ASSIGNMENT AND SECURITY AGREEMENT
THIS ASSIGNMENT AND SECURITY AGREEMENT (this "Agreement") is made and
entered into as of the 1 day of September, 1999, by and between Prime Medical
Operating, Inc., a Delaware corporation (the "Secured Party") and LASIK
Investors, L.L.C., a Delaware limited liability company ("LASIK").
RECITALS:
A. LASIK and Secured Party have executed and delivered that certain
Contribution Agreement dated effective September 1, 1999, between and among
LASIK, Secured Party, Prime/BDR Acquisition, L.L.C., a Delaware limited
liability company (the "Debtor"), Prime Medical Services, Inc., a Delaware
corporation ("PMSI"), Prime/BDEC Acquisition, L.L.C., a Delaware limited
liability company, Barnet ▇▇▇▇▇▇▇ Eye Center, P.L.L.C., an Arizona professional
limited liability company, ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, M.D., ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, M.D., and
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ (the "Contribution Agreement"), and Debtor and Secured Party have
executed and delivered that certain Loan Agreement, dated September ____, 1999
(the "Loan Agreement"), pursuant to which Secured Party agrees to make certain
loans to Debtor on the terms and subject to the conditions provided therein.
B. Secured Party has requested that LASIK pledge the Collateral (as defined
below) to secure certain obligations and liabilities that Debtor may now or
hereafter have to Secured Party, including, without limitation, any obligations
arising under loans made pursuant to the Loan Agreement.
C. LASIK desires to enter into this Agreement as a material inducement
to Secured Party's extension of credit under the Loan Agreement.
AGREEMENT:
NOW, THEREFORE, in consideration of the foregoing and the covenants and
agreements hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency of which LASIK acknowledges, LASIK and Secured Party
agree as follows:
ARTICLE I
COLLATERAL AND SECURED OBLIGATIONS
1.1 Grant of Security Interest. LASIK hereby assigns, transfers, and
pledges to Secured Party, and LASIK hereby grants to Secured Party a security
interest in, the following described collateral (collectively, the
"Collateral"): --------------------------
(a) Interest in Subsidiary. All ownership interests of LASIK in Debtor,
whether now existing or hereafter acquired and including, without limitation,
that certain 40% membership interest in Debtor; ----------------------
(b) Accounts. All accounts and rights now or hereafter attributable to
any of the Collateral described in (a) above, and all rights of LASIK now
or hereafter arising under any agreement pertaining to the Collateral
described in (a) above, including without limitation all distributions,
proceeds, fees, dividends, preferences, payments or other benefits of
whatever nature which LASIK is now or may hereafter become entitled to
receive with respect to any Collateral described in (a) -------- above;
(c) Additional Property. "Collateral" shall also include the
following property (collectively, the "Additional Property") which LASIK becomes
entitled to receive or shall receive as a result of its ownership of any other
Collateral: (i) any stock or other ownership certificate, including without
limitation, any certificate representing a stock dividend or any certificate in
connection with any recapitalization, reclassification, merger, consolidation,
conversion, sale of assets, combination, stock split, reverse stock split, or
spin-off; (ii) any option, warrant, subscription or right, whether as an
addition to or in substitution of any other Collateral; (iii) any dividends or
distributions of any kind whatsoever, whether distributable in cash, stock or
other property; (iv) any interest, premium or principal payments; and (v) any
conversion or redemption proceeds; and
(d) Proceeds. All proceeds (cash and non-cash) arising out of the
sale, exchange, collection or other disposition of all or any portion of
the Collateral described in (a), (b) or (c) above, including without
limitation proceeds in the form of stock, accounts, chattel paper,
instruments, documents, goods, inventory and equipment. --------
The security interest in the Collateral hereby granted by LASIK to Secured Party
may sometimes be referred to in this Agreement as the "Security Interest".
1.2 Obligations. This Agreement and the Security Interest shall secure
full and punctual payment and performance of the following indebtedness,
duties and obligations (collectively, the "Obligations"): -----------
(a) All liabilities and obligations of Debtor to Secured Party
(including, without limitation, any principal, interest, fees and other
amounts, and any other obligations) under and pursuant to the Loan
Agreement and each promissory note (collectively, the "Note") issued
pursuant to the Loan Agreement; and
(b) All liabilities and obligations of LASIK to Secured Party, PMSI or
any Prime Indemnified Parties (as defined in the Contribution Agreement)
under and pursuant to the Contribution Agreement or this Agreement.
ARTICLE II
LASIK'S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO COLLATERAL
LASIK hereby represents and warrants to Secured Party as follows:
2.1 Ownership of Collateral. LASIK has good and marketable title to
the Collateral free and clear of any liens, security interests,
shareholders agreement, calls, charge, or encumbrance, except for this
Security Interest. No financing statement or other instrument similar in
effect covering all or any part of the Collateral is on file in any
recording office, except as may have been filed in favor of Secured Party
relating to this Agreement. -----------------------
2.2 Power & Authority. LASIK has the lawful right, power, and
authority to grant the Security Interest in the Collateral. This Agreement,
together with all filings and other actions necessary or desirable to
perfect and protect such security interest, which have been duly taken,
create a valid and perfected first priority security interest in the
Collateral securing the payment and performance of the Obligations.
-----------------
2.3 No Agreements. The Interests are not subject to any right of
redemption, or any call or put options, voting trust, proxy, shareholders
agreement, right of first refusal, or any other document or agreement which
would in any way impair or adversely affect this Security Interest or the
rights of Secured Party under this Agreement. -------------
2.4 Securities. Any certificates evidencing securities pledged as
Collateral are valid and genuine and have not been altered. All securities
pledged as Collateral have been duly authorized and validly issued, are
fully paid and non-assessable, and were not issued in violation of the
preemptive rights of any party or of any agreement by which LASIK or the
issuer thereof is bound. Except as expressly provided otherwise in the
Contribution Agreement or any Transaction Document (as therein ----------
defined), no restrictions or conditions exist with respect to the transfer
or voting of any securities pledged as Collateral.
ARTICLE III
LASIK'S OTHER REPRESENTATIONS AND WARRANTIES
3.1 Solvency of LASIK. As of the date hereof, (i) LASIK is solvent;
(ii) the fair saleable value of LASIK's assets exceeds its liabilities (both
fixed and contingent); (iii) LASIK has sufficient capital to satisfy all of
LASIK's obligations as they become due; (iv) no receiver, trustee, or custodian
has been appointed for, or taken possession of, all or substantially all of the
assets of LASIK, either in a proceeding brought by LASIK or in a proceeding
brought against LASIK; (v) LASIK is not the subject of a petition for relief
under the United States Bankruptcy Code or any similar federal or state
insolvency law, including without limitation a petition filed by LASIK or a
petition filed by a third party seeking relief against LASIK; and (vi) LASIK has
no intention of filing a petition for relief under the United States Bankruptcy
Code or any similar federal or state insolvency law, or of seeking any other
form of creditor relief.
3.2 Authority and Compliance. LASIK has full power and authority to
enter into this Agreement. LASIK has full power and authority to enter into
and perform its obligations under each Other Agreement. No further consent
or approval is required as a condition to the validity of this Agreement or
any Other Agreement. LASIK is in compliance with all applicable laws,
ordinances, statutes, orders, regulations, judgments, writs, or decrees of
any governmental entity to which it is subject. ------------------------
3.3 Binding Agreement. This Agreement and each Other Agreement
constitute valid and legally binding obligations of LASIK, in accordance
with their terms, subject to the applicable bankruptcy, insolvency,
reorganization, moratorium, and similar laws affecting creditors' rights
generally. -----------------
3.4 Litigation. There are no proceedings pending or, to the knowledge
of LASIK, threatened before any court or administrative agency which will
or may have a material adverse effect on the financial condition of LASIK
or upon LASIK's ability to perform its obligations under this Agreement or
any Other Agreement. ----------
3.5 No Conflicting Agreements. There are no provisions of any existing
agreement, mortgage, indenture or contract binding on LASIK or affecting
its property, which would conflict with or in any way prevent the
execution, delivery, or carrying out of the terms of this Agreement or any
Other Agreement. -------------------------
3.6 Ownership of Assets. LASIK has good and full title to the
Collateral, and the Collateral is owned free and clear of liens, charges,
claims, security interests, and other encumbrances. -------------------
3.7 Taxes. LASIK has filed all tax returns required to be filed by
LASIK.
ARTICLE IV
LASIK'S COVENANTS WITH RESPECT TO COLLATERAL
LASIK covenants and agrees that from the date hereof and until the
payment and performance in full of the Obligations unless Secured Party
otherwise consents in writing:
4.1 Delivery of Instruments and/or Certificates. Contemporaneously
herewith, LASIK covenants and agrees to deliver to Secured Party any
certificates, documents, or instruments representing or evidencing the
Collateral, with LASIK's endorsement thereon and/or accompanied by proper
instruments of transfer and assignment duly executed in blank.
-------------------------------------------
4.2 Further Assurances. LASIK will contemporaneously with the execution
hereof and from time to time thereafter at its expense promptly execute and
deliver all further instruments and documents and take all further action
necessary or appropriate or that Secured Party may request in order (i) to
perfect and protect the security interest created or purported to be created
hereby and the first priority of such security interest, (ii) to enable Secured
Party to exercise and enforce its rights and remedies hereunder in respect of
the Collateral, and (iii) to otherwise effect the purposes of this Agreement,
including without limitation: (A) executing and filing any financing or
continuation statements, or any amendments thereto; (B) obtaining written
confirmation from the issuer of any securities pledged as Collateral of the
pledge of such securities, in form and substance satisfactory to Secured Party;
(C) cooperating with Secured Party in registering the pledge of any securities
pledged as Collateral with the issuer of such securities; (D) delivering notice
of Secured Party's security interest in any securities pledged as Collateral to
any securities or financial intermediary, clearing corporation or other party
required by Secured Party, in form and substance satisfactory to Secured Party;
and (E) obtaining written confirmation of the pledge of any securities
constituting Collateral from any securities or financial intermediary, clearing
corporation or other party required by Secured Party, in form and substance
satisfactory to Secured Party.
4.3 Additional Property. All Additional Property, as defined in Section
1.1(c) above, received by LASIK shall be received in trust for the benefit of
Secured Party. All Additional Property and all certificates or other written
instruments or documents evidencing and/or representing the Additional Property
that is received by LASIK, together with such instruments of transfer as Secured
Party may request, shall immediately be delivered to or deposited with Secured
Party and held by Secured Party as Collateral under the terms of this Agreement.
If the Additional Property received by LASIK and delivered to Secured Party
pursuant to this Section shall be shares of stock or other securities, such
shares of stock or other securities shall be duly endorsed in blank or
accompanied by proper instruments of transfer and assignment duly executed in
blank with, if requested by Secured Party, signatures guaranteed by a member or
member organization in good standing of an authorized Securities Transfer Agents
Medallion Program, all in form and substance satisfactory to Secured Party.
Secured Party shall be deemed to have possession of any Collateral in transit to
Secured Party or its agent.
4.4 Sale, Transfer, Encumbrance. LASIK will not sell, transfer,
mortgage, or otherwise encumber any Collateral or impair the value thereof in
any manner without Secured Party's prior written consent, including without
limitation by purchase, lease, barter, trade, payment deferral, or the creation,
assumption or guarantee of indebtedness or other lending of credit. Secured
Party's written consent to any sale, mortgage, transfer, or encumbrance shall
not be construed to be a waiver of this provision in respect to any subsequent
proposed sale, mortgage, transfer, or encumbrance.
4.5 Liens. Neither LASIK nor any person acting on LASIK's behalf has,
or shall have any right, power, or authority to and shall not create,
incur, or permit to be placed or imposed, upon the Collateral, any lien of
any type or nature whatsoever, other than the liens in favor of Secured
Party. -----
4.6 Matters or Occurrences Affecting Collateral or this Agreement.
LASIK will promptly notify Secured Party of any and all matters or
occurrences that may have a material adverse effect on the status or value
of the Collateral or this Agreement, including without limitation the
occurrence of an Event of Default, or an event which, with giving of notice
or lapse of time, or both, would constitute an Event of Default.
-------------------------------------------------------------
4.7 Agreements Pertaining to Collateral. LASIK will not transfer any
voting rights pertaining to the Collateral to any person or entity.
-----------------------------------
4.8 Dilution of Ownership. As to any securities pledged as Collateral,
LASIK will not consent to or approve of the issuance of (i) any additional
interests or shares of any class of securities of such issuer, (ii) any
instrument convertible voluntarily by the holder thereof or automatically upon
the occurrence or non-occurrence of any event or condition into, or exchangeable
for, any such securities, or (iii) any warrants, options, contracts or other
commitments entitling any third party to purchase or otherwise acquire any such
securities.
4.9 Restrictions on Securities. LASIK will not enter into any
agreement creating, or otherwise permit to exist, any restriction or
condition upon the transfer, voting or control of any securities pledged as
Collateral, except as consented to in writing by Secured Party. As to any
securities pledged as collateral, LASIK will not consent to or approve of
any stock split, reverse stock split, stock dividend, reclassification, or
other similar act or transaction regarding the Interests unless
-------------------------- consented to in writing by Secured Party.
ARTICLE V
LASIK'S AFFIRMATIVE COVENANTS
Until payment and performance of all Obligations, LASIK covenants and
agrees that it shall promptly advise Secured Party in writing of any litigation
filed against LASIK and of any condition, event or act which comes to its
attention that would or might have a material adverse effect on LASIK's
financial condition.
ARTICLE VI
NEGATIVE COVENANTS
Until payment and performance of all Obligations, LASIK covenants and
agrees that LASIK will not, without the prior written consent of Secured Party
grant, suffer, or permit liens on, or security interests in, the Collateral.
ARTICLE VII
DEFAULT AND REMEDIES
7.1 Events of Default. An Event of Default (herein so called) shall
exist if any one or more of the following events shall occur:
-----------------
(a) The failure of Debtor to pay any amount required to be paid under
the Loan Agreement or any Note (including, without limitation, principal,
interest and fees due thereunder) within ten (10) calendar days after such
amount is due;
(b) The failure of LASIK to pay any Obligation described in Section
1.2(b) within ten (10) calendar days after such amount is due (and, if
applicable under the terms of any contractual agreement creating or
governing such Obligation, after the expiration of any cure period
expressly required);
(c) LASIK's breach of a covenant in this Agreement;
(d) Any representation or warranty made by LASIK in this Agreement
shall be false or materially misleading, as determined in the reasonable
discretion of Secured Party;
(e) Any event of default shall occur under the terms of the Loan
Agreement and shall not be cured within the time expressly provided for
with respect thereto in the Loan Agreement;
(f) If LASIK or Debtor, or any other party obligated to pay
any portion of the Obligations: (i) becomes insolvent, or makes a transfer in
fraud of creditors, or makes an assignment for the benefit of creditors, or
admits in writing its inability to pay its debts as they become due; (ii)
generally is not paying its debts as such debts become due and Secured Party, in
good faith, determines that such event or condition could lead to a material
impairment of the Collateral, or any part thereof, or of any other payment
security for any of the Obligations; (iii) has a receiver, trustee or custodian
appointed for, or take possession of, all or substantially all of the assets of
such party or any of the Collateral, either in a proceeding brought by such
party or in a proceeding brought against such party and such appointment is not
discharged or such possession is not terminated within sixty (60) days after the
effective date thereof or such party consents to or acquiesces in such
appointment or possession; (iv) files a petition for relief under the United
States Bankruptcy Code or any other present or future federal or state
insolvency, bankruptcy or similar laws (all of the foregoing hereinafter
collectively called "Applicable Bankruptcy Law") or an involuntary petition for
relief is filed against such party under any Applicable Bankruptcy Law and such
involuntary petition is not dismissed within sixty (60) days after the filing
thereof, or an order for relief naming such party is entered under any
Applicable Bankruptcy Law, or any composition, rearrangement, extension,
reorganization or other relief of debtors now or hereafter existing is requested
or consented to by such party; (v) fails to have discharged within a period of
sixty (60) days any attachment, sequestration or similar writ levied upon, or
any claim against or affecting, any property of such party; or (vi) fails to pay
within ninety (90) days any final money judgment against such party; or
(g) The issuer of any securities constituting Collateral files a
petition for relief under any Applicable Bankruptcy Law, an involuntary
petition for relief is filed against any such issuer under any Applicable
Bankruptcy Law and such involuntary petition is not dismissed within thirty
(30) days after the filing thereof, or an order for relief naming any such
issuer is entered under any Applicable Bankruptcy Law.
7.2 Secured Party's Remedies. Upon the occurrence of an Event of
Default:
(a) Secured Party may declare the Obligations in whole or part
immediately due and may enforce payment and performance of the same and
exercise any rights under the Texas UCC, rights and remedies of Secured
Party under this Agreement, or otherwise.
(b) Secured Party may, at Secured Party's option and at the
expense of LASIK, either in Secured Party's own right or in the name of LASIK
and in the same manner and to the same extent that LASIK might reasonably so act
if this Agreement had not been made: (i) do all things requisite, convenient, or
necessary to enforce the performance and observance of all rights, remedies and
privileges of LASIK arising from the Collateral, or any part thereof, including
without limitation compromising, waiving, excusing, or in any manner releasing
or discharging any obligation of any party to or arising from the Collateral;
(ii) take possession of the books, papers, chattel paper, documents of title,
and accounts of LASIK, wherever located, relating to the Collateral; (iii) ▇▇▇
or otherwise collect and receive money attributable to the Collateral; and (iv)
exercise any other lawfully available powers or remedies, and do all other
things which Secured Party deems requisite, convenient or necessary or which the
Secured Party deems proper to protect the Security Interest.
(b) Secured Party may foreclose this Agreement in the manner
now or hereafter provided or permitted by law and may upon such reasonable
notification prior thereto as may be required by applicable law (LASIK hereby
agreeing that ten days' notice is commercially reasonable), sell, assign,
transfer, or otherwise dispose of the Collateral at public or private sale, in
whole or in part, and Secured Party may, in its own name or as LASIK's
attorney-in-fact effectively assign and transfer the Collateral, or any part
thereof, absolutely, and execute and deliver all necessary assignments,
conveyances, bills of sale, and other instruments with power to substitute one
or more persons or corporations with like power. Any such foreclosure sale,
assignment, transfer, or other disposition shall, to the extent permitted by
law, be a perpetual bar, both at law and in equity, against LASIK and all
persons and corporations lawfully claiming by or through or under LASIK. Any
such foreclosure sale may be adjourned from time to time. Upon any sale, Secured
Party may bid for and purchase the Collateral, or any part thereof, and upon
compliance with the terms of sale may hold, retain, possess and dispose of the
Collateral, in its absolute right without further accountability. Secured Party
shall have the right to be credited on the amount of its bid a corresponding
amount of the Obligations as of the date of such sale.
(c) If, in the opinion of Secured Party, there is any question
that a public sale or distribution of any Collateral will violate any state or
federal securities law, Secured Party (i) may offer and sell securities
privately to purchasers who will agree to take them for investment purposes and
not with a view to distribution and who will agree to imposition of restrictive
legends on the certificates representing the security, or (ii) may sell such
securities in any type of offering which complies with, or is exempt from the
registration requirements of, the Securities Act of 1933, and no sale so made in
good faith by Secured Party shall be deemed to be not "commercially reasonable"
because so made.
(d) Not in limitation of any other provision of this Agreement,
Secured Party shall have all rights and remedies of a secured party under
the Texas UCC.
7.3 Application of Proceeds. Secured Party may apply the proceeds of
any foreclosure sale hereunder or from any other permitted disposition of the
Collateral or any part thereof as follows: (a) first, to the payment of all
reasonable costs and expenses of any foreclosure and collection hereunder and
all proceedings in connection therewith, including reasonable attorneys' fees;
(b) then, to the reimbursement of Secured Party for all disbursements made by
Secured Party for taxes, assessments or liens superior to the Security Interest
and which Secured Party shall deem expedient to pay; (c) then, to the
reimbursement of Secured Party of any other disbursements made by Secured Party
in accordance with the terms hereof or under the Contribution Agreement, the
Loan Agreement or any Note; (d) then, to or among the amounts of fees, interest
and principal then owing and unpaid in respect of the Obligations, in such
priority as Secured Party may determine in its discretion; and (e) the remainder
of such proceeds, if any, shall be paid to LASIK. If such proceeds shall be
insufficient to discharge the entire Obligations, Secured Party shall have any
other available legal recourse against LASIK under, or for the performance of,
the Contribution Agreement, the Loan Agreement and any Note, for the deficiency,
together with interest thereon at the maximum rate permitted under applicable
law.
7.4 Enforcement of Obligations. Nothing in this Agreement or in any
other document or agreement shall affect or impair the unconditional and
absolute right of Secured Party to enforce the Obligations as and when the
same shall become due. --------------------------
ARTICLE VIII
RIGHTS OF SECURED PARTY
8.1 Subrogation. Upon the occurrence of an Event of Default, Secured
Party, at its election, may subrogate to all of the interest, rights and
remedies of LASIK, in respect to any of the Collateral or agreements
pertaining thereto. -----------
8.2 Secured Party Appointed Attorney-in-Fact. LASIK hereby appoints
Secured Party as attorney-in-fact of LASIK, with full authority in the place and
stead of LASIK and in the name of LASIK, Secured Party or otherwise, from time
to time on Secured Party's discretion and upon the occurrence of an Event of
Default, to take any action and to execute any instrument which Secured Party
may deem necessary or advisable to accomplish the purposes of this Agreement,
including without limitation: (a) to ask, demand, collect, ▇▇▇ for, recover,
compound, receive and give acquittance and receipts for moneys due and to become
due under or in respect of any of the Collateral; (b) to receive, endorse, and
collect any drafts or other instruments, documents and chattel paper, in
connection with clause (a) of this Section 8.2; (c) to file any claims or take
any action or institute any proceeding which Secured Party may deem necessary or
desirable for the collection of any of the Collateral or otherwise to enforce
the rights of Secured Party against any of the Collateral; and (d) to assign and
transfer the Collateral, or any part thereof, absolutely and to execute and
deliver endorsements, assignments, conveyances, bills of sale and other
instruments with power to substitute one or more persons or corporation with
like power.
8.3 Performance by Secured Party. If LASIK fails to perform any
agreement contained herein, Secured Party may itself perform, or cause the
performance of, such agreement, and the reasonable expenses of Secured
Party incurred in connection therewith shall be payable by LASIK under
Section 8.8. In no event, however, shall Secured Party have any obligation
or duties whatsoever to perform any covenant or agreement of LASIK
contained herein, and any such performance by Secured Party shall be
---------------------------- wholly discretionary with Secured Party.
8.4 Duties of Secured Party. The powers conferred upon Secured Party
hereunder are solely to protect its interest in the Collateral and shall
not impose any duty upon it to exercise any such powers. Except for the
safe custody of any Collateral in its possession and the accounting for
money actually received by it hereunder, Secured Party shall have no duty
as to any Collateral or as to the taking of any necessary steps to preserve
rights against prior parties or any other rights -----------------------
pertaining to any Collateral.
8.5 No Liability of Secured Party. Neither the acceptance of this
Agreement by Secured Party, nor the exercise of any rights hereunder by Secured
Party, shall be construed in any way as an assumption by Secured Party of any
obligations, responsibilities, or duties of LASIK arising in connection with the
Collateral assigned hereunder or otherwise bind Secured Party to the performance
of any obligations respecting the Collateral, it being expressly understood that
Secured Party shall not be obligated to perform, observe, or discharge any
obligation, responsibility, duty, or liability of LASIK in respect of any of the
Collateral, including without limitation appearing in or defending any action,
expending any money or incurring any expense in connection therewith. TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, LASIK SHALL AND DOES AGREE TO
INDEMNIFY, PROTECT, DEFEND AND HOLD HARMLESS SECURED PARTY AND ITS SUBSIDIARIES,
AND EACH OF THEIR OFFICERS, DIRECTORS, REPRESENTATIVES, AGENTS, EMPLOYEES,
LENDERS, SUCCESSORS AND ASSIGNS, FROM AND AGAINST ALL LIABILITIES, CLAIMS,
DAMAGES, LOSSES, FINES, PENALTIES, CAUSES OF ACTIONS, SUITS, JUDGMENTS AND
EXPENSES (INCLUDING COURT COSTS, ATTORNEY'S FEES AND COST OF INVESTIGATION) OF
ANY NATURE, KIND OR DESCRIPTION OF ANY PERSON OR ENTITY, DIRECTLY OR INDIRECTLY,
ARISING OUT OF, CAUSED BY OR RESULTING FROM (IN WHOLE OR IN PART), ANY ACT OR
OMISSION OF SECURED PARTY, OR ANYONE ACTING ON BEHALF OF SECURED PARTY, IN
CONNECTION WITH THE COLLATERAL, INCLUDING WITHOUT LIMITATION ANY MARKET
FLUCTUATIONS IN THE COLLATERAL AS A RESULT OF SECURED PARTY'S SALE OF, OR
FAILURE TO SELL, THE INTERESTS AT ANY PARTICULAR TIME WHEN IT HAS THE RIGHT TO
DO SO. THE FOREGOING INDEMNITY SHALL SURVIVE THE EXPIRATION OR EARLIER
TERMINATION OF THIS AGREEMENT.
8.6 Right of Secured Party to Defend Action Affecting Security.
Secured Party may, at the expense of LASIK, appear in and defend any action
or proceeding at law or in equity purporting to affect Secured Party's
Security Interest under this Agreement.
----------------------------------------------------------
8.7 Right of Secured Party to Prevent or Remedy Default. If LASIK shall
fail to perform any of the covenants, conditions and agreements required to be
performed and observed by LASIK under any Other Agreement, or in respect of the
Collateral (subject to any applicable default cure period), Secured Party (a)
may but shall not be obligated to take any action Secured Party deems necessary
or desirable to prevent or remedy any such default by LASIK or otherwise to
protect the Security Interest, and (b) shall have the absolute and immediate
right to take possession of the Collateral or any part thereof (to the extent
Secured Party has not previously taken possession) to such extent and as often
as the Secured Party, in its sole discretion, deems necessary or desirable in
order to prevent or to cure any such default by LASIK, or otherwise to protect
the security of this Agreement. Secured Party may advance or expend such sums of
money for the account of LASIK as Secured Party in its sole discretion deems
necessary for any such purpose.
8.8 Secured Party's Expenses. All reasonable advances, costs,
expenses, charges and attorneys' fees which Secured Party may make, pay or
incur under any provision of this Agreement for the protection of its
security or for the enforcement of any of its rights hereunder, including,
without limitation, in foreclosure proceedings commenced and subsequently
abandoned. ------------------------
8.9. Remedies. No right or remedy herein reserved to Secured Party is
intended to be exclusive of any other right or remedy, but each and every
such remedy shall be cumulative, not in lieu of, but in addition to any
other rights or remedies given under this Agreement and all other security
documents. Any and all of Secured Party's rights and remedies may be
exercised from time to time and as often as such exercise as deemed
necessary or desirable by Secured Party. --------
8.10 LASIK's Waivers. LASIK waives notice of the creation, advance,
increase, existence, extension, or renewal of, and of any indulgence with
respect to, the Obligations; waives notice of intent to accelerate, notice of
acceleration, notice of intent to demand, presentment, demand, notice of
dishonor, and protest; waives notice of the amount of the Obligations
outstanding at any time, notice of any change in financial condition of any
person liable for the Obligations or any part thereof, notice of any Event of
Default, and all other notices respecting the Obligations; and agrees that
maturity of the Obligations and any part thereof may be accelerated, extended,
or renewed one or more times by Secured Party in its discretion, without notice
to Debtor.
8.11 Other Parties and Other Collateral. No renewal or extension of or
any other indulgence with respect to the Obligations or any part thereof, no
release of any security, no release of any person (including any maker,
endorser, guarantor, or surety) liable on the Obligations, no delay in
enforcement of payment, and no delay or admission or lack of diligence or care
in exercising any right or power with respect to the Obligations or any security
therefor or guaranty thereof or under this Agreement shall in other manner
impair or affect the rights of Secured Party under the law, under this
Agreement, or under any other document or agreement pertaining to the other
security for the Obligations, before foreclosing upon the Collateral for the
purpose of paying the Obligations. LASIK waives any right to the benefit of or
to require or control application of any other security or proceeds thereof, and
LASIK agrees that Secured Party shall have no duty or obligation to LASIK to
apply to the Obligations any such other security or proceeds thereof.
ARTICLE IX
MISCELLANEOUS
9.1 Terms Commercially Reasonable. The terms of this Agreement shall
be deemed commercially reasonable within the meaning of the Texas UCC.
-----------------------------
9.2 Notices. Any notices or demands required or permitted to be given
hereunder shall be deemed sufficiently given if in writing and personally
delivered or mailed (with all postage and charges prepaid), addressed to Secured
Party or to LASIK their respective addresses set forth below, or at such other
address as the above parties may from time to time designate by written notice
to the other given in accordance with this Section 9.2. Any such notice, if
personally delivered or transmitted by telex or telegram, shall be deemed to
have been given on the date so delivered or transmitted or, if mailed, be deemed
to have been given on the day after such notice is placed in the United States
mail in accordance with this Section 9.2.
Secured Party: ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇-▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: President
with copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Akin, Gump, Strauss, ▇▇▇▇▇ & ▇▇▇▇, L.L.P.
1900 Frost Bank Plaza
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
LASIK: LASIK Investors, L.L.C.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
9.3 Parties Bound. Secured Party's rights under this Agreement and the
Security Interest shall inure to the benefits of its successors and assigns, and
in the event of any assignment or transfer of any of the Obligations or the
Collateral, Secured Party thereafter shall be fully discharged from any
responsibility with respect to the Collateral so assigned or transferred, but
Secured Party shall retain all rights and powers hereby given with respect to
any of the Obligations or Collateral not so assigned or transferred. All
representations, warranties, and agreements of LASIK if more than one are joint
and several, and all shall be binding upon the personal representatives, heirs,
successors, and assigns of LASIK.
9.4 Waiver. No delay of Secured Party in exercising any power or right
shall operate as a waiver thereof; nor shall any single or partial exercise
of any power or right preclude other or further exercise thereof or the
exercise of any other power or right. No waiver by Secured Party of any
right hereunder of any default by LASIK shall be binding upon Secured Party
unless in writing, and no failure by Secured Party to exercise any power or
right hereunder or waiver of any default by LASIK ------ shall operate as a
waiver of any other or further exercise of such right or power of any
further default.
9.5 Agreement Continuing. This Agreement shall constitute a continuing
agreement, applying to all future as well as existing transactions, whether
or not of the character contemplated at the date of this Agreement, and if
all transactions between Secured Party and LASIK shall be closed at any
time, shall be equally applicable to any new transactions thereafter.
--------------------
9.6 Definitions. Unless the context indicated otherwise, definitions
in the Texas Business and Commerce Code ("Texas UCC") apply to words and
phrases in this Agreement; if Texas UCC definitions conflict, Chapter 9
definitions apply. -----------
9.7 Miscellaneous. In this Agreement, whenever the context so
requires, the neuter gender includes the masculine and feminine, and the
singular number includes the plural and vice versa. The headings of
paragraphs herein are inserted only for convenience and shall in no way
define, describe or limit the scope of intent of any provisions of this
Agreement. No change, amendment, modification, cancellation, or discharge
of any provision of this Agreement shall be valid unless consented to in
------------- writing by Secured Party.
9.8 Assignment of Secured Party's Interest. Secured Party shall have
the right to assign all or any portion of its rights in this Agreement
without approval or consent. LASIK acknowledges that Secured Party intends
to make a collateral assignment of its rights under this Agreement for the
benefit of one or more of its lenders. LASIK may not assign this Agreement
or any of its rights or obligations hereunder without the express prior
written consent of Secured Party in each instance.
--------------------------------------
9.9 Applicable Laws. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE APPLICABLE LAWS
OF THE UNITED STATES OF AMERICA. ---------------
9.10 ENTIRE AGREEMENT. THIS AGREEMENT, THE LOAN AGREEMENT, THE NOTE
AND THE CONTRIBUTION AGREEMENT (AND THE OTHER AGREEMENTS CONTEMPLATED
THEREIN) REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES. ----------------
[Signature page follows]
SIGNATURE PAGE TO
ASSIGNMENT AND
SECURITY AGREEMENT
EXECUTED this ___ day of September, 1999.
DEBTOR: LASIK Investors, L.L.C.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, M.D.
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, M.D., manager
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, M.D.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, M.D., manager
SECURED PARTY: Prime Medical Operating, Inc.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name:▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title:Treasurer