EXHIBIT 10.1
AMENDMENT TO LOAN AGREEMENT
This Amendment to Loan Agreement (this "Amendment") is entered into as
of September 7, 2004 (the "Effective Date") by and between Digirad Corporation,
a Delaware corporation (the "Company") and the Gerald G. Loehr Separate Property
Trust ("Holder").
RECITALS
WHEREAS, the Company and Holder are party to a certain Loan Agreement
dated on or about September 1, 1993, as amended on or about January 1, 1994,
February 17, 1994, April 14, 1994 and May 13, 1994 (collectively, the "Loan
Agreement");
WHEREAS, in connection with the consummation of the sale by the Company
of certain shares of its common stock to the public (the "Public Offering")
pursuant a Registration Statement on Form S-1 (the "Registration Statement"),
under the Securities Act of 1933, as amended, the Company and Holder have
entered into a certain Loan Modification and Warrant Issuance Agreement dated as
of the date hereof (the "Loan Modification Agreement"), pursuant to which the
Company and Holder have set forth their agreements and understandings with
respect to certain matters and have agreed to settle any potential disagreements
among them in connection therewith; and
WHEREAS, in connection with the transactions contemplated by the Loan
Modification Agreement, and acting pursuant to Section 1 of the Loan Agreement,
the Company and Holder desire to amend and restate certain provisions of the
Loan Agreement.
In consideration of the foregoing and the promises and covenants
contained herein and other good and valuable consideration the receipt of which
is hereby acknowledged, the parties hereto agree as follows:
1. PAYMENT OF PRINCIPAL. Section 1.2 of the Loan Agreement shall be
amended and restated in its entirety as follows:
"1.2 Payment of principal shall not become due until the later
of (i) March 31, 1999 or (ii) March 31 of the year immediately
following the first year in which the Company's cash provided
by operations is greater than zero as shown on the Company's
audited statement of cash flows for such year. Subject to
certain exceptions to payment provided herein, the principal
shall be paid to Lender in twelve (12) equal quarterly
installments, the first such payment to be made within
forty-five (45) days of the initial due date and subsequent
quarterly installments to be paid within forty-five (45) days
of the end of each subsequent quarter. The Company shall make
payment of quarterly installments to Lender in equal
proportion to the amounts paid to the other Founders, and
shall not make payment of any portion of Lender's principal
before similar payment to other Founders. Notwithstanding the
foregoing, following the consummation by the Company of the
initial sale of its common stock to the public in a firm
commitment, underwritten public offering pursuant a
Registration Statement on Form S-1 under the Securities Act of
1933, as amended (an "IPO"), the Company shall pay to Lender
within ten (10) business days of August 9, 2004, the remaining
principal amount outstanding under this agreement."
2. EFFECT OF AMENDMENT. Except as expressly amended, restated or
consented to in this Amendment, the Loan Agreement shall continue in full force
and effect. In the event of any conflict between the terms of this Amendment and
Loan Agreement, the terms of this Amendment shall govern and control.
3. REPRESENTATIONS OF HOLDER. Holder represents and warrants to the
Company that it is the sole record and beneficial owner of the indebtedness
represented by the Loan Agreement and that no other person or entity has any
interest in such indebtedness. Holder further represents and warrants that this
Amendment constitutes a legal, valid and binding obligation of Holder and Holder
has full right, power and authority to execute, deliver and perform this
Amendment.
4. GOVERNING LAW. This Amendment shall be governed by and construed
under the laws of the State of California as applied to agreements among
California residents entered into and to be performed entirely within
California.
5. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
6. SEVERABILITY. If one or more provisions of this Amendment is held to
be unenforceable under applicable law, such provision shall be excluded from
this Amendment and the balance of the Amendment shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
7. ENTIRE AGREEMENT. This Amendment, together with the Loan Agreement,
the Loan Modification Agreement and the documents executed in connection
therewith, constitutes the full and entire understanding and agreement between
the parties with regard to the subjects hereof and thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
2
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first above written.
COMPANY: DIGIRAD CORPORATION
/S/ DAVID M. SHEEHAN
David M. Sheehan
President and Chief Executive Officer
HOLDER: GERALD G. LOEHR SEPARATE PROPERTY TRUST
By: Whittier Trust Company
Its: Co-Trustee
By: /S/ PAMELA D. BARKER
-----------------------------------
Name: Pamela D. Barker
Its: Vice President
By: /S/ WILLIAM C. JOHNSON
-----------------------------------
William C. Johnson
Co-Trustee
[SIGNATURE PAGE TO AMENDMENT TO LOAN AGREEMENT]