SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
Date of Report (Date of earliest event reported) December 3, 1999
DIALYSIS CORPORATION OF AMERICA
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(Exact name of registrant as specified in its charter)
Florida 0-8527 59-1757642
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
27 Miller Avenue, Lemoyne, Pennsylvania 17043
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (717) 730-6164
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Item 5. Other Events.
DCA of Vineland, LLC, a Delaware limited liability company ("Vineland"),
an 80% owned subsidiary of the Company, is establishing a new modern 15
station outpatient dialysis facility in Vineland, New Jersey. Vineland has
entered into a three-year credit facility with a Maryland bank to borrow up
to $700,000 at an annual interest rate of 8.75% for constructing and
equipping the facility. Vineland will draw down the funds as needed. The
Vineland dialysis facility is approximately two-thirds completed, with the
initial funds for the construction of approximately $365,000 provided by the
Company, which funds are to be repaid from the new bank financing.
In order to facilitate the financing, the Company provided the bank
with a second mortgage and security interest on the property it owns in
Easton, Maryland which consists of land and a 7,400 square foot building,
which it leases to a competitor who purchased the Company's Easton, Maryland
dialysis facility in 1989. The first mortgage is held by an affiliated bank
for the Company's 1988 financing. The outstanding balance on the first
mortgage from the Company is currently approximately $164,000.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Financial Statements of Businesses Acquired
Not Applicable
(b) Pro Forma Financial Information
Not Applicable
(c) Exhibits
(99) Additional Exhibits
(i) Indemnity Deed of Trust
(ii) Guaranty Agreement
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DIALYSIS CORPORATION OF AMERICA
/s/ Thomas K. Langbein
By-------------------------------------
THOMAS K. LANGBEIN, Chairman
of the Board and Chief Executive
Officer
Dated: December 8, 1999
INDEMNITY DEED OF TRUST
THIS INDEMNITY DEED OF TRUST is made as of this 3rd day of December,
1999, from Dialysis Corporation of America, a Florida corporation, (herein-
after referred to as "Grantor") to W. W. Duncan and Clifford L. Hilk, Sr.
("Trustees") as Trustees for the benefit of St. Michaels Bank ("Beneficiary").
R E C I T A L S
DCA of Vineland, LLC (hereinafter referred to as the "Borrower"), has
applied to St Michaels Bank, a Maryland banking corporation (hereinafter
referred to as the "Beneficiary"), for a loan in the principal amount of
$700,000.00 (the "Financial Accommodations"), which Financial Accommodations
are to be made by the Beneficiary in favor of the Borrower pursuant to the
terms and conditions of a Loan Agreement of even date herewith by and between
the Borrower and the Beneficiary (the "Loan Agreement") and are to be
evidenced by a Promissory Note of even date herewith from the Borrower
payable to the Beneficiary in the principal amount of the Financial
Accommodations (which Promissory Note, together with any modifications,
extensions, or renewals thereof, amendments thereto, or substitutions
therefor, is hereinafter referred to as the "Note"). Pursuant to the terms
and conditions of a Guaranty Agreement of even date herewith by the Grantor
to the Beneficiary (which Guaranty Agreement, together with any modifica-
tions, extensions, or renewals thereof, amendments thereto, or substitutions
therefor, is hereinafter referred to as the "Guaranty"), the Grantor has
guaranteed repayment of the Note.
The Grantor desires to secure the full and punctual payment of all
indebtedness due or to become due under the Guaranty and certain other
documents by the execution of these presents
1. DEFINITIONS - When capitalized in this Deed of Trust, the following
terms shall have the meaning given in this Section , unless the context
clearly indicates a contrary intent.
1.01 Loan Agreement - "Loan Agreement" means the agreement of
even date between DCA of Vineland, LLC and Beneficiary concerning, inter
alia, advances of the Loan proceeds, including all current and future
supplements, amendments and attachments thereto.
1.02 Controlling Party - "Controlling Party" means any Person,
directly or indirectly, possessing the power to direct or cause the direction
of the management and policies of Grantor, whether through the ownership or
control of voting securities or rights, by Contract or otherwise.
1.03 Default - "Default" means: (a) the failure of Grantor to
perform, cause to be performed, abide by, comply with, or observe any
material duty or obligation imposed upon Grantor by the Guaranty Agreement;
and (b) any event, happening, or condition which would constitute an Event
of Default if not cured within any applicable grace period.
1.04 Encumbrances - "Encumbrances" includes all liens, mortgages,
rights, leases, restrictions, easements, deeds of trust, covenants, agree-
ments, rights of way, rights of redemption, security interests, conditional
sales agreements, land installment contracts, options, and all other burdens
or charges.
1.05 Environmental Requirements - Environmental Requirements means
any federal, state or local law, statute, ordinance or regulation; or court
or administrative order or decree; or private agreement which requires
special handling, collection, storage, treat, disposal or removal of any
materials located in or on or about the Property.
1.06 Event of Default - "Event of Default" has the meaning given
and provided in Section.
1.07 Expense Account - "Expense Account" means the Account which
may be maintained pursuant to Section 5.02.
1.08 Land - "Land" means the land more particularly described in
Exhibit A to this Deed of Trust.
1.09 Legal Action - "Legal Action" includes all suits or other
proceedings brought at law or in equity or before any administrative
agency, governmental body, or arbitrator which in any manner relate to the
Trust Property or arise out of or relate to any of the Loan Documents.
1.10 Loan - "Loan" means the loan by the Beneficiary to the
Borrower in the principal amount of Seven Hundred Thousand Dollars
($700,000.00), or so much there of as may be advanced from time to time,
as evidenced by the Note. All amounts owed under the above agreement are
secured even though all amounts may not yet be advanced. Future advances
under the agreement are contemplated and will be secured and will have
priority to the same extent as if made on the date this instrument is
executed, it being understood that this Deed of Trust secures repayment
of future advances.
1.11 Loan Documents - Loan Documents" means this Deed of Trust,
the Note, the Loan Agreement, the Guaranty Agreement and any and all other
certificates, opinions, assignments and documents executed in connection
herewith or therewith, and all current and future supplements, amendments,
and attachments thereto.
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1.12 Permitted Encumbrances - "Permitted Encumbrances" means this
Deed of Trust and all Encumbrances as to which Beneficiary has given its
prior written approval, including, but not limited to: (a) a first Deed of
Trust and Security Interest for the benefit of Mercantile-Safe Deposit &
Trust Company dated November 30, 1988 and recorded among the Land Records
of Talbot County at Liber 662, folio 229; (b) an Assignment of Rents and
Leases dated November 30, 1998 and recorded at Liber 662, folio 255; and a
financing statement recorded among the aforesaid land records at Liber 662,
folio 266 and among the financing statement records at Liber 44, folio 458.
Any provisions in this deed of trust which require action by Grantor which
would contravene, or be impossible of performance because of, or which would
duplicate, any provision in the documents constituting and evidencing the
Permitted Encumbrances, shall be deemed satisfied by Grantor's performance
of the obligations of the Grantor set forth in the documents constituting
and evidencing the Permitted Encumbrances.
1.13 Property - "Property" has the meaning given in Section 2.02.
1.14 Proposed Sale - "Proposed Sale" means the Grantor's proposed
sale of substantially all of its assets to an affiliate (presently a 100%
owned subsidiary) of Medicore, Inc., the parent of the Grantor, subject to
Grantor's shareholder approval, which, if obtained, would result in
substantially all of the Grantors's assets, liabilities and operations
being 100% owned by its parent.
1.15 Risk - "Risk" includes risk of loss or damage by fire,
lightning, windstorm, hail, explosion, riot, riot attending a strike, civil
strife, civil commotion, aircraft, vehicles, smoke, vandalism, malicious
mischief, boiler explosion, and any other risk customarily insured against
by persons operating property similar in kind to the Trust.
1.16 Taking - "Taking" includes any taking by condemnation or
eminent domain, any sale in lieu of condemnation under threat thereof, the
alteration of the grade of any street, or any other injury to or decrease in
the value of the Trust Property by any public or quasi- public authority or
corporation or any other person having the power of eminent domain.
1.17 Taxes - "Taxes" includes all taxes, excises, documentary
stamp and transfer taxes, recording taxes, assessments, water rents, sewer
rents, metropolitan district charges, sanitary district charges, public dues,
and other public charges levied or assessed upon the Trust Property, upon the
Loan, or upon any Loan Document.
1.18 Trust Property - "Trust Property" has the meaning given in
Section 2.05
2. GRANTING CLAUSES
2.01 Lien on Real Property - Subject to the Permitted Encumbrances,
the Grantor, in consideration of the Loan and other valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, grants and
assigns to the Trustees all the Land situate in Talbot County, Maryland,
described more particularly in Exhibit A attached hereto as a part hereof,
together with (a) all buildings and improvements now or hereafter located
thereon, (b) all rights, rights of way, air rights, riparian rights,
franchises, licenses, easements, tenements, hereditaments, appurtenances,
accessions and other rights and privileges now or hereafter belonging to
the Land or the buildings and improvements thereupon, now owned or here-
after acquired by the Grantor.
2.02 Property - All of the property described in Sections 2.01 is
hereinafter called the "Property".
2.03 Lien on Leases and Rents and Other Rights - Subject to the
Permitted Encumbrances, the Grantor further grants and assigns to the
Trustees (a) all Leases and Rents, including, without limitation, all cash
or security deposits to secure performance by Tenants (whether such cash or
securities are to be held until the expiration of the terms of Leases or are
to be applied to one or more of the installments of rent coming due immedi-
ately prior to the expiration of such terms), (b) all of the estate, right,
title, use, claim and demand of every nature whatsoever, at law or in equity,
which the Grantor may now have or may hereafter acquire in and to the
Property, and (c) all right, title and interest of the Grantor in and to all
extensions, betterments, renewals, substitutes and replacements of, and all
additions and appurtenances to, the Property, hereafter acquired by or
released to the Grantor, or constructed, assembled or placed by or for the
Grantor on the Property, and all conversions of the security constituted
thereby.
2.04 Lien on Insurance Policies and Condemnation Awards - The
Grantor further grants and assigns to the Trustees all insurance policies and
insurance proceeds pertaining to the Property and all awards or payments,
including interest thereon and the right to receive the same, which may be
made with respect to any of the Property as a result of any taking or any
injury to or decrease in the value of the Property.
2.05 The Trust Property - All of the property described in this
Article 2.00 is collectively called the "Trust Property."
3. HABENDUM CLAUSE AND DEFEASANCES
The Trustees shall have and hold the Trust Property in fee simple,
upon the terms and trust herein set forth.. If all obligations of Grantor
under this Deed of Trust and the other Loan Documents are paid and satisfied
in accordance with the terms hereof and thereof, the estate hereby granted
shall cease and the Trust Property shall be released to the Grantor, at the
cost of the Grantor.
4. REPRESENTATIONS AND WARRANTIES
4.01 Warranty of Title and Further Assurances - Subject to the
Permitted Encumbrances, the Grantor warrants that it has the right and
authority to convey the Trust Property and warrants specially title to the
Trust Property and that it will execute such further assurances as may be
requested.
4.02 Purpose of the Loan - The Grantor warrants that the Loan is a
"commercial loan" as defined in the Commercial Law Article of the Annotated
Code of Maryland.
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4.03 Existence, Good Standing, Power and Authority of Grantor -
Grantor is a corporation of the State of Florida, is not required to register
to do business in Maryland, and will maintain its good standing and existence
in Florida, and in every other state in which it transacts business, until
all of Grantor's obligations under the Loan Documents have been performed and
satisfied. Subject to the Permitted Encumbrances, the execution and delivery
of the Loan Documents, the carrying out of the transactions contemplated by
the Loan Documents, and the performance of Grantor's and any guarantor's
obligations under the Loan Documents, have been duly authorized by all
necessary action and will not conflict with or result in a breach of Law or
any agreement or other instrument to which Grantor is bound. The Loan
Documents are valid and binding on the Borrower, and on Grantor as guarantor
thereof and are enforceable against Borrower and against Grantor in ac-
cordance with their respective terms, as applicable.
5. COVENANTS, RIGHTS, AND DUTIES OF GRANTOR GENERALLY
5.01 Covenant to Pay Loan and to Perform Obligations under the
Terms of the Loan Documents - The Grantor covenants that it will punctually
(a) perform and satisfy all of its obligations under the Guaranty Agreement,
and (b) perform and satisfy all other obligations of the Grantor under the
Loan Documents; (c) pay to the mortgagee the principal and interest due under
any Permitted Encumbrance according to the terms of such mortgage.
5.02 Expense Account -
5.02.01 Upon default, after the completion of the improvements contem-
plated by and described in the Construction Loan Agreement, the Grantor will
pay to the Beneficiary monthly installments, each of which shall be equal to
one-twelfth (1/12) of the sum of (a) the estimated annual premiums for all
insurance policies required by Sections 7.01, and 7.02, and (b) the estimated
annual Taxes pertaining to the Trust Property, to be held by the Beneficiary
in the Expense Account and disbursed by the Beneficiary to pay the insurance
premiums as they become due, and Taxes before any penalty or interest shall
accrue thereon. Estimates are to be made solely by the Beneficiary and
payments shall be made on the day of the month designated by the Beneficiary.
No interest shall be payable by the Beneficiary on the Expense Account unless,
and then only to the extent that, applicable Law shall otherwise require. All
overpayments to the Expense Account shall be applied to reduce future payments
to the Expense Account, if any, or shall be returned to the Grantor, in the
sole discretion of the Beneficiary.
5.02.02 Upon default, the Grantor shall pay such additional sums into
the Expense Account as the Beneficiary determines are necessary, so that one
month prior to the date the Beneficiary is required to make payments of
insurance premiums or Taxes, as the case may be, payments can be made
therefor out of the Expense Account.
5.02.03 The Grantor hereby grants the Beneficiary a security interest
in the sums on deposit in the Expense Account to secure the obligations
secured hereby, and upon the occurrence of an Event of Default, the Bene-
ficiary may, unless prohibited by applicable Law, apply the balance of the
Expense Account to satisfy Grantor's obligations under the Loan Documents.
5.03 Compliance with Laws - The Grantor shall comply with all Laws
a breach of which would materially and adversely affect (a) the financial
condition of the Grantor, (b) the ability to use buildings and other
improvements on the Land for the purposes for which they were designed or
intended, (c) the value or status of the Trust Property, or (d) the value
or status of the Trustees' title to the Trust Property.
5.04 Changes in Applicable Tax Laws - In the event (a) any Law is
hereafter enacted which imposes a Tax upon the Loan, any of the Loan Docu-
ments, or the transactions evidenced or contemplated by any of the Loan
Documents, or (b) any Law now in force governing the taxation of deeds of
trust, debts secured by deeds of trust, or the manner of collecting any such
Tax shall be changed or modified, in any manner, so as to impose a Tax upon
the Loan, any of the Loan Documents, or the transactions evidenced or
contemplated by any of the Loan Documents, (including, without limitation,
a requirement that revenue stamps be affixed to any or all of the Loan Doc-
uments), the Grantor will promptly pay any such Tax. If the Grantor fails to
make prompt payment, or if any Law either prohibits the Grantor from making
the payment or would penalize the Beneficiary if Grantor makes the payment,
then the failure, prohibition, or penalty, shall entitle the Beneficiary to
exercise all rights hereunder as though an Event of Default had occurred.
5.05 Further Assurances and Continuation Statements - The Grantor
from time to time will execute, acknowledge, deliver and record, at the
Grantor's sole cost and expense, all further instruments, deeds, conveyances,
supplemental deeds of trust, assignments, financing statements, transfers,
and assurances as in the opinion of the Beneficiary's counsel may be
necessary (a) to preserve, continue, and protect the interest of the Trustees
or the Beneficiary in the Trust Property, (b) to perfect the grant to the
Trustees of every part of the Trust Property, (c) to facilitate the execution
of this trust, (d) to secure the rights and remedies of the Trustees and the
Beneficiary under this Deed of Trust and the other Loan Documents, or (e) to
transfer to any new Trustees or purchaser at a sale hereunder the Trust
Property, funds, and powers now or hereafter held in trust hereunder. The
Grantor, at the request of the Beneficiary, shall promptly execute any
continuation statements required by the Uniform Commercial Code to maintain
the lien on any portion of the Trust Property subject to the Uniform
Commercial Code.
5.06 Expenses - The Grantor shall reimburse the Beneficiary and
the Trustees for any sums, including reasonable attorney's fees and expenses,
incurred or expended by them (a) in connection with any action or proceeding
to sustain the lien, security interest, priority, or validity of any Loan
Document, (b) to protect, enforce, interpret, or construe any of their rights
under the Loan Documents, (c) for any title examination or title insurance
policy relating to the title to the Trust Property, or (d) for any other
purpose contemplated by the Loan Documents. The Grantor shall, upon demand,
pay all such sums together with interest thereon at the Note Rate accruing
from the time the expense is paid. All such sums so expended by the Bene-
ficiary and/or the Trustees shall be secured by this Deed of Trust. In any
action or proceeding to foreclose this Deed of Trust or to recover or
collect the Loan, the provisions of law allowing the recovery of costs,
disbursements, and allowances shall be in addition to the rights given by
this Section
5.07 Environmental Requirements - The Grantor hereby covenants
and agrees that, if at any time it is determined that there are materials
(hereinafter, "Environmental Materials") located on the Property which under
any Environmental Requirements require special handling in collection,
storage, treatment, disposal or removal, the Grantor shall, within thirty (30)
days after written notice thereof, take or cause to be taken, at its sole
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expense, such actions as may be necessary to comply with all Environmental
Requirements. If the Grantor shall fail to take such action, the Bene-
ficiary may make advances or payments towards performance or satisfaction of
the same but shall be under no obligation to do so; and all sums so advanced
or paid, including all sums advanced or paid in connection with any judicial
or administrative investigation or proceeding relating thereto, including,
without limitation, reasonable attorneys' fees, fines, or other penalty
payments shall be at once repayable by Grantor and shall bear interest at
the Interest Rate defined in the Note or at the maximum interest rate which
the Grantor may by law pay, which ever is lower, from the date the same
shall become due and payable until the date paid, and all sums so advanced
or paid, with interest as aforesaid shall become a part of the indebtedness
secured hereby. Failure of the Grantor to comply with all Environmental
Requirements shall constitute and be a default under this Deed of Trust.
Grantor shall defend, indemnify and hold harmless the Beneficiary and
Trustees against any loss, cost or expense incurred by the Beneficiary or
Trustees resulting from the presence on the Property at any time of any
Environmental Materials, not properly handled in accordance with environ-
mental requirements.
6. RIGHTS AND DUTIES OF GRANTOR WITH RESPECT TO MANAGEMENT AND USE
OF THE TRUST PROPERTY
6.01 Control by the Grantor - Until the happening of an Event of
Default, the Grantor shall have the right to possess and enjoy the Trust
Property. Including collecting rent as provided in Section ???
6.02 Financial Statements - In addition to the financial state-
ments and records provided for in the Construction Loan Agreement, the
Grantor shall furnish to the Beneficiary annual financial and operating
statements of the Grantor and a cash flow report of the Trust Property.
Such statements shall be certified by the Grantor and shall be prepared in
accordance with generally accepted accounting principles applied on a
consistent basis. All such financial and operating statements shall be
supplied not later than April 30 of each year. The Grantor agrees to make
its books and records relating to the operation of the Trust Property
available for inspection by the Beneficiary, upon request at any reasonable
time, at 211 Talbot Street, St. Michaels, Md. 21663, or at such other
location in the State of Maryland as Beneficiary may reasonably request.
6.03 Alterations and Additional Improvements - The Grantor shall
make no structural alterations or material nonstructural alterations to the
Trust Property or construct any additional improvements on the Land, without
the prior written consent of the Beneficiary, which consent shall not be
unreasonably withheld. All alterations or improvements consented to by
Beneficiary shall be completed and paid for by the Grantor within a
reasonable time. All such alterations or improvements shall be erected (a) in
a good and workmanlike manner strictly in accordance with all applicable Law,
(b) entirely on the Land, (c) without encroaching upon any easement, right of
way, or land of others, (d) so as not to violate any applicable use, height,
set-back or other applicable restriction, and (e) without permitting any
mechanic's lien to attach to the Trust Property which is not being contested
as permitted in Section 6.08. All alterations, additions, and new improve-
ments to the Trust Property shall automatically be a part of the Trust
Property and shall be subject to this Deed of Trust.
6.04 Restrictions on Sale and Transfer of the Trust Property -
Except for the Proposed Sale, the Grantor shall not permit the Trust Property,
or any part or portion thereof of or any interest therein, to be transferred
(whether by voluntary or involuntary conveyance, operation of law, or other-
wise) without the prior written consent of the Beneficiary, which consent
shall not be unreasonably withheld.
6.05 Restriction on Encumbrances - The Grantor shall not allow any
Encumbrances on the Trust Property except the Permitted Encumbrances. The
Grantor shall give the Beneficiary prompt notice of any defaults in or under
any Permitted Encumbrances and any notice of foreclosure or threat of
foreclosure. The Grantor shall comply with its obligations under all
Permitted Encumbrances. The Beneficiary may, at its election, satisfy any
Encumbrance (other than a Permitted Encumbrance not then in default), and
the Grantor shall, on demand, reimburse the Beneficiary for any sums advanced
for such satisfaction together with interest at the Note Rate accruing from
the date of satisfaction, which sums shall be secured hereby.
6.06 Maintenance, Waste, Repair and Inspection - Grantor shall (a)
keep and maintain the Trust Property in good order, condition, and repair and
make all equipment replacements and repairs necessary to insure that the
security for the Loan is not impaired, (b) not commit or suffer any waste of
the Trust Property, (c) promptly protect and conserve any portion of the
Trust Property remaining after any damage to, or partial destruction of, the
Trust Property, (d) promptly repair, restore, replace or rebuild any portion
of the Trust Property which is damaged or destroyed, (e) promptly restore the
balance of the Trust Property remaining after any Taking, (f) permit the
Beneficiary or its designee to inspect the Trust Property at all reasonable
times, and (g) not make any material change in the grade of the Trust
Property or permit any excavation of or on the Trust Property.
6.07 Removal and Replacement of Equipment and Improvements - No
part of the Trust Property shall be removed from the Land, demolished, or
materially altered without the prior written consent of the Beneficiary,
which consent will not be unreasonably withheld.
6.08 Taxes and Permitted Contests - The Grantor shall pay (a) all
Taxes (other than those payable by the Beneficiary from the Expense Account)
on or before the date any interest or penalty begins to accrue or attach
thereto, and (b) all lawful claims which, if unpaid, might become a lien or
charge upon the Trust Property to such an extent as to materially and
adversely affect the Grantor's ability to use the Trust Property for the
purposes for which it was designed or intended. Provided however, that the
Grantor shall not be required to pay any Taxes or claim the amount, validity
or payment of which is being contested, in good faith, by appropriate legal
proceedings, and so long as, in the sole opinion of the Beneficiary, no part
of the Trust Property is in danger of being sold, forfeited or lost and the
contest is not impairing the security for the Loan. Upon payment thereof,
the Grantor shall promptly supply the Beneficiary with receipts showing the
payment of the Taxes or claim.
6.09 Restrictive Covenants, Zoning, etc. - No restrictive
covenant, zoning change, or other restriction affecting the Trust Property
may be entered into requested by or consented to by Grantor without the
prior written consent of the Beneficiary.
6.10 Preservation of Appurtenances - The Grantor will do all
things necessary to preserve intact and unimpaired, all easements, appur-
tenances, and other interests and rights in favor of, or constituting any
portion of, the Trust Property.
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7. INSURANCE AND CONDEMNATION
7.01 Casualty Insurance and Allocation in Event of Loss - The
Grantor shall keep the Trust Property insured for the benefit of the Grantor,
the Trustees and the Beneficiary against all Risks. The limits, form, co-
insurance clauses, and insurer for all such policies shall be satisfactory to
the Beneficiary. Subject to any superior rights of the Beneficiary of the
Permitted Encumbrances, the Grantor shall assign and deliver to the Bene-
ficiary all such policies. The policies shall contain a standard mortgagee
loss payable endorsement providing that all payments shall be made to the
sole order of the Trustees and the Beneficiary to be applied by them in
accordance with the terms of this Deed of Trust. Within thirty (30) days
prior to the expiration of any policy, the Grantor shall supply the Bene-
ficiary with a renewal policy marked "Premium Paid." All proceeds under such
policies shall be paid to the Trustees and the Beneficiary to be applied (a)
if funds sufficient to restore the Trust Property are available from such
insurance proceeds (together with other funds supplied or caused to be
supplied by Grantor) and no Default is then outstanding, to the restoration
of the Trust Property or, (b) if sufficient funds are not available to
restore the Trust Property or a Default is then outstanding, to prepayment
of amounts due under the Note, in inverse order of maturity. All moneys not
utilized for the restoration of the Trust Property shall be applied as a
prepayment of amounts due under the Note. If proceeds of insurance are used
to restore the Trust Property, as aforesaid, neither Trustees nor the
Beneficiary shall be obligated to see to the proper allocation thereof,
nor shall any such amount so used be deemed a payment of any indebtedness
secured by this Deed of Trust. Proceeds of insurance to be used for restora-
tion purposes shall be held by the Beneficiary and disbursed under such
terms and conditions, to such Persons, and at such times, as Beneficiary may
determine.
7.02 Liability Insurance - Unless waived by Trustees and Bene-
ficiary the Grantor will maintain liability and indemnity insurance with
respect to the Trust Property in such amounts, with such companies, and
subject to such terms and conditions as the Beneficiary may direct and
approve. Such policies of insurance shall name the Trustees and the
Beneficiaries as additional insureds thereunder and within thirty (30)
days prior to the expiration of any such policy, the Grantor shall supply
the Beneficiary with a renewal policy marked "Premium Paid".
7.03 Condemnation and Allocation of Condemnation Awards - Grantor,
immediately upon obtaining knowledge of the institution of any proceeding for
a Taking, will notify the Trustees and the Beneficiary of such proceedings.
The Trustees or the Beneficiary may participate in any such proceedings, and
Grantor will, from time to time, deliver to the Trustees or the Beneficiary
all instruments requested by them to permit such participation. Any award or
payment made as a result of any Taking shall be paid to the Trustees and the
Beneficiary, jointly, to be applied (a) if funds sufficient to restore the
remainder of the Trust Property are available from such award or payment
(together with other funds supplied or caused to be supplied by Grantor) and
no Default is then outstanding, to the restoration of the remainder of the
Trust Property, or (b) if sufficient funds are not available to restore the
remainder of Trust Property or a Default is then outstanding, to prepayment
of amounts due under the Note, in inverse order of maturity. All moneys not
utilized for the repair or restoration of the remainder of the Trust
Property shall be applied as a prepayment of amounts due under the Note, in
inverse order of maturity. The application of any award or payment as a
prepayment of amounts due under the Note shall take effect only on the actual
date of the receipt of the payment or award by the Trustees and the Bene-
ficiary. In the event any payment or award is used to restore the Trust
Property, as aforesaid, neither the Trustees nor the Beneficiary shall be
obligated to see to the proper allocation thereof nor shall any amount so
used be deemed a payment of any indebtedness secured by this Deed of Trust.
Payments or awards to be used for restoration purposes, as aforesaid, shall
be held by the Beneficiary and disbursed under such terms and conditions, to
such Persons, and at such times, as Beneficiary may determine.
8. SUBSTITUTION OF TRUSTEES - The Beneficiary may, by filing a deed
of appointment in the office where this instrument is recorded, appoint
additional or replacement trustees and may remove the Trustees, from time
to time, without notice to the Grantor or the Trustees and without
specifying any reason.
9. DEFAULT
9.01 Event of Default - The occurrence of any of the following
shall constitute an Event of Default.
9.01.01 Monetary Defaults - The failure of the Grantor to
pay any amounts due under the Guaranty Agreement when due and payable,
unless such payment is made within ten (10) days from the date such payment
became due and payable; and the failure of the Grantor to pay any amounts
due under any Permitted Encumbrances when due and payable.
9.01.02 Breach of Representations and Warranties - Any
representation or warranty made by the Grantor herein or any statement or
representation made in any of the Loan Documents shall prove to have been
incorrect in any material respect when made or shall be breached.
9.01.03 Insurance Provisions - The failure of Grantor to
perform its obligations set forth in Section 7.01, or 7.02.
9.01.04 Receiver; Bankruptcy - If the Grantor (a) applies
for, or consents in writing to, the appointment of a receiver, trustee, or
liquidator for it of the Trust Property, or of all or substantially all of
its assets, (b) files a voluntary petition in bankruptcy or admits in
writing its inability to pay its debts as they become due, (c) makes an
assignment for the benefit of creditors, (d) files a petition or an answer
seeking a reorganization, composition, adjustment, arrangement with
creditors, or takes advantage of any insolvency law, or (e) files an answer
admitting the material allegations of a petition filed against it in any
bankruptcy, reorganization, composition, adjustment, arrangement, or
insolvency proceeding.
9.01.05 Receiver; Bankruptcy (Involuntary) - If (a) any
execution or attachment levied against the assets of the Grantor is not set
aside, discharged, or staved within sixty (60) days after the same was
levied or within ten (10) days after the expiration of any stay thereof,
(b) an order, judgment, or decree is entered by any court of competent
jurisdiction on the application of a creditor, adjudicating the Grantor a
bankrupt or insolvent, or appointing a receiver, trustee, or liquidator for
the Grantor, or of all or substantially all of its assets, or (c) an order
of relief is entered against the Grantor pursuant to any bankruptcy statute
or law and such order, judgment, or decree continues unstayed and in effect
for a period of sixty (60) days and is not discharged within ten (10) days
after the expiration of any stay thereof.
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9.01.06 Assignment of Rents - Except for Permitted Encum-
brances, any attempted assignment by the Grantor of the whole or any part of
the Rents.
9.01.07 Prohibited Transfer or Encumbrance - Any transfer or
event in violation of the provisions of Sections 6.04, or 6.05.
9.01.08 Loss of License - The loss of any franchise
agreement, license or permit necessary for the operation, occupancy, or use
of the Trust Property, if the same is not restored within thirty (30) days
after the loss.
9.01.09 Judgments - Any judgment in excess of $25,000
against the Grantor remains unpaid, unstayed, undischarged, unbonded or un-
dismissed for a period of thirty (30) days following the date which the
judgment becomes final or any appeal thereof is finally determined.
9.01.10 Other Obligations - Any obligation of the Grantor
(other than the obligations secured hereunder) in excess of $25,000 becomes
or is declared to be due and payable prior to the expressed maturity thereof
and the same is not paid within thirty (30) days of the accelerated maturity
date.
9.01.11 Other Defaults - The failure of the Grantor to
perform or observe any of its obligations or covenants under this Deed of
Trust not previously specifically referred to in this Article 9.00, which
failure continues for a period of thirty (30) days after written notice to
Grantor unless, within such thirty (30) day period, Grantor shall have
commenced best efforts to cure such default, and after such commencement,
shall proceed diligently to cure such default.
9.01.12 Default Under Other Loan Documents - The failure of
the Grantor to perform or observe any of its obligations or covenants in any
Loan Document other than this Deed of Trust, which failure is not remedied
within any applicable grace period specified in such other Loan Document.
9.01.13 Event of Default under Other Loan Documents - An
"Event of Default" (if so defined) or, if not so defined, a material default
occurs under a Loan Document other than this Deed of Trust.
9.02 Payment or Performance by Trustees or Beneficiary - Upon
Default, the Trustees or the Beneficiary may, at their option, make any
payments or take any other actions they deem necessary or desirable to cure
the Default or conserve the Trust Property. The Grantor shall, upon demand,
reimburse the Trustees or the Beneficiary for all sums so advanced or
reasonable expenses incurred by them, together with interest at the Note
Rate from the date of advance or payment of the same, which sums shall be
secured by this Deed of Trust. The Trustees or the Beneficiary may enter
upon the Trust Property without prior notice to the Grantor or judicial
process and may take any action to enforce its rights under this Section
9.02 without liability to the Grantor, except for damages resulting from the
Grantor's or the Trustees' negligence.
9.03 Possession by Trustees or Beneficiary - Upon the occurrence
of an Event of Default, the Trustees or the Beneficiary may enter upon and
take possession of the Trust Property without notice to the Grantor,
judicial process, or the appointment of a receiver. The Trustees or the
Beneficiary may exclude all persons from the Trust Property and may proceed
to operate the Trust Property and receive all Rents. Neither the Trustees
nor the Beneficiary shall be liable to the Grantor for taking possession of
the Trust Property, as aforesaid, nor shall they be required to make repairs
or replacements, and they shall be liable to account only for Rents actually
received by them. All Rents collected by the Trustees or the Beneficiary shall
be applied (a) first, to pay all expenses incurred in taking possession of the
Trust Property, (b) second, to pay costs and expenses to operate the Trust
Property, and/or to comply with the terms of the Loan Documents, including
reasonable attorney's fees, (c) third, to pay all sums secured by the Loan
Documents in the order of priority selected by Beneficiary, and (d) fourth,
with the balance, if any, to the Grantor or such other Person as may be
entitled thereto. No assignment of Leases shall impose upon Trustees or
Beneficiary any liability to perform Grantor's obligations under such Leases.
9.04 Acceleration of the Note - Upon an Event of Default, Bene-
ficiary may, at its option and by written notice to the Grantor, declare the
entire balance of the Note and all other amounts due under the Loan Documents,
immediately due and payable. Acceleration of maturity, once claimed by the
Beneficiary, may at the option of the Beneficiary, be rescinded by written
acknowledgment to that effect by the Beneficiary, but the tender and
acceptance of partial payments alone shall not in any way affect or rescind
such acceleration of maturity.
9.05 Collection of Rents - Upon the occurrence of an Event of
Default and written demand by the Beneficiary to the Tenants, all rents shall
be payable directly to the Beneficiary.
9.06 Power of Sale and Assent to a Decree - The Grantor assents
to the passage of a decree for the sale of the Trust Property upon the
occurrence of an Event of Default, by any court having jurisdiction and the
Grantor authorizes and empowers the Trustees, upon the occurrence of an Event
of Default, to sell the Grantor's interest in the Trust Property, in accord-
ance with the Maryland Rules of Procedure or any other Law. The Trust
Property or any interest therein may be sold upon such terms and in as many
parcels as the person conducting the sale may, in his sole discretion, elect.
No re-advertisement of any sale shall be required if the sale is adjourned by
announcement, at the time and place set therefor, of the date, time, and
place to which the same is to be adjourned.
9.07 Application and Proceeds of Sale - Upon a foreclosure sale,
the purchaser shall receive that portion of or interest in the Trust Property
purchased by it free from any claims of the Grantor and without any liability
to see to the application of the purchase money. The net proceeds from the
sale, after deduction of all costs of the sale, shall be applied (a) first,
to pay all expenses incurred in taking possession of the Trust Property, (b)
second, to pay the costs and expenses to Operate the Trust Property,
including reasonable attorney's fees, (c) third, to pay all sums secured by
or due under the Loan Documents in the order of priority determined by the
Beneficiary, and (d) fourth, the balance, if any, to the Grantor or to other
Persons entitled thereto.
9.08 Deficiency of Proceeds - If, after a foreclosure sale, a
deficiency exists in the net proceeds of such sale, the Beneficiary shall
be entitled to a deficiency judgment or decree for such deficiency which
shall bear interest at the Note Rate.
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9.09 Trustee's Commission - Upon a foreclosure sale of any portion
of or interest in the Trust Property, the Trustees shall be entitled to a
commission equal to One Hundred Fifty Dollars ($150.00) plus five percent
(5%) of the principal amount then secured by this Deed of Trust. In the
event any portion of the Trust Property is advertised for foreclosure sale
and not sold, the Trustees shall be entitled to a commission equal to one-
half (1/2) of the commission provided in case of foreclosure sale, to be
computed on the amount of the Loan then outstanding. The person making the
sale shall not be required to accept payment of the amounts secured hereby
unless accompanied by all expenses of the proceedings and one-half (1/2) of
the commissions.
9.10 Insurance or Condemnation After Deficiency - If the Trust
Property is sold at a foreclosure sale prior to receipt of an insurance or
a condemnation award or payment, the Beneficiary shall receive and apply
the proceeds of the award or payment toward the satisfaction of any
deficiency resulting from the foreclosure sale, whether or not a de-
ficiency judgment is sought, recovered, or denied.
9.11 Appointment of a Receiver - Upon the occurrence of an Event
of Default, the Beneficiary shall be entitled to the immediate appointment
of a receiver for the Trust Property, without regard to the value of the
Trust Property or the solvency of any person liable for payment of the
amounts due under the Loan Documents.
9.12 Remedies Cumulative - All rights, powers, and remedies of the
Beneficiary or the Trustees provided for in the Loan Documents are cumulative
and concurrent and shall be in addition to and not exclusive of any appropri-
ate legal or equitable remedy provided by Law or contract. Exercise of any
right, power, or remedy shall not preclude the simultaneous or subsequent
exercise of any other by the Beneficiary or the Trustees.
10. MISCELLANEOUS
10.01 Waivers - No term of any Loan Document shall be deemed
waived unless the waiver shall be in writing and signed by the parties
making the waiver. Any failure by the Beneficiary or the Trustees to insist
upon the Grantor's strict performance of any of the terms of the Loan
Documents shall not be deemed or construed as a waiver of those or any
other terms. Any delay in exercising or enforcing any rights with respect
to a Default or an Event or Default shall not bar the Beneficiary or the
Trustees from exercising any rights under the Loan Documents, or at law or
in equity.
10.02 Consents -
10.02.01 The Beneficiary may (a) release any person liable under the
Loan Documents, (b) release any part of the security, (c) extend the time
of payment of the Loan, and/or (d) modify the terms of the Loan Documents,
regardless of consideration and without notice to or consent by the holder
of any subordinate lien on the Trust Property. No release, extension or
modification of the security held under the Loan Documents shall impair or
affect the lien of this Deed of Trust or the priority of such lien over any
subordinate lien.
10.02.02 Regardless of whether a Person has been given notice or has
given its prior consent, it shall not be relieved of any obligation under
any Loan Documents by reason of (a) the failure of the Beneficiary, the
Trustees, or any other Person to take any action, foreclose, or otherwise
enforce any provision of the Loan Documents, or (b) the release of any
portion of the security under the Loan Documents.
10.03 Headings - All Article and Section headings are for con-
venience only and shall not be interpreted to enlarge or restrict the
provisions of this Deed of Trust.
10.04 Notices - All notices shall be in writing and, unless
otherwise specified in a written notice, shall be sent to the respective
addresses of the parties as follows:
Beneficiary: P.O. Box 70 Grantor: 27 Miller Street
St. Michaels, Md. 21663 Suite 2
Lemoyne, PA 17043
Trustees: P.O. Box 70
St. Michaels, Md. 21663
A notice may be hand delivered or mailed, postage prepaid, first class,
registered or certified mail or, where the facsimile transmission telephone
number of the recipient is known, by facsimile transmission by a means which
verifies the date and telephone number of the recipient. A notice that is
sent by facsimile transmission will be deemed given by noon of the first
regular business day following the date of transmission.. Any notice sent
by mail shall be deemed to have been received on the second business day
following the date of mailing.
10.05 Amendment - No Loan Document may be modified except in
writing signed by (a) the Beneficiary and/or the Trustees, and (b) the
Grantor.
10.06 Severability - In the event any provision of this Deed of
Trust shall be held invalid or unenforceable by any court of competent
jurisdiction, such holding shall not invalidate or render unenforceable any
other provision hereof.
10.07 Notices from Governmental Authorities Affecting The Trust
Property - Any notice from any governmental or quasi-governmental authority
or corporation with respect to the Trust Property sent to or known by the
Grantor shall be promptly transmitted to the Beneficiary and the Trustees.
10.08 Applicable Law - All Loan Documents shall be governed by
the Laws of the State of Maryland, without regard to the principles of
conflict of laws.
10.09 Time of the Essence - Time is of the essence with respect
to the Loan Documents.
10.10 Word Forms - The use of any gender, tense, or conjugation
herein shall be applicable to all genders, tenses and conjugations. The use
of the singular shall include the plural and the plural shall include the
singular.
WITNESS the execution hereof by the Grantor and the affixing of the Grantor's
seal.
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Attest Dialysis Corporation of America
/s/ Michele L. Stinchcomb /s/ Bart Pelstring
- -------------------------------- By:-----------------------------(SEAL)
Barton L. Pelstring, President
STATE OF Maryland County of Talbot, to wit:
I HEREBY CERTIFY, that on this 3rd day of December, 1999, before me,
the subscriber, a Notary Public of the State of Maryland in and for the
County aforesaid, personally appeared Barton L. Pelstring, who acknowledged
himself to be the President of Dialysis Corporation of America, and that he
as such President, being authorized so to do, executed the foregoing instru-
ment for the purposes therein contained, by signing the name of the corpora-
tion by himself as such President, and did further certify that this con-
veyance is not part of a transaction in which there is a sale, lease exchange
or other transfer of all or substantially all of the property and assets of
the Grantor. At the same time also appeared John F. Hall, agent of the party
secured by the foregoing Deed of Trust, and made oath in due form of law that
the consideration set forth in the foregoing Deed of Trust is true and bona
fide as therein set forth.
IN WITNESS WHEREOF, my hand and notarial Seal.
/s/ Michele L. Stinchcomb
--------------------------------(SEAL)
Notary Public
My Commission Expires:
12-29-01
- ----------------------
This instrument has been prepared by John F. Hall, an attorney, under
such attorney's supervision, or by one of the parties named in this instru-
ment.
/s/ John F. Hall
-------------------------------------
John F. Hall
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<PAGE>
EXHIBIT A
ALL those two adjoining lots or parcels of land situate on the east side
of Marvel Court in the Town of Easton, Talbot County, Maryland, which are
shown and designated as Lot 6-A and Lot 6-B on a plat made by McCrone, Inc.,
entitled "PLAT SHOWING DIVISION OF THE LAND OF JAMES P. THOMPSON IN THE TOWN
OF EASTON, TALBOT COUNTY, MARYLAND," dated February 19, 1986, and recorded
among the Land Records of Talbot County, Maryland, in Liber No. 69, folio 32.
SUBJECT, HOWEVER, to the terms of a Declaration of Restrictions dated
March 24, 1983, and recorded among the Land Records of Talbot County,
Maryland, at Liber 572, folio 451.
FURTHER SUBJECT TO the restrictions set forth in a deed dated November
10, 1983 from Idlewild Associates, to Idlewild East Joint Venture, recorded
among the Land Records of Talbot County, Maryland, at Liber 580, folio 501.
FURTHER SUBJECT TO the terms of a Declaration of Restrictions, Covenants
and Conditions dated December 12, 1983, and recorded among the Land Records
of Talbot County, Maryland, at Liber 581, folio 674.
Being the same property conveyed to Dialysis Corporation of America, by
virtue of a deed by Crackerjacks, Inc., dated July 27, 1987, and recorded
among the Land Records of Talbot County, Maryland, at Liber MAS No. 637,
folio 564, on August 3, 1987.
ST. MICHAELS BANK
213 Talbot Street, P.O. Box 70, St. MICHAELS, MD 21663
Guaranty Agreement
The undersigned hereby requests ST. MICHAELS BANK (herein called the
"Bank") to give and continue to give DCA of Vineland, LLC (herein called
the "Borrower") credit, as the Borrower may desire and the Bank may grant,
from time to time, whether to the Borrower alone or to the Borrower and
others, and in consideration of any such credit, the Undersigned hereby
absolutely and unconditionally guarantees prompt payment (not merely collec-
tion) when due and at all times thereafter of any and all existing and
future indebtedness and liability of any kind, nature, and character (in-
cluding but not limited to all renewals, extensions, modifications, and all
reasonable attorneys' fees, legal or other expenses of collection) from the
Borrower alone or from the Borrower and others to the Bank, howsoever and
whensoever created, or arising, or evidenced, or acquired (collectively,
the "Guaranteed Obligations"); and the Undersigned waives notice of the
acceptance of this Individual Guaranty (this "Guaranty") and of any and all
such Guaranteed Obligations. The Undersigned hereby waives presentment,
protest, notice, demand or action on delinquency in respect to any such
Guaranteed Obligations, including any right to require the Bank to sue or
otherwise enforce payment thereof.
This Guaranty is made and shall continue as to any and all such
Guaranteed Obligations incurred or arising prior to acknowledgment by the
Bank of receipt by the Bank of written notice of the termination hereof from
the Undersigned, without regard to collateral, or security, or guaranties,
or other obligors, if any, or to the validity or effectiveness of any and all
thereof; and any and all such collateral and security and guarantees and
other obligors, if any, may, from time to time, without notice to or consent
of the Undersigned, be sold, released, surrendered, exchanged, settled,
compromised, waived, subordinated or modified with or without consideration,
without in any manner affecting or impairing the liability of the Under-
signed. It is agreed that the Undersigned's liability hereunder is several
and joint and is independent of any collateral or other guaranties at any
time in effect with respect to all or any part of the Guaranteed Obligations,
and that the Undersigned's liability hereunder may be enforced without regard
to the existence or enforcement or enforceability of claims against the
Borrower, any collateral or guarantor. The Undersigned authorizes any
attorney designated by the Bank to confess judgment in any Court of Record or
in the alternative authorizes the Bank to instruct the clerk of any Court of
Record to confess judgment against the Undersigned at any time after any
Guarantied Obligation is due by its terms or upon default, for the unpaid
amount thereof, together with court costs, reasonable attorneys' fees for
enforcement of the Guaranty, and all other amounts payable to the Bank
pursuant hereto, provided, however, that any lien arising from such confes-
sion of judgment shall not, without further proceedings, apply or attach to
any real property of any natural guarantor which (a) is used or is expected
to be used as his or her principal residence if this is a guaranty by a
natural person primarily for personal, family, household or agricultural
purposes or which (b) is described in section 12-401 (i) of the Maryland
Secondary Mortgage Loan Law as the same may be amended from time to time,
unless this is a guaranty by a corporation or business or commercial
organization or a guaranty in excess of $75,000.00 solely to acquire or
carry on a business or commercial enterprise or to any business or
commercial organization.
The Undersigned represents and warrants to the Bank that (a) this
Guaranty is a legal, valid and binding obligation of the Undersigned,
enforceable in accordance with its terms; (b) there are no actions, suits
or proceedings pending or, to the knowledge of the Undersigned , threatened
against or affecting the Undersigned which would prevent the Undersigned
from executing this Guaranty and performing his or her obligations hereunder;
(c) except for Permitted Encumbrances as defined in the Deed of Trust, the
undersigned's performance under this Guaranty shall not violate any material
contract or material instrument to which the Undersigned is a party or by
which the Undersigned is bound; (d) since the date of any financial statements
of the Undersigned provided to the Bank, except as specifically disclosed to
the Bank in writing, there have been no material adverse changes in the
condition, financial or otherwise, of the Undersigned; and (e) the Undersigned
has a financial interest in the Borrower and the assumption of the Under-
signed's obligations and liabilities hereunder will result in direct
financial benefits to the Undersigned.
Upon the occurrence of any default under any document evidencing any of
the Guaranteed Obligations, the Bank, in its sole discretion, may proceed
first and directly against the Undersigned under the Guaranty without pro-
ceeding against or exhausting any collateral or any other security held by
any other person in connection with the Guaranteed Obligations, and without
first filing suit or proceeding to obtain or assert a claim for personal
judgment against the Borrower or any other guarantor of the Guaranteed Obli-
gations, foreclosing on or disposing of any security therefor, or making any
effort at collection of the Guaranteed Obligations from the Borrower, any
other guarantor thereof or any other person.
Subject to the Permitted Encumbrances as defined in the Deed of trust,
as security for the payment of the Guaranteed Obligations, the Bank is
hereby granted a lien and security interest in all property of the Under-
signed held now or hereafter by the Bank in any capacity and upon the
occurrence of a default hereunder the Bank shall have the right, immediately
and without further action by it, to set-off against any of the Guaranteed
Obligations, all such property, and the Bank shall be deemed to have
exercised such right of set-off and to have made a charge against such
property immediately upon the occurrence of such default even though such
charge is made or entered subsequently on the books of the Bank.
Any debt of Borrower to the Undersigned, now or hereafter existing,
except for Prior Advanced Funds as defined in the Loan Agreement, is and
shall be subordinated to the Guaranteed Obligations. The Undersigned agrees
not to assert any right, directly or by subrogation, against the Borrower or
any assets securing payment of the Guaranteed Obligations, so long as this
Guaranty is outstanding.
Notice hereunder must be sent by registered or certified mail to the
Bank at the address above.
This Guaranty shall also bind the heirs, personal representatives,
successors and assigns of the Undersigned and shall inure to the Bank, its
successors and assigns and shall be governed by the laws of the State of
Maryland.
The Undersigned and the Bank agree to submit any cause involving both
of them arising from the Guaranty to the court for determination without the
aid of a jury.
IN WITNESS WHEREOF, the Undersigned has executed this Guaranty under
seal this 3rd day of December, 1999, specifically intending it to be a
sealed instrument.
WITNESS: Dialysis Corporation of America
/s/ John F. Hall /s/ Bart Pelstring
- -------------------------------- By:-----------------------------(SEAL)
Barton L. Pelstring, President
