MedQuest agrees to limit borrowing in exchange for default waiver from lenders

By Ted A. Knutson

Washington, Feb.15 -MedQuest, Inc. said it has agreed not to borrow more than $5 million from its senior credit facility until March 31 or when it produces 2005 fiscal year projections in exchange for a temporary waiver by lenders of potential defaults from the company's failure to meet financial covenants for the period ended Dec. 31 or earlier.

The waiver permanently protects MedQuest from creditor action because of a default that occurred when the company failed to provide lenders with the projections by Feb. 14.

Lenders have extended that deadline to March 31.

The lenders include Wachovia Bank, NA as administrative agent, Chase Lincoln First Commercial Corp. as syndication agent, and General Electric Capital Corp. and Wachovia Bank, NA as co-documentation agents.

As of Feb. 14, MedQuest had borrowed $87.1 million under the facility. The unused portion was $51.2 million.

The Alpharetta, Ga.-based operator of diagnostic imaging centers made the announcement in an 8-K filing with the Securities and Exchange Commission.

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