Document:

radnet_10q-ex1031.htm

Exhibit 10.31

EXECUTION VERSION

 

CREDIT AND GUARANTY AGREEMENT

 

dated as of April 6, 2010

 

among

 

RADNET MANAGEMENT, INC.,

as Borrower,

 

RADNET, INC.,

 

CERTAIN SUBSIDIARIES AND AFFILIATES OF RADNET MANAGEMENT, INC.,

as Guarantors,

 

The Several Lenders from Time to Time Parties Hereto,

 

BARCLAYS CAPITAL,

 

GE CAPITAL MARKETS, INC.,

 

DEUTSCHE BANK SECURITIES INC.,

 

and

 

RBC CAPITAL MARKETS,

as Joint Bookrunners and Joint Lead Arrangers,

 

GENERAL ELECTRIC CAPITAL CORPORATION,

 

and

 

DEUTSCHE BANK SECURITIES INC.,

as Co-Syndication Agents,

 

RBC CAPITAL MARKETS,

as Documentation Agent

 

and

 

BARCLAYS BANK PLC,

as Administrative Agent and Collateral Agent

________________________________________________________

 

$385,000,000 Senior Secured Credit Facilities

 

________________________________________________________

  

  

  

TABLE OF CONTENTS

 

	  	  	  	  	
Page

	 	 	 
	
ARTICLE I. DEFINITIONS AND INTERPRETATION

	  	
2

	  	
Section 1.01

	
Definitions

	  	
2

	  	
Section 1.02

	
Accounting Terms

	  	
37

	  	
Section 1.03

	
Interpretation, Etc.

	  	
37

	 	 	 
	
ARTICLE II. LOANS AND LETTERS OF CREDIT

	  	
38

	  	
Section 2.01

	
Term Loans

	  	
38

	  	
Section 2.02

	
Revolving Loans

	  	
38

	  	
Section 2.03

	
Swing Line Loans

	  	
40

	  	
Section 2.04

	
Issuance of Letters of Credit and Purchase of Participations Therein

	  	
42

	  	
Section 2.05

	
Pro Rata Shares; Availability of Funds

	  	
46

	  	
Section 2.06

	
Use of Proceeds

	  	
46

	  	
Section 2.07

	
Evidence of Debt; Register; Notes

	  	
47

	  	
Section 2.08

	
Interest on Loans

	  	
47

	  	
Section 2.09

	
Conversion/Continuation

	  	
50

	  	
Section 2.10

	
Default Interest

	  	
51

	  	
Section 2.11

	
Fees

	  	
51

	  	
Section 2.12

	
Scheduled Payments/Commitment Reductions

	  	
52

	  	
Section 2.13

	
Voluntary Prepayments/Commitment Reductions

	  	
53

	  	
Section 2.14

	
Mandatory Prepayments/Commitment Reductions

	  	
56

	  	
Section 2.15

	
Application of Prepayments/Reductions

	  	
58

	  	
Section 2.16

	
General Provisions Regarding Payments

	  	
58

	  	
Section 2.17

	
Ratable Sharing

	  	
60

	  	
Section 2.18

	
Making or Maintaining Eurodollar Rate Loans;

	  	
60

	  	
Section 2.19

	
Increased Costs; Capital Adequacy

	  	
62

	  	
Section 2.20

	
Taxes; Withholding, Etc.

	  	
63

	  	
Section 2.21

	
Obligation to Mitigate

	  	
66

	  	
Section 2.22

	
Defaulting Lenders

	  	
66

	  	
Section 2.23

	
Removal or Replacement of a Lender

	  	
67

	  	
Section 2.24

	
Incremental Facilities

	  	
68

	 	 	 
	
ARTICLE III. CONDITIONS PRECEDENT

	  	
71

	  	
Section 3.01

	
Closing Date

	  	
71

	  	
Section 3.02

	
Conditions to Each Credit Extension

	  	
75

	 	 	 
	
ARTICLE IV. REPRESENTATIONS AND WARRANTIES

	  	
76

	  	
Section 4.01

	
Organization; Requisite Power and Authority; Qualification

	  	
76

	  	
Section 4.02

	
Equity Interests and Ownership

	  	
76

	  	
Section 4.03

	
Due Authorization

	  	
76

	  	
Section 4.04

	
No Conflict

	  	
77

	  	
Section 4.05

	
Governmental Consents

	  	
77

  

i

  

	  	
Section 4.06

	
Binding Obligation

	  	
77

	  	
Section 4.07

	
Historical Financial Statements

	  	
77

	  	
Section 4.08

	
Projections

	  	
77

	  	
Section 4.09

	
No Material Adverse Change

	  	
77

	  	
Section 4.10

	
Certain Fees

	  	
78

	  	
Section 4.11

	
Adverse Proceedings, Etc.

	  	
78

	  	
Section 4.12

	
Payment of Taxes

	  	
78

	  	
Section 4.13

	
Properties

	  	
78

	  	
Section 4.14

	
Environmental Matters

	  	
79

	  	
Section 4.15

	
No Defaults

	  	
79

	  	
Section 4.16

	
Material Contracts

	  	
79

	  	
Section 4.17

	
Governmental Regulation

	  	
79

	  	
Section 4.18

	
Margin Stock

	  	
79

	  	
Section 4.19

	
Employee Matters

	  	
80

	  	
Section 4.20

	
Employee Benefit Plans

	  	
80

	  	
Section 4.21

	
Solvency

	  	
81

	  	
Section 4.22

	
Compliance with Statutes, Etc.

	  	
81

	  	
Section 4.23

	
Disclosure

	  	
81

	  	
Section 4.24

	
PATRIOT Act

	  	
81

	  	
Section 4.25

	
Intellectual Property

	  	
81

	  	
Section 4.26

	
Health Care Matters

	  	
82

	 	 	 
	
ARTICLE V. AFFIRMATIVE COVENANTS

	  	
85

	  	
Section 5.01

	
Financial Statements and Other Reports

	  	
85

	  	
Section 5.02

	
Existence

	  	
89

	  	
Section 5.03

	
Payment of Taxes and Claims

	  	
89

	  	
Section 5.04

	
Maintenance of Properties

	  	
89

	  	
Section 5.05

	
Insurance

	  	
89

	  	
Section 5.06

	
Books and Records; Inspections

	  	
90

	  	
Section 5.07

	
Lenders’ Meetings

	  	
90

	  	
Section 5.08

	
Compliance with Contractual Obligations and Laws

	  	
90

	  	
Section 5.09

	
Environmental Compliance

	  	
90

	  	
Section 5.10

	
Subsidiaries

	  	
90

	  	
Section 5.11

	
Additional Material Real Estate Assets

	  	
91

	  	
Section 5.12

	
Additional Collateral

	  	
91

	  	
Section 5.13

	
Further Assurances

	  	
92

	  	
Section 5.14

	
Control Accounts; Approved Deposit Accounts

	  	
92

	  	
Section 5.15

	
Maintenance of Ratings

	  	
92

	  	
Section 5.16

	
Compliance with Healthcare Laws

	  	
92

	 	 	 
	
ARTICLE VI. NEGATIVE COVENANTS

	  	
93

	  	
Section 6.01

	
Indebtedness

	  	
93

	  	
Section 6.02

	
Liens

	  	
95

	  	
Section 6.03

	
No Further Negative Pledges

	  	
97

	  	
Section 6.04

	
Restricted Junior Payments

	  	
97

	  	
Section 6.05

	
Restrictions on Subsidiary Distributions

	  	
98

	  	
Section 6.06

	
Investments

	  	
98

  

ii

  

	  	
Section 6.07

	
Financial Covenants

	  	
99

	  	
Section 6.08

	
Fundamental Changes; Disposition of Assets; Acquisitions

	  	
101

	  	
Section 6.09

	
Disposal of Subsidiary Interests

	  	
102

	  	
Section 6.10

	
Sales and Lease-Backs

	  	
102

	  	
Section 6.11

	
Transactions with Shareholders and Affiliates

	  	
102

	  	
Section 6.12

	
Conduct of Business

	  	
102

	  	
Section 6.13

	
Permitted Activities of Holdings

	  	
103

	  	
Section 6.14

	
Amendments or Waivers of Organizational Documents, Material Contracts and Certain Indebtedness

	  	
103

	  	
Section 6.15

	
Fiscal Year

	  	
103

	  	
Section 6.16

	
Post-Closing Undertakings

	  	
103

	 	 	 
	
ARTICLE VII. GUARANTY

	  	
104

	  	
Section 7.01

	
Guaranty of the Obligations

	  	
104

	  	
Section 7.02

	
Contribution by Guarantors

	  	
104

	  	
Section 7.03

	
Payment by Guarantors

	  	
105

	  	
Section 7.04

	
Liability of Guarantors Absolute

	  	
105

	  	
Section 7.05

	
Waivers by Guarantors

	  	
107

	  	
Section 7.06

	
Guarantors’ Rights of Subrogation, Contribution, Etc.

	  	
108

	  	
Section 7.07

	
Subordination of Other Obligations

	  	
108

	  	
Section 7.08

	
Continuing Guaranty

	  	
108

	  	
Section 7.09

	
Authority of Guarantors or the Borrower

	  	
108

	  	
Section 7.10

	
Financial Condition of the Borrower

	  	
109

	  	
Section 7.11

	
Bankruptcy, Etc.

	  	
109

	  	
Section 7.12

	
Discharge of Guaranty Upon Sale of Guarantor

	  	
110

	 	 	 
	
ARTICLE VIII. EVENTS OF DEFAULT

	  	
110

	  	
Section 8.01

	
Events of Default

	  	
110

	 	 	 
	ARTICLE IX. AGENTS	  	
113

	  	
Section 9.01

	
Appointment of Agents

	  	
113

	  	
Section 9.02

	
Powers and Duties

	  	
114

	  	
Section 9.03

	
General Immunity

	  	
114

	  	
Section 9.04

	
Agents Entitled to Act as Lender

	  	
116

	  	
Section 9.05

	
Lenders’ Representations, Warranties and Acknowledgment

	  	
116

	  	
Section 9.06

	
Right to Indemnity

	  	
117

	  	
Section 9.07

	
Successor Administrative Agent, Collateral Agent and Swing Line Lender

	  	
118

	  	
Section 9.08

	
Security Documents and Guaranty

	  	
119

	  	
Section 9.09

	
Withholding Taxes

	  	
120

	  	
Section 9.10

	
Administrative Agent May File Proofs of Claim

	  	
121

	 	 	 
	
ARTICLE X. MISCELLANEOUS

	  	
121

	  	
Section 10.01

	
Notices

	  	
121

	  	
Section 10.02

	
Expenses

	  	
123

	  	
Section 10.03

	
Indemnity

	  	
124

	  	
Section 10.04

	
Set-Off

	  	
125

  

iii

  

	  	
Section 10.05

	
Amendments and Waivers

	  	
125

	  	
Section 10.06

	
Successors and Assigns; Participations

	  	
128

	  	
Section 10.07

	
Independence of Covenants, Etc.

	  	
132

	  	
Section 10.08

	
Survival of Representations, Warranties and Agreements

	  	
132

	  	
Section 10.09

	
No Waiver; Remedies Cumulative

	  	
132

	  	
Section 10.10

	
Marshalling; Payments Set Aside

	  	
132

	  	
Section 10.11

	
Severability

	  	
132

	  	
Section 10.12

	
Obligations Several; Independent Nature of Lenders’ Rights

	  	
133

	  	
Section 10.13

	
Table of Contents and Headings

	  	
133

	  	
Section 10.14

	
APPLICABLE LAW

	  	
133

	  	
Section 10.15

	
CONSENT TO JURISDICTION

	  	
133

	  	
Section 10.16

	
WAIVER OF JURY TRIAL

	  	
134

	  	
Section 10.17

	
Confidentiality

	  	
135

	  	
Section 10.18

	
Usury Savings Clause

	  	
136

	  	
Section 10.19

	
Counterparts

	  	
136

	  	
Section 10.20

	
Effectiveness; Entire Agreement; No Third Party Beneficiaries

	  	
136

	  	
Section 10.21

	
PATRIOT Act

	  	
137

	  	
Section 10.22

	
Electronic Execution of Assignments

	  	
137

	  	
Section 10.23

	
No Fiduciary Duty

	  	
137

  

iv

  

	
SCHEDULES:

	
1.01(a)

	
Tranche B Term Loan Commitments

	  	
1.01(b)

	
Revolving Commitments

	  	
1.01(c)

	
Notice Addresses

	  	
4.01

	
Jurisdictions of Organization and Qualification

	  	
4.02

	
Equity Interests and Ownership

	  	
4.13

	
Real Estate Assets

	  	
4.26

	
Compliance with Health Care Laws and Permits

	  	
5.11

	
Actions with Respect to Additional Material Real Estate Assets

	  	
6.01

	
Certain Indebtedness

	  	
6.02

	
Certain Liens

	  	
6.06

	
Certain Investments

	  	
6.16

	
Post-Closing Undertakings

	  	  	  
	
EXHIBITS:

	
A-1

	
Borrowing Notice

	  	
A-2

	
Conversion/Continuation Notice

	  	
A-3

	
Issuance Notice

	  	
B-1

	
Tranche B Term Loan Note

	  	
B-2

	
Revolving Loan Note

	  	
B-3

	
Swing Line Note

	  	
B-4

	
Incremental Term Loan Note

	  	
C

	
Compliance Certificate

	  	
D-1

	
Opinion of Sheppard, Mullin, Richter & Hampton

	  	
D-2

	
Opinion of Jeff Linden

	  	
E

	
Assignment Agreement

	  	
F

	
Certificate re Non-Bank Status

	  	
G-1

	
Closing Date Certificate

	  	
G-2

	
Solvency Certificate

	  	
H

	
Counterpart Agreement

	  	
I

	
Pledge and Security Agreement

	  	
J

	
Landlord Waiver and Consent Agreement

	  	
K

	
Intercompany Note

	  	
L

	
Joinder Agreement

  

v

  

CREDIT AND GUARANTY AGREEMENT

 

This CREDIT AND GUARANTY AGREEMENT, dated as of April 6, 2010, is entered into by and among RADNET MANAGEMENT, INC., a California corporation (the “Borrower”), RADNET, INC., a Delaware corporation (“Holdings”), CERTAIN SUBSIDIARIES and AFFILIATES OF THE BORROWER, as Guarantors, the Lenders party hereto from time to time, GENERAL ELECTRIC CAPITAL CORPORATION (“GECC”) and DEUTSCHE BANK SECURITIES INC. (“DBSI”), as co-syndication agents (together, the “Co-Syndication Agents”), RBC CAPITAL MARKETS1, as documentation agent (the “Documentation Agent”) and BARCLAYS BANK PLC (“Barclays Bank”), as Administrative Agent (together with its permitted successors in such capacity, the “Administrative Agent”) and as Collateral Agent (together with its permitted successors in such capacity, the “Collateral Agent”).

 

RECITALS:

 

WHEREAS, capitalized terms used in these Recitals have the respective meanings set forth for such terms in Section 1.1 hereof;

 

WHEREAS, the Lenders have agreed to extend certain credit facilities to the Borrower in an aggregate principal amount not to exceed $385,000,000, consisting of $285,000,000 aggregate principal amount of Tranche B Term Loans and $100,000,000 aggregate principal amount of Revolving Commitments, the proceeds of which shall be used to repay certain existing Indebtedness of the Borrower and its Subsidiaries, consummate the Related Acquisitions after the Closing Date, pay expenses related thereto and to provide funds for other general corporate purposes of the Borrower and its Subsidiaries;

 

WHEREAS, the Borrower has agreed to secure all of its Obligations by granting to the Collateral Agent, for the benefit of the Secured Parties, a First Priority Lien on substantially all of its assets, including a pledge of all of the Equity Interests of each of its Domestic Subsidiaries, 66.0% of all of the voting Equity Interests of each of its Foreign Subsidiaries and all of the non-voting Equity Interests of each of its Foreign Subsidiaries; and

 

WHEREAS, the Guarantors have agreed to guarantee the obligations of the Borrower hereunder and to secure their respective Obligations by granting to the Collateral Agent, for the benefit of the Secured Parties, a First Priority Lien on substantially all of their respective assets, including a pledge of all of the Equity Interests of each of their respective Domestic Subsidiaries (including the Borrower), 66.0% of all of the voting Equity Interests of each of their respective Foreign Subsidiaries and all of the non-voting Equity Interests of each of their respective Foreign Subsidiaries.

 

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

  

  

 

ARTICLE I.

DEFINITIONS AND INTERPRETATION

 

Section 1.01     Definitions.  The following terms used herein, including in the preamble, recitals, exhibits and schedules hereto, shall have the following meanings:

 

“Acquisition Consideration” means the purchase consideration for any Permitted Acquisition and all other payments by any Loan Party or any of its Subsidiaries in exchange for, or as part of, or in connection with, any Permitted Acquisition, whether paid in cash or by exchange of Equity Interests or of properties or otherwise and whether payable at or prior to the consummation of such Permitted Acquisition or deferred for payment at any future time, whether or not any such future payment is subject to the occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, “earn-outs” and other agreements to make any payment the amount of which is, or the terms of payment of which are, in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any Person or business.

 

“Adjusted Eurodollar Rate” means, for any Interest Rate Determination Date with respect to an Interest Period for a Eurodollar Rate Loan, the greater of (I) 2.00% per annum and (II) the rate per annum obtained by dividing (and rounding upward to the next whole multiple of 1/100 of 1.00%) (i) (a) the rate per annum (rounded to the nearest 1/100 of 1.00%) equal to the rate determined by the Administrative Agent to be the offered rate which appears on the page of the Reuters Screen which displays an average British Bankers Association Interest Settlement Rate (such page currently being LIBOR01 page) for deposits (for delivery on the first day of such period) with a term equivalent to such period in Dollars, determined as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, or (b) in the event the rate referenced in the preceding clause (a) does not appear on such page or service or if such page or service shall cease to be available, the rate per annum (rounded to the nearest 1/100 of 1.00%) equal to the rate determined by the Administrative Agent to be the offered rate on such other page or other service which displays an average British Bankers Association Interest Settlement Rate for deposits (for delivery on the first day of such period) with a term equivalent to such period in Dollars, determined as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, or (c) in the event the rates referenced in the preceding clauses (a) and (b) are not available, the rate per annum (rounded to the nearest 1/100 of 1.00%) equal to the offered quotation rate to first class banks in the London interbank market by the Administrative Agent for deposits (for delivery on the first day of the relevant period) in Dollars of amounts in same day funds comparable to the principal amount of the applicable Loan of the Administrative Agent, in its capacity as a Lender, for which the Adjusted Eurodollar Rate is then being determined with maturities comparable to such period as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, by (ii) an amount equal to (a) one minus (b) the Applicable Reserve Requirement.

 

“Administrative Agent” has the meaning specified in the preamble hereto.

  

2

  

“Adverse Proceeding” means any action, suit, proceeding, hearing (in each case, whether administrative, judicial or otherwise), governmental investigation or arbitration (whether or not purportedly on behalf of any Loan Party or any of its Subsidiaries) at law or in equity, or before or by any Governmental Authority, domestic or foreign (including any Environmental Claims), whether pending or, to the knowledge of any Loan Party or any of its Subsidiaries, threatened against or adversely affecting any Loan Party or any of its Subsidiaries or any property of any Loan Party or any of its Subsidiaries.

 

“Affected Lender” has the meaning set forth in Section 2.18(b).

 

“Affected Loans” has the meaning set forth in Section 2.18(b).

 

“Affiliate” means, as applied to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power (i) to vote 10.00% or more of the Securities having ordinary voting power for the election of directors of such Person or (ii) to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting securities or by contract or otherwise.

 

“Agent” means each of the Administrative Agent, the Co-Syndication Agents, the Collateral Agent and the Documentation Agent and solely for purposes of Article IX, the Joint Lead Arrangers.

 

“Agent Affiliates” has the meaning set forth in Section 10.01(b).

 

“Aggregate Amounts Due” has the meaning set forth in Section 2.17.

 

“Aggregate Payments” has the meaning set forth in Section 7.02.

 

“Agreement” means this Credit and Guaranty Agreement, dated as of April 6, 2010, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

“Applicable Margin” means:

 

 (i) (a) with respect to Tranche B Term Loans that are Eurodollar Rate Loans, 3.75% per annum and (b) with respect to Tranche B Term Loans that are Base Rate Loans, 2.75% per annum; and

 

 (ii) (a) with respect to Revolving Loans that are Eurodollar Rate Loans, 3.75% per annum and (b) with respect to Revolving Loans and Swing Line Loans that are Base Rate Loans, 2.75% per annum.

  

3

  

“Applicable Revolving Commitment Fee Percentage” means, as at any date of determination, a rate per annum equal to 0.75%; provided that so long as the Leverage Ratio of the Borrower and its Subsidiaries for the twelve-month period ended on the date of delivery of a Compliance Certificate pursuant to Section 5.01(c) is less than 3.25:1.00, the Applicable Revolving Commitment Fee Percentage shall be a rate per annum equal to 0.50%.  No change in the Applicable Revolving Commitment Fee Percentage shall be effective until three (3) Business Days after the date on which the Administrative Agent has received the applicable financial statements and a Compliance Certificate pursuant to Section 5.01(c) calculating the Leverage Ratio.  At any time the Borrower has not submitted to the Administrative Agent the applicable information as and when required under Section 5.01(c) or at any time when an Event of Default exists and is continuing, the Applicable Revolving Commitment Fee Percentage shall be determined as if the Leverage Ratio were in excess of 3.25:1.00.  In the event that any financial statement or certificate delivered pursuant to Section 5.01 is shown to be inaccurate, and such inaccuracy, if corrected, would have led to the application of a higher Applicable Revolving Commitment Fee Percentage for any period (an “Applicable Period”) than the Applicable Revolving Commitment Fee Percentage applied for such Applicable Period, then (i) the Borrower shall immediately deliver to the Administrative Agent a correct certificate required by Section 5.01 for such Applicable Period and (ii) the Borrower shall immediately pay to the Administrative Agent the accrued additional fees owing as a result of such increased Applicable Revolving Commitment Fee Percentage for such Applicable Period.

“Applicable Reserve Requirement” means, at any time, for any Eurodollar Rate Loan, the maximum rate, expressed as a decimal, at which reserves (including any basic marginal, special, supplemental, emergency or other reserves) are required to be maintained with respect thereto against “Eurocurrency liabilities” (as such term is defined in Regulation D) under regulations issued from time to time by the Board of Governors or other applicable banking regulator.  Without limiting the effect of the foregoing, the Applicable Reserve Requirement shall reflect any other reserves required to be maintained by such member banks with respect to (i) any category of liabilities which includes deposits by reference to which the applicable Adjusted Eurodollar Rate or any other interest rate of a Loan is to be determined, or (ii) any category of extensions of credit or other assets which include Eurodollar Rate Loans.  A Eurodollar Rate Loan shall be deemed to constitute Eurocurrency liabilities and as such shall be deemed subject to reserve requirements without benefits of credit for proration, exceptions or offsets that may be available from time to time to the applicable Lender.  The rate of interest on Eurodollar Rate Loans shall be adjusted automatically on and as of the effective date of any change in the Applicable Reserve Requirement.

 

“Approved Deposit Account” means a Deposit Account maintained by any Loan Party that is the subject of an effective Deposit Account Control Agreement.  “Approved Deposit Account” includes all monies on deposit in a Deposit Account and all certificates and instruments, if any, representing or evidencing such Deposit Account.

 

“Approved Electronic Communications” means any notice, demand, communication, information, document or other material that any Loan Party provides to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein which is distributed to Agents or to Lenders by means of electronic communications pursuant to Section 10.01(b).

 

“Approved Securities Intermediary” means a “securities intermediary” or “commodity intermediary” (as such terms are defined in the UCC).

  

4

  

“Asset Sale” means a sale, lease or sub-lease (as lessor or sublessor), sale and leaseback, assignment, conveyance, exclusive license (as licensor or sublicensor), transfer or other disposition to, or any exchange of property with, any Person (other than the Borrower or any Wholly-Owned Subsidiary Guarantor), in one transaction or a series of transactions, of all or any part of Holdings’ or any of its Subsidiaries’ businesses, assets or properties of any kind, whether real, personal, or mixed and whether tangible or intangible, whether now owned or hereafter acquired, leased or licensed, including the Equity Interests of Subsidiaries, other than (i) inventory sold, leased or licensed out in the ordinary course of business (excluding any such sales, leases or licenses out by operations or divisions discontinued or to be discontinued) and (ii) sales, leases or licenses out of other assets for aggregate consideration of less than $1,000,000 with respect to any transaction or series of related transactions.

 

“Assignment Agreement” means an Assignment and Assumption Agreement substantially in the form of Exhibit E, with such amendments or modifications as may be approved by the Administrative Agent.

 

“Assignment Effective Date” has the meaning specified in Section 10.06(b).

 

“Authorized Officer” means, as applied to any Person, any individual holding the position of chairman of the board (if an officer), chief executive officer, president or one of its vice presidents (or the equivalent thereof), and such Person’s chief financial officer or treasurer.

 

“Available Amount” means, as of any date of determination, the aggregate cumulative amount of 50% of Consolidated Excess Cash Flow (if positive) for each Fiscal Year commencing with the Fiscal Year ending December 31, 2010, that has not been previously applied pursuant to Sections 6.04(b) or 6.06(j).

 

“Bankruptcy Code” means Title 11 of the United States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.

 

“Barclays Bank” has the meaning specified in the preamble hereto.

 

“Barclays Capital” means Barclays Capital, the investment banking division of Barclays Bank.

 

“Base Rate” means, for any day, a rate per annum equal to the greater of (i) the Prime Rate in effect on such day, (ii) the Federal Funds Effective Rate in effect on such day plus 1⁄2 of 1.00%, (iii) 3.00% and (iv) the Adjusted Eurodollar Rate that would be payable on such day for a Eurodollar Rate Loan with a one-month Interest Period plus 1.00%.  Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

 

“Base Rate Loan” means a Loan bearing interest at a rate determined by reference to the Base Rate.

 

“Beneficiary” means each Agent, Issuing Bank, Lender and Lender Counterparty.

 

“Beverly” means Beverly Radiology Medical Group III, a California general partnership.

  

5

  

 

“Beverly Radiology” means Beverly Radiology Medical Group, Inc., a California corporation.

 

“BRMG Management Agreement” means that certain Amended and Restated Management and Service Agreement, dated as of January 1, 2004, by and among Borrower and Beverly Radiology, as in effect of the Closing Date.

 

“Board of Governors” means the Board of Governors of the United States Federal Reserve System, or any successor thereto.

 

“Borrower” has the meaning specified in the preamble hereto.

 

“Borrowing Notice” means a notice substantially in the form of Exhibit A-1.

 

“Breastlink” means Breastlink Medical Group, Inc., a California corporation.

 

“Business Day” means (i) any day excluding Saturday, Sunday and any day which is a legal holiday under the laws of the State of New York or is a day on which banking institutions located in such state are authorized or required by law or other governmental action to close and (ii) with respect to all notices, determinations, fundings and payments in connection with the Adjusted Eurodollar Rate or any Eurodollar Rate Loans, the term “Business Day” means any day which is a Business Day described in clause (i) and which is also a day for trading by and between banks in Dollar deposits in the London interbank market.

 

“Capital Lease” means, as applied to any Person, any lease of any property (whether real, personal or mixed) by that Person as lessee that, in conformity with GAAP, is or should be accounted for as a capital lease on the balance sheet of that Person.

 

“Capitated Contracts” means all of Loan Parties’ contracts whether presently existing or hereafter executed between Loan Parties and various health maintenance organizations and all proceeds therefrom.

 

“Cash” means money, currency or a credit balance in any demand or Deposit Account.

 

“Cash Equivalents” means, as at any date of determination, any of the following: (i) marketable securities (a) issued or directly and unconditionally guaranteed as to interest and principal by the United States Government or (b) issued by any agency of the United States the obligations of which are backed by the full faith and credit of the United States, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (ii) marketable direct obligations issued by any state of the United States of America or any political subdivision of any such state or any public instrumentality thereof, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (iii) certificates of deposit or bankers’ acceptances maturing within three months after such date and issued or accepted by any Lender or by any commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia that (a) is at least “adequately capitalized” (as defined in the regulations of its primary Federal banking regulator), (b) has Tier 1 capital (as defined in such regulations) of not less than $1,000,000,000 and (c) has a rating of at least AA- from S&P and Aa3 from Moody’s; and (iv) shares of any money market mutual fund that (a) has substantially all of its assets invested continuously in the types of investments referred to in clauses (i) and (ii) above, (b) has net assets of not less than $5,000,000,000 and (c) has the highest rating obtainable from either S&P or Moody’s.

  

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“Certificate re Non-Bank Status” means a certificate substantially in the form of Exhibit F.

 

“Change of Control” means, (i) any Person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) (a) shall have acquired beneficial ownership or control of 35.0% or more on a fully diluted basis of the voting and/or economic interest in the Equity Interests of Holdings or (b) shall have obtained the power (whether or not exercised) to elect a majority of the members of the board of directors (or similar governing body) of Holdings; (ii) Holdings shall cease to beneficially own and control, free and clear of all Liens (other than Liens in favor of the Collateral Agent for the benefit of Secured Parties), 100.0% on a fully diluted basis of the economic and voting interest in the Equity Interests of the Borrower; (iii) the majority of the seats (other than vacant seats) on the board of directors (or similar governing body) of Holdings cease to be occupied by Persons who either (a) were members of the board of directors of Holdings on the Closing Date or (b) were nominated for election by the board of directors of Holdings, a majority of whom were directors on the Closing Date or whose election or nomination for election was previously approved by a majority of such directors; or (iv) any “change of control” (or similar event, however denominated) shall occur under and as defined in any indenture or agreement in respect of Material Indebtedness, including any Indebtedness incurred pursuant to Section 6.02(c) to which Holdings or any of its Subsidiaries is a party.

 

“Class” means (i) with respect to Lenders, each of the following classes of Lenders: (a) Lenders having Tranche B Term Loan Exposure, (b) Lenders having Revolving Exposure (including Swing Line Lender) and (c) Lenders having Incremental Term Loan Exposure of each applicable Series, and (ii) with respect to Loans, each of the following classes of Loans: (a) Tranche B Term Loans, (b) Revolving Loans (including Swing Line Loans) and (c) each Series of Incremental Term Loans.

 

“Closing Date” means the date on which the Term Loans are made, which occurred on April 6, 2010.

 

“Closing Date Certificate” means a Closing Date Certificate substantially in the form of Exhibit G-1.

 

“Co-Syndication Agents” has the meaning specified in the preamble hereto.

 

“Collateral” means, collectively, all of the real, personal and mixed property (including Equity Interests) in which Liens are purported to be granted pursuant to the Security Documents as security for the Obligations.

 

“Collateral Agent” has the meaning specified in the preamble hereto.

  

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“Commitment” means any Revolving Commitment or Term Loan Commitment.

 

“Commitment Letter” has the meaning set forth in Section 10.20.

 

“Commodities Account” has the meaning set forth in the UCC.

 

“Compliance Certificate” means a Compliance Certificate substantially in the form of Exhibit C.

 

“Consolidated Adjusted EBITDA” means, for any period, an amount determined for Holdings and its Subsidiaries on a consolidated basis equal to (i) Consolidated Net Income, plus, to the extent reducing Consolidated Net Income, the sum, without duplication, of amounts for (a) consolidated interest expense, (b) provisions for taxes based on income, (c) total depreciation expense, (d) total amortization expense, (e) specified operating lease expenses to the extent that a specific operating lease has been terminated and converted to a capital lease or purchased for cash prior to the end of the term thereof (and during such measurement period) it being understood and agreed that with respect to any such terminated operating leases which have been so terminated on or prior to the Closing Date, for the fiscal quarters ended March 31, 2010 and June 30, 2010, such additional amounts shall be equal to $1,420,000 and $533,000, respectively, (f) pro forma cost savings relating to any Permitted Acquisition in an amount not to exceed $4,000,000 for any individual Permitted Acquisition and in an aggregate amount for all Permitted Acquisitions (in each case for the term of this Agreement) not to exceed $20,000,000 to the extent permitted by the second paragraph of this definition, (g) other non-Cash charges reducing Consolidated Net Income, including non-Cash stock compensation expenses (excluding any such non-Cash charge to the extent that it represents an accrual or reserve for potential Cash charge in any future period or amortization of a prepaid Cash charge that was paid in a prior period), (h) Transaction Costs, (i) non-recurring employee severance expenses not to exceed $1,500,000 during any twelve-month period, and (j) non-recurring, non-operational expenses (net of any non-recurring, non-operational income) reflected on the Consolidated Statements of Operations of Radnet, Inc. and its Subsidiaries under the heading “Other Expenses (Income”) not to exceed $3,000,000 during any twelve-month period, minus (ii) other non-Cash gains increasing Consolidated Net Income for such period (excluding any such non-Cash gain to the extent it represents the reversal of an accrual or reserve for potential Cash gain in any prior period); provided, that for the avoidance of doubt, regardless of whether any prepayment of Offer Loans pursuant to Section 2.13(c) is deemed to result in a non-cash gain, no such gain shall increase Consolidated Adjusted EBITDA and provided further that, notwithstanding the foregoing, the Consolidated Adjusted EBITDA for the fiscal quarters ended September 30, 2009, and December 31, 2009 shall be deemed to be $28,737 and $29,257, respectively, as such amount may be further adjusted with respect to events after the Closing Date pursuant to clause (e) of this paragraph and the following paragraph.

  

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With respect to any period during which a Permitted Acquisition or an Asset Sale has occurred (each, a “Subject Transaction”), for purposes of determining compliance with the financial covenants set forth in Section 6.07 (but not for purposes of determining Applicable Revolving Commitment Fee Percentage), Consolidated Adjusted EBITDA shall be calculated with respect to such period on a pro forma basis (including pro forma adjustments arising out of events which are directly attributable to a specific transaction, are factually supportable and are expected to have a continuing impact, in each case determined on a basis consistent with Article 11 of Regulation S-X promulgated under the Securities Act and as interpreted by the staff of the SEC, which would include cost savings resulting from head count reduction, closure of facilities and similar restructuring charges, which pro forma adjustments shall be certified by the chief financial officer of Holdings) using the historical financial statements, audited or as otherwise acceptable to the Administrative Agent, of any business so acquired or to be acquired or sold or to be sold and the consolidated financial statements of Holdings and its Subsidiaries which shall be reformulated as if such Subject Transaction, had been consummated or incurred or repaid at the beginning of such period.  For the fiscal quarters ended March 31, 2010, June 30, 2010, September 30, 2010 and December 31, 2010, such pro forma adjustments with respect to acquisitions consummated prior to the Closing Date and the Related Acquisitions shall be equal to $9,874,000, $6,599,000, $3,930,000 and $1,676,000, respectively.

 

“Consolidated Capital Expenditures” means, for any period, the aggregate of all expenditures of Holdings and its Subsidiaries during such period (by the expenditure of cash or (without duplication), the incurrence of Indebtedness), determined on a consolidated basis, for any fixed asset or improvements or for replacements, substitutions or additions thereto that, in accordance with GAAP, are required to be capitalized; provided, that Consolidated Capital Expenditures shall not include any expenditures (i) for replacements and substitutions for fixed assets, capital assets or equipment to the extent made with Net Cash Proceeds invested pursuant to Section 2.14(a) or Section 2.14(b) or (ii) which constitute a Permitted Acquisition permitted under Section 6.08.

 

“Consolidated Cash Interest Expense” means, for any period, total interest expense (including that portion attributable to Capital Leases in accordance with GAAP and capitalized interest) of Holdings and its Subsidiaries on a consolidated basis with respect to all outstanding Indebtedness of Holdings and its Subsidiaries, including all commissions, discounts and other fees and charges owed with respect to letters of credit and net costs under Interest Rate Agreements, but excluding, however, any amount not payable in Cash in such period and any amounts referred to in Section 2.11(d) or (e) payable on or before the Closing Date.

 

“Consolidated Current Assets” means, as at any date of determination, the total assets of a Person and its Subsidiaries on a consolidated basis that may properly be classified as current assets in conformity with GAAP, excluding Cash and Cash Equivalents.

 

“Consolidated Current Liabilities” means, as at any date of determination, the total liabilities of a Person and its Subsidiaries on a consolidated basis that may properly be classified as current liabilities in conformity with GAAP, excluding the current portion of long term debt.

 

“Consolidated Excess Cash Flow” means, for any period, an amount (if positive) equal to:

 

(i) the sum, without duplication, of the amounts for such period of (a) Consolidated Net Income, plus, (b) to the extent reducing Consolidated Net Income, the sum, without duplication, of amounts for non-Cash charges reducing Consolidated Net Income, including for depreciation and amortization (excluding any such non-Cash charge to the extent that it represents an accrual or reserve for potential Cash charge in any future period or amortization of a prepaid Cash charge that was paid in a prior period), plus (c) the Consolidated Working Capital Adjustment, minus

  

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(ii) the sum, without duplication, of (a) the amounts for such period paid in cash from operating cash flow of (1) scheduled repayments of Indebtedness for borrowed money (excluding repayments of Revolving Loans or Swing Line Loans except to the extent the Revolving Commitments are permanently reduced in connection with such repayments) and scheduled repayments of obligations under Capital Leases (excluding any interest expense portion thereof), (2) Consolidated Capital Expenditures, and (3) Permitted Acquisitions (including transaction costs with respect thereto), plus (b) other non-Cash gains increasing Consolidated Net Income for such period (excluding any such non-Cash gain to the extent it represents the reversal of an accrual or reserve for potential Cash gain in any prior period); and provided, that, for the avoidance of doubt, no prepayment of Offer Loans pursuant to Section 2.13(c) shall reduce the calculation of Consolidated Excess Cash Flow pursuant to this clause (ii) of the definition of Consolidated Excess Cash Flow.

 

“Consolidated Net Income” means, for any period, (i) the net income (or loss) of Holdings and its Subsidiaries on a consolidated basis for such period taken as a single accounting period determined in conformity with GAAP, minus (ii) (a) the income (or loss) of any Person (other than a Subsidiary of Holdings) in which any other Person (other than Holdings or any of its Subsidiaries) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to Holdings or any of its Subsidiaries by such Person during such period, (b) the income (or loss) of any Person accrued prior to the date it becomes a Subsidiary of Holdings or is merged into or consolidated with Holdings or any of its Subsidiaries or that Person’s assets are acquired by Holdings or any of its Subsidiaries, (c) the income of any Subsidiary of Holdings to the extent that the declaration or payment of dividends or similar distributions by that Subsidiary of that income is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary, (d) any after-tax gains or losses attributable to Asset Sales or returned surplus assets of any Pension Plan, and (e) (to the extent not included in clauses (a) through (d) above) any net extraordinary gains or net extraordinary losses.

 

“Consolidated Total Debt” means, as of any date of determination, (a) the aggregate stated balance sheet amount of all Indebtedness of Holdings and its Subsidiaries (or, if higher, the par value or stated face amount of all such Indebtedness (other than zero coupon Indebtedness), determined on a consolidated basis in accordance with GAAP minus (b) up to $25,000,000 in Cash or Cash Equivalents included in the consolidated balance sheet of Holdings and its Subsidiaries and subject to a Deposit Account Control Agreement or Securities Account Control Agreement, as applicable.

 

“Consolidated Total Secured Debt” means, as of any date of determination, all the aggregate stated balance sheet amount of all Indebtedness of Holdings and its Subsidiaries (or, if higher, the par value or stated face amount of all such Indebtedness (other than zero coupon Indebtedness), determined on a consolidated basis in accordance with GAAP which is secured by a Lien on the assets of Holdings or any Subsidiary thereof (calculated, without duplication, net of up to $25,000,000 in Cash or Cash Equivalents included in the consolidated balance sheet of Holdings and its Subsidiaries and subject to a Deposit Account Control Agreement or Securities Account Control Agreement, as applicable).

  

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“Consolidated Working Capital” means, as at any date of determination, the excess of Consolidated Current Assets of Holdings and its Subsidiaries over Consolidated Current Liabilities of Holdings and its Subsidiaries.

 

“Consolidated Working Capital Adjustment” means, for any period on a consolidated basis, the amount (which may be a negative number) by which Consolidated Working Capital as of the beginning of such period exceeds (or is less than) Consolidated Working Capital as of the end of such period.  In calculating the Consolidated Working Capital Adjustment there shall be excluded the effect of reclassification during such period of current assets to long term assets and current liabilities to long term liabilities and the effect of any Permitted Acquisition during such period; provided, that there shall be included with respect to any Permitted Acquisition during such period an amount (which may be a negative number) by which the Consolidated Working Capital acquired in such Permitted Acquisition as at the time of such acquisition exceeds (or is less than) Consolidated Working Capital at the end of such period.

 

“Contractual Obligation” means, as applied to any Person, any provision of any Security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject.

 

“Contributing Guarantors” has the meaning set forth in Section 7.02.

 

“Control Account” means a Securities Account or Commodities Account that is the subject of an effective Securities Account Control Agreement and that is maintained by any Loan Party with an Approved Securities Intermediary.  “Control Account” includes all Financial Assets held in a Securities Account or a Commodities Account and all certificates and instruments, if any, representing or evidencing the Financial Assets contained therein.

 

“Conversion/Continuation Date” means the effective date of a continuation or conversion, as the case may be, as set forth in the applicable Conversion/Continuation Notice.

 

“Conversion/Continuation Notice” means a Conversion/Continuation Notice substantially in the form of Exhibit A-2.

 

“Counterpart Agreement” means a Counterpart Agreement substantially in the form of Exhibit H delivered by a Loan Party pursuant to Section 5.10.

 

“Credit Date” means the date of a Credit Extension.

 

“Credit Extension” means the making of a Loan or the issuing or renewal of a Letter of Credit.

  

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“Currency Agreement” means any foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or other similar agreement or arrangement, each of which is for the purpose of hedging the foreign currency risk associated with Holdings’ and its Subsidiaries’ operations and not for speculative purposes.

 

“DBSI” has the meaning specified in the preamble hereto.

 

“Default” means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default.

 

“Default Rate” has the meaning set forth in Section 2.10.

 

“Defaulting Lender” means any Lender that has (a) failed to fund any portion of its Revolving Commitment within three (3) Business Days of the date required to be funded by it hereunder, unless the subject of a good faith dispute, (b) notified the Borrower, the Administrative Agent or any Lender in writing, or has otherwise indicated through a public statement, that it does not intend to comply with its funding obligations hereunder and generally under agreements in which it commits to extend credit, (c) failed, within three Business Days after receipt of a written request from the Administrative Agent, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Revolving Commitments, (d) otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three Business Days of the date when due, unless the subject of a good faith dispute or (e) become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, custodian, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, custodian, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment, provided that a Lender shall not qualify as a Defaulting Lender solely as a result of the acquisition or maintenance of an ownership interest in such Lender or its parent company, or of the exercise of control over such Lender or any Person controlling such Lender, by a Governmental Authority or instrumentality thereof; provided that if the Borrower, the Administrative Agent, Swing Line Lender and the Issuing Bank agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any cash collateralization of Letters of Credit and/or Swing Line Loans), that Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Swing Line Commitment and/or the Letter of Credit Commitment and funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis by the Lenders in accordance with their Pro Rata Shares (without giving effect to Section 2.22), whereupon that Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

  

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“Defaulting Revolving Lender” has the meaning set forth in Section 2.22.

 

“Deposit Account” means a demand, time, savings, passbook or like account with a bank, savings and loan association, credit union or like organization, other than an account evidenced by a negotiable certificate of deposit.

 

“Deposit Account Control Agreement” has the meaning set forth in the Pledge and Security Agreement.

 

“Disqualified Equity Interests” means any Equity Interest which, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (i) matures or is mandatorily redeemable (other than solely for Equity Interests which are not otherwise Disqualified Equity Interests), pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the option of the holder thereof (other than solely for Equity Interests which are not otherwise Disqualified Equity Interests), in whole or in part, (iii) provides for scheduled payments or dividends in cash or (iv) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Equity Interests, in each case, prior to the date that is 91 days after the Term Loan Maturity Date, except, in the case of clauses (i) and (ii), if as a result of a change of control or asset sale, so long as any rights of the holders thereof upon the occurrence of such a change of control or asset sale event are subject to the prior payment in full of all Obligations, the cancellation or expiration of all Letters of Credit and the termination of the Commitments).

 

“Documentation Agent” has the meaning specified in the preamble hereto.

 

“Dollars” and the sign “$” mean the lawful money of the United States of America.

 

“Domestic Subsidiary” means any Subsidiary organized under the laws of the United States of America, any State thereof or the District of Columbia.

 

“Eligible Assignee” means any Person other than a natural Person that is (i) a Lender, an Affiliate of any Lender or a Related Fund (any two or more Related Funds being treated as a single Eligible Assignee for all purposes hereof), or (ii) a commercial bank, insurance company, investment or mutual fund or other entity that is an “accredited investor” (as defined in Regulation D under the Securities Act) and which extends credit or buys loans in the ordinary course of business; provided, that neither any Loan Party nor any Affiliate thereof shall be an Eligible Assignee.

 

“Employee Benefit Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA which is or was sponsored, maintained or contributed to by, or required to be contributed by, any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates or with respect to which any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates has or could reasonably be expected to have liability, contingent or otherwise, under ERISA.

  

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“Environmental Claim” means any investigation, notice, notice of violation, claim, action, suit, proceeding, demand, abatement order or other order, decree or directive (conditional or otherwise) by any Governmental Authority or any other Person, arising (i) pursuant to any Environmental Law, (ii) in connection with any actual or alleged violation of, or liability pursuant to, any Environmental Law, including any Governmental Authorizations issued pursuant to Environmental Law, (iii) in connection with any Hazardous Material, including the presence or Release of, or exposure to, any Hazardous Materials and any abatement, removal, remedial, corrective or other response action related to Hazardous Materials or (iv) in connection with any actual or alleged damage, injury, threat or harm to health, safety, natural resources or the environment.

 

“Environmental Laws” means any and all current or future foreign or domestic, federal, state or local laws (including any common law), statutes, ordinances, orders, rules, regulations, judgments or any other requirements of Governmental Authorities relating to or imposing liability or standards of conduct with respect to (i) environmental matters, (ii) the generation, use, storage, transportation or disposal of, or exposure to, Hazardous Materials; or (iii) occupational safety and health, industrial hygiene, land use or the protection of human, plant or animal health or welfare, in any manner applicable to any Loan Party or any of its Subsidiaries or any Facility.

 

“Equity Interests” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including partnership interests and membership interests, and any and all warrants, rights or options to purchase or other arrangements or rights to acquire any of the foregoing.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, the regulations promulgated thereunder and any successor thereto.

 

“ERISA Affiliate” means, as applied to any Person, (i) any corporation which is a member of a controlled group of corporations within the meaning of Section 414(b) of the Internal Revenue Code of which that Person is a member; (ii) any trade or business (whether or not incorporated) which is a member of a group of trades or businesses under common control within the meaning of Section 414(c) of the Internal Revenue Code of which that Person is a member; and (iii) any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any corporation described in clause (i) above or any trade or business described in clause (ii) above is a member.  Any former ERISA Affiliate of any Loan Party or any of its Subsidiaries shall continue to be considered an ERISA Affiliate of such Loan Party or any such Subsidiary within the meaning of this definition with respect to the period such entity was an ERISA Affiliate of such Loan Party or such Subsidiary and with respect to liabilities arising after such period for which such Loan Party or such Subsidiary could be liable under the Internal Revenue Code or ERISA.

  

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“ERISA Event” means (i) a “reportable event” within the meaning of Section 4043 of ERISA and the regulations issued thereunder with respect to any Pension Plan (excluding those for which the provision for 30-day notice to the PBGC has been waived by regulation); (ii) the failure to meet the minimum funding standard of Sections 412 or 430 of the Internal Revenue Code or Sections 302 or 303 of ERISA with respect to any Pension Plan (whether or not waived in accordance with Section 412(c) of the Internal Revenue Code or Section 302(c) of ERISA) or the failure to make by its due date a required installment under Section 430(j) of the Internal Revenue Code with respect to any Pension Plan or the failure to make any required contribution to a Multiemployer Plan; (iii) a determination that any Pension Plan is, or is expected to be, in “at risk” status (as defined in Section 430 of the Internal Revenue Code or Section 303 of ERISA); (iv) the provision by the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA; (v) a determination that any Multiemployer Plan is, or is expected to be, in “critical” or “endangered” status under Section 432 of the Internal Revenue Code or Section 305 of ERISA; (vi) the withdrawal by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability to any Loan Party, any of its Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or 4064 of ERISA; (vii) the institution by the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or condition which might constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (viii) the imposition of liability on any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA; (ix) the withdrawal of any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any potential liability therefor, or the receipt by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates of notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A or 4042 of ERISA; (x) the occurrence of an act or omission which could give rise to the imposition on any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates of fines, penalties, taxes or related charges under Chapter 43 of the Internal Revenue Code or under Section 409, Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee Benefit Plan; (xi) the assertion of a material claim (other than routine claims for benefits) against any Employee Benefit Plan or the assets thereof other than a Multiemployer Plan or the assets thereof, or against any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates in connection with any Employee Benefit Plan; (xii) receipt from the Internal Revenue Service of notice of the failure of any Pension Plan (or any other Employee Benefit Plan intended to be qualified under Section 401(a) of the Internal Revenue Code) to qualify under Section 401(a) of the Internal Revenue Code, or the failure of any trust forming part of any Pension Plan to qualify for exemption from taxation under Section 501(a) of the Internal Revenue Code; (xiii) the imposition of a Lien pursuant to Section 430(k) of the Internal Revenue Code or Section 303(k) of ERISA or a violation of Section 436 of the Internal Revenue Code with respect to any Pension Plan; (xiv) the occurrence of a non-exempt “prohibited transaction” with respect to which any Loan Party or any of its Subsidiaries is a “disqualified person” or a “party of interest” (within the meaning of Section 4975 of the Internal Revenue Code or Section 406 of ERISA, respectively) or which could reasonably be expected to result in liability to any Loan Party or any of its Subsidiaries or (xv) any other event or condition with respect to an Employee Benefit Plan with respect to which any Loan Party or any of its Subsidiaries is likely to incur liability other than in the ordinary course.

  

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“Eurodollar Rate Loan” means a Loan bearing interest at a rate determined by reference to the Adjusted Eurodollar Rate.

 

“Event of Default” means any of the conditions or events set forth in Section 8.01.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute.

 

“Excluded Foreign Subsidiary” means any Foreign Subsidiary in respect of which either (a) the pledge of greater than 66.0% of the voting Equity Interests of such Subsidiary as Collateral or (b) the guaranteeing by such Subsidiary of the Obligations would, in the good faith judgment of the Borrower, result in material adverse tax consequences to the Borrower.

 

“Existing Indebtedness” means Indebtedness and other obligations outstanding under (i) that certain Credit Agreement, dated as of November 15, 2006, between the Borrower, the guarantors thereto, the lenders party thereto and General Electric Capital Corporation, as Agent, as amended prior to the Closing Date and (ii) that certain Second Lien Credit Agreement, dated as of November 15, 2006, between the Borrower, the guarantors thereto, the lenders party thereto and General Electric Capital Corporation, as Agent, as amended prior to the Closing Date.

 

“Existing Rate Agreement” means that certain 2002 IDSA Master Agreement entered into as of April 11, 2006 between HSBC Bank USA, National Association and the Borrower (together with all schedules, exhibits and amendments related thereto, the “HSBC Hedge Agreement”).

 

“Extraordinary Receipts” means any Cash received by or paid to or for the account of Holdings or any of its Subsidiaries not in the ordinary course of business, including purchase price adjustments, Tax refunds, judgments and litigation settlements, pension plan reversions, proceeds of insurance (excluding proceeds of business interruption insurance to the extent such proceeds constitute compensation for lost earnings and proceeds described in clause (b) of the definition of the term “Net Cash Proceeds”) and indemnity payments.

 

“Facility” means any real property (including all buildings, fixtures or other improvements located thereon) now, hereafter or heretofore owned, leased, operated or used by any Loan Party or any of its Subsidiaries or any of their respective predecessors or Affiliates.

 

“Fair Labor Standards Act” means the Fair Labor Standards Act, 29 U.S.C. §201 et seq.

 

“Fair Share” has the meaning set forth in Section 7.02.

 

“Fair Share Contribution Amount” has the meaning set forth in Section 7.02.

  

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“Federal Funds Effective Rate” means for any day, the rate per annum (expressed, as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1.00%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided, that (i) if such day is not a Business Day, the Federal Funds Effective Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if no such rate is so published on such next succeeding Business Day, the Federal Funds Effective Rate for such day shall be the average rate charged to the Administrative Agent, in its  capacity as a Lender, on such day on such transactions as determined by the Administrative Agent.

 

 “Financial Asset” has the meaning set forth in the UCC.

 

“Financial Officer Certification” means, with respect to the financial statements for which such certification is required, the certification of the chief financial officer of Holdings that such financial statements fairly present, in all material respects, the financial condition of Holdings and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject to changes resulting from audit and normal year-end adjustments.

 

“Financial Plan” has the meaning set forth in Section 5.01(h).

 

“First Priority” means, with respect to any Lien purported to be created in any Collateral pursuant to any Security Document, that such Lien is the only Lien to which such Collateral is subject, other than any Permitted Lien.

 

“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

 

“Fiscal Year” means the fiscal year of Holdings and its Subsidiaries ending on December 31st of each calendar year.

 

“Flood Zone” means areas having special flood hazards as described in the National Flood Insurance Act of 1968, as amended from time to time, and any successor statute.

 

“Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

 

“Funding Guarantors” has the meaning set forth in Section 7.02.

 

“GAAP” means, subject to the limitations on the application thereof set forth in Section 1.02, United States generally accepted accounting principles in effect as of the date of determination thereof consistently applied.

 

“GECC” has the meaning specified in the preamble hereto.

 

“GECM” means, GE Capital Markets, Inc.

  

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“Governmental Acts” means any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority.

 

“Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity, officer or examiner exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the United States, the United States, or a foreign entity or government.

 

“Governmental Authorization” means any permit, license, authorization, certification, registration, approval, plan, directive, consent order or consent decree of or from any Governmental Authority.

 

“Grantor” has the meaning specified in the Pledge and Security Agreement.

 

“Guaranteed Obligations” has the meaning set forth in Section 7.01.

 

“Guarantor” means each of Holdings, Beverly, Beverly Radiology, Breastlink and ProNet and each Subsidiary of Holdings (other than the Borrower, any Excluded Foreign Subsidiary and any Joint Ventures otherwise permitted by this Agreement).

 

“Guaranty” means the guaranty of each Guarantor set forth in Article VII.

 

“Hazardous Materials” means any pollutant, contaminant, chemical, waste, material or substance, exposure to which or Release of which is prohibited, limited or regulated by any Governmental Authority or which may or could pose a hazard to human health and safety or to the indoor or outdoor environment, including petroleum, petroleum products, asbestos, urea formaldehyde, radioactive materials, polychlorinated biphenyls (“PCBs”) and toxic mold.

 

“Health Care Laws” means (i) any and all federal, state and local fraud and abuse laws, including, without limitation, the federal Anti-Kickback Statute (42 U.S.C. § 1320a-7b), the Stark Law (42 U.S.C. § 1395nn and §1395(q)), the civil False Claims Act (31 U.S.C. § 3729 et seq.), Sections 1320a-7 and 1320a-7a of Title 42 of the United States Code and the regulations promulgated pursuant to such statutes; (ii) the federal Food, Drug & Cosmetic Act (21 U.S.C. §§ 301 et seq.) and the regulations promulgated thereunder, (iii) the Health Insurance Portability and Accountability Act of 1996 (Pub. L. No. 104-191) and the regulations promulgated thereunder and any applicable state privacy and security laws, (iv) Medicare (Title XVIII of the Social Security Act) and the regulations promulgated thereunder; (v) Medicaid (Title XIX of the Social Security Act) and the regulations promulgated thereunder; (vi) the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L. No. 108-173) and the regulations promulgated thereunder; (vii) quality, safety and accreditation standards and requirements of all applicable state laws or regulatory bodies; (viii) Requirements of Law relating to the ownership or operation of a health care facility or business, or assets used in connection therewith, (ix) Requirements of Law relating to the billing or submission of claims, collection of accounts receivable, underwriting the cost of, or provision of management or administrative services in connection with, any and all of the foregoing, by any Loan Party and any of their Subsidiaries, including, but not limited to, laws and regulations relating to practice of medicine and other health care professions, professional fee splitting, tax-exempt organization and charitable trust law applicable to health care organizations, certificates of need, certificates of operations and authority, and (x) any and all other applicable health care laws, regulations, manual provisions, policies and administrative guidance, each of (i) through (x) as may be amended from time to time.

  

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“Hedge Agreement” means (i) an Interest Rate Agreement or a Currency Agreement entered into with a Lender Counterparty and satisfactory to the Administrative Agent and (ii) the Existing Rate Agreement.

 

“Highest Lawful Rate” means the maximum lawful interest rate, if any, that at any time or from time to time may be contracted for, charged, or received under the laws applicable to any Lender which are presently in effect or, to the extent allowed by law, under such applicable laws which may hereafter be in effect and which allow a higher maximum nonusurious interest rate than applicable laws now allow.

 

“Historical Financial Statements” means as of the Closing Date, the unqualified audited financial statements of Holdings and its Subsidiaries for the immediately preceding three (3) Fiscal Years, consisting of balance sheets and the related consolidated statements of income, stockholders’ equity and cash flows for such Fiscal Years, certified by the chief financial officer of the Borrower that they fairly present, in all material respects, the financial condition of Holdings and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject to changes resulting from audit and normal year-end adjustments.

 

“Holdings” has the meaning specified in the preamble hereto.

 

“Increased Amount Date” has the meaning set forth in Section 2.24.

 

“Increased-Cost Lenders” has the meaning set forth in Section 2.23.

 

“Incremental Revolving Commitments” has the meaning set forth in Section 2.24.

 

“Incremental Revolving Loan Lender” has the meaning set forth in Section 2.24.

 

“Incremental Revolving Loans” has the meaning set forth in Section 2.24.

 

“Incremental Term Loan Commitments” has the meaning set forth in Section 2.24.

 

“Incremental Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Incremental Term Loans of such Lender.

 

“Incremental Term Loan Lender” has the meaning set forth in Section 2.24.

  

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“Incremental Term Loan Maturity Date” means the date on which Incremental Term Loans of a Series shall become due and payable in full hereunder, as specified in the applicable Joinder Agreement, including by acceleration or otherwise.

 

“Incremental Term Loan Note” means a promissory note in the form of Exhibit B-4, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

“Incremental Term Loans” has the meaning set forth in Section 2.24.

 

“Indebtedness” means, as applied to any Person, without duplication, (i) all indebtedness for borrowed money; (ii) that portion of obligations with respect to Capital Leases that is properly classified as a liability on a balance sheet in conformity with GAAP; (iii) notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money; (iv) any obligation owed for all or any part of the deferred purchase price of property or services, including any earn-out obligations (excluding any such obligations incurred under ERISA), which purchase price is (a) due more than six (6) months from the date of incurrence of the obligation in respect thereof or (b) evidenced by a note or similar written instrument; (v) all indebtedness secured by any Lien on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is nonrecourse to the credit of that Person; (vi) the face amount of any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; (vii) Disqualified Equity Interests, (viii) the direct or indirect guaranty, endorsement (otherwise than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another; (ix) any obligation of such Person the primary purpose or intent of which is to provide assurance to an obligee that the obligation of the obligor thereof will be paid or discharged, or any agreement relating thereto will be complied with, or the holders thereof will be protected (in whole or in part) against loss in respect thereof; (x) any liability of such Person for an obligation of another through any agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise acquire such obligation or any security therefor, or to provide funds for the payment or discharge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise) or (b) to maintain the solvency or any balance sheet item, level of income or financial condition of another if, in the case of any agreement described under subclauses (a) or (b) of this clause (x), the primary purpose or intent thereof is as described in clause (ix) above; and (xi) all obligations of such Person in respect of any exchange traded or over the counter derivative transaction, including any Interest Rate Agreement and any Currency Agreement, in each case, whether entered into for hedging or speculative purposes.

  

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“Indemnified Liabilities” means, collectively, any and all liabilities, obligations, losses, damages (including natural resource damages), penalties, claims (including Environmental Claims), actions, judgments, suits, costs (including the costs of any investigation, study, sampling, testing, abatement, cleanup, removal, remediation or other necessary response action related to the Release or presence of any Hazardous Materials), expenses and disbursements of any kind or nature whatsoever (including the reasonable fees and disbursements of counsel for Indemnitees in connection with any investigative, administrative or judicial proceeding or hearing commenced or threatened by any Person (including any Loan Party or its Subsidiaries), whether or not any such Indemnitee shall be designated as a party or a potential party thereto, and any fees or expenses incurred by Indemnitees in enforcing this indemnity), whether direct, indirect, special or consequential and whether based on any federal, state or foreign laws, statutes, rules or regulations (including securities and commercial laws, statutes, rules or regulations and Environmental Laws), on common law or equitable cause or on tort, contract or otherwise, that may be imposed on, incurred by, or asserted against any such Indemnitee, in any manner relating to or arising out of (i) this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby (including the Lenders’ agreement to make Credit Extensions, the syndication of the credit facilities provided for herein or the use or intended use of the proceeds thereof, or any enforcement of any of the Loan Documents (including any sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty)); (ii) the Commitment Letter delivered by any Agent or any Lender to the Borrower with respect to the transactions contemplated by this Agreement; (iii) any Environmental Claim relating to or arising from, directly or indirectly, any past or present activity, operation, land ownership, or practice of any Loan Party or any of its Subsidiaries; or (iv) any Loan or the use of proceeds thereof.

 

“Indemnitee” has the meaning set forth in Section 10.03.

 

“Installment” has the meaning set forth in Section 2.12.

 

“Installment Date” has the meaning set forth in Section 2.12.

 

“Intellectual Property” has the meaning set forth in the Pledge and Security Agreement.

 

“Intellectual Property Asset” means, at the time of determination, any interest (fee, license or otherwise) then owned by any Loan Party in any Intellectual Property.

 

“Intellectual Property Security Agreements” has the meaning set forth in the Pledge and Security Agreement.

 

“Intercompany Note” means a promissory note substantially in the form of Exhibit K evidencing Indebtedness owed among Loan Parties and their Subsidiaries.

 

“Interest Coverage Ratio” means the ratio as of the last day of any Fiscal Quarter of (i) Consolidated Adjusted EBITDA for the four-Fiscal-Quarter period then ended to (ii) Consolidated Cash Interest Expense for such four-Fiscal-Quarter period.

 

“Interest Payment Date” means with respect to (i) any Loan that is a Base Rate Loan (including any Swing Line Loan), each March 31, June 30, September 30 and December 31 of each year, commencing on the first such date to occur after the Closing Date and the final maturity date of such Loan; and (ii) any Loan that is a Eurodollar Rate Loan, the last day of each Interest Period applicable to such Loan; provided, that in the case of each Interest Period of longer than three (3) months “Interest Payment Date” shall also include each date that is three (3) months, or an integral multiple thereof, after the commencement of such Interest Period.

  

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“Interest Period” means, in connection with a Eurodollar Rate Loan, an interest period of one-, two-, three- or six-months (or, if consented to by all of the applicable Lenders, nine or twelve months), as selected by the Borrower in the applicable Borrowing Notice or Conversion/Continuation Notice, (i) initially, commencing on the Credit Date or Conversion/Continuation Date thereof, as the case may be; and (ii) thereafter, commencing on the day on which the immediately preceding Interest Period expires; provided, that (a) if an Interest Period would otherwise expire on a day that is not a Business Day, such Interest Period shall expire on the next succeeding Business Day unless no further Business Day occurs in such month, in which case such Interest Period shall expire on the immediately preceding Business Day; (b) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall, subject to clauses (c) and (d), of this definition, end on the last Business Day of a calendar month; (c) no Interest Period with respect to any portion of any Class of Term Loans shall extend beyond such Class’s Term Loan Maturity Date; and (d) no Interest Period with respect to any portion of the Revolving Loans shall extend beyond the Revolving Commitment Termination Date.

 

“Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedging agreement  or other similar agreement or arrangement, each of which is for the purpose of hedging the interest rate exposure associated with Holdings’ and its Subsidiaries’ operations and not for speculative purposes.

 

“Interest Rate Determination Date” means, with respect to any Interest Period, the date that is two (2) Business Days prior to the first day of such Interest Period.

 

“Internal Revenue Code” means the Internal Revenue Code of 1986, as amended to the date hereof and from time to time hereafter, and any successor statute.

 

“Investment” means (i) any direct or indirect purchase or other acquisition by any Loan Party or any of its Subsidiaries of, or of a beneficial interest in, any of the Securities of any other Person; (ii) any direct or indirect redemption, retirement, purchase or other acquisition for value, by any Loan Party or its Subsidiaries from any Person, of any Equity Interests of such Person; (iii) any direct or indirect loan, advance (other than advances to employees for moving, entertainment and travel expenses, drawing accounts and similar expenditures in the ordinary course of business) or capital contributions by any Loan Party or any of its Subsidiaries to any other Person, including all indebtedness and accounts receivable from that other Person that are not current assets or did not arise from sales or services rendered to that other Person in the ordinary course of business and (iv) all investments consisting of any exchange traded or over the counter derivative transaction, including any Interest Rate Agreement and Currency Agreement, whether entered into for hedging or speculative purposes.  The amount of any Investment of the type described in clauses (i), (ii) and (iii) shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment.

 

“Issuance Notice” means an Issuance Notice substantially in the form of Exhibit A-3.

  

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“Issuing Bank” means Barclays Bank PLC as Issuing Bank hereunder, together with its permitted successors and assigns in such capacity.

 

“Joinder Agreement” means an agreement substantially in the form of Exhibit L.

 

“Joint Lead Arrangers” means Barclays Capital, DBSI, GECM and RBC Capital, in their capacities as joint lead arrangers and joint bookrunners under the Commitment Letter.

 

“Joint Venture” means a joint venture, partnership or other similar arrangement, whether in corporate, partnership or other legal form; provided, that in no event shall any corporate Subsidiary of any Person be considered to be a Joint Venture to which such Person is a party, other than Majority-Owned Joint Ventures.

 

“Landlord Personal Property Collateral Access Agreement” means a Landlord Waiver and Consent Agreement substantially in the form of Exhibit J with such amendments or modifications as may be approved by the Collateral Agent.

 

“Lender” means each financial institution listed on the signature pages hereto as a Lender, and any other Person that becomes a party hereto pursuant to an Assignment Agreement or a Joinder Agreement.  Unless the context clearly indicates otherwise, the term “Lenders” shall include the Swing Line Lender.

 

“Lender Counterparty” means (i) each Lender, each Agent and each of their respective Affiliates counterparty to a Hedge Agreement (including any Person who is an Agent or a Lender (and any Affiliate thereof) as of the Closing Date but subsequently, whether before or after entering into a Hedge Agreement, ceases to be an Agent or a Lender, as the case may be) and (ii) with respect to the Existing Rate Agreement, HSBC Bank USA, National Association and its affiliates and assignees.

 

“Letter of Credit” means a commercial or standby letter of credit issued or to be issued by the Issuing Bank pursuant to this Agreement.

 

“Letter of Credit Commitment” means the obligation of an Issuing Bank to issue, and of the Lenders having a Revolving Commitment to participate in, Letters of Credit pursuant to Section 2.04.

 

“Letter of Credit Sublimit” means the lesser of (i) $10,000,000 and (ii) the aggregate unused amount of the Revolving Commitments then in effect.

 

“Letter of Credit Usage” means, as at any date of determination, the sum of (i) the maximum aggregate amount which is, or at any time thereafter may become, available for drawing under all Letters of Credit then outstanding, and (ii) the aggregate amount of all drawings under Letters of Credit honored by the Issuing Bank and not theretofore reimbursed by or on behalf of the Borrower.

 

“Leverage Ratio” means the ratio as of the applicable date of determination of (i) Consolidated Total Debt as of such day to (ii) Consolidated Adjusted EBITDA for the four-Fiscal-Quarter period most recently ended for which quarterly financial statements have been made available to the Lenders.

  

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“Lien” means (i) any lien, mortgage, pledge, assignment, security interest, charge or encumbrance of any kind (including any agreement to give any of the foregoing, any conditional sale or other title retention agreement, and any lease or license in the nature thereof) and any option, trust or other preferential arrangement having the practical effect of any of the foregoing and (ii) in the case of Securities, any purchase option, call or similar right of a third party with respect to such Securities.

 

“Loan” means a Tranche B Term Loan, a Revolving Loan, a Swing Line Loan and an Incremental Term Loan.

 

“Loan Document” means any of this Agreement, the Notes, if any, the Security Documents, any documents or certificates executed by the Borrower in favor of the Issuing Bank relating to Letters of Credit, and all other documents, instruments or agreements executed and delivered by a Loan Party for the benefit of any Agent, the Issuing Bank or any Lender in connection herewith on or after the date hereof.

 

“Loan Party” means the Borrower and each Guarantor.

 

“Majority Owned Joint Venture” means, with respect to any Person, a Joint Venture to which such Person is a party wherein such Person owns an equity interest in such Joint Venture greater than 50%.

 

“Margin Stock” as defined in Regulation U of the Board of Governors as in effect from time to time.

 

“Material Adverse Effect” means any event, change, effect, development, circumstance or condition that has caused or could reasonably be expected to cause a material adverse change, material adverse effect on and/or material adverse developments with respect to (i) the business, assets, liabilities, operations, management, condition (financial or otherwise), or  results of operations of the Loan Parties and their Subsidiaries taken as a whole; (ii) the ability of any Loan Party to fully and timely perform its Obligations; (iii) the legality, validity, binding effect or enforceability against a Loan Party of a Loan Document to which it is a party; or (iv) the rights, remedies and benefits available to, or conferred upon, any Agent and any Lender or any Secured Party under any Loan Document.

 

“Material Contract” means any contract or other arrangement to which any Loan Party or any of its Subsidiaries is a party (other than the Loan Documents) for which breach, nonperformance, cancellation or failure to renew could reasonably be expected to have a Material Adverse Effect.

 

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of Credit) of any one or more of the Loan Parties or any Subsidiary in an individual principal amount (or Net Mark-to-Market Exposure) of $5,000,000 or more.

  

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“Material Real Estate Asset” means (i) any fee-owned Real Estate Asset having a fair market value in excess of $2,500,000 as of the date of the acquisition thereof or (ii) any Real Estate Asset that the Required Lenders have determined is material to the business, general affairs, assets, liabilities, operations, management, condition (financial or otherwise), stockholders’ equity, results of operations or value of any Loan Party or any Subsidiary thereof, including the Borrower.

 

“Moody’s” means Moody’s Investor Services, Inc.

 

“Mortgage” means a Mortgage in form and substance satisfactory to the Collateral Agent and the Administrative Agent.

 

“Multiemployer Plan” means any Employee Benefit Plan which is a “multiemployer plan” as defined in Section 3(37) or Section 4001(a)(3) of ERISA.

 

“NAIC” means The National Association of Insurance Commissioners, and any successor thereto.

 

“Narrative Report” means, with respect to the financial statements for which such narrative report is required, a narrative report describing the operations of Holdings and its Subsidiaries in the form prepared for presentation to senior management thereof for the applicable Fiscal Quarter or Fiscal Year and for the period from the beginning of the then current Fiscal Year to the end of such period to which such financial statements relate.

 

“Net Cash Proceeds” means (a) with respect to any Asset Sale, an amount equal to:  (i) Cash payments (including any Cash received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) received by Holdings or any of its Subsidiaries from such Asset Sale, minus (ii) any bona fide direct costs incurred in connection with such Asset Sale, including (1) income or gains taxes payable by the seller as a result of any gain recognized in connection with such Asset Sale, (2) payment of the outstanding principal amount of, premium or penalty, if any, and interest on any Indebtedness (other than the Loans) that is secured by a Lien on the stock or assets in question and that is required to be repaid under the terms thereof as a result of such Asset Sale, (3) a reasonable reserve for any indemnification payments (fixed or contingent) attributable to seller’s indemnities and representations and warranties to purchaser in respect of such Asset Sale undertaken by Holdings or any of its Subsidiaries in connection with such Asset Sale and (4) reasonable costs and expenses associated therewith, including reasonable legal fees and expenses; (b) (i) any Cash payments or proceeds received by Holdings or any of its Subsidiaries (1) under any casualty insurance policy in respect of a covered loss thereunder (excluding proceeds of business interruption insurance to the extent such proceeds constitute compensation for lost earnings and proceeds) or (2) as a result of the taking of any assets of Holdings or any of its Subsidiaries by any Person pursuant to the power of eminent domain, condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power under threat of such a taking, minus (ii) (1) any actual and reasonable costs incurred by Holdings or any of its Subsidiaries in connection with the adjustment or settlement of any claims of Holdings or such Subsidiary in respect thereof, (2) any bona fide direct costs incurred in connection with any sale of such assets as referred to in preceding clause (i)(2), including income taxes payable as a result of any gain recognized in connection therewith and (3) reasonable costs and expenses associated therewith, including reasonable fees and expenses; (c) with respect to any issuance or incurrence of Indebtedness, the Cash proceeds thereof, net of underwriting discounts and commissions and other reasonable costs and expenses associated therewith, including reasonable legal fees and expenses; and (d) with respect to any Extraordinary Receipt, the Cash proceeds received by or paid to or for the account of Holdings or any of its Subsidiaries.

 

 

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“Net Mark-to-Market Exposure” of a Person means, as of any date of determination, the excess (if any) of all unrealized losses over all unrealized profits of such Person arising from Hedge Agreements or other Indebtedness of the type described in clause (xi) of the definition thereof.  As used in this definition, “unrealized losses” means the fair market value of the cost to such Person of replacing such Hedge Agreement or such other Indebtedness as of the date of determination (assuming the Hedge Agreement or such other Indebtedness were to be terminated as of that date), and “unrealized profits” means the fair market value of the gain to such Person of replacing such Hedge Agreement or such other Indebtedness as of the date of determination (assuming such Hedge Agreement or such other Indebtedness were to be terminated as of that date).

 

“Non-Consenting Lender” has the meaning set forth in Section 2.23.

 

“Non-Public Information” means information which has not been disseminated in a manner making it available to investors generally, within the meaning of Regulation FD.

 

“Non-Subsidiary Guarantor” has the meaning set forth in Section 4.02.

 

“Non-U.S. Lender” has the meaning set forth in Section 2.20(c).

 

“Note” means a Tranche B Term Note, an Incremental Term Loan Note, a Revolving Loan Note or a Swing Line Note.

 

“Notice” means a Borrowing Notice, an Issuance Notice, or a Conversion/ Continuation Notice.

 

“Obligations” means all obligations of every nature of each Loan Party, including obligations from time to time owed to Agents (including former Agents), the Joint Lead Arrangers, Lenders or any of them and Lender Counterparties, under any Loan Document or Hedge Agreement, whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Loan Party, would have accrued on any Obligation, whether or not a claim is allowed against such Loan Party for such interest in the related bankruptcy proceeding), reimbursement of amounts drawn under Letters of Credit, payments for early termination of Hedge Agreements, fees, expenses, indemnification or otherwise.

 

“Obligee Guarantor” has the meaning set forth in Section 7.07.

 

“Offer” has the meaning set forth in Section 2.13(c).

 

“Offer Loans” has the meaning set forth in Section 2.13(c).

 

 

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“Organizational Documents” means with respect to any Person all formation, organizational and governing documents, instruments and agreements, including (i) with respect to any corporation, its certificate or articles of incorporation or organization and its by-laws, (ii) with respect to any limited partnership, its certificate of limited partnership and its partnership agreement, (iii) with respect to any general partnership, its partnership agreement and (iv) with respect to any limited liability company, its articles of organization and its operating agreement.  In the event any term or condition of this Agreement or any other Loan Document requires any Organizational Document to be certified by a secretary of state or similar governmental official, the reference to any such “Organizational Document” shall only be to a document of a type customarily certified by such governmental official.

 

“Other Taxes” means any and all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies (and interest, fines, penalties and additions related thereto) arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

 

“Participant Register” has the meaning set forth in Section 10.06(g)(iv).

 

“PATRIOT Act” has the meaning set forth in Section 3.01(s).

 

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

 

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to Section 412 or Section 430 of the Internal Revenue Code or Section 302 of ERISA.

 

“Perfection Certificate” means a certificate in form satisfactory to the Collateral Agent that provides information with respect to the personal or mixed property of each Loan Party.

 

“Permits” means any permit, provider number, approval, authorization, license, registration, accreditation, certification, certificate of authority, variance, permission, franchise, qualification, order, filing or consent required from a Governmental Authority or other Person under an applicable Requirement of Law.

 

“Permitted Acquisition” means any acquisition by the Borrower or any Wholly-Owned Subsidiary Guarantor, whether by purchase, merger or otherwise, of all or substantially all of the assets of, all of the Equity Interests of, or a business line or unit or a division of, any Person; provided, that:

 

(i)            immediately prior to, and after giving effect thereto, (x) no Default or Event of Default shall have occurred and be continuing or would result therefrom and (y) the representations and warranties contained herein shall be true and correct in all material respects, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date; provided, that to the extent any such representation or warranty is already qualified by materiality or material adverse effect, such representation or warranty shall be true and correct in all respects.

 

 

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(ii)           all transactions in connection therewith shall be consummated, in all material respects, in accordance with all applicable laws and in conformity with all applicable Governmental Authorizations;

 

(iii)          in the case of the acquisition of Equity Interests, all of the Equity Interests (except for any such Securities in the nature of directors’ qualifying shares required pursuant to applicable law) acquired or otherwise issued by such Person or any newly formed Subsidiary of the Borrower in connection with such acquisition shall be owned 100.0% by the Borrower or a Subsidiary Guarantor thereof, and the Borrower shall have taken, or caused to be taken, as of the date such Person becomes a Subsidiary of the Borrower, each of the actions set forth in Sections 5.10 and/or 5.11, as applicable;

 

(iv)          Holdings and its Subsidiaries shall be in compliance with the financial covenants set forth in Section 6.07 on a pro forma basis after giving effect to such acquisition as of the last day of the Fiscal Quarter most recently ended (as determined in accordance with the definition of Consolidated Adjusted EBITDA);

 

(v)           the Borrower shall have delivered to the Administrative Agent (A) at least 10 Business Days prior to such proposed acquisition, (i) a Compliance Certificate evidencing compliance with Section 6.07 as required under clause (iv) above and (ii) all other relevant financial information with respect to such acquired assets, including the aggregate Acquisition Consideration for such acquisition and any other information required to demonstrate compliance with Section 6.07 and (B) promptly upon request by the Administrative Agent, (i) a copy of the purchase agreement related to the proposed Permitted Acquisition (and any related documents reasonably requested by the Administrative Agent) and (ii) quarterly and annual financial statements of the Person whose Equity Interests or assets are being acquired for the twelve-month period immediately prior to such proposed Permitted Acquisition, including any audited financial statements that are available;

 

(vi)          any Person or assets or division as acquired in accordance herewith (y) shall be in same business or lines of business (or a Person that owns or develops software used in the business of Holdings and its Subsidiaries) in which the Borrower and/or its Subsidiaries are engaged as of the Closing Date or any business that is similar, reasonably related, incidental or ancillary thereto and (z) other than with respect to such Permitted Acquisitions the Acquisition Consideration with respect thereto is less than $15,000,000 during the term of this Agreement, shall have generated positive cash flow for the four-quarter period most recently ended prior to the date of such acquisition;

 

(vii)         such acquisition shall be consensual and shall have been approved by the target’s board of directors; and

 

 

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(viii)        the aggregate unused portion of the Revolving Commitments at such time (after giving effect to the consummation of the respective acquisition and any financing thereof) shall equal or exceed $20,000,000.

 

“Permitted Refinancing” means, with respect to any Person, any modification, refinancing, refunding, renewal or extension of any Indebtedness of such Person; provided, that (a) the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so modified, refinanced, refunded, renewed or extended except by an amount equal to unpaid accrued interest and premium thereon plus other reasonable amounts paid, and fees and expenses reasonably incurred, in connection with such modification, refinancing, refunding, renewal or extension and by an amount equal to any existing commitments unutilized thereunder; (b) such modification, refinancing, refunding, renewal or extension has a final maturity date equal to or later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being modified, refinanced, refunded, renewed or extended (except by virtue of amortization of or prepayment of Indebtedness prior to such date of determination); (c) at the time thereof, no Default or Event of Default shall have occurred and be continuing; (d) to the extent such Indebtedness being modified, refinanced, refunded, renewed or extended is subordinated in right of payment to the Obligations, such modification, refinancing, refunding, renewal or extension is subordinated in right of payment to the Obligations on terms at least as favorable to the Lenders as those contained in the documentation governing the Indebtedness being modified, refinanced, refunded, renewed or extended; (e) the original obligors in respect of such Indebtedness being modified, refinanced, refunded, renewed or extended remain the only obligors thereon; and (f) the terms and conditions of any such modification, refinancing, refunding, renewal or extension, taken as a whole, are not materially less favorable to the Lenders than the terms and conditions of the Indebtedness being modified, refinanced, refunded, renewed or extended.

 

“Permitted Liens” means each of the Liens permitted pursuant to Section 6.02.

 

“Person” means and includes natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability partnerships, joint stock companies, Joint Ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and Governmental Authorities.

 

“Platform” has the meaning set forth in Section 5.01(m).

 

“Pledge and Security Agreement” means the Pledge and Security Agreement to be executed by the Borrower and each Guarantor substantially in the form of Exhibit I, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

“Prime Rate” means the rate of interest quoted in The Wall Street Journal, Money Rates Section as the Prime Rate (currently defined as the base rate on corporate loans posted by at least 75.0% of the nation’s thirty (30) largest banks), as in effect from time to time.  The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  The Administrative Agent or any other Lender may make commercial loans or other loans at rates of interest at, above or below the Prime Rate.

 

 

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“Principal Office” means, for each of the Administrative Agent, the Swing Line Lender and the Issuing Bank, such Person’s “Principal Office” as set forth on Schedule 1.01(c), or such other office or office of a third party or sub-agent, as appropriate, as such Person may from time to time designate in writing to the Borrower, the Administrative Agent and each  Lender.

 

“Projections” has the meaning set forth in Section 4.08.

 

“ProNet” means, ProNet Imaging Medical Group, Inc., a California corporation.

 

“Pro Rata Share” means (i) with respect to all payments, computations and other matters relating to the Tranche B Term Loan of any Lender, the percentage obtained by dividing (a) the Tranche B Term Loan Exposure of that Lender by (b) the aggregate Tranche B Term Loan Exposure of all Lenders; (ii) with respect to all payments, computations and other matters relating to the Revolving Commitment or Revolving Loans of any Lender or any Letters of Credit issued or participations purchased therein by any Lender or any participations in any Swing Line Loans purchased by any Lender, the percentage obtained by dividing (a) the Revolving Exposure of that Lender by (b) the aggregate Revolving Exposure of all Lenders; and (iii) with respect to all payments, computations, and other matters relating to Incremental Term Loan Commitments or Incremental Term Loans of a particular Series, the percentage obtained by dividing (a) the Incremental Term Loan Exposure of that Lender with respect to that Series by (b) the aggregate Incremental Term Loan Exposure of all Lenders with respect to that Series.  For all other purposes with respect to each Lender, “Pro Rata Share” means the percentage obtained by dividing (A) an amount equal to the sum of the Tranche B Term Loan Exposure, the Revolving Exposure and the Incremental Term Loan Exposure of that Lender, by (B) an amount equal to the sum of the aggregate Tranche B Term Loan Exposure, the aggregate Revolving Exposure and the aggregate Incremental Term Loan Exposure of all Lenders.

 

“RBC Capital” means, RBC Capital Markets.2

 

“Real Estate Asset” means, at any time of determination, any interest (fee, leasehold or otherwise) then owned by any Loan Party in any real property.

 

“Refunded Swing Line Loans” has the meaning set forth in Section 2.03(b)(iv).

 

“Register” has the meaning set forth in Section 2.07(b).

 

“Regulation D” means Regulation D of the Board of Governors, as in effect from time to time.

 

2   RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

 

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“Regulation FD” means Regulation FD as promulgated by the SEC under the Securities Act and Exchange Act.

 

“Regulation U” means Regulation U of the Board of Governors, as in effect from time to time.

 

“Reimbursement Date” has the meaning set forth in Section 2.04(d).

 

“Related Acquisitions” means, those acquisitions described under the heading “recent developments” in the confidential offering memorandum with respect to the Senior Notes.

 

“Related Fund” means, with respect to any Lender that is an investment fund, any other investment fund that invests in commercial loans and that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

 

“Release” means any release, spill, emission, leaking, pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching or migration of any Hazardous Material into the indoor or outdoor environment (including the abandonment or disposal of any barrels, containers or other closed receptacles containing any Hazardous Material), including the movement of any Hazardous Material through the air, soil, surface water or groundwater.

 

“Replacement Lender” has the meaning set forth in Section 2.23.

 

“Required Lenders” means one or more Lenders having or holding Tranche B Term Loan Exposure, Incremental Term Loan Exposure and/or Revolving Exposure and representing more than 50.0% of the sum of (i) the aggregate Tranche B Term Loan Exposure of all Lenders, (ii) the aggregate Revolving Exposure of all Lenders and (iii) the aggregate Incremental Term Loan Exposure of all Lenders.  For purposes of this definition, Required Lenders shall be determined by excluding all Loans and Commitments held by a Defaulting Lender.

 

“Requirements of Law” means, as to any Person, the governing documents of such Person, and any law, ordinance, policy, manual provision, guidance, principle of common law, statute, rule or regulation, or determination of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its assets or to which such Person or any of its assets is subject including, without limitation, the Securities Act, the Exchange Act, Regulations T, U and X of the Board of Governors, ERISA, the Fair Labor Standards Act, the Worker Adjustment and Retraining Notification Act, Americans with Disabilities Act of 1990, the Social Security Act, any Health Care Law, Environmental Law, and any certificate of occupancy, zoning ordinance, building, environmental or land use requirement or Permit or environmental, labor, employment, occupational safety or health law, rule or regulation, including environmental, health or safety laws (including, without limitation, those applicable to the disposal of medical waste).

 

 

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“Restricted Junior Payment” means (i) any dividend or other distribution, direct or indirect, on account of any shares of any class of stock of Holdings, the Borrower or any of their respective Subsidiaries (or any direct or indirect parent of the Borrower or Holdings) now or hereafter outstanding, except a dividend payable solely in shares of that class of stock to the holders of that class; (ii) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any shares of any class of stock of Holdings or the Borrower or any of their respective Subsidiaries (or any direct or indirect parent thereof) now or hereafter outstanding; (iii) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire shares of any class of stock of any Loan Party or any of their respective Subsidiaries (or any direct or indirect parent of any Loan Party) now or hereafter outstanding; and (iv) any payment or prepayment of principal of, premium, if any, or interest on, or redemption, purchase, retirement, defeasance (including in substance or legal defeasance), sinking fund or similar payment with respect to, the Senior Notes or any Indebtedness permitted under Section 6.01(c).

 

“Revolving Commitment” means the commitment of a Lender to make or otherwise fund any Revolving Loan and to acquire participations in Letters of Credit and Swing Line Loans hereunder and “Revolving Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Revolving Commitment, if any, is set forth on Schedule 1.01(b) or in the applicable Assignment Agreement or Joinder Agreement, as applicable, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Revolving Commitments as of the Closing Date is $100,000,000.00.

 

“Revolving Commitment Period” means the period from the Closing Date to but excluding the Revolving Commitment Termination Date.

 

“Revolving Commitment Termination Date” means the earliest to occur of (i) the fifth anniversary of the Closing Date, (ii) the date the Revolving Commitments are permanently reduced to zero pursuant to Section 2.13(b) and (iii) the date of the termination of the Revolving Commitments pursuant to Section 8.01.

 

“Revolving Exposure” means, with respect to any Lender as of any date of determination, (i) prior to the termination of the Revolving Commitments, that Lender’s Revolving Commitment; and (ii) after the termination of the Revolving Commitments, the sum of (a) the aggregate outstanding principal amount of the Revolving Loans of that Lender, (b) in the case of the Issuing Bank, the aggregate Letter of Credit Usage in respect of all Letters of Credit issued by the Issuing Bank (net of any participations by Lenders in such Letters of Credit),  (c) the aggregate amount of all participations by that Lender in any outstanding Letters of Credit or any unreimbursed drawing under any Letter of Credit, (d) in the case of Swing Line Lender, the aggregate outstanding principal amount of all Swing Line Loans (net of any participations therein by other Lenders), and (e) the aggregate amount of all participations therein by that Lender in any outstanding Swing Line Loans.

 

“Revolving Lender” means a Lender that makes a Revolving Loan.

 

“Revolving Loan” means a Loan made by a Lender to the Borrower pursuant to Section 2.02(a) and/or Section 2.24.

 

 

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“Revolving Loan Note” means a promissory note in the form of Exhibit B-2, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

“S&P” means Standard & Poor’s, a Division of The McGraw-Hill Companies, Inc.

 

“SEC” means the United States Securities and Exchange Commission and any successor Governmental Authority performing a similar function.

 

“Secured Parties” has the meaning set forth in the Pledge and Security Agreement.

 

“Securities” means any stock, shares, partnership interests, voting trust certificates, certificates of interest or participation in any profit-sharing agreement or arrangement, options, warrants, bonds, debentures, notes, or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “securities” or any certificates of interest, shares or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing.

 

“Securities Account” has the meaning set forth in the UCC.

 

“Securities Account Control Agreement” has the meaning set forth in the Pledge and Security Agreement.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time, and any successor statute.

 

“Security Documents” means the Pledge and Security Agreement, the Mortgages, the Intellectual Property Security Agreements, the Landlord Personal Property Collateral Access Agreements, if any, and all other instruments, documents and agreements delivered by any Loan Party pursuant to this Agreement or any of the other Loan Documents in order to grant to the Collateral Agent, for the benefit of Secured Parties, a Lien on any assets or property of that Loan Party as security for the Obligations, including UCC financing statements and amendments thereto and filings with the U.S. Patent and Trademark Office and the U.S. Copyright Office.

 

“Series” has the meaning set forth in Section 2.24.

 

“Senior Notes” means $210,000,000 in aggregate principal amount of the Borrower’s senior unsecured notes due 2018.

 

“Senior Notes Indenture” means the Indenture for the Senior Notes, dated as of the date hereof.

 

“Senior Notes Documents” means the Senior Notes, the Senior Notes Indenture, and all other instruments, agreements and other documents evidencing or governing the Senior Notes or providing for any guarantee or other right in respect thereof.

 

 

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“Senior Notes Offering” means the offering by the Borrower of the Senior Notes pursuant to a registered public offering or Rule 144A or other private placement.

 

“Senior Unsecured Incurrence Test” means, the Leverage Ratio, as of the applicable test date, shall be no greater than 4.65:1.00.

 

“Significant Subsidiary” manes any Subsidiary of the Borrower that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Closing Date.

 

“Solvency Certificate” means a Solvency Certificate of the chief financial officer of Holdings substantially in the form of Exhibit G-2.

 

“Solvent” means, with respect to any Loan Party, that as of the date of determination, both (i) (a) the sum of such Loan Party’s debt (including contingent liabilities) does not exceed the present fair saleable value of such Loan Party’s present assets; (b) such Loan Party’s capital is not unreasonably small in relation to its business as contemplated on the Closing Date and reflected in the Projections or with respect to any transaction contemplated to be undertaken after the Closing Date; and (c) such Person has not incurred and does not intend to incur, or believe (nor should it reasonably believe) that it will incur, debts beyond its ability to pay such debts as they become due (whether at maturity or otherwise); and (ii) such Person is “solvent” within the meaning given that term and similar terms under the Bankruptcy Code and applicable laws relating to fraudulent transfers and conveyances.  For purposes of this definition, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5).

 

“Subject Transaction” has the meaning set forth in the definition of Consolidated Adjusted EBITDA.

 

“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity of which more than 50.0% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, but excluding any Majority-Owned Joint Venture; provided, that in determining the percentage of ownership interests of any Person controlled by another Person, no ownership interest in the nature of a “qualifying share” of the former Person shall be deemed to be outstanding.

 

“Subsidiary Guarantor” means each Guarantor other than Holdings, Beverly, Beverly Radiology, Breastlink and ProNet.

 

 

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“Swing Line Commitment” means the obligation of the Swing Line Lender to make Swing Line Loans and of each Lender having a Revolving Commitment to participate in Swing Line Loans pursuant to Section 2.03.

 

“Swing Line Lender” means Barclays Bank PLC in its capacity as the Swing Line Lender hereunder, together with its permitted successors and assigns in such capacity.

 

“Swing Line Loan” means a Loan made by the Swing Line Lender to the Borrower pursuant to Section 2.03.

 

“Swing Line Note” means a promissory note in the form of Exhibit B-3, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

“Swing Line Sublimit” means the lesser of (i) $10,000,000 and (ii) the aggregate unused amount of Revolving Commitments then in effect.

 

“Tax” means any present or future tax, levy, impost, duty, assessment, charge, fee, deduction or withholding (and interest, fines, penalties and additions related thereto) of any nature and whatever called, by whomsoever, on whomsoever and wherever imposed, levied, collected, withheld or assessed; provided, that, “Tax on the overall net income” of a Person shall be construed as a reference to a tax imposed by the jurisdiction in which that Person is organized or in which that Person’s applicable principal office (and/or, in the case of a Lender, its lending office) is located or in which that Person (and/or, in the case of a Lender, its lending office) is deemed to be doing business (other than solely as a result of entering into this Agreement, holding a Loan or Commitment, receiving payments in connection therewith and/or exercising rights and remedies thereunder) on all or part of the net income, profits or gains (whether worldwide, or only insofar as such income, profits or gains are considered to arise in or to relate to a particular jurisdiction, or otherwise) of that Person (and/or, in the case of a Lender, its applicable lending office).

 

“Term Loan” means a Tranche B Term Loan and an Incremental Term Loan.

 

“Term Lenders” means the Lenders having Tranche B Term Loan Exposure and the Lenders having Incremental Term Loan Exposure of each applicable Series.

 

“Term Loan Commitment” means the Tranche B Term Loan Commitment or the Incremental Term Loan Commitment of a Lender, and “Term Loan Commitments” means such commitments of all Lenders.

 

“Term Loan Maturity Date” means the Tranche B Term Loan Maturity Date and the Incremental Term Loan Maturity Date of any Series of Incremental Term Loans.

 

“Terminated Lender” has the meaning set forth in Section 2.23.

 

“Total Utilization of Revolving Commitments” means, as at any date of determination, the sum of (i) the aggregate principal amount of all outstanding Revolving Loans (other than Revolving Loans made for the purpose of repaying any Refunded Swing Line Loans or reimbursing the Issuing Bank for any amount drawn under any Letter of Credit, but not yet so applied), (ii) the aggregate principal amount of all outstanding Swing Line Loans and (iii) the Letter of Credit Usage.

 

 

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 “Tranche B Term Loan” means a Tranche B Term Loan made by a Lender to the Borrower pursuant to Section 2.01(a)(i).

 

“Tranche B Term Loan Commitment” means the commitment of a Lender to make or otherwise fund a Tranche B Term Loan and “Tranche B Term Loan Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Tranche B Term Loan Commitment, if any, is set forth on Schedule 1.01(a) or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Tranche B Term Loan Commitments as of the Closing Date is $285,000,000.

 

“Tranche B Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Tranche B Term Loans of such Lender; provided, that at any time prior to the making of the Tranche B Term Loans, the Tranche B Term Loan Exposure of any Lender shall be equal to such Lender’s Tranche B Term Loan Commitment.

 

“Tranche B Term Loan Maturity Date” means the earlier of (i) the sixth anniversary of the Closing Date and (ii) the date on which all Tranche B Term Loans shall become due and payable in full hereunder, whether by acceleration or otherwise.

 

“Tranche B Term Loan Note” means a promissory note in the form of Exhibit B-1, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

“Transactions” means the borrowing of Loans by the Borrower under this Agreement contemplated to be funded on the Closing Date, the issuance of the Senior Notes, the repayment of the Existing Indebtedness, the consummation of the Related Acquisitions (it being understood that such acquisitions will be consummated after the Closing Date and are expressly permitted hereunder) and the payment of fees and expenses incurred in connection with the foregoing.

 

“Transaction Costs” means the fees, costs and expenses payable by Holdings, the Borrower or any of the Borrower’s Subsidiaries on or before the Closing Date in connection with the transactions contemplated by the Loan Documents and the Senior Notes Documents.

 

“Type of Loan” means (i) with respect to either Term Loans or Revolving Loans, a Base Rate Loan or a Eurodollar Rate Loan and (ii) with respect to Swing Line Loans, a Base Rate Loan.

 

“UCC” means the Uniform Commercial Code (or any similar or equivalent legislation) as in effect in any applicable jurisdiction.

 

 

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“Unadjusted Eurodollar Rate Component” means that component of the interest costs to the Borrower in respect of a Eurodollar Rate Loan that is based upon the rate obtained pursuant to clause (i) of the definition of Adjusted Eurodollar Rate.

 

“U.S. Lender” has the meaning set forth in Section 2.20(c).

 

“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:  (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (ii) the then outstanding principal amount of such Indebtedness.

 

“Wholly-Owned Subsidiary” means, with respect to any Person, any other Person all of the Equity Interests of which (other than (x) directors’ qualifying shares and (y) shares issued to foreign nationals to the extent required by applicable law) are owned by such Person directly and/or through other wholly-owned Subsidiaries of such Person.

 

“Wholly-Owned Subsidiary Guarantor” means any Subsidiary Guarantor that is a Wholly-Owned Subsidiary of the Borrower.

 

Section 1.02         Accounting Terms.Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP.  Financial statements and other information required to be delivered by Holdings to Lenders pursuant to Section 5.1(a), 5.1(b) and 5.1(c) shall be prepared in accordance with GAAP as in effect at the time of such preparation (and delivered together with the reconciliation statements provided for in Section 5.1(e), if applicable).  Subject to the foregoing, calculations in connection with the definitions, covenants and other provisions hereof shall utilize accounting principles and policies in conformity with those used to prepare the Historical Financial Statements.

 

Section 1.03         Interpretation, Etc.  Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference.  References herein to any Article, Section, Schedule or Exhibit shall be to an Article, a Section, a Schedule or an Exhibit, as the case may be, hereof unless otherwise specifically provided.  The use herein of the word “include” or “including”, when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that fall within the broadest possible scope of such general statement, term or matter. The word “will” shall be construed to have the same meaning and effect as the word “shall”; and the words “asset” and “property” shall be construed as having the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.  The terms lease and license shall include sub-lease and sub-license, as applicable.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  Except as otherwise expressly provided herein or therein, any reference in this Agreement or any other Loan Document to any agreement, document or instrument shall mean such agreement, document or instrument as amended, restated, supplemented or otherwise modified from time to time, in each case, in accordance with the express terms of this Agreement or such Loan Document.

 

 

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ARTICLE II.

LOANS AND LETTERS OF CREDIT

 

Section 2.01         Term Loans.

 

(a)          Loan Commitments.  Subject to the terms and conditions hereof, each Lender severally agrees to make, on the Closing Date, a Tranche B Term Loan to the Borrower in an amount equal to such Lender’s Tranche B Term Loan Commitment. The Borrower may make only one borrowing under the Tranche B Term Loan Commitment which shall be on the Closing Date.  Any amount borrowed under this Section 2.01(a) and subsequently repaid or prepaid may not be reborrowed.  Subject to Sections 2.13(a) and 2.14, all amounts owed hereunder with respect to the Tranche B Term Loans shall be paid in full no later than the Tranche B Term Loan Maturity Date.  Each Lender’s Tranche B Term Loan Commitment shall terminate immediately and without further action on the Closing Date after giving effect to the funding of such Lender’s Tranche B Term Loan Commitment on such date.

 

(b)         Borrowing Mechanics for Term Loans.

 

(i)           the Borrower shall deliver to the Administrative Agent a fully executed Borrowing Notice no later than three (3) Business Days prior to the Closing Date.  Promptly upon receipt by the Administrative Agent of such Borrowing Notice, the Administrative Agent shall notify each Lender of the proposed borrowing.

 

(ii)           Each Lender shall make its Tranche B Term Loan available to the Administrative Agent not later than 12:00 p.m. (New York City time) on the Closing Date, by wire transfer of same day funds in Dollars, at the Principal Office designated by the Administrative Agent.  Upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of the Term Loans available to the Borrower on the Closing Date by causing an amount of same day funds in Dollars equal to the proceeds of all such Loans received by the Administrative Agent from Lenders to be credited to the account of the Borrower at the Principal Office designated by the Administrative Agent or to such other account as may be designated in writing to the Administrative Agent by the Borrower.

 

Section 2.02         Revolving Loans.

 

(a)          Revolving Commitments. During the Revolving Commitment Period, subject to the terms and conditions hereof, each Lender severally agrees to make Revolving Loans to the Borrower in an aggregate amount up to but not exceeding such Lender’s Revolving Commitment; provided, that after giving effect to the making of any Revolving Loans in no event shall the Total Utilization of Revolving Commitments exceed the Revolving Commitments then in effect.  Amounts borrowed pursuant to this Section 2.02(a) may be repaid and reborrowed during the Revolving Commitment Period.  Each Lender’s Revolving Commitment shall expire on the Revolving Commitment Termination Date and all Revolving Loans and all other amounts owed hereunder with respect to the Revolving Loans and the Revolving Commitments shall be paid in full no later than such date.

 

 

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(b)         Borrowing Mechanics for Revolving Loans.

 

(i)            Except pursuant to 2.04(d), Revolving Loans that are Base Rate Loans shall be made in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount, and Revolving Loans that are Eurodollar Rate Loans shall be in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount.

 

(ii)           Whenever the Borrower desires that Lenders make Revolving Loans, the Borrower shall deliver to the Administrative Agent a fully executed and delivered Borrowing Notice no later than 10:00 a.m. (New York City time) at least three (3) Business Days in advance of the proposed Credit Date in the case of a Eurodollar Rate Loan, and at least one Business Day in advance of the proposed Credit Date in the case of a Revolving Loan that is a Base Rate Loan.  Except as otherwise provided herein, a Borrowing Notice for a Revolving Loan that is a Eurodollar Rate Loan shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to make a borrowing in accordance therewith.

 

(iii)          Notice of receipt of each Borrowing Notice in respect of Revolving Loans, together with the amount of each Lender’s Pro Rata Share thereof, if any, together with the applicable interest rate, shall be provided by the Administrative Agent to each applicable Lender by telefacsimile with reasonable promptness, but (provided the Administrative Agent shall have received such notice by 10:00 a.m. (New York City time)) not later than 2:00 p.m. (New York City time) on the same day as the Administrative Agent’s receipt of such Notice from the Borrower.

 

(iv)          Each Lender shall make the amount of its Revolving Loan available to the Administrative Agent not later than 12:00 p.m. (New York City time) on the applicable Credit Date by wire transfer of same day funds in Dollars, at the Principal Office designated by the Administrative Agent.  Except as provided herein, upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of such Revolving Loans available to the Borrower on the applicable Credit Date by causing an amount of same day funds in Dollars equal to the proceeds of all such Revolving Loans received by the Administrative Agent from Lenders to be credited to the account of the Borrower at the Principal Office designated by the Administrative Agent or such other account as may be designated in writing to the Administrative Agent by the Borrower.

 

 

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Section 2.03         Swing Line Loans.

 

(a)          Swing Line Loans Commitments.  During the Revolving Commitment Period, subject to the terms and conditions hereof, Swing Line Lender may, from time to time in its discretion, agree to make Swing Line Loans to the Borrower in the aggregate amount up to but not exceeding the Swing Line Sublimit; provided, that after giving effect to the making of any Swing Line Loan, in no event shall the Total Utilization of Revolving Commitments exceed the Revolving Commitments then in effect.  Amounts borrowed pursuant to this Section 2.03 may be repaid and reborrowed during the Revolving Commitment Period.  Swing Line Lender’s Revolving Commitment shall expire on the Revolving Commitment Termination Date.  All Swing Line Loans and all other amounts owed hereunder with respect to the Swing Line Loans shall be paid on the earlier of (x) the date which is five days after the incurrence thereof and (y) the Revolving Commitment Termination Date.

 

(b)         Borrowing Mechanics for Swing Line Loans.

 

(i)            Swing Line Loans shall be made in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount.

 

(ii)           Whenever the Borrower desires that Swing Line Lender make a Swing Line Loan, the Borrower shall deliver to the Administrative Agent a Borrowing Notice no later than 12:00 p.m. (New York City time) on the proposed Credit Date.

 

(iii)          Swing Line Lender shall make the amount of its Swing Line Loan available to the Administrative Agent not later than 2:00 p.m. (New York City time) on the applicable Credit Date by wire transfer of same day funds in Dollars, at the Administrative Agent’s Principal Office.  Except as provided herein, upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of such Swing Line Loans available to the Borrower on the applicable Credit Date by causing an amount of same day funds in Dollars equal to the proceeds of all such Swing Line Loans received by the Administrative Agent from Swing Line Lender to be credited to the account of the Borrower at the Administrative Agent’s Principal Office, or to such other account as may be designated in writing to the Administrative Agent by the Borrower.

 

(iv)          With respect to any Swing Line Loans which have not been voluntarily prepaid by the Borrower pursuant to Section 2.13, Swing Line Lender may at any time in its sole and absolute discretion, deliver to the Administrative Agent (with a copy to the Borrower), no later than 11:00 a.m. (New York City time) at least one Business Day in advance of the proposed Credit Date, a notice (which shall be deemed to be a Borrowing Notice given by the Borrower) requesting that each Lender holding a Revolving Commitment make Revolving Loans that are Base Rate Loans to the Borrower on such Credit Date in an amount equal to the amount of such Swing Line Loans (the “Refunded Swing Line Loans”) outstanding on the date such notice is given which Swing Line Lender requests Lenders to prepay.  Anything contained in this Agreement to the contrary notwithstanding, (1) the proceeds of such Revolving Loans made by the Lenders other than Swing Line Lender shall be immediately delivered by the Administrative Agent to Swing Line Lender (and not to the Borrower) and applied to repay a corresponding portion of the Refunded Swing Line Loans and (2) on the day such Revolving Loans are made, Swing Line Lender’s Pro Rata Share of the Refunded Swing Line Loans shall be deemed to be paid with the proceeds of a Revolving Loan made by Swing Line Lender to the Borrower, and such portion of the Swing Line Loans deemed to be so paid shall no longer be outstanding as Swing Line Loans and shall no longer be due under the Swing Line Note of Swing Line Lender but shall instead constitute part of Swing Line Lender’s outstanding Revolving Loans to the Borrower and shall be due under the Revolving Loan Note issued by the Borrower to Swing Line Lender.  The Borrower hereby authorizes the Administrative Agent and Swing Line Lender to charge the Borrower’s accounts with the Administrative Agent and Swing Line Lender (up to the amount available in each such account) in order to immediately pay Swing Line Lender the amount of the Refunded Swing Line Loans to the extent the proceeds of such Revolving Loans made by Lenders, including the Revolving Loans deemed to be made by Swing Line Lender, are not sufficient to repay in full the Refunded Swing Line Loans.  If any portion of any such amount paid (or deemed to be paid) to Swing Line Lender should be recovered by or on behalf of the Borrower from Swing Line Lender in bankruptcy, by assignment for the benefit of creditors or otherwise, the loss of the amount so recovered shall be ratably shared among all Lenders in the manner contemplated by Section 2.17.

 

 

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(v)           If for any reason Revolving Loans are not made pursuant to Section 2.03(b)(iv) in an amount sufficient to repay any amounts owed to Swing Line Lender in respect of any outstanding Swing Line Loans on or before the third Business Day after demand for payment thereof by Swing Line Lender, each Lender holding a Revolving Commitment shall be deemed to, and hereby agrees to, have purchased a participation in such outstanding Swing Line Loans, and in an amount equal to its Pro Rata Share of the applicable unpaid amount together with accrued interest thereon.  Upon one Business Day’s notice from Swing Line Lender, each Lender holding a Revolving Commitment shall deliver to Swing Line Lender an amount equal to its respective participation in the applicable unpaid amount in same day funds at the Principal Office of Swing Line Lender. In order to evidence such participation each Lender holding a Revolving Commitment agrees to enter into a participation agreement at the request of Swing Line Lender in form and substance reasonably satisfactory to Swing Line Lender.  In the event any Lender holding a Revolving Commitment fails to make available to Swing Line Lender the amount of such Lender’s participation as provided in this paragraph, Swing Line Lender shall be entitled to recover such amount on demand from such Lender together with interest thereon for three (3) Business Days at the rate customarily used by Swing Line Lender for the correction of errors among banks and thereafter at the Base Rate, as applicable.

 

(vi)          Notwithstanding anything contained herein to the contrary, (1) each Lender’s obligation to make Revolving Loans for the purpose of repaying any Refunded Swing Line Loans pursuant to the second preceding paragraph and each Lender’s obligation to purchase a participation in any unpaid Swing Line Loans pursuant to the immediately preceding paragraph shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against Swing Line Lender, any Loan Party or any other Person for any reason whatsoever; (B) the occurrence or continuation of a Default or Event of Default; (C) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of any Loan Party; (D) any breach of this Agreement or any other Loan Document by any party thereto; or (E) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing; provided, that such obligations of each Lender are subject to the condition that Swing Line Lender had not received prior notice from the Borrower or the Required Lenders that any of the conditions under Section 3.02 to the making of the applicable Refunded Swing Line Loans or other unpaid Swing Line Loans were not satisfied at the time such Refunded Swing Line Loans or unpaid Swing Line Loans were made; and (2) Swing Line Lender shall not be obligated to make any Swing Line Loans (A) if it has elected not to do so after the occurrence and during the continuation of a Default or Event of Default, (B) it does not in good faith believe that all conditions under Section 3.02 to the making of such Swing Line Loan have been satisfied or waived by the Required Lenders or (C) if any of the Lenders is a Defaulting Lender but, in the case of this clause (C) only to the extent that (i) the Defaulting Lender’s participation in such Swing Line Loan may not be reallocated pursuant to clause (a) of Section 2.22 or (ii) other arrangements satisfactory to it and Borrower to eliminate such Swing Line Lender’s risk with respect to the Defaulting Lender’s participation in such Swing Line Loan (including cash collateralization by the Borrower of such Defaulting Lender’s pro rata share of the outstanding Swing Line Loans) have not been entered into.

 

 

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Section 2.04         Issuance of Letters of Credit and Purchase of Participations Therein.

 

(a)          Letters of Credit.  During the Revolving Commitment Period, subject to the terms and conditions hereof, the Issuing Bank agrees to issue Letters of Credit for the account of the Borrower in the aggregate amount up to but not exceeding the Letter of Credit Sublimit; provided, that (i) each Letter of Credit shall be denominated in Dollars; (ii) the stated amount of each Letter of Credit shall not be less than $100,000 or such lesser amount as is acceptable to the Issuing Bank; (iii) after giving effect to such issuance, in no event shall the Total Utilization of Revolving Commitments exceed the Revolving Commitments then in effect; (iv) after giving effect to such issuance, in no event shall the Letter of Credit Usage exceed the Letter of Credit Sublimit then in effect; (v) in no event shall any standby Letter of Credit have an expiration date later than the earlier of (1) five Business Days prior to the Revolving Commitment Termination Date and (2) the date which is one year from the date of issuance of such standby Letter of Credit; and (vi) in no event shall any commercial Letter of Credit (x) have an expiration date later than the earlier of (1) the Revolving Commitment Termination Date and (2) the date which is 180 days from the date of issuance of such commercial Letter of Credit or be issued if such commercial Letter of Credit is otherwise unacceptable to the Issuing Bank in its reasonable discretion.  Subject to the foregoing, the Issuing Bank may agree that a standby Letter of Credit shall automatically be extended for one or more successive periods not to exceed one year each, unless the Issuing Bank elects not to extend for any such additional period; provided, that the Issuing Bank shall not extend any such Letter of Credit if it has received written notice that an Event of Default has occurred and is continuing at the time the Issuing Bank must elect to allow such extension; provided, further, that in the event there is a Defaulting Lender, the Issuing Bank shall not be required to issue, renew or extend any Letter of Credit to the extent (x) the Defaulting Lender’s Pro Rata Share of Letter of Credit Commitment may not be reallocated pursuant to Section 2.22(a) or (y) the Issuing Bank has not otherwise entered into arrangements satisfactory to it and the Borrower to eliminate the Issuing Bank’s risk with respect to the participation in Letters of Credit of the Defaulting Lender, including by cash collateralizing such Defaulting Lender’s Pro Rata Share of the Letter of Credit Usage.

 

 

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(b)         Notice of Issuance.  Whenever the Borrower desires the issuance of a Letter of Credit, it shall deliver to the Administrative Agent an Issuance Notice no later than 12:00 p.m. (New York City time) at least three (3) Business Days (in the case of standby letters of credit) or five (5) Business Days (in the case of commercial letters of credit), or in each case such shorter period as may be agreed to by the Issuing Bank in any particular instance, in advance of the proposed date of issuance.  Upon satisfaction or waiver of the conditions set forth in Section 3.02, the Issuing Bank shall issue the requested Letter of Credit only in accordance with the Issuing Bank’s standard operating procedures.  Upon the issuance of any Letter of Credit or amendment or modification to a Letter of Credit, the Issuing Bank shall promptly notify each Lender with a Revolving Commitment of such issuance, which notice shall be accompanied by a copy of such Letter of Credit or amendment or modification to a Letter of Credit and the amount of such Lender’s respective participation in such Letter of Credit pursuant to Section 2.04(e).

 

(c)          Responsibility of the Issuing Bank With Respect to Requests for Drawings and Payments.  In determining whether to honor any drawing under any Letter of Credit by the beneficiary thereof, the Issuing Bank shall be responsible only to examine the documents delivered under such Letter of Credit with reasonable care so as to ascertain whether they appear on their face to be in accordance with the terms and conditions of such Letter of Credit.  As between the Borrower and the Issuing Bank, the Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit issued by the Issuing Bank by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the foregoing, the Issuing Bank shall not be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any such Letter of Credit to comply fully with any conditions required in order to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Bank, including any Governmental Acts; none of the above shall affect or impair, or prevent the vesting of, any of the Issuing Bank’s rights or powers hereunder.  Without limiting the foregoing and in furtherance thereof, no action taken or omitted by the Issuing Bank under or in connection with the Letters of Credit or any documents and certificates delivered thereunder, if taken or omitted in good faith, shall give rise to any liability on the part of the Issuing Bank to the Borrower.  Notwithstanding anything to the contrary contained in this Section 2.04(c), the Borrower shall retain any and all rights it may have against the Issuing Bank for any liability arising solely out of the gross negligence or willful misconduct of the Issuing Bank.

 

 

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(d)         Reimbursement by the Borrower of Amounts Drawn or Paid Under Letters of Credit.  In the event the Issuing Bank has determined to honor a drawing under a Letter of Credit, it shall immediately notify the Borrower and the Administrative Agent, and the Borrower shall reimburse the Issuing Bank on or before the Business Day immediately following the date on which such drawing is honored (the “Reimbursement Date”) in an amount in Dollars and in same day funds equal to the amount of such honored drawing; provided, that anything contained herein to the contrary notwithstanding, (i) unless the Borrower shall have notified the Administrative Agent and the Issuing Bank prior to 10:00 a.m. (New York City time) on the date such drawing is honored that the Borrower intends to reimburse the Issuing Bank for the amount of such honored drawing with funds other than the proceeds of Revolving Loans, the Borrower shall be deemed to have given a timely Borrowing Notice to the Administrative Agent requesting Lenders with Revolving Commitments to make Revolving Loans that are Base Rate Loans on the Reimbursement Date in an amount in Dollars equal to the amount of such honored drawing, and (ii) subject to satisfaction or waiver of the conditions specified in Section 3.02, Lenders with Revolving Commitments shall, on the Reimbursement Date, make Revolving Loans that are Base Rate Loans in the amount of such honored drawing, the proceeds of which shall be applied directly by the Administrative Agent to reimburse the Issuing Bank for the amount of such honored drawing; provided, further, that if for any reason proceeds of Revolving Loans are not received by the Issuing Bank on the Reimbursement Date in an amount equal to the amount of such honored drawing, the Borrower shall reimburse the Issuing Bank, on demand, in an amount in same day funds equal to the excess of the amount of such honored drawing over the aggregate amount of such Revolving Loans, if any, which are so received.  Nothing in this Section 2.04(d) shall be deemed to relieve any Lender with a Revolving Commitment from its obligation to make Revolving Loans on the terms and conditions set forth herein, and the Borrower shall retain any and all rights it may have against any such Lender resulting from the failure of such Lender to make such Revolving Loans under this Section 2.04(d).

 

(e)         Lenders’ Purchase of Participations in Letters of Credit.  Immediately upon the issuance of each Letter of Credit, each Lender having a Revolving Commitment shall be deemed to have purchased, and hereby agrees to irrevocably purchase, from the Issuing Bank a participation in such Letter of Credit and any drawings honored thereunder in an amount equal to such Lender’s Pro Rata Share (with respect to the Revolving Commitments) of the maximum amount which is or at any time may become available to be drawn thereunder.  In the event that the Borrower shall fail for any reason to reimburse the Issuing Bank as provided in Section 2.04(d), the Issuing Bank shall promptly notify each Lender with a Revolving Commitment of the unreimbursed amount of such honored drawing and of such Lender’s respective participation therein based on such Lender’s Pro Rata Share of the Revolving Commitments.  Each Lender with a Revolving Commitment shall make available to the Issuing Bank an amount equal to its respective participation, in Dollars and in same day funds, at the office of the Issuing Bank specified in such notice, not later than 12:00 p.m. (New York City time) on the first Business Day (under the laws of the jurisdiction in which such office of the Issuing Bank is located) after the date notified by the Issuing Bank.  In the event that any Lender with a Revolving Commitment fails to make available to the Issuing Bank on such business day the amount of such Lender’s participation in such Letter of Credit as provided in this Section 2.04(e), the Issuing Bank shall be entitled to recover such amount on demand from such Lender together with interest thereon for three (3) Business Days at the rate customarily used by the Issuing Bank for the correction of errors among banks and thereafter at the Base Rate.  Nothing in this Section 2.04(e) shall be deemed to prejudice the right of any Lender with a Revolving Commitment to recover from the Issuing Bank any amounts made available by such Lender to the Issuing Bank pursuant to this Section in the event that the payment with respect to a Letter of Credit in respect of which payment was made by such Lender constituted gross negligence or willful misconduct on the part of the Issuing Bank.  In the event the Issuing Bank shall have been reimbursed by other Lenders pursuant to this Section 2.04(e) for all or any portion of any drawing honored by the Issuing Bank under a Letter of Credit, the Issuing Bank shall distribute to each Lender which has paid all amounts payable by it under this Section 2.04(e) with respect to such honored drawing such Lender’s Pro Rata Share of all payments subsequently received by the Issuing Bank from the Borrower in reimbursement of such honored drawing when such payments are received.  Any such distribution shall be made to a Lender at its primary address set forth below its name on Schedule 1.01(c) or at such other address as such Lender may request.

 

 

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(f)          Obligations Absolute.  The obligation of the Borrower to reimburse the Issuing Bank for drawings honored under the Letters of Credit issued by it and to repay any Revolving Loans made by Lenders pursuant to Section 2.04(d) and the obligations of Lenders under Section 2.04(e) shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms hereof under all circumstances including any of the following circumstances: (i) any lack of validity or enforceability of any Letter of Credit; (ii) the existence of any claim, set-off, defense or other right which the Borrower or any Lender may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such transferee may be acting), the Issuing Bank, Lender or any other Person or, in the case of a Lender, against the Borrower, whether in connection herewith, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between the Borrower or one of its Subsidiaries and the beneficiary for which any Letter of Credit was procured); (iii) any draft or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iv) payment by the Issuing Bank under any Letter of Credit against presentation of a draft or other document which does not substantially comply with the terms of such Letter of Credit; (v) any adverse change in the business, general affairs, assets, liabilities, operations, management, condition (financial or otherwise), stockholders’ equity, results of operations or value of any Loan Party; (vi) any breach hereof or any other Loan Document by any party thereto; (vii) the fact that an Event of Default or a Default shall have occurred and be continuing; or (viii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing; provided that in each case payment by the Issuing Bank under the applicable Letter of Credit shall not have constituted gross negligence or willful misconduct of the Issuing Bank under the circumstances in question.

 

(g)         Indemnification.  Without duplication of any obligation of the Borrower under Section 10.02 or 10.03, in addition to amounts payable as provided herein, the Borrower hereby agrees to protect, indemnify, pay and save harmless the Issuing Bank from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel and allocated costs of internal counsel) which the Issuing Bank may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit by the Issuing Bank, other than as a result of (1) the gross negligence or willful misconduct of the Issuing Bank or (2) the wrongful dishonor by the Issuing Bank of a proper demand for payment made under any Letter of Credit issued by it or (ii) the failure of the Issuing Bank to honor a drawing under any such Letter of Credit as a result of any Governmental Act.

 

 

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Section 2.05         Pro Rata Shares; Availability of Funds.

 

(a)         Pro Rata Shares.  All Loans shall be made, and all participations purchased, by Lenders simultaneously and proportionately to their respective Pro Rata Shares, it being understood that no Lender shall be responsible for any default by any other Lender in such other Lender’s obligation to make a Loan requested hereunder or purchase a participation required hereby nor shall any Term Loan Commitment or any Revolving Commitment of any Lender be increased or decreased as a result of a default by any other Lender in such other Lender’s obligation to make a Loan requested hereunder or purchase a participation required hereby.

 

(b)         Availability of Funds.  Unless the Administrative Agent shall have been notified by any Lender prior to the applicable Credit Date that such Lender does not intend to make available to the Administrative Agent the amount of such Lender’s Loan requested on such Credit Date, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on such Credit Date and the Administrative Agent may, in its sole discretion, but shall not be obligated to, make available to the Borrower a corresponding amount on such Credit Date.  If such corresponding amount is not in fact made available to the Administrative Agent by such Lender, the Administrative Agent shall be entitled to recover such corresponding amount on demand from such Lender together with interest thereon, for each day from such Credit Date until the date such amount is paid to the Administrative Agent, at the customary rate set by the Administrative Agent for the correction of errors among banks for three (3) Business Days and thereafter at the Base Rate.  If such Lender does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent shall promptly notify the Borrower and the Borrower shall immediately pay such corresponding amount to the Administrative Agent together with interest thereon, for each day from such Credit Date until the date such amount is paid to the Administrative Agent, at the rate payable hereunder for Base Rate Loans for such Class of Loans.  Nothing in this Section 2.05(b) shall be deemed to relieve any Lender from its obligation to fulfill its Term Loan Commitment and Revolving Commitment hereunder or to prejudice any rights that the Borrower may have against any Lender as a result of any default by such Lender hereunder.

 

Section 2.06        Use of Proceeds. The proceeds of the Term Loans (excluding any Incremental Term Loan) made on the Closing Date shall be applied by the Borrower to fund the repayment of the Existing Indebtedness, to consummate the Related Acquisitions (it being understood that such acquisitions will be consummated after the Closing Date and are expressly permitted hereunder), to pay fees and expenses incurred in connection with the foregoing and to provide cash on the balance sheet of the Borrower. The proceeds of the Revolving Loans, Swing Line Loans and Letters of Credit made after the Closing Date shall be applied by the Borrower for working capital and general corporate purposes of the Borrower and its Subsidiaries, including Permitted Acquisitions.  The proceeds of the Incremental Term Loans shall be applied by the Borrower for general corporate purposes of the Borrower and its Subsidiaries, including Permitted Acquisitions.  No portion of the proceeds of any Credit Extension shall be used in any manner that causes or might cause such Credit Extension or the application of such proceeds to violate Regulation T, Regulation U or Regulation X of the Board of Governors or any other regulation thereof or to violate the Exchange Act.

 

 

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Section 2.07         Evidence of Debt; Register; Notes.

 

(a)          Lenders’ Evidence of Debt.  Each Lender shall maintain on its internal records an account or accounts evidencing the Obligations of the Borrower to such Lender, including the amounts of the Loans made by it and each repayment and prepayment in respect thereof.  Any such recordation shall be conclusive and binding on the Borrower, absent manifest error; provided, that the failure to make any such recordation, or any error in such recordation, shall not affect any Lender’s Revolving Commitment or the Borrower’s Obligations in respect of any Loans; provided, further, that in the event of any inconsistency between the Register and any Lender’s records, the recordations in the Register shall govern.

 

(b)         Register.  The Administrative Agent (or its agent or sub-agent appointed by it) shall maintain at its Principal Office a register for the recordation of the names and addresses of Lenders and the Revolving Commitment and Loans of each Lender from time to time (the “Register”).  The Register shall be available for inspection by the Borrower at any reasonable time and from time to time upon reasonable prior notice.  The Administrative Agent shall record, or shall cause to be recorded, in the Register the Revolving Commitments and the Loans in accordance with the provisions of Section 10.06, and each repayment or prepayment in respect of the principal amount of the Loans, and any such recordation shall be conclusive and binding on the Borrower and each Lender, absent manifest error; provided, that failure to make any such recordation, or any error in such recordation, shall not affect any Lender’s Revolving Commitment or the Borrower’s Obligations in respect of any Loan.  The Borrower hereby designates the Administrative Agent to serve as the Borrower’s agent solely for purposes of maintaining the Register as provided in this Section 2.07, and the Borrower hereby agrees that, to the extent the Administrative Agent serves in such capacity, the Administrative Agent and its officers, directors, employees, agents, sub-agents and affiliates shall constitute “Indemnitees.”

 

(c)         Notes.  If so requested by any Lender by written notice to the Borrower (with a copy to the Administrative Agent) at least two (2) Business Days prior to the Closing Date, or at any time thereafter, the Borrower shall execute and deliver to such Lender (and/or, if applicable and if so specified in such notice, to any Person who is an assignee of such Lender pursuant to Section 10.06) on the Closing Date (or, if such notice is delivered after the Closing Date, promptly after the Borrower’s receipt of such notice) a Note or Notes to evidence such Lender’s Tranche B Term Loan, Incremental Term Loan, Revolving Loan or Swing Line Loan, as the case may be.

 

Section 2.08         Interest on Loans.

 

(a)          Except as otherwise set forth herein, each Class of Loans shall bear interest on the unpaid principal amount thereof from the date made through repayment (whether by acceleration or otherwise) thereof as follows:

 

 

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(i)           in the case of Term Loans and Revolving Loans:

 

	
  

	
(A)

	
if a Base Rate Loan, at the Base Rate plus the Applicable Margin; or

 

	
  

	
(B)

	
if a Eurodollar Rate Loan, at the Adjusted Eurodollar Rate plus the Applicable Margin; and

 

(ii)          in the case of Swing Line Loans, at the Base Rate plus the Applicable Margin.

 

(b)         The basis for determining the rate of interest with respect to any Loan (except a Swing Line Loan which can be made and maintained as a Base Rate Loan only), and the Interest Period with respect to any Eurodollar Rate Loan, shall be selected by the Borrower and notified to the Administrative Agent and Lenders pursuant to the applicable Borrowing Notice or Conversion/Continuation Notice, as the case may be; provided, that until the date on which the Administrative Agent notifies the Borrower that the primary syndication of the Loans and Revolving Commitments has been completed, as determined by the Administrative Agent, the Term Loans shall be maintained as either (1) Eurodollar Rate Loans having an Interest Period of no longer than one month or (2) Base Rate Loans.  If on any day a Loan is outstanding with respect to which a Borrowing Notice or Conversion/Continuation Notice has not been delivered to the Administrative Agent in accordance with the terms hereof specifying the applicable basis for determining the rate of interest, then for that day such Loan shall be a Base Rate Loan.

 

(c)         In connection with Eurodollar Rate Loans there shall be no more than five (5) Interest Periods outstanding at any time.  In the event the Borrower fails to specify between a Base Rate Loan or a Eurodollar Rate Loan in the applicable Borrowing Notice or Conversion/Continuation Notice, such Loan (if outstanding as a Eurodollar Rate Loan) shall be automatically converted into a Base Rate Loan on the last day of the then-current Interest Period for such Loan (or if outstanding as a Base Rate Loan shall remain as, or (if not then outstanding) shall be made as, a Base Rate Loan).  In the event the Borrower fails to specify an Interest Period for any Eurodollar Rate Loan in the applicable Borrowing Notice or Conversion/Continuation Notice, the Borrower shall be deemed to have selected an Interest Period of one month.  As soon as practicable after 10:00 a.m. (New York City time) on each Interest Rate Determination Date, the Administrative Agent shall determine (which determination shall, absent manifest error, be final, conclusive and binding upon all parties) the interest rate that shall apply to the Eurodollar Rate Loans for which an interest rate is then being determined for the applicable Interest Period and shall promptly give notice thereof (in writing or by telephone confirmed in writing) to the Borrower and each Lender.

 

(d)         Interest payable pursuant to Section 2.08(a) shall be computed (i) in the case of Base Rate Loans on the basis of a 365-day or 366-day year, as the case may be and (ii) in the case of Eurodollar Rate Loans, on the basis of a 360-day year, in each case for the actual number of days elapsed in the period during which it accrues.  In computing interest on any Loan, the date of the making of such Loan or the first day of an Interest Period applicable to such Loan or, with respect to a Term Loan, the last Interest Payment Date with respect to such Term Loan or, with respect to a Base Rate Loan being converted from a Eurodollar Rate Loan, the date of conversion of such Eurodollar Rate Loan to such Base Rate Loan, as the case may be, shall be included, and the date of payment of such Loan or the expiration date of an Interest Period applicable to such Loan or, with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan, the date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as the case may be, shall be excluded; provided, that if a Loan is repaid on the same day on which it is made, one day’s interest shall be paid on that Loan.

 

 

48

 

 

(e)         Except as otherwise set forth herein, interest on each Loan (i) shall accrue on a daily basis and shall be payable in arrears on each Interest Payment Date with respect to interest accrued on and to each such payment date; (ii) shall accrue on a daily basis and shall be payable in arrears upon any prepayment of such Loan, whether voluntary or mandatory, to the extent accrued on the amount being prepaid; and (iii) shall accrue on a daily basis and shall be payable in arrears at maturity of such Loan, including final maturity of such Loan; provided, that with respect to any voluntary prepayment of a Base Rate Loan, accrued interest shall instead be payable on the applicable Interest Payment Date.

 

(f)          The Borrower agrees to pay to the Issuing Bank, with respect to drawings honored under any Letter of Credit, interest on the amount paid by the Issuing Bank in respect of each such honored drawing from the date such drawing is honored to but excluding the date such amount is reimbursed by or on behalf of the Borrower at a rate equal to (i) for the period from the date such drawing is honored to but excluding the applicable Reimbursement Date, the rate of interest otherwise payable hereunder with respect to Revolving Loans that are Base Rate Loans and (ii) thereafter, a rate which is 2.00% per annum in excess of the rate of interest otherwise payable hereunder with respect to Revolving Loans that are Base Rate Loans.

 

(g)         Interest payable pursuant to Section 2.08(f) shall be computed on the basis of a 365/366-day year for the actual number of days elapsed in the period during which it accrues, and shall be payable on demand or, if no demand is made, on the date on which the related drawing under a Letter of Credit is reimbursed in full.  Promptly upon receipt by the Issuing Bank of any payment of interest pursuant to Section 2.08(f), the Issuing Bank shall distribute to each Lender, out of the interest received by the Issuing Bank in respect of the period from the date such drawing is honored to but excluding the date on which the Issuing Bank is reimbursed for the amount of such drawing (including any such reimbursement out of the proceeds of any Revolving Loans), the amount that such Lender would have been entitled to receive in respect of the letter of credit fee that would have been payable in respect of such Letter of Credit for such period if no drawing had been honored under such Letter of Credit.  In the event the Issuing Bank shall have been reimbursed by Lenders for all or any portion of such honored drawing, the Issuing Bank shall distribute to each Lender which has paid all amounts payable by it under Section 2.04(e) with respect to such honored drawing such Lender’s Pro Rata Share of any interest received by the Issuing Bank in respect of that portion of such honored drawing so reimbursed by Lenders for the period from the date on which the Issuing Bank was so reimbursed by Lenders to but excluding the date on which such portion of such honored drawing is reimbursed by the Borrower.

 

 

49

 

 

Section 2.09         Conversion/Continuation.

 

(a)          Subject to Section 2.18 and so long as no Default or Event of Default shall have occurred and then be continuing, the Borrower shall have the option:

 

(i)           to convert at any time all or any part of any Term Loan or Revolving Loan equal to $500,000 and integral multiples of $100,000 in excess of that amount from one Type of Loan to another Type of Loan; provided, that a Eurodollar Rate Loan may only be converted on the expiration of the Interest Period applicable to such Eurodollar Rate Loan unless the Borrower shall pay all amounts due  under Section 2.18 in connection with any such conversion; or

 

(ii)           upon the expiration of any Interest Period applicable to any Eurodollar Rate Loan, to continue all or any portion of such Loan equal to $500,000 and integral multiples of $100,000 in excess of that amount as a Eurodollar Rate Loan.

 

(b)         The Borrower shall deliver a Conversion/Continuation Notice to the Administrative Agent no later than 10:00 a.m. (New York City time) at least one Business Day in advance of the proposed conversion date (in the case of a conversion to a Base Rate Loan) and at least three (3)  Business Days in advance of the proposed conversion/continuation date (in the case of a conversion to, or a continuation of, a Eurodollar Rate Loan).  Except as otherwise provided herein, a Conversion/Continuation Notice for conversion to, or continuation of, any Eurodollar Rate Loans shall be irrevocable on and after the related Interest Rate Determination Date, and the Borrower shall be bound to effect a conversion or continuation in accordance therewith.  The Administrative Agent shall promptly give each Lender written notice (or telephonic notice promptly confirmed in writing) of receipt of a Conversion/Continuation Notice and the matters covered by such Conversion/Continuation Notice.

 

Section 2.10        Default Interest. Upon the occurrence and during the continuance of an Event of Default under Section 8.1(a), (c) (in the case of a failure to perform or comply with any term or condition contained in Section 6.07), (f), (g) or (i) and, at the request of the Required Lenders, any other Event of Default, the principal amount of all Loans outstanding and, to the extent permitted by applicable law, any interest payments on the Loans or any fees or other amounts owed hereunder, shall thereafter bear interest (including post-petition interest in any proceeding under the Bankruptcy Code or other applicable bankruptcy laws) payable on demand at a rate (the “Default Rate”) that is 2.00% per annum in excess of the interest rate otherwise payable hereunder with respect to the applicable Loans (or, in the case of any such fees and other amounts, at a rate which is 2.00% per annum in excess of the interest rate otherwise payable hereunder for Base Rate Loans that are Revolving Loans) and such interest will be payable on demand; provided, that in the case of Eurodollar Rate Loans, upon the expiration of the Interest Period in effect at the time any such increase in interest rate is effective such Eurodollar Rate Loans shall thereupon become Base Rate Loans and shall thereafter bear interest payable upon demand at a rate which is 2.00% per annum in excess of the interest rate otherwise payable hereunder for Base Rate Loans.  Payment or acceptance of the increased rates of interest provided for in this Section 2.10 is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of the Administrative Agent or any Lender.

 

 

50

 

 

Section 2.11         Fees. The Borrower agrees to pay to Lenders having Revolving Exposure:

 

(i)           commitment fees equal to (1) the average of the daily difference between (a) the Revolving Commitments and (b) the aggregate principal amount of (x) all outstanding Revolving Loans plus (y) the Letter of Credit Usage, times (2) the Applicable Revolving Commitment Fee Percentage; provided, that (i) any commitment fee accrued with respect to any of the Revolving Commitments of a Defaulting Lender during the period prior to the time such Lender became a Defaulting Lender and unpaid at such time shall be payable by the Borrower so long as such commitment fee shall otherwise have been due and payable by the Borrower prior to such time of such Lender becoming a Defaulting Lender and (ii) no commitment fee shall accrue on any of the Revolving Commitments of a Defaulting Lender so long as such Lender shall be a Defaulting Lender; and

 

(ii)           letter of credit fees equal to (1) the Applicable Margin for Revolving Loans that are Eurodollar Rate Loans, times (2) the average aggregate daily maximum amount available to be drawn under all such Letters of Credit (regardless of whether any conditions for drawing could then be met and determined as of the close of business on any date of determination).

 

All fees referred to in this Section 2.11(a) shall be paid to the Administrative Agent at its Principal Office and upon receipt, the Administrative Agent shall promptly distribute to each Lender that has Revolving Exposure its Pro Rata Share thereof.

 

(b)          The Borrower agrees to pay directly to the Issuing Bank, for its own account, the following fees:

 

(i)            a fronting fee equal to 0.250%, per annum, times the average aggregate daily maximum amount available to be drawn under all Letters of Credit (determined as of the close of business on any date of determination); and

 

(ii)           such documentary and processing charges for any issuance, amendment, transfer or payment of a Letter of Credit as are in accordance with the Issuing Bank’s standard schedule for such charges and as in effect at the time of such issuance, amendment, transfer or payment, as the case may be.

 

(c)          All fees referred to in Section 2.11(a) and 2.11(b)(i) shall be calculated on the basis of a 360-day year and the actual number of days elapsed and shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year during the Revolving Commitment Period, commencing on the first such date to occur after the Closing Date, and on the Revolving Commitment Termination Date.

 

(d)         The Borrower agrees to pay on the Closing Date to each Lender party to this Agreement as a Lender on the Closing Date, as fee compensation for the funding of such Lender’s Loan and unfunded Revolving Commitments, a closing fee in an amount equal to 1.00% of the stated principal amount of such Lender’s Tranche B Term Loan and 2.00% of the stated principal amount of such Lender’s funded and unfunded Revolving Commitments (which shall include the face amount of any issued and undrawn Letters of Credit), payable to such Lender from the proceeds of its Loan as and when funded on the Closing Date.  Such closing fee shall be in all respects fully earned, due and payable on the Closing Date and non-refundable and non-creditable thereafter.

 

 

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(e)          In addition to any of the foregoing fees, the Borrower agrees to pay to Agents such other fees in the amounts and at the times separately agreed upon.

 

Section 2.12         Scheduled Payments/Commitment Reductions.  The principal amounts of the Tranche B Term Loans shall be repaid in consecutive quarterly installments (each, an “Installment” in the aggregate amounts set forth below on the dates set forth below (each, an “Installment Date”) commencing June 30, 2010:

 

	
Amortization Date

	 	
Tranche B Term Loan

Installments

	 
	
June 30, 2010

	 	$	712,500	 
	
September 30, 2010

	 	$	712,500	 
	
December 31, 2010

	 	$	712,500	 
	
March 31, 2011

	 	$	712,500	 
	
June 30, 2011

	 	$	712,500	 
	
September 30, 2011

	 	$	712,500	 
	
December 31, 2011

	 	$	712,500	 
	
March 31, 2012

	 	$	712,500	 
	
June 30, 2012

	 	$	712,500	 
	
September 30, 2012

	 	$	712,500	 
	
December 31, 2012

	 	$	712,500	 
	
March 31, 2013

	 	$	712,500	 
	
June 30, 2013

	 	$	712,500	 
	
September 30, 2013

	 	$	712,500	 
	
December 31, 2013

	 	$	712,500	 
	
March 31, 2014

	 	$	712,500	 
	
June 30, 2014

	 	$	712,500	 
	
September 30, 2014

	 	$	712,500	 
	
December 31, 2014

	 	$	712,500	 
	
March 31, 2015

	 	$	712,500	 
	
June 30, 2015

	 	$	712,500	 
	
September 30, 2015

	 	$	712,500	 
	
December 31, 2015

	 	$	712,500	 
	
March 31, 2016

	 	$	712,500	 
	
April 6, 2016

	 	$	267,900,000	 

 

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provided, that in the event any Incremental Term Loans are made, such Incremental Term Loans shall be repaid on each Installment Date occurring on or after the applicable Increased Amount Date in an amount equal to (i) the aggregate principal amount of Incremental Term Loans of the applicable Series of Incremental Term Loans, times (ii) the ratio (expressed as a percentage) of (y) the amount of all other Term Loans being repaid on such Installment Date and (z) the total aggregate principal amount of all other Term Loans outstanding on such Increased Amount Date.

 

Notwithstanding the foregoing, (x) such Installments shall be reduced in connection with any voluntary or mandatory prepayments of the Tranche B Term Loans in accordance with Sections 2.13, 2.14 and 2.15, as applicable; and (y) the Tranche B Term Loans, together with all other amounts owed hereunder with respect thereto, shall, in any event, be paid in full no later than the Tranche B Term Loan Maturity Date.

 

Section 2.13         Voluntary Prepayments/Commitment Reductions.

 

(a)          Voluntary Prepayments.

 

(i)            Any time and from time to time (1) with respect to Term Loans that are Base Rate Loans, the Borrower may prepay any such Loans on any Business Day, without premium or penalty in whole or in part, in an aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in excess of that amount; (2) with respect to Term Loans that are Eurodollar Rate Loans, the Borrower may prepay any such Loans only on the last day of the applicable interest period without premium or penalty, unless the Borrower pays any related breakage costs, as specified in Section 2.18(c), in whole or in part in an aggregate minimum amount of $1,000,000 and integral multiples of $100,000 in excess of that amount; (3) with respect to Revolving Loans that are Base Rate Loans, the Borrower may prepay such Loan on any Business Day, without premium or penalty in whole or in part, in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount; (4) with respect to Revolving Loans that are Eurodollar Rate Loans, the Borrower may prepay any such Loans only on the last day of the applicable interest period without premium or penalty, unless the Borrower pays any related breakage costs, as specified in Section 2.18(c), in whole or in part in an aggregate minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount; and (5) with respect to Swing Line Loans, the Borrower may prepay any such Loans on any Business Day in whole or in part in an aggregate minimum amount of $500,000, and in integral multiples of $100,000 in excess of that amount.

 

(ii)           All such prepayments shall be made (1) upon not less than one Business Day’s prior written notice in the case of Base Rate Loans; (2) upon not less than three (3) Business Days’ prior written notice in the case of Eurodollar Rate Loans; and (3) upon written notice on the date of prepayment, in the case of Swing Line Loans;

 

 

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in each case given to the Administrative Agent or Swing Line Lender, as the case may be, by 12:00 p.m. (New York City time) on the date required (and the Administrative Agent shall promptly transmit such original notice for Term Loans or Revolving Loans, as the case may be, by telefacsimile or telephone to each Lender).  Upon the giving of any such notice, the principal amount of the Loans specified in such notice shall become due and payable on the prepayment date specified therein.  Any such voluntary prepayment shall be applied as specified in Section 2.15(a).

 

(b)          Voluntary Commitment Reductions.

 

(i)            The Borrower may, upon not less than three (3) Business Days’ prior written notice confirmed in writing to the Administrative Agent (which original written notice the Administrative Agent shall promptly transmit by telefacsimile or telephone to each applicable Lender), at any time and from time to time terminate in whole or permanently reduce in part, without premium or penalty, the Revolving Commitments in an amount up to the amount by which the Revolving Commitments exceed the Total Utilization of Revolving Commitments at the time of such proposed termination or reduction; provided, that any such partial reduction of the Revolving Commitments shall be in an aggregate minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess of that amount.

 

(ii)           The Borrower’s notice to the Administrative Agent shall designate the date (which shall be a Business Day) of such termination or reduction and the amount of any partial reduction, and such termination or reduction of the Revolving Commitments shall be effective on the date specified in the Borrower’s notice and shall reduce the Revolving  Commitment of each Lender proportionately to its Pro Rata Share thereof.

 

(c)          Below-Par Purchases.  Notwithstanding anything to the contrary contained in this Section 2.13 or any other provision of this Agreement and without otherwise limiting the rights in respect of prepayments of the Loans of the Borrower and its Subsidiaries, so long as no Default or Event of Default has occurred and is continuing, the Borrower may repurchase outstanding Term Loans pursuant to this Section 2.13(c) on the following basis:

 

(i)            The Borrower may make one or more offers (each, an “Offer”) to repurchase all or any portion of the Term Loans (such Term Loans, the “Offer Loans”) of Term Lenders; provided that, (A) the Borrower delivers a notice of such Offer to the Administrative Agent and all Term Lenders no later than 12:00 Noon New York City time at least five Business Days in advance of a proposed consummation date of such Offer indicating (1) the last date on which such Offer may be accepted, (2) the maximum dollar amount of such Offer, and (3) the repurchase price per dollar of principal amount of such Offer Loans at which the Borrower is willing to repurchase such Offer Loans (which price shall be below par); (B) the maximum dollar amount of each Offer shall be no less than $10,000,000; (C) the Borrower shall hold such Offer open for a minimum period of two Business Days; (D) a Term Lender who elects to participate in the Offer may choose to sell all or part of such Term Lender’s Offer Loans; (E) such Offer shall be made to Term Lenders holding the Offer Loans on a pro rata basis in accordance with the respective principal amount then due and owing to the Term Lenders; provided, further that, if any Term Lender elects not to participate in the Offer, either in whole or in part, the amount of such Term Lender’s Offer Loans not being tendered shall be excluded in calculating the pro rata amount applicable to the balance of such Offer Loans and (F) such Offer shall be conducted pursuant to such procedures the Administrative Agent may establish in consultation with the Borrower (which shall be consistent with this Section 2.13(c)) and that a Lender must follow in order to have its Offer Loans repurchased, which procedures may include a requirement that that the Borrower represent and warrant that it does not have any material non-public information with respect to any Loan Party (or its Subsidiaries) that could be material to a Lender’s decision to participate in such Offer;

  

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(ii)           With respect to all repurchases made by the Borrower such repurchases shall be deemed to be voluntary prepayments pursuant to this Section 2.13 in an amount equal to the aggregate principal amount of such Term Loans, provided that such repurchases shall not be subject to the provisions of paragraphs (a) and (b) of this Section 2.13 or Section 2.17;

 

(iii)          Upon the purchase by the Borrower of any Term Loans, (A) automatically and without the necessity of any notice or any other action all principal and accrued and unpaid interest on the Term Loans so repurchased shall be deemed to have been paid for all purposes and shall be cancelled and no longer outstanding for all purposes of this Agreement and all other Loan Documents (and in connection with any Term Loan purchased pursuant to this Section 2.13(c), the Administrative Agent is authorized to make appropriate entries in the Register to reflect such cancellation) and (B) the Borrower will promptly advise the Administrative Agent of the total amount of Offer Loans that were repurchased from each Lender who elected to participate in the Offer;

 

(iv)          failure by Borrower to make any payment to a Lender required by an agreement permitted by this Section 2.13(c) shall not constitute an Event of Default under Section 8.1(a);

 

(v)           no proceeds of any Revolving Loans may be used to purchase any Offer Loans;

 

(vi)          after giving effect to each purchase of an Offer Loan, the sum of (1) the available Revolving Commitments of all Lenders and (2) all cash and Cash Equivalents not subject to any Lien (other than Liens in favor of the Collateral Agent) shall equal at least $35,000,000;

 

(vii)         after giving effect to all Offer Loans purchased and cancelled pursuant to this Section 2.13(c), the aggregate principal amount of all Term Loans so purchased and cancelled shall not exceed 25% of the sum of the original principal amount of the Term Loans; and

 

(viii)        the amount of such repurchases (based on the face value of the Term Loans purchased thereby) shall be applied on a pro rata basis to reduce the remaining Installments on the Term Loans pursuant to Section 2.12.

 

 

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(d)           Tranche B Term Loan Call Protection.  In the event that (i) all or any portion of the Tranche B Term Loan is repriced, effectively refinanced through any amendment of the Tranche B Term Loan or refinanced with the proceeds of other Indebtedness or (ii) a Term Lender is replaced as a result of the mandatory assignment of its Tranche B Term Loans in the circumstances described in Section 2.23 following the failure of such Term Lender to consent to an amendment of this Agreement that would have the effect of reducing the stated rate of interest with respect to the Tranche B Term Loans of such Term Lender, in each case, for any reason prior to the first anniversary of the Closing Date, such repricings, effective refinancings, refinancings or, solely with respect to such replaced Term Lender, mandatory assignments, will be made at 101.0% of the amount repriced, effectively refinanced, refinanced or mandatorily assigned.

 

Section 2.14          Mandatory Prepayments/Commitment Reductions.

 

(a)           Asset Sales.  No later than the first Business Day following the date of receipt by Holdings or any of its Subsidiaries of any Net Cash Proceeds in respect of any Asset Sale, the Borrower shall prepay the Loans as set forth in Section 2.15(b) in an aggregate amount equal to such Net Cash Proceeds; provided, that so long as no Default or Event of Default shall have occurred and be continuing at the time of the delivery of the notice described in the following clause or at the proposed time of the investment of such Net Cash Proceeds as described in the following clause, the Borrower shall have the option, upon written notice to the Administrative Agent, directly or through one or more of its Subsidiaries, to invest such Net Cash Proceeds within one hundred eighty (180) days of receipt thereof in long-term productive assets of the general type used in the business of the Borrower and its Subsidiaries (provided that if, prior to the expiration of such one hundred eighty (180) day period, Borrower, directly or through its Subsidiaries, shall have entered into a binding agreement providing for such investment on or prior to the expiration of an additional ninety (90) day period, such one hundred eighty (180) day period shall be extended to the date provided for such investment in such binding agreement).

 

(b)           Insurance/Condemnation Proceeds.  No later than the first Business Day following the date of receipt by Holdings or any of its Subsidiaries, or the Administrative Agent as loss payee, of any Net Cash Proceeds of the type described in clause (b) of the definition thereof, the Borrower shall prepay the Loans and/or the Revolving Commitments shall be permanently reduced as set forth in Section 2.15(b) in an aggregate amount equal to such Net Cash Proceeds; provided, that so long as no Default or Event of Default shall have occurred and be continuing at the time of the delivery of the notice described in the following clause or at the proposed time of the investment of such Net Cash Proceeds as described in the following clause, the Borrower shall have the option, upon written notice to the Administrative Agent, directly or through one or more of its Subsidiaries to invest such Net Cash Proceeds within one hundred eighty (180) days of receipt thereof in long term productive assets of the general type used in the business of Holdings and its Subsidiaries, which investment may include the repair, restoration or replacement of the applicable assets thereof (provided that if, prior to the expiration of such one hundred eighty (180) day period, Borrower, directly or through its Subsidiaries, shall have entered into a binding agreement providing for such investment on or prior to the expiration of an additional ninety (90) day period, such one hundred eighty (180) day period shall be extended to the date provided for such investment in such binding agreement); provided, further, that pending any such investment all such Net Cash Proceeds, as the case may be, shall be applied to prepay Revolving Loans to the extent outstanding (without a reduction in Revolving Commitments).

 

 

56

 

 

(c)           Issuance or Incurrence of Debt.  On the date of receipt by any Loan Party or any of its Subsidiaries of any Net Cash Proceeds from the issuance or incurrence of any Indebtedness of any Loan Party or any of its Subsidiaries (other than with respect to any Indebtedness permitted to be incurred pursuant to Section 6.01), the Borrower shall prepay the Loans and/or the Revolving Commitments shall be permanently reduced as set forth in Section 2.15(b) in an aggregate amount equal to 100.0% of such Net Cash Proceeds.

 

(d)           Consolidated Excess Cash Flow.  In the event that there shall be Consolidated Excess Cash Flow for any Fiscal Year (commencing with the Fiscal Year ending December 31, 2010), the Borrower shall, on the date the Borrower is required to deliver audited financial statements to the Administrative Agent but in any event no later than one hundred and ten (110) days after the end of such Fiscal Year, prepay the Loans as set forth in Section 2.15(b) in an aggregate amount equal to (i) 50% of such Consolidated Excess Cash Flow minus (ii) voluntary repayments of the Loans pursuant to Section 2.13(a) or (b) made during such Fiscal Year (excluding repayments of Revolving Loans or Swing Line Loans except to the extent the Revolving Commitments are permanently reduced in connection with such repayments).

 

(e)           Extraordinary Receipts.  No later than the first Business Day following the date of receipt by Holdings or any of its Subsidiaries of any Net Cash Proceeds in respect of any Extraordinary Receipt, the Borrower shall prepay the Loans and/or the Revolving Commitments shall be permanently reduced as set forth in Section 2.15(b) in an aggregate amount equal to such Net Cash Proceeds.

 

(f)           Revolving Loans and Swing Loans.  The Borrower shall from time to time prepay first, the Swing Line Loans, and second, the Revolving Loans to the extent necessary so that the Total Utilization of Revolving Commitments shall not at any time exceed the Revolving Commitments then in effect.

 

(g)           Prepayment Certificate.  Concurrently with any prepayment of the Loans and/or reduction of the Revolving Commitments pursuant to Sections 2.14(a) through 2.14(e), the Borrower shall deliver to the Administrative Agent a certificate of an Authorized Officer demonstrating the calculation of the amount of the applicable net proceeds or Consolidated Excess Cash Flow, as the case may be.  In the event that the Borrower shall subsequently determine that the actual amount received exceeded the amount set forth in such certificate, the Borrower shall promptly make an additional prepayment of the Loans in an amount equal to such excess, and the Borrower shall concurrently therewith deliver to the Administrative Agent a certificate of an Authorized Officer demonstrating the derivation of such excess.

 

 

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Section 2.15         Application of Prepayments/Reductions.

 

(a)          Application of Voluntary Prepayments by Type of Loans.  Any prepayment of any Loan pursuant to Section 2.13(a) shall be applied as specified by the Borrower in the applicable notice of prepayment; provided, that in the event the Borrower fails to specify the Loans to which any such prepayment shall be applied, such prepayment shall be applied as follows:

 

first, to repay outstanding Swing Line Loans to the full extent thereof;

 

second, to repay outstanding Revolving Loans to the full extent thereof; and

 

third, to prepay the Term Loans on a pro rata basis (if applicable and in accordance with the respective outstanding principal amounts thereof); and further applied on a pro rata basis to reduce the scheduled remaining Installments of principal of the Term Loans.

 

(b)          Application of Mandatory Prepayments by Type of Loans.  Any amount required to be paid pursuant to Sections 2.14(a) through 2.14(e) shall be applied as follows:

 

first, to prepay Term Loans on a pro rata basis (if applicable and in accordance with the respective outstanding principal amounts thereof) and further applied on a pro rata basis to the remaining scheduled Installments of principal of the Term Loans;

 

second, to prepay the Swing Line Loans to the full extent thereof;

 

third, to prepay the Revolving Loans to the full extent thereof;

 

fourth, to prepay outstanding reimbursement obligations with respect to Letters of Credit; and

 

fifth, to cash collateralize Letters of Credit.

 

(c)          Application of Prepayments of Loans to Base Rate Loans and Eurodollar Rate Loans.  Considering each Class of Loans being prepaid separately, any prepayment thereof shall be applied first to Base Rate Loans to the full extent thereof before application to Eurodollar Rate Loans, in each case in a manner which minimizes the amount of any payments required to be made by the Borrower pursuant to Section 2.18(c).

 

Section 2.16         General Provisions Regarding Payments.

 

(a)          All payments by the Borrower of principal, interest, fees and other Obligations shall be made in Dollars in same day funds, without defense, setoff or counterclaim, free of any restriction or condition, and delivered to the Administrative Agent not later than 12:00 p.m. (New York City time) on the date due at the Principal Office designated by the Administrative Agent for the account of Lenders.  For purposes of computing interest and fees, funds received by the Administrative Agent after that time on such due date shall be deemed to have been paid by the Borrower on the next succeeding Business Day.

 

 

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(b)           All payments in respect of the principal amount of any Loan (other than voluntary prepayments of Revolving Loans) shall be accompanied by payment of accrued interest on the principal amount being repaid or prepaid, and all such payments (and, in any event, any payments in respect of any Loan on a date when interest is due and payable with respect to such Loan) shall be applied to the payment of interest then due and payable before application to principal.

 

(c)           The Administrative Agent (or its agent or sub-agent appointed by it) shall promptly distribute to each Lender at such address as such Lender shall indicate in writing, such Lender’s applicable Pro Rata Share of all payments and prepayments of principal and interest due hereunder, together with all other amounts due thereto, including all fees payable with respect thereto, to the extent received by the Administrative Agent.

 

(d)           Notwithstanding the foregoing provisions hereof, if any Conversion/ Continuation Notice is withdrawn as to any Affected Lender or if any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any Eurodollar Rate Loans, the Administrative Agent shall give effect thereto in apportioning payments received thereafter.

 

(e)           Subject to the provisos set forth in the definition of “Interest Period” as they may apply to Revolving Loans, whenever any payment to be made hereunder with respect to any Loan shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and, with respect to Revolving Loans only, such extension of time shall be included in the computation of the payment of interest hereunder or of the Revolving Commitment fees hereunder.

 

(f)           The Borrower hereby authorizes the Administrative Agent to charge the Borrower’s accounts with the Administrative Agent in order to cause timely payment to be made to the Administrative Agent of all principal, interest, fees and expenses due hereunder (subject to sufficient funds being available in its accounts for that purpose).

 

(g)           The Administrative Agent shall deem any payment by or on behalf of the Borrower hereunder that is not made in same day funds prior to 12:00 p.m. (New York City time) to be a non-conforming payment.  Any such payment shall not be deemed to have been received by the Administrative Agent until the later of (i) the time such funds become available funds, and (ii) the applicable next Business Day.  The Administrative Agent shall give prompt telephonic notice to the Borrower and each applicable Lender (confirmed in writing) if any payment is non-conforming.  Any non-conforming payment may constitute or become a Default or Event of Default in accordance with the terms of Section 8.01(a).  Interest shall continue to accrue on any principal as to which a non-conforming payment is made until such funds become available funds (but in no event less than the period from the date of such payment to the next succeeding applicable Business Day) at the Default Rate from the date such amount was due and payable until the date such amount is paid in full.

 

(h)           If an Event of Default shall have  occurred and not otherwise been waived, and the maturity of the Obligations shall have been accelerated pursuant to Section 8.01, all payments or proceeds received by Agents hereunder in respect of any of the Obligations, shall be applied in accordance with the application arrangements described in Section 9.2 of the Pledge and Security Agreement.

 

 

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Section 2.17          Ratable Sharing.  Lenders hereby agree among themselves, that if any of them shall, whether by voluntary payment (other than a voluntary prepayment of Loans made and applied in accordance with the terms hereof), through the exercise of any right of set-off or banker’s lien, by counterclaim or cross action or by the enforcement of any right under the Loan Documents or otherwise, or as adequate protection of a deposit treated as cash collateral under the Bankruptcy Code, receive payment or reduction of a proportion of the aggregate amount of principal, interest, amounts payable in respect of Letters of Credit, fees and other amounts then due and owing to such Lender hereunder or under the other Loan Documents (collectively, the “Aggregate Amounts Due” to such Lender) which is greater than the proportion received by any other Lender in respect of the Aggregate Amounts Due to such other Lender, then the Lender receiving such proportionately greater payment shall (a) notify the Administrative Agent and each other Lender of the receipt of such payment and (b) apply a portion of such payment to purchase participations (which it shall be deemed to have purchased from each seller of a participation simultaneously upon the receipt by such seller of its portion of such payment) in the Aggregate Amounts Due to the other Lenders so that all such recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion to the Aggregate Amounts Due to them; provided, that if all or part of such proportionately greater payment received by such purchasing Lender is thereafter recovered from such Lender upon the bankruptcy or reorganization of the Borrower or otherwise, those purchases shall be rescinded and the purchase prices paid for such participations shall be returned to such purchasing Lender ratably to the extent of such recovery, but without interest.  the Borrower expressly consents to the foregoing arrangement and agrees that any holder of a participation so purchased may exercise any and all rights of banker’s lien, set-off or counterclaim with respect to any and all monies owing by the Borrower to that holder with respect thereto as fully as if that holder were owed the amount of the participation held by that holder.  The provisions of this Section 2.17 shall not be construed to apply to (a) any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or (b) any payment obtained by any Lender as consideration for the assignment or sale of a participation in any of its Loans or other Obligations owed to it in accordance with the express terms of this Agreement.

 

Section 2.18          Making or Maintaining Eurodollar Rate Loans; Inability to Determine Applicable Interest Rate.  In the event that the Administrative Agent shall have determined (which determination shall be final and conclusive and binding upon all parties hereto), on any Interest Rate Determination Date with respect to any Eurodollar Rate Loans, that by reason of circumstances affecting the London interbank market adequate and fair means do not exist for ascertaining the interest rate applicable to such Loans on the basis provided for in the definition of Adjusted Eurodollar Rate, the Administrative Agent shall on such date give notice (by telefacsimile or by telephone confirmed in writing) to the Borrower and each Lender of such determination, whereupon (i) no Loans may be made as, or converted to, Eurodollar Rate Loans until such time as the Administrative Agent notifies the Borrower and Lenders that the circumstances giving rise to such notice no longer exist and (ii) any Borrowing Notice or Conversion/Continuation Notice given by the Borrower with respect to the Loans in respect of which such determination was made shall be deemed to be rescinded by the Borrower.

 

 

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(b)           Illegality or Impracticability of Eurodollar Rate Loans.  In the event that on any date any Lender shall have determined (which determination shall be final and conclusive and binding upon all parties hereto) that the making, maintaining or continuation of its Eurodollar Rate Loans (i) has become unlawful as a result of compliance by such Lender in good faith with any law, treaty, governmental rule, regulation, guideline or order (or would conflict with any such treaty, governmental rule, regulation, guideline or order not having the force of law even though the failure to comply therewith would not be unlawful) or (ii) has become impracticable, as a result of contingencies occurring after the date hereof which materially and adversely affect the London interbank market or the position of such Lender in that market, then, and in any such event, such Lender shall be an “Affected Lender” and it shall on that day give notice (by telefacsimile or by telephone confirmed in writing) to the Borrower and the Administrative Agent of such determination (which notice the Administrative Agent shall promptly transmit to each other Lender).  If the Administrative Agent receives a notice from (x) any Lender pursuant to clause (i) of the preceding sentence or (y) a notice from Lenders constituting the Required Lenders pursuant to clause (ii) of the preceding sentence, then (1) the obligation of the Lenders (or, in the case of any notice pursuant to clause (i) of the preceding sentence, such Lender) to make Loans as, or to convert Loans to, Eurodollar Rate Loans shall be suspended until such notice shall be withdrawn by each Affected Lender, (2) to the extent such determination by the Affected Lender relates to a Eurodollar Rate Loan then being requested by the Borrower pursuant to a Borrowing Notice or a Conversion/Continuation Notice, the Lenders (or, in the case of any notice pursuant to clause (i) of the preceding sentence, such Lender) shall make such Loan as (or continue such Loan as or convert such Loan to, as the case may be) a Base Rate Loan, (3) the Lenders’ (or, in the case of any notice pursuant to clause (i) of the preceding sentence, such Lender’s) obligations to maintain their respective outstanding Eurodollar Rate Loans (the “Affected Loans”) shall be terminated at the earlier to occur of the expiration of the Interest Period then in effect with respect to the Affected Loans or when required by law and (4) the Affected Loans shall automatically convert into Base Rate Loans on the date of such termination.  Notwithstanding the foregoing, to the extent a determination by an Affected Lender as described above relates to a Eurodollar Rate Loan then being requested by the Borrower pursuant to a Borrowing Notice or a Conversion/Continuation Notice, the Borrower shall have the option, subject to the provisions of Section 2.18(c), to rescind such Borrowing Notice or Conversion/Continuation Notice as to all Lenders by giving notice (by telefacsimile) to the Administrative Agent of such rescission on the date on which the Affected Lender gives notice of its determination as described above (which notice of rescission the Administrative Agent shall promptly transmit to each other Lender).

 

(c)           Compensation for Breakage or Non-Commencement of Interest Periods.  The Borrower shall compensate each Lender, upon written request by such Lender (which request shall set forth the basis for requesting such amounts), for all reasonable losses, expenses and liabilities (including any interest paid by such Lender to Lenders of funds borrowed by it to make or carry its Eurodollar Rate Loans and any loss, expense or liability sustained by such Lender in connection with the liquidation or re-employment of such funds but excluding loss of anticipated profits) which such Lender may sustain: (i) if for any reason (other than a default by such Lender) a borrowing of any Eurodollar Rate Loan does not occur on a date specified therefor in a Borrowing Notice, or a conversion to or continuation of any Eurodollar Rate Loan does not occur on a date specified therefor in a Conversion/Continuation Notice; (ii) if any prepayment or other principal payment of, or any conversion of, any of its Eurodollar Rate Loans occurs on a date prior to the last day of an Interest Period applicable to that Loan; or (iii) if any prepayment of any of its Eurodollar Rate Loans is not made on any date specified in a notice of prepayment given by the Borrower.

 

 

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(d)           Booking of Eurodollar Rate Loans.  Any Lender may make, carry or transfer Eurodollar Rate Loans at, to or for the account of any of its branch offices or the office of an Affiliate of such Lender.

 

(e)           Assumptions Concerning Funding of Eurodollar Rate Loans.  Calculation of all amounts payable to a Lender under this Section 2.18 and under Section 2.19 shall be made as though such Lender had actually funded each of its relevant Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing interest at the rate obtained pursuant to clause (i) of the definition of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar Rate Loan and having a maturity comparable to the relevant Interest Period and through the transfer of such Eurodollar deposit from an offshore office of such Lender to a domestic office of such Lender in the United States of America; provided, that each Lender may fund each of its Eurodollar Rate Loans in any manner it sees fit and the foregoing assumptions shall be utilized only for the purposes of calculating amounts payable under this Section 2.18 and under Section 2.19.

 

Section 2.19          Increased Costs; Capital Adequacy.

(a)           Compensation For Increased Costs and Taxes.  Subject to the provisions of Section 2.20 (which shall be controlling with respect to the matters covered thereby), in the event that any Lender (which term shall include the Issuing Bank for purposes of this Section 2.19(a)) shall determine (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto) that any law, treaty or governmental rule, regulation or order, or any change therein or in the interpretation, administration or application thereof (including the introduction of any new law, treaty or governmental rule, regulation or order), or any determination of a court or governmental authority, in each case that becomes effective after the date hereof, or compliance by such Lender with any guideline, request or directive issued or made after the date hereof by any central bank or other governmental or quasi-governmental authority (whether or not having the force of law): (i) subjects such Lender (or its applicable lending office) to any additional Tax (other than any Tax on the overall net income of such Lender) with respect to this Agreement or any of the other Loan Documents or any of its obligations hereunder or thereunder or any payments to such Lender (or its applicable lending office) of principal, interest, fees or any other amount payable hereunder; (ii) imposes, modifies or holds applicable any reserve (including any marginal, emergency, supplemental, special or other reserve), special deposit, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Lender (other than any such reserve or other requirements with respect to Eurodollar Rate Loans that are reflected in the definition of Adjusted Eurodollar Rate); or (iii) imposes any other condition (other than with respect to a Tax matter) on or affecting such Lender (or its applicable lending office) or its obligations hereunder or the London interbank market; and the result of any of the foregoing is to increase the cost to such Lender of agreeing to make, making or maintaining Loans hereunder or acquiring participations in, issuing or maintaining Letters of Credit hereunder or to reduce any amount received or receivable by such Lender (or its applicable lending office) with respect thereto; then, in any such case, the Borrower shall promptly pay to such Lender, upon receipt of the statement referred to in the next sentence, such additional amount or amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender in its sole discretion shall determine) as may be necessary to compensate such Lender for any such increased cost or reduction in amounts received or receivable hereunder.  Such Lender shall deliver to the Borrower (with a copy to the Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to such Lender under this Section 2.19(a), which statement shall be conclusive and binding upon all parties hereto absent manifest error.

 

 

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(b)           Capital Adequacy Adjustment.  In the event that any Lender (which term shall include the Issuing Bank for purposes of this Section  2.19(b)) shall have determined that the adoption, effectiveness, phase-in or applicability after the Closing Date of any law, rule or regulation (or any provision thereof) regarding capital adequacy, or any change therein or in the interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof, or compliance by any Lender (or its applicable lending office) with any guideline, request or directive regarding capital adequacy (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of, or with reference to, such Lender’s Loans or Revolving Commitment or Letters of Credit, or participations therein or other obligations hereunder with respect to the Loans or the Letters of Credit, to a level below that which such Lender or such controlling corporation could have achieved but for such adoption, effectiveness, phase-in, applicability, change or compliance (taking into consideration the policies of such Lender or such controlling corporation with regard to capital adequacy), then from time to time, within five (5) Business Days after receipt by the Borrower from such Lender of the statement referred to in the next sentence, the Borrower shall pay to such Lender such additional amount or amounts as shall compensate such Lender or such controlling corporation on an after-tax basis for such reduction. Such Lender shall deliver to the Borrower (with a copy to the Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to Lender under this Section 2.19(b), which statement shall be conclusive and binding upon all parties hereto absent manifest error.

 

Section 2.20          Taxes; Withholding, Etc.

 

(a)           Payments to Be Free and Clear.  All sums payable by or on behalf of any Loan Party hereunder and under other Loan Document shall (except to the extent required by law) be paid free and clear of, and without any deduction or withholding for or on account of, any Tax (other than a Tax on the overall net income of any Lender) imposed, levied, collected, withheld or assessed by any Governmental Authority.

 

 

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(b)           Withholding of Taxes.  If any Loan Party or any other Person is required by law to make any deduction or withholding for or on account of any such Tax from any sum paid or payable by any Loan Party to the Administrative Agent or any Lender (which term shall include the Issuing Bank for purposes of this Section 2.20(b)) under any of the Loan Documents: (i) the Borrower shall notify the Administrative Agent of any such requirement or any change in any such requirement as soon as the Borrower becomes aware of it; (ii) the Borrower shall pay any such Tax before the date on which penalties attach thereto, such payment to be made (if the liability to pay is imposed on any Loan Party) for its own account or (if that liability is imposed on the Administrative Agent or such Lender, as the case may be) on behalf of and in the name of the Administrative Agent or such Lender; (iii) the sum payable by such Loan Party in respect of which the relevant deduction, withholding or payment is required shall be increased to the extent necessary to ensure that, after the making of that deduction, withholding or payment, the Administrative Agent or such Lender, as the case may be, receives on the due date a net sum equal to what it would have received had no such deduction, withholding or payment been required or made; and (iv) within thirty (30) days after the due date of payment of any Tax which it is required by clause (ii) above to pay, the Borrower shall deliver to the Administrative Agent evidence satisfactory to the other affected parties of such deduction, withholding or payment and of the remittance thereof to the relevant taxing or other authority; provided, that, with respect to any Tax imposed, levied, collected, withheld or assessed by or pursuant to the laws of the United States of America or any political subdivision thereof or therein, no such additional amount shall be required to be paid to any Lender (other than a Lender that becomes a Lender pursuant to Section 2.23) under clause (iii) above except to the extent that any change after the date hereof (in the case of each Lender listed on the signature pages hereof on the Closing Date) or after the effective date of the Assignment Agreement pursuant to which such Lender became a Lender (in the case of each other Lender) in any such requirement for a deduction, withholding or payment as is mentioned therein shall result in an increase in the rate of such deduction, withholding or payment from that in effect at the date hereof or at the date of such Assignment Agreement, as the case may be, in respect of payments to such Lender; provided, that additional amounts shall be payable to a Lender to the extent such Lender’s assignor was entitled to receive such additional amounts.

 

 

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(c)           Evidence of Exemption From U.S. Withholding Tax.  Each Lender that is not a United States person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax purposes (a “Non-U.S. Lender”) shall, to the extent it is legally entitled to do so, deliver to the Administrative Agent for transmission to the Borrower, on or prior to the Closing Date (in the case of each Lender listed on the signature pages hereof on the Closing Date) or on or prior to the date of the Assignment Agreement pursuant to which it becomes a Lender (in the case of each other Lender), and at such other times as may be necessary in the determination of the Borrower or the Administrative Agent (each in the reasonable exercise of its discretion), (i) two (2) original copies of Internal Revenue Service Form W-8BEN, W-8ECI and/or W-8IMY (or, in each case, any successor forms), properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code and reasonably requested by the Borrower to establish that such Lender is not subject to (or is subject to a reduced rate of) deduction or withholding of United States federal income tax with respect to any payments to such Lender of principal, interest, fees or other amounts payable under any of the Loan Documents or (ii) if such Lender is not a “bank” or other Person described in Section 881(c)(3) of the Internal Revenue Code, a Certificate re Non-Bank Status together with two (2) original copies of Internal Revenue Service Form W-8BEN (or any successor form), properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code and reasonably requested by the Borrower to establish that such Lender is not subject to (or is subject to a reduced rate of) deduction or withholding of United States federal income tax with respect to any payments to such Lender of interest payable under any of the Loan Documents.  Each Lender that is a United States person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for United States federal income tax purposes (a “U.S. Lender”) and is not an exempt recipient within the meaning of Treasury Regulation Section 1.6049-4(c) shall deliver to the Administrative Agent and the Borrower on or prior to the Closing Date (or, if later, on or prior to the date on which such Lender becomes a party to this Agreement) two (2) original copies of Internal Revenue Service Form W-9 (or any successor form), properly completed and duly executed by such Lender, certifying that such U.S. Lender is entitled to an exemption from United States backup withholding tax, or otherwise prove that it is entitled to such an exemption. Each Lender required to deliver any forms, certificates or other evidence with respect to United States federal income tax withholding matters pursuant to this Section 2.20(c) hereby agrees, from time to time after the initial delivery by such Lender of such forms, certificates or other evidence, whenever a lapse in time or change in circumstances renders such forms, certificates or other evidence obsolete or inaccurate in any material respect, that such Lender shall promptly deliver to the Administrative Agent for transmission to the Borrower two (2) new original copies of Internal Revenue Service Form W-8BEN, W-8ECI, W-8IMY and/or W-9 (or, in each case, any successor form), or a Certificate re Non-Bank Status and two (2) original copies of Internal Revenue Service Form W-8BEN (or any successor form), as the case may be, properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code and reasonably requested by the Borrower to confirm or establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to payments to such Lender under the Loan Documents, or notify the Administrative Agent and the Borrower of its inability to deliver any such forms, certificates or other evidence.  The Borrower shall not be required to pay any additional amount to any Non-U.S. Lender under Section 2.20(b)(iii) if such Lender shall have failed (1) to deliver the forms, certificates or other evidence required by in the first sentence of this Section 2.20(c) or (2) to notify the Administrative Agent and the Borrower of its inability to deliver any such forms, certificates or other evidence, as the case may be; provided, that if such Lender shall have satisfied the requirements of the first sentence of this Section 2.20(c) on the Closing Date or on the date of the Assignment Agreement pursuant to which it became a Lender, as applicable, nothing in this last sentence of Section 2.20(c) shall relieve the Borrower of its obligation to pay any additional amounts pursuant this Section 2.20 in the event that, as a result of any change in any applicable law, treaty or governmental rule, regulation or order, or any change in the interpretation, administration or application thereof, such Lender is no longer properly entitled to deliver forms, certificates or other evidence at a subsequent date establishing the fact that such Lender is not subject to withholding as described herein.

 

(d)           Without limiting the provisions of Section 2.20(b), the Borrower shall timely pay all Other Taxes to the relevant Governmental Authorities in accordance with applicable law.  The Borrower shall deliver to the Administrative Agent official receipts or other evidence of such payment reasonably satisfactory to the Administrative Agent in respect of any Other Taxes payable hereunder promptly after payment of such Other Taxes.

 

 

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(e)           The Borrower and Holdings shall jointly and severally indemnify the Administrative Agent and any Lender (which term shall include Issuing Bank for purposes of this Section 2.20(e)) for the full amount of Taxes for which additional amounts are required to be paid pursuant to Section 2.20(b) and Other Taxes, in each case arising in connection with this Agreement or any other Loan Document (including any such Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.20) paid by the Administrative Agent or Lender or any of their respective Affiliates and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to such Loan Party shall be conclusive absent manifest error.  Such payment shall be due within thirty (30) days of such Loan Party’s receipt of such certificate.

 

Section 2.21          Obligation to Mitigate.  Each Lender (which term shall include the Issuing Bank for purposes of this Section 2.21) agrees that, as promptly as practicable after the officer of such Lender responsible for administering its Loans or Letters of Credit, as the case may be, becomes aware of the occurrence of an event or the existence of a condition that would cause such Lender to become an Affected Lender or that would entitle such Lender to receive payments under Section 2.18, 2.19 or 2.20, it shall, to the extent not inconsistent with the internal policies of such Lender and any applicable legal or regulatory restrictions, use reasonable efforts to (a) make, issue, fund or maintain its Credit Extensions, including any Affected Loans, through another office of such Lender or (b) take such other measures as such Lender may deem reasonable, if as a result thereof the circumstances which would cause such Lender to be an Affected Lender would cease to exist or the additional amounts which would otherwise be required to be paid to such Lender pursuant to Section 2.18, 2.19 or 2.20 would be materially reduced and if, as determined by such Lender in its sole discretion, the making, issuing, funding or maintaining of such Revolving Commitments, Loans or Letters of Credit through such other office or in accordance with such other measures, as the case may be, would not otherwise adversely affect such Revolving Commitments, Loans or Letters of Credit or the interests of such Lender; provided, that such Lender shall not be obligated to utilize such other office pursuant to this Section 2.21 unless the Borrower agrees to pay all incremental expenses incurred by such Lender as a result of utilizing such other office as described above.  A certificate as to the amount of any such expenses payable by the Borrower pursuant to this Section 2.21 (setting forth in reasonable detail the basis for requesting such amount) submitted by such Lender to the Borrower (with a copy to the Administrative Agent) shall be conclusive absent manifest error.

 

Section 2.22          Defaulting Lenders.  Notwithstanding anything to the contrary contained in this Agreement, if any Swing Line Commitment or Letter of Credit Commitment exists at the time a Lender having a Revolving Commitment becomes a Defaulting Lender (such Lender, a “Defaulting Revolving Lender”) then:

 

(a)           all or any part of such Swing Line Commitment and Letter of Credit Commitment shall be reallocated among the non-Defaulting Revolving Lenders in accordance with their respective Pro Rata Share of such Swing Line Commitment and/or Letter of Credit Commitment but only to the extent (i) the sum of the non-Defaulting Revolving Lenders’ Pro Rata Shares of the Total Utilization of Revolving Commitments plus such Defaulting Revolving Lender’s Pro Rata Share of Revolving Exposure do not exceed the total of all non-Defaulting Revolving Lenders’ Revolving Commitments and (ii) the conditions set forth in Section 3.02 are satisfied at such time;

 

 

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(b)           if the reallocation described in clause (a) above cannot, or can only partially, be effected, the Borrower shall (i) first, within one Business Day following notice by the Administrative Agent, prepay any outstanding Swing Line Loans to the extent the Swing Line Commitments related thereto have not been reallocated pursuant to clause (a) above and (ii) second, within three Business Days following notice by the Administrative Agent, cash collateralize such Defaulting Revolving Lender’s Pro Rata Share of the Letter of Credit Commitment (after giving effect to any partial reallocation pursuant to clause (a) above) for so long as such Letter of Credit Commitment is outstanding; and

 

(c)           if the Letter of Credit Commitment of the non-Defaulting Revolving Lenders is reallocated pursuant to clause (a) above, then the fees payable to the Lenders pursuant to Section 2.11 shall be adjusted in accordance with such non-Defaulting Revolving Lenders’ Pro Rata Shares.

 

Section 2.23          Removal or Replacement of a Lender. Anything contained herein to the contrary notwithstanding, in the event that: (a) (i) any Lender (an “Increased-Cost Lender”) shall give notice to the Borrower that such Lender is an Affected Lender or that such Lender is entitled to receive payments under Section  2.18, 2.19 or 2.20, (ii) the circumstances which have caused such Lender to be an Affected Lender or which entitle such Lender to receive such payments shall remain in effect, and (iii) such Lender shall fail to withdraw such notice within five (5) Business Days after the Borrower’s request for such withdrawal; or (b) (i) any Lender shall become a Defaulting Lender and such Defaulting Lender shall fail to cure the default as a result of which it has become a Defaulting Lender within five (5) Business Days after the Borrower’s written request that it cure such default; or (c) in connection with any proposed amendment, modification, termination, waiver or consent with respect to any of the provisions hereof as contemplated by Section 10.05(b), the consent of Required Lenders shall have been obtained but the consent of one or more of such other Lenders (each a “Non-Consenting Lender”) whose consent is required shall not have been obtained; then, with respect to each such Increased-Cost Lender, Defaulting Lender or Non-Consenting Lender (the “Terminated Lender”), the Borrower may, by giving written notice to the Administrative Agent and any Terminated Lender of its election to do so, elect to cause such Terminated Lender (and such Terminated Lender hereby irrevocably agrees) to assign its outstanding Loans and its Revolving Commitments, if any, in full to one or more Eligible Assignees (each a “Replacement Lender”) in accordance with the provisions of Section 10.06 and the Borrower shall pay the fees, if any, payable thereunder in connection with any such assignment from an Increased-Cost Lender, Defaulting Lender or a Non-Consenting Lender; provided, that (1) on the date of such assignment, the Replacement Lender shall pay to the Terminated Lender an amount equal to the sum of (A) an amount equal to the principal of, and all accrued interest on, all outstanding Loans of the Terminated Lender, (B) an amount equal to all unreimbursed drawings on Letters of Credit that have been funded by such Terminated Lender, together with all then unpaid interest with respect thereto at such time and (C) an amount equal to all accrued but theretofore unpaid fees owing to such Terminated Lender pursuant to Section 2.11; (2) on the date of such assignment, the Borrower shall pay any amounts payable to such Terminated Lender pursuant to Section 2.18(c), 2.19 or 2.20; or otherwise as if it were a prepayment and (3) in the event such Terminated Lender is a Non-Consenting Lender, each Replacement Lender shall consent, at the time of such assignment, to each matter in respect of which such Terminated Lender was a Non-Consenting Lender; provided, that the Borrower may not make such election with respect to any Terminated Lender that is also the Issuing Bank unless, prior to the effectiveness of such election, the Borrower shall have caused each outstanding Letter of Credit issued thereby to be cancelled.  Upon the prepayment of all amounts owing to any Terminated Lender and the termination of such Terminated Lender’s Revolving Commitment, if any, such Terminated Lender shall no longer constitute a “Lender” for purposes hereof; provided, that any rights of such Terminated Lender to indemnification hereunder shall survive as to such Terminated Lender.  Each Lender agrees that if the Borrower exercises its option hereunder to cause an assignment by such Lender as a Non-Consenting Lender or Terminated Lender, such Lender shall, promptly after receipt of written notice of such election, execute and deliver all documentation necessary to effectuate such assignment in accordance with Section 10.06.  In the event that a Lender does not comply with the requirements of the immediately preceding sentence  within one Business Day after receipt of such notice, each Lender hereby authorizes and directs the Administrative Agent to execute and deliver such documentation as may be required to give effect to an assignment in accordance with Section 10.06 on behalf of a Non-Consenting Lender, Terminated Lender or Defaulting Lender and any such documentation so executed by the Administrative Agent shall be effective for purposes of documenting an assignment pursuant to Section 10.06.

 

 

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Section 2.24          Incremental Facilities.  The Borrower may by written notice to the Administrative Agent elect to request (A) prior to the Revolving Commitment Termination Date, an increase to the existing Revolving Commitments (any such increase, the “Incremental Revolving Commitments”) and/or (B) prior to the Tranche B Term Loan Maturity Date, the establishment of one or more new term loan commitments (the “Incremental Term Loan Commitments”), by an amount not in excess of $75,000,000 in the aggregate and not less than $25,000,000 individually (or such lesser amount which shall be approved by the Administrative Agent or such lesser amount that shall constitute the difference between $75,000,000 and all such Incremental Revolving Commitments and Incremental Term Loan Commitments obtained prior to such date), and integral multiples of $5,000,000 in excess of that amount.  Each such notice shall specify (A) the date (each, an “Increased Amount Date”) on which the Borrower proposes that the Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, shall be effective, which shall be a date not less than 10 Business Days after the date on which such notice is delivered to the Administrative Agent and (B) the identity of each Lender or other Person that is an Eligible Assignee (each, an “Incremental Revolving Loan Lender” or “Incremental Term Loan Lender”, as applicable) to whom the Borrower proposes any portion of such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, be allocated and the amounts of such allocations; provided that Barclays Bank may elect or decline to arrange such Incremental Revolving Commitments or Incremental Term Loan Commitments in its sole discretion and any Lender approached to provide all or a portion of the Incremental Revolving Commitments or Incremental Term Loan Commitments may elect or decline, in its sole discretion, to provide an Incremental Revolving Commitment or an Incremental Term Loan Commitment.  Such Incremental Revolving Commitments or Incremental Term Loan Commitments shall become effective as of such Increased Amount Date; provided that (1) the ratio of (i) Consolidated Total Secured Debt after giving effect to such Incremental Revolving Commitment or the Incremental Term Loan Commitment, as applicable, to (ii) pro forma Consolidated Adjusted EBITDA for the latest twelve-month period for which financial statements are then available shall be less than or equal to 3.25:1.00; (2) no Default or Event of Default shall exist on such Increased Amount Date before or after giving effect to such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable; (3) both before and after giving effect to the making of any Series of Incremental Term Loans, each of the conditions set forth in Section 3.02 shall be satisfied; (4) Holdings shall be in pro forma compliance (calculated in accordance with the definition of Consolidated Adjusted EBITDA) with each of the covenants set forth in Section 6.07 as of the last day of the most recently ended Fiscal Quarter, after giving effect to such Incremental Revolving Commitments or Incremental Term Loan Commitments, including any acquisitions consummated with the proceeds thereof or dispositions after the beginning of the relevant determination period but prior to or simultaneous with the borrowing of such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable; (5) the Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, shall be effected pursuant to one or more Joinder Agreements executed and delivered by the Borrower, the Incremental Revolving Loan Lender or Incremental Term Loan Lender, as applicable, and the Administrative Agent, and each of which shall be recorded in the Register and each Incremental Revolving Loan Lender and Incremental Term Loan Lender shall be subject to the requirements set forth in Section 2.20(c); (6) the Borrower shall make any payments required pursuant to Section 2.18(c) in connection with the Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable; (7) all other fees and expenses owing in respect of such increase to the Administrative Agent, the Collateral Agent and the Lenders will have been paid; (8) such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, shall share pari passu in the Guarantees and Collateral; and (9) the Borrower shall deliver or cause to be delivered any legal opinions or other documents (including modifications of Mortgages and title insurance endorsements or policies) reasonably requested by the Administrative Agent in connection with any such transaction.  Any Incremental Term Loans made on an Increased Amount Date shall be designated a separate series (a “Series”) of Incremental Term Loans for all purposes of this Agreement.

  

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On any Increased Amount Date on which Incremental Revolving Commitments are effected, subject to the satisfaction of the foregoing terms and conditions, (a) each of the Revolving Lenders shall assign to each of the Incremental Revolving Loan Lenders, and each of the Incremental Revolving Loan Lenders shall purchase from each of the Revolving Loan Lenders, at the principal amount thereof (together with accrued interest), such interests in the Revolving Loans outstanding on such Increased Amount Date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Revolving Loans will be held by existing Revolving Loan Lenders and Incremental Revolving Loan Lenders ratably in accordance with their Revolving Commitments after giving effect to the addition of such Incremental Revolving Commitments to the Revolving Commitments, (b) each Incremental Revolving Commitment shall be deemed for all purposes a Revolving Commitment and each Loan made thereunder (an “Incremental Revolving Loan”) shall be deemed, for all purposes, a Revolving Loan and (c) each Incremental Revolving Loan Lender shall become a Lender with respect to the Incremental Revolving Commitment and all matters relating thereto.

 

On any Increased Amount Date on which any Incremental Term Loan Commitments of any Series are effective, subject to the satisfaction of the foregoing terms and conditions, (i) each Incremental Term Loan Lender of any Series shall make a Loan to the Borrower (an “Incremental Term Loan”) in an amount equal to its Incremental Term Loan Commitment of such Series and (ii) each Incremental Term Loan Lender of any Series shall become a Lender hereunder with respect to the Incremental Term Loan Commitment of such Series and the Incremental Term Loans of such Series made pursuant thereto.

 

 

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The Administrative Agent shall notify the Lenders promptly upon receipt of the Borrower’s notice of each Increased Amount Date and in respect thereof (y) the Incremental Revolving Commitments and the Incremental Revolving Loan Lenders or the Series of Incremental Term Loan Commitments and the Incremental Term Loan Lenders of such Series, as applicable and (z) in the case of each notice to any Revolving Loan Lender, the respective interests in such Revolving Loan Lender’s Revolving Loans, in each case subject to the assignments contemplated by this Section.

The terms and provisions of the Incremental Term Loans and Incremental Term Loan Commitments of any Series shall be, except as otherwise set forth herein or as agreed between the Borrower and the Lenders providing such Incremental Term Loans and as set forth in the Joinder Agreement, identical to the existing Term Loans.  The terms and provisions of the Incremental Revolving Loans shall be identical to the Revolving Loans and such Incremental Revolving Loan will be documented solely as an increase to the Revolving Commitments, without any change in terms other than any change that is more favorable to the Revolving Lenders and applies to all loans and commitments under the Revolving Loans (it being understood that the Administrative Agent shall be empowered to, on behalf of all the Revolving Lenders, execute an amendment to the definitive documentation relating to the Revolving Loans in order to give effect to such a change more favorable to the Revolving Lenders).  In any event (i) the Weighted Average Life to Maturity of all Incremental Term Loans of any Series shall be no shorter than the Weighted Average Life to Maturity of the existing Term Loans, (ii) the applicable Incremental Term Loan Maturity Date of each Series shall be no shorter than the latest of the final maturity of the existing Term Loans, and (iii) if the initial “yield” (for purposes of this Section 2.24, the “yield” with respect to any Loan shall be calculated as the sum of the Eurodollar Loan margin on the relevant Loan plus any original issue discount or upfront fees in lieu of original issue discount (other than any arranging fees, underwriting fees and commitment fees) (based on an assumed four-year average life for the applicable credit facilities (e.g., 100 basis points in original issue discount or upfront fees equals 25 basis points of interest rate margin))) relating to the Incremental Term Loans exceeds the “rate” (which for purposes of this Section 2.24 shall be calculated as the Applicable Margin) then in effect with respect to the existing Term Loans by more than 0.25%, then the Applicable Margin relating to the existing Term Loans and the existing Revolving Loans shall be adjusted so that the yield relating to such Incremental Term Loans does not exceed the rate applicable to the existing Term Loans or the existing Revolving Loans, as applicable, by more than 0.25%, and if the lowest permissible Adjusted Eurodollar Rate is greater than 2.00% or the lowest permissible Base Rate is greater than 3.00%, for such Incremental Term Loans, the difference between such “floor” and 2.00%, in the case of Incremental Term Loans with the Adjusted Eurodollar Rate, or 3.00%, in the case of Incremental Term Loans with Base Rate, shall be used in calculating “yield” for purposes of clause (iii) above.  Each Joinder Agreement may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Credit Documents as may be necessary or appropriate, in the opinion of the Administrative Agent to effect the provisions of this Section 2.24.

 

 

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ARTICLE III.

CONDITIONS PRECEDENT

 

Section 3.01          Closing Date.  The obligation of each Lender to make a Credit Extension on the Closing Date is subject to the satisfaction, or waiver in accordance with Section 10.05, of the following conditions on or before the Closing Date:

 

(a)           Loan Documents.  The Administrative Agent shall have received each Loan Document originally executed and delivered by each applicable Loan Party.

(b)           Organizational Documents; Incumbency.  The Administrative Agent shall have received (1) copies of each Organizational Document of each Loan Party, as applicable, and, to the extent applicable, certified as of a recent date by the appropriate governmental official, each dated the Closing Date or a recent date prior thereto; (2) signature and incumbency certificates of the officers of each Loan Party executing the Loan Documents to which it is a party; (3) resolutions of the board of directors or similar governing body of each Loan Party approving and authorizing the execution, delivery and performance of this Agreement and the other Loan Documents and the Senior Notes Documents to which it is a party or by which it or its assets may be bound as of the Closing Date, certified as of the Closing Date by its secretary or an assistant secretary as being in full force and effect without modification or amendment; (4) a good standing certificate from the applicable Governmental Authority of each Loan Party’s jurisdiction of incorporation, organization or formation (except for good standing certificates of FRI, Inc. and FRI II, Inc. which shall be delivered pursuant to Schedule 6.16) and in each jurisdiction in which it is qualified as a foreign corporation or other entity to do business, each dated a recent date prior to the Closing Date but solely to the extent failure to be so qualified would have a Material Adverse Effect; and (5) such other documents as the Administrative Agent may reasonably request.

 

(c)           Organizational and Capital Structure.  The organizational structure and capital structure of Holdings and its Subsidiaries is as set forth on Schedule 4.01.

 

(d)           Capitalization of Holdings and the Borrower.  On or before the Closing Date:

 

(i)           the Senior Note Indenture and all other agreements and documents contemplated thereby shall have been entered into, on terms acceptable to the Agents and shall be effective, the Administrative Agent shall have received true and correct copies of each Senior Notes Document requested by it and the Borrower shall have received, or substantially concurrently with the initial borrowings under this Agreement shall have received, gross proceeds of the Senior Notes on the Closing Date in an aggregate amount of not less than $210,000,000 (or the conditions to the issuance of the Senior Notes, other than the funding of the initial borrowings under this Agreement or the satisfaction of the conditions set forth in this Section 3.01, shall have been satisfied or substantially concurrently with the initial borrowings under this Agreement shall be satisfied);

 

(ii)           the proceeds of the Senior Notes together with the initial borrowings under this Agreement shall be sufficient to refinance all the Existing Indebtedness of the Borrower and its Subsidiaries, consummate the Related Acquisitions after the Closing Date and pay the fees and expenses of the foregoing;

 

 

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(e)           Existing Indebtedness.  On the Closing Date, Holdings and its Subsidiaries shall have (1) repaid in full all Existing Indebtedness, (2) terminated any commitments to lend or make other extensions of credit thereunder, (3) delivered to the Administrative Agent all documents or instruments necessary to release all Liens securing Existing Indebtedness or other obligations of Holdings and its Subsidiaries thereunder being repaid on the Closing Date and (4) made arrangements satisfactory to the Administrative Agent with respect to the cancellation of any letters of credit outstanding thereunder or the issuance of Letters of Credit to support the obligations of Holdings and its Subsidiaries with respect thereto.

 

(f)           Transaction Costs.  On or prior to the Closing Date, the Borrower shall have delivered to the Administrative Agent the Borrower’s reasonable estimate of the Transaction Costs (other than fees payable to any Agent).

 

(g)           Governmental Authorizations and Consents.  Each Loan Party shall have obtained all Governmental Authorizations and all consents of other Persons, in each case that are necessary or advisable in connection with the transactions contemplated by the Loan Documents and the Senior Notes Documents, and each of the foregoing shall be in full force and effect and in form and substance reasonably satisfactory to the Administrative Agent.  All applicable waiting periods shall have expired without any action being taken or threatened by any competent authority which would restrain, prevent or otherwise impose adverse conditions on the transactions contemplated by the Loan Documents or the Senior Notes Documents or the financing thereof and no action, request for stay, petition for review or rehearing, reconsideration, or appeal with respect to any of the foregoing shall be pending, and the time for any applicable agency to take action to set aside its consent on its own motion shall have expired.

 

(h)           Personal Property Collateral.  In order to create in favor of the Collateral Agent, for the benefit of Secured Parties, a valid, perfected First Priority security interest in the personal property Collateral, each Loan Party shall have delivered to the Collateral Agent:

 

(1)           evidence satisfactory to the Collateral Agent of the compliance by each Loan Party of their obligations under the Pledge and Security Agreement and the other Security Documents (including their obligations to authorize UCC financing statements and execute and deliver originals of securities, instruments and chattel paper and any agreements governing deposit and/or securities accounts as provided therein);

 

(2)           a completed Perfection Certificate dated the Closing Date and executed by an Authorized Officer of each Loan Party, together with all attachments contemplated thereby;

 

(3)           fully executed and notarized Intellectual Property Security Agreements, in proper form for filing or recording in all appropriate places in all applicable jurisdictions, memorializing and recording the encumbrance of the Intellectual Property Assets listed in Schedule 5.2 to the Pledge and Security Agreement;

 

 

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(4)           evidence that each Loan Party shall have taken or caused to be taken any other action, executed and delivered or caused to be executed and delivered any other agreement, document and instrument (including, to the extent requested by the Administrative Agent, any intercompany notes evidencing Indebtedness permitted to be incurred pursuant to Section 6.01(b)) and made or caused to be made any other filing and recording (other than as set forth herein) reasonably required by the Collateral Agent; and

 

(5)           evidence satisfactory to the Collateral Agent that the Borrower has retained, at its sole cost and expense, a service provider acceptable to the Collateral Agent for the tracking of all of UCC financing statements of the Borrower and the Guarantors and that shall provide notification to the Collateral Agent of, among other things, the upcoming lapse or expiration thereof.

 

(i)           Financial Statements; Projections.  The Administrative Agent shall have received from Holdings (1) at least fifteen (15) days prior to the Closing Date, the Historical Financial Statements and (2) at least seven (7) days prior to the Closing Date, customary additional unaudited financial statements acceptable to the Administrative Agent for all recent, probable or pending acquisitions and (3) at least fifteen (15) days prior to the Closing Date, the Projections.

 

(j)           Evidence of Insurance.  The Collateral Agent shall have received a certificate from the Borrower’s insurance broker or other evidence satisfactory to it that all insurance required to be maintained pursuant to Section 5.05 is in full force and effect, together with endorsements naming the Collateral Agent, for the benefit of Secured Parties, as loss payee thereunder and each of the Secured Parties as additional insureds, in each case, to the extent required under Section 5.05.

 

(k)           Opinions of Counsel to Loan Parties.  The Agents and the Lenders and their respective counsel shall have received originally executed copies of the favorable written opinions of Sheppard, Mullin, Richter & Hampton and Jeff Linden, counsel for Loan Parties, in the form of Exhibit D-1 and Exhibit D-2 and as to such other matters as the Administrative Agent may reasonably request, dated as of the Closing Date and otherwise in form and substance reasonably satisfactory to the Administrative Agent (and each Loan Party hereby instructs such counsel to deliver such opinions to the Agents and the Lenders).

 

(l)           Fees.  The Borrower shall have paid to (i) the Lenders the fees payable on the Closing Date referred to in Section 2.11(d) and any fees payable to the Agents in their capacities as such or otherwise in connection herewith referred to Section 2.11(e).  All such amounts may be paid out of the proceeds of the Tranche B Term Loans or other proceeds received on the Closing Date.

 

(m)          Solvency; Solvency Certificate.  On the Closing Date, (i) after giving effect to the consummation of the Transactions and any rights of contribution, the Loan Parties, taken as a whole, are and shall be Solvent and (ii) the Administrative Agent shall have received the Solvency Certificate from the chief financial officer of the Borrower and each Guarantor.

 

 

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(n)          Closing Date Certificate.  Holdings and the Borrower shall have delivered to the Administrative Agent an originally executed Closing Date Certificate, together with all attachments thereto, and which shall include certifications to the effect that:

 

(i)            since December 31, 2009, there shall not have occurred a Material Adverse Effect; and

 

(ii)           each of the conditions precedent described in this Section 3.01 and Section 3.02 shall have been satisfied on the Closing Date (except that no opinion need be expressed as to Administrative Agent’s, Agents’, or Required Lenders’ satisfaction with any document, instrument or other matter).

 

(o)          Credit Rating.  The Borrower shall have been assigned a corporate family rating from Moody’s, a corporate credit rating from S&P, and the Term Loans and Senior Notes shall have been assigned a credit rating from each of Moody’s and S&P.

 

(p)          No Litigation.  There shall not exist any action, suit, investigation, litigation, proceeding, hearing or other legal or regulatory developments, pending or threatened in any court or before any arbitrator or Governmental Authority that, in the reasonable opinion of the Agents, singly or in the aggregate, materially impairs the consummation of the Transactions, the financing thereof or any of the other transactions contemplated by the Loan Documents or the Senior Notes Documents, or that could reasonably be expected to have a Material Adverse Effect.

 

(q)          Completion of Proceedings.  All partnership, corporate and other proceedings taken or to be taken in connection with the transactions contemplated hereby and all documents incidental thereto not previously found acceptable by the Administrative Agent and its counsel shall be satisfactory in form and substance to the Administrative Agent and the Agents and such counsel, and the Administrative Agent and such counsel shall have received all such counterpart originals or certified copies of such documents as the Administrative Agent may reasonably request.

 

(r)          Letter of Direction.  The Administrative Agent shall have received a duly executed letter of direction from the Borrower addressed to the Administrative Agent, on behalf of itself and Lenders, directing the disbursement on the Closing Date of the proceeds of the Loans made on such date.

 

(s)          Bank Regulatory Information.  At least 10 days prior to the Closing Date, the Lenders shall have received all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001) the “PATRIOT Act”).

 

 

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(t)           Lien and Judgment Searches.  The Collateral Agent shall have received the results of recent lien and judgment searches in each of the jurisdictions in which Uniform Commercial Code financing statements or other filings or recordations should be made to evidence or perfect security interests in all assets of the Loan Parties, and such search shall reveal no liens on any of the assets of the Loan Party, except for Liens permitted by Section 6.02 or liens to be discharged on or prior to the Closing Date.

 

Section 3.02          Conditions to Each Credit Extension.

 

(a)           Conditions Precedent.  The obligation of each Lender to make any Loan, or the Issuing Bank to issue any Letter of Credit, on any Credit Date, including the Closing Date, are subject to the satisfaction, or waiver in accordance with Section 10.05, of the following conditions precedent:

 

(i)            the Administrative Agent shall have received a fully executed and delivered Borrowing Notice or Issuance Notice, as the case may be;

 

(ii)           after making the Credit Extensions requested on such Credit Date, the Total Utilization of Revolving Commitments shall not exceed the Revolving Commitments then in effect;

 

(iii)          as of such Credit Date, the representations and warranties contained herein and in the other Loan Documents shall be true and correct in all material respects on and as of that Credit Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date; provided, that to the extent any such representation or warranty is already qualified by materiality or material adverse effect, such representation or warranty shall be true and correct in all respects;

 

(iv)          as of such Credit Date, no event shall have occurred and be continuing or would result from the consummation of the applicable Credit Extension that would constitute a Default or an Event of Default; and

 

(v)           on or before the date of issuance of any Letter of Credit, the Administrative Agent shall have received all other information required by the applicable Issuance Notice, and such other documents or information as the Issuing Bank may reasonably require in connection with the issuance of such Letter of Credit.

 

Any Agent or the Required Lenders shall be entitled, but not obligated to, request and receive, prior to the making of any Credit Extension, additional information reasonably satisfactory to the requesting party confirming the satisfaction of any of the foregoing if, in the good faith judgment of such Agent or the Required Lenders, such request is warranted under the circumstances.

 

(b)           Notices.  Any Notice shall be executed by an Authorized Officer in a writing delivered to the Administrative Agent.

 

 

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ARTICLE IV.

REPRESENTATIONS AND WARRANTIES

 

In order to induce the Lenders and the Issuing Bank to enter into this Agreement and to make each Credit Extension to be made thereby, each Loan Party represents and warrants to each Lender and the Issuing Bank, on the Closing Date and on each Credit Date that the following statements are true and correct:

 

Section 4.01          Organization; Requisite Power and Authority; Qualification.  Each of Holdings and its Subsidiaries (excluding FRI, Inc. and FRI II, Inc., for which certificates of good standings are not yet available) (a) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization (which jurisdictions of organization as of the Closing Date are identified on Schedule 4.01), (b) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby and (c) is qualified to do business and in good standing in every jurisdiction where any material portion of its assets are located and wherever necessary to carry out its material business and operations.

 

Section 4.02          Equity Interests and Ownership.   The Equity Interests of each of the Borrower, any Grantor which is not a Subsidiary of Holdings (each a “Non-Subsidiary Guarantor”) and their respective Subsidiaries has been duly authorized and validly issued and is fully paid and non-assessable.  Except as set forth on Schedule 4.02, as of the date hereof, there is no existing option, warrant, call, right, commitment or other agreement to which the Borrower, a Non-Subsidiary Guarantor or any of their respective Subsidiaries is a party requiring, and there is no membership interest or other Equity Interests of the Borrower, a Non-Subsidiary Guarantor or any of their respective Subsidiaries outstanding which upon conversion or exchange would require, the issuance by the Borrower, a Non-Subsidiary Guarantor or any of their respective Subsidiaries of any additional membership interests or other Equity Interests of the Borrower, a Non-Subsidiary Guarantor or any of their respective Subsidiaries or other Securities convertible into, exchangeable for or evidencing the right to subscribe for or purchase, a membership interest or other Equity Interests of the Borrower, a Non-Subsidiary Guarantor or any of their respective Subsidiaries.  Schedule 4.02 correctly sets forth the ownership interest of the Borrower, any Non-Subsidiary Guarantor and each of their respective Subsidiaries in their respective Subsidiaries as of the Closing Date.

 

Section 4.03          Due Authorization.   The execution, delivery and performance of the Loan Documents have been duly authorized by all necessary action on the part of each Loan Party that is a party thereto.

 

 

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Section 4.04          No Conflict.   The execution, delivery and performance by the Loan Parties of the Loan Documents to which they are parties and the consummation of the transactions contemplated by the Loan Documents do not and will not (a) violate (i) any provision of any law or any governmental rule or regulation applicable to any Loan Party or any of its Subsidiaries, (ii) any of the Organizational Documents of any Loan Party or any of its Subsidiaries or (iii) any order, judgment or decree of any court or other agency of government binding on any Loan Party or any of its Subsidiaries; (b) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of any Loan Party or any of its Subsidiaries except to the extent such conflict, breach or default could not reasonably be expected to have a Material Adverse Effect; (c) result in or require the creation or imposition of any Lien upon any of the properties or assets of any Loan Party or any of its Subsidiaries (other than any Liens created under any of the Loan Documents in favor of the Collateral Agent on behalf of the Secured Parties); or (d) require any approval of stockholders, members or partners or any approval or consent of any Person under any Contractual Obligation of any Loan Party or any of its Subsidiaries, except for such approvals or consents which have been obtained on or before the Closing Date and disclosed in writing to the Lenders and except for any such approvals or consents the failure of which to obtain will not have a Material Adverse Effect.

 

Section 4.05          Governmental Consents.   The execution, delivery and performance by the Loan Parties of the Loan Documents to which they are parties and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any Governmental Authority except for filings and recordings with respect to the Collateral to be made, or otherwise delivered to the Collateral Agent for filing and/or recordation, as of the Closing Date.

 

Section 4.06          Binding Obligation.   Each Loan Document has been duly executed and delivered by each Loan Party that is a party thereto and is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability.

 

Section 4.07          Historical Financial Statements.   The Historical Financial Statements were prepared in conformity with GAAP and fairly present, in all material respects, the financial position, on a consolidated basis, of the Persons described in such financial statements as at the respective dates thereof and the results of operations and cash flows, on a consolidated basis, of the entities described therein for each of the periods then ended, subject, in the case of any such unaudited financial statements, to changes resulting from audit and normal year-end adjustments.  As of the Closing Date, neither Holdings nor any of its Subsidiaries has any contingent liability or liability for Taxes, long-term lease or unusual forward or long-term commitment that is not reflected in the Historical Financial Statements or the notes thereto and which in any such case is material in relation to the business, operations, properties, assets, condition (financial or otherwise) or prospects of Holdings and its Subsidiaries taken as a whole.

 

Section 4.08          Projections.   On and as of the Closing Date, the projections of Holdings and its Subsidiaries for the period of Fiscal Year 2010 through and including Fiscal Year 2016 (the “Projections”) are based on good faith estimates and assumptions made by the management of Holdings; provided, that the Projections are not to be viewed as facts and that actual results during the period or periods covered by the Projections may differ from such Projections and that the differences may be material.

 

Section 4.09          No Material Adverse Change.   Since December 31, 2009, no event, circumstance or change has occurred that has caused or evidences, either in any case or in the aggregate, a Material Adverse Effect.

 

 

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Section 4.10          Certain Fees.   No broker’s or finder’s fee or commission shall be payable with respect to the transactions contemplated by the Loan Documents or the use of proceeds with respect thereto, except as payable to the Agents and Lenders.

 

Section 4.11          Adverse Proceedings, Etc.   There are no Adverse Proceedings, individually or in the aggregate, that could reasonably be expected to have a Material Adverse Effect.  No Loan Party nor any of its Subsidiaries (a) is in violation of any applicable laws (including Environmental Laws) that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect or (b) is subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of Governmental Authority, that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.

 

Section 4.12          Payment of Taxes.   Except as otherwise permitted under Section 5.03, all Tax returns and reports of each Loan Party and its Subsidiaries required to be filed by any of them have been timely filed, and all Taxes shown on such Tax returns to be due and payable and all assessments, fees, Taxes and other governmental charges upon each Loan Party and its Subsidiaries and upon their respective properties, assets, income, businesses and franchises which are due and payable have been paid when due and payable except those which are being contested in good faith by appropriate proceedings diligently conducted and for which adequate reserves or other appropriate provisions have been provided in accordance with GAAP.  There is no proposed Tax assessment against any Loan Party that would, if made, have a Material Adverse Effect.

 

Section 4.13          Properties.

 

(a)           Title.  Each Loan Party and its Subsidiaries has (i) good, sufficient and legal title to (in the case of fee interests in real property), (ii) valid leasehold interests in (in the case of leasehold interests in real or personal property), (iii) valid licensed rights in (in the case of licensed interests in intellectual property) and (iv) good title to (in the case of all other personal property), all of their respective properties and assets reflected in their respective Historical Financial Statements referred to in Section 4.07 and in the most recent financial statements delivered pursuant to Section 5.01, in each case except for assets disposed of since the date of such financial statements in the ordinary course of business or as otherwise permitted under Section 6.08.  Except as permitted by this Agreement, all such properties and assets are free and clear of Liens.

 

(b)           Real Estate.  As of the Closing Date, Schedule 4.13 contains a true, accurate and complete list of (i) all Real Estate Assets, and (ii) all leases, subleases or assignments of leases (together with all amendments, modifications, supplements, renewals or extensions of any thereof) affecting each Real Estate Asset of any Loan Party, regardless of whether such Loan Party is the landlord or tenant (whether directly or as an assignee or successor in interest) under such lease, sublease or assignment.  As of the Closing Date, each agreement listed in clause (ii) of the immediately preceding sentence is in full force and effect and such Loan Party does not have knowledge of any default that has occurred and is continuing thereunder, and each such agreement constitutes the legally valid and binding obligation of each applicable Loan Party, enforceable against such Loan Party in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles.

  

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(c)           Flood Zone Properties.  No Mortgage encumbers improved real property that is located in a Flood Zone (except any such property as to which flood insurance has been obtained and is in full force and effect as required by this Agreement).

 

Section 4.14          Environmental Matters.  Except as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect: (a) each Loan Party and each of its Subsidiaries is in compliance with all applicable Environmental Laws, and any past noncompliance has been fully resolved without any pending, on-going or future obligation or cost; (b) each Loan Party and each of its Subsidiaries has obtained and maintained in full force and effect all Governmental Authorizations required pursuant to Environmental Laws for the operation of their respective business; (c) there are and, to each Loan Party’s knowledge, are, and have been, no conditions, occurrences, violations of Environmental Law, or presence or Releases of Hazardous Materials which could reasonably be expected to form the basis of an Environmental Claim against any Loan Party or any of its Subsidiaries or related to any Real Estate Assets; (d) there are no pending Environmental Claims against any Loan Party or any of its Subsidiaries, and no Loan Party nor any of its Subsidiaries has received any written notification of any alleged violation of, or liability pursuant to, Environmental Law or responsibility for the Release or threatened Release of, or exposure to, any Hazardous Materials; and (e) no Lien imposed pursuant to any Environmental Law has attached to any Collateral and, to the knowledge of any Loan Party, no conditions exist that would reasonably be expected to result in the imposition of such a Lien on any Collateral.

 

Section 4.15          No Defaults.   No Loan Party nor any of its Subsidiaries is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any of its Contractual Obligations, and no condition exists which, with the giving of notice or the lapse of time or both, could constitute such a default, except where the consequences, direct or indirect, of such default or defaults, if any, could not reasonably be expected to have a Material Adverse Effect.  No Default or Event of Default has occurred and is continuing.

 

Section 4.16          Material Contracts.  All Material Contracts as in effect on the Closing Date are in full force and effect and no defaults currently exist thereunder.

 

Section 4.17          Governmental Regulation.  No Loan Party nor any of its Subsidiaries is subject to regulation under the Federal Power Act or the Investment Company Act of 1940 or under any other federal or state statute or regulation which may limit its ability to incur Indebtedness or which may otherwise render all or any portion of the Obligations unenforceable.  No Loan Party nor any of its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in the Investment Company Act of 1940.

 

Section 4.18          Margin Stock.  No Loan Party nor any of its Subsidiaries owns any Margin Stock.

 

 

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Section 4.19          Employee Matters.  No Loan Party nor any of its Subsidiaries is engaged in any unfair labor practice that could reasonably be expected to have a Material Adverse Effect.  There is (a) no unfair labor practice complaint pending against such Loan Party or any of its Subsidiaries, or to the best knowledge of such Loan Party, threatened against any of them before the National Labor Relations Board and no grievance or arbitration proceeding arising out of or under any collective bargaining agreement that is so pending against any Loan Party or any of its Subsidiaries or to the best knowledge of such Loan Party, threatened against any of them, (b) no strike or work stoppage in existence or threatened involving any Loan Party or any of its Subsidiaries and (c) to the best knowledge of such Loan Party, no union representation question existing with respect to the employees of any Loan Party or any of its Subsidiaries and, to the best knowledge of such Loan Party, no union organization activity that is taking place, except (with respect to any matter specified in clause (a), (b) or (c) above, either individually or in the aggregate) such as is not reasonably likely to have a Material Adverse Effect.

 

Section 4.20          Employee Benefit Plans.  Each Loan Party, each of its Subsidiaries and each of their respective ERISA Affiliates are in compliance in all material respects with all applicable provisions and requirements of ERISA and the Internal Revenue Code and the regulations and published interpretations thereunder with respect to each Employee Benefit Plan, and have performed all their obligations under each Employee Benefit Plan.  Each Employee Benefit Plan which is intended to qualify under Section 401(a) of the Internal Revenue Code has received a favorable determination letter from the Internal Revenue Service indicating that such Employee Benefit Plan is so qualified, or is maintained pursuant to a volume submitter or prototype document that is subject to a favorable advisory or opinion letter from the Internal Revenue Service, and nothing has occurred subsequent to the issuance of such determination, advisory or opinion letter, as the case may be, which would cause such Employee Benefit Plan to lose its qualified status.  No liability to the PBGC (other than required premium payments), the Internal Revenue Service, any Employee Benefit Plan (other than in the ordinary course) or any trust established under Title IV of ERISA has been or is expected to be incurred by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates with respect to any Employee Benefit Plan.  No ERISA Event has occurred or is reasonably expected to occur.  Except to the extent required under Section 4980B of the Internal Revenue Code or similar state laws, no Employee Benefit Plan provides health or welfare benefits (through the purchase of insurance or otherwise) for any retired or former employee of any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates.  The present value of the aggregate benefit liabilities under each Pension Plan sponsored, maintained or contributed to by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates (determined as of the end of the most recent plan year on the basis of the actuarial assumptions specified for funding purposes in the most recent actuarial valuation for such Pension Plan) did not exceed the aggregate current fair market value of the assets of such Pension Plan.  As of the most recent valuation date for each Multiemployer Plan, the potential liability of any Loan Party, its Subsidiaries and their respective ERISA Affiliates for a complete withdrawal from such Multiemployer Plan (within the meaning of Section 4203 or Section 4205 of ERISA), when aggregated with such potential liability for a complete withdrawal from all Multiemployer Plans, is zero.  Each Loan Party, each of its Subsidiaries and each of their ERISA Affiliates have complied with the requirements of Section 515 of ERISA with respect to each Multiemployer Plan and are not in material “default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.

  

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Section 4.21          Solvency.  Holdings and its Subsidiaries, taken as a whole, are and upon the incurrence of any Obligation by any Loan Party on any date on which this representation and warranty is made, shall be, Solvent.

 

Section 4.22          Compliance with Statutes, Etc.  Each Loan Party and its Subsidiaries is in compliance with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all Governmental Authorities, in respect of the conduct of its business and the ownership of its assets and property, except such non-compliance that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

 

Section 4.23          Disclosure.  No representation or warranty of any Loan Party contained in any Loan Document or in any other documents, certificates or written statements furnished to any Agent or Lender by or on behalf of any Loan Party or any of its Subsidiaries for use in connection with the transactions contemplated hereby contains any untrue statement of a material fact or omits to state a material fact (known to such Loan Party, in the case of any document not furnished by either of them) necessary in order to make the statements contained herein or therein not misleading in light of the circumstances in which the same were made.  Any projections and pro forma financial information contained in such materials are based upon good faith estimates and assumptions believed by the Loan Parties to be reasonable at the time made, it being recognized by Lenders that such projections as to future events are not to be viewed as facts and that actual results during the period or periods covered by any such projections may differ from the projected results and such differences may be material.  There are no facts known (or which should upon the reasonable exercise of diligence be known) to the Loan Parties (other than matters of a general economic nature) that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect and that have not been disclosed herein or in such other documents, certificates and statements furnished to Lenders for use in connection with the transactions contemplated hereby.

 

Section 4.24          PATRIOT Act.  To the extent applicable, each Loan Party is in compliance, in all material respects, with (i) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto, and (ii) the PATRIOT Act.  No part of the proceeds of the Loans shall be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

 

Section 4.25          Intellectual Property.  Except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (i) each of the Loan Parties owns, or is licensed to use, all Intellectual Property necessary for or used in the conduct of its business as currently conducted, (ii) no claim has been asserted and is pending by any Person challenging or questioning the ownership, registration or use of any Intellectual Property of the Loan Parties or the validity or effectiveness of any Intellectual Property of the Loan Parties, nor does any Loan Party know of any valid basis for any such claim and (iii) to the best of the Borrower’s knowledge, the use of Intellectual Property by each of the Loan Parties does not infringe on the rights of any Person in any material respect.

 

 

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Section 4.26         Health Care Matters.

 

(a)          Compliance with Health Care Laws; Permits.

 

(i)           Each Loan Party and each of their Subsidiaries, and any Person acting on their behalf, is and at all times has been in compliance in all material respects with all Health Care Laws applicable to it, its products and its properties or other assets or its business or operation, including its provision of professional services.  None of the Loan Parties or any of their Subsidiaries has received any written or oral notice from any Governmental Authority, including, without limitation, the Food and Drug Administration, the Centers for Medicare & Medicaid Services, and the Department of Health and Human Services Office of Inspector General, of potential or actual non-compliance by, or liability of, any of the Loan Parties or any of their Subsidiaries, under any Health Care Law.

 

(ii)           Each Loan Party and each of their Subsidiaries, and any Person acting on their behalf, has in effect all Permits, including, without limitation, all Permits necessary for it to own, lease or operate its properties and other assets and to carry on its business and operations, including its provision of professional services, as presently conducted.  All such Permits are in full force and effect and there has occurred no default under, or violation of, any such Permit, and each Loan Party and each of their Subsidiaries are in material compliance with each such Permit held by or issued to it.  Except as set forth on Schedule 4.26, no action, demand, requirement or investigation by any Governmental Authority and no suit, action or proceeding by any other person, in each case with respect to each Loan Party, each of their Subsidiaries, any Person acting on their behalf, or any of their respective properties, other assets or provision of professional services under any Requirements of Law, is pending or, to the knowledge of each Loan Party and their Subsidiaries, threatened.  None of the Loan Parties or any of their Subsidiaries has received any written or oral notice from any Governmental Authority that it intends to or is threatening to revoke, suspend, modify or materially limit any Permit.

 

(b)          Filings.  All reports, documents, claims, notices or approvals required to be filed, obtained, maintained or furnished to any Governmental Authority have been so filed, obtained, maintained or furnished, and all such reports, documents, claims and notices were complete and correct in all material respects on the date filed (or were corrected in or supplemented by a subsequent filing).

 

(c)          Material Statements.  No Loan Party nor any of their Subsidiaries, nor any officer, affiliate, employee or agent of any Loan Party or any of their Subsidiaries, has made an untrue statement of a material fact or fraudulent statement to any Governmental Authority, failed to disclose a material fact required to any Governmental Authority, or committed an act, made a statement, or failed to make a statement that, at the time such disclosure was made, would reasonably be expected to constitute a violation of any Health Care Law.  No Loan Party nor any of their Subsidiaries, nor any officer, affiliate, employee or agent of any Loan Party or any of their Subsidiaries, has made any untrue statement of fact regarding claims incurred but not reported.

 

 

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(d)           Billing.  Each Loan Party, each of their Subsidiaries and each contracting physician of each Loan Party or any of their Subsidiaries (to the extent required) has the requisite provider number or other Permit to participate, submit claims to and receive payments from the Medicare program (to the extent such entity participates in the Medicare program), the respective Medicaid program in the state or states in which such entity operates, and all other Third Party Payor Programs, including but not limited to Capitated Contracts with managed care organizations, that each Loan Party and each of their Subsidiaries currently bill.  Each Loan Party and their Subsidiaries, as applicable, meet all requirements of participation, claims submission and payment of the Third Party Payor Programs and is a party to valid participation agreements for payment by such Third Party Payor Programs.  There is no investigation, audit, claim review, or other action pending, or to the knowledge of any Loan Party or their Subsidiaries, threatened which could result in a revocation, suspension, termination, probation, restriction, limitation, or non-renewal of any Third Party Payor provider number or result in any Loan Party’s or any of their Subsidiaries’ exclusion from any Third Party Payor Program.  No Loan Party nor any of their Subsidiaries has billed or received any payment or reimbursement in excess of amounts allowed by any Health Care Law or other law.  For purposes of this Agreement, a “Third Party Payor” means Medicare, Medicaid, TRICARE, Blue Cross and/or Blue Shield, state government insurers, private insurers and any other person or entity which presently or in the future maintains Third Party Payor Programs.  In addition, for purposes of this Agreement, “Third Party Payor Programs” means all third party payor programs in which Borrower, each of the Loan Parties and each of its Subsidiaries participates (including, without limitation, Medicare, Medicaid, TRICARE or any other federal or state health care programs, as well as Blue Cross and/or Blue Shield, managed care plans, or any other private insurance programs).

 

(e)           Contracted Providers.  Each Loan Party and their Subsidiaries is in material compliance with all applicable material Health Care Laws regarding the selection, deselection, and credentialing of contracted providers, including, but not limited to, verification of licensing status and eligibility for reimbursement under the Third Party Payor Programs.  All contracted providers of each Loan Party and their Subsidiaries are properly licensed and hold appropriate Permits and clinical privileges, as applicable, for the professional services which they provide, and, with respect to providers that perform services eligible for reimbursement under any Third Party Payor Program, are not debarred or excluded from any such Third Party Payor Program.

 

(f)           Proceedings.  There are no facts, circumstances or conditions that would reasonably be expected to form the basis for any material investigation, suit, claim, audit, action (legal or regulatory) or proceeding (legal or regulatory) by a Governmental Authority against or affecting any Loan Party or any of their Subsidiaries relating to any of the Health Care Laws.

 

 

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(g)           Prohibited Transactions.  No Loan Party, any of their Subsidiaries or any Person acting on behalf of any Loan Party or any of their Subsidiaries is a party to any contract, lease agreement or other arrangement (including any joint venture, service or consulting agreement) with any physician, physician group, health care facility, hospital, nursing facility, home health agency or other person who is in a position to make or influence referrals to or otherwise generate business to provide services, lease space, lease equipment or engage in any other venture or activity, other than agreements which are in compliance with all applicable Health Care Laws.  No Loan Party, any of their Subsidiaries, or any person acting on behalf of any Loan Parties or any their Subsidiaries, directly or indirectly: (1) offered or paid any remuneration, in cash or in kind, to, or made any financial arrangements with, any past, present or potential patient, supplier, medical staff member, contractor or Third Party Payor of any Loan Parties and/or any of their Subsidiaries in order to illegally obtain business or payments from such person; (2) given or agreed to give, or is aware that there has been made or that there is any illegal agreement to make, any illegal gift or gratuitous payment of any kind, nature or description (whether in money, property or services) to any past, present or potential patient, supplier, contractor, Third Party Payor or any other person; (3) made or agreed to make, or is aware that there has been made or that there is any agreement to make, any contribution, payment or gift of funds or property to, or for the private use of, any governmental official, employee or agent where either the contribution, payment or gift or the purpose of such contribution, payment or gift is or was illegal under the laws of any government entity having jurisdiction over such payment, contribution or gift; (4) established or maintained any unrecorded fund or asset for any purpose or made any misleading, false or artificial entries on any of its books or records for any reason; or (5) made, or agreed to make, or is aware that there has been made or that there is any agreement to make, any payment to any person with the intention or understanding that any part of such payment would be used or was given for any purpose other than that described in the documents supporting such payment.

 

(h)           Fair Market Value.  The compensation paid or to be paid by each Loan Party and each of their Subsidiaries to any physician or physician group who is employed by or contracted with each Loan Party or any of their Subsidiaries is fair market value for the services and items actually provided by such physician, not taking into account the value or volume of referrals or other business generated by such physicians or physician groups for each Loan Party or each of their Subsidiaries.  Each Loan Party and each of their Subsidiaries has at all times maintained a written agreement with each physician or physician group receiving compensation from each Loan Party or any of their Subsidiaries.

 

(i)            Medicare/Medicaid.  There are no Medicare or Medicaid termination proceedings underway with respect to any of the Loan Parties, each entity meets the Medicare conditions of participation and, to our knowledge after such reasonable investigation under the circumstances, no employee or independent contractor of any Loan Parties has been excluded in participating in Medicare or Medicaid or any similar federal programs.

 

(j)            Compliance.  Each Loan Party possesses and implements all necessary policies and procedures to ensure that all aspects of each Loan Party’s operations, their employees, and all healthcare providers under contract with any Loan Party, comply with all applicable Health Care Laws.

 

(k)           Corporate Integrity Agreements, etc.  No Loan Party, nor any of their Subsidiaries, is a party to any corporate integrity agreements, monitoring agreements, consent decrees, settlement orders, or similar agreement with or imposed by any Governmental Authority.

  

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ARTICLE V.

AFFIRMATIVE COVENANTS

 

Each Loan Party covenants and agrees that, so long as any Commitment is in effect and until payment in full of all Obligations (other than (x) obligations under Hedge Agreements not yet due and payable and (y) contingent indemnification obligations not yet due and payable) and cancellation or expiration of all Letters of Credit (or collateralization thereof in a manner acceptable to the Issuing Bank), such Loan Party shall, and shall cause each of its Subsidiaries to:

 

Section 5.01         Financial Statements and Other Reports.  In the case of Holdings, deliver to the Administrative Agent (which shall furnish to each Lender):

 

(a)           Quarterly Financial Statements.  As soon as available, and in any event within 45 days after the end of each Fiscal Quarter of each Fiscal Year, commencing with the Fiscal Quarter in which the Closing Date occurs, the consolidated balance sheets of Holdings and its Subsidiaries as at the end of such Fiscal Quarter and the related consolidated statements of income, stockholders’ equity and cash flows of Holdings and its Subsidiaries for such Fiscal Quarter and for the period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in comparative form the corresponding figures for the corresponding periods of the previous Fiscal Year, commencing with the first Fiscal Quarter for which such corresponding figures are available, all in reasonable detail, together with a Financial Officer Certification and a Narrative Report with respect thereto;

 

(b)           Annual Financial Statements.  As soon as available, and in any event within 90 days (or if Holdings files an extension with the SEC 105 days) after the end of each Fiscal Year, commencing with the Fiscal Year in which the Closing Date occurs, (i) the consolidated balance sheets of Holdings and its Subsidiaries as at the end of such Fiscal Year and the related consolidated statements of income, stockholders’ equity and cash flows of Holdings and its Subsidiaries for such Fiscal Year, setting forth in each case in comparative form the corresponding figures for the previous Fiscal Year, commencing with the first Fiscal Year for which such corresponding figures are available covered by such financial statements, in reasonable detail, together with a Financial Officer Certification and a Narrative Report with respect thereto; and (ii) with respect to such consolidated financial statements a report thereon of an independent certified public accountants of recognized national standing selected by Holdings, and reasonably satisfactory to the Administrative Agent (which report and/or the accompanying financial statements shall be unqualified as to going concern and scope of audit, and shall state that such consolidated financial statements fairly present, in all material respects, the consolidated financial position of Holdings and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise disclosed in such financial statements) and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards);

  

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(c)           Compliance Certificate.  Together with each delivery of financial statements of Holdings and its Subsidiaries pursuant to Sections 5.01(a) and 5.01(b), a duly executed and completed Compliance Certificate;

 

(d)           Statements of Reconciliation after Change in Accounting Principles.  If, as a result of any change in accounting principles and policies from those used in the preparation of the Historical Financial Statements, the consolidated financial statements of Holdings and its Subsidiaries delivered pursuant to Section 5.01(a) or 5.01(b) shall differ in any material respect from the consolidated financial statements that would have been delivered pursuant to such subdivisions had no such change in accounting principles and policies been made, then, together with the first delivery of such financial statements after such change, one or more statements of reconciliation for all such prior financial statements in form and substance satisfactory to the Administrative Agent;

 

(e)           Notice of Default.  Promptly upon any officer of any Loan Party obtaining knowledge (i) of any condition or event that constitutes a Default or an Event of Default or that notice has been given to any Loan Party with respect thereto; (ii) that any Person has given any notice to any Loan Party or any of its Subsidiaries or taken any other action with respect to any event or condition set forth in Section 8.01(b); or (iii) of the occurrence of any event or change that has caused or evidences, either in any case or in the aggregate, a Material Adverse Effect, a certificate of an Authorized Officer specifying the nature and period of existence of such condition, event or change, or specifying the notice given and action taken by any such Person and the nature of such claimed Event of Default, Default, default, event or condition, and what action the Borrower (or such Loan Party) has taken, is taking and proposes to take with respect thereto;

 

(f)           Notice of Litigation.  Promptly upon any officer of any Loan Party obtaining knowledge of (i) any Adverse Proceeding not previously disclosed in writing by the Borrower to the Lenders or (ii) any development in any Adverse Proceeding that, in the case of either clause (i) or (ii), if adversely determined could be reasonably expected to have a Material Adverse Effect, or seeks to enjoin or otherwise prevent the consummation of, or to recover any damages or obtain relief as a result of, the transactions contemplated hereby, or the exercise of rights or performance of obligations under any Loan Document, written notice thereof together with such other information as may be reasonably available to Holdings or the Borrower to enable the Lenders and their counsel to evaluate such matters;

 

(g)           ERISA.  (i) Promptly upon the occurrence of or upon any officer of any Loan Party becoming aware of the forthcoming occurrence of (A) any ERISA Event, (B) the adoption of any new Pension Plan by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates, (C) the adoption of an amendment to a Pension Plan if such amendment results in a material increase in benefits or unfunded liabilities or (D) the commencement of contributions by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates to a Multiemployer Plan or Pension Plan, a written notice specifying the nature thereof, what action such Loan Party, its Subsidiaries or any of their respective ERISA Affiliates has taken, is taking or proposes to take with respect thereto and, when known, any action taken or threatened by the Internal Revenue Service, the Department of Labor or the PBGC with respect thereto; and (ii) with reasonable promptness, copies of (A) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed by Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates with the Internal Revenue Service with respect to each Pension Plan; (B) all notices received by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event; and (C) copies of such other documents or governmental reports or filings relating to any Employee Benefit Plan as the Administrative Agent shall reasonably request;

  

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(h)           Financial Plan.  As soon as practicable and in any event no later than the last day of each Fiscal Year, a consolidated plan and financial forecast for the following Fiscal Year (a “Financial Plan”), including (1) a forecasted consolidated balance sheet and forecasted consolidated statements of income and cash flows of Holdings and its Subsidiaries for each Fiscal Year, and an explanation of the assumptions on which such forecasts are based and (2) forecasted consolidated statements of income and cash flows of Holdings and its Subsidiaries for each quarter of such Fiscal Year;

 

(i)           Insurance Report.  As soon as practicable and in any event by the last day of each Fiscal Year, a certificate from the Loan Parties’ insurance broker(s) in form and substance satisfactory to the Administrative Agent outlining all material insurance coverage maintained as of the date of such certificate by the Loan Parties and their Subsidiaries;

 

(j)           Information Regarding Collateral.

 

(i)           the Borrower shall furnish to the Collateral Agent prompt written notice of any change (A) in any Loan Party’s corporate name, (B) in any Loan Party’s identity or corporate structure, (C) in any Loan Party’s jurisdiction of organization or (D) in any Loan Party’s Federal Taxpayer Identification Number or state organizational identification number.  Each Loan Party agrees not to effect or permit any change referred to in the preceding sentence unless all filings have been made under the UCC or otherwise that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral as contemplated in the Security Documents; and

 

(ii)           Each Loan Party also agrees promptly to notify (or to have the Borrower notify on its behalf) the Collateral Agent if any material portion of the Collateral is damaged or destroyed;

 

(k)           Annual Collateral Verification.  Each year, at the time of delivery of annual financial statements with respect to the preceding Fiscal Year pursuant to Section 5.01(b), each Loan Party shall deliver to the Collateral Agent a certificate of its Authorized Officer (i) either confirming that there has been no change in such information since the date of the Perfection Certificate delivered on the Closing Date or the date of the most recent certificate delivered pursuant to this Section and/or identifying such changes and (ii) certifying that all Uniform Commercial Code financing statements (including fixtures filings, as applicable) and all supplemental intellectual property security agreements or other appropriate filings, recordings or registrations, have been filed of record in each governmental, municipal or other appropriate office in each jurisdiction identified pursuant to clause (i) above (or in such Perfection Certificate) to the extent necessary to effect, protect and perfect the security interests under the Security Documents for a period of not less than 18 months after the date of such certificate (except as noted therein with respect to any continuation statements to be filed within such period);

  

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(l)            Management Letters.  Promptly after the receipt thereof by Holdings or the Borrower or any of their respective Subsidiaries, a copy of any “management letter” received by any such Person from its certified public accountants and the management’s response thereto;

 

(m)          Certification of Public Information.  Holdings and each Lender acknowledge that certain of the Lenders may be “public-side” Lenders (Lenders that do not wish to receive material non-public information with respect to Holdings, its Subsidiaries or their securities) and, if documents or notices required to be delivered pursuant to this Section 5.01 or otherwise are being distributed through IntraLinks/IntraAgency, SyndTrak or another relevant website or other information platform (the “Platform”), any document or notice that Holdings has indicated contains Non-Public Information shall not be posted on that portion of the Platform designated for such public-side Lenders.  Holdings agrees to clearly designate all Information provided to the Administrative Agent by or on behalf of Holdings which is suitable to make available to Public Lenders.  If Holdings has not indicated whether a document or notice delivered pursuant to this Section 5.01 contains Non-Public Information, the Administrative Agent reserves the right to post such document or notice solely on that portion of the Platform designated for Lenders who wish to receive material non-public information with respect to Holdings, its Subsidiaries and their securities;

 

(n)           Defaults Under Material Contracts.  Promptly upon any officer of any Loan Party or any of its Subsidiaries obtaining knowledge of any condition or event that constitutes a default or an event of default under any Material Contract or that notice has been given to any Loan Party or any of its Subsidiaries with respect thereto, a certificate of an Authorized Officer of such Loan Party specifying the nature and period of existence of such condition or event and the nature of such claimed default or event of default, and what action such Loan Party or the Borrower has taken, is taking and proposes to take with respect thereto;

 

(o)           Credit Ratings.  Prompt written notice of any change in the Borrower’s corporate rating by S&P, in the Borrower’s corporate family rating by Moody’s or in the ratings of the credit facilities hereunder by S&P or Moody’s, or any notice from either such agency indicating its intent to effect such a change or to place the Borrower or the credit facilities hereunder on a “CreditWatch” or “WatchList” or any similar list, in each case with negative implications, or its cessation of, or its intent to cease, rating the Borrower or the credit facilities hereunder; and

 

(p)           Other Information.  (A) Promptly upon their becoming available, copies of (i) all financial statements, reports, notices and proxy statements sent or made available generally by Holdings or any of its Subsidiaries to their security holders acting in such capacity, (ii) all regular and periodic reports and all registration statements and prospectuses, if any, filed by Holdings or any of its Subsidiaries with any securities exchange or with the SEC or any governmental or private regulatory authority and (iii) all press releases and other statements made available generally by Holdings or any of its Subsidiaries to the public concerning material developments in the business of Holdings or any of its Subsidiaries and (B) such other information and data with respect to Holdings or any of its Subsidiaries as from time to time may be reasonably requested by the Administrative Agent or any Lender.

  

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Section 5.02         Existence.  Except as otherwise permitted under Section 6.08, at all times preserve and keep in full force and effect its existence and all rights and franchises, licenses and permits material to its business; provided, that no Loan Party (other than the Borrower with respect to existence) or any of its Subsidiaries shall be required to preserve any such existence, right or franchise, licenses and permits if such Person’s board of directors (or similar governing body) shall determine that the preservation thereof is no longer desirable in the conduct of the business of such Person and that the loss thereof is not disadvantageous in any material respect to such Person or to Lenders.

 

Section 5.03         Payment of Taxes and Claims.  Pay all Taxes imposed upon it or any of its properties or assets or in respect of any of its income, businesses or franchises before any penalty or fine accrues thereon, and all claims (including claims for labor, services, materials and supplies) for sums that have become due and payable and that by law have or may become a Lien upon any of its properties or assets, prior to the time when any penalty or fine shall be incurred with respect thereto; provided, that no such Tax or claim need be paid if it is being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as (a) adequate reserves or other appropriate provisions as shall be required in conformity with GAAP shall have been made therefor and (b) in the case of a Tax or claim which has or may become a Lien against any of the Collateral, such contest proceedings conclusively operate to stay the sale of any portion of the Collateral to satisfy such Tax or claim.  No Loan Party shall, nor shall it permit any of its Subsidiaries to, file or consent to the filing of any consolidated income tax return with any Person (other than Holdings or any of its Subsidiaries).

 

Section 5.04         Maintenance of Properties.  Maintain or cause to be maintained in good repair, working order and condition, ordinary wear and tear excepted, all material properties used or useful in the business of the Loan Parties and their Subsidiaries and from time to time shall make or cause to be made all appropriate repairs, renewals and replacements thereof.

 

Section 5.05         Insurance.  In the case of Holdings, maintain or cause to be maintained, with financially sound and reputable insurers, such public liability insurance, third party property damage insurance, business interruption insurance and casualty insurance with respect to liabilities, losses or damage in respect of the assets, properties and businesses of the Loan Parties and their Subsidiaries as may customarily be carried or maintained under similar circumstances by Persons of established reputation engaged in similar businesses, in each case in such amounts (giving effect to self-insurance), with such deductibles, covering such risks and otherwise on such terms and conditions as are customary for such Persons.  Each such policy of insurance shall (i) name the Secured Parties, as additional insureds thereunder as their interests may appear, (ii) in the case of each casualty insurance policy, contain a loss payable clause or endorsement, satisfactory in form and substance to the Collateral Agent, that names the Collateral Agent, on behalf of the Secured Parties, as the loss payee thereunder and (iii) provide that the insurer affording coverage (with respect to property and liability insurance) will provide for at least thirty (30) days’ prior written notice to the Collateral Agent of any modification or cancellation of such policy.

  

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Section 5.06        Books and Records; Inspections.  Maintain proper books of record and accounts in which full, true and correct entries in conformity in all material respects with GAAP shall be made of all dealings and transactions in relation to its business and activities.  Each Loan Party shall, and shall cause each of its Subsidiaries to, permit any authorized representatives designated by the Administrative Agent to visit and inspect any of the properties of any Loan Party where its financial and accounting records are maintained, to inspect, copy and take extracts from its and their financial and accounting records and to discuss its and their affairs, finances and accounts with its and their officers and independent public accountants, all upon reasonable prior notice and at such reasonable times during normal business hours and as often as may reasonably be requested.

 

Section 5.07        Lenders’ Meetings.  In the case of each of Holdings and the Borrower, upon the request of the Administrative Agent or the Required Lenders and at the sole expense of the Borrower, participate in a conference call or meeting of the Administrative Agent and the Lenders once during each Fiscal Year to be held, in the case of a meeting, at the Borrower’s corporate offices (or at such other location as may be agreed to by the Borrower and the Administrative Agent) at such time as may be agreed to by the Borrower and the Administrative Agent.

 

Section 5.08        Compliance with Contractual Obligations and Laws.  Comply, and use best efforts to cause all other Persons, if any, on or occupying any Facilities to comply, with the requirements of all Contractual Obligations and all applicable laws, rules, regulations and orders of any Governmental Authority (including all Environmental Laws), noncompliance with which could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

Section 5.09        Environmental Compliance.  Use and operate all of its Facilities in compliance with all Environmental Laws, keep all necessary Governmental Authorizations required pursuant to any Environmental Laws, and handle all Hazardous Materials in compliance with all Environmental Laws, in each case except where the failure to comply with the terms of this clause could not reasonably be expected to have a Material Adverse Effect.

 

Section 5.10         Subsidiaries.  In the case of the Borrower, in the event that any Person becomes a Subsidiary of the Borrower (other than an Excluded Foreign Subsidiary) after the date hereof, (a) promptly cause such Subsidiary to become a Guarantor hereunder and a Grantor under the Pledge and Security Agreement by executing and delivering to the Administrative Agent and the Collateral Agent a Counterpart Agreement, and (b) take all such actions and execute and deliver, or cause to be executed and delivered, all such documents, instruments, agreements, and certificates as are similar to those described in Sections 3.01(b), 3.01(h), and 3.01(j).

 

(b)           In the case of the Borrower, with respect to any new Foreign Subsidiary created or acquired after the Closing Date by the Borrower or any of its Subsidiaries, promptly execute deliver, all such documents, instruments, agreements, and certificates as are similar to those described in Sections 3.01(b), and the Borrower shall take all of the actions referred to in Section 3.01(h) necessary to grant and to perfect a First Priority Lien in favor of the Collateral Agent, for the benefit of Secured Parties, under the Pledge and Security Agreement in the Equity Interests of such new Subsidiary that is owned by the Borrower or any of its Subsidiaries (provided that in no event shall more than 66.0% of the voting Equity Interests of any new Excluded Foreign Subsidiary be required to be so pledged).

  

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(c)           With respect to each new Subsidiary, the Borrower shall promptly send to the Collateral Agent written notice setting forth with respect to such Person (i) the date on which such Person became a Subsidiary of the Borrower and (ii) all of the data required to be set forth in Schedules 4.01 and 4.02 with respect to all Subsidiaries of the Borrower; and such written notice shall be deemed to supplement Schedules 4.01 and 4.02 for all purposes hereof.

 

Section 5.11         Additional Material Real Estate Assets.  In the event that any Loan Party acquires a Material Real Estate Asset or a Real Estate Asset owned or leased on the Closing Date becomes a Material Real Estate Asset and such interest has not otherwise been made subject to the Lien of the Security Documents in favor of the Collateral Agent, for the benefit of Secured Parties, in the case of such Loan Party, promptly take all such actions and execute and deliver, or cause to be executed and delivered, all such mortgages, documents, instruments, agreements, opinions and certificates similar to those described on Schedule 5.11 with respect to each such Material Real Estate Asset that the Collateral Agent shall reasonably request to create in favor of the Collateral Agent, for the benefit of Secured Parties, a valid and, subject to any filing and/or recording referred to herein, perfected First Priority security interest in such Material Real Estate Assets.  In addition, upon the Collateral Agent’s request, such Loan Party shall deliver to the Collateral Agent a copy of all consultant’s reports, environmental site assessments or other material documents in possession of the Loan Parties to determine if such Material Real Estate Asset is subject to material Environmental Claims.

 

Section 5.12         Additional Collateral.  With respect to any assets or property acquired after the Closing Date by Holdings, the Borrower or any of its Subsidiaries (other than (x) any assets or property described in Section 5.10 or Section 5.11, (y) any assets or property subject to a Lien expressly permitted by Section 6.02 (m) or (l) and (z) assets or property acquired by an Excluded Foreign Subsidiary) as to which the Collateral Agent, for the benefit of the Secured Parties, does not have a perfected First Priority Lien, promptly (i) execute and deliver to the Collateral Agent such amendments to the Pledge and Security Agreement or such other documents as the Collateral Agent deems necessary or advisable to grant to the Collateral Agent, for the benefit of the Secured Parties, a perfected First Priority Lien in such assets or property and (ii) take all actions necessary or advisable to grant to the Collateral Agent, for the benefit of the Secured Parties, a perfected First Priority Lien in such assets or property, including without limitation, authorizing the Collateral Agent to file UCC financing statements in such jurisdictions as may be required by the Pledge and Security Agreement or by law.

  

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Section 5.13        Further Assurances.  At any time or from time to time upon the reasonable request of the Administrative Agent, at the expense of the Loan Parties, promptly execute, acknowledge and deliver such further documents and do such other acts and things as the Administrative Agent or the Collateral Agent may reasonably request in order to effect fully the purposes of the Loan Documents or to more fully perfect or renew the rights of the Administrative Agent, the Collateral Agent or the Lenders with respect to the Collateral (or with respect to any additions thereto or replacements or proceeds thereof or with respect to any other property or assets hereafter acquired by the Borrower or any Subsidiary which may be deemed to be part of the Collateral).  In furtherance and not in limitation of the foregoing, each Loan Party shall take such actions as the Administrative Agent or the Collateral Agent may reasonably request from time to time to ensure that the Obligations are guarantied by the Guarantors and are secured by substantially all of the assets of Holdings and its Subsidiaries and all of the outstanding Equity Interests of the Borrower and its Subsidiaries including taking all actions necessary to assist and cooperate with the Administrative Agent in the preparation and completion of a collateral audit by the Administrative Agent (subject to limitations contained in the Loan Documents with respect to Foreign Subsidiaries); provided that the Borrower shall not be required to pay for more than one collateral audit per year in the absence of any Event of Default.  Upon the exercise by the Administrative Agent or the Collateral Agent of any power, right, privilege or remedy pursuant to this Agreement or the other Loan Documents which required any consent, approval, recording, qualification or authorization of any Governmental Authority, the Borrower will execute and deliver, or will cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that the Administrative Agent or the Collateral Agent may be required to obtain from Holdings or any of its Subsidiaries for such consent, approval, recording, qualification or authorization.

 

Section 5.14         Control Accounts; Approved Deposit Accounts.  Each Loan Party shall (i) deposit in an Approved Deposit Account all Cash it receives, (ii) not establish or maintain any Securities Account or Commodities Account that is not a Control Account and (iii) not establish or maintain any Deposit Account other than an Approved Deposit Account, provided however that notwithstanding the foregoing, each Loan Party may (w) maintain zero-balance accounts for the purpose of managing local disbursements and collections and may maintain payroll, withholding tax and other fiduciary accounts, (x) maintain accounts into which amounts are paid by a governmental entity pursuant to one or more Health Care Laws so long as the amounts on deposit therein are transferred each Business Day to an Approved Deposit Account or any other account permitted to be so utilized under this Section 5.14, (y) maintain other accounts as long as the aggregate monthly average daily balance over the immediately preceding 12-month period for all such Loan Parties in all such other accounts does not exceed $3,000,000 at any time and (z) make pledges or cash deposits permitted by Section 6.02.

 

Section 5.15         Maintenance of Ratings.  In the case of the Borrower, at all times use commercially reasonable efforts to maintain public ratings issued by Moody’s and S&P with respect to its senior secured debt.

 

Section 5.16         Compliance with Healthcare Laws.  Within five (5) Business Days after any Loan Party obtaining knowledge thereof:

 

(a)           notice of any material investigation or audit, or pending or threatened proceedings relating to any violation by any Loan Party, any of their Subsidiaries, or any health care facility to which any Loan Party or any their Subsidiaries provides services, of any Health Care Laws (including, without limitation, any investigation or audit or proceeding involving violation of any of the Medicare and/or Medicaid fraud and abuse provisions);

  

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(b)           copies of any written recommendation from any Governmental Authority or other regulatory body that any Loan Party or any of their Subsidiaries, or any obligor to which any Loan Party or any their Subsidiaries provides services should have its licensure, provider or supplier number, or accreditation suspended, revoked, or limited in any way, or have its eligibility to participate in TRICARE, Medicare or Medicaid or to accept assignments or rights to reimbursement under TRICARE, Medicaid or Medicare regulations suspended, revoked, or limited in any way;

 

(c)           notice of any claim to recover any alleged material overpayments with respect to any receivables including, without limitation, payments received from TRICARE, Medicare, Medicaid or from any private insurance carrier;

 

(d)           notice of termination of eligibility of any Loan Party, any Subsidiary of any Loan Party, or any health care facility to which any Loan Party provides services to participate in any reimbursement program of any private insurance carrier, managed care or similar organization, or other obligor applicable to it;

 

(e)           notice of any material reduction in the level of reimbursement expected to be received with respect to any Receivables;

 

(f)           notice of any reimbursement payment contract or process that results or is reasonably expected to result in any claim against a Loan Party or any Subsidiary of such Loan Party (including on account of overpayments, settlement payments, appeals, repayment plan requests);

 

(g)           copies of any report or communication from any Governmental Authority in connection with any inspection of any facility of a Loan Party or any Subsidiary of such Loan Party other than those which are routine and non-material; and

 

(h)           notice of any healthcare provider’s fees being contested or disputed.

 

ARTICLE VI.

NEGATIVE COVENANTS

 

Each Loan Party covenants and agrees that, so long as any Commitment is in effect and until payment in full of all Obligations (other than (x) obligations under Hedge Agreements not yet due and payable and (y) contingent indemnification obligations not yet due and payable) and cancellation or expiration of all Letters of Credit (or collateralization thereof in a manner acceptable to the Issuing Bank), such Loan Party shall not, nor shall it cause or permit any of its Subsidiaries to:

 

Section 6.01         Indebtedness.   Directly or indirectly, create, incur, assume or guaranty, or otherwise become or remain directly or indirectly liable with respect to any Indebtedness, except:

 

(a)           the Obligations;

 

(b)           Indebtedness of any Subsidiary owed to the Borrower or to any other Subsidiary, or of the Borrower owed to any Subsidiary; provided, that (i) all such Indebtedness shall be evidenced by the Intercompany Note, and, if owed to a Loan Party, shall be subject to a First Priority Lien pursuant to the Pledge and Security Agreement, (ii) all such Indebtedness shall be unsecured and subordinated in right of payment to the payment in full of the Obligations pursuant to the terms of the Intercompany Note, (iii) any payment by any such Subsidiary Guarantor under any guaranty of the Obligations shall result in a pro tanto reduction of the amount of any Indebtedness owed by such Subsidiary to the Borrower or to any of its Subsidiaries for whose benefit such payment is made and (iv) such Indebtedness is permitted as an Investment under Section 6.06(d);

  

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(c)          Unsecured Indebtedness that (i) matures after, and does not require any scheduled amortization, mandatory redemption, sinking fund obligation or other scheduled payments of principal prior to, the date which is six months after the Term Loan Maturity Date (it being understood that such Indebtedness may have mandatory prepayment, repurchase or redemptions provisions satisfying the requirement of clause (ii) hereof), (ii) has terms and conditions (other than interest rate, redemption premiums and subordination terms), taken as a whole, that are not materially less favorable to the Borrower than the terms and conditions customary at the time for high-yield senior unsecured debt securities issued in a public offering, and (iii) does not require a Subsidiary of Holdings other than the Borrower and the Subsidiary Guarantors to be an obligor with respect to such Indebtedness; provided, that (1) both immediately prior and after giving effect to the incurrence thereof, (x) no Default or Event of Default shall exist or result therefrom and (y) Holdings shall be in compliance with the Senior Unsecured Incurrence Test (on a pro forma basis);

 

(d)          Indebtedness incurred by Holdings or any of its Subsidiaries arising from agreements providing for indemnification, adjustment of purchase price or similar obligations, or from guaranties or letters of credit, surety bonds or performance bonds securing the performance of the Borrower or any such Subsidiary pursuant to such agreements, in connection with Permitted Acquisitions or permitted dispositions of any business, assets or Subsidiary of Holdings or any of its Subsidiaries;

 

(e)          Indebtedness which may be deemed to exist pursuant to any guaranties, performance, surety, statutory, appeal or similar obligations incurred in the ordinary course of business;

 

(f)           Indebtedness in respect of netting services, overdraft protections and otherwise in connection with deposit accounts;

 

(g)         guaranties in the ordinary course of business of the obligations of suppliers, customers, franchisees, real property lessors and licensees of the Borrower and its Subsidiaries;

 

(h)          guaranties by the Borrower of Indebtedness of a Subsidiary Guarantor or guaranties by a Subsidiary Guarantor of Indebtedness of the Borrower or another Subsidiary Guarantor with respect, in each case, to Indebtedness otherwise permitted to be incurred pursuant to this Section 6.01; provided, that if the Indebtedness that is being guarantied is unsecured and/or subordinated to the Obligations, the guaranty shall also be unsecured and/or subordinated to the Obligations;

 

(i)           Indebtedness described in Schedule 6.01 and any Permitted Refinancing thereof;

  

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(j)           Indebtedness incurred during any Fiscal Year in an amount not to exceed $25,000,000 in the aggregate which is secured by purchase money Liens or incurred with respect to Capital Leases and purchase money Indebtedness; provided, that any such Indebtedness incurred with respect to purchase money (i) shall be secured only by the asset acquired in connection with the incurrence of such Indebtedness, and (ii) shall constitute not less than 75.0% of the aggregate consideration paid with respect to such asset;

 

(k)           (i) Indebtedness of a Person or Indebtedness attaching to assets of a Person that, in either case, becomes a Subsidiary or Indebtedness attaching to assets that are acquired by the Borrower or any of its Subsidiaries, in each case after the Closing Date as the result of a Permitted Acquisition, provided, that (x) such Indebtedness existed at the time such Person became a Subsidiary or at the time such assets were acquired and, in each case, was not created in anticipation thereof and (y) such Indebtedness is not guaranteed in any respect by Holdings or any of its Subsidiaries and (ii) any Permitted Refinancing thereof; provided, that (1) the direct and contingent obligors with respect to such Indebtedness are not changed and (2) such Indebtedness shall not be secured by any assets other than the assets securing the Indebtedness being renewed, extended or refinanced;

 

(l)           Indebtedness of the type described in clause (xi) of the definition thereof incurred in the ordinary course of business and not for speculation purposes; and

 

(m)         other unsecured Indebtedness of the Borrower and its Subsidiaries in an aggregate amount not to exceed at any time $25,000,000.

 

Section 6.02         Liens.  Directly or indirectly, create, incur, assume or permit to exist any Lien on or with respect to any property or asset of any kind (including any document or instrument in respect of goods or accounts receivable) of any Loan Party or any of its Subsidiaries, whether now owned or hereafter acquired or licensed, or any income, profits or royalties therefrom, or file or permit the filing of, or permit to remain in effect, any financing statement or other similar notice of any Lien with respect to any such property, asset, income, profits or royalties under the UCC of any State or under any similar recording or notice statute or under any applicable intellectual property laws, rules or procedures, except:

 

(a)           Liens in favor of the Collateral Agent for the benefit of Secured Parties granted pursuant to any Loan Document;

 

(b)           Liens for Taxes if obligations with respect to such Taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted so long as adequate reserves or other appropriate provisions as shall be required in conformity with GAAP shall have been made therefor;

 

(c)           statutory Liens of landlords, banks (and rights of set-off), of carriers, warehousemen, mechanics, repairmen, workmen and materialmen, and other Liens imposed by law (other than any such Lien imposed pursuant to Section 430(k) of the Internal Revenue Code or Section 303(k) of ERISA or a violation of Section 436 of the Internal Revenue Code), in each case incurred in the ordinary course of business (i) for amounts not yet overdue or (ii) for amounts that are overdue and that (in the case of any such amounts overdue for a period in excess of five (5) days) are being contested in good faith by appropriate proceedings, so long as such reserves or other appropriate provisions, if any, as shall be required by GAAP shall have been made for any such contested amounts;

  

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(d)           Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, trade contracts, performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money), so long as no foreclosure, sale or similar proceedings have been commenced with respect to any portion of the Collateral on account thereof;

 

(e)           easements, rights-of-way, restrictions, encroachments, and other minor defects or irregularities in title, in each case which do not and will not interfere in any material respect with the ordinary conduct of the business of Holdings or any of its Subsidiaries and that, in the aggregate, do not materially detract from the value of the property subject thereto;

 

(f)           any interest or title of a lessor or sublessor under any lease of real estate permitted hereunder and covering only the assets so leased;

 

(g)           Liens solely on any cash earnest money deposits made by Holdings or any of its Subsidiaries in connection with any letter of intent or purchase agreement permitted hereunder;

 

(h)           purported Liens evidenced by the filing of precautionary UCC financing statements relating solely to operating leases of personal property entered into in the ordinary course of business;

 

(i)            Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

 

(j)           any zoning or similar law or right reserved to or vested in any governmental office or agency to control or regulate the use of any real property;

 

(k)           non-exclusive outbound licenses of patents, copyrights, trademarks and other intellectual property rights granted by Holdings or any of its Subsidiaries in the ordinary course of business and not interfering in any respect with the ordinary conduct of or materially detracting from the value of the business of the Borrower or such Subsidiary;

 

(l)             Liens described in Schedule 6.02; 

 

(m)           Liens securing Indebtedness permitted pursuant to Section 6.01(j); provided, that any such Lien shall encumber only the asset acquired with the proceeds of such Indebtedness;

 

(n)           Liens securing Indebtedness permitted by Section 6.01(k), provided, that any such Lien shall encumber only those assets which secured such Indebtedness at the time such assets were acquired by the Borrower or its Subsidiaries; and

  

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(o)          other Liens on assets other than the Collateral securing Indebtedness in an aggregate amount not to exceed $10,000,000 at any time outstanding.

 

Section 6.03        No Further Negative Pledges.  Except with respect to (a) this Agreement and the other Loan Documents, (b) specific assets or property encumbered to secure payment of particular Indebtedness or to be sold pursuant to an executed agreement with respect to a permitted Asset Sale and (c) restrictions by reason of customary provisions restricting assignments, subletting or other transfers contained in leases, licenses and similar agreements entered into in the ordinary course of business (provided that such restrictions are limited to the assets or property secured by such Liens or the assets or property subject to such leases, licenses or similar agreements, as the case may be), enter into any agreement prohibiting the creation or assumption of any Lien upon any of its properties or assets, whether now owned or hereafter acquired, to secure the Obligations.

 

Section 6.04        Restricted Junior Payments.  Directly or indirectly through any manner or means nor shall it permit any of its Affiliates directly or indirectly through any manner or means, declare, order, pay, make or set apart, or agree to declare, order, pay, make or set apart, any sum for any Restricted Junior Payment except that (a) any Subsidiary of the Borrower may declare and pay dividends or make other distributions ratably to the Borrower or any Wholly-Owned Subsidiary Guarantor; (b) the Borrower (i) may refinance the Senior Notes in accordance with Indebtedness incurred under Section 6.01(c), (ii) may make regularly scheduled payments of interest in respect of the Senior Notes and any Indebtedness permitted by Section 6.01(c) in accordance with the terms of, and only to the extent required by, the indenture governing such notes, and (iii)  if the Leverage Ratio is less than or equal to 3.65:1.00, the Borrower may repurchase, repay, redeem, defease or retire Senior Notes or any outstanding Indebtedness permitted under Section 6.01(c) with the then Available Amount; (c) so long as no Default or Event of Default shall have occurred and be continuing or shall be caused thereby, the Borrower may make Restricted Junior Payments to Holdings (i) in an aggregate amount not to exceed $2,000,000 in any Fiscal Year, to the extent necessary to permit Holdings to pay general administrative costs and expenses incurred in the ordinary course of business, (ii) for so long as Holdings and its Subsidiaries are members of the same affiliated group of corporations within the meaning of Section 1504 of the Internal Revenue Code and the Treasury Regulations promulgated thereunder (and any similar provision of state or local income tax law) to the extent necessary to permit Holdings to discharge the consolidated tax liabilities of Holdings and its Subsidiaries as part of such an affiliated group of which Holdings is the common parent within the meaning of Section 1504 of the Internal Revenue Code, provided that such Restricted Junior Payment shall not exceed the aggregate amount that would be payable by the Borrower and its Subsidiaries if they filed Tax returns on a stand-alone basis, in each case so long as Holdings applies the amount of any such Restricted Junior Payment for such purpose, (iii) in an aggregate amount not to exceed $1,000,000 in any twelve-month period, provided that any unused amount may be carried forward to up to a maximum aggregate amount of $2,500,000 in any twelve-month period to permit Holdings to purchase common stock or common stock options of Holdings from present or former officers or employees of Holdings or any of its Subsidiaries upon the death, disability or termination of employment of such officer or employee, and (iv) in an aggregate amount not to exceed $15,000,000, which Holdings may distribute to its shareholders or which the Borrower may use to make other Restricted Junior Payments.

  

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Section 6.05         Restrictions on Subsidiary Distributions.  Except as provided herein, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Subsidiary of the Borrower to (a) pay dividends or make any other distributions on any of such Subsidiary’s Equity Interests owned by the Borrower or any other Subsidiary of the Borrower, (b) repay or prepay any Indebtedness owed by such Subsidiary to the Borrower or any Subsidiary Guarantor, (c) make loans or advances to the Borrower or any other Subsidiary Guarantor, or (d) transfer, lease or license any of its property or assets to the Borrower or any other Subsidiary Guarantor other than restrictions (i) in agreements evidencing Indebtedness permitted by Section 6.01(j) or (k) that impose restrictions on the property so acquired, (ii) by reason of customary provisions restricting assignments, subletting or other transfers contained in leases, licenses, joint venture agreements and similar agreements entered into in the ordinary course of business or (iii) that are or were created by virtue of any transfer of, agreement to transfer or option or right with respect to any property, assets or Equity Interests not otherwise prohibited under this Agreement.

 

Section 6.06         Investments.  Directly or indirectly, make or own any Investment in any Person, including any Joint Venture, except:

 

(a)           Investments in Cash and Cash Equivalents;

 

(b)           equity Investments owned as of the Closing Date in any Subsidiary and any Joint Venture and Investments made after the Closing Date in the Borrower and any Wholly-Owned Subsidiary Guarantor;

 

(c)           Investments (i) in any Securities received in satisfaction or partial satisfaction thereof from financially troubled account debtors and (ii) deposits, prepayments and other credits to suppliers made in the ordinary course of business consistent with the past practices of the Loan Parties and their Subsidiaries;

 

(d)           intercompany loans to the extent permitted under Section 6.01(b) and other Investments in Joint Ventures and Subsidiaries which are not Wholly-Owned Subsidiary Guarantors, provided that such Investments (including through intercompany loans and any Permitted Acquisition) in Joint Ventures and Subsidiaries other than Wholly-Owned Subsidiary Guarantors shall not exceed at any time an aggregate amount $25,000,000.

 

(e)           Investments consisting of Consolidated Capital Expenditures with respect to the Borrower and the Guarantors permitted by Section 6.07(c);

 

(f)           loans and advances to employees of Holdings and its Subsidiaries made in the ordinary course of business in an aggregate principal amount not to exceed $1,000,000;

 

(g)          Permitted Acquisitions and the Related Acquisitions permitted pursuant to Section 6.08;

 

(h)          Investments described in Schedule 6.06; 

 

(i)           Investments consisting of Hedge Agreements; and

  

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(j)           other Investments in an aggregate amount not to exceed $10,000,000 plus, if the Leverage Ratio is less than or equal to 3.65:1.00, the then Available Amount during the term of this Agreement.

 

Notwithstanding the foregoing, in no event shall any Loan Party make any Investment which results in or facilitates in any manner any Restricted Junior Payment not otherwise permitted under the terms of Section 6.04.

 

Section 6.07         Financial Covenants.  In the case of Holdings:

 

(a)           Interest Coverage Ratio.  Permit the Interest Coverage Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending June 30, 2010, to be less than the correlative ratio indicated:

 

	
Fiscal Quarter End Date

	  	
Interest Coverage Ratio

	
June 30, 2010

	  	
2.00:1.00

	
September 30, 2010

	  	
2.00:1.00

	
December 31, 2010

	  	
2.00:1.00

	
March 31, 2011

	  	
2.00:1.00

	
June 30, 2011

	  	
2.00:1.00

	
September 30, 2011

	  	
2.00:1.00

	
December 31, 2011

	  	
2.05:1.00

	
March 31, 2012

	  	
2.10:1.00

	
June 30, 2012

	  	
2.15:1.00

	
September 30, 2012

	  	
2.15:1.00

	
December 31, 2012

	  	
2.25:1.00

	
March 31, 2013

	  	
2.30:1.00

	
June 30, 2013

	  	
2.40:1.00

	
September 30, 2013

	  	
2.50:1.00

	
December 31, 2013

	  	
2.50:1.00

	
March 31, 2014 and thereafter

	
  

	
2.60:1.00

(b)           Leverage Ratio.  Permit the Leverage Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending June 30, 2010, to exceed the correlative ratio indicated:

 

	
Fiscal Quarter End Date

	  	
Leverage Ratio

	
June 30, 2010

	  	
5.50:1.00

	
September 30, 2010

	  	
5.50:1.00

	
December 31, 2010

	  	
5.25:1.00

  

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Fiscal Quarter End Date

	  	
Leverage Ratio

	
March 31, 2011

	  	
5.15:1.00

	
June 30, 2011

	  	
5.00:1.00

	
September 30, 2011

	  	
4.90:1.00

	
December 31, 2011

	  	
4.90:1.00

	
March 31, 2012

	  	
4.75:1.00

	
June 30, 2012

	  	
4.60:1.00

	
September 30, 2012

	  	
4.50:1.00

	
December 31, 2012

	  	
4.50:1.00

	
March 31, 2013

	  	
4.35:1.00

	
June 30, 2013

	  	
4.25:1.00

	
September 30, 2013

	  	
4.15:1.00

	
December 31, 2013

	  	
4.00:1.00

	
March 31, 2014

	  	
4.00:1.00

	
June 30, 2014

	  	
3.90:1.00

	
September 30, 2014

	  	
3.80:1.00

	
December 31, 2014

	  	
3.75:1.00

	
March 31, 2015

	  	
3.75:1.00

	
June 30, 2015 and thereafter

	
  

	
3.65:1.00

 

(c)           Maximum Consolidated Capital Expenditures.  Make or incur Consolidated Capital Expenditures, in any Fiscal Year indicated below, in an aggregate amount for the Loan Parties and their Subsidiaries in excess of the corresponding amount set forth below opposite such Fiscal Year (the “Permitted Capital Expenditure Amount”); provided, that such amount for any Fiscal Year shall be increased by an amount equal to the excess, if any, (of such amount for the immediately preceding Fiscal Year (as adjusted in accordance with this proviso) over the actual amount of Consolidated Capital Expenditures for such previous Fiscal Year (the “Rollover Amount”) (provided, that any such excess amount shall be used in the immediately following Fiscal Year after the amount scheduled for such following Fiscal Year); provided further that if the total net revenues (as reflected on a consolidated statement of operations) for a Fiscal Year exceed $600,000,000, the Permitted Capital Expenditure Amount for such Fiscal Year set forth below shall be increased by 5% of the amount in excess of $600,000,000:

 

	
Fiscal

Year

	 	
Consolidated Capital

Expenditures

	 
	
2010

	 	$	42,500,000	 
	
2011

	 	$	42,500,000	 
	
2012

	 	$	42,500,000	 

  

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Fiscal

Year

	 	
Consolidated Capital

Expenditures

	 
	
2013

	 	$	42,500,000	 
	
2014

	 	$	42,500,000	 
	
2015

	 	$	42,500,000	 
	
2016

	 	$	42,500,000	 

Section 6.08         Fundamental Changes; Disposition of Assets; Acquisitions.  Enter into any transaction of merger or consolidation, or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution), or convey, sell, lease or license, exchange, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any part of its business, assets or property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, whether now owned or hereafter acquired, leased or licensed, or acquire by purchase or otherwise (other than purchases or other acquisitions of inventory, materials and equipment and Consolidated Capital Expenditures in the ordinary course of business) the business, property or fixed assets of, or stock or other evidence of beneficial ownership of, any Person or any division or line of business or other business unit of any Person, except:

 

(a)           any Subsidiary of the Borrower may be merged with or into the Borrower or any Wholly-Owned Subsidiary Guarantor, or be liquidated, wound up or dissolved, or all or any part of its business, assets or property may be conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or a series of transactions, to the Borrower or any Wholly-Owned Subsidiary Guarantor; provided, that in the case of such a merger, the Borrower or such Wholly-Owned Subsidiary Guarantor, as applicable shall be the continuing or surviving Person;

 

(b)           any Subsidiary of the Borrower may dispose of any or all of its assets (upon voluntary liquidation or otherwise) to the Borrower or any Wholly-Owned Subsidiary Guarantor;

 

(c)           sales or other dispositions of assets that do not constitute Asset Sales;

 

(d)           Asset Sales, the proceeds of which (valued at the principal amount thereof in the case of non-Cash proceeds consisting of notes or other debt Securities and valued at fair market value in the case of other non-Cash proceeds) are less than $10,000,000; provided, that (1) the consideration received for such assets shall be in an amount at least equal to the fair market value thereof (determined in good faith by the board of directors  of the Borrower (or similar governing body)), (2) no less than 75% thereof shall be paid in Cash, and (3) the Net Cash Proceeds thereof shall be applied as required by Section 2.14(a);

 

(e)           disposals of obsolete, worn out or surplus property;

 

(f)            Permitted Acquisitions; provided, that in respect of acquisition targets not domiciled within the United States, the Acquisition Consideration for such Persons or assets shall not exceed, collectively with any Investment permitted under Section 6.06(d) in Joint Ventures and Subsidiaries other than Wholly-Owned Subsidiary Guarantors, more than $25,000,000; 

 

  

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(g)          Investments made in accordance with Section 6.06; and

 

(h)          the Related Acquisitions.

 

Section 6.09         Disposal of Subsidiary Interests.  Except for any sale of all of its interests in the Equity Interests of any of its Subsidiaries in compliance with the provisions of Section 6.08, directly or indirectly sell, assign, pledge or otherwise encumber or dispose of any Equity Interests of any of its Subsidiaries, except to qualify directors if required by applicable law.

 

Section 6.10         Sales and Lease-Backs.  Directly or indirectly, become or remain liable as lessee or as a guarantor or other surety with respect to any lease of any property (whether real, personal or mixed), whether now owned or hereafter acquired, which such Loan Party (a) has sold or transferred or is to sell or to transfer to any other Person (other than Holdings or any of its Subsidiaries), (b) intends to use for substantially the same purpose as any other property which has been or is to be sold or transferred by such Loan Party to any Person (other than Holdings or any of its Subsidiaries) in connection with such lease or (c) is to be sold or transferred by such Loan Party to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Loan Party excluding any sale and leaseback of (a) the real property owned by New Jersey Imaging Partners, Inc. and located at 2770 Morris Avenue, Union N.J., (b) real property acquired as part of a Permitted Acquisition which has a fair market value of less than $2,500,000 and (c) any sale and leaseback of equipment with respect to which the capital lease with respect to such equipment is otherwise permitted to be incurred pursuant to Section 6.01(j) .

 

Section 6.11         Transactions with Shareholders and Affiliates.  Directly or indirectly, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property, the rendering of any service or the payment of any management, advisory or similar fees) with any Affiliate of Holdings on terms that are less favorable to Holdings or that Subsidiary, as the case may be, than those that might be obtained in a comparable arm’s length transaction at the time from a Person who is not such a holder or Affiliate; provided, that the foregoing restriction shall not apply to (a) any transaction between the Borrower and any Wholly-Owned Subsidiary Guarantor or Beverly; (b) reasonable and customary fees paid to members of the board of directors (or similar governing body) of Holdings and its Subsidiaries; and (c) compensation arrangements for officers and other employees of Holdings and its Subsidiaries entered into in the ordinary course of business.

 

Section 6.12         Conduct of Business.  From and after the Closing Date, engage in any business (either directly or through a Subsidiary) other than the businesses engaged in by such Loan Party on the Closing Date and any business that is similar, reasonably related, incidental or ancillary thereto or a business that is acquired pursuant to a Permitted Acquisition.

  

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Section 6.13        Permitted Activities of Holdings.  In the case of Holdings, (a) incur, directly or indirectly, any Indebtedness or any other obligation or liability whatsoever other than the Indebtedness and obligations under this Agreement, the other Loan Documents and the Senior Notes Documents; (b) create or suffer to exist any Lien upon any assets or property now owned or hereafter acquired, leased or licensed by it other than the Liens created under the Security Documents to which it is a party or permitted pursuant to Section 6.2; (c) engage in any business or activity or own any assets other than (i) holding 100.0% of the Equity Interests of the Borrower, (ii) performing its obligations and activities incidental thereto under the Loan Documents, and to the extent not inconsistent therewith, the Senior Notes Documents; and (iii) making Restricted Junior Payments and Investments to the extent permitted by this Agreement; (d) consolidate with or merge with or into, or convey, transfer, lease or license all or substantially all its assets to, any Person; (e) sell or otherwise dispose of any Equity Interests of any of its Subsidiaries unless, in the case of any Subsidiary other than the Borrower, such disposition is permitted under Section 6.08(d) (it being understood that there is no restriction in this covenant on dispositions of Equity Interests in Joint Ventures); (f) create or acquire any Subsidiary or make or own any Investment in any Person other than the Borrower; or (g) fail to hold itself out to the public as a legal entity separate and distinct from all other Persons.

 

Section 6.14         Amendments or Waivers of Organizational Documents, Material Contracts and Certain Indebtedness.  Agree to (a) any material amendment, restatement, supplement or other modification to any of its Organizational Documents, or any of its material rights under any Material Contract (including the BRMG Management Agreement) if the effect of such amendment, restatement, supplement or other modification would be materially adverse to the Loan Parties (taken as a whole) or the Lenders or (b) any amendment, restatement, supplement, waiver or other modification changing the terms of any Senior Notes or any other Indebtedness incurred pursuant to Section 6.01(c), or make any payment consistent with an amendment, restatement, supplement, waiver or other modification thereto, if the effect of such amendment, restatement, supplement, waiver or other modification is to increase the interest rate on the Senior Notes or any other Indebtedness incurred pursuant to Section 6.01(c), change (to earlier dates) any dates upon which payments of principal or interest are due thereon, change any event of default or condition to an event of default with respect thereto (other than to eliminate any such event of default or increase any grace period related thereto), change the redemption, prepayment or defeasance provisions thereof, or if the effect of such amendment, restatement, supplement, waiver or other modification, together with all other amendments, restatements, supplements, waivers and other modifications made, is to increase materially the obligations of the obligor thereunder or to confer any additional rights on the holders of such Senior Notes or such other Indebtedness incurred pursuant to Section 6.01(c) (or a trustee or other representative on their behalf) which would be adverse to any Loan Party or Lenders.

 

Section 6.15         Fiscal Year.  Change its Fiscal Year-end from December 31st or change its method of determining Fiscal Quarters.

 

Section 6.16         Post-Closing Undertakings.  Within the time period specified on Schedule 6.16 (or such later date to which the Administrative Agent consents), comply with the provisions set forth in Schedule 6.16.

  

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ARTICLE VII.

GUARANTY

 

Section 7.01        Guaranty of the Obligations.  Subject to the provisions of Section 7.02, Guarantors jointly and severally hereby irrevocably and unconditionally guaranty to the Administrative Agent for the ratable benefit of the Beneficiaries the due and punctual payment in full of all Obligations when the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)) (collectively, the “Guaranteed Obligations”).

 

Section 7.02         Contribution by Guarantors.  All Guarantors desire to allocate among themselves (collectively, the “Contributing Guarantors”), in a fair and equitable manner, their obligations arising under this Guaranty.  Accordingly, in the event any payment or distribution is made on any date by a Guarantor (a “Funding Guarantor”) under this Guaranty such that its Aggregate Payments exceeds its Fair Share as of such date, such Funding Guarantor shall be entitled to a contribution from each of the other Contributing Guarantors in an amount sufficient to cause each Contributing Guarantor’s Aggregate Payments to equal its Fair Share as of such date.  “Fair Share” means, with respect to a Contributing Guarantor as of any date of determination, an amount equal to (a) the ratio of (i) the Fair Share Contribution Amount with respect to such Contributing Guarantor to (ii) the aggregate of the Fair Share Contribution Amounts with respect to all Contributing Guarantors multiplied by (b) the aggregate amount paid or distributed on or before such date by all Funding Guarantors under this Guaranty in respect of the obligations Guaranteed.  “Fair Share Contribution Amount” means, with respect to a Contributing Guarantor as of any date of determination, the maximum aggregate amount of the obligations of such Contributing Guarantor under this Guaranty that would not render its obligations hereunder or thereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any comparable applicable provisions of state law; provided, that solely for purposes of calculating the “Fair Share Contribution Amount” with respect to any Contributing Guarantor for purposes of this Section 7.02, any assets or liabilities of such Contributing Guarantor arising by virtue of any rights to subrogation, reimbursement or indemnification or any rights to or obligations of contribution hereunder shall not be considered as assets or liabilities of such Contributing Guarantor.  “Aggregate Payments” means, with respect to a Contributing Guarantor as of any date of determination, an amount equal to (1) the aggregate amount of all payments and distributions made on or before such date by such Contributing Guarantor in respect of this Guaranty (including in respect of this Section 7.02), minus (2) the aggregate amount of all payments received on or before such date by such Contributing Guarantor from the other Contributing Guarantors as contributions under this Section 7.02.  The amounts payable as contributions hereunder shall be determined as of the date on which the related payment or distribution is made by the applicable Funding Guarantor.  The allocation among Contributing Guarantors of their obligations as set forth in this Section 7.02 shall not be construed in any way to limit the liability of any Contributing Guarantor hereunder.  Each Guarantor is a third party beneficiary to the contribution agreement set forth in this Section 7.02.

  

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Section 7.03         Payment by Guarantors.  Subject to Section 7.02, Guarantors hereby jointly and severally agree, in furtherance of the foregoing and not in limitation of any other right which any Beneficiary may have at law or in equity against any Guarantor by virtue hereof, that upon the failure of the Borrower to pay any of the Guaranteed Obligations when and as the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C.  § 362(a)), Guarantors shall upon demand pay, or cause to be paid, in Cash, to the Administrative Agent for the ratable benefit of Beneficiaries, an amount equal to the sum of the unpaid principal amount of all Guaranteed Obligations then due as aforesaid, accrued and unpaid interest on such Guaranteed Obligations (including interest which, but for the Borrower’s becoming the subject of a case under the Bankruptcy Code, would have accrued on such Guaranteed Obligations, whether or not a claim is allowed against the Borrower for such interest in the related bankruptcy case) and all other Guaranteed Obligations then owed to Beneficiaries as aforesaid.

 

Section 7.04         Liability of Guarantors Absolute.  Each Guarantor agrees that its obligations hereunder are irrevocable, absolute, independent and unconditional and shall not be affected by any circumstance which constitutes a legal or equitable discharge of a guarantor or surety other than payment in full of the Guaranteed Obligations.  In furtherance of the foregoing and without limiting the generality thereof, each Guarantor agrees as follows:

 

(a)           this Guaranty is a guaranty of payment when due and not of collectability.  This Guaranty is a primary obligation of each Guarantor and not merely a contract of surety;

 

(b)           the Administrative Agent may enforce this Guaranty upon the occurrence of an Event of Default notwithstanding the existence of any dispute between the Borrower and any Beneficiary with respect to the existence of such Event of Default;

 

(c)           the obligations of each Guarantor hereunder are independent of the obligations of the Borrower and the obligations of any other guarantor (including any other Guarantor) of the obligations of the Borrower, and a separate action or actions may be brought and prosecuted against such Guarantor whether or not any action is brought against the Borrower or any of such other guarantors and whether or not the Borrower is joined in any such action or actions;

 

(d)           payment by any Guarantor of a portion, but not all, of the Guaranteed Obligations shall in no way limit, affect, modify or abridge any Guarantor’s liability for any portion of the Guaranteed Obligations which has not been paid.  Without limiting the generality of the foregoing, if the Administrative Agent is awarded a judgment in any suit brought to enforce any Guarantor’s covenant to pay a portion of the Guaranteed Obligations, such judgment shall not be deemed to release such Guarantor from its covenant to pay the portion of the Guaranteed Obligations that is not the subject of such suit, and such judgment shall not, except to the extent satisfied by such Guarantor, limit, affect, modify or abridge any other Guarantor’s liability hereunder in respect of the Guaranteed Obligations;

  

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(e)           any Beneficiary, upon such terms as it deems appropriate, without notice or demand and without affecting the validity or enforceability hereof or giving rise to any reduction, limitation, impairment, discharge or termination of any Guarantor’s liability hereunder, from time to time may (i) renew, extend, accelerate, increase the rate of interest on, or otherwise change the time, place, manner or terms of payment of the Guaranteed Obligations; (ii) settle, compromise, release or discharge, or accept or refuse any offer of performance with respect to, or substitutions for, the Guaranteed Obligations or any agreement relating thereto and/or subordinate the payment of the same to the payment of any other obligations; (iii) request and accept other guaranties of the Guaranteed Obligations and take and hold security for the payment hereof or the Guaranteed Obligations; (iv) release, surrender, exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or modify, with or without consideration, any security for payment of the Guaranteed Obligations, any other guaranties of the Guaranteed Obligations, or any other obligation of any Person (including any other Guarantor) with respect to the Guaranteed Obligations; (v) enforce and apply any security now or hereafter held by or for the benefit of such Beneficiary in respect hereof or the Guaranteed Obligations and direct the order or manner of sale thereof, or exercise any other right or remedy that such Beneficiary may have against any such security, in each case as such Beneficiary in its discretion may determine consistent herewith or the applicable Hedge Agreement and any applicable security agreement, including foreclosure on any such security pursuant to one or more judicial or nonjudicial sales, whether or not every aspect of any such sale is commercially reasonable, and even though such action operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of any Guarantor against the Borrower or any security for the Guaranteed Obligations; and (vi) exercise any other rights available to it under the Loan Documents or any Hedge Agreements; and

 

(f)           this Guaranty and the obligations of Guarantors hereunder shall be valid and enforceable and shall not be subject to any reduction, limitation, impairment, discharge or termination for any reason (other than payment in full of the Guaranteed Obligations), including the occurrence of any of the following, whether or not any Guarantor shall have had notice or knowledge of any of them: (i) any failure or omission to assert or enforce or agreement or election not to assert or enforce, or the stay or enjoining, by order of court, by operation of law or otherwise, of the exercise or enforcement of, any claim or demand or any right, power or remedy (whether arising under the Loan Documents or any Hedge Agreements, at law, in equity or otherwise) with respect to the Guaranteed Obligations or any agreement relating thereto, or with respect to any other guaranty of or security for the payment of the Guaranteed Obligations; (ii) any rescission, waiver, amendment or modification of, or any consent to departure from, any of the terms or provisions (including provisions relating to events of default) hereof, any of the other Loan Documents, any of the Hedge Agreements or any agreement or instrument executed pursuant thereto, or of any other guaranty or security for the Guaranteed Obligations, in each case whether or not in accordance with the terms hereof or such Loan Document, such Hedge Agreement or any agreement relating to such other guaranty or security; (iii) the Guaranteed Obligations, or any agreement relating thereto, at any time being found to be illegal, invalid or unenforceable in any respect; (iv) the application of payments received from any source (other than payments received pursuant to the other Loan Documents or any of the Hedge Agreements or from the proceeds of any security for the Guaranteed Obligations, except to the extent such security also serves as collateral for indebtedness other than the Guaranteed Obligations) to the payment of indebtedness other than the Guaranteed Obligations, even though any Beneficiary might have elected to apply such payment to any part or all of the Guaranteed Obligations; (v) any Beneficiary’s consent to the change, reorganization or termination of the corporate structure or existence of Holdings or any of its Subsidiaries and to any corresponding restructuring of the Guaranteed Obligations; (vi) any failure to perfect or continue perfection of a security interest in any collateral which secures any of the Guaranteed Obligations; (vii) any defenses, set-offs or counterclaims which the Borrower may allege or assert against any Beneficiary in respect of the Guaranteed Obligations, including failure of consideration, breach of warranty, payment, statute of frauds, statute of limitations, accord and satisfaction and usury; and (viii) any other act or thing or omission, or delay to do any other act or thing, which may or might in any manner or to any extent vary the risk of any Guarantor as an obligor in respect of the Guaranteed Obligations.

  

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Section 7.05         Waivers by Guarantors.  Each Guarantor hereby waives, for the benefit of Beneficiaries: (a) any right to require any Beneficiary, as a condition of payment or performance by such Guarantor, to (i) proceed against the Borrower, any other guarantor (including any other Guarantor) of the Guaranteed Obligations or any other Person, (ii) proceed against or exhaust any security held from the Borrower, any such other guarantor or any other Person, (iii) proceed against or have resort to any balance of any Deposit Account or credit on the books of any Beneficiary in favor of the Borrower or any other Person, or (iv) pursue any other remedy in the power of any Beneficiary whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of the Borrower or any other Guarantor including any defense based on or arising out of the lack of validity or the unenforceability of the Guaranteed Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of the Borrower or any other Guarantor from any cause other than payment in full of the Guaranteed Obligations; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Beneficiary’s errors or omissions in the administration of the Guaranteed Obligations, except behavior which amounts to bad faith; (e) (i) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms hereof and any legal or equitable discharge of such Guarantor’s obligations hereunder, (ii) the benefit of any statute of limitations affecting such Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights to set-offs, recoupments and counterclaims, and (iv) promptness, diligence and any requirement that any Beneficiary protect, secure, perfect or insure any security interest or lien or any property subject thereto; (f) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance hereof, notices of default hereunder, the Hedge Agreements or any agreement or instrument related thereto, notices of any renewal, extension or modification of the Guaranteed Obligations or any agreement related thereto, notices of any extension of credit to the Borrower and notices of any of the matters referred to in Section 7.04 and any right to consent to any thereof; and (g) any defenses or benefits that may be derived from or afforded by law which limit the liability of or exonerate guarantors or sureties, or which may conflict with the terms hereof.

  

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Section 7.06         Guarantors’ Rights of Subrogation, Contribution, Etc.  Until the Guaranteed Obligations shall have been indefeasibly paid in full and the Revolving Commitments shall have terminated and all Letters of Credit shall have expired or been cancelled (or collateralized in a manner acceptable to the Issuing Bank), each Guarantor hereby waives any claim, right or remedy, direct or indirect, that such Guarantor now has or may hereafter have against the Borrower or any other Guarantor or any of its assets in connection with this Guaranty or the performance by such Guarantor of its obligations hereunder (other than rights of contribution such Guarantor may have against any other guarantor of the Guaranteed Obligations as contemplated by Section 7.02), in each case whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise and including (a) any right of subrogation, reimbursement or indemnification that such Guarantor now has or may hereafter have against the Borrower with respect to the Guaranteed Obligations, (b) any right to enforce, or to participate in, any claim, right or remedy that any Beneficiary now has or may hereafter have against the Borrower, and (c) any benefit of, and any right to participate in, any collateral or security now or hereafter held by any Beneficiary.  In addition, until the Guaranteed Obligations shall have been indefeasibly paid in full and the Revolving Commitments shall have terminated and all Letters of Credit shall have expired or been cancelled (or collateralized in a manner acceptable to the Issuing Bank), each Guarantor shall withhold exercise of any right of contribution such Guarantor may have against any other guarantor (including any other Guarantor) of the Guaranteed Obligations, including any such right of contribution as contemplated by Section 7.02.  Each Guarantor further agrees that, to the extent the waiver or agreement to withhold the exercise of its rights of subrogation, reimbursement, indemnification and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation, reimbursement or indemnification such Guarantor may have against the Borrower or against any collateral or security, and any rights of contribution such Guarantor may have against any such other guarantor, shall be junior and subordinate to any rights any Beneficiary may have against the Borrower, to all right, title and interest any Beneficiary may have in any such collateral or security, and to any right any Beneficiary may have against such other guarantor.  If any amount shall be paid to any Guarantor on account of any such subrogation, reimbursement, indemnification or contribution rights at any time when all Guaranteed Obligations shall not have been finally and indefeasibly paid in full, such amount shall be held in trust for the Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over to the Administrative Agent for the benefit of Beneficiaries to be credited and applied against the Guaranteed Obligations, whether matured or unmatured, in accordance with the terms hereof.

 

Section 7.07        Subordination of Other Obligations.  Any Indebtedness of the Borrower or any Guarantor now or hereafter held by any Guarantor (the “Obligee Guarantor”) is hereby subordinated in right of payment to the Guaranteed Obligations, and any such Indebtedness collected or received by the Obligee Guarantor after an Event of Default has occurred and is continuing shall be held in trust for the Administrative Agent on behalf of Beneficiaries and shall forthwith be paid over to the Administrative Agent for the benefit of Beneficiaries to be credited and applied against the Guaranteed Obligations but without affecting, impairing or limiting in any manner the liability of the Obligee Guarantor under any other provision hereof.

 

Section 7.08         Continuing Guaranty.  This Guaranty is a continuing guaranty and shall remain in effect until all of the Guaranteed Obligations shall have been paid in full and the Revolving Commitments shall have terminated and all Letters of Credit shall have expired or been cancelled (or collateralized in a manner acceptable to the Issuing Bank).  Each Guarantor hereby irrevocably waives any right to revoke this Guaranty as to future transactions giving rise to any Guaranteed Obligations.

 

Section 7.09         Authority of Guarantors or the Borrower.  It is not necessary for any Beneficiary to inquire into the capacity or powers of any Guarantor or the Borrower or the officers, directors or any agents acting or purporting to act on behalf of any of them.

  

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Section 7.10        Financial Condition of the Borrower.  Any Credit Extension may be made to the Borrower or continued from time to time, and any Hedge Agreements may be entered into from time to time, in each case without notice to or authorization from any Guarantor regardless of the financial or other condition of the Borrower at the time of any such grant or continuation or at the time such Hedge Agreement is entered into, as the case may be.  No Beneficiary shall have any obligation to disclose or discuss with any Guarantor its assessment, or any Guarantor’s assessment, of the financial condition of the Borrower.  Each Guarantor has adequate means to obtain information from the Borrower on a continuing basis concerning the financial condition of the Borrower and its ability to perform its obligations under the Loan Documents and the Hedge Agreements, and each Guarantor assumes the responsibility for being and keeping informed of the financial condition of the Borrower and of all circumstances bearing upon the risk of nonpayment of the Guaranteed Obligations.  Each Guarantor hereby waives and relinquishes any duty on the part of any Beneficiary to disclose any matter, fact or thing relating to the business, operations or conditions of the Borrower now known or hereafter known by any Beneficiary.

 

Section 7.11         Bankruptcy, Etc.

 

(a)           So long as any Guaranteed Obligations remain outstanding, no Guarantor shall, without the prior written consent of the Administrative Agent acting pursuant to the instructions of Required Lenders, commence or join with any other Person in commencing any bankruptcy, reorganization or insolvency case or proceeding of or against the Borrower or any other Guarantor.  The obligations of Guarantors hereunder shall not be reduced, limited, impaired, discharged, deferred, suspended or terminated by any case or proceeding, voluntary or involuntary, involving the bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of the Borrower or any other Guarantor or by any defense which the Borrower or any other Guarantor may have by reason of the order, decree or decision of any court or administrative body resulting from any such proceeding.

 

(b)           Each Guarantor acknowledges and agrees that any interest on any portion of the Guaranteed Obligations which accrues after the commencement of any case or proceeding referred to in clause (a) above (or, if interest on any portion of the Guaranteed Obligations ceases to accrue by operation of law by reason of the commencement of such case or proceeding, such interest as would have accrued on such portion of the Guaranteed Obligations if such case or proceeding had not been commenced) shall be included in the Guaranteed Obligations because it is the intention of Guarantors and Beneficiaries that the Guaranteed Obligations which are guaranteed by Guarantors pursuant hereto should be determined without regard to any rule of law or order which may relieve the Borrower of any portion of such Guaranteed Obligations.  Guarantors shall permit any trustee in bankruptcy, receiver, debtor in possession, assignee for the benefit of creditors or similar Person to pay the Administrative Agent, or allow the claim of the Administrative Agent in respect of, any such interest accruing after the date on which such case or proceeding is commenced.

 

(c)           In the event that all or any portion of the Guaranteed Obligations are paid by the Borrower, the obligations of Guarantors hereunder shall continue and remain in full force and effect or be reinstated, as the case may be, in the event that all or any part of such payment(s) are rescinded or recovered directly or indirectly from any Beneficiary as a preference, fraudulent transfer or otherwise, and any such payments which are so rescinded or recovered shall constitute Guaranteed Obligations for all purposes hereunder.

  

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Section 7.12         Discharge of Guaranty Upon Sale of Guarantor.  If all of the Equity Interests of any Guarantor or any of its successors in interest hereunder shall be sold or otherwise disposed of (including by merger or consolidation) in accordance with the terms and conditions hereof, the Guaranty of such Guarantor or such successor in interest, as the case may be, hereunder shall automatically be discharged and released without any further action by any Beneficiary or any other Person effective as of the time of such Asset Sale.

 

ARTICLE VIII.

EVENTS OF DEFAULT

 

Section 8.01         Events of Default.  If any one or more of the following conditions or events occur:

 

(a)           Failure to Make Payments When Due.  Failure by the Borrower to pay (i) when due any installment of principal of any Loan, whether at stated maturity, by acceleration, by notice of voluntary prepayment, by mandatory prepayment or otherwise; (ii) when due any amount payable to the Issuing Bank in reimbursement of any drawing under a Letter of Credit; or (iii) any interest on any Loan or any fee or any other amount due hereunder within five (5) days after the date due; or

 

(b)           Default Under Other Agreements.  (i) Failure of any Loan Party to pay when due any principal of or interest on or any other amount, including any payment in settlement, payable in respect of one or more items of Indebtedness (other than Indebtedness referred to in Section 8.01(a)) in an aggregate principal amount (or Net Mark-to-Market Exposure) of $5,000,000 or more, beyond the grace period, if any, provided therefor; or (ii) breach or default by any Loan Party with respect to any other material term of (1) one or more items of Indebtedness in the individual or aggregate principal amounts (or Net Mark-to-Market Exposure) referred to in clause (i) above or (2) any loan agreement, mortgage, indenture or other agreement relating to such item(s) of Indebtedness, in each case beyond the grace period, if any, provided therefor, if the effect of such breach or default is to cause, or to permit the holder or holders of that Indebtedness (or a trustee on behalf of such holder or holders), to cause, that Indebtedness to become or be declared due and payable (or redeemable) prior to its stated maturity or the stated maturity of any underlying obligation, as the case may be; or

 

(c)           Breach of Certain Covenants.  Failure of any Loan Party (i) to perform or comply with any term or condition contained in Section 2.06, Section 5.02 or Article VI, or (ii) to comply with the delivery requirements contained in Sections 5.01(a), 5.01(b), 5.01(c), and 5.01(e) within five (5) Business Days after the date required under such Section; or

 

(d)           Breach of Representations, Etc.  Any representation, warranty, certification or other statement made or deemed made by any Loan Party in any Loan Document or in any statement or certificate at any time given by any Loan Party or any of its Subsidiaries in writing pursuant hereto or thereto or in connection herewith or therewith shall be false in any material respect as of the date made or deemed made or, to the extent that any such representation, warranty, certification or other statement is already qualified by materiality or material adverse effect, such representation, warranty, certification or other statement shall be false in any respect as of the date made or deemed made; or

  

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(e)           Other Defaults Under Loan Documents.  Any Loan Party shall default in the performance of or compliance with any term contained herein or any of the other Loan Documents, other than any such term referred to in any other Section of this Section 8.01, and such default shall not have been remedied or waived within thirty (30) days after the earlier of (i) an officer of such Loan Party becoming aware of such default or (ii) receipt by the Borrower of notice from the Administrative Agent or any Lender of such default; or

 

(f)           Involuntary Bankruptcy; Appointment of Receiver, Etc.  (i) A court of competent jurisdiction shall enter a decree or order for relief in respect of any Loan Party or any of its Significant Subsidiaries in an involuntary case under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect, which decree or order is not stayed; or any other similar relief shall be granted under any applicable federal or state law; or (ii) an involuntary case shall be commenced against any Loan Party or any of its Significant Subsidiaries under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect; or a decree or order of a court having jurisdiction in the premises for the appointment of a receiver, liquidator, sequestrator, trustee, conservator, custodian or other officer having similar powers over any Loan Party or any of its Significant Subsidiaries, or over all or a substantial part of its property, shall have been entered; or there shall have occurred the involuntary appointment of an interim receiver, trustee, conservator or other custodian of any Loan Party or any of its Significant Subsidiaries for all or a substantial part of its property; or a warrant of attachment, execution or similar process shall have been issued against any substantial part of the property of any Loan Party or any of its Significant Subsidiaries, and any such event described in this clause (ii) shall continue for sixty (60) days without having been dismissed, bonded or discharged; or

 

(g)           Voluntary Bankruptcy; Appointment of Receiver, Etc.  (i) Any Loan Party or any of its Significant Subsidiaries shall have an order for relief entered with respect to it or shall commence a voluntary case under the Bankruptcy Code or under any other applicable bankruptcy, insolvency or similar law now or hereafter in effect, or shall consent to the entry of an order for relief in an involuntary case, or to the conversion of an involuntary case to a voluntary case, under any such law, or shall consent to the appointment of or taking possession by a receiver, trustee, conservator or other custodian for all or a substantial part of its property; or any Loan Party or any of its Significant Subsidiaries shall make any assignment for the benefit of creditors; or (ii) any Loan Party or any of its Significant Subsidiaries shall be unable, or shall fail generally, or shall admit in writing its inability, to pay its debts as such debts become due; or the board of directors (or similar governing body) of any Loan Party or any of its Significant Subsidiaries (or any committee thereof) shall adopt any resolution or otherwise authorize any action to approve any of the actions referred to herein or in Section 8.01(f); or

 

(h)           Judgments and Attachments.  Any money judgment, writ or warrant of attachment or similar process involving an amount in excess of $5,000,000 in the aggregate at any time (to the extent not adequately covered by insurance as to which a solvent and unaffiliated insurance company has not denied coverage) shall be entered or filed against any Loan Party or any of its Subsidiaries or any of their respective assets and shall remain undischarged, unvacated, unbonded or unstayed for a period of sixty (60) days (or in any event later than five (5) days prior to the date of any proposed sale thereunder); or

  

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(i)           Dissolution.  Any order, judgment or decree shall be entered against any Loan Party decreeing the dissolution or split up of such Loan Party and such order shall remain undischarged or unstayed for a period in excess of thirty (30) days; or

 

(j)           Employee Benefit Plans.  (i) There shall occur (A) one or more ERISA Events which individually or in the aggregate results in or might reasonably be expected to result in a Material Adverse Effect or (B) the ERISA Event described in clause (ii) of the definition thereof; or (ii) there exists any fact or circumstance that reasonably could be expected to result in the imposition of a Lien or security interest pursuant to Section 430(k) of the Internal Revenue Code or Section 303(k) of ERISA or a violation of Section 436 of the Internal Revenue Code; or

 

(k)          Change of Control.  A Change of Control occurs; or

 

(l)           BRMG Management Agreement.  Either Borrower or Beverly Radiology has breached any material provision, or a material default occurs under, the BRMG Management Agreement or the BRMG Management Agreement ceases to be in full force and effect; or

 

(m)         Guaranties, Security Documents and other Loan Documents.  At any time after the execution and delivery thereof, (i) the Guaranty for any reason, other than the satisfaction in full of all Obligations, shall cease to be in full force and effect (other than in accordance with its terms) or shall be declared to be null and void or any Guarantor shall repudiate its obligations thereunder, (ii) this Agreement or any Security Document ceases to be in full force and effect (other than by reason of a release of Collateral in accordance with the terms hereof or thereof or the satisfaction in full of the Obligations in accordance with the terms hereof) or shall be declared null and void, or the Collateral Agent shall not have or shall cease to have a valid and perfected Lien in any Collateral purported to be covered by the Security Documents with the priority required by the relevant Security Document, in each case for any reason other than the failure of the Collateral Agent or any Secured Party to take any action within its control, or (iii) any Loan Party shall contest the validity or enforceability of any Loan Document in writing or deny in writing that it has any further liability, including with respect to future advances by Lenders, under any Loan Document to which it is a party or shall contest the validity or perfection of any Lien in any Collateral purported to be covered by the Security Documents;

  

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THEN, (1) upon the occurrence of any Event of Default described in Section 8.01(f) or 8.01(g), automatically, and (2) upon the occurrence and during the continuance of any other Event of Default, at the request of (or with the consent of) Required Lenders, upon notice to the Borrower by the Administrative Agent, (A) the Revolving Commitments, if any, of each Lender having such Revolving Commitments, the obligation of the Issuing Bank to issue any Letter of Credit and the obligation of the Swing Line Lender to make any Swing Line Loan shall immediately terminate; (B) each of the following shall immediately become due and payable, in each case without presentment, demand, protest or other requirements of any kind, all of which are hereby expressly waived by each Loan Party: (I) the unpaid principal amount of and accrued interest on the Loans, (II) an amount equal to the maximum amount that may at any time be drawn under all Letters of Credit then outstanding (regardless of whether any beneficiary under any such Letter of Credit shall have presented, or shall be entitled at such time to present, the drafts or other documents or certificates required to draw under such Letters of Credit), and (III) all other Obligations; provided, that the foregoing shall not affect in any way the obligations of Lenders under Section 2.03(b)(v) or Section 2.04(e); (C) the Administrative Agent may cause the Collateral Agent to enforce any and all Liens and security interests created pursuant to the Security Documents; (D) the Administrative Agent shall direct the Borrower to pay (and the Borrower hereby agrees upon receipt of such notice, or upon the occurrence of any Event of Default specified in Sections 8.01(f) and (g) to pay) to the Administrative Agent such additional amounts of cash as reasonably requested by the Issuing Bank, to be held as security for the Borrower’s reimbursement Obligations in respect of Letters of Credit then outstanding; and (E) the Administrative Agent and the Collateral Agent may exercise on behalf of themselves, the Lenders, the Issuing Bank and the other Secured Parties all rights and remedies available to the Administrative Agent, the Collateral Agent, the Lenders and the Issuing Bank under the Loan Documents or under applicable law or in equity.

 

ARTICLE IX.

AGENTS

 

Section 9.01        Appointment of Agents.   Each of DBSI and GECC is hereby appointed as Co-Syndication Agent hereunder, and each Lender hereby authorizes DBSI and GECC to act as the Co-Syndication Agents in accordance with the terms hereof and the other Loan Documents.  Barclays Bank is hereby appointed the Administrative Agent and the Collateral Agent hereunder and under the other Loan Documents and each Lender hereby authorizes Barclays Bank to act as the Administrative Agent and the Collateral Agent in accordance with the terms hereof and the other Loan Documents.  RBC Capital is hereby appointed as Documentation Agent hereunder, and each Lender hereby authorizes RBC Capital to act as Documentation Agent in accordance with the terms hereof and the other Loan Documents.  Each Agent hereby agrees to act in its capacity as such upon the express conditions contained herein and the other Loan Documents, as applicable.  The provisions of this Article IX (other than as expressly provided herein) are solely for the benefit of the Agents and the Lenders and no Loan Party shall have any rights as a third party beneficiary of any of the provisions of this Article IX (other than as expressly provided herein).  In performing its functions and duties hereunder, each Agent shall act solely as an agent of the Lenders and does not assume and shall not be deemed to have assumed any obligation towards or relationship of agency or trust with or for Holdings or any of its Subsidiaries.  Each of the Co-Syndication Agents and the Documentation Agent, without consent of or notice to any party hereto, may assign any and all of its rights or obligations hereunder to any of its Affiliates.  Notwithstanding any other provision of this Agreement or any provision of any other Loan Document, each of the Joint Lead Arrangers, the Co-Syndication Agents and the Documentation Agent are named as such for recognition purposes only, and in their respective capacities as such shall have no duties, responsibilities or liabilities with respect to this Agreement or any other Loan Document; it being understood and agreed that each of the Joint Lead Arrangers, the Co-Syndication Agents and the Documentation Agent shall be entitled to all indemnification and reimbursement rights in favor of the Agents provided herein and in the other Loan Documents and all of the other benefits of this Article IX.  Without limitation of the foregoing, neither the Joint Lead Arrangers, the Co-Syndication Agents nor the Documentation Agent in their respective capacities as such shall, by reason of this Agreement or any other Loan Document, have any fiduciary relationship in respect of any Lender, Loan Party or any other Person.

  

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Section 9.02        Powers and Duties.  Each Lender irrevocably authorizes each Agent to take such action on such Lender’s behalf and to exercise such powers, rights and remedies hereunder and under the other Loan Documents as are specifically delegated or granted to such Agent by the terms hereof and thereof, together with such powers, rights and remedies as are reasonably incidental thereto.  In the event that any obligations (other than the Obligations) are permitted to be incurred hereunder and secured by Liens permitted to be incurred hereunder on all or a portion of the Collateral, each Lender authorizes the Administrative Agent to enter into intercreditor agreements, subordination agreements and amendments to the Security Documents to reflect such arrangements on terms acceptable to the Administrative Agent.  Each Agent shall have only those duties and responsibilities that are expressly specified herein and the other Loan Documents.  Each Agent may exercise such powers, rights and remedies and perform such duties by or through its agents or employees.  No Agent shall have, by reason hereof or any of the other Loan Documents, a fiduciary relationship or other implied duties in respect of any Lender; and nothing herein or any of the other Loan Documents, expressed or implied, is intended to or shall be so construed as to impose upon any Agent any obligations in respect hereof or any of the other Loan Documents except as expressly set forth herein or therein.  Without limiting the generality of the foregoing sentence, the use of the term “agent” in this Agreement and in the other Loan Documents with reference to any Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under the agency doctrine of any applicable law.  Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties.

 

Section 9.03         General Immunity.

 

(a)          No Responsibility for Certain Matters.  No Agent shall be responsible to any Lender for the execution, effectiveness, genuineness, validity, enforceability, collectability or sufficiency hereof or any other Loan Document, or for the creation, perfection or priority of any Lien, or for any representations, warranties, recitals or statements made herein or therein or made in any written or oral statements or in any financial or other statements, instruments, reports or certificates or any other documents furnished or made by any Agent to the Lenders or by or on behalf of any Loan Party or to any Agent or Lender in connection with the Loan Documents and the transactions contemplated thereby or for the financial condition or business affairs of any Loan Party or any other Person liable for the payment of any Obligations, nor shall any Agent be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained in any of the Loan Documents or as to the use of the proceeds of the Loans or as to the existence or possible existence of any Event of Default or Default or as to the value or sufficiency of any Collateral or as to the satisfaction of any condition set forth in Article III or elsewhere herein (other than confirm receipt of items expressly required to be delivered to such Agent) or to inspect the properties, books or records of Holdings or any of its Subsidiaries or to make any disclosures with respect to the foregoing.  Anything contained herein to the contrary notwithstanding, the Administrative Agent shall not have any liability arising from confirmations of the amount of outstanding Loans or the Letter of Credit Usage or the component amounts thereof.

  

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(b)           Exculpatory Provisions.  No Agent nor any of its officers, partners, directors, employees or agents shall be liable to the Lenders (i) for any action taken or omitted by any Agent (A) under or in connection with any of the Loan Documents or (B) with the consent or at the request of the Required Lenders (or, if so specified by this Agreement, all Lenders or any other instructing group of Lenders specified by this Agreement) except to the extent caused by such Agent’s gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction or (ii) for any failure of any Loan Party to perform its obligations under this Agreement or any other Loan Document.  No Agent shall, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose or be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by such Agent or any of its Affiliates in any capacity.  Each Agent shall be entitled to refrain from any act or the taking of any action (including the failure to take an action) in connection herewith or any of the other Loan Documents or from the exercise of any power, discretion or authority vested in it hereunder or thereunder unless and until such Agent shall have received instructions in respect thereof from Required Lenders (or such other Lenders as may be required to give such instructions under Section 10.05) and, upon receipt of such instructions from Required Lenders (or such other Lenders, as the case may be), such Agent shall be entitled to act or (where so instructed) refrain from acting, or to exercise such power, discretion or authority, in accordance with such instructions and shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable law.  Without prejudice to the generality of the foregoing, (i) each Agent shall be entitled to rely, and shall be fully protected in relying, upon any communication, instrument or document believed by it to be genuine and correct and to have been signed or sent by the proper Person or Persons, and shall be entitled to rely and shall be protected in relying on opinions and judgments of attorneys (who may be attorneys for Holdings and its Subsidiaries), accountants, experts and other professional advisors selected by it; and (ii) no Lender shall have any right of action whatsoever against any Agent as a result of such Agent acting or (where so instructed) refraining from acting hereunder or any of the other Loan Documents in accordance with the instructions of Required Lenders (or such other Lenders as may be required to give such instructions under Section 10.05).

 

(c)           Delegation of Duties. Each of the Administrative Agent and the Collateral Agent may perform any and all of its duties and exercise its rights and powers under this Agreement or under any other Loan Document by or through any one or more sub-agents appointed by it. Each of the Administrative Agent, the Collateral Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Affiliates. The exculpatory, indemnification and other provisions of this Section 9.03 and of Section 9.06 shall apply to any of the Affiliates of the Administrative Agent or the Collateral Agent and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as the Administrative Agent or Collateral Agent, as applicable.  All of the rights, benefits, and privileges (including the exculpatory and indemnification provisions) of this Section 9.03 and of Section 9.06 shall apply to any such sub-agent and to the Affiliates of any such sub-agent, and shall apply to their respective activities as sub-agent as if such sub-agent and Affiliates were named herein.  Notwithstanding anything herein to the contrary, with respect to each sub-agent appointed by the Administrative Agent or the Collateral Agent, (i) such sub-agent shall be a third party beneficiary under this Agreement with respect to all such rights, benefits and privileges (including exculpatory rights and rights to indemnification) and shall have all of the rights and benefits of a third party beneficiary, including an independent right of action to enforce such rights, benefits and privileges (including exculpatory rights and rights to indemnification) directly, without the consent or joinder of any other Person, against any or all of Loan Parties and the Lenders, (ii) such rights, benefits and privileges (including exculpatory rights and rights to indemnification) shall not be modified or amended without the consent of such sub-agent, and (iii) such sub-agent shall only have obligations to the Administrative Agent and not to any Loan Party, Lender or any other Person and no Loan Party, Lender or any other Person shall have any rights, directly or indirectly, as a third party beneficiary or otherwise, against such sub-agent.

  

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(d)           Notice of Default or Event of Default.  No Agent shall be deemed to have knowledge of any Default or Event of Default unless and until written notice describing such Default or Event of Default is given to such Agent by a Loan Party or a Lender.  In the event that the Administrative Agent shall receive such a notice, the Administrative Agent shall give notice thereof to the Lenders, provided that failure to give such notice shall not result in any liability on the part of the Administrative Agent.

 

Section 9.04          Agents Entitled to Act as Lender. The agency hereby created shall in no way impair or affect any of the rights and powers of, or impose any duties or obligations upon, any Agent in its individual capacity as a Lender hereunder.  With respect to its participation in the Loans and the Letters of Credit, each Agent shall have the same rights and powers hereunder in its capacity as a Lender as any other Lender and may exercise the same as if it were not performing the duties and functions delegated to it hereunder, and the term “Lender” shall, unless the context clearly otherwise indicates, include each Agent in its individual capacity.  Any Agent and its Affiliates may accept deposits from, lend money to, own securities of, and generally engage in any kind of banking, trust, financial advisory or other business with Holdings or any of its Affiliates as if it were not performing the duties specified herein, and may accept fees and other consideration from the Borrower for services in connection herewith and otherwise without having to account for the same to Lenders.  The Lenders acknowledge that pursuant to such activities, the Agents or their Affiliates may receive information regarding any Loan Party or any Affiliate of any Loan Party (including information that may be subject to confidentiality obligations in favor of such Loan Party or such Affiliate) and acknowledge that the Agents and their Affiliates shall be under no obligation to provide such information to them.

 

Section 9.05          Lenders’ Representations, Warranties and Acknowledgment. Each Lender represents and warrants that it has made its own independent investigation of the financial condition and affairs of Holdings and its Subsidiaries in connection with Credit Extensions hereunder and that it has made and shall continue to make its own appraisal of the creditworthiness of Holdings and its Subsidiaries.  No Agent shall have any duty or responsibility, either initially or on a continuing basis, to make any such investigation or any such appraisal on behalf of Lenders or to provide any Lender with any credit or other information with respect thereto, whether coming into its possession before the making of the Loans or at any time or times thereafter, and no Agent shall have any responsibility with respect to the accuracy of or the completeness of any information provided to Lenders.

  

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(b)           Each Lender, by delivering its signature page to this Agreement, an Assignment Agreement or a Joinder Agreement and funding its Tranche B Term Loan and/or Revolving Loans on the Closing Date or by the funding of any Incremental Term Loans or Incremental Revolving Loans, as the case may be, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and each other document required to be approved by any Agent, Required Lenders or Lenders, as applicable on the Closing Date or as of the date of funding of such Incremental Term Loans.

 

Section 9.06          Right to Indemnity.  Each Lender, in proportion to its Pro Rata Share, severally agrees to indemnify each Agent, Issuing Bank and Swing Line Lender, to the extent that such Agent, Issuing Bank or Swing Line Lender shall not have been reimbursed by any Loan Party (and without limiting its obligation to do so), for and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses (including counsel fees and disbursements) or disbursements of any kind or nature whatsoever which may be imposed on, incurred by or asserted against such Agent, Issuing Bank or Swing Line Lender in exercising its powers, rights and remedies or performing its duties hereunder or under the other Loan Documents or otherwise in its capacity as such Agent in any way relating to or arising out of this Agreement or the other Loan Documents; provided, that no Lender shall be liable for any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting from such Agent’s, Issuing Bank’s Swing Lien Lender’s, as applicable gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent jurisdiction.  If any indemnity furnished to any Agent, Issuing Bank or Swing Line Lenders, for any purpose shall, in the opinion of such Agent, Issuing Bank or Swing Line Lender, as applicable, be insufficient or become impaired, such Agent, Issuing Bank or Swing Line Lender, as applicable, may call for additional indemnity and cease, or not commence, to do the acts indemnified against until such additional indemnity is furnished; provided, that in no event shall this sentence require any Lender to indemnify any Agent, Issuing Bank or Swing Line Lender against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement in excess of such Lender’s Pro Rata Share thereof; and provided, further, that this sentence shall not be deemed to require any Lender to indemnify any Agent, Issuing Bank or Swing Line Lender against any liability, obligation, loss, damage, penalty, action, judgment, suit, cost, expense or disbursement described in the proviso in the immediately preceding sentence.

  

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Section 9.07          Successor Administrative Agent, Collateral Agent and Swing Line Lender.  The Administrative Agent shall have the right to resign at any time by giving prior written notice thereof to the Lenders and the Borrower.  The Administrative Agent shall have the right to appoint a financial institution to act as the Administrative Agent and/or the Collateral Agent hereunder, subject to the reasonable satisfaction of the Borrower and the Required Lenders, and the Administrative Agent’s resignation shall become effective on the earlier of (i) the acceptance of such successor Administrative Agent by the Borrower and the Required Lenders or (ii) the thirtieth day after such notice of resignation.  Upon any such notice of resignation, if a successor Administrative Agent has not already been appointed by the retiring Administrative Agent, Required Lenders shall have the right, upon five (5) Business Days’ notice to the Borrower, to appoint a successor Administrative Agent, subject to the reasonable satisfaction of the Borrower so long as no Event of Default has occurred and is continuing on the date such appointment is to become effective.  If neither Required Lenders nor the Administrative Agent have appointed a successor Administrative Agent, then the Required Lenders shall be deemed to have succeeded to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent; provided, that until a successor Administrative Agent is so appointed by Required Lenders or the Administrative Agent, the Administrative Agent, by notice to the Borrower and Required Lenders, may retain its role as the Collateral Agent under any Security Document.  Upon the acceptance of any appointment as the Administrative Agent hereunder by a successor Administrative Agent, that successor Administrative Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent and the retiring Administrative Agent shall promptly (i) transfer to such successor Administrative Agent all sums, Securities and other items of Collateral held under the Security Documents, together with all records and other documents necessary or appropriate in connection with the performance of the duties of the successor Administrative Agent under the Loan Documents, and (ii) execute and deliver to such successor Administrative Agent such amendments to financing statements, and take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Administrative Agent of the security interests created under the Security Documents, whereupon such retiring Administrative Agent shall be discharged from its duties and obligations hereunder.  Except as provided above, any resignation of Barclays Bank or its successor as the Administrative Agent pursuant to this Section shall also constitute the resignation of Barclays Bank or its successor as the Collateral Agent.  After any retiring Administrative Agent’s resignation hereunder as the Administrative Agent, the provisions of this Section 9 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrative Agent hereunder.  Any successor Administrative Agent appointed pursuant to this Section shall, upon its acceptance of such appointment, become the successor Collateral Agent for all purposes hereunder.  If Barclays Bank or its successor as the Administrative Agent pursuant to this Section has resigned as the Administrative Agent but retained its role as the Collateral Agent and no successor Collateral Agent has become the Collateral Agent pursuant to the immediately preceding sentence, Barclays Bank or its successor may resign as the Collateral Agent upon notice to the Borrower and Required Lenders at any time.

 

(b)           In addition to the foregoing, the Collateral Agent may resign at any time by giving thirty (30) days’ prior written notice thereof to Lenders and the Grantors.  The Administrative Agent shall have the right to appoint a financial institution as the Collateral Agent hereunder, subject to the reasonable satisfaction of the Borrower and the Required Lenders and the Collateral Agent’s resignation shall become effective on the earlier of (i) the acceptance of such successor Collateral Agent by the Borrower and the Required Lenders or (ii) the thirtieth day after such notice of resignation.  Upon any such notice of resignation, Required Lenders shall have the right, upon five (5) Business Days’ notice to the Administrative Agent, to appoint a successor Collateral Agent, subject to the reasonable satisfaction of the Borrower, so long as no Event of Default has occurred and is continuing on the date such appointment is to become effective.  Upon the acceptance of any appointment as the Collateral Agent hereunder by a successor Collateral Agent, the successor Collateral Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Collateral Agent under this Agreement and the Security Documents, and the retiring Collateral Agent under this Agreement shall promptly (i) transfer to such successor Collateral Agent all sums, Securities and other items of Collateral held hereunder or under the Security Documents, together with all records and other documents necessary or appropriate in connection with the performance of the duties of the successor Collateral Agent under this Agreement and the Security Documents, and (ii) execute and deliver to such successor Collateral Agent or otherwise authorize the filing of such amendments to financing statements, and take such other actions, as may be necessary or appropriate in connection with the assignment to such successor Collateral Agent of the security interests created under the Security Documents, whereupon such retiring Collateral Agent shall be discharged from its duties and obligations under this Agreement and the Security Documents.  After any retiring Collateral Agent’s resignation hereunder as the Collateral Agent, the provisions of this Agreement and the Security Documents shall inure to its benefit as to any actions taken or omitted to be taken by it under this Agreement or the Security Documents while it was the Collateral Agent hereunder.

  

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(c)           Any resignation of Barclays Bank or its successor as the Administrative Agent pursuant to this Section shall also constitute the resignation of Barclays Bank or its successor as the Swing Line Lender, and any successor Administrative Agent appointed pursuant to this Section shall, upon its acceptance of such appointment, become the successor Swing Line Lender for all purposes hereunder.  In such event (a) the Borrower shall prepay any outstanding Swing Line Loans made by the retiring Administrative Agent in its capacity as Swing Line Lender, (b) upon such prepayment, the retiring Administrative Agent and Swing Line Lender shall surrender any Swing Line Note held by it to the Borrower for cancellation and (c) the Borrower shall issue, if so requested by the successor Administrative Agent and Swing Line Lender, a new Swing Line Note to the successor Administrative Agent and Swing Line Lender, in the principal amount of the Swing Line Sublimit then in effect and with other appropriate insertions.3

 

Section 9.08          Security Documents and Guaranty.

 

(a)           Agents under Security Documents and Guaranty.  Each Secured Party hereby further authorizes the Administrative Agent or the Collateral Agent, as applicable, on behalf of and for the benefit of Secured Parties, to be the agent for and representative of Secured Parties with respect to the Guaranty, the Collateral and the Security Documents; provided, that, except as expressly set forth herein, neither the Administrative Agent nor the Collateral Agent shall owe any fiduciary duty, duty of loyalty, duty of care, duty of disclosure or any other obligation whatsoever to any holder of Obligations.  Subject to Section 10.05, without further written consent or authorization from any Secured Party, the Administrative Agent or the Collateral Agent, as applicable may execute any documents or instruments necessary to (i) in connection with a sale or disposition of assets permitted by this Agreement, release any Lien encumbering any item of Collateral that is the subject of such sale or other disposition of assets or to which Required Lenders (or such other Lenders as may be required to give such consent under Section 10.05) have otherwise consented or (ii) release any Guarantor from the Guaranty pursuant to Section 7.12 or with respect to which Required Lenders (or such other Lenders as may be required to give such consent under Section 10.05) have otherwise consented.

 

3 Additional provisions regarding automatic removal of Barclays as Issuing Bank to be determined.

  

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(b)           Right to Realize on Collateral and Enforce Guaranty.  Anything contained in any of the Loan Documents to the contrary notwithstanding, the Borrower, the Administrative Agent, the Collateral Agent and each Secured Party hereby agree that (i) no Secured Party shall have any right individually to realize upon any of the Collateral or to enforce the Guaranty, it being understood and agreed that all powers, rights and remedies hereunder may be exercised solely by the Administrative Agent, on behalf of the Secured Parties in accordance with the terms hereof and all powers, rights and remedies under the Security Documents may be exercised solely by the Collateral Agent and (ii) in the event of a foreclosure by the Collateral Agent on any of the Collateral pursuant to a public or private sale or other disposition, the Collateral Agent or any Lender may be the purchaser or licensor of any or all of such Collateral at any such sale or other disposition and the Collateral Agent, as agent for and representative of Secured Parties (but not any Lender or Lenders in its or their respective individual capacities unless Required Lenders shall otherwise agree in writing) shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such public sale, to use and apply any of the Obligations as a credit on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other disposition.

 

(c)           Rights under Hedge Agreements.  No Hedge Agreement shall create (or be deemed to create) in favor of any Lender Counterparty that is a party thereto any rights in connection with the management or release of any Collateral or of the obligations of any Guarantor under the Loan Documents except as expressly provided in Section 10.05(c)(v) of this Agreement and Sections 9.2 and 10 of the Pledge and Security Agreement.  By accepting the benefits of the Collateral, such Lender Counterparty shall be deemed to have appointed the Collateral Agent as its agent and agreed to be bound by the Loan Documents as a Secured Party, subject to the limitations set forth in this clause (c).

 

(d)           Release of Collateral and Guarantees, Termination of Loan Documents.  Notwithstanding anything to the contrary contained herein or any other Loan Document, when all Obligations (other than contingent indemnification obligations not yet due and payable) have been paid in full, all Commitments have terminated or expired or been cancelled and no Letter of Credit shall be outstanding (or if any Letter of Credit remains outstanding, each such Letter of Credit shall have been backstopped or cash collateralized to the satisfaction of the Issuing Bank), upon request of the Borrower, the Administrative Agent and the Collateral Agent shall (without notice to, or vote or consent of, any Lender or any Lender Counterparty) take such actions as shall be required to release its security interest in all Collateral, and to release all guarantee obligations provided for in any Loan Document.  Any such release of guarantee obligations shall be deemed subject to the provision that such guarantee obligations shall be reinstated if after such release any portion of any payment in respect of  the Obligations guaranteed thereby shall be rescinded or must otherwise be restored or returned upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as though such payment had not been made.

 

Section 9.09          Withholding Taxes.  To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax.  If the Internal Revenue Service or any other Governmental Authority asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the exemption from, or reduction of, withholding Tax ineffective or for any other reason, such Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred.

  

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Section 9.10          Administrative Agent May File Proofs of Claim.  In case of the pendency of any proceeding under the Bankruptcy Code or other applicable law or any other judicial proceeding relative to the Borrower, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise (a) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the other Secured Parties (including fees, disbursements and other expenses of counsel) allowed in such judicial proceeding and (b) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same.  Any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender and other Secured Party to make such payments to the Administrative Agent.  Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender or other Secured Party any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender or other Secured Party to authorize the Administrative Agent to vote in respect of the claim of such Person or in any such proceeding.

 

ARTICLE X.

MISCELLANEOUS

 

Section 10.01       Notices

 

(a)           Notices Generally.  Any notice or other communication herein required or permitted to be given to a Loan Party, the Co-Syndication Agents, the Collateral Agent, the Administrative Agent, the Swing Line Lender, the Issuing Bank or the Documentation Agent, shall be sent to such Person’s address as set forth on Schedule 1.01(c) or in the other relevant Loan Document, and in the case of any Lender, the address as indicated on Schedule 1.01(c) or otherwise indicated to the Administrative Agent in writing.  Except as otherwise set forth in paragraph (b) below, each notice hereunder shall be in writing and may be personally served, telexed or sent by telefacsimile or United States mail or courier service and shall be deemed to have been given when delivered in person or by courier service and signed for against receipt thereof, upon receipt of telefacsimile or telex, or three (3) Business Days after depositing it in the United States mail with postage prepaid and properly addressed; provided, that no notice to any Agent shall be effective until received by such Agent; provided, further, that any such notice or other communication shall at the request of the Administrative Agent be provided to any sub-agent appointed pursuant to Section 9.03(c) hereto as designated by the Administrative Agent from time to time.

  

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(b)          Electronic Communications.

 

(i)           Notices and other communications to Lenders and the Issuing Bank hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites, including the Platform) pursuant to procedures approved by the Administrative Agent; provided, that the foregoing shall not apply to notices to any Lender or the Issuing Bank pursuant to Article II if such Lender or the Issuing Bank, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Section by electronic communication.  The Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided, further, that approval of such procedures may be limited to particular notices or communications.  Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement); provided, that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next Business Day for the recipient and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

 

(ii)          Each Loan Party understands that the distribution of material through an electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution and agrees and assumes the risks associated with such electronic distribution.

 

(iii)         The Platform and any Approved Electronic Communications are provided “as is” and “as available”.  None of the Agents nor any of their respective officers, directors, employees, agents, advisors or representatives (the “Agent Affiliates”) warrant the accuracy, adequacy, or completeness of the Approved Electronic Communications or the Platform and each expressly disclaims liability for errors or omissions in the Platform and the Approved Electronic Communications.  No warranty of any kind, express, implied or statutory, including any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects is made by the Agent Affiliates in connection with the Platform or the Approved Electronic Communications.  Each party hereto agrees that no Agent has any responsibility for maintaining or providing any equipment, software, services or any testing required in connection with any Approved Electronic Communication or otherwise required for the Platform.  In no event shall any Agent nor any of the Agent Affiliates have any liability to any Loan Party, any Lender or any other Person for damages of any kind, whether or not based on strict liability and including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party’s or any Agent’s transmission of communications through the internet, except to the extent the liability of any such Person is found in a final ruling by a court of competent jurisdiction to have resulted from such Person’s gross negligence or willful misconduct. No Agent or Agent Affiliate shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.

  

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(iv)         Each Loan Party, each Lender, the Issuing Bank and each Agent agrees that the Administrative Agent may, but shall not be obligated to, store any Approved Electronic Communications on the Platform in accordance with the Administrative Agent’s customary document retention procedures and policies.

 

(v)          All uses of the Platform shall be governed by and subject to, in addition to this Section 10.01, separate terms and conditions posted or referenced in such Platform and related agreements executed by the Lenders and their Affiliates in connection with the use of such Platform.

 

(vi)         Any notice of Default or Event of Default may be provided by telephonic notice if confirmed promptly thereafter by delivery of written notice thereof.

 

(c)          Change of Address.  Any party hereto may changes its address or telecopy number for notices and other communications hereunder by written notice to the other parties hereto.

 

Section 10.02       Expenses.  Whether or not the transactions contemplated hereby are consummated, the Borrower agrees to pay promptly (a) all the actual and reasonable costs and expenses incurred in connection with the negotiation, preparation and execution of the Loan Documents and any consents, amendments, supplements, waivers or other modifications thereto; (b) all the costs of furnishing all opinions by counsel for the Borrower and the other Loan Parties; (c) the reasonable fees, expenses and disbursements of counsel to Agents (in each case including allocated costs of internal counsel) in connection with the negotiation, preparation, execution and administration of the Loan Documents and any consents, amendments, supplements, waivers or other modifications thereto and any other documents or matters requested by the Borrower; (d) all the actual costs and reasonable expenses of creating, perfecting, recording, maintaining and preserving Liens in favor of the Collateral Agent, for the benefit of Secured Parties, including filing and recording fees, expenses and Taxes, stamp or documentary Taxes, search fees, title insurance premiums and reasonable fees, expenses and disbursements of counsel to each Agent and of counsel providing any opinions that any Agent or Required Lenders may request in respect of the Collateral or the Liens created pursuant to the Security Documents; (e) all the actual costs and reasonable fees, expenses and disbursements of any auditors, accountants, consultants or appraisers; (f) all the actual costs and reasonable expenses (including the reasonable fees, expenses and disbursements of any appraisers, consultants, advisors and agents employed or retained by the Collateral Agent and its counsel) in connection with the custody or preservation of any of the Collateral; (g) all other actual and reasonable costs and expenses incurred by each Agent in connection with the syndication of the Loans and Commitments and the transactions contemplated by the Loan Documents and any consents, amendments, supplements, waivers or other modifications thereto; and (h) all costs and expenses, including reasonable attorneys’ fees (including allocated costs of internal counsel) and costs of settlement, incurred by any Agent or Lender in enforcing any Obligations of or in collecting any payments due from any Loan Party hereunder or under the other Loan Documents (including in connection with the sale, lease or license of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty) or in connection with any refinancing or restructuring of the credit arrangements provided hereunder in the nature of a “work-out” or pursuant to any insolvency or bankruptcy cases or proceedings.  All amounts due under this Section 10.02 shall be due and payable within five days after demand therefor.

  

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Section 10.03       Indemnity.

 

(a)           In addition to the payment of expenses pursuant to Section 10.02, whether or not the transactions contemplated hereby are consummated, each Loan Party agrees to defend (subject to Indemnitees’ rights to selection of counsel), indemnify, pay and hold harmless, each Agent, Joint Lead Arranger, Issuing Bank, Swing Line Lender and Lender and the officers, partners, members, directors, trustees, shareholders, advisors, employees, representatives, attorneys, controlling persons, agents, sub-agents and Affiliates of each Agent, Joint Lead Arranger, Issuing Bank, Swing Line Lender and Lender, as well as the respective heirs, successors and assigns of the foregoing (each, an “Indemnitee”), from and against any and all Indemnified Liabilities; provided, that no Loan Party shall have any obligation to any Indemnitee hereunder with respect to any Indemnified Liabilities to the extent such Indemnified Liabilities arise from the gross negligence or willful misconduct of that Indemnitee, in each case, as determined by a final, non-appealable judgment of a court of competent jurisdiction.  Without limiting the foregoing, and to the extent permitted by applicable law, each Loan Party agrees not to assert and hereby waives all rights for contribution or any other rights of recovery with respect to all Indemnified Liabilities relating to or arising out of any Environmental Claim or any Hazardous Materials activity.  To the extent that the undertakings to defend, indemnify, pay and hold harmless set forth in this Section 10.03 may be unenforceable in whole or in part because they are violative of any law or public policy, the applicable Loan Party shall contribute the maximum portion that it is permitted to pay and satisfy under applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of them.

 

(b)           To the extent permitted by applicable law, no Loan Party shall assert, and each Loan Party hereby waives, any claim against each Agent, Joint Lead Arranger, Issuing Bank, Swing Line Lender and Lender and their respective Affiliates, officers, partners, members, directors, trustees, shareholders, advisors, employees, representatives, attorneys, controlling persons, agents and sub-agents on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) (whether or not the claim therefor is based on tort, contract or duty imposed by any applicable legal requirement) arising out of, in connection with, as a result of or in any way related to this Agreement or any Loan Document or any agreement or instrument contemplated hereby or thereby or referred to herein or therein, the transactions contemplated hereby or thereby, any Loan or the use of the proceeds thereof or any act or omission or event occurring in connection therewith, and each Loan Party hereby waives, releases and agrees not to sue upon any such claim or any such damages, whether or not accrued and whether or not known or suspected to exist in its favor.  No Indemnitee shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby.

  

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(c)           All amounts due under this Section 10.03 shall be due and payable within five days after demand therefor.

 

Section 10.04       Set-Off.  In addition to any rights now or hereafter granted under applicable law and not by way of limitation of any such rights, upon the occurrence of any Event of Default each Lender (which term shall for the purposes of this Section 10.04 include the Issuing Bank) is hereby authorized by each Loan Party at any time or from time to time subject to the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed), without notice to any Loan Party or to any other Person (other than the Administrative Agent), any such notice being hereby expressly waived to the fullest extent permitted by applicable law, to set off and to appropriate and to apply any and all deposits (time or demand, provisional or final, general or special, including Indebtedness evidenced by certificates of deposit, whether matured or unmatured, but not including trust accounts) and any other Indebtedness at any time held or owing by such Lender to or for the credit or the account of any Loan Party against and on account of the obligations and liabilities of any Loan Party to such Lender hereunder, the Letters of Credit and participations therein and under the other Loan Documents, including all claims of any nature or description arising out of or connected hereto, the Letters of Credit and participations therein or with any other Loan Document, irrespective of whether or not (a) such Lender shall have made any demand hereunder or (b) the principal of or the interest on the Loans or any amounts in respect of the Letters of Credit or any other amounts due hereunder shall have become due and payable pursuant to Article II and although such obligations and liabilities, or any of them, may be contingent or unmatured.

 

Section 10.05       Amendments and Waivers.

 

(a)          Required Lenders’ Consent.  Subject to the additional requirements of Sections 10.05(b) and 10.05(c), no amendment, supplement, modification, termination or waiver of any provision of the Loan Documents, or consent to any departure by any Loan Party therefrom, shall in any event be effective without the written concurrence of the Required Lenders (delivery of an executed counterpart of a signature page to the applicable amendment, supplement, modification, termination or waiver by facsimile or other electronic transmission will be effective as delivery of a manually executed counterpart thereof).

 

(b)          Affected Lenders’ Consent.  Without the written consent of each Lender that would be directly and adversely affected thereby, no amendment, supplement, modification, termination, or consent shall be effective if the effect thereof would:

 

(i)           extend the scheduled final maturity of any Loan or Note;

 

(ii)          waive, reduce or postpone any scheduled repayment (but not prepayment) of principal;

 

(iii)         extend the stated expiration date of any Letter of Credit beyond the Revolving Commitment Termination Date;

  

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(iv)         reduce the rate of interest on any Loan (other than any waiver of any increase in the interest rate applicable to any Loan pursuant to Section 2.10) or any fee or any premium payable hereunder; provided, that only the consent of the Required Lenders shall be necessary to amend the Default Rate in Section 2.10 or to waive any obligation of the Borrower to pay interest at the Default Rate;

 

(v)          waive or extend the time for payment of any such interest, fees or premiums;

 

(vi)         reduce or forgive the principal amount of any Loan or any reimbursement obligation in respect of any Letter of Credit;

 

(vii)        amend, modify, terminate or waive any provision of Section 2.13(b)(ii), Section 2.16(c), Section 2.17, this Section 10.05(b), Section 10.05(c) or any other provision of this Agreement that expressly provides that the consent of all Lenders is required;

 

(viii)       amend the definition of “Required Lenders” or the definition of “Pro Rata Share”; provided that with the consent of Required Lenders, additional extensions of credit pursuant hereto may be included in the determination of “Required Lenders” or “Pro Rata Share” on substantially the same basis as the Term Loan Commitments, the Term Loans, the Revolving Commitments and the Revolving Loans are included on the Closing Date;

 

(ix)         (a) release all or substantially all of the Collateral or all or substantially all of the Guarantors from the Guaranty or (b) subordinate the Lien of the Collateral Agent on all or substantially all the Collateral or subordinate any Guaranty of the Guarantors, except in each case as expressly provided in the Loan Documents;

 

(x)          consent to the assignment or transfer by any Loan Party of any of its rights and obligations under any Loan Document except as expressly provided in any Loan Document; or

 

provided that, for the avoidance of doubt, all Lenders shall be deemed directly and adversely affected thereby with respect to any amendment described in clauses (vii), (viii), (ix) and (x).

 

(c)          Other Consents.  No amendment, modification, termination or waiver of any provision of the Loan Documents, or consent to any departure by any Loan Party therefrom, shall:

 

(i)           increase any Revolving Commitment of any Lender over the amount thereof then in effect without the consent of such Lender; provided that no amendment, modification or waiver of any condition precedent, covenant, Default or Event of Default shall be deemed to constitute an increase in any Revolving Commitment of any Lender;

  

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(ii)          amend, modify, terminate or waive any provision hereof relating to the Swing Line Sublimit or the Swing Line Loans without the consent of Swing Line Lender;

 

(iii)         alter the required application of any repayments or prepayments as between Classes pursuant to Section 2.15 without the consent of Lenders holding more than 50.0% of the aggregate Term Loan Exposure of all Lenders, Revolving Exposure of all Lenders or Incremental Term Loan Exposure of all Lenders, as applicable, of each Class which is being allocated a lesser repayment or prepayment as a result thereof; provided, that Required Lenders may waive, in whole or in part, any prepayment so long as the application, as between Classes, of any portion of such prepayment which is still required to be made is not altered;

 

(iv)        amend, modify, terminate or waive any obligation of Lenders relating to the purchase of participations in Letters of Credit as provided in Section 2.04(e) without the written consent of the Administrative Agent and of the Issuing Bank;

 

(v)         amend, modify or waive this Agreement or the Pledge and Security Agreement so as to alter the ratable treatment of Obligations arising under the Loan Documents and Obligations arising under Hedge Agreements or the definition of “Lender Counterparty,” “Hedge Agreement,” “Obligations,” or “Secured Obligations” (as defined in any applicable Security Document) in each case in a manner adverse to any Lender Counterparty with Obligations then outstanding without the written consent of any such Lender Counterparty (or, in the case of the HSBC Hedge Agreement, GECC) or release all or substantially all of the Collateral or all or substantially all of the Guarantors from the Guaranty except as expressly provided in the Loan Documents without the written consent of each Lender Counterparty (or, in the case of the HSBC Hedge Agreement, GECC) with Obligations then outstanding;

 

(vi)        amend, modify, terminate or waive any provision of Article IX as the same applies to any Agent, or any other provision hereof as the same applies to the rights or obligations of any Agent, in each case without the consent of such Agent; or

 

(vii)       amend any condition for the making of any Revolving Loan or Swing Line Loan or the issuing of any Letter of Credit set forth in Section 3.02 without the consent of Lenders holding more than 50.0% of the aggregate Revolving Exposure of all Lenders.

 

(d)          Execution of Amendments, Etc.  The Administrative Agent may, but shall have no obligation to, with the concurrence of any Lender, execute amendments, supplements, modifications, waivers or consents on behalf of such Lender.  Any waiver or consent shall be effective only in the specific instance and for the specific purpose for which it was given.  In the case of any waiver, the parties hereto shall be restored to their former position and rights hereunder and under the other Loan Documents, and any Default or Event of Default waived shall be deemed to be cured and not continuing, but no such waiver shall extend to any subsequent or other Default or Event of Default, or impair any right consequent thereon.  No notice to or demand on any Loan Party in any case shall entitle any Loan Party to any other or further notice or demand in similar or other circumstances.  Any amendment, modification, termination, waiver or consent effected in accordance with this Section 10.05 shall be binding upon each Lender at the time outstanding, each future Lender and, if signed by a Loan Party, on such Loan Party.

  

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Section 10.06        Successors and Assigns; Participations.

 

(a)           Generally.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns and shall inure to the benefit of the parties hereto and the successors and assigns of Lenders.  No Loan Party’s rights or obligations hereunder nor any interest therein may be assigned or delegated by any Loan Party without the prior written consent of all Lenders (and any purported assignment or delegation without such consent shall be null and void).

 

(b)           Register.  The Borrower, the Administrative Agent and Lenders shall deem and treat the Persons listed as Lenders in the Register as the holders and owners of the corresponding Commitments and Loans listed therein for all purposes hereof, and no assignment or transfer of any such Commitment or Loan shall be effective, in each case, unless and until recorded in the Register following receipt of a fully executed Assignment Agreement effecting the assignment or transfer thereof, together with the required forms and certificates regarding Tax matters and any fees payable in connection with such assignment, in each case, as provided in Section 10.06(d).  Each assignment shall be recorded in the Register promptly following receipt by the Administrative Agent of the fully executed Assignment Agreement and all other necessary documents and approvals, prompt notice thereof shall be provided to the Borrower and a copy of such Assignment Agreement shall be maintained, as applicable.  The date of such recordation of a transfer shall be referred to herein as the “Assignment Effective Date”.  Any request, authority or consent of any Person who, at the time of making such request or giving such authority or consent, is listed in the Register as a Lender shall be conclusive and binding on any subsequent holder, assignee or transferee of the corresponding Commitments or Loans.

 

(c)           Right to Assign.  Each Lender shall have the right at any time to sell, assign or transfer all or a portion of its rights and obligations under this Agreement, including all or a portion of its Commitment or Loans owing to it or other Obligations (provided, that pro rata assignments shall not be required and each assignment shall be of a uniform, and not varying, percentage of all rights and obligations under and in respect of any applicable Loan and any related Commitments):

 

(i)           to any Person meeting the criteria of clause (i) of the definition of the term of “Eligible Assignee”; and

  

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(ii)          to any Person meeting the criteria of clause (ii) of the definition of the term of “Eligible Assignee” upon such Person (except in the case of assignments made by or to any Joint Lead Arranger or any of its Affiliates in connection with the primary syndication or otherwise) being consented to by the Administrative Agent and, in the case of assignments of Revolving Loans or Revolving Commitments, the Issuing Bank and the Swing Line Lender and the Borrower (such consents not to be (x) unreasonably withheld or delayed or (y) in the case of the Borrower, required at any time an Event of Default has occurred and is continuing and the consent of the Borrower shall be deemed to have been provided unless it shall object thereto by written notice to the Administrative Agent within 5 Business Days after having received notice thereof); provided, that further each such assignment pursuant to this Section 10.06(c)(ii) shall be in an aggregate amount of not less than (A) $5,000,000 (or such lesser amount as may be agreed to by the Borrower and the Administrative Agent or as shall constitute the aggregate amount of the Revolving Commitments and Revolving Loans of the assigning Lender) with respect to the assignment of the Revolving Commitments and Revolving Loans and (B) $1,000,000 (or such lesser amount as may be agreed to by the Borrower and the Administrative Agent or as shall constitute the aggregate amount of the Tranche B Term Loan or Incremental Term Loans of a Series of the assigning Lender) with respect to the assignment of Term Loans; provided, that the Related Funds of any individual Lender may aggregate their Loans for purposes of determining compliance with such minimum assignment amounts.

 

(d)           Mechanics.  Assignments and assumptions of Loans and Commitments by Lenders shall be effected by manual execution and delivery to the Administrative Agent of an Assignment Agreement.  Assignments made pursuant to the foregoing provision shall be effective as of the Assignment Effective Date.  In connection with all assignments there shall be delivered to the Administrative Agent such forms, certificates or other evidence, if any, with respect to United States federal income Tax withholding matters as the assignee under such Assignment Agreement may be required to deliver pursuant to Section 2.20(c), together with payment to the Administrative Agent of a registration and processing fee of $3,500 (except that no such registration and processing fee shall be payable (y) in connection with an assignment by or to Barclays Bank or any Affiliate thereof or (z) in the case of an Eligible Assignee which is already a Lender or is an Affiliate or Related Fund of a Lender or a Person under common management with a Lender).

 

(e)           Representations and Warranties of Assignee.  Each Lender, upon execution and delivery hereof or upon succeeding to an interest in the Commitments and Loans, as the case may be, represents and warrants as of the Closing Date or as of the Assignment Effective Date that (i) it is an Eligible Assignee; (ii) it has experience and expertise in the making of or investing in commitments or  loans such as the applicable Commitments or Loans, as the case may be; and (iii) it shall make or invest in, as the case may be, its Commitments or Loans for its own account in the ordinary course and without a view to distribution of such Commitments or Loans within the meaning of the Securities Act or the Exchange Act or other federal securities laws (it being understood that, subject to the provisions of this Section 10.06, the disposition of such Commitments or Loans or any interests therein shall at all times remain within its exclusive control).

  

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(f)          Effect of Assignment.  Subject to the terms and conditions of this Section 10.06, as of the “Assignment Effective Date” (i) the assignee thereunder shall have the rights and obligations of a “Lender” hereunder to the extent of its interest in the Loans and Commitments as reflected in the Register and shall thereafter be a party hereto and a “Lender” for all purposes hereof; (ii) the assigning Lender thereunder shall, to the extent that rights and obligations hereunder have been assigned to the assignee, relinquish its rights (other than any rights which survive the termination hereof, including under Section 10.08) and be released from its obligations hereunder (and, in the case of an assignment covering all or the remaining portion of an assigning Lender’s rights and obligations hereunder, such Lender shall cease to be a party hereto on the Assignment Effective Date; provided, that anything contained in any of the Loan Documents to the contrary notwithstanding, (y) the Issuing Bank shall continue to have all rights and obligations thereof with respect to such Letters of Credit until the cancellation or expiration of such Letters of Credit and the reimbursement of any amounts drawn thereunder and (z) such assigning Lender shall continue to be entitled to the benefit of all indemnities hereunder as specified herein with respect to matters arising out of the prior involvement of such assigning Lender as a Lender hereunder); (iii) the Commitments shall be modified to reflect any Commitment of such assignee and any Revolving Commitment of such assigning Lender, if any; and (iv) if any such assignment occurs after the issuance of any Note hereunder, the assigning Lender shall, upon the effectiveness of such assignment or as promptly thereafter as practicable, surrender its applicable Notes to the Administrative Agent for cancellation, and thereupon the Borrower shall issue and deliver new Notes, if so requested by the assignee and/or assigning Lender, to such assignee and/or to such assigning Lender, with appropriate insertions, to reflect the new Revolving Commitments and/or outstanding Loans of the assignee and/or the assigning Lender.  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with the requirements of this Section 10.06 shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 10.06(g).  Any assignment by a Lender pursuant to this Section 10.06 shall not in any way constitute or be deemed to constitute a novation, discharge, rescission, extinguishment or substitution of the Indebtedness hereunder, and any Indebtedness so assigned shall continue to be the same obligation and not a new obligation.

 

(g)          Participations.

 

(i)           Each Lender shall have the right at any time to sell one or more participations to any Person (other than Holdings, any of its Subsidiaries or any of its Affiliates) in all or any part of its Commitments, Loans or in any other Obligation.

 

(ii)          The holder of any such participation, other than an Affiliate of the Lender granting such participation, shall not be entitled to require such Lender to take or omit to take any action hereunder except with respect to any amendment, modification or waiver that would (A) extend the final scheduled maturity of any Loan, Note or Letter of Credit (unless such Letter of Credit is not extended beyond the Revolving Commitment Termination Date) in which such participant is participating, or reduce the rate or extend the time of payment of interest or fees thereon (except in connection with a waiver of applicability of any post-default increase in interest rates) or reduce the principal amount thereof, or increase the amount of the participant’s participation over the amount thereof then in effect (it being understood that a waiver of any Default or Event of Default or of a mandatory reduction in the Commitment shall not constitute a change in the terms of such participation, and that an increase in any Commitment or Loan shall be permitted without the consent of any participant if the participant’s participation is not increased as a result thereof), (B) consent to the assignment or transfer by any Loan Party of any of its rights and obligations under this Agreement, (C) amend the definition of “Required Lenders” (or amend Section 10.05(a) in a manner that has the same effect as an amendment to such definition) or the definition of “Pro Rata Share” or (D) release all or substantially all of the Guarantors or the Collateral under the Security Documents (except as expressly provided in the Loan Documents) supporting the Loans hereunder in which such participant is participating.

  

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(iii)         The Borrower agrees that each participant shall be entitled to the benefits of Sections 2.18(c), 2.19 and 2.20 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (c) of this Section; provided, that (x) a participant shall not be entitled to receive any greater payment under Section 2.19 or 2.20 than the applicable Lender would have been entitled to receive with respect to the participation sold to such participant, unless the sale of the participation to such participant is made with the Borrower’s prior written consent and (y) a participant that would be a Non-U.S. Lender if it were a Lender shall not be entitled to the benefits of Section 2.20 unless the Borrower is notified of the participation sold to such participant and such participant agrees, for the benefit of the Borrower, to comply with Section 2.20 as though it were a Lender; provided, further, that, except as specifically set forth in clauses (x) and (y) of this sentence, nothing herein shall require any notice to the Borrower or any other Person in connection with the sale of any participation.  To the extent permitted by law, each participant also shall be entitled to the benefits of Section 10.4 as though it were a Lender; provided, that such Participant agrees to be subject to Section 2.17 as though it were a Lender.

 

(iv)        Each Lender that sells a participation shall maintain a register on which it enters the name and address of each participant and the principal amounts of each participant’s interest in the Commitments, Loans and other Obligations held by it (the “Participant Register”).  The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such Commitments, Loans and other Obligations as the owner thereof for all purposes of this Agreement notwithstanding any notice to the contrary.  Any such Participant Register shall be available for inspection by the Administrative Agent at any reasonable time and from time to time upon reasonable prior notice.

 

(h)           Certain Other Assignments and Participations.  In addition to any other assignment or participation permitted pursuant to this Section 10.06 any Lender may assign as security and/or pledge (without the consent of the Borrower or the Administrative Agent) all or any portion of its Loans, the other Obligations owed by or to such Lender, and its Notes, if any, to secure obligations of such Lender including any Federal Reserve Bank as collateral security pursuant to Regulation A of the Board of Governors and any operating circular issued by such Federal Reserve Bank; provided, that no Lender, as between the Borrower and such Lender, shall be relieved of any of its obligations hereunder as a result of any such assignment and pledge; provided, further, that in no event shall the applicable Federal Reserve Bank, pledgee or trustee, be considered to be a “Lender” or be entitled to require the assigning Lender to take or omit to take any action hereunder.

  

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Section 10.07        Independence of Covenants, Etc.All covenants, conditions and other terms hereunder and under the other Loan Documents shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, conditions or other terms, the fact that it would be permitted by an exception to, or would otherwise be within the limitations of, another covenant, condition or other term shall not avoid the occurrence of a Default or an Event of Default if such action is taken or condition exists.

 

Section 10.08        Survival of Representations, Warranties and Agreements.  All representations, warranties and agreements made herein shall survive the execution and delivery hereof and the making of any Credit Extension.  Notwithstanding anything herein or implied by law to the contrary, the agreements of each Loan Party set forth in Sections 2.18(c), 2.19, 2.20, 10.02, 10.03 and 10.04 and the agreements of Lenders set forth in Sections 2.17, 9.03(b), 9.06 and 9.09 shall survive the payment of the Loans, the cancellation or expiration of the Letters of Credit and the reimbursement of any amounts drawn thereunder, and the termination hereof.

 

Section 10.09        No Waiver; Remedies Cumulative.  No failure or delay or course of dealing on the part of any Agent or any Lender in the exercise of any power, right or privilege hereunder or under any other Loan Document shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other power, right or privilege.  The rights, powers and remedies given to each Agent and each Lender hereby are cumulative and shall be in addition to and independent of all rights, powers and remedies existing by virtue of any statute or rule of law or in any of the other Loan Documents or any of the Hedge Agreements.  Any forbearance or failure to exercise, and any delay in exercising, any right, power or remedy hereunder shall not impair any such right, power or remedy or be construed to be a waiver thereof, nor shall it preclude the further exercise of any such right, power or remedy.  Without limiting the generality of the foregoing, the making of any Credit Extension shall not be construed as a waiver of any Default or Event of Default, regardless of whether any Agent, Issuing Bank or Lender may have had notice or knowledge of such Default or Event of Default at the time of the making of any such Credit Extension.

 

Section 10.10        Marshalling; Payments Set Aside.  Neither any Agent nor any Lender shall be under any obligation to marshal any assets in favor of any Loan Party or any other Person or against or in payment of any or all of the Obligations.  To the extent that any Loan Party makes a payment or payments to the Administrative Agent or Lenders (or to the Administrative Agent, on behalf of Lenders), or any Agent or Lenders enforce any security interests or exercise their rights of setoff, and such payment or payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver or any other party under any bankruptcy law, any other state or federal law, common law or any equitable cause, then, to the extent of such recovery, the obligation or part thereof originally intended to be satisfied, and all Liens, rights and remedies therefor or related thereto, shall be revived and continued in full force and effect as if such payment or payments had not been made or such enforcement or setoff had not occurred.

 

Section 10.11        Severability.  In case any provision in or obligation hereunder or under any other Loan Document shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby (it being understood that the invalidity, illegality or unenforceability of a particular provision in a particular jurisdiction shall not in and of itself affect the validity, legality or enforceability of such provision in any other jurisdiction).  The parties hereto shall endeavor in good faith negotiations to replace any invalid, illegal or unenforceable provisions with valid, legal and enforceable provisions the economic effect of which comes as close as reasonably possible to that of the invalid, illegal or unenforceable provisions.

  

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Section 10.12        Obligations Several; Independent Nature of Lenders’ Rights.  The obligations of Lenders hereunder are several and no Lender shall be responsible for the obligations or Commitment of any other Lender hereunder.  Nothing contained herein or in any other Loan Document, and no action taken by Lenders pursuant hereto or thereto, shall be deemed to constitute Lenders as a partnership, an association, a joint venture or any other kind of entity. The amounts payable at any time hereunder to each Lender shall be a separate and independent debt, and each Lender shall be entitled to protect and enforce its rights arising out hereof and it shall not be necessary for any other Lender to be joined as an additional party in any proceeding for such purpose.

 

Section 10.13        Table of Contents and Headings.  The Table of Contents hereof and Article and Section headings herein are included herein for convenience of reference only and shall not constitute a part hereof for any other purpose, modify or amend the terms or conditions hereof, be used in connection with the interpretation of any term or condition hereof or be given any substantive effect.

 

Section 10.14        APPLICABLE LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THAT WOULD RESULT IN THE APPLICATION OF ANY LAW OTHER THAN THE LAW OF THE STATE OF NEW YORK.

 

Section 10.15       CONSENT TO JURISDICTION.  SUBJECT TO CLAUSE (E) OF THE FOLLOWING SENTENCE, ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PARTY ARISING OUT OF OR RELATING HERETO OR ANY OTHER LOAN DOCUMENT, OR ANY OF THE OBLIGATIONS, SHALL BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK.  BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH LOAN PARTY, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, HEREBY EXPRESSLY AND IRREVOCABLY (A) ACCEPTS GENERALLY AND UNCONDITIONALLY THE EXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS (OTHER THAN WITH RESPECT TO ACTIONS BY ANY AGENT IN RESPECT OF RIGHTS UNDER ANY SECURITY AGREEMENT GOVERNED BY A LAWS OTHER THAN THE LAWS OF THE STATE OF NEW YORK OR WITH RESPECT TO ANY COLLATERAL SUBJECT THERETO); (B) WAIVES (I) JURISDICTION AND VENUE OF COURTS IN ANY OTHER JURISDICTION IN WHICH IT MAY BE ENTITLED TO BRING SUIT BY REASON OF ITS PRESENT OR FUTURE DOMICILE OR OTHERWISE AND (II) ANY DEFENSE OF FORUM NON CONVENIENS; (C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE LOAN PARTY AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.01; (D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE LOAN PARTY IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (E) AGREES THAT THE AGENTS AND THE LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY LOAN PARTY IN THE COURTS OF ANY OTHER JURISDICTION IN CONNECTION WITH THE EXERCISE OF ANY RIGHTS UNDER ANY SECURITY DOCUMENT OR THE ENFORCEMENT OF ANY JUDGMENT.

  

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Section 10.16        WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.  THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.  EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 10.17 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER WILL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER.  IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

  

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Section 10.17        Confidentiality.  Each Agent and each Lender (which term shall for the purposes of this Section 10.17 include the Issuing Bank) shall hold all non-public information regarding the Loan Parties and their Subsidiaries and their businesses identified as such by the Borrower and obtained by such Agent or such Lender pursuant to the requirements hereof in accordance with such Agent’s and such Lender’s customary procedures for handling confidential information of such nature, it being understood and agreed by the Borrower that, in any event, the Administrative Agent may disclose such information to the Lenders and each Agent and each Lender may make (i) disclosures of such information to Affiliates or Related Funds of such Lender or Agent and to their respective officers, directors, employees, representatives, agents and advisors (and to other Persons authorized by a Lender or Agent to organize, present or disseminate such information in connection with disclosures otherwise made in accordance with this Section 10.17), (ii) disclosures of such information reasonably required by (A) any pledgee referred to in Section 10.06(h), (B) any bona fide or potential assignee, transferee or participant in connection with the contemplated assignment, transfer or participation of any Loans or any participations therein, (C) any bona fide or potential direct or indirect contractual counterparties (or the professional advisors thereto) to any swap or derivative transaction relating to any Loan Party and its obligations or (D) any direct or indirect investor or prospective investor in a Related Fund; provided, that such pledgees, assignees, transferees, participants, counterparties, advisors and investors are advised of and agree to be bound by either the provisions of this Section 10.17 or other provisions at least as restrictive as this Section 10.17, (iii) disclosure to any rating agency when required by it; provided, that, prior to any disclosure, such rating agency be instructed to preserve the confidentiality of any confidential information relating to the Loan Parties received by it from any Agent or any Lender, (iv) disclosures in connection with the exercise of any remedies hereunder or under any other Loan Document and (v) disclosures required or requested by any governmental agency or representative thereof or by the NAIC or pursuant to legal or judicial process; provided, that unless specifically prohibited by applicable law or court order, each Lender and each Agent shall make reasonable efforts to notify the Borrower of any request by any governmental agency or representative thereof (other than any such request in connection with any examination of the financial condition or other routine examination of such Lender by such governmental agency) for disclosure of any such non-public information prior to disclosure of such information.  In addition, each Agent and each Lender may disclose the existence of this Agreement and the information about this Agreement to market data collectors, similar services providers to the lending industry, and service providers to the Agents and the Lenders in connection with the administration and management of this Agreement and the other Loan Documents.  Notwithstanding anything to the contrary set forth herein, each party (and each of their respective employees, representatives or other agents) may disclose to any and all persons without limitation of any kind, the tax treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions and other tax analyses) that are provided to any such party relating to such tax treatment and tax structure.  However, any information relating to the tax treatment or tax structure shall remain subject to the confidentiality provisions hereof (and the foregoing sentence shall not apply) to the extent reasonably necessary to enable the parties hereto, their respective Affiliates, and their and their respective Affiliates’ directors and employees to comply with applicable securities laws.  For this purpose, “tax structure” means any facts relevant to the federal income tax treatment of the transactions contemplated by this Agreement but does not include information relating to the identity of any of the parties hereto or any of their respective Affiliates.

  

135

  

Section 10.18        Usury Savings Clause.  Notwithstanding any other provision herein, the aggregate interest rate charged with respect to any of the Obligations, including all charges or fees in connection therewith deemed in the nature of interest under applicable law, shall not exceed the Highest Lawful Rate.  If the rate of interest (determined without regard to the preceding sentence) under this Agreement at any time exceeds the Highest Lawful Rate, the outstanding amount of the Loans made hereunder shall bear interest at the Highest Lawful Rate until the total amount of interest due hereunder equals the amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect.  In addition, if when the Loans made hereunder are repaid in full the total interest due hereunder (taking into account the increase provided for above) is less than the total amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times been in effect, then to the extent permitted by law, the Borrower shall pay to the Administrative Agent an amount equal to the difference between the amount of interest paid and the amount of interest which would have been paid if the Highest Lawful Rate had at all times been in effect.  Notwithstanding the foregoing, it is the intention of Lenders and the Borrower to conform strictly to any applicable usury laws.  Accordingly, if any Lender contracts for, charges, or receives any consideration which constitutes interest in excess of the Highest Lawful Rate, then any such excess shall be cancelled automatically and, if previously paid, shall at such Lender’s option be applied to the outstanding amount of the Loans made hereunder or be refunded to the Borrower.

 

Section 10.19        Counterparts.  This Agreement may be executed in any number of counterparts (and by different parties hereto on different counterparts), each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument.  Delivery of an executed counterpart of a signature page to this Agreement by facsimile or other electronic transmission will be effective as delivery of a manually executed counterpart thereof.

 

Section 10.20        Effectiveness; Entire Agreement; No Third Party Beneficiaries.  This Agreement shall become effective upon the execution of a counterpart hereof by each of the parties hereto and receipt by the Borrower and the Administrative Agent of written notification of such execution and authorization of delivery thereof.  With the exception of those terms contained in Sections 1 (with respect to the allocation of titles and roles only), 3 (only to the extent the Transactions are consummated and the Closing Date occurs), 5, 6 (with respect to the amendment, waiver or modification of any term or provision in the Commitment Letter (as defined below)), 8 and 9 of the Commitment and Term Loan Engagement Letter, dated March 12, 2010, between Barclays Capital, DBSI, Deutsche Bank Trust Company Americas, GECC, GECM, Royal Bank of Canada, RBC Capital Markets and Jefferies Finance LLC, the Borrower and Holdings (the “Commitment Letter”), which by the terms of the Commitment Letter remain in full force and effect (such terms the “Surviving Terms”) all of the Joint Lead Arrangers’, and their Affiliates obligations under the Commitment Letter shall terminate and be superseded by the Loan Documents and the Joint Lead Arrangers and their respective Affiliates shall be released from all liability in connection therewith, including any claim for injury or damages, whether consequential, special, direct, indirect, punitive or otherwise.  This Agreement and the other Loan Documents represent the entire agreement of Holdings and its Subsidiaries, the Agents, the Issuing Bank, the Swing Line Lender, the Joint Lead Arrangers and the Lenders with respect to the subject matter hereof and thereof, and there are no promises, undertakings, representations or warranties by any Agent, Issuing Bank, Swing Line Lender, Joint Lead Arranger or Lender relative to the subject matter hereof or thereof not expressly set forth or referred to herein or in the other Loan Documents.  Nothing in this Agreement or in the other Loan Documents, express or implied, shall be construed to confer upon any Person (other than the parties hereto and thereto, their respective successors and assigns permitted hereunder and, to the extent expressly contemplated hereby, Affiliates of each of the Agents and Lenders, holders of participations in all or any part of a Lender’s Commitments, Loans or in any other Obligations, and the Indemnitees) any rights, remedies, obligations, claims or liabilities under or by reason of this Agreement or the other Loan Documents.  In the event of any conflict between the provisions of this Agreement and those of any other Loan Document, the provisions of this Agreement shall control; provided that the inclusion of supplemental rights or remedies in favor of any Agent, the Issuing Bank or the Lenders in any other Loan Document shall not be deemed a conflict with this Agreement.

  

136

  

Section 10.21        PATRIOT Act.  Each Lender and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies each Loan Party that pursuant to the requirements of the PATRIOT Act, it is required to obtain, verify and record information that identifies each Loan Party, which information includes the name and address of each Loan Party and other information that shall allow such Lender or the Administrative Agent, as applicable, to identify such Loan Party in accordance with the PATRIOT Act.

 

Section 10.22        Electronic Execution of Assignments.  The words “execution,” “signed,” “signature,” and words of like import in any Assignment Agreement shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

 

Section 10.23        No Fiduciary Duty.  Each Agent, each Lender, each Joint Lead Arranger, the Issuing Bank, the Swing Line Lender and their respective Affiliates (collectively, solely for purposes of this paragraph, the “Lenders”), may have economic interests that conflict with those of the Borrower, its stockholders and/or its Affiliates.  The Borrower agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between any Lender, on the one hand, and the Borrower, its stockholders or its Affiliates, on the other.  The Loan Parties acknowledge and agree that (i) the transactions contemplated by the Loan Documents (including the exercise of rights and remedies hereunder and thereunder) are arm’s-length commercial transactions between the Lenders, on the one hand, and the Borrower, on the other, and (ii) in connection therewith and with the process leading thereto, (x) no Lender has assumed an advisory or fiduciary responsibility in favor of the Borrower, its stockholders or its Affiliates with respect to the transactions contemplated hereby (or the exercise of rights or remedies with respect thereto) or the process leading thereto (irrespective of whether any Lender has advised, is currently advising or will advise the Borrower, its stockholders or its Affiliates on other matters) or any other obligation to the Borrower except the obligations expressly set forth in the Loan Documents and (y) each Lender is acting solely as principal and not as the agent or fiduciary of the Borrower, its management, stockholders, creditors or any other Person.  The Borrower acknowledges and agrees that the Borrower has consulted its own legal and financial advisors to the extent it deemed appropriate and that it is responsible for making its own independent judgment with respect to such transactions and the process leading thereto.  The Borrower agrees that it will not claim that any Lender has rendered advisory services of any nature or respect, or owes a fiduciary or similar duty to the Borrower, in connection with such transaction or the process leading thereto.

 

[Remainder of page intentionally left blank]

  

137

  

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.

 

	
RADNET MANAGEMENT, INC.

	  
	
By:

	
/s/ Howard G. Berger, M.D. 

	  	
Name: Howard G. Berger, M.D. 

	  	
Title:   President

	  	  
	
RADNET, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.

	  	
Name: Howard G. Berger, M.D.

	  	
Title:   President

	  	  
	
BEVERLY RADIOLOGY MEDICAL GROUP III

	  
	
By: Beverly Radiology Medical Group, Inc., its general

partner

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name: Howard G. Berger, M.D. 

	  	
Title:   President

	  	  
	
By: Breastlink Medical Group, Inc., its general partner

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name:  Howard G. Berger, M.D.

	  	
Title:   President

	  	  
	
By: ProNet Imaging Medical Group, Inc., its general partner

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name:  Howard G. Berger, M.D.

	  	
Title:   Co-President

Credit and Guaranty Agreement

  

 

  

	
ADVANCED IMAGING PARTNERS, INC.

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name:  Howard G. Berger, M.D.

	  	
Title:   President

	  	  
	
BEVERLY RADIOLOGY MEDICAL GROUP, INC.

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name: Howard G. Berger, M.D.

	  	
Title:   President

	  	  
	
BREASTLINK MEDICAL GROUP, INC.

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name:  Howard G. Berger, M.D.

	  	
Title:   President

	  	  
	
COMMUNITY IMAGING PARTNERS, INC.

	  	  
	
By:

	

/s/ Howard G. Berger, M.D.

	  	
Name:  Howard G. Berger, M.D.

	  	
Title:   President

 

	
DELAWARE IMAGING PARTNERS, INC.

	  	  
	
By: 

	

/s/ Howard G. Berger, M.D.

	  	
Name: Howard G. Berger, M.D.

	  	
Title:   President

	
DIAGNOSTIC IMAGING SERVICES, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.

	  	
Title:   Chief Financial Officer

Credit and Guaranty Agreement

  

 

  

 

	
FRI, INC.

	  	  
	
By: 

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.

	  	
Title:   President

	  	  
	
FRI II, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

 

	
IDE IMAGING PARTNERS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D. 

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
MID ROCKLAND IMAGING PARTNERS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

 

	
NEW JERSEY IMAGING PARTNERS, INC.

	  	  
	
By: 

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	
PACIFIC IMAGING PARTNERS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

 

Credit and Guaranty Agreement

 

  

 

  

	
PRONET IMAGING MEDICAL GROUP, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.   

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   Co-President

	  	  
	
QUESTAR IMAGING, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
QUESTAR LOS ALAMITOS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

 

	
QUESTAR VICTORVILLE, INC.

	  	  
	
By: 

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	
RADIOLOGIX, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

Credit and Guaranty Agreement

  

 

  

	
RADIOLOGY AND NUCLEAR MEDICINE IMAGING

PARTNERS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
RADNET MANAGED IMAGING SERVICES, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
RADNET MANAGEMENT I, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
RADNET MANAGEMENT II, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
RADNET SUB, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

Credit and Guaranty Agreement

  

 

  

	
ROLLING OAKS IMAGING CORPORATION

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
ROLLING OAKS RADIOLOGY, INC.

	  	  
	
By: 

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	
SO CAL MR SITE MANAGEMENT, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
TREASURE COAST IMAGING PARTNERS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

	  	  
	
VALLEY IMAGING PARTNERS, INC.

	  	  
	
By:

	
/s/ Howard G. Berger, M.D.  

	  	
Name: Howard G. Berger, M.D.  

	  	
Title:   President

Credit and Guaranty Agreement

  

 

  

 

	  	
BARCLAYS BANK PLC,

	  	
as Administrative Agent, Collateral Agent, Swing Line

Lender, Issuing Bank and a Lender

	  	  	  
	  	
By:

	
/s/ John Skrobe

	  	  	
Name:  John Skrobe

	  	  	
Title:    Managing Director

 

Credit and Guaranty Agreement

  

 

  

	  	
DEUTSCHE BANK SECURITIES INC., as

Co-Syndication Agent

	  	  	  
	  	
By:

	
/s/ Nikko Hayes

	  	  	
Name:  Nikko Hayes

	  	  	
Title:    Managing Director

	  	  	  
	  	
By:

	

/s/ Ryan Morris

	 	 	
Name:  Ryan Morris

	  	  	
Title:    Director

	  	  	  
	  	
DEUTSCHE BANK TRUST COMPANY AMERICAS,

as Lender

	  	  	  
	  	
By:

	
/s/ Erin Morrissey

	  	  	
Name:  Erin Morrissey

	  	  	
Title:    Vice President

	  	  	  
	  	
By:

	
/s/ Scottye Lindsey

	  	  	
Name:  Scottye Lindsey

	  	  	
Title:    Director

 

Credit and Guaranty Agreement

 

  

 

  

	  	
GENERAL ELECTRIC CAPITAL CORPORATION, as

Co-Syndication Agent and a Lender

	  	  	  
	  	
By:

	
/s/ Andrew D. Moore

	  	  	
Name: Andrew D. Moore

	  	  	
Title:   Duly Authorized Signatory

 

Credit and Guaranty Agreement

 

  

 

  

	  	
ROYAL BANK OF CANADA, as Lender

	  	  	  
	  	
By:

	
/s/ Mustafa S. Toplwalla

	  	  	
Name: Mustafa S. Toplwalla

	  	  	
Title:   Authorized Signatory

 

Credit and Guaranty Agreement

 

  

 

  

	  	
JEFFERIES FINANCE LLC, as Lender

	  	  	  
	  	
By:

	
/s/ Carl A. Toriello

	  	  	
Name: Carl A. Toriello

	  	  	
Title:   Chief Operating Officer

 

Credit and Guaranty Agreement

 

  

 

  

SCHEDULE 1.01(a)

TO CREDIT AND GUARANTY AGREEMENT

Tranche B Term Loan Commitments

 

	
 

Lender

	 	
Initial

Term Loan Commitment

	 	 	
Pro

Rata Share

	 
	
Barclays Bank PLC

	 	
$

	285,000,000	 	 	 	100.0	%
	
Total

	 	
$

	285,000,000.00	 	 	 	100	%

 

SCHEDULE 1.01(a)-1

 

  

 

  

SCHEDULE 1.01(b)

TO CREDIT AND GUARANTY AGREEMENT

Revolving Commitments

 

	
Lender

	 	
Revolving Commitment

	 	 	
Pro Rata Share

	 
	
Barclays Bank PLC

	 	
$

	23,750,000.00	 	 	 	23.75	%
	
Deutsche Bank Trust Company Americas

	 	
$

	23,750,000.00	 	 	 	23.75	%
	
General Electric Capital Corporation

	 	
$

	23,750,000.00	 	 	 	23.75	%
	
Royal Bank of Canada

	 	
$

	23,750,000.00	 	 	 	23.75	%
	
Jefferies Finance LLC

	 	
$

	5,000,000.00	 	 	 	5.00	%
	
Total

	 	
$

	100,000,000.00	 	 	 	100	%

 

SCHEDULE 1.01(b)-1

 

  

 

  

SCHEDULE 1.01(c)

TO CREDIT AND GUARANTY AGREEMENT

RADNET MANAGEMENT, INC.

1510 Cotner Avenue

Los Angeles, CA 90025

Attention: Dr. Howard Berger,

President and Chief Executive Officer

Facsimile: (310) 445-2980

RADNET, INC. AND EACH OTHER LOAN PARTY

1510 Cotner Avenue

Los Angeles, CA 90025

Attention: Dr. Howard Berger,

President and Chief Executive Officer

Facsimile: (310) 445-2980

in each case, with a copy to:

Radnet, Inc.

1510 Cotner Avenue

Los Angeles, CA 90025

Attention: Jeff Linden, General Counsel

Facsimile: (310) 445-2980

 

SCHEDULE 1.01(c)-1

 

  

 

  

BARCLAYS BANK PLC,

as Administrative Agent, Collateral Agent,

Swing Line Lender, Issuing Bank and a Lender:

Barclays Bank PLC

745 Seventh Ave.

New York, NY 10019

Attention: Noam Azachi

Facsimile: 212-526-5115

Telephone: 212-526-1957

Email: noam.azachi@barcap.com

 with a copy to:

Barclays Capital

70 Hudson Street

Jersey City, NJ 07302

Attention: Patrick Kemer

Facsimile:  917-522-0569

Telephone:  201-499-5040

Email:  xrausloanops5@barclayscapital.com

DEUTSCHE BANK TRUST COMPANY AMERICAS,

as a Lender:

Deutsche Bank Trust Company Americas

5022 Gate Parkway Suite 200

Jacksonville, FL  32256

Attention: Judeann Milstead

Judeann.Milstead@db.com

Facsimile: 732-380-3355

with a copy to:

Agency.Transactions@db.com

Facsimile: 732-380-3355

GENERAL ELECTRIC CAPITAL CORPORATION,

as a Lender:

General Electric Capital Corporation

Two Bethesda Metro Center, Suite 600

Bethesda, MD 20814

Attention: Radnet Account Manager

Facsimile: 866-253-0078

 

SCHEDULE 1.01(c)-2

 

  

 

  

with a copy to:

General Electric Capital Corporation

Two Bethesda Metro Center, Suite 600

Bethesda, MD 20814

Attention: General Counsel

Facsimile: 301-664-9866

ROYAL BANK OF CANADA,

as a Lender:

Royal Bank of Canada – Global Loans Administration

One Liberty Plaza, 3rd Floor

165 Broadway, New York, NY 10006

Attention: Manager, Loans Administration

Facsimile: 212-428-2372

Telephone: 416-974-0388

with a copy to:

Healthcare Corporate Banking

3 World Financial Center

200 Vesey Street

New York, NY 10281

Attention: Mustafa Topiwalla

Facsimile: 212-428-6460

Telephone: 212-428-6261

JEFFERIES FINANCE LLC,

as a Lender:

Jefferies Finance LLC

520 Madison Avenue, 16th Floor

New York, New York 10022

Attention:  E. Joseph Hess

Facsimile:  212-284-3444

Telephone:  212-284-8186

with a copy to:

Jefferies Finance LLC

520 Madison Avenue, 16th Floor

New York, New York 10022

Attention:  Daniel Duval

Facsimile:  212-284-3444

Telephone:  212-708-2748

 

SCHEDULE 1.01(c)-3

 

  

  

  

 

SCHEDULE 4.01

 

 

JURISDICTIONS OF ORGANIZATION AND QUALIFICATION

 

 

	
Loan Party

	
Jurisdiction of Organization

	
RadNet, Inc.

	
Delaware

	
Diagnostic Imaging Services, Inc.

	
Delaware

	
Radnet Management, Inc.

	
California

	
Beverly Radiology Medical Group, Inc.

	
California

	
Breastlink Medical Group, Inc.

	
California

	
ProNet Imaging Medical Group, Inc.

	
California

	
Radnet Sub, Inc.

	
California

	
SoCal MR Site Management, Inc.

	
California

	
Radnet Management I, Inc.

	
California

	
Radnet Management II, Inc.

	
California

	
Radnet Managed Imaging Services, Inc.

	
California

	
Beverly Radiology Medical Group, III

	
California

	
FRI, Inc.

	
California

	
FRI II, Inc.

	
California

	
Pacific Imaging Partners, Inc.

	
California

	
Valley Imaging Partners, Inc.

	
California

	
Questar Los Alamitos, Inc.

	
Florida

	
Questar Victorville, Inc.

	
Florida

	
Rolling Oaks Imaging Corporation

	
California

	
Rolling Oaks Radiology, Inc.

	
California

	  	  

 

Each Loan Party listed above is qualified to do business in California.

 

	
Loan Party

	
Jurisdiction of Organization

	
Jurisdictions of Qualification

	
Radiologix, Inc.

	
Delaware

	
Delaware, Texas, Kansas, California

	
Advanced Imaging Partners, Inc

	
Delaware

	
Delaware, Maryland

	
Ide Imaging Partners, Inc.

	
Delaware

	
Delaware, New York

	
Mid Rockland Imaging Partners, Inc.

	
Delaware

	
Delaware, New York

	
Questar Imaging, Inc.

	
Florida

	
Florida

	
Treasure Coast Imaging Partners, Inc.

	
Delaware

	
Delaware, Florida

	
Community Imaging Partners, Inc.

	
Delaware

	
Delaware, Maryland

	
Radiology and Nuclear Medicine Imaging Partners, Inc.

	
Delaware

	
Delaware, Kansas

	
New Jersey Imaging Partners, Inc.

	
New Jersey

	
New Jersey

	
Delaware Imaging Partners, Inc.

	
Delaware

	
Delaware

 

 

 

  

  

  

 

 

SCHEDULE 4.02

 

EQUITY INTEREST AND OWNERSHIP

 

 

	
Name of Issuer

	
Authorized

	
Issued

	   	
Holder

	
RadNet, Inc. (“Holdings”)

	
Common Stock $.0001 par value

	
36,259,279

	 	
Publicly Held

	  	
200,000,000 shares

Preferred Stock

30,000,000 shares

	
0

	 	
N/A

	
Radnet Management, Inc.

(“Borrower”)

	
Common Stock

$.01 par value

10,000 shares

	
1,000

	 	
Holdings (100%)

	
Beverly Radiology Medical Group, Inc.

(“BRMG”)

	
100,000

No par value

	
10,000

	 	
Dr. Berger (90%)

Dr. Crues  (10%)

	
Breastlink Medical Group, Inc.

(“BMG”)

	
100,000

No par value

	
5,000

	 	
Dr. Berger (100%)

	
ProNet Imaging Medical Group, Inc.

(“PIMG”)

	
100,000

No par value

	
10,000

	 	
Dr. Berger (90%)

Dr. Crues (10%)

	
Beverly Radiology Medical Group, III

	
N/A

	
N/A

	 	
Held 1/3 each by BRMG, BMG and PIMG

	
Diagnostic Imaging Services, Inc.

	
Common Stock

$.0001 par value

10,000 shares

	
5,732

	 	
Borrower (100%)

	
Radnet Sub, Inc.

	
100,000 shares

No par value

	
1,000

  	 	
Borrower (100%)

	
SoCal MR Site Management, Inc.

	
Common Stock

$.01 par value

5,000,000 shares

	
10,000

	 	
Borrower (100%)

	
Radnet Management I, Inc.

	
1,000,000

No par value

	
10,000

	 	
Borrower (100%)

	
Radnet Management II, Inc.

	
1,000,000 No

par value

	
10,000

	 	
Borrower (100%)

	
Radnet Managed Imaging Services, Inc.

	
1,000,000

No par value

	
1,000

	 	
Borrower (100%)

 

 

 

  

  

  

 

SCHEDULE 4.02

 

(continued)

 

 

 

	
Name

	
Authorized

	
Issued

	
Holder

	
FRI, Inc.

	
100,000

	
10,000

	
Borrower (100%)

	  	
No par value

	  	  
	
FRI II, Inc.

	
100,000

	
10,000

	
Borrower (100%)

	  	
No par value

	  	  
	
Delaware Imaging Partners, Inc.

	
Common Stock

	
100

	
Borrower (100%)

	  	
.0001 par value

	  	  
	  	
100,000 shares

	  	  
	
New Jersey Imaging Partners, Inc.

	
100,000

	
100

	
Borrower (100%)

	  	
No par value

	  	  
	
Rolling Oaks Imaging Corporation

	
10,000

	
9,000

	
Borrower (100%)

	  	
No par value

	  	  
	
Rolling Oaks Radiology, Inc.

	
20,000

	
12,996

	
Borrower (100%)

	  	
No par value

	  	  
	
Radiologix, Inc.

	
Common Stock

	
100

	
Borrower (100%)

	
(“Radiologix”)

	
$.01 par value

	  	  
	  	
3,000 shares

	  	  
	
Advanced Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
$0.001 par value

	  	  
	  	
1,000 shares

	  	  
	
Ide Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
$0.001 par value

	  	  
	  	
1,000 shares

	  	  
	
Mid Rockland Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
$0.001 par value

	  	  
	  	
1,000 shares

	  	  
	
Pacific Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
No par value

	  	  
	  	
1,000 shares

	  	  
	
Questar Imaging, Inc.

	
Common Stock

	
3,000

	
Radiologix (100%)

	
(“Questar Imaging”)

	
$1.00 par value

	  	  
	  	
7,000 shares

	  	  

 

 

 

  

  

  

 

SCHEDULE 4.02

 

(continued)

 

	
Name

	
Authorized

	
Issued

	
Holder

	
Treasure Coast Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
$0.001 par value

	  	  
	  	
1,000 shares

	  	  
	
Community Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
$0.001 par value

	  	  
	  	
1,000 shares

	  	  
	
Radiology and Nuclear Medicine

	
Common Stock

	
100

	
Radiologix (100%)

	
Imaging Partners, Inc.

	
$0.001 par value

	  	  
	  	
1,000 shares

	  	  
	
Valley Imaging Partners, Inc.

	
Common Stock

	
100

	
Radiologix (100%)

	  	
No par value

	  	  
	  	
1,000 shares

	  	  
	
Questar Los Alamitos, Inc.

	
Common Stock

	
100

	
Questar Imaging

	  	
$1.00 par value

	  	
(100%)

	  	
1,000 shares

	  	  
	
Questar Victorville, Inc.

	
Common Stock

	
100

	
Questar Imaging

	  	
$1.00 par value

	  	
(100%)

	  	
1,000 shares

	  	  

 

There are no subscriptions, options, warrants or calls relating to any shares of Holdings or any Loan Party’s capital stock, including any right of conversion or exchange under any outstanding security or other instrument except as to Holdings, Options issued to employees, directors and consultants to purchase common shares (3,959,750), and Warrants issued to employees and some business entities related to Holdings to purchase common shares (3,057,898) for an aggregate of 7,017,648

 

 

  

  

  

 

 

 

SCHEDULE 4.13

 

REAL ESTATE ASSETS

 

New Jersey Imaging Partners, Inc. owns Real Estate Assets located at 2770 Morris Ave., Union, NJ. Attached hereto is a list of all locations at which real estate is leased.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

  

  

 

Radnet Site Locations                                           03/26/2010

 

	
CALIFORNIA - SOUTHERN

	
Breastlink - The Breast Care and

Imaging Center of Orange County

230 South Main St., #100&#205

Orange, CA 92868-3851

	
Desert Advanced Imaging -

Bermuda Dunes

41-120 Washington Blvd. JFK Med

Bldg, 2nd Floor

Bermuda Dunes, CA 92203-9215

	
Encino Breast Care Center, The

5363 Balboa Blvd., #100

Encino, CA 91316-2805

	
Alamo Advanced Imaging Center

3655 Alamo St., #101

Simi Valley, CA 93063-2187

	
Breastlink of Temecula

25395 Hancock Ave., #230

Murrieta, CA 92562-9054

	
Desert Advanced Imaging - Indio

81-880 Dr. Carreon Blvd., #A-102

Indio, CA 92201-5559

	
Film Library-Medical Records

12619 Daphne Ave.

Hawthorne, CA 90250-3309

	
Anaheim Advanced Imaging

947 South Anaheim Blvd., #100

Anaheim, CA 92805-5582

	
Burbank Advanced ICMG X-Ray

3808 Riverside Drive, #120

Burbank, CA 91505-4339

	
Desert Advanced Imaging - Palm

Desert

72855 Fred Waring Drive

Palm Desert, CA 92260-9367

	
Grove Diagnostic Imaging

8283 Grove Ave., #101

Rancho Cucamonga, CA 91730-3138

	
A(ntelope) V MRI Medical Clinic

43713 N. 20th St. West #6

Lancaster, CA 93534-4626

	
Burbank Advanced Imaging

Center MG

10101 Riverside Drive

Toluca Lake, CA 91602-2517

	
Desert Advanced Imaging - Palm

Springs

2601 E. Tahquitz Canyon Way

Palm Springs, CA 92262-7015

	
Grove Diagnostic Imaging - Haven

8599 Haven Ave., #101

Rancho Cucamonga, CA 91730-4849

	
Beverly Tower Wilshire Advanced

Imaging Center

8750 Wilshire Blvd., #100

Beverly Hills, CA 90211-5001

	
Camarillo Imaging Center

3901 Las Posas Rd., #104

Camarillo, CA 93010-1505

	
Desert Advanced Imaging - Palm

Springs/El Cielo

275 N El Cielo, #B1

Palm Springs, CA 92262-6955

	
Grove Diagnostic Imaging Center -

Grove Annex

8263 Grove Ave., #102

Rancho Cucamonga, CA 91730-3107

	
Beverly Tower Women's Center

465 N. Roxbury Drive #101

Beverly Hills, CA 90210-4206

	
Corona Advanced Imaging

175 E. 9th St.

Corona, CA 92879-3144

	
Desert, Breast Care Center of the

35-800 Bob Hope Dr., #150B

Rancho Mirage, CA 92270-1722

	
HealthCare Imaging - Moreno

Valley

11441 Heacock Ave., #E

Moreno Valley , CA 92557-7907

	
Breastlink - Manhattan Beach

14650 Aviation Blvd., #200

Hawthorne, CA 90250-6670

	
Corona Advanced Imaging

MRI/CT

886 Magnolia Ave., #101

Corona, CA 92879-3105

	
Elite Advanced Imaging

17260 Bear Valley Rd., #109

Victorville, CA 92395-7754

	
HealthCare Imaging Center

4334 Central Avenue

Riverside, CA 92506-2918

 

 

 

 

  

  

  

 

Radnet Site Locations                                           03/26/2010

 

	
HealthCare Imaging Center -

Citrus

6848 Magnolia Ave., #129

Riverside, CA 92506-2899

	
Los Coyotes Imaging Center

3320 Los Coyotes Diagonal #112 &

120

Long Beach, CA 90808-3918

	
OIMC Anaheim X-Ray

6200 East Canyon Rim Rd., #107C

Anaheim Hills, CA 92807-4313

	
Rolling Oaks Radiology - West

375 Rolling Oaks Dr., #150

Thousand Oaks, CA 91361-1031

	
InSight Film Library

430 W. Redondo Beach Blvd.

Gardena, CA 90248-2104

	
Los Coyotes Imaging Center -

Atlantic

2699 Atlantic Ave.

Long Beach, CA 90806-2710

	
Orange Advanced Imaging Center

230 South Main St., #101

Orange, CA 92868-3851

	
Rolling Oaks Radiology Women's Center

415 Rolling Oaks Dr., #160

Thousand Oaks, CA 91361-1038

	
Irvine Advanced Imaging

35 Creek Rd.

Irvine, CA 92604-4724

	
Los Coyotes Imaging Center -

Spring

6226 E. Spring St., #270

Long Beach, CA 90815-1423

	
Orange Imaging Medical Center

293 South Main St.

Orange, CA 92868-3806

	
San Fernando Valley Advanced Imaging Center

6855 Noble Ave.

Van Nuys, CA 91405-3729

	
Lakewood Open MRI

3715 East South St.

Long Beach, CA 90805-4521

	
Los Coyotes Imaging Center -

Women's Center

3320 Los Coyotes Diagonal #260

Long Beach, CA 90808-3918

	
Oxnard Imaging Center

1150 North Ventura Rd.

Oxnard, CA 93030-3837

	
San Fernando Valley

Interventional Radiology and Imaging Center

16311 Ventura Blvd.,

#120 Encino, CA 91436-2124

	
Lancaster Imaging Med Grp

44725 10th Street West #150 & #180

Lancaster, CA 93534-3000

	
Main Street Imaging

222 East Main St., #214

Barstow, CA 92311-2842

	
Rancho Mirage Interventional

Radiology and Imaging Center

35-800 Bob Hope Dr., #150A

Rancho Mirage, CA 92270-1722

	
Santa Clarita Imaging

24355 Lyons Ave., #150

Santa Clarita, CA 91321-2379

	
Liberty Pacific Advanced Imaging

16130 Ventura Blvd., #100

Encino, CA 91436-2503

	
Northridge Diagnostic Center MG

8227 Reseda Blvd.

Reseda, CA 91335-1247

	
Redondo Imaging Center MG

2600 Redondo Ave.

Long Beach, CA 90806-2325

	
Santa Clarita Imaging - MRI

25775 W. McBean Pkw., #100

Valencia, CA 91355-3702

	
Los Alamitos OpenScan MRI

4281 Katella Ave., #103

Los Alamitos, CA 90720-3585

	
Northridge Diagnostic MG X-ray

8327 Reseda Blvd.

Northridge, CA 91324-4620

	
Rolling Oaks Radiology

415 Rolling Oaks Dr., #125

Thousand Oaks, CA 91361-1038

	
Santa Clarita Imaging - X-ray

27141 Hideaway Ave., #103

Canyon County, CA 91321-2453

 

 

 

  

  

  

 

Radnet Site Locations                                           03/26/2010

 

	
Simi Valley Advanced Medical

Imaging

1687 Erringer Rd., #210

Simi Valley, CA 93065-6508

	
Thousand Oaks MDI - Jensen Ct

110 Jensen Court, # IA

Thousand Oaks, CA 91360-7484

	
Westlake X-RAY

1240 Westlake Blvd., #111

 Westlake Village, CA 91361-1976

	
NorCal Imaging - Concord

2300 Clayon Rd., #160

Concord. CA 94520-2100

	
Temecula Advanced Imaging -

Hancock

25395 Hancock Ave., #110

Murrieta, CA 92562-9054

	
Thousand Oaks MDI - Lombard

300 Lombard St.

Thousand Oaks, CA 91360-5808

	
CALIFORNIA - NORTHERN

	
NorCal Imaging - Fremont

2201 Walnut Ave., #150

Fremont, CA 94538-2334

	
Temecula Valley Imaging -

Jefferson

27699 Jefferson Ave., #110

Temecula, CA 92591-2697

	
Ventura Coast Imaging Center &

VCIC Women's Center

4601 Telephone Rd., #102 & 107

Ventura, CA 93003-5670

	
Diagnostic Radiological Imaging

Medical Group

79 Scripps Dr., #100

Sacramento, CA 95825-6208

	
NorCal Imaging - Oakland

3200 Telegraph Avenue

Oakland, CA 94609-3016

	
Temecula Valley Imaging - Sun

City

26926 Cherry Hills Blvd., #A

Sun City, CA 92586-5504

	
Victor Valley Adv. Img.-Corwin

18523 Corwin Rd.

Apple Valley, CA 92307-2338

	
Emeryville Advanced Imaging

Center

6121 Hollis St., #1

Emeryville, CA 94608-2078

	
NorCal Imaging - Pleasanton

5924 Stoneridge Dr., #105&#106

Pleasanton, CA 94588-2704

	
Temecula Valley Imaging -

Wildomar

36320 Inland Valley Dr., #303

Wildomar, CA 92595-9547

	
Victor Valley Adv. Img.-Hesperia

12677 Hesperia Rd., #190

Victorville, CA 92395-7735

	
Fresno Imaging Center

6191 N. Thesta Avenue

Fresno, CA 93710-5266

	
NorCal Imaging - San Leandro

2450 Washington Ave. #120

San Leandro, CA 94577-5996

	
Temecula Valley Imaging Center -

Single Oak

28780 Single Oak Dr., #155

Temecula, CA 92590-3625

	
Victor Valley Adv. Img.-Open

Scan MRI

12276 Hesperia Rd., #6

Victorville, CA 92395-5838

	
Modesto Advanced Imaging

Center - Patterson

1108 Ward Ave., Bldg. A, #1

Patterson, CA 95363-8529

	
NorCal Imaging - Walnut Creek

114 La Casa Via, #100 & #200

Walnut Creek, CA 94598-3087

	
Temecula Valley, The Breast Care

Center of

25395 Hancock Ave., #200

Murrieta, CA 92562-9054

	
Westchester Adv. Imaging MG

8540 S. Sepulveda Blvd., #111

Los Angeles, CA 90045-3807

	
Modesto Advanced Imaging

Center

157 E. Coolidge Ave.

Modesto, CA 95350-4504

	
NorCal Open MRI of Walnut Creek

710 S. Broadway St., #203

Walnut Creek, CA 94596-5294

 

 

 

  

  

  

 

Radnet Site Locations                                           03/26/2010

 

 

	
Pittsburg Open MRI

1441 E. Leland Rd., #D&#E

Pittsburg, CA 94565-5100

	
Valley Imaging Partners - Brewster

801 Brewster Ave., #100

Redwood City, CA 94063-1557

	
DELAWARE

	
PAMI - Polly Drumond

40 Polly Drummond Hill Rd.,

Bldg 4 Newark , DE 19711-5703

	
Radnet Medical Imaging - San Francisco

3440 California St.

San Francisco, CA 94118-1837

	
Valley Imaging Partners - Ciro

125 Ciro Ave., #220 & #230

San Jose, CA 95128-9179

	
PAMI - Augustine Cut Off 1701 Augustine Cut Off Bldg.4 Wilmington , DE 19803-4462

	
PAMI - Silverside

2700 Silverside Rd.

Wilmington , DE 19810-3718

	
Santa Rosa Imaging Med Center

3536 Mendocino Ave., #280 Santa Rosa, CA 95403-3634

	
Valley Imaging Partners - Los Gatos

555 Knowles Dr., #116

Los Gatos, CA 95032-1549

	
PAMI - Glasgow

2600 Glasgow Ave #122

Newark, DE 19702-4777

	
FLORIDA

	
Stockton Diagnostic Imaging

2800 North California St., #4 & #6

Stockton, CA 95204-3757

	
Valley Imaging Partners - Montpelier

2385 Montpelier Drive

San Jose, CA 95116-1614

	
PAMI - Glasgow

Med Aid unit 

600 Glasgow Ave. #100

Newark, DE 19702-4777

	
Radiology Imaging Associates - Fort Pierce

2306 Nebraska Ave.

Fort Pierce, FL 34950-4824

	
Stockton Diagnostic Imaging - March Lane

1801 E. March Lane, #A-130

Stockton, CA 95210-6650

	
Valley Imaging Partners -

Mountain View

285 South Dr., #5

Mountain View, CA 94040-4313

	
PAMI - Lewes

33672 Bayview Medical Dr Lewes,

DE 19958-1687

	
Radiology Imaging Associates - Port St. Lucie

1825 Southeast Tiffany Ave., #104 

ort St. Lucie, FL 34952-7554

	
Vacaville Imaging

600 Nut Tree Rd., #110

Vacaville, CA 95687-4556

	
Valley Imaging Partners - MRI Imaging of San Mateo

35 Baywood Ave., #2

San Mateo, CA 94402-1516

	
PAMI-Middletown

120 Sandhill Dr., #2

Middletown, DE 19709-5806

	
Radiology Imaging Associates - Stuart

835 Southeast Osceola St.

Stuart, FL 34994-2431

	
Vallejo Open MRI

155 Glen Cove Marina Rd., #101

Vallejo, CA 94591-7284

	
Valley Imaging Partners -

Samaritan

2581 Samaritan Dr., #100 & #206

San Jose, CA 95124-4112

	
PAMI - NeuroScience Imaging

774 Christiana Rd., #B

Newark, DE 19713-4235

	  

 

 

 

 

 

  

  

  

 

 

Radnet Site Locations                                           03/26/2010

 

	
KANSAS

	
Advanced Radiology - Arundel Mills

7556 Teague Rd., #200

Hanover, MD 21076-1200

	
Advanced Radiology - Harford

104 Plumtree Rd., #106

Bel Air, MD 21015-8979

 	
Advanced Radiology - Owings Mills

2 Park Center Court, #A

Owings Mills, MD 21117

	
MRI Center of Kansas

731 SW Mulvane St.

Topeka, KS 66606-1665

	
Advanced Radiology - Bellona

8322 Bellona Ave., #390

Towson, MD 21204

	
Advanced Radiology - Imaging

Center, Richard N. Dixon Building

291 Stoner Ave., #200

Westminster, MD 21157-5659

	
Advanced Radiology - Perry Hall

4211 Blakely Ave., #100

Baltimore, MD 21236-2456

	
The Imaging Center by Radiology

and Nuclear Medicine

823 SW Mulvane, #1

Topeka, KS 66606-1764

	
Advanced Radiology - Crain Towers

1600 Crain Highway, #101 & #301

Glen Burnie, MD 21061-5577

	
Advanced Radiology - Lutherville

1209 York Rd., Suite 100

Lutherville, MD 21093-6207

	
Advanced Radiology - Physicians Pavilion North at Greater

Baltimore Medical Center

6535 North Charles St., #100

Baltimore, MD 21204-5826

	
MARYLAND

	
Advanced Radiology - Crossroads

4801 Dorsey Hall Dr., #101

Ellicott City, MD 21042-7703

 	
Advanced Radiology - Medical

Arts Building

9101 Franklin Square Dr., #102

Baltimore, MD 21237-3936

 	
Advanced Radiology - Pomona Square

1700 Reisterstown Rd., #112

Baltimore, MD 21208-2935

	
Advanced Radiology - Advanced

PET Imaging of Maryland/Open

MRI Pomona

1700 Reisterstown Rd., #119

Baltimore, MD 21208-2935

	
Advanced Radiology - Eldersburg

1430 Progress Way, #108

Eldersburg, MD 21784-6498

	
Advanced Radiology - Merritt

Blvd.

1576 Merritt Blvd., #1

Baltimore, MD 21222-2114

	
Advanced Radiology - The Breast Center at St. Joseph Medical Center

7501 Osler Dr.., #205

Towson, MD 21204-7743

	
Advanced Radiology - Aiello

Center at Baltimore Washington

Medical Center

203 Hospital Dr. #100

Glen Burnie, MD 21061-5863

	
Advanced Radiology - Ellicott

Open MRI

3570 Sanit John Lane #104B

Ellicott City, MD 21042-4020

	
Advanced Radiology - MRI at St.

Joseph Medical Center

124 Sister Pierre Drive

Baltimore, MD 21204-7507

	
Advanced Radiology - The Cancer Institute at St. Joseph Medical Center

7501 Osler Dr., #G03, Bldg. A

Towson, MD 21204-7743

	
Advanced Radiology - Annapolis

888 Bestgate Rd., #101

Annapolis, MD 21401-2950

	
Advanced Radiology - GBMC

(Greater Baltimore Medical

Center) Pavilion

6701 North Charles St., #3103

Baltimore, MD 21204-6808

	
Advanced Radiology - O'Dea

7505 Osler Dr., #406

Baltimore, MD 21204-7739

	
Advanced Radiology - The PET

Center at Baltimore Washington Medical Center

305 Hospital Dr., #302

Glen Burnie, MD 21061-5862

 

 

 

 

 

 

  

  

  

 

Radnet Site Locations                                           03/26/2010

 

 

	
Advanced Radiology - White

Square

9105 Franklin Square Dr., #102

Baltimore, MD 21237-3936

	
CRA - Greenbelt Imaging Center

7501 Greenway Center Dr., #200

Greenbelt, MD 20770-3530

	
NEW JERSEY

	
Diagnostic Radiology Associates of

Wayne

1350 Route 23 North

Wayne, NJ 07470-5839

	
CRA - Bethesda Imaging Center

10215 Fernwood Rd., #620

Bethesda, MD 20817-1184

	
CRA - Leisure World Imaging

Center

3801 International Dr., #103

Silver Spring, MD 20906-1550

	
Diagnostic Radiology Associates of

Clifton

1339 Broad St.

Clifton, NJ 07013-4219

	
Union Imaging Center

445 Chestnut St.

Union, NJ 07083-9305

	
CRA - Bowie Radiology

14999 Health Center Dr., #102

Bowie, MD 20716-1075

	
CRA - Montgomery Community

MRI

18103 Prince Philip Drive

Olney, MD 20832-1514

	
Diagnostic Radiology Associates of

Cranford

25 South Union Ave.

Cranford, NJ 07016-2843

	
NEW YORK

	
CRA - Clinton Imaging Center

9131 Piscataway Rd., #110 & #310

Clinton, MD 20735-2543

	
CRA - Olney Imaging Center

18111 Prince Philip Dr., #T-20

Olney, MD 20832-1522

	
Diagnostic Radiology Associates of

Hackensack

433 Hackensack Ave., Continental

Plaza.

Hackensack, NJ 07601-6319

	
Borg & Ide Imaging - Ayrault

800 Ayrault Rd.

Fairport, NY 14450-8941

	
CRA - Frederick Imaging Center

67 Thomas Johnson Dr., #4

Frederick, MD 21702-4862

	
CRA - Rockville Imaging Center

15200 Shady Grove Rd., #101

Rockville, MD 20850-3218

	
Diagnostic Radiology Associates of

Morris-Sussex

121 Center Grove Rd., #7

Randolph, NJ 07869-4453

	
Borg & Ide Imaging - Clinton

Crossings

995 Senator Keating Blvd., #100

Rochester, NY 14618-2777

	
CRA - Frederick North

46B Thomas Johnson Dr., #100

Frederick, MD 21702-4501

	
CRA - White Oak Imaging Center

11120 New Hampshire Ave.,

#100&#105

Silver Spring, MD 20904-2633

	
Diagnostic Radiology Associates of

Morristown

355 Madison Ave. (The Abbey)

Morristown, NJ 07960-6900

	
Borg & Ide Imaging - Culver

Medical Park

2619 Culver Rd.

Rochester, NY 14609-1746

	
CRA - Germantown Imaging

Center

20528 Boland Farm Rd., #110

Germantown, MD 20876-4032

	  	
Diagnostic Radiology Associates of

Northfield

772 Northfield Ave.

West Orange, NJ 07052-1100

	
Borg & Ide Imaging - Erie Canal

120 Erie Canal Dr. #160

Rochester, NY 14626-4607

 

 

 

  

  

  

 

Radnet Site Locations                                           03/26/2010

 

	
Borg & Ide Imaging -

F.F.Thompson Professional

Building

360 Parish St. (Ground Level)

Canandaigua, NY 14424-1789

	
Borg & Ide Imaging - Stone Road

1401 Stone Rd., #102

Rochester, NY 14615-1537

	
Hudson Valley Radiology

Associates of Westchester -

Tuckahoe

115 Main St.

Tuckahoe, NY 10707-2911

	
CRA (Community)

4110 Aspen Hill Rd., #200

Rockville, MD 20858

	
Borg & Ide Imaging - Lattimore

125 Lattimore Rd., #30

Rochester, NY 14620-4159

	
Borg & Ide Imaging - White

Spruce

200 White Spruce Blvd.

Rochester, NY 14623-7911

	
ADMINISTRATION OFFICES

	
Mid Rockland Imaging Associates

18 Squadron Blvd.

New City, NY 10956-5210

	
Borg & Ide Imaging - Linden Oaks

10 Hagen Dr., #10

Rochester, NY 14625-2662

	
Hudson Valley Radiology -

Hudson Valley PET Imaging -

Nyack

111 North Highland Ave.

Nyack , NY 10960-1805

	
RadNet, Inc. Radnet Management,

Inc. BRMG

1510 Cotner Avenue

Los Angeles, CA 90025-3303

	
PAMI - Delaware

1701 Augustine Cutoff, Bldg. $

Wilmington , DE 19803

	
Borg & Ide Imaging - Park Ridge

Office

1561 Long Pond Rd., #113

Rochester, NY 14626-4136

	
Hudson Valley Radiology - Mid

Rockland Img - New City

18 Squadron Boulevard

New City, NY 10956-5210

	
Advanced Radiology

7253 Ambassador Rd.

Baltimore, MD 21244-2710

	
Radiologix

2200 Ross Ave., #3600

Dallas, TX 75201-2708

	
Borg & Ide Imaging - Park Ridge

Women's Imaging

1555 Long Pond Rd.,

Rochester, NY 14626-4122

	
Hudson Valley Radiology - New

Paltz

279 Main St., #103

New Paltz, NY 12561-1624

	
Borg & IDE Imaging Partners

2263 S. Clinton Ave.

Rochester, NY 14618-2696

	
Radiology & Nuclear Medicine

Imaging Partners

1303 SW First American P1., #200

Topeka, KS 66604

	
Borg & Ide Imaging - Red Creek

400 Red Creek Drive Rd. #140

Rochester, NY 14623-4273

	
Hudson Valley Radiology - Nyack

MRI

160 North Midland Avenue

Nyack, NY 10960-1912

	
Borg & IDE Imaging Group

400 Red Creek Dr., #240

Rochester, NY 14623-4273

	
Treasure Coast Imaging Partners

1825 SE Tiffany Ave., #104

Pt. St. Lucie, FL 34952

	
Borg & Ide Imaging - Scottsville

1260 Scottsville Rd.

Rochester, NY 14624-5705

	
Hudson Valley Radiology

Associates of Inter-County

955 Yonkers Ave.

Yonkers, NY 10704-3060

	
Breastlink - Business Office

2600 Redondo Ave., #405

Long Beach, CA 90806

	
Valley Imaging Partners

3031 Tisch Way, #400

San Jose, CA 95128

 

 

  

  

  

 

SCHEDULE 4.26(a)

 

COMPLIANCE WITH HEALTH CARE LAWS AND PERMITS

 

SEE ATTACHED

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

  

  

 

 

 

 

	
Boston Brussels Chcago DUsseloorl Houston London Los Angeles Miami Milan Munieh New York Orange County Rome San Dlego Silicon Valley Washington, D.0

 

Strategic alliance wrin MWE Cl-ene Lew Offices (Shangnal)

 

	  Daniel F. Gottfieb Attorney at Law clgottliebarnwe.corn 

+1 312 g84 8471

 

 

March 2, 2010

 

VIA EXPRESS MAIL

 

Provider Enrollment Appeals P.O. Box 1508

Augusta, Georgia 30903-1508

 

Re:           Request for Reconsideration for Pronet Imaging (PTAN: W13945; NP! # 1528099488) 

 

Dear Sir/Madame:

 

We are writing on behalf of our client, Pronet Imaging Medical Group, Inc., a California corporation (the "Group"), to submit this request for reconsideration ("Reconsideration Request") of Palmetto GBA's revocation of the Group's Medicare billing privileges effective July 9, 2009. This Reconsideration Request responds to the letter, attached as Exhibit A, from Cindy Perrone, Palmetto GBA Medicare Provider Enrollment, (the "Revocation Letter"), dated September 22, 2009 (the "Denial Date"), notifying the Group of the revocation of its billing privileges. The Group has authorized us to submit this Reconsideration request on its behalf and pursuant to § 19 of Chapter 10 of the Medicare Program Integrity Manual.

 

We hereby respectfully request that Palmetto GBA restore the Group's Medicare billing privileges effective July 9, 2009 because Palmetto GBA lacked proper grounds to revoke the Group's billing privileges under 42 C.F.R. § 424.535(a)(5)(ii). As explained below, the revocation is the result of an inspector who 'incorrectly concluded that the Group was not operating a medical office at 1516 Cotner Avenue, Los Angeles, California 90025-3303 (the "Office") on July 9, 2009, without even entering the Office.

 

The following section describes the Group and other facts and circumstances relevant to this Reconsideration Request, Section II explains that Group is entitled to the restoration of its billing privileges because it has operated a medical office in accordance with applicable Medicare statutes, regulations and rules on and after November 2, 2002, including on July 9, 2009. Section III explains that the Group has "good cause" for filing this Reconsideration Request after the filing deadline set forth in the Revocation Letter.

 

I.           Background

 

The Group employs thirteen radiologists, approximately nine of which are always present at the Office, and operates a single-specialty radiology group practice at the Office. As such, the Group provides the professional component (i.e., professional interpretations) of diagnostic radiology tests through its radiologist-employees. These professional radiology services involve a

 

 

 

 

 

U.S. practice conducted through McDermott Wili dL Emory LLP

 

227 West Monroe Street Chicago. illinois 60608-5098 Telepnone: +1 312 372 2000 Facsimile: +1 312 984 7700 www.rnwe.com

 

 

 

  

  

  

 

 

Provider Enrollment Appeals Page 2

 

radiologist's interpretation of digitized diagnostic radiology test images on computer monitors and preparation of a report that summarizes the radiologist's findings and professional judgments. The radiologists do not need to meet with a patient at the Office in order to interpret the images and meet Medicare requirements for professional interpretations of diagnostic radiology tests. The patient is physically present only for the technical component of the diagnostic radiology tests, which are provided by other Medicare suppliers and not furnished by the Group.

 

According to the Revocation Letter, on July 9, 2009, a California Benefit Integrity Support Center inspector conducted an unannounced site visit at the Office address and concluded that there was no medical office at the address. According to staff present at the Office on July 9, 2009, the inspector never entered the Office that day and never observed the Group's radiologists interpreting images on the computer monitors in the Office. Instead, the inspector hastily reached the conclusion that a three-floor building with parking on the first floor could not be a medical office. The inspector's hasty and clearly erroneous conclusion caused Palmetto GBA to mistakenly revoke the Group's billing privileges pursuant to 42 C.F.R. § 424.53(a)(5)(ii).

 

In response to the Revocation Letter, Susan Roberts, the Group's Credentialing Manager, contacted Palmetto GBA Medicare Provider Enrollment ("Provider Enrollment") several times from October 20, 2009 through November 13, 2009 to discuss the Revocation Letter and the apparent error by the inspector. Ms. Roberts sought to correct the error through informal means with Provider Enrollment, but the Provider Enrollment representatives were unable to recognize that an error had been rnade and provide an answer to Ms. Roberts as to appropriate next steps for the Group.

 

On December 15, 2009, Ms. Roberts spoke with a Level 1 Provider Enrollment supervisor and requested an appeal due to the mistaken revocation and denial of the revalidation. The Level supervisor incorrectly advised that an appeal was not worth the effort because the Group does not see patients at the Office. Subsequently, Ms. Roberts spoke with a Level 2 supervisor who also advised that an appeal was not worth the effort for the same reason. Neither supervisor took the time to understand that a radiology practice provides covered diagnostic radiology professional services to Medicare patients in accordance with Medicare requirements by reviewing images. Instead, both supervisors repeated the inspector's mistaken findings that the Office was not operational and billing privileges were properly revoked pursuant to 42 C.F.R. § 424.53(a)(5)(ii).

 

Following consultation with health law counsel at our firm, the Group now submits this Reconsideration Request,

 

11.           Group's Right to the Restoration of Its Billing Privileges

 

As described above, the Group operated a radiology group practice providing professional radiology services (i.e., the professional interpretation of diagnostic radiology tests) at the Office on July 9, 2009 in accordance with applicable Medicare statutes, regulations and rules. As such, Palmetto GBA did not have a proper basis for revoking the Group's billing privileges under 42 C.F.R. § 424.535. Instead, the revocation is due to a mistake by the California Benefit Integrity. Support Center inspector who observed the outside of the Office on July 9, 2009 and incorrectly determined that the Group was not operating a medical office at the location when radiologists were, in fact, interpreting diagnostic radiology images at the Office. Accordingly, we request that Palmetto GBA restore the Group's billing privileges.

 

 

  

  

  

 

 

Provider Enrollment Appeal

 Page 3

 

 

 

III.           Good Cause For Extension of Time Limit for Reconsideration Request

 

We believe that there is "good cause" for an extension of the time limit for filing this Reconsideration Request so that a hearing officer may review this Reconsideration Request on its merits. There is "good cause" because of unusual or unavoidable circumstances in accordance with § 19 of Chapter 10 of the Medicare Program Integrity Manual. Specifically, the Group attempted to rectify through informal means with Provider Enrollment personnel the apparent mistake of the inspector who did not enter the Office to view the radiologists interpreting images. Further, the Group believed that its good-faith efforts to resolve this matter informally through Provider Enrollment and submission of the Revalidation Application extended the appeal period,

 

 

We appreciate your consideration of this Reconsideration Request and hope that you will reverse your revocation of the billing privileges. If you have questions about this Reconsideration Request, please contact me at 312-984-6471.

 

	
Sincerely,

 

/s/ Daniel F. Gottlieb

 

 

DFG/dnb Attachment

 

	
cc:

	
Susan Roberts (via e-mail)

Jeff Linden (via e-mail)

 

  

  

  

 

EXHIBIT A

 

 

 

 

 

REVOCATION LETTER

Please see attached

 

 

 

 

 

  

  

  

 

 

	  

	
 

	
Palmetto GBA.

	
PARTNERS IN E KCELLENCE.

	
NB WC Jurisdiction 1

California, Nevada, Hawaii, Guam, American Samoa, Northern Mariano Islands

 

September 22, 2009

 

Proztei Imaging

1516 Cotner Ave.

Los :Angeles, CA 90025-3303

 

Provider Transaction AoCelkS Number (PTANYProvicler kierecation Number (PLN): W13945 NPI: 1528099488

Deer Pronet Imaging:

We’ve recently been made aware of information that shows you are not in compliance with the regulations and standards for retaining your Medicare billing privileges.  Therefore, your Medicare billing number and billing privileges are being revoked effective July 9, 2009.

Your Medicare billing number is being revoked based on the following reasons(s):

Pursuant to Title 42 of the Code of Federal Regulations Section 424.535— If CMS or its contractor determines, upon an on-site review, that a provider or supplier is not longer operation to furnish Medicare covered items or services to Medicare patients, the provider or supplier billing number will be revoked.

Specifically: On July 9, 2009, California Benefit Integrity Support Center conducted an unannounced site visit at the practice address of 1516 Cotner Ave. Los Angeles, CA 90025-3303, and found this address is not that of a medical office.

Pursuant to 42 CFR 424.535(c), Palmetto GBA is establishing a re-enrollment bar for a period of 2 years.  This enrollment bar only applies to your participation in the Medicare program.  In order to re-enroll, you must meet all requirements for your provider or supplier type.

You may take steps to correct the deficiencies and reapply to establish your eligibility by submitting a corrective action plan (CAP) within 30 calendar days after the postmark date of this letter.  The CAP should provide evidence that you are in compliance with Medicare requirements.  CAP requests should be sent to:

Provider Enrollment Appeals

P.O. Box 1508

Augusta, GA 30903-1508

If you disagree with the determinations to revoke your billing number, you may request a reconsideration of the revocation.  The request for reconsideration must be in writing and must be filed within 60 days of the date you receive this notice (presumed to be 5 days after the date of the notice).  The request should be sent to:

Provider Enrollment Appeals

P.O. Box 1508

Augusta, GA 30903-15 08

 

You cannot request a reconsideration through this process for any exclusion by another Federal agency.  Any reconsideration requests involving such exclusion must be fled with the Federal agency that took the action

 

 

 

  

  

  

 

Page 2

Please remember to sign and date your reconsideration and include a copy of this notice.

You may contact our Customer Service Department at 1-866-931-3901.

Please ensure the National Plan and Provider Enumerations System (NPPES) is notified of any changes in enrollment information.

Sincerely,

/s/ Cindy Perrone

Medicare Provider Enrollment

 

 

 

 

  

  

  

 

 

 

SCHEDULE 5.11 to Credit and Guaranty Agreement

 

Real Estate Assets: In order to create in favor of the Collateral Agent, for the benefit of the Secured Parties, a valid and, subject to any filing and/or recording referred to herein, perfected First Priority security interest in a Material Real Estate Asset, the Collateral Agent shall have received, within 120 days from the acquisition of such Material Real Estate Asset or from the date such Real Estate Asset becomes a Material Real Estate Asset, from the Borrower and each applicable Guarantor:

 

(a)           fully executed and notarized Mortgages, in proper form for recording in all appropriate places in all applicable jurisdictions, encumbering each Material Real Estate Asset (each, a “Mortgaged Property”);

 

(b)           if requested by the Collateral Agent, an opinion of counsel (which counsel shall be reasonably satisfactory to the Collateral Agent) in each state in which a Mortgaged Property is located with respect to the enforceability of the form(s) of Mortgages to be recorded in such state and such other matters as the Collateral Agent may reasonably request, in each case in form and substance reasonably satisfactory to the Collateral Agent;

 

(c)           ALTA mortgagee title insurance policies or unconditional commitments therefor issued by one or more title companies (the “Title  Company”) reasonably satisfactory to the Collateral Agent with respect to each Mortgaged Property (each, a “Title Policy”), in an amount reasonably determined by the Collateral Agent (such amount not to exceed the fair market value of the Mortgaged Property) insuring the fee simple title to each of the Mortgaged Properties vested in the applicable Loan Party and insuring the Collateral Agent that the relevant Mortgage creates a valid and enforceable First Priority mortgage Liens on the Mortgaged Property encumbered thereby, each which Title Policy (A) shall include all endorsements requested by the Collateral Agent and (B) shall provide for affirmative insurance and such reinsurance as the Collateral Agent may reasonably request, all of the foregoing in form and substance reasonably satisfactory to the Collateral Agent; and evidence satisfactory to the Collateral Agent that the applicable Loan Party has (i) delivered to the Title Company all certificates and affidavits required by the Title Company in connection with the issuance of the applicable Title Policy and (ii) paid to the Title Company or to the appropriate Governmental Authorities all expenses and premiums of the Title Company and all other sums required in connection with the issuance of the Title Policies and all recording and stamp taxes (including mortgage recording and intangible taxes) payable in connection with recording the Mortgages in the applicable real property records; together with a title report issued by a title company with respect thereto, dated not more than thirty (30) days (or such other date as the Collateral Agent may reasonably agree) prior to the execution of such Mortgage and copies of all recorded documents listed as exceptions to title or otherwise referred to therein, each in form and substance reasonably satisfactory to the Collateral Agent;

 

 

  

  

  

 

 

otherwise referred to therein, each in form and substance reasonably satisfactory to the Collateral Agent;

 

(d)           (A) a completed Flood Certificate with respect to each Mortgaged Property, which Flood Certificate shall (i) be addressed to the Collateral Agent, (ii) be completed by a company which has guaranteed the accuracy of the information contained therein, and (iii) otherwise comply with the Flood Program; (B) evidence describing whether the community in which each Mortgaged Property is located participates in the Flood Program; (C) if any Flood Certificate states that a Mortgaged Property is located in a Flood Zone, the Borrower’s written acknowledgement of receipt of written notification from the Collateral Agent (i) as to the existence of each such Mortgaged Property, and (ii) as to whether the community in which each such Mortgaged Property is located is participating in the Flood Program; and (D) if any Mortgaged Property is located in a Flood Zone and is located in a community that participates in the Flood Program, evidence that the Borrower has obtained a policy of flood insurance that complies with the requirements of the Board of Governors; and

 

(e)           ALTA/ACSM surveys of all Mortgaged Properties which are not leasehold properties, certified to the Collateral Agent and dated not more than thirty (30) days (or such other date as the Collateral Agent may reasonable agree) prior to the execution of such Mortgage.

 

For the purposes of the foregoing, (i) a “Flood Certificate” means a “Standard Flood Hazard Determination Form” of the Federal Emergency Management Agency and any successor Governmental Authority performing a similar function and (ii) “Flood Program” means the National Flood Insurance Program created by the U.S. Congress pursuant to the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973, the National Flood Insurance Reform Act of 1994 and the Flood Insurance Reform Act of 2004, in each case as amended from time to time, and any successor statutes.

 

 

 

 

  

  

  

 

 

 

Schedule 6.01

 

Certain Indebtedness

 

 Amounts Due as of December 2009

RADNET MGMT, INC.

 

	
GE PROMISSORY NOTE

	
4189137-002

	
         0.00

	
GE - TOWER MAMMO

	 	
         0.00

	
GE - TVIC PET/CT

	
8535299

	
         0.00

	
GE - TVIC MRI

	
8536335

	
         0.00

	
GE - MDI PET/CT

	
8536064

	
         0.00

	
EMERYVILLE LANDLORD LOAN

	
46,927.14

	  
	
GE - EMERYVILLE CT

	
8545636

	
              220,499.53

	
CHERRY CREEK (IRVINE)

	
Assumed

	
         0.00

	
HEARTLAND (IRVINE)

	
Assumed

	
         0.00

	
MARCAP #1 (CORONA)

	  	
              624,964.37

	
MARCAP #2 (CORONA)

	  	
              101,717.96

	
DYNAMIC IMAGING

	  	
              642,620.51

	
GE - TOWER PET/CT

	
4189137-001

	
              798,278.32

	
GE - GOLD SEAL ANGIO 4100

	
4190566-001

	
              384,779.86

	
GE - HCIC PET

	
4195744-001

	
         0.00

	
GE - SFVIR GOLD SEAL CT

	
4190573-001

	
              280,760.54

	
GE - MAMMO (ANAHEIM)

	
4204049-001

	
              142,916.10

	
GE - ULTRISOUNDS (MULTIPLE SITES)

	
4204144-001

	
              869,980.34

	
CONTINENTAL #223 (CORONA)

	  	
         0.00

	
CONTINENTAL #224 (SFVIR)

	  	
         0.00

	
CONTINENTAL #225 (HCI)

	  	
         0.00

	
GE - MODESTO PET

	
4205230-001

	
              651,532.03

	
GE - STOCKTON PET

	
4198567-001

	
              707,823.47

	
GE - TOWER CARDIAC MONITOR

	
4202181-001

	
                16,605.27

	
AGFA Capital Lease (assumed-Victorville)

	  	
44,496.62

	
AGFA Capital Lease (assumed-Victorville)

	  	
35,209.13

	
AGFA Capital Lease (assumed-Victorville)

	  	
              201,765.49

	
AGFA Capital Lease (assumed-Victorville)

	  	
              241,854.81

	
GE - ORANGE IMAGING PET/CT

	
5852535-001

	
           1,763,512.32

	
GE - LOGIQ 9 & PROBES

	
5861779-001

	
              186,582.13

	
HITACHI- MRI upgrade Modesto

	  	
              336,145.30

	
Phillips – Ultrasound

	
 

	
30,228.78

	
Phillips - Film Xray Laser

	  	
20,562.70

	
Phillips - Lunar Bone Density

	  	
15,697.35

	
Philips - Instrumentation Mammo

	
 

	
71,009.81

	
Philips - RIS Logic

	  	
20,418.54

	
Philips - CPI Network Computer

	  	
         0.00

	
Philips - Merge E-Films PACS

	  	
40,984.78

	
Philips - Bucky Xray

	  	
12,614.77

	
US Bank - Mammo System 1

	  	
  6,425.20

	
US Bank - Goggles/Audio Unit

	  	
  3,098.02

	
US Bank - Cad System

	  	
         0.00

	
GE Senograph 2000

	
5863761-001

	
           1,803,469.96

	
CONTINENTAL #239 Apple Valley Kodak CR850

	  	
57,898.07

 

 

 

  

  

  

 

	
CONTINENTAL #231 Victor Valley Kodak 3000

	  	
              196,470.43

	
CONTINENTAL #241 Apple Valley Kodak 3000

	  	
                              196,470.43

	
Key Equip. Lease - Abbott lab equip

	
Assumed

	
32,654.49

	
Key Equip. Lease - Acuson

	
Assumed

	
16,143.79

	
Philips - 1.5T MRI - PH007307

	
Assumed

	
              568,222.10

	
Philips - Optistar Injectors - PH007311

	
Assumed

	
38,342.75

	
Philips RIS/PACS - PH006910

	
Assumed

	
45,160.77

	
Philips - Tele Voice Mail sys - PH007310

	
Assumed

	
68,040.63

	
Philips - Leasehold Improv - PH007311

	
Assumed

	
              255,099.98

	
Philips - C-Arm & Table - PH007312

	
Assumed

	
16,992.00

	
CONTINENTAL #263 Encimo Breastcare Dell FE/FC 80 X-Ray system

	  	
51,968.88

	
GE - TOWER Womens (4) Senographs

	
8392036-001

	
              937,932.74

	
GE Hologic Mammo - Orange Womens

	
8399235-001

	
              376,695.18

	
GE PET CT Scanner - Liberty Encino

	  	
           1,630,869.52

	
GE - Achieva 3T - Rolling Oaks

	  	
              911,387.67

	
Hitachi - Pittsburg MRI

	  	
              368,800.06

	
GE CT16 Scanner - Fresno/MDI T.O.

	  	
              660,242.86

	
CONTINENTAL #252 Camarillo X-Ray System

	 	
68,982.16

	
CONTINENTAL #253 Encino Breastcare Hologic

	
 

	
               569,072.81

	
CONTINENTAL #254 Redondo X-Ray System

	  	
39,113.11

	
CONTINENTAL #256 Los Coyotes - Kodak PACS

	  	
82,892.78

	
CONTINENTAL #267 Los Coyotes Kodak DR3500

	  	
              251,466.87

	
CONTINENTAL #268 TVIC Wildomar X-Ray System

	  	
62,445.67

	
CONTINENTAL #269 Staples X-Ray System

	  	
56,450.12

	
Philips - Brilliance 64 Slice & Gemini PET

	  	
              727,434.30

 

 

 

 

 

 

  

  

  

 

 

 

Schedule 6.01

 

Certain Indebtedness

 

 

	
RADIOLOGIX

	
Amount due as of December 2009

 

 

	
GE - TARZANA MRI/ Mid Rockland

	
8537637

	
80,711.90

	
GE - HFS CONTRACT - Contracts

	  	
 1,189,600.51

	
GE - HFS CONTRACT - IDE- MRI (Park Ridg

	
4187428-001

	
              617,993.65

	
DVI Financial Services # 3279 - Rockville MRI

	  	
   0.00

	
GE - HFS CONTRACT - Community PET/CT

	
4200349-001

	
              624,953.54

	
BORG - Loan # 4337892-001

	
Assumed

	
              105,442.42

	
BORG - Loan # 8537110-001

	
Assumed

	
25,540.21

	
BORG - PACS 01

	
Assumed

	
         0.00

	
BORG - PACS 02

	
Assumed

	
  8,159.12

	
BORG - PACS 03

	
Assumed

	
10,956.64

	
BORG - PACS 04

	
Assumed

	
  6,248.92

	
BORG - PACS 05

	
Assumed

	
10,893.94

	
BORG - PACS extra disks

	
Assumed

	
  2,825.27

	
CONTINENTAL #227 (Mid-Rockland-New Platz)

	  	
         0.00

	
CONTINENTAL #228 (Advanced-Hartford)

	  	
         0.00

	
CONTINENTAL #229 (Valley-Los Gatos)

	  	
         0.00

	
GE - Lease - (Advanced-Hartford)

	
 5852348-001

	
              656,243.28

	
GE - Healthcare Lease - IDE- Clinton Crossin

	
5853127-001

	
              418,604.00

	
CONTINENTAL #230 (IDE - Park Ridge)

	  	
44,878.49

	
GE - Healthcare (Community - Silver Spring

	
5861563-001

	
              474,241.92

	
GE - Lease - (Advanced-Crossroads)

	
5854949-001

	
              675,175.00

	
CONTINENTAL #235 (ADV-Crain Towers)

	  	
46,563.64

	
CONTINENTAL #236 (IDE - Park Ridge)

	  	
67,114.08

	
HITACHI-Questar Victorville 50006

	  	
              258,152.46

	
GE HFS Midrockland-Nyack

	
5861781-001

	
           1,206,089.73

	
Operating Lease buyout - GE IDE

	
8529361-003

	
              373,729.42

	
Operating Lease buyout - GE IDE

	
8540153-002

	
85,108.70

	
Operating Lease buyout - GE VALLEY

	
8529208-002

	
              505,717.56

	
Operating Lease buyout - GE IDE

	
8529188-003

	
              329,421.80

	
Operating Lease buyout - GE ADVANCED

	
8534292-002

	
              283,713.83

	
Operating Lease buyout - GE IDE

	
8534346-002

	
              300,229.17

	
Operating Lease buyout - GE MID ROCKLAN

	
8534407-002

	
              163,288.13

	
Operating Lease buyout - GE COMMUNITY

	
8533778-002

	
              447,294.65

	
Operating Lease buyout - GE NORCAL

	
8532360-002

	
              469,216.88

	
Operating Lease buyout - GE ADVANCED

	
8534297-002

	
              410,611.79

	
Operating Lease buyout - GE ADVANCED

	
8534298-002

	
              361,941.62

	
CONTINENTAL #233 (Community - Olney)

	  	
79,648.59

	
CONTINENTAL #234 (Community - Intrn'l Drive)

	  	
79,648.59

	
CONTINENTAL #237 (Community - Germantown)

	  	
79,648.59

	
CONTINENTAL #238 (Community - Clinton)

	  	
79,648.59

	
Bank of America 12 Clientpro computers Papastavros

	 	
         0.00

	
Philips HDI 5000 Ultrasound PH005460 Papastavros

	 	
  5,890.53

	
Philips HDI 5000 Ultrasound PH005461 Papastavros

	 	
  5,391.13

	
Philips HDI 5000 Ultrasound PH005462 Papastavros

	 	
  5,391.13

	
Philips HDI 5000 Ultrasound PH005463 Papastavros

	 	
  8,235.85

	
Cisco Cap[ital- Software for PACS access Papastavros

	 	
21,004.67

	
Key Bank Financial - Tenant Improv. N. Arundel

	
             

	 321,654.38  
	
GE HFS Valley - Samaritan

	
5865951-001

	
           1,242,167.57

	
CONTINENTAL #243 (Advanced-No. Arundel)

	  	
60,186.71

	
CONTINENTAL #244 (Advanced-Annapolis)

	  	
60,186.71

 

 

 

  

  

  

 

	
CoActiv Capital -(Advanced- North Arundel)

	 	
              550,290.50

	
HITACHI-Ellicott City Open MRI

	
17052-001

	
         0.00

	
HITACHI-Ellicott City Open MRI

	
17052-002

	
         0.00

	
HITACHI-Ellicott City Open MRI

	
17052-003

	
         0.00

	
GE - GOLD SEAL PET (Pleasanton)

	
4192254-001

	
              576,112.32

	
CONTINENTAL #248 (Various sites)

	 	
              583,160.62

	
CONTINENTAL #264 (Advanced-No. ArundeDR 3500 System

	 	  230,091.23
	
GE HFS Midrockland-MRI Upgrade

	
8537637-002

	
43,614.01

	
GE HFS Valley/Samaritan 2 Selena Mamm

	
8399238-001

	
              413,900.84

	
GE HFS Community/White Oak-Selena Mam

	
8399231-001

	
              223,151.26

	
GE HFS Middletown-MRI

	
8535941-001

	
              421,140.68

	
GE HFS Middletown-CT

	
8535942-001

	
              245,097.99

	
GE HFS Middletown-Ultrasound

	
8535943-001

	
22,907.20

	
GE HFS Middletown-other FF&E

	
8535946-001

	
17,818.88

	
GE HFS Middletown-Leasehold Improvemen

	
8535945-001

	
              152,920.55

	
Continental #249 Augustine Kodak DR 3500

	 	
              249,540.78

	
Continental #250 Polly Drummond Kodak DR 3500

	 	
              249,540.78

	
Continental #251 Valley Brewster X-Ray system

	 	
72,053.05

	
Continental #257 Bethesda - Kodak CR 975

	 	
              124,349.08

	
Continental #258 Community Bowie Elite PACS

	 	
87,467.43

	
Continental #259 Silverside - Kodak CR 975

	 	
             127,617.72

	
Continental #260 Middletown Leasehold Improv

	 	
              101,066.81

	
Continental #261Glasgow - Kodak CR 975

	 	
              127,617.72

	
Continental #262 Delaware Lewes Elite PACS

	 	
              101,066.81

	
Continental #265 Delaware Lewes Elite PACS

	 	
87,467.43

	
Continental #266 Glasgow - Kodak CR 975

	 	
              124,349.08

	
Loan - GE MR 1.5T Infinity with Excite

	
8415113-001

	
              570,751.97

	
Loan - Discovery ST4 Pet/CT 4 slice, Infin

	
8415126-001

	
           1,528,046.46

	
Loan - Linden Oaks-GE LightSpeed QXI

	
8415152-001

	
              378,063.04

	
Loan - GE Lightspeed 16 CT

	
8415103-001

	
              350,991.98

	  	  	  
	
Capital Leases & Notes Payable - Total

	 	
                         37,206,949.25

	  	  	  
	
Unsecured - Total

	 	
                           1,483,343.61

 

 

 

  

  

  

 

 

Schedule 6.02

 

Certain Liens

 

 

Amount due as of 2009

 

RADNET MGMT, INC.

 

 

	
GE - TOWER MAMMO

	  	
         0.00

	
GE - TVIC PET/CT

	
8535299

	
0.00

	
GE - TVIC MRI

	
8536335

	
  0.00

	
GE - MDI PET/CT

	
8536064

	
        0.00

	
EMERYVILLE LANDLORD LOAN

	  	
46,927.14

	
GE - EMERYVILLE CT

	
8545636

	
             220,499.53

	
CHERRY CREEK (IRVINE)

	
Assumed

	
             0.00

	
HEARTLAND (IRVINE)

	
Assumed

	
         0.00

	
MARCAP #1 (CORONA)

	
 

	
    624,964.37

	
MARCAP #2 (CORONA)

	  	
101,717.96

	
DYNAMIC IMAGING

	  	
642,620.51

	
GE - TOWER PET/CT

	
4189137-001

	
             798,278.32

	
GE - GOLD SEAL ANGIO 4100

	
4190566-001

	
             384,779.86

	
GE - HCIC PET

	
4195744-001

	
                        0.00

	
GE - SFVIR GOLD SEAL CT

	
4190573-001

	
             280,760.54

	
GE - MAMMO (ANAHEIM)

	
4204049-001

	
             142,916.10

	
GE - ULTRISOUNDS (MULTIPLE SITES)

	
4204144-001

	
             869,980.34

	
GE - MODESTO PET

	
4205230-001

	
             651,532.03

	
GE - STOCKTON PET

	
4198567-001

	
             707,823.47

	
GE - TOWER CARDIAC MONITOR

	
4202181-001

	
16,605.27

	
AGFA Capital Lease (assumed-Victorville)

	  	
44,496.62

	
AGFA Capital Lease (assumed-Victorville)

	  	
35,209.13

	
AGFA Capital Lease (assumed-Victorville)

	 	
             201,765.49

	
AGFA Capital Lease (assumed-Victorville)

	 	
             241,854.81

	
GE - ORANGE IMAGING PET/CT

	
5852535-001

	
          1,763,512.32

	
GE - LOGIQ 9 & PROBES

	
5861779-001

	
             186,582.13

	
HITACHI- MRI upgrade Modesto

	 	
             336,145.30

	
Phillips - Ultrasound

	 	
30,228.78

	
Phillips - Film Xray Laser

	 	
20,562.70

 

 

  

  

  

 

	
Phillips - Lunar Bone Density

	  	
15,697.35

	
Philips - Instrumentation Mammo

	  	
71,009.81

	
Philips - RIS Logic

	  	
20,418.54

	
Philips - CPI Network Computer

	  	
         0.00

	
Philips - Merge E-Films PACS

	  	
40,984.78

	
Philips - Bucky Xray

	  	
12,614.77

	
US Bank - Mammo System

	  	
16,425.20

	
US Bank - Goggles/Audio Unit

	  	
  3,098.02

	
US Bank - Cad System

	  	
         0.00

	
GE Senograph 2000

	
5863761-001

	
          1,803,469.96

	
Key Equip. Lease - Abbott lab equip

	
Assumed

	
32,654.49

	
Key Equip. Lease - Acuson

	
Assumed

	
16,143.79

	
Philips - 1.5T MRI - PH007307

	
Assumed

	
             568,222.10

	
Philips - Optistar Injectors - PH007311

	
Assumed

	
38,342.75

	
Philips RIS/PACS - PH006910

	
Assumed

	
45,160.77

	
Philips - Tele Voice Mail sys - PH007310

	
Assumed

	
68,040.63

	
Philips - Leasehold Improv - PH007311

	
Assumed

	
             255,099.98

	
Philips - C-Arm & Table - PH007312

	
Assumed

	
16,992.00

	
GE - TOWER Womens (4) Senographs

	
8392036-001

	
             937,932.74

	
GE Hologic Mammo - Orange Womens

	
8399235-001

	
             376,695.18

	
GE PET CT Scanner - Liberty Encino

	  	
          1,630,869.52

	
GE - Achieva 3T - Rolling Oaks

	  	
             911,387.67

	
Hitachi - Pittsburg MRI

	  	
             368,800.06

	
GE CT16 Scanner - Fresno/MDI T.O.

	  	
             660,242.86

	
CONTINENTAL #252 Camarillo X-Ray System

	  	
68,982.16

	
CONTINENTAL #253 Encino Breastcare Hologic

	  	
             569,072.81

	
CONTINENTAL #254 Redondo X-Ray System

	  	
39,113.11

	
CONTINENTAL #256 Los Coyotes - Kodak PACS

	  	
82,892.78

	
CONTINENTAL #267 Los Coyotes Kodak DR3500

	  	
             251,466.87

	
CONTINENTAL #268 TVIC Wildomar X-Ray System

	  	
62,445.67

	
CONTINENTAL #269 Staples X-Ray System

	  	
56,450.12

	
Philips - Brilliance 64 Slice & Gemini PET

	  	
             727,434.30

 

 

  

  

  

 

 

Schedule 6.02

 

Certain Liens

 

 

	
RADIOLOGIX

	
Amount due as of December 2009

 

 

	
GE - TARZANA MRI/ Mid Rockland

	
8537637

	
80,711.90

	
GE - HFS CONTRACT - Contracts

	 	
         1,189,600.51

	
GE - HFS CONTRACT - IDE- MRI (Park Ridg

	
4187428-001

	
            617,993.65

	
DVI Financial Services # 3279 - Rockville MRI

	 	
         0.00

	
GE - HFS CONTRACT - Community PET/CT

	
4200349-001

	
            624,953.54

	
BORG - Loan # 4337892-001

	
Assumed

	
            105,442.42

	
BORG - Loan # 8537110-001

	
Assumed

	
25,540.21

	
BORG - PACS 01

	
Assumed

	
         0.00

	
BORG - PACS 02

	
Assumed

	
  8,159.12

	
BORG - PACS 03

	
Assumed

	
10,956.64

	
BORG - PACS 04

	
Assumed

	
  6,248.92

	
BORG - PACS 05

	
Assumed

	
10,893.94

	
BORG - PACS extra disks

	
Assumed

	
  2,825.27

	
GE - Lease - (Advanced-Hartford)

	
5852348-001

	
            656,243.28

	
GE - Healthcare Lease - IDE- Clinton Crossin

	
5853127-001

	
            418,604.00

	
GE - Healthcare (Community - Silver Spring

	
5861563-001

	
            474,241.92

	
GE - Lease - (Advanced-Crossroads)

	
5854949-001

	
            675,175.00

	
HITACHI-Questar Victorville 50006

	 	
            258,152.46

	
GE HFS Midrockland-Nyack

	
5861781-001

	
         1,206,089.73

	
Operating Lease buyout - GE IDE

	
8529361-003

	
            373,729.42

	
Operating Lease buyout - GE IDE

	
8540153-002

	
85,108.70

	
Operating Lease buyout - GE VALLEY

	
8529208-002

	
            505,717.56

	
Operating Lease buyout - GE IDE

	
8529188-003

	
            329,421.80

	
Operating Lease buyout - GE ADVANCED

	
8534292-002

	
            283,713.83

	
Operating Lease buyout - GE IDE

	
8534346-002

	
            300,229.17

	
Operating Lease buyout - GE MID ROCKLAN

	
8534407-002

	
            163,288.13

	
Operating Lease buyout - GE COMMUNITY

	
8533778-002

	
            447,294.65

	
Operating Lease buyout - GE NORCAL

	
8532360-002

	
            469,216.88

	
Operating Lease buyout - GE ADVANCED

	
8534297-002

	
            410,611.79

	
Operating Lease buyout - GE ADVANCED

	
8534298-002

	
            361,941.62

	
Bank of America 12 Clientpro computers Papastavros

	  	
         0.00

	
Philips HDI 5000 Ultrasound PH005460 Papastavros

	  	
  5,890.53

 

 

  

  

  

 

	
Philips HDI 5000 Ultrasound PH005461 Papastavros

	  	
  5,391.13

	
Philips HDI 5000 Ultrasound PH005462 Papastavros

	  	
  5,391.13

	
Philips HDI 5000 Ultrasound PH005463 Papastavros

	  	
  8,235.85

	
Cisco Cap[ital- Software for PACS access Papastavros

	  	
21,004.67

	
Key Bank Financial - Tenant Improv. N. Arundel

	  	
            321,654.38

	
GE HFS Valley - Samaritan

	
5865951-001

	
         1,242,167.57

	
CoActiv Capital -(Advanced- North Arundel)

	  	
            550,290.50

	
HITACHI-Ellicott City Open MRI

	
17052-001

	
         0.00

	
HITACHI-Ellicott City Open MRI

	
17052-002

	
         0.00

	
HITACHI-Ellicott City Open MRI

	
17052-003

	
         0.00

	
GE - GOLD SEAL PET (Pleasanton)

	
4192254-001

	
            576,112.32

	
CONTINENTAL #248 (Various sites)

	  	
            583,160.62

	
GE HFS Midrockland-MRI Upgrade

	
8537637-002

	
              43,614.01

	
GE HFS Valley/Samaritan 2 Selena Mamm

	
8399238-001

	
            413,900.84

	
GE HFS Community/White Oak-Selena Mam

	
8399231-001

	
            223,151.26

	
GE HFS Middletown-MRI

	
8535941-001

	
            421,140.68

	
GE HFS Middletown-CT

	
8535942-001

	
            245,097.99

	
GE HFS Middletown-Ultrasound

	
8535943-001

	
22,907.20

	
GE HFS Middletown-other FF&E

	
8535946-001

	
17,818.88

	
Continental #249 Augustine Kodak DR 3500

	  	
            249,540.78

	
Continental #250 Polly Drummond Kodak DR 3500

	  	
            249,540.78

	
Continental #251 Valley Brewster X-Ray system

	  	
72,053.05

	
Continental #257 Bethesda - Kodak CR 975

	  	
            124,349.08

	
Continental #258 Community Bowie Elite PACS

	  	
87,467.43

	
Continental #259 Silverside - Kodak CR 975

	  	
            127,617.72

	
Continental #260 Middletown Leasehold Improv

	  	
            101,066.81

	
Continental #261Glasgow - Kodak CR 975

	  	
            127,617.72

	
Continental #262 Delaware Lewes Elite PACS

	  	
            101,066.81

	
Continental #265 Delaware Lewes Elite PACS

	  	
87,467.43

	
Continental #266 Glasgow - Kodak CR 975

	  	
            124,349.08

	
Loan - GE MR 1.5T Infinity with Excite

	
8415113-001

	
            570,751.97

	
Loan - Discovery ST4 Pet/CT 4 slice, Infin

	
8415126-001

	
         1,528,046.46

	
Loan - Linden Oaks-GE LightSpeed QXI

	
8415152-001

	
            378,063.04

	
Loan - GE Lightspeed 16 CT

	
8415103-001

	
            350,991.98

	  	  	  
	
Capital Leases & Notes Payable – Total

	
    

	   37,206,949.25

 

 

 

  

  

  

 

 

SCHEDULE 6.06

 

CERTAIN INVESTMENTS

 

 

Advanced Imaging Partners, Inc. owns a 100% interest in Advanced NA, LLC, a Maryland limited liability company, which in turn owns a 35% interest in Baltimore Washington Imaging Center, LLC, a Maryland limited liability company.

 

Advanced Imaging Partners, Inc. owns a 100% interest in Advanced Radiology, L.L.C., a Maryland limited liability company, which in turn owns (i) a 1% interest in Advanced PET Imaging of Maryland, L.P., a Maryland limited partnership (Advanced Imaging Partners, Inc. directly owns a 94% interest in such limited partnership), (ii) a 40% interest in Carroll County Radiology, LLC, a Maryland limited liability company, (iii) a 50% interest in Greater Baltimore Diagnostic Imaging Partnership, a Maryland general partnership, (iv) a 49% interest in Advanced Imaging at St. Joseph Medical Center, LLC, a Maryland limited liability company, (v) a 50% interest in Health Systems Imaging, LLC, a Maryland limited liability company, and (vi) a 25% interest in MIB Partnership (d/b/a Magnetic Imaging of Baltimore), a Maryland general partnership.

 

Advanced Imaging Partners, Inc. owns a 49% interest in Franklin Imaging, LLC, a Maryland limited liability company.

 

Community Imaging Partners, Inc. owns a 90% interest in Montgomery Community Magnetic Imaging Center Limited Partnership, a Maryland limited partnership.

 

Radiology and Nuclear Medicine Imaging Partners, Inc. owns a 22.4% interest in Magnetic Resonance Imaging Center of Kansas, L.P., a Kansas limited partnership.

 

 

  

  

  

 

 

SCHEDULE 6.16

 

SCHEDULE 6.16 to Credit and Guaranty Agreement

 

POST-CLOSING UNDERTAKINGS

 

Personal Property Collateral: The Borrower shall deliver to the Collateral Agent within 30 days after the Closing Date, a Landlord Personal Property Collateral Access Agreement executed by the landlord of the Borrower’s corporate headquarters office and the Borrower.

 

Good Standing Certificates: The Borrower shall deliver to the Administrative Agent within 10 Business Days after the Closing Date (or such other date as the Administrative Agent may reasonably agree), a good standing certificate from the applicable Governmental Authority of each of FRI, Inc. and FRI II, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

  

  

  

 

 

EXHIBIT A-1 TO

CREDIT AND GUARANTY AGREEMENT

BORROWING NOTICE

 

Reference is made to the Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent.

 

Pursuant to Sections 2.01, 2.02 and 2.03 of the Credit Agreement, Borrower desires that Lenders make the following Loans to Borrower in accordance with the applicable terms and conditions of the Credit Agreement on  [mm/dd/yy] (the “Credit Date”):

 

	  	  
	
Tranche B Term Loans

 

    o Base Rate Loans:

 

o Eurodollar Rate Loans, with an initial Interest Period of ________ month(s):

	
 

 

$[___,___,___]

 

$[___,___,___]

	  	  
	
Revolving Loans

 

 o Base Rate Loans:

 

o Eurodollar Rate Loans, with an initial Interest Period of ________ month(s):

	
 

 

$[___,___,___]

 

$[___,___,___]

	  	  
	
Swing Line Loans:

	
$[___,___,___]

	  	  

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT A-1-1

  

 

 

Borrower hereby certifies that:

 

(i)           after making the Loans requested on the Credit Date, the Total Utilization of Revolving Commitments shall not exceed the Revolving Commitments then in effect;

(ii)           as of the Credit Date, the representations and warranties contained in each of the Loan Documents are true, correct and complete in all material respects on and as of such Credit Date to the same extent as though made on and as of such date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties are true, correct and complete in all material respects on and as of such earlier date, provided that, in each case, to the extent that any such representation and warranty is already qualified by materiality or material adverse effect, such representation and warranty shall be true and correct in all respects;

(iii)           as of the Credit Date, no event has occurred and is continuing or would result from the consummation of the borrowing contemplated hereby that would constitute an Event of Default or a Default.

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
Date: [mm/dd/yy]

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

 

 

EXHIBIT A-1-2

 

 

EXHIBIT A-2 TO

CREDIT AND GUARANTY AGREEMENT

CONVERSION/CONTINUATION NOTICE

 

Reference is made to the Credit and Guaranty Agreement, dated as of  April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent.

 

Pursuant to Section 2.09 of the Credit Agreement, Borrower desires to convert or to continue the following Loans, each such conversion and/or continuation to be effective as of [mm/dd/yy]:

 

1.  Tranche B Term Loans:

 

	
$[___,___,___]

	
Eurodollar Rate Loans to be continued with Interest Period of [____] month(s)

	  	  
	
$[___,___,___]

	
Base Rate Loans to be converted to Eurodollar Rate Loans with Interest Period of ____ month(s)

	  	  
	
$[___,___,___]

	
Eurodollar Rate Loans to be converted to Base Rate Loans

	  	  

2.  Revolving Loans:

 

	
$[___,___,___]

	
Eurodollar Rate Loans to be continued with Interest Period of [____] month(s)

	  	  
	
$[___,___,___]

	
Base Rate Loans to be converted to Eurodollar Rate Loans with Interest Period of ____ month(s)

	  	  
	
$[___,___,___]

	
Eurodollar Rate Loans to be converted to Base Rate Loans

Borrower hereby certifies that as of the date hereof, no event has occurred and is continuing or would result from the consummation of the conversion and/or continuation contemplated hereby that would constitute an Event of Default or a Default.

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
Date: [mm/dd/yy]

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

EXHIBIT A-2-1

  

EXHIBIT A-3 TO

CREDIT AND GUARANTY AGREEMENT

ISSUANCE NOTICE

 

Reference is made to the Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS2, as Documentation Agent.

 

Pursuant to Section 2.04 of the Credit Agreement, Borrower desires a Letter of Credit to be issued in accordance with the terms and conditions of the Credit Agreement on [mm/dd/yy] (the “Credit Date”) in an aggregate face amount of $[___,___,___].

 

Attached hereto for each such Letter of Credit are the following:

 

(a)           the stated amount of such Letter of Credit;

 

(b)           the name and address of the beneficiary;

 

(c)           the expiration date; and

 

(d)           either (i) the verbatim text of such proposed Letter of Credit, or (ii) a description of the proposed terms and conditions of such Letter of Credit, including a precise description of any documents to be presented by the beneficiary which, if presented by the beneficiary prior to the expiration date of such Letter of Credit, would require the Issuing Lender to make payment under such Letter of Credit.

 

Borrower hereby certifies that:

 

(i)           after issuing such Letter of Credit requested on the Credit Date, the Total Utilization of Revolving Commitments shall not exceed the Revolving Commitments then in effect;

 

(ii)           as of the Credit Date, the representations and warranties contained in each of the Loan Documents are true, correct and complete in all material respects on and as of such Credit Date to the same extent as though made on and as of such date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties are true, correct and complete in all material respects on and as of such earlier date, provided that, in each case, to the extent that any such representation and warranty is already qualified by materiality or material adverse effect, such representation and warranty shall be true and correct in all respects;

 

(iii)           as of such Credit Date, no event has occurred and is continuing or would result from the consummation of the issuance contemplated hereby that would constitute an Event of Default or a Default.

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
Date: [mm/dd/yy]

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

EXHIBIT A-3-1

  

EXHIBIT B-1 TO

CREDIT AND GUARANTY AGREEMENT

TRANCHE B TERM LOAN NOTE

 

$[1][___,___,___]

April 6, 2010 New York, New York

FOR VALUE RECEIVED, RADNET MANAGEMENT, INC., a California corporation (“Borrower”), promises to pay [NAME OF LENDER] (“Payee”) or its registered assigns the principal amount of [1][DOLLARS] ($[1][___,___,___]) in the installments referred to below.

 

Borrower also promises to pay interest on the unpaid principal amount hereof, from the date hereof until paid in full, at the rates and at the times which shall be determined in accordance with the provisions of that certain Credit and Guaranty Agreement, dated as of  April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS3, as Documentation Agent.

 

Borrower shall make principal payments on this Note as set forth in Section 2.12 of the Credit Agreement.

 

This Note is one of the “Tranche B Term Loan Notes” in the aggregate principal amount of $285,000,000.00 and is issued pursuant to and entitled to the benefits of the Credit Agreement, to which reference is hereby made for a more complete statement of the terms and conditions under which the Term Loan evidenced hereby was made and is to be repaid.

 

All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in same day funds at the Principal Office of Administrative Agent or at such other place as shall be designated in writing for such purpose in accordance with the terms of the Credit Agreement.  Unless and until an Assignment Agreement effecting the assignment or transfer of the obligations evidenced hereby shall have been accepted by Administrative Agent and recorded in the Register, Borrower, each Agent and Lenders shall be entitled to deem and treat Payee as the owner and holder of this Note and the obligations evidenced hereby.  Payee hereby agrees, by its acceptance hereof, that before disposing of this Note or any part hereof it will make a notation hereon of all principal payments previously made hereunder and of the date to which interest hereon has been paid; provided, the failure to make a notation of any payment made on this Note shall not limit or otherwise affect the obligations of Borrower hereunder with respect to payments of principal of or interest on this Note.

 

This Note is subject to mandatory prepayment and to prepayment at the option of Borrower, each as provided in the Credit Agreement.

 

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

 

 

 

[1]           Lender’s Tranche B Term Loan Commitment

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates. 

 

  

EXHIBIT B-1-1

  

 

 

Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note, together with all accrued and unpaid interest thereon, may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement.

 

The terms of this Note are subject to amendment only in the manner provided in the Credit Agreement.

 

No reference herein to the Credit Agreement and no provision of this Note or the Credit Agreement shall alter or impair the obligations of Borrower, which are absolute and unconditional, to pay the principal of and interest on this Note at the place, at the respective times, and in the currency herein prescribed.

 

Borrower promises to pay all costs and expenses, including reasonable attorneys’ fees, all as provided in the Credit Agreement, incurred in the collection and enforcement of this Note.  Borrower and any endorsers of this Note hereby consent to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.

 

[Remainder of page intentionally left blank]

 

 

 

 

 

 

  

EXHIBIT B-1-2

  

 

 

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and delivered by its officer thereunto duly authorized as of the date and at the place first written above.

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

 

 

 

 

 

 

  

EXHIBIT B-1-3

  

EXHIBIT B-2 TO

CREDIT AND GUARANTY AGREEMENT

REVOLVING LOAN NOTE

$[1][___,___,___]

April 6, 2010 New York, New York

FOR VALUE RECEIVED, RADNET MANAGEMENT, INC., a California corporation (“Borrower”), promises to pay [NAME OF LENDER] (“Payee”) or its registered assigns, on or before [mm/dd/yy], the lesser of (a) [1][DOLLARS] ($[1][___,___,___]) and (b) the unpaid principal amount of all advances made by Payee to Borrower as Revolving Loans under the Credit Agreement referred to below.

 

Borrower also promises to pay interest on the unpaid principal amount hereof, from the date hereof until paid in full, at the rates and at the times which shall be determined in accordance with the provisions of that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS4, as Documentation Agent.

 

This Note is one of the “Revolving Loan Notes” in the aggregate principal amount of $100,000,000.00 and is issued pursuant to and entitled to the benefits of the Credit Agreement, to which reference is hereby made for a more complete statement of the terms and conditions under which the Loans evidenced hereby were made and are to be repaid.

 

All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in same day funds at the Principal Office of Administrative Agent or at such other place as shall be designated in writing for such purpose in accordance with the terms of the Credit Agreement.  Unless and until an Assignment Agreement effecting the assignment or transfer of the obligations evidenced hereby shall have been accepted by Administrative Agent and recorded in the Register, Borrower, each Agent and Lenders shall be entitled to deem and treat Payee as the owner and holder of this Note and the obligations evidenced hereby.  Payee hereby agrees, by its acceptance hereof, that before disposing of this Note or any part hereof it will make a notation hereon of all principal payments previously made hereunder and of the date to which interest hereon has been paid; provided, the failure to make a notation of any payment made on this Note shall not limit or otherwise affect the obligations of Borrower hereunder with respect to payments of principal of or interest on this Note.

 

This Note is subject to mandatory prepayment and to prepayment at the option of Borrower, each as provided in the Credit Agreement.

 

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

 

 

 

[1]           Lender’s Revolving Commitment

  

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT B-2-1

  

 

 

Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note, together with all accrued and unpaid interest thereon, may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement.

 

The terms of this Note are subject to amendment only in the manner provided in the Credit Agreement.

 

No reference herein to the Credit Agreement and no provision of this Note or the Credit Agreement shall alter or impair the obligations of Borrower, which are absolute and unconditional, to pay the principal of and interest on this Note at the place, at the respective times, and in the currency herein prescribed.

 

Borrower promises to pay all costs and expenses, including reasonable attorneys’ fees, all as provided in the Credit Agreement, incurred in the collection and enforcement of this Note.  Borrower and any endorsers of this Note hereby consent to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.

 

[Remainder of page intentionally left blank]

 

 

 

 

 

 

  

 

  

EXHIBIT B-2-2

  

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and delivered by its officer thereunto duly authorized as of the date and at the place first written above.

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

  

EXHIBIT B-2-3

  

	
TRANSACTIONS ON

REVOLVING LOAN NOTE

 

	

 

Date

	

Amount of Loan Made This Date

	

Amount of Principal Paid This Date

	

Outstanding Principal

Balance This Date

	

Notation

Made By

	  	  	  	  	  
	  	  	  	  	  

 

 

 

 

 

  

EXHIBIT B-2-4

  

EXHIBIT B-3 TO

CREDIT AND GUARANTY AGREEMENT

SWING LINE NOTE

$[1][___,___,___]

April 6, 2010 New York, New York

FOR VALUE RECEIVED, RADNET MANAGEMENT, INC., a California corporation  (“Borrower”), promises to pay to BARCLAYS BANK PLC, as Swing Line Lender (“Payee”), on or before [mm/dd/yy], the lesser of (a) [1][DOLLARS] ($[___,___,___]) and (b) the unpaid principal amount of all advances made by Payee to Borrower as Swing Line Loans under the Credit Agreement referred to below.

 

Borrower also promises to pay interest on the unpaid principal amount hereof, from the date hereof until paid in full, at the rates and at the times which shall be determined in accordance with the provisions of that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS5, as Documentation Agent.

 

This Note is the “Swing Line Note” and is issued pursuant to and entitled to the benefits of the Credit Agreement, to which reference is hereby made for a more complete statement of the terms and conditions under which the Swing Line Loans evidenced hereby were made and are to be repaid.

 

All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in same day funds at the Principal Office of Swing Line Lender or at such other place as shall be designated in writing for such purpose in accordance with the terms of the Credit Agreement.

 

This Note is subject to mandatory prepayment and to prepayment at the option of Borrower, each as provided in the Credit Agreement.

 

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF.

 

 

 

[1]           Swing Line Sublimit

  

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

B-3-1

  

 

 

Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note, together with all accrued and unpaid interest thereon, may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement.

 

The terms of this Note are subject to amendment only in the manner provided in the Credit Agreement.

 

No reference herein to the Credit Agreement and no provision of this Note or the Credit Agreement shall alter or impair the obligations of Borrower, which are absolute and unconditional, to pay the principal of and interest on this Note at the place, at the respective times, and in the currency herein prescribed.

 

Borrower promises to pay all costs and expenses, including reasonable attorneys’ fees, all as provided in the Credit Agreement, incurred in the collection and enforcement of this Note.  Borrower and any endorsers of this Note hereby consent to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.

 

[Remainder of page intentionally left blank]

 

 

 

 

 

 

 

  

B-3-2

  

 

 

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and delivered by its officer thereunto duly authorized as of the date and at the place first written above.

 

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

 

 

  

B-3-3

  

	
TRANSACTIONS ON

SWING LINE NOTE

 

	

 

Date

	

Amount of Loan Made This Date

	

Amount of Principal Paid This Date

	

Outstanding Principal

Balance This Date

	

Notation

Made By

	  	  	  	  	  
	  	  	  	  	  

 

 

 

 

 

 

 

 

 

  

B-3-4

  

EXHIBIT B-4 TO

CREDIT AND GUARANTY AGREEMENT

INCREMENTAL TERM LOAN NOTE

 

$[1][___,___,___]

[_________], 20[_] New York, New York

FOR VALUE RECEIVED, RADNET MANAGEMENT, INC., a California corporation (“Borrower”), promises to pay [NAME OF LENDER] (“Payee”) or its registered assigns the principal amount of [1][DOLLARS] ($[1][___,___,___]) in the installments referred to below.

 

Borrower also promises to pay interest on the unpaid principal amount hereof, from the date hereof until paid in full, at the rates and at the times which shall be determined in accordance with the provisions of that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS6, as Documentation Agent.

 

Borrower shall make principal payments on this Note as set forth in Section 2.24 of the Credit Agreement.

 

This Note is one of the “Incremental Term Loan Notes” in the aggregate principal amount of $[___,___,___] and is issued pursuant to and entitled to the benefits of the Credit Agreement, to which reference is hereby made for a more complete statement of the terms and conditions under which the Term Loan evidenced hereby was made and is to be repaid.

 

All payments of principal and interest in respect of this Note shall be made in lawful money of the United States of America in same day funds at the Principal Office of Administrative Agent or at such other place as shall be designated in writing for such purpose in accordance with the terms of the Credit Agreement.  Unless and until an Assignment Agreement effecting the assignment or transfer of the obligations evidenced hereby shall have been accepted by Administrative Agent and recorded in the Register, Borrower, each Agent and Lenders shall be entitled to deem and treat Payee as the owner and holder of this Note and the obligations evidenced hereby.  Payee hereby agrees, by its acceptance hereof, that before disposing of this Note or any part hereof it will make a notation hereon of all principal payments previously made hereunder and of the date to which interest hereon has been paid; provided, the failure to make a notation of any payment made on this Note shall not limit or otherwise affect the obligations of Borrower hereunder with respect to payments of principal of or interest on this Note.

 

This Note is subject to mandatory prepayment and to prepayment at the option of Borrower, each as provided in the Credit Agreement.

 

THIS NOTE AND THE RIGHTS AND OBLIGATIONS OF BORROWER AND PAYEE HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

 

 

 

[1]           Lender’s Incremental Term Loan Commitment

  

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT B-4-1

  

 

 

Upon the occurrence of an Event of Default, the unpaid balance of the principal amount of this Note, together with all accrued and unpaid interest thereon, may become, or may be declared to be, due and payable in the manner, upon the conditions and with the effect provided in the Credit Agreement.

 

The terms of this Note are subject to amendment only in the manner provided in the Credit Agreement.

 

No reference herein to the Credit Agreement and no provision of this Note or the Credit Agreement shall alter or impair the obligations of Borrower, which are absolute and unconditional, to pay the principal of and interest on this Note at the place, at the respective times, and in the currency herein prescribed.

 

Borrower promises to pay all costs and expenses, including reasonable attorneys’ fees, all as provided in the Credit Agreement, incurred in the collection and enforcement of this Note.  Borrower and any endorsers of this Note hereby consent to renewals and extensions of time at or after the maturity hereof, without notice, and hereby waive diligence, presentment, protest, demand notice of every kind and, to the full extent permitted by law, the right to plead any statute of limitations as a defense to any demand hereunder.

 

[Remainder of page intentionally left blank]

 

 

 

 

  

EXHIBIT B-4-2

  

 

 

IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed and delivered by its officer thereunto duly authorized as of the date and at the place first written above.

 

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

 

 

 

 

 

 

  

EXHIBIT B-4-3

  

EXHIBIT C TO

CREDIT AND GUARANTY AGREEMENT

COMPLIANCE CERTIFICATE

 

THE UNDERSIGNED HEREBY CERTIFIES AS FOLLOWS:

1.      I am the Chief Financial Officer of each of RADNET, INC. (“Holdings”) and RADNET MANAGEMENT, INC. (“Borrower”).

 

2.      I have reviewed the terms of that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS7, as Documentation Agent, and I have made, or have caused to be made under my supervision, a review in reasonable detail of the transactions and condition of Borrower and its Subsidiaries during the accounting period covered by the attached financial statements.

 

3.      The examination described in paragraph 2 above did not disclose, and I have no knowledge of, the existence of any condition or event which constitutes an Event of Default or Default during or at the end of the accounting period covered by the attached financial statements or as of the date of this Certificate, except as set forth in a separate attachment, if any, to this Certificate, describing in detail, the nature of the condition or event, the period during which it has existed and the action which Borrower has taken, is taking, or proposes to take with respect to each such condition or event.

 

The foregoing certifications, together with the computations set forth in Annex A hereto and the financial statements delivered with this Certificate in support hereof, are made and delivered [mm/dd/yy] pursuant to Section 5.01(c) of the Credit Agreement.

 

	 	
RADNET, INC.

	 
	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	
Title: Chief Financial Officer

	 
	 	 	 	 

 

 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

EXHIBIT C-1

  

ANNEX A TO

COMPLIANCE CERTIFICATE

FOR THE FISCAL [QUARTER] [YEAR] ENDING [mm/dd/yy].

 

[To be conformed to final Credit Agreement]

	
1.  Consolidated Adjusted EBITDA: 1(i) - (ii) + (iii) =

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	
(i)

	
(a)

	
Consolidated Net Income:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(b)

	
consolidated interest expense:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(c)

	
provisions for taxes based on income:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(d)

	
total depreciation expense:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(e)

	
total amortization expense:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(f)

	
specified operating lease expenses to the extent that a specific

	  	  
	  	  	  	
operating lease has been terminated and converted to a capital

	  	  
	  	  	  	
lease or purchased for cash prior to the end of the term thereof

	  	  
	  	  	  	
(and during such measurement period):2

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(g)

	
pro forma cost savings relating to any Permitted Acquisition in an

	  	  
	  	  	  	
amount not to exceed $4,000,000 for any individual Permitted

	  	  
	  	  	  	
Acquisition and in an aggregate amount for all Permitted Acquisitions

	  	  
	  	  	  	
(in each case for the term of the Credit Agreement) not to exceed

	  	  
	  	  	  	
$20,000,000 to the extent permitted by clause (iii) of this item:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(h)

	
other non-Cash charges reducing

	  	  
	  	  	  	
Consolidated Net Income3 4:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(i)

	
Transaction Costs:

	  	
$[___,___,___]

	  	  	  	  	  	  
	  	  	
(j)

	
non-recurring employee severance expenses not to exceed

	  	  
	  	  	  	
$1,500,000 during any twelve-month period:

	  	
$[___,___,___]

 

	
1

	
Notwithstanding the following, the Consolidated Adjusted EBITDA for the fiscal quarters ended September 30, 2009, and December 31, 2009 shall be deemed to be $28,737 and $29,257, respectively, as such amount may be further adjusted with respect to events after the Closing Date pursuant to clause (i)(f) of this item and clause (iii) of this item.

	
2

	
With respect to any such terminated operating leases which have been so terminated on or prior to the Closing Date, for the fiscal quarters ended March 31, 2010 and June 30, 2010, such additional amounts shall be equal to $1,420,000 and $533,000, respectively.

	
3

	
Including non-Cash stock compensation expenses.

	
4

	
Excluding any such non-Cash charge to the extent that it represents an accrual or reserve for potential Cash charges in any future period or amortization of a prepaid Cash charge that was paid in a prior period.

 

EXHIBIT-C-A-1

 

 

	  	  	  	  	  	  
	  	  	
(k)

	
non-recurring, non-operational expenses (net of any non-recurring,

	  	  
	  	  	  	
non-operational income) reflected on the Consolidated

	  	  
	  	  	  	
Statements of Operations of Radnet, Inc. and its Subsidiaries under

	  	  
	 	 	 	
the heading “Other Expenses (Income)” not to exceed $3,000,000

	 	 
	 	 	 	
during any twelve-month period:

	 	
$[___,___,___]

	 	 	 	 	 	 
	 	
(ii)

	
other non-Cash gains increasing

	 	 
	 	 	Consolidated Net Income5 6	 	$[___,___,___]

                      

	
  

	
(iii)

	
With respect to any period during which a Permitted Acquisition or an Asset Sale has occurred (each, a “Subject Transaction”), for purposes of determining compliance with the financial covenants set forth in Section 6.07 of the Credit Agreement (but not for purposes of determining Applicable Revolving Commitment Fee Percentage), Consolidated Adjusted EBITDA shall be calculated with respect to such period on a pro forma basis (including pro forma adjustments arising out of events which are directly attributable to a specific transaction, are factually supportable and are expected to have a continuing impact, in each case determined on a basis consistent with Article 11 of Regulation S-X promulgated under the Securities Act and as interpreted by the staff of the SEC, which would include cost savings resulting from head count reduction, closure of facilities and similar restructuring charges, which pro forma adjustments shall be certified by the chief financial officer of Holdings) using the historical financial statements, audited or as otherwise acceptable to the Administrative Agent, of any business so acquired or to be acquired or sold or to be sold and the consolidated financial statements of Holdings and its Subsidiaries which shall be reformulated as if such Subject Transaction, had been consummated or incurred or repaid at the beginning of such period.7

 

	
2.  Consolidated Capital Expenditures:  (i) – (ii) =

	  
	  	
(i)

	
aggregate of all expenditures of Holdings and its Subsidiaries 

during such period (by the expenditure of cash or (without duplication),

the incurrence of Indebtedness) determined on a consolidated basis, for

any fixed asset or improvements or for replacements, substitutions or additions

thereto that, in accordance with GAAP, are required to be capitalized:

	  	$[___,___,___]
	 	 	 	 	 	 
	 	
(ii)

	
less, to the extent otherwise included in clause (i): (a) + (b) =  

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	(a) 	expenditures for replacements and substitutions for fixed

assets, capital assets or equipment to the extent made with

Net Cash Proceeds invested pursuant to Section 2.14(a)

or Section 2.14(b) of the Credit Agreement:                      

	 	$[___,___,___]

 

	
5

	
Excluding any such non-Cash gain to the extent it represents the reversal of an accrual or reserve for potential Cash gain in any prior period.

	
6

	
For the avoidance of doubt, regardless of whether any prepayment of Offer Loans pursuant to Section 2.13(c) of the Credit Agreement is deemed to result in a non-cash gain, no such gain shall increase Consolidated Adjusted EBITDA.

	
7

	
If items are added to Consolidated Adjusted EBITDA pursuant to this clause (iii), the components thereof should be itemized (as set forth in clauses (i) and (ii) of this item) for each such Permitted Acquisition or Asset Sale and provided in a separate attachment.  For the fiscal quarters ended March 31, 2010, June 30, 2010, September 30, 2010 and December 31, 2010, such pro forma adjustments with respect to acquisitions consummated prior to the Closing Date and the Related Acquisitions shall be equal to $9,874,000, $6,599,000, $3,930,000 and $1,676,000, respectively.

 

  

EXHIBIT-C-A-2

  

 

 

	 	 	 	 	 	 
	 	 	(b)	expenditures which constitute a Permitted Acquisition permitted

under Section 6.08 of the Credit Agreement:  

	 	$[___,___,___]

 

	

3.  Consolidated Cash Interest Expense:  (i) – (ii) =

	  
	  	
(i)

	
total interest expense (including that portion attributable to Capital Leases 

in accordance with GAAP and capitalized interest) of Holdings and

its Subsidiaries on a consolidated basis with respect to all outstanding

Indebtedness of Holdings and its Subsidiaries, including all commissions,

discounts and other fees and charges owed with respect to letters of credit

and net costs under Interest Rate Agreements:   

	  	$[___,___,___]
	 	 	 	 	 	 
	 	
(ii)

	
less: (a) + (b) =

	 	 
	 	 	 	 	 	 
	 	 	(a) 	any amount not payable in Cash in such period:                   	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	(b)	any amounts referred to in Section 2.11(d) or (e) of the Credit

Agreement payable on or before the Closing Date:   

	 	$[___,___,___]

 

	

4.  Consolidated Current Assets:

	  
	 	 
	  	
(i)

	

total assets of a Person and its Subsidiaries on a consolidated basis that

may properly be classified as current assets in conformity with GAAP,

excluding Cash and Cash Equivalents:

	  	$[___,___,___]
	 	 	 	 	 	 
	
5.  Consolidated Current Liabilities:

	 	 
	 	 	 	 	 	 
	 	 	
total liabilities of a Person and its Subsidiaries on a consolidated basis

that may properly be classified as current liabilities in conformity with

GAAP, excluding the current portion of long term debt: 

	 	$[___,___,___]
	 	 	 	 	 	 
	6.  Consolidated Excess Cash Flow: (i) - (ii) =     	 	 
	 	 	 	 	 	 
	 	(i)	(a)	Consolidated Net Income: 	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	(b) 	to the extent reducing Consolidated Net Income, the sum, without

duplication, of amounts for non-Cash charges reducing Consolidated

Net Income, including for depreciation and amortization (excluding

any such non-Cash charge to the extent that it represents an accrual

or reserve for potential Cash charge in any future period or amortization

of a prepaid Cash charge that was paid in a prior period): 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	(c) 	Consolidated Working Capital Adjustment: 	 	$[___,___,___]
	 	 	 	 	 	 
	 	(ii)8 	less: (a) + (b) =	 	 
	 	 	 	 	 	 
	 	 	(a)	 the amounts for such period paid in cash from operating cash flow of

(1) scheduled repayments of Indebtedness for borrowed money (excluding

repayments of Revolving Loans or Swing Line Loans except to the extent

the Revolving Commitments are permanently reduced in connection with

such repayments) and scheduled repayments of obligations under Capital

Leases (excluding any interest expense portion thereof), (2) Consolidated

Capital Expenditures, and (3) Permitted Acquisitions (including

transaction costs with respect thereto): 

	 	$[___,___,___]

 

	
8

	
For the avoidance of doubt, no prepayment of Offer Loans pursuant to Section 2.13(c) of the Credit Agreement shall reduce the calculation of Consolidated Excess Cash Flow pursuant to this item (ii) of the calculation of Consolidated Excess Cash Flow.

  

EXHIBIT-C-A-3

  

 

	 	 	 	 	 	 
	 	 	(b)  	other non-Cash gains increasing Consolidated Net Income for such period

(excluding any such non-Cash gain to the extent it represents the reversal

of an accrual or reserve for potential Cash gain in any prior period): 

	 	$[___,___,___]
	 	 	 	 	 	 
	
7.  Consolidated Net Income: (i) - (ii) =

	 	$[___,___,___]
	 	 	 	 	 	 
	 	
(i)

	 	
the net income (or loss) of Holdings and its Subsidiaries 

on a consolidated basis for such period taken as a single

accounting period determined in conformity with GAAP: 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	
(ii) 

	

(a)

	
the income (or loss) of any Person 

(other than a Subsidiary of Holdings)

in which any other Person

(other than Holdings or any of its Subsidiaries)

has a joint interest, except to the extent of

the amount of dividends or other distributions

actually paid to Holdings or

any of its Subsidiaries by such Person:

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	
(b)

	
the income (or loss) of any Person accrued

prior to the date it becomes a Subsidiary of

Holdings or is merged into or consolidated

with Holdings or any of its Subsidiaries or that

Person’s assets are acquired by Holdings

or any of its Subsidiaries: 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	
(c)

	
the income of any Subsidiary of Holdings 

to the extent that the declaration or payment

of dividends or similar distributions by that

Subsidiary of that income is not at the time

permitted by operation of the terms of its charter

or any agreement, instrument, judgment, decree,

order, statute, rule or governmental regulation

applicable to that Subsidiary: 

	 	$[___,___,___]
	 	 	 	 	 	 

 

  

EXHIBIT-C-A-4

  

 

 

	 	 	
(d)

	
any after-tax gains or losses attributable to 

Asset Sales or returned surplus assets

of any Pension Plan: 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	
(e)

	
to the extent not included in clauses (ii)(a)  

through (d) above, any net extraordinary

gains or net extraordinary losses:    

	 	$[___,___,___]
	 	 	 	 	 	 
	
8.  Consolidated Total Debt:  (i) – (ii) =

	 
	 	 	 	 	 
	 	(i) 	 	the aggregate stated balance sheet amount of all Indebtedness of Holdings 

and its Subsidiaries (or, if higher, the par value or stated face amount of

all such Indebtedness (other than zero coupon Indebtedness)), determined

on a consolidated basis in accordance with GAAP: 

	$[___,___,___]

  

	 	(ii)	 	up to $25,000,000 in Cash or Cash Equivalents included in the consolidated

balance sheet of Holdings and its Subsidiaries and subject to a Deposit Account

Control Agreement or Securities Account Control Agreement, as applicable: 

	 	$[___,___,___]
	 	 	 	 	 	 
	
9.  Consolidated Working Capital: (i) - (ii) =

	 	$[___,___,___]
	 	 	 	 	 	 
	 	
(i)

	Consolidated Current Assets:	 	$[___,___,___]
	 	 	 	 	 	 
	 	
(ii) 

	Consolidated Current Liabilities:	 	$[___,___,___]
	 	 	 	 	 	 
	10.  Consolidated Working Capital Adjustment9 (i) - (ii) =	 	$[___,___,___]
	 	 	 	 	 	 
	 	
(i)

	 	
Consolidated Working Capital

as of the beginning of such period:

	 	$[___,___,___]
	 	 	 	 	 	 
	 	(ii) 	 	Consolidated Working Capital 

as of the end of such period:

	 	$[___,___,___]
	 	 	 	 	 	 
	
11.  Interest Coverage Ratio: (i)/(ii) =

	 	 
	 	 	 	 	 	 
	 	
(i)

	 	
Consolidated Adjusted EBITDA

for the four-Fiscal Quarter Period then ended: 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	
(ii)

	 	
Consolidated Cash Interest Expense

for such four-Fiscal Quarter Period: 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	 	 	Actual:	_.__:1.00
	 	 	 	 	Required:	_.__:1.00
	 	 	 	 	 	 

 

 

	
9

	
In calculating the Consolidated Working Capital Adjustment there shall be excluded the effect of reclassification during such period of current assets to long term assets and current liabilities to long term liabilities and the effect of any Permitted Acquisition during such period; provided, that there shall be included with respect to any Permitted Acquisition during such period an amount (which may be a negative number) by which the Consolidated Working Capital acquired in such Permitted Acquisition as at the time of such acquisition exceeds (or is less than) Consolidated Working Capital at the end of such period.

  

EXHIBIT-C-A-5

  

 

 

	
12.  Leverage Ratio: (i)/(ii) =

	 	 
	 	 	 	 	 	 
	 	(i) 	Consolidated Total Debt 	 	$[___,___,___]
	 	 	 	 	 
	 	
(ii) 

	
Consolidated Adjusted EBITDA 

for the four-Fiscal Quarter period then ended: 

	 	$[___,___,___]
	 	 	 	 	 	 
	 	 	 	 	Actual:	_.__:1.00
	 	 	 	 	Required:	_.__:1.00
	 	 	 	 	 	 
	
13.  Maximum Consolidated Capital Expenditures:

	 	 
	 	 	 	 	 	 
	 	 	 	 	Actual: 	$[___,___,___]
	 	 	 	 	 	 
	 	
plus, the excess, if any, of such amount for the previous Fiscal Year

over the actual amount of Consolidated Capital Expenditures

for such previous Fiscal Year: 

	 	$[___,___,___]
	 	 	 	 
	 	 	Required:	$[___,___,___]

 

 

 

  

EXHIBIT-C-A-6

  

 

EXHIBIT D-1 TO

CREDIT AND GUARANTY AGREEMENT

OPINION OF SHEPPARD, MULLIN, RICHTER & HAMPTON

 

[TO COME]

 

 

 

 

 

  

  

  

EXHIBIT D-2 TO

CREDIT AND GUARANTY AGREEMENT

OPINION OF JEFF LINDEN

 

[TO COME]

 

 

  

  

  

EXHIBIT E TO

CREDIT AND GUARANTY AGREEMENT

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

This Assignment and Assumption Agreement (the “Assignment”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as it may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto (the “Standard Terms and Conditions”) are hereby agreed to and incorporated herein by reference and made a part of this Assignment as if set forth herein in full.

 

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including any letters of credit and swingline loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as the “Assigned Interest”). Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and the Credit Agreement, without representation or warranty by the Assignor.

 

	
1.

	
Assignor:

	
______________________

	 	 	 
	
2.

	
Assignee:

	
______________________ [and is an Affiliate/Approved Fund17]

	 	 	 
	
3.

	
Borrower:

	
RadNet Management, Inc.

	 	 	 
	
4.

	
Administrative Agent:

	
Barclays Bank PLC, as the administrative agent under the Credit Agreement

	 	 	 
	
5.

	
Credit Agreement:

	
The $385,000,000.00 Credit and Guaranty Agreement dated as of April 6, 2010 among RadNet Management, Inc., RadNet, Inc., the Lenders parties thereto, Barclays Bank PLC, as Administrative Agent, and the other agents parties thereto

	 	 	 
	
6.

	
Assigned Interest:

 

	
 

 

Facility Assigned

	
 

Aggregate Amount of

Commitment/Loans

for all Lenders

	
 

Amount of Commitment/Loans

Assigned

	
 

Percentage Assigned of Commitment/Loans2

	
Tranche B Term Loans

	
$285,000,000.00

	
$______________

 

	
____________%

	
Revolving Loans

	
$100,000,000.00

	
$______________

 

	
____________%

 

  

1 Select as applicable

2 Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

  

EXHIBIT E-1

  

Effective Date: ______________, 20__ [TO BE INSERTED BY ADMINISTRATIVE  AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The Assignee agrees to deliver to the Administrative Agent a completed administrative questionnaire in which the Assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Loan Parties and their related parties or their respective securities) will be made available and who may receive such information in accordance with the Assignee’s compliance procedures and applicable laws, including Federal and state securities laws.

 

 

 

 

 

  

EXHIBIT E-2

  

 

The terms set forth in this Assignment are hereby agreed to:

 

 

	 	

ASSIGNOR

[NAME OF ASSIGNOR]

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	Title 	 
	 	 	 	 
	 	 	
ASSIGNEE

[NAME OF ASSIGNEE]

	 
	 	 	 	 
	 	
By: 

	/s/ 	 
	 	Title 	 

Consented to and Accepted:

	BARCLAYS BANK PLC, as 

   Administrative Agent

	 
	 	 	 
	
By: 

	/s/ 	 
	Title 	 
	 	 	 
	
[Consented to:

	 
	 	 	 
	
RADNET MANAGEMENT, INC.

	 
	 	 	 
	
By: 

	/s/ 	 
	Title: ]3	 

  

 

 

3 To be added only if the consent of the Borrower is required for the applicable assignment by the terms of the Credit Agreement.

 

  

EXHIBIT-E-3

  

ANNEX 1

 

The $385,000,000 Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS20, as Documentation Agent.  Capitalized terms used but not defined herein have the meanings given to them in the Credit Agreement.

 

STANDARD TERMS AND CONDITIONS FOR ASSIGNMENT

 

AND ASSUMPTION AGREEMENT

 

1.           Representations and Warranties.

 

1.1           Assignor. The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of any Borrower, any Subsidiary or Affiliate thereof or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by any Borrower, any Subsidiary or Affiliate thereof or any other Person of any of their respective obligations under any Loan Document.

 

1.2.           Assignee. The Assignee (a) repeats each Lender acknowledgment set forth in Section 9.05 of the Credit Agreement; (b) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it satisfies the requirements specified in the Credit Agreement that are required to be satisfied by it in order to acquire the Assigned Interest and become a Lender and upon becoming a Lender as of the Effective Date, it is not a Defaulting Lender, (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it has received and/or had the opportunity to review a copy of the Credit Agreement to the extent it has in its sole discretion deemed necessary, together with copies of the most recent financial statements delivered pursuant to Section 5.01 thereof, as applicable, and such other documents and information as it has in its sole discretion deemed appropriate to make its own credit analysis and decision to enter into this Assignment and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, and (v) if it is a Non-US Lender, attached to the Assignment is any documentation required to be delivered by it pursuant to the terms of the Credit Agreement, duly completed and executed by the Assignee; (c) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender; and (d) appoints and authorizes (i) the Administrative Agent and (ii) the Collateral Agent to take such action as agent in their respective capacities on its behalf and to exercise such powers and discretion under the Credit Agreement, the other Loan Documents and any other instrument or document furnished pursuant hereto or thereto as are delegated to the Administrative Agent and the Collateral Agent, as applicable, by the terms thereof, together with such powers as are incidental thereto.

 

 

4 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT-E-4

  

 

2.           Payments.  From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to but excluding the Effective Date and to the Assignee for amounts which have accrued from and after the Effective Date.

 

3.           General Provisions. This Assignment shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment by telecopy shall be effective as delivery of a manually executed counterpart of this Assignment.  This Assignment and the rights and obligations of the parties under this Assignment shall be governed by, and construed and interpreted in accordance with, the law of the State of New York without regard to principles of conflicts of laws that would result in the application of any law other than the law of the State of New York.

 

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EXHIBIT-E-5

  

EXHIBIT F TO

CREDIT AND GUARANTY AGREEMENT

CERTIFICATE RE NON-BANK STATUS

 

Reference is made to the Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1,  as Documentation Agent.  Pursuant to Section 2.20(c) of the Credit Agreement, the undersigned hereby certifies that it is not a “bank” or other Person described in Section 881(c)(3) of the Internal Revenue Code of 1986, as amended.

	 	
[NAME OF LENDER]

	 
	 	 	 	 
	 	
By: 

	/s/ 	 
	 	 	
Name:

	 
	 	 	Title:	 
	 	 	 	 

 

 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

  

  

EXHIBIT G-1 TO

CREDIT AND GUARANTY AGREEMENT

CLOSING DATE CERTIFICATE

 

THE UNDERSIGNED HEREBY CERTIFY AS FOLLOWS:

1.  We are, respectively, the chief executive officer and the chief financial officer of RADNET, INC. (“Holdings”) and RADNET MANAGEMENT, INC. (“Borrower”).

 

2.  We have reviewed the terms of Section 3 of the Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent, and the definitions and provisions contained in such Credit Agreement relating thereto, and in our opinion we have made, or have caused to be made under our supervision, such examination or investigation as is necessary to enable us to express an informed opinion as to the matters referred to herein.

 

3.  Based upon our review and examination described in paragraph 2 above, we certify, on behalf of Borrower, that as of the date hereof:

 

(i)            since December 31, 2009, there has not occurred a Material Adverse Effect; and

 

(ii)           each of the conditions precedent described in Section 3.01 and Section 3.02 of the Credit Agreement have been satisfied on the Closing Date (except that no opinion is hereby expressed as to any Agent’s or Required Lenders’ satisfaction with any document, instrument or other matter).

 

The foregoing certifications are made and delivered as of April 6, 2010.

 

	 	
RADNET, INC.

RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	
Name:

	 
	 	 	
Title: Chief Executive Officer

	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	
Name:

	 
	 	 	
Title: Chief Executive Officer

	 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

EXHIBIT G-1-1

  

EXHIBIT G-2 TO

CREDIT AND GUARANTY AGREEMENT

SOLVENCY CERTIFICATE

 

THE UNDERSIGNED HEREBY CERTIFIES AS FOLLOWS:

 

1.  I am the chief financial officer of RADNET, INC., a Delaware corporation (“Holdings”) and RADNET MANAGEMENT, INC., a California corporation (“Borrower”).

 

2.  Reference is made to that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent.

 

3.  I  have reviewed the terms of Sections 3 and 4 of the Credit Agreement and the definitions and provisions contained in the Credit Agreement relating thereto, and, in my opinion, have made, or have caused to be made under my supervision, such examination or investigation as is necessary to enable me to express an informed opinion as to the matters referred to herein.

 

4.  Based upon my review and examination described in paragraph 3 above, I certify that as of the date hereof, after giving effect to the consummation of the Transactions, the related financings and the other transactions contemplated by the Loan Documents, the Loan Parties, taken as a whole, are Solvent.

 

The foregoing certifications are made and delivered as of April 6, 2010.

 

 

	
 

	
 

	 	 
	 	 	Name:	 
	 	 	
Title: Chief Financial Officer

	 
	 	 	 	 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

EXHIBIT G-2-1

  

EXHIBIT H TO

CREDIT AND GUARANTY AGREEMENT

COUNTERPART AGREEMENT

 

This COUNTERPART AGREEMENT, dated [mm/dd/yy] (this “Counterpart Agreement”) is delivered pursuant to that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent.

 

Section 1.  Pursuant to Section 5.10 of the Credit Agreement, the undersigned hereby:

 

(a)           agrees that this Counterpart Agreement may be attached to the Credit Agreement and that by the execution and delivery hereof, the undersigned becomes a Guarantor under the Credit Agreement and agrees to be bound by all of the terms thereof;

 

(b)           represents and warrants that each of the representations and warranties set forth in the Credit Agreement and each other Loan Document and applicable to the undersigned is true and correct both before and after giving effect to this Counterpart Agreement, except to the extent that any such representation and warranty relates solely to any earlier date, in which case such representation and warranty is true and correct as of such earlier date;

 

(c)           no event has occurred or is continuing as of the date hereof, or will result from the transactions contemplated hereby on the date hereof, that would constitute an Event of Default or a Default;

 

(d)           agrees to irrevocably and unconditionally guaranty the due and punctual payment in full of all Obligations when the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)) and in accordance with Article VII of the Credit Agreement; and

 

(e)           the undersigned hereby (i) agrees that this counterpart may be attached to the Pledge and Security Agreement, (ii) agrees that the undersigned will comply with all the terms and conditions of the Pledge and Security Agreement as if it were an original signatory thereto, (iii) grants to Collateral Agent a security interest in all of the undersigned’s right, title and interest in and to all “Collateral” (as such term is defined in the Pledge and Security Agreement) of the undersigned, subject to the terms of Section 2 of the Pledge and Security Agreement, in each case whether now or hereafter existing or in which the undersigned now has or hereafter acquires an interest and wherever the same may be located and (iv) delivers to Collateral Agent supplements to all schedules attached to the Pledge and Security Agreement.  All such Collateral shall be deemed to be part of the “Collateral” and hereafter subject to each of the terms and conditions of the Pledge and Security Agreement.

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT-H-1

  

 

 

Section 2.  The undersigned agrees from time to time, upon request of Administrative Agent, to take such additional actions and to execute and deliver such additional documents and instruments as Administrative Agent  may request to effect the transactions contemplated by, and to carry out the intent of, this Agreement.  Neither this Agreement nor any term hereof may be changed, waived, discharged or terminated, except by an instrument in writing signed by the party (including, if applicable, any party required to evidence its consent to or acceptance of this Agreement) against whom enforcement of such change, waiver, discharge or termination is sought.  Any notice or other communication herein required or permitted to be given shall be given pursuant to Section 10.01 of the Credit Agreement, and for all purposes thereof, the notice address of the undersigned shall be the address as set forth on the signature page hereof.  In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

 

THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.

 

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EXHIBIT-H-2

  

IN WITNESS WHEREOF, the undersigned has caused this Counterpart Agreement to be duly executed and delivered by its duly authorized officer as of the date above first written.

 

	 	
[NAME OF SUBSIDIARY]

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

Address for Notices:

______________

______________

______________

Attention:

Telecopier

with a copy to:

______________

______________

______________

Attention:

Telecopier

ACKNOWLEDGED AND ACCEPTED,

as of the date above first written:

BARCLAYS BANK PLC,

as Administrative Agent and Collateral Agent

 

	
By: 

	/s/ 	 
	Name 	 
	Title 	 
	 	 	 

  

EXHIBIT-H-3

  

EXHIBIT I TO

CREDIT AND GUARANTY AGREEMENT

[PLEDGE AND SECURITY AGREEMENT TO BE PROVIDED SEPARATELY]

 

 

  

  

  

EXHIBIT J TO

CREDIT AND GUARANTY AGREEMENT

	
 

RECORDING REQUESTED BY:

Latham & Watkins LLP

 

AND WHEN RECORDED MAIL TO:

 

Latham & Watkins LLP

885 Third Avenue

New York, New York 10022

Attn: Melissa S. Alwang, Esq.

 

Re:  RADNET MANAGEMENT, INC.

	  

Space above this line for recorder’s use only

LANDLORD WAIVER AND CONSENT AGREEMENT

This LANDLORD WAIVER AND CONSENT AGREEMENT (this “Agreement”) is dated as of  [mm/dd/yy] and entered into by [NAME OF LANDLORD] (“Landlord”), to and for the benefit of BARCLAYS BANK PLC, as collateral agent for Lenders and Lender Counterparties (in such capacity “Collateral Agent”).

 

RECITALS:

 

WHEREAS, [NAME OF GRANTOR], a [Type of Person] (“Tenant”), has possession of and occupies all or a portion of the property described on Exhibit A annexed hereto (the “Premises”);

 

WHEREAS, Tenant’s interest in the Premises arises under the lease agreement (the “Lease”) more particularly described on Exhibit B annexed hereto, pursuant to which Landlord has rights, upon the terms and conditions set forth therein, to take possession of, and otherwise assert control over, the Premises;

 

WHEREAS, reference is made to that certain Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, supplemented or otherwise modified, the “Credit Agreement”; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent, pursuant to which Tenant has executed a security agreement, mortgages, deeds of trust, deeds to secure debt and assignments of rents and leases, and other collateral documents in relation to the Credit Agreement;

 

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT-J-1

  

 

WHEREAS, Tenant’s repayment of the extensions of credit made by Lenders under the Credit Agreement will be secured, in part, by all Inventory of Tenant (including all Inventory of Tenant now or hereafter located on the Premises (the “Subject Inventory”)) and all Equipment used in Tenant’s business (including all Equipment of Tenant now or hereafter located on the Premises (the “Subject Equipment”; and, together with the Subject Inventory, the “Collateral”)); and

 

WHEREAS, Collateral Agent has requested that Landlord execute this Agreement as a condition to the extension of credit to Tenant under the Credit Agreement.

 

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord hereby represents and warrants to, and covenants and agrees with, Collateral Agent as follows:

 

1.  Landlord hereby (a) waives and releases unto Collateral Agent and its successors and assigns any and all rights granted by or under any present or future laws to levy or distraint for rent or any other charges which may be due to Landlord against the Collateral, and any and all other claims, liens and demands of every kind which it now has or may hereafter have against the Collateral, and (b) agrees that any rights it may have in or to the Collateral, no matter how arising (to the extent not effectively waived pursuant to clause (a) of this paragraph 1), shall be second and subordinate to the rights of Collateral Agent in respect thereof.  Landlord acknowledges that the Collateral is and will remain personal property and not fixtures even though it may be affixed to or placed on the Premises.

 

2.  Landlord certifies that (a) Landlord is the landlord under the Lease, (b) the Lease is in full force and effect and has not been amended, modified, or supplemented except as set forth on Exhibit B annexed hereto, (c) to the knowledge of Landlord, there is no defense, offset, claim or counterclaim by or in favor of Landlord against Tenant under the Lease or against the obligations of Landlord under the Lease, (d) no notice of default has been given under or in connection with the Lease which has not been cured, and Landlord has no knowledge of the occurrence of any other default under or in connection with the Lease, and (e) except as disclosed to Collateral Agent, no portion of the Premises is encumbered in any way by any deed of trust or mortgage lien or ground or superior lease.

 

3.  Landlord consents to the installation or placement of the Collateral on the Premises, and Landlord grants to Collateral Agent a license to enter upon and into the Premises to do any or all of the following with respect to the Collateral:  assemble, have appraised, display, remove, maintain, prepare for sale or lease, repair, transfer, or sell (at public or private sale).  In entering upon or into the Premises, Collateral Agent hereby agrees to indemnify, defend and hold Landlord harmless from and against any and all claims, judgments, liabilities, costs and expenses incurred by Landlord caused solely by Collateral Agent’s entering upon or into the Premises and taking any of the foregoing actions with respect to the Collateral.  Such costs shall include any damage to the Premises made by Collateral Agent in severing and/or removing the Collateral therefrom.

 

  

EXHIBIT-J-2

  

 

 

4.  Landlord agrees that it will not prevent Collateral Agent or its designee from entering upon the Premises at all reasonable times to inspect or remove the Collateral.  In the event that Landlord has the right to, and desires to, obtain possession of the Premises (either through expiration of the Lease or termination thereof due to the default of Tenant thereunder), Landlord will deliver notice (the “Landlord’s Notice”) to Collateral Agent to that effect.  Within the 45 day period after Collateral Agent receives the Landlord’s Notice, Collateral Agent shall have the right, but not the obligation, to cause the Collateral to be removed from the Premises.  During such 45 day period, Landlord will not remove the Collateral from the Premises nor interfere with Collateral Agent’s actions in removing the Collateral from the Premises or Collateral Agent’s actions in otherwise enforcing its security interest in the Collateral.  Notwithstanding anything to the contrary in this paragraph, Collateral Agent shall at no time have any obligation to remove the Collateral from the Premises.

 

5.  Landlord shall send to Collateral Agent a copy of any notice of default under the Lease sent by Landlord to Tenant.  In addition, Landlord shall send to Collateral Agent a copy of any notice received by Landlord of a breach or default under any other lease, mortgage, deed of trust, security agreement or other instrument to which Landlord is a party which may affect Landlord’s rights in, or possession of, the Premises.

 

6.  All notices to Collateral Agent under this Agreement shall be in writing and sent to Collateral Agent at its address set forth on the signature page hereof by telefacsimile, by United States mail, or by overnight delivery service.

 

7.  The provisions of this Agreement shall continue in effect until Landlord shall have received Collateral Agent’s written certification that all amounts advanced under the Credit Agreement have been paid in full.

 

8.  This Agreement and the rights and obligations of the parties hereunder shall be governed by, and shall be construed and enforced in accordance with, the internal laws of the State of New York, without regard to conflicts of laws principles.

 

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EXHIBIT-J-3

  

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly executed and delivered as of the day and year first set forth above.

 

	 	
[NAME OF LANDLORD]

	 
	 	 	 	 
	
Date

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	
Attention:

	 
	 	 	
Telecopier:

	 

By its acceptance hereof, as of the day and year first set forth above, Collateral Agent agrees to be bound by the provisions hereof.

 

	 	
BARCLAYS BANK PLC,

as Collateral Agent

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	
Attention:

	 
	 	 	
Telecopier:

	 

[APPROPRIATE NOTARY BLOCKS]

  

EXHIBIT-J-4

  

EXHIBIT A TO

LANDLORD WAIVER AND CONSENT

Legal Description of Premises:

  

EXHIBIT-J-A-1

  

EXHIBIT B TO

LANDLORD WAIVER AND CONSENT

Description of Lease:

  

EXHIBIT-J-B-1

  

EXHIBIT K TO

CREDIT AND GUARANTY AGREEMENT

INTERCOMPANY NOTE

Note Number: 1                                                      Dated:  [__________], 20[_]

 

FOR VALUE RECEIVED, each of Holdings, the Borrower and each of its Affiliates and Subsidiaries (collectively, the “Group Members” and each, a “Group Member”) which is a party to this intercompany note (the “Promissory Note”) promises to pay to the order of such other Group Member as makes loans to such Group Member (each Group Member which borrows money pursuant to this Promissory Note is referred to herein as a “Payor” and each Group Member which makes loans and advances pursuant to this Promissory Note is referred to herein as a “Payee”), on demand, in lawful money of the United States of America, in immediately available funds and at the appropriate office of the Payee, the aggregate unpaid principal amount of all loans and advances heretofore and hereafter made by such Payee to such Payor and any other indebtedness now or hereafter owing by such Payor to such Payee as shown either on Schedule A attached hereto (and any continuation thereof) or in the books and records of such Payee.  The failure to show any such Indebtedness or any error in showing such Indebtedness shall not affect the obligations of any Payor hereunder.  Capitalized terms used herein but not otherwise defined herein shall have the meanings given such terms in the Credit and Guaranty Agreement, dated as of April 6, 2010 (as amended, supplemented, replaced or otherwise modified from time to time, the “Credit Agreement”), by and among RADNET MANAGEMENT, INC., RADNET, INC., certain Subsidiaries and Affiliates of Borrower, as Guarantors, the Lenders party thereto from time to time, DEUTSCHE BANK SECURITIES INC. and GENERAL ELECTRIC CAPITAL CORPORATION, as Co-Syndication Agents, BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1, as Documentation Agent.

 

The unpaid principal amount hereof from time to time outstanding shall bear interest at a rate equal to the rate as may be agreed upon in writing from time to time by the relevant Payor and Payee or, at the Administrative Agent’s option following the occurrence and during the continuation of an Event of Default, at the rate per annum then applicable to Revolving Loans that are Base Rate Loans or, following expiration or termination of the Revolving Commitments, the rate applicable to Base Rate Loans thereunder immediately prior to such expiration or termination, in each case, plus 2.0% per annum.  Interest shall be due and payable on the last day of each month commencing after the date hereof or at such other times as may be agreed upon in writing from time to time by the relevant Payor and Payee.  Upon demand for payment of any principal amount hereof, accrued but unpaid interest on such principal amount shall also be due and payable.  Interest shall be paid in lawful money of the United States of America and in immediately available funds.  Interest shall be computed for the actual number of days elapsed on the basis of a year consisting of 365 days.

 

Each Payor and any endorser of this Promissory Note hereby waives presentment, demand, protest and notice of any kind.  No failure to exercise, and no delay in exercising, any rights hereunder on the part of the holder hereof shall operate as a waiver of such rights.

 

This Promissory Note has been pledged by each Payee to the Collateral Agent, for the benefit of the Secured Parties, as security for such Payee’s Obligations, if any, under the Credit Agreement, the Pledge and Security Agreement and the other Loan Documents to which such Payee is a party.  Each Payor acknowledges and agrees that the Collateral Agent and the other Secured Parties may exercise all the rights of the Payees under this Promissory Note and will not be subject to any abatement, reduction, recoupment, defense, setoff or counterclaim available to such Payor.

 

Each Payee agrees that any and all claims of such Payee against any Payor or any endorser of this Promissory Note, or against any of their respective properties, shall be subordinate and subject in right of payment to the Obligations until all of the Obligations have been performed and paid in full in immediately available funds, no Letters of Credit are outstanding and the Commitments have been terminated; provided, that each Payor may make payments to the applicable Payee so long as no Default or Event of Default shall have occurred and be continuing; and provided, further, that all loans and advances made by a Payee pursuant to this Promissory Note shall be received by the applicable Payor subject to the provisions of the Credit Agreement including, without limitation, the provisions thereof relating to mandatory prepayment.  Notwithstanding any right of any Payee to ask, demand, sue for, take or receive any payment from any Payor, all rights, Liens and security interests of such Payee, whether now or hereafter arising and howsoever existing, in any assets of any Payor (whether constituting part of the security or collateral given to the Collateral Agent or any Secured Party to secure payment of all or any part of the Obligations or otherwise) shall be and hereby are subordinated to the rights of the Collateral Agent or any Secured Party in such assets.  Except as expressly permitted by the Credit Agreement, the Payees shall have no right to possession of any such asset or to foreclose upon, or exercise any other remedy in respect of, any such asset, whether by judicial action or otherwise, unless and until all of the Obligations shall have been performed and paid in full in immediately available funds, no Letters of Credit are outstanding and the Commitments under the Credit Agreement have been terminated.

 

 

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

 

  

EXHIBIT-K-1

  

 

If all or any part of the assets of any Payor, or the proceeds thereof, are subject to any distribution, division or application to the creditors of any Payor, whether partial or complete, voluntary or involuntary, and whether by reason of liquidation, bankruptcy, arrangement, receivership, assignment for the benefit of creditors or any other action or proceeding, or if the business of any Payor is dissolved or if (except as expressly permitted by the Credit Agreement) all or substantially all of the assets of any Payor are sold, then, and in any such event, any payment or distribution of any kind or character, whether in cash, securities or other investment property, or otherwise, which shall be payable or deliverable upon or with respect to any indebtedness of such Payor to any Payee (“Payor Indebtedness”) shall be paid or delivered directly to the Collateral Agent for application to any of the Obligations, due or to become due, until the date on which the Obligations shall have been performed and paid in full in immediately available funds, no Letters of Credit shall be outstanding and the Commitments shall have been terminated.  Each Payee irrevocably authorizes, empowers and appoints the Collateral Agent as such Payee’s attorney-in-fact (which appointment is coupled with an interest and is irrevocable) to demand, sue for, collect and receive every such payment or distribution and give acquittance therefor and to make and present for and on behalf of such Payee such proofs of claim and take such other action, in the Collateral Agent’s own name or in the name of such Payee or otherwise, as the Collateral Agent may deem necessary or advisable for the enforcement of this Promissory Note.  Each Payee also agrees to execute, verify, deliver and file any such proofs of claim in respect of the Payor Indebtedness requested by the Collateral Agent.  The Collateral Agent may vote such proofs of claim in any such proceeding (and the applicable Payee shall not be entitled to withdraw such vote), receive and collect any and all dividends or other payments or disbursements made on Payor Indebtedness in whatever form the same may be paid or issued and apply the same on account of any of the Obligations.  Except as otherwise expressly permitted under the Credit Agreement, should any payment, distribution, security or other investment property or instrument or any proceeds thereof be received by any Payee upon or with respect to Payor Indebtedness owing to such Payee prior to such time as the Obligations have been performed and paid in full in immediately available funds, no Letters of Credit are outstanding and the Commitments have been terminated, such Payee shall receive and hold the same in trust, as trustee, for the benefit of the Collateral Agent and the Secured Parties, and shall forthwith deliver the same to the Collateral Agent, for the benefit of the Secured Parties, in precisely the form received (except for the endorsement or assignment of such Payee where necessary or advisable in the Collateral Agent’s judgment), for application to any of the Obligations, due or not due, and, until so delivered, the same shall be segregated from the other assets of such Payee and held in trust by such Payee as the property of the Collateral Agent, for the benefit of the Secured Parties.  If such Payee fails to make any such endorsement or assignment to the Collateral Agent, the Collateral Agent or any of its officers, employees or representatives are hereby irrevocably authorized to make the same.  Each Payee agrees that until the Obligations have been performed and paid in full in immediately available funds, no Letters of Credit are outstanding and the Commitments have been terminated, such Payee will not (i) assign or transfer, or agree to assign or transfer, to any Person (other than in favor of the Collateral Agent for the benefit of the Secured Parties pursuant to the Pledge and Security Agreement or otherwise) any claim such Payee has or may have against any Payor, (ii) discount or extend the time for payment of any Payor Indebtedness, or (iii) otherwise amend, modify, supplement, waive or fail to enforce any provision of this Promissory Note.

 

  

EXHIBIT-K-2

  

 

 

Notwithstanding anything to the contrary contained herein, in any other Loan Document or in any such promissory note or other instrument, this Promissory Note (i) replaces and supersedes any and all promissory notes or other instruments which create or evidence any loans or advances made on or before the date hereof by any Group Member to any other Group Member, and (ii) shall not be deemed replaced, superseded or in any way modified by any promissory note or other instrument entered into on or after the date hereof which purports to create or evidence any loan or advance by any Group Member to any other Group Member.

 

THIS PROMISSORY NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

From time to time after the date hereof, additional Subsidiaries of the Group Members may become parties hereto by executing a counterpart signature page to this Promissory Note (each additional Subsidiary, an “Additional Payor”).  Upon delivery of such counterpart signature page to the Payees, notice of which is hereby waived by the other Payors, each Additional Payor shall be a Payor and shall be as fully a party hereto as if such Additional Payor were an original signatory hereof.  Each Payor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Payor hereunder.  This Promissory Note shall be fully effective as to any Payor that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Payor hereunder.

 

This Promissory Note may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

 

[Remainder of page intentionally left blank]

 

 

 

 

 

  

EXHIBIT-K-3

  

IN WITNESS WHEREOF, each Payor has caused this Intercompany Note to be executed and delivered by its proper and duly authorized officer as of the date set forth above.

 

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

	 	
RADNET, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

	 	
[GROUP MEMBERS]

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

  

EXHIBIT-K-4

  

SCHEDULE A

 

TRANSACTIONS ON

 

INTERCOMPANY NOTE

 

	
Date

	
Name of 

Payor

	
Name of 

Payee

	
Amount of 

Advance This Date

	
Amount of 

Principal

Paid This Date

	
Outstanding 

Principal 

Balance

 from Payor 

to Payee This Date

	
Notation 

Made By

	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  
	  	  	  	  	  	  	  

 

 

 

  

EXHIBIT-K-A-1

  

ENDORSEMENT

 

FOR VALUE RECEIVED, each of the undersigned does hereby sell, assign and transfer to [___________] all of its right, title and interest in and to the Intercompany Note, dated [__________], 20[_] (as amended, supplemented, replaced or otherwise modified from time to time, the “Promissory Note”), made by RADNET, INC., a Delaware corporation, RADNET MANAGEMENT, INC., a California corporation (the “Borrower”), and each other Affiliate and Subsidiary of the Borrower or any other Person that becomes a party thereto, and payable to the undersigned.  This endorsement is intended to be attached to the Promissory Note and, when so attached, shall constitute an endorsement thereof.

 

The initial undersigned shall be the Group Members (as defined in the Promissory Note) party to the Loan Documents on the date of the Promissory Note.  From time to time after the date thereof, additional Affiliates and Subsidiaries of the Group Members shall become parties to the Promissory Note (each, an “Additional Payee”) and a signatory to this endorsement by executing a counterpart signature page to the Promissory Note and to this endorsement.  Upon delivery of such counterpart signature page to the Payors, notice of which is hereby waived by the other Payees, each Additional Payee shall be a Payee and shall be as fully a Payee under the Promissory Note and a signatory to this endorsement as if such Additional Payee were an original Payee under the Promissory Note and an original signatory hereof.  Each Payee expressly agrees that its obligations arising under the Promissory Note and hereunder shall not be affected or diminished by the addition or release of any other Payee under the Promissory Note or hereunder.  This endorsement shall be fully effective as to any Payee that is or becomes a signatory hereto regardless of whether any other Person becomes or fails to become or ceases to be a Payee to the Promissory Note or hereunder.

 

Dated:  ________________

 

[Remainder of page intentionally left blank]

 

 

 

 

  

EXHIBIT-K-A-2

  

 

 

	 	
RADNET MANAGEMENT, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

 

	 	

RADNET, INC.

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

 

	 	

[GROUP MEMBERS]

	 
	 	 	 	 
	
 

	
By: 

	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

  

EXHIBIT-K-A-3

  

EXHIBIT L TO

CREDIT AND GUARANTY AGREEMENT

JOINDER AGREEMENT

THIS JOINDER AGREEMENT, dated as of [__________, 20__] (this “Agreement”), by and among [NEW LENDERS] (each a “Lender” and collectively the “Lenders”), RADNET MANAGEMENT, INC., a California corporation (“Borrower”), RADNET, INC., a Delaware corporation (“Holdings”), and CERTAIN SUBSIDIARIES AND AFFILIATES OF THE BORROWER, as Guarantors, DEUTSCHE BANK SECURITIES INC. (“DBSI”) and GENERAL ELECTRIC CAPITAL CORPORATION (“GECC”), as Co-Syndication Agents, BARCLAYS BANK PLC (“Barclays Bank”), as Administrative Agent and Collateral Agent, and RBC CAPITAL MARKETS1 (“RBCCM”), as Documentation Agent.

RECITALS:

WHEREAS, reference is hereby made to the Credit and Guaranty Agreement, dated as of April 6, 2010 (as it may be amended, restated, supplemented or otherwise modified from time to time, the “Credit Agreement’’; the terms defined therein and not otherwise defined herein being used herein as therein defined), by and among the Lenders party thereto from time to time, DBSI and GECC, as Co-Syndication Agents, Barclays Bank, as Administrative Agent and Collateral Agent, and RBCCM, as Documentation Agent; and

WHEREAS, subject to the terms and conditions of the Credit Agreement, Borrower  may increase the existing Revolving Loan Commitments and/or provide Incremental Term Loan Commitments by entering into one or more Joinder Agreements with the Incremental Term Loan Lenders and/or Incremental Revolving Loan Lenders, as applicable.

NOW, THEREFORE, in consideration of the premises and agreements, provisions and covenants herein contained, the parties hereto agree as follows:

Each Lender party hereto hereby agrees to commit to provide its respective Commitment as set forth on Schedule A annexed hereto, on the terms and subject to the conditions set forth below:

Each Lender (i) confirms that it has received a copy of the Credit Agreement and the other Loan Documents, together with copies of the financial statements referred to therein and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Joinder Agreement (this “Agreement”); (ii) agrees that it will, independently and without reliance upon the Administrative Agent or any other Lender or Agent and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iii) appoints and authorizes Administrative Agent and Syndication Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement and the other Loan Documents as are delegated to Administrative Agent and Syndication Agent, as the case may be, by the terms thereof, together with such powers as are reasonably incidental thereto; and (iv) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.

 

___________________

1 RBC Capital Markets is the brand name for the capital markets activities of Royal Bank of Canada and its affiliates.

  

  

EXHIBIT L-1

  

 

Each Lender hereby agrees to make its Commitment on the following terms and conditions2:

	
1.

	
Incremental Term Loan Maturity Date.  The Incremental Term Loan Maturity Date for the Series [__] Incremental Term Loan shall be [   ].

	
2.

	
Applicable Margin.

	
  

	
i.

	
Base Rate Loans: The Applicable Margin for each Series [__] Incremental Term Loan that is a Base Rate Loan shall mean, as of any date of determination, [___]% per annum.

	
  

	
ii.

	
Eurodollar Rate Loans: The Applicable Margin for each Series [__] Incremental Term Loan that is a Eurodollar Rate Loan shall mean, as of any date of determination, [___]% per annum.

	
3.

	
Principal Payments.  Borrower shall make principal payments on the Series [__] Incremental Term  Loans in accordance with Section 2.12 of the Credit Agreement in installments on the dates and in the amounts set forth below:

	
 

(A)

Payment

Date

	
 

(B)

Scheduled

Repayment of

Series [__] Incremental Term Loans

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	  	
 

      $__________

	
 

TOTAL

	
 

      $__________

 

 

_______________________

2 Insert completed items 1-7 as applicable, with respect to Incremental Term Loans with such modifications as may be agreed to by the parties hereto to the extent consistent with Section 2.24 of the Credit Agreement.

 

  

EXHIBIT L-2

  

 

	
4.

	
Voluntary and Mandatory Prepayments.  Scheduled installments of principal of the [Series [__]] Incremental Term Loans set forth above shall be reduced in connection with any voluntary or mandatory prepayments of the [Series [__]] Incremental Term Loans in accordance with Sections 2.12, 2.13 and 2.14 of the Credit Agreement respectively.

	
5.

	
Other Fees.  Borrower agrees to pay each [New Term Loan Lender] [New Revolving Lender] its Pro Rata Share of an aggregate fee equal to [________ __, ____] on [_________ __, ____].

	
6.

	
Proposed Borrowing.  This Agreement represents Borrower’s request to borrow [Series [__] Incremental Term Loans] from Incremental Term Loan Lender as follows (the “Proposed Borrowing”):

	
  

	
a.

	
Business Day of Proposed Borrowing:  ___________, ____

	
  

	
b.

	
Amount of Proposed Borrowing:  $___________________

	
  

	
c.

	
Interest rate option:

	
 ̈

	
a.  Base Rate Loan(s)

 ̈      b.  Eurodollar Rate Loans

     with an initial Interest

     Period of ____ month(s)

	
7.

	
[Incremental Lenders.  Each [Incremental Term Loan Lender] [Incremental Revolving Loan Lender] acknowledges and agrees that upon its execution of this Agreement [and the making of [Incremental Term Loans][Series [__] Incremental Term Loans]] that such [Incremental Term Loan Lender] [Incremental Revolving Loan Lender] shall become a “Lender” under, and for all purposes of, the Credit Agreement and the other Loan Documents, and shall be subject to and bound by the terms thereof, and shall perform all the obligations of and shall have all rights of a Lender thereunder.]3

	
8.

	
Credit Agreement Governs.  Except as set forth in this Agreement, [Incremental Revolving Loans] [Series [__] Incremental Term Loans] shall otherwise be subject to the provisions of the Credit Agreement and the other Loan Documents.

	
9.

	
Borrower’s Certifications.  By its execution of this Agreement, the undersigned officer, to the best of his or her knowledge, and Borrower hereby certify that:

	
  

	
i.

	
The representations and warranties contained in the Credit Agreement and in the other Loan Documents are true and correct in all material respects on and as of the date hereof to the same extent as though made on and as of the date hereof, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties were true and correct in all material respects on and as of such earlier date; provided, that to the extent any such representation or warranty is already qualified by materiality or material adverse effect, such representation or warranty is true and correct in all respects;

	
  

	
ii.

	
No event has occurred and is continuing or would result from the consummation of the Proposed Borrowing contemplated hereby that would constitute a Default or an Event of Default; and

	
  

	
iii.

	
Borrower has performed in all material respects all agreements and satisfied all conditions which the Credit Agreement provides shall be performed or satisfied by it on or before the date hereof.

 

____________________

3 Insert bracketed language if the lending institution is not already a Lender.

  

 

  

EXHIBIT L-3

  

 

	
10.

	
Borrower Covenants.  By its execution of this Agreement, Borrower hereby covenants that:

	
  

	
i.

	
[Borrower shall make any payments required pursuant to Section 2.18(c) of the Credit Agreement in connection with the Incremental Revolving Loan Commitments;]4

	
  

	
ii.

	
Borrower shall deliver or cause to be delivered the following legal opinions and documents: [___________], together with all other legal opinions and other documents reasonably requested by Administrative Agent in connection with this Agreement; and

	
  

	
iii.

	
Set forth on the attached Officers’ Certificate are the calculations (in reasonable detail) demonstrating compliance with the financial tests described in Section 6.07 of the Credit Agreement.

	
11.

	
Eligible Assignee.  By its execution of this Agreement, each [Incremental Term Loan Lender] [Incremental Revolving Loan Lender] represents and warrants that it is an Eligible Assignee.

	
12.

	
Notice.  For purposes of the Credit Agreement, the initial notice address of each [Incremental Term Loan Lender] [Incremental Revolving Loan Lender] shall be as set forth below its signature below.

	
13.

	
Non-US Lenders.  For each [Incremental Revolving Loan Lender] [Incremental Term Loan Lender] that is a Non-US Lender, delivered herewith to Administrative Agent are such forms, certificates or other evidence with respect to United States federal income tax withholding matters as such [Incremental Revolving Loan Lender] [Incremental Term Loan Lender] may be required to deliver to Administrative Agent pursuant to subsection 2.20(c) of the Credit Agreement.

	
14.

	
Recordation of the Incremental Loans.  Upon execution and delivery hereof, Administrative Agent will record the  [Series [__] Incremental Term Loans] [Incremental Revolving Loans] made by [Incremental Term Loan Lenders] [Incremental Revolving Loan Lenders] in the Register.

	
15.

	
Amendment, Modification and Waiver.  This Agreement may not be amended, modified or waived except by an instrument or instruments in writing signed and delivered on behalf of each of the parties hereto.

	
16.

	
Entire Agreement.  This Agreement, the Credit Agreement and  the other Loan Documents constitute the entire agreement among the parties with respect to the subject matter hereof and thereof and supersede all other prior agreements and understandings, both written and verbal, among the parties or any of them with respect to the subject matter hereof.

	
17.

	
GOVERNING LAW.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

	
18.

	
Severability.  Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction.  If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as would be enforceable.

	
19.

	
Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement.

 

 

____________________

4 Select this provision in the circumstance where the Lender is an Incremental Revolving Loan Lender.

[Remainder of page intentionally left blank]

  

  

EXHIBIT L-4

  

IN WITNESS WHEREOF, each of the undersigned has caused its duly authorized officer to execute and deliver this Joinder Agreement as of [_____________, ______].

 

 

[NAME OF LENDER]

 

 

By:______________________________

Name:

Title:

 

Notice Address:

 

Attention:

Telephone:

Facsimile:

 

 

RADNET MANAGEMENT, INC.

 

By: __________________________

Name:

Title:

 

 

RADNET, INC.

 

By: __________________________

Name:

Title:

 

 

[ADD ADDITIONAL GUARANTORS AS NECESSARY]

 

By: __________________________

Name:

Title:

  

EXHIBIT L-5

  

Consented to by:

BARCLAYS BANK PLC

as Administrative Agent

By: _____________________________

Name:

Title:

  

EXHIBIT L-6

  

SCHEDULE A

TO JOINDER AGREEMENT

	
 

Name of Lender

	
 

Type of Commitment

	
 

Amount

	
 

[___________________]

	
 

[Incremental Term Loan Commitment] [Incremental Revolving Loan Commitment]

	
 

$_________________

	  	  	  
	  	  	
 

Total: $_________________

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXHIBIT L-7shearson_ex0401.htm

Exhibit 4.1

 

 

 

 

  

  

  

 

 

 

 

PSA, INC.

 

The Corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.  Any such request should be directed to the Corporation, attention of its Secretary at the Corporation's principal executive offices.

 

The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations.

 

 

	TEN COM - 	as tenants in common	 	UNIF GIFT MIN ACT - 	________Custodian________ 
	TEN ENT - 	as tenants by the entireties	 	 	    (Cust)                         (Minor)     
	JT TEN - 	as joint tenants with the rights of suvivorship and not as tenants in common	 	 	under Uniform Gifts to Minors
	 	 	 	 	
Act ________________

                 (State)

 

 

Additional abbreviations may also be used thought not in the above list.

 

 

For Value Received, __________________________ hereby sell(s), assign(s) and transfer(s) unto

 

 

 

	PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
	
 

 

 

 

 

PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE(S)

 

 

 

 

of the Shares of capital stock represented by the within Certificate and do(es hereby irrevocably constitute and appoint ___________________________ Attorney to transfer the said Shares on the books of the within named Corporation with full power of substitution in the premises.

 

 

	Dated:  ____________________________________	 	 
	 	 	 
	 	 	NOTE:  The signature to this assignment must correspond within the names as written upon the face of the certificate in every particular, without alteration or enlargement or any change whatever.  Signature must be guaranteed.

 

 

Signature(s) Guaranteed

 

 

 

 

By: _________________________________________________________________________________

THE SIGNATURE(S) MUST BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS,

STOCIKBROKERS, SAVINGS, AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN

APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17 Ad. 15

 

 

	 	NO SALE, OFFER TO SELL OR TRANSFER OF THE SHARE REPRESENTED BY THIS CERTIFICATE SHALL BE MADE UNLESS A REGISTRATION STATEMENT UNDER THE FEDERAL SECURITIES ACT OF 1933, AS AMENDED, WITH RESPECT TO SUCH SHARES IS THEN IN EFFECT OR AN EXEMPTION FROM THE REQUIREMENTS OF SUCH ACT IS THEN IN FACE APPLICABLE TO SUCH SHARES.

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