EXHIBIT 99.2
THIRD AMENDMENT TO LOAN AGREEMENT
This Third Amendment to Loan Agreement (this "Amendment") is entered into
as of January 31, 2005, by and between COMERICA BANK ("Bank"), and CHROMAVISION
MEDICAL SYSTEMS, INC. ("Borrower").
RECITALS
Borrower and Bank are parties to that certain Loan Agreement dated as of
February 13, 2003, as amended from time to time, including but not limited to
that certain First Amendment to Loan and Security Agreement dated as of October
21, 2003 and that certain Second Amendment to Loan and Security Agreement dated
as of January 22, 2004 (collectively, the "Agreement"). The parties desire to
amend the Agreement in accordance with the terms of this Amendment.
NOW, THEREFORE, the parties agree as follows:
1. The following defined terms in Section 1.1 of the Agreement hereby are
amended or restated as follows:
"Revolving Maturity Date" means January 31, 2006.
2. All references in the Loan Documents to Bank's address at 9920 S. La
Cienega Blvd., Suite 1401, Inglewood, CA 90301, shall mean and re fer to 2321
Rosecrans Ave., Suite 5000, El Segundo, CA 90245.
3. Section 12 of the Agreement as in effect prior to the date of this
Amendment hereby is renumbered to read "Section 13," and references to Section
12 throughout the Agreement as in effect prior to the date of this Amendment
shall mean and refer to "Section 13." New Section 12 hereby is added to the
Agreement to read as follows:
12. REFERENCE PROVISION.
The parties prefer that any dispute between them be resolved in
litigation subject to a Jury Trial Waiver as set forth in Section 11 of
this Agreement, but the availability of that process is in doubt because
of the opinion of the California Court of Appeal in Grafton Partners LP v.
Superior Court, 9 Cal.Rptr.3d 511. This Reference Provision will be
applicable until the California Supreme Court completes its review of that
case, and will continue to be applicable if either that court or a
California Court of Appeal publishes a decision holding that a pre-dispute
Jury Trial Waiver provision similar to that contained in the Loan
Documents is invalid or unenforceable. Delay in requesting appointment of
a referee pending review of any such decision, or participation in
litigation pending review, will not be deemed a waiver of this Reference
Provision.
12.1 Mechanics.
(a) Other than (i) nonjudicial foreclosure of security
interests in real or personal property, (ii) the appointment of a receiver
or (iii) the exercise of other provisional remedies (any of which may be
initiated pursuant to applicable law), any controversy, dispute or claim
(each, a "Claim") between the parties arising out of or relating to this
Agreement or any other document, instrument or agreement between the Bank
and the undersigned (collectively in this Section, the "Loan Documents"),
will be resolved by a reference proceeding in California in accordance
with the provisions of Section 638 et seq. of the California Code of Civil
Procedure ("CCP"), or their successor sections, which shall constitute the
exclusive remedy for the resolution of any Claim, including whether the
Claim is subject to the reference proceeding. Except as otherwise provided
in the Loan Documents, venue for the reference proceeding will be in the
Superior Court or Federal District Court in the County or District where
venue is otherwise appropriate under applicable law (the "Court").
(b) The referee shall be a retired Judge or Justice
selected by mutual written agreement of the parties. If the parties do not
agree, the referee shall be selected by the Presiding Judge of the Court
(or his or her representative). A request for appointment of a referee may
be heard on an ex parte or expedited basis, and the parties agree that
irreparable harm would result if ex parte relief is not granted. The
referee shall be appointed to sit with all the powers provided by law.
Each party shall have one peremptory challenge pursuant to CCP Section
170.6. Pending appointment of the referee, the Court has power to issue
temporary or provisional remedies.
(c) The parties agree that time is of the essence in
conducting the reference proceedings. Accordingly, the referee shall be
requested to (a) set the matter for a status and trial-setting conference
within fifteen (15) days after the date of selection of the referee, (b)
if practicable, try all issues of law or fact within ninety (90) days
after the date of the conference and (c) report a statement of decision
within twenty (20) days after the matter has been submitted for decision.
Any decision rendered by the referee will be final, binding and
conclusive, and judgment shall be entered pursuant to CCP Section 644.
(d) The referee will have power to expand or limit the
amount and duration of discovery. The referee may set or extend discovery
deadlines or cutoffs for good cause, including a party's failure to
provide requested discovery for any reason whatsoever. Unless otherwise
ordered, no party shall be entitled to "priority" in conducting discovery,
depositions may be taken by either party upon seven (7) days written
notice, and all other discovery shall be responded to within fifteen (15)
days after service. All disputes relating to discovery which cannot be
resolved by the parties shall be submitted to the referee whose decision
shall be final and binding.
12.2 Procedures. Except as expressly set forth in this
Agreement, the referee shall determine the manner in which the reference
proceeding is conducted including the time and place of hearings, the
order of presentation of evidence, and all other questions that arise with
respect to the course of the reference proceeding. All proceedings and
hearings conducted before the referee, except for trial, shall be
conducted without a court reporter, except that when any party so
requests, a court reporter will be used at any hearing conducted before
the referee, and the referee will be provided a courtesy copy of the
transcript. The party making such a request shall have the obligation to
arrange for and pay the court reporter. Subject to the referee's power to
award costs to the prevailing party, the parties will equally share the
cost of the referee and the court reporter at trial.
12.3 Application of Law. The referee shall be required to
determine all issues in accordance with existing case law and the
statutory laws of the State of California. The rules of evidence
applicable to proceedings at law in the State of California will be
applicable to the reference proceeding. The referee shall be empowered to
enter equitable as well as legal relief, provide all temporary or
provisional remedies, enter equitable orders that will be binding on the
parties and rule on any motion which would be authorized in a trial,
including without limitation motions for summary judgment or summary
adjudication. The referee shall issue a decision at the close of the
reference proceeding which disposes of all claims of the parties that are
the subject of the reference. The referee's decision shall be entered by
the Court as a judgment or an order in the same manner as if the action
had been tried by the Court. The parties reserve the right to appeal from
the final judgment or order or from any appealable decision or order
entered by the referee. The parties reserve the right to findings of fact,
conclusions of laws, a written statement of decision, and the right to
move for a new trial or a different judgment, which new trial, if granted,
is also to be a reference proceeding under this provision.
12.4 Repeal. If the enabling legislation which provides for
appointment of a referee is repealed (and no successor statute is
enacted), any dispute between the parties that would otherwise be
determined by reference procedure will be resolved and determined by
arbitration. The arbitration will be conducted by a retired judge or
Justice, in accordance with the California Arbitration Act Section 1280
through Section 1294.2 of the CCP as amended from time to time. The
limitations with respect to discovery set forth above shall apply to any
such arbitration proceeding.
12.5 THE PARTIES RECOGNIZE AND AGREE THAT ALL DISPUTES
RESOLVED UNDER THIS REFERENCE PROVISION WILL BE DECIDED BY A REFEREE AND
NOT BY A JURY, AND THAT THEY ARE IN EFFECT WAIVING THEIR RIGHT TO TRIAL BY
JURY IN AGREEING TO THIS REFERENCE PROVISION. AFTER CONSULTING (OR HAVING
HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE, EACH
PARTY KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL BENEFIT AGREES THAT
THIS REFERENCE PROVISION WILL APPLY TO ANY DISPUTE BETWEEN THEM WHICH
ARISES OUT OF OR IS RELATED TO THIS AGREEMENT OR THE LOAN DOCUMENTS."
4. Unless otherwise defined, all initially capitalized terms in this
Amendment shall be as defined in the Agreement. The Agreement, as amended
hereby, shall be and remain in full force and effect in accordance with its
respective terms and hereby is ratified and confirmed in all respects. Except as
expressly set forth herein, the execution, delivery, and performance of this
Amendment shall not operate as a waiver of, or as an amendment of, any right,
power, or remedy of Bank under the Agreement, as in effect prior to the date
hereof.
5. Borrower represents and warrants that the Representations and
Warranties contained in the Agreement are true and correct as of the date of
this Amendment, and that no Event of Default has occurred and is continuing.
6. As a condition to the effectiveness of this Amendment, Bank shall have
received, in form and substance satisfactory to Bank, the following:
(a) this Amendment, duly executed by Borrower;
(b) a Certificate of the Secretary of Borrower with respect to
incumbency and resolutions authorizing the execution and delivery of this
Amendment;
(c) an Affirmation of Guaranty from each Guarantor in the form
attached hereto, together with resolutions authorizing the execution and
delivery of the same;
(d) an annual renewal fee in the amount of $3,000, which shall
be due and payable and nonrefundable on the date hereof, and which may be
debited from any of Borrower's accounts;
(e) all Bank Expenses incurred through the date of this
Amendment, which shall be due and payable and nonrefundable on the date hereof,
and which may be debited from any of Borrower's accounts ; and
(f) such other documents, and completion of such other
matters, as Bank may reasonably deem necessary or appropriate.
7. This Amendment may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one instrument.
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IN WITNESS WHEREOF, the undersigned have executed this Amendment as of the
second date above written.
CHROMAVISION MEDICAL SYSTEMS, INC.
By: /s/ Stephen T. D. Dixon
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Title: Executive V.P. and CFO
COMERICA BANK
By: /s/ James Ligman
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Title: Assistant Vice President
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