Exhibit 10.2

 

Execution Copy

 

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GUARANTEE AND COLLATERAL AGREEMENT

 

dated as of

 

January 31, 2006

 

among

 

AMERIPATH HOLDINGS, INC.,

 

AMERIPATH, INC.,

 

THE SUBSIDIARIES OF AMERIPATH, INC.

IDENTIFIED HEREIN

 

and

 

WACHOVIA BANK, NATIONAL ASSOCIATION

 

as Collateral Agent

 

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TABLE OF CONTENTS

 

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ARTICLE I DEFINITIONS Section 1.01.   Credit Agreement    1 Section 1.02.  
Other Defined Terms    1 ARTICLE II GUARANTEE Section 2.01.   Guarantee    6
Section 2.02.   Guarantee of Payment    6 Section 2.03.   No Limitations    6
Section 2.04.   Reinstatement    7 Section 2.05.   Agreement To Pay; Subrogation
   7 Section 2.06.   Information    7 ARTICLE III PLEDGE OF SECURITIES Section
3.01.   Pledge    8 Section 3.02.   Delivery of the Pledged Collateral    8
Section 3.03.   Representations, Warranties and Covenants    9 Section 3.04.  
Certification of Limited Liability Company and Limited Partnership Interests   
10 Section 3.05.   Registration in Nominee Name; Denominations    10
Section 3.06.   Voting Rights; Dividends and Interest    11 ARTICLE IV SECURITY
INTERESTS IN PERSONAL PROPERTY Section 4.01.   Security Interest    12 Section
4.02.   Representations and Warranties    14 Section 4.03.   Covenants    16
Section 4.04.   Other Actions    19 Section 4.05.   Covenants Regarding Patent,
Trademark and Copyright Collateral    21 Section 4.06.   Cash Management System,
Securities Accounts and Commodity Accounts    22

 

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ARTICLE V REMEDIES Section 5.01.   Remedies upon Default    24 Section 5.02.  
Application of Proceeds    25 Section 5.03.   Grant of License To Use
Intellectual Property    26 Section 5.04.   Securities Act    26 Section 5.05.  
Medicare/Medicaid    27 Section 5.06. .   The parties hereto understand and
agree that the exercise of remedies hereunder with respect to receivables from
Medicare or Medicaid may be subject to applicable federal laws.    27 ARTICLE VI
INDEMNITY, SUBROGATION AND SUBORDINATION Section 6.01.   Indemnity and
Subrogation    27 Section 6.02.   Contribution and Subrogation    27 Section
6.03.   Subordination    27 ARTICLE VII MISCELLANEOUS Section 7.01.   Notices   
28 Section 7.02.   Waivers; Amendment    28 Section 7.03.   Collateral Agent’s
Fees and Expenses; Indemnification    28 Section 7.04.   Successors and Assigns
   29 Section 7.05.   Survival of Agreement    29 Section 7.06.   Counterparts;
Effectiveness; Several Agreement    29 Section 7.07.   Severability    30
Section 7.08.   Right of Set-Off    30 Section 7.09.   Governing Law;
Jurisdiction; Consent to Service of Process    30 Section 7.10.   WAIVER OF JURY
TRIAL    31 Section 7.11.   Headings    31 Section 7.12.   Security Interest
Absolute    31 Section 7.13.   Termination or Release    32 Section 7.14.  
Additional Subsidiaries    32 Section 7.15.   Collateral Agent Appointed
Attorney-in-Fact    33 Section 7.16.   Further Assurances    33

 

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Schedules

     Schedule I    Subsidiary Loan Parties Schedule II    Pledged Stock; Debt
Securities Schedule III    Intellectual Property Schedule IV    Commercial Tort
Claims Schedule V    Deposit Accounts Schedule VI    Securities Accounts
Exhibits      Exhibit I    Form of Supplement Exhibit II    Form of Deposit
Account Control Agreement Exhibit III    Form of Securities Account Control
Agreement

 

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GUARANTEE AND COLLATERAL AGREEMENT (this “Agreement”) dated as of January 31,
2006, among AMERIPATH HOLDINGS, INC., a Delaware corporation, AMERIPATH, INC., a
Delaware corporation, the Subsidiaries of AMERIPATH, INC. identified herein and
WACHOVIA BANK, NATIONAL ASSOCIATION, as Collateral Agent.

 

Reference is made to the Credit Agreement dated as of January 31, 2006 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Ameripath, Inc. (the “Borrower”), Ameripath Holdings, Inc.,
the Lenders party thereto, Wachovia Bank, National Association, as
Administrative Agent, Citigroup Global Markets Inc., as Syndication Agent, and
Deutsche Bank Securities Inc. and UBS Securities LLC, as Co-Documentation
Agents. The Lenders have agreed to extend credit to the Borrower subject to the
terms and conditions set forth in the Credit Agreement. The obligations of the
Lenders to extend such credit are conditioned upon, among other things, the
execution and delivery of this Agreement. Holdings and the Subsidiary Loan
Parties are affiliates of the Borrower, will derive substantial benefits from
the extension of credit to the Borrower pursuant to the Credit Agreement and are
willing to execute and deliver this Agreement in order to induce the Lenders to
extend such credit. Accordingly, the parties hereto agree as follows:

 

ARTICLE I

 

Definitions

 

Section 1.01. Credit Agreement. (a) Capitalized terms used in this Agreement and
not otherwise defined in this Agreement have the meanings specified in the
Credit Agreement. All terms defined in the New York UCC (as defined in this
Agreement) and not defined in this Agreement have the meanings specified
therein.

 

(b) The rules of construction specified in Section 1.03 of the Credit Agreement
also apply to this Agreement, mutatis mutandis.

 

Section 1.02. Other Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:

 

“Account Debtor” means any Person who is or who may become obligated to any
Grantor under, with respect to or on account of an Account.

 

“Article 9 Collateral” has the meaning assigned to such term in Section 4.01.

 

“Collateral” means Article 9 Collateral and Pledged Collateral.

 

“Commodity Account Control Agreement” means a control agreement in a form that
is reasonably satisfactory to the Collateral Agent and the Borrower establishing
the Collateral Agent’s Control with respect to any Commodity Account.

 

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“Contributing Party” shall have the meaning assigned to such term in
Section 6.02.

 

“Control” shall mean (i) in the case of each Deposit Account, “control”, as such
term is defined in Section 9-104 of the New York UCC, (ii) in the case of any
Securities Account, “control” as such term is defined in Section 8-106 of the
New York UCC, and (iii) in the case of any Commodity Account, “control”, as such
term is defined in section 9-106 of the New York UCC.

 

“Control Agreements” means, collectively, the Deposit Account Control
Agreements, the Securities Account Control Agreements and the Commodity Account
Control Agreements.

 

“Copyright License” means any written agreement, now or hereafter in effect,
granting any right to any third party under any copyright now or hereafter owned
by any Grantor or that such Grantor otherwise has the right to license, or
granting any right to any Grantor under any copyright now or hereafter owned by
any third party, and all rights of any Grantor under any such agreement.

 

“Copyrights” means all of the following now owned or hereafter acquired by any
Grantor: (a) all copyright rights in any work subject to the copyright laws of
the United States or any other country, whether as author, assignee, transferee
or otherwise and (b) all registrations and applications for registration of any
such copyright in the United States or any other country, including
registrations, recordings, supplemental registrations and pending applications
for registration in the United States Copyright Office, including those listed
on Schedule III.

 

“Credit Agreement” has the meaning assigned to such term in the preliminary
statement in this Agreement.

 

“Deposit Account Control Agreement” means an agreement substantially in the form
annexed hereto as Exhibit II or such other form as is reasonably satisfactory to
the Collateral Agent and the Borrower establishing Collateral Agent’s Control
with respect to any Deposit Account.

 

“Deposit Accounts” means, collectively, with respect to each Grantor, (i) all
“deposit accounts” as such term is defined in the New York UCC and in any event
shall include the LC Account and all accounts and sub-accounts relating to any
of the foregoing accounts and (ii) all cash, funds, checks, notes and
instruments from time to time on deposit in any of the accounts or sub-accounts
described in clause (i) of this definition.

 

“Excluded Accounts” shall have the meaning assigned to such term in
Section 4.06(c).

 

“Federal Securities Laws” has the meaning assigned to such term in Section 5.04.

 

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“General Intangibles” means all “General Intangibles” of any Grantor as defined
in Section 9-102(42) of the New York UCC.

 

“Grantors” means Holdings, the Borrower and the Subsidiary Loan Parties.

 

“Guarantors” means Holdings and the Subsidiary Loan Parties.

 

“Instrument” has the meaning specified in Article 9 of the New York UCC.

 

“Intellectual Property” means all intellectual and similar property of any
Grantor of every kind and nature now owned or hereafter acquired by any Grantor,
including inventions, designs, Patents, Copyrights, Licenses, Trademarks, trade
secrets, confidential or proprietary technical and business information,
know-how or other data or information, software and databases and all
embodiments or fixations thereof and related documentation, registrations and
franchises, and all additions, improvements and accessions to, and books and
records describing or used in connection with, any of the foregoing.

 

“Investment Property” means a security, whether certificated or uncertificated,
Security Entitlement, Securities Account, Commodity Contract or Commodity
Account.

 

“LC Account” means any account established and maintained in accordance with the
provisions of Section 2.05(j) of the Credit Agreement and all property from time
to time on deposit in such LC Account.

 

“License” means any Patent License, Trademark License, Copyright License or
other license or sublicense agreement to which any Grantor is a party, including
those listed on Schedule III.

 

“Loan Document Obligations” means (a) the due and punctual payment by the
Borrower of (i) the principal of and interest (including interest accruing
during the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding) on
the Loans, when and as due, whether at maturity, by acceleration, upon one or
more dates set for prepayment or otherwise, (ii) each payment required to be
made by the Borrower under the Credit Agreement in respect of any Letter of
Credit, when and as due, including payments in respect of reimbursement of
disbursements, interest thereon (including interest accruing during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding) and obligations
to provide cash collateral, and (iii) all other monetary obligations of the
Borrower to any of the Secured Parties under the Credit Agreement and each other
Loan Document, including obligations to pay fees, expense reimbursement
obligations and indemnification obligations, whether primary, secondary, direct,
contingent, fixed or otherwise (including monetary obligations incurred during
the pendency of any bankruptcy, insolvency, receivership or other similar
proceeding, regardless of whether allowed or allowable in such proceeding),
(b) the due and punctual performance of all other obligations of the Borrower
under or pursuant to the Credit Agreement and each other Loan Document, and
(c) the due and punctual payment and performance in full of all the obligations
of each other Loan Party under or pursuant to this Agreement and each other Loan
Document.

 

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“Medicare” shall mean that government-sponsored entitlement program under Title
XVIII of the Social Security Act that provides for a health insurance system for
eligible elderly and disabled individuals (Social Security Act of 1965, Title
XVIII, P.L. 89-87 as amended; 42 U.S.C. § 1395 et seq.).

 

“Medicaid” shall mean that means-tested entitlement program under Title XIX of
the Social Security Act that provides federal grants to states for medical
assistance based on specific eligibility criteria (Social Security Act of 1965,
Title XIX, P.L. 89-87, as amended; 42 U.S.C. § 1396 et seq.).

 

“Medicare Deposit Account” means any Deposit Account into which receivables
under Medicare and/or Medicaid are paid to any Grantor.

 

“New York UCC” means the Uniform Commercial Code as from time to time in effect
in the State of New York.

 

“Non-Excluded Accounts” has the meaning assigned to such term in
Section 4.06(c).

 

“Obligations” means (a) Loan Document Obligations and (b) the due and punctual
payment and performance in full of all obligations of each Loan Party under each
Swap Agreement that (i) is in effect on the Effective Date with a counterparty
that is a Lender or an Affiliate of a Lender as of the Effective Date or (ii) is
entered into after the Effective Date with any counterparty that is a Lender or
an Affiliate of a Lender at the time such Swap Agreement is entered into.

 

“Patent License” means any written agreement, now or hereafter in effect,
granting to any third party any right to make, use or sell any invention on
which a patent, now or hereafter owned by any Grantor or that any Grantor
otherwise has the right to license, is in existence, or granting to any Grantor
any right to make, use or sell any invention on which a patent, now or hereafter
owned by any third party, is in existence, and all rights of any Grantor under
any such agreement.

 

“Patents” means all of the following now owned or hereafter acquired by any
Grantor: (a) all letters patent of the United States or the equivalent thereof
in any other country, all registrations and recordings thereof, and all
applications for letters patent of the United States or the equivalent thereof
in any other country, including registrations, recordings and pending
applications in the United States Patent and Trademark Office or any similar
offices in any other country, including those listed on Schedule III, and
(b) all reissues, continuations, divisions, continuations-in-part, renewals or
extensions thereof, and the inventions disclosed or claimed therein, including
the right to make, use and/or sell the inventions disclosed or claimed therein.

 

“Pledged Collateral” has the meaning assigned to such term in Section 3.01.

 

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“Pledged Debt Securities” has the meaning assigned to such term in Section 3.01.

 

“Pledged Securities” means any promissory notes, stock certificates or other
securities now or hereafter included in the Pledged Collateral, including all
certificates, instruments or other documents representing or evidencing any
Pledged Collateral.

 

“Pledged Stock” has the meaning assigned to such term in Section 3.01.

 

“Proceeds” has the meaning specified in Section 9-102 of the New York UCC.

 

“Secured Parties” means (a) the Lenders, (b) the Collateral Agent, (c) the
Administrative Agent, (d) the Issuing Bank, (e) each counterparty that is a
Lender or an Affiliate of a Lender to any Swap Agreement with a Loan Party the
obligations under which constitute Obligations and (f) the successors and
assigns of each of the foregoing.

 

“Securities Account Control Agreement” means an agreement substantially in the
form annexed hereto as Exhibit III or an agreement in a form that is reasonably
satisfactory to the Collateral Agent and the Borrower establishing the
Collateral Agent’s Control with respect to any Securities Account.

 

“Security Interest” has the meaning assigned to such term in Section 4.01.

 

“Subsidiary Loan Parties” means (a) the Subsidiaries identified on Schedule I
and (b) each other Subsidiary that becomes a party to this Agreement as a
Subsidiary Loan Party after the Effective Date.

 

“Trademark License” means any written agreement, now or hereafter in effect,
granting to any third party any right to use any trademark now or hereafter
owned by any Grantor or that any Grantor otherwise has the right to license, or
granting to any Grantor any right to use any trademark now or hereafter owned by
any third party, and all rights of any Grantor under any such agreement.

 

“Trademarks” means all of the following now owned or hereafter acquired by any
Grantor: (a) all trademarks, service marks, trade names, domain names, corporate
names, company names, business names, fictitious business names, trade styles,
trade dress, logos, other source or business identifiers, designs and general
intangibles of like nature, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all registration and recording
applications filed in connection therewith, including registrations and
registration applications in the United States Patent and Trademark Office or
any similar offices in any State of the United States or any other country or
any political subdivision thereof, and all extensions or renewals thereof,
including those listed on Schedule III, (b) all goodwill associated therewith or
symbolized thereby and (c) all other assets, rights and interests that uniquely
reflect or embody such goodwill.

 

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ARTICLE II

 

Guarantee

 

Section 2.01. Guarantee. Each Guarantor unconditionally guarantees, jointly with
the other Guarantors and severally, as a primary obligor and not merely as a
surety, the due and punctual payment and performance in full of the Obligations.
Each Guarantor further agrees that the Obligations may be extended or renewed,
in whole or in part, or amended or modified, without notice to or further assent
from it, and that it will remain bound upon its guarantee notwithstanding any
extension, renewal, amendment or modification of the Obligations. Each Guarantor
waives presentment to, demand of payment from and protest to the Borrower or any
other Loan Party of the Obligations and also waives notice of acceptance of its
guarantee and notice of protest for nonpayment.

 

Section 2.02. Guarantee of Payment. Each Guarantor further agrees that its
guarantee hereunder constitutes a guarantee of payment when due and not of
collection, and waives any right to require that any resort be had by the
Collateral Agent or any other Secured Party to any security held for the payment
of the Obligations or to any balance of any Deposit Account or credit on the
books of the Collateral Agent or any other Secured Party in favor of the
Borrower or any other Person.

 

Section 2.03. No Limitations. (a) Except for termination of a Guarantor’s
obligations hereunder as expressly provided in Section 7.13, the obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to any
defense or set-off, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of
each Guarantor hereunder shall not be discharged or impaired or otherwise
affected by (i) the failure of the Collateral Agent or any other Secured Party
to assert any claim or demand or to enforce any right or remedy under the
provisions of any Loan Document or otherwise; (ii) any rescission, waiver,
amendment or modification of, or any release from any of the terms or provisions
of, any Loan Document or any other agreement, including with respect to any
other Guarantor under this Agreement; (iii) the release of, impairment of or
failure to perfect any Lien held by the Collateral Agent or any other Secured
Party for the payment and performance of the Obligations or any of them;
(iv) any default, failure or delay, wilful or otherwise, in the performance of
the Obligations; or (v) any other act or omission that may or might in any
manner or to any extent vary the risk of any Guarantor or otherwise operate as a
discharge of any Guarantor as a matter of law or equity (other than the
indefeasible payment in full in cash of the Obligations). Each Guarantor
expressly authorizes the Collateral Agent (i) to take and hold security for the
payment and performance of the Obligations, (ii) to exchange, waive or release
any or all such security (with or without consideration), (iii) to enforce or
apply such security and direct the order and manner of any sale thereof in its
sole discretion or (iv) to release or substitute any one or more other
guarantors or obligors upon or in respect of the Obligations, all without
affecting the obligations of any Guarantor hereunder.

 

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(b) To the fullest extent permitted by applicable law, each Guarantor waives any
defense based on or arising out of any defense of the Borrower or any other Loan
Party or the unenforceability of the Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of the Borrower or any
other Loan Party, other than the indefeasible payment in full in cash of all the
Obligations. The Collateral Agent and the other Secured Parties may, at their
election, foreclose on any security held by one or more of them by one or more
judicial or nonjudicial sales, accept an assignment of any such security in lieu
of foreclosure, compromise or adjust any part of the Obligations, make any other
accommodation with the Borrower or any other Loan Party or exercise any other
right or remedy available to them against the Borrower or any other Loan Party,
without affecting or impairing in any way the liability of any Guarantor
hereunder except to the extent the Obligations have been fully and indefeasibly
paid in full in cash. To the fullest extent permitted by applicable law, each
Guarantor waives any defense arising out of any such election even though such
election operates, pursuant to applicable law, to impair or to extinguish any
right of reimbursement or subrogation or other right or remedy of such Guarantor
against the Borrower or any other Loan Party, as applicable, or any security.

 

Section 2.04. Reinstatement. Each of the Guarantors agrees that its guarantee
hereunder shall continue to be effective or be reinstated, as applicable, if at
any time payment, or any part thereof, of any Obligation is rescinded or must
otherwise be restored by the Collateral Agent or any other Secured Party upon
the bankruptcy or reorganization of the Borrower, any other Loan Party or
otherwise.

 

Section 2.05. Agreement To Pay; Subrogation. In furtherance of the foregoing and
not in limitation of any other right that the Collateral Agent or any other
Secured Party has at law or in equity against any Guarantor by virtue hereof,
upon the failure of the Borrower or any other Loan Party to pay any Obligation
when and as the same shall become due, whether at maturity, by acceleration,
after notice of prepayment or otherwise, each Guarantor hereby promises to and
will forthwith pay, or cause to be paid, to the Collateral Agent for
distribution to the applicable Secured Parties in cash the amount of such unpaid
Obligation. Upon payment by any Guarantor of any sums to the Collateral Agent as
provided above, all rights of such Guarantor against the Borrower or any other
Loan Party arising as a result thereof by way of right of subrogation,
contribution, reimbursement, indemnity or otherwise shall in all respects be
subject to Article VI.

 

Section 2.06. Information. Each Guarantor assumes all responsibility for being
and keeping itself informed of the Borrower’s and each other Loan Party’s
financial condition and assets and of all other circumstances bearing upon the
risk of nonpayment of the Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder and agrees that none of
the Collateral Agent or the other Secured Parties will have any duty to advise
such Guarantor of information known to it or any of them regarding such
circumstances or risks.

 

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ARTICLE III

 

Pledge of Securities

 

Section 3.01. Pledge. As security for the payment or performance, as applicable,
in full of the Obligations, each Grantor hereby grants to the Collateral Agent,
its successors and assigns, for the ratable benefit of the Secured Parties, a
security interest in, all of such Grantor’s right, title and interest in, to and
under (a) the shares of capital stock and other Equity Interests of the Borrower
and each Subsidiary owned by it and listed on Schedule II and any other Equity
Interests of a Subsidiary obtained in the future by such Grantor and the
certificates representing all such Equity Interests (the “Pledged Stock”),
provided that the Pledged Stock shall not include more than 65% of the
outstanding voting Equity Interests of any Foreign Subsidiary; (b)(i) the debt
securities listed opposite the name of such Grantor on Schedule II, (ii) any
debt securities issued after the Effective Date to such Grantor by Holdings, the
Borrower and each Subsidiary and (iii) the promissory notes and any other
instruments evidencing such debt securities (the “Pledged Debt Securities”);
(c) all other property that may be delivered to and held by the Collateral Agent
pursuant to the terms of this Section 3.01; (d) subject to Section 3.06, all
payments of principal or interest, dividends, cash, instruments and other
property from time to time received, receivable or otherwise distributed in
respect of, in exchange for or upon the conversion of, and all other Proceeds
received in respect of, the securities referred to in clauses (a), (b) and
(c) above; (e) subject to Section 3.06, all rights and privileges of such
Grantor with respect to the securities and other property referred to in
clauses (a), (b), (c) and (d) above; and (f) all Proceeds of any of the
foregoing (the items referred to in clauses (a) through (f) above being
collectively referred to as the “Pledged Collateral”).

 

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Collateral Agent, its successors and assigns, for the ratable benefit
of the Secured Parties, forever, subject, however, to the terms, covenants and
conditions hereinafter set forth.

 

Section 3.02. Delivery of the Pledged Collateral. (a) Each Grantor represents
and warrants that all certificates, agreements or instruments representing or
evidencing the Pledged Collateral in existence on the date hereof have been
delivered to the Collateral Agent in suitable form for transfer by delivery or
accompanied by duly executed instruments of transfer or assignment in blank.
Each Grantor agrees promptly to deliver or cause to be delivered to the
Collateral Agent any and all Pledged Securities.

 

(b) Each Grantor will cause any Indebtedness for borrowed money owed to such
Grantor by any Person (other than a Loan Party) which is (A) in excess of
$1,000,000 and (B) evidenced by a duly executed promissory note to be pledged
and delivered to the Collateral Agent pursuant to the terms hereof.

 

(c) Upon delivery to the Collateral Agent, (i) any Pledged Securities shall be
accompanied by undated stock powers duly executed in blank or other undated
instruments of transfer reasonably satisfactory to the Collateral Agent and by
such other instruments and documents as the Collateral Agent may reasonably
request and (ii) all other property comprising part of the Pledged Collateral
shall be accompanied by proper instruments of assignment duly

 

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executed by the applicable Grantor and such other instruments or documents as
the Collateral Agent may reasonably request. Each delivery of Pledged Securities
shall be accompanied by a schedule describing such Pledged Securities, which
schedule shall be attached hereto as a supplement to Schedule II and made a part
hereof, provided that failure to attach any such schedule hereto shall not
affect the validity of such pledge of such Pledged Securities. Each schedule so
delivered shall supplement any prior schedules so delivered.

 

Section 3.03. Representations, Warranties and Covenants. The Grantors jointly
and severally represent, warrant and covenant to and with the Collateral Agent,
for the benefit of the Secured Parties, that:

 

(a) Schedule II correctly sets forth the percentage of the issued and
outstanding shares (or units or other comparable measure) of each class of the
Equity Interests of the issuer thereof represented by the Pledged Stock and
includes all Equity Interests, debt securities and promissory notes required to
be pledged hereunder in order to satisfy the Collateral and Guarantee
Requirement;

 

(b) the Pledged Stock and Pledged Debt Securities have been duly and validly
authorized and issued by the issuers thereof and (i) in the case of Pledged
Stock, are fully paid and nonassessable and (ii) in the case of Pledged Debt
Securities, are legal, valid and binding obligations of the issuers thereof;

 

(c) except for the security interests granted hereunder, each of the Grantors
(i) is and, subject to any transfers made in compliance with the Credit
Agreement, will continue to be the direct owner, beneficially and of record, of
the Pledged Securities indicated on Schedule II as owned by such Grantor,
(ii) holds the same free and clear of all Liens, other than Liens created by any
Loan Document and Liens permitted by Section 6.02 of the Credit Agreement,
(iii) will make no assignment, pledge, hypothecation or transfer of, or create
or permit to exist any security interest in or other Lien on, the Pledged
Collateral, other than Liens created by any Loan Document, Liens permitted by
Section 6.02 of the Credit Agreement and transfers made in compliance with the
Credit Agreement and (iv) will defend its title or interest thereto or therein
against any and all Liens (other than Liens created by any Loan Document and
Liens permitted by Section 6.02 of the Credit Agreement), however arising, of
all Persons whomsoever; provided that nothing in this Agreement shall prevent
any Grantor from discontinuing the operation or maintenance of any of its assets
or properties if such discontinuance is (x) in the good faith determination of
its Board of Directors, desirable in the conduct of its business and
(y) permitted by the Credit Agreement;

 

(d) except for restrictions and limitations imposed by (i) the Loan Documents,
(ii) securities laws generally or (iii) customary provisions in joint venture
agreements relating to purchase options, rights of first refusal, tag, drag,
call or similar rights of a third party that owns Equity Interests in such joint
venture, the Pledged Collateral is and will continue to be freely transferable
and assignable, and none of the Pledged Collateral is or will be subject to any
option, right of first refusal, shareholders agreement, charter or by-law
provision or contractual restriction of any nature that might prohibit, impair,
delay or otherwise affect the pledge of such Pledged Collateral hereunder, the
sale or disposition thereof pursuant hereto or the exercise by the Collateral
Agent of rights and remedies hereunder;

 

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(e) each of the Grantors has the power and authority to pledge the Pledged
Collateral pledged by it hereunder in the manner hereby done or contemplated;

 

(f) no consent or approval of any Governmental Authority, any securities
exchange or any other Person was or is necessary to the validity of the pledge
effected hereby (other than such as have been obtained and are in full force and
effect);

 

(g) subject to clauses (c) and (d) of this Section 3.03, by virtue of the
execution and delivery by the Grantors of this Agreement, when any Pledged
Securities are delivered to the Collateral Agent in accordance with this
Agreement, the Collateral Agent will obtain, for the benefit of the Secured
Parties, a legal, valid and perfected lien upon and security interest in such
Pledged Securities as security for the payment and performance of the
Obligations; and

 

(h) the pledge effected hereby is effective to vest in the Collateral Agent, for
the ratable benefit of the Secured Parties, the rights of the Collateral Agent
in the Pledged Collateral as set forth in this Agreement.

 

Section 3.04. Certification of Limited Liability Company and Limited Partnership
Interests. (a) Each Grantor acknowledges and agrees that each interest in any
limited liability company or limited partnership controlled by any Grantor and
acquired after the Effective Date and pledged hereunder that is represented by a
certificate, shall be a “security” within the meaning of Article 8 of the New
York UCC and shall be governed by Article 8 of the New York UCC.

 

(b) Each Grantor further acknowledges and agrees that (i) the interests in any
limited liability company or limited partnership controlled by such Grantor and
pledged hereunder that are not represented by a certificate are not “securities”
within the meaning of Article 8 of the New York UCC and (ii) such Grantor shall
at no time elect to treat any such interest as a “security” within the meaning
of Article 8 of the New York UCC or issue any certificate representing such
interest, unless such Grantor provides prompt written notification to the
Collateral Agent of such election and promptly (but in no case later than 10
Business Days) pledges any such certificate to the Collateral Agent pursuant to
the terms hereof; provided, however, that this Section 3.04 shall not apply to
any Equity Interests in limited liability companies or limited partnerships
which may not be pledged, assigned or otherwise encumbered pursuant to
applicable Federal, state or local laws, rules or regulations related to the
practice of medicine or the healthcare industry generally.

 

Section 3.05. Registration in Nominee Name; Denominations. The Collateral Agent,
on behalf of the Secured Parties, shall have the right (in its sole and absolute
discretion) to hold the Pledged Securities in the name of the applicable
Grantor, endorsed or assigned in blank or in favor of the Collateral Agent or,
upon the occurrence and during the continuation of an Event of Default, in its
own name as pledge or the name of its nominee (as pledge or as sub-agent). Each
Grantor will promptly give to the Collateral Agent copies of any notices or
other communications received by it with respect to Pledged Securities
registered in the name of such Grantor. The Collateral Agent shall at all times
upon the occurrence and during the continuation of an Event of Default have the
right to exchange the certificates representing Pledged Securities for
certificates of smaller or larger denominations for any purpose consistent with
this Agreement.

 

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Section 3.06. Voting Rights; Dividends and Interest. (a) Unless and until an
Event of Default shall have occurred and be continuing and the Collateral Agent
shall have notified the Grantors that their rights under this Section 3.06 are
being suspended:

 

(i) Each Grantor shall be entitled to exercise any and all voting and other
consensual rights and powers inuring to an owner of Pledged Securities or any
part thereof for any purpose consistent with the terms in this Agreement, the
Credit Agreement and the other Loan Documents, provided that such rights and
powers shall not be exercised in any manner that would reasonably be expected to
materially and adversely affect the rights inuring to a holder of any Pledged
Securities or the rights and remedies of any of the Collateral Agent or the
other Secured Parties under this Agreement or the Credit Agreement or any other
Loan Document or the ability of the Secured Parties to exercise the same.

 

(ii) The Collateral Agent shall execute and deliver to each Grantor, or cause to
be executed and delivered to such Grantor, all such proxies, powers of attorney
and other instruments as such Grantor may reasonably request for the purpose of
enabling such Grantor to exercise the voting and other consensual rights and
powers it is entitled to exercise pursuant to subparagraph (i) above.

 

(iii) Each Grantor shall be entitled to receive and retain any and all
dividends, interest, principal and other distributions paid on or distributed in
respect of the Pledged Securities to the extent and only to the extent that such
dividends, interest, principal and other distributions are permitted by, and
otherwise paid or distributed in accordance with, the terms and conditions of
the Credit Agreement, the other Loan Documents and applicable laws, provided
that any noncash dividends, interest, principal or other distributions that
would constitute Pledged Stock or Pledged Debt Securities, whether resulting
from a subdivision, combination or reclassification of the outstanding Equity
Interests of the issuer of any Pledged Securities or received in exchange for
Pledged Securities or any part thereof, or in redemption thereof, or as a result
of any merger, consolidation, acquisition or other exchange of assets to which
such issuer may be a party or otherwise, shall be and become part of the Pledged
Collateral, and, if received by any Grantor, shall not be commingled by such
Grantor with any of its other funds or property but shall be held separate and
apart therefrom, shall be held in trust for the benefit of the Collateral Agent
and the other Secured Parties and shall be forthwith delivered to the Collateral
Agent in the same form as so received (with any necessary endorsement as
described in Section 3.03(c) or otherwise).

 

(b) Upon the occurrence and during the continuation of an Event of Default,
after the Collateral Agent shall have notified (or shall be deemed to have
notified) the Grantors of the suspension of their rights under
paragraph (a)(iii) of this Section 3.06, all rights of any Grantor to dividends,
interest, principal or other distributions that such Grantor is authorized to
receive pursuant to paragraph (a)(iii) of this Section 3.06 shall cease, and all
such rights shall thereupon become vested in the Collateral Agent, which shall
have the sole and exclusive right

 

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and authority to receive and retain such dividends, interest, principal or other
distributions. All dividends, interest, principal or other distributions
received by any Grantor contrary to the provisions of this Section 3.06 shall be
held in trust for the benefit of the Collateral Agent and the other Secured
Parties, shall be segregated from other property or funds of such Grantor and
shall be forthwith delivered to the Collateral Agent upon demand in the same
form as so received (with any necessary endorsement). Any and all money and
other property paid over to or received by the Collateral Agent pursuant to the
provisions of this paragraph (b) shall be retained by the Collateral Agent in an
account to be established by the Collateral Agent upon receipt of such money or
other property and shall be applied in accordance with the provisions of
Section 5.02. After all Events of Default have been cured or waived and the
Borrower has delivered to the Collateral Agent a certificate to that effect, the
Collateral Agent shall promptly repay to each Grantor (without interest) all
dividends, interest, principal or other distributions that such Grantor would
otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii) of
this Section 3.06 and that remain in such account.

 

(c) Upon the occurrence and during the continuation of an Event of Default,
after the Collateral Agent shall have notified (or shall be deemed to have
notified) the Grantors of the suspension of their rights under paragraph (a)(i)
of this Section 3.06, all rights of any Grantor to exercise the voting and other
consensual rights and powers it is entitled to exercise pursuant to
paragraph (a)(i) of this Section 3.06, and the obligations of the Collateral
Agent under paragraph (a)(ii) of this Section 3.06, shall cease, and all such
rights shall thereupon become vested in the Collateral Agent, which shall have
the sole and exclusive right and authority to exercise such voting and other
consensual rights and powers, provided that, unless otherwise directed by the
Required Lenders, the Collateral Agent shall have the right from time to time
following and during the continuation of an Event of Default to permit the
Grantors to exercise such rights. After all Events of Default have been cured or
waived, the Grantors shall have the right to exercise the voting and consensual
rights and powers that they would otherwise be entitled to exercise pursuant to
the terms of paragraph (a)(i) above.

 

(d) Any notice given by the Collateral Agent to the Grantors suspending their
rights under paragraph (a) of this Section 3.06 (i) may be given by telephone if
promptly confirmed in writing, (ii) may be given to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of the Grantors
under paragraph (a)(i) or paragraph (a)(iii) of this Section 3.06 in part
without suspending all such rights (as specified by the Collateral Agent in its
sole and absolute discretion) and without waiving or otherwise affecting the
Collateral Agent’s rights to give additional notices from time to time
suspending other rights so long as an Event of Default has occurred and is
continuing.

 

ARTICLE IV

 

Security Interests in Personal Property

 

Section 4.01. Security Interest. (a) As security for the payment or performance,
as applicable, in full of the Obligations, each Grantor hereby grants to the
Collateral Agent, its successors and assigns, for the ratable benefit of the
Secured Parties, a security interest (the “Security Interest”) in all right,
title or interest in or to any and all of the following assets and

 

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properties now owned or at any time hereafter acquired by such Grantor or in
which such Grantor now has or at any time in the future may acquire any right,
title or interest (collectively, the “Article 9 Collateral”):

 

(i) all Accounts;

 

(ii) all Chattel Paper;

 

(iii) all cash and Deposit Accounts;

 

(iv) all Documents;

 

(v) all Equipment;

 

(vi) all General Intangibles;

 

(vii) all Instruments;

 

(viii) all Inventory;

 

(ix) all Investment Property;

 

(x) all Letter-of-credit rights;

 

(xi) the commercial tort claims specified on Schedule IV;

 

(xii) all books and records pertaining to the Article 9 Collateral; and

 

(xiii) to the extent not otherwise included, all Proceeds and products of any
and all of the foregoing and all collateral security, supporting obligations and
guarantees given by any Person with respect to any of the foregoing.

 

Notwithstanding the foregoing, the Article 9 Collateral shall not include
(i) any Equipment that is subject to a purchase money lien or capital lease
permitted under the Credit Agreement to the extent the documents relating to
such purchase money lien or capital lease would not permit such Equipment to be
subject to the Security Interests created hereby and (ii) any property to the
extent that such grant of a security interest is prohibited by any Requirements
of Law of any Governmental Authority or constitutes a breach or default under or
results in termination of any contract, license, agreement, instrument or other
document evidencing or giving rise to such property or, in the case of any
Investment Property or Pledged Securities, any applicable shareholder or similar
agreement, except, in each case, to the extent that such Requirement of Law or
the provision of such contract, license, agreement instrument or other document
or shareholder or similar agreement giving rise to such prohibition, breach,
default or termination is ineffective under applicable law.

 

(b) Each Grantor hereby irrevocably authorizes the Collateral Agent at any time
and from time to time to file in any relevant jurisdiction any initial financing
statements (including fixture filings) with respect to the Article 9 Collateral
or any part thereof and

 

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amendments thereto that (i) indicate the Collateral as “all assets” of such
Grantor or such other description as the Collateral Agent may determine and
(ii) contain the information required by Article 9 of the Uniform Commercial
Code of each applicable jurisdiction for the filing of any financing statement
or amendment, including (A) whether such Grantor is an organization, the type of
organization and any organizational identification number issued to such Grantor
and (B) in the case of a financing statement filed as a fixture filing or
covering Article 9 Collateral constituting minerals or the like to be extracted
or timber to be cut, a sufficient description of the real property to which such
Article 9 Collateral relates. Each Grantor agrees to provide such information to
the Collateral Agent promptly upon request.

 

Each Grantor also ratifies its authorization for the Collateral Agent to file in
any relevant jurisdiction any initial financing statements (including fixture
filings, as applicable) or other appropriate filings, recordings or
registrations or amendments thereto if filed prior to the date hereof.

 

The Collateral Agent is further authorized to file with the United States Patent
and Trademark Office or United States Copyright Office (or any successor office
or any similar office in any other country) such documents as may be necessary
or advisable for the purpose of perfecting, confirming, continuing, enforcing or
protecting the Security Interest granted by each Grantor, without the signature
of any Grantor, and naming any Grantor or the Grantors as debtors and the
Collateral Agent as secured party.

 

(c) The Security Interest is granted as security only and shall not subject the
Collateral Agent or any other Secured Party to, or in any way alter or modify,
any obligation or liability of any Grantor with respect to or arising out of the
Article 9 Collateral.

 

Section 4.02. Representations and Warranties. The Grantors jointly and severally
represent and warrant to the Collateral Agent and the other Secured Parties
that:

 

(a) Each Grantor has good and valid rights in and title to the Article 9
Collateral and has full power and authority to grant to the Collateral Agent,
for the ratable benefit of the Secured Parties, the Security Interest in such
Article 9 Collateral pursuant hereto and to execute, deliver and perform its
obligations in accordance with the terms in this Agreement, without the consent
or approval of any other Person other than any consent or approval that has been
obtained.

 

(b) The Perfection Certificate has been duly prepared, completed and executed
and the information set forth therein, including (x) the exact legal name of
each Grantor and (y) the jurisdiction of organization of each Grantor, is
correct and complete in all material respects as of the Effective Date (except
that the information referred to in the preceding clauses (x) and (y) shall not
be subject to such materiality qualifier). The Uniform Commercial Code financing
statements (including fixture filings, as applicable) or other appropriate
filings, recordings or registrations prepared by the Collateral Agent based upon
the information provided to the Collateral Agent in the Perfection Certificate
for filing in each governmental, municipal or other office specified in
Schedule 2 to the Perfection Certificate (or specified by notice from the
Borrower to the Collateral Agent after the Effective Date in the case of
filings, recordings or registrations required by Section 5.03(a), 5.03(b) or
5.12 of the Credit Agreement), are all the

 

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filings, recordings and registrations (other than filings required to be made in
the United States Patent and Trademark Office and the United States Copyright
Office in order to perfect the Security Interest in Article 9 Collateral
consisting of United States Patents, United States registered Trademarks (and
Trademarks for which United States registration applications are pending) and
United States registered Copyrights) that are necessary to publish notice of and
protect the validity of and to establish a legal, valid and perfected security
interest in favor of the Collateral Agent, for the ratable benefit of the
Secured Parties, in respect of all Article 9 Collateral in which the Security
Interest may be perfected by filing, recording or registration in the United
States (or any political subdivision thereof) and its territories and
possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary in any such
jurisdiction, except as provided under applicable law with respect to the filing
of continuation statements. Each Grantor represents and warrants that a fully
executed agreement in the form hereof and containing a description of all
Article 9 Collateral consisting of Intellectual Property with respect to United
States Patents and United States registered Trademarks (and Trademarks for which
United States registration applications are pending) and United States
registered Copyrights have been delivered to the Collateral Agent for recording
by the United States Patent and Trademark Office and the United States Copyright
Office pursuant to 35 U.S.C. § 261, 15 U.S.C. § 1060 or 17 U.S.C. § 205 and the
regulations thereunder, as applicable, and otherwise as may be required pursuant
to the laws of any other necessary jurisdiction, to protect the validity of and
to establish a legal, valid and perfected security interest in favor of the
Collateral Agent, for the ratable benefit of the Secured Parties, in respect of
all Article 9 Collateral consisting of United States Patents, United States
registered Trademarks (and Trademarks for which United States registration
applications are pending) and United States registered Copyrights in which a
security interest may be perfected by filing, recording or registration in the
United States (or any political subdivision thereof) and its territories and
possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary (other than such
actions as are necessary to perfect the Security Interest with respect to any
Article 9 Collateral consisting of United States Patents, United States
registered Trademarks (and Trademarks for which United States registration
applications are pending) and United States registered Copyrights acquired or
developed after the date hereof).

 

(c) The Security Interest constitutes (i) a legal and valid security interest in
all the Article 9 Collateral securing the payment and performance of the
Obligations, (ii) subject to the filings described in Section 4.02(b), a
perfected security interest in all Article 9 Collateral in which a security
interest may be perfected by filing, recording or registering a financing
statement or analogous document in the United States (or any political
subdivision thereof) and its territories and possessions pursuant to the Uniform
Commercial Code or other applicable law in such jurisdictions and (iii) a
security interest that shall be perfected in all Article 9 Collateral in which a
security interest may be perfected upon the receipt and recording of this
Agreement with the United States Patent and Trademark Office and the United
States Copyright Office, as applicable, within the three-month period
(commencing as of the date hereof) pursuant to 35 U.S.C. § 261 or 15 U.S.C.
§ 1060 or the one-month period (commencing as of the date hereof) pursuant to
17 U.S.C. § 205 and otherwise as may be required pursuant to the laws of any
other necessary jurisdiction. The Security Interest is and shall be prior to any
other Lien on any of the Article 9 Collateral, other than Permitted Encumbrances
and Liens that are permitted by the Credit Agreement and that have priority as a
matter of applicable law.

 

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(d) The Article 9 Collateral is owned by the Grantors free and clear of any
Lien, except for Liens permitted pursuant to Section 6.02 of the Credit
Agreement. None of the Grantors has filed or consented to the filing of (i) any
financing statement or analogous document under the Uniform Commercial Code or
any other applicable laws covering any Article 9 Collateral, (ii) any assignment
in which any Grantor assigns any Collateral or any security agreement or similar
instrument covering any Article 9 Collateral with the United States Patent and
Trademark Office or the United States Copyright Office or (iii) any assignment
in which any Grantor assigns any Article 9 Collateral or any security agreement
or similar instrument covering any Article 9 Collateral with any foreign
governmental, municipal or other office, which financing statement or analogous
document, assignment, security agreement or similar instrument is still in
effect, except, in each case, for Liens permitted pursuant to Section 6.02 of
the Credit Agreement.

 

Section 4.03. Covenants. (a) Each Grantor agrees promptly (but in no case more
than 90 days) to notify the Collateral Agent in writing of any change (i) in its
legal name, (ii) in the location of its chief executive office or its principal
place of business, (iii) in its identity or type of organization or corporate
structure, (iv) in its Federal Taxpayer Identification Number or organizational
identification number or (v) in its jurisdiction of organization. Each Grantor
agrees to promptly provide the Collateral Agent with certified organizational
documents reflecting any of the changes described in the first sentence of this
Section 4.03(a). Each Grantor agrees not to effect or permit any change referred
to in the second preceding sentence unless all filings have been made under the
Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have a valid,
legal and perfected first priority security interest (subject to Liens permitted
under Section 6.02 of the Credit Agreement) in the Article 9 Collateral. Each
Grantor agrees promptly to notify the Collateral Agent if any portion of the
Article 9 Collateral material to a Grantor’s business owned or held by such
Grantor is damaged or destroyed.

 

(b) Each Grantor agrees to maintain, at its own cost and expense, such complete
and accurate records with respect to the Article 9 Collateral owned by it as is
consistent with its current practices and in accordance with such standard
practices used in industries that are the same as or similar to those in which
such Grantor is engaged, but in any event to include complete accounting records
indicating all payments and proceeds received with respect to any part of the
Article 9 Collateral, and, at such time or times as the Collateral Agent may
reasonably request, promptly to prepare and deliver to the Collateral Agent a
duly certified schedule or schedules in form and detail reasonably satisfactory
to the Collateral Agent showing the identity, amount and location of any and all
Article 9 Collateral.

 

(c) Each year, at the time of delivery of annual financial statements with
respect to the preceding fiscal year pursuant to Section 5.01(a) of the Credit
Agreement, the Borrower shall deliver to the Collateral Agent a certificate
executed by a Financial Officer of the Borrower setting forth the information
required pursuant to the Perfection Certificate or confirming that there has
been no material change in such information since the date of the Perfection
Certificate delivered on the Effective Date or the date of the most recent
certificate delivered pursuant to this Section 4.03(c). Each certificate
delivered pursuant to this Section 4.03(c) shall identify in the format of
Schedule III all Intellectual Property of any Grantor in existence on the date
thereof and not then listed on such Schedules or previously so identified to the
Collateral Agent.

 

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(d) Each Grantor shall, at its own expense, take any and all actions necessary
to defend title to the Article 9 Collateral (other than Article 9 Collateral
that is deemed by the board of directors of such Grantor to be immaterial to the
conduct of its business) against all Persons and to defend the Security Interest
of the Collateral Agent in the Article 9 Collateral and the priority thereof
against any Lien not expressly permitted pursuant to Section 6.02 of the Credit
Agreement. Nothing in this Agreement shall prevent any Grantor from
discontinuing the operation or maintenance of any of its assets or properties if
such discontinuance is (x) in the judgment of its board of directors, desirable
in the conduct of its business and (y) permitted by the Credit Agreement.

 

(e) Each Grantor agrees, at its own expense, to execute, acknowledge, deliver
and cause to be duly filed all such further instruments and documents and take
all such actions as the Collateral Agent may from time to time reasonably
request to better assure, preserve, protect and perfect the Security Interest
and the rights and remedies created hereby, including the payment of any fees
and taxes required in connection with the execution and delivery of this
Agreement, the granting of the Security Interest and the filing of any financing
statements (including fixture filings) or other documents (including execution
of agreements in the form of Exhibits IV, V and VI and filing such agreements
with the United States Patent and Trademark Office or United States Copyright
Office, as applicable) in connection herewith or therewith. If any amount
payable to any Grantor under or in connection with any of the Article 9
Collateral shall be or become evidenced by any promissory note or other
instrument in excess of $1,000,000 or by any promissory note or other instrument
in an amount that when taken together with any promissory note or other
instruments not previously pledged and endorsed to the Collateral Agent exceeds
$5,000,000, such note or instrument shall be promptly pledged and delivered to
the Collateral Agent, duly endorsed in a manner satisfactory to the Collateral
Agent.

 

(f) The Collateral Agent and such Persons as the Collateral Agent may reasonably
designate shall have the right, at the Grantors’ own cost and expense, to
inspect the Article 9 Collateral, all records related thereto (and to make
extracts and copies from such records) and the premises upon which any of the
Article 9 Collateral is located, to discuss the Grantors’ affairs with the
officers of the Grantors and their independent accountants and to verify under
reasonable procedures, in accordance with Section 5.09 of the Credit Agreement,
the validity, amount, quality, quantity, value, condition and status of, or any
other matter relating to, the Article 9 Collateral, including, (upon the
occurrence and during the continuation of a Default or with the consent of the
applicable Grantor (not to be unreasonably withheld)) in the case of Accounts or
other Article 9 Collateral in the possession of any third person, by contacting
Account Debtors or the third person possessing such Article 9 Collateral for the
purpose of making such a verification. Subject to Section 9.12 of the Credit
Agreement, the Collateral Agent shall have the absolute right to share any
information it gains from such inspection or verification with any Secured
Party.

 

(g) At its option, the Collateral Agent may discharge past due Taxes,
assessments, charges, fees or Liens at any time levied or placed on the
Article 9 Collateral and not permitted pursuant to Section 6.02 of the Credit
Agreement, and may pay for the

 

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maintenance and preservation of the Article 9 Collateral to the extent any
Grantor fails to do so as required by the Credit Agreement or this Agreement,
and each Grantor jointly and severally agrees to reimburse the Collateral Agent
on demand for any payment made or any expense incurred by the Collateral Agent
pursuant to the foregoing authorization, provided that nothing in this paragraph
shall be interpreted as excusing any Grantor from the performance of, or
imposing any obligation on the Collateral Agent or any Secured Party to cure or
perform, any covenants or other promises of any Grantor with respect to Taxes,
assessments, charges, fees, Liens and maintenance as set forth in this Agreement
or in the other Loan Documents.

 

(h) If at any time any Grantor shall take a security interest in any property of
an Account Debtor or any other Person with a value in excess of $1,000,000 or
with a value that when taken together with the value of any property of an
Account Debtor or any other Person not previously assigned to the Collateral
Agent exceeds $5,000,000, to secure payment and performance of an Account, such
Grantor shall promptly assign such security interest to the Collateral Agent.
Such assignment need not be filed of public record unless necessary to continue
the perfected status of the security interest against creditors of and
transferees from the Account Debtor or other Person granting the security
interest.

 

(i) Each Grantor shall remain liable to observe and perform all the conditions
and material obligations to be observed and performed by it under each contract,
agreement or instrument relating to the Article 9 Collateral, all in accordance
with the terms and conditions thereof, and each Grantor jointly and severally
agrees to indemnify and hold harmless the Collateral Agent and the other Secured
Parties from and against any and all liability for such performance.

 

(j) None of the Grantors shall make or permit to be made an assignment, pledge
or hypothecation of the Article 9 Collateral or shall grant any other Lien in
respect of the Article 9 Collateral, except as permitted by the Credit
Agreement. Subject to the immediately following sentence, none of the Grantors
shall make or permit to be made any transfer of the Article 9 Collateral and
each Grantor shall remain at all times in possession of the Article 9 Collateral
owned by it, except as permitted by Sections 6.02 and 6.05 of the Credit
Agreement. Without limiting the generality of the foregoing, each Grantor agrees
that it shall not permit any Inventory to be in the possession or control of any
warehouseman, agent, bailee, or processor at any time unless such Person shall
have been notified of the Security Interest and shall have acknowledged in
writing, in form and substance reasonably satisfactory to the Collateral Agent,
that such warehouseman, agent, bailee or processor holds the Inventory for the
benefit of the Collateral Agent subject to the Security Interest and shall act
upon the instructions of the Collateral Agent without further consent from the
Grantor, and that such warehouseman, agent, bailee or processor further agrees
to waive and release any Lien held by it with respect to such Inventory, whether
arising by operation of law or otherwise; provided that such notice and
acknowledgement shall not be required if the aggregate fair value of Inventory
in the possession of or subject to the control of such warehouseman, agent,
bailee or processor who has not been so notified and provided such
acknowledgement is less than $1,000,000 and the aggregate fair value of
Inventory in the possession of or subject to the control of all warehousemen,
agents, bailees and processors who have not been so notified and provided such
acknowledgement is less than $5,000,000.

 

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(k) None of the Grantors will, without the Collateral Agent’s prior written
consent, grant any extension of the time of payment of any Accounts included in
the Article 9 Collateral, compromise, compound or settle the same for less than
the full amount thereof, release, wholly or partly, any Person liable for the
payment thereof or allow any credit or discount whatsoever thereon, other than
compromises, compoundings, settlements and collections made in the ordinary
course of business or in accordance with the reasonable business judgment of
such Grantor.

 

(l) The Grantors, at their own expense, shall maintain or cause to be maintained
insurance covering physical loss or damage to the Inventory and Equipment in
accordance with the requirements set forth in Section 5.07 of the Credit
Agreement. Each Grantor irrevocably makes, constitutes and appoints the
Collateral Agent (and all officers, employees or agents designated by the
Collateral Agent) as such Grantor’s true and lawful agent (and attorney-in-fact)
for the purpose, upon the occurrence and during the continuation of an Event of
Default, of making, settling and adjusting claims in respect of Article 9
Collateral under policies of insurance, endorsing the name of such Grantor on
any check, draft, instrument or other item of payment for the proceeds of such
policies of insurance and for making all determinations and decisions with
respect thereto. In the event that any Grantor at any time or times shall fail
to obtain or maintain any of the policies of insurance required under the Credit
Agreement or to pay any premium in whole or part relating thereto, the
Collateral Agent may, without waiving or releasing any obligation or liability
of the Grantors hereunder or any Event of Default, in its sole reasonable
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other actions with respect thereto as the Collateral Agent deems
advisable. All sums disbursed by the Collateral Agent in connection with this
paragraph, including reasonable attorneys’ fees, court costs, out-of-pocket
expenses and other charges relating thereto, shall be payable, upon demand, by
the Grantors to the Collateral Agent and shall be additional Obligations secured
hereby.

 

(m) Each Grantor shall maintain, in form and manner reasonably satisfactory to
the Collateral Agent, records of its Chattel Paper and its books, records and
documents evidencing or pertaining thereto.

 

Section 4.04. Other Actions. In order to insure the attachment, perfection and
priority of, and the ability of the Collateral Agent to enforce, the Security
Interest, each Grantor agrees, in each case at such Grantor’s own expense, to
take the following actions with respect to the following Article 9 Collateral:

 

(a) Instruments and Tangible Chattel Paper. Each Grantor represents and warrants
that each Instrument and each item of Tangible Chattel Paper with a value in
excess of $1,000,000 in existence on the date hereof has been properly endorsed,
assigned and delivered to the Collateral Agent, accompanied by instruments of
transfer or assignment duly executed in blank. If any Grantor shall at any time
hold or acquire any Instruments or Chattel Paper with a value in excess of
$1,000,000 or any Instrument or Chattel Paper with a value that when taken
together with the value of any Instrument or Chattel Paper not previously
endorsed, assigned and delivered to the Collateral Agent exceeds $5,000,000,
such Grantor shall forthwith endorse, assign and deliver the same to the
Collateral Agent, accompanied by such undated instruments of transfer or
assignment duly executed in blank as the Collateral Agent may from time to time
reasonably request.

 

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(b) Electronic Chattel Paper and Transferable Records. If any Grantor at any
time holds or acquires an interest in any electronic chattel paper or any
“transferable record,” as that term is defined in Section 201 of the Federal
Electronic Signatures in Global and National Commerce Act, or in Section 16 of
the Uniform Electronic Transactions Act as in effect in any relevant
jurisdiction, such Grantor shall promptly notify the Collateral Agent thereof
and, at the request of the Collateral Agent, shall take such action as the
Collateral Agent may reasonably request to vest in the Collateral Agent control
under New York UCC Section 9-105 of such electronic chattel paper or control
under Section 201 of the Federal Electronic Signatures in Global and National
Commerce Act or, as applicable, Section 16 of the Uniform Electronic
Transactions Act, as in effect in such jurisdiction, of such transferable
record. The Collateral Agent agrees with such Grantor that the Collateral Agent
will arrange, pursuant to procedures reasonably satisfactory to the Collateral
Agent and so long as such procedures will not result in the Collateral Agent’s
loss of control, for the Grantor to make alterations to the electronic chattel
paper or transferable record permitted under UCC Section 9-105 or, as
applicable, Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or Section 16 of the Uniform Electronic Transactions Act
for a party in control to allow without loss of control, unless an Event of
Default has occurred and is continuing or would occur after taking into account
any action by such Grantor with respect to such electronic chattel paper or
transferable record.

 

(c) Letter-of-Credit Rights. If any Grantor is at any time a beneficiary under a
letter of credit now or hereafter issued in favor of such Grantor in an amount
in excess of $1,000,000 or in an amount that when taken together with the any
letter of credit not previously assigned or transferred to the Collateral Agent
in pursuant to clauses (i) or (ii) of this Section 4.04(c) exceeds $5,000,000,
such Grantor shall promptly notify the Collateral Agent thereof and, at the
request and option of the Collateral Agent, such Grantor shall, pursuant to an
agreement in form and substance reasonably satisfactory to the Collateral Agent,
either (i) arrange for the issuer and any confirmer of such letter of credit to
consent to an assignment to the Collateral Agent of the proceeds of any drawing
under such letter of credit or (ii) arrange for the Collateral Agent to become
the transferee beneficiary of such letter of credit, with the Collateral Agent
agreeing, in each case, that the proceeds of any drawing under such letter of
credit are to be paid to the applicable Grantor unless an Event of Default has
occurred or is continuing.

 

(d) Commercial Tort Claims. If any Grantor shall at any time hold or acquire a
commercial tort claim in an amount reasonably estimated to exceed $1,000,000 or
in an amount that when taken together with any commercial tort claim in which
the Collateral Agent has not previously been granted a security interest exceeds
$5,000,000, the Grantor shall promptly notify the Collateral Agent thereof in a
writing signed by such Grantor including a summary description of such claim and
grant to the Collateral Agent, for the ratable benefit of the Secured Parties,
in such writing a security interest therein and in the proceeds thereof, all
upon the terms of this Agreement, with such writing to be in form and substance
reasonably satisfactory to the Collateral Agent.

 

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Section 4.05. Covenants Regarding Patent, Trademark and Copyright Collateral.

 

(a) Each Grantor agrees that it will not do any act or omit to do any act (and
will exercise commercially reasonable efforts to prevent its licensees from
doing any act or omitting to do any act) whereby any Patent that is material to
the conduct of such Grantor’s business would become invalidated or dedicated to
the public, and agrees that it shall continue to mark any products covered by a
Patent with the relevant patent number as necessary and sufficient in its
reasonable judgment to establish and preserve its material rights under
applicable patent laws.

 

(b) Each Grantor (either itself or through its licensees or its sublicensees)
will, for each Trademark material to the conduct of such Grantor’s business,
(i) maintain such Trademark in full force free from any claim of abandonment or
invalidity for non-use, (ii) use commercially reasonable efforts to maintain the
quality of products and services offered under such Trademark, (iii) display
such Trademark with notice of Federal or foreign registration (or, if such
Trademark is unregistered, display such Trademark with notice as required for
unregistered Trademarks) to the extent necessary and sufficient to establish and
preserve its maximum rights under applicable law and (iv) not knowingly use or
knowingly permit the use of such Trademark in any violation of any third party
rights.

 

(c) Each Grantor (either itself or through its licensees or sublicensees) will,
for each work covered by a Copyright material to the conduct of such Grantor’s
business, continue to publish, reproduce, display, adopt and distribute the work
with appropriate copyright notice as necessary and sufficient in its reasonable
judgment to establish and preserve its material rights under applicable
copyright laws.

 

(d) Each Grantor shall notify the Collateral Agent promptly if it knows that any
Patent, Trademark or Copyright material to the conduct of its business could
reasonably be expected to become abandoned, lost or dedicated to the public, or
of any materially adverse determination or development (including the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office, United States Copyright Office or
any court or similar office of any country) regarding such Grantor’s ownership
of any Patent, Trademark or Copyright, its right to register the same, or its
right to keep and maintain the same.

 

(e) In no event shall any Grantor, either itself or through any agent, employee,
licensee or designee, file an application with respect to any Patent, Trademark
or Copyright (or for the registration of any Trademark or Copyright) with the
United States Patent and Trademark Office, United States Copyright Office or any
office or agency in any political subdivision of the United States or in any
other country or any political subdivision thereof, unless it promptly informs
the Collateral Agent and, upon request of the Collateral Agent, executes and
delivers any and all agreements, instruments, documents and papers as the
Collateral Agent may reasonably request to evidence the Collateral Agent’s
security interest in such Patent, Trademark or Copyright, and each Grantor
hereby appoints the Collateral Agent as its attorney-in-fact to execute and file
such writings as are reasonably necessary for the foregoing purposes, all acts
of such attorney being hereby ratified and confirmed; such power, being coupled
with an interest, is irrevocable.

 

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(f) Each Grantor will take all reasonably necessary steps that are consistent
with the practice in any proceeding before the United States Patent and
Trademark Office, United States Copyright Office or any office or agency in any
political subdivision of the United States or in any other country or any
political subdivision thereof, to maintain and pursue each registration or
application that is material to the conduct of such Grantor’s business relating
to the Patents, Trademarks and/or Copyrights (and to obtain the relevant grant
or registration) and to maintain each issued Patent and each registration of the
Trademarks and Copyrights that is material to the conduct of any Grantor’s
business, including timely filings of applications for renewal, affidavits of
use, affidavits of incontestability and payment of maintenance fees, and, if
consistent with good business judgment, to initiate opposition, interference and
cancellation proceedings against third parties.

 

(g) In the event that any Grantor knows that any Article 9 Collateral consisting
of a Patent, Trademark or Copyright material to the conduct of any Grantor’s
business has been or is about to be infringed, misappropriated or diluted by a
third party, such Grantor promptly shall notify the Collateral Agent and shall,
if consistent with good business judgment, promptly sue for infringement,
misappropriation or dilution and to recover any and all damages for such
infringement, misappropriation or dilution (and take any actions required by
applicable law prior to instituting such suit), and take such other actions as
are appropriate under the circumstances to protect such Article 9 Collateral.
Nothing in this Agreement shall prevent any Grantor from discontinuing the use
or maintenance of any Article 9 Collateral consisting of a Patent, Trademark or
Copyright, or require any Grantor to pursue any claim of infringement,
misappropriation or dilution, if (x) such Grantor so determines in its good
business judgment and (y) it is not prohibited by the Credit Agreement.

 

(h) Upon and during the continuation of an Event of Default, each Grantor shall,
at the request of the Collateral Agent, use its commercially reasonable efforts
to obtain all requisite consents or approvals by the licensor of each Copyright
License, Patent License or Trademark License to effect the assignment of all
such Grantor’s right, title and interest thereunder to the Collateral Agent or
its designee.

 

Section 4.06. Cash Management System, Securities Accounts and Commodity
Accounts.

 

(a) Deposit Accounts. As of the date hereof (i) each Grantor has neither opened
nor maintains any Deposit Accounts other than the accounts listed on Schedule V
and (ii) each of the Deposit Accounts that is designated on such Schedule V as a
controlled account is subject to the terms of a Deposit Account Control
Agreement. No Grantor shall hereafter establish and maintain any Deposit Account
unless (1) the applicable Grantor shall have given the Collateral Agent 30 days’
prior written notice of its intention to establish such new Deposit Account with
a Bank, (2) such Bank shall be reasonably acceptable to the Collateral Agent and
(3) such Bank and such Grantor shall have duly executed and delivered to the
Collateral Agent a Deposit Account Control Agreement with respect to such
Deposit Account. The Collateral Agent agrees with each Grantor that the
Collateral Agent shall not give any instructions directing the disposition of
funds from time to time credited to any Deposit Account or withhold any
withdrawal rights from such Grantor with respect to funds from time to time
credited to any Deposit Account except upon the occurrence and during the
continuation of an Event of Default. No Grantor shall grant Control of any
Deposit Account to any person other than the Collateral Agent.

 

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(b) Securities Accounts and Commodity Accounts. As of the date hereof each
Grantor has no Securities Accounts or Commodity Accounts other than those listed
in Schedule V and the Collateral Agent has a perfected first priority security
interest in such Securities Accounts and Commodity Accounts by Control. No
Grantor shall hereafter establish and maintain any Securities Account or
Commodity Account with any Securities Intermediary or Commodity Intermediary
unless (1) the applicable Grantor shall have given the Collateral Agent 30 days’
prior written notice of its intention to establish such new Securities Account
or Commodity Account with such Securities Intermediary or Commodity
Intermediary, (2) such Securities Intermediary or Commodity Intermediary shall
be reasonably acceptable to the Collateral Agent and (3) such Securities
Intermediary or Commodity Intermediary, as the case may be, and such Grantor
shall have duly executed and delivered a Control Agreement with respect to such
Securities Account or Commodity Account, as the case may be. Each Grantor shall
accept any cash and Investment Property in trust for the benefit of the
Collateral Agent and within one (1) Business Day of actual receipt thereof,
deposit any and all cash and Investment Property (other than any Investment
Property pledged pursuant to Section 3.02 received by it) into a Deposit Account
or Securities Account subject to Collateral Agent’s Control. The Collateral
Agent agrees with each Grantor that the Collateral Agent shall not give any
Entitlement Orders or instructions or directions to any issuer of uncertificated
securities, Securities Intermediary or Commodity Intermediary, and shall not
withhold its consent to the exercise of any withdrawal or dealing rights by such
Grantor, unless an Event of Default has occurred and is continuing or, after
giving effect to any such investment and withdrawal rights, would occur. No
Grantor shall grant control over any Investment Property to any person other
than the Collateral Agent.

 

(c) The provisions of this Section 4.06 shall not apply to (x) any Excluded
Accounts or (y) any other Deposit Accounts (including Medicare Deposit
Accounts), Securities Accounts or Commodities Accounts opened or maintained by
the Grantors (such accounts, “Non-Excluded Accounts”) to the extent that the
aggregate average available daily balance over the immediately preceding
12-month period for all such Non-Excluded Accounts shall not at any time exceed
$3,000,000; provided that to the extent such balance exceeds $3,000,000, the
Grantors agree to promptly (but in no case longer than the greater of (i) 60
days or (ii) such longer period as agreed to by the Collateral Agent in its
reasonable judgment) grant Control over certain Non-Excluded Accounts not
covered by Control Agreements, as selected by the Grantors, such that
immediately after implementing Control Agreements, such balance as recalculated
shall not exceed $3,000,000. For purposes of this clause (c), “Excluded
Accounts” includes (A) the LC Account or any Deposit Account for which the
Collateral Agent is the Bank, (B) any Securities Account or Commodities Account
for which the Collateral Agent is the Securities Intermediary or the Commodity
Intermediary, respectively, (C) any Deposit Account maintained solely for
payroll purposes or holding solely restricted cash in connection with
self-insurance programs, (D) Deposit Accounts, Securities Accounts and
Commodities Accounts that are subject to Control Agreements and (E) during a
six-month period following any Permitted Acquisition, any Deposit Accounts,
Securities Accounts and Commodities Accounts acquired by a Grantor in connection
with such Permitted Acquisition.

 

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ARTICLE V

 

Remedies

 

Section 5.01. Remedies upon Default. Upon the occurrence and during the
continuation of an Event of Default, each Grantor agrees to deliver each item of
Collateral to the Collateral Agent on demand, and it is agreed that the
Collateral Agent shall have the right to take any of or all the following
actions at the same or different times: (a) with respect to any Article 9
Collateral consisting of Intellectual Property, on demand, to cause the Security
Interest to become an assignment, transfer and conveyance of any of or all such
Article 9 Collateral by the applicable Grantors to the Collateral Agent, for the
ratable benefit of the Secured Parties, or to license or sublicense, whether
general, special or otherwise, and whether on an exclusive or nonexclusive
basis, any such Article 9 Collateral throughout the world on such terms and
conditions and in such manner as the Collateral Agent shall determine (other
than in violation of any then-existing licensing arrangements to the extent that
waivers cannot be obtained), and (b) with or without legal process and with or
without prior notice or demand for performance, to take possession of the
Article 9 Collateral and without liability for trespass to enter any premises
where the Article 9 Collateral may be located for the purpose of taking
possession of or removing the Article 9 Collateral and, generally, to exercise
any and all rights afforded to a secured party under the Uniform Commercial Code
or other applicable law. Without limiting the generality of the foregoing, each
Grantor agrees that the Collateral Agent shall have the right, subject to the
mandatory requirements of applicable law, to sell or otherwise dispose of all or
any part of the Collateral at a public or private sale or at any broker’s board
or on any securities exchange, for cash, upon credit or for future delivery as
the Collateral Agent shall deem appropriate. Each such purchaser at any sale of
Collateral shall hold the property sold absolutely, free from any claim or right
on the part of any Grantor, and each Grantor hereby waives (to the extent
permitted by law) all rights of redemption, stay and appraisal that such Grantor
now has or may at any time in the future have under any rule of law or statute
now existing or hereafter enacted.

 

The Collateral Agent shall give the applicable Grantors 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other jurisdictions) of
the Collateral Agent’s intention to make any sale of Collateral. Such notice, in
the case of a public sale, shall state the time and place for such sale and, in
the case of a sale at a broker’s board or on a securities exchange, shall state
the board or exchange at which such sale is to be made and the day on which the
Collateral, or portion thereof, will first be offered for sale at such board or
exchange. 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 and state in the notice (if any) of such sale. At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an entirety
or in separate parcels, as the Collateral Agent may determine in its sole and
absolute discretion. The Collateral Agent shall not be obligated to make any
sale of any Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Collateral shall have been given. 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 sale, and such sale may, without further notice,
be made at the time and place to which the same was so

 

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adjourned. In case any sale of all or any part of the Collateral is made on
credit or for future delivery, the Collateral so sold may be retained by the
Collateral Agent until the sale price is paid by the purchaser or purchasers
thereof, but the Collateral Agent and the other Secured Parties shall not incur
any liability in case any such purchaser or purchasers shall fail to take up and
pay for the Collateral so sold and, in case of any such failure, such Collateral
may be sold again upon like notice. At any public (or, to the extent permitted
by law, private) sale made pursuant to this Agreement, any Secured Party may bid
for or purchase, free (to the extent permitted by law) from any right of
redemption, stay, valuation or appraisal on the part of any Grantor (all said
rights being also hereby waived and released to the extent permitted by law),
the Collateral or any part thereof offered for sale and may make payment on
account thereof by using any claim then due and payable to such Secured Party
from any Grantor as a credit against the purchase price, and such Secured Party
may, upon compliance with the terms of sale, hold, retain and dispose of such
property without further accountability to any Grantor therefor. For purposes
hereof, a written agreement to purchase the Collateral or any portion thereof
shall be treated as a sale thereof; the Collateral Agent shall be free to carry
out such sale pursuant to such agreement and no Grantor shall be entitled to the
return of the Collateral or any portion thereof subject thereto, notwithstanding
the fact that after the Collateral Agent shall have entered into such an
agreement, all Events of Default shall have been remedied and the Obligations
paid in full. As an alternative to exercising the power of sale herein conferred
upon it, the Collateral Agent may proceed by a suit or suits at law or in equity
to foreclose this Agreement and to sell the Collateral or any portion thereof
pursuant to a judgment or decree of a court or courts having competent
jurisdiction or pursuant to a proceeding by a court-appointed receiver. Any sale
pursuant to the provisions of this Section 5.01 shall be deemed to conform to
the commercially reasonable standards as provided in Section 9-610(b) of the
New York UCC or its equivalent in other jurisdictions.

 

Section 5.02. Application of Proceeds. The Collateral Agent shall apply the
proceeds of any collection or sale of Collateral pursuant to this Article V,
including any Collateral consisting of cash, as follows:

 

FIRST, to the payment of all costs and expenses incurred by the Collateral Agent
and the Administrative Agent in connection with such collection or sale or
otherwise in connection with this Agreement, any other Loan Document or any of
the Obligations, including all court costs and the fees and expenses of its
agents and legal counsel, the repayment of all advances made by the Collateral
Agent hereunder or under any other Loan Document on behalf of any Grantor and
any other costs or expenses incurred in connection with the exercise of any
right or remedy hereunder or under any other Loan Document;

 

SECOND, to the payment in full of the Obligations (the amounts so applied to be
distributed among the Secured Parties pro rata in accordance with the amounts of
the Obligations owed to them on the date of any such distribution); and

 

THIRD, to the Grantors, their successors or assigns, or as a court of competent
jurisdiction may otherwise direct.

 

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The Collateral Agent shall have sole and absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement. Upon any sale of Collateral by the Collateral Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Collateral Agent or of the officer making the sale shall be a
sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Collateral Agent
or such officer or be answerable in any way for the misapplication thereof.

 

Section 5.03. Grant of License To Use Intellectual Property. For the purpose of
enabling the Collateral Agent to exercise rights and remedies under this
Agreement at such time as the Collateral Agent shall be lawfully entitled to
exercise such rights and remedies, each Grantor hereby grants to the Collateral
Agent an irrevocable, nonexclusive license (exercisable without payment of
royalty or other compensation to the Grantors) to use, license or sublicense any
of the Article 9 Collateral consisting of Intellectual Property now owned or
hereafter acquired by such Grantor, and wherever the same may be located, and
including in such license reasonable access to all media in which any of the
licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof. The use of such license
by the Collateral Agent shall be exercised, at the option of the Collateral
Agent, only upon the occurrence and during the continuation of an Event of
Default, provided that any license, sublicense or other transaction entered into
by the Collateral Agent in accordance herewith shall be binding upon the
Grantors notwithstanding any subsequent cure of an Event of Default.

 

Section 5.04. Securities Act. In view of the position of the Grantors in
relation to the Pledged Collateral, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the “Federal Securities Laws”) with respect to any
disposition of the Pledged Collateral permitted hereunder. Each Grantor
understands that compliance with the Federal Securities Laws might very strictly
limit the course of conduct of the Collateral Agent if the Collateral Agent were
to attempt to dispose of all or any part of the Pledged Collateral, and might
also limit the extent to which or the manner in which any subsequent transferee
of any Pledged Collateral could dispose of the same. Similarly, there may be
other legal restrictions or limitations affecting the Collateral Agent in any
attempt to dispose of all or part of the Pledged Collateral under applicable
Blue Sky or other state securities laws or similar laws analogous in purpose or
effect. Each Grantor recognizes that in light of such restrictions and
limitations the Collateral Agent may, with respect to any sale of the Pledged
Collateral, limit the purchasers to those who will agree, among other things, to
acquire such Pledged Collateral for their own account, for investment, and not
with a view to the distribution or resale thereof. Each Grantor acknowledges and
agrees that in light of such restrictions and limitations, the Collateral Agent,
in its sole and absolute discretion (a) may proceed to make such a sale whether
or not a registration statement for the purpose of registering such Pledged
Collateral or part thereof shall have been filed under the Federal Securities
Laws and (b) may approach and negotiate with a single potential purchaser to
effect such sale. Each Grantor acknowledges and agrees that any such sale might
result in prices and other terms less favorable to the seller than if such sale
were a public sale without such restrictions. In the event of any such sale, the

 

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Collateral Agent shall incur no responsibility or liability for selling all or
any part of the Pledged Collateral at a price that the Collateral Agent, in its
sole and absolute discretion, may in good faith deem reasonable under the
circumstances, notwithstanding the possibility that a substantially higher price
might have been realized if the sale were deferred until after registration as
aforesaid or if more than a single purchaser were approached. The provisions of
this Section 5.04 will apply notwithstanding the existence of a public or
private market upon which the quotations or sales prices may exceed
substantially the price at which the Collateral Agent sells.

 

Section 5.05. Medicare/Medicaid. The parties hereto understand and agree that
the exercise of remedies hereunder with respect to receivables from Medicare or
Medicaid may be subject to applicable federal laws.

 

ARTICLE VI

 

Indemnity, Subrogation and Subordination

 

Section 6.01. Indemnity and Subrogation. In addition to all such rights of
indemnity and subrogation as the Guarantors may have under applicable law (but
subject to Section 6.03), the Borrower agrees that (a) in the event a payment of
any Obligation shall be made by any Guarantor under this Agreement, the Borrower
shall indemnify such Guarantor for the full amount of such payment and such
Guarantor shall be subrogated to the rights of the Person to whom such payment
shall have been made to the extent of such payment and (b) in the event any
assets of any Grantor shall be sold pursuant to this Agreement or any other
Security Document to satisfy in whole or in part any Obligation owed to any
Secured Party, the Borrower shall indemnify such Grantor in an amount equal to
the fair value of the assets so sold.

 

Section 6.02. Contribution and Subrogation. Each Guarantor and Grantor (a
“Contributing Party”) agrees (subject to Section 6.03) that, in the event a
payment shall be made by any other Guarantor hereunder in respect of any
Obligation or assets of any other Grantor shall be sold pursuant to any Security
Document to satisfy any Obligation owed to any Secured Party and such other
Guarantor or Grantor (the “Claiming Party”) shall not have been fully
indemnified by the Borrower as provided in Section 6.01, the Contributing Party
shall indemnify the Claiming Party in an amount equal to the amount of such
payment or the greater of the book value or the fair value of such assets, as
applicable, in each case multiplied by a fraction of which the numerator shall
be the net worth of the Contributing Party on the date hereof and the
denominator shall be the aggregate net worth of all the Guarantors and Grantors
on the date hereof (or, in the case of any Guarantor or Grantor becoming a party
hereto pursuant to Section 7.14, the date of the supplement hereto executed and
delivered by such Guarantor or Grantor). Any Contributing Party making any
payment to a Claiming Party pursuant to this Section 6.02 shall be subrogated to
the rights of such Claiming Party under Section 6.01 to the extent of such
payment.

 

Section 6.03. Subordination. Notwithstanding any provision in this Agreement to
the contrary, all rights of the Guarantors and Grantors under Sections 6.01 and
6.02 and all other rights of indemnity, contribution or subrogation under
applicable law or otherwise shall be

 

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fully subordinated to the indefeasible payment in full in cash of the
Obligations. No failure on the part of the Borrower or any Guarantor or Grantor
to make the payments required by Sections 6.01 and 6.02 (or any other payments
required under applicable law or otherwise) shall in any respect limit the
obligations and liabilities of any Guarantor or Grantor with respect to its
Obligations hereunder, and each Guarantor and Grantor shall remain liable for
the full amount of the Obligations of such Guarantor or Grantor hereunder.

 

ARTICLE VII

 

Miscellaneous

 

Section 7.01. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted in this Agreement) be in writing and given as
provided in Section 9.01 of the Credit Agreement, provided that any
communication or notice hereunder from the Collateral Agent to any Loan Party
upon the occurrence and during the continuation of an Event of Default may be
given by telephone if promptly confirmed in writing. All communications and
notices hereunder to any Subsidiary Loan Party shall be given to it in care of
the Borrower as provided in Section 9.01 of the Credit Agreement.

 

Section 7.02. Waivers; Amendment. i) No failure or delay by any Secured Party in
exercising any right or power hereunder or under any other Loan Document shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right or power, or any abandonment or discontinuance of steps to enforce
such a right or power, preclude any other or further exercise thereof or the
exercise of any other right or power. The rights and remedies of the Secured
Parties hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver of
any provision in this Agreement or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section 7.02, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
Without limiting the generality of the foregoing, the making of a Loan or
issuance of a Letter of Credit shall not be construed as a waiver of any
Default, regardless of whether any Secured Party may have had notice or
knowledge of such Default at the time. No notice or demand on any Loan Party in
any case shall entitle any Loan Party to any other or further notice or demand
in similar or other circumstances.

 

(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Collateral Agent and the Loan Party or Loan Parties with respect to which
such waiver, amendment or modification is to apply, subject to any consent
required in accordance with Section 9.02 of the Credit Agreement.

 

Section 7.03. Collateral Agent’s Fees and Expenses; Indemnification. (a) The
parties hereto agree that the Collateral Agent shall be entitled to
reimbursement of its reasonable out-of-pocket expenses incurred hereunder as
provided in Section 9.03 of the Credit Agreement.

 

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(b) Without limitation of its indemnification obligations under the other Loan
Documents, each Grantor and each Guarantor jointly and severally agrees to
indemnify the Collateral Agent and the other Indemnitees (as defined in
Section 9.03 of the Credit Agreement) against, and hold each Indemnitee harmless
from, any and all losses, claims, damages, liabilities and related out-of-pocket
expenses, including the fees, charges and disbursements of any counsel for any
Indemnitee, incurred by or asserted against any Indemnitee arising out of, in
connection with, or as a result of, the execution, delivery or performance of
this Agreement or any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing agreements or instruments
contemplated hereby, or to the Collateral, whether or not any Indemnitee is a
party thereto, provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or
related out-of-pocket expenses are determined by a court of competent
jurisdiction to have resulted from the gross negligence or wilful misconduct of
such Indemnitee or any of its Related Parties.

 

(c) Any such amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 7.03 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Loan Document, the
consummation of the transactions contemplated hereby, the repayment of any of
the Obligations, the invalidity or unenforceability of any term or provision of
this Agreement or any other Loan Document, or any investigation made by or on
behalf of the Collateral Agent or any other Secured Party. All amounts due under
this Section 7.03 shall be payable on written demand therefor.

 

Section 7.04. Successors and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Guarantor, Grantor or the Collateral Agent
that are contained in this Agreement shall bind and inure to the benefit of
their respective successors and assigns and shall inure to the benefit of the
other Secured Parties and their respective successors and assigns.

 

Section 7.05. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Loan Document shall be considered to
have been relied upon by the Lenders and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any Lender or on its
behalf and notwithstanding that the Administrative Agent, the Collateral Agent,
the Issuing Bank or any Lender may have had notice or knowledge of any Default
or incorrect representation or warranty at the time any credit is extended under
the Credit Agreement, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other amount
payable under any Loan Document is outstanding and unpaid or any Letter of
Credit is outstanding and so long as the Commitments have not expired or
terminated.

 

Section 7.06. Counterparts; Effectiveness; Several Agreement. This Agreement may
be executed in counterparts, each of which shall constitute an original but all
of which, when taken together, shall constitute single contract. Delivery of an
executed signature page to

 

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this Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement. This Agreement shall become
effective as to any Loan Party when a counterpart hereof executed on behalf of
such Loan Party shall have been delivered to the Collateral Agent and a
counterpart hereof shall have been executed on behalf of the Collateral Agent,
and thereafter shall be binding upon such Loan Party and the Collateral Agent
and their respective permitted successors and assigns, and shall inure to the
benefit of such Loan Party, the Administrative Agent, the Collateral Agent and
the other Secured Parties and their respective successors and assigns, except
that no Loan Party shall have the right to assign or transfer its rights or
obligations hereunder or any interest in this Agreement or in the Collateral
(and any such assignment or transfer shall be void) except as contemplated by
this Agreement or the Credit Agreement. This Agreement shall be construed as a
separate agreement with respect to each Loan Party and may be amended, modified,
supplemented, waived or released with respect to any Loan Party without the
approval of any other Loan Party and without affecting the obligations of any
other Loan Party hereunder.

 

Section 7.07. Severability. Any provision in this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction. The
parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

 

Section 7.08. Right of Set-Off. If an Event of Default shall have occurred and
be continuing, each Lender and each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by such Lender or Affiliate to or for the credit or the account of any Loan
Party against any of and all the obligations of such Loan Party now or hereafter
existing under this Agreement owed to such Lender, irrespective of whether or
not such Lender shall have made any demand under this Agreement and although
such obligations may be unmatured. The applicable Lender shall notify the
Borrower, the Collateral Agent and the Administrative Agent of such set-off or
application, provided that any failure to give or any delay in giving such
notice shall not affect the validity of any such set-off or application under
this Section 7.08. The rights of each Lender under this Section 7.08 are in
addition to other rights and remedies (including other rights of set-off) which
such Lender may have.

 

Section 7.09. Governing Law; Jurisdiction; Consent to Service of Process.

 

(a) This Agreement shall be construed in accordance with and governed by the law
of the State of New York.

 

(b) Each of the parties hereto hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of the Supreme
Court of the State of New York sitting in New York County and of the United
States District Court of the Southern District of New York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Agreement or any other Loan

 

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Document, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in such
New York State or, to the extent permitted by law, in such Federal court. Each
of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement or any other Loan Document shall affect any right that the Collateral
Agent, the Issuing Bank, any Lender or any Loan Party may otherwise have to
bring any action or proceeding relating to this Agreement or any other Loan
Document in the courts of any jurisdiction.

 

(c) Each of the Loan Parties hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Loan
Document in any court referred to in paragraph (b) of this Section 7.09. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

 

(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 7.01. Nothing in this Agreement or
any other Loan Document will affect the right of any party to this Agreement to
serve process in any other manner permitted by law.

 

Section 7.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 7.10.

 

Section 7.11. Headings. Article and Section headings and the Table of Contents
used in this Agreement are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

 

Section 7.12. Security Interest Absolute. All rights of the Collateral Agent
hereunder, the Security Interest, the grant of a security interest in the
Pledged Collateral and all obligations of each Grantor and Guarantor hereunder
shall be absolute and unconditional irrespective of (a) any lack of validity or
enforceability of the Credit Agreement, any other Loan

 

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Document, any agreement with respect to any of the Obligations or any other
agreement or instrument relating to any of the foregoing, (b) any change in the
time, manner or place of payment of, or in any other term of, all or any of the
Obligations, or any other amendment or waiver of or any consent to any departure
from the Credit Agreement, any other Loan Document or any other agreement or
instrument, (c) any exchange, release or non-perfection of any Lien on other
collateral, or any release or amendment or waiver of or consent under or
departure from any guarantee, securing or guaranteeing all or any of the
Obligations, or (d) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, any Grantor or Guarantor in respect of
the Obligations or this Agreement.

 

Section 7.13. Termination or Release. (a) This Agreement and the Guarantees made
in this Agreement shall terminate and the Security Interest and all other
security interests granted hereby shall be automatically released when all the
Loan Document Obligations (other than wholly contingent indemnification
obligations not then due) have been indefeasibly paid in full and the Lenders
have no further commitment to lend under the Credit Agreement, the LC Exposure
has been reduced to zero and the Issuing Bank has no further obligations to
issue Letters of Credit under the Credit Agreement.

 

(b) A Person which was a Loan Party immediately prior to the consummation of any
transaction permitted by the Credit Agreement shall automatically be released
from its obligations hereunder and the Security Interest in the Collateral of
such Person shall be automatically released upon the consummation of any
transaction permitted by the Credit Agreement as a result of which such Person
ceases to be a Loan Party.

 

(c) Upon any sale or other transfer by any Grantor of any Collateral that is
permitted under the Credit Agreement, or upon the effectiveness of any written
consent to the release of the security interest granted hereby in any Collateral
pursuant to Section 9.02 of the Credit Agreement, the security interest in such
Collateral shall be automatically released.

 

(d) In connection with any termination or release pursuant to paragraph (a),
(b) or (c) of this Section 7.13, the Collateral Agent shall execute and deliver
to any Person, at such Person’s expense, all documents that such Person shall
reasonably request to evidence such termination or release of its obligations or
the Security Interests in its Collateral. Any execution and delivery of
documents pursuant to this Section 7.13 shall be without recourse to or warranty
by the Collateral Agent. Without limiting the provisions of Section 7.03, the
Borrower shall reimburse the Collateral Agent upon demand for all reasonable
costs and out of pocket expenses, including the reasonable fees, charges and
disbursements of counsel, incurred by it in connection with any action
contemplated by this Section 7.13.

 

Section 7.14. Additional Subsidiaries. Pursuant to Section 5.12 of the Credit
Agreement, each Subsidiary of a Loan Party (other than a Consolidated Practice)
that was not in existence or not a Subsidiary on the date of the Credit
Agreement and is not (x) an Inactive Subsidiary (other than an Inactive
Subsidiary that has satisfied the Collateral and Guarantee Requirement) or (y) a
Permitted Joint Venture (other than a Permitted Joint Venture Loan Party) is
required to enter in this Agreement as a Subsidiary Loan Party upon becoming
such a Subsidiary. Upon execution and delivery by the Collateral Agent and a
Subsidiary of an instrument in the form of Exhibit I hereto, such Subsidiary
shall become a Subsidiary Loan Party

 

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hereunder with the same force and effect as if originally named as a Subsidiary
Loan Party in this Agreement. The execution and delivery of any such instrument
shall not require the consent of any other Loan Party hereunder. The rights and
obligations of each Loan Party hereunder shall remain in full force and effect
notwithstanding the addition of any new Loan Party as a party to this Agreement.

 

Section 7.15. Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby
appoints the Collateral Agent the attorney-in-fact of such Grantor for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that the Collateral Agent may deem necessary or
advisable to accomplish the purposes hereof, which appointment is irrevocable
and coupled with an interest. Without limiting the generality of the foregoing,
the Collateral Agent shall have the right, upon the occurrence and during the
continuation of an Event of Default, with full power of substitution either in
the Collateral Agent’s name or in the name of such Grantor(except to the extent
such action would be prohibited by applicable law with respect to Medicare and
Medicaid receivables) (a) to receive, endorse, assign and/or deliver any and all
notes, acceptances, checks, drafts, money orders or other evidences of payment
relating to the Collateral or any part thereof; (b) to demand, collect, receive
payment of, give receipt for and give discharges and releases of all or any of
the Collateral; (c) to sign the name of any Grantor on any invoice or bill of
lading relating to any of the Collateral; (d) to send verifications of Accounts
Receivable to any Account Debtor; (e) to commence and prosecute any and all
suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Collateral or
to enforce any rights in respect of any Collateral; (f) to settle, compromise,
compound, adjust or defend any actions, suits or proceedings relating to all or
any of the Collateral; (g) to notify, or to require any Grantor to notify,
Account Debtors to make payment directly to the Collateral Agent; and (h) to
use, sell, assign, transfer, pledge, make any agreement with respect to or
otherwise deal with all or any of the Collateral, and to do all other acts and
things necessary to carry out the purposes of this Agreement, as fully and
completely as though the Collateral Agent were the absolute owner of the
Collateral for all purposes, provided that nothing in this Agreement contained
shall be construed as requiring or obligating the Collateral Agent to make any
commitment or to make any inquiry as to the nature or sufficiency of any payment
received by the Collateral Agent, or to present or file any claim or notice, or
to take any action with respect to the Collateral or any part thereof or the
moneys due or to become due in respect thereof or any property covered thereby.
The Collateral Agent and the other Secured Parties shall be accountable only for
amounts actually received as a result of the exercise of the powers granted to
them in this Agreement, and neither they nor their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or wilful misconduct.

 

Section 7.16. Further Assurances. Notwithstanding anything to the contrary
herein, the parties hereto agree to comply with the requirements set forth in
Section 5.13 of the Credit Agreement.

 

[Signature Pages to Follow]

 

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

 

AMERIPATH HOLDINGS INC., By:  

/s/ David L. Redmond

--------------------------------------------------------------------------------

Name:   David L. Redmond Title:   Executive Vice President AMERIPATH, INC., By:
 

/s/ David L. Redmond

--------------------------------------------------------------------------------

Name:   David L. Redmond Title:   Executive Vice President

 

Signature Page to Collateral Agreement

--------------------------------------------------------------------------------

SUBSIDIARIES

AMERIPATH 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

AMERIPATH CINCINNATI, INC.

(an Ohio corporation)

AMERIPATH CLEVELAND, INC.

(an Ohio corporation)

AMERIPATH CONSOLIDATED LABS, INC.

(a Florida corporation)

AMERIPATH FLORIDA, LLC

(a Delaware limited liability company)

AMERIPATH HOSPITAL SERVICES - FLORIDA, LLC

(a Delaware corporation)

 

AMERIPATH INDIANA, LLC

(an Indiana limited liability company)

AMERIPATH KENTUCKY, INC.

(a Kentucky corporation)

AMERIPATH LUBBOCK 5.01(a)

CORPORATION

(a Texas not-for-profit corporation)

AMERIPATH MARKETING USA, INC.

(a Florida corporation)

AMERIPATH MICHIGAN, INC.

(a Michigan corporation)

AMERIPATH MISSISSIPPI, INC.

(a Mississippi corporation)

AMERIPATH NEW YORK, LLC

(a Delaware corporation)

AMERIPATH NORTH CAROLINA, INC.

(a North Carolina corporation)

AMERIPATH OHIO, INC.

(a Delaware corporation)

AMERIPATH PAT 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

AMERIPATH PENNSYLVANIA, LLC

(a Pennsylvania limited liability company)

AMERIPATH PHILADELPHIA, INC.

(a New Jersey corporation)

 

Signature Page to Collateral Agreement

--------------------------------------------------------------------------------

AMERIPATH SAN ANTONIO 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

AMERIPATH SEVERANCE 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

AMERIPATH WISCONSIN, LLC

(a Wisconsin limited liability company)

AMERIPATH YOUNGSTOWN LABS, INC.

(an Ohio corporation)

AMERIPATH YOUNGSTOWN, INC.

(an Ohio corporation)

AMERIPATH, LLC

(a Delaware limited liability company)

ANATOMIC PATHOLOGY SERVICES, INC.

(an Oklahoma corporation)

API NO. 2, LLC

(a Delaware limited liability company)

ARIZONA PATHOLOGY GROUP, INC.

(an Arizona corporation)

ARLINGTON PATHOLOGY ASSOCIATION 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

DERMATOPATHOLOGY SERVICES, INC.

(an Alabama corporation)

DFW 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

DIAGNOSTIC PATHOLOGY MANAGEMENT SERVICES, LLC

(an Oklahoma limited liability company)

KAILASH B. SHARMA, M.D., INC.

(a Georgia corporation)

NAPA 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

OCMULGEE MEDICAL PATHOLOGY ASSOCIATION, INC.

(a Georgia corporation)

O’QUINN MEDICAL PATHOLOGY ASSOCIATION, LLC

(a Georgia limited liability company)

 

Signature Page to Collateral Agreement

--------------------------------------------------------------------------------

PCA OF DENVER, INC.

(a Tennessee corporation)

PCA OF NASHVILLE, INC.

(a Tennessee corporation)

PCA SOUTHEAST II, INC.

(a Tennessee corporation)

PETER G. KLACSMANN, M.D., INC.

(a Georgia corporation)

REGIONAL PATHOLOGY CONSULTANTS, LLC

(a Utah limited liability company)

ROCKY MOUNTAIN PATHOLOGY, L.L.C.

(a Utah limited liability company)

SHARON G. DASPIT, M.D., INC.

(a Georgia corporation)

SHOALS PATHOLOGY ASSOCIATES, INC.

(an Alabama corporation)

SIMPSON PATHOLOGY 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

SPECIALTY LABORATORIES, INC.

(a California Corporation)

STRIGEN, INC.

(a Utah corporation)

TID ACQUISITION CORP.

(a Delaware corporation)

TXAR 5.01(a) CORPORATION

(a Texas not-for-profit corporation)

 

By:

 

/s/ David L. Redmond

--------------------------------------------------------------------------------

Name:

 

David L. Redmond

Title:

 

Vice President

 

Signature Page to Collateral Agreement

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AMERIPATH TEXAS, LP

(a Delaware limited partnership)

By:   AmeriPath, LLC,     its General Partner By:  

/s/ David L. Redmond

--------------------------------------------------------------------------------

Name:   David L. Redmond Title:   Vice President

NUCLEAR MEDICINE AND PATHOLOGY ASSOCIATES

(a Georgia general partnership)

By:   Sharon G. Daspit, M.D.,     a General Partner By:  

/s/ David L. Redmond

--------------------------------------------------------------------------------

Name:   David L. Redmond Title:   Vice President

 

Signature Page to Collateral Agreement

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WACHOVIA BANK, NATIONAL

ASSOCIATION, AS COLLATERAL AGENT,

By:  

/s/ Scott Santa Cruz

--------------------------------------------------------------------------------

Name:   Scott Santa Cruz Title:   Director

 

Signature Page to Collateral Agreement