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EXHIBIT 10.53
SECOND AMENDMENT TO AGENTED LOAN AND SECURITY AGREEMENT
DATED APRIL 30, 1998 BETWEEN
POLYMEDICA CORPORATION,
LIBERTY MEDICAL SUPPLY, INC.,
POLYMEDICA HEALTHCARE, INC.,
POLYMEDICA SECURITIES, INC.
AND
BANKBOSTON, N.A.
This Second Amendment to Agented Loan and Security Agreement
(hereinafter, the "Amendment") is made as of this 12th day of March, 1999 by and
among POLYMEDICA CORPORATION, LIBERTY MEDICAL SUPPLY, INC., POLYMEDICA
HEALTHCARE, INC., AND POLYMEDICA SECURITIES, INC., (hereinafter, individually
and collectively, the "Principal Borrowers") and BANKBOSTON, N.A., a national
banking association with its principal place of business at 000 Xxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx (hereinafter, the "Lender"), in consideration of the
mutual covenants contained herein and the benefits to be derived herefrom.
Unless otherwise specified herein, all capitalized terms shall have the same
meaning as set forth in the Loan Agreement (as defined hereinbelow).
W I T N E S S E T H:
WHEREAS, the Principal Borrowers executed and delivered to the Lender a
certain Agented Loan and Security Agreement dated April 30, 1998, as amended by
a certain Waiver of Default and Amendment dated as of November 30, 1998,
(hereinbefore and hereinafter, as amended, the "Loan Agreement") pursuant to
which, among other things, the Lender extended in favor of the Principal
Borrowers a Revolving Credit in the current maximum principal amount of
$7,500,000.00; and
WHEREAS, the Principal Borrowers have requested that the Lender amend
the Loan Agreement to increase the maximum availability under the Revolving
Credit from $7,500,000.00 to $10,000,000.00; and
WHEREAS, the Lender has indicated its willingness to do so, BUT ONLY on
the terms and conditions contained in this Amendment; and
WHEREAS, the Principal Borrowers have determined that this Amendment is
in each of the Principal Borrower's best interest.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
14. The Principal Borrowers hereby certify to the Lender that, to
the best of each of the Principal Borrower's knowledge and belief after due
inquiry, the representations and warranties contained in the Loan Agreement, as
modified by this Amendment, are true as of the date hereof (except those of
which relate to a specific date, or to the extent such have become inaccurate
due to transactions permitted under the Loan Agreement)and that no Event of
Default under the Loan Agreement or any document executed in connection
therewith has occurred and is continuing.
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15. The Principal Borrowers acknowledge and agree that the none of
the Principal Borrowers have any offsets, defenses, claims or counterclaims
against the Lender with respect to the Loan Agreement, this Amendment or any
other document, instrument or agreement executed and delivered by the Principal
Borrowers to the Lender in connection therewith and, to the extent that any of
the Principal Borrowers have any such offsets, defenses, claims or
counterclaims, the Principal Borrowers hereby affirmatively WAIVE any such
offsets, defenses, claims or counterclaims and specifically RELEASE the Lender
for any such liability on account thereof.
16. The Principal Borrowers acknowledge and agree that all of
their obligations and liabilities to the Lender under the Amended and Restated
Master Note of even date executed in connection herewith, shall be included
within the definition of "Obligations" as used in the Loan Agreement, and the
payment and performance of such Amended and Restated Master Note, shall continue
to be secured by all assets of the Principal Borrowers, previously or hereafter,
granted to the Lender to secure the payment and performance of the Obligations.
17. Section 2-1(b) of the Loan Agreement is hereby deleted in its
entirety and the following substituted therefor:
As used herein, the term "AVAILABILITY" refers at any time to the
lesser of (i) or (ii) below:
(i) Up to the result of the following:
(A) Ten Million Dollars and No Cents ($10,000,000.00).
MINUS
(B) The then unpaid balance of the Loan Account.
MINUS
(C) The aggregate principal amounts then undrawn on all
outstanding L/C's issued or incurred, or caused to be
issued or incurred, by the Lender for the account
and/or benefit of any Principal Borrower.
(ii) Up to the result of the following:
(A) 75% of the face amount of each of the Principal
Borrower's Acceptable Accounts (as defined below).
PLUS
(B) 25% of the face amount of each of the Principal
Borrower's Acceptable Unbilled Accounts (as defined
below), which in the aggregate shall not exceed
$5,000,000.00.
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PLUS
(C) 50% of the value of the Acceptable Inventory of each
Principal Borrower, as defined below (Acceptable
Inventory being valued at the lower of cost or market
after deducting all transportation, processing,
handling charges, and all "soft" costs and expenses,
subject to such inventory reserves as the Lender may
establish from time to time).
MINUS
(D) The then unpaid principal balance of the Loan
Account.
MINUS
(E) The aggregate principal amounts then undrawn on all
outstanding L/C's issued or incurred, or caused to be
issued or incurred, by the Lender for the account
and/or the benefit of any Principal Borrower."
18. Article IV of the Loan Agreement is hereby amended by adding
the following definition of "Acceptable Unbilled Accounts" after the definition
of "Acceptable Accounts":
""ACCEPTABLE UNBILLED ACCOUNTS": Such of the Principal Borrowers'
rights to payment for goods sold, or services rendered, which have been earned
by performance and would otherwise be classified as Acceptable Accounts, but for
which an invoice has not yet been rendered."
19. Article IV of the Loan Agreement is hereby amended by deleting
the definition of "Master Note" in its entirety and substituting the following
therefor:
""MASTER NOTE": a certain Amended and Restated Master Note of even
date in the original face amount of $10,000,000.00 made by the
Agent Borrower and Principal Borrowers payable to the Lender, as
may be hereafter amended or replaced."
20. Article IV of the Loan Agreement is hereby amended by adding
the following definition of "Year 2000 Compliant" after the definition of
"Unused Line Fee":
""YEAR 2000 COMPLIANT": computer applications, imbedded microchips,
and other software systems and subsystems which properly
recognize and perform their intended function without any
material adverse effect on account of their respective inability
to recognize certain dates on and after December 31, 1999 or on
account of their treating any date prior to, on, or after
December 31, 1999 other than as the specific date in question."
21. Article VI of the Loan Agreement is hereby amended by adding
the following Section after Section 6-25:
"6-26. YEAR 2000 COMPLIANCE.
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(a) Based upon a diligent inquiry undertaken by the
Principal Borrowers, it appears that the Principal Borrowers'
operations are Year 2000 Compliant.
(b) The Principal Borrowers have developed a detailed
plan and timetable with respect to the Principal Borrowers' operations
becoming Year 2000 Compliant and it appears that the Principal
Borrowers have committed adequate resources to execute that plan and to
meet such timetable.
(c) The Principal Borrowers will not suffer or permit
their operations thereafter to cease to be Year 2000 Compliant in any
manner which might have a material adverse effect on their operations."
22. Exhibit 2-5 of the Loan Agreement is hereby amended by
deleting same in its entirety and substituting Exhibit 2-5 attached hereto and
specifically incorporated by reference herein therefor.
23. Exhibit 9-8 of the Loan Agreement is hereby amended by
deleting Section 5 thereof in its entirety effective as of December 31, 1998.
24. As a condition to precedent to the effectiveness of this
Amendment, the Principal Borrowers shall have paid to the Lender a closing fee
in the amount of $6,250.00, which fee shall be in addition to, and supplemental
of, all other fees required pursuant to the terms of the Loan Agreement.
25. This Amendment and all other documents, instruments or
agreements executed in connection herewith incorporate all discussions and
negotiations between the Principal Borrowers and the Lender, either expressed or
implied, concerning the matters included herein, any statute, custom, or usage
to the contrary notwithstanding. No such discussions or negotiations shall
limit, modify or otherwise affect the provisions hereof. No modification,
amendment, or waiver of any provision of this Amendment or the Loan Agreement or
any provision under any other agreement, document or instrument between the
Principal Borrowers and the Lender shall be effective unless executed in writing
by the party to be charged with such modification, amendment or waiver, and if
such party be the Lender, then by a duly authorized officer thereof.
26. Except as specifically modified herein, the Loan Agreement
shall remain in full force and effect as originally written and the Principal
Borrowers hereby ratify and confirm all terms and conditions contained therein
and further ratify and reaffirm all representations and warranties made therein
as of the date hereof.
27. This Amendment shall be construed in accordance with and
governed by the laws of the Commonwealth of Massachusetts and shall take effect
as a sealed instrument.
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IN WITNESS WHEREOF, the parties have hereunto set their hands
and seals as of the date first written above.
POLYMEDICA CORPORATION
By: /s/ Xxxx X. Xxxxxxx
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Title: CFO and Treasurer
LIBERTY MEDICAL SUPPLY, INC.
By: /s/ Xxxxxx X. Xxx
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Title: Treasurer
POLYMEDICA HEALTHCARE, INC.
By: /s/ Xxxx X. Xxxxxxx
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Title: Treasurer and Secretary
POLYMEDICA SECURITIES, INC.
By: /s/ Xxxx X. Xxxxxxx
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Title: Treasurer and Clerk
BANKBOSTON, N.A.
By: /s/ Xxxxxxx X. Xxxxxxx
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Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
