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EXHIBIT 99.10
UNIVERSAL SUBORDINATION AGREEMENT
THIS UNIVERSAL SUBORDINATION AGREEMENT (the "Agreement"), dated as of
August 3, 1998, is by and among Universal Standard Healthcare, Inc., a Michigan
corporation ("Universal") and Universal Standard Healthcare of Delaware, Inc.
("Universal of Delaware") (Universal and Universal of Delaware are referred to
collectively hereinafter as the "Borrowers"), and Laboratory Corporation of
America Holdings, a Delaware corporation ("LCA").
WHEREAS, Universal and LCA are parties to a certain Co-Marketing
Agreement, dated August 3, 1998 (the "Co-Marketing Agreement"), pursuant to
which LCA will provide marketing services to Universal and Universal of Delaware
and its subsidiaries;
WHEREAS, Universal has agreed to pay LCA a termination fee under
certain circumstances set forth in Section 10 of the Co-Marketing Agreement (the
"Co-Marketing Termination Fee");
WHEREAS, LCA has agreed to subordinate its right to payment of the
Co-Marketing Termination Fee to Senior Debt, Purchase Money Debt and Capital
Leases (as each is defined below) of the Borrowers and to subordinate its
security interest in certain assets of the Borrowers granted by a certain
Security Agreement dated August 3, 1998, between LCA and the Borrowers (the
"Security Agreement") to the security interest held by the holders of Senior
Debt, Purchase Money Debt and Capital Leases; and
WHEREAS, it is a condition precedent to Borrowers entering into a
certain Stock Purchase Agreement dated July 16, 1998 between Universal and LCA
(the "Stock Purchase Agreement") that this Agreement be entered into.
NOW, THEREFORE, in consideration of promises and mutual covenants and
agreements, set forth herein, the parties agree as follows:
1. Subordination. LCA hereby postpones and subordinates (a) all of
the Indebtedness (as defined in the Subordination Agreement dated August 3, 1998
between LCA and NBD Bank attached hereto as Exhibit A (the "NBD Subordination
Agreement")) to the prior payment in full of all of the Obligations (as defined
below) and (b) all liens, security interests, mortgages, and other collateral
security for the Indebtedness (other than liens, security interests and other
collateral security granted in a certain Indemnification Security Agreement
dated August 3, 1998 between LCA and the Borrowers) to all liens, security
interests, mortgages and other collateral security for the Obligations on the
terms and conditions set forth in Sections 5 through 20, inclusive, and 33 of
the NBD Subordination Agreement, as though the holders of the Obligations were
NBD Bank.
2. Obligations. All of each Borrower's present and future
indebtedness, obligations or liabilities (and, in addition, of each Borrower as
a Debtor-in-Possession under any bankruptcy act or code, state or federal law,
common law or equitable doctrine and of any trustee, receiver or other party
appointed for any Borrower under any such laws, doctrine or proceedings) to
holders of the Obligations, including contingent reimbursement obligations of
any Borrower or any Obligor (as
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defined below) to holders of the Obligations in connection with standby and
commercial letters of credit now outstanding or issued in the future issued by
holders of the Obligations for any Borrower's or any Obligor's account
(collectively, "Letters of Credit" and individually a "Letter of Credit"),
leases, adequate protection payments and interest accrued or to be accrued
(including but not limited to interest accruing after the commencement of any
bankruptcy, reorganization, insolvency, receivership or similar proceeding
relating to any Borrower or its property or in an assignment for the benefit of
creditors (collectively, "Proceeding") at the rate then specified in the Credit
Agreements, whether or not such interest is an allowable claim or would
constitute a secured claim in any such Proceeding), prepayment premiums,
absolute or contingent obligations, all obligations and liabilities arising
under any guaranty agreements given by any Borrower in favor of holders of the
Obligations, and obligations acquired by purchase or otherwise as well as all
collection costs and attorneys' fees (whether or not such costs, attorneys'
fees, charges, etc. are an allowable claim or would constitute a secured claim
in any Proceeding) for which any Borrower is now or hereafter becomes liable to
pay to any holder of the Obligations under any agreement (including the Credit
Agreements) or by law are collectively referred to herein as the "Obligations";
provided that, as between the holders of the Obligations and LCA only, for
purposes of this Agreement, the maximum principal amount (including the face
amount of Letters of Credit) that may be included in the Obligations is:
(A) Up to $4,000,000 in Senior Debt (as defined below) from August 3,
1998 to June 29, 1999, $5,000,000 in Senior Debt from June 30, 1999 to June 29,
2000 and $6,000,000 in Senior Debt after June 30, 2000;
(B) Capital Leases (as defined below) in effect at August 3, 1998 and
up to $1,000,000 in additional Capital Leases and Purchase Money Debt (as
defined below) in each calendar year thereafter;
(C) Up to $1,500,000 in Letters of Credit (as defined below); and
(D) Managed Care Letters of Credit (as defined below) in such amounts
as may be outstanding from time to time,
and, in addition to such maximum principal amount, also included in Obligations
are all interest, expenses, fees, and costs (including attorneys' fees) due or
incurred with respect to such maximum principal amount. "Obligations" does not
include interest on principal amounts in excess of the foregoing limits.
The "Credit Agreements" shall mean all agreements between the Borrowers
and the holders of the Obligations.
For purposes of this Agreement, the term "Senior Debt" shall mean the
principal of (and premium, if any) and interest on, and all obligations of the
Borrowers and their subsidiaries for Debt, whether outstanding on the date
hereof or hereafter created, to banks, financial institutions, insurance
companies, business and industrial development corporations, registered
investment companies, entities regularly engaged in the business of lending or
investing money, and entities constituting Accredited Investors as defined in
Rule 501(a)(1), (2) or (3) of the General Rules and Regulations under the
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Securities Act of 1933, as amended, and (ii) any and all extensions and renewals
of any of the foregoing; provided, however, that Senior Debt shall not include
the 8.25% Convertible Subordinated Debentures due February 1, 2006 and
indebtedness as to which the instrument creating or evidencing the same states
that such indebtedness is not superior in right of payment (or is subordinate or
junior) to the Indebtedness.
"Debt" means all liabilities of any of the Borrowers or their
subsidiaries for or in respect of (i) borrowed money or which has been incurred
in connection with the acquisition of property, (ii) obligations for or in
respect of borrowed money or incurred in connection with the acquisition of
property secured by a lien on the property of any of the Borrowers or their
subsidiaries, other than Capital Leases and Purchase Money Debt, (iii)
obligations evidenced by bonds, debentures, notes or other similar instruments,
(iv) all obligations to pay the deferred purchase price of property or services,
other than Capital Leases, Purchase Money Debt and customary trade payables, (v)
all debt of any other person or entity guaranteed by any of the Borrowers or
their subsidiaries and (vi) all obligations, contingent or otherwise, with
respect to letters of credit and banker's acceptances, other than letters of
credit issued to customers of any of the Borrowers or their subsidiaries to
secure the performance by any of the Borrowers or their subsidiaries of their
obligations to such customers under managed care agreements between the customer
and any of the Borrowers or their subsidiaries ("Managed Care Letters of
Credit"), ("Letters of Credit"). "Capital Leases" means all leases of property,
the obligations for rental of which are required to be capitalized on the
consolidated balance sheet of the Borrowers and their subsidiaries in accordance
with generally accepted accounting principles ("GAAP"). "Purchase Money Debt"
means all liabilities incurred by any of the Borrowers or their subsidiaries to
acquire property which is secured solely by such property or other property
securing Purchase Money Debt.
In the event that any of the aforementioned maximum principal amounts
of Senior Debt, Capital Leases, Purchase Money Debt or Letters of Credit (each a
"Principal Ceiling") are exceeded at any time, the terms and conditions of this
Agreement, including postponement or subordination of the payment of any
Indebtedness and the liens, security interests, mortgage and other collateral
security for the Indebtedness, shall be null and void and of no effect
whatsoever as to the excess above the Principal Ceiling, including any
Obligations (besides principal) arising out of or in connection with any such
excess.
3. Acknowledgements. LCA agrees to enter into such agreements or
other documents as may reasonably be required by the holders of the Obligations
to acknowledge, evidence, confirm or clarify the provisions of this Agreement
and to acknowledge the security interest of any holder of the Obligations and
the subordination, as provided herein, of LCA's security interest to the
security interests of such holders of the Obligations.
4. Miscellaneous.
(a) As between the holders of the Obligations and LCA only, in
the event that there is an express conflict between the terms and provisions of
the Credit Agreements and of this Agreement, the terms and conditions of this
Agreement shall govern and control. As between the
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holders of the Obligations and LCA only, in the event that there is an express
conflict between the terms and provisions of the agreements between LCA and the
Borrowers relating to the Indebtedness and of this Agreement, the terms and
conditions of this Agreement shall govern and control. This Agreement is solely
for the holders of the Obligations and LCA's benefit and no other party,
including the Borrowers, is intended to be benefited by this Agreement.
(b) Except where the context otherwise requires, each term
stated in either the singular or plural shall include the singular and the
plural, and pronouns stated in the masculine, feminine or neuter gender shall
include the masculine, feminine and neuter.
(c) This Agreement constitutes the entire understanding of LCA
and Borrowers regarding the subject matter provided for in this Agreement. This
Agreement may only be modified, amended or supplemented by a writing signed by
both LCA and the Borrowers.
(d) This Agreement may be executed in counterparts, all of
which together will be deemed an original of this Agreement. Furthermore,
facsimile/telecopy copies of signatures shall be treated as original signatures
for all purposes.
(e) The rights and remedies specified in this Agreement are
cumulative of each other and not exclusive of any rights or remedies Borrowers
or the holders of the Obligations would otherwise have. Neither the failure nor
any delay on the part of Borrowers or the holders of the Obligations to exercise
any right, remedy, power or privilege hereunder shall operate as a waiver
thereof or give rise to an estoppel, nor be construed as an agreement to modify
the terms of this Agreement, nor shall any single or partial exercise of any
right, remedy, power or privilege with respect to any occurrence be construed as
a waiver of such right, remedy, power or privilege with respect to any other
occurrence. No waiver of any breach of any provision of this Agreement will be
deemed a waiver of any preceding or succeeding breach or of any other provision
of this Agreement. No extension of time for performance of any obligations or
acts will be deemed an extension of the time for performance of any other
obligations or acts. No waiver by a party hereunder shall be effective unless it
is in writing and signed by the party making such waiver, and then only to the
extent specifically stated in such writing.
(f) This Agreement shall be governed by and construed
according to the internal laws of the State of Michigan applicable to contracts
made and performed within the State of Michigan, without regard to conflict of
laws principles.
(g) In various places in this Agreement or the NBD
Subordination Agreement, the phrase "payment in full of the Obligations" or
other similar wording is used. Given that a portion of the Obligations may
consist of contingent reimbursement obligations with respect to the Letters of
Credit, the phrase "payment in full of the Obligations" and other similar
phrases mean, in addition to their ordinary meaning, that the beneficiaries of
all Letters of Credit have returned all such Letters of Credit to the holders of
the Obligations undrawn upon and all such Letters of Credit have been cancelled
and terminated.
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(h) This Agreement benefits and binds LCA, its successors and
assigns, and binds the Borrowers and their successors and assigns and benefits
the holders of the Obligations.
(i) The section headings in this Agreement are included herein
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
(j) All notices, requests, demands or other communications
that are required or may be given pursuant to the terms of this Agreement shall
be in writing and delivery shall be deemed sufficient in all respects and to
have been duly given on the date of service if delivered personally or by
facsimile transmission if receipt is confirmed to the party to whom notice is to
be given, or three (3) days after the date of mailing if mailed by first class -
return receipt requested, postage prepaid and properly addressed as follows:
If to the Borrowers, to:
Universal Standard Healthcare, Inc.
Universal Standard Healthcare of Delaware, Inc.
00000 Xxxxxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attention: President
Copies to:
Xxxxxx Xxxxxxx PLLC
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
If to LCA, to:
Laboratory Corporation of America Holdings
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Legal Department
Copies to:
Mezzullo & XxXxxxxxxx
Suite 825
0000 Xxx Xxxxx Xxxx
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxx, Esq.
or to such other address as may be specified in writing by any of the above.
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(k) Should any part of this Agreement for any reason be
declared by any court of competent jurisdiction to be invalid, that decision
shall not affect the validity of the remaining portion, which shall continue in
full force and effect as if this Agreement had been executed with the invalid
portion eliminated, it being the intent of the parties that they would have
executed the remaining portion of the Agreement without including any part or
portion that may for any reason be declared invalid.
(l) In connection with any litigation brought to enforce any
provision of this Agreement, the prevailing party shall be entitled to recover
its reasonable attorney's fees and costs incurred at the trial and appellate
levels.
IN WITNESS WHEREOF, the parties have executed this Agreement and caused
the same to be delivered on their behalf on the day and year first written
above.
UNIVERSAL STANDARD HEALTHCARE, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, President
UNIVERSAL STANDARD HEALTHCARE OF
DELAWARE, INC.
By: /s/ Xxxx X. Xxx
------------------------------------
Xxxx X. Xxx, Chief Financial Officer
LABORATORY CORPORATION OF AMERICA
HOLDINGS
By: /s/ Xxxxxxxx X. Xxxxx
------------------------------------
Executive Vice President
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SUBORDINATION AGREEMENT
Under This Agreements Certain Payments To The Subordinating
Creditor Are Allowed Unless The Borrowers Default
Date: August 3, 1998
NBD Bank ("NBD" or "Lender") and the undersigned creditor, Laboratory
Corporation of America Holdings, a Delaware corporation individually and on
behalf of its subsidiaries and affiliates and successors and assigns
(collectively, "Junior Creditor"), of Universal Standard Healthcare, Inc.,
formerly known as Universal Standard Medical Laboratories, Inc., a Michigan
corporation ("USML") and Universal Standard Healthcare of Delaware, Inc.,
formerly known as Universal Standard Manage Care, Inc., a Delaware corporation
("Delaware Managed Care"; for convenience, USML and Delaware Managed Care are
referred to collectively as the "Borrowers" and individually as a "Borrower")
agree to the following:
1. USML is now contingently indebted to Junior Creditor in connection
with a Co-Marketing Agreement dated on or about August 3, 1998 between Junior
Creditor and USML (the "Co-Marketing Agreement"), which provides in paragraph 10
thereof for a termination fee (the "Co-Marketing Termination Fee"). The
indebtedness evidenced by or described in the Co-Marketing Agreement (including
the Co-Marketing Termination Fee) and all of each Borrower's other present and
future indebtedness, obligations or liabilities (and, in addition, of each
Borrower as a Debtor-in-Possession under any bankruptcy act or code, state or
federal law, common law or equitable doctrine and of any trustee, receiver or
other party appointed for any Borrower under any such laws, doctrine or
proceedings) to Junior Creditor that are secured by any lien, encumbrance, or
other interest in any assets or property of any Borrower, including any of the
following that are secured by any lien, encumbrance, or other interest in any
assets or property of any Borrower: adequate protection payments and interest
accrued or to be accrued (including but not limited to interest accruing after
the commencement of any bankruptcy, reorganization, insolvency, receivership or
similar proceeding relating to any Borrower or its property or an assignment for
the benefit of creditors), prepayment premiums, absolute or contingent
obligations, all obligations and liabilities arising under all guaranty
agreements given by any Borrower in favor of Junior Creditor, and obligations
acquired by purchase or otherwise as well as all collection costs and attorneys'
fees incurred by Junior Creditor in enforcing its rights against any Borrower
(or any guarantor of any Borrower's obligations) or any collateral for any
Borrower's indebtedness, together with all fees, charges, reimbursement
obligations, indemnity obligations, expenses and attorneys' fees for which any
Borrower is now or hereafter becomes liable to pay to Junior Creditor under any
agreement between any Borrower and Junior Creditor or by law are collectively
referred to herein as the "Indebtedness". Junior Creditor's security for the
Indebtedness is briefly described below next to Junior Creditor's name. Nothing
in this Agreement is intended to permit nor does it permit or allow, without the
prior written consent of Lender, (a) any further loans or advances by Junior
Creditor to any Borrower which constitute Indebtedness or other increases in the
Indebtedness or (b) any further grant of security by any Obligor (as defined
below) to Junior Creditor.
2. Junior Creditor represents and warrants that neither the
Indebtedness nor any collateral security therefor (if any) has been assigned to
or subordinated or subjected to a security interest in favor of any other person
or entity.
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3. Junior Creditor is entering into this Agreement:
(a) To induce Lender to enter into a Sixth Amendment to Revolving
Credit Loan Agreement dated on or about the same date as this Agreement
(the "Sixth Amendment"), between Lender, Borrowers, and others, which
amends the Revolving Credit and Loan Agreement dated April 30, 1997, as
previously amended (as amended (including as amended by the Sixth
Amendment), the "Loan Agreement") [for convenience, (1) the Loan
Agreement and all other notes, documents, instruments, and agreements
executed by NBD or any other party to the Loan Agreement, as may be
amended or restated from time to time, are referred to collectively as
the "Credit Agreements" and individually as "Credit Agreement" and (2)
the Borrowers and each other party to the Loan Agreement, except for
NBD, are referred to collectively as the "Obligors" and individually as
an "Obligor"].
(b) In consideration of loans, advances, payments, extensions of
credit (including the extension or renewal, in whole or in part, of any
debt), benefits or financial accommodations previously made to any
Borrower (or any other party to the Loan Agreement) or which may be
made to any Borrower (or any other party to the Loan Agreement).
(c) In consideration of any of each Borrower's obligations to
Lender, now existing or arising in the future.
4. All of each Borrower's present and future indebtedness,
obligations or liabilities (and, in addition, of each Borrower as a
Debtor-in-Possession under any bankruptcy act or code, state or federal law,
common law or equitable doctrine and of any trustee, receiver or other party
appointed for any Borrower under any such laws, doctrine or proceedings) to
Lender, including contingent reimbursement obligations of any Borrower or any
Obligor to NBD in connection with standby and commercial letters of credit now
outstanding or issued in the future issued by NBD for any Borrower's or any
Obligor's account (collectively, "Letters of Credit" and individually a "Letter
of Credit"), leases, adequate protection payments and interest accrued or to be
accrued (including but not limited to interest accruing after the commencement
of any bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to any Borrower or its property or in an assignment for the
benefit of creditors (collectively, "Proceeding") at the rate then specified in
the Credit Agreements, whether or not such interest is an allowable claim or
would constitute a secured claim in any such Proceeding), prepayment premiums,
absolute or contingent obligations, all obligations and liabilities arising
under all guaranty agreements given by any Borrower in favor of Lender, and
obligations acquired by purchase or otherwise as well as all collection costs
and attorneys' fees incurred by Lender in enforcing its rights against any
Borrower (or any guarantor of any Borrower's obligations) or any collateral for
any Borrower's obligations, together with all fees, charges, reimbursement
obligations, indemnity obligations, expenses and attorneys' fees (whether or not
such costs, attorneys' fees, charges, etc. are an allowable claim or would
constitute a secured claim in any Proceeding) for which any Borrower is now or
hereafter becomes liable to pay to Lender under any agreement (including the
Credit Agreements) or by law are collectively referred to herein as the
"Obligations"; provided that as between Lender and Junior Creditor only, for
purposes of this Agreement, the maximum principal amount (including the face
amount of the Litigation Letter of
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Credit, as defined in the Loan Agreement) that may be included in the
Obligations is $7,500,000 plus the Letter of Credit Amount for the period from
the date hereof through June 28, 1999, increasing to $8,500,000 plus the Letter
of Credit Amount for the period from June 29, 1999 through June 28, 2000,
increasing to $9,500,000 plus the Letter of Credit Amount on and after June 29,
2000 and, in addition to such maximum principal amount, also included in
Obligations are all interest, expenses, fees, and costs (including attorneys'
fees) due or incurred with respect to such maximum principal amount. "Letter of
Credit Amount" means all amounts due NBD in connection with letters of credit
issued by NBD to customers of the Obligors and their subsidiaries to secure
performance by the Obligors and their subsidiaries of their obligations to such
customers under managed care agreements between the customer and the Obligors
and their subsidiaries including, without limitation, letters of credit issued
under Section 2.3 of the Loan Agreement. "Obligations" does not include interest
on principal amounts in excess of the foregoing limits.
5. Junior Creditor hereby postpones and subordinates (a) all of the
Indebtedness to the prior payment in full of all of the Obligations and (b) all
liens, security interests, mortgages and other collateral security for the
Indebtedness to all liens, security interests, mortgages and other collateral
security for the Obligations.
6. Junior Creditor agrees that all liens and security interests in
favor of Junior Creditor now existing or hereafter arising in property of any
Borrower and/or securing the Indebtedness (including proceeds of insurance
policies) are and will be junior in right of priority to and subordinate to any
liens or security interests that Lender, its successors or assigns, have or may
have in the same property. The priorities provided for in this Agreement shall
apply:
(a) without regard to the time or order of attachment,
perfection, filing or recording of the mortgages, security interests
and other liens to secure the obligations of any Borrower, or the
failure to give notice of the acquisition or expected acquisition of
any such mortgage, security interest or lien;
(b) notwithstanding anything to the contrary in the provisions
of the United States Bankruptcy Code or the Uniform Commercial Code in
any relevant state of the United States or the laws of the State of
Michigan or any other relevant state, which relate to the priority of
liens, security interests or mortgages;
(c) with respect to all Indebtedness of each Borrower to the
Junior Creditor, and all of the Obligations of each Borrower to Lender,
whenever made, created or acquired; and
(d) notwithstanding the lapse of perfection of Lender's liens or
security interests or Lender's failure to perfect its liens or security
interests.
7. Junior Creditor acknowledges and agrees that all of the
Obligations are secured by a first-priority, properly perfected, nonavoidable,
lien and security interest in, among other things, all of each Borrower's and
each other Obligor's present and future personal property including all of each
Borrower's and each other Obligor's now existing or hereafter created or
acquired accounts, accounts receivable, documents, instruments, chattel paper,
general intangibles (including, but not limited to all patents, trademarks and
copyrights), inventory,
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equipment, fixtures, tax refunds, earned and unearned insurance premium refunds,
causes of action (including recoveries under 11 U.S.C. Section 542 through 550
and 553), and all products and proceeds of all of the foregoing and all
accessions to any of the foregoing. In furtherance of the foregoing, Junior
Creditor agrees not to contest the validity, extent, perfection, priority,
enforceability or any other aspect of any lien, security interest or mortgage
granted by any Borrower or any other Obligor to Lender or to take or permit any
action prejudicial to or inconsistent with Lender's rights under this Agreement
including Lender's priority position over Junior Creditor that is created by
this Agreement.
8. Unless (1) any Obligor has defaulted (irrespective of whether
Lender has agreed to forbear in enforcing its rights in connection with the
occurrence of such defaults) under the Credit Agreements or any agreement or
note referred to or incorporated therein and during the continuance of such
default, or (2) the making of a payment would cause a default under the Credit
Agreements or any related documents or agreements, Junior Creditor may receive
payments from USML on account of the Indebtedness, but only as follows:
(a) Payment of the Co-Marketing Termination Fee may be made at
its scheduled maturity date as provided in the Co-Marketing
Agreement (without amendment), but not by prepayment,
acceleration or otherwise.
(b) No payments of any nature or kind may be made on any other
Indebtedness.
However, upon receipt of such written notice of default from Lender
(irrespective of whether Lender has agreed to forbear in enforcing its rights in
connection with the occurrence of such default), Junior Creditor agrees not to
xxx for, take or receive payment on account of the Indebtedness or take or
receive any security for any part of the Indebtedness, until all Obligations to
Lender have been fully paid to Lender. Any payments received by Junior Creditor
on account of the Indebtedness after receiving such notice from Lender or that
are otherwise not allowed to be received by Junior Creditor under the terms of
this Agreement shall be held by Junior Creditor in trust for Lender and shall be
immediately turned over to Lender in the form received except for the addition
of any endorsement or assignment necessary to effect the transfer of all rights
therein to Lender, to be credited against the Obligations. Lender is irrevocably
authorized to supply any required endorsement or assignment which may have been
omitted.
9. Junior Creditor agrees that until the earlier of (1) the date on
which all of the Obligations have been paid in full or (2) the expiration of the
Standstill Period (the earlier to occur of such dates is referred to as the
"Enforcement Date"), it will at no time take possession of any collateral
securing the Indebtedness or the Obligations, or foreclose or begin enforcement
of its rights against such collateral or take any other action of any nature or
kind with respect to such collateral, or institute any litigation to collect the
Co-Marketing Termination Fee without the prior written consent of Lender, which
may be granted or withheld in Lender's sole discretion. "Standstill Period"
means the period commencing on the date of this Agreement and ending on the date
that is 120 days after the date on which the Co-Marketing Termination Fee is due
in accordance with the terms of the Co-Marketing Agreement.
10. Junior Creditor must give simultaneous notice to NBD at the
address provided below under NBD's signature line in this Agreement of any
notices, correspondence, or other
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communication between Junior Creditor and Borrower regarding the Co-Marketing
Agreement (other than usual and customary business communications) or the
Co-Marketing Termination Fee including, without limitation, any of the foregoing
relating to facts and circumstances under which the Co-Marketing Termination Fee
may become payable. If any Borrower defaults on the Indebtedness, the Junior
Creditor shall give Lender written notice of the default. However, regardless of
any Borrower's default on the Indebtedness, until the Enforcement Date Junior
Creditor will not seek to foreclose or otherwise realize upon any security for
the Indebtedness. Until the Enforcement Date Junior Creditor shall have no right
to foreclose or otherwise realize on any security. Furthermore, until the
Enforcement Date regardless of any Borrower's default on the Indebtedness,
Junior Creditor will not institute any litigation of any nature or kind against
any Borrower or any Borrower's assets or property without the prior written
consent of Lender (which may be granted or withheld in Lender's sole
discretion).
11. Upon any distribution of any of any Obligor's assets in which
Lender has a lien, security interest or mortgage, whether by reason of sale,
reorganization, liquidation, dissolution, arrangement, bankruptcy, receivership,
assignment for the benefit of creditors, foreclosure or otherwise, Lender shall
be entitled to receive payment in full of the Obligations before Junior Creditor
receives any payment on account of the Indebtedness. Without limitation, the
preceding sentence applies to any monies or other things of value obtained by
Junior Creditor after the expiration of the Standstill Period.
12. In the event of any bankruptcy or similar proceedings of any
Borrower, Junior Creditor agrees not to oppose directly or indirectly in any
manner any actions taken or supported by Lender including but not limited to
opposition to use of cash collateral, financing, proceedings by Lender to lift
the automatic stay or otherwise realize on Lender's security interests and to
that end, Junior Creditor shall not take any action in any bankruptcy or similar
proceeding with respect to any of the assets or property of any Borrower without
the prior written consent of Lender. In the event of (a) any insolvency,
bankruptcy, receivership, liquidation, foreclosure, reorganization in
bankruptcy, readjustment, composition or other similar proceeding relating to
any Borrower or its properties, (b) any proceeding for the liquidation,
dissolution or other winding-up of any Borrower, voluntary or involuntary, and
whether or not involving insolvency or bankruptcy proceedings, (c) any general
assignment by any Borrower for the benefit of creditors, or (d) any
distribution, division, marshalling or application of any of the properties or
assets of any Borrower or the proceeds thereof to creditors, voluntary or
involuntary, and whether or not involving legal proceedings, then and in any
such event:
(i) all Obligations shall first be paid in full (including all
principal and interest (including but not limited to interest accruing
after the commencement of any Proceeding) at the rate then specified in
the Credit Agreements, whether or not such interest is an allowable
claim or would constitute a secured claim in any such Proceeding) and
costs and attorneys' fees whether or not such costs and attorneys' fees
are an allowable claim or a secured claim in any Proceeding) before any
payment or distribution of any character, whether in cash, securities
or other property, shall be made on account of or in connection with
any Indebtedness;
(ii) all principal and interest on the Indebtedness shall
forthwith become due and payable, and any payment or distribution of
any character, whether in cash, securities or other property, which
would otherwise (but for the terms hereof) be payable or
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deliverable in respect of any Indebtedness, shall be paid or delivered
directly to Lender, for application to the payment of the Obligations,
until all Obligations shall have been paid in full, and Junior Creditor
irrevocably authorizes, empowers and directs all receivers, trustees,
liquidators, conservators, fiscal agents and others having authority in
the premises to effect all such payments and deliveries.
13. (a) During any period in which an Event of Default exists under
the Credit Agreements, Lender or Lender's representative shall have the right to
act as Junior Creditor's attorney-in-fact to enforce and ensure compliance with
all of the terms hereof and Junior Creditor hereby irrevocably appoints Lender
or Lender's representative as its true and lawful attorney, with full power of
substitution, in the name of Junior Creditor or in the name of Lender, for the
use and exclusive benefit of Lender, without notice to Junior Creditor or any of
its representatives, successors or assigns, to perform such acts and functions
as Lender deems desirable to enforce all of the terms and provisions of this
Agreement including the following acts, at Lender's option, at any time
including at any meeting of the creditors of any Borrower or in connection with
any case or proceeding, whether voluntary or involuntary, for the distribution,
division or application of the assets of any Borrower or the proceeds thereof,
regardless of whether such case or proceeding is for liquidation, dissolution,
winding up of affairs, reorganization or arrangement of any Borrower, or for the
composition of the creditors of any Borrower, in bankruptcy or in connection
with a receivership, or under an assignment for the benefit of creditors of any
Borrower, or otherwise:
(i) to enforce claims comprising the Indebtedness, either in its
own name or in the name of Junior Creditor, by proof of debt, proof of
claim, suit or otherwise;
(ii) to collect any assets of any Borrower distributed, divided or
applied by way of dividend or payment, or any securities issued, on
account of the Indebtedness and to apply the same, or the proceeds of
any realization upon the same that Lender in its discretion elects to
effect, to the Obligations until all of the Obligations (including but
not limited to interest accruing after the commencement of any
Proceeding), at the rate then specified in the Credit Agreements,
whether or not such interest is an allowable claim or would constitute
a secured claim in any such Proceeding) has been paid in full,
rendering any surplus to Junior Creditor if and to the extent permitted
by law;
(iii) to vote claims comprising the Indebtedness to accept or
reject any plan of partial or complete liquidation, reorganization,
arrangement, composition or extension;
(iv) to have full power to act in the place of Junior Creditor in
connection with the Indebtedness;
(v) to take generally any action in connection with any such
meeting, case or proceeding that Junior Creditor would be authorized or
have power to take but for this Agreement.
(vi) NBD agrees it will not use the foregoing power of attorney to
settle, reduce or otherwise compromise the Indebtedness for an amount
less than the full amount thereof unless one or more of the Borrowers
is in a bankruptcy or other similar insolvency proceeding. NBD further
agrees to give Junior Creditor five days prior
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written notice before its settles, reduces or otherwise compromises the
Indebtedness and if Junior Creditor does not agree with such proposed
action, then Junior Creditor may purchase the Obligations without
representation, warranty, or guaranty of any nature or kind, for cash,
at par, and on such other terms and conditions as are mutually
satisfactory to Junior Creditor and NBD.
(b) The foregoing appointment (and all other appointments
contained herein) is coupled with an interest and is irrevocable so long as any
Obligations remain unpaid or unperformed.
(c) Lender's appointment as agent and/or attorney of Junior
Creditor is intended to benefit Lender solely and Lender shall have no duties or
obligations (including but not limited to those generally associated with
agents, attorneys and/or fiduciaries) to Junior Creditor in connection with such
agency and appointment; provided that if Lender acts in Junior Creditor's place
with respect to the Indebtedness, Lender must act in a commercially reasonably
manner as viewed solely from Lender's perspective and not from the Junior
Creditor's perspective. Without limiting the generality of the foregoing, in no
event shall Lender be liable to Junior Creditor for any failure to prove the
Indebtedness, to exercise any right with respect thereto or to collect any sums
or other property payable thereon or on account thereof.
14. If any payment or distribution of any character (whether in cash,
securities, or other property) or any securities shall be received by Junior
Creditor in contravention of any of the terms of this Agreement, such payment or
distribution or security shall be held in trust for the benefit of, and shall
promptly be paid over or delivered and transferred to Lender for application to
the payment of all Obligations remaining unpaid (or, in Lender's sole
discretion, to be held by Lender as security for the Obligations in an amount
equal to 110% of the Obligations (treating for this purpose the full face amount
of each Letter of Credit as an outstanding principal obligation)), to the extent
necessary to pay all such Obligations in full. In the event of the failure of
Junior Creditor to endorse or assign any such payment, distribution or security,
Lender or such Lender's representative is hereby irrevocably authorized to
endorse or assign the same.
15. Junior Creditor shall not, without Lender's prior written consent,
(a) assign (unless the assignee agrees in writing that it is a party to this
Agreement), pledge or subordinate in favor of any other person or entity, any
part of the Indebtedness or any right, claim or interest in the Indebtedness or
in any collateral security (if any) therefor, or (b) prior to the Enforcement
Date commence or join with any other creditor in commencing any bankruptcy,
reorganization, insolvency proceeding or other similar proceeding against any
Borrower; provided that this subparagraph (b) does not apply if Borrowers owe
Junior Creditor more than $500,000 in indebtedness which is in default and which
does not constitute Indebtedness.
16. Lender may at any time, in its sole discretion, renew, extend,
modify or compromise the time of payment of any part of the Obligations or any
other term thereof, extend additional credit to any Borrower (which will
constitute part of the Obligations), modify the rate of interest payable on the
Obligations, waive or release any collateral that may be held as security for
the Obligations whether or not also security for the Indebtedness, release all
or any guarantors of the Obligations, and enter into any agreement with any
Borrower which Lender may deem desirable, without notice to or further assent
from Junior Creditor and without in any way affecting Lender's rights or Junior
Creditor's obligations under this Agreement, except that
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Junior Creditor is entitled to five days prior written notice from NBD of any
such modification or amendment to the Credit Agreements if an Event of Default
exists under the Credit Agreements and to 15 days prior written notice from NBD
of any such change or modification if no Event of Default exists under the
Credit Agreements; provided that Junior Creditor's sole right is to receive
notice of such change or modification and Junior Creditor's consent is not
required with respect to any such change or modification; provided further that
Lender may, in its sole and absolute discretion, without prior notice to Junior
Creditor, make any changes or modifications to the Credit Agreements that waive
any rights, protections, or benefits for Lender thereunder. Junior Creditor may,
but is not required to, cure any Event of Default under the Credit Agreements
that is capable of being cured as follows: (1) within five days of receipt of a
written notice from NBD of default in the case of a payment default and (2)
within 15 days of receipt of a written notice from NBD of Default in the case of
any other Event of Default. Furthermore, the obligations of Junior Creditor and
the subordination and other provisions of this Agreement shall in no way be
affected by any exercise or nonexercise of any right, power or remedy under or
in respect of any Obligations or any instrument or agreement (including the
Credit Agreements) relating thereto, or any waiver, consent, release,
indulgence, extension, renewal, modification, delay or other action, inaction or
omission in respect of any Obligations or any instrument or agreement (including
the Credit Agreements) relating thereto or any security therefor or any guaranty
thereof. NBD agrees that it will not raise interest rates for time periods that
have passed. NBD also agrees to use good faith efforts to give Junior Creditor
notice of any Events of Default that have occurred under the Loan Documents and
that NBD declares, but NBD has no liability or obligation of any nature or kind
to Junior Creditor if it fails to give such notice and, furthermore, any such
notice will not start the Standstill Period running unless NBD expressly so
provides in such written notice.
17. Junior Creditor must type, write or otherwise conspicuously
imprint on each note, document or other instrument evidencing or related to the
Indebtedness the following legend:
RIGHTS OF THE HOLDER TO RECEIVE PAYMENT OF THE CO-MARKETING
TERMINATION FEE ARE SUBJECT AND SUBORDINATE TO THE PRIOR PAYMENT
OF ALL OBLIGATIONS OF THE MAKER TO NBD BANK PURSUANT TO THE TERMS
OF A SUBORDINATION AGREEMENT DATED AS OF AUGUST 3, 1998.
18. NOTICES. Any notice or other communication required or permitted
to be given under this Agreement or any of the Loan Documents must be in writing
and delivered personally, telegraphed, telecopied or telexed, or mailed (by
certified or registered mail or by recognized overnight courier), postage
prepaid, and is deemed given when so delivered personally, telegraphed or
telexed, or if mailed, three days after the date of mailing, addressed as
follows (or to any another address as to which any party so advises the other
parties in writing):
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(a) If to Borrowers: Universal Standard Healthcare, Inc.
00000 Xxxxxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attn: President
With a copy to: Xxxxxx Xxxxxxx PLLC
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxx, Esq.
(b) If to NBD: NBD Bank
00000 Xxxxxxxxxxxx Xxx.
Xxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxx X. Xxxxxx
First Vice President
With a copy to: Xxxxxxxx Xxxxxx Xxxxxxxx and Xxxx
0000 Xxxxx Xxxxxxxx Xxxxxxxx
Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn: Xxxxxxxx X. Xxxxxxxxxxx
(c) If to Junior Creditor: Laboratory Corporation of America
Holdings
Suite 825
0000 Xxx Xxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx, Esq.
With a copy to: Mezzullo & XxXxxxxxxx
Suite 825
0000 Xxx Xxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxx X. Xxxxx, Esq.
19. If at any time any Borrower's payment or payment(s) to Lender or
any part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside, rescinded and/or required to be repaid by Lender to a
trustee, receiver or any other party under any bankruptcy act or code, state or
federal law, common law or equitable doctrine, then to the extent of any sum not
finally retained by Lender, Junior Creditor's obligations to Lender will be
reinstated and this Agreement will remain in full force and effect (or be
reinstated) until full and final payment shall have been made to Lender. If any
action or proceeding seeking such repayment is pending or, in Lender's sole
judgment, threatened, this Agreement will remain in full force and effect
notwithstanding that any Borrower may not then be obligated to Lender. Junior
Creditor agrees to hold in trust for Lender and promptly remit to Lender any
payment(s) received by Junior Creditor after such invalidated, rescinded or
returned payment(s), above
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described, were originally made.
20. Junior Creditor, on its own behalf and on behalf of its
successors and permitted assigns, hereby expressly waives all rights, if any, to
require a marshalling of assets by Lender or to require that Lender first resort
to some or any portion of any collateral securing any Borrower's obligations to
Lender before foreclosing upon, selling or otherwise realizing on any other
portion thereof.
21. This Agreement shall remain in effect and shall be a continuing
subordination until all Obligations to Lender from each Borrower are paid in
full and Lender has given written notice thereof to Junior Creditor. Junior
Creditor represents and warrants that it has not relied and will not rely on any
representation or information of any nature made by or received from Lender or
any of its officers, agents, attorneys or employees with respect to any Borrower
or any other Obligor in deciding to execute this Agreement, except that Junior
Creditor has relied on Section 29 of this Agreement and on the Sixth Amendment.
22. As between Lender and Junior Creditor only, in the event that
there is an express conflict between the terms and provisions of the Credit
Agreements and of this Agreement, the terms and conditions of this Agreement
shall govern and control. As between Lender and Junior Creditor only, in the
event that there is an express conflict between the terms and provisions of the
agreements between Junior Creditor and Borrowers relating to the Indebtedness
and of this Agreement, the terms and conditions of this Agreement shall govern
and control. This Agreement is solely for Lender's and Junior Creditor's benefit
and no other party, including Borrowers or the other Obligors, is intended to be
benefited by this Agreement.
23. Except where the context otherwise requires, each term stated in
either the singular or plural shall include the singular and the plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, feminine and neuter.
24. This Agreement constitutes the entire understanding of Junior
Creditor and Lender regarding the subject matter provided for in this Agreement.
This Agreement may only be modified, amended or supplemented by a writing signed
by both Junior Creditor and Lender.
25. Junior Creditor represents and warrants that it has authority to
enter into this agreement and that the person executing this Agreement on behalf
of Junior Creditor has been authorized and directed to do so. Lender represents
and warrants that it has authority to enter into this Agreement and that person
executing this agreement on behalf of Lender has been authorized and directed to
do so.
26. This Agreement is being entered into among competent persons, who
are experienced in business and represented by counsel, and has been reviewed by
the parties and their counsel. Therefore, any ambiguous language in this
Agreement will not necessarily be construed against any particular party as the
drafter of such language.
27. This Agreement may be executed in counterparts, all of which
together will be deemed an original of this Agreement. Furthermore,
facsimile/telecopy copies of signatures shall be treated as original signatures
for all purposes.
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28. The rights and remedies specified in this Agreement are cumulative
of each other and not exclusive of any rights or remedies Lender would otherwise
have. Neither the failure nor any delay on the part of Lender to exercise any
right, remedy, power or privilege hereunder shall operate as a waiver thereof or
give rise to an estoppel, nor be construed as an agreement to modify the terms
of this Agreement, nor shall any single or partial exercise of any right,
remedy, power or privilege with respect to any occurrence be construed as a
waiver of such right, remedy, power or privilege with respect to any other
occurrence. No notice to or demand on the Junior Creditor not required hereunder
or under any other agreement shall in any event entitle the Junior Creditor to
any other or further notice or demand in similar or other circumstances or
constitute a waiver of the right of Lender or any holder of the Obligations to
any other or further action in any circumstances without notice or demand. No
waiver of any breach of any provision of this Agreement will be deemed a waiver
of any preceding or succeeding breach or of any other provision of this
Agreement. No extension of time for performance of any obligations or acts will
be deemed an extension of the time for performance of any other obligations or
acts. No waiver by a party hereunder shall be effective unless it is in writing
and signed by the party making such waiver, and then only to the extent
specifically stated in such writing.
29. This Agreement shall be governed by and construed according to the
internal laws of the State of Michigan applicable to contracts made and
performed within the State of Michigan, without regard to conflict of laws
principles.
30. NBD states, without investigation or due diligence, that after
giving effect to the Sixth Amendment and assuming that Obligors comply with all
of the terms and conditions of the Sixth Amendment, it is unaware of any Events
of Defaults or defaults under the Credit Agreements and that the Credit
Agreements are in full force and effect.
31. In various places in this Agreement the phrase "payment in full
of the Obligations" or other similar wording is used. Given that a portion of
the Obligations consist of contingent reimbursement obligations with respect to
the Letters of Credit, the phrase "payment in full of the Obligations" and other
similar phrases mean, in addition to their ordinary meaning, that the
beneficiaries of all Letters of Credit have returned all such Letters of Credit
to NBD undrawn upon and all such Letters of Credit have been cancelled and
terminated.
32. Given that a portion of the collateral for the Indebtedness (as
well as for the Obligations) consists of the stock certificates, copies of which
are attached to this Agreement as Exhibit A (the "Stock Certificates"), that are
in NBD's possession and in which a security interest may only be perfected
through possession, NBD agrees to act as Junior Creditor's agent for the sole
purpose of perfecting Junior Creditor's security interest in the Stock
Certificates, which is subordinated under the terms of this Agreements. NBD
continues to hold the Stock Certificates to perfect its lien. NBD makes no
representation, warranty, or guaranty of any nature or kind that NBD's
possession of the Stock Certificates is sufficient to perfect Junior Creditor's
security interest therein and has no liability of any nature or kind if for any
reason Junior Creditor's lien and security interest in the Stock Certificates is
unperfected. Furthermore, NBD's sole duty to Junior Creditor with respect to the
agency created with respect to the Stock Certificates, and with respect to the
Stock Certificates, is to deliver physical possession of the originals thereof
to an agent of Junior Creditor when all of the Obligations have been paid in
full and the Credit Agreements have been terminated in writing by Lender. If
Junior Creditor does not default under the terms of this Agreement, then NBD
agrees that it will not terminate the
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agency created under this Paragraph 32 until the Stock Certificates have been
delivered to Junior Creditor.
33. Junior Creditor and USML are parties to an Indemnification
Agreement dated the same date as this Agreement and an Indemnification Security
Agreement, also dated the same date as this agreement (collectively, the
"Indemnification Agreements"). Junior Creditor represents and warrants that none
of the collateral in which NBD holds a security interest secures any obligations
under the Indemnification Agreements. Based on this representation and warranty
the terms and conditions of this Agreement do not apply to the Indemnification
Agreements. If in the future any collateral in which NBD holds a lien or
security interest on is collateral for any of the obligations under the
Indemnification Agreements, then this Agreement applies to the Indemnification
Agreements.
34. WAIVER OF BOND AND SUBMISSION TO JURISDICTION. ANY JUDICIAL
PROCEEDING AGAINST THE JUNIOR CREDITOR BROUGHT BY LENDER WITH RESPECT TO ANY
TERM OR CONDITION OF THIS AGREEMENT, OR ANY OTHER PRESENT OR FUTURE AGREEMENT
BETWEEN JUNIOR CREDITOR AND LENDER MAY BE BROUGHT BY LENDER IN A COURT OF
COMPETENT JURISDICTION IN THE STATE OF MICHIGAN, UNITED STATES OF AMERICA, AND,
BY EXECUTION AND DELIVERY OF THIS AGREEMENT, JUNIOR CREDITOR AND LENDER ACCEPT
FOR THEMSELVES AND IN CONNECTION WITH THEIR RESPECTIVE PROPERTIES, GENERALLY AND
UNCONDITIONALLY, THE NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS, AND
IRREVOCABLY AGREE TO BE BOUND BY ANY FINAL JUDGMENT RENDERED THEREBY IN
CONNECTION WITH THIS AGREEMENT, OR ANY OTHER PRESENT AND FUTURE AGREEMENT
BETWEEN JUNIOR CREDITOR AND LENDER. JUNIOR CREDITOR WAIVES PERSONAL SERVICE OF
ANY AND ALL PROCESS UPON IT, AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS MAY
BE MADE BY MAIL OR MESSENGER DIRECTED TO IT AT ITS ADDRESS SET FORTH IN THIS
AGREEMENT. JUNIOR CREDITOR WAIVES ANY BOND OR SURETY OR SECURITY UPON SUCH BOND
OR SURETY WHICH MIGHT, BUT FOR THIS WAIVER, BE REQUIRED OF LENDER. NOTHING
CONTAINED IN THIS SECTION AFFECTS THE RIGHT OF LENDER TO SERVE LEGAL PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR AFFECT LENDER'S RIGHT TO BRING ANY ACTION
OR PROCEEDING AGAINST JUNIOR CREDITOR OR ITS PROPERTY IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY JUNIOR CREDITOR AGAINST LENDER
INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER OR CLAIM IN ANY WAY ARISING OUT
OF, RELATED TO OR CONNECTED WITH THIS AGREEMENT OR ANY PRESENT OR FUTURE
AGREEMENT BETWEEN JUNIOR CREDITOR AND LENDER, MAY BE BROUGHT ONLY IN A COURT
LOCATED IN THE STATE OF MICHIGAN. JUNIOR CREDITOR WAIVES ANY OBJECTION TO
JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREUNDER OR IN CONNECTION
HEREWITH AND MAY NOT ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE
OR BASED UPON FORUM NON CONVENIENS. JUNIOR CREDITOR OR LENDER MAY FILE AN
ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN
EVIDENCE OF THE WAIVERS AND CONSENTS CONTAINED HEREIN.
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35. WAIVER OF JURY TRIAL. LENDER AND JUNIOR CREDITOR, AFTER
CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL, KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT EITHER OF THEM MAY HAVE TO A TRIAL
BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY
RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED BY THIS
AGREEMENT OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS (WHETHER ORAL OR
WRITTEN), OR ACTIONS OF EITHER OF THEM. NEITHER LENDER NOR JUNIOR CREDITOR SHALL
SEEK TO CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH ACTION IN WHICH A
JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE
OR HAS NOT BEEN WAIVED. THESE PROVISIONS SHALL NOT BE DEEMED TO HAVE BEEN
MODIFIED IN ANY RESPECT OR RELINQUISHED BY EITHER LENDER OR JUNIOR CREDITOR
EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY BOTH OF THEM.
LABORATORY CORPORATION OF
AMERICA HOLDINGS
Security: Subordinated Security Interest in
substantially all of each Borrower's assets,
except for stock in subsidiaries that are
By: /s/ Xxxxxxxx X. Xxxxx subject to governmental licensing.
------------------------------
Name: Xxxxxxxx X. Xxxxx
--------------------
Title:E.V. President
--------------
----------------------------------
----------------------------------
(Address)
BORROWERS' ACKNOWLEDGMENT
Borrowers, on ____________, 1998, acknowledge receiving notice of the
attached Subordination Agreement between Lender and the listed creditor of
Borrowers (the "Junior Creditor") and agree to be bound by all the terms,
provisions and conditions of the Subordination Agreement. The amount of present
indebtedness owing to Junior Creditor is acknowledged to be due and owing as of
the date of the Acknowledgment. The Borrowers further agree that unless Lender's
written consent is received, it will not repay any part of the present or any
future indebtedness (the "Indebtedness"), issue any note or other instrument
evidencing the Indebtedness or grant any collateral security for the
Indebtedness, except as permitted by the terms of the Subordination Agreement.
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UNIVERSAL STANDARD HEALTHCARE, INC.,
formerly known as Universal Standard Medical
Laboratories, Inc., a Michigan corporation
By: /s/ Xxxxxx X. Xxxxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxxxxx
----------------------------
Title: President
--------------------
UNIVERSAL STANDARD HEALTHCARE OF DELAWARE, INC.,
formerly known as Universal Standard Manage Care,
Inc., a Delaware corporation
By: /s/ Xxxx X. Xxx
--------------------------------------
Name: Xxxx X. Xxx
----------------------------
Title: CFO
--------------------
Accepted:
NBD BANK
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Xxxxxxx X. Xxxxxx
First Vice President
00000 Xxxxxxxxxxxx Xxx.
Xxxxxxxxxx, XX 00000
Exhibit A - Stock Certificates of Delaware Managed Care
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