1
EXHIBIT 10.2
SECURITY AGREEMENT
AGREEMENT dated as of December 23, 1997 among MEDAPHIS CORPORATION
(with its successors, the "COMPANY"), each SUBSIDIARY GUARANTOR party hereto or
which hereafter becomes a party hereto (with its successors, a "GRANTOR" and
together with the Company, collectively, the "GRANTORS"), [MED FUNDING, INC.]
(with its successors, "PURCHASER") on behalf of itself and as Collateral Agent
(with its successors in such capacity, the "COLLATERAL AGENT") for the Secured
Parties referred to below and, if it shall become a party hereto pursuant to
Section 21, [WACHOVIA BANK, N.A.] (with its successors, ["WACHOVIA"]).
W I T N E S S E T H :
WHEREAS, the Company, the Subsidiary Guarantors and Purchaser are parties
to a Note Purchase Agreement of even date herewith (as the same may be amended
from time to time, the "NOTE PURCHASE AGREEMENT");
WHEREAS, in order to induce Purchaser to enter into the Note Purchase
Agreement and to purchase the Notes issued pursuant to the Note Purchase
Agreement, each of the Subsidiary Guarantors has guaranteed, pursuant to the
Note Purchase Agreement and subject to the limitations contained therein, all of
the obligations of the Company under the Notes and the other Financing Documents
(as defined in the Note Purchase Agreement); and
WHEREAS, in order to induce Purchaser to enter into the Note Purchase
Agreement and to purchase the Notes issued pursuant to the Note Purchase
Agreement, each Grantor has agreed to grant a continuing security interest in
and to all of its right, title and interest in and to the Collateral (as
hereafter defined) to secure its obligations under the Financing Documents; and
WHEREAS, [Wachovia] and its affiliates provide cash management services
for the Company and its Subsidiaries, and each Grantor has agreed to grant a
continuing security interest in and to all of its right, title and interest in
and to the Collateral to secure its Cash Management Services Obligations (as
defined in the Note Purchase Agreement), subject to the limitations contained
herein, if Wachovia executes and delivers to the Collateral Agent a [Wachovia]
Addendum (as defined herein);
2
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. Terms defined in the Note Purchase Agreement and
not otherwise defined herein have, as used herein, the respective meanings
provided for therein. The following additional terms, as used herein, have the
following respective meanings:
"ACCOUNTS" means all "ACCOUNTS" (as defined in the UCC) now owned or
hereafter acquired by any Grantor, and shall also mean and include all accounts
receivable, contract rights, book debts, notes, drafts and other obligations or
indebtedness owing to any Grantor arising from the sale, lease or exchange of
goods or other property by it and/or the performance of services by it
(including, without limitation, any such obligation which might be characterized
as an account or contract right under the Uniform Commercial Code in effect in
any jurisdiction) and all rights of any Grantor in, to and under all purchase
orders for goods, services or other property, and all rights of any Grantor to
any goods, services or other property represented by any of the foregoing
(including returned or repossessed goods and unpaid sellers' rights of
rescission, replevin, reclamation and rights to stoppage in transit) and all
monies due to or to become due to any Grantor under all contracts for the sale,
lease or exchange of goods or other property and/or the performance of services
by it (whether or not yet earned by performance on the part of the Grantor), in
each case whether now in existence or hereafter arising or acquired including,
without limitation, the right to receive the proceeds of said purchase orders
and contracts and all collateral security and guarantees of any kind given by
any Person with respect to any of the foregoing.
"COLLATERAL" has the meaning set forth in Section 3.
"COPYRIGHT LICENSE" means any agreement now or hereafter in existence
granting to any Grantor, or pursuant to which any Grantor has granted to any
other Person, any right to use, copy, reproduce, distribute, prepare derivative
works based upon, display or publish any records or other materials on which a
Copyright is in existence or may come into existence.
"COPYRIGHTS" means all of the following: (i) all copyrights under the
laws of the United States or any other country (whether or not the underlying
works of authorship have been published), all registrations and recordings
thereof, all intellectual property rights to works of authorship (whether or not
published), and all applications for copyrights under the laws of the United
States or any other country, including, without limitation, registrations,
recordings and applications in the United States Copyright Office or in any
similar office or agency of the United States, or of any State thereof that
maintains any similar office or agency or of any other country or any political
subdivision
2
3
thereof, including, without limitation, those listed on Schedule 5 to the
Perfection Certificate for the Company or on Schedule 1 to any Copyright
Security Agreement, (ii) all reissues, renewals and extensions thereof, (iii)
all claims for, and rights to xxx for, past or future infringements of any of
the foregoing, and (iv) all income, royalties, damages and payments now or
hereafter due or payable with respect to any of the foregoing, including,
without limitation, damages and payments for past or future infringements
thereof.
"COPYRIGHT SECURITY AGREEMENT" means a Copyright Security Agreement
executed and delivered by a Grantor in favor of the Collateral Agent, for the
benefit of the Secured Parties substantially in the form of Exhibit D hereto, as
the same may be amended from time to time.
"DOCUMENTS" means all "DOCUMENTS" (as defined in the UCC) or other
receipts covering, evidencing or representing goods, now owned or hereafter
acquired by any Grantor.
"EQUIPMENT" means all "EQUIPMENT" (as defined in the UCC) now owned or
hereafter acquired by any Grantor wherever located, including without limitation
all machinery, apparatus, equipment, fittings, furniture, fixtures, motor
vehicles and other tangible personal Property (other than Inventory).
"GENERAL INTANGIBLES" means all "general intangibles" (as defined in the
UCC) now owned or hereafter acquired by any Grantor, including, without
limitation, (i) all obligations or indebtedness owing to any Grantor (other than
Accounts) from whatever source arising, (ii) all Patents, Patent Licenses,
Trademarks, Trademark Licenses, rights in intellectual property, goodwill, trade
names, service marks, trade secrets, Copyrights, Copyright Licenses, permits and
licenses, (iii) all rights or claims in respect of refunds for taxes paid and
(iv) all rights in respect of any pension plan or similar arrangement maintained
for employees or any member of the ERISA Group.
"INSTRUMENTS" means all "INSTRUMENTS", "CHATTEL PAPER" or "LETTERS OF
CREDIT" (each as defined in the UCC), including those evidencing, representing,
arising from or existing in respect of, relating to, securing or otherwise
supporting the payment of, any of the Accounts, including (but not limited to)
promissory notes, drafts, bills of exchange and trade acceptances, now owned or
hereafter acquired by any Grantor.
"INVENTORY" means all "INVENTORY" (as defined in the UCC), now owned or
hereafter acquired by any Grantor, wherever located, and shall also mean and
include, without limitation, all raw materials and other materials and supplies,
work-in-process and finished goods and any products made or processed therefrom
and all substances, if any, commingled therewith or added thereto.
3
4
"PATENT LICENSE" means any agreement now or hereafter in existence
granting to any Grantor, or pursuant to which any Grantor has granted to any
other Person, any right with respect to any Patent or any invention now or
hereafter in existence, whether patentable or not, whether a patent or
application for patent is in existence on such invention or not, and whether a
patent or application for patent on such invention may come into existence.
"PATENTS" means all of the following: (i) all letters patent and design
letters patent of the United States or any other country and all applications
for letters patent and design letters patent of the United States or any other
country, including, without limitation, applications in the United States Patent
and Trademark Office or in any similar office or agency of the United States, of
any State thereof that maintains any similar office or agency or of any other
country or any political subdivision thereof, including, without limitation,
those listed on Schedule 5 to the Perfection Certificate for the Company or on
Schedule 1 to any Patent Security Agreement, (ii) all reissues, divisions,
continuations, continuations-in-part, renewals and extensions thereof, (iii) all
claims for, and rights to xxx for, past or future infringements of any of the
foregoing and (iv) all income, royalties, damages and payments now or hereafter
due or payable with respect to any of the foregoing, including, without
limitation, damages and payments for past or future infringements thereof.
"PATENT SECURITY AGREEMENT" means a Patent Security Agreement executed
and delivered by a Grantor in favor of the Collateral Agent, for the benefit of
the Secured Parties, substantially in the form of Exhibit B hereto, as the same
may be amended from time to time.
"PERFECTION CERTIFICATE" means a certificate substantially in the form of
Exhibit A, completed and supplemented with the schedules and attachments
contemplated thereby to the satisfaction of the Collateral Agent, and duly
executed by an executive or senior vice president and the chief legal officer of
the applicable Grantor.
"PLEDGED ACCOUNT" has the meaning set forth in Section 5(a).
"PLEDGED DEPOSIT AGREEMENT" means a Pledged Deposit Agreement among a
bank with one or more Pledged Accounts, a Grantor as the depositor for such
Pledged Accounts and the Collateral Agent, substantially in the form of Exhibit
E.
"PROCEEDS" means all proceeds of, and all other profits, products, rents
or receipts, in whatever form, arising from the collection, sale, lease,
exchange, assignment, licensing or other disposition of, or other realization
upon, collateral, including without limitation all claims of any Grantor against
third parties for loss of, damage to or destruction of, or for proceeds payable
under, or unearned premiums with respect to, policies of insurance in
4
5
respect of, any collateral, and any condemnation or requisition payments with
respect to any collateral, in each case whether now existing or hereafter
arising.
"SECURED OBLIGATIONS" means the obligations secured under this Agreement
which include (a) all obligations in respect of principal of and interest
(including, without limitation, any interest which accrues after the
commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Company or any Subsidiary Guarantor) on any
Note issued pursuant to the Note Purchase Agreement, (b) all other amounts
payable under the Note Purchase Agreement or any other Financing Documents, (c)
only if [Wachovia] shall become a party hereto pursuant to Section 21, all Cash
Management Services Obligations, limited, however, as to this clause (c) to a
maximum aggregate amount of $3,000,000 and excluding from this clause (c) any
amounts arising from any failure of [Wachovia] and/or any of its affiliates to
comply in any material respect with the Guide to the Federal Reserve's Payments
System Risk Policy as in effect from time to time and (d) any amendments,
restatements, renewals, extensions or modifications of any of the foregoing.
"SECURED PARTIES" means (i) Purchaser, all other Holders and the
Collateral Agent and (ii) only if it shall become a party hereto pursuant to
Section 21, [Wachovia].
"SECURITY INTERESTS" means the security interests in the Collateral
granted hereunder securing the Secured Obligations.
"SUNTRUST CASH COLLATERAL ACCOUNT" means that account established or to
be established with [SunTrust Bank, Atlanta], for the purpose of cash
collateralizing a certain letter of credit in the amount of $2,500,000 securing
a workers' compensation policy.
"TRADEMARK LICENSE" means any agreement now or hereafter in existence
granting to any Grantor, or pursuant to which any Grantor has granted to any
other Person, any right to use any Trademark.
"TRADEMARKS" means all of the following: (i) all trademarks, trade names,
corporate names, company names, business names, fictitious business names, trade
styles, service marks, logos, brand names, trade dress, package and other
designs, and any other source or business identifiers, and general intangibles
of like nature, and the rights in any of the foregoing which arise under
applicable law, including, without limitation, those listed on Schedule 5 to the
Perfection Certificate for the Company or on Schedule 1 to any Trademark
Security Agreement, (ii) the goodwill of the business symbolized thereby or
associated with each of them, (iii) all trademark registrations and applications
in the United States Patent and Trademark Office or in any similar office or
agency of the United States, any State thereof or any other country or any
political subdivision thereof, (iv) all extensions and renewals thereof, (v) all
claims for, and rights to xxx for, past, present or future infringements of any
of the foregoing and (vi) all income, royalties, damages and
5
6
payments now or hereafter due or payable with respect to any of the foregoing,
including, without limitation, damages and payments for past or future
infringements thereof.
"TRADEMARK SECURITY AGREEMENT" means a Trademark Security Agreement
executed and delivered by a Grantor in favor of the Collateral Agent, for the
benefit of the Secured Parties substantially in the form of Exhibit C hereto, as
the same may be amended from time to time.
"UCC" means the Uniform Commercial Code as in effect on the date hereof
in the State of New York; provided that if by reason of mandatory provisions of
law, the perfection or the effect of perfection or non-perfection of the
Security Interest 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 or effect of perfection or
non-perfection.
["WACHOVIA"] means [Wachovia Bank, N.A.] and its successors.
["WACHOVIA] ADDENDUM" means an addendum to this Agreement duly executed
by [Wachovia] and the Collateral Agent, substantially in the form of Exhibit F
hereto.
SECTION 2. REPRESENTATIONS AND WARRANTIES. The Grantors, jointly and
severally, represent and warrant as follows:
(a) Each Grantor owns each item of its Collateral, free and clear
of any Liens other than the Permitted Liens.
(b) To the best of each Grantor's knowledge, no Grantor has
performed any acts which might prevent the Collateral Agent from
enforcing any of the terms of this Agreement or which would limit the
Collateral Agent in any such enforcement. Other than financing statements
or other similar or equivalent documents or instruments with respect to
the Security Interests and Permitted Liens, no financing statement,
mortgage, security agreement or similar or equivalent document or
instrument covering all or any part of the Collateral is on file or of
record in any jurisdiction in which such filing or recording would be
effective to perfect a Lien on such Collateral. No Collateral is in the
possession of any Person (other than a Grantor) asserting any claim
thereto or security interest therein, except that the Collateral Agent or
its designee may have possession of Collateral as contemplated hereby.
(c) The information set forth in the Perfection Certificate of
each Grantor delivered to the Collateral Agent prior to the date of the
Initial Takedown is correct and complete in all material respects and, as
amended prior to January 15,
6
7
1998, is correct and complete in all respects. Not later than 30 days
following the date of the Initial Takedown, the Company shall furnish to
the Collateral Agent file search reports from each UCC filing office set
forth in Schedule ? to the Perfection Certificate of each Grantor
confirming the filing information set forth in such Schedule.
(d) The Security Interests constitute valid security interests
under the UCC securing the Secured Obligations. Upon completion of the
actions and filings described in Schedule 3.02 to the Note Purchase
Agreement, the Security Interests shall constitute perfected security
interests in the Collateral (except Inventory in transit) to the extent
that a security interest therein may be perfected by filing pursuant to
the UCC, prior to all other Liens and rights of others therein except for
the Permitted Liens. To the extent that the Federal laws of the United
States apply to the perfection of security interests in Patents and
Trademarks, when a Patent Security Agreement or a Trademark Security
Agreement has been recorded with the United States Patent and Trademark
Office on a date within three months after the date of such Patent
Security Agreement or Trademark Security Agreement, as the case may be,
the Security Interests shall constitute perfected Security Interests in
all right, title and interest of the applicable Grantor in the Patents
listed on Schedule 1 to such Patent Security Agreement or Trademarks
listed on Schedule 1 to such Trademark Security Agreement, as the case
may be, prior to all other Liens and rights of others therein except for
Permitted Liens. To the extent that the Federal laws of the United States
apply to the perfection of security interests in Copyrights, when a
Copyright Security Agreement has been filed with the United States
Copyright Office on a date within one month after the date of such
Copyright Security Agreement, the Security Interests shall constitute
perfected security interests in all right, title and interest of the
applicable Grantor in the Copyrights listed on Schedule 1 to such
Copyright Security Agreement, prior to all other Liens and rights of
others therein except for Permitted Liens.
(e) The Inventory and Equipment are insured in accordance with the
requirements of the Note Purchase Agreement.
SECTION 3. THE SECURITY INTERESTS. (a) In order to secure the full and
punctual payment of the Secured Obligations in accordance with the terms
thereof, and to secure the performance of all of the obligations of any Grantor
hereunder and under the Note Purchase Agreement, each Grantor hereby grants to
the Collateral Agent, for the benefit of the Secured Parties, a continuing
security interest in and to all of such Grantor's right, title and interest in
and to the following property of such Grantor, whether now owned or existing or
hereafter acquired or arising and regardless of where located (all being
collectively referred to as the "COLLATERAL"):
(i) Accounts;
7
8
(ii) Inventory;
(iii) General Intangibles;
(iv) Documents;
(v) Instruments;
(vi) Equipment;
(vii) The Pledged Accounts, all cash deposited therein from time
to time, the investments made pursuant to Section 5(d) and other monies
and property of any kind of such Grantor in the possession or under the
control of the Collateral Agent;
(viii) All books and records (including, without limitation,
customer lists, credit files, computer programs, printouts and other
computer materials and records) of such Grantor pertaining to any of the
Collateral;
(ix) All proceeds, revenues, rights and benefits described in
clause (iii) of any Copyright Security Agreement, Patent Security
Agreement or Trademark Security Agreement; and
(x) All Proceeds of all or any of the Collateral described in
Clauses 3(a)(i) through 3(a)(ix) hereof;
provided that Collateral shall not include any such property to the extent, and
solely to the extent, that (i) the grant of a security interest therein is
prohibited by law or (ii) such property is a contract right and the grant of a
security interest therein is expressly and validly prohibited by such contract.
(b) The Security Interests are granted as security only and shall not
subject the Collateral Agent or any other Secured Party to, or transfer or in
any way affect or modify, any obligation or liability of any Grantor with
respect to any of the Collateral or any transaction in connection therewith.
SECTION 4. FURTHER ASSURANCES; COVENANTS. (a) No Grantor will change its
name, identity or corporate structure in any manner unless it shall have given
the Collateral Agent not less than 10 Business Days' prior notice thereof. No
Grantor will change (i) the location of its chief executive office or principal
place of business or (ii) the locations where it keeps or holds any Collateral
or any records relating thereto from the applicable location described in the
Perfection Certificate unless it shall have given the
8
9
Collateral Agent not less than 30 days' prior notice thereof. No Grantor shall
in any event change the location of any Collateral if such change would cause
the Security Interests in such Collateral to lapse or cease to be perfected
notwithstanding the filing of a financing statement or similar document.
(b) Each Grantor will, from time to time, at its expense, execute,
deliver, file and record any statement, 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 necessary or desirable, or that the Collateral
Agent may request, in order to create, preserve, perfect, confirm or validate
the Security Interests or to enable the Secured Parties to obtain the full
benefits of this Agreement, or to enable the Collateral Agent to exercise and
enforce any of its rights, powers and remedies hereunder with respect to any of
the Collateral. To the extent permitted by applicable law, each Grantor hereby
authorizes the Collateral Agent, and appoints the Collateral Agent as its true
and lawful attorney (with full power of substitution, in the name of such
Grantor or otherwise, for the sole use and benefit of the Secured Parties) to
execute and file financing statements or continuation statements without such
Grantor's signature appearing thereon. Each Grantor agrees that a carbon,
photographic, photostatic or other reproduction of this Agreement or of a
financing statement is sufficient as a financing statement. The Company shall
pay the costs of, or incidental to, any recording or filing of any financing or
continuation statements concerning the Collateral.
(c) If any Collateral is at any time in the possession or control of
any warehouseman, bailee or any of the agents or processors of any Grantor, such
Grantor shall notify such warehouseman, bailee, agent or processor of the
Security Interests created hereby and to hold all such Collateral for the
Collateral Agent's account subject to the Collateral Agent's instructions.
(d) Each Grantor shall keep full and accurate books and records
relating to its Collateral.
(e) Each Grantor will immediately deliver and pledge each Instrument
having a principal amount in excess of $1,000,000 to the Collateral Agent,
appropriately endorsed to the Collateral Agent, provided that so long as no
Event of Default shall have occurred and be continuing, such Grantor may retain
for collection in the ordinary course any Instruments received by it in the
ordinary course of business and the Collateral Agent shall, promptly upon
request of such Grantor, make appropriate arrangements for making any other
Instrument pledged by such Grantor 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 trust receipt or like document).
9
10
(f) Each Grantor shall use its commercially reasonable best efforts to
cause to be collected from its account debtors, as and when due, any and all
amounts owing under or on account of each of its Account (including, without
limitation, Accounts which are delinquent, such Accounts to be collected in
accordance with lawful collection procedures) and shall apply forthwith upon
receipt thereof all such amounts as are so collected to the outstanding balance
of such Account. Subject to the rights of the Collateral Agent and the other
Secured Parties hereunder upon the occurrence and during the continuance of an
Event of Default, a Grantor may allow in the ordinary course of business as
adjustments to amounts owing under its Accounts (i) an extension or renewal of
the time or times of payment, or settlement for less than the total unpaid
balance, which such Grantor finds appropriate in accordance with sound business
judgment and (ii) a refund or credit due as a result of returned or damaged
merchandise, all in accordance with such Grantor's ordinary course of business
consistent with its historical collection practices. The costs and expenses
(including, without limitation, attorney's fees) of collection, whether incurred
by a Grantor or any Secured Party, shall be borne by the Company.
(g) Upon the occurrence and during the continuance of any Event of
Default, upon request of the Collateral Agent, each Grantor will promptly notify
(and each Grantor hereby authorizes the Collateral Agent so to notify) each of
its account debtors in respect of any Account or Instrument that such Collateral
has been assigned to the Collateral Agent hereunder, and that any payments due
or to become due in respect of such Collateral are to be made directly to the
Collateral Agent or its designee.
(h) Except as permitted under the Note Purchase Agreement, without the
prior written consent of the Collateral Agent, no Grantor will sell, lease,
exchange, assign or otherwise dispose of, or grant any option with respect to,
any Collateral.
(i) Promptly upon the request of the Collateral Agent, each Grantor
will cause the Collateral Agent to be named as an insured party and loss payee
on each insurance policy covering risks relating to any of its Inventory and
Equipment. Each Grantor will deliver to the Collateral Agent, upon request of
the Collateral Agent, the insurance policies for such insurance or certificates
of insurance evidencing such coverage. Each such insurance policy shall include
effective waivers by the insurer of all claims for insurance premiums against
the Collateral Agent, and provide that no cancellation, termination or material
modification thereof shall be effective until at least 30 days after receipt by
the Collateral Agent of notice thereof.
(j) Promptly upon the request of the Collateral Agent, each Grantor
will provide to any Secured Party all information and evidence it may reasonably
request concerning the Collateral to enable the Collateral Agent or any other
Secured Party to enforce the provisions of this Agreement.
10
11
(k) Each Grantor shall notify the Collateral Agent promptly if it
knows, or has reason to know, that any application or registration relating to
any Copyright, Patent or Trademark that is material to the business and
operations of the Grantors, taken as a whole, may become abandoned. In the event
that any Grantor receives notice of or becomes aware that any right to a
Copyright, Copyright License, Patent, Patent License, Trademark or Trademark
License that is material to the business and operations of the Grantors, taken
as a whole, has been breached, infringed, misappropriated or diluted in any
material respect by a third party, such Grantor shall notify the Collateral
Agent promptly after it learns thereof and shall, unless such Grantor shall
reasonably determine that any such action would be economically disadvantageous,
promptly xxx for breach, infringement, misappropriation or dilution and to
recover any and all damages for such breach, infringement, misappropriation or
dilution, and take such other actions as such Grantor shall reasonably deem
appropriate under the circumstances to protect such Copyright, Copyright
License, Patent, Patent License, Trademark or Trademark License. In no event
shall any Grantor, either itself or through any agent, employee or licensee,
file an application for the registration of any material Copyright with the
United States Copyright Office or any material Patent or Trademark with the
United States Patent and Trademark Office, or with any similar office or agency
in any other country or any political subdivision thereof, as soon as reasonably
practicable but in no event later than 90 days after such filing it informs the
Collateral Agent, and, upon request of the Collateral Agent, executes and
delivers any and all agreements, instruments, documents and papers the
Collateral Agent may request to evidence the Security Interests in such
Copyright, Patent or Trademark and the goodwill and general intangibles of such
Grantor relating thereto or represented thereby. Each Grantor hereby constitutes
the Collateral Agent its attorney-in-fact to execute and file all such writings
for the foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; such power, being coupled with an interest, shall be irrevocable
until the Secured Obligations are paid in full.
(l) Each Grantor agrees that if any Subsidiary of the Company owes any
Debt to such Grantor that is not pledged to the Collateral Agent under the
Pledge Agreement, such Debt shall not be evidenced by a note or other instrument
and shall constitute Collateral hereunder.
(m) Each Grantor agrees that if will not enter into any contract that
prohibits the granting of a security interest therein, except in the ordinary
course of business, consistent with past practices.
SECTION 5. PLEDGED ACCOUNTS. (a) By February 28, 1998, each Grantor shall
cause the Collateral Agent to receive a duly executed Pledged Deposit Agreement
from each of its banks covering all of its bank accounts (other than payroll,
trust or similar accounts or the SunTrust Cash Collateral Account) on such date.
If any Grantor hereafter establishes any bank accounts (other than payroll,
trust or similar accounts or the SunTrust Cash Collateral Account), the Grantor
shall enter into a Pledged Deposit
11
12
Agreement with such bank (all bank accounts now existing or hereafter acquired
(other than payroll, trust or similar accounts or the SunTrust Cash Collateral
Account), collectively, the "PLEDGED ACCOUNTS"). At all times after February 28,
1998, all cash Proceeds of such Grantor's Collateral shall be deposited into
such Grantor's Pledged Accounts. No Grantor shall amend or terminate any of its
Pledged Deposit Agreements without the prior written approval of the Collateral
Agent. Any income received with respect to the balance from time to time
standing to the credit of any Pledged Account, including any interest or capital
gains on any investments thereof, shall remain, or be deposited, in such Pledged
Account. All right, title and interest in and to the cash amounts on deposit
from time to time in each Pledged Account, together with any investments thereof
from time to time, shall constitute part of the Collateral hereunder and shall
not constitute payment of the Secured Obligations until applied thereto as
hereinafter provided.
(b) Upon the occurrence and during the continuation of an Event of
Default, each Grantor shall, upon the request of the Collateral Agent, instruct
all account debtors and other Persons obligated in respect of any of its
Accounts to make all payments in respect of such Accounts and shall use its best
efforts to cause such account debtors and other Persons to remit all such
payments, to the extent permitted by applicable law, directly to its Pledged
Account (if paid by wire transfer), or to a post office box that is subject to a
lockbox agreement for deposit into such Pledged Account. In addition to the
foregoing, each Grantor agrees that if the proceeds of any Collateral hereunder
(including any payments made in respect of Accounts) shall be received by it,
such Grantor shall as promptly as possible deposit such proceeds into one or
more of its Pledged Accounts. Until so deposited, all such proceeds shall be
held in trust by such Grantor for and as the property of the Secured Parties and
shall not be commingled with any other funds or property of such Grantor.
(c) The balance from time to time standing to the credit of each
Pledged Account shall, except upon the occurrence and during the continuation of
an Event of Default, be distributed to the applicable Grantor in accordance with
the provisions of its Pledged Deposit Agreement. Upon the occurrence and during
the continuation of an Event of Default, the Collateral Agent shall, in its
discretion, apply or cause to be applied (subject to collection) any or all of
the balance from time to time standing to the credit of each Pledged Account in
the manner specified in Section 9.
(d) Amounts on deposit in each Pledged Account may be invested and
reinvested from time to time in accordance with Section 6.12 of the Note
Purchase Agreement; provided that if an Event of Default shall have occurred and
be continuing, upon the request of the Collateral Agent in its discretion, each
Grantor shall invest amounts on deposit in its Pledged Accounts only in
investments for which all steps necessary or appropriate, in the reasonable
judgment of the Collateral Agent, shall have
12
13
been taken to provide the Agent, for the benefit of the Secured Parties, a
perfected security interest therein.
SECTION 6. GENERAL AUTHORITY. Each Grantor hereby irrevocably appoints
the Collateral Agent its true and lawful attorney, with full power of
substitution, in the name of any Grantor, the Collateral Agent or otherwise, for
the sole use and benefit of the Collateral Agent and the other Secured Parties,
but at the Company's expense, to the extent permitted by law to exercise, at any
time and from time to time, in each case 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:
(a) to demand, xxx for, collect, receive and give acquittance for
any and all monies due or to become due thereon or by virtue thereof,
(b) to settle, compromise, compound, prosecute or defend any
action or proceeding with respect thereto,
(c) to sell, transfer, assign or otherwise deal in or with the
same or the proceeds or avails thereof, including without limitation for
the implementation of any lease, assignment, license, sublicense, grant
of option, sale or other disposition of any Copyright, Patent or
Trademark or any action related thereto, as fully and effectually as if
the Collateral Agent were the absolute owner thereof, and
(d) to extend the time of payment of any or all thereof and to
make any allowance and other adjustments with reference thereto;
provided that the Collateral Agent shall give each Grantor not less than ten
days' prior notice of the time and place of any sale or other intended
disposition of any of the Collateral, except any Collateral which is perishable
or threatens to decline speedily in value or is of a type customarily sold on a
recognized market. The Collateral Agent and each Grantor agree that such notice
constitutes "reasonable notification" within the meaning of Section 9-504(3) of
the UCC.
SECTION 7. REMEDIES UPON EVENT OF DEFAULT. (a) If any Event of Default
has occurred and is continuing, the Collateral Agent may exercise on behalf of
the Secured Parties all rights of a secured party under the UCC (whether or not
in effect in the jurisdiction where such rights are exercised) and, in addition,
the Collateral Agent may, without being required to give any notice, except as
herein provided or as may be required by mandatory provisions of law, (i)
withdraw all cash in the Pledged Accounts and liquidate any investments thereof
and apply such cash and the proceeds of such liquidation and any other cash held
by it as Collateral in accordance with Section 9 and (ii) if there shall be no
such cash or investments or if such cash and investments shall be insufficient
to pay all the Secured Obligations in full, sell the Collateral or any part
thereof at public or
13
14
private sale, for cash, upon credit or for future delivery, and at such price or
prices as the Collateral Agent may deem satisfactory. The Collateral Agent 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 Grantor will execute and deliver such documents and take
such other action as the Collateral Agent 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 from any claim or right of
whatsoever kind, including any equity or right of redemption of any Grantor
which may be waived, and each Grantor, to the extent permitted by law, hereby
specifically waives all rights of redemption, stay or appraisal which it has or
may have under any law now existing or hereafter adopted. The notice (if any) of
such sale required by Section 6 shall (A) in the case of a public sale, state
the time and place fixed for such sale, and (B) in the case of a private sale,
state the day after which such sale may be consummated. Any such public sale
shall be held at such time or times within ordinary business 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
separate 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. 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 the case of the failure of such purchaser to take up and pay for the
Collateral so sold and, in the case of any such failure, such Collateral may
again be sold upon like notice. The Collateral Agent, instead of exercising the
power of sale herein conferred upon it, 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.
(b) For the purpose of enforcing any and all rights and remedies under
this Agreement the Collateral Agent may (i) require any Grantor to, and each
agrees that it will, at its expense and upon the request of the Collateral
Agent, forthwith assemble all or any part of the Collateral as directed by the
Collateral Agent and make it available at a place designated by the Collateral
Agent which is, in its opinion, reasonably convenient to the Collateral Agent
and such Grantor, whether at the premises of such Grantor or otherwise, (ii) to
the extent permitted by applicable law, enter, with or without process of law
and without breach of the peace, any premise where any of the Collateral is or
may be located, and without charge or liability to it seize and remove such
Collateral from such premises, (iii) have access to and use the Grantor's books
and records relating to the
14
15
Collateral and (iv) prior to the disposition of the Collateral, store or
transfer it without charge in or by means of any storage or transportation
facility owned or leased by any Grantor, process, repair or recondition it or
otherwise prepare it for disposition in any manner and to the extent the
Collateral Agent deems appropriate and, in connection with such preparation and
disposition, use without charge any trademark, trade name, copyright, patent or
technical process used by any Grantor. The Collateral Agent may also render any
or all of the Collateral unusable at any Grantor's premises and may dispose of
such Collateral on such premises without liability for rent or costs.
(c) Without limiting the generality of the foregoing, if any Event of
Default has occurred and is continuing,
(i) The Collateral Agent may license or sublicense, on an
exclusive or non-exclusive basis, any Copyrights, Patents or Trademarks
included in the Collateral throughout the world for such term or terms,
on such conditions and in such manner as the Collateral Agent shall in
its sole discretion determine; provided that such terms and conditions do
not result in a breach or default under any Copyright License, Patent
License or Trademark License to which Grantor is a Party;
(ii) The Collateral Agent may (without assuming any obligations
or liability thereunder), at any time and from time to time, enforce (and
shall have the exclusive right to enforce) against any licensor, licensee
or sublicensee all rights and remedies of any Grantor in, to and under
any Copyright Licenses, Patent Licenses or Trademark Licenses and take or
refrain from taking any action under any thereof, and such Grantor hereby
releases the Collateral Agent from, and agrees to hold the Collateral
Agent free and harmless from and against any claims arising out of, any
lawful action so taken or omitted to be taken with respect thereto,
except any such claim to the extent that it arises as the result of the
gross negligence or willful misconduct of the Collateral Agent; and
(iii) upon request by the Collateral Agent, each Grantor will
execute and deliver to the Collateral Agent a further power of attorney,
in form and substance satisfactory to the Collateral Agent, for the
implementation of any lease, assignment, license, sublicense, grant of
option, sale or other disposition of a Copyright, Patent, Trademark,
Copyright License, Patent License or Trademark License. In the event of
any such disposition pursuant to this Section, each Grantor shall supply
to the Collateral Agent its know-how and expertise relating to the
manufacture and sale of the products bearing Trademarks or the products
or services made or rendered in connection with the Patents, and copies
of its customer lists and other records relating to such Patents or
Trademarks and to the distribution of said products.
15
16
SECTION 8. LIMITATION ON DUTY OF COLLATERAL AGENT IN RESPECT OF
COLLATERAL. Beyond the exercise of reasonable care in the custody thereof, the
Collateral Agent shall have no duty as to any Collateral in its 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. The Collateral Agent shall be deemed to have
exercised reasonable care in the custody of the Collateral in its possession if
the Collateral is accorded treatment substantially equal to that which it
accords its own property, and 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 warehouseman, carrier, forwarding agency,
consignee or other agent or bailee selected by the Collateral Agent in good
faith.
SECTION 9. APPLICATION OF PROCEEDS. Upon the occurrence and during the
continuance of an Event of Default, the proceeds of any sale of, or other
realization upon, all or any part of any Grantor's Collateral any cash in the
Pledged Accounts shall be applied by the Collateral Agent in the following order
of priorities:
FIRST, to payment of the expenses of such sale or other
realization, including reasonable compensation to agents and counsel for
the Collateral Agent, and all expenses, liabilities and advances incurred
or made by the Collateral Agent in connection therewith, and any other
unreimbursed expenses for which the Collateral Agent is to be reimbursed
pursuant to Section 10.04 of the Note Purchase Agreement or Section 12
hereof and unpaid fees owing to the Collateral Agent under the Note
Purchase Agreement;
SECOND, to the ratable payment of all other Secured Obligations,
until all Secured Obligations shall have been paid in full; and
FINALLY, to payment to such Grantor or its successors or assigns,
or as a court of competent jurisdiction may direct, of any surplus then
remaining from such proceeds.
The Collateral Agent may make distributions hereunder in cash or in kind or, on
a ratable basis, in any combination thereof.
SECTION 10. CONCERNING THE COLLATERAL AGENT. (a) Each Secured Party
irrevocably appoints and authorizes the Collateral Agent to enter into the
Security Documents on its behalf, including any Security Documents that the
Collateral Agent may hereafter enter into from time to time at the request of
any Secured Party, and to take all such action as is provided to be taken by it
as Collateral Agent hereunder and thereunder and all other action reasonably
incidental thereto. As to any matters not expressly provided for herein or
therein (including the timing and methods of
16
17
realization upon the Collateral) the Collateral Agent shall act or refrain from
acting in accordance with written instructions from the Secured Parties or, in
the absence of such instructions, in accordance with its discretion. Without
limiting the effect of the foregoing, each Secured Party agrees that (i) the
Collateral Agent may exercise or refrain from exercising any right, remedy or
power granted by or in connection with any Security Document without notice to
or assent by any Secured Party and (ii) no Secured Party shall have any right of
action whatsoever against the Collateral Agent in connection with the Collateral
Agent's acting or refraining from acting hereunder or under any other Security
Documents in accordance with written instructions of the Secured Parties.
(b) Purchaser shall have the same rights and powers under the Security
Documents as any other Secured Party and may exercise or refrain from exercising
the same as though it were not the Collateral Agent.
(c) The Collateral Agent may consult with legal counsel, independent
public accountants and other experts selected by it and shall not be liable for
any action taken or omitted to be taken by it in good faith in accordance with
the advice of such counsel, accountants or experts.
(d) Neither the Collateral Agent nor any of its directors, officers,
agents, or employees shall be liable for any action taken or not taken by it in
connection with the Security Documents in the absence of its own gross
negligence or willful misconduct. Neither the Collateral Agent nor any of its
directors, officers, agents or employees shall be responsible for or have any
duty to ascertain, inquire into or verify (i) the existence, genuineness or
value of any of the Collateral or 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 or under any other Security Document; (ii) any statement,
warranty or representation made in connection with the Note Purchase Agreement
or any Security Document; (iii) the performance or observance of any of the
covenants or agreements of any Grantor hereunder; or (iv) the validity,
effectiveness, sufficiency or genuineness of any Security Document or any other
instrument or writing furnished in connection therewith. The Collateral Agent
shall not incur any liability by acting in reliance upon any notice, consent,
certificate, statement, or other writing (which may be a bank wire, telex,
facsimile transmission or similar writing) believed by it to be genuine or to be
signed by the proper party or parties.
(e) Each Secured Party shall, ratably in accordance with the aggregate
amount of Secured Obligations it holds, indemnify the Collateral Agent (to the
extent not reimbursed by the Company) against any cost, expense (including
counsel fees and disbursements), claim, demand, action, loss or liability
(except such as result from the Collateral Agent's gross negligence or willful
misconduct) that the Collateral Agent
17
18
may suffer or incur in connection with any Security Documents or any action
taken or omitted by the Collateral Agent hereunder or thereunder.
SECTION 11. APPOINTMENT OF CO-AGENTS. At any time or times, in order to
comply with any legal requirement in any jurisdiction, the Collateral Agent may
appoint a 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 Collateral Agent 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 9).
SECTION 12. EXPENSES. In the event that any Grantor fails to comply with
the provisions of the Note Purchase Agreement or this Agreement, such that the
value of any Collateral or the validity, perfection, rank or value of any
Security Interest is thereby diminished in any material respect or put at risk,
the Collateral Agent may, but shall not be required to, effect such compliance
on behalf of such Grantor, and the Company shall reimburse the Collateral Agent
for the costs thereof on demand. All insurance expenses and all expenses of
protecting, storing, warehousing, appraising, insuring, handling, maintaining,
and shipping the Collateral, 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 and inspections of the Collateral, or in
respect of the sale or other disposition thereof shall be borne and paid by the
Company; and if any Grantor fails to promptly pay any portion thereof when due,
the Collateral Agent or any other Secured Party may, at its option, but shall
not be required to, pay the same and charge the Company's account therefor, and
the Company agrees to reimburse the Collateral Agent therefor on demand. All
sums so paid or incurred by the Collateral Agent or any other Secured Party for
any of the foregoing and any and all other sums for which any Grantor may become
liable hereunder and all costs and expenses (including attorneys' fees, legal
expenses and court costs and a reasonable allocation of the compensation, costs
and expenses of in-house counsel, based upon time spent) reasonably incurred by
the Collateral Agent or any other Secured Party in enforcing or protecting the
Security Interests or any of their rights or remedies under this Agreement,
shall, together with interest thereon until paid at an annual rate equal to 3%
plus the rate announced from time to time by The Bank of New York as its prime
rate, be Secured Obligations hereunder.
SECTION 13. TERMINATION OF SECURITY INTERESTS; RELEASE OF COLLATERAL.
Upon the repayment in full of all Secured Obligations and the termination of the
Commitment under the Note Purchase Agreement, the Security Interests shall
terminate and all rights of each Grantor to the Collateral shall revert to such
Grantor. 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 only
with the prior written consent of the Majority Holders; provided
18
19
that if any Grantor ceases to be a Subsidiary of the Company as may be permitted
by the Note Purchase Agreement at such time and if at such time and after giving
effect to such event no Default shall have occurred and be continuing, the
Security Interests granted by such Grantor shall terminate; and provided further
that if any Grantor sells or otherwise disposes of any Collateral as permitted
by Section 6.15(b) of the Note Purchase Agreement at such time and if at such
time and after giving effect to such event no Default shall have occurred and be
continuing, the Security Interests in such Collateral granted by such Grantor
shall terminate. Upon any such termination of the Security Interests or release
of Collateral, the Collateral Agent will, at the expense of the Company,
execute, deliver and return to the Grantors such documents and instruments as
the Grantors shall reasonably request to evidence the termination of the
Security Interests or the release of such Collateral, as the case may be.
SECTION 14. NOTICES. All notices, communications and distributions
hereunder shall be given in accordance with Section 10.01 of the Note Purchase
Agreement. In the case of Wachovia, its address shall be as set forth on the
Wachovia Addendum, or such other address as Wachovia may hereafter specify to
the Company and the Collateral Agent for such purpose.
SECTION 15. WAIVERS, NON-EXCLUSIVE REMEDIES. No failure on the part of
the Collateral Agent or any other Secured Party to exercise, and no delay in
exercising and no course of dealing with respect to, any right under this
Agreement shall operate as a waiver thereof; nor shall any single or partial
exercise by the Collateral Agent or any other Secured Party of any right under
the Note Purchase Agreement or any other Financing Document preclude any other
or further exercise thereof or the exercise of any other right. The rights in
this Agreement and the Note Purchase Agreement are cumulative and are not
exclusive of any other remedies provided by law.
SECTION 16. SUCCESSORS AND ASSIGNS. This Agreement is for the benefit of
the Secured Parties and their successors and assigns, and in the event of an
assignment of all or any of the Secured Obligations, the rights hereunder, to
the extent applicable to the indebtedness so assigned, may be transferred with
such indebtedness. This Agreement shall be binding on the Grantors and their
successors and assigns.
SECTION 17. CHANGES IN WRITING. Neither this Agreement nor any provision
hereof may be changed, waived, discharged or terminated orally, but only in
writing signed by each Grantor affected thereby and the Collateral Agent.
SECTION 18. NEW YORK LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of New York, except as otherwise
required by mandatory provisions of law and except to the extent that remedies
provided by the laws of any jurisdiction other than New York are governed by the
laws of such jurisdiction.
19
20
SECTION 19. SEVERABILITY. 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 Secured 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
provision in any other jurisdiction.
SECTION 20. COUNTERPARTS. This 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.
SECTION 21. [WACHOVIA] ADDENDUM. From and after the date when the
Collateral Agent shall receive a duly executed [Wachovia] Addendum, (i) the Cash
Management Obligations will become Secured Obligations hereunder, subject to the
limitations contained herein, and (ii) Wachovia shall become a Secured Party
hereunder, and shall thereupon become entitled to the benefits, and be bound by
the obligations, under this Agreement as a Secured Party, including without
limitation Section 10 hereof.
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.
MEDAPHIS CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
SUBSIDIARY GUARANTORS
ASSETCARE, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
20
21
AUTOMATION ATWORK
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
BSG ALLIANCE/IT, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
BSG CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
BSG GOVERNMENT SOLUTIONS, INC.
(FORMERLY KNOWN AS RAPID SYSTEMS
SOLUTIONS, INC.)
By: /s/ Xxxxxxxx X. X. Xxxxx
------------------------------------
Name: Xxxxxxxx X. X. Xxxxx
Title: Secretary
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
CONSORT TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
21
22
XXXXXXXX'X FINANCIAL SERVICES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
HEALTH DATA SCIENCES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
MEDAPHIS HEALTHCARE INFORMATION
TECHNOLOGY COMPANY (F/K/A MEDAPHIS
SYSTEMS CORPORATION)
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
MEDAPHIS PHYSICIAN SERVICES CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
MEDAPHIS SERVICES CORPORATION (F/K/A
MEDAPHIS HOSPITAL SERVICES CORPORATION)
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
22
23
MEDICAL MANAGEMENT SCIENCES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
NATIONAL HEALTHCARE
TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
23
24
COLLATERAL AGENT
[MED FUNDING, INC.], AS
COLLATERAL AGENT
By:
----------------------------------
Name:
Title:
24
25
EXHIBIT A TO
SECURITY AGREEMENT
PERFECTION CERTIFICATE FOR [NAME OF GRANTOR]
The undersigned, [chief legal officer] and [executive] [senior] vice
president, of [Name of Grantor], a [ ] corporation (the "COMPANY"), hereby
certify as follows to [Med Funding, Inc.] ("PURCHASER"), with reference to the
Security Agreement dated as of December ___, 1997 among the Company, the
Subsidiary Guarantors party thereto (the Company and each Subsidiary Guarantor,
a "GRANTOR") and Purchaser, as Collateral Agent (terms defined therein being
used herein as therein defined):
1. Names. (a) The exact corporate name of the Grantor, as it appears in
its certificate of incorporation is as follows:
[Name of Grantor]
(b) Set forth below is each other corporate name the Grantor has had
since its organization, together with the date of the relevant change:
(c) The Grantor has not changed its identity or corporate structure in
any way within the past five years except as described below:
(d) The following is a list of all other names (including trade names or
similar appellations) used by the Grantor or any of its divisions or other
business units at any time during the past five years:
[Name of Grantor]
25
26
2. Current Locations. (a) The chief executive office of the Grantor is
located at the following address:
Mailing Address County State
(b) The following are all the locations where the Grantor maintains any
books or records relating to any Accounts:
Mailing Address County State
(c) The following are all the places of business of the Grantor not
identified above:
Name Mailing Address County State
(d) The following are all the locations where the Grantor maintains any
Inventory not identified above:
Name Mailing Address County State
(e) The following are the names and addresses of all Persons other than
the Grantor which have possession of any of the Grantor's Inventory:
Name Mailing Address County State
3. Prior Locations. (a) Set forth below is the information required by
subparagraphs (a), (b) and (c) of paragraph 2 with respect to each location or
place of business maintained by the Grantor at any time during the past five
years:
26
27
(b) Set forth below is the information required by subparagraphs (d) and
(e) of paragraph 2 with respect to each location or bailee where or with whom
Inventory has been lodged at any time during the past four months:
4. Unusual Transactions. All Accounts have been originated by the Grantor
and all Inventory and Equipment has been acquired by the Grantor in the ordinary
course of its business.
5. Patents, Trademarks, Copyrights. All patents, trademarks and
copyrights owned by the Grantor as of the date hereof are listed on Schedule 5
to the Medaphis Corporation Perfection Certificate delivered to Purchaser
concurrently herewith.
IN WITNESS WHEREOF, we have hereunto set our hands this ____ day of
December, 1997.
---------------------------------
Title:
---------------------------------
Title:
27
28
EXHIBIT B TO
SECURITY AGREEMENT
PATENT SECURITY AGREEMENT
(PATENTS, PATENT APPLICATIONS AND PATENT LICENSES)
WHEREAS, _______________, a [Delaware] corporation (herein referred to as
"GRANTOR") owns the Patents (as defined in the Security Agreement referred to
below) listed on Schedule 1 annexed hereto, and is a party to the Patent
Licenses (as defined in the Security Agreement referred to below) identified in
Schedule 1 annexed hereto;
WHEREAS, Grantor, the Subsidiary Guarantors party thereto and [Med
Funding, Inc.] are parties to a Note Purchase Agreement of even date herewith
(as the same may be amended and in effect from time to time among said parties
as may from time to time be parties thereto, the "NOTE PURCHASE AGREEMENT");
WHEREAS, pursuant to the terms of the Security Agreement of even date
herewith (as said Agreement may be amended and in effect from time to time, the
"SECURITY AGREEMENT") among Grantor, [Med Funding, Inc.], as Collateral Agent
for the secured parties referred to therein (in such capacity, together with its
successors in such capacity, "GRANTEE") and certain other parties, Grantor has
granted to Grantee for the benefit of such secured parties a continuing security
interest in substantially all the assets of Grantor, including all right, title
and interest of Grantor in, to and under the Patent Collateral (as defined
herein) whether now owned or existing or hereafter acquired or arising, to
secure the Secured Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor hereby grants to Grantee,
for the benefit of the Secured Parties (as defined in the Security Agreement), a
continuing security interest in and to all of Grantor's right, title and
interest in and to all of the following property, whether now owned or existing
or hereafter acquired or arising and regardless of where located (all being
collectively referred to as the "PATENT COLLATERAL"):
(i) each Patent (as defined in the Security Agreement) owned by
Grantor (including each design patent and patent application), including,
without limitation, each Patent (including each design patent and patent
application) referred to in Schedule 1 annexed hereto;
(ii) each Patent License (as defined in the Security Agreement)
owned by Grantor, including, without limitation, each Patent License
identified in Schedule 1 annexed hereto; and
28
29
(iii) all proceeds of and revenues from the foregoing, including,
without limitation, all proceeds of and revenues from any claim by
Grantor against third parties for past, present or future infringement of
any Patent (including any design patent), including, without limitation,
any Patent referred to in Schedule 1 annexed hereto (including, without
limitation, any such Patent issuing from any application referred to in
Schedule 1 annexed hereto), and all rights and benefits of Grantor under
any Patent License, including, without limitation, any Patent License
identified in Schedule 1 annexed hereto.
Grantor hereby irrevocably constitutes and appoints Grantee and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full power and authority in the name of Grantor or
in its name, from time to time, in Grantee's discretion, so long as any Event of
Default (as defined in the Note Purchase Agreement) has occurred and is
continuing, to take with respect to the Patent Collateral any and all
appropriate action which Grantor might take with respect to the Patent
Collateral and to execute any and all documents and instruments which may be
necessary or desirable to carry out the terms of this Patent Security Agreement
and to accomplish the purposes hereof.
This security interest is granted in conjunction with the security
interests granted to Grantee pursuant to the Security Agreement. Grantor does
hereby further acknowledge and affirm that the rights and remedies of Grantee
with respect to the security interest in the Patent Collateral made and granted
hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein.
29
30
IN WITNESS WHEREOF, Grantor has caused this Patent Security Agreement to
be duly executed by its officer thereunto duly authorized as of the ____ day of
____________, 19__.
[COMPANY]
By:
--------------------------
Name:
Title:
Acknowledged:
[MED FUNDING, INC.], as Collateral Agent
By:
--------------------------
Name:
Title:
30
31
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
I, ______________________, a Notary Public in and for said County, in the
State aforesaid, DO HEREBY CERTIFY, that _________________________,
_______________ of [NAME OF COMPANY], personally known to me to be the same
person whose name is subscribed to the foregoing instrument as such
_________________, appeared before me this day in person and acknowledged that
(s)he signed, executed and delivered the said instrument as her/his own free and
voluntary act and as the free and voluntary act of said Company, for the uses
and purposes therein set forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this ___ day of _______________,
19__.
[Seal]
---------------------------------
Signature of notary public
My Commission expires
-----------
31
32
SCHEDULE 1
TO PATENT
SECURITY AGREEMENT
PATENTS
A. U.S. Patents and Design Patents
Patent No. Patent No. Issue Date Title
B. U.S. Patent Applications
Serial No. Date Filed Title
C. Foreign Patents
Patent No. Patent No. Issue Date Title
32
33
PATENT LICENSES
Name of Parties Date of
Agreement Licensor/Licensee Agreement
--------- ----------------- ---------
33
34
EXHIBIT C TO
SECURITY AGREEMENT
TRADEMARK SECURITY AGREEMENT
(TRADEMARKS, TRADEMARK REGISTRATIONS, TRADEMARK
APPLICATIONS AND TRADEMARK LICENSES)
WHEREAS, _______________, a [Delaware] corporation (herein referred to as
"GRANTOR"), owns the Trademarks (as defined in the Security Agreement referred
to below) listed on Schedule 1 annexed hereto, and is a party to the Trademark
Licenses (as defined in the Security Agreement referred to below) identified in
Schedule 1 annexed hereto;
WHEREAS, Grantor, the Subsidiary Guarantors party thereto and [Med
Funding, Inc.] are parties to a Note Purchase Agreement of even date herewith
(as the same may be amended and in effect from time to time among said parties,
the "NOTE PURCHASE AGREEMENT");
WHEREAS, pursuant to the terms of the Security Agreement of even date
herewith (as said Agreement may be amended and in effect from time to time, the
"SECURITY AGREEMENT") among Grantor, [Med Funding, Inc.], as Collateral Agent
for the secured parties referred to therein (in such capacity, together with its
successors in such capacity, "GRANTEE") and certain other parties, Grantor has
granted to Grantee for the benefit of such secured parties a security interest
in substantially all the assets of Grantor, including all right, title and
interest of Grantor in, to and under the Trademark Collateral (as defined
herein), whether now owned or existing or hereafter acquired or arising, to
secure the Secured Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor hereby grants to Grantee,
for the benefit of the Secured Parties (as defined in the Security Agreement), a
continuing security interest in and to all of Grantor's right, title and
interest in and to all of the following property, whether now owned or existing
or hereafter acquired or arising and regardless of where located (all being
collectively referred to as the "TRADEMARK COLLATERAL"):
(i) each Trademark (as defined in the Security Agreement),
including, without limitation, each Trademark registration and
application referred to in Schedule 1 annexed hereto, and all of the
goodwill of the business symbolized thereby or associated with each of
them:
34
35
(ii) each Trademark License (as defined in the Security
Agreement), including, without limitation, each Trademark License
identified in Schedule 1 annexed hereto; and
(iii) all proceeds of and revenues from the foregoing, including,
without limitation, all proceeds of and revenues from any claim by
Grantor against third parties for past, present or future unfair
competition with, or violation of intellectual property rights in
connection with or injury to, or infringement or dilution of, any
Trademark, including, without limitation, any Trademark referred to in
Schedule 1 hereto, and all rights and benefits of Grantor under any
Trademark License, including, without limitation, any Trademark License
identified in Schedule 1 hereto, or for injury to the goodwill associated
with any of the foregoing.
Grantor hereby irrevocably constitutes and appoints Grantee and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full power and authority in the name of Grantor or
in its name, from time to time, in Grantee's discretion, so long as any Event of
Default (as defined in the Note Purchase Agreement) has occurred and is
continuing, to take with respect to the Trademark Collateral any and all
appropriate action which Grantor might take with respect to the Trademark
Collateral and to execute any and all documents and instruments which may be
necessary or desirable to carry out the terms of this Trademark Security
Agreement and to accomplish the purposes hereof.
This security interest is granted in conjunction with the security
interests granted to Grantee pursuant to the Security Agreement. Grantor does
hereby further acknowledge and affirm that the rights and remedies of Grantee
with respect to the security interest in the Trademark Collateral made and
granted hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein.
35
36
IN WITNESS WHEREOF, Grantor has caused this Trademark Security Agreement
to be duly executed by its officer thereunto duly authorized as of the ____ day
of __________, 19__.
[COMPANY]
By:
---------------------------
Name:
Title:
Acknowledged:
[MED FUNDING, INC.], as Collateral Agent
By:
----------------------------
Name:
Title:
36
37
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
I, ______________________, a Notary Public in and for said County, in the
State aforesaid, DO HEREBY CERTIFY, that _________________________,
_______________ of [NAME OF COMPANY], personally known to me to be the same
person whose name is subscribed to the foregoing instrument as such
_________________, appeared before me this day in person and acknowledged that
(s)he signed, executed and delivered the said instrument as her/his own free and
voluntary act and as the free and voluntary act of said Company, for the uses
and purposes therein set forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this ___ day of _______________,
19__.
[Seal]
------------------------------------
Signature of notary public
My Commission expires
--------------
37
38
SCHEDULE 1
TO TRADEMARK
SECURITY AGREEMENT
U.S. TRADEMARKS AND TRADEMARK REGISTRATIONS
A. U.S. Trademarks and Trademark Registrations
Reg. No. Reg. Date Xxxx
B. U.S. Trademark Applications
Serial No. Date Filed Xxxx
TRADEMARK LICENSES
Name of Parties Date of
Agreement Licensor/Licensee Agreement
--------- ----------------- ---------
38
39
EXHIBIT D TO
SECURITY AGREEMENT
COPYRIGHT SECURITY AGREEMENT
(COPYRIGHTS, COPYRIGHT REGISTRATIONS, COPYRIGHT
APPLICATIONS AND COPYRIGHT LICENSES)
WHEREAS, _______________, a [Delaware] corporation (herein referred to as
"GRANTOR") owns the Copyrights (as defined in the Security Agreement referred to
below) listed on Schedule 1 annexed hereto, and is a party to the Copyright
Licenses (as defined in the Security Agreement referred to below) identified in
Schedule 1 annexed hereto;
WHEREAS, Grantor, the Subsidiary Guarantors party thereto and [Med
Funding, Inc.] are parties to a Note Purchase Agreement of even date herewith
(as the same may be amended and in effect from time to time among said parties,
the "NOTE PURCHASE AGREEMENT");
WHEREAS, pursuant to the terms of the Security Agreement of even date
herewith (as said Agreement may be amended and in effect from time to time, the
"SECURITY AGREEMENT") among Grantor, [Med Funding, Inc.], as collateral agent
for the secured parties referred to therein (in such capacity, together with its
successors in such capacity, the "GRANTEE") and certain other parties, Grantor
has granted to Grantee for the benefit of such secured parties a security
interest in substantially all the assets of the Grantor, including all right,
title and interest of Grantor in, to and under the Copyright Collateral (as
defined herein), whether now owned or existing or hereafter acquired or arising,
to secure the Secured Obligations (as defined in the Security Agreement);
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor hereby grants to Grantee,
for the benefit of the Secured Parties (as defined in the Security Agreement), a
continuing security interest in and to all of Grantor's right, title and
interest in and to all of the following property, whether now owned or existing
or hereafter acquired or arising and regardless of where located (all being
collectively referred to as the "COPYRIGHT COLLATERAL"):
(i) each Copyright (as defined in the Security Agreement),
including, without limitation, each Copyright registration and
application referred to in Schedule 1 annexed hereto;
39
40
(ii) each Copyright License (as defined in the Security
Agreement), including, without limitation, each Copyright License
identified in Schedule 1 annexed hereto; and
(iii) all proceeds of and revenues from the foregoing, including,
without limitation, all proceeds of and revenues from any claim by
Grantor against third parties for past, present or future infringement of
any Copyright, including, without limitation, any Copyright referred to
in Schedule 1 annexed hereto, and all rights and benefits of Grantor
under any Copyright License, including, without limitation, any Copyright
License identified in Schedule 1 annexed hereto.
Grantor hereby irrevocably constitutes and appoints Grantee and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full power and authority in the name of Grantor or
in its name, from time to time, in Grantee's discretion, so long as any Event of
Default (as defined in the Note Purchase Agreement) has occurred and is
continuing, to take with respect to the Copyright Collateral any and all
appropriate action which Grantor might take with respect to the Copyright
Collateral and to execute any and all documents and instruments which may be
necessary or desirable to carry out the terms of this Copyright Security
Agreement and to accomplish the purposes hereof.
This security interest is granted in conjunction with the security
interests granted to Grantee pursuant to the Security Agreement. Grantor does
hereby further acknowledge and affirm that the rights and remedies of Grantee
with respect to the security interest in the Copyright Collateral made and
granted hereby are more fully set forth in the Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein.
40
41
IN WITNESS WHEREOF, Grantor has caused this Copyright Security Agreement
to be duly executed by its officer thereunto duly authorized as of the ____ day
of _______, 19__.
[COMPANY]
By:
-------------------------
Name:
Title:
Acknowledged:
[Med Funding, Inc]., as Collateral Agent
By:
---------------------------
Name:
Title:
41
42
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
I, ______________________, a Notary Public in and for said County, in the
State aforesaid, DO HEREBY CERTIFY, that _________________________,
_______________ of [NAME OF COMPANY], personally known to me to be the same
person whose name is subscribed to the foregoing instrument as such
_________________, appeared before me this day in person and acknowledged that
(s)he signed, executed and delivered the said instrument as her/his own free and
voluntary act and as the free and voluntary act of said Company, for the uses
and purposes therein set forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this ___ day of _______________,
19__.
[Seal]
------------------------------------
Signature of notary public
My Commission expires
--------------
42
43
SCHEDULE 1
TO COPYRIGHT
SECURITY AGREEMENT
COPYRIGHT REGISTRATIONS
Registration No. Reg. Date Title
COPYRIGHT APPLICATIONS
Serial No. Date Filed Title
43
44
EXHIBIT E TO
SECURITY AGREEMENT
PLEDGED DEPOSIT AGREEMENT
AGREEMENT dated as of ___________, 19__ among __________________________
(the "BANK"), ____________________________________, a _____________ corporation
(the "DEPOSITOR"), and [MED FUNDING, INC.,] as Collateral Agent (with its
successors in such capacity, the "COLLATERAL AGENT") under the Security
Agreement referenced below.
WHEREAS, Medaphis Corporation, the Subsidiary Guarantors party thereto
and [Med Funding, Inc.] are parties to a Note Purchase Agreement, dated as of
December __, 1997, as the same may be hereafter amended, restated or
supplemented (the "NOTE PURCHASE AGREEMENT");
WHEREAS, the Depositor [, a Subsidiary Guarantor under the Note Purchase
Agreement,] has established with the Bank a bank account number ________________
(the "ACCOUNT") into which it is contemplated that the Depositor from time to
time may deposit payments or other remittances now or hereafter received by the
Depositor on some or all of its accounts, contract rights, chattel paper,
instruments, drafts, general intangibles or other collateral in which the
Depositor has granted to the Collateral Agent a security interest pursuant to a
Security Agreement dated as of December ___, 1997 (as amended, the "SECURITY
AGREEMENT");
WHEREAS, pursuant to the Security Agreement, the Depositor has granted to
the Collateral Agent a security interest in the Account and all funds on deposit
therein; and
WHEREAS, the parties desire to enter into this Agreement in order to set
forth their relative rights and duties with respect to the Account and all
amounts on deposit therein from time to time.
NOW, THEREFORE, the parties hereby agree as follows:
1. The Depositor and the Bank hereby confirm to the Collateral Agent that
the Account has been established by the Depositor with the Bank, and the
Depositor hereby irrevocably authorizes, instructs and directs the Bank, from
and after the Bank's receipt of written notice from the Collateral Agent that an
"Event of Default" has occurred and is continuing under (and as such term is
defined in) the Note Purchase Agreement (any such notice being hereinafter
called a "DEFAULT NOTICE"), to honor only the instructions and directions of the
Collateral Agent with respect to any distributions, transfers or
44
45
withdrawals of funds from or the investment of funds in the Account. Prior to
the Bank's receipt of any Default Notice, the Bank shall honor the Depositor's
instructions and directions with respect to the distribution,
2. The Bank hereby agrees that, except to the extent expressly provided
in Section 4 below, it will not exercise or claim any right of offset against,
security interest in or banker's lien on the Account or any funds on deposit
therein, and the Bank hereby further waivers and releases any such right,
interest or lien which it may have against any of the funds deposited in the
Account from and after its receipt of any Default Notice, except to the extent
expressly set forth in Section 4 below.
3. The Depositor hereby acknowledges that it has granted to the
Collateral Agent a present and continuing security interest in the Account and
all funds on deposit therein from time to time to the Collateral Agent as
collateral security for the Secured Obligations (as defined in the Security
Agreement), and the Depositor hereby authorizes and directs the Bank to hold the
Account and all funds on deposit therein from time to time as bailee for the
Collateral Agent, and the Bank hereby agrees to act as such bailee for the
Collateral Agent.
4. From and after the Bank's receipt of any Default Notice, the
Collateral Agent shall have the sole right to direct that any distributions,
transfers or withdrawals be made from the Account, and the Depositor shall not
have any right thereafter to transfer or withdraw any sums from the Account,
whether by check, draft, wire transfer or otherwise. If any checks, drafts or
other items deposited in the Account are returned unpaid or otherwise dishonored
after the Bank's receipt of the Default Notice, the Bank shall have the right to
charge any and all such returned or dishonored items against the Account, as
well as charging the Account for the Bank's customary fees and charges for
administering or otherwise handling the Account, or to demand reimbursement
therefor from the Depositor directly. If the balance of collected funds in the
Account is insufficient for such purpose at any time after the Bank's receipt of
a Default Notice, the Bank will immediately notify the Depositor and the
Collateral Agent of such fact and the Collateral Agent will reimburse the Bank
for any loss it may suffer if such items cannot be collected but (A) only if the
proceeds of such items have been previously transferred to the Collateral Agent
pursuant to this Agreement and (B) only to the extent the Bank is not reimbursed
therefor by the Depositor after demand by the Bank.
5. This Agreement may be terminated by the Depositor but only with the
express prior written consent of the Collateral Agent, and in that case the
Collateral Agent and the Depositor shall jointly notify the Bank of such
termination. This Agreement may be terminated by the Collateral Agent at any
time upon its delivery of written notice thereof to each of the Depositor and
the Bank. This Agreement may be terminated by the Bank at any time on not less
than fifteen (15) day's prior written notice of such intention delivered by it
to each of the Depositor and the Collateral Agent. The Bank's reimbursement and
indemnity rights against the Depositor and the Collateral Agent under
45
46
Section 4 above and Section 7 below shall survive any termination of this
Agreement. Upon any termination of this Agreement, all funds in the Account
shall be forwarded by the Bank directly to the Depositor unless the Bank has
received a Default Notice on or before such termination in which case such funds
shall be forwarded by the Bank directly to the Collateral Agent.
6. The Bank shall be entitled to rely conclusively upon any Default
Notice it receives from the Collateral Agent and the Bank shall have no
obligation to investigate or verify the genuineness or correctness of any such
Default Notice. The Bank shall have no liability to Depositor for the Bank's
honoring of any instructions or directions regarding the Account which the Bank
receives from Collateral Agent from or after the Bank's receipt of a Default
Notice and the Bank shall be fully discharged from liability with respect to any
funds on deposit in the Account to the extent it honors such instructions and
transfers same to or at the direction of the Collateral Agent.
7. The Collateral Agent hereby agrees to indemnify the Bank and hold it
harmless against any loss, damage or expense it may suffer (including attorney's
fees, court costs and other litigation expenses) as a result of the Bank's
entering into this Agreement, honoring any instructions or directions it
receives from the Collateral Agent with respect to the Account after the Bank's
receipt of any Default Notice or not honoring any instructions it receives from
the Depositor with respect to the Account after the Bank's receipt of any
Default Notice, except to the extent such loss, damage or expense is the result
of the Bank's own gross negligence or wilful misconduct.
8. All notices or other communications required or provided under this
Agreement shall be in writing and shall be sent to each party at its respective
address set forth beneath its signature below (or at such other address as such
party may designate in writing to the other parties). Such notices or
communications shall be effective on the date received if received prior to
12:00 Noon (Atlanta time) on any business day of the Bank (or, if after 12:00
Noon or if on a non-business day, such notice or communication shall be
effective on the immediately succeeding business day of the Bank).
9. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns, but neither the
Depositor nor the Bank shall be entitled to assign or delegate any of its rights
or duties hereunder without first obtaining the express prior written consent of
the Collateral Agent.
10. This Agreement shall be governed by the laws of the State of New York
(without giving effect to its conflicts of law rules).
11. This Agreement may be executed in any number of several counterparts.
46
47
IN WITNESS WHEREOF, each of the parties has executed and delivered this
Agreement as of the day and year first above set forth.
BANK:
----------------------------------------
By:
----------------------------------
Name:
Title:
Address:
DEPOSITOR
By:
----------------------------------
Name:
Title:
Address:
COLLATERAL AGENT:
[MED FUNDING, INC.]
By:
----------------------------------
Name:
Title:
47
48
EXHIBIT F TO
SECURITY AGREEMENT
[WACHOVIA] ADDENDUM
TO SECURITY AGREEMENT AND PLEDGE AGREEMENT
ADDENDUM dated as of _______________ ____, 199__ to the Security
Agreement dated as of December ___, 1997 (as amended from time to time, the
"SECURITY AGREEMENT") among Medaphis Corporation (the "COMPANY"), the other
Grantors thereunder and [Med Funding, Inc.,] as Collateral Agent (together with
its successors in such capacity, the "COLLATERAL AGENT") and to the Pledge
Agreement dated as of December ___, 1997 (as amended from time to time, the
"PLEDGE AGREEMENT") among the Company, the other Grantors thereunder and the
Collateral Agent. Capitalized terms used but not defined herein are used herein
as defined in the Security Agreement.
1. [Wachovia Bank, N.A.] (["WACHOVIA"]) and certain of its affiliates
provide cash management services for the Company and its subsidiaries, and each
Grantor has agreed to grant a continuing security interest in and to all of its
right, title and interest in and to the Collateral under the Security Agreement
and Pledge Agreement to secure its Cash Management Services Obligations, subject
to the limitations contained in the Security Agreement and Pledge Agreement.
2. [Wachovia] acknowledges and agrees that from and after the date when
the Collateral Agent shall receive this Addendum, duly executed by [Wachovia],
(i) the Cash Management Obligations will become Secured Obligations under the
Security Agreement and Pledge Agreement, subject to the limitations contained
therein, and (ii) [Wachovia] shall become a Secured Party thereunder, and shall
thereupon become entitled to the benefits, and be bound by the obligations,
under the Agreement and Pledge Agreement as a Secured Party, including without
limitation Section 10 of the Security Agreement.
48
49
IN WITNESS WHEREOF, the undersigned has caused this Addendum to be duly
executed by its duly authorized officer as of the date first above written.
[WACHOVIA BANK, N.A.]
By:
-------------------------------------
Name:
Title:
Address:
Accepted and Acknowledged:
[MED FUNDING, INC.]
By:
------------------------------------
Name:
Title:
49
