EXHIBIT 10.1
FIRST AMENDMENT TO REPLACEMENT REDUCED AND MODIFIED
RENEWAL REVOLVING PROMISSORY NOTE
THIS FIRST AMENDMENT TO REPLACEMENT REDUCED AND MODIFIED RENEWAL REVOLVING
PROMISSORY NOTE is made and entered into by and among AMSOUTH BANK (the "Bank")
and DIVERSICARE MANAGEMENT SERVICES, CO., a Tennessee corporation (the
"Borrower").
W I T N E S S E T H :
WHEREAS, Borrower executed to Bank that certain Replacement Reduced and
Modified Renewal Revolving Promissory Note dated October 29, 2004, in the
original principal amount of TWO MILLION FIVE HUNDRED THOUSAND AND NO/100
($2,500,000.00) DOLLARS (the "Note"); and
WHEREAS, Bank has agreed to further modify the Note in accordance with the
terms and conditions set forth herein and as set forth in the Sixth Amendment to
Master Amendment to Loan Documents and Agreement executed of even date herewith
by Bank and Debtors as defined therein, and Borrower has agreed to lower the
maximum sum which may be advanced hereafter by Bank from $2,500,000.00 to
$2,300,000.00.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and in accordance with the terms
and conditions of that Sixth Amendment to Master Amendment and Loan Documents
executed by Bank, and Debtors, as defined therein, to be effective as of January
29, 2005, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. That as of the effective date hereof, the Note has a principal
balance of $0.00.
2. The first and second full paragraphs of the Note are hereby deleted
entirely, and the following language is substituted instead:
FOR VALUE RECEIVED, the undersigned, DIVERSICARE MANAGEMENT SERVICES
CO., a Tennessee corporation (the "Borrower"), promises to pay to the
order of AMSOUTH BANK (the "Bank"), in lawful currency of the United
States of America, at AmSouth Center, 000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxx 00000, or at such other place as the holder from time to time
may designate in writing, the principal sum of TWO MILLION THREE HUNDRED
THOUSAND AND N0/100 ($2,300,000.00) DOLLARS, or so much thereof as may be
advanced hereunder in accordance with the terms of a Master Amendment to
Loan Documents and Agreement dated effective October 1, 2000 executed
between Bank, Borrower, and other subsidiaries, or affiliates of Borrower,
all of which, including Borrower, are defined as "Debtors" therein, as
amended (the "Master Amendment"). Interest shall accrue on the principal
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balance outstanding from and after April 29, 2005 at the Bank's Prime Rate
plus one half of one percent (0.50%) per annum, provided that the interest
rate shall not, during the term hereof, exceed nine and one-half percent
(9.5%) per annum so long as there is no default hereunder, after which
time interest shall accrue at the default rate as set forth below (the
"Default Rate"). Interest shall be due and payable monthly commencing on
the first (1st) day of each month commencing on May 29, 2005. All
principal and unpaid interest shall be payable at maturity on the 29th day
of January 2006 (the "Maturity Date"). The "Prime Rate" of Bank is the
"Prime Rate" in effect from time to time, as designated by Bank, such rate
being one of the base rates Bank establishes from time to time for lending
purposes and not necessarily being the lowest rate offered by Bank. In the
event the Prime Rate should become unavailable for any reason, then the
interest rate hereunder shall be based upon a reasonably comparable index
for determining variable interest rates chosen by Bank in good faith.
The whole of the principal sum and, to the extent permitted by law,
any accrued interest, shall bear, after default or maturity, interest at
the lesser of (i) the highest lawful rate then in effect pursuant to
applicable law, or (ii) the rate that is four percentage points (4%) in
excess of Lender's Prime Rate, as it varies from time to time.
3. The Note is amended as stated herein, but no further or otherwise, and
the terms and provisions of the Note, as hereby amended, shall be and continue
to be in full force and effect. Nothing herein is intended to operate to release
or diminish any right of Bank under the Note or with respect to any collateral
securing the Note or with respect to any guaranty or suretyship agreement for
the Note, all of which shall remain in full force and effect. This instrument
constitutes the entire agreement of the parties with respect to the subject
matter hereof.
IN WITNESS WHEREOF, this instrument has been executed to be effective on
the 29th day of January, 2005.
BORROWER:
DIVERSICARE MANAGEMENT SERVICES CO.,
a Tennessee corporation
By: /s/ Xxxxxxx X. Council
-------------------------
Xxxxxxx X. Council, President
BANK:
AMSOUTH BANK
By: /s/ Xxxxx Xxx
---------------------------
Xxxxx Xxx, Vice President
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