Amendment No. 2 to Loan Documents



 Exhibit 10.3 
  
 Silicon Valley
Bank 
  
 Amendment to Loan
Documents 
  

			
	Borrower:	 	 Essential Group, Inc.
 AmericasDoctor.com
Coordinator Services, Inc.

	Date:	 	September 27, 2004

  
 THIS AMENDMENT TO
LOAN DOCUMENTS is entered into between Silicon Valley Bank (“Silicon”) and the borrower named above (“Borrower”). 
  
 The Parties agree to amend the Loan and Security Agreement between them, dated September 27, 2004 (as otherwise amended, if at all, the “Loan
Agreement”), as follows, effective as of the date hereof. (Capitalized terms used but not defined in this Amendment shall have the meanings set forth in the Loan Agreement.) 
  
 1. Amendment to Advance Rate. The clause in Section 1 of the Schedule to Loan and Security Agreement that currently
reads as follows: 
  
 An amount not to exceed the lesser of: (i)
$6,000,000 at any one time outstanding (the “Maximum Credit Limit”), or (ii) 80% (an “Advance Rate”) of the amount of Borrower’s Eligible Accounts (as defined in Section 8 above). 
  
 is hereby amended to read as follows: 
  
 An amount not to exceed the lesser of: (i) $6,000,000 at any one time
outstanding (the “Maximum Credit Limit”), or (ii) 80% (an “Advance Rate”) of the amount of Borrower’s Eligible Accounts (as defined in Section 8 above); provided, however, if Borrower’s Adjusted Quick
Ratio (as defined below), determined on a consolidated basis, is less than 0.75 to 1.0 as of the end of any given month, then such Advance Rate shall be 75% of the amount of Borrower’s Eligible Accounts until such time as Borrower’s
Adjusted Quick Ratio, determined on a consolidated basis, equals or exceeds 0.75 to 1.0 as of the end of any given month in which instance, the Advance Rate will revert to 80% of the amount of Borrower’s Eligible Accounts. 
  
 2. Amendment to Interest Rate. The clause in Section 2 of the Schedule
to Loan and Security Agreement that currently reads as follows: 
  
 Interest Rate (Section 1.2): 
  
 A rate equal to
the “Prime Rate” in effect from time to time, plus 1.0% per annum, provided that the interest rate in effect on any day shall not be less than 5.5% per annum. Interest shall be calculated 
  

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 Silicon Valley BankAmendment to Loan Agreement 
  
 on the basis of a 360-day year for the actual number of days elapsed. As
used in this Agreement, “Prime Rate” means the interest rate announced from time to time by Silicon as its “prime rate” (which is a base rate upon which other rates charged by Silicon are based, and it is not necessarily the best
rate available at Silicon). The interest rate applicable to the Obligations shall change on each date there is a change in the Prime Rate. 
  
 is hereby amended to read as follows: 
  
 Interest Rate (Section 1.2): 
  
 A rate equal to the “Prime Rate” in effect from time to time, plus 1.0% per annum, provided, however, if Borrower’s Adjusted
Quick Ratio, determined on a consolidated basis, is less than 0.75 to 1.0 as of the end of any given month, then a rate equal to the “Prime Rate” in effect from time to time, plus 2.0% per annum until such time as Borrower’s Adjusted
Quick Ratio, determined on a consolidated basis, equals or exceeds 0.75 to 1.0 as of the end of any given month in which instance, the applicable interest rate will revert to a rate equal to the “Prime Rate” in effect from time to time,
plus 1.0% per annum, provided, further, that the interest rate in effect on any day shall not be less than 5.5% per annum. Interest shall be calculated on the basis of a 360-day year for the actual number of days elapsed. As used in
this Agreement, “Prime Rate” means the interest rate announced from time to time by Silicon as its “prime rate” (which is a base rate upon which other rates charged by Silicon are based, and it is not necessarily the best rate
available at Silicon). The interest rate applicable to the Obligations shall change on each date there is a change in the Prime Rate. 
  
 3. Amendment to Adjusted Quick Ratio Financial Covenant. The Adjusted Quick Ratio Financial Covenant set forth in Section 5 of the Schedule to Loan
and Security Agreement is hereby amended to read as follows: 
  

			
	 Adjusted
	 	 
	 Quick Ratio:
	 	 For the month ending August 31, 2004 and for each month ending thereafter through the month ending June 30, 2005, Borrower shall maintain an Adjusted Quick
Ratio of not less than 0.75 to 1.0; provided, however, if Borrower’s Adjusted Quick Ratio is less than 0.75 to 1.0 but at least 0.65 to 1.0, then such violation will not be deemed an Event of Default, however, the adjustments to
the Advance Rate and Interest Rate will go into effect. Adjustments to the Advance Rate and Interest Rate will be effective upon the receipt by Silicon of Borrower’s financial statements evidencing Borrower’s Adjusted
Quick


  

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 Silicon Valley BankAmendment to Loan Agreement 
  

					
	 	  	 	  	Ratio has dropped to between 0.75 to 1.0 and 0.65 to 1.0, or has risen to equal or exceed 0.75 to 1.0, as applicable. For example, if Borrower’s Adjusted Quick Ratio dropped to 0.70 to
1.0 for the month ending November 30, 2004, then upon Silicon’s receipt of Borrower’s financial statements evidencing Borrower’s Adjusted Quick Ratio, the adjustments to the Advance Rate (80% to 75%) and Interest Rate (Prime Rate plus
1.0% per annum to Prime Rate plus 2.0% per annum) would go into effect. Similarly, if Borrower’s Adjusted Quick Ratio then rises to 0.75 to 1.0 for the month ending January 31, 2005, then upon Silicon’s receipt of Borrower’s financial
statements evidencing Borrower’s Adjusted Quick Ratio, the adjustments to the Advance Rate (75% to 80%) and Interest Rate (Prime Rate plus 2.0% per annum to Prime Rate plus 1.0% per annum) would go into effect; and
			
	 	  	 	  	For the month ending July 31, 2005 and for each month ending thereafter, Borrower shall maintain an Adjusted Quick Ratio of not less than 0.75 to 1.0.

  
 4. Fee. In
consideration for Silicon entering into this Amendment, Borrower shall concurrently pay Silicon a fee in the amount of $6,250, which shall be non-refundable and in addition to all interest and other fees payable to Silicon under the Loan Documents.
Silicon is authorized to charge said fee to Borrower’s loan account. 
  
 5. Representations True. Borrower represents and warrants to Silicon that all representations and warranties set forth in the Loan Agreement, as amended hereby, are true and correct (except to the extent that
such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct as of such earlier date). 
  
 6. General Provisions. This Amendment, the Loan Agreement, any prior written amendments to the Loan Agreement signed by Silicon and Borrower, and
the other written documents and agreements between Silicon and Borrower set forth in full all of the representations and agreements of the parties with respect to the subject matter hereof and supersede all prior discussions, representations,
agreements and understandings between the parties with respect to the subject hereof. Except as herein expressly amended, all of the terms and provisions of the Loan Agreement, and all other documents and agreements between Silicon and Borrower
shall continue in full force and effect and the same are hereby ratified and confirmed. 
  

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 Silicon Valley BankAmendment to Loan Agreement 
  

							
	Borrower:	 	Silicon:
		
	ESSENTIAL GROUP, INC.	 	SILICON VALLEY BANK
				
	 By
	 	 /s/ Essential Group, Inc.

	 	By	 	 /s/ Silicon Valley Bank


	 	 	 President or Vice President
	 	Title	 	  


				
	 By
	 	  

	 	 	 	 
	 	 	 Secretary or Ass’t Secretary
	 	 	 	 

  

			
	 Borrower:

	
	 AMERICASDOCTOR.COM
 COORDINATOR SERVICES, INC.

		
	 By
	 	 /s/AmericasDoctor.com Coordinator Services, Inc.


	 	 	President or Vice President
		
	 By
	 	  


	 	 	Secretary or Ass’t Secretary

  

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