UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K/A
Amendment No. 1
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities and Exchange Act 1934
Date of Report: August 20, 1996
INTEGRAMED AMERICA, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Delaware
- --------------------------------------------------------------------------------
(State of other jurisdiction of incorporation)
0-20260 and 1-11440 06-1150326
- --------------------------------------------------------------------------------
(Commission File Numbers) (IRS Employer Identification No.)
One Manhattanville Road, Purchase, NY 10577
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone no. including area code: (914) 253-8000
Registrant's former name: IVF America, Inc.
<PAGE>
INTEGRAMED AMERICA, INC.
FORM 8-K/A
TABLE OF CONTENTS
PAGE
FINANCIAL INFORMATION
Financial Statements
Report of Independent Accountants.............................. 3
Combined Balance Sheet as of June 6, 1996 (unaudited) and
December 31, 1995 (audited).................................. 4
Combined Statement of Operations for the period from
January 1, 1996 through June 6, 1996 (unaudited) and for
the year ended December 31, 1995 (audited)................... 5
Combined Statement of Shareholder's Equity for the period
from January 1, 1996 through June 6, 1996 (unaudited)
and for the year ended December 31, 1995 (audited).......... 6
Combined Statement of Cash Flows for the period from
January 1, 1996 through June 6, 1996 (unaudited)and for
the year ended December 31, 1995............................ 7
Notes to Combined Financial Statements......................... 8-12
Pro Forma Consolidated Financial Information (unaudited)
Basis of Presentation......................................... 13
Pro Forma Consolidated Statement of Operations for the
six-month period ended June 30, 1996........................ 14
Pro Forma Consolidated Statement of Operations for the
year ended December 31, 1995................................ 15
SIGNATURES .......................................................... 16
INDEX TO EXHIBITS.................................................... 17
2
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors and Shareholder of
Women's Medical and Diagnostic Center
In our opinion, the accompanying combined balance sheet and related
statements of operations, of shareholder's equity and of cash flows present
fairly, in all material respects, the financial position of the Women's Medical
and Diagnostic Center and affiliated companies at December 31, 1995, and the
results of their operations and their cash flows for the year then ended in
conformity with generally accepted accounting principles. These financial
statements are the responsibility of the company's management; our
responsibility is to express an opinion on these financial statements based on
our audit. We conducted our audit of these statements in accordance with
generally accepted auditing standards which require that we plan and perform the
audit to obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements,
assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for the opinion expressed
above.
As discussed in Note 2 to the combined financial statements, the company
was acquired by IntegraMed America, Inc. on June 7, 1996.
Price Waterhouse LLP
Stamford, Connecticut
August 8, 1996
3
<PAGE>
<TABLE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
COMBINED BALANCE SHEET
ASSETS
<CAPTION>
June 6, December 31,
1996 1995
---- ----
(unaudited) (audited)
<S> <C> <C>
Current assets:
Cash and cash equivalents .................................................... $ 29,000 $ 42,000
Research accounts receivable, net............................................. 242,000 346,000
Patient accounts receivable, less allowance for doubtful accounts of $10,000
in both 1996 and 1995........................................................ 116,000 103,000
Other current assets ......................................................... 5,000 19,000
------- -------
Total current assets........................................................ 392,000 510,000
------- -------
Fixed assets, net ............................................................ 99,000 117,000
------- -------
Total assets............................................................... $ 491,000 $627,000
========= ========
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
Litigation reserve............................................................ $ 50,000 $ 50,000
Accrued payroll............................................................... 12,000 14,000
Other accrued liabilities..................................................... 5,000 15,000
Current portion of long-term debt............................................. 44,000 52,000
Deferred revenues............................................................. 76,000 84,000
Patient deposits ............................................................. 2,000 1,000
Total current liabilities.................................................. 189,000 216,000
------- -------
Long-term debt ................................................................. 63,000 75,000
Commitments and contingencies- (see Note 6).................................... - -
Shareholder's equity -
Common Stock, $1.00 par value, 300 shares authorized, issued and
outstanding at June 6, 1996 and December 31, 1995, respectively........... - -
Accumulated earnings.......................................................... 239,000 336,000
Total shareholder's equity ................................................ 239,000 336,000
------- -------
Total liabilities and shareholder's equity................................. $ 491,000 $627,000
========= ========
See accompanying notes to the combined financial statements.
</TABLE>
4
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
COMBINED STATEMENT OF OPERATIONS
For the period from For the
January 1, 1996 year ended
through June 6, December 31,
1996 1995
------------------- ----------
Revenues, net (see Note 2)............ $ 572,000 $1,948,000
Costs of services rendered ........... 751,000 1,670,000
------- ---------
Contribution ......................... (179,000) 278,000
General and administrative expenses .. 55,000 210,000
Interest income....................... - (2,000)
Interest expense...................... 5,000 13,000
------- ---------
Total other expenses.................. 60,000 221,000
------- ---------
Net (loss) income..................... $(239,000) $ 57,000
========= ==========
See accompanying notes to the combined financial statements.
5
<PAGE>
<TABLE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
COMBINED STATEMENT OF SHAREHOLDER'S EQUITY
<CAPTION>
Total
Common Stock Accumulated Shareholder's
Shares Amount Earnings Equity
------ ------ -------- ------
<S> <C> <C> <C> <C>
Balance as of January 1, 1995.................. 300 - $438,000 $438,000
Net income..................................... - - 57,000 57,000
Contributions by shareholder................... - - 150,000 150,000
Distributions to shareholder................... - - (309,000) (309,000)
-------- --------
Balance as of December 31, 1995................ 300 - 336,000 336,000
Net loss....................................... - - (239,000) (239,000)
Contributions by shareholder.... ............. - - 165,000 165,000
Distributions to shareholder................... - - (23,000) (23,000)
-------- --------
Balance as of June 6, 1996..................... 300 - $239,000 $239,000
=== ===== ======== ========
See accompanying notes to the combined financial statements.
</TABLE>
6
<PAGE>
<TABLE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
COMBINED STATEMENT OF CASH FLOWS
<CAPTION>
For the Period For the
from January 1, 1996 Year ended
through June 6, December 31,
1996 1995
------------------- ------------
(unaudited) (audited)
<S> <C> <C>
Cash flows from operating activities:
Net (loss) income.......................................................... $(239,000) $ 57,000
Adjustments to reconcile net (loss) income to net cash (used in)
cash (used in) provided by operating activities:
Depreciation and amortization............................................ 20,000 41,000
Changes in assets and liabilities--
(Increase) decrease in assets:
Research accounts receivable........................................... 104,000 (138,000)
Patient accounts receivable............................................ (13,000) 71,000
Other current assets................................................... 14,000 (11,000)
Increase (decrease) in liabilities:
Litigation reserve....................................................... - 50,000
Accrued payroll.......................................................... (2,000) 14,000
Other accrued liabilities................................................ (10,000) 8,000
Deferred revenue......................................................... (8,000) 41,000
Patient deposits......................................................... 1,000 (1,000)
-------- --------
Net cash (used in) provided by operating activities........................ (133,000) 132,000
-------- --------
Cash flows used in investing activities:
Purchase of fixed assets and leasehold improvements...................... (2,000) (48,000)
-------- --------
Net cash used in investing activities...................................... (2,000) (48,000)
-------- --------
Cash flows (used in) provided by financing activities:
Proceeds from issuance of debt........................................... - 14,000
Principal repayments on debt............................................. (20,000) (31,000)
Contributions by shareholder............................................. 165,000 150,000
Distributions to shareholder............................................. (23,000) (309,000)
-------- --------
Net cash provided by (used in) financing activities.......................... 122,000 (176,000)
-------- --------
Net decrease in cash......................................................... (13,000) (92,000)
Cash at beginning of period.................................................. 42,000 134,000
-------- --------
Cash at end of period........................................................ $ 29,000 $ 42,000
======== ========
</TABLE>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION AND NON-CASH
TRANSACTIONS:
Interest paid in cash for the period from January 1, 1996 through June 6,
1996 and for the year ended December 31, 1995 amounted to approximately $5,000
and $13,000, respectively. Interest received for the period from January 1, 1996
through June 6, 1996 and for the year ended December 31, 1995 amounted to
approximately $400 and $2,000, respectively.
See accompanying notes to the combined financial statements.
7
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
NOTES TO COMBINED FINANCIAL STATEMENTS
NOTE 1 - THE COMPANY:
Women's Medical and Diagnostic Center (the "Company"), located in
Gainesville, Florida, provides comprehensive health care to peri and
post-menopausal women. The Company has a multidisciplinary approach and offers a
full service clinical ambulatory care facility that provides comprehensive
diagnostic and treatment alternatives to peri- and post-menopausal women and
clinical research pursuant to contracts with pharmaceutical companies related to
the treatment of health issues common to peri- and post menopausal women.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of combination -
The accompanying combined financial statements of the Company comprise
the accounts of the Climacteric Clinic, Inc. (CCI), the Women's Research
Centers, Inc. (WRC), and the Midlife Centers of America, Inc. (MCA), all related
companies in Gainesville, Florida, which prior to June 7, 1996 had been owned by
Dr. Morris Notelovitz, the then sole shareholder of these companies. Effective
June 7, 1996, all of the outstanding common stock of CCI, WRC and MCA was
acquired by INMD Acquisition Corp. (IAC) which changed its name to the Women's
Medical & Diagnostic Center, Inc. ("WMDC"). WMDC is a wholly owned subsidiary of
IntegraMed America, Inc., a public company based in Purchase, New York, which
provides comprehensive management, laboratory and clinical support services to
medical specialty providers of reproductive and women's health care services.
Interim results -
In the opinion of management, the accompanying unaudited interim
financial statements contain all adjustments (consisting only of normal
recurring accruals) necessary to present fairly the financial position at June
6, 1996, and the results of operations and cash flows for the interim period
presented. Operating results for the interim period are not necessarily
indicative of results that may be expected for the year ending December 31,
1996.
Revenue and cost recognition -
Revenues consist of service revenues for patients and research contracts.
Patient revenues are recorded on a net realizable basis after deducting
contractual allowances and consist of patient fees collected by the Company for
peri and post menopausal women's healthcare services performed by the Company.
Patient revenues and related direct costs are recognized in the period in which
the clinical and/or laboratory services are rendered. Net realization is
dependent upon benefits provided by the patient's insurance policy or agreements
between the Company and the third-party payor. Payments collected from patients
in advance for services are included in patient deposits.
Research revenues are earned under research study contracts between the
Company and various pharmaceutical companies. The Company contracts with major
pharmaceutical companies (sponsors) to perform women's medical care research
mainly to determine the safety and efficacy of a medication. Based on the data
collected from studies conducted by the Company and other non-related centers
8
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
NOTES TO COMBINED FINANCIAL STATEMENTS (continued)
for major pharmaceutical companies, the Food and Drug Administration (FDA)
determines whether a medication can be manufactured and made available to the
public. Research revenues are recorded on a net realizable basis after deducting
contractual allowances and consist of fees from pharmaceutical companies for
medical services performed by the Company as stipulated by the research study
protocol. Research revenues are recognized in the period in which the clinical
and/or laboratory services are rendered and collection of such fees is
considered probable. Net realization is dependant upon final approval by the
sponsor that procedures were performed according to study protocol. Payments
collected from sponsors in advance for services are included in deferred
revenues. Costs incurred in performing the research studies are included in
"Cost of services rendered". For the period from January 1, 1996 through June 6,
1996 and for the year ended December 31, 1995 one and two pharmaceutical
companies, respectively, each comprised greater than 10% of the Company's total
research revenues.
Cash and cash equivalents -
The Company considers all highly liquid debt instruments with original
maturities of three months or less to be cash equivalents.
Patient accounts receivable -
Patient accounts receivable represent receivables from patients for
medical services provided by the Company. Such amounts are recorded net of
contractual allowances and estimated bad debts.
Research fees receivable -
Research fees receivable represent receivables from pharmaceutical
companies for medical services provided by the Company to patients pursuant to
protocols stipulated under research study contracts between the pharmaceutical
companies and the Company.
Fixed assets -
Fixed assets are valued at cost less accumulated depreciation and
amortization. Depreciation is computed on a straight-line basis over the
estimated useful lives of the related assets, generally three to five years.
Leasehold improvements are amortized over the shorter of the asset life or the
remaining term of the lease.
When assets are retired or otherwise disposed of, the costs and
related accumulated depreciation are removed from the accounts. The difference
between the net book value of the assets and proceeds from disposition is
recognized as gain or loss. Routine maintenance and repairs are charged to
expenses as incurred, while costs of betterments and renewals are capitalized.
Income taxes -
The Company, a Florida corporation, has elected under Internal Revenue
Code Section 1362 (a) to be taxed as an "S" corporation for Federal income tax
purposes whereby income is taxed directly to its shareholder. The state of
Florida does not have a corporate income tax. As a result, no provision for
taxes has been reflected in the combined statement of operations.
9
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
NOTES TO COMBINED FINANCIAL STATEMENTS (continued)
Use of estimates in the preparation of the combined financial statements -
The preparation of these combined financial statements in conformity
with generally accepted accounting principles requires management of the Company
to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosures of contingent assets and liabilities, at the date of
the financial statements, and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
NOTE 3 - FIXED ASSETS, NET:
Fixed assets, net at June 6, 1996 and December 31, 1995 consisted of the
following:
June 6, 1996 December 31, 1995
(unaudited) (audited)
Furniture, office and other equipment.. $124,000 $122,000
Medical equipment...................... 182,000 182,000
Leasehold improvements................. 47,000 47,000
--------- ---------
Total ........................... 353,000 351,000
Less - Accumulated depreciation and
amortization......................... (254,000) (234,000)
-------- --------
$ 99,000 $117,000
======== ========
Depreciation and amortization expense totaled $18,000 and $2,000,
respectively, for the period from January 1, 1996 through June 6, 1996 and
$37,000 and $4,000, respectively, for the year ended December 31, 1995.
NOTE 4 - DEBT:
Debt at June 6, 1996 and December 31, 1995 consisted of the following:
June 6, December 31,
1996 1995
---- ----
(unaudited) (audited)
Unsecured line of credit.......................... $12,000 $ 20,000
Secured note, due in installments through 1998.... 47,000 55,000
Secured note, due in installments through 1999.... 48,000 52,000
------ --------
Total debt..................................... 107,000 127,000
Less - current portion........................ (44,000) (52,000)
--------- --------
Long-term debt................................. $63,000 $ 75,000
========= ========
In June 1995, the Company renewed a $30,000 unsecured line of credit of
which $12,000 and $20,000 was outstanding at June 6, 1996 and December 31, 1995,
respectively. Interest is payable quarterly at the bank's prime rate plus 1.5%
which equaled 9.75% at June 6, 1996 and 10% at December 31, 1995. Total
commitment fees for the period from January 1, 1996 through June 6, 1996 and for
the year ended December 31, 1995 were immaterial.
10
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
NOTES TO COMBINED FINANCIAL STATEMENTS (continued)
In September 1993, the Company obtained a promissory note in the amount
of $100,000 primarily for leasehold improvements of which $47,000 and $55,000
was outstanding at June 6, 1996 and December 31, 1995, respectively. The note is
payable in 59 monthly installments of $1,667 plus interest, commencing on
October 8, 1993 through September 8, 1998. Simple interest is payable annually
at the bank's prime rate plus 1% which equaled 9.25% and 9.5% at June 6, 1996
and December 31, 1995, respectively. The note is secured by all tangible fixed
assets of the Company.
In November 1994, the Company obtained a promissory note in the amount of
$64,000 primarily for medical equipment of which $48,000 and $52,000 was
outstanding at June 6, 1996 and December 31, 1995, respectively. The note is
payable in 59 monthly installments of $1,330.00 including interest, commencing
on December 18, 1994 through December 18, 1999. Simple interest is payable
annually at a fixed rate of 9%. The note is secured by the underlying medical
equipment.
NOTE 5 - OPERATING LEASES
In October 1993, the Company entered into a three-year lease of its
corporate and medical offices. During 1996, the Company amended the lease,
whereby the term was extended to August 31, 1999. Rental expense under this
operating lease was $46,000 and $108,000 for the period from January 1, 1996
through June 6, 1996 and for the year ended December 31, 1995, respectively.
At December 31, 1995, the minimum lease payments for noncancelable
operating leases in future years pursuant to the amended lease were as follows:
1996 ................................... $111,000
1997 ................................... 114,000
1998 ................................... 114,000
1999 ................................... 76,000
--------
Total minimum operating lease payments...... $415,000
--------
NOTE 6 - COMMITMENTS AND CONTINGENCIES:
Litigation -
On May 1, 1996, a claim of age discrimination was filed in the United
States District Court, Northern District of Florida, Gainesville Division, by a
former employee of the Company. The litigation arises out of a claim originally
filed with the Florida Commission on Human Relations on October 24, 1995. The
litigation is currently in the initial pleading and discovery stage, however, on
July 15, 1996, a settlement proposal was submitted to the Company . The Company
believes to have one or more valid defenses and intends to rigorously defend the
action. Management believes it has adequately provided for any such payment
should an unfavorable determination be made.
There are other legal proceedings to which the Company is a party. In the
Company's view, the claims asserted and the outcome of these proceedings will
not have a material adverse effect on the financial position or the results of
operations of the Company.
11
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
NOTES TO COMBINED FINANCIAL STATEMENTS (continued)
NOTE 7 - RELATED PARTY TRANSACTIONS:
During 1995, Dr. Morris Notelovitz, the sole shareholder of the Company,
and his wife were paid salaries of $166,000 and $37,000, respectively.
During 1995, the Company provided management services to another Company
owned by Dr. Morris Notelovitz in an amount of $16,500 of which $11,000 was
outstanding as a receivable at December 31, 1995.
NOTE 8 - SUBSEQUENT EVENT:
On June 7, 1996, IntegraMed America, Inc. ("INMD") entered into an
Agreement and Plan of Merger (the "Agreement") pursuant to which INMD
Acquisition Corp. ("IAC"), a Florida corporation and wholly-owned subsidiary of
INMD, acquired all of the outstanding stock of the following three related
Florida corporations: The Climacteric Clinic, Inc. ("CCI"), Midlife Centers of
America, Inc. ("MCA"), and Women's Research Centers, Inc. ("WRC"), America
(collectively "the Company"), and 51% of the outstanding stock of the National
Menopause Foundation, Inc. ("NMF"), also a related Florida corporation. Pursuant
to the Agreement, the Company was merged with and into IAC, the surviving
corporation in the Merger, which has continued its corporate existence under the
laws of the State of Florida under the name Women's Medical & Diagnostic Center,
Inc. ("WMDC"). Under the Agreement, Morris Notelovitz, M.D., Ph.D., the founder
of both the Company and NMF, (the "Physician") became a member of INMD's Board
of Directors, and under a long term employment agreement, the Physician will
serve as Vice President for Medical Affairs and Medical Director of INMD's new
WMDC Division. IAC simultaneously entered into an Employment Agreement with the
Physician pursuant to which the Physician is providing medical services, as
defined.
12
<PAGE>
WOMEN'S MEDICAL AND DIAGNOSTIC CENTER
NOTES TO COMBINED FINANCIAL STATEMENTS (continued)
INTEGRAMED AMERICA, INC.
Unaudited Pro Forma Consolidated Financial Information
Basis of Presentation
The transactions detailed below were accounted for by the purchase
method of accounting and the purchase price has been allocated to the tangible
and intangible assets acquired and liabilities assumed based upon the estimated
fair values at the date of acquisition. The unaudited consolidated financial
statements include the results of these transactions from their respective dates
of acquisition.
On June 7, 1996, IntegraMed America, Inc. (the "Company") entered into
an Agreement and Plan of Merger (the "Agreement") pursuant to which INMD
Acquisition Corp. ("IAC"), a Florida corporation and wholly-owned subsidiary of
the Company, acquired all of the outstanding stock of the following three
related Florida corporations: The Climacteric Clinic, Inc. ("CCI"), Midlife
Centers of America, Inc. ("MCA"), and Women's Research Centers, Inc. ("WRC"),
America (collectively "the Merger Companies"), and 51% of the outstanding stock
of the National Menopause Foundation, Inc. ("NMF"), also a related Florida
corporation. Pursuant to the Agreement, the Merger Companies were merged with
and into IAC, the surviving corporation in the Merger, which will continue its
corporate existence under the laws of the State of Florida under the name
Women's Medical & Diagnostic Center, Inc. ("WMDC"). In exchange for the shares
of the Merger Companies, the Company paid cash in an aggregate amount of
$350,000 and issued 666,666 shares of Common Stock which had a market value of
$2.5 million. In exchange for the 51% of the outstanding stock of NMF, the
Company paid cash in an aggregate amount of $50,000 and issued a note in an
amount of $600,000, which is payable in sixteen quarterly installments of
$37,500 beginning September 1, 1996 with simple interest at a rate of 4%.
The aggregate purchase price of the Merger Companies of $2,850,000 was
allocated as follows to assets acquired and liability assumed: $390,000 to
current assets, $99,000 to fixed assets, $254,000 to accrued liabilities,
$97,000 to debt and the balance of $2,712,000 to goodwill, which will be
amortized over a forty year period. The aggregate purchase price of NMF of
$650,000 was allocated as follows: $2,000 to current assets, $30,000 to fixed
assets, $10,000 to current liabilities and the $628,000 balance to goodwill,
which will be amortized over a forty year period.
On May 15, 1996, the Company entered into an asset purchase and a long
term management agreement with W.F. Howard, M.D., P.A. near Dallas, Texas (the
"Reproductive Science Center ("RSC") of Dallas"), a provider of conventional
infertility and assisted reproductive technology services. The aggregate
purchase price was approximately $701,500 of which approximately $244,000 was
paid at closing and the Company issued a promissory note for the $457,500
balance which is payable as follows: $100,000 on the last business day of May
1997 and 1998, and $36,786 on the last business day of May in each of the seven
years thereafter, thru May 2005. The aggregate purchase price was allocated to
fixed assets in the amount of $144,000 and the balance of $557,500 to exclusive
management rights, which will be amortized over the ten year term of the
agreement.
The following unaudited pro forma consolidated statement of operations
have been prepared by management and represent the consolidation of IntegraMed
America, Inc., the Merger Companies, NMF and the RSC of Dallas adjusted where
necessary, with respect to pre-acquisition periods, to the basis of accounting
used in the historical financial statements of the Company. Such adjustments
include modifying the results to reflect operations as if the related management
agreements had been consummated on January 1, 1996 and 1995, respectively.
Additional general corporate expenses which would have been required to support
the operations of the new Network sites are not included in the pro forma
results. The unaudited pro forma results may not be indicative of the results
that would have occurred if the acquisition and management agreement had been in
effect on the dates indicated or which may be obtained in the future.
13
<PAGE>
<TABLE>
INTEGRAMED AMERICA, INC.
Pro Forma Consolidated Statement of Operations
for the Six-Month Period Ended June 30, 1996
(all amounts in thousands, except per share amounts)
(unaudited)
<CAPTION>
Pro Forma
Historical Adjustments Consolidated
<S> <C> <C> <C>
Clinical revenues and management fees................... $ 8,998 $ 1,168 (a) $10,166
Medical Provider retainage.............................. 1,514 -- 1,514
------ ------- -------
Revenues after Medical Provider retainage............... 7,484 1,168 8,652
Costs of services rendered ............................. 5,550 1,257 (b) 6,807
Network sites' contribution ............................ 1,934 (89) 1,845
------ ------- -------
General and administrative expenses..................... 1,815 38 (c) 1,853
Research and development ............................... 128 -- 128
Goodwill and exclusive management right amortization.... 91 59 (d) 150
Interest income , net................................... (208) 9 (e) (199)
------ ------- -------
Total other expenses ................................... 1,826 106 1,932
------ ------- -------
Income (loss) before income taxes ...................... 108 (195) (87)
Provision for income and capital taxes ................. 97 -- 97
------ ------- -------
Net income (loss)....................................... 11 $ (195) (184)
=========
Less: Dividends accrued on Preferred Stock.............. 309 309
------ ------
Net loss applicable to Common Stock..................... $ (298) $ (493)
========= ========
Net loss per share of Common Stock...................... $ (.05) $ (.07)
========= ========
Weighted average number of shares of Common Stock
and Common Stock equivalents outstanding.............. 6,177 580 (f) 6,757
======== ========= ========
(a) To record net revenues earned during the period from January 1, 1996
through the date of acquisition related to the Merger Companies, NMF and
the RSC of Dallas.
(b) To record cost of services incurred during the period from January 1, 1996
through the date of acquisition related to the Merger Companies, NMF and
RSC of Dallas.
(c) To record compensation to Dr. Notelovitz as Vice President and Medical
Director of WMDC.
(d) To record amortization of exclusive management rights and goodwill incurred
during the period from January 1, 1996 through the date of acquisition.
(e) To record interest related to the note payable to Dr. Notelovitz and to
debt assumed.
(f) Assumes 666,666 shares were issued to Dr. Notelovitz on January 1, 1996.
This amount is net of the respective shares included in the historical June
6, 1996 weighted average number of shares of Common Stock outstanding.
14
</TABLE>
<PAGE>
<TABLE>
INTEGRAMED AMERICA, INC.
Pro Forma Consolidated Statement of Operations
for the Year Ended December 31, 1995
(all amounts in thousands, except per share amounts)
(unaudited)
<CAPTION>
Pro Forma
Historical Adjustments Consolidated
<S> <C> <C> <C>
Clinical revenues and management fees...................... $16,711 $ 3,488 (a) $20,199
Medical Provider retainage................................. 3,063 -- 3,063
-------- -------- --------
Revenues after Medical Provider retainage.................. 13,648 3,488 17,136
Costs of services rendered ................................ 9,986 3,389 (b) 13,375
Network sites' contribution ............................... 3,662 99 3,761
-------- --------- --------
General and administrative expenses........................ 3,680 75 (c) 3,755
Research and development .................................. 290 -- 290
Goodwill and exclusive management right amortization....... 73 140 (d) 213
Interest income , net...................................... (606) 32 (e) (574)
--------- --------- --------
Total other expenses ...................................... 3,437 247 3,684
-------- --------- --------
Income (loss) before income taxes ......................... 225 (148) 77
Provision for income and capital taxes .................... 155 -- 155
--------- --------- --------
Net income (loss).......................................... 70 $ (148) (78)
========
Less: Dividends accrued on Preferred Stock................. 600 600
--------- --------
Net loss applicable to Common Stock........................ $ (530) $ (678)
========= ========
Net loss per share of Common Stock......................... $ (.09) $ (.10)
========== =========
Weighted average number of shares of Common Stock
and Common Stock equivalents outstanding................. 6,087 667 (f) 6,754
======== ========= ========
(a) To record net revenues related to the Merger Companies, NMF and the RSC
of Dallas.
(b) To record cost of services related to the Merger Companies, NMF and RSC
of Dallas.
(c) To record compensation to Dr. Notelovitz as Vice President and Medical
Director of WMDC.
(d) To record amortization of goodwill and exclusive management rights.
(e) To record interest related to the note payable to Dr. Notelovitz and to
debt assumed.
(f) Assumes 666,666 shares were issued to Dr. Notelovitz on January 1, 1995.
</TABLE>
15
<PAGE>
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 thereunto duly authorized.
INTEGRAMED AMERICA, INC.
(Registrant)
Date: August 19, 1996 By: /s/ Dwight P. Ryan
------------------
Dwight P. Ryan
Vice President and
Chief Financial Officer
(Principal Financial and Accounting Officer)
16
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Exhibit
10.57-- Business Purposes Promissory Note dated September 8, 1993 in the
amount of $100,000
10.58-- Business Purposes Promissory Note dated November 18, 1994 in the
amount of $64,000
10.59-- Guaranty Agreement
10.60-- Security Agreement (Equipment and Consumer Goods)
17
September 8, 1993
BUSINESS PURPOSES PROMISSORY NOTE
$100,000.00
The Undersigned (whether one or more hereinafter called "Maker"), jointly and
severally, promise(s) to pay to the order of SunBank of Gainesville (herein
called "Bank") at its offices located at Gainesville, Florida, one hundred
thousand and 00/100 DOLLARS ($100,000), together with interest from the date
hereof at the rate hereinafter provided, in the following manner.
REPAYMENT SCHEDULE:
Payable in 59 monthly payments of $1667.00 principal including interest,
commencing on October 8, 1993 and on each successive month thereafter, together
with a final payment of any remaining principal and accrued interest on
September 8, 1998.
THE INTEREST RATE IS AS FOLLOWS:
Variable rate will be charged at 1% over the annual interest rate announced by
Sun Banks, Inc., from time to time as the prime rate (which interest rate is
only a bench mark, is purely discretionary and is not necessarily the best or
lowest rate charged borrowing customers of any subsidiary ban of Sun Banks,
Inc.). Any such changes in prime rate will increase or decrease your periodic
interest payments. Any change in prime rate shall be effective at the beginning
of the business day on which such a change is announced.
LATE CHARGE FEE: if a payment is late, you may be charged 5% of such payment as
a late charge. A payment which is not received on the due date shall be deemed
late.
SERVICE FEE: A service fee of the lesser of $50.00 or 2 percent of the principle
amount of this loan will be charged. The service fee charge will not be refunded
in the event of prepayment.
In the event any installment of principal or interest or any part thereof is not
paid when it becomes due, or in the event of any default thereunder, the
principal sum remaining unpaid hereunder, together with all accrued and past due
interest thereon, shall immediately and without notice become due and payable at
the election of the holder at any time thereafter. Notwithstanding any rate of
interest provided herein, the interest rate on any payment or payments of
principal or interest, or any part thereof, which is not made when due shall,
thereafter, be at the maximum rate allowed, from time to time, by law. Minimum
interest of $10.00 on any single payment loan or $15.00 on any installment loan
will be charged.
This note is SECURED (Notwithstanding the fact that this note may be
'unsecured', Maker understands and agrees that any other security interest the
Bank now holds or may hereafter acquire from the Maker may secure this note).
As security for the payment of this note Maker has pledged or deposited with
Bank and hereby grants to Bank a security interest in the following property:
Security in all accounts, chattel paper, documents, instruments, general
intangibles, furniture, fixtures inventory, machinery and equipment now owned
and hereafter acquired by the debtor including all products of additions to and
replacements thereof and all accessories, accessions, parts and replacement now
or hereafter affixed thereto or used in connection therewith and the proceeds of
all property set forth above.
(including all cash, stock and other dividends and all rights to subscribe for
securities incident to, declared, or granted in connection with such property
and including any returned or unearned premiums from any insurance financed
hereunder), which property, together with all additions and substitutions
hereafter pledged or deposited with Bank is called the Collateral. The
Collateral is also pledged as security for all other liabilities (primary,
secondary, direct, contingent, sole, joint, or several), due or to become due or
which may be hereafter contracted or acquired, of each Maker (including each
Maker and any other person) to Bank and for all renewals, extensions or
modifications of this note. The surrender of this note, upon payment or
otherwise, shall not affect the right of Bank to retain the Collateral for such
other liabilities.
Lender may request periodically as it deems necessary, complete and current
financial statements, balance sheets, profit and loss statements and cash flow
information for Maker and Cosigner.
Maker understands and agrees that the jury waiver, the additional agreements and
provisions on the reverse side hereof, hereby incorporated by reference,
constitute agreements of the Maker and a part of this note. Maker acknowledges
receipt of a completed copy of this note.
<PAGE>
NOTICE TO CONSIGNER: You are being asked to guarantee this debt. Think carefully
before you do. If the borrower doesn't pay the debt, you will have to. Be sure
you can afford to pay if you have to, and that you want to accept this
responsibility.
You may have to pay up to the full amount of the debt if the borrower does
not pay. You may also have to pay late fees or collection costs, which increase
this amount.
The bank can collect this debt from you without first trying to collect from
the borrower. The Bank can use the same collection methods against you that can
be used against the borrower, such as suing you, garnishing your wages, etc. If
this debt is ever in default, that fact may become a part of your credit record.
This notice is not the contract that makes you liable for the debt.
Maker:
The Climacteric Clinic, Inc. d/b/a
D.B.A. Women's Medical & Diagnostic Center
222 SW 36th Terr., Suite C
Gainesville, FL 32607
(Seal) /s/ Morris Notelovitz 9/8/93 date
----------------- ------
Morris Notelovitz, President
(Seal) date
(Seal) date
Note Amount: $100,000.00
Doc Stamps: $350.00
Other Fees: $28.00
Service Fee: $00.00
Proceeds: $100,000.00
Officer Init.: PH/JP Note #:
If the variable interest rate is not applicable and if this note is payable on
demand, Bank reserves, and is hereby granted the right, to adjust the interest
rate from time to time by furnishing Maker with written notice of such adjusted
rate provided, however, that no such adjusted rate shall exceed the maximum rate
allowed, from time to time by Law.
Additions to, reductions or exchanges of, or substitution for the Collateral,
payments on account of this note or increases of the same; or other loans made
partially or wholly upon the Collateral, may from time to time, be made without
affecting the provisions of this note.
If Bank deems itself insecure or upon the happening of any of the following
events, each of which shall constitute a default hereunder, all liabilities of
each Maker to Bank shall thereupon or thereafter, at the option of the Bank,
without notice or demand become due and payable; (a) failure of any Obligor (
which term shall mean and include each Maker, endorser, surety and guarantor of
this note), to perform any agreement hereunder, to pay interest hereon when due
or requested or demanded or to pay any other liability whatsoever to Bank when
due (b) the death of any Obligor, (c) the filing of any petition under the
Bankruptcy Code or any similar federal or state statute, by or against any
Obligor; (d) an application for appointment of a receiver or the making of
general assignment for the benefit of creditors by, or the insolvency of any
Obligor; (e) the entry of a judgment against any Obligor; (f) the issuing of any
writ of attachment or writ of garnishment, or the filing of any lien against the
property of any Obligor; (g) the taking of possession of any substantial part of
the property of any Obligor at the instance of any governmental authority; (h)
the dissolution, merger, consolidation or reorganization of any Obligor; (I) the
assignment by any Maker of any equity in any of the Collateral without the
written consent of Bank.
Bank is hereby given a lien upon and a security interest in all property of
each Maker now or at any time hereafter in the possession of Bank in any
capacity whatsoever, including but not limited to any balance or share of any
deposit, trust, or agent account as security for the payment of this note, and a
similar lien upon and security interest in all such property of each Maker as
security for the payment of all other liabilities of each Maker to Bank
(including liabilities of each Maker and any other person); and Bank shall have
the same rights as to such property as it has with respect to the Collateral.
If Bank deems itself insecure or upon the occurrence of any default hereunder
Bank shall have the remedies of a secured party under the Uniform Commercial
Code and, without limiting the generality of the foregoing, Bank shall have the
right, immediately and without further action by it, to set off against this
note all money owed by Bank in any capacity to each or any Obilgor, whether or
not due, and also to set off against all other liabilities of Maker to Bank all
money owed by Bank in any capacity to each or any Maker; and Bank shall be
deemed to have exercised such right of set off and to have made a charge against
any such money immediately upon the occurrence of such default even though such
a charge is made or entered on the books of Bank subsequent thereto. Unless the
Collateral is perishable or threatens to decline speedily in value or is of a
type customarily sold on a recognized market, the Bank will give Maker
reasonable notice of the time and place of any public sale thereof or of the
time after which any private sale or, any other intended disposition thereof is
to be made. The requirement of reasonable notice shall be met if such notice is
mailed; postage prepaid, to any Maker at the address given below or at any other
address shown on the records of the Bank, at least five days before the time of
the sale or disposition. Upon disposition of any Collateral after the occurrence
of any default hereunder, Maker shall be and remain liable for any deficiency;
and Bank shall account to Maker for any surplus, but Bank shall have the right
to apply all or any part of such surplus (or to hold the same as a reserve
against) any and all other liability of each or any Maker to Bank. The Obligors,
jointly and severally, promise and agree to pay all costs and expenses of
collection and reasonable attorneys' fee, including costs, expenses and
reasonable attorneys' fees on appeal, if collected by legal proceedings or
through an attorney at law. Maker hereby waives any right to a trial by jury in
any civil action arising out of, or based upon, this note or the Collateral.
Bank shall exercise reasonable care in the custody and preservation of the
Collateral to the extent required by applicable statute, and shall be deemed to
have exercised reasonable care if it takes such action for that purpose as Maker
shall reasonably request in writing, but no omission to do any act not requested
by Maker shall be deemed a failure to exercise reasonable care, and no omission
to comply with any request of Maker shall of itself be deemed a failure to
exercise reasonable care. Bank shall not be bound to take any steps necessary to
preserve any rights in the Collateral against prior parties and Maker shall take
all necessary steps for such purposes. Bank or its nominee need not collect
interest on or principal of any Collateral or give any notice with respect to
it.
If the Collateral shall at any time become unsatisfactory to Bank, Maker
shall within one day after demand pledge and deposit with Bank as part of the
Collateral additional property which is satisfactory to Bank.
Bank shall have the right, which may be exercised at any time, whether or not
this note is due, to notify the Obligors on any collateral to make payment to
Bank on any amounts due or to become due thereon. In the event of any default
hereunder, Bank shall thereafter have but shall not be limited to, the following
rights; (i) to pledge or transfer this note and the Collateral and Bank shall
thereupon be relieved of all duties and responsibilities hereunder and relieved
from any and all liability with respect to any Collateral so pledged or
transferred, and any pledgee or transferee shall for all purposes stand in the
place of Bank hereunder and have all the rights of Bank hereunder, (ii) to
<PAGE>
transfer the whole or any part of the Collateral into the name of itself or its
nominee, (iii) to vote the Collateral; (iv) to demand, sue for, collect, or make
any compromise or settlement it deems desirable with reference to the
Collateral; and (v) to take control of any proceeds of Collateral. No delay or
omission on the part of Bank in exercising any right hereunder shall operate as
a waiver of such right or of any other right under this note. Presentment,
demand, protest, notice of dishonor, and extension of time without notice are
hereby waived by each and every Obilgor. Any notice to Maker shall be
sufficiently served for all purposes if placed in the mail, postage prepaid,
addressed to or left upon the premises at the address shown below or any other
address shown on the Bank's records.
JURY WAIVER. MAKER AND BANK HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND
IRREVOCABLY WAIVE THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN
RESPECT TO ANY LITIGATION, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY,
BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT AND
ANY OTHER DOCUMENT OR INSTRUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR BANK ENTERING INTO THIS AGREEMENT. FURTHER, MAKER HEREBY
CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF BANK, NOR THE BANK'S COUNSEL, HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT, IN THE EVENT OF SUCH
LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. NO
REPRESENTATIVE OR AGENT OF THE BANK, NOR BANK'S COUNSEL HAS THE AUTHORITY TO
WAIVE, CONDITION, OR MODIFY THIS PROVISION.
FLORIDA DOCUMENTARY STAMP TAX REQUIRED BY LAW IN THE AMOUNT OF 4 HAS BEEN PAID
OR WILL BE PAID DIRECTLY TO THE DEPARTMENT OF REVENUE. CERTIFICATE OF
REGISTRATION #.
RENEWAL NOTE. STAMPS ON ORIGINAL.
"Florida documentary stamp tax required by law in the amount of
$prepaid has been paid or will be paid directly to the Department
of Revenue. Certificate of Registration
November 18, 1994
BUSINESS PURPOSES PROMISSORY NOTE
$64,000
The Undersigned (whether one or more hereinafter called "Maker"), jointly and
severally, promise(s) to pay to the order of SunBank/North Central Florida (FKA
Sun Bank of Gainesville) (herein called "Bank") at its offices located at Ocala,
Florida, sixty four thousand and 00/100 DOLLARS ($64,000), together with
interest from the date hereof at the rate hereinafter provided, in the following
manner.
REPAYMENT SCHEDULE:
Payable in 59 monthly payments of $1330.00 principal including interest,
commencing on December 18, 1994 and on each successive month thereafter,
together with a final payment of any remaining principal and accrued interest on
December 18, 1999.
THE INTEREST RATE IS AS FOLLOWS:
Fixed rate will be charged at 9% per annum, simple interest.
LATE CHARGE FEE: if a payment is late, you may be charged 5% of such payment as
a late charge. A payment which is not received on the due date shall be deemed
late.
SERVICE FEE: A service fee of the lesser of $50.00 or 2 percent of the principle
amount of this loan will be charged. The service fee charge will not be refunded
in the event of prepayment.
In the event any installment of principal or interest or any part thereof is not
paid when it becomes due, or in the event of any default thereunder, the
principal sum remaining unpaid hereunder, together with all accrued and past due
interest thereon, shall immediately and without notice become due and payable at
the election of the holder at any time thereafter. Notwithstanding any rate of
interest provided herein, the interest rate on any payment or payments of
principal or interest, or any part thereof, which is not made when due shall,
thereafter, be at the maximum rate allowed, from time to time, by law. Minimum
interest of $10.00 on any single payment loan or $15.00 on any installment loan
will be charged.
This note is SECURED (Notwithstanding the fact that this note may be
'unsecured', Maker understands and agrees that any other security interest the
Bank now holds or may hereafter acquire from the Maker may secure this note).
As security for the payment of this note Maker has pledged or deposited with
Bank and hereby grants to Bank a security interest in the following property:
MAM - 1 Package Bennett Contour Mammography System (Serial # SN B.C.-27977)
consisting of CTR Generator, System Plugs, Tube, Structure, Protective Radiation
Barrier, Printer, Compression Paddle, Bucky, Magnification System and Isolated
Spot Compression Cup.
(including all cash, stock and other dividends and all rights to subscribe for
securities incident to, declared, or granted in connection with such property
and including any returned or unearned premiums from any insurance financed
hereunder), which property, together with all additions and substitutions
hereafter pledged or deposited with Bank is called the Collateral. The
Collateral is also pledged as security for all other liabilities (primary,
secondary, direct, contingent, sole, joint, or several), due or to become due or
which may be hereafter contracted or acquired, of each Maker (including each
Maker and any other person) to Bank and for all renewals, extensions or
modifications of this note. The surrender of this note, upon payment or
otherwise, shall not affect the right of Bank to retain the Collateral for such
other liabilities.
Lender may request periodically as it deems necessary, complete and current
financial statements, balance sheets, profit and loss statements and cash flow
information for Maker and Cosigner.
Maker understands and agrees that the jury waiver, the additional agreements and
provisions on the reverse side hereof, hereby incorporated by reference,
constitute agreements of the Maker and a part of this note. Maker acknowledges
receipt of a completed copy of this note.
NOTICE TO CONSIGNER: You are being asked to guarantee this debt. Think carefully
before you do. If the borrower doesn't pay the debt, you will have to. Be sure
you can afford to pay if you have to, and that you want to accept this
responsibility.
You may have to pay up to the full amount of the debt if the borrower does
not pay. You may also have to pay late fees or collection costs, which increase
this amount.
The bank can collect this debt from you without first trying to collect from
the borrower. The Bank can use the same collection methods against you that can
be used against the borrower, such as suing you, garnishing your wages, etc. If
this debt is ever in default, that fact may become a part of your credit record.
This notice is not the contract that makes you liable for the debt.
<PAGE>
Maker:
The Climacteric Clinic, Inc.
D.B.A. Women's Medical & Diagnostic Center
222 SW 36th Terr., Suite C
Gainesville, FL 32607
(Seal) /s/ Morris Notelovitz 11/29/94 date
----------------- -------- ----
Morris Notelovitz, President
(Seal)
(Seal) date
Note Amount: $64,000.00
Doc Stamps: $224.00
Other Fees: $36.75
Service Fee: $50.00
Proceeds: $63,689.25
Officer Init.: PH/JP Note #:
If the variable interest rate is not applicable and if this note is payable on
demand, Bank reserves, and is hereby granted the right, to adjust the interest
rate from time to time by furnishing Maker with written notice of such adjusted
rate provided, however, that no such adjusted rate shall exceed the maximum rate
allowed, from time to time by Law.
Additions to, reductions or exchanges of, or substitution for the Collateral,
payments on account of this note or increases of the same; or other loans made
partially or wholly upon the Collateral, may from time to time, be made without
affecting the provisions of this note.
If Bank deems itself insecure or upon the happening of any of the following
events, each of which shall constitute a default hereunder, all liabilities of
each Maker to Bank shall thereupon or thereafter, at the option of the Bank,
without notice or demand become due and payable; (a) failure of any Obligor (
which term shall mean and include each Maker, endorser, surety and guarantor of
this note), to perform any agreement hereunder, to pay interest hereon when due
or requested or demanded or to pay any other liability whatsoever to Bank when
due (b) the death of any Obligor, (c) the filing of any petition under the
Bankruptcy Code or any similar federal or state statute, by or against any
Obligor; (d) an application for appointment of a receiver or the making of
general assignment for the benefit of creditors by, or the insolvency of any
Obligor; (e) the entry of a judgment against any Obligor; (f) the issuing of any
writ of attachment or writ of garnishment, or the filing of any lien against the
property of any Obligor; (g) the taking of possession of any substantial part of
the property of any Obligor at the instance of any governmental authority; (h)
the dissolution, merger, consolidation or reorganization of any Obligor; (I) the
assignment by any Maker of any equity in any of the Collateral without the
written consent of Bank.
Bank is hereby given a lien upon and a security interest in all property of
each Maker now or at any time hereafter in the possession of Bank in any
capacity whatsoever, including but not limited to any balance or share of any
deposit, trust, or agent account as security for the payment of this note, and a
similar lien upon and security interest in all such property of each Maker as
security for the payment of all other liabilities of each Maker to Bank
(including liabilities of each Maker and any other person); and Bank shall have
the same rights as to such property as it has with respect to the Collateral.
If Bank deems itself insecure or upon the occurrence of any default hereunder
Bank shall have the remedies of a secured party under the Uniform Commercial
Code and, without limiting the generality of the foregoing, Bank shall have the
right, immediately and without further action by it, to set off against this
note all money owed by Bank in any capacity to each or any Obilgor, whether or
not due, and also to set off against all other liabilities of Maker to Bank all
money owed by Bank in any capacity to each or any Maker; and Bank shall be
deemed to have exercised such right of set off and to have made a charge against
any such money immediately upon the occurrence of such default even though such
a charge is made or entered on the books of Bank subsequent thereto. Unless the
Collateral is perishable or threatens to decline speedily in value or is of a
type customarily sold on a recognized market, the Bank will give Maker
reasonable notice of the time and place of any public sale thereof or of the
time after which any private sale or, any other intended disposition thereof is
to be made. The requirement of reasonable notice shall be met if such notice is
mailed; postage prepaid, to any Maker at the address given below or at any other
address shown on the records of the Bank, at least five days before the time of
the sale or disposition. Upon disposition of any Collateral after the occurrence
of any default hereunder, Maker shall be and remain liable for any deficiency;
and Bank shall account to Maker for any surplus, but Bank shall have the right
to apply all or any part of such surplus (or to hold the same as a reserve
against) any and all other liability of each or any Maker to Bank. The Obligors,
jointly and severally, promise and agree to pay all costs and expenses of
<PAGE>
collection and reasonableattorneys' fee, including costs, expenses and
reasonable attorneys' fees on appeal, if collected by legal proceedings or
through an attorney at law. Maker hereby waives any right to a trial by jury in
any civil action arising out of, or based upon, this note or the Collateral.
Bank shall exercise reasonable care in the custody and preservation of the
Collateral to the extent required by applicable statute, and shall be deemed to
have exercised reasonable care if it takes such action for that purpose as Maker
shall reasonably request in writing, but no omission to do any act not requested
by Maker shall be deemed a failure to exercise reasonable care, and no omission
to comply with any request of Maker shall of itself be deemed a failure to
exercise reasonable care. Bank shall not be bound to take any steps necessary to
preserve any rights in the Collateral against prior parties and Maker shall take
all necessary steps for such purposes. Bank or its nominee need not collect
interest on or principal of any Collateral or give any notice with respect to
it.
If the Collateral shall at any time become unsatisfactory to Bank, Maker
shall within one day after demand pledge and deposit with Bank as part of the
Collateral additional property which is satisfactory to Bank.
Bank shall have the right, which may be exercised at any time, whether or not
this note is due, to notify the Obligors on any collateral to make payment to
Bank on any amounts due or to become due thereon. In the event of any default
hereunder, Bank shall thereafter have but shall not be limited to, the following
rights; (i) to pledge or transfer this note and the Collateral and Bank shall
thereupon be relieved of all duties and responsibilities hereunder and relieved
from any and all liability with respect to any Collateral so pledged or
transferred, and any pledgee or transferee shall for all purposes stand in the
place of Bank hereunder and have all the rights of Bank hereunder, (ii) to
transfer the whole or any part of the Collateral into the name of itself or its
nominee, (iii) to vote the Collateral; (iv) to demand, sue for, collect, or make
any compromise or settlement it deems desirable with reference to the
Collateral; and (v) to take control of any proceeds of Collateral.
No delay or omission on the part of Bank in exercising any right hereunder
shall operate as a waiver of such right or of any other right under this note.
Presentment, demand, protest, notice of dishonor, and extension of time without
notice are hereby waived by each and every Obilgor. Any notice to Maker shall be
sufficiently served for all purposes if placed in the mail, postage prepaid,
addressed to or left upon the premises at the address shown below or any other
address shown on the Bank's records.
JURY WAIVER. MAKER AND BANK HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND
IRREVOCABLY WAIVE THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN
RESPECT TO ANY LITIGATION, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY,
BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT AND
ANY OTHER DOCUMENT OR INSTRUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR BANK ENTERING INTO THIS AGREEMENT. FURTHER, MAKER HEREBY
CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF BANK, NOR THE BANK'S COUNSEL, HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT, IN THE EVENT OF SUCH
LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION. NO
REPRESENTATIVE OR AGENT OF THE BANK, NOR BANK'S COUNSEL HAS THE AUTHORITY TO
WAIVE, CONDITION, OR MODIFY THIS PROVISION.
- --------------------------------------------------------------------------------
FLORIDA DOCUMENTARY STAMP TAX REQUIRED BY LAW IN THE AMOUNT OF 4 HAS BEEN PAID
OR WILL BE PAID DIRECTLY TO THE DEPARTMENT OF REVENUE. CERTIFICATE OF
REGISTRATION #.
RENEWAL NOTE. STAMPS ON ORIGINAL.
GUARANTY AGREEMENT
This absolute and unconditional guaranty given by the undersigned, hereinafter
called the "Guarantor" (and if more than one then collectively and jointly and
severally referred to as the "Guarantor"), to induce SunBank/North Central
Florida, a State Bank hereinafter called "Creditor" having a business address of
P.O. Box 310; Ocala, FL 34478 to extend credit to or otherwise become or remain
the creditor of
The Climacteric Clinic, Inc.
DBA Women's Medical & Diagnostic Center
222 SW 36th Terr., Suite C
Gainesville, FL 32607
hereinafter called the "Borrower".
In consideration of the foregoing, the Guarantor does hereby agree with the
Creditor as follows:
1. OBLIGATION OF GUARANTOR. The Guarantor absolutely and unconditionally
guarantees to the Creditor, its successors and assigns (whether collateral
assigns or otherwise), the prompt and full payment in United States currency and
performance to the Creditor at the place of business of the Creditor set forth
above or at such other place and to such other person as the Creditor may
designate at maturity of any and every obligation, in connection with which
either as maker, drawer, guarantor, endorser or otherwise, whether directly,
indirectly or contingently, the Borrower is, either individually or jointly or
severally with any other person or persons, now or shall become at any time in
the future liable to the Creditor, with interest thereon at the rate or rates
provided in the obligations guaranteed hereby or at the maximum rate allowed
from time to time by law in Florida, whichever is less, until payment in full
has been received by Creditor, together with all attorneys' fees, costs and
expenses of collection whether suit be brought or not, including costs, expenses
and attorneys' fees on appeal if an appeal is taken from any suit, incurred by
the Creditor, in connection with any matter covered by this Guaranty. The
Guarantor also absolutely and unconditionally guarantees the full and timely
performance of all duties and obligations whatsoever of the Borrower to
Creditor, whether now existing or hereafter arising, and agrees in the event the
Borrower fails to fully and timely perform any of said duties and obligations to
fully and timely perform same.
2. TERM OF GUARANTY. The liability of the Guarantor hereunder shall continue the
earlier (I) one (1) year after this Guaranty is marked "Canceled" by the
Creditor and returned to the Guarantor or, (ii) until the Creditor shall receive
written notice, by registered mail signed by the Guarantor, canceling the
Guaranty, but such cancellation shall not affect in any way the continuing
liability of the Guarantor on any transactions covered by this Guaranty up to
the time of the actual receipt by the Creditor of such notice of cancellation,
including any advance or other monies which may at any time thereafter be made
by the Creditor to the Borrower pursuant to any agreement, promissory note or
other instrument or document evidencing any indebtedness of the Borrower to the
Creditor, entered into prior to the receipt by the Creditor of said notice by
the Guarantor. Notwithstanding the receipt by the Creditor of any notice of
cancellation hereunder, the Creditor may in its discretion amend, modify and
renew in any way whatsoever any agreement, promissory note or other instrument
or document evidencing any indebtedness of the Borrower to the Creditor and in
existence at the time said notice of cancellation is received by the Creditor,
all without affecting in any way whatsoever the continuing liability of the
Guarantor hereunder, but the liability of the Guarantor solely in regard to the
principal amount owed the Creditor shall not exceed the amount of principal
owing to the Creditor at the time said notice of cancellation is received by the
Creditor together with such additional amounts as may thereafter be advanced by
the Creditor to or on behalf of the Borrower pursuant to any such agreement,
promissory note or other instrument or document in existence at the time said
notice is received by the Creditor. In the event said notice of cancellation is
given, the liability of the Guarantor shall continue without limitation
whatsoever for all amounts other than principal (which is limited under the
preceding sentence) due the Creditor such as interest, attorney's fees, costs,
and other such amounts.
3. BANKRUPTCY OF BORROWER. notwithstanding the Guaranty may have been canceled
under paragraph 2, and/or returned to the Guarantor, to the extent the Borrower
has made any payments to the Creditor within the one (1) year period following
the date this Guaranty was so canceled, and the Guarantor was obligated under
this Guaranty for said payments, the liability of the Guarantor hereunder shall
at all time continue for the amounts so paid by the Borrower to the Creditor.
If, for any reason, (e.g. bankruptcy, or otherwise), the Creditor is not
permitted to retain the payments so made by the Borrower during said one (1)
year period, the Guarantor shall be liable under this Guaranty for the amount of
such payments as if this Guaranty had never been canceled and the Creditor shall
be entitled to recover said amount so paid by the Borrower within said one (1)
year period. Anything in this Guaranty to the contrary notwithstanding, if at
any tine this Guaranty is to be canceled under the provisions of paragraph 2,
the Creditor may retain this Guaranty for a period of one (1) year after the
date said Guaranty is to be so canceled and in the event no bankruptcy petition
has been filed by or against the Borrower for the one (1) year period following
the date the Guaranty is to be canceled, then, in that event, the Guaranty shall
be returned to the Guarantor. If, however, a bankruptcy petition has been filed
by or against the Borrower during the one (1) year period, and the Borrower has
made payments to the Creditor during the one (1) year period, this Guaranty
shall not be canceled and/or returned to the Guarantor unless and until a
decision by a court of competent jurisdiction, or other agreement has been
entered or reached, pursuant to which the Creditor shall be entitled to retain
all such monies paid during the one (1) year period. If as set forth above, the
Creditor is obligated to return to the Borrower any monies so paid during the
one (1) year period, this Guaranty shall not be canceled (notwithstanding it
being marked "Canceled" and returned to the Guarantor) and the Guarantor shall
continue to be liable to the Creditor for all monies paid during the one (1)
year period. If the Creditor shall have marked this Guaranty "Canceled" and/or
returned this Guaranty to the Guarantor, and under the provisions of this
paragraph 3 or paragraph 2, the Guarantor has continuing liability to the
Creditor for certain amounts which the Creditor has or is obligated to return to
the Borrower, than, in such case, the Creditor may enforce its rights under this
Guaranty upon any copy of this Guaranty notwithstanding the fact that the
original of this guaranty may have been marked "Canceled" and/or returned to the
Guarantor.
4. CONSENT TO CREDITOR'S ACTS. The Guarantor consents, without affecting in any
way the Guarantor's liability to the Creditor hereunder, that the Creditor may,
without notice to or consent of the Guarantor and upon such terms as it may deem
advisable and with or without consideration and after notice of cancellation is
received by the Creditor under paragraph 2 hereof: (a) extend, in whole or in
part, by renewal or otherwise, and as often as the Creditor may wish, the time
of payment of any indebtedness owing by the Borrower, the Creditor, or held by
the Creditor as security for any such obligation; (b) release, surrender,
exchange, modify, impair, or extend the period of duration, or the time for
performance or payment, of any collateral securing any obligation of the
Borrower to the Creditor; (C) settle or compromise any claim of the Creditor
against the Borrower, or against any other person, firm or corporation, whose
obligation is held by the Creditor as collateral security for any obligation of
the Borrower to the Creditor; and (d) release in whole or in part any person
liable for the payment of any obligation of the Borrower to the Creditor
including, but not limited to, any person liable as an endorser, guarantor or
judgment debtor (if the Creditor obtains a judgment on any obligation of the
Borrower) of said obligation and, in any event, any such release shall not
affect the liability of the Guarantor for the entire amount any and every
obligation of the Borrower to the Creditor. Further, the Creditor shall not be
under any obligation whatsoever to obtain or perfect or to maintain the
perfection of any security interest or other lien on property to secure
indebtedness of the Borrower to the Creditor and the Creditor shall have no
obligation to, and shall not have any liability for failing to, obtain or
perfect or to maintain the perfection of any security interest or lien on
property to secure indebtedness of the Borrower. Any failure of the Guarantor to
the Creditor under this Guaranty. The Guarantor hereby ratifies and confirms any
such extension, renewal, release, surrender, exchange, modification, impairment,
settlement, or compromise, and all such actions shall be binding upon the
Guarantor who hereby waives all defenses, counterclaims, or offsets which the
Guarantor might have by reason thereof.
<PAGE>
5. WAIVERS BY GUARANTOR. The Guarantor waives: (a) notice of acceptance of this
Guaranty by the Creditor; (b) notice of presentment, demand for payment, notice
of dishonor or protest of any of the Borrower's obligations or the obligation of
any person, firm, or corporation held by the Creditor as collateral security for
the Borrower's obligation; (C) notice of the failure of any person, firm, or
corporation to pay to the Creditor any indebtedness held by the Creditor as
collateral security for any obligation of the Borrower; (d) failure of the
Creditor to obtain and perfect or maintain the perfection or priority of any
security interest or lien on property to secure any indebtedness of the
Borrower; and (e) all defenses, offsets and counterclaims which the Guarantor
may at any time have to any claim of the Creditor against the Borrower.
6. SUBROGATION. Nothing herein contained is intended or shall be construed to
give to Guarantor any right of subrogation in or under any note, security
document or any other loan document evidencing in any way or relating to any
obligation of the Borrower to the Creditor which is or may be covered by this
Guaranty, any right to participate in any way therein, or in the right, title
and interest of the Creditor in and to any collateral covered by any loan or
security documents relating to any such obligations notwithstanding any payments
made by Guarantor under this Guaranty, all such rights of subrogation and
participation being hereby expressly waived and released.
8. REPRESENTATIONS BY GUARANTOR. The Guarantor represents that, at the time of
the execution and delivery of this Guaranty, nothing exists to impair the
effectiveness of the liability of the Guarantor to the Creditor hereunder, or
the immediate taking effect of this Guaranty as the sole agreement between the
Guarantor and the Creditor with respect to guaranteeing the Borrower's
obligation to the Creditor.
9. REMEDIES OF CREDITOR. The Creditor may at its option proceed in the first
instance against the Guarantor to collect any obligation covered by this
Guaranty, without first proceeding against the Borrower for said obligation, or
any other person, firm or corporation liable for said obligation, and without
first resorting to any property at any time held by the Creditor as collateral
security for said obligation and without any marshaling of assets whatsoever.
The Guarantor hereby grants to the Creditor a lien on, and a security interest
in, the deposit balances, funds, accounts, items, certificates of deposit,
securities, other property and the moneys of the Guarantor now or hereafter in
the possession or custody of Creditor for any purpose (including property left
in safekeeping or custody) or on deposit with the Creditor to secure, and as
collateral for, the payment and performance of this Guaranty as well as of any
other obligation or liability (present or future, absolute or contingent, due or
not due ) of Guarantor to Creditor. The Creditor may at any time and from time
to time, without demand or notice, appropriate and set off against such deposit
balances, funds, accounts, items, certificates of deposit, securities, other
property and moneys and apply the same to the obligations of the Guarantor
hereunder. The Creditor shall further have any other rights provided by law or
under any other document, all of which rights are cumulative.
10. CONSTRUCTION AND BENEFIT. This Guaranty is delivered and made in, and shall
be construed pursuant to and governed by, the laws of the State of Florida, and
is binding upon the Guarantor and his legal representatives and successors, and
shall inure to the benefit of the Creditor, its successors and assigns.
11. MISCELLANEOUS. In the event it becomes necessary for the Creditor to
exercise its rights under this Guaranty, whether suit be brought or not, the
Guarantor shall be liable for all costs and attorneys' fees incurred by the
Creditor, including costs and attorney's fees incurred by the Creditor on
appeal. To the extent the Guarantor is obligated to make any payments to the
Creditor under this Guaranty, the Creditor may offset and retain in payment of
said amounts any and all monies of the Guarantor in the possession of the
Creditor at any item, including, but not limited to, any accounts of the
Guarantor at the Creditor. In the further event the Creditor obtains a final
judgment against the Guarantor upon this Guaranty, the judgment shall bear
interest not at the judgment but at the highest rate permitted by applicable law
from time to time in effect at the time of said judgment. Further, the Guarantor
agrees that the proper venue for any action which may be brought under this
Guaranty, in addition to any other venue permitted by law, shall be in the
county in which is located the Creditor's business office as designated above or
the office of an assignee of this Guaranty. The liability of the Guarantor
hereunder, if more than one, shall be joint and several. The term "Creditor"
shall be deemed to include the aforementioned Creditor and all its departments
and any individual, partnership or corporation acting as its nominee or agent,
and any of its corporate subsidiaries or affiliates, the stock of which is owned
or controlled, directly or indirectly, by it or by any affiliate of the
Creditor. The term "Borrower" shall include the individual or individuals,
association, partnership, corporation or other entity named herein as Borrower
and (a) any successor individual or individuals, association, partnership,
corporation or other entity to which all or substantially all of the business or
assets of said Borrower shall have been transferred, (b) in the case of a
partnership Borrower, any new partnership which shall have been created by
reason of the admission of any new partner or partners therein and/or the
dissolution of the existing partnership by the death, resignation or other
withdrawal of any partner, and (C) in the case of a corporate Borrower, any
other corporation into or with which said Borrower shall have been merged,
consolidated, reorganized, purchased or absorbed.
12. FINANCIAL STATEMENTS. At the request of the Creditor, the Guarantor shall,
from time to time, prepare and deliver to the Creditor a complete and current
financial statement of the Guarantor setting forth all the assets and
liabilities of the Guarantor (and to the extent any person other than the
Guarantor has any interest in said assets or any person other than the Guarantor
is jointly liable for any of said obligations, said matters shall be set forth
in their entirety in the financial statements) all signed by the Guarantor under
oath as being true and correct. To the extent any assets or liabilities set
froth on said financial statement are owned by the Guarantor with his or her
spouse or for which there is any such joint liability, all said assets shall be
so specified and set forth.
13. BORROWER DEFENSES. This Guaranty remains fully enforceable irrespective of
any defenses or counterclaims that the borrower may assert on the underlying
debt, including but not limited to failure of consideration, breach of warranty,
fraud, payment, statute of frauds, bankruptcy, infancy, statute of limitations,
lender liability, accord and satisfaction, and usury. 14. COMPLETE AGREEMENT.
The whole of this Guaranty is herein set forth and there is no verbal or other
written agreement, and no understanding or custom affection the terms hereof.
This Guaranty can be modified only by a written instrument signed by the party
to be charged therewith.
<PAGE>
NOTICE TO COSIGNER: You are being asked to guarantee this debt as well as all
past and future debts of the Borrower entered into with this Bank. Think
carefully before you do. If the borrower doesn't pay the debt, you will have to.
Be sure you can afford to pay if you have to, and that you want to accept this
responsibility.
You may have to pay up to the full amount of the debt if the borrower does
not pay. You may also have to pay late fees or collection costs, which increase
this amount.
The Bank can collect this debt from you without first trying to collect from
the borrower. The Bank can use the same collection methods against you that can
be used against the borrower, such as suing you, garnishing your wages, etc. If
this debt is ever in default, that fact may become a part of your credit
records.
This notice is not the contract that makes you liable for the debt.
IN WITNESS WHEREOF, the Guarantor has signed this agreement on the 29th day of
November, 1994.
Signed, sealed and delivered in the presence of:
GUARANTOR(S)
/s/Paul Haven /s/Morris Notelovitz
- ------------- --------------------
WITNESS Morris Notelovitz
/s/Janell K. Candler
- --------------------
ADDRESS:
STATE OF FLORIDA
COUNTY OF Alachua
The foregoing instrument was acknowledged before me by Dr. Notelovitz on the
29th day of November 1994 who is personally known to me/produced the following
identification:
/s/ Suzzane A. Oliver
- ---------------------
Notary Public
My Commission Expires: October 12, 1998
My Commission # CC412963
SECURITY AGREEMENT
(EQUIPMENT AND CONSUMER GOODS)
The Climacteric Clinic, Inc.
DBA Women's Medical & Diagnostic Center
222 SW 36th Terr., Suite C
Gainesville, FL 32607
(And if more than one, each of them jointly and severally), hereinafter called
"Borrower", for value received and intending to be legally bound, hereby grants
to
SunBank/North Central Florida
P.O. Box 310
Ocala, FL 34478
hereinafter called "Secured Party", a security interest in the following
property:
MAM - 1 Package Bennett Contour Mammography System (Serial # SN BMC-27977)
consisting of CTR Generator, System Plugs, Tube, Structure, Protective Radiation
Barrier, Printer, Compression Paddle, Bucky, Magnification System and Isolated
Spot Compression Cup.
together with all increases, parts, fittings, accessories, equipment, and
special tools now or hereafter affixed to any or any part thereof or used in
connection with any thereof, and all replacements of all or any part thereof
plus any returned or unearned premiums from any insurance financed by the
Secured party in conjunction with this transaction (all of which is hereinafter
called "Collateral"), to secure the payment of a promissory note or notes
executed by Borrower in the amount of: Sixty Four Thousand and 00/100 dollars
($64,000.00) of even date herewith, and any and all extensions, modifications or
renewals thereof, and also to secure the performance by Borrower of the
agreements hereinafter set forth, and all liabilities or obligations (primary,
secondary, direct, contingent, sole, joint or several) due, or to become due or
which may be hereafter contracted or acquired of each Borrower to Secured Party
(the foregoing hereinafter being called the "Liabilities").
Borrower hereby warrants and agrees that:
1. (a) Borrower is the owner of the Collateral clear of all liens and security
interests except the security interest granted hereby; (b) Borrower has the
right and power to make this Agreement; and (c) The Collateral is used or
acquired for use primarily for the purpose checked: Personal, family or
household purposes; Farm purposes; or X business purposes, and (d) if the
Collateral consists of "household goods" ad defined in 12 C.F.R. 227.12 (d) or
if otherwise checked here then the Collateral is being acquired with the
proceeds of the loan provided for in or secured by this Agreement, and the
proceeds will be used for no other purpose, and Borrower hereby authorized
Secured party to disburse the proceeds or any part thereof directly to the
seller of the Collateral or to the insurance agent or broker, or both, as shown
on Secured Party's records.
2. (a) The Collateral will be kept at the address shown at the beginning of this
Agreement, OR
Borrower will promptly notify Secured Party of any change in the location of the
Collateral within said state; and Borrower will not remove the Collateral from
said state without the written consent of Secured Party, (b) if the Collateral
is used or acquired for use primarily for personal, family or household
purposes, or for farm purposes, Borrower's residence in Florida is that shown at
the beginning of this Agreement and Borrower will immediately notify Secured
Party of any change in the location of said residence.
3. (a) If the Collateral is acquired or used primarily for business use and is
of a type normally used in more than one state, whether or not so used, and
Borrower has a place of business in more than one state, the chief place of
business of Borrower is that shown at the beginning of the Agreement, OR
and Borrower will immediately notify Secured Party in writing of any change in
Borrower's chief place of business; and (b) if certificates of title are issued
or outstanding with respect to any of the Collateral, Borrower will promptly
cause the interest of Secured party to be properly noted thereon and deliver
such certificates of title to Secured Party.
4. Borrower will defend the Collateral against the claims and demands of all
persons, other than Secured Party, at any time claiming the same or any interest
therein.
5. No Financing Statement covering any Collateral or any proceeds thereof is on
file in any public office; Borrower authorized Secured party to file, in
jurisdictions where this authorization will be given effect, a Financing
Statement signed only by the Secured party describing the collateral in the same
manner as it is describe herein; Borrower will from time to time at the request
of Secured party, execute one or more Financing Statements and such other
documents (and pay the cost of filing or recording the same in all public
offices deemed necessary or desirable by the Secured party) and do such other
acts and things, all as the Secured Party may request to establish and maintain
an enforceable first priority security interest in the Collateral (free of all
other liens and claims whatsoever) to secure the payment of the Liabilities.
6. Borrower will not (a) permit any liens or security interest other than
Secured party's security interest, to attach to any of the Collateral; (b)
permit any of the Collateral to be levied upon under legal process; (C) sell,
transfer, lease, dismantle, alter, modify, or otherwise dispose of any of the
Collateral or any interest therein, or offer so to do, without the prior written
consent of Secured Party; (d) permit anything to be done that may impair the
value of any of the Collateral or the security intended to be afforded by this
Agreement; (e) permit the Collateral to be or become a fixture (and it is
<PAGE>
expressly covenanted, warranted and agreed, that the Collateral, and every part
thereof, whether affixed to any realty or not, shall be and remain personal
property), or to become an accession to other goods or property, or (f) locate
Collateral on any property not owned or controlled by Borrower, without the
prior written consent of the Secured party.
7. Borrower will (a) at all times keep the Collateral insured in amounts not
less than the full insurable value thereof, against loss, damage, theft, and
such other risks as Secured party may require in such companies, under such
policies, in such form and for such periods, as shall be satisfactory to Secured
Party, and each such policy shall provide, by New York Standard or Union
Standard endorsement, that loss thereunder and proceeds payable thereunder shall
be payable to Secured party as its interest may appear (and Secured Party may
apply any proceeds of such insurance which may be received by Secured party
toward payment of the Liabilities, whether due or not due, in such order of
application as Secured Party may determine) and each such policy shall provide
for a minimum of 10 days written cancellation notice to Secured party; and each
such policy shall, if Secured Party so requests, be deposited with Secured Party
and Secured Party may act as attorney for Borrower in obtaining, adjusting,
settling, and canceling such insurance and endorsing any drafts; (b) at all
times keep the Collateral free from any adverse lien security interest, or
encumbrance and in good order and repair and will not waste or destroy the
Collateral or any part thereof, (c) Borrower shall be obligated to pay for the
placement of any Vendor Single Interest Insurance ("VSI"), or any other similar
type of insurance, should the Borrower fail to adequately protect the
Collateral. Should VSI or any other insurance be placed by the Secured Party,
then any Earned and/or Unearned insurance Premium Refund will be credited to
Borrower by the Secured party. Should the Secured Party receive any compensation
for Administrative or Experience Rated Refunds due to the placement and
termination of such insurance, such compensation and/or refund shall be paid to
Secured Party. Any interest earned during the period of placement of such
insurance any be retained by Secured Party.
8. (a) Borrower will not use the Collateral or permit the same to be used in
violation of any statute, law or ordinance; and Secured Party may examine and
inspect the Collateral at any time, wherever located, (b) Borrower will pay
promptly when due all taxes and assessments upon the Collateral or for its use
of operation or upon this Agreement or upon any note or notes or other writing
evidencing the Liabilities, or any of them.
9. At its options, Secured Party may discharge taxes, liens or security
interests or other encumbrances at any time levied or placed on the Collateral,
may pay for insurance on the Collateral, and may pay for the maintenance and
preservation of the Collateral. Borrower agrees to reimburse Secured Party on
demand for any payment made, or any expense incurred, by Secured Party, pursuant
to the foregoing authorization, together with interest thereon at the highest
lawful rate and each such payment and interest thereon shall be secured by this
Security Agreement. Until default, Borrower may have possession of Collateral
and use it in any lawful manner not inconsistent with this Agreement and not
inconsistent with any policy of insurance thereon.
10. Borrower shall be in default under this Agreement upon the happening of any
of the following events or conditions: (a) failure or omission to pay when due
any Liability (or any installment thereof or interest thereon), or default in
the payment or performance of any obligation, covenant, agreement, or Liability
contained or referred to therein; (b) any warranty, representation, or statement
made or furnished to Secured Party by or on behalf of any Borrower proves to
have been false in any material respect when made or furnished; (c) loss, theft,
substantial damage destruction, sale, or encumbrance to or of any of the
Collateral, or the making of any levy, seizure, or attachment thereof or
thereon; (d) any Obligor (which term as used herein, shall mean each Borrower
and each other Party primarily or secondarily or contingently liable on any of
the Liabilities) becomes insolvent or unable to pay debts as they mature or
makes an assignment for the benefit of creditors, or any proceeding (including
any proceeding in bankruptcy) is instituted by or against any Obligor alleging
that such Obligor is insolvent or unable to pay debts as they mature; (e) entry
of any judgment against any Obligor; (f) death of an Obligor who is a natural
person, or of any partner of any Obligor which is a partnership; (g)
dissolution, merger or consolidation, or transfer of a substantial part of the
property of any Obligor which is a corporation or partnership; (h) appointment
of a receiver for the Collateral or any part thereof or for any property in
which any Borrower has an interest; (i) the Collateral is used by anyone to
transport or store goods the possession, transportation or use of which is
illegal.
11. Upon the occurrence of any such default or at any time thereafter, or
whenever the Secured Party feels insecure for any reason whatsoever, Secured
Party may, at its option, declare all Liabilities secured hereby or any of them
(notwithstanding any provisions thereof), immediately due and payable without
demand or notice of any dink and the same thereupon shall immediately become and
be due and payable without demand or notice (but with such adjustments, if any,
with respect to interest or other charges as may be provided for in the
promissory note or other writing evidencing such Liability), and Secured party
shall have any may exercise from time to time any and all rights and remedies of
a Secured Party under the Uniform Commercial Code and any and all rights and
remedies available to it under any other applicable law; and upon request or
demand of Secured Party, Borrower shall, at its expense, assemble the Collateral
and make it available to the Secured Party at a convenient place acceptable to
Secured Party; and Borrower shall promptly pay all costs of Secured party of
collection of any and all liabilities, and enforcement of any rights hereunder,
including reasonable attorneys' fees and legal expenses and expenses of any
repairs to any of the Collateral and expenses of any repairs to any realty or
other property to which any of the Collateral may be affixed. Any notice of
sale, disposition or other intended action by Secured Party, sent to Borrower at
the address of Borrower specified above or at any other address shown on the
records of Secured Party, at least five days prior to such action, shall
constitute reasonable notice to Borrower, In the event of repossession Borrower
authorizes Secured Party to take into custody any personal property found in or
on the Collateral and to hold the same until claimed by Borrower at the
principal place of business of Secured Party and in the event such personal
property is not claimed within a reasonable time by Borrower, Secured Party is
authorized to dispose of same. Expenses of retaking, holding preparing for sale,
selling, or the like, shall include Secured Party's reasonable attorneys' fees
and legal expenses. Any excess or surplus of proceeds of any disposition of any
of the Collateral may be applied by Secured Party toward payment of such of the
Liabilities, without marshaling of assets and in such order of application, as
secured party may from time to time elect.
12. No waiver by Secured Party of any default shall operate as a waiver of any
other default or of the same default on a future occasion. No delay or omission
on the part of Secured party in exercising any right or remedy shall operate as
a waiver thereof, and no single or partial exercise by Secured Party of any
right or remedy shall preclude any other or further exercise thereof or the
exercise of any other right or remedy. Time is of the essence of this Agreement.
The provisions of this Agreement are cumulative and in addition to the
provisions of any note secured by this Agreement, and Secured Party shall have
all the benefits, rights and remedies of and under any not secured hereby. If
more than one party shall execute this Agreement, the term "Borrower" shall mean
all parties signing this Agreement and each of them, and all such parties shall
be jointly and severally obligated hereunder provided, however, if one of the
parties signing this Agreement has not executed the promissory note or notes
referred to herein, said party shall have no personal liability under, or in
conjunction with, said promissory note or notes. The singular pronoun, when used
herein, shall include the plural and the neuter shall include masculine and
feminine. If this Agreement is not dated when executed by the Borrower, the
Secured Party is authorized without notice to the Borrower, to date this
Agreement. This Agreement shall become effective as of the date of this
Agreement. All rights of Secured Party hereunder shall inure to the benefit of
its successors and assigns; and all Liabilities of Borrower shall bind the
heirs, executors, administrators, successors and assigns of each Borrower.
<PAGE>
13. This Agreement has been delivered in the State of Florida and shall be
construed in accordance with laws of Florida. Wherever possible, each provision
of this Agreement shall be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement.
14. BORROWER AND SECURED PARTY HEREBY KNOWINGLY, VOLUNTARILY, INTENTIONALLY, AND
IRREVOCABLY WAIVE THE RIGHT EITHER OF THEM MAY HAVE TO A TRIAL BY JURY IN
RESPECT TO ANY LITIGATION, WHETHER IN CONTRACT OR TORT, AT LAW OR IN EQUITY,
BASED HEREON, OR ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT AND
ANY OTHER DOCUMENT OR INSTRUMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO. THIS PROVISION IS A MATERIAL
INDUCEMENT FOR SECURED PARTY ENTERING INTO THIS AGREEMENT. FURTHER BORROWER
HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF SECURED PARTY, NO THE
SECURED PARTY'S COUNSEL, HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SECURED
PARTY WOULD NOT, IN THE EVENT OF SUCH LITIGATION, SEEK TO ENFORCE THIS WAIVER OR
RIGHT TO JURY TRIAL PROVISION, NO REPRESENTATIVE OR AGENT OF THE SECURED PARTY,
NO SECURED PARTY'S COUNSEL HAS THE AUTHORITY TO WAIVE, CONDITION, OR MODIFY THIS
PROVISION.
IN WITNESS WHEREOF, this Agreement has been duly executed as of November 18,
1994.
Signed, sealed and delivered in the presence of:
Borrower(s):
The Climacteric Clinic, Inc.
DBA Women's Medical & Diagnostic
Center 222 SW 36th Terrace, Suite C
Gainesville, FL 32607
/s/Paul Haven /s/Morris Notelovitz (SEAL)
- ------------- --------------------
Morris Notelovitz, President
/s/Suzanne A. Oliver (SEAL)
- --------------------
(SEAL)
