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EXHIBIT 4.3(b)(2)
Michigan Corporate Special Assets (10-60)
National 00000 Xxxxxxx Xxxx
Xxxx Xxxxxxxxxx Xxxxx, XX 00000-0000
March 21, 1997
Xx. Xxxx X. Xxx
Chief Financial Officer
Universal Standard Medical Laboratories, Inc.
00000 Xxxxxxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
RE: MODIFICATION TO SECOND AMENDED AND RESTATED BUSINESS LOAN
AGREEMENT AND RELATED DOCUMENTS DATED FEBRUARY 6, 1997
Dear Xx. Xxx:
On February 6, 1997, Michigan National Bank, a national banking
association (the "Bank") and Universal Standard Medical Laboratories, Inc., a
Michigan corporation (the "Borrower") entered into a Second Amended and
Restated Business Loan Agreement. Pursuant to the Loan Agreement, Bank has
extended to Borrower the following loans:
1. Line of Credit in the amount of Five Million, Five Hundred
Thousand and 00/100 Dollars ($5,500,000.00);
2. Term Loan in the amount of Six Million and 00/100 Dollars
($6,000,000.00);
3. Letter/Line of Credit-B in the amount Fifty Thousand and
00/100 Dollars ($50,000.00).
The loans described in the Loan Agreement shall be referred to in this letter
as the "Loans." The Loans are secured by certain collateral described in
Section V of the Loan Agreement.
The Borrower has requested that the Bank agree to certain modifications in the
Second Amended and Restated Business Loan Agreement and Related Documents.
Bank is willing to make the modifications, subject to the terms and conditions
contained in this letter. Therefore, for good and valuable consideration, the
receipt and sufficiency of which is expressly acknowledged, the parties agree
as follows:
1. Capitalized terms not defined in this Letter shall have the
same meaning given to them in the Second Amended and Restated
Business Loan Agreement.
2. Section III.A. of the Second Amended and Restated Business
Loan Agreement is amended to reach in its entirety as follows:
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USML
March 21, 1997
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"A. FINANCIAL REQUIREMENTS.
1. Maintain a Cash Flow Coverage Ratio at the
end of each of the following calendar
quarters, of:
(a) 10/1/96 through 12/31/96 - (2.50) to 1
(b) 1/1/97 through 3/31/97 - .70 to 1
(a) 4/1/97 through 6/30/97 - 1.50 to 1
(a) 7/1/97 through 9/30/97 - 1.75 to 1
(a) 10/1/97 through 12/31/97 - 2.00 to 1
2. At the end of each of the above calendar
quarters, Xxxxxxxx's total funded debt
excluding debt subordinated to the Bank and
approximately $20,000.00 if quarterly Seller
note interest payments to cash flow shall at
no time be greater than:
(a) 10/1/96 through 12/31/96 - (0.75) to 1
(b) 1/1/97 through 3/31/97 - 3.0 to 1
(a) 4/1/97 through 6/30/97 - 3.0 to 1
(a) 7/1/97 through 9/30/97 - 3.0 to 1
(a) 10/1/97 through 12/31/97 - 3.0 to 1
This ratio shall be calculated with a
numerator equal to total funded debt and a
denominator equal to EBITDA for the quarter
multiplied by 4.
3. Maintain a Current Ratio of not less than 1.0
to 1.0.
All financial requirements described in this
Section III.A. shall be calculated in
accordance with GAAP.
3. Except as described in this letter, the Loan Agreement and
Related Documents will remain in full force and effect. All
collateral securing the Loans will continue to secure the
Loans.
4. The modifications described in this letter shall not
constitute the establishment of a course of dealing between
the parties. Bank reserves, and Xxxxxxxx expressly
acknowledges that Bank has the right to deny any future
request for modification or waiver of any of the provisions of
the Loan Agreement or the Related Documents.
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USML
March 21, 1997
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5. The effectiveness of the modifications contained in this
letter are expressly conditioned on the receipt of a
modification fee in the amount of $5,000.00. However, Xxxx
agrees to refund the modification fee if Borrower is not in
default and makes payment in full of all outstanding
Indebtedness of Borrower by April 22, 1997.
6. Section IX.B. of the Second Amended and Restated Business Loan
Agreement provides for the payment by the Borrower of
reasonable expenses in connection with the preparation of any
amendments, modifications, waivers or consents with respect to
the Agreement. Michigan National Bank has expended $4,490.00
for internal legal costs for the preparation, review, waiver
and modification of the Second Amended and Restated Business
Loan Agreement. Bank requests payment of $4,490.00 as
reimbursement of internal legal costs.
7. This letter agreement shall be governed by and construed in
accordance with the laws of the State of Michigan. This
letter may be modified only by written instrument signed by
both parties to this letter.
If this letter accurately reflects the understanding of the parties,
please execute the letter in the indicated place and return it to me.
Very truly yours,
/s/ Xxxx X. Xxxxxxx
Xxxx X. Xxxxxxx
Corporate Asset Manager
This letter accurately reflects the understanding of the parties.
Universal Standard Medical Laboratories, Inc.
By: /s/ Xxxx X. Xxx Date: 3/21/
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Xxxx X. Xxx
Its: Vice President - Finance and Treasurer
