NINTH AMENDMENT
TO


SECOND AMENDED AND RESTATED
CREDIT AGREEMENT





THIS
NINTH AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT (this “Ninth Amendment”),
executed as of May 31, 2010, is by and between BIRNER DENTAL MANAGEMENT SERVICES,
INC., a Colorado corporation (“Borrower”), and KEYBANK NATIONAL ASSOCIATION,
a national banking association (“Lender”).





RECITALS





A.Borrower
and Lender are parties to a Second Amended and Restated Credit Agreement, dated
as of August 7, 2003 (the “Credit Agreement”),
pursuant to which Lender has agreed to make loans up to $7,000,000 to Borrower
on the terms and subject to the conditions set forth therein. The Credit
Agreement was amended by the terms of that certain First Amendment to Second
Amended and Restated Credit Agreement dated May 6, 2004, that certain Second
Amendment to Second Amended and Restated Credit Agreement dated April 29, 2005,
that certain Third Amendment to Second Amended and Restated Credit Agreement
dated April 25, 2006, that certain Fourth Amendment to Second Amended and
Restated Credit Agreement dated August 31, 2006, that certain Fifth Amendment to
Second Amended and Restated Credit Agreement dated April 30, 2007, that certain
Sixth Amendment to Second Amended and Restated Credit Agreement dated April 22,
2008, that certain Seventh Amendment to Second Amended and Restated Credit
Agreement dated June 30, 2009, and that certain Eighth Amendment to Second
Amended and Restated Credit Agreement dated January 13, 2010.





B.           Borrower
desires to further modify certain terms and conditions of the Credit Agreement,
and Lender is willing to agree to the modifications contained in this Ninth
Amendment, on the terms and conditions set forth herein.





C.           Capitalized
terms used in this Ninth Amendment and not defined herein shall have the
meanings assigned to those terms in the Credit Agreement.





NOW,
THEREFORE, in consideration of the foregoing premises and other good and
valuable consideration, the receipt, adequacy and sufficiency of which are
hereby acknowledged, the parties hereto covenant and agree as
follows:





1.           AMENDMENTS TO CREDIT
AGREEMENT. The Credit Agreement is hereby amended as
follows:





(a)          Extension of Maturity
Date. The definition of “Revolving Credit Maturity Date” contained in
Section 1.1 of the Credit Agreement is hereby amended and restated to read in
its entirety as follows:





“Revolving Credit Maturity
Date” shall mean May 31, 2012.








(b)         Deletion of L1BOR Rate
Floor. The definition of “L1BOR Rate” contained in Section 1.1 of the
Credit Agreement is hereby amended and restated to read in its entirety as
follows:





“L1BOR Rate” shall
mean for each Interest Period for any L1BOR Rate Loan, the average rate as
established by the British Bankers Association (“BBA”) on the first
day of such Interest Period, based on the average of the rates charged by eight
(excluding the four highest and the four lowest rates) of the sixteen largest
British Banks in London. If the BBA no longer reports such rate or Lender
determines in good faith that the rate so reported no longer accurately reflects
the rate available to Lender in the London Interbank Market, Lender may select
in its reasonable discretion a replacement index for determining L1BOR, and
shall promptly notify Borrower of such selection. If there are changes in the
L1BOR Reserve Requirement, L1BOR shall be adjusted by dividing L1BOR by the
result of (x) 1.00 minus (y) the L1BOR Reserve Requirement.





(c)  
       Modification of Interest
Rate Margin. Section 2.6(a) of the Credit Agreement is hereby amended and
restated to read in its entirety as follows:





“(a)





(i) With
respect to any L1BOR Rate Loan, at a rate per annum equal to the sum of the
L1BOR Rate effective as of the date such LIBOR Rate Loan was made and the L1BOR
Rate Margin specified in subpart (a)(iii) below.





(ii) With
respect to any Base Rate Loan, at a rate per annum equal to the sum of the Base
Rate and the Base Rate Margin specified in subpart (a)(iii) below, which rate
shall change when and as the Base Rate changes in accordance with this
Agreement.





(iii) The
LIBOR Rate Margin or Base Rate Margin, as applicable, shall be equal to the
margin set forth in the table below with respect to Revolving Loans or Term
Loan, as applicable:





L1BOR Rate Margin
                
                Base Rate MarginRevolving
      Loans
                
                250
      Basis Points
                
                25
      Basis PointsTerm
      Loan
                
                150
      Basis Points
                
                0
      Basis Points”





(d) 
 Modification of
the Commitment Fee. Section 2.5(b) of the Credit Agreement is hereby
amended and restated to read in its entirety as follows:


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“(b) A
commitment fee (the “Commitment Fee”) of
0.40% per annum prior to June 1, 2010, and 0.25% per annum on June 1, 2010
and thereafter, on the average daily unused amount of the Revolving Loan
Commitment during the preceding quarter shall be payable, in arrears, on the
last day of each quarter and on the Revolving Credit Maturity Date. The
Commitment Fee shall be computed on the basis of the actual number of days
elapsed in a year of 360 days. The Commitment Fee due and payable on June
30, 2010 shall be prorated based on the number of days from the beginning
of the quarter through and including May 31, 2010 at the 0.40% rate and
from June 1, 2010 through the end of quarter at the 0.25% rate. The
Commitment Fee shall be paid on the dates due, in immediately available
funds. Once paid, the Commitment Fee shall not be refundable under any
circumstances.”





2.           LOAN DOCUMENT
AMENDMENTS. Each of the other Loan Documents is hereby amended
to conform to the amendments to the Credit Agreement as set forth in
Paragraph 1.





3.           DOCUMENT
RATIFICATION. Subject to the amendments set forth in Paragraph 1 above,
all of the terms and conditions contained in the Credit Agreement and the
other Loan Documents shall remain unmodified and in full force and
effect.





4.           RELEASE. The
execution of this Ninth Amendment by Lender does not and shall not constitute a
waiver of any rights or remedies to which Lender is entitled pursuant to the
Credit Agreement or the other Loan Documents, nor shall the same constitute a
waiver of any default now existing or which may occur in the future with respect
to the Credit Agreement or the other Loan Documents. Borrower hereby agrees that
Lender has fully performed its obligations pursuant to the Credit Agreement and
the other Loan Documents through the date hereof and hereby waives, releases and
relinquishes any and all claims whatsoever, known or unknown, that it may have
against Lender with respect to the Credit Agreement or the other Loan Documents
through the date hereof.





5.           PAYMENT OF COSTS AND
FEES. Borrower shall pay all out-of-pocket expenses incurred by Lender in
connection with the preparation of this Ninth Amendment, including, without
limitation, reasonable attorneys’ fees.





6.           CONDITIONS PRECEDENT.
Notwithstanding anything to the contrary set forth herein, the terms and
provisions of this Ninth Amendment shall not be effective unless and until all
of the following shall have occurred:





(a)          
Borrower shall have executed and delivered to Lender this Ninth Amendment, and
such other documents, instruments, resolutions and other items as may be
required by Lender, in form satisfactory to Lender.





(b)          
Borrower shall have paid to Lender a fully earned, non-refundable fee of $17,500
to induce Lender to enter into this Ninth Amendment.


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7.           REPRESENTATIONS, WARRANTIES
AND COVENANTS OF BORROWER. Borrower
represents, warrants and covenants to Lender:





(a)          
No default or event of default under any of the Loan Documents as modified
herein, nor any event, that, with the giving of notice or the passage of time or
both, would be a default or an event of default under the Loan Documents as
modified herein has occurred and is continuing.





(b)          
There has been no material adverse change in the financial condition of Borrower
or any other person whose financial statement has been delivered to Lender in
connection with the Loan from the most recent financial statement received by
Lender.





(c)          
Each and all representations and warranties of Borrower in the Loan Documents
are accurate on the date hereof.





(d)          
Borrower has no claims, counterclaims, defenses, or set-offs with respect to the
Loan or the Loan Documents as modified herein.





(e)          
The Loan Documents as modified herein are the legal, valid, and binding
obligation of Borrower, enforceable against Borrower in accordance with their
terms.





(f)          
Borrower shall execute, deliver, and provide to Lender such additional
agreements, documents, and instruments as reasonably required by Lender to
effectuate the intent of this Ninth Amendment.





8.           CONTROLLING LAW. The
terms and provisions of this Ninth Amendment shall be construed in accordance
with and governed by the laws of the State of Colorado.





9.           BINDING EFFECT. This
Ninth Amendment shall be binding upon and inure to the benefit of the parties
hereto, their successors and assigns.





10.         CAPTIONS. The
paragraph captions utilized herein are in no way intended to interpret or limit
the terms and conditions hereof, rather, they are intended for purposes of
convenience only.





11.         COUNTERPARTS. This
Ninth Amendment may be executed in any number of counterparts, each of which
shall be effective only upon delivery and thereafter shall be deemed an
original, and all of which shall be taken to be one and the same instrument, for
the same effect as if all parties hereto had signed the same signature page. Any
signature page of this Ninth Amendment may be detached from any counterpart of
this Ninth Amendment without impairing the legal effect of any signatures
thereon and may be attached to another counterpart of this Ninth Amendment
identical in form hereto but having attached to it one or more additional
signature pages.





[Signatures
appear on following page]


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[SIGNATURE
PAGE TO NINTH AMENDMENT TO


SECOND
AMENDED AND RESTATED CREDIT AGREEMENT]





IN
WITNESS WHEREOF, the parties hereto have executed this Ninth Amendment as of the
day and year first above written.





BORROWER:BIRNER
      DENTAL MANAGEMENT SERVICES,INC.,
      a Colorado corporationBy:
                    /s/
      Dennis GentyDennis
      Genty, Chief Financial OfficerLENDER:KEY
      BANK NATIONAL ASSOCIATION, anational
      banking associationBy:
                    /s/
      Timothy BishopTimothy
      Bishop, Vice
President


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