Exhibit 10.23
ADDENDUM TO CONCENTRATION BANK AGREEMENT
(COLLECTION BANK AGREEMENT)
This ADDENDUM TO CONCENTRATION BANK AGREEMENT (COLLECTION
BANK AGREEMENT) (this "ADDENDUM") is dated as of July 31, 2001, among PNC BANK,
NATIONAL ASSOCIATION (the "COLLECTION BANK"), AMERICAN HOMEPATIENT, INC., a
Delaware corporation (referred to herein as the "BORROWER"), each of the
parties listed on the signature pages hereof as an additional pledgor (each an
"ADDITIONAL PLEDGOR" and collectively the "ADDITIONAL PLEDGORS"), and BANKERS
TRUST COMPANY, as agent for and representative of (the "AGENT") the financial
institutions (the "LENDERS") party to that certain Fifth Amended and Restated
Credit Agreement dated as of May 25, 2001 by and among the Borrower, the
Lenders and the Agent (said Fifth Amended and Restated Credit Agreement, as it
may hereafter be amended, supplemented or otherwise modified from time to time,
the "CREDIT AGREEMENT;" capitalized terms used herein without definition have
the meanings assigned to those terms in the Credit Agreement, the Borrower
Security Agreement or the Subsidiary Security Agreement, as the case may be;
undefined terms that are defined in the Uniform commercial Code, as it is
currently enacted or may hereafter be amended, in the applicable jurisdiction
or jurisdictions shall have the meanings set forth therein).
WITNESSETH:
WHEREAS, Borrower and each Additional Pledgor has established
at the Collection Bank the accounts described on Schedule I hereto for the
purpose of the collection of Accounts Receivable and may hereafter establish
additional accounts for such purpose (each individually, a "COLLECTION ACCOUNT"
and collectively, the "COLLECTION ACCOUNTS");
WHEREAS, Borrower and the Agent entered into that certain
Borrower Security Agreement, and each Additional Pledgor and Agent entered into
that certain Subsidiary Security Agreement, each dated as of October 20, 1994,
pursuant to which Borrower and Additional Pledgors granted to the Agent a
security interest in all of their right, title and interest in and to their
Accounts Receivable and the proceeds thereof (including, without limitation,
the Collection Accounts) and all amounts from time to time on deposit therein;
WHEREAS, it is a requirement of the Credit Agreement that the
parties hereto execute and deliver a Collection Bank Agreement; and
WHEREAS, Borrower, Additional Pledgors, Agent and Collection
Bank desire to execute and deliver this Addendum as an amendment to the
Concentration Bank Agreement dated as of June 8, 2001 among Borrower Agent and
PNC Bank, National Association, as Concentration Bank (the "CONCENTRATION BANK
AGREEMENT"), in lieu of the execution and delivery of a separate Collection
Bank Agreement.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. AFFIRMATION OF SECURITY INTEREST.
(a) To secure the due and punctual payment of
the Secured Obligations, Borrower and each Additional Pledgor hereby
reaffirms and ratifies its assignment and grant and hereby further
assigns and grants to the Agent, for the benefit of the Lenders, a
security interest in and a lien upon all of the Borrower's or such
Additional Pledgor's Collection Account(s) and all other Deposit
Accounts of Borrower and each Additional Pledgor at the Collection
Bank, including all funds and assets from time to time on deposit
therein and all contract rights, claims, choses in action and
privileges in respect thereof.
(b) The parties agree that all funds deposited
in the Collection Accounts and other Deposit Accounts from time to
time shall be subject to the security interests in favor of the Agent
and shall be held by the Collection Bank subject to the security
interest of the Agent as provided herein.
(c) The Agent, the Collection Bank, Borrower
and each of the Additional Pledgors agree that all checks, money
orders, and other evidences of payment may be deposited in the
Collection Bank without the endorsement of Borrower or any Additional
Pledgor.
(d) Except as expressly provided in this
Addendum or the Concentration Bank Agreement, neither the Borrower nor
any Additional Pledgor shall agree to grant or grant any interest,
including security interests, to the Collection Bank with respect to
the funds contained in any Collection Account or any other Deposit
Account. Except as expressly provided in this Addendum or the
Concentration Bank Agreement, the Collection Bank shall not take any
interest, including security interests, or seek to obtain any
interest, including security interests, in the funds contained in the
security account.
(e) The Borrower and the Additional Pledgors
hereby acknowledge and agree that the authorizations hereunder are
powers coupled with an interest.
2. DEPOSIT OF FUNDS. Each of Borrower and the
Additional Pledgors agrees that all Accounts Receivable received by it shall be
deposited by it in the Collection Account(s) or into similar accounts subject
to a Collection Bank Agreement and that no funds from any other source other
than proceeds of Accounts Receivable shall be deposited in any such account.
3. TRANSFER OF FUNDS.
(a) Each of the Borrower and the Additional
Pledgors hereby irrevocably authorizes and directs the Collection Bank
to transfer all Collected Funds in its Collection Account(s) on each
Business Day to the concentration account (the "CONCENTRATION
ACCOUNT") at the Concentration Bank (initially,
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Account No. 3100531945 at PNC Bank, National Association, at 000 Xxxx
Xxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 40202), as the Agent and
Borrower shall mutually agree from time to time, or, after the
occurrence and during the continuance of an Event of Default, as the
Agent may, in its sole discretion, direct in writing. "Collected
Funds" means funds in the Collection Account which are not subject to
hold for uncollected funds pursuant to Federal Reserve Regulation CC
or the Collection Bank's customary procedures.
(b) After Agent gives written notice to the
Collection Bank (with a copy to the Borrower and the Additional
Pledgors) that an Event of Default has occurred and is continuing
under the Credit Agreement and prior to the revocation of such notice
by Agent, each of the Borrower and the Additional Pledgors hereby
irrevocably authorizes and directs the Collection Bank, and the
Collection Bank hereby agrees, to comply with, and only with,
instructions from the Agent, without further consent from it,
directing the disposition of the funds in its Collection Accounts and
any other Deposit Accounts.
4. NOTICE OF TERMINATION OF COLLECTION ACCOUNTS. The
Collection Bank hereby agrees that it will provide the Agent with written
notice on or before the date that it terminates any of the Collection Accounts.
5. REVOCATION OF DEFAULT NOTICE. Any notice of an Event
of Default may be revoked and be of no further effect at such time as the Agent
delivers notice of revocation to the Collection Bank, provided that the
Collection Bank has had a reasonable period of time to implement changes, if
any, affecting the Collection Bank as a result of such notice.
6. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in one or more 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 taken together shall constitute
but one and the same instrument; signature pages may be detached from multiple
separate counterparts and attached to a single counterpart so that all
signature pages are attached physically to the same document. This Agreement
shall become effective as of the date first set forth above upon the execution
of a counterpart hereof by each of the Borrower, the Additional Pledgors, the
Collection Bank and the Agent and receipt by the Agent of written or telephonic
notification of such execution and authorization of delivery thereof. Delivery
of an executed counterpart to this Agreement by facsimile transmission shall be
effective as delivery of a manually executed counterpart of this Agreement.
7. HEADINGS. The section headings in this Agreement are
inserted for convenience of reference and shall not be considered a part of
this Agreement or used in its interpretation.
8. AGREEMENT DULY AUTHORIZED. All parties hereto
represent and warrant that they have taken all actions and obtained all
authorizations, consents and approvals as
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are conditions precedent to their authority to execute this Agreement.
9. GOVERNING LAW. EXCEPT TO THE EXTENT THAT THE LAWS OF
THE STATE IN WHICH THE COLLECTION BANK IS LOCATED GOVERN THE COLLECTION
ACCOUNTS, 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 CONFLICTS OF LAWS PRINCIPLES. NOTWITHSTANDING THE FOREGOING,
THE SECURITY INTERESTS GRANTED HEREUNDER SHALL BE GOVERNED AND DETERMINED BY
THE UNIFORM COMMERCIAL CODE IN EFFECT WITH RESPECT TO EACH COLLECTION ACCOUNT
IN THE JURISDICTION SET FORTH ON SCHEDULE I, AS SUCH CODE MAY BE AMENDED
(INCLUDING AMENDMENTS RELATED TO REVISED ARTICLE 9) OR SUCH OTHER APPLICABLE
LAW (AS AMENDED) THAT INCREASES THE VALIDITY AND ENFORCEABILITY OF THE SECURITY
INTERESTS GRANTED HEREUNDER, IT BEING THE INTENT OF THE PARTIES THAT THE
SECURITY INTERESTS GRANTED HEREUNDER BE GIVEN THE BROADEST POSSIBLE SCOPE.
10. REFERENCE TO AND EFFECT ON THE CONCENTRATION BANK
AGREEMENT AND THE OTHER CREDIT DOCUMENTS.
(a) All references to Borrower in Sections
2(g), 6(b), 8, 10-19, 21, 23, 24 and 27-29 in the Concentration Bank
Agreement shall be deemed to include Additional Pledgors with respect
to all matters related to their Collection Bank Accounts and all
references, if any, in such Sections to the Concentration Account
shall include the Collection Accounts.
(b) On and after the date hereof, each
reference in the Concentration Bank Agreement to "this Agreement",
"hereunder", "hereof", "herein" or words of like import referring to
the Concentration Bank Agreement, and each reference in the other
Credit Documents to the "Concentration Bank Agreement", the
"Collection Bank Agreement with PNC Bank, National Association",
"thereunder", "thereof" or words of like import referring to the
Concentration Bank Agreement or the Collection Bank Agreement with PNC
Bank, National Association shall mean and be a reference to the
Concentration Bank Agreement, as amended by this Addendum.
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IN WITNESS WHEREOF, each of the parties hereto has caused
this agreement to be executed and delivered by its duly authorized officer on
the date first set forth above.
BORROWER: AMERICAN HOMEPATIENT, INC.,
a Delaware corporation
By:
----------------------------------------
Name:
Title:
S-1
ADDITIONAL
PLEDGORS: AHP, L.P.
AHP ALLIANCE OF COLUMBIA
AHP HOME CARE ALLIANCE OF GAINESVILLE
AHP HOME CARE ALLIANCE OF TENNESSEE
AHP HOME CARE ALLIANCE OF VIRGINIA
AHP KNOXVILLE PARTNERSHIP
AHP HOME MEDICAL EQUIPMENT PARTNERSHIP
OF TEXAS
AHP FINANCE, INC.
ALLEGHENY RESPIRATORY ASSOCIATES, INC.
AMERICAN HOMEPATIENT, INC.
AMERICAN HOMEPATIENT OF ARKANSAS, INC.
AMERICAN HOMEPATIENT OF ILLINOIS, INC.
AMERICAN HOMEPATIENT OF IOWA, INC.
AMERICAN HOMEPATIENT OF NEVADA, INC.
AMERICAN HOMEPATIENT OF TEXAS, L.P.
AMERICAN HOMEPATIENT VENTURES, INC.
BREATHING EQUIPMENT INC.
AMERICAN HOMEPATIENT EAST, INC.
AMERICAN HOMEPATIENT OF NEW YORK, INC.
COLORADO HOME MEDICAL EQUIPMENT
ALLIANCE LLC
DESIGNATED COMPANIES, INC.
DOWNEAST MEDICAL SHOPPE
MEDICAL EQUIPMENT SERVICE, INC.
NATIONAL I.V., INC.
NATIONAL MEDICAL SYSTEMS, INC.
THE NATIONAL MEDICAL RENTALS, INC.
NORTHEAST PENNSYLVANIA ALLIANCE, LLC
NORTHWEST WASHINGTON ALLIANCE, LLC
SOUND MEDICAL EQUIPMENT, INC.
UNITED CLINICAL SERVICES, INC.
VOLUNTEER MEDICAL OXYGEN & HOSPITAL
EQUIPMENT COMPANY
On behalf of all of the above:
By:
----------------------------------------
Name:
Title:
S-2
AGENT: BANKERS TRUST COMPANY
as the Agent
By:
----------------------------------------
Name:
Title:
S-3
COLLECTION BANK: PNC BANK, NATIONAL ASSOCIATION
By:
----------------------------------------
Name:
Title:
S-4
SCHEDULE I
LIST OF DEPOSIT ACCOUNTS*
PLEDGOR ACCOUNT NUMBER
American HomePatient, Inc., a Delaware corporation 3002418121
3002418308
3002419386
3002419458
3002419853
0000000000
3004370133
American HomePatient, Inc., a Tennessee corporation 3002418498
3002418551
3002418666
3002419183
3002419263
3002419618
3002419677
3002419925
0000000000
3002420061
3002420192
3004369546
3004369669
3004369706
0000000000
3004369853
3004369909
3004370336
3002418893
3004370387
AHP Homecare Alliance of Virginia 3002418025
American HomePatient of Texas LP 3002418199
3002419757
AHP Knoxville Partnership 3002418252
AHP Home Care Alliance of Tennessee 3002418391
Volunteer Medical & Hospital Equipment Company 3002418447
Sound Medical Equipment, Inc. 3002419538
AHP Home Medical Equipment Partnership of Texas 3002420133
The National Medical Rentals, Inc. 3004369482
Colorado Home Medical Equipment Alliance, LLC 3004369597
American HomePatient of Arkansas, Inc. 3004369992
I-1
American HomePatient of Iowa, Inc. 3004370184
American HomePatient of New York, Inc. 3004370221
3002414972
Medical Equipment Service, Inc. 3004370424
AHP Alliance of Columbia 3002418607
* All deposit accounts are located at 000 X. Xxxxxxxxx Xx., Xxxxxxxxxx,
Xxxxxxxx 00000. The Article 9 jurisdiction is Kentucky.
S-2
