Document:

EX-10.2 Second Amendment to Loan Agreement

 

EXHIBIT 10.2

SECOND AMENDMENT TO LOAN AGREEMENT AND JOINDER

     This Second Amendment to Loan Agreement and Joinder (this “Amendment”), dated as of
March 14, 2008, is by and among DIVERSICARE PARIS, LLC, a Delaware limited liability company (the
“New Borrower”), those certain entities set forth on Schedule 1 hereto, which are
signatories hereto (such entities, collectively, the “Original Borrower” and together with
the New Borrower, individually and collectively, the “Borrower”), and LASALLE BANK NATIONAL
ASSOCIATION, a national banking association (together with its successors and assigns, the
“Lender”).

RECITALS

     A. Original Borrower and Lender are parties to that certain Loan Agreement dated as of August
10, 2007 as amended by First Amendment to Loan Agreement (the “First Amendment”) dated as of
December 18, 2007 (as amended, restated, supplemented and otherwise modified, the “Loan
Agreement”).

     B. The Original Borrower and Lender desire to amend certain terms and provisions of the Loan
Agreement on the terms and conditions set forth herein.

     C. The Lender desires that the New Borrower execute this Amendment for the purpose of
acknowledging that it is a Borrower under the Loan Agreement.

     NOW, THEREFORE, in consideration of the premises herein contained, and for other good and
valuable consideration (the receipt, sufficiency and adequacy of which are hereby acknowledged),
the parties hereto (intending to be legally bound) hereby agree as follows:

     1. Definitions. Terms capitalized herein and not otherwise defined herein shall have
the meanings ascribed to such terms in the Loan Agreement, as amended hereby.

     2. Joinder and Assumption. From and after the date hereof, New Borrower hereby
absolutely and unconditionally (i) joins as and becomes a party to the Loan Agreement as a Borrower
thereunder, (ii) assumes, as a joint and several obligor thereunder, all of the obligations,
liabilities and indemnities of a Borrower under the Loan Agreement and all other Financing
Agreements (including, without limitation, the Liabilities), and (iii) covenants and agrees to be
bound by and adhere to all of the terms, covenants, waivers, releases, agreements and conditions of
or respecting the Borrower with respect to the Loan Agreement and each other Financing Agreements
and all of the representations and warranties contained in the Loan Agreement and the other
Financing Agreements. From and after the date hereof, any reference to the term “Borrower” in the
Loan Agreement and each other Financing Agreement shall also include the New Borrower.

     3. Amendments to Loan Agreement. Subject to the terms and conditions contained
herein, the Borrower and the Lender hereby amend the Loan Agreement as follows:

 

 

          (a) The definition of “Omega Master Lease Agreement” set forth in Section 1.1 of the Loan
Agreement is hereby amended to (i) delete the word “and” immediately preceding clause (e) thereof
and (ii) add the following new clauses (f) immediately following such clause (e): “and (f) that
certain Sixth Amendment to Consolidated, Amended and Restated Master Lease dated as of March 14,
2008, by and between DLC and Omega.”

          (b) The definition of “Adjusted Leased Asset EBITDA” set forth in Section 1.1 of the Loan
Agreement, as amended and restated in the First Amendment, is hereby further amended to add the
following sentence to that definition:

“For purposes of determining Adjusted Leased Asset EBITDA, overhead costs of
Diversicare Management Services, Co. and Parent shall be allocated on the basis of
revenues of the Leased Assets in proportion to total consolidated revenues.”

          (c) The definition of “Leased Asset Adjusted EBITDA” currently set forth in Section 1.1 of the
Loan Agreement is hereby deleted.

          (d) Section 12.12 of the Loan Agreement is hereby amended to delete the contact information
for Lender and substitute in lieu thereof the following new contact information:

Bank of America, N.A.

414 Union Street

Nashville, Tennessee

Attention: Gail Banasiak

Telephone No.: (615) 749-4607

Facsimile No.: (615) 749-4951

          (e) Schedule 1 of the Loan Agreement is hereby amended to include the following new final row
in the table set forth therein:

	 	 	 	 	 	 	 	 	 
	Diversicare Paris, LLC
	 	Delaware limited	 	1621 Galleria Boulevard
	 
	 	liability company	 	Brentwood, TN  37027

          (f) Schedule 1.1(a) of the Loan Agreement is hereby amended to include a reference to (i)
“Parkview Care Center” and (ii) “Paris Healthcare and Rehabilitation Center or such other name(s)
as communicated in writing by the Borrower to the Lender” under the “Texas” heading.

          (g) The first paragraph of Schedule 1.1(e) of the Loan Agreement is hereby amended to delete
the reference to “and as further amended by that certain Fifth Amendment to Consolidated Amendment,
Amended and Restated Master Lease dated as of August 10, 2007” and substitute in lieu thereof a
reference to “, as further amended by that certain Fifth Amendment to Consolidated Amendment,
Amended and Restated Master Lease dated as of August 10, 2007 and as further amended by that
certain Sixth Amendment to Consolidated Amendment, Amended and Restated Master Lease dated as of
March 14, 2008 (the ‘Sixth Amendment’).”

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          (h) Section (b) of Schedule 1.1(e) of the Loan Agreement is hereby amended to delete the
reference to “August 3, 2007” and substitute in lieu thereof a reference to “August 3, 2007, as
amended by that certain First Amendment to Master Sublease dated ___, 2009 (adding Paris
Healthcare and Rehabilitation Center, or such other name(s) as communicated to the Lender by
Borrower in writing).”

          (i) Section (b) of Schedule 1.1(e) of the Loan Agreement is hereby further amended to include
the following new clause (viii):

	 	“(viii)	 	Sublease dated ___, 2009, by Diversicare Texas I, LLC, as Master
Sublessor, and Diversicare Paris, LLC, as Sublessee, with respect to the Paris
Healthcare and Rehabilitation Center (or such other name(s) as communicated in
writing by the Borrower to the Lender).”

          (j) Schedule 1.1(e) of the Loan Agreement is hereby further amended to include the following
new paragraphs 3 and 4:

“3. Single Facility Lease (Paris, Texas) dated October 31, 2007 by and between Long
Term Care Associates–Texas, Inc., a Texas corporation, as Lessor, and New Borrower,
as Lessee, as amended by First Amendment to Single Facility Lease (Paris, Texas)
dated March 14, 2008.

4. Lease Agreement dated as of March 18, 2005 by and between Health Care Ventures,
Inc., as Lessor, and Diversicare Leasing Corp., as Lessee, for Martin Health Care in
Martin, Tennessee.”

     (k) Schedule 7.8 of the Loan Agreement is hereby amended to include the following references
in appropriate alphabetical order:

“Diversicare Paris, LLC (i) is qualified to do business, and does business, as a
foreign limited liability company in the State of Texas under the name ‘Parkview
Care Center’ and, (ii) if Borrower delivers written notice to the Lender that it
intends for Diversicare Paris, LLC to do business under another name (or other
names) upon execution of the Sixth Amendment by the parties thereto or thereafter,
will be qualified to do business under such other name(s).”

     4. Conditions Precedent. The amendments contained in Section 3 hereof are subject to,
and contingent upon, the prior or contemporaneous satisfaction of the following conditions
precedent:

          (a) The Borrower and Lender shall have executed and delivered to each other this Amendment,

          (b) The Borrower and Lender shall have executed and delivered to each other that certain
Joinder No. 1 to Revolving Loan Note of even date herewith.

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          (c) The Borrower, Lender and Sterling Acquisition Corp., a Kentucky corporation, shall have
amended the Omega-Sterling Intercreditor Agreement in form and substance reasonably satisfactory to
the Lender, and

          (d) The Borrower shall have delivered to the Lender correct and complete copies of the
resolutions of the Borrower Agent authorizing or ratifying the execution, delivery and performance
by the Borrower of this Amendment.

     5. Acknowledgment; Post-Amendment Deliveries.

          (a) Promptly upon execution thereof, but in any event, on or before April 30, 2008, the
Borrower shall have delivered to the Lender correct and complete copies of the Sixth Amendment to
Consolidated Amendment, Amended and Restated Master Lease by and between DLC and Omega.

          (b) Promptly upon execution thereof, the Borrower shall deliver to the Lender correct and
complete copies of the Sublease by Diversicare Texas I, LLC, as Master Sublessor, and Diversicare
Paris, LLC, as Sublessee, with respect to the Paris Healthcare and Rehabilitation Center or such
other facility name(s) as communicated in writing by the Borrower to the Lender (as amended,
restated, supplemented or otherwise modified from time to time, the “Paris Sublease” and
the facility subleases thereunder, the “New Paris Facility”).

          (c) Borrower and Lender acknowledge and agree (i) that upon execution thereof by the parties
thereto, the Paris Sublease will be a Commercial Lease and Restricted Agreement; (ii) that certain
Single Facility Lease dated October 31, 2007 (as amended, restated, supplemented or otherwise
modified from time to time, the “Single Facility Lease”) by and between Long Term Care
Associates – Texas, Inc., a Texas corporation, and New Borrower is a Commercial Lease and a
Restricted Agreement and (iii) that ninety (90) days following the completion of construction and
licensing of the New Paris Facility for its intended use as a skilled nursing facility, the Single
Facility Lease shall be terminated and of no further force or effect, if not sooner terminated by
the parties thereto.

     6. Reference to and Effect on the Loan Agreement.

          (a) Except as expressly provided herein, the Loan Agreement and all of the other Financing
Agreements shall remain unmodified and continue in full force and effect and are hereby ratified
and confirmed.

          (b) Except as expressly provided herein, the execution, delivery and effectiveness of this
Amendment shall not operate as a waiver of: (i) any right, power or remedy of the Lender under the
Loan Agreement or any of the other Financing Agreements, or (ii) any Default or Event of Default
under the Loan Agreement.

     7. Costs, Expenses and Taxes. Without limiting the obligation of the Borrower to
reimburse the Lender for costs, fees, disbursements and expenses incurred by the Lender as
specified in the Loan Agreement, the Borrower agrees to pay on demand all reasonable costs, fees,
disbursements and expenses of the Lender in connection with the preparation, execution and delivery
of this Amendment and the other agreements, instruments and documents

4

 

contemplated hereby, including, without limitation, reasonable attorneys’ fees and
out-of-pocket expenses.

     8. Representations and Warranties of the Borrower. The Borrower hereby represents and
warrants to the Lender, which representations and warranties shall survive the execution and
delivery hereof, that on and as of the date hereof and after giving effect to this Amendment:

          (a) The Borrower has the requisite power and authority to execute, deliver and perform its
obligations under this Amendment. This Amendment has been duly authorized by all necessary action
of the Borrower. This Amendment constitutes the legal, valid and binding obligation of the
Borrower, enforceable against the Borrower in accordance with its terms, subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar law affecting creditors’ rights
generally and general principles of equity;

          (b) The Borrower’s representations contained in Section 7 of the Loan Agreement are true and
correct in all material respects (without duplication of materiality) on and as of the date hereof
(unless expressly related to an earlier date, in which case such representations shall be true and
correct as of such earlier date); and

          (c) No Default or Event of Default has occurred and is continuing.

     9. Reference to Loan Agreement; No Waiver.

          (a) Upon the effectiveness of this Amendment, each reference in the Loan Agreement to “this
Loan Agreement,” “this Agreement,” “hereunder,” “hereof,” “herein” or words of like import shall
mean and be a reference to the Loan Agreement as amended hereby. The term “Financing Agreements”
as defined in Section 1.1 of the Loan Agreement shall include (in addition to the Financing
Agreements described in the Loan Agreement) this Amendment and any other agreements, instruments or
other documents executed in connection herewith.

          (b) The Lender’s failure, at any time or times hereafter, to require strict performance by the
Borrower of any provision or term of the Loan Agreement, this Amendment or the other Financing
Agreements shall not waive, affect or diminish any right of the Lender hereafter to demand strict
compliance and performance herewith or therewith. Any suspension or waiver by the Lender of a
breach of this Amendment or any Event of Default under the Loan Agreement shall not, except as
expressly set forth herein, suspend, waive or affect any other breach of this Amendment or any
Event of Default under the Loan Agreement, whether the same is prior or subsequent thereto and
whether of the same or of a different kind or character. None of the undertakings, agreements,
warranties, covenants and representations of the Borrower contained in this Amendment, shall be
deemed to have been suspended or waived by the Lender unless such suspension or waiver is: (i) in
writing and signed by the Lender, and (ii) delivered to the Borrower. In no event shall the
Lender’s execution and delivery of this Amendment establish a course of dealing among the Lender,
the Borrower or any other obligor or in any other way obligate the Lender to hereafter provide any
amendments or waivers with respect to the Loan Agreement. The terms and provisions of this
Amendment shall be limited precisely as written and shall not be deemed: (A) to be a consent to a
modification (except as expressly

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 provided herein) or waiver of any other term or condition of the Loan Agreement or of any
other Financing Agreement, or (B) to prejudice any right or remedy that the Lender may now have
under or in connection with the Loan Agreement or any of the other Financing Agreements.

     10. Successors and Assigns. This Amendment shall be binding upon and inure to the
benefit of the Lender and each of the other parties hereto and their respective successors and
assigns; provided, however, the Borrower may not assign this Amendment or any of the Borrower’s
rights hereunder without the Lender’s prior written consent. Any prohibited assignment of this
Amendment shall be absolutely null and void. This Amendment may only be amended or modified by a
writing signed by the Lender and the Borrower.

     11. Severability. Wherever possible, each provision of this Amendment shall be
interpreted in such a manner so as to be effective and valid under applicable law, but if any
provision of this Amendment is held to be prohibited by or invalid under applicable law, such
provision or provisions shall be ineffective only to the extent of such provision and invalidity,
without invalidating the remainder of this Amendment.

     12. Governing Law. This Amendment shall be deemed to be a contract made under the
laws of the State of Illinois, and the rights and obligations of the parties hereunder shall be
construed in accordance with and be enforced and governed by the internal laws of the State of
Illinois, without regard to conflict of law or choice of law principles.

     13. Counterparts; Facsimile or Other Electronic Transmission. This Amendment may be
executed in one or more counterparts, each of which taken together shall constitute one and the
same instrument. Delivery of an executed counterpart of this Amendment by telefacsimile or other
electronic transmission shall be equally as effective as delivery of a manually executed
counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by
telefacsimile or other electronic transmission shall also deliver a manually executed counterpart
of this Amendment, but the failure to deliver a manually executed counterpart shall not affect the
validity, enforceability or binding effect of this Amendment.

***Signature Page Follows***

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IN WITNESS WHEREOF, the undersigned have caused this Second Amendment to Loan Agreement and Joinder
to be duly executed and delivered as of the date first above written.

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	BORROWER:
	 
	 	 	 	 	 	 
	 	 	DIVERSICARE MANAGEMENT
SERVICES CO., a Tennessee corporation,
as Borrower Agent
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	ADVOCAT ANCILLARY SERVICES,
INC., a Tennessee corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	ADVOCAT FINANCE, INC., a Delaware
corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DIVERSICARE MANAGEMENT
SERVICES CO., a Tennessee corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 

7

 

	 	 	 	 	 	 	 
	 	 	ADVOCAT DISTRIBUTION
SERVICES, INC., a Tennessee corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DIVERSICARE ASSISTED LIVING
SERVICES, INC., a Tennessee corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DIVERSICARE ASSISTED LIVING

SERVICES NC, LLC, a Tennessee limited

liability company
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	DIVERSICARE LEASING CORP., a
Tennessee corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 
	 
	 	 	 	 	 	 
	 	 	STERLING HEALTH CARE
MANAGEMENT, INC., a Kentucky corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Glynn Riddle	 	 
	 

	 	Its:
	 	Executive Vice President & Chief Financial

Officer	 	 

8

 

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SENIOR CARE CEDAR HILLS, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	SENIOR CARE FLORIDA LEASING,

LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	BY:
	 	DIVERSICARE LEASING
CORP., its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SENIOR CARE GOLFCREST, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	SENIOR CARE FLORIDA LEASING,

LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	BY:
	 	DIVERSICARE LEASING
CORP., its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SENIOR CARE GOLFVIEW, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	SENIOR CARE FLORIDA LEASING,

LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	BY:
	 	DIVERSICARE LEASING
CORP., its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 

9

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SENIOR CARE FLORIDA LEASING,

LLC, a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	SENIOR CARE SOUTHERN PINES,

LLC, a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	SENIOR CARE FLORIDA LEASING,

LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	BY:
	 	DIVERSICARE LEASING
CORP., its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE AFTON OAKS, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 

10

 

	 	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE ASSISTED LIVING

SERVICES NC I, LLC, a Delaware limited

liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE ASSISTED LIVING

SERVICES NC, LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE ASSISTED LIVING

SERVICES NC II, LLC, a Delaware limited

liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE ASSISTED LIVING

SERVICES NC, LLC, its sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE BRIARCLIFF, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 

11

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE CHISOLM, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE HARTFORD, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE HILLCREST, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE LAMPASAS, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:DIVERSICARE LEASING CORP., its
sole
member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 

12

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE PINEDALE, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE WINDSOR HOUSE,

LLC, a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE YORKTOWN, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:DIVERSICARE LEASING CORP., its
sole
member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 

13

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE BALLINGER, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE DOCTORS, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE ESTATES, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE HUMBLE, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 

14

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE KATY, LLC, a Delaware

limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:	 	Executive Vice President & Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE NORMANDY

TERRACE, LLC, a Delaware limited

liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:	 	Executive Vice President & Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE TEXAS I, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:	 	Executive Vice President & Chief Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE TREEMONT, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:	 	Executive Vice President & Chief Financial Officer	 	 

15

 

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE ROSE TERRACE, LLC,

a Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE LEASING CORP., its
sole member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	DIVERSICARE PARIS, LLC, a

Delaware limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	BY:	 	DIVERSICARE TEXAS I, LLC, its sole

member	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Glynn Riddle	 	 
	 

	 	 	 	Name:
	 	Glynn Riddle	 	 
	 

	 	 	 	Its:
	 	Executive Vice President & Chief

Financial Officer	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	LENDER:	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	LASALLE BANK NATIONAL ASSOCIATION	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	Bank of America, N.A.	 	 
	 

	 	 	 	Its:	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Khuzaim Shakir	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Khuzaim Shakir	 	 
	 

	 	 	 	 	 	Senior Vice President	 	 

16

 

SCHEDULE 1

2. BORROWERS

Advocat Ancillary Services, Inc.

Advocat Finance, Inc.

Diversicare Management Services Co.

Advocat Distribution Services, Inc.

Diversicare Assisted Living Services, Inc.

Diversicare Assisted Living Services NC, LLC

Diversicare Leasing Corp.

Sterling Health Care Management, Inc.

Senior Care Cedar Hills, LLC

Senior Care Golfcrest, LLC

Senior Care Golfview, LLC

Senior Care Florida Leasing, LLC

Senior Care Southern Pines, LLC

Diversicare Afton Oaks, LLC

Diversicare Assisted Living Services NC I, LLC

Diversicare Assisted Living Services NC II, LLC

Diversicare Briarcliff, LLC

Diversicare Chisolm, LLC

Diversicare Hartford, LLC

Diversicare Hillcrest, LLC,

Diversicare Lampasas, LLC

Diversicare Pinedale, LLC

Diversicare Windsor House, LLC

Diversicare Yorktown, LLC

Diversicare Ballinger, LLC

Diversicare Doctors, LLC

Diversicare Estates, LLC

Diversicare Humble, LLC

Diversicare Katy, LLC

Diversicare Normandy Terrace, LLC

Diversicare Texas I, LLC

Diversicare Treemont, LLC

Diversicare Rose Terrace, LLCEX-10.1 NON EMPLOYEE DIRECTOR FEE PLAN

 

Exhibit 10.1

SYKES ENTERPRISES, INCORPORATED

FIRST AMENDED AND RESTATED

2004 NONEMPLOYEE DIRECTOR FEE PLAN

ARTICLE I. DEFINITIONS

     1.1 DEFINITIONS. Whenever the following terms are used in this Plan they shall have the
meanings specified below unless the context clearly indicates to the contrary:

     (a) “Board”: The Board of Directors of the Company.

     (b) “Common Stock”:
The Company’s Common Stock, par value $.01 per share.

     (c) “Common Stock
Unit”: A bookkeeping entry that records the equivalent of one Share.

     (d) “Company”: Sykes
Enterprises, Incorporated or any successor or successors thereto.

     (e) “Nonemployee Director”: An
individual duly elected or chosen as a Director of the Company
who is not also an employee of the Company or its subsidiaries.

     (f) “Plan”: The Plan set forth in this instrument as it may, from time to time, be amended.

     (g) “Share”: A fully paid, non-assessable share of Common Stock.

ARTICLE II. PURPOSE

     The purpose of this Plan is to secure for the Company and its shareholders the benefits of the
incentive inherent in increased ownership of Common Stock of the Company by members of the Board of
Directors of the Company who are not employees of the Company or any of its Subsidiaries, by
providing for the payment of a portion of each Nonemployee Director’s compensation in Common Stock.
It is expected that such ownership will further align the interests of such Nonemployee Directors
with the shareholders of the Company, thereby promoting the long-term profits and growth of the
Company, and will encourage such Nonemployee Directors to remain directors of the Company and
provide them with the benefits of deferring the receipt of some of such compensation. It is also
expected that the Plan will encourage qualified persons to become directors of the Company.

ARTICLE III. INITIAL GRANT OF COMMON STOCK UNITS

     In consideration of joining the Board, upon the initial election of a Nonemployee Director to
the Board, such Non-employee Director shall receive an award of Common Stock Units. The number of
Common Stock Units shall be determined by dividing a dollar amount to be determined from time to
time by the Board (initially set at $30,000) by an amount equal to 110% of the average closing
prices of the Company’s common
stock for the five trading days prior to the date the Nonemployee Director is elected (but in any
event, not less than the closing price of

 

 

the Company’s common stock on the date of grant), rounded to the nearest whole number of Common
Stock Units. The initial grant of Common Stock Units will vest in twelve equal quarterly
installments, one-twelfth on the date of each of third month following the date of grant. All
unvested Common Stock Units remaining will lapse in the event the Non-employee Director ceases to
be a Director of the Company.

ARTICLE IV. ANNUAL RETAINER FEE

     In consideration of their services as members of the Board, each Nonemployee Director shall be
entitled to receive an annual retainer fee in such amount as shall be determined from time to time
by the Board (initially set at $50,000). The annual retainer fee shall be payable in advance on the
day after the annual shareholders’ meeting in such year and shall be paid 25% in cash and 75% in
Common Stock Units. The number of Common Stock Units shall be determined by dividing 75% of the
amount of the annual retainer fee by an amount equal to 105% of the average of the closing prices
for the Company’s common stock on the five trading days preceding the award date (but in any event,
not less than the closing price of the Company’s common stock on the date of grant), rounded to the
nearest whole number of Common Stock Units. The annual grant of Common Stock Units will vest in
eight equal quarterly installments, one-eighth on the date of each of third month following the
date of grant. All unvested Common Stock Units remaining will lapse in the event the Non-employee
Director ceases to be a Director of the Company. The provision in this Article IV for the payment
of an annual retainer fee to Nonemployee Directors shall not limit the ability of the Board to
provide for additional compensation payable to Nonemployee Directors for services on behalf of the
Board over and above those typically expected of Directors, including serving as Chair of a Board
committee.

ARTICLE V. ISSUANCE OF SHARES OF COMMON STOCK

FOR COMMON STOCK UNITS.

     Upon the vesting of Common Stock Units, the Nonemployee Director shall be entitled to receive
for each vested Common Stock Unit one Share, and the vested Common Stock Units shall be canceled.
The Company shall cause a certificate representing such Shares to be issued to the Nonemployee
Director promptly following the vesting of the Common Stock Units.

ARTICLE VI. ADMINISTRATION, AMENDMENT AND TERMINATION

     6.1 ADMINISTRATION. The Plan shall be administered by the Board. The Board shall have such
powers as may be necessary to discharge its duties hereunder. The Board may, from time to time,
employ agents and delegate to them such administrative duties as it sees fit, and may from time to
time consult with legal counsel who may be
counsel to the Company. All decisions and determinations by the Board shall be final and binding on
all parties.

     6.2 AMENDMENT AND TERMINATION. The Board may alter or amend this Plan from time to time or may
terminate it in its entirety; provided, however, that no such action shall, without the consent of
a Nonemployee Director, affect the rights in any Common Stock Units issued to such Nonemployee
Director; and further provided, that, any amendment which must be

 

 

approved by the shareholders of the Company in order to comply with applicable law or the rules of
any national securities exchange or securities listing service upon which the Shares are traded or
quoted shall not be effective unless and until such approval is obtained. Presentation of the Plan
or any amendment thereof for shareholder approval shall not be construed to limit the Company’s
authority to offer similar or dissimilar benefits in plans that do not require shareholder
approval.

     6.3 ADJUSTMENTS. In the event of any change in the outstanding Common Stock by reason of (a)
any stock dividend, stock split, combination of shares, recapitalization or any other change in the
capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out,
split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance
of rights or warrants to purchase securities, or (c) any other corporate transaction or event
having an effect similar to any of the foregoing, the number or kind of Shares that may be issued
under the Plan and the number of Common Stock Units credited to a Nonemployee Director
automatically shall be adjusted so that the proportionate interest of the Nonemployee Directors
shall be maintained as before the occurrence of such event. Such adjustment shall be conclusive and
binding for all purposes with respect to the Plan.

     6.4 SUCCESSORS. The Company shall require any successor (whether direct or indirect, by
purchase, merger, consolidation, reorganization or otherwise) to all or substantially all of the
business and/or assets of the Company expressly to assume and to agree to perform this Plan in the
same manner and to the same extent the Company would be required to perform if no such succession
had taken place. This Plan shall be binding upon and inure to the benefit of the Company and any
successor of or to the Company, including without limitation any persons acquiring directly or
indirectly all or substantially all of the business and/or assets of the Company whether by sale,
merger, consolidation, reorganization or otherwise (and such successor shall thereafter be deemed
the “Company” for the purpose of this Plan), and the heirs, beneficiaries, executors and
administrators of each Nonemployee Director.

ARTICLE VII. SHARES SUBJECT TO PLAN

     Subject to adjustment as provided in this Plan, the total number of Shares of Common Stock
which may be issued under this Plan shall be Four Hundred Fifty Thousand (450,000). Shares may be
shares of original issuance or treasury shares or a combination of the foregoing.

ARTICLE VIII. EFFECTIVE DATE; APPROVAL BY SHAREHOLDERS

     The Plan is effective as of May 6, 2004, and was approved by the shareholders of the Company
at the 2005 annual shareholders’ meeting.

ARTICLE IX. GENERAL PROVISIONS

     9.1 NO CONTINUING RIGHT TO SERVE AS A DIRECTOR. Neither the adoption or of this Plan, nor any
document describing or referring to this Plan, or any part thereof, shall confer upon any
Nonemployee Director any right to continue as a director of the Company or any subsidiary of the
Company.

 

 

     9.2 RIGHTS AS A SHAREHOLDER. Until the vesting of a Common Stock Unit, a Nonemployee Director
shall have none of the rights of a shareholder with respect to his or her Common Stock Units. Upon
the vesting of a Common Stock Unit, the Nonemployee Director shall have the right to receive a
Share for such Common Stock Unit, shall be deemed to be the owner of such Share which shall be
deemed to be issued and outstanding, and shall have all of the rights of a shareholder with respect
to such Share.

     9.3 GOVERNING LAW. The provisions of this Plan shall be governed by construed in accordance
with the laws of the State of Florida.

     9.4 WITHHOLDING TAXES. To the extent that the Company is required to withhold Federal, state
or local taxes in connection with any component of a Nonemployee Director’s compensation in cash or
Shares, and the amounts available to Company for such withholding are insufficient, it shall be a
condition the receipt of any Shares that the Nonemployee Director make arrangements satisfactory to
the Company for the payment of the balance of such taxes required to be withheld, which arrangement
may include relinquishment of the Shares. The Company and a Nonemployee Director may also make
similar arrangements with respect to payment of any other taxes derived from or related to the
payment of Shares with respect to which withholding is not required.

     9.5 MISCELLANEOUS. Headings are given to the sections of this Plan as a convenience to
facilitate reference. Such headings, numbering and paragraphing shall not in any case be deemed in
any way material or relevant to the construction of this Plan or any provisions thereof. The use of
the singular shall also include within its meaning the plural, and vice versa.

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