Document:

Amendment No. 16 to Contract effective 10/1/2006

 

	 	 	 
	

	 	ARIZONA HEALTH CARE COST CONTAINMENT SYSTEM ADMINISTRATION

DIVISION OF BUSINESS AND FINANCE

CONTRACT AMENDMENT

	 	 	 	 	 	 	 
	1. AMENDMENT NO.:
	 	2. CONTRACT NO.:
	 	3. EFFECTIVE DATE OF AMENDMENT:
	 	4. PROGRAM:
	16
	 	YH04-0001-03
	 	October 1, 2006
	 	DHCM

5. CONTRACTOR/PROVIDER NAME AND ADDRESS:

Health Choice Arizona

1600 W. Broadway, Suite 260

Tempe, Arizona 85282-1136

6. PURPOSE:

          To amend Sections B and D as listed below.

7. The above referenced contract is hereby amended as follows:

	 	A.	 	SECTION B, CAPITATION RATES:
	 
	 	 	 	See rate sheet attached for the revised capitation rates effective October 1, 2006
through December 31, 2006 and the amounts to be paid to the rural hospitals.
	 
	 	 	 	Insert the following language before “See attached.”:
	 
	 	 	 	“The Contractor will be paid the attached Contractor specific capitation rates
retroactively, per member per month, for the period of October 1, 2006 through December
31, 2006. Only the impacted rates are included on the attachment. All other rates
remain unchanged. The Administration requires that the Contractor then make one-time
payments to each rural hospital as prescribed on the attached schedule, pursuant to ARS
§ 36-2905.02, to increase inpatient reimbursement to these small rural hospitals.
	 
	 	 	 	The retroactive capitation rate payment will be paid in June 2007. The Contractor shall
make the prescribed payments to the rural hospitals by June 30, 2007 and submit proof
of payment to the rural hospitals to the Finance Unit of the Division of Health Care
Management by July 20, 2007.
	 
	 	 	 	The capitation rates for the period January 1, 2007 through September 30, 2007 are
not impacted by this amendment.”
	 
	 	B.	 	SECTION D, Paragraph 2, ELIGIBILITY CATEGORIES:
	 
	 	 	 	To include the coverage of behavioral health services under the SSDI-TMC
program, replace the last subparagraph, which begins “In order to participate
in SSDI-TMC...”, with:
	 
	 	 	 	In order to participate in SSDI-TMC, eligible persons must pay a premium. Participants
become ineligible for SSDI-TMC once they become eligible for Medicare. SSDI-TMC is
funded entirely by the State. Contractors will be capitated for these members under
unique rate codes and AHCCCS may provide a reconciliation to limit the profit or loss
of this population. If a reconciliation is to be implemented, an SSDI-TMC
reconciliation policy will be developed which will discuss the details of the
reconciliation calculations and timelines. SSDI-TMC members will not be eligible for
prior period coverage, any supplemental payments or reinsurance. Members will be
entitled to all AHCCCS Acute Care benefits.
	 
	 	C.	 	SECTION D, Paragraph 3, ENROLLMENT AND DISENROLLMENT:
	 
	 	 	 	To clarify the Contractor’s responsibility for coverage of behavioral health
services in the Prior Period, replace the subparagraph titled Prior Period Coverage
with:
	 
	 	 	 	Prior Period Coverage: AHCCCS provides prior period coverage for the period of time, prior to the
Title XIX member’s enrollment, during which a member is eligible for covered services. The time
frame is from the effective date of eligibility to the day a member is enrolled with
the Contractor. The Contractor receives

 

			
	NOTE: Please sign and date both and return one original to:	 	Phil Baldwin

AHCCCS Contracts
and Purchasing
 701
E. Jefferson, MD
5700
 Phoenix, AZ
85034

	8.	 	EXCEPT AS PROVIDED FOR HEREIN, ALL TERMS AND CONDITIONS OF THE ORIGINAL
CONTRACT NOT HERETOFORE CHANGED AND/OR AMENDED REMAIN UNCHANGED AND IN FULL
EFFECT.
	 
	 	 	IN WITNESS WHEREOF THE PARTIES HERETO SIGN THEIR NAMES IN AGREEMENT.

	 	 	 
	9.  NAME OF CONTRACTOR:
HEALTH CHOICE ARIZONA

	 	10.    ARIZONA HEALTH CARE COST CONTAINMENT 

          SYSTEM
	 
	 	 
	SIGNATURE OF AUTHORIZED INDIVIDUAL: /s/ Carolyn Rose

	 	SIGNATURE: /s/ Michael Veit
	 
	 	 
	TYPED NAME: CAROLYN ROSE

	 	TYPED NAME: MICHAEL VEIT
	 
	 	 
	TITLE: CHIEF EXECUTIVE OFFICER

	 	TITLE: CONTRACTS AND PURCHASING 

                ADMINISTRATOR
	 
	 	 
	DATE 4/30/07

	 	DATE: APR 19 2007EX-10.14

 

Exhibit 10.14

February 6, 2007

Ms. Cynthia A. Mahl, Senior Vice President

Western Reserve Bancorp, Inc.

4015 Medina Road

Medina, Ohio 44258-0585

Re: Loan Covenant Waiver for September 30, 2006 — Western Reserve Bancorp, Inc.

Dear Ms. Mahl:

This letter is being written as acknowledgement between the borrower and the bank that the existing
loans to borrower were in violation of covenant 4.16(e) of the Credit Agreement dated May 5, 2003
and subsequent amendments. The covenant reads as follow: Western Reserve Bank shall maintain a
ratio of Allowance for loan and lease losses to Non-performing Loans of not less than 125% at all
times. Actual Allowance for loan and lease losses to Non-performing Loans was 94.2% at September
30, 2006.

TCF Bank approved the waiver of default on 12-12-06 and hereby waives the default for
non-compliance of this covenant. TCF Bank further resets the covenant as follows: Western Reserve
Bank shall maintain a ratio of Allowance for loan and lease losses to Non-performing Loans of not
less than 90% through December 31, 2006 and to 100% thereafter. By acknowledging this letter,
Western Reserve Bank agrees to provide a reserve analysis on a quarterly basis by the
45th day following each fiscal quarter. TCF Bank does retain all our rights in future
covenant requirements. This waiver and reset pertains only to the above-mentioned covenant. All
other terms and conditions are to remain unchanged.

Kindly acknowledge your agreement with the foregoing by countersigning a copy of this letter.

	 	 	 	 	 
	 	Sincerely,

TCF National Bank

 	 
	 	/s/ Guy J. Rau
 	 
	 	Guy J. Rau 	 
	 	Senior Vice President 	 
	 

	 	 	 	 	 
	Understood, accepted and agreed:

Western Reserve Bancorp, Inc., an Ohio corporation

 	 	 
	By:  	/s/ Edward J. McKeon
 	 	 
	 	Edward J. McKeon 	 	 
	 	Its: President 	 	 
	 
	And

 	 	 
	By:  	                     /s/ Cynthia A. Mahl
 	 	 
	 	Cynthia A. Mahl 	 	 
	 	Its:  Senior Vice President	 	 
	 
	Date: 	February 12, 2007EX-10.15

 

	 	 	 	 	 

Exhibit 10.15

FIFTH AMENDMENT

TO LOAN AGREEMENT

AND WAIVER

     THIS FIFTH AMENDMENT TO LOAN AGREEMENT AND WAIVER (this “Amendment”) is made and
entered into as of June 21, 2007 by and between WESTERN RESERVE BANCORP, INC., an Ohio corporation
(the “Borrower”) and TCF NATIONAL BANK, a national banking association (the
“Bank”).

RECITALS:

          A. The Borrower and the Bank are parties to a certain letter loan agreement dated as of May 5,
2003, as amended by a certain First Amendment to Loan Agreement dated as of March 31, 2005, as
further amended by a certain Second Amendment to Loan Agreement dated as of June 30, 2005, as
further amended by a certain Third Amendment to Loan Agreement dated as of July 20, 2006, and as
further amended by a certain letter agreement dated as of February 6, 2007 (as amended, the
“Loan Agreement”). All capitalized terms not otherwise defined herein shall have the
meanings given to them in the Loan Agreement.

          B. The Borrower has requested that the Bank waive the Borrower’s non-compliance with
Section 4.16(e) of the Loan Agreement and modify the Loan Agreement to (i) extend the
Maturity Date of the existing $3,000,000 revolving line of credit and $1,000,000 revolving line of
credit from June 30, 2008 to September 30, 2008, and (ii) decrease the required ratio of Allowance
for loan and lease losses to Non-performing Loans from 100% to 85%.

          C. The Bank has agreed to make said modifications upon the terms and subject to the conditions
herein set forth.

AGREEMENTS:

     NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth,
and for other good and valuable consideration, the nature, receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

          Section 1. Conditions Precedent. The effectiveness of all of the amendments and
agreements set forth in this Amendment are subject to condition precedent that the Bank shall have
received all of the following items, each dated such date and in form and substance satisfactory to
the Bank, and each duly executed by all appropriate parties:

     (a) This Amendment.

     (b) A certificate of the secretary or an assistant secretary of the Borrower,
certifying: (i) the names of the officers of the Borrower authorized to sign this Amendment
and the other documents delivered or to be delivered in connection herewith to which the
Borrower is a party or by which it is bound, (ii) that the Articles of Incorporation and
Bylaws of the Borrower have not been amended, modified, supplemented or restated since the
date such documents were last certified to the Bank, and (iii) a copy of the resolutions of
the Board of Directors of the Borrower authorizing the execution, delivery and performance
by the Borrower of this Amendment and any other documents delivered or to be delivered in
connection herewith to which the Borrower is a party or by which it is bound, together with
all documents evidencing other necessary corporate action.

 

 

     (c) Such other documents or instruments as the Bank may reasonably require.

          Section 2. Waiver. Pursuant to Section 4.16(e) of the Loan Agreement, the
Borrower is required to maintain a ratio of Allowance for loan and lease losses to Non-performing
Loans of not less than 100% at all times after December 31, 2006. The Borrower has informed the
Bank that the actual ratio of Allowance for loan and lease losses to Non-performing Loans as of
March 31, 2007 was 94.92%. The Borrower has requested that the Bank waive its failure to comply
with Section 4.16(e) of the Loan Agreement as of said measurement date. Subject to the
full satisfaction of all of the conditions precedent described in Section 1 above, the Bank
hereby waives the Borrower’s non-compliance with said Section of the Loan Agreement as of March 31,
2007, and the Bank waives any Event of Default arising from such expressly-described failure to
comply. Except as expressly provided herein, all provisions of the Loan Agreement remain in full
force and effect, and this waiver shall not apply to any other or subsequent failure to comply with
the Section identified above or any other provision of the Loan Agreement.

          Section 3. Amendments.

     (a) The Loans. Section 1.1 of the Loan Agreement is hereby amended by
deleting the reference to “June 30, 2008” and replacing it with a reference to “September
30, 2008”.

     (b) Amendment of Financial Covenant. Section 4.16(e) of the Loan
Agreement is hereby amended and restated in its entirety to read as follows:

(e) Maintain a ratio of Allowance for loan and lease losses to Non-performing
Loans of not less than 85% at all times; and

          Section 4. Representations; No Default. The Borrower represents and warrants that:
(a) the Borrower has the power and legal right and authority to enter into this Amendment and has
duly authorized the execution and delivery of this Amendment and other agreements and documents
executed and delivered by the Borrower in connection herewith, (b) neither this Amendment nor the
agreements contained herein contravene or constitute an Event of Default, or an event which with
the giving of notice or passage of time or both would mature into an Event of Default (an
“Unmatured Event of Default”), under the Loan Agreement or a default under any other
agreement, instrument or indenture to which the Borrower is a party or a signatory, or any
provision of the Borrower’s Articles of Incorporation or Bylaws or, to the best of the Borrower’s
knowledge, any other agreement or requirement of law, or result in the imposition of any lien or
other encumbrance on any of its property under any agreement binding on or applicable to the
Borrower or any of its property except, if any, in favor of the Bank, (c) no consent, approval or
authorization of or registration or declaration with any party, including but not limited to any
governmental authority, is required in connection with the execution and delivery by the Borrower
of this Amendment or other agreements and documents executed and delivered by the Borrower in
connection herewith or the performance of obligations of the Borrower herein described, except for
those which the Borrower has obtained or provided and as to which the Borrower has delivered
certified copies of documents evidencing each such action to the Bank, (d) no events have taken
place and no circumstances exist at the date hereof which would give the Borrower grounds to assert
a defense, offset or counterclaim to the obligations of the Borrower under the Loan Agreement or
any of the other Loan Documents (defined below), and (e) there are no known claims, causes of
action, suits, debts, liens, obligations, liabilities, demands, losses, costs and expenses
(including attorneys’ fees) of any kind, character or nature whatsoever, fixed or contingent, which
the Borrower may have or claim to have against the Bank, which might arise out of or be connected
with any act of commission or omission of the Bank existing or occurring on or prior to the date of
this Amendment, including, without limitation, any claims, liabilities or obligations arising with
respect to the indebtedness evidenced by the Notes.

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          Section 5. Reaffirmation of Pledge Agreement. The Borrower hereby reaffirms that the
unpaid balance of the Notes and all of the other obligations of the Borrower under the Loan
Agreement are now and shall hereafter continue to be secured by, among other things, a first priority, perfected
security interest in the “Collateral” described in that certain Pledge Agreement dated May 5, 2003
executed by the Borrower in favor of the Bank. All of the terms, conditions, provisions,
agreements, requirements, promises, obligations, duties, covenants and representations of the
Borrower under such Pledge Agreement and any and all other documents and agreements entered into
with respect to the obligations of the Borrower under the Loan Agreement (collectively, the
“Loan Documents”) are incorporated herein by reference and are hereby ratified and affirmed
in all respects by the Borrower.

          Section 6. Affirmation, Further References. The Bank and the Borrower each acknowledge
and affirm that the Loan Agreement, as hereby amended, is hereby ratified and confirmed in all
respects and all terms, conditions and provisions of the Loan Agreement, except as amended by this
Amendment, shall remain unmodified and in full force and effect. All references in any document or
instrument to the Loan Agreement and the Loan Documents are hereby amended and shall refer to the
Loan Agreement and the Loan Documents, as amended by this Amendment.

          Section 7. Merger and Integration, Superseding Effect. This Amendment, from and after
the date hereof, embodies the entire agreement and understanding between the parties hereto and
supersedes and has merged into it all prior oral and written agreements on the same subjects by and
between the parties hereto with the effect that this Amendment, shall control with respect to the
specific subjects hereof and thereof.

          Section 8. Severability. Whenever possible, each provision of this Amendment and any
other statement, instrument or transaction contemplated hereby or thereby or relating hereto or
thereto shall be interpreted in such manner as to be effective, valid and enforceable under the
applicable law of any jurisdiction, but, if any provision of this Amendment or any other statement,
instrument or transaction contemplated hereby or thereby or relating hereto or thereto shall be
held to be prohibited, invalid or unenforceable under the applicable law, such provision shall be
ineffective in such jurisdiction only to the extent of such prohibition, invalidity or
unenforceability, without invalidating or rendering unenforceable the remainder of such provision
or the remaining provisions of this Amendment or any other statement, instrument or transaction
contemplated hereby or thereby or relating hereto or thereto in such jurisdiction, or affecting the
effectiveness, validity or enforceability of such provision in any other jurisdiction.

          Section 9. Successors. This Amendment shall be binding upon the Borrower, the Bank
and their respective successors and assigns, and shall inure to the benefit of the Borrower, the
Bank and to the respective successors and assigns of the Bank.

          Section 10. Costs and Expenses. The Borrower agrees to reimburse the Bank, upon
execution of this Amendment, for all reasonable out-of-pocket expenses (including attorneys’ fees
and legal expenses of counsel for the Bank) incurred in connection with the Loan Agreement,
including in connection with the negotiation, preparation and execution of this Amendment and all
other documents negotiated, prepared and executed in connection with this Amendment, and in
enforcing the obligations of the Borrower under this Amendment, and to pay and save the Bank
harmless from all liability for, any stamp or other taxes which may be payable with respect to the
execution or delivery of this Amendment.

          Section 11. Headings. The headings of various sections of this Amendment have been
inserted for reference only and shall not be deemed to be a part of this Amendment.

          Section 12. Counterparts. This Amendment may be executed in several counterparts as
deemed necessary or convenient, each of which, when so executed, shall be deemed an original,

3

 

provided that all such counterparts shall be regarded as one and the same document, and any party to this
Amendment may execute any such agreement by executing a counterpart of such agreement.

          Section 13. Governing Law. This Amendment shall be governed by the internal laws of
the State of Minnesota, without giving effect to conflict of law principles thereof.

          Section 14. No Waiver. Except as expressly provided herein, nothing contained in this
Amendment (or in any other agreement or understanding between the parties) shall constitute a
waiver of, or shall otherwise diminish or impair, the Bank’s rights or remedies under the Loan
Agreement or any of the other Loan Documents, or under applicable law.

[Remainder of page intentionally left blank;

signature page follows]

4

 

          IN WITNESS WHEREOF, the parties hereto have caused this Fifth Amendment to Loan Agreement and
Waiver to be executed as of the day and year first above written.

	 	 	 	 	 
	BORROWER:  	WESTERN RESERVE BANCORP, INC.,

an Ohio corporation

 	 
	 	By:  	/s/  Edward J. McKeon
 	 
	 	 	Printed Name:  	Edward J. McKeon 	 
	 	 	Its:     President & CEO 	 
	 	 	 
	 	By:  	                           /s/ Cynthia A. Mahl
 	 
	 	 	Printed Name:  	Cynthia A. Mahl  	 
	 	 	Its:     Senior Vice President & CFO 	 
	 
	BANK: 	TCF NATIONAL BANK,

a national banking association

 	 
	 	By:  	/s/   Adam Southard
 	 
	 	 	Printed Name:  	Adam Southard 	 
	 	 	Its:    Relationship Manager 	 
	 	 	 
	 	By:  	                           /s/  Guy J. Rau
 	 
	 	 	Printed Name:  	Guy J. Rau 	 
	 	 	Its:      Senior Vice President

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