Hologic settles dispute with Fleet

August 22, 2001

Hologic has reached a settlement in its two-year dispute with Fleet Business Credit regarding a Master Product Financing Agreement entered into in September 1996. Under the original agreement, Fleet acquired Hologic bone densitometry systems to lease to

Hologic has reached a settlement in its two-year dispute with Fleet Business Credit regarding a Master Product Financing Agreement entered into in September 1996. Under the original agreement, Fleet acquired Hologic bone densitometry systems to lease to physicians on a fee-per-scan basis throughout the U.S. During the course of this three-year deal, Hologic sold around $61 million of bone densitometers. Fleet, however, suffered substantial losses under the program and sought to shift losses to Hologic. The settlement agreement provides for all claims to be dismissed with prejudice, and for Hologic to repay Fleet $3.05 million: $1.5 million cash and a note for $1.55 million payable in three years. Certain fees collected from Fleet customers, including scan overages and excess pool deposits, will be counted against the money Hologic must repay Fleet. This credit could reduce the total due to Fleet in three years from $3.05 million to about $1 million.