<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1998
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________________ to __________________
Commission File Number: 34-22090
THE MULTICARE COMPANIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 22-3152527
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
101 East State Street
Kennett Square, Pennsylvania 19348
(Address, including zip code, of principal executive offices)
(610) 444-6350
(Registrant's telephone number including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days:
YES [x] NO [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date.
Class Outstanding at February 12, 1999
- ----------------------------- --------------------------------
Common Stock ($.01 Par Value) 100
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Table of Contents
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Page
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CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS .............................1
Part I: FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets
December 31, 1998 (Unaudited) and September 30, 1998 ................2
Consolidated Statements of Operations
Three months ended December 31, 1998 and 1997 (Unaudited) ...........3
Consolidated Statements of Cash Flows
Three months ended December 31, 1998 and 1997 (Unaudited) ...........4
Notes to Consolidated Financial Statements ........................5-7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations ....................................... 8-15
Item 3. Quantitative and Qualitative Disclosures about Market Risk ........16
Part II: OTHER INFORMATION ...........................................................17
SIGNATURES ..................................................................18
</TABLE>
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING STATEMENTS
Certain oral statements made by management from time to time and certain
statements contained herein, including certain statements in "Management's
Discussion and Analysis of Financial Condition and Results of Operations" such
as statements concerning Medicaid and Medicare programs and the Company's
ability to meet its liquidity needs and control costs, certain statements in
"Qualitative and Quantitative Disclosures about Market Risk", certain statements
in Notes to Unaudited Condensed Consolidated Financial Statements, such as
certain Pro Forma Financial Information; and other statements contained herein
regarding matters which are not historical facts are forward looking statements
(as such term is defined in the Securities Act of 1933) and because such
statements involve risks and uncertainties, actual results may differ materially
from those expressed or implied by such forward looking statements. Factors that
could cause actual results to differ materially include, but are not limited to
those discussed below:
1. Changes in the United States healthcare system, including changes in
reimbursement levels under Medicaid and Medicare, implementation of the
Medicare prospective payment system and consolidated billing and other
changes in applicable government regulations that might affect the
profitability of the Company.
2. The Company's substantial indebtedness and significant debt service
obligations.
3. The Company's ability to secure the capital and the related cost of such
capital necessary to fund its future growth through acquisition and
development, as well as internal growth.
4. The Company's continued ability to operate in a heavily regulated
environment and to satisfy regulatory authorities, thereby avoiding a
number of potentially adverse consequences, such as the imposition of
fines, temporary suspension of admission of patients, restrictions on the
ability to acquire new facilities, suspension or decertification from
Medicaid or Medicare programs, and, in extreme cases, revocation of a
facility's license or the closure of a facility, including as a result of
unauthorized activities by employees.
5. The occurrence of changes in the mix of payment sources utilized by the
Company's customers to pay for the Company's services.
6. The adoption of cost containment measures by private pay sources such as
commercial insurers and managed care organizations, as well as efforts by
governmental reimbursement sources to impose cost containment measures.
7. The level of competition in the Company's industry, including without
limitation, increased competition from acute care hospitals, providers of
assisted and independent living and providers of home health care and
changes in the regulatory system, such as changes in certificate of need
laws in the states in which the Company operates or anticipates operating
in the future that facilitate such competition.
8. The Company's ability to identify suitable acquisition candidates, to
consummate or complete development projects, or to profitably operate or
successfully integrate enterprises into the Company's other operations.
9. The Company and its payors' and suppliers ability to implement a Year 2000
readiness program.
These and other factors have been discussed in more detail in the Company's
periodic reports, including its Annual Report on Form 10-K for the fiscal year
ended September 30, 1998
<PAGE>
PART I: FINANCIAL INFORMATION
Item 1. Financial Statements
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Consolidated Balance Sheets
(In thousands, except share data)
<TABLE>
<CAPTION>
December 31, September 30,
1998 1998
------------ -------------
(Unaudited)
<S> <C> <C>
Assets
------
Current Assets:
Cash and cash equivalents $ 10,384 $ 11,344
Accounts receivable, net 123,388 114,210
Prepaid expenses and other current assets 19,148 16,208
Deferred taxes - current portion 1,702 2,117
---------- ----------
Total current assets 154,622 143,879
---------- ----------
Property, plant and equipment, net 718,920 719,112
Goodwill, net 779,766 778,231
Other assets 57,966 57,733
---------- ----------
$1,711,274 $1,698,955
========== ==========
Liabilities and Stockholders' Equity
------------------------------------
Current Liabilities:
Accounts payable $ 33,923 $ 30,188
Accrued liabilities 56,996 60,226
Current portion of long-term debt 31,673 30,647
---------- ----------
Total current liabilities 122,592 121,061
---------- ----------
Long-term debt 735,522 725,194
Deferred taxes 104,718 105,023
Due to Genesis Health Ventures, Inc. and other liabilities 17,782 14,439
Stockholders' Equity:
Common stock, par value $.01, 100 shares authorized
100 shares issued and outstanding --- ---
Additional paid-in-capital 733,000 733,000
Retained earnings (deficit) (2,340) 238
---------- ----------
Total stockholders' equity 730,660 733,238
---------- ----------
$1,711,274 $1,698,955
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited)
(In thousands)
Three Months Ended
December 31,
--------------------
1998 1997
---- ----
Net revenues $168,484 $185,778
Expenses:
Operating expense 129,812 141,343
Management fee 10,051 11,645
Depreciation and amortization 11,281 11,784
Lease expense 3,124 3,443
Interest expense, net 16,185 14,718
-------- --------
Total expenses 170,453 182,933
-------- --------
Earnings (loss) before income taxes (1,969) 2,845
Income tax provision 609 1,487
-------- --------
Net income (loss) $(2,578) $ 1,358
======== ========
See accompanying notes to consolidated financial statements.
3
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)
<TABLE>
<CAPTION>
Three months ended
December 31,
---------------------
1998 1997
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<S> <C> <C>
Cash flows from operating activities:
Net cash provided by (used in) operating activities $ (9,339) $ 12,423
Cash flows from investing activities:
Capital expenditures (5,261) (11,391)
Other assets and liabilities 2,285 (11,981)
-------- ----------
Net cash used in investing activities (2,976) (23,372)
Cash flows from financing activities:
Proceeds from long-term debt 83,705 1,608,675
Repayments of long-term debt (72,350) (874,373)
Equity contribution -- 733,000
Proceeds from sale of therapy business -- 24,000
Purchase of shares in tender offer -- (921,326)
Debt and other financing obligation repayments in connection with merger -- (446,794)
Severance, option payouts and transaction fees in connection with merger -- (91,205)
Debt issuance costs -- (21,582)
-------- ----------
Net cash provided by financing activities 11,355 10,395
-------- ----------
Decrease in cash and cash equivalents (960) (554)
Cash and cash equivalents at beginning of period 11,344 2,118
-------- ----------
Cash and cash equivalents at end of period $ 10,384 $ 1,564
======== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
4
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 1998
(Unaudited)
(In thousands, except share data)
(1) Organization and Basis of Presentation
The Multicare Companies, Inc. and Subsidiaries ("Multicare" or the
"Company") own, operate and manage skilled eldercare and assisted
living facilities which provide long-term care and specialty medical
services in selected geographic regions within the eastern and
midwestern United States. In addition, the Company operated
institutional pharmacies, medical supply companies, outpatient
rehabilitation centers and other ancillary healthcare businesses before
the Merger (as defined below). As a result of the Merger of Genesis
ElderCare Acquisition Corp. with the Company, Genesis Health Ventures,
Inc. ("Genesis") owns approximately 44% of Genesis ElderCare Corp.,
which owns 100% of the outstanding capital stock of the Company. The
Company and Genesis have entered into a management agreement pursuant
to which Genesis manages the Company's operations.
The financial information as of December 31, 1998, and for the three
months ended December 31, 1998 and 1997, is unaudited and has been
prepared in conformity with the accounting principles and practices as
reflected in the Company's audited annual financial statements. The
unaudited financial statements contain all adjustments, consisting only
of normal recurring adjustments, necessary to present fairly the
financial position as of December 31, 1998 and the operating results
for the three months ended December 31, 1998 and 1997 and the cash
flows for the three months ended December 31, 1998 and 1997. Results
for interim periods are not necessarily indicative of those to be
expected for the year.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from these estimates.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these consolidated financial statements be read in conjunction
with the consolidated financial statements and notes thereto
incorporated in the Company's Annual Report on Form 10-K for the fiscal
year ended September 30, 1998.
(2) Tender Offer and Merger and Recent Acquisitions
On October 9, 1997, Genesis ElderCare Acquisition Corp. ("Acquisition
Corp."), a wholly-owned subsidiary of Genesis ElderCare Corp., a
Delaware corporation formed by Genesis Health Ventures, Inc.
("Genesis"), The Cypress Group L.L.C. (together with its affiliates,
"Cypress"), TPG Partners II, L.P. (together with its affiliates,
"TPG"), and Nazem, Inc. (together with its affiliates, "Nazem"),
acquired 99.65% of the shares of common stock of Multicare, pursuant to
a tender offer commenced on June 20, 1997 (the "Tender Offer"). On
October 10, 1997, Genesis ElderCare Corp. completed the merger (the
"Merger") of Acquisition Corp. with and into Multicare in accordance
with the Agreement and Plan of Merger (the "Merger Agreement") dated as
of June 16, 1997 by and among Genesis ElderCare Corp., Acquisition
Corp., Genesis and Multicare. Upon consummation of the Merger,
Multicare became a wholly-owned subsidiary of Genesis ElderCare Corp.
In connection with the Merger, Multicare and Genesis entered into a
management agreement (the "Management Agreement") pursuant to which
Genesis manages Multicare's operations. The Management Agreement has a
term of five years with automatic renewals for two years unless either
party terminates the Management Agreement.
5
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Notes to Consolidated Financial Statements, Continued.
(2) Tender Offer and Merger and Recent Acquisitions, Continued
Genesis earns a fee of six percent of Multicare's net revenues for its
services under the Management Agreement provided that payment of such
fee in respect of any month in excess of the greater of (i) $1,992 and
(ii) four percent of Multicare's consolidated net revenues for such
month, shall be subordinate to the satisfaction of Multicare's senior
and subordinate debt covenants; and provided, further, that payment of
such fee shall be no less than $23,900 in any given year. Under the
Management Agreement, Genesis is responsible for Multicare's
non-extraordinary sales, general and administrative expenses (other
than certain specified third-party expenses), and all other expenses of
Multicare are paid by Multicare. Genesis also entered into an asset
purchase agreement (the "Therapy Sale Agreement") with Multicare and
certain of its subsidiaries pursuant to which Genesis acquired all of
the assets used in Multicare's outpatient and inpatient rehabilitation
therapy business for $24,000 subject to adjustment (the "Therapy Sale")
and a stock purchase agreement (the "Pharmacy Sale Agreement") with
Multicare and certain subsidiaries pursuant to which Genesis acquired
all of the outstanding capital stock and limited partnership interests
of certain subsidiaries of Multicare that are engaged in the business
of providing institutional pharmacy services to third parties for
$50,000 subject to adjustment (the "Pharmacy Sale"). The Company
completed the Pharmacy Sale effective January 1, 1998.
Genesis ElderCare Corp. (the "Multicare Parent") paid approximately
$1,492,000 to (i) purchase the shares pursuant to the Tender Offer and
the Merger, (ii) pay fees and expenses incurred in connection with the
completion of the Tender Offer, Merger and the financing transactions
in connection therewith, (iii) refinance certain indebtedness of
Multicare and (iv) make certain cash payments to employees. Of the
funds required to finance the foregoing, approximately $733,000 were
furnished to Acquisition Corp. as capital contributions by the
Multicare Parent from the sale by Genesis ElderCare Corp. of its Common
Stock ("Genesis ElderCare Corp. Common Stock") to Cypress, TPG, Nazem
and Genesis. Cypress, TPG and Nazem purchased shares of Genesis
ElderCare Corp. Common Stock for a purchase price of $210,000, $199,500
and $10,500, respectively, and Genesis purchased shares of Genesis
ElderCare Corp. Common Stock for a purchase price of $325,000 in
consideration for approximately 44% of the Common Stock of the
Multicare Parent. The balance of the funds necessary to finance the
foregoing came from (i) the proceeds of loans from a syndicate of
lenders in the aggregate amount of $525,000 and (ii) $246,800 from the
sale of 9% Senior Subordinated Notes due 2007 (the "9% Notes") sold by
Acquisition Corp. on August 11, 1997.
In connection with the Merger, Genesis, Cypress, TPG and Nazem entered
into an agreement (the "Put/Call Agreement") pursuant to which, among
other things, Genesis will have the option, on the terms and conditions
set forth in the Put/Call Agreement, to purchase (the "Call") Genesis
ElderCare Corp. Common Stock held by Cypress, TPG and Nazem commencing
on October 9, 2001 and for a period of 270 days thereafter, at a price
determined pursuant to the terms of the Put/Call Agreement. Cypress,
TPG and Nazem will have the option, on the terms and conditions set
forth in the Put/Call Agreement, to require Genesis to purchase (the
"Put") such Genesis ElderCare Corp. Common Stock commencing on October
9, 2002 and for a period of one year thereafter, at a price determined
pursuant to the Put/Call Agreement.
The prices determined for the Put and Call are based on a formula that
calculates the equity value attributable to Cypress', TPG's and Nazem's
Genesis ElderCare Corp. Common Stock, plus a portion of the Genesis
pharmacy business (the "Calculated Equity Value"). The Calculated
Equity Value will be determined based upon a multiple of Genesis
ElderCare Corp.'s earnings before interest, taxes, depreciation,
amortization and rental expenses, as adjusted ("EBITDAR") after
deduction of certain liabilities, plus a portion of the EBITDAR related
to the Genesis pharmacy business. The multiple to be applied to EBITDAR
will depend on whether the Put or the Call is being exercised. Any
payment to Cypress, TPG or Nazem under the Call or the Put may be in
the form of cash or Genesis common stock at Genesis' option.
6
<PAGE>
(2) Tender Offer and Merger and Recent Acquisitions, Continued
Upon exercise of the Call, Cypress, TPG and Nazem will receive at a
minimum their original investment plus a 25% compound annual return
thereon regardless of the Calculated Equity Value. Any additional
Calculated Equity Value attributable to Cypress', TPG's or Nazem's
Genesis ElderCare Corp. Common Stock will be determined on the basis
set forth in the Put/Call Agreement which provides generally for
additional Calculated Equity Value of Genesis ElderCare Corp. to be
divided based upon the proportionate share of the capital contributions
of the stockholders to Genesis ElderCare Corp. Upon exercise of the Put
by Cypress, TPG or Nazem, there will be no minimum return to Cypress,
TPG or Nazem; any payment to Cypress, TPG or Nazem will be limited to
Cypress', TPG's or Nazem's share of the Calculated Equity Value based
upon a formula set forth in the terms of the Put/Call Agreement.
Cypress', TPG's and Nazem's rights to exercise the Put will be
accelerated upon an event of bankruptcy of Genesis, a change of control
of Genesis or an extraordinary dividend or distribution or the
occurrence of the leverage recapitalization of Genesis. Upon an event
of acceleration or the failure by Genesis to satisfy its obligations
upon exercise of the Put, Cypress, TPG and Nazem will have the right to
terminate the Stockholders' Agreement and Management Agreement and to
control the sale or liquidation of Genesis ElderCare Corp. In the event
of such sale, the proceeds from such sale will be distributed among the
parties as contemplated by the formula for the Put option exercise
price and Cypress, TPG and Nazem will retain a claim against Genesis
for the difference, if any, between the proceeds of such sale and the
Put option exercise price.
The following 1998 pro forma financial information has been prepared as
if the Pharmacy Sale had been completed on October 1, 1997. The pro
forma financial information does not necessarily reflect the results of
operations that would have occurred had the transactions occurred at
the beginning of the respective periods presented.
Three months ended
December 31,
1997
------------------
Net revenues $166,036
Income before income taxes 1,764
Net income $ 847
7
<PAGE>
THE MULTICARE COMPANIES, INC.
AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
General
Upon consummation of the Merger, the Company and Genesis entered into the
Management Agreement pursuant to which Genesis manages the Company's operations.
Under Genesis' management, the Company's strategy is to integrate the talents of
case managers, comprehensive discharge planning and, to provide cost effective
care management to achieve superior outcomes and return the Company's customers
to the community. Genesis' management believes that achieving improved customer
outcomes will result in increased utilization of specialty medical services and
a broader base of repeat customers in the Company's network. Moreover, the
Company believes that this strategy will lead to a high quality payor mix and
continued high levels of occupancy. Genesis' management also will focus on the
revenue and cost opportunities presented through the further integration of the
Company's acquisitions. It is contemplated that the Company will do little, if
any, new acquisitions or new construction after the Merger; accordingly, capital
expenditures after the Merger have decreased significantly from historical
levels.
The Tender Offer and Merger
On October 9, 1997 Acquisition Corp., Cypress, TPG and Nazem acquired 99.65% of
the shares of common stock of Multicare, pursuant to the Tender Offer commenced
on June 20, 1997. On October 10, 1997, Genesis ElderCare Corp. completed the
Merger of Acquisition Corp. with and into Multicare in accordance with the
Merger Agreement. Upon consummation of the Merger, Multicare became a
wholly-owned subsidiary of Genesis ElderCare Corp. Multicare is in the business
of providing eldercare and specialty medical services in selected geographic
regions.
In connection with the Merger, Multicare and Genesis entered into the Management
Agreement pursuant to which Genesis manages Multicare's operations. The
Management Agreement has a term of five years with automatic renewals for two
years unless either party terminates the Management Agreement. Genesis is paid
a fee of six percent of Multicare's net revenues for its services under the
Management Agreement provided that payment of such fee in respect of any month
in excess of the greater of (i) $1,991,666 and (ii) four percent of Multicare's
consolidated net revenues for such month, shall be subordinate to the
satisfaction of Multicare's senior and subordinate debt covenants; and provided,
further, that payment of such fee shall be no less than $23,900,000 million in
any given year. Under the Management Agreement, Genesis is responsible for
Multicare's non-extraordinary sales, general and administrative expenses (other
than certain specified third-party expenses), and all other expenses of
Multicare are paid by Multicare. Genesis also entered into the Therapy Sale
Agreement with Multicare and certain of its subsidiaries pursuant to which
Genesis acquired all of the assets used in Multicare's outpatient and inpatient
rehabilitation therapy business for $24,000,000 subject to adjustment and the
Pharmacy Sale Agreement with Multicare and certain subsidiaries pursuant to
which Genesis will acquire all of the outstanding capital stock and limited
partnership interest of certain subsidiaries of Multicare that are engaged in
the business of providing institutional pharmacy services to third parties for
$50,000,000, subject to adjustment. The Company completed the Therapy Sale and
the Pharmacy Sale effective October 1, 1997 and January 1, 1998, respectively.
Genesis ElderCare Corp. (the "Multicare Parent") paid approximately
$1,492,000,000 to (i) purchase the shares pursuant to the Tender Offer and the
Merger, (ii) pay fees and expenses incurred in connection with the completion of
the Tender Offer, Merger and the financing transactions in connection with
therewith, (iii) refinance certain indebtedness of Multicare and (iv) make
certain cash payments to employees. Of the funds required to finance the
foregoing, approximately $733,000,000 were furnished to Acquisition Corp. as
capital contributions by the Multicare Parent from the sale by Genesis ElderCare
Corp. of its Common Stock ("Genesis Eldercare Corp. Common Stock") to Cypress,
TPG, Nazem and Genesis. Cypress, TPG and Nazem purchased shares of Genesis
ElderCare Corp. common stock for a purchase price of $210,000,000, $199,500,000
and $10,500,000, respectively, and Genesis purchased shares of Genesis ElderCare
Corp. common stock for a purchase price of $325,000,000 in consideration for
approximately 44% of the common stock of the Multicare Parent. The balance of
the funds necessary to finance the foregoing came from (i) the proceeds of loans
from a syndicate of lenders in the aggregate amount of $525,000,000 and (ii)
$250,000,000 from the sale of 9% Senior Subordinated Notes due 2007 (the "9%
Notes") sold by Acquisition Corp. on August 11, 1997.
8
<PAGE>
Results of Operations
Net revenues. Net revenues for the three months ended December 31, 1998
decreased $17.3 million or 9.3% from the same period last year to $168.5
million. The decrease in revenues in the first quarter of fiscal 1999 is
comprised of approximately $20.8 million relating to the exclusion of the
results of the pharmacy business due to the Pharmacy Sale offset by
approximately $3.5 million of internal growth. The internal growth of revenues
resulted mainly from increases in payor rates and development and opening of
additional beds.
The average rate per patient day increased $2 per day from the same period last
year. The Company's quality mix of private, Medicare and insurance patient days
was 41.4% of patient days for the three months ended December 31, 1998 compared
to 43.6% in the similar period of last year. Occupancy rates were 91.1% for the
three months ended December 31, 1998 compared to 92.0% in the similar period of
last year.
Operating Expense. Operating expenses for the three months ended December 31,
1998 decreased $11.5 million or 8.2% from the comparable period last year to
$129.8 million. A decrease of $16.3 million relates to the exclusion of results
for the pharmacy businesses due to the Pharmacy Sale. The offsetting increase
resulted primarily from higher salaries, wages and benefits and expanded nursing
staffing levels to support higher patient acuities and more complex product
lines such as subacute and Alzheimers care. Facility operating margins were
23.0% and 23.9% for the three months ended December 31, 1998 and 1997,
respectively.
Management Fee. In connection with the Management Agreement, Genesis manages
Multicare's operations for a fee of approximately six percent of Multicare's
non-extraordinary (as defined by the Management Agreement) sales and is
responsible for Multicare's corporate general and administrative expenses other
than certain specified third party expenses. Management fees decreased by $1.6
million or 14% to $10.1 million, due to the exclusion of the results of the
pharmacy business due to the Pharmacy Sale.
Lease Expense. Lease expense for the three months ended December 31, 1998
decreased 9.3% to $3.1 million. The decrease relates to the sale of certain
leased facilities in connection with the Pharmacy Sale.
Depreciation and Amortization. Depreciation and amortization expense for the
three months ended December 31, 1998 decreased $0.5 or 4.3% from the prior
period to $11.3 million. Depreciation decreased due to the sale of certain
plant, property, and equipment in connection with the Pharmacy Sale.
Interest Expense, net. Interest expense, net for the three months ended December
31, 1998 increased $1.5 million or 10% to $16.2 million from the same period in
the prior year. The increase is due to the increase in average debt balance of
approximately $58 million in the current year period over the prior period. This
is due in part to incremental borrowings incurred to finance the Merger which
was not outstanding for the entire prior quarter.
Income Tax Expense. The provision for income taxes decreased by $0.9 million to
$0.6 million due to lower anticipated pre-tax earnings in the current year. The
majority of the tax provision relates to non-deductible goodwill amortization
resulting from the Merger which is partially offset in the current year by a tax
benefit related to the loss before income taxes.
Liquidity and Capital Resources
The Company maintains adequate working capital from operating cash flows and
lines of credit for continuing operations, debt service, and anticipated capital
expenditures. At December 31, 1998 and September 30, 1998, the Company had
working capital of $32.0 and $22.8 million, respectively.
Cash flow used in operations was $9.3 million for the three months ended
December 31, 1998 compared to cash flow provided by operations of $12.4 million
in the prior period. Net accounts receivable at December 31, 1998 were $123.4
million compared to $114.2 million as of September 30, 1998. The increase in net
accounts receivable is attributable to the timing of third-party interim and
settlement payments and the utilization of specialty medical services for higher
acuity level patients. Legislative and regulatory action and government
budgetary constraints will change the timing of payments and reimbursement rates
of the Medicare and Medicaid programs in the future. These changes could have a
material adverse effect on the Company's future operating results and cash
flows.
9
<PAGE>
In connection with the Merger, Multicare entered into three term loans and a
revolving credit facility of up to $525 million, in the aggregate (collectively,
the "Senior Facilities"), provided by a syndicate of banks and other financial
institutions (collectively, the "Lenders") led by Mellon Bank, N.A., as
administrative agent (the "Administrative Agent"), pursuant to a certain credit
agreement (the "Long Term Credit Agreement") dated as of October 14, 1997. The
Senior Facilities were provided for the purpose of (i) refinancing certain
short term facilities in the aggregate principal amount of $431.6 million which
were funded on October 9, 1997 to acquire the Shares in the Tender Offer,
refinance certain indebtedness of Multicare (including the Company's bank credit
and lease facilities with NationsBank, N.A. the Company's 7% Convertible
Subordinated Debentures and the Company's 12.5% Senior Subordinated Notes) and
pay fees and expenses related to the transactions, (ii) funding interest and
principal payments on such facilities and on certain remaining indebtedness and
(iii) funding working capital and general corporate purposes.
The Senior Facilities consist of: (1) a $169 million six year term loan (the
"Tranche A Term Facility"); (2) a $148.1 million seven year term loan (the
"Tranche B Term Facility"); (3) a $49.2 million term loan maturing on June 1,
2005 (the "Tranche C Term Facility"); (4) a $125 million six year revolving
credit facility (the "Revolving Credit Facility") which includes Swing Loans
(collectively, the "Swing Loan Facility") in integral principal multiples of
$500,000 up to an aggregate unpaid principal amount of $10 million. The Tranche
A Term Facility, Tranche B Term Facility and Tranche C Term Facility are subject
to amortization in quarterly installments, commencing at the end of the first
calendar quarter after the date of the consummation of the Merger. The Revolving
Credit Facility will mature on September 30, 2003. All net proceeds received by
Multicare from (i) the sale of assets of Multicare or its subsidiaries other
than sales in the ordinary course of business (and other than the sales of
Multicare's rehabilitation therapy business and pharmacy business to the extent
that there are amounts outstanding under the Revolving Credit Facility) and (ii)
any sale of common stock or debt securities of Multicare in respect of common
stock will be applied as a mandatory prepayment. Fifty percent of Excess Cash
Flow must be applied to the Senior Facilities and shall be payable annually.
The Long Term Credit Agreement contains a number of covenants that, among other
things, restrict the ability of Multicare and its subsidiaries to dispose of
assets, incur additional indebtedness, make loans and investments, pay
dividends, engage in mergers or consolidations, engage in certain transactions
with affiliates and change control of capital stock, prepay debt, make material
changes in accounting and reporting practices, create liens on assets, give a
negative pledge on assets, make acquisitions and amend or modify documents. In
addition, the Long Term Credit Agreement requires that Multicare and its
affiliates maintain the Management Agreement as well as comply with certain
financial covenants. The Third Amendment to the Credit Facility ("the
Amendment"), effective February 12, 1999, made the financial covenants for
certain periods less restrictive.
The Senior Facilities are secured by a first priority security interest in all
of the (i) stock of Multicare, (ii) stock, partnership interests and other
equity of all of Multicare's present and future direct and indirect subsidiaries
and (iii) intercompany notes among Genesis ElderCare Corp. and any subsidiaries
or among any subsidiaries. Loans under the Senior Facilities bear, at
Multicare's option, interest at the per annum Prime Rate as announced by the
Administrative Agent, or the applicable Adjusted LIBO Rate. Effective with the
Amendment on February 12, 1999 the loans under the Tranche A Term Facility bear
interest at a rate equal to the Prime Rate plus a margin of .75% or the LIBO
Rate plus a margin of 3.0%; loans under the Tranche B Term Facility bear
interest at a rate equal to Prime Rate plus 1.5% or LIBO Rate plus a margin of
3.25%; loans under the Tranche C Term Facility bear interest at a rate equal to
Prime Rate plus 1.25% or LIBO Rate plus a margin up to 3.5%; loans under the
Revolving Credit Facility bear interest at a rate equal to Prime Rate plus .75%
or LIBO Rate plus a margin up to 3.0%; and loans under the Swing Loan Facility
bear interest at the Prime Rate unless otherwise agreed to by the parties.
Subject to meeting certain financial covenants, the above-referenced interest
rates will be reduced.
On August 11, 1997, Acquisition Corp. sold $250 million principal amount of 9%
Senior Subordinated Notes due 2007 (the "9% Notes") which were issued pursuant
to the Indenture. Interest on the 9% Notes is payable semiannually on February 1
and August 1 of each year.
10
<PAGE>
The 9% Notes are unsecured, general obligations of the issuer, subordinated in
right of payment to all existing and future Senior Indebtedness, as defined in
the Indenture, of the issuer, including indebtedness under the Senior
Facilities. The 9% Notes rank pari passu in right of payment with any future
senior subordinated indebtedness of the issuer and are senior in right of
payment to all future subordinated indebtedness of the issuer. The 9% Notes are
redeemable at the option of the issuer, in whole or in part, at any time on or
after August 1, 2002, initially at 104.5% of their principal amount, plus
accrued interest, declining ratably to 100% of their principal amount, plus
accrued interest, on or after August 1, 2004. The 9% Notes are subject to
mandatory redemption at 101%. Upon a Change in Control, as defined in the
Indenture, the issuer is required to make an offer to purchase the 9% Notes at a
purchase price equal to 101% of their principal amount, plus accrued interest.
The Indenture contains a number of covenants that, among other things, restrict
the ability of the issuer of the 9% Notes to incur additional indebtedness, pay
dividends, redeem capital stock, make certain investments, issue the capital
stock of its subsidiaries, engage in mergers or consolidations or asset sales,
engage in certain transactions with affiliates, and create dividend and other
restrictions affecting its subsidiaries.
Upon the consummation of the Merger, Multicare assumed all obligations of
Acquisition Corp. with respect to and under the 9% Notes and the related
Indenture.
On October 9, 1997, Multicare, Genesis and Genesis ElderCare Network Services,
Inc., a wholly-owned subsidiary of Genesis, entered into a management agreement
(the "Management Agreement") pursuant to which Genesis manages Multicare's
operations. The Management Agreement has a term of five years with automatic
renewals for two years unless either party terminates the Management Agreement.
Genesis is paid a fee of six percent of Multicare's net revenues for its
services under the Management Agreement provided that payment of such fee in
respect of any month in excess of the greater of (i) $1.992 million and (ii)
four percent of Multicare's consolidated net revenues for such month, is
subordinate to the satisfaction of Multicare's senior and subordinate debt
covenants; and provided, further, that payment of such fee shall be no less than
$23.9 million in any given year. At December 31, 1998 $17.4 million is
subordinated and due to Genesis. Under the Management Agreement, Genesis is
responsible for Multicare's non-extraordinary sales, general and administrative
expenses (other than certain specified third-party expenses), and all other
expenses of Multicare are paid by Multicare.
On October 10, 1997, Genesis entered into the Therapy Sale pursuant to which
Genesis acquired all of the assets used in Multicare's outpatient and inpatient
rehabilitation therapy business for $24 million, subject to adjustment.
On October 10, 1997, Genesis and one of its wholly-owned subsidiaries entered
into the Pharmacy Sale pursuant to which Genesis acquired all of the outstanding
capital stock and limited partnership interests of certain subsidiaries of
Multicare that were engaged in the business of providing institutional pharmacy
services to third parties for $50 million, subject to adjustment (the "Pharmacy
Sale"). The Company completed the Pharmacy Sale effective January 1, 1998.
In February 1998 ElderTrust ("ETT"), a Maryland real estate investment trust
sponsored by Genesis, made term loans to subsidiaries of the Company with
respect to the lease-up of three assisted living facilities. The loans have a
fixed annual rate of interest of 10.5% and mature three years from the date of
the loans, subject to the right of the Company to extend the term for up to
three one-year extension periods in the event the facility has not reached
"stabilized occupancy" (as defined) as of the third anniversary of the loan (or
at the end of any extension period, if applicable).
ETT is obligated to purchase and leaseback the three facilities that secure the
term and construction loans being made to the Company, upon the earlier of the
facility reaching stabilized occupancy or the maturity of the loan secured by
the facility provided, however, that the Company will not be obligated to sell
any facility if the purchase price for the facility would be less than the
applicable loan amount. The purchase agreements provide for a cash purchase
price in an amount which will result in an annual yield of 10.5% to ETT. If
acquired by ETT, these facilities would be leased to the Company under minimum
rent leases. The initial term of any minimum rent lease will be ten years, and
the Company will have the option to extend the term for up to two five-year
extension periods upon 12 months notice to ETT. Minimum rent for the first lease
year under any minimum rent lease will be established by multiplying the
purchase price for the applicable facility times 10.5%, and the increase each
year by an amount equal to the lesser of (i) 5% of the increase in the gross
revenues for such facility (excluding any revenues derived from ancillary
healthcare services provided by Genesis or its affiliates to residents of the
applicable facility) during the immediately preceding year or (ii) one-half of
the increase in the Consumer Price Index during the immediately preceding year.
During the last four years of the term (as extended, if applicable), the Company
is required to make minimum capital expenditures equal to $3,000 per residential
unit in each assisted living facility covered by a minimum rent lease.
11
<PAGE>
Legislative and regulatory action has resulted in continuing change in the
Medicare and Medicaid reimbursement programs which has adversely impacted the
Company. The changes have limited, and are expected to continue to limit,
payment increases under these programs. Also, the timing of payments made under
the Medicare and Medicaid programs is subject to regulatory action and
governmental budgetary constraints; in recent years, the time period between
submission of claims and payment has increased. Within the statutory framework
of the Medicare and Medicaid programs, there are substantial areas subject to
administrative rulings and interpretations which may further affect payments
made under those programs. Further, the federal and state governments may reduce
the funds available under those programs in the future or require more stringent
utilization and quality reviews of eldercare centers or other providers. There
can be no assurances that adjustments from Medicare or Medicaid audits will not
have a material adverse effect on the Company.
Pursuant to the Balanced Budget Act of 1997 (the "Balanced Budget Act")
commencing with cost reporting periods beginning on July 1, 1998, PPS began to
be phased in for skilled nursing facilities at a per diem rate for all covered
Part A skilled nursing facility services as well as many services for which
payment may be made under Part B when a beneficiary who is a resident of a
skilled nursing facility receives covered skilled nursing facility care. The
consolidated per diem rate is adjusted based upon the Resource Utilization Group
("RUG"). In addition to covering skilled nursing facility services, this
consolidated payment will also cover rehabilitation and non-rehabilitation
ancillary services. Physician services, certain nurse practitioner and physician
assistant services, among others, are not included in the per diem rate. For the
first three cost reporting periods beginning on or after July 1, 1998, the per
diem rate will be based on a blend of a facility specific-rate and a federal per
diem rate. In subsequent periods, and for facilities first receiving payments
for Medicare services on or after October 1, 1995, the federal per diem rate
will be used without any facility specific blending.
The Balanced Budget Act also required consolidated billing for skilled nursing
facilities. Under the Balanced Budget Act, the skilled nursing facility must
submit all Medicare claims for Part A and Part B services received by its
residents with the exception of physician, nursing, physician assistant and
certain related services, even if such services were provided by outside
suppliers. Medicare will pay the skilled nursing facilities directly for all
services on the consolidated bill and outside suppliers of services to residents
of the skilled nursing facilities must collect payment from the skilled nursing
facility. Although consolidated billing was scheduled to begin July 1, 1998 for
all services, it has been delayed until further notice for beneficiaries in a
Medicare Part A stay in a skilled nursing facility not yet using PPS and for the
Medicare Part B stay. There can be no assurance that the Company will be able to
provide skilled nursing services at a cost below the established Medicare level.
Based upon the Company's recent experience with 7 eldercare centers that
transitioned to PPS effective July 1, 1998 and based upon the Company's ongoing
budget process for its fiscal year ending September 30, 1999, the Company
believes that the impact of PPS on the Company's future earnings is likely to be
greater than originally anticipated by management due to various factors,
including lower than anticipated Medicare per diem revenues, lower than
anticipated Medicare Part B revenues caused by a census shift to Medicare
patients having a greater length of stay, higher than expected ancillary costs
at the centers due to expanded services covered in the Medicare Part A rates,
lower than anticipated routine cost reductions and lower than expected revenues
for contract therapy services.
Based upon assumptions, the Company estimates that the adverse revenue impact of
PPS in Fiscal 1999 will be approximately $18 million. The Company estimates that
the adverse revenue impact of PPS will be approximately an additional $13
million in Fiscal 2000 and an additional $5 million in each of Fiscal 2001 and
2002. The majority of the Multicare eldercare centers began implementation of
PPS on January 1, 1999. The actual impact of PPS on the Company's earnings in
Fiscal 1999 will depend on many variables which can not be quantified at this
time, including regulatory changes, patient acuity, patient length of stay,
Medicare census, referral patterns, and ability to reduce costs.
12
<PAGE>
Effective April 10, 1998, regulations were adopted by the Health Care Financing
Administration, which revise the methodology for determining the reasonable cost
for contract therapy services, including physical therapy, respiratory therapy,
occupational therapy and speech language pathology. Under the regulations, the
reasonable costs for contract therapy services are limited to
geographically-adjusted salary equivalency guidelines. However, the revised
salary equivalency guidelines will no longer apply when the PPS system
applicable to the particular setting for contract therapy services (e.g. skilled
nursing facilities, home health agencies, etc.) goes into effect.
The Balanced Budget Act also repealed the Boren Amendment federal payment
standard for Medicaid payments to Medicaid nursing facilities effective October
1, 1997. The Boren Amendment required Medicaid payments to certain health care
providers to be reasonable and adequate in order to cover the costs of
efficiently and economically operated health care facilities. States must now
use a public notice and comment period in order to determine rates and provide
interested parties a reasonable opportunity to comment on proposed rates and the
justification for and the methodology used in calculating such rates. There can
be no assurance that budget constraints or other factors will not cause states
to reduce Medicaid reimbursement to nursing facilities and pharmacies or that
payments to nursing facilities and pharmacies will be made on timely basis. The
law also grants greater flexibility to states to establish Medicaid managed care
projects without the need to obtain a federal waiver. Although these waiver
projects generally exempt institutional care, including nursing facilities and
institutional pharmacy services, no assurances can be given that these projects
ultimately will not change the reimbursement system for long-term care,
including pharmacy services from fee-for-service to managed care negotiated or
capitated rates. The Company anticipates that federal and state governments will
continue to review and assess alternative health care delivery systems and
payment methodologies.
In July 1998, the Clinton Administration issued a new initiative to promote the
quality of care in nursing homes. This initiative includes, but is not limited
to (i) increased enforcement of nursing home safety and quality regulations;
(ii) increased federal oversight of state inspections of nursing homes; (iii)
prosecution of egregious violations of regulations governing nursing homes; (iv)
the publication of nursing home survey results on the Internet; and (v)
continuation of the development of the Minimum Data Set ("MDS"), a national
automated clinical data system. Accordingly, with this new initiative, it may
become more difficult for eldercare facilities to maintain licensing and
certification. The Company may experience increased costs in connection with
maintaining its licenses and certifications as well as increased enforcement
actions. In addition, beginning January 1, 1999, outpatient therapy services
furnished by a skilled nursing facility to a resident not under a covered Part A
stay or to non-residents who receive outpatient rehabilitation services will be
paid according to the Medicare Physician Fee Schedule.
The Company believes that its liquidity needs can be met by expected operating
cash flow and availability of borrowings under its credit facilities. At January
31, 1999, approximately $97.3 million was outstanding under the Senior
facilities, and approximately $21.8 million was available under the credit
facilities after giving effect to approximately $5.8 million in outstanding
letters of credit issued under the credit facilities.
Seasonality
The Company's earnings generally fluctuate from quarter to quarter. This
seasonality is related to a combination of factors which include the timing of
Medicaid rate increases, seasonal census cycles, and the number of calendar days
in a given quarter.
Impact of Inflation
The healthcare industry is labor intensive. Wages and other labor costs are
especially sensitive to inflation and marketplace labor shortages. To date, the
Company has offset its increased operating costs by increasing charges for its
services and expanding its services. Genesis has also implemented cost control
measures to limit increases in operating costs and expenses but cannot predict
its ability to control such operating cost increases in the future.
13
<PAGE>
Year 2000 Compliance
The Company has implemented a process to address its Year 2000 compliance
issues. The process includes (i) an inventory and assessment of the compliance
of essential systems and equipment of the Company and of year 2000 mission
critical suppliers and other third parties, (ii) the remediation of
non-compliant systems and equipment, and (iii) contingency planning.
The Company's Year 2000 compliance work is being performed and paid for by
Genesis, manager of the Company's operations under the terms of a long-term
management agreement. Genesis is in the process of conducting an inventory,
assessment and remediation of its information technology ("IT") systems,
equipment and non-IT systems and equipment (embedded technology). It has
completed approximately 70% of its internal inventory and approximately 30% of
its assessment of the systems and equipment of critical suppliers and other
third parties.
With respect to the Year 2000 compliance of critical third parties, the Company
derives a substantial portion of its revenues from the Medicare and Medicaid
programs. Congress' General Accounting Office recently concluded that it is
highly unlikely that all Medicare systems will be compliant on time to ensure
the delivery of uninterrupted benefits and services into the Year 2000. While
the Company does not receive payments directly from Medicare, but from
intermediaries, the GAO statement is interpreted to apply as well to these
intermediaries. The Company intends to actively confirm the Year 2000 readiness
status for each intermediary and to work cooperatively to ensure appropriate
continuing payments for services rendered to all government-insured patients.
The Company is remediating its critical IT and non-IT systems and equipment. The
Company has also begun contingency planning in the event that essential systems
and equipment fail to be year 2000 compliant. The Company is planning to be Year
2000 complaint for all its essential systems and equipment by September 30,
1999, although there can be no assurance that it will achieve its objective by
such date or by January 1, 2000, or that such potential non-compliance will not
have a material adverse effect on the Company's business, financial condition or
results of operations. In addition there can be no assurance that all of the
Company's critical suppliers, and other third parties will be Year 2000
complaint by January 1, 2000, or that such potential non-compliance will not
have a material adverse effect on the Company's business, financial condition or
results of operations. The Company's analysis of its Year 2000 issues is based
in part on information from third party suppliers; there can be no assurance
that such information is accurate or complete.
The failure of the Company or third parties to be fully Year 2000 compliant for
essential systems and equipment by January 1, 2000 could result in interruptions
of normal business work operations. The Company's potential risks include (i)
the inability to deliver patient care-related services in the Company's
facilities and/or in non-affiliated facilities, (ii) the delayed receipt of
reimbursement from the Federal or State governments, private payors, or
intermediaries, (iii) the failure of security systems, elevators, heating
systems or other operational systems and equipment and (iv) the inability to
receive equipment and supplies from vendors. Each of these events could have a
material adverse affect on the Company's care-related business, results of
operations and financial condition.
Contingency plans for the Company's Year 2000-related issues continue to be
developed and include, but are not limited to, identification of alternate
suppliers, alternate technologies and alternate manual systems. The Company is
planning to have contingency plans completed for essential systems and equipment
by June 30, 1999; however, there can be no assurance that it will meet this
objective by such date or by January 1, 2000.
The Year 2000 disclosure set forth above is intended to be a "Year 2000
statement" as such term is defined in the Year 2000 Information and Readiness
Disclosure Act of 1998 (the "Year 2000 Act") and, to the extent such disclosure
relates to year 2000 processing of the Company or to products or services
offered by the Company, is also intended to be "Year 2000 readiness disclosure"
as such term is defined in the Year 2000 Act.
14
<PAGE>
New Accounting Pronouncements
In June 1997, the Financial Accounting Standards Board ("FASB") issued Statement
of Financial Accounting Standards No. 130, Reporting Comprehensive Income
("Statement 130"). This Statement requires that all items that are required to
be recognized under accounting standards as components of comprehensive income
be reported in a financial statement that is displayed with the same prominence
as other financial statements. This Statement is effective for fiscal years
beginning after December 15, 1997 or the Company's fiscal year ending September
30, 1999. The Company plans to adopt this accounting standard as required. The
adoption of this standard will have no impact on the Company's earnings,
financial condition or liquidity, but will require the Company to classify items
of other comprehensive income in a financial statement and display the
accumulated balance of other comprehensive income separately in the equity
section of the balance sheet.
In June 1997, the FASB also issued Statement of Financial Accounting Standards
No. 131, Disclosures about Segments of an Enterprise and Related Information
("Statement 131"). Statement 131 supersedes Statement of Financial Standards No.
14, Financial Reporting for Segments of a Business Enterprise, and establishes
new standards for reporting information about operation segments in annual
financial statements and requires selected information about operating segments
in interim financial reports. Statement 131 also establishes standards for
related disclosures about products and services, geographic areas and major
customers. Statement 131 is effective for periods beginning after December 15,
1997, or the Company's fiscal year end September 30, 1999. This Statement will
have no impact on the Company's financial statements, results of operations,
financial condition or liquidity.
In April 1998, the Accounting Standards Executive Committee issued Statement of
Position 98-5, Reporting on the Costs of Start-up Activities ("SOP 98-5"). SOP
98-5 requires costs of start-up activities, including organizational costs, to
be expensed as incurred. Start-up activities are defined as those one-time
activities related to opening a new facility, introducing a new product or
service, conducting business in a new territory, conducting business with a new
process in an existing facility, or commencing a new operation. SOP 98-5 is
effective for fiscal years beginning after December 15, 1998 or the Company's
fiscal year ending September 30, 2000. The Company currently estimates the
adoption of SOP 98-5 will result in a change of approximately $2.1 million net
of tax which will be recorded as a cumulative effect of a change in accounting
principle.
In June 1998, the FASB issued Statement of Financial Accounting Standards No.
133, Accounting for Derivative Instruments and Hedging Activities ("Statement
133"). Statement 133 establishes accounting and reporting standards for
derivative instruments, including certain derivative instruments embedded in
other contracts, and for hedging activities. Statement 133 requires that an
entity recognize all derivatives as either assets or liabilities in the
statement of financial position and measure the instrument at fair value. The
accounting changes in the fair value of a derivative depends on the intended use
of the derivative and the resulting designation. This Statement is effective for
all fiscal quarters beginning after June 15, 1999. The Company intends to adopt
this accounting standard as required, in the fourth quarter of fiscal 1999. The
adoption of this standard is not expected to have a material impact on the
Company's earnings or financial position.
15
<PAGE>
Item 3. Quantitative and Qualitative Disclosures about Market Risk
The Company is exposed to the impact of interest rate changes. In the normal
course of business, the Company employs established policies and procedures to
manage its exposure to changes in interest rates. The Company's objective in
managing its exposure to interest rate changes is to limit the impact of such
changes on earnings and cash flows and to lower its overall borrowing costs. To
achieve its objectives, the Company primarily uses interest rate swaps to manage
net exposure to interest rate changes related to its portfolio of borrowings.
Notional amounts of interest rate swap agreements are used to measure interest
to be paid or received relating to such agreements and do not represent an
amount of exposure to credit loss. The fair value of interest rate swap
agreements is the estimated amount the Company would receive or pay to terminate
the swap agreement at the reporting date, taking into account current interest
rates. The Libor rate as of December 31, 1998 was 5.4%. The estimated amount the
Company would pay to terminate its interest rate swap agreements outstanding at
December 31, 1998 is approximately $3,668,000. The fair value of the Company's
debt, based on quoted market prices or current rates for similar instruments
with same maturities was approximately $755,747,000 and $743,332,000 December
31, 1998 and September 30, 1998, respectively. The table below represents the
contractual or notional balances of the Company's fixed rate and market
sensitive instruments at expected maturity dates and the weighted average
interest rates.
<TABLE>
<CAPTION>
Liabilities
- --------------------------------------------------------------------------------------------------------------------------
Expected Maturity
1999 2000 2001 2002 2003 Thereafter Total
<S> <C> <C> <C> <C> <C> <C> <C>
- --------------------------------------------------------------------------------------------------------------------------
Long Term Debt:
Fixed Rate $673 $722 $20,278 $13,783 $250,771 $30,243 $316,470
Average Interest Rate 9.1% 9.1% 9.1% 9.0% 9.0% 9.4% 9.1%
Variable Rate $31,000 $35,000 $39,000 $42,000 $151,225 $152,500 $450,725
Average Interest Rate Libor +2.6% Libor +2.6% Libor +2.6% Libor +2.6% Libor +2.6% Libor +2.7% Libor + 2.6%
- --------------------------------------------------------------------------------------------------------------------------
Interest Rate Derivatives
- --------------------------------------------------------------------------------------------------------------------------
Expected Maturity
1999 2000 2001 2002 2003 Thereafter Total
- --------------------------------------------------------------------------------------------------------------------------
Interest Rate Swaps:
Variable to Fixed $100,000 $100,000
Average Fixed Pay Rate 5.6% 5.6%
Average Variable Rate Libor Libor
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
16
<PAGE>
PART II: OTHER INFORMATION
Item 1. Legal Proceedings. Not Applicable.
Item 2. Changes in Securities and Use of Proceeds. Not Applicable.
Item 3. Defaults Upon Senior Securities. Not Applicable.
Item 4. Submission of Matters to a Vote of Security Holders. Not Applicable.
Item 5. Other Information. Not Applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit No. Description
----------- -----------
10.1 Amendment No. 1 to Credit Agreement,
October 14, 1997 Multicare Inc. from
Mellon Bank, N.A., Citicorp. USA Inc.,
First Union Bank and NationBank, N.A.
10.2 Amendment No. 2 to Credit Agreement,
October 14, 1997 Multicare Inc. from
Mellon Bank, N.A., Citicorp. USA Inc.,
First Union Bank and NationBank, N.A.
10.3 Amendment No. 3 to Credit Agreement,
October 14, 1997 Multicare Inc. from
Mellon Bank, N.A., Citicorp. USA Inc.,
First Union Bank and NationBank, N.A.
27 Financial Data Schedule.
(b) Reports on Form 8-K. Not Applicable.
17
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this Report to be signed on its behalf by the
undersigned, thereunto duly authorized.
THE MULTICARE COMPANIES, INC.
Date: February 12, 1999 /S/ George V. Hager, Jr.
-------------------------------------------------
George V. Hager, Jr.
Senior Vice President and Chief Financial Officer
<PAGE>
Execution Copy
AMENDMENT NO. 1 AND WAIVER TO CREDIT AGREEMENT
AMENDMENT NO. 1 AND WAIVER TO CREDIT AGREEMENT, dated as of
March 5, 1998, (this "Amendment No. 1") by and among: The Multicare Companies,
Inc. and certain Subsidiaries identified on the signature pages hereto as
"Borrowers"; the institutions identified on the signature pages hereto as
"Lenders"; Mellon Bank, N.A. as Issuer of Letters of Credit and as
Administrative Agent; Citicorp USA, Inc. as Syndication Agent; First Union
National Bank as Documentation Agent; and NationsBank, N.A. as Syndication
Agent.
Background
A Credit Agreement, dated as of October 9, 1997, ("the
Original Credit Agreement") was entered into by and among The Multicare
Companies, Inc. and certain of its Subsidiaries as Borrowers, Mellon Bank, N.A.
as Issuer of Letters of Credit and Administrative Agent, Citicorp USA, Inc. as
Syndication Agent, First Union National Bank as Documentation Agent,
Nationsbank, N.A. as Syndication Agent, and the Lenders and other Agents
identified therein. Terms are used in this Amendment No. 1 as defined in the
Original Credit Agreement unless otherwise specified.
The Original Credit Agreement requires, among other things,
(1) that the Borrowers maintain a December 31 fiscal year, (2) that the
Borrowers deliver, among other financial statements, consolidated financial
statements of Genesis and its subsidiaries, which for those purposes, was
defined to include the Borrowers and (3) that certain dispositions be
consummated on or before December 31, 1997. The Borrowers have requested the
Agents and the Lenders to modify the terms of the Original Credit Agreement (a)
to permit the fiscal year of the Borrowers to be changed to September 30, (b) to
replace the requirement that the Borrowers deliver the aforesaid consolidated
financial statements (including the Borrowers) with a requirement that the
Borrowers deliver the financial statements of Genesis and its regularly
consolidated subsidiaries (which currently excludes the Borrowers) and (c) to
extend the date by which the Borrowers' institutional pharmacy business must be
sold. The Agents and the Lenders are willing to so modify the Original Credit
Agreement on the terms and subject to the conditions set forth below.
NOW THEREFORE, the parties hereto, intending to be legally
bound, hereby agree as follows.
<PAGE>
Agreement
1. Amendments to Original Credit Agreement. The Original Credit
Agreement, as of the Amendment No. 1 Effective Date (as defined below), is
amended in each of the following respects.
1.1 Excess Cash Flow. Section 1.5(b)(i) of the Original
Credit Agreement (Excess Cash Flow) is amended by replacing the date "December
31, 1998" in the second line thereof with the date "September 30, 1998".
1.2 Reference to Fiscal Year in Provision Respecting Fee
Calculation. Section 1.9(a) of the Original Credit Agreement (Commitment Fees)
is amended by replacing the phrase "for the fiscal year ending December 31,
1997" in the sixth line thereof with the phrase "for the fiscal quarter ending
December 31, 1997".
1.3 Delivery of Genesis Annual Financial Statements.
Clause (ii) of Section 6.1(a) of the Original Credit Agreement (Annual Financial
Statements) is amended in its entirety to read as follows:
(ii) statements of income, cash flows and changes in
stockholders' equity for Genesis and its
consolidated Subsidiaries, on a consolidated basis,
for such fiscal year and a balance sheet of Genesis
and its consolidated Subsidiaries, on a
consolidated basis, as of the close of such fiscal
year.
1.4 Delivery of Genesis Quarterly Financial Statements.
Clause (ii) of Section 6.1(b) of the Original Credit Agreement (Quarterly
Financial Statements) is amended in its entirety to read as follows:
(ii) statements of income, cash flows and changes in
stockholders' equity for Genesis and its
consolidated Subsidiaries, on a consolidated basis,
for such fiscal quarter, together with the
applicable year- to-date statements and a balance
sheet of such Persons, on a consolidated basis, as
of the end of such fiscal quarter.
1.5 Fiscal Year of Borrowers. The last sentence of Section
6.4 of the Original Credit Agreement (Maintenance of Records; Fiscal Year) is
amended in its entirety to read as follows: "Each Borrower shall maintain, and
shall cause the Surety to maintain, a fiscal year end of September 30."
1.6 Date for Sale of Pharmacy. Section 6.18 of the Original
Credit Agreement (Certain Dispositions) shall be amended in its entirety to read
as follows:
-2-
<PAGE>
The Borrowers shall sell to Genesis and/or one or more of its
Subsidiaries (other than Surety or Multicare or any Subsidiary of
either of them) their contract therapy business for a cash purchase
price of approximately $24,000,000.00 and their institutional
pharmacy business for a cash purchase price of approximately
$50,000,000.00, each on terms and conditions satisfactory to the
Agents. The contract therapy sale shall be consummated on or before
December 31, 1997 and the institutional pharmacy sale shall be
consummated on or before June 30, 1998.
1.7 Reference to Fiscal Year in Lease Expenditure Provision.
Paragraph (c) of Section 8.7 of the Original Credit Agreement (Leases) is
amended by replacing the date "December 31, 1997" in the fourth line thereof
with the date "September 30, 1997" and by replacing the date "December 31, 1998"
in the sixth line thereof with the date "September 30, 1998".
1.8 Reference to Fiscal Year in Capital Expenditure
Covenant. Section 8.15 of the Original Credit Agreement (Capital Expenditures)
is amended by replacing the date "December 31, 1997" in the fourth line thereof
with the date "September 30, 1997".
1.9 Reference to Fiscal Year in Definition of "Applicable
Margin". The definition of "Applicable Margin" in Section 11.1 of the Original
Credit Agreement (Certain Definitions) is amended by replacing the phrase "for
the fiscal year ended December 31, 1997" in the fourth line thereof with the
phrase "for the fiscal quarter ended December 31, 1997".
1.10 Definition of "Genesis Group". The definition of "Genesis
Group" in Section 11.1 of the Original Credit Agreement (Certain Definitions) is
amended in its entirety to read as follows:
"Genesis Group" means Genesis and its consolidated
Subsidiaries, provided, however, whether or not the Multicare
Group shall ever be consolidated with Genesis for GAAP
purposes, the "Genesis Group" shall not include the Multicare
Group.
2. Representations and Warranties. In order to induce the
Lenders, the Issuer and the Agents to agree to amend the Original Credit
Agreement, each of the Borrowers, jointly and severally, makes the following
representations and warranties, which shall survive the execution and delivery
of this Amendment No. 1:
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(a) The change in the fiscal year of the Borrowers and
Surety was made as of September 30, 1997 such that the
fiscal year ending September 30, 1998 will include four
full fiscal quarters;
(b) No Default or Event of Default has occurred and is
continuing or would exist immediately after giving effect
to the amendments contained herein; and
(c) Each of the representations and warranties set forth in
the Credit Agreement is true and correct in all material
respects both before and after giving effect to the
amendments and transactions contemplated hereby as though
each such representation and warranty were made at and as
of the date hereof and as of the Amendment No. 1 Effective
Date.
3. Amendment No. 1 Effective Date. The amendments set forth in
Section 1 above and the waivers set forth in Section 4 below shall be effective
on the date (the "Amendment No. 1 Effective Date") that each of the following
conditions is satisfied:
3.1 Execution of Amendment. Each of the Borrowers and the
Required Lenders shall have executed this Amendment No. 1 and the Surety shall
have executed the acknowledgement set forth below.
3.2 Other Documents and Information. The Administrative
Agent shall have received such other documents and information as it shall
reasonably request.
4. Waiver. The Lenders waive any default that might have
occurred under those provisions of the Original Credit Agreement amended
pursuant to Section 1 above as a direct result of the failure to sell the
institutional pharmacy business prior to December 31, 1997 or as a direct result
of the change in the fiscal year prior to the Amendment No. 1 Effective Date. In
addition, the Lenders waive any default that might have occurred under the
Original Credit Agreement amended pursuant to Section 1 above as a direct result
of the failure of Multicare to deliver the consolidated financial statements of
Genesis and its consolidated Subsidiaries and Multicare and its consolidated
Subsidiaries (whether or not all such entities are consolidated under GAAP) as
at, and for the period ended, December 31, 1997, so long as the requirements to
deliver the financial statements specified in this Amendment No. 1 are
satisfied. The aforesaid waivers are limited to their express terms and do not
imply (a) any further waiver if the sale is not consummated by June 30, 1998 in
accordance with the terms of the Credit Agreement or (b) any other or future
waivers.
5. Counterparts. This Amendment No. 1 may be executed in
counterparts and by different parties hereto in separate counterparts, each of
which, when executed and
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delivered, shall be deemed to be an original and all of which, when taken
together, shall constitute one and the same instrument. A photocopied or
facsimile signature shall be deemed to be the functional equivalent of a
manually executed original for all purposes.
6. Ratification. The Original Credit Agreement, as amended by
this Amendment No. 1, and the other Loan Documents are, and shall continue to
be, in full force and effect and are hereby in all respects confirmed, approved
and ratified. Without limiting the generality of the foregoing, the undersigned
Borrowers and Surety, in their capacity as pledgors under the Pledge Agreement,
confirm that the security interest granted pursuant to the Pledge Agreement
continues to secure all of the Obligations (as defined in the Pledge Agreement)
and the undersigned Surety confirms that the Suretyship Agreement continues to
guaranty, and provide a suretyship for, all of the Guaranteed Obligations (as
defined in the Suretyship Agreement).
7. Payment of Expenses. Without limiting other payment
obligations of the Borrowers set forth in the Loan Documents, the Borrowers
hereby, jointly and severally, agree to pay all costs and expenses incurred by
the Administrative Agent in connection with the preparation, execution and
delivery of this Amendment No. 1 and any other documents or instruments which
may be delivered in connection herewith, including, without limitation, the
reasonable fees and expenses of its counsel, Drinker Biddle & Reath LLP.
8. Authorization to Agents. Each Lender hereby authorizes the
Administrative Agent to take such action (including, without limitation, signing
amendments to Loan Documents) as shall be consistent with the purposes hereof
and as it shall deem necessary or appropriate to carry out the purposes of this
Amendment No. 1.
9. Governing Law. This Amendment No. 1 shall be construed in
accordance with, and governed by, the laws of the Commonwealth of Pennsylvania,
without regard to choice of law principles.
10. References. From and after the Amendment No. 1 Effective
Date, each reference in the Credit Agreement to "this Agreement", "hereof",
"hereunder" or words of like import, and all references to the Credit Agreement
in any and all Loan Documents, other agreements, instruments, documents,
certificates and writings of every kind and nature, shall be deemed to mean the
Original Credit Agreement as modified and amended by this Amendment No. 1 and as
the same may be further amended, modified or supplemented in accordance with the
terms thereof.
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IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to
be duly executed as of the date first above written.
BORROWERS:
THE MULTICARE COMPANIES, INC., a
Delaware corporation
By____________________________________
Name: James V. McKeon
Title: Vice President, Controller
and Assistant Secretary
Address for notices:
148 West State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
ADS APPLE VALLEY LIMITED
PARTNERSHIP, a Massachusetts limited
partnership, by: ADS Apple Valley, Inc.
its General Partner
ADS RECUPERATIVE CENTER
ADS DARTMOUTH GENERAL LIMITED PARTNERSHIP, a
PARTNERSHIP, a Massachusetts general Massachusetts limited partnership, by
partnership, by ADS Dartmouth ALF, Inc. ADS Recuperative Center, Inc., its
and ADS Senior Housing, Inc., its General Partner
General Partners
ADS HINGHAM LIMITED CARE 4, L.P., a Delaware limited
PARTNERSHIP, a Massachusetts limited partnership, by Institutional Health
partnership, by ADS Hingham Nursing Care Services, Inc., its General
Facility, Inc., its General Partner Partner
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CARE HAVEN ASSOCIATES LIMITED
PARTNERSHIP, a West Virginia limited
partnership, by Glenmark Associates, Inc.
and GMA Partnership Holding Company,
Inc., its General Partners
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Initials of Signor
CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Cumberland, Inc., its General Partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
GROTON ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Groton, Inc., its General Partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited
partnership, by Health Resources of Middletown (R.I.), Inc., its General Partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc., its General Partner
RALEIGH MANOR LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
Address for notices: 148 West State Street Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq. Telephone: (610) 444-6350 Facsimile: (610)
444-3365
ROMNEY HEALTH CARE CENTER LIMITED PARTNERSHIP, a West Virginia limited
partnership, by Glenmark Associates, Inc., its General Partner
SISTERVILLE HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
THE STRAUS GROUP - HOPKINS HOUSE, L.P., a New Jersey limited partnership, by
Encare of Wyncote, Inc., its General Partner
THE STRAUS GROUP - QUAKERTOWN MANOR, L.P., a New Jersey limited partnership, by
Encare of Quakertown, Inc., its General Partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Wallingford, Inc., its General Partner
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WARWICK ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Warwick, Inc., its General Partner
By:__________________________ On behalf of each of the foregoing as Vice
President, Controller and Assistant Secretary of the General Partner
HOLLY MANOR ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Encare of Mendham, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Breyut Convalescent Center, L.L.C., its General Partner, by Century Care
Management, Inc., its authorized manager
POMPTON ASSOCIATES, L.P., a New Jersey limited partnership, by Pompton Corp.,
L.L.C., its General Partner, by Century Care Management, Inc., its authorized
manager
THE STRAUS GROUP - OLD BRIDGE, L.P., a New Jersey limited partnership, by Health
Resources of Emery, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
THE STRAUS GROUP - RIDGEWOOD, L.P., a New Jersey limited partnership, by Health
Resources of Ridgewood, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
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By:__________________________ On behalf of each of the foregoing as Vice
President, Controller and Assistant Secretary of the manager
Address for notices: 149 West State Street Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
ACADEMY NURSING HOME, INC., a Massachusetts corporation
ADS APPLE VALLEY, INC., a Massachusetts corporation
ADS CONSULTING, INC., a Massachusetts corporation
ADS DANVERS ALF, INC., a Delaware corporation
ADS DARTMOUTH ALF, INC., a Delaware corporation
ADS HINGHAM ALF, INC., a Delaware Corporation
ADS HINGHAM NURSING FACILITY, INC., a Massachusetts corporation
ADS HOME HEALTH, INC., a Delaware corporation
ADS MANAGEMENT, INC., a Massachusetts corporation
ADS/MULTICARE, INC., a Delaware corporation
ADS RECUPERATIVE CENTER, INC., a Massachusetts corporation
ADS SENIOR HOUSING, INC., a Massachusetts corporation
ADS VILLAGE MANOR, INC., a Massachusetts corporation
ANR, INC., a Delaware corporation
APPLEWOOD HEALTH RESOURCES, INC., a Delaware corporation
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Initials of Signor
AUTOMATED PROFESSIONAL ACCOUNTS, INC., a West Virginia corporation
BERKS NURSING HOMES, INC., a Pennsylvania corporation
BETHEL HEALTH RESOURCES, INC., a Delaware corporation
BRIGHTWOOD PROPERTY, INC., a West Virginia corporation
CENTURY CARE CONSTRUCTION, INC., a New Jersey corporation
CENTURY CARE MANAGEMENT, INC., a Delaware corporation
CHATEAU VILLAGE HEALTH RESOURCES, INC., a Delaware corporation
CHG INVESTMENT CORP., INC., a Delaware corporation
CHNR-1, INC., a Delaware corporation
COLONIAL HALL HEALTH RESOURCES, INC., a Delaware corporation
COLONIAL HOUSE HEALTH RESOURCES, INC., a Delaware corporation
COMPASS HEALTH SERVICES, INC., a West Virginia corporation
CONCORD HEALTH GROUP, INC., a Delaware corporation
CONCORD HOME HEALTH, INC., a Pennsylvania corporation
CONCORD PHARMACY SERVICES, INC., a Pennsylvania corporation
CONCORD REHAB, INC., a Pennsylvania corporation
CONCORD SERVICE CORPORATION, a Pennsylvania corporation
CVNR, INC., a Delaware corporation
DELM NURSING, INC., a Pennsylvania corporation
ELMWOOD HEALTH RESOURCES, INC., a Delaware corporation
ENCARE OF MASSACHUSETTS, INC., a Delaware corporation
ENCARE OF PENNYPACK, INC., a Pennsylvania corporation
ENCARE OF QUAKERTOWN, INC., a Pennsylvania corporation
ENCARE OF WYNCOTE, INC., a Pennsylvania corporation
ENR, INC., a Delaware corporation
GLENMARK ASSOCIATES, INC., a West Virginia corporation
GMA - BRIGHTWOOD, INC., a West Virginia corporation
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Initials of Signor
GMA CONSTRUCTION, INC., a West Virginia corporation
GMA - MADISON, INC., a West Virginia corporation
GMA PARTNERSHIP HOLDING COMPANY, INC., a West Virginia corporation
GMA - UNIONTOWN, INC., a Pennsylvania corporation
HEALTH RESOURCES OF BROADMAN, INC., a Delaware corporation
HEALTH RESOURCES OF CEDAR GROVE, INC., a New Jersey corporation
HEALTH RESOURCES OF COLCHESTER, INC., a Connecticut corporation
HEALTH RESOURCES OF COLUMBUS, INC., a Delaware corporation
HEALTH RESOURCES OF CUMBERLAND, INC., a Delaware corporation
HEALTH RESOURCES OF EATONTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF FARMINGTON, INC., a Delaware corporation
HEALTH RESOURCES OF GARDNER, INC., a Delaware corporation
HEALTH RESOURCES OF GLASTONBURY, INC., a Connecticut corporation
HEALTH RESOURCES OF GROTON, INC., a Delaware corporation
HEALTH RESOURCES OF LAKEVIEW, INC., a New Jersey corporation
HEALTH RESOURCES OF LEMONT, INC., a Delaware corporation
HEALTH RESOURCES OF LYNN, INC., a New Jersey corporation
HEALTH RESOURCES OF KARMENTA AND MADISON, INC., a Delaware corporation
HEALTH RESOURCES OF MARCELLA, INC., a Delaware corporation
HEALTH RESOURCES OF MIDDLETOWN (R.I.), INC., a Delaware corporation
HEALTH RESOURCES OF MORRISTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF NORFOLK, INC., a Delaware corporation
HEALTH RESOURCES OF NORWALK, INC., a Connecticut corporation
HEALTH RESOURCES OF PENNINGTON, INC., a New Jersey corporation
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Initials of Signor
HEALTH RESOURCES OF ROCKVILLE, INC., a Delaware corporation
HEALTH RESOURCES OF SOUTH BRUNSWICK, INC., a New Jersey corporation
HEALTH RESOURCES OF TROY HILLS, INC., a New Jersey corporation
HEALTH RESOURCES OF WALLINGFORD, INC., a Delaware corporation
HEALTH RESOURCES OF WARWICK, INC., a Delaware corporation
HEALTHCARE REHAB SYSTEMS, INC., a Pennsylvania corporation
HORIZON ASSOCIATES, INC., a West Virginia corporation
HORIZON MEDICAL EQUIPMENT AND SUPPLY, INC., a West Virginia corporation
HORIZON MOBILE, INC., a West Virginia corporation
HORIZON REHABILITATION, INC., a West Virginia corporation
HR OF CHARLESTON, INC., a West Virginia corporation
HRWV Huntington, Inc., a West Virginia corporation
INSTITUTIONAL HEALTH CARE SERVICES, INC., a New Jersey corporation
LAKEWOOD HEALTH RESOURCES, INC., a Delaware corporation
LAUREL HEALTH RESOURCES, INC., a Delaware corporation
LEHIGH NURSING HOMES, INC., a Pennsylvania corporation
LWNR, INC., a Delaware corporation
MABRI CONVALESCENT CENTER, INC., a Connecticut corporation
MARKGLEN, INC., a West Virginia corporation
MARSHFIELD HEALTH RESOURCES, INC., a Delaware corporation
MONTGOMERY NURSING HOMES, INC., a Pennsylvania corporation
MULTICARE AMC, INC., a Delaware Corporation
MULTICARE HOME HEALTH OF ILLINOIS, INC., a Delaware corporation
NATIONAL PHARMACY SERVICE, inc., a Pennsylvania corporation
NURSING AND RETIREMENT CENTER OF THE ANDOVERS, INC., a Massachusetts corporation
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Initials of Signor
PHC OPERATING CORP., a Delaware corporation
POCAHONTAS CONTINUOUS CARE CENTER, INC., a West Virginia corporation
PRESCOTT NURSING HOME, INC., a Massachusetts corporation
PROGRESSIVE REHABILITATION CENTERS, INC., a Delaware corporation
PROVIDENCE HEALTH CARE, INC., a Delaware corporation
REST HAVEN NURSING HOME, INC, a West Virginia corporation
RIDGELAND HEALTH RESOURCES, INC., a Delaware corporation
RIVER PINES HEALTH RESOURCES, INC., a Delaware corporation
RIVERSHORES HEALTH RESOURCES, INC., a Delaware corporation
RLNR, INC., a Delaware corporation
ROSE HEALTHCARE, INC., a New Jersey corporation
ROSE VIEW MANOR, INC., a Pennsylvania corporation
RSNR, INC., a Delaware corporation
RVNR, INC., a Delaware corporation
SENIOR LIVING VENTURES, INC., a Pennsylvania corporation
SCHUYLKILL NURSING HOMES, INC., a Pennsylvania corporation
SCHUYLKILL PARTNERSHIP ACQUISITION CORP., a Pennsylvania corporation
SENIOR SOURCE, INC., a Massachusetts corporation
SNOW VALLEY HEALTH RESOURCES, INC., a Delaware corporation
SOLOMONT FAMILY FALL RIVER VENTURE, INC., a Massachusetts corporation
SOLOMONT FAMILY MEDFORD VENTURE, INC., a Massachusetts corporation
STAFFORD CONVALESCENT CENTER, INC., a Delaware corporation
S.T.B. INVESTORS, LTD., a New York corporation
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<PAGE>
Address for notices:
148 West State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
SVNR, INC., a Delaware corporation
THE ADS GROUP, INC., a Massachusetts corporation
TRI-STATE MOBILE MEDICAL SERVICES, INC., a West Virginia corporation
WESTFORD NURSING AND RETIREMENT CENTER, INC., a Massachusetts corporation
WILLOW MANOR NURSING HOME, INC., a Massachusetts corporation
By:___________________________________
On behalf of each of the foregoing as
Vice President, Controller and
Assistant Secretary
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BREYUT CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
ENCARE OF MENDHAM, L.L.C., a New Jersey limited liability company, by Century
Care Management, Inc., its authorized manager
HEALTH RESOURCES OF BRIDGETON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CINNAMINSON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CRANBURY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EMERY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF ENGLEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EWING, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF FAIR LAWN, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF JACKSON, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF RIDGEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF WEST ORANGE, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
POMPTON CARE, L.L.C., a New Jersey limited liability company, by Century Care
Management, Inc., its authorized manager
ROEPHEL CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
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Initials of Signor
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<PAGE>
TOTAL REHABILITATION CENTER, L.L.C.,
a New Jersey limited liability corporation, by
Century Care Management, Inc., its authorized manager
By:_______________________
On behalf of each of the foregoing
Vice President, Controller
and Assistant Secretary of the manager
Address for notices:
148 West State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
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AGENTS, ISSUER AND LENDERS:
MELLON BANK, N.A., as a Lender,
as Issuer and as Administrative Agent
By________________________________
Name:
Title:
Address for notices:
street address:
AIM 199-5220
Mellon Independence Center
701 Market Street
Philadelphia, Pennsylvania 19106
mailing address:
AIM 199-5220
P.O. Box 7899
Philadelphia, Pennsylvania 19101-7899
Attention: Linda Sigler,
Loan Administration
Telephone: 215-553-4583
Facsimile: 215-553-4789
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<PAGE>
With a copy to
Plymouth Meeting Executive Campus
610 W. Germantown Pike, Suite 200
Plymouth Meeting, Pennsylvania 19462
Attention: Barbara J. Hauswald
Vice President
Telephone: 610-941-8412
Facsimile: 610-941-4136
With a copy for notices
respecting assignments to:
MELLON BANK, N.A.
One Mellon Bank Center
45th Floor
Pittsburgh, PA 15258-0001
Attention: Dean Hazelton
Telephone: 412-236-0316
Facsimile: 412-234-4612
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CITICORP USA INC., as a Lender and
as Syndication Agent
By________________________________
Name:
Title:
Address for notices:
399 Park Avenue
8th Floor, Zone 6
New York, NY 10043
Attention: Margaret A. Brown
Telephone: 212-559-0501
Facsimile: 212-793-0289
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FIRST UNION NATIONAL BANK, as a
Lender and as Documentation Agent
By________________________________
Name:
Title:
Address for notices:
One First Union Center TW-5
Charlotte, NC 28288-0735
Attention: Matt MacIver
Telephone: 704-374-4187
Facsimile: 704-383-9144
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<PAGE>
NATIONSBANK, N.A., as a Lender and
as a Syndication Agent
By_______________________________
Name:
Title:
Address for notices:
101 North Tryon Street
15th Floor
Charlotte, NC 28255
NC1-001-15-11
Attention: Jacquetta Banks
Telephone: 704-388-1111
Facsimile: 704-386-8694
With a copy to
100 North Tryon Street
8th Floor
Charlotte, NC 28255
NC1-007-0813
Attention: Scott Ward
Telephone: 704-388-7839
Facsimile: 704-388-6002
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CORESTATES BANK, N.A.
By:_______________________________
Name:
Title:
Address for notices:
CoreStates Bank, N.A.
1339 Chestnut Street
F.C. 1-8-3-22
P.O. Box 7618
Philadelphia, PA 19101-7618
Attention: Jennifer Leibowitz
Telephone: (215) 786-3972
Facsimile: (215) 973-2738
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CREDIT LYONNAIS NEW YORK BRANCH
By:______________________________
Name:
Title:
Address for notices:
Credit Lyonnais New York Branch
1301 Avenue of the Americas
New York, NY 10019
Attention: Evan S. Wasser
Telephone: (212) 261-7685
Facsimile: (212) 261-3440
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<PAGE>
FLEET NATIONAL BANK
By:______________________________
Name:
Title:
Address for notices:
Fleet National Bank
One Federal Street
MA OF 007B
Boston, MA 02110
Attention: Carol Paige
Telephone: (617) 346-4619
Facsimile: (617) 346-4699
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<PAGE>
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By:_________________________________
Name:
Title:
Address for notices:
The Industrial Bank of Japan, Limited
1251 Avenue of the Americas
New York, NY 10020
Attention: Ken Takehisa
Telephone: (212) 282-3321
Facsimile: (212) 282-4490
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<PAGE>
NATIONAL WESTMINSTER BANK Plc
By:______________________________
Name:
Title:
Address for notices:
National Westminster Bank Plc
175 Water Street, 26th Floor
New York, NY 10038
Attention: Andrew Weinberg
Phone: (212) 602-4438
Facsimile: (212) 602-4506
with a copy to:
Gleacher NatWest Inc.
660 Madison Avenue, 17th Floor
New York, NY 10021
Attention: Field Smith
Telephone: (212) 418-4525
Facsimile: (212) 418-4598
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<PAGE>
THE SAKURA BANK, LIMITED
By:______________________________
Name:
Title:
Address for notices:
The Sakura Bank, Limited
277 Park Avenue, 45th Floor
New York, NY 10172
Attention: Philip Schubert
Telephone: (212) 756-6945
Facsimile: (212) 888-7651
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<PAGE>
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By:______________________________
Name:
Title:
Address for notices:
Bank of America National Trust
& Savings Associations
555 S. Flower Street, 11th Floor
Los Angeles, CA 90071
Attention: Lucy Nixon
Telephone: (213) 228-9716
Facsimile: (213) 228-2756
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<PAGE>
BANQUE PARIBAS
By:______________________________
Name:
Title:
Address for notices:
Banque Paribas
787 Seventh Avenue
New York, NY 10019
Attention: David R. Laffey
Telephone: (212) 841-2216
Facsimile: (212) 841-2292
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<PAGE>
BANKBOSTON, N.A.
By:______________________________
Name:
Title:
Address for notices:
BankBoston, N.A.
100 Federal Street, 01-08-06
Boston, MA 02110
Attention: Frank Fama
Telephone: (617) 434-4144
Facsimile: (617) 434-0819
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<PAGE>
THE BANK OF NEW YORK
By:______________________________
Name:
Title:
Address for notices:
The Bank of New York
One Wall Street, 21st Floor
New York, NY 10286
Attention: Walter C. Parelli
Telephone: (212) 635-6820
Facsimile: (212) 635-7970
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<PAGE>
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By:____________________________________
Name:
Title:
Address for notices:
Bank of Tokyo-Mitsubishi Trust Company
1251 Avenue of the Americas, 12th Floor
New York, NY 10020-1104
Attention: Ned Komar
Telephone: (212) 782-4584
Facsimile: (212) 782-4935
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<PAGE>
CRESTAR BANK
By:______________________________
Name:
Title:
Address for notices:
Crestar Bank
120 E. Baltimore Street, 25th Floor
Baltimore, MD 21202
Attention: Leesa McShane
Telephone: (410) 986-1672
Facsimile: (410) 986-1670
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<PAGE>
DRESDNER BANK AG, NEW YORK
BRANCH AND GRAND CAYMAN BRANCH
By:______________________________
Name:
Title:
Address for notices:
By:______________________________
Name:
Title:
Address for notices:
Dresdner Bank AG, New York
75 Wall Street, 25th Floor
New York, NY 10005-2889
Attention: Felix K. Camacho
Telephone: (212) 429-3007
Facsimile: (212) 429-2129
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FINOVA CAPITAL CORPORATION
By:______________________________
Name:
Title:
Address for notices:
Finova Capital Corporation
311 S. Wacker, Suite 4400
Chicago, IL 60606
Attention: Brian Williamson
Telephone: (312) 294-4175
Facsimile: (312) 322-3553
-35-
<PAGE>
KEY CORPORATE CAPITAL INC.
By:______________________________
Name: Angela Mago
Title: Vice President
Address for notices:
Key Corporate Capital Inc.
c/o Key Bank, N.A.
127 Public Square
Cleveland, OH 44114
Attention: Angela Mago
OH-01-27-0605
Telephone: (216) 689-3247
Facsimile: (216) 689-5970
-36-
<PAGE>
FIRST NATIONAL BANK OF MARYLAND
By:______________________________
Name:
Title:
Address for notices:
First National Bank of Maryland
25 S. Charles Street, 18th Floor
Baltimore, MD 21201
Attention: Robert H. Hauver
Telephone: (410) 244-4246
Facsimile: (410) 244-4388
-37-
<PAGE>
NATEXIS BANQUE BFCE
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
Address for notices:
Natexis Banque BFCE
645 Fifth Avenue, 20th Floor
New York, NY 10022
Attention: Frank Madden
Telephone: (212) 872-5180
Facsimile: (212) 872-5045
-38-
<PAGE>
NATIONAL CITY BANK OF PENNSYLVANIA
By:______________________________
Name:
Title:
Address for notices:
National City Bank of Pennsylvania
20 Stanwix Street, 46-25-191
Pittsburgh, PA 15222
Loc. 46-25-191
Attention: Debra W. Riefner
Telephone: (412) 644-8880
Facsimile: (412) 471-4883
-39-
<PAGE>
THE SANWA BANK, LIMITED
By:______________________________
Name:
Title:
Address for notices:
The Sanwa Bank, Limited
55 E. 52nd Street
New York, NY 10055
Attention: Christian Kambour
Telephone: (212) 339-6232
Facsimile: (212) 754-1304
-40-
<PAGE>
THE SUMITOMO BANK, LIMITED
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
Address for notices:
The Sumitomo Bank, Limited
One Liberty Place
1650 Market Street, Suite 2860
Philadelphia, PA 19103
Attention: J. Wade Bell
Telephone: (215) 636-4440
Facsimile: (215) 636-4446
-41-
<PAGE>
SUMMIT BANK
By:__________________________________________
Name: James P. Andersen
Title: Vice President and Regional Manager
Address for notices:
Summit Bank
250 Moore Street, 2nd Floor
Hackensack, NJ 07601
Attention: Christine Clausen
Telephone: (201) 646-5080
Facsimile: (201) 646-9497
-42-
<PAGE>
THE DAI-ICHI KANGYO BANK, LTD.
By:______________________________
Name:
Title:
Address for notices:
The Dai-Ichi Kangyo Bank, Ltd.
One World Trade Center, 48th Floor
New York, NY 10048
Attention: Takayuki Kumagai
Telephone: (212) 432-6651
Facsimile: (212) 488-8955
-43-
<PAGE>
CREDITANSTALT CORPORATE FINANCE, INC.
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
Address for notices:
Creditanstalt Corporate Finance, Inc.
Two Greenwich Plaza
Greenwich, CT 06830
Attention: Fiona McKone
Telephone: (203) 861-6590
Facsimile: (203) 861-0297
-44-
<PAGE>
CREDIT SUISSE FIRST BOSTON
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
Address for notices:
Credit Suisse First Boston
11 Madison Avenue
New York, NY 10010
Attention: Robert B. Potter
Telephone: (212) 325-9154
Facsimile: (212) 325-8319
-45-
<PAGE>
FIRST NATIONAL BANK OF CHICAGO
By:______________________________
Name:
Title:
Address for notices:
First National Bank of Chicago
1 First National Plaza
Chicago, IL 60670
Attention: Tom Harkless
Telephone: (312) 732-2478
Facsimile: (312) 732-2016
-46-
<PAGE>
SCOTIABANC, INC.
By:______________________________
Name:
Title:
Address for notices:
ScotiaBanc, Inc.
600 Peachtree Street NE
Suite 2700
Atlanta, GA 30308
Attention: Dana Maloney
Telephone: (404) 877-1524
Facsimile: (404) 888-8998
-47-
<PAGE>
CIBC INC.
By:______________________________
Name:
Title:
Address for notices:
CIBC Inc.
425 Lexington Avenue, 8th Floor
New York, NY 10025
Attention: Judith Kirshner
Telephone: (212) 856-4157
Facsimile: (212) 856-2991
-48-
<PAGE>
AMSOUTH BANK
By:______________________________
Name:
Title:
Address for notices:
AmSouth Bank
1900 5th Ave. N. AST7FL
Birmingham, AL 35203
Attention: Ken DiFatta
Telephone: (205) 801-0358
Facsimile: (205) 326-4790
-49-
<PAGE>
PFL LIFE INSURANCE COMPANY
By:__________________________________________
Name:
Title:
Address for notices:
PFL Life Insurance Company
c/o Aegon USA Investment Management, Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Attention: John Bailey, Securities Analyst
Telephone: (319) 369-2811
Facsimile: (319) 369-2666
-50-
<PAGE>
PEOPLES INTERNAL BOND FUND
By:______________________________
Name:
Title:
Address for notices:
Peoples Internal Bond Fund
c/o Aegon USA Investment Management, Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Attention: John Bailey, Securities Analyst
Telephone: (319) 369-2811
Facsimile: (319) 369-2666
Payment Advice
--------------
Attention: Securities Processing
Peoples Internal Bond Fund
c/o AEGON USA Investment Management, Inc.
400 W. Market Street
Louisville, KY 40202
Fax Number: (502) 560-2068
-51-
<PAGE>
FLOATING RATE PORTFOLIO
By: Chancellor LGT Senior Secured
Management, Inc., as attorney in fact
By:______________________________
Christopher A. Bondy, Vice President
Address for notices:
Floating Rate Portfolio
c/o Chancellor LGT Senior Secured
Management, Inc.
1166 Avenue of the Americas, 27th Floor
New York, NY 10036
Attention: Christopher A. Bondy
Telephone: (212) 278-9673
Facsimile: (212) 278-9619
-52-
<PAGE>
PRIME INCOME TRUST
By:______________________________
Name:
Title:
Address for notices:
Prime Income Trust
c/o Dean Witter Intercapital, Inc.
72nd Floor
Two World Trade Center
New York, NY 10048
Attention: Louis A. Pistecchia
Telephone: (212) 392-5845
Facsimile: (212) 392-5345
-53-
<PAGE>
DEEPROCK & COMPANY
By: Eaton Vance Management
as Investment Advisor
By:______________________________
Name:
Title:
Address for notices:
State Street Bank & Trust Company
Corporate Trust Division
One Enterprise Drive
North Quincy, MA 02171
Attention: Patrick McEnroe
Telephone: (617) 664-5367
Facsimile: (617) 664-5366
Eaton Vance Management
Attention: Prime Rate Reserves
24 Federal Street, 6th Floor
Boston, MA 02110
Attention: Payson Swaffield
Telephone: (617) 654-8486
Telecopier: (617) 695-9594
Reference:
-54-
<PAGE>
ING HIGH INCOME PRINCIPAL
PRESERVATION OFFERING, L.P.
By:______________________________
Name:
Title:
Address for notices:
Ing High Income Principal Preservation
Offering, L.P.
c/o Ing Capital Advisors, Inc.
333 S. Grand Avenue, Suite 4250
Los Angeles, CA 90071
Attention: Kathleen Lenarcic
Telephone: (213) 346-3971
Facsimile: (213) 346-3995
-55-
<PAGE>
MASSACHUSETTS MUTUAL LIFE INSURANCE CO.
By:____________________________________
Name:
Title:
Address for notices:
Massachusetts Mutual Life Insurance Co.
1295 State Street
Springfield, MA 01111
Attention: John Wheeler, Managing Director
Telephone: (413) 744-6228
Facsimile: (413) 744-6127
-56-
<PAGE>
MERRILL LYNCH SENIOR FLOATING
RATE FUND, INC.
By: Merrill Lynch Asset Management,
L.P., as Investment Advisor
By:______________________________
Name:
Title:
Address for notices:
Merrill Lynch Senior Floating Rate Fund, Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road - Area 1B
Plainsboro, NJ 08536
Attention: Douglas Henderson
Telephone: (609) 282-2059
Facsimile: (609) 282-2550
-57
<PAGE>
METROPOLITAN LIFE INSURANCE COMPANY
By:______________________________
Name:
Title:
Address for notices:
Metropolitan Life Insurance Company
334 Madison Avenue
Convent Station, NJ 07961-0633
Attention: James Dingler
Asst. Vice President
Telephone: (201) 254-3206
Facsimile: (201) 254-3050
-58-
<PAGE>
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By:______________________________
Name:
Title:
Address for notices:
The Northwestern Mutual Life Insurance
Company
720 E. Wisconsin Avenue
Milwaukee, WI 53202
Attention: David A. Barras
Associate Director
Telephone: (414) 299-1618
Facsimile: (414) 299-7124
-59-
<PAGE>
NEW YORK LIFE INSURANCE
AND ANNUITY CORPORATION
By: New York Life Insurance Company
By:______________________________
Name:
Title:
Address for notices:
New York Life Insurance and Annuity
Corporation
c/o New York Life Insurance Company
51 Madison Avenue, Room 206
New York, NY 10010
Attention: Elise Chowdhry
Telephone: (212) 576-7830
Facsimile: (212) 447-4122
-60-
<PAGE>
OAK HILL SECURITIES FUND, L.P.
By: Oak Hill Securities GenPar, L.P.,
Its General Partner
By: Oak Hill Securities MGP, Inc.,
Its General Partner
By:______________________________
Name:
Title:
Address for notices:
Oak Hill Securities Fund, L.P.
c/o Oak Hill Partners, Inc.
65 East 55th Street - 32nd Floor
New York, NY 10022
Attention: Scott Krase, Vice President
Telephone: (212) 326-1551
Facsimile: (212) 593-3596
-61-
<PAGE>
OCTAGON CREDIT INVESTORS LOAN
PORTFOLIO (A Unit of The Chase Manhattan Bank)
By:__________________________________________
Name:
Title:
Address for notices:
Octagon Credit Investors Loan Portfolio
(A Unit of The Chase Manhattan Bank)
c/o Octagon Credit Investors
380 Madison Avenue, 12th Floor
New York, NY 10017
Attention: James P. Ferguson
Managing Director
Telephone: (212) 622-3070
Facsimile: (212) 622-3797
-62-
<PAGE>
PARIBAS CAPITAL FUNDING LLC
By:______________________________
Name:
Title:
Address for notices:
Paribas Capital Funding LLC
787 Seventh Avenue, 32nd Floor
New York, NY 10019
Attention: Michael Weinberg
Telephone: (212) 841-2544
Facsimile: (212) 841-2144
with a copy to:
State Street Bank & Trust Co.
Corporate Trust Dept.
Attn: Richard Wagman
Amy Molisse
Phone: (617) 664-5410
Fax: (617) 664-5366(67)(68)
-63-
<PAGE>
PILGRIM AMERICA PRIME RATE TRUST
By:______________________________
Name:
Title:
Address for notices:
Pilgrim America Prime Rate Trust
c/o Pilgrim America Investments, Inc.
Two Renaissance Square
40 North Central Avenue, Suite 1200
Phoenix, AZ 85004-3444
Attention: Michael Bacevich, Vice President
Telephone: (602) 417-8258
Facsimile: (602) 417-8327
-64-
<PAGE>
ROYALTON COMPANY
By: Pacific Investment Management
Company, as its Investment Advisor
By:______________________________
Name:
Title:
Address for notices:
Royalton Company
c/o Pacific Investment Management Co.
840 Newport Center Drive
Newport Beach, CA 92658
Attention: Richard Weil/Raymond Kennedy
Telephone: (714) 717-7213 (Richard)
(714) 717-7363 (Raymond)
Facsimile: (714) 717-7076
-65-
<PAGE>
NORTHERN LIFE INSURANCE COMPANY
By:______________________________
Name:
Title:
Address for notices:
Northern Life Insurance Company
c/o Reliastar Investment Research, Inc.
100 Washington Avenue South, Suite 800
Minneapolis, MN 55401-2121
Attention: Tim Warrick, Vice President
Telephone: (612) 372-5258
Facsimile: (612) 372-5368
-66-
<PAGE>
KZH - SOLEIL CORPORATION
By:______________________________
Name:
Title:
Address for notices:
KZH - Soleil Corporation
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
-67-
<PAGE>
KZH HOLDING CORPORATION III
By:______________________________
Name:
Title:
Address for notices:
KZH Holding Corporation III
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
-68-
<PAGE>
KZH-CRESCENT CORPORATION
By:______________________________
Name:
Title:
Address for notices:
KZH-Crescent Corporation
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
-69-
<PAGE>
VAN KAMPEN AMERICAN CAPITAL
PRIME RATE INCOME TRUST
By:______________________________
Name:
Title:
VAN KAMPEN CLO I, LIMITED
by: Van Kampen American Capital
Management, Inc., as Collateral
Manager, as Assignee
By:______________________________
Name:
Title:
Address for notices:
Van Kampen American Capital
One Parkview Plaza
Oakbrook Terrace, IL 60181
Attention: Jeffrey Maillet
Telephone: (630) 684-6438
Facsimile: (630) 684-6740 or 6741
-70-
<PAGE>
CONTINENTAL ASSURANCE COMPANY
Separate Account (E)
By: TCW Asset Management Company as attorney-in-fact
By:________________________________________________
Name:
Title:
Address for notices:
By:________________________________________________
Name: Mark L. Gold
Title: Managing Director
Address for notices:
Continental Assurance Company
c/o TCW Asset Management Company
200 Park Avenue, Suite 2200
New York, NY 10166-0228
Attention: Mark L. Gold/Justin L. Driscoll
Telephone: (212) 297-4137
Facsimile: (212) 297-4159
-71-
<PAGE>
CIBC INC.
By:______________________________
Name:
Title:
Address for notices:
CIBC Inc.
c/o Canadian Imperial Bank of Commerce
425 Lexington Avenue, 7th Floor
New York, NY 10025
Attention: William Swenson
Telephone: (212) 856-3935
Facsimile: (212) 856-3799
-72-
<PAGE>
MORGAN STANLEY SENIOR FUNDING, INC.
By:______________________________
Name:
Title:
Address for notices:
MORGAN STANLEY SENIOR FUNDING, INC.
1585 Broadway, 10th Floor
New York, New York 10036
Attention: James Morgan
Telephone: (212) 761-4866
Facsimile: (212) 761-0592
-73-
<PAGE>
CRESCENT/MACH I PARTNERS, L.P.
by: TCW Asset Management Company,
its Investment Manager
By:______________________________
Name:
Title:
Address for notices:
Crescent/Mach I Partners L.P.
c/o State Street Bank & Trust Co.
Two International Place
Boston, MA 02110
Attention: Jackie Kilroy
Telephone: (617) 664-5477
Facsimile: (617) 664-5366
PLEASE COPY RATE SET NOTICE TO:
-------------------------------
Mark L. Gold/Justin L. Driscoll
Trust Company of the West
200 Park Avenue
New York, NY 10166
Telephone: (212) 297-4137
Fax: (212) 297-4159
-74-
<PAGE>
PHADMIN:68311
NEW YORK LIFE INSURANCE COMPANY
By:______________________________
Name:
Title:
Address for notices:
New York Life Insurance and
Annuity Corporation
c/o New York Life Insurance Company
51 Madison Avenue
Room 206
New York, New York 10010
Attention: Elise Chowdhry
Telephone: (212) 576-7830
Facsimile: (212) 447-4122
-75-
<PAGE>
CITY NATIONAL BANK
By:_______________________
Name:
Title:
Address for notices:
-76-
<PAGE>
TORONTO-DOMINION BANK
By:________________________
Address for notices:
The Toronto-Dominion Bank
909 Fannin, Suite 1700
Houston, TX 77010
Attention: Sonja R. Jordan
Telephone: 713/653-8244
Fax: 713/951-9921
-77-
<PAGE>
LEHMAN COMMERCIAL PAPER INC.
By:_________________________
Address for notices:
Lehman Commercial Paper Inc.
3 World Financial Center
New York, NY 10285
Attention: Michele Swanson
Telephone: 212/526-0330
Fax: 212/528-0819
-78-
<PAGE>
CAPTIVA II FINANCE LTD.
By:__________________________________________
Address for notices:
Captiva II Finance Ltd.
c/o Deutsche Morgan Grenfell (Cayman) Limited
P.O. Box 1984GT, Elizabethan Square
Grand Cayman, Cayman Islands
Attention: Director
Telephone: (345) 949-8244
Facsimile: (345) 949-8178
with a copy to:
Stanfield Capital Partners
175 Water Street
New York, NY 10038
Attention: Christopher Jansen
Telephone: (212) 602-3650
Facsimile: (212) 602-3670
-79-
<PAGE>
CERES FINANCE LTD.
By:____________________________________________
Address for notices:
Ceres Finance Ltd.
c/o Deutsche Morgan Grenfell (Cayman) Limited
P.O. Box 1984GT, Elizabethan Square
Grand Cayman, Cayman Islands
Attention: Director
Telephone: (345) 949-8244
Facsimile: (345) 949-8178
with a copy to:
Stanfield Capital Partners
175 Water Street
New York, NY 10038
Attention: Christopher Jansen
Telephone: (212) 602-3650
Facsimile: (212) 602-3670
-80-
<PAGE>
COOPERATIEVE CENTRALE RAIFFEIFEN-
BEORENLEENBANK B.A. "RABOBANK
NEDERLAND", NEW YORK BRANCH
By:______________________________
Name:
Title:
-81-
<PAGE>
AMARA-2 FINANCE LTD.
By:__________________________________
Name:
Title:
Address for notices:
Amara-2 Finance Ltd.
c/o Stanfield Capital Partners LLC
175 Water Street
New York, NY 10038
Attention: Christopher E. Janson
Telephone: (212) 602-3650
Facsimile: (212) 602-3670
-82-
<PAGE>
MLCBO IV (CAYMAN) LTD.
BY: PROTECTIVE ASSET MANAGEMENT
COMPANY, as Collateral Manager
By:_______________________________________
Name:
Title:
Address for notices:
MLCBO IV (CAYMAN) LTD.
c/o Protective Asset Management Company,
as Collateral Manager
13455 Noel Road
Dallas, TX 75240
Attention: Cathy Ragsdale
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
-83-
<PAGE>
PAMCO CAYMAN LTD.
BY: PROTECTIVE ASSET MANAGEMENT
COMPANY, as Collateral Manager
By:________________________________________
Name:
Title:
Address for notices:
PAMCO CAYMAN LTD.
c/o Protective Asset Management Company,
as Collateral Manager
13455 Noel Road
Dallas, TX 75240
Attention: Cathy Ragsdale
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
-84-
<PAGE>
JACKSON NATIONAL LIFE INSURANCE
COMPANY
By: PPM America, Inc., as attorney-
in-fact, on behalf of Jackson National
Life Insurance Company
By:___________________________________
Name: Michael DiRe
Title: Managing Director
Address for notices:
PPM America, Inc.
c/o Michael King
225 W. Wacker, Suite 1200
Chicago, IL 60606
Attention: Michael DiRe
Telephone: (312) 634-1206
Facsimile: (312) 634-0054
-85-
<PAGE>
CYPRESSTREE INVESTMENT PARTNERS I.,
Ltd.
By: CypressTree Investment Management
Company, Inc., as Portfolio Manager
By:___________________________________
Name: Philip C. Robbins
Title: Vice President
Address for notices:
-86-
<PAGE>
INDOSUEZ CAPITAL FUNDING III, LIMITED
By: Indosuez Capital, as Portfolio Advisor
By:________________________________________
Name:
Title:
Address for notices:
Indosuez Capital Funding III, Limited
c/o Texas Commerce Bank N.A.
A/C 17499
600 Travis Street, 8th Floor
Houston, TX 77002-8039
Attention: Joe Elston, Asset Backed Group
Telephone: (713) 216-2704
Facsimile: (713) 216-2101
-87-
<PAGE>
THE ROYAL BANK OF SCOTLAND plc
By:___________________________
Name: David Dougan
Title: Vice President
Address for notices:
The Royal Bank of Scotland plc
Wall Street Plaza
88 Pine Street, 26th Floor
New York, NY 10005
Attention: David Dougan
Telephone: (212) 269-0938
Facsimile: (212) 480-0791
-88-
<PAGE>
The foregoing Amendment No. 1
is acknowledged and agreed to
by the undersigned Surety (whether
in its capacity as Surety, pledgor
under the Pledge Agreement or
otherwise) as of the date
first above written.
GENESIS ELDERCARE CORP.
By:_________________
Name:
Title:
<PAGE>
Execution Copy
AMENDMENT NO. 2 AND WAIVER TO CREDIT AGREEMENT
(Multicare)
AMENDMENT NO. 2 AND WAIVER TO CREDIT AGREEMENT, dated as of
August 28, 1998, (this "Amendment No. 2") by and among: The Multicare Companies,
Inc. and certain Subsidiaries identified on the signature pages hereto as
"Borrowers"; the institutions identified on the signature pages hereto as
"Lenders"; Mellon Bank, N.A. as Issuer of Letters of Credit and as
Administrative Agent; Citicorp USA, Inc. as Syndication Agent; First Union
National Bank as Documentation Agent; and NationsBank, N.A. as Syndication
Agent.
Background
A Credit Agreement, dated as of October 9, 1997, was entered
into by and among The Multicare Companies, Inc. and certain of its Subsidiaries
as Borrowers, Mellon Bank, N.A. as Issuer of Letters of Credit and
Administrative Agent, Citicorp USA, Inc. as Syndication Agent, First Union
National Bank as Documentation Agent, NationsBank, N.A. as Syndication Agent,
and the Lenders and other Agents identified therein and was amended pursuant to
that certain Amendment No. 1 thereto, dated as of March 5, 1998. The Credit
Agreement, as so amended, is referred to herein as the "Current Credit
Agreement". The Current Credit Agreement, as the same may be amended, modified,
restated or supplemented from time to time is herein referred to as the "Credit
Agreement" or the "Agreement". Terms are used in this Amendment No. 2 as defined
in the Current Credit Agreement unless otherwise specified.
Concurrent with the execution of the original Credit Agreement
referred to above, an Affiliate of the Borrowers, Genesis Health Ventures, Inc.,
and certain of its Subsidiaries entered into a certain Third Amended and
Restated Credit Agreement, dated as of October 9, 1997, with Mellon Bank, N.A.
as Issuer of Letters of Credit and Administrative Agent, Citicorp USA, Inc. as
Syndication Agent, First Union National Bank as Documentation Agent,
NationsBank, N.A. as Syndication Agent and the Lenders identified therein, which
Agreement was amended as of March 5, 1998. (Such Third Amended and Restated
Credit Agreement, as so amended, and as the same may be further amended,
restated, modified or supplemented from time to time, is herein referred to as
the "Genesis Credit Agreement"). The Lenders parties to the Current Credit
Agreement are the same as the Lenders party to the Genesis Credit Agreement.
Pursuant to the terms of the Current Credit Agreement and the terms of the
Genesis Credit Agreement, each assignment by a Lender of its rights and
obligations with respect to any tranche of the Current Credit Agreement must be
made concurrent with an assignment by such Lender of a similar percentage of its
rights and obligations under the same tranche of the Genesis Credit Agreement.
1
<PAGE>
The Genesis Credit Agreement is being amended as of the date
hereof to provide for, among other things, an increase in the amount of the
revolving credit commitment thereunder, subject to certain conditions precedent.
The parties thereto and the parties hereto have decided that, at the time that
those conditions are satisfied and the amount of the revolving credit commitment
under the Genesis Credit Agreement is increased (as defined below, the "Revolver
Increase Effective Date"), the requirement for the concurrent assignment
provisions respecting the revolving credit commitments and revolving credit
loans under the two agreements should be eliminated. (No change is desired with
respect to assignments of rights and obligations relative to the term loans.)
In addition, the parties to the Current Credit Agreement wish
to amend the terms thereof respecting Qualifying Interest Rate Hedging
Agreements to provide that Affiliates of Lenders (and not just Lenders) may be
parties to Qualifying Interest Rate Hedging Agreements and thereby become
entitled to security under the Pledge Agreement. Accordingly, the parties to the
Current Credit Agreement wish to amend the terms of the Current Credit Agreement
(a) to eliminate the concurrent assignment requirements with respect to the
revolving credit loans and revolving credit commitments under the Genesis Credit
Agreement as of the date that the amount of the Genesis revolving credit
commitment is increased, (b) to provide that Affiliates of Lenders may share in
the pledged collateral with respect to obligations under certain Interest Rate
Hedging Agreements, (c) to make certain other changes to conform certain
provisions in the Credit Agreement to those in the Genesis Credit Agreement and
(d) to modify certain other provisions of the Current Credit Agreement as more
fully set forth below.
NOW THEREFORE, the parties hereto, intending to be legally
bound, hereby agree as follows.
Agreement
1. Amendments to Current Credit Agreement on Amendment No. 2
Effective Date. The Current Credit Agreement is amended in each of the following
respects, as of the Amendment No. 2 Effective Date (as defined in Section 4
below).
1.1 New Definitions. Each of the following new definitions
shall be added to Section 11.1 of the Current Credit Agreement (Certain
Definitions) in its correct alphabetical location and shall also apply in
construing this Amendment No. 2:
"Mandatorily Redeemable Stock" means all stock that is (i)
redeemable, payable or required to be purchased or otherwise
retired or extinguished (other than stock which is redeemable,
payable or required to be purchased under all circumstances for
consideration consisting solely of common stock of Multicare), or
convertible into any Indebtedness of the issuer, (A) at a fixed
or determinable date, whether by operation of a sinking fund or
2
<PAGE>
otherwise, (B) at the option of any Person other than the issuer
whether or not conditioned upon the occurrence of a circumstance
or event, such as a change in control of the issuer) or (C) upon
the occurrence of a condition not solely within the control of
the issuer, such as a redemption required to be made out of
future earnings or (ii) convertible into Mandatorily Redeemable
Stock.
"Revolver Increase Effective Date" has the meaning ascribed to
that term in the Genesis Credit Agreement.
1.2 Amendment to Certain Definitions. Each of the
following definitions set forth in Section 11.1 of the Current Credit Agreement
shall be amended in the manner specified below.
1.2.1 Applicable Margin Definition. The next-to-last
sentence of the definition of "Applicable Margin" shall be amended in its
entirety to read as follows:
The Applicable Margin shall be adjusted five Business Days after
receipt of the annual or quarterly Officer's Compliance
Certificate delivered pursuant to Section 6.1 and shall be based
on the Adjusted Total Debt to Cash Flow Ratio set forth therein.
1.2.2 Indebtedness Definition. Clause (b) of the
definition of "Indebtedness" shall be amended in its entirety to read as
follows:
all (i) obligations of such Person evidenced by bonds,
debentures, notes or similar instruments and (ii) Mandatorily Redeemable Stock;
1.2.3 Qualifying Interest Rate Hedging Agreements
Definition. The definition of "Qualifying Interest Rate Hedging Agreements"
shall be amended in its entirety to read as follows:
"Qualifying Interest Rate Hedging Agreements" means
such Interest Rate Hedging Agreements as may be entered into from
time to time pursuant to Section 6.12 above between any or all of
the Borrowers, on the one hand, and any Lender Party or any
Affiliate of a Lender Party that satisfies the conditions set
forth in Section 10.14 above, on the other hand.
1.3 Change in Notice Requirements Respecting Prepayment of
Revolving Credit Loans. In order to provide for a shorter notice period for the
prepayment of certain RC Loans, the first sentence of Section 1.5(c)(i) of the
Current Credit Agreement (Application and Timing of Prepayments/Notice) shall be
amended by adding the following proviso thereto immediately preceding the
period:
provided, however, that for any prepayment of RC Loans
(which is not part of a concurrent prepayment of Term
Loans), the Borrowers shall
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give the Administrative Agent notice, in the case of a
prepayment of Prime Rate Loans, no later than 11:00 A.M.
(Philadelphia time) one (1) Business Day before the date
of such prepayment and, in the case of a prepayment of
LIBO Rate Loans, no later than 11:00 A.M. (Philadelphia
time) three (3) Business Days before the date of such
prepayment.
1.4 Year 2000 Representation. A new paragraph (z) shall be
added immediately following paragraph (y) of Section 5.1 of the Current Credit
Agreement, which new paragraph shall read as follows:
(z) Year 2000 Compliance. Each of the Borrowers has
reviewed the areas within its business and operations
which could be adversely affected by a computer failure to
recognize and perform properly date sensitive functions
involving certain dates prior to, on or after January 1,
2000 ("Year 2000 Problem") and, if there are any such
areas, the Borrowers have developed and implemented plans
to avoid any Material Adverse Effect as a consequence of a
Year 2000 Problem. The Borrowers reasonably believe that
all internal computer operations that are material to
their respective business operations will be able to
perform properly date sensitive functions for all dates
before, on and after January 1, 2000 except to the extent
that a failure to do so could not reasonably be expected
to have a Material Adverse Effect.
1.5 Waiver and Amendment of Financial Reporting
Requirements for Excluded Subsidiaries. The phrase "[i]f at any time that the
Cash Flow of the Excluded Subsidiaries in the aggregate exceeds 3% of the Cash
Flow of Multicare and its consolidated Subsidiaries," which appears in
subparagraphs (a)(i) and (b)(i) of Section 6.1 is hereby amended by replacing
"3%" with "5.0%." This amendment shall be retroactively effective as of the
Closing Date and any failure to comply with the provisions as written in the
Current Credit Agreement (i.e., with the "3%" reference) prior to the Amendment
No. 2 Effective Date is hereby waived so long as the Borrowers shall have been
in compliance with the terms thereof as amended hereby (i.e., the "5.0%"
reference).
1.6 Amendment of Indebtedness Covenant. In order to allow
for some amortization of Indebtedness incurred under paragraph (e) of Section
8.1 of the Current Credit Agreement prior to the Maturity Date, said paragraph
(e) of Section 8.1 shall be amended in its entirety to read as follows:
(e) with respect to the Borrowers (but not the
Surety) other Indebtedness incurred from time to time, in an
aggregate outstanding principal amount not to exceed Fifteen
Million Dollars ($15,000,000.00) at any time so long as such
Indebtedness is incurred pursuant to agreements or instruments
(i) which do not cause a Default or Event of Default hereunder,
(ii) which contain terms and conditions no more onerous than
the terms and conditions hereof and (iii) pursuant to which no
more than five percent (5%) of the original principal amount of
such Indebtedness shall amortize (or be subject to required
prepayment) in any year;
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1.7 Amendment of Lien Covenant. Paragraph (d) of Section
8.2 of the Current Credit Agreement shall be amended by adding the words "and
the related Licenses" after the words "real estate and equipment" in the first
line thereof.
1.8 Joinder of Certain Affiliates as Parties to Qualifying
Interest Rate Hedging Agreements. Article 10 of the Current Credit Agreement is
amended by adding a new Section 10.14 at the end thereof which shall read as
follows:
10.14 JOINDER OF AFFILIATES AS PARTIES TO QUALIFYING
INTEREST RATE HEDGING AGREEMENTS; APPOINTMENT OF AGENT.
Any Affiliate of a Lender Party that now or hereafter is a
party to an Interest Rate Hedging Agreement entered into
with any Borrower or Borrowers pursuant to the terms of
this Agreement may become a secured party under the Pledge
Agreement (and the Interest Rate Hedging Agreement shall
thereby become a Qualifying Interest Rate Hedging
Agreement secured by the Collateral under the Pledge
Agreement) if (i) the Administrative Agent consents in
writing to such Person becoming a secured party (such
consent not to be unreasonably withheld) and (ii) such
Affiliate signs a Joinder to this Agreement agreeing to
the terms hereof. By signing a Joinder to this Agreement
in form and substance satisfactory to the Administrative
Agent, each such Affiliate shall be deemed to be a
"Lender" and a "Lender Party" for purposes of this Article
10 (but shall not be included as a Requisite Lender for
voting or other purposes) and shall be deemed to have
appointed the Administrative Agent as its agent for the
purposes set forth in the Loan Documents and to have
agreed to the exculpation and indemnification provisions
set forth in such Loan Documents relative to such agent.
Without limiting the generality of the foregoing, (a) the
Administrative Agent is authorized and directed to accept
any and all payments under the Loan Documents (including,
without limitation, the Pledge Agreement) on behalf of,
among others, such Affiliate and to make payments to,
among others, such Affiliate in accordance with the
provisions of the Loan Documents and (b) such Affiliate
understands that any Qualifying Interest Rate Hedging
Agreement shall be secured pari passu with the Loans and
other Obligations for so long as the Obligations under the
Credit Agreement remain outstanding and so secured, but
that such Affiliate is not entitled to voting or other
rights under this Agreement and the other Loan Documents.
2. Amendments to the Current Credit Agreement on the Revolver
Increase Effective Date. Each of the following amendments to the Current Credit
Agreement shall be effective as of the Revolver Increase Effective Date.
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2.1 Amendment of Special Intercreditor Provisions in
Connection with Severence of RC Commitments under Genesis Credit Agreement from
RC Commitments under Multicare Credit Agreement. Section 10 A.1 of the Current
Credit Agreement is amended by adding the following sentence at the end thereof:
Notwithstanding the foregoing, from and after the Revolver
Increase Effective Date, certain "RC Lenders" as defined
in the Genesis Credit Agreement may not be Lenders
hereunder and certain RC Lenders hereunder may not be
"Lenders" as defined in the Genesis Credit Agreement.
Accordingly, all RC Lenders hereunder that are not Lenders
under the Genesis Credit Agreement agree to abide by the
special intercreditor provisions set forth in this Article
10A (or any successor provisions) and the special
intercreditor provisions set forth in Article 10A of the
Genesis Credit Agreement (or any successor provisions) as
if a party thereto. Without limiting the generality of the
foregoing, without the written consent of the necessary
Lenders under the Genesis Credit Agreement, the parties
hereto will not amend, modify, supplement or restate the
provisions of this Agreement (currently set forth in 8.16
above) which sets forth tests respecting when management
fees under the Multicare Management Agreement may be paid
in cash, which provisions are incorporated by reference
into the Multicare Management Agreement. The Lenders party
to the Genesis Credit Agreement are intended third party
beneficiaries of this provision.
2.2 Assignments and Participations of RC Loans and RC
Commitments to be Independent of Genesis RC Loans and Genesis RC Commitments.
Clause (v) of paragraph (b) of Section 12.9 of the Current Credit Agreement
(Participations) shall be amended by adding the words "except with respect to
any interest in RC Loans and RC Commitments" immediately following the words
"with respect to any sale of a participation in any Tranche hereunder". Clause
(v) of paragraph (c) of Section 12.9 (Assignments) shall be amended by adding
the words "except with respect to any interest in RC Loans and RC Commitments"
immediately following the words "with respect to any assignment of an interest
in any Tranche hereunder".
2.3 Amendment to Form of Assignment and Acceptance
Agreement (Exhibit H) Relative to Requirement that Assignment of RC Loans and RC
Commitments be made Contemporaneously with Genesis RC Loans and RC Commitments.
Exhibit H to the Credit Agreement (Form of Assignment and Acceptance Agreement)
shall be amended (a) by replacing the words "as required by Section 12.9(c) of
the Credit Agreement" in paragraph E of the Recitals with the words "to the
extent required by Section 12.9(c) of the Credit Agreement" and (b) by adding
the words "As Applicable" after the phrase "To Be Delivered With Multicare
Assignment and Acceptance Agreement" in the box at the beginning of the
document.
3. Representations and Warranties. In order to induce the
Lenders, the Issuer and the Agents to agree to amend the Current Credit
Agreement, each of the Borrowers, jointly and severally, makes the following
representations and warranties, which shall survive the execution and delivery
of this Amendment No. 2.
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(a) The execution, delivery and performance of this
Amendment No. 2 does not require any consent of, notice
to, or filing with any governmental entity or any other
third party, does not violate the terms of any agreement
or instrument binding on any Borrower (including, without
limitation, the constituent documents of such Borrower)
or violate any Law applicable to such Borrower. On and
after the Amendment No. 2 Effective Date, the Current
Credit Agreement as amended by the amendments hereunder
to be effective on the Amendment No. 2 Effective Date,
shall be the legal, valid and binding obligation of each
Borrower enforceable against such Borrower in accordance
with its terms and, after the Revolver Increase Effective
Date, the Current Credit Agreement as so amended and as
further amended by the amendments hereunder to be
effective on the Revolver Increase Effective Date, shall
be the legal, valid and binding obligation enforceable
against such Borrower in accordance with its terms.
(b) No Default or Event of Default has occurred and
is continuing or would exist immediately after giving
effect to the amendments contained herein.
(c) Each of the representations and warranties set
forth in the Credit Agreement is true and correct in all
material respects both before and after giving effect to
the amendments and transactions contemplated hereby as
though each such representation and warranty were made at
and as of the date hereof and as of the Amendment No. 2
Effective Date and as of the Revolver Increase Effective
Date.
4. Amendment No. 2 Effective Date. The amendments set forth in
Section 1 (Amendments to Current Credit Agreement on Amendment No. 2 Effective
Date) above shall be effective on the date (the "Amendment No. 2 Effective
Date") that each of the following conditions is satisfied:
4.1 Execution of Amendment. Each of the Borrowers and the
Required Lenders shall have executed this Amendment No. 2 and the Surety shall
have executed the acknowledgement set forth below.
4.2 Execution of Amendment No. 2 to Genesis Credit
Agreement. Amendment No. 2 to the Genesis Credit Agreement shall have been
executed by the requisite parties.
4.3 Execution of Pledge Agreement Amendment. An Amendment
No. 1 to Pledge Agreement, in substantially the form attached hereto as Exhibit
A, shall have been executed by the Pledgors and Pledgee.
4.4 Other Documents and Information. The Administrative
Agent shall have received such other documents and information as it shall
reasonably request.
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5. Revolver Increase Effective Date. The amendments set forth
in Section 2 (Amendments to Current Credit Agreement on Revolver Increase
Effective Date) above shall be effective on the Revolver Increase Effective Date
provided that such date is on or after the Amendment No. 2 Effective Date.
6. Counterparts. This Amendment No. 2 may be executed in
counterparts and by different parties hereto in separate counterparts, each of
which, when executed and delivered, shall be deemed to be an original and all of
which, when taken together, shall constitute one and the same instrument. A
photocopied or facsimile signature shall be deemed to be the functional
equivalent of a manually executed original for all purposes.
7. Ratification. The Current Credit Agreement, as amended by
this Amendment No. 2, and the other Loan Documents, as amended in accordance
with the provisions hereof, are, and shall continue to be, in full force and
effect and are hereby in all respects confirmed, approved and ratified.
8. Payment of Expenses. Without limiting other payment
obligations of the Borrowers set forth in the Loan Documents, the Borrowers
hereby, jointly and severally, agree to pay all costs and expenses incurred by
the Administrative Agent in connection with the preparation, execution and
delivery of this Amendment No. 2 and any other documents or instruments which
may be delivered in connection herewith, including, without limitation, the
reasonable fees and expenses of its counsel, Drinker Biddle & Reath LLP.
9. Authorization to Agent. The Lenders hereby authorize the
Administrative Agent to take such action (including, without limitation, signing
amendments to Loan Documents) as shall be consistent with the purposes hereof
and as it shall deem necessary or appropriate to carry out the purposes of this
Amendment No. 2. Without limiting the generality of the foregoing, the Lenders
hereby authorize and direct the Administrative Agent to sign (on their behalf)
an Amendment No. 1 to the Pledge Agreement in substantially the form attached
hereto as Exhibit A.
10. Governing Law. This Amendment No. 2 shall be construed in
accordance with, and governed by, the laws of the Commonwealth of Pennsylvania,
without regard to choice of law principles.
11. References. From and after the Amendment No. 2 Effective
Date, or Revolver Increase Effective Date, as applicable, each reference in the
Credit Agreement to "this Agreement", "hereof", "hereunder" or words of like
import, and all references to the Credit Agreement in any and all Loan
Documents, other agreements, instruments, documents, certificates and writings
of every kind and nature, shall be deemed to mean the Current Credit Agreement
as modified and amended by this Amendment No. 2 and as the same may be further
amended, modified or supplemented in accordance with the terms thereof.
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IN WITNESS WHEREOF, the parties have caused this Amendment No.
2 to be duly executed as of the date first above written.
BORROWERS:
THE MULTICARE COMPANIES, INC., a
Delaware corporation
By_______________________________
Name: Barbara J. Hauswald
Title: Treasurer
Address for notices:
101 East State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
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ADS APPLE VALLEY LIMITED PARTNERSHIP, a Massachusetts limited partnership, by:
ADS Apple Valley, Inc. its General Partner
ADS DARTMOUTH GENERAL PARTNERSHIP, a Massachusetts general partnership, by ADS
Dartmouth ALF, Inc. and ADS Senior Housing, Inc., its General Partners
ADS HINGHAM LIMITED PARTNERSHIP, a Massachusetts limited partnership, by ADS
Hingham Nursing Facility, Inc., its General Partner
ADS RECUPERATIVE CENTER LIMITED PARTNERSHIP, a Massachusetts limited
partnership, by ADS Recuperative Center, Inc., its General Partner
CARE HAVEN ASSOCIATES LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Cumberland, Inc., its General Partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
GROTON ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Groton, Inc., its General Partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited
partnership, by Health Resources of Middletown (R.I.), Inc., its General Partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc., its General Partner
RALEIGH MANOR LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
ROMNEY HEALTH CARE CENTER LTD., LIMITED PARTNERSHIP, a West Virginia limited
partnership, by Glenmark Associates, Inc., its General Partner SISTERVILLE HAVEN
LIMITED PARTNERSHIP, a West Virginia limited partnership, by Glenmark
Associates, Inc., its General Partner
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
THE STRAUS GROUP - HOPKINS HOUSE, L.P., a New Jersey limited partnership, by
Encare of Wyncote, Inc., its General Partner
THE STRAUS GROUP - QUAKERTOWN MANOR, L.P., a New Jersey limited partnership, by
Encare of Quakertown, Inc., its General Partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Wallingford, Inc., its General Partner
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WARWICK ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Warwick, Inc., its General Partner
By: ______________________________
On behalf of each of the foregoing
General Partners by Barbara J. Hauswald,
Treasurer
HOLLY MANOR ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Encare of Mendham, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Breyut Convalescent Center, L.L.C., its General Partner, by Century Care
Management, Inc., its authorized manager
POMPTON ASSOCIATES, L.P., a New Jersey limited partnership, by Pompton Corp.,
L.L.C., its General Partner, by Century Care Management, Inc., its authorized
manager
THE STRAUS GROUP - OLD BRIDGE, L.P., a New Jersey limited partnership, by Health
Resources of Emery, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
THE STRAUS GROUP - RIDGEWOOD, L.P., a New Jersey limited partnership, by Health
Resources of Ridgewood, L.L.C., its General Partner, by Century Care Management,
sInc., its authorized manager
By:__________________________
On behalf of each of the foregoing
General Partners by Barbara J.
Hauswald as Treasurer of the
Authorized Manager
Address for notices:
101 East State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
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ACADEMY NURSING HOME, INC., a Massachusetts corporation
ADS APPLE VALLEY, INC., a Massachusetts corporation
ADS CONSULTING, INC., a Massachusetts corporation
ADS DANVERS ALF, INC., a Delaware corporation
ADS DARTMOUTH ALF, INC., a Delaware corporation
ADS HINGHAM ALF, INC., a Delaware Corporation
ADS HINGHAM NURSING FACILITY, INC., a Massachusetts corporation
ADS HOME HEALTH, INC., a Delaware corporation
ADS MANAGEMENT, INC., a Massachusetts corporation
ADS/MULTICARE, INC., a Delaware corporation
ADS RECUPERATIVE CENTER, INC., a Massachusetts corporation
ADS SENIOR HOUSING, INC., a Massachusetts corporation
ADS VILLAGE MANOR, INC., a Massachusetts corporation
ANR, INC., a Delaware corporation
APPLEWOOD HEALTH RESOURCES, INC., a Delaware corporation
AUTOMATED PROFESSIONAL ACCOUNTS, INC., a West Virginia corporation
BERKS NURSING HOMES, INC., a Pennsylvania corporation
BETHEL HEALTH RESOURCES, INC., a Delaware corporation
BRIGHTWOOD PROPERTY, INC., a West Virginia corporation
CENTURY CARE CONSTRUCTION, INC., a New Jersey corporation
CENTURY CARE MANAGEMENT, INC., a Delaware corporation
CHATEAU VILLAGE HEALTH RESOURCES, INC., a Delaware corporation
CHG INVESTMENT CORP., INC., a Delaware corporation
CHNR-I, INC., a Delaware corporation
COLONIAL HALL HEALTH RESOURCES, INC., a Delaware corporation
COLONIAL HOUSE HEALTH RESOURCES, INC., a Delaware corporation
CONCORD HEALTH GROUP, INC., a Delaware corporation
CONCORD HOME HEALTH, INC., a Pennsylvania corporation
CONCORD REHAB, INC., a Pennsylvania corporation
CONCORD SERVICE CORPORATION, a Pennsylvania corporation
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CVNR, INC., a Delaware corporation
DELM NURSING, INC., a Pennsylvania corporation
ELMWOOD HEALTH RESOURCES, INC., a Delaware corporation
ENCARE OF PENNYPACK, INC., a Pennsylvania corporation
ENCARE OF QUAKERTOWN, INC., a Pennsylvania corporation
ENCARE OF WYNCOTE, INC., a Pennsylvania corporation
ENR, INC., a Delaware corporation
GLENMARK ASSOCIATES, INC., a West Virginia corporation
GMA - BRIGHTWOOD, INC., a West Virginia corporation
GMA CONSTRUCTION, INC., a West Virginia corporation
GMA - MADISON, INC., a West Virginia corporation
GMA PARTNERSHIP HOLDING COMPANY, INC., a West Virginia corporation
GMA - UNIONTOWN, INC., a Pennsylvania corporation
HEALTH RESOURCES OF BOARDMAN, INC., a Delaware corporation
HEALTH RESOURCES OF CEDAR GROVE, INC., a New Jersey corporation
HEALTH RESOURCES OF COLCHESTER, INC., a Connecticut corporation
HEALTH RESOURCES OF COLUMBUS, INC., a Delaware corporation
HEALTH RESOURCES OF CUMBERLAND, INC., a Delaware corporation
HEALTH RESOURCES OF EATONTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF FARMINGTON, INC., a Delaware corporation
HEALTH RESOURCES OF GARDNER, INC., a Delaware corporation
HEALTH RESOURCES OF GLASTONBURY, INC., a Connecticut corporation
HEALTH RESOURCES OF GROTON, INC., a Delaware corporation
HEALTH RESOURCES OF LAKEVIEW, INC., a New Jersey corporation
HEALTH RESOURCES OF LEMONT, INC., a Delaware corporation
HEALTH RESOURCES OF LYNN, INC., a New Jersey corporation
HEALTH RESOURCES OF KARMENTA AND MADISON, INC., a Delaware corporation
HEALTH RESOURCES OF MARCELLA, INC., a Delaware corporation
HEALTH RESOURCES OF MIDDLETOWN (R.I.), INC., a Delaware corporation
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HEALTH RESOURCES OF MORRISTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF NORFOLK, INC., a Delaware corporation
HEALTH RESOURCES OF NORWALK, INC., a Connecticut corporation
HEALTH RESOURCES OF PENNINGTON, INC., a New Jersey corporation
HEALTH RESOURCES OF ROCKVILLE, INC., a Delaware corporation
HEALTH RESOURCES OF SOUTH BRUNSWICK, INC., a New Jersey corporation
HEALTH RESOURCES OF TROY HILLS, INC., a New Jersey corporation
HEALTH RESOURCES OF WALLINGFORD, INC., a Delaware corporation
HEALTH RESOURCES OF WARWICK, INC., a Delaware corporation
HEALTHCARE REHAB SYSTEMS, INC., a Pennsylvania corporation
HORIZON ASSOCIATES, INC., a West Virginia corporation
HORIZON MOBILE, INC., a West Virginia corporation
HORIZON REHABILITATION, INC., a West Virginia corporation
HR OF CHARLESTON, INC., a West Virginia corporation
HRWV Huntington, Inc., a West Virginia corporation
LAKEWOOD HEALTH RESOURCES, INC., a Delaware corporation
LAUREL HEALTH RESOURCES, INC., a Delaware corporation
LEHIGH NURSING HOMES, INC., a Pennsylvania corporation
LWNR, INC., a Delaware corporation
MABRI CONVALESCENT CENTER, INC., a Connecticut corporation
MARKGLEN, INC., a West Virginia corporation
MARSHFIELD HEALTH RESOURCES, INC., a Delaware corporation
MONTGOMERY NURSING HOMES, INC., a Pennsylvania corporation
MULTICARE AMC, INC., a Delaware Corporation
MULTICARE HOME HEALTH OF ILLINOIS, INC., a Delaware corporation
NURSING AND RETIREMENT CENTER OF THE ANDOVERS, INC., a Massachusetts corporation
PHC OPERATING CORP., a Delaware corporation
POCAHONTAS CONTINUOUS CARE CENTER, INC., a West Virginia corporation
PRESCOTT NURSING HOME, INC., a Massachusetts corporation
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PROGRESSIVE REHABILITATION CENTERS, INC., a Delaware corporation
PROVIDENCE HEALTH CARE, INC., a Delaware corporation
REST HAVEN NURSING HOME, INC, a West Virginia corporation
RIDGELAND HEALTH RESOURCES, INC., a Delaware corporation
RIVER PINES HEALTH RESOURCES, INC., a Delaware corporation
RIVERSHORES HEALTH RESOURCES, INC., a Delaware corporation
RLNR, INC., a Delaware corporation
ROSE HEALTHCARE, INC., a New Jersey corporation
ROSE VIEW MANOR, INC., a Pennsylvania corporation
RSNR, INC., a Delaware corporation
RVNR, INC., a Delaware corporation
SENIOR LIVING VENTURES, INC., a Pennsylvania corporation
SCHUYLKILL NURSING HOMES, INC., a Pennsylvania corporation
SCHUYLKILL PARTNERSHIP ACQUISITION CORP., a Pennsylvania corporation
SENIOR SOURCE, INC., a Massachusetts corporation
SNOW VALLEY HEALTH RESOURCES, INC., a Delaware corporation
SOLOMONT FAMILY FALL RIVER VENTURE, INC., a Massachusetts corporation
SOLOMONT FAMILY MEDFORD VENTURE, INC., a Massachusetts corporation
STAFFORD CONVALESCENT CENTER, INC., a Delaware corporation
S.T.B. INVESTORS, LTD., a New York corporation
SVNR, INC., a Delaware corporation
THE ADS GROUP, INC., a Massachusetts corporation
TRI-STATE MOBILE MEDICAL SERVICES, INC., a West Virginia corporation
WESTFORD NURSING AND RETIREMENT CENTER, INC., a Massachusetts corporation
15
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WILLOW MANOR NURSING HOME, INC., a Massachusetts corporation
By:___________________________________
Barbara J. Hauswald as Treasurer on
behalf of each of the foregoing
Address for notices:
101 East State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Esq.
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
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BREYUT CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
ENCARE OF MENDHAM, L.L.C., a New Jersey limited liability company, by Century
Care Management, Inc., its authorized manager
HEALTH RESOURCES OF BRIDGETON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CINNAMINSON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CRANBURY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EMERY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF ENGLEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EWING, L.L.C., a New Jersey limited liability company. by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF FAIR LAWN, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF JACKSON, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF RIDGEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF WEST ORANGE, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
POMPTON CARE, L.L.C., a New Jersey limited liability company, by Century Care
Management, Inc., its authorized manager
ROEPHEL CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
By:______________________________
On behalf of each of the foregoing Authorized
Managers by its Treasurer
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The foregoing Amendment No. 2 is acknowledged and agreed to by the undersigned
Surety (whether in its capacity as Surety, pledgor under the Pledge Agreement or
otherwise) as of the date first above written.
GENESIS ELDERCARE CORP.
By:______________________
Name: Barbara J. Hauswald
Title: Treasurer
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AGENTS, ISSUER AND LENDERS:
MELLON BANK, N.A., as a Lender,
as Issuer and as Administrative Agent
By______________________________________
Name: Michael J. Fox
Title: Vice President
Address for notices:
street address:
AIM 199-5220
Mellon Independence Center
701 Market Street
Philadelphia, Pennsylvania 19106
mailing address:
AIM 199-5220
P.O. Box 7899
Philadelphia, Pennsylvania 19101-7899
Attention: Linda Sigler,
Loan Administration
Telephone: 215-553-4583
Facsimile: 215-553-4789
19
<PAGE>
With a copy to
Plymouth Meeting Executive Campus
610 W. Germantown Pike, Suite 200
Plymouth Meeting, Pennsylvania 19462
Attention: Michael Fox
Vice President
Telephone: 610-941-8426
Facsimile: 610-941-4136
With a copy for notices respecting assignments to:
MELLON BANK, N.A.
One Mellon Bank Center
45th Floor
Pittsburgh, PA 15258-0001
Attention: Dean Hazelton
Telephone: 412-236-0316
Facsimile: 412-234-4612
20
<PAGE>
CITICORP USA, INC., as a Lender and as Syndication
Agent
By__________________________________________________
Name:
Title:
Address for notices:
399 Park Avenue
8th Floor, Zone 6
New York, NY 10043
Attention: Margaret A. Brown
Telephone: 212-559-0501
Facsimile: 212-793-0289
21
<PAGE>
FIRST UNION NATIONAL BANK, as a Lender and as
Documentation Agent
By___________________________________________
Name:
Title:
FIRST UNION NATIONAL BANK (as successor to
CORESTATES BANK, N.A.)
By___________________________________________
Name:
Title:
Address for notices:
One First Union Center TW-5
Charlotte, NC 28288-0735
Attention: Matt MacIver
Telephone: 704-374-4187
Facsimile: 704-383-9144
22
<PAGE>
NATIONSBANK, N.A., as a Lender and as a
Syndication Agent
By_______________________________
Name:
Title:
Address for notices:
101 North Tryon Street
15th Floor Charlotte,
NC 28255 NC1-001-15-11
Attention: Jacquetta Banks
Telephone: 704-388-1111
Facsimile: 704-386-8694
With a copy to
100 North Tryon Street
8th Floor Charlotte,
NC 28255 NC1-007-0813
Attention: Scott Ward
Telephone: 704-388-7839
Facsimile: 704-388-6002
23
<PAGE>
CREDIT LYONNAIS NEW YORK BRANCH
By:_______________________________________
Name:
Title:
Address for notices:
Credit Lyonnais New York Branch
1301 Avenue of the Americas
New York, NY 10019
Attention: John C. Oberle
Telephone: (212) 261-7344
Facsimile: (212) 261-3440
24
<PAGE>
FLEET NATIONAL BANK
By:_____________________________________
Name:
Title:
Address for notices:
Fleet National Bank
One Federal Street
MA OF D07B
Boston, MA 02110
Attention: Carol Paige
Telephone: (617) 346-4619
Facsimile: (617) 346-4699
25
<PAGE>
THE INDUSTRIAL BANK OF JAPAN, LIMITED
By:_____________________________________________
Name:
Title:
Address for notices:
The Industrial Bank of Japan, Limited
1251 Avenue of the Americas
New York, NY 10020
Attention: Randall Wernes
Telephone: (212) 282-3461
Facsimile: (212) 282-4488
26
<PAGE>
NATIONAL WESTMINSTER BANK Plc
By:____________________________________
Name:
Title:
Address for notices:
National Westminster Bank Plc
175 Water Street, 26th Floor
New York, NY 10038
Attention: Andrew Weinberg
Phone: (212) 418-4567
Facsimile: (212) 418-4594
with a copy to:
Gleacher NatWest Inc.
660 Madison Avenue, 17th Floor
New York, NY 10021
Attention: Field Smith
Telephone: (212) 418-4525
Facsimile: (212) 418-4598
27
<PAGE>
THE SAKURA BANK, LIMITED
By:_______________________________________
Name:
Title:
Address for notices:
The Sakura Bank, Limited
277 Park Avenue, 45th Floor
New York, NY 10172
Attention: Philip Schubert
Telephone: (212) 756-6945
Facsimile: (212) 888-7651
28
<PAGE>
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By:_____________________________________
Name:
Title:
Address for notices:
Bank of America National Trust
& Savings Associations
555 S. Flower Street, 11th Floor
Los Angeles, CA 90071
Attention: Anthony Trunzo
Telephone: (213) 228-9718
Facsimile: (213) 228-2756
29
<PAGE>
PARIBAS
By:________________________________________
Name:
Title:
By:________________________________________
Name:
Title:
Address for notices:
Paribas
787 Seventh Avenue
New York, NY 10019
Attention: David R. Laffey
Telephone: (212) 841-2116
Facsimile: (212) 841-2292
30
<PAGE>
BANKBOSTON, N.A.
By:____________________________________
Name:
Title:
Address for notices:
BankBoston, N.A.
100 Federal Street, 01-08-06
Boston, MA 02110
Attention: William R. Rogers
Telephone: (617) 434-6247
Facsimile: (617) 434-0819
31
<PAGE>
THE BANK OF NEW YORK
By:_____________________________________
Name:
Title:
Address for notices:
The Bank of New York
One Wall Street, 21st Floor
New York, NY 10286
Attention: Walter C. Parelli
Telephone: (212) 635-6820
Facsimile: (212) 635-7970
32
<PAGE>
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By:___________________________________________
Name:
Title:
Address for notices:
Bank of Tokyo-Mitsubishi Trust Company
1251 Avenue of the Americas, 12th Floor
New York, NY 10020-1104
Attention: Douglas Weir
Telephone: (212) 782-4503
Facsimile: (212) 782-4979
33
<PAGE>
CRESTAR BANK
By:______________________________________
Name:
Title:
Address for Notices:
Crestar Bank
120 E. Baltimore Street, 25th Floor
Baltimore, MD 21202
Attention: Andrea Robinson
Telephone: (410) 986-1686
Facsimile: (410) 986-1012
34
<PAGE>
DRESDNER BANK AG, NEW YORK
BRANCH AND GRAND CAYMAN BRANCH
By:__________________________________
Name:
Title:
By:__________________________________
Name:
Title:
Address for notices:
Dresdner Bank AG, New York
75 Wall Street, 25th Floor
New York, NY 10005-2889
Attention: Felix K. Camacho
Telephone: (212) 429-3007
Facsimile: (212) 429-2129
35
<PAGE>
FINOVA CAPITAL CORPORATION
By:____________________________________
Name:
Title:
Address for notices:
Finova Capital Corporation
311 S. Wacker, Suite 4400
Chicago, IL 60606
Attention: Brian Williamson
Telephone: (312) 294-4175
Facsimile: (312) 322-3553
36
<PAGE>
KEY CORPORATE CAPITAL INC.
By:_________________________________
Name:
Title:
Address for notices:
Key Corporate Capital Inc.
c/o Key Bank, N.A.
127 Public Square
Cleveland, OH 44114
Attention: Angela Mago
OH-01-27-0605
Telephone: (216) 689-3247
Facsimile: (216) 689-5970
37
<PAGE>
FIRST NATIONAL BANK OF MARYLAND
By:_________________________________
Name:
Title:
Address for notices:
First National Bank of Maryland
25 S. Charles Street, 18th Floor
Baltimore, MD 21201
Attention: Robert H. Hauver
Telephone: (410) 244-4246
Facsimile: (410) 244-4388
38
<PAGE>
NATEXIS BANQUE BFCE
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
Address for notices:
Natexis Banque BFCE
645 Fifth Avenue, 20th Floor
New York, NY 10022
Attention: Frank Madden
Telephone: (212) 872-5180
Facsimile: (212) 872-5045
39
<PAGE>
NATIONAL CITY BANK OF
PENNSYLVANIA
By:_____________________________________
Name:
Title:
Address for notices:
National City Bank of Pennsylvania
20 Stanwix Street, 46-25-191
Pittsburgh, PA 15222
Loc. 46-25-191
Attention: Debra W. Riefner
Telephone: (412) 644-8880
Facsimile: (412) 471-4883
40
<PAGE>
THE SANWA BANK, LIMITED
By:___________________________________
Name:
Title:
Address for notices:
The Sanwa Bank, Limited
55 E. 52nd Street
New York, NY 10055
Attention: Jean-Michel Fatovic
Telephone: (212) 339-6397
Facsimile: (212) 754-1304
41
<PAGE>
THE SUMITOMO BANK, LIMITED
By:___________________________________
Name:
Title:
By:___________________________________
Name:
Title:
Address for notices:
The Sumitomo Bank, Limited
450 Lexington Avenue, Suite 1700
New York, NY 10017
Attention: Brian Smith
Telephone: (212) 808-2325
Facsimile: (212) 818-0867
42
<PAGE>
SUMMIT BANK
By:_______________________________________________
Name: James P. Andersen
Title: Vice President and Regional Manager
Address for notices:
Summit Bank
250 Moore Street, 2nd Floor
Hackensack, NJ 07601
Attention: Christine Clausen
Telephone: (201) 646-5080
Facsimile: (201) 646-9497
43
<PAGE>
THE DAI-ICHI KANGYO BANK, LTD.
By:_______________________________________
Name:
Title:
Address for notices:
The Dai-Ichi Kangyo Bank, Ltd.
One World Trade Center, 48th Floor
New York, NY 10048
Attention: Takayuki Kumagai
Telephone: (212) 432-6651
Facsimile: (212) 488-8955
44
<PAGE>
CREDITANSTALT CORPORATE
FINANCE, INC.
By:__________________________________________
Name:
Title:
By:__________________________________________
Name:
Title:
Address for notices:
Creditanstalt Corporate Finance, Inc.
Two Greenwich Plaza
Greenwich, CT 06830
Attention: Bill Magee
Telephone: (203) 861-6587
Facsimile: (203) 861-0297
45
<PAGE>
CREDIT SUISSE FIRST BOSTON
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
Address for notices:
Credit Suisse First Boston
11 Madison Avenue
New York, NY 10010
Attention: Robert B. Potter
Telephone: (212) 325-9154
Facsimile: (212) 325-8319
46
<PAGE>
FIRST NATIONAL BANK OF CHICAGO
By:_______________________________
Name:
Title:
Address for notices:
First National Bank of Chicago
1 First National Plaza
Chicago, IL 60670
Attention: Tom Harkless
Telephone: (312) 732-2478
Facsimile: (312) 732-2016
47
<PAGE>
SCOTIABANC, INC.
By:______________________________
Name:
Title:
Address for notices:
ScotiaBanc, Inc.
600 Peachtree Street NE
Suite 2700
Atlanta, GA 30308
Attention: Dana Maloney
Telephone: (404) 877-1524
Facsimile: (404) 888-8998
48
<PAGE>
CIBC INC.
By:_________________________________
Name:
Title:
Address for notices:
CIBC Inc.
425 Lexington Avenue, 8th Floor
New York, NY 10025
Attention: Judith Kirshner
Telephone: (212) 856-3547
Facsimile: (212) 856-2991
49
<PAGE>
AMSOUTH BANK
By:_______________________________
Name:
Title:
Address for notices:
AmSouth Bank
1900 5th Ave. N. AST7FL
Birmingham, AL 35203
Attention: Ken DiFatta
Telephone: (205) 801-0358
Facsimile: (205) 326-4790
50
<PAGE>
PFL LIFE INSURANCE
COMPANY
By:____________________________________________
Name:
Title:
Address for notices:
PFL Life Insurance Company
c/o Aegon USA Investment Management, Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Attention: John Bailey, Securities Analyst
Telephone: (319) 369-2811
Facsimile: (319) 369-2666
51
<PAGE>
PEOPLES LIFE INSURANCE COMPANY
By:___________________________________________
Name:
Title:
Address for notices:
Peoples Life Insurance Company
c/o Aegon USA Investment Management, Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Attention: John Bailey, Securities Analyst
Telephone: (319) 369-2811
Facsimile: (319) 369-2666
Payment Advice
Attention: Marla Johnson
Peoples Security Life Insurance Company
c/o AEGON USA Investment Management, Inc.
4333 Edgewood Road N.E.
Cedar Rapids, IA 52499-5112
Fax Number: (319) 398-8695
52
<PAGE>
FLOATING RATE PORTFOLIO
By: INVESCO Senior Secured
Management, Inc., as attorney in fact
By:_______________________________
Address for notices:
Floating Rate Portfolio
c/o INVESCO Senior Secured
Management, Inc.
1166 Avenue of the Americas, 27th Floor
New York, NY 10036
Attention: Kathleen Lenarcic
Telephone: (212) 278-9794
Facsimile: (212) 278-9619
53
<PAGE>
MORGAN STANLEY DEAN WITTER
PRIME INCOME TRUST
By:_______________________________
Name:
Title:
Address for notices:
Morgan Stanley Dean Witter
Prime Income Trust
c/o Morgan Stanley Dean Witter Advisors
72nd Floor
Two World Trade Center
New York, NY 10048
Attention: Kevin Egan
Telephone: (212) 392-5845
Facsimile: (212) 392-5345
54
<PAGE>
DEEPROCK & COMPANY
By: Eaton Vance Management
as Investment Advisor
By:______________________________
Name:
Title:
Address for notices:
State Street Bank & Trust Company
Corporate Trust Division
One Enterprise Drive
North Quincy, MA 02171
Attention: Patrick McEnroe
Telephone: (617) 664-5367
Facsimile: (617) 664-5366
Eaton Vance Management
Attention: Prime Rate Reserves
24 Federal Street, 6th Floor
Boston, MA 02110
Attention: Payson Swaffield
Telephone: (617) 654-8486
Telecopier: (617) 695-9594
Reference:
55
<PAGE>
ING HIGH INCOME PRINCIPAL
PRESERVATION FUND HOLDINGS, LDC
By: ING Capital Advisors, Inc.,
As Investment Advisor
By:_______________________________
Name:
Title:
Address for notices:
ING High Income Principal Preservation
Fund Holdings, LDC
c/o ING Capital Advisors, Inc.
233 S. Wacker Drive # 5200
Chicago, IL 60606
Attention: Jane Musser Nelson
Telephone: (312) 496-7606
Facsimile: (312) 496-7611
56
<PAGE>
SENIOR DEBT PORTFOLIO
BY: Boston Management and Research
as Investment Advisor
By:____________________________
Name:
Title:
Address for notices:
Eaton Vance Management
Attention: Prime Rate Services
24 Federal Street, 6th Floor
Boston, MA 02110
Attention: Payson Swaffield
Telephone: (617) 654-8486
Facsimile: (617) 695-9594
57
<PAGE>
MASSACHUSETTS MUTUAL LIFE
INSURANCE CO.
By:____________________________
Name:
Title:
Address for notices:
Massachusetts Mutual Life Insurance Co.
1295 State Street
Springfield, MA 01111
Attention: John Wheeler, Managing Director
Telephone: (413) 744-6228
Facsimile: (413) 744-6127
58
<PAGE>
MERRILL LYNCH SENIOR FLOATING
RATE FUND, INC.
By:____________________________
Name:
Title:
MERRILL LYNCH PRIME RATE
PORTFOLIO
By: Merrill Lynch Asset Management,
L.P., as Investment Advisor
By:____________________________
Name:
Title:
Address for notices:
Merrill Lynch Senior Floating Rate Fund, Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road - Area 1B
Plainsboro, NJ 08536
Attention: Colleen Cunniffe
Telephone: (609) 282-2093
Facsimile: (609) 282-2756
59
<PAGE>
MERRILL LYNCH GLOBAL INVESTMENT SERIES
Income Strategies Portfolio
By: Merrill Lynch Asset Management, L.P., as
Investment Advisor
As assignee
By:____________________________
Name:
Title:
Address for notices:
Merrill Lynch Global Investment Series
c/o Merrill Lynch Asset Management, L.P.
800 Scudders Mill Road - Area 1B
Plainsboro, NJ 08536
Attention: Colleen Cunniffe
Telephone: (609) 282-2093
Facsimile: (609) 282-2756
60
<PAGE>
METROPOLITAN LIFE INSURANCE
COMPANY
By:____________________________
Name:
Title:
Address for notices:
Metropolitan Life Insurance Company
334 Madison Avenue
Convent Station, NJ 07961-0633
Attention: James Dingler
Asst. Vice President
Telephone: (201) 254-3206
Facsimile: (201) 254-3050
61
<PAGE>
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By:____________________________
Name:
Title: Its Authorized Representative
Address for notices:
The Northwestern Mutual Life Insurance
Company
720 E. Wisconsin Avenue
Milwaukee, WI 53202
Attention: David A. Barras
Director-Investments
Northwestern Investment Management
Company
Telephone: (414) 299-1618
Facsimile: (414) 299-7124
62
<PAGE>
NEW YORK LIFE INSURANCE
AND ANNUITY CORPORATION
By: New York Life Insurance Company
By:____________________________
Name:
Title:
Address for notices:
New York Life Insurance and Annuity
Corporation
c/o New York Life Insurance Company
51 Madison Avenue, Room 206
New York, NY 10010
Attention: Charles Riceman
Telephone: (212) 576-4260
Facsimile: (212) 447-4122
63
<PAGE>
OAK HILL SECURITIES FUND, L.P.
By: Oak Hill Securities GenPar, L.P.,
Its General Partner
By: Oak Hill Securities MGP, Inc.,
Its General Partner
By:____________________________
Name:
Title:
Address for notices:
Oak Hill Securities Fund, L.P.
c/o O'Sullivan Graev & Karabell, LLP
30 Rockefeller Plaza
New York, NY 10112
Attention: John Ashmead, Esq.
Telephone: (212) 408-2494
Facsimile: (212) 728-5950
64
<PAGE>
OCTAGON LOAN TRUST
By:____________________________
Name:
Title:
Address for notices:
Octagon Loan Trust
380 Madison Avenue, 12th Floor
New York, NY 10017
Attention: James P. Ferguson
Managing Director
Telephone: (212) 622-3070
Facsimile: (212) 622-3797
65
<PAGE>
PARIBAS CAPITAL FUNDING LLC
By:____________________________
Name:
Title:
Address for notices:
Paribas Capital Funding LLC
787 Seventh Avenue, 32nd Floor
New York, NY 10019
Attention: Michael Weinberg
Telephone: (212) 841-2544
Facsimile: (212) 841-2144
with a copy to:
State Street Bank & Trust Co.
Corporate Trust Dept.
Attn: Bill Connolly
Phone: (617) 664-5410
Fax: (617) 664-5366(67)(68)
66
<PAGE>
ROYALTON COMPANY
By: Pacific Investment Management
Company, as its Investment Advisor
By:____________________________
Name:
Title:
Address for notices:
Royalton Company
c/o Pacific Investment Management Co.
840 Newport Center Drive
Newport Beach, CA 92658
Attention: Richard Weil/Raymond Kennedy
Telephone: (714) 717-7213 (Richard)
(714) 717-7363 (Raymond)
Facsimile: (714) 717-7076
67
<PAGE>
NORTHERN LIFE INSURANCE
COMPANY
By:____________________________
Name:
Title:
Address for notices:
Northern Life Insurance Company
c/o Reliastar Investment Research, Inc.
100 Washington Avenue South, Suite 800
Minneapolis, MN 55401-2121
Attention: Tim Warrick, Vice President
Telephone: (612) 372-5258
Facsimile: (612) 372-5368
68
<PAGE>
KZH SOLEIL LLC
By:____________________________
Name:
Title:
Address for notices:
KZH Soleil LLC
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
69
<PAGE>
KZH III LLC
By:____________________________
Name:
Title:
Address for notices:
KZH III LLC c/o The
Chase Manhattan Bank
450 West 33rd Street -
15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
70
<PAGE>
KZH CRESCENT LLC
By:____________________________
Name:
Title:
Address for notices:
KZH Crescent LLC
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
71
<PAGE>
VAN KAMPEN AMERICAN CAPITAL
PRIME RATE INCOME TRUST, as assignee
By:____________________________
Name:
Title:
VAN KAMPEN CLO I, LIMITED
by: Van Kampen American Capital
Management, Inc., as Collateral
Manager, as Assignee
By:____________________________
Name:
Title:
VAN KAMPEN AMERICAN CAPITAL
SENIOR INCOME TRUST
By:____________________________
Name:
Title:
Address for notices:
In care of:
Van Kampen American Capital
One Parkview Plaza
Oakbrook Terrace, IL 60181
Attention: Jeffrey Maillet
Telephone: (630) 684-6438
Facsimile: (630) 684-6384 or 6385
72
<PAGE>
CONTINENTAL ASSURANCE COMPANY
Separate Account (E)
By: TCW Asset Management Company as
attorney-in-fact
By:____________________________
Name: Mark L. Gold
Title: Managing Director
By:____________________________
Name: Justin L. Driscoll
Title: Senior Vice President
Address for notices:
Continental Assurance Company
c/o TCW Asset Management Company
200 Park Avenue, Suite 2200
New York, NY 10166-0228
Attention: Mark L. Gold/Justin L. Driscoll
Telephone: (212) 297-4137
Facsimile: (212) 297-4159
73
<PAGE>
CANADIAN IMPERIAL BANK OF COMMERCE
By:_____________________________
Name:
Title:
Address for notices:
Canadian Imperial Bank of Commerce
425 Lexington Avenue, 7th Floor
New York, NY 10025
Attention: William Swenson
Telephone: (212) 856-3935
Facsimile: (212) 856-3799
74
<PAGE>
MORGAN STANLEY SENIOR FUNDING,
INC.
By:___________________________
Name:
Title:
Address for notices:
MORGAN STANLEY SENIOR FUNDING,
INC.
1585 Broadway, 10th Floor
New York, New York 10036
Attention: James Morgan
Telephone: (212) 761-4866
Facsimile: (212) 761-0592
75
<PAGE>
CRESCENT/MACH I PARTNERS, L.P.
by: TCW Asset Management Company,
its Investment Manager
By:______________________________
Name:
Title:
Address for notices:
Crescent/Mach I Partners L.P.
c/o State Street Bank & Trust Co.
Two International Place
Boston, MA 02110
Attention: Jackie Kilroy
Telephone: (617) 664-5477
Facsimile: (617) 664-5366
PLEASE COPY RATE SET NOTICE TO:
Mark L. Gold/Justin L. Driscoll
Trust Company of the West
200 Park Avenue
New York, NY 10166
Telephone: (212) 297-4137
Fax: (212) 297-4159
76
<PAGE>
NEW YORK LIFE INSURANCE COMPANY
By:____________________________
Name:
Title:
Address for notices:
New York Life Insurance and
Annuity Corporation
c/o New York Life Insurance Company
51 Madison Avenue
Room 206
New York, New York 10010
Attention: Charles Riceman
Telephone: (212) 576-4260
Facsimile: (212) 447-4122
77
<PAGE>
CITY NATIONAL BANK
By:___________________________
Name:
Title:
Address for notices:
City National Bank
400 N. Roxbury Drive, 3rd Floor
Beverly Hills, CA 90210
Attention: Randall Watsek
Telephone: 310/888-6114
Fax: 310/888-6152
78
<PAGE>
TORONTO-DOMINION BANK
By:_____________________
Address for notices:
The Toronto-Dominion Bank
31 West 52nd Street
New York, NY 10019
Attention: Jim McCarthy
Telephone: 212/468-6752
Fax: 212/974-0396
79
<PAGE>
LEHMAN COMMERCIAL PAPER INC.
By:__________________________
Address for notices:
Lehman Commercial Paper Inc.
3 World Financial Center
New York, NY 10285
Attention: Michele Swanson
Telephone: 212/526-0330
Fax: 212/528-0819
80
<PAGE>
CAPTIVA II FINANCE LTD.
By:________________________________
Address for notices:
Captiva II Finance Ltd.
c/o Deutsche Morgan Grenfell (Cayman) Limited
P.O. Box 1984GT, Elizabethan Square
Grand Cayman, Cayman Islands
Attention: Director
Telephone: (345) 949-8244
Facsimile: (345) 949-8178
with a copy to:
Stanfield Capital Partners
175 Water Street
New York, NY 10038
Attention: Christopher Jansen
Telephone: (212) 602-3650
Facsimile: (212) 602-3670
81
<PAGE>
CERES FINANCE LTD.
By:______________________________
Address for notices:
Ceres Finance Ltd.
c/o Deutsche Morgan Grenfell (Cayman) Limited
P.O. Box 1984GT, Elizabethan Square
Grand Cayman, Cayman Islands
Attention: Director
Telephone: (345) 949-8244
Facsimile: (345) 949-8178
with a copy to:
Stanfield Capital Partners
175 Water Street
New York, NY 10038
Attention: Christopher Jansen
Telephone: (212) 602-3650
Facsimile: (212) 602-3670
82
<PAGE>
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A., "RABOBANK
NEDERLAND", NEW YORK BRANCH
By:______________________________
Name:
Title:
By:______________________________
Name:
Title:
Address for notices:
Rabobank Nederland
245 Park Avenue
New York, NY 10167
Attention: M. Christina Debler
Telephone: (212) 916-7967
Facsimile: (212) 916-7837
83
<PAGE>
AMARA-2 FINANCE LTD.
By:______________________________
Name:
Title:
Address for notices:
Amara-2 Finance Ltd.
c/o Stanfield Capital Partners LLC
175 Water Street
New York, NY 10038
Attention: Christopher E. Janson
Telephone: (212) 602-3650
Facsimile: (212) 602-3670
84
<PAGE>
MLCBO IV (CAYMAN) LTD.
BY: HIGHLAND CAPITAL MANAGEMENT
L.P., as Collateral Manager
By:___________________________
Name:
Title:
Address for notices:
MLCBO IV (CAYMAN) LTD.
c/o Highland Capital Management L.P.,
as Collateral Manager
1150 Two Galleria Tower
13455 Noel Road, LB#45
Dallas, TX 75240
Attention: Mark Okada
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
85
<PAGE>
PAMCO CAYMAN LTD.
BY: HIGHLAND CAPITAL MANAGEMENT
L.P., as Collateral Manager
By:____________________________
Name:
Title:
Address for notices:
PAMCO CAYMAN LTD.
c/o Highland Capital Management L.P.,
as Collateral Manager
1150 Two Galleria Tower
13455 Noel Road, LB#45
Dallas, TX 75240
Attention: Mark Okada
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
86
<PAGE>
JACKSON NATIONAL LIFE INSURANCE
COMPANY
By: PPM America, Inc., as attorney-
in-fact, on behalf of Jackson National
Life Insurance Company
By:_______________________________
Name:
Title:
Address for notices:
PPM America, Inc.
225 W. Wacker, Suite 1200
Chicago, IL 60606
Attention: Michael DiRe
Telephone: (312) 634-2509
Facsimile: (312) 634-0054
87
<PAGE>
CYPRESSTREE INVESTMENT PARTNERS I.,
Ltd.
By: CypressTree Investment Management
Company, Inc., as Portfolio Manager
By:________________________________
Name:
Title:
Address for notices:
CypressTree Investment Partners I, Ltd.
125 High Street
Boston, MA 02110
Attention: John Fraser
Telephone: (617) 946-0600
Facsimile: (617) 946-5681
88
<PAGE>
INDOSUEZ CAPITAL FUNDING III, LIMITED
By: Indosuez Capital, as Portfolio Advisor
By:________________________________
Name:
Title:
Address for notices:
Indosuez Capital Funding III, Limited
1211 Avenue of the Americas, 7th Floor
New York, NY 10036-8701
Attention: Francoise Berthelot
Telephone: (212) 278-2213
Facsimile: (212) 278-2254
89
<PAGE>
THE ROYAL BANK OF SCOTLAND plc
By:__________________________
Name:
Title:
Address for notices:
The Royal Bank of Scotland plc
Wall Street Plaza
88 Pine Street, 26th Floor
New York, NY 10005
Attention: David Dougan
Telephone: (212) 269-0938
Facsimile: (212) 480-0791
90
<PAGE>
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By:_____________________________
Name:
Title:
Address for notices:
Merrill Lynch, Pierce, Fenner &
Smith Incorporated
250 Vesey Street
North Tower - 23rd Floor
New York, NY 10281-1316
Attention: Arlena Filipowicz
Telephone: (212) 449-8902
Facsimile: (212) 449-0188
91
<PAGE>
PAM CAPITAL FUNDING LP
BY: HIGHLAND CAPITAL MANAGEMENT
L.P., as Collateral Manager
By:_______________________________
Name:
Title:
Address for notices:
PAM Capital Funding LP
c/o Highland Capital Management L.P.
1150 Two Galleria Tower
13455 Noel Road, LB #45
Dallas, TX 75240
Attention: Mark Okada
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
92
<PAGE>
STEIN ROE & FARNHAM INCORPORATED
As Agent For
KEYPORT LIFE INSURANCE COMPANY
By:__________________________________
Name:
Title:
Address for notices:
Keyport Life Insurance Company
c/o Stein Roe & Farnham
One South Wacker Drive, 33rd Floor
Chicago, IL 60606
Attention: Brian W. Good
Telephone: (312) 368-7644
Facsimile: (312) 368-7857
93
<PAGE>
CHASE SECURITIES INC., as Agent
For The Chase Manhattan Bank, as Assignee
By:__________________________________
Name:
Title:
Address for notices:
Chase Securities, Inc.
270 Park Avenue, 4th Floor
New York, NY 10017
Attention: William Bokos
Telephone: (212) 270-5458
Facsimile: (212) 270-7968
94
<PAGE>
ALLIANCE CAPITAL MANAGEMENT L.P.,
As Manager on behalf of ALLIANCE CAPITAL
FUNDING, L.L.C.
By: ALLIANCE CAPITAL MANAGEMENT
CORPORATION, General Partner of Alliance
Capital Management L.P.
By:__________________________________
Name:
Title:
Address for notices:
Alliance Capital Funding, L.L.C.
Alliance Capital Management L.P.
1345 Avenue of the Americas, 38th Floor
New York, NY 10105
Attention: James Kennedy
Telephone: (212) 969-2497
Facsimile: (212) 969-2285
95
<PAGE>
ALLIANCE INVESTMENTS, LIMITED,
As Assignee
By:__________________________________
Name:
Title:
Address for notices:
Alliance Capital Management L.P.
1345 Avenue of the Americas
New York, NY 10105
Attention: Sheryl Rothman,
Alliance Investments, Ltd.
Telephone: (212) 969-2265
Facsimile: (212) 969-1554
96
<PAGE>
ML CLO XII PILGRIM AMERICA
(CAYMAN) LTD.
By: Pilgrim America Investments, Inc.
As its Investment Manager
By:__________________________________
Name:
Title:
Address for notices:
ML CLO XII PILGRIM AMERICA (CAYMAN)
LTD.
c/o Pilgrim America Investments, Inc.
Two Renaissance Square, Suite 1200
40 North Central Avenue
Phoenix, AZ 85004-3444
Attention: Melina Dempsey
Telephone: (602) 417-8268
Facsimile: (602) 417-8327
97
<PAGE>
ARM FINANCIAL GROUP, INC.
By:__________________________________
Name:
Title:
Address for notices:
ARM Financial Group, Inc.
515 W. Market Street
Louisville, KY 40202-3319
Attention: Trisha Pearl
Telephone: (502) 540-2855
Facsimile: (502) 582-7977
98
<PAGE>
LTCB TRUST COMPANY
By:__________________________________
Name:
Title:
Address for notices:
LTCB Trust Company
165 Broadway, 49th Floor
New York, NY 10006
Attention: Junichi Ebihara
Telephone: (212) 335-4477
Facsimile: (212) 608-2371
99
<PAGE>
KZH CRESCENT-2 LLC
By:____________________________
Name:
Title:
Address for notices:
KZH Crescent-2 LLC c/o
The Chase Manhattan
Bank 450 West 33rd
Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
100
<PAGE>
PROVIDENT BANK OF MARYLAND
By:__________________________________
Name:
Title:
Address for notices:
Provident Bank of Maryland
114 E. Lexington Street
Baltimore, MD 21202
Attention: Frieda McWilliams
Telephone: (410) 277-2086
Facsimile: (410) 277-2793
101
<PAGE>
GENERAL ELECTRIC CAPITAL
CORPORATION
By:__________________________________
Name:
Title:
Address for notices:
General Electric Capital Corporation
Commercial Finance
3379 Peachtree Road, N.E, Suite 560
Atlanta, GA 30326
Attention: Holly Kaczmarczyk
Telephone: (404) 814-2604
Facsimile: (404) 266-3538
102
<PAGE>
ABN AMRO BANK N.V.
By:__________________________________
Name:
Title:
Address for notices:
ABN AMRO BANK N.V.
135 South LaSalle Street, Suite 2805
Chicago, IL 60603
Attention: Credit Administration
Telephone: (312) 904-8835
Facsimile: (312) 904-8840
103
<PAGE>
DEUTSCHE BANK AG
NEW YORK BRANCH
a/o CAYMAN ISLANDS BRANCH
By:__________________________________
Name:
Title:
By:__________________________________
Name:
Title:
Address for notices:
Deutsche Bank AG
New York Branch
a/o Cayman Islands Branch
31 W. 52nd Street
New York, NY 10019
Attention: Sue Pearson
Telephone: (212) 469-7140
Facsimile: (212) 469-8701
104
<PAGE>
AMENDMENT NO. 3 AND WAIVER TO CREDIT AGREEMENT
(Multicare)
AMENDMENT NO. 3 AND WAIVER TO CREDIT AGREEMENT, dated as of
February 11, 1999, (this "Amendment No. 3") by and among: The Multicare
Companies, Inc. and certain Subsidiaries identified on the signature pages
hereto as "Borrowers"; the institutions identified on the signature pages hereto
as "Lenders"; Mellon Bank, N.A. as Issuer of Letters of Credit and as
Administrative Agent; Citicorp USA, Inc. as Syndication Agent; First Union
National Bank as Documentation Agent; and Bank of America (as successor by
merger to NationsBank, N.A.) as Syndication Agent.
Background
A Credit Agreement, dated as of October 9, 1997, was entered
into by and among The Multicare Companies, Inc. and certain of its Subsidiaries
as Borrowers, Mellon Bank, N.A. as Issuer of Letters of Credit and
Administrative Agent, Citicorp USA, Inc. as Syndication Agent, First Union
National Bank as Documentation Agent, NationsBank, N.A. as Syndication Agent,
and the Lenders and other Agents identified therein and was amended pursuant to
that certain Amendment No. 1 thereto, dated as of March 5, 1998 and was further
amended pursuant to that certain Amendment No. 2 thereto, dated as of August 28,
1998. The Credit Agreement, as so amended, is referred to herein as the "Current
Credit Agreement". The Current Credit Agreement, as the same may be amended,
modified, restated or supplemented from time to time is herein referred to as
the "Credit Agreement" or the "Agreement". Terms are used in this Amendment No.
3 as defined in the Current Credit Agreement unless otherwise specified.
The Borrowers have requested that the Adjusted Total Debt/Cash
Flow Ratio, the Adjusted Senior Debt/Cash Flow Ratio and the Fixed Charge
Coverage Ratio set forth in the Current Credit Agreement be modified for a
limited period and that the maximum amount of permitted rental payments in the
Current Credit Agreement be increased. The Lenders are willing to make such
changes to the Current Credit Agreement subject to the condition that the
Applicable Margin on LIBO Rate Loans be increased and subject to such other
terms and conditions as are more fully set forth below.
NOW THEREFORE, the parties hereto, intending to be legally
bound, hereby agree as follows.
Agreement
1
<PAGE>
1. Amendments to Current Credit Agreement on Amendment No. 3
Effective Date. The Current Credit Agreement is amended in each of the following
respects, as of the Amendment No. 3 Effective Date (as defined in Section 3
below).
1.1 Timing of Prepayments in Connection with Net Proceeds of
Dispositions. In order to provide for the prepayment of Loans with asset sale
proceeds promptly after the asset sale (rather than 364 days thereafter) and
eliminate the existing right to use proceeds of a disposition to effect an
acquisition, the first four sentences of paragraph (ii) of Section 1.5(b) are
deleted in their entirety and replaced with the following:
Promptly (but in no event more than ten Business Days) after
the date of any sale, assignment, transfer or other
disposition by any Borrower of any assets (other than pursuant
to paragraphs (a), (b), (c) or (e) of Section 8.5 below)
whether now owned or hereafter acquired (including a
disposition of equity, collectively, a "disposition"),
Multicare, on behalf of the Borrowers, shall prepay the Loans
by an amount equal to the amount of the Net Cash Proceeds of
such disposition. No more than five (5) Business Days before
any proposed disposition, Multicare, on behalf of the
applicable Borrower, shall notify the Administrative Agent in
writing (1) that such disposition is anticipated, (2) the
anticipated date of such disposition, (3) the anticipated date
of prepayment of the Loans pursuant to this paragraph (ii) and
(4) the amount of Net Cash Proceeds anticipated in connection
therewith. At least five (5) Business Days before the actual
prepayment, Multicare, on behalf of the Borrowers, shall
either confirm or correct the information provided in such
notice. Such confirmation or correction shall be deemed to be
an irrevocable notice of prepayment.
1.2 Adjusted Total Debt/Cash Flow Ratio. The covenant set
forth in Section 7.1(c) of the Current Credit Agreement is amended to provide
that, for the period commencing 10/1/98 and ending on 12/30/99, the Adjusted
Total Debt/Cash Flow Ratio shall be no greater than 7.25 to 1. At all other
times, the maximum permitted Adjusted Total Debt/Cash Flow Ratio shall be as set
forth in the Current Credit Agreement.
1.3 Adjusted Senior Debt/Cash Flow Ratio. The covenant set
forth in Section 7.1(d) of the Current Credit Agreement is amended to provide
that, for the period commencing 10/1/98 and ending on 12/30/99, the Adjusted
Senior Debt/Cash Flow Ratio shall be no greater than 5.25 to 1. At all other
times, the maximum permitted Adjusted Senior Debt/Cash Flow Ratio shall be as
set forth in the Current Credit Agreement.
1.4 Delivery of Status Letters. A new paragraph (l) shall be
added to Section 6.1 of the Current Credit Agreement immediately following
paragraph (k) thereof as follows:
On each of June 30, 1999 and September 30, 1999, Multicare, on
behalf of the Borrowers, shall deliver to the Administrative
Agent and each Lender a letter advising them of its plans and
the status of the implementation of those plans to cause an
event to occur or condition to exist which would result in
compliance with the required December 31, 1999 Adjusted Total
Debt/Cash Flow Ratio and required December 31, 1999 Adjusted
Senior Debt/Cash Flow Ratio.
2
<PAGE>
1.5 Adjustment to Permitted Rental Expense. In order to allow
the Borrowers to incur additional rental expense, clause (c) of Section 8.7 of
the Current Credit Agreement (Leases) is amended in its entirety to read as
follows:
(c) Other leases which are not Capitalized
Leased or Synthetic Leases but only to the extent that the
aggregate Rental Expense of the Surety and the Borrowers with
respect to all such other leases does not exceed (i) during
the fiscal year ending September 30, 1999, $25,000,000.00 and
(ii) during each fiscal year thereafter, an amount equal to
the amount permitted in the preceding year plus an additional
$2,000,000.00 (e.g., $27,000,000.00 in the fiscal year ending
September 30, 2000).
1.6 Applicable Margin Definition. In order to increase the
Applicable Margin on LIBO Rate Loans and add two additional pricing tiers, the
definition of Applicable Margin is amended in its entirety to read as follows:
"Applicable Margin" means a marginal rate of
interest which is added to the LIBO Rate or Prime Rate, as the
case may be, to determine the effective rate of interest on
Loans and other payments as specified in the Loan Documents.
Until the Officer's Compliance Certificate for the fiscal
quarter ending March 31, 1999 is delivered to the
Administrative Agent and Lenders pursuant to Section 6.1
above, the Applicable Margin (a) for LIBO Rate Loans shall be
the following: 3.0% for RC Loans or Tranche A Term Loans;
3.25% for Tranche B Term Loans; and 3.5% for Tranche C Term
Loans, and (b) for Prime Rate Loans shall be the following:
.75% for RC Loans and Tranche A Term Loans; 1.0% for Tranche B
Term Loans; and 1.25% for Tranche C Term Loans. Thereafter,
the Applicable Margin shall be determined in the following
manner:
(a) For any RC Loans or Tranche A Term
Loans, the Applicable Margin shall be the percentage amount
set forth below under the caption "Applicable Margin for RC
Loans and Tranche A Term Loans" opposite the relevant Adjusted
Total Debt/Cash Flow Ratio:
Adjusted Total Applicable Margin for RC Loans
Debt/Cash Flow Ratio and Tranche A Term Loans
-------------------- ---------------------------------
Prime Rate Loans LIBO Rate Loans
---------------- ---------------
below 3.0 0 1.00%
> 3.0 < 3.5 0 1.25%
-
> 3.5 < 4.0 0 1.50%
-
> 4.0 < 4.5 0 1.75%
-
> 4.5 < 5.0 0 2.00%
-
> 5.0 < 5.5 .25% 2.25%
-
> 5.5 < 6.0 .50% 2.50%
-
> 6.0 < 6.5 .75% 2.75%
-
>6.5 < 7.00 .75% 3.00%
-
>7.00 .75% 3.25%
-
3
<PAGE>
(b) For any Tranche B Term Loan, the
Applicable Margin at all times after the Amendment No. 3
Effective Date shall be 1.0% for Prime Rate Loans and 3.25%
for LIBO Rate Loans.
(c) For any Tranche C Term Loan, the
Applicable Margin at all times after the Amendment No. 3
Effective Date shall be 1.25% for Prime Rate Loans and 3.5%
for LIBO Rate Loans.
(d) The Applicable Margin for Swing Loans at
all times shall be zero.
The Applicable Margin shall be adjusted five Business Days
after receipt of the annual or quarterly Officer's Compliance
Certificate delivered pursuant to Section 6.1 and shall be
based on the Adjusted Total Debt/Cash Flow Ratio set forth
therein. At any time that such annual or quarterly Officer's
Compliance Certificate is required to be delivered pursuant to
said Section 6.1 and is not so delivered, then the Applicable
Margin shall be the highest rate specified for the subject
Loan until the Officer's Compliance Certificate is so
delivered.
1.7 Fixed Charge Coverage Ratio Definition. In order to
provide greater flexibility to the Borrowers for the period commencing on
October 1, 1998 and ending December 30, 1999, the definition of "Fixed Charge
Coverage Ratio" in Section 11.1 of the Existing Credit Agreement is amended by
adding the following two sentences at the end thereof:
Notwithstanding the foregoing, for calculations of the Fixed
Charge Coverage Ratio with respect to the period commencing
October 1, 1998 and ending December 30, 1999, there shall not
be added to the denominator "principal payments scheduled or
required to be made on Total Funded Indebtedness for the four
fiscal quarters ending on, or most recently prior to, such
date of determination". For calculations made with respect to
any period ending after December 30, 1999, the calculation
shall be made without regard to the adjustment set forth in
the preceding sentence.
4
<PAGE>
1.8 New Definition of Amendment No. 3 Effective Date. Section
11.1 of the Current Credit Agreement is amended by adding the following new
definition in its correct alphabetical location:
"Amendment No. 3 Effective Date" means the
date that Amendment No. 3 to this Agreement becomes effective
as more particularly set forth in said Amendment No. 3 hereto.
1.9 Amendment to Assignment Provisions. In order to allow
assignments by Lenders of smaller amounts, Section 12.9(c) of the Current Credit
Agreement is amended by replacing the phrase "Ten Million Dollars
($10,000,000.00)" in each of clauses (iii) and (iv) thereof with the phrase
"Five Million Dollars ($5,000,000.00)".
2. Representations and Warranties. In order to induce the Lenders,
the Issuer and the Agents to agree to amend the Current Credit Agreement, each
of the Borrowers, jointly and severally, makes the following representations and
warranties, which shall survive the execution and delivery of this Amendment No.
3.
(a) The execution, delivery and performance
of this Amendment No. 3 does not require any consent of,
notice to, or filing with any governmental entity or any other
third party, does not violate the terms of any agreement or
instrument binding on any Borrower (including, without
limitation, the constituent documents of such Borrower) or
violate any Law applicable to such Borrower. On and after the
Amendment No. 3 Effective Date, the Current Credit Agreement
as amended by the amendments hereunder to be effective on the
Amendment No. 3 Effective Date, shall be the legal, valid and
binding obligation of each Borrower enforceable against such
Borrower in accordance with its terms.
(b) No Default or Event of Default has
occurred and is continuing, after giving effect to the
amendments contained herein.
(c) Each of the representations and
warranties set forth in the Credit Agreement is true and
correct in all material respects both before and after giving
effect to the amendments and transactions contemplated hereby
as though each such representation and warranty were made at
and as of the date hereof and as of the Amendment No. 3
Effective Date.
3. Amendment No. 3 Effective Date; Waiver. The amendments set forth
in Section 1 (Amendments to Current Credit Agreement on Amendment No. 3
Effective Date) above shall be effective on the date (the "Amendment No. 3
Effective Date") that each of the following conditions is satisfied:
3.1 Execution of Amendment. Each of the Borrowers and the
Required Lenders shall have executed this Amendment No. 3 and the Surety shall
have executed the acknowledgement set forth below.
5
<PAGE>
3.2 Other Documents and Information. The Administrative Agent
shall have received such other documents and information as it shall reasonably
request.
Also effective on the Amendment No. 3 Effective Date, each Default or Event of
Default that would have existed had this Amendment No. 3 not become effective is
hereby waived to the extent and only to the extent that it does not exist or
would not exist after giving effect to this Amendment No. 3. This waiver is
limited in scope to its precise terms and does not imply any other or future
waivers.
4. Counterparts. This Amendment No. 3 may be executed in
counterparts and by different parties hereto in separate counterparts, each of
which, when executed and delivered, shall be deemed to be an original and all of
which, when taken together, shall constitute one and the same instrument. A
photocopied or facsimile signature shall be deemed to be the functional
equivalent of a manually executed original for all purposes.
5. Ratification. The Current Credit Agreement, as amended by this
Amendment No. 3, and the other Loan Documents, are, and shall continue to be, in
full force and effect and are hereby in all respects confirmed, approved and
ratified.
6. Payment of Fees and Expenses. Without limiting other payment
obligations of the Borrowers set forth in the Loan Documents, the Borrowers
hereby, jointly and severally, agree to pay (a) all costs and expenses incurred
by the Administrative Agent in connection with the preparation, execution and
delivery of this Amendment No. 3 and any other documents or instruments which
may be delivered in connection herewith, including, without limitation, the
reasonable fees and expenses of its counsel, Drinker Biddle & Reath LLP, (b) a
fee to each Lender who signs and returns a signature page hereto no later than
5:00 p.m. on February 11, 1999 in an amount equal to .2% of such Lender's total
Commitment under the Agreement and (c) such other fees as Multicare has agreed
to pay in connection herewith.
7. Authorization to Agent. The Lenders hereby authorize the
Administrative Agent to take such action (including, without limitation, signing
amendments to Loan Documents) as shall be consistent with the purposes hereof
and as it shall deem necessary or appropriate to carry out the purposes of this
Amendment No. 3.
8. Governing Law. This Amendment No. 3 shall be construed in
accordance with, and governed by, the laws of the Commonwealth of Pennsylvania,
without regard to choice of law principles.
9. References. From and after the Amendment No. 3 Effective Date,
each reference in the Credit Agreement to "this Agreement", "hereof",
"hereunder" or words of like import, and all references to the Credit Agreement
in any and all Loan Documents, other agreements, instruments, documents,
certificates and writings of every kind and nature, shall be deemed to mean the
Current Credit Agreement as modified and amended by this Amendment No. 3 and as
the same may be further amended, modified or supplemented in accordance with the
terms thereof.
6
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Amendment No. 3 to
be duly executed as of the date first above written.
BORROWERS:
THE MULTICARE COMPANIES, INC., a
Delaware corporation
By____________________________
Name: Barbara J. Hauswald
Title: Treasurer
Address for notices:
101 East State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Vice President
Chairman's Office & Corporate
Secretary
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
7
<PAGE>
ADS APPLE VALLEY LIMITED PARTNERSHIP, a Massachusetts limited partnership, by:
ADS Apple Valley, Inc. its General Partner
ADS DARTMOUTH GENERAL PARTNERSHIP, a Massachusetts general partnership, by ADS
Dartmouth ALF, Inc. and ADS Senior Housing, Inc., its General Partners
ADS HINGHAM LIMITED PARTNERSHIP, a Massachusetts limited partnership, by ADS
Hingham Nursing Facility, Inc., its General Partner
ADS RECUPERATIVE CENTER LIMITED PARTNERSHIP, a Massachusetts limited
partnership, by ADS Recuperative Center, Inc., its General Partner
CARE HAVEN ASSOCIATES LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
CUMBERLAND ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Cumberland, Inc., its General Partner
GLENMARK PROPERTIES I, LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc. and GMA Partnership Holding Company, Inc., its
General Partners
GROTON ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Groton, Inc., its General Partner
MIDDLETOWN (RI) ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited
partnership, by Health Resources of Middletown (R.I.), Inc., its General Partner
POINT PLEASANT HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership,
by Glenmark Associates, Inc., its General Partner
RALEIGH MANOR LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
ROMNEY HEALTH CARE CENTER LTD., LIMITED PARTNERSHIP, a West Virginia limited
partnership, by Glenmark Associates, Inc., its General Partner
SISTERVILLE HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
TEAYS VALLEY HAVEN LIMITED PARTNERSHIP, a West Virginia limited partnership, by
Glenmark Associates, Inc., its General Partner
THE STRAUS GROUP - HOPKINS HOUSE, L.P., a New Jersey limited partnership, by
Encare of Wyncote, Inc., its General Partner
THE STRAUS GROUP - QUAKERTOWN MANOR, L.P., a New Jersey limited partnership, by
Encare of Quakertown, Inc., its General Partner
WALLINGFORD ASSOCIATES OF CONNECTICUT, L.P., a Delaware limited partnership, by
Health Resources of Wallingford, Inc., its General Partner
8
<PAGE>
WARWICK ASSOCIATES OF RHODE ISLAND, L.P., a Delaware limited partnership, by
Health Resources of Warwick, Inc., its General Partner
By: ___________________________________
On behalf of each of the foregoing
General Partners by Barbara J. Hauswald,
Treasurer
HOLLY MANOR ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Encare of Mendham, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
MERCERVILLE ASSOCIATES OF NEW JERSEY, L.P., a Delaware limited partnership, by
Breyut Convalescent Center, L.L.C., its General Partner, by Century Care
Management, Inc., its authorized manager
POMPTON ASSOCIATES, L.P., a New Jersey limited partnership, by Pompton Corp.,
L.L.C., its General Partner, by Century Care Management, Inc., its authorized
manager
THE STRAUS GROUP - OLD BRIDGE, L.P., a New Jersey limited partnership, by Health
Resources of Emery, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
THE STRAUS GROUP - RIDGEWOOD, L.P., a New Jersey limited partnership, by Health
Resources of Ridgewood, L.L.C., its General Partner, by Century Care Management,
Inc., its authorized manager
By:__________________________
On behalf of each of the foregoing
General Partners by Barbara J.
Hauswald as Treasurer of the
Authorized Manager
Address for notices:
101 East State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Vice President
Chairman's Office & Corporate
Secretary
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
9
<PAGE>
ACADEMY NURSING HOME, INC., a Massachusetts corporation
ADS APPLE VALLEY, INC., a Massachusetts corporation
ADS CONSULTING, INC., a Massachusetts corporation
ADS DANVERS ALF, INC., a Delaware corporation
ADS DARTMOUTH ALF, INC., a Delaware corporation
ADS HINGHAM ALF, INC., a Delaware Corporation
ADS HINGHAM NURSING FACILITY, INC., a Massachusetts corporation
ADS HOME HEALTH, INC., a Delaware corporation
ADS MANAGEMENT, INC., a Massachusetts corporation
ADS/MULTICARE, INC., a Delaware corporation
ADS RECUPERATIVE CENTER, INC., a Massachusetts corporation
ADS SENIOR HOUSING, INC., a Massachusetts corporation
ADS VILLAGE MANOR, INC., a Massachusetts corporation
ANR, INC., a Delaware corporation
APPLEWOOD HEALTH RESOURCES, INC., a Delaware corporation
AUTOMATED PROFESSIONAL ACCOUNTS, INC., a West Virginia corporation
BERKS NURSING HOMES, INC., a Pennsylvania corporation
BETHEL HEALTH RESOURCES, INC., a Delaware corporation
BRIGHTWOOD PROPERTY, INC., a West Virginia corporation
CENTURY CARE CONSTRUCTION, INC., a New Jersey corporation
CENTURY CARE MANAGEMENT, INC., a Delaware corporation
CHATEAU VILLAGE HEALTH RESOURCES, INC., a Delaware corporation
CHG INVESTMENT CORP., INC., a Delaware corporation
CHNR-I, INC., a Delaware corporation
COLONIAL HALL HEALTH RESOURCES, INC., a Delaware corporation
COLONIAL HOUSE HEALTH RESOURCES, INC., a Delaware corporation
CONCORD HEALTH GROUP, INC., a Delaware corporation
CONCORD HOME HEALTH, INC., a Pennsylvania corporation
CONCORD REHAB, INC., a Pennsylvania corporation
CONCORD SERVICE CORPORATION, a Pennsylvania corporation
10
<PAGE>
CVNR, INC., a Delaware corporation
DELM NURSING, INC., a Pennsylvania corporation
ELMWOOD HEALTH RESOURCES, INC., a Delaware corporation
ENCARE OF PENNYPACK, INC., a Pennsylvania corporation
ENCARE OF QUAKERTOWN, INC., a Pennsylvania corporation
ENCARE OF WYNCOTE, INC., a Pennsylvania corporation
ENR, INC., a Delaware corporation
GLENMARK ASSOCIATES, INC., a West Virginia corporation
GMA - BRIGHTWOOD, INC., a West Virginia corporation
GMA CONSTRUCTION, INC., a West Virginia corporation
GMA - MADISON, INC., a West Virginia corporation
GMA PARTNERSHIP HOLDING COMPANY, INC., a West Virginia corporation
GMA - UNIONTOWN, INC., a Pennsylvania corporation
HEALTH RESOURCES OF BOARDMAN, INC., a Delaware corporation
HEALTH RESOURCES OF CEDAR GROVE, INC., a New Jersey corporation
HEALTH RESOURCES OF COLCHESTER, INC., a Connecticut corporation
HEALTH RESOURCES OF COLUMBUS, INC., a Delaware corporation
HEALTH RESOURCES OF CUMBERLAND, INC., a Delaware corporation
HEALTH RESOURCES OF EATONTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF FARMINGTON, INC., a Delaware corporation
HEALTH RESOURCES OF GARDNER, INC., a Delaware corporation
HEALTH RESOURCES OF GLASTONBURY, INC., a Connecticut corporation
HEALTH RESOURCES OF GROTON, INC., a Delaware corporation
HEALTH RESOURCES OF LAKEVIEW, INC., a New Jersey corporation
HEALTH RESOURCES OF LEMONT, INC., a Delaware corporation
HEALTH RESOURCES OF LYNN, INC., a New Jersey corporation
HEALTH RESOURCES OF KARMENTA AND MADISON, INC., a Delaware corporation
HEALTH RESOURCES OF MARCELLA, INC., a Delaware corporation
HEALTH RESOURCES OF MIDDLETOWN (R.I.), INC., a Delaware corporation
11
<PAGE>
HEALTH RESOURCES OF MORRISTOWN, INC., a New Jersey corporation
HEALTH RESOURCES OF NORFOLK, INC., a Delaware corporation
HEALTH RESOURCES OF NORWALK, INC., a Connecticut corporation
HEALTH RESOURCES OF PENNINGTON, INC., a New Jersey corporation
HEALTH RESOURCES OF ROCKVILLE, INC., a Delaware corporation
HEALTH RESOURCES OF SOUTH BRUNSWICK, INC., a New Jersey corporation
HEALTH RESOURCES OF TROY HILLS, INC., a New Jersey corporation
HEALTH RESOURCES OF WALLINGFORD, INC., a Delaware corporation
HEALTH RESOURCES OF WARWICK, INC., a Delaware corporation
HEALTHCARE REHAB SYSTEMS, INC., a Pennsylvania corporation
HORIZON ASSOCIATES, INC., a West Virginia corporation
HORIZON MOBILE, INC., a West Virginia corporation
HORIZON REHABILITATION, INC., a West Virginia corporation
HR OF CHARLESTON, INC., a West Virginia corporation
HRWV Huntington, Inc., a West Virginia corporation
LAKEWOOD HEALTH RESOURCES, INC., a Delaware corporation
LAUREL HEALTH RESOURCES, INC., a Delaware corporation
LEHIGH NURSING HOMES, INC., a Pennsylvania corporation
LWNR, INC., a Delaware corporation
MABRI CONVALESCENT CENTER, INC., a Connecticut corporation
MARKGLEN, INC., a West Virginia corporation
MARSHFIELD HEALTH RESOURCES, INC., a Delaware corporation
MONTGOMERY NURSING HOMES, INC., a Pennsylvania corporation
MULTICARE AMC, INC., a Delaware Corporation
MULTICARE HOME HEALTH OF ILLINOIS, INC., a Delaware corporation
NURSING AND RETIREMENT CENTER OF THE ANDOVERS, INC., a Massachusetts corporation
PHC OPERATING CORP., a Delaware corporation
POCAHONTAS CONTINUOUS CARE CENTER, INC., a West Virginia corporation
PRESCOTT NURSING HOME, INC., a Massachusetts corporation
12
<PAGE>
PROGRESSIVE REHABILITATION CENTERS, INC., a Delaware corporation
PROVIDENCE HEALTH CARE, INC., a Delaware corporation
REST HAVEN NURSING HOME, INC, a West Virginia corporation
RIDGELAND HEALTH RESOURCES, INC., a Delaware corporation
RIVER PINES HEALTH RESOURCES, INC., a Delaware corporation
RIVERSHORES HEALTH RESOURCES, INC., a Delaware corporation
RLNR, INC., a Delaware corporation
ROSE HEALTHCARE, INC., a New Jersey corporation
ROSE VIEW MANOR, INC., a Pennsylvania corporation
RSNR, INC., a Delaware corporation
RVNR, INC., a Delaware corporation
SENIOR LIVING VENTURES, INC., a Pennsylvania corporation
SCHUYLKILL NURSING HOMES, INC., a Pennsylvania corporation
SCHUYLKILL PARTNERSHIP ACQUISITION CORP., a Pennsylvania corporation
SENIOR SOURCE, INC., a Massachusetts corporation
SNOW VALLEY HEALTH RESOURCES, INC., a Delaware corporation
SOLOMONT FAMILY FALL RIVER VENTURE, INC., a Massachusetts corporation
SOLOMONT FAMILY MEDFORD VENTURE, INC., a Massachusetts corporation
STAFFORD CONVALESCENT CENTER, INC., a Delaware corporation
S.T.B. INVESTORS, LTD., a New York corporation
SVNR, INC., a Delaware corporation
THE ADS GROUP, INC., a Massachusetts corporation
TRI-STATE MOBILE MEDICAL SERVICES, INC., a West Virginia corporation
WESTFORD NURSING AND RETIREMENT CENTER, INC., a Massachusetts corporation
13
<PAGE>
WILLOW MANOR NURSING HOME, INC., a Massachusetts corporation
By:______________________________
Barbara J. Hauswald as Treasurer on
behalf of each of the foregoing
Address for notices:
101 East State Street
Kennett Square, PA 19348
Attention: Ira C. Gubernick, Vice President
Chairman's Office & Corporate
Secretary
Telephone: (610) 444-6350
Facsimile: (610) 444-3365
14
<PAGE>
BREYUT CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
ENCARE OF MENDHAM, L.L.C., a New Jersey limited liability company, by Century
Care Management, Inc., its authorized manager
HEALTH RESOURCES OF BRIDGETON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CINNAMINSON, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF CRANBURY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EMERY, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF ENGLEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF EWING, L.L.C., a New Jersey limited liability company. by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF FAIR LAWN, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF JACKSON, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF RIDGEWOOD, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
HEALTH RESOURCES OF WEST ORANGE, L.L.C., a New Jersey limited liability company,
by Century Care Management, Inc., its authorized manager
POMPTON CARE, L.L.C., a New Jersey limited liability company, by Century Care
Management, Inc., its authorized manager
ROEPHEL CONVALESCENT CENTER, L.L.C., a New Jersey limited liability company, by
Century Care Management, Inc., its authorized manager
By:______________________________
On behalf of each of the foregoing Authorized
Managers by its Treasurer
15
<PAGE>
The foregoing Amendment No. 3
is acknowledged and agreed to
by the undersigned Surety (whether
in its capacity as Surety, pledgor
under the Pledge Agreement or
otherwise) as of the date
first above written.
GENESIS ELDERCARE CORP.
By:______________________
Name: Barbara J. Hauswald
Title: Treasurer
16
<PAGE>
AGENTS, ISSUER AND LENDERS:
MELLON BANK, N.A., as a Lender,
as Issuer and as Administrative Agent
By________________________________
Name: Michael J. Fox
Title: Vice President
Address for notices:
street address:
AIM 199-5220
Mellon Independence Center
701 Market Street
Philadelphia, Pennsylvania 19106
mailing address:
AIM 199-5220
P.O. Box 7899
Philadelphia, Pennsylvania 19101-7899
Attention: Linda Sigler,
Loan Administration
Telephone: 215-553-4583
Facsimile: 215-553-4789
17
<PAGE>
With a copy to
Plymouth Meeting Executive Campus
610 W. Germantown Pike, Suite 200
Plymouth Meeting, Pennsylvania 19462
Attention: Michael Fox
Vice President
Telephone: 610-941-8426
Facsimile: 610-941-4136
With a copy for notices respecting assignments to:
MELLON BANK, N.A.
One Mellon Bank Center
45th Floor
Pittsburgh, PA 15258-0001
Attention: Dean Hazelton
Telephone: 412-236-0316
Facsimile: 412-236-9176
18
<PAGE>
CITICORP USA, INC., as a Lender and as Syndication
Agent
By________________________________
Name:
Title:
Address for notices:
399 Park Avenue
8th Floor, Zone 6
New York, NY 10043
Attention: Margaret A. Brown
Telephone: 212-559-0501
Facsimile: 212-793-0289
19
<PAGE>
FIRST UNION NATIONAL BANK, as a Lender and as
Documentation Agent
By________________________________
Name:
Title:
FIRST UNION NATIONAL BANK (as
successor to CORESTATES BANK, N.A.)
By________________________________
Name:
Title:
Address for notices:
One First Union Center TW-5
Charlotte, NC 28288-0735
Attention: Marijane Boyle
Telephone: 704-383-0624
Facsimile: 704-383-9144
20
<PAGE>
NATIONSBANK, N.A., as a Lender and as a
Syndication Agent
By_______________________________
Name:
Title:
Address for notices:
101 North Tryon Street
15th Floor Charlotte,
NC 28255 NC1-001-15-11
Attention: Matthew Menz
Telephone: 704-388-1111
Facsimile: 704-409-0083
With a copy to
100 North Tryon Street
17th Floor Charlotte,
NC 28255 NC1-007-1711
Attention: Ms. Marty Mitchell
Telephone: 704-388-1115
Facsimile: 704-386-1270
e-mail: [email protected]
21
<PAGE>
CREDIT LYONNAIS NEW YORK BRANCH
By:_______________________________
Name:
Title:
Address for notices:
Credit Lyonnaise New York Branch
1301 Avenue of the Americas
New York, NY 10019
Attention: John C. Oberle
Telephone: (212) 261-7344
Facsimile: (212) 261-3440
22
<PAGE>
FLEET NATIONAL BANK
By:_________________________
Name:
Title:
Address for notices:
Fleet National Bank
One Federal Street
MA OF D07B
Boston, MA 02110
Attention: Carol Paige
Telephone: (617) 346-4619
Facsimile: (617) 346-4699
23
<PAGE>
THE INDUSTRIAL BANK OF JAPAN,
LIMITED
By:__________________________________
Name:
Title:
Address for notices:
The Industrial Bank of Japan, Limited
1251 Avenue of the Americas
New York, NY 10020
Attention: Randall Wernes
Telephone: (212) 282-3461
Facsimile: (212) 282-4488
24
<PAGE>
NATIONAL WESTMINSTER BANK Plc
By:____________________________
Name:
Title:
Address for notices:
National Westminster Bank Plc
65 East 55th Street, 21st Floor
New York, NY 10022
Attention: Andrew Weinberg
Phone: (212) 418-4567
Facsimile: (212) 418-4594
with a copy to:
Gleacher NatWest Inc.
660 Madison Avenue, 14th Floor
New York, NY 10021
Attention: Andrew Weinberg
Telephone: (212) 418-4567
Facsimile: (212) 418-4594
25
<PAGE>
THE SAKURA BANK, LIMITED
By:_____________________________
Name:
Title:
Address for notices:
The Sakura Bank, Limited
277 Park Avenue, 45th Floor
New York, NY 10172
Attention: Yoshikazu Nagura
Telephone: (212) 909-4549
Facsimile: (212) 909-4599
26
<PAGE>
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By:_______________________________
Name:
Title:
Address for notices:
Bank of America National Trust
& Savings Associations
100 North Tryon Street, 17th Floor
Charlotte, NC 28255
Attention: Michael Andry
Telephone: (704) 388-8878
Facsimile: (704) 386-3893
With copies to
NationsBank, N.A.
101 North Tryon Street, 15th Floor
Charlotte, NC 28255
NC1-001-15-11
Attention: Matthew Menz
Telephone: 704-388-1111
Facsimile: 704-409-0083
and
NationsBank, N.A.
100 North Tryon Street, 17th Floor
Charlotte, NC 28255
NC1-007-1711
Attention: Ms. Marty Mitchell
Telephone: 704-388-1115
Facsimile: 704-388-6002
e-mail: [email protected]
27
<PAGE>
PARIBAS
By:__________________________
Name:
Title:
By:__________________________
Name:
Title:
Address for notices:
Paribas
787 Seventh Avenue
New York, NY 10019
Attention: Tod Majidzadeh
Telephone: (212) 841-2931
Facsimile: (212) 841-2292
28
<PAGE>
BANKBOSTON, N.A.
By:___________________________
Name:
Title:
Address for notices:
BankBoston, N.A.
100 Federal Street, 01-08-06
Boston, MA 02110
Attention: William R. Rogers
Telephone: (617) 434-6247
Facsimile: (617) 434-0819
29
<PAGE>
THE BANK OF NEW YORK
By:___________________________
Name:
Title:
Address for notices:
The Bank of New York
One Wall Street, 21st Floor
New York, NY 10286
Attention: Peter Abdill
Telephone: (212) 635-8020
Facsimile: (212) 635-8092
30
<PAGE>
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By:___________________________
Name:
Title:
Address for notices:
Bank of Tokyo-Mitsubishi Trust Company
1251 Avenue of the Americas, 12th Floor
New York, NY 10020-1104
Attention: Douglas Weir
Telephone: (212) 782-4503
Facsimile: (212) 782-4935
31
<PAGE>
CRESTAR BANK
By:___________________________________
Name:
Title:
Address for Notices:
Crestar Bank
120 E. Baltimore Street, 25th Floor
Baltimore, MD 21202
Attention: Andrea Robinson
Telephone: (410) 986-1686
Facsimile: (410) 986-1012
32
<PAGE>
DRESDNER BANK AG, NEW YORK
BRANCH AND GRAND CAYMAN BRANCH
By:__________________________
Name:
Title:
By:__________________________
Name:
Title:
Address for notices:
Dresdner Bank AG, New York
75 Wall Street, 25th Floor
New York, NY 10005-2889
Attention: Felix K. Camacho
Telephone: (212) 429-3007
Facsimile: (212) 429-2129
33
<PAGE>
FINOVA CAPITAL CORPORATION
By:_________________________
Name:
Title:
Address for notices:
Finova Capital Corporation
311 S. Wacker, Suite 4400
Chicago, IL 60606
Attention: Brian Williamson
Telephone: (312) 294-4175
Facsimile: (312) 322-3553
34
<PAGE>
KEY CORPORATE CAPITAL INC.
By:__________________________
Name:
Title:
Address for notices:
Key Corporate Capital Inc.
c/o Key Bank, N.A.
127 Public Square
Cleveland, OH 44114
Attention: Angela Mago
OH-01-27-0605
Telephone: (216) 689-3247
Facsimile: (216) 689-5970
35
<PAGE>
FIRST NATIONAL BANK OF MARYLAND
By:____________________________
Name:
Title:
Address for notices:
First National Bank of Maryland
25 S. Charles Street, 18th Floor
Baltimore, MD 21201
Attention: Robert H. Hauver
Telephone: (410) 244-4246
Facsimile: (410) 244-4388
36
<PAGE>
NATEXIS BANQUE BFCE
By:__________________________
Name:
Title:
By:__________________________
Name:
Title:
Address for notices:
Natexis Banque BFCE
645 Fifth Avenue, 20th Floor
New York, NY 10022
Attention: Frank Madden
Telephone: (212) 872-5180
Facsimile: (212) 872-5045
37
<PAGE>
NATIONAL CITY BANK OF
PENNSYLVANIA
By:_______________________________
Name:
Title:
Address for notices:
National City Bank of Pennsylvania
20 Stanwix Street, 46-25-191
Pittsburgh, PA 15222
Loc. 46-25-191
Attention: Debra W. Riefner
Telephone: (412) 644-8880
Facsimile: (412) 471-4883
38
<PAGE>
THE SANWA BANK, LIMITED
By:___________________________
Name:
Title:
Address for notices:
The Sanwa Bank, Limited
55 E. 52nd Street
New York, NY 10055
Attention: Jean-Michel Fatovic
Telephone: (212) 339-6397
Facsimile: (212) 754-1304
39
<PAGE>
SUMMIT BANK
By:____________________________________
Name: James P. Andersen
Title: Vice President and Regional
Manager
Address for notices:
Summit Bank
250 Moore Street, 2nd Floor
Hackensack, NJ 07601
Attention: Tom Hanrahan
Telephone: (201) 646-5859
Facsimile: (201) 646-9497
40
<PAGE>
THE DAI-ICHI KANGYO BANK, LTD.
By:________________________________
Name:
Title:
Address for notices:
The Dai-Ichi Kangyo Bank, Ltd.
One World Trade Center, 48th Floor
New York, NY 10048
Attention: Takayuki Kumagai
Telephone: (212) 432-6651
Facsimile: (212) 488-8955
41
<PAGE>
BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
Address for notices:
Bank Austria Creditanstalt Corporate
Finance, Inc.
Two Greenwich Plaza
Greenwich, CT 06830
Attention: Cliff Wells
Telephone: (203) 861-6417
Facsimile: (203) 861-0297
42
<PAGE>
CREDIT SUISSE FIRST BOSTON
By:_____________________________
Name:
Title:
By:_____________________________
Name:
Title:
Address for notices:
Credit Suisse First Boston
11 Madison Avenue
New York, NY 10010
Attention: William S. Lutkins
Telephone: (212) 325-9705
Facsimile: (212) 325-8319
43
<PAGE>
FIRST NATIONAL BANK OF CHICAGO
By:_____________________________
Name:
Title:
Address for notices:
First National Bank of Chicago
1 First National Plaza
Chicago, IL 60670
Attention: Patricia Carpen
Telephone: (312) 732-1418
Facsimile: (312) 732-2016
44
<PAGE>
SCOTIABANC, INC.
By:____________________________
Name:
Title:
Address for notices:
ScotiaBanc, Inc.
600 Peachtree Street NE
Suite 2700
Atlanta, GA 30308
Attention: Dana Maloney
Telephone: (404) 877-1524
Facsimile: (404) 888-8998
45
<PAGE>
CIBC INC.
By:_______________________________
Name:
Title:
Address for notices:
CIBC Inc.
425 Lexington Avenue, 8th Floor
New York, NY 10025
Attention: Judith Kirshner
Telephone: (212) 856-3547
Facsimile: (212) 856-3991
46
<PAGE>
AMSOUTH BANK
By:__________________________
Name:
Title:
Address for notices:
AmSouth Bank
1900 5th Ave. N. AST7FL
Birmingham, AL 35203
Attention: Ken DiFatta
Telephone: (205) 801-0358
Facsimile: (205) 326-4790
47
<PAGE>
PFL LIFE INSURANCE
COMPANY
By:_______________________________
Name:
Title:
Address for notices:
PFL Life Insurance Company
c/o Aegon USA Investment Management, Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Attention: John Bailey, Securities Analyst
Telephone: (319) 369-2811
Facsimile: (319) 369-2666
48
<PAGE>
MONUMENTAL LIFE INSURANCE
COMPANY (successor by merger to
PEOPLES SECURITY LIFE INSURANCE
COMPANY)
By:___________________________
Name:
Title:
Address for notices:
Monumental Life Insurance Company
c/o Aegon USA Investment Management, Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Attention: John Bailey, Securities Analyst
Telephone: (319) 369-2811
Facsimile: (319) 369-2666
Payment Advice
Attention: Marla Johnson
Monumental Life Insurance Company
c/o AEGON USA Investment Management,
Inc.
4333 Edgewood Road, NE
Cedar Rapids, IA 52499
Fax Number: (319) 398-8695
49
<PAGE>
FLOATING RATE PORTFOLIO
By: INVESCO Senior Secured
Management, Inc., as attorney in fact
By:________________________________
Address for notices:
Floating Rate Portfolio
c/o INVESCO Senior Secured
Management, Inc.
1166 Avenue of the Americas, 27th Floor
New York, NY 10036
Attention: Kathleen Lenarcic
Telephone: (212) 278-9794
Facsimile: (212) 278-9619
50
<PAGE>
MORGAN STANLEY DEAN WITTER
PRIME INCOME TRUST
By:________________________________
Name:
Title:
Address for notices:
Morgan Stanley Dean Witter
Prime Income Trust
c/o Morgan Stanley Dean Witter Advisors
72nd Floor
Two World Trade Center
New York, NY 10048
Attention: Kevin Egan
Telephone: (212) 392-5845
Facsimile: (212) 392-5345
51
<PAGE>
DEEPROCK & COMPANY
By: Eaton Vance Management
as Investment Advisor
By:______________________________
Name:
Title:
Address for notices:
State Street Bank & Trust Company
Corporate Trust Division
One Enterprise Drive
North Quincy, MA 02171
Attention: Patrick McEnroe
Telephone: (617) 664-5367
Facsimile: (617) 664-5366
Eaton Vance Management
Attention: Prime Rate Reserves
24 Federal Street, 6th Floor
Boston, MA 02110
Attention: Payson Swaffield
Telephone: (617) 654-8484
Telecopier: (617) 695-9594
Reference:
52
<PAGE>
ING HIGH INCOME PRINCIPAL
PRESERVATION FUND HOLDINGS, LDC
By: ING Capital Advisors, Inc.,
As Investment Advisor
By:_________________________________
Name:
Title:
Address for notices:
ING High Income Principal Preservation
Fund Holdings, LDC
c/o ING Capital Advisors, Inc.
233 S. Wacker Drive #5200
Chicago, IL 60606
Attention: Jane Musser Nelson
Telephone: (312) 496-7606
Facsimile: (312) 496-7611
53
<PAGE>
SENIOR DEBT PORTFOLIO
BY: Boston Management and Research
as Investment Advisor
By:______________________________
Name:
Title:
Address for notices:
Eaton Vance Management
Attention: Prime Rate Services
24 Federal Street, 6th Floor
Boston, MA 02110
Attention: Payson Swaffield
Telephone: (617) 654-8484
Facsimile: (617) 695-9594
54
<PAGE>
MASSACHUSETTS MUTUAL LIFE
INSURANCE CO.
By:______________________________
Name:
Title:
Address for notices:
Massachusetts Mutual Life Insurance Co.
1295 State Street
Springfield, MA 01111
Attention: John Wheeler, Managing Director
Telephone: (413) 744-6228
Facsimile: (413) 744-2022
55
<PAGE>
MERRILL LYNCH SENIOR FLOATING
RATE FUND, INC.
By:_______________________________
Name:
Title:
MERRILL LYNCH PRIME RATE
PORTFOLIO
By: Merrill Lynch Asset Management,
L.P., as Investment Advisor
By:_______________________________
Name:
Title:
Address for notices:
Merrill Lynch Senior Floating Rate Fund, Inc.
c/o Merrill Lynch Asset Management
800 Scudders Mill Road - Area 1B
Plainsboro, NJ 08536
Attention: Colleen Cunniffe
Telephone: (609) 282-2093
Facsimile: (609) 282-2756
56
<PAGE>
MERRILL LYNCH GLOBAL INVESTMENT SERIES
Income Strategies Portfolio
By: Merrill Lynch Asset Management, L.P., as
Investment Advisor
As assignee
By:_______________________________
Name:
Title:
Address for notices:
Merrill Lynch Global Investment Series
c/o Merrill Lynch Asset Management, L.P.
800 Scudders Mill Road - Area 1B
Plainsboro, NJ 08536
Attention: Colleen Cunniffe
Telephone: (609) 282-2093
Facsimile: (609) 282-2756
57
<PAGE>
METROPOLITAN LIFE INSURANCE
COMPANY
By:_____________________________
Name:
Title:
Address for notices:
Metropolitan Life Insurance Company
334 Madison Avenue
Convent Station, NJ 07961-0633
Attention: James Dingler
Asst. Vice President
Telephone: (973) 254-3206
Facsimile: (973) 254-3050
58
<PAGE>
THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY
By:________________________________
Name:
Title: Its Authorized Representative
Address for notices:
The Northwestern Mutual Life Insurance
Company
720 E. Wisconsin Avenue
Milwaukee, WI 53202
Attention: David A. Barras
Director-Investments
Northwestern Investment Management
Company
Telephone: (414) 299-1618
Facsimile: (414) 299-7124
59
<PAGE>
NEW YORK LIFE INSURANCE
AND ANNUITY CORPORATION
By: New York Life Insurance Company
By:______________________________
Name:
Title:
Address for notices:
New York Life Insurance and Annuity
Corporation
c/o New York Life Insurance Company
51 Madison Avenue, Room 206
New York, NY 10010
Attention: Adam Clemens
Telephone: (212) 576-7238
Facsimile: (212) 447-4122
60
<PAGE>
OAK HILL SECURITIES FUND, L.P.
By: Oak Hill Securities GenPar, L.P.,
Its General Partner
By: Oak Hill Securities MGP, Inc.,
Its General Partner
By:_______________________________
Name:
Title:
Address for notices:
Oak Hill Securities Fund, L.P.
c/o O'Sullivan Graev & Karabell, LLP
30 Rockefeller Plaza
New York, NY 10112
Attention: John Ashmead, Esq.
Telephone: (212) 408-2494
Facsimile: (212) 728-5950
61
<PAGE>
OCTAGON LOAN TRUST
By:____________________________
Name:
Title:
Address for notices:
Octagon Loan Trust
380 Madison Avenue, 12th Floor
New York, NY 10017
Attention: James P. Ferguson
Managing Director
Telephone: (212) 622-3070
Facsimile: (212) 622-3797
62
<PAGE>
PARIBAS CAPITAL FUNDING LLC
By:____________________________
Name:
Title:
Address for notices:
Paribas Capital Funding LLC
787 Seventh Avenue, 32nd Floor
New York, NY 10019
Attention: Michael Weinberg
Telephone: (212) 841-2544
Facsimile: (212) 841-2144
with a copy to:
State Street Bank & Trust Co.
Corporate Trust Dept.
Attn: Bill Connolly
Phone: (617) 664-5410
Fax: (617) 664-5366(67)(68)
63
<PAGE>
ROYALTON COMPANY
By: Pacific Investment Management
Company, as its Investment Advisor
By:_____________________________
Name:
Title:
Address for notices:
Royalton Company
c/o Pacific Investment Management Co.
840 Newport Center Drive
Newport Beach, CA 92658
Attention: Melissa Fejdasz
Telephone: (949) 721-5169
Facsimile: (949) 718-2623
64
<PAGE>
NORTHERN LIFE INSURANCE
COMPANY
By: ____________________________
Name:
Title:
Address for notices:
Northern Life Insurance Company
c/o Reliastar Investment Research, Inc.
100 Washington Avenue South, Suite 800
Minneapolis, MN 55401-2121
Attention: James V. Wittich
Telephone: (612) 372-3553
Facsimile: (612) 372-5368
65
<PAGE>
KZH SOLEIL LLC
By:________________________________
Name:
Title:
Address for notices:
KZH Soleil LLC
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
66
<PAGE>
KZH III LLC
By:_____________________________
Name:
Title:
Address for notices:
KZH III LLC c/o The
Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
67
<PAGE>
KZH CRESCENT LLC
By:_____________________________
Name:
Title:
Address for notices:
KZH Crescent LLC
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
68
<PAGE>
VAN KAMPEN PRIME RATE INCOME
TRUST
By:__________________________
Name:
Title:
VAN KAMPEN CLO I, LIMITED
by: Van Kampen Management, Inc., as
Collateral Manager
By:__________________________
Name:
Title:
VAN KAMPEN SENIOR INCOME TRUST
By:__________________________
Name:
Title:
Address for notices:
In care of:
Van Kampen
One Parkview Plaza
Oakbrook Terrace, IL 60181
Attention: Jeffrey Maillet
Telephone: (630) 684-6438
Facsimile: (630) 684-6740
69
<PAGE>
CONTINENTAL ASSURANCE COMPANY
Separate Account (E)
By: TCW Asset Management Company as
attorney-in-fact
By:_______________________________
Name: Mark L. Gold
Title: Managing Director
By:_______________________________
Name: Justin L. Driscoll
Title: Senior Vice President
Address for notices:
Continental Assurance Company
c/o TCW Asset Management Company
200 Park Avenue, Suite 2200
New York, NY 10166-0228
Attention: Mark L. Gold/Justin L. Driscoll
Telephone: (212) 771-4137
Facsimile: (212) 771-4159
70
<PAGE>
CANADIAN IMPERIAL BANK OF
COMMERCE
By:______________________________
Name:
Title:
Address for notices:
Canadian Imperial Bank of Commerce
425 Lexington Avenue, 7th Floor
New York, NY 10025
Attention: William Swenson
Telephone: (212) 856-3935
Facsimile: (212) 856-3799
71
<PAGE>
MORGAN STANLEY SENIOR FUNDING,
INC.
By:_____________________________
Name:
Title:
Address for notices:
MORGAN STANLEY SENIOR FUNDING,
INC.
1585 Broadway, 10th Floor
New York, New York 10036
Attention: James Morgan
Telephone: (212) 761-4866
Facsimile: (212) 761-0592
72
<PAGE>
CRESCENT/MACH I PARTNERS, L.P.
by: TCW Asset Management Company,
its Investment Manager
By:_____________________________
Name:
Title:
Address for notices:
Crescent/Mach I Partners L.P.
c/o State Street Bank & Trust Co.
Two International Place
Boston, MA 02110
Attention: Elizabeth Kennedy
Telephone: (617) 664-5015
Facsimile: (617) 664-5291
PLEASE COPY RATE SET NOTICE TO:
Mark L. Gold/Justin L. Driscoll
Trust Company of the West
200 Park Avenue
New York, NY 10166
Telephone: (212) 771-4137
Fax: (212) 771-4159
73
<PAGE>
NEW YORK LIFE INSURANCE COMPANY
By:______________________________
Name:
Title:
Address for notices:
New York Life Insurance and
Annuity Corporation
c/o New York Life Insurance Company
51 Madison Avenue
Room 206
New York, New York 10010
Attention: Adam Clemens
Telephone: (212) 576-7238
Facsimile: (212) 447-4122
74
<PAGE>
CITY NATIONAL BANK
By:______________________________
Name:
Title:
Address for notices:
City National Bank
400 N. Roxbury Drive, 3rd Floor
Beverly Hills, CA 90210
Attention: Randall Watsek
Telephone: 310/888-6131
Fax: 310/888-6564
75
<PAGE>
TORONTO-DOMINION (NEW YORK),
INC.
By:_____________________________
Address for notices:
The Toronto-Dominion (New York), Inc.
909 Fannin, Suite 1700
Houston, TX 77010
Attention: Sonja Jordan
Telephone: 713/653-8244
Fax: 713/951-9921
76
<PAGE>
LEHMAN COMMERCIAL PAPER INC.
By:________________________
Address for notices:
Lehman Commercial Paper Inc.
3 World Financial Center
New York, NY 10285
Attention: Michele Swanson
Telephone: 212/526-0330
Fax: 212/526-0242
77
<PAGE>
CAPTIVA II FINANCE LTD.
By:___________________________
Address for notices:
Captiva II Finance Ltd.
c/o Deutsche Morgan Grenfell (Cayman)
Limited
P.O. Box 1984GT, Elizabethan Square
Grand Cayman, Cayman Islands
Attention: Director
Telephone: (345) 949-8244
Facsimile: (345) 949-8178
with a copy to:
Stanfield Capital Partners
330 Madison Avenue, 27th Flr.
New York, NY 10017
Attention: Christopher Bondy
Telephone: (212) 284-4304
Facsimile: (212) 284-4320
78
<PAGE>
CERES FINANCE LTD.
By:____________________________
Address for notices:
Ceres Finance Ltd.
c/o Deutsche Morgan Grenfell (Cayman)
Limited
P.O. Box 1984GT, Elizabethan Square
Grand Cayman, Cayman Islands
Attention: Director
Telephone: (345) 949-8244
Facsimile: (345) 949-8178
with a copy to:
Stanfield Capital Partners
330 Madison Avenue, 27th Flr.
New York, NY 10017
Attention: Christopher Bondy
Telephone: (212) 284-4304
Facsimile: (212) 284-4320
79
<PAGE>
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A., "RABOBANK
NEDERLAND", NEW YORK BRANCH
By:___________________________
Name:
Title:
By:___________________________
Name:
Title:
Address for notices:
Rabobank Nederland
245 Park Avenue
New York, NY 10167
Attention: M. Christina Debler
Telephone: (212) 916-7967
Facsimile: (212) 916-7837
80
<PAGE>
AMARA-2 FINANCE LTD.
By:_____________________________
Name:
Title:
Address for notices:
Amara-2 Finance Ltd.
c/o Stanfield Capital Partners LLC
330 Madison Avenue, 27th Flr.
New York, NY 10017
Attention: Christopher Bondy
Telephone: (212) 284-4304
Facsimile: (212) 284-4320
81
<PAGE>
MLCBO IV (CAYMAN) LTD.
BY: HIGHLAND CAPITAL MANAGEMENT
L.P., as Collateral Manager
By:______________________________
Name:
Title:
Address for notices:
MLCBO IV (CAYMAN) LTD.
c/o Highland Capital Management L.P.
as Collateral Manager
1150 Two Galleria Tower
13455 Noel Road, LB #45
Dallas, TX 75240
Attention: Mark Okada
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
82
<PAGE>
JACKSON NATIONAL LIFE INSURANCE
COMPANY
By: PPM America, Inc., as attorney-
in-fact, on behalf of Jackson National
Life Insurance Company
By:______________________________
Name:
Title:
Address for notices:
PPM America, Inc.
225 W. Wacker, Suite 1200
Chicago, IL 60606
Attention: Michael DiRe
Telephone: (312) 634-2509
Facsimile: (312) 634-0054
83
<PAGE>
CYPRESSTREE INVESTMENT PARTNERS
I., Ltd.
By: CypressTree Investment Management
Company, Inc., as Portfolio Manager
By:____________________________
Name:
Title:
Address for notices:
CypressTree Investment Partners I, Ltd.
125 High Street
Boston, MA 02110
Attention: John Fraser
Telephone: (617) 946-0600
Facsimile: (617) 946-5681
84
<PAGE>
INDOSUEZ CAPITAL FUNDING III,
LIMITED
By: Indosuez Capital, as Portfolio Advisor
By:______________________________
Name:
Title:
Address for notices:
Indosuez Capital Funding III, Limited
1211 Avenue of the Americas, 8th Floor
New York, NY 10036-8701
Attention: Melissa Marano
Telephone: (212) 278-2231
Facsimile: (212) 278-2250
85
<PAGE>
THE ROYAL BANK OF SCOTLAND plc
By:___________________________
Name:
Title:
Address for notices:
The Royal Bank of Scotland plc
Wall Street Plaza
88 Pine Street, 26th Floor
New York, NY 10005
Attention: Derek Bonner
Telephone: (212) 269-0938
Facsimile: (212) 269-8929
86
<PAGE>
ML CLO XX PILGRIM AMERICA
(CAYMAN) LTD.
By: Pilgrim Investments, Inc.
As its Investment Manager
By:_____________________________
Name:
Title:
Address for notices:
ML CLO XX Pilgrim America (Cayman) Ltd.
c/o Pilgrim Investments, Inc.
Two Renaissance Square
40 North Central Avenue, Suite 1200
Phoenix, AZ 85004-4424
Attention: Tom Burgess
Telephone: (602) 417-8248
Facsimile: (602) 417-8327
87
<PAGE>
PAM CAPITAL FUNDING LP
BY: HIGHLAND CAPITAL MANAGEMENT
L.P., as Collateral Manager
By:_______________________________
Name:
Title:
Address for notices:
PAM Capital Funding LP
c/o Highland Capital Management L.P.
1150 Two Galleria Tower
13455 Noel Road, LB #45
Dallas, TX 75240
Attention: Mark Okada
Telephone: (972) 233-4300
Facsimile: (972) 233-4343
88
<PAGE>
STEIN ROE & FARNHAM
INCORPORATED As Agent For
KEYPORT LIFE INSURANCE COMPANY
By:__________________________________
Name:
Title:
Address for notices:
Keyport Life Insurance Company
c/o Stein Roe & Farnham
One South Wacker Drive, 33rd Floor
Chicago, IL 60606
Attention: Brian W. Good
Telephone: (312) 368-7644
Facsimile: (312) 368-7857
89
<PAGE>
CHASE SECURITIES INC., as Agent
For The Chase Manhattan Bank, as
Assignee
By:__________________________________
Name:
Title:
Address for notices:
Chase Securities, Inc.
270 Park Avenue, 4th Floor
New York, NY 10017
Attention: William Bokos
Telephone: (212) 270-3142
Facsimile: (212) 270-7968
90
<PAGE>
ALLIANCE CAPITAL MANAGEMENT
L.P.,
As Manager on behalf of ALLIANCE CAPITAL
FUNDING, L.L.C.
By: ALLIANCE CAPITAL MANAGEMENT
CORPORATION, General Partner of Alliance
Capital Management L.P.
By:__________________________________
Name:
Title:
Address for notices:
Alliance Capital Funding, L.L.C.
Alliance Capital Management L.P.
1345 Avenue of the Americas, 38th Floor
New York, NY 10105
Attention: Savitri Alex
Telephone: (212) 969-1350
Facsimile: (212) 969-1466
91
<PAGE>
ALLIANCE INVESTMENTS, LIMITED,
As Assignee
By: Alliance Capital Management Corp.
By:__________________________________
Name:
Title:
Address for notices:
Alliance Capital Management L.P.
1345 Avenue of the Americas
New York, NY 10105
Attention: Savitri Alex
Alliance Investments, Ltd.
Telephone: (212) 969-1350
Facsimile: (212) 969-1466
92
<PAGE>
ML CLO XII PILGRIM AMERICA
(CAYMAN) LTD.
By: Pilgrim Investments, Inc.
As its Investment Manager
By:__________________________________
Name:
Title:
Address for notices:
ML CLO XII PILGRIM AMERICA
(CAYMAN) LTD.
c/o Pilgrim Investments, Inc.
Two Renaissance Square, Suite 1200
40 North Central Avenue
Phoenix, AZ 85004-4424
Attention: Tom Burgess
Telephone: (602) 417-8248
Facsimile: (602) 417-8327
93
<PAGE>
INTEGRITY LIFE INSURANCE COMPANY
By:__________________________________
Name:
Title:
Address for notices:
Integrity Life Insurance Company
515 W. Market Street
Louisville, KY 40202-3319
Attention: James Myjak
Telephone: (502) 582-7921
Facsimile: (502) 582-7903
94
<PAGE>
LTCB TRUST COMPANY
By:__________________________________
Name:
Title:
Address for notices:
LTCB Trust Company
165 Broadway, 49th Floor
New York, NY 10006
Attention: Junichi Ebihara
Telephone: (212) 335-4477
Facsimile: (212) 608-2371
95
<PAGE>
KZH CRESCENT-3 LLC
By:__________________________
Name:
Title:
Address for notices:
KZH Crescent-3 LLC c/o
The Chase Manhattan
Bank 450 West 33rd
Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
96
<PAGE>
CAPTIVA III FINANCE, LTD.,
as advised by Pacific Investment Management Company
By:___________________________
Address for notices:
Captiva III Finance, Ltd.
c/o Pacific Investment Management Co.
840 Newport Center Drive
Newport Beach, CA 92660
Attention: Melissa Fejdasz
Telephone: (949) 721-5169
Facsimile: (949) 718-2623
97
<PAGE>
KZH APPALOOSA LLC
By:___________________________
Name:
Title:
Address for notices:
KZH Appaloosa LLC
c/o The Chase Manhattan Bank
450 West 33rd Street - 15th Floor
New York, NY 10001
Attention: Virginia Conway
Telephone: (212) 946-7575
Facsimile: (212) 946-7776
98
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<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-START> OCT-01-1998
<PERIOD-END> DEC-31-1998
<EXCHANGE-RATE> 1
<CASH> 10,384
<SECURITIES> 0
<RECEIVABLES> 123,388
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 154,622
<PP&E> 718,920
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,711,274
<CURRENT-LIABILITIES> 122,592
<BONDS> 735,522
<COMMON> 0
0
0
<OTHER-SE> 730,660
<TOTAL-LIABILITY-AND-EQUITY> 1,711,274
<SALES> 168,484
<TOTAL-REVENUES> 168,484
<CGS> 129,812
<TOTAL-COSTS> 129,812
<OTHER-EXPENSES> 24,456
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,185
<INCOME-PRETAX> (1,969)
<INCOME-TAX> 609
<INCOME-CONTINUING> (2,578)
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<EXTRAORDINARY> 0
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