Document:

Exhibit
10.46

 

 

2005
Short-term Incentive Plan Description

 

Under the Company’s short-term incentive
plan, annual cash bonuses are awarded taking into account an individual’s “target
bonus percentage” (a percentage of such participant’s base salary), individual
performance and the Company’s performance against established business and/or
financial goals (corporate payout factor). 
Each of the named executive officers is a participant in the short-term
incentive program.  For 2005, the
Compensation Committee established (i) earnings before interest, taxes,
depreciation and amortization and (ii) cash from operations less capital
expenditures as the two financial performance measures under the program, each
of which is weighted equally.  Under the
plan, a bonus equal to a multiple of the named executive officer’s target bonus
percentage will be paid depending on the level of performance achieved by the
Company with respect to the financial performance measures described above in
accordance with the following matrix:

 

	
  Performance Measure

  	
   

  	
  Corporate Payout Factor

  	
   

  
	
  EBITDA

  	
   

  	
  Cash
  from Operations less CapEx

  	
   

  	
   

  
	
  Threshold 85% of Business
  Plan

  	
   

  	
  Threshold
  55% of Business Plan

  	
   

  	
  0%

  	
   

  
	
  Target 100% of Business
  Plan

  	
   

  	
  Target
  100% of Business Plan

  	
   

  	
  100%

  	
   

  
	
  Maximum 110% of Business
  Plan

  	
   

  	
  Maximum
  135% of Business Plan

  	
   

  	
  200%

  	
   

  

 

 

The bonus factor is interpolated between
threshold and target and target and maximum based on actual performance.Exhibit
10.47

 

2005
Named Executive Officer Base Compensation

and
Short-Term Incentive Targets

 

2005 Base Salary.  The Compensation Committee approved base
salaries of the named executive officers for 2005 as follows:  M. Michele Burns, Executive Vice President,
Chief Financial Officer and Chief Restructuring Officer—$600,000; Curtis A.
Morgan, Executive Vice President and Chief Operating Officer—$500,000; Douglas
L. Miller, Senior Vice President and General Counsel—$380,000; Vance N. Booker,
Senior Vice President, Administration—$295,000; and L. Alderman Warnock, Senior
Vice President, Governmental and Regulatory Affairs—$250,000.  The Compensation Committee did not take any
action with respect to the salary of S. Marce Fuller, its Chief Executive
Officer.

 

2005 Short-term Incentive
Targets.  In addition, the Committee
approved the following short-term incentive target bonus percentages for the
named executive officers for 2005 under the short term incentive program,
expressed as a percentage of base salary: 
Ms. Burns—75%; Mr. Morgan—75%; Mr. Miller—55%; Mr. Booker—55%; Mr.
Warnock—55%.Exhibit 10.6

 

SECOND AMENDMENT

TO LOAN AND SECURITY AGREEMENT

 

This Second Amendment to Loan
and Security Agreement (this “Amendment”) is entered into as of January 22,
2004, by and between COMERICA BANK (“Bank”), and CHROMAVISION MEDICAL SYSTEMS,
INC. (“Borrower”).

 

RECITALS

 

Borrower
and Bank are parties to that certain Loan and Security 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 (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 February 28, 2005.

 

2.             Section 6.8 of the Loan Agreement hereby
is amended and restated in its entirety to read as follows:

 

“6.8         Tangible Net Worth. Borrower shall maintain, as of the last day
of each calendar month, a Tangible Net Worth of (a) at least One Dollar ($1.00)
beginning with the month ended January 31, 2004, and continuing through June 30,
2004, and (b) not less than negative Two Million Dollars (($2,000,000))
thereafter.”

 

3.             Exhibit C to the Loan Agreement hereby is
amended and replaced with Exhibit C attached hereto.

 

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 amendment 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;

 

1

 

(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.

 

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

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  EVP - CFO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  COMERICA BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Cari Pham

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Commercial Banking officer

  	
   

  
									

 

2

 

EXHIBIT C

COMPLIANCE CERTIFICATE

 

	
  TO:

  	
  COMERICA BANK

  
	
   

  	
   

  
	
  FROM:

  	
  CHROMAVISION MEDICAL
  SYSTEMS, INC.

  

 

The undersigned authorized
officer of CHROMAVISION MEDICAL SYSTEMS, INC. hereby certifies that in
accordance with the terms and conditions of the Loan Agreement between Borrower
and Bank (the “Agreement”), (i) Borrower is in complete compliance for the
period ending                      
with all required covenants except as noted below and (ii) all representations
and warranties of Borrower stated in the Agreement are true and correct in an
material respects as of the date hereof. Attached herewith are the required
documents supporting the above certification. The Officer further certifies
that these are prepared in accordance with Generally Accepted Accounting
Principles (GAAP) and are consistently applied from one ‘period to the next
except as explained in an 

accompanying letter or
footnotes.

 

Please indicate compliance status by circling Yes/No under “Complies”
column.

 

	
  Reporting Covenant

  	
   

  	
  Required

  	
   

  	
  Complies

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Monthly financial
  statements

  	
   

  	
  Monthly within 30 days

  	
   

  	
  Yes

  	
  No

  
	
  Annual (CPA Audited)

  	
   

  	
  FYE within 120 days

  	
   

  	
  Yes

  	
  No

  
	
  10K and IOQ

  	
   

  	
  (as applicable)

  	
   

  	
  Yes

  	
  No

  
	
  Total amount of Borrower’s
  cash and investments

  	
   

  	
  Amount: 
  $           

  	
   

  	
  Yes

  	
  No

  
	
  Total amount of Borrower’s cash and investments maintained with Bank

  	
   

  	
  Amount: 
  $           

  	
   

  	
  Yes

  	
  No

  

 

 

	
  Financial
  Covenant

  	
   

  	
  Required

  	
   

  	
  Actual

  	
   

  	
  Complies

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Measured
  on a Monthly Basis:

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Minimum Tangible Net Worth 

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  – 1/31/04
  to 6/30/04 

  	
   

  	
  $

  	
  1.00

  	
   

  	
  $

  	
   

  	
  Yes

  	
  No

  
	
  – 7/31/04
  and thereafter

  	
   

  	
  $

  	
  (2,000,000

  	
  )(1)

  	
  $

  	
   

  	
  Yes

  	
  No

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

(1)  TNW may not be less than negative Two Million
Dollars (($2,000,000))

 

	
  Comments Regarding
  Exceptions: See Attached

  	
   

  	
  BANK USE ONLY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Received by:

  	
   

  
	
  Sincerely,

  	
   

  	
  AUTHORIZED SIGNER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Verified:

  	
   

  
	
  SIGNATURE

  	
   

  	
   

  	
  AUTHORIZED SIGNER SIGNATURE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
	
  TITLE

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Compliance Status 

  	
  Yes

  	
  No

  
	
   

  	
   

  	
   

  
	
  DATE

  	
   

  	
   

  
									

 

3

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