Exhibit
10.1


$20,000,000.00


 


AMENDMENT NO.7 TO


 


AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT


 


originally dated as of March 25, 2004 by and among


 


THE ENSIGN GROUP, INC., ENSIGN
WHITTIER WEST LLC,

ENSIGN WHITTIER EAST LLC, ENSIGN SANTA ROSA LLC, ENSIGN PANORAMA LLC, ENSIGN

SABINO LLC, ENSIGN SAN DIMAS LLC, ENSIGN MONTGOMERY LLC,  ENSIGN PALM I LLC,

ENSIGN SONOMA LLC, ENSIGN CLOVERDALE LLC,

ENSIGN WILLITS LLC, ENSIGN PLEASANTON LLC,

24TH STREET HEALTHCARE ASSOCIATES LLC,

GLENDALE HEALTHCARE ASSOCIATES LLC,

ATLANTIC MEMORIAL HEALTHCARE ASSOCIATES, INC.,

ROSE PARK HEALTHCARE ASSOCIATES, INC.,

LEMON GROVE HEALTH ASSOCIATES LLC,

PRESIDIO HEALTH ASSOCIATES LLC, BELL VILLA CARE ASSOCIATES LLC,

DOWNEY COMMUNITY CARE LLC, COSTA VICTORIA HEALTHCARE LLC,

WEST ESCONDIDO HEALTHCARE LLC, REDBROOK HEALTHCARE ASSOCIATES LLC,

HB HEALTHCARE ASSOCIATES LLC, NORTH MOUNTAIN HEALTHCARE LLC,

PARK WAVERLY HEALTHCARE LLC, SUNLAND HEALTH ASSOCIATES LLC,

VISTA WOODS HEALTH ASSOCIATES LLC, CITY HEIGHTS HEALTH ASSOCIATES LLC,

CLAREMONT FOOTHILLS HEALTH ASSOCIATES LLC,

C STREET HEALTH ASSOCIATES LLC, VICTORIA VENTURA HEALTHCARE LLC

RADIANT HILLS HEALTH ASSOCIATES LLC, HIGHLAND HEALTHCARE LLC,

GATE THREE HEALTHCARE LLC, SOUTHLAND MANAGEMENT LLC,

MANOR PARK HEALTHCARE LLC, NORTHERN OAKS HEALTHCARE, INC.,

SALADO CREEK SENIOR CARE, INC., MCALLEN COMMUNITY HEALTHCARE, INC.,

WELLINGTON HEALTHCARE, INC.

(collectively, “Borrower”)


 


and


 


GENERAL ELECTRIC CAPITAL CORPORATION


(“Lender”)


 


Amended as of December 21, 2007


 

















 


AMENDMENT NO. 7 TO AMENDED AND


RESTATED LOAN AND SECURITY AGREEMENT


 


THIS
AMENDMENT NO. 7 TO AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT (this “Amendment”) is made as of
this 21st day of December 2007 (the “Effective Date”),
by and among THE ENSIGN GROUP, INC., a Delaware
corporation, ENSIGN WHITTIER WEST LLC,  a Nevada
limited liability company, ENSIGN WHITTIER EAST LLC,
a Nevada limited liability company, ENSIGN SANTA ROSA LLC,
a Nevada limited liability company, and ENSIGN PANORAMA LLC,
a Nevada limited liability company, ENSIGN SABINO LLC,
a Nevada limited liability company, ENSIGN SAN DIMAS LLC, a Nevada limited liability company, ENSIGN MONTGOMERY LLC, a Nevada limited liability company, ENSIGN CLOVERDALE LLC, a Nevada limited liability company, ENSIGN PALM I LLC, a Nevada limited liability company, ENSIGN SONOMA LLC, a Nevada limited liability company, ENSIGN WILLITS LLC, a Nevada limited liability company, ENSIGN PLEASANTON LLC, a Nevada limited liability company, 24th STREET HEALTHCARE ASSOCIATES LLC, a Nevada
limited liability company, GLENDALE HEALTHCARE
ASSOCIATES LLC, a Nevada limited liability company, ATLANTIC MEMORIAL HEALTHCARE ASSOCIATES, INC., a Nevada
corporation, and ROSE PARK HEALTHCARE ASSOCIATES, INC.,
a Nevada corporation, LEMON GROVE HEALTH
ASSOCIATES LLC, a Nevada limited liability company, PRESIDIO HEALTH ASSOCIATES LLC, a Nevada
limited liability company, BELL VILLA CARE
ASSOCIATES LLC, a Nevada limited liability company, DOWNEY COMMUNITY CARE LLC, a Nevada limited
liability company, COSTA VICTORIA HEALTHCARE
LLC, a Nevada limited liability company, WEST ESCONDIDO HEALTHCARE LLC, a Nevada limited liability
company, REDBROOK HEALTHCARE ASSOCIATES LLC,
a Nevada limited liability company, HB
HEALTHCARE ASSOCIATES LLC, a Nevada limited liability company, NORTH MOUNTAIN HEALTHCARE LLC, a Nevada
limited liability company, PARK WAVERLY
HEALTHCARE LLC, a Nevada limited liability company, SUNLAND HEALTH ASSOCIATES LLC, a Nevada
limited liability company, VISTA WOODS HEALTH
ASSOCIATES LLC, a Nevada limited liability company, CITY HEIGHTS HEALTH ASSOCIATES LLC, a
Nevada limited liability company, CLAREMONT
FOOTHILLS HEALTH ASSOCIATES LLC, a Nevada limited liability company,
C STREET HEALTH ASSOCIATES LLC, a
Nevada limited liability company, and VICTORIA
VENTURA HEALTHCARE  LLC,
a Nevada limited liability company, RADIANT
HILLS HEALTH ASSOCIATES LLC, a Nevada limited liability company, HIGHLAND HEALTHCARE LLC, a Nevada limited
liability company, GATE THREE HEALTHCARE LLC,
a Nevada limited liability company, SOUTHLAND
MANAGEMENT LLC, Nevada limited liability company, MANOR PARK HEALTHCARE LLC, a Nevada limited
liability company, NORTHERN OAKS HEALTHCARE,
INC., a Nevada corporation, SALADO
CREEK SENIOR CARE, INC., a Nevada corporation, McALLEN COMMUNITY HEALTHCARE, INC., a
Nevada corporation, WELLINGTON HEALTHCARE,
INC., a Nevada corporation (collectively “Borrower”), and GENERAL ELECTRIC CAPITAL CORPORATION, a Delaware corporation
(“Lender”).


 


RECITALS


 


A.            Pursuant to that certain Amended and
Restated Loan and Security Agreement dated as of March 25, 2004 by and
between Borrower and Lender (as amended, modified and restated from time to
time, the “Loan Agreement”), the parties have established certain
financing arrangements that allow funds to be borrowed from Lender in accordance
with the terms and conditions set forth in the Loan Agreement.


 


B.            The parties now desire to amend the
Loan Agreement in accordance with the terms and conditions set forth below.


 


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, the parties have
agreed to the following amendments to the Loan Agreement.  Capitalized terms used but not defined in
this Amendment shall have the meanings that are set forth in the Loan
Agreement.


 


1.             Amendment to Loan
Agreement Section 2.8(a) of
the Loan Agreement is hereby amended by deleting the existing Section 2.8(a) in
its entirety and by inserting in lieu thereof the following new Section 2.8(a):


 

















 


                                                                                                “(a)         Subject
to Lender’s right to cease making Revolving Credit Loans to Borrower upon or
after any Event of Default, this Agreement shall be in effect until February 22,
2008, unless terminated as provided in this Section 2.8 (the “Term”).”


 


2.             Confirmation of Representations
and Warranties.  Borrower hereby (a) confirms that all of
the representations and warranties set forth in Article IV of the Loan
Agreement are true and correct, and (b) 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, except as identified in Schedule 1.39 and
Schedule 4.19 to the Loan Agreement, each as updated, and as otherwise
permitted pursuant to the Loan Agreement.


 


3.             Effective
Date.  This Amendment shall be effective upon Lender’s
receipt of this Amendment executed by a duly authorized member and/or officer
of each Borrower.


 


4.             Fees and Expenses.   Borrower shall
be responsible for the payment of all costs and expenses incurred by Lender in
connection with the preparation of this Amendment including any and all fees
and expenses of Lender’s in-house counsel.


 


5.             Updated
Schedules.  As a condition precedent to Lender’s
agreement to enter into this Amendment, and in order for this Amendment to be
effective, Borrower shall revise, update and deliver to Lender all Schedules to
the Loan Agreement to update all information as necessary to make the Schedules
previously delivered correct. Borrower hereby represents and warrants that the
information set forth on the attached Schedules is true and correct as of the
date of this Amendment.  The attached
Schedules are hereby incorporated into the Loan Agreement as if originally set
forth therein.


 


6.             Enforceability.  This Amendment
constitutes the legal, valid and binding obligation of each Borrower and is
enforceable against each such Borrower in accordance with its terms.


 


7.             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.


 


(d)           This Amendment (together with any
other document executed in connection herewith) is not intended to be, nor
shall it be construed as, a novation of the Loan Agreement.


 


8.             Governing Law. 
This Amendment shall be governed by and construed in accordance with the
laws of the State of Maryland.


 


9.             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.


 


10.          Counterparts. 
This Amendment may be executed in counterparts, and such counterparts
taken together shall be deemed to constitute one and the same instrument.


 

















 


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


 


	
   

  	
  LENDER:

  
	
   

  	
  GENERAL
  ELECTRIC CAPITAL CORPORATION

  
	
   

  	
  a Delaware
  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey P.
  Hoffman

  	
   

  
	
   

  	
  Name: 

  	
  Jeffrey P.
  Hoffman

  
	
   

  	
  Title: 

  	
  Duly Authorized
  Signatory

  
					



 

















 


BORROWER:


 


	
  ATTEST/WITNESS:

  	
  THE
  ENSIGN GROUP, INC.

  	
   

  
	
   

  	
  a Delaware corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Alan J. Norman

  	
   

  	
  By:

  	
  /s/ Gregory K. Stapley

  	
   

  	
   

  
	
   

  	
  Alan J. Norman

  	
   

  	
  Gregory K. Stapley

  	
   

  
	
   

  	
  Vice President

  	
   

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	 
	
   

  	
  ENSIGN
  WHITTIER WEST LLC

  
	 
	
   

  	
  ENSIGN
  WHITTIER EAST LLC

  
	 
	
   

  	
  ENSIGN
  PANORAMA LLC

  
	 
	
   

  	
  LEMON
  GROVE HEALTH ASSOCIATES LLC

  
	 
	
   

  	
  BELL
  VILLA CARE ASSOCIATES LLC

  
	 
	
   

  	
  DOWNEY COMMUNITY CARE LLC

  
	 
	
   

  	
  COSTA VICTORIA HEALTHCARE LLC

  
	 
	
   

  	
  WEST
  ESCONDIDO HEALTHCARE LLC

  
	 
	
   

  	
  HB
  HEALTHCARE ASSOCIATES LLC

  
	 
	
   

  	
  VISTA
  WOODS HEALTH ASSOCIATES LLC

  
	 
	
   

  	
  CITY
  HEIGHTS HEALTH ASSOCIATES LLC

  
	 
	
   

  	
  C
  STREET HEALTH ASSOCIATES LLC

  
	 
	
   

  	
  VICTORIA
  VENTURA HEALTH CARE LLC

  
	 
	
   

  	
  GATE
  THREE HEALTHCARE LLC

  
	 
	
   

  	
  SOUTHLAND
  MANAGEMENT LLC

  
	 
	
   

  	
  MANOR
  PARK HEALTHCARE LLC

  
	 
	
   

  	
  each, a Nevada
  limited liability company

  
	 
	
   

  	
   

  
	 
	
  ATTEST/WITNESS:

  	
  By:

  	
  The Flagstone
  Group, Inc.

  	
   

  
	 
	
   

  	
   

  	
  Its Sole Member

  	
   

  
	 
	
   

  	
   

  	
   

  
	 
	
  By:

  	
  /s/ Daniel Walker

  	
   

  	
  By:

  	
   /s/ Beverly Wittekind

  	
   

  
	 
	
   

  	
  Daniel H Walker

  	
   

  	
  Beverly Wittekind

  	
   

  
	 
	
   

  	
   

  	
  Secretary

  	
   

  
	 
	
   

  	
   

  	
   

  	
   

  
	 
	
   

  	
  ENSIGN SANTA ROSA LLC

  
	 
	
   

  	
  ENSIGN MONTGOMERY LLC

  
	 
	
   

  	
  ENSIGN CLOVERDALE LLC

  
	 
	
   

  	
  ENSIGN SONOMA LLC

  
	 
	
   

  	
  ENSIGN WILLITS LLC

  
	 
	
   

  	
  ENSIGN PLEASANTON LLC

  
	 
	
   

  	
  each, a Nevada limited liability company

  
	 
	
   

  	
   

  
	 
	
  ATTEST/WITNESS:

  	
  By:

  	
  Northern Pioneer
  Healthcare, Inc.

  
	 
	
   

  	
   

  	
  Its Sole Member

  
	 
	
   

  	
   

  
	 
	
  By:

  	
  /s/ Daniel Walker

  	
   

  	
  By:

  	
   /s/ Beverly Wittekind

  	
   

  
	 
	
   

  	
  Daniel H Walker

  	
   

  	
  Beverly Wittekind

  	
   

  
	 
	
   

  	
   

  	
  Secretary

  	
   

  
															



 

















 


	
   

  	
  ENSIGN SAN DIMAS LLC

  
	
   

  	
  ENSIGN PALM I LLC

  
	
   

  	
  REDBROOK HEALTHCARE ASSOCIATES
  LLC

  
	
   

  	
  CLAREMONT FOOTHILLS HEALTH
  ASSOCIATES LLC

  
	
   

  	
  each, a Nevada limited
  liability company

  
	
   

  	
   

  
	
  ATTEST/WITNESS:

  	
  By:

  	
  Touchstone
  Care, Inc.

  	
   

  
	
   

  	
   

  	
  Its Sole Member

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Daniel Walker

  	
   

  	
  By:

  	
   /s/ Beverly Wittekind

  	
   

  
	
   

  	
  Daniel H Walker

  	
   

  	
  Beverly Wittekind

  	
   

  
	
   

  	
   

  	
  Secretary

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ENSIGN SABINO LLC

  
	
   

  	
  24TH STREET
  HEALTHCARE ASSOCIATES LLC

  
	
   

  	
  GLENDALE
  HEALTHCARE ASSOCIATES LLC

  
	
   

  	
  PRESIDIO HEALTH ASSOCIATES LLC

  
	
   

  	
  NORTH MOUNTAIN HEALTHCARE LLC

  
	
   

  	
  PARK WAVERLY HEALTHCARE LLC

  
	
   

  	
  SUNLAND HEALTH ASSOCIATES LLC

  
	
   

  	
  RADIANT
  HILLS HEALTH ASSOCIATES LLC

  
	
   

  	
  HIGHLAND
  HEALTHCARE LLC

  
	
   

  	
  each, a Nevada limited
  liability company

  
	
   

  	
   

  
	
  ATTEST/WITNESS:

  	
  By:

  	
  Bandera
  Healthcare, Inc.

  
	
   

  	
   

  	
  Its Sole Member

  
	
   

  	
   

  
	
  By:

  	
  /s/ Daniel Walker

  	
   

  	
  By:

  	
   /s/ Beverly Wittekind

  	
   

  
	
   

  	
  Daniel H Walker

  	
   

  	
  Beverly Wittekind

  	
   

  
	
   

  	
   

  	
  Secretary

  	
   

  
	
   

  	
   

  
	
   

  	
  ATLANTIC
  MEMORIAL HEALTHCARE ASSOCIATES, INC.

  
	
   

  	
  ROSE PARK HEALTHCARE
  ASSOCIATES, INC.

  
	
  ATTEST/WITNESS:

  	
  each, a Nevada
  corporation

  
	
   

  	
   

  
	
  By:

  	
  /s/ Daniel Walker

  	
   

  	
  By:

  	
   /s/ Beverly Wittekind

  	
   

  
	
   

  	
  Daniel H Walker

  	
   

  	
  Beverly Wittekind

  	
   

  
	
   

  	
   

  	
  Secretary

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NORTHERN
  OAKS HEALTHCARE, INC.

  
	
   

  	
  SALADO CREEK SENIOR CARE, INC.

  
	
   

  	
  MCALLEN COMMUNITY HEALTHCARE,
  INC.

  
	
   

  	
  WELLINGTON
  HEALTHCARE, INC.

  
	
  ATTEST/WITNESS:

  	
  each, a Nevada
  corporation

  
	
   

  	
   

  
	
  By:

  	
  /s/ Daniel Walker

  	
   

  	
  By:

  	
   /s/ Beverly Wittekind

  	
   

  
	
   

  	
  Daniel H Walker

  	
   

  	
  Beverly Wittekind

  	
   

  
	
   

  	
   

  	
  Secretary

  	
   

  
										



 

















 


LIST
OF SCHEDULES


 


	
  Schedule 1.39

  	
   

  	
  -

  	
   

  	
  Permitted Liens

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.1

  	
   

  	
  -

  	
   

  	
  Subsidiaries

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.5

  	
   

  	
  -

  	
   

  	
  Litigation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.13

  	
   

  	
  -

  	
   

  	
  Non-Compliance with Law

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.14

  	
   

  	
  -

  	
   

  	
  Environmental Matters

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.15

  	
   

  	
  -

  	
   

  	
  Places of Business with
  patient census

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.16

  	
   

  	
  -

  	
   

  	
  Licenses

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.17

  	
   

  	
  -

  	
   

  	
  Stock Ownership

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.19

  	
   

  	
  -

  	
   

  	
  Borrowings and
  Guarantees

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.21

  	
   

  	
  -

  	
   

  	
  Trade Names

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 4.22

  	
   

  	
  -

  	
   

  	
  Joint Ventures

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Schedule 7.12

  	
   

  	
  -

  	
   

  	
  Transactions with Affiliates