SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
___________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
FHP International Corporation
(Exact name of registrant as specified in its charter)
Delaware 33-0072502
(State of incorporation or organization) (I.R.S. Employer Identification No.)
9900 Talbert Avenue, Fountain Valley, California 92708
(Address of principal executive offices) (zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
None
Securities to be registered pursuant to Section 12(g) of the Act:
Series A Cumulative Convertible Preferred Stock
Series B Adjustable Rate Cumulative Preferred Stock
(Title of Class)
Item 1. Description of Registrant's Securities to be Registered
The description of the securities to be registered hereunder
by FHP International Corporation, a Delaware corporation (the
"Registrant") is set forth under the caption "Description of FHP
Capital Stock" in the Registrant's Registration Statement on
Form S-4 (Registration No. 33-53431), and in the Joint Proxy
Statement/Prospectus included therein and filed under the
Securities Act of 1933, as amended, and is hereby incorporated
herein by reference.
Item 2. Exhibits
Exhibit
Number
*3.1 Restated Certificate of Incorporation of FHP
International Corporation, effective November 19, 1992
(Exhibit 3.1 to Annual Report on Form 10-K filed for
the fiscal year ended June 30, 1993).
*3.2 Bylaws of FHP International Corporation (Exhibit 3.1 to
Quarterly Report on Form 10-Q filed for the quarterly
period ended September 30, 1993).
*3.3 Amended Form of Section IV to FHP Certificate of
Incorporation (Exhibit F to Joint Proxy Statement
included in Registration Statement on Form S-4,
Registration No. 33-53431).
*4.1 Indenture dated as of September 22, 1993, between the
Registrant and The Chase Manhattan Bank, N.A., in
regard to $100,000,000 7% Senior Notes due 2003
(Exhibit 4.2 to Registration Statement on Form S-3,
Registration No. 33-66252).
*4.2 Form of Certificate of Designation of Powers,
Preferences and Rights of Series A Cumulative
Convertible Preferred Stock of FHP International
Corporation (Exhibit B to Joint Proxy Statement
included in Form S-4, Registration No. 33-53431).
*4.3 Form of Certificate of Designation of Powers,
Preferences and Rights of Series B Adjustable Rate
Cumulative Preferred Stock of FHP International
Corporation (Exhibit C to Joint Proxy Statement
included in Form S-4, Registration No. 33-53431).
*4.4 Amended and Restated Rights Agreement, dated as of
March 28, 1994 (Exhibit 1 to Registration Statement
on Form 8-A/A dated as of March 31, 1994).
10.1 Credit Agreement dated as of March 24, 1994, among
Registrant, the lenders named therein and Chemical Bank
as Administrative Agent.
___________________________________________
* Document previously was filed with the Commission and is
incorporated by reference and made a part hereof.
SIGNATURE
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the registrant has duly caused
this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
Dated: May 9, 1994
FHP INTERNATIONAL CORPORATION
By: /s/KENNETH S. ORD
Name: Kenneth S. Ord
Title: Senior Vice President
and
Chief Financial Officer
CREDIT AGREEMENT, dated as of March 24, 1994, among FHP
INTERNATIONAL CORPORATION, a Delaware corporation (the
"Borrower"), the several banks and other financial institutions
from time to time parties to this Agreement (the "Lenders"),
CHEMICAL BANK, a New York banking corporation, as agent for the
Lenders hereunder (in such capacity, the "Administrative Agent")
and as CAF Loan Agent (in such capacity, the "CAF Loan Agent"),
and CHEMICAL SECURITIES INC., as arranger (in such capacity, the
"Arranger").
W I T N E S S E T H :
WHEREAS, TakeCare, Inc., a Delaware corporation
("TakeCare"), the Borrower and FHP Sub, Inc., a Delaware
corporation and a wholly-owned Subsidiary of the Borrower
("Merger Sub"), are parties to an Agreement and Plan of Merger
dated as of March 3, 1994 (as amended, modified or supplemented
from time to time in accordance with the terms thereof and
hereof, the "Merger Agreement"), pursuant to which TakeCare will
be merged with and into Merger Sub (the "Merger"), whereupon the
separate existence of TakeCare shall cease and Merger Sub shall
continue as the surviving corporation having the name "TakeCare,
Inc.";
WHEREAS, the Borrower has requested that the Lenders
make loans to the Borrower in an aggregate principal amount of up
to $350,000,000 to finance a portion of the Merger Consideration
(as hereinafter defined); and
WHEREAS, the Lenders are willing to make the requested
loans on the terms and subject to the conditions set forth
herein;
NOW, THEREFORE, for good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, the
parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. As used in this Agreement, the
following terms shall have the following meanings:
"ABR": for any day, a rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the Base CD
Rate in effect on such day plus 1% and (c) the Federal Funds
Effective Rate in effect on such day plus 1/2 of 1%. For
purposes hereof: "Prime Rate" shall mean the rate of
interest per annum publicly announced from time to time by
Chemical as its prime rate in effect at its principal office
in New York City (the Prime Rate not being intended to be
the lowest rate of interest charged by Chemical in
connection with extensions of credit to debtors); "Base CD
Rate" shall mean the sum of (a) the product of (i) the
Three-Month Secondary CD Rate and (ii) a fraction, the
numerator of which is one and the denominator of which is
one minus the C/D Reserve Percentage and (b) the C/D
Assessment Rate; "Three-Month Secondary CD Rate" shall mean,
for any day, the secondary market rate for three-month
certificates of deposit reported as being in effect on such
day (or, if such day shall not be a Business Day, the next
preceding Business Day) by the Board through the public
information telephone line of the Federal Reserve Bank of
New York (which rate will, under the current practices of
the Board, be published in Federal Reserve Statistical
Release H.15(519) during the week following such day), or,
if such rate shall not be so reported on such day or such
next preceding Business Day, the average of the secondary
market quotations for three-month certificates of deposit of
major money center banks in New York City received at
approximately 10:00 A.M., New York City time, on such day
(or, if such day shall not be a Business Day, on the next
preceding Business Day) by the Administrative Agent from
three New York City negotiable certificate of deposit
dealers of recognized standing selected by it; and "Federal
Funds Effective Rate" shall mean, for any day, the weighted
average of the rates on overnight federal funds transactions
with members of the Federal Reserve System arranged by
federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a
Business Day, the average of the quotations for the day of
such transactions received by the Administrative Agent from
three federal funds brokers of recognized standing selected
by it. Any change in the ABR due to a change in the Prime
Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate shall be effective as of the opening of
business on the effective day of such change in the Prime
Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate, respectively.
"ABR Loans": Term Loans and Revolving Credit Loans the
rate of interest applicable to which is based upon the ABR.
"Affiliate": as to any Person, any other Person (other
than a Subsidiary) which, directly or indirectly, is in
control of, is controlled by, or is under common control
with, such Person. For purposes of this definition,
"control" of a Person means the power, directly or
indirectly, either to (a) vote 5% or more of the securities
having ordinary voting power for the election of directors
of such Person or (b) direct or cause the direction of the
management and policies of such Person, whether by contract
or otherwise.
"Agreement": this Credit Agreement, as amended,
supplemented or otherwise modified from time to time.
"Applicable LIBOR Auction Advance Rate": in respect of
any CAF Loan requested pursuant to a LIBOR Auction Advance
Request, the London interbank offered rate for deposits in
Dollars for the period commencing on the date of such CAF
Loan and ending on the maturity date thereof which appears
on Telerate Page 3750 as of 11:00 A.M., London time, two
Working Days prior to the beginning of such period.
"Applicable Margin": for any day (a) for each ABR
Loan, 0% and (b) for each Revolving Credit Loan and Term
Loan that is a Eurodollar Loan, the rate per annum set forth
under the relevant column heading below for the higher of
the S&P Rating and the Moody's Rating in effect on such day:
Higher of S&P Rating
or Moody's Rating
Revolving
S&P Rating Moody's Rating Credit Loans Term Loans
Any rating of Any rating of Baa1 .325 of 1% .500 of 1%
BBB+ or higher or higher
Any rating below Any rating below .375 of 1% .600 of 1%
BBB+ but at or Baa1 but at or
above BBB- above Baa3
Any rating at or Any rating at or .550 of 1% .875 of 1%
below BB+ or below Ba1 or
unrated unrated
; provided, however, that if (i) on any day the S&P Rating
and the Moody's Rating are not at the same level, and the
lower of such Ratings is one level lower than the higher of
such Ratings, then the Applicable Margin for Eurodollar
Loans shall be that applicable to the higher of such
Ratings, and (ii) on any day the S&P Rating and Moody's
Rating are not at the same level, and the lower of such
Ratings is more than one level lower than the higher of such
Ratings, then the Applicable Margin for Eurodollar Loans
shall be that applicable to the Rating next higher from that
of the lower of such Ratings.
"Asset Sale": any sale or other disposition or series
of related sales or other dispositions by the Borrower or
any of its Subsidiaries of any asset or assets of the
Borrower or such Subsidiary (other than (i) any sale or
other disposition of inventory in the ordinary course of
business, (ii) any sale or other disposition or series of
related sales or other disposition of assets with an
aggregate Fair Market Value not exceeding $100,000 or (iii)
any sale or other disposition of obsolete or worn-out
property).
"Assignee": as defined in subsection 9.6(c).
"Average Life": as of any date, with respect to any
debt security or other indebtedness, the quotient obtained
by dividing (i) the sum of the products of (x) the number of
years from such date to the date of each scheduled principal
payment (including any sinking fund or mandatory redemption
payment requirements) of such debt security or other
indebtedness multiplied in each case by (y) the amount of
such principal payment by (ii) the sum of all such principal
payments.
"Board": the Board of Governors of the Federal Reserve
System, or any successor.
"Borrower Properties": as defined in subsection 3.18.
"Borrowing Date": any Business Day specified in a
notice pursuant to subsection 2.1, 2.2 or 2.3 as a date on
which the Borrower requests the Lenders to make Loans
hereunder.
"Business": as defined in subsection 3.18.
"Business Day": a day other than a Saturday, Sunday or
other day on which commercial banks in New York City or Los
Angeles are authorized or required by law to close.
"CAF Availability": at any time, an amount equal to
the excess, if any, of (a) the aggregate amount of the
Revolving Credit Commitments over (b) the sum of the then
outstanding aggregate principal amount of Revolving Credit
Loans and the then outstanding aggregate principal amount of
CAF Loans.
"CAF Loan": each CAF Loan made pursuant to subsection
2.3.
"CAF Loan Confirmation": each confirmation by the
Borrower of its acceptance of one or more CAF Loan Offers,
which CAF Loan Confirmation shall be substantially in the
form of Exhibit F and shall be delivered to the CAF Loan
Agent in writing or by facsimile transmission.
"CAF Loan Date": each date on which a CAF Loan is made
pursuant to subsection 2.3.
"CAF Loan Note": as defined in subsection 2.3(f).
"CAF Loan Offer": each offer by a Lender to make one
or more CAF Loans pursuant to a CAF Loan Request, which CAF
Loan Offer shall contain the information specified in
Exhibit E and shall be delivered to the CAF Loan Agent by
telephone, immediately confirmed by facsimile transmission.
"CAF Loan Request": each request by the Borrower for
Lenders to submit bids to make CAF Loans, which shall
contain the information in respect of such requested CAF
Loans specified in Exhibit D and shall be delivered to the
CAF Loan Agent in writing or by facsimile transmission, or
by telephone, immediately confirmed by facsimile
transmission.
"Capital Stock": any and all shares, interests,
participations or other equivalents (however designated) of
capital stock of a corporation, any and all equivalent
ownership interests in a Person (other than a corporation)
and any and all warrants or options to purchase any of the
foregoing.
"Cash Collateralized": in respect of any CAF Loan Note
and any CAF Loan outstanding thereunder, such CAF Loan Note
and CAF Loan shall be deemed Cash Collateralized if (i)
immediately available funds, in an amount equal to the
principal amount of such CAF Loan, plus all then accrued and
unpaid interest thereon and all interest to accrue thereon
to the maturity date thereof (or U.S. Government securities
or other securities acceptable to the Lender to which such
CAF Loan is owed in an amount which, together with interest
to accrue thereon, will be at least equal in value to such
cash amount on the maturity date of such CAF Loan) shall
have been deposited in a cash collateral account with the
Lender to which such CAF Loan is owed under documentation
and other arrangements satisfactory to such Lender and (ii)
except in the case of any CAF Loan being Cash Collateralized
pursuant to subsection 2.6(c), all Commitments shall have
been terminated and all Revolving Credit Loans and Term
Loans and other CAF Loans (except for other CAF Loans that
have been Cash Collateralized) shall have been repaid in
full.
"C/D Assessment Rate": for any day as applied to any
ABR Loan, the annual assessment rate in effect on such day
which is payable by a member of the Bank Insurance Fund
maintained by the Federal Deposit Insurance Corporation (the
"FDIC") classified as well-capitalized and within
supervisory subgroup "B" (or a comparable successor
assessment risk classification) within the meaning of 12
C.F.R. Section 327.3(d) (or any successor provision) to the FDIC
(or any successor) for the FDIC's (or such successor's)
insuring time deposits at offices of such institution in the
United States.
"C/D Reserve Percentage": for any day as applied to
any ABR Loan, that percentage (expressed as a decimal) which
is in effect on such day, as prescribed by the Board, for
determining the maximum reserve requirement for a Depositary
Institution (as defined in Regulation D of the Board) in
respect of new non-personal time deposits in Dollars having
a maturity of 30 days or more.
"Chemical": Chemical Bank, a New York banking
corporation.
"Closing Date": the date on or before November 1, 1994
on which the initial Loans are made.
"Code": the Internal Revenue Code of 1986, as amended
from time to time.
"Commitments: the collective reference to the
Revolving Credit Commitments and the Term Loan Commitments.
"Commonly Controlled Entity": an entity, whether or
not incorporated, which is under common control with the
Borrower within the meaning of Section 4001 of ERISA or is
part of a group which includes the Borrower and which is
treated as a single employer under Section 414 of the Code.
"Consolidated Adjusted Fixed Charges": for any period,
the sum of (i) the amount of interest expense and rental
expense deducted from earnings of the Borrower and its
consolidated Subsidiaries in determining Consolidated Net
Income for such period, plus (ii) the amount of dividends
paid by the Borrower during such period on Preferred Stock.
"Consolidated Adjusted Net Income": for any period,
the Consolidated Net Income of the Borrower and its
consolidated Subsidiaries for such period, plus the amount
of income taxes, interest expense, rental expense,
depreciation and amortization, deducted from earnings of the
Borrower and its consolidated Subsidiaries for such period
in determining such Consolidated Net Income.
"Consolidated Capital Funds": at any date, the sum of
(i) shareholders' equity of the Borrower and its
consolidated Subsidiaries, determined on a consolidated
basis in accordance with GAAP, including all Preferred Stock
of the Borrower (other than, prior to December 31, 1994
only, the Non-Convertible Merger Preferred Stock) and (ii)
Consolidated Total Debt.
"Consolidated Net Income": of any Person for any
period, the net income, if any, of such Person and its
consolidated Subsidiaries for such period, determined in
accordance with GAAP.
"Consolidated Net Tangible Assets": at any date, the
total amount of assets of the Borrower and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP,
after deducting therefrom, without duplication (i) all
current liabilities (excluding any thereof which are by
their terms extendable or renewable at the option of the
obligor thereon to a time more than 12 months after the time
as of which the amount thereof is being computed and
excluding any deferred income taxes that are included in
current liabilities), (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense
and other like intangible assets, and (iii) applicable
reserves (other than long-term reserves), prepaid expenses,
intercompany items, deferred charges and unamortized debt
discount, determined on a consolidated basis in accordance
with GAAP.
"Consolidated Net Worth": at any date, shareholders'
equity of the Borrower and its consolidated Subsidiaries,
determined in accordance with GAAP; provided, that (i) prior
to December 31, 1994, Consolidated Net Worth shall include
the Convertible Merger Preferred Stock and exclude the Non-
Convertible Merger Preferred Stock and (ii) from and after
December 31, 1994, Consolidated Net Worth shall include all
outstanding Merger Preferred Stock.
"Consolidated Total Debt": at any date, without
duplication, the aggregate of all Indebtedness (including
the current portion thereof) and Guarantee Obligations of
the Borrower and its consolidated Subsidiaries, determined
on a consolidated basis in accordance with GAAP, plus, prior
to December 31, 1994 only, the aggregate stated value of all
Non-Convertible Merger Preferred Stock then outstanding.
"Contractual Obligation": as to any Person, any
provision of any security issued by such Person or of any
material agreement, instrument or other undertaking to which
such Person is a party or by which it or any of its property
is bound.
"Convertible Merger Preferred Stock": the Series A
Cumulative Convertible Preferred Stock, $0.05 par value, of
the Borrower, having the terms and conditions described in
the Merger Agreement, to be issued at the time of the Merger
as a part of the Merger Consideration.
"Cumulative Consolidated Net Income": for the period
commencing on January 1, 1994 and ending on any date of
determination, the sum of Consolidated Net Income for each
fiscal quarter of the Borrower and its consolidated
Subsidiaries ending after January 1, 1994 and ending on or
prior to such date of determination in which such
Consolidated Net Income is greater than zero.
"Default": any of the events specified in Section 7,
whether or not any requirement for the giving of notice, the
lapse of time, or both, or any other condition, has been
satisfied.
"Dollars" and "$": dollars in lawful currency of the
United States of America.
"Environmental Laws": any and all foreign, Federal,
state, local or municipal laws, rules, orders, regulations,
statutes, ordinances, codes, decrees, requirements of any
Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of
human health or the environment, as now or may at any time
hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act
of 1974, as amended from time to time.
"Eurodollar Loans": Term Loans and Revolving Credit
Loans the rate of interest applicable to which is based upon
the Eurodollar Rate.
"Eurodollar Rate": with respect to each day during
each Interest Period pertaining to a Eurodollar Loan, the
rate per annum equal to the average (rounded upward to the
nearest 1/16th of 1%) of the respective rates notified to
the Administrative Agent by each of the Reference Lenders as
the rate at which such Reference Lender is offered Dollar
deposits (i.e., deposits to be deposited with such Reference
Lender) at or about 10:00 A.M., New York City time, two
Business Days prior to the first day of such Interest Period
in the interbank eurodollar market where the eurodollar and
foreign currency and exchange operations in respect of its
Eurodollar Loans are then generally being conducted for
delivery on the first day of such Interest Period for the
number of days comprised therein in immediately available
funds on such first day and in an amount comparable to the
amount of the Eurodollar Loan for which the Eurodollar Rate
is then being determined.
"Event of Default": any of the events specified in
Section 7, provided that any requirement for the giving of
notice, the lapse of time, or both, or any other condition,
has been satisfied.
"Existing TakeCare Indebtedness": the Indebtedness of
TakeCare, which is to be repaid on the Closing Date, as set
forth in Schedule III.
"Exposure": as to any Lender at any time, the
aggregate at such time of (i) such Lender's undrawn Term
Loan Commitment and undrawn Revolving Credit Commitment
(calculated with the assumption that there are no CAF Loans
outstanding at such time) and (ii) the outstanding principal
amount of Term Loans and Revolving Credit Loans made by such
Lender, and, from and after the date of termination of the
Commitments, the outstanding principal amount of CAF Loans
made by such Lender.
"Fair Market Value": with respect to the total
consideration received pursuant to any Asset Sale or any
non-cash consideration received by any Person, the fair
market value of such consideration as determined in good
faith by such Person's board of directors.
"Financing Lease": any lease of property, real or
personal, the obligations of the lessee in respect of which
are required in accordance with GAAP to be capitalized on a
balance sheet of the lessee.
"Fixed Rate Auction Advance Request": any CAF Loan
Request requesting the Lenders to offer to make CAF Loans at
a fixed rate (as opposed to a rate composed of the
Applicable LIBOR Auction Advance Rate plus or minus a
margin).
"GAAP": generally accepted accounting principles in
the United States of America in effect from time to time.
"Governmental Authority": any nation or government,
any state or other political subdivision thereof and any
entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government.
"Guarantee Obligation": any direct or indirect
obligation, contingent or otherwise, of a Person (a
"guaranteeing person") guaranteeing or having the economic
effect of guaranteeing any Indebtedness of any other Person
in any manner. The amount of any Guarantee Obligation of
any guaranteeing person shall be deemed to be the lower of
(a) an amount equal to the stated or determinable amount of
the primary obligation in respect of which such Guarantee
Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of
the instrument embodying such Guarantee Obligation, unless
such primary obligation and the maximum amount for which
such guaranteeing person may be liable are not stated or
determinable, in which case the amount of such Guarantee
Obligation shall be such guaranteeing person's maximum
reasonably anticipated liability in respect thereof as
determined by the Borrower in good faith.
"HMO": a health maintenance organization doing
business as such (or required to qualify or to be licensed
as such) under HMO Regulations.
"HMO Regulation": all material laws, regulations,
directives and administrative orders applicable under
federal or state law to health maintenance organizations and
any regulations, orders and directives promulgated or issued
by any Governmental Authority pursuant thereto.
"HMO Regulator": any Governmental Authority charged
with the administration, oversight or enforcement of an HMO
Regulation.
"HMO Subsidiary": any Subsidiary of the Borrower that
is now or hereafter an HMO.
"Indebtedness": of any Person at any date, (a) all
indebtedness of such Person for borrowed money or for the
deferred purchase price of property or services (other than
current trade liabilities incurred in the ordinary course of
business and payable in accordance with customary
practices), (b) any other indebtedness of such Person which
is evidenced by a note, bond, debenture or similar
instrument, (c) that portion of obligations of such Person
under Financing Leases (under which such Person is a lessee)
that is properly classified as a liability on a balance
sheet prepared in conformity with GAAP, (d) all obligations
of such Person in respect of letters of credit and
acceptances issued or created for the account of such Person
and (e) all liabilities secured by any Lien on any property
owned by such Person even though such Person has not assumed
or otherwise become liable for the payment thereof.
"Insolvency": with respect to any Multiemployer Plan,
the condition that such Plan is insolvent within the meaning
of Section 4245 of ERISA.
"Insolvent": pertaining to a condition of Insolvency.
"Insurance Regulation": any material law, regulation,
rule, directive or order of a Governmental Authority
applicable to an insurance company.
"Insurance Regulator": any Governmental Authority
charged with the administration, oversight or enforcement of
any Insurance Regulation.
"Insurance Subsidiary": any Subsidiary of the Borrower
that is now or hereafter doing business (or required to
qualify or to be licensed as an insurance company) under
Insurance Regulations.
"Interest Payment Date": (a) as to any ABR Loan, the
last day of each March, June, September and December to
occur while such Loan is outstanding, (b) as to any
Eurodollar Loan having an Interest Period of three months or
less, the last day of such Interest Period, and (c) as to
any Eurodollar Loan having an Interest Period longer than
three months, the last day of each March, June, September
and December to occur during such Interest Period and the
last day of such Interest Period.
"Interest Period": with respect to any Eurodollar
Loan:
(i) initially, the period commencing on the
borrowing or conversion date, as the case may be, with
respect to such Eurodollar Loan and ending one, two,
three or six months thereafter, as selected by the
Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect
thereto; and
(ii) thereafter, each period commencing on the
last day of the next preceding Interest Period
applicable to such Eurodollar Loan and ending one, two,
three or six months thereafter, as selected by the
Borrower by irrevocable notice to the Administrative
Agent not less than three Business Days prior to the
last day of the then current Interest Period with
respect thereto;
provided that, all of the foregoing provisions relating to
Interest Periods are subject to the following:
(1) if any Interest Period pertaining to a
Eurodollar Loan would otherwise end on a day that is
not a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless the
result of such extension would be to carry such
Interest Period into another calendar month in which
event such Interest Period shall end on the immediately
preceding Business Day;
(2) any Interest Period pertaining to a Revolving
Credit Loan that would otherwise extend beyond the
Revolving Credit Termination Date shall end on the
Revolving Credit Termination Date;
(3) any Interest Period pertaining to a Term Loan
that would otherwise extend beyond the date final
payment is due on the Term Loans shall end on such date
of final payment;
(4) any Interest Period pertaining to a
Eurodollar Loan that begins on the last Business Day of
a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(5) the Borrower shall select Interest Periods so
as not to require a payment or prepayment of any
Eurodollar Loan during an Interest Period for such
Loan.
"LIBOR Auction Advance Request": any CAF Loan Request
requesting the Lenders to offer to make CAF Loans at an
interest rate equal to the Applicable LIBOR Auction Advance
Rate plus or minus a margin.
"Lien": any mortgage, pledge, hypothecation,
assignment (to the extent such assignment is intended to
secure an obligation of any Person), encumbrance, lien
(statutory or other), charge or other security interest or
any preference, priority or other security agreement or, if
they have the same economic effect as any of the foregoing,
any preferential arrangement of any kind or nature
whatsoever (including, without limitation, any conditional
sale or other title retention agreement and any Financing
Lease).
"Loan": any Revolving Credit Loan, Term Loan or CAF
Loan made by any Lender pursuant to this Agreement.
"Loan Documents": this Agreement and the Notes.
"Material Adverse Effect": a material adverse effect
on (a) the business, operations, property or financial
condition of the Borrower and its Subsidiaries taken as a
whole or (b) the validity or enforceability of this
Agreement or any of the other Loan Documents or the rights
or remedies of the Administrative Agent or the Lenders
hereunder or thereunder.
"Materials of Environmental Concern": any gasoline or
petroleum (including crude oil or any fraction thereof) or
petroleum products or any hazardous or toxic substances,
materials or wastes, defined or regulated as such in or
under any Environmental Law, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde
insulation.
"Material Subsidiary": at any time, each Subsidiary
that (i) for the most recent fiscal year of the Borrower,
accounted for more than $25,000,000 of the consolidated
revenues of the Borrower and its consolidated Subsidiaries
or (ii) as at the end of such fiscal year, was the owner,
directly or indirectly, of more than $25,000,000 in
aggregate book value of the consolidated assets of the
Borrower and its consolidated Subsidiaries, all as shown on
the Borrower's consolidated financial statements for such
fiscal year prepared in accordance with GAAP, provided that
clause (i) shall be determined on a pro forma basis in the
case of a Subsidiary acquired during or subsequent to the
end of such fiscal year, giving effect to such acquisition
as if it occurred on the first day of such year, and clause
(ii) shall be determined on a pro forma basis in the case of
a Subsidiary acquired subsequent to the end of such fiscal
year, giving effect to such acquisition as if it occurred at
the end of such fiscal year.
"Merger": as defined in the recitals hereto.
"Merger Agreement": as defined in the recitals hereto.
"Merger Consideration": as defined in the Merger
Agreement.
"Merger Documents": collectively, the Merger
Agreement, the certificate of merger to be filed by Merger
Sub with the Secretary of State of Delaware in accordance
with Delaware law to effect the Merger and all agreements
executed and/or delivered in connection therewith.
"Merger Preferred Stock": the collective reference to
the Convertible Merger Preferred Stock and the Non-
Convertible Merger Preferred Stock.
"Merger Sub": as defined in the recitals hereto.
"Moody's Rating": for any day, the rating of the
Borrower's unsecured, non-credit enhanced, long-term senior
indebtedness by Moody's Investor Service, Inc. in effect at
9:00 A.M., New York City time, on such day.
"Multiemployer Plan": a Plan which is a multiemployer
plan as defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds": in connection with any Asset
Sale, the cash proceeds (including any cash payments
received by way of deferred payment of principal pursuant to
a note or installment receivable or purchase price
adjustment receivable or otherwise, but only as and when
received) actually received from such Asset Sale, net of
reasonable attorneys' fees, accountants' fees, investment
banking fees, brokerage commissions, amounts required to be
applied to the repayment of Indebtedness secured by a Lien
not prohibited hereunder on any asset which is the subject
of such sale and other customary fees, expenses and
commissions actually incurred in connection therewith and
net of taxes paid or reasonably estimated to be payable as a
result thereof (after taking into account any available tax
credits or deductions and any tax sharing arrangements).
"Non-Convertible Merger Preferred Stock": the Series B
Adjustable Rate Cumulative Preferred Stock, $0.05 par value,
of the Borrower, having the terms and conditions described
in the Merger Agreement, which may be issued at the time of
the Merger as a part of the Merger Consideration and in lieu
of the Cash Merger Consideration (as defined in the Merger
Agreement).
"Non-Excluded Taxes": as defined in subsection 2.15.
"Notes": the collective reference to the Revolving
Credit Notes, the Term Notes and the CAF Loan Notes.
"Participant": as defined in subsection 9.6(b).
"PBGC": the Pension Benefit Guaranty Corporation
established pursuant to Subtitle A of Title IV of ERISA.
"Permitted Ordinary Course Liens": (a) landlords',
carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary
course of business which are not overdue for a period of
more than 60 days or which are being contested in good faith
by appropriate proceedings; (b) pledges or deposits in
connection with workers' compensation, unemployment
insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or
self-insurance arrangements; (c) deposits to secure the
performance of bids, trade contracts (other than for
borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a
like nature incurred in the ordinary course of business; (d)
easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business
which, in the aggregate, do not materially detract from the
value of the property subject thereto or materially
interfere with the ordinary conduct of the business of the
Person whose property is encumbered thereby, (e) leases or
subleases granted through others not interfering in any
material respect with the ordinary conduct of the business
of the Borrower or any of its Subsidiaries, (f) any interest
or title of a lessor or sublessor under any lease, (g) Liens
arising from filing UCC financing statements relating solely
to leases not prohibited by this Agreement and (h) tax liens
securing taxes that are immaterial in amount.
"Permitted Subsidiary Refinancing Indebtedness":
Indebtedness or Guarantee Obligations of any Subsidiary of
the Borrower, the proceeds of which are used to renew,
extend, refinance or refund outstanding Indebtedness or
Guarantee Obligations of such Subsidiary, provided that (i)
such Indebtedness or Guarantee Obligation is scheduled to
mature no earlier than the Indebtedness or Guarantee
Obligations being renewed, extended, refinanced or refunded
and (ii) such Indebtedness or Guarantee Obligations has an
Average Life at the time such Indebtedness or Guarantee
Obligation is incurred that is not less than the Average
Life of the Indebtedness or Guarantee Obligations being
renewed, extended, refinanced or refunded; provided,
further, that such Indebtedness or Guarantee Obligations
shall be Permitted Subsidiary Refinancing Indebtedness only
to the extent that the aggregate principal amount of such
Indebtedness or Guarantee Obligations (or, if such
Indebtedness or Guarantee Obligation is issued at a price
less than the principal amount thereof, the aggregate amount
of gross proceeds therefrom) does not exceed the aggregate
principal amount then outstanding under the Indebtedness or
Guarantee Obligations being renewed, extended, refinanced or
refunded (or if the Indebtedness or Guarantee Obligation
being renewed, extended, refinanced or refunded was issued
at a price less than the principal amount thereof, then not
in excess of the amount of liability in respect thereof
determined in accordance with GAAP).
"Person": an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other
entity of whatever nature.
"Plan": at a particular time, any employee benefit
plan which is covered by ERISA and in respect of which the
Borrower or a Commonly Controlled Entity is (or, if such
plan were terminated at such time, would under Section 4069
of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Preferred Stock": any preferred stock issued by the
Borrower, including the Merger Preferred Stock.
"Property": with respect to any Person, any interest
of such Person in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible,
including, without limitation, Capital Stock in any other
Person.
"Rating": the Moody's Rating or the S&P Rating;
collectively, the "Ratings".
"Reference Lenders": Chemical, Bank of America
National Trust and Savings Association and Citicorp USA,
Inc.
"Register": as defined in subsection 9.6(d).
"Related Transactions": the Merger, the execution and
delivery of the Loan Documents and any other documents
executed in connection therewith, the funding of the Loans
on the Closing Date, the repayment of the Existing TakeCare
Indebtedness, the issuance of the Borrower's common stock
and the Merger Preferred Stock as a portion of the Merger
Consideration, the payment of the Cash Merger Consideration
and the payment of all fees, costs and expenses associated
with all of the foregoing.
"Reorganization": with respect to any Multiemployer
Plan, the condition that such plan is in reorganization
within the meaning of Section 4241 of ERISA.
"Reportable Event": any of the events set forth in
Section 4043(b) of ERISA, other than those events as to
which the thirty day notice period is waived under
subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg.
Section 2615.
"Required Lenders": at any time, Lenders whose
Exposure comprises at least 51% of the Exposure of all the
Lenders.
"Requirement of Law": as to any Person, any material
law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any
of its property or to which such Person or any of its
property is subject.
"Responsible Officer": the chief executive officer,
the president, any executive vice president, any senior vice
president, chief financial officer, vice president-
treasurer, vice president-accounting or controller of the
Borrower or, with respect to financial matters, the chief
financial officer, vice president-treasurer, vice president-
accounting or controller of the Borrower.
"Revolving Credit Commitment": as to any Lender, the
obligation of such Lender to make Revolving Credit Loans to
the Borrower hereunder in an aggregate principal amount at
any one time outstanding not to exceed the amount set forth
opposite such Lender's name under the heading "Revolving
Credit Commitment" initially on the signature pages of the
Agreement and thereafter on Schedule I as provided in
subsection 9.15, as such amount may be changed from time to
time in accordance with the provisions of this Agreement.
"Revolving Credit Commitment Percentage": as to any
Lender at any time, the percentage which such Lender's
Revolving Credit Commitment then constitutes of the
aggregate Revolving Credit Commitments.
"Revolving Credit Commitment Period": the period from
and including the Closing Date to but not including the
Revolving Credit Termination Date or such earlier date on
which the Revolving Credit Commitments shall terminate as
provided herein.
"Revolving Credit Loans": as defined in subsection
2.1.
"Revolving Credit Note": as defined in subsection 2.1.
"Revolving Credit Termination Date": the date which is
the fifth anniversary of the Closing Date, or such earlier
date as is specified by the Borrower pursuant to subsection
2.5.
"Sale and Lease-Back Transaction": with respect to any
Person, any direct or indirect arrangement pursuant to which
Property is sold or transferred by such Person or a
subsidiary of such Person and is thereafter leased back from
the purchaser or transferee thereof by such Person or one of
its subsidiaries (regardless of whether such lease is
entered into at the time of such sale or transfer).
"S&P Rating": for any day, the rating of the
Borrower's unsecured, non-credit enhanced, long-term senior
indebtedness by Standard & Poor's Corporation in effect at
9:00 A.M., New York City time, on such day.
"Single Employer Plan": any Plan which is covered by
Title IV of ERISA, but which is not a Multiemployer Plan.
"Subsidiary": as to any Person, a corporation,
partnership or other entity of which shares of stock or
other ownership interests having ordinary voting power
(other than stock or such other ownership interests having
such power only by reason of the happening of a contingency)
to elect a majority of the board of directors or other
managers of such corporation, partnership or other entity
are at the time owned, or the management of which is
otherwise controlled, directly or indirectly through one or
more intermediaries, or both, by such Person. Unless
otherwise qualified, all references to a "Subsidiary" or to
"Subsidiaries" in this Agreement shall refer to a Subsidiary
or Subsidiaries of the Borrower.
"Term Loan": as defined in subsection 2.2.
"Term Loan Commitment": as to any Lender, the
obligation of such Lender to make one or more Term Loans to
the Borrower hereunder in an aggregate principal amount not
to exceed the amount set forth opposite such Lender's name
under the heading "Term Loan Commitment" initially on the
signature pages of this Agreement and thereafter on Schedule
I as provided in subsection 9.15, as such amount may be
changed from time to time in accordance with provisions of
this Agreement.
"Term Loan Commitment Percentage": as to any Lender at
any time, the percentage which such Lender's Term Loan
Commitment then constitutes of the aggregate Term Loan
Commitments.
"Term Loan Commitment Period": the period from and
including the Closing Date to and including the Term Loan
Commitment Termination Date or such earlier date on which
the Term Loan Commitment shall terminate as provided herein.
"Term Loan Commitment Termination Date": December 31,
1994.
"Term Note": as defined in subsection 2.2.
"Tranche": the collective reference to all Eurodollar
Loans with respect to which the then current Interest
Periods begin on the same date and end on the same later
date (whether or not such Loans shall originally have been
made on the same day).
"Transferee": as defined in subsection 9.6(f).
"Type": as to any Term Loan or Revolving Credit Loan,
its nature as an ABR Loan or a Eurodollar Loan.
"Value": with respect to a Sale and Lease-Back
Transaction, as of any particular time, the amount equal to
the greater of (i) the net proceeds of the sale or transfer
of the Property leased pursuant to such Sale and Lease-Back
Transaction or (ii) the Fair Market Value of such Property
at the time of entering into such Sale and Lease-Back
Transaction, in either case, divided first by the number of
full years of the term of the lease and then multiplied by
the number of full years of such term remaining at the time
of determination, without regard to any renewal or extension
options contained in the lease.
"Working Day": any Business Day on which dealings in
foreign currencies and exchange between banks may be carried
on in London, England.
1.2 Other Definitional Provisions. (a) Unless
otherwise specified therein, all terms defined in this Agreement
shall have the defined meanings when used in the Notes or any
certificate or other document made or delivered pursuant hereto.
(b) As used herein and in the Notes, and any
certificate or other document made or delivered pursuant hereto,
accounting terms relating to the Borrower and its Subsidiaries
not defined in subsection 1.1 and accounting terms partly defined
in subsection 1.1, to the extent not fully defined, shall have
the respective meanings given to them under GAAP. If any changes
in accounting principles from those used in the preparation of
the financial statements referred to in subsection 3.1(a) are
hereafter occasioned by promulgation of rules, regulations,
pronouncements or opinions by or are otherwise required by the
Financial Accounting Standards Board or the American Institute of
Certified Public Accountants (or successors thereto or agencies
with similar functions), and any of such changes results in a
change in the method of calculation of, or affects the results of
such calculation of, any of the financial covenants, standards or
terms found herein, then the parties hereto agree to enter into
and diligently pursue negotiations in order to amend such
financial covenants, standards or terms so as to equitably
reflect such changes, with the desired result that the criteria
for evaluating the Borrower's financial condition and results of
operations shall be the same after such changes as if such
changes had not been made.
(c) Accounting terms in this Agreement relating to the
consolidated financial statements of the Borrower and its
Subsidiaries shall not be deemed to include amounts for TakeCare
and its Subsidiaries prior to the consummation of the Merger.
(d) The words "hereof", "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer
to this Agreement as a whole and not to any particular provision
of this Agreement, and Section, subsection, Schedule and Exhibit
references are to this Agreement unless otherwise specified.
(e) The meanings given to terms defined herein shall
be equally applicable to both the singular and plural forms of
such terms.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 Revolving Credit Commitments and Revolving Credit
Notes. (a) Subject to the terms and conditions hereof, each
Lender severally agrees to make revolving credit loans
("Revolving Credit Loans") to the Borrower from time to time from
the Closing Date to the Revolving Credit Termination Date in an
aggregate principal amount at any one time outstanding not to
exceed the amount of such Lender's Revolving Credit Commitment,
provided that the aggregate outstanding principal amount of
Revolving Credit Loans and CAF Loans of all Lenders shall not at
any time exceed the aggregate amount of the Revolving Credit
Commitments. During the period from the Closing Date to the
Revolving Credit Termination Date the Borrower may use the
Revolving Credit Commitments by borrowing, prepaying the
Revolving Credit Loans in whole or in part, and reborrowing, all
in accordance with the terms and conditions hereof.
(b) The Revolving Credit Loans may from time to time
be (i) Eurodollar Loans, (ii) ABR Loans or (iii) a combination
thereof, as determined by the Borrower and notified to the
Administrative Agent in accordance with subsections 2.1(d) and
2.7, provided that no Revolving Credit Loan shall be made as a
Eurodollar Loan after the day that is one month prior to the
Revolving Credit Termination Date.
(c) The Revolving Credit Loans made by each Lender
shall be evidenced by a promissory note of the Borrower,
substantially in the form of Exhibit A, with appropriate
insertions as to payee, date and principal amount (a "Revolving
Credit Note"), payable to the order of such Lender and in a
principal amount equal to the lesser of (a) the amount of the
initial Revolving Credit Commitment of such Lender and (b) the
aggregate unpaid principal amount of all Revolving Credit Loans
made by such Lender. Each Lender is hereby authorized to record
the date, Type and amount of each Revolving Credit Loan made by
such Lender, each continuation thereof, each conversion of all or
a portion thereof to another Type, the date and amount of each
payment or prepayment of principal thereof and, in the case of
Eurodollar Loans, the length of each Interest Period with respect
thereto, on the schedule annexed to and constituting a part of
its Revolving Credit Note, and any such recordation shall
constitute prima facie evidence of the accuracy of the
information so recorded. Each Revolving Credit Note shall (x) be
dated the Closing Date, (y) be stated to mature on the Revolving
Credit Termination Date and (z) provide for the payment of
interest in accordance with subsection 2.9.
(d) The Borrower may borrow under the Revolving Credit
Commitments on any Business Day from the Closing Date to the
Revolving Credit Termination Date, provided that the Borrower
shall give the Administrative Agent irrevocable telephone notice
(confirmed promptly on the same day in writing) (which notice
must be received by the Administrative Agent prior to (a) 12:00
Noon, New York City time, three Business Days prior to the
requested Borrowing Date, if all or any part of the requested
Revolving Credit Loans are to be initially Eurodollar Loans, or
(b) 1:00 P.M., New York City time, one Business Day prior to the
requested Borrowing Date, otherwise), specifying (i) the amount
to be borrowed, (ii) the requested Borrowing Date, (iii) whether
the borrowing is to be of Eurodollar Loans, ABR Loans, or a
combination thereof and (iv) if the borrowing is to be entirely
or partly of Eurodollar Loans, the respective amounts of each
such Type of Loan and the respective lengths of the initial
Interest Periods therefor. Each borrowing under the Revolving
Credit Commitments shall be in an amount equal to (x) in the case
of ABR Loans, $1,000,000 or a whole multiple thereof (or, if the
aggregate amount of the Revolving Credit Commitments of all
Lenders, minus the then aggregate outstanding principal amount of
Revolving Credit Loans and CAF Loans, is less than $1,000,000,
such lesser amount) and (y) in the case of Eurodollar Loans,
$5,000,000 or a whole multiple of $1,000,000 in excess thereof.
Upon receipt of any such notice from the Borrower, the
Administrative Agent shall promptly notify each Lender thereof.
Each Lender will make the amount of its pro rata share of each
borrowing available to the Administrative Agent for the account
of the Borrower at the office of the Administrative Agent
specified in subsection 9.2 prior to 11:00 A.M., New York City
time, on the Borrowing Date requested by the Borrower in funds
immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on
such Borrowing Date on the books of such office with the
aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the
Administrative Agent.
2.2 Term Loans and Term Notes. (a) Subject to the
terms and conditions hereof, each Lender severally agrees to make
term loans ("Term Loans") to the Borrower from time to time from
the Closing Date to and including the Term Loan Commitment
Termination Date in an aggregate principal amount at any one time
outstanding not to exceed the amount of such Lender's Term Loan
Commitment.
(b) The Term Loans may from time to time be (i)
Eurodollar Loans, (ii) ABR Loans or (iii) a combination thereof,
as determined by the Borrower and notified to the Administrative
Agent in accordance with subsections 2.2(d) and 2.7.
(c) The Term Loans made by each Lender shall be
evidenced by a promissory note of the Borrower, substantially in
the form of Exhibit B, with appropriate insertions as to payee,
date and principal amount (a "Term Note"), payable to the order
of such Lender and in a principal amount equal to the lesser of
(a) the amount of the initial Term Loan Commitment of such Lender
and (b) the aggregate unpaid principal amount of all Term Loans
made by such Lender. Each Lender is hereby authorized to record
the date, Type and amount of each Term Loan made by such Lender,
each continuation thereof, each conversion of all or a portion
thereof to another Type, the date and amount of each payment or
prepayment of principal thereof and, in the case of Eurodollar
Loans, the length of each Interest Period with respect thereto,
on the schedule annexed to and constituting a part of its Term
Note, and any such recordation shall constitute prima facie
evidence of the accuracy of the information so recorded. Each
Term Note shall (x) be dated the Closing Date, (y) mature in 10
equal consecutive semi-annual installments, each of which shall
be an amount equal to such Lender's Term Loan Commitment
Percentage of the lesser of (1) $25,000,000 and (2) one-tenth of
the aggregate amount of Term Loans made by all Lenders hereunder,
the first of which installments shall be payable on the later of
January 2, 1995 and the date which is six months after the
Closing Date, the next eight of which installments shall be
payable at semi-annual intervals following the first installment
and the final installment shall be payable on the fifth
anniversary of the Closing Date and (z) provide for the payment
of interest in accordance with subsection 2.9.
(d) The Borrower may borrow under the Term Loan
Commitments on any Business Day from the Closing Date to the Term
Loan Commitment Termination Date, provided that the Borrower
shall give the Administrative Agent irrevocable telephone notice
(confirmed promptly on the same day in writing) (which notice
must be received by the Administrative Agent prior to (a) 12:00
Noon, New York City time, three Business Days prior to the
requested Borrowing Date, if all or any part of the requested
Term Loans are to be initially Eurodollar Loans, or (b) 1:00
P.M., New York City time one Business Day prior to the requested
Borrowing Date, otherwise), specifying (i) the amount to be
borrowed, (ii) the requested Borrowing Date, (iii) whether the
borrowing is to be of Eurodollar Loans, ABR Loans, or a
combination thereof and (iv) if the borrowing is to be entirely
or partly of Eurodollar Loans, the respective amounts of each
such Type of Loan and the respective lengths of the initial
Interest Periods therefor. Each borrowing under the Term Loan
Commitments shall be in an amount equal to (x) in the case of ABR
Loans, $1,000,000 or a whole multiple thereof (or, if the
aggregate amount of the then undrawn amount of the Term Loan
Commitments of all Lenders is less than $1,000,000, such lesser
amount) and (y) in the case of Eurodollar Loans, $5,000,000 or a
whole multiple of $1,000,000 in excess thereof. Upon receipt of
any such notice from the Borrower, the Administrative Agent shall
promptly notify each Lender thereof. Each Lender will make the
amount of its pro rata share of each borrowing available to the
Administrative Agent for the account of the Borrower at the
office of the Administrative Agent specified in subsection 9.2
prior to 11:00 A.M., New York City time, on the Borrowing Date
requested by the Borrower on such Borrowing Date in funds
immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the
Administrative Agent crediting the account of the Borrower on the
books of such office with the aggregate of the amounts made
available to the Administrative Agent by the Lenders and in like
funds as received by the Administrative Agent.
2.3 CAF Loans and CAF Loan Notes. (a) The Borrower
may borrow CAF Loans from time to time on any Business Day (in
the case of CAF Loans made pursuant to a Fixed Rate Auction
Advance Request) or any Working Day (in the case of CAF Loans
made pursuant to a LIBOR Auction Advance Request) during the
period from the Closing Date until the date occurring 7 days
prior to the Revolving Credit Termination Date in the manner set
forth in this subsection 2.3 and in amounts such that the
aggregate outstanding principal amount of Revolving Credit Loans
and CAF Loans of all Lenders at any time shall not exceed the
aggregate amount of the Revolving Credit Commitments at such
time. Any Lender may, in its discretion, offer to make, and
make, CAF Loans pursuant to this subsection 2.3 in an aggregate
principal amount exceeding such Lender's Revolving Credit
Commitment.
(b) (i) The Borrower shall request CAF Loans by
delivering a CAF Loan Request to the CAF Loan Agent by telephone
(confirmed promptly on the same day in writing) or by telecopy,
not later than 12:00 Noon (New York City time) four Working Days
prior to the proposed Borrowing Date (in the case of a LIBOR
Auction Advance Request), and not later than 12:00 Noon (New York
City time) one Business Day prior to the proposed Borrowing Date
(in the case of a Fixed Rate Auction Advance Request). Each CAF
Loan Request may solicit bids from each Lender for CAF Loans in
an aggregate principal amount of $5,000,000 or an integral
multiple of $1,000,000 in excess thereof, up to the amount of the
CAF Availability then in effect, and for not more than three
alternative maturity dates for such CAF Loans. The maturity date
for each CAF Loan shall be (i) not less than 7 days nor more than
360 days after the Borrowing Date therefor in the case of CAF
Loans pursuant to a Fixed Rate Auction Advance Request or (ii)
one, two, three, six, nine or twelve months after the Borrowing
Date therefor in the case of CAF Loans pursuant to a LIBOR
Auction Advance Request (and in any event not after the Revolving
Credit Termination Date). The CAF Loan Agent shall promptly
notify each Lender by facsimile transmission of the contents of
each CAF Loan Request received by it.
(ii) In the case of a LIBOR Auction Advance
Request, upon receipt of notice from the CAF Loan Agent of the
contents of such CAF Loan Request, any Lender that elects, in its
sole discretion, to do so, shall irrevocably offer to make one or
more CAF Loans at the Applicable LIBOR Auction Advance Rate plus
or minus a margin for each such CAF Loan determined by such
Lender in its sole discretion. Any such irrevocable offer shall
be made by delivering a CAF Loan Offer to the CAF Loan Agent,
before 9:30 A.M., New York City time, three Working Days before
the proposed Borrowing Date, setting forth the maximum amount of
CAF Loans for each maturity date, and the aggregate maximum
amount for all maturity dates, which such Lender would be willing
to make (which amounts may, subject to subsection 2.3(a), exceed
such Lender's Revolving Credit Commitment) and the margin above
or below the Applicable LIBOR Auction Advance Rate at which such
Lender is willing to make each such CAF Loan; the CAF Loan Agent
shall advise the Borrower before 10:00 A.M., New York City time,
three Working Days before the proposed Borrowing Date of the
contents of each such CAF Loan Offer received by it. If the CAF
Loan Agent in its capacity as a Lender shall, in its sole
discretion, elect to make any such offer, it shall advise the
Borrower of the contents of its CAF Loan Offer before 9:00 A.M.,
New York City time, three Working Days before the proposed
Borrowing Date.
(iii) In the case of a Fixed Rate Auction Advance
Request, upon receipt of notice from the Administrative Agent of
the contents of such CAF Loan Request, any Lender that elects, in
its sole discretion, to do so, shall irrevocably offer to make
one or more CAF Loans at a rate or rates of interest for each
such CAF Loan determined by such Lender in its sole discretion.
Any such irrevocable offer shall be made by delivering a CAF Loan
Offer to the CAF Loan Agent, before 9:30 A.M., New York City
time, on the proposed Borrowing Date, setting forth the maximum
amount of CAF Loans for each maturity date, and the aggregate
maximum amount for all maturity dates, which such Lender would be
willing to make (which amounts may, subject to subsection 2.3(a),
exceed such Lender's Revolving Credit Commitment) and the rate or
rates of interest at which such Lender is willing to make each
such CAF Loan; the CAF Loan Agent shall advise the Borrower
before 10:15 A.M., New York City time, on the proposed Borrowing
Date of the contents of each such CAF Loan Offer received by it.
If the CAF Loan Agent or any affiliate thereof in its capacity as
a Lender shall, in its sole discretion, elect to make any such
offer, it shall advise the Borrower of the contents of its CAF
Loan Offer before 9:15 A.M., New York City time, on the proposed
Borrowing Date.
(iv) The Borrower shall before 10:30 a.m., New
York City time, three Working Days before the proposed Borrowing
Date (in the case of CAF Loans requested by a LIBOR Auction
Advance Request) and before 10:30 a.m., New York City time, on
the proposed Borrowing Date (in the case of CAF Loans requested
by a Fixed Rate Auction Advance Request) either, in its absolute
discretion:
(A) cancel such CAF Loan Request by giving the CAF
Loan Agent telephone notice to that effect, or
(B) accept one or more of the offers made by any
Lender or Lenders pursuant to clause (ii) or clause (iii)
above, as the case may be, by giving telephone notice to the
CAF Loan Agent (immediately confirmed by delivery to the CAF
Loan Agent of a CAF Loan Confirmation) of the amount of CAF
Loans for each relevant maturity date to be made by each
Lender (which amount for each such maturity date shall be
equal to or less than the maximum amount for such maturity
date specified in the CAF Loan offer of such Lender, and for
all maturity dates included in such CAF Loan Offer shall be
equal to or less than the aggregate maximum amount specified
in such CAF Loan offer for all such maturity dates) and
reject any remaining offers made by Lenders pursuant to
clause (ii) or clause (iii) above, as the case may be,
provided that (x) the Borrower may not accept offers for CAF
Loans for any maturity date in an aggregate principal amount
in excess of the maximum principal amount requested in the
related CAF Loan Request, (y) if the Borrower accepts any of
such offers, it must accept offers strictly based upon
pricing for such relevant maturity date and no other
criteria whatsoever and (z) if two or more Lenders submit
offers for any maturity date at identical pricing and the
Borrower accepts any of such offers but does not wish to
borrow the total amount offered by such Lenders with such
identical pricing, the Borrower shall accept offers from all
of such Lenders in amounts allocated among them pro rata
according to the amounts offered by such Lenders (or as
nearly pro rata as shall be practicable after giving effect
to the requirement that CAF Loans made by a Lender on a
Borrowing Date for each relevant maturity date shall be in a
principal amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof, provided that if the number of
Lenders that submit offers for any maturity date at
identical pricing is such that, after the Borrower accepts
such offers pro rata in accordance with the foregoing, the
CAF Loans to be made by such Lenders would be less than
$5,000,000 principal amount, the number of such Lenders
shall be reduced by the CAF Loan Agent by lot until the CAF
Loans to be made by such remaining Lenders would be in a
principal amount of $5,000,000 or an integral multiple of
$1,000,000 in excess thereof).
(v) If the Borrower notifies the CAF Loan Agent that a
CAF Loan Request is cancelled pursuant to clause (iv)(A) above,
the CAF Loan Agent shall give prompt, but in no event more than
one hour later, telephone notice thereof to the Lenders, and the
CAF Loans requested thereby shall not be made.
(vi) If the Borrower accepts pursuant to clause
(iv)(B)
above one or more of the offers made by any Lender or Lenders,
the CAF Loan Agent shall promptly, but in no event more than one
hour later, notify each Lender which has made such an offer of
the aggregate amount of such CAF Loans to be made on such
Borrowing Date for each maturity date and of the acceptance or
rejection of any offers to make such CAF Loans made by such
Lender. Each Lender which is to make a CAF Loan shall, before
12:00 Noon, New York City time, on the Borrowing Date specified
in the CAF Loan Request applicable thereto, make available to the
Administrative Agent at its office set forth in subsection 9.2
the amount of CAF Loans to be made by such Lender, in immediately
available funds. The Administrative Agent will make such funds
available to the Borrower promptly upon receipt thereof on such
date at the Administrative Agent's aforesaid address. As soon as
practicable after each Borrowing Date, the Administrative Agent
shall notify each Lender of the aggregate amount of CAF Loans
advanced on such Borrowing Date and the respective maturity dates
thereof.
(c) Within the limits and on the conditions set forth
in this subsection 2.3, the Borrower may from time to time borrow
under this subsection 2.3, repay pursuant to paragraph (d) below,
and reborrow under this subsection 2.3.
(d) The Borrower shall repay to the Administrative
Agent for the account of each Lender which has made a CAF Loan on
the maturity date of each CAF Loan (such maturity date being that
specified by the Borrower for repayment of such CAF Loan in the
related CAF Loan Request) the then unpaid principal amount of
such CAF Loan. The Borrower shall not have the right to prepay
any principal amount of any CAF Loan; provided, that (i) the
Borrower may prepay all or any portion of the principal amount of
any CAF Loan with the prior written consent of the Lender that
has made such CAF Loan and (ii) any CAF Loan may be Cash
Collateralized by the Borrower.
(e) The Borrower shall pay interest on the unpaid
principal amount of each CAF Loan from the Borrowing Date to the
stated maturity date thereof, at the rate of interest determined
pursuant to paragraph (b) above (calculated on the basis of a
360-day year for actual days elapsed), payable on the interest
payment date or dates specified by the Borrower for such CAF Loan
in the related CAF Loan Request as provided in the CAF Loan Note
evidencing such CAF Loan, provided that, as to any CAF Loan with
a maturity date more than three months after the Borrowing Date
therefor, interest shall be paid on each day which is three
months, or a whole multiple thereof, after the Borrowing Date
therefor and on the maturity date thereof. If all or a portion
of the principal amount of any CAF Loan or any interest or other
amount payable hereunder in respect thereof shall not be paid
when due (whether at the stated maturity, by acceleration or
otherwise), such overdue amount shall, without limiting any
rights of any Lender under this Agreement, bear interest from the
date on which such payment was due at a rate per annum which is
2% above the rate which would otherwise be applicable pursuant to
the CAF Loan Note evidencing such CAF Loan until the scheduled
maturity date with respect thereto as set forth in the CAF Loan
Note evidencing such CAF Loan, and for each day thereafter at
rate per annum which is 2% above the ABR until paid in full (as
well after as before judgment).
(f) The CAF Loans made by each Lender shall be
evidenced by a promissory note of the Borrower, substantially in
the form of Exhibit C with appropriate insertions (a "CAF Loan
Note"), payable to the order of such Lender and representing the
obligation of the Borrower to pay the unpaid principal amount of
all CAF Loans made by such Lender, with interest on the unpaid
principal amount from time to time outstanding of each CAF Loan
evidenced thereby as prescribed in subsection 2.3(e). Each
Lender is hereby authorized to record the date and amount of each
CAF Loan made by such Lender, the maturity date thereof, the date
and amount of each payment of principal thereof and the interest
rate with respect thereto on the schedule annexed to and
constituting part of its CAF Loan Note, and any such recordation
shall constitute prima facie evidence of the accuracy of the
information so recorded, provided that the failure to make any
such recordation shall not affect the obligations of the Borrower
hereunder or under any CAF Loan Note. Each CAF Loan Note shall
be dated the Closing Date and each CAF Loan evidenced thereby
shall bear interest for the period from and including the
Borrowing Date thereof on the unpaid principal amount thereof
from time to time outstanding at the applicable rate per annum
determined as provided in, and such interest shall be payable as
specified in, subsection 2.3(e).
2.4 Fees. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a facility
fee for the period from and including the first day of the
Revolving Credit Commitment Period to but not including the
Revolving Credit Termination Date, computed at the percentage per
annum set forth below for the higher of the applicable S&P Rating
and Moody's Rating set forth below on the average daily amount of
the Revolving Credit Commitment of such Lender during the period
for which payment is made, payable quarterly in arrears on the
last day of each March, June, September and December and on the
Revolving Credit Termination Date or such earlier date as the
Revolving Credit Commitments shall terminate as provided herein,
commencing on the first of such dates to occur after the first
date of the Revolving Credit Commitment Period:
Higher of S&P Rating
and Moody's Rating
S&P Rating Moody's Rating Facility Fee Rate
Any rating of BBB+ Any rating of Baa1 .175 of 1%
or higher or higher
Any rating below Any rating below .225 of 1%
BBB+ but at or Baa1 but at or
above BBB- above Baa3
Any rating at or Any rating at or .325 of 1%
below BB+ or below Ba1 or
unrated unrated
If (i) on any day the S&P Rating and Moody's Rating are not at
the same level, and the lower of such Ratings is one level lower
than the higher of such Ratings, then the fee rates described in
subsections 2.4(a), 2.4(b) and 2.4(c) shall be those applicable
to the higher of such Ratings, and (ii) on any day the S&P Rating
and Moody's Rating are not the same level, and the lower of such
Ratings is more than one level lower than the higher of such
Ratings, then the fee rates described in subsections 2.4(a),
2.4(b) and 2.4(c) shall be those applicable to the Rating next
higher from that of the lower of such Ratings.
(b) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender, a pre-closing commitment
fee for the period from and including the date of this Agreement
to but not including the Closing Date, computed at the percentage
per annum set forth in subsection 2.4(a) for the facility fee
referred to therein, on the average daily amount of the Term Loan
Commitment and Revolving Credit Commitment of such Lender during
the period in respect of which payment is made, payable quarterly
in arrears on the last day of each March, June, September and
December and on the Closing Date or such earlier date on which
the Term Loan Commitments or Revolving Credit Commitments shall
terminate as provided herein, commencing on the first such date
to occur after the date hereof.
(c) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a term loan commitment fee
for the period from and including the Closing Date to the Term
Loan Commitment Termination Date, computed at the percentage per
annum set forth in subsection 2.4(a) for the facility fee
referred to therein, on the average daily undrawn amount of the
Term Loan Commitment of such Lender for the period in respect of
which payment is being made, payable quarterly in arrears on the
last day of each March, June, September and December and on the
Term Loan Commitment Termination Date or such earlier date on
which the Term Loan Commitments shall terminate as provided
herein, commencing on the first such date to occur after the
Closing Date.
(d) The Borrower agrees to pay the CAF Loan Agent a
CAF Loan auction fee equal to $2,500 with respect to each CAF
Loan Request, payable on the date of delivery of such CAF Loan
Request to the CAF Loan Agent pursuant to subsection 2.3(b)(i).
(e) The Borrower agrees to pay to the Administrative
Agent the other fees in the amounts, and on the dates, agreed to
by the Borrower and the Administrative Agent in the Fee Letter,
dated March 3, 1994, between the Administrative Agent and the
Borrower, as amended.
2.5 Termination or Reduction of Commitments. The
Borrower shall have the right, upon not less than two Business
Day's notice to the Administrative Agent, to terminate the
Commitments or, from time to time, to reduce the amount of the
Commitments, provided that no such termination or reduction shall
be permitted if, after giving effect thereto, to any prepayment
of the Revolving Credit Loans or CAF Loans, made on the effective
date thereof and to any CAF Loans that have been Cash
Collateralized, the then outstanding principal amount of the
Revolving Credit Loans and CAF Loans would exceed the amount of
the Revolving Credit Commitments then in effect. Any such
reduction shall be in an amount equal to $5,000,000 or a whole
multiple of $1,000,000 in excess thereof and shall reduce
permanently the applicable Commitments then in effect.
2.6 Optional and Mandatory Prepayments. (a) The
Borrower may, at any time and from time to time, prepay the
Revolving Credit Loans or Term Loans, in whole or in part,
without premium or penalty, upon at least three Business Days'
irrevocable notice to the Administrative Agent in the case of
Eurodollar Loans, and upon at least one Business Day's
irrevocable notice to the Administrative Agent in the case of ABR
Loans, specifying the date and amount of prepayment and whether
the prepayment is of Eurodollar Loans, ABR Loans or a combination
thereof, and, if of a combination thereof, the amount allocable
to each. Upon receipt of any such notice the Administrative
Agent shall promptly notify each Lender thereof. If any such
notice is given, the amount specified in such notice shall be due
and payable on the date specified therein, together with any
amounts payable pursuant to subsection 2.16 in respect of such
prepayment and, in the case of prepayments of the Term Loans and
Revolving Credit Loans that are Eurodollar Loans, accrued
interest to such date on the amount prepaid. Optional partial
prepayments of the Term Loans pursuant to this paragraph (a)
shall be applied first, to the prepayment of the first
installment of principal thereof that is scheduled to be paid on
or after such date and second, 50% of the remaining amount to the
prepayment of the installments of principal thereof in the
forward order of their scheduled maturities and 50% of the
remaining amount to the prepayment of the installments of
principal thereof in the inverse order of their scheduled
maturities. Amounts prepaid on account of the Term Loans may not
be reborrowed. Partial prepayments shall be in an aggregate
principal amount of $5,000,000 or a whole multiple of $1,000,000
in excess thereof.
(b) Any CAF Loans may be prepaid with the prior
written consent of the Lender that has made such CAF Loan and any
CAF Loan may be Cash Collateralized by the Borrower.
(c) Subject to the other provisions of this subsection
(other than the last sentence of paragraph (a)), if there shall
occur any Asset Sale permitted by subsection 6.7(a)(ii), then
within five Business Days of the receipt by the Borrower of the
Net Cash Proceeds of such Asset Sale the Borrower shall apply
such Net Cash Proceeds first, to the prepayment of the
installments of the Term Loans in the inverse order of their
scheduled maturities, and second, to the extent such Net Cash
Proceeds exceed the aggregate outstanding principal amount of the
Term Loans, to the permanent reduction of the Revolving Credit
Commitments (in which case, first, the Revolving Credit Loans
shall be prepaid and, second, if the amount of such reduction is
greater than the aggregate principal amount of Revolving Credit
Loans outstanding, after prepayment of Revolving Credit Loans in
full the CAF Loans shall be Cash Collateralized, in an aggregate
amount so that, after giving effect thereto, the aggregate then
outstanding principal amount of the Revolving Credit Loans and
the non-Cash Collateralized CAF Loans would not exceed the
Revolving Credit Commitments as so reduced).
2.7 Conversion and Continuation Options. (a) The
Borrower may elect from time to time to convert all or any part
of its outstanding Eurodollar Loans to ABR Loans by giving the
Administrative Agent at least one Business Day's prior
irrevocable telephone notice (confirmed promptly on the same day
in writing) of such election, provided that any such conversion
of Eurodollar Loans may only be made on the last day of an
Interest Period with respect thereto. The Borrower may elect
from time to time to convert all or any part of its outstanding
ABR Loans to Eurodollar Loans by giving the Administrative Agent
at least three Business Days' prior irrevocable notice of such
election. Any such notice of conversion to Eurodollar Loans
shall specify the length of the initial Interest Period or
Interest Periods therefor. Upon receipt of any such notice the
Administrative Agent shall promptly notify each Lender thereof.
All or any part of outstanding Eurodollar Loans and ABR Loans may
be converted as provided herein, provided that (i) no Revolving
Credit Loan or Term Loan may be converted into a Eurodollar Loan
when any Event of Default has occurred and is continuing and the
Administrative Agent has or the Required Lenders have determined
that such a conversion is not appropriate and (ii) no Loan may be
converted into a Eurodollar Loan after the date that is one month
prior to the Revolving Credit Termination Date.
(b) All or any part of any Eurodollar Loans may be
continued as such upon the expiration of the then current
Interest Period with respect thereto by the Borrower giving
notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest Period" set forth in
subsection 1.1, of the length of the next Interest Period to be
applicable to such Loans, provided that no Eurodollar Loan may be
continued as such (i) when any Event of Default has occurred and
is continuing and the Administrative Agent has or the Required
Lenders have determined that such a continuation is not
appropriate or (ii) after the date that is one month prior to the
Revolving Credit Termination Date and provided, further, that if
the Borrower shall fail to give any required notice as described
above in this paragraph or if such continuation is not permitted
pursuant to the preceding proviso such Loans shall be
automatically converted to ABR Loans on the last day of such then
expiring Interest Period.
2.8 Minimum Amounts of Tranches. All borrowings,
conversions and continuations of Loans hereunder and all
selections of Interest Periods hereunder shall be in such amounts
and be made pursuant to such elections so that, after giving
effect thereto, the aggregate principal amount of the Loans
comprising each Tranche shall be equal to $5,000,000 or a whole
multiple of $1,000,000 in excess thereof, and there shall be no
more than ten Tranches outstanding at any time.
2.9 Interest Rates and Payment Dates for Revolving
Credit Loans and Term Loans. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with
respect thereto at a rate per annum equal to the Eurodollar Rate
determined for such Eurodollar Loan for such Interest Period plus
the Applicable Margin.
(b) Each ABR Loan shall bear interest at a rate per
annum equal to the ABR plus the Applicable Margin.
(c) If all or a portion of (i) the principal amount of
any Revolving Credit Loan or Term Loan, (ii) any interest payable
thereon or (iii) any facility fee or commitment fee payable
hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), such overdue amount
shall bear interest at a rate per annum which is (x) in the case
of overdue principal, the rate that would otherwise be applicable
thereto pursuant to the foregoing provisions of this subsection
plus 2% or (y) in the case of overdue interest, facility fee or
commitment fee, the rate described in paragraph (b) of this
subsection plus 2%, in each case from the date of such
non-payment until such amount is paid in full (as well after as
before judgment).
(d) Interest shall be payable in arrears on each
Interest Payment Date, provided that interest accruing pursuant
to paragraph (c) of this subsection shall be payable from time to
time on demand.
2.10 Computation of Interest and Fees. (a) Facility
fees, commitment fees and, whenever it is calculated on the basis
of the Prime Rate, interest shall be calculated on the basis of a
365- (or 366-, as the case may be) day year for the actual days
elapsed; and, otherwise, interest shall be calculated on the
basis of a 360-day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the
Borrower and the Lenders of each determination of a Eurodollar
Rate. Any change in the interest rate on a Loan, or in the rate
of calculation of facility fee or commitment fee, resulting from
a change in the ABR, the C/D Assessment Rate, the C/D Reserve
Percentage or a Rating shall become effective as of the opening
of business on the day on which such change becomes effective.
The Administrative Agent shall as soon as practicable notify the
Borrower and the Lenders of the effective date and the amount of
each such change in interest rate.
(b) Each determination of an interest rate by the
Administrative Agent pursuant to any provision of this Agreement
shall be conclusive and binding on the Borrower and the Lenders
in the absence of manifest error. The Administrative Agent
shall, at the request of the Borrower, deliver to the Borrower a
statement showing the quotations used by the Administrative Agent
in determining any interest rate pursuant to subsection 2.9(a).
(c) If any Reference Lender shall for any reason no
longer have a Commitment or any Revolving Credit Loans or Term
Loan, such Reference Lender shall thereupon cease to be a
Reference Lender, and if, as a result, there shall only be one
Reference Lender remaining, the Administrative Agent (after
consultation with the Lenders and after obtaining the consent of
the Borrower (which shall not be unreasonably withheld)) shall,
by notice to the Borrower and the Lenders, designate another
Lender as a Reference Lender so that there shall at all times be
at least two Reference Lenders.
(d) Each Reference Lender shall use its best efforts
to furnish quotations of rates to the Administrative Agent as
contemplated hereby. If any of the Reference Lenders shall be
unable or shall otherwise fail to supply such rates to the
Administrative Agent upon its request, the rate of interest
shall, subject to the provisions of subsection 2.11, be
determined on the basis of the quotations of the remaining
Reference Lenders or Reference Lender.
(e) In computing interest on the Loans, the date of
the making of such Loan or the first day of Interest Period
applicable to such Loan or, with respect to an ABR Loan being
converted from a Eurodollar Loan, the date of conversion of such
Eurodollar Loan to such ABR Loan, as the case may be, shall be
included, and the date of payment of such Loan or the expiration
date of an Interest Period applicable to such Loan or, with
respect to an ABR Loan being converted to a Eurodollar Loan, the
date of conversion of such ABR Loan to such Eurodollar Loan, as
the case may be, shall be excluded; provided that if a Loan is
repaid on the same day on which it is made, one day's interest
shall be paid on that Loan.
2.11 Inability to Determine Interest Rate. If prior
to the first day of any Interest Period:
(a) the Administrative Agent shall have determined
(which determination shall be conclusive and binding upon
the Borrower) that, by reason of circumstances affecting the
relevant interbank eurodollar market, adequate and
reasonable means do not exist for ascertaining the
Eurodollar Rate for such Interest Period, or
(b) the Administrative Agent shall have received
notice from the Required Lenders that the Eurodollar Rate
determined or to be determined for such Interest Period will
not adequately and fairly reflect the cost to such Lenders
(as conclusively certified by such Lenders) of making or
maintaining their affected Loans during such Interest
Period,
the Administrative Agent shall give telecopy or telephonic notice
thereof (confirmed in writing) to the Borrower and the Lenders as
soon as practicable thereafter. If such notice is given (x) any
Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as ABR Loans, (y) any Loans that
were to have been continued on the first day of such Interest
Period as, or converted on the first day of such Interest Period
to, Eurodollar Loans shall be converted to or continued as ABR
Loans and (z) any notice of borrowing or notice of conversion or
continuation with respect thereto shall be deemed to be modified
as described in the foregoing clauses (x) or (y), as the case may
be. Until such notice has been withdrawn by the Administrative
Agent, no further Eurodollar Loans shall be made or continued as
such, nor shall the Borrower have the right to convert ABR Loans
to Eurodollar Loans.
2.12 Pro Rata Treatment and Payments. (a) Each
borrowing by the Borrower of Revolving Credit Loans or Term Loans
and any reduction of the Revolving Credit Commitments or Term
Loan Commitments shall be made pro rata according to the Lenders'
respective Revolving Credit Commitment Percentages or Term Loan
Commitment Percentages, as applicable.
(b) Unless otherwise specified herein, each payment by
the Borrower on account of any facility fee or commitment fee
hereunder shall be made pro rata according to the Lenders'
respective Revolving Credit Commitment Percentages or Term Loan
Commitment Percentages, as applicable. Each scheduled payment
and each mandatory prepayment by the Borrower on account of
principal of and interest on the Term Loans or Revolving Credit
Loans shall be made pro rata according to the respective amounts
of principal or interest, as the case may be, then due and owing
to the Lenders. Each voluntary prepayment of the Term Loans or
Revolving Credit Loans shall be made pro rata according to the
respective outstanding principal amounts of Revolving Credit
Loans or Term Loans, as applicable, then held by the Lenders.
All payments hereunder shall be applied first, on account of
interest, second, on account of principal, third, on account of
all fees and expenses due and owing hereunder to the
Administrative Agent and fourth, on account of all fees and
expenses due and owing hereunder to the Lenders; provided,
however, that following the occurrence and during the continuance
of any Default or Event of Default, all payments hereunder shall
be applied first, on account of all fees and expenses due and
owing hereunder to the Administrative Agent, second on account of
all fees and expenses due and owing hereunder to the Lenders,
and, third on account of principal and interest.
(c) All payments (including prepayments) to be made by
the Borrower hereunder and under the Notes, whether on account of
principal, interest, fees or otherwise, shall be made without set
off or counterclaim and shall be made prior to 12:00 Noon, New
York City time, on the due date thereof, to the Administrative
Agent, for the account of the Lenders, at the Administrative
Agent's office specified in subsection 9.2, in Dollars and in
immediately available funds. The Administrative Agent shall
distribute such payments to the Lenders promptly upon receipt in
like funds as received. If any payment hereunder (other than
payments on the CAF Loans made pursuant to a LIBOR Auction
Advance Request) becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next
succeeding Business Day, and, with respect to payments of
principal, interest thereon shall be payable at the then
applicable rate during such extension. If any payment on a CAF
Loan made pursuant to a LIBOR Auction Advance Request becomes due
and payable on a day other than a Working Day, the maturity
thereof shall be extended to the next succeeding Working Day,
unless the result of such extension would be to extend such
payment into another calendar month, in which event such payment
shall be made on the immediately preceding Working Day.
(d) Unless the Administrative Agent shall have been
notified in writing by any Lender prior to a borrowing of
Revolving Credit Loans or Term Loans that such Lender will not
make the amount that would constitute its Revolving Credit
Commitment Percentage or Term Loan Commitment Percentage, as
applicable, of such borrowing available to the Administrative
Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the
Administrative Agent may, in reliance upon such assumption, make
available to the Borrower a corresponding amount. If such amount
is not made available to the Administrative Agent by the required
time on the Borrowing Date therefor, such Lender shall pay to the
Administrative Agent, on demand, such amount with interest
thereon at a rate equal to the daily average Federal Funds
Effective Rate for the period until such Lender makes such amount
immediately available to the Administrative Agent. A certificate
of the Administrative Agent submitted to any Lender with respect
to any amounts owing under this subsection shall be conclusive in
the absence of manifest error. If such Lender's Revolving Credit
Commitment Percentage or Term Loan Commitment Percentage, as
applicable, of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days of
such Borrowing Date, the Administrative Agent shall also be
entitled to recover such amount with interest thereon at the rate
per annum applicable to ABR Loans hereunder, on demand, from the
Borrower. Nothing in this subsection 2.12(d) shall be deemed to
relieve any Lender from its obligation to fulfill its Commitments
hereunder or to prejudice any rights that the Borrower may have
against any Lender as a result of any default by such Lender
hereunder.
2.13 Illegality. Notwithstanding any other provision
herein, if the adoption of or any change in any Requirement of
Law or in the interpretation or application thereof shall make it
unlawful for any Lender to make or maintain Eurodollar Loans as
contemplated by this Agreement, upon giving written notice
thereof to the Administrative Agent and the Borrower, (a) the
commitment of such Lender hereunder to make Eurodollar Loans,
continue Eurodollar Loans as such and convert ABR Loans to
Eurodollar Loans shall forthwith be suspended until such notice
shall be withdrawn by such Lender and (b) such Lender's Loans
then outstanding as Eurodollar Loans, if any, shall be converted
automatically to ABR Loans on the respective last days of the
then current Interest Periods with respect to such Loans or
within such earlier period as required by law. If any such
conversion of a Eurodollar Loan occurs on a day which is not the
last day of the then current Interest Period with respect
thereto, the Borrower shall pay to such Lender such amounts, if
any, as may be required pursuant to subsection 2.16.
Notwithstanding the foregoing, to the extent that a notice by any
Lender as described above relates to a Eurodollar Loan then being
requested by the Borrower pursuant to a notice of borrowing or a
notice of conversion/continuation, the Borrower shall have the
option to rescind such notice of borrowing or notice of
conversion/continuation as to all Lenders by giving notice to the
Administrative Agent of such rescission on the date on which such
Lender gives notice as described above (which notice of
rescission the Administrative Agent shall promptly transmit to
each other Lender). Except as provided in the immediately
preceding sentence, nothing in this subsection 2.13 shall affect
the obligation of any Lender (other than the Lender giving notice
as described above) to make or maintain Loans as, or to convert
Loans to, Eurodollar Loans in accordance with the terms of this
Agreement.
2.14 Requirements of Law. (a) If the adoption after
the date hereof of or any change after the date hereof in any
Requirement of Law or in the interpretation or application
thereof or compliance by any Lender with any request or directive
(whether or not having the force of law) from any central bank or
other Governmental Authority made in each case subsequent to the
date hereof:
(i) shall subject any Lender to any tax of any kind
whatsoever with respect to this Agreement, any Revolving
Credit Note or Term Note or any Eurodollar Loan made by it,
or change the basis of taxation of payments to such Lender
in respect thereof (except for Non-Excluded Taxes covered by
subsection 2.15 and taxes on the overall net income of such
Lender, or any change therein);
(ii) shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar
requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of
funds by, any office of such Lender which is not otherwise
included in the determination of the Eurodollar Rate
hereunder; or
(iii) shall impose on such Lender any other condition
(other than with respect to a tax matter described in
subsection 2.15 and taxes on the overall net income of such
Lender, or any change therein) on or affecting such Lender
or its obligations hereunder or the interbank eurodollar
market;
and the result of any of the foregoing is to increase the cost to
such Lender, by an amount which such Lender deems to be material,
of making, converting into, continuing or maintaining Eurodollar
Loans or to reduce any amount receivable hereunder in respect
thereof, then, in any such case, the Borrower shall promptly pay
such Lender, upon its receipt of the statement referred to in the
next sentence, any additional amounts necessary to compensate
such Lender for such increased cost or reduced amount receivable.
If any Lender becomes entitled to claim any additional amounts
pursuant to this subsection, it shall promptly notify the
Borrower (with a copy to the Administrative Agent) of the event
by reason of which it has become so entitled and shall deliver to
the Borrower (with a copy to the Administrative Agent) a written
statement, setting forth in reasonable detail the basis for
calculating the additional amounts owed to such Lender under this
subsection 2.14(a). Such statement as to any additional amounts
payable pursuant to this subsection submitted by such Lender to
the Borrower (with a copy to the Administrative Agent) shall be
conclusive in the absence of manifest error.
(b) If any Lender shall have determined that the
adoption after the date hereof of or any change after the date
hereof in any Requirement of Law regarding capital adequacy or in
the interpretation or application thereof or compliance by such
Lender or any corporation controlling such Lender with any
request or directive regarding capital adequacy (whether or not
having the force of law) from any Governmental Authority made in
each case subsequent to the date hereof, shall have the effect of
reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations
hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such
corporation's policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then from time to
time, after submission by such Lender to the Borrower (with a
copy to the Administrative Agent) of a written request therefor
(which written request shall set forth the basis of the
calculation of such additional amounts with the same level of
detail as such Lender provides to borrowers (if any) who are
similarly situated as the Borrower, including without limitation,
with respect to credit standing, in connection with credit
facilities similar to those made available pursuant to this
Agreement, where the documents governing such credit facilities
establish the right of such Lender to collect such payments), the
Borrower shall pay to such Lender such additional amount or
amounts as will compensate such Lender for such reduction;
provided, however, that such Lender shall not have the right to
collect payments from the Borrower pursuant to this subsection
2.14(b) unless it is the policy of such Lender, at the time of
such collection, to collect similar payments from borrowers (if
any) who are similarly situated as the Borrower, including
without limitation, with respect to credit standing, in
connection with credit facilities similar to those made available
pursuant to this Agreement, where the documents governing such
credit facilities establish the right of such Lender to collect
such payments.
(c) In addition to, and without duplication of,
amounts which may become payable from time to time pursuant to
paragraphs (a) and (b) of this subsection 2.14, the Borrower
agrees to pay to each Lender which requests compensation under
this paragraph (c) by notice to the Borrower, on the last day of
each Interest Period with respect to any Eurodollar Loan made by
such Lender, at any time when such Lender shall be required to
maintain reserves against "Eurocurrency liabilities" under
Regulation D of the Board (or, at any time when such Lender may
be required by the Board or by any other Governmental Authority
to maintain reserves against any other category of liabilities
which includes deposits by reference to which the Eurodollar Rate
is determined as provided in this Agreement or against any
category of extensions of credit or other assets of such Lender
which includes any Eurodollar Loans), an additional amount
(determined by such Lender's calculation or, if an accurate
calculation is impracticable, reasonable estimate (using such
reasonable means of allocation as such Lender shall determine) of
the actual costs, if any, incurred by such Lender during such
Interest Period as a result of the applicability of the foregoing
reserves to such Eurodollar Loans.
(d) The agreements in this subsection 2.14 shall
survive the termination of this Agreement and payment of the
Notes and all other amounts payable hereunder.
2.15 Taxes. (a) All payments made by the Borrower
under this Agreement and the Notes shall be made free and clear
of, and without deduction or withholding for or on account of,
any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now
or hereafter imposed, levied, collected, withheld or assessed by
any Governmental Authority, excluding net income taxes and
franchise taxes (imposed in lieu of net income taxes) imposed on
the Administrative Agent or any Lender as a result of a present
or former connection between the Administrative Agent or such
Lender and the jurisdiction of the Governmental Authority
imposing such tax or any political subdivision or taxing
authority thereof or therein (other than any such connection
arising solely from the Administrative Agent or such Lender
having executed, delivered, made Loans under or received a
payment under, or enforced, this Agreement or the Notes). If any
such non-excluded taxes, levies, imposts, duties, charges, fees
deductions or withholdings ("Non-Excluded Taxes") are required to
be withheld from any amounts payable to the Administrative Agent
or any Lender hereunder or under the Notes, the amounts so
payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative
Agent or such Lender (after payment of all Non-Excluded Taxes)
interest or any such other amounts payable hereunder at the rates
or in the amounts specified in this Agreement and the Notes,
provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender that is not
organized under the laws of the United States of America or a
state thereof if such Lender fails to comply with the
requirements of paragraph (b) of this subsection. Whenever any
Non-Excluded Taxes are payable by the Borrower, as promptly as
possible thereafter the Borrower shall send to the Administrative
Agent for its own account or for the account of such Lender, as
the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof. If the
Borrower fails to pay any Non-Excluded Taxes when due to the
appropriate taxing authority or fails to remit to the
Administrative Agent the required receipts or other required
documentary evidence, the Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes,
interest or penalties that may become payable by the
Administrative Agent or any Lender as a result of any such
failure.
(b) Each Lender that is not incorporated under the
laws of the United States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative
Agent (A) two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, or successor
applicable form, as the case may be, and (B) an Internal
Revenue Service Form W-8 or W-9, or successor applicable
form, as the case may be;
(ii) deliver to the Borrower and the Administrative
Agent two further copies of any such form or certification
on or before the date that any such form or certification
expires or becomes obsolete and after the occurrence of any
event requiring a change in the most recent form previously
delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and
complete such forms or certifications as may reasonably be
requested by the Borrower or the Administrative Agent;
unless in any such case any change in treaty, law or regulation
has occurred prior to the date on which any such delivery would
otherwise be required which renders all such forms inapplicable
or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender so
advises the Borrower and the Administrative Agent. Such Lender
shall certify (i) in the case of a Form 1001 or 4224, that it is
entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income
taxes and (ii) in the case of a Form W-8 or W-9, that it is
entitled to an exemption from United States backup withholding
tax. Each Person that shall become a Lender or a Participant
pursuant to subsection 9.6 shall, upon the effectiveness of the
related transfer, be required to provide all of the forms and
statements required pursuant to this subsection, provided that in
the case of a Participant such Participant shall furnish all such
required forms and statements to the Lender from which the
related participation shall have been purchased.
(c) The agreements in this subsection 2.15 shall
survive the termination of this Agreement and the payment of the
Notes and all other amounts payable hereunder.
2.16 Indemnity. The Borrower agrees, upon written
request by any Lender (which request shall set forth the basis
for such request), to indemnify such Lender and to hold such
Lender harmless from, any reasonable loss or expense which such
Lender may sustain or incur as a consequence of (a) default by
the Borrower in making a borrowing of, conversion into or
continuation of Eurodollar Loans or CAF Loans after the Borrower
has given a notice requesting the same in accordance with the
provisions of this Agreement (other than due to a rescission by
the Borrower pursuant to subsection 2.11 or 2.13), (b) default by
the Borrower in making any prepayment of any of its Eurodollar
Loans after the Borrower has given a notice thereof in accordance
with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans or CAF Loans on a day which is not
the last day of an Interest Period, or the maturity date, as the
case may be, with respect thereto. Such indemnification may
include an amount equal to the excess, if any, of (i) the amount
of interest which would have accrued on the amount so prepaid, or
not so borrowed, converted or continued, for the period from the
date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case
of a failure to borrow, convert or continue, the Interest Period
that would have commenced on the date of such failure) in each
case at the applicable rate of interest for such Loans provided
for herein (excluding, however, the Applicable Margin included
therein, if any) over (ii) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such
Lender on such amount by placing such amount on deposit for a
comparable period with leading banks in the interbank eurodollar
market. This covenant shall survive the termination of this
Agreement and the payment of the Notes and all other amounts
payable hereunder.
2.17 Lenders' Obligation to Mitigate. Each Lender
agrees that, as promptly as practicable after the officer of such
Lender responsible for administering the Loans under this
Agreement becomes aware of the occurrence of an event or the
existence of a condition that would cause such Lender to suspend
its commitment to make or continue Eurodollar Loans hereunder
pursuant to subsection 2.13 or that would entitle such Lender to
receive payments under subsection 2.14 or 2.15, it will, if
requested by the Borrower, use reasonable efforts (i) to make,
fund or maintain the Commitments of such Lender or the affected
Loans of such Lender through another lending office of such
Lender, or (ii) take such other measures as such Lender may deem
reasonable, if as a result thereof the circumstances which would
cause such Lender to suspend its commitment to make or continue
Eurodollar Loans hereunder pursuant to subsection 2.13 would
cease to exist or the additional amounts which would otherwise be
required to be paid to such Lender pursuant to subsection 2.14 or
2.15 would be materially reduced and if, as determined by such
Lender in its reasonable discretion, the making, funding or
maintaining of such Commitments or Loans through such other
lending office or in accordance with such other measures, as the
case may be, would not otherwise materially adversely affect such
Commitments or Loans or the interests of such Lender; provided
that such Lender will not be obligated to utilize such other
lending office pursuant to this subsection 2.17 if such
utilization would, in the reasonable judgment of such Lender, be
disadvantageous to such Lender in any material respect.
SECTION 3. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent, the CAF Loan Agent
and the Lenders to enter into this Agreement and to make the
Loans, the Borrower hereby represents and warrants to the
Administrative Agent and each Lender that:
3.1 Financial Condition. (a) The consolidated
balance sheet of the Borrower and its consolidated Subsidiaries
as at June 30, 1993 and the related consolidated statements of
income and of cash flows for the fiscal year ended on such date,
reported on by Deloitte & Touche, copies of which were furnished
prior to the date of this Agreement to the Administrative Agent
and each Lender party to this Agreement on the date of this
Agreement, present fairly the consolidated financial condition of
the Borrower and its consolidated Subsidiaries as at such date,
and the consolidated results of their operations and their
consolidated cash flows for the fiscal year then ended. The
unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at December 31, 1993 and the related
unaudited consolidated statements of income and of cash flows for
the six-month period ended on such date, certified by a
Responsible Officer, copies of which were furnished to each
Lender, present fairly the consolidated financial condition of
the Borrower and its consolidated Subsidiaries as at such date,
and the consolidated results of their operations and their
consolidated cash flows for the six-month period then ended
(subject to normal year-end audit adjustments). All such
financial statements, including the related schedules and notes
thereto, have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved
by such accountants or Responsible Officer, as the case may be,
and as disclosed therein). Neither the Borrower nor any of its
consolidated Subsidiaries had, at the date of the most recent
balance sheet referred to above, any material Guarantee
Obligation, contingent liability or liability for taxes, or any
material long-term lease or unusual forward or long-term
commitment, including, without limitation, any material interest
rate or foreign currency swap or exchange transaction, which is
not reflected in the foregoing statements or in the notes
thereto. Except as disclosed in such financial statements,
during the period from June 30, 1993 to and including the date
hereof there has been no sale, transfer or other disposition by
the Borrower or any of its consolidated Subsidiaries of any
material part of its business or property and (other than the
Merger) no purchase or other acquisition of any business or
property (including any capital stock of any other Person)
material in relation to the consolidated financial condition of
the Borrower and its consolidated Subsidiaries at June 30, 1993.
(b) Prior to the date of this Agreement, the Borrower
delivered to the Administrative Agent and each Lender that is a
party to the Agreement on the date of this Agreement an unaudited
preliminary pro forma consolidated balance sheet of the Borrower
and its Subsidiaries as at December 31, 1993 (the "Preliminary
Pro-forma Balance Sheet"), prepared based upon the consolidated
balance sheet of the Borrower and its Subsidiaries as of December
31, 1993 adjusted to give effect (as if such events had occurred
on December 31, 1993) to (i) the Merger and the other
transactions contemplated by the Merger Documents, and (ii) this
Agreement and the transactions contemplated hereby.
(c) Prior to the Closing Date, the Borrower will
deliver to the Administrative Agent and each Lender an unaudited
pro forma consolidated balance sheet of the Borrower and its
Subsidiaries as at December 31, 1993 (including the notes
thereto, if any) (the "Pro-forma Balance Sheet"), prepared based
upon the consolidated balance sheet of the Borrower and its
Subsidiaries as of December 31, 1993 adjusted to give effect (as
if such events had occurred on December 31, 1993) to (i) the
Merger and the other transactions contemplated by the Merger
Documents, and (ii) this Agreement and the transactions
contemplated hereby. The Pro Forma Balance Sheet will present
fairly on a pro forma basis the consolidated financial position
of the Borrower and its Subsidiaries as at December 31, 1993
assuming that the events and assumptions specified in the
preceding sentence had actually occurred or are true, as the case
may be, on that date.
3.2 No Change. Since June 30, 1993 there has been no
development or event which has had or could reasonably be
expected to have a Material Adverse Effect.
3.3 Corporate Existence; Compliance with Law. Each of
the Borrower and its Subsidiaries (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction
of its organization, (b) has the corporate power and authority,
and the legal right, to own and operate its property, to lease
the property it operates as lessee and to conduct the business in
which it is currently engaged, (c) is duly qualified as a foreign
corporation and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of property
or the conduct of its business requires such qualification,
except in jurisdictions where the failure to be so qualified or
in good standing has not had and could not reasonably be expected
to have a Material Adverse Effect, and (d) is in compliance with
all Requirements of Law, including, without limitation, HMO
Regulations and Insurance Regulations, except to the extent that
the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.
3.4 Corporate Power; Authorization; Enforceable
Obligations. The Borrower has the corporate power and authority
to execute, deliver and perform the Loan Documents and the Merger
Documents to which it is a party and to borrow hereunder and has
taken all necessary corporate action to authorize the borrowings
on the terms and conditions of this Agreement and the Notes and
to authorize the execution, delivery and performance of the Loan
Documents and the Merger Documents to which it is a party.
Merger Sub has the corporate power and authority to execute,
deliver and perform the Merger Documents to which it is a party
and has taken all necessary corporate action to authorize the
execution, delivery and performance of the Merger Documents to
which it is a party. No consent or authorization of, filing
with, notice to or other act by or in respect of, any
Governmental Authority including, without limitation, HMO
Regulators and Insurance Regulators, or any other Person is
required in connection with the borrowings hereunder or the
Merger or with the execution, delivery or performance of the Loan
Documents or the Merger Documents to which the Borrower or Merger
Sub is a party other than (i) any of the foregoing, which will
have been duly obtained and will be in full force and effect on
the Closing Date or (ii) any of the foregoing the absence of
which could not reasonably be expected to have a Material Adverse
Effect. This Agreement has been, and each other Loan Document
and Merger Document to which it is a party will be, duly executed
and delivered on behalf of the Borrower. This Agreement
constitutes, and each other Loan Document and Merger Document to
which it is a party when executed and delivered by each party
thereto will constitute, a legal, valid and binding obligation of
the Borrower enforceable against the Borrower in accordance with
its terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors' rights generally or by general
equitable principles (whether enforcement is sought by
proceedings in equity or at law).
3.5 No Legal Bar. Except for any potential violations
set forth on Schedule V, all of which will have been eliminated
on or before the Closing Date, the execution, delivery and
performance by the Borrower and the Merger Sub of the Loan
Documents and Merger Documents to which the Borrower or Merger
Sub is a party, the borrowings hereunder and the use of the
proceeds thereof will not violate their respective Certificates
of Incorporation, By-laws or other organizational or governing
documents, any Requirement of Law, including, without limitation,
HMO Regulations and Insurance Regulations, or Contractual
Obligation of the Borrower or of any of its Subsidiaries the
violation of which could reasonably be expected to have a
Material Adverse Effect and will not result in, or require, the
creation or imposition of any Lien on any of its or their
respective properties or revenues pursuant to any such
Requirement of Law or Contractual Obligation.
3.6 Delivery of Merger Agreement and Certain Other
Documents. The Administrative Agent has received for itself and
for each Lender a complete copy of the Merger Agreement
(including all exhibits, schedules and letters referred to
therein or delivered pursuant thereto, if any) and all amendments
thereto, waivers relating thereto and other side letters or
agreements affecting the terms thereof. The Merger Agreement has
not been amended or otherwise modified in any material respect
except to the extent that the Required Lenders have approved in
writing.
3.7 Representations and Warranties Contained in the
Merger Agreement. Assuming the due authorization, execution and
delivery of the Merger Agreement by TakeCare, the Merger
Agreement has been duly executed and delivered by the parties
thereto, is in full force and effect on the date of this
Agreement and will be in full force and effect on the Closing
Date. The representations and warranties of the Borrower and
Merger Sub, and, to the best of the Borrower's knowledge, the
material representations and warranties of TakeCare, set forth in
the Merger Agreement are true and correct in all material
respects on the date of this Agreement and will be true and
correct in all material respects on the Closing Date, in each
case except to the extent such representations and warranties
specifically relate to an earlier date, in which case such
representations and warranties were true and correct in all
material respects on and as of such earlier date.
3.8 Consummation of Merger. Simultaneously with the
making of the initial Loans on the Closing Date, the Merger shall
have been duly consummated in accordance with (i) the Merger
Agreement, (ii) the certificates of incorporation by-laws and
other applicable corporate rules, if any, of TakeCare and Merger
Sub and (iii) all applicable laws except those the violation of
which would not have a Material Adverse Effect .
3.9 No Material Litigation. No litigation,
investigation or proceeding of or before any arbitrator or
Governmental Authority including, without limitation, HMO
Regulators and Insurance Regulators, is pending or, to the
knowledge of the Borrower, threatened by or against the Borrower
or any of its Subsidiaries or against any of its or their
respective properties or revenues (a) with respect to any of the
Merger Documents or any of the transactions contemplated thereby
which could reasonably be expected to have a Material Adverse
Effect, or (b) which could reasonably be expected to have a
Material Adverse Effect.
3.10 No Default. Neither the Borrower nor any of its
Subsidiaries is in default under or with respect to any of its
Contractual Obligations in any respect which could reasonably be
expected to have a Material Adverse Effect. No Default or Event
of Default has occurred and is continuing.
3.11 Ownership of Property; Liens. Each of the
Borrower and its Subsidiaries has good record and marketable
title in fee simple to, or a valid leasehold interest in, all its
real property, and good title to, or a valid leasehold interest
in, all its other property, except as could not reasonably be
expected to have a Material Adverse Effect, and none of such
property is subject to any Lien except as permitted by subsection
6.4.
3.12 Taxes. Each of the Borrower and its Subsidiaries
has filed or caused to be filed all tax returns which, to the
knowledge of the Borrower, are required to be filed and has paid
all taxes shown to be due and payable on said returns or on any
assessments made against it or any of its property and all other
taxes, fees or other charges imposed on it or any of its property
by any Governmental Authority (other than any the amount or
validity of which are currently being contested in good faith by
appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of the
Borrower or its Subsidiaries, as the case may be), except where
the failure to do so could not reasonably be expected to have a
Material Adverse Effect; no tax Lien has been filed, and, to the
knowledge of the Borrower, no claim is being asserted, with
respect to any such tax, fee or other charge, except to the
extent that such Lien or claim could not reasonably be expected
to have a Material Adverse Effect.
3.13 Federal Regulations. No part of the proceeds of
any Loans will be used for "purchasing" or "carrying" any "margin
stock" within the respective meanings of each of the quoted terms
under Regulation G or Regulation U of the Board in violation of
the provisions of the Regulations of the Board. If requested by
any Lender or the Administrative Agent, the Borrower will furnish
to the Administrative Agent and such Lender a statement to the
foregoing effect in conformity with the requirements of FR Form
G-3 or FR Form U-1 referred to in said Regulation G or Regulation
U, as the case may be. After giving effect to the making of the
Loans and the application of the proceeds thereof, not more than
25% in value of the assets of the Borrower, or of the Borrower
and its Subsidiaries, will consist of "margin stock" within the
meaning of Regulations U and G of the Board.
3.14 ERISA. Neither a Reportable Event nor an
"accumulated funding deficiency" (within the meaning of
Section 412 of the Code or Section 302 of ERISA) has occurred
during the five-year period prior to the date on which this
representation is made or deemed made with respect to any Plan,
and each Plan has complied in all material respects with the
applicable provisions of ERISA and the Code. No termination of a
Single Employer Plan has occurred, and no Lien in favor of the
PBGC or a Plan has arisen, during such five-year period. The
present value of all accrued benefits under each Single Employer
Plan (based on those assumptions used to fund such Plans) did
not, as of the last annual valuation date prior to the date on
which this representation is made or deemed made, exceed the
value of the assets of such Plan allocable to such accrued
benefits. Neither the Borrower nor any Commonly Controlled
Entity has within the last five years withdrawn from or had any
obligation to contribute to any Multiemployer Plan. Neither the
Borrower nor any Commonly Controlled Entity has any liability or
obligation to make contributions with respect to retiree health,
medical or life insurance benefits for current or former
employees under any Plan, except as required by Sections 601
through 608 of ERISA and Section 4980 of the Code.
3.15 Investment Company Act; Other Regulations. The
Borrower is not an "investment company", or a company
"controlled" by an "investment company", within the meaning of
the Investment Company Act of 1940, as amended. The Borrower is
not subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board) which limits
its ability to incur Indebtedness.
3.16 Subsidiaries. Schedule II lists all the
Subsidiaries of the Borrower and, to the best of the Borrower's
knowledge, of TakeCare, at the date of this Agreement.
3.17 Purpose of Loans. The proceeds of the Term Loans
shall be used by the Borrower solely to finance a portion of the
Merger Consideration and to redeem the Non-Convertible Merger
Preferred Stock (collectively, "Acquisition Purposes"); and the
proceeds of the Revolving Credit Loans and CAF Loans shall be
used only for Acquisition Purposes, to pay fees and expenses in
connection therewith, and for general corporate purposes in the
ordinary course of business; provided, that no proceeds of
Revolving Credit Loans or CAF Loans may be used for Acquisition
Purposes prior to the Term Loan Commitment Termination Date until
the Borrower has used at least $100,000,000 of cash (other than
the proceeds of the Loans) and the proceeds of $250,000,000 of
Term Loans for Acquisition Purposes, and no proceeds of Revolving
Credit Loans or CAF Loans may be used for Acquisition Purposes
after the Term Loan Commitment Termination Date unless, after
giving effect thereto, the Revolving Credit Commitments, less the
outstanding principal amount of Revolving Credit Loans and CAF
Loans, aggregate at least $28,000,000 without the Borrower's
having made any change in its customary methods of cash
management and timing of payment of its indebtedness and accounts
payable.
3.18 Environmental Matters. Each of the
representations and warranties set forth in paragraphs (a)
through (f) of this subsection is true and correct with respect
to each parcel of real property owned by the Borrower or its
Subsidiaries and used in its operations or any real property
which is leased by the Borrower or its Subsidiaries (the
"Borrower Properties"), except to the extent that the facts and
circumstances giving rise to any such failure to be so true and
correct could not reasonably be expected to have a Material
Adverse Effect:
(a) The Borrower Properties do not contain, and have
not previously contained, any Materials of Environmental
Concern in amounts or concentrations which (i) constitute or
constituted a violation of, or (ii) could reasonably be
expected to give rise to liability under, any Environmental
Law.
(b) The Borrower Properties and all operations at the
Borrower Properties are in compliance, and have in the last
five years been in compliance, in all material respects with
all applicable Environmental Laws, and there is no
contamination at, under or about the Borrower Properties or
violation of any Environmental Law with respect to the
Borrower Properties or the business operated by the Borrower
or any of its Subsidiaries (the "Business") which could
materially interfere with the continued operation of the
Borrower Properties or materially impair the fair saleable
value thereof.
(c) Neither the Borrower nor any of its Subsidiaries
has received any notice of violation, alleged violation,
non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws
with regard to any of the Borrower Properties or the
Business, nor does the Borrower have knowledge or reason to
believe that any such notice will be received or is being
threatened.
(d) Materials of Environmental Concern have not been
transported or disposed of from the Borrower Properties in
violation of, or in a manner or to a location which could
reasonably be expected to give rise to liability under, any
Environmental Law, nor have any Materials of Environmental
Concern been generated, treated, stored or disposed of at,
on or under any of the Borrower Properties in violation of,
or in a manner that could reasonably be expected to give
rise to liability under, any applicable Environmental Law.
(e) No judicial proceeding or governmental or
administrative action is pending or, to the knowledge of the
Borrower, threatened, under any Environmental Law to which
the Borrower or any Subsidiary is or will be named as a
party with respect to the Borrower Properties or the
Business, nor are there any consent decrees or other
decrees, consent orders, administrative orders or other
orders, or other administrative or judicial requirements
outstanding under any Environmental Law with respect to the
Borrower Properties or the Business.
(f) There has been no release or threat of release of
Materials of Environmental Concern at or from the Borrower
Properties, or arising from or related to the operations of
the Borrower or any Subsidiary in connection with the
Borrower Properties or otherwise in connection with the
Business, in violation of or in amounts or in a manner that
could reasonably be expected to give rise to liability under
Environmental Laws.
3.19 Disclosure. Neither this Agreement nor any
agreement, document, certificate or written statement furnished
to the Administrative Agent or the Lenders by the Borrower or its
advisors in connection herewith (including, without limitation,
the information relating to the Borrower and its Subsidiaries
furnished by the Borrower and included in the Confidential
Information Memorandum dated March, 1994 delivered in connection
with the syndication of the credit facilities hereunder but
excluding the pro forma financial statements and other
information described in the next sentence in respect of which
the Borrower makes the representation and warranty set forth in
the next sentence) contains any untrue statement of material fact
or, taken as a whole together with all other information
furnished to Administrative Agent or the Lenders by the Borrower
or its advisors, omits to state a material fact (known to the
Borrower, in the case of any document not furnished by it)
necessary in order to make the statements contained herein or
therein not misleading in light of the circumstances in which the
same were made. All pro forma financial statements made
available to Administrative Agent or the Lenders have been
prepared in good faith based upon assumptions believed by the
Borrower to be reasonable at the time they were prepared, it
being recognized by the Administrative Agent and the Lenders that
such pro forma financial statements are not to be viewed as facts
and that actual results during the period or periods covered
thereby may differ from the pro forma results.
SECTION 4. CONDITIONS PRECEDENT
4.1 Conditions to Initial Loans. The agreement of
each Lender to make the initial Loan requested to be made by it
is subject to the satisfaction, immediately prior to or
concurrently with the making of such Loan on the Closing Date, of
the following conditions precedent:
(a) Loan Documents. The Administrative Agent shall
have received (i) this Agreement, executed and delivered by
a duly authorized officer of the Borrower, with a
counterpart for each Lender, (ii) for the account of each
Lender, a Revolving Credit Note conforming to the
requirements hereof and executed by a duly authorized
officer of the Borrower, (iii) for the account of each
Lender, a Term Note conforming to the requirements hereof
and duly executed by a duly authorized officer of the
Borrower and (iv) for the account of each Lender, a CAF Loan
Note conforming to the requirements hereof and duly executed
by a duly authorized officer of the Borrower.
(b) Related Agreements. The Administrative Agent
shall have received, with a copy for each Lender, true and
correct copies, certified as to authenticity by the
Borrower, of the Merger Agreement, and such other documents
or instruments as may be reasonably requested by the
Administrative Agent, including, without limitation, a copy
of any material debt instrument, material security agreement
or other material contract to which the Borrower or its
Subsidiaries (including TakeCare) may be a party.
(c) Merger Agreement Obligations. The Merger shall
have been consummated in accordance with the terms and
provisions of the Merger Agreement. None of the material
conditions of the obligations of any of the parties to the
Merger Agreement to consummate the Merger shall have been
waived in any material respect by such parties, without
prior written consent of the Required Lenders.
(d) Filing of Certificate of Merger; Consummation of
Merger. The Certificate of Merger with respect to the
Merger shall have been filed with the Secretary of State of
Delaware, and the Merger shall have become effective in
accordance with the laws of the State of Delaware and in
accordance with the Merger Agreement.
(e) Merger Consideration. The Administrative Agent
shall have received, with a copy for each Lender, (i) a
certificate of the Borrower setting forth in reasonable
detail the Merger Consideration, and the amount of each
component thereof, paid in connection with the Merger in
each case to the extent determinable on the Closing Date,
and such amounts shall be consistent in all material
respects with the requirements of the Merger Agreement and
with the information set forth on the Preliminary Pro Forma
Balance Sheet referred to in subsection 3.1 and the
Confidential Information Memorandum referred to in
subsection 3.19 (provided, that certain Indebtedness of
TakeCare and its Subsidiaries which is shown in such
information as being repaid in connection with the Merger
may have been repaid prior to the Merger) and (ii) a
certificate of the Borrower, together with such other
evidence as the Administrative Agent shall reasonably
request, to the effect that no shareholder of TakeCare shall
be entitled to receive Cash Merger Consideration (as defined
in the Merger Agreement) with respect to common stock of
TakeCare held by such shareholder if such shareholder fails
to elect, on or prior to December 15, 1994, to receive Cash
Merger Consideration for such common stock.
(f) Fees. The Lenders shall have received a
certificate of the Borrower setting forth in reasonable
detail the total fees paid or accrued by the Borrower
through the Closing Date in connection with this Agreement,
the Merger and the transactions contemplated hereby, and
such total amount shall not exceed $25,000,000.
(g) Payment of Existing TakeCare Indebtedness. The
Administrative Agent shall have received evidence reasonably
acceptable to the Administrative Agent that all Existing
TakeCare Indebtedness is simultaneously being paid in full.
(h) Financial Statements; Pro Forma Balance Sheets.
(i) The Lenders shall have received (A) the annual
financial statements for TakeCare for the fiscal years ended
on December 31, 1992 and December 31, 1993 (which financial
statements shall in each case be certified by the
independent auditors of TakeCare as presenting fairly the
financial position and operations of TakeCare as at and for
each such period and as having been prepared in accordance
with GAAP) and (B) unaudited statements of income and cash
flow and balance sheet of TakeCare as at the end of each
fiscal quarter ending after December 31, 1993 and more than
45 days prior to the Closing Date (collectively, the
"TakeCare Financial Statements").
(ii) No material adverse change shall have occurred in
the financial condition, business, operations or assets of
TakeCare as reflected in the TakeCare Financial Statements
as at and for the period ended December 31, 1992.
(iii) The Pro Forma Balance Sheet delivered pursuant
to subsection 3.1(c) shall not, in the determination of the
Administrative Agent, differ in any material respect from
the Preliminary Pro Forma Balance Sheet delivered pursuant
to subsection 3.1(b).
(i) Closing Certificate; Corporate Proceedings
Incumbency; Corporate Documents. The Administrative Agent
shall have received, with a counterpart for each Lender, a
Closing Certificate of the Borrower, substantially in the
form of Exhibit G, duly completed and dated the Closing
Date, to which there shall be attached (i) a copy of the
resolutions, in form and substance satisfactory to the
Administrative Agent, of the Board of Directors of the
Borrower authorizing (A) the execution, delivery and
performance of this Agreement, the Notes and the other Loan
Documents and Merger Documents to which it is a party, (B)
the borrowings contemplated hereunder and (C) the Merger and
the other Related Transactions, and (ii) true and complete
copies of the certificate of incorporation and by-laws of
the Borrower, and which shall set forth the names, titles
and signatures of officers of the Borrower authorized to
execute the Loan Documents and the Merger Documents .
(j) Consents, Licenses and Approvals. The
Administrative Agent shall have received, with a counterpart
for each Lender, a certificate of a Responsible Officer of
the Borrower stating that all material consents, licenses
and filings referred to in subsection 3.4 have been obtained
on or prior to the Closing Date and are in full force and
effect.
(k) Litigation. No litigation, investigation or
proceeding of or before any arbitrator or Governmental
Authority including, without limitation, HMO Regulators and
Insurance Regulators, shall be pending or threatened in
respect of the Merger which, in the reasonable judgment of
the Required Lenders, would reasonably be expected to have a
Material Adverse Effect, and no injunction, restraining
order or other order shall be in effect prohibiting the
Merger.
(l) Fees. The Administrative Agent shall have
received the fees to be received on the Closing Date
referred to in subsection 2.4 and any other fees payable to
Chemical on the Closing Date pursuant to the Fee Letter,
dated March 3, 1994, between Chemical and the Borrower, as
amended.
(m) Legal Opinions. The Administrative Agent shall
have received, with a counterpart for each Lender, the
following executed legal opinions:
(i) the executed legal opinions of O'Melveny &
Myers, counsel to the Borrower, and of Delaware counsel
to the Borrower, covering the matters set forth in
Exhibit I; and
(ii) the executed legal opinion of the general
counsel of the Borrower, covering the matters set forth
in Exhibit J.
Each such legal opinion shall cover such other matters
incident to the transactions contemplated by this Agreement
as the Administrative Agent may reasonably require, and may
contain such assumptions, exceptions and qualifications as
are customary in legal opinions in similar transactions.
(n) Additional Matters. All corporate and other
proceedings, and all documents, instruments and other legal
matters in connection with the transactions contemplated by
this Agreement, the other Loan Documents and the Merger
Documents shall be satisfactory in form and substance to the
Administrative Agent, and the Administrative Agent shall
have received such other documents and legal opinions in
respect of any aspect or consequence of the transactions
contemplated hereby or thereby as it shall reasonably
request.
4.2 Conditions to Each Loan. The agreement of each
Lender to make any Loan requested to be made by it on any date
(including, without limitation, its initial Loan) is subject to
the satisfaction of the following conditions precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Borrower in or
pursuant to the Loan Documents shall be true and correct in
all material respects on and as of such date as if made on
and as of such date, except to the extent such
representations and warranties specifically relate to an
earlier date, in which case such representations and
warranties shall have been true and correct in all material
respects on and as of such earlier date.
(b) No Default. No Default or Event of Default shall
have occurred and be continuing on such date or after giving
effect to the Loans requested to be made on such date.
Each borrowing by the Borrower hereunder shall constitute a
representation and warranty by the Borrower as of the date of
such Loan that the conditions contained in paragraphs (a) and (b)
of this subsection 4.2 have been satisfied.
SECTION 5. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as any of the
Commitments remain in effect, any Note remains outstanding and
unpaid (other than any CAF Loan Note which has been Cash
Collateralized) or any other amount (other than any CAF Loan
which has been Cash Collateralized) is owing to any Lender, the
Administrative Agent or the CAF Loan Agent hereunder, the
Borrower shall and (except in the case of delivery of financial
information, reports and notices) shall cause each of its
Subsidiaries to:
5.1 Financial Statements. Furnish to each Lender:
(a) as soon as available, but in any event within
100 days after the end of each fiscal year of the Borrower,
a copy of the consolidated balance sheet of the Borrower and
its consolidated Subsidiaries as at the end of such year and
the related consolidated statements of income and retained
earnings and of cash flows for such year, setting forth in
each case in comparative form the figures for the previous
year, reported on without a "going concern" or like
qualification or exception, or qualification arising out of
the scope of the audit, by Deloitte & Touche or other
independent certified public accountants of nationally
recognized standing; and
(b) as soon as available, but in any event not later
than 55 days after the end of each of the first three
quarterly periods of each fiscal year of the Borrower, the
unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such quarter and
the related unaudited consolidated statements of income and
retained earnings and of cash flows of the Borrower and its
consolidated Subsidiaries for such quarter and the portion
of the fiscal year through the end of such quarter, setting
forth in each case in comparative form the figures for the
previous year, certified by a Responsible Officer as being
fairly stated in all material respects (subject to normal
year-end audit adjustments);
all such financial statements shall be complete and correct in
all material respects and shall be prepared in reasonable detail
and in accordance with GAAP applied consistently throughout the
periods reflected therein and with prior periods (except as
approved by such accountants or officer, as the case may be, and
disclosed therein).
5.2 Certificates; Other Information. Furnish to each
Lender:
(a) concurrently with the delivery of the financial
statements referred to in subsection 5.1(a), a certificate
of the independent certified public accountants reporting on
such financial statements, which certificate shall be in the
form and shall cover the matters customary in such type of
certificates delivered by independent certified public
accountants generally, stating that in making the
examination necessary therefor no knowledge was obtained of
any Default or Event of Default, except as specified in such
certificate;
(b) concurrently with the delivery of the financial
statements referred to in subsections 5.1(a) and 5.1(b), a
certificate of a Responsible Officer (i) stating that such
Officer has obtained no knowledge of any Default or Event of
Default except as specified in such certificate, and (ii)
setting forth calculations demonstrating compliance with
subsections 6.1, 6.2(h), 6.4(g) and 6.7(a) during the period
reflected in such financial statements;
(c) within ten days after the same are sent, copies of
all financial statements and reports which the Borrower
sends to its stockholders, and within five days after the
same are filed, (i) a copy of the Proxy Statement and
Registration Statement in respect of the Merger and the
common stock and Merger Preferred Stock to be issued in
connection therewith, and (ii) copies of all financial
statements and reports which the Borrower may make to, or
file with, the Securities and Exchange Commission or any
successor Governmental Authority; and
(d) promptly, such additional financial and other
information as any Lender may from time to time reasonably
request.
5.3 Payment of Obligations. Pay, discharge or
otherwise satisfy at or before maturity or before they become
delinquent, as the case may be, all its obligations of whatever
nature, except where (a) the amount or validity thereof is
currently being contested in good faith by appropriate
proceedings and reserves in conformity with GAAP with respect
thereto have been provided on the books of the Borrower or its
Subsidiaries, as the case may be or (b) the failure to pay,
discharge or otherwise satisfy could not reasonably be expected
to have a Material Adverse Effect.
5.4 Conduct of Business and Maintenance of Existence.
Continue to engage in business of the same general type as now
conducted by it and preserve, renew and keep in full force and
effect its corporate existence and take all reasonable action to
maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business, in each case if
termination thereof could reasonably be expected to have a
Material Adverse Effect; comply in all material respects with all
material Contractual Obligations and material Requirements of Law
(including, without limitation, the HMO Regulations, Insurance
Regulations and Environmental Laws).
5.5 Maintenance of Property; Insurance. Keep all
property useful and necessary in its business in good working
order and condition; maintain with financially sound and
reputable insurance companies (including any Subsidiary which is
engaged in the business of providing insurance protection)
insurance on all its property in at least such amounts and
against at least such risks (but including in any event general
liability and professional liability insurance against claims for
malpractice) as are consistent with past practices of the
Borrower; maintain adequate reserves in respect of all self-
insurance of the Borrower and its Subsidiaries; and furnish to
each Lender, upon written request, full information as to the
insurance carried.
5.6 Inspection of Property; Books and Records;
Discussions. Keep proper books of records and account in which
true and correct entries in conformity with GAAP and all
Requirements of Law, including, but not limited to, HMO
Regulations and Insurance Regulations, shall be made of all
dealings and transactions in relation to its business and
activities, except to the extent failure to do so could not
reasonably be expected to have a Material Adverse Effect; and
permit representatives of any Lender at the expense of the
Borrower under the circumstances described in subsection 9.5(b)
with respect to Lenders and otherwise at such Lender's expense,
to visit and inspect any of its properties and examine and make
abstracts from any of its books and records, all upon reasonable
notice and at any reasonable time and as often as may reasonably
be desired and, upon such reasonable notice and at any such
reasonable time, to discuss the business, operations, properties
and financial and other condition of the Borrower and its
Subsidiaries with officers and employees of the Borrower and its
Subsidiaries and with its independent certified public
accountants (provided, that the Borrower may, if it so chooses,
be present at or participate in any such discussion).
5.7 Notices. Promptly give notice to the
Administrative Agent and each Lender of:
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any
Contractual Obligation of the Borrower or any of its
Subsidiaries or (ii) litigation, investigation or proceeding
which may exist at any time between the Borrower or any of
its Subsidiaries and any Governmental Authority (including,
without limitation, HMO Regulations and Insurance
Regulators), which in either case could reasonably be
expected to have a Material Adverse Effect;
(c) any litigation or proceeding affecting the
Borrower or any of its Subsidiaries in which the amount
involved is $10,000,000 or more and not covered by insurance
or which seeks injunctive or similar relief which, if
granted, could reasonably be expected to have a Material
Adverse Effect, provided, that, in respect of medical
malpractice litigation or proceedings, the Borrower shall
only be required to give reports to the Lenders quarterly on
the status of the medical malpractice litigation;
(d) the following events, as soon as possible and in
any event within 30 days after the Borrower knows or has
reason to know thereof: (i) the occurrence or expected
occurrence of any Reportable Event with respect to any Plan,
a failure to make any required contribution to a Plan, the
creation of any Lien in favor of the PBGC or a Plan or any
withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the
institution of proceedings or the taking of any other action
by the PBGC or the Borrower or any Commonly Controlled
Entity or any Multiemployer Plan with respect to the
withdrawal from, or the terminating, Reorganization or
Insolvency of, any Single Employer Plan or any Multiemployer
Plan;
(e) any development or event which could reasonably be
expected to have a Material Adverse Effect;
(f) the revocation by any Governmental Authority,
including, without limitation, the HMO Regulators and
Insurance Regulators of any material license, permit,
authorization, certificate, qualification or accreditation
of the Borrower or any Subsidiary, the revocation of which
could reasonably be expected to have a Material Adverse
Effect; and
(g) any significant change in or material additional
restriction placed on the ability of any Subsidiary to
continue business as usual, including, without limitation,
its ability to pay dividends to the Borrower, by any
Governmental Authority, including, without limitation, the
HMO Regulators and Insurance Regulators, in any case, if any
such change or restriction could reasonably be expected to
result in a Material Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a
statement of a Responsible Officer setting forth details of the
occurrence referred to therein and stating what action the
Borrower proposes to take with respect thereto.
5.8 Maintenance of Accreditation, Etc. Preserve and
maintain, and cause each of its Subsidiaries to preserve and
maintain, all licenses, permits, authorizations, certifications
and qualifications (including, without limitation, those
qualifications with respect to solvency and capitalization)
required under the HMO Regulations or the Insurance Regulations
in connection with the ownership or operation of HMO's or
insurance companies, in each case, if the termination thereof
could reasonably be expected to result in a Material Adverse
Effect.
5.9 Environmental Laws. (a) Comply with, and ensure
compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply in all
material respects with and maintain, and ensure that all tenants
and subtenants obtain and comply in all material respects with
and maintain, any and all licenses, approvals, notifications,
registrations or permits required by applicable Environmental
Laws except to the extent that failure to do so could not be
reasonably expected to have a Material Adverse Effect.
(b) Conduct and complete all investigations, studies,
sampling and testing, and all remedial, removal and other actions
required under Environmental Laws and promptly comply in all
material respects with all lawful orders and directives of all
Governmental Authorities regarding Environmental Laws except to
the extent that the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings
could not be reasonably expected to have a Material Adverse
Effect.
SECTION 6. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the
Commitments remain in effect, any Note remains outstanding and
unpaid (other than any CAF Loan Note which has been Cash
Collateralized) or any other amount (other than any CAF Loan
which has been Cash Collateralized) is owing to any Lender, the
Administrative Agent or the CAF Loan Agent hereunder, the
Borrower shall not, and (except with respect to subsection 6.1)
shall not permit any of its Subsidiaries to, directly or
indirectly:
6.1 Financial Condition Covenants.
(a) Maintenance of Net Worth. Permit Consolidated Net
Worth on the Closing Date (after giving effect to the Merger
and the Related Transactions) and at any other date of
determination thereof after the Closing Date, to be less
than (i) the amount shown for Consolidated Net Worth on the
Preliminary Pro Forma Balance Sheet delivered pursuant to
subsection 3.1(b), minus (ii) $50,000,000, minus (iii) the
aggregate amount of reserves charged to stockholders' equity
with respect to the Merger in an aggregate amount not
exceeding $15,000,000, plus (iv) 50% of Cumulative
Consolidated Net Income to such date of determination.
(b) Consolidated Total Debt to Capital Funds. Permit
the ratio of Consolidated Total Debt to Consolidated Capital
Funds as of the last day of any fiscal quarter to be greater
than .35 to 1.00.
(c) Fixed Charge Coverage. Permit the ratio of
Consolidated Adjusted Net Income (without deduction for any
reserves described in clause (iii) of subsection 6.1(a), to
the extent the same would otherwise be deducted in computing
Consolidated Adjusted Net Income) to Consolidated Adjusted
Fixed Charges for any period of four consecutive fiscal
quarters to be less than 3.00 to 1.00.
6.2 Limitation on Subsidiary Indebtedness. Permit any
Subsidiary to create, incur, assume or suffer to exist any
Indebtedness or Guarantee Obligations of such Subsidiary, except:
(a) Indebtedness or Guarantee Obligations outstanding
on the date of this Agreement, each item of which that is in
an amount of $1,000,000 or greater is shown on Schedule IV;
(b) Indebtedness or Guarantee Obligations of any
Person existing at the time such Person becomes a
Subsidiary;
(c) Indebtedness or Guarantee Obligations of a
Subsidiary in respect of performance, surety and other
similar bonds, bankers' acceptances and letters of credit
provided by such Subsidiary in the ordinary course of
business;
(d) Indebtedness or Guarantee Obligations of a
Subsidiary arising from agreements providing for
indemnification, adjustment of purchase price or similar
obligations or from guarantees, letters of credit, surety
bonds or performance bonds securing any obligations of the
Borrower or any of its Subsidiaries incurred or assumed in
connection with the disposition of any business, Property or
Subsidiary, other than guarantees or similar credit support
by any Subsidiary of Indebtedness or Guarantee Obligations
incurred by any Person acquiring all or any portion of such
business, Property or Subsidiary for the purpose of
financing such acquisition; provided that the maximum
aggregate liability in respect of all such Guarantee
Obligations will at no time exceed the gross proceeds
(including cash and the Fair Market Value of Property other
than cash) actually received from the disposition of such
business, Property or Subsidiary;
(e) Permitted Subsidiary Refinancing Indebtedness;
(f) Indebtedness or Guarantee Obligations of a
Subsidiary to the Borrower or another Subsidiary;
(g) Any obligation pursuant to a Sale and Lease-Back
Transaction permitted under subsection 6.3(b) or (c); and
(h) Additional Indebtedness and Guarantee Obligations
in an amount which, together with the Value of all Sale and
Lease-Back Transactions entered into by Subsidiaries
pursuant to subsection 6.3(a) which, if structured as
mortgages rather than Sale and Lease-Back Transactions,
would not otherwise be permitted by clauses (a) through (g)
of this subsection 6.2, does not exceed $55,000,000 in the
aggregate for all Subsidiaries at any time outstanding.
6.3 Limitation on Sale and Lease-Back Transactions.
Directly or indirectly, enter into, assume, guarantee, or
otherwise become liable with respect to any Sale and Lease-Back
Transaction; provided, however, that the Borrower or any
Subsidiary may enter into:
(a) a Sale and Lease-Back Transaction that, had such
Sale and Lease-Back Transaction been structured as a
mortgage rather than as a Sale and Lease-Back Transaction,
the Borrower or such Subsidiary would have been permitted to
enter into such transaction pursuant to subsections 6.2 and
6.4;
(b) a Sale and Lease-Back Transaction between or among
the Borrower and any of its Subsidiaries or between or among
Subsidiaries; and
(c) a Sale and Lease-Back Transaction, provided that,
within 180 days of the effective date of any such Sale and
Lease-Back Transaction, the Borrower or such Subsidiary
shall apply an amount equal to the Value of such Sale and
Lease-Back Transaction to (1) prepayment of the Term Loans
or (2) the purchase or construction of other property,
provided that such property is owned by the Borrower or a
Subsidiary free and clear of all Liens.
6.4 Limitation on Liens. Directly or indirectly,
create, incur, assume or permit to exist, or permit any
Subsidiary to create, incur, assume or permit to exist, any Lien
on or with respect to any Property of the Borrower or such
Subsidiary or any interest therein or any income or profits
therefrom, except for:
(a) any Lien securing Indebtedness or Guarantee
Obligations incurred to finance the purchase price or cost
of construction of Property (or additions, substantial
repairs, alterations or substantial improvements thereto),
provided that such Lien and the Indebtedness or Guarantee
Obligations secured thereby are incurred within one year of
the later of acquisition or completion of construction (or
addition, repair, alteration or improvement) and full
operation thereof, and provided further, that such Lien does
not relate to any Property acquired or constructed by the
Borrower or a Subsidiary pursuant to clause (c)(2) of
subsection 6.3;
(b) any Lien on Property acquired by Borrower or any
Subsidiary after the date of this Agreement, provided that
such Lien existed on the date such Property was acquired and
was not incurred in anticipation thereof;
(c) any Lien existing on the date of this Agreement,
and any Lien on cash or securities securing a Cash
Collateralized CAF Loan;
(d) any Lien arising out of judgments or awards against
the Borrower or any Subsidiary with respect to which the
Borrower or such Subsidiary shall in good faith be
prosecuting an appeal or proceedings for review, Liens which
are discharged within 60 days of entry of judgment or Liens
(including, without limitation, appellate bonds) incurred by
the Borrower or a Subsidiary for the purpose of obtaining a
stay or discharge in the course of any ongoing legal
proceeding to which the Borrower or such Subsidiary is a
party;
(e) any Lien for taxes not yet due and payable by the
Borrower or any Subsidiary or which the Borrower or such
Subsidiary is contesting in good faith;
(f) any Lien on or with respect to Property of a
Subsidiary in favor of the Borrower or another Subsidiary;
(g) any Lien (other than a Lien permitted under any of
clauses (a) through (f) of this subsection 6.4) securing
Indebtedness or Guarantee Obligations of the Borrower or of
any Subsidiary which may be incurred under subsection 6.2,
provided that the total outstanding Indebtedness or
Guarantee Obligations (including the Value of all Sale and
Lease-Back Transactions permitted under clause (a) of
subsection 6.3 but excluding any obligations associated with
such Sale and Lease-Back Transactions) that may be secured
under this clause (g) may not exceed the greater of (1) 10%
of Consolidated Net Tangible Assets at the end of the most
recent fiscal quarter and (2) $55,000,000;
(h) any Lien extending, renewing or replacing any Lien
permitted by clauses (a) through (g) above; and
(i) Permitted Ordinary Course Liens not securing
indebtedness for borrowed money.
In the case of Liens permitted under clauses (a) and
(b), such Liens may not relate to any Property of the
Borrower or a Subsidiary other than the property so
acquired, constructed, repaired, altered or improved, as the
case may be. In the case of Liens permitted under clause
(h), such Liens (A) may not relate to any Property of the
Company or a Subsidiary other than the Property to which the
Lien being extended, renewed or replaced relates, and (B)
may not secure Indebtedness or Guarantee Obligations in
excess of that secured by the Lien being extended, renewed
or replaced.
6.5 Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries. The Borrower shall not, and
shall not permit any Subsidiary to, suffer to exist any
encumbrance or restriction (other than pursuant to law,
regulation or order) on the ability of any Subsidiary (i) to pay,
directly or indirectly, dividends or make any other distributions
in respect of its Capital Stock or pay any Indebtedness or other
obligation owed to the Borrower or any other Subsidiary; (ii) to
make loans or advances to the Borrower or any Subsidiary; or
(iii) to transfer any of its Property or assets to the Borrower
or any Subsidiary, except any encumbrance or restriction (a)
pursuant to any agreement in effect on the date hereof, (b)
pursuant to an agreement entered into by such Subsidiary prior to
the date on which such Subsidiary was acquired by the Borrower
and not entered into in anticipation of becoming a Subsidiary,
(c) pursuant to an agreement effecting a renewal, extension,
refinancing or refunding of Indebtedness incurred pursuant to an
agreement referred to in clause (a) or (b) above; provided,
however, that the provisions contained in such renewal,
extension, refinancing or refunding agreement relating to such
encumbrance or restriction are no more restrictive in any
material respect than the provisions contained in the agreement
the subject thereof, or (d) that is not more restrictive or
burdensome than the Federal or state laws, rules or regulations
applicable to such Subsidiary.
6.6 Limitation on Fundamental Changes. Enter into any
merger, consolidation or amalgamation, or liquidate, wind up or
dissolve itself (or suffer any liquidation or dissolution), or
convey, sell, lease, assign, transfer or otherwise dispose of,
all or substantially all of its property, business or assets,
except:
(a) any Subsidiary of the Borrower may be merged or
consolidated with or into the Borrower (provided that the
Borrower shall be the continuing or surviving corporation)
or with or into any one or more wholly owned Subsidiaries of
the Borrower (provided that one or more of such wholly owned
Subsidiaries shall be the continuing or surviving
corporation);
(b) any wholly owned Subsidiary may sell, lease,
transfer or otherwise dispose of any or all of its assets
(upon voluntary liquidation or otherwise) to the Borrower or
any other wholly owned Subsidiary of the Borrower;
(c) the Borrower may merge with another Person if,
after giving effect thereto, (i) no Default or Event of
Default shall have occurred, (ii) the continuing or
surviving corporation shall be organized under the laws of a
state of the United States and (iii) the continuing or
surviving corporation, if not the Borrower, shall expressly
assume the Borrower's obligations under this Agreement;
(d) Merger Sub may merge with TakeCare pursuant to the
Merger Agreement; and
(e) the Borrower and its Subsidiaries may make Asset
Sales to the extent permitted by subsection 6.7.
6.7 Limitation on Sale of Assets. Convey, sell,
lease, assign, transfer or otherwise dispose of any of its
property, business or assets (including, without limitation,
receivables and leasehold interests), whether now owned or
hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary's Capital Stock, in each case
to any Person other than the Borrower or any wholly owned
Subsidiary, except:
(a) so long as no Default or Event of Default shall
have occurred and be continuing or would result therefrom,
the Borrower and its Subsidiaries may consummate Asset Sales
for Fair Market Value (i) for Net Cash Proceeds of less than
or equal to $75,000,000 in the aggregate in any fiscal year
or (ii) for Net Cash Proceeds greater than $75,000,000 in
the aggregate in any fiscal year, if such Net Cash Proceeds
in excess of $75,000,000 in any fiscal year are applied to
prepay the Loans pursuant to subsection 2.6(c);
(b) as permitted by subsection 6.6(b); and
(c) in the case of any Subsidiary created after the
date hereof, issuance or sale of shares of such Subsidiary's
Capital Stock to directors of such Subsidiary as director's
qualifying shares to the extent required by applicable law.
6.8 Limitation on Dividends. Declare or pay any
dividend (other than dividends payable solely in common stock or
Preferred Stock of the Borrower) on, or make any payment on
account of, or set apart assets for a sinking or other analogous
fund for, the purchase, redemption, defeasance, retirement or
other acquisition of, any shares of any class of Capital Stock
(including, without limitation, preferred stock) of the Borrower
or any warrants or options to purchase any such Capital Stock,
whether now or hereafter outstanding, or make any other
distribution in respect thereof, either directly or indirectly,
whether in cash or property or in obligations of the Borrower or
any Subsidiary, except that, so long as no Event of Default has
occurred and is continuing, or would be continuing after giving
effect thereto:
(a) the Borrower may pay dividends on the Merger
Preferred Stock; and
(b) the Borrower may redeem, at a price not exceeding
the stated value thereof, the Non-Convertible Merger
Preferred Stock.
In addition, so long as no Event of Default has occurred and is
continuing, or would be continuing after giving effect thereto,
the Borrower may pay dividends on, or may redeem, its common
stock and Preferred Stock, provided, that the total cash amount
of all such dividends and redemptions in any fiscal quarter (the
"Payment Quarter") does not exceed (i) 50% of Consolidated Net
Income of the Borrower and its consolidated Subsidiaries for the
period of four consecutive fiscal quarters ended immediately
prior to the Payment Quarter (such period of four quarters being
the "Calculation Period" in respect of such Payment Quarter),
less (ii) the cash amount of all dividends paid and redemptions
made by the Borrower during such Calculation Period in respect of
common stock and Preferred Stock (including, without limitation,
dividends and redemptions during such Calculation Period pursuant
to paragraphs (a) and (b) above).
6.9 Limitation on Transactions with Affiliates. Enter
into any transaction, including, without limitation, any
purchase, sale, lease or exchange of property or the rendering of
any service, with any Affiliate unless such transaction is
(a) otherwise not prohibited under this Agreement, and (b) upon
fair and reasonable terms no less favorable to the Borrower or
such Subsidiary, as the case may be, than it would obtain at the
time in a comparable arm's length transaction with a Person which
is not an Affiliate; provided that the foregoing restrictions
shall not apply to (i) any transaction between the Borrower and
any of its Subsidiaries or between any of its Subsidiaries or
(ii) reasonable and customary fees paid to members of the board
of directors of the Borrower and its Subsidiaries.
SECTION 7. EVENTS OF DEFAULT
If any of the following events shall occur and be
continuing:
(a) The Borrower shall fail to pay any principal of
any Note when due in accordance with the terms thereof or
hereof; or the Borrower shall fail to pay any interest on
any Note, or any fees payable under subsection 2.4, within
five days after any such interest or such fees become due in
accordance with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made
by the Borrower herein or which is contained in any
certificate, document or financial or other statement
furnished by it at any time under or in connection with this
Agreement shall prove to have been incorrect in any material
respect on or as of the date made or deemed made; or
(c) The Borrower shall default in the observance or
performance of any agreement contained in Section 6 (other
than subsections 6.5 and 6.9); or
(d) The Borrower shall default in the observance or
performance of any other agreement contained in this
Agreement (other than as provided in paragraphs (a) through
(c) of this Section), and such default shall continue
unremedied for a period of 30 days after the Administrative
Agent has delivered notice thereof to the Borrower; or
(e) The Borrower or any of its Subsidiaries shall
(i) default in any payment of principal of or interest of
any Indebtedness (other than the Notes) in an amount of
$10,000,000 or more or in the payment of any Guarantee
Obligation in an amount of $10,000,000 or more, beyond the
period of grace, if any, provided in the instrument or
agreement under which such Indebtedness or Guarantee
Obligation was created; or (ii) default in the observance or
performance of any other agreement or condition relating to
any such Indebtedness or such Guarantee Obligation or
contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur
or condition exist, the effect of which default or other
event or condition is to cause, or to permit the holder or
holders of such Indebtedness or beneficiary or beneficiaries
of such Guarantee Obligation (or a trustee or agent on
behalf of such holder or holders or beneficiary or
beneficiaries) to cause such Indebtedness to become due
prior to its stated maturity or such Guarantee Obligation to
become payable, in each case after the end of any grace
period provided therefor; or
(f) (i) The Borrower or any of its Material
Subsidiaries shall commence any case, proceeding or other
action (A) under any existing or future law of any
jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to
have an order for relief entered with respect to it, or
seeking to adjudicate it a bankrupt or insolvent, or seeking
reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with
respect to it or its debts, or (B) seeking appointment of a
receiver, trustee, custodian, conservator or other similar
official for it or for all or substantially all of its
assets, or the Borrower or any of its Material Subsidiaries
shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the
Borrower or any of its Material Subsidiaries any case,
proceeding or other action of a nature referred to in clause
(i) above which (A) results in the entry of an order for
relief or any such adjudication or appointment or (B)
remains undismissed, undischarged or unbonded for a period
of 60 days; or (iii) there shall be commenced against the
Borrower or any of its Material Subsidiaries any case,
proceeding or other action seeking issuance of a warrant of
attachment, execution, distraint or similar process against
all or substantially all of its assets which results in the
entry of an order for any such relief which shall not have
been vacated, discharged, or stayed or bonded pending appeal
within 60 days from the entry thereof; or (iv) the Borrower
or any of its Material Subsidiaries shall generally not, or
shall be unable to, or shall admit in writing its inability
to, pay its debts as they become due; or
(g) (i) Any Person shall engage in any "prohibited
transaction" (as defined in Section 406 of ERISA or
Section 4975 of the Code) involving any Plan, (ii) any
"accumulated funding deficiency" (as defined in Section 302
of ERISA), whether or not waived, shall exist with respect
to any Plan or any Lien in favor of the PBGC or a Plan shall
arise on the assets of the Borrower or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or
to terminate, any Single Employer Plan, which Reportable
Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required
Lenders, likely to result in the termination of such Plan
for purposes of Title IV of ERISA, (iv) any Single Employer
Plan shall terminate for purposes of Title IV of ERISA,
(v) the Borrower or any Commonly Controlled Entity shall, or
in the reasonable opinion of the Required Lenders is likely
to, incur any liability in connection with a withdrawal
from, or the Insolvency or Reorganization of, a
Multiemployer Plan or (vi) any other event or condition
shall occur or exist with respect to a Plan; and in each
case in clauses (i) through (vi) above, such event or
condition, together with all other such events or
conditions, if any, could reasonably be expected to have a
Material Adverse Effect; or
(h) One or more judgments or decrees shall be entered
against the Borrower or any of its Subsidiaries involving in
the aggregate a liability (to the extent not paid or covered
by insurance) of $10,000,000 or more, and shall not have
been vacated, discharged, stayed or bonded pending appeal
within 60 days from the entry thereof; or
(i) (1) Any non-compliance by the Borrower or any
Subsidiary with any term or provision of the HMO Regulations
or Insurance Regulations pertaining to fiscal soundness,
solvency or financial condition to the extent such non-
compliance individually or in the aggregate would reasonably
be expected to have a Material Adverse Effect; or (2) the
initiation by an HMO Regulator or Insurance Regulator of an
administrative action against the Borrower or any Subsidiary
to revoke or modify any contract of insurance, license,
permit, certification, authorization, accreditation or
charter, the revocation or modification of which would,
individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect;
then, and in any such event, (A) if such event is an Event of
Default specified in clause (i) or (ii) of paragraph (f) above
with respect to the Borrower, automatically the Commitments shall
immediately terminate and the Loans hereunder (with accrued
interest thereon) and all other amounts owing under this
Agreement and the Notes shall immediately become due and payable,
and (B) if such event is any other Event of Default, either or
both of the following actions may be taken: (i) with the consent
of the Required Lenders, the Administrative Agent may, or upon
the request of the Required Lenders, the Administrative Agent
shall, by notice to the Borrower declare the Commitments to be
terminated forthwith, whereupon the Commitments shall immediately
terminate; and (ii) with the consent of the Required Lenders, the
Administrative Agent may, or upon the request of the Required
Lenders, the Administrative Agent shall, by notice to the
Borrower, declare the Loans hereunder (with accrued interest
thereon) and all other amounts owing under this Agreement and the
Notes to be due and payable forthwith, whereupon the same shall
immediately become due and payable. Except as expressly provided
above in this Section, presentment, demand, protest and all other
notices of any kind are hereby expressly waived.
SECTION 8. THE ADMINISTRATIVE AGENT, THE CAF
LOAN AGENT AND THE ARRANGER
8.1 Appointment. Each Lender hereby irrevocably
designates and appoints Chemical as the Administrative Agent and
CAF Loan Agent of such Lender under this Agreement and the other
Loan Documents, and each Lender irrevocably authorizes Chemical,
as the Administrative Agent and CAF Loan Agent, in each such
capacity, to take such action on its behalf under the provisions
of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to
the Administrative Agent or CAF Loan Agent, as the case may be,
by the terms of this Agreement and the other Loan Documents,
together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere
in this Agreement, neither the Administrative Agent nor the CAF
Loan Agent shall have any duties or responsibilities, except
those expressly set forth herein, or any fiduciary relationship
with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be
read into this Agreement or any other Loan Document or otherwise
exist against the Administrative Agent or the CAF Loan Agent.
8.2 Delegation of Duties. The Administrative Agent or
the CAF Loan Agent may execute any of its duties under this
Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. Neither the
Administrative Agent nor the CAF Loan Agent shall be responsible
for the negligence or misconduct of any agents or attorneys-in-
fact selected by it with reasonable care (it being understood
that, for purposes of this sentence, employees and officers of
the Administrative Agent or the CAF Loan Agent are not its
"agents" or "attorneys-in-fact").
8.3 Exculpatory Provisions. Neither the
Administrative Agent nor the CAF Loan Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or
Affiliates shall be (i) liable for any action lawfully taken or
omitted to be taken by it or such Person under or in connection
with this Agreement or any other Loan Document (except for its or
such Person's own gross negligence or willful misconduct) or (ii)
responsible in any manner to any of the Lenders for any recitals,
statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or any other Loan
Document or in any certificate, report, statement or other
document referred to or provided for in, or received by the
Administrative Agent or the CAF Loan Agent under or in connection
with, this Agreement or any other Loan Document or for the value,
validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or the Notes or any other Loan
Document or for any failure of the Borrower to perform its
obligations hereunder or thereunder. Neither the Administrative
Agent nor the CAF Loan Agent shall be under any obligation to any
Lender to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the
properties, books or records of the Borrower.
8.4 Reliance by Administrative Agent and the CAF Loan
Agent. The Administrative Agent and the CAF Loan Agent shall be
entitled to rely, and shall be fully protected in relying, upon
any Note, writing, resolution, notice, consent, certificate,
affidavit, letter, telecopy, telex or teletype message,
statement, order or other document or conversation believed by it
to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of
legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by
the Administrative Agent or the CAF Loan Agent. The
Administrative Agent and the CAF Loan Agent may deem and treat
the payee of any Note as the owner thereof for all purposes
unless a written notice of assignment, negotiation or transfer
thereof shall have been filed with the Administrative Agent or
the CAF Loan Agent. The Administrative Agent and the CAF Loan
Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Required
Lenders as it deems appropriate or it shall first be indemnified
to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Administrative Agent and
the CAF Loan Agent shall in all cases be fully protected in
acting, or in refraining from acting, under this Agreement and
the Notes and the other Loan Documents in accordance with a
request of the Required Lenders, and such request and any action
taken or failure to act pursuant thereto shall be binding upon
all the Lenders and all future holders of the Notes.
8.5 Notice of Default. Neither the Administrative
Agent or the CAF Loan Agent shall be deemed to have knowledge or
notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent or the CAF Loan Agent
has received notice from a Lender or the Borrower referring to
this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event
that the Administrative Agent or the CAF Loan Agent receives such
a notice, the Administrative Agent or the CAF Loan Agent shall
give notice thereof to the Lenders. The Administrative Agent or
the CAF Loan Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by
the Required Lenders; provided that unless and until the
Administrative Agent or the CAF Loan Agent shall have received
such directions, the Administrative Agent or the CAF Loan Agent
may (but shall not be obligated to) take such action, or refrain
from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the
Lenders.
8.6 Non-Reliance on Administrative Agent, CAF Loan
Agent and Other Lenders. Each Lender expressly acknowledges that
neither the Administrative Agent nor the CAF Loan Agent nor any
of its officers, directors, employees, agents, attorneys-in-fact
or Affiliates has made any representations or warranties to it
and that no act by the Administrative Agent or the CAF Loan Agent
hereinafter taken, including any review of the affairs of the
Borrower, shall be deemed to constitute any representation or
warranty by the Administrative Agent or the CAF Loan Agent to any
Lender. Each Lender represents to the Administrative Agent and
the CAF Loan Agent that it has, independently and without
reliance upon the Administrative Agent or the CAF Loan Agent or
any other Lender, and based on such documents and information as
it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial
and other condition and creditworthiness of the Borrower and made
its own decision to make its Loans hereunder and enter into this
Agreement. Each Lender also represents that it will,
independently and without reliance upon the Administrative Agent
or the CAF Loan Agent or any other Lender, and based on such
documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and
decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it
deems necessary to inform itself as to the business, operations,
property, financial and other condition and creditworthiness of
the Borrower. Except for notices, reports and other documents
expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, neither the Administrative Agent
nor the CAF Loan Agent shall have any duty or responsibility to
provide any Lender with any credit or other information
concerning the business, operations, property, condition
(financial or otherwise), prospects or creditworthiness of the
Borrower which may come into the possession of the Administrative
Agent or the CAF Loan Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates.
8.7 Indemnification. The Lenders agree to indemnify
each of the Administrative Agent and the CAF Loan Agent in its
capacity as such (to the extent not reimbursed by the Borrower
and without limiting the obligation of the Borrower to do so),
ratably according to their respective Commitment Percentages in
effect on the date on which indemnification is sought under this
subsection (or, if indemnification is sought after the date upon
which the Commitments shall have terminated and the Loans shall
have been paid in full, ratably in accordance with their
Commitment Percentages immediately prior to such date), from and
against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment
of the Notes) be imposed on, incurred by or asserted against the
Administrative Agent or the CAF Loan Agent in any way relating to
or arising out of, the Commitments, this Agreement, any of the
other Loan Documents or any documents contemplated by or referred
to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Administrative
Agent or the CAF Loan Agent under or in connection with any of
the foregoing; provided that no Lender shall be liable for the
payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting solely from the Administrative Agent's or
the CAF Loan Agent's, as applicable, gross negligence or willful
misconduct or any expenses in connection with the development,
preparation and execution of this Agreement and the Notes and the
closing hereunder which exceed the amount agreed in writing on
March 3, 1994 by the Borrower and the Administrative Agent. The
agreements in this subsection shall survive the payment of the
Notes and all other amounts payable hereunder.
8.8 Administrative Agent and CAF Loan Agent in
Individual Capacity. Each of the Administrative Agent and the
CAF Loan Agent and its respective Affiliates may make loans to,
accept deposits from and generally engage in any kind of business
with the Borrower as though the Administrative Agent or the CAF
Loan Agent were not the Administrative Agent or the CAF Loan
Agent, as applicable, hereunder and under the other Loan
Documents. With respect to its loans made or renewed by it and
any Note issued to it, each of the Administrative Agent and the
CAF Loan Agent shall have the same rights and powers under this
Agreement and the other Loan Documents as any Lender and may
exercise the same as though it were not the Administrative Agent
or the CAF Loan Agent, as applicable, and the terms "Lender" and
"Lenders" shall include each of the Administrative Agent and the
CAF Loan Agent in its individual capacity.
8.9 Successor Administrative Agent and CAF Loan Agent.
Each of the Administrative Agent and the CAF Loan Agent may
resign as Administrative Agent or CAF Loan Agent, as applicable,
upon 30 days' notice to the Borrower and the Lenders. If the
Administrative Agent or the CAF Loan Agent shall resign as
Administrative Agent or CAF Loan Agent under this Agreement and
the other Loan Documents, then the Required Lenders shall appoint
from among the Lenders a successor agent for the Lenders, which
successor agent shall be approved by the Borrower, whereupon such
successor agent shall succeed to the rights, powers and duties of
the Administrative Agent or CAF Loan Agent, as applicable, and
the term "Administrative Agent" or "CAF Loan Agent", as
applicable, shall mean such successor agent effective upon such
appointment and approval, and the former Administrative Agent's
or CAF Loan Agent's rights, powers and duties as Administrative
Agent or CAF Loan Agent shall be terminated, without any other or
further act or deed on the part of such former Administrative
Agent or CAF Loan Agent or any of the parties to this Agreement
or any holders of the Notes. After any retiring Administrative
Agent's or CAF Loan Agent's resignation as Administrative Agent
or CAF Loan Agent, the provisions of this Section 8 shall inure
to its benefit as to any actions taken or omitted to be taken by
it while it was Administrative Agent or CAF Loan Agent under this
Agreement and the other Loan Documents.
8.10 The Arranger. The Arranger shall have no duties
or responsibilities under this Agreement and the other Loan
Documents and shall incur no liability hereunder or thereunder.
SECTION 9. MISCELLANEOUS
9.1 Amendments and Waivers. Neither this Agreement
nor any Note, nor any terms hereof or thereof may be amended,
supplemented or modified except in accordance with the provisions
of this subsection. The Required Lenders may, or, with the
written consent of the Required Lenders, the Administrative Agent
may, from time to time, (a) enter into with the Borrower written
amendments, supplements or modifications hereto and to the Notes
for the purpose of adding any provisions to this Agreement or the
Notes or changing in any manner the rights of the Lenders or of
the Borrower hereunder or thereunder or (b) waive, on such terms
and conditions as the Required Lenders or the Administrative
Agent, as the case may be, may specify in such instrument, any of
the requirements of this Agreement, the Notes or the other Loan
Documents or any Default or Event of Default and its
consequences; provided, however, that no such waiver and no such
amendment, supplement or modification shall (i) reduce the amount
or extend the scheduled date of final maturity of any Note, or
reduce the stated rate of any interest or fee payable hereunder
or extend the scheduled date of any payment of interest or fees
payable hereunder or increase the aggregate amount or extend the
expiration date of any Lender's Commitments, in each case without
the consent of each Lender affected thereby, or extend the
scheduled maturity date of any installment of any Note (other
than the final maturity date) without the consent of Lenders
whose Exposure comprises at least 80% of the Exposure of all the
Lenders, or (ii) amend, modify or waive any provision of this
subsection or reduce the percentage specified in the definition
of Required Lenders, or consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this
Agreement and the other Loan Documents, in each case without the
written consent of all the Lenders, or (iii) amend, modify or
waive any provision of Section 8 without the written consent of
the then Administrative Agent and CAF Loan Agent. Any such
waiver and any such amendment, supplement or modification shall
apply equally to each of the Lenders and shall be binding upon
the Borrower, the Lenders, the Administrative Agent and CAF Loan
Agent and all future holders of the Notes. In the case of any
waiver, the Borrower, the Lenders, the Administrative Agent and
CAF Loan Agent shall be restored to their former position and
rights hereunder and under the outstanding Notes, and any Default
or Event of Default waived shall be deemed to be cured and not
continuing; but no such waiver shall extend to any subsequent or
other Default or Event of Default, or impair any right consequent
thereon.
9.2 Notices. All notices, requests and demands to or
upon the respective parties hereto to be effective shall be in
writing (including by telecopy), and, unless otherwise expressly
provided herein, shall be deemed to have been duly given or made
when delivered, or 3 days after being deposited in the mail,
postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower, the
Administrative Agent and the CAF Loan Agent, and as set forth in
Schedule I in the case of the other parties hereto, or to such
other address as may be hereafter notified by the respective
parties hereto and any future holders of the Notes:
The Borrower: FHP International Corporation
9900 Talbert Avenue
Fountain Valley, California 92708
Attention: Treasurer
Telecopy: 714-378-5448
with a copy to: FHP International Corporation
9900 Talbert Avenue
Fountain Valley, California 92708
Attention: General Counsel
Telecopy: 714-378-5049
The Administrative Chemical Bank
Agent and CAF 270 Park Avenue
Loan Agent: New York, New York 10017
Attention: Mr. Peter Eckstein
Telecopy: (212) 972-0009
With a copy to: Chemical Bank Agency Services
Corporation
140 East 45th Street
New York, New York 10017
Attention: Janet Belden,
Vice President
Telecopy: (212) 622-0854
provided that any notice, request or demand to or upon the
Administrative Agent, the CAF Loan Agent or the Lenders pursuant
to subsection 2.1(d), 2.2(d), 2.3(b), 2.5, 2.6, 2.7 or 2.12 shall
not be effective until received.
9.3 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the
Administrative Agent, the CAF Loan Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other
Loan Documents shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein
provided are cumulative and not exclusive of any rights,
remedies, powers and privileges provided by law.
9.4 Survival of Representations and Warranties. All
representations and warranties made hereunder, in the other Loan
Documents and in any document, certificate or statement delivered
pursuant hereto or in connection herewith shall survive the
execution and delivery of this Agreement and the Notes and the
making of the Loans hereunder.
9.5 Payment of Expenses and Taxes. The Borrower
agrees (a) to pay or reimburse the Administrative Agent and the
CAF Loan Agent for all its actual and reasonable out-of-pocket
costs and expenses incurred in connection with the development,
preparation and execution of, and any amendment, supplement or
modification to, this Agreement and the Notes and any other
documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated
hereby and thereby, including, without limitation, the reasonable
fees and disbursements of counsel to the Administrative Agent and
the CAF Loan Agent (which shall not exceed, in connection with
the development, preparation and execution of this Agreement and
the Notes and the closing hereunder, the amount agreed in writing
on March 3, 1994 by the Borrower and the Administrative Agent
plus reasonable disbursement charges) in connection with the
consummation of the transactions contemplated hereby, (b) to pay
or reimburse the Administrative Agent and the CAF Loan Agent and,
after the occurrence and during the continuance of an Event of
Default, each Lender, for all its reasonable costs and expenses
incurred in connection with the enforcement or preservation of
any rights under this Agreement or the Notes and any such other
documents, including, without limitation, the reasonable fees and
disbursements of counsel (including the allocated fees and
expenses of in-house counsel) to each Lender and of counsel to
the Administrative Agent and the CAF Loan Agent and (c) to pay,
indemnify, and hold each Lender and the Administrative Agent
harmless from and against any and all other liabilities,
obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement,
performance and administration of this Agreement, the Notes, the
other Loan Documents, the Merger Documents, the Merger or the use
of the proceeds of the Loans in connection with the Merger and
any such other documents, including, without limitation, any of
the foregoing relating to the violation of, noncompliance with or
liability under, any Environmental Law applicable to the
operations of the Borrower, any of its Subsidiaries or any of the
Properties (all the foregoing in this clause (c), collectively,
the "indemnified liabilities"), provided, that the Borrower shall
have no obligation hereunder to the Administrative Agent, the CAF
Agent or any Lender with respect to indemnified liabilities
arising from (i) the gross negligence or willful misconduct of
the Administrative Agent or CAF Agent or any such Lender, (ii)
legal proceedings commenced against the Administrative Agent or
CAF Agent or any such Lender by any security holder or creditor
thereof arising out of and based upon rights afforded any such
security holder or creditor solely in its capacity as such or
(iii) legal proceedings commenced by any Lender against another
Lender in its capacity as such, and the Borrower shall have no
obligation to indemnify any Lender, in its capacity as such, for
indemnified liabilities of such Lender in connection with any
legal proceedings commenced by such Lender against the
Administrative Agent or the CAF Loan Agent. Each indemnified
Person shall notify the Borrower of any such indemnified
liability, within a reasonable period of time although failure to
give such notice shall not relieve the Borrower of its
obligations with respect thereto. The Borrower may choose to
select counsel to represent all indemnified Persons unless any
indemnified Person reasonably concludes that it would be legally
inappropriate for such joint counsel to continue to represent all
indemnified Persons. In such event, such indemnified Person may
retain additional and separate counsel at the Borrower's expense
to represent such indemnified Person. The agreements in this
subsection shall survive repayment of the Notes and all other
amounts payable hereunder.
9.6 Successors and Assigns; Participations and
Assignments. (a) This Agreement shall be binding upon and inure
to the benefit of the Borrower, the Lenders, the Administrative
Agent, the CAF Loan Agent, all future holders of the Notes and
their respective successors and permitted assigns, except that
the Borrower may not assign or transfer any of its rights or
obligations under this Agreement without the prior written
consent of each Lender.
(b) Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable
law, at any time sell to one or more banks or other entities
("Participants") participating interests in any Loan owing to
such Lender, any Note held by such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder and under
the other Loan Documents. In the event of any such sale by a
Lender of a participating interest to a Participant, such
Lender's obligations under this Agreement to the other parties to
this Agreement shall remain unchanged, such Lender shall remain
solely responsible for the performance thereof, such Lender shall
remain the holder of any such Note for all purposes under this
Agreement and the other Loan Documents, and the Borrower and the
Administrative Agent shall continue to deal solely and directly
with such Lender in connection with such Lender's rights and
obligations under this Agreement and the other Loan Documents;
provided, however, that no amendment, supplement, modification or
waiver of or to this Agreement or any Note shall (i) reduce the
amount or extend the final scheduled date of maturity of any
Note, or reduce the stated rate of interest or fee payable
hereunder or extend the scheduled date of any payment of interest
or fee or increase the aggregate amount or extend the expiration
date of any Lender's Commitments in which such Participant holds
an interest or (ii) permit the assignment or transfer by the
Borrower of any of its rights or obligations under this Agreement
without the consent of each Participant affected thereby. The
Borrower agrees that if amounts outstanding under this Agreement
and the Notes are due or unpaid, or shall have been declared or
shall have become due and payable upon the occurrence of an Event
of Default, each Participant shall, to the maximum extent
permitted by applicable law, be deemed to have the right of
setoff in respect of its participating interest in amounts owing
under this Agreement and any Note to the same extent as if the
amount of its participating interest were owing directly to it as
a Lender under this Agreement or any Note, provided that, (i) in
purchasing such participating interest, such Participant shall be
deemed to have agreed to share with the Lenders the proceeds
thereof as provided in subsection 9.7(a) as fully as if it were a
Lender hereunder, and (ii) such right of setoff shall not apply
to any fiduciary accounts, trust accounts, or any deposits for
statutory or regulatory purposes or otherwise required by any
Governmental Authority. The Borrower also agrees that each
Participant shall be entitled to the benefits of subsections
2.14, 2.15 and 2.16 with respect to its participation in the
Commitments and the Loans outstanding from time to time as if it
was a Lender; provided that, in the case of subsection 2.15, such
Participant shall have complied with the requirements of said
subsection and provided, further, that no Participant shall be
entitled to receive any greater amount pursuant to any such
subsection than the transferor Lender would have been entitled to
receive in respect of the amount of the participation transferred
by such transferor Lender to such Participant had no such
transfer occurred.
(c) Any Lender may, in the ordinary course of its
commercial banking business and in accordance with applicable
law, at any time and from time to time assign to any Lender or
any affiliate thereof or, with the consents of the Administrative
Agent and the Borrower (which consents shall not be unreasonably
withheld), to an additional bank or financial institution (an
"Assignee") all or any part of its rights and obligations under
this Agreement and the Notes pursuant to an Assignment and
Acceptance, substantially in the form of Exhibit H, executed by
such Assignee, such assigning Lender (and, in the case of an
Assignee that is not then a Lender or an affiliate thereof, by
the Administrative Agent and the Borrower) and delivered to the
Administrative Agent for its acceptance and recording in the
Register, provided that, (i) in the case of any such assignment
to an additional bank or financial institution, the aggregate
amount of the Exposure being assigned shall be not less than
$10,000,000 and, if such assignment is of less than all of the
rights and obligations of the assigning Lender, the aggregate
amount of the Exposure remaining with the assigning Lender shall
be not less than $10,000,000 and (ii) in the case of any such
assignment where such assignment is of less than all of the
rights and obligations of the assigning Lender, the ratio of (1)
the aggregate principal amount of Term Loans (and, if applicable,
the Term Loan Commitments) being assigned by such assigning
Lender to (2) the aggregate principal amount of Term Loans (and,
if applicable, the Term Loan Commitments) of such assigning
Lender prior to giving effect to such assignment shall equal the
ratio of (1) the aggregate principal amount of Revolving Credit
Loans (and, if applicable, the Revolving Credit Commitments)
being assigned by such assigning Lender to (2) the aggregate
principal amount of Revolving Credit Loans (and, if applicable,
the Revolving Credit Commitments) of such assigning Lender prior
to giving effect to such assignment. Upon such execution,
delivery, acceptance and recording, from and after the effective
date determined pursuant to such Assignment and Acceptance, (x)
the Assignee thereunder shall be a party hereto and, to the
extent provided in such Assignment and Acceptance, have the
rights and obligations of a Lender hereunder with Commitments as
set forth therein, and (y) the assigning Lender thereunder shall,
to the extent provided in such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the
case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations
under this Agreement, such assigning Lender shall cease to be a
party hereto). Notwithstanding any provision of this paragraph
(c) and paragraph (e) of this subsection, the consent of the
Borrower shall not be required, and, unless requested by the
Assignee and/or the assigning Lender, new Notes shall not be
required to be executed and delivered by the Borrower, for any
assignment which occurs at any time when any of the events
described in subsection 7(f) shall have occurred and be
continuing.
(d) The Administrative Agent shall maintain at its
address referred to in subsection 9.2 a copy of each Assignment
and Acceptance delivered to it and a register (the "Register")
for the recordation of the names and addresses of the Lenders and
the Commitments of, and principal amount of the Loans owing to,
each Lender from time to time. The entries in the Register shall
be conclusive, in the absence of manifest error, and the
Borrower, the Administrative Agent and the Lenders may treat each
Person whose name is recorded in the Register as the owner of the
Loans recorded therein for all purposes of this Agreement. The
Register shall be available for inspection by the Borrower or any
Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender and an Assignee (and, in the case
of an Assignee that is not then a Lender or an affiliate thereof,
by the Administrative Agent and the Borrower) together with
payment to the Administrative Agent of a registration and
processing fee of $2,500, the Administrative Agent shall (i)
promptly accept such Assignment and Acceptance and (ii) on the
effective date determined pursuant thereto record the information
contained therein in the Register and give notice of such
acceptance and recordation to the Lenders and the Borrower. On
or prior to such effective date, the Borrower, at its own
expense, shall, upon request therefor, execute and deliver to the
Administrative Agent (in exchange for the Revolving Credit Note,
CAF Loan Note and Term Note of the assigning Lender) a new
Revolving Credit Note, CAF Loan Note, and Term Note, as the case
may be, to the order of such Assignee in an amount equal to the
Revolving Credit Commitment and Term Loan Commitment or Term
Loan, assumed or acquired by it pursuant to such Assignment and
Acceptance and, if the assigning Lender has retained a Revolving
Credit Commitment and Term Loan hereunder, a new Revolving Credit
Note, CAF Loan Note and Term Note, to the order of the assigning
Lender in amounts equal to the Revolving Credit Commitment and
Term Loan Commitment or Term Loan, as the case may be, retained
by it hereunder. Such new Notes shall be dated the Closing Date
and shall otherwise be in the form of the Notes replaced thereby.
(f) The Borrower authorizes each Lender to disclose to
any Participant or Assignee (each, a "Transferee") and any
prospective Transferee any and all financial information in such
Lender's possession concerning the Borrower and its Affiliates
which has been delivered to such Lender by or on behalf of the
Borrower pursuant to this Agreement or which has been delivered
to such Lender by or on behalf of the Borrower in connection with
such Lender's credit evaluation of the Borrower and its
Affiliates prior to becoming a party to this Agreement; provided,
however, that prior to being furnished with any such information
which is confidential information obtained pursuant to the
requirements of this Agreement, the Transferee shall agree to
preserve the confidentiality of such information in accordance
with subsection 9.16.
(g) Nothing herein shall prohibit any Lender from
pledging or assigning any Note to any Federal Reserve Bank in
accordance with applicable law. No Lender shall, as between the
Borrower and such Lender, be relieved of any of its obligations
hereunder as a result of any such assignment and pledge.
9.7 Adjustments; Set-off. (a) If any Lender (a
"benefitted Lender") shall at any time receive any payment of all
or part of its Loans, or interest thereon, or receive any
collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of
the nature referred to in Section 7(f), or otherwise), in a
greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other
Lender's Loans, or interest thereon, such benefitted Lender shall
purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Loan, or shall
provide such other Lenders with the benefits of any such
collateral, or the proceeds thereof, as shall be necessary to
cause such benefitted Lender to share the excess payment or
benefits of such collateral or proceeds ratably with each of the
Lenders; provided, however, that if all or any portion of such
excess payment or benefits is thereafter recovered from such
benefitted Lender, such purchase shall be rescinded, and the
purchase price and benefits returned, to the extent of such
recovery, but without interest.
(b) In addition to any rights and remedies of the
Lenders provided by law, each Lender shall have the right,
without prior notice to the Borrower, any such notice being
expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the
Borrower hereunder or under the Notes (whether at the stated
maturity, by acceleration or otherwise) and upon the occurrence
and during the continuance of any Event of Default to set-off and
appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final, but
not including fiduciary accounts, trust accounts, or any deposits
for statutory or regulatory purposes or otherwise required by any
Governmental Authority), in any currency, and any other credits,
indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured,
at any time held or owing by such Lender or any branch, agency or
affiliate thereof to or for the credit or the account of the
Borrower. Each Lender agrees promptly to notify the Borrower and
the Administrative Agent after any such set-off and application
made by such Lender, provided that the failure to give such
notice shall not affect the validity of such set-off and
application.
9.8 Counterparts. This Agreement may be executed by
one or more of the parties to this Agreement on any number of
separate counterparts (including by telecopy), and all of said
counterparts taken together shall be deemed to constitute one and
the same instrument. A set of the copies of this Agreement
signed by all the parties shall be lodged with the Borrower and
the Administrative Agent.
9.9 Severability. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such
prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
9.10 Integration. This Agreement and the other Loan
Documents represent the agreement of the Borrower, the
Administrative Agent and the Lenders with respect to the subject
matter hereof, and there are no promises, undertakings,
representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth
or referred to herein or in the other Loan Documents.
9.11 GOVERNING LAW. THIS AGREEMENT AND THE NOTES AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT
AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
9.12 Submission To Jurisdiction; Waivers. The
Borrower hereby irrevocably and unconditionally:
(a) submits for itself and its property in any legal
action or proceeding relating to this Agreement and the
other Loan Documents to which it is a party, or for
recognition and enforcement of any judgement in respect
thereof, to the non-exclusive jurisdiction of the Courts of
the State of New York, the courts of the United States of
America for the Southern District of New York, and appellate
courts from any thereof;
(b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may
now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees
not to plead or claim the same;
(c) agrees that service of process in any such action
or proceeding may be effected by mailing a copy thereof by
registered or certified mail (or any substantially similar
form of mail), postage prepaid, to the Borrower at its
address set forth in subsection 9.2 or at such other address
of which the Administrative Agent shall have been notified
pursuant thereto; and
(d) agrees that nothing herein shall affect the right
to effect service of process in any other manner permitted
by law or shall limit the right to sue in any other
jurisdiction.
9.13 Acknowledgements. The Borrower hereby
acknowledges that:
(a) it has been advised by counsel in the negotiation,
execution and delivery of this Agreement and the Notes;
(b) neither the Administrative Agent, the CAF Loan
Agent nor any Lender has any fiduciary relationship with or
duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the
relationship between Administrative Agent, the CAF Loan
Agent and Lenders, on one hand, and the Borrower, on the
other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other
Loan Documents or otherwise exists by virtue of the
transactions contemplated hereby among the Lenders or among
the Borrower and the Lenders.
9.14 WAIVERS OF JURY TRIAL. THE BORROWER, THE
ADMINISTRATIVE AGENT, THE CAF LOAN AGENT AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR THE NOTES AND
FOR ANY COUNTERCLAIM THEREIN.
9.15 Schedules. (a) As provided in this Agreement,
the Revolving Credit Commitment and the Term Loan Commitment of
each Lender on the date of execution of this Agreement will be
such respective amounts set forth with such Lender's name on the
signature pages of this Agreement. During the period between the
date hereof and the Closing Date, additional banks and financial
institutions may, with the consent of the Borrower and the
Administrative Agent (which, in each case, shall not be
unreasonably withheld) become Lenders by executing a counterpart
of this Agreement, whereupon the Administrative Agent shall
reallocate the Commitments of all existing Lenders that consent
to such reallocation and allocate Commitments to such new Lender,
in such respective amounts as shall be approved by all such
Lenders. Prior to the Closing Date, the Administrative Agent
shall complete Schedule I and insert thereon for each Lender the
Revolving Credit Commitment and Term Loan Commitment as allocated
pursuant to the preceding sentence, the Revolving Credit
Commitment Percentage and Term Loan Commitment Percentage as
calculated by the Administrative Agent on the basis of such
Revolving Credit Commitments and Term Loan Commitments of the
Lenders and the address for notices and other administrative
information as advised to the Administrative Agent by such
Lender.
(b) On or prior to the Closing Date, the Borrower may
provide to the Administrative Agent revised Schedules II, III, IV
and V, and if such revised Schedules are reasonably acceptable to
the Administrative Agent and the Required Lenders, they shall be
attached to this Agreement in replacement for the corresponding
Schedules attached to this Agreement on the date hereof.
(c) A copy of the Schedules to this Agreement as
completed pursuant to paragraph (a) and (b) above shall be
included in the Conformed Copy of this Agreement to be
distributed by the Administrative Agent to each of the parties
hereto. The Administrative Agent is hereby authorized to amend
Schedule I from time to time to reflect assignments effected
pursuant to subsection 9.6.
9.16 Confidentiality. Each Lender agrees to keep
confidential any non-public information provided to it by or on
behalf of the Borrower or any of its Subsidiaries pursuant to or
in connection with this Agreement and which the Borrower or such
Subsidiary identifies as confidential; provided that nothing
herein shall prevent any Lender from disclosing any such
information (i) to the Administrative Agent or any other Lender,
(ii) to any Assignee or Participant which agrees to comply with
the provisions of this subsection, (iii) to such Lender's parent
holding company (but not to any entity engaged in securities
trading) and to the employees, directors, agents, attorneys,
accountants and other professional advisors of such Lender or
such parent holding company, (iv) upon the request or demand of
any Governmental Authority having jurisdiction over such Lender,
(v) in response to any order of any court (after notice by such
Lender to the Borrower, if such notice would not be prohibited in
connection with such court order) or other Governmental Authority
or as may otherwise be required pursuant to any Requirement of
Law, (vi) which has been publicly disclosed other than in breach
of this Agreement or (vii) in connection with the exercise of any
remedy hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and
duly authorized officers as of the day and year first above
written.
FHP INTERNATIONAL CORPORATION
By: /s/ Michael Montevideo
Title: Treasurer
CHEMICAL SECURITIES INC., as
Arranger
By: /s/ Robert Parker
Title: Vice President
Term Loan Commitment: CHEMICAL BANK,
as Administrative Agent, as
$21,428,571 CAF Loan Agent and
as a Lender
Revolving Credit Commitment:
$8,571,429 By: /s/ Peter Eckstein
Title: Vice President
Term Loan Commitment: FIRST INTERSTATE BANK OF
CALIFORNIA (FICAL), as a Lead
$17,857,143 Manager and a Lender
By: /s/ Barbara Vienneau
Title: Vice President
Revolving Credit Commitment:
$7,142,857
Term Loan Commitment: BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION, as a
$12,857,143 Lead Manager and a Lender
By: /s/ Matthew Koenig
Title: Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: THE BANK OF NEW YORK, as a
Lead Manager and a Lender
$12,857,143
By: /s/ Lisa Y. Brown
Title: Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: CITICORP USA, INC., as a
Lead Manager and a Lender
$12,857,143
By: /s/ Barbara Cohen
Title: Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: FIRST UNION NATIONAL BANK OF NORTH
CAROLINA, as a Lead Manager
$12,857,143 and a Lender
By: /s/ Thomas Shinkle
Title: Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: NATIONAL WESTMINSTER PLC - NEW YORK
BRANCH, as a Lead Manager
$12,857,143 and a Lender
By: /s/ Gary Miller
Title: Senior Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: PNC BANK, NATIONAL ASSOCIATION, as
a Lead Manager and a Lender
$12,857,143
By: /s/ Anthony Trunzo
Title: Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: THE LONG-TERM CREDIT BANK OF JAPAN,
LTD., as a Lead Manager and a
$12,857,143 Lender
By: /s/ Y. Kamisawa
Title: Deputy General Manager
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: THE SUMITOMO TRUST & BANKING CO.,
LTD., NEW YORK BRANCH, as a Lead
$12,857,143 Manager and a Lender
By: /s/ Suraj P. Bhatia
Title: Senior Vice President
Revolving Credit Commitment:
$5,142,857
Term Loan Commitment: BANKERS TRUST COMPANY, as a Lead
Manager and a Lender
$10,714,286
By: /s/ Mary Jo Jolly
Title: Assistant Vice President
Revolving Credit Commitment:
$4,285,714
Term Loan Commitment: NATIONSBANK OF TEXAS, N.A., as a
Lead Manager and a Lender
$10,714,286
By: /s/ Pamela F. Randell
Title: Vice President
Revolving Credit Commitment:
$4,285,714
Term Loan Commitment: TORONTO DOMINION (TEXAS) INC., as a
Lead Manager and a Lender
$10,714,286
By: /s/ C.S. Clause
Title: Vice President
Revolving Credit Commitment:
$4,285,714
Term Loan Commitment: WELLS FARGO BANK, N.A., as a Lead
Manager and a Lender
$10,714,286
By: /s/ David Neumann
Title: Vice President
Revolving Credit Commitment:
$4,285,714
Term Loan Commitment: BANK OF HAWAII
$9,285,714
By: /s/ Cynthia L. Davis
Title: Vice President
Revolving Credit Commitment:
$3,714,286
Term Loan Commitment: KREDIETBANK N.V.
$9,285,714
By: /s/ Diane Grimmig
Title: Vice President
Revolving Credit Commitment:
By: /s/ Robert Snauffer
$3,714,286 Title: Vice President
Term Loan Commitment: THE DAI-ICHI KANGYO BANK, LTD. -
LOS ANGELES AGENCY
$9,285,714
By: /s/ Teruhisa Yamaguchi
Title: Senior Vice President and
Revolving Credit Commitment: Joint General Manager
$3,714,286
Term Loan Commitment: THE INDUSTRIAL BANK OF JAPAN,
LIMITED, LOS ANGELES AGENCY
$9,285,714
By: /s/ Toshinari Iyoda
Title: Senior Vice President
Revolving Credit Commitment:
$3,714,286
Term Loan Commitment: THE SANWA BANK LIMITED, ACTING
THROUGH THE LOS ANGELES BRANCH
$9,285,714
By: /s/ Mike Abdelaaty
Title: Vice President and Manager
Revolving Credit Commitment:
$3,714,286
Term Loan Commitment: THE SUMITOMO BANK, LIMITED, LOS
ANGELES BRANCH
$9,285,714
By: /s/ Hiroshi Amano
Title: General Manager
Revolving Credit Commitment:
$3,714,286
Term Loan Commitment: THE TOKAI BANK, LTD., LOS ANGELES
AGENCY
$9,285,714
By: /s/ Hitoshi Ozawa
Title: Assistant General
Revolving Credit Commitment:
$3,714,286
<PAGE>
SCHEDULE I
Names and Commitments of Lenders
[To be Completed by the Administrative Agent
as provided in Subsection 9.15]
<PAGE>
EXHIBIT A
FORM OF REVOLVING CREDIT NOTE
$_____________ New York, New York
_______ __, 1994
FOR VALUE RECEIVED, the undersigned, FHP INTERNATIONAL
CORPORATION, a Delaware corporation (the "Borrower"), hereby
unconditionally promises to pay to the order of
_______________________________ (the "Lender") at the office of
Chemical Bank, located at 270 Park Avenue, New York, New York
10017, in lawful money of the United States of America and in
immediately available funds, the principal amount of (a)
_______________ DOLLARS ($__________), or, if less, (b) the
aggregate unpaid principal amount of all Revolving Credit Loans
made by the Lender to the Borrower pursuant to subsection 2.1 of
the Credit Agreement hereinafter referred to (the "Credit
Agreement"). The principal amount of each Revolving Credit Loan
evidenced hereby shall be payable on the Revolving Credit
Termination Date. The Borrower further agrees to pay interest in
like money at such office on the unpaid principal amount hereof
from time to time outstanding at the applicable interest rate per
annum determined as provided in, and payable as specified in,
subsection 2.9 of the Credit Agreement.
The holder of this Note is authorized to record the
date, Type and amount of each Revolving Credit Loan made by the
Lender pursuant to subsection 2.1 of the Credit Agreement, the
date and amount of each repayment of principal hereof, the date
of each interest rate conversion pursuant to subsection 2.7 of
the Credit Agreement and the principal amount subject thereto,
and in the case of Eurodollar Loans, the Interest Periods with
respect thereto, on the schedules annexed hereto and made a part
hereof or on any other record customarily maintained by such
Lender with respect to this Note and any such recordation shall
constitute prima facie evidence of the accuracy of the
information so recorded; provided, however, that the failure to
make any such recordation shall not affect the obligations of the
Borrower in respect of such Revolving Credit Loan.
This Note is one of the Revolving Credit Notes referred
to in the Credit Agreement dated as of March 24, 1994, among the
Borrower, the Lender, the other banks and financial institutions
from time to time parties thereto, Chemical Bank, as
Administrative Agent and CAF Loan Agent and Chemical Securities
Inc., as Arranger, and is entitled to the benefits thereof.
Upon the occurrence of any one or more of the Events of
Default specified in the Credit Agreement, all amounts then
remaining unpaid on this Note shall become, or may be declared to
be, immediately due and payable, all as provided therein.
All parties now and hereafter liable with respect to
this Note, whether maker, principal, surety, guarantor, endorser
or otherwise, hereby waive presentment, demand, protest and all
other notices of any kind to the full extent permitted by law.
Terms defined in the Credit Agreement are used herein
with their defined meanings unless otherwise defined herein.
This Note shall be governed by, and construed and interpreted in
accordance with, the law of the State of New York.
FHP INTERNATIONAL CORPORATION
By______________________
Title:
<PAGE>
Schedule 1 to
Note
ALTERNATE BASE RATE LOANS
LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount
Converted Amount Converted
Amount to Alter- of to Euro- Unpaid
of nate Base Principal dollar Principal
Notation
Date Loans Rate Loans Repaid Loans Balance
Made By
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________
____ ______ __________ _________ _________ _________
_________<PAGE>
Schedule 2 to
Note
EURODOLLAR LOANS
LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount
Converted Amount Converted
Amount to Euro- of to Alter- Unpaid
of dollar Principal nate Base Principal
Notation
Date Loans Loans Repaid Rate Loans Balance
Made By
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________<PAGE>
EXHIBIT B
FORM OF TERM NOTE
$_____________ New York, New York
_______ __, 1994
FOR VALUE RECEIVED, the undersigned, FHP
INTERNATIONAL CORPORATION, a Delaware corporation (the
"Borrower"), hereby unconditionally promises to pay to the order
of _______________________________ (the "Lender") at the office
of Chemical Bank, located at 270 Park Avenue, New York, New York
10017, in lawful money of the United States of America and in
immediately available funds, the principal amount of (a)
_______________ DOLLARS ($__________), or, if less, (b) the
aggregate unpaid principal amount of all Term Loans made by the
Lender to the Borrower pursuant to subsection 2.2 of the Credit
Agreement hereinafter referred to (the "Credit Agreement"), in
installments in the amounts and on the dates determined as
provided in the Credit Agreement. The Borrower further agrees to
pay interest in like money at such office on the unpaid principal
amount hereof from time to time outstanding at the applicable
interest rate per annum determined as provided in, and payable as
specified in, subsection 2.9 of the Credit Agreement.
The holder of this Note is authorized to record
the date, Type and amount of each Term Loan made by the Lender
pursuant to subsection 2.2 of the Credit Agreement, the date and
amount of each repayment of principal hereof, the date of each
interest rate conversion pursuant to subsection 2.7 of the Credit
Agreement and the principal amount subject thereto, and in the
case of Eurodollar Loans, the Interest Periods with respect
thereto on the schedules annexed hereto and made a part hereof or
on any other record customarily maintained by such Lender with
respect to this Note and any such recordation shall constitute
prima facie evidence of the accuracy of the information so
recorded; provided, however, that the failure to make any such
recordation shall not affect the obligations of the Borrower in
respect of such Term Loan.
This Note is one of the Term Notes referred to in
the Credit Agreement dated as of March 24, 1994, among the
Borrower, the Lender, the other banks and financial institutions
from time to time parties thereto, Chemical Bank, as
Administrative Agent and CAF Loan Agent and Chemical Securities
Inc., as Arranger, and is entitled to the benefits thereof.
Upon the occurrence of any one or more of the
Events of Default specified in the Credit Agreement, all amounts
then remaining unpaid on this Note shall become, or may be
declared to be, immediately due and payable, all as provided
therein.
All parties now and hereafter liable with respect
to this Note, whether maker, principal, surety, guarantor,
endorser or otherwise, hereby waive presentment, demand, protest
and all other notices of any kind to the full extent permitted by
law.
Terms defined in the Credit Agreement are used
herein with their defined meanings unless otherwise defined
herein. This Note shall be governed by, and construed and
interpreted in accordance with, the law of the State of New York.
FHP INTERNATIONAL CORPORATION
By______________________
Title:
<PAGE>
Schedule 1 to
Note
ALTERNATE BASE RATE LOANS
LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount
Converted Amount Converted
Amount to Alter- of to Euro- Unpaid
of nate Base Principal dollar Principal
Notation
Date Loan Rate Loans Repaid Loans Balance
Made By
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________<PAGE>
Schedule 2 to
Note
EURODOLLAR LOANS
LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount
Converted Amount Converted
Amount to Euro- of to Alter- Unpaid
of dollar Principal nate Base Principal
Notation
Date Loan Loans Repaid Rate Loans Balance
Made By
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________
____ ______ _________ _________ _________ _________
_________<PAGE>
EXHIBIT C
FORM OF CAF LOAN NOTE
$100,000,000 New York, New York
, 1994
FOR VALUE RECEIVED, the undersigned, FHP
International Corporation, a Delaware corporation (the
"Borrower") hereby unconditionally promises to pay to the order
of ______________________________ (the "Lender") at the office of
Chemical Bank, located at 270 Park Avenue, New York, New York
10017, in lawful money of the United States of America and in
immediately available funds, the principal amount of (a) ONE
HUNDRED MILLION AND 00/100 DOLLARS ($100,000,000), or, if less,
(b) the aggregate unpaid principal amount of all CAF Loans that
are made by the Lender to the Borrower pursuant to subsection 2.3
of the Credit Agreement hereinafter referred to (the "Credit
Agreement"). The principal amount of each CAF Loan evidenced
hereby shall be payable on the maturity date therefor determined
in accordance with subsection 2.3(d) and set forth on the
schedule annexed hereto and made a part hereof or on a
continuation thereof which shall be attached hereto and made a
part hereof or on any other record customarily maintained by such
Lender with respect to this Note (the "Grid") (such maturity date
being that specified by the Borrower for repayment of such CAF
Loan in the related CAF Loan Request). The Borrower further
agrees to pay interest in like money at such office on the unpaid
principal amount of each CAF Loan evidenced hereby, at the rate
per annum set forth in respect of such CAF Loan on the Grid and
determined in accordance with subsection 2.3(b) of the Credit
Agreement, calculated on the basis of a year of 360 days and
actual days elapsed from the date of such CAF Loan until the due
date thereof (whether at the stated maturity, by acceleration or
otherwise) and thereafter at the rates determined in accordance
with subsection 2.3(e) of the Credit Agreement. Interest on each
CAF Loan evidenced hereby shall be payable on the date or dates
set forth in respect of such CAF Loan on the Grid and determined
in accordance with subsection 2.3(e) of the Credit Agreement.
CAF Loans evidenced by this Note may not be prepaid except as
provided in the Credit Agreement.
The holder of this Note is authorized to record
on the Grid the date, amount, interest rate, interest payment
dates and maturity date in respect of each CAF Loan made pursuant
to subsection 2.3 of the Credit Agreement and each payment of
principal with respect thereto, which recordation shall
constitute prima facie evidence of the accuracy of the
information so recorded; provided, however, that the failure to
make any such recordation shall not affect the obligations of the
Borrower in respect of such CAF Loan.
This Note is one of the CAF Loan Notes referred
to in the Credit Agreement dated as of March 24, 1994, among the
Borrower, the Lender, the other banks and financial institutions
from time to time parties thereto, Chemical Bank, as
Administrative Agent and CAF Loan Agent and Chemical Securities
Inc., as Arranger, and is entitled to the benefits thereof.
Upon the occurrence of any one or more of the
Events of Default specified in the Credit Agreement, all amounts
then remaining unpaid on this Note shall become, or may be
declared to be, immediately due and payable, all as provided
therein.
All parties now and hereafter liable with respect
to this Note, whether maker, principal, surety, guarantor,
endorser or otherwise, hereby waive presentment, demand, protest
and all other notices of any kind to the full extent permitted by
law.
Terms defined in the Credit Agreement are used
herein with their defined meanings unless otherwise defined
herein. This Note shall be governed by, and construed and
interpreted in accordance with, the law of the State of New York.
FHP INTERNATIONAL CORPORATION
By:__________________________
Title:
<PAGE>
SCHEDULE OF CAF LOANS
Date Amount Interest
of of Interest Maturity Payment Author-
Loan Loan Rate Date Date ization
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
____ ______ ________ ________ ________ _______
<PAGE>
EXHIBIT D
FORM OF CAF LOAN REQUEST
________________, 19__
Chemical Bank, as CAF Loan Agent
270 Park Avenue
New York, New York 10017
Dear Sirs:
Reference is made to the Credit Agreement, dated
as of March 24, 1994, among the undersigned, the Lenders named
therein, Chemical Bank, as Agent and CAF Loan Agent and Chemical
Securities Inc., as Arranger (as the same may be amended,
supplemented or otherwise modified from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used
herein as therein defined.
This is a [LIBOR Auction Advance] [Fixed Rate
Auction Advance] Request pursuant to subsection 2.3 of the Credit
Agreement requesting quotes for the following CAF Loans:
Aggregate principal amount $_______ $_______
$_______
CAF Loan Date _______
_______ _______
[Interest period] _______
_______ _______
Maturity date _______
_______ _______
Interest payment dates _______ _______
_______
Very truly yours,
FHP INTERNATIONAL CORPORATION
By:_______________________
Title:
[Note: Pursuant to the Credit Agreement, a CAF Loan
Request may be transmitted in writing, or by
facsimile transmission, or by telephone
(confirmed promptly on the same day in writing).
In any case, a CAF Loan Request shall contain the
information specified in the second paragraph of
this form.]
EXHIBIT E
FORM OF CAF LOAN OFFER
________________, 19__
Chemical Bank, as CAF Loan Agent
270 Park Avenue
New York, New York 10017
Dear Sirs:
Reference is made to the Credit Agreement, dated
as of March 24, 1994, among FHP International Corporation, the
Lenders named therein, Chemical Bank, as Agent and CAF Loan Agent
and Chemical Securities Inc., as Arranger (as the same may be
amended, supplemented or otherwise modified from time to time,
the "Credit Agreement"). Terms defined in the Credit Agreement
are used herein as therein defined.
In accordance with subsection 2.3 of the Credit
Agreement, the undersigned Lender irrevocably offers to make CAF
Loans thereunder in the following amounts with the following
maturity dates:
CAF Loan Date: _____________, 19__
Aggregate Maximum Amount: $_____________
Maturity Date 1 ___: Maturity Date 2 ___: Maturity Date 3 ___:
Maximum Amount $___ Maximum Amount $___ Maximum Amount $___
Rate Amount $___ Rate * Amount $___ Rate * Amount $___
Rate * Amount $___ Rate * Amount $___ Rate * Amount $___
Very truly yours,
By: _________________________
Name:
Title:
Telephone No.:
Fax No.:<PAGE>
EXHIBIT F
FORM OF CAF LOAN CONFIRMATION
_________________, 19__
Chemical Bank, as CAF Loan Agent
270 Park Avenue
New York, New York 10017
Dear Sirs:
Reference is made to the Credit Agreement, dated as of
March 24, 1994, among the undersigned, the Lenders named therein,
Chemical Bank, as Agent and CAF Loan Agent and Chemical
Securities Inc., as Arranger (as the same may be amended,
supplemented or otherwise modified from time to time, the "Credit
Agreement"). Terms defined in the Credit Agreement are used
herein as therein defined.
In accordance with subsection 2.3 of the Credit
Agreement, the undersigned accepts and confirms the offer(s) by
the CAF Loan Lender(s) to make CAF Loans to the undersigned on
____________, 19__ [CAF Loan Date] under said subsection 2.3 in
the (respective) amount(s) set forth on the attached list of CAF
Loans offered.
Very truly yours,
FHP INTERNATIONAL CORPORATION
By____________________________
Title:
[Borrower to attach CAF Loan offer list prepared by CAF
Loan Agent with accepted amount entered by the Borrower to right
of each CAF Loan offer described on such offer list].
EXHIBIT G
FORM OF CLOSING CERTIFICATE
Pursuant to subsection 4.1( ) of the Credit Agreement
dated as of March 24, 1993 (as the same may be amended,
supplemented or otherwise modified from time to time, the
"Agreement") among FHP International Corporation, a Delaware
corporation (the "Borrower"), the banks and other financial
institutions parties thereto, Chemical Bank, as Agent and CAF
Loan Agent and Chemical Securities Inc., as Arranger, the
undersigned [Vice President] and [Assistant] Secretary of the
Borrower hereby certifies on behalf of the Borrower as follows
(terms defined in the Agreement being used herein with the
defined meanings assigned to such terms in the Agreement):
1. The representations and warranties made by the
Borrower in each of the Loan Documents or which are
contained in any certificate, document or other written
materials furnished pursuant to or in connection
therewith are true and correct in all material respects
on and as of the date hereof as if made on and as of
the date hereof and after giving effect to the Loans
requested to be made pursuant to the Agreement on the
date hereof, except to the extent such representations
and warranties specifically relate to an earlier date,
in which case such representations and warranties shall
have been true and correct in all material respects on
and as of such earlier date;
2. Immediately prior to and immediately after the
making of the Loans requested to be made pursuant to
the Agreement on the date hereof, no Default or Event
of Default will have occurred and will be continuing
under the Agreement;
3. Attached hereto as Exhibit A is a true and complete
copy of the resolutions duly adopted by the Board of
Directors of the Borrower; such resolutions have not in any
way been amended, modified, revoked or rescinded and have
been in full force and effect since their adoption to and
including the date hereof and are now in full force and
effect; such resolutions are the only proceedings of the
Borrower now in force relating to or affecting the Loan
Documents and the Merger Documents to which the Borrower is
a party; attached hereto as Exhibit B is a true and complete
copy of the By-laws of the Borrower as in effect on the date
hereof; and attached hereto as Exhibit C is a true and
complete copy of the Certificate of Incorporation of the
Borrower as in effect on the date hereof;
4. _______________ is the duly elected and qualified
[Assistant] Secretary of the Borrower and the signature set
forth on the signature line for such officer is such
officer's true and genuine signature;
and the undersigned [Assistant] Secretary of the
Borrower hereby certifies on behalf of the Borrower as
follows:
5. The following persons are now duly elected and
qualified officers of the Borrower holding the offices
indicated next to their respective names below, and the
signatures appearing opposite their respective names
below are the true and genuine signatures of such
officers, and each of such officers is duly authorized
to execute and deliver on behalf of the Borrower Merger
Documents, the Loan Documents and any certificate,
document or other material to be delivered by the
Borrower pursuant to the Loan Documents or the Merger
Documents:
Name<PAGE>
Office<PAGE>
Signature Westcott W. Price III President and CEO, Office
of the Chief Executive<PAGE>
<PAGE>
Mark B. Hacken<PAGE>
President and CEO, Office
of the Chief Executive<PAGE>
<PAGE>
Jack D. Massimino<PAGE>
Executive Vice President
<PAGE>
Burke F. Gumbiner<PAGE>
Senior Vice President
<PAGE>
Bruce G. Bodaken<PAGE>
Senior Vice President
<PAGE>
Ryan M. Trimble<PAGE>
Senior Vice President
<PAGE>
Michael J. Weinstock<PAGE>
Senior Vice President,
General Counsel & Secretary<PAGE>
<PAGE>
Kenneth S. Ord<PAGE>
Senior Vice President & CFO
<PAGE>
Valerie A. Fletcher<PAGE>
Controller
<PAGE>
Michael A. Montevideo<PAGE>
Treasurer
<PAGE>
Robert F. Murphy<PAGE>
Assistant Secretary
<PAGE>
Lynn E. Iba<PAGE>
Assistant Secretary
<PAGE>
Charles H. Eldredge<PAGE>
Assistant Treasurer
IN WITNESS WHEREOF, the undersigned have caused this
Certificate to be executed by its duly authorized officer on
________ __, 1994.
_________________________ _________________________
Name: Name:
Title: Title:
Exhibit A
to the
Closing Certificate
Board of Directors Resolutions
Exhibit B
to the
Closing Certificate
By-Laws
<PAGE>
Exhibit C
to the
Closing Certificate
Certificate of Incorporation<PAGE>
EXHIBIT H
[FORM OF ASSIGNMENT AND ACCEPTANCE]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement, dated as of
March 24, 1994, (as amended, supplemented, waived or otherwise
modified from time to time, the "Credit Agreement"), among FHP
International Corporation, a Delaware corporation (the
"Borrower"), the several banks and other financial institutions
from time to time parties thereto (the "Lenders"), Chemical Bank,
as agent for the Lenders (in such capacity, the "Administrative
Agent") and as CAF Loan Agent, and Chemical Securities Inc., as
Arranger. Unless otherwise defined herein, capitalized terms
defined in the Credit Agreement are used herein as defined
therein.
(the "Assignor") and
(the "Assignee") agree as follows:
1. The Assignor hereby irrevocably sells and assigns
to the Assignee without recourse to the Assignor, and the
Assignee hereby irrevocably purchases and assumes from the
Assignor without recourse to the Assignor, as of the
Transfer Effective Date (as defined below), a ___% interest
(the "Assigned Interest") in and to the Assignor's rights
and obligations under the Credit Agreement with respect to
those credit facilities provided for in the Credit Agreement
as are set forth on Schedule 1 (individually, an "Assigned
Facility"; collectively, the "Assigned Facilities"), in a
principal amount for each Assigned Facility as set forth on
Schedule 1.
2. The Assignor (a) makes no representation or
warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in
connection with the Credit Agreement or the execution,
legality, validity, enforceability, genuineness, sufficiency
or value of the Credit Agreement, any other Loan Document or
any other instrument or document furnished pursuant thereto,
other than that it has not created any adverse claim upon
the interest being assigned by it hereunder and that such
interest is free and clear of any such adverse claim; (b)
makes no representation or warranty and assumes no
responsibility with respect to the financial condition of
the Borrower, any of its Subsidiaries or any other obligor
or the performance or observance by the Borrower, any of its
Subsidiaries or any other obligor of any of their respective
obligations under the Credit Agreement or any other Loan
Document or any other instrument or document furnished
pursuant hereto or thereto; and (c) attaches the Note(s)
held by it evidencing the Assigned Facilities and requests
that the Administrative Agent exchange such Note(s) for a
new Note or Notes payable to the Assignee and (if the
Assignor has retained any interest in the Assigned Facility)
a new Note or Notes payable to the Assignor in the
respective amounts which reflect the assignment being made
hereby (and after giving effect to any other assignments
which have become effective on the Transfer Effective Date).
3. The Assignee (a) represents and warrants that it
is legally authorized to enter into this Assignment and
Acceptance; (b) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial
statements delivered pursuant to subsection 5.1 thereof and
such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to
enter into this Assignment and Acceptance; (c) agrees that
it will, independently and without reliance upon the
Assignor, the Administrative Agent or any other Lender and
based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit
decisions in taking or not taking action under the Credit
Agreement, the other Loan Documents or any other instrument
or document furnished pursuant hereto or thereto; (d)
appoints and authorizes the Administrative Agent to take
such action as agent on its behalf and to exercise such
powers and discretion under the Credit Agreement, the other
Loan Documents or any other instrument or document furnished
pursuant hereto or thereto as are delegated to the
Administrative Agent by the terms thereof, together with
such powers as are incidental thereto; and (e) agrees that
it will be bound by the provisions of the Credit Agreement
and will perform in accordance with its terms all the
obligations which by the terms of the Credit Agreement are
required to be performed by it as a Lender, including its
obligations pursuant to subsection 9.7 of the Credit
Agreement, and, if it is organized under the laws of a
jurisdiction outside the United States, its obligations
pursuant to subsection 2.15(b) of the Credit Agreement.
4. The effective date of this Assignment and
Acceptance shall be , 19 (the "Transfer
Effective Date"). Following the execution of this
Assignment and Acceptance, it will be delivered to the
Administrative Agent for acceptance by it and recording by
the Administrative Agent pursuant to subsection 9.6 of the
Credit Agreement, effective as of the Transfer Effective
Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days
after the date of such acceptance and recording by the
Administrative Agent).
5. Upon such acceptance and recording, from and after
the Transfer Effective Date, the Administrative Agent shall
make all payments in respect of the Assigned Interest
(including payments of principal, interest, fees and other
amounts) to the Assignee whether such amounts have accrued
prior to the Transfer Effective Date or accrued subsequent
to the Transfer Effective Date. The Assignor and the
Assignee shall make all appropriate adjustments in payments
by the Administrative Agent for periods prior to the
Transfer Effective Date or with respect to the making of
this assignment directly between themselves.
6. From and after the Transfer Effective Date, (a)
the Assignee shall be a party to the Credit Agreement and,
to the extent provided in this Assignment and Acceptance,
have the rights and obligations of a Lender thereunder and
under the other Loan Documents and shall be bound by the
provisions thereof and (b) the Assignor shall, to the extent
provided in this Assignment and Acceptance, relinquish its
rights and be released from its obligations under the Credit
Agreement.
7. Notwithstanding any other provision hereof, if the
consent of the Borrower hereto is required under subsection
9.6 of the Credit Agreement, this Assignment and Acceptance
shall not be effective unless such consent shall have been
obtained.
8. THIS ASSIGNMENT AND ACCEPTANCE SHALL BE GOVERNED
BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
PRINCIPLES OF CONFLICT OF LAWS THEREOF.
IN WITNESS WHEREOF, the parties hereto have caused this
Assignment and Acceptance to be executed as of the date first
above written by their respective duly authorized officers on
Schedule 1 hereto.<PAGE>
SCHEDULE 1 to the
Assignment and Acceptance
Re: Credit Agreement, dated as of
March 24, 1994, among FHP International Corporation,
the Lenders from time to time parties thereto,
Chemical Bank, as Administrative Agent and CAF
Loan Agent and Chemical Securities Inc., as Arranger
Name of Assignor:
Name of Assignee:
Transfer Effective Date of Assignment:
Credit
Facility Assigned<PAGE>
Principal
Amount Assigned<PAGE>
Commitment Percentage
Assigned<PAGE>
<PAGE>
$
<PAGE>
. %
[NAME OF ASSIGNEE] [NAME OF ASSIGNOR]
By: ______________________ By:______________________
Title: Title:
[Consents required only to the Consented To:
the extent provided in subsection
9.6 of the Credit Agreement] FHP INTERNATIONAL
CORPORATION
By:______________________
Title:
CHEMICAL BANK, as
Administrative Agent
By:______________________
Title:
Accepted for Recordation in
the Register
CHEMICAL BANK, as Administrative Agent
By:________________________
Title:<PAGE>
EXHIBIT I
[Matters to be Covered by Opinion of O'Melveny & Myers
and Opinion of the Borrower's Delaware Counsel]
1. No consent or authorization of, filing with, notice
to or other act by any United States Federal, New York or
California Governmental Authority, or any Delaware Governmental
Authority in respect of the Delaware General Corporation Law, is
required to borrow under the Credit Agreement, or for the
execution, delivery or performance of any of the Loan Documents.
2. Each of the Credit Agreement and the Notes
constitutes a legally valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its
terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws relating
to or limiting creditors' rights generally or by general
principles of equity including without limitation, concepts of
materiality, reasonableness, good faith and fair dealing and the
possible unavailability of specific performance or injunctive
relief (whether considered in proceedings in equity or at law).
3. The execution, delivery and performance by the
Borrower of the Credit Agreement and the Notes and the borrowings
under the Credit Agreement will not violate any United States
Federal, New York or California Requirement of Law or the
Delaware General Corporation Law.
4. No consent or authorization of, filing with, notice
to or other act by any United States Federal, New York or
California Governmental Authority, or any Delaware Governmental
Authority in respect of the Delaware General Corporation Law, is
required in connection with the execution, delivery or
performance of the Merger Agreement or the consummation of the
Merger except those (i) that have been made or obtained and are
in full force and effect or (ii) the absence of which would not
have a Material Adverse Effect.
5. The Merger Agreement constitutes a legally valid
and binding obligation of Merger Sub enforceable against Merger
Sub in accordance with its terms, except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or limiting creditors' rights generally
or by general principles of equity, including without limitation,
concepts of materiality, reasonableness, good faith and fair
dealing and the possible unavailability of specific performance
or injunctive relief (whether considered in proceedings in equity
or at law).
6. The execution, delivery and performance by Merger
Sub of the Merger Agreement, and the consummation of the Merger
contemplated thereby will not violate any United States Federal,
New York or California Requirement of law or the Delaware General
Corporation Law other than any such violation arising out of the
failure to obtain a consent of a Governmental Authority, the
failure to obtain which would not have a Material Adverse Effect.
7. The Certificate of Merger has been filed with the
Secretary of State of Delaware, and the Merger has become
effective under the Delaware General Corporation Law.
8. The use of proceeds of the borrowings under the
Credit Agreement to purchase TakeCare stock will not violate
Regulations G, T, U or X of the Federal Reserve Board.
<PAGE>
EXHIBIT J
[Matters to be Covered by Opinion of General Counsel]
1. The Borrower and each of its Subsidiaries has been
duly incorporated and is validly existing and in good standing
under the laws of its jurisdiction of incorporation, is duly
qualified to do business and in good standing as a foreign
corporation in all jurisdictions in which its ownership of
properties or the conduct of its businesses requires such
qualification (except where the failure to so qualify or be in
good standing would not have a Material Adverse Effect), and has
all corporate power and authority, the legal right and all
governmental franchises, licenses and permits, necessary to own
and lease its properties and conduct the businesses in which it
is engaged, except for franchises, licenses or permits the
failure to obtain which would not, in the aggregate, reasonably
be expected to have a Material Adverse Effect.
2. The Borrower has the corporate power and authority,
and the legal right, to execute, deliver and perform each of the
Credit Agreement and the Notes and to borrow under the Credit
Agreement. The Borrower has taken all necessary corporate action
to authorize the borrowings on the terms and conditions of the
Credit Agreement and the Notes and to authorize the execution,
delivery and performance of the Credit Agreement and the Notes.
3. No consent or authorization of, filing with, notice
to or other act by or in respect of any United States Federal, or
California Governmental Authority or, to the best of my
knowledge, any other Person is required in connection with the
borrowings under the Credit Agreement, or the execution, delivery
or performance of any of the Loan Documents; provided that I am
expressing no opinion herein with respect to Regulations G, T, U
or X of the Federal Reserve Board, as to which I understand you
have been advised by O'Melveny & Myers.
4. Each of the Credit Agreement and the Notes has been
duly executed and delivered by the Borrower.
5. The execution, delivery and performance by the
Borrower of the Credit Agreement and the Notes, the borrowings
under the Credit Agreement and the use of the proceeds thereof
for the purposes described in the Credit Agreement will not
violate any United States Federal or California Requirement of
Law or any material agreement, indenture or instrument applicable
to or binding upon the Borrower and its Subsidiaries and will not
result in, or require, the creation or imposition of any Lien on
any of its properties or revenues pursuant to any such
Requirement of Law or agreement, indenture or instrument;
provided that I am expressing no opinion herein with respect to
Regulations G, T, U or X of the Federal Reserve Board, as to
which I understand you have been advised by O'Melveny & Myers.
6. Except as described in , no
litigation, investigation or proceeding of or before any
arbitrator or Governmental Authority is pending or, to the best
of my knowledge, threatened by or against the Borrower or any of
its Subsidiaries or against any of their respective properties or
revenues (a) with respect to any of the Loan Documents or any of
the transactions contemplated thereby, including the Merger,
which could reasonably be expected to have a Material Adverse
Effect or (b) which could reasonably be expected to have a
Material Adverse Effect.
7. Merger Sub has the corporate power and authority,
and the legal right, to execute, deliver and perform the Merger
Agreement. Merger Sub has taken all necessary corporate action
to authorize the execution, delivery and performance of the
Merger Agreement.
8. No consent or authorization of, filing with, notice
to or other act by or in respect of any Governmental Authority
or, to the best of our knowledge, any other Person is required in
connection with the execution, delivery or performance of the
Merger Agreement or the consummation of the Merger, other than
those obtained or those the absence of which could not reasonably
be expected to have a Material Adverse Effect.
9. The Merger Agreement has been duly executed and
delivered by the Merger Sub.
10. The execution, delivery and performance by Merger
Sub of the Merger Agreement and the consummation of the Merger
contemplated thereby will not violate any United States or
California Requirement of Law, other than any such violation
arising out of the failure to obtain a consent of a Governmental
Authority, the failure to obtain which would not have a Material
Adverse Effect, or any material agreement, indenture or
instrument applicable to or binding upon the Borrower and its
Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of its properties or revenues
pursuant to any such Requirement of Law or agreement, indenture
or instrument.
<PAGE>
EXECUTION COPY
CREDIT AGREEMENT
among
FHP INTERNATIONAL CORPORATION,
The Several Lenders
from Time to Time Parties Hereto
CHEMICAL BANK,
as Administrative Agent and as CAF Loan Agent,
and
CHEMICAL SECURITIES INC.,
as Arranger
Dated as of March 24, 1994
TABLE OF CONTENTS
Page
SECTION 1. DEFINITIONS. . . . . . . . . . . . . . . . . . . . 1
1.1 Defined Terms. . . . . . . . . . . . . . . . . . . 1
1.2 Other Definitional Provisions. . . . . . . . . . . 18
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS. . . . . . . . . . 19
2.1 Revolving Credit Commitments and Revolving\
Credit Notes . . . . . . . . . . . . . . . . . . 19
2.2 Term Loans and Term Notes. . . . . . . . . . . . . 21
2.3 CAF Loans and CAF Loan Notes . . . . . . . . . . . 22
2.4 Fees . . . . . . . . . . . . . . . . . . . . . . . 26
2.5 Termination or Reduction of Commitments. . . . . . 28
2.6 Optional and Mandatory Prepayments . . . . . . . . 28
2.7 Conversion and Continuation Options. . . . . . . . 29
2.8 Minimum Amounts of Tranches. . . . . . . . . . . . 30
2.9 Interest Rates and Payment Dates for Revolving
Credit Loans and Term Loans. . . . . . . . . . . 30
2.10 Computation of Interest and Fees . . . . . . . . 31
2.11 Inability to Determine Interest Rate . . . . . . . 32
2.12 Pro Rata Treatment and Payments. . . . . . . . . . 32
2.13 Illegality . . . . . . . . . . . . . . . . . . . . 34
2.14 Requirements of Law. . . . . . . . . . . . . . . . 35
2.15 Taxes. . . . . . . . . . . . . . . . . . . . . . . 37
2.16 Indemnity. . . . . . . . . . . . . . . . . . . . . 38
2.17 Lenders' Obligation to Mitigate. . . . . . . . . . 39
SECTION 3. REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 39
3.1 Financial Condition. . . . . . . . . . . . . . . . 40
3.2 No Change. . . . . . . . . . . . . . . . . . . . . 41
3.3 Corporate Existence; Compliance with Law . . . . . 41
3.4 Corporate Power; Authorization; Enforceable
Obligations. . . . . . . . . . . . . . . . . . . 41
3.5 No Legal Bar . . . . . . . . . . . . . . . . . . . 42
3.6 Delivery of Merger Agreement and Certain Other
Documents. . . . . . . . . . . . . . . . . . . . 42
3.7 Representations and Warranties Contained in the
Merger Agreement . . . . . . . . . . . . . . . . 43
3.8 Consummation of Merger . . . . . . . . . . . . . . 43
3.9 No Material Litigation . . . . . . . . . . . . . . 43
3.10 No Default . . . . . . . . . . . . . . . . . . . . 43
3.11 Ownership of Property; Liens . . . . . . . . . . . 43
3.12 Taxes. . . . . . . . . . . . . . . . . . . . . . . 43
3.13 Federal Regulations. . . . . . . . . . . . . . . . 44
3.14 ERISA. . . . . . . . . . . . . . . . . . . . . . . 44
3.15 Investment Company Act; Other Regulations. . . . . 45
3.16 Subsidiaries . . . . . . . . . . . . . . . . . . . 45
3.17 Purpose of Loans . . . . . . . . . . . . . . . . . 45
3.18 Environmental Matters. . . . . . . . . . . . . . . 45
3.19 Disclosure . . . . . . . . . . . . . . . . . . . . 46
SECTION 4. CONDITIONS PRECEDENT . . . . . . . . . . . . . . . 47
4.1 Conditions to Initial Loans. . . . . . . . . . . . 47
4.2 Conditions to Each Loan. . . . . . . . . . . . . . 50
SECTION 5. AFFIRMATIVE COVENANTS. . . . . . . . . . . . . . . 51
5.1 Financial Statements . . . . . . . . . . . . . . . 51
5.2 Certificates; Other Information. . . . . . . . . . 52
5.3 Payment of Obligations . . . . . . . . . . . . . . 52
5.4 Conduct of Business and Maintenance of
Existence. . . . . . . . . . . . . . . . . . . . . 53
5.5 Maintenance of Property; Insurance . . . . . . . . 53
5.6 Inspection of Property; Books and Records;
Discussions. . . . . . . . . . . . . . . . . . . 53
5.7 Notices. . . . . . . . . . . . . . . . . . . . . . 53
5.8 Maintenance of Accreditation, Etc. . . . . . . . . 55
5.9 Environmental Laws . . . . . . . . . . . . . . . . 55
SECTION 6. NEGATIVE COVENANTS . . . . . . . . . . . . . . . . 55
6.1 Financial Condition Covenants. . . . . . . . . . . 56
6.2 Limitation on Subsidiary Indebtedness. . . . . . . 56
6.3 Limitation on Sale and Lease-Back Transactions . . 57
6.4 Limitation on Liens. . . . . . . . . . . . . . . . 57
6.5 Limitation on Dividend and Other Payment
Restrictions Affecting Subsidiaries. . . . . . . 59
6.6 Limitation on Fundamental Changes. . . . . . . . . 59
6.7 Limitation on Sale of Assets . . . . . . . . . . . 60
6.8 Limitation on Dividends. . . . . . . . . . . . . . 61
6.9 Limitation on Transactions with Affiliates . . . . 61
SECTION 7. EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . 62
SECTION 8. THE ADMINISTRATIVE AGENT, THE CAF LOAN
AGENT AND THE ARRANGER . . . . . . . . . . . . . 64
8.1 Appointment. . . . . . . . . . . . . . . . . . . . 64
8.2 Delegation of Duties . . . . . . . . . . . . . . . 65
8.3 Exculpatory Provisions . . . . . . . . . . . . . . 65
8.4 Reliance by Administrative Agent and the CAF
Loan Agent . . . . . . . . . . . . . . . . . . . . 65
8.5 Notice of Default. . . . . . . . . . . . . . . . . 66
8.6 Non-Reliance on Administrative Agent, CAF Loan
Agent and Other Lenders. . . . . . . . . . . . . 66
8.7 Indemnification. . . . . . . . . . . . . . . . . . 67
8.8 Administrative Agent and CAF Loan Agent in
Individual Capacity. . . . . . . . . . . . . . . 68
8.9 Successor Administrative Agent and CAF Loan
Agent. . . . . . . . . . . . . . . . . . . . . . . 68
8.10 The Arranger . . . . . . . . . . . . . . . . . . . 68
SECTION 9. MISCELLANEOUS. . . . . . . . . . . . . . . . . . . 69
9.1 Amendments and Waivers . . . . . . . . . . . . . . 69
9.2 Notices. . . . . . . . . . . . . . . . . . . . . . 69
9.3 No Waiver; Cumulative Remedies . . . . . . . . . . 70
9.4 Survival of Representations and Warranties . . . . 70
9.5 Payment of Expenses and Taxes. . . . . . . . . . . 71
9.6 Successors and Assigns; Participations and
Assignments. . . . . . . . . . . . . . . . . . . 72
9.7 Adjustments; Set-off . . . . . . . . . . . . . . . 75
9.8 Counterparts . . . . . . . . . . . . . . . . . . . 76
9.9 Severability . . . . . . . . . . . . . . . . . . . 76
9.10 Integration. . . . . . . . . . . . . . . . . . . . 76
9.11 GOVERNING LAW. . . . . . . . . . . . . . . . . . . 76
9.12 Submission To Jurisdiction; Waivers. . . . . . . . 76
9.13 Acknowledgements . . . . . . . . . . . . . . . . . 77
9.14 WAIVERS OF JURY TRIAL. . . . . . . . . . . . . . . 77
9.15 Schedules. . . . . . . . . . . . . . . . . . . . . 78
9.16 Confidentiality. . . . . . . . . . . . . . . . . . 78
SCHEDULES
I Commitment Amounts and Percentages; Addresses of Lenders
II Subsidiaries of the Borrower and TakeCare
III Existing TakeCare Indebtedness to be Repaid
IV Existing Indebtedness to Remain Outstanding
V Certain Potential Violations
EXHIBITS
A Form of Revolving Credit Note
B Form of Term Note
C Form of CAF Loan Note
D Form of CAF Loan Request
E Form of CAF Loan Offer
F Form of CAF Loan Confirmation
G Form of Closing Certificate
H Form of Assignment and Acceptance
I Form of Opinion of Counsel to the Borrower
J Form of Opinion of General Counsel of the Borrower
