EXHIBIT 10.2
COLLATERAL ASSIGNMENT OF RIGHTS
THIS COLLATERAL ASSIGNMENT OF RIGHTS dated as of April 10, 2000 between
Sierra Health Services , Inc., a Nevada corporation ("SHS") and Anthony M.
Marlon ("Assignor").
BACKGROUND
A. Pursuant to the Loan Agreement between Assignor and SHS dated as of
April 10, 2000 (the "Loan Agreement"), SHS has agreed to extend certain credit
to Assignor, subject to the terms and conditions set forth therein.
B. Assignor has beneficial ownership of shares of stock with a current
value of approximately $4.4 million in Goldman Sachs Main #1 Account. Attached,
as Exhibit A, is a list of stock in Assignor's Goldman Sachs Main #1 Account.
NOW THEREFORE, in consideration of the premises set forth herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Certain Definitions. (a) As used herein, the following terms shall have
the meanings indicated:
"Assigned Rights" shall have the meaning set forth in Section 2 hereof.
"Event of Default" means an Event of Default as defined in the Loan
Agreement and also means any breach by the Assignor of any of his
representations, warranties or covenants under this Agreement.
"Loan" means the credit facility provided by SHS to Assignor in accordance
with the Loan Agreement.
"Obligations" means all now existing or hereafter arising debts,
obligations, covenants, and duties of payment or performance of every kind,
matured or unmatured, direct or contingent, owing, arising, due, or payable to
SHS by or from Assignor arising out of the Loan Agreement or this Agreement,
including, without limitation, all obligations to repay principal of and
interest on all Advances, and to pay interest, fees, costs, charges, expenses,
professional fees, and all sums chargeable to Assignor under the Loan Agreement
or this Agreement, whether or not evidenced by any note or other instrument.
"Uniform Commercial Code" means the Uniform Commercial Code as in effect
from time to time in the State of New York.
(b) The terms "Accounts," "Chattel Paper," "Instruments," and "Proceeds,"
shall have the meanings assigned to such terms in the Uniform Commercial Code.
(c) Capitalized terms used herein and not otherwise defined herein shall
have their respective meanings assigned in the Loan Agreement.
2. Collateral Assignment of Rights. To secure the complete and timely
satisfaction of all Obligations, Assignor hereby pledges and assigns, grants a
security interest in, and transfers to SHS as and by way of a security interest
having priority over all other security interests, with power of sale as set
forth below, to the extent permitted by law, all of Assignor's rights in respect
to stock owned in Assignor's Goldman Sachs Main #1 Account, see Exhibit A, and
any agreement between the Borrower and SHS relating thereto, whether now
existing or hereafter arising, and all proceeds of the foregoing from time to
time received, receivable or otherwise distributed in respect of, or exchange
for, any or all of the foregoing (whether such proceeds arise before or after
the commencement of any proceeding under any applicable bankruptcy, insolvency
or similar law, by or against Assignor, with respect to Assignor) and all powers
and rights of Assignor now or hereafter acquired by Assignor, including rights
of enforcement, under any or all of the foregoing (collectively, the "Assigned
Rights").
3. Title to Assigned Rights.
(a) Assignor has absolute and exclusive title to the Assigned Rights, free
and clear of all liens, security interests and other encumbrances, and Assignor
shall warrant and defend his title to the Assigned Rights, subject to the rights
of SHS, against the claims and demands of all persons.
(b) SHS may, at its sole election but without obligation to do so,
discharge any lien, security interest or other encumbrance of any third party on
any of the Assigned Rights and all expenses incurred by SHS in so doing,
together with interest thereon at the rate applicable under the Loan Agreement,
shall be added to the Obligations and shall be payable by Assignor on demand.
4. Release by SHS. This Assignment is made for collateral purposes only.
Upon payment in full of all Obligations and termination of the Loan, SHS shall
execute and deliver to Assignor all releases, assignments and other instruments
as may be necessary or proper to re-vest in Assignor all rights and interest
conveyed by Assignor to SHS by this Agreement, subject to any disposition
thereof which may have been made by SHS pursuant hereto or pursuant to the Loan
Agreement.
5. Cumulative Remedies; Power of Attorney; Effect on Loan Agreement. All of
SHS's rights and remedies with respect to the Assigned Rights, whether
established hereby, by the Loan Agreement, by any other agreements or by the
Uniform Commercial Code or other law, shall be cumulative and may be exercised
singularly or concurrently. Assignor hereby authorizes SHS to make, constitute
and appoint any officer or agent of SHS as SHS may select, in its sole
discretion, as Assignor's true and lawful attorney-in-fact, with power, from and
after the occurrence of an Event of Default, to take any other actions with
respect to the Assigned Rights as SHS reasonably deems in the best interest of
SHS. Assignor hereby ratifies all that such attorney shall lawfully do or cause
to be done by virtue hereof. This power of attorney shall be irrevocable until
all Obligations shall have been satisfied and the Loan Agreement shall have been
terminated. Assignor acknowledges and agrees that this assignment is not
intended to limit or restrict in any way the rights and remedies of SHS under
the Loan Agreement, but rather is intended to facilitate the exercise of such
rights and remedies given it by the terms of this Assignment, all rights and
remedies allowed by law and the rights and remedies of a secured party under the
Uniform Commercial Code.
6. Financing Statements. Assignor shall execute all financing statements
and amendments thereto and continuations thereof as SHS may request from time to
time to evidence the security interest granted, or intended to be granted, to
SHS hereunder and will pay all filing fees and taxes, if any, necessary to
effect the filing thereof. Wherever permitted by law, Assignor authorizes SHS to
file financing statements with respect to the Assigned Rights without the
signature of Assignor. A copy of this Agreement or a copy of any financing
statement prepared in connection with this Agreement may itself be filed as a
financing statement. The location of Assignor's principal place of business is
at his notice address set forth in Section 8.11 of the Loan Agreement, and
Assignor agrees to provide SHS prior written notice of any change of any such
principal place of business.
7. Waivers. No course of dealing between Assignor and SHS, nor any failure
to exercise, nor any delay in exercising, on the part of SHS, any right, power
or privilege hereunder or under the Loan Agreement shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power or
privilege hereunder or thereunder preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.
8. Severability. The provisions of this Assignment are severable, and if
any clause or provision shall be invalid and unenforceable in whole or in part
in any jurisdiction, then such invalidity or unenforceability shall affect only
such clause or provision, or part thereof, in such jurisdiction, and shall not
in any manner affect such clause or provision in any other jurisdiction, or any
other clause or provision of this Assignment in any jurisdiction.
9. Modification. This Assignment cannot be altered, amended or modified in
any way, except by a writing signed by the parties hereto.
10. Binding Effect, Benefits. This Assignment shall be binding upon
Assignor and his successors and assigns, and shall inure to the benefit of SHS,
its nominees, successors and assigns.
11. Governing Law. This Assignment shall be governed by and construed in
accordance with the laws of the State of Nevada without regard to the conflict
of laws principles thereof.
12. Counterparts. This Assignment may be executed in one or more
counterparts, each of which when executed shall be deemed to be an original, but
all of which taken together shall constitute one of the same document.
13. Further Action. Assignor shall execute and deliver to SHS from time to
time all such other agreements, instruments and other documents (including,
without limitation, all requested financing and continuation statements and all
requested documents relating to the creation, perfection or protection of liens
and security interests) and do all such other and further acts and things as SHS
may reasonably request in order further to evidence or carry out the intent of
this Agreement or to perfect and protect the liens and security interests
created hereby or intended so to be.
IN WITNESS WHEREOF, the parties hereto have duly executed this Assignment
effective as of the day and year first above written.
ASSIGNOR:
/s/ Anthony M. Marlon, M.D.
Anthony M. Marlon, M.D.
SIERRA HEALTH SERVICES, INC.
By: /s/ Erin E. MacDonald
Title: President
Executed by the Assignor
on __June 26____ , 2000
EXHIBIT A
Goldman Sachs Main #1 Market Value
As of 06/26/00
*Estimated Prices
<TABLE>
<CAPTION>
Security Shares Curr Price Cost Basis Gain/Loss Balance
<S> <C> <C> <C> <C> <C> <C>
Cisco Systems, Inc. 5,000.000 63 9/16 44,548.61 273,263.89 317,812.50
Federal Portfolio 550,847.620 1.000* 550,847.62 0.00 550,847.62
Intel Corp. 3,000.000 133 11/16 102,993.75 298,068.75 401,062.50
Morgan Stanley Dean Witter 4,000.000 83 1/4 5,625.00 277,375.00 333,000.00
Sierra Health Services 878,841.000 3 3/16 50,231.50 2,751,074.19 2,801,305.69
TOTAL Investments 804,246.48 3,599,781.83 4,404,028.31
</TABLE>
