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Exhibit 10(q)
FIFTH AMENDMENT
TO
LOAN AGREEMENT
THIS FIFTH AMENDMENT TO LOAN AGREEMENT (this "Agreement") is
made as of the 31st day of December, 1997, By PHARMAKINETICS
LABORATORIES, INC., a corporation organized and existing under
the laws of the State of Maryland (the "Obligor"), and
NATIONSBANK, N.A., a national banking association (formerly known
as "NationsBank, N.A. (Carolinas)" and successor by merger to
NationsBank, N.A., which was formerly known as "NationsBank of
Virginia, N.A.," NationsBank of Virginia, N.A., being the
successor by merger to NationsBank, N.A. which was formerly known
as "NationsBank of Maryland N.A." and was the successor by merger
to Maryland National Bank) (the "Bank").
RECITALS
A. The Obligor and the Bank entered into a Loan Agreement
dated May 13, 1993 (the same, as modified by First Amendment to
Loan Agreement dated May 11, 1995 (the "First Amendment"), by
Second Amendment to Loan Agreement dated July 31, 1996, by Third
Amendment to Loan Agreement dated November 30, 1996, by Fourth
Amendment to Loan Agreement dated August 1, 1997, and as amended,
modified, substituted, extended, and renewed from time to time,
the "Loan Agreement"). The Loan Agreement provides for some of
the agreements between the Obligor and the Bank with respect to
the "Loans" (as defined in the Loan Agreement), including
revolving credit facility in an amount not to exceed $500,000 and
term facilities in an original principal amount of $2,400,000.
B. The Obligor has requested that the Bank extend the
Revolving Credit Termination Date (as that is defined in the Loan
Agreement) and, upon funding of the Borrower's issuance of
convertible preferred stock in an amount of not less than
$5,000,000, drop the requirement that advances evidenced by the
Revolving Credit Note (as that term is defined in the Financing
Agreement) by secured by cash collateral.
C. The Bank is willing to agree to the Obligor's requests
on the condition, among others, that this Agreement be executed.
AGREEMENTS
NOW, THEREFORE, in consideration of the premises and for
other good and valuable consideration, receipt of which is hereby
acknowledged, the Obligor and the Bank agree as follows:
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1. The Obligor and the Bank agree that the Recitals above
are a part of this Agreement. Unless otherwise expressly defined
in this Agreement, terms defined in the Loan Agreement shall have
the same meaning under this Agreement.
2. The Obligor and the Bank agree that on the date hereof
the aggregate outstanding principal balance under the Revolving
Credit Note (subject to change for returned items and other
adjustments made in the ordinary course of business) is $ 0. The
Obligor agrees that the Bank shall not be obligated to make any
further advances under the Revolving Credit Note unless all
obligations with respect thereto are fully secured by a
perfected, unavoidable, first lien pledge of cash deposits held
by the Bank; provided, however, upon funding of the Borrower's
issuance of convertible preferred stock in an amount of not less
that $5,000,000, no later than December 31, 1997, the Bank shall
no longer require such a pledge.
3. The section "The Revolving Loan" (which section was
added in the First Amendment) is hereby amended by changing the
Revolving Credit Termination Date from November 30, 1997 to
November 30, 1998. The Borrower and the Lender shall execute and
deliver a Third Commercial Promissory Note Modification Agreement
(the "Third Revolving Credit Note Amendment") at the time this
Agreement is executed and delivered which reflects that change.
4. It is a condition of the Bank's agreements under this
Agreement, under the Third Revolving Credit Note Amendment and
under the Third Note Modification dated the same date as this
Agreement (the "Third Term Note Modification") that Maryland
Industrial Development Financing Authority in writing consent to
the execution and delivery of the Third Revolving Credit Note
Amendment, the Third Term Note Modification and this Agreement .
5. The Obligor hereby issues, ratifies and confirms the
representations, warranties and covenants contained in the Loan
Agreement, as amended hereby. The Obligor agrees that this
Agreement is not intended to and shall not cause a novation with
respect to any or all of the Obligations.
6. The Obligor acknowledges and warrants that the Bank has
acted in good faith and has conducted in a commercially
reasonable manner its relationships with the Obligor in
connection with this Agreement and generally in connection with
the Loan Agreement and the Obligations, the Obligor hereby
waiving and releasing any claims to the contrary.
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7. This Agreement may be executed in any number of
duplicate originals or counterparts, each of such duplicate
originals or counterparts shall be deemed to be an original and
all taken together shall constitute but one and the same
instrument. The Obligor agrees that the Bank may rely on a
telecopy of any signature of any Obligor. The Bank agrees that
the Obligor may rely on a telecopy of this Agreement executed by
the Bank.
IN WITNESS WHEREOF, the Obligor and the Bank have executed
this Agreement under seal as of the date and year first written
above.
WITNESS or ATTEST: PHARMAKINETICS LABORATORIES, INC.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and
Chief Executive Officer
WITNESS: NATIONSBANK, N.A.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ (SEAL)
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Vice President
AGREEMENT OF GUARANTOR
The undersigned is the "Guarantor" under a Guaranty of
Payment Agreement, dated May 13, 1993 (as amended, modified,
substituted, extended and renewed from time to time, the
"Guaranty"), in favor of the foregoing Bank. In order to induce
the Bank to enter into the foregoing Agreement, the undersigned
(a) consents to the transactions contemplated by, and agreements
made by the Obligor under, the foregoing Agreement, and (b)
ratifies, confirms and reissues the terms, conditions, promises,
covenants, grants, assignments, security agreements, agreements,
representations, warranties and provisions contained in the
Guaranty. Without limiting the foregoing, the undersigned
acknowledges and agrees that the Obligations (defined in the Loan
Agreement) include, without limitation, the amendments described
in the foregoing Agreement and that the Obligations are covered
by the Guaranty.
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WITNESS signature and seal of the undersigned as of the date
of the Agreement.
WITNESS: PKLB LIMITED PARTNERSHIP
By: PharmaKinetics Laboratories, Inc.
General Partner
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (SEAL)
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and
Chief Executive Officer
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