Exhibit 10.6
ADDENDUM TO CONTINUING GUARANTY
THIS ADDENDUM TO CONTINUING GUARANTY (the "Addendum") is made
and dated as of the 17th day of February, 1998, by and between MIRAVANT MEDICAL
TECHNOLOGIES ("Guarantor"), and SANWA BANK CALIFORNIA ("Bank").
RECITALS
A. Pursuant to that certain Term Loan Agreement dated
concurrently herewith, Bank agreed to extend credit to XXXXXXX X. XXXXXX, an
individual (the "Debtor") in the form of a $7,600,000.00 term loan (the "Term
Loan") on the terms and subject to the conditions set forth more particularly
therein (as amended, extended and replaced from time to time, the "Loan
Agreement," and with capitalized terms not otherwise defined herein used with
the meanings given such terms in the Loan Agreement). The obligations of the
Debtor with respect to the Term Loan, including, without limitation, to pay
principal and interest on amounts outstanding under the Loan Agreement, are
secured by certain collateral consisting generally of outstanding capital stock
of Guarantor owned by the Debtor (the "Pledged Stock") pursuant to the terms of
the Loan Agreement.
B. As a condition precedent to the agreement of Bank to fund
the Term Loan to the Debtor, Bank has required Guarantor to execute and deliver
a credit guaranty of the obligations of the Debtor with respect to the Term Loan
in the form of the Continuing Guaranty dated concurrently herewith to which this
Addendum is attached (as amended, extended and replaced from time to time, the
"Guaranty").
C. In addition to providing the Guaranty, Bank has required
that Guarantor agree under certain circumstances to purchase from Bank upon
demand the Term Loan and all right, title and interest of Bank therein,
including, without limitation, under the Loan Agreement, (the "Loan Package").
D. Guarantor and Bank desire to set forth in this Addendum,
which is attached to and hereby made a part of the Guaranty, the terms and
conditions under which Bank may require Guarantor to purchase the Loan Package.
NOW, THEREFORE, in consideration of the above Recitals and for
other good and valuable consideration the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1. Purchase Commitment. Guarantor hereby agrees that upon the
delivery to Guarantor of written notice from Bank that a Put Event (as defined
below) has occurred, Guarantor absolutely and unconditionally agrees that no
later than one (1) Business Day thereafter Guarantor will purchase and take from
Bank all of Bank's right, title and interest in the Loan Package. For purposes
of this Paragraph l, the term "Put Event" shall mean: (a) the occurrence of an
Event of Default under the Loan Agreement, or (b) receipt by Bank of any
instruction from, or request by or on behalf of, the Debtor which Bank, in its
reasonable business judgment, concludes constitutes a request or demand to sell
or otherwise dispose of the Pledged Stock due to a decline or anticipated
decline in the value thereof .
2. Purchase Price. The purchase price to be paid by the
Guarantor for Bank's right, title and interest in the Loan Package shall be an
amount equal to the sum of: (a) the outstanding principal balance under the Loan
Agreement, (b) interest accrued and unpaid thereon to and including the purchase
date, plus (c) all other Obligations outstanding. The purchase price shall be
paid to Bank in lawful money of the United States and in immediately available
funds on the purchase date.
3. Delivery of Loan Package; Transfer Expenses. Upon payment
in full by the Purchaser to Bank of the purchase price pursuant to Paragraph 2
above, Bank shall deliver to Guarantor an assignment of the right, title and
interest of Bank in the Loan Agreement and such other documents, instruments and
agreements relating to the Term Loan as Guarantor may reasonably request which
are in Guarantor's judgment necessary to transfer Bank's rights in the Loan
Package to it; provided, however, that Guarantor acknowledges that the Special
Power of Attorney granted by Borrower to Bank is personal to Bank and not
transferrable. Any and all endorsements, assignments and other documents,
instruments and agreements executed by Bank hereunder shall be without recourse
to and, except as expressly set forth in Paragraph 4 below, without
representation or warranty, express or implied, by Bank. Guarantor shall be
responsible for all costs and expenses incurred or assessed against Bank in
connection with such transfer all of which shall be payable by Guarantor to Bank
upon demand with interest thereon at the Reference Rate minus 1.000% per annum
(computed on the basis of a 360-day year) from the date demand is made by Bank
until paid in full.
4. Representation and Warranty. On and as of the purchase date
for the Loan Package sold and transferred as contemplated hereby, Bank hereby
represents and warrants that immediately prior to the consummation of the
purchase and sale transaction Bank had good title to and was the sole owner of
the Loan Package and upon payment by Guarantor of the purchase price therefor
Guarantor will have good title to the Loan Package free and clear of any lien,
claim or other interest of any person or entity claiming by or through Bank.
5. Extent of Obligations. Guarantors' obligation to purchase
the right, title and interest of Bank in the Loan Package as provided herein is
absolute and unconditional and subject to all waivers and other terms and
provisions set forth in the Guaranty, including, without limitation, Paragraph 4
thereof. Without limiting the generality of the foregoing, Guarantor hereby
independently and irrevocably waives: (a) any defense to such obligation that
may arise by reason of the disability or other defense or cessation of liability
of the Debtor for any reason other than full payment; (b) deferral of such
obligation arising by reason of the institution of bankruptcy, insolvency,
reorganization, moratorium or other similar proceedings by or against the Debtor
or any other person or entity; (c) any defense arising as a result of Bank's
failure to preserve or protect the Loan Package, including, without limitation,
the Pledged Stock or to perfect or maintain the perfection or priority of any
lien thereon or Bank's exercise or failure to exercise any right, power or
remedy, including, without limitation, the failure to proceed first against the
Debtor, any security it holds under the Loan Agreement, including, without
limitation, the Pledged Stock, even when such election or failure impairs alters
or negates the rights of Guarantor against the Debtor, whether arising by way of
subrogation or otherwise. Guarantor agree that Bank may, without notice and
without releasing the Guarantor from its obligations under the Guaranty or under
this Addendum, extend the time for making any payment or extend the performance
of any agreement and may proceed against Guarantor directly and independently of
the Debtor or any other person or entity.
6. No Reliance. Guarantor confirms that it has reviewed and
approved the Loan Agreement and each of the other documents, instruments and
agreements included in the Loan Package. Guarantor expressly acknowledges that
neither Bank nor any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates (the "Bank-Related Parties") has made any
representations or warranties to it with respect to the Debtor or the Loan
Package and that no act by Bank or any Bank-Related Party hereinafter taken,
including any review of the affairs of the Debtor shall be deemed to constitute
any representation or warranty by Bank or any Bank-Related Party with respect
thereto. Guarantor represents and warrants to Bank that in agreeing to enter
into the Guaranty and this Addendum, it has, independently and without reliance
upon Bank or any Bank-Related Party, and based on such documents and information
as it has deemed appropriate, made its own appraisal of and investigation into
the business, operations, property, financial and other condition and
creditworthiness of the Debtor and made its own decision to enter into the
Guaranty and this Addendum. Guarantor also represents that it will,
independently and without reliance upon Bank or any Bank-Related Party, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under the Guaranty and/or this Addendum and to make
such investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Debtor. Bank shall have no any duty or responsibility to provide Guarantor with
any credit or other information concerning the business, operations, property,
financial and other condition or creditworthiness of the Debtor which may come
into the possession of Bank or any Bank-Related Party.
7. Relationship to Guaranty. All obligations of Guarantor
under this Addendum are in addition to and not in substitution for all
obligations of Guarantor under the Guaranty. Subject to the foregoing, this
Addendum is hereby incorporated into and shall form a xxx of the Guaranty for
all purposes thereof.
IN WITNESS WHEREOF, the undersigned hereby execute and deliver this
Addendum on and as of the day first above written.
GUARANTOR: MIRAVANT MEDICAL TECHNOLOGIES
By: /s/ Xxxx X. Xxxxxxx
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Xxxx X. Xxxxxxx, Chairman and CEO
BANK: SANWA BANK CALIFORNIA
By: /s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx, Vice President
ACKNOWLEDGED AND AGREED TO: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx, an individual