any Subordinated Debt, including, without limitation, the
New Senior Subordinated Notes and the Convertible Subordinated
Debentures, or the segregation of funds for any such payment,
prepayment, repurchase, redemption or defeasance.
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"Revolving Credit Commitment" means, with respect to each
Lender, the obligation of such Lender to make Revolving Credit Loans to
the Borrower up to an aggregate principal amount at any one time
outstanding equal to such Lender's Applicable Commitment Percentage of
the Total Revolving Credit Commitment.
"Revolving Credit Facility" means the facility described in
Article II providing for Loans to the Borrower by the Lenders in the
aggregate principal amount of the Total Revolving Credit Commitment.
"Revolving Credit Loan" means any borrowing pursuant to an
Advance provided for by Section 2.1, which may be Base Rate Loans or
Eurodollar Rate Loans.
"Revolving Credit Outstandings" means, as of any date of
determination, the aggregate principal amount of all Revolving Credit
Loans then outstanding.
"Revolving Credit Termination Date" means (i) the Stated
Termination Date or (ii) such earlier date of termination of Lenders'
obligations hereunder as may be determined pursuant to Section 9.1 upon
the occurrence of an Event of Default, or (iii) such date on which the
Borrower may voluntarily and permanently terminate the Revolving Credit
Facility by payment in full of all Revolving Credit Outstandings and
all Letter of Credit Outstandings and cancellation of all Letters of
Credit, together with all accrued and unpaid interest and fees thereon.
"S&P" means Standard & Poor's Rating Group, a division of The
McGraw Hill Companies.
"Senior Debt" means (i) the Obligations and (ii) all
obligations of the Borrower and its Subsidiaries, now or hereafter
existing under the Credit Agreement dated as of June 23, 1998 by and
among the Borrower, as borrower, Nationsbank National Association, as
Administrative Agent and Arranger, J.P. Morgan Securities Inc.,
Deutsche Bank AG and Scotiabanc, Inc., as Syndication Agents and
Co-Arrangers, and the other lenders party thereto from time to time, as
amended and in effect from time to time.
"Single Employer Plan" means any employee pension benefit plan
covered by Title IV of ERISA in respect of which the Borrower or any
Subsidiary is an "employer" as described in Section 4001(b) of ERISA
and which is not a Multiemployer Plan.
"Solvent" means, when used with respect to any Person, that at
the time of determination:
(i) the fair value of its assets (both at fair valuation and
at present fair saleable value on an orderly basis) is in excess of the
total amount of its liabilities, including contingent obligations; and
(ii) it is then able and expects to be able to pay its debts
as they mature; and
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(iii) it has capital sufficient to carry on its business as
conducted and as proposed to be conducted.
"Stated Termination Date" means October 30, 2001.
"Subordinated Debt" means any unsecured Indebtedness of the
Borrower or any Consolidated Entity (other than inter-company
Indebtedness) which is subordinated in right of payment in all respects
to the Senior Debt in a manner reasonably acceptable to the
Administrative Agent.
"Subsidiary" means any corporation or other entity in which
more than 50% of its outstanding Voting Stock or more than 50% of all
equity interests is owned directly or indirectly by the Borrower and/or
by one or more of the Borrower's Subsidiaries.
"Swap Agreement" means one or more agreements between the
Borrower and any Person with respect to any Indebtedness under the Loan
Documents, on terms mutually acceptable to Borrower and such Person and
approved by each of the Lenders, which agreements create Rate Hedging
Obligations; provided, however, that no such approval of the Lenders
shall be required to the extent such agreements are entered into
between the Borrower and any Lender.
"Termination Event" means: (i) a "Reportable Event" described
in Section 4043 of ERISA and the regulations issued thereunder (unless
the notice requirement has been waived by applicable regulation); or
(ii) the withdrawal of the Borrower or any ERISA Affiliate from a
Pension Plan during a plan year in which it was a "substantial
employer" as defined in Section 4001 (a)(2) of ERISA or was deemed such
under Section 4062(e) of ERISA; or (iii) the termination of a Pension
Plan, the filing of a notice of intent to terminate a Pension Plan or
the treatment of a Pension Plan amendment as a termination under
Section 4041 of ERISA; or (iv) the institution of proceedings to
terminate a Pension Plan by the PBGC; or (v) any other event or
condition which would constitute grounds under Section 4042(a) of ERISA
for the termination of, or the appointment of a trustee to administer,
any Pension Plan; or (vi) the partial or complete withdrawal of the
Borrower or any ERISA Affiliate from a Multiemployer Plan; or (vii) the
imposition of a Lien pursuant to Section 412 of the Code or Section 302
of ERISA; or (viii) any event or condition which results in the
reorganization or insolvency of a Multiemployer Plan under Section 4241
or Section 4245 of ERISA, respectively; or (ix) any event or condition
which results in the termination of a Multiemployer Plan under Section
4041A of ERISA or the institution by the PBGC of proceedings to
terminate a Multiemployer Plan under Section 4042 of ERISA.
"Total Letter of Credit Commitment" means an amount not to
exceed $20,000,000.
"Total Revolving Credit Commitment" means a principal amount
equal to $400,000,000, as reduced from time to time in accordance with
Section 2.1(a) and Section 2.8.
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"Unused Amount" means with respect to each Lender, (a) the
Revolving Credit Commitment of such Lender less (b) such Lender's pro
rata share of outstanding Revolving Credit Loans and Letter of Credit
Outstandings; provided that in no event shall such amount be a negative
number.
"Vanderbilt" means Vanderbilt Stallworth Rehabilitation
Hospital, L.P., the partners of which are the Borrower, Vanderbilt
University and Vanderbilt Health Services.
"Voting Stock" means shares of Capital Stock issued by a
corporation, or equivalent interests in any other Person, the holders
of which are ordinarily, in the absence of contingencies, entitled to
vote for the election of directors (or persons performing similar
functions) of such Person, even if the right so to vote has been
suspended by the happening of such a contingency.
(b) Other Defined Terms. The following terms shall have the
meanings defined for such terms in the Sections set forth
below:
Term Section
----- -------
Administrative Agent Preamble
Affected Loans 4.4
Affected Type 4.4
Compliance Certificate 7.1(c)
Contractual Obligation 6.2(c)
Eurodollar Margin 2.2(c)(ii)(C)
Event of Default 9.1
Facility Extension Loan 2.2(b)
Facility Extension Loan Maturity Date 2.2(b)
Facility Extension Notice 2.2(a)
Indemnified Parties 11.12
Indemnified Liabilities 11.12
New Senior Subordinated Notes 5.1(c)
Notice of Default 10.3
Other Taxes 4.6(b)
Pro Forma Financial Statements 6.6(d)
Refinancing 5.1(c)
Register 11.1(b)
Related LC Documents 3.2(i)
Requirement of Law 6.2(b)
Taxes 4.6(a)
1.2. Rules of Interpretation.
(a) All accounting terms not specifically defined herein shall
have the meanings assigned to such terms and shall be interpreted in accordance
with GAAP applied on a Consistent Basis.
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(b) The headings, subheadings and table of contents used
herein or in any other Loan Document are solely for convenience of reference and
shall not constitute a part of any such document or affect the meaning,
construction or effect of any provision thereof.
(c) Except as otherwise expressly provided, references herein
to articles, sections, paragraphs, clauses, annexes, appendices, exhibits and
schedules are references to articles, sections, paragraphs, clauses, annexes,
appendices, exhibits and schedules in or to this Agreement.
(d) All definitions set forth herein or in any other Loan
Document shall apply to the singular as well as the plural form of such defined
term, and all references to the masculine gender shall include reference to the
feminine or neuter gender, and vice versa, as the context may require.
(e) When used herein or in any other Loan Document, words such
as "hereunder", "hereto", "hereof" and "herein" and other words of like import
shall, unless the context clearly indicates to the contrary, refer to the whole
of the applicable document and not to any particular article, section,
subsection, paragraph or clause thereof.
(f) References to "including" means including without limiting
the generality of any description preceding such term, and for purposes hereof
the rule of ejusdem generis shall not be applicable to limit a general
statement, followed by or referable to an enumeration of specific matters, to
matters similar to those specifically mentioned.
(g) All dates and times of day specified herein shall refer to
such dates and times at New York, New York.
(h) Each of the parties to the Loan Documents and their
counsel have reviewed and revised, or requested (or had the opportunity to
request) revisions to, the Loan Documents, and any rule of construction that
ambiguities are to be resolved against the drafting party shall be inapplicable
in the construing and interpretation of the Loan Documents and all exhibits,
schedules and appendices thereto.
(i) Any reference to an officer of the Borrower or any other
Person by reference to the title of such officer shall be deemed to refer to
each other officer of such Person, however titled, exercising the same or
substantially similar functions.
(j) All references to any agreement or document as amended,
modified or supplemented, or words of similar effect, shall mean such document
or agreement, as the case may be, as amended, modified or supplemented from time
to time only as and to the extent permitted therein and in the Loan Documents.
1.3. Classes and Types of Loans. Loans hereunder are
distinguished by Class and Type. The Class of a Loan refers to whether such Loan
is a Revolving Credit Loan or a Facility Extension Loan. The "Type" of a Loan
refers to whether such Loan is a Base Rate Loan or a Eurodollar Rate Loan, each
of which constitutes a Type. Loans may be identified by both Class and Type.
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ARTICLE II
The Loans
2.1. Revolving Credit Loans. (a) Commitment. Subject to the
terms and conditions of this Agreement, each Lender severally agrees to make
Advances to the Borrower under the Revolving Credit Facility from time to time
from the Closing Date until the Revolving Credit Termination Date (such Advance
by each Lender being made on a pro rata basis as to the total borrowing
requested by the Borrower on any day determined by such Lender's Applicable
Commitment Percentage), in an aggregate principal amount for each Lender up to
but not exceeding the Revolving Credit Commitment of such Lender, provided,
however, that (i) the Lenders will not be required and shall have no obligation
to make any such Advance if the applicable conditions precedent thereto set
forth in Article V have not been satisfied and (ii) immediately after giving
effect to each such Advance, the principal amount of Revolving Credit
Outstandings plus Letter of Credit Outstandings shall not exceed the Total
Revolving Credit Commitment. Within such limits, the Borrower may borrow, repay
and reborrow under the Revolving Credit Facility on any Business Day from the
Closing Date until, but (as to borrowings and reborrowings) not including, the
Revolving Credit Termination Date; provided, however, that (y) no Revolving
Credit Loan that is a Eurodollar Rate Loan shall be made which has an Interest
Period that extends beyond the Revolving Credit Termination Date and (z) each
Revolving Credit Loan that is a Eurodollar Rate Loan may, subject to the
provisions of Section 2.4, be repaid only on the last day of the Interest Period
with respect thereto unless such payment is accompanied by the additional
payment, if any, required by Section 4.5.
(b) Amounts. The aggregate unpaid principal amount of the
Revolving Credit Outstandings plus Letter of Credit Outstandings shall not
exceed the Total Revolving Credit Commitment and, in the event there shall be
outstanding any such excess, the Borrower shall immediately make such payments
and prepayments as shall be necessary to comply with this restriction. Each
Revolving Credit Loan hereunder, other than Base Rate Refunding Loans, and each
Conversion under Section 2.9, shall be in an amount of at least $2,000,000, and,
if greater than $2,000,000, an integral multiple of $500,000 with respect to
Eurodollar Rate Loans and $100,000 with respect to Base Rate Loans.
(c) Advances. (i) An Authorized Representative shall give the
Administrative Agent (1) at least three (3) Business Days' irrevocable written
notice by telefacsimile transmission of a Borrowing Notice or Interest Rate
Selection Notice (as applicable) with appropriate insertions, effective upon
receipt, of each Revolving Credit Loan that is a Eurodollar Rate Loan (whether
representing an additional borrowing hereunder or the Conversion of a borrowing
hereunder from Base Rate Loans to Eurodollar Rate Loans) prior to 10:30 A.M. and
(2) irrevocable written notice by telefacsimile transmission of a Borrowing
Notice or Interest Rate Selection Notice (as applicable) with appropriate
insertions, effective upon receipt, of each Revolving Credit Loan (other than
Base Rate Refunding Loans to the extent the same are effected without notice
pursuant to Section 2.1(c)(iv)) that is a Base Rate Loan (whether representing
an additional borrowing hereunder or the Conversion of borrowing hereunder from
Eurodollar Rate Loans to Base Rate Loans) prior to 10:30 A.M. on the day of such
proposed Revolving Credit Loan. Each such notice shall specify the amount of the
borrowing, the Type of Loan (Base Rate or Eurodollar Rate), the date of
borrowing and if a
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Eurodollar Rate Loan the Interest Period to be used in the computation of
interest. Notice of receipt of such Borrowing Notice or Interest Rate Selection
Notice, as the case may be, together with the amount of each Lender's portion of
an Advance requested thereunder, shall be provided by the Administrative Agent
to each Lender by telefacsimile transmission with reasonable promptness, but
(provided the Administrative Agent shall have received such notice by 10:30
A.M.) not later than 1:00 P.M. on the same day as the Administrative Agent's
receipt of such notice.
(ii) Not later than 2:00 P.M. on the date specified for each
borrowing under this Section 2.1, each Lender shall, pursuant to the terms and
subject to the conditions of this Agreement, make the amount of the Loan or
Loans to be made by it on such day available by wire transfer to the
Administrative Agent in the amount of its pro rata share determined according to
such Lender's Applicable Commitment Percentage of the Revolving Credit Loans to
be made on such day. Such wire transfer shall be directed to the Administrative
Agent at the Principal Office and shall be in the form of Dollars constituting
immediately available funds. The amount so received by the Administrative Agent
shall, subject to the terms and conditions of this Agreement, be made available
to the Borrower by delivery of the proceeds thereof as shall be directed in the
applicable Borrowing Notice by the Authorized Representative and reasonably
acceptable to the Administrative Agent.
(iii) The Borrower shall have the option to elect the duration
of the initial and any subsequent Interest Periods and to Convert the Revolving
Credit Loans in accordance with Section 2.9. Eurodollar Rate Loans and Base Rate
Loans may be outstanding at the same time; provided, however, there shall not be
outstanding at any one time Revolving Credit Loans having more than eight (8)
different Interest Periods. If the Administrative Agent does not receive a
Borrowing Notice or an Interest Rate Selection Notice giving notice of election
of the duration of an Interest Period or of Conversion of any Loan to or
Continuation of a Loan as a Eurodollar Rate Loan by the time prescribed by
Section 2.1(c) or 2.9, the Borrower shall be deemed to have elected to Convert
such Loan to (or Continue such Loan as) a Base Rate Loan until the Borrower
notifies the Administrative Agent in accordance with Section 2.9.
(iv) Notwithstanding the foregoing, if a drawing is made under
any Letter of Credit, such drawing is honored by the Issuing Bank prior to the
Revolving Credit Termination Date, and the Borrower shall not immediately fully
reimburse the Issuing Bank in respect of such drawing, (A) provided that the
conditions to making a Revolving Credit Loan as herein provided shall then be
satisfied, the Reimbursement Obligation arising from such drawing shall be paid
to the Issuing Bank by the Administrative Agent without the requirement of
notice to or from the Borrower from immediately available funds which shall be
advanced as a Base Rate Refunding Loan by each Lender under the Revolving Credit
Facility in an amount equal to such Lender's Applicable Commitment Percentage of
such Reimbursement Obligation, and (B) if the conditions to making a Loan as
herein provided shall not then be satisfied, each of the Lenders shall fund by
payment to the Administrative Agent (for the benefit of the Issuing Bank) in
immediately available funds the purchase from the Issuing Bank of their
respective Participations in the related Reimbursement Obligation based on their
respective Applicable Commitment Percentages. If a drawing is presented under
any Letter of Credit in accordance with the terms thereof and the Borrower shall
not immediately reimburse the Issuing Bank in respect thereof, then notice of
such drawing or payment shall be provided promptly by the Issuing Bank to the
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Administrative Agent and the Administrative Agent shall provide notice to each
Lender by telephone or telefacsimile transmission. If notice to the Lenders of a
drawing under any Letter of Credit is given by the Administrative Agent at or
before 12:00 noon on any Business Day, each Lender shall, pursuant to the
conditions specified in this Section 2.1(c)(iv), either make a Base Rate
Refunding Loan or fund the purchase of its Participation in the amount of such
Lender's Applicable Commitment Percentage of such drawing or payment and shall
pay such amount to the Administrative Agent for the account of the Issuing Bank
at the Principal Office in Dollars and in immediately available funds before
2:30 P.M. on the same Business Day. If notice to the Lenders of a drawing under
a Letter of Credit is given by the Administrative Agent after 12:00 noon on any
Business Day, each Lender shall, pursuant to the conditions specified in this
Section 2.1(c)(iv), either make a Base Rate Refunding Loan or fund the purchase
of its Participation in the amount of such Lender's Applicable Commitment
Percentage of such drawing or payment and shall pay such amount to the
Administrative Agent for the account of the Issuing Bank at the Principal Office
in Dollars and in immediately available funds before 12:00 noon on the next
following Business Day. Any such Base Rate Refunding Loan shall be deemed to be
advanced as a Base Rate Loan as of the date the relevant drawing is honored by
the Issuing Bank, and shall Continue as a Base Rate Loan unless and until the
Borrower Converts such Base Rate Loan in accordance with the terms of Section
2.9.
2.2. Facility Extension Loans. (a) The Borrower may, by
written irrevocable notice to the Administrative Agent (such notice being a
"Facility Extension Notice") given no later than sixty days prior to the Stated
Termination Date, convert the Revolving Credit Outstandings on the Stated
Termination Date into term loans on the terms and conditions set forth in this
Section 2.2; provided, however, that the Lenders will not be required and shall
have no obligation to convert any Revolving Credit Outstandings pursuant to the
terms in this Section 2.2 if the applicable conditions precedent thereto set
forth in Article V have not been satisfied. No Facility Extension Loan that is a
Eurodollar Rate Loan shall be made which has an Interest Period that extends
beyond the Facility Extension Loan Termination Date and each Facility Extension
Loan that is a Eurodollar Rate Loan may, subject to the provisions of Section
2.4, be repaid only on the last day of the Interest Period with respect thereto
unless such payment is accompanied by the additional payment, if any, required
by Section 4.5. The Administrative Agent shall promptly transmit any Facility
Extension Notice to each Lender.
(b) If the Borrower delivers a Facility Extension Notice, each
Lender severally agrees that the Revolving Credit Outstandings owing to such
Lender on the Stated Termination Date shall be converted into a term loan (a
"Facility Extension Loan") with a maturity date of June 22, 2003 (the "Facility
Extension Loan Maturity Date"). The Facility Extension Loans may from time to
time be Base Rate Loans or Eurodollar Loans, as determined by the Borrower and
notified to the Administrative Agent in accordance with Sections 2.2(c) and 2.9.
(c) In the event that a Facility Extension Notice has been
delivered, an Authorized Representative shall give the Administrative Agent at
least three (3) Business Days' prior to the Stated Termination Date an
irrevocable written notice by telefacsimile transmission stating if all or any
portion of the Facility Extension Loans are to be Eurodoll