LOAN MODIFICATION AGREEMENT
THIS LOAN MODIFICATION AGREEMENT (the "Agreement") is made this 31st day
of December, 1998, by and among HEALTHCARE IMAGING SERVICES, INC., a Delaware
corporation (the "Borrower"), and DVI FINANCIAL SERVICES INC. (the "Lender").
REFERENCES TO CAPITALIZED TERMS USED HEREIN ARE SET FORTH IN SECTION 1 HEREOF.
BACKGROUND
A. Pursuant to the Loan Agreement, Lender agreed to extend to Borrower the
Loan as evidenced by Borrower's Note.
B. Borrower's obligations to Lender under the Loan Agreement and the Note
are secured, inter alia, by the Collateral.
C. At Borrower's request, Lender has agreed to enter into this Agreement,
inter alia, to (i) ratify and confirm the obligations and liability of Borrower
to Lender under the Loan Documents, (ii) reaffirm, ratify and continue Lender's
liens on, and security interests in, certain assets of Borrower, (iii) amend
certain terms and conditions of the Loan Documents and (iv) extend an additional
term loan to Borrower in the principal amount of $118,271.88.
NOW, THEREFORE, in consideration of foregoing premises and intending to be
legally bound hereby, the parties hereto agree as follows:
TERMS
1. CAPITALIZED TERMS. For purposes of this Agreement:
"Borrower" means Healthcare Imaging Services, Inc., a Delaware corporation.
"Collateral" means all tangible and intangible property of Borrower pledged
and/or granted to Lender as security for the Loan.
"Lender" means DVI Financial Services Inc.
"Loan" means that certain $14,000,000.00 bridge loan extended by Lender to
Borrower under the Loan Documents.
"Loan Agreement" means that certain Loan and Security Agreement
dated September 30, 1998, to be effective October 1, 1998, by and between Lender
and Borrower.
"Loan Documents" means the Loan Agreement, the Note, all documents relating
to the Collateral, together with all documents collateral to any of the
foregoing, all as the same may have been modified, revised, supplemented,
replaced and/or amended from time to time.
"Note" means that certain Note dated September 30, 1998, to be effective
October 1, 1998, given by Borrower to Lender in the original principal amount of
$14,000,000.00.
All other capitalized terms used herein shall have the meanings set forth in the
Loan Agreement.
2. CONFIRMATION OF BACKGROUND. Borrower hereby ratifies, confirms and
acknowledges that the statements contained in the foregoing Background are true
and complete in all material respects and that the Loan Documents are valid,
binding and in full force and effect as of the date hereof and fully enforceable
against Borrower and its assets in accordance with the terms thereof.
3. GENERAL ACKNOWLEDGEMENTS. Borrower hereby acknowledges and agrees that:
(a) Neither this Agreement nor any other agreement entered in connection
herewith or pursuant to the terms hereof shall be deemed or construed to be a
compromise, satisfaction, reinstatement, accord and satisfaction, novation or
release of any of the Loan Documents, or any rights or obligations thereunder,
or a waiver by Lender of any of its rights under the Loan Documents or at law or
in equity;
(b) All liens, security interests, rights and remedies granted to Lender in
the Loan Documents are hereby renewed, confirmed and continued, and shall also
secure the performance by Borrower of its obligations hereunder; and
(c) It has no defense, set-off, counterclaim or challenge against the
payment of any sums owing under the Loan Documents, or the enforcement of any of
the terms or conditions thereof.
4. AMENDMENTS. The Loan Agreement shall be and is hereby amended as
follows:
(a) References to Term Loan. All references contained in Sections 1.1, 1.2,
2.1 and 3.1 to the (i) "Term Loan" shall be deemed to refer to "Term Loan 1.",
and (b) the "Note" shall be deemed to refer to "Note 1."
(b) New Term Loan.
(i) New Term Loan. Lender will lend to Borrower and Borrower will borrow
from Lender the aggregate amount of One Hundred Eighteen Thousand Two Hundred
Seventy-One Dollars and Eighty-Eight Cents ($118,271.88) (the "Term Loan 2").
Borrower's obligation to repay the Term Loan 2 shall be evidenced by Borrower's
promissory note (the "Note 2") in the face amount of One Hundred Eighteen
Thousand Two Hundred Seventy-OneDollars and Eighty-Eight Cents ($118,271.88),
which shall be in the form attached hereto as Exhibit "A-1", with the blanks
appropriately filled in.
(ii) Interest on Term Loan 2. Interest on the unpaid principal balance of
the Term Loan 2 will accrue until final payment thereof at the rate per annum
which is equal to twelve percent (12%).
(iii) Default Interest. Interest will accrue on the principal balance of
the Term Loan 2 after the occurrence of any Event of Default at a rate equal to
the Default Rate.
(iv) Principal and Interest Payments on the term Loan 2. Borrower will pay
the principal of the Term Loan and accrued interest thereon in accordance with
the terms of Note 2.
(v) Reference. At all times hereafter the following capitalized terms used
in the Loan Documents shall have the meanings set forth next to them, except to
the extent specifically provided in Section 1(a) above:
"Note" shall mean Note 1 and Note 2.
"Term Loan" shall mean Term Loan 1 and Term Loan 2.
"Loan Documents" shall include Note 2, that certain Security Agreement of
even date herewith given by Borrower to Lender and all other documents,
instruments and agreements executed and delivered in connection therewith, as
the same may be modified, revised, supplemented, replaced and/or amended from
time to time.
5. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and warrants,
which representations and warranties shall survive until all Bank Indebtedness
and all other obligations of the Borrower to Lender are paid and satisfied in
full, as follows:
(a) All representations and warranties of Borrower set forth in the Loan
Documents are true and complete as of the date hereof.
(b) No condition or event exists or has occurred which would constitute an
event of default under the Loan Documents (or would, upon the giving of notice
or the passage of time, or both constitute an event of default).
(c) The execution and delivery of this Agreement by Borrower and all
documents and agreements to be executed and delivered pursuant to the terms
hereof;
(i) has been duly authorized by all requisite corporate action by Borrower;
(ii) will not conflict with or result in the breach of or constitute a
default (upon the passage of time, delivery of notice or both) under Borrower's
Articles of Incorporation or By-Laws or any applicable statute, law, rule,
regulation or ordinance or any indenture, mortgage, loan or other document or
agreement to which Borrower is a party or by which any of them is bound or
affected; or
(iii) will not result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any of the property or assets of
Borrower, except liens in favor of the Lender or as permitted hereunder or under
the Loan Documents.
6. CERTAIN FEES, COSTS, EXPENSES AND EXPENDITURES. Borrower will pay all
of the Lender's expenses in connection with the review, preparation,
negotiation, documentation and closing of this Agreement and the consummation of
the transactions contemplated hereunder, including without limitation, fees,
disbursements, expenses, appraisal costs and fees and expenses of counsel
retained by Lender and all fees related to filings, recording of documents and
searches, whether or not the transactions contemplated hereunder are
consummated. Nothing contained herein shall limit in any manner whatsoever
Lender's right to reimbursement under any of the Loan Documents.
7. INCONSISTENCIES. To the extent of any inconsistency between the terms
and conditions of this Agreement and the terms and conditions of the Loan
Documents, the terms and conditions of this Agreement shall prevail. All terms
and conditions of the Loan Documents not inconsistent herewith shall remain in
full force and effect and are hereby ratified and confirmed by Borrower.
8. BINDING EFFECT. This Agreement and all rights and powers granted hereby
will bind and inure to the benefit of the parties hereto and their respective
permitted successors and assigns.
9. SEVERABILITY. The provisions of this Agreement and all other Loan
Documents are deemed to be severable, and the invalidity or unenforceability of
any provision shall not affect or impair the remaining provisions which shall
continue in full force and effect.
10. NO THIRD PARTY BENEFICIARIES. The rights and benefits of this Agreement
and the Loan Documents shall not inure to the benefit of any third party.
11. MODIFICATIONS. No modification of this Agreement or any of the Loan
Documents shall be binding or enforceable unless in writing and signed by or on
behalf of the party against whom enforcement is sought.
12. HOLIDAYS. If the day provided herein for the payment of any amount or
the taking of any action falls on a Saturday, Sunday or public holiday at the
place for payment or action, then the due date for such payment or action will
be the next succeeding business day.
13. LAW GOVERNING. This Agreement has been made, executed and delivered in
the Commonwealth of Pennsylvania and will be construed in accordance with and
governed by the laws of such Commonwealth (without giving effect to any
principles of conflicts of law).
14. EXHIBITS AND SCHEDULES. All exhibits and schedules attached hereto are
hereby made a part of this Agreement.
15. HEADINGS. The headings of the Articles, Sections, paragraphs and
clauses of this Agreement are inserted for convenience only and shall not be
deemed to constitute a part of this Agreement.
16. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
17. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement among
the parties hereto concerning the subject matter set forth herein and supersedes
all prior or contemporaneous oral and/or written agreements and representations
not contained herein concerning the subject matter of this Agreement.
18. ACKNOWLEDGEMENT OF CONFESSION OF JUDGMENT PROVISIONS. BORROWER
ACKNOWLEDGES AND AGREES THAT THE NOTE AND THE LOAN DOCUMENTS CONTAIN PROVISIONS
WHEREBY LENDER MAY ENTER JUDGMENT BY CONFESSION AGAINST BORROWER. BEING FULLY
AWARE OF ITS RIGHTS TO PRIOR NOTICE AND HEARING ON THE QUESTION OF THE VALIDITY
OF ANY CLAIMS THAT MAY BE ASSERTED AGAINST IT BY LENDER UNDER THE NOTES AND LOAN
DOCUMENTS, BEFORE JUDGMENT CAN BE ENTERED, BORROWER HEREBY WAIVES THESE RIGHTS
AND AGREES AND CONSENTS TO LENDER ENTERING JUDGMENT AGAINST BORROWER BY
CONFESSION. ANY PROVISION IN A CONFESSION OF JUDGMENT IN ANY OF THE LOAN
DOCUMENTS FOR AN ATTORNEY'S COLLECTION COMMISSION SHALL IN NO WAY LIMIT
BORROWER'S LIABILITY TO REIMBURSE LENDER FOR ALL LEGAL FEES ACTUALLY INCURRED BY
LENDER, EVEN IF SUCH FEES ARE IN EXCESS OF THE ATTORNEY'S COLLECTION COMMISSION
PROVIDED FOR IN SUCH CONFESSION OF JUDGMENT.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
the day and year first above written.
HEALTHCARE IMAGING SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: President
DVI FINANCIAL SERVICES INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Managing Director
