Exhibit 10.3
SECURITY AGREEMENT
SECURITY AGREEMENT dated as of October 31, 1997 made by PHP HEALTHCARE
CORPORATION, a Delaware corporation (the "Borrower"), each of the other Persons
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listed on the signature pages hereof under the caption "Grantors" and the
Additional Grantors (as defined in Section 25(c)) (the Borrower, the other
Persons so listed and the Additional Grantors being, collectively, the
"Grantors") to NationsBank, N.A. ("NationsBank"), as administrative agent (the
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"Administrative Agent") for the Secured Parties (as defined in the Credit
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Agreement referred to below).
PRELIMINARY STATEMENTS.
(1) The Borrower has entered into a Credit Agreement dated as of October
31, 1997 (said Agreement, as it may hereafter be amended or otherwise modified
from time to time, being the "Credit Agreement"; the terms defined therein and
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not otherwise defined herein being used herein as therein defined) with the
banks, financial institutions and other institutional lenders party thereto (the
"Lenders"), NationsBank, as initial issuing bank and the Administrative Agent.
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(2) Each Grantor is the owner of the shares (the "Pledged Shares") of stock
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set forth opposite such Grantor's name in Part I of Schedule I hereto and issued
by the corporations named therein and of the indebtedness (the "Pledged Debt")
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set forth opposite such Grantor's name in Part II of said Schedule I and issued
by the obligors named therein.
(3) The Borrower has opened a non-interest bearing cash collateral account
(the "Cash Collateral Account") with NationsBank at its office at 100 North
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Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 Account No. 375-052-7254, in the
name of the Borrower but under the sole control and dominion of the
Administrative Agent and subject to the terms of this Agreement.
(4) The Borrower has opened a non-interest bearing cash collateral account
(the "L/C Cash Collateral Account") with NationsBank at its office at 000 Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 Account No. 375-089-7418, in the
name of the Borrower but under the sole control and dominion of the
Administrative Agent and subject to the terms of this Agreement.
(5) It is a condition precedent to the making of Advances by the Lenders
and to the issuance of Letters of Credit by the Issuing Bank under the Credit
Agreement from time to time, that the Grantors shall have granted the assignment
and security interest and made the pledge and assignment contemplated by this
Agreement.
NOW THEREFORE, in consideration of the premises and in order to induce the
Lender Parties to make Advances under the Credit Agreement and the Issuing Bank
to issue Letters of
Credit under the Credit Agreement from time to time, each of the Grantors hereby
agrees with the Administrative Agent for its benefit and the ratable benefit of
the Secured Parties as follows:
Section 1. Grant of Security. Each of the Grantors hereby assigns and
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pledges to the Administrative Agent for its benefit and the ratable benefit of
the Secured Parties, and hereby grants to the Administrative Agent for its
benefit and the ratable benefit of the Secured Parties a security interest in,
the following (collectively, the "Collateral"):
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(a) all of such Grantor's right, title and interest, whether now owned or
hereafter acquired, in and to all equipment in all of its forms, wherever
located, now or hereafter existing, all fixtures and all parts thereof and all
accessions thereto (any and all such equipment, fixtures, parts and accessions
being the "Equipment");
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(b) all of such Grantor's right, title and interest, whether now owned or
hereafter acquired, in and to all inventory in all of its forms, wherever
located, now or hereafter existing (including, but not limited to, (i) all raw
materials and work in process therefor, finished goods thereof and materials
used or consumed in the manufacture or production thereof, (ii) goods in which
such Grantor has an interest in mass or a joint or other interest or right of
any kind (including, without limitation, goods in which such Grantor has an
interest or right as consignee) and (iii) goods that are returned to or
repossessed by such Grantor), and all accessions thereto and products thereof
and documents therefor (any and all such inventory, accessions, products and
documents being the "Inventory");
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(c) all of such Grantor's right, title and interest, whether now owned or
hereafter acquired, in and to all accounts, contract rights, chattel paper,
instruments, deposit accounts, general intangibles and other obligations of any
kind, now or hereafter existing, whether or not arising out of or in connection
with the sale or lease of goods or the rendering of services, and all rights now
or hereafter existing in and to all security agreements, leases and other
contracts securing or otherwise relating to any such accounts, contract rights,
chattel paper, instruments, deposit accounts, general intangibles or obligations
(any and all such accounts, contract rights, chattel paper, instruments, deposit
accounts, general intangibles and obligations, to the extent not referred to in
clause (d), (e) or (f) below, being the "Receivables", and any and all such
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leases, security agreements and other contracts being the "Related Contracts");
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(d) all of the following (the "Security Collateral"):
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(i) the Pledged Shares and the certificates representing the Pledged
Shares, and all dividends, cash, instruments and other property from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all of the Pledged Shares;
(ii) the Pledged Debt and the instruments evidencing the Pledged Debt,
and all interest, cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of or in exchange for
any or all of the Pledged Debt;
(iii) all additional shares of stock of any issuer of the Pledged
Shares from time to time acquired by such Grantor in any manner, and the
certificates representing such additional shares, and all dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
shares;
(iv) all additional indebtedness from time to time owed to such
Grantor by any obligor of the Pledged Debt and the instruments evidencing such
indebtedness, and all interest, cash, instruments and other property from time
to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such indebtedness; and
(v) all of such Grantor's right, title and interest in and to the
membership interests in any Person and all dividends, cash, instruments and
other property from time to time received, receivable or otherwise distributed
in respect of or in exchange for any or all of such membership interests.
(e) all of such Grantor's right, title and interest in and to each of the
agreements listed on Schedule II, and each Hedge Agreement to which such Grantor
is now or may hereafter become a party, in each case as such agreements may be
amended or otherwise modified from time to time (collectively, the "Assigned
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Agreements"), including, without limitation, (i) all rights of such Grantor to
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receive moneys due and to become due under or pursuant to the Assigned
Agreements, (ii) all rights of such Grantor to receive proceeds of any
insurance, indemnity, warranty or guaranty with respect to the Assigned
Agreements, (iii) claims of such Grantor for damages arising out of or for
breach of or default under the Assigned Agreements and (iv) the right of such
Grantor to terminate the Assigned Agreements, to perform thereunder and to
compel performance and otherwise exercise all remedies thereunder (all such
Collateral being the "Agreement Collateral");
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(f) all of the following (collectively, the "Account Collateral"):
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(i) the Cash Collateral Account, all funds held therein and all
certificates and instruments, if any, from time to time representing or
evidencing the Cash Collateral Account;
(ii) the L/C Cash Collateral Account, all funds held therein and all
certificates and instruments, if any, from time to time representing or
evidencing the L/C Cash Collateral Account;
(iii) all Lockbox Accounts (as hereinafter defined), all funds held
therein and all certificates and instruments, if any, from time to time
representing or evidencing the Lockbox Accounts;
(iv) all other deposit accounts of such Grantor, all funds held
therein and all certificates and instruments, if any, from time to time
representing or evidencing such deposit accounts;
(v) all Collateral Investments (as hereinafter defined) from time
to time and all certificates and instruments, if any, from time to time
representing or evidencing the Collateral Investments;
(vi) all notes, certificates of deposit, deposit accounts, checks
and other instruments from time to time hereafter delivered to or otherwise
possessed by the Administrative Agent for or on behalf of such Grantor in
substitution for or in addition to any or all of the then existing Account
Collateral; and
(vii) all interest, dividends, cash, instruments and other property
from time to time received, receivable or otherwise distributed in respect of or
in exchange for any or all of the then existing Account Collateral; and
(g) all proceeds of any and all of the foregoing Collateral (including,
without limitation, proceeds that constitute property of the types described in
clauses (a) - (f) of this Section 1) and, to the extent not otherwise included,
all (i) payments under insurance (whether or not the Administrative Agent is the
loss payee thereof), or any indemnity, warranty or guaranty, payable by reason
of loss or damage to or otherwise with respect to any of the foregoing
Collateral and (ii) cash.
Section 2. Security for Obligations. This Agreement secures the payment
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of all Obligations of each Grantor now or hereafter existing under the Loan
Documents, whether for principal, interest, fees, expenses or otherwise (all
such Obligations being the "Secured Obligations"). Without limiting the
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generality of the foregoing, this Agreement secures the payment of all amounts
that constitute part of the Secured Obligations and would be owed by each
Grantor to the Administrative Agent or the Secured Parties under the Loan
Documents but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
such Grantor.
Section 3. Grantors Remain Liable. Anything herein to the contrary
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notwithstanding, (a) each Grantor shall remain liable under the contracts and
agreements included in the Collateral to the extent set forth therein to perform
all of its duties and obligations thereunder to the same extent as if this
Agreement had not been executed, (b) the exercise by the Administrative Agent of
any of the rights hereunder shall not release any Grantor from any of its duties
or obligations under the contracts and agreements included in the Collateral and
(c) neither the Administrative Agent nor any Secured Party shall have any
obligation or liability under the contracts and agreements included in the
Collateral by reason of this Agreement, nor shall the Administrative Agent or
any Secured Party be obligated to perform any of the obligations or duties of
any Grantor thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder.
Section 4. Delivery of Security Collateral and Account Collateral. All
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certificates or instruments representing or evidencing Security Collateral or
Account Collateral shall be
delivered to and held by or on behalf of the Administrative Agent pursuant
hereto and shall be in suitable form for transfer by delivery, or shall be
accompanied by duly executed instruments of transfer or assignment in blank, all
in form and substance reasonably satisfactory to the Administrative Agent. The
Administrative Agent shall have the right, at any time after the occurrence and
during the continuance of an Event of Default, in its discretion and without
notice to any Grantor, to transfer to or to register in the name of the
Administrative Agent or any of its nominees any or all of the Security
Collateral and Account Collateral, subject only to the revocable rights
specified in Section 14(a). In addition, the Administrative Agent shall have the
right at any time to exchange certificates or instruments representing or
evidencing Security Collateral or Account Collateral for certificates or
instruments of smaller or larger denominations.
Section 5. Maintaining the Cash Collateral Account and the L/C Cash
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Collateral Account. So long as any Advance shall remain unpaid, any Letter of
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Credit shall be outstanding or any Secured Party shall have any Commitment under
the Credit Agreement:
(a) The Borrower will maintain the Cash Collateral Account and the L/C Cash
Collateral Account with NationsBank.
(b) It shall be a term and condition of each of the Cash Collateral Account
and the L/C Cash Collateral Account, notwithstanding any term or condition to
the contrary in any other agreement relating to the Cash Collateral Account or
the L/C Cash Collateral Account, as the case may be, and except as otherwise
provided by the provisions of Section 8 and Section 21, that no amount
(including interest on Collateral Investments) shall be paid or released to or
for the account of, or withdrawn by or for the account of, any Grantor or any
other Person from the Cash Collateral Account or the L/C Cash Collateral
Account, as the case may be.
The Cash Collateral Account and the L/C Cash Collateral Account shall be subject
to such applicable laws, and such applicable regulations of the Board of
Governors of the Federal Reserve System and of any other appropriate banking or
governmental authority, as may now or hereafter be in effect.
Section 6. Maintaining the Lockbox Accounts. So long as any Advance shall
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remain unpaid, any Letter of Credit shall be outstanding or any Secured Party
shall have any Commitment under the Credit Agreement:
(a) Each Grantor shall maintain lockboxes and blocked deposit accounts
("Lockbox Accounts") only with banks ("Lockbox Banks") that have entered (or
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will enter prior to December 5, 1997) into letter agreements in substantially
the form of Exhibit A with such Grantor and the Administrative Agent ("Lockbox
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Letters").
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(b) Each Grantor shall immediately instruct each Person obligated at any
time to make any payment to such Grantor for any reason (an "Obligor") to make
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such payment to a Lockbox Account or to the Cash Collateral Account and shall
pay to the Administrative Agent for deposit in the Cash Collateral Account, at
the end of each Business Day, all proceeds of
Collateral and all other cash of such Grantor in excess of $500,000 in the
aggregate; provided, however, that D.C. Chartered Health Plan, Inc. may keep on
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deposit in a deposit account any amount that is required to be kept on deposit
by it by its governmental regulatory authority.
(c) Each Grantor shall instruct each Lockbox Bank maintained by such
Grantor to transfer to the Cash Collateral Account, at the end of each Business
Day, in same day funds, an amount equal to the credit balance of the Lockbox
Account in such Lockbox Bank.
(d) Upon any termination of any Lockbox Letter or other agreement with
respect to the maintenance of a Lockbox Account by any Grantor or any Lockbox
Bank, such Grantor shall immediately notify all Obligors that were making
payments to such Lockbox Account to make all future payments to another Lockbox
Account or to the Cash Collateral Account. Each Grantor agrees to terminate any
or all Lockbox Accounts and Lockbox Letters upon request by the Administrative
Agent.
Section 7. Investing of Amounts in the Cash Collateral Account and the L/C
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Cash Collateral Account. If requested by the Borrower, the Administrative Agent
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will, subject to the provisions of Section 8 and Section 21, from time to time
(a) invest amounts on deposit in the Cash Collateral Account and the L/C Cash
Collateral Account in such Cash Equivalents in the name of the Administrative
Agent as the Borrower may select and the Administrative Agent may approve and
(b) invest interest paid on the Cash Equivalents referred to in clause (a)
above, and reinvest other proceeds of any such Cash Equivalents that may mature
or be sold, in each case in such Cash Equivalents in the name of the
Administrative Agent as the Borrower may select and the Administrative Agent may
approve (the Cash Equivalents referred to in clauses (a) and (b) above being
collectively "Collateral Investments"). Interest and proceeds that are not
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invested or reinvested in Collateral Investments as provided above shall be
deposited and held in the Cash Collateral Account or the L/C Cash Collateral
Account, as the case may be.
Section 8. Release of Amounts. So long as no Default shall have occurred
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and be continuing, the Administrative Agent will pay and release to the Borrower
or at its order and at the request of the Borrower, the amount, if any, by which
the credit balance of the Cash Collateral Account exceeds the aggregate unpaid
principal amount of the Revolving Credit Advances.
Section 9. Representations and Warranties. Each Grantor represents and
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warrants as follows:
(a) All of such Grantor's Equipment and Inventory are located at one or
more of the places specified in Schedule III hereto. The chief place of
business and chief executive office of such Grantor and the office where such
Grantor keeps its records concerning the Receivables, and the original copies of
each Assigned Agreement and all originals of all chattel paper that evidence
Receivables, are located at the address specified below the name of such Grantor
on the signature pages hereof (or in the case of any Additional Grantor at the
address listed below the
name of such Additional Grantor on the signature page of the Security Agreement
Supplement (as defined in Section 25(c)) executed and delivered by such
Additional Grantor). Original copies of each Assigned Agreement and all
originals of all chattel paper that evidence Receivables have been delivered to
the Administrative Agent. None of the Receivables or Agreement Collateral is
evidenced by a promissory note or other instrument unless the same has been
delivered to the Administrative Agent.
(b) Such Grantor is the legal and beneficial owner of the Collateral
pledged by such Grantor hereunder free and clear of any Lien, except for the
security interest created by this Agreement and Permitted Liens. No effective
financing statement or other instrument similar in effect covering all or any
part of the Collateral is on file in any recording office, except such as may
have been filed in favor of the Administrative Agent relating to this Agreement
or as permitted by the Credit Agreement. Each Grantor has no trade names other
than the trade names listed on Schedule IV.
(c) Such Grantor has possession and control of the Equipment and Inventory
pledged by such Grantor hereunder.
(d) The Pledged Shares pledged by such Grantor hereunder have been duly
authorized and validly issued and are fully paid and non-assessable. The
Pledged Debt pledged by such Grantor hereunder has been duly authorized,
authenticated or issued and delivered, is the legal, valid and binding
obligation of the issuers thereof and is not in default.
(e) Except as disclosed in the Credit Agreement, the Pledged Shares pledged
by such Grantor hereunder constitute the percentage of the issued and
outstanding shares of stock of the issuers thereof indicated on Schedule I. The
Pledged Debt pledged by such Grantor hereunder is outstanding in the principal
amount indicated on Schedule I.
(f) The Assigned Agreements to which such Grantor is a party, true and
complete copies of which have been furnished to each Secured Party, have been
(to the best knowledge of such Grantor, in the case of any parties other than
such Grantor) duly authorized, executed and delivered by all parties thereto,
have not been amended or otherwise modified, are in full force and effect and
are binding upon and enforceable against all parties thereto in accordance with
their terms except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect that affect creditors' rights generally, general principles of equity
(including, without limitation, standards of materiality, good faith, fair
dealing and reasonableness) whether such principles are considered in a
proceeding in equity or at law, and the application of any fraudulent
conveyance, fraudulent transfer, fraudulent obligation, or preferential transfer
or any law governing the distribution of assets of any Person. To the best
knowledge of such Grantor, there exists no default under any Assigned Agreement
to which such Grantor is a party by any party thereto. Each party to the
Assigned Agreements to which such Grantor is a party (other than such Grantor)
has executed and delivered to such Grantor a consent, in substantially the form
of Exhibit B, to the assignment of the Agreement Collateral to the
Administrative Agent pursuant to this Agreement.
(g) Such Grantor has no Lockbox Accounts or other deposit accounts other
than the Lockbox Accounts listed below such Grantor's name on Schedule V and the
permitted unblocked accounts listed below such Grantor's name on Schedule VI.
Such Grantor has instructed all existing Obligors to make all payments to either
a Lockbox Account or the Cash Collateral Account.
(h) This Agreement, the pledge of the Security Collateral by such Grantor
pursuant hereto and the pledge and assignment of the Account Collateral by such
Grantor pursuant hereto create a valid first priority security interest in the
Collateral of such Grantor (subject only to Permitted Liens and Liens permitted
by Section 5.02(a)(iii), (vii), (viii) or (ix)), securing the payment of the
Secured Obligations, and, upon the filing of the financing statements referred
to in Section 3.01(m) of the Credit Agreement, all filings and other actions
necessary or desirable to perfect and protect such security interest have been
duly taken.
(i) No consent of any other Person (except consents already obtained) and
no authorization, approval or other action by, and no notice to or filing with,
any governmental authority or regulatory body or other third party is required
either (i) for the grant by such Grantor of the assignment and security interest
granted hereby, for the pledge by such Grantor of the Security Collateral
pursuant hereto or for the execution, delivery or performance of this Agreement
by such Grantor, (ii) for the perfection or maintenance of the pledge,
assignment and security interest created hereby (including the first priority
nature of such pledge, assignment or security interest (except as set forth in
Section 9(h) above), except for the filing of financing and continuation
statements under the Uniform Commercial Code, which financing statements have
been duly filed, or (iii) for the exercise by the Administrative Agent of its
voting or other rights provided for in this Agreement or the remedies in respect
of the Collateral pursuant to this Agreement, except (i) as may be required in
connection with the disposition of any portion of the Security Collateral by
laws affecting the offering and sale of securities generally, (ii) the approval
of the Commissioner of Insurance and Securities as to the Pledged Shares issued
by D.C. Chartered Health Plan, Inc. and (iii) the approval of the Bureau of
Insurance as to the Pledged Shares issued by Virginia Chartered Health Plan,
Inc..
(j) The Inventory has been produced by such Grantor in compliance with all
requirements of the Fair Labor Standards Act.
Section 10. Further Assurances. (a) Each Grantor agrees that from time
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to time, at its own expense, such Grantor will promptly execute and deliver all
further instruments and documents, and take all further action, that may be
necessary or desirable, or that the Administrative Agent may reasonably request,
in order to perfect and protect any pledge, assignment or security interest
granted or purported to be granted hereby or to enable the Administrative Agent
to exercise and enforce its rights and remedies hereunder with respect to any
Collateral. Without limiting the generality of the foregoing, each Grantor
will: (i) xxxx conspicuously each document included in the Inventory pledged by
such Grantor hereunder, each chattel paper included in the Receivables pledged
by such Grantor hereunder, each Related
Contract pledged by such Grantor hereunder, each Assigned Agreement to which
such Grantor is a party and, at the request of the Administrative Agent, each of
its records pertaining to the Collateral with a legend, in form and substance
satisfactory to the Administrative Agent, indicating that such document, chattel
paper, Related Contract, Assigned Agreement or Collateral is subject to the
security interest granted hereby; (ii) if any Collateral shall be evidenced by a
promissory note or other instrument or chattel paper, deliver and pledge to the
Administrative Agent hereunder such note or instrument or chattel paper duly
indorsed and accompanied by duly executed instruments of transfer or assignment,
all in form and substance reasonably satisfactory to the Administrative Agent;
and (iii) execute and file such financing or continuation statements, or
amendments thereto, and such other instruments or notices, as may be necessary
or desirable, or as the Administrative Agent may reasonably request, in order to
perfect and preserve the pledge, assignment and security interest granted or
purported to be granted hereby.
(b) Each Grantor hereby authorizes the Administrative Agent to file one or
more financing or continuation statements, and amendments thereto, relating to
all or any part of the Collateral pledged by such Grantor hereunder without the
signature of such Grantor where permitted by law. A photocopy or other
reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.
(c) Each Grantor will furnish to the Administrative Agent from time to time
statements and schedules further identifying and describing the Collateral
pledged by such Grantor hereunder and such other reports in connection with the
Collateral pledged by such Grantor hereunder as the Administrative Agent may
reasonably request, all in reasonable detail.
Section 11. As to Equipment and Inventory. (a) Each Grantor shall keep
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the Equipment and Inventory (other than Inventory sold in the ordinary course of
business) pledged by such Grantor hereunder at the places therefor specified in
Section 9(a) or, upon 30 days' prior written notice to the Administrative Agent,
at such other places in a jurisdiction where all action required by Section 10
shall have been taken with respect to such Equipment and Inventory.
(b) Each Grantor shall cause the Equipment pledged by such Grantor
hereunder to be maintained and preserved in the same condition, repair and
working order as exists on the date hereof or, with respect to Equipment
acquired after the date hereof, as when new, ordinary wear and tear excepted,
and in accordance with any manufacturer's manual, and shall forthwith, or in the
case of any material loss or damage to any of such Equipment as quickly as
practicable after the occurrence thereof, make or cause to be made all repairs,
replacements and other improvements in connection therewith that are necessary
or desirable to such end. Each Grantor shall promptly furnish to the
Administrative Agent a statement respecting any material loss or damage to any
of the Equipment pledged by such Grantor hereunder.
(c) Each Grantor shall pay promptly when due all property and other taxes,
assessments and governmental charges or levies imposed upon, and all claims
(including claims for labor, materials and supplies) against, the Equipment and
Inventory pledged by such Grantor
hereunder, except as permitted by the provisions of the Credit Agreement. In
producing the Inventory pledged by such Grantor hereunder, each Grantor shall
comply with all requirements of the Fair Labor Standards Act.
Section 12. Insurance. (a) Each Grantor shall, at its own expense,
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maintain insurance with respect to the Equipment and Inventory pledged by such
Grantor hereunder in such amounts, against such risks, in such form and with
such insurers, as shall be reasonably satisfactory to the Administrative Agent
from time to time. Each such policy shall provide for all losses to be paid on
behalf of the Administrative Agent and such Grantor as their interests may
appear, and each policy for property damage insurance shall provide for all
losses (except for losses of less than $250,000 per occurrence) to be paid
directly to the Administrative Agent. Each such policy shall in addition (i)
name such Grantor and the Administrative Agents as insured parties thereunder
(without any representation or warranty by or obligation upon the Administrative
Agent) as their interests may appear, (ii) contain the agreement by the insurer
that any loss thereunder shall be payable to the Administrative Agent
notwithstanding any action, inaction or breach of representation or warranty by
such Grantor, (iii) provide that there shall be no recourse against the
Administrative Agent for payment of premiums or other amounts with respect
thereto and (iv) provide that at least 10 days' prior written notice of
cancellation or of lapse shall be given to the Administrative Agent by the
issuer. Each Grantor shall, if so requested by the Administrative Agent,
deliver to the Administrative Agent original or duplicate policies of such
insurance and, as often as the Administrative Agent may reasonably request, a
report of a reputable insurance broker with respect to such insurance. Further,
each Grantor shall, at the request of the Administrative Agent, duly exercise
and deliver instruments of assignment of such insurance policies to comply with
the requirements of Section 10 and cause the insurers to acknowledge notice of
such assignment.
(b) Reimbursement under any liability insurance maintained by any Grantor
pursuant to this Section 12 may be paid directly to the Person who shall have
incurred liability covered by such insurance. In case of any loss involving
damage to Equipment or Inventory when subsection (c) of this Section 12 is not
applicable, the Grantor that owns such Equipment or Inventory shall make or
cause to be made the necessary repairs to or replacements of such Equipment or
Inventory, and any proceeds of insurance maintained by such Grantor pursuant to
this Section 12 shall be paid to such Grantor as reimbursement for the costs of
such repairs or replacements.
(c) Upon the occurrence and during the continuance of any Default or the
actual or constructive total loss (in excess of $250,000 per occurrence) of any
Equipment or Inventory, all insurance payments in respect of such Equipment or
Inventory shall be paid to and applied by the Administrative Agent as specified
in Section 21(b).
Section 13. Place of Perfection; Records; Collection of Receivables. (a)
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Each Grantor shall keep its chief place of business and chief executive office
and the office where it keeps its records concerning the Collateral, and the
original copies of the Assigned Agreements to which
such Grantor is a party and all originals of all chattel paper that evidence
Receivables pledged by such Grantor hereunder, at the location therefor
specified in Section 9(a) or, upon 30 days' prior written notice to the
Administrative Agent, at such other locations in a jurisdiction where all
actions required by Section 10 shall have been taken with respect to the
Collateral. Each Grantor will hold and preserve such records, Assigned
Agreements and chattel paper and will permit representatives of the
Administrative Agent at any time during normal business hours to inspect and
make abstracts from such records and chattel paper.
(b) Except as otherwise provided in this subsection (b), each Grantor shall
continue to collect, at its own expense, all amounts due or to become due such
Grantor under the Receivables. In connection with such collections, each
Grantor may take (and, at the Administrative Agent's direction, shall take) such
action as such Grantor or the Administrative Agent may deem necessary or
advisable to enforce collection of the Receivables pledged by such Grantor
hereunder; provided, however, that the Administrative Agent shall have the right
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at any time, upon the occurrence and during the continuance of an Event of
Default and upon written notice to such Grantor of its intention to do so, to
notify the Obligors under any Receivables of the assignment of such Receivables
to the Administrative Agent and to direct such Obligors to make payment of all
amounts due or to become due to such Grantor thereunder directly to the
Administrative Agent and, upon such notification and at the expense of such
Grantor, to enforce collection of any such Receivables, and to adjust, settle or
compromise the amount or payment thereof, in the same manner and to the same
extent as such Grantor might have done. After receipt by any Grantor of the
notice from the Administrative Agent referred to in the proviso to the preceding
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sentence, (i) all amounts and proceeds (including instruments) received by such
Grantor in respect of such Receivables shall be received in trust for the
benefit of the Administrative Agent hereunder, shall be segregated from other
funds of such Grantor and shall be forthwith paid over to the Administrative
Agent in the same form as so received (with any necessary indorsement) to be
deposited in the Cash Collateral Account and either (A) released to such Grantor
on the terms set forth in Section 8 so long as no Default shall have occurred
and be continuing or (B) if any Event of Default shall have occurred and be
continuing, applied as provided by Section 21(b) and (ii) such Grantor shall not
adjust, settle or compromise the amount or payment of any such Receivable
pledged by such Grantor hereunder, release wholly or partly any Obligor thereof,
or allow any credit or discount thereon.
Section 14. Voting Rights; Dividends; Etc. (a) So long as no Event of
-----------------------------
Default shall have occurred and be continuing:
(i) Each Grantor shall be entitled to exercise any and all voting
and other consensual rights pertaining to the Security Collateral pledged by
such Grantor hereunder or any part thereof for any purpose not inconsistent with
the terms of this Agreement or the other Loan Documents; provided, however, that
-------- -------
each Grantor shall not exercise or refrain from exercising any such right if, in
the Administrative Agent's judgment, such action would have a material adverse
effect on the value of the Security Collateral or any part thereof.
(ii) Each Grantor shall be entitled to receive and retain any and all
dividends and interest paid in respect of the Security Collateral pledged by
such Grantor hereunder; provided, however, that any and all
-------- -------
(A) dividends and interest paid or payable other than in cash in
respect of, and instruments and other property received, receivable or
otherwise distributed in respect of, or in exchange for, any Security
Collateral,
(B) dividends and other distributions paid or payable in cash in
respect of any Security Collateral in connection with a partial or total
liquidation or dissolution or in connection with a reduction of capital,
capital surplus or paid-in-surplus and
(C) cash paid, payable or otherwise distributed in respect of
principal of, or in redemption of, or in exchange for, any Security
Collateral
shall be, and shall be forthwith delivered to the Administrative Agent to hold
as, Security Collateral and shall, if received by such Grantor, be received in
trust for the benefit of the Administrative Agent, be segregated from the other
property or funds of such Grantor and be forthwith delivered to the
Administrative Agent as Security Collateral in the same form as so received
(with any necessary indorsement).
(iii) The Administrative Agent shall execute and deliver (or cause to
be executed and delivered) to each Grantor all such proxies and other
instruments as such Grantor may reasonably request for the purpose of enabling
such Grantor to exercise the voting and other rights that it is entitled to
exercise pursuant to paragraph (i) above and to receive the dividends or
interest payments that it is authorized to receive and retain pursuant to
paragraph (ii) above.
(b) Upon the occurrence and during the continuance of an Event of Default:
(i) All rights of each Grantor (x) to exercise or refrain from
exercising the voting and other consensual rights that it would otherwise be
entitled to exercise pursuant to Section 14(a)(i) shall, upon notice to the
Borrower by the Administrative Agent, cease and (y) to receive the dividends and
interest payments that it would otherwise be authorized to receive and retain
pursuant to Section 14(a)(ii) shall automatically cease, and all such rights
shall thereupon become vested in the Administrative Agent, which shall thereupon
have the sole right to exercise or refrain from exercising such voting and other
consensual rights and to receive and hold as Security Collateral such dividends
and interest payments.
(ii) All dividends and interest payments that are received by any
Grantor contrary to the provisions of paragraph (i) of this Section 14(b) shall
be received in trust for the benefit of the Administrative Agent, shall be
segregated from other funds of such Grantor and shall be forthwith paid over to
the Administrative Agent as Security Collateral in the same form as so received
(with any necessary indorsement).
Section 15. As to the Assigned Agreements. (a) Each Grantor shall at its
-----------------------------
expense:
(i) perform and observe all the terms and provisions of the
Assigned Agreements to which such Grantor is a party to be performed or observed
by it, use reasonable efforts to maintain such Assigned Agreements in full force
and effect, use reasonable efforts to enforce such Assigned Agreements in
accordance with their terms and take all such action to such end as may be from
time to time reasonably requested by the Administrative Agent; and
(ii) furnish to the Administrative Agent promptly upon receipt
thereof copies of all notices, requests and other documents received by such
Grantor under or pursuant to the Assigned Agreements to which such Grantor is a
party, and from time to time (A) furnish to the Administrative Agent such
information and reports regarding the Collateral pledged by such Grantor
hereunder as the Administrative Agent may reasonably request and (B) upon
request of the Administrative Agent make to each other party to any such
Assigned Agreement such demands and requests for information and reports or for
action as such Grantor is entitled to make thereunder.
(b) Each Grantor agrees that it shall not:
(i) cancel or terminate any Assigned Agreement to which such
Grantor is a party or consent to or accept any cancellation or termination
thereof;
(ii) amend or otherwise modify any Assigned Agreement to which such
Grantor is a party or give any consent, waiver or approval thereunder;
(iii) waive any default under or breach of any Assigned Agreement to
which such Grantor is a party;
(iv) consent to or permit or accept any prepayment of amounts to
become due under or in connection with any Assigned Agreement to which such
Grantor is a party, except as expressly provided therein; or
(v) take any other action in connection with any Assigned
Agreement to which such Grantor is a party that would materially impair the
value of the interest or rights of such Grantor thereunder or that would
materially impair the interest or rights of the Administrative Agent.
Section 16. Payments Under the Assigned Agreements and the Material
-------------------------------------------------------
Contracts. (a) Each Grantor agrees, and has effectively so instructed (or
---------
will, within five Business Days following the Closing Date, effectively so
instruct) each other party to each Assigned Agreement and each Material Contract
to which such Grantor is a party, that all payments due or to become due under
or in connection with such Assigned Agreement shall be made directly to the Cash
Collateral Account or to a Lockbox Account.
(b) Except as set forth in Section 21, all moneys received or collected
pursuant to subsection (a) above shall be applied as set forth in Section 8.
Section 17. Transfers and Other Liens; Additional Shares. (a) Each
--------------------------------------------
Grantor agrees that it shall not, other than in accordance with the terms of the
Credit Agreement, (i) sell, assign (by operation of law or otherwise) or
otherwise dispose of, or grant any option with respect to, any of the
Collateral, except sales of Inventory pledged by such Grantor hereunder in the
ordinary course of business, or (ii) create or suffer to exist any Lien upon or
with respect to any of the Collateral except for the pledge, assignment and
security interest created by this Agreement.
(b) Each Grantor agrees that it shall (i) cause each issuer of the Pledged
Shares pledged by such Grantor hereunder not to issue any stock or other
securities in addition to or in substitution for the Pledged Shares issued by
such issuer, except to such Grantor, and (ii) pledge hereunder, immediately upon
its acquisition (directly or indirectly) thereof, any and all additional shares
of stock or other securities owned by such Grantor of each issuer of the Pledged
Shares.
Section 18. Administrative Agent Appointed Attorney-in-Fact. Each Grantor
-----------------------------------------------
hereby irrevocably appoints the Administrative Agent such Grantor's attorney-in-
fact, with full authority in the place and stead of such Grantor and in the name
of such Grantor or otherwise, from time to time in the Administrative Agent's
discretion upon the occurrence and during the continuance of an Event of
Default, to take any action and to execute any instrument that the
Administrative Agent may deem necessary or advisable to accomplish the purposes
of this Agreement, including, without limitation:
(a) to obtain and adjust insurance required to be paid to the
Administrative Agent pursuant to Section 12,
(b) to ask for, demand, collect, xxx for, recover, compromise, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral,
(c) to receive, indorse and collect any drafts or other instruments,
documents and chattel paper, in connection with clause (a) or (b) above, and
(d) to file any claims or take any action or institute any proceedings that
the Administrative Agent may deem necessary or desirable for the collection of
any of the Collateral or otherwise to enforce compliance with the terms and
conditions of any Assigned Agreement or the rights of the Administrative Agent
with respect to any of the Collateral.
Section 19. Administrative Agent May Perform. If any Grantor fails to
--------------------------------
perform any agreement contained herein, the Administrative Agent may itself
perform, or cause performance of, such agreement, and the expenses of the
Administrative Agent incurred in connection therewith shall be payable by such
Grantor under Section 23(b).
Section 20. The Administrative Agent's Duties. The powers conferred on
---------------------------------
the Administrative Agent hereunder are solely to protect its interest in the
Collateral and shall not impose any duty upon it to exercise any such powers.
Except for the safe custody of any Collateral in its possession and the
accounting for moneys actually received by it hereunder, the Administrative
Agent shall have no duty as to any Collateral, as to ascertaining or taking
action with respect to calls, conversions, exchanges, maturities, tenders or
other matters relative to any Security Collateral, whether or not the
Administrative Agent or any Secured Party has or is deemed to have knowledge of
such matters, or as to the taking of any necessary steps to preserve rights
against any parties or any other rights pertaining to any Collateral. The
Administrative Agent shall be deemed to have exercised reasonable care in the
custody and preservation of any Collateral in its possession if such Collateral
is accorded treatment substantially equal to that which NationsBank accords its
own property.
Section 21. Remedies. If any Event of Default shall have occurred and be
--------
continuing:
(a) The Administrative Agent may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or otherwise available
to it, all the rights and remedies of a secured party upon default under the
Uniform Commercial Code in effect in the State of New York at such time (the
"New York Uniform Commercial Code") (whether or not the New York Uniform
---------------------------------
Commercial Code applies to the affected Collateral) and also may (i) require any
or all of the Grantors to, and each Grantor hereby agrees that it will at its
expense and upon request of the Administrative Agent forthwith, assemble all or
part of the Collateral pledged by such Grantor hereunder as directed by the
Administrative Agent and make it available to the Administrative Agent at a
place to be designated by the Administrative Agent that is reasonably convenient
to both parties and (ii) without notice except as specified below, sell the
Collateral pledged by such Grantor hereunder or any part thereof in one or more
parcels at public or private sale, at any of the Administrative Agent's offices
or elsewhere, for cash, on credit or for future delivery, and upon such other
terms as the Administrative Agent may deem commercially reasonable. Each
Grantor agrees that, to the extent notice of sale shall be required by law, at
least ten days' notice to such Grantor of the time and place of any public sale
or the time after which any private sale is to be made shall constitute
reasonable notification. The Administrative Agent shall not be obligated to
make any sale of Collateral regardless of notice of sale having been given. The
Administrative Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned.
(b) All cash proceeds received by the Administrative Agent in respect of
any sale of, collection from, or other realization upon all or any part of the
Collateral may, in the discretion of the Administrative Agent, be held by the
Administrative Agent as collateral for, and/or then or at any time thereafter
applied (after payment of any amounts payable to the Administrative Agent
pursuant to Section 23) in whole or in part by the Administrative Agent for the
ratable benefit of the Secured Parties against, all or any part of the Secured
Obligations in such order as the Administrative Agent shall elect. Any surplus
of such cash or cash proceeds held by the Administrative Agent and remaining
after payment in full of all the Secured Obligations shall be
paid over to the applicable Grantor or to whomsoever may be lawfully entitled to
receive such surplus.
(c) The Administrative Agent may exercise any and all rights and remedies
of any Grantor under or in connection with the Assigned Agreements or otherwise
in respect of the Collateral, including, without limitation, any and all rights
of any Grantor to demand or otherwise require payment of any amount under, or
performance of any provision of, any Assigned Agreement.
(d) All payments received by any Grantor under or in connection with any
Assigned Agreement or otherwise in respect of the Collateral shall be received
in trust for the benefit of the Administrative Agent, shall be segregated from
other funds of such Grantor and shall be forthwith paid over to the
Administrative Agent in the same form as so received (with any necessary
indorsement).
(e) The Administrative Agent may, without notice to any Grantor except as
required by law and at any time or from time to time, charge, set-off and
otherwise apply all or any part of the Secured Obligations against the Cash
Collateral Account or the L/C Cash Collateral Account or any part thereof.
Section 22. Registration Rights. If the Administrative Agent shall
-------------------
determine to exercise its right to sell all or any of the Security Collateral
pursuant to Section 21, each Grantor agrees that, upon request of the
Administrative Agent, such Grantor will, at its own expense:
(a) execute and deliver, and cause each issuer of the Security Collateral
pledged by such Grantor hereunder contemplated to be sold and the directors and
officers thereof to execute and deliver, all such instruments and documents, and
do or cause to be done all such other acts and things, as may be necessary or,
in the opinion of the Administrative Agent, advisable to register such Security
Collateral under the provisions of the Securities Act of 1933, as from time to
time amended (the "Securities Act"), to cause the registration statement
--------------
relating thereto to become effective and to remain effective for such period as
prospectuses are required by law to be furnished and to make all amendments and
supplements thereto and to the related prospectus that, in the opinion of the
Administrative Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto;
(b) use its reasonable efforts to qualify the Security Collateral pledged
by such Grantor hereunder under the state securities or "Blue Sky" laws and to
obtain all necessary governmental approvals for the sale of such Security
Collateral, as requested by the Administrative Agent;
(c) cause each such issuer of the Security Collateral pledged by such
Grantor hereunder to make available to its security holders, as soon as
practicable, an earnings statement that will satisfy the provisions of Section
11(a) of the Securities Act;
(d) provide the Administrative Agent with such other information and
projections as may be necessary or, in the opinion of the Administrative Agent,
advisable to enable the Administrative Agent to effect the sale of the Security
Collateral pledged by such Grantor hereunder; and
(e) do or cause to be done all such other acts and things as may be
necessary to make such sale of the Security Collateral pledged by such Grantor
hereunder or any part thereof valid and binding and in compliance with
applicable law.
The Administrative Agent is authorized, in connection with any sale of the
Security Collateral pursuant to Section 21, to deliver or otherwise disclose to
any prospective purchaser of the Security Collateral (i) any registration
statement or prospectus, and all supplements and amendments thereto, prepared
pursuant to clause (a) above, (ii) any information and projections provided to
it pursuant to clause (d) above and (iii) any other information in its
possession relating to the Security Collateral.
Section 23. Indemnity and Expenses. (a) Each Grantor agrees to indemnify
----------------------
the Administrative Agent from and against any and all claims, losses and
liabilities growing out of or resulting from this Agreement (including, without
limitation, enforcement of this Agreement), except claims, losses or liabilities
resulting from the Administrative Agent's gross negligence or willful misconduct
as determined by a final judgment of a court of competent jurisdiction.
(b) The Borrower will upon demand pay to the Administrative Agent the
amount of any and all reasonable expenses, including the reasonable fees and
expenses of its counsel and of any experts and agents, that the Administrative
Agent may incur in connection with (i) the administration of this Agreement,
(ii) the custody, preservation, use or operation of, or the sale of, collection
from or other realization upon, any of the Collateral, (iii) the exercise or
enforcement of any of the rights of the Administrative Agent or the Secured
Parties hereunder or (iv) the failure by any Grantor to perform or observe any
of the provisions hereof.
Section 24. Security Interest Absolute. The obligations of each Grantor
--------------------------
under this Agreement are independent of the Secured Obligations, and a separate
action or actions may be brought and prosecuted against any Grantor to enforce
this Agreement, irrespective of whether any action is brought against the
Borrower or any other Loan Party or whether the Borrower is joined in any such
action or actions. All rights of the Administrative Agent and the pledge,
assignment and security interest hereunder, and all obligations of the each
Grantor hereunder, shall be absolute and unconditional, irrespective of:
(a) any lack of validity or enforceability of any Loan Document or any
other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of, or in any other
term of, all or any of the Secured Obligations or any other amendment or waiver
of or any consent to any departure from any Loan Document, including, without
limitation, any increase in the Secured Obligations resulting from the extension
of additional credit to the Borrower, any other Loan Party, or any of their
subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any other
collateral, or any taking, release or amendment or waiver of or consent to
departure from any guaranty, for all or any of the Secured Obligations;
(d) any manner of application of collateral, or proceeds thereof, to all or
any of the Secured Obligations, or any manner of sale or other disposition of
any collateral for all or any of the Secured Obligations or any other assets of
any Grantor or any of their subsidiaries;
(e) any change, restructuring or termination of the corporate structure or
existence of any Grantor or any of their subsidiaries; or
(f) any other circumstance that might otherwise constitute a defense
available to, or a discharge of, any Grantor or a third party grantor of a
security interest.
Section 25. Amendments; Waivers; Etc. (a) No amendment or waiver of any
------------------------
provision of this Agreement, and no consent to any departure by any Grantor
herefrom, shall in any event be effective unless the same shall be in writing
and signed by each Grantor and the Administrative Agent, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.
(b) No failure on the part of the Administrative Agent to exercise, and no
delay in exercising any right hereunder, shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right preclude any other or
further exercise thereof or the exercise of any other right.
(c) Upon the execution and delivery by any Person of a supplement to this
Agreement, in each case in substantially the form of Exhibit C hereto (each a
"Security Agreement Supplement"), (i) such Person shall be referred to as an
------------------------------
"Additional Grantor" and shall be and become a Grantor, and each reference in
this Agreement to an "Additional Grantor" or a "Grantor" shall also mean and be
a reference to such Additional Grantor and each reference in any other Loan
Document to a "Grantor" or a "Loan Party" shall also mean and be a reference to
such Additional Grantor, and (ii) the schedule supplements attached to each
Security Agreement Supplement shall be incorporated into and become a part of
and supplement the Schedules to this Agreement, as appropriate, and the
Administrative Agent may attach such supplements to such Schedules, and each
reference to such Schedules shall mean and be a reference to such Schedules, as
supplemented pursuant hereto.
Section 26. Addresses for Notices. All notices and other communications
---------------------
provided for hereunder shall be in writing (including telecopier, telegraphic,
telex or cable communication) and mailed, telegraphed, telecopied, telexed,
cabled or delivered if to any Grantor, addressed to it at the address set forth
below its name on the signature pages hereof, if to any Additional Grantor,
addressed to it at the address set forth below its name on the signature pages
to the Security Agreement Supplement executed and delivered by such Additional
Grantor, if to the Administrative Agent, addressed to it at its address set
forth in Section 8.02 of the Credit Agreement or, as to any party, at such other
address as shall be designated by such party in a written notice to the Grantors
and the Administrative Agent. All such notices and other communications shall,
when mailed, telecopied, telegraphed, telexed or cabled, respectively, be
effective three days after being deposited in the mails or, if sent by overnight
courier, on the day following the day of delivery to the overnight courier, or
when telecopied, delivered to the telegraph company, confirmed by telex
answerback or delivered to the cable company, respectively, addressed as
aforesaid.
Section 27. Continuing Security Interest; Assignments under the Credit
----------------------------------------------------------
Agreement. This Agreement shall create a continuing security interest in the
---------
Collateral and shall (a) remain in full force and effect until the later of the
payment in full in cash of the Secured Obligations and the Termination Date, (b)
be binding upon each Grantor, its successors and assigns and (c) inure, together
with the rights and remedies of the Administrative Agent hereunder, to the
benefit of the Administrative Agent, the Secured Parties and their respective
successors, transferees and assigns. Without limiting the generality of the
foregoing clause (c), any Secured Party may assign or otherwise transfer all or
any portion of its rights and obligations under the Credit Agreement (including,
without limitation, all or any portion of its Commitment, the Advances owing to
it and the Note or Notes held by it to any other Person), and such other Person
shall thereupon become vested with all the benefits in respect thereof granted
to such Lender herein or otherwise, in each case as provided in Section 8.07 of
the Credit Agreement.
Section 28. Release and Termination. (a) Upon any sale, lease, transfer
-----------------------
or other disposition of any item of Collateral in accordance with the terms of
the Loan Documents (other than sales of Inventory in the ordinary course of
business), the Administrative Agent will, at the expense of the Grantor pledging
such item of Collateral hereunder, execute and deliver to such Grantor such
documents as such Grantor shall reasonably request to evidence the release of
such item of Collateral from the assignment and security interest granted
hereby; provided, however, that (i) at the time of such request and such release
-------- -------
no Default shall have occurred and be continuing, (ii) such Grantor shall have
delivered to the Administrative Agent, at least ten days prior to the date of
the proposed release, a written request for release describing the item of
Collateral and the terms of the sale, lease, transfer or other disposition in
reasonable detail, including the price thereof and any expenses in connection
therewith, together with a form of release for execution by the Administrative
Agent and a certification by such Grantor to the effect that the transaction is
in compliance with the Loan Documents and as to such other matters as the
Administrative Agent may request, and (iii) the proceeds of any such sale,
lease, transfer or other disposition required to be applied in accordance with
Section 2.06 of the Credit Agreement shall be paid to, or in accordance with the
instructions of, the Administrative Agent at the closing.
(b) Upon the later of the payment in full in cash of the Secured
Obligations and the Termination Date, the pledge, assignment and security
interest granted hereby shall terminate and all rights to the Collateral shall
revert to the appropriate Grantor. Upon any such termination, the
Administrative Agent will, at such Grantor's expense, execute and deliver to
such Grantor such documents as such Grantor shall reasonably request to evidence
such termination.
Section 29. The Mortgages. In the event that any of the Collateral
-------------
hereunder is also subject to a valid and enforceable Lien under the terms of any
Mortgage and the terms of such Mortgage are inconsistent with the terms of this
Agreement, then with respect to such Collateral, the terms of such Mortgage
shall be controlling in the case of fixtures and leases, letting and licenses
of, and contracts and agreements relating to the lease of real property, and the
terms of this Agreement shall be controlling in the case of all other
Collateral.
Section 30. Governing Law; Terms. This Agreement shall be governed by and
--------------------
construed in accordance with the laws of the State of New York, except to the
extent that the validity or perfection of the security interest hereunder, or
remedies hereunder, in respect of any particular Collateral are governed by the
laws of a jurisdiction other than the State of New York. Unless otherwise
defined herein or in the Credit Agreement, terms used in Article 9 of the New
York Uniform Commercial Code are used herein as therein defined.
IN WITNESS WHEREOF, each Grantor has caused this Agreement to be duly
executed and delivered by its officer thereunto duly authorized as of the date
first above written.
GRANTORS
--------
PHP HEALTHCARE CORPORATION
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
HEALTH COST CONSULTANTS, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
PHP/CHE, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
PHP/IHS, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
PHP LOUISIANA, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
PHP NJ MSO, INC.
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
PINNACLE HEALTH ENTERPRISES, L.L.C.
By PHP HEALTHCARE CORPORATION
as Member
By /s/ Xxxxxxx X. Xxxxxx
---------------------------------
Title:
Address:
By PHP NJ MSO, Inc.
as Member
By /s/ Xxxxxxx X. Xxxxxx
----------------------------------
Title:
Address:
