EX-10.51 OVERADVANCE SIDE LETTER AGREEMENT



 





Exhibit 10.51




October 10, 2007




ProxyMed, Inc.

1854 Shackleford Ct., Suite 200

Norcross, Georgia 30093

Attention: Chief Financial Officer and General Counsel




     Re: Overadvance Side Letter



     Reference is hereby made to that certain Security and Purchase Agreement dated as of December
6, 2005 by and among Proxymed, Inc., a Florida corporation (the “Parent”), ProxyMed Transaction
Services, LLC, a Delaware limited liability company (“PTS”), PlanVista Corporation, a Delaware
corporation (“PlanVista”), Plan Vista Solutions, Inc., a New York corporation (“PVS”) and National
Network Services, LLC, a Delaware limited liability company (“NNS”, and together with the Parent,
PTS, PlanVista and PVS, the “Companies” and each, a “Company”) and Laurus Master Fund, Ltd.
(“Laurus”) (as amended, modified and/or supplemented from time to time, the “Security Agreement”).
Capitalized terms used but not defined herein shall have the meanings ascribed them in the Security
Agreement. Reference is also made to the Overadvance Side Letter, dated as of June 21, 2007 by and
among Laurus and each of the Companies (as amended, modified and/or supplemented from time to time,
the “June 2007 Overadvance Side Letter”). This Overadvance Side Letter supercedes the June 2007
Overadvance Side Letter (which is hereby terminated in its entirety and of no further force or
effect). Subject to satisfaction of the Overadvance Conditions (as defined below), Laurus is hereby
notifying the Companies of its decision to exercise the discretion granted to it pursuant to
Section 2(a)(ii) of the Security Agreement to make Loans to the Companies during the Period (as
defined below) in excess of the Formula Amount on the date hereof (the “Overadvance”). The
outstanding Overadvance shall at no time exceed, as of each date of determination the remainder of
$16,500,000 less the Formula Amount then in effect (the “Maximum Overadvance Amount”). The parties
hereto each acknowledge that the outstanding Overadvance as of the date hereof, without giving
effect to any additional borrowings as of the date hereof, is $2,795,395.32.



     In connection with making the Overadvance, for a period commencing on the date hereof through
and including December 31, 2007 (the “Period”), Laurus hereby waives compliance with Section 3 of
the Security Agreement, but solely as such provision relates to the immediate repayment requirement
for Overadvances. Laurus further agrees that solely for such Period (but not thereafter), (i) the
incurrence and existence of the Overadvance shall not trigger an Event of Default under Section
19(a) of the Security Agreement and (ii) during the Period, the rate of

















 




interest applicable to such Overadvances shall be as set forth in Section 5(b)(ii) of the
Security Agreement (collectively, the “Overadvance Rate”). Interest shall be (i) calculated on the
basis of a 360 day year, and (ii) payable monthly, in arrears, commencing on November 1, 2007 on
the first business day of each consecutive calendar month thereafter through and including the
expiration of the Period, whether by acceleration or otherwise. All other terms and provisions of
the Security Agreement and the Ancillary Agreements shall remain in full force and effect. For the
avoidance of doubt, all proceeds applied by any Company in repayment of its obligations to Laurus
hereunder and under the Security Agreement and the Ancillary Agreements shall be first applied as a
repayment of the Overadvance unless otherwise agreed by Laurus. Once repaid, the Overadvance may be
reborrowed during the Period provided that the maximum amount of the Overadvance outstanding shall
not at any time exceed the Maximum Overadvance Amount. Each Company hereby acknowledges and agrees
that all amounts outstanding under the Overadvance (together with accrued interest and fees which
remain unpaid in respect thereof) in excess of the Maximum Overadvance Amount (each, and “Excess”)
at any time shall, jointly and severally, be repaid in full by the Companies within 3 business days
of the first date of each such Excess. The failure to make any required repayment of an Overadvance
shall give rise to an immediate Event of Default.




     Each Company hereby acknowledges and agrees that Laurus’ obligation to fund the Overadvance
(and each permitted reborrowing thereof after the date hereof) up to the Maximum Overadvance Amount
then in effect shall, at the time of such making of such Overadvance or reborrowing, and
immediately after giving effect thereto, be subject to the satisfaction of the following conditions
(the “Overadvance Conditions”): (i) no Event of Default shall exist and be continuing as of such
date; (ii) all representations, warranties and covenants made by each Company in connection with
the Security Agreement and the Ancillary Agreements shall be true, correct and complete as of such
date; (iii) each Company and its Subsidiaries shall have taken all action necessary to grant Laurus
“control” over all of such Company’s and its respective Subsidiaries’ Deposit Accounts
(the “Control Accounts”), with any agreements establishing “control” to be in form and substance
satisfactory to Laurus and (iv) the Companies shall have provided to Laurus on the 1st
and 15th of each month during the Period a borrowing base certificate (each, a
“Certificate”) in the form attached hereto as Annex A, which Certificate shall be properly
completed and executed as determined by Laurus in its reasonable discretion. “Control” over such
Control Accounts shall be released upon the indefeasible repayment in full and termination of the
Overadvance (together with all accrued interest and fees which remain unpaid in respect thereof).



     Each Company hereby acknowledges and agrees that all amounts outstanding under the Overadvance
(together with accrued interest and fees which remain unpaid in respect thereof) on the date of the
expiration of the Period shall, jointly and severally, be repaid in full by the Companies on such
date of expiration.


The Companies hereby covenant and agree that, for the benefit of Laurus, (x) on or prior to October
31, 2007, the Companies shall deliver to Laurus copies of an asset purchase agreement or stock
purchase agreement (collectively “PAs”), duly authorized and
executed by each of the parties thereto (the “First PA”), which First PA shall (i) be in form and
substance satisfactory to Laurus (as determined by Laurus in its sole discretion), (ii) shall
contemplate the sale for cash only of substantial portion of the assets of the Companies in
arm-length transaction to third party





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purchaser(s)
of verifiable financial means to consummate such purchase (as determined by
Laurus in its sole discretion), (iii) upon consummation, result in the payment to
the Companies of net cash proceeds of no less than $22,000,000 (or such other amount necessary to
repay in full all Obligations owing to Laurus at such time), and (iv) require that such sale be
consummated on or prior to December 31, 2007 and (y) on or prior to November 16, 2007, the
Companies shall deliver to Laurus copies of a second asset purchase agreement, duly authorized and
executed by each of the parties thereto (the “Second PA”), which Second PA shall (i) be in form and
substance satisfactory to Laurus (as determined by Laurus in its sole discretion), (ii) shall
contemplate, collectively with the First PA, the sale for cash of all or substantially all of the
assets of the Companies in arm-length transaction(s) to third party purchaser(s) of verifiable
financial means to consummate such purchase(s) (as determined by Laurus in its sole discretion),
and (iii) require that such sale be consummated on or prior to December 31, 2007. Each Company
hereby acknowledges that the foregoing covenant shall not be deemed to be a consent by Laurus to
any sale of assets by any Company and that such consent must be separately solicited from Laurus.
For the avoidance of doubt, in the event that the Company shall fail to satisfy any of the terms and
conditions set forth herein, an Event of Default pursuant to Section 19(o) of the Security
Agreement shall automatically arise as a result thereof.



As a condition to effectiveness of this Overadvance Side Letter, the Companies shall jointly and
severally pay to Laurus, a non-refundable payment in an amount equal to $1,250,000, of which amount
(i) $1,000,000 shall be paid to Laurus on the date of effectiveness of this Overadvance Side Letter
and (ii) $250,000 shall be paid to Laurus on earlier to occur of (x) the date upon which an Event
of Default shall first occur after the date hereof, (y) the date of repayment in full of the
Revolving Note and (z) December 31, 2007. The parties hereto agree that the consideration described
above in respect of the agreements made by Laurus hereunder is hereby designated as additional
interest. The parties further agree to file all applicable tax returns in accordance with such
characterization and shall not take a position on any tax return or in any judicial or
administrative proceeding that is inconsistent with such characterization. Notwithstanding the
foregoing, nothing contained in this paragraph shall or shall be deemed to modify or impair in any
manner whatsoever each Company’s obligations from time to time owing to Laurus under the Security
Agreement and the Ancillary Agreements referred to therein.




     The Parent understands that it has an affirmative obligation to make prompt public disclosure
of material agreements and material amendments to such agreements. It is the Parent’s determination that this Overadvance
Side Letter and the related amendment dated as of the date hereof are material. The Parent agrees
to file an 8-K within 4 days of the date hereof and in the form otherwise prescribed by the SEC.



     This letter may not be amended or waived except by an instrument in writing signed by each of
the Companies and Laurus. This letter may be executed in any number of counterparts, each of which
shall be an original and all of which, when taken together, shall constitute one agreement.
Delivery of an executed signature page of this letter by
facsimile transmission shall be effective as delivery of a manually executed counterpart hereof or
thereof, as the case may be. THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK. This letter sets forth the entire



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agreement between the parties hereto as to the matters set forth herein and supersede all
prior communications, written or oral, with respect to the matters herein.




     This Overadvance Side Letter constitutes the final and complete understanding and agreement
between the parties hereto concerning Overadvances during the Period and shall be binding on, and
inure to the benefit of, the parties and their respective successors and assigns. This Overadvance
Side Letter shall for all purposes be deemed to be an Ancillary Agreement.



     If the foregoing meets with the Companies’ approval please signify the Companies’ acceptance
of the terms hereof by signing below.



	 	 	 	 	 
	 	LAURUS MASTER FUND, LTD.



By: Laurus Capital Management, LLC, its

investment manager

 	 
	 	By:  	/s/  Scott Bluestein
 	 
	 	Name:  	Scott Bluestein	 
	 	Title:  	Authorized Signatory 	 



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	 	AGREED AND ACCEPTED ON THE DATE HEREOF:





PROXYMED, INC.

 	 
	 	By:  	/s/  Peter E. Fleming	 
	 	Name:  	Peter E. Fleming, III	 
	 	Title:  	EVP & General Counsel 	 
	 
	 	PROXYMED TRANSACTION SERVICES, LLC

 	 
	 	By:  	/s/  Peter E. Fleming
 	 
	 	Name:  	Peter E. Fleming, III	 
	 	Title:  	EVP & General Counsel 	 
	 
	 	PLANVISTA CORPORATION

 	 
	 	By:  	/s/  Peter E. Fleming
 	 
	 	Name:  	Peter E. Fleming, III	 
	 	Title:  	EVP & General Counsel 	 
	 
	 	NATIONAL NETWORK SERVICES, LLC

 	 
	 	By:  	/s/  Peter E. Fleming
 	 
	 	Name:  	Peter E. Fleming, III	 
	 	Title:  	EVP & General Counsel 	 



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