Exhibit 99.8
REFERENCE IS MADE TO THE INTERCREDITOR AGREEMENT DATED AS OF NOVEMBER 15, 2006
(AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME, THE
"INTERCREDITOR AGREEMENT"), BETWEEN GENERAL ELECTRIC CAPITAL CORPORATION, AS
FIRST LIEN AGENT (AS DEFINED THEREIN), AND GENERAL ELECTRIC CAPITAL CORPORATION,
AS SECOND LIEN AGENT (AS DEFINED THEREIN). ANYTHING CONTAINED HEREIN TO THE
CONTRARY NOTWITHSTANDING, THE LIENS AND SECURITY INTERESTS GRANTED TO THE SECOND
LIEN AGENT, FOR THE BENEFIT OF THE SECURED PARTIES, PURSUANT TO THIS AGREEMENT
AND THE EXERCISE OF CERTAIN RIGHTS OR REMEDIES BY THE SECOND LIEN AGENT AND THE
OTHER SECURED PARTIES HEREUNDER ARE SUBJECT TO THE PROVISIONS OF THE
INTERCREDITOR AGREEMENT.
SECOND LIEN SECURITY AGREEMENT
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SECOND LIEN SECURITY AGREEMENT (this "Security Agreement"), dated as of
November 15, 2006, by and among the Grantors identified as such on the signature
pages hereof (each a "GRANTOR" and collectively the "GRANTORS") and GENERAL
ELECTRIC CAPITAL CORPORATION, a Delaware corporation, individually and in its
capacity as Agent for Lenders.
W I T N E S S T H:
- - - - - - - - -
WHEREAS, pursuant to that certain Second Lien Credit Agreement dated as
of the date hereof by and among RadNet Management, Inc. ("BORROWER"), the other
Grantors, Agent and Lenders (including all annexes, exhibits and schedules
thereto, as from time to time amended, restated, supplemented or otherwise
modified, the "CREDIT AGREEMENT"), Lenders have agreed to make the Term Loan C
to Borrower;
WHEREAS, in order to induce Agent and Lenders to enter into the Credit
Agreement and other Loan Documents and to induce Lenders to make the Term Loan C
as provided for in the Credit Agreement, Grantors have agreed to grant a
continuing Lien on the Collateral (as hereinafter defined) to secure the
Obligations;
NOW, THEREFORE, in consideration of the premises and mutual covenants
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. DEFINED TERMS.
(a) All capitalized terms used but not otherwise defined herein have
the meanings given to them in the Credit Agreement or in ANNEX A thereto. All
other terms contained in this Security Agreement, unless the context indicates
otherwise, have the meanings provided for by the Code to the extent the same are
used or defined therein.
(b) "Uniform Commercial Code jurisdiction" means any jurisdiction that
has adopted all or substantially all of Article 9 as contained in the 2005
Official Text of the Uniform Commercial Code, as recommended by the National
Conference of Commissioners on Uniform State Laws and the American Law
Institute, together with any subsequent amendments or modifications to the
Official Text.
2. GRANT OF LIEN.
(a) To secure the prompt and complete payment, performance and
observance of all of the Obligations, each Grantor hereby grants, assigns,
conveys, mortgages, pledges, hypothecates and transfers to Agent, for itself and
the benefit of Lenders, a Lien upon all of its right, title and interest in, to
and under all personal property and other assets, whether now owned by or owing
to, or hereafter acquired by or arising in favor of such Grantor (including
under any trade names, styles or derivations thereof), and whether owned or
consigned by or to, or leased from or to, such Grantor, and regardless of where
located (all of which being hereinafter collectively referred to as the
"Collateral"), including:
(i) all Accounts;
(ii) all Chattel Paper;
(iii) all Documents;
(iv) all General Intangibles (including payment intangibles and
Software);
(v) all Goods (including Inventory, Equipment and Fixtures);
(vi) all Instruments;
(vii) all Investment Property;
(viii) all bank accounts and all deposits therein;
(ix) all money, cash or cash equivalents of any Grantor;
(x) all Supporting Obligations and Letter-of-Credit Rights of
any Grantor;
(xi) the commercial tort claims listed on SCHEDULE I; and
(xii) to the extent not otherwise included, all Proceeds,
tort claims, insurance claims and other rights to payments not otherwise
included in the foregoing and products of the foregoing and all
accessions to, substitutions and replacements for, and rents and profits
of, each of the foregoing.
Notwithstanding the foregoing, the following property of Radiologix, Inc. is
excluded from the Collateral; the deposit account (and all funds and investments
therein) maintained at U.S. Bank, National Association and identified as account
number 00000000, to the extent that such deposit account is funded on the
Closing Date with proceeds of Loans for the purpose of effecting a covenant
defeasance of Radiologix, Inc.'s 10.5% Senior Notes due December 15, 2008 and a
subsequent redemption of such Senior Notes on or prior to December 15, 2006.
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(b) In addition, to secure the prompt and complete payment,
performance and observance of the Obligations and in order to induce Agent and
Lenders as aforesaid, each Grantor hereby grants to Agent, for itself and the
benefit of Lenders, a right of setoff against the property of such Grantor held
by Agent or any Lender, consisting of property described above in SECTION 2(A)
now or hereafter in the possession or custody of or in transit to Agent or any
Lender, for any purpose, including safekeeping, collection or pledge, for the
account of such Grantor, or as to which such Grantor may have any right or
power.
3. AGENT'S AND LENDERS' RIGHTS: LIMITATIONS ON AGENT'S AND LENDERS'
OBLIGATIONS.
(a) It is expressly agreed by Grantors that, anything herein to the
contrary notwithstanding, each Grantor shall remain liable under each of its
Contracts and each of its Licenses to observe and perform all the conditions and
obligations to be observed and performed by it thereunder. Neither Agent nor any
Lender shall have any obligation or liability under any Contract or License by
reason of or arising out of this Security Agreement or the granting herein of a
Lien thereon or the receipt by Agent or any Lender of any payment relating to
any Contract or License pursuant hereto. Neither Agent nor any Lender shall be
required or obligated in any manner to perform or fulfill any of the obligations
of any Grantor under or pursuant to any Contract or License, or to make any
payment, or to make any inquiry as to the nature or the sufficiency of any
payment received by it or the sufficiency of any performance by any party under
any Contract or License, or to present or file any claims, or to take any action
to collect or enforce any performance or the payment of any amounts which may
have been assigned to it or to which it may be entitled at any time or times.
(b) Agent may at any time after an Event of Default has occurred and
is continuing without prior notice to any Grantor, notify Account Debtors and
other Persons obligated on the Collateral that Agent has a security interest
therein, and that payments shall be made directly to Agent. Once any such notice
has been given to any Account Debtor or other Person obligated on the
Collateral, the affected Grantor shall not give any contrary instructions to
such Account Debtor or other Person without Agent's prior written consent.
(c) Agent may at any time in Agent's own name, in the name of a
nominee of Agent or in the name of any Grantor communicate (by mail, telephone,
facsimile or otherwise) with Account Debtors, parties to Contracts and obligors
in respect of Instruments to verify with such Persons, to Agent's satisfaction,
the existence, amount terms of, and any other matter relating to, Accounts,
Instruments, Chattel Paper and/or payment intangibles.
4. REPRESENTATIONS AND WARRANTIES. Each Grantor represents and
warrants that:
(a) Each Grantor has rights in and the power to transfer each item of
the Collateral upon which it purports to xxxxx x Xxxx hereunder free and clear
of any and all Liens other than Permitted Encumbrances.
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(b) No effective security agreement, financing statement, equivalent
security or Lien instrument or continuation statement covering all or any part
of the Collateral is on file or of record in any public office, except such as
may have been filed (i) by any Grantor in favor of Agent pursuant to this
Security Agreement or the other Loan Documents, and (ii) in connection with any
other Permitted Encumbrances.
(c) This Security Agreement is effective to create a valid and
continuing Lien on and, upon the filing of the appropriate financing statements
listed on SCHEDULE II hereto, a perfected Lien in favor of Agent, for itself and
the benefit of Lenders, on the Collateral with respect to which a Lien may be
perfected by filing pursuant to the Code. Such Lien is prior to all other Liens,
except Liens of the First Lien Agent under the First Lien Loan Documents to the
extent provided in the Intercreditor Agreement and other Permitted Encumbrances
that would be prior to Liens in favor of Agent for the benefit of Agent and
Lenders as a matter of law, and is enforceable as such as against any and all
creditors of and purchasers from any Grantor (other than purchasers and lessees
of Inventory in the ordinary course of business and non-exclusive licensees of
General Intangibles in the ordinary course of business). All action by any
Grantor necessary or desirable to protect and perfect such Lien on each item of
the Collateral has been duly taken.
(d) SCHEDULE III hereto lists all Instruments, Letter of Credit Rights
and Chattel Paper of each Grantor. All action by any Grantor necessary or
desirable to protect and perfect the Lien of Agent on each item set forth on
SCHEDULE III (including the delivery of all originals thereof to Agent and the
legending of all Chattel Paper as required by SECTION 5(B) hereof) has been duly
taken. The Lien of Agent, for the benefit of Agent and Lenders, on the
Collateral listed on SCHEDULE III hereto is prior to all other Liens, except
Permitted Encumbrances that would be prior to the Liens in favor of Agent as a
matter of law, and is enforceable as such against any and all creditors of and
purchasers from any Grantor.
(e) Each Grantor's name as it appears in official filings in the state
of its incorporation or other organization, the type of entity of each Grantor
(including corporation, partnership, limited partnership or limited liability
company), organizational identification number issued by each Grantor's state of
incorporation or organization or a statement that no such number has been
issued, each Grantor's state of organization or incorporation, the location of
each Grantor's chief executive office, principal place of business, offices, all
warehouses and premises where Collateral is stored or located, and the locations
of its books and records concerning the Collateral are set forth on SCHEDULE
IV-A through SCHEDULE IV-Z, respectively, hereto. Each Grantor has only one
state of incorporation or organization.
(f) With respect to the Accounts (i) they represent bona fide sales of
Inventory or rendering of services to Account Debtors in the ordinary course of
each Grantor's business and are not evidenced by a judgment, Instrument or
Chattel Paper; (ii) there are no setoffs, claims or disputes existing or
asserted with respect thereto and no Grantor has made any agreement with any
Account Debtor for any extension of time for the payment thereof, any compromise
or settlement for less than the full amount thereof, any release of any Account
Debtor from liability therefor, or any deduction therefrom except a discount or
allowance allowed by such Grantor in the ordinary course of its business for
prompt payment and disclosed to Agent; (iii) to each Grantor's knowledge, there
are no facts, events or occurrences which in any way impair the validity or
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enforceability thereof or could reasonably be expected to reduce the amount
payable thereunder as shown on any Grantor's books and records and any invoices
and statements delivered to Agent and Lenders with respect thereto; (iv) no
Grantor has received any notice of proceedings or actions which are threatened
or pending against any Account Debtor which might result in any adverse change
in such Account Debtor's financial condition; and (v) no Grantor has knowledge
that any Account Debtor is unable generally to pay its debts as they become due.
Further with respect to the Accounts (x) the amounts shown on all invoices and
statements which may be delivered to the Agent with respect thereto are actually
and absolutely owing to such Grantor as indicated thereon and are not in any way
contingent; (y) no payments have been or shall be made thereon except payments
immediately delivered to the applicable Blocked Accounts or the Agent as
required pursuant to the terms of the Credit Agreement; and (z) to each
Grantor's knowledge, all Account Debtors have the capacity to contract.
(g) Intentionally Omitted.
(h) No Grantor has any interest in, or title to, any Patent, Trademark
or Copyright except as set forth in SCHEDULE V hereto. This Security Agreement
is effective to create a valid and continuing Lien on and, upon filing of the
Copyright Security Agreements with the United States Copyright Office and filing
of the Patent Security Agreements and the Trademark Security Agreements with the
United State Patent and Trademark Office, perfected Liens in favor of Agent on
each Grantor' s Patents, Trademarks and Copyrights and such perfected Liens are
enforceable as such as against any and all creditors of and purchasers from any
Grantor. Upon filing of the Copyright Security Agreements with the United States
Copyright Office and filing of the Patent Security Agreements and the Trademark
Security Agreements with the United State Patent and Trademark Office and the
filing of appropriate financing statements listed on SCHEDULE II hereto, all
action necessary or desirable to protect and perfect Agent's Lien on each
Grantor's Patents, Trademarks or Copyrights shall have been duly taken.
(i) All motor vehicles owned by each Grantor are listed on SCHEDULE VI
hereto, by model, model year and vehicle identification number ("VIN").
5. COVENANTS. Each Grantor covenants and agrees with Agent, for the
benefit of Agent and Lenders, that from and after the date of this Security
Agreement and until the Termination Date:
(a) FURTHER ASSURANCES: PLEDGE OF INSTRUMENTS; CHATTEL PAPER.
(i) At any time and from time to time, upon the written request
of Agent and at the sole expense of Grantors, each Grantor shall promptly
and duly execute and deliver any and all such further instruments and
documents and take such further actions as Agent may deem desirable to
obtain the full benefits of this Security Agreement and of the rights and
powers herein granted, including (A) using its best efforts to secure all
consents and approvals necessary or appropriate for the assignment to or
for the benefit of Agent of any License or Contract held by such Grantor
and to enforce the security interests granted hereunder; and (B) filing
any financing or continuation statements under the Code with respect to
the Liens granted hereunder or under any other Loan Document as to those
jurisdictions that are not Uniform Commercial Code jurisdictions.
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(ii) Unless Agent shall otherwise consent in writing (which
consent may be revoked), each Grantor shall deliver to Agent (or First
Lien Agent in accordance with the Intercreditor Agreement) all Collateral
consisting of negotiable Documents, certificated securities, Chattel
Paper and Instruments (in each case, accompanied by stock powers,
allonges or other instruments of transfer executed in blank) promptly
after such Credit Party receives the same.
(iii) Each Grantor shall, in accordance with the terms of the
Credit Agreement, obtain or use its best efforts to obtain waivers or
subordinations of Liens from landlords and mortgagees, and each Credit
Party shall in all instances obtain signed acknowledgements of Agent's
Liens from bailees having possession of any Grantor's Goods that they
hold for the benefit of Agent.
(iv) If required by the terms of the Credit Agreement and not
waived by Agent in writing (which waiver may be revoked), each Grantor
shall obtain authenticated Control Letters from each issuer of
uncertificated securities, securities intermediary, or commodities
intermediary issuing or holding any financial assets or commodities to or
for any Grantor.
(v) In accordance with Annex C to the Credit Agreement, each
Grantor shall obtain a blocked account, lockbox or similar agreement with
each bank or financial institution holding a Deposit Account for such
Grantor.
(vi) Each Grantor that is or becomes the beneficiary of a letter
of credit shall promptly, and in any event within two (2) Business Days
after becoming a beneficiary, notify Agent thereof and enter into a
tri-party agreement with Agent and the issuer and/or confirmation bank
with respect to Letter-of-Credit Rights assigning such Letter-of-Credit
Rights to Agent and directing all payments thereunder to an account of
Agent's choice, all in form and substance reasonably satisfactory to
Agent.
(vii) Each Grantor shall take all steps necessary to grant the
Agent control of all electronic chattel paper in accordance with the Code
and all "transferable records" as defined in each of the Uniform
Electronic Transactions Act and the Electronic Signatures in Global and
National Commerce Act.
(viii) Each Grantor hereby irrevocably authorizes the Agent at any
time and from time to time to file in any filing office in any Uniform
Commercial Code jurisdiction any initial financing statements and
amendments thereto that (a) indicate the Collateral (i) as all assets of
such Grantor or words of similar effect, regardless of whether any
particular asset comprised in the Collateral falls within the scope of
Article 9 of the Code or such jurisdiction, or (ii) as being of an equal
or lesser scope or with greater detail, and (b) contain any other
information required by part 5 of Article 9 of the Code for the
sufficiency or filing office acceptance of any financing statement or
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amendment, including (i) whether such Grantor is an organization, the
type of organization and any organization identification number issued to
such Grantor, and (ii) in the case of a financing statement filed as a
fixture filing or indicating Collateral as as-extracted collateral or
timber to be cut, a sufficient description of real property to which the
Collateral relates. Each Grantor agrees to furnish any such information
to the Agent promptly upon request. Each Grantor also ratifies its
authorization for the Agent to have filed in any Uniform Commercial Code
jurisdiction any initial financing statements or amendments thereto if
filed prior to the date hereof.
(ix) Each Grantor shall promptly, and in any event within two
(2) Business Days after the same is acquired by it, notify Agent of any
commercial tort claim (as defined in the Code) acquired by it and unless
otherwise consented by Agent, such Grantor shall enter into a supplement
to this Security Agreement, granting to Agent a Lien in such commercial
tort claim.
(b) MAINTENANCE OF RECORDS. Grantors shall keep and maintain, at their
own cost and expense, satisfactory and complete records of the Collateral,
including a record of any and all payments received and any and all credits
granted with respect to the Collateral and all other dealings with the
Collateral. Grantors shall xxxx their books and records pertaining to the
Collateral to evidence this Security Agreement and the Liens granted hereby. If
any Grantor retains possession of any Chattel Paper or Instruments with Agent's
consent, such Chattel Paper and Instruments shall be marked with the following
legend: "This writing and the obligations evidenced or secured hereby are
subject to the security interest of General Electric Capital Corporation, as
Agent, for the benefit of Agent and certain Lenders."
(c) COVENANTS REGARDING PATENT, TRADEMARK AND COPYRIGHT COLLATERAL.
(i) Grantors shall notify Agent immediately if they know or
have reason to know that any application or registration relating to any
Patent, Trademark or Copyright (now or hereafter existing) may become
abandoned or dedicated, or of any adverse determination or development
(including the institution of, or any such determination or development
in, any proceeding in the United States Patent and Trademark Office, the
United States Copyright Office or any court) regarding any Grantor's
ownership of any Patent, Trademark or Copyright, its right to register
the same, or to keep and maintain the same.
(ii) In no event shall any Grantor, either itself or through any
agent, employee, licensee or designee, file an application for the
registration of any Patent, Trademark or Copyright with the United States
Patent and Trademark Office, the United States Copyright Office or any
similar office or agency without giving Agent prior written notice
thereof, and, upon request of Agent, Grantor shall execute and deliver
any and all Patent Security Agreements, Copyright Security Agreements or
Trademark Security Agreements as Agent may request to evidence Agent's
Lien on such Patent, Trademark or Copyright, and the General Intangibles
of such Grantor relating thereto or represented thereby.
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(iii) Grantors shall take all actions necessary or requested by
Agent to maintain and pursue each application, to obtain the relevant
registration and to maintain the registration of each of the Patents,
Trademarks and Copyrights (now or hereafter existing), including the
filing of applications for renewal, affidavits of use, affidavits of
noncontestability and opposition and interference and cancellation
proceedings, unless the applicable Grantor shall determine that such
Patent, Trademark or Copyright is not material to the conduct of its
business.
(iv) In the event that any of the Patent, Trademark or Copyright
Collateral is infringed upon, or misappropriated or diluted by a third
party, such Grantor shall comply with Section 5(a)(ix) of this Security
Agreement. Such Grantor shall, unless such Grantor shall reasonably
determine that such Patent, Trademark or Copyright Collateral is in no
way material to the conduct of its business or operations, promptly xxx
for infringement, misappropriation or dilution and to recover any and all
damages for such infringement, misappropriation or dilution, and shall
take such other actions as Agent shall deem appropriate under the
circumstances to protect such Patent, Trademark or Copyright Collateral.
(d) INDEMNIFICATION. In any suit, proceeding or action brought by
Agent or any Lender relating to any Collateral for any sum owing with respect
thereto or to enforce any rights or claims with respect thereto, each Grantor
will save, indemnify and keep Agent and Lenders harmless from and against all
expense (including reasonable attorneys' fees and expenses), loss or damage
suffered by reason of any defense, setoff, counterclaim, recoupment or reduction
of liability whatsoever of the Account Debtor or other Person obligated on the
Collateral, arising out of a breach by any Grantor of any obligation thereunder
or arising out of any other agreement, indebtedness or liability at any time
owing to, or in favor of, such obligor or its successors from such Grantor,
except in the case of Agent or any Lender, to the extent such expense, loss, or
damage is attributable solely to the gross negligence or willful misconduct of
Agent or such Lender as finally determined by a court of competent jurisdiction.
All such obligations of Grantors shall be and remain enforceable against and
only against Grantors and shall not be enforceable against Agent or any Lender.
(e) COMPLIANCE WITH TERMS OF ACCOUNTS, ETC. In all material respects,
each Grantor will perform and comply with all obligations in respect of the
Collateral and all other agreements to which it is a party or by which it is
bound relating to the Collateral.
(f) LIMITATION ON LIENS ON COLLATERAL. No Grantor will create, permit
or suffer to exist, and each Grantor will defend the Collateral against, and
take such other action as is necessary to remove, any Lien on the Collateral
except Permitted Encumbrances, and will defend the right, title and interest of
Agent and Lenders in and to any of such Grantor's rights under the Collateral
against the claims and demands of all Persons whomsoever.
(g) LIMITATIONS ON DISPOSITION. No Grantor will sell, license, lease,
transfer or otherwise dispose of any of the Collateral, or attempt or contract
to do so except as permitted by the Credit Agreement.
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(h) FURTHER IDENTIFICATION OF COLLATERAL. Grantors will, if so
requested by Agent, furnish to Agent, as often as Agent requests, statements and
schedules further identifying and describing the Collateral and such other
reports in connection with the Collateral as Agent may reasonably request, all
in such detail as Agent may specify.
(i) NOTICES. Grantors will advise Agent promptly, in reasonable
detail, (i) of any Lien (other than Permitted Encumbrances) or claim made or
asserted against any of the Collateral, and (ii) of the occurrence of any other
event which would have a material adverse effect on the aggregate value of the
Collateral or on the Liens created hereunder or under any other Loan Document.
(j) GOOD STANDING CERTIFICATES. Not less frequently than once during
each calendar year, each Grantor shall, unless Agent shall otherwise consent,
provide to Agent a certificate of good standing from its state of incorporation
or organization.
(k) NO REINCORPORATION. Without limiting the prohibitions on mergers
involving the Grantors contained in the Credit Agreement, no Grantor shall
reincorporate or reorganize itself under the laws of any jurisdiction other than
the jurisdiction in which it is incorporated or organized as of the date hereof
without the prior written consent of Agent.
(l) TERMINATIONS; AMENDMENTS NOT AUTHORIZED. Each Grantor acknowledges
that it is not authorized to file any financing statement or amendment or
termination statement with respect to any financing statement without the prior
written consent of Agent and agrees that it will not do so without the prior
written consent of Agent, subject to such Grantor's rights under Section
9-509(d)(2) of the Code.
(m) AUTHORIZED TERMINATIONS. Agent will promptly deliver to each
Grantor for filing or authorize each Grantor to prepare and file termination
statements and releases in accordance with SECTION 9.20 of the Credit Agreement.
6. AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT.
On the Closing Date each Grantor shall execute and deliver to Agent a
power of attorney (the "POWER OF ATTORNEY") substantially in the form attached
hereto as Exhibit A. The power of attorney granted pursuant to the Power of
Attorney is a power coupled with an interest and shall be irrevocable until the
Termination Date. The powers conferred on Agent, for the benefit of Agent and
Lenders, under the Power of Attorney are solely to protect Agent's interests
(for the benefit of Agent and Lenders) in the Collateral and shall not impose
any duty upon Agent or any Lender to exercise any such powers. Agent agrees that
(a) except for the powers granted in clause (h) of the Power of Attorney, it
shall not exercise any power or authority granted under the Power of Attorney
unless an Event of Default has occurred and is continuing, and (b) Agent shall
account for any moneys received by Agent in respect of any foreclosure on or
disposition of Collateral pursuant to the Power of Attorney provided that none
of Agent or any Lender shall have any duty as to any Collateral, and Agent and
Lenders shall be accountable only for amounts that they actually receive as a
result of the exercise of such powers. NONE OF AGENT, LENDERS OR THEIR
RESPECTIVE AFFILIATES, OFFICERS, DIRECTORS, EMPLOYEES, AGENTS OR REPRESENTATIVES
SHALL BE RESPONSIBLE TO ANY GRANTOR FOR ANY ACT OR FAILURE TO ACT UNDER ANY
POWER OF ATTORNEY OR OTHERWISE, EXCEPT IN RESPECT OF DAMAGES ATTRIBUTABLE SOLELY
TO THEIR OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT AS FINALLY DETERMINED BY A
COURT OF COMPETENT JURISDICTION, NOR FOR ANY PUNITIVE, EXEMPLARY, INDIRECT OR
CONSEQUENTIAL DAMAGES.
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7. REMEDIES: RIGHTS UPON DEFAULT.
(a) In addition to all other rights and remedies granted to it under
this Security Agreement, the Credit Agreement, the other Loan Documents and
under any other instrument or agreement securing, evidencing or relating to any
of the Obligations, if any Event of Default shall have occurred and be
continuing, Agent may, subject to the terms of the Intercreditor Agreement,
exercise all rights and remedies of a secured party under the Code. Without
limiting the generality of the foregoing, and subject to the terms of the
Intercreditor Agreement, each Grantor expressly agrees that in any such event
Agent, without demand of performance or other demand, advertisement or notice of
any kind (except the notice specified below of time and place of public or
private sale) to or upon such Grantor or any other Person (all and each of which
demands, advertisements and notices are hereby expressly waived to the maximum
extent permitted by the Code and other applicable law), may forthwith enter upon
the premises of such Grantor where any Collateral is located through self-help,
without judicial process, without first obtaining a final judgment or giving
such Grantor or any other Person notice and opportunity for a hearing on Agent's
claim or action and may collect, receive, assemble, process, appropriate and
realize upon the Collateral, or any part thereof, and may forthwith sell, lease,
license, assign, give an option or options to purchase, or sell or otherwise
dispose of and deliver said Collateral (or contract to do so), or any part
thereof, in one or more parcels at a public or private sale or sales, at any
exchange at such prices as it may deem acceptable, for cash or on credit or for
future delivery without assumption of any credit risk. Agent or any Lender shall
have the right upon any such public sale or sales and, to the extent permitted
by law, upon any such private sale or sales, to purchase for the benefit of
Agent and Lenders, the whole or any part of said Collateral so sold, free of any
right or equity of redemption, which equity of redemption each Grantor hereby
releases. Such sales may be adjourned and continued from time to time with or
without notice. Agent shall have the right to conduct such sales on any
Grantor's premises or elsewhere and shall have the right to use any Grantor's
premises without charge for such time or times as Agent deems necessary or
advisable.
If any Event of Default shall have occurred and be continued, each
Grantor further agrees, at Agent's request, to assemble the Collateral and make
it available to Agent at a place or places designated by Agent which are
reasonably convenient to Agent and such Grantor, whether at such Grantor's
premises or elsewhere. Until Agent is able to effect a sale, lease, or other
disposition of Collateral, Agent shall have the right to hold or use Collateral,
or any part thereof, to the extent that it deems appropriate for the purpose of
preserving Collateral or its value or for any other purpose deemed appropriate
by Agent. Agent shall have no obligation to any Grantor to maintain or preserve
the rights of such Grantor as against third parties with respect to Collateral
while Collateral is in the possession of Agent. Agent may, if it so elects, seek
the appointment of a receiver or keeper to take possession of Collateral and to
enforce any of Agent's remedies (for the benefit of Agent and Lenders), with
respect to such appointment without prior notice or hearing as to such
appointment. Subject to the terms of the Intercreditor Agreement, Agent shall
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apply the net proceeds of any such collection, recovery, receipt, appropriation,
realization or sale to the Obligations as provided in the Credit Agreement, and
only after so paying over such net proceeds, and after the payment by Agent of
any other amount required by any provision of law, need Agent account for the
surplus, if any, to any Grantor. To the maximum extent permitted by applicable
law, each Grantor waives all claims, damages, and demands against Agent or any
Lender arising out of the repossession, retention or sale of the Collateral
except such as arise solely out of the gross negligence or willful misconduct of
Agent or such Lender as finally determined by a court of competent jurisdiction.
Each Grantor agrees that ten (10) days prior notice by Agent of the time and
place of any public sale or of the time after which a private sale may take
place is reasonable notification of such matters. Grantors shall remain liable
for any deficiency if the proceeds of any sale or disposition of the Collateral
are insufficient to pay all Obligations, including any attorneys' fees and other
expenses incurred by Agent or any Lender to collect such deficiency.
(b) Except as otherwise specifically provided herein, each Grantor
hereby waives presentment, demand, protest or any notice (to the maximum extent
permitted by applicable law) of any kind in connection with this Security
Agreement or any Collateral.
(c) To the extent that applicable law imposes duties on the Agent to
exercise remedies in a commercially reasonable manner, each Grantor acknowledges
and agrees that it is not commercially unreasonable for the Agent (i) to fail to
incur expenses reasonably deemed significant by the Agent to prepare Collateral
for disposition or otherwise to complete raw material or work in process into
finished goods or other finished products for disposition, (ii) to fail to
obtain third party consents for access to Collateral to be disposed of, or to
obtain or, if not required by other law, to fail to obtain governmental or third
party consents for the collection or disposition of Collateral to be collected
or disposed of, (iii) to fail to exercise collection remedies against Account
Debtors or other Persons obligated on Collateral or to remove Liens on or any
adverse claims against Collateral, (iv) to exercise collection remedies against
Account Debtors and other Persons obligated on Collateral directly or through
the use of collection agencies and other collection specialists, (v) to
advertise dispositions of Collateral through publications or media of general
circulation, whether or not the Collateral is of a specialized nature, (vi) to
contact other Persons, whether or not in the same business as the Grantor, for
expressions of interest in acquiring all or any portion of such Collateral,
(vii) to hire one or more professional auctioneers to assist in the disposition
of Collateral, whether or not the Collateral is of a specialized nature, (viii)
to dispose of Collateral by utilizing internet sites that provide for the
auction of assets of the types included in the Collateral or that have the
reasonable capacity of doing so, or that match buyers and sellers of assets,
(ix) to dispose of assets in wholesale rather than retail markets, (x) to
disclaim disposition warranties, such as title, possession or quiet enjoyment,
(xi) to purchase insurance or credit enhancements to insure the Agent against
risks of loss, collection or disposition of Collateral or to provide to the
Agent a guaranteed return from the collection or disposition of Collateral, or
(xii) to the extent deemed appropriate by the Agent, to obtain the services of
other brokers, investment bankers, consultants and other professionals to assist
the Agent in the collection or disposition of any of the Collateral. Each
Grantor acknowledges that the purpose of this Section 7(c) is to provide
non-exhaustive indications of what actions or omissions by the Agent would not
be commercially unreasonable in the Agent's exercise of remedies against the
Collateral and that other actions or omissions by the Agent shall not be deemed
commercially unreasonable solely on account of not being indicated in this
Section 7(c). Without limitation upon the foregoing, nothing contained in this
Section 7(c) shall be construed to grant any rights to any Grantor or to impose
any duties on Agent that would not have been granted or imposed by this Security
Agreement or by applicable law in the absence of this Section 7(c).
11
(d) Neither the Agent nor the Lenders shall be required to make any
demand upon, or pursue or exhaust any of their rights or remedies against, any
Grantor, any other obligor, guarantor, pledgor or any other Person with respect
to the payment of the Obligations or to pursue or exhaust any of their rights or
remedies with respect to any Collateral therefor or any direct or indirect
guarantee thereof. Neither the Agent nor the Lenders shall be required to
marshal the Collateral or any guarantee of the Obligations or to resort to the
Collateral or any such guarantee in any particular order, and all of its and
their rights hereunder or under any other Loan Document shall be cumulative. To
the extent it may lawfully do so, each Grantor absolutely and irrevocably waives
and relinquishes the benefit and advantage of, and covenants not to assert
against the Agent or any Lender, any valuation, stay, appraisement, extension,
redemption or similar laws and any and all rights or defenses it may have as a
surety now or hereafter existing which, but for this provision, might be
applicable to the sale of any Collateral made under the judgment, order or
decree of any court, or privately under the power of sale conferred by this
Security Agreement, or otherwise.
8. GRANT OF LICENSE TO USE INTELLECTUAL PROPERTY COLLATERAL. For the
purpose of enabling Agent to exercise rights and remedies under SECTION 7 hereof
(including, without limiting the terms of SECTION 7 hereof, in order to take
possession of, hold, preserve, process, assemble, prepare for sale, market for
sale, sell or otherwise dispose of Collateral) at such time as Agent shall be
lawfully entitled to exercise such rights and remedies, each Grantor hereby
grants to Agent, for the benefit of Agent and Lenders, an irrevocable,
nonexclusive license (exercisable without payment of royalty or other
compensation to such Grantor) to use, license or sublicense any Intellectual
Property now owned or hereafter acquired by such Grantor, and wherever the same
may be located, and including in such license access to all media in which any
of the licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof.
9. LIMITATION ON AGENT'S AND LENDERS' DUTY IN RESPECT OF COLLATERAL.
Agent and each Lender shall use reasonable care with respect to the Collateral
in its possession or under its control. Neither Agent nor any Lender shall have
any other duty as to any Collateral in its possession or control or in the
possession or control of any agent or nominee of Agent or such Lender, or any
income thereon or as to the preservation of rights against prior parties or any
other rights pertaining thereto.
10. REINSTATEMENT. This Security Agreement shall remain in full force
and effect and continue to be effective should any petition be filed by or
against any Grantor for liquidation or reorganization, should any Grantor become
insolvent or make an assignment for the benefit of any creditor or creditors or
should a receiver or trustee be appointed for all or any significant part of any
Grantor's assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Obligations, or any
part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or
must otherwise be restored or returned by any obligee of the Obligations,
whether as a "voidable preference," "fraudulent conveyance," or otherwise, all
as though such payment or performance had not been made. In the event that any
payment, or any part thereof, is rescinded, reduced, restored or returned, the
Obligations shall be reinstated and deemed reduced only by such amount paid and
not so rescinded, reduced, restored or returned.
12
11. NOTICES. Except as otherwise provided herein, whenever it is
provided herein that any notice, demand, request, consent, approval, declaration
or other communication shall or may be given to or served upon any of the
parties by any other party, or whenever any of the parties desires to give and
serve upon any other party any communication with respect to this Security
Agreement, each such notice, demand, request, consent, approval, declaration or
other communication shall be in writing and shall be given in the manner, and
deemed received, as provided for in the Credit Agreement.
12. SEVERABILITY. Whenever possible, each provision of this Security
Agreement shall be interpreted in a manner as to be effective and valid under
applicable law, but if any provision of this Security Agreement shall be
prohibited by or invalid under applicable law, such provision shall be
ineffective to the extent of such prohibition or invalidity without invalidating
the remainder of such provision or the remaining provisions of this Security
Agreement. This Security Agreement is to be read, construed and applied together
with the Credit Agreement and the other Loan Documents which, taken together,
set forth the complete understanding and agreement of Agent, Lenders and
Grantors with respect to the matters referred to herein and therein.
13. NO WAIVER; CUMULATIVE REMEDIES. Neither Agent nor any Lender shall
by any act, delay, omission or otherwise be deemed to have waived any of its
rights or remedies hereunder, and no waiver shall be valid unless in writing,
signed by Agent and then only to the extent therein set forth. A waiver by Agent
of any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which Agent would otherwise have had on any future
occasion. No failure to exercise nor any delay in exercising on the part of
Agent or any Lender, any right, power or privilege hereunder, shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, power or
privilege hereunder preclude any other or future exercise thereof or the
exercise of any other right, power or privilege. The rights and remedies
hereunder provided are cumulative and may be exercised singly or concurrently,
and are not exclusive of any rights and remedies provided by law. None of the
terms or provisions of this Security Agreement may be waived, altered, modified
or amended except by an instrument in writing, duly executed by Agent and
Grantors.
14. LIMITATION BY LAW. All rights, remedies and powers provided in
this Security Agreement may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law, and all the provisions
of this Security Agreement are intended to be subject to all applicable
mandatory provisions of law that may be controlling and to be limited to the
extent necessary so that they shall not render this Security Agreement invalid,
unenforceable, in whole or in part, or not entitled to be recorded, registered
or filed under the provisions of any applicable law.
15. TERMINATION OF THIS SECURITY AGREEMENT. Subject to SECTION 10
hereof, this Security Agreement shall terminate upon the Termination Date.
13
16. SUCCESSORS AND ASSIGNS. This Security Agreement and all
obligations of Grantors hereunder shall be binding upon the successors and
assigns of each Grantor (including any debtor-in-possession on behalf of such
Grantor) and shall, together with the rights and remedies of Agent, for the
benefit of Agent and Lenders, hereunder, inure to the benefit of Agent and
Lenders, all future holders of any instrument evidencing any of the Obligations
and their respective successors and assigns. No sales of participations, other
sales, assignments, transfers or other dispositions of any agreement governing
or instrument evidencing the Obligations or any portion thereof or interest
therein shall in any manner impair the Lien granted to Agent, for the benefit of
Agent and Lenders, hereunder. No Grantor may assign, sell, hypothecate or
otherwise transfer any interest in or obligation under this Security Agreement.
17. COUNTERPARTS. This Security Agreement may be authenticated in any
number of separate counterparts, each of which shall collectively and separately
constitute one agreement. This Security Agreement may be authenticated by manual
signature, facsimile or, if approved in writing by Agent, electronic means, all
of which shall be equally valid.
18. GOVERNING LAW. EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ANY OF
=THE LOAN DOCUMENTS, IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, THIS SECURITY AGREEMENT AND THE OBLIGATIONS ARISING
HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND PERFORMED IN
THAT STATE, AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. EACH
GRANTOR HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN
NEW YORK COUNTY, CITY OF NEW YORK, NEW YORK, SHALL HAVE EXCLUSIVE JURISDICTION
TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN GRANTORS, AGENT AND LENDERS
PERTAINING TO THIS SECURITY AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS OR TO
ANY MATTER ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS, PROVIDED, THAT AGENT, LENDERS AND GRANTORS ACKNOWLEDGE
THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED
OUTSIDE OF NEW YORK COUNTY, AND, PROVIDED, FURTHER, NOTHING IN THIS AGREEMENT
SHALL BE DEEMED OR OPERATE TO PRECLUDE AGENT FROM BRINGING SUIT OR TAKING OTHER
LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER
SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN
FAVOR OF AGENT. EACH GRANTOR EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH
JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH GRANTOR
HEREBY WAIVES ANY OBJECTION WHICH IT MAY HAVE BASED UPON LACK OF PERSONAL
JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT. EACH GRANTOR HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND
OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH
SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED
MAIL ADDRESSED TO SUCH GRANTOR AT THE ADDRESS SET FORTH IN THE CREDIT AGREEMENT
AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE EARLIER OF ACTUAL
RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE U.S. MAILS, PROPER
POSTAGE PREPAID.
14
19. WAIVER OF JURY TRIAL. BECAUSE DISPUTES ARISING IN CONNECTION WITH
COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN
EXPERIENCED AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL
LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT DISPUTES
ARISING HEREUNDER OR RELATING HERETO BE RESOLVED BY A JUDGE APPLYING SUCH
APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF
THE JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO
TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE,
WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, AMONG AGENT, LENDERS, AND
GRANTORS ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP ESTABLISHED IN CONNECTION WITH, THIS SECURITY AGREEMENT OR ANY OF
THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS RELATED HERETO OR THERETO.
20. SECTION TITLES. The Section titles contained in this Security
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of the agreement between the parties hereto.
21. NO STRICT CONSTRUCTION. The parties hereto have participated
jointly in the negotiation and drafting of this Security Agreement. In the event
an ambiguity or question of intent or interpretation arises, this Security
Agreement shall be construed as if drafted jointly by the parties hereto and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any provisions of this Security Agreement.
22. ADVICE OF COUNSEL. Each of the parties represents to each other
party hereto that it has discussed this Security Agreement and, specifically,
the provisions of SECTION 18 and SECTION 19, with its counsel.
23. BENEFIT OF LENDERS. All Liens granted or contemplated hereby shall
be for the benefit of Agent, individually, and Lenders, and all proceeds or
payments realized from Collateral in accordance herewith shall be applied to the
Obligations in accordance with the terms of the Credit Agreement.
[Signature Page Follows]
15
IN WITNESS WHEREOF, each of the parties hereto has caused this Security
Agreement to be executed and delivered by its duly authorized officer as of the
date first set forth above.
GRANTORS:
RADNET MANAGEMENT, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
PRIMEDEX HEALTH SYSTEMS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
XXXXXXX RADIOLOGY MEDICAL GROUP, III
BY: PRONET IMAGING MEDICAL GROUP, INC.,
ITS GENERAL PARTNER
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
BY: XXXXXXX RADIOLOGY MEDICAL GROUP, INC.,
ITS GENERAL PARTNER
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
XXXXXXX RADIOLOGY MEDICAL GROUP, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
PRONET IMAGING MEDICAL GROUP, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
RADNET SUB, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
SOCAL MR SITE MANAGEMENT, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
RADNET MANAGEMENT I, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
RADNET MANAGEMENT II, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
RADNET MANAGED IMAGING SERVICES, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
DIAGNOSTIC IMAGING SERVICES, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
RADIOLOGIX, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
ADVANCED IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
IDE IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
MID ROCKLAND IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
PACIFIC IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
QUESTAR IMAGING, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
TREASURE COAST IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
COMMUNITY IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
RADIOLOGY AND NUCLEAR MEDICINE IMAGING
PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
VALLEY IMAGING PARTNERS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
QUESTAR DULUTH, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
QUESTAR LOS ALAMITOS, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
QUESTAR VICTORVILLE, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
ROCKY MOUNTAIN OPENSCAN MRI, LLC
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
FRI, INC.
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
GENERAL ELECTRIC CAPITAL CORPORATION,
AS AGENT
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
[Signature Page to Second Lien Security Agreement]
EXHIBIT A
---------
POWER OF ATTORNEY
This Power of Attorney is executed and delivered by ____________________,
a _____________________ corporation ("Grantor") to General Electric Capital
Corporation, a Delaware corporation (hereinafter referred to as "Attorney"), as
Agent for the benefit of Agent and Lenders, under a Second Lien Credit Agreement
and a Second Lien Security Agreement, both dated as of November 15, 2006, and
other related documents (the "Loan Documents"). No person to whom this Power of
Attorney is presented, as authority for Attorney to take any action or actions
contemplated hereby, shall be required to inquire into or seek confirmation from
Grantor as to the authority of Attorney to take any action described below, or
as to the existence of or fulfillment of any condition to this Power of
Attorney, which is intended to grant to Attorney unconditionally the authority
to take and perform the actions contemplated herein, and Grantor irrevocable
waives any right to commence any suit or action, in law or equity, against any
person or entity which acts in reliance upon or acknowledges the authority
granted under this Power of Attorney. The power of attorney granted hereby is
coupled with an interest, and may not be revoked or canceled by Grantor without
Attorney' s written consent.
Grantor hereby irrevocably constitutes and appoints Attorney (and all
officers, employees or agents designated by Attorney), with full power of
substitution, as Grantor's true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of Grantor and in the
name of Grantor or in its own name, from time to time in Attorney's discretion,
to take any and all appropriate action and to execute and deliver any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of the Loan Documents and, without limiting the generality of the
foregoing, Grantor hereby grants to Attorney the power and right, on behalf of
Grantor, without notice to or assent by Grantor, and at any time, to do the
following: (a) change the mailing address of Grantor, open a post office box on
behalf of Grantor, open mail for Grantor, and ask, demand, collect, give
acquittances and receipts for, take possession of, endorse any invoices, freight
or express bills, bills of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications, and notices in connection with any property
of Grantor; (b) effect any repairs to any asset of Grantor, or continue or
obtain any insurance and pay all or any part of the premiums therefor and costs
thereof, and make, settle and adjust all claims under such policies of
insurance, and make all determinations and decisions with respect to such
policies; (c) pay or discharge any taxes, liens, security interests, or other
encumbrances levied or placed on or threatened against Grantor or its property;
(d) defend any suit, action or proceeding brought against Grantor if Grantor
does not defend such suit, action or proceeding or if Attorney believes that
Grantor is not pursuing such defense in a manner that will maximize the recovery
to Attorney, and settle, compromise or adjust any suit, action, or proceeding
described above and, in connection therewith, give such discharges or releases
as Attorney may deem appropriate; (e) file or prosecute any claim, litigation,
suit or proceeding in any court of competent jurisdiction or before any
arbitrator, or take any other action otherwise deemed appropriate by Attorney
for the purpose of collecting any and all such moneys due to Grantor whenever
payable and to enforce any other right in respect of Grantor's property; (f)
cause the certified public accountants then engaged by Grantor to prepare and
deliver to Attorney at any time and from time to time, promptly upon Attorney's
request, the following reports: (1) a reconciliation of all accounts, (2) an
aging of all accounts, (3) trial balances, (4) test verifications of such
accounts as Attorney may request, and (5) the results of each physical
verification of inventory; (g) communicate in its own name with any party to any
Contract with regard to the assignment of the right, title and interest of such
Grantor in and under the Contracts and other matters relating thereto; (h) to
file such financing statements with respect to the Security Agreement, with or
without Grantor's signature, or to file a photocopy of the Security Agreement in
substitution for a financing statement, as the Agent may deem appropriate and to
execute in Grantor's name such financing statements and amendments thereto and
continuation statements which may require the Grantor's signature; and (i)
execute, in connection with any sale provided for in any Loan Document, any
endorsements, assignments or other instruments of conveyance or transfer with
respect to the Collateral and to otherwise direct such sale or resale, all as
though Attorney were the absolute owner of the property of Grantor for all
purposes, and to do, at Attorney's option and Grantor's expense, at any time or
from time to time, all acts and other things that Attorney reasonably deems
necessary to perfect, preserve, or realize upon Grantor's property or assets and
Attorney's Liens thereon, all as fully and effectively as Grantor might do.
Grantor hereby ratifies, to the extent permitted by law, all that said Attorney
shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, this Power of Attorney is executed by Grantor, and
Grantor has caused its seal to be affixed pursuant to the authority of its board
of directors this _______ day of ____________, 2006.
[ GRANTOR ]
-----------------------------------------
By:
--------------------------------------
Name:
------------------------------------
Title:
-----------------------------------
NOTARY PUBLIC CERTIFICATE
-------------------------
On this _____ day of ______________, 2006, [officer's name] who is
personally known to me appeared before me in his/her capacity as the [title] of
[Grantor] ("Grantor") and executed on behalf of Grantor the Power of Attorney in
favor of General Electric Capital Corporation to which this Certificate is
attached.
------------------------------------------
Notary Public
