FIRST AMENDMENT TO
CREDIT AGREEMENT
This First Amendment ("Amendment") amends that certain Credit Agreement executed
by and between Alliance Pharmaceutical Corp., a New York corporation
("Borrower") and Imperial Bank ("Bank") as of June 17, 1998 (the "Agreement"),
as modified by that certain Agreement to Waive Covenant Violation and Modify
Loan ("Waiver") dated May 18, 1999, as follows:
1. Upon the effective date of this Amendment, MDV TECHNOLOGIES, INC. is hereby
added as an additional Borrower to the Agreement and the following language is
hereby inserted in the Agreement as new Section 5.12:
SURETYSHIP WAIVERS AND CONSENTS. Each Borrower agrees that it is
jointly and severally, directly, and primarily liable to Bank for
payment in full of all obligations under the Loan Documents
("Obligations") and that such liability is independent of the duties,
obligations and liabilities of the other Borrower. The Loan Documents
are a primary and original obligation of each Borrower, are not the
creation of a surety relationship, and are an absolute, unconditional,
and continuing promise of payment and performance which shall remain
in full force and effect without respect to future changes in
conditions, including any change of law or any invalidity or
irregularity with respect to the Loan Documents. Each Borrower
acknowledges that the obligations of such Borrower undertaken herein
might be construed to consist, at least in part, of the guaranty of
obligations of persons or entities other than such Borrower (including
any other Borrower party hereto) and, in full recognition of that
fact, each Borrower consents and agrees that the Bank may, at any time
and from time to time, without notice or demand, whether before or
after any actual or purported termination, repudiation, or revocation
of this Agreement by any one or more Borrowers, and without affecting
the enforceability or continuing effectiveness hereof as to each
Borrower: (a) decrease or waive, the Obligations or any part thereof,
(b) accept partial payments on the Obligations; (c) receive and hold
additional security or guaranties for the Obligations or any part
thereof; (d) release, reconvey, terminate, waive, abandon, fail to
perfect, subordinate, exchange, substitute, transfer, or enforce any
security or guaranties, and apply any security and direct the order or
manner of sale thereof as the Bank in its sole and absolute discretion
may determine; (e) release any Person from any personal liability with
respect to the Obligations or any part thereof; (f) settle, release on
terms satisfactory to the Bank or by operation of applicable laws, or
otherwise liquidate or enforce any Obligations and any security
therefor or guaranty thereof in any manner, consent to the transfer of
any security and bid and purchase at any sale; or (g) consent to the
merger, change, or any other restructuring or termination of the
corporate or partnership existence of any Borrower or any other
Person, and correspondingly restructure the Obligations, and any such
merger, change, restructuring, or termination shall not affect the
liability of any Borrower or the
First Amendment to the Promissory Note, Addendum to Promissory Note
and Credit Agreement
Alliance Pharmaceutical Corp.
Page 2
continuing effectiveness hereof, or the enforceability hereof with respect
to all or any part of the Obligations.
Upon the occurrence and during the continuance of any Event of
Default, the Bank may enforce this Agreement independently as to each
Borrower and independently of any other remedy or security the Bank at
any time may have or hold in connection with the Obligations, and it
shall not be necessary for the Bank to marshal assets in favor of any
Borrower or any other Person or to proceed upon or against or exhaust
any security or remedy before proceeding to enforce this Agreement.
Each Borrower expressly waives any right to require the Bank to
marshal assets in favor of any Borrower or any other Person or to
proceed against any other Borrower or any Collateral provided by any
Person, and agrees that the Bank may proceed against Borrowers or any
Collateral in such order as it shall determine in its sole and
absolute discretion.
The Bank may file a separate action or actions against any
Borrower, whether action is brought or prosecuted with respect to any
security or against any other person, or whether any other person is
joined in any such action or actions. Each Borrower agrees that the
Bank and any Borrower and any affiliate of any Borrower may deal with
each other in connection with the Obligations or otherwise, or alter
any contracts or agreements now or hereafter existing between any of
them, in any manner whatsoever, all without in any way altering or
affecting the continuing efficacy of this Agreement.
The Bank's loan hereunder shall be reinstated and revived, and
the enforceability of this Agreement shall continue, with respect to
any amount at any time paid on account of the Obligations which
thereafter shall be required to be restored or returned by the Bank,
all as though such amount had not been paid. The rights of the Bank
created or granted herein and the enforceability of this Agreement at
all times shall remain effective to cover the full amount of all the
Obligations even though the Obligations, including any part thereof or
any other security or guaranty therefor, may be or hereafter may
become invalid or otherwise unenforceable as against any Borrower and
whether or not any other Borrower shall have any personal liability
with respect thereto.
To the maximum extent permitted by applicable law and to the
extent that a Borrower is deemed a guarantor, each Borrower expressly
waives any and all defenses now or hereafter arising or asserted by
reason of (a) any disability or other defense of any other Borrower
with respect to the Obligations, (b) the unenforceability or
invalidity of any security or guaranty for the Obligations or lack of
perfection or continuing perfection or failure of priority of any
security for the Obligations, (c) the cessation for any cause
whatsoever of the liability of any other Borrower (other than by
reason of the full payment and performance of all Obligations), (d)
any failure of the to marshal assets in favor Bank of any Borrower or
any other person, (e) any failure of the Bank to
First Amendment to the Promissory Note, Addendum to Promissory Note
and Credit Agreement
Alliance Pharmaceutical Corp.
Page 3
give notice of sale or other disposition of collateral to any Borrower or
any other Person or any defect in any notice that may be given in
connection with any sale or disposition of collateral, (f) any failure of
the Bank to comply with applicable law in connection with the sale or other
disposition of any collateral or other security for any Obligation,
including any failure of the Bank to conduct a commercially reasonable
sale or other disposition of any collateral or other security for any
Obligation, (g) any act or omission of the Bank or others that directly or
indirectly results in or aids the discharge or release of any Borrower or
the Obligations or any security or guaranty therefor by operation of law or
otherwise, (h) any law which provides that the obligation of a surety or
guarantor must neither be larger in amount nor in other respects more
burdensome than that of the principal or which reduces a surety's or
guarantor's obligation in proportion to the principal obligation, (i) any
failure of the Bank to file or enforce a claim in any bankruptcy or other
proceeding with respect to any Person, (j) the election by the Bank of the
application or non-application of Section 1111(b)(2) of the United States
Bankruptcy code, (k) any extension of credit or the grant of any lien under
Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Bankruptcy code, (1) any use of cash
collateral under Section 363 of the United States Bankruptcy Code, (m) any
agreement or stipulation with respect to the provision of adequate
protection in any bankruptcy proceeding of any Person, (n) the avoidance of
any lien in favor of the Bank for any reason, or (o) any action taken by
the Bank that is authorized by this section or any other provision of any
Loan Document. Until such time as all of the Obligations have been fully,
finally, and indefeasibly paid in full in cash: (i) each Borrower hereby
waives and postpones any right of subrogation it has or may have as against
any other Borrower respect to the Obligations; and (ii) in addition, each
borrower also hereby waives and postpones any right to proceed or to seek
recourse against or with respect to any property or asset of any other
Borrower. Each borrower expressly waives all setoffs and counterclaims and
all presentments, demands for payment or performance, notices of nonpayment
or nonperformance, protests, notices of protest, notices of dishonor and
all other notices or demands of any kind or nature whatsoever with respect
to the Obligations, and all notices of acceptance of this Agreement or of
the existence, creation or incurring of new or additional Obligations.
In the event that all or any part of the Obligations at any
time are secured by any one or more deeds of trust or mortgages or
other instruments creating or granting liens on any interests in real
property, each Borrower authorizes the Bank, upon the occurrence of
and during the continuance of any Event of Default, at its sole
option, without notice or demand and without affecting the obligations
of any Borrower, the enforceability of this Agreement, or the validity
or enforceability of any Liens of the Bank , to foreclose any or all
of such deeds of trust or mortgages or other instruments by judicial
or nonjudicial sale.
To the fullest extent permitted by applicable law, to the extent
that a Borrower is deemed a guarantor, each Borrower expressly waives
any
First Amendment to the Promissory Note, Addendum to Promissory Note
and Credit Agreement
Alliance Pharmaceutical Corp.
Page 4
defenses to the enforcement of this Agreement or any rights of the Bank
created or granted hereby or to the recovery by the Bank against any
Borrower or any other Person liable therefor of any deficiency after a
judicial or nonjudicial foreclosure or sale, even though such a foreclosure
or sale may impair the subrogation rights of Borrowers and may preclude
Borrowers from obtaining reimbursement or contribution from other
Borrowers. To the fullest extent permitted by applicable law, each
Borrower expressly waives any suretyship defenses or benefits that it
otherwise might or would have under applicable law. WITHOUT LIMITING THE
GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH IN THIS
SECTION, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, EACH BORROWER
WAIVES ALL RIGHTS AND DEFENSES ARISING OUT OF AN ELECTION OF REMEDIES BY
THE BANK, EVEN THOUGH THAT ELECTION OF REMEDIES, SUCH AS A NONJUDICIAL
FORECLOSURE WITH RESPECT TO SECURITY FOR THE OBLIGATIONS, HAS DESTROYED
SUCH BORROWER'S RIGHTS OF SUBROGATION AND REIMBURSEMENT AGAINST THE OTHER
BORROWERS BY THE OPERATION LAW, INCLUDING BUT NOT LIMITED TO SECTION 580D
OF THE CODE OF CIVIL PROCEDURE, OR OTHERWISE.
Borrower and each of them warrant and agree that each of the
waivers and consents set forth herein are made after consultation with
legal counsel and with full knowledge of their significance and
consequences, with the understanding that events giving rise to any
defense or right waived may diminish, destroy or otherwise adversely
affect rights which Borrower otherwise may have against any other
Borrower, the Bank or others, or against Collateral. If any of the
waivers or consents herein are determined to be contrary to any
applicable law or public policy, such waivers and consents shall be
effective to the maximum extent permitted by law.
2. Except as provided above, the Agreement remains unchanged.
3. This Amendment is effective as of August 2, 1999, and the parties hereby
confirm that Agreement is in full force and effect.
(SIGNATURE LINES ON NEXT PAGE)
First Amendment to the Promissory Note, Addendum to Promissory Note
and Credit Agreement
Alliance Pharmaceutical Corp.
Page 5
ALLIANCE PHARMACEUTICAL CORP.
"BORROWER"
By: /s/ Xxxxxxxx X. Xxxx
---------------------------------------------
Printed Name: Xxxxxxxx X. Xxxx
-----------------------------------
Title: President
------------------------------------------
By: /s/ Xxx X. Xxxx
---------------------------------------------
Printed Name: Xxx X. Xxxx
-----------------------------------
Title: VP & CFO
------------------------------------------
MDV TECHNOLOGIES, INC.
"BORROWER"
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------------------
Printed Name: Xxxxx X. Xxxxxxx
-----------------------------------
Title: Assistant Secretary
------------------------------------------
By: /s/ Xxxxxxxx X. Xxxx
---------------------------------------------
Printed Name: Xxxxxxxx X. Xxxx
-----------------------------------
Title: VP/Treasurer/Secretary
------------------------------------------
IMPERIAL BANK
"BANK"
By: /s/ Xxx Xxxxxxx
---------------------------------------------
Xxx Xxxxxxx, Senior Vice President
