Revolving Credit and Security Agreement


    

       

      Exhibit
        10.1

      REVOLVING
        CREDIT AND SECURITY AGREEMENT

       

      Section
        1.   Introduction.

       

      THIS
        REVOLVING CREDIT AND SECURITY AGREEMENT
        (this
“Agreement”) is entered into this 17th
        day of
April,
        2007
        by and
        between PRESIDENTIAL
        HEALTHCARE CREDIT CORPORATION
        (“PHCC”)
        and PARK INFUSION CARE, LP, a Texas limited partnership, formerly known as
        PARK
        INFUSION SERVICES, LP, d/b/a PARK INFUSION CARE, PARK INFUSIONCARE OF DALLAS,
        LP, a Texas limited partnership, PARK INFUSIONCARE OF HOUSTON, LP, a Texas
        limited partnership and PARK INFUSIONCARE OF SAN ANTONIO, LP, a Texas limited
        partnership (together, jointly and severally, the “Provider”). Subject to the
        terms and conditions of this Agreement, the Provider wishes to obtain a
        revolving credit loan from PHCC and PHCC wishes to make a revolving credit
        loan
        to the Provider. Capitalized terms used herein, unless otherwise defined,
        shall
        have the meanings set forth in Appendix I to
        this
        Agreement.

      


      NOW,
        THEREFORE, in consideration of the premises and in order to induce PHCC to
        make
        the Loan, PHCC and the Provider agree as follows.

       

      Section
        2.   Amount
        and Payment of Loan.

       

      (a)  (i)PHCC
        agrees, on the terms and subject to the conditions hereinafter set forth,
        to
        review Advance Requests from the Provider, and to make Advances to the Provider
        during the period from the date hereof to, but not including, the earlier
        of (A)
        the date of termination in whole of this Agreement pursuant to Section 12;
        and
        (B) the Scheduled Maturity Date. Amounts borrowed hereunder may be repaid
        and
        borrowed again from time to time provided that no Event of Default shall
        have
        occurred. The principal amount of the Loan outstanding shall not exceed the
        Maximum Aggregate Loan Amount at any time.

       

      (ii)  Any
        determination as to whether there is availability for Advances shall be made
        by
        PHCC in its reasonable sole discretion and is final and binding upon the
        Provider. Subject to the provisions of this Agreement, the Provider may request
        Advances up to and including the value, in U.S. Dollars, of the “Availability
        Amount” which shall equal (A) eighty-five
        percent (85%)
        of the
        Net Value of Eligible Receivables minus, (B) if applicable, amounts reserved
        pursuant to this Agreement. In addition, if at any time Provider is not entitled
        to any advances by the terms of this Agreement, PHCC may, in its sole
        discretion, make requested advances upon the payment of an overadvance fee
        (an
“Overadvance Fee”) in the amount of one thousand dollars ($1,000.00); however,
        it is expressly acknowledged and agreed that, in such event, Provider shall
        have
        the right, in its sole discretion, to decline to make any requested advance
        and
        to require any payment required under the terms of the Agreement without
        prior
        notice to Provider and the making of any such advances shall not be construed
        as
        a waiver of such right by PHCC.

       


      
        
          
          

        

        
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      (iii)  If
        at any
        time the outstanding balance of the Loan exceeds the lesser of (A) the
        Availability Amount, or (B) the Maximum Aggregate Loan Amount, then Borrower
        shall not be entitled to any additional Advances under the Loan while such
        excess exists and shall immediately remit to PHCC immediately available funds
        sufficient to eliminate such excess and, if PHCC requests, deliver to PHCC
        additional collateral of a value and character satisfactory to
        PHCC.

       

      (iv)  In
        the
        event that the availability of the Loan hereunder expires by the terms of
        this
        Agreement, or by the terms of any agreement extending the Scheduled Maturity
        Date of the Loan, PHCC may, in its sole discretion, make requested Advances;
        however, it is expressly acknowledged and agreed that, in such event, PHCC
        shall
        have the right, in its sole discretion, to decline to make any requested
        Advance
        and may require payment in full of the Loan at any time without prior notice
        to
        Provider and the making of any such Advances shall not be construed as a
        waiver
        of such right by PHCC.

       

      (v)  PHCC,
        in
        its reasonable sole credit judgment, may further adjust the Availability
        Amount
        based upon the Provider’s actual, recent collection history for each payor class
        (i.e., Medicare, Medicaid, commercial insurance, etc.) in a manner consistent
        with PHCC’s underwriting practices and procedures, including, without
        limitation, PHCC’s review and analysis of, among other things, the Provider’s
        historical returns, rebates, discounts, credits and allowances. Also, PHCC
        shall
        have the right to establish from time to time, in its reasonable sole credit
        judgment, reserves against the Availability Amount, which reserves shall
        have
        the effect of reducing the amounts otherwise eligible to be disbursed to
        the
        Provider.

       

      (vi)  Advances
        may be made by PHCC without an Advance Request as hereinafter provided for
        the
        payment of interest due and payable on the Loan and Fees and Reimbursable
        Expenses and for the payment of fees due to the Servicer under the Servicing
        Agreement when such interest and/or fees are due to the extent other moneys
        have
        not been made available by Provider to PHCC (or, in the case of fees due
        Servicer, to Servicer) for such payments and there is sufficient Availability
        Amount for such Advances.

       

      (b)  (i)Advances
        made by PHCC shall be evidenced by, and repayable with interest in accordance
        with, a single Revolving Variable Rate Note of the Provider payable to the
        order
        of PHCC, dated of even date herewith, in the form of Exhibit B hereto (the
        “Note”). PHCC shall record the date and amount of each Advance made and the date
        and amount of each payment of principal thereof, and any such recordation
        shall
        constitute prima facie evidence of the accuracy of the information so recorded.
        PHCC shall, on behalf of the Provider, maintain a register (the “Register”) for
        the recordation of (i) the names and addresses of PHCC and any assignees
        of PHCC
        and (ii) the Commitment of, and the principal amount and interest of the
        Loans
        owing to, PHCC or any assignee from time to time. 

       


      
        
          
          

        

        
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      The
        entries in the Register shall be conclusive, in the absence of manifest error,
        and the Provider, PHCC, and each assignee of PHCC shall treat each Person
        whose
        name is recorded in the Register as the owner of the Loans for all purposes
        of
        this Agreement. The Note shall (A) be dated the date of issuance thereof,
        or,
        with respect to any amendment thereof, the date of such amendment, (B) mature
        on
        the Scheduled Maturity Date and (C) provide for the payment of interest in
        accordance with Section 2(c)(ii). The aggregate principal amount outstanding
        under the Note, together with accrued but unpaid interest thereon, Fees and
        Reimbursable Expenses shall be due and payable on the Scheduled Maturity
        Date.

       

      (ii)  The
        Provider may, in its discretion, prepay the Loan in whole or in part at any
        time
        by paying all or any part of the outstanding principal balance of the Note
        plus
        accrued interest and all other Fees and Reimbursable Expenses then due (the
        “Prepayment Amount”). The Provider shall prepay the Loan in full immediately
        upon demand of PHCC after the occurrence of an Event of Default by paying
        the
        Prepayment Amount.

       

      (c)  (i)Advances
        shall accrue interest at the rate and in the manner set forth in the Note.
        The
        Provider shall make payments of interest and principal as hereinafter described
        (the “Loan Payments”).

       

      (ii)  Accrued
        interest shall be due and payable on each Interest Payment Date.

       

      (iii)  Except
        as
        otherwise expressly provided by this Agreement, the obligations of the Provider
        to make the Loan Payments, to make payments of any Fees and Reimbursable
        Expenses, and to perform and observe the covenants and agreements contained
        herein shall be absolute and unconditional under all circumstances, without
        abatement, diminution, deduction, setoff or defense for any reason. Except
        as
        otherwise may be expressly provided by this Agreement, the Provider shall
        make
        all such payments when due and shall not withhold any Loan Payments or other
        payments due under the Provider Agreements pending final resolution of any
        dispute with PHCC, nor shall the Provider assert any right of setoff or
        counterclaim against its obligation to make any such payments required under
        the
        Provider Agreements.

       

      (iv) Regardless
        of any provision contained in any of the Loan Documents, in no contingency
        or
        event whatsoever shall the aggregate of all amounts that are contracted for,
        charged or received by PHCC pursuant to the terms of this Agreement or any
        of
        the other Loan Documents and that are deemed interest under applicable law
        exceed the highest rate permissible under applicable law. 

       


      
        
          
          

        

        
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      No
        agreements, conditions, provisions or stipulations contained in this Agreement
        or any of the other Loan Documents or the exercise by PHCC of the right to
        accelerate the payment or the maturity of all or any portion of the Obligations,
        or the exercise of any option whatsoever contained in any of the Loan Documents,
        or the prepayment by the Provider of any of the Obligations, or the occurrence
        of any contingency whatsoever, shall entitle PHCC to charge or receive in
        any
        event, interest or any charges, amounts, premiums or fees deemed interest
        by
        applicable law (such interest, charges, amounts, premiums and fees referred
        to
        herein collectively as “Interest”) in excess of the Maximum Rate and in no event
        shall the Provider be obligated to pay Interest exceeding such Maximum Rate,
        and
        all agreements, conditions or stipulations, if any, which may in any event
        or
        contingency whatsoever operate to bind, obligate or compel the Provider to
        pay
        Interest exceeding the Maximum Rate shall be without binding force or effect,
        at
        law or in equity, to the extent only of the excess of Interest over such
        Maximum
        Rate. If any Interest is charged or received in excess of the Maximum Rate
        (“Excess”), the Provider acknowledges and stipulates that any such charge or
        receipt shall be the result of an accident and bona fide error, and such
        Excess,
        to the extent received, shall be applied first to reduce the principal
        Obligations and the balance, if any, returned to the Provider, it being the
        intent of the parties hereto not to enter into a usurious or otherwise illegal
        relationship. The right to accelerate the maturity of any of the Obligations
        does not include the right to accelerate any Interest that has not otherwise
        accrued on the date of such acceleration, and PHCC does not intend to collect
        any unearned Interest in the event of any such acceleration. Provider recognizes
        that, with fluctuations in the rates of interest set forth in the Note and
        the
        Maximum Rate, such an unintentional result could inadvertently occur. All
        monies
        paid to PHCC hereunder or under any of the other Loan Documents, whether
        at
        maturity or by prepayment, shall be subject to any rebate of unearned Interest
        as and to the extent required by applicable law. By the execution of this
        Agreement, the Provider covenants that (i) the credit or return of any Excess
        shall constitute the acceptance by the Provider of such Excess, and (ii)
        the
        Provider shall not seek or pursue any other remedy, legal or equitable, against
        PHCC, based in whole or in part upon contracting for, charging or receiving
        any
        Interest in excess of the Maximum Rate. For the purpose of determining whether
        or not any Excess has been contracted for, charged or received by PHCC, all
        Interest at any time contracted for, charged or received from the Provider
        in
        connection with any of the Loan Documents shall, to the extent permitted
        by
        applicable law, be amortized, prorated, allocated and spread in equal parts
        throughout the full term of the Obligations. The Provider and PHCC shall,
        to the
        maximum extent permitted under applicable law, (i) characterize any
        non-principal payment as an expense, fee or premium rather than as Interest
        and
        (ii) exclude voluntary prepayments and the effects thereof. The provisions
        of
        this Section 2(c)(iv) shall be deemed to be incorporated into every Loan
        Document (whether or not any provision of this Section is referred to therein).
        All such Loan Documents and communications relating to any Interest owed
        by the
        Provider and all figures set forth therein shall, for the sole purpose of
        computing the extent of Obligations, be automatically recomputed by the
        Provider, and by any court considering the same, to give effect to the
        adjustments or credits required by this Section 2(c)(iv).

       


      
        
          
          

        

        
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      (d)  On
        or
        before the Closing Date, the Provider shall pay to PHCC a nonrefundable
        commitment fee in an amount equal to one
        percent (1%)
        of the
        Maximum Aggregate Loan Amount (“Initial Commitment Fee”). 

       

      (e)  All
        payments and reimbursements to PHCC made under any Provider Agreement shall
        be
        free and clear of, and without deduction for, all taxes, levies, imposts,
        deductions, assessments, charges or withholdings and all liabilities with
        respect thereto of any nature whatsoever, excluding taxes to the extent imposed
        on PHCC’s net income. If PHCC shall be required by law to deduct any such
        amounts from or in respect of any sum payable under any Provider Agreement
        to
        PHCC, then the sum payable to PHCC shall be increased as may be necessary
        so
        that, after making all required deductions, PHCC receives an amount equal
        to the
        sum it would have received had no such deductions been made. Notwithstanding
        any
        other provision of any Provider Agreement, if at any time after the Closing
        Date
        (i) any change in any existing law, regulation, treaty or directive or in
        the
        interpretation or application thereof, (ii) any new law, regulation, treaty
        or
        directive enacted or any interpretation or application thereof, or (iii)
        compliance by PHCC with any request or directive (whether or not having the
        force of law) from any governmental authority: (A) subjects PHCC to any tax,
        levy, impost, deduction, assessment, charge or withholding of any kind
        whatsoever with respect to any Provider Agreement, or changes the basis of
        taxation of payments to PHCC of any amount payable thereunder (except for
        net
        income taxes, or franchise taxes imposed in lieu of net income taxes, imposed
        generally by federal, state or local taxing authorities with respect to
        interest, Reimbursable Expenses and Fees payable hereunder or changes in
        the
        rate of tax on the overall net income of PHCC, or (B) imposes on PHCC any
        other
        condition or increased cost in connection with the transactions contemplated
        thereby or participations therein; and the result of any of the foregoing
        is to
        increase the cost to PHCC of making or continuing any Loan or Advance hereunder
        or to reduce any amount receivable hereunder, then, in any such case, the
        Provider shall promptly pay to PHCC any additional amounts necessary to
        compensate PHCC, on an after-tax basis, for such additional cost or reduced
        amount as determined by PHCC. If PHCC becomes entitled to claim any additional
        amounts pursuant to this Section it shall promptly notify the Provider of
        the
        event by reason of which PHCC has become so entitled, and each such notice
        of
        additional amounts payable pursuant to this Section submitted by PHCC to
        the
        Provider shall, absent manifest error, be final, conclusive and binding for
        all
        purposes and shall be payable on each Interest Payment Date.

       

      (f)  (i)The
        Servicer will prepare and deliver an Availability Certificate to the Provider
        by
        10:00 a.m. on the Business
        Day prior to each Advance Day. The Availability Certificate shall identify
        the
        aggregate Net Value of all Eligible Receivables pledged to PHCC as Collateral
        hereunder, the outstanding principal balance of the Loan, all Reimbursable
        Expenses and Fees then due, the Availability Amount and such other information
        regarding Eligible Receivables as is required by the Availability
        Certificate.

       


      
        
          
          

        

        
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      (ii) Each
        Advance Request shall be made by the Provider prior to 12:00 p.m. (Central
        Standard/Daylight Time) on the Advance Day by an Authorized Person by delivery
        to PHCC with a copy to the Servicer. 

       

      (iii) Upon
        receipt of the Advance Request and satisfaction of all applicable conditions
        set
        forth in this Section 2, PHCC shall disburse the amount of the Advance on
        the
        Advance Day by crediting the same to the account of the Provider identified
        in
        Exhibit C or such other account as may be designated in writing by an Authorized
        Person of the Provider. 

       

      (iv) No
        Advance shall cause the aggregate principal balance outstanding on the Loan
        to
        exceed the Maximum Aggregate Loan Amount.

       

      (g)  The
        Provider shall use Advances for the purpose of supporting the Provider’s
        business operations and for any other general business needs.

       

      (h)  (A)As
        a
        condition precedent to the obligation of PHCC to disburse the initial Advance
        under this Agreement, the following shall have been received by PHCC and
        the
        following actions shall have been taken to the satisfaction of
        PHCC:

       

      (i)  the
        Provider Agreements, properly executed on behalf of the Provider; 

       

      (ii)  a
        certificate of an authorized officer, manager or managing member, as the
        case
        may be, of the Provider, certifying as to (i) the resolutions of the Provider’s
        board of directors, general partner(s) or managing member(s), as the case
        may
        be, authorizing the execution, delivery and performance of the Provider
        Agreements and any related documents and (ii) the signatures of each
        Authorized Person authorized to execute and deliver the Provider Agreements
        and
        other instruments, agreements and certificates on behalf of the Provider
        and to
        request Advances;

       

      (iii)  if
        applicable, a Certificate of Good Standing issued as to the Provider by the
        Secretary of the State of the Provider’s state of organization not more than 30
        days prior to the Closing Date;

       

      (iv)  payment
        of Reimbursable Expenses due on the Closing Date, the Initial Commitment
        Fee and
        such other fees, commissions and expenses required to be paid by the Provider
        pursuant to the Provider Agreements as of the Closing Date;

       

      (v)  acknowledgment
        copies of proper financing statements (Form UCC-1) naming the Provider as
        the
        debtor and naming PHCC as the secured party or other similar documents or
        instruments as may be necessary, or in the opinion of PHCC desirable, under
        the
        UCC, as amended from time to time, of all appropriate jurisdictions, or any
        comparable law, to perfect PHCC’s security interest in all Collateral which may
        be pledged by the Provider to PHCC hereunder;

       


      
        
          
          

        

        
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      (vi)  certified
        copies (or copies otherwise satisfactory to PHCC) of Requests for Information
        or
        Copies (Form UCC-11) (or a similar search report certified by a Person
        acceptable to PHCC) listing all effective financing statements (including
        those
        referred to in subsection (v) above) which name the Provider (under its present
        name and any previous name) as debtor or seller and which are filed in the
        jurisdictions in which filings were made pursuant to subsection (v) above,
        together with copies of such financing statements and searches of applicable
        federal and state court and agency dockets and lien records showing all
        judgment, tax and ERISA liens affecting the Provider or the Collateral, none
        of
        which (except those filed pursuant to subsection (v) above) shall cover any
        of
        the Collateral to be pledged by the Provider to PHCC or any related Contracts
        unless the documents referred to in subsection (vii) below cover such financing
        statements;

       

      (vii)  releases
        and acknowledgment copies of proper Termination Statements, if any, necessary
        to
        evidence the release of all security interests, ownership and other rights
        of
        any Person in the Collateral previously granted by the Provider;

       

      (viii)  a
        copy of
        the Servicing Agreement and any Addendums thereto requested by PHCC, duly
        authorized, executed and delivered by the Provider and the Servicer, together
        with evidence satisfactory to PHCC that the Provider has established an account
        at an insured depositary institution into which all payments with respect
        to the
        Healthcare Receivables will be deposited;

       

      (ix)  as
        requested by PHCC from time to time, a copy of all of the Provider’s forms of
        patient consent to be signed by each patient for which a Healthcare Receivable
        is or was created which authorizes the demographic and medical information
        with
        respect to such patient to be disclosed to, and by, the Servicer;

       

      (x)  PHCC
        shall have completed examinations, the results of which shall be satisfactory
        in
        form and substance to PHCC, of the Collateral, the financial statements and
        the
        books, records, business, obligations, financial condition and operational
        state
        of the Provider, and the Provider shall have demonstrated to PHCC’s satisfaction
        that (A) its operations comply, in all respects deemed material by PHCC, in
        its sole reasonable judgment, with all applicable federal, state, foreign
        and
        local laws, statutes and regulations, (B) its operations are not the
        subject of any governmental investigation, evaluation or any remedial action
        which could result in any expenditure or liability deemed material by PHCC,
        in
        its sole judgment, and (C) it has no liability (whether contingent or
        otherwise) that is deemed material by PHCC, in its reasonable sole
        judgment;

       

      (xi)  the
        various mechanisms for creating and perfecting the security interests in
        the
        Collateral are in effect and can be utilized with respect to the
        Collateral;

       


      
        
          
          

        

        
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      (xii)  all
        Collateral in which PHCC has been granted, or may demand, a security interest
        are owned outright by the Provider, are not subject to claim, assignment
        or
        setoff, and are in the physical or constructive possession or control of
        PHCC;

       

      (xiii)  the
        Provider has the unrestricted right to pledge the Collateral as contemplated
        herein; 

       

      (xiv)  such
        other documents, opinions or certificates as PHCC may reasonably request;
        and

       

      (xv)  an
        Availability Certificate and Advance Request in the form of Exhibit E duly
        executed by an Authorized Person.

       

      (B) As
        a
        condition precedent to the continuing obligation of PHCC to make each Advance,
        the following conditions (in addition to those enumerated under Section 2(h)(A)
        hereinabove) shall be satisfied by the Provider:

       

      (i)  all
        representations and warranties of the Provider contained herein and in each
        other Provider Agreement shall be true and complete in all material respects
        (determined for this purpose as if all qualifications to such representations
        and warranties based on knowledge or materiality were omitted) at all times
        during the term of this Agreement;

       

      (ii)  the
        Provider shall have performed and complied in all material respects with
        all
        obligations and agreements and all covenants and conditions contained in
        this
        Agreement and in each other Provider Agreement to which it is a party to
        be
        performed or complied with by it at all times (such performance or compliance
        to
        be determined for this purpose as if all qualifications to such obligations,
        agreements, covenants and conditions based on the use of diligent efforts
        or
        best efforts were omitted) and PHCC shall have received evidence, in form
        and
        substance reasonably satisfactory to it, of such performance and
        compliance;

       

      (iii)  all
        corporate actions necessary to authorize (A) the execution, delivery and
        continuing performance by the Provider of this Agreement and of each other
        Provider Agreement to which it is a party and (B) the consummation of the
        transactions contemplated hereby and thereby shall have been and shall continue
        to be duly and validly taken by the Provider and shall be in full force and
        effect. All such actions and all other actions, proceedings, instruments
        and
        documents required to carry out the transactions contemplated hereby or
        incidental hereto and all other related legal matters shall be reasonably
        satisfactory to and approved by counsel for PHCC and such counsel shall be
        furnished with such certified copies of such corporate actions and proceedings
        and such other instruments and documents as it shall have reasonably requested
        from time to time;

       


      
        
          
          

        

        
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      (iv)  no
        event
        has occurred and is continuing, or would result from such Advance, which
        constitutes an Event of Default; and

       

      (v)  the
        Provider shall provide with each Advance Request an Availability Certificate
        and
        Advance Request in the form of Exhibit E duly executed by an Authorized
        Person.

       

      Each
        Advance Request shall constitute a representation that the above is true
        and
        that the statements set forth in Sections 7 and 8 are correct.

       

      (i)  PHCC’s
        Commitment shall terminate on the Scheduled Maturity Date unless this Agreement
        is terminated prior thereto.

       

      Section
        3.   Servicing
        of Healthcare Receivables.
        Healthcare Receivables will be serviced by the Servicer pursuant to the terms
        and conditions of the Servicing Agreement. Under the terms of the Servicing
        Agreement, the Servicer shall act as the agent of the Provider, shall service
        the Healthcare Receivables in accordance with the directions of the Provider
        and
        shall, as agent of the Provider, disburse proceeds of the Healthcare Receivables
        as directed by the Provider under the Servicing Agreement.

       

      If
        the
        Provider determines, for any reason, to terminate or remove the Servicer,
        the
        Provider may do so only upon not less than thirty (30) days’ prior written
        notice to the Servicer, with a copy of such notice sent to PHCC, along with
        (i) a certified copy of the resolution unanimously adopted by the governing
        body of the Provider authorizing and directing that the Servicer be terminated
        as agent under the Servicing Agreement and (ii) a certificate signed by the
        Provider, evidencing termination of the Servicing Agreement, subject to
        appointment of a successor to the Servicer as provided below (provided, however,
        that the foregoing shall not impede the Provider’s ability to change a return
        address or instructions with respect to Governmental Obligors as contemplated
        by
        Section 4(b) or change an automatic transfer instruction as contemplated
        by
        Section 4(f)). In addition, if the Servicer is in default under the terms
        of the
        Servicing Agreement, PHCC shall have the right to obtain the removal or
        termination of the Servicer for cause and the right to have the Provider
        appoint
        a successor Servicer, subject to the last sentence of this Section. No
        termination or removal of a Servicer, whether by the Provider or at the
        direction of PHCC for cause as provided herein, shall be effective unless,
        prior
        to the date such termination or removal is to be effective, the Provider
        has
        selected a successor Servicer acceptable to PHCC and such successor Servicer
        has
        accepted its appointment by the Provider in writing.

       

      Section
        4.   Post
        Office Box and Provider Lockbox Account For Healthcare
        Receivables.

       

      (a)  On
        or
        prior to the date hereof, Provider, pursuant to the Servicing Agreement,
        shall
        have established in its own name (1) a post office box for the receipt of
        all
        items with respect to Healthcare Receivables (the “Lockbox”), and (2) an account
        at an insured depository institution approved by PHCC for the deposit of
        all
        Collections and payments on the Healthcare Receivables (the “Lockbox Account”)


       


      
        
          
          

        

        
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      The
        Lockbox Account shall be subject at all times to a control agreement in form
        satisfactory to PHCC in PHCC’s reasonable sole discretion (the “Control
        Agreement”), said control agreement to be among PHCC, Provider and the financial
        institution at which the Lockbox Account is established.

       

      (b)  The
        Provider hereby covenants and agrees that, on and after the date hereof,
        all
        claims (including CMS 1500 or related insurance billing forms) to be sent
        to
        Obligors (and return envelopes, if provided by the Provider) shall set forth
        only the address of the Lockbox as a return address for payment of Healthcare
        Receivables and delivery of all EOB/ERAs and only the Lockbox Account as
        the
        account into which wire transfers for Collections and payment on Healthcare
        Receivables shall be deposited. The Provider hereby further covenants and
        agrees
        to instruct and notify each of the members of the Provider’s accounting and
        collections staff, and of the Servicer’s accounting and collection staff, to
        provide identical information in communications with Obligors with respect
        to
        collections, wire transfers and EOB/ERAs on Healthcare Receivables. With
        respect
        to Non-Governmental Obligors, the Provider shall not change such return address
        or the instructions in any Obligor Notice without the express prior written
        consent of PHCC. With respect to Governmental Obligors, Provider remains
        free to
        change such return address and the instructions in any Obligor Notice; provided,
        however, any such change undertaken by Provider without the express written
        permission of PHCC shall constitute a breach of this Agreement.

       

      (c)  Unless
        an
        Event of Default exists or a court order to the contrary is received, the
        Provider will retain the right to receipt of Collections and payment of the
        Healthcare Receivables and all rights to demand or make claims under the
        applicable Governmental program for any Governmental Receivable to the extent
        provided under the Servicing Agreement. The Provider shall remit daily to
        the
        Servicer all amounts which the Provider receives with respect to the Healthcare
        Receivables (whether received in the Lockbox, the Lockbox Account, or otherwise,
        and whether accomplished through the mechanism described in subsection (f)
        below
        or otherwise), and shall notify PHCC and the Servicer of all such amounts,
        including information as to the Healthcare Receivables to which such amounts
        relate and copies of any related EOB/ERAs. Provider hereby instructs the
        Servicer to pay all amounts so received on a daily basis to PHCC. PHCC will
        immediately credit to interest owing hereunder and to any outstanding line
        of
        credit balance all such amounts that were received from account debtors which
        are or were at one time account debtors on Eligible Receivables; provided,
        however, that in no case shall PHCC be required to credit Provider with the
        amount of any check or other instrument constituting provisional payment
        until
        PHCC has received final payment thereof at its office in the form of immediately
        available funds accepted by PHCC. Unless an Event of Default exists, PHCC
        (or
        Servicer on PHCC’s behalf) shall pay to Provider daily (i) all such amounts that
        were received from account debtors which are not and were never account debtors
        on Eligible Receivables, and (ii) any such amounts received on a day when
        the
        outstanding principal and interest balance on Provider’s line of credit under
        this Agreement is zero or less than zero.

       


      
        
          
          

        

        
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      (d)  If
        an
        Obligor makes a payment on a Healthcare Receivable other than to the Lockbox
        or
        the Lockbox Account, with respect to wire transfers the Provider shall promptly
        give written notice thereof to PHCC and the Provider shall take all necessary
        steps to effect the collection of such payment from any other Person claiming
        an
        interest therein or having possession thereof and deliver such to the Servicer
        together with all necessary endorsements. If the Provider itself shall receive
        any amounts with respect to a Healthcare Receivable (other than receipts
        into
        the Lockbox or the Lockbox Account, which receipts are addressed elsewhere
        in
        this Agreement), the Provider shall so notify PHCC and the Servicer immediately
        and shall hold all checks and instruments received in trust for PHCC and
        shall
        deliver to Servicer such checks and other instruments duly endorsed to PHCC
        (or,
        at the direction of PHCC, the proceeds thereof) without delay or setoff,
        including information as to the Healthcare Receivable to which such amounts
        relate and copies of any related EOB/ERAs. The Provider shall cooperate with
        PHCC and the Servicer in the identification of items deposited in the Lockbox
        or
        the Lockbox Account.

       

      (e)  All
        deliveries and notifications referred to in this Section 4 shall be made
        promptly upon the Provider’s receipt of any such amount or information and
        delivery to PHCC and the Servicer thereof shall be no later than midnight
        Central Time within three (3) days of receipt by the Provider (except with
        respect to delivery of tangible items, which shall be no later than 5:00
        pm CST
        on the business day after receipt by the provider).

       

      (f)  Pursuant
        to the Servicing Agreement, the Provider shall instruct the financial
        institution holding the Lockbox and the Lockbox Account to transfer, or cause
        to
        be transferred, to the account described in the Servicing Agreement,
        automatically, at the end of each Business Day, all amounts on deposit in
        the
        Lockbox Account. No Person, other than the Provider, shall have the right
        to
        change or cancel the foregoing automatic transfer instruction; provided,
        however, that the Provider shall not make such change or cancellation other
        than
        pursuant to the Servicing Agreement and as provided in the Addendum to the
        Servicing Agreement.

       

      Section
        5.   Security
        Interest.

       

      (a)  This
        Agreement is intended to constitute a security agreement within the meaning
        of
        the UCC. As security for the Obligations, the Provider hereby assigns, pledges
        and grants to PHCC a first priority continuing security interest in all right,
        title and interest of the Provider in, to and under all of the following,
        whether now or hereafter owned, existing, created, arising or acquired
        (collectively, the “Collateral”): 

       


      
        
          
          

        

        
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      (i)  Healthcare
        Receivables, all related Contracts and all Collections with regard thereto,
        any
        and all amounts now or hereafter due to the Provider from the Lockbox, the
        Lockbox Account, all funds on deposit in each of the foregoing with regard
        thereto and all certificates and instruments, if any, from time to time
        evidencing the Lockbox and the Lockbox Account and such funds of the Provider
        on
        deposit therein, all claims thereunder or in connection therewith, all software
        and books and records relating to any of the foregoing, all general intangibles,
        accounts, payment intangibles, interest, dividends, moneys, instruments,
        securities and other property from time to time received, receivable or
        otherwise distributed in respect of or in exchange for any or all of the
        foregoing, and all proceeds and amounts received or receivable under any
        or all
        of the foregoing;

       

      (ii)  substitutions,
        accessions, additions, parts, accessories, attachments, replacements, Proceeds
        and products of, for and to any and all of the foregoing, including, without
        limitation, any and all insurance proceeds, and any and all such substitutions,
        accessions, additions, parts, accessories, attachments, replacements, Proceeds
        and products in the form of any of the property described or referenced in
        (i)
        above.

       

      All
        references in this Agreement to the UCC shall mean the Georgia Uniform
        Commercial Code (the “UCC”), as amended from time to time. All references in
        this Section 5 to general intangibles, accounts and payment intangibles shall
        mean those terms as defined in the UCC.

       

      


       

      Upon
        an
        Event of Default under this Agreement, to the fullest extent permitted by
        applicable law, PHCC’s rights with respect to the Collateral pledged hereunder
        include, but are not limited to, the right to: (i) settle and/or compromise
        any
        or all of such Collateral; (ii); and (iii)demand, receive and sue, in the
        Provider’s name at PHCC’s option, for any moneys due or which may become due
        under such Collateral, or for enforcement of any rights afforded the Provider
        with respect thereto. 

       

      Notwithstanding
        the foregoing provision, to the fullest extent permitted by applicable law,
        at
        any time PHCC’s rights with respect to the Collateral pledged hereunder include,
        but are not limited to, the right to: (i) do all acts necessary or advisable
        in
        furtherance of any rights of PHCC hereunder and 

       


      
        
          
          

        

        
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      (ii)
        sign
        and endorse on behalf of the Provider all checks and instruments received
        in
        connection with Collections on the Healthcare Receivables and the Provider
        hereby irrevocably appoints PHCC the attorney-in-fact of the Provider for
        such
        purpose; and the Provider hereby specifically authorizes, ratifies and confirms
        all that PHCC shall do by virtue hereof; provided, however, that notwithstanding
        anything to the contrary in this Agreement, the Provider, and not PHCC, shall
        retain, unless otherwise specified in a court order or an agreement of agency,
        all rights of collection and endorsement with respect to Governmental
        Receivables. 

       

      The
        Provider specifically agrees to execute and/or prepare, and file or publish,
        all
        at the request and direction of PHCC, and at the Provider’s expense, any and all
        documentation and/or notices of PHCC’s rights herein as may be necessary or
        advisable, in PHCC’s discretion, to effect the terms hereof or protect PHCC’s
        interest herein described. In no event shall PHCC be responsible, in whole
        or in
        part, for any duties, performance or obligations of the Provider with respect
        to
        the Collateral nor shall the Provider be relieved thereof by reason of this
        Agreement.

       

      (b)  This
        Agreement secures the payment and performance by the Provider of all
        indebtedness, liabilities and obligations now existing or hereafter created
        or
        arising under the Note and all renewals, extensions, restructurings and
        refinancings thereof and all other amounts owing under the Provider Agreements,
        including, without limitation, any additional indebtedness which may be extended
        to the Provider pursuant to any restructuring or refinancing of the Provider’s
        indebtedness thereunder, and including any post-petition interest accruing
        during any bankruptcy, reorganization or other similar proceeding (collectively,
        the “Obligations”).

       

      (c)  It
        is the
        intent of the parties hereto that the pledge of Collateral and any action
        taken
        with respect thereto pursuant to this Agreement shall be in a form and manner
        sufficient to create a first priority perfected security interest therein
        for
        the benefit of PHCC. If, at any time, PHCC’s counsel determines that the
        procedures necessary to create or perfect such security interest should be
        modified to enable PHCC’s counsel to deliver an opinion that PHCC’s security
        interest in the Collateral is a first priority perfected security interest,
        such
        procedures shall be modified to enable such opinion to be
        delivered.

       

      (d)  The
        Provider hereby authorizes PHCC to file financing statements, continuation
        statements, and amendments thereto, naming the Provider as debtor and
        describing, as collateral therein, all Collateral pledged by the Provider
        pursuant to this Agreement, including specific lists, sublists and types
        of
        collateral, and which contain any other information required or permitted
        by the
        Uniform Commercial Code, as in effect from time to time in any relevant
        jurisdiction.

       


      
        
          
          

        

        
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      Section
        6.   Representations
        and Warranties of the Provider.
        The
        Provider represents and warrants to PHCC that, as of the date hereof, and
        shall
        be deemed to represent and warrant to PHCC as of each Advance Request, as
        follows:

       

      (a)  if
        a
        corporation, limited liability company, or partnership, the Provider has
        been
        duly organized and is validly existing and in good standing as a corporation,
        limited liability company or partnership, as the case may be, under the laws
        of
        the jurisdiction of its organization and is duly qualified to conduct business
        in each State in which it conducts business;

       

      (b)  the
        Provider has full power and authority to own or lease its properties and
        to
        conduct its business as presently conducted and to execute, deliver and perform
        the Provider Agreements to which it is a party and to consummate the
        transactions contemplated hereby and thereby;

       

      (c)  the
        execution, delivery and performance by the Provider of the Provider Agreements
        and all other instruments and documents to be delivered hereunder and the
        consummation of the transactions contemplated hereby are within the Provider’s
        powers, have been duly and validly authorized by all requisite action and
        will
        not conflict with or result in a breach of any of the terms or provisions
        of, or
        constitute a default under, or result in the creation or imposition of any
        lien,
        charge or encumbrances upon any of its property or assets pursuant to the
        terms
        of, any indenture, mortgage, deed or trust, loan agreement or other agreement
        or
        instrument by which it is bound or to which any of its property or assets
        is
        subject (except the Provider Agreements) nor will such action result in any
        violation of the provisions of its organizational documents (including its
        articles of incorporation and bylaws, operating agreement or partnership
        agreement, as the case may be) or of any statute or any order, rule or
        regulation of any court or governmental agency or body of the
        United States, any state or any political subdivision of either having
        jurisdiction over it or any of its properties or assets, and no consent,
        approval, authorization, order, registration, filing, qualification, license
        or
        permit of or with any such court or any such regulatory authority or other
        such
        governmental agency or body is required to be obtained by or with respect
        to the
        Provider in connection with the execution, delivery and performance by the
        Provider of the Provider Agreements, all other instruments and documents
        to be
        delivered thereunder and the consummation of the transactions contemplated
        thereby, and no transaction contemplated thereby requires compliance with
        any
        bulk sales act or similar law;

       

      (d)  no
        authorization or approval or other action by, and no notice to or filing
        with,
        any governmental authority or regulatory body or other Person is required
        for
        the due execution, delivery and performance by the Provider of the Provider
        Agreements except for the filing of financing statements under the UCC or
        the
        Uniform Commercial Code in effect in any relevant jurisdiction and the giving
        of
        notices referred to in Section 2(h)(A), all of which, at the time required
        in Section 2(h)(A) shall have been duly made and shall be in full force and
        effect;

       


      
        
          
          

        

        
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      (e)  each
        of
        the Provider Agreements has been duly and validly authorized, executed and
        delivered by the Provider and constitutes a valid and legally binding obligation
        of the Provider, enforceable against the Provider in accordance with its
        terms,
        subject to applicable bankruptcy, reorganization, insolvency, moratorium
        or
        other similar laws affecting the enforcement of creditors’ rights generally and
        subject as to enforceability to general principles of equity (regardless
        of
        whether enforcement is sought in a proceeding in equity or at law);

       

      (f)  there
        are
        no actions, suits, proceedings or investigations pending or, to the knowledge
        of
        the Provider, threatened, before any court, administrative agency, arbitrator,
        governmental body or other tribunal, (i) which, if determined adversely to
        the Provider, could have a material adverse effect on the business, operations,
        properties, assets or financial condition of the Provider, (ii) asserting
        the invalidity of any of the Provider Agreements, (iii) questioning the
        consummation by the Provider of any of the transactions contemplated by any
        of
        the Provider Agreements or (iv) which, if determined adversely, could
        materially and adversely affect the ability of the Provider to perform its
        obligations under, or the validity or enforceability of any of the Provider
        Agreements, Contracts or the Healthcare Receivables;

       

      (g)  the
        Provider has all necessary permits, licenses, agreements, accreditation,
        certifications and Governmental Consents to operate and conduct its business,
        including the provision of all services reflected in and giving rise to each
        Healthcare Receivable, as it is presently being conducted, subject to minor
        exceptions and deficiencies which are not material and do not affect the
        conduct
        of its business and its ability to own, collect and grant a security interest
        in
        the Collateral;

       

      (h)  Exhibit
        C
        lists (i) the Provider’s exact legal name, (ii) the Provider’s address for
        notices, (iii) the address of the chief executive office of the Provider,
        (iv)
        the Provider’s State of organization, (v) the location of the office where the
        Provider keeps all of the tangible Collateral and Records related thereto
        and to
        all of the intangible Collateral and (vi) the location, account number and
        account officer responsible for the Provider’s demand account;

       

      (i)  Except
        as
        occurs within the normal course of business, each Contract of the Provider
        is in
        full force and effect and has not been amended or otherwise modified, rescinded
        or revoked or assigned, the Provider is in compliance with the material
        requirements of the Contracts and no condition exists or event has occurred
        which, in itself or with the giving of notice or lapse of time or both, would
        result in the suspension, revocation, impairment, forfeiture or nonrenewal
        of
        any Governmental Consent applicable to the Provider or any other health care
        facility owned or operated by the Provider or such facility’s participation in
        the Governmental Programs and there is no claim that any such Contract or
        Governmental Consent is not in full force and effect;

       


      
        
          
          

        

        
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      (j)  there
        has
        been filed in proper form, or a filing extension from the appropriate
        governmental authority has been obtained with respect to, all federal, state,
        and local income, franchise, sales, use, property, excise, payroll and other
        tax
        returns and all other reports (whether or not relating to taxes) required
        by law
        to be filed by or on behalf of the Provider with any governmental authority.
        All
        taxes, fees, assessments and charges of whatsoever nature due or payable
        by the
        Provider on or before the date hereof pursuant to said returns or reports
        or
        otherwise (including, without limitation, payments of estimated taxes and
        deposits of taxes withheld by or on behalf of the Provider) have been paid.
        There is no unpaid interest, penalty or addition to tax due or claimed to
        be due
        from, nor any unpaid tax deficiency determination or assessment outstanding
        against the Provider, nor any basis therefore known to the Provider. No
        governmental audits or investigations with respect to taxes are, to the
        Provider’s knowledge, in progress with respect to the Provider, and no
        governmental authority has given notice that it will begin any such audit
        or
        investigation. All returns and reports required to be filed, and all taxes,
        fees, assessments and charges required to be paid, of whatsoever nature,
        have
        been so filed and paid. The Provider has complied in all material respects
        with
        all applicable laws relating to the employment of labor, including, without
        limitation, ERISA and those relating to wages, hours, collective bargaining,
        unemployment insurance, workers’ compensation, equal employment opportunity and
        the payment and withholding of taxes, including income and social security
        taxes, and has withheld (and duly segregated, deposited or paid over to the
        appropriate authorities) all amounts required by law or agreement to be withheld
        from the wages or salaries of its employees and is not liable for any arrears
        of
        wages or benefits or any taxes or penalties for the Provider’s failure to comply
        with any of the foregoing;

       

      (k)  the
        Medicare and Medicaid cost reports of each facility and of the home office
        of
        the Provider for all cost reporting periods ending on or before the date
        hereof
        have been filed with the appropriate governmental entity, if due, there are
        no
        pending or threatened Notice of Program Reimbursements outstanding, and
        all
        prior years’ cost reports have been examined and audited by (i) as to Medicaid,
        the applicable state agency or other CMS-designated agents or agents of such
        state agency charged with such responsibility or (ii) as to Medicare, the
        Medicare intermediary or other CMS-designated agents charged with such
        responsibility, and have been settled and there are no offsets pending,
        threatened or now owed by the Provider;

       

      (l)  the
        Provider has valid provider identification numbers and licenses to generate
        valid Healthcare Receivables payable by Eligible Obligors;

       

      (m)  the
        information furnished by or on behalf of the Provider to PHCC and to agents
        and
        employees of PHCC prior to the date of this Agreement and during the term
        of
        this Agreement or in connection with any transaction contemplated by the
        Provider Agreements is and will be true and correct in all material respects
        and
        does not and will not omit to state a material fact necessary to make the
        statements contained therein not misleading;

       


      
        
          
          

        

        
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      (n)  the
        Provider is solvent and will not become insolvent after giving effect to
        the
        transactions contemplated by the Provider Agreements; the Provider has not
        incurred debts or liabilities beyond its ability to pay; the Provider will,
        after giving effect to the transactions contemplated by the Provider Agreements,
        have an adequate amount of capital to conduct its business in the foreseeable
        future; and the pledge of the Collateral hereunder is made in good faith
        and
        without intent to hinder, delay or defraud present or future creditors of
        the
        Provider;

       

      (o)  the
        Lockbox Account established by the Provider is the only lockbox account into
        which the Healthcare Receivables are or will be deposited;

       

      (p)  the
        exact
        legal name of the Provider is as set forth in Exhibit C to this Agreement.
        Except as set forth in Exhibit C to this Agreement, the Provider has not
        changed
        its name in the last six years and, during such period, the Provider did
        not use, and the Provider does not now use, any trade names, fictitious names,
        assumed names or “doing business as” names;

       

      (q)  each
        pension plan or profit sharing plan to which the Provider is a party has
        been
        fully funded in accordance with the obligations of the Provider set forth
        in
        such plan;

       

      (r)  the
        Healthcare Receivables have been, and will continue to be, adjusted to reflect
        reimbursement policies of the Obligors with respect thereto and the amount
        thereof will not exceed amounts the Provider is entitled to receive under
        any
        capitation arrangement, fee schedule, discount formula, cost-based reimbursement
        or other adjustment or limitation to the usual charges of the
        Provider;

       

      (s)  Except
        within the normal course of business, the Provider is not a party to any
        unresolved disputes with any Obligor on a Healthcare Receivable, without
        regard
        to whether the dispute with an Obligor involves a Healthcare Receivable of
        the
        Provider which is pledged to PHCC under this Agreement, except as disclosed
        in
        writing to PHCC;

       

      (t)  there
        are
        no pending civil or criminal investigations involving the Provider or its
        officers and directors and neither the Provider nor any of its officers or
        directors has been involved in, or the subject of, any civil or criminal
        investigation within the past five years;

       

      (u)  the
        Provider has executed and delivered to each Obligor a notice showing the
        Lockbox
        and Lockbox Account as the only address to which Healthcare Receivable payments
        and information are to be remitted and has provided a copy of each such notice
        to PHCC;

       


      
        
          
          

        

        
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      (v)  other
        than, with respect to Governmental Receivables, pursuant to the terms of
        the CMS
        in the rules and regulations governing the prospective payment system for
        healthcare providers or similar governmental programs or regulations, neither
        the federal government nor any other Person has asserted any claim or right
        to
        offset any liability or debt against any Governmental Receivable. Other than,
        with respect to Governmental Receivables, pursuant to the terms of the CMS
        in
        the rules and regulations governing the prospective payment system for
        healthcare providers or similar governmental programs or regulations, the
        Provider has no overdue or delinquent liabilities or debt which could give
        rise
        to a right of the federal government, any state government or any other Person
        to offset such liabilities or debt against Governmental
        Receivables;

       

      (w)  the
        Provider has heretofore delivered to PHCC true and complete copies of the
        financial statements each of which fairly presents the financial position
        of the
        Provider as of the date thereof and the results of operations and changes
        in
        financial condition of the Provider for the period then ended and has been
        prepared in accordance with generally accepted accounting principles
        consistently applied.  The
        books
        of account and records of the Provider are true and complete in all material
        respects and fairly reflect all the material properties, assets, liabilities
        and
        transactions of the Provider in accordance with generally accepted accounting
        principles consistently applied. All fees, charges, costs and expenses of
        any
        nature whatsoever associated with the ownership, operation and management
        of the
        business and the assets have been in all material respects fully and properly
        charged and reflected in the books and records of the Provider and in the
        Provider’s financial statements, and such books and records and financial
        statements do not, because of the provision of services or the bearing of
        costs
        and expenses by any other person or for any other reason, understate in any
        material respect the true costs and expenses of conducting the Provider’s
        business; and

       

      (x)  all
        documents which have been or shall be delivered to PHCC or filed with any
        governmental authority by or on behalf of the Provider pursuant to this
        Agreement or any other Provider Agreement or in connection with the transactions
        contemplated hereby are, or when so delivered or filed shall be, correct
        and
        complete in all material respects and, if applicable, in full force and
        effect.

       

      Section
        7.   Representations
        and Warranties Concerning Healthcare Receivables Pledged to
        PHCC.
        The
        Provider represents and warrants to PHCC, as of the date hereof, and shall
        be
        deemed to represent and warrant to PHCC as of each Advance Request, as follows
        with respect to each Healthcare Receivable pledged to PHCC
        hereunder:

       

      (a)  the
        Net
        Value of such Healthcare Receivable is payable in full by an Eligible
        Obligor;

       


      
        
          
          

        

        
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      (b)  the
        Provider has submitted all necessary documentation and supplied all necessary
        information for payment of such Healthcare Receivable to the Obligor thereof
        (including, but not limited to, the COMN with respect to a DME Receivable)
        and
        has fulfilled all of its other obligations in respect thereof, including
        verification of the eligibility of the Healthcare Receivable for payment
        by such
        Obligor;

       

      (c)  the
        Net
        Value of such Healthcare Receivable is net of contractual allowances or other
        modifications;

       

      (d)  such
        Healthcare Receivable has not been paid in whole or in part;

       

      (e)  neither
        such Healthcare Receivable nor any related Contract has been compromised,
        adjusted, extended, satisfied, subordinated, rescinded, set off or modified
        by
        the Provider and is not subject to compromise, adjustment, extension,
        satisfaction, subordination, rescission, setoff, counterclaim, defense or
        modification, whether arising out of transactions concerning the Contract
        or
        otherwise;

       

      (f)  true
        and
        correct copies of all claims, agreements and other documents relating to
        the
        creation of such Healthcare Receivable have been delivered to PHCC or the
        Servicer;

       

      (g)  such
        Healthcare Receivable is owned by the Provider free and clear of any claim
        of
        ownership of any other Person and is not subject to any sale, lien, security
        interest, financing statement or other charge or encumbrance or other type
        of
        preferential arrangement having the effect of a lien or security interest,
        in
        favor of any Person other than as contemplated by this Agreement;

       

      (h)  no
        action, other than the execution and delivery of this Agreement, the filing
        of
        financing statements in the state where the Provider is “located” pursuant to
        the Uniform Commercial Code of the relevant jurisdiction, as amended from
        time
        to time, is required to perfect the interest of PHCC, as a secured party
        of and
        to such Healthcare Receivable, and all such actions have been or will be
        accomplished no later than the date of execution of this Agreement;

       

      (i)  such
        Healthcare Receivable complies with all material laws and regulations applicable
        thereto;

       

      (j)  such
        Healthcare Receivable is in full force and effect and represents and constitutes
        a legal, valid and binding obligation of the related Obligor enforceable
        against
        such Obligor in accordance with its terms and constitutes an “Account” under the
        Uniform Commercial Code in effect in any jurisdiction deemed to govern the
        creation, perfection, and effect of perfection or non-perfection of a security
        interest therein, as amended from time to time;

       


      
        
          
          

        

        
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      (k)  such
        Healthcare Receivable does not constitute or has not constituted an obligation
        of any subsidiary, parent or other Person which is an affiliate of the
        Provider;

       

      (l)  such
        Healthcare Receivable (i) is payable, in an amount equal to not less than
        its
        Net Value, by the Eligible Obligor identified by the Provider as being obligated
        to do so, and is recognized as such by the applicable Eligible Obligor (except
        to the extent limited for Governmental Receivables pursuant to the terms
        of the
        CMS in the rules and regulations governing the prospective payment system
        for
        healthcare providers or similar governmental programs or regulations), (ii)
        is
        based on an actual and bona fide rendition of services to, or the furnishing
        of
        goods or medical equipment provided to, a patient by the Provider in the
        ordinary course of its business, (iii) is denominated and payable only in
        lawful
        currency of the United States and (iv) is an account and is not evidenced
        by
“negotiable documents,” “instruments” or “tangible chattel paper” within the
        meaning of the Uniform Commercial Code of any relevant
        jurisdiction;

       

      (m)  other
        than, with respect to Governmental Receivables, pursuant to the terms of
        the CMS
        in the rules and regulations governing the prospective payment system for
        healthcare providers or similar governmental programs or regulations, such
        Healthcare Receivable (i) is not subject to any setoff, counterclaim, defense,
        abatement, suspension, deferment, deductible, reduction or termination by
        its
        Obligor and (ii) is not past, or less than 150 days prior to, the statutory
        limit for collection applicable to its Obligor;

       

      (n)  the
        goods
        and services provided and reflected in such Healthcare Receivable, or the
        medical equipment provided, were medically necessary, and the patient has
        received such goods, services or medical equipment;

       

      (o)  the
        fees
        charged for the services or goods constituting the basis for such Healthcare
        Receivable were the usual, customary and reasonable fees charged by other
        medical service providers in the Provider’s community for the same or similar
        services or goods or, if the fees for services or goods were subject to
        limitations imposed by contracts for reimbursement from the related Obligor,
        such fees did not exceed the limitations so imposed, and such Healthcare
        Receivable for which the fees are so restricted has been clearly identified
        to
        PHCC as being subject to such restriction;

       

      (p)  the
        Provider has identified and provided to the Servicer all Records, including
        all
        documents, contracts and other information necessary to identify each Obligor
        liable on such Healthcare Receivable, whether primarily, secondarily or
        otherwise, and the only Obligor(s) liable on such Healthcare Receivable is
        (are)
        the Obligor(s) identified in the applicable Records;

       


      
        
          
          

        

        
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      (q)  other
        than as may be limited with respect to Governmental Receivables pursuant
        to the
        CMS in the rules and regulations governing the prospective payment system
        for
        healthcare providers or similar governmental programs or regulations, the
        Provider has the right to pledge such Healthcare Receivable pursuant to this
        Agreement, no consent from the related Obligor or any other Person is required
        to effect the pledge of such Healthcare Receivable to PHCC and this Agreement,
        and such pledge of such Healthcare Receivable will constitute a valid security
        interest in such Healthcare Receivable in favor of PHCC enforceable against
        the
        Provider and all creditors of and purchasers from the Provider;

       

      (r)  other
        than, for Governmental Receivables, pursuant to the CMS in the rules and
        regulations governing the prospective payment system for healthcare providers
        or
        similar governmental programs or regulations, the Provider has made all payments
        to any Obligor necessary to prevent the Obligor from offsetting an earlier
        overpayment to the Provider against any amount the Obligor owes on such
        Healthcare Receivable;

       

      (s)  there
        are
        no procedures or investigations pending or threatened before any Governmental
        authority (i) asserting the invalidity of such Healthcare Receivable or any
        Contract related thereto, (ii) relating to the bankruptcy or insolvency of
        the
        related Obligor, (iii) seeking the payment of such Healthcare Receivable
        or
        payment and performance of such Contract or (iv) seeking any determination
        or
        ruling that might materially and adversely affect the validity or enforceability
        of such Healthcare Receivable or any Contract related thereto;

       

      (t)  neither
        such Healthcare Receivable nor Contract related thereto contravenes in any
        material respect any federal, state or local laws, rules or regulations
        applicable thereto (including, without limitation, the rules and regulations
        of
        CMS and laws, rules and regulations relating to usury, consumer protection,
        truth in lending, fair credit billing, fair credit reporting, equal credit
        opportunity, fair debt collection practices and privacy), and no party to
        such
        related Contract is in violation of any such law, rule or regulation in any
        material respect;

       

      (u)  the
        insurance policy or Contract obligating an Obligor to make payment (i) does
        not
        prohibit the transfer of the right to receive payment from the patient to
        the
        Provider and (ii) was in full force and effect and applicable to the patient
        at
        the time the services constituting the basis for such Healthcare Receivable
        were
        performed; and

       

      (v)  such
        Healthcare Receivable complies with such additional criteria and requirements
        as
        PHCC may from time to time specify to Provider other than as such criteria
        and
        requirements may be limited with respect to Governmental Receivables pursuant
        to
        the CMS in the rules and regulations governing the prospective payment system
        for healthcare providers or similar governmental programs or
        regulations.

       


      
        
          
          

        

        
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      Section
        8.   Covenants
        of the Provider.
        The
        Provider hereby agrees with and covenants to PHCC and its successors and
        assigns
        that during the term of this Agreement:

       

      (a)  if
        the
        Provider is a corporation, limited liability company or partnership, the
        Provider shall preserve and maintain its existence in good standing under
        the
        laws of the state of its organization and qualify and remain qualified in
        good
        standing as a foreign entity in each jurisdiction where the failure to preserve
        and maintain such existence, rights, franchises, privileges and qualification
        would materially adversely affect the interests of PHCC hereunder or in the
        Collateral, or the ability of PHCC or the Servicer to perform its respective
        obligations hereunder;

       

      (b)  the
        Provider shall do nothing to impair PHCC’s right in any Collateral or impede or
        interfere with the collection by PHCC or any of its agents of any Healthcare
        Receivable, or compromise, adjust, extend, satisfy, subordinate, rescind,
        set
        off or modify or otherwise permit or agree to any deviation from the terms
        or
        conditions of any Healthcare Receivable;

       

      (c)  the
        Provider shall comply, in all material respects, with its obligations under
        the
        Contracts relating to Healthcare Receivables, and with all material laws,
        acts,
        rules, regulations, orders, decrees and directions of any federal, state
        or
        local governmental authority (including, without limitation, the Social Security
        Act and the rules and regulations promulgated thereunder and the applicable
        State and federal Medicaid laws and rules and regulations promulgated thereunder
        and in accordance therewith) applicable to the Healthcare Receivables or
        any
        part thereof or any related Contracts and with respect to the Provider and
        its
        business and properties; provided, however, that the Provider may contest
        any
        act, law, rule, regulation, order, decree or direction in any reasonable
        manner
        which shall not, in the judgment of PHCC, materially and adversely affect
        the
        rights of PHCC in the Collateral;

       

      (d)  the
        Provider shall not create, permit or suffer to exist, and shall defend PHCC’s
        rights to and interest in the Collateral against, and take such other actions
        as
        are necessary to remove, any lien, claim or right in, to or on the Collateral,
        not contemplated or permitted hereunder, and shall defend the right, title
        and
        interest of PHCC in and to the Collateral against the claims and demands
        of all
        Persons whomsoever;

       

      (e)  the
        Provider shall keep its books and accounts in accordance with generally accepted
        accounting principles and shall make a notation on its computer files and
        other
        physical books and records to indicate which of its Healthcare Receivables
        have
        been pledged to PHCC. 

       


      
        
          
          

        

        
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      The
        Provider also shall maintain and implement administrative and operating
        procedures (including, without limitation, an ability to recreate Records
        evidencing the Collateral in the event of the destruction of the originals
        thereof), and keep and maintain all documents, books, records and other
        information reasonably necessary or advisable for collecting all Healthcare
        Receivables (including, without limitation, Records adequate to permit the
        daily
        identification of each Healthcare Receivable and all Collections of and
        adjustments to each existing Healthcare Receivable) and for providing the
        Healthcare Receivables files;

       

      (f)  the
        Provider shall advise PHCC immediately (and in no event later than three
        (3)
        Business Days following actual knowledge thereof), in reasonable detail,
        (i) of any lien asserted or claim made against any of the Collateral
        pledged to PHCC and (ii) of the occurrence of any other event which is a
        Material Adverse Event or reasonably could result in a Material Adverse
        Change;

       

      (g)  PHCC
        and
        its representatives shall at all times have full and free access during normal
        business hours to all the books, correspondence and records of the Provider
        and
        PHCC and its representatives may examine the same, take extracts therefrom
        and
        make photocopies thereof, and the Provider agrees to render to PHCC or its
        representatives, at the Provider’s cost and expense, such clerical and other
        assistance as may be reasonably requested with regard thereto; provided,
        however, that PHCC acknowledges that, in exercising the rights and privileges
        conferred in this Section 9, it or its representatives may, from time to
        time, obtain knowledge of information, practices, books, correspondence and
        records of a confidential nature and in which the Provider has a proprietary
        interest. PHCC agrees (and shall obtain a similar agreement from each of
        its
        representatives) that all such information, practices, books, correspondence
        and
        records are to be regarded as confidential information and that such information
        may be subject to laws, rules and regulations regarding patient confidentiality
        and agrees that (i) it shall retain in strict confidence and shall use its
        best
        efforts to ensure that its representatives retain in strict confidence and
        will
        not disclose without the prior written consent of the Provider any or all
        of
        such information, practices, books, correspondence and records furnished
        to them
        and (ii) that it will not, and will use its best efforts to ensure that its
        representatives will not, make any use whatsoever (other than for the purposes
        contemplated by this Agreement) of any of such information, practices, books,
        correspondence and records without the prior written consent of the Provider,
        unless such information is generally available to the public or is required
        by
        law to be disclosed. The Provider shall, from time to time during regular
        business hours, permit PHCC, or its agents or representatives, upon PHCC's
        request, to discuss matters relating to the Collateral or the Provider’s
        performance hereunder with any of the officers or employees of the Provider
        having knowledge of such matters. Unless an Event of Default under this
        Agreement has occurred , PHCC will provide three (3) days advance notice
        to
        Provider prior to exercising its right of access as set forth in this
        paragraph.

       


      
        
          
          

        

        
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      (h)  the
        Provider shall from time to time, at the Provider's expense, promptly execute
        and deliver all further instruments and documents, and take all further action
        that PHCC may reasonably request in order to perfect, protect or more fully
        evidence the pledge of the Collateral. Without limiting the generality of
        the
        foregoing, the Provider shall, at the Provider's expense, and upon the written
        request of PHCC, execute and file such financing or continuation statements,
        or
        amendments thereto or assignments thereof, and such other instruments or
        notices, as may be, in the reasonable opinion of PHCC, necessary or appropriate.
        The Provider hereby authorizes PHCC, without notice to the Provider, and
        at the
        Provider’s expense, to file one or more financing or continuation statements,
        and amendments thereto and assignments thereof, relative to all or any of
        the
        Collateral pledged to PHCC now existing or hereafter arising without the
        signature of the Provider where permitted by law;

       

      (i)  the
        Provider shall not: (i) without providing ten (10) days’ prior written notice to
        PHCC and without filing such amendments to any previously filed financing
        statements as PHCC may require, change the location of its chief executive
        office or the location of the offices where the records relating to the
        Healthcare Receivables are kept or (ii) without providing thirty (30) days’
prior written notice to PHCC and without filing such amendments to any
        previously filed financing statements as PHCC may require, change its name,
        identity or corporate structure in any manner which would, could or might
        make
        any financing statement or continuation statement filed by the Provider in
        accordance with this Agreement seriously misleading within the meaning of
        Section 9-506 of the UCC, as amended from time to time;

       

      (j)  except
        as
        otherwise mandated with respect to Governmental Receivables pursuant to the
        terms of the CMS in the rules and regulations governing the prospective payment
        system for healthcare providers or similar governmental programs or regulations,
        the Provider shall make all payments to an Obligor necessary to prevent such
        Obligor from offsetting an earlier overpayment to the Provider against any
        amount which such Obligor owes with respect to a Healthcare Receivable, and
        the
        Provider shall immediately notify PHCC in the event of any action, proceeding,
        dispute, offset, deduction, defense or counterclaim that is or may be asserted
        by an Obligor relating to a Healthcare Receivable, and the Provider shall
        take
        such action as is reasonably requested by PHCC to defend against such action,
        proceeding, dispute, offset, deduction, defense or counterclaim, and shall
        do so
        within the time period prescribed by applicable law or under an applicable
        contract, or if a time period is not prescribed by law or under a Contract,
        within a reasonable time, and if in PHCC’s judgment, the Provider is not or may
        not initiate such defense in a timely manner, the Provider hereby appoints
        PHCC
        as its attorney-in-fact to initiate and proceed with such defense on the
        Provider’s behalf, subject to, and to the extent permitted by, applicable law.


       


      
        
          
          

        

        
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      (k)  the
        Provider and its agents and representatives hereby irrevocably constitute
        and
        designate PHCC as the Provider’s attorney-in-fact, which irrevocable power of
        attorney is coupled with an interest: (i) to endorse or sign the Provider’s name
        to financing statements, remittances, invoices, assignments, checks (other
        than
        checks from Governmental Obligors), drafts or other instruments or documents
        in
        respect of the Healthcare Receivables, (ii) to notify Obligors to send payments
        on the Healthcare Receivables directly to the Lockbox or Lockbox
        Account, and
        (iii)
        upon an Event of Default under this Agreement, to bring suit in the Provider’s
        name and to settle or compromise such Healthcare Receivables (other than
        Governmental Receivables) as PHCC may, in its reasonable sole discretion,
        deem
        appropriate;

       

      (l)  the
        Provider shall not take any action to cause any Healthcare Receivable to
        be
        evidenced by a/an “negotiable document,” “instrument” or “tangible chattel
        paper” (each as defined in the UCC), except to the extent that (i) causing a
        Healthcare Receivable to be evidenced by such negotiable document, instrument
        or
        tangible chattel paper is required for the collection of such Healthcare
        Receivable or for the enforcement of any rights therein and (ii) the original
        copy of such negotiable document, instrument or tangible chattel paper has
        been
        delivered to PHCC for purposes of effecting a first-priority, perfected security
        interest therein;

       

      (m)  the
        Provider shall pay any taxes relating to the pledge and creation of the security
        interest in the Collateral in favor of PHCC;

       

      (n)  the
        Provider shall, at its expense, timely and fully perform and comply with
        all
        material provisions, covenants and other promises required to be observed
        by it
        under any Contracts related to the Healthcare Receivables;

       

      (o)  the
        Provider shall not, without the prior written consent of PHCC:

       

      (i)  except
        as
        otherwise provided herein, sell, assign (by operation of law or otherwise)
        or
        otherwise dispose of, or create or suffer to exist any adverse claim upon
        or
        with respect to, any Collateral (including a claim of CMS or any other Person
        with respect to a claim or offset against Governmental Receivables or a claim
        of
        the State Medicaid agency with respect to a claim or offset against Governmental
        Receivables), or upon or with respect to the Lockbox or Lockbox Account,
        or
        assign any right to receive income in respect thereof, or take any action
        that
        could give rise to, or omit to take any action that could preclude or limit,
        a
        right of CMS or any other Person to set off any amount against any Governmental
        Receivables;

       

      (ii)  outside
        the ordinary course of business, extend, amend or otherwise modify the terms
        of
        any Healthcare Receivable, or amend, modify or waive any term or condition
        of
        any Contract related thereto;

       


      
        
          
          

        

        
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      (iii)  make
        any
        change in the character of its business or in its credit and collection policy
        (except for changes required by state or federal statutes, rules or regulations
        or for continued participation in third-party payment programs in which event
        the Provider shall promptly provide PHCC notice thereof), which change would,
        in
        either case, (x) impair the timing of collection or ultimate collectibility
        of
        any Healthcare Receivable or (y) affect the ability of the Servicer to perform
        its duties with respect to the Healthcare Receivables;

       

      (iv)  withdraw,
        attempt to withdraw or cause the withdrawal of any amounts from the Lockbox
        or
        Lockbox Account or instruct any bank or any other Person to transfer any
        amounts
        in the Lockbox or Lockbox Account other than as set forth in this
        Agreement;

       

      (v)  (A)
        amend, modify, supplement or delete in any way or to any extent any provision
        for uncollectible accounts and free care applicable to any Healthcare Receivable
        or (B) amend, modify or supplement in any way or to any extent any financial
        class or change in any way or to any extent the manner in which any financial
        class is treated or reflected in the Provider’s records (including, but not
        limited to, the Healthcare Receivables files);

       

      (p)  the
        Provider shall not, without first providing written notice to PHCC and the
        Servicer:

       

      (i)  outside
        the ordinary course of business, extend, amend or otherwise modify the terms
        of
        any Healthcare Receivable or amend, modify or waive any term or condition
        of any
        Contract related thereto; or

       

      (ii)  withdraw,
        attempt to withdraw or cause the withdrawal of any amounts from the Lockbox
        or
        the Lockbox Account or instruct any bank or any other Person to transfer
        any
        amounts in the Lockbox or the Lockbox Account other than as set forth in
        the
        Servicing Agreement;

       

      (q)  the
        Provider agrees to indemnify, hold harmless and forever defend PHCC from
        any and
        all liability and expenses arising out of the sale of goods, wares, merchandise,
        or services evidenced by the Healthcare Receivables, whether asserted by
        the
        Provider, the Obligor on such Healthcare Receivables or by any other
        Person;

       

      (r)  in
        no
        event shall PHCC be obligated to pursue, on the Provider’s behalf, collection of
        the Healthcare Receivables through use of litigation or otherwise;

       


      
        
          
          

        

        
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      (s)  no
        provision hereof shall obligate PHCC in any manner or to any degree, to the
        Provider or to any third party whether such third party is with or without
        notice of this Agreement, to perform for the Provider in regard to the
        underlying Contract which gave rise to any Healthcare Receivable and the
        Provider covenants and agrees to indemnify and hold PHCC harmless for any
        and
        all performance, responsibility or duty owed by the Provider to any Obligor
        for
        a Healthcare Receivable or any third party; and

       

      (t)  
        the
        Provider covenants and agrees to fully comply, in an acceptable manner, with
        the
        terms of any and all agreements with Obligors for the Healthcare Receivables
        to
        the extent such might affect the Healthcare Receivables; and

       

      (u)  If
        an
        Event of Default exists, or such distribution would give rise to an Event
        of
        Default as relates to any covenant or representation herein, the Provide
        shall
        not make any distribution of assets to its stockholders as such whether in
        cash,
        assets or obligations of such Borrower.

       

      (v)  the
        Provider shall not fund or make distributions of any kind (including, but
        not
        limited to, advances, loans, payables, dividends, or investment in any form)
        to
        any non-Borrower Affiliate; provided however, in the normal course of business,
        Provider shall be permitted to: (1) repay short terms loans received from
        non-Borrower Affiliates and (2) pay existing management fees, in an amount
        not
        to exceed five percent (5%) of Provider’s annual revenue, to non-Borrower
        Affiliates. For purposes hereof, “Affiliate” means, with respect any entity,
        business or trade which is under common control or ownership with Borrower,
        (where the term “control” means the possession, direct or indirect, of the power
        to cause the direction of the management and policies of a person or entity,
        whether through the ownership of voting) and includes, but not limited to,
        a
        parent company, sister company, or subsidiary. 

       

      (x) the
        Provider agrees that as long as the Obligations hereunder remain outstanding
        and
        until the Commitment is terminated (unless the PHCC shall otherwise consent
        in
        writing), the Provider shall not incur, create, assume or permit to exist
        any
        indebtedness for borrowed money, howsoever evidenced, or its equivalent
        (including but not limited to leases required to be capitalized under Generally
        Accepted Accounting Principles, in excess of $100,000.00 in the aggregate.
        

       

      (y)
        the
        Provider shall furnish to PHCC on or before the forty fifth (45th) day after
        the
        end of each month, internally prepared consolidating financial statements
        in
        form and substance satisfactory to PHCC and certified by an appropriate officer
        or representative of Borrower, and furnish to PHCC annually on or before
        one
        hundred twenty (120) days after the end of Borrower's fiscal year, a
        consolidating financial statement in form and substance satisfactory to PHCC
        and
        certified after audit by an independent certified public accountant acceptable
        to PHCC, with all such reports to be prepared in accordance with Generally
        Accepted Accounting Principles, consistently applied

       


      
        
          
          

        

        
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      Section
        9.   Default
        by the Provider.

       

      (a)  Any
        of
        the following acts, omissions and/or events shall constitute an “Event of
        Default” by the Provider, in addition to any further events defined elsewhere as
        Events of Default by the Provider:

       

      (i)  breach
        by
        the Provider of its material agreements with any Obligor for a Healthcare
        Receivable;

       

      (ii)  breach
        by
        the Provider of any material obligation, covenant, representation or warranty
        of
        the Provider in any Provider Agreement (including this Agreement) including,
        but
        not limited to, its obligation to direct payment of the Healthcare Receivables
        to the Lockbox or Lockbox Account, to remit funds to PHCC or Servicer, pay
        Servicer fees when due, make a payment under this Agreement when due and/or
        to
        make payments under any Provider Agreement; 

       

      (iii)  any
        of
        the Provider Agreements ceases to be in full force and effect (including,
        without limitation, the termination or expiration of the Servicing
        Agreement);

       

      (iv)  any
        of
        the liens created under the Provider Agreements ceases to constitute a valid
        perfected first priority lien in favor of PHCC on the Collateral in accordance
        with the terms therefore;

       

      (v)  one
        or
        more judgments or decrees is rendered against the Provider in an amount in
        excess of $50,000.00 which is not satisfied, stayed, vacated or discharged
        of
        record within thirty (30) calendar days of being rendered; 

       

      (vi)  any
        Material Adverse Effect, or Material Adverse Change;

       

      (vii)  PHCC
        receives any indication or evidence that the Provider may have directly or
        indirectly been engaged in any type of activity which, in PHCC’s sole reasonable
        judgment, might result in the forfeiture of any property to any governmental
        authority.

       

      (viii)  the
        Provider or any of its respective directors, senior officers, general partners
        or managing members, as applicable, is criminally indicted or convicted under
        any law that could lead to a forfeiture of any Collateral;

       

      (ix)  the
        issuance of any process for levy, attachment or garnishment or execution
        upon or
        prior to any judgment against the Provider or any of its property or assets;
        or

       


      
        
          
          

        

        
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      (x)  the
        insolvency or business failure of the Provider or Provider’s assignment for the
        preference of certain creditors of the Collateral or placing the same in
        the
        custody of any court or the filing by or against the Provider of a petition
        for
        bankruptcy protection.

       

      (xi)  any
        default of the Provider in the payment or performance of any other liabilities,
        indebtedness or obligations of the Provider, to any other creditor, or any
        occurrence which would allow or permit any other liabilities, indebtedness
        or
        obligations to any other creditor to be accelerated; provided however, this
        provision shall not apply unless the aggregate amount of liabilities,
        indebtedness or other obligation subject to default or acceleration exceed
        $100,000.00.

       

      (xii)  Scott
        Holtmyer shall cease to be active in the management of the
        Provider;

       

      (b)  Upon
        the
        occurrence of an Event of Default, and at any time thereafter, PHCC may elect
        (i) to terminate its obligations to make Advances under any Provider
        Agreement, and such obligations shall immediately terminate, (ii) to
        declare all outstanding principal and accrued interest under the Loan, together
        with all outstanding Reimbursable Expenses, Fees, commissions and other expenses
        under the Provider Agreements, immediately due and payable, and/or (iii) to
        foreclose on the security interest granted by the Provider in Section 5 of
        this Agreement to secure amounts due and owing from the Provider, and in
        all
        events, the Provider hereby expressly waives notice, demand and presentment
        with
        regard thereto.

       

      Upon
        the
        occurrence of an Event of Default specified in Section 9(a)(xi) hereof, all
        of
        the Obligations shall become automatically due and payable without declaration,
        notice or demand by PHCC to or upon the Provider and the Provider’s right to
        request Advances shall automatically terminate as if terminated by PHCC pursuant
        to Section 9(b) hereof and with the effects of such a termination by PHCC;
        provided, however, that, if PHCC shall continue to make Advances or otherwise
        extend credit to the Provider pursuant to this Agreement after an automatic
        termination of the Provider’s right to request Advances by reason of the
        occurrence of an Event of Default specified in Section 9(a)(xi) hereof, the
        Provider acknowledges and agrees that such Advances and other credit shall
        nevertheless be governed by this Agreement and enforceable against and
        recoverable from the Provider as if such Event of Default had never
        occurred.

       

      (c)  Upon
        the
        occurrence of an Event of Default and action by PHCC (or automatic acceleration
        in the case of an occurrence of an Event of Default specified in Section
        9(a)(xi) hereof) pursuant to Section 10(b), PHCC shall have and may exercise
        all
        rights provided by the Uniform Commercial Code in any relevant jurisdiction,
        as
        amended from time to time, or by any other law of the state where the Provider
        is “located” as defined by the Uniform Commercial Code of the relevant
        jurisdiction, as amended from time to time, to the maximum extent provided
        thereby. 

       


      
        
          
          

        

        
          -32-

          
            

          

        

        
          
          

        

      


      PHCC
        shall be entitled to avail itself of any such rights and remedies as may
        now or
        hereafter exist at law or in equity for the enforcement of the covenants
        herein
        and the foreclosure of the security interest created hereby and to resort
        to any
        remedy provided hereunder or provided by the Uniform Commercial Code of any
        relevant jurisdiction, or by any other law of any relevant State, shall not
        prevent the concurrent or subsequent employment of any other appropriate
        remedy
        or remedies.

       

      (d)  PHCC
        may
        remedy any default, without waiving same, or may waive any default without
        waiving any prior or subsequent default.

       

      (e)  The
        security interest herein granted shall not be affected by nor affect any
        other
        security taken for the indebtedness hereby secured, or any part thereof;
        and any
        extensions may be made of PHCC’s rights and such security interest and any
        releases may be executed or herein conveyed without affecting the priority
        of
        such security interest or the validity thereof with reference to any third
        Person, and the holder of said rights shall not be limited by any election
        of
        remedies if he chooses to foreclose this security interest by suit.

       

      (f)  Any
        requirement of reasonable notice to the Provider of the time and place of
        any
        sale of the Collateral, or any other intended disposition thereof to be made,
        shall be met if such notice is mailed, postage prepaid, to the Provider at
        the
        last known business address of the Provider, as required by law.

       

      (g)  The
        Provider hereby expressly acknowledges that, the Provider’s breach of any of the
        other covenants, obligations, representations or warranties contained in
        any
        Provider Agreement or any Contract would cause irreparable injury and damage
        to
        PHCC in a manner that could not be adequately compensated by monetary damages
        alone. The parties specifically agree that the breach or threatened breach
        by
        the Provider of any Provider Agreement or any Contract could cause PHCC to
        suffer irreparable injury if injunctive relief is not granted and, therefore,
        PHCC shall have the right, at its election and in addition to any and all
        other
        remedies available to it, upon any such breach or threatened breach, to seek
        immediate injunctive relief from a court of competent jurisdiction, requesting
        such orders and restraining the Provider from all actions which such court
        deems
        necessary to adequately protect PHCC from further damage or injury. In any
        instance of a breach or threatened breach for which injunctive relief is
        deemed
        necessary by PHCC, the Provider hereby waives demand or notice of default
        and
        waives the requirements, if any, for posting bond in connection with the
        granting of injunctive relief.

       


      
        
          
          

        

        
          -33-

          
            

          

        

        
          
          

        

      


      


       

      Section
        10.   Indemnity;
        Payment of Expenses. In
        the
        event (a) any of the Provider’s warranties or representations shall prove to be
        false or misleading; (b) any Obligor in judicial proceedings shall assert
        against PHCC or any of its officers, employees, directors, managers or agents
        a
        claim or defense arising out of any transaction between the Obligor and the
        Provider; or (c) the Provider or any other person or entity shall assert
        against
        PHCC or any of its officers, employees, directors, managers or agents a claim
        or
        defense arising out of or relating to any of the Collateral, the Loan or
        any of
        the documents executed in connection with the Loan, the Provider agrees to
        indemnify and hold PHCC harmless from and against any liability, judgment,
        cost,
        attorneys’ fees or other expense whatsoever arising therefrom.

       

      The
        Provider agrees, on demand, to (a) pay or reimburse PHCC for all Reimbursable
        Expenses and (b) pay, indemnify, and hold PHCC harmless from and against
        any and
        all other liabilities, obligations, losses, damages, penalties, actions,
        judgments, suits, costs, expenses or disbursements of any kind or nature
        whatsoever (except with respect to taxes and other amounts governed by Section
        2(e) above), with respect to the execution, delivery, enforcement, performance
        and administration of this Agreement, the Note and the other Provider Agreements
        (all the foregoing, collectively, the “indemnified
        liabilities”),
        provided that the Provider has no obligation hereunder to PHCC with respect
        to
        indemnified liabilities arising from the gross negligence or willful misconduct
        of PHCC.

       

      Section
        11.   Term
        and Termination.
        Unless
        earlier terminated pursuant to the terms hereof, this Agreement shall continue
        in full force and effect until the Scheduled Maturity Date. Any party to
        this
        Agreement may, after the expiration of 180 days from the date of this Agreement,
        terminate this Agreement upon giving to the other at least thirty (30) days’
prior written notice of termination by registered or certified mail given
        as
        provided in Section 13(h);
        provided,
        however, that as a condition precedent to Provider’s termination of this
        Agreement prior to the expiration of the Term pursuant to the foregoing,
        Provider shall have paid to PHCC a Prepayment Fee in the following amount:
        (1)
        if the effective date of such termination occurs prior to the first anniversary
        of the effective date of this Agreement, two percent (2.0%) of the Maximum
        Aggregate Loan Amount in effect on the effective date of the termination;
        and
        (2) if the effective date of such termination occurs after the first anniversary
        of the effective date of this Agreement but prior to the Scheduled Maturity
        Date, one percent 1.0% of the Maximum Aggregate Loan Amount in effect on
        the
        effective date of the termination. .PHCC shall have the right to terminate
        this
        Agreement, by written notice to the Provider, at any time during which an
        Event
        of Default hereunder has occurred and is continuing. Termination, however,
        shall
        not relieve or discharge the Provider of its duties, obligations or covenants
        hereunder until all of the Provider’s obligations to PHCC have been satisfied or
        paid in full, and all of the terms, provisions and conditions of this Agreement
        and the Provider Agreements shall remain in effect. If, after receipt of
        any
        payment of all or any part of the Provider’s obligations hereunder, PHCC is for
        any reason compelled to surrender such payment to any Person because such
        payment is determined to be void or voidable as a preference, impermissible
        setoff or a diversion of trust funds, or for any other reason, this Agreement
        shall continue in full force and the Provider shall be liable to PHCC for,
        and
        shall indemnify and hold PHCC harmless for, the amount of such payment
        surrendered. 

       


      
        
          
          

        

        
          -34-

          
            

          

        

        
          
          

        

      


      The
        provisions of this Section 11 shall be and remain effective notwithstanding
        any
        contrary action which may have been taken by PHCC in reliance upon such payment,
        and any such contrary action so taken shall be without prejudice to PHCC’s
        rights under this Agreement and shall be deemed to have been conditioned
        upon
        such payment having become final and irrevocable. The provisions of this
        Section
        11 shall survive the termination of the Agreement.

       

      Section
        12.   Miscellaneous.

       

      (a)  THE
        NOTE,
        THIS AGREEMENT AND ALL OF THE OTHER LOAN DOCUMENTS, AND ALL RIGHTS AND
        OBLIGATIONS HEREUNDER AND THEREUNDER, INCLUDING MATTERS OF CONSTRUCTION,
        VALIDITY AND PERFORMANCE, SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
        WITH
        THE INTERNAL LAWS OF THE STATE OF GEORGIA, EXCEPT THAT ANY CONFLICT OF LAWS
        RULE
        OF SUCH JURISDICTION THAT WOULD REQUIRE REFERENCE TO THE LAWS OF SOME OTHER
        JURISDICTION SHALL BE DISREGARDED. ANY SUITS, CLAIMS OR CAUSES OF ACTION
        ARISING
        DIRECTLY OR INDIRECTLY FROM THIS AGREEMENT, THE NOTE, THE OTHER LOAN DOCUMENTS
        OR ANY OTHER AGREEMENTS OR INSTRUMENTS BETWEEN PHCC AND PROVIDER RELATING
        TO
        SUCH DOCUMENTS (except for the enforcement of an equitable remedy by PHCC
        under
        the provisions of Section 10(g)) MAY BE BROUGHT IN A COURT OF APPROPRIATE
        JURISDICTION IN DEKALB COUNTY, GEORGIA, AND OBJECTIONS TO VENUE AND PERSONAL
        JURISDICTION IN SUCH FORUM ARE HEREBY EXPRESSLY WAIVED. THIS AGREEMENT HAS
        BEEN
        NEGOTIATED AND IS BEING EXECUTED AND DELIVERED IN THE STATE OF GEORGIA, OR
        IF
        EXECUTED BY PROVIDER ELSEWHERE, SHALL BECOME EFFECTIVE UPON PHCC’S RECEIPT AND
        EXECUTION OF THE ORIGINAL OF THIS AGREEMENT IN THE STATE OF GEORGIA; PROVIDED,
        HOWEVER, THAT PHCC SHALL HAVE NO OBLIGATION TO GIVE, NOR SHALL PROVIDER BE
        ENTITLED TO RECEIVE ANY NOTICE OF SUCH RECEIPT AND EXECUTION FOR THIS AGREEMENT
        TO BECOME A BINDING OBLIGATION OF PROVIDER. IT IS INTENDED, AND PROVIDER
        AND
        PHCC SPECIFICALLY AGREE, THAT THE LAWS OF THE STATE OF GEORGIA GOVERNING
        INTEREST SHALL APPLY TO THIS TRANSACTION. PROVIDER HEREBY ACKNOWLEDGES THAT
        PROVIDER UNDERSTANDS, ANTICIPATES, AND FORESEES THAT ANY ACTION FOR ENFORCEMENT
        OF PAYMENT OF THE LOAN OR THE LOAN DOCUMENTS MAY BE BROUGHT AGAINST IT IN
        THE
        STATE OF GEORGIA. TO THE EXTENT ALLOWED BY LAW, PROVIDER HEREBY SUBMITS TO
        JURISDICTION IN THE STATE OF GEORGIA FOR ANY ACTION OR CAUSE OF ACTION ARISING
        OUT OF OR IN CONNECTION WITH THE LOAN OR THE LOAN DOCUMENTS AND WAIVES ANY
        AND
        ALL RIGHTS UNDER THE LAWS OF ANY STATE OR JURISDICTION TO OBJECT TO JURISDICTION
        OR VENUE WITHIN DEKALB COUNTY, GEORGIA; 

       


      
        
          
          

        

        
          -35-

          
            

          

        

        
          
          

        

      


      NOTWITHSTANDING
        THE FOREGOING, NOTHING CONTAINED IN THIS PARAGRAPH SHALL PREVENT PHCC FROM
        BRINGING ANY ACTION OR EXERCISING ANY RIGHTS AGAINST PROVIDER, ANY GUARANTOR,
        ANY SECURITY FOR THE LOAN, OR ANY OF PROVIDER’S OR ANY GUARANTOR’S PROPERTIES IN
        ANY OTHER COUNTY, STATE, OR JURISDICTION. INITIATING SUCH ACTION OR PROCEEDING
        OR TAKING ANY SUCH ACTION IN ANY OTHER STATE OR JURISDICTION SHALL IN NO
        EVENT
        CONSTITUTE A WAIVER BY PHCC OF ANY OF THE FOREGOING. 

       

      To
        the
        extent that any rule of procedure or rule of substantive law or statute of
        any
        state or regulations of any political subdivision would permit Provider to
        assert a legal argument that insufficient contacts with the State of Georgia
        exist to apply the law of the State of Georgia or that the law of another
        State
        should apply, the Provider hereby, to the fullest extent permitted by law,
        waives such rights and agrees not to assert such claims. The failure of the
        Provider to qualify to do business in the State of Georgia shall not be basis
        for the Provider to assert that the law of another state, other than Georgia
        should apply to any dispute. Notwithstanding the above provision for the
        application of choice-of-law, the parties acknowledge that in regard to the
        proper application of the Uniform Commercial Code as amended from time to
        time
        that the law of the Uniform Commercial Code statutes of another state may
        be
        applicable to determine the rights of the parties relative to creditors of
        the
        Provider.

       

      (b)  The
        Provider shall be liable for attorneys’ fees and other costs incurred by PHCC in
        enforcing its rights hereunder and/or in taking any legal action to settle,
        collect or defend the Healthcare Receivables or any part thereof or security
        interest therein, together with interest on unpaid amounts at the maximum
        rate
        permitted by law. Attorneys’ fees relating to enforcement and collection by PHCC
        for which the Provider shall be responsible to reimburse PHCC shall be equal
        to
        the lesser of: (1) actual out-of-pocket attorneys’ fees or (2) fifteen percent
        (15%) (or the maximum rate permitted by law) of the principal and interest
        owed
        hereunder at the time of commencement of collection activities. This Agreement,
        and the Exhibits and Appendices attached hereto from time to time, set forth
        the
        complete and entire understanding between the Provider and PHCC as to the
        terms
        hereof. Such Agreement shall only be modified by a written instrument signed
        by
        all parties to be bound thereby.

       

      (c)  Failure
        or delay by PHCC in exercising any right hereunder shall not waive the later
        assertion of that right nor waive the Provider’s future
        performance.

       

      (d)  PHCC
        shall at all times have access to the Provider’s financial records to the extent
        necessary to protect PHCC’s position hereunder and/or its interest in the
        Collateral. The Provider shall furnish all financial data to PHCC, immediately
        upon request for such from PHCC, and from time to time; such financial data
        to
        include, but not be limited to, receipts for all required tax payments, proof
        of
        payment of all insurance including workers’ compensation payments, proof of
        payment of all current payables, Medicare cost reports, Medicare cost report
        settlement statements and applicable state compliance information.

       


      
        
          
          

        

        
          -36-

          
            

          

        

        
          
          

        

      


      


       

      (e)  All
        rights of PHCC against the Provider, in the event of the nonperformance or
        breach by the Provider shall survive the termination of this
        Agreement.

       

      (f)  This
        Agreement shall be binding on and inure to the benefit of the parties hereto
        and
        their legal representatives, heirs, executors, administrators, successors
        and
        permitted assigns.

       

      (g)  Any
        notice to be given hereunder shall be sufficient if in writing and personally
        delivered or mailed, postage prepaid, by U.S. registered or certified mail,
        return receipt requested, to the parties’ addresses as set forth below. Notice
        shall be deemed given two Business Days following dispatch as set forth
        above.

       

      (h)  The
        representations and warranties made by the Provider shall be true on the
        date of
        execution of this Agreement and the Provider shall reaffirm the truth of
        the
        representations and warranties on each day thereafter during the term of
        this
        Agreement. The representations and warranties made by the Provider shall
        survive
        the termination of this Agreement until the expiration of the statute of
        limitations period applicable to the claims that may be asserted against
        the
        Provider or the assets of the Provider.

       

      (i)  In
        no
        event shall this Agreement be interpreted or enforced to contract for, charge
        or
        authorize receipt of any interest in excess of the maximum nonusurious rate
        of
        interest chargeable under applicable law in regard to which no claim or defense
        of usury could successfully be asserted. Any amount determined by a court
        of
        proper jurisdiction as usurious interest shall be deemed a mistake and shall
        be
        refunded to the payor or credited to authorized amounts owed by such payor
        to
        PHCC. Provided that nothing hereinabove shall limit any fees or expenses
        payable
        to PHCC where such do not constitute “interest.”

       

      (j)  The
        Provider Agreements and the interest of the Provider in the Collateral may
        not
        be sold, assumed, assigned or encumbered (except as provided in this Agreement)
        by the Provider. Upon notice to Provider, this Agreement, the Note and any
        and
        all of the Loan Documents may be assigned in whole or in part by PHCC without
        the consent of the Provider. The Provider understands that, upon notice to
        Provider, PHCC may from time to time enter into a participation agreement
        or
        agreements with one or more participants pursuant to which each such participant
        shall be given a participation in the Loan and that any such participant
        may
        from time to time similarly grant to one or more sub-participants
        sub-participations in the Loan. The Provider agrees that, to the extent provided
        under the participation agreements, any participant or sub-participant may
        exercise any and all rights of banker's lien or set-off with respect to the
        Provider, as fully as if such participant or sub-participant had made the
        Loan
        directly to the Provider in the amount of the participation or sub-participation
        given to such participant or sub-participant in the Loan. 

       


      
        
          
          

        

        
          -37-

          
            

          

        

        
          
          

        

      


      For
        the
        purposes of this Section 12(k) only, the Provider shall be deemed to be directly
        obligated to each participant or sub-participant in the amount of its
        participating interest in the amount of the Loan and any other indebtedness
        arising under the Loan and the Loan Documents. PHCC may divulge to any
        participant or sub-participant all information, reports, financial statements,
        certificates and documents obtained by it from the Provider or any other
        person
        under any provision of this Agreement or otherwise.

       


      
        
          
          

        

        
          -38-

          
            

          

        

        
          
          

        

      


      Executed
        to be effective this 17th day
        of April, 2007.

       

       

      PRESIDENTIAL
        HEALTHCARE CREDIT CORPORATION

       

      By       
        /s/ Phil Hooker

      Name  
        Phil Hooker

      Title    
        President

       

      Address: 1979
        Lakeside Parkway   

                  
        Suite
        400

          
    Tucker,
        GA
        30084

      PROVIDER

      


       

      PARK
        INFUSIONCARE, LP

       

      By:
         
        Dougherty’s Operating GP, LLC

      Its
        General Partner

      By:
        /s/David
        E. Bowe

      Name:
        David E. Bowe

      Title:
         
        Managing
        Member, Chairman, President & CEO

      Address:
        16250 Dallas Parkway, Suite 100

      Dalllas,
        Texas 75248 

      


       

      THE
        STATE
        OF OKLAHOMA

       

      COUNTY
        OF
        BRYAN

       

      BEFORE
        ME, the undersigned authority, on this day personally appeared David
        E. Bowe,
        Managing
        Member,
        Chairman,
        President and CEO of Dougherty’s Operating GP, LLC,
        a Texas
        limited liability company, known to me to be the person whose name is subscribed
        to the foregoing instrument, and acknowledged to me that he/she signed the
        foregoing instrument and acknowledged to me that he/she executed the same
        for
        the purposes and consideration therein expressed, in the capacities therein
        stated and as the act and deed of said limited liability company.

      


      Given
        under my hand and seal of office on this 17th
        day of April,
        2007.

       

      /s/
Notary
        Public, State of Oklahoma

       


      
        
          
          

        

        
          -39-

          
            

          

        

        
          
          

        

      


      


       

      PARK
        INFUSIONCARE OF DALLAS, LP

      


      BY:
         
        Park
        Infusioncare Of Dallas, GP, LLC

         
        Its
        General Partner

      


      By:
        /s/
        David E. Bowe

      Name:
        David E. Bowe

      Title:
         
        Managing
        Member, Chairman, President & CEO

      Address:
        16250 Dallas Parkway, Suite 100

      Dalllas,
        Texas 75248 

      


       

       

      
        THE
          STATE
          OF OKLAHOMA

         

        COUNTY
          OF
          BRYAN

      

       

      BEFORE
        ME, the undersigned authority, on this day personally appeared David
        E. Bowe,
        Managing
        Member,
        Chairman,
        President and CEO of Park InfusionCare of Dallas GP, LLC,
        a Texas
        limited liability company, known to me to be the person whose name is subscribed
        to the foregoing instrument, and acknowledged to me that he/she signed the
        foregoing instrument and acknowledged to me that he/she executed the same
        for
        the purposes and consideration therein expressed, in the capacities therein
        stated and as the act and deed of said limited liability company.

       

      
        Given
          under my hand and seal of office on this 17th
          day of April,
          2007.

         

        /s/
Notary
          Public, State of Oklahoma

      

       

       

       

      
        
          
          

        

        
          -40-

          
            

          

        

        
          
          

        

      


      PARK
        INFUSIONCARE OF HOUSTON, LP

      


      By:
         Park
        Infusioncare Of Houston, GP, LLC

      Its
        General Partner

      


      By:
        /s/
        David E. Bowe

      Name:
        David E. Bowe

      Title:
         
        Managing
        Member, Chairman, President & CEO

      Address:
        16250 Dallas Parkway, Suite 100

      Dalllas,
        Texas 75248 

      


       

       

      
        THE
          STATE
          OF OKLAHOMA

         

        COUNTY
          OF
          BRYAN

      

      
 

      BEFORE
        ME, the undersigned authority, on this day personally appeared David
        E. Bowe,
        Managing
        Member, Chairman, President and CEO of Park InfusionCare of Houston, GP,
        LLC,
        a Texas
        limited liability company, known to me to be the person whose name is subscribed
        to the foregoing instrument, and acknowledged to me that he/she signed the
        foregoing instrument and acknowledged to me that he/she executed the same
        for
        the purposes and consideration therein expressed, in the capacities therein
        stated and as the act and deed of said limited liability company.

      


      
        
          Given
            under my hand and seal of office on this 17th
            day of April,
            2007.

           

          /s/
Notary
            Public, State of Oklahoma

        

      

      


       

       

      



      
        
          
          

        

        
          -41-

          
            

          

        

        
          
          

        

      


      


      


      PARK
        INFUSIONCARE OF SAN ANTONIO LP

      


      By:
         
        Park
        Infusioncare Of San Antonio, GP, LLC

      Its
        General Partner

      By:
        /s/
        David E. Bowe

      Name: 
        David E.
        Bowe

      Title:
         
        Managing
        Member, Chairman, President & CEO

      Address:
        16250 Dallas Parkway, Suite 100

      Dalllas,
        Texas 75248\ 

      


                  

        
          THE
            STATE
            OF OKLAHOMA

           

          COUNTY
            OF
            BRYAN

        

      

       

      BEFORE
        ME, the undersigned authority, on this day personally appeared David
        E. Bowe,
        Managing
        Member, Chairman, President and CEO of Park InfusionCare of San Antonio,
        GP,
        LLC,
        a Texas
        limited liability company, known to me to be the person whose name is subscribed
        to the foregoing instrument, and acknowledged to me that he/she signed the
        foregoing instrument and acknowledged to me that he/she executed the same
        for
        the purposes and consideration therein expressed, in the capacities therein
        stated and as the act and deed of said limited liability company.

      


      Given
        under my hand and seal of office on this 17th 
        day of
April,
        2007.

       

      /s/
Notary
        Public, State of Oklahoma

      


      


      
        
          
          

        

        
          -42-

          
            

          

        

        
          
          

        

      

      


       

      



      APPENDIX
        I

       

      


       

      DEFINITIONS

       

      Except
        as
        otherwise specified or as the context of this Agreement may otherwise require,
        the following terms have the respective meanings set forth below for all
        purposes of this Agreement and the definitions of such terms are applicable
        to
        the singular as well as the plural forms of such terms and to the masculine
        as
        well as to the feminine and neuter genders of such terms. Terms which are
        defined in the UCC and used in this Agreement without definition shall have
        the
        meanings assigned thereto in the UCC.

       

      “Accounts”
        means all of the Provider’s (or other entities’, as applicable) accounts (as
        defined in the UCC).

       

      “Advance”
means
        a
        borrowing by the Provider pursuant to the Note and subject to the terms of
        this
        Agreement. Any amounts paid by PHCC on the Provider’s behalf under any Provider
        Agreement shall be an Advance for purposes of this Agreement.

       

      “Advance
        Day”
        means
        the day of each week agreed upon by the Provider and PHCC on which Advances
        are
        to be made or if such day is not a Business Day the next succeeding Business
        Day.

       

      “Advance
        Request”
means
        the form of advance request set forth in Exhibit E.

       

      “Agreement”
has
        the
        meaning set forth in Section 1 of this Agreement.

       

      “Authorized
        Person”
means
        each officer, general partner or managing member, as the case may be, of
        the
        Provider specifically authorized by the Provider to make Advance Requests
        on the
        Note and whose name is included on a written list of names previously provided
        to PHCC by the Provider, which list is certified by the Provider.

       

      “Availability
        Amount”
has
        the
        meaning set forth in Section 2(a)(ii) of this Agreement.

       

      “Availability
        Certificate”
means
        the form of certificate set forth in Exhibit E.

       

      “Blue
        Cross/Blue Shield Contract”
means
        any and all agreements between the Provider and any Blue Cross/Blue Shield
        plan.

       

      “Business
        Day”
means
        each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on
        which
        banking institutions in the State of Georgia generally and the City of Tucker,
        Georgia, are authorized or obligated by law or executive order to
        close.

       

      “Closing
        Date”
means
        the date upon which all of the conditions precedent to the consummation of
        the
        transactions contemplated by this Agreement are satisfied or PHCC has given
        to
        the Provider a written waiver thereof.

       


      
        
          
          

        

        
          -43-

          
            

          

        

        
          
          

        

      


      


       

      “CMS”
means
        the U.S. Center for Medicare and Medicaid Services.

       

      “Collateral”
has
        the
        meaning set forth in Section 5(a) of this Agreement.

       

      “Collections”
means
        the amounts received or deemed received by the Servicer or PHCC with respect
        to
        a Healthcare Receivable.

       

      “Commitment”
means
        the obligation of PHCC to make Advances pursuant to the terms of this Agreement
        up to the amount set forth on Exhibit A hereto.

       

      “COMN”
means,
        with respect to a DME Receivable, the certificate of medical necessity for
        the
        medical equipment sold, rented or leased by Provider.

       

      “Contract”
means
        an agreement pursuant to or under which an Obligor is obligated to pay for
        services rendered or medical equipment or goods sold, leased or rented to
        patients of the Provider from time to time.

       

      “Control
        Agreement”
has
        the
        meaning set forth in Section 4(a) of this Agreement.

       

      “Eligible
        Obligor”
means
        an Insurer or a Governmental Entity.

       

      “Eligible
        Receivables”
means
        each Healthcare Receivable existing on the Closing Date and arising during
        the
        term of this Agreement, unless (or to the extent):

       

      (a)  such
        Healthcare Receivable is not payable by an Eligible Obligor;

       

      (b)  the
        amount stated on the claim sent to the Obligor is not payable in full by
        such
        Obligor (in which case only the Net Value of such Healthcare Receivable shall
        be
        an Eligible Receivable);

       

      (c)  such
        Healthcare Receivable or any related Contract has been compromised, adjusted,
        extended, satisfied, subordinated, rescinded, set off or modified by the
        Provider or is subject to compromise, adjustment, extension, satisfaction,
        subordination, rescission, setoff, counterclaim, defense or modification,
        whether arising out of transactions concerning the Contract or
        otherwise;

       

      (d)  on
        the
        date of determining whether such Healthcare Receivable is an Eligible Receivable
        the Provider has not delivered to PHCC or the Servicer true and correct copies
        of all claims, agreements and other documents relating to the creation of
        such
        Healthcare Receivable, as required pursuant to this Agreement;

       

      (e)  such
        Healthcare Receivable is not owned by the Provider free and clear of any
        claim
        of ownership of any other Person or is subject to any sale, lien, security
        interest, financing statement or other charge or encumbrance or other type
        of
        preferential arrangement having the effect of a lien or security interest,
        in
        favor of any Person other than as contemplated by this Agreement;

       


      
        
          
          

        

        
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      (f)  such
        Healthcare Receivable is not subject to a valid, perfected, first-priority
        security interest in favor of PHCC;

       

      (g)  such
        Healthcare Receivable does not comply with all laws and regulations applicable
        thereto;

       

      (h)  such
        Healthcare Receivable does not constitute an “Account” under the Uniform
        Commercial Code in effect in any jurisdiction deemed to govern the creation,
        perfection, and effect of perfection or non-perfection of a security interest
        therein;

       

      (i)  such
        Healthcare Receivable is evidenced by “negotiable documents,” “instruments” or
“tangible chattel paper” within the meaning of the Uniform Commercial Code in
        any jurisdiction deemed to govern the creation, perfection, and effect of
        perfection or non-perfection of a security interest therein;

       

      (j)  such
        Healthcare Receivable does not represent and constitute a legal, valid and
        binding obligation of the related Obligor enforceable against such Obligor
        in
        accordance with its terms;

       

      (k)  such
        Healthcare Receivable constitutes or has constituted an obligation of any
        subsidiary, parent or other Person which is an affiliate of the
        Provider;

       

      (l)  such
        Healthcare Receivable is not based on a prospective (with respect to
        Governmental Receivables, solely as contemplated by the CMS in the rules
        and
        regulations governing the prospective payment system for healthcare providers
        or
        similar governmental programs or regulations), or an actual and bona fide
        rendition of services to, or the furnishing of goods or medical equipment
        provided to, a patient by the Provider in the ordinary course of its
        business;

       

      (m)  such
        Healthcare Receivable is not denominated and payable only in lawful currency
        of
        the United States; 

       

      (n)  the
        goods
        and services provided and reflected in such Healthcare Receivable, or the
        medical equipment provided, were not medically necessary, or the patient
        did not
        receive such goods, services or medical equipment;

       

      (o)  the
        fees
        for services or goods constituting the basis for such Healthcare Receivable
        are
        subject to limitations imposed by contracts for reimbursement from the related
        Obligor, and such fees exceed the limitations so imposed (in which case only
        such portion of such Healthcare Receivable meeting the requirements of such
        limitations, as determined by PHCC, shall be an Eligible
        Receivable);

       


      
        
          
          

        

        
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      (p)  
        there
        are procedures or investigations pending or threatened before a Governmental
        authority (i) asserting the invalidity of such Healthcare Receivable or any
        Contract related thereto, (ii) seeking the repayment of such Healthcare
        Receivable or payment and performance of such Contract or (iii) seeking any
        determination or ruling that might materially and adversely affect the validity
        or enforceability of such Healthcare Receivable or any Contract related
        thereto;

       

      (q)  such
        Healthcare Receivable or Contract related thereto contravenes in any material
        respect any federal, state or local laws, rules or regulations applicable
        thereto (including, without limitation, the rules and regulations of CMS
        and
        laws, rules and regulations relating to usury, consumer protection, truth
        in
        lending, fair credit billing, fair credit reporting, equal credit opportunity,
        fair debt collection practices and privacy), or a party to such related Contract
        is in violation of any such law, rule or regulation in any material respect;
        

       

      (r)  the
        related Obligor for such Healthcare Receivable has commenced a voluntary
        case
        under any bankruptcy or reorganization law, has made an assignment for the
        benefit of creditors, has entered against it a decree or order for relief
        in an
        involuntary case under any bankruptcy or reorganization law by a court having
        jurisdiction in respect of such Obligor, or has failed, suspended business,
        ceased to be solvent, called a meeting of its creditors, or has consented
        to or
        suffered a receiver, trustee, liquidator or custodian to be appoint for it
        or
        for all or a significant portion of its assets or affairs, or the Provider,
        in
        the ordinary course of business, should have known of any of the foregoing;
        

       

      (s) such
        Healthcare Receivable fails to comply with such additional criteria and
        requirements which may, from time to time, be established by PHCC pursuant
        to
        this Agreement or is not otherwise satisfactory to PHCC, as determined in
        PHCC’s
        reasonable sole discretion;

       

      (t) such
        Healthcare Receivable has been outstanding and unpaid for more than the lessor
        of one hundred-twenty (120) days from the date
        of billing or one hundred fifty (150) days from the ending date of service;
        

       

      (u) such
        Healthcare Receivable is otherwise unacceptable to PHCC in its sole reasonable
        discretion.

       

      “EOB/ERA”
means
        the explanation of benefits that is provided by an Obligor explaining how
        it
        determined the amount it will or will not pay with respect to a Healthcare
        Receivable of which it is the Obligor.

       

      “Event
        of Default”
means
        any one of the events described in Section 10 of this Agreement.

       

      “Excess”
has
        the
        meaning set forth in Section 2(c)(iv) of this Agreement.

       


      
        
          
          

        

        
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      “Fees”
means
        all fees payable by the Provider pursuant to the Provider Agreements, including
        without limitation, the Initial Commitment Fee, the Unused Line Fee, the
        Prepayment Fee and the Overadvance Fee.

       

      “Governmental
        Agreement”
means
        an agreement entered into between a state agency or other Person administering
        a
        Governmental Program, including the Medicaid program, and the Provider under
        which the Provider agrees to provide services or merchandise for patients
        participating in that Governmental Program in accordance with the terms of
        that
        agreement and regulations applicable to that Governmental Program.

       

      “Governmental
        Certification”
means
        the certification of a facility by CMS or a state agency or entity under
        contract with CMS that the facility fully complies with all the conditions
        set
        forth in Medicaid regulations, Medicare regulations or a combination thereof,
        as
        applicable to such facility.

       

      “Governmental
        Consents”
means
        all licenses issued by a state health agency or similar agency or body
        certifying that a facility of the Provider has been inspected and found to
        comply with applicable law for operating such health facility, any applicable
        accreditation certification by the Joint Commission for Accreditation of
        Health
        Care Organizations that such facility fully complies with the standards set
        by
        it for operation of such facility, and Governmental Certifications necessary
        for
        the activities and business of the Provider as currently conducted and proposed
        to be conducted, the ownership, use, operation and maintenance of its
        properties, facilities and assets and the performance by the Provider of
        this
        Agreement and the related transactions contemplated by this
        Agreement.

       

      “Governmental
        Entity”
or
        “Governmental
        Obligor”
means
        the United States, any State, any political subdivision of a State and any
        agency or instrumentality of the United States or any State, political
        subdivision or fiscal intermediary thereof which is obligated to make any
        payments with respect to Medicare or Medicaid Receivables or with respect
        to
        Healthcare Receivables representing amounts owing under any other program
        established by federal or state law which provides for payments for healthcare
        services to be made to the Providers of such services (including, without
        limitation, CMS and the program set forth in Title 38 U.S.C. Section
        1713).

       

      “Governmental
        Programs”
means
        Medicare or Medicaid.

       

      “Governmental
        Receivable”
means
        a
        Healthcare Receivable that is payable by a Governmental Obligor.

       


      
        
          
          

        

        
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      “Healthcare
        Receivables”
means
        all accounts receivable billed to Obligors representing amounts due and owing
        to
        the Provider arising from the prospective (with respect to Governmental
        Receivables, solely as contemplated by the CMS in the rules and regulations
        governing the prospective payment system for healthcare providers or similar
        governmental programs or regulations), or actual (i) sale, rental or lease
        of
        durable health care goods (including, without limitation, medical equipment),
        or
        (ii) the provision of medical services (and services and sales ancillary
        thereto), including all rights and remedies of the Provider relating thereto,
        together with any and all proceeds in any way derived, directly or indirectly,
        therefrom; provided, however, that “Healthcare Receivable” shall not include
        claims arising under any workers’ compensation statutes. 

       

      “Initial
        Commitment Fee”
means
        the fee set forth in Section 2(d) of this Agreement in consideration for
        PHCC’s
        Commitment.

       

      “Insurer”
means
        any nonindividual Person, other than a Governmental Entity, located in the
        United States which, in the ordinary course of its business or activities,
        agrees to pay for healthcare goods and services received by individuals,
        including, without limitation, a commercial insurance company, a nonprofit
        insurance company (such as a Blue Cross/Blue Shield entity), an employer
        or
        union who self-insures for employee or member health insurance, an HMO and
        a
        PPO. “Insurer” shall include insurance companies issuing health, personal
        injury, workmen’s compensation or other types of insurance.

       

      “Interest”
has
        the
        meaning set forth in Section 2(c)(iv) of this Agreement.

       

      “Interest
        Payment Date”
        means
        (i) the first Business Day of each calendar month during the term of this
        Agreement or during such time as amounts remain outstanding on the Note,
        commencing on the first Business Day of the calendar month following the
        month
        in which the Note or any successor Note is executed and delivered to PHCC
        and
        amounts are outstanding thereon, (ii) any date the Loan is prepaid and, (iii)
        the Scheduled Maturity Date.

       

      “Inventory”
        means all of the Provider’s (or other entities’, as applicable) inventory (as
        defined in the UCC) and all finished goods, other goods, merchandise and
        other
        personal property now owned or hereafter acquired by the Provider which are
        held
        for sale, lease, or rental or are furnished or to be furnished under a contract
        of service and all raw materials, work in process, component parts, materials
        or
        supplies used or to be used, or consumed or to be consumed, in the Provider’s
        business, and related products and all goods represented thereby, wherever
        located, and all such goods that may be reclaimed or repossessed from or
        returned by the Provider’s customers, and all shipping and packaging materials
        relating to any of the foregoing.

       

      “Loan”
means
        the Advances made by PHCC to Provider from time to time.

       

      “Loan
        Documents”
means
        the Agreement, the Note, and all other documents and instruments executed
        by the
        Provider in favor of or with PHCC in connection therewith.


      
        
          
          

        

        
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      “Lockbox”
has
        the
        meaning set forth in Section 4(a) of this Agreement.

       

      “Lockbox
        Account”
has
        the
        meaning set forth in Section 4(a) of this Agreement.

       

      “Material
        Adverse Effect”
or
        “Material
        Adverse Change”
means
        any event, condition or circumstance or set of events, conditions or
        circumstances or any change(s) which (i) has, had or could reasonably be
        expected to have any material adverse effect upon or change in the validity
        or
        enforceability of any Provider Agreement, (ii) has been or could reasonably
        be
        expected to be material and adverse to the value of any of the Collateral
        or to
        the business, operations, prospects, properties, assets, liabilities or
        condition of the Provider, or (iii) has materially impaired the ability of
        the
        Provider to perform its obligations under the Provider Agreements or to
        consummate the transactions thereunder. 

       

      “Maximum
        Aggregate Loan Amount”
means
        the maximum aggregate principal balance of the Loan outstanding at any time
        during the term of this Agreement, which amount shall not exceed the lesser
        of
        (i) the Commitment or (ii) the Availability Amount as determined by
        PHCC.

       

      “Maximum
        Rate”
means
        the maximum non-usurious rate of interest permitted by applicable law that
        at
        any time, or from time to time, may be contracted for, taken, reserved, charged
        or received on the debt in question or, to the extent that at any time
        applicable law may thereafter permit a higher maximum non-usurious rate of
        interest, then such higher rate. Notwithstanding any other provision hereof,
        the
        Maximum Rate shall be calculated on a daily basis (computed on the actual
        number
        of days elapsed over a year of 365 or 366 days, as the case may
        be).

       

      “Medicaid”
means
        the medical assistance program established by Title XIX of the Social Security
        Act, 42 U.S.C. Sections 1396 et seq., and any statutes succeeding
        thereto.

       

      “Medicare”
means
        the health insurance program established by Title XVIII of the Social Security
        Act, 42 U.S.C. Sections 1395 et seq., and any statutes succeeding
        thereto.

       

      “Medicare
        or Medicaid Receivable”
means
        a
        Healthcare Receivable representing a claim against a Governmental Entity
        pursuant to the Medicare program (as set forth in Title 42 U.S.C. Section
        1395
        et seq.) or the Medicaid program (as set forth in Title 42 U.S.C. Section 1396
        et seq.).

       

      “Monthly
        Commitment Fee”
means
        the Fee set forth in Section 2(d) of this Agreement.

       

      “Note”
has
        the
        meaning set forth in Section 2(b)(i) of this Agreement.

       

      “Net
        Value”
means,
        with respect to a Healthcare Receivable, the amount, determined by the Servicer
        or PHCC as of the date of such determination, as collectible from the Obligor
        on
        such Healthcare Receivable after giving effect to contractual allowances
        with
        respect thereto and any amounts determined by the Servicer or PHCC to be
        not
        collectible from the Obligor on that Healthcare Receivable.

       


      
        
          
          

        

        
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      “Obligations”
has
        the
        meaning set forth in Section 5(b) of this Agreement.

       

      “Obligor”
means
        an Eligible Obligor which is identified by the Provider as being obligated
        to
        make payment of all or a portion of a Healthcare Receivable.

       

      “Overadvance
        Fee”
has
        the
        meaning set forth in Section 2 of this Agreement.

       

      “Person”
means
        any individual, corporation, partnership, joint venture, association,
        joint-stock company, trust, unincorporated organization or government or
        any
        agency or political subdivision thereof (including, without limitation, any
        Governmental Entity) whether acting in an individual, fiduciary or other
        capacity.

       

      “PHCC”
has
        the
        meaning set forth in Section 1 of this Agreement.

       

      “Prepayment
        Amount”
has
        the
        meaning set forth in Section 2(b)(ii) of this Agreement.

       

      “Prepayment
        Fee”
has
        the
        meaning set forth in Section 11 of this Agreement

       

      “Proceeds”
        means all cash proceeds, non-cash proceeds and all forms of payment and other
        property received or due from the sale, lease, rental, transfer, disposition,
        licensing, collection, use or exchange of property constituting Collateral
        hereunder and any and all claims against any third party for loss of or damage
        to any Collateral, including insurance, contract and tort claims, and further,
        without limiting the generality of the foregoing, Proceeds shall include
        all
        Accounts, checks, cash, money orders, drafts, chattel paper, general
        intangibles, instruments, notes and other documents evidencing payment and
        payment obligations to Provider for the sale, lease, rental, transfer,
        disposition, licensing, collection, use or exchange of Collateral.

       

      “Provider
        Agreements”
means
        this Agreement, the Note, the Servicing Agreement, and each certificate,
        document or agreement executed or delivered by the Provider pursuant to any
        of
        the foregoing, each as amended or restated by the parties from time to
        time.

       

      “Records”
means
        all Contracts and other documents, information, books and other records
        maintained by the Provider or the Servicer with respect to Healthcare
        Receivables, the related Obligors and any other Collateral. “Records” shall
        include, but not be limited to, computer programs, tapes, disks, data processing
        software and related property and rights.

       

      “Reimbursable
        Expenses”
means
        the following expenses which are incurred in connection with this Agreement
        and/or the Healthcare Receivables: (i) $20 for each wire transfer; (ii) $12
        per
        package for overnight mail delivery; (iii) $15 per check for check
        certification; (iv) $3 per debtor for debtor notification; (v) any amounts
        payable under Sections 2(e) and 11 hereof; (vi) the internal costs to PHCC
        of
        any collateral audit performed by PHCC personnel; 

       


      
        
          
          

        

        
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      (vii)
        PHCC’s reasonable out-of-pocket expenses incurred in connection with the
        preparation, execution, delivery and administration of, and any amendment,
        supplement or modification to, this Agreement, the Note, the Control Agreement
        and the other Provider Agreements and any other documents prepared in connection
        herewith or therewith, and the consummation of the transactions contemplated
        hereby and thereby, including, without limitation, any and all lien search
        fees,
        collateral audit fees, credit inquiry and investigation fees and costs,
        healthcare consultant fees, and the fees and charges of counsel to PHCC,
        (viii)
        PHCC’s costs and expenses incurred in connection with the enforcement or
        preservation of any rights under this Agreement, the Note, the Control
        Agreement, the other Provider Agreements and any such other documents,
        including, without limitation, fees and charges of counsel to PHCC, and (ix)
        any
        and all recording and filing fees and any and all liabilities with respect
        to,
        or resulting from any delay in paying, any registration tax, stamp, duty
        and
        other similar taxes or duties, if any, which may be payable or determined
        to be
        payable in connection with the execution and delivery of, or consummation
        of any
        of the transactions contemplated by, or any amendment, supplement or
        modification of, or any waiver or consent under or in respect of, this
        Agreement, the Note, the other Provider Agreements and any such other
        documents.

       

      “Scheduled
        Maturity Date”
means
        the date that is three (3) years after the date the Agreement is entered
        into as
        shown in the first paragraph of the first page of the Agreement.

       

      “Servicer”
means
        Healthcare Claims Management Corporation acting in such capacity under the
        Servicing Agreement, and its successors and assigns.

       

      “Servicing
        Agreement”
means
        the Medical Claims Servicing Agreement dated of even date herewith, by and
        between the Provider and the Servicer and approved by PHCC, substantially
        in the
        form of Exhibit F of this Agreement, as amended and restated by the parties
        from
        time to time.

       

      “Social
        Security Act”
means
        the federal Social Security Act of 1935, as amended, as set forth in Title
        42,
        U.S.C.A.

       

      “State”
means
        any state of the United States of America, the District of Columbia and the
        Commonwealth of Puerto Rico.

       

      “Termination
        Fee”
means
        the fee set forth in Section 2(d) of this Agreement.

       

      “UCC”
has
        the
        meaning set forth in Section 5(a) of this Agreement.

       

      “Unused
        Line Fee”
        had the
        meaning set forth in Section 2(d) of this Agreement.

       

      “United
        States”
means
        the United States of America, its territories and possessions.

       

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