Document:

Exhibit 10.6

 

THE TERMS AND CONDITIONS SET FORTH IN THIS PATENT
SECURITY AGREEMENT ARE SUBJECT TO THE TERMS AND CONDITIONS SET FORTH IN THAT
CERTAIN SUBORDINATION AND INTERCREDITOR AGREEMENT DATED AS OF THE DATE HEREOF
BY AND AMONG COMVEST INVESTMENT PARTNERS II LLC, HADDOCK, INC. AND FLOUNDER
CORPORATION.

 

PATENT SECURITY AGREEMENT

 

AGREEMENT dated as of June 22, 2005 made by Fischer
Imaging Corporation, a Delaware corporation (“Borrower”), in favor of Hologic,
Inc., a Delaware corporation, and its successors, assigns, and other legal representatives
(“Secured Party”).

 

W I  T
N  E  S  S  E  T  H:

 

WHEREAS, Borrower and Secured Party are parties to a
Loan Agreement, dated as of June 22, 2005 (the “Loan Agreement”), and certain
agreements, documents and instruments entered into pursuant thereto, (together
with the Loan Agreement and this Patent Security Agreement, the “Loan Documents”),
pursuant to which Secured Party has agreed to make a certain loan to Borrower;

 

WHEREAS, Secured Party’s willingness to enter into the
Loan Documents and make such loan available thereunder is subject to the
condition, among others, that Borrower execute and deliver this Patent Security
Agreement;

 

NOW, THEREFORE, in consideration of the premises and
for one dollar ($1.00) and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, and in addition to, and not
in limitation of, any rights of the Secured Party under the other Loan
Documents, Borrower hereby agrees for the benefit of Secured Party as follows:

 

1.             DEFINITIONS.

 

1.1           Capitalized
terms used but not defined herein shall have the meanings ascribed to them in
the Loan Agreement.

 

1.2           “PTO”
shall mean the United States Patent and Trademark Office.

 

1.3           “Patents”
shall mean all of the following now or hereafter owned by the Borrower:

 

(a)           all
letters patent of the United States or any other country, and all applications
for letters patent of the United States or any other country;

 

1

 

(b)           all
re-issues, continuations, divisions, continuations-in-part, renewals or
extensions thereof;

 

(c)           the
inventions disclosed or claimed therein, including the right to make, use,
practice and/or sell (or license or otherwise transfer or dispose of) the inventions
disclosed or claimed therein; and

 

(d)           the right
(but not the obligation) to make and prosecute applications for such Patents.

 

Patents shall include but not be limited to those set
forth on Schedule A attached hereto.

 

1.4           “Patent
Collateral” shall mean all of the Borrower’s right, title and interest in
and to all of the Patents, the Patent License Rights, and the Patent Rights,
and all additions, improvements, and accessions to, all substitutions for and
replacements of, and all products and Proceeds (including insurance proceeds)
of any and all of the foregoing, and all books and records and technical
information and data describing or used in connection with any and all such
rights, interests, assets or property.

 

1.5           “Patent
License Rights” shall mean any and all past, present or future rights and
interests of the Borrower pursuant to any and all past, present and future
licensing agreements in favor of the Borrower, or to which the Borrower is a
party, pertaining to any Patents or Patent Rights, owned or used by third
parties in the past, present or future, including the right to enforce, sue and
recover for, any past, present or future breach or violation of any such
agreements but only to the extent that the inclusion thereof in this Agreement
does not and will not cause a default under the terms of any agreement (except
that all payment rights of Borrower shall be included in this Agreement).

 

1.6           “Patent
Rights” shall mean any and all past, present or future rights in, to and
associated with the Patents throughout the world, whether arising under federal
law, state law, common law, foreign law, or otherwise, including but not
limited to the following: all such rights arising out of or associated with the
Patents; the right (but not the obligation) to register claims under any federal,
state or foreign patent law or regulation; the right (but not the obligation)
to sue or bring opposition or bring cancellation proceedings for any and all
past, present and future infringements of or any other damages or injury to the
Patents or the Patent Rights, and the rights to damages or profits due or
accrued arising out of or in connection with any such past, present or future
infringement, damage or injury; and the Patent License Rights.

 

1.7           “Proceeds”
shall mean any consideration received from the sale, exchange, license, lease
or other disposition or transfer of any right, interest, asset or property
which constitutes Patent Collateral, any value received as a consequence of the
ownership, possession, use or practice of any Patent Collateral, and any
payment received from any insurer or other person or entity as a result of the
destruction or the loss, theft or other involuntary conversion, of whatever
nature, of any right, interest, asset or property which constitutes Patent
Collateral.

 

2

 

2.             GRANT
OF SECURITY; COLLATERAL ASSIGNMENT.

 

2.1           Grant
of Security Interest.  As collateral
security for the complete and timely performance and satisfaction of all
Obligations (as defined in the Security Agreement from Borrower to Secured
Party dated as of even date hereof (“Security Agreement”)), the Borrower hereby
unconditionally grants to Secured Party, a continuing security interest in and
lien on the Patent Collateral, and pledges, mortgages and hypothecates the
Patent Collateral to Secured Party.

 

2.2           Supplemental
to Loan Documents.  The parties
expressly acknowledge and agree that they have executed and delivered the Loan
Documents pursuant to which the Borrower unconditionally granted to Secured
Party, a continuing security interest in and lien on the Collateral (as defined
in the Security Agreement) (including the Patent Collateral).  In no event shall this Patent Security
Agreement, or the recordation of this Patent Security Agreement (or any
document hereunder) with the PTO, or any other governmental or public office or
agency, adversely affect or impair, in any way or to any extent, the other Loan
Documents, the security interest of Secured Party in the Collateral (including
the Patent Collateral) pursuant to the other Loan Documents, the attachment and
perfection of such security interest under the UCC (as defined in the Security
Agreement), or the present or future rights and interests of Secured Party in
and to the Collateral under or in connection with this Patent Security
Agreement, the other Loan Documents, and/or the UCC.  Any and all rights and interests of Secured
Party in and to the Patent Collateral (and any and all obligations of the
Borrower with respect to the Patent Collateral) provided herein, or arising
hereunder or in connection herewith, shall only supplement and be cumulative
and in addition to the rights and interests of Secured Party (and the
obligations of the Borrower) in, to or with respect to the Collateral
(including the Patent Collateral) provided in or arising under or in connection
with the other Loan Documents.

 

3.             REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE BORROWER. 
The Borrower represents and warrants to, and covenants and agrees with,
Secured Party, as follows:

 

3.1           Title.
The Borrower will, subject to its reasonable business judgment, take all
actions as it shall determine to defend its right, title and interests in and
to the Patents and the Patent Collateral against claims of any third parties.

 

3.2           Maintenance
of Patent Collateral.  The Borrower
shall take such actions (including but not limited to institution and
maintenance of suits, proceedings or actions) it determines to be appropriate
to maintain, protect, preserve, care for and enforce the Patent Collateral.

 

3.3           No
Infringements. The Borrower shall use reasonable efforts consistent with
past practices to protect against any infringement or unauthorized or improper
use of the Patents.  In the event any
such infringement or unauthorized or improper use by any third party has been
reasonably established by the Borrower, the Borrower shall promptly notify
Secured Party.

 

3

 

3.4           Recording
at the PTO.  Borrower acknowledges
that Secured Party may cause this Patent Security Agreement to be recorded with
the PTO.

 

4.             REMEDIES
UPON AN EVENT OF DEFAULT.  During the
continuance of an Event of Default:

 

(a)           Secured
Party may declare all Obligations secured hereby immediately due and payable
and shall have all of the rights and remedies of a secured party under the UCC
as now in effect in the Commonwealth of Massachusetts or under other applicable
law.

 

(b)           Secured
Party may notify any obligors with respect to the Patent Collateral of Secured
Party’s security interest and that such obligors are to make payments directly
to Secured Party.  Secured Party may send
this notice in Borrower’s name or in Secured Party’s name, and at Secured Party’s
request Borrower will join in Secured Party’s notice, provide written
confirmation of Secured Party’s security interest and request that payment be
sent to Secured Party.  Secured Party may
enforce this obligation by specific performance.  Secured Party may collect all amounts due
from such obligors.  Upon and after
notification by Secured Party to Borrower, Borrower shall hold any proceeds and
collections of any of the Patent Collateral in trust for Secured Party and
shall not commingle such proceeds or collections with any other of Borrower’s
funds, and Borrower shall deliver all such proceeds to Secured Party
immediately upon Borrower’s receipt thereof in the identical form received and
duly endorsed or assigned to Secured Party.

 

(c)           Secured
Party will give to the Borrower reasonable notice of the time and place of any
public sale of Patent Collateral or of the time after which any private sale or
other intended disposition thereof is to be made.  Such requirement of reasonable notice shall
be met if such notice is delivered to the address of the Borrower set forth in
this Patent Security Agreement at least ten (10) days before the time of the
proposed sale or disposition.  Any such
sale may take place from Borrower’s location or such other location as Secured
Party may designate.  Borrower shall
remain liable for any deficiency in payment of the Obligations after any such
sale.

 

(d)           No
Obligation of Secured Party.  Nothing
herein shall be construed as obligating Secured Party to take any of the
foregoing actions at any time.

 

5.             LIABILITIES,
INDEMNITY AND COSTS.

 

5.1           Liability
for Uses of Patent Collateral.  The
Borrower shall be liable for any and all uses or misuses of and the practice,
manufacture, sales (or other transfers or dispositions) of any of the Patent
Collateral by the Borrower and its affiliates. 
The Borrower shall also be exclusively liable for any claim, suit, loss,
damage, expense or liability arising out of or in connection with the fault,
negligence, acts or omissions of the Borrower (regardless of whether such
fault, negligence, acts or omissions occurred or occur prior to or after the
applicable license termination).

 

4

 

5.2           License
Agreement Obligations.  Nothing in
this Patent Security Agreement shall relieve the Borrower from any performance
of any covenant, agreement or obligation of the Borrower under any license
agreement now or hereafter in effect licensing any part of the Patent
Collateral, or from any liability to any licensee or licensor under any such
license agreement or to any other party, or shall impose any liability on
Secured Party for any act or omission of the Borrower in connection with any
such license agreement.

 

6.             POWER
OF ATTORNEY.  The provisions of this
Section 6 shall be subject in all events to the terms and conditions of the
Loan Agreement.

 

6.1           Grant.  The Borrower hereby grants to Secured Party,
and any officer or agent of Secured Party as Secured Party may designate in its
sole discretion, a power of attorney, thereby constituting and appointing
Secured Party (and Secured Party’s designee) its true and lawful attorney-in-law
and attorney-in-fact, effective upon the occurrence and during the continuation
of an Event of Default, for the purpose of assigning, selling, licensing or
otherwise transferring or disposing of all right, title and interest of the
Borrower in and to any of the Patent Collateral in accordance with the terms
hereof.  The Borrower hereby ratifies all
that such attorney shall lawfully do or cause to be done by virtue hereof.

 

6.2           Irrevocable.  The foregoing power of attorney is coupled
with an interest and is irrevocable until this Patent Security Agreement is
terminated.

 

7.             GENERAL
PROVISIONS.

 

7.1           Loan
Agreement Controls.  This Patent
Security Agreement is supplemental to the Security Agreement and the Loan
Agreement (the terms of which, including, without limitation, the notice and
governing law provisions and no waiver provisions, the Borrower expressly
accepts, confirms and acknowledges are incorporated herein by reference).  In the event of any irreconcilable conflict
between the provisions of this Patent Security Agreement and the Loan Agreement
or the Security Agreement the provisions most advantageous to Secured Party and
most restrictive to Borrower shall control.

 

7.2           Specific
Enforcement.  Due to the unique
nature of the Patent Collateral, and in order to preserve its value, the
Borrower agrees that the Borrower’s agreements, duties and obligations under
this Patent Security Agreement shall be subject to specific enforcement and other
appropriate equitable orders and remedies.

 

REMAINDER OF PAGE LEFT
INTENTIONALLY BLANK

 

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IN WITNESS WHEREOF, Borrower has caused this Patent
Security Agreement to be executed by its duly authorized officer as of the date
first written above.

 

 

	
  WITNESS:

  	
  FISCHER IMAGING CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Harris Ravine

  	
   

  
	
   

  	
   

  	
   Name:

  	
  Harris Ravine

  	
   

  
	
   

  	
   

  	
   Title:

  	
  President and Chief Executive Officer

  	
   

  
							

 

 

	
  STATE: Colorado

  	
   

  	
   

  
	
  COUNTY: Denver

  	
   

  	
  June 22, 2005

  

 

Then personally appeared the above-named Harris Ravine
and stated that he is a duly authorized Officer of Flounder Corporation (the “Corporation”)
and acknowledged the foregoing instrument to be his free act and deed, and the
free act and deed of said Corporation, before me,

 

 

	
   

  	
  /s/ Marilyn R. Moll

  	
   

  
	
   

  	
  Notary Public

  
	
   

  	
  My Commission Expires: November 12, 2005

  

 

6Exhibit 10.7

 

SUBORDINATION AND INTERCREDITOR
AGREEMENT

 

AGREEMENT (this “Agreement”),
made and entered into this        day of June,
2005, by and among COMVEST INVESTMENT
PARTNERS II LLC, a Delaware limited liability company (the “Senior
Creditor”), HOLOGIC, INC., a
Delaware corporation (the “Junior Creditor”), and FISCHER IMAGING CORPORATION, a Delaware corporation (the “Company”);

 

W  I  T
N  E  S  S  E  T  H:

 

WHEREAS, the Senior Creditor and
the Company are parties to a Note and Warrant Purchase Agreement dated as of
February 22, 2005 (as amended, the “Senior Loan Agreement”), pursuant to which,
among other things, (a) the Senior Creditor has made loans to the Company in
the aggregate outstanding principal amount of $7,000,000, which loans are
represented by (i) a Senior Secured Promissory Note (Replacement Note) of the
Company dated February 22, 2005 in the principal amount of $5,000,000, and (ii)
a Senior Secured Promissory Note of the Company dated March 30, 2005 in the
principal amount of $2,000,000 (each a “Senior Note” and collectively the “Senior
Notes”), and (b) the Senior Creditor may hereafter purchase additional senior
secured promissory notes from the Company, which may be evidenced by one or
more additional senior secured promissory notes of the Company (the “Additional
Notes”); and

 

WHEREAS,
the obligations of the Company to the Senior Lender under or pursuant to the
Senior Loan Agreement, the Senior Notes, any Additional Notes and the other
Senior Loan Documents (as such term is hereinafter defined), whether now
existing or hereafter arising, are secured by substantially all of the assets
of the Company, pursuant to the Security Agreement dated as of February 22,
2005 by the Company in favor of the Senior Lender and certain financing
statements, collateral assignments and related documents (collectively, the “Senior
Security Documents”) under and pursuant to the Senior Loan Agreement; and

 

WHEREAS,
on or about the date hereof, the Junior Creditor proposes to make a
subordinated loan to the Company in the principal amount of $5,000,000 pursuant
to a Loan Agreement of even date herewith by and between the Junior Creditor
and the Company (the “Junior Loan Agreement”), which loan is evidenced by a
Promissory Note of the Company of even date herewith in the principal amount of
$5,000,000 (the “Junior Note”); and

 

WHEREAS,
the obligations of the Company to the Junior Creditor under the Junior Loan
Agreement, the Junior Note and the other Junior Loan Documents (as such term is
hereinafter defined) are secured by substantially all of the assets of the
Company, pursuant to a Security Agreement, a Patent Security Agreement, and a
Trademark Security Agreement, each of even date herewith and certain financing
statements, collateral assignments and related documents (collectively, the “Junior
Security Documents”) under and pursuant to the Junior Loan Agreement;

 

1

 

WHEREAS,
the Senior Creditor and the Junior Creditor wish to confirm their agreements
and understandings with respect to the relative priorities of their respective
claims and liens against the Company and its assets, as more particularly set
forth herein;

 

NOW,
THEREFORE, in consideration of the premises and the mutual
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereby
agree as follows:

 

1.             Definitions.  In addition to those terms defined elsewhere
in this Agreement, the following terms shall have the following meanings
wherever used in this Agreement:

 

“Asset Purchase
Agreement” means the Asset Purchase Agreement of even date herewith between the
Company and the Junior Creditor, as in effect on the date hereof.

 

“Code” means the
United States Bankruptcy Code as in effect from time to time.

 

“Junior Debt” means all obligations existing, arising
under or pursuant to the Junior Loan Documents, as same may be amended,
extended or otherwise modified from time to time; provided, however,
that for avoidance of doubt, the Junior Debt shall not include any monetary
obligations of the Company pursuant to Section 7.3 of the Asset Purchase
Agreement so long as such obligations are not secured by any collateral.

 

“Junior Liens” means all liens, security interests,
pledges and other encumbrances of any kind, in, to or in respect of any assets
or properties of the Company, held from time to time by the holder or holders
of Junior Debt as collateral security for the payment and/or performance of
Junior Debt, including but not limited to those liens, security interests and
other encumbrances created and/or evidenced by the Junior Security Documents.

 

“Junior Loan
Documents” means the Junior Loan Agreement, the Junior Note, the Junior
Security Documents, and any and all other agreements or instruments executed
and delivered pursuant thereto or in respect thereof.

 

“Permitted
Payments” means scheduled payments of principal, accrued interest and any
attorneys’ fees under the Junior Note as and when same become due and payable
on the scheduled payment dates set forth in the Junior Note.

 

“Senior Debt” means all loans, indebtedness,
liabilities and other obligations of any kind owing by the Company under any or
all of the Senior Loan Documents (as same may be amended, extended or otherwise
modified from time to time), whether for principal, interest (including,
without limitation, any and all interest accruing upon and after the
commencement of any proceedings under the Code, whether or not such interest is
allowed in any such proceeding), fees (including, without limitation,
forbearance fees), costs, expenses or otherwise, however evidenced, and however
created, whether now existing or hereafter arising, whether direct or indirect,
absolute or contingent, joint or several, due or not due, primary or secondary,
liquidated

 

2

 

or unliquidated, secured or unsecured, original, renewed or extended; provided,
however, that the Senior Debt shall not include any prepayment premiums.

 

“Senior Liens” means all liens, security interests,
pledges and other encumbrances of any kind, in, to or in respect of any assets
or properties of the Company, held from time to time by the holder or holders
of Senior Debt as collateral security for the payment and/or performance of
Senior Debt, including but not limited to those liens, security interests and
other encumbrances created and/or evidenced by the Senior Security Documents.

 

“Senior Loan
Documents” means the Senior Loan Agreement, the Senior Notes, the Senior
Security Documents, and any and all other agreements and instruments executed
and delivered pursuant thereto or in respect thereof.

 

“Standstill Period”
shall mean the 180-day period commencing on the date on which the Junior
Creditor gives notice to the Senior Creditor that there has occurred and is
continuing an Event of Default (as such term is defined in the Junior Loan
Agreement) within any of clauses (a), (d), (e), (g), (h), (j) or (k) of the
definition thereof contained in the Junior Loan Agreement or by reason of any
material non-compliance by the Company with its obligations under Section 5.1
of the Asset Purchase Agreement; provided, however, that if,
during such 180-day period, the Senior Creditor shall take action to sue upon
or otherwise enforce the Senior Debt, or foreclose or exercise other
substantive remedies with respect to the Senior Liens, then the Standstill
Period shall be deemed to be tolled on the date on which the initial such
action by the Senior Creditor occurred and such Standstill Period shall
continue immediately upon the Senior Creditor’s failure to pursue or otherwise
continue such action(s).

 

2.             Subordination of
Junior Debt; Standstill.

 

(a)           Subject
to Sections 2(b) and 2(c) below, the Junior Creditor will not ask, demand, accelerate,
sue for, enforce, take, collect or receive, by set-off or in any other
manner, any payments on or in respect of the Junior Debt (whether of principal,
interest, collection costs or otherwise) from the Company, or any successor or
assign of the Company, including, without limitation, a receiver, trustee or
debtor-in-possession (the term “Company” hereinafter shall include
any such successor and assign of the Company), or from any other person, firm,
partnership, corporation or other entity for the benefit of the Company, unless
and until the earlier of (i) all of the Senior Debt (exclusive of contingent
indemnification obligations to the extent that no claim giving rise thereto has
been asserted) shall have been fully paid and satisfied with interest
(including, without limitation, any and all interest accruing upon and after
the commencement of any proceedings under the Code, whether or not such
interest is allowed in any such proceeding), and the Senior Loan Agreement and
all other Senior Loan Documents have been terminated, or (ii) the expiration or
termination of the Standstill Period. 
Upon the expiration or termination of the Standstill Period, the Junior
Creditor may, to the extent provided in the Junior Loan Documents, accelerate,
enforce and sue for collection of the Junior Debt, provided that any
collection(s) made by the Junior Creditor shall be subject to Section 5 below.

 

3

 

(b)           Notwithstanding
the provisions of Section 2(a) above, the Company may pay to the Junior
Creditor, and the Junior Creditor may accept from the Company, the Permitted
Payments as and when due and payable in accordance with the Junior Note, provided
that no Event of Default (as such term is defined in the Senior Loan
Agreement on the date hereof), which has not been waived by the Senior Creditor
(provided that forbearance shall not be deemed a waiver), then exists or would
exist after giving effect to such payment. 
The Junior Creditor hereby acknowledges that an Event of Default under
the Senior Loan Agreement has occurred and is continuing, and will likely
continue indefinitely until and after Permitted Payments become due and payable
under the Junior Note.  Furthermore,
nothing herein contained shall be deemed to prohibit or impair the ability of
the Company to pay, and the Junior Creditor to collect and receive, payment of
the Junior Debt by means of offset, at the time of the closing of the
transactions under the Asset Purchase Agreement, against the purchase price payable
by the Junior Creditor under the Asset Purchase Agreement .

 

(c)           To the
extent that the Permitted Payment is not made when due, the Senior Creditor
shall have the right (but not the obligation) to cure any failure by the
Company to make such Permitted Payment by making such payment on behalf of the
Company to the Junior Creditor. Any such payment made by the Senior Creditor
shall be charged to the Company and treated as the purchase of an Additional
Note (regardless of whether the Senior Loan Agreement contemplates or otherwise
permits the purchase of an Additional Note in such principal amount) on
substantially the same terms and conditions as the Senior Notes.

 

3.             Priorities
in Collateral and Remedies.

 

(a)           Notwithstanding
anything to the contrary contained in the Junior Loan Documents or in any other
agreement between the Company and the Junior Creditor, and notwithstanding the
time, order or method of attachment or perfection as between the Senior Liens
and the Junior Liens, or the time or order of filing or recording of financing
statements or other evidences of liens or security interests, the Junior
Creditor acknowledges and agrees that all Senior Liens shall have absolute and
unconditional priority over any and all Junior Liens, to the full extent of all
Senior Debt.

 

(b)           Anything
contained in Section 2 above to the contrary notwithstanding,  unless and until the earlier of (i) the date
on which all Senior Debt (exclusive of contingent indemnification obligations
to the extent that no claim giving rise thereto has been asserted) has been
indefeasibly paid and satisfied in full in cash, or (ii) the expiration or
termination of the Standstill Period (provided that the Senior Creditor is not
then making good faith efforts to exercise its enforcement remedies with
respect to the Senior Liens), the Junior Creditor shall not, without the prior
written consent of the Senior Creditor, seek to foreclose or exercise any other
enforcement remedies with respect to any Junior Liens, or assert any claims or
interests therein, or institute any legal proceedings with respect to the
subject collateral, or take any other action, directly or indirectly, that
would interfere in any manner with the rights of the holder of the Senior
Liens, including but not limited to the exclusive right to foreclose upon and
effect the sale or disposition of any collateral.  Upon the earlier to occur of the events
described in clauses (i)

 

4

 

and (ii) of this Section 3(b), and provided that the Senior Creditor is
not then making good faith efforts to exercise its enforcement remedies with
respect to the Senior Liens, the Junior Creditor may effect foreclosure and
exercise of its enforcement remedies with respect to the Junior Liens, provided
that (A) any and all net proceeds realized therefrom shall be subject to
Section 5 below, and (B) in the event that the Senior Creditor shall thereafter
make good faith efforts to exercise its enforcement remedies with respect to
the Senior Liens, the Junior Creditor shall suspend the exercise of its
enforcement remedies so as not to interfere with the actions of the Senior
Creditor.

 

(c)           If, as and
when so requested by the Senior Creditor, the Junior Creditor shall (i)
immediately release or otherwise terminate the Junior Liens in connection with
and/or to facilitate the sale, realization upon or other disposition of
collateral by the Senior Creditor, or by the Company with the prior written
consent of the Senior Creditor, in each case with respect to that collateral
which is being sold, realized upon or otherwise disposed of, (A) in the
ordinary course of the Company’s business, (B) prior to the declaration of an
Event of Default by the Senior Creditor under the Senior Loan Agreement if the
Senior Creditor in good faith believes that such sale, realization or
disposition would realize fair value for the subject collateral and the net
proceeds from the sale, realization or disposition of such collateral are
applied to permanently reduce the Senior Debt, or (C) at any time on or after
the declaration of an Event of Default by the Senior Lender under the Senior
Loan Agreement, and (ii) immediately deliver such other release documents as
the Senior Lender may reasonably require in connection therewith; provided,
however, that notwithstanding any such release or termination of the
Junior Liens, or any liquidation or disposition of collateral as aforesaid, the
Junior Liens shall nonetheless attach to the proceeds of such collateral in the
same priority as existed prior to such action.

 

4.             Priority;
Grant of Authority.  In the event of
any distribution, division or application, partial or complete, voluntary or
involuntary, by operation of law or otherwise, of all or any part of the assets
of the Company of the proceeds thereof to the creditors of the Company, or
readjustment of the obligations and indebtedness of the Company, whether by
reason of liquidation, bankruptcy, arrangement, receivership, assignment for
the benefit of creditors or any other action or proceeding involving the
readjustment of all or any part of the Junior Debt, or the application of the
assets of the Company to the payment or liquidation thereof, or upon the
dissolution, liquidation, cessation or other winding up of the Company’s
business, or upon the sale of all or substantially all of the Company’s assets
(other than the sale of assets in accordance with the Asset Purchase Agreement
in which the Junior Debt is offset against the purchase price otherwise payable
by the Junior Creditor at the closing thereunder), then, and in any such event,
(a) the holders of Senior Debt shall be entitled to receive payment in full in
cash of any and all of the Senior Debt prior to the payment of all or any part
of the Junior Debt, and (b) any payment or distribution of any kind or
character, whether in cash, securities or other property, which shall be
payable or deliverable upon or with respect to any or all of the Junior Debt
shall be paid or delivered directly to the holders of Senior Debt for ratable
application on any of the Senior Debt, due or not due, until such Senior Debt
(exclusive of contingent indemnification obligations to the extent that no
claim giving rise thereto has been asserted) shall have first been fully paid
and satisfied.  In order to enable the
Senior Creditor to enforce its rights hereunder in any of the

 

5

 

aforesaid actions or
proceedings, the Senior Creditor is hereby irrevocably authorized and
empowered, in its discretion, to make and present for and on behalf of the
Junior Creditor such proofs of claim against the Company on account of the
Junior Debt as the Senior Creditor may deem expedient or proper (but only if
the Junior Creditor does not make or present such proofs of claim within ten
(10) days prior to the proof of claims filing bar date) and to vote such proofs
of claim in any such proceeding (but only if the Junior Creditor does not
timely vote such proofs of claim) and to receive and collect any and all
dividends or other payments or disbursements made thereon in whatever form the
same may be paid or issued and to apply the same on account of any of the
Senior Debt.  The Junior Creditor
irrevocably authorizes and empowers the Senior Creditor to demand, sue for,
collect and receive each of the aforesaid payments and distributions and give
acquittance therefor and to file claims and take such other actions, in the
Senior Creditor’s own name or in the name of the Junior Creditor or otherwise,
as the Senior Creditor may deem necessary or advisable for the enforcement of
this Agreement; and the Junior Creditor will execute and deliver to the Senior
Creditor such powers of attorney, assignments and other instruments or
documents, including notes (together with such assignments or endorsements as
the Senior Creditor shall deem necessary), as may be requested by the Senior
Creditor in order to enable the Senior Creditor to enforce any and all claims
upon or with respect to any or all of the Junior Debt and to collect and
receive any and all payments and distributions which may be payable or
deliverable at any time upon or with respect to the Junior Debt, all for the
Senior Creditor’s own benefit.  Following
payment in full of the Senior Debt, but subject to the rights of any other
lienholders or creditors of the Company, the Senior Creditor will remit to the
Junior Creditor, to the extent of the Junior Creditor’s interest therein, all
dividends or other payments or distributions paid to and held by the Senior
Creditor in excess of the Senior Debt.

 

5.             Payments
Received by the Junior Creditor.

 

(a)           Except for Permitted
Payments made subject to and in accordance with Section 2(b) above, in the
event that, whether prior, during or subsequent to any Standstill Period, any
payment, distribution, security or instrument, or any proceeds thereof, shall
be received by the Junior Creditor upon or with respect to the Junior Debt or
in respect of the Junior Liens prior to the payment in full in cash of the
Senior Debt (exclusive of contingent indemnification obligations to the extent
that no claim giving rise thereto has been asserted) and termination of the
Senior Loan Agreement and all other Senior Loan Documents, the Junior Creditor
shall receive and hold the same in trust as trustee for the benefit of the Senior
Creditor, and shall forthwith wire transfer the amount of the same to the
Senior Creditor, for application on any of the Senior Debt, due or not due,
and, until so delivered, the same shall be held in trust by the Junior Creditor
as the property of the Senior Creditor, and shall not be commingled with any
other property of Junior Creditor. In the event of the failure of the Junior
Creditor to make any such endorsement, assignment or transfer to the Senior
Creditor, the Senior Creditor or any of its officers or employees, is hereby
irrevocably authorized to make the same.

 

(b)           Any and all payments
which are turned over by the Junior Creditor to the Senior Creditor pursuant to
Section 5(a) above shall not be deemed to be payments on account of the Junior
Debt, and the Junior Creditor shall be subrogated to the rights of the Senior
Creditor

 

6

 

with respect to
such payments applied to the Senior Debt, provided that such rights of
subrogation shall not be exercisable or enforceable unless and until the Senior
Debt (exclusive of contingent indemnification obligations to the extent that no
claim giving rise thereto has been asserted) is paid in full in cash and the
Senior Loan Agreement and all other Senior Loan Documents are terminated.

 

6.             Ownership:
Absence of Other Collateral.

 

(a)           The Junior
Creditor warrants and represents that the Junior Creditor has not previously
assigned or transferred any interest in the Junior Debt, that no other party
owns any interest in the Junior Debt other than the Junior Creditor, and that
the entire Junior Debt is owing only to the Junior Creditor; and the Junior
Creditor covenants that the entire Junior Debt shall at all times continue to
be owing only to the Junior Creditor except to the extent assigned or
transferred to an assignee or transferee (which may include, without
limitation, any prospective purchaser of any assets or business of the Company)
who expressly agrees in writing, to and for the benefit of the Senior Creditor,
to hold such Junior Debt subject to the terms of this Agreement.

 

(b)           The Junior
Creditor further warrants and represents that, except for the collateral
described in and subject to the Junior Security Documents, no collateral
security of any kind has been granted or exists for the purpose of securing, in
any manner, the payment of any Junior Debt; and the Company agrees not to
grant, and the Junior Creditor agrees not to receive or accept, any collateral
security for the Junior Creditor other than as set forth in the Junior Security
Documents.  Any lien or security interest
purported to be granted in violation of this Section 6(b) shall be null and
void ab  initio, and of no force or effect.

 

7.             No
Amendment; Instrument Legend.

 

(a)           None of
the stated terms of the Junior Loan Documents, as presently in effect, may be
altered, amended or otherwise modified, without the prior written consent of
the Senior Creditor, in any manner such as would (i) change the stated interest
rate, payment terms or maturity thereof in any manner adverse to the Company,
(ii) require any payments to be made thereunder of any amounts greater than, or
at any dates earlier than, those presently provided for therein, (iii) increase
or modify the collateral security therefor or thereunder, or (iv) in any manner
increase or otherwise alter the Company’s obligations thereunder in any manner
adverse to the Company.

 

(b)           The Junior
Note will be inscribed with a legend, and each other Junior Loan Document will
include provisions, conspicuously indicating that payment thereof and
thereunder and all rights of the Junior Creditor thereunder are subject and
subordinated to the claims of the holders of Senior Debt pursuant to the terms
of this Agreement, and true and complete copies thereof will be delivered to
the Senior Creditor. Any instrument, agreement or certificate evidencing or
securing any of the Junior Debt, or any portion thereof, which is hereafter
executed by the Company will, on the date thereof, be inscribed with the
aforesaid

 

7

 

legend or provision and a true and complete copy thereof will be
delivered to the Senior Creditor on the date of its execution or within five
(5) business days thereafter.

 

8.             Continuing
Subordination: Nature of Subordination.

 

(a)           The Junior
Creditor acknowledges and agrees that, to the extent the terms and provisions
of this Agreement may be inconsistent with any of the Junior Loan Documents or
any other such other agreement, instrument or document, the Junior Loan
Documents and such other agreements, instruments and documents shall be deemed
to be superseded by this Agreement.

 

(b)           This
Agreement shall be irrevocable and shall remain in effect until the Senior Debt
shall have been indefeasibly paid in full in cash and the Senior Loan Agreement
and all other Senior Loan Documents have been terminated. This is a continuing
agreement of subordination and the Senior Creditor may continue, at any time
and without notice to the Junior Creditor, to extend credit or other financial
accommodations and loan monies to or for the benefit of the Company on the
faith hereof, in such amounts and on such terms and conditions as the Senior
Creditor and the Company may agree; provided, however, that
except as and to the extent otherwise provided in Section 2(c) above, the
principal amount (exclusive of interest, fees, costs and expenses) of Senior
Debt shall not exceed $10,000,000 without the prior written consent of the
Junior Creditor.

 

(c)           The
provisions of this Agreement are intended solely for the purpose of defining
the relative rights of the holders of the Senior Debt (on the one hand) and the
holders of the Junior Debt (on the other hand), and none of such provisions
shall impair, as between the Junior Creditor and the Company, the obligations
of the Company to make payments under the Junior Loan Documents in accordance
with the terms thereof (subject to the terms and conditions of this Agreement).

 

9.             Additional
Agreements Between the Company and the Senior Creditor.  The Senior Creditor may, at any time and from
time to time, without in any way impairing or affecting the terms of or the
Junior Creditor’s obligations under this Agreement, (a) enter into such
agreement or agreements with the Company as the Senior Creditor may deem
proper, extending the time of payment of or extending, increasing (subject to
the proviso in Section 8(b) above), renewing or otherwise altering the
terms of the Senior Loan Agreement, any other Senior Loan Document, or all or
any of the Senior Debt, or affecting the Senior Liens or any guaranty
underlying any or all of the Senior Debt, and (b) exchange, sell, release,
surrender or otherwise deal with any such security or guaranties.

 

10.           Junior
Creditor’s Waivers.  The Junior
Creditor expressly waives all notice of the acceptance by the Senior Creditor
of the subordination and other provisions of this Agreement and all other
notices not specifically required pursuant to the terms of this Agreement; and
the Junior Creditor expressly waives reliance by the Senior Creditor upon the
subordination and other agreements as herein provided. The Junior Creditor
acknowledges and agrees that (a) the

 

8

 

Senior Creditor has made
no warranties or representations with respect to the due execution, legality,
validity, completeness or enforceability of the Senior Loan Agreement or any
other Senior Loan Document, or the collectibility of the Senior Debt, (b) the
Senior Creditor shall be entitled to manage and supervise its financial
arrangements with the Company in accordance with its usual practices, modified
from time to time as it deems appropriate under the circumstances, without
affecting the validity or enforceability of this Agreement and without regard
to the existence of any rights that the Junior Creditor may at any time have in
or to any of the assets of Company, and (c) the Senior Creditor shall have no
liability to the Junior Creditor for, and the Junior Creditor waives any claim
which the Junior Creditor may now or hereafter have against the Senior Creditor
arising out of, (i) any and all actions which the Senior Creditor, in good
faith, takes or omits to take (including, without limitation, actions with
respect to the creation, perfection or continuation of liens or security
interests in any existing or future collateral, actions with respect to the
occurrence of a default, actions with respect to the foreclosure upon, sale,
release, or depreciation of, or failure to realize upon, any collateral, and
actions with respect to the collection of any claim for all or any part of the
Senior Debt from any account debtor, guarantor or any other party) with respect
to the Senior Loan Agreement or any other agreement related thereto or to the
collection of the Senior Debt or the valuation, use, protection or release of
collateral, (ii) the Senior Creditor’s election, in any proceeding instituted
under the Code, of the application of Section 1111(b)(2) of the Code, and/or
(iii) any borrowing or grant of a security interest under Section 364 of the
Code by the Company, as debtor in possession. Without limiting the generality
of the foregoing, (A) the Junior Creditor waives the right to assert the
doctrine of marshalling with respect to any of the assets of the Company, and consents
and agrees that the Senior Creditor may proceed against any or all collateral
in such order as the Senior Creditor shall determine in its sole discretion,
(B) the Senior Creditor shall be under no obligation to account to or share
information with the Junior Creditor with respect to any actions taken or
collections made in respect of any collateral, except to the extent of any
payment required to be made to the Junior Creditor pursuant to the last
sentence of Section 4 above, and (C) if the Senior Creditor shall desire to
provide financing to the Company under either Section 363 or Section 364 of the
Code, the Junior Creditor agrees that adequate notice to the Junior Creditor
shall have been provided for such financing if the Junior Creditor receives notice
three (3) business days prior to the entry of the order approving such
financing.

 

11.           Waivers
and Amendments.  No waiver or
amendment shall be deemed to be made by the Senior Creditor or the Junior
Creditor of any of its rights hereunder, unless the same shall be in writing
and signed by the party to be charged therewith, and each waiver, if any, shall
be a waiver only with respect to the specific instance involved and shall in no
way impair the rights of the Senior Creditor or the Junior Creditor or the
obligations of either such party to the other such party in any other respect
at any other time.

 

12.           Information
Concerning the Company.  The Junior
Creditor hereby assumes responsibility for keeping itself informed of the
financial condition of the Company and of all other circumstances bearing upon
the risk of non-payment of the Senior Debt and/or the Junior Debt that
diligent inquiry would reveal, and the Junior Creditor hereby agrees that the
Senior Creditor shall have no duty to advise the Junior Creditor of information
known to the Senior

 

9

 

Creditor regarding such
condition or any such circumstances. In the event that the Senior Creditor, in
its sole discretion, undertakes, at any time or from time to time, to provide
any such information to the Junior Creditor, the Senior Creditor shall be under
no obligation (a) to provide any such information to the Junior Creditor on any
subsequent occasion, or (b) to undertake any investigation not a part of its
regular business routine. The Junior Creditor hereby agrees that all payments
received by the Senior Creditor may be applied, reversed, and reapplied, in
whole or in part, to any of the Senior Debt, without affecting the validity or
enforceability of this Agreement, and assents to any extension or postponement
of the time of payment of the Senior Debt or to any other indulgence with
respect thereto, to any substitution, exchange or release of all or any
collateral and to the addition or release of any other party or person
primarily or secondarily liable therefor.

 

13.           Notices.  Any and all notices hereunder shall be in
writing and addressed to the party to be notified as follows:

 

If to the Senior Creditor:

 

ComVest Investment
Partners II LLC

One North Clematis,
Suite 300

West Palm Beach,
Florida 33401

Attention: Carl
Kleidman

 

with a copy to:

 

Greenberg Traurig,
LLP

200 Park Avenue

New York, New York
10166

Attention: Alan
Annex, Esq.

Telecopier: (212)
801-6400

 

If to the Junior
Creditor:

 

Hologic, Inc.

35 Crosby Drive

Bedford, MA
01730-1401

Attention: Jack
Cumming

Telecopier: (781)
276-0580

 

with a copy to:

 

Brown Rudnick
Berlack Israels LLP

One Financial
Center

Boston, MA 02111

Attention: Philip
J. Flink, Esq.

Telecopy: (617)
526-5000

 

10

 

If to the Company:

 

Fischer Imaging
Corporation

12300 North Grant
Street

Denver, Colorado
80241

Attention: Harris
Ravine

Telecopier: (303)
450-4335

 

with a copy to:

 

Davis Graham &
Stubbs LLP

1550 Seventeenth
Street

Suite 500

Denver, Colorado
80202

Attention: Ronald
R. Levine, II, Esq.

Telecopier: (303)
893-1379

 

or to such other address
as any party may designate for itself by notice.  Notice shall be deemed to have been duly
given when (a) delivered personally or otherwise actually received, (b) sent by
overnight delivery service, (c) mailed by first class United States mail,
postage prepaid, registered or certified, with return receipt requested, or (d)
sent by facsimile with facsimile confirmation of receipt (with duplicate notice
sent by United States mail as provided above).

 

14.           CONSENT
TO JURISDICTION; WAIVERS.  THE JUNIOR
CREDITOR AGREES, IN RESPECT OF ANY ACTION OR PROCEEDING RELATING TO THIS
AGREEMENT, TO THE EXCLUSIVE JURISDICTION OF ANY AND ALL LOCAL, STATE AND/OR
FEDERAL COURTS SITTING IN THE STATE OF NEW YORK, AND WAIVES ANY OBJECTION WHICH
THE JUNIOR CREDITOR MAY HAVE BASED ON IMPROPER VENUE OR FORUM  NON
CONVENIENS TO THE CONDUCT OF ANY PROCEEDING IN ANY SUCH COURT.  AT THE OPTION OF THE SENIOR CREDITOR, THE JUNIOR
CREDITOR WAIVES, TO THE EXTENT PERMITTED BY LAW, TRIAL BY JURY, AND WAIVES ANY
BOND OR SURETY OR SECURITY UPON SUCH BOND WHICH MIGHT, BUT FOR THIS WAIVER, BE
REQUIRED OF THE SENIOR CREDITOR.  NOTHING
CONTAINED HEREIN SHALL AFFECT THE RIGHT OF THE SENIOR CREDITOR TO BRING ANY
ACTION OR PROCEEDING AGAINST THE JUNIOR CREDITOR OR THE JUNIOR CREDITOR’S
PROPERTY IN THE COURTS OF ANY OTHER JURISDICTION.

 

15.           Governing
Law.  This Agreement shall
(irrespective of the place where it is executed and delivered) be governed,
construed and controlled by and under the laws of the State of New York
(without giving effect to principles of conflicts of laws).

 

16.           Binding
Effect.  This Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective successors and assigns.

 

11

 

17.           Captions.  The Section titles utilized in this Agreement
are for convenience only, and shall not affect the construction or
interpretation of this Agreement or any of the provisions hereof.

 

18.           Counterparts.  This Agreement may be executed in any number
of counterparts and by fax signature pages, each of which shall be deemed to
constitute an original, but all of which together shall constitute one and the
same instrument.

 

19.           Severability.  In the event and to the extent that any
provision of this Agreement shall be held invalid or unenforceable, such
invalidity or unenforceability shall not effect the validity or enforceability
of any other provisions of this Agreement, all of which shall remain fully
enforceable as set forth herein.

 

[The remainder of this
page is intentionally blank]

 

12

 

IN
WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their duly authorized officers on and as of the date first set
forth above.

 

	
   

  	
  COMVEST INVESTMENT
  PARTNERS II LLC

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Larry E. Lenig, Jr.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  HOLOGIC, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Glenn P. Muir

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  FISCHER IMAGING
  CORPORATION

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Harris Ravine

  	
   

  

 

13

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