Exhibit 10.10
THIRD AMENDMENT TO
DEBTOR-IN-POSSESSION CREDIT AGREEMENT AND
LIMITED WAIVER AND CONSENT
December 23, 1999
Reference is made to that certain Debtor-In-Possession Credit
Agreement dated as of September 13, 1999 (as heretofore amended, supplemented or
otherwise modified, the "DIP Credit Agreement"), by and among Vencor, Inc., a
Delaware corporation ("Vencor"), and Vencor Operating, Inc., a Delaware
corporation ("Vencor Opco"), each as debtor and debtor-in-possession, and each
of Vencor's subsidiaries listed on the signature pages thereof, each as debtor
and debtor-in-possession (each such subsidiary, Vencor and Vencor Opco
individually referred to herein as a "Borrower" and, collectively, on a joint
and several basis, as the "Borrowers"); the Lenders listed on the signature
pages thereof; and Xxxxxx Guaranty Trust Company of New York, as arranger,
collateral agent and administrative agent (in such capacity, "Administrative
Agent") for the Lenders, and as an issuing bank for Letters of Credit
thereunder. Capitalized terms used herein without definition herein shall have
the meanings assigned to such terms in the DIP Credit Agreement.
Borrowers have (i) advised Lenders that Borrowers plan to record a
significant charge to their December 1999 earnings to provide for additional bad
debt reserves, and that as a result, Borrowers may be unable to comply with
covenants in the DIP Credit Agreement requiring minimum Consolidated EBITDAR and
a minimum Net Amount of Eligible Accounts (it being understood that Borrowers
have not advised the Lenders that Borrowers will not be in compliance with such
covenants); (ii) requested certain amendments to the DIP Credit Agreement as
more fully set forth below; and (iii) submitted to Lenders a supplement to the
Cash Plan, attached hereto as Annex A (the "Cash Plan Supplement"), setting
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forth, for January 2000 and February 2000, a consolidated cash forecast for the
Borrowers. Accordingly:
1. The undersigned Lenders hereby waive, for the period from
December 1, 1999 through and including February 14, 2000, compliance with
the provisions of Sections 6.01 and 6.04 of the DIP Credit Agreement with
respect to all periods from December 1, 1999 through and including February
14, 2000; provided, that any breach of such provisions which would
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constitute an Event of Default but for the foregoing waiver shall be an
Event of Default on and after February 15, 2000 unless otherwise waived or
remedied prior to such date.
2. Borrowers and the undersigned Lenders hereby agree that:
(a) Section 1.01 of the DIP Credit Agreement is hereby amended by
inserting therein the following definitions, in alphabetical order:
"Third Amendment" means that certain Third Amendment to
Debtor-In-Possession Credit Agreement and Limited Waiver and
Consent dated as of December 23, 1999, by and among the
Borrowers, the Collateral Agent, the Administrative Agent and the
Lenders party thereto.
"Third Amendment Effective Date" has the meaning assigned to
that term in the Third Amendment.
(b) Section 5.10 of the DIP Credit Agreement is hereby amended
by deleting the reference to "the date which is four months after the
Petition Date" contained therein and substituting therefor "March 12,
2000";
(c) Section 7.04 of the DIP Credit Agreement is hereby amended
by (i) deleting the "and" at the end of clause (b) thereof, (ii)
deleting the "." at the end of clause (c) thereof and substituting
therefor "; and", and (iii) adding at the end thereof the following
new clause (d):
"(d) Capital contributions to Cornerstone made after
December 25, 1999, in an aggregate amount not to exceed
$1,000,000; provided, that (i) no Default or Event of Default
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shall have occurred and be continuing or would result from such
contributions, (ii) such contributions shall not be in excess of
amounts requested to be so contributed by the applicable Cayman
Islands Governmental Authority, and (iii) such contributions are
approved by the Court to the extent such approval is required
pursuant to the Bankruptcy Code or an order of the Court."
(d) Section 7.05 of the DIP Credit Agreement is hereby amended
by adding immediately prior to the "." at the end thereof the
following proviso:
"; and provided, further, that the foregoing shall not prohibit,
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after the Third Amendment Effective Date, the purchase of
vehicles and office furniture and equipment from Behavioral
Healthcare Corporation for aggregate cash consideration not to
exceed $20,000, so long as (1) no Default or Event of Default
shall have occurred and be continuing or would result therefrom,
(2) the consideration paid shall be no more than the fair market
value of the assets purchased, (3) such purchase is consummated
on terms and conditions at least as favorable to the relevant
Vencor Company as the terms and conditions which would apply in a
similar transaction with a Person not an Affiliate, and (4) such
purchase is approved by the Court to the extent such approval is
required pursuant to the Bankruptcy Code or an order of the
Court."
3. Each of the undersigned Lenders hereby (i) acknowledges that the
substance of the Cash Plan Supplement is satisfactory to such Lender and
(ii) consents to supplementing the Cash Plan with the forecast contained in
the Cash Plan Supplement.
On and after the Third Amendment Effective Date (as defined below),
each reference in the DIP Credit Agreement to "this Agreement", "hereunder",
"hereof", "herein" or
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words of like import referring to the DIP Credit Agreement, and each reference
in the other Financing Documents to the "DIP Credit Agreement", "thereunder",
"thereof" or words of like import referring to the DIP Credit Agreement, shall
mean and be a reference to the DIP Credit Agreement as amended by this Third
Amendment to Debtor-In-Possession Credit Agreement and Limited Waiver and
Consent (this "Third Amendment"; the DIP Credit Agreement, as so amended, being
the "Amended Agreement").
Without limiting the generality of the provisions of Section 11.05 of
the DIP Credit Agreement, the waiver, the amendments and the consent set forth
in paragraphs 1, 2 and 3 above, respectively, shall be limited precisely as
written, and nothing in this Third Amendment shall be deemed to (a) constitute a
waiver of compliance by Borrowers with respect to (i) Section 6.01 of the DIP
Credit Agreement in any other instance or (ii) any other term, provision or
condition of the DIP Credit Agreement or any of such other Financing Documents,
(b) constitute a consent to any other supplement to the Cash Plan or any other
document, transaction, occurrence, event or condition under Section 5.01(m) of
the DIP Credit Agreement or any other term, provision or condition of the DIP
Credit Agreement or any of such other Financing Documents, or (c) prejudice any
right or remedy that the Administrative Agent or any Lender may now have or may
have in the future under or in connection with the DIP Credit Agreement or any
of such other Financing Documents. Except as specifically waived or amended by
this Third Amendment, the DIP Credit Agreement and such other Financing
Documents shall remain in full force and effect and are hereby ratified and
confirmed.
In order to induce Lenders to enter into this Third Amendment, each
Borrower, by its execution of a counterpart of this Third Amendment, represents
and warrants that (a) such Borrower has the corporate or other power and
authority and all material Governmental Approvals required to enter into this
Third Amendment and to carry out the transactions contemplated by, and perform
its obligations under, the Amended Agreement, (b) the execution and delivery of
this Third Amendment and the performance of the Amended Agreement have been duly
authorized by all necessary corporate or other action on the part of such
Borrower, (c) the execution and delivery by such Borrower of this Third
Amendment and the performance by such Borrower of the Amended Agreement do not
and will not contravene, or constitute a default under, any Applicable Laws
(including an applicable order of the Court) or any provision of its
Organizational Documents, or of any agreement or other instrument binding upon
it or result in or require the imposition of any Liens (other than the Liens
created by the Collateral Documents) on any of its assets, (d) the execution and
delivery by such Borrower of this Third Amendment and the performance by such
Borrower of the Amended Agreement do not and will not require any action by or
in respect of, or filing with, any governmental body, agency or official (except
for the Court and such as shall have been made at or before the time required
and shall be in full force and effect on and after the date when made), (e) this
Third Amendment and the Amended Agreement have been duly executed and delivered
by such Borrower and constitute the valid and binding obligations of such
Borrower, enforceable in accordance with their respective terms, except as may
be limited by general principles of equity, (f) for purposes of the Borrowing
Order (i) this Third Amendment constitutes a non-material modification of the
DIP Credit Agreement and the Financing Documents, and (ii) notice of this Third
Amendment has been given to and received by counsel to the Committee (as defined
in the Borrowing Order), and (g) after giving effect to this Third Amendment, no
event has occurred and is continuing or will result from the
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consummation of the transactions contemplated by this Third Amendment that would
constitute a Default or an Event of Default.
This Third Amendment may be executed in any number of counterparts and
by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument. This Third Amendment
shall become effective (the date of such effectiveness being the "Third
Amendment Effective Date") upon the earliest date that the Borrowers and
Required Lenders shall have executed counterparts of this Third Amendment and
the Borrowers and the Administrative Agent shall have received written or
telephonic notification of such execution and authorization of delivery thereof;
provided, however, that it shall be a condition subsequent to the effectiveness
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hereof that the Administrative Agent shall have received, on or prior to January
15, 2000, from the Borrowers an amendment and waiver fee in the aggregate amount
of $200,000 for ratable distribution to each Lender that has executed and
delivered this Third Amendment on or prior to December 30, 1999 according to the
ratio of (x) the Commitment of such executing Lender to (y) the aggregate
Commitments of all such executing Lenders, and if Administrative Agent shall not
have received such fee by January 15, 2000, this Third Amendment and all
amendments and waivers effected hereby shall immediately be null and void, ab
initio, and of no force and effect whatsoever.
THIS THIRD AMENDMENT 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 (INCLUDING WITHOUT
LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW
YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
[Remainder of page intentionally left blank]
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BORROWERS:
Advanced Infusion Systems, Inc.
American X-Rays, Inc.
C.P.C. of Louisiana, Inc.
Community Behavioral Health System, Inc.
Community Psychiatric Centers of Arkansas, Inc.
Community Psychiatric Centers of California
Community Psychiatric Centers of Florida, Inc.
Community Psychiatric Centers of Idaho, Inc.
Community Psychiatric Centers of Indiana, Inc.
Community Psychiatric Centers of Kansas, Inc.
Community Psychiatric Centers of Mississippi, Inc.
Community Psychiatric Centers of Missouri, Inc.
Community Psychiatric Centers of North Carolina, Inc.
Community Psychiatric Centers of Oklahoma, Inc.
Community Psychiatric Centers of Utah, Inc.
Community Psychiatric Centers Properties Incorporated
Community Psychiatric Centers Properties of Oklahoma, Inc.
Community Psychiatric Centers Properties of Texas, Inc.
Community Psychiatric Centers Properties of Utah, Inc.
Courtland Gardens Health Center, Inc.
CPC Investment Corp.
CPC Managed Care Health Services, Inc.
CPC of Georgia, Inc.
CPC Properties of Arkansas, Inc.
CPC Properties of Illinois, Inc.
CPC Properties of Indiana, Inc.
CPC Properties of Kansas, Inc.
CPC Properties of Louisiana, Inc.
CPC Properties of Mississippi, Inc.
CPC Properties of Missouri, Inc.
CPC Properties of North Carolina, Inc.
First Rehab, Inc.
Florida Hospital Properties, Inc.
Health Care Holdings, Inc.
Health Care Technology, Inc.
Helian ASC of Northridge, Inc.
Helian Health Group, Inc.
Helian Recovery Corporation
Homestead Health Center, Inc.
Horizon Healthcare Services, Inc.
Interamericana Health Care Group
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X.X. Xxxxxx Hospital, Inc.
Lafayette Health Care Center, Inc.
MedEquities, Inc.
Medisave of Tennessee, Inc.
Medisave Pharmacies, Inc.
Old Orchard Hospital, Inc.
Palo Alto Surgecenter Corporation
Peachtree-Parkwood Hospital, Inc.
PersonaCare, Inc.
PersonaCare Living Center of Clearwater, Inc.
PersonaCare of Bradenton, Inc.
PersonaCare of Clearwater, Inc.
PersonaCare of Connecticut, Inc.
PersonaCare of Georgia, Inc.
PersonaCare of Huntsville, Inc.
PersonaCare of Little Rock, Inc.
PersonaCare of Ohio, Inc.
PersonaCare of Owensboro, Inc.
PersonaCare of Pennsylvania, Inc.
PersonaCare of Pompano East, Inc.
PersonaCare of Pompano West, Inc.
PersonaCare of Reading, Inc.
PersonaCare of San Antonio, Inc.
PersonaCare of San Xxxxx, Inc.
PersonaCare of Shreveport, Inc.
PersonaCare of St. Petersburg, Inc.
PersonaCare of Warner Xxxxxxx, Inc.
PersonaCare of Wisconsin, Inc.
PersonaCare Properties, Inc.
ProData Systems, Inc.
Recovery Inns of America, Inc.
Respiratory Care Services, Inc.
Stamford Health Facilities, Inc.
THC-Chicago, Inc.
THC-Hollywood, Inc.
THC-Houston, Inc.
THC-Minneapolis, Inc.
THC-North Shore, Inc.
THC-Orange County, Inc.
THC-San Diego, Inc.
THC-Seattle, Inc.
TheraTx Healthcare Management, Inc.
TheraTx Health Services, Inc.
TheraTx Management Services, Inc.
TheraTx Medical Supplies, Inc.
TheraTx Rehabilitation Services, Inc.
TheraTx Staffing, Inc.
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Transitional Hospitals Corporation, a Delaware Corporation
Transitional Hospitals Corporation, a Nevada Corporation
Transitional Hospitals Corporation of Indiana, Inc.
Transitional Hospitals Corporation of Louisiana, Inc.
Transitional Hospitals Corporation of Michigan, Inc.
Transitional Hospitals Corporation of Nevada, Inc.
Transitional Hospitals Corporation of New Mexico, Inc.
Transitional Hospitals Corporation of Tampa, Inc.
Transitional Hospitals Corporation of Texas, Inc.
Transitional Hospitals Corporation of Wisconsin, Inc.
Xxxxxx Nursing Center, Inc.
Xxxxxxxx Enterprises, Inc.
VC-OIA, Inc.
VC-TOHC, Inc.
XX-XX, Inc.
Vencare, Inc.
Vencare Rehab Services, Inc.
Vencor Facility Services, Inc.
Vencor Holdings, L.L.C.
Vencor Home Care Services, Inc.
Vencor Hospice, Inc.
Vencor Hospitals East, L.L.C.
Vencor Hospitals West, L.L.C.
Vencor, Inc.
Vencor Insurance Holdings, Inc.
Vencor Investment Company
Vencor Nevada, L.L.C.
Vencor Nursing Centers East, L.L.C.
Vencor Nursing Centers Central L.L.C.
Vencor Nursing Centers North, L.L.C.
Vencor Nursing Centers South, L.L.C.
Vencor Nursing Centers West, L.L.C.
Vencor Operating, Inc.
Vencor Pediatric Care, Inc.
Vencor Provider Network, Inc.
Ventech Systems, Inc.
BY: Vencor Operating, Inc., as agent and attorney-in-fact
for each of the foregoing entities
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
---------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
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Stamford Health Associates, L.P.
BY: Stamford Health Facilities, Inc., Its General
Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
Vencor Home Care and Hospice Indiana Partnership
BY: Vencor Home Care Services, Inc., Its General
Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
BY: Vencor Hospice, Inc., Its General Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
Vencor Hospitals Limited Partnership
BY: Vencor Operating, Inc., Its General Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
BY: Vencor Nursing Centers Limited Partnership,
Its General Partner
BY: Vencor Operating, Inc., Its General
Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
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Vencor Nursing Centers Central Limited
Partnership,
BY: Vencor Operating, Inc., Its General Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
BY: Vencor Nursing Centers Limited Partnership,
Its General Partner
BY: Vencor Operating, Inc., Its General
Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
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Vencor Nursing Centers Limited Partnership
BY: Vencor Operating, Inc., Its General Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
BY: Vencor Hospitals Limited Partnership, Its
General Partner
BY: Vencor Operating, Inc., Its General
Partner
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: Senior Vice President and CFO
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AGENTS AND LENDERS:
XXXXXX GUARANTY TRUST COMPANY OF NEW YORK, as Arranger,
Collateral Agent and Administrative Agent and as a
Lender
By: /s/ Houston X. Xxxxxxxx
------------------------
Name: Houston X. Xxxxxxxx
Title: Vice President
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ABLECO FINANCE LLC, as a Lender
By: _________________________________________
Name:
Title:
S-8
APPALOOSA INVESTMENT LIMITED PARTNERSHIP I,
as a Lender
By: /s/ Xxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
S-9
BANKERS TRUST COMPANY, as a Lender
By: _________________________________________
Name:
Title:
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CHASE SECURITIES INC, AS AGENT FOR THE CHASE
MANHATTAN BANK, as a Lender
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Authorized Signatory
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XXXXXXX XXXXX CREDIT PARTNERS L.P., as a
Lender
By: /s/ Xxxx Xxxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxxx
Title: Authorized Signatory
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PARIBAS, as a Lender
By: /s/ Xxxxxx X. Xxxxx, Xx.
-----------------------------------------
Name: Xxxxxx X. Xxxxx, Xx.
Title: Director
By: /s/ Xxx Xxxxxxxxx
-----------------------------------------
Name: Xxx Xxxxxxxxx
Title: Vice President
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XXX XXXXXX PRIME RATE INCOME TRUST, as a
Lender
By: XXX XXXXXX INVESTMENT ADVISORY CORP.
By: /s/ Xxxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
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FRANKLIN MUTUAL ADVISERS LLC, as a Lender
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Assistant Vice President
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FRANKLIN FLOATING RATE TRUST, as a Lender
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------------------
Name: Xxxxxxxx Xxxxxx
Title: Vice President
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ACKNOWLEDGEMENT AND CONSENT OF SUBSIDIARY GUARANTOR
By its execution of a counterpart of this Third Amendment, the
undersigned, as a Subsidiary Guarantor under that certain Guaranty Agreement
dated as of September 13, 1999 (the "Guaranty") for the benefit of Lenders, and
as an Original Lien Grantor under that certain Security Agreement dated as of
September 13, 1999 (the "Security Agreement") between the undersigned, the
Borrowers and Collateral Agent, as Secured Party, hereby acknowledges that it
has read this Third Amendment and consents to the terms thereof and further
hereby confirms and agrees that, notwithstanding the effectiveness of this Third
Amendment, the obligations of the undersigned under the Guaranty and the
Security Agreement shall not be impaired or affected and each of the Guaranty
and the Security Agreement is, and shall continue to be, in full force and
effect and is hereby confirmed and ratified in all respects.
CARIBBEAN BEHAVIORAL HEALTH
SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
------------------------------------
Name:
Title:
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Annex A
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Vencor, Inc.
Cash Plan
Period: Weeks Beginning January 3, 2000 to February 29, 2000
Prepared: December 22, 1999
(in millions)
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CASH FLOW FORECAST: (Prepared by Company on December 15, 1999)
Week Beginning: 1/3/00 1/10/00 1/17/00 1/24/00 1/31/00 2/7/00 2/14/00 2/21/00 2/28/00
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Projected Receipts:
Facility Receipts $ 31.2 $ 32.5 $ 43.5 $ 34.0 $ 33.5 $ 35.0 $ 38.0 $ 30.4 $ 15.0
Agency Receipts 17.5 17.5 17.5 17.5 19.0 19.0 15.0 19.2 3.5
PIP Receipts 8.5 - 8.5 - 8.5 - 10.5 - -
Misc Receipts - - - - - - - - -
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Subtotal Receipts $ 57.2 $ 50.0 $ 69.5 $ 51.5 $ 61.0 $ 54.0 $ 63.5 $ 49.6 $ 18.5
Projected Disbursements:
Accounts Payable $ (26.0) $ (26.0) $ (26.8) $ (24.9) $ (27.9) $ (27.9) $ (29.0) $ (15.6) $ (11.2)
Ventas (15.2) - - - (15.2) - - - -
Scheduled PIP Payments - (2.0) - - - (2.0) - - -
Payroll (21.8) (15.3) (18.2) (17.4) (21.1) (16.4) (19.6) (15.6) (5.6)
Taxes (5.5) (9.9) (6.0) (8.7) (6.0) (11.2) (6.7) (7.9) (0.4)
VEBA Funding (1.1) (1.1) (1.1) (1.1) (1.1) (1.0) (1.0) (1.0) (1.0)
Vendor Deposits (1.4) (1.4) (1.4) (1.4) (2.4) (2.4) (2.4) - (2.4)
Executive Retention - - - - - - - - -
Restructuring Costs - (1.1) - - - (1.1) - - -
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Subtotal Uses of Cash $ (71.0) $ (56.8) $ (53.5) $ (53.5) $ (73.7) $ (62.0) $ (58.7) $ (40.1) $ (20.6)
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Daily Cash Flow before Next Day
Funding Requirements $ (13.8) $ (6.8) $ 16.0 $ (2.0) $ (12.7) $ (8.0) $ 4.8 $ 9.5 $ (2.1)
Reduce (Borrow) Next Day Funding
Requirement - - - - - - - - -
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Subtotal Net Sources (Uses) of
Cash $ (13.8) $ (6.8) $ 16.0 $ (2.0) $ (12.7) $ (8.0) $ 4.8 $ 9.5 $ (2.1)
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Forecasted Revolver (Borrowing)
Repayment $ (13.8) $ (6.8) $ 16.0 $ (2.0) $ (12.7) $ (8.0) $ 4.8 $ 9.5 $ (2.1)
Beginning Revolver $ - $ - $ - $ - $ - $ - $ - $ - $ -
Activity - - - - - - - - -
------- -------- -------- -------- -------- ------- -------- -------- --------
Ending Revolver $ - $ - $ - $ - $ - $ - $ - $ - $ -
======= ======== ======== ======== ======== ======= ======== ======== ========
Beginning Cash $ 94.3 $ 80.5 $ 73.7 $ 89.7 $ 87.7 $ 75.0 $ 67.0 $ 71.8 $ 81.3
Net Change in Cash (13.8) (6.8) 16.0 (2.0) (12.7) (8.0) 4.8 9.5 (2.1)
------- -------- -------- -------- -------- ------- -------- -------- --------
Ending Cash $ 80.5 $ 73.7 $ 89.7 $ 87.7 $ 75.0 $ 67.0 $ 71.8 $ 81.3 $ 79.2
======= ======== ======== ======== ======== ======= ======== ======== ========
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COVENANT COMPUTATION:
Cumulative Net Cash Flow $ (13.8) $ (20.6) $ (4.6) $ (6.6) $ (19.3) $ (27.3) $ (22.5) $ (13.0) $ (15.1)
Permitted Variance (1) (15.0) (15.0) (12.0) (12.0) (12.0) (10.0) (10.0) (10.0) (10.0)
------- -------- -------- -------- -------- ------- -------- -------- --------
Compliance with Cash Plan $ (28.8) $ (35.6) $ (16.6) $ (18.6) $ (31.3) $ (37.3) $ (32.5) $ (23.0) $ (25.1)
======= ======== ======== ======== ======== ======= ======== ======== ========
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(1) The Borrower is allowed to disburse up to $37,500,000 above the permitted
variance if, and only if, such disbursements are required to be made to
repay obligations owing to Medicare or its agents.