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EXHIBIT 10.4.23
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LOAN AGREEMENT
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This agreement is made effective April 16, 1998, between Neoprobe
Corporation, a Delaware corporation ("Borrower"), and Bank One, NA, a national
banking association ("Lender").
Background Information
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A. Borrower has applied to Lender for a $3,000,000 revolving line of
credit (the "Revolving Loan").
B. Lender has approved Borrower's application for the Revolving Loan by
the commitment letter dated April 2, 1998 (the "Loan Commitment"), and Lender is
willing to make the Revolving Loan to Borrower but only on the terms and subject
to the conditions set forth in the Loan Commitment, this agreement, and the Loan
Documents (defined in Section 2, below).
C. Pursuant to the Loan Commitment, Lender is also providing two other
credit facilities to Borrower in the form of a $100,000 unsecured foreign
exchange line of credit (the "Unsecured FX Loan") and a $500,000 equipment
financing line of credit (the "Equipment Loan").
Statement of Agreement
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Borrower and Lender acknowledge the accuracy of the foregoing
Background Information and hereby agree as follows:
Section 1. Loan; Use of Loan Proceeds. On the terms and subject to the
conditions set forth in this agreement, the Loan Commitment, and the Loan
Documents (as defined below), Lender shall lend to Borrower on a revolving
basis, in one or more loans, advances of funds, or other extensions of credit,
including without limitation the face amount of any outstanding letters of
credit issued by Lender on Borrower's behalf (each, an "Advance"), from time to
time during the period beginning on the date of this agreement and ending on
February 28, 1999 (the "Availability Period"), an amount up to, but not in
excess of, the amount then available under the Borrowing Base (as defined
below); provided that the Bank shall not be obligated to make any Advance
hereunder if immediately after giving effect to the requested Advance, the
aggregate unpaid principal amount of all Advances outstanding would exceed the
amount then available under the Borrowing Base. The aggregate unpaid principal
amount of all Advances outstanding on February 28, 1999 (the "Termination Date")
shall be due and payable on the Termination Date. After the Termination Date,
the Borrower shall not be entitled to receive and the Lender shall not be
obligated to make or otherwise fund any Advance. Borrower shall use the proceeds
of the Revolving Loan to finance temporary working capital and capital
expenditures needs.
For purposes of this agreement, the "Borrowing Base" as of any given
date shall be the lesser of $3,000,000 or the sum of:
(a) 80% of the aggregate amount of Borrower's accounts receivable from
United States-domiciled persons or entities, which accounts are not
aged more than 120 days beyond their respective invoice dates; and
(b) the lesser of $1,000,000 or 35% of finished goods of the instrument
inventory (the "Finished Instrument Inventory"). For purposes of
calculating the Borrowing Base, the value of the Finished Instrument
Inventory shall be the purchase price paid therefor by Borrower to the
manufacturer of such Finished Instrument Inventory.
Within the limits of this agreement, the Borrower may borrow, repay,
and reborrow under this section.
Section 2. Evidence of Indebtedness and Security for the Revolving
Loan. The Revolving Loan shall be evidenced by a Revolving Variable Rate
Cognovit Promissory Note (the "Revolving Note"), a copy of which is attached to
this agreement as Exhibit A and incorporated into this agreement by reference.
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The Revolving Note, including all extensions, renewals, amendments,
modifications and replacements thereof, along with all of Borrower's obligations
under this agreement and the other Loan Documents (defined below), shall be
secured by:
(a) A first priority security interest in all inventory and accounts
receivable of Borrower and all proceeds thereof (collectively the
"Collateral");
(b) UCC-1 Financing Statements to perfect Lender's security interest in
the Collateral (the "UCC Financing Statements") which shall be filed
with the following:
(1) Ohio Secretary of State.
(2) Franklin County, Ohio Recorder, Personal Property Records.
(3) Colorado Secretary of State.
The security interest described in (a) shall be in the form of a
Security Agreement between Borrower and Lender (the "Security Agreement"). The
Loan Agreement, Revolving Note, Security Agreement, and UCC Financing Statements
shall be referred to collectively as the "Loan Documents."
Section 3. Rate of Interest; Terms of Payments; Late Charges;
Prepayment Charges; and Default. The rate of interest, terms of payment, late
charges, prepayment charges, and default rates for the Revolving Loan shall be
those set forth in the Revolving Note and this agreement.
Section 4. Term of Loans. The principal balance of the Revolving Note
and accrued interest thereon shall be due and payable in accordance with the
Revolving Note, and the entire unpaid principal balance of the Revolving Note
and all accrued and unpaid interest thereon shall be due and payable on or
before the "Maturity Date" as set forth in the Revolving Note.
Section 5. Fees. At the closing of the Revolving Loan (the "Closing"),
Borrower shall pay to Lender a loan fee of $2,500 (the "Commitment Fee").
Section 6. Costs and Expenses. In addition to the payment of the
Commitment Fee, Borrower shall pay or reimburse Lender, as applicable, for all
of Lender's out-of-pocket costs and expenses relating to, or incidental with,
the Revolving Note, including without limitation recording and filing fees,
title examination and insurance costs, escrow fees, appraiser's fees, engineer's
fees, environmental audit fees, inspection fees, surveyor's fees, costs and
expenses relating to administration of the Revolving Note, and Lender's
attorneys' fees (including costs and expenses) whether incurred before or after
the Closing (collectively, "Lender's Costs"); provided that Borrower shall have
no obligation to pay or reimburse Lender for Lender's attorneys' fees (including
without limitation costs and expenses) in excess of $4,000.
Section 7. Depository Requirements. While any sums advanced under the
Revolving Loan remain outstanding, Borrower shall maintain its primary
depository/cash management relationship with Lender in form and content
acceptable to Lender.
Section 8. Representations, Warranties, and Affirmative Covenants.
Borrower represents, warrants, and covenants, as applicable, that all of the
following statements are true and correct as of the date of this agreement and
shall continue to be true and correct until such time as the Revolving Note is
paid in full and all of Borrower's obligations under this agreement and the Loan
Documents are satisfied in full:
(a) Borrower is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware and is qualified
to do business and is in good standing in all jurisdictions in which it
is required to be so qualified, including without limitation in the
State of Ohio, and has the corporate power and authority to own its
properties and assets and to transact the business in which it is
engaged.
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(b) There has been no material adverse change in Borrower's financial
statements and other documents and materials submitted to Lender with
Borrower's application for the Revolving Loan since the period covered
by such statements, documents and materials.
(c) Borrower has not employed or engaged any broker, finder, or agent
who may claim a commission or fee relating to the Revolving Loan, and
Borrower shall indemnify and hold Lender harmless from any such claim,
demand, or litigation resulting therefrom.
(d) Borrower has full power and authority to execute and deliver this
agreement and the Loan Documents and to perform and observe its
obligations under this agreement and the Loan Documents; and this
agreement and the Loan Documents have been duly and validly executed
and delivered by Borrower and are the legal, valid, and binding
obligations of Borrower enforceable in accordance with their respective
terms.
(e) Neither the execution or delivery of this agreement or the Loan
Documents, nor the consummation of any of the transactions contemplated
by this agreement or the Loan Documents, nor compliance with the terms
and provisions of this agreement or the Loan Documents, will contravene
or conflict with: (i) any provision of law, statute, or regulation to
which Borrower or any of its properties is subject; (ii) any judgment,
license, order, or permit applicable to Borrower or any of its
properties; (iii) any indenture, mortgage, or other agreement or
instrument to which Borrower is a party or by which Borrower or any of
its properties is subject or bound; or (iv) Borrower's certificate of
incorporation, bylaws, qualifications to do business in any state, or
any actions or proceedings of Borrower. No consent, approval,
authorization, or order of any court or governmental authority or third
party is required in connection with the execution, delivery, and
performance by Borrower of this agreement or the Loan Documents.
Borrower shall promptly provide Lender with certified copies of the
documents used to effectuate any amendments to its certificate of
incorporation, bylaws, or other organizational documents, as the case
may be.
(f) Borrower is not in default under any agreement, indenture,
mortgage, deed of trust, security agreement, lease, franchise, or other
obligation to which it is a party or by which it or any of its property
is bound. Borrower is not in violation of any law, ordinance,
governmental rule, or regulation to which it is subject, which
violation might materially adversely affect the business, prospects,
profits, properties, or financial condition of Borrower. No event has
occurred and is continuing which constitutes an Event of Default (as
defined in Section 12, below) or would, with the lapse of time or
giving of notice or both, constitute such a default.
(g) Borrower shall comply with all applicable laws, rules, regulations,
and all orders of any governmental authority, a breach of which could
materially and adversely affect its business or credit.
(h) There are no claims, suits, or causes of action (whether legal,
equitable, or administrative) pending or threatened against Borrower
which will or may adversely affect the properties, business, prospects,
profits, or financial condition of Borrower or the ability of Borrower
to consummate or perform the transactions contemplated by this
agreement or the Loan Documents.
(i) Borrower is not in default or delinquent in the payment of any type
of tax or assessment with any governmental entity.
(j) Borrower is not a party to any contract or agreement which is not
referred to herein, contemplated hereby, or previously disclosed in
writing to Lender, which materially adversely affects Borrower. There
is no fact that Borrower has not disclosed in writing to Lender which
could materially or adversely affect the properties, business,
prospects, or conditions (financial or other) of Borrower. Borrower
shall comply in all material respects with all material agreements,
indentures, mortgages or documents binding on it or affecting its
properties or business.
(k) Borrower shall use the proceeds of the Revolving Loan solely for
those uses permitted under Section 1.
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(l) Borrower shall furnish to Lender, promptly upon becoming aware of
the existence of any condition or event constituting an Event of
Default or which, with the giving of notice or lapse of time or both,
would constitute an Event of Default under this agreement or any Loan
Document, a written notice specifying the nature and period of
existence thereof and what action Borrower is taking or proposes to
take with respect thereto.
(m) Upon becoming aware thereof, Borrower shall promptly notify Lender
in writing of (i) any material adverse change in its financial
condition or business, (ii) any default under any material agreement,
contract or other instrument to which Borrower is a party or by which
any of its properties are bound, or any acceleration of the maturity of
any indebtedness owing by Borrower, and (iii) any material adverse
claim against or affecting Borrower.
(n) Borrower shall maintain proper books of account and records
containing entries of all of the transactions entered into by Borrower
in accordance with generally accepted accounting principles.
(o) Borrower shall preserve and maintain its corporate existence and
all of its rights, privileges and franchises necessary or desirable in
the normal conduct of its business, and conduct its business in an
orderly and efficient manner consistent with good business practices
and in accordance with all valid regulations and orders of any
governmental authority.
(p) Upon reasonable advance notice (oral or written), Borrower shall
provide Lender and Lender's employees and agents access to the
Collateral to examine the existence and condition of such Collateral,
which shall include but not be limited to reviewing (and making copies
of) all of Borrower's books and records.
(q) All of the properties and operations of Borrower of a character
usually insured by persons or entities of established reputation
engaged in the same or similar business similarly situated are
adequately insured, by financially sound and reputable insurers,
against loss or damage of the kinds and in the amounts customarily
insured against by such persons or entities; and Borrower carries, with
one or more such insurers, in customary amounts, such other insurance,
including public and product liability insurance, as is usually carried
by persons or entities of established reputation engaged in the same or
a similar business similarly situated. Borrower shall maintain workers'
compensation insurance, liability insurance, casualty insurance and
other insurance on its present and future properties, assets and
business against such casualties, risks and contingencies, and in such
types and amounts, as are prudent and customary in the industry and as
Lender may from time to time reasonably request.
(r) Borrower shall pay when due all taxes, assessments, and other
governmental charges imposed upon it or its assets, franchises,
business, income, or profits before any penalty or interest accrues
thereon, and all claims (including without limitation claims for labor,
services, materials, and supplies) for sums which by law might be a
lien or charge upon any of its assets; provided that (unless any
material item or property would be lost, forfeited, or materially
damaged as a result thereof) no such charge or claim need be paid if it
is being diligently contested in good faith by Borrower, if Lender is
notified in advance of such contest, and if Lender receives adequate
reserve or other appropriate security acceptable to Lender to protect
the Lender against any loss therefrom.
(s) Borrower shall deliver, or cause to be delivered, to Lender: (i)
all Forms 10-Q and 10-K filed with the Securities and Exchange
Commission during the Availability Period within 30 days after such
filing; (ii) monthly and annual covenant compliance certificates for
Borrower certified as being true, accurate, and complete by an officer
of Borrower, relating to those covenants described in Section 9,
10(a)(ii), 10(b), and 10(c), below, not later than 15 days after the
expiration of each calendar month and each fiscal year, as applicable,
of the Company; (iii) year-end financial statements prepared in
accordance with generally accepted accounting principles for Borrower,
audited by a firm of independent accountants, not later than 120 days
after the expiration of each fiscal year of Borrower; (iv) not later
than 15 days after the end of each calendar month during the
Availability Period, a monthly Borrowing Base certificate, certified
as being true, accurate, and
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complete by the treasurer of Borrower, calculating, as of the end of
such calendar month, the Borrowing Base as described in Section 1,
above, and providing a summary of accounts receivable agings and
Finished Instrument Inventory in such format as may be agreed upon by
Borrower and Lender; and (v) all other reasonable information or
documentation (financial or otherwise) relating to Borrower upon
request of Lender from time to time.
(t) Borrower has good and marketable title to all of its properties and
assets, including without limitation the Collateral. All such
properties and assets are free from liens, encumbrances, or other
adverse claims of any nature. Borrower shall not cause or permit any
other liens or encumbrances to affect or attach to any such properties
and assets, whether now owned or hereafter acquired, without the prior
written consent of Lender.
(u) All representations and warranties made by Borrower herein shall
survive the delivery of the Revolving Note and the making of the
Revolving Loan, and any investigation at any time made by or on behalf
of Lender shall not diminish Lender's rights to rely thereon. All
statements contained in any certificate or other instrument delivered
by or on behalf of Borrower by one of its officers under or pursuant to
this agreement or the other Loan Documents or in connection with the
transactions contemplated hereby or thereby shall constitute
representations and warranties made by Borrower hereunder.
Section 9. Negative Covenants. In addition to the affirmative covenants
set forth in Section 8, until such time as the Revolving Note is paid in full
and all of Borrower's obligations under this agreement and the Loan Documents
are satisfied in full, Borrower shall not (unless Lender consents in writing):
(a) Incur, create, assume, have outstanding, guarantee or otherwise be
or become directly or indirectly liable in respect of any Indebtedness
except Permitted Indebtedness.
For purposes of this Section 9(a), "Indebtedness" shall mean
(i) all obligations of Borrower for borrowed money (including without
limitation all notes payable and drafts accepted representing
extensions of credit, all obligations evidenced by bonds, debentures,
notes or other similar instruments and all obligations upon which
interest charges are customarily paid); (ii) all obligations under
conditional sale or other title retention agreements and all
obligations issued or assumed as full or partial payment for property,
whether or not any such obligations represent obligations for borrowed
money; (iii) all indebtedness secured by any Lien (as defined in
Section 9(b), below) existing on property owned or acquired by Borrower
subject to any such Lien, whether or not the obligations secured
thereby shall have been assumed; (iv) all indebtedness guaranteed
(other than by endorsement of negotiable instruments for collection in
the ordinary course of business), directly or indirectly, in any
manner, by Borrower, or in effect guaranteed, directly or indirectly,
by Borrower through an agreement contingent or otherwise: (A) to
purchase securities or indebtedness, (B) to purchase, sell or lease (as
lessee or lessor) property or to purchase or sell services primarily
for the purpose of enabling the debtor to make payment of the
indebtedness or to assure the owner of the indebtedness against loss,
(C) to supply funds to or in any other manner invest in the debtor, or
(D) to repay amounts drawn down by beneficiaries of letters of credit
(other than letters of credit arising out of the import of goods or
issued in lieu of performance bond on behalf of Borrower), whether or
not issued directly or indirectly for the account of Borrower; (v) all
indebtedness for which Borrower has agreed, contingently or otherwise,
to advance or supply funds; and (vi) indebtedness of any joint
venture, partnership or other person or entity for which Borrower is
liable. Indebtedness shall not include the long-term portion of
deferred federal income taxes.
For purposes of this Section 9(a), "Permitted Indebtedness"
shall mean (i) whenever consummated and without need for amendment of
this agreement, Borrower's proposed obligation as guarantor of up to
$4,000,000 under a proposed $12,000,000 credit facility among Borrower,
Neoprobe (Israel), LTD., and Bank Hapoalim, B.M.; (ii) up to an
aggregate of $500,000 in purchase money Indebtedness outstanding at any
time, provided that such purchase money Indebtedness shall be secured
by a purchase money security interest which attaches and is enforceable
against Borrower under the laws of one or more of the states within the
United States of America; and (iii) any other Indebtedness, provided
that such Indebtedness (A) shall be subordinated to all Indebtedness of
Borrower to Lender, the terms of which subordination shall be subject
to review and
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approval by Borrower and Lender; and (B) shall not cause Borrower to
violate the financial covenant described in Section 10(d), below.
(b) Create or suffer to exist any Lien upon any of its property or
assets (including without limitation the Collateral) now owned or
hereafter acquired, except Permitted Liens.
For purposes of this Section 9(b), "Lien" shall mean any lien,
mortgage, security interest, tax lien, pledge, encumbrance or
conditional sale or title retention arrangement, or any other interest
in property designed to secure the repayment of indebtedness, whether
arising by agreement or under any statute or law or otherwise.
For purposes of this Section 9(b), "Permitted Liens" shall
mean: (i) Liens securing Permitted Indebtedness of the type described
in clauses (i), (ii), and (iii) of the above definition of Permitted
Indebtedness; (ii) pledges or deposits made to secure payment of
workers' compensation, or to participate in any fund in connection with
workers' compensation, unemployment insurance, pensions, or other
social security programs; (iii) landlords' Liens for rent not yet due
and payable; (iv) Liens securing the payment of taxes due and payable
or claims of mechanics, materialmen, warehousemen, carriers, and
operators; and (v) Liens for taxes not yet due and payable; provided
that Liens of the types described in items (ii) through (iv) of this
definition shall be "Permitted Liens" only so long as: (A) the validity
or amount of such claims is being contested in good faith by
appropriate and lawful proceedings, and (B) levy and execution on such
Liens have been stayed and continue to be stayed.
(c) Make or have outstanding any loans, advances of funds, or other
extensions of credit to any person or entity.
(d) Except in the ordinary course of business, transfer, sell, assign,
convey, mortgage, encumber, hypothecate, lease, or otherwise dispose of
any of Borrower's properties, rights, assets, or business, including
without limitation the Collateral.
(e) Dissolve or liquidate, or merge or consolidate with or into any
other person or entity.
Section 10. Financial Covenants. Borrower has met or shall meet the
following financial conditions:
(a) Borrower's tangible net worth, determined under generally accepted
accounting principles:
(i) Was not less than $22,000,000 as of March 31, 1998; and
(ii) Shall be not less than (A) $17,000,000 as of June 30,
1998, (B) $16,500,000 as of September 30, 1998, and (C)
$15,000,000 as of December 31, 1998, and thereafter.
(b) Borrower has and shall maintain during the Availability Period a
ratio of current assets to current liabilities of not less than 2.5:1.
(c) Borrower has and shall maintain during the Availability Period an
aggregate balance of cash and investments of not less than $9,000,000,
net of borrowings against the Revolving Loan.
(d) Borrower has and shall maintain during the Availability Period a
ratio of total debt to tangible net worth of not more than 1:1.
Section 11. Closing Deliveries; Existence and Authority. At or prior to
the Closing, Borrower shall have delivered or caused to be delivered to Lender,
unless specifically waived by Lender in writing, the following items, each of
which shall be in form and content satisfactory to Lender:
(a) Fully-executed originals of this agreement and all of the Loan
Documents.
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(b) All items, instruments, documents, insurance policies,
certificates, and all other matters and documents required to be
furnished by Borrower at or prior to the Closing under this agreement,
the Loan Commitment, any of the Loan Documents or otherwise required by
Lender.
(c) Payment of the Commitment Fee and payment or reimbursement of all
of Lender's Costs.
(d) Confirmation satisfactory to Lender that no Event of Default exists
and no condition exists which through notice or passage of time or both
would cause or result in an Event of Default and that all
representations and warranties contained in this agreement, the Loan
Commitment, and all of the Loan Documents shall be true and complete in
all material respects.
(e) Copies of all applicable governmental permits required to operate
Borrower's business and evidence of, and compliance with, all
governmental laws, regulations, ordinances, and other requirements
pertaining thereto.
(f) Certificate of good standing for Borrower from the Secretary of
State of Delaware and certificate of good standing or foreign
qualification (or authorization to do business) for Borrower from the
Secretary of State of Ohio.
(g) Copy of Borrower's certificate of incorporation, and all amendments
thereto, as filed with the Delaware Secretary of State, certified by
Borrower's secretary as being true, accurate, and complete.
(h) Copy of Borrower's bylaws certified by the Borrower's secretary as
being true, accurate, and complete.
(i) Resolutions of Borrower approving the execution, delivery and
performance of this agreement, the Revolving Note, and all other Loan
Documents and the transactions contemplated herein and therein, each
duly adopted by the Board of Directors of Borrower, and accompanied by
a certificate of the secretary or assistant secretary of Borrower
stating that such resolutions are true and correct, have not been
altered or repealed, do not violate or conflict with Borrower's
certificate of incorporation, bylaws, other organizational documents,
or actions by the shareholders of Borrower, and are in full force and
effect.
(j) A certificate of the secretary of Borrower, which shall certify the
names of the officers of Borrower authorized to sign each of the Loan
Documents, together with the true signatures of such officers. Lender
may conclusively rely on such certificate until it shall receive a
further certificate of the secretary or assistant secretary of Borrower
canceling or amending the prior certificate and submitting the
signatures of the officers named in such further certificate.
(k) A comprehensive list of Borrower's places of business, certified by
an appropriate officer of Borrower as being true, accurate, and
complete.
(l) Any other documents, items, instruments, insurance policies,
certificates, and all other matters that Lender reasonably requests,
including without limitation a waiver, executed by RELA, Inc. (the
"Manufacturer"), of any and all of Manufacturer's rights, title and
interest in and to the Finished Instrument Inventory arising in
connection with the Finished Instrument Inventory being warehoused by
Borrower on the Manufacturer's premises after such Finished Instrument
Inventory is finished and titled in Borrower.
Section 12. Events of Default. The occurrence of any of the following
events shall be an Event of Default under this agreement and all of the Loan
Documents:
(a) The determination by Lender that any representation or warranty
made by Borrower in this agreement (including without limitation those
representations and warranties set forth in Section 8) or any of the
Loan Documents is untrue or was untrue in any material (as determined
by Lender) respect when made.
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(b) The failure by Borrower to pay the full amount of any installment
of interest or principal and interest when due under the Revolving
Note.
(c) The failure by Borrower to perform or observe any covenant,
condition, or obligation contained in this agreement or any of the Loan
Documents (excluding those monetary obligations covered under (b),
above, and excluding the representations and warranties covered under
(a), above) which failure continues uncured for 10 days after delivery
by Lender to Borrower of notice of such failure.
(d) The occurrence of any default described in Section 13.
(e) The filing of a voluntary or involuntary petition in bankruptcy or
insolvency or for reorganization, arrangement, adjustment, liquidation,
dissolution or composition or for the appointment of a receiver,
guardian, or trustee by or against Borrower.
(f) The making of an assignment for the benefit of creditors by
Borrower or Borrower's failure generally to pay its debts as they
become due.
(g) The appointment of a receiver or trustee for all or any portion of
the Collateral.
(h) The dissolution, merger, reorganization, or other change in the
corporate structure of Borrower, without the prior written consent of
Lender.
(i) The transfer or attempted transfer by Borrower of any legal or
equitable ownership interest in all or any portion of the Collateral
without the prior written consent of Lender, which consent may be
withheld in Lender's sole discretion.
(j) The entry of a judgment or lien against Borrower which judgment or
lien is not satisfied, discharged or bonded-off within 30 days after
the date of entry of such judgment or lien, or, with respect to any
collection action relating to such judgment or lien, in the event such
collection action is not stayed so as to prevent the issuance of a
certificate of judgment against Borrower within 30 days after the date
of entry of such judgment or lien.
(k) The concealment or removal by Borrower of any part of its property
with intent to hinder, delay, or defraud its creditors or any of them,
or the making or suffering of a transfer of any of its property which
may be fraudulent under any bankruptcy, fraudulent conveyance, or
similar law, or the making by Borrower of any transfer of its property
to or for the benefit of a creditor at a time when other creditors
similarly situated have not been paid, or any other action by Borrower
which results in Borrower permitting any creditor to obtain a lien upon
any of its property through legal proceedings which is not vacated
within 10 days from the date thereof.
Upon the occurrence of any of the above-described events, Lender may
declare the Revolving Note due and payable upon demand without presentment,
protest, notice, or demand of any kind. Borrower shall not have the opportunity
to cure any default if such failure is incapable of being cured, in Lender's
reasonable discretion, or if the failure is described under any of (a), (b),
(d), (e), (f), (g), (h), (i), and (j).
Section 13. Cross Default. Any default by Borrower of any obligation of
Borrower to Lender or any of Lender's affiliates, whether or not relating to the
Revolving Loan, including without limitation any default with respect to the
Unsecured FX Loan or the Equipment Loan, shall constitute an Event of Default
under this agreement and all of the Loan Documents.
Section 14. Procedure for Borrowing under Revolving Loan. Provided all
conditions described in this Section 14 are satisfied, Borrower may borrow under
the Revolving Loan on any Business Day (meaning a day other than a Saturday,
Sunday or other day on which commercial banks in Columbus, Ohio, are authorized
or required by law to close) provided that the Borrower gives the Lender
telephonic or written notice (each, a "Notice of Borrowing") which must
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be received by the Lender prior to 1:00 p.m., Columbus, Ohio, time, on the
requested Borrowing Date (as defined below) for each Revolving Loan
disbursement, specifying (i) the requested Borrowing Date of such borrowing,
which shall be a Business Day and (ii) the aggregate amount of such requested
borrowing. Each borrowing pursuant to the Revolving Loan shall be in an
aggregate principal amount equal to $50,000 plus whole multiples of $5,000;
provided that any borrowing with respect to which Borrower exercises its
Interest Rate Conversion Option (as defined in the Revolving Note) shall be in
an aggregate principal amount equal to $250,000 plus whole multiples of $5,000.
Upon receipt of each such Notice of Borrowing from the Borrower, the Lender
shall deposit such requested borrowing for the benefit of the Borrower on the
requested Borrowing Date, subject to the satisfaction of the terms and
conditions of this agreement, by crediting the loan account on the books of the
Lender in the amount of such requested borrowing. Lender is hereby authorized,
and may at its option, but shall have no obligation to, record the date and
amount of each borrowing made in connection with the Revolving Loan, and the
date and the amount of each payment or prepayment of principal thereof, on its
separate written or electronic records maintained in the ordinary course of its
business, and any such recordation shall constitute prima facie evidence of the
accuracy of the information so recorded; however, the failure of the Lender to
make such recordations shall not effect the obligations of the Borrower to repay
outstanding principal, interest or any other amounts due hereunder or under the
Revolving Note in accordance with the terms hereof and thereof. The obligation
of Lender to continue making disbursements pursuant to the Revolving Note until
the Maturity Date as set forth in the Revolving Note and this agreement is
subject to the full satisfaction, in the opinion of Lender, of each of the
following conditions:
(a) The representations, warranties and covenants made by Borrower in
this agreement or any other Loan Document, and any representations,
warranties and covenants made by Borrower which are contained in any
certificate, document or financial or other statement furnished at any
time under or in connection herewith or therewith, shall be true and
correct in all material respects as of the date the Lender makes a
disbursement to Borrower pursuant to the Revolving Note (the "Borrowing
Date").
(b) No Event of Default shall have occurred and be continuing on the
Borrowing Date.
(c) There shall have been no material adverse change in the financial
condition or business of either Borrower and its affiliates from the
date of the most recent monthly financials furnished to Lender prior to
the Borrowing Date.
(d) All resolutions, certificates, corporate and other proceedings and
all other documents and legal matters in connection with the
transactions contemplated by this agreement and the Loan Documents
shall have been provided prior to the Borrowing Date in form and
substance reasonably satisfactory to Lender.
Each time Lender makes an Advance to Borrower under the Revolving Note
pursuant to a request by Borrower, it shall constitute a representation,
warranty and covenant by Borrower that, as of the Borrowing Date, the conditions
contained in paragraphs (a), (b), (c) and (d) of this Section 14 have been fully
satisfied.
Section 15. Assignment. No rights under this agreement nor in or to the
proceeds of the Revolving Loan may be assigned by Borrower without the prior
written consent of Lender.
Section 16. Non-Waiver. No failure by either party to insist upon
strict compliance with any term of this agreement or to exercise any option,
enforce any right, or seek any remedy upon any default of the other party shall
affect, or constitute a waiver of, the first party's right to insist upon that
strict compliance, exercise that option, enforce that right, or seek that remedy
with respect to that default or any prior, contemporaneous, or subsequent
default. No custom or practice of the parties at variance with any provision of
this agreement shall affect, or constitute a waiver of, either party's right to
demand strict compliance with the provisions of this agreement.
Section 17. Notices. All notices and other communications under this
agreement to be made to either Lender or Borrower shall be in writing and shall
be deemed given when delivered personally, telecopied (which is confirmed
electronically), or mailed by registered or certified mail (return receipt
requested) or sent by Federal Express, UPS, or
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other nationally recognized overnight delivery service for overnight delivery to
that party at the address for that party (or at such other address for such
party as such party shall have specified in notice to the other party):
(a) If to Lender:
Bank One, NA
000 Xxxx Xxxxx Xxxxxx, Xxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000-0000
Attention: Xxxxx X. Xxxxx
Telecopy No. (000) 000-0000
With a copy to (which shall be sent by Lender):
Xxxxx & Xxxxxxxxx LLP
00 Xxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Telecopy No. (000) 000-0000
(b) If to Borrower:
Neoprobe Corporation
000 Xxxxx Xxxxx Xxxxx
Xxxxx 000
Xxxxxx, Xxxx 00000-0000
Attention: Xxxx Xxxxxxxxxx
Telecopy No. (000) 000-0000
Section 18. Governing Law. All questions concerning the validity or
meaning of this agreement or relating to the rights and obligations of the
parties with respect to performance under this agreement shall be construed and
resolved under the laws of Ohio.
Section 19. Venue. The parties to this agreement hereby designate the
Court of Common Pleas of Franklin County, Ohio, as a court of proper
jurisdiction and exclusive venue for any actions or proceedings relating to this
agreement; hereby irrevocably consent to such designation, jurisdiction, and
venue; and hereby waive any objections or defenses relating to jurisdiction or
venue with respect to any action or proceeding initiated in the Court of Common
Pleas of Franklin County, Ohio.
Section 20. Severability. It is the intention of the parties to comply
fully with all laws and public policies, and this agreement shall be construed
consistently with such laws and public policies to the extent possible. If and
to the extent that any court of competent jurisdiction is unable to so construe
any provision of this agreement and holds that provision to be invalid, that
invalidity shall not affect the remaining provisions of this agreement, which
shall remain in full force and effect.
Section 21. Time is of the Essence. Time is of the essence relating to
this agreement and with respect to all other obligations to be performed under
this agreement, but delay in the exercise by Lender of its rights hereunder
shall not be deemed a waiver of such right by Lender.
Section 22. Captions. The captions at the beginning of the sections and
several subsections of this agreement are not part of the context of this
agreement, but are only labels to assist in locating those sections and
subsections, and shall be ignored in construing this agreement.
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Section 23. Jury Trial Waiver. Borrower, after consulting or having the
opportunity to consult with legal counsel, knowingly, voluntarily and
intentionally waives any right it may have to a trial by jury in any action or
proceeding based upon or arising out of this agreement or any of the Loan
Documents or any course of conduct, dealings, statements, whether oral or
written, or actions of either party. Borrower shall not seek to consolidate, by
counterclaim or otherwise, any action in which a jury trial has been waived with
any other action in which a jury trial cannot be or has not been waived.
Section 24. No Third Party Benefit. This agreement is intended for the
exclusive benefit of the parties and their respective heirs, successors and
assigns. Nothing contained in this agreement shall be construed as creating any
rights or benefits in or to any third party.
Section 25. Complete Agreement. This document, along with the Loan
Documents, contains the entire agreement among the parties and supersedes any
prior discussions, negotiations, representations, or agreements among them
respecting the subject matter. No additions or other changes to this agreement
shall be made or be binding unless made in writing and signed by each party to
this agreement.
NEOPROBE CORPORATION BANK ONE, NA
By: /s/ Xxxx Xxxxxxxxxx By: /s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx, Vice President
Print Name: Xxxx Xxxxxxxxxx
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Its: Vice President Finance and Administration
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