EXHIBIT 10.1
AMENDMENT TO LOAN AGREEMENT
This Amendment to Loan Agreement is made on September 27, 2006 ("Effective
Date") between FAMILY HOME HEALTH SERVICES INC., a Nevada corporation
("Borrower"), of 000 X. Xxx Xxxxx Xxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx
00000-0000 and COMERICA BANK, a Michigan banking corporation ("Bank"), whose
address is 000 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000.
PRELIMINARY STATEMENT: Borrower and Bank entered into an Amended and Restated
Loan Agreement dated April 5, 2006 ("Loan Agreement") providing terms and
conditions governing certain loans and other credit accommodations extended by
Bank to Borrower ("Indebtedness"). Borrower and Bank have agreed to amend the
terms of the Loan Agreement as provided in this Amendment. Borrower has
requested that Bank make additional loans or other credit available under the
Loan Agreement.
AGREEMENT: Accordingly, Borrower and Bank agree as follows:
1. Capitalized Terms. In this Amendment, capitalized terms that are used without
separate definition shall have the meanings given to them in the Loan Agreement.
2. Amendments. The Loan Agreement is amended as follows:
2.1 The following term, defined in the Loan Agreement, is given the
following amended definition:
"Line of Credit Amount" means, as of any applicable date of
determination, One Million Eight Hundred Thousand Dollars ($1,800,000).
2.2 Section 6.16 is added to the Agreement and shall read as follows:
"6.16 Mandatory Prepayment. Upon the earlier of (a) the
receipt of additional equity from Xxxxxx or (b) December 31, 2006,
Borrower shall prepay the Term Loan so that the outstanding principal
balance of the Term Loan is less than $1,500,000."
3. Representations. Borrower represents and agrees that:
3.1 Except as expressly modified in this Amendment, the
representations, warranties, and covenants set forth in the Loan Agreement and
in each related document, agreement, and instrument remain true and correct,
continue to be satisfied in all respects, and are legal, valid and binding
obligations with the same force and effect as if entirely restated in this
Amendment.
3.2 When executed, this Amendment will be a duly authorized, legal,
valid, and binding obligation of Borrower enforceable in accordance with its
terms.
3.3 There is no default continuing under the Loan Agreement, or any
related document, agreement, or instrument, and no event has occurred or
condition exists that is or, with the giving of notice or lapse of time or both,
would be such a default.
4. Conditions. The effectiveness of this Amendment is conditioned upon
Borrower's payment of a $5,000 amendment fee to Bank and delivery to Bank of all
documents required by Bank.
5. Waiver of Default. Bank waives any default or Event of Default under the Loan
Agreement arising out of Borrower's failure to comply with Sections 6.2 and 6.3
for the periods ending December 31, 2005, March 31, 2006 and June 30, 2006,
("Identified Default") but not for any subsequent time or period. This provision
is not a waiver of or consent to any other event, condition, transaction, act or
omission whether related or unrelated to the Identified Default.
6. No Other Changes. Except as specifically provided in this Amendment, it does
not vary the terms and provisions of any note, mortgage, security agreement, or
other document, instrument, or agreement evidencing, securing or relating to the
Indebtedness or the Loan Agreement ("Loan Documents"). This Amendment shall not
impair the rights, remedies, and security given in and by the Loan Documents.
The terms of this Amendment shall control any conflict between its terms and
those of the Loan Agreement.
7. Ratification. Except for the modifications under this Agreement, the parties
ratify and confirm the Loan Agreement and the Loan Documents and agree that they
remain in full force and effect.
8. Further Modification; No Reliance. This Amendment may be altered or modified
only by written instrument duly executed by Borrower and Bank. In executing this
Amendment, Borrower is not relying on any promise or commitment of Bank that is
not in writing signed by Bank.
9. Confirmation of Lien Upon Collateral. Borrower acknowledges and agrees that
the obligations of Borrower under the Loan Agreement and the Loan Documents and
the individual advances under the Indebtedness, are secured by the Collateral
(as defined in the Loan Agreement) and that the Loan Agreement and the Loan
Documents constitute valid, legal, and binding agreements and obligations of
Borrower. The Collateral is and shall remain subject to and encumbered by the
lien, charge, and encumbrance of any applicable Loan Document, and nothing
herein contained shall affect or be construed to affect the lien or encumbrance
created by any applicable Loan Document respecting the Collateral, or its
priority over other liens or encumbrances.
10. Successors and Assigns. This Amendment shall inure to the benefit of and be
binding upon the parties and their respective successors and assigns.
11. Governing Law. The parties agree that the terms and provisions of this
Amendment shall be governed by and construed in accordance with the internal
laws of the State of Michigan, without regard to principles of conflicts of law.
12. No Defenses. Borrower acknowledges, confirms, and warrants to Bank that as
of the date hereof Borrower has absolutely no defenses, claims, rights of
set-off, or counterclaims against Bank under, arising out of, or in connection
with, this Amendment, the Loan Agreement, the Loan Documents and/or the
individual advances under the Indebtedness, or against any of the indebtedness
evidenced or secured thereby.
13. Expenses. Borrower shall promptly pay all out-of-pocket fees, costs,
charges, expenses, and disbursements of Bank incurred in connection with the
preparation, execution, and delivery of this Amendment, and the other documents
contemplated by this Amendment.
14. Counterparts. This Amendment may be executed in one or more counterparts,
and by separate parties on separate counterparts, all of which shall constitute
one and the same agreement.
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This Amendment to Loan Agreement is executed and delivered as of the Effective
Date.
COMERICA BANK FAMILY HOME HEALTH SERVICES INC.
By: By:
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Xxxxxxx X. Xxxxxxxx Xxxxx Xxxxx
Its: Vice President Its: CEO
ACKNOWLEDGEMENT AND CONSENT OF GUARANTORS
Each of the undersigned has guaranteed the payment and performance of
the Indebtedness by Borrower pursuant to Guaranty dated November 10, 2005. Each
of the undersigned acknowledges and consents to the execution, delivery and
performance of the foregoing Amendment to Loan Agreement and agrees that its
guaranty remains in full force and effect.
Signature:
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Name: Xxxxx Xxxxx
Dated:
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Signature:
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Name: Xxxxx Xxxxxxxxxx
Dated:
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