AMENDMENT No.4 AND JOINDER AGREEMENT
THIS AMENDMENT No.4 AND JOINDER AGREEMENT ("Amendment") is entered into
as of April ___ 1998 by and among ACCUHEALTH, INC. a corporation organized under
the laws of the State of New York ("Accuhealth"), MIDVIEW DRUG, INC. a
corporation organized under the laws of the State of New York ("Midview"),
ACCUHEALTH HOME CARE, INC. a corporation organized under the laws of the State
of Delaware ("AFIC"), CITIVIEW DRUG CO., INC. a corporation organized under the
laws of the State of New York ("Citiview"), PROHEALTHCARE INFUSION SERVICES,
INC., a corporation organized under the laws of the State of New Jersey
("PHCIS"), HEALIX HEALTHCARE, INC. a corporation organized under the laws of the
State of Delaware ("Hill"), PRN HOMECARE AGENCY, INC. a corporation organized
under the laws of the State of New Jersey ("PRN"), AMERIX NURSING HOLDINGS, INC.
a corporation organized under the laws of the State of Delaware ("Amerix"),
HEALIX HEALTHCARE, INC. a corporation organized under the laws of the State of
New York ("Healthcare"), HEALIX HEALTHCARE OF NEW YORK, INC. a corporation
organized under the laws of the state of New York ("Healix NY"), RYE BEACH
HEALTHCARE, INC. a corporation organized under the laws of the State of New York
("Rye Beach"), HEALIX HEALTHCARE OF NEW JERSEY a corporation organized under the
laws of the State of New Jersey ("Healix NY') and AMERICARE HOME NURSING
SERVICES, INC. a corporation organized under the laws of the State of New Jersey
("Americare"), (Accuhealth, Midview, AHC, Citiview, PHCIS, Hill, PRN, Amerix,
Healthcare, Healix NY, Rye Beach, Healix NJ and Americare, each a "Borrower"
and, jointly and severally, the "Borrowers"), and XXXXXXXXX & XXXXXXXXX, INC.
("Lender").
BACKGROUND
Borrowers (other than HHI, PRN, Amerix, Healthcare, Healix NY, Rye
Beach, Healix NJ and Americare) and Lender are parties to a Loan and Security
Agreement dated as of April 28, 1994, as amended by Amendment No.1 dated as of
February 1, 1996, Amendment No.2 dated as of February 1, 1997 and Amendment No.3
and Joinder Agreement dated as of July 30, 1997 (as further amended,
supplemented or otherwise modified from time to time, the "Loan Agreement")
pursuant to which Lender provided Borrowers (other than Hill, PRN, Amerix,
Healthcare, Healix NY, Rye Beach, Healix NJ and Americare) with certain
financial accommodations.
Pursuant to an Agreement and Plan of Merger dated as of December 1997,
by and among Accuhealth, HHI Acquiring Corp., a wholly-owned subsidiary of
Accuhealth ("Sub"), HHI, Xxxxx Xxxxxx, Xxxxx Xxxxxxxx, M.D., Xxxx Xxxxxxxxx,
Xxxxxxx X. Xxxxx, M.D., Xxxxxx XxxXxxxxx, Xxxxxx XxxXxxxxx, Xxxxxx Xxxxx,
Xxxxxxxx X. O'Xxxxx XxXxxxxx and Xxxxxx Xxxxxxxx, Xx. (the "Purchase Agreement")
(i) Accuhealth acquired all of the issued and outstanding shares of capital
stock of Hill and (ii) Sub was merged with and into HHI with Hill as the
surviving corporation.
Borrowers (other than HHI, PRN, Amerix, Healthcare, Healix NY, Rye
Beach, Healix NJ and Americare) have requested that Lender permit each of HHI,
PRN, Amerix, Healthcare, Healix NY, Rye Beach, Healix NJ and Americare to become
a Borrower under the Loan Agreement and
amend certain provisions of the Loan Agreement and Lender is willing to do so on
the terms and conditions hereafter set forth.
NOW, THEREFORE, in consideration of any loan or advance or grant of
credit heretofore or hereafter made to or for the account of Borrowers by
Lender, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows;
1. DEFINITIONS. All capitalized terms not otherwise defined herein
shall have the meanings given to them in the Loan Agreement.
2. JOINDER.
(a) PHCIS, HILL, PRN, Amerix, Healthcare, Healix NY, Rye Beach,
Healix NJ and Americare are hereby added as additional Borrowers under the Loan
Agreement, and all references to "Borrower" or "Borrowers" thereunder shall
henceforth be deemed to include PHCIS, Hill, PRN, Amerix, Healthcare, Healix NY,
Rye Beach, Healix NJ and Americare.
(b) PHCIS, HILL, PRN, Amerix, Healthcare, Healix NY, Rye Beach,
Healix NJ and Americare hereby adopt the Loan Agreement and each of the
Ancillary Agreements and assumes in lull, and acknowledges that it is jointly
and severally liable for, the payment, discharge, satisfaction and performance
of all Obligations. Without limiting the generality of the foregoing, in order
to secure the prompt payment and performance to Lender of the Obligations, Hill,
PRN, Amerix, Healthcare, Healix NY, Rye Beach, Healix NJ and Americare each
hereby assigns, pledges and grants to Lender a continuing security interest in
and to all of its respective Collateral, whether now owned or existing or
hereafter acquired or arising and wheresoever located.
3. AMENDMENT TO LOAN AGREEMENT. Subject to satisfaction of the
conditions precedent set forth in Section 4 below, the Loan Agreement is hereby
amended as follows;
3.1 Section 1(a) of the Loan Agreement is hereby amended by adding
the following defined terms in their appropriate alphabetical order;
"AMERICARE" shall mean Americare Home Nursing Services, Inc. a
New I, Jersey corporation.
"AMERIX" shall mean AMERIX NURSING HOLDINGS, INC. a Delaware
corporation.
"FOURTH AMENDMENT" shall mean Amendment No.4 and Joinder
Agreement to Loan and Security Agreement dated as of April 28,
1994.
"FOURTH AMENDMENT EFFECTIVE DATE" shall mean ___________, 1998.
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"HEALIX NJ" shall mean Healix Healthcare of New Jersey a New
Jersey corporation.
"HEALIX NY" shall mean Healix Healthcare of New York, Inc. a
New York corporation.
"HEALTHCARE" shall mean Healix Healthcare, Inc. a New York
corporation.
"HILL" shall mean Healix Healthcare, Inc. a Delaware
corporation.
"OVERADVANCE AVAILABILITY" shall mean an amount equal to
$1,000,000 in excess of the Formula Amount.
"OVERDRAFT LOANS" shall mean the amount outstanding under the
Overadvance Availability.
"OVERADVANCE RATE" shall mean an interest rate per annum equal
to the (i) Prime Rate plus (ii) three percent (3%)."
"PHCIS" shall mean ProHealthCare Infusion Services, Inc., a New
Jersey corporation.
"PRN" shall mean PRN Homecare Agency, Inc. a New Jersey
corporation.
"RYE BEACH" shall mean Rye Beach Healthcare, Inc. a New York
corporation.
"THIRD AMENDMENT" shall mean amendment No.3 and Joinder
Agreement to Loan and Security Agreement dated as of April 28,
1994.
3.2 Section 1(a) of the Loan Agreement is further amended as
follows;
(a) The defined term "CONTRACT RATE" is amended by adding the
following at the end thereof:
"and the Overdraft Rate."
(b) The defined term "LOANS" is amended by inserting the words
"Overdraft Loans" immediately after the words "Term Loan" on the first line
thereof.
(c) The defined term "TERM" is amended by deleting the date
"April 1, 1998" on the first line thereof and inserting the date "April 1, 2000"
in its place and stead.
(d) The defined term "REVOLVING INTEREST RATE" is amended in
its
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entirety to read as follows:
"Revolving Interest Rate" means an interest rate per annum
equal to (i) the Prime Rate plus (ii) one and one half percent
(1 1/2%)."
(e) The defined term "MAXIMUM REVOLVING AMOUNT" is amended by
deleting the sum "$3,500,000" and substituting the sum "$9,000,000" in its place
and stead.
(f) The defined term "MINIMUM AVERAGE MONTHLY LOAN AMOUNT" is
amended by deleting the sum "$1,750,000" and substituting the sum "$4,500,000 in
its place and stead.
(g) The defined term "RECEIVABLES AVAILABILITY" is amended by
deleting the words "seventy percent (70%)" in the last line thereof and
substituting the words "seventy-five percent (75%)" in their place and stead.
(h) The defined term "ELIGIBLE INVENTORY" is deleted.
(i) The defined term "ELIGIBLE RECEIVABLES" is amended by:
(i) adding the following at the end of subparagraph (a)
thereof:
"provided, however, that Receivables having a face value
aggregating no more than $400,000, at any one time
outstanding, may be "xxxx and hold Receivables" upon the
express condition that (i) each account debtor with respect
to a xxxx and hold Receivable provides Lender with
documentation satisfactory to Lender regarding such xxxx
and hold status; and (ii) xxxx and hold invoicing shall be
aged based only upon the original invoice date thereof"
(ii) deleting the word "and" immediately preceding
subparagraph "(t)" in the next to last line thereof and
substituting"," in its place and stead; and
(iii) deleting the period at the end thereof and adding the
following in its place and stead:
"and (u) such Receivable is less than 150 days past invoice
date."
(i) The defined term "EVENT OF DEFAULT" is amended by
deleting the words "Section 13" and substituting the words "Section 18" in their
place and stead.
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(k) The defined term "Inventory Availability" is deleted.
(l) The defined term "Term Loan Rate" is amended in its
entirety to read as follows:
"Term Loan Rate" means an interest rate per annum equal
to (i) the Prime Rate plus (ii) four percent (4%)."
3.3 Section 2(a)(ii) of the Loan Agreement is amended in its
entirety to read as follows:
"Overadvance Availability, minus".
3.4 Section 2(c) of the Loan Agreement is amended by deleting
the word "which" in the fourth line thereof
3.5 Section 2(h) of the Loan Agreement is amended by adding
the following at the end thereof
"Notwithstanding the foregoing, subject to the terms
and conditions set forth herein and in the Ancillary
Agreements, Lender will increase the Term Loan from
$500,000 to $750,000 and upon the advance of such
additional sums ("Additional Sums") the definition of
Term Loan shall be such $750,000 Loan. The Additional
Sums shall be advanced on the Fourth Amendment
Effective Date and the resultant $750,000 Term Loan
shall be payable as set forth in the Amended and
Restated Term Note, in substantially the form attached
to the Fourth Amendment as Exhibit 2(h), which upon its
execution and delivery will be for all purposes the
"Term Note", subject to acceleration upon the
occurrence of an Event of Default or termination of
this Agreement and shall otherwise be evidenced by and
subject to the terms and conditions set forth in the
Term Note."
3.6 Section 3 of the Loan Agreement is amended by adding the
words "plus the Overadvance Line" immediately after the words "Formula Amount"
in the fourth line thereof
3.7 Section 5(b)(ii) of the Loan Agreement is amended in its
entirety to read as follows:
"Borrowers shall pay to Lender a facility fee in an
amount equal to $53,750 per contract year, earned on
the first day of each contract year, and payable in
equal quarterly installments of $13,437.50 each
commencing on April __, 1998 and on the same day on
each July, October, January and April thereafter until
this Agreement is irrevocably terminated and all
Obligations shall have been indefeasibly paid in full
to us".
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3.8 Section 5(a)(v) of the Loan Agreement is amended by
deleting the words "1-1/2\" and substituting the words "one and one half percent
(1 1/2%)" in their place and stead.
3.9 Section 12(m)(ii) of the Loan Agreement is deleted and the
following is substituted in its place and stead:
"(ii) declare, pay or make any dividend or distribution
on any shares of the common stock or preferred stock of
such Borrower (other than dividends or distributions
payable in its stock or warrants or split-ups or
reclassifications of its stock) or apply any of its
funds, property or assets to the purchase, redemption
or other retirement of any common or preferred stock of
such Borrower except that so long as no Incipient Event
of Default or Event of Default shall have occurred or
would occur as a result of such payment Accuhealth may
pay cash dividends on its preferred stock,"
3.10 Section 12 of the Loan Agreement is amended by adding a
new Subsection 12(p) to read as follows:
"(p) it will not change its certified public
accountants without the prior written consent of Lender
which consent shall not be unreasonably withheld."
3.11 Section 17 of the Loan Agreement is amended by:
(i) deleting the word "second" from the
eleventh line thereof; and
(ii) deleting the last paragraph thereof and
substituting the following in its place and
stead:
"Notwithstanding the foregoing, in the
event that (x) Lender (I) shall terminate
this Agreement at any time following the
occurrence and during the continuance of an
Event of Default or (II) shall assign all
of the Obligations to a transferee pursuant
to the provisions of Section 15 hereof and
Borrower terminates this Agreement, or (y)
Borrower funds the repayment of all of the
Obligations solely from (I) the proceeds of
an equity financing of Borrower or (ii) a
refinancing of the Borrower in connection
with the acquisition by Borrower of The
Care Group (the "Care Acquisition")
provided, however, that Lender shall be
granted a right of first refusal with
respect to the financing of the Care
Acquisition".
3.12 The terms Eligible Inventory and Inventory Availability
are deleted from
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the Loan Agreement.
4. CONDITIONS OF EFFECTIVENESS. This Amendment shall become effective
as of ___________________ 1998, when and only when Lender shall have received
(i) four copies of this Amendment executed by Borrower and consented and agreed
to by Xxxxx X. Xxxxx, and Xxxxxxx Xxxxxxxxx, as guarantors, (ii) a certified
resolution of each Borrower authorizing the acceptance of the terms and
provisions of the increased Term Loan and the increase of the facility, (iii)
the Am ended and Restated Term Note executed by each Borrower with respect to
the increase in the Term Loan described in Section 3.5 of this Amendment, (iv)
Guaranty Agreements executed by each of Xxxxx X. Xxxxx, and Xxxxxxx Xxxxxxxxx,
(v) a warrant, in substantially the form attached to this Amendment as Exhibit
4, issued by Accuhealth to Lender for the purchase by Lender of 50,000 shares of
common stock of Accuhealth; and (vi) such other certificates, instruments,
documents, agreements and opinions of counsel as may be required by Lender or
its counsel, each of which shall be in form and substance satisfactory to Lender
and its counsel.
5. REPRESENTATIONS AND WARRANTIES. Borrowers hereby represent and
warrant as follows:
(a) This Amendment and the Loan Agreement, as amended hereby,
constitute legal, valid and binding obligations of Borrowers and are enforceable
against Borrowers in accordance with their respective terms.
(b) Upon the effectiveness of this Amendment, Borrowers hereby
reaffirm all covenants, representations and warranties made in the Loan
Agreement to the extent the same are not amended hereby and agree that all such
covenants, representations and warranties shall be deemed to have been remade as
of the effective date of this Amendment.
(c) No Event of Default or Incipient Event of Default has occurred
and is continuing or would exist after giving effect to this Amendment.
(d) Borrowers have no defense, counterclaim or offset with respect
to the Loan Agreement.
6. EFFECT ON THE LOAN AGREEMENT.
(a) Upon the effectiveness of this Amendment, each reference in the
Loan Agreement to "this Agreement", "hereunder", "hereof', "herein" or words of
like import shall mean and be a reference to the Loan Agreement as amended
hereby.
(b) Except as specifically amended herein, the Loan Agreement, and
all other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in lull force and effect, and are hereby
ratified and confirmed.
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(c) The execution, delivery and effectiveness of this Amendment
shall not operate as a waiver of any right, power or remedy of Lender, nor
constitute a waiver of any provision of the Loan Agreement, or any other
documents, instruments or agreements executed and/or delivered under or in
connection therewith.
7. GOVERNING LAW. This Amendment shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns and
shall be governed by and construed in accordance with the laws of the State of
New York.
8. HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
9. COUNTERPARTS. This Amendment may be executed by the parties hereto
in one or more counterparts, each of which shall be deemed an original and all
of which taken together shall be deemed to constitute one and the same
agreement.
IN WITNESS WHEREOF, this Amendment has been duly executed as of the day
and year first written above.
ACCUHEALTH, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
ACCUHEALTH HOME CARE, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
PROHEALTHCARE INFUSION SERVICES
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
PRN HOMECARE AGENCY, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
MIDVIEW DRUG, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
CITIVIEW DRUG CO., INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
HEALIX HEALTHCARE, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
AMERIX NURSING HOLDINGS, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
(SIGNATURES CONTINUED ON PAGE 9)
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HEALIX HEALTHCARE, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
RYE BEACH HEALTHCARE, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
AMERICARE HOME NURSING SERVICES, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
HEALIX HEALTHCARE OF NEW YORK, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
HEALIX HEALTHCARE OF NEW JERSEY, INC.
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
Name:
Title:
CONSENTED AND AGREED TO:
By: /s/ XXXXX X. XXXXX
-----------------------------
Xxxxx X. Xxxxx
------------------------------
Xxxxxxx Xxxxxxxxx
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EXHIBIT 2(h)
TO AMENDMENT NO. 4 AND JOINDER AGREEMENT
AMENDED AND RESTATED TERM NOTE
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EXHIBIT 4
TO AMENDMENT NO. 4 AND JOINDER AGREEMENT
WARRANT
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