Exhibit 4.12
Amended and Restated Pledge Agreement
This Amended and Restated Pledge Agreement (the "Agreement") is dated as of
May 15, 1997, by and among Everest Healthcare Services Corporation, a Delaware
corporation (the "Company"), and the other parties executing this Agreement
under the heading "Pledgors" (the Company and such other parties, along with any
parties who execute and deliver to the Agent an agreement in the form attached
hereto as Schedule F, being hereinafter referred to collectively as the
"Pledgors" and individually as a "Pledgor"), each with its mailing address as
set forth on its signature page hereto and Xxxxxx Trust and Savings Bank, an
Illinois state banking corporation ("Xxxxxx"), with its mailing address at 000
Xxxx Xxxxxx Xxxxxx, X.X. Xxx 000, Xxxxxxx, Xxxxxxxx 00000, acting as agent
hereunder for the Lenders hereinafter identified and defined (Xxxxxx acting as
such agent and any successor or successors to Xxxxxx acting in such capacity
being hereinafter referred to as the "Agent");
Preliminary Statements
A. The Company and Xxxxxx, individually and as agent, have entered into
an Amended and Restated Credit Agreement dated as of even date herewith (such
Amended and Restated Credit Agreement as the same may be amended, modified or
restated from time to time being hereinafter referred to as the "Credit
Agreement"), pursuant to which Xxxxxx and other lenders which from time to time
become party to the Credit Agreement (Xxxxxx and such other lenders which from
time to time hereafter become party to the Credit Agreement being hereinafter
referred to collectively as the "Lenders" and individually as a "Lender") have
agreed, subject to certain terms and conditions, to extend credit and make
certain other financial accommodations available to the Company.
B. The Company may from time to time enter into one or more interest rate
exchange, cap, collar, floor or other agreements with one or more of the Lenders
party to the Credit Agreement for the purpose of hedging or otherwise protecting
the Company against changes in interest rates (the liability of the Company in
respect of such agreements with such Lenders being hereinafter referred to as
the "Hedging Liability").
C. As a condition to extending credit to the Company under the Credit
Agreement, the Lenders have required, among other things, that (i) each Pledgor,
other than the Company, guarantee all indebtedness, obligations and liabilities,
whether now existing or hereafter arising, of the Company under or arising out
of the Credit Agreement pursuant to that certain Amended and Restated Guaranty
Agreement dated as of even date herewith between such Pledgors and the Agent, as
the same may be amended, modified, supplemented and/or restated from time to
time (the "Guaranty") and (ii) each Pledgor, including the Company, grant to the
Agent for the
benefit of the Lenders a security interest in certain personal property of such
Pledgor described herein subject to the terms and conditions hereof.
D. The Company owns, directly or indirectly, all or substantially all of
the equity interests in each other Pledgor and the Company provides each other
Pledgor with financial, management, administrative, and technical support which
enables such Pledgor to conduct its business in an orderly and efficient manner
in the ordinary course.
E. Each Pledgor will benefit, directly or indirectly, from credit and
other financial accommodations extended by the Lenders to the Company.
Now, Therefore, for and in consideration of the execution and delivery by
the Lenders of the Credit Agreement, and other good and valuable consideration,
receipt whereof is hereby acknowledged, the parties hereto hereby agree as
follows:
Section 1. Terms Defined in Credit Agreement. All capitalized terms
used herein without definition shall have the same meanings herein as such terms
have in the Credit Agreement. The term "Pledgor" and "Pledgors" as used herein
shall mean and include the Pledgors collectively and also each individually,
with all grants, representations, warranties and covenants of and by the
Pledgors, or any of them, herein contained to constitute joint and several
grants, representations, warranties and covenants of and by the Pledgors;
provided, however, that unless the context in which the same is used shall
otherwise require, any grant, representation, warranty or covenant contained
herein related to the Collateral shall be made by each Pledgor only with respect
to the Collateral owned by it or represented by such Pledgor as owned by it.
Section 2. Grant of Security Interest in the Collateral. Each Pledgor
hereby grants to the Agent for the benefit of itself and the other Lenders a
lien on and security interest in, and acknowledges and agrees that the Agent has
and shall continue to have for the benefit of itself and the other Lenders a
continuing lien on and security interest in, any and all right, title and
interest of each Pledgor in all equity interests of each of its Subsidiaries,
whether now owned or existing or hereafter created, acquired or arising, and in
whatever form, including, without limitation, any and all right, title, and
interest in and to the following:
(a) Stock Collateral. (i) All shares of the capital stock of each
Subsidiary which is a corporation owned or held by such Pledgor, whether
now owned or hereafter formed or acquired (those shares delivered to and
deposited with the Agent on or prior to the date hereof being listed and
described on Schedule A attached hereto), and all substitutions and
additions to such shares (herein, the "Pledged Securities"), (ii) all
dividends, distributions and sums distributable or payable from, upon or in
respect of the Pledged Securities and (iii) all other rights and privileges
incident to the Pledged
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Securities (all of the foregoing being hereinafter referred to collectively
as the "Stock Collateral");
(b) Partnership Interest Collateral. (i) All partnership or other
equity interests in each Subsidiary which is a partnership (whether general
or limited) owned or held by such Pledgor, whether now owned or hereafter
formed or acquired (each of such equity interests existing on the date
hereof being listed and identified on Schedule B attached hereto) (such
partnerships being hereinafter referred to collectively as the
"Partnerships" and individually as a "Partnership"), (ii) any and all
payments and distributions of whatever kind or character, whether in cash
or other property, at any time made, owing or payable to such Pledgor in
respect of or on account of its present or hereafter acquired interests in
each Partnership, whether due or to become due and whether representing
profits, distributions pursuant to complete or partial liquidation or
dissolution of any such Partnership, distributions representing the
complete or partial redemption of such Pledgor's interest in any such
Partnership or the complete or partial withdrawal of such Pledgor from any
such Partnership, repayment of capital contributions, payment of management
fees or commissions, or otherwise, and the right to receive, receipt for,
use and enjoy all such payments and distributions, and (iii) all other
rights and privileges incident to such Pledgor's interest in each
Partnership (all of the foregoing being hereinafter collectively called the
"Partnership Interest Collateral");
(c) LLC Collateral. (i) All membership or other equity interests in
each Subsidiary which is a limited liability company owned or held by such
Pledgor, whether now owned or hereafter formed or acquired (each of such
equity interests existing on the date hereof being listed and identified on
Schedule C attached hereto (such limited liability companies being
hereinafter referred to collectively as the "LLCs" and individually as a
"LLC"), (ii) any and all payments and distributions of whatever kind or
character, whether in cash or other property, at any time made, owing or
payable to such Pledgor in respect of or on account of its present or
hereafter acquired interests in each LLC, whether due or to become due and
whether representing profits, distributions pursuant to complete or partial
liquidation or dissolution of any such LLC, distributions representing the
complete or partial redemption of such Pledgor's interest in such LLC or
the complete or partial withdrawal of such Pledgor from any such LLC,
repayment of capital contributions, payment of management fees or
commissions, or otherwise, and the right to receive, receipt for, use and
enjoy all such payments and distributions, and (iii) all other rights and
privileges incident to such Pledgor's interest in each LLC (all of the
foregoing being hereinafter referred to as the "LLC Collateral"); and
(d) Proceeds. All proceeds of the foregoing;
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all of the foregoing being herein sometimes referred to as the "Collateral."
All terms which are used in this Agreement which are defined in the Uniform
Commercial Code of the State of Illinois ("UCC") shall have the same meanings
herein as such terms are defined in the UCC, unless this Agreement shall
otherwise specifically provide.
Section 3. Obligations Hereby Secured. This Agreement is made and
given to secure, and shall secure, the prompt payment and performance of (i) any
and all indebtedness, obligations and liabilities of the Pledgors, of any of
them, to the Agent and the Lenders, and any of them, under or in connection with
or evidenced by the Credit Agreement, the Notes of the Company heretofore or
hereafter issued under the Credit Agreement and the obligations of the Company
to reimburse the Agent and the Lenders for the amount of all drawings on all
Letters of Credit issued for the account of the Company pursuant to the Credit
Agreement, and all other obligations of the Company under any and all
applications for Letters of Credit, or under or in connection with or otherwise
evidenced by the Guaranty or any of the other Loan Documents, or under or in
connection with or otherwise evidenced by agreements with any one or more of the
Lenders with respect to Hedging Liability, in each case whether now existing or
hereafter arising (and whether arising before or after the filing of a petition
in bankruptcy), due or to become due, direct or indirect, absolute or
contingent, and howsoever evidenced, held or acquired and (ii) any and all
expenses and charges, legal or otherwise, suffered or incurred by the Agent and
the Lenders, and any of them, in collecting or enforcing any of such
indebtedness, obligations and liabilities or in realizing on or protecting or
preserving any security therefor, including, without limitation, the lien and
security interest granted hereby (all of the indebtedness, obligations,
liabilities, expenses and charges described above being hereinafter referred to
as the "Obligations"). Notwithstanding anything in this Agreement to the
contrary, the right of recovery against any Pledgor (other than the Company to
which this limitation shall not apply) under this Agreement shall not exceed
$1.00 less than the amount which would render such Pledgor's obligations under
this Agreement void or voidable under applicable law, including fraudulent
conveyance law.
Section 4. Covenants, Agreements, Representations and Warranties.
Each Pledgor hereby covenants and agrees with, and represents and warrants to,
the Agent and the Lenders that:
(a) Each Pledgor is and shall be the sole and lawful legal, record
and beneficial owner of its Collateral. Each Pledgor's chief executive
office is at the address listed under such Pledgor's name on Schedule A,
Schedule B and Schedule C hereto, as applicable. Each Pledgor agrees that
it will not change any location set forth on the applicable Schedule hereto
without 30 days prior written notice to the Agent (provided in all cases
such locations shall be within the United States of America). No Pledgor
shall, without the Agent's prior written consent, sell, assign, or
otherwise dispose of the
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Collateral or any interest therein, except to the extent permitted by
Section 7.17 of the Credit Agreement. The Collateral, and every part
thereof, is and shall be free and clear of all security interests, liens,
rights, claims, attachments, levies and encumbrances of every kind, nature
and description and whether voluntary or involuntary, except for the
security interest of the Agent hereunder and for other Liens permitted by
Section 7.14 of the Credit Agreement. Each Pledgor shall warrant and defend
the Collateral against any claims and demands of all persons at any time
claiming the same or any interest in the Collateral adverse to the Agent or
any Lender.
(b) Each Pledgor agrees to execute and deliver to the Agent such
further agreements, assignments, instruments and documents and to do all
such other things as the Agent may deem reasonably necessary or appropriate
to assure the Agent its lien and security interest hereunder, including
such assignments, acknowledgments (including acknowledgments of collateral
assignment in the form attached hereto as Schedule D), stock powers,
financing statements, instruments and documents as the Agent may from time
to time require in order to comply with the UCC. Each Pledgor hereby
agrees that a carbon, photographic or other reproduction of this Agreement
or any such financing statement is sufficient for filing as a financing
statement by the Agent without prior notice thereof to such Pledgor
wherever the Agent in its discretion desires to file the same (and Agent
agrees to provide the relevant Pledgor notice after any such filing is made
pursuant to this provision, provided the failure to give such notice shall
not affect the validity or enforceability of the relevant filing). In the
event for any reason the law of any jurisdiction other than Illinois
becomes or is applicable to the Collateral or any part thereof, or to any
of the Obligations, each Pledgor agrees to execute and deliver all such
agreements, assignments, instruments and documents and to do all such other
things as the Agent in its discretion deems necessary or appropriate to
preserve, protect and enforce the lien and security interest of the Agent
under the law of such other jurisdiction.
(c) If, as and when any Pledgor (x) delivers any securities for
pledge hereunder in addition to those listed on Schedule A hereto or (y)
pledges interests in any partnership in addition to those listed on
Schedule B hereto or (z) pledges interests in any limited liability company
in addition to those listed on Schedule C hereto, the Pledgors shall
furnish to the Agent a duly completed and executed amendment to such
Schedule in substantially the form (with appropriate insertions) of
Schedule E hereto reflecting the additional securities, partnership
interests or limited liability company interests pledged hereunder after
giving effect to such addition.
(d) None of the Collateral constitutes margin stock (within the
meaning of Regulation U of the Board of Governors of the Federal Reserve
System).
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(e) On failure of any Pledgor to perform any of the agreements and
covenants herein contained, the Agent may at its option, after two (2)
Business Days prior notice to such Pledgor (unless in the reasonable
judgment of the Agent immediate payment or performance is necessary to
protect or preserve the Collateral or the Agent's interest therein),
perform the same and in so doing may expend such sums as the Agent
reasonably deems advisable in the performance thereof, including, without
limitation, the payment of any taxes, liens and encumbrances (except to the
extent the relevant Pledgor is contesting the same in good faith in
accordance with the terms of Section 7.3 of the Credit Agreement),
expenditures made in defending against any adverse claim, and all other
expenditures which the Agent may be compelled to make by operation of law
or which Agent may make by agreement or otherwise for the protection of the
security hereof. All such sums and amounts so expended shall be repayable
by the Pledgors immediately without notice or demand, shall constitute
additional Obligations secured hereunder and shall bear interest from the
date said amounts are expended at the rate per annum (computed on the basis
of a year of 365 or 366 days, as the case may be, for the actual number of
days elapsed) determined by adding 2% to the Domestic Rate (such rate per
annum as so determined being hereinafter referred to as the "Default
Rate"). No such performance of any covenant or agreement by the Agent on
behalf of such Pledgor, and no such advancement or expenditure therefor,
shall relieve such Pledgor of any default under the terms of this Agreement
or in any way obligate the Agent or any Lender to take any further or
future action with respect thereto. The Agent, in making any payment
hereby authorized, may do so according to any xxxx, statement or estimate
procured from the appropriate public office or holder of the claim to be
discharged without inquiry into the accuracy of such xxxx, statement or
estimate, or into the validity of any tax assessment, sale, forfeiture, tax
lien or title or claim. The Agent, in performing any act hereunder, shall
be the sole judge (which judgment shall be reasonably exercised) of whether
the relevant Pledgor is required to perform the same under the terms of
this Agreement. The Agent is hereby authorized to charge any depository or
other account of any Pledgor maintained with the Agent for the amount of
such sums and amounts so expended.
Section 5. Special Provisions Re: Stock Collateral.
(a) Each Pledgor has the right to vote the Pledged Securities and
there are no restrictions upon the voting rights associated with, or the
transfer of, any of the Pledged Securities, except as provided by federal
and state laws applicable to the sale of securities generally and the terms
of this Agreement.
(b) The certificates for all shares of the Pledged Securities shall
be delivered by the relevant Pledgor to the Agent duly endorsed in blank
for transfer or accompanied
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by an appropriate assignment or assignments or an appropriate undated stock
power or powers, in every case sufficient to transfer title thereto. The
Agent may at any time after the occurrence of an Event of Default cause to
be transferred into its name or into the name of its nominee or nominees
any and all of the Pledged Securities. The Agent shall at all times have
the right to exchange the certificates representing the Pledged Securities
for certificates of smaller or larger denominations.
(c) The Pledged Securities have been validly issued and, except as
described on Schedule A, are fully paid and non-assessable. Except as set
forth on Schedule A, there are no outstanding commitments or other
obligations of the issuers of any of the Pledged Securities to issue, and
no options, warrants or other rights of any individual or entity to
acquire, any share of any class or series of capital stock of such issuers.
The Pledged Securities listed and described on Schedule A attached hereto
constitute the percentage of the issued and outstanding capital stock of
each series and class of the issuers thereof as set forth thereon owned by
the relevant Pledgor. Each Pledgor further agrees that in the event any
such issuer shall issue any additional capital stock of any series or class
(whether or not entitled to vote) to such Pledgor or otherwise on account
of its ownership interest therein, each Pledgor will forthwith pledge and
deposit hereunder, or cause to be pledged and deposited hereunder, all such
additional shares of such capital stock.
Section 6. Special Provisions Re: Partnership Interest Collateral
and LLC Collateral.
(a) Each Pledgor further represents and warrants to, and agrees
with, the Agent and the Lenders as follows:
(i) each Partnership is a valid and existing entity of the
type listed on Schedule B and is duly organized and existing under
applicable law; and each LLC is duly organized and existing under
applicable law;
(ii) the Partnership Interest Collateral listed and described
on Schedule B attached hereto constitutes the percentage of the equity
interest in each Partnership set forth thereon owned by the relevant
Pledgor; and the LLC Collateral listed and described on Schedule C
attached hereto constitutes the percentage of the equity interest in
each LLC set forth thereon owned by the relevant Pledgor; and
(iii) the copies of the partnership agreements of each
Partnership and the articles of association and operating agreements
of each LLC (each such
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agreement being hereinafter referred to as "Organizational Agreement")
heretofore delivered to the Agent are true and correct copies thereof
and have not been amended or modified in any respect.
(b) Each Pledgor agrees that it shall not, without the prior written
consent of the Agent, agree to any amendment or modification to any of the
Organizational Agreements which would in any manner adversely affect or
impair the Partnership Interest Collateral or LLC Collateral or reduce or
dilute the rights of such Pledgor with respect to any Partnership or LLC,
any of such done without such prior written consent to be null and void.
The Pledgors shall promptly send to the Agent copies of all notices and
communications with respect to each Partnership and each LLC alleging the
existence of a default by any Pledgor in the performance of any of its
obligations under any Organizational Agreement. Each Pledgor agrees that
it will promptly notify the Agent of any litigation which is reasonably
likely to have a Material Adverse Effect or is reasonably likely to
materially and adversely affect a Partnership or a LLC or any of their
respective properties and of any material adverse change in the operations,
business properties, assets or conditions, financial or otherwise, of any
Pledgor or any Partnership or any LLC. Each Pledgor shall promptly perform
all of its obligations under each Organizational Agreement. In the event
any Pledgor fails to pay or perform any obligation arising under any
Organizational Agreement or otherwise related to any Partnership or any
LLC, the Agent may, but need not, after two (2) Business Days prior notice
to such Pledgor (unless in the reasonable judgment of the Agent immediate
payment or performance is necessary to protect or preserve the Collateral
or the Agent's interest therein), pay or perform such obligation at the
expense and for the account of the Pledgors and all funds expended for such
purposes shall constitute Obligations secured hereby which the Pledgors
promise to pay to the Agent together with interest thereon at the Default
Rate.
(c) The certificates, if any, at any time evidencing any Pledgor's
interest in any Partnership or LLC shall be delivered to the Agent duly
endorsed in blank for transfer or accompanied by an appropriate assignment
or assignments or an appropriate undated stock power or powers, in every
case sufficient to transfer title thereto. The Agent may at any time after
the occurrence of an Event of Default cause to be transferred into its name
or the name of its nominee or nominees, any and all of such Collateral.
The Agent shall at all times have the right to exchange the certificates
representing such Collateral for certificates of smaller or larger
denominations.
(d) Each Pledgor has the right to vote its interest in each
Partnership and LLC (except as set forth herein) and there are no
restrictions upon the voting rights associated with, or the transfer of,
any of the Partnership Interest Collateral or LLC Collateral,
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except as provided by federal and state laws applicable to the sale of
securities generally, the terms of any Organizational Agreement under which
such person is organized and the terms of this Agreement.
(e) Except as set forth on Schedule C, there are no outstanding
commitments or other obligations of any LLC to issue, and no options,
warrants or other rights of any individual or entity to acquire, any
interest in such LLC.
(f) Each Pledgor further agrees that in the event it shall acquire
any additional interests in any Partnership or LLC, such Pledgor will
forthwith pledge and deposit hereunder or cause to be pledged and deposited
hereunder, all such additional interests.
Section 7. Voting Rights and Dividends. Unless and until an Event of
Default hereunder has occurred and is continuing and thereafter until notified
by the Agent pursuant to Section 9(b) hereof:
(a) Each Pledgor shall be entitled to exercise all voting and/or
consensual powers pertaining to the Collateral of such Pledgor, or any part
thereof, for all purposes not inconsistent with the terms of this Agreement
or any other document evidencing or otherwise relating to any of the
Obligations.
(b) Each Pledgor shall be entitled to receive and retain all
dividends and distributions in respect of the Collateral which are paid in
cash of whatsoever nature; provided, however, that such dividends and
distributions representing:
(i) stock or liquidating dividends or a distribution or return
of capital upon or in respect of the Pledged Securities or any part
thereof or resulting from a split-up, revision or reclassification of
the Pledged Securities or any part thereof or received in addition to,
in substitution of or in exchange for the Pledged Securities or any
part thereof as a result of a merger, consolidation or otherwise; or
(ii) distributions in complete or partial liquidation of any
Partnership or LLC or the interest of such Pledgor therein;
in each case, shall be paid, delivered or transferred, as appropriate,
directly to the Agent immediately upon the receipt thereof by such Pledgor
and may, in the case of cash, be applied by the Agent to the Obligations,
whether or not the same may then be due or otherwise adequately secured and
shall, in the case of all other property, together with any cash received
by the Agent and not applied as aforesaid, be held by the Agent
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pursuant hereto as part of the Collateral pledged under and subject to the
terms of this Agreement.
(c) In order to permit each Pledgor to exercise such voting and/or
consensual powers which it is entitled to exercise under subsection (a)
above and to receive such distributions which such Pledgor is entitled to
receive and retain under subsection (b) above, the Agent will, if
necessary, upon the written request of such Pledgor, from time to time
execute and deliver to such Pledgor appropriate proxies and dividend
orders.
Section 8. Power of Attorney. Each Pledgor hereby appoints the
Agent, its nominee, or any other person whom the Agent may designate as such
Pledgor's attorney-in-fact, with full power and authority to ask, demand,
collect, receive, receipt for, xxx for, compound and give acquittance for any
and all sums or properties which may be or become due, payable or distributable
in respect of the Collateral or any part thereof, with full power to settle,
adjust or compromise any claim thereunder or therefor as fully as such Pledgor
could itself do, to endorse or sign the Pledgor's name on any assignments, stock
powers, or other instruments of transfer and on any checks, notes, acceptances,
money orders, drafts, and any other forms of payment or security that may come
into the Agent's possession and on all documents of satisfaction, discharge or
receipt required or requested in connection therewith, and, in its discretion,
to file any claim or take any other action or proceeding, either in its own name
or in the name of such Pledgor, or otherwise, which the Agent deems necessary or
appropriate to collect or otherwise realize upon all or any part of the
Collateral, or effect a transfer thereof, or which may be necessary or
appropriate to protect and preserve the right, title and interest of the Agent
in and to such Collateral and the security intended to be afforded hereby. Each
Pledgor hereby ratifies and approves all acts of any such attorney and agrees
that neither the Agent nor any such attorney will be liable for any such acts or
omissions nor for any error of judgment or mistake of fact or law other than
such person's gross negligence or willful misconduct. The Agent may file one or
more financing statements disclosing its security interest in all or any part of
the Collateral without any Pledgor's signature appearing thereon, and each
Pledgor also hereby grants the Agent a power of attorney to execute any such
financing statements, and any amendments or supplements thereto, on behalf of
such Pledgor without notice thereof to such Pledgor (and Agent agrees to provide
the relevant Pledgor notice after any such filing is made pursuant to this
provision, provided the failure to give such notice shall not affect the
validity or enforceability of the relevant filing). The foregoing powers of
attorney, being coupled with an interest, are irrevocable until the Obligations
have been fully satisfied and all commitments of the Lenders to extend credit to
or for the account of the Company have expired or otherwise been terminated;
provided, however, that the Agent agrees, as a personal covenant to the relevant
Pledgor, not to exercise the powers of attorney set forth in this Section unless
an Event of Default has occurred and is continuing.
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Section 9. Defaults and Remedies. (a) The occurrence of any event or
the existence of any condition which is specified as an "Event of Default" under
the Credit Agreement shall constitute an "Event of Default" hereunder.
(b) Upon the occurrence and during the continuation of any Event of
Default, all rights of the Pledgors to receive and retain the distributions
which they are entitled to receive and retain pursuant to Section 7(b) hereof
shall, at the option of the Agent cease and thereupon become vested in the Agent
which, in addition to all other rights provided herein or by law, shall then be
entitled solely and exclusively to receive and retain the distributions which
the Pledgors would otherwise have been authorized to retain pursuant to Section
7(b) hereof and all rights of the Pledgors to exercise the voting and/or
consensual powers which they are entitled to exercise pursuant to Section 7(a)
hereof shall, at the option of the Agent, cease and thereupon become vested in
the Agent which, in addition to all other rights provided herein or by law,
shall then be entitled solely and exclusively to exercise all voting and other
consensual powers pertaining to the Collateral and to exercise any and all
rights of conversion, exchange or subscription and any other rights, privileges
or options pertaining thereto as if the Agent were the absolute owner thereof
including, without limitation, the right to exchange, at its discretion, the
Collateral or any part thereof upon the merger, consolidation, reorganization,
recapitalization or other readjustment of the respective issuer thereof or upon
the exercise by or on behalf of any such issuer or the Agent of any right,
privilege or option pertaining to the Collateral or any part thereof and, in
connection therewith, to deposit and deliver the Collateral or any part thereof
with any committee, depositary, transfer agent, registrar or other designated
agency upon such terms and conditions as the Agent may determine. In the event
the Agent in good faith believes any of the Collateral constitutes restricted
securities within the meaning of any applicable securities law, any disposition
thereof in compliance with such laws shall not render the disposition
commercially unreasonable.
(c) Upon the occurrence and during the continuation of any Event of
Default, the Agent shall have, in addition to all other rights provided herein
or by law, the rights and remedies of a secured party under the UCC (regardless
of whether the UCC is the law of the jurisdiction where the rights or remedies
are asserted and regardless of whether the UCC applies to the affected
Collateral), and further the Agent may, without demand and without
advertisement, notice, hearing or process of law, all of which each Pledgor
hereby waives to the extent permitted by applicable law, at any time or times,
sell and deliver any or all of the Collateral held by or for it at public or
private sale, at any securities exchange or broker's board or at any of the
Agent's offices or elsewhere, for cash, upon credit or otherwise, at such prices
and upon such terms as the Agent deems advisable, in its sole discretion. In
the exercise of any such remedies, the Agent may sell the Collateral as a unit
even though the sales price thereof may be in excess of the amount remaining
unpaid on the Obligations. Also, if less than all the Collateral is sold, the
Agent shall have no duty to marshal or apportion the part of the Collateral so
sold as between the
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Pledgors, or any of them, but may sell and deliver any or all of the Collateral
without regard to which of the Pledgors are the owners thereof. In addition to
all other sums due the Agent or any Lender hereunder, each Pledgor shall pay the
Agent and the Lenders all reasonable costs and expenses incurred by the Agent
and such Lenders, including reasonable attorneys' fees and court costs, in
obtaining, liquidating or enforcing payment of Collateral or the Obligations or
in the prosecution or defense of any action or proceeding by or against the
Agent, the Lenders or any Pledgor concerning any matter arising out of or
connected with this Agreement or the Collateral or the Obligations including,
without limitation, any of the foregoing arising in, arising under or related to
a case under the United States Bankruptcy Code (or any successor statute). Any
requirement of reasonable notice shall be met if such notice is personally
served on or mailed, postage prepaid, to the Pledgors in accordance with Section
14(b) hereof at least 10 days before the time of sale or other event giving rise
to the requirement of such notice; provided, however, no notification need be
given to a Pledgor if such Pledgor has signed, after an Event of Default has
occurred, a statement renouncing any right to notification of sale or other
intended disposition. The Agent shall not be obligated to make any sale or other
disposition of the Collateral regardless of notice having been given. The Agent
or any Lender may be the purchaser at any such sale. Each Pledgor hereby waives
all of its rights of redemption from any such sale. Subject to the provisions of
applicable law, the Agent may postpone or cause the postponement of the sale of
all or any portion of the Collateral by announcement at the time and place of
such sale, and such sale may, without further notice, be made at the time and
place to which the sale was postponed or the Agent may further postpone such
sale by announcement made at such time and place.
Each Pledgor agrees that if any part of the Collateral is sold at any
public or private sale, the Agent may elect to sell only to a buyer who will
give further assurances, satisfactory in form and substance to the Agent,
respecting compliance with the requirements of the Federal Securities Act of
1933, as amended, and a sale subject to such condition shall be deemed
commercially reasonable.
Each Pledgor further agrees that in any sale of any part of the
Collateral, the Agent is hereby authorized to comply with any limitation or
restriction in connection with such sale as it may be advised by counsel is
necessary in order to avoid any violation of applicable law (including, without
limitation, compliance with such procedures as may restrict the number of
prospective bidders and purchasers and/or further restrict such prospective
bidders or purchasers to persons who will represent and agree that they are
purchasing for their own account for investment and not with a view to the
distribution or resale of such Collateral), or in order to obtain any required
approval of the sale or of the Purchaser by any governmental regulatory
-12-
authority or official, and each Pledgor further agrees that such compliance
shall not result in such sale being considered or deemed not to have been made
in a commercially reasonable manner, nor shall the Agent be liable or
accountable to any Pledgor for any discount allowed by reason of the fact that
such collateral is sold in compliance with any such limitation or restriction.
(d) In the event the Agent shall sell or otherwise dispose of all or any
part of the Partnership Interest Collateral or LLC Collateral, each Pledgor
hereby grants the purchaser of such portion of the Partnership Interest
Collateral or LLC Collateral to the fullest extent of its capacity, the ability
(but not the obligation) to become a partner or member in the relevant
Partnership or LLC, as the case may be (subject to the approval of the relevant
Partnership or LLC, as the case may be, in the exercise of its discretion in
accordance with its Organizational Agreement), in the place and stead of such
Pledgor. To exercise such right, the purchaser shall give written notice to the
relevant Partnership or LLC, as the case may be, of its election to become a
partner or member in such Partnership or LLC. Following such election and
giving of consent by all necessary partners or members of the relevant
Partnership or LLC as to the purchaser becoming a partner or member, the
purchaser shall have the right and powers and be subject to the liabilities of a
partner or member under the relevant Organizational Agreement and the
partnership or limited liability company act governing the Partnership or LLC.
(e) Upon the occurrence and during the continuation of any Event of
Default, in addition to all other rights provided herein or by law, the Agent
shall have the right to cause all or any part of the Partnership Interest
Collateral or LLC Collateral of any of the Pledgors in any one or more of the
Partnerships or LLCs to be redeemed and to cause a withdrawal, in whole or in
part, of any Pledgor from any Partnership or LLC or any of its interest therein.
(f) The powers conferred upon the Agent hereunder are solely to protect
its interest in the Collateral and shall not impose on it any duties to exercise
such powers. The Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession if the Collateral
is accorded treatment substantially equivalent to that which the Agent accords
its own property, consisting of similar types securities, it being understood,
however, that the Agent shall have no responsibility for (i) ascertaining or
taking any action with respect to calls, conversions, exchanges, maturities,
tenders or other matters relating to any Collateral, whether or not the Agent
has or is deemed to have knowledge of such matters, (ii) taking any necessary
steps to preserve rights against any parties with respect to any Collateral, or
(iii) initiating any action to protect the Collateral or any part thereof
against the possibility of a decline in market value. This Agreement
constitutes an assignment of rights only and not an assignment of any duties or
obligations of the Pledgors in any way related to the Collateral, and the Agent
shall have no duty or obligation to discharge any such duty or obligation. By
its acceptance hereof, the Agent does not undertake to perform or discharge and
shall not be
-13-
responsible or liable for the performance or discharge of any such duties or
responsibilities and shall not in any event become a "Substituted Limited
Partner" or words of like import (as defined in the relevant Organizational
Agreement) in the relevant Partnership. Neither the Agent nor any Lender, nor
any party acting as attorney for the Agent or any Lender, shall be liable
hereunder for any acts or omissions or for any error of judgment or mistake of
fact or law other than such person's gross negligence or willful misconduct.
(g) Failure by the Agent to exercise any right, remedy or option under
this Agreement or any other agreement between any Pledgor and the Agent or
provided by law, or delay by the Agent in exercising the same, shall not operate
as a waiver; and no waiver shall be effective unless it is in writing, signed by
the party against whom such waiver is sought to be enforced and then only to the
extent specifically stated. The rights and remedies of the Agent and the
Lenders under this Agreement shall be cumulative and not exclusive of any other
right or remedy which the Agent or the Lenders may have. For purposes of this
Agreement, an Event of Default shall be construed as continuing after its
occurrence until the same is waived in writing by the Lenders or the Required
Lenders, as the case may be, in accordance with the Credit Agreement.
Section 10. Application of Proceeds. The proceeds and avails of the
Collateral at any time received by the Agent upon the occurrence and during the
continuation of any Event of Default shall, when received by the Agent in cash
or its equivalent, be applied by the Agent in reduction of, or held as
collateral security for, the Obligations in accordance with the terms of the
Credit Agreement. The Pledgors shall remain liable to the Agent and the Lenders
for any deficiency. Any surplus remaining after the full payment and
satisfaction of the Obligations shall be returned to the Company, as agent for
Pledgors, or to whomsoever the Agent reasonably determines is lawfully entitled
thereto.
Section 11. Continuing Agreement. This Agreement shall be a
continuing agreement in every respect and shall remain in full force and effect
until all of the Obligations, both for principal and interest, have been fully
paid and satisfied and the commitments of the Lenders to extend credit to or for
the account of the Company shall have expired or otherwise terminated. Upon
such termination of this Agreement, the Agent shall, upon the request and at the
expense of the Pledgors, forthwith release all its liens and security interests
hereunder.
Section 12. Primary Security; Obligations Absolute. The lien and
security herein created and provided for stand as direct and primary security
for the Obligations. No application of any sums received by the Agent in
respect of the Collateral or any disposition thereof to the reduction of the
Obligations or any portion thereof shall in any manner entitle any Pledgor to
any right, title or interest in or to the Obligations or any collateral security
therefor, whether by subrogation or otherwise, unless and until all Obligations
have been fully paid and satisfied and all commitments to extend credit
constituting Obligations to the Company shall have expired or
-14-
otherwise terminated. Each Pledgor acknowledges and agrees that the lien and
security hereby created and provided for are absolute and unconditional and
shall not in any manner be affected or impaired by any acts or omissions
whatsoever of the Agent, any Lender or any other holder of any of the
Obligations, and without limiting the generality of the foregoing, the lien and
security hereof shall not be impaired by any acceptance by the Agent, any Lender
or any other holder of any of the Obligations of any other security for or
guarantors upon any Obligations or by any failure, neglect or omission on the
part of the Agent, any Lender or any other holder of any of the Obligations to
realize upon or protect any of the Obligations or any collateral security
therefor. The lien and security hereof shall not in any manner be impaired or
affected by (and the Agent and the Lenders, without notice to anyone, are hereby
authorized to make from time to time) any sale, pledge, surrender, compromise,
settlement, release, renewal, extension, indulgence, alteration, substitution,
exchange, change in, modification or disposition of any of the Obligations, or
of any collateral security therefor, or of any guaranty thereof, or of any
instrument or agreement setting forth the terms and conditions pertaining to any
of the foregoing. The Lenders may at their discretion at any time grant credit
to the Company without notice to the other Pledgors in such amounts and on such
terms as the Lenders may elect without in any manner impairing the lien and
security hereby created and provided for. In order to realize hereon and to
exercise the rights granted the Agent and the Lenders hereunder and under
applicable law, there shall be no obligation on the part of the Agent, any
Lender or any other holder of any of the Obligations at any time to first resort
for payment to the Company or any other Pledgor or to any guaranty of the
Obligations or any portion thereof or to resort to any other collateral
security, property, liens or any other rights or remedies whatsoever, and the
Agent and the Lenders shall have the right to enforce this Agreement as against
any Pledgor or any of its Collateral irrespective of whether or not other
proceedings or steps seeking resort to or realization upon or from any of the
foregoing are pending.
Section 13. The Agent. In acting under or by virtue of this
Agreement, Agent shall be entitled to all the rights, authority, privileges and
immunities provided in Section 10 of the Credit Agreement, all of which
provisions of said Section 10 are incorporated by reference herein with the same
force and effect as if set forth herein in their entirety. The Agent hereby
disclaims any representation or warranty to the Lenders or any other holders of
the Obligations concerning the perfection of the liens and security interests
granted hereunder or in the value of the Collateral.
Section 14. Miscellaneous. (a) This Agreement cannot be changed or
terminated orally. This Agreement shall create a continuing lien on and
security interest in the Collateral and shall be binding upon each Pledgor, its
successors and permitted assigns, and shall inure, together with the rights and
remedies of the Agent and the Lenders hereunder, to the benefit of the Agent and
the Lenders, and their successors and assigns; provided, however, that no
Pledgor may assign its rights or delegate its duties hereunder without the
Agent's prior written consent
-15-
(except for such assignments and assumptions arising as a matter of law as a
result of a merger permitted by Section 7.16(c) of the Credit Agreement).
Without limiting the generality of the foregoing, and subject to the provisions
of the Credit Agreement, any Lender may assign or otherwise transfer any
indebtedness held by it secured by this Agreement to any other person, and such
other person shall thereupon become vested with all the benefits in respect
thereof granted to such Lender herein or otherwise.
(b) All communications provided for herein shall be in writing, except as
otherwise specifically provided for hereinabove, and shall be deemed to have
been given or made, if to any Pledgor when given to the Company in accordance
with Section 11.9 of the Credit Agreement, or if to the Agent or any Lender,
when given to such party in accordance with Section 11.9 of the Credit
Agreement.
(c) No Lender shall have the right to institute any suit, action or
proceeding in equity or at law for the foreclosure or other realization upon any
Collateral subject to this Agreement or for the execution of any trust or power
hereof or for the appointment of a receiver, or for the enforcement of any other
remedy under or upon this Agreement; it being understood and intended that no
one or more of the Lenders shall have any right in any manner whatsoever to
affect, disturb or prejudice the lien and security interest of this Agreement by
its or their action or to enforce any right hereunder, and that all proceedings
at law or in equity shall be instituted, had and maintained by the Agent in the
manner herein provided for the benefit of the Lenders.
(d) In the event that any provision hereof shall be deemed to be invalid
or unenforceable by reason of the operation of any law or by reason of the
interpretation placed thereon by any court, this Agreement shall be construed as
not containing such provision, but only as to such jurisdictions where such law
or interpretation is operative, and the invalidity or unenforceability of such
provision shall not affect the validity of any remaining provision hereof, and
any and all other provisions hereof which are otherwise lawful and valid shall
remain in full force and effect. Without limiting the generality of the
foregoing, in the event that this Agreement shall be deemed to be invalid or
otherwise unenforceable with respect to any Pledgor, such invalidity or
unenforceability shall not affect the validity of this Agreement with respect to
the other Pledgors.
(e) In the event the Agent and the Lenders shall at any time in their
discretion permit a substitution of Pledgors hereunder or a party shall wish to
become a Pledgor hereunder, such substituted or additional Pledgor shall, upon
executing an agreement in the form attached hereto as Schedule F, become a party
hereto and be bound by all the terms and conditions hereof to the same extent as
though such Pledgor had originally executed this Agreement and, in the case of a
substitution, in lieu of the Pledgor being replaced. No such substitution shall
be effective absent
-16-
the written consent of Agent nor shall it in any manner affect the obligations
of the other Pledgors hereunder.
(f) Upon the execution and delivery of this Agreement by the Pledgors
hereunder, this Agreement shall as of such date supersede all provisions of the
various Pledge Agreements executed by certain Pledgors prior to the date hereof
(the "Prior Pledge Agreements"). The Pledgors hereby agree that,
notwithstanding the execution and delivery of this Agreement, the liens and
security interests created and provided for under the Prior Pledge Agreements
continue in effect under and pursuant to the terms of this Agreement for the
benefit of all of the Obligations secured hereby. Nothing herein contained
shall in any manner affect or impair the priority of the liens and security
interests created and provided for by the Prior Pledge Agreements as to the
indebtedness and obligations which would otherwise be secured thereby prior to
giving effect to this Agreement.
(g) Each Pledgor hereby submits to the non-exclusive jurisdiction of the
United States District Court for the Northern District of Illinois and of any
Illinois state court sitting in the City of Chicago for purposes of all legal
proceedings arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated hereby or thereby. Each Pledgor
irrevocably waives, to the fullest extent permitted by law, any objection which
it may now or hereafter have to the laying of the venue of any such proceeding
brought in such a court and any claim that any such proceeding brought in such a
court has been brought in an inconvenient form. Each Pledgor, the Agent, and
each Lender hereby irrevocably waives any and all right to trial by jury in any
legal proceeding arising out of or relating to this Agreement, any other Loan
Document or the transactions contemplated hereby or thereby.
(h) This Agreement shall be deemed to have been made in the State of
Illinois and shall be governed by, and construed in accordance with, the laws of
the State of Illinois. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning of any
provision hereof.
(i) This Agreement may be executed in any number of counterparts and by
different parties hereto on separate counterpart signature pages, each
constituting an original, but all together one and the same instrument.
[Signature Pages to Follow]
-17-
In Witness Whereof, each Pledgor has caused this Agreement to be duly
executed and delivered as of the date first above written.
"Pledgors"
Everest Healthcare Services
Corporation
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
WSKC Dialysis Services, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
Asst. Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Ohio Valley Dialysis Center, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
Secretary/Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
-18-
Northwest Indiana Dialysis, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
Asst. Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
New York Dialysis Management, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Mercy Dialysis Center, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
Asst. Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
DuPage Dialysis, Ltd.
/s/ Xxxx X. Xxxxxx
By____________________________________
Asst. Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
-19-
Lake Avenue Dialysis Center, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
Asst. Treasurer
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Home Dialysis of America, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Amarillo Acute Dialysis Specialists,
L.L.C.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Dialysis Specialists of Corpus Christi,
L.L.C.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
-20-
Home Dialysis of Eastagate, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Dialysis Services of Cincinnati, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Dialysis Specialists of Marietta, Ltd.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Saint Xxxxxxxx Mercy Dialysis
Centers, L.L.C.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
-21-
Everest Management, Inc.
/s/ Xxxx X. Xxxxxx
By____________________________________
CFO
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
The Extracorporeal Alliance, L.L.C.
/s/ Xxxx X. Xxxxxx
By____________________________________
Secretary
Its________________________________
Address:
000 Xxxxx Xxxxxxxx
Xxx Xxxx, Xxxxxxxx 00000
Attention: Xx. Xxxx X. Xxxxxx
Acknowledged and agreed to in Chicago, Illinois as of the date first above
written.
Xxxxxx Trust and Savings Bank, as Agent as
aforesaid for the Lenders
/s/ Xxxxxxx X. Xxxxx
By____________________________________
Senior Vice President
Its________________________________
Address:
000 Xxxx Xxxxxx Xxxxxx, 0X
X.X. Xxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxx
-22-
Schedule A to Pledge Agreement
The Pledged Securities
Percentage of
Name and Name of Issuer Jurisdiction No. of Certificate Issuer's
Location of of Shares Class No. Stock
Pledgor Incorporation
Everest Healthcare WSKC Dialysis Illinois 315 Common 27 100%
Services Corporation Services, Inc.
000 Xxxxx Xxxxxxxx 11,617,200 Preferred 00
Xxx Xxxx, XX 00000
Xxxx Xxxxxx Xxxxxxx 1,000 Common 11 100%
Dialysis Center,
Inc.
Northwest Indiana 1,000 Common 12 100%
Indiana Dialysis,
Inc.
New York New York 4,928 Common 43 100%
Dialysis
Management,
Inc.
Mercy Dialysis Wisconsin 56 Common 10 100%
Center, Inc.
DuPage Dialysis, Illinois 1,000 Common 12 100%
Ltd.
Lake Avenue Indiana 117.75 Common 12 100%
Dialysis Center,
Inc.
Home Dialysis of Arizona 25,000 Common 9 100%
America, Inc.
Everest Delaware 1,000 Common 1 100%
Management,
Inc.
Home Dialysis of Home Dialysis of Ohio 95 Common 1 95%
America, Inc. Eastgate, Inc.
0000 Xxxx Xx Xxxxxx
Xxxxx, Xxxxx 000
Xxxxxx, XX 00000
Dialysis Services Ohio 75 Common 1 65%
of Cincinnati,
Inc. 120 Common 6
-2-
Schedule B to Pledge Agreement
Partnership Interest Collateral
Name and Location of Name of Type of Jurisdiction Percent of
Pledgor Partnership Organization of Organization Ownership
None
Schedule C to Pledge Agreement
LLC Collateral
Percentage of
Equity
Interest Owned
Name and Location of Jurisdiction of by
Pledgor Name of LLC Organization Pledgor
I. Everest Healthcare Services 1. Saint Xxxxxxxx Mercy Illinois 80%
Corporation Dialysis Centers, L.L.C.
000 Xxxxx Xxxxxxxx
Xxx Xxxx, XX 00000 2. The Extracorporeal Delaware 100%
Alliance, L.L.C.
II Home Dialysis of America, 1. Amarillo Acute Dialysis Texas 100%
Inc. Specialists, L.L.C.
0000 Xxxx Xx Xxxxxx Xxxxx
Xxxxx 000 2. Dialysis Specialists of Texas 100%
Xxxxxx, XX 00000 Corpus Christi, L.L.C.
3. Dialysis Specialists of Ohio 51%
Marietta, Ltd.
Schedule D to Pledge Agreement
Acknowledgment to Collateral Assignment
____________, 199__
_________________________________
_________________________________
_________________________________
_________________________________
Attention:_______________________
Ladies and Gentlemen:
___________________ ("Pledgor") executed an Amended and Restated Pledge
Agreement dated as of May 15, 1997 (the "Pledge Agreement") in favor of Xxxxxx
Trust and Savings Bank (the "Agent"), a copy of which you have received.
Pursuant to the Pledge Agreement, Pledgor assigned its equity interests in
___________________ (the "Partnership/LLC") as collateral security for, among
other things, indebtedness and obligations of Everest Healthcare Services
Corporation (the "Company") now or from time to time owing pursuant to that
certain Amended and Restated Credit Agreement dated as of May 15, 1997 (such
Credit Agreement as the same may be amended, modified or restated from time to
time being hereinafter referred to as the "Credit Agreement") among the Company,
the Agent, and various other lenders party thereto.
We ask you, by accepting this letter below on behalf of the Partnership/LLC
and as its general partner/manager, to confirm the following:
1. Pledgor is a partner/member in the Partnership/LLC.
2. You consent to the collateral assignment of Pledgor's interest in
the Partnership/LLC to the Agent, notwithstanding anything to the contrary
contained in the Partnership Agreement/Limited Liability Company Articles
of Association and Operating Agreement. This letter will serve to evidence
the consent to this collateral assignment from the Partnership/LLC and its
general partner/manager.
3. All parties required by the terms of the Partnership Agreement/
Limited Liability Company Articles of Association and Operating Agreement
to approve the
collateral assignment made by the Pledge Agreement have done so, and the
interest of the Agent by virtue of that assignment has been reflected on
the books and records of the Partnership/LLC.
4. The Partnership/LLC has been formed under the Partnership
Agreement dated as of ______________, 19__/the Articles of Association
dated ______________, 19__, and the Operating Agreement dated as of
________________, 19___ (the "Organizational Documents"), and the
Organizational Documents have not subsequently been modified or amended and
continue in full force and effect. The Organizational Documents shall not
be amended without the consent of the Agent. The Agent agrees with the
Partnership/LLC that the Agent will not unreasonably withhold its consent
to modifications or amendments to the Organizational Documents which do not
adversely affect the interests of the Agent or of the Lenders identified
and defined in the Pledge Agreement.
5. All payments and distributions due and to become due to Pledgor
pursuant to the Organizational Documents shall continue to be paid directly
to such Pledgor, unless and until the Agent notifies the Partnership/LLC in
writing to do otherwise. If the Agent so notifies the Partnership/LLC, the
Partnership/LLC will immediately cease making such payments and
distributions to the Pledgor and will as soon as possible, but in any event
within 5 days after receiving such notice, remit all such payments and
distributions directly to the Agent at 000 Xxxx Xxxxxx Xxxxxx, X.X. Xxx
000, Xxxxxxx, Xxxxxxxx 00000.
6. By virtue of the Pledge Agreement, the Agent has the right, upon
the occurrence and during the continuation of any Event of Default under
the Credit Agreement, at its option to exercise Pledgor's right (if any) to
withdraw all or any part of such Pledgor's interest in the Partnership/LLC
by so notifying the Partnership/LLC in writing no less than 10 days prior
to the proposed withdrawal date. All payments and distributions due or to
become due under the Organizational Documents to the Pledgor as a result of
such withdrawal shall be remitted directly to the Agent as stated above.
If given at all, the notice provided pursuant to this paragraph may (but
need not) be given concurrently with any notice provided pursuant to the
immediately preceding paragraph.
7. The Pledgor agrees that any such payment to the Agent shall be a
good receipt and acquittance as against it -- that is to say, the
Partnership/LLC should make the payment directly to the Agent and in so
doing, the Partnership/LLC discharges any liability to such Pledgor for
that payment.
-2-
8. The terms of the Pledge Agreement prohibit Pledgor from making
any transfer of its interest in the Partnership/LLC without the Agent's
prior written consent (except for such transfers arising in connection with
a merger permitted by Section 7.16(c) of the Credit Agreement). You agree
not to honor any such transfer of Pledgor's interest without the Agent's
prior written consent.
The agreements in this letter shall be modified only in a writing signed by
the Agent, the Pledgor and the Partnership/LLC. We acknowledge that the
Partnership/LLC shall be entitled to assume that the Pledge Agreement continues
in full force and effect unless and until the Partnership/LLC receives actual
written notice of a termination of same from the Agent.
Very truly yours,
[Pledgor]
By
Its____________________________________
Xxxxxx Trust and Savings Bank, as
Agent
By
Its____________________________________
The undersigned, both as the general partner/manager of the Partnership/LLC
and on behalf of the Partnership/LLC, join in this letter to evidence their
acknowledgment and agreement to the same.
[Partnership/LLC]
-3-
By
Its____________________________________
[General Partner/Manager of
Partnership]
By
Its____________________________________
-4-
Schedule E to Pledge Agreement
Amendment to Pledge Agreement
Reference is hereby made to that certain Amended and Restated Pledge
Agreement dated as of May 15, 1997 (as the same may be amended, the "Pledge
Agreement"), from the Pledgors which are signatories thereto to and Xxxxxx Trust
and Savings Bank, as Agent. Capitalized terms not otherwise defined herein shall
have the meaning set forth in the Pledge Agreement.
Subsequent to the Pledgors' delivery of the Pledge Agreement, certain
shares of stock, partnership interests or limited liability company interests
have been added as Collateral under the Pledge Agreement. As a result of such
addition, Schedule A of the Pledge Agreement does not accurately describe the
shares of capital stock and/or Schedule B does not accurately describe the
partnership interests and/or Schedule C does not accurately describe the limited
liability company interests, currently held by the Agent as collateral under the
Pledge Agreement.
The Pledgors now desire to amend Schedule A and/or Schedule B and/or
Schedule C to the Pledge Agreement to reflect such addition, and this instrument
shall constitute an agreement between the Pledgors and the Agent amending the
Pledge Agreement in the respects, but only in the respects, hereinafter set
forth:
1. If an Annex A is attached hereto, Schedule A of the Pledge
Agreement shall be and hereby is amended and as so amended shall be
restated in its entirety to read as Annex A attached hereto.
2. If an Annex B is attached hereto, Schedule B of the Pledge
Agreement shall be and hereby is amended and as so amended shall be
restated in its entirety to read as Annex B attached hereto.
3. If an Annex C is attached hereto, Schedule C of the Pledge
Agreement shall be and hereby is amended and as so amended shall be
restated in its entirety to read as Annex C attached hereto.
4. As collateral security for the Obligations, each Pledgor hereby
grants to the Agent a continuing lien on and security interest in, and
acknowledges and agrees that the Agent has and shall continue to have a
continuing lien on and security interest in, all the shares of capital
stock of each issuer listed and described on Annex A attached hereto (if
attached), all of the partnership interests listed and described on Annex B
attached hereto (if attached), all of the limited liability company
interests listed and described on
Annex C attached hereto (if attached) and all the other properties, rights,
interests and privileges comprising the Collateral (as such term is defined
in the Pledge Agreement after giving effect to this Amendment), to the same
extent and with the same force and effect as if (i) the shares of stock
described on Annex A had originally been included on Schedule A to the
Pledge Agreement, (ii) the partnership interests described on Annex B had
been originally included on Schedule B to the Pledge Agreement and (iii)
the limited liability company interests described on Annex C had been
originally included on Schedule C to the Pledge Agreement. The foregoing
granting clause is in addition to and supplemental of and not in
substitution for the granting clause contained in the Pledge Agreement.
Neither the Pledgors nor the Agent intends by this Amendment to in any way
impair or otherwise affect the lien of the Pledge Agreement on such of the
Collateral which was subject to the Pledge Agreement prior to giving effect
to this Amendment.
5. Each Pledgor hereby repeats and reaffirms all of its covenants,
agreements, representations and warranties contained in the Pledge
Agreement, each and all of which shall be applicable to all of the
properties, rights, interests and privileges subject to the lien of the
Pledge Agreement after giving effect to this Amendment. Each Pledgor hereby
certifies that no Event of Default or event which, with notice or lapse of
time or both, would constitute an Event of Default exists under the Pledge
Agreement after giving effect to this Amendment.
6. No reference to this Amendment need be made in any note,
instrument or other document at any time referring to the Pledge Agreement,
any reference in any of such to the Pledge Agreement to be deemed to
reference to the Pledge Agreement as modified hereby.
7. Except as specifically modified hereby, all the terms and
conditions of the Pledge Agreement shall stand and remain unchanged and in
full force and effect.
Pledgor(s):
[Name of Relevant Pledgors]
By
Its____________________________
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Acknowledged and agreed to as of the date first above written.
Xxxxxx Trust and Savings Bank, as
Agent
By
Its________________________________
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Annex A
to Amendment to Pledge Agreement
The Pledged Securities
Name and Percentage
Location of Name of Jurisdiction of No. of Certificate of Issuer's
Pledgor Issuer Incorporation Shares Class No. Stock
Annex B
to Amendment to Pledge Agreement
Partnership Interests
Name and Location of Name of Type of Jurisdiction Percent of
Pledgor Partnership Organization of Organization Ownership
Annex C
to Amendment to Pledge Agreement
Percentage of Equity
Name and Location of Jurisdiction of Interest Owned by
Pledgor Name of LLC Organization Pledgor
Schedule F to Pledge Agreement
Assumption and Supplemental Pledge Agreement
This Agreement dated as of this _____ day of ______________, 199___ from
[new Pledgor], a __________ corporation/partnership/limited liability company
(the "New Pledgor"), to Xxxxxx Trust and Savings Bank ("Xxxxxx") as agent for
the Lenders (defined in the Pledge Agreement hereinafter identified and defined)
(Xxxxxx acting as such agent and any successor or successors to Xxxxxx in such
capacity being hereinafter referred to as the "Agent");
Preliminary Statements
A. Everest Healthcare Services Corporation, a Delaware corporation (the
"Company") and certain other Pledgors have executed and delivered to the Agent
that certain Amended and Restated Pledge Agreement dated as of May 15, 1997
(such Amended and Restated Pledge Agreement, as the same may from time to time
be modified or amended, including supplements thereto which add additional
parties as Pledgors thereunder, being hereinafter referred to as the "Pledge
Agreement") pursuant to which such parties (the "Existing Pledgors") have
granted to the Agent for the benefit of itself and the other Lenders a lien on
and security interest in such Existing Pledgors' Collateral (as such term is
defined in the Pledge Agreement) to secure the Obligations (as such term is
defined in the Pledge Agreement);
B. Each Pledgor will benefit, directly and indirectly, from credit and
other financial accommodations extended by the Lenders to the Company.
Now, therefore, for value received, and in consideration of advances made
or to be made, or credit accommodations given or to be given, to the Company by
the Lenders from time to time, the New Pledgor hereby agrees as follows:
1. The New Pledgor acknowledges and agrees that it shall become a
"Pledgor" party to the Pledge Agreement effective upon the date the New
Pledgor's execution of this Agreement and the delivery of this Agreement to the
Agent, and that upon such execution and delivery, all references in the Pledge
Agreement to the terms "Pledgor" or "Pledgors" shall be deemed to include the
New Pledgor. Without limiting the generality of the foregoing, the New Pledgor
hereby repeats and reaffirms all grants (including the grant of a lien and
security interest), covenants, agreements, representations and warranties
contained in the Pledge Agreement as amended hereby, each and all of which are
and shall remain applicable to the Collateral from time to time owned by the New
Pledgor or in which the New Pledgor from time to time has any rights. Without
limiting the foregoing, in order to secure payment of the Obligations, whether
now existing or hereafter arising, the New Pledgor does hereby grant to the
Agent for the benefit of itself and the Lenders, and hereby agrees that the
Agent has and shall continue to have for the benefit of itself and the Lenders a
continuing security interest in, among other things, all of the New Pledgor's
Collateral (as such term is defined in the Pledge Agreement) described in
Section 2 of the Pledge Agreement, each and all of such granting clauses being
incorporated herein by reference with the same force and effect as if set forth
in their entirety except that all references in such clauses to the Existing
Pledgor or any of them shall be deemed to include references to the New Pledgor.
Nothing contained herein shall in any manner impair the priority of the liens
and security interests heretofore granted in favor of the Agent under the Pledge
Agreement.
2. The following information shall be added to Schedules A, B and/or C to
the Pledge Agreement, as applicable:
Schedule A
The Pledged Securities
Percentage
Name and Name of Jurisdiction of No. of Certificate of Issuer's
Location of Issuer Incorporation Shares Class No. Stock
Pledgor
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Or
Schedule B
Partnership Interest Collateral
Name and Location of Name of Type of Jurisdiction Percent of
Pledgor Partnership Organization of Organization Ownership
Or
Schedule C
LLC Collateral
Percentage of Equity
Name and Location of Jurisdiction of Interest Owned by
Pledgor Name of LLC Organization Pledgor
3. The New Pledgor hereby acknowledges and agrees that the Obligations
are secured by all of the Collateral according to, and otherwise on and subject
to, the terms and conditions of the Pledge Agreement to the same extent and with
the same force and effect as if the New Pledgor had originally been one of the
Existing Pledgors under the Pledge Agreement and had originally executed the
same as such an Existing Pledgor.
4. All capitalized terms used in this Agreement without definition shall
have the same meaning herein as such terms have in the Pledge Agreement, except
that any reference to the term "Pledgor" or "Pledgors" and any provision of the
Pledge Agreement providing meaning to such term shall be deemed a reference to
the Existing Pledgors and the New Pledgor. Except as specifically modified
hereby, all of the terms and conditions of the Pledge Agreement shall stand and
remain unchanged and in full force and effect.
5. The New Pledgor agrees to execute and deliver such further instruments
and documents and do such further acts and things as the Agent may reasonably
deem necessary or proper to carry out more effectively the purposes of this
Agreement.
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6. No reference to this Agreement need be made in the Pledge Agreement or
in any other document or instrument making reference to the Pledge Agreement,
any reference to the Pledge Agreement in any of such to be deemed a reference to
the Pledge Agreement as modified hereby.
7. This Agreement shall be governed by and construed in accordance with
the State of Illinois (without regard to principles of conflicts of law).
[New Pledgor]
By
Its_____________________________________
Acknowledged and agreed to as of the date first above written.
Xxxxxx Trust and Savings Bank, as
Agent
By
Its_____________________________________
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