|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Delaware
|
|
62-1559667
|
(State or other jurisdiction of
incorporation or organization)
|
|
(IRS Employer
Identification No.)
|
Title of each Class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, $0.01 par value per share
|
DVCR
|
OTCQX
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
|
(Unaudited)
|
|
|
||||
CURRENT ASSETS:
|
|
|
|
||||
Cash
|
$
|
4,163
|
|
|
$
|
2,710
|
|
Receivables
|
59,455
|
|
|
60,521
|
|
||
Self-insurance receivables, current portion
|
1,831
|
|
|
1,011
|
|
||
Other receivables
|
2,409
|
|
|
2,534
|
|
||
Prepaid expenses and other current assets
|
3,894
|
|
|
5,056
|
|
||
Income tax refundable
|
664
|
|
|
484
|
|
||
Total current assets
|
72,416
|
|
|
72,316
|
|
||
PROPERTY AND EQUIPMENT, at cost
|
133,701
|
|
|
132,775
|
|
||
Less accumulated depreciation and amortization
|
(87,174
|
)
|
|
(85,020
|
)
|
||
Property and equipment, net
|
46,527
|
|
|
47,755
|
|
||
OTHER ASSETS:
|
|
|
|
||||
Operating lease right-of-use assets
|
303,754
|
|
|
310,238
|
|
||
Acquired leasehold interest, net
|
5,603
|
|
|
5,736
|
|
||
Other noncurrent assets
|
2,896
|
|
|
4,323
|
|
||
Total other assets
|
312,253
|
|
|
320,297
|
|
||
|
$
|
431,196
|
|
|
$
|
440,368
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
PATIENT REVENUES, net
|
$
|
119,987
|
|
|
$
|
117,550
|
|
EXPENSES:
|
|
|
|
||||
Operating
|
94,859
|
|
|
94,422
|
|
||
Lease and rent expense
|
13,512
|
|
|
13,115
|
|
||
Professional liability
|
1,839
|
|
|
1,851
|
|
||
General and administrative
|
6,758
|
|
|
7,213
|
|
||
Depreciation and amortization
|
2,288
|
|
|
2,317
|
|
||
Total expenses
|
119,256
|
|
|
118,918
|
|
||
OPERATING INCOME (LOSS)
|
731
|
|
|
(1,368
|
)
|
||
OTHER INCOME (EXPENSE):
|
|
|
|
||||
Other income
|
115
|
|
|
160
|
|
||
Interest expense, net
|
(1,460
|
)
|
|
(1,394
|
)
|
||
Total other expense
|
(1,345
|
)
|
|
(1,234
|
)
|
||
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
(614
|
)
|
|
(2,602
|
)
|
||
BENEFIT FOR INCOME TAXES
|
104
|
|
|
1,028
|
|
||
LOSS FROM CONTINUING OPERATIONS
|
(510
|
)
|
|
(1,574
|
)
|
||
LOSS FROM DISCONTINUED OPERATIONS:
|
|
|
|
||||
Operating loss, net of tax benefit of $65 and $73, respectively
|
(243
|
)
|
|
(1,772
|
)
|
||
NET LOSS
|
$
|
(753
|
)
|
|
$
|
(3,346
|
)
|
NET LOSS PER COMMON SHARE:
|
|
|
|
||||
Per common share – basic
|
|
|
|
||||
Continuing operations
|
$
|
(0.08
|
)
|
|
$
|
(0.24
|
)
|
Discontinued operations
|
(0.04
|
)
|
|
(0.28
|
)
|
||
|
$
|
(0.12
|
)
|
|
$
|
(0.52
|
)
|
Per common share – diluted
|
|
|
|
||||
Continuing operations
|
$
|
(0.08
|
)
|
|
$
|
(0.24
|
)
|
Discontinued operations
|
(0.04
|
)
|
|
(0.28
|
)
|
||
|
$
|
(0.12
|
)
|
|
$
|
(0.52
|
)
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
|
|
|
|
||||
Basic
|
6,506
|
|
|
6,424
|
|
||
Diluted
|
6,506
|
|
|
6,424
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
NET LOSS
|
$
|
(753
|
)
|
|
$
|
(3,346
|
)
|
OTHER COMPREHENSIVE LOSS:
|
|
|
|
||||
Change in fair value of cash flow hedge, net of tax
|
(279
|
)
|
|
(63
|
)
|
||
Total other comprehensive loss
|
(279
|
)
|
|
(63
|
)
|
||
COMPREHENSIVE LOSS
|
$
|
(1,032
|
)
|
|
$
|
(3,409
|
)
|
|
Common Stock
|
|
Treasury Stock
|
|
Paid-in Capital
|
|
Accumulated Deficit
|
|
Accumulated
Other
Comprehensive Income (Loss)
|
|
Total
Shareholders' Deficit
|
||||||||||||||||||
|
Shares Issued
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
BALANCE, DECEMBER 31, 2018
|
6,751
|
|
|
$
|
68
|
|
|
232
|
|
|
$
|
(2,500
|
)
|
|
$
|
23,413
|
|
|
$
|
(23,016
|
)
|
|
$
|
837
|
|
|
$
|
(1,198
|
)
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,346
|
)
|
|
—
|
|
|
(3,346
|
)
|
||||||
Issuance/redemption of equity grants, net
|
163
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
41
|
|
|
—
|
|
|
—
|
|
|
42
|
|
||||||
Interest rate cash flow hedge
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(63
|
)
|
|
(63
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
140
|
|
|
—
|
|
|
—
|
|
|
140
|
|
||||||
BALANCE, MARCH 31, 2019
|
6,914
|
|
|
$
|
69
|
|
|
232
|
|
|
$
|
(2,500
|
)
|
|
$
|
23,594
|
|
|
$
|
(26,362
|
)
|
|
$
|
774
|
|
|
$
|
(4,425
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
BALANCE, DECEMBER 31, 2019
|
6,908
|
|
|
$
|
69
|
|
|
232
|
|
|
$
|
(2,500
|
)
|
|
$
|
24,026
|
|
|
$
|
(59,079
|
)
|
|
$
|
568
|
|
|
$
|
(36,916
|
)
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(753
|
)
|
|
—
|
|
|
(753
|
)
|
||||||
Issuance/redemption of equity grants, net
|
190
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||||
Interest rate cash flow hedge
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(279
|
)
|
|
(279
|
)
|
||||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
338
|
|
|
—
|
|
|
—
|
|
|
338
|
|
||||||
BALANCE, MARCH 31, 2020
|
7,098
|
|
|
$
|
70
|
|
|
232
|
|
|
$
|
(2,500
|
)
|
|
$
|
24,367
|
|
|
$
|
(59,832
|
)
|
|
$
|
289
|
|
|
$
|
(37,606
|
)
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
||||
Net loss
|
$
|
(753
|
)
|
|
$
|
(3,346
|
)
|
Loss from discontinued operations
|
(243
|
)
|
|
(1,772
|
)
|
||
Loss from continuing operations
|
(510
|
)
|
|
(1,574
|
)
|
||
Adjustments to reconcile loss from continuing operations to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
2,288
|
|
|
2,317
|
|
||
Deferred income tax benefit
|
—
|
|
|
(1,090
|
)
|
||
Provision for self-insured professional liability, net of cash payments
|
173
|
|
|
1,444
|
|
||
Amortization of right-of-use assets
|
5,663
|
|
|
5,125
|
|
||
Stock-based and deferred compensation
|
338
|
|
|
156
|
|
||
Provision for leases in excess of cash payments
|
821
|
|
|
1,280
|
|
||
Other
|
517
|
|
|
335
|
|
||
Changes in assets and liabilities affecting operating activities:
|
|
|
|
||||
Receivables
|
246
|
|
|
5,315
|
|
||
Prepaid expenses and other assets
|
792
|
|
|
(2,966
|
)
|
||
Trade accounts payable and accrued expenses
|
(2,021
|
)
|
|
(3,293
|
)
|
||
Operating lease liabilities
|
(5,656
|
)
|
|
(5,101
|
)
|
||
Net cash provided by continuing operations
|
2,651
|
|
|
1,948
|
|
||
Discontinued operations
|
(243
|
)
|
|
(1,609
|
)
|
||
Net cash provided by operating activities
|
2,408
|
|
|
339
|
|
||
NET CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Purchases of property and equipment
|
(927
|
)
|
|
(1,186
|
)
|
||
Net cash used in continuing operations
|
(927
|
)
|
|
(1,186
|
)
|
||
Discontinued operations
|
—
|
|
|
(312
|
)
|
||
Net cash used in investing activities
|
(927
|
)
|
|
(1,498
|
)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Repayment of debt and finance lease obligations
|
(2,113
|
)
|
|
(1,112
|
)
|
||
Proceeds from issuance of debt
|
2,500
|
|
|
2,049
|
|
||
Financing costs
|
(419
|
)
|
|
(40
|
)
|
||
Issuance and redemption of employee equity awards, net
|
4
|
|
|
42
|
|
||
Net cash provided by (used in) continuing operations
|
(28
|
)
|
|
939
|
|
||
Discontinued operations
|
—
|
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
$
|
(28
|
)
|
|
$
|
939
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
NET INCREASE (DECREASE) IN CASH
|
$
|
1,453
|
|
|
$
|
(220
|
)
|
CASH, beginning of period
|
2,710
|
|
|
2,685
|
|
||
CASH, end of period
|
$
|
4,163
|
|
|
$
|
2,465
|
|
SUPPLEMENTAL INFORMATION:
|
|
|
|
||||
Cash payments of interest
|
$
|
1,599
|
|
|
$
|
1,829
|
|
Cash payments of income taxes
|
$
|
10
|
|
|
$
|
426
|
|
SUPPLEMENTAL INFORMATION ON NON-CASH INVESTING AND FINANCING TRANSACTIONS:
|
|
|
|
||||
Acquisition of equipment through finance leases
|
$
|
—
|
|
|
$
|
49
|
|
Acquisition of operating leases though adoption of ASC 842
|
$
|
—
|
|
|
$
|
389,403
|
|
1.
|
BUSINESS
|
2.
|
CONSOLIDATION AND BASIS OF PRESENTATION OF FINANCIAL STATEMENTS
|
3.
|
RECENT ACCOUNTING GUIDANCE
|
|
Three Months Ended March 31,
|
||||||||||
|
2020
|
|
2019
|
||||||||
Medicaid
|
$
|
54,330
|
|
45.3
|
%
|
|
$
|
53,811
|
|
45.8
|
%
|
Medicare
|
20,672
|
|
17.2
|
%
|
|
20,391
|
|
17.3
|
%
|
||
Managed Care
|
12,596
|
|
10.5
|
%
|
|
12,998
|
|
11.1
|
%
|
||
Private Pay and other
|
32,389
|
|
27.0
|
%
|
|
30,350
|
|
25.8
|
%
|
||
Total
|
$
|
119,987
|
|
100.0
|
%
|
|
$
|
117,550
|
|
100.0
|
%
|
|
March 31,
|
|
December 31,
|
||||
|
2020
|
|
2019
|
||||
Medicaid
|
$
|
23,321
|
|
|
$
|
21,998
|
|
Medicare
|
9,621
|
|
|
11,811
|
|
||
Managed Care
|
8,052
|
|
|
9,103
|
|
||
Private Pay and other
|
18,461
|
|
|
17,609
|
|
||
Total accounts receivable
|
$
|
59,455
|
|
|
$
|
60,521
|
|
5.
|
LONG-TERM DEBT AND INTEREST RATE SWAP
|
|
|
Classification
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Assets
|
|
|
|
|
|
|
||||
Operating lease assets
|
|
Operating lease right-of-use assets
|
|
$
|
303,754
|
|
|
$
|
310,238
|
|
Finance lease assets
|
|
Property and equipment, net (a)
|
|
856
|
|
|
906
|
|
||
Total leased assets
|
|
|
|
$
|
304,610
|
|
|
$
|
311,144
|
|
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
|
|
||||
Current
|
|
|
|
|
|
|
||||
Operating
|
|
Current portion of operating lease liabilities
|
|
$
|
24,529
|
|
|
$
|
23,736
|
|
Finance
|
|
Current portion of long-term debt and finance lease obligations, net
|
|
234
|
|
|
231
|
|
||
Noncurrent
|
|
|
|
|
|
|
||||
Operating
|
|
Operating lease liabilities, less current portion
|
|
289,187
|
|
|
295,636
|
|
||
Finance
|
|
Long-term debt and finance lease obligations, less current portion and deferred financing costs, net
|
|
390
|
|
|
445
|
|
||
Total lease liabilities
|
|
|
|
$
|
314,340
|
|
|
$
|
320,048
|
|
|
|
|
|
|
|
|
||||
(a) Finance lease assets are recorded net of accumulated amortization of $1,583 and $1,522 as of March 31, 2020 and December 31, 2019, respectively.
|
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
Classification
|
|
2020
|
|
2019
|
||||
Operating lease cost (a)
|
|
Lease and rent expense
|
|
$
|
13,512
|
|
|
$
|
13,115
|
|
Finance lease cost:
|
|
|
|
|
|
|
||||
Amortization of finance lease assets
|
|
Depreciation and amortization
|
|
61
|
|
|
67
|
|
||
Interest on finance lease liabilities
|
|
Interest expense, net
|
|
9
|
|
|
11
|
|
||
Short term lease cost
|
|
Operating expense
|
|
179
|
|
|
141
|
|
||
Net lease cost
|
|
|
|
$
|
13,761
|
|
|
$
|
13,334
|
|
|
|
|
|
|
|
|
||||
(a) Includes variable lease costs, which are immaterial
|
|
|
As of March 31, 2020
|
||||||||||||
|
|
Operating Leases (a)
|
|
Finance Leases (a)
|
|
Total
|
||||||
|
|
|
|
|
|
|
||||||
2020
|
|
$
|
51,073
|
|
|
$
|
269
|
|
|
$
|
51,342
|
|
2021
|
|
52,063
|
|
|
233
|
|
|
52,296
|
|
|||
2022
|
|
53,072
|
|
|
136
|
|
|
53,208
|
|
|||
2023
|
|
54,015
|
|
|
35
|
|
|
54,050
|
|
|||
2024
|
|
53,898
|
|
|
7
|
|
|
53,905
|
|
|||
After 2024
|
|
186,982
|
|
|
—
|
|
|
186,982
|
|
|||
Total lease payments
|
|
$
|
451,103
|
|
|
$
|
680
|
|
|
$
|
451,783
|
|
Less: Interest
|
|
(137,387
|
)
|
|
(56
|
)
|
|
(137,443
|
)
|
|||
Present value of lease liabilities
|
|
$
|
313,716
|
|
|
$
|
624
|
|
|
$
|
314,340
|
|
|
|
|
|
|
|
|
||||||
(a) Operating and Finance lease payments exclude option to extend lease terms that are not reasonably certain of being exercised.
|
|
|
March 31, 2020
|
|
December 31, 2019
|
|
|
|
|
|
Weighted-average remaining lease term (years)
|
|
|
|
|
Operating leases
|
|
8.57
|
|
8.81
|
Finance leases
|
|
3.00
|
|
3.00
|
Weighted-average discount rate
|
|
|
|
|
Operating leases
|
|
8.9%
|
|
8.9%
|
Finance leases
|
|
6.1%
|
|
6.1%
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Cash paid for amounts included in the measurement of lease liabilities
|
|
|
|
|
||||
Operating cash flows for operating leases
|
|
$
|
12,673
|
|
|
$
|
12,132
|
|
Operating cash flows for finance leases
|
|
$
|
9
|
|
|
$
|
11
|
|
Financing cash flows for finance leases
|
|
$
|
52
|
|
|
$
|
132
|
|
Acquisition of operating leases through adoption of ASC 842
|
|
$
|
—
|
|
|
$
|
389,403
|
|
8.
|
STOCK-BASED COMPENSATION
|
|
|
|
Weighted
|
|||
|
Options/
|
|
Average
|
|||
|
SOSARs
|
|
Exercise Price
|
|||
Outstanding, December 31, 2019
|
76
|
|
|
$
|
7.55
|
|
Granted
|
—
|
|
|
—
|
|
|
Exercised
|
—
|
|
|
—
|
|
|
Expired or cancelled
|
(1
|
)
|
|
5.45
|
|
|
Outstanding, March 31, 2020
|
75
|
|
|
$
|
7.58
|
|
|
|
|
|
|||
Exercisable, March 31, 2020
|
75
|
|
|
$
|
7.58
|
|
|
|
|
Weighted
|
|||
|
|
|
Average
|
|||
|
Restricted
|
|
Grant Date
|
|||
|
Shares
|
|
Fair Value
|
|||
Outstanding, December 31, 2019
|
207
|
|
|
$
|
5.28
|
|
Granted
|
198
|
|
|
2.00
|
|
|
Vested
|
(188
|
)
|
|
3.93
|
|
|
Cancelled
|
(19
|
)
|
|
4.93
|
|
|
Outstanding, March 31, 2020
|
198
|
|
|
$
|
3.32
|
|
|
|
|
Weighted
|
|||
|
|
|
Average
|
|||
|
Restricted
|
|
Grant Date
|
|||
|
Share Units
|
|
Fair Value
|
|||
Outstanding, December 31, 2019
|
48
|
|
|
$
|
5.08
|
|
Granted
|
29
|
|
|
2.00
|
|
|
Vested
|
(13
|
)
|
|
8.11
|
|
|
Outstanding, March 31, 2020
|
64
|
|
|
$
|
3.05
|
|
|
|
Weighted
|
|
|
|
|
|
|
|
|
||||||||
|
|
Average
|
|
|
|
Intrinsic
|
|
|
|
Intrinsic
|
||||||||
Range of
|
|
Exercise
|
|
Grants
|
|
Value-Grants
|
|
Grants
|
|
Value-Grants
|
||||||||
Exercise Prices
|
|
Prices
|
|
Outstanding
|
|
Outstanding
|
|
Exercisable
|
|
Exercisable
|
||||||||
$8.14 to $10.21
|
|
$
|
8.83
|
|
|
45
|
|
|
$
|
—
|
|
|
45
|
|
|
$
|
—
|
|
$5.45 to $5.86
|
|
$
|
5.72
|
|
|
30
|
|
|
$
|
—
|
|
|
30
|
|
|
$
|
—
|
|
|
|
|
|
75
|
|
|
|
|
75
|
|
|
|
10.
|
EARNINGS PER COMMON SHARE
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Net loss
|
|
|
|
||||
Loss from continuing operations
|
$
|
(510
|
)
|
|
$
|
(1,574
|
)
|
Loss from discontinued operations, net of income taxes
|
(243
|
)
|
|
(1,772
|
)
|
||
Net loss
|
$
|
(753
|
)
|
|
$
|
(3,346
|
)
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Net loss per common share:
|
|
|
|
||||
Per common share – basic
|
|
|
|
||||
Loss from continuing operations
|
$
|
(0.08
|
)
|
|
$
|
(0.24
|
)
|
Loss from discontinued operations
|
(0.04
|
)
|
|
(0.28
|
)
|
||
Net loss per common share – basic
|
$
|
(0.12
|
)
|
|
$
|
(0.52
|
)
|
Per common share – diluted
|
|
|
|
||||
Loss from continuing operations
|
$
|
(0.08
|
)
|
|
$
|
(0.24
|
)
|
Loss from discontinued operations
|
(0.04
|
)
|
|
(0.28
|
)
|
||
Net loss per common share – diluted
|
$
|
(0.12
|
)
|
|
$
|
(0.52
|
)
|
Weighted Average Common Shares Outstanding:
|
|
|
|
||||
Basic
|
6,506
|
|
|
6,424
|
|
||
Diluted
|
6,506
|
|
|
6,424
|
|
11.
|
BUSINESS DEVELOPMENTS AND OTHER SIGNIFICANT TRANSACTIONS
|
12.
|
DISCONTINUED OPERATIONS
|
|
Three Months Ended March 31,
|
||||||||||
|
2020
|
|
2019
|
||||||||
Medicaid
|
$
|
54,330
|
|
45.3
|
%
|
|
$
|
53,811
|
|
45.8
|
%
|
Medicare
|
20,672
|
|
17.2
|
%
|
|
20,391
|
|
17.3
|
%
|
||
Managed Care
|
12,596
|
|
10.5
|
%
|
|
12,998
|
|
11.1
|
%
|
||
Private Pay and other
|
32,389
|
|
27.0
|
%
|
|
30,350
|
|
25.8
|
%
|
||
Total
|
$
|
119,987
|
|
100.0
|
%
|
|
$
|
117,550
|
|
100.0
|
%
|
Contractual Obligations
|
Total
|
|
Less than
1 year
|
|
1 to 3
Years
|
|
3 to 5
Years
|
|
After
5 Years
|
||||||||||
Long-term debt obligations (1)
|
$
|
81,174
|
|
|
$
|
7,865
|
|
|
$
|
73,268
|
|
|
$
|
41
|
|
|
$
|
—
|
|
Settlement obligations (2)
|
3,226
|
|
|
2,903
|
|
|
323
|
|
|
—
|
|
|
—
|
|
|||||
Settlement of civil investigative demand (3)
|
9,732
|
|
|
1,203
|
|
|
2,838
|
|
|
5,691
|
|
|
—
|
|
|||||
Operating leases (4)
|
451,105
|
|
|
51,073
|
|
|
105,135
|
|
|
107,913
|
|
|
186,984
|
|
|||||
Required capital expenditures under operating leases (5)
|
17,744
|
|
|
2,042
|
|
|
4,082
|
|
|
4,082
|
|
|
7,538
|
|
|||||
Total
|
$
|
562,981
|
|
|
$
|
65,086
|
|
|
$
|
185,646
|
|
|
$
|
117,727
|
|
|
$
|
194,522
|
|
(1)
|
Long-term debt obligations include scheduled future payments of principal and interest of long-term debt and amounts outstanding on our finance lease obligations. Our long-term debt obligations decreased $0.1 million between December 31, 2019 and March 31, 2020. See Note 5, "Long-Term Debt and Interest Rate Swap," to the interim consolidated financial statements included in this report for additional information.
|
(2)
|
Settlement obligations relate to professional liability cases that are expected to be paid within the next twelve months. The professional liabilities are included in our current portion of self-insurance reserves.
|
(3)
|
Settlement of civil investigative demand relates to our settlement agreement, including interest, with the U.S. Department of Justice and the State of Tennessee. See additional description of our contingencies in Note 7 "Commitments and Contingencies" to the interim consolidated financial statements and "Item 1. Legal Proceedings."
|
(4)
|
Represents minimum annual undiscounted lease payments (exclusive of taxes, insurance, and maintenance costs) under our operating lease agreements, which does not include renewals. Our operating lease obligations decreased $12.6 million between December 31, 2019 and March 31, 2020. See Note 6, "Leases," to the interim consolidated financial statements included in this report for additional information.
|
(5)
|
Includes annual expenditure requirements under operating leases. Our required capital expenditures decreased $1.0 million between December 31, 2019 and March 31, 2020.
|
(in thousands)
|
Three Months Ended March 31,
|
|||||||||||||
|
2020
|
|
2019
|
|
Change
|
|
%
|
|||||||
PATIENT REVENUES, net
|
$
|
119,987
|
|
|
$
|
117,550
|
|
|
$
|
2,437
|
|
|
2.1
|
%
|
EXPENSES:
|
|
|
|
|
|
|
|
|||||||
Operating
|
94,859
|
|
|
94,422
|
|
|
437
|
|
|
0.5
|
%
|
|||
Lease and rent expense
|
13,512
|
|
|
13,115
|
|
|
397
|
|
|
3.0
|
%
|
|||
Professional liability
|
1,839
|
|
|
1,851
|
|
|
(12
|
)
|
|
(0.6
|
)%
|
|||
General and administrative
|
6,758
|
|
|
7,213
|
|
|
(455
|
)
|
|
(6.3
|
)%
|
|||
Depreciation and amortization
|
2,288
|
|
|
2,317
|
|
|
(29
|
)
|
|
(1.3
|
)%
|
|||
Total expenses
|
119,256
|
|
|
118,918
|
|
|
338
|
|
|
0.3
|
%
|
|||
OPERATING INCOME (LOSS)
|
731
|
|
|
(1,368
|
)
|
|
2,099
|
|
|
N/M
|
||||
OTHER INCOME (EXPENSE):
|
|
|
|
|
|
|
|
|||||||
Other income
|
115
|
|
|
160
|
|
|
(45
|
)
|
|
(28.1
|
)%
|
|||
Interest expense, net
|
(1,460
|
)
|
|
(1,394
|
)
|
|
(66
|
)
|
|
(4.7
|
)%
|
|||
Total other expenses
|
(1,345
|
)
|
|
(1,234
|
)
|
|
(111
|
)
|
|
(9.0
|
)%
|
|||
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
(614
|
)
|
|
(2,602
|
)
|
|
1,988
|
|
|
76.4
|
%
|
|||
BENEFIT FOR INCOME TAXES
|
104
|
|
|
1,028
|
|
|
(924
|
)
|
|
(89.9
|
)%
|
|||
LOSS FROM CONTINUING OPERATIONS
|
$
|
(510
|
)
|
|
$
|
(1,574
|
)
|
|
$
|
1,064
|
|
|
67.6
|
%
|
Percentage of Net Revenues
|
Three Months Ended March 31,
|
||||
|
2020
|
|
2019
|
||
PATIENT REVENUES, net
|
100.0
|
%
|
|
100.0
|
%
|
EXPENSES:
|
|
|
|
||
Operating
|
79.1
|
|
|
80.3
|
|
Lease and rent expense
|
11.3
|
|
|
11.2
|
|
Professional liability
|
1.5
|
|
|
1.6
|
|
General and administrative
|
5.6
|
|
|
6.1
|
|
Depreciation and amortization
|
1.9
|
|
|
2.0
|
|
Total expenses
|
99.4
|
|
|
101.2
|
|
OPERATING LOSS
|
0.6
|
|
|
(1.2
|
)
|
OTHER INCOME (EXPENSE):
|
|
|
|
||
Other income
|
0.1
|
|
|
0.1
|
|
Interest expense, net
|
(1.1
|
)
|
|
(1.1
|
)
|
Total other expenses
|
(1.0
|
)
|
|
(1.0
|
)
|
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
(0.4
|
)
|
|
(2.2
|
)
|
BENEFIT FOR INCOME TAXES
|
0.1
|
|
|
0.9
|
|
LOSS FROM CONTINUING OPERATIONS
|
(0.3
|
)%
|
|
(1.3
|
)%
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Skilled nursing occupancy
|
76.4
|
%
|
|
77.6
|
%
|
||
As a percent of total census:
|
|
|
|
||||
Medicare census
|
9.0
|
%
|
|
10.0
|
%
|
||
Medicaid census
|
68.2
|
%
|
|
68.2
|
%
|
||
Managed Care census
|
4.7
|
%
|
|
5.0
|
%
|
||
As a percent of total revenues:
|
|
|
|
||||
Medicare revenues
|
17.2
|
%
|
|
17.3
|
%
|
||
Medicaid revenues
|
45.3
|
%
|
|
45.8
|
%
|
||
Managed Care revenues
|
10.5
|
%
|
|
11.1
|
%
|
||
Average rate per day:
|
|
|
|
||||
Medicare
|
$
|
487.01
|
|
|
$
|
453.63
|
|
Medicaid
|
$
|
181.31
|
|
|
$
|
179.37
|
|
Managed Care
|
$
|
391.34
|
|
|
$
|
393.09
|
|
|
Requirement
|
|
Level at
March 31, 2020
|
Credit Facility:
|
|
|
|
Minimum fixed charge coverage ratio
|
1.01:1.00
|
|
1.14:1.00
|
Minimum adjusted EBITDA
|
$3.3 million
|
|
$3.9 million
|
Current ratio (as defined in agreement)
|
1.00:1.00
|
|
1.21:1.00
|
Affiliated Revolver:
|
|
|
|
Minimum fixed charge coverage ratio
|
1.00:1.00
|
|
2.13:1.00
|
Minimum adjusted EBITDA
|
$0.8 million
|
|
$1.2 million
|
Mortgaged Centers:
|
|
|
|
EBITDAR
|
$10.0 million
|
|
$14.2 million
|
•
|
our ability to successfully integrate the operations of new nursing centers, as well as successfully operate all of our centers,
|
•
|
our ability to increase census at our centers and occupancy rates at our centers,
|
•
|
changes in governmental reimbursement, including the new Patient-Driven Payment Model that was in October of 2019,
|
•
|
government regulation,
|
•
|
the impact of the Affordable Care Act, efforts to repeal or further modify the Affordable Care Act, and other health care reform initiatives,
|
•
|
any increases in the cost of borrowing under our credit agreements,
|
•
|
our ability to comply with covenants contained in those credit agreements,
|
•
|
our ability to comply with the terms of our master lease agreements,
|
•
|
our ability to renew or extend our leases at or prior to the end of the existing lease terms,
|
•
|
the outcome of professional liability lawsuits and claims,
|
•
|
our ability to control ultimate professional liability costs,
|
•
|
the accuracy of our estimate of our anticipated professional liability expense,
|
•
|
the impact of future licensing surveys,
|
•
|
the outcome of proceedings alleging violations of state or Federal False Claims Acts,
|
•
|
laws and regulations governing quality of care or other laws and regulations applicable to our business including HIPAA and laws governing reimbursement from government payors,
|
•
|
the costs of investing in our business initiatives and development,
|
•
|
our ability to control costs,
|
•
|
our ability to attract and retain qualified healthcare professionals,
|
•
|
changes to our valuation of deferred tax assets,
|
•
|
changing economic and competitive conditions,
|
•
|
changes in anticipated revenue and cost growth,
|
•
|
changes in the anticipated results of operations,
|
•
|
the effect of changes in accounting policies as well as others.
|
|
|
|
|
Exhibit
Number
|
|
Description of Exhibits
|
|
3.1
|
|
|
Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement No. 33-76150 on Form S-1 filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T).
|
|
|
||
|
|
Certificate of Designation of Registrant (incorporated by reference to Exhibit 3.5 to the Company’s quarterly report on Form 10-Q for the quarter ended September 30, 2006).
|
|
|
|
||
3.3
|
|
|
Bylaws of the Company (incorporated by reference to Exhibit 3.2 to the Company’s Registration Statement No. 33-76150 on Form S-1 filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T).
|
|
|
||
|
|
Bylaw Amendment adopted November 5, 2007 (incorporated by reference to Exhibit 3.4 to the Company’s annual report on Form 10-K for the year ended December 31, 2007).
|
|
|
|
||
3.5
|
|
|
Amendment to Certificate of Incorporation dated March 23, 1995 (incorporated by reference to Exhibit A of Exhibit 1 to the Company’s Form 8-A filed March 30, 1995 filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T).
|
|
|
||
|
|
Certificate of Designation of Registrant (incorporated by reference to Exhibit 3.4 to the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2001).
|
|
|
|
||
|
|
Certificate of Ownership and Merger of Diversicare Healthcare Services, Inc. with and into Advocat Inc. (incorporated by reference to Exhibit 3.1 to the Company's current report on Form 8-K filed March 14, 2013).
|
|
|
|
|
|
|
|
Amendment to Certificate of Incorporation dated June 9, 2016 (incorporated by reference to Exhibit 3.8 to the Company's quarterly report on Form 10-Q for the quarter ended June 30, 2016).
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Bylaw Second Amendment adopted April 14, 2016.
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4.1
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Form of Common Stock Certificate (incorporated by reference to Exhibit 4 to the Company's Registration Statement No. 33-76150 on Form S-1 filed in paper - hyperlink is not required pursuant to Rule 105 of Regulation S-T).
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Eighth Amendment to Third Amended and Restated Revolving Loan and Security Agreement
dated February 25, 2020 (incorporated by reference to Exhibit 10.36 to the Company’s annual
report on Form 10-K for the year ended December 31, 2019).
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Sixth Amendment to Second Amended and Restated Term Loan and Security Agreement dated
February 25, 2020 (incorporated by reference to Exhibit 10.37 to the Company’s annual report Form 10-K for the year ended December 31, 2019).
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First Amendment to Revolving Loan and Security Agreement dated February 25, 2020 (incorporated by reference to Exhibit 10.38 to the Company's annual report on Form 10-K for the year ended December 31, 2019).
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Settlement Agreement with the U.S. Department of Justice and the State of Tennessee dated
February 14, 2020 (incorporated by reference to Exhibit 10.39 to the Company’s annual report on Form 10-K for the year ended December 31, 2019).
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Corporate Integrity Agreement with the Office of the Inspector General of CMS dated February
14, 2020 (incorporated by reference to Exhibit 10.40 to the Company’s annual report on Form 10-K for the year ended December 31, 2019).
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Leslie Campbell Separation Agreement
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Employment Agreement effective March 2, 2020, between Rebecca Bodie and Diversicare Healthcare Services, Inc.
|
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|
|
Ninth Amendment to Third Amended and Restated Revolving Loan and Security Agreement
dated April 3, 2020.
|
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|
Seventh Amendment to Second Amended and Restated Term Loan and Security Agreement dated
April 3, 2020.
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Second Amendment to Revolving Loan and Security Agreement dated April 3, 2020.
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Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a).
|
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Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a).
|
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||
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) or Rule 15d-14(b).
|
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|
||
101.INS
|
|
|
XBRL Instance Document
|
|
|
||
101.SCH
|
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
||
101.CAL
|
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
||
101.LAB
|
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
||
101.PRE
|
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
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|
Diversicare Healthcare Services, Inc.
|
||
|
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|
May 7, 2020
|
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|
By:
|
|
/s/ James R. McKnight, Jr.
|
|
|
|
James R. McKnight, Jr.
|
|
|
|
President and Chief Executive Officer, Principal Executive Officer and
|
|
|
|
An Officer Duly Authorized to Sign on Behalf of the Registrant
|
|
|
|
|
|
By:
|
|
/s/ Kerry D. Massey
|
|
|
|
Kerry D. Massey
|
|
|
|
Executive Vice President and Chief Financial Officer and
|
|
|
|
An Officer Duly Authorized to Sign on Behalf of the Registrant
|
A.
|
She has carefully read and fully understands the comprehensive terms and conditions of this Agreement and the releases set forth herein;
|
B.
|
She is executing this Agreement knowingly and voluntarily, without any duress, coercion or undue influence by the Company, its representatives, or any other person;
|
C.
|
She has been informed of her right to consult with legal counsel of her own choice before executing this Agreement;
|
D.
|
She has pending no claim, complaint, grievance or any document with any federal or state agency or any court seeking money damages or relief against the Company;
|
E.
|
The Benefits recited above constitute good and valuable consideration;
|
F.
|
She is fully satisfied with the terms and conditions of this Agreement including, without limitation, the consideration paid to her by the Company;
|
G.
|
She is not waiving rights or claims that may arise after the date this Agreement is executed; and
|
H.
|
Except as specifically provided herein, she has been paid all compensation owed to her by the Company.
|
Dated: February 14, 2020
|
DIVERSICARE HEALTHCARE SERVICES, INC.
|
A.
|
Period of Employment
|
B.
|
Duties
|
A.
|
Compensation
|
1.
|
Base Salary
|
B.
|
Annual Incentive Awards
|
C.
|
Additional Benefits
|
D.
|
For this Agreement, the following terms have the following meanings:
|
1.
|
“Termination for Cause” is limited to the following:
|
(iii)
|
The Executive shall breach her fiduciary duty to the Company;
|
B.
|
Section 409A Compliance.
|
2.
|
Delayed Payments.
|
C.
|
Section 409A Definitions.
|
3.
|
A “Change in Control” shall mean any of the following:
|
(ii)
|
Change in the Effective Control of the Company.
|
By:
|
James R. McKnight, Jr.
|
BORROWER:
ADVOCAT FINANCE, INC. DIVERSICARE MANAGEMENT SERVICES CO. DIVERSICARE LEASING CORP. STERLING HEALTH CARE MANAGEMENT, INC. DIVERSICARE TEXAS I, LLC DIVERSICARE HOLDING COMPANY, LLC DIVERSICARE KANSAS, LLC DIVERSICARE LEASING COMPANY II, LLC DIVERSICARE PROPERTY CO., LLC |
||
By:
|
/s/Kerry D. Massey
|
|
Name:
|
Kerry D. Massey
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
SENIOR CARE CEDAR HILLS, LLC
SENIOR CARE GOLFCREST, LLC
SENIOR CARE GOLFVIEW, LLC
SENIOR CARE SOUTHERN PINES, LLC
|
|||
BY:
|
SENIOR CARE FLORIDA LEASING, LLC, its sole member
|
||
|
BY:
|
DIVERSICARE LEASING CORP., its sole member
|
|
|
By:
|
/s/Kerry D. Massey
|
|
|
Name:
|
Kerry D. Massey
|
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
SENIOR CARE FLORIDA LEASING, LLC
DIVERSICARE AFTON OAKS, LLC
DIVERSICARE BRIARCLIFF, LLC
DIVERSICARE CHISOLM, LLC
DIVERSICARE HARTFORD, LLC
DIVERSICARE PINEDALE, LLC
DIVERSICARE WINDSOR HOUSE, LLC
DIVERSICARE ROSE TERRACE, LLC
DIVERSICARE THERAPY SERVICES, LLC
DIVERSICARE CLINTON, LLC
DIVERSICARE HIGHLANDS, LLC |
|||
BY:
|
DIVERSICARE LEASING CORP., its sole member
|
||
|
By:
|
/s/Kerry D. Massey
|
|
|
Name:
|
Kerry D. Massey
|
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
|
|
DIVERSICARE BALLINGER, LLC
DIVERSICARE DOCTORS, LLC
DIVERSICARE ESTATES, LLC
DIVERSICARE KATY, LLC
DIVERSICARE NORMANDY TERRACE, LLC
DIVERSICARE TREEMONT, LLC
DIVERSICARE PARIS, LLC
|
|||
BY:
|
DIVERSICARE TEXAS I, LLC, its sole member
|
||
|
By:
|
/s/Kerry D. Massey
|
|
|
Name:
|
Kerry D. Massey
|
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
DIVERSICARE OF CHANUTE, LLC
DIVERSICARE OF COUNCIL GROVE, LLC
DIVERSICARE OF HAYSVILLE, LLC
DIVERSICARE OF SEDGWICK, LLC
DIVERSICARE OF HUTCHINSON, LLC
DIVERSICARE OF LARNED, LLC
|
|||
BY:
|
DIVERSICARE KANSAS, LLC
its sole member
|
||
|
|
||
|
By:
|
/s/Kerry D. Massey
|
|
|
Name:
|
Kerry D. Massey
|
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
By:
|
DIVERSICARE LEASING COMPANY II, LLC, its sole member
|
Name:
|
Kerry D. Massey
|
Its:
|
Executive Vice President and Chief Financial Officer
|
By:
|
DIVERSICARE PROPERTY CO., LLC, its sole member
|
Its:
|
Executive Vice President and Chief Financial Officer
|
By:
|
DIVERSICARE HOLDING COMPANY, LLC, its sole member
|
Its:
|
Executive Vice President and Chief Financial Officer
|
Name:
|
Kerry D. Massey
|
Its:
|
Executive Vice President and Chief Financial Officer
|
By:
|
DIVERSICARE LEASING COMPANY III, LLC, its sole member
|
Its:
|
Executive Vice President and Chief Financial Officer
|
Acknowledged and Agreed:
DIVERSICARE HEALTHCARE SERVICES, INC.
By: /s/James R. McKnight, Jr. Name: James R. McKnight, Jr. Its: President and Chief Executive Officer |
||
|
|
|
LENDER:
BANKERS TRUST COMPANY
|
||
By: /s/Mike Wilson
|
|
|
Name:
|
Mike Wilson
|
|
Its:
|
EVP & Chief Lending Officer
|
|
LENDER:
BOKF, NA D/B/A BANK OF OKLAHOMA
|
||
By: /s/Bria Colgan
|
|
|
Name:
|
Bria Colgan
|
|
Its:
|
Senior Vice President
|
|
LENDER:
CIT BANK, N.A.
|
||
By: /s/Edward Shuster
|
|
|
Name:
|
Edward Shuster
|
|
Its:
|
Director
|
|
LENDER:
OPUS BANK,
a California commercial bank |
||
By: /s/Sangjin Na
|
|
|
Name:
|
Sangjin Na
|
|
Its:
|
Vice President
|
|
LENDER:
FRANKLIN SYNERGY BANK
|
||
By: _/s/ Lisa Fletcher______________
|
|
|
Name:
|
Lisa Fletcher
|
|
Its:
|
Senior Vice President
|
|
BORROWER:
|
||
DIVERSICARE AFTON OAKS, LLC
|
||
DIVERSICARE BRIARCLIFF, LLC
|
||
DIVERSICARE CHISOLM, LLC
|
||
DIVERSICARE HARTFORD, LLC
|
||
DIVERSICARE WINDSOR HOUSE, LLC
|
||
|
||
By:
|
Diversicare Leasing Corp., its sole member
|
|
|
By:
|
/s/Kerry D. Massey
|
|
Name: Kerry D. Massey
|
|
|
Its: Executive Vice President and Chief Financial Officer
|
|
DIVERSICARE OF CHANUTE, LLC
|
||
DIVERSICARE OF COUNCIL GROVE, LLC
|
||
DIVERSICARE OF HAYSVILLE, LLC
|
||
DIVERSICARE OF SEDGWICK, LLC
|
||
DIVERSICARE OF HUTCHINSON, LLC
|
||
DIVERSICARE OF LARNED, LLC
|
||
By:
|
Diversicare Kansas, LLC, its sole member
|
|
|
By:
|
/s/Kerry D. Massey
|
|
Name: Kerry D. Massey
|
|
|
Its: Executive Vice President and Chief Financial Officer
|
DIVERSICARE PROPERTY CO., LLC
|
||
|
|
|
|
By:
|
/s/Kerry D. Massey
|
|
Name: Kerry D. Massey
|
|
|
Its: Executive Vice President and Chief Financial Officer
|
DIVERSICARE AFTON OAKS PROPERTY, LLC
|
||
DIVERSICARE BRIARCLIFF PROPERTY, LLC
|
||
DIVERSICARE CHANUTE PROPERTY, LLC
|
||
DIVERSICARE CHISOLM PROPERTY, LLC
|
||
DIVERSICARE COUNCIL GROVE PROPERTY, LLC
|
||
DIVERSICARE HAYSVILLE PROPERTY, LLC
|
||
DIVERSICARE HARTFORD PROPERTY, LLC
|
||
DIVERSICARE HILLCREST PROPERTY, LLC
|
||
DIVERSICARE LAMPASAS PROPERTY, LLC
|
||
DIVERSICARE LARNED PROPERTY, LLC
|
||
DIVERSICARE SEDGWICK PROPERTY, LLC
|
||
DIVERSICARE WINDSOR HOUSE PROPERTY, LLC
|
||
DIVERSICARE YORKTOWN PROPERTY, LLC
|
||
DIVERSICARE HUTCHINSON PROPERTY, LLC
|
||
DIVERSICARE SELMA PROPERTY, LLC
|
||
By:
|
Diversicare Property Co., LLC, its sole member
|
|
|
By:
|
/s/Kerry D. Massey
|
|
Name: Kerry D. Massey
|
|
|
Its: Executive Vice President and Chief Financial Officer
|
DIVERSICARE OF SELMA, LLC
|
||
By:
|
Diversicare Holding Company, LLC, its sole member
|
|
|
By:
|
/s/Kerry D. Massey
|
|
Name: Kerry D. Massey
|
|
|
Its: Executive Vice President and Chief Financial Officer
|
Acknowledged and Agreed:
DIVERSICARE HEALTHCARE SERVICES, INC.
By: /s/James R. McKnight, Jr. Name: James R. McKnight, Jr. Its: President and Chief Executive Officer |
Its:
|
Director
|
LENDER:
|
OPUS BANK,
a California commercial bank |
By: /s/Sangjin Na
Name: Sangjin Na
Its: Vice President
|
|
|
LENDER:
|
|
FRANKLIN SYNERGY BANK
|
|
By:
|
/s/ Lisa Fletcher
|
|
Name: Lisa Fletcher
|
|
Its: Senior Vice President
|
|
|
BORROWER AGENT:
DIVERSICARE MANAGEMENT SERVICES CO. |
||
By:
|
/s/Kerry D. Massey
|
|
Name:
|
Kerry D. Massey
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
BORROWER:
DIVERSICARE HILLCREST, LLC
DIVERSICARE LAMPASAS, LLC
DIVERSICARE YORKTOWN, LLC
|
|||
BY:
|
DIVERSICARE LEASING CORP., its sole member
|
||
|
By:
|
/s/Kerry D. Massey
|
|
|
Name:
|
Kerry D. Massey
|
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
|
|
DIVERSICARE HUMBLE, LLC
|
|||
BY:
|
DIVERSICARE TEXAS I, LLC, its sole member
|
||
|
By:
|
/s/Kerry D. Massey
|
|
|
Name:
|
Kerry D. Massey
|
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
Acknowledged and Agreed:
DIVERSICARE HEALTHCARE SERVICES, INC.
By: /s/James R. McKnight, Jr.________________ Name: James R. McKnight, Jr. Its: President and Chief Executive Officer |
||
|
|
|
LENDER:
BANKERS TRUST COMPANY
|
||
By: /s/Mike Wilson
Name: Mike Wilson
Its: EVP & Chief Lending Officer
|
|
|
|
|
|
LENDER:
BOKF, NA D/B/A BANK OF OKLAHOMA
|
||
By: /s/Bria Colgan
|
|
|
Name:
|
Bria Colgan
|
|
Its:
|
Senior Vice President
|
|
LENDER:
CIT BANK, N.A.
|
||
By: /s/Edward Shuster___________________
|
|
|
Name:
|
Edward Shuster
|
|
Its:
|
Director
|
|
LENDER:
OPUS BANK,
a California commercial bank |
||
By: /s/Sangjin Na
|
|
|
Name:
|
Sangjin Na
|
|
Its:
|
Vice President
|
|
LENDER:
FRANKLIN SYNERGY BANK
|
||
By: _/s/ Lisa Fletcher____________
|
|
|
Name:
|
Lisa Fletcher
|
|
Its:
|
Senior Vice President
|
|
Its:
|
Executive Vice President and Chief Financial Officer
|
|
/s/ James R. McKnight, Jr.
|
James R. McKnight, Jr.
|
President and Chief Executive Officer, Principal Executive Officer and
|
An Officer Duly Authorized to Sign on Behalf of the Registrant
|
|
/s/ Kerry D. Massey
|
Kerry D. Massey
|
Executive Vice President and Chief Financial Officer and
|
An Officer Duly Authorized to Sign on Behalf of the Registrant
|
(a)
|
fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(b)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
/s/ James R. McKnight, Jr.
|
James R. McKnight, Jr.
|
President and Chief Executive Officer, Principal Executive Officer and
|
An Officer Duly Authorized to SIgn on Behalf of the Registrant
|
|
/s/ Kerry D. Massey
|
Kerry D. Massey
|
Executive Vice President and Chief Financial Officer and
|
An Officer Duly Authorized to SIgn on Behalf of the Registrant
|