Exhibit 4.8
EXECUTION VERSION
PLEDGE AGREEMENT
DATED AS OF SEPTEMBER 22, 2005
AMONG
THE LOAN PARTIES FROM TIME TO TIME PARTY HERETO
AND
U.S. BANK NATIONAL ASSOCIATION,
AS COLLATERAL AGENT
TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms............................................... 1
SECTION 1.02 Defined in the UCC.......................................... 1
SECTION 1.03 Additional Definitions...................................... 2
SECTION 1.04 Terms Generally............................................. 8
ARTICLE II
THE SECURITY INTERESTS
SECTION 2.01 Grant of Security Interests................................. 8
SECTION 2.02 Security Interests Absolute................................. 9
SECTION 2.03 Continuing Liability of the Loan Parties.................... 11
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01 Title to Collateral......................................... 11
SECTION 3.02 Validity, Perfection and Priority of Security Interests..... 11
SECTION 3.03 Collateral.................................................. 12
SECTION 3.04 No Consents................................................. 12
ARTICLE IV
COVENANTS
SECTION 4.01 Delivery of Collateral...................................... 13
SECTION 4.02 Delivery of Perfection Certificate; Filing of Financing
Statements and Delivery of Search Reports............................. 13
SECTION 4.03 Further Assurances.......................................... 13
SECTION 4.04 Additional Collateral....................................... 14
SECTION 4.05 Information Regarding Collateral............................ 14
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ARTICLE V
DISTRIBUTIONS ON COLLATERAL; VOTING
SECTION 5.01 Right to Receive Distributions on Collateral; Voting........ 14
ARTICLE VI
GENERAL AUTHORITY; REMEDIES
SECTION 6.01 General Authority........................................... 17
SECTION 6.02 Remedies upon Event of Default.............................. 18
SECTION 6.03 Securities Act.............................................. 19
SECTION 6.04 Other Rights of the Collateral Agent........................ 19
SECTION 6.05 Limitation on Duty of Collateral Agent in Respect of
Collateral............................................................ 20
SECTION 6.06 Waiver and Estoppel......................................... 20
SECTION 6.07 Application of Proceeds..................................... 20
ARTICLE VII
THE COLLATERAL AGENT
SECTION 7.01 Concerning the Collateral Agent............................. 21
SECTION 7.02 Appointment of Co-Collateral Agent.......................... 21
SECTION 7.03 Appointment of Sub-Agents................................... 22
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Notices..................................................... 22
SECTION 8.02 No Waivers; Non-Exclusive Remedies.......................... 22
SECTION 8.03 Compensation and Expenses of the Collateral Agent;
Indemnification....................................................... 23
SECTION 8.04 Enforcement................................................. 24
SECTION 8.05 Amendments and Waivers...................................... 24
SECTION 8.06 Successors and Assigns...................................... 25
SECTION 8.07 Governing Law............................................... 25
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SECTION 8.08 Limitation of Law; Severability............................. 25
SECTION 8.09 Counterparts; Effectiveness................................. 25
SECTION 8.10 Additional Loan Parties..................................... 25
SECTION 8.11 Termination; Release of Loan Parties........................ 26
SECTION 8.12 Entire Agreement............................................ 27
SCHEDULES:
Schedule I - List of Pledged Shares
Schedule II - List of Pledged Notes
Schedule III - List of Pledged LLC Interests
Schedule IV - List of Pledged Partnership Interests
Schedule 3.04 - Consents
EXHIBITS:
Exhibit A - Form of Issuer Control Agreement
Exhibit B - Form of Securities Account Control Agreement
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PLEDGE AGREEMENT dated as of September 22, 2005 (as amended, modified
or supplemented from time to time, this "AGREEMENT") among the LOAN PARTIES from
time to time party hereto and U.S. BANK NATIONAL ASSOCIATION, as Collateral
Agent for the benefit of the Finance Parties referred to herein (together with
its successor or successors in such capacity, the "COLLATERAL AGENT").
InSight Health Services Corp. ("INSIGHT") intends to issue Senior
Secured Floating Rate Notes due 2011 (together with any Additional Notes (as
defined in the Indenture) and any Exchange Notes (as defined in the Indenture),
and as amended, restated, supplemented or modified from time to time, the
"SENIOR SECURED NOTES") pursuant to an Indenture dated as of the date hereof (as
amended, restated, supplemented or modified from time to time and including any
agreement extending the maturity of, refinancing or otherwise restructuring all
or any portion of the obligations of InSight under such Indenture or any
successor agreement, the "INDENTURE") among InSight and U.S. Bank National
Association, as Trustee (together with its successor or successors in such
capacity, the "TRUSTEE"). The obligations of InSight under and in respect of the
Senior Secured Notes will be guaranteed by InSight Health Services Holdings
Corp. ("HOLDINGS"), each of the parties listed on the signature pages hereto as
"Subsidiary Guarantors" and all other direct and indirect wholly-owned domestic
subsidiaries of Holdings that become a party hereto pursuant to Section 8.10
hereof (collectively, the "SUBSIDIARY GUARANTORS" and, together with Holdings,
"GUARANTORS"). Holdings, InSight and the Subsidiary Guarantors are herein
referred to individually as a "LOAN PARTY" and, collectively, as the "LOAN
PARTIES".
The Indenture requires the Loan Parties to secure their obligations
under the Senior Secured Notes and their obligations under any guaranties
thereof through the grant of a first lien security interest over the Collateral
(as defined below). The Indenture further requires that such security interests
in the Collateral be granted pursuant to security documents to a collateral
agent acting for the benefit of the holders from time to time of the Senior
Secured Notes. Consequently, the Trustee and the Collateral Agent have entered
into a Collateral Agency Agreement dated as of the date hereof (as amended,
modified or supplemented from time to time, the "COLLATERAL AGENCY AGREEMENT")
which, among other things, governs certain actions of the Trustee and the
Collateral Agent in connection with the Senior Secured Notes and the Collateral,
respectively.
Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms. Terms defined in the introductory section
hereof have the respective meanings set forth therein. Capitalized terms defined
in the Indenture and not otherwise defined herein have, as used herein, the
respective meanings provided for therein.
SECTION 1.02 Defined in the UCC. Unless otherwise defined herein or
the context otherwise requires, the following terms, together with any
uncapitalized terms used
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herein which are defined in the UCC have the respective meanings provided for in
the UCC: (i) Certificated Security; (ii) Financial Asset; (iii) Investment
Property; (iv) Payment Intangibles; (v) Proceeds; (vi) Securities Account; (vii)
Securities Intermediary; (viii) Security; (ix) Security Certificate; and (x)
Uncertificated Security.
SECTION 1.03 Additional Definitions. The following additional terms,
as used herein, have the following respective meanings:
"CAPITAL STOCK" has the meaning given to it in the Indenture.
"COLLATERAL" has the meaning set forth in Section 2.01.
"COLLATERAL AGENT" means U.S. Bank National Association, in its
capacity as collateral agent for the Finance Parties, and its successor or
successors in such capacity.
"DEFAULT" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"DELIVERY" when used with respect to Collateral means:
(i) in the case of Collateral constituting Certificated Securities,
transfer thereof to the Collateral Agent or its nominee or custodian by physical
delivery to the Collateral Agent or its nominee or custodian, such Collateral to
be in suitable form for transfer by delivery, or accompanied by duly executed
instruments of transfer or assignment in blank;
(ii) in the case of Collateral constituting Uncertificated Securities,
(A) registration thereof on the books and records of the issuer thereof in the
name of the Collateral Agent or its nominee or custodian (who may not be a
Securities Intermediary) or (B) the execution and delivery by the issuer thereof
of an effective agreement, substantially in the form of Exhibit A hereto,
pursuant to which such issuer agrees that it will comply with instructions
originated by the Collateral Agent or such nominee or custodian without further
consent of the registered owner of such Collateral or any other Person;
(iii) in the case of Collateral constituting Security Entitlements or
other Financial Assets deposited in or credited to a Securities Account, (A)
completion of all actions necessary to constitute the Collateral Agent or its
nominee or custodian the entitlement holder with respect to each such Security
Entitlement or (B) the execution and delivery by the relevant Securities
Intermediary of an effective agreement, substantially in the form of Exhibit B
hereto, pursuant to which such Securities Intermediary agrees to comply with all
entitlement orders originated by the Collateral Agent or such nominee or
custodian without further consent by the relevant entitlement holder or any
other Person;
(iv) in the case of LLC Interests and Partnership Interests issued by
one or more Loan Parties which do not constitute Securities, (A) compliance with
the provisions of clause (i) above for each such item of Collateral which is
represented by a certificate and (B) compliance with the provisions of clause
(ii) above for each such item of Collateral which is not evidenced by a
certificate;
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(v) in the case of Collateral which constitute Instruments, transfer
thereof to the Collateral Agent or its nominee or custodian by physical delivery
to the Collateral Agent or its nominee or custodian indorsed to, or registered
in the name of, the Collateral Agent or its nominee or custodian or indorsed in
blank;
(vi) in the case of cash, transfer thereof to the Collateral Agent or
its nominee or custodian by physical delivery to the Collateral Agent or its
nominee or custodian; and
(vii) in each case such additional or alternative procedures as may
hereafter become appropriate to grant control of, or otherwise perfect a
security interest in, any Collateral in favor of the Collateral Agent or its
nominee or custodian, consistent with changes in applicable law or regulations
or the interpretation thereof.
"EVENT OF DEFAULT" means an "Event of Default" as defined in the
Indenture.
"FAIR MARKET VALUE" has the meaning given to it in the Indenture.
"FEDERAL SECURITIES LAWS" has the meaning set forth in Section 6.03(a)
of this Agreement.
"FINANCE PARTY" means each Noteholder, the Trustee, the Collateral
Agent, each Indemnitee and their respective successors and assigns, and "Finance
Parties" means any two or more of them, collectively.
"GENERAL INTANGIBLES" means all "general intangibles" (as defined in
the UCC), including, without limitation, (i) all Payment Intangibles and other
obligations and indebtedness owing to any Loan Party in respect of Collateral
and (ii) all interests in limited liability companies and/or partnerships which
interests do not constitute Securities.
"GOVERNMENTAL AUTHORITY" means any nation or government, any state or
other political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
"GUARANTEE" means the guarantee by any Guarantor of the Note
Obligations.
"INDEMNITEE" has the meaning set forth in Section 8.03(c) of this
Agreement.
"INSTRUMENTS" means:
(i) the promissory notes described on Schedule II hereto, as such
Schedule may be amended, supplemented or modified from time to time (the
"PLEDGED NOTES"), and all interest, distributions, cash, instruments and other
property, income, profits and proceeds from time to time received or receivable
or otherwise made upon or distributed in respect of or in exchange for any or
all of the Pledged Notes;
(ii) all additional or substitute promissory notes from time to time
issued to or otherwise acquired by any Loan Party in any manner in respect of
Pledged Notes, and all
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interest, distributions, cash, instruments and other property, income, profits
and proceeds from time to time received or receivable or otherwise made upon or
distributed in respect of such additional or substitute notes;
(iii) all promissory notes, bankers' acceptances, commercial paper,
negotiable certificates of deposit and other obligations constituting
"instruments" within the meaning of the UCC; and
(iv) to the extent not otherwise included in the foregoing, all cash
and non-cash Proceeds thereof.
"ISSUE DATE" means September 22, 2005.
"LAW" means, collectively, all international, foreign, Federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, licenses, authorizations and
permits of, and agreements with, any Governmental Authority.
"LLC INTERESTS" means:
(i) the limited liability company membership interests described on
Schedule III hereto, as such Schedule may be amended, supplemented or modified
from time to time (the "PLEDGED LLC INTERESTS"), and all dividends,
distributions, cash, instruments and other property, income, profits and
proceeds from time to time received or receivable or otherwise made upon or
distributed in respect of or in exchange for any or all of the Pledged LLC
Interests;
(ii) all additional or substitute limited liability company membership
interests from time to time issued to or otherwise acquired by any Loan Party in
any manner in respect of Pledged LLC Interests, and all dividends,
distributions, cash, instruments and other property, income, profits and
proceeds from time to time received or receivable or otherwise made upon or
distributed in respect of such additional or substitute membership interests;
(iii) all right, title and interest of any Loan Party in each limited
liability company to which any Pledged LLC Interest relates, including, without
limitation:
(A) all interests of such Loan Party in the capital of such
limited liability company and in all profits, losses and assets, whether
tangible or intangible and whether real, personal or mixed, of such limited
liability company, and all other distributions to which such Loan Party
shall at any time be entitled in respect of such Pledged LLC Interests;
(B) all other payments due or to become due to such Loan Party in
respect of Pledged LLC Interests, whether under any limited liability
company agreement or operating agreement or otherwise and whether as
contractual obligations, damages, insurance proceeds or otherwise;
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(C) all of such Loan Party's claims, rights, powers, privileges,
authority, options, security interests, liens and remedies, if any, under
any limited liability company agreement or operating agreement, or at law
or otherwise in respect of such Pledged LLC Interests;
(D) all present and future claims, if any, of such Loan Party
against any such limited liability company for moneys loaned or advanced,
for services rendered or otherwise (exclusive of claims for salary and
other employee compensation); and
(E) all of such Loan Party's rights under any limited liability
company agreement or operating agreement or at law to exercise and enforce
every right, power, remedy, authority, option and privilege of such Loan
Party relating to such Pledged LLC Interests, including any power to
terminate, cancel or modify any limited liability company agreement or
operating agreement, to execute any instruments and to take any and all
other action on behalf of and in the name of such Loan Party in respect of
such Pledged LLC Interests and any such limited liability company, to make
determinations, to exercise any election (including, without limitation,
election of remedies) or option to give or receive any notice, consent,
amendment, waiver or approval, together with full power and authority to
demand, receive, enforce, collect or give receipt for any of the foregoing
or for any assets of any such limited liability company, to enforce or
execute any checks or other instruments or orders, to file any claims and
to take any other action in connection with any of the foregoing; and
(iv) to the extent not otherwise included in the foregoing, all cash
and non-cash Proceeds thereof.
"NOTE DOCUMENTS" means the Indenture, the Senior Secured Notes and the
Registration Rights Agreement related thereto and the Collateral Documents, in
each case including all exhibits and schedules thereto, and all other
agreements, documents and instruments relating to the Senior Secured Notes, in
each case as the same may be amended, modified or supplemented from time to time
in accordance with the provisions thereof.
"NOTEHOLDERS" means the holders from time to time of the Senior
Secured Notes.
"PARTNERSHIP INTERESTS" means:
(i) the partnership interests described on Schedule IV hereto, as such
Schedule may be amended, supplemented or modified from time to time (the
"PLEDGED PARTNERSHIP INTERESTS"), and all dividends, distributions, cash,
instruments and other property, income, profits and proceeds from time to time
received or receivable or otherwise made upon or distributed in respect of or in
exchange for any or all of the Pledged Partnership Interests;
(ii) all additional or substitute partnership interests from time to
time issued to or otherwise acquired by any Loan Party in any manner in respect
of Pledged Partnership Interests, and all dividends, distributions, cash,
instruments and other property, income, profits and proceeds from time to time
received or receivable or otherwise made upon or distributed in respect of such
additional or substitute partnership interests;
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(iii) all right, title and interest of any Loan Party in each
partnership to which any Pledged Partnership Interest relates, including,
without limitation:
(A) all interests of such Loan Party in the capital of such
partnership and in all profits, losses and assets, whether tangible or
intangible and whether real, personal or mixed, of such partnership, and
all other distributions to which such Loan Party shall at any time be
entitled in respect of such Pledged Partnership Interests;
(B) all other payments due or to become due to such Loan Party in
respect of Pledged Partnership Interests, whether under any partnership
agreement or otherwise and whether as contractual obligations, damages,
insurance proceeds or otherwise;
(C) all of such Loan Party's claims, rights, powers, privileges,
authority, options, security interests, liens and remedies, if any, under
any partnership agreement, or at law or otherwise in respect of such
Pledged Partnership Interests;
(D) all present and future claims, if any, of such Loan Party
against any such partnership for moneys loaned or advanced, for services
rendered or otherwise (exclusive of claims for salary and other employee
compensation); and
(E) all of such Loan Party's rights under any partnership
agreement or at law to exercise and enforce every right, power, remedy,
authority, option and privilege of such Loan Party relating to such Pledged
Partnership Interests, including any power to terminate, cancel or modify
any partnership agreement, to execute any instruments and to take any and
all other action on behalf of and in the name of such Loan Party in respect
of such Pledged Partnership Interests and any such partnership, to make
determinations, to exercise any election (including, without limitation,
election of remedies) or option to give or receive any notice, consent,
amendment, waiver or approval, together with full power and authority to
demand, receive, enforce, collect or give receipt for any of the foregoing
or for any assets of any such partnership, to enforce or execute any checks
or other instruments or orders, to file any claims and to take any other
action in connection with any of the foregoing; and
(iv) to the extent not otherwise included in the foregoing, all cash
and non-cash Proceeds thereof.
"PERFECTION CERTIFICATE" means with respect to each Loan Party a
certificate, substantially in the form of Exhibit E to the Security Agreement,
completed and supplemented with the schedules and attachments contemplated
thereby.
"PLEDGE AGREEMENT" means this Agreement, as the same may be amended,
supplemented or modified from time to time.
"PLEDGED LLC INTERESTS" has the meaning set forth in clause (i) of the
definition of "LLC Interests".
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"PLEDGED NOTES" has the meaning set forth in clause (i) of the
definition of "Instruments".
"PLEDGED PARTNERSHIP INTERESTS" has the meaning set forth in clause
(i) of the definition of "Partnership Interests".
"PLEDGED SHARES" has the meaning set forth in clause (i) of the
definition of "Stock".
"PROPERTY" means any interest in any kind of property or asset,
whether real, personal or mixed and whether tangible or intangible.
"SECURITY ENTITLEMENTS" means all "security entitlements" (as defined
in the UCC), including all rights and property interests with respect to
Financial Assets deposited in or credited to Securities Accounts.
"SECURITY INTERESTS" means the security interests in the Collateral
granted under this Agreement securing the Note Obligations.
"STOCK" means:
(i) the shares of stock and other Securities described on Schedule I
hereto, as such Schedule may be amended, supplemented or modified from time
to time (the "PLEDGED SHARES"), and all dividends, interest, distributions,
cash, instruments and other property, income, profits and proceeds from
time to time received, receivable or otherwise made upon or distributed in
respect of or in exchange for any or all of the Pledged Shares;
(ii) all additional or substitute shares of capital stock or other
equity interests of any class of any issuer from time to time issued to or
otherwise acquired by any Loan Party in any manner in respect of Pledged
Shares, the certificates representing such additional or substitute shares,
and all dividends, interest, distributions, cash, instruments and other
property, income, profits and proceeds from time to time received,
receivable or otherwise made upon or distributed in respect of or in
exchange for any or all of such additional or substitute shares; and
(iii) to the extent not otherwise included in the foregoing, all cash
and non-cash proceeds thereof.
"SUBSIDIARY GUARANTORS" has the meaning set forth in the introductory
paragraphs hereto.
"SUPPORTING OBLIGATION" means a guaranty or other secondary obligation
supporting, or any Lien securing, the payment or performance of one or more
Instruments, Investment Property or other item of Collateral.
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York; provided that if by reason of mandatory provisions of
law, the perfection, the
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effect of perfection or non-perfection or the priority of the Security Interests
in any Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than New York, "UCC" means the Uniform Commercial Code as in
effect in such other jurisdiction for purposes of the provisions hereof relating
to such perfection, effect of perfection or non-perfection or priority.
"US SUBSIDIARY" means with respect to any Person each Subsidiary of
such Person which, at the time of determination, is incorporated in or organized
under the law of the United States of America, any State thereof or the District
of Columbia, and "US SUBSIDIARIES" means all of them, collectively.
"US SUBSIDIARY GUARANTOR" means each Subsidiary Guarantor which, at
the time of determination, is incorporated in or organized under the laws of the
United States of America, any State thereof or the District of Columbia, and "US
SUBSIDIARY GUARANTORS" means all of them, collectively.
SECTION 1.04 Terms Generally. Terms defined in the introductory
paragraphs hereof and the definitions in Section 1.03 shall apply equally to
both the singular and plural forms of the terms defined. Wherever the context
may require, any pronouns shall include the corresponding masculine, feminine
and neuter forms. The words "include", "includes" and "including" shall be
deemed to be followed by the phrase "without limitation". All references herein
to Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
otherwise stated herein or the context shall otherwise require. Unless otherwise
expressly provided herein, the word "day" means a calendar day.
ARTICLE II
THE SECURITY INTERESTS
SECTION 2.01 Grant of Security Interests. To secure the due and
punctual payment of all Note Obligations, howsoever created, arising or
evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing or due or to become due, in accordance with the terms thereof and to
secure the performance of all of the obligations of each Loan Party and the
other Loan Parties hereunder and under the other Note Documents, each Loan Party
hereby grants to the Collateral Agent for the benefit of the Finance Parties a
security interest in, and each Loan Party hereby pledges and collaterally
assigns to the Collateral Agent for the benefit of the Finance Parties, all of
such Loan Party's right, title and interest in, to and under the following,
whether now owned or existing or hereafter acquired, created or arising, whether
tangible or intangible, and regardless of where located (all of which are herein
collectively called the "COLLATERAL"):
(i) Stock;
(ii) Instruments;
(iii) LLC Interests;
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(iv) Partnership Interests;
(v) Investment Property (other than Investment Property maintained in
any Excluded Securities Account (as defined in the Security Agreement);
(vi) Financial Assets (other than Financial Assets maintained in any
Excluded Securities Account (as defined in the Security Agreement); and
(vii) all Proceeds of all or any of the Collateral described in
clauses (i) through (vi) hereof;
provided, however, that the Collateral shall not include (v) cash or other
distributions in respect of federal, state and/or local income taxes payable by
any Loan Party or any direct or indirect equity holder of any Loan Party in
respect of the income and profits of any limited liability company, partnership
or other entity which is not a corporation for United States federal income tax
purposes, (w) any Voting Stock owned by any Loan Party which constitutes Voting
Stock issued by a Foreign Subsidiary of such Loan Party that is a corporation
for United States Federal Income tax purposes, in each case if and to the extent
that the inclusion of such Voting Stock in the Collateral would cause the
Collateral pledged by such Loan Party hereunder or under any other Note Document
to include in the aggregate more than 65% of the total combined voting power of
all classes of Voting Stock of such Foreign Subsidiary, (x) Excluded Contracts,
(y) any Capital Stock owned by any Loan Party and issued by an entity that is
not a Wholly Owned Subsidiary of such Loan Party to the extent (and only with
respect to such portion of such Capital Stock that would be prohibited as
referred to below) that any joint venture agreement, between or among any Loan
Party and one or more third parties with respect to a Permitted Joint Venture,
by the express terms of a valid and enforceable restriction in favor of such
third parties prohibits, or requires any consent for, the granting of a security
interest in such Capital Stock by such Loan Party, (z) any Capital Stock and
other securities of InSight, any of its Subsidiaries or any of Holdings'
Subsidiaries to the extent that the pledge of such Capital Stock or other
securities to secure the Note Obligations would cause Holdings, such Subsidiary,
or such Subsidiary of Holdings, as the case may be, to be required to file
separate financial statements with the Securities and Exchange Commission
pursuant to Rule 3-16 of Regulation S-X (as in effect from time to time) of the
Securities and Exchange Commission, (aa) any Receivables and Related Assets and
(bb) any proceeds or products from any and all of the foregoing.
Notwithstanding the foregoing, if granting or perfecting any Lien to
secure the Note Obligations on any Collateral cannot be granted or perfected
under applicable law, none of InSight or the Guarantors will be required to
grant or perfect, as applicable, such Lien.
SECTION 2.02 Security Interests Absolute. All rights of the Collateral
Agent, all security interests hereunder and all obligations of each Loan Party
hereunder are unconditional and absolute and independent and separate from any
other security for or guaranty of the Note Obligations, whether executed by such
Loan Party, any other Loan Party or any other Person. Without limiting the
generality of the foregoing, the obligations of each Loan Party hereunder shall
not be released, discharged or otherwise affected or impaired by:
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(i) any extension, renewal, settlement, compromise, acceleration,
waiver or release in respect of any obligation of any Loan Party under any
Note Document or any other agreement or instrument evidencing or securing
any Note Obligation, by operation of law or otherwise;
(ii) any change in the manner, place, time or terms of payment of any
Note Obligation or any other amendment, supplement or modification to any
Note Document or any other agreement or instrument evidencing or securing
any Note Obligation;
(iii) any release, non-perfection or invalidity of any direct or
indirect security for any Note Obligation, any sale, exchange, surrender,
realization upon, offset against or other action in respect of any direct
or indirect security for any Note Obligation or any release of any other
obligor in respect of any Note Obligation;
(iv) any change in the existence, structure or ownership of any Loan
Party, or any insolvency, bankruptcy, reorganization, arrangement,
readjustment, composition, liquidation or other similar proceeding
affecting any Loan Party or its assets or any resulting disallowance,
release or discharge of all or any portion of any Note Obligation;
(v) the existence of any claim, set-off or other right which any Loan
Party may have at any time against any other Loan Party or any Finance
Party or any other Person, whether in connection herewith or any unrelated
transaction; provided that nothing herein shall prevent the assertion of
any such claim by separate suit or compulsory counterclaim;
(vi) any invalidity or unenforceability relating to or against any
Loan Party for any reason of any Note Document or any other agreement or
instrument evidencing or securing any Note Obligation or any provision of
applicable law or regulation purporting to prohibit the payment by any Loan
Party of any Note Obligation;
(vii) any failure by any Finance Party: (A) to file or enforce a claim
against any Loan Party or its estate (in a bankruptcy or other proceeding);
(B) to give notice of the existence, creation or incurrence by any Loan
Party of any new or additional indebtedness or obligation under or with
respect to the Note Obligations; (C) to commence any action against any
Loan Party; (D) to disclose to any Loan Party any facts which such Finance
Party may now or hereafter know with regard to any Loan Party; or (E) to
proceed with due diligence in the collection, protection or realization
upon any collateral securing the Note Obligations;
(viii) any direction as to application of payment by any Loan Party or
any other Person;
(ix) any subordination by any Finance Party of the payment of any Note
Obligation to the payment of any other liability (whether matured or
unmatured) of any Loan Party to its creditors;
(x) any act or failure to act by the Collateral Agent or any other
Finance Party under this Agreement or otherwise which may deprive any Loan
Party of any right to
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subrogation, contribution or reimbursement against any other Loan Party or
any right to recover full indemnity for any payments made by such Loan
Party in respect of the Note Obligations; or
(xi) any other act or omission to act or delay of any kind by any Loan
Party or any Finance Party or any other Person or any other circumstance
whatsoever which might, but for the provisions of this clause, constitute a
legal or equitable discharge of any Loan Party's obligations hereunder
(other than final payment in full of the Note Obligations).
Each Loan Party has irrevocably and unconditionally delivered this
Agreement to the Collateral Agent, for the benefit of the Finance Parties, and
the failure by any other Person to sign this Agreement or a pledge agreement
similar to this Agreement or otherwise shall not discharge the obligations of
any Loan Party hereunder.
This Agreement shall remain fully enforceable against each Loan Party
irrespective of any defenses that any other Loan Party may have or assert in
respect of the Note Obligations, including, without limitation, failure of
consideration, breach of warranty, payment, statute of frauds, statute of
limitations, accord and satisfaction and usury, except that a Loan Party may
assert the defense of final payment in full of the Note Obligations.
SECTION 2.03 Continuing Liability of the Loan Parties. The Security
Interests are granted as security only and shall not subject the Collateral
Agent or any Finance Party to, or transfer or in any way affect or modify, any
obligation or liability of any Loan Party with respect to any of the Collateral
or any transaction in connection therewith.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Loan Party represents and warrants that:
SECTION 3.01 Title to Collateral. Such Loan Party is the legal, record
and beneficial owner of, and has good and marketable title to, all of the
Collateral pledged by it hereunder, free and clear of any Liens other than (i)
Permitted Liens and (ii) Liens in respect of which such Loan Party has delivered
UCC-3 termination statements or partial release financing statements to the
Collateral Agent on the Issue Date. No Collateral is in the possession or
control of any Person asserting any claim thereto or security interest therein,
except that the Collateral Agent or its nominee, custodian or a Securities
Intermediary acting on its behalf may have possession and/or control of
Collateral as contemplated hereby and by the other Note Documents.
SECTION 3.02 Validity, Perfection and Priority of Security Interests.
The Security Interests constitute valid security interests under the UCC
securing the Note Obligations. Upon Delivery of all Collateral to the Collateral
Agent in accordance with the provisions hereof and when UCC-1 financing
statements naming the Collateral Agent as secured party and containing a
description of the Collateral in the form specified in Exhibit E to the
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Security Agreement shall have been filed in the respective offices specified in
Schedule 4.01 to the Security Agreement, the Security Interests shall constitute
perfected security interests in all right, title and interest of such Loan Party
in the Collateral (subject to the requirements of Section 9-315 of the UCC with
respect to any proceeds of Collateral and to the further requirement that
additional steps may be necessary to perfect the Security Interests in dividends
or other distributions in kind), in each case prior to all other Liens and
rights of others therein except for Permitted Liens, and, to the extent control
of such Collateral may be obtained pursuant to Article 8 and/or 9 of the UCC,
the Collateral Agent will have control of the Collateral subject to no adverse
claims of any other Person.
SECTION 3.03 Collateral.
(a) Schedules I, II, III and IV hereto (as such schedules may be
amended, supplemented or modified from time to time by delivery of such amended,
supplemented or modified Schedules to the Collateral Agent in compliance with
this Agreement) set forth (i) the name and jurisdiction of organization of, and
the ownership interest (including percentage owned and number of shares, units
or other equity interests) of such Loan Party in the Stock, LLC Interests and
Partnership Interests issued by each of such Loan Party's direct Subsidiaries
which are required to be included in the Collateral and pledged hereunder, (ii)
all other Stock, LLC Interests and Partnership Interests directly owned by such
Loan Party that are required to be included in the Collateral and pledged
hereunder and (iii) the issuer, date and amount of all notes having a face value
in excess of $500,000 directly owned or held by such Loan Party that are
required to be included in the Collateral and pledged hereunder. Such Loan Party
holds all such Collateral directly unless otherwise indicated on such Schedule
(i.e., not through a Subsidiary, Securities Intermediary or any other Person).
(b) All Collateral consisting of Pledged Shares, Pledged LLC Interests
and Pledged Partnership Interests has been duly authorized and validly issued,
is fully paid and non-assessable and is subject to no options to purchase or
similar rights of any Person. Except as set forth on Schedules I, III and IV
hereto, and, in the case of clause (i) below, except as excluded from the
Collateral by the proviso to Section 2.01, (i) such Collateral constitutes 100%
of the issued and outstanding shares of capital stock or other equity interests
of the respective issuers thereof owned by the relevant Loan Party, (ii) no
issuer of Collateral other than any Permitted Joint Venture has outstanding any
security convertible into or exchangeable for any shares of its capital stock or
other equity interests or any warrant, option, convertible security, instrument
or other interest entitling the holder thereof to acquire any such shares or any
security convertible into or exchangeable for such shares and (iii) there are no
voting trusts, stockholder agreements, proxies or other agreements in effect
with respect to the voting or transfer of such shares of its capital stock
(other than in respect of any Permitted Joint Venture). Except as otherwise
permitted by the Note Documents, no Loan Party is now and or will become a party
to or otherwise bound by any agreement, other than this Agreement and the Note
Documents which restricts in any manner the rights of the Collateral Agent or
any other present or future holder of any Collateral to transfer or otherwise
dispose of Pledged Shares.
SECTION 3.04 No Consents. No consent of any other Person (including,
without limitation, any stockholder or creditor of such Loan Party or any of its
Subsidiaries) and no order, consent, approval, license, authorization or
validation of, or filing, recording or
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registration with, or exemption by any Governmental Authority is required to be
obtained by the Loan Party in connection with the execution, delivery or
performance of this Agreement, or in connection with the exercise of the rights
and remedies of the Collateral Agent pursuant to this Agreement, except as may
be required under the Collateral Agency Agreement or in connection with the
disposition of the Collateral by laws affecting the offering and sale of
securities generally or as described in Schedule 3.04 hereto.
ARTICLE IV
COVENANTS
Each Loan Party covenants and agrees that until the payment in full of
all Note Obligations (other than contingent indemnification obligations for
which a claim has not been made), such Loan Party will comply with the
following:
SECTION 4.01 Delivery of Collateral. All Collateral shall be Delivered
to and held by or on behalf of the Collateral Agent pursuant hereto; provided
that so long as no Event of Default shall have occurred and be continuing, and
except as required by any other Note Document, each Loan Party may retain any
Collateral (i) consisting of Instruments (other than Pledged Notes and any
additional or substitute promissory notes issued to or otherwise acquired by
such Loan Party in respect of Pledged Notes) received by it in the ordinary
course of business or (ii) which it is otherwise entitled to receive and retain
pursuant to Section 5.01 hereof, and the Collateral Agent shall, promptly upon
request of any Loan Party, make appropriate arrangements for making any
Collateral consisting of an Instrument or a Certificated Security pledged by
such Loan Party available to it for purposes of presentation, collection or
renewal (any such arrangement to be effected, to the extent deemed appropriate
to the Collateral Agent, against a trust receipt or like document). All
Collateral Delivered hereunder and shall be accompanied by any required transfer
tax stamps. The Collateral Agent shall have the right at any time upon the
request of the Directing Noteholders made during the continuance of and Event of
Default, and upon notice to any Loan Party, to cause any or all of the
Collateral to be transferred of record into the name of the Collateral Agent or
its nominee.
SECTION 4.02 Delivery of Perfection Certificate; Filing of Financing
Statements and Delivery of Search Reports. On or prior to the Issue Date, such
Loan Party shall deliver its Perfection Certificate to the Collateral Agent and
shall cause all filings to have been delivered to the Collateral Agent for
filing and recordings and other actions specified in Schedule 4.01 to the
Security Agreement to have been completed as required by the Security Agreement.
The information set forth in the Perfection Certificate is correct and complete
in all material respects.
SECTION 4.03 Further Assurances. Such Loan Party will, from time to
time at its expense at the request of the Collateral Agent and in such manner
and form as the Collateral Agent may require, execute, deliver, file and record
any financing statement, specific assignment, instrument, document, agreement or
other paper and take any other action (including, without limitation, any
filings of financing or continuation statements under the UCC) that from time to
time may be reasonably necessary or desirable, or that the Collateral Agent may
reasonably request, in order to create, preserve, perfect, confirm or validate
the
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Security Interests or to enable the Collateral Agent and the Finance Parties to
obtain the full benefit of this Agreement or to exercise and enforce any of its
rights, powers and remedies created hereunder or under applicable law with
respect to any of the Collateral. To the extent permitted by applicable law but
without limiting such Loan Party's obligations to itself comply with the first
sentence of this Section 4.04, such Loan Party hereby authorizes the Collateral
Agent to execute and file, in the name of such Loan Party or otherwise and
without the signature or other separate authorization or authentication of such
Loan Party appearing thereon, such UCC financing statements or continuation
statements as the Collateral Agent in its reasonably discretion may deem
necessary or appropriate to further perfect or maintain the perfection of the
Security Interests. Such Loan Party agrees that a carbon, photographic,
photostatic or other reproduction of this Agreement or of a financing statement
is sufficient as a financing statement. The Loan Parties shall pay the costs of,
or incidental to, any recording or filing of any financing or continuation
statements concerning the Collateral.
SECTION 4.04 Additional Collateral. Except as otherwise not prohibited
by any other Note Document, such Loan Party will cause each issuer of the
Collateral that is a Subsidiary of such Loan Party not to issue any stock, other
securities, limited liability company membership interests, partnership
interests, promissory notes or other instruments in addition to or in
substitution for the Pledged Shares, Pledged LLC Interests, Pledged Partnership
Interests and Pledged Notes issued by such issuer, except to a Loan Party, and,
in the event that any issuer of Collateral at any time issues any additional or
substitute stock, other securities, limited liability company membership
interests, partnership interests, promissory notes or other instruments to a
Loan Party, such Loan Party will (subject to the proviso to Section 2.01)
immediately Deliver all such items to the Collateral Agent to hold as Collateral
hereunder and will promptly thereafter deliver to the Collateral Agent such
supplements to Schedules I through IV hereto as are necessary to cause such
Schedules to be complete and accurate at such time and certifying that such
Pledged Shares, Pledged LLC Interests, Pledged Partnership Interests and/or
Pledged Notes have been duly pledged with the Collateral Agent hereunder.
SECTION 4.05 Information Regarding Collateral. Such Loan Party will,
promptly upon request, provide to the Collateral Agent all information and
evidence it may reasonably request concerning the Collateral to enable the
Collateral Agent to enforce the provisions of this Agreement.
ARTICLE V
DISTRIBUTIONS ON COLLATERAL; VOTING
SECTION 5.01 Right to Receive Distributions on Collateral; Voting.
(a) Unless and until an Event of Default shall have occurred and be
continuing and the Collateral Agent has delivered a written notice to InSight
stating its intent to exercise remedies under clauses (b) and (c) of this
Section 5.1:
(i) Each Loan Party shall be entitled to exercise any and all
voting, management, administration and other consensual rights pertaining
to the Collateral or any part thereof for any purpose not inconsistent with
the terms of this Agreement and
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the other Note Documents; provided, however, that no Loan Party shall
exercise or refrain from exercising any such right if such action would
violate or be inconsistent with any of the terms of this Agreement or any
other Note Document, or would have the effect of impairing the position or
interests of the Collateral Agent or any other Finance Party hereunder or
thereunder.
(ii) Each Loan Party shall be entitled to receive and retain any
and all dividends, interest, distributions, cash, instruments and other
payments and distributions made upon or in respect of the Collateral;
provided, however, that (other than, for the avoidance of doubt, any
dividends, interest, distributions, cash, instruments and other payments
and distributions made upon, consisting of or in respect of Receivables or
Related Assets) any and all:
(A) dividends, interest and other payments and distributions
paid or payable other than in cash in respect of, and instruments and
other property other than in cash received, receivable or otherwise
distributed in respect of, or in exchange for, any Collateral;
(B) dividends and other payments and distributions paid or
payable in cash in respect of any Collateral in connection with a
partial or total liquidation or dissolution or in connection with a
reduction of capital, capital surplus or paid-in-surplus;
(C) additional stock, other securities, limited liability
company membership interests, partnership interests, promissory notes
or other instruments or property paid or distributed in respect of any
Pledged Shares, Pledged LLC Interests or Pledged Partnership Interests
by way of share-split, spin-off, split-up, reclassification,
combination of shares or similar rearrangement;
(D) all other or additional stock, other securities, limited
liability company membership interests, partnership interests,
promissory notes or other instruments or property which may be paid in
respect of the Collateral by reason of any consolidation, merger,
exchange of shares, conveyance of assets, liquidation or similar
reorganization; and
(E) cash paid, payable or otherwise distributed in respect
of principal of, in redemption of, or in exchange for, any Collateral;
shall be forthwith (i) Delivered to the Collateral Agent or its nominee or
custodian to hold as Collateral hereunder or (ii) in the case of any amount
referred to in the proviso of this Section 5.01(a)(ii) paid or distributed in
cash, forthwith deposited in a Deposit Account maintained with the Collateral
Agent or with respect to which an effective Account Control Agreement as
contemplated by Section 4.13 of the Security Agreement has been delivered to the
Collateral Agent and shall, if received by any Loan Party, be received in trust
for the benefit of the Collateral Agent and the Finance Parties, be segregated
from the other property or funds of such Loan Party and be forthwith Delivered,
in the same form as so received, to the Collateral Agent
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or its nominee or custodian to hold as Collateral or deposited in a Deposit
Account as contemplated by clause (ii) above.
(iii) The Collateral Agent shall, upon receiving a written
request from any Loan Party accompanied by a certificate signed by an
authorized officer of such Loan Party stating that no Event of Default has
occurred and is continuing, execute and deliver (or cause to be executed
and delivered) to such Loan Party or as specified in such request all
proxies, powers of attorney, consents, ratifications and waivers and other
instruments as such Loan Party may reasonably request for the purpose of
enabling such Loan Party to exercise the voting and other rights which it
is entitled to exercise pursuant to paragraph (i) above and to receive the
dividends, interest, distributions, cash, instruments or other payments or
distributions which it is authorized to receive and retain pursuant to
paragraph (ii) above in respect of any of the Collateral which is
registered in the name of the Collateral Agent or its nominee.
(b) Upon the occurrence and during the continuance of an Event of
Default and following written notice from the Collateral Agent to InSight
stating its intent to exercise remedies under clauses (b) and (c) of this
Section 5.01:
(i) All rights of each Loan Party to receive the dividends,
interest, distributions, cash, instruments and other payments and
distributions which it would otherwise be authorized to receive and retain
pursuant to Section 5.01(a)(ii) above shall cease (other than, for the
avoidance of doubt, the rights of each Loan Party to receive any dividends,
interest, distributions, cash, instruments and other payments and
distributions made upon, consisting of or relating to Receivables or
Related Assets), and all such rights shall thereupon become vested in the
Collateral Agent, which shall thereupon have the sole right to receive and
hold as Collateral such dividends, interest, distributions, cash,
instruments and other payments and distributions; provided that all cash
dividends and other cash distributions in respect of federal, state and/or
local income taxes payable by any Loan Party or any direct or indirect
equity holder of any Loan Party in respect of income and profits of any
limited liability company, partnership or other entity which is not a
corporation for United States federal income tax purposes shall be paid to
the respective Loan Party free and clear of any Liens created hereby
regardless of whether an Event of Default shall have occurred and be
continuing.
(ii) All dividends, interest, distributions, cash, instruments
and other payments and distributions which are received by any Loan Party
contrary to the provisions of paragraph (i) of this Section 5.01(b) shall
be received in trust for the benefit of the Collateral Agent and the
Finance Parties, shall be segregated from other property or funds of such
Loan Party and shall be forthwith Delivered, in the same form as so
received to the Collateral Agent or its nominee or custodian to hold as
Collateral.
(c) Upon the occurrence and during the continuance of an Event of
Default and following written notice from the Collateral Agent to InSight
stating its intent to exercise remedies under clauses (b) and (c) of this
Section 5.01, all rights of such Loan Party to exercise the voting, management,
administration and other consensual rights which it would otherwise be entitled
to exercise pursuant to Section 5.01(a)(i) above shall cease, all such rights
shall thereupon become vested in the Collateral Agent, who shall thereupon have
the sole right to
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exercise such voting and other consensual rights, and such Loan Party shall take
all actions as may be necessary or appropriate to effect such right of the
Collateral Agent.
ARTICLE VI
GENERAL AUTHORITY; REMEDIES
SECTION 6.01 General Authority. Each Loan Party hereby irrevocably
appoints the Collateral Agent and any officer or agent thereof as its true and
lawful attorney-in-fact, with full power of substitution, in the name of such
Loan Party, the Collateral Agent, the Finance Parties or otherwise, for the sole
use and benefit of the Collateral Agent and the Finance Parties, but at such
Loan Party's expense, to the extent permitted by law, to exercise at any time
and from time to time while an Event of Default has occurred and is continuing,
all or any of the following powers with respect to all or any of the Collateral,
all acts of such attorney being hereby ratified and confirmed; such power, being
coupled with an interest, is irrevocable until the Note Obligations (excluding
contingent indemnification obligations) are paid in full:
(i) to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to carry out
the terms of this Agreement;
(ii) to receive, take, endorse, assign and deliver any and all checks,
notes, drafts, acceptances, documents and other negotiable and
non-negotiable instruments taken or received by such Loan Party as, or in
connection with, the Collateral;
(iii) to accelerate any Pledged Note which may be accelerated in
accordance with its terms, and to otherwise demand, sue for, collect,
receive and give acquittance for any and all monies due on or by virtue of
any Collateral;
(iv) to commence, settle, compromise, compound, prosecute, defend or
adjust any claim, suit, action or proceeding with respect to, or in
connection with, the Collateral;
(v) to sell, transfer, assign or otherwise deal in or with the
Collateral or the proceeds or avails thereof, as fully and effectually as
if the Collateral Agent were the absolute owner thereof;
(vi) to extend the time of payment of any or all of the Collateral and
to make any allowance and other adjustments with respect thereto;
(vii) subject to the giving of notice to the relevant Loan Party in
accordance with Section 5.01(a) hereof, to vote all or any part of the
Pledged Shares, Pledged LLC Interests, Pledged Partnership Interests and/or
Pledged Notes (whether or not transferred into the name of the Collateral
Agent) and give all consents, waivers and ratifications in respect of the
Collateral; and
(viii) to do, at its option, but at the expense of such Loan Party, at
any time or from time to time, all acts and things which the Collateral
Agent deems necessary to protect or preserve the Collateral and to realize
upon the Collateral.
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SECTION 6.02 Remedies upon Event of Default.
(a) If an Event of Default shall have occurred and be continuing, the
Collateral Agent may, in addition to all other rights and remedies granted to it
in this Agreement and in any other agreement securing, evidencing or relating to
the Note Obligations: (i) exercise on behalf of the Finance Parties all rights
and remedies of a secured party under the UCC (whether or not in effect in the
jurisdiction where such rights are exercised) and, in addition, (ii) without
demand of performance or other demand or notice of any kind (except as herein
provided or as may be required by mandatory provisions of law) to or upon any
Loan Party or any other Person (all of which demands and/or notices are hereby
waived by each Loan Party), (A) apply all cash, if any, then held by it as
Collateral as specified in Section 6.07 hereof and (B) if there shall be no such
cash or if such cash shall be insufficient to pay all the Note Obligations in
full or cannot be so applied for any reason or if the Collateral Agent
determines to do so, collect, receive, appropriate and realize upon the
Collateral and/or sell, assign, give an option or options to purchase or
otherwise dispose of and deliver the Collateral (or contract to do so) or any
part thereof in one or more parcels (which need not be in round lots) at public
or private sale or at broker's board or on any securities exchange, at any
office of the Collateral Agent or elsewhere in such manner as is commercially
reasonable and as the Collateral Agent may deem best, for cash, on credit or for
future delivery without assumption of any credit risk and at such price or
prices as the Collateral Agent may deem satisfactory.
(b) The Collateral Agent shall give each Loan Party not less than 10
days' prior notice of the time and place of any sale or other intended
disposition of any of the Collateral, except any Collateral which threatens to
decline speedily in value or is of a type customarily sold on a recognized
market. Any such notice shall (i) in the case of a public sale, state the time
and place fixed for such sale, (ii) in the case of a sale at a broker's board or
on a securities exchange, state the board or exchange at which such sale is to
be made and the day on which the Collateral, or the portion thereof being sold,
will first be offered for sale, (iii) in the case of a private sale, state the
day after which such sale may be consummated, (iv) contain the information
specified in Section 9-613 of the UCC, (v) be authenticated and (vi) be sent to
the parties required to be notified pursuant to Section 9-611(c) of the UCC;
provided that, if the Collateral Agent fails to comply with this sentence in any
respect, its liability for such failure shall be limited to the liability (if
any) imposed on it as a matter of law under the UCC. The Collateral Agent and
each Loan Party agree that such notice constitutes reasonable notification
within the meaning of Section 9-611 of the UCC. Except as otherwise provided
herein, each Loan Party hereby waives, to the extent permitted by applicable
law, notice and judicial hearing in connection with the Collateral Agent's
taking possession or disposition of any of the Collateral.
(c) The Collateral Agent or any Finance Party may be the purchaser of
any or all of the Collateral so sold at any public sale (or, if the Collateral
is of a type customarily sold in a recognized market or is of a type which is
the subject of widely distributed standard price quotations, at any private
sale). Each Loan Party will execute and deliver such documents and take such
other action as the Collateral Agent reasonably deems necessary or advisable in
order that any such sale may be made in compliance with law. Upon any such sale,
the Collateral Agent shall have the right to deliver, assign and transfer to the
purchaser thereof the Collateral so sold. Each purchaser at any such sale shall
hold the Collateral so sold to it absolutely and free
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from any claim or right of whatsoever kind. Any such public sale shall be held
at such time or times within ordinary bankers hours and at such place or places
as the Collateral Agent may fix in the notice of such sale. At any such sale,
the Collateral may be sold in one lot as an entirety or in such parcels, as the
Collateral Agent may determine. The Collateral Agent shall not be obligated to
make any such sale pursuant to any such notice. The Collateral Agent may,
without notice or publication, adjourn any public or private sale or cause the
same to be adjourned from time to time by announcement at the time and place
fixed for the sale, and such sale may be made at any time or place to which the
same may be so adjourned without further notice. In the case of any sale of all
or any part of the Collateral on credit or for future delivery, the Collateral
so sold may be retained by the Collateral Agent until the selling price is paid
by the purchaser thereof, but the Collateral Agent shall not incur any liability
in case of the failure of such purchaser to take up and pay for the Collateral
so sold and, in the case of such failure, such Collateral may again be sold upon
like notice.
SECTION 6.03 Securities Act. In view of the position of the Loan
Parties in relation to the Collateral, or because of other present or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being herein called the "FEDERAL SECURITIES LAWS") with respect to any
disposition of the Collateral permitted hereunder. Each Loan Party understands
that compliance with the Federal Securities Laws might very strictly limit the
course of conduct of the Collateral Agent if the Collateral Agent were to
attempt to dispose of all or any part of the Collateral, and might also limit
the extent to which or the manner in which any subsequent transferee of any
Collateral could dispose of the same. Similarly, there may be other legal
restrictions or limitations affecting the Collateral Agent in any attempt to
dispose of all or part of the Collateral under applicable Blue Sky or other
state securities laws or similar laws analogous in purpose or effect. Without
limiting the generality of the foregoing, the provisions of this Section 6.03
would apply if, for example, the Collateral Agent were to place all or any part
of the Collateral for private placement by an investment banking firm, or if
such investment banking firm purchased all or any part of the Collateral for its
own account, or if the Collateral Agent placed all or any part of the Collateral
privately with a purchaser or purchasers.
SECTION 6.04 Other Rights of the Collateral Agent.
(a) The Collateral Agent, instead of exercising the power of sale
conferred upon it pursuant to Section 6.02, may proceed by a suit or suits at
law or in equity to foreclose the Security Interests and sell the Collateral, or
any portion thereof, under a judgment or decree of a court or courts of
competent jurisdiction, and may in addition institute and maintain such suits
and proceedings as the Collateral Agent may deem appropriate to protect and
enforce the rights vested in the Collateral Agent by this Agreement.
(b) The Collateral Agent shall, to the extent permitted by applicable
law, without notice to any Loan Party or any party claiming through any Loan
Party, without regard to the solvency or insolvency at such time of any Person
then liable for the payment of any of the Note Obligations, without regard to
the then value of the Collateral and without requiring any bond from any
complainant in such proceedings, be entitled as a matter of right to the
appointment of a receiver or receivers (who may be the Collateral Agent) of the
Collateral or any
19
part thereof, and of the profits, revenues and other income thereof, pending
such proceedings, with such powers as the court making such appointment shall
confer, and to the entry of an order directing that the profits, revenues and
other income of the property constituting the whole or any part of the
Collateral be segregated, sequestered and impounded for the benefit of the
Collateral Agent and the Finance Parties, and each Loan Party irrevocably
consents to the appointment of such receiver or receivers and to the entry of
such order.
SECTION 6.05 Limitation on Duty of Collateral Agent in Respect of
Collateral. Beyond the exercise of reasonable care in the custody thereof,
neither the Collateral Agent nor any Finance Party shall have any duty to
exercise any rights or take any steps to preserve the rights of any Loan Party
in the Collateral in its or their possession or control or in the possession or
control of any agent or bailee or any income thereon or as to the preservation
of rights against prior parties or any other rights pertaining thereto. Each
Loan Party agrees that the Collateral Agent shall at no time be required to, nor
shall the Collateral Agent be liable to any Loan Party for any failure to,
account separately to any Loan Party for amounts received or applied by the
Collateral Agent from time to time in respect of the Collateral pursuant to the
terms of this Agreement. Without limiting the foregoing, the Collateral Agent's
sole duty with respect to the custody, safekeeping and physical preservation of
the Collateral in its possession, under Section 9-207 of the UCC or otherwise,
shall be (and in so doing shall be deemed to have exercised reasonable care in
respect thereof) to accord the Collateral treatment substantially equal to that
which the Collateral Agent accords its own property, and (i) shall not be liable
or responsible for any loss or damage to any of the Collateral, or for any
diminution in the value thereof, by reason of the act or omission of any agent
or bailee selected by the Collateral Agent in good faith or (ii) shall not have
any duty or responsibility for ascertaining or taking action with respect to
calls, conversions, exchanges, maturities, tenders or other matters relative to
any Collateral, whether or not the Collateral Agent has or is deemed to have
knowledge of such matters.
SECTION 6.06 Waiver and Estoppel.
(a) Each Loan Party, to the extent it may lawfully do so, on behalf of
itself and all who claim through or under it, including without limitation any
and all subsequent creditors, vendees, assignees and lienors, waives and
releases all rights to demand or to have any marshalling of the Collateral upon
any sale, whether made under any power of sale granted herein or pursuant to
judicial proceedings or under any foreclosure or any enforcement of this
Agreement, and consents and agrees that all of the Collateral may at any such
sale be offered and sold as an entirety.
(b) Each Loan Party waives, to the extent permitted by law,
presentment, demand, protest and any notice of any kind (except the notices
expressly required hereunder) in connection with this Agreement and any action
taken by the Collateral Agent with respect to the Collateral.
SECTION 6.07 Application of Proceeds.
(a) Priority of Distributions. The proceeds of any sale of, or other
realization upon, all or any part of the Collateral (including any proceeds
received and held pursuant to Section 5.01) and any cash held by the Collateral
Agent or its nominee or custodian hereunder
20
shall be applied as provided in Section 4.06 of the Collateral Agency Agreement.
The Collateral Agent may make distributions hereunder in cash or in kind or, on
a ratable basis, in any combination thereof.
(b) Deficiencies. It is understood that the Loan Parties shall remain
jointly and severally liable to the extent of any deficiency between the amount
of the proceeds of the Collateral and the amount of the Note Obligations.
ARTICLE VII
THE COLLATERAL AGENT
SECTION 7.01 Concerning the Collateral Agent. The provisions of
Article VI of the Collateral Agency Agreement shall inure to the benefit of the
Collateral Agent in respect of this Agreement and shall be binding upon all Loan
Parties and all Finance Parties and upon the parties hereto in such respect. In
furtherance and not in derogation of the rights, privileges and immunities of
the Collateral Agent therein set forth:
(i) The Collateral Agent is authorized to take all such actions
as are provided to be taken by it as Collateral Agent hereunder and all
other action reasonably incidental thereto. As to any matters not expressly
provided for herein or as to any matters which permit but do not require
action by the Collateral Agent (including, without limitation, the timing
and methods of realization upon the Collateral) the Collateral Agent shall
act or refrain from acting in accordance with written instructions from the
Directing Noteholders as contemplated by the Collateral Agency Agreement
or, in the absence of such instructions, subject to the terms of the
Collateral Agency Agreement, in accordance with its discretion.
(ii) The Collateral Agent shall not be responsible for the
existence, genuineness or value of any of the Collateral or for the
validity, perfection, priority or enforceability of the Security Interests
in any of the Collateral, whether impaired by operation of law or by reason
of any action or omission to act on its part hereunder unless such action
or omission constitutes gross negligence or willful misconduct. The
Collateral Agent shall have no duty to ascertain or inquire as to the
performance or observance of any of the terms of this Agreement or any Note
Document by any Loan Party.
SECTION 7.02 Appointment of Co-Collateral Agent. At any time or times,
in order to comply with any legal requirement in any jurisdiction, the
Collateral Agent may, in consultation with InSight and, unless an Event of
Default shall have occurred and be continuing, with its consent (not to be
unreasonably withheld or delayed), appoint another bank or trust company or one
or more other persons, either to act as co-agent or co-agents, jointly with the
Collateral Agent, or to act as separate agent or agents on behalf of the Finance
Parties with such power and authority as may be necessary for the effectual
operation of the provisions hereof and may be specified in the instrument of
appointment (which may, in the discretion of the Collateral Agent, include
provisions for the protection of such co-agent or separate agent similar to the
provisions of Section 7.01 above). Notwithstanding any such appointment but only
to the extent
21
not inconsistent with such legal requirements or, in the reasonable judgment of
the Collateral Agent, not unduly burdensome to it or any such co-agent, each
Loan Party shall be entitled to deal solely and directly with the Collateral
Agent rather than any such co-agent in connection with the Collateral Agent's
rights and obligations under this Agreement.
SECTION 7.03 Appointment of Sub-Agents. The Collateral Agent shall
have the right to appoint one or more sub-agents for the purpose of retaining
physical possession of the Pledged Shares, Pledged LLC Interests, Pledged
Partnership Interests and Pledged Notes, which may be held (in the discretion of
the Collateral Agent) in the name of the relevant Loan Party, endorsed or
assigned in blank or in favor of the Collateral Agent or any nominee or
custodian of the Collateral Agent or a sub-agent appointed by the Collateral
Agent.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01 Notices.
(a) Unless otherwise specified herein, all notices, requests or other
communications to any party hereunder shall be in writing (including by
facsimile transmission) and mailed, faxed or delivered to the address or
facsimile number: (i) in the case of Holdings, InSight, any Subsidiary Guarantor
or any Noteholder or the Trustee, as set forth in Section 13.02 of the
Indenture, (ii) in the case of the Collateral Agent, as set forth on the
signature pages hereof, or (iii) in the case of any party, to such other
address, facsimile number or electronic mail address as such party shall
hereafter specify for the purpose of communications hereunder by notice to the
other parties hereto. Each such notice, request or other communication shall be
effective upon the earlier to occur of (i) actual receipt by the intended
recipient and (ii) (A) if delivered by hand or by courier, when signed for by or
on behalf of the intended recipient, (B) if delivered by mail, four Business
Days after deposit in the mails, postage prepaid and (C) if delivered by
facsimile, when sent and receipt has been confirmed electronically. Rejection or
refusal to accept, or the inability to deliver because of a changed address of
which no notice was given shall not affect the validity of notice given in
accordance with this Section.
(b) This Agreement may be transmitted and/or signed by facsimile and,
if so transmitted or signed shall, subject to requirements of Law, have the same
force and effect as a manually-signed original and shall be binding on all Loan
Parties, the Collateral Agent and the Finance Parties. The Collateral Agent may
also require that this Agreement be confirmed by a manually-signed original
hereof; provided, however, that the failure to request or deliver the same shall
not limit the effectiveness of any facsimile document or signature.
SECTION 8.02 No Waivers; Non-Exclusive Remedies. No failure or delay
on the part of the Collateral Agent or any Finance Party to exercise, no course
of dealing with respect to, and no delay in exercising, any right, power or
privilege under this Agreement or any other Note Document or any other document
or agreement contemplated hereby or thereby shall operate as a waiver thereof
nor shall any single or partial exercise of any such right, power or privilege
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege. The rights and remedies provided herein and in the
other Note Documents are
22
cumulative and are not exclusive of any other remedies provided by law. Without
limiting the foregoing, nothing in this Agreement shall impair the right of any
Finance Party to exercise any right of set-off or counterclaim it may have and
to apply the amount subject to such exercise to the payment of indebtedness of
any Loan Party other than its indebtedness under the Note Documents. Each Loan
Party agrees, to the fullest extent it may effectively do so under applicable
law, that any holder of a participation in a Note Obligation, whether or not
acquired pursuant to the terms of any applicable Note Document, may exercise
rights of set-off or counterclaim or other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Loan Party in the amount of such participation.
SECTION 8.03 Compensation and Expenses of the Collateral Agent;
Indemnification.
(a) Expenses. The Loan Parties, jointly and severally, agree to pay
(i) all reasonable out-of-pocket expenses of the Collateral Agent, including
fees and disbursements of special and local counsel for the Collateral Agent, in
connection with the preparation and administration of this Agreement or any
document or agreement contemplated hereby, any waiver or consent hereunder or
any amendment hereof or any Default or Event of Default or alleged Default or
Event of Default, and (ii) all taxes which the Collateral Agent or any other
Finance Party may be required to pay by reason of the security interests granted
in the Collateral (including any applicable transfer taxes) or to free any of
the Collateral from the lien thereof.
(b) Protection of Collateral. If any Loan Party fails to comply with
the provisions of any Note Document, such that the value of any material portion
of Collateral or the validity, perfection, rank or value of any Security
Interest is thereby materially diminished or potentially materially diminished,
after notice to such Loan Party (unless in the reasonable judgment of the
Collateral Agent, notice is impractical) the Collateral Agent if requested by
the Directing Noteholders may, but shall not be required to, effect such
compliance on behalf of such Loan Party, and the Loan Parties shall reimburse
the Collateral Agent for the costs thereof on demand. Any and all excise,
property, sales and use taxes imposed by any state, federal or local authority
on any of the Collateral, or in respect of periodic appraisals of the
Collateral, or in respect of the sale or other disposition thereof shall be
borne and paid by the Loan Parties. If any Loan Party fails to promptly pay any
portion thereof when due, the Collateral Agent may, at its option, but shall not
be required to, pay the same and charge the Loan Parties' account therefor, and
the Loan Parties agree to reimburse the Collateral Agent therefor on demand. All
sums so paid or incurred by the Collateral Agent for any of the foregoing and
any and all other sums for which any Loan Party may become liable hereunder and
all costs and expenses (including attorneys' fees, legal expenses and court
costs) reasonably incurred by the Collateral Agent or any Noteholder in
enforcing or protecting the Security Interests or any of their rights or
remedies under this Agreement, shall, together with interest thereon from demand
and until paid at the rate applicable to interest at the highest rate applicable
under the Note Documents in respect of overdue obligations, be additional Note
Obligations hereunder.
(c) Indemnification. Each Loan Party agrees to indemnify the
Collateral Agent, each other Finance Party and their respective Affiliates,
directors, officers, employees, counsel, agents and attorneys-in-fact and their
respective successors and assigns (each, an "INDEMNITEE" and, collectively,
"INDEMNITEES") and hold each Indemnitee harmless from and
23
against any and all liabilities, obligations, losses, damages, penalties,
claims, demands, actions, suits, judgments, costs and expenses of any kind,
including, without limitation, the reasonable fees and disbursements of counsel,
which may be incurred by, imposed on or asserted against such Indemnitee in
connection with any investigation or administrative or judicial proceeding
(whether or not such Indemnitee shall be designated a party thereto) brought or
threatened relating to or arising out of this Agreement or any other Collateral
Document or in any other way connected with the enforcement of any of the terms
of, or the preservation of any rights hereunder, or in any way relating to or
arising out of the ownership, purchasing, delivery, control, acceptance,
financing, possession, sale, return or other disposition of the Collateral, the
violation of the laws of any country, state or other governmental body or unit,
or any tort or contract claim; provided that no Indemnitee shall have the right
to be indemnified hereunder for such Indemnitee's own gross negligence or
willful misconduct as determined by a court of competent jurisdiction in a
final, non-appealable judgment or order. Each Loan Party agrees that upon
written notice by any Indemnitee of the assertion of such a liability,
obligation, loss, damage, penalty, claim, demand, action, judgment or suit, such
Loan Party shall assume full responsibility for the defense thereof. Each
Indemnitee agrees to use its best efforts to notify the Loan Parties of any such
assertion of which such Indemnitee has knowledge.
(d) Contribution. If and to the extent that the obligations of any
Loan Party under this Section 8.03 are unenforceable for any reason, each Loan
Party hereby agrees to make the maximum contribution to the payment and
satisfaction of such obligations which is permissible under applicable law.
(e) Obligations; Survival. Any amounts paid by any Indemnitee as to
which such Indemnitee has the right to reimbursement shall constitute Note
Obligations. The indemnity obligations of the Loan Parties contained in this
Section 8.03 shall continue in full force and effect notwithstanding the full
payment of all Note Obligations and notwithstanding the discharge thereof.
SECTION 8.04 Enforcement. The Finance Parties agree that this
Agreement may be enforced only by the action of the Collateral Agent, acting
upon the instructions of the Directing Noteholders, if so required under the
Collateral Agency Agreement, and that no other Finance Party shall have any
right individually to seek to enforce this Agreement or to realize upon the
security to be granted hereby, it being understood and agreed that such rights
and remedies may be exercised by the Collateral Agent for the benefit of the
Finance Parties upon the terms of this Agreement and the Collateral Agency
Agreement.
SECTION 8.05 Amendments and Waivers. Any provision of this Agreement
may be amended, changed, discharged, terminated or waived if, but only if, such
amendment or waiver is in writing and is signed by each Loan Party affected by
such amendment, change, discharge, termination or waiver (it being understood
that the addition or release of any Loan Party hereunder shall not constitute an
amendment, change, discharge, termination or waiver affecting any Loan Party
other than the Loan Party so added or released and it being further understood
and agreed that any supplement to Schedules I, II, III and IV hereto shall not
require the consent of any Loan Party) and by the Collateral Agent (with the
consent of the Directing Noteholders or the Trustee, as the case may be, to the
extent required by the Collateral Agency Agreement).
24
SECTION 8.06 Successors and Assigns. This Agreement shall be binding
upon each of the parties hereto and inure to the benefit of the Collateral Agent
and the Finance Parties and their respective successors and assigns. In the
event of an assignment of all or any of the Note Obligations, the rights
hereunder, to the extent applicable to the indebtedness so assigned, may be
transferred with such indebtedness. No Loan Party shall assign or delegate any
of its rights and duties hereunder without the prior written consent of all of
the Finance Parties.
SECTION 8.07 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT
AS OTHERWISE REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT
THAT REMEDIES PROVIDED BY THE LAWS OF ANY JURISDICTIONS OTHER THAN NEW YORK ARE
GOVERNED BY THE LAWS OF SUCH JURISDICTIONS.
SECTION 8.08 Limitation of Law; Severability.
(a) All rights, remedies and powers provided in this 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 Agreement are
intended to be subject to all applicable mandatory provisions of law which may
be controlling and be limited to the extent necessary so that they will not
render this Agreement invalid, unenforceable in whole or in part, or not
entitled to be recorded, registered or filed under the provisions of any
applicable law.
(b) If any provision hereof is invalid or unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the Collateral Agent and the Finance
Parties in order to carry out the intentions of the parties hereto as nearly as
may be possible and (ii) the invalidity or unenforceability of any provision
hereof in any jurisdiction shall not affect the validity or enforceability of
such provisions in any other jurisdiction.
SECTION 8.09 Counterparts; Effectiveness. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
This Agreement shall become effective with respect to each Loan Party when the
Collateral Agent shall receive counterparts hereof executed by itself and such
Loan Party.
SECTION 8.10 Additional Loan Parties. It is understood and agreed that
any Subsidiary of InSight that is required by any Note Document to execute a
counterpart of this Agreement after the date hereof shall automatically become a
Loan Party hereunder with the same force and effect as if originally named as a
Loan Party hereunder by executing an instrument of accession or joinder
substantially in the form of Exhibit F to the Security Agreement and delivering
the same to the Collateral Agent. Concurrently with the execution and delivery
of such instrument of accession or joinder, such Subsidiary shall take all such
actions and deliver to the Collateral Agent all such documents and agreements as
such Subsidiary would
25
have been required to deliver to the Collateral Agent on or prior to the date of
this Agreement had such Subsidiary been a party hereto on the date of this
Agreement. Such additional materials shall include, among other things, an
opinion of counsel to the extent required under the Indenture and supplements to
Schedules I, II, III and IV hereto and to Schedule 4.01 of the Security
Agreement (which Schedules shall thereupon automatically be amended and
supplemented to include all information contained in such supplements) such
that, after giving effect to the accession or joinder of such Subsidiary, each
of Schedules I, II, III and IV hereto and Schedule 4.01 to the Security
Agreement is true, complete and correct in all material respects with respect to
such Subsidiary as of the effective date of such accession or joinder. The
execution and delivery of any such instrument of accession or joinder, and the
amendment and supplementation of the Schedules hereto as provided in the
immediately preceding sentence, shall not require the consent of any other Loan
Party hereunder. The rights and obligations of each Loan Party hereunder shall
remain in full force and effect notwithstanding the addition of any new Loan
Party as a party to this Agreement.
SECTION 8.11 Termination; Release of Loan Parties.
(a) Termination. Upon the full payment and performance of all Note
Obligations (other than contingent indemnification obligations), the Security
Interests shall terminate and all rights to the Collateral shall revert to the
Loan Parties. In addition, at any time and from time to time prior to such
termination of the Security Interests, the Collateral Agent may release any of
the Collateral or subordinate its Security Interests therein to Liens in favor
of certain third parties with the prior written consent of the Directing
Noteholders or as provided in Article V of the Collateral Agency Agreement. Upon
any such termination of the Security Interests or release of Collateral, the
Collateral Agent will, upon request by and at the expense of any Loan Party
(and, in the case of a release of Collateral, upon receipt of a written
certification of a Responsible Officer of InSight that the Trustee has received
all documents, if any, required by the Trust Indenture Act and the Indenture)
execute and deliver to such Loan Party such documents as such Loan Party shall
reasonably request to evidence the termination of the Security Interests or the
release of such Collateral, as the case may be. Any such documents shall be
without recourse to or warranty by the Collateral Agent or the other Finance
Parties. The Collateral Agent shall have no liability whatsoever to any other
Finance Party as a result of any release of Collateral by it as permitted by
this Section 8.11. Upon any release of Collateral pursuant to this Section 8.11,
none of the Finance Parties shall have any continuing right or interest in such
Collateral or the Proceeds thereof. Upon satisfaction and discharge of the
Indenture as provided in Article 12 of the Indenture, or legal defeasance or
covenant defeasance of the Indenture as provided in Article 8 of the Indenture,
the Note Obligations under the Note Documents shall be deemed to be paid in full
for purposes of Section 8.04, 8.05 and this Section 8.11(a).
(b) Release of Loan Parties. If any part of the Collateral (x) is
taken by eminent domain, condemnation or other similar circumstances or (y) is
sold, transferred, otherwise disposed of or liquidated in compliance with the
requirements of the Note Documents (or such sale, transfer, other disposition or
liquidation has been approved in writing by the Directing Noteholders), then in
each such case, such Collateral shall be automatically released from the
Security Interests created hereby and the Collateral Agent, at the request and
expense of the relevant Loan Party, will (upon receipt of a written
certification of a Responsible Officer of
26
InSight that the Trustee has received all documents, if any, required by the
Trust Indenture Act and the Indenture) assign, transfer and deliver to such Loan
Party (without recourse and without representation or warranty) such of the
Collateral as is then being (or has been) so taken, sold, transferred, disposed
of or liquidated as may be in the possession or control of the Collateral Agent
and has not theretofore been released pursuant to this Agreement and deliver to
the applicable Loan Party all documents and other releases reasonably requested
by such Loan Party (including UCC termination statements) to evidence the
release of such Collateral from the Security Interests. Further, upon the
release of a Guarantor from its obligations under all guaranties of the Note
Obligations in accordance with the provisions thereof and the other Note
Documents, such Guarantor (and the Collateral assigned by such Guarantor
pursuant hereto) shall be automatically released from this Agreement and the
Collateral Agent will, upon request by and at the expense of such Guarantor,
execute and deliver to such Guarantor such documents as such Guarantor shall
reasonably request to evidence the release of such Guarantor and such
Collateral.
(c) Other Releases. If property that constitutes either (A) all or
substantially all of the Collateral securing Note Obligations or (B) less than
all or substantially all of the Collateral securing Note Obligations is released
with the consent of the Directing Noteholders in accordance with the Collateral
Agency Agreement, then in each such case, the Collateral Agent, at the request
and expense of such Loan Party, will (upon receipt of a written certification of
a Responsible Officer of InSight that the Trustee has received all documents, if
any, required by the Trust Indenture Act and the Indenture) duly release from
the security interest created hereby and assign, transfer and deliver to such
Loan Party (without recourse and without representation or warranty) such of the
Collateral as is then being (or has been) so released as may be in the
possession or control of the Collateral Agent and has not theretofore been
released pursuant to this Agreement, and execute and deliver to such Loan Party
such documents and instruments (including UCC termination statements) as such
Loan Party may reasonably request to evidence the release of such Collateral. In
addition, if any Capital Stock or other securities shall, after the Issue Date,
meet the criteria of any of clauses (w), (x) or (y) of the proviso of Section 2.
01, such Capital Stock or other securities shall automatically be deemed to be
released from the Collateral and the Lien of this Agreement and the Collateral
Agent shall promptly after receipt of an Officer's Certificate deliver such
Capital Stock or other securities then in its possession to the applicable Loan
Party together with such releases and other documents as may be reasonably
requested by such Loan Party.
SECTION 8.12 Entire Agreement. This Agreement and the other Collateral
Documents constitute the entire agreement and understanding among the parties
hereto and supersedes any and all prior agreements and understandings, oral or
written, and any contemporaneous oral agreements and understandings relating to
the subject matter hereof and thereof.
[Signature Pages Follow]
27
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
LOAN PARTIES: INSIGHT HEALTH SERVICES CORP.
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
INSIGHT HEALTH SERVICES HOLDINGS CORP.
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
WILKES-BARRE IMAGING, L.L.C.
By: InSight Health Corp., as the sole
member and sole manager
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
MRI ASSOCIATES, L.P.
By: InSight Health Corp., as the general
partner
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
SIGNATURE PAGE - 1
VALENCIA MRI, LLC
ORANGE COUNTY REGIONAL PET CENTER -
IRVINE, LLC
SAN FERNANDO VALLEY REGIONAL PET
CENTER, LLC
By: InSight Health Corp., as the sole
member
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
PARKWAY IMAGING CENTER, LLC
By: /s/ Marilyn U. MacNiven-Young
------------------------------------
Name: Marilyn U. MacNiven-Young
Title: Manager
SIGNATURE PAGE - 2
INSIGHT HEALTH CORP.
OPEN MRI, INC.
MAXUM HEALTH CORP.
RADIOSURGERY CENTERS, INC.
MAXUM HEALTH SERVICES CORP.
DIAGNOSTIC SOLUTIONS CORP.
MAXUM HEALTH SERVICES OF NORTH TEXAS,
INC.
MAXUM HEALTH SERVICES OF DALLAS, INC.
NDDC, INC.
SIGNAL MEDICAL SERVICES, INC.
INSIGHT IMAGING SERVICES CORP.
COMPREHENSIVE MEDICAL IMAGING, INC.
COMPREHENSIVE MEDICAL IMAGING CENTERS,
INC.
COMPREHENSIVE MEDICAL IMAGING -
BILTMORE, INC.
COMPREHENSIVE OPEN MRI-EAST MESA, INC.
TME ARIZONA, INC.
COMPREHENSIVE MEDICAL IMAGING -FREMONT,
INC.
COMPREHENSIVE MEDICAL IMAGING-SAN
FRANCISCO, INC.
COMPREHENSIVE OPEN MRI-GARLAND, INC.
IMI OF ARLINGTON, INC.
COMPREHENSIVE MEDICAL IMAGING-
FAIRFAX, INC.
IMI OF KANSAS CITY, INC.
COMPREHENSIVE MEDICAL IMAGING -
BAKERSFIELD, INC.
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
SIGNATURE PAGE - 3
MAXUM HEALTH SERVICES CORP.
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
By: /s/ Marilyn U. MacNiven-Young
------------------------------------
Name: Marilyn U. MacNiven-Young
Title: Executive Vice President,
General Counsel and Secretary
COMPREHENSIVE OPEN MRI-
CARMICHAEL/FOLSOM, LLC
SYNCOR DIAGNOSTICS SACRAMENTO, LLC
SYNCOR DIAGNOSTICS BAKERSFIELD, LLC
By: Comprehensive Medical Imaging, Inc.
and Comprehensive Medical Imaging
Centers, Inc., as the members
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
PHOENIX REGIONAL PET CENTER-THUNDERBIRD,
LLC
By: Comprehensive Medical Imaging
Centers, Inc., as the sole member
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
MESA MRI
MOUNTAIN VIEW MRI
LOS GATOS IMAGING CENTER
WOODBRIDGE MRI
JEFFERSON MRI-BALA
JEFFERSON MRI
By: Comprehensive Medical Imaging, Inc.
and Comprehensive Medical Imaging
Centers, Inc., as the members
By: /s/ Mitch C. Hill
------------------------------------
Name: Mitch C. Hill
Title: Executive Vice President and
Chief Financial Officer
SIGNATURE PAGE - 4
COLLATERAL AGENT: U.S. BANK NATIONAL ASSOCIATION,
as Collateral Agent
By: /s/ Jean Clarke
------------------------------------
Name: Jean Clarke
Title: Assistant Vice President
Attention:
-----------------------------
Telephone: 212-361-6173
Telecopier: 212-361-6153
SIGNATURE PAGE - 5
EXHIBIT A
to
PLEDGE AGREEMENT
FORM OF ISSUER CONTROL AGREEMENT
CONTROL AGREEMENT dated as of [As of DATE] among [LOAN PARTY NAME],
[COLLATERAL AGENT NAME], as Collateral Agent, and [ISSUER NAME].
[Loan Party Name], [Loan Party Description] (together with its
successors and permitted assigns, the "LOAN PARTY"), and [Collateral Agent
Name], as Collateral Agent (together with its successor or successors in such
capacity, the "COLLATERAL AGENT"), propose to enter into a Pledge Agreement
dated as of September 22, 2005 (as the same may be amended, supplemented or
modified from time to time, the "PLEDGE AGREEMENT"), under which the Loan Party
will pledge to the Collateral Agent, and will grant a security interest in favor
of the Collateral Agent in, all right, title and interest of the Loan Party in,
to and under any and all (i) Uncertificated Securities (as defined in the Pledge
Agreement), (ii) Partnership Interests (as defined in the Pledge Agreement) and
(iii) LLC Interests (as defined in the Pledge Agreement), in each case issued
from time to time by [Issuer Name], [Issuer Description] (together with its
successors, the "ISSUER"), whether now existing or hereafter from time to time
acquired by the Loan Party (all of such Uncertificated Securities, Partnership
Interests and LLC Interests being herein collectively referred to as the
"PLEDGED INTERESTS") to secure the payment and performance of the Note
Obligations (as defined in the Pledge Agreement). Capitalized terms defined or
otherwise used in the Pledge Agreement and not otherwise defined herein have, as
used herein, the respective meanings provided for therein.
The Loan Party desires that the Issuer enter into this Agreement to
perfect the security interest of the Collateral Agent in the Pledged Interests,
to vest in the Collateral Agent control of the Pledged Interests and to provide
for the rights of the parties under this Control Agreement.
Accordingly, the parties hereto agree as follows:
1. Control by the Collateral Agent. The Loan Party hereby irrevocably
agrees that, for so long as this Control Agreement remains in effect, the
Collateral Agent shall have exclusive control of the Pledged Interests. In
furtherance of such agreement, the Loan Party hereby irrevocably authorizes and
directs the Issuer, and the Issuer hereby agrees, (i) to comply with any and all
instructions (within the meaning of Section 8-102(a)(12) of the UCC) originated
by the Collateral Agent regarding any or all of the Pledged Interests without
further consent by the Loan Party or any other Person, and (ii) subject to the
provisions of Section 2 of this Control Agreement, (A) not to comply with any
instructions regarding any or all of the Pledged Interests originated by any
Person other than the Collateral Agent or a court of competent jurisdiction and
(B) to distribute as instructed by the Collateral Agent all interest,
redemptions, distributions, dividends and other payments from time to time paid
with respect to any Pledged Interests (other than, for the avoidance of doubt,
any interest, redemptions, distributions, dividends and other payments made on,
consisting of or relating to Receivables or
Related Assets). In the case of any conflict between any instruction originated
by the Collateral Agent and any instruction originated by any other Person, the
Issuer shall comply only with the instruction originated by the Collateral
Agent.
2. Maintenance of Pledged Interests. In addition to, and not in lieu
of, the obligation of the Issuer to honor instructions and entitlement orders as
agreed in Section 1 hereof, the Issuer agrees follows:
(a) Subject to the rights of the Loan Party described herein, the
Issuer agrees that, from and after the date hereof, the Pledged Interests shall
be under the exclusive dominion and control of the Collateral Agent.
(b) Upon notice by the Collateral Agent during the continuance of
an Event of Default, the Issuer shall notify the Loan Party that the Pledged
Interests are subject to the sole control of the Collateral Agent and,
thereafter, the Issuer will not accept any direction or instructions with
respect to the Pledged Interests from any Person other than the Collateral
Agent, unless otherwise ordered by a court of competent jurisdiction.
(c) Until such time as the Issuer receives a notice of sole
control delivered by the Collateral Agent in accordance with Section 2(b) above,
the Loan Party may exercise all voting and other rights pertaining to the
Pledged Interests.
(d) Until such time as the Issuer receives a notice of sole
control delivered by the Collateral Agent in accordance with Section 2(b) above,
the Loan Party may direct the Issuer with respect to the distribution of
interest, redemptions, distributions, dividends and other payments on Pledged
Interests.
(e) To the extent requested by the Collateral Agent, all material
notices, statements of accounts, reports, prospectuses, financial statements and
other communications to be sent to the Loan Party by the Issuer in respect of
the Issuer will also be sent to the Collateral Agent at the following address:
[COLLATERAL AGENT NOTICE ADDRESS]
3. No Liability of Issuer. This Control Agreement shall not subject
the Issuer to any obligation or liability except as expressly set forth herein.
In particular, the Issuer need not investigate whether the Collateral Agent is
entitled under the Pledge Agreement or otherwise to give an instruction or
notice of sole control.
4. Representations and Warranties of the Issuer. The Issuer hereby
represents and warrants that:
(a) Except for the claims and interests of the Collateral Agent
and the Loan Party in the Pledged Interests, the Issuer does not know of any
claim to, or interest in, any Pledged Interests. If any Person asserts any Lien,
encumbrance or adverse claim (including any writ, garnishment, judgment, warrant
of attachment, execution or similar process) other than a Permitted Lien against
any Pledged Interest, the Issuer will promptly following its knowledge thereof
notify the Collateral Agent and the Loan Party thereof.
(b) There are no other agreements entered into between the Issuer
and the Loan Party with respect to the Pledged Interests, and the Issuer has not
entered into, and until the termination of this Control Agreement will not enter
into, any agreement with any other Person relating to the Pledged Interests, in
each case pursuant to which it has agreed or will agree to comply with
instructions originated by such other Person.
(c) This Control Agreement constitutes a valid and binding
agreement of the Issuer, enforceable against the Issuer in accordance with its
terms, except as enforceability may be limited by applicable bankruptcy
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally.
(d) The pledge by the Loan Party of, and the granting by the Loan
Party of a security interest in, the Pledged Interests to the Collateral Agent
does not violate the charter, by-laws, partnership agreement, operating
agreement or any other agreement governing the Issuer or the Pledged Interests.
(e) The Pledged Interests are fully-paid and nonassessable.
5. Notices. All notices, requests or other communications to any party
hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party:
(i) in the case of the Collateral Agent, at:
[Collateral Agent Notice Address];
(ii) in the case of the Loan Party, at:
[Loan Party Notice Address]; and
(iii) in the case of the Issuer, at:
[Issuer Notice Address].
Each such notice, request or other communication shall be effective (i) if given
by telex, when such telex is transmitted to the telex number specified in this
paragraph and the appropriate answerback is received, (ii) if given by facsimile
transmission, when transmitted to the facsimile number specified in this
paragraph and confirmation of receipt is received, (iii) if given by mail, 48
hours after such communication is deposited, certified mail, return receipt
requested, in the mails with appropriate first class postage prepaid, addressed
as aforesaid or (iv) if given by other means, when delivered at the address
specified in this paragraph. Rejection or refusal to accept, or the inability to
deliver because of a changed address of which no notice was given shall not
affect the validity of notice given in accordance with this paragraph.
6. Conflict with Other Agreements. In the event of any conflict
between this Control Agreement (or any portion hereof) and any other agreement
now existing or hereafter entered into, the terms of this Control Agreement
shall prevail.
7. Amendments and Waivers. Any provision of this Control Agreement may
be amended, changed, discharged, terminated or waived if, but only if, such
amendment, change, discharge, termination or waiver is in writing and is signed
by the Collateral Agent, the Issuer and the Loan Party.
8. Successors and Assigns. This Control Agreement shall be binding
upon each of the parties hereto and inure to the benefit of the Collateral Agent
and the other Finance Parties and their respective successors and assigns. In
the event of an assignment of all or any of the Note Obligations, the rights
hereunder, to the extent applicable to the Indebtedness so assigned, may be
transferred with such indebtedness.
9. Governing Law. This Control Agreement shall be governed by and
construed in accordance with the Laws of the State of New York.
10. Severability.
(a) All rights, remedies and powers provided in this Control
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 Control
Agreement are intended to be subject to all applicable mandatory provisions of
law which may be controlling and be limited to the extent necessary so that they
will not render this Control Agreement invalid, unenforceable in whole or in
part, or not entitled to be recorded, registered or filed under the provisions
of any applicable law.
(b) If any provision hereof is invalid or unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the Collateral Agent and the Finance
Parties in order to carry out the intentions of the parties hereto as nearly as
may be possible; and (ii) the invalidity or unenforceability of any provision
hereof in any jurisdiction shall not affect the validity or enforceability of
such provisions in any other jurisdiction.
11. Counterparts; Effectiveness. This Control Agreement may be
executed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Control Agreement shall become effective when the Collateral
Agent shall have received counterparts hereof executed by itself, the Issuer and
the Loan Parties.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Control
Agreement to be duly executed by their respective authorized officers as of the
day and year first written above.
LOAN PARTY: [LOAN PARTY NAME]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
ISSUER: [ISSUER NAME]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[COLLATERAL AGENT NAME],
as Collateral Agent
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
EXHIBIT B
to
PLEDGE AGREEMENT
ACCOUNT CONTROL AGREEMENT
ACCOUNT CONTROL AGREEMENT dated as of [As of Date] among [LOAN PARTY
NAME], [COLLATERAL AGENT NAME], as Collateral Agent, and [SECURITIES
INTERMEDIARY NAME].
[Loan Party Name], [Loan Party Description] (together with its
successors and permitted assigns, the "LOAN PARTY"), and [Collateral Agent
Name], as Collateral Agent (together with its successor or successors in such
capacity, the "COLLATERAL AGENT"), propose to enter into a Pledge Agreement
dated as of September 22, 2005 (as the same may be amended, supplemented or
modified from time to time, the "PLEDGE AGREEMENT"), under which the Loan Party
will pledge to the Collateral Agent, and will grant a security interest in favor
of the Collateral Agent in, all right, title and interest of the Loan Party in,
to and under (i) securities account number [Account Number] (the "ACCOUNT")
maintained by [Securities Intermediary Name], [Securities Intermediary
Description] (together with its successors and assigns, the "SECURITIES
INTERMEDIARY"), for the Loan Party, together with (ii) any and all (A) Security
Entitlements (as defined in the Pledge Agreement), (B) Investment Property (as
defined in the Pledge Agreement) and (C) other Financial Assets (as defined in
the Pledge Agreement), in each case from time to time deposited in or credited
to the Account (the Account and all of such Security Entitlements, Investment
Property and Financial Assets being herein collectively referred to as the
"PLEDGED INTERESTS") to secure the payment and performance of the Note
Obligations (as defined in the Pledge Agreement). Capitalized terms defined or
otherwise used in the Pledge Agreement and not otherwise defined herein have, as
used herein, the respective meanings provided for therein.
The Loan Party desires that the Securities Intermediary enter into
this Account Control Agreement to perfect the security interest of the
Collateral Agent in the Pledged Interests, to vest in the Collateral Agent
control of the Pledged Interests and to provide for the rights of the parties
under this Account Control Agreement.
Accordingly, the parties hereto agree as follows:
1. Control by the Collateral Agent. The Loan Party hereby irrevocably
agrees that, for so long as this Account Control Agreement remains in effect,
the Collateral Agent shall have control of the Account and all Pledged Interests
deposited therein or credited thereto. In furtherance of such agreement, the
Loan Party hereby irrevocably authorizes and directs the Securities
Intermediary, and the Securities Intermediary hereby agrees, (i) to comply with
any and all instructions (within the meaning of Section 8-102(a)(12) of the UCC)
and entitlement orders (within the meaning of Section 8-102(a)(8) of the UCC)
originated by the Collateral Agent regarding any or all of the Pledged Interests
without further consent by the Loan Party or any other Person, and (ii) subject
to the provisions of Section 2 of this Account Control Agreement, (A) not to
comply with any instructions or entitlement orders regarding any
or all of the Pledged Interests originated by any Person other than the Loan
Party, Collateral Agent or a court of competent jurisdiction and (B) to deposit
or retain in the Account, or to distribute as otherwise instructed by the
Collateral Agent, all interest, redemptions, distributions, dividends and other
payments from time to time received or paid with respect to any Pledged
Interests deposited in or credited to the Account. In the case of any conflict
between any instruction or entitlement order originated by the Collateral Agent
and any instruction or entitlement order originated by any other Person, the
Securities Intermediary shall comply only with the instruction or entitlement
order originated by the Collateral Agent.
2. Maintenance of Account. In addition to, and not in lieu of, the
obligation of the Securities Intermediary to honor instructions and entitlement
orders as agreed in Section 1 hereof, the Securities Intermediary agrees to
maintain the Account as follows:
(a) Maintenance of Account Generally. Subject to the rights of
the Loan Party described herein, the Securities Intermediary agrees that, from
and after the date hereof, the Account shall be under the dominion and control
of the Collateral Agent and all Financial Assets of the Loan Party, whether or
not deposited in or credited to the Account, shall be held by the Securities
Intermediary solely for the benefit of the Collateral Agent. The Securities
Intermediary shall follow its usual operational procedures for the handling of
any Financial Assets or other property of the Loan Party received in the Account
and shall maintain a record of all Financial Assets or other property received
in the Account.
(b) Notice of Sole Control. Upon notice by the Collateral Agent,
the Securities Intermediary shall notify the Loan Party that the Account is
subject to the sole control of the Collateral Agent and, thereafter, the
Securities Intermediary will not accept any direction, instructions or
entitlement orders with respect to the Account or the Pledged Interests on
deposit therein or credited thereto from any Person other than the Collateral
Agent, unless otherwise ordered by a court of competent jurisdiction.
(c) Registration of Securities, Etc. All Securities or other
property underlying any Financial Assets deposited in or credited to the Account
shall be registered in the name of the Securities Intermediary, endorsed to the
Securities Intermediary or in blank or credited to another Securities Account or
Securities Accounts maintained in the name of the Securities Intermediary, and
in no case will any Financial Asset deposited in or credited to the Account be
registered in the name of the Loan Party, payable to the order of the Loan Party
or specially indorsed to the Loan Party, except to the extent the foregoing have
been specially indorsed by the Loan Party to the Securities Intermediary or in
blank.
(d) Voting Rights. Until such time as the Securities Intermediary
receives a notice of sole control delivered by the Collateral Agent in
accordance with Section 2(b) above, the Loan Party may direct the Securities
Intermediary with respect to the voting of any Pledged Interests deposited in or
credited to the Account.
(e) Permitted Investments. Until such time as the Securities
Intermediary receives a notice of sole control delivered by the Collateral Agent
in accordance with Section 2(b) above, the Loan Party may direct the Securities
Intermediary with respect to the selection of Investments to be made in the
Account.
(f) Interest and Dividends. Until such time as the Securities
Intermediary receives a notice of sole control delivered by the Collateral Agent
in accordance with Section 2(b) above, the Loan Party may direct the Securities
Intermediary with respect to the retention and/or distribution of interest,
redemptions, distributions, dividends and other payments on Pledged Interests
deposited in or credited to the Account.
(g) Statements and Confirmations. Copies of all notices,
statements of accounts, reports, confirmations, prospectuses, financial
statements and other communications concerning the Account and/or any Pledged
Interests deposited therein or credited thereto shall be sent by the Securities
Intermediary to each of the Loan Party and the Collateral Agent at their
respective addresses referred to in Section 7 below.
(h) Tax Reporting. All items of income, gain, expense and loss
recognized in the Account shall be reported to the Internal Revenue Service and
all state and local taxation authorities under the name and taxpayer
identification number of the Loan Party.
3. Financial Assets Election. The Securities Intermediary and each
other party hereto hereby agrees that each item of property (whether Investment
Property, Financial Asset, Security, Instrument or cash) deposited in or
credited to the Account shall constitute a "financial asset" within the meaning
of Section 8-102(a)(9) of the UCC.
4. No Liability of Securities Intermediary. This Account Control
Agreement shall not subject the Securities Intermediary to any obligation or
liability except as expressly set forth herein. In particular, the Securities
Intermediary need not investigate whether the Collateral Agent is entitled under
the Pledge Agreement or otherwise to give an entitlement order, instructions or
notice of sole control.
5. Subordination of Lien; Waiver of Set-Off. If the Securities
Intermediary has or subsequently obtains by agreement, operation of law or
otherwise a security interest in the Account or any Pledged Interest deposited
therein or credited thereto, the Securities Intermediary hereby agrees that such
security interest shall be subordinate to the Security Interest of the
Collateral Agent. The Pledged Interests and other items deposited in or credited
to the Account will not be subject to deduction, set-off, banker's lien or any
other right in favor of any other Person other than the Collateral Agent (except
that the Securities Intermediary may set off (i) all amounts due to the
Securities Intermediary in respect of customary fees and expenses for the
routine maintenance and operation of the Account, (ii) the face amount of any
checks which have been credited to the Account but are subsequently returned
unpaid because of uncollected or insufficient funds and (iii) the purchase price
of any property purchased for the Account).
6. Representations and Warranties of the Securities Intermediary. The
Securities Intermediary hereby represents and warrants that:
(a) The Securities Intermediary has established the Account in
the name of "[Collateral Agent Name], as Collateral Agent", and the Securities
Intermediary shall not change the name or account number of the Account without
the prior written consent of the Collateral Agent.
(b) The Account is a "securities account" as defined in Section
8-501(a) of the UCC, and the Securities Intermediary is a "securities
intermediary" as defined in Section 8-102(a)(14) of the UCC and is acting in
such capacity in connection with the Account and this Account Control Agreement.
(c) Except for the claims and interest of the Collateral Agent
and of the Loan Party in the Pledged Interests, the Securities Intermediary does
not know of any claim to, or interest in, the Account or in any Pledged Interest
deposited therein or credited thereto. If any Person asserts any Lien,
encumbrance or adverse claim (including any writ, garnishment, judgment, warrant
of attachment, execution or similar process) against the Account or any Pledged
Interest deposited therein or credited thereto, the Securities Intermediary will
promptly notify the Collateral Agent and the Loan Party thereof.
(d) There are no other agreements entered into between the
Securities Intermediary and the Loan Party with respect to the Account or any
Pledged Interest deposited therein or credited thereto, and the Securities
Intermediary has not entered into, and until the termination of this Account
Control Agreement will not enter into, any agreement with any other Person
relating to the Account and/or any Pledged Interests deposited therein or
credited thereto pursuant to which it has agreed or will agree to comply with
instructions or entitlement orders originated by such other Person.
(e) This Account Control Agreement constitutes a valid and
binding agreement of the Securities Intermediary, enforceable against the
Securities Intermediary in accordance with its terms.
7. Notices. All notices, requests or other communications to any party
hereunder shall be in writing (including bank wire, telex, facsimile
transmission or similar writing) and shall be given to such party:
(i) in the case of the Collateral Agent, at:
[Collateral Agent Notice Address];
(ii) in the case of the Loan Party, at:
[Loan Party Notice Address]; and
(iii) in the case of the Securities Intermediary, at:
[Securities Intermediary Notice Address].
Each such notice, request or other communication shall be effective
(i) if given by telex, when such telex is transmitted to the telex number
specified in this paragraph and the appropriate answerback is received, (ii) if
given by facsimile transmission, when transmitted to the facsimile number
specified in this paragraph and confirmation of receipt is received, (iii) if
given by mail, 48 hours after such communication is deposited, certified mail,
return receipt requested, in the mails with appropriate first class postage
prepaid, addressed as aforesaid or (iv) if given by other means, when delivered
at the address specified in this paragraph. Rejection or
refusal to accept, or the inability to deliver because of a changed address of
which no notice was given shall not affect the validity of notice given in
accordance with this paragraph.
8. Indemnification of Securities Intermediary. The Loan Party agrees
that (i) the Securities Intermediary is released from any and all liabilities to
the Loan Party arising from the terms of this Account Control Agreement and the
compliance by the Securities Intermediary with the terms hereof, except to the
extent that such liabilities arise from the Securities Intermediary's bad faith,
willful misconduct or gross negligence and (ii) the Loan Party, its successors
and permitted assigns shall at all times indemnify the Securities Intermediary,
its affiliates and the respective directors, officers, trustees, agents and
employees of the foregoing (each an "INDEMNITEE") and hold each Indemnitee
harmless from and against any and all liabilities, obligations, losses, damages,
penalties, claims, demands, actions, suits, judgments, costs and expenses of any
kind, including, without limitation, the reasonable fees and disbursements of
counsel, which may be incurred by, imposed on or asserted against such
Indemnitee in connection with any investigation or administrative or judicial
proceeding (whether or not such Indemnitee shall be designated a party thereto)
brought or threatened relating to or arising out of this Account Control
Agreement or in any other way connected with the enforcement of any of the terms
of, or the preservation of any rights hereunder, or in any way relating to or
arising out of the maintenance, delivery, control, acceptance, possession,
return or other disposition of the Account or any Pledged Interests on deposit
therein or credited thereto, the violation of the laws of any country, state or
other governmental body or unit, or any tort or contract claim; provided that no
Indemnitee shall have the right to be indemnified hereunder for such
Indemnitee's own gross negligence or willful misconduct as determined by a court
of competent jurisdiction in a final, non-appealable judgment or order. In
performing its duties hereunder, the Securities Intermediary shall be entitled
to rely upon notices and other communications it believes in good faith to have
been originated by the appropriate party.
9. Conflicts with Other Agreements. In the event of any conflict
between this Account Control Agreement (or any portion hereof) and any other
agreement now existing or hereafter entered into, the terms of this Account
Control Agreement shall prevail.
10. Amendments and Waivers. Any provision of this Account Control
Agreement may be amended, modified or waived if, but only if, such amendment or
waiver is in writing and is signed by the Loan Party, the Collateral Agent and
the Securities Intermediary.
11. Successors and Assigns. This Account Control Agreement shall be
binding upon each of the parties hereto and inure to the benefit of the
Collateral Agent and the Finance Parties and their respective successors and
permitted assigns. In the event of an assignment of all or any of the
Obligations, the rights hereunder, to the extent applicable to the indebtedness
so assigned, may be transferred with such indebtedness.
12. Governing Law. This Account Control Agreement shall be governed by
and construed in accordance with the laws of the State of New York, except as
otherwise required by mandatory provisions of law. Notwithstanding any provision
in any other agreement, for purposes of the UCC, New York shall be deemed to be
the Securities Intermediary's jurisdiction and the Account (as well as the
Security Entitlements related thereto) shall be governed by the laws of the
State of New York.
13. Severability.
(a) All rights, remedies and powers provided in this Account
Control 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
Account Control Agreement are intended to be subject to all applicable mandatory
provisions of law which may be controlling and be limited to the extent
necessary so that they will not render this Account Control Agreement invalid,
unenforceable in whole or in part, or not entitled to be recorded, registered or
filed under the provisions of any applicable law.
(b) If any provision hereof is invalid or unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the Collateral Agent and the Finance
Parties in order to carry out the intentions of the parties hereto as nearly as
may be possible; and (ii) the invalidity or unenforceability of any provision
hereof in any jurisdiction shall not affect the validity or enforceability of
such provisions in any other jurisdiction.
14. Counterparts; Effectiveness. This Account Control Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Account Control Agreement shall become effective when the
Collateral Agent shall receive counterparts hereof executed by itself, the
Securities Intermediary and the Loan Party.
15. Termination. Except as hereinafter set forth, the obligations of
the Securities Intermediary to the Collateral Agent pursuant to this Account
Control Agreement shall continue in effect until the Security Interests of the
Collateral Agent in the Account have been terminated pursuant to the terms of
the Pledge Agreement and the Collateral Agent has notified the Securities
intermediary of such termination in writing. The Collateral Agent agrees to
provide such notice of termination upon the request of the Loan Party on or
after the termination of the Collateral Agent's Security Interest in the Account
pursuant to the terms of the Pledge Agreement. The Securities Intermediary may
terminate this Account Control Agreement only upon 30 days' notice to the
Collateral Agent, by canceling the Account and transferring all funds, if any,
deposited in or credited to the Account to another Securities Account with
another securities intermediary to be designated by the Collateral Agent. After
any such termination, the Securities Intermediary shall nonetheless be obligated
promptly to transfer to such other securities intermediary anything from time to
time received in the Account. The termination of this Account Control Agreement
shall not terminate the Account or alter the obligations of the Securities
Intermediary to the Loan Party pursuant to any other agreement with respect to
the Account.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Control
Agreement to be duly executed by their respective authorized officers as of the
day and year first written above.
LOAN PARTY: [LOAN PARTY NAME]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
SECURITIES INTERMEDIARY: [SECURITIES INTERMEDIARY NAME]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
COLLATERAL AGENT; [COLLATERAL AGENT NAME],
as Collateral Agent
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------