Exhibit 4
FORM OF
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PLEDGE AND SECURITY AGREEMENT
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PLEDGE AND SECURITY AGREEMENT, dated ______ ___, 1998 (the
"Agreement"), by and between Healthcare Imaging Services, Inc., a Delaware
corporation (the "Pledgee"), and _________ (the "Pledgor").
RECITALS
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WHEREAS, Pledgor has issued a promissory note, dated as of the date
hereof, in favor of the Pledgee in the principal amount of ______ Dollars
($____) (the "Note");
WHEREAS, the Pledgor owns _______ shares of Series D Cumulative
Accelerating Redeemable Preferred Stock of the Pledgee (the "Pledged Shares");
and
WHEREAS, the Pledgee desires that the Pledgor pledge the Pledged Shares
to secure all of its obligations to the Pledgee under the Note.
NOW, THEREFORE, in consideration of the foregoing premises, the terms
and conditions herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Pledgor and the
Pledgee hereby agree as follows:
12. Defined Terms.
(a) Capitalized terms used herein which are not otherwise
defined herein shall have the respective meanings ascribed thereto in the Note.
(b) When used in this Agreement, the following capitalized
terms shall have the respective meanings ascribed thereto as follows:
"Agreement": as defined in the preamble of this Agreement.
"Asset Purchase Agreement": shall mean the Asset Purchase
Agreement, dated as of September 16, 1998, among Healthcare Imaging Services,
Inc., [Pledgor,] Echelon MRI, P.C., Mainland Imaging Center, P.C., North Jersey
Imaging Management Associates, L.P., Bloomfield Imaging Associates, P.A., ▇▇▇▇▇▇
▇. ▇▇▇▇▇, M.D., P.A., the estate of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Deceased, ▇▇▇▇▇▇▇ ▇▇▇▇▇ and
▇▇▇ ▇▇▇▇▇, M.D.
"Business Day": shall mean any day other than a day on
which banks are authorized or required to be closed in the State of New Jersey.
"Cash Substitution Amount": as defined in Section 3.
"Collateral": as defined in Section 2.
"Event of Default": as defined in Section 7.
"Governmental Authority": shall mean any governmental
authority including, without limitation, any federal, state, territorial,
county, municipal or other governmental agency, board, branch, bureau,
commission, court, arbitration panel, department, authority, body or other
instrumentality or political unit or subdivision or official thereof, whether
domestic or foreign.
"Instruments": shall mean any and all legal documents,
including, without limitation, stock certificates or any document evidencing
stock ownership.
"Lien": shall mean any security agreement, financing
statement (whether or not filed), mortgage, lien (statutory or otherwise),
charge, pledge, hypothecation, conditional sales agreement, adverse claim, title
retention agreement or other security interest, encumbrance, lien, charge,
restrictive agreement, mortgage, deed of trust, indenture, pledge, option,
limitation, exception to or other title defect in or on any interest or title of
any vendor, lessor, lender or other secured party to or of such Person under any
conditional sale, lease, consignment, or bailment given for security purposes,
trust receipt or other title retention agreement with respect to any property or
asset of such Person, whether direct, indirect, accrued or contingent.
"Note": as defined in the preamble of this Agreement.
"Obligations": shall mean all the obligations and
liabilities of every kind and character now or hereafter existing (whether
matured or unmatured, contingent or liquidated) of Pledgee under the Note and
any costs and expenses incurred by the Pledgee in the collection of the Note,
including reasonable attorney's fees and expenses, whether or not a suit to
enforce such rights is actually instituted.
"Person": shall mean any corporation, partnership, firm,
joint venture, individual, association, trust, unincorporated organization or
other entity.
"Pledgee": as defined in the preamble of this Agreement.
"Pledged Shares": as defined in the preamble of this
Agreement.
"Pledgor": as defined in the preamble of this Agreement.
"Proceeds": shall mean all dividends, distributions and
income received with respect to the Pledged Shares.
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"Securities Act": as defined in Section 8.
"UCC": shall mean the Uniform Commercial Code as in effect
in the State of New Jersey on the date hereof; provided, however, in the event
that, by reason of mandatory provisions of law, any or all of the attachment,
perfection or priority of the Pledgee's security interest in the Collateral is
governed by the Uniform Commercial Code as in effect in a jurisdiction other
than the State of New Jersey, the term "UCC" shall mean the Uniform Commercial
Code as in effect in such other jurisdiction for purposes of the provisions
hereof relating to such attachment, perfection or priority and for purposes of
definitions related to such provisions.
13. Grant of Security Interest/Pledge. To secure the prompt and
complete payment, observance and performance of the Obligations (subject to any
applicable grace and cure periods), the Pledgor hereby assigns, conveys,
pledges, hypothecates and transfers to the Pledgee, and hereby grants to the
Pledgee a security interest in and Lien on, all of the Pledgor's right, title
and interest in and to the Pledged Shares, any interest into which the foregoing
may be converted or exchanged, whether by recapitalization, reclassification,
reorganization or other similar transaction or event, and all of the Proceeds of
the foregoing, whether now owned or existing or hereafter arising or acquired
(collectively, the "Collateral").
14. Substitution. At any time and from time to time, the Pledgor may,
upon compliance with the procedures set forth herein, obtain possession of all
or any portion of the Pledged Shares by substituting therefor a cash amount
equal to the Value of the Pledged Shares (the "Cash Substitution Amount"). In
the event that the Pledgor desires to engage in such substitution, it shall
deliver a written notice to the Pledgee stating its desire to engage in such
substitution and its calculation of the Cash Substitution Amount. In engaging in
a substitution, the Pledgor shall be entitled to substitute cash proceeds to be
derived from the redemption or sale of all or a portion of the Pledged Shares.
The parties hereto shall take such action, at the sole cost and expense of the
Pledgor, as is reasonably necessary to permit and facilitate any such redemption
or sale and substitution.
15. Rights; Interests; Etc.
(a) So long as no Event of Default shall have occurred and
be continuing:
(i) The Pledgor shall be entitled to exercise any and all
rights pertaining to the Collateral or any part thereof, including,
without limitation, voting rights, for any purpose not inconsistent
with the terms hereof or of the Note and in accordance with the terms
of the Asset Purchase Agreement, and the Pledgee shall take all actions
necessary to enable the Pledgor to exercise such rights in a timely
manner; and
(ii) The Pledgor shall be entitled to receive and retain
any and all interest, dividends, income and other payments and
distributions paid or made in respect of the Collateral.
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(b) Upon the occurrence and during the continuance of an
Event of Default:
(i) All rights of the Pledgor to exercise the rights
which it would otherwise be entitled to exercise pursuant to Section
4(a)(i) hereof and to receive the interest, dividends, income and other
payments and distributions which it would otherwise be authorized to
receive and retain pursuant to Section 4(a)(ii) hereof shall be
suspended, and all such rights shall thereupon become vested in the
Pledgee who shall thereupon have the sole right to exercise such rights
and to receive and hold as Collateral such interest, dividends, income
and other payments and distributions; provided, however, that if the
Pledgee shall become entitled and shall elect to exercise its right to
realize on the Collateral pursuant to Section 8 hereof, then all cash
sums and the value of all securities, if any, referred to in Section
4(a)(ii) hereof received by the Pledgee, or held by Pledgor for the
benefit of the Pledgee and paid over to the Pledgee pursuant to Section
4(b)(ii) hereof, shall be applied against any outstanding Obligations;
and
(ii) All interest, dividends, income and other payments
and distributions which are received by the Pledgor contrary to the
provisions of Section 4(b)(i) shall be received in trust for the
benefit of the Pledgee, shall be segregated from other property of the
Pledgor and shall be forthwith paid over to the Pledgee.
16. Representations of the Pledgor. The Pledgor represents and warrants
to the Pledgee as follows:
(a) The Pledgor has the legal right and capacity to grant the
Lien in the Collateral pursuant hereto;
(b) No consent or authorization of, filing with, or other act
by or in respect of, any Governmental Authority and no consent of any Person is
required (i) for the pledge by the Pledgor of any Collateral pursuant to this
Agreement, or (ii) for the exercise by the Pledgee of the rights provided for in
this Agreement or the remedies in respect of the Collateral pursuant to this
Agreement, except such as have been obtained or made or may be required under
federal or state securities laws in connection with any sale of the Collateral;
(c) The Pledgor is the sole legal and beneficial owner of, and
has valid and transferable title to, the Collateral pledged by the Pledgor to
the Pledgee pursuant hereto, free and clear of all Liens, other than the Lien in
favor of the Pledgee created by this Agreement;
(d) The Pledged Shares are fully paid and non-assessable and
are not subject to any charter, bylaw, statutory, contractual or other
restrictions governing their issuance, transfer, ownership or control other than
as set forth in the Asset Purchase Agreement, and the exhibits thereto, and
applicable securities laws; and
(e) All actions required to create and perfect the Lien of the
Pledgee in the
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Collateral have been taken and the delivery to the Pledgee of the Collateral is
effective to create a valid, perfected and exclusive first priority Lien on the
Collateral in favor of the Pledgee.
17. Obligations of the Pledgor. The Pledgor further represents,
warrants, and covenants to the Pledgee that:
(a) Except as set forth on Schedule A hereto, the Pledgor will
not, without the prior written consent of the Pledgee, sell, transfer or convey
any interest in, or suffer or permit any Lien on or with respect to, any of the
Collateral (other than as created under this Agreement) during the term of this
Agreement;
(b) Simultaneously with the execution of this Agreement, the
Pledgor will deliver to the Pledgee all instruments and stock certificates
representing the Pledged Shares, together with appropriate undated instruments
of transfer or assignment duly executed in blank. In addition, the Pledgor shall
promptly deliver to the Pledgee stock certificates or other documents
representing any Collateral acquired or received after the date of this
Agreement;
(c) The Pledgor will, at its own expense, at any time and from
time to time at the request of the Pledgee, do, make, procure, execute and
deliver all acts, things, writings, assurances and other documents as may be
requested by the Pledgee to further enhance, preserve, establish, demonstrate,
perfect or enforce the Pledgee's rights, interest and remedies created by,
provided in or emanating from this Agreement;
(d) The Pledgor, at its own expense, shall defend the
Collateral against all claims of any kind or nature at any time by any Person
claiming the same or any interest therein adverse to the interests of the
Pledgee;
(e) Except as otherwise required by law, the Pledgor agrees
that, with respect to the Collateral, the Pledgee does not have any obligation
to preserve its rights against prior or third parties; and
(f) The Pledgee's only duty with respect to the Collateral
delivered to it shall be to use reasonable care in the custody and preservation
of such Collateral, and the Pledgor agrees that if the Pledgee accords such
Collateral substantially the same kind of care as it accords its own property,
such care shall conclusively be deemed reasonable. In the event that all or any
part of the Collateral consists of Instruments and that all or any part of such
Instruments are lost, destroyed or wrongfully taken while such Instruments are
in the possession of the Pledgee, the Pledgor agrees that it will use its best
efforts to cause the delivery of new Instruments in place of the lost, destroyed
or wrongfully taken Instruments upon request therefor by the Pledgee, without
the necessity of any indemnity bond or other security, other than the Pledgee's
agreement of indemnity upon usual and customary terms therefor.
18. Events of Default.
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Each of the following shall constitute an "Event of Default":
(a) If the Pledgor shall fail to observe or perform any
material term, covenant or agreement contained in this Agreement; or
(b) The occurrence of an Event of Default (as defined in the
Note) under the Note.
19. Remedies. Upon the occurrence of an Event of Default or at any time
during the continuance thereof:
(a) The Pledgee may exercise all rights and remedies of a
Pledgee under the UCC. Without limiting the generality of the foregoing, the
Pledgor expressly agrees that in any such event the Pledgee, without demand of
performance or other demand, advertisement or notice of any kind (except the
notice specified below of time and place of public or private sale) to or upon
the Pledgor, or any other Person (all and each of which demands, advertisements
and/or notices are hereby expressly waived to the extent permitted by law), may
forthwith assume, collect, receive, appropriate and realize upon the Collateral,
or any part thereof, and/or may forthwith sell, lease, assign, give an option or
options to purchase, or sell or otherwise dispose of and deliver the Collateral
(or contract to do so), or any part thereof, in one or more parcels at a public
or private sale or sales, at any exchange broker's board or at the Pledgee's
offices or elsewhere at such prices and on such terms and restrictions
(including, without limitation, a requirement that any purchaser of all or any
part of the Collateral shall be required to purchase the Pledged Shares solely
for investment and without any intention to make a distribution thereof) as the
Pledgee may deem appropriate without any liability for any loss due to decrease
in the market value of the Pledged Shares during the period held. The Pledgee
shall give the Pledgor ten (10) Business Days' prior notice of any intended
disposition of the Collateral. Such notice shall be deemed reasonable and
properly given if hand delivered or sent by facsimile to the address or
facsimile number, as applicable, of the Pledgor indicated below. Any disposition
of the Pledged Shares or any part thereof may be for cash or on credit or for
future delivery without assumption of any credit risk, with the right to the
Pledgee to purchase all or any part of the Pledged Shares so sold at any such
sale or sales, public or private, free of any equity or right of redemption
which right or equity is, to the extent permitted by applicable law, hereby
expressly waived and released by the Pledgor.
(b) All of the Pledgee's rights and remedies under this
Agreement and under applicable law, including but not limited to the foregoing,
shall be cumulative and not exclusive and shall be enforceable alternatively,
successively or concurrently as the Pledgee may deem expedient.
(c) The Pledgor recognizes that the Pledgee may be unable to
effect a public sale of all or a part of the Pledged Shares by reason of certain
prohibitions contained in the Securities Act of 1933, as amended (the
"Securities Act"), or other relevant securities law in any jurisdiction, but may
be compelled to resort to one or more private sales to a restricted group of
purchasers who will be obligated to agree, among other things, to acquire the
Pledged Shares for their own account, for investment and not with a view to the
distribution or resale thereof. The Pledgor agrees that private
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sale so made may be at prices and on other terms less favorable to the seller
than if the Pledged Shares were sold at public sale, and that the Pledgee has no
obligation to delay the sale of any Pledged Shares for the period of time
necessary to permit the registration of the Pledged Shares for public sale under
the Securities Act or other relevant securities law in any jurisdictions. The
Pledgor agrees that a private sale or sales made under the foregoing
circumstances shall be commercially reasonable.
(d) If any consent, approval or authorization of, or filing
with, any Governmental Authority or any other Person should be necessary to
effectuate any sale or other disposition of the Collateral, or any partial
disposition of the Collateral, the Pledgor agrees to execute all such
applications and other instruments as may be required in connection with
securing any such consent, approval or authorization or making such filing, and
will otherwise use its best efforts to secure or file the same. The Pledgor
further agrees to use its best efforts to secure such sale or other disposition
of the Collateral as the Pledgee may deem necessary pursuant to the terms of
this Agreement.
(e) Upon any sale or other disposition, the Pledgee shall have
the right to deliver, endorse, assign and transfer to the purchaser thereof the
Collateral so sold or disposed of. Each purchaser at any such sale or other
disposition, including the Pledgee, shall hold the Collateral free from any
claim or right of whatever kind, including any equity or right of redemption.
The Pledgor specifically waives, to the extent permitted by applicable law, all
rights of stay or appraisal which the Pledgor had or may have under any rule of
law or statute now existing or hereafter adopted.
(f) The Pledgee shall not be obligated to make any sale or
other disposition unless the terms thereof shall be satisfactory to it. The
Pledgee may, without notice or publication, adjourn any private or public sale,
and, upon five (5) Business Days' prior notice to the Pledgor, hold such sale at
any time or place to which the same may be so adjourned. In case of any sale of
all or any part of the Collateral, on credit or future delivery, the Collateral
so sold may be retained by the Pledgee until the selling price is paid by the
purchaser thereof, but the Pledgee shall incur no liability in case of the
failure of such purchaser to take up and pay for the property so sold and, in
case of any such failure, such property may again be sold as herein provided.
20. Disposition of Proceeds. The proceeds of any sale or disposition of
all or any part of the Collateral shall be applied (after payment of any amounts
payable to the Pledgee pursuant to Section 11 hereof) by the Pledgee to the
payment of all of the Obligations. Any surplus thereafter remaining shall be
paid to the Pledgor, subject to the rights of any holder of a Lien on the
Collateral of which the Pledgee has actual notice.
21. Binding Obligation. This Agreement shall:
(a) create a continuing first priority security interest in the
Collateral;
(b) remain in full force and effect for so long as the
Obligations are outstanding and unpaid;
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(c) be binding upon the Pledgor and its successors and assigns;
and
(d) inure to the benefit of the Pledgee and its successors and
assigns.
22. Expenses of the Pledgee. All expenses (including, without
limitation, attorneys' fees and disbursements) incurred by the Pledgee in
connection with the failure by the Pledgor to perform or observe any provision
of this Agreement, the exercise or enforcement of any rights of the Pledgee
under this Agreement and the custody or preservation of any of the Collateral
and any actual or attempted sale or exchange of, or any enforcement, collection,
compromise or settlement respecting, the Collateral, or any other action taken
by the Pledgee hereunder, whether directly or as attorney-in-fact pursuant to a
power of attorney or other authorization herein conferred, shall be deemed an
obligation of the Pledgor and shall be deemed an Obligation for all purposes of
this Agreement and the Pledgee may apply the Collateral to payment of or
reimbursement of itself for such liability.
23. Termination. This Agreement shall terminate, and the Pledgee shall
forthwith assign, transfer and deliver such of the Collateral as shall not have
been sold or otherwise applied pursuant to the terms hereof to the Pledgor when
the Obligations have been completely paid and satisfied in full.
24. Power of Attorney. The Pledgor hereby irrevocably constitutes and
appoints the Pledgee as the true and lawful attorney of the Pledgor, with full
power of substitution in the name of the Pledgor from time to time upon the
occurrence and during the continuation of an Event of Default to do any and all
such acts and things or execute and deliver all such agreements, documents and
instruments as the Pledgee reasonably considers necessary or desirable to carry
out the provisions and purposes of this Agreement or to exercise any of its
rights and remedies hereunder and to perfect the Lien created hereunder, and to
do all acts or things necessary to realize on the Collateral, and the Pledgor
hereby ratifies and agrees to ratify all acts of any attorney taken or done in
accordance with this Section 13. Without in any way limiting the generality of
the foregoing, the Pledgee shall have the right to execute, for and in the name
of the Pledgor, all financing statements and amendments thereto, conveyances,
transfers, assignments, consents and other instruments as may be required for
such purposes. This power of attorney is coupled with an interest and shall not
be revoked or terminated by any act or thing other than the termination of this
Agreement in accordance with Section 12 hereof.
25. General Provisions.
(a) No failure on the part of the Pledgee to exercise, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by the Pledgee of any
right, power or remedy hereunder preclude any other or future exercise thereof,
or the exercise of any other right, power or remedy. The representations,
covenants and agreements of the Pledgor herein contained shall survive the date
hereof.
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(b) No amendment or waiver of any provision of this Agreement
nor consent to the departure by the Pledgor herefrom nor release of all or any
part of the Collateral shall in any event be effective unless the same shall be
in writing and consented to in writing by the Pledgee. Any such waiver or
consent or release shall be effective only in the specific instance and for the
specific purpose for which it is given.
(c) The obligations of the Pledgor under this Agreement shall
remain in full force and effect without regard to, and shall not be impaired or
affected by:
(i) any amendment, modification, addition or
supplement to the Note, any document or instrument delivered in
connection therewith or any assignment or transfer thereof;
(ii) any exercise, non-exercise or waiver by the
Pledgee of any right, remedy, power or privilege under or in
respect of the Note; or
(iii) any bankruptcy, insolvency, reorganization,
arrangement, readjustment, composition, liquidation or the like of
the Pledgor or any other Person;
in all cases, whether or not the Pledgor shall have notice or knowledge of any
of the foregoing.
(d) Except as provided on Schedule A hereto, the Pledgor may
not assign its rights or obligations under this Agreement without the prior
written consent of the Pledgee.
(e) Any notice, demand, request, waiver, or other
communication under this Agreement shall be in writing and shall be deemed to
have been duly given on the date of service, if personally served or sent by
telecopy; on the business day after notice is delivered to a courier or mailed
by express mail, if sent by courier delivery service or express mail for next
day delivery; and on the third day after mailing, if mailed to the party to whom
notice is to be given, by first class mail, registered, return receipt
requested, postage prepaid and addressed as follows:
If to the Pledgor, to:
--------------------
--------------------
--------------------
Fax:
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Blank Rome Comisky & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Pledgee, to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Healthcare Imaging Services, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ Berlin Shereff ▇▇▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
(f) This Agreement shall be construed in accordance with, and
governed by, the Laws of the State of New Jersey as applied to contracts made
and to be performed entirely in the State of New Jersey without regard to
principles of conflicts of Law. Each of the parties hereto hereby irrevocably
and unconditionally submits to the exclusive jurisdiction of any court of the
State of New Jersey or any federal court sitting in the State of New Jersey for
purposes of any suit, action or other proceeding arising out of this Agreement
(and agrees not to commence any action, suit or proceedings relating hereto
except in such courts). Each of the parties hereto agrees that service of any
process, summons, notice or document by U.S. registered mail at its address set
forth herein shall be effective service of process for any action, suit or
proceeding brought against it in any such court. Each of the parties hereto
hereby irrevocably and unconditionally waives any objection to the laying of
venue of any action, suit or proceeding arising out of this Agreement, which is
brought by or against it, in the courts of the State of New Jersey or any
federal court sitting in the State of New Jersey and hereby further irrevocably
and unconditionally waives and agrees not to plead or claim in any such court
that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum.
(g) If any provision of this Agreement is determined by a
court of competent jurisdiction to be unenforceable, such provision shall be
automatically reformed and construed so as to be valid, operative and
enforceable to the maximum extent permitted by law while most nearly preserving
its original intent. The invalidity of any part of this Agreement shall not
render invalid the remainder of this Agreement.
(h) This Agreement may be executed in counterparts, each of
which when so
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executed and delivered shall be deemed an original, but all such counterparts
taken together shall constitute but one and the same instrument.
(i) The section headings in this Agreement are for convenience
of reference only and shall not affect the interpretation hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.
[PLEDGOR]
By:
Name:
Title:
HEALTHCARE IMAGING SERVICES, INC.
By:
Name:
Title:
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SCHEDULE A
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Pledgor may assign its rights and obligations under the Pledge and
Security Agreement and may transfer the Collateral, subject to the terms and
provisions of the Pledge and Security Agreement, to a liquidating trust upon
Pledgor's dissolution and/or liquidation provided that such liquidating trust is
also assigned substantially all of the non-cash assets of Pledgor, including the
Collateral.
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