BB&T
FIRST AMENDED AND RESTATED LOAN AGREEMENT
EXHIBIT 10.38
7680024035
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Account Number
WHEREAS, UCI MEDICAL AFFILIATES, INC., UCI MEDICAL AFFILIATES OF SOUTH
CAROLINA, INC., DOCTORS CARE, P.A., DOCTOR'S CARE OF TENNESSEE, P.C.,
PROGRESSIVE PHYSICAL THERAPY, P.A., and CAROLINA ORTHOPEDIC & SPORTS MEDICINE,
P.A. (collectively, the "Borrowers") and BRANCH BANKING AND TRUST COMPANY OF
SOUTH CAROLINA, now known as BRANCH BANKING AND TRUST COMPANY, executed a Loan
Agreement ("Original Loan Agreement") on June 16, 2005, for a loan in amount of
$3,200,000.00 (the "Loan"); and
WHEREAS, the Original Loan Agreement was modified on November 30, 2007 to revise
certain provisions of the Loan terms ("First Loan Modification"); and
WHEREAS, the Original Loan Agreement was modified on January 22, 2009 to revise
certain provisions of the Loan terms and extend the maturity date of the Loan
("Second Loan Modification"); and
WHEREAS, the Borrowers and Branch Banking and Trust Company have agreed to renew
and modify the terms of the Loan as set forth herein and on any attachments
hereto (the "Third Loan Modification"); and
WHEREAS, as consideration for the Third Loan Modification, Branch Banking and
Trust Company has requested and the Borrowers have agreed to execute this First
Amended and Restated Loan Agreement to set forth the terms of the Third Loan
Modification and to amend, modify and replace the Original Loan Agreement in its
entirety with this agreement.
NOW THEREFORE, this First Amended and Restated Loan Agreement (the "Agreement")
is made this 23rd day of NOVEMBER, 2009 by and between BRANCH BANKING AND TRUST
COMPANY, a North Carolina banking corporation ("Bank"), and:
UCI MEDICAL AFFILIATES, INC., a Delaware corporation, having its chief
executive office at Columbia, South Carolina,
UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC., a South Carolina
corporation, having its chief executive office at Columbia, South Carolina,
DOCTORS CARE, P.A., a South Carolina corporation, having its chief
executive office at Columbia, South Carolina,
DOCTOR'S CARE OF TENNESSEE, P.C., a Tennessee corporation, having its chief
executive office at Columbia, South Carolina,
PROGRESSIVE PHYSICAL THERAPY, P.A., a South Carolina corporation, having
its chief executive office at Columbia, South Carolina, and
CAROLINA ORTHOPEDIC & SPORTS MEDICINE, P.A., a South Carolina corporation,
having its chief executive office at Columbia, South Carolina
(individually, each a "Borrower" and collectively, the "Borrowers").
The Borrowers have applied to Bank for and the Bank has agreed to make, subject
to the terms of this Agreement, the following loan(s) (hereinafter referred to,
singularly or collectively, if more than one, as "Loan(s)"):
Term Loan ("Term Loan") in the original principal amount of $3,200,000.00 for
the original purpose of refinancing existing debt of the Borrowers which was
evidenced by Borrowers' Promissory Note, dated June 16, 2005, as hereinafter
amended by Modification, Increase, Renewal and Restatement of Promissory Note,
dated of even date herewith payable in 48 consecutive monthly installments and
shall bear interest at a rate as described more particularly in such note, the
terms of which are incorporated herein by reference. The Term Loan shall mature
on October 5, 2013, when the entire unpaid principal balance then outstanding
plus accrued interest thereon shall be paid in full.
Additional terms, conditions and covenants of this Agreement are described in
Schedule DD, or other schedule attached hereto, the terms of which are
incorporated herein by reference. The promissory notes evidencing the Term Loan
are referred to herein as the "Note(s)" and shall include all extensions,
renewals, modifications and substitutions thereof. The Term Loan shall be
secured by the collateral described in the security documents described below.
Section 1 Conditions Precedent
The Bank shall not be obligated to make any disbursement of Loan proceeds until
all of the following conditions have been satisfied by proper evidence,
execution, and/or delivery to the Bank of the following items in addition to
this Agreement, all in form and substance satisfactory to the Bank and the
Bank's counsel in their sole discretion:
Note(s): The Note, originally dated June 15, 2005, as modified by Modification,
Increase, Renewal and Restatement of Promissory Note of even date,
evidencing the Loan(s) duly executed by the Borrowers.
Security Agreement(s): Security Agreement(s) in which Borrowers and any other
owner (a "Debtor") of personal property collateral shall grant to Bank a
first priority security interest in the personal property specified
therein. (If Bank has or will have a security interest in any collateral
which is inferior to the security interest of another creditor, Borrowers
must fully disclose to Bank any and all prior security interests, and Bank
must specifically approve any such security interest which will continue
during the Loan.)
Control Agreement: A Control Agreement pertaining to Deposit Accounts,
Letter-of-Credit Rights and/or Electronic Chattel Paper, as required in
connection with the Security Agreement(s).
UCC Financing Statements: Acknowledged copies of UCC Financing Statements duly
filed in Borrower's or other owner's state of incorporation, organization
or residence, and in all jurisdictions necessary, or in the opinion of the
Bank desirable, to perfect the security interests granted in the Security
Agreement(s), and certified copies of Information Requests identifying all
previous financing statements on record for the Borrowers or other owner,
as appropriate from all jurisdictions indicating that no security interest
has previously been granted in any of the collateral described in the
Security Agreement(s), unless prior approval has been given by the Bank.
Authorization and Certificate: An Authorization and Certificate executed by each
Debtor under which such Debtor authorizes Bank to file a UCC Financing
Statement describing collateral owned by such Debtor.
Corporate Resolution: A Corporate Resolution duly adopted by the Board of
Directors of the Borrowers authorizing the execution, delivery, and
performance of the Loan Documents on or in a form provided by or acceptable
to Bank.
Articles of Incorporation: A copy of the Articles of Incorporation and all other
charter documents of the Borrowers, all filed with and certified by the
Secretary of State of the State of each Borrower's incorporation.
By-Laws: A copy of the By-Laws of the Borrowers, certified by the Secretary of
the Borrowers as to their completeness and accuracy.
Certificate of Incumbency: A certificate of the Secretary of the Borrowers
certifying the names and true signatures of the officers of the Borrowers
authorized to sign the Loan Documents.
Certificate of Existence: A certification of the Secretary of State (or other
government authority) of the State of each Borrower's Incorporation or
Organization as to the existence or good standing of the Borrowers and
their charter documents on file.
Opinion of Counsel: An opinion of counsel for the Borrowers satisfactory to
the Bank and the Bank's counsel. Additional Documents: Receipt by the Bank of
other approvals, opinions, or documents as the Bank may reasonably request.
Section 2 Representations and Warranties
The Borrowers and any Guarantor(s) represent and warrant to Bank that:
2.01. Financial Statements. The balance sheet of each Borrower and its
subsidiaries, if any, and the related Statements of Income and Retained
Earnings of each Borrower and its subsidiaries, the accompanying footnotes
together with the accountant's opinion thereon, and all other financial
information previously furnished to the Bank, are true and correct and
fairly reflect the financial condition of each Borrower and its
subsidiaries as of the dates thereof, including all contingent liabilities
of every type, and the financial condition of each Borrower and its
subsidiaries as stated therein has not changed materially and adversely
since the date thereof. Each Guarantor further represents and warrants that
all financial statements provided by such Guarantor to Bank concerning such
Guarantor's financial condition are true and correct and fairly represent
such Guarantor's financial condition as of the dates thereof.
2.02. Name, Capacity and Standing. Each Borrower's exact legal name is correctly
stated in the initial paragraph of the Agreement. If the Borrower and/or
any Guarantor is a corporation, general partnership, limited partnership,
limited liability partnership, or limited liability company, each warrants
and represents that it is duly organized and validly existing under the
laws of its respective state of incorporation or organization; that it
and/or its subsidiaries, if any, are duly qualified and in good standing in
every other state in which the nature of their business shall require such
qualification, and are each duly authorized by their board of directors,
general partners or member/manager(s), respectively, to enter into and
perform the obligations under the Loan Documents.
2.03. No Violation of Other Agreements. The execution of the Loan Documents, and
the performance by each Borrower, by any and all pledgors (whether the
Borrowers or other owners of collateral property securing payment of the
Loan (hereinafter sometimes referred to as the "Pledgor")) or by the
Guarantor(s) thereunder will not violate any provision, as applicable, of
its articles of incorporation, by-laws, articles of organization, operating
agreement, agreement of partnership, limited partnership or limited
liability partnership, or, of any law, other agreement, indenture, note, or
other instrument binding upon the Borrower, Pledgor or Guarantor(s), or
give cause for the acceleration of any of the respective obligations of the
Borrowers or Guarantor(s).
2.04. Authority. All authority from and approval by any federal, state, or local
governmental body, commission or agency necessary to the making, validity,
or enforceability of this Agreement and the other Loan Documents has been
obtained.
2.05. Asset Ownership. The Borrowers and each Guarantor have good and marketable
title to all of the properties and assets reflected on the balance sheets
and financial statements furnished to the Bank, and all such properties and
assets are free and clear of mortgages, deeds of trust, pledges, liens, and
all other encumbrances except as otherwise disclosed by such financial
statements. In addition, each other owner of collateral has good and
marketable title to such collateral, free and clear of any liens, security
interests and encumbrances, except as otherwise disclosed to Bank.
2.06. Discharge of Liens and Taxes. Each Borrower and its subsidiaries, if any,
and each Guarantor have filed, paid, and/or discharged all taxes or other
claims which may become a lien on any of their respective properties or
assets, excepting to the extent that such items are being appropriately
contested in good faith and for which an adequate reserve (in an amount
acceptable to Bank) for the payment thereof is being maintained.
2.07. Regulation U. None of the Loan proceeds shall be used directly or
indirectly for the purpose of purchasing or carrying any margin stock in
violation of the provisions of Regulation U of the Board of Governors of
the Federal Reserve System.
2.08. ERISA. Each employee benefit plan, as defined by the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), maintained by each
Borrower or by any subsidiary of the Borrowers or Guarantor(s) meets, as of
the date hereof, the minimum funding standards of Section 302 of ERISA, all
applicable requirements of ERISA and of the Internal Revenue Code of 1986,
as amended, and no "Reportable Event" nor "Prohibited Transaction" (as
defined by ERISA) has occurred with respect to any such plan.
2.09. Litigation. There is no claim, action, suit or proceeding pending,
threatened or reasonably anticipated before any court, commission,
administrative agency, whether State or Federal, or arbitration which will
materially adversely affect the financial condition, operations,
properties, or business of each Borrower or its subsidiaries, if any, or
the Guarantor(s), or the ability of each Borrower or the Guarantor(s) to
perform their obligations under the Loan Documents.
2.10. Other Agreements. The representations and warranties made by Borrower to
Bank in the other Loan Documents are true and correct in all respects on
the date hereof.
2.11. Binding and Enforceable. The Loan Documents, when executed, shall
constitute valid and binding obligations of each Borrower and Guarantors
respectively, the execution of such Loan Documents has been duly authorized
by the parties thereto, and are enforceable in accordance with their terms,
except as may be limited by bankruptcy, insolvency, moratorium, or similar
laws affecting creditors' rights generally.
2.12. Commercial Purpose. The Loan(s) are not "consumer transactions", as
defined in the South Carolina Uniform Commercial Code, and none of the
collateral was or will be purchased or held primarily for personal, family
or household purposes.
Section 3 Affirmative Covenants
The Borrowers covenant and agree that from the date hereof and until
payment in full of all indebtedness and performance of all obligations owed
under the Loan Documents, Borrowers shall:
3.01. Maintain Existence and Current Legal Form of Business. (a) Maintain
its existence and good standing in the state of its incorporation or
organization, (b) maintain its current legal form of business indicated above,
and, (c), as applicable, qualify and remain qualified as a foreign corporation,
general partnership, limited partnership, limited liability partnership or
limited liability company in each jurisdiction in which such qualification is
required.
3.02. Maintain Records. Keep adequate records and books of account, in which
complete entries will be made in accordance with GAAP consistently applied,
reflecting all financial transactions of the Borrowers.
3.03. Maintain Properties. Maintain, keep, and preserve all of its properties
(tangible and intangible) including the collateral necessary or useful in
the conduct of its business in good working order and condition, ordinary
wear and tear excepted.
3.04. Conduct of Business. Continue to engage in an efficient, prudent, and
economical manner in a business of the same general type as now conducted.
3.05. Maintain Insurance. Maintain insurance with financially sound and
reputable insurance companies or associations in such amounts and covering
such risks as are usually carried by companies engaged in the same or a
similar business, and business interruption insurance if required by Bank,
which insurance may provide for reasonable deductible(s). The Bank shall be
named as loss payee (Long Form) on all policies which apply to the Bank's
collateral, and the Borrowers shall deliver certificates of insurance at
closing evidencing same. All such insurance policies shall provide, and the
certificates shall state, that no policy will be terminated without 20 days
prior written notice to Bank.
3.06. Comply With Laws. Comply in all respects with all applicable laws, rules,
regulations, and orders including, without limitation, paying before the
delinquency of all taxes, assessments, and governmental charges imposed
upon it or upon its property, and all Environmental Laws.
3.07. Right of Inspection. Permit the officers and authorized agents of the
Bank, at any reasonable time or times in the Bank's sole discretion, to
examine and make copies of the records and books of account of, to visit
the properties of the Borrowers, and to discuss such matters with any
officers, directors, managers, members or partners, limited or general of
the Borrowers, and the Borrowers' independent accountant as the Bank deems
necessary and proper.
3.08. Reporting Requirements. Furnish to the Bank:
Financial Statements: As soon as available and not more than sixty
(60) days after the end of each quarter, balance sheets, statements
of income, cash flow, and retained earnings for the period ended and
a statement of changes in the financial position, all in reasonable
detail, and all prepared in accordance with GAAP consistently applied
and certified as true and correct by an officer, general partner or
manager (or member(s)) of the Borrowers, as appropriate.
Annual Financial Statements: As soon as available and not more than
one hundred twenty (120) days after the end of each fiscal year,
balance sheets, statements of income, and retained earnings for the
period ended and a statement of changes in the financial position,
all in reasonable detail, and all prepared in accordance with GAAP
consistently applied. The financial statements must be of the
following quality or better: Audited.
Loan Base Report: On or before the 15th day of each Month, or as
provided and/or required in accordance with Schedule DD, Schedule GC
or Schedule DD-FC, a Loan Base Report in a form acceptable to Bank
signed by the President, chief financial officer, general partner or
manager (or members) of the Borrowers, as appropriate.
Notice of Litigation: Promptly after the receipt by the Borrowers, or
by any Guarantor of which Borrowers have knowledge, of notice or
complaint of any action, suit, and proceeding before any court or
administrative agency of any type which, if determined adversely,
could have a material adverse effect on the financial condition,
properties, or operations of the Borrowers or Guarantor, as
appropriate.
Tax Returns: As soon as available each year, complete copies
(including all schedules) of all state and federal tax returns filed
by Borrowers. Notice of Default: Promptly upon discovery or knowledge
thereof, notice of the existence of any event of default under this
Agreement or any other Loan Documents.
Other Information: Such other information as the Bank may from time to time
reasonably request.
3.09. Deposit Accounts. Maintain substantially all of its demand
deposit/operating accounts with the Bank.
3.10. Affirmative Covenants from other Loan Documents. All affirmative
covenants contained in any Mortgage, Deed of Trust, Security Agreement,
Assignment of Leases and Rents, or other security document executed by the
Borrowers which are described in paragraph 2 hereof are hereby incorporated by
reference herein.
3.11. Lockbox. All receivables of Borrowers shall be collected through a lockbox
maintained with Bank.
Section 4 Guarantor(s) Covenants: [INTENTIONALLY DELETED]
Section 5 Financial Covenants
Borrowers covenant and agree that from the date hereof until payment in full of
all indebtedness and the performance of all obligations under the Loan
Documents, the Borrowers shall at all times maintain the following financial
covenants and ratios all in accordance with GAAP unless otherwise specified:
Debt Service Coverage Ratio. Maintained at a ratio greater than 1.45 times. Debt
Service Coverage is defined as earnings before interest, taxes, depreciation and
amortization divided by Annual Debt Service.
Maximum Funded Debt to EBDITA Ratio. Maximum Funded Debt divided by earnings
before interest, taxes, depreciation and amortization maintained at a ratio less
than 2.5 times. Maximum Funded Debt is defined as all notes payable, long-term
debt, current maturities of long-term debt and all pre-petition debt.
Tangible Net Worth. A minimum tangible net worth of not less than $8,000,000.00.
Tangible Net Worth is defined as net worth, plus obligations contractually
subordinated to debts owed to Bank, minus goodwill, contract rights, and assets
representing claims on stockholders or affiliated entities.
Maximum Debt to Tangible Net Worth. A ratio of total liabilities to
tangible net worth of not greater than 2.50 to 1.00.(1)
Section 6 Negative Covenants
Each Borrower covenants and agrees that from the date hereof and until payment
in full of all indebtedness and performance of all obligations under the Loan
Documents, the Borrowers shall not, without the prior written consent of the
Bank:
6.01. Liens. Create, incur, assume, or suffer to exist any lien upon or
with respect to any of Borrower's properties, or the properties of any
Pledgor securing payment of the Loan, now owned or hereafter acquired,
except:
(a) Liens and security interests in favor of the Bank;
(b) Liens for taxes not yet due and payable or otherwise being contested
in good faith and for which appropriate reserves are maintained; (c)
Other liens imposed by law not yet due and payable, or otherwise being
contested in good faith and for which appropriate reserves are
maintained;
(d) Purchase money security interests on any property hereafter acquired,
provided that such lien shall attach only to the property acquired.
6.02. Debt. Create, incur, assume, or suffer to exist any debt, except: (a)
Debt to the Bank;
(b) Debt outstanding on the date hereof and shown on the most recent
financial statements submitted to the Bank;
(c) Accounts payable to trade creditors incurred in the ordinary course of
business; (d) Debt secured by purchase money security interests as
outlined above in Section 6.01 (d); (e) [Intentionally Deleted.] 6.03.
[Intentionally Deleted.] 6.04. Change of Legal Form of Business;
Purchase of Assets. Change Borrower's name or the legal form of
Borrower's business as shown above, whether by merger, consolidation,
conversion or otherwise, or purchase all or substantially all of the assets
or business of any Person.
6.05. [Intentionally Deleted.]
6.06. Dividends or Distributions; Acquisition of Capital Stock or Other
Ownership Interests. Declare or pay any dividends or distributions of any
kind, or purchase or redeem, retire, or otherwise acquire any of Borrower's
capital stock or other ownership interests, now or hereafter outstanding.
6.07. [Intentionally Deleted.]
6.08. Guaranties. Assume, guarantee, endorse, or otherwise be or become directly
or contingently liable for obligations of any Person, except guaranties by
endorsement of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business.
6.09. Loans. Loans to directors, officers, partners, members, shareholders,
subsidiaries and affiliates. Any loans currently outstanding shall be and
shall remain subordinate to the Loan(s).
6.10. Disposition of Assets. Sell, lease, or otherwise dispose of any of its
assets or properties except in the ordinary and usual course of its
business.
6.11. Transfer of Ownership. If Borrower is a corporation, (a) issue, transfer
or sell any new class of stock, or (b) issue, transfer or sell, in the
aggregate, from its treasury stock and/or currently authorized but unissued
shares of any class of stock, more than 10% of the total number of all such
issued and outstanding shares as of the date of this Agreement.
BlueCross/BlueShield shall maintain its ownership interest in UCI Medical
Affiliates, Inc. at 48% or higher.
6.12. Negative Covenants from other Loan Documents. All negative covenants
contained in any Mortgage, Security Agreement, Assignment of Leases or
Rents, or other security document executed by the Borrowers which are
described in paragraph 2 hereof are hereby incorporated by reference
herein.
Section 7 Hazardous Materials and Compliance with Environmental Laws:
[INTENTIONALLY DELETED]
Section 8 Events of Default
The following shall be "Events of Default" by Borrowers or any Guarantor:
8.01. The failure to make prompt payment of any installment of principal or
interest on any of the Note(s) when due or payable. 8.02. Should any
representation or warranty made in the Loan Documents prove to be false or
misleading in any material respect.
8.03. Should any report, certificate, financial statement, or other
document furnished prior to the execution of or pursuant to the terms of
this Agreement prove to be false or misleading in any material respect.
8.04. Should the Borrowers or any Guarantor default on the performance of
any other obligation of indebtedness when due or in the performance of any
obligation incurred in connection with money borrowed. 8.05. Should the
Borrowers, any Guarantor or any Pledgor breach any covenant, condition, or
agreement made under any of the Loan Documents.
8.06. Should a custodian be appointed for or take possession of any or all
of the assets of the Borrowers or any Guarantor, or should the Borrowers or
any Guarantor either voluntarily or involuntarily become subject to any
insolvency proceeding, including becoming a debtor under the United States
Bankruptcy Code, any proceeding to dissolve the Borrowers or any Guarantor,
any proceeding to have a receiver appointed, or should the Borrowers or any
Guarantor make an assignment for the benefit of creditors, or should there
be an attachment, execution, or other judicial seizure of all or any
portion of each Borrower's or any Guarantor's assets, including an action
or proceeding to seize any funds on deposit with the Bank, and such seizure
is not discharged within 30 days.
8.07. Should final judgment for the payment of money be rendered against
the Borrowers or any Guarantor which is not covered by insurance and shall
remain undischarged for a period of 30 days unless such judgment or
execution thereon be effectively stayed.
8.08. Upon the death of, or termination of existence of, or dissolution of,
any Borrower, Pledgor or Guarantor. 8.09. Should the Bank in good xxxxx
xxxx itself, its liens and security interests, if any, or any debt
thereunder unsafe or insecure, or should the Bank believe in good faith
that the prospect of payment of any debt or other performance by the
Borrowers or any Guarantor is impaired.
8.10. Should any lien or security interest granted to Bank to secure
payment of the Note(s) terminate, fail for any reason to have the priority
agreed to by Bank on the date granted, or become unperfected or invalid for
any reason.
8.11. An Event of Default under the Term Loan shall constitute and event of
default under (i) all other loans between Bank and the Borrowers, and (ii)
that certain between Bank and UCI Properties, LLC, dated February 13, 2009
("UCI Properties Loan").
8.12. An Event of Default under the UCI Properties Loan shall constitute an
Event of Default under the Term Loan.
Section 9 Remedies Upon Default
Upon the occurrence of any of the above listed Events of Default, the Bank may
at any time thereafter, at its option, take any or all of the following actions,
at the same or at different times:
9.01. Declare the balance(s) of the Note(s) to be immediately due and
payable, both as to principal and interest, without presentment, demand,
protest, or notice of any kind, all of which are hereby expressly waived by
Borrowers and each Guarantor, and such balance(s) shall accrue interest at
the Default Rate as provided herein until paid in full; 9.02. Require the
Borrowers or Guarantor(s) to pledge additional collateral to the Bank from
each Borrower's or any Guarantor's assets and properties, the acceptability
and sufficiency of such collateral to be determined in the Bank's sole
discretion; 9.03. Take immediate possession of and foreclose upon any or
all collateral which may be granted to the Bank as security for the
indebtedness and obligations of Borrowers or any Guarantor under the Loan
Documents; 9.04. Exercise any and all other rights and remedies available
to the Bank under the terms of the Loan Documents and applicable law,
including the South Carolina Uniform Commercial Code; 9.05. Any obligation
of the Bank to advance funds to the Borrowers or any other Person under the
terms of under the Note(s) and all other obligations, if any, of the Bank
under the Loan Documents shall immediately cease and terminate unless and
until Bank shall reinstate such obligation in writing.
Section 10 Miscellaneous Provisions
10.01. Definitions.
"Default Rate" shall mean a rate of interest equal to Bank's Prime Rate
plus five percent (5%) per annum (not to exceed the legal maximum rate)
from and after the date of an Event of Default hereunder which shall apply,
in the Bank's sole discretion, to all sums owing, including principal and
interest, on such date.
"Environmental Laws" shall mean all applicable federal and state
environmental laws and regulations which affect or may affect the Mortgaged
Property, including without limitation the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. Sections 9601 et
seq.), the Resource Conservation and Recovery Act (42 U.S.C. Sections 6901
et seq.), the Federal Water Pollution Control Act (33 U.S.C. Sections 1251
et seq.), the Clean Air Act (42 U.S.C. Section 7401 et seq.), the Toxic
Substances Control Act (15 U.S.C. Section 2601 et seq.) as such laws or
regulations have been amended or may be amended.
"Loan Documents" shall mean this Agreement including any schedule
attached hereto, the Note(s), the Deed(s) of Trust, the Mortgage(s), the
Security Agreement(s), the Assignment(s) of Leases and Rents, all UCC
Financing Statements, the Guaranty Agreement(s), and all other documents,
certificates, and instruments executed in connection therewith, and all
renewals, extensions, modifications, substitutions, and replacements
thereto and therefore.
"Person" shall mean an individual, partnership, corporation, trust,
unincorporated organization, limited liability company, limited liability
partnership, association, joint venture, or a government agency or
political subdivision thereof.
"GAAP" shall mean generally accepted accounting principles as
established by the Financial Accounting Standards Board or the American
Institute of Certified Public Accountants, as amended and supplemented from
time to time.
"Prime Rate" shall mean the rate of interest per annum announced by the
Bank from time to time and adopted as its Prime Rate, which is one of
several rate indexes employed by the Bank when extending credit, and may
not necessarily be the Bank's lowest lending rate.
10.02. Non-impairment. If any one or more provisions contained in the Loan
Documents shall be held invalid, illegal, or unenforceable in any respect,
the validity, legality, and enforceability of the remaining provisions
contained therein shall not in any way be affected or impaired thereby and
shall otherwise remain in full force and effect.
10.03. Applicable Law. The Loan Documents shall be construed in accordance
with and governed by the laws of the State of South Carolina. 10.04.
Waiver. Neither the failure nor any delay on the part of the Bank in
exercising any right, power or privilege granted in the Loan Documents
shall operate as a waiver thereof, nor shall any single or partial exercise
thereof preclude any other or further exercise of any other right, power,
or privilege which may be provided by law.
10.05. Modification. No modification, amendment, or waiver of any provision
of any of the Loan Documents shall be effective unless in writing and
signed by the Borrowers and Bank. 10.06. Payment Amount Adjustment. In the
event that any Loan(s) referenced herein has a variable (floating) interest
rate and the interest rate increases, Bank, at its sole discretion, may at
any time adjust the Borrowers' payment amount(s) to prevent the amount of
interest accrued in a given period to exceed the periodic payment amount or
to cause the Loan(s) to be repaid within the same period of time as
originally agreed upon.
10.07 Stamps and Fees. The Borrowers shall pay all federal or state stamps,
taxes, or other fees or charges, if any are payable or are determined to be
payable by reason of the execution, delivery, or issuance of the Loan
Documents or any security granted to the Bank; and the Borrowers and
Guarantor agree to indemnify and hold harmless the Bank against any and all
liability in respect thereof.
10.08. Attorneys' Fees. In the event the Borrowers or any Pledgor or
Guarantor shall default in any of its obligations hereunder and the Bank
believes it necessary to employ an attorney to assist in the enforcement or
collection of the indebtedness of the Borrowers to the Bank, to enforce the
terms and provisions of the Loan Documents, to modify the Loan Documents,
or in the event the Bank voluntarily or otherwise should become a party to
any suit or legal proceeding (including a proceeding conducted under the
Bankruptcy Code), the Borrowers and Guarantors agree to pay the reasonable
attorneys' fees of the Bank and all related costs of collection or
enforcement that may be incurred by the Bank. The Borrowers and Guarantor
shall be liable for such attorneys' fees and costs whether or not any suit
or proceeding is actually commenced. 10.09. Bank Making Required Payments.
In the event Borrowers shall fail to maintain insurance, pay taxes or
assessments, costs and expenses which Borrowers are, under any of the terms
hereof or of any Loan Documents, required to pay, or fail to keep any of
the properties and assets constituting collateral free from new security
interests, liens, or encumbrances, except as permitted herein, Bank may at
its election make expenditures for any or all such purposes and the amounts
expended together with interest thereon at the Default Rate, shall become
immediately due and payable to Bank, and shall have benefit of and be
secured by the collateral; provided, however, the Bank shall be under no
duty or obligation to make any such payments or expenditures.
10.10. Right of Offset. Any indebtedness owing from Bank to Borrowers may
be set off and applied by Bank on any indebtedness or liability of
Borrowers to Bank, at any time and from time to time after maturity,
whether by acceleration or otherwise, and without demand or notice to
Borrowers. Bank may sell participations in or make assignments of any Loan
made under this Agreement, and Borrowers agree that any such participant or
assignee shall have the same right of setoff as is granted to the Bank
herein. 10.11. UCC Authorization. Borrowers authorize Bank to file such UCC
Financing Statements describing the collateral in any location deemed
necessary and appropriate by Bank.
10.12. Modification and Renewal Fees. Bank may, at its option, charge any
fees for modification, renewal, extension, or amendment of any terms of the
Note(s) permitted by permitted by law. 10.13. Conflicting Provisions. If
provisions of this Agreement shall conflict with any terms or provisions of
any of the Note(s), Mortgage(s) or security document(s) or any schedule
attached hereto, the provisions of such Note(s), Mortgage(s), or security
document(s) or any schedule attached hereto, as appropriate, shall take
priority over any provisions in this Agreement.
10.14. Notices. Any notice permitted or required by the provisions of this
Agreement shall be deemed to have been given when delivered in writing to
the City Executive or any Vice President of the Bank at its offices in
Columbia, South Carolina, and to the President of the Borrowers at its
offices in Columbia, South Carolina when sent by certified mail and return
receipt requested.
10.15. Consent to Jurisdiction. Borrowers hereby irrevocably agree that any
legal action or proceeding arising out of or relating to this Agreement may
be instituted in the Court of Common Pleas in Richland County, South
Carolina, or the United States District Court for South Carolina, Columbia
Division or in such other appropriate court and venue as Bank may choose in
its sole discretion. Borrowers consent to the jurisdiction of such courts
and waive any objection relating to the basis for personal or in rem
jurisdiction or to venue which Borrowers may now or hereafter have in any
such legal action or proceedings. 10.16. Counterparts. This Agreement may
be executed by one or more parties on any number of separate counterparts
and all of such counterparts taken together shall be deemed to constitute
one and the same instrument.
10.17. Entire Agreement. The Loan Documents embody the entire agreement
between Borrowers and Bank with respect to the Loans, and there are no oral
or parol agreements existing between Bank and Borrowers with respect to the
Loans which are not expressly set forth in the Loan Documents. 10.18.
Cross-Collateralization. The collateral securing the Term Loan shall also
serve as collateral securing the UCI Properties Loan. The collateral
securing the UCI Properties Loan shall also serve as collateral securing
the Term Loan.
[SIGNATURES ON FOLLOWING PAGE]
SIGNATURE PAGE
IN WITNESS WHEREOF, the Bank, Borrowers and Guarantor(s) have caused this
Agreement to be duly executed under seal all as of the date first above written.
Each Borrower is a Corporation:
WITNESS: UCI MEDICAL AFFILIATES, INC.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ----------------------------------------------------------
----------
Title: Chief Executive Officer
----------------------------------------------------------
WITNESS: UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ----------------------------------------------------------
----------
Title: Chief Executive Officer
----------------------------------------------------------
WITNESS: DOCTORS CARE, P.A.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ----------------------------------------------------------
----------
Title: President
----------------------------------------------------------
WITNESS: DOCTOR'S CARE OF TENNESSEE, P.C.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ----------------------------------------------------------
----------
Title: President
----------------------------------------------------------
WITNESS: PROGRESSIVE PHYSICAL THERAPY, P.A.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s Xxxxxx X. Xxxxx
---------- ------------------------------------------------- ----------------------------------------------------------
----------
Title: Treasurer
----------------------------------------------------------
WITNESS: CAROLINA ORTHOPEDIC & SPORTS MEDICINE, P.A
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ----------------------------------------------------------
----------
Title: President
----------------------------------------------------------
Bank:
WITNESS: BRANCH BANKING AND TRUST COMPANY
/s Xxxxx X. Xxxxxx By: /s X. X. Xxxxxxxxx, Xx.
--------------- -------------------------------------------- ----------------------------------------------------------
X. X.
Xxxxxxxxx, Xx.
Title: Senior
Vice President
----------------------------------------------------------
SCHEDULE "DD" TO BB&T LOAN AGREEMENT
This Schedule "DD" is an attachment to and a part of the Loan Agreement
(the "Loan Agreement") dated NOVEMBER 23, 2009 between BRANCH BANKING AND TRUST
COMPANY ("Bank") and UCI MEDICAL AFFILIATES, INC., UCI MEDICAL AFFILIATES OF
SOUTH CAROLINA, INC., DOCTORS CARE, P.A., DOCTOR'S CARE OF TENNESSEE, P.C.,
PROGRESSIVE PHYSICAL THERAPY, P.A., and CAROLINA ORTHOPEDIC & SPORTS MEDICINE,
P.A. (hereinafter referred to collectively as the "Borrowers").
DD.01. Definitions. In addition to the words and terms defined elsewhere in this
Schedule DD, the Loan Agreement and the Uniform Commercial Code of South
Carolina, as amended from time to time, (the "UCC") the following terms
shall have the following specified meanings:
(a) Account Debtor. Any Person obligated to Borrowers on an Account.
(b) Account(s). Any right to payment of a monetary obligation, whether or not
earned by performance, including without limitation any receivable,
contract right, note, draft, instrument, acceptance, chattel paper, lease,
or other writing or open account resulting from the sale, lease, license,
assignment or other disposal of property by Borrowers, or from services
rendered or to be rendered by Borrowers.
(c) Advance Rate. The percentage of the total value of Eligible Accounts,
Eligible Inventory, Eligible Export-Related Accounts, Eligible
Export-Related Inventory, or Other Collateral Bank will lend to Borrowers,
as set forth in Section DD.02.
(d) Asset Based Lending Credit Line Sweep Services Agreement. If applicable,
that agreement between Bank and Borrowers whereby Borrowers agree that all
remittances in payment of Accounts shall be deposited in its designated
Collateral Reserve Account, Operating Account, or Medicare Receivables
Account, as applicable, and shall be administered and applied in accordance
with the ABL Credit Line Sweep Services Agreement. This agreement is to be
read in conjunction with, and is a part of, the Treasury Management
Agreement, the Loan Agreement and this Schedule DD.
(e) Asset Based Sweep Services Attachment. If applicable, that agreement
between Bank and Borrowers whereby Borrowers agree that all remittances in
payment of Accounts which are deposited to the Collateral Reserve Account
will be applied to the outstanding Line of Credit, as well as other
provisions of the Loan Documents. This agreement is to be read in
conjunction with, and is a part of, the Treasury Management Agreement, the
Loan Agreement, and this Schedule DD.
(f) Availability. The lesser of the Bank's Line of Credit or Collateral Loan
Value reduced by (i) the principal balance outstanding under the Line of
Credit, (ii) the Letter of Credit Exposure Reserve, and (iii) the
Availability Reserve as determined by Bank from the most recent Loan Base
Report and otherwise in the sole discretion of the Bank after consideration
of Collections.
(g) Availability Reserve. A reserve against Availability determined by Bank in
its sole discretion from time to time to reflect events, conditions,
contingencies or risks or other loans of Bank which without limitation do
or may affect the Collateral Loan Value, the business prospects of
Borrowers or any Account Debtor, or the security interest of Bank,
including enforceability, perfection and the priority thereof.
(h) Xxxx and Hold. An Account generated by the sale of goods for which an
invoice has been issued to the buyer, but the goods represented by such
Account remain undelivered to the buyer and/or under the control of
Borrowers or Borrowers' representative.
(i) Collateral. Collateral shall mean the assets and property described in the
Security Agreement including, without limitation, Borrowers' Accounts,
Inventory and Other Collateral.
(j) Collections. Collections shall be deemed to include Proceeds of Collateral,
in any form received by Bank pursuant to a Lockbox Agreement, or deposited
in a Collateral Reserve Account or an Operating Account or a Medicare
Receivables Account or other account maintained with Bank, or any other
account maintained for the benefit of the Bank, such as a blocked account,
which Collections shall be the exclusive and sole property of Bank to the
extent applied to the outstanding balance of the Line of Credit.
(k) Collateral Loan Value. The aggregate value of the Advance Rate as applied
to the Eligible Accounts, and/or Eligible Export-Related Accounts, the
Advance Rate as applied to the Eligible Inventory and/or Eligible
Export-Related Inventory and the Advance Rate applied to the value of Other
Collateral, if any.
(l) Collateral Reserve Account. The demand deposit account maintained with Bank
by Borrowers into which all proceeds of the Collateral shall be deposited
and to which only Bank will have access. On the date hereof, the Collateral
Reserve Account number with respect to the Line of Credit (domestic and/or
foreign) is n/a (domestic) and n/a (foreign) and shall be deemed to include
any substitute or replacement account at Bank.
(m) Contra Account. An Account subject to offset, in the sole discretion of
Bank, by an Account Debtor of Borrowers.
(n) Credit Insurance. A policy of credit insurance, satisfactory to Bank,
insuring Accounts collaterally assigned to Bank naming Bank as a "loss
payee."
(o) Cross Aging Rule. Should any Account due Borrowers from an Account Debtor
have 50% (upon notice, such other percentage as Bank in its discretion
shall determine) or more of their total aggregate Accounts aged in excess
of the Eligibility Period, then all Accounts from such Account Debtor shall
be deemed ineligible.
(p) Eligible Account and/or Eligible Inventory. An Eligible Account is an
Account which is not an Ineligible Account, as defined in Section DD.03
hereof; and Eligible Inventory is Inventory which is not Ineligible
Inventory, as defined in Section DD.04 hereof.
(q) Eligible Export-Related Account and/or Eligible Export-Related Inventory.
An Eligible Export-Related Account is a foreign account which is not an
Ineligible Foreign Account, as defined in Section DD.03 hereof; and
Eligible Export-Related Inventory is Inventory which is not Ineligible
Export-Related Inventory as defined in Section DD.04 hereof.
(r) Eligibility Period. The Eligibility Period for any Account shall mean not
more than 90 days from the original invoice date.
(s) Exam. Exam means those examinations on the premises of Borrowers or
wherever books, records, or Collateral are located, however maintained,
including but not limited to the inspection of Inventory, and standard
testing of such books and records by Bank's representatives, at any time
during normal business hours of Borrowers, with or without prior notice to
Borrowers from Bank, as provided in Section DD.06(b).
(t) Excess Inventory. That level of Inventory on hand determined by Bank to be
in excess of a n/a months supply of Borrowers' requirements therefor
unless, upon written notice by Bank, Bank in its discretion shall determine
a greater or lesser level of Inventory.
(u) Fees. Those fees which Borrowers will pay to Bank in conjunction with
Bank's asset based lending services as set forth in Section DD-07 hereof,
whether or not actual loan obligations exist, while the Loan Agreement is
in force.
(v) Foreign Accounts. Any Account due from any Person located outside the fifty
states comprising the United States of America and the District of Columbia
unless the Account is due from a Person located in a country, commonwealth
and/or possession identified in Section DD.02(f) hereof.
(w) Government Account. Any Account owed by the United States of America or any
state or political subdivision thereof, or any department, agency,
authority, board or instrumentality thereof.
(x) Ineligible Accounts and/or Ineligible Inventory. Shall have the meanings
given in Sections DD.03 and DD.04 hereof.
(y) Ineligible Export-Related Accounts and/or Ineligible Export-Related
Inventory. Shall have the meaning given in Sections DD.03 and DD.04 hereof.
(z) Intellectual Property. Property of any Person constituting under any
applicable federal or state law a patent, copyright, trademark, service
xxxx, trade name, trade secret, or license or other right to use any of the
foregoing.
(aa) Inter-Company Account. With the exception of Blue Cross/Blue Shield and its
family of companies, any Account from any Account Debtor with Borrowers in
any manner including, without limitation, as owner, member, partner,
shareholder, officer, director, employee, agent, or which is an affiliate
of Borrowers.
(bb) Inventory. Goods which are leased or held by Borrowers for sale or lease as
lessor or furnished under a contract of service, and shall include goods,
finished goods, raw materials, work-in-process, and materials to be used
and/or consumed in a business and proceeds thereof including Accounts and
Chattel Paper.
(cc) Inventory Caps. The maximum loan amount Bank may lend against the Eligible
Inventory and/or Eligible Export-Related Inventory, as set forth in Section
DD.02(c) and (d).
(dd) Letter of Credit. Any Letter of Credit issued by Bank on behalf of
Borrowers, as Applicant; provided, however, inclusion of this definition
shall not imply, or be construed as, a commitment by Bank to issue any
Letters of Credit.
(ee) Letter of Credit Exposure Reserve. At any given date, the aggregate face
amount of outstanding Letters of Credit on such date plus the aggregate
amount of drafts drawn under or purporting to be drawn under Letters of
Credit that have been paid by Bank and for which Bank has not been
reimbursed.
(ff) License Agreement. An agreement between Borrowers and Licensor pursuant to
which Borrowers are authorized to use such Licensor's Intellectual Property
in connection with the manufacturing, sale or other transfer or
distribution of Inventory.
(gg) Licensor. Any Person from whom Borrowers obtain a License Agreement.
(hh) Licensor/Bank Agreement. An agreement satisfactory to Bank among Borrowers,
Bank and Licensor pursuant to which Licensor consents and authorizes Bank
to enforce its security interests and liens against Inventory with the
benefit of the Intellectual Property regardless of whether Borrowers have
defaulted under a License Agreement therefor.
(ii) Line of Credit. The amount of each Line of Credit (domestic and/or foreign)
approved by Bank and set forth in the Loan Agreement.
(jj) Loan Base Report. That report on Bank's standard form, or in a form
otherwise acceptable to Bank, to be prepared, signed, dated and delivered
by Borrowers in accordance with Bank's instructions, and submitted to Bank
by Borrowers at specified intervals and/or occasions, and detailing
pertinent information as regards Accounts and/or Inventory and/or Other
Collateral, Reserves, Collateral Loan Value, outstanding Line of Credit
balance, and Availability.
(kk) Lockbox Agreement. That agreement on Bank's standard form, or in a form
otherwise acceptable to Bank, to be executed by Borrowers relating to the
provision for lockbox services and requirements.
(ll) Medicare Receivable. A Government Account arising from the provision of
Medicare products and services by Borrowers as an eligible provider and/or
supplier of Medicare products or services.
(mm) Medicare Receivables Account. A deposit account in Borrowers' name only
maintained at Bank into which proceeds/payments of Medicare Receivables
shall be deposited; and, notwithstanding any provision in the Loan
Agreement, this Schedule or other agreements between Borrowers and Bank,
the Bank shall not have a right of offset, and by execution hereof does
hereby waive, such right of offset to the proceeds/payments of Medicare
Receivables deposited to such account.
(nn) Operating Account. Operating Account shall mean the Borrowers' demand
deposit account at any time with Bank, currently account number 5123946008
or any substitute or replacement account at Bank.
(oo) Other Collateral. Collateral that shall be included in Collateral Loan
Value, other than Accounts or Inventory, as specifically approved and
determined by Bank in its sole discretion.
(pp) Person. Any individual, corporation, general or limited partnership,
limited liability company or partnership, limited liability limited
partnership, trust, unincorporated organization, association, joint
venture, or a state or federal government agency or political subdivision
thereof.
(qq) Proceeds. Proceeds shall have the meaning given to it under the UCC and
shall include without limitation the collections and distributions of
Collateral, cash or non-cash.
(rr) Reserves. Aggregate deductions from the Collateral Loan Value and/or
Availability as determined by Bank from time to time, including, but not
limited to, Letter of Credit Exposure Reserve and the Availability Reserve.
DD.02. Advance Rates/Advances/ Prepayment and Other Provisions.
Bank agrees that the Advance Rates to be used to calculate the
Collateral Loan Value shall be: (a) 55% against the Eligible Accounts.
(b) 25% against the Borrowers' Medicare, Medicaid and other Federal
account receivables shal be eligible collateral to the extent
Borrowers' have an interest and are permitted by all applicable laws to
have an interest in such accounts.
(c) Against the Eligible Inventory as follows: Inventory Sublimits:
n/a% Finished Inventory $ n/a
--- ----
n/a % Raw Materials Inventory $ n/a
--- ----
n/a % Work in Process Inventory $ n/a
--- ----
n/a % In Transit Inventory $ n/a
--- ----
n/a % Other Eligible Inventory n/a $ n/a
---- ----
Subtotal: $ n/a
(d) Against Eligible Export-Related Inventory as follows:
n/a % Finished Inventory $ n/a
--- ----
n/a % Raw Materials Inventory $ n/a
--- ----
n/a % Work in Process Inventory $ n/a
--- ----
n/a % Other Eligible Inventory n/a $ n/a
--- --- ----
Subtotal: $ n/a
Inventory values will not exceed the lower of cost or market and, if
required by Bank, will be reduced by the LIFO reserve. The aggregate
loan advances against Eligible Inventory shall not exceed at any time
the foregoing Inventory Sublimits or Subtotals or an Aggregate
Inventory Sublimit of $ n/a (the "Inventory Caps").
(e) Other Collateral shall be included in the Collateral Loan Value as
approved by Bank from time to time, together with an Advance Rate
determined by Bank from time to time. (f) Any Account due from a Person
located in the following identified countries, commonwealths, and/or
possessions shall not be deemed a Foreign Account: (list) n/a.
(g) Notwithstanding that the following Account Debtor(s) shall be
ineligible pursuant to the terms hereof, such Account Debtor(s) shall
nonetheless be deemed eligible by Bank, subject to any limitations
and/or advance provisions set forth below, until Bank, upon written
notice, in its sole discretion, shall provide otherwise:
Account Debtor/Address Limitations/Advance Provisions
n/a n/a
--- ---
n/a n/a
--- ---
n/a n/a
--- ---
n/a n/a
--- ---
n/a n/a
--- ---
n/a n/a
--- ---
n/a n/a
--- ---
Bank reserves the right, upon notice, in its sole discretion, to amend
the Eligibility Period, Inventory Caps, Reserves, or the provisions of
Section DD.02(f) and (g) at any time; and, the Loan Base Report, upon
receipt by Bank, shall be subject to Bank's satisfactory review,
acceptance or correction.
Bank agrees to (i) make advances under the Line of Credit
automatically, without any request by Borrowers upon the presentment of
items drawn against Borrowers' operating account, provided the
Availability, as shown upon a current acceptable Loan Base Report as
required herein, and otherwise determined by Bank in its sole
discretion after consideration of Collections, is sufficient to cover
such advances, or (ii) fund the operating account based on request(s)
for advances from Borrowers orally or in writing provided the
Availability is sufficient to cover such advances. Borrowers shall
submit a completed Loan Base Report to Bank as required, so long as the
Line of Credit shall exist, regardless of the outstanding balance
thereof. It is further provided that Borrowers release Bank from any
liability or obligation for and agrees to indemnify and hold Bank
harmless from and against any loss, cost, damage or expense (including
Bank's reasonable attorneys' fees) incurred or suffered as a result of
the payment by Bank of any item drawn against Borrowers' checking
account that is subsequently determined to have been improperly paid
for any reason, except for the gross negligence or willful misconduct
of Bank. Bank also reserves the right, upon notice, in its sole
discretion, to discontinue the automatic payment of items presented to
Bank, and to require written or oral advance requests to be made by
Borrowers.
Bank is authorized (without any further request from Borrowers) to
advance on behalf of Borrowers as a Loan all sums required to be paid
by Borrowers to Bank in respect of any Letter of Credit pursuant to the
terms of the Application for Letter of Credit (including all fees
associated therewith), but Bank shall have no obligation to make such a
Loan.
Bank may debit the amount of any payment due under the Loan Agreement
and this Schedule DD from the Operating Account, any deposit account or
loan account of Borrowers maintained with Bank, but Bank shall have no
obligation to do so.
If the principal balance outstanding at any time under the Line of
Credit exceeds the lesser of the approved maximum amount of the Line of
Credit or the Collateral Loan Value reduced by the Reserves (herein an
"Overadvance"), Borrowers shall immediately prepay the Line of Credit
to the extent necessary to eliminate such excess. For so long as the
Overadvance shall exist and be continuing, and without prejudice to any
other rights Bank may have hereunder, Bank shall be authorized upon
written notice to Borrowers to assess an overadvance fee as determined
by Bank in its discretion in an amount up to 1% of the Overadvance but
not less than $1,000.00, subject to such other minimum amount as Bank
in its discretion upon notice to Borrowers shall determine.
DD.03. Ineligible Accounts.
Ineligible Accounts shall include the following:
(a) The amount of any Account outside of the Eligibility Period. (b) Any
Account which is a Contra Account.
(c) Any Account subject to the Cross Aging Rule.
(d) Any Account which has been bonded or become subject to a suretyship or
other similar arrangement. (e) With the exception of BlueCross/Blue Shield
and its family of companies, any Inter-Company Account. (f) Any Foreign
Account, including any Export-Related Account, unless such Account shall be
insured by Credit Insurance, or such Account shall be supported by a letter
of credit for the benefit of and acceptable to Bank, or such Account shall
be eligible pursuant to a duly executed Loan Authorization Agreement issued
by the Small Business Administration of the United States Government in
favor of Bank, or such Account is eligible pursuant to a duly executed
Borrowers Agreement issued by the Export-Import Bank of the United States
in favor of Bank, or such Account is otherwise expressly approved in
writing by the Bank. (g) Any Account representing a Xxxx and Hold or
similar arrangement.
(h) Any Government Account due from any branch, agency, or political
subdivision of the State or Federal Government, including without
limitation, any municipality, county, or board for which the proper
Assignment of Claims form, governmental consents, approvals, or Notice of
Assignment form have not been fully executed or warrant issued for payment
thereof by the state if such assignments, consents, approvals or warrants
for payment shall be required by Bank in writing.
(i) Any Account due from any government agency which, by contract,
precludes and/or prohibits the collateral assignment of such Account,
unless otherwise expressly approved by Bank in writing. (j) Any Account
which, at the discretion of Bank, is deemed doubtful for collection for any
reason, including but not limited to, those involving disputes, returns,
credit worthiness, legal proceedings, whether in process, pending or
threatened, conditional payments, is not free of all liens, encumbrances,
charges, rights and interest except those in favor of Bank; or represent
deposits, retainages, or progress billings, or are not payable in U.S.
Dollars.
(k) [Intentionally Deleted.]
(l) That portion of Accounts which represent a credit balance on any
Account outside of the Eligibility Period. (m) Any Chattel Paper unless
expressly made an Eligible Account in writing by Bank. (n) Any Account
otherwise deemed ineligible by Bank in its sole discretion.
(o) Any Consumer or Patient-Pay Account.
(p) All Accounts from companies with greater than fifty (50%) percent of
Accounts that are ineligible, Medicare and Medicaid receivables and retail,
non-insurance company Accoutns.
Bank reserves the right, upon notice, in its sole discretion, to amend the
terms of the Ineligible Accounts at any time.
DD.04. Ineligible Inventory. Ineligible Inventory shall include the following:
(a) Inventory not legally owned by Borrowers, including but not be limited
to, goods on consignment from any supplier, vendor, and/or individual,
or goods on demonstration and/or for trial, and not subject to the
first lien priority security interest in favor of Bank.
(b) Inventory not in new and/or salable condition, including but not
limited to, damaged goods, goods used by Borrowers and/or potential buyers,
goods with missing components/parts and not in a whole condition.
(c) Inventory which has been held by Borrowers more than n/a months without
being sold and/or leased. (d) Inventory representing work-in-process unless
authorized by Bank pursuant to DD.02(c) and/or (d). (e) Inventory deemed by
Bank, at its sole discretion, to cause and/or represent unusual danger to
the health
and/or safety of individual(s) and/or the environment.
(f) Inventory which violates any federal law and/or laws of the city,
county, or state where the goods are stored.
(g) Inventory of which Borrowers are the legal owner but which is being
stored and/or housed at a location other than the place of business of
Borrowers or in transit (unless otherwise approved by Bank in writing
including conditions thereof) or is otherwise authorized as set forth
hereinabove in Section DD.02(c) and/or (d).
(h) Inventory deemed otherwise ineligible by Bank in its sole discretion.
(i) Inventory subject to a security interest, lien or other encumbrance in favor
of any other Person. (j) Inventory, if Export-Related Inventory, unless such
Inventory is eligible pursuant to a duly executed
Loan Authorization Agreement issued by the Small Business
Administration of the United States Government in favor of Bank, or
such Inventory is eligible pursuant to a duly executed Borrowers
Agreement issued by the Export-Import Bank of the United States in
favor of Bank, or such Inventory is otherwise expressly approved in
writing by Bank.
(k) Inventory determined by Bank to be Excess Inventory.
(l) Inventory subject to a License Agreement for which Bank shall have
required in writing a Licensor/Bank Agreement and such agreement shall
not have been obtained.
Bank reserves the right, upon notice, in its sole discretion, to amend the
terms of the Ineligible Inventory at any time.
DD.05. Proceeds of Collateral and Application of Proceeds. (Check
either (b) or (c); and (a) if applicable.) (a) Borrowers shall
execute a Lockbox Agreement with Bank and shall notify, or
cause to be notified, all Account Debtors to forward all
remittances to the lockbox in accordance with such Lockbox
Agreement. Customer shall pay all costs of such lockbox,
including set up and administration thereof.
(b) Borrowers agree to deposit all Proceeds of the Collateral
in a Collateral Reserve Account at Bank, except that Medicare
Receivables proceeds shall be deposited to the Medicare
Receivables Account.
(c) Borrowers agree to deposit all Proceeds of the Collateral
in an Operating Account. Borrowers agree that all Proceeds shall be
applied as described in the Loan Documents (including the Asset-Based
Sweep Services Attachment or the ABL Credit Line Sweep Services
Agreement, if applicable). Bank reserves the right, in its sole
discretion, to require Borrowers to implement DD.05 (b) and/or DD.05
(a) immediately upon written notification from Bank.
DD.06. Reporting / Exam.
(a) Reporting. (Check all that apply)
Borrowers shall provide the following reports, financial statements,
list of Account Debtors and addresses and other reports to Bank upon
execution hereof and thereafter as indicated below (herein the
"Required Information"). Unless and until the Bank shall agree
otherwise, such Required Information shall be submitted to Bank
electronically in non-scanned PDF format acceptable to Bank via the
internet as an electronic record thereof or in such other format
acceptable to Bank.
Weekly Quarterly Annually Month-End
Monthly Loan Base Reports.
Monthly Loan Base Reports,
prepared as of the end of
each reporting period.
Except as set forth below,
Loan Base Reports are
required for all loans
covered by this Agreement
no later than 15 days
following each reporting
period end. Additionally,
all other required reports
indicated below will also
be due on the fifteenth
(15th) day of each
reporting period. Weekly
Loan Base Reports. Weekly
Loan Base Reports, based on
information with an "as of"
date no more than three (3)
business days old when
received by Bank. Sales and
cash receipts journals
shall accompany each
report. The last Weekly
Loan Base Report provided
each month shall be a full
or partial week with an "as
of" date consistent with
Borrowers' fiscal month
end, subject to reconciling
adjustments, if any, in the
monthly reports hereinafter
required.
Accounts Aging based upon
invoice date by the
fifteenth (15th) day of
each reporting period.
Inventory Report by the
fifteenth (15th) day of
each
reporting period.
Accounts Payable Aging by the fifteenth (15th) day of each reporting
period.
Monthly Balance Sheets, which shall be due on the 15th day ---- of each
month.
To the extent permitted by applicable Federal or State law or HIPAA, a list
of Account Debtors with current addresses. Other: n/a ---
Borrowers shall forward to Bank any of these reports at such other
times as Bank may require them, upon notice to Borrowers, and/or any
other reports deemed necessary by Bank in its discretion to monitor the
Collateral for the Line of Credit. Notwithstanding any provision to the
contrary, if any, in the Loan Agreement, the foregoing reporting
requirements shall not be subject to notice of default by Bank, or
right to cure by Borrowers, it being expressly understood and agreed
that timely receipt of same are material and fundamental to the Bank's
administration and funding of the Line of Credit. Upon written notice,
Bank shall be authorized to impose a late reporting fee as determined
by Bank for failure of Borrowers to timely comply with the reporting
requirements of this section.
(b) Exam. From time to time, as deemed necessary by Bank in its sole
discretion to monitor Collateral, ----- Borrowers hereby authorize Bank or any
agent or representative thereof to inspect, examine and verify the Accounts,
Inventory, and Other Collateral, make copies of and make abstracts from all the
records and books of account of, and visit the properties of, Borrowers, and to
discuss the affairs, finances, and Collateral generally of Borrowers with any of
its respective owners, officers, directors, shareholders, members, or partners
and Borrowers' independent accountants and consultants. Without expense to Bank,
Bank may use any of Borrowers' personnel, equipment, including computer
equipment, programs and computer readable media as deemed necessary by Bank to
conduct such Exam.
DD.07. Fees.
(a) Borrowers shall pay to Bank the sum of $200.00 per month as a fee
for the use of Bank's asset based lending services which shall be
in addition to any fees or other charges for the treasury services
of Bank. This fee may be changed by written notice to Borrowers.
(b) Borrowers shall pay to Bank for each Exam of Borrowers, an
examination fee of $750.00 per diem per examiner plus expenses
such as, but not limited to, travel expense(s), specialized
equipment needed to count and/or value goods pledged as Collateral
to Bank, the use of outside firms to perform any Exam as deemed
necessary by Bank in its sole discretion to monitor Collateral,
with said reimbursement being represented by receipts and/or
listing of expense(s) submitted to Borrowers by Bank along with
Bank's invoice for reimbursement. Bank reserves the right to
change the examination fee upon notice to Borrowers.
(c) Borrowers shall pay to Bank the actual cost of any appraisal of
Inventory and/or Other Collateral performed by an independent
appraiser as required by Bank.
(d) Bank in its discretion may charge a late reporting fee for
Borrowers' failure to provide timely reports required under
Section DD.06.
(e) Bank reserves the right to debit all Fees from the Operating
Account of Borrowers.
DD.08. Events of Default. In addition to those Events of Default
appearing elsewhere in the Loan Agreement, each of the following
shall constitute an additional Event of Default under the Loan
Agreement:
(a) The refusal by Borrowers to permit Bank to inspect, examine or
verify the books and records in accordance with the Exam
provisions of this Loan Agreement.
(b) Failure to execute a Lockbox Agreement and notify Account Debtors
to remit payments to the Lockbox, if required by Bank.
(c) Failure to deposit checks or other remittances received in payment
of Accounts into the Collateral Reserve Account or Operating
Account, as required pursuant to Section DD.05.
(d) If the outstanding principal balance under the Line of Credit plus
the Reserves exceeds the Collateral Loan Value or the amount of
the Line of Credit and Borrowers fail immediately to prepay the
Line of Credit by an amount sufficient to bring Borrowers in
compliance with this Schedule DD.
(e) If Borrowers fail to comply with the Reporting requirements of
DD.06(a).
(f) If Borrowers fail to otherwise comply with any of the provisions
of this Schedule "DD" or the Loan Agreement.
DD.09. Other Provisions.
(a) Notice. Any notice required to be given herein shall be effective
when made and, notwithstanding any provisions in the Loan
Agreement to the contrary, may be made by hand delivery, confirmed
facsimile transmission, overnight courier, first class or
certified mail return receipt requested.
(b) Operating Account. Notwithstanding any provision in the Loan
Agreement to the contrary, Borrowers shall establish and maintain
its Operating Account and Medicare Receivables Account with Bank
during the term hereof.
(c) Certain Events. Upon execution hereof and with each borrowing made
hereunder pursuant to the Loan Base Report, Borrowers shall be
deemed to certify to Bank that (i) no Event of Default shall have
occurred and be continuing, and no event shall have occurred and
be continuing that, with the giving of notice or passage of time
or both, would be an Event of Default; (ii) no material adverse
change shall have occurred in the financial or operating condition
or prospects of Borrowers since the date of the Loan Agreement;
(iii) all Loan Documents shall have remained in full force and
effect; and (iv) the representations and warranties contained in
the Loan Agreement shall be true and correct as of such date.
(d) Electronic Transactions. Borrowers and Bank agree that the
electronic reporting of Required Information authorized herein
shall constitute an agreement under the Uniform Electronic
Transfer Act (the "Act"), in effect in the State of North
Carolina; and any dispute or controversy relating to such
reporting shall be interpreted in accordance with the provisions
of the Act. With respect to such reporting, Borrowers acknowledge
that Bank shall not be responsible (i) for any failure,
interruption, or delay in the performance of the internet; (ii)
for any unauthorized, inadvertent, or fraudulent access, use or
disclosure to third parties of the Required Information should it
occur by error of transmission of Customer or reply thereto by
Bank or otherwise; (iii) for Bank's failure to maintain security
measures at the time of transmission or reply thereto to prevent
unauthorized access, misappropriation and use of Required
Information by third parties. Borrowers expressly assume the risk
of unauthorized access, use or misappropriation by third parties
of the Required Information transmitted to Bank via the internet
and will hold harmless and indemnify Bank from any claim or
expense, including reasonable attorneys fees associated therewith.
Until Bank shall receive written notice otherwise from Borrowers,
the following persons may be contacted by Bank with any questions
or issues about the Required Information:
Primary Contact Person Secondary Contact Person
----------------------------------------------------------- -----------------------------------------------------
----------------------------------------------------------- -----------------------------------------------------
Name: Xxxxxx X. Xxxxx Name Xxxxxxxxxx Xxxx
----------------------------------------------------------- -----------------------------------------------------
----------------------------------------------------------- -----------------------------------------------------
Title: Executive Vice President and Chief Executive Title Vice President of Human Relations
Officer
----------------------------------------------------------- -----------------------------------------------------
----------------------------------------------------------- -----------------------------------------------------
Telephone Number: 000.000.0000 Telephone Number 000.000.0000
----------------------------------------------------------- -----------------------------------------------------
----------------------------------------------------------- ----------------------------------------------------
E-mail Address: xxxxxx.xxxxx@xxxxxxxxxxx.xxx E-mail Address xxxxxx.xxxxxxxxxx@xxxxxxxxxxx.xxx
This Agreement is made and entered into for the sole protection and benefit of
Bank and Borrowers, their successors and assigns, and no third person or persons
shall have any right(s) to action hereon.
[SIGNATURE PAGES TO FOLLOW]
IN WITNESS WHEREOF, Borrowers and Bank have executed this Schedule "DD" as of
this date and have adopted as their respective seal the "seal" appearing beside
or near their signatures below.
Each Borrower is a Corporation:
WITNESS: UCI MEDICAL AFFILIATES, INC.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ------------------------------------------------------------
----------
Title: Chief Executive Officer
------------------------------------------------------------
WITNESS: UCI MEDICAL AFFILIATES OF SOUTH CAROLINA, INC.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ------------------------------------------------------------
----------
Title: Chief Executive Officer
------------------------------------------------------------
WITNESS: DOCTORS CARE, P.A.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ------------------------------------------------------------
----------
Title:
------------------------------------------------------------
WITNESS: DOCTOR'S CARE OF TENNESSEE, P.C.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ------------------------------------------------------------
----------
Title: President
------------------------------------------------------------
WITNESS: PROGRESSIVE PHYSICAL THERAPY, P.A.
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ------------------------------------------------------------
----------
Title: President
------------------------------------------------------------
WITNESS: CAROLINA ORTHOPEDIC & SPORTS MEDICINE, P.A
-----------------------------------------------------------------
Name of Corporation
/s Xxxxxx Xxxxxx III By: /s D. Xxxxxxx Xxxxx
---------- ------------------------------------------------- ------------------------------------------------------------
----------
Title: President
------------------------------------------------------------
Bank:
WITNESS: BRANCH BANKING AND TRUST COMPANY
/s Xxxxx X. Xxxxxx By: /s X. X. Xxxxxxxxx, Xx.
--------------- -------------------------------------------- ------------------------------------------------------------
X. X.
Xxxxxxxxx, Xx.
Title: Senior
Vice President
------------------------------------------------------------
(1) Note: Borrower's options under the Maximum Debt to Tangible Net Worth
Covenant were to choose (i) a ratio of total liabilities to tangible
net worth of not greater than 2.50 to 1.00; or (ii) a ratio of total
liabilities to tangible net worth of not greater than 3.00 to 1.00 with
the interest rate of the real estate loan between BB&T and UCI
Properties, LLC being modified to have a floor rate of 400 basis
points.
