Amendment Number 2 to Loan and Security Agreement



 Exhibit 10.5 
  
 $8,000,000.00 REVOLVING CREDIT LOAN 
  
 AMENDMENT NO. 2 
  
 TO 
  
 LOAN AND SECURITY AGREEMENT 
  
 originally dated as of August 31, 2000 
  
 by and among 
  
 HEALTHMONT, INC., 
 HEALTHMONT OF GEORGIA, INC. 
 (dba Memorial Hospital of Adel and Memorial Convalescent Center), 
 HEALTHMONT
OF TEXAS, INC., 
 HEALTHMONT OF TEXAS I, LLC (dba Dolly Vinsant Memorial Hospital), 
 HEALTHMONT OF OREGON I, INC., 
 HEALTHMONT OF OREGON II, INC., 
 HEALTHMONT OF OREGON III, INC. (dba Woodland Park Medical Plaza), 
 HEALTHMONT OF OREGON V, LLC (dba Woodland Park Hospital), 
 HEALTHMONT OF OREGON IV, LLC (dba Eastmoreland Hospital), and 
 HEALTHMONT OF MISSOURI, INC. (dba
Callaway County Community Hospital) 
 (collectively, “Borrower”) 
  
 and 
  
 HELLER HEALTHCARE FINANCE, INC. 
 (“Lender”) 
  
 Amended as of February 28, 2002 
  









 AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT 
  
 THIS AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT (this
“Amendment”) is made as of February 28, 2002, by and among HEALTHMONT, INC., a Tennessee corporation, HEALTHMONT OF GEORGIA, INC., a Tennessee corporation (dba Memorial Hospital of Adel and Memorial Convalescent
Center), HEALTHMONT OF TEXAS, INC., a Tennessee corporation, HEALTHMONT OF TEXAS I, LLC, a Tennessee limited liability company (dba Dolly Vinsant Memorial Hospital), HEALTHMONT OF MISSOURI, INC., a Tennessee corporation (dba
Callaway County Community Hospital) (collectively, the “Continuing Borrower”), HEALTHMONT OF OREGON I, INC., a Tennessee corporation, HEALTHMONT OF OREGON II, INC., a Tennessee corporation, HEALTHMONT OF OREGON III, INC.,
a Tennessee corporation (dba Woodland Park Medical Plaza), HEALTHMONT OF OREGON V, LLC, a Tennessee limited liability company (dba Woodland Park Hospital), and HEALTHMONT OF OREGON IV,
LLC, a Tennessee limited liability company (dba Eastmoreland Hospital) (collectively, the “Withdrawing Borrower”; the Continuing Borrower and the Withdrawing Borrower are sometimes collectively referred to herein as the
“Borrower”), and HELLER HEALTHCARE FINANCE, INC., a Delaware corporation (“Lender”). 
  
 RECITALS 
  
 A. Pursuant to that certain Loan and Security Agreement dated August 31, 2000 by and among Borrower and Lender (as amended, restated, modified or
supplemented from time to time, the “Loan Agreement”), the parties have established certain financing arrangements that allow Borrower to borrow funds from Lender in accordance with the terms and conditions set forth in the Loan Agreement.

  
 B. Borrower now wishes to effect the withdrawal of
Withdrawing Borrower as a Borrower under the Loan Agreement, and to make such further amendments as are necessary to effect such transaction. 
  
 C. Capitalized terms used but not defined in this Amendment shall have the meanings that are set forth in the Loan Agreement. 
  
 NOW, THEREFORE, in consideration of the premises set forth above, the
terms and conditions contained in this Amendment, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Lender and Borrower have agreed to the following amendments to the Loan Agreement. 

 
 1. Withdrawal of Withdrawing Borrower. Lender, Continuing Borrower
and Withdrawing Borrower agree that Withdrawing Borrower shall no longer be party to the Loan Agreement or the other Loan Documents and will not be bound by any of the conditions, covenants, representations, warranties and other agreements set forth
in the Loan Agreement. 
  









 2. Other Amendments to Loan Agreement. Section 9.4 shall be deleted in its entirety and
substituted with the following language: 
  
 “Section
9.4. Notices. Any notice or other communication required or permitted under this Agreement shall be in writing and personally delivered, mailed by registered or certified mail (return receipt requested and postage prepaid), sent by
telecopier (with a confirming copy sent by regular mail), or sent by prepaid overnight courier service, and addressed to the relevant party at its address set forth below, or at such other address as such party may, by written notice, designate as
its address for purposes of notice under this Agreement: 
  

			
	 If to Borrower:
	  	 c/o Healthmont, Inc.
 113 Seaboard
Lane
 Suite C-200
 Franklin, Tennessee 37067
 Attn: President
 Telephone: (615) 250-7800
 Telecopy: (615) 250-7802

		
	 If to Lender:
	  	 Heller Healthcare Finance, Inc.
 2 Wisconsin
Circle, Suite 400
 Chevy Chase Maryland 20815
 Attn: Chief
Counsel
 Telephone: (301) 664-9857
 Telecopy: (331)
664-9866”


  
 3. Confirmation of
Representations and Warranties. Each of the Continuing Borrowers hereby confirms that all of the representations and warranties set forth in Article IV of the Loan Agreement are true and correct with respect to the Continuing Borrowers, and
specifically represents and warrants to Lender that it has good and marketable title to all of its respective Collateral, free and clear of any lien or security interest in favor of any other person or entity. 
  
 4. Updated Schedules. As a condition precedent to Lender’s
agreement to enter into this Amendment, and in order for this Amendment to be effective, Continuing Borrower shall revise, update and deliver to Lender all Schedules to the Loan Agreement to (a) reflect updated and accurate information with respect
to Continuing Borrower, and (b) to update all other information as necessary to make the Schedules previously delivered correct. Continuing Borrower hereby represents and warrants that the information set forth on the attached Schedules is true and
correct as of the date of this Agreement. The attached Schedules are hereby incorporated into the Loan Agreement as if originally set forth therein. 
  
 5. Costs. In connection with the execution and delivery of this Amendment and the related amendment documents executed and delivered as of the date
hereof, Borrower shall unconditionally pay to the Lender a modification fee of $10,000. In addition, Borrower shall be responsible for the payment of all costs of Lender incurred in connection with the preparation of this Amendment, including all
reasonable fees of Lender’s in-house counsel. Borrower hereby authorizes Lender to deduct all of such fees set forth in this Section 5 from the proceeds of the next Revolving Credit Loan. 
  

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 6. Reference to the 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 similar import shall mean and be a reference to the Loan Agreement as amended by this Amendment. 
  
 (b) Except as specifically amended above, the Loan
Agreement, and all other Loan Documents, shall remain in full force and effect, and are hereby ratified and confirmed. 
  
 (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided in this Amendment, 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 and agreements executed or delivered in connection with the Loan Agreement. 
  
 7. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Maryland. 
  
 8.
Headings. Section headings in this Amendment are included 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 in counterparts, and both counterparts taken together shall be deemed
to constitute one and the same instrument. 
  
 [SIGNATURES APPEAR
ON FOLLOWING PAGE] 
  

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 IN WITNESS WHEREOF, the parties have caused this Amendment to be executed as of the date first
written above. 
  

					
	LENDER:	 	 
		
	 HELLER HEALTHCARE FINANCE, INC.,
 a Delaware corporation
	 	 
			
	By:	 	/s/    JOSEPH PRANDONI        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	JOSEPH PRANDONI
	 	 
	 Title:
	 	VICE PRESIDENT	 	 
		
	CONTINUING BORROWER:	 	 
		
	 HEALTHMONT, INC.,
 a Tennessee
corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 
		
	 HEALTHMONT OF GEORGIA, INC.,
 a Tennessee corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 
		
	 HEALTHMONT OF TEXAS, INC.,
 a
Tennessee corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 
		
	 HEALTHMONT OF MISSOURI, INC.,
 a
Tennessee corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 


  

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	 HEALTHMONT OF TEXAS I, LLC,
 a
Tennessee limited liability company
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	Chief Manager	 	 


  

					
	WITHDRAWING BORROWER:	 	 
		
	 HEALTHMONT OF OREGON I , INC.,
 a
Tennessee corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 


  

					
	 HEALTHMONT OF OREGON II, INC.,
 a
Tennessee corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 


  

					
	 HEALTHMONT OF OREGON III, INC.,
 a
Tennessee corporation
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	President	 	 


  

					
	 HEALTHMONT OF OREGON IV, LLC,
 a Tennessee limited liability company
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	Chief Manager	 	 


  

					
	 HEALTHMONT OF OREGON V, LLC,
 a
Tennessee limited liability company
	 	 
			
	By:	 	/s/    TIMOTHY S. HILL        	 	(SEAL)
	 	 	
	 	 
	 Name:
	 	Timothy S. Hill
	 	 
	 Title:
	 	Chief Manager	 	 


  

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