FIRST AMENDMENT TO LOAN AGREEMENT
THIS FIRST AMENDMENT ("Amendment") made as of this 13th day of April,
2001 among AMERICAN MEDICAL ALERT CORP., a New York corporation, having its
principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the
"Borrower"), HCI ACQUISITION CORP., a New York corporation, having its principal
place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ("HCI" or a
"Guarantor") and EUROPEAN AMERICAN BANK, a New York banking corporation, having
an office at ▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Bank").
W I T N E S S E T H :
WHEREAS, the Borrower, the Guarantor and the Bank entered into an
Amended and Restated Loan Agreement dated as of the 21st day of November, 2000
(hereinafter the "Agreement"); and
WHEREAS, the Bank has made loans to the Borrower as evidenced by
certain notes of the Borrower and specifying interest to be paid thereon; and
WHEREAS, the Borrower has requested that the Bank:
(i) reduce the maximum Commitment for Revolving Credit Loans to One
Million Seven Hundred Thousand ($1,700,000.00) Dollars;
(ii) cancel the Commitment for Term Loans;
(iii) waive the late delivery of certain financial information
required pursuant to Sections 5.01(b)(i), 5.01(b)(xii) and (5.01(b)(xiii) of the
Agreement;
(iv) waive the failure to deliver the medical alert units report for
December, 2000 and January, 2001 as required by Section 5.01(b)(xv) of the
Agreement;
(v) waive the Borrowing Base deficiency that existed as of December
31, 2000;
(vi) waive the failure of the Borrower to maintain the Minimum
Capital Base required as of December 31, 2000; and
(vii) amend the Minimum Capital Base requirements.
NOW, THEREFORE, in consideration of Ten ($10.00) Dollars and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Borrower, the Guarantors and the Bank do hereby agree as
follows:
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1. Defined Terms. As used in this Amendment, capitalized terms,
unless otherwise defined, shall have the meanings set forth in the Agreement.
2. Representations and Warranties. As an inducement for the Bank to
enter into this Amendment, the Borrower and each Guarantor represents and
warrants as follows:
A. That with respect to the Agreement and the Loan Documents
executed in connection therewith and herewith:
(i) There are no defenses or offsets to the
Borrower's or any Guarantor's obligations under the Agreement
as amended hereby, the Note or any of the Loan Documents or
any other agreements in favor of the Bank referred to in the
Agreement, and if any such defenses or offsets exist without
the knowledge of the Borrower or any Guarantor, the same are
hereby waived.
(ii) All of the representations and warranties made
by the Borrower and any Guarantor in the Agreement as amended
hereby are true and correct in all material respects as if
made on the date hereof, except for those made with respect to
a particular date, which such representations and warranties
are restated as of such date; and provided further that the
representations and warranties set forth in Section 4.01(f) of
the Agreement shall relate to the financial statements of the
Borrower for the fiscal year ended December 31, 1999; and the
nine month fiscal period ended September 30, 2000.
(iii) The outstanding aggregate principal balance of
the Loans as evidenced by the Notes is $1,300,000.00 and
interest has been paid through April 1, 2001.
3. Amendments. The following amendments are hereby made to the
Agreement:
(a) Section 2.01 of the Agreement is hereby deleted in its entirety
and replaced as follows:
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"SECTION 2.01. The Revolving Credit Loans. The Bank agrees, on
the date of this Agreement, on the terms and conditions of
this Agreement and in reliance upon the representations and
warranties set forth in this Agreement, to lend to the
Borrower prior to the Maturity Date such amounts as the
Borrower may request from time to time (individually, a
"Revolving Credit Loan" or collectively, the "Revolving Credit
Loans"), which amounts may be borrowed, repaid and reborrowed,
provided, however, that the aggregate amount of such Revolving
Credit Loans outstanding at any one time shall not exceed the
lesser of (i) One Million Seven Hundred Thousand
($1,700,000.00) Dollars, or (ii) the Borrowing Base (the
"Commitment"), or such lesser amount of the Commitment as may
be reduced pursuant to Section 2.19 hereof.
Each Revolving Credit Loan shall be a Prime Rate Loan
or a Eurodollar Loan as the Borrower may request subject to
and in accordance with Section 2.02. The Bank may at its
option make any Eurodollar Loan by causing a foreign branch or
affiliate to make such Loan, provided that any exercise of
such option shall not affect the obligation of the Borrower to
repay such Loan in accordance with the terms of the Revolving
Credit Note. Subject to the other provisions of this
Agreement, Revolving Credit Loans of more than one type may be
outstanding at the same time."
(b) The Commitment for Term Loans is hereby cancelled and the
Borrower hereby agrees that it shall have no availability for Term Loans.
(c) Section 5.03(b) of the Agreement is hereby deleted in its
entirety and replaced as follows:
"(b) Capital Base. The Borrower shall maintain at all times a
minimum Capital Base of at least the following:
Date Minimum Capital Base
---- --------------------
December 31, 2000 $7,895,000.00
March 31, 2001 $7,750,000.00
June 30, 2001 and
thereafter $7,900,000.00"
5. Waivers. The Bank hereby waives the following:
(i) the failure of the Borrower to timely deliver the annual
financial statements required pursuant to Section 5.01(b)(i) of the Agreement
within ninety (90) days after the end of the fiscal year ended December 31,
2000, provided that such statements are delivered not later than April 20, 2001
and are substantially similar to the draft financial statements previously
delivered to the Bank;
(ii) the failure of the Borrower to timely deliver a Borrowing
Base certificate for the month of December, 2000 as required pursuant to Section
5.01(b)(xii) of the Agreement;
(iii) the failure of the Borrower to deliver a Borrowing Base
certificate for the month of January, 2001 as required pursuant to Section
5.01(b)(xii) of the Agreement;
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(iv) the failure of the Borrower to timely deliver accounts
receivable agings for the months of December, 2000 and January, 2001 as required
pursuant to Section 5.01(b)(xiii) of the Agreement;
(v) the failure to deliver the medical alert units reports for
December, 2000 and January, 2001 as required by Section 5.01(b)(xv) of the
Agreement
(vi) the Borrowing Base deficiency that existed as of December
31, 2000, provided that such deficiency did not exceed $626,000.00; and
(vii) the failure of the Borrower to maintain a Minimum
Capital Base of $9,000,000.00 as of the fiscal year ended December 31, 2000,
provided that the actual Capital Base as of such date was at least
$7,895,000.00.
6. Effectiveness. This Amendment shall become effective upon the
occurrence of the following events and the receipt and satisfactory review by
the Bank and its counsel of the following documents:
(a) The Bank shall have received this Amendment, duly executed
by the Borrower and each Guarantor and an endorsement to the Revolving Credit
Note in the form of Exhibit A hereto, duly executed by the Borrower.
(b) The Bank shall have received copies of any and all
modifications of the documentation referred to in Section 3.01 of the Agreement
which could result in a Material Adverse Change.
(c) The Bank's counsel shall have been paid their fees and
disbursements in connection with this Amendment.
7. Governing Law. This Amendment shall be governed by, and construed
in accordance with, the laws of the State of New York.
8. Counterparts. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
9. Ratification. Except as hereby amended, the Agreement and all
other Loan Documents executed in connection therewith shall remain in full force
and effect in accordance with their originally stated terms and conditions. The
Agreement and all other Loan Documents executed in connection therewith, as
amended hereby, are in all respects ratified and confirmed.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the year and date first above written.
AMERICAN MEDICAL ALERT CORP.
By:/s/ ▇▇▇▇ Rhian
-------------------------------
▇▇▇▇ Rhian
Vice President - Operations
HCI ACQUISITION CORP.
By:/s/ ▇▇▇▇ Rhian
-------------------------------
▇▇▇▇ Rhian
Secretary
EUROPEAN AMERICAN BANK
By:/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Vice President
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EXHIBIT A
Endorsement No. 1
The undersigned, AMERICAN MEDICAL ALERT CORP. (the "Borrower")
and EUROPEAN AMERICAN BANK (the "Bank") hereby amend the Revolving Credit Note
of the Borrower dated as of November 21, 2000 to which this Endorsement No. 1 is
attached (the "Note") as hereinafter set forth. The Note has been issued
pursuant to the Loan Agreement described therein. The Loan Agreement has been
amended by an Amendment of even date herewith and this Endorsement No. 1 is to
amend the Note to conform to the Amendment. Accordingly, the Note is hereby
amended to the extent that the amount, the situs of execution and delivery, the
date and the first paragraph are deleted and the following is substituted
therefor:
$1,700,000.00 Uniondale, New York
April __, 2001
FOR VALUE RECEIVED, on May 31, 2002, AMERICAN MEDICAL ALERT CORP., a New York
corporation, having its principal place of business at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.,
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the "Borrower"), promises to pay to the order of
EUROPEAN AMERICAN BANK ("Bank") at its office located at ▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇, the principal sum of the lesser of: (a) One Million Seven
Hundred Thousand ($1,700,000.00) Dollars; or (b) the aggregate unpaid principal
amount of all Revolving Credit Loans made by Bank to Borrower pursuant to the
Agreement (as defined below).
Except as expressly amended by this Endorsement No. 1, all the terms
and conditions of the Note shall continue in full force and effect.
This Endorsement No. 1 shall be effective as of April __, 2001.
AMERICAN MEDICAL ALERT CORP.
By:
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▇▇▇▇ Rhian
Vice President - Operations
EUROPEAN AMERICAN BANK
By:
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Vice President