PLEDGE AGREEMENT [$10,700,000 LOAN] (Integrated Healthcare Holdings, Inc.)
EXHIBIT
99.8
[$10,700,000
LOAN]
(Integrated
Healthcare Holdings, Inc.)
THIS
PLEDGE AGREEMENT (the “Pledge
Agreement”)
is
dated as of December 12, 2005 and is made by and among INTEGRATED HEALTHCARE
HOLDINGS, INC., a Nevada corporation, with its chief executive office located
at
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, as pledgor (“Pledgor””),
and
MEDICAL PROVIDER FINANCIAL CORPORATION III, a Nevada corporation, as lender
(the
“Lender”).
RECITALS:
A. This
Pledge Agreement is made in connection with a certain Credit Agreement dated
as
of the date hereof (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit
Agreement”)
by and
among Lender, Pledgor (as Borrower) and certain other Credit Parties defined
in
the Credit Agreement.
B. Pledgor
owns one hundred percent (100%) of the authorized, issued and outstanding
equity
interests (the “Pledged
Interests”)
in
WMC-SA, INC., a California corporation (“WMC-SA”),
WMC-A, INC., a California corporation (“WMC-A”),
▇▇▇▇▇▇▇ MEDICAL CENTER, INC., a California corporation (“▇▇▇▇▇▇▇”),
and
COASTAL COMMUNITIES HOSPITAL, INC., a California corporation (“Coastal”)
(WMC-SA, WMC-A, ▇▇▇▇▇▇▇ and Coastal are hereinafter together referred to
as
“the
Companies”).
C. Pledgor
is in the business of delivering acute care services to the public through
four
(4) separate acute care hospital facilities located in Orange County, California
(“Hospital
Facilities”)
identified in Annex
D
to the
Credit Agreement; and, along with one or more of the Credit Parties, is also
in
the business of owning and operating certain medical office buildings and
other
healthcare businesses related thereto.
D. Pursuant
to that certain Credit Agreement dated as of March 3, 2005, as amended
(“Original
Credit Agreement”)
by and
between Pledgor and the Companies (together as Borrowers), the Credit Parties
named therein and Medical Provider Financial Corporation II, a Nevada
corporation, an affiliate of Lender (“Original
Lender”),
Original Lender loaned $50,000,000 to IHHI, WMC-SA, WMC-A, ▇▇▇▇▇▇▇ and Coastal
(the “Acquisition
Loan”)
for the
purpose of acquiring the Hospital Facilities, and made available to IHHI,
WMC-SA, WMC-A, ▇▇▇▇▇▇▇ and Coastal a $30,000,000 line of credit (the
“Line
of Credit Loan”)
for the
purpose of operating the Hospital Facilities (the Acquisition Loan and the
Line
of Credit Loan are hereinafter referred to as the “Original
Loan”).
E. Pledgor
(as Borrower under the Credit Agreement) has requested that Lender make a
new
loan in the amount of $10,700,000 (“New
Loan”)
for the
purpose of operating the Hospital Facilities. Lender has agreed, on the terms
and conditions set forth in this Agreement
and
in
the other documents and instruments evidencing the New Loan (the “New
Loan Documents”).
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F. For
the
purposes set forth above, Lender is willing to make the New Loan and other
extensions of credit to or for the benefit of Borrower of up to such amount
upon
the terms and conditions set forth in the Credit Agreement.
G. Among
other conditions for making the New Loan, Lender has required that Pledgor
pledge to Lender its ownership interest in the Companies as additional
collateral for the payment and performance of the New Loan and the other
Obligations as defined in the Credit Agreement.
H. Pledgor
will derive substantial direct and indirect economic benefits from the
Loan.
I. The
parties intend that these Recitals are made a part of this
Agreement.
NOW,
THEREFORE, for and in consideration of the foregoing and of any financial
accommodations or extensions of credit (including, without limitation, any
loan
or advance by renewal, refinancing or extension of the agreements described
hereinabove or otherwise) heretofore, now or hereafter made to or for the
benefit of any Borrower pursuant to the Credit Agreement or any other agreement,
instrument or document executed pursuant to or in connection therewith, and
for
other good and valuable consideration, the receipt and sufficiency of which
are
hereby acknowledged, Pledgor and Lender hereby agree as follows:
SECTION
1. Definitions.
(a)
Except
as
otherwise defined herein, all initially capitalized terms shall have the
respective meanings given to such terms in the Credit Agreement.
(b)
As
used
herein, the term “Articles
of Incorporation”
collectively means the Articles of Incorporation of WMC-SA, WMC-A, ▇▇▇▇▇▇▇
and
Coastal filed with the California Secretary of State (i) by WMC-SA on October
5,
2004, (ii) by WMC-A on October 5, 2004, (iii) by ▇▇▇▇▇▇▇ on October 23, 2004,
and (iv) by Coastal on October 5, 2004.
(c) As
used
herein, the term “Bylaws”
collectively means the Bylaws of each of the Companies duly adopted (i) by
WMC-SA on October 13, 2004, (ii) by WMC-A on October 13, 2004, (iii) by ▇▇▇▇▇▇▇
on October 13, 2004, and (iv) by Coastal on October 13, 2004.
(d) As
used
herein, the term “Equity
Interests”
means
all shares of capital stock, options and warrants to purchase equity securities
or other forms of equity, membership interests, general or limited partnership
interests or other equivalents (regardless of how designated) of or in a
corporation, partnership, limited liability company or equivalent entity
whether
voting or nonvoting, including common stock, preferred stock or any other
“equity security” (as such term is defined in Rule 3a11-1 of the General Rules
and Regulations promulgated by the Securities and Exchange Commission under
the
Securities Exchange Act).
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(e) As
used
herein, the term “Lien”means
any
mortgage, security deed or deed of trust, pledge, hypothecation, assignment,
deposit arrangement, lien, charge, claim, security interest, security title,
easement or encumbrance, or preference, priority or other security agreement
or
preferential arrangement of any kind or nature whatsoever (including any
lease
or title retention agreement, any financing lease having substantially the
same
economic effect as any of the foregoing, and the filing of, or agreement
to
give, any financing statement perfecting a security interest under the Uniform
Commercial Code or comparable law of any jurisdiction).
SECTION
2. Security
Interest.
As
security for the payment and performance of the Obligations, Pledgor hereby
pledges, grants and assigns to the Lender, and creates in the Lender a security
interest in and Lien on, all of its right, title and interest in, to and
under
the Pledged Interests, whether now existing or hereafter acquired or arising,
including, without limitation, (i) all of Pledgor's interest in the capital
of
the Companies and Pledgor's interest in all undistributed profits and
distributions to which Pledgor shall at any time be entitled in respect of
such
Pledged Interests; (ii) all other payments, if any, due or to become due
to
Pledgor in respect of the Pledged Interests pursuant to the Articles of
Incorporation or Bylaws, as applicable, whether as contractual obligations,
damages, insurance proceeds or otherwise; (iii) all of Pledgor's rights,
powers
and remedies under the Articles of Incorporation or Bylaws, as applicable,
as a
member thereunder or arising from its ownership of the Pledged Interests
pursuant thereto, whether now existing or hereafter arising or acquired,
in, to
and under the Articles of Incorporation or Bylaws, as applicable, including,
without limitation, Pledgor’s rights to receive from time to time its share of
profits, income, surplus, compensation, return of capital, distributions
and
other reimbursements and payments from the Companies (including, without
limitation, specific properties of the Companies upon dissolution and
otherwise); (iv) all of Pledgor's rights under the Articles of Incorporation
or
Bylaws, as applicable, as a member thereunder to manage the affairs of the
Companies (including, without limitation, the power to sell, mortgage or
otherwise deal with the property of the Companies), to make determinations,
to
exercise any election or option or to give or receive any notice, consent,
amendment, waiver or approval, together with full power and authority to
demand,
receive, enforce, execute, endorse or cash any checks or other payments,
or
other instruments or orders, to file any claims and to take any action that
(in
the opinion of Lender) may be necessary or advisable in connection with any
of
the foregoing; (v) any certificates representing the Pledged Interests, and
all
undistributed dividends, distributions, cash, instruments and other property
or
proceeds from time to time receivable in respect of or in exchange for any
or
all of the Pledged Interests; (vi) any additional Equity Interests of or
in the
Companies from time to time acquired by Pledgor in any manner (which Equity
Interests shall be deemed to be part of the Pledged Equity), and the
certificates representing such additional Equity Interests, and all
undistributed dividends, distributions, cash, instruments and other property
or
proceeds from time to time receivable in respect of or in exchange for any
or
all of such Equity Interests; and (vii) any and all rents, issues, profits,
returns, income, allocations, distributions and proceeds of and from any
and all
of the foregoing (collectively, the “Collateral”).
(b)
All
certificates and all promissory notes and instruments evidencing the Collateral
shall be delivered to and held by or on behalf of Lender or Original Lender
pursuant hereto or that certain Membership Pledge Agreement (“Original
Pledge Agreement”)
by and
between Pledgor and Medical Provider Financial Corporation II (“Original
Lender”)
dated
as of March 3, 2005. All Collateral shall be accompanied by duly executed
instruments of transfer or assignment in blank, all in form and substance
satisfactory to Lender.
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(c) Pledgor
hereby irrevocably authorizes the Lender to file one or more financing or
continuation statements and amendments thereto, disclosing and perfecting
the
Lien granted to the Lender under this Agreement without Pledgor’s signatures
appearing thereon, and the Lender agrees to notify Pledgor when such a filing
has been made. Pledgor agrees that a carbon, photographic, photostatic, or
other
reproduction of this Pledge Agreement or of a financing statement is sufficient
as a financing statement. Pledgor agrees that such authorization includes
a
ratification and authorization with respect to any initial financing statements
filed prior to the date hereof.
SECTION
3. Distributions.
Prior
to the full payment and performance of the Obligations, the Lender or the
Original Lender shall receive, as Collateral, any and all additional membership
interests, partnership interests, membership interests, capital stock, options,
warrants, or other property of any kind received, receivable, distributed
or
distributable on or by reason of the Collateral pledged hereunder, whether
in
the form of cash, securities or property or by way of liquidation, conversion,
merger, consolidation, redemption or otherwise. Subject to Pledgor’s right to
receive and retain Distributions so long as an Event of Default under the
Loan
Documents has not occurred or is continuing, Pledgor shall deliver to the
Lender
or Original Lender, or cause the Companies to deliver directly to the Lender
or
Original Lender, all property, including any cash distributions representing
or
constituting any Collateral received or receivable by Pledgor after the date
of
this Pledge Agreement. Any such property received by Pledgor shall be held
by
Pledgor in trust for the Lender and shall forthwith be delivered by Pledgor
to
the Lender or Original Lender as aforesaid.
SECTION
4. Registration
of Pledge.
The
Pledgor hereby represents and warrants that as of the date hereof the Pledged
Interests are not represented by any instruments or certificates and hereby
instructs the Companies to register on the books and records of the Companies
the pledge of the Pledged Interests in the Companies by the Pledgor to the
Lender. In the event that at any time after the date hereof any Collateral
shall
be evidenced by an instrument or a certificate, the Pledgor shall or shall
cause
the Companies to promptly deliver any such instruments or certificates
representing one hundred percent (100%) of the Pledged Interests of the
Companies, duly endorsed or subscribed by the Pledgor or accompanied by
appropriate instruments of transfer or assignment duly executed in blank
by the
Pledgor, to the Lender or Original Lender as additional Collateral. Any
additional instruments or certificates received by the Pledgor shall be held
by
the Pledgor in trust, as agent for the Lender, and Pledgor shall immediately
advise Lender in writing that Pledgor is holding the same..
SECTION
5. Power
of Attorney.
The
Pledgor hereby constitutes and irrevocably appoints the Lender, with full
power
of substitution and revocation by the Lender, as each Pledgor's true and
lawful
attorney-in-fact, for the purpose from time to time upon the occurrence and
during the continuance of an Event of Default of carrying out the provisions
of
this Agreement and taking any action and executing any instrument that the
Lender deems necessary or advisable to accomplish the purposes of this
Agreement, including, without limitation, to affix to certificates and documents
representing any Collateral the endorsements or other instruments of transfer
or
assignment delivered with respect thereto and to transfer or cause the transfer
of the Collateral, or any part thereof, on the books of the Companies. The
power
of attorney granted pursuant to this Pledge Agreement and all authority hereby
conferred are granted and conferred solely to protect the Lender's interest
in
the Collateral and shall not impose any duty upon the Lender to exercise
any
power. This power of attorney shall be irrevocable as one coupled with an
interest until the Obligations have been paid in full and the commitments
of
Lender under the Credit Agreement have been terminated.
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SECTION
6. Representations
of Pledgor.
Pledgor
represents and warrants to the Lender that:
(a) Pledgor
has the power and authority and the legal right to execute, deliver and perform
this Pledge Agreement and to grant the Lien on the Collateral contemplated
hereby in favor of the Lender;
(b) The
execution, delivery and performance of this Pledge Agreement by Pledgor and
the
granting of the Lien on the Collateral contemplated hereby has been duly
authorized by all necessary action and does not and will not (i) violate
any
applicable law, rule or regulation or any provision of the organizational
documents of the Companies, (ii) conflict with, result in a breach of, or
constitute a default under any provision of the Articles of Incorporation,
Bylaws, or any partnership agreement, indenture, mortgage or other agreement
or
instrument to which Pledgor or any of its Affiliates is a party or by which
any
of them or their respective properties or assets is bound or subject or any
license, judgment order or decree of any Governmental Authority having
jurisdiction over Pledgor or any of its Affiliates or their respective
activities, properties or assets or (iii) result in or require the creation
or
imposition of any Lien upon or with respect to any properties or assets now
or
hereafter owned by Pledgor or any of its Affiliates (other than the Liens
created hereunder).
(c) This
Pledge Agreement has been duly executed and delivered by Pledgor and constitutes
a legal, valid and binding obligation of Pledgor enforceable against Pledgor
in
accordance with its terms except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles.
(d) No
consent or authorization of, filing with, or other act by or in respect of,
any
arbitrator or Governmental Authority and no consent of any other Person is
required (i) for the execution, delivery and performance of this Pledge
Agreement by Pledgor, (ii) for the pledge by Pledgor of the Collateral to
the
Lender pursuant to this Pledge Agreement, or (iii) for the exercise by the
Lender of the rights provided for in this Pledge Agreement or the remedies
in
respect of the Collateral pursuant to this Pledge Agreement, except such
as (A)
have been obtained, made or taken and are in full force and effect or (B)
may be
required under federal or state securities laws in connection with any sale
of
the Collateral, or (C) in connection with the ownership, as may be required
by
Governmental Authorities, relating to the operation of acute general care
hospitals;
(e) Pledgor
is the sole legal and beneficial owner of, and has valid and transferable
title
to, its Collateral, free and clear of all Liens, other than the Lien in favor
of
the Lender created by this Pledge Agreement and the Lien in favor of the
Original Lender created by the Original Pledge Agreement;
5
(f) There
are
no outstanding options, warrants or other agreements with respect to the
Collateral;
(g) The
Pledged Interests has been duly authorized and validly issued, and is fully
paid
and non-assessable, and is not subject to, nor will Pledgor at any time permit
it to become subject to, any restrictions governing its issuance, transfer,
ownership or control except those limitations described on Schedule
I
hereto,
all of which have been waived;
(h) The
information set forth in Schedule
I
is true,
correct, complete and accurate;
(i) All
actions (including, without limitation, registration of the Lien created
hereby
on the Pledged Interests on the books and records of the Companies and consent
to the filing of UCC-1 financing statements by Lender in all appropriate
jurisdictions) required to create and perfect the Lien of the Lender in the
Collateral have been taken and the Lien on the Collateral in favor of the
Lender
is superior in right to any rights or claims of any other Person other than
the
rights of the Original Lender;
(j) The
Bylaws and Articles of Incorporation delivered to Lender is a true, correct,
complete and accurate copy of the complete and entire Bylaws and Articles
of
Incorporation in effect on the date hereof and the same has not, as of the
date
hereof, been further amended, modified, terminated, nor cancelled or
superseded;
(k) There
are
no unpaid expenses, capital contributions, costs, fees, charges, interest
payments or other payments of any kind required to be funded or contributed
a
Pledgor pursuant to the Articles of Incorporation or Bylaws that accrued
prior
to the date hereof;
(l) There
are
no actions, suits, proceedings or investigations pending or, to the best
knowledge of Pledgor, threatened, against or affecting Pledgor that are likely
to have a Material Adverse Effect on the validity or enforceability of this
Pledge Agreement, or on the validity or priority of the Liens and security
interests granted by Pledgor as provided for herein, before or by any court,
arbitrator or Governmental Authority;
(m) Pledgor
is not insolvent; and
(n) Pledgor
has been given a true, correct, complete and accurate set of the Credit
Agreement and the other New Loan Documents and the opportunity to review
them
with counsel.
SECTION
7. Obligations
of Pledgor.
Pledgor
further represents, warrants, and covenants to the Lender that:
(a) Pledgor
will not sell, transfer, convey or otherwise dispose of any interest in the
Collateral.
(b) Pledgor
will not suffer or permit any Lien to exist on or with respect to the Collateral
except the Lien created under this Pledge Agreement and the Lien created
by that
certain Pledge Agreement by and between Pledgor and the Original Lender dated
as
of March 3, 2005.
6
(c) Pledgor
will, at its own expense, at any time and from time to time at the request
of
the Lender, do, make, procure, execute and deliver all acts, things, writings,
assurances and other documents as may be reasonably requested by the Lender
to
further enhance, preserve, establish, demonstrate, perfect or enforce the
Lender's rights, interests and remedies created by, provided in or emanating
from this Pledge Agreement.
(d)
Pledgor shall not permit the Companies to issue any additional Equity
Interests.
(e) Pledgor
will defend the Lender's right, title and interest in, to and under the
Collateral against the claims and demands of all Persons
whomsoever.
(f) Pledgor
hereby authorizes the Lender to file one or more financing or continuation
statements and amendments thereto relating to all or part of the Collateral
without such Pledgor's signature. A photocopy or other reproduction of this
Pledge Agreement shall be sufficient as a financing statement.
(g) Pledgor
will cause the Companies to execute and deliver to the Lender on the date
hereof
a letter in substantially the form attached hereto as Exhibit
A.
(h) Pledgor
shall use all reasonable efforts to cause the Companies to perform and observe
all of the terms, covenants, conditions and obligations required to be performed
and observed by the Companies under (i) the New Loan Documents and (ii) any
other contract or agreement with any Person, which, if not performed and
observed, would materially and adversely affect the value of the Collateral
or
the security interest of Pledgee in the Collateral.
(i) Pledgor
shall, at its sole cost and expense, perform and observe all of the terms,
covenants, conditions and obligations required to be performed or observed
by
Pledgor under the Bylaws or Articles of Incorporation.
(j) Upon
an
Event of Default, Pledgor shall not waive any right or remedy under the Bylaws
or Articles of Incorporation without the prior written consent of Lender;
provided that no waiver occurring prior to an Event of Default shall have
a
Material Adverse Effect upon the Liens granted to Lender in the Loan Documents
or upon any of Lender’s rights and remedies.
(k) Pledgor
shall, at its sole cost and expense (i) use reasonable efforts to enforce
the
Bylaws and Articles of Incorporation in accordance with its terms in such
a
manner so as to preserve, and not to materially and adversely affect (A)
the
value of the Collateral or (B) the security interest of Lender in the
Collateral, and (iii) appear in and defend any action or proceeding to which
Pledgor is made a party arising under the Bylaws or Articles of Incorporation
and take all additional action to these ends as from time to time may be
reasonably requested in writing by Lender.
(l) Pledgor
shall not amend or modify the Articles of Incorporation or Bylaws in any
way
that adversely affects the Liens granted to Lender in the New Loan Documents
or
upon any of Lender’s rights or remedies, without the prior written consent of
Lender.
7
(m) Pledgor
shall not authorize or enter into any transaction for the termination,
dissolution or winding up of, or the merger or consolidation with another
entity
or entities by, the admission of additional members to, or the elimination
of
members from, or otherwise effect or change the structure or organization
of the
Companies without the prior written consent of the Lender.
SECTION
8. Rights
of Pledgor.
(a) So
long as no Event of Default has occurred and is continuing, Pledgor shall
be
entitled to vote or consent with respect to the Collateral in any manner
not
inconsistent with this Pledge Agreement, the Credit Agreement or any other
New
Loan Document. Upon the occurrence and during the continuance of an Event
of
Default, the Lender shall have the exclusive right to vote or give consents
with
respect to the Collateral. Pledgor hereby grants to the Lender an irrevocable
proxy to vote the Collateral, which proxy shall be effective immediately
upon
the occurrence of and during the continuance of an Event of Default, and
upon
request of the Lender, Pledgor agrees to deliver to the Lender such further
evidence of such irrevocable proxy or such further irrevocable proxy to vote
the
Collateral as the Lender may request.
(b)
Subject to Pledgor’s right to receive and retain Distributions so long as an
Event of Default under the New Loan Documents has not occurred or is continuing,
any and all (i) distributions paid or payable in cash in respect of any
Collateral whether in connection with a partial or total liquidation or
dissolution or in connection with a reduction of capital or otherwise, and
(ii)
cash paid, payable or otherwise distributed in respect of principal of, or
in
redemption of, or in exchange for Collateral, shall be forthwith delivered
to
the Lender or Original Lender in accordance with Section 3 hereof, to be
held as
Collateral and shall, if received by the Pledgor, be received in trust for
the
benefit of the Lender, be segregated from the other property or funds of
the
Pledgor and be forthwith delivered to the Lender or Original Lender as
Collateral in the same form as so received (with any necessary endorsement
or
assignment).
SECTION
9. - -Rights
of the Lender.
(a) If
Pledgor fails to perform any agreement contained herein, the Lender may (but
shall not be obligated or required to) perform, or cause the performance,
of
such agreement.
(b) At
any
time upon and during the continuance of an Event of Default, the Lender may
(but
shall not be obligated or required to):
(i) Cause
the
Collateral to be transferred to its name or to the name of its nominee or
nominees and thereafter exercise as to such Collateral all of the rights,
powers
and remedies of an owner;
(ii) Ask
for,
demand, collect, ▇▇▇ for, recover, compromise, receive and give acquittances
and
receipts for monies due or to-become due under or in respect of any of the
Collateral and hold the same as part of the Collateral, or apply the same
to any
of the Obligations in such manner as the Lender may direct in its sole
discretion;
(iii) Receive,
endorse and collect any drafts or other instruments, documents and chattel
paper, in connection with clause (ii) above (including, without limitation,
all
instruments representing dividends, interest payments or other distributions
in
respect of the Collateral or any part thereof and give full discharge for
the
same);
8
(iv) File
any
claims or take any actions or institute any proceedings that the Lender may
deem
necessary or desirable for the collection of any of the Collateral or otherwise
to enforce compliance with the rights of the Lender with respect to any of
the
Collateral;
(v) Enter
into any extension, subordination, reorganization, deposit, merger, or
consolidation agreement, or any other agreement relating to or affecting
the
Collateral, and in connection therewith deposit or surrender control of such
Collateral thereunder, and accept other property in exchange therefor and
hold
and apply such property or money so received in accordance with the provisions
hereof; and
(vi) Discharge
any taxes or Liens levied on the Collateral or pay for the maintenance and
preservation of the Collateral; the amount of such payments, plus any and
all
fees, costs and expenses of the Lender (including reasonable attorneys' fees
and
disbursements) in connection therewith, shall, at the Lender's option, be
reimbursed by the Pledgor on demand.
SECTION
10. Event
of Default; Remedies.
Upon
and during the continuance of an Event of Default under the Credit Agreement
or
under any of the other New Loan Documents:
(a) The
Lender shall have all the rights and remedies of a secured party under the
Uniform Commercial Code. In addition, the Lender shall have the right, without
demand of performance or other demand, advertisement or notice of any kind,
except as specified below, 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), to proceed forthwith to collect, receive,
appropriate and realize upon the Collateral, or any part thereof and to proceed
forthwith to sell, assign, give an option or options to purchase, contract
to
sell, or otherwise dispose of and deliver the Collateral or any part thereof
in
one or more parcels at public or private sale or sales at any stock exchange,
broker's board or at any of the Lender'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 any securities constituting the Collateral solely for investment
and
without any intention to make a distribution thereof) as the Lender may deem
appropriate without any liability for any loss due to decrease in the market
value of the Collateral during the period held. If any notification to the
Pledgor of the intended disposition of the Collateral is required by law,
such
notification shall be deemed reasonable and properly given if hand delivered
or
made by telecopy at least five Business Days' prior to such disposition to
the
address of the Pledgor indicated below. Any disposition of the Collateral
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 Lender to purchase all
or
any part of the Collateral so sold at any such sale or sales, 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. At any
such
sale or other disposition, the Lender reserves the right to sell for cash,
on
credit (whether secured or unsecured), or a combination of both, and not
to
credit the Obligations unless and until any deferred portion of the purchase
has
actually been paid to Lender in good funds.
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(b) All
of
the Lender's rights and remedies under this Pledge 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 Lender may deem expedient.
(c) The
Lender may elect to obtain the advice of any independent nationally-known
investment banking firm, including any such firm affiliated with Lender,
with
respect to the method and manner of sale or other disposition of any of the
Collateral, the best price reasonably obtainable therefor, the consideration
of
cash and/or credit terms, or any other details concerning such sale or
disposition.
(d) Pledgor
recognizes that the Lender may be unable to effect a public sale of all or
a
part of the Collateral by reason of certain prohibitions contained in the
Securities Act of 1933, as amended (the “Securities
Act”),
or
other relevant securities laws in any jurisdiction, but may be compelled
to
resort to one or more private sales to a restricted group of purchasers who
will
be required to qualify as “Accredited Investors” (as such term is defined in
Regulation D promulgated under the Securities Act) or under other exemption,
and
who will be obligated to agree, among other things, to acquire the Collateral
for their own account, for investment and not with a view to the distribution
or
resale thereof. Pledgor agrees that private sales so made may be at prices
and
on other terms less favorable to the seller than if the Collateral were sold
at
public sale, and that the Lender has no obligation to delay the sale of any
Collateral for the period of time necessary to permit the registration of
the
Collateral for public sale under the Securities Act or other relevant securities
laws in any jurisdictions. Pledgor agrees that a private sale or sales made
under the foregoing circumstances shall not be deemed to be commercially
unreasonable by virtue of such circumstances.
(e) If
any
consent, approval or authorization of, or filing with, any Governmental
Authority or any other Person shall be necessary to effectuate any sale or
other
disposition of the Collateral, or any partial disposition of the Collateral,
including, without limitation, under any federal or state securities laws,
Pledgor agrees to execute all such applications, registrations and other
documents and instruments as may be required in connection with securing
any
such consent, approval or authorization, and will otherwise use their best
efforts to secure the same. Pledgor further agrees to use its best efforts
to
effectuate such sale or other disposition of the Collateral as the Lender
may
deem necessary pursuant to the terms of this Pledge Agreement.
(f) Upon
any
sale or other disposition; the Lender 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 Lender,
shall hold the Collateral free from any claim or right of whatever kind,
including any equity or right of redemption. Pledgor specifically waives,
to the
extent permitted by applicable law, all rights of stay or appraisal which
Pledgor has or may have under any rule of law or statute now existing or
hereafter adopted.
(g) The
Lender shall not be obligated to make any sale or other disposition unless
the
terms thereof shall be satisfactory to it. The Lender may, without notice
or
publication, adjourn any private or public sale, and, upon five Business
Days'
prior notice to 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
Lender until the selling price is paid by the purchaser thereof, but the
Lender
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.
10
SECTION
11. 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 Lender pursuant to
Section 13 hereof) by the Lender to the payment of the Obligations in such
order
as the Lender may elect in its sole discretion. 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 Lender has actual notice.
SECTION
12. Termination.
This
Agreement shall:
(a) Create
a
continuing security interest in the Collateral.
(b) Remain
in
full force and effect for so long as any of the Obligations are outstanding
or
the Lender has any obligation under the Credit Agreement or other New Loan
Documents.
(c) Be
binding upon Pledgor and its permitted successors and assigns.
(d) Inure
to
the benefit of the Lender and its successors, transferees and
assigns.
Without
limiting the foregoing, the Lender may assign or otherwise transfer the New
Loan, or any portion thereof, held by it to any other Person in accordance
with
the terms of the New Loan Documents, and such other Person shall thereupon
become vested with all the benefits in respect thereof granted herein or
otherwise. Lender shall promptly give Pledgor notice of such assignment or
transfer. Pledgor may not assign its rights or delegate its obligations under
this Agreement without the prior written consent of the Lender.
SECTION
13. Expenses
of the Lender.
All
expenses (including, without limitation, reasonable attorneys' fees and
disbursements) actually incurred by the Lender in connection with the failure
by
Pledgor to perform or observe any provision of this Pledge Agreement, the
exercise or enforcement of any rights of the Lender under this Pledge 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 Lender
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 Pledgor and shall be deemed an Obligation for all purposes of this Pledge
Agreement and the Lender may apply the Collateral to payment of or reimbursement
of itself for such liability.
SECTION
14. Lender's
Duty.
The
Lender shall not be required to take any action hereunder in respect of an
Event
of Default. The Lender shall not be liable for any acts, omissions, errors
of
judgment or mistakes of fact or law including, without limitation, acts,
omissions, errors or mistakes with respect to the Collateral, except for
those
arising out of or in connection with the Lender's gross negligence or willful
misconduct. The Lender shall be under no obligation to take any steps necessary
to preserve rights in the Collateral against any prior parties but may do
so at
its option, and all expenses incurred in connection therewith shall be for
the
account of Pledgor, and shall be added to the obligations secured
hereby.
11
SECTION
15. General
Provisions.
(a) No
failure on the part of the Lender 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 Lender 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
Pledgor herein contained shall survive the date hereof.
(b)
No
amendment or waiver of any provision of this Agreement nor consent to any
departure by 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, signed
by
the Lender and Pledgor. 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 Pledgor under this Pledge Agreement shall remain in full force
and effect without regard to, and shall not be impaired or affected
by:
(i) any
amendment or modification or addition or supplement to the Credit Agreement
or
any New Loan Document, any document or instrument delivered in connection
therewith or any assignment or transfer thereof;
(ii) any
exercise, non-exercise or waiver by the Lender of any right, remedy, power
or
privilege under or in respect of, or any release of any guaranty or collateral
provided pursuant to, the Credit Agreement or any New Loan
Document;
(iii) any
waiver, consent, extension, indulgence or other action or inaction in respect
of
the Credit Agreement or any New Loan Document or any assignment or transfer
of
any thereof; or
(iv) any
bankruptcy, insolvency, reorganization, arrangement, readjustment, composition,
liquidation or the like, of the Companies 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
expressly otherwise provided herein, all notices, requests and demands to
or
upon the respective parties hereto to be effective shall be in writing
(including by telecopy or telex), and shall be deemed to have been duly given
or
made when delivered by hand, or one Business Day after being sent by overnight
mail, or five Business Days after being deposited in the mail, postage prepaid,
or, in the case of telecopy notice, when acknowledged as received, addressed
as
follows, or to such other address as may be hereafter notified by the respective
parties hereto:
12
|
Lender:
|
Medical
Provider Financial Corporation III
▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Tel:
▇▇▇-▇▇▇-▇▇▇▇
Fax:
▇▇▇-▇▇▇-▇▇▇▇
with
a copy of each such notice to:
Sedgwick,
Detert, ▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇
▇▇▇
▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Tel.: (▇▇▇)
▇▇▇-▇▇▇▇
Fax: (▇▇▇)
▇▇▇-▇▇▇▇
|
|
Pledgor:
|
Integrated
Healthcare Holdings, Inc.
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn :
▇▇▇▇▇ ▇▇▇▇▇, CEO
Ph :
(▇▇▇) ▇▇▇-▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
with
a copy of each such notice to:
▇▇▇▇▇▇▇▇
& ▇▇▇▇▇▇▇▇, LLP
▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Attn:
▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Ph:
(▇▇▇) ▇▇▇-▇▇▇▇
Fax:
(▇▇▇) ▇▇▇-▇▇▇▇
|
provided
that any
notice, request or demand to or upon the Lender shall not be effective until
actually received. Any notice, request or demand received on a day which
is not
a Business Day shall be deemed to have been received on the next following
Business Day.
13
(e) IN
ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
THE LOAN DOCUMENTS AND THE OBLIGATIONS SHALL BE GOVERNED BY, AND CONSTRUED
AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEVADA APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN THAT STATE AND ANY APPLICABLE LAWS OF THE
UNITED
STATES OF AMERICA. PLEDGOR AND LENDER HEREBY CONSENT AND AGREE THAT THE STATE
OR
FEDERAL COURTS LOCATED IN THE STATE OF NEVADA, ▇▇▇▇▇ COUNTY, CITY OF NEVADA,
SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES
BETWEEN PLEDGOR AND LENDER PERTAINING TO THIS AGREEMENT OR ANY OF THE OTHER
LOAN
DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT OR
ANY
OF THE OTHER LOAN DOCUMENTS; PROVIDED, THAT LENDER AND PLEDGOR ACKNOWLEDGE
THAT
ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE
OF
▇▇▇▇▇ COUNTY, NEVADA; PROVIDED FURTHER, THAT NOTHING IN THIS AGREEMENT SHALL
BE
DEEMED OR OPERATE TO PRECLUDE LENDER FROM BRINGING SUIT OR TAKING OTHER LEGAL
ACTION IN ANY OTHER JURISDICTION TO REALIZE ON THE COLLATERAL OR ANY OTHER
SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER
IN
FAVOR OF LENDER. PLEDGOR AND LENDER EXPRESSLY SUBMIT AND CONSENT IN ADVANCE
TO
SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND
PLEDGOR
AND LENDER HEREBY WAIVE ANY OBJECTION THAT SUCH PLEDGOR OR LENDER MAY HAVE
BASED
UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS
AND
HEREBY CONSENT TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED
APPROPRIATE BY SUCH COURT. PLEDGOR AND LENDER HEREBY WAIVE PERSONAL SERVICE
OF
THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT
AND
AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINTS AND OTHER PROCESS MAY BE
MADE BY
REGISTERED OR CERTIFIED MAIL ADDRESSED TO PLEDGOR OR TO LENDER AT THE ADDRESS
SET FORTH ABOVE AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED UPON THE
EARLIER OF PLEDGOR’S OR LENDER’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER
DEPOSIT IN THE UNITED STATES MAILS, PROPER POSTAGE
PREPAID.
(f) Pledgor
and Lender each hereby irrevocably waives all right to trial by jury in any
action, proceeding or counterclaim arising out of or relating to this Pledge
Agreement, any other New Loan Document, or any of the transactions contemplated
thereby.
(g) If
any
provision of this Pledge 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 the law while most nearly preserving its original intent. The
invalidity of any part of this Pledge Agreement shall not render invalid
the
remainder of the Pledge Agreement.
(h) This
Pledge Agreement may be executed in counterparts, each of which when so 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 Pledge Agreement are for convenience of reference
only
and shall not affect the interpretation hereof.
14
SECTION
16. Consents.
(a)
Pledgor consents to the transfer of management rights to Lender following
the
occurrence and continuance of an Event of Default under the Credit Agreement,
if
so declared by Lender in writing to Pledgor, and consents to the pledge of
Collateral as defined herein and therein and, to the extent necessary to
give
effect thereto, the Articles of Incorporation and Bylaws are hereby deemed
amended mutatis mutandis.
(b) Pledgor
consents and agrees to the terms of the Credit Agreement and other New Loan
Documents.
SECTION
17. Reinstatement.
This
Pledge Agreement shall remain in full force and effect and continue to be
effective, as the case may be, if at any time payment or performance of the
Obligations or any part thereof, pursuant to applicable law, is avoided,
rescinded, or reduced in amount, or must otherwise be restored or returned
by
Lender, or any other obligee of the Obligations, whether as a "voidable
preference," "fraudulent conveyance" or otherwise, all as though such payment
or
performance had not been made. In the event that any payment, or any part
thereof, is avoided, rescinded, reduced, restored or returned, the Obligations
shall be reinstated and deemed reduced only by such amount paid and not so
avoided, rescinded, reduced, restored or returned.
SECTION
18. Rights
of Lender.
Nothing
contained herein shall (i) release or impair the validity of the principal
indebtedness secured hereby, (ii) in any way affect or impair any Lien granted
pursuant hereto or pursuant to the other New Loan Documents, or (iii) in
any way
affect or impair the right of Lender to foreclose any Liens created under
or to
enforce any other New Loan Documents pursuant to the terms thereof.
SECTION
19. Compliance
With Original Loan Documents.
Lender
agrees that Pledgor shall not be deemed to be in breach of any provisions
of
this Pledge Agreement based on Pledgor’s compliance with the terms of the
Original Loan Documents or requests of the Original Lender pursuant
thereto.
[SIGNATURE
PAGE FOLLOWS]
15
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as
of the day and year first above written.
| “Pledgor” | ||
| INTEGRATED HEALTHCARE HOLDINGS, INC. | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇ ▇▇▇▇▇ | |
| ▇▇▇▇▇ ▇▇▇▇▇ | ||
|
[Printed
Name]
|
||
| Chief Executive Officer | ||
|
[Title]
|
||
| FEIN Number: _________________ | ||
| “Lender” | ||
| MEDICAL PROVIDER FINANCIAL CORPORATION III, | ||
| |
|
|
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇ | |
|
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, President and COO |
||
16
SCHEDULE
I
Pledged
Interests
|
Name
of Company
|
Percentage
of Ownership Interests
|
Percentage
of Economic Interests
|
Restrictions
on Transfer
|
|
WMC-SA,
Inc.
|
100%
|
100%
|
No
transfers permitted
|
|
WMC-A,
Inc.
|
100%
|
100%
|
No
transfers permitted
|
|
▇▇▇▇▇▇▇
Medical Center, Inc.
|
100%
|
100%
|
No
transfers permitted
|
|
Coastal
Communities Hospital, Inc.
|
100%
|
100%
|
No
transfers permitted
|
1
Exhibit
A-1
WMC-SA,
INC.
December
12, 2005
Medical
Financial Provider Corporation III
c/o
Medical Capital Corporation
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
Reference
is made to the Pledge Agreement dated as of the date hereof (the “Pledge
Agreement”)
between Integrated Healthcare Holdings, Inc., as pledgor (the “Pledgor”),
and
you, as lender. Initially capitalized terms used but not defined herein have
the
meanings provided in the Pledge Agreement.
In
connection with the pledge of the Collateral to you by Pledgor, the undersigned
hereby represents, warrants and agrees with you as follows:
(i) In
accordance with Pledgor's instructions; the undersigned has registered on
its
books and records your security interest in the Pledged Interests; no other
Lien
on such Pledged Interests is registered on the books and records of the
undersigned except for the Lien of that certain Pledge Agreement (“Original
Pledge Agreement”)
by and
between Pledgor and Medical Capital Provider Corporation II (“Original
Lender”)
dated
as of March 3, 2005;
(ii) The
undersigned shall deliver directly to you at your or Original Lender address
set
forth in the Pledge Agreement, any and all instruments and/or certificates
evidencing any right, option or warrant, and all new, additional or substituted
securities issued to, or to be received by, Pledgor by virtue of its ownership
of the Pledged Interests issued by the undersigned or upon exercise by Pledgor
of any option, warrant or right attached to such Pledged Interests;
(iii) Subject
to the Credit Agreement, the undersigned shall pay directly to you or Original
Lender any and all cash distributions which might be declared and payable
(including any unpaid distributions accrued prior to the date hereof) on
any of
the Pledged Interests or any of the other Collateral issued by the undersigned;
(iv) At
any
time upon and during the continuance of an Event of Default, upon your written
instructions, the undersigned shall register the transfer of such Pledged
Interests to you or your nominee, as applicable; and
(v) If
the
location where the undersigned keeps its business and organizational records
changes from ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, without
giving you not less than thirty (30) days prior written notice thereof, it
shall
constitute an Event of Default under the Credit Agreement and the other New
Loan
Documents, including the Pledge Agreement.
2
In
addition, the undersigned agrees that, if at any time you shall determine
to
exercise your right to sell all or any of the Collateral issued by the
undersigned, the undersigned will, upon your request and at Pledgor's
expense:
(a)
provide you with such other information and projections as may be necessary
or,
in your opinion, advisable to enable you to effect the sale of such
Collateral;
(b)
do or
cause to be done all such other acts and things as may be necessary to make
the
sale of such Collateral or any part thereof valid and binding and in compliance
with applicable law;
(c)
do or
cause to be done all such other acts and things as may be necessary to
constitute you or your designees or transferees a shareholder of the
undersigned; and
(d)
recognize the validity and enforceability of any action taken by you under
the
power of attorney granted by Pledgor in the Pledge Agreement, and promptly
follow the instructions given by you pursuant to such authority.
You
are
hereby authorized, in connection with any sale of the Collateral issued by
the
undersigned, to deliver or otherwise disclose to any prospective purchaser
of
such Collateral (i) any information and projections provided to you pursuant
to
subsection (a) above and (ii) any other information in your possession relating
to the undersigned or such Collateral, so long as such prospective purchaser
agrees to the provisions of the Credit Agreement.
Very
truly yours,
WMC-SA,
INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
ACKNOWLEDGED,
CONSENTED AND AGREED TO:
INTEGRATED
HEALTHCARE HOLDINGS, INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
3
Exhibit
A-2
WMC-A,
INC.
December
12, 2005
Medical
Financial Provider Corporation III
c/o
Medical Capital Corporation
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
Reference
is made to the Pledge Agreement dated as of the date hereof (the “Pledge
Agreement”)
between Integrated Healthcare Holdings, Inc., as pledgor (the “Pledgor”),
and
you, as lender. Initially capitalized terms used but not defined herein have
the
meanings provided in the Pledge Agreement.
In
connection with the pledge of the Collateral to you by Pledgor, the undersigned
hereby represents, warrants and agrees with you as follows:
(i) In
accordance with Pledgor's instructions; the undersigned has registered on
its
books and records your security interest in the Pledged Interests; no other
Lien
on such Pledged Interests is registered on the books and records of the
undersigned except for the Lien of that certain Pledge Agreement (“Original
Pledge Agreement”)
by and
between Pledgor and Medical Capital Provider Corporation II (“Original
Lender”)
dated
as of March 3, 2005;
(ii) The
undersigned shall deliver directly to you or Original Lender at your address
set
forth in the Pledge Agreement, any and all instruments and/or certificates
evidencing any right, option or warrant, and all new, additional or substituted
securities issued to, or to be received by, Pledgor by virtue of its ownership
of the Pledged Interests issued by the undersigned or upon exercise by Pledgor
of any option, warrant or right attached to such Pledged Interests;
(iii) Subject
to the Credit Agreement, the undersigned shall pay directly to you or Original
Lender any and all cash distributions which might be declared and payable
(including any unpaid distributions accrued prior to the date hereof) on
any of
the Pledged Interests or any of the other Collateral issued by the undersigned;
(iv) At
any
time upon and during the continuance of an Event of Default, upon your written
instructions, the undersigned shall register the transfer of such Pledged
Interests to you or your nominee, as applicable; and
(v) If
the
location where the undersigned keeps its business and organizational records
changes from ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, without
giving you not less than thirty (30) days prior written notice thereof, it
shall
constitute an Event of Default under the Credit Agreement and the other New
Loan
Documents, including the Pledge Agreement.
4
In
addition, the undersigned agrees that, if at any time you shall determine
to
exercise your right to sell all or any of the Collateral issued by the
undersigned, the undersigned will, upon your request and at Pledgor's
expense:
(a)
provide you with such other information and projections as may be necessary
or,
in your opinion, advisable to enable you to effect the sale of such
Collateral;
(b)
do or
cause to be done all such other acts and things as may be necessary to make
the
sale of such Collateral or any part thereof valid and binding and in compliance
with applicable law;
(c)
do or
cause to be done all such other acts and things as may be necessary to
constitute you or your designees or transferees a shareholder of the
undersigned; and
(d)
recognize the validity and enforceability of any action taken by you under
the
power of attorney granted by Pledgor in the Pledge Agreement, and promptly
follow the instructions given by you pursuant to such authority.
You
are
hereby authorized, in connection with any sale of the Collateral issued by
the
undersigned, to deliver or otherwise disclose to any prospective purchaser
of
such Collateral (i) any information and projections provided to you pursuant
to
subsection (a) above and (ii) any other information in your possession relating
to the undersigned or such Collateral, so long as such prospective purchaser
agrees to the provisions of the Credit Agreement.
Very
truly yours,
WMC-A,
INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
ACKNOWLEDGED,
CONSENTED AND AGREED TO:
INTEGRATED
HEALTHCARE HOLDINGS, INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
5
Exhibit
A-3
▇▇▇▇▇▇▇
MEDICAL CENTER, LLC
December
12, 2005
Medical
Financial Provider Corporation III
c/o
Medical Capital Corporation
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
Reference
is made to the Pledge Agreement dated as of the date hereof (the “Pledge
Agreement”)
between Integrated Healthcare Holdings, Inc., as pledgor (the “Pledgor”),
and
you, as lender. Initially capitalized terms used but not defined herein have
the
meanings provided in the Pledge Agreement.
In
connection with the pledge of the Collateral to you by Pledgor, the undersigned
hereby represents, warrants and agrees with you as follows:
(i) In
accordance with Pledgor's instructions; the undersigned has registered on
its
books and records your security interest in the Pledged Interests; no other
Lien
on such Pledged Interests is registered on the books and records of the
undersigned except for the Lien of that certain Pledge Agreement (“Original
Pledge Agreement”)
by and
between Pledgor and Medical Capital Provider Corporation II (“Original
Lender”)
dated
as of March 3, 2005;
(ii) The
undersigned shall deliver directly to you or Original Lender at your address
set
forth in the Pledge Agreement, any and all instruments and/or certificates
evidencing any right, option or warrant, and all new, additional or substituted
securities issued to, or to be received by, Pledgor by virtue of its ownership
of the Pledged Interests issued by the undersigned or upon exercise by Pledgor
of any option, warrant or right attached to such Pledged Interests;
(iii) Subject
to the Credit Agreement, the undersigned shall pay directly to you or Original
Lender any and all cash distributions which might be declared and payable
(including any unpaid distributions accrued prior to the date hereof) on
any of
the Pledged Interests or any of the other Collateral issued by the undersigned;
(iv) At
any
time upon and during the continuance of an Event of Default, upon your written
instructions, the undersigned shall register the transfer of such Pledged
Interests to you or your nominee, as applicable; and
(v) If
the
location where the undersigned keeps its business and organizational records
changes from ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, without
giving you not less than thirty (30) days prior written notice thereof, it
shall
constitute an Event of Default under the Credit Agreement and the other New
Loan
Documents, including the Pledge Agreement.
6
In
addition, the undersigned agrees that, if at any time you shall determine
to
exercise your right to sell all or any of the Collateral issued by the
undersigned, the undersigned will, upon your request and at Pledgor's
expense:
(a)
provide you with such other information and projections as may be necessary
or,
in your opinion, advisable to enable you to effect the sale of such
Collateral;
(b)
do or
cause to be done all such other acts and things as may be necessary to make
the
sale of such Collateral or any part thereof valid and binding and in compliance
with applicable law;
(c)
do or
cause to be done all such other acts and things as may be necessary to
constitute you or your designees or transferees a shareholder of the
undersigned; and
(d)
recognize the validity and enforceability of any action taken by you under
the
power of attorney granted by Pledgor in the Pledge Agreement, and promptly
follow the instructions given by you pursuant to such authority.
You
are
hereby authorized, in connection with any sale of the Collateral issued by
the
undersigned, to deliver or otherwise disclose to any prospective purchaser
of
such Collateral (i) any information and projections provided to you pursuant
to
subsection (a) above and (ii) any other information in your possession relating
to the undersigned or such Collateral, so long as such prospective purchaser
agrees to the provisions of the Credit Agreement.
Very
truly yours,
▇▇▇▇▇▇▇
MEDICAL CENTER, INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
ACKNOWLEDGED,
CONSENTED AND AGREED TO:
INTEGRATED
HEALTHCARE HOLDINGS, INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
7
Exhibit
A-4
COASTAL
COMMUNITIES HOSPITAL, INC.
December
12, 2005
Medical
Financial Provider Corporation III
c/o
Medical Capital Corporation
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
Reference
is made to the Pledge Agreement dated as of the date hereof (the “Pledge
Agreement”)
between Integrated Healthcare Holdings, Inc., as pledgor (the “Pledgor”),
and
you, as lender. Initially capitalized terms used but not defined herein have
the
meanings provided in the Pledge Agreement.
In
connection with the pledge of the Collateral to you by Pledgor, the undersigned
hereby represents, warrants and agrees with you as follows:
(i) In
accordance with Pledgor's instructions; the undersigned has registered on
its
books and records your security interest in the Pledged Interests; no other
Lien
on such Pledged Interests is registered on the books and records of the
undersigned except for the Lien of that certain Pledge Agreement (“Original
Pledge Agreement”)
by and
between Pledgor and Medical Capital Provider Corporation II (“Original
Lender”)
dated
as of March 3, 2005;
(ii) The
undersigned shall deliver directly to you or Original Lender at your address
set
forth in the Pledge Agreement, any and all instruments and/or certificates
evidencing any right, option or warrant, and all new, additional or substituted
securities issued to, or to be received by, Pledgor by virtue of its ownership
of the Pledged Interests issued by the undersigned or upon exercise by Pledgor
of any option, warrant or right attached to such Pledged Interests;
(iii) Subject
to the Credit Agreement,, the undersigned shall pay directly to you or Original
Lender any and all cash distributions which might be declared and payable
(including any unpaid distributions accrued prior to the date hereof) on
any of
the Pledged Interests or any of the other Collateral issued by the undersigned;
(iv) At
any
time upon and during the continuance of an Event of Default, upon your written
instructions, the undersigned shall register the transfer of such Pledged
Interests to you or your nominee, as applicable; and
(v) If
the
location where the undersigned keeps its business and organizational records
changes from ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, without
giving you not less than thirty (30) days prior written notice thereof, it
shall
constitute an Event of Default under the Credit Agreement and the other New
Loan
Documents, including the Pledge Agreement.
8
In
addition, the undersigned agrees that, if at any time you shall determine
to
exercise your right to sell all or any of the Collateral issued by the
undersigned, the undersigned will, upon your request and at Pledgor's
expense:
(a)
provide you with such other information and projections as may be necessary
or,
in your opinion, advisable to enable you to effect the sale of such
Collateral;
(b)
do or
cause to be done all such other acts and things as may be necessary to make
the
sale of such Collateral or any part thereof valid and binding and in compliance
with applicable law;
(c)
do or
cause to be done all such other acts and things as may be necessary to
constitute you or your designees or transferees a shareholder of the
undersigned; and
(d)
recognize the validity and enforceability of any action taken by you under
the
power of attorney granted by Pledgor in the Pledge Agreement, and promptly
follow the instructions given by you pursuant to such authority.
You
are
hereby authorized, in connection with any sale of the Collateral issued by
the
undersigned, to deliver or otherwise disclose to any prospective purchaser
of
such Collateral (i) any information and projections provided to you pursuant
to
subsection (a) above and (ii) any other information in your possession relating
to the undersigned or such Collateral, so long as such prospective purchaser
agrees to the provisions of the Credit Agreement.
Very
truly yours,
COASTAL
COMMUNITIES, INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
ACKNOWLEDGED,
CONSENTED AND AGREED TO:
INTEGRATED
HEALTHCARE HOLDINGS, INC.
By:
_________________________
_________________________
[Printed
Name]
_________________________
[Title]
9